Hangzhou Great Star Industrial Co., Ltd.
2020 Full Annual Report
2021-035
April 2021
Greatstar Hangzhou headquarterLISTA Allen industry, Switzerland
LISTA Allen industry, SwitzerlandShop vac Williamsport Building, USA
Section 1 Important Notes, Contents and Definitions
The Board of Directors, Supervisory Committees and directors, supervisors and senior managementof the Company hereby guarantee that no false or misleading statement or major omission was madeto the materials in this report and that they will assume all the responsibility, individually and jointly,for the authenticity, accuracy and completeness of the contents of the annual report.Qiu Jianping, the head of the Company, Ni Shuyi, the head of accounting work, and Ni Shuyi, thehead of accounting body (accountant in charge), guarantee the authenticity, accuracy andcompleteness of the financial report in the annual report.All the directors attended the board meeting during which they reviewed this report.This annual report involves forward-looking statements such as future plans, which do not constitutethe Company's substantial commitment to investors. Investors and relevant parties should be awareof the associated risks and understand the differences between plans, forecasts and commitments.In this annual report, "Section 4 Discussion and Analysis on Business Conditions ", Part IX "Prospects of the Company " describes in detail the risks that the Company may face in the future.Investors are invited to pay attention to relevant contents and investment risks.The Company has no plans to distribute cash dividends, bonus shares, and convert capital reserveinto share capital.
Contents
Section 1 Important Notes, Contents and Definitions ...... 3
Section 2 Company Profile and Main Financial Indicators ...... 6
Section 3 Business Summary ...... 11
Section 4 Discussion and Analysis on Business Conditions ...... 18
Section 5 Significant Events ...... 47Section 6 Changes in Shares and Shareholders .................................................................... ......... 67Section 7 Preferred Shares ...... 75
Section 8 Convertible Bonds ...... 76
Section 9 Directors, Supervisors, Senior Management and Employees ............................ ............ 79
Section 10 Corporate Governance ...... 93
Section 11 Corporate Bonds ...... 103
Section 12: Financial Report ...... 104
Section 13: Reference file directory ...... 301
Definitions
| Terms | Refers to | Definition |
| Reporting period | Refers to | January 1, 2020 - December 31, 2020 |
| the Company, listed company, GreatStar company, GreatStar | Refers to | Hangzhou Great Star Industrial Co., Ltd. |
| Sheffield Tools | Refers to | Hangzhou GreatStar Sheffield Tools .Co., Ltd |
| Sheffield trading | Refers to | Hangzhou GreatStar Sheffield Trading Co., Ltd. |
| Guozi Robotics | Refers to | Zhejiang Guozi Robotics Co., Ltd. |
| Arrow Company | Refers to | Arrow Fastener Co., LLC |
| Huada Kejie | Refers to | Changzhou Huada Kejie Opto-Electro Instrument Co., Ltd. |
| OLE-SYSTEMS | Refers to | Hangzhou OLE-SYSTEMS CO., LTD Co., Ltd. |
| DONGHAI BANK | Refers to | Ningbo Donghai Bank Co., Ltd. |
| Weiming Investment | Refers to | Hangzhou Weiming Investment Management Co., Ltd. |
| PT Company | Refers to | Prim' Tools Limited |
| GreatStar Group | Refers to | Greatstar Holding Group. Ltd. |
| Lista Company | Refers to | Lista Holding AG |
| Prime-Line Company | Refers to | Prime-Line Products, LLC |
| United Machinery | Refers to | Hangzhou United Machinery Co., Ltd. |
| Haining Intelligent Company | Refers to | Haining GreatStar Intelligent Equipment Co., Ltd. |
| Zhongce Haichao | Refers to | Hangzhou Zhongce Haichao Enterprise Management Co., Ltd. |
| Hangcha Group | Refers to | Hangcha Group Co., Ltd., |
| Hangzhou Haichao | Refers to | Hangzhou Haichao Enterprise Management Partnership (limited Partnership) |
| GreatStar Europe | Refers to | GreatStar Europe AG |
Section 2 Company Profile and Main Financial IndicatorsI. Company Profile
| Stock abbreviation | GreatStar | Stock code | 002444 |
| Stock exchange for stock listing | Shenzhen Stock Exchange | ||
| Company name in Chinese | Hangzhou Great Star Industrial Co., Ltd. | ||
| Chinese abbreviation of the Company | 巨星科技 | ||
| Company name in foreign language (if any) | HANGZHOU GREATSTAR INDUSTRIAL CO., LTD. | ||
| English abbreviation of the Company | GreatStar | ||
| Legal Representative of the Company | Qiu Jianping | ||
| Registered address | No.35 Jiuhuan Road, Shangcheng District, Hangzhou, Zhejiang, China | ||
| Postal code of the registered address | 310019 | ||
| Office address | No.35 Jiuhuan Road, Shangcheng District, Hangzhou, Zhejiang, China | ||
| Postal code of the office address | 310019 | ||
| Company website | www.GreatStar tools.com | ||
| zq@GreatStar tools.com | |||
| Secretary of the Board | Representative on Securities Matters | |
| Name | Zhou Siyuan | Lu Haidong |
| Contact address: | No.35 Jiuhuan Road, Shangcheng District, Hangzhou, Zhejiang, China | No.35 Jiuhuan Road, Shangcheng District, Hangzhou, Zhejiang, China |
| Tel | 0571-81601076 | 0571-81601076 |
| Fax | 0571-81601088 | 0571-81601088 |
| zq@ greatstartools.com | zq@greatstarttools.com |
| Name of media selected by the Company for information disclosure | Securities Times, Securities Daily |
| URL of Website designated by China Securities Regulatory Commission for annual report | http://www.cninfo.com.cn |
| Place of preparation of the Company’s annual report | Board office |
IV. Registration Changes
| Organization code | 91330000731506099D |
| Changes in main business since the Company's listing (if any) | No changes |
| Changes of controlling shareholders (if any) | No changes |
| Name of the accounting firm | Pan-China Certified Public Accountants LLP (special general partnership) |
| Office address of the accounting firm | Block B, Huarun Building, 1366 Qianjiang Road, Hangzhou City, Zhejiang Province |
| Name of signatory accountant | Chen Zhongjiang，Hu Fujian |
| Name of the sponsor institution | Office address of the sponsor institution | Name of the sponsor representative | continuous supervision period |
| China Securities Co., Ltd | Room 2203, North Tower, Shanghai Securities Building, 528 Pudong South Road, Pudong New Area, Shanghai | Fu Xinxiong, Li Huajun | Issue completed to December 31, 2021 |
| Name of the financial advisor | Office address of the financial advisor | Name of the financial advisor sponsor | continuous supervision period |
| China Securities Co., Ltd | Room 2203, North Tower, Shanghai Securities Building, 528 Pudong South Road, Pudong New Area, Shanghai | Shao Xianbao, Zhou Wei,Zhao Xiaomin | Acquisition completed to December 31, 2020 |
| 2020 | 2019 | Increase/decrease this year compared to the previous year | 2018 | |
| Operating Revenue (RMB) | 8,544,440,154.30 | 6,625,464,121.34 | 28.96% | 5,934,673,688.59 |
| Net profit attributable to shareholders of | 1,350,132,516.91 | 895,030,139.78 | 50.85% | 716,999,484.04 |
| listed company (RMB) | ||||
| Net profit attributable to shareholders of the listed company after deduction of non-recurring profits and losses (RMB) | 1,233,758,395.96 | 820,214,354.48 | 50.42% | 765,521,260.98 |
| Net cash flow from operating activities (RMB) | 771,150,625.24 | 809,887,123.60 | -4.78% | 792,573,464.87 |
| Basic earnings per share (RMB/share) | 1.27 | 0.84 | 51.19% | 0.67 |
| Diluted earnings per share (RMB/share) | 1.25 | 0.84 | 48.81% | 0.67 |
| Weighted average return on net assets | 16.67% | 12.54% | 4.13% | 11.21% |
| End of 2020 | End of 2019 | Increase/decrease over the previous year | End of 2018 | |
| Total assets (RMB) | 13,677,779,045.68 | 11,132,498,783.42 | 22.86% | 9,281,397,295.30 |
| Net assets attributable to shareholders of listed company(RMB) | 8,826,190,578.28 | 7,430,589,865.25 | 18.78% | 6,644,827,501.04 |
VIII. Key Quarterly Financial Indicators
Unit: RMB
| First quarter | Second quarter | Third quarter | Fourth quarter | |
| Operating Revenue | 1,320,883,239.10 | 2,500,761,538.48 | 2,455,246,567.72 | 2,267,548,809.00 |
| Net profits attributable to shareholders of listed companies | 181,631,940.63 | 450,084,192.85 | 463,234,171.01 | 255,182,212.42 |
| Net profits attributable to shareholders of the listed company after deduction of non-recurring profits and losses | 176,132,014.32 | 441,373,531.49 | 436,669,698.69 | 179,583,151.46 |
| Net cash flow from operating activities | -1,369,765.85 | -482,146,188.90 | 875,880,050.30 | 378,786,529.69 |
| Item | Amount in 2020 | Amount in 2019 | Amount in 2018 |
| Gains and losses from disposals of non-current assets (including the provision for asset impairment write-off part) | -688,830.06 | -2,121,302.12 | -5,186,717.47 |
| Government subsidies included into the current gains and Losses (excluding the government subsidies closely related to the business of the Company and enjoyed by a fixed quota or a fixed amount in accordance with the state policies) | 30,007,164.80 | 72,827,246.21 | 19,286,290.60 |
| Gains and loss from the investment cost of acquiring subsidiaries, joint ventures and joint ventures is different from the income generated by the fair value of the identifiable net assets of the invested entity when acquiring the investment | 53,341,459.79 |
| Profit and losses from investment or management assets entrusted to others | 1,792,735.16 | 4,763,145.26 | 14,109,831.55 |
| Current net profit and loss of subsidiaries from the beginning of the period to the date of merger arising from business combination under the same control | -209,239.82 | ||
| In addition to the effective hedging business related to the normal business of the Company, the profit and loss from changes in fair value arising from holding trading financial assets, derivative financial assets, trading financial liabilities and derivative financial liabilities, as well as the investment income from the disposal of trading financial assets, derivative financial assets, trading financial liabilities, derivative financial liabilities and other debt investments | 62,235,238.75 | 13,326,704.55 | -87,503,772.53 |
| Income and expenditure other than those mentioned above | -632,799.21 | 826,929.67 | -2,077,045.97 |
| Other profit and loss items that conform to the definition of non-recurring profit and loss | 267,035.13 | 28,040.91 | 21,675.42 |
| Less: Influence amount of income tax | 25,137,742.09 | 11,751,861.59 | -12,742,628.90 |
| Influence amount of minority shareholders' equity (after tax) | 4,810,141.32 | 3,083,117.59 | -294,572.38 |
| Total | 116,374,120.95 | 74,815,785.30 | -48,521,776.94 |
Section 3 Business SummaryI. Primary Business of the Company during Reporting Period
During the reporting period, the Company continued to develop its primary business around the global tool consumption field,sustainably developed a number of new product lines including storage and personal protective equipment, accelerated thedevelopment of new product research, and continuously made efforts in e-commerce direct sales. At present, company's theCompany main products include hand tools and power tools, laser measurement and storage, which are mainly used in the fields ofhome maintenance, construction engineering, vehicle maintenance, robot and automation, mapping, personal protection, etc. In 2020,the Company's overall operating revenue was RMB 8,544.4402 million , a year-on-year increase of 28.96%. In 2020, the Company'snet profit attributable to shareholders of listed companies was RMB 1,350.1325 million , a year-on-year growth of 50.85%,significantly exceeded the annual business objectives set during the pandemic period.
1. Hand Tools and Power Tools Business
During the reporting period, on the premise of doing a good job in pandemic prevention and control, the Company seized thestrategic opportunity of severely restricted competitors, took advantage of China’s first- in resuming advantage in work andproduction, its leading position in the international tool industry to give full play to its five advantages in innovation, channel, supplychain, brand and internationalization, and accelerated the development of new categories and e-commerce channels, The marketshare increased significantly. During the reporting period, the Company independently researched and developed 1629 new products,the output value of new products greatly exceeded the established goal, and made certain progress in the development of newcustomers. At the same time, it met customers’ needs for pandemic prevention materials, and deepened the customer relationship. Inaddition, through the acquisition of Shop Vac related assets, the Company has made progress in power tools business andstrengthened the local service capacity in the United States; Although the Southeast Asian manufacturing base of the Company wasaffected by the pandemic, the resumption of work and production was slow, the shipment was smoothly resumed, and theconstruction of the new base in Thailand and the preliminary work of phase II in Vietnam almost finished; The Company willpromote the cross-border e-commerce business as its strategic focus in the future, prioritize resource allocations to related employeesand property, and sustain its annual growth in income by over 100%. In 2020, the sales revenue of hand tools and power toolsbusiness was RMB 5907.107 million, with a year-on-year growth of 15.70%.
2. Laser Measurement Business
During the reporting period, the Company's laser measurement business developed steadily, and completed the strategicswitching and channel positioning of key customers. It also made significant progress in new product development and customers
development, especially the laser radar products were highly recognized by customers domestically and abroad. The Company hasgrown into an internationally competitive ODM company in the field of laser measurement, and successfully transformed itself andgot out of the dilemma since the China–U.S. trade war in 2018. In 2020, the income of laser measuring instruments was RMB
513.2347 million.
3. Storage Business
During the reporting period, the storage business of the Company showed a trend of differentiation. Due to the pandemic situationand the decline of industrial investment in Europe, the business of European Lista company fell by nearly 30%. With the Company'svigorous resource integration and the recovery of real estate in the United States in the third quarter, the storage business in the UnitedStates improved significantly, almost unchanged from the prior year. In 2020, the revenue of storage was RMB 939.4204 million..
II. Significant Changes in Prime Assets
1. Significant Changes in Prime Assets
| Prime assets | Significant changes |
| Equity assets | No significant change during the reporting period |
| Fixed assets | No significant change during the reporting period |
| Intangible assets | No significant change during the reporting period |
| Construction in progress | No significant change during the reporting period |
| Cash at bank | It increased by 52.65% over the beginning of the period, mainly due to the issuance of convertible bonds to raise funds. |
| Assets | Cause of formation | Asset Size | Location | Operation mode | Control measures to ensure the safety of assets | Gain or loss | Proportion of overseas assets to the net assets of the Company | Any significant impairment risk? |
| Lista Holding AG 100% shares | Equity acquisition | RMB 272.004 million | Switzerland | Independent accounting | Financial supervision and entrusted external audit | Gain | 3.01% | Yes |
| Other Explanation | For details of goodwill impairment, please refer to section 12 financial report (7) item note 28 goodwill in consolidated financial statements. | |||||||
market opportunities in a timely manner, continue to gain market share and maintain long-term and stable development.
2. Channel advantage
The Company's sales channels and customer trust are the guarantee for the continuous development of GreatStar. TheCompany's diversified product structure and continuous innovation ability do not only fulfill channel customers’ needs for one-stoppurchase, but also continuously help them save the purchasing cost and management, led to improved customer stickiness. TheCompany has become one of the largest suppliers of tools and storage for Homedepot, WallMart, Lowes, Kingfisher, CTC and otherlarge supermarket chains in the United States, and has been continually expanding new product categories At present, there are morethan 21,000 large-scale hardware, building materials, auto parts and other chain supermarkets all over the world selling all kinds ofproducts of the Company at the same time. These channels effectively ensure the rapid development of all kinds of innovativeproducts of the Company. At the same time, the Company has made continuous efforts in cross-border e-commerce, a new saleschannel, and achieved three digit growth rate in the reporting period compared with the same period of last year. At present, cross-border e-commerce channel has become the most important sales channel for GreatStar except for the traditional large chainsupermarkets. As an effective supplement to the traditional channels, this channel not only provides a new market for the Companyto develop its own brand, but also empower the Company's advantages of rapid innovation, formed a vicious product developmentcycle constitutes of product development - online validation – second-time product development – offline hot product launch andsell.
3. Supply chain advantage
After decades of development, the Company has established a global supply chain management system with China as the core,and established a good cooperative relationship with thousands of suppliers around the world to ensure that the Company is notlimited to its own production capacity, can quickly respond to market demand and complete the timely delivery of various largeorders. Even in the face of the adverse effects of COVID-19, as a leading global tool industry rooted in China, China can maintainstable supply capability and benefit from China's most complete supply chain system with the most fundamental foundation in theworld, thus laying a solid foundation for the Company to continuously improve its market share. At the same time, the characteristicsof efficiency and flexibility brought by China's super large volume and super fine supply chain network also enable the Company toachieve centralized procurement in China and global distributed use, greatly reduce the comprehensive procurement cost andenhance the market competitiveness of the Company's products.
4. Brand advantage
The Company's main products are consumer durables for families and industrial products for professionals, and the brand is themost effective guarantee for the Company to provide products and services to consumers for a long time, so the Company has beencommitted to building and developing its own brand for a long time. During the reporting period, the Company vigorously developedits own brands, especially e-commerce brands. The sales revenue of Workpro, Pony, Everbrite and other brands increasedsignificantly year on year, reaching RMB 2.6 billion for the first time. The Company acquired relevant assets of Shop Vac, theleading brand of vacuum cleaners in North America, gradually promoted the layout of power tools field, and improved theCompany's own brand system. Brand advantages not only further enhance the international competitiveness of the Company'sproducts, but also effectively improve the Company's gross profit margin and business stability, providing a guarantee for theCompany's long-term healthy development.
5. Internationalization advantages
During the reporting period, the domestic and international economic environment changed dramatically. GreatStar adhered toits international expansion strategy, and fully utilized the Company production capacity and sales market in different regions of theworld, actively responded to risks and seek opportunities.
During the reporting period, the Company further adjusted its manufacturing division of labor around the world and acceleratedthe investment pace of GreatStar 's manufacturing base in Southeast Asia. At present, the Company has formed the capacity layout ofVietnam and Cambodia in Southeast Asia. The Thai manufacturing base is about to be put into production. The preliminary siteselection work of Vietnam manufacturing base phase II and Cambodia manufacturing base phase II has been completed.Internationalization advantages effectively ensure that does not only play the advantages of China's manufacturing cluster, but alsomake use of the advantages of Southeast Asia's manufacturing cost and the advantages of local channel services in European andAmerican markets in the competition with other international competitors, so as to create a stronger core competitiveness. The
Company is gradually becoming a global resource allocation company integrating European and American local services, Asianindustrial chain manufacturing and Chinese management research and development.
Arrow New Jersey office and industry, USA
Prime Line California Building, USA
Section 4 Discussion and Analysis on Business Conditions
I. OverviewIn 2020, the sudden outbreak of COVID-19 seriously affected global trade, and greatly affected the global industrial chainsystem which brought uncertainty to the sustainable development of the Company. In the first half of the year, the pandemic had asignificant adverse impact on the Company's production, logistics and terminal market. However, the Company actively responded tothe pandemic situation. While doing a good job in pandemic prevention and control and delivery of main business orders, GreatStaractively arranged the production capacity and sales of pandemic prevention materials, especially personal protective equipment, toensure the stability of the Company's business in the first half of the year. In the second half of this year, the global tool demandmarket and supply chain pattern have undergone some continuous changes that are conducive to the Company's operation. TheUnited States has adopted modern monetary theory to stimulate consumption of the ordinary Americans and tried to restart the newand old infrastructure construction in the United States. The Company has seized this opportunity to give full play to its ownadvantages and continue to gain market share. It has achieved a growth far exceeding that expected in the first half of the year.During the reporting period, the Company achieved a total operating income of RMB 8,544.4402 million, an increase of 28.96% overthe same period last year, and the net profit attributable to shareholders of the listed company was RMB 1,350.1325 million, anincrease of 50.85% over the same period last year. The completion of each business segment is as follows:
1.Hand Tools and Power Tools Business
During the reporting period, the Company gave full play to the advantages of innovation, supply chain, brand, sales channel andinternationalization, continued to invest in cross-border e-commerce business and OBM development, and accelerated the pace ofproduct innovation. After the decline in the first half of the year, the main business orders recovered rapidly in Q3. The Company hasseized the opportunity of restructuring the global industrial chain and realized the improvement of market share against the trend. Theannual sales revenue of hand tools and power tools business was RMB 5,907.107 million, up 15.70% year on year.During the reporting period, the Company's cross-border e-commerce department increased brand investment, carried out KOLmarketing and sponsored the "Xfinity" series of "NASCAR" car race in the United States to enhance the brand image and influence;At the same time, we will intensify the launch and promotion of new products to achieve sustainable and rapid growth of cross-border e-commerce business. Thanks to the continuous double-digit growth of OBM revenue such as Arrow and Prime-line, as wellas the rapid growth of cross-border e-commerce business, the Company's OBM sales exceeded RMB 2.6 billion for the first time,with a year-on-year growth of 12.52%.
Through the acquisition of Shop Vac related assets, the Company entered the North American Vacuum Cleaner Market andgradually grew power tools; At the same time, with the acquisition of production capacity and warehouse, the Company will furtherimprove the production capacity and enhance the storage capacity in the United States, and provide customers with more satisfyingNorth American local services. In addition, the Company continues the construction of manufacturing bases in Southeast Asia. Themanufacturing base in Thailand will soon be put into operation, and the construction of phase II manufacturing base in Vietnam andphase II manufacturing base in Cambodia will start.
Finally, the Company continued to increase R&D investment, and R&D expenditure reached a record high, which stronglysupported the Company's OBM construction and market share acquisition. At the same time, the Company saved various operationalexpenses, and further consolidated the gross profit margin and net profit of hand tools and power tools business.
2. Laser Measurement Business
During the reporting period, the Company's laser measurement business continued to achieve stable sales revenue, despite inface of pandemic outbreak that European and the U.S. companies tried to move production back to their own countries andreconstruct domestic industry supply chain. GreatStar makes full use of the new technology platform to develop new products, anddeveloped more than 100 new laser measurement products throughout the year to ensure that the Company's products alwaysmaintain leading position in the ODM field; At the same time, the Company optimized production resources, broke through theexisting capacity and supply chain bottlenecks, ensured the timely delivery of orders. At the same time, the Company hassuccessfully completed the strategic transformation and channel positioning of the major customers of laser products, laying a solidfoundation for the 21-year laser business to enter a period of rapid development again. Since 2016, the Company's R&D investmentin lidar business has also made important progress. The holding subsidiary OLE-SYSTEMS has obtained new orders in the U.S. andEuropean markets, and has carried out long-term cooperation with Datalogic, a famous European brand, and signed a product supplyagreement, In cooperation with Chongqing Research Institute Co., Ltd., a leading enterprise in the field of coal mine safety, the mineintrinsic safety lidar level sensor has been developed, which broadens the application field of lidar products of the Company. Theannual sales revenue of laser measuring instrument business was RMB 513.2347 million.
3、Storage Business
During the reporting period, the storage business of the Company showed a trend of differentiation. Due to the pandemicsituation and the decline of industrial investment in Europe, the business of European Lista company fell by nearly 30%. With theCompany's vigorous resource integration and the recovery of real estate in the United States in the third quarter, the storage businessin the United States improved significantly, basically unchanged from the previous year. At the same time, the Company completedthe cooperation with Xindadi company and the construction and production of Cambodian storage manufacturing base, laying a goodproduction capacity foundation for the future sustainable development of this business. In 2020, the revenue of storage will be RMB
939.4204 million.
4、Personal Protective Equipment Business
During the reporting period, the Company actively responded to overseas outbreaks and responded to the demand for personalprotective equipment put forward by overseas customers. It has earned an additional income of RMB 1 billion 143 million and hassuccessfully entered the new field of PPE (personal protective equipment), reflecting the Company's development capability in nonhand tool business and the channel advantage of the Company. In 2020, the income of personal protective articles business reachedRMB 1142,565 million.II. Main business analysis
1. Overview
See "I. Overview" in " Discussion and Analysis on Business Conditions ".
2. Revenue and Costs
(1) Operating income composition
Unit: RMB
| 2020 | 2019 | Year-on-year increase/de crease | |||
| Amount | Proportion in operating income | Amount | Proportion in operating income | ||
| Total operating income | 8,544,440,154.30 | 100% | 6,625,464,121.34 | 100% | 28.96% |
| By industry | |||||
| Tools & hardware | 8,502,327,129.89 | 99.51% | 6,593,396,615.03 | 99.52% | 28.95% |
| Other incomes | 42,113,024.41 | 0.49% | 32,067,506.31 | 0.48% | 31.33% |
| By product | |||||
| Hand Tools and Power Tools | 5,907,106,985.40 | 69.14% | 5,105,703,895.16 | 77.07% | 15.70% |
| Laser Measurement | 513,234,699.39 | 6.01% | 522,373,199.21 | 7.88% | -1.75% |
| Storage | 939,420,434.18 | 10.99% | 965,319,520.66 | 14.57% | -2.68% |
| PPE | 1,142,565,010.92 | 13.37% | |||
| Other income | 42,113,024.41 | 0.49% | 32,067,506.31 | 0.48% | 31.33% |
| By region | |||||
| America | 6,087,960,337.66 | 71.25% | 4,268,118,867.65 | 64.42% | 42.64% |
| Europe | 1,597,573,574.54 | 18.70% | 1,654,878,452.48 | 24.98% | -3.46% |
| Other regions | 373,208,130.61 | 4.37% | 291,267,494.22 | 4.40% | 28.13% |
| China | 443,585,087.08 | 5.19% | 379,131,800.68 | 5.72% | 17.00% |
| Other income | 42,113,024.41 | 0.49% | 32,067,506.31 | 0.48% | 31.33% |
| By brand | |||||
| Original Brand (OBM) | 2,626,930,299.06 | 30.74% | 2,334,622,159.43 | 35.24% | 12.52% |
| Original Design (ODM) | 5,875,396,830.83 | 68.76% | 4,258,774,455.60 | 64.28% | 37.96% |
| Other income | 42,113,024.41 | 0.49% | 32,067,506.31 | 0.48% | 31.33% |
| Operating income | Operating cost | Gross margin ratio | Year-on-year increase/decrease of operating income | Year-on-year increase/decrease of operating cost | Year-on-year increase/decrease of gross margin ratio | ||
| By industry | |||||||
| Tools& hardware | 8,502,327,129.89 | 5,906,839,891.29 | 30.53% | 28.95% | 32.90% | -2.06% | |
| By product | |||||||
| Hand Tools and Power Tools | 5,907,106,985.40 | 4,134,914,061.55 | 30.00% | 15.70% | 17.68% | -1.18% | |
| Laser Measurement | 513,234,699.39 | 365,707,432.15 | 28.74% | -1.75% | -1.19% | -0.41% | |
| Storage | 939,420,434.18 | 624,178,422.88 | 33.56% | -2.68% | 11.32% | -8.35% | |
| PPE | 1,142,565,010.92 | 782,039,974.71 | 31.55% | ||||
| By region | |||||||
| America | 6,087,960,337.66 | 4,243,843,996.87 | 30.29% | 42.64% | 45.97% | -1.59% | |
| Europe | 1,597,573,574.54 | 1,060,400,800.11 | 33.62% | -3.46% | 1.83% | -3.45% | |
| By brand | |||||||
| Original Brand（OBM） | 2,626,930,299.06 | 1,788,355,440.64 | 31.92% | 12.52% | 15.74% | -1.90% | |
| Original Design（ODM） | 5,875,396,830.83 | 4,118,484,450.65 | 29.90% | 37.96% | 42.04% | -2.02% | |
sales expenses were included in the main business costs, involving an amount of RMB208,409,500 (freight in 2020), resulting in adecrease in the overall gross profit rate of the Company compared with the same period last year.
(3) Whether the Company's physical sales revenue is greater than the service revenue
√ Yes □ No
| Industry category | Item | Unit | 2020 | 2019 | Year-on-year increase/decrease |
| Tools& hardware | Sales volume | PCS | 499,606,095 | 412,267,268 | 21.19% |
| Production output | PCS | 471,227,326 | 412,006,497 | 14.37% | |
| Inventory | PCS | 60,979,242 | 47,399,136 | 28.65% |
| Industry category | Item | 2020 | 2019 | Year-on-year increase/decrease | ||
| Amount | Proportion in operating cost | Amount | Proportion in operating cost | |||
| Tools& hardware | 5,906,839,891.29 | 99.66% | 4,444,550,727.80 | 99.51% | 0.15% | |
| Other costs | 19,926,004.47 | 0.34% | 21,858,354.58 | 0.49% | -0.15% | |
| Product category | Item | 2020 | 2019 | Year-on-year increase/decrease | ||
| Amount | Proportion in operating cos | Amount | Proportion in operating cos | |||
| Hand Tools and Power Tools | 4,134,914,061.55 | 69.76% | 3,513,711,236.82 | 78.67% | -8.91% | |
| Laser Measurement | 365,707,432.15 | 6.17% | 370,112,416.13 | 8.29% | -2.12% | |
| Storage | 624,178,422.88 | 10.53% | 560,727,074.85 | 12.55% | -2.02% | |
| PPE | 782,039,974.71 | 13.20% | 13.20% | |||
| Other costs | 19,926,004.47 | 0.34% | 21,858,354.58 | 0.49% | -0.15% | |
(6) Whether the consolidation scope changes in the reporting period
√ Yes □ No
For details ,please refer to Section 12 financial report 8. Changes in the consolidation scope.
(7) Major changes or adjustments of business, products or services of the Company during the reportingPeriod
□ Applicable √ Not applicable
(8) Major sales customers and major suppliers
Major sales customers of the Company
| Total sales of top five customers (RMB) | 3,860,583,539.18 |
| Total sales of top five customers / Total annual sales | 45.19% |
| Total sales of top five customers / Total sales of related parties | 0.00% |
| No. | Customer name | Sales amount (RMB) | Proportion in total annual sales |
| 1 | Customer 1 | 1,429,685,171.88 | 16.73% |
| 2 | Customer 2 | 1,052,521,546.36 | 12.32% |
| 3 | Customer 3 | 950,673,419.25 | 11.13% |
| 4 | Customer 4 | 250,138,257.14 | 2.93% |
| 5 | Customer 5 | 177,565,144.55 | 2.08% |
| Total | -- | 3,860,583,539.18 | 45.19% |
| Total purchase amount of top five suppliers (RMB) | 222,318,094.54 |
| Proportion of total purchase amount of top five suppliers in total annual purchase amount | 3.83% |
| Among the purchase amount of top five suppliers, proportion of purchase amount of related parties in total annual purchase amount | 0.00% |
| No. | Supplier name | Purchase amount (RMB) | Proportion in total annual purchase amount |
| 1 | Supplier 1 | 51,150,308.81 | 0.88% |
| 2 | Supplier 2 | 44,563,091.15 | 0.77% |
| 3 | Supplier 3 | 43,626,137.49 | 0.75% |
| 4 | Supplier 4 | 42,681,919.92 | 0.74% |
| 5 | Supplier 5 | 40,296,637.17 | 0.69% |
| Total | -- | 222,318,094.54 | 3.83% |
| 2020 | 2019 | Year-on-year increase/decrease | Description of major changes | |
| Selling expenses | 458,274,408.65 | 586,968,060.26 | -21.93% | This is mainly due to the implementation of the new revenue standard in 2020, and the freight is disbursed to the main business cost. |
| Management expenses | 500,999,938.00 | 477,705,229.09 | 4.88% | |
| Financial expenses | 113,580,005.05 | -39,057,511.61 | -390.80% | This is mainly due to the fluctuation of exchange rate and the increase of interest expense in issuing convertible bonds in the current period. |
| Research and development cost | 245,372,069.36 | 203,772,736.84 | 20.41% |
| 2020 | 2019 | Proportion of change | |
| Number of R & D personnel (person) | 701 | 662 | 5.89% |
| Proportion of R & D personnel | 9.50% | 10.29% | -0.79% |
| R & D investment (RMB) | 245,372,069.36 | 203,772,736.84 | 20.41% |
| R & D Investment / Operating Revenue ratio | 2.87% | 3.08% | -0.21% |
| Capitalized amount of R & D investment (RMB) | 0.00 | 0.00 | - |
| Capitalized R & D Investment / R & D Investment ratio | 0.00% | 0.00% | - |
| Item | 2020 | 2019 | Year-on-year increase/decrease |
| Subtotal cash inflows from operating activities | 8,733,248,296.13 | 7,077,194,623.69 | 23.40% |
| Subtotal cash outflows from operating activities | 7,962,097,670.89 | 6,267,307,500.09 | 27.04% |
| Net cash flow from operating activities | 771,150,625.24 | 809,887,123.60 | -4.78% |
| Subtotal cash inflows from investment activities | 371,506,589.54 | 131,185,841.16 | 183.19% |
| Subtotal cash outflows from investment activities | 770,100,603.46 | 1,526,077,145.17 | -49.54% |
| Net cash flow from investment activities | -398,594,013.92 | -1,394,891,304.01 | -71.42% |
| Subtotal cash inflows from financing activities | 3,889,710,965.44 | 1,483,310,724.60 | 162.23% |
| Subtotal cash outflows from financing activities | 2,730,585,831.23 | 1,217,857,389.63 | 124.21% |
| Net cash flow from financing activities | 1,159,125,134.21 | 265,453,334.97 | 336.66% |
| Net increase of cash and cash equivalents | 1,602,805,770.74 | -314,238,796.40 | -610.06% |
| Item | 2020 | 2019 | Year-on-year increase/decrease | Description of major changes |
| Subtotal cash inflows from investment activities | 371,506,589.54 | 131,185,841.16 | 183.19% | Mainly due to the disposal of Zhejiang Supcon Information Technology Co., Ltd.; |
| Subtotal cash outflows from investment activities | 770,100,603.46 | 1,526,077,145.17 | -49.54% | This is mainly due to the capital increase of RMB 975 million in the same period to Zhongce Haichao |
| last year; | ||||
| Subtotal cash inflows from financing activities | 3,889,710,965.44 | 1,483,310,724.60 | 162.23% | Mainly due to the new trade financing (US dollar) in the current period, the US dollar interest rate has greater advantages than the RMB interest rate, and can effectively hedge the Company's exchange rate risk; |
| Subtotal cash inflows from financing activities | 2,730,585,831.23 | 1,217,857,389.63 | 124.21% | Mainly due to the return of financing (US dollars) under trade; |
| End of 2020 | At the beginning of 2020 | Proportion change | Description of major changes | |||
| Amount | Proportion in total assets | Amount | Proportion in total assets | |||
| Cash at bank | 3,750,506,068.39 | 27.42% | 2,456,926,805.33 | 22.07% | 5.35% | |
| Accounts receivable | 1,260,096,723.75 | 9.21% | 1,107,232,500.18 | 9.95% | -0.74% | |
| Inventory | 1,386,320,837.86 | 10.14% | 1,193,884,981.91 | 10.72% | -0.58% | |
| Investment Properties | 0.00% | 0.00% | ||||
| Long-term equity investment | 2,207,878,459.67 | 16.14% | 1,931,344,951.25 | 17.35% | -1.21% | |
| Fixed assets | 1,348,034,595.31 | 9.86% | 1,058,454,179.69 | 9.51% | 0.35% | |
| Construction in progress | 166,268,204.96 | 1.22% | 129,158,811.57 | 1.16% | 0.06% | |
| Short term borrowings | 1,015,117,910.75 | 7.42% | 823,460,644.57 | 7.40% | 0.02% | |
| Long term borrowings | 509,555,882.91 | 3.73% | 689,385,008.46 | 6.19% | -2.46% |
| Item | Opening Balance | Changes in Fair Value Gains and Losses in Current Period | Accumulated Fair Value Changes Included in Equity | Provision for Impairment in Current Period | Amount of purchase in the Current Period | Amount of Sales in Current Period | Other Changes | Closing Balance |
| Financial assets | ||||||||
| 1. Financial assets held for trading (excluding derivative financial assets) | 61,208,550.94 | 410,131.88 | 30,438,658.50 | 27,191,411.52 | ||||
| 2. Derivative financial assets | 10,789,880.93 | 26,609,270.45 | 36,027,480.86 | |||||
| 3. Investments in other equity instruments | 532,386.17 | 532,386.17 | ||||||
| Subtotal financial assets | 71,998,431.87 | 27,019,402.33 | 30,438,658.50 | 532,386.17 | 63,751,278.55 | |||
| Total | 71,998,431.87 | 27,019,402.33 | 30,438,658.50 | 532,386.17 | 63,751,278.55 | |||
| Financial liabilities | 4,901,459.62 | 4,901,459.62 | 0.00 | |||||
| Item | Book Value at the End of | Limitation Reason |
| Period | ||
| Cash at bank | 14,267,400.00 | Bank accepentance deposits |
| Cash at bank | 2,154,766.92 | Investment funds deposited |
| Cash at bank | 3,295,074.50 | Margin for forward settlement and sale of foreign exchange |
| Cash at bank | 495,608.89 | Performance security of the project |
| Cash at bank | 30,000.00 | ETC margin |
| Accounts Receivable | 18,342,218.60 | Pledge of bank loan |
| Fixed assets | 11,803,478.08 | For bank loan mortgage |
| Fixed assets | 31,664,662.87 | Used for issuing bank acceptance bill as mortgage |
| Intangible assets | 3,075,032.85 | For bank loan mortgage |
| Intangible assets | 2,174,573.65 | Used for issuing bank acceptance bill as mortgage |
| Arrow Fastener Co., LLC 100.00% shares [note] | 443,085,633.62 | Pledge of bank loan |
| Total | 530,388,449.98 |
| Investment Amount During the Reporting Period (RMB) | Investment Amount During the Same Period of Previous Year (RMB) | Change |
| 540,855,823.95 | 1,485,350,997.72 | -63.59% |
| Name of Investee | Principal activities | Form of investment | Amount of investment | Holding percentage | Source of funds | Partner | Investment period | Type of products | Progress as at balance sheet date | Expected income | Current investment gains or losses | Any litigation involved | Date of disclosure (if any) | Disclosure index (if any) |
| Suzhou Xindadi Hardware Products Co., Ltd | Hardware tools and accessories | Acquisition | 60,000,000.00 | 60.00% | Self-owned funds | No | Indefinite | Long term equity investment | completed | 9,553,529.05 | 9,553,529.05 | No | ||
| Total | -- | -- | 60,000,000.00 | -- | -- | -- | -- | -- | -- | 9,553,529.05 | 9,553,529.05 | -- | -- | -- |
3. Significant ongoing non-equity investments during the reporting period
□ Applicable √ Not applicable
4. Investments in Financial Assets
(1) Investments in Securities
√ Applicable □ Not applicable
Unit: RMB
| Security Type | Stock Code | Abbreviation of Security | Initial Investment | Accounting Measurement Model | Book value at the beginning of the reporting period | Gains and losses from changes in fair value during the period | Accumulated fair value changes included in equity Accumulated fair value changes included in equity | Purchase amount during the reporting period | Sales amount during the reporting period | Gains and losses of the reporting period | Book value at the end of the reporting period | Accounting items | Capital source |
| Bond | Isin:USY9896RAB79 | ZOOMLIOM | 39,592,347.31 | Fair value measurement | 21,392,377.77 | 515,237.41 | 1,269,949.31 | 20,494,906.65 | Trading financial assets | Self-owned funds | |||
| Bond | Isin:XS1839368831 | NEW METRO | 13,937,100.21 | Fair value measurement | 6,995,593.84 | 162,553.78 | 518,347.50 | 6,696,504.87 | Trading financial assets | Self-owned funds | |||
| Bond | 5382.HK | XINHU BVI N2003 | 33,051,991.50 | Fair value measurement | 32,820,579.33 | -267,659.31 | 30,438,658.50 | 2,634,913.96 | Trading financial assets | Self-owned funds | |||
| Total | 86,581,439.02 | -- | 61,208,550.94 | 410,131.88 | 0.00 | 0.00 | 30,438,658.50 | 4,423,210.77 | 27,191,411.52 | -- | -- | ||
| Disclosure Date of Securities Investment Approval Board Announcement | |||||||||||||
| Disclosure Date of Securities Investment Approval Shareholders | |||||||||||||
Meeting Announcement(if any)
（2）Investments in Derivative Financial Instruments
√ Applicable □ Not applicable
Unit: RMB10 thousands
| Counterparty | Related-party relationship (Y/N) | Related- party transactions (Y/N) | Type of derivatives | Initial investment amount | Starting date | Ending date | Investment amount at the beginning of the reporting period | Amount of purchase in the reporting period | Amount of sales in the reporting period | Provision for impairment (if any) | Investment amount at the end of the reporting period | Investment amount at the end of the reporting period to net assets of the Company | Gains/(losses) recognized during the reporting period |
| Bank | No | No | Forward Exchange | 16,908.96 | 2019/08/20 | 2020/08/20 | 12,557.16 | 12,557.16 | 0.00% | 184.15 | |||
| Bank | No | No | Forward Exchange | 8,468.64 | 2019/08/23 | 2020/08/27 | 8,371.44 | 8,371.44 | 0.00% | 202.75 | |||
| Bank | No | No | Forward Exchange | 8,425.2 | 2020/02/21 | 2021/02/25 | 8,425.2 | 7,120.22 | 1,304.98 | 0.14% | 176.44 | ||
| Bank | No | No | Forward Exchange | 16,925.28 | 2020/03/19 | 2020/12/23 | 16,925.28 | 16,925.28 | 0.00% | 888.93 | |||
| Bank | No | No | Forward Exchange | 12,836.88 | 2020/05/04 | 2021/05/07 | 12,836.88 | 6,311.98 | 6,524.9 | 0.72% | 345.05 | ||
| Bank | No | No | Forward Exchange | 10,896.16 | 2020/09/24 | 2021/09/28 | 10,884.48 | 10,439.84 | 1.16% | ||||
| Bank | No | No | Forward Exchange | 3,405.05 | 2020/09/09 | 2021/09/10 | 3,405.05 | 3,262.45 | 0.36% | ||||
| Bank | No | No | Forward Exchange | 13,620.2 | 2020/09/05 | 2021/09/29 | 13,620.2 | 13,049.8 | 1.44% | ||||
| Bank | No | No | Forward Exchange | 24,789.24 | 2019/05/17 | 2020/05/15 | 10,464.3 | 10,464.3 | 0.00% | 156.42 |
| Bank | No | No | Forward Exchange | 24,817.68 | 2019/08/01 | 2020/09/10 | 18,835.74 | 18,835.74 | 0.00% | 30.1 | |||
| Bank | No | No | Forward Exchange | 33,736.78 | 2019/10/12 | 2020/10/15 | 33,276.47 | 33,276.47 | 0.00% | 396.66 | |||
| Bank | No | No | Forward Exchange | 20,983.5 | 2019/11/08 | 2020/12/14 | 19,184.55 | 19,184.55 | 0.00% | 266.75 | |||
| Bank | No | No | Forward Exchange | 10,539.3 | 2019/12/02 | 2020/09/04 | 10,539.3 | 10,539.3 | 0.00% | 120.7 | |||
| Bank | No | No | Forward Exchange | 6,810.1 | 2020/09/18 | 2021/12/31 | 6,810.1 | 6,524.9 | 0.72% | ||||
| Bank | No | No | Forward Exchange | 13,620.2 | 2020/09/21 | 2021/12/31 | 13,620.2 | 13,049.8 | 1.44% | ||||
| Bank | No | No | Forward Exchange | 13,620.2 | 2020/09/23 | 2021/12/31 | 13,620.2 | 13,049.8 | 1.44% | ||||
| Total | 240,403.37 | -- | -- | 113,228.96 | 100,147.59 | 143,586.44 | 67,206.47 | 7.42% | 2,767.95 | ||||
| Capital sources of derivatives investment | Self-own funds | ||||||||||||
| Litigation (if applicable) | No | ||||||||||||
| Disclosure Date of Securities Investment Approval Board Announcement | April 23, 2020 | ||||||||||||
| Disclosure Date of Securities Investment Approval Shareholders Meeting Announcement (if any) | |||||||||||||
| Risk analysis and control measures of derivatives positions in the reporting period (including but not limited to market risk, liquidity risk, credit risk, operational risk, legal risk, etc.) | To guard against exchange rate risk, the Company and its subsidiaries have carried out derivative business, and the Company and its subsidiaries strictly implement the management system for foreign exchange hedging business. | ||||||||||||
| For the changes in market price or fair value of products during the period of the invested derivatives report, the analysis of fair value of derivatives shall disclose the specific methods used and the setting of relevant assumptions and parameters | At the beginning of the reporting period, the floating income of fair value of derivatives invested was RMB 1.3946 million, and at the end of the reporting period, the floating income of fair value of derivatives was RMB 31.5107 million. |
| Whether the accounting policies and accounting principles of the Company's derivatives in the reporting period have changed significantly compared with those in the previous reporting period | Unchanged |
| Independent director's special opinions on the Company's derivatives investment and risk control | The Company carries out foreign exchange derivatives trading in line with the actual operation needs of the Company, and it is necessary to reduce the impact of exchange rate fluctuation on the Company's profit to a certain extent. The Company has established the management system of foreign exchange derivatives trading business and effective risk control measures according to the requirements of relevant laws and regulations. We agree with the Company's proposal on the implementation of foreign exchange derivatives transactions in 2020. |
| Year | Method of Funding | Total Raised Funds | Total Raised Funds invested in the current year | Accumulative Raised Funds invested | Total Raised Funds with usage altered in the reporting period | Accumulative Raised Funds with usage altered | Proportion of accumulative total Raised Funds with usage altered | Total unused Funds | Use and Allocation of unused Funds | Funds Idled for over Two Years |
| 2020 | Public Issuance of Convertible Corporate Debentures | 97,260 | 39,820.77 | 39,820.77 | 0 | 0 | 0.00% | 57,446.68 | Deposited in the special account for raised funds | 0 |
| Total | -- | 97,260 | 39,820.77 | 39,820.77 | 0 | 0 | 0.00% | 57,446. | -- | 0 |
| 68 | ||
| Description for overall utilization of Raised Funds | ||
| With the approval of China Securities Regulatory Commission (CSRC) zjxk [2019] No. 2656 and the consent of Shenzhen Stock Exchange, the Company is approved to issue convertible corporate bonds not exceeding RMB 972,600,000.00, which shall be preferentially allocated to the original shareholders of the Company by the lead underwriter, China CITIC Construction Investment Securities Co., Ltd, The balance after the prior placement of the original shareholders (including the part that the original shareholders give up the prior placement) is issued to the public investors through the Internet, and the part with the subscription amount less than RMB 972,600,000.00 is underwritten by the main underwriter. This time, the Company has issued 9,726,000 convertible corporate bonds to the public, with a face value of RMB 100.00 each. The total fund raised is RMB 972,600,000.00, and the fund raised after deducting the underwriting and sponsor fees of RMB 5,188,679.25 (excluding tax) is RMB 967,411,320.75, which has been remitted into the regulatory account of the Company's fund raised by the lead underwriter, China Securities Co., Ltd. on July 2, 2020. In addition, after deducting RMB 2,289,867.92 of external expenses directly related to the issuance of convertible corporate bonds, such as underwriting and recommendation fees, audit and verification fees, attorney fees, credit rating fees, information disclosure fees for the issuance, lottery fees and bond issuance registration fees, the net fund raised by the Company is RMB 965,121,452.83. The above raised funds have been verified by Pan China Certified Public Accountants LLP (special general partnership), and the verification report (Pan-China verified [2020] No. 244) has been issued by the LLP. As of December 31, 2020, the Company has invested RMB 398.2077 million in the raised funds, the net interest income of the raised funds in 2020 is RMB 6.2638 million, the exchange gain and loss of financial expenses is RMB– 0.4346 million, and the external expenses directly related to the issuance of convertible corporate bonds that have not been transferred from the raised funds are RMB 1.7238 million. As of December 31, 2020, the balance of the raised funds account is RMB 574.4668 million. | ||
| Committed investment projects and allocation of over-raised funds | Whether project has been (or partially) altered | Total committed investment based on net Raised Funds | Total investment after alteration (1) | Investment in the current year | Accumulative investment at the end of the period (2) | Investment progress at the end of the period (%) (3) = (2)/(1) | Date of asset ready for intended use | Benefits achieved in the current year | Whether expected benefits have been achieved | Whether feasibility of project has changed significantly |
| Committed investment projects | ||||||||||
| 1. Laser measuring instrument and smart home production base construction project | No | 20,426 | 20,426 | 3,121.75 | 3,121.75 | 15.28% | 2022/12/31 | 0 | N/A | No |
| 2. Toolbox cabinet production base construction project | No | 26,776 | 26,776 | 10,724.67 | 10,724.67 | 40.05% | 0 | N/A | Yes | |
| 3.Intelligent warehousing and logistics base construction project | No | 22,542.15 | 22,542.15 | 6,974.35 | 6,974.35 | 30.94% | 2022/12/31 | 0 | N/A | No |
| 4. R & D center construction project | No | 7,768 | 7,768 | 2022/12/31 | 0 | N/A | No | |||
| 5.Supplementing working capital | No | 19,000 | 19,000 | 19,000 | 19,000 | 100.00% | 0 | N/A | No | |
| Subtotal of committed in-vestment projects | -- | 96,512.15 | 96,512.15 | 39,820.77 | 39,820.77 | -- | -- | -- | -- | |
| Investment of excess proceeds | N/A | |||||||||
| Total | -- | 96,512.15 | 96,512.15 | 39,820.77 | 39,820.77 | -- | -- | 0 | -- | -- |
| Status & reasons for planned progress or estimated income not achieved | 1.The main body of the project is Haining GreatStar Intelligent Equipment Co., Ltd., a wholly-owned subsidiary, and GreatStar Vietnam Intelligence Co., Ltd, a wholly-owned subsidiary. The project is located in LIANHANG economic and Technological Development Zone, Haining City, Zhejiang Province and South Cambridge Industrial Zone, Shuiyuan County, Haiphong City, Vietnam. The original construction period of the project is two years, It is planned to be completed by the end of December 2020. In the process of project implementation, the Company added GreatStar Vietnam Intelligence Co., Ltd, which superimposed the sudden outbreak of COVID-19, which had a certain impact on the Company's project construction progress and delayed the completion time of the project. The Company plans to add HANGZHOU GREAT STAR TOOLS CO.,LTD., a wholly-owned subsidiary, as one of the implementation subjects of the project, add the plot No. 26 of municipal government and industrial development (2020) in Shangcheng District of Hangzhou City as one of the implementation sites of the project, and simultaneously adjust the investment structure of the project and extend the implementation period to December 31, 2022. 2. Haining GreatStar Intelligent Equipment Co., Ltd., a wholly-owned subsidiary, is the main body of the construction project of intelligent warehousing and logistics base. The implementation site is located in LIANHANG economic and Technological Development Zone, Haining City, Zhejiang Province. The original construction period of the project is two years, and it is planned to be completed by the end of December 2020. Affected by the pandemic situation of COVID-19, infrastructure construction, logistics transportation, equipment installation and commissioning and other aspects of the project were affected to varying degrees, | |||||||||
| resulting in the delay of the project implementation schedule. In order to ensure the smooth implementation of the project, the Company plans to extend the implementation period of the project to December 31, 2022, taking into account the Company's development planning and the actual construction of the project. 3. The main body of R & D center construction project is the wholly-owned subsidiary of Shanghai United Machinery Co., Ltd. The project is located in the northwest corner of the intersection of Hongpu road and Jiuheng Road, Jiubao street, Shangcheng District, Hangzhou city. The original construction period of the project is three years. It is planned to complete the equipment procurement, installation and commissioning on December 31, 2020, and complete the personnel recruitment and training by the end of 2021. At the beginning of 2020, the sudden outbreak of COVID-19 has a certain impact on the project construction progress of the Company, resulting in the delay of the project implementation progress compared with the original plan. To better integrate the existing innovation and R & D resources of the Company and better support the development of the Company's own brand and cross-border e-commerce business, the Company plans to change the implementation subject of the project to Hangzhou Great Star Industrial Co., Ltd., adjust the investment structure and extend the implementation period to December 31, 2022. | |
| Significant changes in the feasibility of projects | The outbreak of COVID-19 has a certain impact on the construction progress of the Company's toolbox cabinet production base construction project, which delays the completion time of the original project. According to the Company's long-term strategic planning and current development needs, in order to improve the use efficiency of raised funds, improve the Company's existing production capacity and supply capacity faster, and better meet the needs of customers, the Company plans to use the raised funds of RMB134,944,200 which has not been invested as of April 5, 2021 in the toolbox cabinet production base construction project to purchase 100% equity of Geelong Holdings Limited, The original toolbox cabinet production base construction project was terminated. The raised funds used in the project have been invested in the construction of the production base of toolbox of Haining GreatStar Intelligent Equipment Co., Ltd. and NEWLAND XDD (THAILAND) CO., LTD., and no benefit has been generated by the end of the period. |
| Amount, usage and use progress of over- raised Funds | N/A |
| Change in implementation location of investment projects of Raised Funds | Appliable |
| Occurs during the reporting period | |
| On July 22, 2020, the Company held the 37th meeting of the 4th Board of Directors, deliberated and passed the proposal on increasing the implementation subject and implementation place of some raised investment projects and using part of the raised funds to increase capital to wholly-owned subsidiaries. 1. It is agreed that GreatStar Vietnam Intelligence Co., Ltd., a wholly-owned subsidiary of the laser measuring instrument and smart home production base construction project, will be one of the project implementation subjects, and South Cambridge Industrial Zone in Shuiyuan County, Haiphong City, Vietnam will be one of the project |
| implementation sites; 2. It is agreed to add a wholly-owned subsidiary NEWLAND XDD (THAILAND) CO., LTD. as one of the main body of the project, and add No. 54 / 5, village 1, Mayangpeng Town, Baodan County, Rayong Prefecture, Thailand as one of the implementation sites of the project. On April 14, 2021, the Company held the eighth meeting of the Fifth Board of directors, deliberated and passed the proposal on changing the implementation subject and location of the project, adjusting the investment structure of the project and extending the implementation period. 1. Agree to add HANGZHOU GREAT STAR TOOLS CO.,LTD., a wholly-owned subsidiary of the laser measuring instrument and smart home production base construction project, as one of the project implementation subjects, and add municipal government and industrial development (2020) No. 26 plot in Shangcheng District of Hangzhou City as one of the project implementation sites; 2. Agree to change the implementation subject of R & D center construction project to Hangzhou Great Star Industrial Co., Ltd. | |
| Adjustment to implementation method of investment projects of Raised Funds | N/A |
| Upfront investment and replacement of investment projects of Raised Funds | Applicable |
| On July 22, 2020, the Company held the 37th meeting of the 4th Board of Directors, deliberated and passed the proposal on using the raised funds to replace the self-raised funds invested in the raised projects in advance. 1. Agreement on the Company to use raising fund RMB 148.2549 million to replace the prepaid self-raised fund , up till the end of the reporting period, apart from RMB 123.6 thousand, the self-raised fund which was used for R&D center construction hasn’t been transferred, the remaining has been transferred on Sept. 9th 2020. 2. Agreement on the Company to use self-raised fund to pay for the distribution expense RMB 1.7238 million, use raised fund for replacement. Until the end of reporting period, the transfer haven’t been done by the Company. | |
| Supplementing working capital temporarily with idle Raised Fund | N/A |
| Balances of the Raised Funds during the project implementation and the reasons | N/A |
| Usage and allocation of the unused Raised Funds | As of the end of the period, the unused balance of the raised funds is equivalent to RMB 574,466,800 (including the net amount of interest received from bank deposits deducting bank charges of RMB 6.2638 million), all of which are deposited in the special account for raised funds. |
| Defects and other problems in utilisation and disclosure of the Raised Funds | N/A |
| Counterparty | Disposal of equity interests | Date of disposal | Transaction price (RMB10 thousands) | Net profit attributable to the Company by the disposed equity from the beginning of the reporting period to the date of disposal (RMB10 thousands) | Impact of the disposal of equity interests on the Company | Proportion of net profit attributable to the equity interests disposed to the Listed Company’s total net profit | The pricing principle for disposal of the equity interests | Related party transaction | Relationship with the counterparty | Completion of the transfer of the property rights of the assets involved | Completion of the transfer of the equity interests involved | Implemented as scheduled. If not, provide the reasons and steps taken | Date of disclosure | Disclosure Index |
| Zhejiang CHINT Electrics Co., Ltd. | 11.05% equity of Zhejiang Supcon Information Technology Co., Ltd | 2020/4/8 | 17,688.81 | The retained earnings of the reporting period increased by RMB 47,151,416.95 | Fair value | No | N/A | Yes | Yes | Yes | 2020/04/09 | Announcement No：2020-016 |
| Company name | Company Type | Primary Business | Primary Business | Total Assets | Net Assets | Operating Income | Operating Profit | Net Profit |
| Arrow | Subsidiary | Manufacture | -- | 537,271,548.99 | 423,236,641.63 | 681,937,438.83 | 82,043,126.08 | 84,006,980.33 |
| GreatStar Europe | Subsidiary | Manufacture | -- | 1,947,149,220.45 | 243,359,620.32 | 639,282,247.55 | 101,180,223.26 | 89,846,754.17 |
| Company Name | Acquisition or Disposal of Subsidiaries During the Reporting Period | Impact on Overall Production Operations and Performance |
| Zhejiang GreatStar electromechanical Manufacturing Co., Ltd | Consolidation by merger [note] | No major impact |
| Suzhou Xindadi Hardware Product Co., Ltd. | Agreement obtained | No major impact |
IX. Prospects of the Company
（1）Company development strategy
The overall development strategy of the Company is: Focusing on the main business, basing on China, global strategy and planningfor a long time.Focusing on the main business ,the Company will continue to use the existing large-scale business supermarket and e-commerceowned channels in Europe and America, focus on the main business of tools as the core products, and will continue to dispose non-core business assets to recover cash and use it for the development of main business. The Company will also rely on the extension ofM & A to develop non-hand tools including power tools and outdoor products.
Basing on China, the Company will rely on the Southeast Asian supply chain network and Chinese engineers, to lead the globalsupply chain division of the tool industry, continue to expand the leading position of the industry, lead the development of internationaltool industry, and gradually take over the industrial transfer in the era of innovative economy with the creation of customer demand asthe core in the future.
Global strategy means that the Company continues to focus on strengthening the construction of European and American OBMservice system and Southeast Asia capacity layout, selecting foreign high-quality companies for industrial merger and integration,better access to international resources and international markets, and gradually upgrading the Company from ODM company made inChina to an international OBM company combining Chinese design, Asian manufacturing and European and American local services.
Finally, for long-term planning, GreatStar will follow the Company development history of hardware and tools industry, sustainedgrowth in durable consumer goods market and stable cash flow. The company plans its own business and development path for a longhorizon, gradually grows its new business. GreatStar’s goal is growing into a great company with stable operation, sustained growthand healthy development to create long-term value for society. The specific business areas are as follows:
1. Hand tools field
In the field of hand tools, market demand has rapidly recovered at the end of the second quarter of 2020. With steady increase ofdisposable income and low debt level among American residents during the pandemic , the Company believes that the market demandin North America will continue to grow steadily. With the recovery of core CPI in the U.S., the growth rate of hand tools industry inthe next 3-5 years is expected to reach more than 4%, faster than the annual growth rate of 2.5% in 2015-2020.
Due to the low industry threshold and stable demand, the global supply chain system has been shifted towards China since 2015,and the market has been developing strategically towards minimum redundancy and maximum efficiency. It has been clearing up the
outdated production capacity. But the China–United States trade war since 2018 and the COVID-19 in 2020 have greatly affected theindustry chain. This has caused a sudden supply chain crisis and cash flow break of many overseas companies, and the supply side mayhave long-term scar effect in the future.In the future, the Company will follow the above trends, continue to take the market as the guidance, give full play to theadvantages of innovation, channel, supply chain, brand and internationalization, consolidate and expand the hand tools business, andensure long-term sustainable growth.
(1) International market
First, the strong international sales network has been an important factor for the rapid development of the Company in recentyears. In addition to continuing develop the existing global large chain supermarket as a core sales channel, the Company will continueto sink into local small and medium-sized distributors, and strengthen the service capacity of North America and Europe sales network.Second, the Company will continue to increase its investment in its own brands. In the future, the Company will continue toacquire famous tool brands like Prime line, Lista and Arrow, and integrate them into company's owned-the Company's own brand lines,jointly promote the brands globally, continuously improve the proportion of OBM sales. The Company will also improve the core valueand social influence of its own brand by continuously developing innovative products and providing high-quality services, and realizethe continuous improvement of its own brand value, so promote the stable and sustainable rapid development of the Company's business.Third, the Company actively expands overseas production base according to the changes of external environment, and has initiallypossessed the ability of global capacity allocation. In the future, it will continue to play this advantage to create a mode of combiningAsian manufacturing with local services in Europe and America.
(2) Domestic market
Domestic hand tools industry is still fragmented. As the overall economic growth tends to slow down, the Company will orderlydevelop domestic tool market, continue the development strategies of major customers and e-commerce platforms, build a refined keyclient service system, gradually develop the cooperative business system, and strive to build a cooperative system within five years,Gain market share matching its own industry position.
(3) Cross border E-commerce
As a new consumption path, cross-border e-commerce platform direct marketing has become a new and important hand tool saleschannel . Leverage on Amazon based overseas e-commerce platform, the Company successfully realized brand overseas DTC sale. In2020, the Company achieved the top one sales value on Amazon among the domestic export sellers of hand tools. The Company has
taken cross-border e-commerce business as the strategic focus and prioritized the allocation of employees and capital to support thisstrategic focus, at the same time, GreatStar introduced external talents, deployed innovative product development, and graduallylaunched online multi-brand sales. In the future, the Company will give full play to the operation ability of e-commerce team, enhancebrand power, ensure the effective improvement of brand image while achieve sustained and fast growth in revenue from e-commercesales. GreatStar aims to build the owned brands into internationally well-known brands, in 3-5 years to achieve a less than 20% marketshare of the Company's in European and American e-commerce market.
2.Power tools field
In the field of power tools, although the market size is far larger than that of the hand tools, due to the high unit price of products,fewer product types and rapid development of electric tool technology in past 10 years, the market share has been grabbed by a fewleading companies, and the first five StanleyBlack&Decker (SWK.N), TTI (0669.HK), and Bosch (500530.BO), Makita (6586.T),Husqvarna (HUSQA.S) have concentrated more than 55% of the market share, and the remaining markets are concentrated in the handsof dozens of regional special power tool brands. As the major customer of the Company, the large business supermarket has notdeveloped its own brand power tools business, but has chosen to cooperate with international brands to sell these international brandpower tools products in its own channels in an exclusive way, which makes the Company have no way to develop the power toolbusiness according to the path from traditional OEM to ODM in the past 10 years.Since 2020, due to the impact of the pandemic, some regional brands of special power tools such as Shop Vac and BeA havebroken down and forced to enter bankruptcy proceedings, which provides the Company with a strategic window period to enter thefield of power tools directly through OEM and ODM. At the same time, due to the large-scale application of new energy, especiallylithium battery technology in electric vehicles and other fields and the continuous R&D and innovation of related companies, thethreshold of lithium battery electric tools has been declining, which provides the industrial basis for the Company to integrate maturetechnology and overtake leading companies.In the future, the Company will integrate power tool supply chain and channel resources, strengthen independent R & D investment,give priority to the development of vacuum cleaner, power nail gun and other companies already have strong brand power tool business.Meanwhile, the cross-border e-commerce is the main channel, and the self-owned brand is used to create electric tools productsspecifically for e-commerce customer groups and new housing groups in Europe and America who are born after1985.In the long-term, the Company will pay attention to the trend of international power tool brand companies, continue to purchasethe target of high-quality power tools, expand the Company's power tools business, improve the competitiveness of the Company, andbuild long-term growth momentum for the Company's tool business.
3. Laser measuring instrument field
With penetration of mobile internet accelerated, the future market development prospect of laser measurement products isbecoming more and more clear. Since 2016, the Company has successfully integrated and developed laser measurement products andindustrial ecological chain that meet the need of its own sales network through investment in Huada Kejie, PT company and OLE-SYSTEMS, and gradually become the most competitive laser measurement instrument manufacturer in the world.
In the future, the Company will make effort into developing the laser measurement field, focusing on the development of lasersensing core modules such as laser ranging and lidar, including: further research and improvement of laser measurement product line,increasing the integration of domestic and foreign laser measurement product production capacity, and building the largest productionand manufacturing base of laser measurement products in the world; By using the technology of independent intellectual property, thefusion of lidar and sensor is improved, customized products based on special application scenarios are developed, and the marketpromotion and customer cognition of lidar products will be accelerated; Capital will be injected to accelerate the integration of theindustry chain and the market ; Accelerate the establishment of European and American local technical support and after-sales servicecenter, to provide more satisfying local services for European and American customers; In about five-years time, the laser productbusiness has been developed into a new core pillar business of the Company, and gradually created an independent brand of lasermeasurement products.
4. Storage field
Storage is a new business developed by the Company in recent three years. However, relying on industrial integration and channelexpansion, this business has already been of a certain scale. The global storage market will be about $8 billion in 2020, and due to thelarge volume of products, high transportation cost and high proportion of raw materials, even the global leading companies will haveless than 5% market share. In 2018, the Company entered this new field by merging Lista, the leading European storage company, andsuccessfully integrated Xindadi, the leading domestic storage company in 2020, established Cambodia manufacturing base with theadvantages of all parties, successfully entered the mainstream market of the United States, and made the market share increase in theadverse situation.
In the future, the Company will continue to integrate excellent storage companies and brands at home and abroad through capitalmeans, and at the same time, innovate and develop storage products suitable for European and American and Chinese civil markets.Through about three years, the Company will establish the Company's absolute leading position in the global storage business.
（2） Business plan
1. Overall business objectives
The Company sets the strategy to focus on the main business, based in China, global growth and planning for a long time, activelyrespond to the changes of external environment, adjust the focus of operation timely, seize the rare strategic development opportunitiesin the next three years and achieve leapfrog development. In 2021, the Company's overall business objective is to achieve a year-on -year 20% growth in sales revenue and net profit from main business.
2. Development objectives of self-owned brands
The self - owned brands is the long-term stable core competitiveness of the Company. The Company will continue to invest inpromoting its own brands, ensure sales revenue of its own brand products and total sales revenue ratio will continue to grow in 2021.
3. Cross border e-commerce development objective
Cross border e-commerce is the strategic core of the Company's continuous growth. The Company will actively integrate internaladvantages and resources, and increase the product category and service capacity of cross-border e-commerce in an orderly manner. In2021, cross-border e-commerce business will continue to maintain an above 50%. growth rate.
（3） Possible risks
The main business risks faced by the Company include:
1. Exchange rate fluctuation risk
Currently, majority of the Company's operating income is from the overseas market, such as the fluctuation of RMB exchangerate, which will have a certain impact on the Company's operating income. Most of the Company's main business orders aredenominated in US dollars, and the fluctuation of RMB against US dollar directly affects the price competitiveness of products, thusaffecting the Company's operating performance. In this regard, the Company will continue to strengthen overseas business growth andsettlement control of foreign exchange, hedge and reduce the impact of exchange rate fluctuations on the Company's performance.
2. Risk of rising raw material price
In recent years, the price of main raw materials fluctuates greatly, which causes the production cost of the Company to fluctuate.Although the Company mainly produces outsourcing capacity and has strong bargaining power for upstream outsourcing manufacturers,if the price of raw materials continues to rise, it may still have a certain impact on the profitability of the Company. In this regard, theCompany will continue to strengthen procurement and cost control, establish strategic cooperation relationship with suppliers and signlong-term agreements to absorb the risk of raw material price fluctuation risk; Meanwhile, we will continue to optimize the productstructure, strengthen the R & D of new and innovative products, set competitive market prices and maintain a stable gross profit rate.
3. Trade friction risk
At present, the United States is the largest single market of the Company. Some products exported to the United States are stillsubject to 25% tariff, which has a negative impact on the development of the Company. In this regard, the Company will pay closeattention to global geopolitical changes, continue to implement the international strategy, promote the construction of overseasmanufacturing base, cultivate overseas supply chain, establish a global capacity distribution and supply chain system, and ensure thestable development of the Company's business.X. Reception of Research, Communication, Interviews and Other Activities
1. Registration form for reception of research, communication, interviews and other during the reportingperiod
√ Applicable □ Not applicable
| Reception Date | Reception Site | Reception Mode | Reception Object | Reception Object | Information Discussed and Materials Provided | Disclosure index |
| May 18, 2020 | No.35 Jiuhuan Road, Shangcheng District, Hangzhou | Telephone communication | Other | Institutional and personal investors | The latest development of the Company | The latest development of the Company |
| May 19, 2020 | No.35 Jiuhuan Road, Shangcheng District, Hangzhou | Telephone communication | Other | Institutional and personal investors | The latest development of the Company | The latest development of the Company |
| May 20, 2020 | No.35 Jiuhuan Road, Shangcheng District, Hangzhou | Telephone communication | Other | Institutional and personal investors | The latest development of the Company | The latest development of the Company |
| May 21, 2020 | No.35 Jiuhuan Road, Shangcheng District, Hangzhou | Telephone communication | Other | Institutional and personal investors | The latest development of the Company | The latest development of the Company |
| May 25, 2020 | No.35 Jiuhuan Road, Shangcheng District, Hangzhou | Telephone communication | Other | Institutional and personal investors | The latest development of the Company | The latest development of the Company |
| June 16, 2020 | No.35 Jiuhuan Road, Shangcheng District, Hangzhou | Telephone communication | Other | Institutional and personal investors | The latest development of the Company | The latest development of the Company |
| June 17, 2020 | No.35 Jiuhuan Road, Shangcheng District, Hangzhou | Telephone communication | Other | Institutional and personal investors | The latest development of the Company | The latest development of the Company |
| June 19, 2020 | No.35 Jiuhuan Road, Shangcheng District, Hangzhou | Telephone communication | Other | Institutional and personal investors | The latest development of the Company | The latest development of the Company |
| August 28, 2020 | No.35 Jiuhuan Road, Shangcheng District, Hangzhou | Telephone communication | Other | Institutional and personal investors | The latest development of the Company | The latest development of the Company |
| August 31, 2020 | No.35 Jiuhuan Road, Shangcheng District, Hangzhou | Telephone communication | Other | Institutional and personal investors | The latest development of the Company | The latest development of the Company |
| September 1, | No.35 Jiuhuan Road, | Telephone | Other | Institutional and personal | The latest development of the | The latest development of the |
| 2020 | Shangcheng District, Hangzhou | communication | investors | Company | Company | |
| October 26, 2020 | No.35 Jiuhuan Road, Shangcheng District, Hangzhou | Telephone communication | Other | Institutional and personal investors | The latest development of the Company | The latest development of the Company |
| October 27, 2020 | No.35 Jiuhuan Road, Shangcheng District, Hangzhou | Telephone communication | Other | Institutional and personal investors | The latest development of the Company | The latest development of the Company |
| October 28, 2020 | No.35 Jiuhuan Road, Shangcheng District, Hangzhou | Telephone communication | Other | Institutional and personal investors | The latest development of the Company | The latest development of the Company |
| October 29, 2020 | No.35 Jiuhuan Road, Shangcheng District, Hangzhou | Telephone communication | Other | Institutional and personal investors | The latest development of the Company | The latest development of the Company |
| October 30, 2020 | No.35 Jiuhuan Road, Shangcheng District, Hangzhou | Telephone communication | Other | Institutional and personal investors | The latest development of the Company | The latest development of the Company |
Section 5 Significant EventsI. Profit Distribution to Common Shareholders & Increase of Share Capital due to Conversionof Equity ReservesStatus of formulation, execution, or adjustments made to profit distribution policy for common shareholders, especially the cashdividend policy, during the reporting period.
√ Applicable □ Not applicable
During the reporting period, the Company held the annual general meeting of shareholders in 2019 on May 14, 2020,deliberated and passed the "proposal on the Company's profit distribution plan in 2020". Considering the Company's strategicdevelopment plan, 2020 business plan and changes in the external environment, the Company's profit distribution plan in 2020 is: nocash dividend, no bonus shares in 2020, The remaining undistributed profits are carried forward to the next year.During the reporting period, the formulation and implementation of the Company's profit distribution policies were in line withthe relevant provisions of the notice on further implementing matters related to cash dividends of listed companies, the regulatoryguidelines for listed companies No. 3 - cash dividends of listed companies issued by the CSRC and the articles of association of theCompany. The relevant decision-making procedures and mechanisms were complete, and the independent director was diligent andresponsible, the legitimate rights and interests of small and medium shareholders have been fully safeguarded.
| Special Explanation of Cash Dividend Policy | |
| Does it comply with the requirements of the Company’s regulations or the resolutions of the shareholders’ meeting？ | Yes |
| Are the dividend standards and proportions specific and clear？ | Yes |
| Are relevant decision-making procedures and mechanisms complete？ | Yes |
| Do independent directors perform their duties and play their due role？ | Yes |
| Do minority shareholders have the opportunity to fully express their opinions and appeals, and are their legitimate rights and interests fully protected？ | Yes |
| Are the conditions and procedures compliant and transparent when the cash dividend policy was adjusted or changed？ | Yes |
shares on September 30, 2019, deducting the number of shares that the Company has bought back 10,799,651 shares, the Companywill distribute RMB 1.9 (tax included) for every 10 shares to all shareholders, with a total of RMB 202,245,129.31n in cash. Afterthe dividend distribution, the undistributed profit balance of the parent company is RMB 2,661,343,455.51 , which will be carriedforward to the following years for distribution. This profit distribution does not convert capital reserve into share capital, and doesnot give bonus shares.The profit distribution plan for 2019 is as follows: buy back 463,300 shares of the Company by means of centralized biddingtransaction, accounting for 0.0431% of the total share capital of the Company, and the total amount paid is RMB 5,500,089.06,which can be regarded as the cash dividend of the Company in 2019. In 2019, the Company will not distribute cash dividends, bonusshares, increase share capital by capital accumulation fund, and carry forward the remaining undistributed profits to the next year.
3. The profit distribution plan for 2018 is as follows: repurchase 10,336,351 shares of the Company by means of centralizedbidding transaction, accounting for 0.9613% of the total share capital of the Company, and the total amount paid is RMB99,992,601.00, which can be regarded as the cash dividend of the Company in 2018. In 2018, the Company will not distribute cashdividend, and will not convert capital reserve into the share capital, and the remaining undistributed profit will be carried forward tothe next year.Cash dividends of common stock of the Company in recent three years (including the report period)
Unit: RMB
| Year | Cash dividend (including tax) | Net profit attributable to common shareholders of the Company in consolidated statements | Cash dividend in proportion to net profit attributable to shareholders of the Company in consolidated statements (%) | Cash dividend in (such as share repurchase) other forms | Other forms of cash dividend it proportion to net profit attributable to shareholders of the Company in consolidated statements (%) | Total of Cash dividend (including other forms) | Total of cash dividend (including other forms) in proportion to net profit attributable to shareholders of the Company in consolidated statements (%) |
| 2020 | 0.00 | 1,350,132,516.91 | 0.00% | 0.00 | 0.00% | 0.00 | 0.00% |
| 2019 | 202,245,129.31 | 895,030,139.78 | 22.60% | 5,500,089.06 | 0.61% | 207,745,218.37 | 23.21% |
| 2018 | 0.00 | 716,999,484.04 | 0.00% | 99,992,601.00 | 13.95% | 99,992,601.00 | 13.95% |
| The reasons why the profit in the reporting period and the parent | Use and use plan of the Company's undistributed profits |
company's profit available for common shareholders' distributionare positive, but the cash dividend distribution plan of common
shares is not put forward
In order to better safeguard the interests of the Company and allshareholders and improve the sustainable development ability ofthe Company, the Company will have a large capital expenditurein 2021.
According to the Company's strategic development plan and2021 business plan, the Company will continue to strengthen itsinternational layout and select high-quality companies at homeand abroad for industrial merger and integration. At present, themerger and acquisition projects of assets of Joh. FriedrichBehrens AG and 100% shares of Geelong Holdings Limited areabout to be completed. Meanwhile, the construction ofproduction base in Southeast Asia is in a period of rapidconstruction, and the Company will have a large capitalexpenditure in 2021.
II. Proposal for Profit Distribution and Conversion of Capital Reserves into Share Capital forthe Reporting Period
□ Applicable √ Not applicable
The Company plans not to distribute cash dividends, bonus shares or increase share capital with accumulation fund.III. Fulfillment of Commitments
1. Commitments made by the Company’s actual controllers, shareholders, related parties, purchasers, andothers that were fulfilled during the reporting period and those not fulfilled as of the end of the reportingperiod
√ Applicable □ Not applicable
| Commitment | Committed By | Commitment Type | Commitment Details | Committed Time | Commitment Period | Fulfillment Status |
| Share reform commitment | ||||||
| Commitments made in acquisition report or equity change report | ||||||
| Commitments | GreatStar Group | Performance | According to the letter of commitment of Great Star Holding Group Co., Ltd. on profit compensation issued by GreatStar | June 4, 2019 | 2021-12-31 | Strictly |
| made during asset restructuring | commitment and compensation arrangement | Group on June 17, 2019, and the profit compensation agreement and supplementary agreement of profit compensation agreement signed with listed companies on August 15, 2019 and September 27, 2019 respectively, the main arrangements for performance compensation related to this transaction are as follows: 1. The profit compensation period of GreatStar Group to the listed company is the year when the transaction is completed and two consecutive accounting years after that, namely, 2019, 2020 and 2021 (hereinafter referred to as "profit compensation period"). 2. GreatStar Group undertakes that the total net profit attributable to the shareholders of the parent company after deducting non recurring profits and losses in the audited consolidated statements of Zhongce Rubber in the profit compensation period (2019, 2020 and 2021) shall not be less than RMB 3,128.7882 million (hereinafter referred to as "committed net profit"). 3. The benchmark date of profit compensation is December 31, 2021. A listed company shall, within 30 working days from the base date of profit compensation calculation, employ an accounting firm with relevant securities and futures business qualification to conduct a special audit on the total net profit attributable to the shareholders of the parent company (hereinafter referred to as "actual total net profit") of the consolidated statements of Zhongce Rubber in each year during the profit compensation period after deducting non recurring profits and losses, Based on this, the difference between the actual total net profit and the committed net profit of Zhongce Rubber during the profit compensation period is determined. 4. According to the special audit opinion issued by the accounting firm on the difference of profit forecast during the profit compensation period, if the actual total net profit of Zhongce Rubber during the profit compensation period is less than the promised net profit, GreatStar Group will compensate the listed company in cash, and the amount to be compensated = (committed net profit - actual total net profit during the profit compensation period) × 11.4438 %。 If GreatStar Group is liable for profit compensation in accordance with the provisions of the preceding paragraph, it shall pay cash compensation to the bank account designated by the listed company within 30 working days after the issuance of the special audit opinions and the written notice of compensation issued by the listed company. 5. GreatStar Group is willing to make a commitment to increase the net profit of the listed company (hereinafter referred to as "new net profit of synergy effect") in this | performing |
| transaction during the profit compensation period. GreatStar Group promises that the total net profit of the listed company will not be less than RMB 75.4941 million (hereinafter referred to as "the net profit of synergy commitment") due to the synergy effect of this transaction during the profit compensation period. 6. The benchmark date of profit compensation is December 31, 2021. A listed company shall, within 30 working days from the base date of profit compensation calculation, employ an accounting firm with relevant securities and futures business qualification to conduct a special audit on the new net profit of synergy effect realized by the listed company in each year during the profit compensation period, Based on this, the difference between the actual total net profit of synergy and the net profit promised by synergy is determined. 7. According to the special audit opinion issued by the accounting firm on the difference of synergy profit forecast during the profit compensation period, if the actual total net profit of synergy is less than the net profit promised by synergy, GreatStar Group will compensate the listed company in cash, The compensation amount should be equal to the net profit of synergy effect commitment - the actual total net profit of synergy effect during the profit compensation period. If GreatStar Group is liable for profit compensation in accordance with the provisions of the preceding paragraph, it shall pay cash compensation to the bank account designated by the listed company within 30 working days after the issuance of the special audit opinions and the written notice of compensation issued by the listed company. 8. If GreatStar Group fails to give full compensation to the listed company in time within the time limit specified in this agreement, it shall pay the listed company liquidated damages of 0.02% of the compensation amount in cash for each overdue day from the date of overdue until GreatStar Group has paid the compensation amount in full. | |||||
| Qiu Jianping；Wang Lingling | Reducing and standardizing related party transactions | 1. I and the enterprises I control will minimize the related transactions with the listed company, and will not use their status as the actual controller of the listed company to seek to give superior rights to other third parties in terms of business cooperation with the listed company. 2. The Company will not use its position as the controlling shareholder of the listed company to seek the right to enter a transaction with the listed company in priority. 3. If there is any necessary and unavoidable related transaction, the Company and the Company controlled enterprises will sign agreements with the listed | June 4, 2019 | Long-term | Strictly performing |
| company in accordance with the principles of fairness, fairness and equal compensation, perform legal procedures, and will perform the obligation of information disclosure and relevant internal decisions in accordance with the requirements of relevant laws and regulations and the provisions of the articles of association. The approval procedure ensures that the listed company will not be traded on the condition that it is obviously unfair compared with the market price, and that it will not use such transactions to engage in any act that damages the legitimate rights and interests of the listed company and other shareholders. | |||||
| GreatStar Group | Reducing and standardizing related party transactions | 1. The Company and the enterprises controlled by the Company will reduce the related party transactions with the listed companies as far as possible, and will not use its position as the controlling shareholder of the listed company to seek the rights superior to other third parties in business cooperation with the listed company. 2. The Company will not use its position as the controlling shareholder of the listed company to seek the right to enter into transactions with the listed company first. 3. If there are necessary and inevitable related party transactions, the Company and the enterprises controlled by the Company will sign agreements with the listed company in accordance with the principles of fairness, fairness and compensation for equal value, perform legal procedures, and perform the obligation of information disclosure and relevant internal decision-making and management in accordance with the requirements of relevant laws, regulations, normative documents and the articles of association. The approval procedure ensures that it will not trade with the listed company on terms that are obviously unfair compared with the market price, and will not use such transactions to engage in any act that damages the legitimate rights and interests of the listed company and other shareholders. | June 4,2019 | Long-term | Strictly performing |
| Qiu Jianping；Wang Lingling | Avoid horizontal competition | 1. I will not directly or indirectly engage in or participate in the business that constitutes potential direct or indirect competition with the listed company and its subordinate enterprises; Guarantee that legal and effective measures will be taken to urge other enterprises under my control not to engage in or participate in any business competing with the operation of the listed company and its subordinate enterprises. 2. If the listed company further expands its business scope, I and other enterprises under my control will not compete with the expanded business of the listed company; If it is possible to | Long-term | Strictly performing |
| compete with the expanded business of the listed company, I and other enterprises under my control will withdraw from the competition with the listed company in the following ways: A. stop the business that competes with or may compete with the listed company; B. Bring competitive businesses into the listed companies to operate; C. Transfer competing businesses to unrelated third parties. 3. If I and other enterprises under my control have any business opportunities to engage in and participate in any activities that may compete with the operation of the listed company, I will immediately notify the listed company of the above business opportunities. Within a reasonable period specified in the notice, the listed company will give a positive reply that it is willing to take advantage of the business opportunities, Then try to give the business opportunity to the listed company. 4. If I violate the above commitments, I am willing to bear all the responsibilities arising therefrom and fully compensate or compensate all the direct or indirect losses caused to the listed company. | |||||
| GreatStar Group | Avoid horizontal competition | 1. The Company does not engage in or participate in the business which is potentially directly or indirectly competitive with the business of listed companies and their subordinate enterprises in a direct or indirect way; Ensure that legal and effective measures will be taken to prevent other enterprises under the control of the Company from engaging in and participating in any business that competes with the operation of the listed company and its subordinate enterprises. 2. If the listed company further expands its business scope, the Company and other enterprises controlled by the Company will not compete with the business after the expansion of the listed company; If there is any competition with the business after the expansion of the listed company, the Company and other enterprises controlled by the Company will exit the competition with the listed company in the following ways: A. stop the business which is competitive with the listed company or may constitute competition; B. Bring competitive businesses into the listed companies to operate; C. Transfer competing businesses to unrelated third parties. 3. If the Company and other enterprises under the control of the Company have any business opportunity to engage in and participate in any activities which may compete with the operation of the listed company, the listed company shall immediately notify the listed company of the above business opportunities, and within the reasonable period specified in the notice, the listed company shall make a positive reply willing to use the business opportunity, Then try | June 4, 2019 | Long-term | Strictly performing |
| to give the business opportunity to the listed company. 4. In case of breach of the above commitments, the Company is willing to bear all the responsibilities arising therefrom, and fully compensate or compensate all direct or indirect losses caused to the listed company. | |||||
| Qiu Jianping;Wang Lingling | Guarantee the independence of listed company | I promise that after the completion of this transaction, the listed company will continue to improve the corporate governance structure and independent operation company management system in accordance with relevant laws and regulations and the requirements of the articles of association, and continue to maintain the independence of the listed company in business, assets, finance, institutions, personnel, etc., and effectively protect the interests of all shareholders. | June 4, 2019 | Long-term | Strictly performing |
| GreatStar Group | Guarantee the independence of listed company | The Company promises that after the completion of this transaction, it will ensure that the listed company will continue to improve the corporate governance structure and the Company management system of independent operation in accordance with the requirements of relevant laws and regulations and the articles of association, continue to maintain the independence of the listed company in business, assets, finance, institutions and personnel, and effectively protect the interests of all shareholders. | June 4, 2019 | Long-term | Strictly performing |
| All directors and senior management of the Company | Other commitments | 1. I promise not to deliver benefits to other companies or individuals free of charge or under unfair conditions, nor to damage the Company's interests in other ways. 2. I promise to restrict my duty consumption behavior. 3. I promise not to use the Company's assets to engage in investment and consumption activities unrelated to the performance of my duties. 4. I promise that the salary system formulated by the Board of Directors or the Salary and Assessment Committee will be linked with the implementation of the Company's compensation measures. In case of any loss to the Company or shareholders caused by the violation of the above commitment, I will bear the responsibility of compensation according to law. | June 4, 2019 | Long-term | Strictly performing |
| GreatStar Group | Other commitments | 1. It will not interfere in the Company's operation and management activities beyond its authority, and will not encroach on the Company's interests. 2. From the date of issuing this commitment to the completion of the transaction, when the CSRC makes clear provisions on the measures to fill in the return and its commitment, and the above commitment can not meet the requirements of the CSRC, the commitment will issue a supplementary commitment in accordance with the provisions of the CSRC. 3. The Company will strictly | June 4, 2019 | Long-term | Strictly performing |
| implement the measures to fill the diluted immediate return. If it fails to do so, it will publicly explain the specific reasons for the failure to fill the diluted immediate return at the general meeting of shareholders of the Company and apologize to shareholders and public investors of the Company; If investors suffer losses in securities trading due to failure to fulfill relevant commitments, they will be compensated according to law. In case of any loss caused to the Company or the shareholders due to the violation of the above commitment, the Company will bear the compensation responsibility according to law. | ||||||
| Qiu Jianping;Wang Lingling | Other commitments | 1. It will not interfere in the Company's operation and management activities beyond its authority, and will not encroach on the Company's interests. 2. From the date of issuing this commitment to the completion of the transaction, when the CSRC makes clear provisions on the measures to fill in the return and its commitment, and the above commitment can not meet the requirements of the CSRC, the commitment will issue a supplementary commitment in accordance with the provisions of the CSRC. 3. I will strictly perform the measures to fill the diluted immediate return. If I fail to do so, I will publicly explain the specific reasons for my failure to fill the diluted immediate return at the general meeting of shareholders of the Company and apologize to the shareholders and public investors of the Company; If investors suffer losses in securities trading due to failure to fulfill relevant commitments, they will be compensated according to law. In case of any loss to the Company or shareholders caused by the violation of the above commitment, I will bear the responsibility of compensation according to law. | June 4, 2019 | Long-term | Strictly performing | |
| Initial public offering or refinancing commitments | All directors and senior management of the Company | Other commitments | 1. Promise not to deliver benefits to other companies or individuals free of charge or under unfair conditions, and not to damage the interests of the Company in other ways. 2. Promise to restrict the duty consumption behavior of directors and senior executives. 3. Promise not to use the Company's assets to engage in investment and consumption activities unrelated to the performance of its duties. 4. It is committed that the compensation system formulated by the Board of Directors or the compensation committee is linked to the implementation of the Company's compensation measures. 5. If the Company implements the stock incentive plan in the future, it promises that the exercise conditions of the future stock incentive plan will be linked with the implementation of the Company's | November 23, 2018 | Long-term | Strictly performing |
| compensation return measures. As one of the subjects responsible for filling the return measures, if I violate the above commitment or refuse to fulfill the above commitment, I agree to punish or take relevant management measures in accordance with the relevant regulations and rules formulated or issued by the CSRC, Shenzhen Stock Exchange and other securities regulatory agencies, and I am willing to bear the corresponding legal responsibility. | |||||
| GreatStar Group | Other commitments | Promise not to interfere in the Company's operation and management activities beyond authority and not to encroach on the Company's interests. As one of the main bodies responsible for filling the return measures, if the Company violates the above commitment or refuses to fulfill the above commitment, the Company agrees to punish the Company or take relevant management measures in accordance with the relevant regulations and rules formulated or issued by the CSRC, Shenzhen Stock Exchange and other securities regulatory agencies, and is willing to bear the corresponding legal responsibility. | November 23, 2018 | Long-term | Strictly performing |
| Qiu Jianping;Wang Lingling | Other commitments | Promise not to interfere in the Company's operation and management activities beyond authority and not to encroach on the Company's interests. As one of the subjects responsible for filling the return measures, if I violate the above commitment or refuse to fulfill the above commitment, I agree to make relevant punishment or take relevant management measures in accordance with the relevant regulations and rules formulated or issued by the CSRC, Shenzhen Stock Exchange and other securities regulatory agencies, and I am willing to bear the corresponding legal responsibility. | November 23, 2019 | Long-term | Strictly performing |
| GreatStar Group | Commitments on horizontal competition, related party transactions and capital occupation | During its period as the controlling shareholder of the issuer, Great Star Holding Group Co., Ltd. and its enterprises directly or indirectly controlled in the future will not operate in any form (including but not limited to investment, merger and acquisition, joint venture, joint venture, cooperation, partnership, contracting or leasing operation, purchase of shares of listed companies etc.) within or outside China to engage in or participate in the business or activities that constitute or may constitute a substantial competitive relationship with the main business of the issuer, and will not support the third party other than the issuer and its wholly-owned and holding subsidiaries to engage in or participate in the business or activities that constitute or may constitute a substantial competitive relationship with the main business of the issuer in any form | April 5, 2009 | As the controlling shareholder of the Company | Strictly performing |
| within or outside China. Great Star Holding Group Co., Ltd. will compensate the issuer for all actual losses caused to the issuer due to the failure to fulfill the promises and guarantees made in the letter of commitment. | ||||||
| Qiu Jianping;Wang Lingling | Commitments on horizontal competition, related party transactions and capital occupation | During the period when they have the actual control of the issuer, Qiu Jianping and his wife and other enterprises directly or indirectly controlled by them, except the issuer and its wholly-owned and holding subsidiaries, will not operate in any form (including but not limited to investment, merger and acquisition, joint venture, cooperation, partnership, contracting or leasing operation, purchase of shares of listed companies) within or outside China to engage in or participate in the business or activities that constitute or may constitute a substantial competitive relationship with the main business of the issuer, and will not support the third party other than the issuer and its wholly-owned and holding subsidiaries to engage in or participate in the business or activities that constitute or may constitute a substantial competitive relationship with the main business of the issuer in any form within or outside China. In case of any loss caused to the issuer due to the failure to fulfill the promises and guarantees made in the commitment letter, Qiu Jianping and his wife will compensate the issuer for all actual losses. | April 5, 2010 | As the actual controller of the Company | Strictly performing | |
| Equity incentive commitment | ||||||
| Other commitments to small and medium shareholders of the Company | ||||||
| Whether the commitment is fulfilled on time | Yes | |||||
IV. Status of Capital of the Listed Company Used for Non-operating Purposes by theControlling Shareholder or Its Related Parties
□ Applicable √ Not applicable
In the reporting period, no controlling shareholder or its related party used capital of the listed Company for non-operating purposes.V. Explanations Provided by the Board of Directors, the Supervisory Committee, and theIndependent Directors (If Any) Regarding the “Non-standard Audit Report” Issued by theAuditor for the Reporting Period
□ Applicable √ Not applicable
VI. Changes in Accounting Policy, Estimation, and Methods When Compared to the PreviousFinancial Year
√ Applicable □ Not applicable
1. The Company will implement the accounting standards for Business Enterprises No. 14 - Revenue (hereinafter referred to asthe new revenue standards) revised by the Ministry of finance from January 1, 2020. According to the relevant provisions on theconnection between the new and old standards, the information of the comparable period will not be adjusted, and thecumulative impact of the implementation of the new standards on the first implementation date will retroactively adjust theamount of retained earnings and other related items in the financial statements at the beginning of the reporting period.The main impacts of the implementation of the new income standard on the Company's financial statements as of January 1, 2020 areas follows:
Unit: RMB
2. Since January 1, 2020, the Company has implemented the No. 13 interpretation of accounting standards for business enterprisesissued by the Ministry of Finance in 2019, and the accounting policy change is handled by the future applicable law.
VII. Retrospective Restatement due to Correction of Material Accounting Errors in theReporting Period
□ Applicable √ Not applicable
No such cases in the reporting period.
| item | Balance sheet | ||
| December 31, 2019 | Impact of new income standard adjustment | January 1, 2020 | |
| Advance payment | 56,674,240.40 | -56,674,240.40 | |
| Contractual liliabilities liabilitiesliabilities | 56,674,240.40 | 56,674,240.40 | |
VIII. Changes in Consolidation Scope When Compared to the Previous Financial Year
√ Applicable □ Not applicable
For details of the changes in the Company’s scope of consolidation in 2020, refer to “ V. Changes in the Scope Consolidation ” of“ Chapter 12 Financial Report ” .IX. Details Regarding Engagement and Disengagement of AuditorAuditor engaged at present
| Name of domestic auditor | Pan-China Certified Public Accountants LLP (special general partnership) |
| Fee for domestic auditor (RMB million) | 80 |
| Consecutive years of audit services provided by the domestic auditor | 12 years |
| Names of the certified public accountants from auditor | Chen Zhongjiang, Hu Fujian |
| Consecutive years of audit services provided by the Certified Public Accountants of domestic auditor | 12 years |
| Basic information of litigation (Arbitration) | Amount involved (RMB10,000 ) | Whether to form estimated liabilities | Progress in litigation (Arbitration) | The result and influence of litigation (Arbitration) | Implementation of litigation (Arbitration) judgment | Date of disclosure | Disclosure index |
| Zhejiang GreatStar Industrial Co., Ltd. v. labor security administrative confirmation case of Haining human resources and Social Security Bureau | 0 | No | Case closed | The plaintiff withdrew the suit | The plaintiff withdrew the suit | (2019) zhe0424 xingchu no.266 |
4. Credits and liabilities with related parties
□ Applicable √ Not applicable
No such cases in the reporting period.
5. Other significant related-party transactions
□ Applicable √ Not applicable
No such cases in the reporting period.
XVII. Significant Contracts and Their Execution
1. Trusteeships, Contracts, and Leases
(1) Trusteeships
□ Applicable √ Not applicable
No significant trusteeships in the reporting period.
(2) Contracts
□ Applicable √ Not applicable
No significant contracts in the reporting period.
(3) Leases
□ Applicable √ Not applicable
No significant leases in the reporting period.
2. Significant guarantees
√ Applicable □ Not applicable
(1) Guarantees provided by the Company
Unit: RMB10 thousands
| The listed Company and its subsidiaries’ guarantees to external parties (Guarantees to subsidiaries are not included) | ||||||||
| Guarantee party | Disclosure date of Quota announcement | Amount of guaranteed Quota approved | Actual date of occurrence | Actual guarantee amount | Type of guarantee | Period of guarantee | Executed？ | Guarantee for a related party？ |
| The listed Company’s guarantees to subsidiaries | ||||||||
| Guarantee party | Disclosure date of Quota announcement | Amount of guaranteed Quota approved | Actual date of occurrence | Actual guarantee amount | Type of guarantee | Period of guarantee | Executed？ | Guarantee for a related party？ |
| Arrow Fastener Co., LLC | 2019/10/29 | 3,262.45 | 2019/11/09 | 3,262.45 | General warranty | 1 year | Yes | Yes |
| GreatStar Europe AG | 2018/07/03 | 52,965 | 2018/08/31 | 38,921.25 | General warranty | 2018/8/31-2023/6/26 | No | Yes |
| Suzhou Xindadi Hardware Products Co., Ltd | 2020/06/22 | 10,000 | 2021/01/07 | 0 | General warranty | 3 years | No | Yes |
| Arrow Fastener Co., LLC | 2020/10/22 | 3,262.45 | 2020/10/22 | 3,262.45 | General warranty | 1year | No | Yes |
| Total guarantee quota approved for subsidiaries during the reporting period (B1) | 13,262.45 | Total actual amount of guarantees for subsidiaries during the reporting period (B2) | 45,446.15 | |||||
| Total guarantee quota approved for the subsidiaries at the end of the reporting period (B3) | 66,227.45 | Total actual guarantee balance for subsidiaries at the end of the reporting period (B4) | 42,183.7 | |||||
| Subsidiary’s guarantees to subsidiaries | ||||||||
| Guarantee party | Disclosure date of Quota announcement | Amount of guaranteed Quota approved | Actual date of occurrence | Actual guarantee amount | Type of guarantee | Period of guarantee | Executed？ | Guarantee for a related party？ |
| Total guarantee amount provided by the Company(i.e. the total of the first three items) | ||||||||
| Total guarantee quota approved during the reporting period (A1+B1+C1) | 13,262.45 | Total actual amount of guarantee during the reporting period (A2+B2+C2) | 45,446.15 | |||||
| Total guarantee quota approved at the end of the reporting period (A3+B3+C3) | 66,227.45 | Total actual guarantee balance at the end of the reporting period (A4+B4+C4) | 42,183.7 | |||||
| Total guarantee amount (A4+B4+C4) to net assets of the Company | 4.78% | |||||||
Of which:
Description of the specific situation of adopting compound guarantee
(2) Illegal provision of guarantees for external parties
□ Applicable √ Not applicable
No such cases in the reporting period.
3. Cash assets managed under trust
(1) Wealth managed under trust
√ Applicable □ Not applicable
Entrusted finances during the reporting period
Unit: RMB10 thousands
| Type | Funding Source for Entrusted Funds | Maximum Daily Balance of Such Entrusted Funds During the Reporting Period | Unexpired Balance | Overdue Outstanding Amount |
| Bank wealth management products | Self-owned fund | 73,670 | 39,200 | 0 |
| Total | 73,670 | 39,200 | 0 | |
No other significant contracts in the reporting period.XVIII. Social Responsibilities
1. Performance of Social Responsibilities
(1) Protection of the rights and interests of shareholders and creditors
During the reporting period, the Company further strengthened the standardized operation, established and improved the corporategovernance structure, standardized the management of the convening, holding and discussion procedures of the general meeting ofshareholders, and ensured the shareholders' right to know, participate and vote on major issues of the Company; Constantly improvecompany's the Company internal control system, modify company's the Company external financial assistance management systemaccording to relevant regulations; We should conscientiously perform the obligation of information disclosure, ensure the authenticity,accuracy, integrity, timeliness and fairness of information disclosure, refrain from selective information disclosure, strictly implementthe insider registration and insider confidentiality system, and treat all shareholders and investors fairly; Strengthen the managementof investor relations, communicate with investors through investor relations interactive platform, hotline and other ways, so as to protectthe legitimate rights and interests of all shareholders of the Company, especially small and medium shareholders.
(2) Protection of employees' rights and interests
The Company adheres to the people-oriented principle, takes the talent strategy as the focus of enterprise development, strictlyabides by the labor law, the law on the protection of women's rights and interests and other relevant laws and regulations, paysemployees' pension, medical, unemployment, work-related injury, childbirth and other social insurance on time, respects and protectsemployees' personal rights and interests, and pays close attention to employees' health, safety and satisfaction. The Company attachesgreat importance to personnel training, and regularly organizes safety production knowledge training, basic skills training for each post,and comprehensive quality training for management personnel, so that employees can effectively improve their overall professionalquality and comprehensive quality, realize the common growth of employees and enterprises, and build a harmonious and stable laborrelations.
(3) Protection of rights and interests of suppliers, customers and consumers
The Company has always followed the trading principle of "honesty, mutual benefit, legality and compliance", paid attention tocommunication and coordination with all relevant parties, fully respected and protected the legitimate rights and interests of suppliersand customers, and established strategic partnership with suppliers and customers. The Company continues to improve the procurementsystem and process. In the selection of suppliers, the Company has established a fair and impartial evaluation system to select qualified
suppliers. The Company adheres to the supremacy of customer interests, strictly controls product quality, constantly improves servicequality, and always pays attention to product safety, so that the rights and interests of all parties have been properly protected.
(4) Environmental protection
The Company attaches great importance to environmental protection and takes environmental protection, energy conservation andemission reduction as an important work. During the reporting period, the Company carried out effective comprehensive treatment ofwaste water and waste gas in strict accordance with relevant environmental regulations and corresponding standards, and the wastewater and waste gas treatment facilities operated normally. In order to strengthen the management of emission reduction and pollutioncontrol, the Company carries out regular inspection, and the overall operation of environmental protection facilities is good, and thework of energy conservation and emission reduction is carried out orderly.
2. Targeted Poverty Alleviation Program
（1）Targeted poverty alleviation plan
N/A
（2）Annual poverty alleviation summary
N/A
（3）Targeted poverty alleviation
| index | Unit of measurement | Quantity / status |
| 1. General situation | —— | —— |
| 2. Itemized input | —— | —— |
| (1) Industrial development and poverty alleviation | —— | —— |
| (2) Transfer employment to get rid of poverty | —— | —— |
| (3) Moving out of poverty | —— | —— |
| (4) Poverty alleviation through education | —— | —— |
| (5) Poverty alleviation through health | —— | —— |
| (6) Ecological protection and poverty alleviation | —— | —— |
| (7) Protection | —— | —— |
| (8) Social poverty alleviation | —— | —— |
| (9) Other projects | —— | —— |
| 3. Awards (content, level) | —— | —— |
Section 6 Share Changes and Shareholder DetailsI. Changes in Shares
1. Changes in shares
Unit: shares
| Before Change | Increase or Decrease (+ or -) | After Change | |||||||
| Number of shares | Proportion | New shares issued | Bonus shares | Conversion of equity reserve into share capital | Others | Subtotal | Number of shares | Proportion | |
| I. Restricted sales of shares | 63,392,076 | 5.90% | -673,387 | -673,387 | 62,718,689 | 5.83% | |||
| 1. Shares held by state | 0 | 0.00% | 0 | 0 | 0 | 0.00% | |||
| 2. Shares held by state-owned legal person | 0 | 0.00% | 0 | 0 | 0 | 0.00% | |||
| 3. Other shares held by domestic capital | 63,392,076 | 5.90% | -673,387 | -673,387 | 62,718,689 | 5.83% | |||
| Of which: Other shares held by domestic legal person | 0 | 0.00% | 0 | 0 | 0 | 0.00% | |||
| Other shares held by domestic natural person | 63,392,076 | 5.90% | -673,387 | -673,387 | 62,718,689 | 5.83% | |||
| 4. Shares held by overseas capital | 0 | 0.00% | 0 | 0 | 0 | 0.00% | |||
| Of which: Other shares held by overseas legal person | 0 | 0.00% | 0 | 0 | 0 | 0.00% | |||
| Other shares held by overseas natural person | 0 | 0.00% | 0 | 0 | 0 | 0.00% | |||
| II. Unrestricted sales of shares | 1,011,855,624 | 94.10% | 673,387 | 673,387 | 1,012,529,011 | 94.17% | |||
| 1. RMB-denominated ordinary shares | 1,011,855,624 | 94.10% | 673,387 | 673,387 | 1,012,529,011 | 94.17% | |||
| 2.overseas capital shares domestic listed | 0 | 0.00% | 0 | 0 | 0 | 0.00% | |||
| 3、overseas capital shares overseas listed | 0 | 0.00% | 0 | 0 | 0 | 0.00% | |||
| 4、Others | 0 | 0.00% | 0 | 0 | 0 | 0.00% | |||
| III. Total number of shares | 1,075,247,700 | 100.00% | 0 | 0 | 1,075,247,700 | 100.00% |
| Name of shareholder | Restricted shares at the beginning of the period | Number of restricted shares increased in the period | Number of restricted shares removed in the period | Restricted shares at the end of the period | Restricted sales reasons | Date of restricted sales removal |
| Yu Wentian | 411,457 | 137,153 | 0 | 548,610 | The term of office has expired | 2021-03-01 |
| He Tianle | 270,180 | 0 | 270,180 | 0 | Early resignation during term of office | 2020-07-01 |
| Chen Hangsheng | 540,360 | 0 | 540,360 | 0 | Early resignation during term of office | 2020-07-01 |
| Total | 1,221,997 | 137,153 | 810,540 | 548,610 | -- | -- |
II. Issuance and Listing of Securities
1. Issuance of securities (excluding preferred shares) during the reporting period
√ Applicable □ Not applicable
| Names of stocks and their derivatives | Issue date | Issue price (or interest rate) | Number of issues | Listing date | Number of approved listed transactions | Transaction termination date | Disclosure index | Date of disclosure |
| Stocks | ||||||||
| Convertible bonds，Convertible bonds traded separately，Corporate bonds | ||||||||
| convertible bond | June 24, 2020 | RMB100 / unit | 9,726,000 | July 16, 2020 | 9,726,000 | February 24, 2021 | For details, please refer to the Company's publication in CNKI Net（ www.cninfo.com.cn ）Of Convertible bond listing company Notice No.: 2020-05 | July 15, 2020 |
| Other derivative securities | ||||||||
2. Explanation on changes in share capital, structure of shareholders, and structure of assets and liabilities
□ Applicable √ Not applicable
3. Existing shares held by internal employees of the Company
□ Applicable √ Not applicable
III. Shareholder and Actual Controller Details
1. Total number of shareholders and their holdings
Unit: number of shares
| Total number of shareholders at the end of reporting period | 31,763 | Total number of shareholders on the end of last month before the disclosure date of the annual report | 31,825 | Total number of preferred shareholders with voting rights restored (if any) | 0 | Total number of preferred stockholders with voting rights restored on the on the end of last month before the disclosure date of the annual report (if any) | 0 | |||||||
| Shareholders holding more than 5% of shares or shares of the top 10 shareholders | ||||||||||||||
| Name of shareholder | Type of shareholder | Shareholding percentage | Number of shares held at the end of the reporting period | Increase or decrease of shares during reporting period | Number of restricted shares held | Number of non- restricted shares held | Pledged or frozen shares | |||||||
| Status of shares | Amount | |||||||||||||
| Great Star Holding Group Co., Ltd. | Domestic non state-owned legal person | 43.13% | 463,739,864 | -20,000,000 | 0 | 463,739,864 | ||||||||
| Qiu Jianping | Domestic natural person | 5.66% | 60,884,300 | 0.00 | 45,663,225 | 15,221,075 | ||||||||
| Hong Kong Securities Clearing Company Limited | Overseas legal person | 3.07% | 33,014,961 | 24,003,926 | 0 | 33,014,961 | ||||||||
| Central Huijin Asset Management Co., Ltd | state-owned artificial person | 2.10% | 22,557,100 | 0.00 | 0 | 22,557,100 | ||
| China Merchants Bank Co., Ltd. - Ruiyuan growth value hybrid securities investment fund | Other | 1.70% | 18,231,485 | 18,231,485 | 0 | 18,231,485 | ||
| Wang Lingling | Domestic natural person | 1.60% | 17,150,960 | 0.00 | 12,863,220 | 4,287,740 | ||
| Agricultural Bank of China Limited - harvest emerging industries equity securities investment fund | Other | 1.46% | 15,669,987 | 15,669,987 | 0 | 15,669,987 | ||
| Agricultural Bank of China Limited - harvest core growth hybrid securities investment fund | Other | 1.23% | 13,216,656 | 13,216,656 | 0 | 13,216,656 | ||
| China Construction Bank Co., Ltd. - bocom Schroeder economic new power hybrid securities investment fund | Other | 1.22% | 13,108,040 | 13,108,040 | 0 | 13,108,040 | ||
| China Merchants Bank Co., Ltd. - Ruiyuan balanced value three year holding period hybrid securities investment fund | Other | 1.03% | 11,111,465 | 11,111,465 | 0 | 11,111,465 | ||
| Additional Shares Strategic investor or general legal person becomes the top 10 shareholder due to the placement of new shares (if any)（refer to note3） | N/A | |||||||
| Explain any associated relationship and/ or persons acting in concert between the above-mentioned shareholders | Great Star Holding Group Co., Ltd., Qiu Jianping and Wang Lingling are affiliated, and they are the persons acting in concert as stipulated in the administrative measures for the acquisition of listed companies. | |||||||
| Explanation of the above-mentioned shareholders’ involvement in entrustment/ entrusted voting rights and abstaining from voting rights | N/A | |||||||
| Top 10 shareholders holding unrestricted shares | |||
| Name of shareholder | Number of unrestricted shares held at the end of the reporting period | Type of shares | |
| Type of shares | Quantity | ||
| Great Star Holding Group Co., Ltd. | 463,739,864 | RMB-denominated ordinary shares | 463,739,864 |
| Hong Kong Securities Clearing Company Limited | 33,014,961 | RMB-denominated ordinary shares | 33,014,961 |
| Central Huijin Asset Management Co., Ltd | 22,557,100 | RMB-denominated ordinary shares | 22,557,100 |
| China Merchants Bank Co., Ltd. - Ruiyuan growth value hybrid securities investment fund | 18,231,485 | RMB-denominated ordinary shares | 18,231,485 |
| Agricultural Bank of China Limited - harvest emerging industries equity securities investment fund | 15,669,987 | RMB-denominated ordinary shares | 15,669,987 |
| Qiu Jianping | 15,221,075 | RMB-denominated ordinary shares | 15,221,075 |
| Agricultural Bank of China Limited - harvest core growth hybrid securities investment fund | 13,216,656 | RMB-denominated ordinary shares | 13,216,656 |
| China Construction Bank Co., Ltd. - bocom Schroeder economic new power hybrid securities investment fund | 13,108,040 | RMB-denominated ordinary shares | 13,108,040 |
| China Merchants Bank Co., Ltd. - Ruiyuan balanced value three year holding period hybrid securities investment fund | 11,111,465 | RMB-denominated ordinary shares | 11,111,465 |
| China Merchants Bank Co., Ltd. - Bank of communications Schroeder innovation pilot hybrid securities investment fund | 9,894,626 | RMB-denominated ordinary shares | 9,894,626 |
| Explain any associated relationship and/or persons acting in concert between the top ten shareholders | Great Star Holding Group Co., Ltd., Qiu Jianping and Wang Lingling are affiliated, and they are the persons acting in concert as stipulated in the administrative measures for the acquisition of listed companies. | ||
| Explain the top 10 common shareholders’ participation in margin financing (if any)(refer to note 4) | N/A | ||
□ Yes √ No
No such cases in the reporting period.
2. Details about the controlling shareholder
Nature of ultimate controlling shareholders: natural personType of controlling shareholders: natural person
| Name of controlling shareholder | Nationality | Obtained the Right of Sanctuary in Other Countries or Regions？ |
| Qiu Jianping | China | No |
| Major occupations and jobs | The chairman of the Company, the chairman of GreatStar Group | |
| Equity of other domestic and foreign listed companies holding shares or participating in shares during the reporting period | Hangcha Group Co., Ltd., stock code: 603298, stock abbreviation: Hangcha Group, which was listed on the Shanghai Stock Exchange on December 27, 2016, mainly engaged in forklift, intelligent vehicles and other industrial vehicle products and major components. | |
| Name of actual controller | Relationship wit the actual controller | Nationality | Obtained the Right of Sanctuary in Other Countries or Regions？ |
| Qiu Jianping | Himself | China | No |
| Major occupations and jobs | The chairman of the Company， the chairman of GreatStar Group | ||
| Domestic and foreign-listed companies with shares held by the actual controller in the past 10 years | Qiu Jianping is the actual controller of Hangcha Group Co., Ltd. (603298). | ||
The actual controller controlled the Company by trust or other asset management methods
□ Applicable √ Not applicable
4. Other institutional shareholders owning over 10% of shares
□ Applicable √ Not applicable
5. Details of restrictions on shareholdings of controlling shareholders, actual controllers, restructuringparties, and other commitment subjects
□ Applicable √ Not applicable
Section 7 Preferred Shares
□ Applicable √ Not applicable
No such cases in the reporting period.
Section 8 Convertible Corporate Bonds
√ Applicable □ Not applicable
I. Previous Adjustments of Stock Conversion PriceThe initial conversion price of the convertible bonds issued this time is RMB 12.28 / share. As of the end of the reporting period,the conversion price has not been adjusted.II. Share Conversions (Cumulative)
□ Applicable √ Not applicable
III. Top 10 Holders of the Convertible Bond
Unit: shares
| No. | Name of convertible bond holder | The nature of convertible bond holders | Number of convertible bonds held at the end of the reporting period | Amount of convertible bonds held at the end of the reporting period (RMB) | Proportion of convertible bonds held at the end of the reporting period |
| 1 | Shanghai Pudong Development Bank Co., Ltd. - EFund Yuxiang return bond securities investment fund | Other | 544,669 | 54,466,900.00 | 5.60% |
| 2 | China Merchants Bank Co., Ltd. - Ruiyuan balanced value three year holding period hybrid securities investment fund | Other | 543,502 | 54,350,200.00 | 5.59% |
| 3 | Industrial and Commercial Bank of China Co., Ltd. - Xingquan convertible bond hybrid securities investment fund | Other | 345,732 | 34,573,200.00 | 3.55% |
| 4 | Industrial and Commercial Bank of China Limited huitianfu convertible bond securities investment fund | Other | 338,510 | 33,851,000.00 | 3.48% |
| 5 | China Merchants Bank Co., Ltd. - Ruiyuan growth value hybrid securities investment fund | Other | 278,426 | 27,842,600.00 | 2.86% |
| 6 | Guorong Securities Co., Ltd | State-owned legal person | 272,999 | 27,299,900.00 | 2.81% |
| 7 | China Growth Securities Investment Fund | Other | 243,809 | 24,380,900.00 | 2.51% |
| 8 | Agricultural Bank of China Co., Ltd. - Penghua convertible bond securities investment fund | Other | 222,270 | 22,227,000.00 | 2.29% |
| 9 | Agricultural Bank of China Co., Ltd. - South Xiyuan convertible bond securities investment fund | Other | 216,511 | 21,651,100.00 | 2.23% |
| 10 | Shanghai Pudong Development Bank Co., Ltd. – Efund richeng flexible allocation of mixed securities investment fund | Other | 204,863 | 20,486,300.00 | 2.11% |
| item | 2020 | 2019 | Range of change |
| Asset liability ratio | 33.93% | 31.58% | 2.35% |
| Interest cover | 23.37 | 22.47 | 4.01% |
| Loan repayment rate | 100% | 100% | - |
| Interest repayment rate | 100% | 100% | - |
3. Cash arrangement for debt repayment in future years
As of the disclosure date of this report, the Company has fully redeemed the "GreatStar convertible bonds" registered after theclosing of the market as of the redemption registration date (February 23, 2021), and completed the payment of the redemption money.There is no cash arrangement for repayment of principal and interest in future years.
Section 9 Directors, Supervisors, Senior Management and EmployeesI. Changes in Shares Held by Directors, Supervisors and Senior Executives
| Name | Title | Tenure status | gender | Age | Start date | End date | Shares held at the beginning of the period (share) | Quantity Of shares increased in the current period (share) | Quantity of shares decreased in the current period (share) | Other increased or decreased changes (share) | Quantity of shares held at the end of the period (share) |
| Qiu Jianping | Chairman | Current | Male | 59 | June 16, 2008 | August 30,2023 | 60,884,300 | 0 | 0 | 0 | 60,884,300 |
| Chi Xiaoheng | Deputy chairman, general manager | Current | Female | 46 | August 31,2020 | August 30,2023 | 829,950 | 0 | 100,000 | 0 | 729,950 |
| Wang Lingling | Director, Deputy chairman | Current | Female | 60 | June 16, 2008 | August 30,2023 | 17,150,960 | 0 | 0 | 0 | 17,150,960 |
| Li Zheng | Director, Deputy chairman | Current | Male | 62 | June 16,2008 | August 30,2023 | 901,960 | 0 | 225,490 | 0 | 676,470 |
| Xu Zheng | Director | Current | Female | 37 | June 16,2008 | August 30,2023 | 0 | 0 | 0 | 0 | 0 |
| Cen Zhengping | Director | Current | Male | 59 | May 24,2019 | August 30,2023 | 0 | 0 | 0 | 0 | 0 |
| Wang Gang | Independent director | Current | Male | 46 | August 31,2020 | August 30,2023 | 0 | 0 | 0 | 0 | 0 |
| Chen Zhimin | Independent director | Current | Female | 61 | August 31,2020 | August 30,2023 | 0 | 0 | 0 | 0 | 0 |
| Shi Hong | Independent director | Current | Female | 58 | August 31,2020 | August 30,2023 | 0 | 0 | 0 | 0 | 0 |
| Jiang Saiping | Chairman of the Supervisory Committee | Current | Female | 50 | June 15, 2011 | August 30,2023 | 0 | 0 | 0 | 0 | 0 |
| Fu Yajuan | Supervisor | Current | Female | 49 | August 31,2020 | August 30,2023 | 0 | 0 | 0 | 0 | 0 |
| Chen Jun | Supervisor | Current | Male | 41 | June 15, 2011 | August 30,2023 | 0 | 0 | 0 | 0 | 0 |
| Ni Shuyi | financial head | Current | Female | 45 | June 16,2008 | August 30,2023 | 0 | 0 | 0 | 0 | 0 |
| Wang Weiyi | Deputy chairman | Current | Male | 51 | June 16,2008 | August 30,2023 | 1,028,700 | 0 | 257,175 | 0 | 771,525 |
| Wang Min | Deputy chairman | Current | Male | 50 | June 16,2008 | August 30,2023 | 1,013,600 | 0 | 253,400 | 0 | 760,200 |
| Li Feng | Deputy chairman | Current | Male | 46 | June 16,2008 | August 30,2023 | 1,083,970 | 0 | 270,993 | 0 | 812,977 |
| Zhou Siyuan | Secretary of the Board, Deputy chairman | Current | Male | 36 | January 31, 2018 | August 30,2023 | 0 | 0 | 0 | 0 | 0 |
| Zhang Ou | Deputy chairman | Current | Male | 54 | April 29, 2019 | August 30,2023 | 0 | 0 | 0 | 0 | 0 |
| Huang Aihua | Independent director | Resigned | Male | 65 | July 3, 2014 | August 31,2020 | 0 | 0 | 0 | 0 | 0 |
| Ye Xiaozhen | Independent director | Resigned | Female | 55 | July 3, 2014 | August 31,2020 | 0 | 0 | 0 | 0 | 0 |
| Zhu Yaer | Independent director | Resigned | Female | 56 | July 3, 2014 | August 31,2020 | 0 | 0 | 0 | 0 | 0 |
| Yu Wentian | Supervisor | Resigned | Male | 56 | June 16,2008 | August 31,2020 | 548,610 | 0 | 0 | 0 | 548,610 |
| Total | -- | -- | -- | -- | -- | -- | 83,442,050 | 0 | 1,107,058 | 82,334,992 |
II. Changes of Directors, Supervisors, and Senior Executives
√ Applicable □ Not applicable
| Name | Position | Type | Date | Reason |
| Shi Hong | Independent director | Be selected | August 31, 2020 | General meeting of shareholders elected |
| Chen Zhimin | Independent director | Be selected | August 31, 2020 | General meeting of shareholders elected |
| Wang Gang | Independent director | Be selected | August 31, 2020 | General meeting of shareholders elected |
| Fu Yajuan | Supervisor | Be selected | August 31, 2020 | General meeting of shareholders elected |
| Yu Wentian | Supervisor | Leave office after expiration of the term | August 31, 2020 | The term of office has expired |
| Huang Aihua | Independent director | Leave office after expiration of the term | August 31, 2020 | The term of office has expired |
| Ye Xiaozhen | Independent director | Leave office after expiration of the term | August 31, 2020 | The term of office has expired |
| Zhu Yaer | Independent director | Leave office after expiration of the term | August 31, 2020 | The term of office has expired |
Born in 1975, she has a college degree. From June 2008 to August 2020, she was a director and vice CEO of the Company. FromAugust 2020 to now, he has served as vice chairman and vice CEO of the Company. From January 2021 to now, he has served as vicechairman and CEO of the Company.Mr. Li Zheng, director of the Company, vice CEO. Chinese nationality, no permanent residence right outside China. Born in 1959,he has a college degree. From 2008 to now, he has served as vice chairman and vice CEO of the Company.
Ms. Wang Lingling, director of the Company, vice CEO. Chinese nationality, no permanent residence right outside China. Bornin 1961, bachelor degree. From 2008 to now, she has been a director and vice CEO of the Company.Ms. Xu Zheng, director of the Company. Chinese nationality, no permanent residence right outside China. Born in 1984, bachelordegree. From 2008 to now, she has been Secretary of the chairman of Great Star Holding Group Co., Ltd. From 2011 to now, she hasbeen a director of Hangcha Group Co., Ltd.
Mr. Cen Zhengping, director of the Company, Hong Kong, China, born in 1962, with a master's degree and professor level seniorengineer. From May 2019 to now, he has been a director of the Company.
Mr. Wang Gang, independent director of the Company. Chinese nationality, no permanent residence right outside China. Born inOctober 1975, he has a master's degree, certified public accountant and senior economist. From August 2017 to now, he has beendirector, vice CEO and Secretary of the Board of Directors of Hangzhou Robam Appliances Co., Ltd. From August 2020 to now, hehas been the independent director of the Company.
Ms. Shi Hong, independent director of the Company. Chinese nationality, no permanent residence right outside China. Born inJuly 1963, master degree, associate professor. From September 2005 to July 2018, she served as an associate professor of environmentalengineering teaching and Research Department of Shanghai Maritime University Marine Science and Engineering College and directorof environmental engineering laboratory. From August 2020 to now, she has been the independent director of the Company.
Ms. Chen Zhimin, independent director of the Company. Chinese nationality, no permanent residence right outside China. Bornin April 1960, she has a master's degree. She is currently a director of Zhejiang CAITONG Capital Investment Co., Ltd., the supervisorof Hangzhou Tigermed Consulting Co., Ltd., Zhejiang Canaan Technology Co., Ltd., Zhejiang Weixing Industrial Development Co.,Ltd., Hangzhou Honghua Digital Technology Co., Ltd., and independent director of Tongkun Group Co., Ltd. From August 2020 tonow, she has been the independent director of the Company.
2. Supervisors
Ms. Jiang Saiping, director of the Company's supervisor. Chinese nationality, no permanent residence right outside China. Born
in November 1971, bachelor degree. From 2009 to December 2013, she served as the manager of the Company's foreign salesdepartment, and has been the director of the Company's foreign sales since 2013.Ms. Fu Yajuan, company supervisor. Chinese nationality, no permanent residence right outside China. Born in September 1972,she has a college degree and senior accountant. From July 2008 to now, she has served as the deputy director of finance of the Company.
Mr. Chen Jun, company supervisor. Chinese nationality, no permanent residence right outside China. Born in August 1980, he hasa bachelor degree and intermediate engineer. From 2009 to now, he has served as the manager of industrial design department, DeputySecretary General of the Company Enterprise Science and Technology Association and Secretary of R & D and Innovation branch ofthe GreatStar of the Communist Party of China.
3. Senior Executives
Mr. Zhou Siyuan, Secretary of the Board of Directors and vice CEO of the Company. Chinese nationality, no permanent residenceright outside China. He was born in 1986, with a master degree. From January 2018 to now, he has been Secretary of the Board ofDirectors of the Company.
Ms. Ni Shuyi, Chief Financial Officer of the Company. Chinese nationality, no permanent residence right outside China. Born in1976, bachelor degree. From 2008 to now, she has been the Chief Financial Officer the Company.
Mr. Wang Weiyi, the Company's vice CEO. Chinese nationality, no permanent residence right outside China. Born in 1970,graduated from Zhejiang University in mechanical manufacturing and technology, with bachelor degree. From 2008 to now, he hasbeen the Company's vice CEO, responsible for product development and quality management of the Company, and is one of the mainleaders of the National Laboratory of the Company.
Mr. Wang Min, the Company's vice CEO. Chinese nationality, no permanent residence right outside China. Born in 1971, he hasa college degree. From 2008 to now, he has been the Company's vice CEO, responsible for the Company's product procurement business.
Mr. Li Feng, the Company's vice CEO. Chinese nationality, no permanent residence right outside China. Born in 1975, he has acollege degree. From 2008 to now, he has been the Company's vice CEO, responsible for the foreign sales of products.
Mr. Zhang Ou, the Company vice CEO, Chinese nationality, no permanent residence abroad, was born in 1967, senior economistand professor. From April 2019 to now, he has been the Company's vice CEO and is responsible for the operation of the laser industrysector of the Company.
Positions held in shareholder entities
√Applicable □ Not applicable
| Name | Name of the shareholder entity | Position in the shareholder entity | Start date | End date | Receives payment from the shareholder entity？ |
| Qiu Jianping | Great Star Holding Group Co., Ltd. | Chairman | August 10, 2009 | No | |
| Wang Lingling | Great Star Holding Group Co., Ltd. | Director | August 10, 2009 | No | |
| Li Zheng | Great Star Holding Group Co., Ltd. | Director | August 10, 2009 | No | |
| Chi Xiaoheng | Great Star Holding Group Co., Ltd. | Director | August 10, 2009 | No | |
| Xu Zheng | Great Star Holding Group Co., Ltd. | Manager | January 1, 2016 | Yes | |
| Fu Yajuan | Great Star Holding Group Co., Ltd. | Supervisor | January 20, 2020 | No |
| Name of the staff member | Name of other company | Position held in other company | Start date of term | Term end date | Whether to receive remuneration or allowance in other company |
| Qiu Jianping | Zhejiang Hangcha Holding Co., Ltd | Chairman | February 2, 2011 | No | |
| Qiu Jianping | Hangcha Group Co., Ltd., | Director | February 2, 2011 | No | |
| Qiu Jianping | Zhejiang Zhongtai Juxing Property Co.,Ltd. | Director | March 11, 2011 | No | |
| Qiu Jianping | Hangzhou Juxing Liansheng Trade Co., Ltd | Executive director | March 19, 2011 | No | |
| Qiu Jianping | Hangzhou GreatStar Machinery Co.,Ltd. | Chairman | September 20, 2011 | No | |
| Qiu Jianping | SMART SILVER LIMITED | Director | January 20, 2011 | No | |
| Qiu Jianping | HONG KONG GOLDEN DEER COMPANY LIMITED | Director | January 20, 2011 | No | |
| Qiu | BRIGHT WINNER LIMITED | Director | January 20, 2011 | No |
| Jianping | |||||
| Qiu Jianping | BILLION GLORY LIMITED | Director | January 20, 2011 | No | |
| Qiu Jianping | Ruian Junye Co., Ltd | Director | January 20, 2011 | No | |
| Qiu Jianping | GREAT STAR INDUSTRY COMPANY LIMITED | Executive director | June 20, 2013 | No | |
| Qiu Jianping | Jindao Investment Limited | Director | January 20, 2011 | No | |
| Qiu Jianping | Hangzhou West Lake Land Real Estate Co.,Ltd. | Director | January 20, 2011 | No | |
| Qiu Jianping | Xinjiang United Investment Co., Ltd | Executive partner | January 10, 2012 | No | |
| Qiu Jianping | Taifeng Company Limited | Director | January 20, 2011 | No | |
| Qiu Jianping | Zhejiang Zheshang Wuzhou Investment Management Co., Ltd | Director | February 7, 2012 | No | |
| Qiu Jianping | Hangzhou Kunxia investment management partnership (limited partnership) | Executive partner | January 18, 2018 | No | |
| Qiu Jianping | Zhejiang equity Service Group Co., Ltd | Director | 08 November 2017 | No | |
| Qiu Jianping | Zhejiang Guozi RoboticsCo., Ltd. | Director | September 26, 2014 | No | |
| Qiu Jianping | Zhejiang private enterprise joint investment Co., Ltd | Director | April 13, 2015 | No | |
| Qiu Jianping | Zhejiang asteroid Investment Management Co., Ltd | Director | June 23, 2016 | No | |
| Qiu Jianping | Hangzhou Lujing cultural creativity Co., Ltd | Executive director | November 26, 2015 | No | |
| Qiu Jianping | Hangzhou Xin'anjiang Hot Spring Resort Development Co., Ltd | Director | November 28, 2011 | No | |
| Qiu Jianping | Zhejiang Youbang small loan Co., Ltd | Director | December 25, 2009 | No | |
| Qiu Jianping | Hangzhou Haichao Enterprise Management Partnership (limited Partnership) | Executive partner | April 17, 2019 | No | |
| Qiu Jianping | Hangzhou Zhongce Haichao Enterprise Management Co., Ltd. | Chairman | April 17, 2019 | No | |
| Qiu | Zhejiang xinchai Co., Ltd | Director | December 26, 2019 | No |
| Jianping | |||||
| Qiu Jianping | Zhongce Rubber Group Co., Ltd | Director | October 21, 2019 | No | |
| Qiu Jianping | Zhejiang Zhongtai Juxing Real Estate Co., Ltd | Director | May 10, 2005 | No | |
| Qiu Jianping | Hangzhou Xinying investment management partnership (limited partnership) | Executive partner | May 31, 2019 | No | |
| Wang Lingling | HangZhou GreatStar Machinery Co.,LTD | Director | September 20, 2011 | No | |
| Wang Lingling | Hangzhou Fuyang Chongsheng Trade Co., Ltd | Executive director, General manager | November 11, 2013 | No | |
| Wang Lingling | Zhejiang Zhongtai Juxing Real Estate Co., Ltd | Supervisor | March 11, 2011 | No | |
| Wang Lingling | Hangcha Group Co., Ltd., | Director | January 27, 2012 | No | |
| Li Zheng | HangZhou GreatStar Machinery Co.,LTD | Director | September 20, 2011 | No | |
| Chi Xiaoheng | Hangzhou Kunxia juanyuan enterprise management partnership (limited partnership) | Executive partner | July 10, 2019 | No | |
| Chi Xiaoheng | Zhongyihe Technology Co., Ltd | Director | January 10, 2018 | No | |
| Xu Zheng | Hangzhou Zhongce Haichao Enterprise Management Co., Ltd. | Supervisor | April 21, 2019 | No | |
| Xu Zheng | Hangzhou Weiming Investment Management Co., Ltd | Chairman, General manager | September 1st, 2017 | No | |
| Xu Zheng | Hangzhou Xinglu Trading Co., Ltd | Chairman | 02 December 2011 | No | |
| Xu Zheng | Hangcha Group Co., Ltd., | Director | March 25, 2011 | No | |
| Xu Zheng | Zhejiang Guozi RoboticsCo., Ltd. | Director | September 21, 2017 | No | |
| Xu Zheng | Hangcha Group Co., Ltd., | Supervisor | January 27, 2012 | No | |
| Xu Zheng | Zhongyihe Technology Co., Ltd | Chairman, General manager | January 10, 2018 | No | |
| Xu Zheng | Zhongce Rubber Group Co., Ltd | Chairman of the Supervisory Committee | October 21, 2019 | No | |
| Cen Zhengping | HANJIA DESIGN GROUP CO.,LTD | Chairman | March 18, 2007 | No | |
| Cen Zhengping | Zhejiang Urban Construction Group Co., Ltd | Chairman | February 15, 2006 | No |
| Cen Zhengping | Shanghai Hanjia Investment Co., Ltd | Chairman, General manager | September 12, 2007 | No | |
| Cen Zhengping | Zhejiang Urban Construction Real Estate Group Co., Ltd | Chairman | September 21, 2010 | Yes | |
| Cen Zhengping | Zhejiang Hanjia Investment Co., Ltd | Executive director、General manager | October 20, 2010 | No | |
| Cen Zhengping | Zhejiang Dishang Investment Co., Ltd | Chairman | April 4, 2006 | No | |
| Cen Zhengping | Zhejiang Zhonglian Real Estate Development Co., Ltd | Director | July 25, 2005 | No | |
| Cen Zhengping | Hangzhou Hanjia Xinde investment management partnership | Executive Partner | August 28, 2014 | No | |
| Cen Zhengping | Zhejiang Jiahao Auction Co., Ltd | Director | February 19, 2014 | No | |
| Cen Zhengping | Zhejiang Guanyin Art Museum | Director general, Curator | September 4, 2012 | No | |
| Cen Zhengping | Hangzhou Zheda zinc power Co., Ltd | Director | June 21, 2017 | No | |
| Cen Zhengping | Zhejiang Kaiyin Holding Co., Ltd | Director | April 9, 2018 | No | |
| Wang Gang | Hangzhou Robam Appliances Co., Ltd. | Vice CEO、Secretary of the Board、Investment director、Director | June 1st, 2008 | Yes | |
| Wang Gang | Hangzhou Nuobang non woven Co., Ltd | Director | January 1, 2013 | No | |
| Wang Gang | De Dietrich Household Appliances Trading (Shanghai) Ltd.,Co | Director | July 1, 2012 | No | |
| Wang Gang | Hangzhou Fortune cryogenic equipment Co., Ltd | Director | January 1, 2018 | No | |
| Wang Gang | Detris Trading (Shanghai) Co., Ltd | Director | June 1st, 2016 | No | |
| Wang Gang | Hangzhou Guoguang Travel Products Co., Ltd | Director | October 1, 2017 | No | |
| Wang Gang | Shanghai MXCHIP Information Technology Co., Ltd. | Supervisor | November 1, 2017 | No | |
| Wang Gang | Ningbo Qingfeng Investment Co., Ltd | Director | December 1, 2017 | No |
| Wang Gang | Hangzhou boss fuchuang Investment Management Co., Ltd | Supervisor | May 1st, 2018 | No | |
| Wang Gang | Shengzhou Jindi Intelligent Kitchen Electricity Co., Ltd. | Director | July 1st, 2018 | No | |
| Wang Gang | Hangzhou Bensong New Materials Technology CO.,LTD. | Independent director | August 1, 2020 | Yes | |
| Wang Gang | Hangzhou Xpower Technology Co., Ltd. | Independent director | September 1, 2020 | Yes | |
| Wang Gang | Hangzhou Wheeler General Machinery Co., Ltd. | Director | October 1, 2020 | No | |
| Wang Gang | Hangzhou Zhu Bingren Culture and Art Co., Ltd. | Director | October 1, 2020 | No | |
| Wang Gang | Tongling Kingkong Electronics Technology Co.,Ltd. | Independent director | December 15, 2020 | Yes | |
| Chen Zhimin | Zhejiang Caitong Capital Investment Co., Ltd. | Director | No | ||
| Chen Zhimin | Hangzhou Tigermed Consulting Co., Ltd. | Supervisor | April 22, 2020 | Yes | |
| Chen Zhimin | Zhejiang Canaan Technology Limited. | Independent director | April 22, 2016 | Yes | |
| Chen Zhimin | Zhejiang Weixing Industrial Development Co.,Ltd. | Independent director | June 8, 2016 | Yes | |
| Chen Zhimin | Hangzhou Honghua Digital Technology Co., Ltd. | Independent director | 06 December 2019 | Yes | |
| Chen Zhimin | Tongkun Group Co., Ltd. | Independent director | June 23, 2020 | Yes | |
| Zhou Siyuan | Hangzhou Meiqi Technology Co., Ltd. | Supervisor | April 13, 2018 | No | |
| Zhou Siyuan | Zhejiang Guozi RoboticsCo., Ltd. | Director | September 14, 2017 | No | |
| Zhou Siyuan | Hangzhou Weiming Investment Management Co., Ltd | Director | September 1st, 2017 | No | |
| Zhou Siyuan | Hangzhou West Lake Land Real Estate Co.,Ltd. | Director | May 13, 2011 | No | |
| Zhou Siyuan | Hangzhou West Lake Land Management Co., Ltd. | Director | July 23, 2014 | No | |
| Zhou Siyuan | Hangcha Group Co., Ltd., | Director | January 28, 2011 | No |
| Zhou Siyuan | NINGBO DONGHAI BANK CO.， LTD. | Director | No | ||
| Zhou Siyuan | Zhongce Rubber Group Co., Ltd | Director | October 21, 2019 | No |
| Name | Position | Gender | Age | Tenure status | Total pretax remuneration received from the Company | Whether to get remuneration from related parties of the Company |
| Qiu Jianping | Chairman | Male | 59 | Current | 92.87 | No |
| Chi Xiaoheng | Vice Chairman、CEO | Female | 46 | Current | 78 | No |
| Li Zheng | Director、Vice CEO | Male | 62 | Current | 78 | No |
| Wang Lingling | Director、Vice CEO | Female | 60 | Current | 40.67 | No |
| Cen Zhengping | Director | Male | 59 | Current | 0 | No |
| Xu Zheng | Director | Female | 37 | Current | 0 | Yes |
| Ye Xiaozhen | Independent director | Female | 55 | Resigned | 5.33 | No |
| Huang Aihua | Independent director | Male | 65 | Resigned | 5.33 | No |
| Zhu Yaer | Independent director | Female | 56 | Resigned | 5.33 | No |
| Shi Hong | Independent director | Female | 46 | Current | 2.67 | No |
| Chen Zhimin | Independent director | Female | 58 | Current | 2.67 | No |
| Wang Gang | Independent director | Male | 59 | Current | 2.67 | No |
| Jiang Saiping | Chairman of the Supervisory Committee | Female | 50 | Current | 57 | No |
| Fu Yajuan | Supervisor | Female | 49 | Current | 34.2 | No |
| Chen Jun | Supervisor | Male | 41 | Current | 36.8 | No |
| Zhou Siyuan | Secretary of the Board、Vice CEO | Male | 36 | Current | 64.8 | No |
| Ni Shuyi | CFO | Female | 45 | Current | 44.4 | No |
| Wang Weiyi | Vice CEO | Male | 51 | Current | 65 | No |
| Wang Min | Vice CEO | Male | 50 | Current | 64 | No |
| Li Feng | Vice CEO | Male | 46 | Current | 77 | No |
| Zhang Ou | Vice CEO | Male | 54 | Current | 98.2 | No |
| Yu Wentian | Supervisor | Male | 56 | Resigned | 61.3 | No |
| Total | -- | -- | -- | -- | 916.24 | -- |
V. Employees of the Company
1. Number of employees, role type, and educational background
| Number employees of the parent company (person) | 1,155 |
| Number employees of major subsidiaries (person) | 6,221 |
| Total number of employees (person) | 7,376 |
| Total number of employees receiving a salary during the reporting period(person) | 7,376 |
| Number (person) of retired employees for whom the parent company and main subsidiaries need to bear expenses | 14 |
| Role type | |
| Category | Number (person) |
| Production personnel | 4,584 |
| Sales personnel | 934 |
| Technical personnel | 701 |
| Financial personnel | 146 |
| Administrative personnel | 1,011 |
| Total | 7,376 |
| Educational background | |
| Category | Number (person) |
| Doctorate | 9 |
| Master’ degree | 64 |
| Bachelor’ degree | 1,375 |
| Associate’ degree | 795 |
| High school and | 2,509 |
| Other | 2,624 |
| Total | 7,376 |
There are two kinds of wage calculation schemes: the first-line employees are paid by overtime, and the hourly wage and overtimewage are calculated according to the national labor law; Management positions are calculated by the combination of fixed salary andperformance salary.
3. Training plan
The training and development of employees is an important part of the Company. In 2020, the training management will continueto focus on three directions: new employee growth education, professional and technical training, and employee professionalismeducation. Affected by the pandemic situation, the Company organized 227 training sessions in the whole year, with a total of 5,097people participating in the training, with a total of 14,397 hours; At the same time, continue to carry out the construction of talentechelon, and complete the selection of reserve talents at director level and manager level. In 2021, in order to support the long-termsustainable development of the Company, the Company will focus on the selection and training of reserved talents, strengthen theconstruction of internal trainer team, build a strong teaching team, and meet the growing training needs.
4. Labor outsourcing
□ Applicable √ Not applicable
Section 10 Corporate GovernanceI. Corporate Governance Details
During the reporting period, the Company continuously improved the corporate governance structure, established and improvedthe internal management and control system of the Company, improved the corporate governance level and standardized theoperation of the Company in strict accordance with the requirements of relevant laws and regulations such as the Company law, thesecurities law, the governance standards of listed companies and the Listing Rules of Shenzhen Stock Exchange. As of the end of thisreport period, the actual situation of corporate governance basically meets the requirements of the relevant listed companygovernance documents issued by China Securities Regulatory Commission.
1. Shareholders and the Shareholders’ General Meeting
In strict accordance with the requirements of the standard opinions of the general meeting of shareholders of listed companies,the articles of association and the rules of procedure of the general meeting of shareholders, the Company standardizes theconvening, holding and voting procedures of the general meeting of shareholders, treats all shareholders equally, ensures that allshareholders have the right to know and participate in major matters of the Company, and ensures that all shareholders can fullyexercise their rights.
2. Directors and the Board of Directors
The Company elects directors in strict accordance with the Company law and the articles of association. At present, theCompany has nine directors, including three independent directors, accounting for one-third of all directors. The number andpersonnel composition of the Board of Directors of the Company meet the requirements of laws and regulations. The board ofDirectors consists of a Strategy and Development Committee, a Salary and Assessment Committee, a Nomination Committee, and aManagement Committee. The audit committee has four special committees. The Board of Directors carries out its work in strictaccordance with the articles of association, the rules of procedure of the Board of Directors, the working system of independentdirector, the working rules of the Secretary of the Board of Directors, and the guidelines for the standardized operation of listedcompanies of Shenzhen Stock Exchange, and exercises its functions and powers in accordance with the law. All directors of theCompany attend the Board of Directors and the general meeting of shareholders on time and are honest and trustworthy perform thedirector's duties diligently.
3. Supervisors and Supervisory Committees
The Company's supervisor will be elected in strict accordance with the Company law, the articles of association and the rules ofprocedure of the Supervisory Committees. The Company's supervisor will be composed of three supervisors, one of whom is theemployee supervisor. The number and personnel composition of the Company's Supervisory Committees meet the requirements oflaws and regulations. The Company's supervisors conscientiously perform their duties. In the spirit of being responsible to allshareholders, they hold supervisors' meetings, attend shareholders' meetings and attend the Board of Directors in accordance with therules of procedure of supervisors and other rules and regulations, and effectively supervise and express independent opinions on theCompany's major issues, related party transactions, financial situation, performance of directors and president.
4. Controlling shareholders and the Company
The Company and the controlling shareholder are independent in personnel, assets, finance, organization and business, and theBoard of Directors, Supervisory Committees and internal organization can operate independently. The behavior of the controllingshareholders of the Company is standardized. They exercise the rights of shareholders and undertake the corresponding obligationsthrough the general meeting of shareholders. They do not directly or indirectly interfere in the decision-making and businessactivities of the Company beyond the general meeting of shareholders, and damage the legitimate rights and interests of the Companyor other shareholders.
5. Performance appraisals and incentives
The Company has established a more comprehensive performance appraisal method, and the appointment of senior executives isopen and transparent, and in line with the relevant laws, regulations and the Company's internal rules and regulations. The Companyhas established a work performance evaluation system to link the income of employees with work performance. In the future, theCompany will explore more forms of incentive methods, form a multi-level comprehensive incentive mechanism, improve theperformance evaluation standards, better mobilize the work enthusiasm of management personnel, and attract and stabilize excellentmanagement talents and technical and business backbones.
6. Interested parties
The Company fully respects and protects the legitimate rights and interests of stakeholders, achieves the balance of interests ofshareholders, employees, society and other parties, attaches importance to social responsibility, and works with stakeholders to
promote the sustainable and healthy development of the Company.
7. Information disclosure and transparency
In strict accordance with the provisions of relevant laws and regulations and the Company's information disclosure managementsystem, the Company has strengthened the management of information disclosure affairs, fulfilled the obligation of informationdisclosure, and designated China Securities Journal, Securities Times, Securities Daily and CNKI as the newspapers and websites ofthe Company's information disclosure to truly, accurately, timely and completely disclose information, Ensure that all investors havefair access to company information. The Company will continue to improve and perfect the internal rules and regulations ofcorporate governance, strengthen the standardized operation and promote the sustainable and stable development of the Company inaccordance with the requirements of the standards for corporate governance of listed companies and the Listing Rules of ShenzhenStock Exchange.Are there any differences between the Company’s actual governance status and the Company Law and relevant rules ofCSRC？
□ Yes √ No
There is no material difference between the Company’s governance status and the Company Law and relevant rules of CSRC.
II. Details of the Company’s Separation from the Controlling Shareholder with Respect toBusiness, Personnel, Assets, Organization, and Financial Affairs
During the reporting period, the Company and the controlling shareholder have been completely separated in business, assets,personnel, organization, finance and other aspects. The Company has stable production and operation, perfect internal organization andindependent and standardized operation
（1） Business Independence of the Company
The Company has an independent production, procurement and sales system, which is completely independent of the controllingshareholder in business. There is no horizontal competition between the controlling shareholder and its affiliated enterprises and theCompany.
（2） Personnel independence of the Company
The personnel, personnel and salary of the Company are completely independent. The CEO, vice CEO, Secretary of the Board ofDirectors, Chief Financial Officer and other senior executives of the Company all work in the Company and receive remuneration.They do not hold any position or receive remuneration in the controlling shareholders and their subordinate enterprises except directorsand supervisors.
（3） The Company's Asset Integrity
The property right relationship between the Company and the controlling shareholders is clear, and the Company's funds, assetsand other resources are not illegally occupied or controlled by them. The Company's assets are complete, with production equipment,auxiliary production equipment, patents and other assets suitable for the production and business scope. The Company has completecontrol and control over all assets.
(4) Institutional independence
The Board of Directors, Supervisory Committees, the management and other internal organizations of the Company operateindependently. All functional departments are completely separated from the controlling shareholders in terms of rights, responsibilitiesand personnel. There is no superior subordinate relationship between the controlling shareholders and their functional departments andthe Company and its functional departments. There is no phenomenon that the controlling shareholders affect the independence of theCompany's production, operation and management.
(5) Financial independence
The Company has set up an independent financial department, established a sound financial and accounting management system,independent accounting, and there is no case of controlling shareholders interfering in the Company's financial and accounting activities.The Company opens an account independently in a commercial bank and does not share a bank account with the controlling shareholder.The Company shall make tax declaration and fulfill tax obligations independently according to law.III. Horizontal Competition
□ Applicable √ Not applicable
IV. Details about the Annual Shareholders’ General Meeting and Extraordinary Shareholders’General Meetings Held during the Reporting Period
1. Details about the shareholders’ general meeting during the reporting period
| Session | Meeting type | Investor participation ratio | Date of meeting | Date of disclosure | Disclosure index |
| 2019 Annual General Meeting | Annual General Meeting | 54.56% | May 14, 2020 | May 15, 2020 | China Securities Journal, Securities Daily, Securities Times, www.cninfo.com.cn , 2020-039: announcement of resolutions of the annual general meeting of shareholders in 2019 |
| First | Extraord | 54.44% | April 7, 2020 | April 8, 2020 | China Securities Journal, Securities Daily, |
| Extraordinary General Meeting of Shareholders of 2020 | inary General Meeting | Securities Times, www.cninfo.com.cn , 2020-014: Announcement on the resolution of the first extraordinary general meeting of shareholders in 2020 | |||
| Second Extraordinary General Meeting of Shareholders of 2020 | Extraordinary General Meeting | 55.26% | August 31, 2020 | September 1, 2020 | China Securities Journal, Securities Daily, Securities Times, www.cninfo.com.cn , 2020-075: Announcement on the resolution of the second extraordinary general meeting of shareholders in 2020 |
| Details of independent director attendance at board sessions and shareholders’ general meetings | |||||||
| Independent director | Sessions required to attend during the reporting period (times) | Attendance in person (times) | Attendance by way of telecommunication (times) | Entrusted presence (times) | Absence (times) | Nonattendance In person for two consecutive times | Attendance in shareholders’ meeting |
| Shi Hong | 3 | 3 | 0 | 0 | 0 | No | 0 |
| Chen Zhimin | 3 | 3 | 0 | 0 | 0 | No | 0 |
| Wang Gang | 3 | 3 | 0 | 0 | 0 | No | 0 |
| Zhu Yaer | 9 | 7 | 2 | 0 | 0 | No | 3 |
| Huang Aihua | 9 | 7 | 2 | 0 | 0 | No | 3 |
| Ye Xiaozhen | 9 | 7 | 2 | 0 | 0 | No | 3 |
Was advice to the Company from independent directors adopted？
√ Yes □ No
Explanation of advice of independent directors for the Company being adoptedDuring the reporting period, the independent director of the Company, in accordance with the articles of association, independentdirector working system and other laws and regulations, performed his duties in good faith, diligently and conscientiously, activelyparticipated in the Board of Directors and the general meeting of shareholders of the Company, seriously deliberated various motions,and objectively expressed his own views and opinions. At the same time, he took the initiative to communicate with other directors,supervisors, senior executives, internal audit department personnel and external auditors of the Company, paid attention to theCompany's operation and management, financial capital status and other matters, provided professional opinions on the Company'sinternal control, business decision-making, development strategy and other aspects, and expressed independent opinions on theCompany's foreign investment and other major matters, We seriously participated in the Company's decision-making, relied on ourown professional knowledge and ability to make objective, fair and independent judgments, gave full play to the role of independentdirector, and safeguarded the legitimate rights and interests of the Company and all shareholders, especially small and mediumshareholders.VI. Performance of Special Committee Affiliated to the Board during the Reporting Period
1. Performance of audit committee
During the reporting period, the audit committee of the Board of Directors, in accordance with the provisions of laws, regulations,articles of association and detailed rules for the implementation of the audit committee of the Company, guided the audit departmentof the Company to review the Company's internal control system and implementation, important accounting policies, financial statusand operation, and the use and management of raised funds, supervise and urge the financial department to improve the financialmanagement system. In this year, a total of five meetings were held to review the Company's regular financial statements and othermatters, to understand the Company's financial situation and operation in detail, to strictly review the construction and implementationof the Company's internal control system, and to effectively guide and supervise the Company's financial situation and operation. Inthe process of audit work in 2020, the audit committee will negotiate with the audit institution to determine the time arrangement andkey audit scope of the annual financial report audit work before the audit institution enters the site; Supervise the progress of the auditwork of the accounting firm, maintain the communication with the annual audit certified public accountants, timely exchange opinionson the problems found in the audit process, and ensure that the audit work is completed on time and with high quality. At the sametime, the audit report issued by the audit institution is reviewed, and the audit work of the audit institution in 2020 is evaluated andsummarized.
2. Performance of remuneration and appraisal committee
During the reporting period, the remuneration and appraisal committee of the Board of Directors reviewed the remuneration ofthe Company's directors and senior executives in 2020 in accordance with laws, regulations, the articles of association and the detailedrules for the implementation of the remuneration and assessment committee.
3. Performance of strategy committee
During the reporting period, the strategy committee of the Board of Directors organized and carried out work in accordance withlaws, regulations, the articles of association and the implementation rules of the Strategy and Development Committee of the Company,deliberated on the overall future development plan and strategic deployment of the Company, studied and put forward professionalopinions on major issues such as major asset restructuring and convertible corporate bond issuance of the Company, to makesuggestions for the implementation of major issues and subsequent planning.
4. Performance of Nomination Committee
During the reporting period, the Nomination Committee of the Board of Directors organized and carried out work in accordancewith laws, regulations, the articles of association and the implementation rules of the Nomination Committee of the Company, reviewedthe proposed directors and senior executives of the Company, put forward suggestions, and submitted relevant proposals to the Boardof Directors for deliberation.VII. Details on the Work of the Supervisory Committee
Were there risks in the Company according to the supervision of Supervisory Committees during the reporting period？
□ Yes √ No
Supervisory committees raised no objection to matters under supervision during the reporting period.
VIII. Assessment and Incentive Mechanisms for Senior Executives
The evaluation, incentive and restraint mechanism of the Company's senior executives is effective through the implementationrules of the Company's remuneration and appraisal committee, that is, through the establishment of the evaluation, incentive mechanismand compensation system, the Company's business objectives and development strategies are organically combined with the personaldevelopment objectives, and the Company's long-term interests are consistent with the personal economic interests, Fully mobilize thepotential of senior executives to create a good talent competition environment for the development of the Company. The Board ofDirectors of the Company assesses the work performance of the Company's senior executives by taking the year as the unit and theannual target completion index as the main basis. The Board of Directors is responsible for evaluating the responsibilities, abilities andperformance of the CEO. The CEO is responsible for the evaluation of other senior executives of the Company, and the evaluation is
conducted in the form of the combination of operation and management work and the completion of relevant tasks. During the reportingperiod, the senior executives of the Company were able to perform their duties in strict accordance with the Company law, articles ofassociation and other laws and regulations.IX. Internal Controls
1. Details on material weakness found in the Company’s internal control during reporting period
□ Yes √ No
2. Self-appraisal report on internal controls
| Disclosure date of the Management’s Report on Internal Control | April 15, 2021 | |
| Disclosure index of the Management’s Report on Internal Control | http://www.cninfo.com.cn Self evaluation report on internal control in 2020 | |
| Proportion of total assets included in evaluation scope | 100.00% | |
| Proportion of operating revenue included in evaluation scope | 100.00% | |
| Deficiency Standards | ||
| Category | Financial Report | Non-Financial Report |
| Qualitative criteria | (1) Signs of major defects in financial reports include: ① fraud by directors, supervisors and senior executives; ② To correct the material errors in the announced financial statements; ③ The CPA finds that there is a material misstatement in the current financial report, but the internal control of the Company fails to find the misstatement in the operation process; ④ The supervision of internal control by audit committee and internal audit organization is invalid (2) Signs of important defects in financial reports include: ① failure to select and apply accounting policies in accordance with generally accepted accounting standards; ② No antifraud procedures and control measures have been established; ③ For the accounting treatment of unconventional or | In case of the following circumstances, it can be identified as major defects, and in other circumstances, it can be identified as major defects or general defects according to the degree of influence (1) The decision-making procedure is not scientific (2) Violation of national laws and regulations, such as environmental pollution (3) Managers or technicians are losing one after another (4) The results of internal control evaluation, especially the major or important defects, have not been rectified (5) Important business lacks system control or system failure. |
| special transactions, there is no corresponding control mechanism or compensatory control (3) It refers to defects other than major defects and important defects, which are general defects. | ||
| Quantitative criteria | If the loss that may be caused or caused by the defect of internal control is related to the profit, it shall be measured by the operating revenue index. If the amount of financial report misstatement caused by the defect alone or together with other defects is less than 1% of the operating revenue, it is considered as a general defect; If it is more than 1% but less than 3% of the operating revenue, it is considered as an important defect; If it exceeds 3% of the operating revenue, it is considered as a major defect. The loss that may be caused or caused by the defect of internal control is related to asset management, which shall be measured by the total assets index. If the amount of financial report misstatement caused by the defect alone or together with other defects is less than 1% of the total assets, it is considered as a general defect; If it is more than 1% of the total assets but less than 3%, it is considered as an important defect; If it exceeds 3% of the total assets, it is considered as a major defect. | (1) Major defects: causing direct property loss of more than RMB 10 million (2) Major defects: causing direct property loss of RMB 1 million to 10 million (inclusive) (3) General defects: causing direct property loss of less than RMB 1 million (inclusive). |
| Number of material weaknesses in the financial report | 0 | |
| Number of material weaknesses of the non financial report | 0 | |
| Number of Significant deficiencies in the financial report | 0 | |
| Number of Significant deficiencies of the non financial report | 0 | |
| In our opinion, GreatStar has maintained effective internal control over financial reporting in all major aspects as of December 31, 2020 in accordance with the guidelines for the standardized operation of Listed Companies in Shenzhen Stock Exchange (revised in 2020). | |
| Particulars about Audit Report on Internal Controls | Disclosure |
| Disclosure date of the Audit Report on Internal Controls | April 15, 2021 |
| Disclosure index of the Audit Report on Internal Controls | http://www.cninfo.com.cn Disclosed "assurance report on internal control of Shanghai great Star Industrial Co., Ltd." (Pan-China verified [2021] No. 2690) |
| Type of Audit Opinion | Unqualified Opinion |
| Is there a material weakness in the nonfinancial report | No |
Section 11 Corporate BondsWere there bonds publicly issued and listed on an exchange, either at or not at maturity, and are not fully paid on the approval reportdate of the annual report？No
Section 12 Financial ReportI. Audit Report
| Type of audit opinion | Standard unqualified opinion |
| Date of signature | April14, 2021 |
| Auditor Institution | Pan-China Certified Public Accountants LLP |
| Number of audit reports | Pan-China【2021】2688 |
| Authors | Chen Zhongjiang, Hu hujian |
in forming our opinion thereon, and we do not express a separate opinion on these matters.(I)Revenue recognition
1. Description
Please refer to section V (II) 1 and III (XXVI) of the notes to the financial statements for details.The Company’s operating revenue mainly comes from sales of hand tools and power tools, laser measurement, storage, andpersonal protective equipment (PPE), etc. In 2020, the operating revenue amounted to RMB 8,544,440,154.30. As operating revenueis one of the key performance indicators of the Company, there might be inherent risks that the Company’s management (the“Management”) adopts inappropriate revenue recognition to achieve specific goals or expectations, we have identified revenuerecognition as a key audit matter.
2. Responsive audit procedures
Our main audit procedures for revenue recognition are as follows:
(1) We obtained understandings of key internal controls related to revenue recognition, assessed the design of these controls,determined whether they had been executed, and tested the effectiveness of the operation;
(2) We checked sale contracts, obtained understandings of main contractual terms or conditions, and assessed whether the revenuerecognition method was appropriate;
(3) We performed analysis procedure on operating revenue and gross margin by month, product, client, etc., so as to identifywhether there are significant or abnormal fluctuations and find out the reason of fluctuations;
(4) For revenue from domestic sales, we checked supporting documents related to revenue recognition by sampling method,including sales contracts, orders, sales invoices, delivery lists, delivery orders, shipping documents, client acceptance receipts, etc.; forrevenue from overseas sales, we checked supporting documents including sales contracts, bills of clearance, waybills, client acceptancereceipts, sales invoices, etc. by sampling method;
(5) We performed confirmation procedures on current sales amount by sampling method in combination with confirmationprocedures on accounts receivable;
(6) We performed cut-off tests on the operating revenue recognized around the balance sheet date, and assessed whether theoperating revenue was recognized in the appropriate period; and
(7) We checked whether information related to operating revenue had been presented appropriately in the financial statements.
(II)Impairment of goodwill
1. Description
Please refer to section III (XXI) and V (I) 19 of the notes to the financial statements for details.
As of December 31, 2020, the book balance of goodwill amounted to 1,955,407,883.83RMB, with provision for impairment of129,879,900.27RMB, and the carrying amount amounted to 1,825,527,983.56RMB.
For asset group or asset group portfolio related to goodwill, if there is objective evidence indicating impairment loss, theManagement will perform impairment test on goodwill together with related asset group or asset group portfolio at the end of eachperiod, and the recoverable amount of related asset group or asset group portfolio is determined based on the estimated present valueof future cash flows. Key assumptions adopted in the impairment test include: revenue growth rate in detailed forecast period, growthrate in perpetual forecast period, gross margin, discount rate, etc.
As the amount of goodwill is significant and impairment test involves significant judgment of the Management, we have identifiedimpairment of goodwill as a key audit matter.
2. Responsive audit procedures
Our main audit procedures for impairment of goodwill are as follows:
(1)We obtained understandings of key internal controls related to impairment of goodwill, assessed the design of these controls,determined whether they had been executed, and tested the effectiveness of their operation;
(2) We reviewed the present value of future cash flows estimated by the Management in previous years and the actual operatingresults, and assessed the accuracy of the Management’s historical estimations;
(3) We obtained understandings of and assessed the competency, professional quality and objectivity of external appraisersengaged by the Management;
(4) We assessed the reasonableness and consistency of impairment test method adopted by the Management;
(5) We assessed the reasonableness of key assumptions used in impairment test and reviewed whether the relevant assumptionswere consistent with overall economic environment, industry condition, management situation, historical experience, and otherassumptions related to the financial statements used by the Management;
(6) We tested the accuracy, completeness and relativity of data used in the impairment test and reviewed the internal consistencyof related information in the impairment test;
(7) We tested whether the calculation of estimated present value of future cash flows was accurate; and
(8) We checked whether information related to impairment of goodwill had been presented appropriately in the financialstatements.
IV. Other Information
The Management is responsible for the other information. The other information comprises the information included in theCompany’s annual report, but does not include 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 in the auditor otherwise appears to be materially misstated.If, based on the work we have performed, we conclude that there is a material misstatement of the other information, we arerequired to report that fact. We have nothing to report in this regard.
V. Responsibilities of the Management and Those Charged with Governance for the Financial Statements
The Management is responsible for preparing and presenting fairly the financial statements in accordance with China AccountingStandards for Business Enterprises, as well as designing, implementing and maintaining internal control relevant to the preparation offinancial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the Management is responsible for assessing the Company’s ability to continue as a goingconcern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless theManagement either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Company’s financial reporting process.
VI. Certified Public Accountant’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 China Standards on Auditing will always detect amaterial misstatement when it exists. Misstatement can arise from fraud or error and are considered material if, individually or in theaggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financialstatements.
We exercise professional judgment and maintain professional skepticism throughout the audit performed in accordance with ChinaStandards on Auditing. We also:
(I) Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design andperform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis forour opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraudmay involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
(II) Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate inthe circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control.(III) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and relateddisclosures made by the Management.(IV) Conclude on the appropriateness of the Management’s use of the going concern basis of accounting and, based on the auditevidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on theCompany’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attentionin 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 conditionsmay cause the Company to cease to continue as a going concern.(V) Evaluate the overall presentation, structure and content of the financial statements, and whether the financial statementsrepresent the underlying transactions and events in a manner that achieves fair presentation.(VI) Obtain sufficient and appropriate audit evidence regarding the financial information of the entities or business activitieswithin the Company to express an opinion on the financial statements. We are responsible for the direction, supervision andperformance of the group audit. We remain sole responsibility for our audit opinion.We communicate with those charged with governance regarding the planned audit scope, time schedule and significant auditfindings, including any deficiencies in internal control of concern 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 to communicate with them all relationships and other matters that may reasonably be thought to bear onour independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significancein the 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.II. Financial StatementsThe notes to financial statements expressed in Renminbi RMB
1、Consolidated Balance Sheet
By: Hangzhou Great Star Industrial Co., Ltd.
Consolidated balance sheet as at December 31, 2020
Currency: RMB
| Items | December 31, 2020 | December 31, 2019 |
| Current assets: | ||
| Cash and bank balances | 3,750,506,068.39 | 2,456,926,805.33 |
| Settlement funds | ||
| Loans to other banks | ||
| Held-for-trading financial assets | 63,751,278.55 | 71,998,431.87 |
| Derivative financial assets | ||
| Notes receivable | 11,530,057.49 | 3,691,476.43 |
| Accounts receivable | 1,260,096,723.75 | 1,107,232,500.18 |
| Receivables financing | 378,066,065.73 | 103,629,298.04 |
| Prepaid expenses | 80,008,380.84 | 44,207,270.43 |
| Premiums receivable | ||
| Reinsurance accounts receivable | ||
| Reinsurance reserve receivable | ||
| Other receivables | 58,613,172.02 | 32,597,234.91 |
| Including: Interest receivable | ||
| Dividends receivable | ||
| Financial assets under reverse repo | ||
| Inventories | 1,386,320,837.86 | 1,193,884,981.91 |
| Contract assets | ||
| Assets classified as held for sale | ||
| Non-current assets due within one year | 90,583.31 | 2,279,390.88 |
| Other current assets | 146,623,787.19 | 127,977,910.59 |
| Total current assets | 7,135,606,955.13 | 5,144,425,300.57 |
| Non-current assets: | ||
| Loans and advances paid | ||
| Debt investments | ||
| Other debt investments | ||
| Long-term receivables | 2,866,819.08 | 19,123,250.45 |
| Long-term equity investments | 2,207,878,459.67 | 1,931,344,951.25 |
| Other equity instrument investments | 16,550,000.00 | 192,550,000.00 |
| Other non-current financial assets | 569,209.09 | |
| Investment property | ||
| Fixed assets | 1,348,034,595.31 | 1,058,454,179.69 |
| Construction in progress | 166,268,204.96 | 129,158,811.57 |
| Productive biological assets | ||
| Oil & gas assets | ||
| Right-of-use assets | 269,670,508.77 | 208,773,189.40 |
| Intangible assets | 607,716,594.78 | 507,806,230.99 |
| Development expenditures | ||
| Goodwill | 1,825,527,983.56 | 1,873,718,797.75 |
| Long-term prepayments | 16,407,174.63 | 6,024,753.26 |
| Deferred tax assets | 41,813,418.61 | 27,134,708.74 |
| Other non-current assets | 39,438,331.18 | 33,415,400.66 |
| Total non-current assets | 6,542,172,090.55 | 5,988,073,482.85 |
| Total assets | 13,677,779,045.68 | 11,132,498,783.42 |
| Current liabilities: | ||
| Short-term borrowings | 1,015,117,910.75 | 823,460,644.57 |
| Central bank loans | ||
| Loans from other banks | ||
| Held-for-trading financial liabilities | 4,901,459.62 | |
| Derivative financial liabilities | ||
| Notes payable | 24,913,000.00 | 309,180,000.00 |
| Accounts payable | 1,168,327,985.88 | 893,633,852.13 |
| Advances received | 56,674,240.40 | |
| Contract liabilities | 72,490,372.55 | |
| Financial liabilities under repo | ||
| Absorbing deposit and interbank deposit | ||
| Deposit for agency security transaction | ||
| Deposit for agency security |
| underwriting | ||
| Employee benefits payable | 195,907,997.48 | 151,171,243.00 |
| Taxes and rates payable | 185,995,732.67 | 82,866,611.51 |
| Other payables | 26,425,047.57 | 12,600,147.87 |
| Including: Interest receivable | ||
| Dividends receivable | ||
| Handling fee and commission payable | ||
| Reinsurance accounts payable | ||
| Liabilities classified as held for sale | ||
| Non-current liabilities due within one year | 221,714,183.90 | 181,542,647.04 |
| Other current liabilities | ||
| Total current liabilities | 2,910,892,230.80 | 2,516,030,846.14 |
| Non-current liabilities: | ||
| Insurance policy reserve | ||
| Long-term borrowings | 509,555,882.91 | 689,385,008.46 |
| Bonds payable | 799,729,005.89 | |
| Including: Preferred shares | ||
| Perpetual bonds | ||
| Lease liabilities | 246,303,999.08 | 198,134,622.40 |
| Long-term payables | 1,499,174.07 | 2,475,860.36 |
| Long-term employee benefits payable | 77,924,731.15 | 39,397,630.54 |
| Provisions | 3,550,413.29 | 5,704,617.60 |
| Deferred income | 3,992,738.59 | 5,189,661.19 |
| Deferred tax liabilities | 86,920,686.60 | 59,746,738.53 |
| Other non-current liabilities | ||
| Total non-current liabilities | 1,729,476,631.58 | 1,000,034,139.08 |
| Total liabilities | 4,640,368,862.38 | 3,516,064,985.22 |
| Equity: | ||
| Share capital | 1,075,247,700.00 | 1,075,247,700.00 |
| Other equity instruments | 190,509,257.28 | |
| Including: Preferred shares |
| Perpetual bonds | ||
| Capital reserve | 2,095,044,541.15 | 2,036,394,272.83 |
| Less: Treasury shares | 105,492,690.23 | 105,492,690.23 |
| Other comprehensive income | -105,837,346.87 | 145,005,399.56 |
| Special reserve | ||
| Surplus reserve | 521,602,764.46 | 429,856,864.70 |
| General risk reserve | ||
| Undistributed profit | 5,155,116,352.49 | 3,849,578,318.39 |
| Total equity attributable to the parent company | 8,826,190,578.28 | 7,430,589,865.25 |
| Non-controlling interest | 211,219,605.02 | 185,843,932.95 |
| Total equity | 9,037,410,183.30 | 7,616,433,798.20 |
| Total liabilities & equity | 13,677,779,045.68 | 11,132,498,783.42 |
| Items | December 31, 2020 | December 31, 2019 |
| Current assets: | ||
| Cash and bank balances | 2,287,675,650.67 | 1,472,525,772.95 |
| Held-for-trading financial assets | 13,386,400.00 | 7,033,099.93 |
| Derivative financial assets | ||
| Notes receivable | 8,314,207.49 | 3,691,476.43 |
| Accounts receivable | 1,275,860,264.50 | 948,196,301.97 |
| Receivables financing | 368,774,999.78 | 97,648,181.92 |
| Prepaid expenses | 39,010,545.50 | 15,153,995.43 |
| Other receivables | 883,363,518.44 | 666,322,858.19 |
| Including: Interest receivable | ||
| Dividends receivable | ||
| Inventories | 77,384,999.66 | 49,868,368.75 |
| Contract assets | ||
| Assets classified as held for sale | ||
| Non-current assets due within one year |
| Other current assets | 65,377,083.73 | 56,483,305.15 |
| Total current assets | 5,019,147,669.77 | 3,316,923,360.72 |
| Non-current assets: | ||
| Debt investments | ||
| Other debt investments | ||
| Long-term receivables | ||
| Long-term equity investments | 5,155,164,634.30 | 4,643,499,980.57 |
| Other equity instrument investments | 16,550,000.00 | 192,550,000.00 |
| Other non-current financial assets | ||
| Investment property | ||
| Fixed assets | 142,635,599.93 | 156,195,102.79 |
| Construction in progress | 5,723,398.50 | 1,949,216.31 |
| Productive biological assets | ||
| Oil & gas assets | ||
| Right-of-use assets | ||
| Intangible assets | 17,746,992.84 | 20,662,730.86 |
| Development expenditures | ||
| Goodwill | ||
| Long-term prepayments | ||
| Deferred tax assets | 15,288,010.17 | 11,825,974.87 |
| Other non-current assets | 1,957,642.06 | 6,189,776.24 |
| Total non-current assets | 5,355,066,277.80 | 5,032,872,781.64 |
| Total assets | 10,374,213,947.57 | 8,349,796,142.36 |
| Current liabilities: | ||
| Short-term borrowings | 960,645,447.14 | 811,442,302.07 |
| Held-for-trading financial liabilities | 4,901,459.62 | |
| Derivative financial liabilities | ||
| Notes payable | 300,000,000.00 | |
| Accounts payable | 738,095,592.36 | 511,205,844.52 |
| Advances received | 34,610,450.57 | |
| Contract liabilities | 39,453,211.46 | |
| Employee benefits payable | 45,611,342.23 | 37,398,109.40 |
| Taxes and rates payable | 103,261,356.89 | 31,676,274.40 |
| Other payables | 23,933,506.71 | 19,266,579.31 |
| Including: Interest payable | ||
| Dividends payable | ||
| Liabilities classified as held for sale | ||
| Non-current liabilities due within one year | 73,585,483.86 | 73,585,483.85 |
| Other current liabilities | ||
| Total current liabilities | 1,984,585,940.65 | 1,824,086,503.74 |
| Non-current liabilities: | ||
| Long-term borrowings | 220,836,522.82 | 294,422,006.68 |
| Bonds payable | 799,729,005.89 | |
| Including: Preferred shares | ||
| Perpetual bonds | ||
| Lease liabilities | ||
| Long-term payables | ||
| Long-term employee benefits payable | ||
| Provisions | ||
| Deferred income | 2,377,073.64 | 3,197,295.96 |
| Deferred tax liabilities | 6,363,085.38 | 12,627,681.09 |
| Other non-current liabilities | ||
| Total non-current liabilities | 1,029,305,687.73 | 310,246,983.73 |
| Total liabilities | 3,013,891,628.38 | 2,134,333,487.47 |
| Equity: | ||
| Share capital | 1,075,247,700.00 | 1,075,247,700.00 |
| Other equity instruments | 190,509,257.28 | |
| Including: Preferred shares | ||
| Perpetual bonds | ||
| Capital reserve | 2,103,492,365.12 | 2,042,882,286.04 |
| Less: Treasury shares | 105,492,690.23 | 105,492,690.23 |
| Other comprehensive income | -27,385,736.04 | 43,484,350.56 |
| Special reserve | ||
| Surplus reserve | 517,854,467.55 | 426,108,567.79 |
| Undistributed profit | 3,606,096,955.51 | 2,733,232,440.73 |
| Total equity | 7,360,322,319.19 | 6,215,462,654.89 |
| Total liabilities & equity | 10,374,213,947.57 | 8,349,796,142.36 |
| Items | Year 2020 | Year 2019 |
| I. Total operating revenue | 8,544,440,154.30 | 6,625,464,121.34 |
| Including: Operating revenue | 8,544,440,154.30 | 6,625,464,121.34 |
| Interest income | ||
| Premium earned | ||
| Revenue from handling charges and commission | ||
| II. Total operating cost | 7,272,261,104.74 | 5,721,804,312.91 |
| Including: Operating cost | 5,926,765,895.76 | 4,466,409,082.38 |
| Interest expenses | ||
| Handling charges and commission expenditures | ||
| Surrender value | ||
| Net payment of insurance claims | ||
| Net provision of insurance policy reserve | ||
| Premium bonus expenditures | ||
| Reinsurance expenses | ||
| Taxes and surcharges | 27,268,787.92 | 26,006,715.95 |
| Selling expenses | 458,274,408.65 | 586,968,060.26 |
| Administrative expenses | 500,999,938.00 | 477,705,229.09 |
| R&D expenses | 245,372,069.36 | 203,772,736.84 |
| Financial expenses | 113,580,005.05 | -39,057,511.61 |
| Including: Interest expenses | 69,915,383.28 | 48,674,516.53 |
| Interest income | 58,134,194.43 | 50,223,558.70 |
| Add: Other income | 33,486,910.24 | 75,925,211.69 |
| Investment income (or less: losses) | 296,551,290.93 | 75,394,212.97 |
| Including: Investment income from associates and joint ventures | 260,530,217.44 | 65,458,417.14 |
| Gains from derecognition of financial assets at amortized cost | ||
| Gains on foreign exchange (or less: losses) | ||
| Gains on net exposure to hedging risk (or less: losses) | ||
| Gains on changes in fair value (or less: losses) | 31,920,861.95 | 8,154,053.98 |
| Credit impairment loss | -28,131,844.44 | -570,324.76 |
| Assets impairment loss | -93,484,567.00 | -16,109,144.02 |
| Gains on asset disposal (or less: losses) | -300,665.75 | -996,941.48 |
| III. Operating profit (or less: losses) | 1,512,221,035.49 | 1,045,456,876.81 |
| Add: Non-operating revenue | 54,877,063.15 | 2,897,883.92 |
| Less: Non-operating expenditures | 2,823,350.71 | 3,195,314.90 |
| IV. Profit before tax (or less: total loss) | 1,564,274,747.93 | 1,045,159,445.83 |
| Less: Income tax | 199,780,159.49 | 141,506,404.74 |
| V. Net profit (or less: net loss) | 1,364,494,588.44 | 903,653,041.09 |
| (I) Categorized by the continuity of operations | ||
| 1. Net profit from continuing operations (or less: net loss) | 1,364,494,588.44 | 903,653,041.09 |
| 2. Net profit from discontinued operations (or less: net loss) | ||
| (II) Categorized by the portion of equity ownership | ||
| 1. Net profit attributable to owners of parent company (or less: net loss) | 1,350,132,516.91 | 895,030,139.78 |
| 2. Net profit attributable to non-controlling shareholders (or less: net loss) | 14,362,071.53 | 8,622,901.31 |
| VI. Other comprehensive income after tax | -250,850,396.50 | 67,658,998.92 |
| Items attributable to the owners of the parent company | -250,842,746.43 | 67,030,052.25 |
| (I) Not to be reclassified subsequently to profit or loss | -81,601,512.40 | 30,192,806.10 |
| 1. Changes in remeasurement on the net defined benefit plan | -35,338,213.90 | -16,070,492.40 |
| 2. Items under equity method that will not be reclassified to profit or loss | ||
| 3. Changes in fair value of other equity instrument investments | 888,118.45 | 46,263,298.50 |
| 4. Changes in fair value of own credit risk | ||
| 5. Others | -47,151,416.95 | |
| (II) To be reclassified subsequently to profit or loss | -169,241,234.03 | 36,837,246.15 |
| 1. Items under equity method that may be reclassified to profit or loss | -24,606,788.10 | -5,997,625.46 |
| 2. Changes in fair value of other debt investments | ||
| 3. Profit or loss from reclassification of financial assets into other comprehensive income | ||
| 4. Provision for credit impairment of other debt investments | ||
| 5. Cash flow hedging reserve | ||
| 6. Translation reserve | -144,634,445.93 | 42,834,871.61 |
| 7. Others | ||
| Items attributable to non-controlling shareholders | -7,650.07 | 628,946.67 |
| VII. Total comprehensive income | 1,113,644,191.94 | 971,312,040.01 |
| Items attributable to the owners of the parent company | 1,099,289,770.48 | 962,060,192.03 |
| Items attributable to non-controlling shareholders | 14,354,421.46 | 9,251,847.98 |
| VIII. Earnings per share (EPS): | ||
| (I) Basic EPS (yuan per share) | 1.27 | 0.84 |
| (II) Diluted EPS (yuan per share) | 1.25 | 0.84 |
Head of accounting department:Ni Shuyi
4、Parent company income statement
Currency: RMB
| Item | Year 2020 | Year 2019 |
| I. Operating revenue | 5,365,589,947.72 | 4,000,541,624.61 |
| Less: Operating cost | 4,064,180,496.50 | 3,067,900,474.14 |
| Taxes and surcharges | 4,142,069.22 | 2,968,423.90 |
| Selling expenses | 138,139,974.93 | 217,185,618.82 |
| Administrative expenses | 121,245,790.31 | 129,054,642.42 |
| R&D expenses | 178,566,920.53 | 149,073,140.05 |
| Financial expenses | 172,866,787.25 | -39,124,303.20 |
| Including: Interest expenses | 58,234,894.08 | 24,995,444.05 |
| Interest income | 48,047,881.09 | 50,757,690.20 |
| Add: Other income | 11,142,990.59 | 52,471,190.50 |
| Investment income (or less: losses) | 356,483,772.96 | 69,013,520.02 |
| Including: Investment income from associates and joint ventures | 260,562,082.75 | 65,084,654.93 |
| Gains from derecognition of financial assets at amortized cost (or less: losses) | ||
| Gains on net exposure to hedging risk (or less: losses) | ||
| Gains on changes in fair value (or less: losses) | 11,254,759.69 | -893,359.69 |
| Credit impairment loss | -43,237,697.59 | -12,029,289.83 |
| Assets impairment loss | -73,695.67 | -3,194,329.81 |
| Gains on asset disposal (or less: losses) | 61,509.73 | |
| II. Operating profit (or less: losses) | 1,022,018,038.96 | 578,912,869.40 |
| Add: Non-operating revenue | 380,675.34 | 2,338,677.08 |
| Less: Non-operating expenditures | 1,334,925.87 | 963,643.04 |
| III. Profit before tax (or less: total loss) | 1,021,063,788.43 | 580,287,903.44 |
| Less: Income tax | 103,604,790.84 | 83,490,490.04 |
| IV. Net profit (or less: net loss) | 917,458,997.59 | 496,797,413.40 |
| (I) Net profit from continuing operations (or less: net loss) | 917,458,997.59 | 496,797,413.40 |
| (II) Net profit from discontinued operations (or less: net loss) | ||
| V. Other comprehensive income after tax | -70,870,086.60 | 40,265,673.04 |
| (I) Not to be reclassified subsequently to profit or loss | -46,263,298.50 | 46,263,298.50 |
| 1. Changes in remeasurement on the net defined benefit plan | ||
| 2. Items under equity method that will not be reclassified to profit or loss | ||
| 3. Changes in fair value of other equity instrument investments | 888,118.45 | 46,263,298.50 |
| 4. Changes in fair value of own credit risk | ||
| 5. Others | -47,151,416.95 | |
| (II) To be reclassified subsequently to profit or loss | -24,606,788.10 | -5,997,625.46 |
| 1. Items under equity method that may be reclassified to profit or loss | -24,606,788.10 | -5,997,625.46 |
| 2. Changes in fair value of other debt investments | ||
| 3. Profit or loss from reclassification of financial assets into other comprehensive income | ||
| 4. Provision for credit impairment of other debt investments | ||
| 5. Cash flow hedging reserve | ||
| 6. Translation reserve | ||
| 7. Others | ||
| VI. Total comprehensive income | 846,588,910.99 | 537,063,086.44 |
| VII. Earnings per share (EPS): |
| (I) Basic EPS (yuan per share) | ||
| (II) Diluted EPS (yuan per share) |
| Items | Year 2020 | Year 2019 |
| I. Cash flows from operating activities: | ||
| Cash receipts from sales of goods or rendering of services | 8,062,725,580.89 | 6,451,045,254.62 |
| Net increase of client deposit and interbank deposit | ||
| Net increase of central bank loans | ||
| Net increase of loans from other financial institutions | ||
| Cash receipts from original insurance contract premium | ||
| Net cash receipts from reinsurance | ||
| Net increase of policy-holder deposit and investment | ||
| Cash receipts from interest, handling charges and commission | ||
| Net increase of loans from others | ||
| Net increase of repurchase | ||
| Net cash receipts from agency security transaction | ||
| Receipts of tax refund | 561,244,609.68 | 482,993,490.06 |
| Other cash receipts related to operating activities | 109,278,105.56 | 143,155,879.01 |
| Subtotal of cash inflows from operating activities | 8,733,248,296.13 | 7,077,194,623.69 |
| Cash payments for goods purchased and services received | 5,804,488,157.96 | 4,091,633,152.86 |
| Net increase of loans and advances to clients | ||
| Net increase of central bank deposit and interbank deposit | ||
| Cash payments for insurance |
| indemnities of original insurance contracts | ||
| Net increase of loans to others | ||
| Cash payments for interest, handling charges and commission | ||
| Cash payments for policy bonus | ||
| Cash paid to employees or payments on behalf of employees | 1,260,836,147.62 | 1,249,322,423.05 |
| Cash payments for taxes and rates | 250,159,571.54 | 324,387,618.39 |
| Other cash payments related to operating activities | 646,613,793.77 | 601,964,305.79 |
| Subtotal of cash outflows from operating activities | 7,962,097,670.89 | 6,267,307,500.09 |
| Net cash flows from operating activities | 771,150,625.24 | 809,887,123.60 |
| II. Cash flows from investing activities: | ||
| Cash receipts from withdrawal of investments | 289,698,875.26 | 66,926,106.92 |
| Cash receipts from investment income | 55,754,289.66 | 11,703,886.26 |
| Net cash receipts from the disposal of fixed assets, intangible assets and other long-term assets | 3,231,084.97 | 2,146,746.87 |
| Net cash receipts from the disposal of subsidiaries & other business entities | ||
| Other cash receipts related to investing activities | 22,822,339.65 | 50,409,101.11 |
| Subtotal of cash inflows from investing activities | 371,506,589.54 | 131,185,841.16 |
| Cash payments for the acquisition of fixed assets, intangible assets and other long-term assets | 624,730,486.29 | 328,143,427.60 |
| Cash payments for investments | 80,000,000.00 | 1,005,356,647.12 |
| Net increase of pledged borrowings | ||
| Net cash payments for the acquisition of subsidiaries & other business entities | 39,098,825.84 | 163,501,381.00 |
| Other cash payments related to | 26,271,291.33 | 29,075,689.45 |
| investing activities | ||
| Subtotal of cash outflows from investing activities | 770,100,603.46 | 1,526,077,145.17 |
| Net cash flows from investing activities | -398,594,013.92 | -1,394,891,304.01 |
| III. Cash flows from financing activities: | ||
| Cash receipts from absorbing investments | ||
| Including: Cash received by subsidiaries from non-controlling shareholders as investments | ||
| Cash receipts from borrowings | 3,574,198,154.01 | 1,171,309,980.00 |
| Other cash receipts related to financing activities | 315,512,811.43 | 312,000,744.60 |
| Subtotal of cash inflows from financing activities | 3,889,710,965.44 | 1,483,310,724.60 |
| Cash payments for the repayment of borrowings | 2,639,719,781.54 | 638,734,636.39 |
| Cash payments for distribution of dividends or profits and for interest expenses | 44,740,777.99 | 233,465,936.09 |
| Including: Cash paid by subsidiaries to non-controlling shareholders as dividend or profit | 1,471,395.20 | |
| Other cash payments related to financing activities | 46,125,271.70 | 345,656,817.15 |
| Subtotal of cash outflows from financing activities | 2,730,585,831.23 | 1,217,857,389.63 |
| Net cash flows from financing activities | 1,159,125,134.21 | 265,453,334.97 |
| IV. Effect of foreign exchange rate changes on cash & cash equivalents | 71,124,025.21 | 5,312,049.04 |
| V. Net increase in cash and cash equivalents | 1,602,805,770.74 | -314,238,796.40 |
| Add: Opening balance of cash and cash equivalents | 2,127,457,447.34 | 2,441,696,243.74 |
| VI. Closing balance of cash and cash equivalents | 3,730,263,218.08 | 2,127,457,447.34 |
6、Parent company cash flow statement
Currency: RMB
| Items | Year 2020 | Year 2019 |
| I. Cash flows from operating activities: | ||
| Cash receipts from sale of goods and rendering of services | 4,634,619,462.59 | 3,918,872,688.96 |
| Receipts of tax refund | 500,601,208.07 | 432,238,217.82 |
| Other cash receipts related to operating activities | 353,529,045.37 | 86,132,712.36 |
| Subtotal of cash inflows from operating activities | 5,488,749,716.03 | 4,437,243,619.14 |
| Cash payments for goods purchased and services received | 4,576,674,238.66 | 3,288,242,461.81 |
| Cash paid to employees or payments on behalf of employees | 234,331,254.73 | 225,408,278.43 |
| Cash payments for taxes and rates | 97,173,133.15 | 117,800,459.40 |
| Other cash payments related to operating activities | 274,792,875.73 | 550,582,341.79 |
| Subtotal of cash outflows from operating activities | 5,182,971,502.27 | 4,182,033,541.43 |
| Net cash flows from operating activities | 305,778,213.76 | 255,210,077.71 |
| II. Cash flows from investing activities: | ||
| Cash receipts from withdrawal of investments | 177,154,902.28 | |
| Cash receipts from investment income | 115,654,906.38 | 3,928,865.09 |
| Net cash receipts from the disposal of fixed assets, intangible assets and other long-term assets | 18,031.00 | 127,286.22 |
| Net cash receipts from the disposal of subsidiaries & other business entities | ||
| Other cash receipts related to investing activities | 208,061,898.99 | 107,173,296.88 |
| Subtotal of cash inflows from investing activities | 500,889,738.65 | 111,229,448.19 |
| Cash payments for the acquisition of fixed assets, intangible assets and | 13,598,543.48 | 14,654,175.53 |
| other long-term assets | ||
| Cash payments for investments | 230,099,280.00 | 985,645,415.14 |
| Net cash payments for the acquisition of subsidiaries & other business entities | ||
| Other cash payments related to investing activities | 458,358,211.73 | 126,700,000.00 |
| Subtotal of cash outflows from investing activities | 702,056,035.21 | 1,126,999,590.67 |
| Net cash flows from investing activities | -201,166,296.56 | -1,015,770,142.48 |
| III. Cash flows from financing activities: | ||
| Cash receipts from absorbing investments | ||
| Cash receipts from borrowings | 3,471,565,788.00 | 1,143,678,980.00 |
| Other cash receipts related to financing activities | ||
| Subtotal of cash inflows from financing activities | 3,471,565,788.00 | 1,143,678,980.00 |
| Cash payments for the repayment of borrowings | 2,453,724,990.00 | 485,935,283.39 |
| Cash payments for distribution of dividends or profits and for interest expenses | 33,751,970.50 | 221,926,356.74 |
| Other cash payments related to financing activities | 14,277,150.48 | 14,848,319.55 |
| Subtotal of cash outflows from financing activities | 2,501,754,110.98 | 722,709,959.68 |
| Net cash flows from financing activities | 969,811,677.02 | 420,969,020.32 |
| IV. Effect of foreign exchange rate changes on cash and cash equivalents | 40,696,283.50 | 34,545,158.07 |
| V. Net increase in cash and cash equivalents | 1,115,119,877.72 | -305,045,886.38 |
| Add: Opening balance of cash and cash equivalents | 1,172,525,772.95 | 1,477,571,659.33 |
| VI. Closing balance of cash and cash equivalents | 2,287,645,650.67 | 1,172,525,772.95 |
7、Consolidated statement of changes in equity
Current Period
Currency: RMB
| Items | Year 2020 | ||||||||||||||
| Equity attributable to parent company | Non-controlling interest | Total equity | |||||||||||||
| Share Capital | Other equity instruments | Capital reserve | Less: Treasury shares | Other comprehensive income | Special reserve | Surplus reserve | General risk reserve | Undistributed profit | Others | Subtotal | |||||
| Preferred shares | Perpetual bonds | Others | |||||||||||||
| I. Balance at the end of prior year | 1,075,247,700.00 | 2,036,394,272.83 | 105,492,690.23 | 145,005,399.56 | 429,856,864.70 | 3,849,578,318.39 | 7,430,589,865.25 | 185,843,932.95 | 7,616,433,798.20 | ||||||
| Add: Cumulative changes of accounting policies | |||||||||||||||
| Error correction of prior period | |||||||||||||||
| Business combination under common control | |||||||||||||||
| Others | |||||||||||||||
| II. Balance at the beginning of current year | 1,075,247,700.00 | 2,036,394,272.83 | 105,492,690.23 | 145,005,399.56 | 429,856,864.70 | 3,849,578,318.39 | 7,430,589,865.25 | 185,843,932.95 | 7,616,433,798.20 | ||||||
| III. Current period increase (or less: decrease) | 190,509,257.28 | 58,650,268.32 | -250,842,746.43 | 91,745,899.76 | 1,305,538,034.10 | 1,395,600,713.03 | 25,375,672.07 | 1,420,976,385.10 | |||||||
| (I) Total comprehensive | -203,69 | 1,350,132,51 | 1,146,441,18 | 14,354,421.4 | 1,160,795,60 | ||||||||||
| income | 1,329.48 | 6.91 | 7.43 | 6 | 8.89 | ||||||||||
| (II) Capital contributed or withdrawn by owners | 190,509,257.28 | 190,509,257.28 | 190,509,257.28 | ||||||||||||
| 1. Ordinary shares contributed by owners | |||||||||||||||
| 2. Capital contributed by holders of other equity instruments | 190,509,257.28 | 190,509,257.28 | 190,509,257.28 | ||||||||||||
| 3. Amount of share-based payment included in equity | |||||||||||||||
| 4．Others | |||||||||||||||
| (III) Profit distribution | 91,745,899.76 | -91,745,899.76 | -1,471,395.20 | -1,471,395.20 | |||||||||||
| 1. Appropriation of surplus reserve | 91,745,899.76 | -91,745,899.76 | |||||||||||||
| 2. Appropriation of general risk reserve | |||||||||||||||
| 3. Appropriation of profit to owners | -1,471,395.20 | -1,471,395.20 | |||||||||||||
| 4．Others | |||||||||||||||
| (IV) Internal carry-over | -47,151 | 47,151,416.9 |
| within equity | ,416.95 | 5 | |||||||||||||
| 1. Transfer of capital reserve to capital | |||||||||||||||
| 2. Transfer of surplus reserve to capital | |||||||||||||||
| 3. Surplus reserve to cover losses | |||||||||||||||
| 4. Changes in defined benefit plan carried over to retained earnings | |||||||||||||||
| 5. Other comprehensive income carried over to retained earnings | -47,151,416.95 | 47,151,416.95 | |||||||||||||
| 6．others | |||||||||||||||
| (V) Special reserve | |||||||||||||||
| 1. Appropriation of current period | |||||||||||||||
| 2. Application of current period | |||||||||||||||
| (VI) others | 58,650,268.32 | 58,650,268.32 | 12,492,645.81 | 71,142,914.13 | |||||||||||
| IV. Balance at the end of current period | 1,075,247,700.00 | 190,509,257.28 | 2,095,044,541.15 | 105,492,690.23 | -105,837,346.87 | 521,602,764.46 | 5,155,116,352.49 | 8,826,190,578.28 | 211,219,605.02 | 9,037,410,183.30 |
| Items | Year 2019 | ||||||||||||||
| Equity attributable to parent company | Non-controlling interest | Total equity | |||||||||||||
| Share Capital | Other equity instruments | Capital reserve | Less: Treasury shares | Other comprehensive income | Special reserve | Surplus reserve | General risk reserve | Undistributed profit | Others | Subtotal | |||||
| Preferred shares | Perpetual bonds | Others | |||||||||||||
| I. Balance at the end of prior year | 1,075,247,700.00 | 2,004,946,882.11 | 99,992,601.00 | 77,975,347.31 | 380,177,123.36 | 3,206,473,049.26 | 6,644,827,501.04 | 176,592,084.97 | 6,821,419,586.01 | ||||||
| Add: Cumulative changes of accounting policies | |||||||||||||||
| Error correction of prior period | |||||||||||||||
| Business combination under common control | |||||||||||||||
| Others | |||||||||||||||
| II. Balance at the beginning of current year | 1,075,247,700.00 | 2,004,946,882.11 | 99,992,601.00 | 77,975,347.31 | 380,177,123.36 | 3,206,473,049.26 | 6,644,827,501.04 | 176,592,084.97 | 6,821,419,586.01 | ||||||
| III. Current period increase (or less: decrease) | 31,447,390.72 | 5,500,089.23 | 67,030,052.25 | 49,679,741.34 | 643,105,269.13 | 785,762,364.21 | 9,251,847.98 | 795,014,212.19 | |||||||
| (I) Total comprehensive income | 67,030,052.25 | 895,030,139.78 | 962,060,192.03 | 9,251,847.98 | 971,312,040.01 | ||||||||||
| (II) Capital contributed or withdrawn by | |||||||||||||||
| owners | |||||||||||||||
| 1. Ordinary shares contributed by owners | |||||||||||||||
| 2．Capital contributed by holders of other equity instruments | |||||||||||||||
| 3．Amount of share-based payment included in equity | |||||||||||||||
| 4．Others | |||||||||||||||
| (III) Profit distribution | 49,679,741.34 | -251,924,870.65 | -202,245,129.31 | -202,245,129.31 | |||||||||||
| 1.Appropriation of surplus reserve | 49,679,741.34 | -49,679,741.34 | |||||||||||||
| 2．Appropriation of general risk reserve | |||||||||||||||
| 3．Appropriation of profit to owners | -202,245,129.31 | -202,245,129.31 | -202,245,129.31 | ||||||||||||
| 4．Others | |||||||||||||||
| (IV) Internal carry-over within equity | |||||||||||||||
| 1．Transfer of capital reserve to capital | |||||||||||||||
| 2．Transfer of surplus reserve to capital |
| 3．Surplus reserve to cover losses | |||||||||||||||
| 4．Changes in defined benefit plan carried over to retained earnings | |||||||||||||||
| 5．Other comprehensive income carried over to retained earnings | |||||||||||||||
| 6．Others | |||||||||||||||
| (V) Special reserve | |||||||||||||||
| 1. Appropriation of current period | |||||||||||||||
| 2．Application of current period | |||||||||||||||
| (VI) Others | 31,447,390.72 | 5,500,089.23 | 25,947,301.49 | 25,947,301.49 | |||||||||||
| IV. Balance at the end of current period | 1,075,247,700.00 | 2,036,394,272.83 | 105,492,690.23 | 145,005,399.56 | 429,856,864.70 | 3,849,578,318.39 | 7,430,589,865.25 | 185,843,932.95 | 7,616,433,798.20 |
| Items | Year 2020 | |||||||||||
| Share Capital | Other equity instruments | Capital reserve | Less: Treasury shares | Other comprehensive Income | Special reserve | Surplus reserve | Undistributed profit | Others | Total equity | |||
| Preferred Shares | Perpetual bonds | Others | ||||||||||
| I. Balance at the end of prior year | 1,075,247,700.00 | 2,042,882,286.04 | 105,492,690.23 | 43,484,350.56 | 426,108,567.79 | 2,733,232,440.73 | 6,215,462,654.89 | |||||
| Add: Cumulative changes of accounting policies | ||||||||||||
| Error correction of prior period | ||||||||||||
| Others | ||||||||||||
| II. Balance at the beginning of current year | 1,075,247,700.00 | 2,042,882,286.04 | 105,492,690.23 | 43,484,350.56 | 426,108,567.79 | 2,733,232,440.73 | 6,215,462,654.89 | |||||
| III. Current period increase (or less: decrease) | 190,509,257.28 | 60,610,079.08 | -70,870,086.60 | 91,745,899.76 | 872,864,514.78 | 1,144,859,664.30 | ||||||
| (I) Total comprehensive income | -23,718,669.65 | 917,458,997.59 | 893,740,327.94 | |||||||||
| (II) Capital contributed or withdrawn by owners | 190,509,257.28 | 190,509,257.28 | ||||||||||
| 1. Ordinary shares contributed by owners | ||||||||||||
| 2. Capital contributed by holders of other equity instruments | 190,509,257.28 | 190,509,257.28 | ||||||||||
| 3. Amount of share-based payment included in equity | ||||||||||||
| 4．Others |
| (III) Profit distribution | 91,745,899.76 | -91,745,899.76 | ||||||||||
| 1. Appropriation of surplus reserve | 91,745,899.76 | -91,745,899.76 | ||||||||||
| 2. Appropriation of profit to owners | ||||||||||||
| 3．Others | ||||||||||||
| (IV) Internal carry-over within equity | -47,151,416.95 | 47,151,416.95 | ||||||||||
| 1. Transfer of capital reserve to capital | ||||||||||||
| 2. Transfer of surplus reserve to capital | ||||||||||||
| 3. Surplus reserve to cover losses | ||||||||||||
| 4. Changes in defined benefit plan carried over to retained earnings | ||||||||||||
| 5. Other comprehensive income carried over to retained earnings | -47,151,416.95 | 47,151,416.95 | ||||||||||
| 6. Others | ||||||||||||
| (V) Special reserve | ||||||||||||
| 1．Appropriation of current period | ||||||||||||
| 2．Application of current period |
| (VI) Others | 60,610,079.08 | 60,610,079.08 | ||||||||||
| IV. Balance at the end of current period | 1,075,247,700.00 | 190,509,257.28 | 2,103,492,365.12 | 105,492,690.23 | -27,385,736.04 | 517,854,467.55 | 3,606,096,955.51 | 7,360,322,319.19 |
| Items | Year 2019 | |||||||||||
| Share Capital | Other equity instruments | Capital reserve | Less: Treasury shares | Other comprehensive Income | Special reserve | Surplus reserve | Undistributed profit | Others | Total equity | |||
| Preferred Shares | Perpetual bonds | Others | ||||||||||
| I. Balance at the end of prior year | 1,075,247,700.00 | 2,011,434,895.32 | 99,992,601.00 | 3,218,677.52 | 376,428,826.45 | 2,488,359,897.98 | 5,854,697,396.27 | |||||
| Add: Cumulative changes of accounting policies | ||||||||||||
| Error correction of prior period | ||||||||||||
| Others | ||||||||||||
| II. Balance at the beginning of current year | 1,075,247,700.00 | 2,011,434,895.32 | 99,992,601.00 | 3,218,677.52 | 376,428,826.45 | 2,488,359,897.98 | 5,854,697,396.27 | |||||
| III. Current period increase (or less: decrease) | 31,447,390.72 | 5,500,089.23 | 40,265,673.04 | 49,679,741.34 | 244,872,542.75 | 360,765,258.62 | ||||||
| (I) Total comprehensive income | 40,265,673.04 | 496,797,413.40 | 537,063,086.44 | |||||||||
| (II) Capital contributed or withdrawn by owners | ||||||||||||
| 1. Ordinary shares contributed by owners | ||||||||||||
| 2. Capital contributed by holders of other equity instruments | ||||||||||||
| 3. Amount of share-based payment included in equity | ||||||||||||
| 4．Others | ||||||||||||
| (III) Profit distribution | 49,679,741.34 | -251,924,870.65 | -202,245,129.31 | |||||||||
| 1. Appropriation of surplus reserve | 49,679,741.34 | -49,679,741.34 | ||||||||||
| 2．Appropriation of profit to owners | -202,245,129.31 | -202,245,129.31 | ||||||||||
| 3．Others | ||||||||||||
| (IV) Internal carry-over within equity | ||||||||||||
| 1．Transfer of capital reserve to capital | ||||||||||||
| 2．Transfer of surplus reserve to capital | ||||||||||||
| 3．Surplus reserve to cover losses | ||||||||||||
| 4．Changes in defined benefit plan carried |
| over to retained earnings | ||||||||||||
| 5．Other comprehensive income carried over to retained earnings | ||||||||||||
| 6．Others | ||||||||||||
| (V) Special reserve | ||||||||||||
| 1．Appropriation of current period | ||||||||||||
| 2．Application of current period | ||||||||||||
| (VI) Others | 31,447,390.72 | 5,500,089.23 | 25,947,301.49 | |||||||||
| IV. Balance at the end of current period | 1,075,247,700.00 | 2,042,882,286.04 | 105,492,690.23 | 43,484,350.56 | 426,108,567.79 | 2,733,232,440.73 | 6,215,462,654.89 |
巨星国际有限公司 (Hong Kong Great Star International Co., Ltd.), Great Star Tools USA, Inc, GreatStar Europe AG, 海宁巨星智能设备有限公司 (Haining Great Star Intelligent Equipment Co., Ltd.) into the consolidation scope. Please refer to section XII (IX)Interest in other entities of notes to financial statements for details.
IV. Preparation basis of the financial statements
1、Preparation basis
The financial statements have been prepared on the basis of going concern.
2、Assessment of the ability to continue as a going concern
The Company has no events or conditions that may cast significant doubts upon the Company’s ability to continue as a goingconcern within the 12 months after the balance sheet date.V. Significant accounting policies and estimatesDetailed significant accounting policies and estimates notes:
The Company has set up accounting policies and estimates on transactions or events such as impairment of financial instruments,depreciation of fixed assets, depreciation of right-of-use assets, amortization of intangible assets, and revenue recognition, etc. basedon the Company’s actual production and operation features.
1、 Statement of compliance
The financial statements have been prepared in accordance with the requirements of China Accounting Standards for BusinessEnterprises (CASBEs), and present truly and completely the financial position, results of operations and cash flows of the Company.
2、 Accounting period
The accounting year of the Company runs from January 1 to December 31 under the Gregorian calendar.
3、 Operating cycle
The Company has a relatively short operating cycle for its business, an asset or a liability is classified as current if it is expectedto be realized or due within 12 months.
4、Functional currency
The functional currency of the Company and its domestic subsidiaries is Renminbi (RMB) , while the functional currency ofsubsidiaries engaged in overseas operations including Hong Kong Great Star International Co., Ltd., Great Star Tools USA, Inc andGreatStar Europe AG is the currency of the primary economic environment in which they operate.
5、Accounting treatments of business combination under and not under common control
1. Accounting treatment of business combination under common control
Assets and liabilities arising from business combination are measured at carrying amount of the combined party included in theconsolidated financial statements of the ultimate controlling party at the combination date. Difference between carrying amount of theequity of the combined party included in the consolidated financial statements of the ultimate controlling party and that of thecombination consideration or total par value of shares issued is adjusted to capital reserve, if the balance of capital reserve is insufficientto offset, any excess is adjusted to retained earnings.
2. Accounting treatment of business combination not under common control
When combination cost is in excess of the fair value of identifiable net assets obtained from the acquiree at the acquisition date,the excess is recognized as goodwill; otherwise, the fair value of identifiable assets, liabilities and contingent liabilities, and themeasurement of the combination cost are reviewed, then the difference is recognized in profit or loss.
6、Compilation method of consolidated financial statements
The parent company brings all its controlled subsidiaries into the consolidation scope. The consolidated financial statements arecompiled by the parent company according to “CASBE 33 – Consolidated Financial Statements”, based on relevant information andthe financial statements of the parent company and its subsidiaries.
7、 Classification of joint arrangements and accounting treatment of joint operations
1. Joint arrangements include joint operations and joint ventures.
2. When the Company is a joint operator of a joint operation, it recognizes the following items in relation to its interest in a jointoperation:
(1) its assets, including its share of any assets held jointly;
(2) its liabilities, including its share of any liabilities incurred jointly;
(3) its revenue from the sale of its share of the output arising from the joint operation;
(4) its share of the revenue from the sales of the assets by the joint operation; and
(5) its expenses, including its share of any expenses incurred jointly.
8、Recognition criteria of cash and cash equivalents
Cash as presented in cash flow statement refers to cash on hand and deposit on demand for payment. Cash equivalents refer toshort-term, highly liquid investments that can be readily converted to cash and that are subject to an insignificant risk of changes invalue.
9、 Foreign currency translation
1. Translation of transactions denominated in foreign currency
Transactions denominated in foreign currency are translated into RMB at the spot exchange rate at the transaction date at initialrecognition. At the balance sheet date, monetary items denominated in foreign currency are translated at the spot exchange rate at thebalance sheet date with difference, except for those arising from the principal and interest of exclusive borrowings eligible forcapitalization, included in profit or loss; non-cash items carried at historical costs are translated at the spot exchange rate at thetransaction date, with the RMB amounts unchanged; non-cash items carried at fair value in foreign currency are translated at the spotexchange rate at the date when the fair value was determined, with difference included in profit or loss or other comprehensive income.
2. Translation of financial statements measured in foreign currency
The assets and liabilities in the balance sheet are translated into RMB at the spot rate at the balance sheet date; the equity items,other than undistributed profit, are translated at the spot rate at the transaction date; the revenues and expenses in the income statementare translated into RMB at the spot exchange rate at the transaction date. The difference arising from the aforementioned foreigncurrency translation is included in other comprehensive income.10、Financial instruments
1. Classification of financial assets and financial liabilities
Financial assets are classified into the following three categories when initially recognized: (1) financial assets at amortized cost;
(2) financial assets at fair value through other comprehensive income; (3) financial assets at fair value through profit or loss.
Financial liabilities are classified into the following four categories when initially recognized: (1) financial liabilities at fair valuethrough profit or loss; (2) financial liabilities that arise when a transfer of a financial asset does not qualify for derecognition or when
the continuing involvement approach applies; (3) financial guarantee contracts not fall within the above categories (1) and (2), andcommitments to provide a loan at a below-market interest rate, which do not fall within the above category (1); (4) financial liabilitiesat amortized cost.
2. Recognition criteria, measurement method and derecognition condition of financial assets and financial liabilities
(1) Recognition criteria and measurement method of financial assets and financial liabilities
When the Company becomes a party to a financial instrument, it is recognized as a financial asset or financial liability. Thefinancial assets and financial liabilities initially recognized by the Company are measured at fair value; for the financial assets andliabilities at fair value through profit or loss, the transaction expenses thereof are directly included in profit or loss; for other categoriesof financial assets and financial liabilities, the transaction expenses thereof are included into the initially recognized amount. However,at initial recognition, for accounts receivables that do not contain a significant financing component or in circumstances where theCompany does not consider the financing components in contracts within one year,, the Company measures their transaction price inaccordance with “CASBE 14 – Revenues”.
(2) Subsequent measurement of financial assets
1) Financial assets measured at amortized cost
The Company measures its financial assets at the amortized costs using effective interest method. Gains or losses on financialassets that are measured at amortized cost and are not part of hedging relationships shall be included into profit or loss when thefinancial assets are derecognized, reclassified, amortized using effective interest method or recognized with impairment loss.
2) Debt instrument investments at fair value through other comprehensive income
The Company measures its debt instrument investments at fair value. Interests, impairment gains or losses, and gains and losseson foreign exchange that calculated using effective interest method shall be included into profit or loss, while other gains or losses areincluded into other comprehensive income. Accumulated gains or losses that initially recognized as other comprehensive income shouldbe transferred out into profit or loss when the financial assets are derecognized.
3) Equity instrument investments at fair value through other comprehensive income
The Company measures its equity instrument investments at fair value. Dividends obtained (other than those as part of investmentcost recovery) shall be included into profit or loss, while other gains or losses are included into other comprehensive income.Accumulated gains or losses that initially recognized as other comprehensive income should be transferred out into retained earningswhen the financial assets are derecognized.
4) Financial assets at fair value through profit or loss
The Company measures its financial assets at fair value. Gains or losses arising from changes in fair value (including interestsand dividends) shall be included into profit or loss, except for financial assets that are part of hedging relationships.
(3) Subsequent measurement of financial liabilities
1) Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss include held-for-trading financial liabilities (including derivatives that areliabilities) and financial liabilities designated as at fair value through profit or loss. The Company measures such kind of liabilities atfair value. The amount of changes in the fair value of the financial liabilities that are attributable to changes in the Company’s owncredit risk shall be included into other comprehensive income, unless such treatment would create or enlarge accounting mismatchesin profit or loss. Other gains or losses on those financial liabilities (including interests, changes in fair value that are attributable toreasons other than changes in the Company’s own credit risk) shall be included into profit or loss, except for financial liabilities thatare part of hedging relationships. Accumulated gains or losses that originally recognized as other comprehensive income should betransferred out into retained earnings when the financial liabilities are derecognized.
2) Financial liabilities that arise when a transfer of a financial asset does not qualify for derecognition or when the continuinginvolvement approach applies
The Company measures its financial liabilities in accordance with “CASBE 23 – Transfer of Financial Assets”
3) Financial guarantee contracts not fall within the above categories 1) and 2), and commitments to provide a loan at a below-market interest rate, which do not fall within the above category 1)
The Company measures its financial liabilities at the higher of: a. the amount of loss allowances in accordance with impairmentrequirements of financial instruments; b. the amount initially recognized less the amount of accumulated amortization recognized inaccordance with “CASBE 14 – Revenues”.
4) Financial liabilities at amortized cost
The Company measures its financial liabilities at amortized cost using effective interest method. Gains or losses on financialliabilities that are measured at amortized cost and are not part of hedging relationships shall be included into profit or loss when thefinancial liabilities are derecognized and amortized using effective interest method.
(4) Derecognition of financial assets and financial liabilities
1) Financial assets are derecognized when:
a. the contractual rights to the cash flows from the financial assets expire; or
b. the financial assets have been transferred and the transfer qualifies for derecognition in accordance with “CASBE 23 – Transferof Financial Assets”.
2) Only when the underlying present obligations of a financial liability are relieved totally or partly may the financial liability bederecognized accordingly.
3. Recognition criteria and measurement method of financial assets transfer
Where the Company has transferred substantially all of the risks and rewards related to the ownership of the financial asset, itderecognizes the financial asset, and any right or liability arising from such transfer is recognized independently as an asset or a liability.If it retained substantially all of the risks and rewards related to the ownership of the financial asset, it continues recognizing thefinancial asset. Where the Company does not transfer or retain substantially all of the risks and rewards related to the ownership of afinancial asset, it is dealt with according to the circumstances as follows respectively: (1) if the Company does not retain its controlover the financial asset, it derecognizes the financial asset, and any right or liability arising from such transfer is recognizedindependently as an asset or a liability; (2) if the Company retains its control over the financial asset, according to the extent of itscontinuing involvement in the transferred financial asset, it recognizes the related financial asset and recognizes the relevant liabilityaccordingly.If the transfer of an entire financial asset satisfies the conditions for derecognition, the difference between the amounts of thefollowing two items are included in profit or loss: (1) the carrying amount of the transferred financial asset as of the date ofderecognition; (2) the sum of consideration received from the transfer of the financial asset, and the accumulative amount of the changesof the fair value originally included in other comprehensive income proportionate to the transferred financial asset (financial assetstransferred refer to debt instrument investments at fair value through other comprehensive income). If the transfer of financial assetpartially satisfies the conditions to derecognition, the entire carrying amount of the transferred financial asset is, between the portionwhich is derecognized and the portion which is not, apportioned according to their respective relative fair value, and the differencebetween the amounts of the following two items are included into profit or loss: (1) the carrying amount of the portion which isderecognized; (2) the sum of consideration of the portion which is derecognized, and the portion of the accumulative amount of thechanges in the fair value originally included in other comprehensive income which is corresponding to the portion which isderecognized (financial assets transferred refer to debt instrument investments at fair value through other comprehensive income).
4. Fair value determination method of financial assets and liabilities
The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available tomeasure fair value. The inputs to valuation techniques used to measure fair value are arranged in the following hierarchy and usedaccordingly:
(1) Level 1 inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company can access
at the measurement date.
(2) Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, eitherdirectly or indirectly. Level 2 inputs include: quoted prices for similar assets or liabilities in active markets; quoted prices for identicalor similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability,for example, interest rates and yield curves observable at commonly quoted intervals; market-corroborated inputs;
(3) Level 3 inputs are unobservable inputs for the asset or liability. Level 3 inputs include interest rate that is not observable andcannot be corroborated by observable market data at commonly quoted intervals, historical volatility, future cash flows to be paid tofulfill the disposal obligation assumed in business combination, and financial forecast developed using the Company’s own data, etc.
5. Impairment of financial instruments
(1) Measurement and accounting treatment
The Company, on the basis of expected credit loss, recognizes loss allowances of financial assets at amortized cost, debtinstrument investments, contract assets or leases receivable at fair value through other comprehensive income, loan commitments otherthan financial liabilities at fair value through profit or loss, financial guarantee contracts not belong to financial liabilities at fair valuethrough profit or loss or financial liabilities that arise when a transfer of a financial asset does not qualify for derecognition or whenthe continuing involvement approach applies.
Expected credit losses refer to the weighted average of credit losses with the respective risks of a default occurring as the weights.Credit loss refers to the difference between all contractual cash flows that are due to the Company in accordance with the contract andall the cash flows that the Company expects to receive (i.e. all cash shortfalls), discounted at the original effective interest rate. Amongwhich, purchased or originated credit-impaired financial assets are discounted at the credit-adjusted effective interest rate.
At the balance sheet date, the Company shall only recognize the cumulative changes in the lifetime expected credit losses sinceinitial recognition as a loss allowance for purchased or originated credit-impaired financial assets.
For accounts receivable and contract assets resulting from transactions as regulated in “CASBE 14 – Revenues” which do notcontain a significant financing component or in circumstances where the Company does not consider the financing components incontracts within one year,, the Company chooses simplified approach to measure the loss allowance at an amount equal to lifetimeexpected credit losses.
For financial assets other than the above, on each balance sheet date, the Company shall assess whether the credit risk on thefinancial instrument has increased significantly since initial recognition. The Company shall measure the loss allowance for thefinancial instrument at an amount equal to the lifetime expected credit losses if the credit risk on that financial instrument has increasedsignificantly since initial recognition; otherwise, the Company shall measure the loss allowance for that financial instrument at anamount equal to 12-month expected credit loss.
Considering reasonable and supportable forward-looking information, the Company compares the risk of a default occurring onthe financial instrument as at the balance sheet date with the risk of a default occurring on the financial instrument as at the date ofinitial recognition, so as to assess whether the credit risk on the financial instrument has increased significantly since initial recognition.
The Company may assume that the credit risk on a financial instrument has not increased significantly since initial recognitionif the financial instrument is determined to have relatively low credit risk at the balance sheet date.
The Company shall estimate expected credit risk and measure expected credit losses on an individual or a collective basis. Whenthe Company adopts the collective basis, financial instruments are grouped with similar credit risk features.
The Company shall remeasure expected credit loss on each balance sheet date, and increased or reversed amounts of lossallowance arising therefrom shall be included into profit or loss as impairment losses or gains. For a financial asset measured atamortized cost, the loss allowance reduces the carrying amount of such financial asset presented in the balance sheet; for a debtinvestment measured at fair value through other comprehensive income, the loss allowance shall be recognized in other comprehensiveincome and shall not reduce the carrying amount of such financial asset.
(2) Financial instruments with expected credit risk assessed and expected credit losses measured on a collective basis
| Items | Basis for determination of portfolio | Method for measuring expected credit loss |
| Other receivables – Portfolio grouped with ages | Ages | Based on historical credit loss experience, the current situation and the forecast of future economic conditions, the Company calculates expected credit loss through exposure at default and 12-month or lifetime expected credit loss rate. |
| Other receivables – Portfolio grouped balance due from related parties within the consolidation scope | Balance due from related parties within the consolidation scope | Based on historical credit loss experience, the current situation and the forecast of future economic conditions, the Company calculates expected credit loss through exposure at default and 12-month or lifetime expected credit loss rate. |
| Items | Basis for determination of portfolio | Method for measuring expected credit loss |
| Bank acceptance receivable | Type of notes | Based on historical credit loss experience, the current situation and the forecast of future economic conditions, the Company calculates expected credit loss through exposure at default and lifetime expected credit loss rate. |
| Trade acceptance receivable | ||
| Accounts receivable – Portfolio grouped with ages | Ages | Based on historical credit loss experience, the current situation and the forecast of future economic conditions, the Company prepares the comparison table of ages and lifetime expected |
credit loss rate of accounts receivable,so as to calculate expected credit loss.
2) Accounts receivable – comparison table of ages and lifetime expected credit loss rate of portfolio grouped with ages
| Ages | Expected credit loss rate(%) |
| Within 1 year (inclusive, the same hereinafter) | 5.00 |
| 1-2 years | 10.00 |
| 2-3 years | 20.00 |
| 3-4 years | 30.00 |
| 4-5 years | 50.00 |
| Over 5 years | 100.00 |
14、 Other Receivables
Recognition method and accounting treatment of expected credit loss of the other receivableDetails refer to the Section V、Significant accounting policies and estimates 10、Financial instruments of the financial statementsnotes
15、 Inventories
1. Classification of inventories
Inventories include finished goods or goods held for sale in the ordinary course of business, work in process in the process ofproduction, and materials or supplies etc. to be consumed in the production process or in the rendering of services.
2. Accounting method for dispatching inventories:
Inventories dispatched from storage are accounted for with weighted average method at the end of each month.
3. Basis for determining net realizable value
At the balance sheet date, inventories are measured at the lower of cost and net realizable value; provisions for inventory write-down are made on the excess of its cost over the net realizable value. The net realizable value of inventories held for sale is determinedbased on the amount of the estimated selling price less the estimated selling expenses and relevant taxes and surcharges in the ordinarycourse of business; the net realizable value of materials to be processed is determined based on the amount of the estimated sellingprice less the estimated costs of completion, selling expenses and relevant taxes and surcharges in the ordinary course of business; atthe balance sheet date, when only part of the same item of inventories have agreed price, their net realizable value is determinedseparately and is compared with their costs to set the provision for inventory write-down to be made or reversed.
4. Inventory system
Perpetual inventory method is adopted.
5. Amortization method of low-value consumables and packages
(1) Low-value consumables
Low-value consumables are amortized with one-off method.
(2) Packages
Packages are amortized with one-off method.
16、 Contract assets
The Company presents contract assets or contract liabilities in the balance sheet based on the relationship between its performanceobligations and customers’ payments. Contract assets and contract liabilities under the same contract shall offset each other and bepresented on a net basis.The Company presents an unconditional right to consideration (i.e., only the passage of time is required before the considerationis due) as a receivable, and presents a right to consideration in exchange for goods that it has transferred to a customer (which isconditional on something other than the passage of time) as a contract asset.
17、 Contract costs
Assets related to contract costs including costs of obtaining a contract and costs to fulfil a contract.
The Company recognizes as an asset the incremental costs of obtaining a contract if those costs are expected to be recovered.The costs of obtaining a contract shall be included into profit or loss when incurred if the amortization period of the asset is one yearor less.
If the costs incurred in fulfilling a contract are not within the scope of standards related to inventories, fixed assets or intangibleassets, etc., the Company shall recognize the costs to fulfil a contract as an asset if all the following criteria are satisfied:
1. The costs relate directly to a contract or to an anticipated contract, including direct labor, direct materials, manufacturingoverhead cost (or similar cost), cost that are explicitly chargeable to the customer under the contract, and other costs that are onlyrelated to the contract;
2. The costs enhance resources of the Company that will be used in satisfying performance obligations in the future; and
3. The costs are expected to be recovered.
An asset related to contract costs shall be amortized on a systematic basis that is consistent with related goods or services, withamortization included into profit or loss.
The Company shall make provision for impairment and recognize an impairment loss to the extent that the carrying amount ofan asset related to contract costs exceeds the remaining amount of consideration that the Company expects to receive in exchange forthe goods or services to which the asset relates less the costs expected to be incurred. The Company shall recognize a reversal of animpairment loss previously recognized in profit or loss when the impairment conditions no longer exist or have improved. The carryingamount of the asset after the reversal shall not exceed the amount that would have been determined on the reversal date if no provisionfor impairment had been made previously.
18、 Non-current assets or disposal groups classified as held for sale
1. Classification of non-current assets or disposal groups as held for sale
Non-current assets or disposal groups are accounted for as held for sale when the following conditions are all met: a. the assetmust be available for immediate sale in its present condition subject to terms that are usual and customary for sales of such assets ordisposal groups; b. its sales must be highly probable, i.e., the Company has made a decision on the sale plan and has obtained a firmpurchase commitment, and the sale is expected to be completed within one year.
When the Company acquires a non-current asset or disposal group with a view to resale, it shall classify the non-current asset ordisposal group as held for sale at the acquisition date only if the requirement of “expected to be completed within one year” is met atthat date and it is highly probable that other criteria for held for sale will be met within a short period (usually within three months).
An asset or a disposal group is still accounted for as held for sale when the Company remains committed to its plan to sell theasset or disposal group in the circumstance that non-related party transactions fail to be completed within one year due to one of thefollowing reasons: a. a buyer or others unexpectedly set conditions that will extend the sale period, while the Company has taken timelyactions to respond to the conditions and expects a favorable resolution of the delaying factors within one year since the setting; b. anon-current asset or disposal group classified as held for sale fails to be sold within one year due to rare cases, and the Company hastaken action necessary to respond to the circumstances during the initial one-year period and the criteria for held for sale are met.
2. Measurement of non-current assets or disposal groups as held for sale
(1) Initial measurement and subsequent measurement
For initial measurement and subsequent measurement as at the balance sheet date of a non-current asset or disposal group as heldfor sale, where the carrying amount is higher than the fair value less costs to sell, the carrying amount is written down to the fair valueless costs to sell, and the write-down is recognized in profit or loss as assets impairment loss, meanwhile, provision for impairment ofassets as held for sale shall be made.
For a non-current asset or disposal group classified as held for sale at the acquisition date, the asset or disposal group is measuredon initial recognition at the lower of its initial measurement amount had it not been so classified and fair value less costs to sell. Apartfrom the non-current asset or disposal group acquired through business combination, the difference arising from the initial recognitionof a non-current asset or disposal group at the fair value less costs to sell shall be included into profit or loss.
The assets impairment loss recognized for a disposal group as held for sale shall reduce the carrying amount of goodwill in thedisposal group first, and then reduce its carrying amount based on the proportion of each non-current asset’s carrying amount in thedisposal group.
No provision for depreciation or amortization shall be made on non-current assets as held for sale or non-current assets in disposal
groups as held for sale, while interest and other expenses attributable to the liabilities of a disposal group as held for sale shall continueto be recognized.
(2) Reversal of assets impairment loss
When there is a subsequent increase in fair value less costs to sell of a non-current asset as held for sale at the balance sheet date,the write-down shall be recovered, and shall be reversed not in excess of the impairment loss that has been recognized after the non-current asset was classified as held for sale. The reversal shall be included into profit or loss. Assets impairment loss that has beenrecognized before the classification is not reversed.
When there is a subsequent increase in fair value less costs to sell of a disposal group as held for sale at the balance sheet date,the write-down shall be recovered, and shall be reversed not in excess of the non-current assets impairment loss that has been recognizedafter the disposal group was classified as held for sale. The reversal shall be included into profit or loss. The reduced carrying amountof goodwill and non-current assets impairment loss that has been recognized before the classification is not reversed.
For the subsequent reversal of the impairment loss that has been recognized in a disposal group as held for sale, the carryingamount is increased based on the proportion of carrying amount of each non-current asset (excluding goodwill) in the disposal group.
(3) Non-current asset or disposal group that is no longer classified as held for sale and derecognized
A non-current asset or disposal group that does not met criteria for held for sale and no longer classified as held for sale, or anon-current asset that removed from a disposal group as held for sale shall be measured at the lower of: a. its carrying amount beforeit was classified as held for sale, adjusted for any depreciation, amortization or impairment that would have been recognized had it notbeen classified as held for sale; and b. its recoverable amount.
When a non-current asset or disposal group classified as held for sale is derecognized, unrecognized gains or losses shall beincluded into profit or loss.
19、 Debt investments
20、 Other debt investments
21、 Long-term receivables
22、 Long-term equity investments
1. Judgment of joint control and significant influence
Joint control is the contractually agreed sharing of control of an arrangement, which exists only when decisions about the relevant
activities require the unanimous consent of the parties sharing control. Significant influence is the power to participate in the financialand operating policy decisions of the investee but is not control or joint control of these policies.
2. Determination of investment cost
(1) For business combination under common control, if the consideration of the combining party is that it makes payment in cash,transfers non-cash assets, assumes its liabilities or issues equity securities, on the date of combination, it regards the share of thecarrying amount of the equity of the combined party included in the consolidated financial statements of the ultimate controlling partyas the initial cost of the investment. The difference between the initial cost of the long-term equity investments and the carrying amountof the combination consideration paid or the par value of shares issued offsets capital reserve; if the balance of capital reserve isinsufficient to offset, any excess is adjusted to retained earnings.When long-term equity investments are obtained through business combination under common control achieved in stages, theCompany determines whether it is a “bundled transaction”. If it is a “bundled transaction”, stages as a whole are considered as onetransaction in accounting treatment. If it is not a “bundled transaction”, on the date of combination, investment cost is initiallyrecognized at the share of the carrying amount of net assets of the combined party included the consolidated financial statements of theultimate controlling party. The difference between the initial investment cost of long-term equity investments at the acquisition dateand the carrying amount of the previously held long-term equity investments plus the carrying amount of the consideration paid for thenewly acquired equity is adjusted to capital reserve; if the balance of capital reserve is insufficient to offset, any excess is adjusted toretained earnings.
(2) For business combination not under common control, investment cost is initially recognized at the acquisition-date fair valueof considerations paid.
When long-term equity investments are obtained through business combination not under common control achieved in stages,the Company determined whether they are stand-alone financial statements or consolidated financial statements in accounting treatment:
1) In the case of stand-alone financial statements, investment cost is initially recognized at the carrying amount of the previouslyheld long-term equity investments plus the carrying amount of the consideration paid for the newly acquired equity.
2) In the case of consolidated financial statements, the Company determines whether it is a “bundled transaction”. If it is a“bundled transaction”, stages as a whole are considered as one transaction in accounting treatment. If it is not a “bundled transaction”,the carrying amount of the acquirer’s previously held equity interest in the acquiree is remeasured at the acquisition-date fair value,and the difference between the fair value and the carrying amount is recognized in investment income; when the acquirer’s previouslyheld equity interest in the acquiree involves other comprehensive income under equity method, the related other comprehensive incomeis reclassified as income for the acquisition period, excluding other comprehensive income arising from changes in net liabilities orassets from remeasurement of defined benefit plan of the acquiree.
(3) Long-term equity investments obtained through ways other than business combination: the initial cost of a long-term equityinvestment obtained by making payment in cash is the purchase cost which is actually paid; that obtained on the basis of issuing equitysecurities is the fair value of the equity securities issued; that obtained through debt restructuring is determined according to “CASBE12 – Debt Restructuring”; and that obtained through non-cash assets exchange is determined according to “CASBE 7 – Non-cashAssets Exchange”.
3. Subsequent measurement and recognition method of profit or loss
For long-term equity investments with control relationship, it is accounted for with cost method; for long-term equity investmentswith joint control or significant influence relationship, it is accounted for with equity method.
4. Disposal of a subsidiary in stages resulting in the Company’s loss of control
(1) Stand-alone financial statements
The difference between the carrying amount of the disposed equity and the consideration obtained thereof is recognized in profitor loss. If the disposal does not result in the Company’s loss of significant influence or joint control, the remained equity is accountedfor with equity method; however, if the disposal results in the Company’s loss of control, joint control, or significant influence, theremained equity is accounted for according to “CASBE 22 – Financial Instruments: Recognition and Measurement”.
(2) Consolidated financial statements
1) Disposal of a subsidiary in stages not qualified as “bundled transaction” resulting in the Company’s loss of control
Before the Company’s loss of control, the difference between the disposal consideration and the proportionate share of net assetsin the disposed subsidiary from acquisition date or combination date to the disposal date is adjusted to capital reserve (capital premium),if the balance of capital reserve is insufficient to offset, any excess is adjusted to retained earnings.
When the Company loses control, the remained equity is remeasured at the loss-of-control-date fair value. The aggregated valueof disposal consideration and the fair value of the remained equity, less the share of net assets in the disposed subsidiary held beforethe disposal from the acquisition date or combination date to the disposal date is recognized in investment income in the period whenthe Company loses control over such subsidiary, and meanwhile goodwill is offset correspondingly. Other comprehensive incomerelated to equity investments in former subsidiary is reclassified as investment income upon the Company’s loss of control.
2) Disposal of a subsidiary in stages qualified as “bundled transaction” resulting in the Company’s loss of control
In case of “bundled transaction”, stages as a whole are considered as one transaction resulting in loss of control in accountingtreatment. However, before the Company loses control, the difference between the disposal consideration at each stage and theproportionate share of net assets in the disposed subsidiary is recognized as other comprehensive income at the consolidated financialstatements and reclassified as profit or loss in the period when the Company loses control over such subsidiary.
23、 Investment property
Investment property measurement modelMeasurement by cost modelThe depreciation or amortization method
1. Investment property includes land use right of leased-out property and of property held for capital appreciation and buildingsthat have been leased out.
2. The initial measurement of investment property is based on its cost, and subsequent measurement is made using the cost model,the depreciation or amortization method is the same as that of fixed assets and intangible assets.
24、 Fixed assets
1. Recognition principles of fixed assets
Fixed assets are tangible assets held for use in the production of goods or rendering of services, for rental to others, or foradministrative purposes, and expected to be used during more than one accounting year. Fixed assets are recognized if, and only if, itis probable that future economic benefits associated with the assets will flow to the Company and the cost of the assets can bemeasured reliably.
2. Depreciation method of different categories of fixed assets
| Categories | Depreciation method | Useful life (years) | Residual value proportion (%) | Annual depreciation rate (%) |
| Buildings and structures | Straight-line method | 20-25 | 0、5 | 5.00-3.80 |
| General equipment | Straight-line method | 3-10 | 0、10 | 33.33-9.00 |
| Special equipment | Straight-line method | 5-15 | 0、10 | 20.00-6.00 |
| Transport facilities | Straight-line method | 4-10 | 5、10 | 23.75-9.00 |
transfer to the lessee; (4) the present value of the minimum amount of rent that the lessee has to pay at the first day of the leaseamounts to 90% or higher of its fair value at the same date; or the present value of the minimum amount of rent that the lessorcollects at the first day of the lease amounts to 90% or higher of its fair value at the same date; and/or (5) the leased assets are of sucha specialized nature that only the lessee can use them without major modifications. Fixed assets rented-in under finance lease arerecorded at the lower of fair value and the present value of the minimum lease payment at the inception of the lease, and aredepreciated following the depreciation policy for self-owned fixed assets.
25、 Construction in progress
1. Construction in progress is recognized if, and only if, it is probable that future economic benefits associated with the item willflow to the Company, and the cost of the item can be measured reliably. Construction in progress is measured at the actual cost incurredto reach its designed usable conditions.
2. Construction in progress is transferred into fixed assets at its actual cost when it reaches the designed usable conditions. Whenthe auditing of the construction in progress was not finished while reaching the designed usable conditions, it is transferred to fixedassets using estimated value first, and then adjusted accordingly when the actual cost is settled, but the accumulated depreciation is notto be adjusted retrospectively.
26、Borrowing costs
1. Recognition principle of borrowing costs capitalization
Where the borrowing costs incurred to the Company can be directly attributable to the acquisition and construction or productionof assets eligible for capitalization, it is capitalized and included in the costs of relevant assets; other borrowing costs are recognizedas expenses on the basis of the actual amount incurred, and are included in profit or loss.
2. Borrowing costs capitalization period
(1) The borrowing costs are not capitalized unless the following requirements are all met: 1) the asset disbursements have alreadyincurred; 2) the borrowing costs have already incurred; and 3) the acquisition and construction or production activities which arenecessary to prepare the asset for its intended use or sale have already started.
(2) Suspension of capitalization: where the acquisition and construction or production of a qualified asset is interruptedabnormally and the interruption period lasts for more than 3 months, the capitalization of the borrowing costs is suspended; theborrowing costs incurred during such period are recognized as expenses, and are included in profit or loss, till the acquisition andconstruction or production of the asset restarts.
(3) Ceasing of capitalization: when the qualified asset under acquisition and construction or production is ready for the intendeduse or sale, the capitalization of the borrowing costs is ceased.
3. Capitalization rate and capitalized amount of borrowing costs
For borrowings exclusively for the acquisition and construction or production of assets eligible for capitalization, the to-be-capitalized amount of interests is determined in light of the actual interest expenses incurred (including amortization of premium ordiscount based on effective interest method) of the special borrowings in the current period less the interest income on the unusedborrowings as a deposit in the bank or as a temporary investment; where a general borrowing is used for the acquisition and constructionor production of assets eligible for capitalization, the Company calculates and determines the to-be-capitalized amount of interests onthe general borrowing by multiplying the weighted average asset disbursement of the part of the accumulative asset disbursements lessthe general borrowing by the capitalization rate of the general borrowing used.
27、Productive biological assets
28、Oil & gas assets
29、Right-of-use assets
1. Recognition principles of right-of-use asset
Right-of-use asset refers to the asset that represents the Company’s right as lessee to use an underlying asset for the lease term.The Company recognizes a right-of-use asset at the commencement date. Right-of-use assets are recognized only when: (a) it isprobable that the economic benefits will flow to the Company; and (b) the cost of the right-of-use asset can be measured reliably.
2. Initial measurement of the right-of-use asset
The right-of-use asset is measured at cost and the cost shall comprise: (1) the amount of the initial measurement of the leaseliability; (2) any lease payments made at or before the commencement date, less any lease incentives received; (3) any initial directcosts incurred by the lessee; and (4) an estimate of costs to be incurred by the lessee in dismantling and removing the underlying asset,restoring the site on which it is located or restoring the underlying asset to the condition required by the terms and conditions of thelease.
3. Subsequent measurement of the right-of-use asset
(1) After the commencement date, the Company measures the right-of-use asset applying a cost model.
(2) The Company shall depreciate the right-of-use asset. If it is reasonable to be certain that the ownership of the underlying assetcan be acquired by the end of the lease term, the Company depreciates the right-of-use asset from the commencement date to the end
of the useful life of the underlying asset. Otherwise, the Company depreciates the right-of-use asset from the commencement date tothe earlier of the end of the useful life of the right-of-use asset or the end of the lease term. Depreciation method of different categoriesof right-of-use assets are as follows:
| Categories | Depreciation method | Useful life (years) | Residual value proportion (%) | Annual depreciation rate (%) |
| Buildings and structures | Straight-line method | 5-11 | 0 | 9.09-20.00 |
| General equipment | Straight-line method | 3-5 | 0 | 20.00-33.33 |
| Special equipment | Straight-line method | 3-15 | 0 | 6.67-33.33 |
| Transport facilities | Straight-line method | 3-5 | 0 | 20.00-33.33 |
| Items | Amortization period (years) |
| Land use right | 50、30 |
| Patent right | 10 |
| Trademark right | 10 |
| Propitiatory technology | 5 |
| Management software | 3-10 |
| Sewage disposal right | 10 |
（2）Accounting policy of expenditures on the research phase of an internal projectExpenditures on the research phase of an internal project are recognized as profit or loss when they are incurred. An intangibleasset arising from the development phase of an internal project is recognized if the Company can demonstrate all of the followings: (1)the technical feasibility of completing the intangible asset so that it will be available for use or sale; (2) its intention to complete theintangible asset and use or sell it; (3) how the intangible asset will generate probable future economic benefits, among other things, theCompany can demonstrate the existence of a market for the output of the intangible asset or the intangible asset itself or, if it is to beused internally, the usefulness of the intangible asset; (4) the availability of adequate technical, financial and other resources to completethe development and to use or sell the intangible asset; and (5) its ability to measure reliably the expenditure attributable to the intangibleasset during its development.
31、Impairment of part of long-term assets
For long-term assets such as long-term equity investments, investment property at cost model, fixed assets, construction inprogress, right-of-use assets, intangible assets with finite useful lives, etc., if at the balance sheet date there is indication of impairment,the recoverable amount is to be estimated. For goodwill recognized in business combination and intangible assets with indefinite usefullives, no matter whether there is indication of impairment, impairment test is performed annually. Impairment test on goodwill isperformed on related asset group or asset group portfolio.When the recoverable amount of such long-term assets is lower than their carrying amount, the difference is recognized asprovision for assets impairment through profit or loss.
32、Long-term prepayments
Long-term prepayments are expenses that have been recognized but with amortization period over one year (excluding one year).They are recorded with actual cost, and evenly amortized within the beneficiary period or stipulated period. If items of long-termprepayments fail to be beneficial to the following accounting periods, residual values of such items are included in profit or loss.
33、Contract liabilities
The Company presents contract assets or contract liabilities in the balance sheet based on the relationship between its performanceobligations and customers’ payments. Contract assets and contract liabilities under the same contract shall offset each other and bepresented on a net basis.
The Company presents an obligation to transfer goods to a customer for which the Company has received consideration (or theamount is due) from the customer as a contract liability.
34、Employee benefits
（1）Accounting treatment for short-term employee benefits
The Company recognizes, in the accounting period in which an employee provides service, short-term employee benefits actuallyincurred as liabilities, with a corresponding charge to profit or loss or the cost of a relevant asset.
（2）Accounting treatment for post-employment benefits
The Company classifies post-employment benefit plans as either defined contribution plans or defined benefit plans.
(1) The Company recognizes in the accounting period in which an employee provides service the contribution payable to adefined contribution plan as a liability, with a corresponding charge to profit or loss or the cost of a relevant asset.
(2) Accounting treatment by the Company for defined benefit plan usually involves the following steps:
1) In accordance with the projected unit credit method, using unbiased and mutually compatible actuarial assumptions to estimaterelated demographic variables and financial variables, measure the obligations under the defined benefit plan, and determine the periodsto which the obligations are attributed. Meanwhile, the Company discounts obligations under the defined benefit plan to determine thepresent value of the defined benefit plan obligations and the current service cost;
2) When a defined benefit plan has assets, the Company recognizes the deficit or surplus by deducting the fair value of definedbenefit plan assets from the present value of the defined benefit plan obligation as a net defined benefit plan liability or net definedbenefit plan asset. When a defined benefit plan has a surplus, the Company measures the net defined benefit plan asset at the lower ofthe surplus in the defined benefit plan and the asset ceiling;
3) At the end of the period, the Company recognizes the following components of employee benefits cost arising from definedbenefit plan: a. service cost; b. net interest on the net defined benefit plan liability (asset); and c. changes as a result of remeasurementof the net defined benefit liability (asset). Item a and item b are recognized in profit or loss or the cost of a relevant asset. Item c isrecognized in other comprehensive income and is not to be reclassified subsequently to profit or loss. However, the Company maytransfer those amounts recognized in other comprehensive income within equity.
（3）Accounting treatment for termination benefits
Termination benefits provided to employees are recognized as an employee benefit liability for termination benefits, with acorresponding charge to profit or loss at the earlier of the following dates: (1). when the Company cannot unilaterally withdraw theoffer of termination benefits because of an employment termination plan or a curtailment proposal; or (2). when the Companyrecognizes cost or expenses related to a restructuring that involves the payment of termination benefits.
（4）Accounting treatment for Other long-term employee benefits
When other long-term employee benefits provided to the employees satisfied the conditions for classifying as a definedcontribution plan, those benefits are accounted for in accordance with the requirements relating to defined contribution plan, whileother benefits are accounted for in accordance with the requirements relating to defined benefit plan. The Company recognizes the costof employee benefits arising from other long-term employee benefits as the followings: a. service cost; b. net interest on the net liabilityor net assets of other long-term employee benefits; and c. changes as a result of remeasurement of the net liability or net assets of otherlong-term employee benefits. As a practical expedient, the net total of the aforesaid amounts is recognized in profit or loss or includedin the cost of a relevant asset.
35、Lease liabilities
36、Provisions
1. Provisions are recognized when fulfilling the present obligations arising from contingencies such as providing guarantee forother parties, litigation, products quality guarantee, onerous contract, etc., may cause the outflow of the economic benefit and suchobligations can be reliably measured.
2. The initial measurement of provisions is based on the best estimated expenditures required in fulfilling the present obligations,and its carrying amount is reviewed at the balance sheet date.
37、Share-based payment
1. Types of share-based payment
Share-based payment consists of equity-settled share-based payment and cash-settled share-based payment.
2. Accounting treatment for settlements, modifications and cancellations of share-based payment plans
(1) Equity-settled share-based payment
For equity-settled share-based payment transaction with employees, if the equity instruments granted vest immediately, the fairvalue of those equity instruments is measured at grant date and recognized as transaction cost or expense, with a correspondingadjustment in capital reserve; if the equity instruments granted do not vest until the counterparty completes a specified period of service,at the balance sheet date within the vesting period, the fair value of those equity instruments measured at grant date based on the bestestimate of the number of equity instruments expected to vest is recognized as transaction cost or expense, with a correspondingadjustment in capital reserve.
For equity-settled share-based payment transaction with parties other than employees, if the fair value of the services receivedcan be measured reliably, the fair value is measured at the date the Company receives the service; if the fair value of the servicesreceived cannot be measured reliably, but that of equity instruments can be measured reliably, the fair value of the equity instrumentsgranted measured at the date the Company receives the service is referred to, and recognized as transaction cost or expense, with acorresponding increase in equity.
(2) Cash-settled share-based payment
For cash-settled share-based payment transactions with employees, if share appreciation rights vest immediately, the fair valueof the liability incurred as the acquisition of services is measured at grant date and recognized as transaction cost or expense, with acorresponding increase in liabilities; if share appreciation rights do not vest until the employees have completed a specified period ofservice, the liability is measured, at each balance sheet date until settled, at the fair value of the share appreciation rights measured atgrant date based on the best estimate of the number of share appreciation right expected to vest.
(3) Modifications and cancellations of share-based payment plan
If the modification increases the fair value of the equity instruments granted, the Company includes the incremental fair valuegranted in the measurement of the amount recognized for services received as consideration for the equity instruments granted; similarly,if the modification increases the number of equity instruments granted, the Company includes the fair value of the additional equityinstruments granted, in the measurement of the amount recognized for services received as consideration for the equity instrumentsgranted; if the Company modifies the vesting conditions in a manner that is beneficial to the employee, the Company takes the modifiedvesting conditions into account.
If the modification reduces the fair value of the equity instruments granted, the Company does not take into account that decreasein fair value and continue to measure the amount recognized for services received as consideration for the equity instruments based onthe grant date fair value of the equity instruments granted; if the modification reduces the number of equity instruments granted to anemployee, that reduction is accounted for as a cancellation of that portion of the grant; if the Company modifies the vesting conditionsin a manner that is not beneficial to the employee, the Company does not take the modified vesting conditions into account.
If the Company cancels or settles a grant of equity instruments during the vesting period (other than that cancelled when thevesting conditions are not satisfied), the Company accounts for the cancellation or settlement as an acceleration of vesting, and thereforerecognizes immediately the amount that otherwise would have been recognized for services received over the remainder of the vestingperiod.
38、Other financial instruments such as preferred shares, perpetual bonds
39、Revenue
Revenue recognition and measurement principle
1. Revenue recognition principles
At contract inception, the Company shall assess the contracts and shall identify each performance obligation in the contracts, anddetermine whether the performance obligation should be satisfied over time or at a point in time.
The Company satisfies a performance obligation over time if one of the following criteria are met, otherwise, the performanceobligation is satisfied at a point in time: (1) the customer simultaneously receives and consumes the economic benefits provided bythe Company’s performance as the Company performs; (2) the customer can control goods as they are created by the Company’sperformance; (3) goods created during the Company’s performance have irreplaceable uses and the Company has an enforceableright to the payments for performance completed to date during the whole contract period.
For each performance obligation satisfied over time, the Company shall recognize revenue over time by measuring the progresstowards complete satisfaction of that performance obligation. In the circumstance that the progress cannot be measured reasonably,but the costs incurred in satisfying the performance obligation are expected to be recovered, the Company shall recognize revenueonly to the extent of the costs incurred until it can reasonably measure the progress. For each performance obligation satisfied at apoint in time, the Company shall recognize revenue at the time point that the client obtains control of relevant goods or services. Todetermine whether the customer has obtained control of goods, the Company shall consider the following indications: (1) theCompany has a present right to payment for the goods, i.e., the customer is presently obliged to pay for the goods; (2) the Companyhas transferred the legal title of the goods to the customer, i.e., the customer has legal title to the goods; (3) the Company hastransferred physical possession of the goods to the client, i.e., the customer has physically possessed the goods; (4) the Company hastransferred significant risks and rewards of ownership of the goods to the client, i.e., the customer has obtained significant risks andrewards of ownership of the goods; (5) the customer has accepted the goods; (6) other evidence indicating the customer has obtainedcontrol over the goods.
2. Revenue measurement principle
(1) Revenue is measured at the amount of the transaction price that is allocated to each performance obligation. The transactionprice is the amount of consideration to which the Company expects to be entitled in exchange for transferring goods or services to acustomer, excluding amounts collected on behalf of third parties and those expected to be refunded to the customer.
(2) If the consideration promised in a contract includes a variable amount, the Company shall confirm the best estimate of variableconsideration at expected value or the most likely amount. However, the transaction price that includes the amount of variableconsideration only to the extent that it is high probable that a significant reversal in the amount of cumulative revenue recognized willnot occur when the uncertainty associated with the variable consideration is subsequently resolved.
(3) In the circumstance that the contract contains a significant financing component, the Company shall determine the transactionprice based on the price that a customer would have paid for if the customer had paid cash for obtaining control over those goods orservices. The difference between the transaction price and the amount of promised consideration is amortized under effective interestmethod over contractual period. The effects of a significant financing component shall not be considered if the Company expects, atthe contract inception, that the period between when the customer obtains control over goods or services and when the customer paysconsideration will be one year or less.
(4) For contracts containing two or more performance obligations, the Company shall determine the stand-alone selling price atcontract inception of the distinct good underlying each performance obligation and allocate the transaction price to each performanceobligation on a relative stand-alone selling price basis.
3. Revenue recognition method
The Company’s sales of hand tools and power tools, laser measurement, storage and PPE are performance obligations satisfiedat a point in time. Revenue from domestic sales is recognized when the Company has delivered goods to the designated address asagreed by contract and such delivered goods have been verified for acceptance by customers, and the Company has collected thepayments or has obtained the right to the payments, and related economic benefits are highly probable to flow to the Company. Revenuefrom overseas sales is recognized when the Company has declared goods to the customs based on contractual agreements and hasobtained a bill of lading, and the Company has collected the payments or has obtained the right to the payments, and related economicbenefits are highly probable to flow to the Company.Revenue recognition principles’ differences may occur in the similar business but different operating models.40、Government grants
1. Government grants shall be recognized if, and only if, the following conditions are all met: (1) the Company will comply withthe conditions attaching to the grants; (2) the grants will be received. Monetary government grants are measured at the amount received
or receivable. Non-monetary government grants are measured at fair value, and can be measured at nominal amount in the circumstancethat fair value cannot be assessed.
2. Government grants related to assets
Government grants related to assets are government grants with which the Company constructs or otherwise acquires long-termassets under requirements of government. In the circumstances that there is no specific government requirement, the Company shalldetermine based on the primary condition to acquire the grants, and government grants related to assets are government grants whoseprimary condition is to construct or otherwise acquire long-term assets. They offset carrying amount of relevant assets, or they arerecognized as deferred income. If recognized as deferred income, they are included in profit or loss on a reasonable and systematicbasis over the useful lives of the relevant assets. Those measured at notional amount are directly included into profit or loss. For assetssold, transferred, disposed or damaged within the useful lives, balance of unamortized deferred income is transferred into profit or lossof the period in which the disposal occurred.
3. Government grants related to income
Government grants related to income are government grants other than those related to assets. For government grants that containboth parts related to assets and parts related to income, in which those two parts are blurred, they are thus collectively classified asgovernment grants related to income. For government grants related to income used for compensating the related future cost, expensesor losses, they are recognized as deferred income and included in profit or loss or used to offset relevant cost during the period in whichthe relevant cost, expenses or losses are recognized; for government grants related to income used for compensating the related cost,expenses or losses incurred to the Company, they are directly included in profit or loss or used to offset relevant cos
4. Government grants related to the ordinary course of business shall be included into other income or used to offset relevant costbased on business nature, while those not related to the ordinary course of business shall be included into non-operating revenue orexpenditures.
41、Deferred tax assets/Deferred tax liabilities
1. Deferred tax assets or deferred tax liabilities are calculated and recognized based on the difference between the carrying amountand tax base of assets and liabilities (and the difference of the carrying amount and tax base of items not recognized as assets andliabilities but with their tax base being able to be determined according to tax laws) and in accordance with the tax rate applicable tothe period during which the assets are expected to be recovered or the liabilities are expected to be settled.
2. A deferred tax asset is recognized to the extent of the amount of the taxable income, which it is most likely to obtain and whichcan be deducted from the deductible temporary difference. At the balance sheet date, if there is any exact evidence that it is probable
that future taxable income will be available against which deductible temporary differences can be utilized, the deferred tax assetsunrecognized in prior periods are recognized.
3. At the balance sheet date, the carrying amount of deferred tax assets is reviewed. The carrying amount of a deferred tax assetis reduced to the extent that it is no longer probable that sufficient taxable income will be available to allow the benefit of the deferredtax asset to be utilized. Such reduction is subsequently reversed to the extent that it becomes probable that sufficient taxable incomewill be available.
4. The income tax and deferred tax for the period are treated as income tax expenses or income through profit or loss, excludingthose arising from the following circumstances: (a) business combination; and (b) the transactions or items directly recognized in equity.
42、Leases
（1）Accounting treatment for operating lease
When the Company is the lessee, lease payments are recognized as cost or profit or loss with straight-line method over the leaseterm. Initial expenses are recognized directly into profit or loss. Contingent rents are charged as profit or loss in the periods in whichthey are incurred.When the Company is the lessor, lease income is recognized as profit or loss with straight-line method over the lease term. Initialexpenses, other than those with material amount and eligible for capitalization which are recognized as profit or loss by installments,are recognized directly as profit or loss. Contingent rents are charged as profit or loss in the periods in which they are incurred.Notes: it is applicable to other companies apart from Lista Holding AG and its subsidiaries
（2）Accounting treatment for finance lease
When the Company is the lessee, at the commencement of the lease term, lessees recognize finance leases as assets and liabilitiesin their balance sheets at amounts equal to the lower of fair value of the leased property and the present value of the minimum leasepayments, each determined at the inception of the lease, and recognize the minimum lease payments as the entering value of long-termpayable, and treat the difference of the two as unrecognized finance expense. Any initial direct costs of the lessee are added to theamount recognized as an asset. The effective interest method is used to recognize finance expense of the period during the lease term.
When the Company is the lessor, at the commencement of the lease, lessor recognizes the aggregate of minimum lease receiptsand initial direct costs, each determined at the inception of the lease, as the entering value of finance lease receivables, and recognizethe unguaranteed residual value at the same time. The difference between the aggregate of the minimum lease receipts, the initial direct
costs and the unguaranteed residual value, and the sum of their present values is recognized as unrealized finance income. The effectiveinterest method is used to recognize finance income of the period during the lease term.Notes: it is applicable to other companies apart from Lista Holding AG and its subsidiaries
（3） Lista Holding AG and its subsidiaries
Lista Holding AG and its subsidiaries adopt IFRS to prepare financial statements and have implemented IFRS 16 Lease. Detailsof accounting policies on leases of Lista Holding AG and its subsidiaries are as follows:
(1) Identification of a lease
At inception of a contract, the entity assesses whether the contract is, or contains, a lease. A contract is, or contains, a lease if thecontract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To assess whethera contract conveys the right to control the use of an identified asset for a period of time, the entity assesses whether, throughout theperiod of use, the customer has both the rights to obtain substantially all of the economic benefits from use of the identified asset andto direct the use of the identified asset.
(2) Identification of separate leases
For a contract that contains more than one lease component, the entity separates the components and accounts for each leasecomponent separately. The right to use an underlying asset is a separate lease component if both: a) the lessee can benefit from use ofthe underlying asset either on its own or together with other resources that are readily available to the lessee; and b) the underlyingasset is neither highly dependent on, nor highly interrelated with, the other underlying assets in the contract.
(3) The entity as the lessee
At the commencement date, the entity recognizes a lease that has a lease term of 12 months or less as a short-term lease, whichshall not contain a purchase option; the entity recognizes a lease as a lease of a low-value asset if the underlying asset is lower thanCHF 10,000.00 when it is new. If the entity subleases an asset, or expects to sublease an asset, the head lease does not qualify as a leaseof a low-value asset.
For all short-term leases and leases of low-value assets, lease payments are recognized as cost or profit or loss with straight-linemethod over the lease term.
Apart from the above-mentioned short-term leases and leases of low-value assets with simplified approach, the entity recognizesright-of-use assets and lease liabilities at the commencement date.
At the commencement date, the entity measures the lease liability at the present value of the lease payments that are not paid atthat date, discounted using the interest rate implicit in the lease. If that rate cannot be readily determined, the entity’s incremental
borrowing rate shall be used. Unrecognized financing expenses, calculated at the difference between the lease payment and its presentvalue, are recognized as interest expenses over the lease term using the discount rate which has been used to determine the presentvalue of lease payment and included in profit or loss. Variable lease payments not included in the measurement of lease liabilities areincluded in profit or loss in the periods in which they are incurred.After the commencement date, if there is a change in the following items: (a) actual fixed payments; (b) amounts expected to bepayable under residual value guarantees; (c) an index or a rate used to determine lease payments; (d) assessment result or exercise ofpurchase option, extension option or termination option., the entity remeasures the lease liability based on the present value of leasepayments after changes.
(4) The entity as the lessor
At the commencement date, the entity classifies a lease as a finance lease if it transfers substantially all the risks and rewardsincidental to ownership of an underlying asset. Otherwise, it is classified as an operating lease.1）Operating leaseLease receipts are recognized as lease income with straight-line method over the lease term. Initial direct costs incurred shall becapitalized, amortized on the same basis as the recognition of lease income, and included into profit or loss by installments. Variablelease payments related to operating lease which are not included in the lease payment are charged as profit or loss in the periods inwhich they are incurred.If an operating lease is changed, the entity will treat it as a new lease for accounting treatment from the effective date of the change,and the amount of advance receipts or lease receivables related to the lease before the change shall be regarded as the amount of thenew lease.
2) Finance lease
At the commencement date, the entity recognizes the finance lease payment receivable based on the net investment in the lease(sum of the present value of unguaranteed residual value and lease receipts that are not received at the commencement date, discountedby the interest rate implicit in the lease), and derecognizes assets held under the finance lease. The entity calculates and recognizesinterest income using the interest rate implicit in the lease over the lease term.
Variable lease payments not included in the measurement of the net investment in the lease are charged as profit or loss in theperiods in which they are incurred.
(5) Lease modification
a. A lease modification as a separate lease
The entity accounts for a lease modification as a separate lease if both: (a) the modification increases the scope of the lease byadding the right to use one or more underlying assets; and (b) the consideration for the lease increases by an amount commensurate
with the stand-alone price for the increase in scope.b. A lease modification not as a separate lease
1) The entity as the lessee
At the effective date of the lease modification, the entity redetermines the lease term of the modified lease and remeasures thelease liability by discounting the revised lease payment using a revised discount rate. The revised discount rate is determined as theinterest rate implicit in the lease for the remainder of the lease term; if the interest rate implicit in the lease cannot be readily determined,the revised discount rate is determined as the entity’s incremental borrowing rate at the effective date of the modification.The entity accounts for the remeasurement of the lease liability by:
a. decreasing the carrying amount of the right-of-use asset to reflect the partial or full termination of the lease for leasemodifications that decrease the scope of the lease. The entity recognizes in profit or loss any gain or loss relating to the partial or fulltermination of the lease.
b. making a corresponding adjustment to carrying amount of the right-of-use asset for all other lease modifications.
2) The entity as the lessor
If the lease would have been classified as an operating lease had the modification been in effect at the inception date, the entityaccounts for the lease modification as a new lease from the effective date of the modification, and measures the carrying amount of theunderlying asset as the net investment in the lease immediately before the effective date of the lease modification. Otherwise, the entityapplies regulations in the “CASBE 22 – Financial Instruments: Recognition and Measurement” regarding the modification orrenegotiation of contracts.
43、Other significant accounting policies and estimates
44、Significant changes in accounting policies and estimates
（1）Significant changes in accounting policies
√ applicable □not applicable
| content and reason for changes in accounting policies | Approval procedure | Notes |
| Items | Balance sheet | ||
| Dec. 31, 2019 | Effect due to revised standard | Jan. 1, 2020 | |
| Advances received | 56,674,240.40 | -56,674,240.40 | |
| Contract liabilities | 56,674,240.40 | 56,674,240.40 |
| Items | Dec. 31, 2019 | Jan. 1, 2020 | Adjustments |
| Current assets: | |||
| Cash and bank balances | 2,456,926,805.33 | 2,456,926,805.33 | |
| Settlement funds | |||
| Loans to other banks | |||
| Held-for-trading financial assets | 71,998,431.87 | 71,998,431.87 | |
| Derivative financial assets | |||
| Notes receivable | 3,691,476.43 | 3,691,476.43 | |
| Accounts receivable | 1,107,232,500.18 | 1,107,232,500.18 | |
| Receivables financing | 103,629,298.04 | 103,629,298.04 | |
| Prepaid expenses | 44,207,270.43 | 44,207,270.43 | |
| Premiums receivable | |||
| Reinsurance accounts receivable | |||
| Reinsurance reserve |
| receivable | |||
| Other receivables | 32,597,234.91 | 32,597,234.91 | |
| Including: interest receivable | |||
| dividends receivable | |||
| Financial assets under reverse repo | |||
| Inventories | 1,193,884,981.91 | 1,193,884,981.91 | |
| Contract assets | |||
| Assets classified as held for sale | |||
| Non-current assets due within one year | 2,279,390.88 | 2,279,390.88 | |
| Other current assets | 127,977,910.59 | 127,977,910.59 | |
| Total current assets | 5,144,425,300.57 | 5,144,425,300.57 | |
| Non-current assets: | |||
| Loans and advances paid | |||
| Debt investments | |||
| Other debt investments | |||
| Long-term receivables | 19,123,250.45 | 19,123,250.45 | |
| Long-term equity investments | 1,931,344,951.25 | 1,931,344,951.25 | |
| Other equity instrument investments | 192,550,000.00 | 192,550,000.00 | |
| Other non-current financial assets | 569,209.09 | 569,209.09 | |
| Investment property | |||
| Fixed assets | 1,058,454,179.69 | 1,058,454,179.69 | |
| Construction in progress | 129,158,811.57 | 129,158,811.57 | |
| Productive biological assets | |||
| Oil & gas assets | |||
| Right-of-use assets | 208,773,189.40 | 208,773,189.40 | |
| Intangible assets | 507,806,230.99 | 507,806,230.99 | |
| Development |
| expenditures | |||
| Goodwill | 1,873,718,797.75 | 1,873,718,797.75 | |
| Long-term prepayments | 6,024,753.26 | 6,024,753.26 | |
| Deferred tax assets | 27,134,708.74 | 27,134,708.74 | |
| Other non-current assets | 33,415,400.66 | 33,415,400.66 | |
| Total non-current assets | 5,988,073,482.85 | 5,988,073,482.85 | |
| Total assets | 11,132,498,783.42 | 11,132,498,783.42 | |
| Current liabilities: | |||
| Short-term borrowings | 823,460,644.57 | 823,460,644.57 | |
| Central bank loans | |||
| Loans from other banks | |||
| Held-for-trading financial liabilities | 4,901,459.62 | 4,901,459.62 | |
| Derivative financial liabilities | |||
| Notes payable | 309,180,000.00 | 309,180,000.00 | |
| Accounts payable | 893,633,852.13 | 893,633,852.13 | |
| Advances received | 56,674,240.40 | -56,674,240.40 | |
| Contract liabilities | 56,674,240.40 | 56,674,240.40 | |
| Financial liabilities under repo | |||
| Absorbing deposit and interbank deposit | |||
| Deposit for agency security transaction | |||
| Deposit for agency security underwriting | |||
| Employee benefits payable | 151,171,243.00 | 151,171,243.00 | |
| Taxes and rates payable | 82,866,611.51 | 82,866,611.51 | |
| Other payables | 12,600,147.87 | 12,600,147.87 | |
| Including: interest payable | |||
| dividends payable | |||
| Handling fee and commission payable |
| Reinsurance accounts payable | |||
| Liabilities classified as held for sale | |||
| Non-current liabilities due within one year | 181,542,647.04 | 181,542,647.04 | |
| Other current liabilities | |||
| Total current liabilities | 2,516,030,846.14 | 2,516,030,846.14 | |
| Non-current liabilities: | |||
| Insurance policy reserve | |||
| Long-term borrowings | 689,385,008.46 | 689,385,008.46 | |
| Bonds payable | |||
| Including: Preferred shares | |||
| Perpetual bonds | |||
| Lease liabilities | 198,134,622.40 | 198,134,622.40 | |
| Long-term payables | 2,475,860.36 | 2,475,860.36 | |
| Long-term employee benefits payable | 39,397,630.54 | 39,397,630.54 | |
| Provisions | 5,704,617.60 | 5,704,617.60 | |
| Deferred income | 5,189,661.19 | 5,189,661.19 | |
| Deferred tax liabilities | 59,746,738.53 | 59,746,738.53 | |
| Other non-current liabilities | |||
| Total non-current liabilities | 1,000,034,139.08 | 1,000,034,139.08 | |
| Total liabilities | 3,516,064,985.22 | 3,516,064,985.22 | |
| Equity: | |||
| Share capital | 1,075,247,700.00 | 1,075,247,700.00 | |
| Other equity instruments | |||
| Including: Preferred shares | |||
| Perpetual bonds | |||
| Capital reserve | 2,036,394,272.83 | 2,036,394,272.83 | |
| Less: Treasury shares | 105,492,690.23 | 105,492,690.23 |
| Other comprehensive income | 145,005,399.56 | 145,005,399.56 | |
| Special reserve | |||
| Surplus reserve | 429,856,864.70 | 429,856,864.70 | |
| General risk reserve | |||
| Undistributed profit | 3,849,578,318.39 | 3,849,578,318.39 | |
| Total equity attributable to the parent company | 7,430,589,865.25 | 7,430,589,865.25 | |
| Non-controlling interest | 185,843,932.95 | 185,843,932.95 | |
| Total equity | 7,616,433,798.20 | 7,616,433,798.20 | |
| Total liabilities & equity | 11,132,498,783.42 | 11,132,498,783.42 |
| Items | Dec. 31, 2019 | Jan. 1, 2020 | Adjustments |
| Current assets: | |||
| Cash and bank balances | 1,472,525,772.95 | 1,472,525,772.95 | |
| Held-for-trading financial assets | 7,033,099.93 | 7,033,099.93 | |
| Derivative financial assets | |||
| Notes receivable | 3,691,476.43 | 3,691,476.43 | |
| Accounts receivable | 948,196,301.97 | 948,196,301.97 | |
| Receivables financing | 97,648,181.92 | 97,648,181.92 | |
| Prepaid expenses | 15,153,995.43 | 15,153,995.43 | |
| Other receivables | 666,322,858.19 | 666,322,858.19 | |
| Including: Interest receivable | |||
| Dividends receivable | |||
| Inventories | 49,868,368.75 | 49,868,368.75 | |
| Contract assets | |||
| Assets classified as held for sale | |||
| Non-current assets due within one year |
| Other current assets | 56,483,305.15 | 56,483,305.15 | |
| Total current assets | 3,316,923,360.72 | 3,316,923,360.72 | |
| Non-current assets: | |||
| Debt investments | |||
| Other debt investments | |||
| Long-term receivables | |||
| Long-term equity investments | 4,643,499,980.57 | 4,643,499,980.57 | |
| Other equity instrument investments | 192,550,000.00 | 192,550,000.00 | |
| Other non-current financial assets | |||
| Investment property | |||
| Fixed assets | 156,195,102.79 | 156,195,102.79 | |
| Construction in progress | 1,949,216.31 | 1,949,216.31 | |
| Productive biological assets | |||
| Oil & gas assets | |||
| Right-of-use assets | |||
| Intangible assets | 20,662,730.86 | 20,662,730.86 | |
| Development expenditures | |||
| Goodwill | |||
| Long-term prepayments | |||
| Deferred tax assets | 11,825,974.87 | 11,825,974.87 | |
| Other non-current assets | 6,189,776.24 | 6,189,776.24 | |
| Total non-current assets | 5,032,872,781.64 | 5,032,872,781.64 | |
| Total assets | 8,349,796,142.36 | 8,349,796,142.36 | |
| Current liabilities: | |||
| Short-term borrowings | 811,442,302.07 | 811,442,302.07 | |
| Held-for-trading financial liabilities | 4,901,459.62 | 4,901,459.62 | |
| Derivative financial liabilities | |||
| Notes payable | 300,000,000.00 | 300,000,000.00 | |
| Accounts payable | 511,205,844.52 | 511,205,844.52 |
| Advances received | 34,610,450.57 | -34,610,450.57 | |
| Contract liabilities | 34,610,450.57 | 34,610,450.57 | |
| Employee benefits payable | 37,398,109.40 | 37,398,109.40 | |
| Taxes and rates payable | 31,676,274.40 | 31,676,274.40 | |
| Other payables | 19,266,579.31 | 19,266,579.31 | |
| Including: interest payable | |||
| dividends payable | |||
| Liabilities classified as held for sale | |||
| Non-current liabilities due within one year | 73,585,483.85 | 73,585,483.85 | |
| Other current liabilities | |||
| Total current liabilities | 1,824,086,503.74 | 1,824,086,503.74 | |
| Non-current liabilities: | |||
| Long-term borrowings | 294,422,006.68 | 294,422,006.68 | |
| Bonds payable | |||
| Including: Preferred shares | |||
| Perpetual bonds | |||
| Lease liabilities | |||
| Long-term payables | |||
| Long-term employee benefits payable | |||
| Provisions | |||
| Deferred income | 3,197,295.96 | 3,197,295.96 | |
| Deferred tax liabilities | 12,627,681.09 | 12,627,681.09 | |
| Other non-current liabilities | |||
| Total non-current liabilities | 310,246,983.73 | 310,246,983.73 | |
| Total liabilities | 2,134,333,487.47 | 2,134,333,487.47 | |
| Equity: | |||
| Share capital | 1,075,247,700.00 | 1,075,247,700.00 |
| Other equity instruments | |||
| Including: Preferred shares | |||
| Perpetual bonds | |||
| Capital reserve | 2,042,882,286.04 | 2,042,882,286.04 | |
| Less: Treasury shares | 105,492,690.23 | 105,492,690.23 | |
| Other comprehensive income | 43,484,350.56 | 43,484,350.56 | |
| Special reserve | |||
| Surplus reserve | 426,108,567.79 | 426,108,567.79 | |
| Undistributed profit | 2,733,232,440.73 | 2,733,232,440.73 | |
| Total equity | 6,215,462,654.89 | 6,215,462,654.89 | |
| Total liabilities & equity | 8,349,796,142.36 | 8,349,796,142.36 |
| Taxes | Tax bases | Tax rates |
| Value-added tax (VAT) | The output tax calculated based on the revenue from sales of goods or rendering of services in accordance with the tax law, net of the input tax that is allowed to be deducted in the current period, the difference shall be the value-added tax payable | 13% |
| Urban maintenance and construction tax | Turnover tax actually paid | 7%、5% |
| Enterprise income tax | Taxable income | 33.33%、32.45%、27.90%、25.16%、25%、21%、20%、19%、16.5%、15%、13.66% |
| Housing property tax | For housing property levied on the basis of price, housing property tax is levied at the rate of 1.2% of | 1.2%、12% |
| the balance after deducting 30% of the cost; for housing property levied on the basis of rent, housing property tax is levied at the rate of 12% of rent revenue. | ||
| Education surcharge | Turnover tax actually paid | 3% |
| Local education surcharge | Turnover tax actually paid | 2% |
| Taxpayers | Income tax rate |
| The Company | 15% |
| Hong Kong Great Star International Co., Ltd. | 16.5% |
| Prim' Tools Limited | 16.5% |
| HongKong Goldblatt Industrial Co.,Ltd | 16.5% |
| Eudura Holding Limited | 16.5% |
| 香港国际华达科捷光电仪器有限公司 (Hong Kong International Huada Kejie Opto-Electro Instrument Co., Ltd. ) | 16.5% |
| Changzhou Huada Kejie Opto-electro Instrument Co., Ltd. | 15% |
| Hangzhou United Electric Manufacture Co., Ltd. | 15% |
| 东莞欧达电子有限公司 (Dongguan Ouda Electronics Ltd.) | 15% |
| 杭州巨星智能科技有限公司 (Hangzhou GreatStar Intelligent Technology Co., Ltd.) | 15% |
| Hangzhou United Tools Co., Ltd. | 15% |
| 杭州联盛量具制造有限公司 (Hangzhou United Precision Tool Company) | 15% |
| 浙江亿洋工具制造有限公司 (Zhe Jiang Yiyang Tool Manufacture Co., Ltd.) | 15% |
| 苏州市新大地五金制品有限公司 (Suzhou Xindadi Hardware Product Co., Ltd.) | 15% |
| GreatStar Europe AG | 13.66% |
| Prexiso AG | 13.66% |
| Lista Holding AG | 13.66% |
| Lista AG | 13.66% |
| Thur Metall AG | 13.66% |
| Lista (UK) Ltd. | 19.00% |
| Lista GmbH | 32.45% |
| Lista Italia s.r.l. | 27.90% |
| Lista France S.A. | 33.33% |
| Huni Italiana Spa | 27.90% |
| Lista Austria GmbH, Vienna, Austria | 25% |
| Lista Sistemas de Almacenaje S.A. | 20% |
| Great Star Vietnam Co.,Ltd | 20% |
| Vietnam United Co.,Ltd | 20% |
| TGH(Cambodia)Industrial Co.,LTD | 20% |
| Newland XDD(Thailand) Co .,Ltd | 20% |
| XDD Products (USA) LLC | 21% |
| Newland.LLC | 21% |
| Great Star Tools USA,Inc | 25.16% |
| 4900 Highlands Parkway,LLC | [Note1] |
| Hangzhou Equipment Holdings, LLC | [Note1] |
| Great Star Industrial USA,LLC | [Note1] |
| Arrow Fastener Co., LLC | [Note1] |
| Prime-Line Products,LLC | [Note1] |
| Great Star Japan Co.,Ltd | [Note2] |
| GreatStar International Holdings Limited | [Note3] |
| Taxpayers other than the above-mentioned | 25% |
| [Note 1]:Note 1: According to the US Internal Revenue Code, Great Star Industrial USA, LLC, Arrow Fastener Co., LLC, Prime-Line Products, LLC, 4900 Highlands Parkway, LLC and Hangzhou Equipment Holdings, LLC are not required to declare and pay enterprise income tax as LLCs. The subject of tax liability is Great Star Tools USA, Inc. | |
| [Note 2]:Great Star Japan Co., Ltd. applies progressive tax rate to pay enterprise income tax. | |
| [Note 3]:GreatStar International Holdings Limited is a company registered in the British Virgin Islands. According to the British Virgin Islands tax system, no enterprise income tax is required. |
GR201933003334 for a valid period of 3 years (from Year 2019 to Year 2021), and the enterprise income tax is calculated and leviedat a tax rate of 15% in 2020.
2. According to the “List of the First Batch of High-tech Enterprises to be Recognized in Jiangsu Province in 2020” by theNational High-tech Enterprise Certification Management Leading Group Office, the subsidiary Changzhou Huada Kejie Opto-electroInstrument Co., Ltd. was recognized as a high-tech enterprise and obtained the “High-tech Enterprise Certificate” with the number ofGR202032002996 for a valid period of 3 years (from Year 2020 to Year 2022), and the enterprise income tax is calculated and leviedat a tax rate of 15% in 2020.
3. According to the relevant provisions of the “Administrative Measures for the Recognition of High-tech Enterprises” (Guo KeFa Huo [2016] No. 32) and the “Guidelines for the Management of High-tech Enterprise Recognition” (Guo Ke Fa Huo [2016] No.
195), the sub-subsidiary Dongguan Ouda Electronics Ltd. was recognized as a high-tech enterprise, and obtained the “High-techEnterprise Certificate” with the number of GR201844004499 for a valid period of 3 years (from Year 2018 to Year 2020), and theenterprise income tax is calculated and levied at a tax rate of 15% in 2020.
4. According to the “Response to Zhejiang Province’s 2020 High-tech Enterprise Registration” (Guo Ke Huo Zi [2020] No. 251)by the National High-tech Enterprise Certification Management Leading Group Office, the subsidiary Hangzhou GreatStar IntelligentTechnology Co., Ltd. was recognized as a high-tech enterprise, and obtained the “High-tech Enterprise Certificate” with the numberof GR202033007432 for a valid period of 3 years (from Year 2020 to Year 2022), and the enterprise income tax is calculated andlevied at a tax rate of 15% in 2020.
5. According to the “Notice on Publicizing the List of High-tech Enterprises to be Recognized in Zhejiang Province in 2018” bythe National High-tech Enterprise Certification Management Leading Group Office, the subsidiary Hangzhou United Precision ToolCompany was recognized as a high-tech enterprise, and obtained the “High-tech Enterprise Certificate” with the number ofGR201833003235 for a valid period of 3 years (from Year 2018 to Year 2020), and the enterprise income tax is calculated and leviedat a tax rate of 15% in 2020.
6. According to the relevant provisions of the “Administrative Measures for the Recognition of High-tech Enterprises” (Guo KeFa Huo [2016] No. 32) and the “Guidelines for the Management of High-tech Enterprise Recognition” (Guo Ke Fa Huo [2016] No.
195), the subsidiary Hangzhou United Tools Co., Ltd. was recognized as a high-tech enterprise, and obtained the “High-tech EnterpriseCertificate” with the number of GR201833003962 for a valid period of 3 years (from Year 2018 to Year 2020), and the enterpriseincome tax is calculated and levied at a tax rate of 15% in 2020.
7. According to the relevant provisions of the “Administrative Measures for the Recognition of High-tech Enterprises” (Guo KeFa Huo [2016] No. 32) and the “Guidelines for the Management of High-tech Enterprise Recognition” (Guo Ke Fa Huo [2016] No.
195), the subsidiary Hangzhou United Electric Manufacture Co., Ltd. was recognized as a high-tech enterprise, and obtained the “High-
tech Enterprise Certificate” with the number of GR201933005763 for a valid period of 3 years (from Year 2019 to Year 2021), and theenterprise income tax is calculated and levied at a tax rate of 15% in 2020.
8. According to the relevant provisions of the “Administrative Measures for the Recognition of High-tech Enterprises” (Guo KeFa Huo [2016] No. 32) and the “Guidelines for the Management of High-tech Enterprise Recognition” (Guo Ke Fa Huo [2016] No.
195), the sub-subsidiary Zhe Jiang Yiyang Tool Manufacture Co., Ltd. was recognized as a high-tech enterprise, and obtained the“High-tech Enterprise Certificate” with the number of GR201933001929 for a valid period of 3 years (from Year 2019 to Year 2021),and the enterprise income tax is calculated and levied at a tax rate of 15% in 2020.
9. According to the relevant provisions of the “Administrative Measures for the Recognition of High-tech Enterprises” (Guo KeFa Huo [2016] No. 32) and the “Guidelines for the Management of High-tech Enterprise Recognition” (Guo Ke Fa Huo [2016] No.
195), the subsidiary Suzhou Xindadi Hardware Product Co., Ltd. was recognized as a high-tech enterprise, and obtained the “High-tech Enterprise Certificate” with the number of GR201832000874 for a valid period of 3 years (from Year 2018 to Year 2020), and theenterprise income tax is calculated and levied at a tax rate of 15% in 2020.
10. In accordance with the “Notice on Issuing the Administrative Measures for VAT Preferential Policies for PromotingEmployment of the Disabled” by Ministry of Finance and State Taxation Administration (Cai Shui [2016] No. 52), the subsidiary 龙游沪工锻三工具有限公司 (Longyou Hugong Forging Three Tools Co., Ltd. ) arranges employment for the disabled. After filing withthe competent tax authority, it enjoys the preferential policy of limited VAT refund upon collection in 2020.
3、Others
VII. Notes to items of consolidated financial statements
1、Cash and bank balances
Currency: RMB
| Items | Closing balance | Opening balance |
| Cash on hand | 2,874,834.15 | 682,285.42 |
| Cash in bank | 3,722,569,979.24 | 2,126,269,850.32 |
| Other cash and bank balances | 25,061,255.00 | 329,974,669.59 |
| Total | 3,750,506,068.39 | 2,456,926,805.33 |
| Including: Deposited overseas | 692,993,182.89 | 473,430,042.14 |
| Restricted funds caused by mortgage, pledge or blocked, etc. | 20,242,850.31 | 329,469,357.99 |
deposited investments in amount of RMB2,154,766.92, deposit for forward foreign exchange settlement in amount of 3,295,074.50,project performance bond in amount of RMB 495,608.89, deposit for ETC in amount of RMB 30,000.00 and deposits in Alipay inamount of RMB4,818,404.69. Other cash and bank balances at the beginning of the period included deposit for bank acceptance inamount of RMB 304,626,677.30, deposited investments in amount of RMB 22,822,339.65, deposit for L/C in amount of RMB1,720,341.04, deposit for L/G in amount of RMB 300,000.00and deposit in Alipay in amount of RMB 505,311.60.
2、Held-for-trading financial assets
Currency: RMB
| Items | Closing balance | Opening balance |
| Including: | ||
| Financial assets classified as at fair value through profit or loss | 63,751,278.55 | 71,998,431.87 |
| Including: | ||
| Debt instrument investments | 27,191,411.52 | 61,208,550.94 |
| Derivative financial assets | 36,027,480.86 | 10,789,880.93 |
| Banking products | ||
| Equity instrument investments | 532,386.17 | |
| Total | 63,751,278.55 | 71,998,431.87 |
| Items | Closing balance | Opening balance |
| Items | Closing balance | Opening balance |
| Bank acceptance | 9,706,191.40 | 1,667,031.04 |
| Trade acceptance | 1,823,866.09 | 2,024,445.39 |
| Total | 11,530,057.49 | 3,691,476.43 |
| Categories | Closing balance | Opening balance | ||||
| Book balance | Provision for bad | Carrying | Book balance | Provision for bad | Carrying | |
| debts | amount | debts | amount | |
| Amount | % to total | Amount | Provision proportion (%) | Amount | % to total | Amount | Provision proportion (%) | |||
| Including: | ||||||||||
| Receivables with provision for bad debts made on a collective basis | 11,530,057.49 | 100.00% | 11,530,057.49 | 3,691,476.43 | 100.00% | 3,691,476.43 | ||||
| Including: | ||||||||||
| Bank acceptance | 9,706,191.40 | 84.18% | 9,706,191.40 | 1,667,031.04 | 45.16% | 1,667,031.04 | ||||
| Trade acceptance | 1,823,866.09 | 15.82% | 1,823,866.09 | 2,024,445.39 | 54.84% | 2,024,445.39 | ||||
| Total | 11,530,057.49 | 100.00% | 11,530,057.49 | 3,691,476.43 | 100.00% | 3,691,476.43 |
| Items | Closing balance | |||
| Book balance | Provision for bad debts | Provision proportion (%) | Provision Reason | |
| Items | Closing balance | ||
| Book balance | Provision for bad debts | Provision proportion (%) | |
| Bank acceptance portfolio | 9,706,191.40 | ||
| Trade acceptance portfolio | 1,823,866.09 | ||
| Subtotal | 11,530,057.49 | -- | |
| Items | Closing balance | ||
| Book balance | Provision for bad debts | Provision proportion (%) | |
（2）Provision , recovered or reversed of the bad debt in current period
Changes in provision for bad debts in current period
Currency: RMB
| Categories | Opening balance | Increase/Decrease | Closing balance | |||
| Provision | Reversal | Write-off | Others | |||
| Items | Closing balance of pledged |
| Items | Closing balance derecognized | Closing balance unrecognized |
| Items | Closing balance of accounts receivable transferred |
| Items | Written off amount |
| Company name | Notes receivable categorized by nature | Written off amount | Written off reason | Written off precedure | Related to related party or not |
5、Accounts receivable
（1）Details on categories
Currency: RMB
| Categories | Closing balance | Opening balance | ||||||||
| Book balance | Provision for bad debts | Carrying amount | Book balance | Provision for bad debts | Carrying amount | |||||
| Amount | % to total | Amount | Provision proportion (%) | Amount | % to total | Amount | Provision proportion (%) | |||
| Receivables with provision made on an individual basis | 700,438.56 | 0.06% | 700,438.56 | 100.00% | ||||||
| Including: | ||||||||||
| Receivables with provision made on a collective basis | 1,331,711,858.42 | 100.00% | 71,615,134.67 | 5.38% | 1,260,096,723.75 | 1,170,861,787.41 | 99.94% | 63,629,287.23 | 5.43% | 1,107,232,500.18 |
| Including: | ||||||||||
| Subtotal | 1,331,711,858.42 | 100.00% | 71,615,134.67 | 5.38% | 1,260,096,723.75 | 1,171,562,225.97 | 100.00% | 64,329,725.79 | 5.49% | 1,107,232,500.18 |
| Items | Closing balance | |||
| Book balance | Provision for bad debts | Provision proportion (%) | Provision reason | |
| Items | Closing balance | ||
| Book balance | Provision for bad debts | Provision proportion (%) | |
| Portfolio grouped with age | 1,331,711,858.42 | 71,615,134.67 | 5.38% |
| Subtotal | 1,331,711,858.42 | 71,615,134.67 | -- |
| Items | Closing balance | ||
| Book balance | Provision for bad debts | Provision proportion (%) | |
refer to the disclosure of other receivables to disclose the relevant information on the provision for bad debts:
□ applicable√ not applicable
Disclosure as account receivable aging
Currency: RMB
| Ages | Book balance |
| Within 1 year(including 1 year) | 1,309,391,102.82 |
| 1-2 years | 11,941,649.62 |
| 2-3 years | 3,471,135.71 |
| Over 3 years | 6,907,970.27 |
| 3-4 years | 1,947,057.19 |
| 4-5 years | 2,575,685.55 |
| Over 5 years | 2,385,227.53 |
| Subtotal | 1,331,711,858.42 |
| Items | Opening balance | Changes in provision for bad debts in current period | Closing balance | |||
| Provision | Reversal | Write-off | Others | |||
| provision made on an individual basis | 700,438.56 | 700,438.56 | ||||
| provision made on a collective basis | 63,629,287.23 | 10,758,871.39 | 3,439,315.60 | 666,291.65 | 71,615,134.67 | |
| Subtotal | 64,329,725.79 | 10,758,871.39 | 4,139,754.16 | 666,291.65 | 71,615,134.67 | |
| Company name | Reversal amount | Reversal Method |
| Items | Written off amount |
| Payment for goods | 4,139,754.16 |
| Company name | Account Receivable categorized by nature | Write-off amount | Write-off reason | Write-off procedure | Related party or not |
| Debtors | Closing balance of Account Receivable | %of the total closing balance | Closing balance of provision for bad debts |
| Items | Closing balance | Opening balance |
| Notes receivable | 9,291,065.95 | 5,981,116.12 |
| Accounts receivable | 368,774,999.78 | 97,648,181.92 |
| Total | 378,066,065.73 | 103,629,298.04 |
| Items | Closing balance | |||||
| Initial cost | Interest adjustment | Interest accrued | Changes in fair value | Carrying amount | Provision for impairment | |
| Notes receivable | 9,291,065.95 | 9,291,065.95 | ||||
| Including: Bank acceptance | 9,291,065.95 | 9,291,065.95 | ||||
| Accounts receivable | 388,184,210.30 | 368,774,999.78 | 19,409,210.52 | |||
| Total | 397,475,276.25 | 378,066,065.73 | 19,409,210.52 |
| Items | Opening balance | |||||
| Initial | I | I | Changes in | Carrying | Provision | |
| cost | nterest adjustment | nterest accrued | fair value | amount | for impairment | |
| Notes receivable | 5,981,116.12 | 5,981,116.12 | ||||
| Including: Bank acceptance | 5,981,116.12 | 5,981,116.12 |
| Accounts receivable | 102,787,559.92 | 97,648,181.92 | 5,139,378.00 | |||
| Total | 108,768,676.04 | 103,629,298.04 | 5,139,378.00 |
| Items | Closing balance | ||
| Book balance | Provision for impairment | Provision proportion (%) | |
| Bank acceptance portfolio | 9,291,065.95 | ||
| Accounts receivable portfolio | 388,184,210.30 | 19,409,210.52 | 5.00 |
| Subtotal | 397,475,276.25 | 19,409,210.52 | 4.88 |
| Items | Opening balance | Increase | Decrease | Closing balance | |||
| Accrual | Others | Reversal | Write-off | Others | |||
| Provision made on an individual basis | |||||||
| Provision made on a collective basis | 5,139,378.00 | 14,269,832.52 | 19,409,210.52 |
| Subtotal | 5,139,378.00 | 14,269,832.52 | 19,409,210.52 |
| Items | Closing balance derecognized |
| Bank acceptance | 5,892,372.58 |
| Subtotal | 5,892,372.58 |
| Items | Amount derecognized | Gains or losses related to derecognition | Ways of financial assets transfer |
| Payment for goods | 792,875,526.72 [Note] | Receivables financing transfer without recourse |
| Subtotal | 792,875,526.72 |
□ applicable√ not applicable
Other instructions:
7、Prepaid expenses
（1）Age analysis
Currency: RMB
| Ages | Closing balance | Opening balance | ||
| Carrying amount | % to total | Carrying amount | % to total | |
| Within 1 year | 75,669,455.91 | 94.58% | 38,807,162.56 | 87.79% |
| 1-2 years | 2,779,725.40 | 3.47% | 2,961,117.66 | 6.70% |
| 2-3 years | 1,260,526.85 | 1.58% | 606,725.31 | 1.37% |
| Over 3years | 298,672.68 | 0.37% | 1,832,264.90 | 4.14% |
| Total | 80,008,380.84 | -- | 44,207,270.43 | -- |
| Debtors | Book balance | Proportion to the total balance of Prepaid expenses (%) |
| Rico Tools Co.,Ltd | 9,134,860.00 | 10.33 |
| Old Republic National Title Insurance Company | 6,779,716.92 | 7.67 |
| 常州市科华电子有限公司 (Changzhou Kehua Electronics Co., Ltd.) | 4,459,985.06 | 5.04 |
| Thanh Phone Production And Trade Limited Company | 3,526,389.58 | 3.99 |
| 常州摩美电子科技有限公司(Changzhou Momei Electronic Technology Co., Ltd.) | 1,197,332.00 | 1.35 |
| Subtotal | 25,098,283.56 | 28.38 |
| Items | Closing balance | Opening balance |
| other receivables | 58,613,172.02 | 32,597,234.91 |
| Total | 58,613,172.02 | 32,597,234.91 |
| Items | Closing balance | Opening balance |
| Debtors | Closing balance | Overdue date | Overdue reason | Impaired or not and basis |
| Items(Invested entity) | Closing balance | Opening balance |
| Items(Invested entity) | Closing balance | ages | Reason for not recovered | Impaired or not and basis |
| Nature of receivables | Closing balance | Opening balance |
| Export tax rebates | 28,999,815.42 | 18,896,453.45 |
| Security deposits | 29,411,823.59 | 11,402,437.53 |
| Temporary advance payment receivable | 2,110,757.40 | 1,658,742.02 |
| Employee petty cash | 673,044.45 | 420,947.92 |
| Others | 1,721,743.22 | 4,179,990.68 |
| Total | 62,917,184.08 | 36,558,571.60 |
| Items | Phase I | Phase II | Phase III | Subtotal |
| 12?month expected credit losses | Lifetime expected credit losses (credit not impaired) | Lifetime expected credit losses (credit impaired) | ||
| Opening balance | 1,314,370.33 | 201,863.27 | 2,445,103.09 | 3,961,336.69 |
| Opening balance in the current period | —— | —— | —— | —— |
| Provision made in the current period | 3,182,196.64 | -78,994.09 | -789,810.37 | 2,313,392.18 |
| Provision written off in current period | 420,841.60 | 420,841.60 | ||
| Other changes | -1,549,875.21 | -1,549,875.21 | ||
| Closing balance | 2,946,691.76 | 122,869.18 | 1,234,451.12 | 4,304,012.06 |
| ages | Booking balance |
| Within 1 Year | 58,933,868.29 |
| 1-2years | 1,228,691.76 |
| 2-3ears | 364,970.50 |
| Over 3years | 2,389,653.53 |
| 3-4years | 261,164.76 |
| 4-5years | 2,090,762.37 |
| Over 5years | 37,726.40 |
| Subtotal | 62,917,184.08 |
3）Provision , recovered or reversed of the bad debt in current periodChanges in provision for bad debts in current period:
Currency: RMB
| Categories | Opening balance | Changes in provision for bad debts in current period | Closing balance | |||
| Provision | Reversal | Write-off | Others | |||
| Within 1 Year | 1,314,370.32 | 3,182,196.65 | -1,549,875.21 | 2,946,691.76 | ||
| 1-2years | 201,863.27 | -78,994.09 | 122,869.18 | |||
| 2-3ears | 1,060,986.73 | -987,992.63 | 72,994.10 | |||
| 3-4years | 633,164.19 | -554,814.76 | 78,349.43 | |||
| 4-5years | 99,084.50 | 946,296.69 | 1,045,381.19 | |||
| Over 5years | 651,867.68 | -193,299.68 | 420,841.60 | 37,726.40 | ||
| Subtotal | 3,961,336.69 | 2,313,392.18 | 420,841.60 | -1,549,875.21 | 4,304,012.06 | |
| Debtors | recovered or reversed amount | Way to recover |
| Items | written off amount |
| Debtors | Nature of receivables | written off amount | written off reason | written off procedure | Related party or not |
| Debtors | Nature of receivables | Closing balance | Ages | Proportion to the total balance of other receivables (%) | Provision for bad debts |
| Export tax rebates | Export tax rebates | 28,999,815.42 | Within 1 Year | 46.09% | 1,449,990.77 |
| Cong ty Co phan Shinec | Security deposits | 10,500,495.47 | Within 1 Year | 16.69% | 525,024.77 |
| Cong ty Co phan Tuong Vien Grand | Security deposits | 9,825,345.55 | Within 1 Year | 15.62% | 491,267.28 |
| Park | |||||
| Hangzhou Qiantang Intellectual City Management Committee | Security deposits | 1,007,000.00 | Within 1 Year | 1.60% | 50,350.00 |
| Hangzhou Qiantang Intellectual City Management Committee | Security deposits | 1,908,000.00 | 4-5years | 3.03% | 954,000.00 |
| Social insurance premiums paid on behalf of employees | Temporary advance payment receivable | 1,413,772.67 | Within 1 Year | 2.25% | 70,688.63 |
| Subtotal | -- | 53,654,429.11 | -- | 85.28% | 3,541,321.45 |
| Debtors | Government subsidy | Closing balance | Ages | Estimated collection date, amount, and basis |
| Items | Closing balance | Opening balance | ||||
| Book balance | Provision for write-down | Carrying amount | Book balance | Provision for write-down | Carrying amount | |
| Raw materials | 366,335,310.08 | 366,335,310.08 | 308,211,274.15 | 308,211,274.15 | ||
| Work in process | 182,992,575.26 | 182,992,575.26 | 112,391,277.26 | 112,391,277.26 | ||
| Goods on hand | 861,447,538.76 | 32,384,531.09 | 829,063,007.67 | 808,125,084.72 | 39,360,433.56 | 768,764,651.16 |
| Materials on | 6,553,816.35 | 6,553,816.35 | 4,098,774.10 | 4,098,774.10 | ||
| consignment for further processing | ||||||
| Low-value consumables | 1,376,128.50 | 1,376,128.50 | 419,005.24 | 419,005.24 | ||
| Total | 1,418,705,368.95 | 32,384,531.09 | 1,386,320,837.86 | 1,233,245,415.47 | 39,360,433.56 | 1,193,884,981.91 |
| Items | Opening balance | Increase | Decrease | Closing balance | ||||||
| Accrual | Others | Write-off | Others | |||||||
| Goods on hand | 39,360,433.56 | 22,641,151.52 | -904,440.93 | 28,712,613.06 | 32,384,531.09 | |||||
| Subtotal | 39,360,433.56 | 22,641,151.52 | -904,440.93 | 28,712,613.06 | 32,384,531.09 | |||||
| Items | Determination basis of net realizable value | Reasons for reversal of provision for inventory write-down | Reasons for write-off of provision for inventory write-down | |||||||
| Goods on hand | Estimated selling price of relevant finished goods less cost to be incurred upon completion, estimated selling expenses, and relevant taxes and surcharges | Part of inventories with provision for inventory write-down made in preceding period were sold or scrapped in the current period and write-off this part provision for inventory |
| Items | Closing balance | Opening balance | ||||
| Book balance | Provision for impairment | Carrying amount | Book balance | Provision for impairment | Carrying amount | |
| Items | Increase/Decrease | Increase/Decrease reason |
Contract assets impairment in current period
Currency: RMB
| Items | Provision | Reavesal | written off | Reason for written off |
| Items | Closing balance | Provision for impairment | Carrying amount | Fair value | Estimated disposal costs | Estimated disposal date |
| Items | Closing balance | Opening balance |
| Finance lease receivable | 90,583.31 | 2,279,390.88 |
| Total | 90,583.31 | 2,279,390.88 |
| debt investments items | Closing balance | Opening balance | ||||||
| par value | Par value interest | effective interest rate | maturity | par value | Par value interest | effective interest rate | maturity | |
| Items | Closing balance | Opening balance |
| VAT to be credited | 97,366,157.47 | 87,876,733.41 |
| Prepaid expenses | 14,940,527.03 | 12,358,640.95 |
| Prepaid enterprise income tax | 13,455,322.72 | 15,968,601.60 |
| Interest on time deposit | 20,692,542.33 | 10,901,182.92 |
| Interest on bond investments | 169,237.64 | 872,751.71 |
| Total | 146,623,787.19 | 127,977,910.59 |
14、Debt investments
Currency: RMB
| Items | Closing balance | Opening balance | ||||
| Book balance | Provision for impairment | Carrying amount | Book balance | Provision for impairment | Carrying amount | |
| Items | Closing balance | Opening balance | ||||||
| par value | Par value interest | effective interest rate | maturity | par value | Par value interest | effective interest rate | maturity | |
| Items | Phase I | Phase II | Phase III | Total |
| 12?month expected credit losses | Lifetime expected credit losses (credit not impaired) | Lifetime expected credit losses (credit impaired) | ||
| Opening balance in the current period | —— | —— | —— | —— |
| Items | Opening balance | Accrued interest | Changes in fair value in current period | Closing balance | Cost | Accumulative changes in fair value | Accumulated provision recognized in other comprehensive income | Notes |
| Items | Closing balance | Opening balance | ||||||
| par value | Par value interest | effective interest rate | maturity | par value | Par value interest | effective interest rate | maturity | |
| Bad debt provision | Phase I | Phase II | Phase III | Total |
| 12?month expected credit losses | Lifetime expected credit losses (credit not impaired) | Lifetime expected credit losses (credit impaired) | ||
| Opening balance in the current period | —— | —— | —— | —— |
| Items | Closing balance | Opening balance | Discount rate range | ||||
| Book balance | Provision for bad debts | Carrying amount | Book balance | Provision for bad debts | Carrying amount | ||
| Finance lease payment | 576,205.61 | 576,205.61 | 16,292,063.74 | 16,292,063.74 | 0.75% | ||
| Including: Unrealized finance income | -17,021.38 | -17,021.38 | -720,280.00 | -720,280.00 | |||
| Deposit for land lease | 2,290,613.47 | 2,290,613.47 | 2,831,186.71 | 2,831,186.71 | |||
| Total | 2,866,819.08 | 2,866,819.08 | 19,123,250.45 | 19,123,250.45 | -- | ||
| Items | Phase I | Phase II | Phase III | Total |
| 12?month expected credit losses | Lifetime expected credit losses (credit not impaired) | Lifetime expected credit losses (credit impaired) | ||
| Opening balance in the current period | —— | —— | —— | —— |
17、Long-term equity investments
Currency: RMB
| Investees | Opening balance | Increase/Decrease | Closing balance | Closing balance of provision for impairment | |||||||
| Investments increased | Investments decreased | Investment income recognized under equity method | Adjustment in other comprehensive income | Changes in other equity | Cash dividend/ Profit declared for distribution | Provision for impairment | Others | ||||
| I. joint ventures | |||||||||||
| II. Associates | |||||||||||
| Hangzhou Zhongce Haichao Enterprise Management Co., Ltd. | 996,969,390.74 | 175,692,233.49 | -22,084,251.05 | 19,355,033.13 | 1,169,932,406.31 | ||||||
| Zhejiang Hangcha Holding Co., Ltd. | 572,215,254.96 | 79,306,058.52 | -2,129,229.65 | 1,224,640.08 | 20,000,000.00 | 630,616,723.91 | |||||
| Hangzhou Weiming Investment Management Co., Ltd. | 55,838,362.71 | 2,199,270.14 | 58,037,632.85 | ||||||||
| Zhejiang Guozi Robotics Co., Ltd. | 51,459,603.66 | -1,946,855.30 | 1,369.57 | 40,030,405.87 | 89,544,523.80 | ||||||
| Ningbo Donghai Bank Co., Ltd. | 177,447,885.49 | 3,871,861.00 | 181,319,746.49 | ||||||||
| Changzhou Stabila | 2,504,323.60 | -31,865.31 | 2,472,458.29 | ||||||||
| Laser Instrument Company Limited | |||||||||||
| Hangzhou Weina Technologies Co., Ltd. | 74,910,130.09 | 1,439,514.90 | -394,676.97 | 75,954,968.02 | |||||||
| Hangzhou Meiqi Technology Co., Ltd.[Note] | |||||||||||
| Subtotal | 1,931,344,951.25 | 260,530,217.44 | -24,606,788.10 | 60,610,079.08 | 20,000,000.00 | 2,207,878,459.67 | |||||
| Total | 1,931,344,951.25 | 260,530,217.44 | -24,606,788.10 | 60,610,079.08 | 20,000,000.00 | 2,207,878,459.67 |
| Items | Closing balance | Opening balance |
| Hangzhou Haibang Xinhu Talent Venture Capital Investment Partnership (LP) | 16,550,000.00 | 16,550,000.00 |
| Zhejiang SUPCON Information Technology Co., Ltd. | 176,000,000.00 | |
| Subtotal | 16,550,000.00 | 192,550,000.00 |
| Items | Dividends income | Accumulative gain | Accumulative loss | other comprehensive income | Reason for appointed as financial assets at | Reason for other comprehensive income |
| transferred to retained earnings | fair value through other comprehensive income | transferred to retained earnings |
| Items | Fair value when derecognized | Accumulated gains or losses when derecognized | Reasons for disposal |
| Zhejiang SUPCON Information Technology Co., Ltd. | 176,888,118.45 | 47,151,416.95 | Sale |
| Subtotal | 176,888,118.45 | 47,151,416.95 |
| Items | Closing balance | Opening balance |
| Financial assets classified as at fair value through profit or loss | 569,209.09 | |
| Total | 569,209.09 |
| Items | Book balance | Reasons for unsettlement |
21、Fixed assets
Currency: RMB
| Items | Closing balance | Opening balance |
| Fixed assets | 1,348,034,595.31 | 1,058,454,179.69 |
| Total | 1,348,034,595.31 | 1,058,454,179.69 |
| Items | Buildings and structures | General equipment | Special equipment | Transport facilities | Total |
| Cost: | |||||
| Opening balance | 930,022,227.99 | 89,682,598.10 | 835,046,811.57 | 30,907,225.44 | 1,885,658,863.10 |
| Increase | 261,710,437.14 | 36,407,844.84 | 143,303,459.11 | 4,053,810.06 | 445,475,551.15 |
| 1) Acquisition | 94,304,231.15 | 28,993,231.24 | 104,002,042.11 | 1,112,239.51 | 228,411,744.01 |
| 2) Transferred in from construction in progress | 172,403,786.40 | 2,606,282.71 | 10,941,232.60 | 185,951,301.71 | |
| 3) Business combination | 6,964,459.80 | 5,609,920.17 | 31,398,000.98 | 3,168,456.56 | 47,140,837.51 |
| 4) Effect of exchange rate fluctuations | -11,962,040.21 | -801,589.28 | -3,037,816.58 | -226,886.01 | -16,028,332.08 |
| Decrease | 1,334,993.26 | 12,118,216.71 | 3,015,970.67 | 16,469,180.64 | |
| 1) Disposal/Scrapping | 1,334,993.26 | 12,118,216.71 | 3,015,970.67 | 16,469,180.64 | |
| Closing balance | 1,191,732,665.13 | 124,755,449.68 | 966,232,053.97 | 31,945,064.83 | 2,314,665,233.61 |
| Accumulated depreciation | |||||
| Opening balance | 261,527,814.92 | 59,106,393.82 | 481,484,153.35 | 25,086,321.32 | 827,204,683.41 |
| Increase | 48,381,046.25 | 19,313,887.77 | 78,394,138.21 | 5,726,917.29 | 151,815,989.52 |
| 1) Accrual | 47,206,755.32 | 16,021,599.89 | 62,324,553.87 | 2,827,139.03 | 128,380,048.11 |
| 2) Business combination | 835,576.61 | 3,159,042.30 | 15,780,292.86 | 2,752,108.90 | 22,527,020.67 |
| 3) Effect of exchange rate fluctuations | 338,714.32 | 133,245.58 | 289,291.48 | 147,669.36 | 908,920.74 |
| Decrease | 986,808.21 | 8,629,878.05 | 2,773,348.37 | 12,390,034.63 | |
| 1）Disposal/Scrapping | 986,808.21 | 8,629,878.05 | 2,773,348.37 | 12,390,034.63 | |
| Closing balance | 309,908,861.17 | 77,433,473.38 | 551,248,413.51 | 28,039,890.24 | 966,630,638.30 |
| Provision for impairment | |||||
| Opening balance | |||||
| Increase | |||||
| 1) Accrual | |||||
| Decrease | |||||
| 1）Disposal/Scrapping | |||||
| Closing balance | |||||
| Carrying amount | |||||
| Closing balance | 881,823,803.96 | 47,321,976.30 | 414,983,640.46 | 3,905,174.59 | 1,348,034,595.31 |
| Opening balance | 668,494,413.07 | 30,576,204.28 | 353,562,658.22 | 5,820,904.12 | 1,058,454,179.69 |
| Items | Cost | Accumulated depreciation | Provision for impairment | Carrying amount | Notes |
| Items | Cost | Accumulated depreciation | Provision for impairment | Carrying amount |
| Special equipment | 883,369.74 | 441,684.84 | 441,684.90 | |
| Transport facilities | 2,267,829.15 | 407,937.20 | 1,859,891.95 | |
| Subtotal | 3,151,198.89 | 849,622.04 | 2,301,576.85 |
| Items | Closing balance |
| Items | Carrying amount | Reasons for unsettlement |
| Industrial plant of杭州联和机械有限公司 (Hangzhou Lianhe Machinery Co., Ltd. ) | 135,395,254.21 | Documents required for certificate of titles t have not yet been collected. |
| Subtotal | 135,395,254.21 |
| Items | Closing balance | Opening balance |
| Items | Closing balance | Opening balance |
| Construction in progress | 166,268,204.96 | 129,158,811.57 |
| Total | 166,268,204.96 | 129,158,811.57 |
| Projects | Closing balance | Closing balance | ||||
| Book balance | Provision for impairment | Carrying amount | Book balance | Provision for impairment | Carrying amount | |
| Thailand toolbox production base construction project | 98,361,339.68 | 98,361,339.68 | ||||
| Vietnam joint factory equipment installation | 11,725,996.39 | 11,725,996.39 | ||||
| Vietnam joint factory construction | 8,565,450.70 | 8,565,450.70 | ||||
| project | ||||||
| Plant project of Hangzhou Lianhe Machinery Co., Ltd. | 91,934,244.91 | 91,934,244.91 | ||||
| Reconstruction and expansion project of Haining Great Star Intelligent Equipment Co., Ltd. | 10,660,511.34 | 10,660,511.34 | ||||
| Automated warehousing system | 20,409,451.31 | 20,409,451.31 | 12,649,247.79 | 12,649,247.79 | ||
| Sporadic projects | 27,205,966.88 | 27,205,966.88 | 13,914,807.53 | 13,914,807.53 | ||
| Total | 166,268,204.96 | 166,268,204.96 | 129,158,811.57 | 129,158,811.57 |
| Projects | Budgets | Opening balance | Increase | Transferred to fixed assets | Other decrease | Closing balance | Accumulated input to budget | Completion percentage (%) | Accumulated amount of interest capitalization | Amount of interest capitalization in current period | Annual capitalization rate (%) | Fund source |
| Thailand toolbox production base construction project | 116,785,800.00 | 99,528,903.50 | 1,167,563.82 | 98,361,339.68 | 84.22% | 83.00 | 2,802,352.65 | 2,802,352.65 | 6.48% | Others | ||
| Vietnam joint factory construction project | 10,875,300.00 | 9,045,227.99 | 479,777.29 | 8,565,450.70 | 78.76% | 81.00 | Others |
| Plant project of Hangzhou Lianhe Machinery Co., Ltd. | 120,000,000.00 | 91,934,244.91 | 44,915,972.54 | 136,850,217.45 | 114.04% | 100.00 | Others | |||||
| Reconstruction and expansion project of Haining Great Star Intelligent Equipment Co., Ltd. | 27,000,000.00 | 10,660,511.34 | 19,703,950.49 | 30,364,461.83 | 112.46% | 100.00 | 812,420.02 | 812,420.02 | 6.48% | Others | ||
| Automated warehousing system | 34,008,800.00 | 12,649,247.79 | 12,248,779.17 | 4,488,575.65 | 20,409,451.31 | 73.21% | 70.00 | 1,815,040.14 | 1,815,040.14 | 6.48% | Others | |
| Subtotal | 308,669,900.00 | 115,244,004.04 | 185,442,833.69 | 171,703,254.93 | 1,647,341.11 | 127,336,241.69 | -- | -- | 5,429,812.81 | 5,429,812.81 | -- |
| Items | Provision for impairment | Provision Reason |
| Items | Closing balance | Opening balance | ||||
| Book balance | Provision for impairment | Carrying amount | Book balance | Provision for impairment | Carrying amount | |
Other instructions:
23、Productive biological assets
（1）Productive biological assets measured with Cost Model
□ applicable√ not applicable
（2）Productive biological assets measured with fair value model
□ applicable√ not applicable
24、Oil & gas assets
□ applicable√ not applicable
25、Right-of-use assets
Currency: RMB
| Items | Buildings and structures | General equipment | Special equipment | Transport facilities | Total |
| Opening balance | 227,889,389.20 | 1,851,119.60 | 842,727.60 | 5,018,621.92 | 235,601,858.32 |
| Increase | 103,058,550.77 | 1,383,052.42 | 23,142.60 | 2,737,520.97 | 107,202,266.76 |
| (1) New leases | 96,852,160.77 | 1,332,217.82 | 2,599,701.86 | 100,784,080.45 | |
| (2) Effect of exchange rate fluctuations | 6,206,390.00 | 50,834.60 | 23,142.60 | 137,819.11 | 6,418,186.31 |
| Decrease | 42,990,085.40 | 229,418.60 | 865,870.20 | 3,359,872.40 | 47,445,246.60 |
| (1) Expiration of leases | 42,990,085.40 | 229,418.60 | 865,870.20 | 3,359,872.40 | 47,445,246.60 |
| Closing balance | 287,957,854.57 | 3,004,753.42 | 4,396,270.49 | 295,358,878.48 | |
| Opening balance | 24,813,646.00 | 259,300.80 | 172,867.20 | 1,582,854.92 | 26,828,668.92 |
| Increase | 25,688,048.40 | 1,006,201.80 | 100,955.00 | 2,174,840.44 | 28,970,045.64 |
| (1) New leases | 24,921,012.90 | 995,071.50 | 95,821.70 | 2,122,819.20 | 28,134,725.30 |
| (2) Effect of exchange rate fluctuations | 767,035.50 | 11,130.30 | 5,133.30 | 52,021.24 | 835,320.34 |
| Decrease | 26,901,040.61 | 708,930.56 | 273,822.20 | 2,226,551.48 | 30,110,344.85 |
| (1) Expiration of leases | 26,901,040.61 | 708,930.56 | 273,822.20 | 2,226,551.48 | 30,110,344.85 |
| Closing balance | 23,600,653.79 | 556,572.04 | 1,531,143.88 | 25,688,369.71 | |
| Closing balance | 264,357,200.78 | 2,448,181.38 | 2,865,126.61 | 269,670,508.77 |
| Opening balance | 203,075,743.20 | 1,591,818.80 | 669,860.40 | 3,435,767.00 | 208,773,189.40 |
| Items | Land use right | Patent right | Non-Proprietary technology | Land ownership | Trademark right | Proprietary technology | Management software | Sewage disposal right | Total |
| Cost | |||||||||
| Opening balance | 213,674,408.42 | 3,205,142.01 | 59,992,719.31 | 227,168,662.73 | 18,478,820.35 | 96,563,124.42 | 2,648,543.69 | 621,731,420.93 | |
| Increase | 24,068,745.90 | 1,213,047.38 | 38,207,885.67 | 48,290,095.81 | 7,336,395.03 | 119,116,169.79 | |||
| （1）Acquisition | 24,799,322.82 | 1,213,047.38 | 36,587,298.83 | 48,179,302.03 | 6,756,472.01 | 117,535,443.07 | |||
| （2）internal R&D | |||||||||
| （3）Business combination | 2,699,789.40 | 215,016.23 | 2,914,805.63 | ||||||
| （4）Effect of exchange rate fluctuations | -730,576.92 | -1,079,202.56 | 110,793.78 | 364,906.79 | -1,334,078.91 | ||||
| Decrease | 204,740.35 | 204,740.35 | |||||||
| 1) Disposal | 204,740.35 | 204,740.35 | |||||||
| Closing balance | 237,743,154.32 | 4,418,189.39 | 98,200,604.98 | 275,458,758.54 | 18,478,820.35 | 103,694,779.10 | 2,648,543.69 | 740,642,850.37 | |
| Accumulate |
| d amortization | |||||||||
| Opening balance | 29,922,995.71 | 1,452,800.58 | 761,779.69 | 7,753,405.03 | 73,879,710.53 | 154,498.40 | 113,925,189.94 | ||
| Increase | 5,066,033.96 | 687,358.97 | 740,645.03 | 1,755,487.93 | 10,691,425.71 | 264,854.40 | 19,205,806.00 | ||
| 1) Accrual | 5,068,063.34 | 687,358.97 | 828,775.92 | 1,755,487.93 | 10,032,603.59 | 264,854.40 | 18,637,144.15 | ||
| 2) Effect of exchange rate fluctuations | -2,029.38 | -88,130.89 | 572,331.32 | 482,171.05 | |||||
| 3) Business combination | 86,490.80 | 86,490.80 | |||||||
| Decrease | 204,740.35 | 204,740.35 | |||||||
| 1) Disposal | 204,740.35 | 204,740.35 | |||||||
| Closing balance | 34,989,029.67 | 2,140,159.55 | 1,502,424.72 | 9,508,892.96 | 84,366,395.89 | 419,352.80 | 132,926,255.59 | ||
| Provision for impairment | |||||||||
| Opening balance | |||||||||
| Increase | |||||||||
| 1) Accrual | |||||||||
| Decrease | |||||||||
| 1) Disposal |
| Closing balance | |||||||||
| Carrying amount | |||||||||
| Closing balance | 202,754,124.65 | 2,278,029.84 | 98,200,604.98 | 273,956,333.82 | 8,969,927.39 | 19,328,383.21 | 2,229,190.89 | 607,716,594.78 | |
| Opening balance | 183,751,412.71 | 1,752,341.43 | 59,992,719.31 | 226,406,883.04 | 10,725,415.32 | 22,683,413.89 | 2,494,045.29 | 507,806,230.99 |
| Items | Carrying amount | Reasons for unsettlement |
| Items | Opening balance | Increase | Decrease | Closing balance | ||||
| Internal Development expenditures | others | Recognized as intangible assets | Transferred into current profit and loss | |||||
| Total | ||||||||
| Investee or events resulting in | Opening balance | Increase | Decrease | Closing balance | ||
| Due to business | Effect of | Disposal | ||||
| goodwill | combination in current period | exchange rate fluctuations | ||||
| Lista Holding AG | 1,017,633,670.59 | 27,945,790.54 | 1,045,579,461.13 | |||
| Arrow Fastener Co., LLC | 650,446,935.60 | -42,078,309.40 | 608,368,626.20 | |||
| Changzhou Huada Kejie Opto-electro Instrument Co., Ltd. | 118,076,677.01 | 118,076,677.01 | ||||
| Prim' Tools Limited | 68,906,020.26 | -4,457,625.49 | 64,448,394.77 | |||
| Suzhou Xindadi Hardware Product Co., Ltd. | 42,288,608.30 | 42,288,608.30 | ||||
| Prexiso AG | 32,581,102.30 | 894,727.34 | 33,475,829.64 | |||
| Prime-Line Products, LLC | 29,997,660.00 | -1,940,590.00 | 28,057,070.00 | |||
| Longyou Hugong Forging Three Tools Co., Ltd. | 8,072,738.29 | 8,072,738.29 | ||||
| Eudura Holding Limited | 5,677,361.84 | 5,677,361.84 | ||||
| 海宁十倍得刀具有限公司 (Haining Sheffield Cutting Tools Co., Ltd.) | 884,415.32 | 884,415.32 | ||||
| 浙江国新工具有限公司 (Zhejiang Guoxin Tools Co., Ltd.) | 308,667.41 | 308,667.41 | ||||
| 龙游亿洋锻造有限公司 (Longyou Yiyang Forging Co., Ltd.) | 170,033.92 | 170,033.92 | ||||
| Total | 1,932,755,282.54 | 42,288,608.30 | -19,636,007.01 | 1,955,407,883.83 |
（2）Provision for impairment
Currency: RMB
| Investees or events resulting in goodwill | Opening balance | Increase | Decrease | Closing balance | ||
| Provision made | Others | Disposal | ||||
| Changzhou Huada Kejie Opto-electro Instrument Co., Ltd. | 58,591,956.96 | 58,591,956.96 | ||||
| Lista Holding AG | 70,398,887.67 | 70,398,887.67 | ||||
| Longyou Hugong Forging Three Tools Co., Ltd. | 444,527.83 | 444,527.81 | 889,055.64 | |||
| Subtotal | 59,036,484.79 | 70,843,415.48 | 129,879,900.27 | |||
| Composition of asset group or asset group portfolios | Relevant asset group of Lista Holding AG |
| Carrying amount of asset group or asset group portfolios | 625,849,426.54 |
| Carrying amount of goodwill allocated to the asset group or asset group portfolios | 1,045,579,461.13 |
| Carrying amount of asset group or asset group portfolios that include goodwill | 1,671,428,887.67 |
| Whether asset group or asset group portfolios are consistent with those at acquisition date or goodwill impairment test in previous years | Yes |
and the cash flows subsequent to the estimated period are expected to be stable.Other key data used in the impairment test include: the estimated selling price, sales amount, cost of product, and other relevantexpenses.Such key data are determined by the Company based on its experience and its prediction towards market development. The discountrate used by the Company is the pre-tax interest rate that reveals the time value of currency under the current market situation andspecial risks of certain asset group.Pursuant to the Evaluation Report numbered Wan Bang Ping Bao [2021] 55 issued by 万邦资产评估有限公司 (Wanbang AssetAppraisal Co., Ltd.), which is engaged by the Company, the recoverable amount of asset group or asset group portfolios that includegoodwill totaled RMB 1,601,030,000.00, and the carrying amount totaled RMB 1,671,428,887.67. RMB70,398,887.67 is recognizedas goodwill impairment loss, RMB70,398,887.67 of which is attributable to goodwill impairment loss to be recognized.
2）Arrow Fastener Co., LLC
① Related information of asset group or asset group portfolios which include goodwill
| Composition of asset group or asset group portfolios | Relevant asset group of Arrow Fastener Co., LLC |
| Carrying amount of asset group or asset group portfolios | 316,470,718.16 |
| Carrying amount of goodwill allocated to the asset group or asset group portfolios | 608,368,626.20 |
| Carrying amount of asset group or asset group portfolios that include goodwill | 924,839,344.36 |
| Whether asset group or asset group portfolios are consistent with those at acquisition date or goodwill impairment test in previous years | Yes |
| Composition of asset group or asset group portfolios | Relevant asset group of Changzhou Huada Kejie Opto-electro Instrument Co., Ltd. |
| Carrying amount of asset group or asset group portfolios | 250,881,158.22 |
| Carrying amount of goodwill allocated to the asset group or asset group portfolios [Note] | 91,514,953.92 |
| Carrying amount of asset group or asset group portfolios that include goodwill | 342,396,112.14 |
| Whether asset group or asset group portfolios are consistent with those at acquisition date or goodwill impairment test in previous years | Yes |
| Composition of asset group or asset group portfolios | Relevant asset group of Prim’ Tools Limited |
| Carrying amount of asset group or asset group portfolios | 78,074,764.54 |
| Carrying amount of goodwill allocated to the asset group or asset group portfolios | 64,448,394.77 |
| Carrying amount of asset group or asset group portfolios that include goodwill | 142,523,159.31 |
| Whether asset group or asset group portfolios are consistent with those at acquisition date or goodwill impairment test in previous years | Yes |
discount rate used by the Company is the pre-tax interest rate that reveals the time value of currency under the current market situationand special risks of certain asset group.Pursuant to the Evaluation Report numbered Wan Bang Ping Bao [2021] 58 issued by Wanbang Asset Appraisal Co., Ltd., whichis engaged by the Company, the recoverable amount of asset group or asset group portfolios that include goodwill totaledRMB166,720,000.00, and the carrying amount totaled RMB 142,523,159.31, which suggests that the Company’s goodwill is notimpaired.
5）Prime-Line Products, LLC
① Related information of asset group or asset group portfolios which include goodwill
| Composition of asset group or asset group portfolios | Relevant asset group of Prime-Line Products, LLC |
| Carrying amount of asset group or asset group portfolios | 249,492,392.84 |
| Carrying amount of goodwill allocated to the asset group or asset group portfolios and the allocation method | 28,057,070.00 |
| Carrying amount of asset group or asset group portfolios that include goodwill | 277,549,462.84 |
| Whether asset group or asset group portfolios are consistent with those at acquisition date or goodwill impairment test in previous years | Yes |
The impact of goodwill impairment testingOther instructions
29、Long-term prepayments
Currency: RMB
| Items | Opening balance | Increase | Amortization | Other decrease | Closing balance |
| Renovation expenditures of leased-in fixed assets | 4,194,216.15 | 3,991,270.43 | 3,444,301.36 | 187,378.46 | 4,553,806.76 |
| Renovation costs | 1,752,759.47 | 3,707,413.08 | 1,335,252.65 | 103,510.08 | 4,021,409.82 |
| Mold fee | 7,199,198.88 | 318,656.99 | 6,880,541.89 | ||
| Others | 77,777.64 | 1,212,272.07 | 276,069.54 | 62,564.01 | 951,416.16 |
| Total | 6,024,753.26 | 16,110,154.46 | 5,374,280.54 | 353,452.55 | 16,407,174.63 |
| Items | Closing balance | Opening balance | ||
| Deductible temporary difference | Deferred tax assets | Deductible temporary difference | Deferred tax assets | |
| Provision for bad debts | 100,617,084.64 | 18,425,274.76 | 53,172,174.21 | 8,369,173.79 |
| Provision for inventory write-down | 14,637,463.50 | 3,493,823.04 | ||
| Mold expenses | 761,879.36 | 129,530.29 | 1,437,300.90 | 246,267.75 |
| Changes in fair value of held-for-trading financial assets | 4,901,459.62 | 735,218.94 | ||
| Amortization of intangible assets | 3,218,349.29 | 823,629.59 | ||
| Accrued expenses | 69,962,139.59 | 18,147,982.88 | 65,238,262.38 | 16,857,862.94 |
| Provision for impairment of long-term equity investments | 2,910,780.00 | 436,617.00 | 2,977,272.88 | 446,590.93 |
| Deferred income | 2,377,073.64 | 356,561.05 | 3,197,295.96 | 479,594.39 |
| Total | 194,484,770.02 | 41,813,418.61 | 130,923,765.95 | 27,134,708.74 |
（2）Deferred tax liabilities before offset
Currency: RMB
| Items | Closing balance | Opening balance | ||
| Taxable temporary difference | Deferred tax liabilities | Taxable temporary difference | Deferred tax liabilities | |
| Assets appraisal appreciation due to business combination not under common control | 96,948,432.28 | 23,125,437.83 | 43,255,993.77 | 10,813,998.44 |
| Changes in fair value of other equity investments | 54,427,410.00 | 8,164,111.50 | ||
| Changes in fair value of held-for-trading financial assets | 15,998,041.01 | 2,437,850.39 | 12,824,559.79 | 2,010,555.87 |
| Interest receivable | 20,692,542.33 | 3,103,881.35 | 10,901,182.92 | 1,635,177.44 |
| Depreciation of fixed assets | 133,958,906.16 | 33,686,297.20 | 111,877,032.56 | 22,898,478.93 |
| Provision for inventory write-down | 17,806,826.55 | 2,434,886.06 | 6,189,389.65 | 617,230.51 |
| Amortization of intangible assets | 11,125,082.94 | 1,519,686.35 | 5,700,225.60 | 968,461.50 |
| Accrued expenses | 67,723,008.58 | 15,002,925.88 | 34,747,351.61 | 5,891,242.15 |
| Others | 54,633,302.70 | 5,609,721.54 | 39,818,748.60 | 6,747,482.19 |
| Total | 418,886,142.55 | 86,920,686.60 | 319,741,894.50 | 59,746,738.53 |
| Items | Deferred tax assets and liabilities offset at the end of the period | closing balance of deferred tax assets or liabilities after offset | Deferred tax assets and liabilities offset at the beginning of the period | Opening balance of deferred tax assets or liabilities after offset |
| Deferred tax assets | 41,813,418.61 | 27,134,708.74 | ||
| Deferred tax liabilities | 86,920,686.60 | 59,746,738.53 |
| Items | Closing balance | Opening balance |
| Deductible losses | 170,355,993.72 | 182,150,262.60 |
| Subtotal | 170,355,993.72 | 182,150,262.60 |
| Maturity years | Closing balance | Opening balance | Notes |
| Year 2020 | 6,122,957.91 | 25,423,005.22 | |
| Year 2021 | 5,367,819.70 | 31,131,336.70 | |
| Year 2022 | 10,546,843.54 | 22,764,184.59 | |
| Year 2023 | 14,557,139.03 | 45,599,586.67 | |
| Year 2024 | 34,787,819.71 | 57,232,149.42 | |
| Year 2025 | 38,209,711.39 | ||
| Year 2026 | 2,493,654.05 | ||
| Year 2027 | 7,204,355.21 | ||
| Year 2028 | 30,073,191.20 | ||
| Year 2029 | 7,438,617.58 | ||
| Year 2030 | 13,553,884.40 | ||
| Subtotal | 170,355,993.72 | 182,150,262.60 | -- |
| Items | Closing balance | Opening balance | ||||
| Book balance | Provision for impairment | Carrying amount | Book balance | Provision for impairment | Carrying amount | |
| Prepayment for equipment | 23,212,306.28 | 23,212,306.28 | 26,688,943.57 | 26,688,943.57 | ||
| Prepayment for intangible assets | 15,505,452.23 | 15,505,452.23 | 989,310.02 | 989,310.02 | ||
| Land lease expenses | 720,572.67 | 720,572.67 | 737,147.07 | 737,147.07 | ||
| Prepaid earnest money for equity purchase | 5,000,000.00 | 5,000,000.00 | ||||
| Total | 39,438,331.18 | 39,438,331.18 | 33,415,400.66 | 33,415,400.66 | ||
32、Short-term borrowings
（1）Details on categories Short-term loan classification
Currency: RMB
| Items | Closing balance | Opening balance |
| Pledged borrowings | 104,398,400.00 | |
| Mortgaged borrowings | 10,000,000.00 | 12,000,000.00 |
| Credit borrowings | 854,263,538.00 | 808,890,390.00 |
| Undue interest accrued | 2,055,972.75 | 2,570,254.57 |
| Mortgaged and guaranteed borrowings | 44,400,000.00 | |
| Total | 1,015,117,910.75 | 823,460,644.57 |
| Debtors | Closing balance | Interest rate | Overdue days | Interest rate during overdue |
| Items | Closing balance | Opening balance |
| Held-for-trading financial liabilities | 4,901,459.62 | |
| Including: | ||
| Derivative financial liabilities | 4,901,459.62 | |
| Including: | ||
| Total | 4,901,459.62 |
| Items | Closing balance | Opening balance |
35、Notes payable
Currency: RMB
| Items | Closing balance | Opening balance |
| Bank acceptance | 24,913,000.00 | 309,180,000.00 |
| Total | 24,913,000.00 | 309,180,000.00 |
| Items | Closing balance | Opening balance |
| Payment for materials | 973,019,822.37 | 793,310,475.37 |
| Payment for engineering equipment | 60,602,036.33 | 43,743,792.32 |
| Expenses | 134,706,127.18 | 56,579,584.44 |
| Total | 1,168,327,985.88 | 893,633,852.13 |
| Items | Closing balance | Reason for unpaid or not carried forward |
| Items | Closing balance | Opening balance |
| Items | Closing balance | Reason for unpaid or not carried forward |
| Items | Closing balance | Opening balance |
| Payment for goods | 72,490,372.55 | 56,674,240.40 |
| Total | 72,490,372.55 | 56,674,240.40 |
| Items | Increase/Decrease | Reason for change |
| Items | Opening balance | Increase | Decrease | Closing balance |
| Short-term employee benefits | 144,948,543.14 | 1,251,570,057.49 | 1,202,388,697.20 | 194,129,903.43 |
| Post-employment benefits - defined contribution plan | 6,222,699.86 | 48,793,274.53 | 53,237,880.34 | 1,778,094.05 |
| Total | 151,171,243.00 | 1,300,363,332.02 | 1,255,626,577.54 | 195,907,997.48 |
| Items | Opening balance | Increase | Decrease | Closing balance |
| 1、Wage, bonus, allowance and subsidy | 136,791,916.89 | 1,119,197,482.27 | 1,065,401,515.52 | 190,587,883.64 |
| 2、Employee welfare fund | 55,705,766.91 | 60,360,992.13 | -4,655,225.22 | |
| 3、Social insurance premium | 3,521,305.42 | 49,979,432.09 | 50,168,539.66 | 3,332,197.85 |
| Including: Medicare premium | 3,055,252.09 | 45,784,468.36 | 45,575,929.42 | 3,263,791.03 |
| Occupational injuries premium | 185,414.82 | 3,472,478.25 | 3,613,342.22 | 44,550.85 |
| Maternity premium | 280,638.51 | 722,485.48 | 979,268.02 | 23,855.97 |
| 4、Housing provident fund | 156,274.00 | 21,118,210.64 | 21,153,240.64 | 121,244.00 |
| 5、Trade union fund and | 4,479,046.83 | 5,569,165.58 | 5,304,409.25 | 4,743,803.16 |
| employee education fund | ||||
| Subtotal | 144,948,543.14 | 1,251,570,057.49 | 1,202,388,697.20 | 194,129,903.43 |
| Items | Opening balance | Increase | Decrease | Closing balance |
| 1、Basic endowment insurance premium | 6,084,764.29 | 48,170,527.66 | 52,538,134.04 | 1,717,157.91 |
| 2、Unemployment insurance premium | 137,935.57 | 622,746.87 | 699,746.30 | 60,936.14 |
| Subtotal | 6,222,699.86 | 48,793,274.53 | 53,237,880.34 | 1,778,094.05 |
| Items | Closing balance | Opening balance |
| VAT | 6,485,281.06 | 6,964,841.10 |
| Enterprise income tax | 158,280,518.60 | 65,200,721.36 |
| Individual income tax withheld for tax authorities | 8,497,838.70 | 1,698,755.78 |
| Urban maintenance and construction tax | 842,381.53 | 497,031.19 |
| Housing property tax | 5,290,714.69 | 3,765,036.09 |
| Consumption tax withheld for tax authorities | 3,069,169.41 | 2,445,137.08 |
| Land use tax | 1,819,423.84 | 1,121,481.58 |
| Stamp duty | 1,040,706.33 | 602,715.34 |
| Education surcharge | 384,823.00 | 255,664.88 |
| Local education surcharge | 256,548.64 | 165,601.83 |
| Security fund for the disabled | 26,892.81 | 148,061.28 |
| Environmental protection tax | 1,434.06 | 1,564.00 |
| Total | 185,995,732.67 | 82,866,611.51 |
| Items | Closing balance | Opening balance |
| Other payables | 26,425,047.57 | 12,600,147.87 |
| Total | 26,425,047.57 | 12,600,147.87 |
| Items | Closing balance | Opening balance |
| Debtors | Overdue amount | Overdue reason |
| Items | Closing balance | Opening balance |
| Items | Closing balance | Opening balance |
| Security deposits | 221,768.95 | 325,026.47 |
| Guarantee fee payable | 4,299,910.32 | |
| accrued expenses | 3,666,627.54 | 3,495,534.08 |
| Fund borrowing | 16,850,810.54 | |
| prepayments payable | 2,895,356.49 | 2,605,202.95 |
| Others | 2,790,484.05 | 1,874,474.05 |
| Total | 26,425,047.57 | 12,600,147.87 |
| Items | Closing balance | Reason for unpaid or not carried forward |
42、Liabilities held for sale
Currency: RMB
| Items | Closing balance | Opening balance |
| Items | Closing balance | Opening balance |
| Long-term borrowings due within one year | 196,000,160.14 | 151,675,000.00 |
| Lease liabilities due within one year | 25,546,871.20 | 29,661,130.40 |
| Accrued interest payable on undue long-term borrowings | 167,152.56 | 206,516.64 |
| Total | 221,714,183.90 | 181,542,647.04 |
| Lenders | Commencement date | Maturity date | Currency | Annual interest rate (%) | Closing balance | |
| Original currency | RMB equivalent | |||||
| Export-Import Bank of China | 9/29/2017 | 3/29/2021 | RMB | 2.915% | 36,760,000.00 | 36,760,000.00 |
| 9/29/2021 | 36,760,000.00 | 36,760,000.00 | ||||
| Industrial and Commercial Bank of China | 8/31/2018 | 2/26/2021 | EUR | 3-month Euribor+ 1.05% | 7,250,000.00 | 58,181,250.00 |
| 8/31/2021 | 7,250,000.00 | 58,181,250.00 |
| Credit Suisse | 12/18/2020 | 2/18/2021 | EUR | libor+0.80% | 762,325.25 | 6,117,660.14 |
| Subtotal | 9/29/2017 | 196,000,160.14 |
| Items | Closing balance | Opening balance |
| Bonds | Par value | Issuing date | Maturity | Amount outstanding | Opening balance | Current period issuance | Par value interest | Amortization of premium discount | repayments | Closing balance |
45、Long-term borrowings
（1）Details on categories
Currency: RMB
| Items | Closing balance | Opening balance |
| Pledged borrowings | 220,640,000.00 | 294,160,000.00 |
| Guaranteed borrowings | 272,850,000.00 | 394,682,750.00 |
| Credit borrowings | 15,630,964.56 | |
| Accrued interest payable on undue long-term borrowings | 434,918.35 | 542,258.46 |
| Total | 509,555,882.91 | 689,385,008.46 |
| Lenders | Commencement date | Maturity date | Currency | Annual interest rate (%) | Closing balance | |
| Original currency | RMB equivalent | |||||
| Export-Import Bank of China | 9/29/2017 | 3/29/2022 | RMB | 2.915% | 36,760,000.00 | 36,760,000.00 |
| 9/29/2022 | 36,760,000.00 | 36,760,000.00 | ||||
| 3/29/2023 | 36,760,000.00 | 36,760,000.00 | ||||
| 9/29/2023 | 36,760,000.00 | 36,760,000.00 | ||||
| 3/29/2024 | 36,760,000.00 | 36,760,000.00 | ||||
| 9/29/2024 | 36,840,000.00 | 36,840,000.00 | ||||
| Industrial and Commercial Bank of China | 8/31/2018 | 2/28/2022 | EUR | 3-month Euribor+ 1.05% | 8,000,000.00 | 64,200,000.00 |
| 8/31/2022 | 8,000,000.00 | 64,200,000.00 | ||||
| 2/28/2023 | 9,000,000.00 | 72,225,000.00 | ||||
| 6/26/2023 | 9,000,000.00 | 72,225,000.00 | ||||
| Credit Suisse | 12/18/2020 | 2/18/2022 | EUR | Libor+ 0.80% | 777,216.40 | 6,237,161.64 |
| 2/18/2023 | 777,216.40 | 6,237,161.64 | ||||
| 2/18/2024 | 183,241.94 | 1,470,516.58 | ||||
| Kanagawa Credit Guarantee Association | 7/31/2020 | 7/31/2023 | JPY | 1.40% | 26,664,000.00 | 1,686,124.70 |
| Subtotal | 509,120,964.56 |
| Items | Closing balance | Opening balance |
| Convertible corporate bonds | 799,729,005.89 | |
| Total | 799,729,005.89 |
| Bonds | Par value | Issuing date | Maturity | Amount outstanding | Opening balance | Current period issuance | Par value interest | Amortization of premium discount | repayments | Interest adjustment | Issuing expenses | Equity split | Closing balance |
| Great Star convertible bonds | 972,600,000.00 | 6/24/2020 | 6/24/2020 - 6/23/2026 | 972,600,000.00 | 972,600,000.00 | 1,945,200.00 | 23,171,610.34 | 7,478,547.17 | 190,509,257.28 | 799,729,005.89 | |||
| Subtotal | -- | -- | -- | 972,600,000.00 | 972,600,000.00 | 1,945,200.00 | 23,171,610.34 | 7,478,547.17 | 190,509,257.28 | 799,729,005.89 |
| Financial instruments issued | Beginning of the period | Increase | Decrease | End of the period | ||||
| Amount | Book value | Amount | Book value | Amount | Book value | Amount | Book value | |
Other instructions:
47、Lease liabilities
Currency: RMB
| Items | Closing balance | Opening balance |
| Unpaid lease payments | 247,806,320.88 | 203,788,820.40 |
| Less: Unrecognized financing expenses | -1,502,321.80 | -5,654,198.00 |
| Total | 246,303,999.08 | 198,134,622.40 |
| Items | Closing balance | Opening balance |
| Long-term payables | 1,499,174.07 | 2,475,860.36 |
| Total | 1,499,174.07 | 2,475,860.36 |
| Items | Closing balance | Opening balance |
| Finance lease payable | 1,499,174.07 | 2,475,860.36 |
| Items | Opening balance | Increase | Decrease | Closing balance | 形成原因reason |
| Items | Closing balance | Opening balance |
| Post-employment benefits - net defined benefit liability | 71,206,293.82 | 34,139,053.54 |
| Termination benefits | 6,718,437.33 | 5,258,577.00 |
| Total | 77,924,731.15 | 39,397,630.54 |
| Items | Year 2020 | Year 2019 |
| I、Opening balance | 505,405,191.66 | 434,226,309.60 |
| II、Components of defined benefit costs recognized in profit or loss | 10,179,212.90 | -6,668,095.55 |
| a. Current service cost | 8,867,192.70 | 6,862,495.77 |
| b. Past service cost | -17,012,621.55 | |
| c. Net interest expense or income | 1,312,020.20 | 3,482,030.23 |
| III、Components of defined benefit costs recognized in other comprehensive income | 39,367,976.90 | 51,961,071.41 |
| a. Actuarial gains and losses | 39,367,976.90 | 51,961,071.41 |
| IV、Other movements | 7,995,556.47 | 25,885,906.20 |
| a. Benefit paid | -16,835,135.60 | -782,208.32 |
| b. Paid by employees | 10,849,964.80 | 10,236,903.66 |
| c. Translation reserves | 13,980,727.27 | 16,431,210.86 |
| V、Closing balance | 562,947,937.93 | 505,405,191.66 |
| Items | Year 2020 | Year 2019 |
| I、Opening balance | 471,266,138.12 | 399,083,193.80 |
| II、Components of defined benefit costs recognized in profit or loss | 619,155.60 | 2,702,611.34 |
| a. Net interest expense or income | 1,208,827.60 | 3,195,273.24 |
| b. Management costs | -589,672.00 | -492,661.90 |
| III、Components of defined benefit costs recognized in other comprehensive income | 884,508.00 | 32,308,295.56 |
| 3、a. Actuarial gains and losses | 884,508.00 | 32,308,295.56 |
| IV、Other movements | 18,971,842.39 | 37,172,037.42 |
| a. Paid by employees | 10,849,964.80 | 10,236,903.66 |
| b. Paid by the Company | 10,849,964.80 | 10,236,903.66 |
| c. Benefit paid | -15,700,017.00 | 46,990.23 |
| d. Translation reserves | 12,971,929.79 | 16,651,239.87 |
| V、Closing balance | 491,741,644.11 | 471,266,138.12 |
| Items | Year 2020 | Year 2019 |
| Opening balance | 34,139,053.54 | 35,143,115.80 |
| Components of defined benefit costs recognized in profit or loss | 9,560,057.30 | -9,370,706.89 |
| Components of defined benefit costs recognized in other comprehensive income | 38,483,468.90 | 19,652,775.85 |
| Other movements | -10,976,285.92 | -11,286,131.22 |
| Closing balance | 71,206,293.82 | 34,139,053.54 |
| Items | Closing balance | Opening balance | Reasons for balance |
| Product Quality Assurance | 2,329,934.90 | 2,564,196.80 |
| Soil restoration expenses | 1,220,478.39 | 3,140,420.80 | |
| Total | 3,550,413.29 | 5,704,617.60 | -- |
| Items | Opening balance | Increase in current period | Decrease in current period | Closing balance | Reasons for balance |
| Government grants | 5,189,661.19 | 1,196,922.60 | 3,992,738.59 | Special subsidy | |
| Total | 5,189,661.19 | 1,196,922.60 | 3,992,738.59 | -- |
| Liability items | Opening balance | New grant amount in current period | Amount included in non-operating income in the current period | Amount included in other income in the current period | Write down cost amount in current period | Other adjustments | Closing balance | Asset related / income related |
| Special subsidy for construction of foreign trade public service platform | 1,521,888.82 | 442,666.68 | 1,079,222.14 | Asset related | ||||
| Special subsidy for "machine replacement" technical transformation project | 1,632,365.07 | 276,700.32 | 1,355,664.75 | Asset related | ||||
| Special subsidy for equipment manufacturing projects in strategic emerging | 1,149,999.80 | 230,000.04 | 919,999.76 | Asset related |
| industries | ||||||||
| Financial subsidy for capacity expansion project of new hand tool series products | 360,000.16 | 99,999.96 | 260,000.20 | Asset related | ||||
| Special subsidy for innovation capability building project of provincial enterprise technology center | 157,407.38 | 55,555.56 | 101,851.82 | Asset related | ||||
| Special funds for pilot and base construction of strategic emerging industries | 367,999.96 | 92,000.04 | 275,999.92 | Asset related | ||||
| Subtotal | 5,189,661.19 | 1,196,922.60 | 3,992,738.59 | |||||
| [note] the amount of government subsidies included in the current profit and loss is detailed in section 12 (7) 84 Explanation of government subsidy |
52、Other non-current liabilities
Currency: RMB
| Items | Closing balance | Opening balance |
| Opening balance | Increase and decrease of this change (+, -) | Closing balance | |||||
| Bonus New share issue | Bonus share | Conversion of provident fund into shares | Other | Subtotal | |||
| Total number of shares | 1,075,247,700.00 | 1,075,247,700.00 | |||||
| Financial instruments issued outstanding | beginning of the period | Increase in current period | Decrease in current period | end of the period | ||||
| Amount | Book value | Amount | Book value | Amount | Book value | Amount | Book value | |
| GreatStar convertible bond | 9,726,000 | 190,509,257.28 | 9,726,000 | 190,509,257.28 | ||||
| Total | 9,726,000 | 190,509,257.28 | 9,726,000 | 190,509,257.28 | ||||
The increase in other equity instruments in the current period is the equity component of convertible corporate bonds issued by theCompany. See section 12 (7) 46 notes on bonds payable for details.Other explanation:
55、Capital reserve
Currency: RMB
| Items | Opening balance | Increase | Decrease | Closing balance |
| Share premium | 1,901,160,742.34 | 1,959,810.76 | 1,899,200,931.58 | |
| Other capital reserve | 135,233,530.49 | 60,610,079.08 | 195,843,609.57 | |
| Total | 2,036,394,272.83 | 60,610,079.08 | 1,959,810.76 | 2,095,044,541.15 |
| Items | Opening balance | Increase | Decrease | Closing balance |
| Treasury stock | 105,492,690.23 | 105,492,690.23 | ||
| Total | 105,492,690.23 | 105,492,690.23 |
funds, not less than RMB 100 million (inclusive) and not more than RMB 200 million (inclusive), to repurchase part of theCompany’s shares through centralized bidding transaction. The repurchase price shall not exceed RMB17.5 per share, and therepurchase period shall not exceed 12 months following the date of approval. As of the end of the period, the repurchase period hasexpired. The special account for share repurchase has accumulatively repurchased 10,799,651 shares, and the accumulative paymenttotaled RMB 105,492,690.23 .
57、Other comprehensive income
Currency: RMB
| Items | Opening balance | Amount incurred in the current period | Closing balance | |||||
| Current period cumulative before income tax | Less: OCI previously recognized but transferred to profit or loss in current period | Less: OCI previously recognized but transferred to retained earnings in current period | Less: Income tax | Attributable to parent company | Attributable to non-controlling shareholders | |||
| I、Items not to be reclassified subsequently to profit or loss | -21,798,278.68 | -37,595,350.45 | 47,151,416.95 | -3,145,255.00 | -81,601,512.40 | -103,399,791.08 | ||
| Including: Changes in remeasurement of the defined benefit plan | -68,061,577.18 | -38,483,468.90 | -3,145,255.00 | -35,338,213.90 | -103,399,791.08 | |||
| Changes in fair value of other equity instrument investments | 46,263,298.50 | 888,118.45 | 47,151,416.95 | -46,263,298.50 | ||||
| II、Items to be reclassified subsequently to profit or loss | 166,803,678.24 | -169,241,234.03 | -169,241,234.03 | -7,650.07 | -2,437,555.79 | |||
| Including: Other comprehensive income to be transferred to profit or loss under equity method | -2,778,947.94 | -24,606,788.10 | -24,606,788.10 | -27,385,736.04 | ||||
| Translation reserves | 169,582,626.18 | -144,634,445.93 | -144,634,445.93 | -7,650.07 | 24,948,180.25 | |||
| Total | 145,005,399 | - | 47,151,41 | - | - | -7,650.07 | - | |
| .56 | 206,836,584.48 | 6.95 | 3,145,255.00 | 250,842,746.43 | 105,837,346.87 |
| Items | Opening balance | Increase | Decrease | Closing balance |
| Items | Opening balance | Increase in current period | Decrease in current period | Closing balance |
| Legal reserve | 429,856,864.70 | 91,745,899.76 | 521,602,764.46 | |
| Total | 429,856,864.70 | 91,745,899.76 | 521,602,764.46 |
| Items | Year 2020 | Year 2019 |
| Closing balance of the preceding period | 3,849,578,318.39 | 3,206,473,049.26 |
| Undistributed profit at the beginning of the period after adjustment | 3,849,578,318.39 | 3,206,473,049.26 |
| Add: Net profit attributable to owners of the parent company | 1,350,132,516.91 | 895,030,139.78 |
| Less: Appropriation of statutory surplus reserve | 91,745,899.76 | 49,679,741.34 |
| Dividend payable on ordinary shares | 202,245,129.31 | |
| Add: Other comprehensive income carried forward to retained earnings | 47,151,416.95 | |
| Closing balance | 5,155,116,352.49 | 3,849,578,318.39 |
3)、Due to the correction of major accounting errors, the undistributed profits at the beginning of the period are affected.
4)、The change of consolidation scope caused by the same control affects the opening undistributed profit.
5)、The other adjustments affects the opening undistributed profit.
61、Operating revenue and operating costs
Currency: RMB
| Items | Year 2020 | Year 2019 | ||
| Revenue | Cost | Revenue | Cost | |
| Main business | 8,502,327,129.89 | 5,906,839,891.29 | 6,593,396,615.03 | 4,444,550,727.80 |
| Other business | 42,113,024.41 | 19,926,004.47 | 32,067,506.31 | 21,858,354.58 |
| Total | 8,544,440,154.30 | 5,926,765,895.76 | 6,625,464,121.34 | 4,466,409,082.38 |
| Contract classification | Division 1 | Division 2 | Total | |
| Including: | ||||
| Including: | ||||
| Including: | ||||
| Including: | ||||
| Including: | ||||
| Including: | ||||
| Including: |
Information relating to the transaction price allocated to the remaining performance obligation:
At the end of this report period, the amount of income corresponding to the performance obligations that have been signed but not yetfulfilled or not fulfilled is RMB 72,490,372.55 , of which RMB72,490,372.55 is expected to be recognized in 2021, RMBXXX isexpected to be recognized in XX year, and RMBXXX is expected to be recognized in XX year.Other instructions:
62、Taxes and surcharges
Currency: RMB
| Items | Year 2020 | Year 2019 |
| Urban maintenance and construction tax | 4,786,192.59 | 5,282,355.41 |
| Education surcharge | 2,328,932.48 | 3,060,211.28 |
| Housing property tax | 9,890,480.39 | 8,648,352.52 |
| Land use tax | 2,147,547.54 | 1,878,108.28 |
| Vehicle and vessel use tax | 76,767.27 | 63,373.44 |
| stamp duty | 6,480,368.19 | 5,070,990.89 |
| Environmental protection tax | 5,877.90 | 9,038.89 |
| Local education surcharge | 1,552,621.56 | 1,994,285.24 |
| Total | 27,268,787.92 | 26,006,715.95 |
| Items | Year 2020 | Year 2019 |
| Freight | 196,231,527.72 | |
| Salary expenses | 231,285,600.62 | 180,957,999.36 |
| Advertising and promotion expenses | 158,061,292.72 | 145,525,153.82 |
| Commodity inspection expenses | 8,444,517.79 | 11,144,670.48 |
| Consulting expenses | 12,398,145.37 | 13,964,331.69 |
| Business travelling expenses | 5,765,621.94 | 11,132,208.73 |
| Office expenses | 15,027,354.08 | 11,413,428.55 |
| Depreciation and amortization | 18,604,834.71 | 4,360,224.30 |
| House rents | 2,114,137.78 | 3,416,279.94 |
| Insurance premium | 4,367,937.54 | 6,840,190.46 |
| Others | 2,204,966.10 | 1,982,045.21 |
| Total | 458,274,408.65 | 586,968,060.26 |
| Items | Year 2020 | Year 2019 |
| Salary expenses | 317,985,417.88 | 296,207,553.44 |
| Consulting expenses | 51,273,959.59 | 45,605,468.63 |
| Depreciation and amortization | 47,961,742.13 | 33,366,040.94 |
| Office expenses | 52,019,821.23 | 64,135,981.39 |
| Business travelling expenses | 9,814,116.43 | 17,179,389.50 |
| Business entertainment expenses | 2,865,337.49 | 4,299,127.71 |
| Taxes and rates | 2,714,181.92 | 2,324,271.22 |
| Afforestation expenses | 2,989,803.38 | 2,313,624.36 |
| Others | 13,375,557.95 | 12,273,771.90 |
| Total | 500,999,938.00 | 477,705,229.09 |
| Items | Year 2020 | Year 2019 |
| Salary expenses | 129,218,589.63 | 110,819,842.28 |
| Direct input | 87,654,200.47 | 70,233,182.98 |
| Depreciation and amortization | 13,190,352.70 | 9,866,890.56 |
| Others | 15,308,926.56 | 12,852,821.02 |
| Total | 245,372,069.36 | 203,772,736.84 |
| Items | Year 2020 | Year 2019 |
| Interest expenditures | 69,915,383.28 | 48,674,516.53 |
| Interest income | -58,134,194.43 | -50,223,558.70 |
| Gains on foreign exchange | 94,969,455.21 | -50,865,687.86 |
| Bank handling charges | 6,829,360.99 | 13,357,218.42 |
| Total | 113,580,005.05 | -39,057,511.61 |
| Items | Year 2020 | Year 2019 |
| Government grants related to assets | 1,196,922.60 | 1,196,922.54 |
| Government grants related to income | 32,022,952.51 | 74,700,248.24 |
| Refund of handling fees for withholding individual income tax | 267,035.13 | 28,040.91 |
| Total | 33,486,910.24 | 75,925,211.69 |
| [note] for the government subsidies included in other income in the current period, please refer to section XII (7) 84, government grants |
| Items | Year 2020 | Year 2019 |
| Investment income from long-term equity investments under equity method | 260,530,217.44 | 65,458,417.14 |
| Gains on disposal of long-term equity investments | 266,783.83 | |
| Investment income from financial instruments | 1,792,735.16 | 4,763,145.26 |
| Gains on disposal of financial assets | 30,314,376.80 | 5,172,650.57 |
| Other equity instrument investments | 3,647,177.70 | |
| Total | 296,551,290.93 | 75,394,212.97 |
| Items | Year 2020 | Year 2019 |
70、Gains on changes in fair value
Currency: RMB
| Items | Year 2020 | Year 2019 |
| Held-for-trading financial assets | 31,920,861.95 | 8,154,053.98 |
| Including: Gains on changes in fair value arising from derivative financial instruments | 31,510,730.07 | 5,918,543.91 |
| Transaction financial liabilities | ||
| Total | 31,920,861.95 | 8,154,053.98 |
| Items | Year 2020 | Year 2019 |
| Bad debt loss of other receivables | -2,272,889.16 | -154,012.46 |
| Bad debt loss of receivables financing | -14,269,832.52 | -2,003,619.78 |
| Bad debt loss of accounts receivable | -10,705,040.96 | 1,124,713.50 |
| Bad debt loss of prepayment | -884,081.80 | 462,593.98 |
| Total | -28,131,844.44 | -570,324.76 |
| Items | Year 2020 | Year 2019 |
| Inventory write-down loss | -22,641,151.52 | -12,687,343.31 |
| Impairment loss of long-term equity investments | -2,977,272.88 | |
| Impairment loss of goodwill | -70,843,415.48 | -444,527.83 |
| Total | -93,484,567.00 | -16,109,144.02 |
| Items | Year 2020 | Year 2019 |
| Gains on disposal of fixed assets | -300,665.75 | -996,941.48 |
| Total | -300,665.75 | -996,941.48 |
| Items | Year 2020 | Year 2019 | Amount included in non-recurring profit or loss |
| Gains on donations | 221,786.41 | 221,786.41 | |
| Fund unable to pay | 615,523.56 | 495,643.79 | 615,523.56 |
| Indemnity income | 529,703.60 | 1,501,350.01 | 529,703.60 |
| Others | 85,532.84 | 900,890.12 | 85,532.84 |
| Gains on damage or retirement of non-current assets | 83,056.95 | 83,056.95 | |
| Negative goodwill arising from business combination | 53,341,459.79 | 53,341,459.79 | |
| Total | 54,877,063.15 | 2,897,883.92 | 54,877,063.15 |
| Items | Entity | Reason | nature | Grants affected current net profit or not | Special grants or not | Current amount | Previous period amount | Related to assets/Related to profit or loss |
| Items | Year 2020 | Year 2019 | Amount included in non-recurring profit or loss |
| Donation expenditures | 709,875.68 | 1,793,606.43 | 709,875.68 |
| Penalty expenditures | 1,076,247.57 | 233,559.56 | 1,076,247.57 |
| Losses on damage or retirement of non-current assets | 738,005.09 | 1,124,360.64 | 738,005.09 |
| Others | 299,222.37 | 43,788.27 | 299,222.37 |
| Total | 2,823,350.71 | 3,195,314.90 | 2,823,350.71 |
| Items | Year 2020 | Year 2019 |
| Current period income tax expenses | 187,284,921.29 | 140,238,835.60 |
| Deferred income tax expenses | 12,495,238.20 | 1,267,569.14 |
| Total | 199,780,159.49 | 141,506,404.74 |
| Items | Year 2020 |
| Profit before tax | 1,564,274,747.93 |
| Income tax expenses based on tax rate applicable to the parent company | 234,641,212.19 |
| Effect of different tax rate applicable to subsidiaries | 20,897,131.68 |
| Effect of prior income tax reconciliation | 1,383,125.41 |
| Effect of non-taxable income | -25,118,386.73 |
| Effect of non-deductible costs, expenses and losses | 22,904,340.64 |
| Utilization of deductible losses not previously recognized as deferred tax assets | -14,552,095.64 |
| Effect of investment from long-term equity investments under equity method | -39,084,312.41 |
| Effect of deducible temporary differences or deductible losses not recognized as deferred tax assets | 29,157,244.95 |
| Effect of additional deduction of technology development fees and | -30,448,100.60 |
| wages for disabled employees | |
| Income tax expenses | 199,780,159.49 |
| Items | Year 2020 | Year 2019 |
| Redemption of deposit for bank acceptance | 10,786,677.30 | 14,512,250.00 |
| Interest income | 49,046,349.09 | 40,477,552.57 |
| Government grants | 28,810,242.20 | 71,361,429.25 |
| Operating leases revenue | 15,020,862.01 | 13,313,715.14 |
| Redemption of deposit for L/G | 300,000.00 | 200,000.00 |
| Others | 5,313,974.96 | 3,290,932.05 |
| Total | 109,278,105.56 |
| Items | Year 2020 | Year 2019 |
| Operating period expenses | 624,751,673.57 | 589,096,752.65 |
| Deposit for bank acceptance | 14,267,400.00 | 4,626,677.30 |
| Other security deposits | 4,851,527.75 | |
| Others | 7,594,720.20 | 3,389,348.09 |
| Total | 646,613,793.77 |
| Items | Year 2020 | Year 2019 |
| Redemption of deposit for forward foreign | 47,484,154.96 |
| exchange settlement | ||
| Redemption of deposited investments | 22,822,339.65 | 2,924,946.15 |
| Total | 22,822,339.65 | 50,409,101.11 |
| Items | Year 2020 | Year 2019 |
| Deposited investments | 2,154,766.92 | 22,822,339.65 |
| Deposit for purchase of forward foreign exchange settlement | 3,295,074.50 | |
| Payment of deposit for land purchase | 20,325,841.02 | |
| Payment of project performance bond | 495,608.89 | |
| Investment losses on forward foreign exchange settlement | 1,253,349.80 | |
| Payment of deposit for equity purchase | 5,000,000.00 | |
| Total | 26,271,291.33 |
| Items | Year 2020 | Year 2019 |
| Receipt of notes receivable discounting | 289,290,000.00 | |
| Redemption of pledged deposit for borrowings | 20,910,744.60 | |
| Redemption of deposit for L/C | 1,800,000.00 | |
| Redemption of deposit for notes | 300,000,000.00 | |
| Receipt of call loans | 15,512,811.43 | |
| Total | 315,512,811.43 | 312,000,744.60 |
| Items | Year 2020 | Year 2019 |
| Payment of deposit for notes payable for discounting | 300,000,000.00 | |
| Repayment of Lista Holding AG for lease liabilities and interest | 30,545,009.60 | 29,413,997.10 |
| Repayment of Prime-Line Products, LLC for finance lease payable | 976,686.29 | 1,310,763.00 |
| Payment for share repurchase | 5,500,089.23 | |
| Payment for handling charges of financing L/G and transfer of receivables financing | 7,997,070.51 | 8,873,702.03 |
| Repayment of call loans and interest | 83,737.50 | |
| Expenses for the issuance of convertible bonds | 6,606,505.30 | 474,528.29 |
| Total | 46,125,271.70 |
| Supplement information | Year 2020 | Year 2019 |
| 1) Reconciliation of net profit to cash flow from operating activities: | ||
| Net profit | 1,364,494,588.44 | 903,653,041.09 |
| Add: Provision for assets impairment loss | 121,616,411.44 | 16,679,468.78 |
| Depreciation of fixed assets, oil and gas assets, productive biological assets | 156,514,773.41 | 142,551,218.08 |
| Amortization of intangible assets | 18,637,144.15 | 16,740,404.35 |
| Amortization of long-term prepayments | 5,374,280.54 | 2,301,359.85 |
| Loss on disposal of fixed assets, intangible assets and other long-term assets (Less: gains) | 300,665.75 | 996,941.48 |
| Fixed assets retirement loss (Less: gains) | 654,948.14 | 1,124,360.64 |
| Losses on changes in fair value (Less: gains) | -31,920,861.95 | -8,154,053.98 |
| Supplement information | Year 2020 | Year 2019 |
| Financial expenses (Less: gains) | 166,307,558.92 | -2,191,171.33 |
| Investment losses (Less: gains) | -296,551,290.93 | -75,394,212.97 |
| Decrease of deferred tax assets (Less: increase) | -21,676,277.78 | -19,423,337.86 |
| Increase of deferred tax liabilities (Less: decrease) | 35,300,639.39 | 29,157,665.24 |
| Decrease of inventories (Less: increase) | -174,121,514.47 | -119,500,913.26 |
| Decrease of operating receivables (Less: increase) | -408,964,409.46 | -302,637,230.59 |
| Increase of operating payables (Less: decrease) | -126,332,561.45 | 240,054,076.48 |
| Others | -38,483,468.90 | -16,070,492.40 |
| Net cash flows from operating activities | 771,150,625.24 | 809,887,123.60 |
| 2) Significant investing and financing activities not related to cash receipts and payments: | ||
| Conversion of debt into capital | ||
| Convertible bonds due within one year | ||
| Fixed assets leased in under finance leases | ||
| 3) Net changes in cash and cash equivalents: | ||
| Cash at the end of the period | 3,730,263,218.08 | 2,127,457,447.34 |
| Less: Cash at the beginning of the period | 2,127,457,447.34 | 2,441,696,243.74 |
| Add: Cash equivalents at the end of the period | ||
| Less: Cash equivalents at the beginning of the period | ||
| Net increase of cash and cash equivalents | 1,602,805,770.74 | -314,238,796.40 |
| Items | Year 2020 |
| Cash and cash equivalents paid in current period as consideration for business combination in current period | 55,000,000.00 |
| Including: | -- |
| Suzhou Xindadi Hardware Product Co., Ltd. and its subsidiaries | 55,000,000.00 |
| Less: Cash and cash equivalents held by subsidiaries at the acquisition date | 15,901,174.16 |
| Including: | -- |
| Suzhou Xindadi Hardware Product Co., Ltd. and its subsidiaries | 15,901,174.16 |
| Including: | -- |
| Net cash payment for acquisition of subsidiaries in current period | 39,098,825.84 |
| Amount | |
| Including: | -- |
| Including: | -- |
| Including: | -- |
| Items | Closing balance | Opening balance |
| 1) Cash | 3,730,263,218.08 | 2,127,457,447.34 |
| Including: Cash on hand | 2,874,834.15 | 682,285.42 |
| Cash in bank on demand for payment | 3,722,569,979.24 | 2,126,269,850.32 |
| Other cash and bank balances on demand for payment | 4,818,404.69 | 505,311.60 |
| 3) Cash and cash equivalents at the end of the period | 3,730,263,218.08 | 2,127,457,447.34 |
| Items | Year 2020 | Year 2019 |
| Amount of endorsed commercial acceptance | 17,737,253.70 | 18,847,233.26 |
| Including: Payment for goods | 17,737,253.70 | 18,847,233.26 |
80、Notes to items in statement of changes in owner's equityExplain the name of "other" items and the amount of adjustment for the balance at the end of last year
81、Assets with title or use right restrictions
Currency: RMB
| Items | Closing carrying amount | Reasons for restrictions |
| Cash and bank balances | 14,267,400.00 | Deposit for bank acceptance |
| Cash and bank balances | 2,154,766.92 | Deposited investments |
| Cash and bank balances | 3,295,074.50 | Deposit for forward foreign exchange settlement |
| Cash and bank balances | 495,608.89 | Project performance bond |
| Cash and bank balances | 30,000.00 | Deposit for ETC |
| Accounts receivable | 18,342,218.60 | Pledged for bank borrowings |
| Fixed assets | 11,803,478.08 | Mortgaged for bank borrowings |
| Fixed assets | 31,664,662.87 | Mortgaged for bank acceptance |
| Intangible assets | 3,075,032.85 | Mortgaged for bank borrowings |
| Intangible assets | 2,174,573.65 | Mortgaged for bank acceptance |
| 100% equity of Arrow Fastener Co., LLC [Note] | 443,085,633.62 | Pledged for bank borrowings |
| Total | 530,388,449.98 |
| Items | Closing balance in foreign currencies | Exchange rate | RMB equivalent at the end of the period |
| Cash and bank balances | 1,101,880,409.83 | ||
| Including: VND | 19,015,250,200.00 | 0.0002815 | 5,352,792.93 |
| USD | 141,131,886.04 | 6.5249 | 920,871,443.22 |
| JPY | 102,066,536.00 | 0.0632360 | 6,454,279.47 |
| EUR | 2,243,515.73 | 8.0250 | 18,004,213.73 |
| HKD | 4,832,402.72 | 0.8416 | 4,066,950.13 |
| CHF | 12,668,819.66 | 7.4006 | 93,756,866.78 |
| CAD | 6,047,819.03 | 5.1161 | 30,941,246.94 |
| KHR | 4,058,000.00 | 0.0016198 | 6,573.15 |
| THB | 102,926,574.57 | 0.2178839 | 22,426,043.48 |
| Accounts receivable | 1,169,139,502.15 | ||
| Including: USD | 166,128,111.84 | 6.5249 | 1,083,969,316.94 |
| EUR | 172,325.78 | 8.0250 | 1,382,914.38 |
| HKD | |||
| VND | 11,109,555,000.00 | 0.0002815 | 3,127,339.73 |
| JPY | 32,711,614.97 | 0.0632360 | 2,068,551.68 |
| CHF | 10,619,595.63 | 7.4006 | 78,591,379.42 |
| Receivables financing | 385,734,943.17 | ||
| Including: USD | 59,117,372.40 | 6.5249 | 385,734,943.17 |
| Non-current assets due within one year | 90,583.31 | ||
| Including: EUR | 11,287.64 | 8.0250 | 90,583.31 |
| Long-term receivables | 2,866,819.08 | ||
| Including: EUR | 71,801.32 | 8.0250 | 576,205.61 |
| VND | 8,136,030,000.00 | 0.0002815 | 2,290,613.47 |
| Short-term borrowings | 559,756,077.01 | ||
| Including: USD | 85,787,686.71 | 6.5249 | 559,756,077.01 |
| Accounts payable | 282,000,487.34 | ||
| Including: USD | 31,691,667.90 | 6.5249 | 206,784,963.88 |
| HKD | 12,556,332.91 | 0.8416 | 10,567,409.78 |
| EUR | 73,999.84 | 8.0250 | 593,848.72 |
| CHF | 5,965,482.86 | 7.4006 | 44,148,152.45 |
| JPY | 2,214,051.96 | 0.0632360 | 140,007.79 |
| THB | 68,858,404.54 | 0.2178839 | 15,003,137.73 |
| VND | 16,919,953,800.00 | 0.0002815 | 4,762,966.99 |
| Non-current liabilities due within one year | 148,128,700.04 | ||
| Including: EUR | 18,458,404.99 | 8.0250 | 148,128,700.04 |
| Long-term borrowings | -- | -- | 288,719,360.11 |
| Including: USD | |||
| EUR | 35,767,381.36 | 8.0250 | 287,033,235.41 |
| HKD | |||
| JPY | 26,664,000.00 | 0.0632360 | 1,686,124.70 |
| Lease liabilities | 246,303,999.08 | ||
| Including: CHF | 33,281,625.69 | 7.4006 | 246,303,999.08 |
| Long-term payables | 1,499,174.07 | ||
| Including: USD | 229,762.00 | 6.5249 | 1,499,174.07 |
| Entities | Main operating place | Functional currency |
| Hong Kong Great Star International Co., Ltd. | Hong Kong | USD |
| HongKong Goldblatt Industrial Co.,Ltd | Hong Kong | USD |
| Prim' Tools Limited | Hong Kong | HKD |
| Great Star Industrial USA,LLC | USA | USD |
| Great Star Tools USA,Inc | USA | USD |
| Arrow Fastener Co., LLC | USA | USD |
| Prime-Line Products, LLC | USA | USD |
| Great Star Japan Co.,Ltd | Japan | JPY |
| GreatStar Europe AG | Switzerland | CHF |
| Prexiso AG | Switzerland | CHF |
| Lista Holding AG | Switzerland | CHF |
| Lista AG | Switzerland | CHF |
| Thur Metall AG | Switzerland | CHF |
| Lista GmbH | Germany | EUR |
| Lista (UK) Ltd. | UK | GBP |
| Lista Sistemas de Almacenaje S.A. | Spain | EUR |
| Lista Italia s.r.l. | Italy | EUR |
| Lista Austria GmbH | Austria | EUR |
| Lista France S.A. | France | EUR |
| Huni Italiana Spa | Italy | EUR |
| Eudura Holding Limited | Hong Kong | USD |
| Great Star Vietnam Co.,Ltd | Vietnam | VND |
| GreatStar International Holdings Limited | The British Virgin Islands | USD |
| Newland XDD(Thailand) Co .,Ltd | Thailand | THB |
| Vietnam United Co.,Ltd | Vietnam | VND |
| 4900 Highlands Parkway,LLC | USA | USD |
| Hangzhou Equipment Holdings,LLC | USA | USD |
| TGH(Cambodia)Industrial Co.,LTD | Cambodia | USD |
| XDD Products(USA) LLC | USA | USD |
| Newland.LLC | USA | USD |
| Hong Kong International Huada Kejie Opto-Electro Instrument Co., Ltd. | Hong Kong | USD |
| Items | Closing balance of deferred income | Amortization presented under | Amortization |
| Special subsidy for foreign trade public service platform construction | 1,079,222.14 | Other income | 442,666.68 |
| Special subsidy for “substituting machine for human” technical transformation project | 1,355,664.75 | Other income | 276,700.32 |
| Special subsidy for strategic emerging industries equipment manufacturing projects | 919,999.76 | Other income | 230,000.04 |
| Financial subsidy for capacity expansion project of novel hand tool series products | 260,000.20 | Other income | 99,999.96 |
| Special subsidy for provincial | 101,851.82 | Other income | 55,555.56 |
| enterprise technology center innovation capacity construction project | |||
| Special fund for strategic emerging industries development pilot project and base construction | 275,999.92 | Other income | 92,000.04 |
| Subtotal | 3,992,738.59 | 1,196,922.60 |
| Items | Amounts | Presented under | Remarks |
| R&D financial subsidy fund | 10,404,300.00 | Other income | Pursuant to the documents numbered Zhe Cai Ke Jiao [2019] 48, Hang Ke Ji [2019] 151, Zhe Cai Ke Jiao [2020] 4 |
| Tax refund | 3,212,710.31 | Other income | Pursuant to the document numbered Cai Shui [2016] 52 |
| Financial special fund | 2,904,490.00 | Other income | Pursuant to the documents numbered Hang Cai Jiao [2020] 16, Hang Cai Qi [2020] 56, etc. |
| Subsidy for stabilizing employment | 2,858,625.17 | Other income | Pursuant to the documents numbered Hang Zheng Han [2019] 19, Hang Ren She Fa [2020] 94, etc. |
| Social insurance premium refund | 2,638,695.27 | Other income | Pursuant to the document numbered Hang Zheng Han [2019] 19 |
| Business development fund | 2,285,638.44 | Other income | Pursuant to the documents numbered Xiang Shang [2020] 64, Jiang Cai Fa [2020] 80, etc. |
| E-commerce special supporting fund | 2,143,400.00 | Other income | Pursuant to the documents numbered Hang Cai Qi [2020] 25, Hang Cai Qi [2019] 84, etc. |
| Patent and intellectual property fund | 1,472,600.00 | Other income | Pursuant to the documents numbered Hang Cai Xing [2019] 23 and Zhe Cai Xing [2020] 14 |
| Export credit insurance subsidy | 1,000,000.00 | Other income | Pursuant to the document numbered Jiang Cai Fa [2020] 46 |
| Industry supporting policy fund | 877,000.00 | Other income | Pursuant to the document numbered Pu Cai Fu Xuan Qiao [2018] 00060 |
| Subsidy for outstanding enterprises | 595,000.00 | Other income | Pursuant to the documents numbered Hang Shang Wu [2019] 188, etc. |
| Standardization project fund | 108,000.00 | Other income | Pursuant to the document numbered Hang Shi Guan [2019] 206 |
| Others | 1,522,493.32 | Other income | |
| Subtotal | 32,022,952.51 |
| Acquirees | Equity acquisition date | Equity acquisition cost | Proportion of equity acquired (%) | Equity acquisition method |
| Suzhou Xindadi Hardware Product Co., Ltd. and its subsidiaries [Note] | 2/28/2020 | 60,000,000.00 | 60.00 | Equity transfer agreement |
| Acquirees | Acquisition date | Determine basis for acquisition date | Acquiree’s income from acquisition date to period end | Acquiree’s net profit from acquisition date to period end |
| Suzhou Xindadi Hardware Product Co., Ltd. and its subsidiaries | 2/28/2020 | Transfer of control right | 251,552,041.79 | 15,920,574.08 |
| Name | Holding proportion (%) |
| Newland. LLC | 100.00 |
| XDD Products (USA) LLC | 100.00 |
| TGH (Cambodia) Industrial Co., Ltd. | 100.00 |
| 苏州钮蓝得进出口有限公司 (Suzhou New Land Import&Export Co., Ltd.) | 100.00 |
| 法兰帝厨卫（苏州）有限公司 (Falandi Kitchen and Bath (Suzhou) Co., Ltd.) | 75.00 |
| Combination costs | |
| Cash | 60,000,000.00 |
| Total combination costs | 60,000,000.00 |
| Less: Share of fair value of net identifiable assets acquired | 17,711,391.70 |
| Goodwill/combination costs excess the fair value of identifiable net assets | 42,288,608.30 |
| Acquisition-date fair value | Acquisition-date carrying amount | |
| Cash and bank balances | 22,061,174.16 | 22,061,174.16 |
| Accounts receivable | 20,782,846.84 | 20,782,846.84 |
| Inventories | 38,427,191.96 | 38,427,191.96 |
| Fixed assets | 24,613,816.84 | 24,613,816.84 |
| Intangible assets | 2,828,314.83 | 2,828,314.83 |
| Prepaid expenses | 4,806,947.79 | 4,806,947.79 |
| Other receivables | 1,638,708.39 | 1,638,708.39 |
| Other current assets | 2,537,681.02 | 2,537,681.02 |
| Long-term prepayments | 1,339,737.91 | 1,339,737.91 |
| Deferred tax assets | 1,129,123.41 | 1,129,123.41 |
| Short-term borrowings | 45,000,000.00 | 45,000,000.00 |
| Accounts payable | 26,890,727.03 | 26,890,727.03 |
| Notes payable | 9,650,000.00 | 9,650,000.00 |
| Contract liabilities | 4,778,413.52 | 4,778,413.52 |
| Employee compensation payable | 773,220.55 | 773,220.55 |
| Other payables | 4,116,730.73 | 4,116,730.73 |
| Net assets | 28,956,451.32 | 28,956,451.32 |
| Less:non-controlling interest | -562,534.85 | -562,534.85 |
| Total equity attributable to the parent company | 28,956,451.32 | 28,956,451.32 |
The fair value determination method of identifiable assets and liabilities:
The contingent liabilities of the acquirees assumed in the business combination:
Other instructions:
（4）Gain/loss of equity held prior to acquisition-date remeasured at fair value
If exists any business combination achieved in stages and gain control during the reporting period or not
□ Yes √ No
（5）Related instructions on that cannot reasonably determine the combination consideration or the fairvalue of the acquiree’s identifiable assets and liabilities at the acquisition date or at the end of the acquisitionperiod.
（6）Other instructions
2、Business combination under common control
（1）Business combination under common control in current period
Currency: RMB
| combined party | Proportion of equity arising from business combination | determination basis of business combination under common control | combination date | determination method of combination date | revenue of the combined party from beginning of the combination to the combination date | Net profit of the combined party from beginning of the combination to the combination date | revenue of the combined party during the Comparison Period | Net profit of the combined party during the Comparison Period |
| combination cost |
| combination date | End of previous period |
| Entities | Equity acquisition method | Equity acquisition date | Capital contribution | Capital contribution proportion |
| Newland XDD (Thailand) Co., Ltd. | Set up | 2/20/2020 | THB 561,867,109.16 | 100.00% |
| Hong Kong International Huada Kejie Opto-Electro Instrument Co., Ltd. | Set up | 7/22/2020 | HKD 500,000.00 | 65.00% |
| 4900 Highlands Parkway, LLC | Set up | 8/12/2020 | [Note] | 100.00% |
| Vietnam United Co., Ltd. | Set up | 9/21/2020 | USD 5,000,000.00 | 100.00% |
| Hangzhou Great Star Opto-electronics Technology Co., Ltd. | Set up | 9/25/2020 | [Note] | 100.00% |
| Guangdong ShopVac Electrical Appliances Co., Ltd. | Set up | 12/4/2020 | RMB 50,000,000.00 | 100.00% |
| Hangzhou Equipment Holdings, LLC | Set up | 12/6/2020 | [Note] | 100.00% |
Note: As of the balance sheet date, the Company has not paid in capital contribution in Hangzhou Great Star Opto-electronicsTechnology Co., Ltd., and Great Star Tools USA, Inc has not paid in capital contribution in 4900 Highlands Parkway, LLC andHangzhou Equipment Holdings, LLC
2. Entities excluded from the consolidation scope
| Entities | Equity disposal method | Equity disposal date | Disposal-date net assets | Net profit from the period beginning to the disposal date |
| Zhejiang GreatStar Industrial Co., Ltd. | Absorbing merge [Note] | 2/28/2020 | 152,533,209.73 | -6,498,896.35 |
| Subsidiaries | Main operating place | Place of registration | Business nature | Holding proportion (%) | Acquisition method | |
| Direct | Indirect | |||||
| Longyou Yiyang Forging Co., Ltd. | Longyou, Zhejiang | Longyou, Zhejiang | Manufacturing | 55.0833 | 30.0942 | Business combination not under common control |
| Hangzhou GreatStar Sheffield Tools Co., Ltd. | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Commerce | 66.00 | Set up | |
| Hangzhou United Electric Manufacture Co., Ltd. | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Manufacturing | 83.71 | Business combination under common control | |
| Changzhou Huada Kejie Opto-electro Instrument Co., Ltd. | Changzhou, Jiangsu | Changzhou, Jiangsu | Manufacturing | 65.00 | Business combination not under common control | |
| Changzhou Huada Kejie Engineering Machinery Co., Ltd. | Changzhou, Jiangsu | Changzhou, Jiangsu | Manufacturing | 61.75 | Business combination not under common control | |
| Hangzhou GreatStar Intelligent Technology Co., Ltd. | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Manufacturing | 100.00 | Set up | |
| Hangzhou Chongte Robot Technology Co., Ltd. | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Manufacturing | 77.50 | Set up | |
| Subsidiaries | Main operating place | Place of registration | Business nature | Holding proportion (%) | Acquisition method | |
| Direct | Indirect | |||||
| Hangzhou Ole-Systems Co., Ltd. | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Manufacturing | 48.00 | Set up | |
| Hangzhou United Tools Co., Ltd. | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Manufacturing | 100.00 | Set up | |
| Hangzhou GreatStar Sheffield Trading Co., Ltd. | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Commerce | 100.00 | Set up | |
| Hangzhou Great Star Craftsman Tools Co., Ltd. | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Commerce | 100.00 | Set up | |
| Ningbo Fenghua Great Star Tools Co., Ltd. | Fenghua, Zhejiang | Fenghua, Zhejiang | Manufacturing | 100.00 | Business combination under common control | |
| Zhejiang Guoxin Tools Co., Ltd. | Ruian, Zhejiang | Ruian, Zhejiang | Manufacturing | 66.933 | Business combination not under common control | |
| Zhejiang Great Star Tools Co., Ltd. | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Manufacturing | 100.00 | Set up | |
| Hangzhou Juye Tools Co., Ltd. | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Service | 100.00 | Set up | |
| Hangzhou Great Star Tools Co., Ltd. | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Manufacturing | 100.00 | Business combination under common control | |
| Hangzhou United Precision Tool Company | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Manufacturing | 72.00 | Business combination under common control | |
| Prim’ Tools Limited | Hong Kong | Hong Kong | Commerce | 86.96 | Business combination not under common control | |
| Dongguan Ouda Electronics Ltd. | Dongguan, Guangdong | Dongguan, Guangdong | Manufacturing | 86.96 | Business combination not under common control | |
| Great Star Industrial USA, LLC | United States | United States | Commerce | 100.00 | Set up | |
| Hong Kong Great Star International Co., Ltd. | Hong Kong | Hong Kong | Commerce | 100.00 | Set up | |
| Hong Kong Goldblatt Industrial Co., Ltd. | Hong Kong | Hong Kong | Commerce | 100.00 | Set up | |
| Great Star Japan Co., Ltd. | Japan | Japan | Commerce | 66.67 | Set up | |
| Great Star Tools USA, Inc | United States | United States | Commerce | 100.00 | Set up | |
| Arrow Fastener Co., LLC | United States | United States | Manufacturing | 100.00 | Business combination not under common control | |
| Hangzhou Lianhe Machinery Co., Ltd. | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Manufacturing | 100.00 | Business combination under common control | |
| Subsidiaries | Main operating place | Place of registration | Business nature | Holding proportion (%) | Acquisition method | |
| Direct | Indirect | |||||
| Zhejiang Great Star Intelligent Tools Co., Ltd. | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Manufacturing | 100.00 | Set up | |
| Longyou Hugong Forging Three Tools Co., Ltd. | Longyou, Zhejiang | Longyou, Zhejiang | Manufacturing | 67.00 | Business combination not under common control | |
| Zhe Jiang Yiyang Tool Manufacture Co., Ltd. | Longyou, Zhejiang | Longyou, Zhejiang | Manufacturing | 67.00 | Business combination not under common control | |
| Longyou Yiyang Import and Export Co., Ltd. | Longyou, Zhejiang | Longyou, Zhejiang | Commerce | 67.00 | Set up | |
| GreatStar Europe AG | Switzerland | Switzerland | Commerce | 100.00 | Set up | |
| Prexiso AG | Switzerland | Switzerland | Commerce | 100.00 | Business combination not under common control | |
| Lista Holding AG | Switzerland | Switzerland | Manufacturing | 100.00 | Business combination not under common control | |
| Lista AG | Switzerland | Switzerland | Manufacturing | 100.00 | Business combination not under common control | |
| Thur Metall AG | Switzerland | Switzerland | Manufacturing | 100.00 | Business combination not under common control | |
| Lista GmbH | Germany | Germany | Manufacturing | 100.00 | Business combination not under common control | |
| Lista (UK) Ltd. | United Kingdom | United Kingdom | Commerce | 100.00 | Business combination not under common control | |
| Lista Sistemas de Almacenaje S.A. | Spain | Spain | Commerce | 100.00 | Business combination not under common control | |
| Lista Italia s.r.l. | Italy | Italy | Manufacturing | 100.00 | Business combination not under common control | |
| Lista Austria GmbH | Austria | Austria | Commerce | 100.00 | Business combination not under common control | |
| Lista France S.A. | France | France | Commerce | 100.00 | Business combination not under common control | |
| Huni Italiana Spa | Italy | Italy | Commerce | 100.00 | Business combination not | |
| Subsidiaries | Main operating place | Place of registration | Business nature | Holding proportion (%) | Acquisition method | |
| Direct | Indirect | |||||
| under common control | ||||||
| Prexiso Laser Measuring Tools (Hangzhou) Co., Ltd. | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Manufacturing | 51.00 | Set up | |
| Eudura Holding Limited | Hong Kong | Hong Kong | Commerce | 100.00 | Business combination not under common control | |
| Shanghai Endura Tools Co., Ltd. | Shanghai | Shanghai | Manufacturing | 100.00 | Business combination not under common control | |
| Great Star Vietnam Co., Ltd. | Vietnam | Vietnam | Manufacturing | 100.00 | Set up | |
| GreatStar International Holdings Limited | British Virgin Islands | British Virgin Islands | Commerce | 100.00 | Set up | |
| Haining Great Star Intelligent Equipment Co., Ltd. | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Manufacturing | 100.00 | Set up | |
| Haining Great Star Hardware Tools Co., Ltd. | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Manufacturing | 100.00 | Set up | |
| Prime-Line Products, LLC | United States | United States | Manufacturing | 100.00 | Business combination not under common control | |
| Hangzhou Great Star Opto-electronics Technology Co., Ltd. | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Manufacturing | 100.00 | Set up | |
| Guangdong ShopVac Electrical Appliances Co., Ltd. | Shenzhen, Guangdong | Shenzhen, Guangdong | Manufacturing | 100.00 | Set up | |
| Vietnam United Co., Ltd. | Vietnam | Vietnam | Manufacturing | 100.00 | Set up | |
| 4900 Highlands Parkway, LLC | United States | United States | Manufacturing | 100.00 | Set up | |
| Hangzhou Equipment Holdings, LLC | United States | United States | Manufacturing | 100.00 | Set up | |
| Newland XDD (Thailand) Co., Ltd. | Thailand | Thailand | Manufacturing | 98.00 | 2.00 | Set up |
| Hong Kong International Huada Kejie Opto-Electro Instrument Co., Ltd. | Hong Kong | Hong Kong | Commerce | 65.00 | Set up | |
| Suzhou Xindadi Hardware Product Co., Ltd. | Suzhou, Jiangsu | Suzhou, Jiangsu | Manufacturing | 60.00 | Business combination not under common control | |
| Newland. LLC | United States | United States | Commerce | 60.00 | Business combination not under common control | |
| XDD Products (USA) LLC | United States | United States | Commerce | 60.00 | Business combination not under common control | |
| TGH (Cambodia) Industrial Co., Ltd. | Cambodia | Cambodia | Manufacturing | 60.00 | Business combination not under common control | |
| Subsidiaries | Main operating place | Place of registration | Business nature | Holding proportion (%) | Acquisition method | |
| Direct | Indirect | |||||
| Suzhou New Land Import&Export Co., Ltd. | Suzhou, Jiangsu | Suzhou, Jiangsu | Commerce | 60.00 | Business combination not under common control | |
| Falandi Kitchen and Bath (Suzhou) Co., Ltd. | Suzhou, Jiangsu | Suzhou, Jiangsu | Manufacturing | 45.00 | Business combination not under common control | |
| Subsidiaries | Holding proportion of non-controlling shareholders | Non-controlling shareholders’ profit or loss | Dividend declared to non-controlling shareholders | Closing balance of non-controlling interest |
| Longyou Yiyang Forging Co., Ltd. | 14.8225% | 374,862.49 | 7,075,378.31 | |
| Hangzhou GreatStar Sheffield Tools Co., Ltd. | 34.00% | 1,215,227.03 | 354,030.36 | |
| Hangzhou United Electric Manufacture Co., Ltd. | 16.29% | 2,380,195.04 | 26,151,250.60 | |
| Changzhou Huada Kejie Opto-electro Instrument Co., Ltd. | 35.00% | 7,081,132.11 | 89,220,024.46 | |
| Changzhou Huada Kejie Engineering Machinery Co., Ltd. | 33.25% | 34,314.38 | 168,085.87 | |
| Zhejiang Guoxin Tools Co., Ltd. | 33.067% | 286,941.03 | 13,032,018.44 | |
| Hangzhou United Precision Tool Company | 28.00% | 933,288.11 | 7,630,368.97 | |
| Hangzhou Chongte Robot Technology Co., Ltd. | 22.50% | -25,313.39 | -325,053.66 | |
| Hangzhou Ole-Systems Co., Ltd. | 52.00% | -6,497,247.31 | -7,149,973.85 | |
| Prim’ Tools Limited | 13.04% | 2,529,590.09 | 1,471,395.20 | 15,127,846.32 |
| Great Star Japan Co., Ltd. | 33.33% | 226,701.01 | 399,348.45 |
| Subsidiaries | Holding proportion of non-controlling shareholders | Non-controlling shareholders’ profit or loss | Dividend declared to non-controlling shareholders | Closing balance of non-controlling interest |
| Hangzhou Great Star Craftsman Tools Co., Ltd. | -476,662.69 | |||
| Longyou Hugong Forging Three Tools Co., Ltd. | 33.00% | 720,817.57 | 44,020,483.04 | |
| Prexiso Laser Measuring Tools (Hangzhou) Co., Ltd. | 49.00% | -788,818.97 | -1,384,082.37 | |
| Suzhou Xindadi Hardware Product Co., Ltd. | 40.00% | 6,369,019.36 | 17,464,389.27 | |
| Falandi Kitchen and Bath (Suzhou) Co., Ltd. | 55.00% | -1,974.33 | -564,509.19 |
| Subsidiaries | Closing balance | Opening balance | ||||||||||
| Current assets | Non-current assets | Total assets | Current liabilities | Non-current liabilities | Total liabilities | Current assets | Non-current assets | Total assets | Current liabilities | Non-current liabilities | Total liabilities | |
| Longyou Yiyang Forging Co., Ltd. | 27,160,990.23 | 23,320,544.20 | 50,481,534.43 | 6,662,347.88 | 70,717.08 | 6,733,064.96 | 23,076,511.36 | 27,226,499.53 | 50,303,010.89 | 9,380,829.31 | 147,862.80 | 9,528,692.11 |
| Hangzhou GreatStar Sheffield Tools Co., Ltd. | 51,773,170.01 | 677,544.27 | 52,450,714.28 | 51,297,874.41 | 111,574.10 | 51,409,448.51 | 45,530,768.39 | 396,194.79 | 45,926,963.18 | 48,459,894.57 | 48,459,894.57 | |
| Hangzhou United Electric Manufacture Co., Ltd. | 251,570,422.61 | 9,813,269.04 | 261,383,691.65 | 100,461,772.33 | 346,881.88 | 100,808,654.21 | 191,120,086.92 | 9,336,737.06 | 200,456,823.98 | 54,092,613.75 | 404,149.08 | 54,496,762.83 |
| Changzhou Huada Kejie | 256,720,509.75 | 78,381,978.16 | 335,102,487.91 | 98,408,432.31 | 10,303.76 | 98,418,736.07 | 207,572,050.23 | 68,479,359.17 | 276,051,409.40 | 61,362,756.67 | 61,362,756.67 | |
| Opto-electro Instrument Co., Ltd. | ||||||||||||
| Changzhou Huada Kejie Engineering Machinery Co., Ltd. | 12,086,775.90 | 2,925,579.34 | 15,012,355.24 | 11,650,637.85 | 11,650,637.85 | 5,475,297.51 | 3,331,335.43 | 8,806,632.94 | 6,131,203.12 | 6,131,203.12 | ||
| Zhejiang Guoxin Tools Co., Ltd. | 26,613,587.48 | 11,767,196.49 | 38,380,783.97 | 8,468,507.93 | 8,468,507.93 | 22,087,155.88 | 12,530,222.61 | 34,617,378.49 | 5,884,562.38 | 5,884,562.38 | ||
| Hangzhou United Precision Tool Company | 49,572,320.93 | 5,336,042.71 | 54,908,363.64 | 27,486,459.56 | 170,586.36 | 27,657,045.92 | 44,271,810.26 | 3,725,491.42 | 47,997,301.68 | 23,885,290.54 | 193,865.23 | 24,079,155.77 |
| Hangzhou Chongte Robot Technology Co., Ltd. | 19,279.50 | 699,583.35 | 718,862.85 | 1,272,295.83 | 1,272,295.83 | 16,783.47 | 814,583.35 | 831,366.82 | 1,272,295.83 | 1,272,295.83 | ||
| Hangzhou Ole-Systems Co., Ltd. | 13,079,651.53 | 3,115,531.67 | 16,195,183.20 | 29,945,132.91 | 29,945,132.91 | 10,722,665.23 | 4,025,945.80 | 14,748,611.03 | 16,003,854.37 | 16,003,854.37 | ||
| Prim' Tools Limited | 85,971,795.30 | 10,593,060.14 | 96,564,855.44 | 11,249,420.93 | 11,249,420.93 | 92,593,151.66 | 10,881,486.99 | 103,474,638.65 | 11,401,945.21 | 11,401,945.21 | ||
| Dongguan Ouda Electronics Ltd. | 48,144,058.35 | 7,993,913.58 | 56,137,971.93 | 18,119,854.82 | 18,119,854.82 | 46,561,633.26 | 5,796,497.81 | 52,358,131.07 | 23,224,601.26 | 23,224,601.26 |
| Great Star Japan Co.,Ltd | 12,196,971.27 | 241,651.12 | 12,438,622.39 | 9,554,332.61 | 1,686,124.70 | 11,240,457.31 | 13,027,158.98 | 276,718.29 | 13,303,877.27 | 12,762,931.27 | 12,762,931.27 | |
| Longyou Hugong Forging Three Tools Co., Ltd. | 53,299,106.73 | 152,194,721.58 | 205,493,828.31 | 60,396,861.29 | 60,396,861.29 | 91,821,118.16 | 105,001,492.72 | 196,822,610.88 | 60,290,895.41 | 60,290,895.41 | ||
| Zhe Jiang Yiyang Tool Manufacture Co., Ltd. | 58,074,837.24 | 11,650,409.92 | 69,725,247.16 | 24,961,440.33 | 24,961,440.33 | 53,539,585.40 | 12,689,592.61 | 66,229,178.01 | 68,132,453.12 | 68,132,453.12 | ||
| Prexiso Laser Measuring Tools (Hangzhou) Co., Ltd | 4,618,116.08 | 13,044.11 | 4,631,160.19 | 3,474,695.62 | 3,474,695.62 | 3,035,231.39 | 14,970.22 | 3,050,201.61 | 283,902.41 | 283,902.41 | ||
| Longyou Yiyang Import and Export Co., Ltd. | 8,509,003.55 | 5,174.01 | 8,514,177.56 | 6,110,126.74 | 6,110,126.74 | 4,115,180.55 | 2,562.82 | 4,117,743.37 | 2,925,929.49 | 2,925,929.49 | ||
| Suzhou Xindadi Hardware Product Co., Ltd. | 121,344,747.47 | 41,939,808.43 | 163,284,555.90 | 117,936,557.78 | 117,936,557.78 | |||||||
| Newland.LLC | 34,918.46 | 7,914,978.59 | 7,949,897.05 | 7,829,880.00 | 7,829,880.00 | |||||||
| XDD Products (USA) LLC | 21,885,972.39 | 497,665.34 | 22,383,637.73 | 22,339,907.47 | 22,339,907.47 |
| TGH(Cambodia)Industrial Co.,LTD | 81,729,428.83 | 28,631,638.53 | 110,361,067.36 | 92,533,255.69 | 92,533,255.69 | |||||||
| Suzhou New Land Import&Export Co., Ltd. | 57,893,593.26 | 4,843.05 | 57,898,436.31 | 56,326,320.87 | 56,326,320.87 | |||||||
| Falandi Kitchen and Bath (Suzhou) Co., Ltd. | 221,912.64 | 2,147.87 | 224,060.51 | 2,482,097.27 | 2,482,097.27 |
| Subsidiaries | Year 2020 | Year 2019 | ||||||
| Operating revenue | Net profit | Total comprehensive income | Cash flows from operating activities | Operating revenue | Net profit | Total comprehensive income | Cash flows from operating activities | |
| Longyou Yiyang Forging Co., Ltd. | 43,021,270.80 | 2,974,150.69 | 2,974,150.69 | 5,806,203.05 | 46,520,426.20 | 1,445,046.05 | 1,445,046.05 | 4,689,395.23 |
| Hangzhou GreatStar Sheffield Tools Co., Ltd. | 88,562,152.75 | 3,574,197.16 | 3,574,197.16 | 5,543,526.17 | 80,073,386.91 | -3,354,926.64 | -3,354,926.64 | -4,219,141.02 |
| Hangzhou United Electric Manufacture Co., Ltd. | 257,139,844.39 | 14,614,976.29 | 14,614,976.29 | 42,034,246.18 | 264,578,205.44 | 21,796,375.50 | 21,796,375.50 | 40,678,197.60 |
| Changzhou Huada Kejie Opto-electro Instrument Co., Ltd. | 277,741,153.27 | 21,995,099.11 | 21,995,099.11 | 13,311,165.86 | 294,743,453.31 | 32,882,159.52 | 32,882,159.52 | 18,738,725.84 |
| Changzhou Huada Kejie Engineering | 19,514,575.95 | 686,287.57 | 686,287.57 | 1,899,920.43 | 14,582,435.52 | 170,487.06 | 170,487.06 | 19,021.06 |
| Machinery Co., Ltd | ||||||||
| Zhejiang Guoxin Tools Co., Ltd. | 29,089,834.81 | 1,179,459.93 | 1,179,459.93 | 1,451,344.85 | 31,291,596.28 | 865,379.06 | 865,379.06 | 3,102,808.23 |
| Hangzhou United Precision Tool Company | 161,330,008.04 | 3,333,171.81 | 3,333,171.81 | 14,425,485.44 | 68,438,854.44 | 2,205,205.56 | 2,205,205.56 | -20,105.07 |
| Hangzhou Chongte Robot Technology Co., Ltd. | -112,503.97 | -112,503.97 | 2,496.03 | -120,503.93 | -120,503.93 | -5,503.93 | ||
| Hangzhou Ole-Systems Co., Ltd. | 7,172,644.23 | -12,494,706.37 | -12,494,706.37 | -2,394,750.58 | 16,572,674.53 | -11,646,087.62 | -11,646,087.62 | -1,088,489.69 |
| Prim' Tools Limited | 167,093,194.15 | 9,266,042.10 | 4,523,437.66 | 4,068,305.99 | 217,744,775.20 | 9,402,940.22 | 9,402,940.22 | 3,444,823.21 |
| Dongguan Ouda Electronics Ltd. | 108,579,831.16 | 8,884,587.30 | 8,884,587.30 | 2,478,629.98 | 128,350,605.21 | 11,157,108.23 | 11,157,108.23 | 22,868,996.55 |
| Great Star Japan Co.,Ltd | 30,379,749.15 | 680,171.04 | 680,171.04 | 1,424,463.51 | 31,899,562.82 | 692,040.54 | 692,040.54 | -310,245.69 |
| Longyou Hugong Forging Three Tools Co., Ltd. | 119,554,662.11 | 8,565,251.55 | 8,565,251.55 | 53,474,650.10 | 115,131,989.60 | -1,807,338.75 | -1,807,338.75 | -15,085,188.79 |
| Zhe Jiang Yiyang Tool Manufacture Co., Ltd. | 166,153,555.12 | -3,481,206.31 | -3,481,206.31 | -49,049,689.02 | 157,991,239.12 | 376,506.76 | 376,506.76 | 13,658,295.51 |
| Prexiso Laser Measuring Tools (Hangzhou) Co., Ltd. | 1,538,431.17 | -1,609,834.63 | -1,609,834.63 | -1,358,489.30 | 466,329.13 | -1,408,325.85 | -1,408,325.85 | -1,668,167.23 |
| Longyou Yiyang Import and | 25,385,709.22 | 1,212,236.94 | 1,212,236.94 | 1,782,085.30 | 2,660,611.71 | 191,813.88 | 191,813.88 | 458,903.41 |
| Export Co., Ltd. | ||||||||
| Suzhou Xindadi Hardware Product Co., Ltd. | 159,810,266.07 | 2,257,562.52 | 2,257,562.52 | -10,594,936.16 | ||||
| Newland.LLC | 269,540.70 | -163,327.98 | -163,327.98 | -540,825.60 | ||||
| XDD Products (USA) LLC | 44,165,181.77 | -3,271,375.47 | -3,271,375.47 | -248,631.03 | ||||
| TGH(Cambodia)Industrial Co.,LTD | 112,204,067.33 | 13,927,657.29 | 13,927,657.29 | 35,540,904.18 | ||||
| Suzhou New Land Import&Export Co., Ltd. | 67,069,133.36 | -3,568,856.58 | -3,568,856.58 | 8,240,804.18 | ||||
| Falandi Kitchen and Bath (Suzhou) Co., Ltd. | -2,910,941.06 | -2,910,941.06 | -1,604.45 |
| Subsidiaries | Date of change | Holding proportion before change | Holding proportion after change |
| Hangzhou Great Star Craftsman Tools Co., Ltd. | August 2020 | 74.80% | 100.00% |
（2）Effect of transactions on non-controlling interest and equity attributable to parent company
Currency: RMB
| Items | Hangzhou Great Star Craftsman Tools Co., Ltd. |
| Acquisition costs | |
| Cash | |
| Total acquisition costs | |
| Less: Share in subsidiaries’ net assets based on acquired net assets proportion | -1,959,810.76 |
| Balance | -1,959,810.76 |
| Including: Capital reserve adjusted | -1,959,810.76 |
| Associates | Main operating place | Place of registration | Business nature | Holding proportion (%) | Accounting treatment on investments in associates | |
| Direct | Indirect | |||||
| Hangzhou Zhongce Haichao Enterprise Management Co., Ltd. | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Manufacturing | 24.375 | Equity method | |
| Zhejiang Hangcha Holding Co., Ltd. | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Manufacturing | 20.00 | Equity method | |
| Hangzhou Weiming Investment Management Co., Ltd. | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Investment | 30.09 | Equity method | |
| Zhejiang Guozi Robotics Co., Ltd. | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Manufacturing | 21.9469 | Equity method | |
| Ningbo Donghai Bank Co., Ltd. | Ningbo, Zhejiang | Ningbo, Zhejiang | Finance | 19.00 | Equity method | |
| Shanghai Reno Opto-electronics Technology Co., Ltd. | Shanghai | Shanghai | Commerce | 26.00 [Note] | Equity method | |
| Changzhou Stabila Laser Instrument Company Limited | Changzhou, Jiangsu | Changzhou, Jiangsu | Manufacturing | 31.85 [Note] | Equity method | |
| Hangzhou Weina Technologies Co., Ltd. | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Manufacturing | 32.53 | Equity method | |
The Company holds 19.00% equity of Ningbo Donghai Bank Co., Ltd., making it its second largest shareholder. The Companyhas representatives in its Board of Directors who have the power to participate in decision-making on its financial and operating policies。
（2）Main financial information of significant joint ventures
Currency: RMB
| Closing balance/Current period cumulative | Opening balance/Preceding period comparative | |
| Items | Closing balance/Current period cumulative (in 0,000) | Opening balance/Preceding period comparative (in 0,000) | ||
| Zhejiang Hangcha Holding Co., Ltd. | Hangzhou Zhongce Haichao Enterprise Management Co., Ltd. | Zhejiang Hangcha Holding Co., Ltd. | Hangzhou Zhongce Haichao Enterprise Management Co., Ltd. | |
| Current assets | 526,660.25 | 1,191,930.39 | 382,172.08 | 1,090,203.16 |
| Non-current assets | 332,008.14 | 1,736,549.59 | 293,272.70 | 1,686,081.04 |
| Total assets | 858,668.39 | 2,928,479.98 | 675,444.78 | 2,776,284.20 |
| Current liabilities | 269,927.08 | 1,115,390.51 | 154,561.90 | 1,237,091.54 |
| Non-current liabilities | 6,631.75 | 665,678.33 | 6,544.74 | 493,528.97 |
| Total liabilities | 276,558.83 | 1,781,068.84 | 161,106.64 | 1,730,620.51 |
| Non-controlling interest | 321,291.05 | 667,438.88 | 282,720.34 | 636,650.61 |
| Equity attributable to owners of parent company | 260,818.51 | 479,972.26 | 231,617.80 | 409,013.08 |
| Proportionate share in net assets | 52,163.70 | 116,993.24 | 46,323.56 | 99,696.94 |
| Adjustments | ||||
| Difference between fair value and carrying amount | 10,897.97 | 10,897.97 | ||
| Carrying amount of investments in associates | 63,061.67 | 116,993.24 | 57,221.53 | 99,696.94 |
| Operating revenue | 1,145,572.79 | 2,814,832.69 | 886,062.88 | 432,729.13 |
| Net profit attributable to parent company | 39,653.04 | 72,078.86 | 30,112.85 | 10,120.99 |
| Net profit of discontinued operations | ||||
| Other comprehensive income attributable to parent company | -1,064.61 | -9,060.21 | -1,748.24 | -1,107.91 |
| Total comprehensive income | 38,588.43 | 63,018.65 | 28,364.61 | 9,013.08 |
| Dividend from associates received in current period | 2,000.00 | |||
（4）Aggregated financial information of insignificant associates
Currency: RMB
| Closing balance/Current period cumulative | Opening balance/Preceding period comparative | |
| Associates: | -- | -- |
| Proportionate shares in the following items | -- | -- |
| joint ventures: | -- | -- |
| Total carrying amount of investments | 407,329,329.45 | 362,160,305.55 |
| Proportionate shares in the following items | -- | -- |
| --Net profit | 5,531,925.43 | -19,437,200.31 |
| --Other comprehensive income | -393,307.40 | 199,389.23 |
| --Total comprehensive income | 5,138,618.03 | -19,237,811.08 |
| Associates | Accumulated unrecognized prior period losses | Unrecognized current period losses (net profit shared in current period) | Unrecognized losses at the balance sheet date |
| Shanghai Reno Opto-electronics Technology Co., Ltd. | -676,834.98 | -23,408.70 | -700,243.68 |
| Joint operations name | Main locations | Registered address | Business nature | Holding proportion /Share | |
| Directly | Indirectly | ||||
5、The equity of the structured entity not involved in the scope of consolidation.Related instructions for the structured entity not involved in the scope of consolidation.
6、Others
X. Risks related to financial instruments
In risk management, the Company aims to seek the appropriate balance between the risks and benefits from its use of financialinstruments and to mitigate the adverse effects that the risks of financial instruments have on the Company’s financial performance, soas to maximize the profits of shareholders and other equity investors. Based on such risk management objectives, the Company’s riskmanagement policies are established to identify and analyze the risks faced by the Company, to set appropriate risk limits and controls,and to monitor risks and adherence to limits on a timely and reliable basis.The Company has exposure to the following risks from its use of financial instruments, which mainly include: credit risk, liquidityrisk, and market risk. The Management has deliberated and approved policies concerning such risks, and details are。(I) Credit riskCredit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to dischargean obligation。
1. Credit risk management practice
(1) Evaluation method of credit risk
At each balance sheet date, the Company assesses whether the credit risk on a financial instrument has increased significantlysince initial recognition. When assessing whether the credit risk has increased significantly since initial recognition, the Company takesinto account reasonable and supportable information, which is available without undue cost or effort, including qualitative andquantitative analysis based on historical data, external credit risk rating, and forward-looking information. The Company determinesthe changes in default risk of financial instruments during the estimated lifetime through comparison of the default risk at the balancesheet date and the initial recognition date, on an individual basis or a collective basis
The Company considers the credit risk on a financial instrument has increased significantly when one or more of the followingqualitative and quantitative standards are met:
1) Quantitative standard mainly relates to the scenario in which, at the balance sheet date, the probability of default in theremaining lifetime has risen by more than a certain percentage compared with the initial recognition
2) Qualitative standard mainly relates to significant adverse changes in the debtor’s operation or financial position, present orexpected changes in technology, market, economy or legal environment that will have significant adverse impact on the debtor’s
repayment ability
(2) Definition of default and credit-impaired assets
A financial instrument is defined as defaulted when one or more following events have occurred, of which the standard isconsistent with that for credit-impairment:
1) significant financial difficulty of the debtor；
2) a breach of binding clause of contract；
3) it is very likely that the debtor will enter bankruptcy or other financial reorganization；
4) the creditor of the debtor, for economic or contractual reasons relating to the debtor’s financial difficulty, having granted tothe debtor a concession(s) that the creditor would not otherwise consider。
2. Measurement of expected credit losses
The key factors in the measurement of expected credit loss include the probability of default, loss rate of default, and exposureto default risk. The Company develops a model of the probability of default, loss rate of default, and exposure to default risk on thebasis of quantitative analysis of historical data (e.g. counterparty rating, guarantee measures and collateral type, payment method, etc.)and forward-looking information。
3. Please refer to section V (I) 4, 5, and 7 of the notes to the financial statements for details on the reconciliation table of openingbalance and closing balance of provision for losses of financial instrument
4. Exposure to credit risk and concentration of credit risk
The Company’s credit risk is primarily attributable to cash and bank balances and receivables. In order to control such risks, theCompany has taken the following measures
(1) Cash and bank balances
The Company deposits its bank balances and other cash and bank balances in financial institutions with relatively high credit
levels, hence, its credit risk is relatively low.
(2) Receivables
The Company performs credit assessment on customers using credit settlement on a continuous basis. The Company selectscredible and well-reputed customers based on credit assessment result, and conducts ongoing monitoring on balance of receivables, toavoid significant risks in bad debts.
As the Company only conducts business with credible and well-reputed third parties, collateral is not required from customers.The Company manages credit risk aggregated by customers. As of December 31, 2020, the Company has certain concentration of creditrisk, and 36.10% (December 31, 2019: 37.68%) of the total accounts receivable was due from the five largest customers of the Company.The Company held no collateral or other credit enhancement on balance of receivables
The maximum amount of exposure to credit risk of the Company is the carrying amount of each financial asset at the balancesheet(II) Liquidity riskLiquidity risk is the risk that the Company may encounter deficiency of funds in meeting obligations associated with cash or otherfinancial assets settlement, which is possibly attributable to failure in selling financial assets at fair value on a timely basis, or failurein collecting liabilities from counterparties of contracts, or early redemption of debts, or failure in achieving estimated cash flows.
In order to control such risk, the Company comprehensively utilized financing tools such as notes settlement, bank borrowings,etc. and adopts long-term and short-term financing methods to optimize financing structures, and finally maintains a balance betweenfinancing sustainability and flexibility. The Company has obtained credit limit from several commercial banks to meet working capitalrequirements and expendituresFinancial liabilities classified based on remaining time period till maturity
| Items | Closing balance | ||||
| Carrying amount | Contract amount not yet discounted | Within 1 year | 1-3 years | Over 3 years | |
| Bank borrowings | 1,720,841,106.36 | 1,859,165,409.05 | 1,334,629,400.52 | 441,933,719.49 | 82,602,289.04 |
| Notes payable | 24,913,000.00 | 24,913,000.00 | 24,913,000.00 | ||
| Accounts payable | 1,168,327,985.88 | 1,168,327,985.88 | 1,168,327,985.88 | ||
| Other payables | 26,425,047.57 | 26,425,047.57 | 26,425,047.57 | ||
| Lease liabilities | 271,850,870.28 | 271,850,870.28 | 25,546,871.20 | 48,895,764.20 | 197,408,234.88 |
| Long-term payable | 1,499,174.07 | 1,499,174.07 | 703,214.57 | 795,959.50 | |
| Bonds payable | 799,729,005.89 | 1,121,084,289.21 | 25,116,810.36 | 109,548,195.96 | 986,419,282.89 |
| Subtotal | 4,013,586,190.05 | 4,473,265,776.06 | 2,605,662,330.10 | 601,173,639.15 | 1,266,429,806.81 |
(III) Market riskMarket risk is the risk that the Company may encounter fluctuation in fair value or future cash flows of financial instruments dueto changes in market price. Market risk mainly includes interest risk and foreign currency risk
1. Interest risk
Interest risk is the risk that an enterprise may encounter fluctuation in fair value or future cash flows of financial instruments dueto changes in market interest. The Company’s fair value interest risks arise from fixed-rate financial instruments, while the cash flowinterest risks arise from floating-rate financial instruments. The Company determines the proportion of fixed-rate financial instrumentsand floating-rate financial instruments based on the market environment, and maintains a proper financial instruments portfolio throughregular review and monitoring. The Company’s interest risk in cash flows relates mainly to bank borrowings with floating interest rate
As of December 31, 2020, balance of borrowings with interest accrued at floating interest rate totaled RMB1,009,781,140.56(December 31, 2019: RMB889,351,150.00). If interest rates had been 50 basis points higher/lower and all other variables were heldconstant, the Company’s gross profit and equity will not be significantly affected
2. Foreign currency risk
Foreign currency risk is the risk arising from changes in fair value or future cash flows of financial instrument resulted fromchanges in exchange rate. The Company’s foreign currency risk relates mainly to foreign currency monetary assets and liabilities. Whenshort-term imbalance occurred to foreign currency assets and liabilities, the Company may trade foreign currency at market exchangerate when necessary, in order to maintain the net risk exposure within an acceptable level
Please refer to section 12 (7) 82 of notes to financial statements for details in foreign currency financial assets and liabilities at
| Items | December 31, 2019 | ||||
| Carrying amount | Contract amount not yet discounted | Within 1 year | 1-3 years | Over 3 years | |
| Bank borrowings | 1,664,727,169.67 | 1,702,041,344.24 | 977,580,067.57 | 414,620,900.32 | 309,840,376.35 |
| Held-for-trading financial liabilities | 4,901,459.62 | 4,901,459.62 | 4,901,459.62 | ||
| Notes payable | 309,180,000.00 | 309,180,000.00 | 309,180,000.00 | ||
| Accounts payable | 893,633,852.13 | 893,633,852.13 | 893,633,852.13 | ||
| Other payables | 12,600,147.87 | 12,600,147.87 | 12,600,147.87 | ||
| Lease liabilities | 227,795,752.80 | 227,795,752.80 | 29,661,130.40 | 59,372,680.40 | 138,761,942.00 |
| Long-term payable | 2,475,860.36 | 2,475,860.36 | 891,509.53 | 1,203,194.14 | 381,156.69 |
| Subtotal | 3,115,314,242.45 | 3,152,628,417.02 | 2,228,448,167.12 | 475,196,774.86 | 448,983,475.04 |
the end of the period
XI. Fair value disclosure
1、Details of fair value of assets and liabilities at fair value at the balance sheet date
Currency: RMB
| Items | Fair value as of the balance sheet date | |||
| Level 1 fair value measurement | Level 2 fair value measurement | Level 3 fair value measurement | Total | |
| Recurring fair value measurement | ||||
| 1. Held-for-trading financial assets | 27,191,411.52 | 36,027,480.86 | 532,386.17 | 63,751,278.55 |
| Financial assets classified as at fair value through profit or loss | 27,191,411.52 | 36,027,480.86 | 532,386.17 | 63,751,278.55 |
| Debt instrument investments | 27,191,411.52 | 27,191,411.52 | ||
| Derivative financial assets | 36,027,480.86 | 36,027,480.86 | ||
| Equity instrument investments | 532,386.17 | 532,386.17 | ||
| 2. Receivables financing | 378,066,065.73 | 378,066,065.73 | ||
| 3. Other debt investments | 16,550,000.00 | 16,550,000.00 | ||
| Total assets at recurring fair value measurement | 27,191,411.52 | 36,027,480.86 | 395,148,451.90 | 458,367,344.28 |
5、Continuous third level fair value measurement items, adjustment information between opening balanceand closing balance and sensitivity analysis of the non-observable parameter
6、Continuous fair value measurement items, the reasons for conversion and the policy for conversion timedetermination if it occurs different levels’ conversion during current period
7、Valuation techniques changing and its reason in current period
8、The fair value of financial assets and financial liabilities not measured with fair value.
9、Others
XII. Related party relationships and transactions
1、Related party relationships
| Parent company | Place of registration | Business nature | Registered capital | Holding proportion over the Company (%) | Voting right proportion over the Company (%) |
| GreatStar Greatstar Holding Group. LtdGreatstar Holding Group. Ltd | Hangzhou | Industrial investment | 100 million | 43.13 | 43.13 |
| Associates/ joint ventures names | Relationship with the Company |
| Other related parties | Relationships with the Company |
| Hangzhou Great Star Precision Machinery Co., Ltd. | Under the control of the common actual controller |
| Hangcha Group Co., Ltd.and its affiliated companies | Under the control of the common actual controller |
| Other related parties | Relationships with the Company |
| Zhongce Rubber Group Company Limited | Controlled by the Company’s associate Hangzhou Zhongce Haichao Enterprise Management Co., Ltd., and also under the control of the common actual controller |
| Hangzhou Zhongce Trade Company Limited | Controlled by the Company’s associate Hangzhou Zhongce Haichao Enterprise Management Co., Ltd., and also under the control of the common actual controller |
| Hangzhou Zhongce Auto Space Automobile Service Co., Ltd. | Controlled by the Company’s associate Hangzhou Zhongce Haichao Enterprise Management Co., Ltd., and also under the control of the common actual controller |
| Related parties | Content of transaction | Year 2020 | Approval amount | Exceed the limitation or not | Year 2019 |
| Shanghai Reno Opto-electronics Technology Co., Ltd. | Material | 70,094.25 | 2,000,000.00 | No | 602,347.40 |
| Hangzhou Meiqi Technology Co., Ltd. | Electronic Component | 0.00 | No | 8,745,332.99 | |
| Changzhou Stabila Laser Instrument Company Limited | Material | 129,853.95 | 12,000,000.00 | No | 564,098.86 |
| Changzhou Stabila Laser Instrument Company Limited | Labour service | 23,722.40 | 12,000,000.00 | No | |
| Zhejiang Guozi Robotics Co., Ltd. | Product and service | 1,840,830.51 | 50,000,000.00 | No | 35,245,263.32 |
| Hangcha Group Co., Ltd. and its affiliated companies | Forklift, spare parts and maintenance | 6,054,457.09 | 37,900,000.00 | No | 6,374,677.64 |
| Group Co., Ltd. and its affiliated companies | Automatic storage system | 1,296,460.17 | 37,900,000.00 | No | 12,649,247.81 |
| Hangzhou Zhongce Auto Space | Spare parts and maintenance | 606,294.91 | 100,000,000.00 | No | 68,134.14 |
| Automobile Service Co., Ltd. | |||||
| Hangzhou Zhongce Auto Space Automobile Service Co., Ltd. | Hand tool and spare parts | 6,194.69 | 100,000,000.00 | No |
| Related parties | Content of transaction | Year 2020 | Year 2019 |
| Zhejiang Guozi Robotics Co., Ltd. | Hand tool | 4,387,224.01 | 5,989,753.10 |
| Hangzhou Weina Technologies Co., Ltd. | Technical service | 75,943.40 | 113,584.91 |
| Changzhou Stabila Laser Instrument Company Limited | Laser measurement product | 5,003,092.51 | 5,054,500.99 |
| Water and electricity | 123,594.90 | 120,278.40 | |
| Consulting service | 2,593,278.97 | 1,681,500.22 | |
| Labour service | 29,940.00 | ||
| Hangcha Group Co., Ltd. and its affiliated companies | Hand tool and spare parts | 15,177,595.81 | 11,054,592.93 |
| Operating service | 1,250,867.26 | 754,337.05 | |
| Zhongce Rubber Group Company Limited | Hand tool | 301,911.46 |
| Name of the entrusting party/subcontractor | Name of the entrusted party/contractor | Asset types for entrusted/contracting | The starting date of entrusting/contracting | The expiry date of entrusted/contracting | Pricing basis for entrusting income/contracting income | Entrusting income/contracting income confirmed in current period |
| Name of the entrusting party/subcontractor | Name of the entrusted party/contractor | Asset types for entrusting/subcontracting | The starting date of entrusting/subcontracting | The expiry date of entrusting/subcontracting | Pricing basis for entrusted fee/subcontracting fee | Entrusted fee/subcontracting fee confirmed in current period |
（3）Related party leases
The Company as the lessor
Currency: RMB
| Lessees | Types of asset leased | Lease income for Year 2020 | Lease income for Year 2020 | Lease income for Year 2019 |
| Changzhou Stabila Laser Instrument Company Limited | Changzhou Huada Kejie Opto-electro Instrument Co., Ltd. | Buildings | 185,392.35 | 178,427.70 |
| Lessors | Lessees | Types of asset leased | Lease expenses for Year 2020 | Lease expenses for Year 2019 |
| Hangzhou Great Star Precision Machinery Co., Ltd. | The Company and its subsidiaries | Buildings | 1,296,000.00 | 835,911.23 |
| Hangcha Group Co., Ltd. and its affiliated company 上海杭叉叉车销售有限公司 (Shanghai Hangcha Forklift Sales Co., Ltd.) | The Company | Transport facilities | 241,057.06 | 229,263.13 |
| guaranteed party | amount | Starting date | maturity | Performance completed or not |
| guarantor | amount | Starting date | maturity | Performance completed or not |
| related party | Amount | Starting date | maturity | Notes |
| Borrow |
| Lend |
| related party | Related party transaction items | Current period | Preceding period |
| Items | Year 2020 | Year 2019 |
| Key management’s emoluments | 9,162,360.40 | 8,245,107.51 |
| Items | Related parties | Closing balance | Opening balance | ||
| Book balance | Provision for bad debts | Book balance | Provision for bad debts | ||
| receivable | Zhejiang Guozi Robotics Co., Ltd. | 3,390,261.58 | 169,513.08 | 2,651,956.29 | 132,597.82 |
| receivable | Shanghai Reno Opto-electronics Technology Co., Ltd. | 1,684,295.07 | 84,214.75 | 4,176,445.92 | 1,229,158.98 |
| receivable | Changzhou Stabila Laser Instrument Company Limited | 2,161,820.67 | 108,091.03 | 2,109,688.57 | 105,484.43 |
| receivable | Hangcha Group Co., Ltd. and its affiliated company 杭州杭叉机械加工有限公司 (Hangzhou Hangcha Machinery Processing Co., Ltd. ) | 1,903,592.60 | 95,179.63 | 1,095,162.30 | 54,758.12 |
| Hangcha Group Co., Ltd. | 139,581.30 | 6,979.07 | |||
| Subtotal | 9,139,969.92 | 456,998.49 | 10,172,834.38 | 1,528,978.42 | |
| Receivable financing -- Bank acceptance | Zhejiang Guozi Robotics Co., Ltd. | 2,800,000.00 | 100,000.00 | ||
| Subtotal | 2,800,000.00 | 100,000.00 | |||
| Prepaid expenses | Zhejiang Guozi Robotics Co., Ltd. | 414,974.87 | 20,748.74 | 209,774.63 | 10,488.73 |
| Subtotal | 414,974.87 | 20,748.74 | 209,774.63 | 10,488.73 |
| Items | Related parties | Closing balance | Opening balance |
| Accounts payable | Hangcha Group Co., Ltd. and its affiliated companies | 6,305,294.00 | 10,015,355.00 |
| Accounts payable | Zhejiang Guozi Robotics Co., Ltd. | 3,800,654.70 | 6,053,143.93 |
| Accounts payable | Hangzhou Great Star Precision Machinery Co., Ltd. | 240,500.00 | 257,500.00 |
| Accounts payable | Hangzhou Zhongce Auto Space Automobile Service Co., Ltd. | 156,708.54 | 2,214.00 |
| Subtotal | 10,503,157.24 | 16,328,212.93 | |
| Other payables | Hangzhou Great Star Precision Machinery Co., Ltd. | 12,000.00 | 12,000.00 |
| Subtotal | 12,000.00 | 12,000.00 |
3、Cash-settled share-based payment
□ applicable√ not applicable
4、Amendment and termination of share-based payment
5、Others
XIV. Commitments and contingencies
1、Important commitments
Significant commitments on balance sheet dateAs of the approved issuing date of this report, the Company has no significant commitments to be disclosed
2、Contingencies
（1）Important contingent matters as at the balance sheet date
As of the approved issuing date of this report, the Company has no significant contingencies to be disclosed
（2）The Company has no important contingent matters to disclose, and also should make illustrationThere are no significant contingent matters to be disclosed
3、Others
XV. Events after the balance sheet date
1、Important non-adjustment matters
Currency: RMB
| Items | content | Amount of impacts on financial position and operating results | Reasons for failure to estimate impact |
According to the “Proposal on 2020 Profit Distribution Plan” deliberated and approved by the eighth meeting of the fifth sessionof the Board of Directors of the Company dated April 14, 2021, the Company will not distribute cash dividend or bonus shares, willnot use capital reserve to increase share capital, and the remaining undistributed profits will be carried forward to the next year.
(2) Deliberated and approved by the fifth meeting of the fifth session of the Board of Directors of the Company dated January 22,2021, the Company is approved to exercise the conditional redemption right of “Great Star Convertible Bond” (bond code: 128115),and redeem all non-converted “Great Star Convertible Bond” registered with China Securities Depository and Clearing Co., Ltd.Shenzhen Branch after the market closure on the redemption registration date at the price of the face value of the bond plus the interestaccrued in the current period. As of the market closure on February 23, 2021, there are still 25,732 unconverted “Great Star ConvertibleBond”, and the number of redemption during this time is 25,732. As of February 24, 2021, all the “Great Star Convertible Bond”registered as of the market closure on the redemption registration date (the trading day immediately before the redemption date:
February 23, 2021) have been redeemed. Since March 5, 2021, the “Great Star Convertible Bond” issued by the Company have beendelisted on the Shenzhen Stock Exchange
(3) Deliberated and approved by the fifth meeting of the sixth session of the Board of Directors of the Company dated March 29,2021, the Company is approved to increase capital of EUR 27.90 million or USD equivalent to its wholly-owned subsidiary GreatStarEurope AG, and GreatStar Europe AG will purchase related assets from Joh. Friedrich Behrens AG through cash payment at theconsideration of EUR 27.90 million. The related assets include real estate, machinery, intellectual property rights, inventory, and certainsubsidiary equity related to Joh. Friedrich Behrens AG’s main business.
(4) Deliberated and approved by the seventh meeting of the fifth session of the Board of Directors of the Company dated April 6,2021, the Company is approved to enter into the “Offer to Purchase Geelong Holdings Limited” (the “Offer”) with Orchid AsiaInvestment Management Group Co., Ltd. (Orchid Asia) and Geelong Orchid Holdings Ltd. According to the Offer, the Company willpurchase 100% equity of Geelong Holdings Limited held by Orchid Asia through Geelong Orchid Holdings Ltd. through cash paymentat the consideration of USD 131.40 million. The funds required for the transaction will be raised by the Company itself, partly fromthe change in the use of part of the raised funds, which will be required for deliberation and approval by the Company’s shareholders’general meeting. If the shareholders’ general meeting fails to approve the “Proposal on Changing the Use of Part of the Raised Fundsfor the Acquisition of Equity”, the Company will use all self-raised funds for the acquisition without a separate deliberation andapproval by the Board of Directors, which will not affect the effectiveness and implementation of the acquisition
（5）According to the “Proposal on Absorbing the Wholly-owned Subsidiary Hangzhou Lianhe Machinery Co., Ltd.” deliberatedand approved by the eighth meeting of the fifth session of the Board of Directors of the Company dated April 14, 2021, in order tobetter integrate the Company’s existing innovative R&D resources and better support the Company’s own brand and cross-border e-commerce business development, the Company is approved to absorb its wholly-owned subsidiary, Hangzhou Lianhe Machinery Co.,
Ltd., and incorporate its project “R&D Center Construction Project” into the Company’s R&D system. The financial statements ofHangzhou Lianhe Machinery Co., Ltd. have been consolidated into the Company’s consolidated financial statements. The absorbingmerger will not have a material impact on the Company’s production, operation and financial status.
XVI. Other significant matters
1、Accounting error correction for previous period
（1）The retrospectively adjusted method
Currency: RMB
| Content of accounting error correction | processing procedure | Each effected report items of comparative period | accumulative effected amount |
| Content of accounting error correction | approval procedure | Reason |
| Items | Revenue | Expenses | Profit before tax | Income tax | Net profit | Net discontinued operations profit attributable to owners of the parent company |
6、Segment information
（1）Identification basis for reportable segments
Reportable segments are identified according to the structure of the Company’s internal organization, management requirements
and internal reporting system, and based on product segments. Assets and liabilities shared by different segments are allocated amongsegments proportionate to their respective sizes.
The Company determines the reporting segments on the basis of the regional segments, the main operating revenue and the mainoperating cost shall be divided by the actual sales place, and the assets and liabilities shall be divided by the location of the operatingentity.
（2）Financial information of product segments
Currency: RMB
| Items | Hand tools and power tools | Laser measurement | Storage | PPE | Total |
| Revenue from main operations | 5,907,106,985.40 | 513,234,699.39 | 939,420,434.18 | 1,142,565,010.92 | 8,502,327,129.89 |
| Cost of main operations | 4,134,914,061.55 | 365,707,432.15 | 624,178,422.88 | 782,039,974.71 | 5,906,839,891.29 |
| Total assets | 11,722,084,182.97 | 784,363,793.95 | 1,169,236,759.09 | 2,094,309.67 | 13,677,779,045.68 |
| Total liabilities | 3,591,116,404.48 | 214,417,392.80 | 792,767,083.16 | 42,067,981.94 | 4,640,368,862.38 |
| Items | Year 2020 |
| Expense relating to short-term leases | 582,301.10 |
| Expense relating to leases of low-value assets (excluding short-term leases) | 228,497.90 |
| Total | 810,799.00 |
| Items | Year 2020 |
| Interest expenses on lease liabilities | 1,496,292.70 |
| Income from subleasing right-of-use assets | 7,768,928.60 |
| Total cash outflows related to leases | 29,048,716.90 |
| Items | Year 2020 |
| Lease income | 11,727,101.90 |
| Remaining years | Amount |
| Within 1 year | 515,963.00 |
| Over 1 years | 523,333.90 |
| Total | 1,039,296.90 |
| Items | Year 2020 |
| Finance income on the net investment in the lease | 2,255,495.40 |
| Remaining years | Amount |
| Within 1 year | 95,821.70 |
| 1-2 years | 95,821.70 |
| 2-3 years | 95,821.70 |
| 3-4 years | 95,821.70 |
| 4-5 years | 95,821.70 |
| Over 5 years | 204,701.80 |
| Total | 683,810.30 |
| Items | Closing balance |
| Undiscounted lease payments | 683,810.30 |
| Less: Unrealized finance income relating to lease payments | 17,021.38 |
| Net investment in the lease | 666,788.92 |
XVII. Notes to items of parent company financial statements
1、Accounts receivable
（1）Details on categories
Currency: RMB
| categories | Closing balance | Opening balance | ||||||||
| Book balance | Provision for bad debts | Carrying amount | Book balance | Provision for bad debts | Carrying amount | |||||
| Amount | % to total | Amount | % to total | Amount | % to total | Amount | % to total | |||
| Including: | ||||||||||
| Receivables with provision made on a collective basis | 1,352,861,821.37 | 100.00% | 77,001,556.87 | 5.69% | 1,275,860,264.50 | 1,007,089,253.52 | 100.00% | 58,892,951.55 | 5.85% | 948,196,301.97 |
| Including: | ||||||||||
| Total | 1,352,861,821.37 | 100.00% | 77,001,556.87 | 5.69% | 1,275,860,264.50 | 1,007,089,253.52 | 100.00% | 58,892,951.55 | 5.85% | 948,196,301.97 |
| Items | Closing balance | |||
| Book balance | Provision for bad debts | % to total | Accued reasons | |
| Items | Closing balance | ||
| Book balance | Provision for bad debts | % to total | |
| Portfolio grouped with ages | 1,352,861,821.37 | 77,001,556.87 | 5.69% |
| Subtotal | 1,352,861,821.37 | 77,001,556.87 | -- |
| Items | Closing balance | ||
| Book balance | Provision for bad debts | % to total | |
Currency: RMB
| Ages | Book balance |
| Within 1 year | 1,329,744,869.28 |
| 1-2 years | 8,394,689.06 |
| 2-3 years | 2,359,436.02 |
| Over 3 years | 12,362,827.01 |
| 3-4 years | 3,233,556.42 |
| 4-5 years | 1,792,760.45 |
| Over 5 years | 7,336,510.14 |
| Subtotal | 1,352,861,821.37 |
| categories | Opening balance | Increase/Decrease | Closing balance | |||
| Provision | Reversal | Write-off | Others | |||
| Within 1 year | 49,433,296.09 | 17,053,947.37 | 66,487,243.46 | |||
| 1-2 years | 522,458.59 | 317,010.32 | 839,468.91 | |||
| 2-3 years | 646,711.28 | -174,824.08 | 471,887.20 | |||
| 3-4 years | 537,828.14 | 432,238.79 | 970,066.93 | |||
| 4-5 years | 419,771.44 | 476,608.79 | 896,380.23 | |||
| Over 5 years | 7,332,886.01 | 3,624.13 | 7,336,510.14 | |||
| Subtotal | 58,892,951.55 | 18,108,605.32 | 77,001,556.87 | |||
| Company name | Reversal amount | Reversal Method |
| Items | written off |
| Company name | Account Receivable categorized by nature | Write-off amount | Write-off reason | Write-off procedure | Related party or not |
instructions for Written off the account receivables:
（4）Details of the top 5 debtors with largest balances
Currency: RMB
| Debtors | Closing balance of Account Receivable | %of the total closing balance | Closing balance of provision for bad debts |
| Items | Closing balance | Opening balance |
| Other receivables | 883,363,518.44 | 666,322,858.19 |
| Total | 883,363,518.44 | 666,322,858.19 |
| Items | Closing balance | Opening balance |
| Debtors | Closing balance | Overdue date | Reason for overdue | Impaired or not and its basis |
（2）Dividends receivable
1）Details on categories
Currency: RMB
| Items | Closing balance | Opening balance |
| Items | Closing balance | ages | Unrecovered reason | Impaired or not and its basis |
| Nature of receivables | Closing balance | Opening balance |
| Balance due from related parties within the consolidation scope | 903,148,614.64 | 688,053,701.32 |
| Export tax rebates | 25,792,468.24 | 18,378,855.30 |
| Security deposits | 13,833,823.47 | 7,173,287.63 |
| Temporary advance payment receivable | 966,599.78 | 875,688.97 |
| Employee petty cash | 188,025.00 | 84,312.52 |
| Others | 396,240.11 | 1,550,126.04 |
| Total | 944,325,771.24 | 716,115,971.78 |
| Items | Phase I | Phase II | Phase III | Subtotal |
| 12?month expected credit losses | Lifetime expected credit losses (credit not impaired) | Lifetime expected credit losses (credit impaired) | ||
| Opening balance | 34,431,118.57 | 2,054,431.20 | 13,307,563.82 | 49,793,113.59 |
| Opening balance in the current period | —— | —— | —— | —— |
| Provision made in current period | 11,449,674.74 | 441,080.06 | -577,187.49 | 11,313,567.31 |
| Provision written off in current period | 144,428.10 | 144,428.10 | ||
| Closing balance | 45,880,793.31 | 2,495,511.26 | 12,585,948.23 | 60,962,252.80 |
| Ages | Carrying amount |
| Within 1 year | 943,358,197.91 |
| 1-2 years | 702,025.00 |
| 2-3 years | 105,000.00 |
| Over 3 years | 160,548.33 |
| 3-4 years | 125,000.00 |
| 4-5 years | 21,000.00 |
| Over 5 years | 14,548.33 |
| Subtotal | 944,325,771.24 |
| Categories | Opening balance | Increase/Decrease | Closing balance | |||
| Provision | Reversal | Write-off | Others | |||
| Portfolio grouped with balances due from related parties within the consolidation scope | 47,508,669.89 | 10,842,808.36 | 58,351,478.25 | |||
| Portfolio grouped with ages | ||||||
| Within 1 year | 1,096,239.63 | 914,239.53 | 2,010,479.16 | |||
| 1-2 years | 144,572.64 | -74,370.14 | 70,202.50 | |||
| 2-3 years | 908,355.00 | -887,355.00 | 21,000.00 | |||
| 3-4 years | 6,300.00 | 31,200.00 | 37,500.00 | |||
| 4-5 years | 10,500.00 | 10,500.00 | ||||
| Over 5 years | 128,976.43 | 30,000.00 | 144,428.10 | 14,548.33 | ||
| Subtotal | 49,793,113.59 | 10,867,022.75 | 144,428.10 | 60,515,708.24 |
| Debtors | recovered or reversed amount | Way to recover |
| Items | written off amount |
| Other Accounts receivable | 144,428.10 |
| Debtors | Nature of receivables | written off amount | written off reason | written off procedure | Related party or not |
| Debtors | Nature of receivables | Closing balance | Ages | Proportion to the total balance of other receivables (%) | Provision for bad debts |
| Great Star Tools USA,INC. | Balance due from related parties within the consolidation scope | 283,714,817.59 | Within 1 year | 30.04% | 14,185,740.88 |
| Great Star Tools USA,INC. | Balance due from related parties within the consolidation scope | 8,784,003.67 | 1-2 years | 0.93% | 439,200.18 |
| Great Star Tools USA,INC. | Balance due from related parties within the consolidation scope | 215,726,390.11 | 2-3 years | 22.84% | 10,786,319.51 |
| Hangzhou Lianhe Machinery Co., Ltd. | Balance due from related parties | 30,123,600.00 | Within 1 year | 3.19% | 1,506,180.00 |
| within the consolidation scope | |||||
| Hangzhou Lianhe Machinery Co., Ltd. | Balance due from related parties within the consolidation scope | 58,500,000.00 | 1-2 years | 6.19% | 2,925,000.00 |
| Hangzhou Lianhe Machinery Co., Ltd. | Balance due from related parties within the consolidation scope | 69,007,370.00 | 2-3 years | 7.31% | 3,450,368.50 |
| Haining Great Star Intelligent Equipment Co., Ltd. | Balance due from related parties within the consolidation scope | 120,000,000.00 | Within 1 year | 12.71% | 6,000,000.00 |
| Longyou Hugong Forging Three Tools Co., Ltd. | Balance due from related parties within the consolidation scope | 20,000,000.00 | 1-2 years | 2.12% | 1,000,000.00 |
| Longyou Hugong Forging Three Tools Co., Ltd. | Balance due from related parties within the consolidation scope | 20,000,000.00 | 2-3 years | 2.12% | 1,000,000.00 |
| Hangzhou GreatStar Sheffield Tools Co., Ltd. | Balance due from related parties within the consolidation scope | 906,975.00 | Within 1 year | 0.10% | 45,348.75 |
| Hangzhou GreatStar Sheffield Tools Co., Ltd. | Balance due from related parties within the consolidation scope | 5,886,209.32 | 1-2 years | 0.62% | 588,620.93 |
| Hangzhou GreatStar Sheffield Tools Co., Ltd. | Balance due from related parties within the consolidation scope | 731,707.36 | 2-3 years | 0.08% | 146,341.47 |
| Hangzhou GreatStar Sheffield Tools Co., Ltd. | Balance due from related parties within the consolidation scope | 4,641,664.11 | 3-4 years | 0.49% | 1,392,499.23 |
| Hangzhou GreatStar Sheffield Tools Co., Ltd. | Balance due from related parties within the | 3,365,008.27 | 4-5 years | 0.36% | 1,682,504.14 |
| consolidation scope | |||||
| Hangzhou GreatStar Sheffield Tools Co., Ltd. | Balance due from related parties within the consolidation scope | 11,117,742.90 | Over 5 years | 1.18% | 11,117,742.90 |
| Subtotal | -- | 852,505,488.33 | -- | 90.28% | 56,265,866.49 |
| Debtors | Government subsidy | Closing balance | Ages | Estimated collection date, amount, and basis |
| Items | Closing balance | Opening balance | ||||
| Book balance | Provision for impairment | Carrying amount | Book balance | Provision for impairment | Carrying amount | |
| Investments in subsidiaries | 2,949,758,632.92 | 2,949,758,632.92 | 2,714,659,352.92 | 2,714,659,352.92 | ||
| Investments in associates | 2,205,406,001.38 | 2,205,406,001.38 | 1,931,817,900.53 | 2,977,272.88 | 1,928,840,627.65 | |
| Total | 5,155,164,634.30 | 5,155,164,634.30 | 4,646,477,253.45 | 2,977,272.88 | 4,643,499,980.57 | |
| Investees | Opening balance | Increase/ Decrease | Closing balance | Closing balance of provision for impairment | |||
| Increase | Decrease | provision for impairment | others | ||||
| Longyou Yiyang Forging Co., Ltd. | 48,437,846.12 | 48,437,846.12 | |||||
| Hangzhou GreatStar Sheffield Tools Co., Ltd. | 3,300,000.00 | 3,300,000.00 | |||||
| Hangzhou United Electric Manufacture Co., Ltd. | 21,185,561.86 | 21,185,561.86 | |||||
| Hangzhou United Tools Co., Ltd. | 12,804,728.00 | 12,804,728.00 | |||||
| Hangzhou GreatStar Sheffield Trading Co., Ltd. | 5,000,000.00 | 5,000,000.00 | |||||
| Ningbo Fenghua Great Star Tools Co., Ltd. | 22,558,141.65 | 22,558,141.65 | |||||
| Zhejiang Guoxin Tools Co., Ltd. | 25,750,000.00 | 25,750,000.00 | |||||
| Zhejiang Great Star Tools Co., Ltd. | 464,800,000.00 | 464,800,000.00 | |||||
| Hangzhou Juye Tools Co., Ltd. | 120,000,000.00 | 120,000,000.00 | |||||
| Hangzhou Great Star Tools Co., Ltd. | 63,772,246.86 | 63,772,246.86 | |||||
| Hong Kong Great Star International Co., Ltd. | 227,854,794.66 | 227,854,794.66 | |||||
| Changzhou Huada Kejie Opto-electro Instrument Co., Ltd. | 200,864,082.56 | 200,864,082.56 | |||||
| Hangzhou GreatStar | 22,000,000.00 | 22,000,000.00 |
| Intelligent Technology Co., Ltd. | |||||||
| Hangzhou Ole-Systems Co., Ltd. | 9,600,000.00 | 9,600,000.00 | |||||
| Great Star Tools USA, Inc | 627,095,000.00 | 627,095,000.00 | |||||
| Hangzhou GreatStar Craftsman Tools Co., Ltd. | 2,750,000.00 | 1,500,000.00 | 4,250,000.00 | ||||
| Hangzhou United Precision Tool Company | 10,030,288.26 | 10,030,288.26 | |||||
| GreatStar Europe AG | 732,567,215.00 | 732,567,215.00 | |||||
| Hangzhou Lianhe Machinery Co., Ltd. | 7,677,294.07 | 7,677,294.07 | |||||
| Longyou Hugong Forging Three Tools Co., Ltd. | 84,612,153.88 | 84,612,153.88 | |||||
| Haining Great Star Hardware Tools Co., Ltd. | 2,000,000.00 | 2,000,000.00 | |||||
| Suzhou Xindadi Hardware Product Co., Ltd. | 60,000,000.00 | 60,000,000.00 | |||||
| Newland XDD (Thailand) Co., Ltd. | 123,599,280.00 | 123,599,280.00 | |||||
| Guangdong Shiwanke Electrical Appliance Co., Ltd. | 50,000,000.00 | 50,000,000.00 | |||||
| Total | 2,714,659,352. | 235,099,280.0 | 2,949,758,632. |
| 92 | 0 | 92 |
| Investees | Opening balance | Increase/Decrease | Closing balance | Closing balance of provision for impairment | |||||||
| Increase | Decrease | Investments increased | Investments decreased | Investment income recognized under equity method | Adjustment in other comprehensive income | Changes in other equity | Cash dividend/ Profit declared for distribution | ||||
| I、joint ventures | |||||||||||
| II、Associates | |||||||||||
| Hangzhou Zhongce Haichao Enterprise Management Co., Ltd. | 996,969,390.74 | 175,692,233.49 | -22,084,251.05 | 19,355,033.13 | 1,169,932,406.31 | ||||||
| Zhejiang Hangcha Holdings Co., Ltd. | 572,215,254.96 | 79,306,058.52 | -2,129,229.65 | 1,224,640.08 | 20,000,000.00 | 630,616,723.91 | |||||
| Hangzhou Weiming Investment Management Co., Ltd. | 55,838,362.71 | 2,199,270.14 | 58,037,632.85 | ||||||||
| Zhejiang Guozi Robotics Co., Ltd. | 51,459,603.66 | -1,946,855.30 | 1,369.57 | 40,030,405.87 | 89,544,523.80 | ||||||
| Ningbo Donghai Bank Co., Ltd. | 177,447,885.49 | 3,871,861.00 | 181,319,746.49 | ||||||||
| Hangzhou NanoSic Technology Co., Ltd. | 74,910,130.09 | 1,439,514.90 | -394,676.97 | 75,954,968.02 | |||||||
| Hangzhou Meiqi Technology Co., Ltd. [Note] | |||||||||||
| Subtotal | 1,928,840,627.65 | 260,562,082.75 | -24,606,788.10 | 60,610,079.08 | 20,000,000.00 | 2,205,406,001.38 | |||||
| Total | 1,928,840,627.65 | 260,562,082.75 | -24,606,788.10 | 60,610,079.08 | 20,000,000.00 | 2,205,406,001.38 |
| Items | Year 2020 | Year 2019 | ||
| Revenue | Cost | Revenue | Cost | |
| Main operations | 5,361,055,983.42 | 4,061,291,433.13 | 3,997,597,447.94 | 3,066,120,925.59 |
| Other operations | 4,533,964.30 | 2,889,063.37 | 2,944,176.67 | 1,779,548.55 |
| Total | 5,365,589,947.72 | 4,064,180,496.50 | 4,000,541,624.61 | 3,067,900,474.14 |
| Contract classification | Division 1 | Division 2 | Total | |
| Including: | ||||
| Including: | ||||
| Including: | ||||
| Including: |
| Including: | ||||
| Including: | ||||
| Including: |
| Items | Year 2020 | Year 2019 |
| Investment income from long-term equity investments under equity method | 82,000,000.00 | |
| Investment income from long-term equity investments under cost method | 260,562,082.75 | 65,084,654.93 |
| Gains on disposal of long-term equity investments | 266,783.83 | |
| Investment income from financial instruments | 3,647,177.70 | |
| Including: Other equity instrument investments | 10,007,728.68 | 3,928,865.09 |
| Gains on disposal of financial instruments | 356,483,772.96 | 69,013,520.02 |
| Items | Amount | Notes |
| Gains on disposal of non-current assets, including write-off of provision for impairment | -688,830.06 | |
| Government grants included in profit or loss (excluding those closely related to operating activities of the Company, satisfying government policies and regulations, and continuously enjoyed with certain quantity/quota based on certain standards) | 30,007,164.80 | |
| Gains on acquisition of subsidiaries, joint ventures and associates due to the surplus of acquisition-date fair value of net identifiable assets in acquiree over the acquisition cost | 53,341,459.79 | |
| Gains on assets consigned to the third party for investment or management | 1,792,735.16 | |
| Gains on changes in fair value of financial assets and liabilities at fair value through profit or loss and investment income from disposal of financial assets and liabilities at fair value through profit or loss, and available-for-sale financial assets, excluding those arising from hedging business related to operating activities | 62,235,238.75 | |
| Other non-operating revenue or expenditures | -632,799.21 | |
| Other profit or loss satisfying the definition of non-recurring profit or loss | 267,035.13 | |
| Less: Enterprise income tax affected | 25,137,742.09 | |
| Non-controlling interest affected (after tax) | 4,810,141.32 | |
| Total | 116,374,120.95 | -- |
| Profit of the reporting period | Weighted average RONA (%) | EPS (yuan/share) |
| Basic EPS | Diluted EPS | ||
| Net profit attributable to shareholders of ordinary shares | 16.67% | 1.27 | 1.25 |
| Net profit attributable to shareholders of ordinary shares after deducting non-recurring profit or loss | 15.23% | 1.16 | 1.14 |
| Items | Symbols | Year 2020 |
| Net profit attributable to shareholders of ordinary shares | A | 1,350,132,516.91 |
| Non-recurring profit or loss | B | 116,374,120.95 |
| Net profit attributable to shareholders of ordinary shares after deducting non-recurring profit or loss | C=A-B | 1,233,758,395.96 |
| Opening balance of net assets attributable to shareholders of ordinary shares | D | 7,430,589,865.25 |
| Net assets attributable to shareholders of ordinary shares increased due to offering of new shares or conversion of debts into shares | E | |
| Number of months counting from the next month when the net assets were increased to the end of the reporting period | F | |
| Net assets attributable to shareholders of ordinary shares decreased due to cash dividends appropriation | G1 |
| Number of months counting from the next month when the net assets were decreased to the end of the reporting period | H1 | ||
| Net assets attributable to shareholders of ordinary shares decreased due to share repurchase | G2 | ||
| Number of months counting from the next month when the net assets were decreased to the end of the reporting period | H2 | ||
| Others | Translation reserves | I1 | -144,634,445.93 |
| Number of months counting from the next month when other net assets were increased or decreased to the end of the reporting period | J1 | 6 | |
| Increase of other equity instruments due to issuance of convertible corporate bonds | I2 | 190,509,257.28 | |
| Number of months counting from the next month when other net assets were increased or decreased to the end of the reporting period | J2 | 5 | |
| Share in other comprehensive income of Hangzhou Zhongce Haichao Enterprise Management Co., Ltd. under equity method | I3 | -22,084,251.05 | |
| Number of months counting from the next month when other net assets were increased or decreased to the end of the reporting period | J3 | 6 | |
| Share in other comprehensive income of Zhejiang Guozi Robotics Co., Ltd. under equity method | I4 | 1,369.57 | |
| Number of months counting from the next month when other net assets were increased or decreased to the end of the reporting period | J4 | 6 | |
| Share in other comprehensive income of Zhejiang Hangcha Holdings Co., Ltd. under equity method | I5 | -2,129,229.65 | |
| Number of months counting from the next month when other net assets were increased or decreased to the end of the reporting period | J5 | 6 | |
| Share in other comprehensive income of Hangzhou NanoSic Technology Co., Ltd. under equity method | I6 | -394,676.97 | |
| Number of months counting from the next month when other net assets were increased or decreased to the end of the reporting period | J6 | 6 | |
| Share in changes in equity of Zhejiang Guozi Robotics Co., Ltd. under equity method other than net profit or loss, other comprehensive income and profit distribution | I7 | 40,030,405.87 | |
| Number of months counting from the next month | J7 | 2、0 | |
| when other net assets were increased or decreased to the end of the reporting period | ||
| Share in changes in equity of Zhejiang Hangcha Holdings Co., Ltd. under equity method other than net profit or loss, other comprehensive income and profit distribution | I8 | 1,224,640.08 |
| Number of months counting from the next month when other net assets were increased or decreased to the end of the reporting period | J8 | 6 |
| Share in changes in equity of Hangzhou Zhongce Haichao Enterprise Management Co., Ltd. under equity method other than net profit or loss, other comprehensive income and profit distribution | I9 | 19,355,033.13 |
| Number of months counting from the next month when other net assets were increased or decreased to the end of the reporting period | J9 | 6 |
| Changes in remeasurement of the defined benefit plan | I10 | -35,338,213.90 |
| Number of months counting from the next month when other net assets were increased or decreased to the end of the reporting period | J10 | 6 |
| Changes in fair value of other equity instrument investments | I11 | 888,118.45 |
| Number of months counting from the next month when other net assets were increased or decreased to the end of the reporting period | J11 | 8 |
| Consideration for acquisition of non-controlling equity of Hangzhou GreatStar Craftsman Tools Co., Ltd. to offset capital reserve | I12 | -1,959,810.76 |
| Number of months counting from the next month when other net assets were increased or decreased to the end of the reporting period | J12 | 4 | |
| Number of months in the reporting period | K | 12 | |
| Weighted average net assets | L= D+A/2+ E×F/K-G×H/K±I×J/K | 8,098,947,025.65 | |
| Weighted average RONA | M=A/L | 16.67% | |
| Weighted average RONA after deducting non-recurring profit or loss | N=C/L | 15.23% | |
| Items | Symbols | Year 2020 |
| Net profit attributable to shareholders of ordinary shares | A | 1,350,132,516.91 |
| Non-recurring profit or loss | B | 116,374,120.95 |
| Net profit attributable to shareholders of ordinary shares after deducting non-recurring profit or loss | C=A-B | 1,233,758,395.96 |
| Opening balance of total shares [Note] | D | 1,064,448,049 |
| Number of shares increased due to conversion of reserve to share capital or share dividend appropriation | E | |
| Number of shares increased due to offering of new shares or conversion of debts into shares | F | |
| Number of months counting from the next month when the share was increased to the end of the reporting period | G |
| Number of shares decreased due to share repurchase | H | |
| Number of months counting from the next month when the share was decreased to the end of the reporting period | I | |
| Number of shares decreased in the reporting period | J | |
| Number of months in the reporting period | K | 12 |
| Weighted average of outstanding ordinary shares | L=D+E+F×G/K- H×I/K-J | 1,064,448,049 |
| Basic EPS | M=A/L | 1.27 |
| Basic EPS after deducting non-recurring profit or loss | N=C/L | 1.16 |
| Items | Symbols | Year 2020 |
| Net profit attributable to shareholders of ordinary shares | A | 1,350,132,516.91 |
| Net profit affected by dilutive potential ordinary shares | B | 16,733,947.91 |
| Diluted net profit attributable to shareholders of ordinary shares | C=A+B | 1,366,866,464.82 |
| Non-recurring profit or loss | D | 116,374,120.95 |
| Diluted net profit attributable to shareholders of ordinary shares after deducting non-recurring profit or loss | E=C-D | 1,250,492,343.87 |
| Weighted average of outstanding ordinary shares | F | 1,064,448,049 |
| Weighted average of ordinary shares increased due to warrant, share options, convertible bonds, etc. | G | 33,000,814.33 |
| Weighted average of diluted outstanding ordinary shares | H=F+G | 1,097,448,863.33 |
| Diluted EPS | M=C/H | 1.25 |
| Diluted EPS after deducting non-recurring profit or loss | N=E/H | 1.14 |
Section 13 Reference file directoryI. Financial statements containing signatures of the legal representative, the head of accounting work, and the head of accountingbody with seals.II. Original audit report stamped by Pan-China Certified Public Accountants LLP (special general partnership)and signed andstamped with the certified public accountants.III. Original copies of the documents and announcement of the Company published on the newspaper designatedby the CSRC in the reporting period.Reference files above are all kept at board office.
HANGZHOU GREATSTAR INDUSTRIAL CO., LTD.
Chairman: Qiu JianpingApril 14,2021