Shenzhen China Bicycle Company (Holdings) Co., Ltd.
Annual Report 2023
April 2024
Annual Report 2023Section I. Important Notice, Contents and InterpretationBoard of Directors, Supervisory Committee, all directors, supervisors and senior executives of Shenzhen ChinaBicycle Company (Holdings) Co., Ltd. (hereinafter referred to as the Company) hereby confirm that there are noany fictitious statements, misleading statements, or important omissions carried in this report, and shall take allresponsibilities, individual and/or joint, for the reality, accuracy and completion of the whole contents.
Wang Shenghong, Principal of the Company, Sun Longlong, person in charge of accounting works and SheHanxing, person in charge of accounting organ (accounting principal) hereby confirm that the Financial Report of2023 Annual Report is authentic, accurate and complete.All directors are attended the Board Meeting for report deliberation.The Company plans not to distribute cash dividends, not to send bonus shares, and no reserve capitalizing.
Contents
Section I Important Notice, Contents and InterpretationSection II Company Profile and Main Financial IndexesSection III Management Discussion and AnalysisSection IV Corporate GovernanceSection V Enviornmental and Social ResponsibilitySection VI Importan EventsSection VII Changes in Shares and Particular About ShareholdersSection VIII Preferred StockSection IX Corporate BondsSection X Financial Report
Documents Available for Reference
1. Accounting statement carrying the signatures and seals of the legal representative, person in charge ofaccounting and person in charge of accounting organ.
2. Originals auditing report carried with the seal of accounting firm and signature & seal of the CPA.
3. Originals documents of the Company and manuscripts of public notices that disclosed in the newspaperdesignated by CSRC during the reporting period.
4. English version of the Annual Report 2023
Interpretation
| Items | Refers to | Contents |
| Company, the Company, the listed company, CBC Group | Refers to | Shenzhen China Bicycle Company (Holdings)Co., Ltd. |
| Wansheng Industrial | Refers to | Wansheng Industrial Holdings (Shenzhen) Co., Ltd. |
| Guosheng Energy | Refers to | Shenzhen Guosheng Energy Investment Development Co., Ltd. |
| CSRC | Refers to | China Securities Regulatory Commission |
| SSE | Refers to | Shenzhen Stock Exchange |
| SGE | Refers to | Shanghai Gold Exchange |
| SDE | Refers to | Shanghai Diamond Exchange |
| CNY | Refers to | RMB/CNY |
Section II. Company Profile and Main Financial Indexes
I. Company information
| Short form of the stock | Zhonghua A, Zhonghua B | Stock Code | 000017,200017 |
| Short form of the Stock before changed (if applicable) | N/A | ||
| Stock Exchange for listing | Shenzhen Stock Exchange | ||
| Name of the Company (in Chinese) | 深圳中华自行车（集团）股份有限公司 | ||
| Short form of the Company (in Chinese) | 深中华 | ||
| Foreign name of the Company (if applicable) | Shenzhen China Bicycle Company (Holdings)Co., Ltd. | ||
| Short form of foreign name of the Company (if applicable) | CBC | ||
| Legal representative | Wang Shenghong | ||
| Registrations add. | No. 3008, Buxin Rd., Luohu District, Shenzhen | ||
| Code for registrations add | 518019 | ||
| Historical changes of registered address | N/A | ||
| Offices add. | 8/F Shuibei Jinzuo Building, No.89 Beili North Road, Cuizhu Street, Luohu District, Shenzhen | ||
| Codes for office add. | 518029 | ||
| Internet Web Site | www.szcbc.com | ||
| dmc@szcbc.com | |||
II. Person/Way to contact
| Secretary of the Board | Rep. of security affairs | |
| Name | Sun Longlong | Yu Xiaomin, Zhong Xiaojin |
| Contact Address | 8/F Shuibei Jinzuo Building, No.89 Beili North Road, Cuizhu Street, Luohu District, Shenzhen | 8/F Shuibei Jinzuo Building, No.89 Beili North Road, Cuizhu Street, Luohu District, Shenzhen |
| Tel. | 0755-28181688 | 0755-28181688 |
| Fax | 0755-28181009 | 0755-28181009 |
| dmc@szcbc.com | dmc@szcbc.com |
III. Information disclosure and preparation place
| Website of the Stock Exchange where the annual report disclosed | Shenzhen Stock Exchange(http://www.szse.cn) |
| Media and Website where the annual report disclosed | Securities Times, Juchao Website (http://www.cninfo.com.cn) |
| Preparation place for annual report | 8/F Shuibei Jinzuo Building, No.89 Beili North Road, Cuizhu Street, Luohu District, Shenzhen |
IV. Registration changes of the Company
| Uniform Social Credit Code | 914403006188304524 |
| Changes of main business since listing (if applicable) | Main products or services provided at present: Emmelle bicycle, electric bicycle, and gold jewelry. |
| Previous changes for controlling shareholders (if applicable) | 1. In March 1992, the Stock of the Company was listed in Shenzhen Stock Exchange, and 23.28% equity of the Company was held by Shenzhen Lionda Holding Co., Ltd. and Hong Kong Dahuan Bicycle Co., Ltd respectively. 2. In March 2002, legal shares 13.58% A-stock of the Company was obtained by China Huarong Asset Management Co., Ltd. through court auction, and became the first majority shareholder of the Company. 3. On 13 November 2006, the 65,098,412 legal shears of CBC held by Huarong Company was acquired by Shenzhen Guosheng Energy Investment Development Co., Ltd. via the “Equity Transfer Agreement” signed, and first majority of the Company comes to Guosheng Energy. Guosheng Energy is the wholly-owned subsidiary of National Investment, actual controller was Zhang Yanfeng. 4. In January 2011, controlling shareholder of Shenzhen Guosheng Energy Investment Development Co., Ltd.—Shenzhen National Investment Development Co., Ltd. entered into equity transfer agreement with Mr. Ji Hanfei, 100% equity of Guosheng Energy was transfer to Mr. Ji Hanfei with price of 70 million. Shenzhen Guosheng Energy Investment Development Co., Ltd. Shenzhen Guosheng Energy Investment Development Co., Ltd. holds 63,508,747 A-stock of the Company with 11.52% in total share capital of the Company. 5. On February 20, 2017, Ji Hanfei and Guosheng Energy made an “Explanation” to abandon the actual control of the Company, after Ji Hanfei made the declaration to abandon the actual control of the Company, the investment from CBC by Mr. Ji changed to general investment instead of actual controlling, and the actual controller of the Company changed from Ji Hanfei to no actual controller. 6. On November 7, 2022, the newly added non-public offering of shares of the company were listed on the Shenzhen Stock Exchange. Wansheng Industrial holds 137,836,986 shares of the company through the subscription of non-public offering of shares, accounting for 20% of the total share capital after the completion of the non-public offering. On November 28, 2022, the company held the second interim general meeting of shareholders in 2022 to review and approve the Proposal on Nominating Candidates for Non-Independent Director and the Proposal on Nominating Candidates for Independent Director, and the board of directors of the company completed the change of the term of office. Given that Wansheng Industrial holds 20% of the stock equity of the company and determines more than half of the seats on the board of directors of the company, Wansheng Industrial can therefore have a significant influence on the resolutions of the company's general meeting of shareholders and the board of directors. Therefore, the company was changed from a company without controlling shareholder and actual controller to a company with controlling |
shareholder and actual controller, the controlling shareholder ofthe company was changed to Wansheng Industrial, and theactual controller of the company was changed to Mr. WangShenghong.
V. Other relevant informationAccounting firm engaged by the Company
| Name of the accounting firm | Huaxing Certified Public Accountants（LLP） |
| Offices add. for CPA | 7-9 /F, Block B, Zhongshan Bulding, No.152, Hudong Road, Gulou District , Fuzhou ,Fujian |
| Signatory accountant | Huang Guoxiang, Fu Zhitao |
Sponsor engaged by the Company for performing continuous supervision duties in reporting period?Applicable □Not applicable
| Sponsor | Office address of the sponsor | Sponsor representatives | Continuing supervision period |
| Sinolink Securities Co., Ltd. | 23/F Zizhu International Building, No. 1088, Fangdian Rd., Pudong New Area, Shanghai | Li Hong, Xu Juan | 7 November 2022-31 December 2023 |
Financial consultant engaged by the Company for performing continuous supervision duties in reporting period
□Applicable ?Not applicable
VI. Main accounting data and financial indexesWhether it has retroactive adjustment or re-statement on previous accounting data or not
□Yes ?No
| 2023 | 2022 | Changes in the current year over the previous year (+,-) | 2021 | |
| Operation revenue(RMB) | 568,481,907.92 | 444,762,238.25 | 27.82% | 165,246,577.95 |
| Net profit attributable to shareholders of the listed company (RMB) | 17,901,948.24 | -7,616,378.75 | 335.05% | -1,986,692.82 |
| Net profit attributable to shareholders of the listed company after deducting non-recurring gains and losses(RMB) | 18,493,684.11 | -7,644,167.31 | 341.93% | -4,548,872.83 |
| Net cash flow arising from operating activities(RMB) | 29,972,830.62 | -261,419,066.03 | 111.47% | 15,673,932.87 |
| Basic EPS(RMB/Share) | 0.03 | -0.01 | 400.00% | -0.004 |
| Diluted EPS(RMB/Share) | 0.03 | -0.01 | 400.00% | -0.004 |
| Weighted average ROE | 6.22% | -14.30% | 20.52% | -20.04% |
| Year-end of 2023 | Year-end of 2022 | Changes at end of the current year compared with the end of previous year (+,-) | Year-end of 2021 | |
| Total assets(RMB) | 369,677,494.32 | 397,253,487.93 | -6.94% | 97,363,437.22 |
| Net assets attributable to shareholder of listed company (RMB) | 308,761,246.16 | 290,129,318.51 | 6.42% | 8,918,538.16 |
The lower of the company’s net profit before or after deduction of non-recurring profit (gain)/loss for the lastthree financial years is negative, and the audit report for the latest year indicates that there is uncertainty aboutthe company’s ability to continue as a going concern
□Yes ?No
The lower of the net profit before or after deduction of non-recurring profit (gain)/loss is negative
□Yes ?No
VII. Difference of the accounting data under accounting rules in and out of China
1. Difference of the net profit and net assets disclosed in financial report, under both IAS (InternationalAccounting Standards) and Chinese GAAP (Generally Accepted Accounting Principles)
□Applicable ?Not applicable
The Company had no difference of the net profit or net assets disclosed in financial report, under either IAS(International Accounting Standards) or Chinese GAAP (Generally Accepted Accounting Principles) in theperiod.
2. Difference of the net profit and net assets disclosed in financial report, under both foreign accountingrules and Chinese GAAP (Generally Accepted Accounting Principles)
□Applicable ?Not applicable
The Company had no difference of the net profit or net assets disclosed in financial report, under either foreignaccounting rules or Chinese GAAP (Generally Accepted Accounting Principles) in the period.VIII. Quarterly main financial index
In RMB
| Q 1 | Q 2 | Q 3 | Q 4 | |
| Operation revenue | 151,527,917.92 | 141,471,244.58 | 55,503,482.91 | 219,979,262.51 |
| Net profit attributable to shareholders of the listed company | 2,848,657.72 | 2,013,641.18 | 191,639.21 | 12,848,010.13 |
| Net profit attributable to shareholders of the listed company after deducting non-recurring gains and losses | 3,066,157.71 | 1,927,209.63 | 41,781.30 | 13,458,535.47 |
| Net cash flow arising from operating activities | -7,545,878.64 | -27,818,495.02 | -4,622,651.82 | 69,959,856.10 |
Whether there are significant differences between the above-mentioned financial index or its total number andthe relevant financial index disclosed in the company’s quarterly report and semi-annual report
□Yes ?No
IX. Items and amounts of extraordinary profit (gains)/loss?Applicable □Not applicable
In RMB
| Items | 2023 | 2022 | 2021 | Note |
| Non-current asset disposal gain/loss(including the write-off part for which assets impairment provision is made) | -12,298.94 | -16,957.53 | ||
| Government subsidy recognized in current gain and loss(excluding those closely related to the Company’s business and granted under the state’s policies) | 120,500.00 | 142,981.96 | 397,876.20 | |
| Switch-back of provision of impairment of account receivable which are treated with separate depreciation test | 193,430.29 | 763,930.00 | 1,881,334.27 | |
| Net amount of non-operating income and expense except the aforesaid items | -300,037.34 | -662,573.38 | 376,450.05 | |
| Other non-recurring Gains/loss items | 2,092.35 | |||
| Less :Influenced amount of income tax | 210,783.69 | 18,547.21 | 18.42 | |
| Influenced amount of minor shareholders’ equity (after tax) | 384,638.54 | 181,045.28 | 93,462.09 | |
| Total | -591,735.87 | 27,788.56 | 2,562,180.01 | -- |
Details of other gains/losses items that meets the definition of non-recurring gains/losses:
□Applicable?Not applicable
There are no other gains/losses items that meet the definition of non-recurring gains/losses in the Company.Explain the items defined as recurring profit (gain)/loss according to the lists of extraordinary profit (gain)/lossin Q&A Announcement No.1 on Information Disclosure for Companies Offering Their Securities to the Public --- Extraordinary Profit/loss
□Applicable?Not applicable
The Company does not have any non-recurring profit(gain)/loss listed under theQ&A Announcement No.1 onInformation Disclosure for Companies Offering Their Securities to the Public --- Extraordinary (non-recurring)Profit(gain)/lossdefined as recurring profit(gain)/loss
Section III Management Discussion and AnalysisI. Industry of the Company during the reporting periodThe Company shall comply with the disclosure requirement of Jewelry-related industries in the “Shenzhen StockExchange Self-Regulatory Guidelines for Listed Companies No. 3- Industry Disclosure”
(1) Industry development
China is one of the most important jewelry producer and consumer in the world at present. With the growth ofnational economy and the accumulation of residents' wealth, people gradually increase their consumption of high-end consumer goods after meeting the basic living needs. Jewelry with the property of preserving value andshowing personality has become the consumption hotspots of Chinese residents. At the same time, with the rise ofyoung consumers and emerging middle class, the demand for quality personal consumption is gradually upgrading,and the young generation's consumption of jewelry tends to be more routine, which can improve the repurchaserate of jewelry products under various occasions, providing greater development space for the jewelry industry.
Under the background of slowdown in economic growth or increased uncertainty, people tend to spend morerationally and pay more attention to the safety and reliability of family asset allocation. Compared with otherconsumer goods, gold and silver jewelry can not only beautify our life, but also be accepted by more and moreconsumers for its strong functions of preserving wealth, dispersing investment risks and protecting property safety.On the other hand, the jewelry industry has continuously increased its efforts in style design, craft materials,cultural marketing and consumption experience, which has also become an important driving force forconsumption growth.Since 2023, with the full recovery of normal economic and social activities, the policies of expandingdomestic demand and promoting consumption have taken effect, and the consumption potential has beencontinuously released. And the consumption growth rate of gold, silver and jewelry is in a leading position.
(2) Industry development trend analysis
1. The increased industry concentration has become the mainstream trend
For the past few years, consumers’ brand awareness has been increasing. In addition, at the end of 2014, theNational Jewelry Standards Technical Committee revised the mandatory national standard “Regulations on thePurity of Precious Metals in Jewelry and Naming” (GB11887-2012), which deleted the “pure gold” and other titles,guided consumers to pay more attention to jewelry design, craftsmanship, style and brand value, and no longer beattracted by the words “pure gold” in the slogan and pay more attention to product quality, prompting small jewelryenterprises to move closer to large jewelry enterprises. The increasing concentration of the jewelry industry hasbecome the mainstream trend. In contrast, some regional branded or unbranded small jewelry companies are at adisadvantage in terms of scale, capital, cost, etc., coupled with their own lack of ability in brand operationmanagement, product marketing design, and enterprise operation, in the case of consumers paying more and moreattention to brand, they will have to choose to rely on the development of jewelry brands with larger brandawareness, which will further promote the improvement of the industry concentration, and the national jewelrybrands will gain an opportunity for vigorous development.
2. The development trend of industrial clustering is more obvious
The cluster development of the jewelry industry has now become an important direction for China's jewelryindustry to improve its comprehensive competitiveness and promote the extension and upgrade of thecharacteristic industry chain of the regional jewelry. At present, there are more than ten jewelry industry bases inChina, all of which have distinctive characteristics and outstanding advantages. Whether it is pearl cultivation,jade carving or jewelry processing, they all add charm to the city and also bring vitality to the prosperity of thejewelry industry. Special jewelry industry bases such as Shenzhen Luohu, Guangzhou Panyu mainly focus onprecious metal jewelry inlay processing, diamond cutting, and supporting products, forming a series of leadingenterprises and many small and medium-sized enterprises. At the same time, with the strong support of the localgovernment, the supporting system such as logistics services, information services and technical services havebeen continuously improved.
3. The Third- and fourth-tier cities become important consumer markets for the jewelry industryIn recent years, the pace of urbanization in China has gradually accelerated, and the urbanization rate hascontinued to grow. Residents in rural areas are gradually relocating and settling in nearby third- and fourth-tiercities, which steadily deliver new vitality to the third- and fourth-tier cities. In the future, the third- and fourth-tiercities will have broad market space and show huge growth potential. With the sinking trend of the jewelryconsumption market, the third- and fourth-tier cities will become the main markets for the growth of jewelrycompanies in the future.
4. Channel strength will be regarded as the core competitiveness of enterprises for a long timeThe internal competition in the jewelry industry is relatively large, and the fierce market competition makes theconstruction and control of sales channels for jewelry companies crucial. At the same time, due to the high valueof jewelry, consumers are often worried about the quality of the product and the reasonableness of the price whenpurchasing, which often prompts them to purchase through physical channels. There is a certain scarcity of high-quality physical channels, and the number of high-quality shops in a region’s high-quality business districts isscarce. Such high-quality shops can not only provide higher traffic, improve the retail performance of jewelry, butalso have the important value of brand promotion. Therefore, in the fierce market competition, it is very importantfor jewelry enterprises to control high-quality physical channels, which reflects the core competitiveness ofenterprises on the other side.
5. Brand and design capabilities will become a new driving force for the development of the industryWith the change of consumer demographic structure and the increase of per capital income, the middle and uppermiddle class and wealthy people have gradually become the main force of consumption, and the mainstreamconsumption concept has also quietly changed. Compared with traditional consumers, emerging consumer groupspay more attention to the design, craftsmanship, style and brand value of jewelry products, hoping to meet theirneeds to show their taste and personality. In addition, the National Jewelry Standards Technical Committee hasremoved titles such as “pure gold from the national standards, further prompting consumers to pay attention to thedesign, craftsmanship, style and brand value of jewelry, rather than overemphasizing purity.
6. There is large space for improving the penetration rate of diamond jewelry
In China, different Jewellery products have different market maturity levels. Among them, gold jewelry has arelatively deep foundation in Chinese culture, and it is still the main jewelry consumption type so far. Thediamond jewelry is small in volume but is growing rapidly, and has a broad space for industry development in thefuture. With the further reduction of diamond inventory and promotion of the resume dynamic betweeninternational contact and trading cooperation, China’s diamond imports and consumption is expected to recoverrapidly.
7. The rapid development of e-commerce market creates omni-channel marketing modelThe Internet has provided more convenient and more widely spread way of information sharing, guiding theconsumers' demands and choices. In recent years, jewelry retail enterprises have further strengthened onlinelayout, built new media matrix through various social communication platforms, formed multi-channel customersources, realized rapid spread of online brands and drainage and sales of offline stores, and created a new mode ofomni-channel marketing. The development of sharing platforms and e-commerce platforms has changed theconsumption habits of consumers, especially the young generation.Online consumers can more conveniently understand product features and share user experience, which hasbecome an important trend of product promotion and future sales. Especially with the rise of live streamingplatforms of e-commerce and social contact, the market share of live streaming e-commerce is increasing rapidly.
8. Supply chain management has become an important business method for jewelry enterprisesFrom the perspective of supply chain in the jewelry industry, it mainly involves raw material mining, processingand smelting, blank processing, jewelry production, warehousing, distribution and sales. The jewelry enterprisecontinue to optimize their supply chain management in order to shorten the supplying cycle and lower operatingcosts while guarantee the quality. More and more well-known domestic jewelry brands have outsourced part or allof the intermediate processing links with low gross profit and large investment over recent years, focusing onpremium front-end design, brand operation and back-end marketing network construction. Supply chainmanagement has become a major means for Jewelry enterprise to improving their operational efficiency.
(3) Competitive advantages of the company to engage in the jewelry and gold business
1. Superior quality of upstream supplier system
As things are at the moment, the company has established relatively stable cooperative relationships with majordiamond suppliers and processors at home and abroad, and has advantages in raw material procurement cost,order production cycle and product quality control, which can continuously reduce supply cost and improveoperational efficiency.
2. Diversified downstream market channels and customer resources
The company is actively expanding its gold jewelry customers now. In addition to customers with clear orders, itis currently negotiating business cooperation with a number of domestic jewelry brands. The above customersinclude three types of customers, of which Class A customers are national well-known brand customers, withmore than 500 retail stores; Class B customers are small and medium-sized/regional/segmented brands, with 300-
500 retail stores; Class C customers are small and medium-sized brands, with 50-100 retail stores.
3. Improve the industrial chain of production and design
The company has a one-stop industrial chain of design, production, processing, testing, and wholesale. Brandowners can rely on our jewelry processing resources to hand over lower value-added links such as manufacturingand distribution to the company, so as to focus on the higher value-added brand operation and sales links.Outsourcing in the production and design process can improve the homogenization of gold jewelry products.
4. Closed-loop business process and risk control system
The company has formulated strict business internal control processes such as supplier admittance standards,customer evaluation system, full-process order tracking system, and procurement price comparison system, andhas realized the closed-loop control of capital flow, information flow and logistics and the multi-level risk controlthrough the integrated service platform of supply system and the integrated solution of capital management.II. Main businesses of the Company during the reporting periodThe Company shall comply with the disclosure requirement of Jewelry-related industries in the “Shenzhen StockExchange Self-Regulatory Guidelines for Listed Companies No. 3- Industry Disclosure”During the reporting period, the company mainly engaged in jewelry gold business, bicycle and new-energylithium battery material business: (1) Gold jewelry business -The company connected with downstream goldjewelry brands, purchased gold and diamonds according to their product needs, and then entrusted gold jewelryprocessing plants for processing, and delivered the inspected and qualified finished products to downstreamcustomers after making product certificate for them. Through the integration of upstream supplier resources anddownstream customer resources, the turnover speed of gold jewelry products in upstream and downstream hasbeen improved, the cost of circulation has been reduced, and the overall competitive advantage of upstream anddownstream has formed. (2) Bicycle and new-energy lithium battery material business includes production,assembly, procurement, and sales of bicycles and electric bicycles, and procurement, sales, and consignedprocessing of lithium batteries materials, etc.
As the operation revenue from Jewelry-related business for year of 2023 accounts for more than 30% of theCompany’s audited operation revenue for the most recent fiscal year, the Company is required to comply with thedisclosure requirement of Jewelry-related industries in the “Shenzhen Stock Exchange Self-Regulatory Guidelinesfor Listed Companies No. 3- Industry Disclosure”, specific disclosures are as follow:
(1) Main business models during the reporting period
1. Sales model
According to the market demand and customer demand, the Company carries out raw materialprocurement, product development design and processing/outsourcing processing, and then forms finishedproducts to sell to customers.
2.Procurement model
The upstream raw material suppliers of the company’s gold jewelry supply chain business were mainly diamondsand gold, of which the diamond suppliers were mainly source producers or wholesalers from India or Hong Kong,and domestic mature diamond wholesalers (generally members of the Shanghai Diamond Exchange) ), gold wasmainly purchased from the Shanghai Gold Exchange through the company's membership qualifications atShanghai Gold Exchange. The company has established professional procurement department and team to beresponsible for the procurement of diamond products and jewellery. The specific procurement models variedaccording to customer needs.
3. Production model
By integrating upstream commissioned processing plants, the company outsourced the production of productsordered by customers to professional jewelry manufacturers to give full play to their professional and scale effect.In view of the current situation and characteristics of domestic jewelry processing enterprises, the companyestablished a set of effective supplier management mechanisms and evaluation standards to achieve a benigninteraction between the production system of outsourced manufacturers and the company's business development.
(2) Operation of the physical store during the reporting period
During the reporting period, gold and jewelry business of the Company mainly provides supply chainmanagement and services in the vertical field of gold and jewelry, it connects with the downstream gold jewelrybrand and does not have the physical stores.
(3) Operation of the on-line sales in reporting period
The Company does not have on-line sales in the Period
(4) Inventory in the reporting period
As of the end of the report, inventory of the Jewelry business was 82,088,217.67 yuan, an increase of 74.39 %from the beginning of the period. Type of the inventories including:
In RMB
| Item | Types | Amount | Proportion |
| Finished goods | Jewelry | 6,907,433.01 | 8.41% |
| Gold jewelry | 26,734,491.87 | 32.57% | |
| Other | 2,129,894.63 | 2.59% | |
| Total | 35,771,819.51 | 43.58% | |
| Raw materials | Gold | 38,514,722.50 | 46.92% |
| Platinum | 0.00 | - | |
| Diamond | 4,390,249.94 | 5.35% | |
| Total | 42,904,972.44 | 52.27% | |
| Goods in process | 3,411,425.72 | 4.16% | |
| Total | 82,088,217.67 | 100.00% |
III. Core Competitiveness Analysis
Jewelry and gold business is the core business of the Company. The Company pays attention to both theeconomic situation and the fluctuation of raw material prices at home and abroad. During the reporting period, theCompany strove to develop new customers, maintain old customers, select the superior and eliminate the inferior,and further enrich and expand the customer base; It strengthened product development and quality management; Itsupplied raw materials such as gold purchased from Shanghai Gold Exchange and diamonds purchased fromqualified suppliers to brands, wholesalers and distributors in batches through product design,processing/commissioned processing and quality inspection and acceptance. During the reporting period, in orderto optimize the allocation of resources and enhance the competitiveness and comprehensive strength of theCompany in the jewelry and gold field, on the basis of reference on evaluation value, upon the deliberation andapproval by the Company's General Meeting of Shareholders, the Company purchased 35% equity of the holdingsubsidiary Xinsen Company at a price of RMB 25.55 million, and Xinsen Company became a wholly-ownedsubsidiary of the Company. During the reporting period, the Company continued to operate the bicycle andelectric bicycle business, followed the development of new energy industries, strove to develop new products, andcarried out online and offline sales and brand management. Competitive advantage of the Company in jewelry andgold business;
1. High-quality upstream supplier system
At present, the company has established stable cooperative relations with major diamond suppliers and processorsat home and abroad, and has advantages in raw material purchase cost, order production cycle and product qualitycontrol, which can continuously reduce the supply cost and operation efficiency.
2. Diversified downstream market channels and customer resources
At present, the company is actively developing gold and jewelry customers. In addition to customers placed orders,the company is negotiating business cooperation with many domestic jewelry brands. There are three types ofcustomers, type A customers are national well-known brand customers with more than 500 retail stores; type Bcustomers are small and medium-sized/regional/segmented brands with 300-500 retail stores; type C customersare small and medium-sized brands with 50-100 retail stores.
3. Industrial chain improvement of production and design links
The company has an industrial chain process coordinating design, production, processing, inspection andwholesale. Brand owners can rely on our jewelry processing resource advantages and hand over low value-addedlinks such as manufacturing and distribution to the company, so as to focus on the brand operation and sales linkswith higher added value. Outsourcing of production and design can improve the homogeneity of gold and jewelryproducts.
4. Closed-loop business process and risk control system
The company has developed strict internal business control processes such as supplier admittance criterion,customer evaluation system, whole-process order tracking system and purchase price comparison system.Through integrated service platform of supply system and integrated solution of fund management, the companyhas realized closed-loop control of capital flow, information flow and logistics, and realized multi-level risk
control.IV. Main business analysis
1. Overview
The jewelry and gold business is the Company's core business. The Company pays attention to the economicsituation at home and abroad, and pays attention to the fluctuations in the price of raw materials at home andabroad. During the reporting period, the Company made great efforts to expand new customers, maintain oldcustomers, select the fittest, and further enrich and expand the customer base; it strengthened the productdevelopment and quality management, purchased gold from the Shanghai Gold Exchange and purchaseddiamonds and other raw materials from qualified suppliers, and then supplied products in batches to variousbrands, wholesalers and distributors through product design, processing/commissioned processing, and qualityinspection. During the reporting period, in order to optimize the allocation of resources and enhance theCompany's competitiveness and comprehensive strength in the field of jewelry and gold, on the basis of thereference appraisal value and upon the resolution of the general shareholder’ meeting of the Company, theCompany purchased 35% of the equity of Xinsen Company held by the minority shareholders of Xinsen Company,a holding subsidiary, at a price of RMB 25.55 million, and Xinsen Company became a wholly-owned subsidiaryto the Company. During the reporting period, the Company continued to adhere to the business of bicycles andelectric bicycles, tracked the development of new energy industries, strived to carry out new product research anddevelopment, and carried out online and offline sales and brand management.
Through various efforts, in 2023, the Company achieved an operating income of RMB 568.48 million(including 99% from jewelry and gold business), an operating profit of RMB 18.91 million and a net profit ofRMB 18.01 million, of which the net profit attributable to shareholders of listed companies was RMB 17.9million.
In RMB
| Item | Period-end or current-period | Beginning or previous period | YOY increase or decrease | Reason for change |
Operation revenue
| Operation revenue | 568,481,907.92 | 444,762,238.25 | 28% | The sales growth in the current period |
Operation cost
| Operation cost | 531,606,161.37 | 416,884,753.17 | 28% | The sales increase in the current period led to the costs increased accordingly |
Loss of creditimpairment (Loss islisted with “-”)
| Loss of credit impairment (Loss is listed with “-”) | -2,735,858.31 | -15,516,772.44 | -82% | Mainly due to the provision of large amount of bad debt losses by the Company in the accounts receivable of the customer Guangshui Jiaxu in the previous period |
Operation profit
| Operation profit | 18,905,549.30 | -6,049,884.46 | The sales increased in the current period and the provision of large bad debt losses in the previous period |
.Net profitattributable toshareholders ofparent company
| .Net profit attributable to shareholders of parent company | 17,901,948.24 | -7,616,378.75 | The sales increased in the current period and the provision of large bad debt losses in the previous period |
Account receivable
| Account receivable | 196,293,133.00 | 250,069,301.93 | -22% |
Other accountreceivable
| Other account receivable | 12,868,327.03 | 438,477.82 | The calculated receipt of the 2023-year performance commitment compensation by Wansheng Industrial Holdings (Shenzhen) Co., Ltd. |
| Inventory | 81,916,039.14 | 48,206,866.81 | 70% | The increase in material procurement and stock in the current period |
Other current assets
| Other current assets | 11,216,095.44 | 35,453,106.62 | -68% | The input tax deductible to be detected in the previous period deducted in the current period |
Cash in-flowarising fromoperation activity
| Cash in-flow arising from operation activity | 700,335,292.53 | 290,169,218.36 | 141% | The sales and collection of funds increased in the current period; the private placement funds of 290 million yuan raised in the previous period was invested in operation and procurement activities |
Cash out-flowarising fromoperation activity
| Cash out-flow arising from operation activity | 670,362,461.91 | 551,588,284.29 | 22% | The sales increased in the current period; the private placement funds of 290 million yuan raised in the previous period was invested in operation and procurement activities |
Net cash flowarising fromoperating activities
| Net cash flow arising from operating activities | 29,972,830.62 | -261,419,066.03 | The sales increased in the current period; the private placement funds of 290 million yuan raised in the previous period was invested in operation and procurement activities |
Net cash flowarising fromfinancing activities
| Net cash flow arising from financing activities | -26,555,205.60 | 279,085,141.56 | The minority shareholders’ equity of the subsidiary was purchased in the current period, and the private placement financing of 290 million yuan was completed in the previous period |
2. Revenue(income) and cost
(1) Constitute of operation revenue
In RMB
| 2023 | 2022 | Y-o-y changes (+,-) | |||
| Amount | Ratio in operation revenue | Amount | Ratio in operation revenue | ||
| Total operation revenue | 568,481,907.92 | 100% | 444,762,238.25 | 100% | 27.82% |
| On industries | |||||
| Gold jewelry | 564,839,114.22 | 99.36% | 427,725,123.35 | 96.17% | 32.06% |
| Bicycles, electric bicycles, lithium battery materials and others | 3,642,793.70 | 0.64% | 17,037,114.90 | 3.83% | -78.62% |
| On products | |||||
| Gold jewelry | 564,839,114.22 | 99.36% | 427,725,123.35 | 96.17% | 32.06% |
| Bicycles, electric bicycles, lithium battery materials and others | 3,642,793.70 | 0.64% | 17,037,114.90 | 3.83% | -78.62% |
| According to region | |||||
| Domestic | 568,481,907.92 | 100.00% | 444,762,238.25 | 100.00% | 27.82% |
| According to sale model | |||||
| Wholesale | 568,481,907.92 | 100.00% | 444,762,238.25 | 100.00% | 27.82% |
(2) Industries, products, regions and sales model that account for more than 10% of the operatingrevenue or operating profit of the Company?Applicable □Not applicable
In RMB
| Operation revenue | Operation cost | Gross profit ratio | Change of operation revenue y-o-y(+,-) | Change of operation cost y-o-y(+,-) | Change of gross profit ratio y-o-y(+,-) | |
| On industries | ||||||
| Jewelry and gold | 564,839,114.22 | 530,252,110.65 | 6.12% | 32.06% | 31.48% | 0.41% |
| On products | ||||||
| Jewelry and gold | 564,839,114.22 | 530,252,110.65 | 6.12% | 32.06% | 31.48% | 0.41% |
| According to region | ||||||
| Domestic | 564,839,114.22 | 530,252,110.65 | 6.12% | 32.06% | 31.48% | 0.41% |
| According to sale model | ||||||
| Wholesale | 564,839,114.22 | 530,252,110.65 | 6.12% | 32.06% | 31.48% | 0.41% |
Under circumstances of adjustment in reporting period for statistic scope of main business data, adjusted mainbusiness based on latest one year’s scope of period-end
□Applicable ?Not applicable
(3) Income from physical sales larger than income from labors
?Yes □No
| Industries | Item | Unit | 2023 | 2022 | Y-o-y changes (+,-) |
| Jewelry and gold | Sales volume | Piece | 46,772.00 | 37,174.00 | 25.82% |
| Inventory | Piece | 9400.00 | 891.00 | 954.99% | |
| Purchasing volume | Piece | 55,281.00 | 36,966.00 | 49.55% | |
| Gold and Gold bar | Sales volume | g | 614,972.07 | 677,309.94 | -9.20% |
| Inventory | g | 4,037.00 | 61,200.00 | -93.40% | |
| Purchasing volume | g | 557,809.07 | 738,509.94 | -24.47% |
Reasons for y-o-y relevant data with over 30% changes?Applicable □Not applicable
1. The jewelry and gold business grew, and the number of physical sales increased.
2. The bicycles, electric vehicles and lithium battery materials business declined, and the number of physicalsales declined.
(4) Performance of significant sales contracts, major procurement contract entered into by the companyup to the current reporting period
□Applicable ?Not applicable
(5) Constitute of operation cost
Classification of industries
In RMB
| Industries | Item | 2023 | 2022 | Y-o-y changes (+,-) | ||
| Amount | Ratio in operation cost | Amount | Ratio in operation cost | |||
| Gold jewelry | Gold jewelry | 530,252,110.65 | 99.75% | 403,281,856.05 | 96.74% | 31.48% |
| Bicycles, electric bicycles, lithium battery materials and others | Bicycles, electric bicycles, lithium battery materials and others | 1,354,050.72 | 0.25% | 13,602,897.12 | 3.26% | -90.05% |
NoteNil
(6) Whether the changes in the scope of consolidation in Reporting Period
?Yes □NoDuring this reporting period, Fujian Huaxinbao Jewelry Co., Ltd., Hainan Shenhua Industrial Co., Ltd.,Shenzhen Huabao Zhenxuan Jewelry Co., Ltd. and Shenzhen Xinsen Precision Manufacturing Co., Ltd. wereadded to the consolidated statements.
(7) Major changes or adjustment in business, product or service of the Company in Reporting Period
□Applicable ?Not applicable
(8) Major sales and main suppliers
Major sales client of the Company
| Total top five clients in sales (RMB) | 442,124,220.35 |
| Proportion in total annual sales volume for top five clients | 77.78% |
| Ratio of related parties in annual total sales among the top five clients | 33.36% |
Information of top five clients of the Company
| Serial | Name | Sales (RMB) | Proportion in total annual sales |
| 1 | Client 1 | 123,172,120.57 | 21.67% |
| 2 | Client 2 | 119,775,927.80 | 21.07% |
| 3 | Client 3 | 75,046,686.47 | 13.20% |
| 4 | Client 4 | 69,859,442.52 | 12.29% |
| 5 | Client 5 | 54,270,042.99 | 9.55% |
| Total | -- | 442,124,220.35 | 77.78% |
Other notes of main clients
□Applicable ?Not applicable
Main suppliers of the Company
| Total purchase amount from top five suppliers (RMB) | 551,476,948.40 |
| Proportion in total annual purchase amount for top five suppliers | 97.62% |
| Ratio of related parties in annual total sales among the top five suppliers | 0.00% |
Information of top five suppliers of the Company
| Serial | Name | Purchase (RMB) | Proportion in total annual purchase |
| 1 | Shanghai Gold Exchange | 475,898,463.70 | 84.24% |
| 2 | Supplier 2 | 45,848,932.12 | 8.12% |
| 3 | Supplier 3 | 20,640,336.87 | 3.65% |
| 4 | Supplier 4 | 5,546,941.11 | 0.98% |
| 5 | Supplier 5 | 3,542,274.60 | 0.63% |
| Total | -- | 551,476,948.40 | 97.62% |
Other notes of main suppliers?Applicable □Not applicableShanghai Gold Exchange is the only legal trading market of precious metals in China. The gold materialsrequired during the reporting period were mainly purchased through Shanghai Gold Exchange, and there is noaffiliation between the Company and top five suppliers.
3. Expenses
In RMB
| 2023 | 2022 | Y-o-y changes (+,-) | Note of major changes | |
| Sales expenses | 5,988,294.90 | 5,688,257.68 | 5.27% | |
| Administrative expenses | 6,762,314.00 | 7,525,176.16 | -10.14% | |
| Financial expenses | -15,192.21 | -196,347.38 | 92.26% | |
| R&D expenses | 1,270,512.42 | 924,567.70 | 37.42% |
4. R&D investment
?Applicable □Not applicable
| Name of Main R&D Projects | Project Purpose | Project Progress | Goal to Achieve | Estimated Impact on the Company's Future Development |
| Research and development of force sharing buffering and shock absorbing technology for mountain bicycles | In response to the existing technological shortcomings, improving the shock absorption performance of mountain bicycles, aiming to further enhance the overall performance of mountain bicycles | The project has been accepted and completed | Further improving the shock absorption performance of mountain bicycles | Improved the shock absorption performance of mountain bikes, enhanced customer experience, and created more revenue for the Company |
| Research and development of new and comfortable bicycle handle grip | Faced with the unique, rugged, and complex environment of mountainous areas, bicycle handle grips are particularly important for cushioning, comfort, and anti- slip during cycling, and the requirements for handle grip are | The project has been accepted and completed | Further improving the shock absorption performance of mountain bicycles | Improved the shock absorption performance of mountain bikes, enhanced customer experience, and created more revenue for the Company |
| particularly high | ||||
| Design of stress bearing structure for positive and negative chainring of bicycle crank set | The positive and negative chainring of bicycle crank set are important components in bicycles, which are relatively vulnerable and consumable. Their performance directly affects the overall quality of bicycles. | The project has been accepted and completed | Improve the quality of positive and negative chainring parts, reduce the loss rate, and ensure the safety of riders | Improved the shock absorption performance of mountain bikes, enhanced customer experience, and created more revenue for the Company |
| R&D of new process design | Based on market demand, with a more precise customer base and product personalization as the target direction, horizontally expand the Company's product width and depth, avoid fierce homogeneous product competition in the market, and initiate project development related product design | The project has been accepted and completed | Further promote the product | Improve the competitiveness of the Company’s products and promote sales |
Personnel of R&D
| 2023 | 2022 | Change ratio(+,-) | |
| Number of R&D (people) | 11 | 14 | -21.43% |
| Ratio of number of R&D | 15.94% | 22.22% | -6.28% |
| Educational background | |||
| Undergraduate | 5 | 7 | -28.57% |
| Master | 0 | 0 | - |
| Below bachelor’s degree | 6 | 7 | -14.29% |
| Age composition | |||
| Under 30 | 3 | 2 | 50.00% |
| 30~40 | 2 | 4 | -50.00% |
| Over 40 | 6 | 8 | -25.00% |
Investment of R&D
| 2023 | 2022 | Change ratio(+,-) | |
| R&D investment (RMB) | 1,270,512.42 | 924,576.70 | 37.42% |
| R&D investment/Operation revenue | 0.22% | 0.21% | 0.01% |
| Capitalization of R&D investment (RMB) | 0.00 | 0.00 | 0.00% |
| Capitalization of R&D investment/R&D investment | 0.00% | 0.00% | 0.00% |
Reasons and effects of significant changes in composition of the R&D personnel
□Applicable ?Not applicable
The reason of great changes in the proportion of total R&D investment accounted for operation revenue thanlast year
□Applicable ?Not applicable
Reason for the great change in R&D investment capitalization rate and rational description
□Applicable ?Not applicable
5. Cash flow
In RMB
| Item | 2023 | 2022 | Y-o-y changes (+,-) |
| Subtotal of cash in-flow arising from operation activity | 700,335,292.53 | 290,169,218.26 | 141.35% |
| Subtotal of cash out-flow arising from operation activity | 670,362,461.91 | 551,588,284.29 | 21.53% |
| Net cash flow arising from operating activities | 29,972,830.62 | -261,419,066.03 | 111.47% |
| Subtotal of cash in-flow arising from investment activity | 50,000.00 | -100.00% | |
| Subtotal of cash out-flow arising from investment activity | 191,819.97 | 40,164.10 | 377.59% |
| Net cash flow arising from investment activities | -191,819.97 | 9,835.90 | -2,050.20% |
| Subtotal of cash in-flow arising from financing activity | 299,292,780.18 | -100.00% | |
| Subtotal of cash out-flow arising from financing activity | 26,555,205.60 | 20,207,638.62 | 31.41% |
| Net cash flow arising from financing activities | -26,555,205.60 | 279,085,141.56 | -109.52% |
| Net increased amount of cash and cash equivalent | 3,225,805.05 | 17,675,911.43 | -81.75% |
Main reasons for y-o-y major changes in aspect of relevant data?Applicable □Not applicableThe previous period's private placement funds of 290 million yuan were in place and invested in operatingactivities, resulting in a net inflow of 280 million yuan from financing activities and a net outflow of 260million yuan from operating activities.The increase in sales revenue and payment collection in the current period resulted in a net cash inflow of RMB30 million from operating activities; In addition, the acquisition of minority shareholders’ equity in thesubsidiary in the current period resulted in a net cash outflow of RMB 26 million from financing activities.
□Applicable ?Not applicable
V. Analysis of the non-main business
□Applicable ?Not applicable
VI. Analysis of assets and liability
1. Major changes of assets composition
In RMB
| Year-end of 2023 | Year-begin of 2023 | Ratio changes(+,-) | Note of major changes | |||
| Amount | Ratio in total assets | Amount | Ratio in total assets | |||
| Monetary fund | 54,148,674.40 | 14.65% | 54,699,491.18 | 13.77% | 0.88% | |
| Account receivable | 196,293,133.00 | 53.10% | 250,069,301.93 | 62.95% | -9.85% | |
| Inventory | 81,916,039.14 | 22.16% | 48,206,866.81 | 12.14% | 10.02% | |
Foreign assets account for a relatively high proportion
□Applicable ?Not applicable
2. Assets and liability measured by fair value
□Applicable ?Not applicable
3. The assets rights restricted till end of the period
1. At the end of the current period, the total fixed output value included six suites of house properties at LianxinJiayuan, Luohu District, Shenzhen purchased in 2016, with original value of 2,959,824.00 Yuan, which wereaffordable housing purchased from the Housing and Construction Bureau of Luohu District to provide toenterprise talents for living. The contract stipulated that the purchasing enterprise is not allowed to conduct anyform of property rights transaction with any units or individual other than the government.VII. Investment analysis
1. Overall situation
?Applicable □Not applicable
| Investment in the Period(RMB) | Investment at same period last year (RMB) | Changes |
| 100,550,000 | 0 | 100% |
2. The major equity investment obtained in the reporting period
?Applicable □Not applicable
In RMB
| Name of investee company | Main business | Investment pattern | Funds | Shareholding | Funding source | Counter-party | Investment term | Type | Progress as at the balance sheet date | Estimated earnings | Gain/loss on investment in the Period | Whether involved in litigation (Y/N) | Disclosure date (if applicable) | Disclosure index(if applicable) |
| Shenzhen Xinsen Jewelry Gold | Jewelry & gold business | Acquisition of minority interests | 25,550,000.00 | 100.00% | Owned funds | N/A | Not applicable | Not applicable | Completed | 0.00 | 0.00 | No | June7,2023 | Found more in the Notice on Purch |
| Supply Chain Co., Ltd | ase of the Minority Interests from Controlling Subsidiary and Related Transactions (Notice No.: 2023-019) released on Juchao Website (www.cninfo.com.cn) | |||||||||||||
| Total | -- | -- | 25,550,000.00 | -- | -- | -- | -- | -- | -- | 0.00 | 0.00 | -- | -- | -- |
3. The major non-equity investment doing in the reporting period
□Applicable ?Not applicable
4. Financial assets investment
(1) Securities investment
□Applicable ?Not applicable
The company had no securities investment in the Period.
(2) Derivative investment
□Applicable ?Not applicable
The Company had no derivatives investment in the Period
5. Application of raised proceeds
?Applicable □Not applicable
(1) General application of raised proceeds
?Applicable □Not applicable
In RMB: 10,000
| Raising year | Way | Total raised capitals | Net raised capitals | Total raised capital used in Period | Total accumulative raised capitals used | Total raised capital has purpose of uses changed in Period | Cumulative raised capitals has purpose of uses changed in total | Ratio of cumulative raised capitals has purpose of uses changed | Total accumulative raised capitals unused | Usage of the retained raised capitals and what is expected to invested with those capitals | Raised capitals idle for more than two years |
| 2022 | Non-public offering of RMB ordinary shares (A stock) | 29,359.28 | 28,882.72 | 464.15 | 28,888.5 | 0 | 0 | 0.00% | 0 | Not applicable | 0 |
| Total | -- | 29,359.28 | 28,882.72 | 464.15 | 28,888.5 | 0 | 0 | 0.00% | 0 | -- | 0 |
| Explanation | |||||||||||
| 1.According to the Official Reply on Approval of Non-Public Offering of Shares of Shenzhen China Bicycle Company(Holdings) Co., Ltd. (ZJXK [2021] No.3552) approved by China Securities Regulatory Commission, agreed that the Company shall issue 137,836,986 RMB ordinary shares (A shares) to a specific object, Wansheng Industrial, through a private offering at 2.13 yuan a share, with total raised funds of 293,592,780.18 yuan. After deducting the expenses of 4,765,621.08 yuan (excluding tax) related to the issuance, the actual net funds raised amounted to 288,827,159.10 yuan. Baker Tilly China Certified Public Accountants (LLP) has conducted an examination on the fund allocation of the company's non-public offering on October 21, 2022, and issued the Capital Verification Report on the Fund Allocation of Non-Public Offering of A Shares of Shenzhen China Bicycle Company (Holdings) Co., Ltd. TZYZ[2022] No.42018.As of December 31, 2023, As of December 31, 2023, the balance of the special accounts for raised funds was RMB 0, and all the special accounts for raised funds had been cancelled. 2. During the reporting period, the company neither changed the fund-raising investment projects, nor changed the location and method of implementing the fund-raising investment projects. 3. During the reporting period, the company deposited, used and managed the raised funds in strict accordance with the Three-party Supervision Agreement on the Deposit of Special Accounts for Raised Funds and performed relevant obligations in accordance with relevant laws and regulations, and timely, truly, accurately and completely disclosed information related to the use of raised funds. There is no violation of the Management System for Raised Funds and relevant laws and regulations. | |||||||||||
(2) Committed projects of the raised proceed
?Applicable □Not applicable
In RMB10,000
| Committ | Change | Total | Investme | Invested | Cumulati | Investme | Date of | Benefit | Achieved | Major |
| ed investment projects and over-raised fund investment | the project (Y/N) (including partially changed) | raised-fund commitment | nt after adjustment (1) | in the period | ve investment amount till end of Period-end (2) | nt progress till end of period-end (3)＝(2)/(1) | reach a predetermined state of use | achieved in the Period | expected benefits (Y/N) | changes of project feasibility (Y/N) |
| Committed investment project | ||||||||||
| Supplemental working capital | No | 28,882.72 | 28,882.72 | 464.15 | 28,888.5 | 100.02% | 0 | Not applicable | No | |
| Subtotal of committed investment project | -- | 28,882.72 | 28,882.72 | 464.15 | 28,888.5 | -- | -- | 0 | -- | -- |
| Investment of the over-raised fund | ||||||||||
| Not applicable | 0 | 0 | 0 | 0 | 0.00% | 0 | Not applicable | No | ||
| Subtotal of over-raised fund investment | -- | 0 | 0 | 0 | 0 | -- | -- | 0 | -- | -- |
| Total | -- | 28,882.72 | 28,882.72 | 464.15 | 28,888.5 | -- | -- | 0 | -- | -- |
| Conditions and reasons of failure to meet schedule or predicted income (by specific projects) (including the reasons for selecting “Not | Not applicable | |||||||||
| applicable ” for “Achieved expected benefits (Y/N)”) | |
| Description of major changes in project feasibility | Not applicable |
| Amount, use of purpose and usage progress of the excessive raised fund | Not applicable |
| Change of the implementation location of project with investment of raised fund | Not applicable |
| Adjustment of the implementation ways of project with investment of raised fund | Not applicable |
| Early investment and replacem | Not applicable |
| ent with the raised fund | |
| Amount and reasons of cash surplus in raised funds during implementing the project | Not applicable |
| Use purpose and destination of the raised funds un-used | Not applicable |
| Problems or other circumstances in the use of raised funds and its disclosure | Not applicable |
（3） Change of fund raised projects
□Applicable ?Not applicable
The Company had no change of fund raised projects in the PeriodVIII. Sales of major assets and equity
1. Sales of major assets
□Applicable ?Not applicable
The Company had no major assets sold in the Period.
2. Sales of major equity
□Applicable ?Not applicable
IX. Analysis of main holding company and stock-jointly companies?Applicable □Not applicableParticular about main subsidiaries and stock-jointly companies net profit over 10%
In RMB
| Company name | Type | Main business | Register capital | Total assets | Net assets | Operation revenue | Operation profit | Net profit |
| Shenzhen Xinsen Jewelry Gold Supply Chain Co., Ltd | Subsidiary | Business of jewelry and gold | 200,000,000 | 128,723,481.42 | 117,910,177.47 | 330,526,627.83 | 4,755,477.69 | 3,500,936.86 |
Particular about subsidiaries obtained or disposed in report period?Applicable □Not applicable
| Company name | Way to obtained or disposed | Impact on overall production and performance |
| Fujian Huaxinbao Jewelry Co., Ltd. | A wholly-owned subsidiary newly established | |
| Shenzhen Xinsen Jewelry Gold Supply Chain Co., Ltd | Purchasing 35% equity from minority interests | |
| Hainan Shenhua Industry Co., Ltd. | A wholly-owned subsidiary newly established | |
| Shenzhen Huabao Zhenxuan JewelryCo., Ltd. | A wholly-owned subsidiary newly established | |
| Shenzhen Xinsen Precision Manufacturing Co., Ltd. | Newly established sub-subsidiary |
Notes of holding and stock-jointly companiesNilX. Structured vehicle controlled by the Company
□Applicable ?Not applicable
XI. Future Development Prospects
Jewelry and gold business is the core business of the Company. The Company pays attention to both theeconomic situation and the fluctuation of raw material prices at home and abroad. During the reporting period, theCompany strove to develop new customers, maintain old customers, select the superior and eliminate the inferior,and further enrich and expand the customer base; It strengthened product development and quality management; Itsupplied raw materials such as gold purchased from Shanghai Gold Exchange and diamonds purchased fromqualified suppliers to brands, wholesalers and distributors in batches through product design,processing/commissioned processing and quality inspection and acceptance. During the reporting period, in orderto optimize the allocation of resources and enhance the competitiveness and comprehensive strength of theCompany in the jewelry and gold field, on the basis of reference on evaluation value, upon the deliberation and
approval by the Company's General Meeting of Shareholders, the Company purchased 35% equity of the holdingsubsidiary Xinsen Company at a price of RMB 25.55 million, and Xinsen Company became a wholly-ownedsubsidiary of the Company. During the reporting period, the Company continued to operate the bicycle andelectric bicycle business, followed the development of new energy industries, strove to develop new products, andcarried out online and offline sales and brand management.ii. Operation plan for the new year:
On the basis of business work over the past few years, the business plan of the Company for 2024 is:
（1）Enhancing corporate governance, standardize operations, further reform and improve the internal operationmanagement system, assessment mechanism, strengthen the construction of management teams, business teamsand technical teams. Perfected the development plan of the Company.
（2）In terms of gold and jewelry business, further establish supplier systems and expand customer resources,the business cooperation between the well-known brands and listed company in particular, expandinginternational business, improve internal business processes and internal control system construction, promote theconstruction of a supply chain system platform to improve operational quality and efficiency, and strive to achievegreater growth in operating income.
（3）In terms of bicycle, electric bicycle and new energy business, with the goal of brand maintenance andnational market expansion, discuss and promote the deepening cooperation between the Company and majordistributors on EMMELLE brand and business. Expand sales network, strengthen quality management, strengthenbrand management, and promote the growth of order business. Continue to follow up the development of newenergy and new material of lithium battery, and explore and seek new breakthroughs.
（4）Continue to cooperate with the manager to carry out asset custody business and relevant litigation response,ensure asset safety and protect the rights and interests of interested parties. Continue to follow up the execution ofGuangshui Jiaxu's lawsuit.
（5）Actively cooperate with shareholders and the Board of Directors to carry out small-sum rapid financing,etc.
（6）Strengthen the background management and office automation, and improve the support of the back officeto the front desk business.iii. Risks for the Company:
(1) Price fluctuation risk of major raw materials
The main raw materials of the company are gold, diamonds, etc. In recent years, affected by changes in theinternational and domestic economic situation, the listed price of gold at the gold exchange fluctuates greatly. Themarket price of platinum is generally positively correlated with the market price of gold. In the long run, themarket price of diamond is in a moderate rising trend. The selling price of the company's gold products calculatedby gram is linked with the listed price of gold and platinum at the gold exchange. If the market prices of gold,platinum, diamonds and other raw materials fall significantly during the inventory turnover period of the company,on the one hand, the company has the risk of gross profit margin decline due to the decline in product selling price;on the other hand, the company will also face the risk of decline in operating performance due to the provision for
inventory write down. At the same time, the rise in selling price caused by the sharp rise in the market price ofraw materials such as gold and diamonds may lead to the decrease of consumers' willingness and the decline ofsales volume, thus adversely affecting the business performance.
(2) The risk of intensifying market competition
In recent years, the jewelry market in China has been developing continuously, and the consumption demand ofjewelry has been developing in the direction of individuation and diversification. At present, China's jewelryindustry has presented diversified competitions. Excellent enterprises in the industry have formed competitiveadvantages in a certain segment by deeply exploring the consumption preferences of specific groups. The marketcompetition has gradually changed from price competition to comprehensive competition among brand, businessmodel, marketing channel, product design and quality, the competition tends to be fierce. In the futuredevelopment, if the company cannot continue to give full play to its advantages, there will be a risk of profitabilitydecline due to intensified competition in the industry.
(3) Risk of market demand decline
As an optional consumption, jewelry is especially sensitive to market demand, economic outlook and consumerpreference. China has become one of the countries with the most obvious growth in the jewelry and jade jewelryindustry in the world. If the economic growth rate declines in the future, the growth of market consumptiondemand may slow down accordingly, which will adversely affect the company's business condition.XII. Reception of research, communication and interview during the reporting period?Applicable □Not applicable
| Time | Reception location | Way | Reception type | Object | Main content and information provided | Basic situation index of investigation |
| May 17,2023 | The on-line platform of “Value On-Line” (www.ir-online.cn) | Other | Other | The investors participated in the online performance briefing for year of 2022 through the internet | The Company's operation, litigation, etc. | Found more in “Investors Relations Activities Sheet”(No.: 2023-001) released on Juchao Website (www.cninfo.com.cn) |
| November 15,2023 | The “Interactive Platform for Investor Relations” on (https://ir.p5w.net) | Other | Other | The investors participated in group reception day for investors of the listed companies in Shenzhen for year of 2023 through (https://ir.p5w.net) | The Company's operation, performance commitment, etc. | Found more in “Investors Relations Activities Sheet”(No.: 2023-002) released on Juchao Website (www.cninfo.com.cn) |
| January- March | The Company | Telephone | Individual | Individual | Consulting | N/A |
| 2023 | communication | investor | company restructuring problem | |||
| April –June 2023 | The Company | Telephone communication | Individual | Individual investor | The consulting company's operation | N/A |
| July –September 2023 | The Company | Telephone communication | Individual | Individual investor | The consulting company's litigation | N/A |
| October –December 2023 | The Company | Telephone communication | Individual | Individual investor | The consulting company's operation | N/A |
XIII. The implementation of the action plan of "Double improvement of quality and return".Whether the Company has disclosed the action plan of "Double improvement of quality and return".
□Yes ?No
Section IV Corporate Governance
I. Corporate governance of the CompanyDuring the reporting period, the company strictly complied with the Company Law, the Securities Law, theGovernance Code for Listed Companies, the Rules for Listing Stocks of Shenzhen Stock Exchange, theGuidelines for the Self-Regulation of Listed Companies of Shenzhen Stock Exchange No. 1 -- StandardizedOperation of Listed Companies on the Main Board, and other relevant laws and regulations, constantly improvedthe corporate governance structure, improved the enterprise management and internal control system, deeply andmeticulously carried out corporate governance activities, and constantly improved the corporate governance level.The general meeting of shareholders, the board meeting and the meeting of supervisors of the company were heldin strict accordance with relevant rules and regulations, and the directors and supervisors can diligently performtheir duties. During the reporting period, the actual situation of corporate governance met the requirements of theregulatory documents on corporate governance issued by China Securities Regulatory Commission and ShenzhenStock Exchange.
1. Shareholders and general meeting of shareholders
The company convened and held the general meeting of shareholders in strict accordance with the Company Law,the Securities Law and other laws and regulations, and the stipulations of the Articles of Association and theRules of Procedure of the General Meeting of shareholders, sent out meeting notice at the prescribed time beforethe general meeting of shareholders, and employed lawyers to witness the meeting and give legal opinions on theconvening and holding of the meeting and the validity of the resolution, ensured that all shareholders, especiallyminority shareholders, enjoy equal status and fully exercise their rights. During the reporting period, the companyheld 4 general meetings of shareholders and considered 16 proposals.
2. Controlling shareholders and the listed company
The company's controlling shareholders exercised their rights and undertook corresponding obligations inaccordance with the law, there was no direct or indirect interference in the company's decision-making andbusiness activities beyond the company's general meeting of shareholders. The company had an independent andcomplete operating system and independent operating ability, and was independent and separated from thecontrolling shareholders, actual controllers and other enterprises controlled by them in terms of business,personnel, assets, institutions and finance. The company's board of directors, board of supervisors and otherinternal organs operated independently, and major decisions were made by the general meeting of shareholdersand the board of directors in accordance with the law.
3. Directors and the board of directors
The board of directors of the company has 9 members, including 3 independent directors. The number andcomposition of the board of directors meet the relevant laws and regulations and the requirements of the Articlesof Association. During the reporting period, all directors of the company performed their duties diligently and
responsibly in strict accordance with relevant laws and regulations, the Articles of Association, Rules ofProcedure of the Board of Directors and other relevant provisions, attended the board meetings and the generalmeeting of shareholders on time, carefully deliberated various proposals, and ensured the standard, efficientoperation and prudent and scientific decision-making of the board of directors. In order to further improve thecorporate governance structure, the board of directors of the company has set up four special committees, namelystrategy, audit, nomination, compensation and assessment, to provide scientific and professional opinions for thedecision-making of the board of directors. During the reporting period, the board of directors held 8 meetings anddeliberated 38 proposals.
4. Supervisors and the board of supervisors
The company's board of supervisors has 3 members, including 1 employee representative supervisor. The numberand composition of the board of supervisors meet the relevant laws and regulations and the requirements of theArticles of Association. During the reporting period, the board of supervisors of the Company convened meetingsin strict accordance with the Articles of Association, the Rules of Procedure of the Board of Supervisors and otherrelevant provisions. All supervisors attended meetings on time, earnestly performed their duties, independentlyand effectively exercised the right to supervise and examine the financial affairs of the company and the legalcompliance of the duties performed by directors and senior managers in a responsible attitude towards allshareholders, supervised and expressed their opinions on major matters, related transactions and financialconditions of the company, and effectively safeguarded the legitimate rights and interests of the company andshareholders. During the reporting period, the board of supervisors held 5 meetings and deliberated 15 proposals.
5. Performance appraisal and incentive and constraint mechanism
The company has gradually established and improved the fair and transparent performance appraisal standardsand incentive and restraint mechanisms for directors, supervisors and senior managers, and the appointment ofsenior managers of the company is open and transparent, and in line with the provisions of laws and regulations.
6. Stakeholders
The company fully respected the legitimate rights and interests of stakeholders, treated suppliers and customers ingood faith, carefully cultivated every employee, strengthened the communication and exchange among all parties,jointly promoted the sustainable and healthy development of the company, and achieved the coordination andbalance of the interests of shareholders, employees and the society while maximizing the profits of the company.
7. Information disclosure and transparency
The company attached great importance to information disclosure and investor relationship management, strictlyimplemented the Information Disclosure Management System, and designated Securities Times andhttp://www.cninfo.com.cn as the company's legal information disclosure media and website, fairly treated allinvestors, and truly, accurately, completely and timely made information disclosure, improved the transparency ofthe company, and protected the legitimate rights and interests of all shareholders.
8. Investor relations
The Company lays great stress on maintaining the good communication with investors. During the reportingperiod, by means of the performance communication meeting and various means such as online group receptiondays for listed companies, the Company introduce the development strategy and business development to theinvestors; the Company actively uses the investor relations interactive platform as an important channel ofcommunication with investors, especially small and medium-sized investors, and answers investor’s questions onthe platform in a timely and serious manner.
Is there any difference between the actual condition of corporate governance and relevant regulations aboutcorporate governance for listed company from CSRC?
□Yes ?No
There are no differences between the actual condition of corporate governance and relevant regulations aboutcorporate governance for listed company from CSRC.II. Independence of the Company relative to controlling shareholder and the actual controller in ensuringthe Company’s assets, personnel, finance, organization and businessesThe company has an independent supply and marketing system, and is independent and separated from thecontrolling shareholders, actual controllers and other enterprises controlled by them in terms of business,personnel, assets, institutions and finance, and has the independent and complete business system and the abilityto operate independently in the market.
1.Independent business
The company has an independent supply and marketing system, and has the ability to operate independently anddirectly to the market. There is no other situation that needs to rely on the controlling shareholders for productionand operation activities. There is no horizontal competition between the company and the controlling shareholders,and the controlling shareholders do not directly or indirectly interfere in the operation of the company.
2. Independent personnel
The company is independent of the controlling shareholders in labor, personnel and salary management. Thegeneral manager, deputy general manager, chief financial officer, secretary of the board and other seniorexecutives of the company neither hold other positions except directors and supervisors in the controllingshareholders, actual controllers and other enterprises controlled by them, nor receive salary from the controllingshareholders, actual controllers and other enterprises controlled by them; The company's directors, supervisors,general manager and other senior executives are selected through legal procedures, and there is no controllingshareholder, any other unit, department or person violating the relevant provisions of the Articles of Associationto interfere in the appointment and removal of the company's personnel.
3. Independent assets
The company has a complete supply, production and marketing system and supporting facilities required forproduction and operation, and legally owns land use rights, housing property rights, ownership of trademark andother assets related to production and operation, and does not rely on the assets of controlling shareholders for
production and operation. The company has registered, established accounts, checked and calculated and managedall assets, and the property rights of all assets are clearly defined and the ownership is clear.
4. Independent institutions
The company has set up necessary functional departments in line with its own characteristics, and eachdepartment operates according to the company's management system and under the leadership of the companymanagement. There is no confusion with the controlling shareholders, the actual controllers and other enterprisescontrolled by them, and there is no subordinate relationship with the controlling shareholders.
5. Independent finance
The company has set up an independent finance department, allocated full-time financial personnel, andestablished a complete accounting system, which enable it to make financial decisions independently, possessnormative financial and accounting system and financial management system for subsidiaries. The company hasindependent bank accounts and pays taxes independently in accordance with the law. There is no situation ofsharing bank accounts or tax payments with the controlling shareholders.III. Horizontal competition
□Applicable ?Not applicable
IV. In the reporting period, the Company held annual shareholders’ general meeting and extraordinaryshareholders’ general meeting
1. Annual Shareholders’ General Meeting in the reporting period
| Session of meeting | Type | Ratio of investor participation | Date | Date of disclosure | Resolutions |
| First Extraordinary shareholders general meeting 2023 | Extraordinary shareholders general meeting | 29.26% | March 6,2023 | March 7,2023 | Refer to the Juchao Website (www.cninfo.com.cn): Resolution of First Extraordinary shareholders general meeting 2023 (No.: 2023-006) |
| Annual General Meeting of 2022 | AGM | 29.34% | June 28,2023 | June 29,2023 | Refer to the Juchao Website (www.cninfo.com.cn): Resolution of Annual General Meeting 2022 (No.: 2023-021) |
| Second Extraordinary shareholders general meeting 2023 | Extraordinary shareholders general meeting | 29.25% | November 16,2023 | November 17,2023 | Refer to the Juchao Website (www.cninfo.com.cn): Resolution of Second Extraordinary shareholders |
| general meeting 2023 (No.: 2023-035) | |||||
| Third Extraordinary shareholders general meeting 2023 | Extraordinary shareholders general meeting | 29.37% | December 20,2023 | December 21,2023 | Refer to the Juchao Website (www.cninfo.com.cn): Resolution of Third Extraordinary shareholders general meeting 2023 (No.: 2023-040) |
2. Request for extraordinary general meeting by preferred stockholders whose voting rights restore
□Applicable ?Not applicable
V. Directors, supervisors and senior executives
1. Basic information
| Name | Sex | Age | Title | Working status | Start dated of office term | End date of office term | Shares held at period-begin (Share) | Amount of shares increased in this period (Share) | Amount of shares decreased in this period (Share) | Other changes (share) | Shares held at period-end (Share) | Reasons for increase or decrease of shares |
| Wang Shenghong | Male | 42 | Chairman | Currently in office | November 28,2022 | November 27,2025 | 0 | 0 | 0 | 0 | 0 | Not applicable |
| Li Hai | Male | 55 | Director | Currently in office | August 26,2010 | November 27, 2025 | 0 | 0 | 0 | 0 | 0 | Not applicable |
| Li Hai | Male | 55 | President | Currently in office | September 26,2013 | November 27,2025 | 0 | 0 | 0 | 0 | 0 | Not applicable |
| Sun Longlong | Male | 51 | Director | Currently in office | June 29,2017 | November 27,2025 | 0 | 0 | 0 | 0 | 0 | Not applicable |
| Sun Longlong | Male | 51 | Secretary of the Board | Currently in office | May 17,2012 | November 27,2025 | 0 | 0 | 0 | 0 | 0 | Not applicable |
| Sun Longlong | Male | 51 | CFO | Currently in office | June 22,2017 | November 27,2025 | 0 | 0 | 0 | 0 | 0 | Not applicable |
| Yao Zhengwang | Male | 49 | Director | Currently in office | August 26,2010 | November 27,2025 | 0 | 0 | 0 | 0 | 0 | Not applicable |
| Yuan | Male | 45 | Direct | Curren | Nove | Nove | 0 | 0 | 0 | 0 | 0 | Not |
| Kang | or | tly in office | mber 28,2022 | mber 27,2025 | applicable | |||||||
| Wang Guoxiang | Male | 70 | Director | Currently in office | November 28,2022 | November 27,2025 | 0 | 0 | 0 | 0 | 0 | Not applicable |
| Guo Qiuquan | Male | 41 | Independent director | Currently in office | November 28,2022 | November 27,2025 | 0 | 0 | 0 | 0 | 0 | Not applicable |
| Zhan Qiyong | Male | 42 | Independent director | Currently in office | November 28,2022 | November 27,2025 | 0 | 0 | 0 | 0 | 0 | Not applicable |
| Yuan Qinghui | Male | 45 | Independent director | Currently in office | November 28,2022 | November 27,2025 | 0 | 0 | 0 | 0 | 0 | Not applicable |
| Guo Yong | Male | 49 | The convener of the board of supervisors | Currently in office | November 28,2022 | November 27,2025 | 0 | 0 | 0 | 0 | 0 | Not applicable |
| Li Niansheng | Male | 40 | Supervisor | Currently in office | November 28,2022 | November 27,2025 | 0 | 0 | 0 | 0 | 0 | Not applicable |
| Yi Wenzhi | Male | 54 | Staff Supervisor | Currently in office | November 28,2022 | November 27,2025 | 0 | 0 | 0 | 0 | 0 | Not applicable |
| Total | -- | -- | -- | -- | -- | -- | 0 | 0 | 0 | 0 | 0 | -- |
During the reporting period, whether there was any departure of directors and supervisors and dismissal ofSenior executives
□Yes ?No
Changes of directors, supervisors and senior executives
□Applicable ?Not applicable
2. Post-holding
Professional background, major working experience and present main responsibilities in Company of directors,supervisors and senior executive
Mr. Wang Shenghong, born in 1982, is a Chinese national without the right of permanent residence abroad. Mr.Wang Shenghong is currently an executive director and general manager of Wansheng Industrial Holdings(Shenzhen) Co., Ltd., an executive director and general manager of Shenzhen Wansheng Kejiao Holding Co., Ltd.,an executive director and general manager of Shenzhen Huaxia Juanyong Cultural Tech. Co., Ltd., and theChairman of the Company.
Mr. Li Hai, born in 1969, graduated from Economic department of Shenzhen University in major of accounting;Mr. Li took the turns of deputy manager of finance department, assistant CFO, secretary of the Board and vicepresident, etc. of the Company, and now he serves as President of the Company.
Mr. Sun Longlong, born in 1973, graduated from Shanghai University of Finance and Economics in 1995 with abachelor degree, a bachelor of Economics. Mr. Sun successively worked as financial affairs in ShenzhenQiongjiao Industry Co., Ltd. and Shenzhen Solar Pipe Co., Ltd.; he worked in the Company since May 1999, andsuccessively served as Deputy Manager of financial department, Manager, manager of comprehensivemanagement department, manager of enterprise management department, now he serves as Director, secretary ofthe Board and CFO of the Company.
Mr. Yao Zhengwang, born in 1975, received a Bachelor of Law degree. Mr. Yao Zhengwang is currently adirector of Shenzhen China Bicycle Company (Holdings) Limited, the general manager of Jilin Fude InvestmentHolding Co., Ltd., a director of Jiaxing Zhishifang Food Technology Co., Ltd., a supervisor of Le Shan CityCommercial Bank Co., Ltd., and a Director of the Company.
Mr. Yuan Kang, born in 1979, graduated from Seneca College in Toronto, Canada, served as a supervisor ofFujian Fenghe Group Co., Ltd., and now serves as a director of the Company.
Mr. Wang Guoxiang, born in 1954, is a Chinese national without the right of permanent residence abroad. He iscurrently a supervisor of Wansheng Industrial Holdings (Shenzhen) Co., Ltd., a supervisor of ShenzhenWansheng Kejiao Holdings Co., Ltd., a supervisor of Shenzhen Huaxia Juanyong Cultural Tech. Co., Ltd., and adirector of the Company.
Mr. Guo Qiuquan, born in 1983, is a member of the Communist Party of China and a Chinese national, a PhD ofBiomedical Engineering, the University of Western Ontario, Canada, a bachelor of Engineering Mechanics and amaster of Physical Electronics from Beijing Institute of Technology, and he belongs to Class-C in the peacockplan of recruiting high-level overseas talents of Shenzhen. In 2016, he was sponsored by the Ministry of HumanResources and Social Security for overseas students. So far, he has published more than 70 papers in internationaladvanced journals, and has 12 authorized invention patents and 12 authorized utility model patents. Some of hispatented technologies won the technology transformation award of WorlDiscovery of the University of WesternOntario. Mr. Guo Qiuquan is currently an associate researcher of the Institute for Advanced Study of Universityof Electronic Science and Technology of China (Shenzhen), general manager of Jiangsu Xinchengrui MaterialTechnology Co., Ltd., the president and general manager of Shenzhen Topmembranes Technology Co., Ltd., andan independent director of the Company.
Mr. Zhan Qiyong, born in 1982, is a member of the Communist Party of China and a Chinese national. He has amaster's degree in accounting from Jiangxi University of Finance and Economics. He is a certified public
accountant and a certified tax agent. Mr. Zhan Qiyong once served successively as an accountant of FinanceDepartment of Shenzhen Wang Xin Linkage Technology Co., Ltd., an accountant and an assistant manager ofFinance Department of Shenzhen Gold Coin Co., Ltd.. Now he is the deputy manager of Finance Department ofShenzhen Gold Coin Co., Ltd., and an independent director of the Company.Mr. Yuan Qinghui, born in 1979, is a Chinese national, has a bachelor 's degree in law, and is a lawyer. He passedthe China Judicial Examination in 2002 and began practicing law in 2003. Now he is the director of FujianLuyuan Laws Firm and an independent director of the Company.
Mr. Guo Yong, born in 1975, graduated as a major in economy and trade from Henan Agricultural University in1995. He is a master of Arts and Crafts in Henan Province and a representative inheritor of national intangiblecultural heritage (jun porcelain firing technique). Mr. Guo Yong successively served as the general manager of theFirst Branch of Henan Provincial Wood Corporation, the general manager of Yuzhou Longyu Tungsten &Molybdenum Material Co., Ltd., and the chairman of Huangshi Wanjun International Art (Shenzhen) Co., Ltd.Currently, he is the chairman and general manager of Henan Wanjuntang Porcelain Culture Development Co.,Ltd., an executive director and general manager of Yuzhou Wanjuntang Culture Development Co., Ltd., anexecutive director and general manager of Zhengzhou Baoshang Jewelry Co., Ltd., director of Intangible CulturalHeritage Committee of Chinese Traditional Culture Promotion Association, and convener of the Board ofSupervisors of the Company.
Mr. Li Niansheng, born in 1984, Chinese nationality, has a bachelor degree in biological engineering from TianjinUniversity of Science and Technology. He successively served as the investment director and general manager ofShenzhen Runjing Asset Management Co., Ltd.. Currently, he is the general manager of Shenzhen Xinsen JewelryGold Supply Chain Co., Ltd., and a supervisor of the Company.
Mr. Yi Wenzhi, born in 1970, has a college degree. He joined the Company in 1992 and successively served as amember of the life management committee of Longhua Plant #2, an equipment manager of painting workshop, aproduction dispatcher of painting workshop, the chairman of the labor union of painting workshop, and a memberof Youth League Committee of Longhua Plant #2. He is currently the deputy director of the company's generalaffairs office, the chairman of the company's labor union, a member of the company's party committee and thesecretary of the second branch, a member of the trade union committee of Shenzhen Yuanling Street, and anemployee representative supervisor of the Company.
Post-holding in shareholder’s unit?Applicable □Not applicable
| Name | Name of shareholder’s unit | Position in shareholder’s unit n | Start dated of office term | End date of office term | Received remuneration from shareholder’s unit (Y/N) |
| Wang Shenghong | Wansheng Industrial Holdings | Executive Director and GM | June 13,2017 | No |
| (Shenzhen) Co., Ltd. | |||||
| Wang Guoxiang | Wansheng Industrial Holdings (Shenzhen) Co., Ltd. | Supervisor | August 13,2018 | No | |
| Explanation | N/A | ||||
Post-holding in other unit?Applicable □Not applicable
| Name | Name of other units | Position in other unit | Start dated of office term | End date of office term | Received remuneration from other unit (Y/N) |
| Wang Shenghong | Shenzhen Huaxia Junyong Cultural Tech. Co., Ltd. | Executive Director and GM | May 9,2020 | No | |
| Wang Shenghong | Shenzhen Chanjuan Holding Development Co., Ltd. | Executive Director and GM | January 7,2020 | No | |
| Wang Shenghong | Shenzhen Chanjuan Industrial Co., Ltd. | Executive Director and GM | December 21,2017 | No | |
| Wang Shenghong | Shenzhen Chanjuan Jewelry Co., Ltd. | Director | August 22,2022 | No | |
| Li Hai | Shenzhen Huhui Alliance E-Commerce Co., Ltd. | Director | April 10,2015 | No | |
| Sun Longlong | Huizhou Daya Bay Longzhen Trading Firm | Merchant in charge | November 10,2021 | No | |
| Yao Zhengwang | Jilin Fude Investment Holding Co., Ltd. | GM | November 21,2014 | No | |
| Yao Zhengwang | Jiaxing Zhishifang Food Tech. Co., Ltd. | Director | December 24,2012 | No | |
| Yao Zhengwang | Lingxiong Technology Group Co., Ltd. | Independent non-executive director | April 11,2023 | Yes | |
| Yao Zhengwang | Le Shan City Commercial Bank | Supervisor | June 21,2019 | Yes | |
| Yao Zhengwang | Zhengda Energy Development (China) Co., Ltd. | Supervisor | February 9,2017 | No | |
| Yao Zhengwang | Shenzhen Guosheng Energy Investment Development Co., Ltd. | Supervisor | October 12,2006 | Yes | |
| Yao Zhengwang | Shenzhen Longpeng Investment Co., Ltd. | Supervisor | July 21,2009 | No |
| Yao Zhengwang | Shenzhen Zhengrui Energy Tech. Co., Ltd. | Supervisor | February 25,2016 | No | |
| Yao Zhengwang | Dalian Qingyi New Energy Co., Ltd. | Supervisor | December 26,2023 | No | |
| Yuan Kang | Fujian Chanjuan Jewelry Co., Ltd. | Executive Director and GM | December 22,2020 | No | |
| Wang Guoxiang | Shenzhen Huaxia Junyong Cultural Tech. Co., Ltd. | Executive Director and GM | May 9,2020 | No | |
| Guo Qiuquan | Shenzhen Topmembranes Tech. Co., Ltd. | Chairman and GM | August 25,2015 | No | |
| Guo Qiuquan | Jiangsu Xinchengrui Material Tech. Co., Ltd. | GM | October 24,2019 | No | |
| Guo Qiuquan | General Artificial Intelligence (Ganzhou) Research Institute | Supervisor | September 7,2023 | No | |
| Guo Qiuquan | Dongguan Ant 3D Printing Co., LTD | Executive Director and GM | December 7,2023 | No | |
| Zhan Qiyong | Shenzhen Gold Coin Co., Ltd. | Deputy financial manager | May 1,2015 | Yes | |
| Yuan Qinghui | Fujian Luyuan Laws Firm | Chief lawyer | September 1,2008 | Yes | |
| Guo Yong | Henan Wanjuntang Porcelain Culture Development Co., Ltd. | Executive Director and GM | January 12,2016 | No | |
| Guo Yong | Yuzhou Wanjuntang Culture Development Co., Ltd. | Executive Director and GM | November 14,2019 | No | |
| Guo Yong | Zhengzhou Baoshang Jewelry Co., Ltd. | Executive Director and GM | July 23,2015 | No | |
| Guo Yong | Henan Jianhe Traditional Chinese Medicine Hospital Co., Ltd. | Supervisor | July 31,2019 | Yes | |
| Guo Yong | Henan Jianhe Pharmacy Co., Ltd. | Supervisor | October 26,2020 | Yes | |
| Guo Yong | Xian Jinyuxin Trade Co., Ltd. | Supervisor | May 6,2023 | No | |
| Guo Yong | Wangsong Guyao（Henan）Cultural Development Co., Ltd | Person in charge of finance | August 1,2023 | Yes | |
| Guo Yong | Zhongrun Cultural Development（Yuzhou）Co., | Person in charge of finance | May 31,2023 | Yes |
| Ltd. | |||||
| Guo Yong | Henan Wangsong Guyao Ceramic Co., Ltd. | Person in charge of finance | August 28,2023 | No | |
| Guo Yong | Zhongrun Porcelain Industry ( Yuzhou) Co., Ltd. | Person in charge of finance | May 39,2023 | No | |
| Li Niansheng | Shenzhen Runjing Assets Management Co., Ltd. | GM | September 19,2016 | No | |
| Yi Wenzhi | Shenzhen Bochuangke Information Consulting Co., Ltd. | Supervisor | May 11,2011 | No | |
| Explanation | Not applicable | ||||
Punishment of securities regulatory authority in recent three years to the company’s current and outgoingdirectors, supervisors and senior management during the reporting period
□Applicable ?Not applicable
3. Remuneration for directors, supervisors and senior executives
Decision-making procedures, recognition basis and payment for directors, supervisors and senior executives
| Decision procedure of remuneration of directors, supervisors, senior management | According to relevant rules of the Article of Association, the general meeting of shareholders decides remuneration of directors and supervisors. The Board of Directors decides senior management’s. |
| Confirmation basis of remuneration of directors, supervisors and senior management | The Company refers to the position rank and comprehensive industry level. And then general meeting of shareholders approves compensation standard and allowance of independent directors. According to the "Interim Measures to Annual Performance Assessment of Executives" and performance evaluation standards the Company issues annual performance salary. |
| Actual payment of remuneration of directors, supervisors and senior management | The Company strictly paid remuneration of directors, supervisors and senior management accordingly with decision procedure and confirmation basis. Total payment for remuneration of directors, supervisors and supervisors amounted to 1.7411 million yuan from January to December in 2023. |
Remuneration for directors, supervisors and senior executives in reporting period
In RMB 10,000
| Name | Sex | Age | Title | Post-holding status | Total remuneration obtained from the Company (before taxes) | Whether remuneration obtained from related party of the Company |
| Wang Shenghong | Male | 42 | Chairman | Currently in office | 10.52 | No |
| Li Hai | Male | 55 | Director, President | Currently in office | 79.44 | No |
| Sun Longlong | Male | 51 | Director, Secretary of the Board, CFO | Currently in office | 30.8 | No |
| Li Niansheng | Male | 40 | Supervisor | Currently in office | 23.85 | No |
| Yi Wenzhi | Male | 54 | Supervisor, employee's representation | Currently in office | 15.22 | No |
| Guo Qiuquan | Male | 41 | Independent director | Currently in office | 4.76 | No |
| Zhan Qiyong | Male | 42 | Independent director | Currently in office | 4.76 | No |
| Yuan Qinghui | Male | 45 | Independent director | Currently in office | 4.76 | No |
| Total | -- | -- | -- | -- | 174.11 | -- |
Other note
□Applicable ?Not applicable
VI. Responsibility performance of directors during the reporting period
1. The board of directors during the reporting period
| Session of meeting | Date of meeting | Disclosure date | Meeting resolutions |
| The 2nd session (interim)of 11th BOD | February 17,2023 | February 18,2023 | Refer to the Juchao Website (www.cninfo.com.cn): (No.: 2023-003) |
| The 3rd session of 11th BOD | April 21,2023 | April 25,2023 | Refer to the Juchao Website (www.cninfo.com.cn): (No.: 2023-008) |
| The 4th session (interim)of 11th BOD | April 27,2023 | April 28,2023 | Deliberated only one proposal as the Q1 Report of 2023, which was disclosed on April 28, 2023 |
| The 5th session (interim)of 11th BOD | June 6,2023 | June 7,2023 | Refer to the Juchao Website (www.cninfo.com.cn): (No.: 2023-018) |
| The 6th session of 11th BOD | August 25,2023 | August 29,2023 | Refer to the Juchao Website (www.cninfo.com.cn): (No.: 2023-024) |
| The 7th session (interim)of 11th BOD | October 27,2023 | October 31,2023 | Deliberated only one proposal as the Q3 Report of 2023, which was disclosed on October 31, 2023 |
| The 8th session (interim)of 11th BO | October 31,2023 | November 1,2023 | Refer to the Juchao Website (www.cninfo.com.cn): (No.: 2023-030) |
| The 9th session (interim)of 11th BOD | December 4,2023 | December 5,2023 | Refer to the Juchao Website (www.cninfo.com.cn): (No.: 2023-036) |
2. The attending of directors to Board meetings and shareholders general meeting
| The attending of directors to Board Meeting and Shareholders General Meeting | |||||||
| Director | Times of Board meeting supposed to attend in the report period | Times of Presence | Times of attending the Board Meeting by communication | Times of entrusted presence | Times of Absence | Absent the Meeting for the second time in a row (Y/N) | Times of attend the general meeting |
| Wang Shenghong | 8 | 7 | 1 | 0 | 0 | N | 4 |
| Li Hai | 8 | 8 | 0 | 0 | 0 | N | 4 |
| Sun | 8 | 8 | 0 | 0 | 0 | N | 4 |
| Longlong | |||||||
| Yao Zhengwang | 8 | 4 | 4 | 0 | 0 | N | 4 |
| Yuan Kang | 8 | 2 | 6 | 0 | 0 | N | 4 |
| Wang Guoxiang | 8 | 0 | 8 | 0 | 0 | N | 2 |
| Guo Qiuquan | 8 | 0 | 8 | 0 | 0 | N | 4 |
| Zhan Qiyong | 8 | 1 | 7 | 0 | 0 | N | 4 |
| Yuan Qinghui | 8 | 0 | 8 | 0 | 0 | N | 4 |
Explanation of absent the Board Meeting for the second time in a rowNot applicable
3. Objection for relevant events from directors
Directors come up with objection about Company’s relevant matters
□Yes ?No
No directors come up with objection about Company’s relevant matters in the Period
4. Other explanation about responsibility performance of directors
The opinions from directors have been adopted?Yes □NoDirector's statement to the Company that a proposal has been or has not been adoptedDuring the reporting period, the directors carefully deliberated all proposals submitted to the BOD and voted infavour of the proposals that required voting, without any opposition or abstention, and raised no objection to theproposals of the Board for the year.VII. Performance of Duties by Specialized Committees under the Board Meeting in the Reporting Period
| Committee name | Members | Number of meetings held | Date of meeting | Meeting content | Important comments and suggestions made | Other performance of duties | Specific circumstances of the objection (if applicable) |
| Audit Committee of the Eleventh Board of Directors | Zhan Qiyong, Guo Qiuquan, Yuan Kang | 4 | January 29,2023 | Annual performance and performance forecast in 2022, hearing about the annual internal audit work in 2022 and annual internal audit work plan in 2023 | Work in strict accordance with the Company Law, Articles of Association, Working Rules of the Audit Committee of the Board of Directors and other relevant laws, regulations and systems, be diligent and dutiful, | Not applicable | N/A |
| April 20,2023 | Report-related matters in 2022 and hearing about the internal | Not applicable | N/A |
| audit work in the first quarter of 2023 | and fully communicate and discuss the related matters |
August22,2023
| August 22,2023 | Matters involved in the 2023 semi-annual report and hearing about the internal audit work in 2023 | Not applicable | N/A | ||||
| December 1,2023 | Deliberating the matters involved in the proposed change of the accounting firm and hearing about the internal audit work in the third quarter of 2023 | Not applicable | N/A | ||||
| Remuneration and Appraisal Committee of the Eleventh Board of Directors | Zhan Qiyong, Yuan Qinghui, Li Hai | 1 | August 22,2023 | Deliberating the proposal on the remuneration of the Company's Chairman | |||
| Special Meeting of Independent Directors of the Eleventh Board of Directors | Guo Qiuquan, Zhan Qiyong, Yuan Qinghui | 1 | October 31,2023 | Deliberating the proposal on increasing the estimated amount of daily related-party transactions in 2023 | Not applicable | N/A |
VIII. Works from Supervisory CommitteeThe Company has risks in reporting period that found in supervisory activity from supervisory committee
□Yes ?No
Supervisory committee has no objection about supervision events in reporting period
IX. Particulars of workforce
1. Number of Employees, Professional composition, Education background
| Employee in-post of the parent Company at period-end (people) | 28 |
| Employee in-post of main Subsidiaries at period-end (people) | 41 |
| The total number of current employees at period-end (people) | 69 |
| The total number of current employees to receive pay (people) | 69 |
| Retired employee’ s expenses borne by the parent Company and main Subsidiaries (people) | 0 |
| Professional composition | |
| Category of professional composition | Numbers of professional composition (people) |
| Production personnel | 6 |
| Salesperson | 25 |
| Technicians | 14 |
| Financial personnel | 9 |
| Administrative personnel | 15 |
| Total | 69 |
| Education background | |
| Type of Education | Numbers (people) |
| Postgraduate | 1 |
| Undergraduate | 23 |
| Junior college | 28 |
| Below junior college | 17 |
| Total | 69 |
2. Remuneration Policy
Formulated the remuneration policy according to the position title and comprehensive industry salary standards
3. Training programs
In order to improve the quality of staff, the company has planned and targeted training activities every year. Thetraining activities for administrative personnel and technical staff mainly to improve their professional skills,management quality and ability
4. Labor outsourcing
□Applicable ?Not applicable
X. Profit distribution plan and capitalizing of common reserves planFormulation, Implementation and Adjustment of common stock Profit Distribution Policy Especially CashDividend policy during the Reporting Period
□Applicable ?Not applicable
The company is profitable during the reporting period and the parent company has positive profit available fordistribution to shareholders but no cash dividend distribution plan has been proposed
□Applicable ?Not applicable
Profit distribution plan and capitalizing of reserves for the Period
□Applicable ?Not applicable
The Company has no plans of cash dividend distributed, no bonus shares and has no share converted fromcapital reserve either for the year.XI. Implementation of the Company’s stock incentive plan, employee stock ownership plan or otheremployee incentives
□Applicable ?Not applicable
During the reporting period, the Company has no stock incentive plan, employee stock ownership plan or otheremployee incentives that have not been implemented.XII. Construction and implementation of internal control system during the reporting period
1. Construction and implementation of internal control
In accordance with the provision of Basic Standards for Enterprise Internal Control and its supporting guidelines,the Company renewal and improve the internal control system of the Company during the reporting period.Established a set of internal control system with scientific design, simple application and effective operation.Regularly, the Company carried out special work of system combing and optimization every year, and the work iseffectively integrated with the internal control assessment of the Company. Through the system evaluation,achieved the improvement of the system, standardization of the effectiveness of the establishment andoptimization of the process, and full implementation.
2. Details of major defects in internal control identified during the reporting period
□Yes ?No
XIII. Management and controls on the subsidiary during reporting period
| Name | Integration plans | Integration progress | Problems encountered in integration | Measures taken to resolve | Progress in solution | Follow-up solution plan |
| Not applicable | Not applicable | Not applicable | Not applicable | Not applicable | Not applicable | Not applicable |
XIV. Internal control self-appraisal report or internal control audit report
1. Self-appraisal Report of Internal Control
| Disclosure date of full internal control evaluation report | 23 April 2024 |
| Disclosure index of full internal control evaluation report | Self-Appraisal Report of Internal Control 2023 of CBC released on Juchao website |
| The ratio of the total assets of units included in the scope of evaluation accounting for the total assets on the company's consolidated financial statements | 100.00% |
| The ratio of the operating income of units included in the scope of evaluation accounting for the operating income on the company's consolidated financial statements | 100.00% |
| Defects Evaluation Standards | ||
| Category | Financial Reports | Non-financial Reports |
| Qualitative criteria | Material defect: (1) inefficiency of environment control; (2) inefficiency of internal supervision; (3) direct impact on major mistakes of investment decisions; (4) directly make the significant error in the financial statements; (5) violation of the laws, regulations, rules and other normative documents, resulting in investigation of the central government and regulatory agencies, and being sentenced to a fine or penalty, being restricted industry exit, canceling business license and being forced the closure of etc. Major defect: (1) indirect impact on major mistakes of investment decisions; (2) indirectly make the significant error in the financial statements; (3) Lack of important system; (4) violation of the laws, regulations, rules and other normative documents, resulting in investigation of the local government and regulatory agencies, and being sentenced to a fine or penalty, and being ordered to suspend business for rectification and cause the Company’s business stop of etc. General defect: other control defect besides material defect and major defect. | Material defect: (1) inefficiency of environment control; (2) inefficiency of internal supervision; (3) direct impact on major mistakes of investment decisions; (4) directly make the significant error in the financial statements; (5) violation of the laws, regulations, rules and other normative documents, resulting in investigation of the central government and regulatory agencies, and being sentenced to a fine or penalty, being restricted industry exit, canceling business license and being forced the closure of etc. Major defect: (1) indirect impact on major mistakes of investment decisions; (2) indirectly make the significant error in the financial statements; (3) Lack of important system; (4) violation of the laws, regulations, rules and other normative documents, resulting in investigation of the local government and regulatory agencies, and being sentenced to a fine or penalty, and being ordered to suspend business for rectification and cause the Company’s business stop of etc. General defect: other control defect besides material defect and major defect. |
| Quantitative standard | 1. Potential loss or potential error of total profit: (1) General defect: less than or equal to pre-tax total profit of 3%, (2) Major defect: more than pre-tax total profit of 3%( and absolute amount more than RMB 0.5 million), (3) Material defect:: more than 5% of pre-tax total profit and absolute amount more than RMB 1 million; 2. Potential loss or potential error of operating income: (1) General defect: less than or equal to operating income of 1%, (2) Major defect: more than 1% of operating income and less than or equal to 3% of operation income, (3) Material defect:: more than 3% of operating income; 3. Potential loss or potential error of total assets: (1) General defect: less than or equal to 1% of total assets, (2) Major defect: more than 1% of total profit and less than or equal to 3% of total profit, (3) Material defect:: more than 3% of total profit | 1. Potential loss or potential error of total profit: (1) General defect: less than or equal to pre-tax total profit of 3%, (2) Major defect: more than pre-tax total profit of 3%( and absolute amount more than RMB 0.5 million), (3) Material defect:: more than 5% of pre-tax total profit and absolute amount more than RMB 1 million; 2. Potential loss or potential error of operating income: (1) General defect: less than or equal to operating income of 1%, (2) Major defect: more than 1% of operating income and less than or equal to 3% of operation income, (3) Material defect:: more than 3% of operating income; 3. Potential loss or potential error of total assets: (1) General defect: less than or equal to 1% of total assets, (2) Major defect: more than 1% of total profit and less than or equal to 3% of total profit, (3) Material defect:: more than 3% of total profit |
| Amount of significant defects in financial reports | 0 | |
| Amount of significant defects in non-financial reports | 0 | |
| Amount of important defects in financial reports | 0 | |
| Amount of important defects in non-financial reports | 0 | |
2. Auditing report of internal control
?Applicable □Not applicable
| Deliberations in Audit Report of Internal Control | |
| We considers that China Bicycle Company (Holdings)Co., Ltd. in line with Basic Norms of Internal Control and relevant regulations, shows an effectiveness internal control of financial report in all major aspects dated 31 December 2023. | |
| Disclosure details of audit report of internal control | Disclosed |
| Disclosure date of audit report of internal control (full-text) | 23 April 2024 |
| Opinion type of auditing report of IC | Standard unqualified |
| Whether the non-financial report had major defects | No |
Carried out modified opinion for internal control audit report from CPA
□Yes ?No
The internal control audit report, issued by CPA, has concerted opinion with self-evaluation report, issued fromthe Board?Yes □NoXV. Rectification of Self-examination Problems in Special Governance Actions in Listed CompanyNot applicable
Section V. Environmental and Social ResponsibilityI. Major environmentalThe listed Company and its subsidiary whether belongs to the key sewage units released from environmentalprotection department
□Yes ?No
Administrative punishment for environmental problems during the reporting period
| Company name or subsidiary name | Reason for punishment | Violation | Punishment result | Impact on the production and operation of listed company | The company’s rectification measures |
| Not applicable | Not applicable | Not applicable | Not applicable | Not applicable | Not applicable |
Other environmental information disclosed refer to key pollutersNot applicableMeasures taken to reducing the carbon emissions during the reporting period and their effectiveness
□Applicable ?Not applicable
Reasons for not disclosing other environmental informationNot applicableII. Social responsibilityDuring the reporting period, the company conscientiously fulfilled its corporate social responsibility, paidattention to protecting the interests of shareholders, especially minority shareholders; Treated suppliers, customersand consumers with integrity; Earnestly fulfilled the responsibilities and obligations to the society, shareholders,employees and other stakeholders, created a harmonious environment for enterprise development, and realized thecommon development of the enterprise and stakeholders.
1. Protection of shareholders' rights and interests
The company strictly complies with the provisions of relevant laws and regulations such as the Company Law, theSecurities Law and the Governance Code for Listed Companies, continuously improves the corporate governancestructure, adheres to handing over the important matters to the resolutions of the shareholders' meeting, providesconvenience for medium and small investors to participate in the shareholders' meeting, fully listens to the smalland medium-sized investors’ reasonable advice on the company's development and governance, and safeguardsthe legitimate rights and interests of shareholders.In 2023, the board of directors of the company convened 4 shareholders' meetings, the meeting adopted thecombination of on-site voting and online voting, the votes of small and medium investors were counted separately,provided convenience for the majority of investors to participate in the voting at the shareholders' meeting, and
ensured the participation right and supervision right of the small and medium-sized investors.In 2023, the company strengthened communication with investors, especially investors from the public, answeredquestions about which the public and investors concerned, and ensured the investors' right to know in line with theInformation Disclosure Affairs Management System and Reception and Promotion Work System and by means ofvarious forms such as the interactive platform of Shenzhen Stock Exchange, hotline of the company’s securitiesaffairs department, and so on.On 17 May 2023, the company held the 2022 annual performance briefing, in which the company made onlinecommunication with investors on the company's performance, operating conditions and other issues of concern toinvestors. A total of 4 questions were raised by investors during the briefing, which were answered by directorsand senior management personnel.On November 15, 2023, the Company participated in the collective reception day for investors of the listedcompanies in Shenzhen in 2023, and had an online exchange with investors on issues such as operatingconditions and performance commitments that investors concern about. During the reception day, all thedirectors and senior management responded to the questions raised by investors.
The Company is committed to effectively protecting the rights and interests of investors by improving thecorporate governance structure, improving the level of information disclosure and investor relation management,and carrying out investor education, and guiding investors to form a value investment concept through true andeffective communication. In order to effectively ensure the smooth service channels for investors, the Companyhas arranged full-time staff to answer investors' hotline calls and answer questions from the interactive platform.Relevant staff patiently analyze the announcement information to help investors keep abreast of the Company'ssituation.
2. Protection of workers' rights and interests
The company adheres to the people-oriented, comprehensively implements the Labor Law and Labor ContractLaw, attaches great importance to guarantee of the employees' rights and interests, at the same time, establishesgood communication channels throughout the whole process of staff management and care, pays attention to staffgrowth, improves the staff overall quality, cultivates excellent internal training culture system, creates a goodlearning environment. Meanwhile, the company pays attention to enriching the spiritual life of employees,regularly carries out staff activities, and improves team cohesion. In accordance with the Labor Contract Law ofthe People's Republic of China and other relevant national and local labor laws and regulations, the company signslabor contracts with employees to protect their rights and interests. The company and its subsidiaries strictlyimplement the national employment system, labor protection system, social security system and medical securitysystem, and pay the housing provident fund, medical insurance, endowment insurance, unemployment insurance,work-related injury insurance and maternity insurance for employees according to the state regulations. Thecompany adheres to corporate culture of efficient coordination, people-oriented, on-demand training, training bylevel, and echelon training. The company establishes internal knowledge sharing system, promotes informationand knowledge exchange among various modules of the company, and improves team coordination ability. Itencourages employees to participate in continuing education and enhances the knowledge structure optimizationand professional quality promotion of workers at various positions.
3. Protection of rights and interests of suppliers, customers and consumers
The company actively organizes and carries out customer management, takes measures to ensure the rights and
interests of customers and actively promotes customer satisfaction and service excellence. It makes full use of therich social resources in the market, and establishes a good partnership with suppliers. The company promises notto abuse or misuse consumer information for the protection of rights and interests of consumers.III. Consolidating and expanding the achievements of poverty alleviation and rural revitalizationNil
Section VI. Important Events
I. Implementation of commitment
1. Commitments completed in Period and those without completed till end of the Period from actual controller, shareholders, related parties, purchaserand companies?Applicable □Not applicable
| Commitment | Commitment party | Type | Content | Date | Term | Implementation |
| Commitments made in acquisition report or report on changes in equity | Wansheng Industrial Holdings (Shenzhen) Co., Ltd. and Wang Shenghong | Commitment to maintain the independence of listed company | After the completion of the non-public offering, within the scope of shareholder rights that can be exercised by Wansheng Industrial \ I myself, the independence of the listed company in terms of personnel, assets, finance, organization and business will be guaranteed as follows: I Personnel independence 1. Ensure that the general manager, deputy general manager, chief financial officer, secretary of the board and other senior executives of the listed company work full-time in the listed company and do not hold other positions except director and supervisor in other enterprises controlled by Wansheng Industrial \ I myself and do not receive salary in other enterprises controlled by Wansheng Industrial \ I myself. 2. Ensure that the financial personnel of the listed company are independent and do not take part-time jobs or receive remuneration in other enterprises controlled by Wansheng Industrial \I myself. 3. Ensure that the listed company has a complete and independent labor, personnel and salary management system, which is completely independent from other enterprises controlled by Wansheng Industrial \I myself. II Assets independence 1. Ensure that the listed company has independent and complete assets, all assets of the listed company are under the control of the listed company, and are independently owned | 7 November 2022 | Valid for long term | Normal performance |
| functions and powers in accordance with laws, regulations and the company's articles of association. 3. Ensure that the listed company has an independent and complete organizational structure, and there is no confusion between the listed company and other enterprises controlled by Wansheng Industrial \ I myself . VI Ensure that the listed Company is otherwise independent from Wansheng Industrial \ I myself and other enterprises under my control In case of any breach of the above commitments, thus causing economic losses to the listed company, Wansheng Industrial \ I myself will indemnify the listed company. | ||||||
| Commitments made in acquisition report or report on changes in equity | Wansheng Industrial Holdings (Shenzhen) Co., Ltd and Wang Shenghong | Commitment to avoid competition in the same industry | 1. Wansheng Industrial \ I myself do not, and will not, directly or indirectly engage in any business or activity at home and abroad which is the same, or similar to the existing business of the listed company and which constitutes or may constitute direct or indirect competition to the existing business of the listed company in any aspect in any way (including but not limited to sole proprietorship, joint venture, cooperation and joint venture), nor provides any assistance in fund, business and management or provides any technical information, business operation, sales channels and other trade secrets to enterprises, institutions or other economic organizations competing with the listed company's existing business in any way; 2. Wansheng Industrial \ I myself do not establish or acquire any business entity that is engaged in the same or similar business as the listed company's existing business, or any company, enterprise or other institution or organization that competes with the listed company's existing business in any aspect; 3. From the date of issuance of this letter of commitment, if any business opportunity obtained by Wansheng Industrial \ I myself from any third party constitutes or may constitute material competition with the existing business of the listed company, Wansheng Industrial \ I myself will immediately notify the listed company and try its best to transfer such business opportunity to the listed company; 4. This letter of commitment takes effect from the date of issuance and remains valid and irrevocable during the period when Wansheng Industrial \ I myself am a shareholder holding more than 5% equity of the list company. | 7 November 2022 | Valid for long term | Normal performance |
| 5. In case of direct or indirect economic losses caused to the listed company due to its failure to fulfill the above commitments, Wansheng Industrial \ I myself shall compensate the listed company for all the losses suffered thereby. | ||||||
| Commitments made in acquisition report or report on changes in equity | Wansheng Industrial Holdings (Shenzhen) Co., Ltd and Wang Shenghong | Commitment on regulating the related transactions | 1. As of the date of issuance of this letter of commitment, there was no related transaction between Wansheng Industrial/I myself and other companies controlled by Wansheng Industrial/I myself and the listed company or any related transaction that should be disclosed in accordance with laws and regulations but not disclosed . 1. Upon completion of the transaction, Wansheng Industrial/I myself and other companies controlled by Wansheng Industrial/I myself will avoid and reduce related transactions with the listed company as far as possible in accordance with laws, regulations and other normative documents. For related transactions that cannot be avoided or occur for reasonable reasons, Wansheng Industrial/I myself and other companies controlled by Wansheng Industrial/I myself will follow the market principles of justice, fairness and openness, sign agreements with the listed company according to law, perform legal procedures, comply with relevant laws, regulations, other normative documents and the articles of association of the listed company, and perform relevant internal decision-making procedures in accordance with the law and timely fulfill the obligations of information disclosure, ensure that the pricing of related transactions is fair and reasonable and the trade terms are fair, guarantee not to use related transactions to illegally transfer the funds and profits of the listed company nor to use such transactions to engage in any behavior that damages the legitimate rights and interests of the listed company and other shareholders. 3. This Commitment shall remain valid during the period when Wansheng Industrial/I myself serve as the direct/indirect controlling shareholder/actual controller of the listed company. Wansheng Industrial/I myself guarantee to strictly fulfill all commitments in this letter of commitment. If any loss is caused to the listed company due to violation of such commitments, Wansheng Industrial/I myself will bear the corresponding liability for compensation. | 7 November 2022 | Valid for long term | Normal performance |
| Commitments made at IPO or | Wansheng Industrial | Commitment on shares | After the completion of this non-public offering, the shares subscribed by Wansheng Industrial is not allowed to be transferred within 36 months from the date of listing of this | 7 November | 36 months | Normal performance |
| refinancing | Holdings (Shenzhen) Co., Ltd and Wang Shenghong | restriction | stock issue. The non-public offering of shares of the company acquired by the issuing object and the shares acquired as a result of the company's allocation of stock dividends and the capital reserve converted into share capital shall also comply with the above share lock-in arrangement. After the expiration of the restriction period, it will be subject to the relevant regulations of China Securities Regulatory Commission and Shenzhen Stock Exchange. | 2022 | ||
| Commitments made at IPO or refinancing | Wansheng Industrial Holdings (Shenzhen) Co., Ltd and Wang Shenghong | Performance compensation commitment | For the next three years after the completion of the non-public offering of shares and the completion of the adjustment of the board of directors and the board of supervisors of Shenzhen China Bicycle by Wansheng Industrial, the net profit of the listed company shall be no less than 30 million yuan, 35 million yuan and 40 million yuan respectively, that is, the cumulative net profits shall be 105 million yuan. If the actual cumulative net profits of the listed company fails to reach the cumulative net profits of the listed company in any year within the performance commitment period, Wansheng Industrial shall compensate the listed company in cash within ten working days after the issuance of audit report of the listed company in the current year within the performance commitment period. The amount of compensation for the current year shall be calculated as follows: Amount payable in the current year = Cumulative net profit committed by the end of the current period - Cumulative net profit realized by the end of the current period - Cumulative amount compensated (if any) | 7 November 2022 | 1 Jan. 2023-31 December 2025 | Normal performance |
| Commitments made at IPO or refinancing | Wansheng Industrial Holdings (Shenzhen) Co., Ltd and Wang Shenghong | Commitment on dilution of the immediate return on non-public offering of A share and measures to be taken | 1. Do not interfere with the company's operation and management activities beyond its authority, and do not occupy the company's interests; 2. Effectively perform the relevant measures formulated by the company to fill out the returns and fulfill any commitments made to fill out the returns. 3. From the issuance date of this Commitment to the completion of the non-public offering of shares of the company, if the China Securities Regulatory Commission makes other new regulations on filling out the return measures and commitments, and the above-mentioned commitments cannot meet such regulations of the China Securities Regulatory Commission, I myself promise to issue supplementary commitments in accordance with the | 7 November 2022 | Valid for long term | Normal performance |
| latest regulations of the China Securities Regulatory Commission at that time; 4. As one of the subjects responsible for filling out the return measures, if I myself violate the above commitments or refuse to perform the above commitments, I myself agree that China Securities Regulatory Commission, Shenzhen Stock Exchange and other securities regulatory authorities punish me or take relevant management measures according to the relevant regulations and rules formulated or issued by them. | ||||||
| Commitments made at IPO or refinancing | Wansheng Industrial Holdings (Shenzhen) Co., Ltd and Wang Shenghong | Commitment not to initiate major assets reorganization or assets acquisition | Within 12 months after the completion of this issuance, Wansheng Industrial did not plan to launch major asset reorganization, asset acquisition and other major matters affecting the stock price of the listed company, and there was no plan to realize the reorganization and listing step by step through cash subscription and asset acquisition. | 7 November 2022 | 12 months | Normal performance |
| Commitments made at IPO or refinancing | Shenzhen China Bicycle Company (Holdings) Co., Ltd. | Commitment not to initiate major assets reorganization or assets acquisition | Within 12 months after the completion of this issuance, Wansheng Industrial did not plan to launch major asset reorganization, asset acquisition and other major matters affecting the stock price of the listed company, and there was no plan to realize the reorganization and listing step by step through cash subscription and asset acquisition. | 7 November 2022 | 12 months | Normal performance |
| Commitments made at IPO or refinancing | Director and senior executive of the Company | Commitment on dilution of the immediate return on non-public offering of A share and measures to be taken | 1. Promise not to transfer benefits to other units or individuals free of charge or under unfair conditions, and not to damage the interests of the company by other means; 2. Promise to restrict my position-related consumption behavior; 3. Promise not to use the company's assets to engage in investment and consumption activities unrelated to the performance of duties; 4. Promise that the remuneration system formulated by the board of directors or the compensation committee will be linked to the implementation of the company's measures to fill out the returns; 5. Promise that the venting conditions of the future equity incentive plan will be linked to the implementation of the company's measures to fill out the returns if the company implements the equity incentive plan in the future, ; 6. From the issuance date of this Commitment to the completion of the non-public offering of shares of the company, if the China Securities Regulatory Commission makes other new regulations on filling out the return measures and commitments, and the above-mentioned | 7 November 2022 | Valid for long term | Normal performance |
| commitments cannot meet such regulations of the China Securities Regulatory Commission, I myself promise to issue supplementary commitments in accordance with the latest regulations of the China Securities Regulatory Commission at that time; 7. As one of the subjects responsible for filling out the return measures, if I myself violate the above commitments or refuse to perform the above commitments, I myself agree that China Securities Regulatory Commission, Shenzhen Stock Exchange and other securities regulatory authorities punish me or take relevant management measures according to the relevant regulations and rules formulated or issued by them. | |||
| Whether commitments are fulfilled on time | Yes | ||
2. Concerning assets or project of the Company, which has profit forecast, and reporting period still in forecasting period, explain reasons of reaching theoriginal profit forecast
□Applicable ?Not applicable
II. Non-operational fund occupation from controlling shareholders and its related party
□Applicable ?Not applicable
No non-operational fund occupation from controlling shareholders and its related party in period.III. External guarantee out of the regulations
□Applicable ?Not applicable
No external guarantee out of the regulations occurred in the period.IV. Statement on the latest “modified audit report” by BOD
□Applicable ?Not applicable
V. Explanation from Board of Directors, Supervisory Committee and Independent Directors (ifapplicable) for “Qualified Opinion” that issued by CPA
□Applicable ?Not applicable
VI. Explanation of the changes in accounting polices, accounting estimates or correction of significantaccounting errors compared with the financial report of the previous year?Applicable □Not applicable
1. Significant changes in accounting policy
| Content and reason for changes in accounting policy | The name of the report item that is significantly affected | Affected amount |
| In November 2022, the Ministry of Finance issued the Interpretation No. 16 of Accounting Standards for Business Enterprises (No. 31[2022] Cai Kuai) (hereinafter referred to as "Interpretation No. 16"), in which the“Accounting treatment of deferred income tax related to assets and liabilities arising from a single transaction not applicable to the initial recognition exemption"will come into effect on January 1, 2023. The Company shall commence the implementation from the date of the regulation. | See other notes for details | See other notes for details |
Other explanations:
On November 30, 2022, the Ministry of Finance issued Interpretation No. 16.The Company shall implementthe "Accounting treatment of deferred income tax related to assets and liabilities arising from a single transactionnot applicable to the initial recognition exemption" from January 1, 2023.
Interpretation No. 16 clarifies that for a single transaction that is not a business combination, thetransaction does not affect the accounting profit or the taxable income (or deductible loss) at the time of thetransaction, and the assets and liabilities initially recognized result in the same amount of taxable temporarydifferences and deductible temporary differences, for the taxable temporary differences and deductibletemporary differences arising from the initial recognition of assets and liabilities, the corresponding deferred taxliabilities and deferred tax assets that are recognized separately when the transaction occursshall be inaccordance with Accounting Standard for Business Enterprises No. 18 - Income Tax and other relevantprovisions. The provisions will come into force on January 1, 2023, and for the above-mentioned transactionsthat occur from the beginning of the earliest period of the financial report presentation period and the effectivedate of this interpretationfor the first time of implementation of above-said regulation, the Company shall adjustthe cumulative impact to the opening retained earnings and other relevant financial statement items presentedfor the earliest period of the financial report.The adoption of Interpretation No. 16 by the Company does not have a material impact on the Company'sfinancial condition and operating results.
2. Changes in significant accounting estimates
There are no changes in the Company's significant accounting estimates during the reporting period.
3. Correction of accounting errors in the previous period
During the reporting period, the Company does not make any material corrections to prior period accountingerrors.VII. Compare with last year’s financial report; explain changes in consolidation statement’s scope?Applicable □Not applicableDuring the reporting period, Fujian Huaxinbao Jewelry Co., Ltd., Hainan Shenhua Industrial Co., Ltd.,Shenzhen Huabao Zhenxuan Jewelry Co., Ltd. and Shenzhen Xinsen Precision Manufacturing Co., Ltd. werenewly added.VIII. Appointment and non-reappointment (dismissal) of CPAAccounting firm appointed
| Name of domestic accounting firm | Huaxing Certified Public Accountants （LLP） |
| Remuneration for domestic accounting firm (in 10 thousand Yuan) | 45 |
| Continuous life of auditing service for domestic accounting firm | 1 |
| Name of domestic CPA | Huang Guoxiang, Fu Zhitao |
| Continuous life of auditing service for domestic accounting firm | 1 |
Re-appointed accounting firms in this period?Yes □NoWhether to hire an accounting firm during the audit
□Yes ?No
Whether the change of accounting firm has fulfilled the examination and approval procedures
?Yes □NoDetailed explanation of the change of employment and change of the accounting firmIn December 2023, the Company held the 3rd meeting of the Audit Committee of the Eleventh Board ofDirectors, the 9th (interim) meeting of the Eleventh Board of Directors and the 3rd General Meeting ofShareholders in 2023, respectively, which deliberated and passed the Proposal on Proposed Change of theAccounting Firm, and agreed to change and hire Huaxing Certified Public Accountants (LLP) as the Company'sfinancial report audit and internal control audit institution in 2023 for a period of one year.Appointment of internal control auditing accounting firm, financial consultant or sponsor?Applicable □Not applicable
1. During the reporting period, the company engaged Huaxing Certified Public Accountants （LLP） as the
auditing organ for internal control of the Company, and it is expected to pay 150,000 yuan for internal controlauditing.
2. Due to the non-public issuance of shares, the Company hired Sinolink Securities Co., Ltd. as the sponsor
institution. During the reporting period, Sinolink Securities performed continuous supervision duties, withthe continuous supervision period is from November 7, 2022 to December 31, 2023.IX. Particular about delisting after annual report disclosed
□Applicable ?Not applicable
X. Bankruptcy reorganization
□Applicable ?Not applicable
No bankruptcy reorganization for the Company in reporting periodXI. Significant lawsuits and arbitration of the Company?Applicable □Not applicable
| Lawsuits (arbitration) | Amount involved (in 10 thousand Yuan) | Resulted an accrual liability (Y/N) | Progress | Trial result and influence | Execution of judgment | Disclosure date | Disclosure index |
| Contract dispute over the urban renewal project of Zhonghua Garden Phase II- Plaintiff(Shenzhen Jianzhi Industrial Development Co., Ltd); | 3,085.9 | No | The second instance has ruled that the defendant returned the deposit of RMB 10 million and interest to the plaintiff. | The final ruling of this lawsuit will not have a significant adverse impact on the Company's current profits or future profits | Execution completed | August 23,2022 | Juchao Website (www.cninfo.com.cn) (2022-002) |
| Defendant (Shenzhen China Bicycle Company (Holdings) Co., Ltd. | |||||||
| Counter-claim in the contract dispute on urban renewal project of Zhonghua Garden Phase II- Plaintiff(Shenzhen China Bicycle Company (Holdings) Co., Ltd.); Defendant (Shenzhen Jianzhi Industrial Development Co., Ltd) | 600 | No | The second instance has ruled that the plaintiff's counterclaim was rejected | The second instance has ruled that the plaintiff's counterclaim was rejected | Execution completed | August 23, 2022 | Juchao Website (www.cninfo.com.cn) (2022-019) |
| Sale & purchase contract dispute- Plaintiff (Shenzhen China Bicycle Company (Holdings) Co., Ltd.); Defendant(GuangshuiJiaxu Energy Technology Co., Ltd.) | 1,834.81 | No | The first instance ruled in favor of the Company andit’s entered the execution stage | Made 80% of the bad debt provision in 2021-2022. And the provision for bad debts made in 2023 is up to 90% | Under execution | April 21,2023 | Juchao Website (www.cninfo.com.cn) (2023-007) |
Sale &purchasecontractdispute-Plaintiff(ShenzhenEmmelleIndustrialCo., Ltd);Defendant(GuangshuiJiaxu EnergyTechnologyCo., Ltd.)
| 661.91 | No | The first instance ruled in favor of the Company andit’s entered the execution stage | Made 80% of the bad debt provision in 2021-2022. And the provision for bad debts made in 2023 is up to 90% | Under execution | April 21,2023 | Juchao Website (www.cninfo.com.cn) (2023-007) |
XII. Penalty and rectification
□Applicable ?Not applicable
The Company had no penalty and rectification in the PeriodXIII. Integrity of the company and its controlling shareholders and actual controllers
□Applicable ?Not applicable
XIV. Major related transaction
1. Related transaction with routine operation concerned
?Applicable □Not applicable
| Related party | Relationship | Type of related transaction | Content of related transaction | Pricing principle | Related transaction price | Related transaction amount (in 10 thousand Yuan) | Proportion in similar transactions | Trading limit approved (in 10 thousand Yuan) | Whether over the approved limited or not (Y/N) | Clearing form for related transaction | Available similar market price | Date of disclosure | Index of disclosure |
| Fuzhou Zuankinson Jewelry Co., Ltd. | The enterprises controlled by the controlling subsidiary of the Company with 35% stock participated | Related transaction with routine operation concerned | Sale of goods to related party | Pricing based on market price according to the principle of fairness and impartiality | Market pricing | 69,859,442.52 | 36.74% | 7,000 | No | Settlement in cash | Not applicable | November 1,2023 | Found more in the “Recognition of the Daily Related Transactions for year of 2022 and Expected Daily Related Transactions for 2023” on Juchao Website (www.cninfo.com.cn) |
| Fuzhou Rongrun Jewelry Co., Ltd. | The enterprises controlled by the affiliates of the controlling subsidiary of the Company with 35% stock participated | Related transaction with routine operation concerned | Sale of goods to related party | Pricing based on market price according to the principle of fairness and impartiality | Market pricing | 119,775,927.8 | 63.00% | 12,000 | No | Settlement in cash | Not applicable | November 1,2023 | Found more in the “Recognition of the Daily Related Transactions for year of 2022 and Expected Daily Related Transactions for 2023” on Juchao Website (www.cninfo.com.cn) |
| Shenzhen Zuankinson Jewelry Gold Supply Chain Co., | The enterprises controlled by the affiliates of the | Related transaction with routine operation concerne | Sale of goods to related party | Pricing based on market price according to the | Market pricing | 484,376.29 | 0.25% | 0 | No | Settlement in cash | Not applicable | Not applicable |
| Ltd. | controlling subsidiary of the Company with 35% stock participated | d | principle of fairness and impartiality | ||||||||||
| Total | -- | -- | 190,119,746.61 | -- | 19,000 | -- | -- | -- | -- | -- | |||
| Detail of sales return with major amount involved | Not applicable | ||||||||||||
| Report the actual implementation of the daily related transactions which were projected about their total amount by types during the reporting period (if any) | Not applicable | ||||||||||||
| Reasons for major differences between trading price and market reference price (if applicable) | Not applicable | ||||||||||||
| Note: (1) According to the Rules for the Listing of Stocks on the Shenzhen Stock Exchange, based on the prudent consideration, the Company determined that 12 months before the industrial and commercial registration of the purchase of minority shareholders' equity in the holding subsidiary, Fuzhou Zuanjinsen and Fuzhou Rongrun were related parties of the Company, and the relevant transaction that occurred was related party transaction. Based on this determination, the statistical period of related party transaction in the current period is the whole year of 2023, and the total amount of related party transactions is RMB 190,119,746.61. (2) According to the accounting rules and the notes to the audit report, the industrial and commercial registration of the Company's purchase of minority shareholders' equity in the holding subsidiary was completed in early August 2023. Based on that determination, the total amount of related party transactions in the statistical period from January to July 2023 is RMB 109,158,498.12. | |||||||||||||
2. Related transactions by assets acquisition and sold
?Applicable □Not applicable
| Related party | Relationship | Type | Contents | Pricing | Carrying value of assets transferred (10,000 yuan) | Appraised value of assets transferred (10,000 yuan) (if any) | Transferred price (10,000 yuan) | Settlement terms | Gain/loss on trading(10,000 yuan) | Date of disclosure | Index of disclosure |
| Shenzhen Zuankinson Jewelry Gold | Shenzhen Zuankinson Jewelry Gold Supply | Purchase of equity | Purchasing the minority shareholders’ equity from | Based on the assessment report ‘Asset Appraisal Report | 1418.19 | 2,555 | 2,555 | Settlement in cash | 0 | 2023-06-07 | Refer to (www.cninfo.com.cn) for details: Announcement on Purchase of the Minority |
| Supply Chain Co., Ltd | Chain Co., Ltd is the shareholder of Shenzhen Xinsen Jewelry Gold Supply Chain Co., Ltd who hold 35% shares-the controlling subsidiary of the Company, | controlling subisdiary | of the Proposed Equity Transfer of Shenzhen Xinsen Jewelry Gold Supply Chain Co., Ltd Involving the Value of Certain Shareholders’ Interests (YW Appraisal Zi[2023] No. 041) issued by Yu Wei International Asset Appraisal (Shenzhen ) Co., Ltd., the income method has been selected in the report | Interest in Controlling Subsidiary and Related Transactions (Notice No.: 2023-019) | ||
| Reasons for major differences between transferred price and carrying value or appraised value (if any) | Based on the assessment report ‘Asset Appraisal Report of the Proposed Equity Transfer of Shenzhen Xinsen Jewelry Gold Supply Chain Co., Ltd Involving the Value of Certain Shareholders’ Interests ’’(YW Appraisal Zi[2023] No. 041) issued by Yu Wei International Asset Appraisal (Shenzhen ) Co., Ltd., the income method has been selected in the report. The Specific assessment are as follows: at the valuation date, carrying value of total assets under Shenzhen Xinsen Jewelry Gold Supply Chain Co., Ltd was 44.0619 million yuan; carrying value of total liabilities amounted to 4.6527 million yuan; carrying value of total equity amounted to 39.4092 million yuan. At the valuation date, carrying value of total equity under Shenzhen Xinsen Jewelry Gold Supply Chain Co., Ltd was 73 million yuan, the appraisal value increased by 33.5908 million yuan, or 85.24%. among which, the 35% equity held by Shenzhen Zuankinson Jewelry Gold Supply Chain Co., Ltd was evaluated as 25.55 million yuan. The appreciation was mainly due to the items that not show in the financial statement are considered in the assessment from the perspective of the overall profitability of the business, including customer resources, human resources and management efficiency. | |||||
| Impact on operation result and financial status | The minority equity purchasing is beneficial to the further resource integration, and optimize the overall resource allocation in a better way, and enhance the competitiveness and comprehensive strength in field of jewelry and gold business. Capital sources are from the owned fund of the Company, and the matter will not have major adverse impact on operation of the Company, and there is no damage to the listed company, especially to the small and medium-sized shareholders. | |||||
| Performance during the reporting period if relevant trading involves a performance covenant | Not applicable | |||||
3. Main related transactions of mutual investment outside
□Applicable ?Not applicable
No main related transactions of mutual investment outside for the Company in reporting period.
4. Contact of related credit and debt
?Applicable □Not applicableWhether exist non-operating contact of related credit and debt or not?Yes □NoClaim receivable from related party
| Related party | Relationship | Causes of formation | Whether has non-business capital occupying or not | Balance at period-begin(10 thousand Yuan) | Current amount increased(10 thousand Yuan) | Current recovery(10 thousand Yuan) | Interest rate | Current interest(10 thousand Yuan) | Balance at period-end(10 thousand Yuan) |
| Wansheng Industrial Holdings(Shenzhen) Co., Ltd. | Controlling shareholder | Performance commitment | No | 0.00 | 1209.81 | 0.00 | 0.00% | 0.00 | 1209.81 |
| The impact of the related claims on the company's operating results and financial position | Due to the failure of the controlling shareholder, Wansheng Industrial Holdings (Shenzhen) Co., Ltd., to complete its performance commitment in 2023, the performance compensation of RMB 12,098,051.76 receivable by Shenzhen China from Wansheng in 2023 will be included in the capital reserve-share capital premium. | ||||||||
Debts payable to related party
| Related party | Relationship | Causes of formation | Balance at period-begin(10 thousand Yuan) | Current amount increased(10 thousand Yuan) | Current amount returned (10 thousand Yuan) | Interest rate | Current interest(10 thousand Yuan) | Balance at period-end(10 thousand Yuan) |
| Shenzhen Guosheng Energy Investment Development Co., Ltd. | Shareholder with over 5% shares held | Subsidiary Emmelle loan | 650 | 0 | 0 | 0.00% | 0 | 650 |
| Influence on operation result and financial statue of the Company from related debts | N/A | |||||||
5. Contact with the related finance companies
□Applicable ?Not applicable
There are no deposits, loans, credits or other financial business between the finance companies with associatedrelationship and related parties
6. Transactions between the finance company controlled by the Company and related parties
□Applicable ?Not applicable
There are no deposits, loans, credits or other financial business between the finance companies controlled by theCompany and related parties
7. Other material related transactions
□Applicable ?Not applicable
The company had no other material related transactions in reporting period.XV. Significant contract and implementations
1. Trusteeship, contract and leasing
(1) Trusteeship
□Applicable ?Not applicable
No trusteeship occurred in reporting period.
(2) Contract
□Applicable ?Not applicable
No contract occurred in reporting period.
(3) Leasing
□Applicable ?Not applicable
No leasing occurred in reporting period.
2. Major guarantee
□Applicable ?Not applicable
No major guarantee occurred in reporting period.Not applicable
3. Entrust others to cash asset management
(1) Trust financing
□Applicable ?Not applicable
No trust financing occurred in reporting period.
(2) Entrusted loans
□Applicable ?Not applicable
No entrusted loans occurred in reporting period.
4. Other material contracts
□Applicable ?Not applicable
No other material contracts occurred in reporting period.XVI. Explanation on other significant events
□Applicable ?Not applicable
No explanation of other important events in reporting period.
XVII. Significant event of subsidiary of the Company
□Applicable ?Not applicable
Section VII. Changes in Shares and Particulars about ShareholdersI. Changes in Share Capital
1. Changes in Share Capital
In Share
| Before the Change | Increase/Decrease in the Change (+, -) | After the Change | |||||||
| Amount | Proportion | New shares issued | Bonus shares | Capitalization of public reserve | Others | Subtotal | Amount | Proportion | |
| I. Restricted shares | 137,842,262 | 20.00% | 0 | 0 | 0 | -5,276 | -5,276 | 137,836,986 | 20.00% |
| 1. State-owned shares | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% |
| 2. State-owned legal person’s shares | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% |
| 3. Other domestic shares | 137,842,262 | 20.00% | 0 | 0 | 0 | -5,276 | -5,276 | 137,836,986 | 20.00% |
| Including: Domestic legal person’s shares | 137,836,986 | 20.00% | 0 | 0 | 0 | 0 | 0 | 137,836,986 | 20.00% |
| Domestic natural person’s shares | 5,276 | 0.00% | 0 | 0 | 0 | -5,276 | -5,276 | 0 | 0.00% |
| 4. Foreign shares | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% |
| Including: Foreign legal person’s shares | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% |
| Foreign natural person’s shares | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% |
| II. Unrestricted shares | 551,342,671 | 80.00% | 0 | 0 | 0 | 5,276 | 5,276 | 551,347,947 | 80.00% |
| 1. RMB Ordinary shares | 302,979,689 | 43.96% | 0 | 0 | 0 | 5,276 | 5,276 | 302,984,965 | 43.96% |
| 2. Domestically listed foreign shares | 248,362,982 | 36.04% | 0 | 0 | 0 | 0 | 0 | 248,362,982 | 36.04% |
| 3. Overseas listed foreign shares | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% |
| 4. Others | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% |
| III. Total shares | 689,184,933 | 100.00% | 0 | 0 | 0 | 0 | 689,184,933 | 100.00% |
Reasons for share changed?Applicable □Not applicableSupervisor of the 9
thSupervisory Committee Mr. Zheng Zhonghuan was outgoing for the offer-term expireddated November 28, 2022.According to the Management Regulation of the Shares held by Director, Supervisorand Senior Executives of the Listed Companies and their Changes, the shares held by supervisor of theCompany shall not be transferred within 6 months after their resignation. As of the current period end, sharesheld by Mr. Heng Zhonghuan were unlocked, resulting in a decrease of 5,276 restricted shares.Approval of share changed
□Applicable?Not applicable
Ownership transfer of share changed
□Applicable?Not applicable
Progress of shares buy-back
□Applicable?Not applicable
Implementation progress of reducing holdings of shares buy-back by centralized bidding
□Applicable?Not applicable
Influence on the basic EPS and diluted EPS as well as other financial indexes of net assets per share attributableto common shareholders of Company in latest year and period
□Applicable?Not applicable
Other information necessary to disclose or need to disclosed under requirement from security regulators
□Applicable?Not applicable
2. Changes of lock-up(restricted) shares
?Applicable □Not applicable
In Share
| Shareholder | Shares restricted at period-begin | Number of shares restricted in the Period | Number of shares released in the Period | Shares restricted at period-end | Cause of restriction | Dated of released |
| Zheng Zhonghuan | 5,276 | 0 | 5,276 | 0 | Executive lock-up stock (Supervisor) | 6 months after outgoing when session expired |
| Total | 5,276 | 0 | 5,276 | 0 | -- | -- |
II. Securities issuance and listing
1. Security offering (without preferred stock) in Reporting Period
□Applicable ?Not applicable
2. Changes of total shares and shareholders structure as well as explanation on changes of assets andliability structure
□Applicable ?Not applicable
3. Existing internal staff shares
□Applicable ?Not applicable
III. Shareholders and actual controller of the Company
1. Amount of shareholders and particulars about shares holding
In Share
| Total common shareholders at end of the Period | 40,022 | Total common shareholders at end of last month before annual report disclosed | 75,669 | Total preferred shareholders with voting rights recovered at end of reporting period (if applicable) (found in note 8) | 0 | Total preferred shareholders with voting rights recovered at end of last month before annual report disclosed (if applicable) (found in note 8) | 0 | |
| Particulars about shares held above 5% by shareholders or top ten shareholders（Excluding shares lent through refinancing) | ||||||||
| Full name of Shareholders | Nature of shareholder | Proportion of shares held | Total shareholders at the end of report period | Changes in report period | Amount of restricted shares held | Amount of un-restricted shares held | Information of shares pledged, tagged or frozen | |
| State of share | Amount | |||||||
| Wansheng Industrial Holdings (Shenzhen) Co., Ltd. | Domestic non-state-owned legal person | 20.00% | 137,836,986 | 0 | 137,836,986 | 0 | Not applicable | 0 |
| Shenzhen Guosheng Energy Investment Development Co., Ltd. | Domestic non-state-owned legal person | 9.22% | 63,508,747 | 0 | 0 | 63,508,747 | Not applicable | 0 |
| UOB Kay Hian (Hong Kong) Limited | Foreign legal person | 2.51% | 17,284,885 | 1,377,035 | 0 | 17,284,885 | Not applicable | 0 |
| Guosen Securities (HK) | Foreign legal person | 2.02% | 13,909,425 | 0 | 0 | 13,909,425 | Not applicable | 0 |
| Brokerage Co., Ltd. | ||||||||
| Shenwan Hongyuan Securities (Hong Kong) Co., Ltd. | Foreign legal person | 1.20% | 8,281,156 | 0 | 0 | 8,281,156 | Not applicable | 0 |
| Lhasa Xingqing Network Technology Co., Ltd. | Domestic non-state-owned legal person | 0.67% | 4,600,255 | 0 | 0 | 4,600,255 | Not applicable | 0 |
| Li Huili | Domestic nature person | 0.56% | 3,891,124 | 0 | 0 | 3,891,124 | Not applicable | 0 |
| Ge Zhiqiong | Domestic nature person | 0.44% | 3,050,452 | 0 | 0 | 3,050,452 | Not applicable | 0 |
| Xu Hongbo | Domestic nature person | 0.42% | 2,927,319 | 0 | 0 | 2,927,319 | Not applicable | 0 |
| China Merchants Securities (HK) Co., Ltd | Foreign legal person | 0.42% | 2,894,135 | 0 | 0 | 2,894,135 | Not applicable | 0 |
| Strategy investors or general corporation comes top 10 common stock shareholders due to placement of new shares (if any) (see note 3) | N/A | |||||||
| Explanation on associated relationship among the aforesaid shareholders | Li Huili, spouse of Ji Hanfei, the actual controller of Shenzhen Guosheng Energy Investment Development Co., Ltd., holding B-share of the Company on behalf of Shenzhen Guosheng Energy Investment Development Co., Ltd., other than that, the Company does not know whether the other outstanding shareholders are related and whether the shareholders belong to persons acting in concert regulated in the Administration of Disclosure of Information on the Change of Shareholders in Listed Companies. | |||||||
| Description of the above shareholders in relation to delegate/entrusted voting rights and abstention from voting rights. | N/A | |||||||
| Special note on the repurchase account among the top 10 shareholders (if any) (see note 10) | N/A | |||||||
| Particular about top ten shareholders with un-restrict shares held | ||||||||
| Shareholders’ name | Amount of un-restrict shares held at Period-end | Type of shares | ||||||
| Type | Amount | |||||||
| Shenzhen Guosheng Energy Investment Development Co., Ltd. | 63,508,747 | RMB common shares | 63,508,747 | |||||
| UOB Kay Hian (Hong Kong) Limited | 17,284,885 | Domestically listed foreign shares | 17,284,885 | |||||
| Guosen Securities (HK) Brokerage Co., Ltd. | 13,909,425 | Domestically listed foreign shares | 13,909,425 |
| Shenwan Hongyuan Securities (Hong Kong) Co., Ltd. | 8,281,156 | Domestically listed foreign shares | 8,281,156 |
| Lhasa Xingqing Network Technology Co., Ltd. | 4,600,255 | RMB common shares | 4,600,255 |
| Li Huili | 3,891,124 | 3,891,124 | |
| Ge Zhiqiong | 3,050,452 | Domestically listed foreign shares | 3,050,452 |
| Xu Hongbo | 2,927,319 | Domestically listed foreign shares | 2,927,319 |
| China Merchants Securities (HK) Co., Ltd | 2,894,135 | Domestically listed foreign shares | 2,894,135 |
| Shenzhen China Bicycle Company (Holdings) Co., Ltd. -Special account for property disposal of bankrupt enterprise | 2,602,402 | RMB common shares | 1,383,313 |
| Domestically listed foreign shares | 1,219,089 | ||
| Expiation on associated relationship or consistent actors within the top 10 un-restrict shareholders and between top 10 un-restrict shareholders and top 10 shareholders | Li Huili, spouse of Ji Hanfei, the actual controller of Shenzhen Guosheng Energy Investment Development Co., Ltd., holding B-share of the Company on behalf of Shenzhen Guosheng Energy Investment Development Co., Ltd., other than that, the Company does not know whether the other outstanding shareholders are related and whether the shareholders belong to persons acting in concert regulated in the Administration of Disclosure of Information on the Change of Shareholders in Listed Companies. | ||
| Explanation on top 10 shareholders involving margin business (if any) (see note 4) | N/A | ||
Lending of shares by the top ten shareholders participating in refinancing business
□ Applicable √ Not applicable
The top ten shareholders have changed from the previous period
□ Applicable √ Not applicable
Whether top ten common shareholders or top ten common shareholders with un-restrict shares held have a buy-back agreement dealing in reporting period.
□ Yes √ No
The top ten common shareholders or top ten common shareholders with un-restrict shares held of the Companyhave no buy –back agreement dealing in reporting period.
2. Controlling shareholder of the Company
Nature of controlling shareholders: controlled by natural personType of controlling shareholders: Legal person
| Controlling shareholder | Legal person /Responsible person | Establishment date | Organizational Code | Main business |
| Wansheng Industrial Holdings (Shenzhen) Co., Ltd. | Wang Shenghong | 10 May 2016 | 91440300MA5DCB5K9A | Investment in industry (Separately declared for specific item) |
| Shareholdings in other listed companies in and out of China that controlled and participated by the controlling shareholder during reporting period | N/A | |||
Changes of controlling shareholder in reporting period
□ Applicable √ Not applicable
No changes of controlling shareholder for the Company in reporting period.
3. Actual controller and persons acting in concert
Nature of actual controller:Domestic nature personType of actual controller: Natural person
| Actual controller | Relationship with the actual controller | Nationality | Whether to obtain the residency in other countries or regions |
| Wang Shenghong | The person himself | P.R.C | No |
| Principal occupation and position | Wang Shenghong currently is the Chairman of the Company | ||
| The listed companies in and out of China that controlled by Wang in the past 10 years | N/A | ||
Changes of actual controller in reporting period
□ Applicable √ Not applicable
No changes of controlling shareholder for the Company in reporting periodBlock Diagram of the ownership and control relations between the company and the actual controller
Actual controller controlling the Company by entrust or other assets management
□Applicable ?Not applicable
4. The total number of shares pledged by controlling shareholders or the first majority shareholder andits persons acting in concert accounts for 80% of the shares held by them
□Applicable ?Not applicable
5. Particulars about other legal person shareholders with over 10% shares held
□Applicable ?Not applicable
6. Limitation and reducing the holdings of shares of controlling shareholders, actual controllers,restructuring side and other commitment subjects
□Applicable ?Not applicable
IV. The specific implementation of shares buy-back during the reporting periodImplementation progress of shares buy-back
□Applicable ?Not applicable
Implementation progress of the reduction of repurchases shares by centralized bidding
□Applicable ?Not applicable
Section VIII. Preferred Stock
□Applicable ?Not applicable
The Company had no preferred stock in the Period.
Section IX. Corporate Bonds
□Applicable ?Not applicable
Section X. Financial ReportI. Audit Report
| Type of audit opinion | Standard Unqualified Opinion |
| Signing date of audit report | 19 April 2024 |
| Name of audit institute | Huaxing Ceritified Public Accountants（LLP） |
| Name of the CPA | Huang Gluoxiang, Fu Zhitao |
Audit report
To Shareholders of Shenzhen China Bicycle Company (Holdings) Co., Ltd.I. Auditor’s opinionWe have audited the financial statements under the name of Shenzhen China Bicycle Company (Holdings) Co.,Ltd. (hereinafter the “CBC Company”), which included the consolidated and parent company’s balance sheet asof 31 December 2023, the consolidated and parent company’s profit statement, the consolidated and parentcompany’s statement of cash flow and the consolidated statement of changes in equity of the Company and parentcompany’s for the year of 2023, together with the relevant annotations thereto.We have the view that the attached financial statements are prepared in accordance with the Accounting Standardsfor Business Enterprises in all material aspects, which reflect fairly the consolidated financial position of theCompany and parent company’s as of 31 December 2023 and the operating results and cash flow of the Companyand parent company’s for the year of 2023.II. Basis for audit opinionsWe conducted this audit under the requirements of the Auditing Standards of the Certified Public Accountant ofthe PRC. The section headed “Certified Public Accountant’s responsibility for audit of financial statement” in theaudit report has further clarified our responsibilities under these standards. Pursuant to the code of professionalconduct as certified public accountant in the PRC, we are independent of the CBC Company and have performedother responsibility as required by our professional ethics. We believe that the audit evidence obtained by us issufficient and adequate, which provides foundation for us to issue audit opinion.III. Key audit itemsKey audit items refer to those which in our opinion based on our professional judgment are the most importantissues in respect of audit for the current financial statements. We issue audit opinions on these issues in their entityand provide no opinions separately for each of them.
Key audit items identified in our audit:
1. Revenue recognition
(1) Description of items
Shenzhen China Bicycle Company is mainly engaged in businesses such as gold jewelry, bicycles andelectric vehicles, and lithium battery materials. In 2023, the main business income of Shenzhen China BicycleCompany was RMB 568,481,907.92, all of which was generated by domestic sales. Due to the large amount ofoperating income, there may be potential misstatement in the authenticity of income and whether it is includedin the appropriate accounting period have a significant impact on the operating results of Shenzhen ChinaBicycle Company in 2023. Therefore, we regard revenue recognition as a key audit item.Please refer to the accounting policies described in Note III. (XXXIII) Income and Note V (XXVI)Operating Income and Operating Costs to the financial statements.
(2) Audit response
For this key audit item, we have mainly implemented the following procedures:
① Understand, evaluate and test the effectiveness of the internal control design and operation related tosales and collection in Shenzhen China Bicycle Company;
② Check the relevant clauses of customer contracts, pay attention to whether the pricing method,acceptance method, delivery place and time limit, and settlement method have changed, and evaluate whetherthe income recognition of Shenzhen China Bicycle Company conforms to the provisions of the AccountingStandards for Business Enterprises and the disclosed accounting policies;
③ Inquire and understand the background information of major customers through open channels, such asindustrial and commercial registration materials, to confirm whether there is a potential unidentified related-party relationship between customers and Shenzhen China Bicycle Company and related parties;
④ Implement substantive analysis procedures, such as the analysis of income growth changes and theanalysis of income, cost and gross profit margin of various products compared with the previous period, andcompare them with the same industry to judge whether the income amount in the current period fluctuatesabnormally;
⑤ Combined with the audit of accounts receivable, confirm with the main customers the currenttransaction amount and balance by writing, and visit the important customers to verify the authenticity of theincome recognition of Shenzhen China Bicycle Company;
⑥ Carry out detail test, check major customer contracts, inbound and outbound orders, delivery notes anddelivery receipt records, etc.;
⑦ For the sales revenue recognized before and after the balance sheet date, sample the supportingdocuments such as the outbound order and the customer's receipt form to evaluate whether the revenue isincluded in the appropriate accounting period.
2. Impairment of accounts receivable
(1) Description of items
As of December 31, 2023, the balance of accounts receivable of Shenzhen China Bicycle Company wasRMB 221,327,608.93, and the balance of bad debt provision was RMB 25,034,475.93. Because the balance ofaccounts receivable is significant and the assessment of bad debt provision involves the management's greatjudgment, we regard the impairment of accounts receivable as a key audit item.Please refer to the accounting policies stated in Note III. (XIII) Accounts Receivable and Note V. (III)Accounts Receivable to the financial statements.
(2) Audit response
For this key audit item, we have mainly implemented the following procedures:
1. Understand and test the design and operation effectiveness of internal control related to internal controlof accounts receivable management.
2. Review the rationality and consistency of the management's accounting policies on the accrual of baddebt provision of accounts receivable, and review whether the major standards of single amount determined bythe management are reasonable.
3. For accounts receivable with bad debt provision accrued individually, select samples to obtain the basisfor management to estimate the estimated future recoverable amount, including customer credit records, defaultor delayed payment records and actual repayment after the period, and review the rationality.
4. For the accounts receivable with bad debt provision accrued according to the aging analysis method,analyze the rationality of accounting estimation of bad debt provision for accounts receivable in ShenzhenChina Bicycle Company, and select samples to test the accuracy of aging.IV. Other informationThe management of CBC Company (hereinafter, the Management) is responsible for other information, whichincludes the information covered in the Annual Report of 2023 except for the financial statements and our auditreport.Our audit opinion issued on financial statement does not cover other information, and we would not issue anyform of verification conclusion for those information.To prepare our audit on financial statement, we are required to read other information, and during the procedure,to consider that whether other information differs materially from the financial statement or the informationobtained by us during the audit or whether there exits material error.Based on the works done by us, in case we find any material error in other information, we shall report this fact.In this regard, we have nothing to report.V.Management’s responsibility for financial statement
The Management is responsible for preparing financial statements according to the Business AccountingStandards which make fair reflection, and for designing, implementing and maintaining necessary internal controlsystem to make sure that there is no material misstatement in the financial statements due to fraud or mistake.
When preparing the financial statements, the management is responsible for assessing the Company’s ability ofcontinuous operation, disclosing the matters relating to continuous operation (if applicable) and applying theassumption of continuous operation, unless the management plans to liquidate the Company, terminate operationor has no other practicable choice.The governance is responsible for monitoring the financial reporting process of the CBC Company.VI. Auditor’s responsibility for audit of the financial statementsOur objectives are to obtain reasonable assurance about whether these financial statements as a whole are freefrom material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes ouropinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted inaccordance with auditing standards will always be found in the presence of a material misstatement.Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, theycould reasonably be expected to influence the economic decisions of users taken on the basis of these financialstatements.
As part of an audit in accordance with auditing standards, we exercise professional judgment and maintainprofessional skepticism throughout the audit. We also:
(1) Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error,design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient andappropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting fromfraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions,misrepresentations, or the override of internal control.
(2) Obtain an understanding of internal control relevant to the audit in order to design audit procedures that areappropriate in the circumstances.
(3) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates andrelated disclosures made by management.
(4) Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based onthe audit evidence obtained, whether a material uncertainty exists related to events or conditions that may castsignificant doubt on the Company’s ability to continue as a going concern. If we conclude that a materialuncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in these
financial statements or, if such disclosures are inadequate, we have to modify our opinion. Our conclusions arebased 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.
(5) Evaluate the overall presentation, structure and content of the financial statements, and whether the financialstatements represent the underlying transactions and events in a manner that achieves fair presentation.
(6) Obtain adequate and appropriate audit evidence in relation to the financial information of the entities orbusiness transactions of the Company, in order to issue audit opinion on the financial statement. We areresponsible for guiding, supervising and executing the audit for the Group, and we accept full responsibility forthe audit opinion.We communicate with those charged with governance regarding, among other matters, the planned scope andtiming of the audit and significant audit findings, including any significant deficiencies in internal control that weidentify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethicalrequirements regarding independence, and to communicate with them all relationships and other matters that mayreasonably be thought to bear on our independence, and related safeguards (if applicable).
From the matters communicated with those charged with governance, we determine those matters that were ofmost significance in the audit of the financial statements of the current period and are therefore the key auditmatters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosureabout the matter or when, in extremely rare circumstances, we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonably be expected tooutweigh the public interest benefits of such communication.
II. Financial statementUnit in note of financial statement refers to CNY: RMB (Yuan)
1. Consolidated Balance Sheet
Prepared by Shenzhen China Bicycle Company (Holdings)Co., Ltd.
December 31, 2023
In RMB
| Item | December 31,2023 | January 1,2023 |
| Current assets: | ||
| Monetary fund | 54,148,674.40 | 54,699,491.18 |
| Settlement provisions | ||
| Capital lent | ||
| Trading financial assets |
| Derivative financial assets | ||
| Note receivable | 1,102,000.00 | |
| Account receivable | 196,293,133.00 | 250,069,301.93 |
| Receivable financing | ||
| Accounts paid in advance | 3,821,181.16 | 4,286,935.15 |
| Insurance receivable | ||
| Reinsurance receivables | ||
| Contract reserve of reinsurance receivable | ||
| Other account receivable | 12,868,327.03 | 438,477.82 |
| Including: Interest receivable | ||
| Dividend receivable | ||
| Buying back the sale of financial assets | ||
| Inventory | 81,916,039.14 | 48,206,866.81 |
| Contractual assets | ||
| Assets held for sale | ||
| Non-current asset due within one year | ||
| Other current assets | 11,216,095.44 | 35,453,106.62 |
| Total current assets | 360,263,450.17 | 394,256,179.51 |
| Non-current assets: | ||
| Loans and payments on behalf | ||
| Debt investment | ||
| Other debt investment | ||
| Long-term account receivable | ||
| Long-term equity investment | ||
| Investment in other equity instrument | ||
| Other non-current financial assets | ||
| Investment real estate | ||
| Fixed assets | 2,288,610.10 | 2,304,402.38 |
| Construction in progress | ||
| Productive biological asset | ||
| Oil and gas asset | ||
| Right-of-use assets | 1,816,269.83 | 173,936.71 |
| Intangible assets | ||
| Expense on Research and Development | ||
| Goodwill | ||
| Long-term expenses to be apportioned | ||
| Deferred income tax asset | 4,909,164.22 | 118,969.33 |
| Other non-current assets | 400,000.00 | 400,000.00 |
| Total non-current assets | 9,414,044.15 | 2,997,308.42 |
| Total assets | 369,677,494.32 | 397,253,487.93 |
| Current liabilities: |
| Short-term loans | ||
| Loan from central bank | ||
| Capital borrowed | ||
| Trading financial liability | ||
| Derivative financial liability | ||
| Note payable | ||
| Account payable | 6,213,665.02 | 2,877,423.23 |
| Accounts received in advance | ||
| Contractual liability | 633,114.64 | 791,762.84 |
| Selling financial asset of repurchase | ||
| Absorbing deposit and interbank deposit | ||
| Security trading of agency | ||
| Security sales of agency | ||
| Wage payable | 1,149,151.81 | 769,992.42 |
| Taxes payable | 11,297,756.46 | 38,144,508.36 |
| Other account payable | 39,034,314.13 | 48,621,087.98 |
| Including: Interest payable | ||
| Dividend payable | ||
| Commission charge and commission payable | ||
| Reinsurance payable | ||
| Liability held for sale | ||
| Non-current liabilities due within one year | 847,403.05 | 210,892.38 |
| Other current liabilities | 82,304.90 | 102,929.16 |
| Total current liabilities | 59,257,710.01 | 91,518,596.37 |
| Non-current liabilities: | ||
| Insurance contract reserve | ||
| Long-term loans | ||
| Bonds payable | ||
| Including: Preferred stock | ||
| Perpetual bonds | ||
| Lease liability | 1,018,630.12 | |
| Long-term account payable | ||
| Long-term wages payable | ||
| Accrual liability | 887,342.00 | |
| Deferred income | ||
| Deferred income tax liabilities | ||
| Other non-current liabilities | ||
| Total non-current liabilities | 1,018,630.12 | 887,342.00 |
| Total liabilities | 60,276,340.13 | 92,405,938.37 |
| Owner’s equity: | ||
| Share capital | 689,184,933.00 | 689,184,933.00 |
| Other equity instrument |
| Including: Preferred stock | ||
| Perpetual bonds | ||
| Capital public reserve | 779,554,450.36 | 778,824,470.95 |
| Less: Inventory shares | ||
| Other comprehensive income | ||
| Reasonable reserve | ||
| Surplus public reserve | 32,673,227.01 | 32,673,227.01 |
| Provision of general risk | ||
| Retained profit | -1,192,651,364.21 | -1,210,553,312.45 |
| Total owner’ s equity attributable to parent company | 308,761,246.16 | 290,129,318.51 |
| Minority interests | 639,908.03 | 14,718,231.05 |
| Total owner’ s equity | 309,401,154.19 | 304,847,549.56 |
| Total liabilities and owner’ s equity | 369,677,494.32 | 397,253,487.93 |
Legal Representative: Li Hai Person in charge of Accounting Works: Sun Longlong Person in charge of AccountingInstitution: She Hanxing
2. Balance Sheet of Parent Company
In RMB
| Item | December 31,2023 | January 1,2023 |
| Current assets: | ||
| Monetary fund | 13,378,843.17 | 44,090,324.53 |
| Trading financial assets | ||
| Derivative financial assets | ||
| Note receivable | 400,000.00 | |
| Account receivable | 185,121,769.23 | 213,762,895.33 |
| Receivable financing | ||
| Accounts paid in advance | 10,066,139.77 | 39,465,026.86 |
| Other account receivable | 17,300,576.60 | 209,606.79 |
| Including: Interest receivable | ||
| Dividend receivable | ||
| Inventory | 58,463,627.32 | 42,640,812.21 |
| Contractual assets | ||
| Assets held for sale | ||
| Non-current asset due within one year | ||
| Other current assets | ||
| Total current assets | 284,330,956.09 | 340,568,665.72 |
| Non-current assets: | ||
| Debt investment | ||
| Other debt investment | ||
| Long-term account receivable | ||
| Long-term equity investment | 120,510,379.73 | 19,960,379.73 |
| Investment in other equity instrument | ||
| Other non-current financial assets | ||
| Investment real estate | ||
| Fixed assets | 2,052,548.31 | 2,209,564.35 |
| Construction in progress |
| Productive biological asset | ||
| Oil and gas asset | ||
| Right-of-use assets | 105,403.37 | |
| Intangible assets | ||
| Expense on Research and Development | ||
| Goodwill | ||
| Long-term expenses to be apportioned | ||
| Deferred income tax asset | 4,587,566.82 | |
| Other non-current assets | 400,000.00 | 400,000.00 |
| Total non-current assets | 127,550,494.86 | 22,675,347.45 |
| Total assets | 411,881,450.95 | 363,244,013.17 |
| Current liabilities: | ||
| Short-term loans | ||
| Trading financial liability | ||
| Derivative financial liability | ||
| Note payable | ||
| Account payable | 2,660,407.22 | 275,843.19 |
| Accounts received in advance | ||
| Contractual liability | ||
| Wage payable | 381,092.87 | 403,771.82 |
| Taxes payable | 10,988,473.35 | 35,797,995.48 |
| Other account payable | 86,300,406.58 | 40,465,510.28 |
| Including: Interest payable | ||
| Dividend payable | ||
| Liability held for sale | ||
| Non-current liabilities due within one year | 121,977.23 | |
| Other current liabilities | ||
| Total current liabilities | 100,330,380.02 | 77,065,098.00 |
| Non-current liabilities: | ||
| Long-term loans | ||
| Bonds payable | ||
| Including: Preferred stock | ||
| Perpetual bonds | ||
| Lease liability | ||
| Long-term account payable | ||
| Long-term wages payable | ||
| Accrual liability | 878,000.00 | |
| Deferred income | ||
| Deferred income tax liabilities | ||
| Other non-current liabilities | ||
| Total non-current liabilities | 878,000.00 |
| Total liabilities | 100,330,380.02 | 77,943,098.00 |
| Owner’s equity: | ||
| Share capital | 689,184,933.00 | 689,184,933.00 |
| Other equity instrument | ||
| Including: Preferred stock | ||
| Perpetual bonds | ||
| Capital public reserve | 790,922,522.71 | 778,824,470.95 |
| Less: Inventory shares | ||
| Other comprehensive income | ||
| Reasonable reserve | ||
| Surplus public reserve | 32,673,227.01 | 32,673,227.01 |
| Retained profit | -1,201,229,611.79 | -1,215,381,715.79 |
| Total owner’ s equity | 311,551,070.93 | 285,300,915.17 |
| Total liabilities and owner’ s equity | 411,881,450.95 | 363,244,013.17 |
3. Consolidated Profit Statement
In RMB
| Item | 2023 | 2022 |
| I. Total operation revenue | 568,481,907.92 | 444,762,238.25 |
| Including: Operation revenue | 568,481,907.92 | 444,762,238.25 |
| Interest income | ||
| Insurance gained | ||
| Commission charge and commission income | ||
| II. Total operation cost | 546,646,169.07 | 434,584,382.03 |
| Including: Operation cost | 531,606,161.37 | 416,884,753.17 |
| Interest expense | ||
| Commission charge and commission expense | ||
| Cash surrender value | ||
| Net amount of expense of compensation | ||
| Net amount of withdrawal of insurance contract reserve | ||
| Bonus expense of guarantee slip | ||
| Reinsurance expense | ||
| Tax and surcharge | 1,034,078.59 | 3,757,974.70 |
| Sales expenses | 5,988,294.90 | 5,688,257.68 |
| Administrative expenses | 6,762,314.00 | 7,525,176.16 |
| R&D expenses | 1,270,512.42 | 924,567.70 |
| Financial expenses | -15,192.21 | -196,347.38 |
| Including: Interest expenses | 55,573.42 | 33,239.03 |
| Interest income | 93,865.93 | 272,353.25 |
| Add: Other income | 122,592.35 | 146,351.13 |
| Investment income (Loss is listed with “-”) | ||
| Including: Investment income on affiliated company and joint venture | ||
| The termination of income recognition for |
| financial assets measured by amortized cost | ||
| Exchange income (Loss is listed with “-”) | ||
| Net exposure hedging income (Loss is listed with “-”) | ||
| Income from change of fair value (Loss is listed with “-”) | ||
| Loss of credit impairment (Loss is listed with “-”) | -2,735,858.31 | -15,516,772.44 |
| Impairment loss on assets(Loss is listed with “-”) | -316,923.59 | -840,361.84 |
| Income from assets disposal (Loss is listed with “-”) | -16,957.53 | |
| III. Operation profit (Loss is listed with “-”) | 18,905,549.30 | -6,049,884.46 |
| Add: Non-operating income | 5,925,720.13 | 4,081,450.75 |
| Less: Non-operating expense | 6,238,056.41 | 4,744,024.13 |
| IV. Total profit (Loss is listed with “-”) | 18,593,213.02 | -6,712,457.84 |
| Less: Income tax expense | 587,660.15 | 1,269,885.38 |
| V. Net profit (Net loss is listed with “-”) | 18,005,552.87 | -7,982,343.22 |
| (i) Classify by business continuity | ||
| 1.Continuous operating net profit (net loss listed with ‘-”) | 18,005,552.87 | -7,982,343.22 |
| 2.Termination of net profit (net loss listed with ‘-”) | ||
| (ii) Classify by ownership | ||
| 1.Net profit attributable to shareholders of parent company | 17,901,948.24 | -7,616,378.75 |
| 2.Minority shareholders’ gains and losses | 103,604.63 | -365,964.47 |
| VI. Net other comprehensive income after taxation | ||
| Net other comprehensive income attributable to owners of parent company after taxation | ||
| (i) Other comprehensive income items which will not be reclassified subsequently to profit of loss | ||
| 1.Changes of the defined benefit plans that re-measured | ||
| 2.Other comprehensive income under equity method that cannot be transfer to gain/loss | ||
| 3.Change of fair value of investment in other equity instrument | ||
| 4.Fair value change of enterprise's credit risk | ||
| 5. Other | ||
| (ii) Other comprehensive income items which will be reclassified subsequently to profit or loss | ||
| 1.Other comprehensive income under equity method that can transfer to gain/loss | ||
| 2.Change of fair value of other debt investment |
| 3.Amount of financial assets re-classify to other comprehensive income | ||
| 4.Credit impairment provision for other debt investment | ||
| 5.Cash flow hedging reserve | ||
| 6.Translation differences arising on translation of foreign currency financial statements | ||
| 7.Other | ||
| Net other comprehensive income attributable to minority shareholders after taxation | ||
| VII. Total comprehensive income | 18,005,552.87 | -7,982,343.22 |
| Total comprehensive income attributable to owners of parent Company | 17,901,948.24 | -7,616,378.75 |
| Total comprehensive income attributable to minority shareholders | 103,604.63 | -365,964.47 |
| VIII. Earnings per share: | ||
| (i)Basic EPS | 0.03 | -0.01 |
| (ii)Diluted EPS | 0.03 | -0.01 |
As for the enterprise combined under the same control, net profit of 0 Yuan achieved by the merged party beforecombination while 0 Yuan achieved last period.
Legal Representative: Li Hai Person in charge of Accounting Works: Sun Longlong Person in charge ofAccounting Institution: She Hanxing
4. Profit Statement of Parent Company
In RMB
| Item | 2023 | 2022 |
| I. Operation revenue | 234,721,203.71 | 267,241,929.51 |
| Less: Operation cost | 214,007,010.45 | 253,488,605.37 |
| Tax and surcharge | 889,588.67 | 3,606,282.77 |
| Sales expenses | 110,531.34 | 489,404.45 |
| Administrative expenses | 2,811,080.04 | 2,191,110.35 |
| R&D expenses | 519,368.85 | 396,209.62 |
| Financial expenses | -39,436.54 | -40,271.90 |
| Including: Interest expenses | -7,266.83 | 15,022.20 |
| Interest income | 40,936.29 | 60,656.53 |
| Add: Other income | 122,085.77 | 126,559.52 |
| Investment income (Loss is listed with “-”) | ||
| Including: Investment income on affiliated company and joint venture | ||
| The termination of income recognition for financial assets measured by amortized cost(Loss is listed with “-”) | ||
| Net exposure hedging income (Loss is listed with “-”) | ||
| Income from change of fair value (Loss is listed with “-”) |
| Loss of credit impairment (Loss is listed with “-”) | -1,467,660.13 | -11,110,711.22 |
| Impairment loss on assets(Loss is listed with “-”) | -20,908.38 | -729,605.75 |
| Income from assets disposal (Loss is listed with “-”) | -16,957.53 | |
| II. Operation profit(Loss is listed with “-”) | 15,056,578.16 | -4,620,126.13 |
| Add: Non-operating income | 4,656,019.17 | 4,078,353.41 |
| Less: Non-operating expense | 6,227,581.37 | 4,715,083.72 |
| III. Total profit (Total losses are listed with “-”) | 13,485,015.96 | -5,256,856.44 |
| Less: Income tax expense | -667,088.04 | 1,117,279.57 |
| IV. Net profit (Net loss is listed with “-”) | 14,152,104.00 | -6,374,136.01 |
| (i)Continuous operating net profit (net loss listed with ‘-”) | 14,152,104.00 | -6,374,136.01 |
| (ii)Termination of net profit (net loss listed with ‘-”) | ||
| V. Net other comprehensive income after taxation | ||
| (i) Other comprehensive income items which will not be reclassified subsequently to profit of loss | ||
| 1.Changes of the defined benefit plans that re-measured | ||
| 2.Other comprehensive income under equity method that cannot be transfer to gain/loss | ||
| 3.Change of fair value of investment in other equity instrument | ||
| 4.Fair value change of enterprise's credit risk | ||
| 5. Other | ||
| (ii) Other comprehensive income items which will be reclassified subsequently to profit or loss | ||
| 1.Other comprehensive income under equity method that can transfer to gain/loss | ||
| 2.Change of fair value of other debt investment | ||
| 3.Amount of financial assets re-classify to other comprehensive income | ||
| 4.Credit impairment provision for other debt investment | ||
| 5.Cash flow hedging reserve | ||
| 6.Translation differences arising on translation of foreign currency financial statements | ||
| 7.Other | ||
| VI. Total comprehensive income | 14,152,104.00 | -6,374,136.01 |
| VII. Earnings per share: | ||
| (i)Basic EPS | ||
| (ii)Diluted EPS |
5. Consolidated Cash Flow Statement
In RMB
| Item | 2023 | 2022 |
| I. Cash flows arising from operating activities: | ||
| Cash received from selling commodities and providing labor services | 693,290,103.64 | 280,153,474.61 |
| Net increase of customer deposit and interbank deposit | ||
| Net increase of loan from central bank | ||
| Net increase of capital borrowed from other financial institution | ||
| Cash received from original insurance contract fee | ||
| Net cash received from reinsurance business | ||
| Net increase of insured savings and investment | ||
| Cash received from interest, commission charge and commission | ||
| Net increase of capital borrowed | ||
| Net increase of capital from repurchase business | ||
| Net cash received by agents in sale and purchase of securities | ||
| Write-back of tax received | 211,285.93 | |
| Other cash received concerning operating activities | 7,045,188.89 | 9,804,457.72 |
| Subtotal of cash in-flow arising from operation activity | 700,335,292.53 | 290,169,218.26 |
| Cash paid for purchasing commodities and receiving labor service | 632,792,810.92 | 522,417,130.69 |
| Net increase of customer loans and advances | ||
| Net increase of deposits in central bank and interbank | ||
| Cash paid for original insurance contract compensation | ||
| Net increase of capital lent | ||
| Cash paid for interest, handling charge and commission | ||
| Cash paid for bonus of guarantee slip | ||
| Cash paid to/for staff | 7,436,185.68 | 5,682,412.88 |
| Taxes paid | 10,892,486.15 | 1,289,781.65 |
| Other cash paid concerning operating activities | 19,240,979.16 | 22,198,959.07 |
| Subtotal of cash out-flow arising from operation activity | 670,362,461.91 | 551,588,284.29 |
| Net cash flow arising from operating activities | 29,972,830.62 | -261,419,066.03 |
| II. Cash flows arising from investing activities: |
| Cash received from recovering investment | ||
| Cash received from investment income | ||
| Net cash received from disposal of fixed, intangible and other long-term assets | 50,000.00 | |
| Net cash received from disposal of subsidiaries and other units | ||
| Other cash received concerning investing activities | ||
| Subtotal of cash in-flow arising from investment activity | 50,000.00 | |
| Cash paid for purchasing fixed, intangible and other long-term assets | 191,819.97 | 40,164.10 |
| Cash paid for investment | ||
| Net increase of mortgaged loans | ||
| Net cash received from subsidiaries and other units obtained | ||
| Other cash paid concerning investing activities | ||
| Subtotal of cash out-flow arising from investment activity | 191,819.97 | 40,164.10 |
| Net cash flow arising from investment activities | -191,819.97 | 9,835.90 |
| III. Cash flows arising from financing activities: | ||
| Cash received from absorbing investment | 290,292,780.18 | |
| Including: Cash received from absorbing minority shareholders’ investment by subsidiaries | ||
| Cash received from loans | ||
| Other cash received concerning financing activities | 9,000,000.00 | |
| Subtotal of cash in-flow arising from financing activity | 299,292,780.18 | |
| Cash paid for settling debts | ||
| Cash paid for dividend and profit distributing or interest paying | ||
| Including: Dividend and profit of minority shareholder paid by subsidiaries | ||
| Other cash paid concerning financing activities | 26,555,205.60 | 20,207,638.62 |
| Subtotal of cash out-flow arising from financing activity | 26,555,205.60 | 20,207,638.62 |
| Net cash flow arising from financing activities | -26,555,205.60 | 279,085,141.56 |
| IV. Influence on cash and cash equivalents due to fluctuation in exchange rate | ||
| V. Net increased amount of cash and cash equivalent | 3,225,805.05 | 17,675,911.43 |
| Add: Balance of cash and cash equivalents at the period -begin | 50,922,869.35 | 33,246,957.92 |
| VI. Balance of cash and cash equivalents at the period -end | 54,148,674.40 | 50,922,869.35 |
6. Cash Flow Statement of Parent Company
In RMB
| Item | 2023 | 2022 |
| I. Cash flows arising from operating activities: | ||
| Cash received from selling commodities and providing labor services | 292,088,998.41 | 99,421,799.26 |
| Write-back of tax received | ||
| Other cash received concerning operating activities | 248,405,820.05 | 26,085,946.66 |
| Subtotal of cash in-flow arising from operation activity | 540,494,818.46 | 125,507,745.92 |
| Cash paid for purchasing commodities and receiving labor service | 253,319,398.18 | 336,871,285.17 |
| Cash paid to/for staff | 2,277,577.85 | 1,220,883.46 |
| Taxes paid | 7,118,997.86 | 460,792.02 |
| Other cash paid concerning operating activities | 204,138,993.70 | 34,421,627.82 |
| Subtotal of cash out-flow arising from operation activity | 466,854,967.59 | 372,974,588.47 |
| Net cash flow arising from operating activities | 73,639,850.87 | -247,466,842.55 |
| II. Cash flows arising from investing activities: | ||
| Cash received from recovering investment | ||
| Cash received from investment income | ||
| Net cash received from disposal of fixed, intangible and other long-term assets | 50,000.00 | |
| Net cash received from disposal of subsidiaries and other units | ||
| Other cash received concerning investing activities | ||
| Subtotal of cash in-flow arising from investment activity | 50,000.00 | |
| Cash paid for purchasing fixed, intangible and other long-term assets | ||
| Cash paid for investment | 100,550,000.00 | |
| Net cash received from subsidiaries and other units obtained | ||
| Other cash paid concerning investing activities | ||
| Subtotal of cash out-flow arising from investment activity | 100,550,000.00 | |
| Net cash flow arising from investment activities | -100,550,000.00 | 50,000.00 |
| III. Cash flows arising from financing activities: | ||
| Cash received from absorbing investment | 290,292,780.18 | |
| Cash received from loans | ||
| Other cash received concerning financing activities | 9,000,000.00 | |
| Subtotal of cash in-flow arising from financing activity | 299,292,780.18 |
| Cash paid for settling debts | ||
| Cash paid for dividend and profit distributing or interest paying | ||
| Other cash paid concerning financing activities | 114,710.40 | 19,085,278.53 |
| Subtotal of cash out-flow arising from financing activity | 114,710.40 | 19,085,278.53 |
| Net cash flow arising from financing activities | -114,710.40 | 280,207,501.65 |
| IV. Influence on cash and cash equivalents due to fluctuation in exchange rate | ||
| V. Net increased amount of cash and cash equivalent | -27,024,859.53 | 32,790,659.10 |
| Add: Balance of cash and cash equivalents at the period -begin | 40,403,702.70 | 7,613,043.60 |
| VI. Balance of cash and cash equivalents at the period -end | 13,378,843.17 | 40,403,702.70 |
7. Statement of Changes in Owners’ Equity (Consolidated)
Current amount
In RMB
| Item | 2023 | ||||||||||||||
| Owners’ equity attributable to the parent Company | Minority interests | Total owner’ s equity | |||||||||||||
| Share capital | Other equity instrument | Capital public reserve | Less: Inventory shares | Other comprehensive income | Reasonable reserve | Surplus public reserve | Provision of general risk | Retained profit | Other | Subtotal | |||||
| Preferred stock | Perpetual bonds | Other | |||||||||||||
| I. The ending balance of the previous year | 689,184,933.00 | 778,824,470.95 | 32,673,227.01 | -1,210,553,312.45 | 290,129,318.51 | 14,718,231.05 | 304,847,549.56 | ||||||||
| Add: Changes of accounting policy | |||||||||||||||
| 前Error correction of the last period | |||||||||||||||
| oOther | |||||||||||||||
| II. The | 689, | 778, | 32,6 | - | 290, | 14,7 | 304, | ||||||||
| beginning balance of the current year | 184,933.00 | 824,470.95 | 73,227.01 | 1,210,553,312.45 | 129,318.51 | 18,231.05 | 847,549.56 | ||||||||
| III. Increase/ Decrease in the period (Decrease is listed with “-”) | 729,979.41 | 17,901,948.24 | 18,631,927.65 | -14,078,323.02 | 4,553,604.63 | ||||||||||
| (i) Total comprehensive income | 17,901,948.24 | 17,901,948.24 | 103,604.63 | 18,005,552.87 | |||||||||||
| (ii) Owners’ devoted and decreased capital | 729,979.41 | 729,979.41 | -14,181,927.65 | -13,451,948.24 | |||||||||||
| 1．Common shares invested by owners | |||||||||||||||
| 2．Capital invested by holders of other equity instruments | |||||||||||||||
| 3． Amount reckoned into owners equity with share-based payment | |||||||||||||||
| 4．Other | 729,979.41 | 729,979.41 | -14,181,9 | -13,451,9 |
| 27.65 | 48.24 | ||||||||||||||
| (iii) Profit distribution | |||||||||||||||
| 1．Withdrawal of surplus public reserve | |||||||||||||||
| 2．Withdrawal of general risk provisions | |||||||||||||||
| 3．Distribution for owners (or shareholders) | |||||||||||||||
| 4．Other | |||||||||||||||
| (iv)Carrying forward internal owners’ equity | |||||||||||||||
| 1．Transfer of capital reserves to capital (or share capital) | |||||||||||||||
| 2．Transfer of surplus public reserves to capital (or share capital) | |||||||||||||||
| 3．Remedying loss with |
| surplus public reserve | |||||||||||||||
| 4．Carry-over retained earnings from the defined benefit plans | |||||||||||||||
| 5．Carry-over retained earnings from other comprehensive income | |||||||||||||||
| 6．Other | |||||||||||||||
| (v)Reasonable reserve | |||||||||||||||
| 1．Withdrawal in the current period | |||||||||||||||
| 2．Usage in the current period | |||||||||||||||
| (vi) Other | |||||||||||||||
| IV. Balance at the end of the period | 689,184,933.00 | 779,554,450.36 | 32,673,227.01 | -1,192,651,364.21 | 308,761,246.16 | 639,908.03 | 309,401,154.19 |
Amount of the previous period
In RMB
| Item | 2022 | ||||||||||||||
| Owners’ equity attributable to the parent Company | Minority interests | Total owner’ s equity | |||||||||||||
| Share capital | Other equity instrument | Capital public reserve | Less: Inventory shares | Other comprehensive inco | Reasonable reserve | Surplus public reserve | Provision of general risk | Retained profit | Other | Subtotal | |||||
| Preferred stock | Perpetual bonds | Other | |||||||||||||
| me | |||||||||||||||
| I. The ending balance of the previous year | 551,347,947.00 | 627,834,297.85 | 32,673,227.01 | -1,202,936,933.70 | 8,918,538.16 | 15,084,195.52 | 24,002,733.68 | ||||||||
| Add: Changes of accounting policy | |||||||||||||||
| 前Error correction of the last period | |||||||||||||||
| oOther | |||||||||||||||
| II. The beginning balance of the current year | 551,347,947.00 | 627,834,297.85 | 32,673,227.01 | -1,202,936,933.70 | 8,918,538.16 | 15,084,195.52 | 24,002,733.68 | ||||||||
| III. Increase/ Decrease in the period (Decrease | 137,836,986.00 | 150,990,173.10 | -7,616,378.75 | 281,210,780.35 | -365,964.47 | 280,844,815.88 |
| is listed with “-”) | |||||||||||||||
| (i) Total comprehensive income | -7,616,378.75 | -7,616,378.75 | -365,964.47 | -7,982,343.22 | |||||||||||
| (ii) Owners’ devoted and decreased capital | 137,836,986.00 | 150,990,173.10 | 288,827,159.10 | 288,827,159.10 | |||||||||||
| 1．Common shares invested by owners | 137,836,986.00 | 150,990,173.10 | 288,827,159.10 | 288,827,159.10 | |||||||||||
| 2．Capital invested by holders of other equity instruments | |||||||||||||||
| 3． Amount reckoned into own |
| ers equity with share-based payment | |||||||||||||||
| 4．Other | |||||||||||||||
| (iii) Profit distribution | |||||||||||||||
| 1．Withdrawal of surplus public reserve | |||||||||||||||
| 2．Withdrawal of general risk provisions | |||||||||||||||
| 3．Distribution for owners (or shareholders) | |||||||||||||||
| 4．Other | |||||||||||||||
| (iv)Carrying |
| forward internal owners’ equity | |||||||||||||||
| 1．Transfer of capital reserves to capital (or share capital) | |||||||||||||||
| 2．Transfer of surplus public reserves to capital (or share capital) | |||||||||||||||
| 3．Remedying loss with surplus public reserve | |||||||||||||||
| 4．Carry-over retained earnings |
| from the defined benefit plans | |||||||||||||||
| 5．Carry-over retained earnings from other comprehensive income | |||||||||||||||
| 6．Other | |||||||||||||||
| (v)Reasonable reserve | |||||||||||||||
| 1．Withdrawal in the current period | |||||||||||||||
| 2．Usage in the current period | |||||||||||||||
| (vi) Other | |||||||||||||||
| IV. Balance | 689,184,933. | 778,824,470. | 32,673,227.0 | -1,210,55 | 290,129,318. | 14,718,231.0 | 304,847,549. |
| at the end of the period | 00 | 95 | 1 | 3,312.45 | 51 | 5 | 56 |
8. Statement of Changes in Owners’ Equity (Parent Company)
Current amount
In RMB
| Item | 2023 | |||||||||||
| Share capital | Other equity instrument | Capital public reserve | Less: Inventory shares | Other comprehensive income | Reasonable reserve | Surplus public reserve | Retained profit | Other | Total owner’ s equity | |||
| Preferred stock | Perpetual bonds | Other | ||||||||||
| I. The ending balance of the previous year | 689,184,933.00 | 778,824,470.95 | 32,673,227.01 | -1,215,381,715.79 | 285,300,915.17 | |||||||
| Add: Changes of accounting policy | ||||||||||||
| 前Error correction of the last period | ||||||||||||
| 其Other | ||||||||||||
| II. The beginning balance of the current year | 689,184,933.00 | 778,824,470.95 | 32,673,227.01 | -1,215,381,715.79 | 285,300,915.17 | |||||||
| III. Increase/ Decrease in the | 12,098,051.76 | 14,152,104.00 | 26,250,155.76 | |||||||||
| period (Decrease is listed with “-”) | ||||||||||||
| (i) Total comprehensive income | 14,152,104.00 | 14,152,104.00 | ||||||||||
| (ii) Owners’ devoted and decreased capital | 12,098,051.76 | 12,098,051.76 | ||||||||||
| 1．Common shares invested by owners | ||||||||||||
| 2．Capital invested by holders of other equity instruments | ||||||||||||
| 3． Amount reckoned into owners equity with share-based payment | ||||||||||||
| 4．Other | 12,098,051.76 | 12,098,051.76 | ||||||||||
| (iii) Profit distribution |
| 1．Withdrawal of surplus public reserve | ||||||||||||
| 2．Distribution for owners (or shareholders) | ||||||||||||
| 3．Other | ||||||||||||
| (iv)Carrying forward internal owners’ equity | ||||||||||||
| 1．Transfer of capital reserves to capital (or share capital) | ||||||||||||
| 2．Transfer of surplus public reserves to capital (or share capital) | ||||||||||||
| 3．Remedying loss with surplus public reserve | ||||||||||||
| 4．Ca |
| rry-over retained earnings from the defined benefit plans | ||||||||||||
| 5．Carry-over retained earnings from other comprehensive income | ||||||||||||
| 6．Other | ||||||||||||
| (v)Reasonable reserve | ||||||||||||
| 1．Withdrawal in the current period | ||||||||||||
| 2．Usage in the current period | ||||||||||||
| (vi) Other | ||||||||||||
| IV. Balance at the end of the period | 689,184,933.00 | 790,922,522.71 | 32,673,227.01 | -1,201,229,611.79 | 311,551,070.93 |
Amount of the previous period
In RMB
| Item | 2022 | |||||||||||
| Share capital | Other equity instrument | Capital public reserve | Less: Inventory shares | Other comprehensive income | Reasonable reserve | Surplus public reserve | Retained profit | Other | Total owner’ s equity | |||
| Preferred stock | Perpetual bonds | Other | ||||||||||
| I. The ending balance of the previous year | 551,347,947.00 | 627,834,297.85 | 32,673,227.01 | -1,209,007,579.78 | 2,847,892.08 | |||||||
| Add: Changes of accounting policy | ||||||||||||
| 前Error correction of the last period | ||||||||||||
| 其Other | ||||||||||||
| II. The beginning balance of the current year | 551,347,947.00 | 627,834,297.85 | 32,673,227.01 | -1,209,007,579.78 | 2,847,892.08 | |||||||
| III. Increase/ Decrease in the period (Decrease is listed with “-”) | 137,836,986.00 | 150,990,173.10 | -6,374,136.01 | 282,453,023.09 | ||||||||
| (i) Total comprehensive incom | -6,374,136.01 | -6,374,136.01 | ||||||||||
| e | ||||||||||||
| (ii) Owners’ devoted and decreased capital | 137,836,986.00 | 150,990,173.10 | 288,827,159.10 | |||||||||
| 1．Common shares invested by owners | 137,836,986.00 | 150,990,173.10 | 288,827,159.10 | |||||||||
| 2．Capital invested by holders of other equity instruments | ||||||||||||
| 3． Amount reckoned into owners equity with share-based payment | ||||||||||||
| 4．Other | ||||||||||||
| (iii) Profit distribution | ||||||||||||
| 1．Withdrawal of surplus public reserve | ||||||||||||
| 2．Distribution for owners (or shareholders) |
| 3．Other | ||||||||||||
| (iv)Carrying forward internal owners’ equity | ||||||||||||
| 1．Transfer of capital reserves to capital (or share capital) | ||||||||||||
| 2．Transfer of surplus public reserves to capital (or share capital) | ||||||||||||
| 3．Remedying loss with surplus public reserve | ||||||||||||
| 4．Carry-over retained earnings from the defined benefit plans | ||||||||||||
| 5．Ca |
| rry-over retained earnings from other comprehensive income | ||||||||||||
| 6．Other | ||||||||||||
| (v)Reasonable reserve | ||||||||||||
| 1．Withdrawal in the current period | ||||||||||||
| 2．Usage in the current period | ||||||||||||
| (vi) Other | ||||||||||||
| IV. Balance at the end of the period | 689,184,933.00 | 778,824,470.95 | 32,673,227.01 | -1,215,381,715.79 | 285,300,915.17 |
III. Basic information
1. Company Profile
According to the Approval Document SFBF (1991) No. 888 issued by the People’s Government of Shenzhen,Shenzhen China Bicycle Company (Holdings) Co., Ltd. (hereinafter referred to as the CBC) was reincorporated asthe company limited by shares in November 1991. On 28 December 1991, upon the Approval DocumentSRYFZ(1991) No. 119 issued by Shenzhen Special Economic Zone Branch of the People’s Bank of China, theCompany got listed on Shenzhen Stock Exchange. Registered of the Company amounted as 689,184,933.00 Yuan.Legal representative: Wang Shenghong
Location: No. 3008, Buxin Road, Luohu District, ShenzhenOffice address: 8/F Shuibei Jinzuo Building, No.89 Beili North Road, Cuizhu Street, Luohu District, ShenzhenCertificate for Uniform Social Credit Code: 914403006188304524。
2. Business nature and main operation activities
Main business activities: Research & development of the bicycles, electric bicycles, electric motorcycles,motorcycles, electric tricycles, electric four-wheeler, children's bicycles, exercise bikes, sports equipment,mechanical products, toys, electric toys, electronic products, new energy equipment and storage equipment(lithium batteries, batteries, etc.), household appliances and spare parts, and electronic components; wholesale,retail, import and export and related supporting business of above-mentioned products (excluding commoditiessubject to state trade management, handling the application according to the relevant national regulations forcommodities involving quotas, license management and other special provisions and management,); fine chemicalproducts (excluding dangerous goods), wholesale and retail of carbon fiber composite materials; technologydevelopment of computer software, transfer of self-developed technological achievements, and providing relevanttechnical information consultation; own property leasing; property management. (The above projects do notinvolve special administrative measures for the implementation access of national regulations, and those involvingrestricted projects and pre-existing administrative licenses must obtain the pre-existing administrative licensingdocuments before operation.) Purchase and sale of gold products, platinum jewelry, palladium jewelry, K-goldjewelry, silver jewelry, inlaid jewelry, jewelry, jade ware, gem-and-jade products, clocks and watches, preciousmetal materials, diamonds, jadeite, crafts (except ivory and its products), calligraphy and painting, collection(except for antiques, cultural relics, and items prohibited by national laws and administrative regulations).
Main products or services currently offered are: Gold jewelry, EMMELLE bicycles and electrical bicycles,lithium battery material.
3.Actual controller of the Company
Actual controller of the Company is Wang Shenghong, The controlling shareholder is Wansheng IndustrialHolding (Shenzhen) Co., Ltd.,who held or controlled 20% shares of the Company.
4. Release of the financial report
The Financial Report was approved to report at the 11
th Session of 11
thBOD of CBC on April 19, 2024.IV. Compilation Basis of Financial Statement
1. Compilation Basis
On the basis of going concern, the Company recognizes and measures according to the actual transactionsand events, the Accounting Standards for Business Enterprises-Basic Standards and other specific accountingstandards, application guidelines, standard interpretation and other relevant provisions (hereinafter referred to asthe Accounting Standards for Business Enterprises), and on this basis, it compiles the financial statements incombination with the provisions of the No.15 Rules on Information Disclosure and Compilation of CompaniesOffering Securities to the Public - General Provisions on Financial Reports (revised in 2023) issued by ChinaSecurities Regulatory Commission.
2. Going concern
The Company has the ability to continue to operate for at least 12 months from the end of this reporting period,and there is no major issue affecting its ability to continue to operate.V. Main accounting policy and Accounting EstimateTips for specific accounting policy and estimate:
Nil
1. Declaration on compliance with accounting standards for business enterprise
The financial statements prepared by the Company meet the requirements of the Accounting Standards forBusiness Enterprises, and truly and completely reflect the Company's financial status, operating results, changesin owners' equity and cash flow and other relevant information.
2. Accounting period
Calendar year is the accounting period for the CBC, which is starting from 1 January to 31 December.
3. Business cycles
The Company takes 12 months as a business cycle.
4. Book-keeping currency
The CBC takes RMB as the standard currency for bookkeeping.
5.Determination method and selection basis of importance standard
?Applicable □Not applicable
| Item | Criterion of importance |
| Material receivables with bad debt provision accrued individually | Commercial acceptance bills receivable, accounts receivable and other receivables with a single amount exceeding RMB 5 million (inclusive) |
| Material amount recovered or reversed from bad debt provision of receivables in the current period | The single amount exceeds RMB 5 million (inclusive) |
| Write-off of Important material receivables in the current period | The single amount exceeds RMB 5 million (inclusive) |
| Material prepayments with an age of more than one year | The single amount exceeds RMB 5 million (inclusive) |
| Material accounts payable with an age of over 1 year | The single amount exceeds RMB 5 million (inclusive) |
| Material contractual liabilities with an age of more than 1 year | The single amount exceeds RMB 5 million (inclusive) |
| Material other payables with an age of more than 1 year | The single amount exceeds RMB 5 million (inclusive) |
| Material construction in progress | Construction in progress with a single amount exceeding RMB 5 million (inclusive) |
| Material commitments | Commitments involving an amount of more than 10% of the total profit and more than RMB 5 million (inclusive) |
| Material contingencies | Contingencies involving an amount of more than 10% of the total profit and more than RMB 5 million (inclusive) |
| Material matters after the balance sheet date | Matters after the balance sheet date involving an amount exceeding 10% of the total profit and exceeding RMB 5 million (inclusive) |
6. Accounting treatment for business combinations under the same control and those not under the samecontrol
1. Business merger under the same control: The assets and liabilities acquired by the Company in businessmerger are measured according to the book value of the assets and liabilities of the merged party (including thegoodwill formed by the acquisition of the merged party by the ultimate controlling party) in the consolidatedfinancial statements of the ultimate controlling party on the date of merger. For the difference between the bookvalue of the net assets obtained in the merger and the book value of the merger consideration paid (or the totalface value of the issued shares), adjust the capital premium or share capital premium in the capital reserve. Ifthe capital premium or share capital premium in the capital reserve is insufficient to offset, adjust the retainedincome.
2. Business merger not under the same control: The assets paid, liabilities incurred or assumed by theCompany as the consideration for business merger are measured at fair value on the date of purchase, and thedifference between fair value and book value is included in the current profits and losses. The Companyrecognizes the difference between the merger cost and the fair value share of the net identifiable assets of theacquiree obtained in the merger as goodwill; For the difference between the merger cost and the fair value shareof the net identifiable assets of the acquiree (which is larger than the merger cost), it reviews the fair values ofthe assets and liabilities obtained in the merger, the non-cash assets as the merger consideration or the equitysecurities issued, and the review results show that the determination of the fair values of the determinedidentifiable assets and liabilities is appropriate. The difference between the business merger cost and the fairvalue share of the net identifiable assets of the acquiree (which is larger than the business merger cost) isincluded in the non-operating income in the current merger period.
The business merger not under the same control is realized step by step through multiple transactions, andthe merger cost is the sum of the consideration paid on the date of purchase and the fair value of the equity ofthe acquiree held before the date of purchase; The equity of the purchased party held before the date of purchaseshall be re-measured according to the fair value on the date of purchase, and the difference between the fairvalue and its book value shall be included in the current investment income. Other comprehensive income of the
long-term equity investment of the acquiree held before the date of purchase under the accounting by equitymethod shall be subject to accounting treatment on the same basis as the direct disposal of relevant assets orliabilities by the investee. Changes in other shareholders' equity except net profits and losses, othercomprehensive income and profit distribution shall be converted into current profits and losses on the date ofpurchase. For other equity instrument investments of the acquiree held before the date of purchase, the changesin fair value of the equity instrument investments accumulated in other comprehensive income before the dateof purchase are transferred to retained profits and losses.
3. Disposal of related expenses in business merger: Intermediary expenses such as audit, legal services,evaluation and consultation and other related management expenses incurred for business merger are includedin current profits and losses when incurred; The transaction costs of equity securities or debt securities issued asthe merger consideration are included in the initial recognition amount of equity securities or debt securities.
7. Criteria for control and preparation method of consolidated financial statements
1. Criteria for control and preparation scope of consolidated statements
Control means that the investor has the power over the investee, enjoys variable returns by participating inthe related activities of the investee, and has the ability to influence the amount of returns by using the powerover the investee. As for whether to control the investee, the Company's criterion factors include:
(1) Have the power over the investee and the ability to lead the related activities of the investee;
(2) Be entitled to variable returns to the investee;
(3) Have the ability to use the power over the investee to influence its return amount.
Unless there is conclusive evidence that the Company cannot lead the related activities of the investee, theCompany has the power over the investee if:
(1) It holds more than half of the voting rights of the investee;
(2) It holds half or less of the voting rights of the investee, but controls more than half of the voting rightsthrough agreements with other voting rights holders.
If the Company holds half or less of the voting rights of the investee, but after comprehensiveconsideration of the following facts and circumstances, it is judged that the voting rights held are sufficient tolead the relevant activities of the investee, it is deemed that the Company has power over the investee:
(1) The size of the voting rights held relative to the voting rights held by other investors, and the degree ofdispersion of the voting rights held by other investors;
(2) The potential voting rights of the investee held by other investors, such as convertible corporate bondsand executable warrants;
(3) Other contractual rights;
(4) Other relevant facts and circumstances such as the past voting rights of the investee.
The Company evaluates the variability of returns based on the nature of contractual arrangements ratherthan the legal form of returns.
If the Company exercises the decision-making power as the main responsible person, or if other partieshave the decision-making power and other parties exercise the decision-making power as the agents of theCompany, it shows that the Company controls the investee.
Once the changes in relevant facts and circumstances lead to changes in the relevant factors involved inthe definition of control, the Company will re-evaluate.
The scope of consolidation of the consolidated financial statements is determined on the basis of control,including not only subsidiaries determined by voting rights (or similar rights) themselves or in combinationwith other arrangements, but also structured entities determined by one or more contractual arrangements.
2. Merger procedure
The consolidated financial statements are based on the financial statements of the Company and itssubsidiaries, and are prepared according to other relevant information.
The Company unifies the accounting policies and accounting periods adopted by its subsidiaries, so thatthe accounting policies and accounting periods adopted by its subsidiaries are consistent with those adopted bythe Company. When preparing consolidated financial statements, it follows the principle of materiality to offsetthe internal exchanges, internal transactions and equity investment projects between the parent company and thesubsidiaries, and between the subsidiaries.
The equity and profit and loss attributable to minority shareholders of the subsidiaries are listed separatelyunder the item of the owners' equity in the consolidated balance sheet and under the item of net profit in theconsolidated income statement. The current loss shared by minority shareholders of a subsidiary exceeds thebalance formed by minority shareholders' share in the initial owners' equity of the subsidiary, thus offsettingminority shareholders' equity.
(1) Increase of subsidiaries and businesses
During the reporting period, when preparing the consolidated balance sheet due to the business mergerunder the same control and the subsidiaries and businesses increased, the opening balance of the consolidatedbalance sheet is adjusted; When preparing the income statement, the income, expenses and profits of thesubsidiary and business merger from the beginning of the current period to the end of the reporting period areincluded in the consolidated income statement; When the cash flow statement is consolidated, the cash flows ofthe subsidiary and the business combination from the beginning of the current period to the end of the reportingperiod are included in the consolidated cash flow statement; At the same time, the relevant items of thecomparative statements shall be adjusted, as if the merged reporting entity had existed since the ultimatecontrolling party started to control.
During the reporting period, when preparing the consolidated balance sheet for subsidiaries and businessesincreased due to business merger not under the same control or other means, the opening balance of the
consolidated balance sheet will not be adjusted. When preparing the income statement, the income, expensesand profits of the subsidiary and the business from the date of purchase to the end of the reporting period shallbe included in the consolidated income statement. When preparing the cash flow statement, the cash flow of thesubsidiary from the date of purchase to the end of the reporting period shall be included in the consolidated cashflow statement.The Company prepares consolidated financial statements based on the amount of identifiable assets,liabilities and contingent liabilities determined on the basis of the fair value on the date of purchase reflected inthe individual financial statements of subsidiaries at the current balance sheet date. The difference between themerger cost and the fair value share of the net identifiable assets of the acquiree obtained in the merger shall berecognized as goodwill. The difference between the merger cost and the fair value share of the net identifiableassets of the acquiree obtained in the merger shall be included in the current profits and losses after review.If the business merger not under the same control is realized step by step through multiple transactions, inthe consolidated financial statements, the equity of the acquiree held before the date of purchase shall be re-measured according to the fair value of the equity on the date of purchase, and the difference between the fairvalue and its book value shall be included in the current investment income. Other comprehensive income of thelong-term equity investment of the acquiree held before the date of purchase under the accounting by equitymethod shall be subject to accounting treatment on the same basis as the direct disposal of relevant assets orliabilities by the investee. Changes in other shareholders' equity except net profits and losses, othercomprehensive income and profit distribution shall be converted into current profits and losses on the date ofpurchase. For other equity instrument investments of the acquiree held before the date of purchase, the changesin fair value of the equity instrument investments accumulated in other comprehensive income before the dateof purchase are transferred to retained profits and losses.
(2) Disposal of subsidiaries and businesses
A. General disposal methodsDuring the reporting period, if the Company disposes of its subsidiaries and businesses, the income,expenses and profits of the subsidiaries and businesses from the beginning to the disposal date will be includedin the consolidated income statement; The cash flow of the subsidiaries and businesses from the beginning tothe disposal date will be included in the consolidated cash flow statement.
If the Company loses control of its original subsidiaries due to the disposal of some equity investments,the remaining equity shall be re-measured according to its fair value on the date of loss of control in theconsolidated financial statements. The sum of the consideration obtained from the disposal of the equity and thefair value of the remaining equity, minus the difference between the share of the net assets that should becontinuously calculated by the original subsidiary from the date of purchase or the date of merger according tothe original shareholding ratio, is included in the current investment income when the control right is lost, andthe goodwill is also offset. Other comprehensive income related to the original subsidiary's equity investment
shall be subject to accounting treatment on the same basis as the subsidiary's direct disposal of relevant assets orliabilities when it loses control. Shareholders' equity recognized due to changes in other shareholders' equityrelated to the original subsidiary except net profit and loss, other comprehensive income and profit distributionshall be converted into current profits and losses when it loses control.B. Dispose of equity step by step until loss of controlIf the enterprise disposes of its equity investment in a subsidiary step by step through multiple transactionsuntil it loses control, if the transaction of disposing of its equity investment in a subsidiary until the loss ofcontrol is a package transaction, it shall treat each transaction as a transaction of disposing of the subsidiary andloss of control; However, the difference between the price of each disposal before the loss of control and theshare of the subsidiary's net assets corresponding to the disposal investment shall be recognized as othercomprehensive income in the consolidated financial statements, and transferred to the current profits and losseswhen the control is lost.The terms, conditions and economic impact of various transactions dealing with equity investment insubsidiaries meet one or more of the following conditions, which usually indicates that multiple transactionsshall be subject to accounting treatment as a package transaction:
(A) These transactions are concluded at the same time or under the consideration of mutual impact;(B) These transactions as a whole can achieve a complete commercial result;(C) The occurrence of one transaction depends on the occurrence of at least one other transaction;(D) A transaction is uneconomical when considered alone, but it is economical when considered togetherwith other transactions.
(3) Purchase of minority shares of the subsidiaries
The Company shall adjust the capital premium or share capital premium in the capital reserve in theconsolidated balance sheet for the difference between the newly acquired long-term equity investment due tothe purchase of minority shares and the share of net identifiable assets that should be continuously calculated bythe subsidiaries from the date of purchase (or date of merger) according to the new shareholding ratio. If thecapital premium or share capital premium in the capital reserve is insufficient to offset, the retained incomeshall be adjusted.
(4) Partial disposal of equity investment in subsidiaries without loss of control
For the difference between the disposal price obtained from the partial disposal of the long-term equityinvestment in the subsidiary and the share of the net assets of the subsidiary that is continuously calculated fromthe date of purchase or the date of merger corresponding to the disposal of the long-term equity investment,adjust the capital premium or share capital premium in the capital reserve in the consolidated balance sheet. Ifthe capital premium or share capital premium in the capital reserve is insufficient to offset, adjust the retainedincome.
8. Classification of joint venture arrangement and accounting treatment for joint control
A joint venture arrangement refers to an arrangement controlled jointly by two or more participants. Jointventure arrangements are divided into joint operation and joint ventures.
1. Joint operation refers to the joint venture arrangement in which the Company is entitled to the assetsrelated to the arrangement and undertakes the liabilities related to the arrangement. The Company recognizesthe following items related to the share of interests in joint operation:
(1) Recognize the assets held separately, and recognize the assets held jointly according to their shares;
(2) Recognize the liabilities undertaken separately, and recognize the liabilities jointly undertakenaccording to their shares;
(3) Recognize the income generated from the sale of its share of joint operation output;
(4) Recognize the income generated by the sale of output in the joint operation according to its share;
(5) Recognize the expenses incurred separately, and recognize the expenses incurred in joint operationaccording to their shares.
2. Joint venture refers to a joint venture arrangement in which the Company has rights only to the netassets of the arrangement. The Company shall carry out accounting treatment for the investment of the jointventure in accordance with the provisions on accounting by equity method for long-term equity investment.
9. Recognition of cash and cash equivalents
When preparing the cash flow statement, the Company will recognize the cash on hand and the depositsthat can be used for payment at any time as cash. An investment with short term (usually due within threemonths from the date of purchase), strong liquidity, easy conversion into known cash and little risk of valuechange will be determined as a cash equivalent. Restricted bank deposits will not be regarded as cash and cashequivalents in the cash flow statement.
10. Foreign currency transaction and financial statement conversion
1. Foreign currency business
When foreign currency business occurs, the amount of foreign currency is converted into RMB forrecording according to the spot exchange rate on the date of transaction, and foreign currency monetary itemsand foreign currency non-monetary items are treated in the following ways at the end of the period:
(1) Foreign currency monetary items are converted at the spot exchange rate on the balance sheet date.Exchange differences arising from the difference between the spot exchange rate on the balance sheet date andthe initial recognition or the spot exchange rate on the previous balance sheet date are included in the currentprofits and losses.
(2) Foreign currency non-monetary items measured at historical cost are still converted at the spotexchange rate on the date of transaction, and the amount of their recording currency will not be changed.
(3) Foreign currency non-monetary items measured at fair value shall be converted at the spot exchangerate on the fair value determination date, and the resulting exchange gains and losses shall be included in thecurrent profits and losses or other comprehensive income.
(4) Foreign currency exchange gains and losses, except the exchange gains and losses arising fromforeign currency special borrowing related to the purchase, construction or production of assets eligible forcapitalization, are included in the cost of assets eligible for capitalization before the assets reach the scheduledserviceable or saleable state, and the rest are included in the current profits and losses.
2. Conversion in foreign currency financial statements
(1) Assets and liabilities in the balance sheet are converted at the spot exchange rate on the balance sheetdate; Except for the "undistributed profit", other items of owners' equity are converted at the spot exchange rateat the time of occurrence.
(2) The income and expenses in the income statement are converted at the approximate exchange rate ofthe spot exchange rate on the date of transaction.
(3) The conversion difference of foreign currency financial statements generated according to the aboveconversion is included in other comprehensive income. When disposing of overseas operations, the conversiondifference of foreign currency financial statements related to the overseas operations shall be transferred fromthe owners' equity to the current profits and losses.
(4) The cash flow statement is converted by the approximate exchange rate of the spot exchange rate onthe date of cash flow occurrence. As a reconciliation item, the influence of exchange rate changes on cash islisted separately in the cash flow statement.
11. Financial instruments
When the Company becomes a party to the financial instrument contract, it recognizes a financial asset orfinancial liability related to it.
1. Classification, recognition basis and measurement method of financial assets
According to the business model of financial assets under management and the contractual cash flowcharacteristics of financial assets, the Company divides financial assets into three categories: financial assetsmeasured by amortized cost, financial assets measured by fair value with its changes included in othercomprehensive income, and financial assets measured by fair value with its changes included in current profitsand losses.
Financial assets are measured at fair value upon initial recognition. For financial assets measured at fairvalue with its changes included in the current profits and losses, relevant transaction costs are directly includedin the current profits and losses; For financial assets of other types, relevant transaction costs are included in theinitial recognition amount. If the accounts receivable initially recognized by the Company do not containsignificant financing components as defined in the Accounting Standards for Business Enterprises No.14-Income, or the financing components in contracts with a duration of no more than one year are not consideredaccording to the provisions of Accounting Standards for Business Enterprises No.14-Income, the initialmeasurement shall be made according to the transaction price of the consideration expected to be charged.
(1) Financial assets measured in amortized cost
The Company's business model of managing such financial assets is to collect contract cash flow, and thecash flow generated on a specific date is only for the payment of principal and interest based on the unpaidprincipal amount. For such financial assets, the Company adopts the effective interest rate method forsubsequent measurement according to amortized cost, and the gains or losses arising from amortization orimpairment are included in the current profits and losses.
(2) Financial assets measured at fair value with changes included in other comprehensive income
The Company's business model of managing such financial assets is to collect contract cash flow and sellit, and the cash flow generated on a specific date is only for the payment of principal and interest based on theunpaid principal amount. Such financial assets are measured at fair value with changes included in othercomprehensive income, but impairment losses or gains, exchange gains and losses and interest incomecalculated according to the effective interest rate method are included in current profits and losses.
For the investment in non-transactional equity instruments, the Company can irrevocably designate it as afinancial asset measured at fair value with changes included in other comprehensive income at the initialrecognition. The designation is made on the basis of a single investment, and the relevant investment conformsto the definition of equity instrument from the issuer's point of view. The Company includes the relevantdividend income of such financial assets in the current profits and losses, and the changes in fair value in othercomprehensive income. When the financial asset is derecognized, the accumulated gains or losses previouslyincluded in other comprehensive income will be transferred from other comprehensive income to retainedincome and will not be included in the current profits and losses.
(3) Financial assets measured at fair value with changes included in the current profits and losses
Except for the above financial assets measured in amortized cost and the financial assets measured at fairvalue with changes included in other comprehensive income, the Company classifies all other financial assets asfinancial assets measured at fair value with changes included in current profits and losses. In addition, at thetime of initial recognition, in order to eliminate or significantly reduce the accounting mismatch, the Companydesignated some financial assets as the financial assets measured at fair value with changes included in thecurrent profits and losses. Such financial assets are subsequently measured at fair value, with changes in fairvalue included in current profits and losses.
2. Classification, recognition basis and measurement method of financial liabilities
The Company's financial liabilities are classified into financial liabilities measured at fair value withchanges included in current profits and losses and other financial liabilities at initial recognition. For financialliabilities measured at fair value with changes included in the current profits and losses, the related transactioncosts are directly included in the current profits and losses, and the related transaction costs of other financialliabilities are included in their initial recognition amount.
(1) Financial liabilities measured at fair value with changes included in the current profits and losses
Financial liabilities measured at fair value with changes included in current profits and losses includetransactional financial liabilities (including derivatives belonging to financial liabilities) and financial liabilitiesdesignated as measured at fair value with changes included in current profits and losses.Transactional financial liabilities (including derivatives belonging to financial liabilities) are subsequentlymeasured at fair value, and changes in fair value are included in current profits and losses, except those relatedto hedging accounting.
For financial liabilities that are designated as being measured at fair value with changes included incurrent profits and losses at the time of initial recognition, the changes in fair value caused by changes in theCompany's own credit risk are included in other comprehensive income, and when the liability is derecognized,the accumulated changes in its fair value caused by changes in its own credit risk included in othercomprehensive income are transferred to retained income. Other changes in fair value are included in currentprofits and losses. If the accounting mismatch in profit and loss will be caused or enlarged by handling theimpact of the changes in credit risk of these financial liabilities in the above way, the Company will include allthe gains or losses of the financial liabilities (including the amount affected by the changes in the enterprise'scredit risk) in the current profits and losses.
(2) Other financial liabilities
Other financial liabilities, except those caused by the transfer of financial assets and financial guaranteecontracts that do not meet the conditions for derecognition or continue to be involved in the transferred financialassets, are classified as financial liabilities measured in amortized cost and subsequently measured in amortizedcost. The gains or losses arising from derecognition or amortization are included in the current profits and losses.
3. Methods for determining the fair value of financial assets and financial liabilities
The fair value of financial instruments with an active market shall be determined by the quotation in theactive market. The fair value of financial instruments without active market shall be determined by valuationtechnology. At the time of valuation, the Company adopts the valuation technology that is applicable in thecurrent situation and supported by sufficient available data and other information, selects the input values thatare consistent with the characteristics of assets or liabilities considered by market participants in the transactionof relevant assets or liabilities, and gives priority to the relevant observable input values. Unobservable inputvalues can only be used if the relevant observable input values are unavailable or impracticable.
4. Recognition basis and measurement method for transfer of financial assets
Recognition for transfer of financial assets
| Circumstances | Recognition results |
| Almost all risks and rewards in the ownership of financial assets are transferred | The financial assets are derecognized (new assets/liabilities are recognized) |
Almost all risks andrewards in the ownership offinancial assets are neithertransferred nor retained
| Almost all risks and rewards in the ownership of financial assets are neither transferred nor retained | The control of financial assets is given up | |
| The control of financial assets is not given up | The relevant assets and liabilities is recognized according to the extent of continuing involvement in the |
| transferred financial assets | ||
| Almost all risks and rewards in the ownership of financial assets are retained | Continue to recognize the financial assets and recognize the received consideration as financial liabilities | |
The Company divides the transfer of financial assets into the overall transfer and partial transfer offinancial assets.
(1) If the overall transfer of financial assets meets the conditions for derecognition, the difference betweenthe following two amounts shall be included in the current profits and losses: the book value of the transferredfinancial assets on the derecognition date; The sum of the consideration received for the transfer of financialassets and the cumulative amount of changes in fair value that were originally directly included in othercomprehensive income (the financial assets involved in the transfer are those classified as financial assetsmeasured at fair value with changes included in other comprehensive income in Article 18 of AccountingStandards for Business Enterprises No.22-Recognition and Measurement of Financial Instruments).
(2) If a part of the financial assets is transferred, and the transferred part as a whole meets the conditionsfor derecognition, the book value of the whole financial assets before the transfer shall be allocated between thederecognition part and the continued recognition part (in this case, the retained service assets shall be regardedas part of continued recognition of financial asset) according to their respective relative fair values on the dateof transfer, and the difference between the following two amounts shall be included in the current profits andlosses: the book value of the derecognition part on the derecognition date; The sum of the considerationreceived for the derecognition part (including all new assets acquired minus all new liabilities assumed) and thecorresponding derecognition amount in the accumulated amount of changes in fair value originally included inother comprehensive income (the financial assets involved in partial transfer are those classified as financialassets measured at fair value with changes included in other comprehensive income in Article 18 of AccountingStandards for Business Enterprises No.22-Recognition and Measurement of Financial Instruments).
If the transfer of financial assets does not meet the conditions for derecognition, the whole transferredfinancial assets shall be continuously recognized, and the received consideration shall be recognized as afinancial liability.
5. Conditions for derecognition of financial liabilities
If the current obligations of financial liabilities(or part of them) have been discharged, the financialliabilities (or part of them) shall be derecognized. If the following conditions exist:
(1) If the Company transfers the assets used to pay financial liabilities to an institution or establishes atrust, and the obligation of debt payment still exists, it shall not derecognize the financial liabilities.
(2) The Company (the borrower) and the lender sign an agreement to replace the original financialliabilities (or part of them) by taking on new financial liabilities, and the contractual terms are essentiallydifferent. The Company shall derecognize the original financial liabilities (or part of them) and recognize a newfinancial liability at the same time.
If the financial liabilities (or part of them) are derecognized, the Company will record the differencebetween the book value and the consideration paid (including the transferred non-cash assets or liabilities) intothe current profits and losses.
6. Impairment of financial assets
(1) Recognition method of impairment provision
The Company conducts impairment accounting treatment on financial assets (including receivables)measured in amortized cost, debt instrument investment and lease receivables measured at fair value withchanges included in other comprehensive income on the basis of expected credit losses, and recognizes the lossprovisions. In addition, for contract assets, loan commitments and financial guarantee contracts, impairmentprovisions are also accrued and impairment losses are recognized in accordance with the accounting policiesdescribed in this section.
Expected credit loss refers to the weighted mean of credit loss of financial instruments weighted by therisk of default. Credit loss refers to the difference between all contracted cash flows that the Companydiscounted at the original actual interest rate and all cash flows that it is expected to receive, that is, the presentvalue of all cash shortages.
Except for the purchased or originated financial assets with credit impairment, the Company evaluateswhether the credit risk of relevant financial assets has increased significantly since the initial recognition oneach balance sheet date. If the credit risk has not increased significantly since the initial recognition. it is in thefirst stage, and the Company will measure the loss provision according to the amount equivalent to the expectedcredit loss of the financial asset in the next 12 months; If the credit risk has increased significantly since theinitial recognition but with no credit impairment, it is in the second stage, and the Company will measure theloss provision according to the amount equivalent to the expected credit loss of the financial asset during thewhole duration; If the financial asset has suffered credit impairment since its initial recognition, it is in the thirdstage, and the Company will measure the loss provision according to the amount equivalent to the expectedcredit loss of the financial asset in the whole duration. When evaluating the expected credit loss, the Companyconsiders the reasonable and well-founded information, including forward-looking information, about pastevents, current situation and future economic situation prediction that can be obtained on the balance sheet datewithout unnecessary extra cost or effort.
The expected credit loss in the next 12 months refers to the expected credit loss caused by financial assetdefault events that may occur within 12 months after the balance sheet date (if the expected duration of financialassets is less than 12 months, within the expected duration), which is a part of the expected credit loss in thewhole duration.
For financial instruments with low credit risk on the balance sheet date, the Company assumes that thecredit risk has not increased significantly since the initial recognition, and chooses to measure the loss provisionaccording to the expected credit loss in the next 12 months.
For the financial assets in the first and second stages and with low credit risk, the Company calculates theinterest income according to the book balance without deducting the impairment provision and the actualinterest rate. For the financial assets in the third stage, the interest income shall be calculated according to thebook balance minus the amortized cost and the actual interest rate after the impairment provision has beenaccrued.
(2) Financial asset with impairment
When the Company anticipates that one or more events that have an adverse effect on the future cash flowof a financial asset occur, the financial asset becomes a financial asset with credit impairment. Evidence ofcredit impairment of financial assets includes the following observable information:
A. The issuer or the debtor has major financial difficulties;
B. The debtor has breached the contract, such as default or overdue payment of interest or principal;
C. The creditor makes concessions to the debtor that it will not make under any other circumstances due toeconomic or contractual considerations related to its financial difficulties;
D. The debtor is likely to go bankrupt or carry out other financial restructuring;
E. The financial difficulties of the issuer or debtor lead to the disappearance of the active market of thefinancial asset;
F. A financial asset is purchased or originated at a large discount, which reflects the fact that credit losshas occurred.
Credit impairment of financial assets may be caused by the joint action of multiple events, not necessarilyby an event that can be identified separately.
(3) Financial assets with credit impairment purchased or originated
For the purchased or originated financial assets with credit impairment, the Company only recognizes thecumulative change of expected credit loss in the whole duration after initial recognition as loss provision on thebalance sheet date. On each balance sheet date, the change amount of expected credit loss during the wholeduration is included in the current profits and losses as impairment loss or gain. Even if the expected credit lossdetermined on the balance sheet date is less than the amount of the expected credit loss reflected by theestimated cash flow at the time of initial recognition, the favorable change of expected credit loss will berecognized as impairment gain.
(4) Criteria for judging significant increase in credit risk
If the default probability of a financial asset in the estimated duration determined on the balance sheet dateis significantly higher than that in the estimated duration determined at the initial recognition, it indicates thatthe credit risk of the financial asset is significantly increased. Except in special circumstances, the Companyuses the change of default risk in the next 12 months as a reasonable estimate of the change in default risk in thewhole duration to determine whether the credit risk has increased significantly since the initial recognition.
(5) Method of evaluating the expected credit loss of financial assets
The Company evaluates the expected credit loss of financial assets based on individual and combineditems. It individually evaluates the credit risk of financial assets with significantly different credit risks, such as:
receivables from related parties; accounts receivable from government agencies and units; and receivables withobvious signs that the debtor is likely to be unable to fulfill the repayment obligations.
Except for financial assets whose credit risks are individually evaluated, the Company divides financialassets into different groups based on common risk characteristics, and evaluates the credit risks on the basis ofcombination.
(6) Accounting treatment method for impairment of financial assets
The Company calculates the expected credit losses of various financial assets on the balance sheet date,and the resulting increase or reversal amount of loss provision is included in the current profits and losses asimpairment losses or gains.
If the Company actually suffers from credit losses, and the relevant financial assets are determined to beirrecoverable and approved for write-off, the book balance of the financial assets will be directly written down.If the financial assets written down are recovered later, they will be included in the current profits and losses ofrecovery as the reversal of impairment losses.
7. Financial guarantee contract
A financial guarantee contract refers to a contract in which the issuer pays a certain amount to the contractholder who has suffered losses when the debtor fails to repay the debt according to the original or revised termsof the debt instrument at maturity. The financial guarantee contract shall be measured at fair value upon initialrecognition. For the financial guarantee contract for a financial liability not designated as being measured at fairvalue with changes included into the current profits and losses, after the initial recognition, subsequentmeasurement shall be made according to the higher of the expected credit loss provision amount determined onthe balance sheet date and the balance of the initial recognition amount after deducting the accumulatedamortization amount determined according to the income recognition principle.
8. Offset of financial assets and financial liabilities
Financial assets and financial liabilities are listed separately in the balance sheet without mutual offset.However, if the following conditions are met at the same time, the net amount after mutual offset shall be listedin the balance sheet:
(1) The Company has the legal right to offset the recognized financial assets and financial liabilities, andsuch legal right is now enforceable;
(2) The Company plans to settle accounts by netting, or realize the financial assets and pay off thefinancial liabilities at the same time.
9. Equity instruments
Equity instruments refer to contracts that can prove that the Company has residual interests in assets afterdeducting all liabilities. The issuance (including refinancing), repurchase, sale or cancellation of equity
instruments by the Company are treated as changes in equity. The Company does not recognize changes in thefair value of equity instruments. Transaction costs related to equity transactions are deducted from equity.Various distributions (excluding stock dividends) made by the Company to holders of equity instrumentsare used as profit distribution to reduce the owners' equity. The stock dividends distributed do not affect thetotal owners' equity.The Company shall comply with the disclosure requirement of jewelry-related industries in the “ShenzhenStock Exchange Self-Regulatory Guidelines for Listed Companies No. 3- Industry Disclosure”Nil
12. Note receivable
The Company measures the loss provision for notes receivable according to the expected credit lossamount of the whole duration.Except for the notes receivable whose credit risk is evaluated individually, the Company divides the notesreceivable into different portfolios based on the credit risk of their acceptors as a common risk characteristic,and calculates the expected credit loss on the basis of the portfolios. The basis for determining the portfolios isas follows:
| Portfolio name | Basis for determining the portfolio |
| Bank acceptance bill | Management evaluation has low credit risk and the expected credit loss is generally not recognized |
| Commercial acceptance bill | Same as "Accounts Receivable" portfolio |
The Company individually tests the impairment of the notes receivable with objective evidence and othernotes that are suitable for individual evaluation, recognizes the expected credit loss, and calculates theindividual impairment provision.
13. Account receivable
The CBC adopts the simplified model of expected credit loss for accounts receivables specified in “AccountingStandards for Business Enterprises No.14 - Revenue” and without containing significant financing components(including the case that the financing components in contracts that do not exceed one year are not consideredaccording to the standards), that is, always measures their loss provisions according to the amount of expectedcredit loss during the entire duration, and the resulting increased or reversed amount of the loss provision isincluded in the current profit and loss as an impairment loss or gain.
Based on common risk characteristics, the Company divides accounts receivable into different groupsaccording to common credit risk characteristics such as customer categories:
| Portfolio name | Basis for determining the portfolio |
| Individual identification portfolio | Commercial acceptance bills receivable, accounts receivable and other receivables with significant single amount |
| (receivables with an ending balance of more than RMB 5 million (including RMB 5 million)), or accounts receivable with insignificant individual amount but high risk | |
| Aging portfolio | Taking the aging of receivables as the credit risk characteristic |
| Related-party portfolio receivable | Receivables from related parties |
(1) Individual identification portfolio: For receivables with an ending balance of more than RMB 5million (including RMB 5 million), or accounts receivable with insignificant individual amount but high risk,impairment test shall be conducted separately for each customer. Impairment test shall be conducted separatelyfor accounts receivable with objective evidence indicating impairment and other accounts receivable applicableto individual evaluation (such as accounts receivable in dispute with the other party or involving litigation andarbitration; accounts receivable with obvious signs that the debtor is likely to be unable to fulfill the repaymentobligations, etc.), to recognize expected credit loss and calculate individual impairment provision.
(2) Aging portfolio: For accounts receivable that have not been impaired after individual testing or whoseindividual amount is not significant but with low risk, the Company evaluates the expected credit loss of variousaccounts receivable based on the actual loss rate of the same or similar accounts receivable portfolio withsimilar credit risk characteristics in previous years.
(3) Associated portfolio: Unless there is conclusive evidence indicating an impairment, the accountsreceivable formed between related parties shall not be accrued for bad debt provision.
14. Receivable financing
Receivable financing reflects notes receivable and accounts receivable that are measured at fair value onthe balance sheet date with changes included in other comprehensive income. For the accounting treatmentmethod, please refer to the related treatment of the financial assets measured at fair value with changes includedin other comprehensive income classified in Item (XI) Financial Instrument of this accounting policy.
15. Other account receivable
For other receivables, the expected credit loss is determined according to historical data and forward-looking information. Based on whether the credit risk of other receivables has increased significantly since theinitial recognition, the Company adopts the amount equivalent to the expected credit loss in the next 12 monthsor the whole duration to measure the impairment loss. For specific accounting treatment methods, please referto Item (XIII) Accounts Receivable of this accounting policy.
16. Contractual assets
Contract assets refer to the right that the Company has transferred the goods to customers and has the rightto receive consideration, and such right depends on other factors besides the passage of time.
Nil
17. Inventory
The Company shall comply with the disclosure requirement of jewelry-related industries in the “ShenzhenStock Exchange Self-Regulatory Guidelines for Listed Companies No. 3- Industry Disclosure”
(1) Classification of inventory
The CBC classifies the inventory into raw materials, goods in process, goods on hand, wrap page, low valueconsumables, materials for consigned processing and goods sold, etc.
(2) Valuation of inventories
Inventories are initially measured at cost upon acquisition, which includes procurement costs, processing costsand other costs. Cost of the inventory issued is carried forward on the basis of a combination of the weightedaverage method and specific identification when inventories are issued.
(3)Inventory system
Perpetual inventory system is adopted.
(4) Amortization method of low-value consumables and packaging materials
"One-time amortization method" is adopted for accounting.
(5) Provision for inventory impairment
When a comprehensive count of inventories is done at the end of the period, provision for inventory impairment isallocated or adjusted using the lower of the cost of inventory and the net realizable value. The net realizable valueof stock in inventory (including finished products, goods in stock and materials for sale) that can be sold directlyis determined using the estimated saleable price of such inventory deducted by the cost of sales and relevanttaxation over the course of ordinary production and operation. The net realizable value of material in inventorythat requires processing is determined using the estimated saleable price of the finished product deducted by thecost to completion, estimated cost of sales and relevant taxation over the course of ordinary production andoperation. The net realizable value of inventory held for performance of sales contract or labor service contract isdetermined based on the contractual price; in case the amount of inventory held exceeds the contractual amount,the net realizable value of the excess portion of inventory is calculated using the normal saleable price.Provision for impairment is made according to individual items of inventories at the end of the period; however,for inventories with large quantity and low unit price, the provision is made by categories; inventories of productsthat are produced and sold in the same region or with the same or similar purpose or usage and are difficult to bemeasured separately are combined for provision for impairment.If the factors causing a previous write-off of inventory value has disappeared, the amount written-off is reversedand the amount provided for inventory impairment is reversed and recognized in profit or loss for the period.During the reporting period, the specific methods and implementation of the Company's inventoryimpairment measurement are as follows:
(1) Inventory impairment method
The issuer's inventory mainly includes raw materials, inventory goods and materials commissioned forprocessing. The ending inventory of the Company is measured according to the lower of cost and net realizablevalue. When the net realizable value is lower than the cost, the inventory depreciation provision is accrued.
①Specific methods for measuring the impairment of raw materials
Raw materials mainly include gold and diamond raw materials. The closing net realizable value of goldraw materials is determined according to the closing price of spot gold trading announced by Shanghai GoldExchange at the end of the period. For the part with the book cost higher than the closing net realizable value,inventory depreciation provision is accrued; Diamond raw materials are used for processing finished diamondinlaid products, but the finished diamond inlaid products are with great difference. At the end of the year, theCompany will comprehensively judge whether there are signs of impairment based on the price fluctuation ofdiamonds in that year, processing rates and pricing policies, and if there are signs of impairment, it will measurethe impairment one by one.
② Specific methods for measuring the impairment of inventory goods
Inventory goods mainly include finished gold products, finished K-gold products and finished inlaidproducts. The depreciation of finished gold products and finished K-gold products shall be measured one by one,and the closing net realizable value shall be determined by referring to the sales outbound price at the end of theperiod after deducting the relevant sales expenses and taxes. For finished products whose closing book cost ishigher than the net realizable value, the inventory depreciation provision shall be accrued. The finished inlaidproducts are quite different. At the end of the period, the Company will comprehensively judge whether thereare signs of impairment according to the price fluctuation of diamonds in that year and the pricing policy. Ifthere are signs of impairment, the impairment will be measured one by one.
③ Specific methods for measuring the impairment of materials commissioned for processing
Materials commissioned for processing mainly include gold and diamond raw materials, which are similarin nature to raw materials, so the measurement method is consistent with that of raw materials.
18. Assets held for sale
1. Basis for classification as non-current assets held for sale or disposal group
If the book value of an non-current asset is recovered mainly through sales (including the exchange ofnon-monetary assets with commercial substance) rather than continuous use or disposal group, the Companywill classify it as held for sale. The specific standard is to meet the following conditions at the same time:
(1) According to the practice of sales of such assets or disposal groups in similar transactions, they can besold immediately under the current situation;
(2) The Company has made a resolution on a sale plan and obtained a firm purchase commitment. It isexpected that the sale will be completed within one year (if the relevant regulations require the approval of therelevant authority or regulatory department of the Company before the sale, such approval has been obtained).If the control right of the subsidiary is lost due to the sale of the investment in the subsidiary, regardless ofwhether part of the equity investment is retained after the sale and the conditions for classification of the held-for-sale category are met, the investment in the subsidiary as a whole will be classified as held-for-sale categoryin the individual financial statements of the parent company, and all assets and liabilities of the subsidiary willbe classified as held-for-sale category in the consolidated financial statements.
2. Accounting treatment of non-current assets or disposal groups held for sale
When the Company initially measures or re-measures the non-current assets or disposal groups held forsale on the balance sheet date, if the book value is higher than the net amount of fair value minus the saleexpenses, the book value will be written down to the net amount of fair value minus the sale expenses, and thewritten-down amount will be recognized as asset impairment loss and included in the current profits and losses,and impairment provision of assets held for sale will be accrued at the same time. If the net amount of the fairvalue of non-current assets held for sale on the subsequent balance sheet date is increased after deducting thesale expenses, the previously written-down amount will be restored and reversed within the amount of assetimpairment loss recognized after being classified as held for sale, and the reversed amount will be included inthe current profits and losses. Assets impairment losses recognized before being classified as held for sale shallnot be reversed.
For the amount of asset impairment loss recognized by the disposal group held for sale, the book value ofgoodwill in the disposal group shall be deducted first, and then the book value of non-current assets in thedisposal group shall be deducted proportionally according to the proportion of the book value of non-currentassets in the disposal group. For the subsequent reversal amount of asset impairment losses recognized by thedisposal group held for sale, the book value will be increased in proportion according to the proportion of thebook value of non-current assets except goodwill in the disposal group.
Non-current assets held for sale or non-current assets in disposal group are not depreciated or amortized,and interest and other expenses of liabilities in disposal group held for sale continue to be recognized.
When the Company derecognizes the non-current assets held for sale or disposal groups, the unrecognizedgains or losses will be included in the current profits and losses.
When non-current assets or disposal groups are no longer classified as held for sale because they nolonger meet the classification conditions of held for sale, or non-current assets are removed from the disposalgroups held for sale, the measurement shall be based on the lower of the following two amounts:
(1) For the book value before being classified as held for sale, the adjusted amount based on depreciation,amortization or impairment that should have been recognized if it is not classified as held for sale;
(2) Recoverable amount.
3. Determination standard and presentation method of discontinued operation
Discontinued operations refers to a component that meets any of the following conditions and can bedistinguished separately and has been disposed of by the Company or classified as a component held for sale:
(1) This component represents an independent main business or a single main business area;
(2) This component is part of an associated plan to dispose of an independent main business or a separatemain business area;
(3) This component is a subsidiary acquired exclusively for resale.
For the discontinued operation listed in the current period, the Company separately lists the profit and lossof continuing operation and the profit and loss of discontinued operation in the current income statement, andre-lists the information originally listed as the profit and loss of continuing operation as the profit and loss ofdiscontinued operation in comparable accounting period in the income statement of the comparative period.
19. Debt investment
For debt investment, the Company determines the expected credit loss on each balance sheet dateaccording to the types of counterparties and risk exposures and in consideration of historical default andindustry forward-looking information or various external actual and expected economic information. For thedetermination method and accounting treatment method of expected credit loss, please refer to the provisions ofItem (XI) Financial Instruments of this accounting policy.
20. Other debt investment
For Other debt investment, the Company determines the expected credit loss on each balance sheet dateaccording to the types of counterparties and risk exposures and in consideration of historical default andindustry forward-looking information or various external actual and expected economic information. For thedetermination method and accounting treatment method of expected credit loss, please refer to the provisions ofItem (XI) Financial Instruments of this accounting policy.
21. Long-term account receivable
The Company's long-term receivables include receivable financial lease and other long-term receivables.
For the receivable financial lease formed by the transactions regulated in Accounting Standards forBusiness Enterprises No.21-Lease, the loss provision shall be measured according to the amount equivalent tothe expected credit loss during the whole duration.
For other long-term receivables, the Company determines the expected credit loss on each balance sheetdate according to the types of counterparties and risk exposures and in consideration of historical default andreasonable forward-looking information or various external actual and expected economic information.
Based on whether the credit risk has increased significantly since the initial recognition, the Companyadopts the amount equivalent to the expected credit loss in the next 12 months or the whole duration to measurethe impairment loss of long-term receivables. Except for the long-term receivables whose credit risk isevaluated individually, they are divided into different portfolios based on their credit risk characteristics:
| Portfolio name | Basis for determining the portfolio |
| Normal long-term receivables | This portfolio is a long-term receivable with no overdue risk |
| Overdue long-term receivables | This portfolio is a long-term receivable with high overdue risk |
| …… |
22. Long-term equity investment
1. Basis for determining joint control and significant influence on the investee
Joint control refers to the common control of an arrangement according to the relevant agreement, and thatthe related activities of the arrangement must be unanimously agreed by the participants who share the controlrights before making decisions. When judging whether there is joint control, firstly, it is judged whether allparticipants or a group of participants collectively control the arrangement. If all participants or a group ofparticipants must act in concert to decide the related activities of an arrangement, it is considered that allparticipants or a group of participants collectively control the arrangement. Secondly, it is judged whether thedecision of the related activities of the arrangement must be unanimously agreed by the participants whocollectively control the arrangement, and joint control can only be formed if and only if the decision of therelated activities requires the unanimous consent of the participants who collectively control the arrangement. Ifthere are two or more participants who can collectively control an arrangement, it does not constitute jointcontrol. When judging whether there is joint control, the protective rights enjoyed are not considered.
Significant influence refers to that the investor has the right to participate in the decision-making of thefinancial and operating policies of the investee, but it cannot control or jointly control the formulation of thesepolicies with other parties. When determining whether a significant influence can be exerted on the investee,consider the influence of the investor's direct or indirect holding of the voting shares of the investee and thepotential voting rights held by the investor and other parties in the current period after it is assumed to beconverted into the equity of the investee, including the influence of the current convertible warrants, stockoptions and convertible corporate bonds issued by the investee. When foreign investment meets the followingconditions, it is generally determined that it has a significant impact on the investing unit: ① It is represented inthe Board of Directors or similar authority of the investee; ② It participates in the formulation of the financialand business policies of the investee; ③ Important transactions with the investee occur; ④ Managementpersonnel are sent to the investee; ⑤ Key technical data is provided to the investee. When directly or indirectlyowning more than 20% but less than 50% of the voting shares of the investee, it is generally considered to havea significant impact on the investee.
2. Determination of initial investment cost
(1) Long-term equity investment formed by business merger
A. In the case of business merger under the same control, if cash payment, transfer of non-cash assets ortaking on debts and issuance of equity securities are adopted as the merger consideration, the initial investmentcost of long-term equity investment shall be the share of the book value of the owners' equity of the mergedparty in the consolidated financial statements of the final controlling party on the date of merger. If the investeeunder the same control can be controlled due to additional investment and other reasons, the initial investmentcost of long-term equity investment shall be determined according to the share of the net assets of the mergedparty in the book value of the consolidated financial statements of the final controlling party on the date ofmerger. For the difference between the initial investment cost of the long-term equity investment on the date ofmerger and the book value of the long-term equity investment before the merger plus the book value of thenewly paid consideration for the shares on the date of merger, adjust the capital premium or share capitalpremium. If the capital premium or share capital premium is insufficient to offset, the retained income will beoffset.B. For the business merger not under the same control, the merger cost shall be determined as the initialinvestment cost of long-term equity investment on the date of purchase in accordance with the relevantprovisions of the Accounting Standards for Business Enterprises No.20-Business Merger. If the investees notunder the same control can be controlled due to additional investment and other reasons, the sum of the bookvalue of the original equity investment plus the new investment cost shall be taken as the initial investment costcalculated by the cost method.
(2) In addition to the long-term equity investment formed by business merger, the initial investment costof long-term equity investment obtained by other means shall be determined in accordance with the followingprovisions:
A. For long-term equity investment obtained by paying cash, the initial investment cost shall be the actualpurchase price. The initial investment cost includes expenses, taxes and other necessary expenses directlyrelated to obtaining long-term equity investment.
B. For long-term equity investment obtained by issuing equity securities, the initial investment cost shallbe the fair value of issuing equity securities.
C. For long-term equity investment obtained by exchange of non-monetary assets, the initial investmentcost shall be determined in accordance with the Accounting Standards for Business Enterprises No.7-Exchangeof Non-monetary Assets.
D. For long-term equity investment obtained by debt restructuring, its initial investment cost shall bedetermined in accordance with the Accounting Standards for Business Enterprises No.12-Debt Restructuring.
3. Subsequent measurement and profit and loss recognition method
(1) Accounting by cost method: Long-term equity investment that can be controlled by the investee shallbe accounted by cost method. When accounting by cost method, the cost of long-term equity investment isadjusted by adding or recovering investment. For the long-term equity investment accounted by the cost method,except for the declared but undistributed cash dividends or profits included in the price or consideration actuallypaid at the time of investment, the Company shall recognize the investment income according to the cashdividends or profits declared by the investee, and no longer distinguish whether it belongs to the net profitrealized by the investee before and after the investment.
(2) Accounting by equity method: For the long-term equity investment jointly controlled or significantlyinfluenced by the investee, except for the equity investment in the associated enterprise, part of it is indirectlyheld by venture capital institutions, mutual funds, trust companies or similar entities including investment withinsurance funds, regardless of whether the above entities have a significant influence on this part of theinvestment, the Company to measure this part of the indirectly held investment at fair value with its changesincluded in profits and losses in accordance with the relevant provisions of Accounting Standards for BusinessEnterprises No.22-Recognition and Measurement of Financial Instruments, and adopts the equity method foraccounting. When accounting by equity method, after the Company obtains the long-term equity investment,the investment income and other comprehensive income are recognized respectively according to the share ofthe net profit and loss and other comprehensive income realized by the investee, and the book value of the long-term equity investment is adjusted; The Company shall calculate its share according to the profit or cashdividend declared by the investee, and correspondingly reduce the book value of long-term equity investment;The Company shall adjust the book value of the long-term equity investment and include it in the owners' equityfor other changes in the owners' equity of the investee except the net profit and loss, other comprehensiveincome and profit distribution. The Company recognizes the net loss of the investee to the extent that the bookvalue of the long-term equity investment and other long-term rights and interests that substantially constitute thenet investment of the investee are written down to zero, unless the Company has the obligation to bearadditional losses. If the investee realizes the net profit in the future, the Company will resume the recognition ofthe income share after the income share makes up for the unrecognized loss share. When recognizing the shareof the net profit and loss of the investee, the Company will adjust the net profit of the investee based on the fairvalue of the identifiable assets of the investee at the time of investment, and offset the gains and losses ofinternal transactions between the Company and associated enterprises and joint ventures, and recognize theinvestment profit and loss on this basis. The internal transaction losses between the Company and the investeeshall be recognized in full if they belong to asset impairment losses according to the Accounting Standards forBusiness Enterprises No.8-Asset Impairment. If the accounting policies and accounting periods adopted by theinvestee are inconsistent with those of the Company, the financial statements of the investee shall be adjustedaccording to the accounting policies and accounting periods of the Company, so as to recognize the investmentprofits and losses.
Long-term equity investments in associated enterprises and joint ventures held before the first executiondate, if there is any debit difference of equity investments related to the investment, shall be amortized by theoriginal remaining term straight-line method, and the amortized amount shall be included in the current profitsand losses.
(3) When disposing of long-term equity investment, the difference between its book value and the actualpurchase price is included in the current profits and losses. If the long-term equity investment accounted byequity method is included in the owners' equity due to other changes in the owners' equity of the investee exceptthe net profit and loss, the part originally included in the owners' equity will be transferred to the current profitsand losses in proportion when disposing of the investment, except for other comprehensive income arising fromthe investee's re-measurement of the changes in defined benefit plan net liabilities or net assets.
23. Investment real estate
Measurement modeMeasured by cost methodDepreciation or amortization method
Investment real estate refers to real estate held to earn rent or capital appreciation, or both. It includesleased land use rights, land use rights held and ready to be transferred after appreciation, and leased buildings.When the Company can obtain rental income or value-added income related to investment real estate and thecost of investment real estate can be measured reliably, the Company will initially measure it according to theactual expenditure of purchase or construction.
The Company adopts the cost model to measure the investment real estate on the balance sheet date.Under the cost model, the Company measures the investment real estate and makes depreciation or amortizationin accordance with the provisions of Item (23) Fixed Assets and Item (26) Intangible Assets of this accountingpolicy. When the investment real estate is disposed of, or permanently withdrawn from use, and it is notexpected to obtain economic benefits from its disposal, the recognition of the investment real estate shall beterminated. When the Company sells, transfers, scraps or damages the investment real estate, the amount ofdisposal income after deducting its book value and relevant taxes shall be included in the current profits andlosses.
24. Fixed assets
(1) Recognition conditions
Fixed assets refer to tangible assets with a service life of more than one fiscal year, which are held forproducing goods, providing labor services, leasing or managing.
(2) Depreciation methods
| Category | Method | Years of depreciation | Scrap value rate | Yearly depreciation rate |
| Houses and buildings | Straight-line depreciation | 20 | 10% | 4.5% |
| Machinery equipment | Straight-line depreciation | 10 | 10% | 9% |
| Transportation equipment | Straight-line depreciation | 5 | 10% | 18% |
| Electronic equipment and others | Straight-line depreciation | 5 | 10% | 18% |
25. Construction in progress
The construction in progress is measured according to the actual cost, which includes all necessary projectexpenditures incurred during the construction period, borrowing costs that should be capitalized before theproject reaches the scheduled serviceable state, and other related expenses.Construction in progress is carried forward to fixed assets when it reaches the scheduled serviceable state.The criteria for scheduled serviceable state shall meet one of the following conditions:
(1) The physical construction (including installation) or production of fixed assets has been completely orsubstantially completed;
(2) It has been put into trial production or trial operation, and the results show that the assets can normallyproduce qualified products, or the trial operation results show that it can operate or operate properly;
(3) The amount of expenditure that continues to occur on fixed assets purchased, constructed or producedis very small or almost none;
(4) The fixed assets purchased, constructed or produced have reached the design or contract requirements,or are basically in line with the design or contract requirements.
26. Borrowing expenses
1. Recognition principle of capitalization of borrowing costs
Borrowing costs include interest incurred by borrowing, amortization of discount or premium andauxiliary expenses, as well as exchange difference incurred by borrowing in foreign currency. If the borrowingcosts incurred by the Company can be directly attributed to the purchase, construction or production of assetsthat meet the capitalization conditions, they shall be capitalized and included in the cost of relevant assets;Other borrowing costs shall be recognized as expenses when incurred according to the amount incurred, andincluded in the current profits and losses.
Assets eligible for capitalization include fixed assets, investment real estate, inventory and other assetsthat need to go through a long period of purchase, construction or production activities to reach thepredetermined serviceable or saleable state.Borrowing costs shall be capitalized when the following conditions are met at the same time:
(1) Asset expenditure has occurred, including the expenditure occurred in the form of paying cash,transferring non-cash assets or undertaking interest-bearing debts for purchasing, constructing or producingassets that meet capitalization conditions;
(2) Borrowing costs have been incurred;
(3) The purchase, construction or production activities necessary to make the assets reach the expectedserviceable or saleable state have started.
2. Period of capitalization of borrowing costs
Borrowing expenses incurred for purchasing, constructing or producing assets that meet the capitalizationconditions, if they meet the above capitalization conditions and occur before the assets reach the predeterminedserviceable or saleable state, shall be included in the cost of the assets; If the purchase, construction orproduction activities of the assets are abnormally interrupted for more than 3 months, the capitalization ofborrowing costs shall be suspended and recognized as current expenses until the purchase, construction orproduction activities of the assets resume; When the purchased, constructed or produced assets reach thepredetermined serviceable or saleable state, the capitalization of their borrowing costs will be stopped.Borrowing costs incurred after reaching the intended serviceable or saleable state are directly included infinancial expenses in the current period.
3. Calculation method of capitalized amount of borrowing costs
During the capitalization period, the capitalization amount of interest (including amortization of discountor premium) in each accounting period shall be determined in accordance with the following provisions:
(1) Where a special borrowing is borrowed for the purpose of purchasing, constructing or producing assetsthat meet the capitalization conditions, it shall be determined by the actual interest expenses incurred in thecurrent period of the special borrowing, minus the interest income obtained by depositing unused borrowingfunds in the bank or the investment income obtained by temporary investment.
(2) If the general borrowing is occupied for the purpose of purchasing, constructing or producing assetsthat meet the capitalization conditions, the interest amount that should be capitalized on the general loan shallbe calculated and determined according to the weighted mean of the accumulated asset expenditure exceedingthe special borrowing portion multiplied by the capitalization rate of the occupied general borrowing.
27. Biological assets
Nil
28. Oil and gas asset
Nil
29. Intangible assets
(1) Service life and its determination basis, estimation, amortization method or review procedure
1. Service life and its determination basis, estimation, amortization method or review procedureIntangible assets are measured at actual cost. The cost of outsourced intangible assets includes thepurchase price, relevant taxes, and other expenses directly attributable to making the assets reach the intendeduse. If intangible assets are purchased by installment, and the purchase price of intangible assets exceeds thenormal credit conditions and actually with financing nature, the cost of intangible assets is the present value ofthe purchase price. The cost of intangible assets invested by investors shall be determined according to the valueagreed in the investment contract or agreement. If the value agreed in the investment contract or agreement isunfair, it shall be recorded according to the fair value of intangible assets. For intangible assets obtained byexchange of non-monetary assets, the initial investment cost shall be determined in accordance with theAccounting Standards for Business Enterprises No.7-Exchange of Non-monetary Assets. For intangible assetsobtained by debt restructuring, its initial investment cost shall be determined in accordance with the AccountingStandards for Business Enterprises No.12-Debt Restructuring. For intangible assets acquired by merger ofenterprises under the same control, their entry value shall be determined according to the book value of themerged party; For intangible assets acquired by merger of enterprises not under the same control, their entryvalue shall be determined at the fair value.The Company analyzes and judges the service life of intangible assets when acquiring them, and dividesthem into intangible assets with limited service life and intangible assets with uncertain service life. Intangibleassets with limited service life shall be amortized within the expected service life by adopting the amortizationmethod that can reflect the expected realization mode of economic benefits related to such assets from the timewhen the intangible assets are available for use; If the expected realization mode cannot be reliably determined,straight-line amortization method shall be adopted.
Amortization method, service life, determination basis and residual rate of various intangible assets withlimited service life:
| Category | Amortization method | Service life (year) | Determination basis | Residual rate (%) |
| Land use right | Straight-line method | 40-50 years | Statutory term/registration term of land use certificate | |
| Trademark right | Straight-line method | 10 years | Statutory term | |
| Software | Straight-line method | 2-10 years | Benefit period/contract period |
| Patent | Straight-line method | 5-10 years | Benefit period/contract period | |
| Non-patent technology | Straight-line method | 5-10 years | Benefit period/contract period | |
| Industrial property rights and proprietary technology | Straight-line method | 10 years | Benefit period/contract period | |
| Others | Straight-line method | 5-10 years | Benefit period/contract period |
At the end of each year, the Company reviews the service life and amortization method of intangibleassets with limited service life. If the service life and amortization method of intangible assets are different fromthose previously estimated, the amortization period and amortization method shall be changed.
The Company regards intangible assets with unpredictable future economic benefits as intangible assetswith uncertain service life, and does not amortize intangible assets with uncertain service life. The Companyreviews the service life of intangible assets with uncertain service life in each accounting period. If there isevidence that the service life of intangible assets is limited, its service life shall be estimate and treatment shallbe carried out according to the above provisions.
Please refer to Item (27) Impairment of Long-term Assets in this accounting policy for details on theimpairment test method and accrual method for impairment provision of intangible assets.
(2) Collection scope of R&D expenditure and related accounting treatment methods
R&D expenditure is directly related to R&D activities of the enterprise, including R&D employeecompensation, direct input expenses, depreciation expenses and long-term deferred expenses, design expenses,equipment debugging expenses, intangible assets amortization expenses, commissioned external R&D expenses,and other expenses. The collection and calculation of R&D expenditure is based on the fact that relevantresources are actually invested in R&D activities. R&D expenditure includes expensed R&D expenditure andcapitalized development expenditure.
The division standard of research stage expenditure and development stage expenditure of R&D projects:
Research stage expenditure refers to the expenditure incurred by original planned investigation for acquiringand understanding new scientific or technical knowledge; Development stage expenditure refers to theexpenditure incurred by applying research results or other knowledge to a plan or design to produce new orsubstantially improved materials, devices and products before commercial production or use.
Expenditures of intangible assets developed by the Company itself during the research stage of R&Dprojects are included in the current profits and losses when incurred. Expenditure in the development stage ofthe development project can only be recognized as intangible assets if the following conditions are met at thesame time:
(1) It is technically feasible to complete the intangible assets so that they can be used or sold;
(2) It has the intention to complete the intangible assets and use or sell them;
(3) For the ways in which intangible assets generate economic benefits, including the ability to prove thatthe products produced by using the intangible assets exist in the market or the intangible assets themselves existin the market, if the intangible assets will be used internally, their usefulness shall be proved;
(4) It has sufficient technical, financial and other resources to support the development of the intangibleassets, and has the ability to use or sell the intangible assets;
(5) Expenditure attributable to the development stage of the intangible assets can be reliably measured.
The expenditure in the development stage that has been expensed in the previous period is no longeradjusted.
30. Impairment of long-term assets
Long-term assets such as long-term equity investment, investment real estate measured by cost model,fixed assets, construction in progress, intangible assets and right-to-use assets, which show signs of impairmenton the balance sheet date, shall be tested for impairment. If the impairment test results show that the recoverableamount of the asset is lower than its book value, the impairment provision shall be accrued according to thedifference and included in the impairment loss. The recoverable amount is the higher of the net amount of theasset fair value after deducting the disposal expenses and the present value of the expected future cash flow ofthe asset. The asset impairment provision is calculated and recognized on the basis of individual assets. If it isdifficult to estimate the recoverable amount of individual assets, the recoverable amount of the asset group shallbe determined by the asset group to which the asset belongs. Asset group is the smallest asset portfolio that cangenerate cash inflow independently.
Goodwill shall be tested for impairment at least at the end of each year. The Company conducts goodwillimpairment test, and the book value of goodwill formed by business merger is allocated to relevant asset groupsaccording to reasonable methods from the date of purchase; If it is difficult to allocate to the relevant assetgroup, allocate it to the relevant asset group portfolio. When allocating the book value of goodwill to therelevant asset group or asset group portfolio, it shall be allocated according to the proportion of the fair value ofeach asset group or asset group portfolio to the total fair value of the relevant asset group or asset groupportfolio. If it is difficult to reliably measure the fair value, it shall be apportioned according to the proportion ofthe book value of each asset group or asset group portfolio to the total book value of the relevant asset group orasset group portfolio. When carrying out impairment test on relevant asset groups or asset group portfoliocontaining goodwill, if there are signs of impairment on asset groups or asset group portfolio related to goodwill,first carry out impairment test on asset groups or asset group portfolio that do not contain goodwill, calculatethe recoverable amount, and compare it with the relevant book value to recognize the corresponding impairmentloss. Then carry out impairment test on the asset group or asset group portfolio containing goodwill, andcompare the book value of these relevant asset groups or asset group portfolio (including the book value of the
allocated goodwill) with its recoverable amount. If the recoverable amount of the relevant asset group or assetgroup portfolio is lower than its book value, recognize the impairment loss of goodwill.Once the above-mentioned asset impairment losses are recognized, they will not be reversed in futureaccounting periods.
31. Long-term expenses to be apportioned
Long-term deferred expenses refer to the expenses that have been incurred by the Company but should beborne by the current period and subsequent periods with an amortization period of more than 1 year, includingthe improvement expenses of fixed assets rented by operating lease. Long-term deferred expenses shall beamortized evenly during the benefit period of relevant projects.
| Category | Amortization years |
| Decoration and maintenance fee | 3-6 years |
32. Contractual liability
Contractual liabilities reflect the Company's obligation to transfer goods to customers for received orreceivable consideration from customers. If the customer has paid the contract consideration or the Companyhas obtained the unconditional right to receive the contract consideration before the Company transfers thegoods to the customer, the contractual liabilities shall be recognized according to the amount received orreceivable when the customer actually issues the payment or the payment is due, whichever is earlier.
Contract assets and contractual liabilities under the same contract are listed on a net basis, and contractassets and contractual liabilities under different contracts are not offset.
33. Employee compensation
(1) Accounting treatment for short-term compensation
Short-term salary refers to the employee's salary that the Company needs to pay in full within 12 monthsafter the end of the annual report period when employees provide relevant services, except post-employmentbenefits and dismissal benefits. During the accounting period when employees provide services, the Companyrecognizes the actual short-term salary as a liability, and includes it into relevant asset costs and expensesaccording to the beneficiaries of employees' services.
(2) Accounting treatment for post-employment benefit
Post-employment benefits refer to various forms of remuneration and benefits provided by the Companyafter employees retire or terminate labor relations with the Company in order to obtain services provided byemployees, except short-term remuneration and dismissal benefits. Post-employment benefit plans includedefined contribution plan and defined benefit plans. Defined contribution plan refers to the post-employmentbenefit plan in which the Company will not undertake further payment obligations after paying a fixed fee for
an independent fund; Defined benefit plan refers to the post-employment benefit plan except the definedcontribution plan.
(1) Defined contribution plan
Defined contribution plan includes basic old-age insurance and unemployment insurance. During theaccounting period when employees provide services for the Company, the amount payable shall be calculatedaccording to the local payment base and proportion, recognized as liabilities, and included in the current profitsand losses or related asset costs.During the accounting period when employees provide services, the amount payable calculated accordingto the defined contribution plan is recognized as a liability and included in the current profits and losses orrelated asset costs.
(2) Defined benefit plan
According to the formula determined by the expected cumulative benefit unit method, the Companyattributes the benefit obligations generated by defined benefit plan to the period when employees providedservices, and includes them in the current profits and losses or related asset costs. The employee compensationcost caused by defined benefit plan of the Company includes the following components:
A. Service costs, including current service costs, past service costs and settlement gains or losses. Currentservice costs refer to the increase in the present value of defined benefit plan obligations caused by employees'provision of services in the current period; Past service costs refer to the increase or decrease of the presentvalue of defined benefit plan obligations related to employee service in the previous period caused by therevision of the defined benefit plan.
B. Net interest of net liabilities or net assets in defined benefit plan, including the interest income ofplanned assets, the interest expense of defined benefit plan obligations and the interest affected by the assetceiling.
C. Changes arising from re-measurement of net liabilities or net assets in defined benefit plan.
Unless other accounting standards require or allow employee benefit costs to be included in the asset costs,the Company will include the above items A and B in the current profits and losses, and include Item C in othercomprehensive income which will not be transferred back to profit or loss in subsequent accounting periods, butthese amounts recognized in other comprehensive income can be transferred within the scope of equity.
(3) Accounting for retirement benefits
Dismissal benefits refer to the compensation provided to employees by the Company for terminating thelabor relationship with employees before the expiration of their labor contracts or for encouraging employees tovoluntarily accept layoffs. If the Company provides dismissal benefits to employees, the employeecompensation liabilities arising from the dismissal benefits shall be recognized at the earlier of the followingtwo dates, and included in the current profits and losses: when the Company cannot unilaterally withdraw thedismissal benefits provided by the plan to terminate labor relations or the proposal to cut back; When the
Company recognizes the costs or expenses related to the reorganization involving the payment of dismissalbenefits.
(4) Accounting for other long-term employee benefits
Other long-term employee benefits refer to all employee compensation except short-term salary, post-employment benefits and dismissal benefits, including long-term paid absences, long-term disability benefitsand long-term profit sharing plans. Other long-term employee benefits provided by the Company to employees,if they meet the requirements of the defined contribution plan, shall be handled in accordance with the relevantprovisions of the defined contribution plan; For other long-term employee benefits other than the above, the netliabilities or net assets of other long-term employee benefits shall be recognized and measured according to therelevant regulations of the defined benefit plan. At the end of the reporting period, the Company attributed thebenefit obligations arising from other long-term employee benefits to the period when employees providedservices, and included them in the current profits and losses or related asset costs.
34. Accrual liability
If the Company's obligation related to contingencies meet the following conditions at the same time, itwill be recognized as a liability: (1) This obligation is the current obligation undertaken by the Company; (2)The performance of this obligation may lead to the outflow of economic benefits; (3) The amount of theobligation can be measured reliably.
All or part of the expenditures required for the estimated liabilities are expected to be compensated by thethird party or other parties, and the compensation amount is recognized as an asset separately when it isbasically determined that it can be received, and the recognized compensation amount does not exceed the bookvalue of the recognized liabilities. The estimated liabilities are initially measured according to the best estimateof the expenditure required to perform the relevant current obligations, with the factors related to contingencies,such as risks, uncertainties and time value of money, comprehensively considered. If the time value of moneyhas a significant impact, the best estimate shall be determined by discounting the relevant future cash outflows.
On the balance sheet date, the Company reviews the book value of the estimated liabilities. If there isconclusive evidence that the book value cannot truly reflect the current best estimate, such book value will beadjusted according to the current best estimate.
35. Share-based payment
1. Types of share-based payment
Share-based payment of the Company is divided into cash-settled share-based payment and equity-settledshare-based payment.
Equity-settled share-based payment shall be measured at the fair value of equity instruments granted toemployees. If it is exercisable immediately after the grant, it will be included in the relevant costs or expensesaccording to the fair value of the equity instrument on the grant date, and the capital reserve will be increasedaccordingly. If it is exercisable only after the service within the waiting period is completed or the specifiedperformance conditions are met, on each balance sheet date within the waiting period, the service obtained inthe current period shall be included in the relevant costs or expenses and capital reserve based on the bestestimate of the number of exercisable equity instruments and according to the fair value on the grant date of theequity instruments. After the vesting date, the recognized related costs or expenses and the total owners' equitywill not be adjusted.Cash-settled share-based payment shall be measured at fair value of liabilities calculated and determinedbased on shares or other equity instruments undertaken by the Company. If it is exercisable immediately afterthe grant, it will be included in the relevant costs or expenses at the fair value of the liabilities undertaken by theCompany on the grant date, and the liabilities will be increased accordingly. For cash-settled share-basedpayment exercisable after the service in the waiting period is completed or the specified performance conditionsare met, the service obtained in the current period shall be included in the costs or expenses and correspondingliabilities on each balance sheet date during the waiting period based on the best estimate of the vestingsituation and according to the fair value of the liabilities undertaken by the Company. On each balance sheetdate and settlement date before the settlement of related liabilities, the fair value of liabilities is re-measured,and its changes are included in the current profits and losses.
2. Accounting treatment related to implementation, modification and termination of share-based paymentplan
No matter how the terms and conditions of the granted equity instruments are modified, or even the grantof the equity instruments is cancelled or the equity instruments are settled, the Company shall at least recognizethat the corresponding services obtained are measured according to the fair value of the granted equityinstruments on the grant date, unless the vesting conditions of the equity instruments (except market conditions)cannot be met.
If the Company cancels the granted equity instruments or settles the granted equity instruments within thewaiting period (except those cancelled due to failure to meet the conditions of vesting conditions), the treatmentis as follows:
(1) The cancellation or settlement will be treated as accelerated vesting, and the amount that should havebeen recognized in the remaining waiting period will be recognized immediately.
(2) All the money paid to employees at the time of cancellation or settlement shall be treated as therepurchase of equity, and the part paid for repurchase that is higher than the fair value of the equity instrumenton the repurchase date shall be included in the current expenses.
(3) If a new equity instrument is granted to employees, and it is determined that the new equityinstrument granted is used to replace the cancelled equity instrument on the grant date of the new equityinstrument, the Company shall handle the granted alternative equity instrument in the same way as themodification of the terms and conditions of the original equity instrument.
36. Other financial instruments including preferred stock and perpetual bonds
Nil
37. Revenue
Disclosure of accounting policies adopted in income recognition and measurement according to business types
The Company has fulfilled its contractual obligations, that is, to recognize the income when the customerobtains the control right of relevant goods. Performance obligation refers to the commitment to transfer clearlydistinguishable goods to customers in the contract. The Company evaluates the contract on the contract startdate to identify each individual performance obligation contained in the contract. If the following conditions aremet at the same time, it is clearly distinguishable goods:
(1) Customers can benefit from the goods itself or from the use of the goods along with other easilyavailable resources;
(2) The commitment to transfer the goods to customers can be distinguished separately from othercommitments in the contract.
The following situations usually indicate that the commitment to transfer the goods to customers cannotbe distinguished separately from other commitments in the contract:
(1) Significant services need to be provided to integrate the goods and other goods promised in thecontract into the combined output agreed in the contract and transfer it to customers;
(2) The goods will make major modifications or customizations to other goods promised in the contract;
(3) The goods are highly correlated with other goods promised in the contract.
The transaction price is the amount of consideration that the Company is expected to receive fortransferring the goods to customers, excluding the payment collected on behalf of third parties and the paymentthat the Company is expected to return to customers. When determining the transaction price of the contract, ifthere is a variable consideration, the Company will determine the best estimate of the variable considerationaccording to the expected value or the most likely amount, and include it in the transaction price at an amountnot exceeding the amount that is unlikely to be significantly reversed when the relevant uncertainty iseliminated. If there is a significant financing component in the contract, the Company will determine thetransaction price according to the amount payable in cash when the customer obtains the goods control right,and the difference between the transaction price and the contract consideration will be amortized by the
effective interest rate method during the contract period. If the interval between the customer obtaining thegoods control right and the customer paying the price is less than one year, the Company will not consider thefinancing component. When the consideration that the Company has the right to collect from the customer dueto the transfer of goods is in the form of non-cash, the Company will determine the transaction price accordingto the fair value of the non-cash consideration on the contract start date. If the fair value of the non-cashconsideration cannot be reasonably estimated, the Company will indirectly determine the transaction price withreference to the individual selling price of the goods it promised to transfer to customers. For the payment thatthe Company expects to return to customers, except for obtaining other clearly distinguishable goods fromcustomers, the consideration payable shall be used to offset the transaction price. If the consideration payable tocustomers exceeds the fair value of clearly distinguishable goods obtained from customers, the excess amountshall be used as the consideration payable to customers to offset the transaction price. If the fair value of clearlydistinguishable goods obtained from customers cannot be reasonably estimated, the Company will fully offsetthe transaction price from the consideration payable to customers. When carrying out accounting treatment onthe transaction price offset by the consideration payable to customers, the Company will offset the currentincome at the later time of recognizing the relevant income and paying (or promising to pay) the customerconsideration.If the contract contains two or more performance obligations, the Company will allocate the transactionprice to each individual performance obligation according to the relative proportion of the individual sellingprice of the goods promised by each individual performance obligation on the contract start date, and measurethe income according to the transaction price allocated to each individual performance obligation. In case ofsubsequent changes in the transaction price, the Company will allocate the subsequent changes to theperformance obligations in the contract according to the basis adopted on the contract start date. The transactionprice will not be re-allocated due to the change of individual selling price after the contract start date.
If any of the following conditions is met, the Company will perform its obligations within a certain periodof time; Otherwise, it is a fulfillment of performance obligation at a certain time point:
(1) Customers gain and consume the economic benefits brought by the Company's performance at thesame time;
(2) Customers can control the goods under construction during the performance of the Company;
(3) The goods produced during the performance of the Company have irreplaceable uses, and theCompany has the right to collect payment for the accumulated part of the performance completed so far duringthe whole contract period.
For the performance obligations performed in a certain period of time, the Company shall recognize theincome according to the performance progress during that period, except that the performance progress cannotbe reasonably determined. The Company determines the performance progress of provided services accordingto the input method. When the performance progress cannot be reasonably recognized, if the cost already
incurred by the Company is expected to be compensated, the revenue will be recognized according to the costamount already incurred until the performance progress can be reasonably recognized.
For the performance obligations fulfilled at a certain time point, the Company recognizes the incomewhen the customer obtains the control right of relevant goods. When judging whether the customer has obtainedthe control of the goods, the Company will consider the following signs:
(1) The Company is entitled to the right of real time payment collection for the goods, that is, thecustomer has the real time payment collection obligation for the goods;
(2) The Company has transferred the legal ownership of the goods to the customer, that is, the customerhas the legal ownership of the goods;
(3) The Company has transferred the goods in kind to the customer, that is, the customer has occupied thegoods in kind;
(4) The Company has transferred the main risks and rewards on the ownership of the goods to thecustomer, that is, the customer has obtained the main risks and rewards on the ownership of the goods;
(5) The customer has accepted the goods.
According to whether the Company has control over the goods or services before transferring them tocustomers, the Company judges whether it is the main responsible person or the agent when engaging intransactions. If the Company can control the goods or services before transferring them to customers, theCompany is the main responsible person, and the income is recognized according to the total considerationreceived or receivable; Otherwise, the Company is an agent, and will recognize the income according to theexpected amount of commission or handling fee, which is determined according to the net amount of the totalconsideration received or receivable after deducting the price payable to other interested parties, or according tothe established commission amount or proportion.
The situations in which the Company can control the goods before transferring them to customers includethe following:
(1) The enterprise transfers the control right of goods or other assets to the customer after it obtains it froma third party;
(2) The enterprise can lead the third party to provide services to customers on behalf of the enterprise;
(3) After the enterprise obtains the control right of the goods from the third party, it integrates the goodswith other goods into a combined output and transfers it to the customer by providing significant services.
When judging whether it has control over the goods before transferring them to customers, the Companycomprehensively considers all relevant facts and circumstances, including:
(1) The enterprise bears the main responsibility for transferring goods to customers;
(2) The enterprise bears the inventory risk of the goods before or after their transfer;
(3) The enterprise has the right to decide the prices of the goods for trade independently;
(4) Other relevant facts and circumstances.
Different income recognition methods and measurement methods involved in different business models adoptedby similar businessesThe Company's commodity sales mainly include circulation sales, shopping mall joint operation andproprietary e-commerce, and the recognition methods of sales revenuethese three ways are as follows:
(1) Circulation sales refers to that the Company recognizes the sales revenue when the goods are deliveredto the customer and the authorized representative or the first carrier recognized by the customer at thedesignated place, and the customer and the authorized representative or the first carrier have signed for it, andthe Company has received the payment or obtained delivery documents.
(2) The shopping mall joint operation is the Company cooperates with the shopping mall to carry out joint salesin the form of counters in the shopping mall, and according to the agreement signed with the shopping mall, theshopping mall collects the payment when the Company's counters sell goods to customers, and the Companyand the shopping mall carry out sales settlement. The shopping mall pays the Company after reconciling withthe Company at the agreed settlement time (generally the next month) and deducting the income and relatedexpenses enjoyed by the shopping mall. The Company recognizes the sales revenue after deducting thededuction profit belonging to the shopping mall according to the full amount of the completed transaction ofactual sales in the month.
(3) Proprietary e-commerce refers to that the Company retails through third-party e-commerce platforms(such as Tmall and JD.COM), and recognizes the sales revenue when the customer signs for the goods andobtains the payment or payment right.The Company shall comply with the disclosure requirement of jewelry-related industries in the “ShenzhenStock Exchange Self-Regulatory Guidelines for Listed Companies No. 3- Industry Disclosure”Nil
38.Contract cost
Contract costs include incremental costs incurred in obtaining contract and contract performance costs.
The incremental costs incurred to obtain the contract refer to the costs that the Company would not haveincurred if the contract had not been obtained (e.g., sales commission, etc.). If the cost is expected to berecovered, the Company recognizes it as an asset for the costs of acquiring the contract. Expenses incurred bythe Company in obtaining the contract, other than the incremental costs that are expected to be recovered, areincluded in profit or loss for the current period when incurred.
If the costs incurred for the performance of the contract are not subject to the scope of the relevantstandards such as inventory, fixed assets or intangible assets, and the following conditions are met at the sametime, the Company recognizes them as an asset for contract performance costs:
(1) the cost is directly related to a current or an anticipated contract, including direct labor, direct materials,manufacturing expenses (or similar expenses), costs expressly borne by the customer and other costsincurred solely as a result of the contract;
(2) the cost increases the resources that the enterprise will use to fulfill its performance obligations in thefuture;
(3) the cost is expected to be recovered.
The asset as recognized by the cost of acquiring the contract and the asset as recognized by the cost ofperformance of the contract are amortized on the same basis as the revenue recognition of the goods or servicesrelated to the assets, and are included in profit or loss for the current period.
If the carrying amount of an asset related to the contract cost is higher than the following two differences,the Company shall make an impairment provision for the excess and recognize it as an asset impairment loss:
(1) The residual consideration that the enterprise is expected to receive as a result of the transfer ofcommodities related to the asset;
(2) An estimate of the costs to be incurred for the transfer of the relevant goods.
If the factors of impairment in the previous period change subsequently, so that the difference by (1)minus (2) is higher than the carrying amount of the asset, the original provision for impairment of the asset shallbe reversed and included in the profit or loss for the current period, but the carrying amount of the reversedasset shall not exceed the carrying amount of the asset on the reversal date assuming that no provision forimpairment is made.
39. Government subsidies
1. Types of government subsidies
Government subsidies refer to the monetary assets or non-monetary assets obtained by the company fromthe government free of charge, including government subsidies related to assets and government subsidiesrelated to income.
Asset-related government subsidies refer to government subsidies obtained by a company for theacquisition, construction or other formation of long-term assets.
Income-related government subsidies refer to government subsidies other than asset-related governmentsubsidies.
2. The principle and timing of recognition of government subsidies
Recognition principle of government subsidies:
(1) The company is able to meet the conditions attached by the government subsidy;
(2) The company is able to receive government subsidies.
The government subsidy can only be recognized if the above conditions are met at the same time.
3. Measurement of government subsidies
(1) If the government subsidy is a monetary asset, the company shall measure it according to the amountreceived or receivable;
(2) If the government subsidy is a non-monetary asset, the company shall measure it at fair value, and ifthe fair value cannot be reliably obtained, it shall be measured at the notional amount (the notional amount isRMB 1).
4. Accounting treatment of government subsidies
(1) Asset-related government subsidies are written off the carrying amount of the underlying assets orrecognized as deferred income upon acquisition. If it is recognized as deferred income, it shall be included inprofit or loss in installments in accordance with a reasonable and systematic method during the useful life of therelevant asset. Government subsidies measured in notional amounts are directly included in profit or loss for thecurrent period.
(2) Government subsidies related to income shall be handled as follows:
A. If it is used to compensate the company for the relevant costs, expenses or losses in subsequent periods,it shall be recognized as deferred income at the time of acquisition, and shall be included in the profit or loss forthe current period or offset the relevant costs during the period when the relevant costs, expenses or losses arerecognized.
B. If it is used to compensate for the relevant costs, expenses or losses incurred by the company, it shall bedirectly included in the current profit or loss or offset the relevant costs when acquired.
(3) For government subsidies that are included in both the asset-related part and the income-related part, ifthey can be distinguished, they shall be accounted for separately in different parts, and if it is difficult todistinguish, they shall be classified as income-related government subsidies as a whole.
(4) Government subsidies related to the company's routine operations shall be included in other income oroffset related costs and expenses according to the economic business substance. Government subsidiesunrelated to the company's routine activities are included in non-operating income and expenditure. If thefinance department directly allocates the discount funds to the company, the company will offset the relevantborrowing costs with the corresponding discount.
(5) If the confirmed government subsidy needs to be returned, it shall be handled according to thefollowing circumstances:
A. If the carrying amount of the relevant asset is reduced at the time of initial recognition, the carryingamount of the asset shall be adjusted.B. If there is relevant deferred income, the carrying amount of the relevant deferred income shall be writtenoff, and the excess part shall be included in the profit or loss for the current period.C. If it belongs to other circumstances, it shall be directly included in the profit or loss for the current period.
40. Deferred tax assets/deferred tax liabilities
When the company acquires assets and liabilities, it determines its tax base. If there is a temporarydifference between the carrying amount of assets and liabilities and their tax base, the deferred tax assets ordeferred tax liabilities arising from them shall be recognized in accordance with the regulations.
1. Recognition of deferred tax assets
(1) The company recognizes deferred tax assets arising from deductible temporary differences to theextent that it is likely to obtain taxable income that can be used to offset deductible temporary differences.However, deferred tax assets arising from the initial recognition of assets or liabilities are not recognized intransactions that (1) is not a business combination, and (2) the transaction does not affect either accountingprofits or taxable income (or deductible losses) at the time of the transaction.
(2) The Company recognizes the corresponding deferred tax assets for deductible temporary differencesrelated to investments in subsidiaries, associates and joint ventures that meet the following conditions at thesame time: (1) the temporary differences are likely to be reversed in the foreseeable future, and (2) the taxableincome used to offset the deductible temporary differences is likely to be obtained in the future.
(3) For deductible losses and tax credits that can be carried forward to subsequent years in accordancewith the provisions of the tax law, they shall be treated as deductible temporary differences, and thecorresponding deferred tax assets shall be recognized to the extent that the future taxable income that is likely tobe used to offset the deductible losses and tax credits.
2. Recognition of deferred tax liabilities
(1) The company recognizes all deferred tax liabilities arising from taxable temporary differences, exceptfor the deferred income tax liabilities arising from the following transactions: (1) the initial recognition ofgoodwill, and (2) the initial recognition of assets or liabilities arising from transactions that satisfy both thefollowing characteristics: the transaction is not a business combination, and the transaction does not affect eitherthe accounting profit or the taxable income (or deductible loss) at the time of the transaction.
(2) The Company recognizes the corresponding deferred tax liabilities for taxable temporary differencesrelated to investments in subsidiaries, associates and joint ventures, but other than those with the followingconditions are met at the same time: (1) the investment enterprise can control the time for the reversal of thetemporary difference, and (2) the temporary difference is likely not to be reversed in the foreseeable future.
3. Presentation of net offsets of deferred tax assets and deferred tax liabilities
When the company has the legal right to settle on a net basis and intends to settle on a net basis or acquireassets and settle liabilities at the same time, the company's current income tax assets and current income taxliabilities are presented on a net basis after offset.
When there is a legal right to settle the current income tax assets and current income tax liabilities on a netbasis, and the deferred tax assets and deferred tax liabilities are related to the income tax levied by the same taxcollection and administration department on the same taxpayer or levied by the same tax collection andadministration department to different tax subjects, but in each period of reversal of deferred tax assets andliabilities of material nature in the future, the taxpayer involved intends to settle the current income tax assetsand liabilities on a net basis or acquire the assets and settle liabilities at the same time, the deferred tax assetsand deferred tax liabilities of the Company are presented on a net basis after offset.
41. Leasing
(1) Accounting treatment as a lessee lease
(1) Right-of-use assets
On the commencement date of the lease term, the Company, as the lessee, recognizes the right to use theleased asset during the lease term as right-of-use asset, except for short-term leases and leases of low-valueassets.
Right-of-use assets are initially measured at cost, which includes:
A. Initial measurement amount of the lease liability;
B. If there is a lease incentive for the lease payment paid on or before the start date of the lease term, therelevant amount of the lease incentive already enjoyed shall be deducted;
C. Initial direct costs incurred;
D. Costs expected to be incurred to dismantle and remove the leased asset, restore the site on which theleased asset is located, or restore the leased asset to the condition agreed in the lease terms, except for theproduction of inventory.
The Company adopts the cost model for the subsequent measurement of right-of-use assets, and adopts thestraight-line method for depreciation of various types of right-of-use assets.
If the Company is able to reasonably determine that the ownership of the leased assets will be acquired atthe expiration of the lease term, the depreciation shall be accrued during the remaining useful life of the leasedassets, and if it cannot be reasonably determined that the ownership of the leased assets can be acquired at theexpiration of the lease term, the depreciation shall be accrued during the period which is shorter from the leaseterm and the remaining useful life of the leased assets. If the right-of-use asset is impaired, the Company willcarry out subsequent depreciation based on the carrying amount of the right-of-use asset after deducting theimpairment loss.
When the Company remeasures lease liabilities based on the present value of the changed lease paymentsand adjusts the carrying amount of right-of-use assets accordingly, if the carrying amount of right-of-use assetshas been reduced to zero, but the lease liabilities still need to be further reduced, the remaining amount will beincluded in profit or loss for the current period.
The impairment test method and impairment provision method of right-of-use assets are detailed in(XXVII) Impairment of long-term assets of this accounting policy.
(2) Lease liabilities
At the commencement date of the lease term, the Company recognizes the present value of unpaid leasepayments as lease liabilities, excluding short-term leases and leases of low-value assets.
When calculating the present value of the lease payment, the Company, as the lessee, uses the interest rateimplicit in the lease as the discount rate, and if the interest rate implicit in the lease cannot be determined, theincremental borrowing rate of the Company is used as the discount rate.
The Company calculates the interest expense of lease liabilities for each period of the lease term at a fixedperiodic interest rate and includes them in profit or loss for the current period. Variable lease payments that arenot included in the measurement of lease liabilities are recognized in profit or loss for the current period whenthey are actually incurred.
After the commencement date of the lease term, the Company will remeasure the lease liability based onthe present value of the changed lease payment in the event of a change in the amount of the substantial fixed
payment, a change in the estimated amount payable for the residual value of the guarantee, a change in theindex or ratio used to determine the amount of the lease payment, a change in the evaluation result or actualexercise of the option to purchase, renew or terminate the option.
(3) Short-term leases and leases of low-value assets
A short-term lease is a lease with a lease period of not more than 12 months on the start date of the leaseterm and does not include an option to purchase. A lease of a low-value asset refers to a lease with a low valuewhen a single leased asset is a brand-new asset. If the Company subleases or expects to sublease the leasedassets, the original lease is not a low-value asset lease.The Company chooses not to recognize right-of-use assets and lease liabilities for short-term leases andleases of low-value assets, and to include the relevant lease payments in profit or loss or the cost of relatedassets on a straight-line basis for each period of the lease term.
（2） Accounting treatment as a lessor's lease
On the lease commencement date, the Company divides the lease into the finance lease and the operatinglease. A financial lease refers to a lease that substantially transfers almost all of the risks and rewards associatedwith the ownership of the leased asset, regardless of whether the ownership is ultimately transferred. Operatingleases refer to leases other than financial leases. When the Company acts as a subleaselessor, it classifies thesublease based on the right-of-use assets generated from the original lease.
(1) Accounting treatment of operating leases
Lease receipts from operating leases are recognized as rental income on a straight-line basis for eachperiod of the lease term. The Company capitalizes the initial direct expenses incurred in connection with theoperating lease and apportion them to profit or loss for the current period on the same basis as the rental incomerecognition during the lease term. Variable lease payments that are not included in lease receipts are recognizedin profit or loss for the current period when they are actually incurred.
(2) Accounting treatment of financial leases
On the lease commencement date, the Company recognizes the financial lease receivables for the financiallease and terminates the recognition of the financial lease assets. When the Company initially measures thefinancial lease receivables, the net lease investment is recorded as the entry value of the financial leasereceivables. The net lease investment is the sum of the unsecured residual value and the present value of leasereceipts not yet received at the start date of the lease term discounted at the interest rate implicit in the lease.
The Company calculates and recognizes interest income for each period of the lease term at a fixedperiodic interest rate. The derecognition and impairment of financial lease receivables are described in (Xl)Financial instruments of this accounting policy.
Variable lease payments that are not included in the net measurement of lease investments are recognizedin profit or loss for the period when they are actually incurred.
42. Other important accounting policy and estimation
Nil
43. Changes of important accounting policy and estimation
(1) Changes of important accounting policy
?Applicable □Not applicable
In RMB
| Content and reason of the accounting policy change | The name of the report item that is significantly affected | Affected amount |
| In November 2022, the Ministry of Finance issued the Interpretation No. 16 of Accounting Standards for Business Enterprises (No. 31[2022] Cai Kuai) (hereinafter referred to as "Interpretation No. 16"), in which the“Accounting treatment of deferred income tax related to assets and liabilities arising from a single transaction not applicable to the initial recognition exemption"will come into effect on January 1, 2023. The Company shall commence the implementation from the date of the regulation. | See other notes for details |
Other note：
On November 30, 2022, the Ministry of Finance issued Interpretation No. 16.The Company shall implementthe "Accounting treatment of deferred income tax related to assets and liabilities arising from a single transactionnot applicable to the initial recognition exemption" from January 1, 2023.
Interpretation No. 16 clarifies that for a single transaction that is not a business combination, thetransaction does not affect the accounting profit or the taxable income (or deductible loss) at the time of thetransaction, and the assets and liabilities initially recognized result in the same amount of taxable temporarydifferences and deductible temporary differences, for the taxable temporary differences and deductibletemporary differences arising from the initial recognition of assets and liabilities, the corresponding deferred taxliabilities and deferred tax assets that are recognized separately when the transaction occursshall be inaccordance with Accounting Standard for Business Enterprises No. 18 - Income Tax and other relevantprovisions. The provisions will come into force on January 1, 2023, and for the above-mentioned transactionsthat occur from the beginning of the earliest period of the financial report presentation period and the effective
date of this interpretation for the first time of implementation of above-said regulation, the Company shalladjust the cumulative impact to the opening retained earnings and other relevant financial statement itemspresented for the earliest period of the financial report.
The adoption of Interpretation No. 16 by the Company does not have a material impact on the Company'sfinancial condition and operating results.
(2) Changes of important accounting estimation
□Applicable ?Not applicable
（3） The Company started implementing the updated accounting standards commencing from 2023and adjusted the relevant items in the financial statements at the beginning of the very year involved inthe initial implementation of the said standards
□Applicable ?Not applicable
44.Other
NilVI. Taxes
1. Main tax and tax rate
| Type of tax | Tax calculation evidence | Tax rate |
| Value added tax | Sales of goods, taxable labor service revenue, taxable income, intangible assets income and income from property leasing | 5%,6%,9%,13% |
| City maintenance & construction tax | VAT payable | 7% |
| Enterprise income tax | Taxable income | See below for details |
| Education Fee Surcharge | VAT payable | 3% |
| Local education fee surcharge | VAT payable | 2% |
Disclose reasons for different taxpaying body
| Taxpaying body | Income tax rate |
| Shenzhen China Bicycle Company (Holdings) Co., Ltd. | 25% |
| Shenzhen Xinsen Jewelry Gold Supply Chain Co., Ltd | 25% |
| Shenzhen Xinsen Precision Manufacturing Co.,Ltd. | 20% |
| Shenzhen Emmelle Industrial Co., Ltd. | 20% |
| Shenzhen Emmelle Cloud Technology Co., Ltd. | 20% |
| Fujian Huaxinbao Jewelry Co., Ltd. | 20% |
| Shenzhen Huabao Zhenxuan Jewelry Co., Ltd. | 20% |
| Hainan Shenhua Industry Co., Ltd. | 20% |
2. Tax preference
The subsidiaries Shenzhen Xinsen Precision Manufacturing Co., Ltd., Shenzhen Emmelle Industrial Co., Ltd.,Shenzhen Emmelle Cloud Technology Co., Ltd., Fujian Huaxinbao Jewelry Co., Ltd., Shenzhen HuabaoSelection Jewelry Co., Ltd., and Hainan Shenhua Industrial Co., Ltd. meet the conditions of "small and low-
profit enterprises", and according to the regulations of No. 12[2023] announcement of the State Administrationof Taxation of the Ministry of Finance "Announcement on Further Supporting the Development of Small andMicro Enterprises and Individual Industrial and Commercial Households", for small enterprises with smallprofit, the income tax policy for the taxable income will be reduced to be 25% to calculateand the enterpriseincome tax paid at the rate of 20% will be extended until December 31,2027.
3.Other
Nil
VII. Notes to Items in the Consolidated Financial Statements
1. Monetary fund
In RMB
| Item | Ending balance | Opening balance |
| Cash on hand | 13,955.25 | 33,531.25 |
| Bank deposit | 54,134,719.15 | 50,889,338.10 |
| Other monetary fund | 3,776,621.83 | |
| Total | 54,148,674.40 | 54,699,491.18 |
Other note：
The other monetary funds in the opening balance of RMB 3,776,621.83 are frozen funds in litigation.
2. Trading financial assets
In RMB
| Item | Ending balance | Opening balance |
| Including: | ||
| Including: |
Other note：
Nil
3. Derivative financial assets
In RMB
| Item | Ending balance | Opening balance |
| N/A |
Other note：
Nil
4. Note receivable
(1) Category
In RMB
| Item | Ending balance | Opening balance |
| Bank acceptance notes | 1,102,000.00 | |
| Total | 1,102,000.00 |
（2） According to the bad debt provision method classification disclosure
In RMB
| Category | Ending balance | Opening balance | ||||||||
| Book balance | Bad debt provision | Book value Ratio | Book balance | Bad debt provision | Book value | |||||
| Amount | Ratio | Amount | Ratio | Amount | Ratio | Amount | Ratio | |||
| Including: | ||||||||||
| Including: | ||||||||||
If the provision for bad debts of notes receivable is made in accordance with the general model of expectedcredit losses, please refer to the disclosure of other account receivable to disclose related information about bad-debt provisions:
□Applicable ?Not applicable
(3) Bad debt provision accrual, collected or reversal in the period
Accrual of bad debt provision in the period:
In RMB
| Category | Opening balance | Current changes | Ending balance | |||
| Accrual | Collected or reversal | Write off | Other | |||
Including important amount of bad debt provision collected or reversal in the period:
□Applicable ?Not applicable
(4) Note receivable pledged at period-end
In RMB
| Item | Amount pledged at period-end |
(5) Note receivable which have endorsed and discount at period-end and has not expired on balance sheetdate
In RMB
| Item | Amount derecognition at period-end | Amount not derecognition at period-end |
(6) Note receivable actually written-off in the period
In RMB
| Item | Amount written off |
Including important note receivable written-off:
In RMB
| Enterprise | Nature | Amount written off | Causes | Procedure | Amount cause by related transactions or not (Y/N) |
Explanation on note receivable written-off:
Nil
5. Account receivable
(1)Category
（1）Disclosure according to the aging of accountBy account age
In RMB
| Aging | Balance in year-end | Balance Year-beginning |
| Within one year(one year included) | 193,373,233.68 | 256,831,667.42 |
| 1-2 years | 13,036,723.35 | 11,005,264.71 |
| 2-3 years | 10,764,196.13 | 2,070,170.90 |
| Over 3 years | 4,153,455.77 | 2,416,645.92 |
| 3-4 years | 1,812,809.85 | 1,016,132.00 |
| 4-5 years | 966,132.00 | 642,462.42 |
| Over 5 years | 1,374,513.92 | 758,051.50 |
| Total | 221,327,608.93 | 272,323,748.95 |
（2） According to the bad debt provision method classification disclosure
In RMB
| Category | Amount in year-end | Balance Year-beginning | ||||||||
| Book Balance | Bad debt provision | Book value | Book Balance | Bad debt provision | Book value | |||||
| Amount | Proportion(%) | Amount | Proportion(%) | Amount | Proportion(%) | Amount | Proportion(%) | |||
| Accrual of bad debt provision by single | 26,538,839.97 | 11.99% | 23,902,000.33 | 90.06% | 2,636,839.64 | 26,197,973.35 | 9.62% | 21,516,069.69 | 82.13% | 4,681,903.66 |
| Including： | ||||||||||
| Single identification | 26,538,839.97 | 11.99% | 23,902,000.33 | 90.06% | 2,636,839.64 | 26,197,973.35 | 9.62% | 21,516,069.69 | 82.13% | 4,681,903.66 |
| Accrual of bad debt | 194,788,768.96 | 88.01% | 1,132,475.60 | 0.58% | 193,656,293.36 | 246,125,775.60 | 90.38% | 738,377.33 | 0.30% | 245,387,398.27 |
| provision by portfolio | ||||||||||
| Including： | ||||||||||
| Aging portfolio | 194,788,768.96 | 88.01% | 1,132,475.60 | 0.58% | 193,656,293.36 | 246,125,775.60 | 90.38% | 738,377.33 | 0.30% | 245,387,398.27 |
| Total | 221,327,608.93 | 100.00% | 25,034,475.93 | 11.31% | 196,293,133.00 | 272,323,748.95 | 100.00% | 22,254,447.02 | 8.17% | 250,069,301.93 |
Bad debt provision accrual on single basis: Single identification
In RMB
| Name | Opening balance | Ending balance | ||||
| Book balance | Bad debt provision | Book balance | Bad debt provision | Accrual ratio | Reason for accrual | |
| Guangshui Jiaxu Energy Technology Co., Ltd. | 21,862,832.43 | 17,490,265.94 | 22,019,832.63 | 19,817,849.37 | 90.00% | Expected to be difficult to recover |
| Suzhou Daming Vehicle Industry Co., Ltd. | 944,014.42 | 755,211.54 | 915,394.42 | 732,315.54 | 80.00% | Expected to be difficult to recover |
| Suzhou Jiaxin Economic Trade Co., Ltd. | 888,757.00 | 888,757.00 | 888,757.00 | 888,757.00 | 100.00% | Expected to be difficult to recover |
| Dongguan Daxiang New Energy Co., Ltd. | 676,734.00 | 676,734.00 | 626,734.00 | 626,734.00 | 100.00% | Expected to be difficult to recover |
| Ningbo Fanxing New Energy Technology Co., Ltd. | 503,555.00 | 251,777.50 | 50.00% | Prepare for litigation and demand for collection | ||
| Shijiazhuang Dasong Tech. Co., Ltd | 497,064.00 | 497,064.00 | 497,064.00 | 497,064.00 | 100.00% | Expected to be difficult to recover |
| Guangdong Xinlingjia New Energy Co., Ltd. | 348,136.00 | 348,136.00 | 348,136.00 | 348,136.00 | 100.00% | Expected to be difficult to recover |
| Shanghai Swen Electric Vehicle Co., Ltd. | 280,197.50 | 280,197.50 | 280,197.50 | 280,197.50 | 100.00% | Expected to be difficult to recover |
| Other | 194,525.00 | 194,525.00 | 194,525.00 | 194,525.00 | 100.00% | Expected to be difficult to recover |
| Fuzhou Dayang Commercial Co., Ltd. | 147,804.28 | 147,804.28 | 147,804.28 | 147,804.28 | 100.00% | There are disputes that are difficult to recover |
| Tianjin Huiju Electric Vehicle Co., Ltd. | 116,840.14 | 116,840.14 | 116,840.14 | 116,840.14 | 100.00% | Expected to be difficult to recover |
| Hubei Topsdun | 241,068.58 | 120,534.29 | ||||
| Eletronic Tech. Co., Ltd. | ||||||
| Total | 26,197,973.35 | 21,516,069.69 | 26,538,839.97 | 23,902,000.33 |
Bad debt provision accrual on portfolio: Aging portfolio
In RMB
| Name of the Company | Ending balance | ||
| Book balance | Bad debt provision | Accrual ratio | |
| Within 1 year | 193,216,233.48 | 579,648.70 | 0.30% |
| 1-2 years | 1,021,052.80 | 3,063.16 | 0.30% |
| 2-3 years | 1,724.11 | 5.17 | 0.30% |
| 3-4 years | 549,758.57 | 549,758.57 | 100.00% |
| Total | 194,788,768.96 | 1,132,475.60 | |
Explanation on portfolio basis:
NilIf the provision for bad debts of account receivable is made in accordance with the general model of expectedcredit losses, please refer to the disclosure of other account receivable to disclose related information about bad-debt provisions:
□Applicable?Not applicable
(3) Bad debt provision accrual, collected or reversal in the period
Accrual of bad debt provision in the period:
In RMB
| Category | Opening balance | Current changes | Ending balance | |||
| Accrual | Collected or reversal | Write off | Other | |||
| Accounts receivable with individual provision for bad debts | 21,516,069.69 | 2,579,360.93 | 193,430.29 | 23,902,000.33 | ||
| Provision for bad debts based on a portfolio of credit risk characteristics | 738,377.33 | 475,017.85 | 80,919.58 | 1,132,475.60 | ||
| Total | 22,254,447.02 | 3,054,378.78 | 274,349.87 | 25,034,475.93 | ||
Including important amount of bad debt provision collected or reversal in the period:
In RMB
| Name of the organization | Amount recovered or reversed | Reason for reversal | Recovery method | The basis and rationality for determining the provision ratio of original bad debt provision |
Nil
(4) Account receivables actually write-off during the reporting period
In RMB
| Item | Amount written off |
Including major account receivables write-off:
In RMB
| Enterprise | Nature | Amount written off | Causes | Procedure | Amount cause by related transactions or not (Y/N) |
Explanation on account receivable write-off:
Nil
（5）The top five accounts receivable and contract assets at the end of the period aggregated accordingto debtor
In RMB
| Name of the organization | Ending balance of accounts receivable | Ending balance of contract assets | Ending balance of accounts receivable and contract assets | Proportion to the total ending balance of accounts receivable and contract assets | Ending balance of accounts receivable bad debt provision and contract asset impairment provision |
| Fuzhou Rongrun Jewelry Co., Ltd | 41,857,170.03 | 0.00 | 41,857,170.03 | 18.91% | 125,571.51 |
| Shenzhen Yunshang Jewelry Co., Ltd | 34,804,104.88 | 0.00 | 34,804,104.88 | 15.73% | 104,412.31 |
| Shenzhen Hualinglong Jewelry Culture Technology Co., Ltd | 32,948,292.58 | 0.00 | 32,948,292.58 | 14.89% | 98,844.88 |
| GuangshuiJiaxu Energy Technology Co., Ltd | 22,019,832.63 | 0.00 | 22,019,832.63 | 9.95% | 19,817,849.37 |
| Fuzhou Cangshan District Dingjue Jewelry Company | 20,357,882.20 | 0.00 | 20,357,882.20 | 9.20% | 61,073.65 |
| Total | 151,987,282.32 | 0.00 | 151,987,282.32 | 68.68% | 20,207,751.72 |
6. Contract assets
(1) Information of contract assets
In RMB
| Item | Ending balance | Opening balance | ||||
| Book balance | Bad debt | Book value | Book balance | Bad debt | Book value | |
| provision | provision |
(2) The significant amount change in book value during the reporting period and its reason
In RMB
| Item | The amount of change | Reason for change |
（3） According to the bad debt provision method classification disclosure
In RMB
| Category | Amount in year-end | Balance Year-beginning | ||||||||
| Book Balance | Bad debt provision | Book value | Book Balance | Bad debt provision | Book value | |||||
| Amount | Proportion(%) | Amount | Proportion(%) | Amount | Proportion(%) | Amount | Proportion(%) | |||
| Inducing | ||||||||||
| Including | ||||||||||
Provision for bad debts is made according to the general model of expected credit losses
□Applicable ?Not applicable
(4) Bad debt provision accrual, collected or reversal in the period
In RMB
| Item | Accrual | Collected or reversal | Write off | Reason |
Thereinto, the important amount of bad debt provision recovered or reversed in the current period:
In RMB
| Name of the organization | Amount recovered or reversed | Reason for reversal | Recovery method | The basis and rationality for determining the provision ratio of original bad debt provision |
Other note：
（5） Contract assets actually written off in the current period
In RMB
| Item | Amount written off |
Including important Contract asset written-off:
In RMB
| Name | Nature of amount | Write-off amount | Reason for write-off | Write-off procedures for fulfillment | Whether the payment is generated by a related party transaction |
Write-off explanation:
Other note：
7. Receivable financing
（1） Classification of receivables financing
InRMB
| Item | Ending balance | Opening balance |
（2） According to the bad debt provision method classification disclosure
In RMB
| Category | Amount in year-end | Balance Year-beginning | ||||||||
| Book Balance | Bad debt provision | Book value | Book Balance | Bad debt provision | Book value | |||||
| Amount | Proportion(%) | Amount | Proportion(%) | Amount | Proportion(%) | Amount | Proportion(%) | |||
| Inducing | ||||||||||
| Including | ||||||||||
Provision for bad debts is made according to the general model of expected credit losses
In RMB
| Bad debt provision | Phase I | Phase II | Phase III | Total |
| Expected credit losses over next 12 months | Expected credit losses for the entire duration (without credit impairment occurred) | Expected credit losses for the entire duration (with credit impairment occurred) | ||
| January 1, 2023 balance in the current period |
The basis for the division of each stage and the proportion of bad debt provision
Explanation of the significant changes in the book balance of receivables financing with changes in lossprovisions in the current period:
（3） Bad debt provision accrual, collected or reversal in the period
In RMB
| Category | Opening balance | Current changes | Ending balance | |||
| Accrual | Collected or reversal | Write off | Other | |||
| Other account receivable Bad debt provision-1st stage | 413,388.55 | 59,830.83 | 473,219.38 | |||
Thereinto, the important amount of bad debt provision recovered or reversed in the current period:
In RMB
| Name of the organization | Amount recovered or reversed | Reason for reversal | Recovery method | The basis and rationality for determining the |
provision ratio oforiginal bad debt
provision
Other note：
（4）Financing of accounts receivable pledged by the Company at the end of the period
In RMB
| Item | Pledged amount at the end of the period |
（5）Financing of accounts receivable that have been endorsed or discounted by the Company at the endof the period and have not yet matured on the balance sheet date
In RMB
| Item | The amount of derecognition at the end of the period | The amount not derecognized at the end of the period |
（6） Financing situation of accounts receivable actually written off in this period
In RMB
| Item | Write-off amount |
The write off information of important accounts receivable financing thereinto
In RMB
| Name | Nature of amount | Write-off amount | Reason for write-off | Write-off procedures for fulfillment | Whether the payment is generated by a related party transaction |
Write-off explanation:
(7) Changes in accounts receivable financing and fair value changes in the current period
Nil
（8）Other note
Nil
8. Other account receivable
In RMB
| Item | Ending balance | Opening balance |
| Other account receivable | 12,868,327.03 | 438,477.82 |
| Total | 12,868,327.03 | 438,477.82 |
(1) Interest receivable
1) Category
In RMB
| Item | Ending balance | Opening balance |
2) Important overdue interest
In RMB
| Borrower | Ending balance | Overdue time | Overdue reason | Impairment (Y/N) and judgment basis |
Other note:
Nil
3) Accrual of bad debt provision
□Applicable ?Not applicable
4） Bad debt provision accrual, collected or reversal in the period
In RMB
| Category | Opening balance | Current changes | Ending balance | |||
| Accrual | Collected or reversal | Write off | Other | |||
Including important amount of bad debt provision collected or reversal in the period:
In RMB
| Name of the organization | Amount recovered or reversed | Reason for reversal | Recovery method | The basis and rationality for determining the provision ratio of original bad debt provision |
Other note：
Nil
5)Interest receivable actually written off in the current period
In RMB
| Item | Write-off amount |
Important Interest receivables write-offs thereinto
In RMB
| Name | Nature of amount | Write-off amount | Write-off reason | Write-off procedures for fulfillment | Whether the payment is generated by a related party transaction |
Note：
NilOther note：
Nil
(2) Dividend receivable
1) Category
In RMB
| Item (or the invested entity) | Ending balance | Opening balance |
2) Important dividend receivable with over one year aged
In RMB
| Item (or the invested entity) | Ending balance | Account age | Causes of failure for collection | Impairment (Y/N) and judgment basis |
3) Accrual of bad debt provision
□Applicable ?Not applicable
4） Bad debt provision accrual, collected or reversal in the period
In RMB
| Category | Opening balance | Current changes | Ending balance | |||
| Accrual | Collected or reversal | Write off | Other | |||
Including important amount of bad debt provision collected or reversal in the period:
In RMB
| Name of the organization | Amount recovered or reversed | Reason for reversal | Recovery method | The basis and rationality for determining the provision ratio of original bad debt provision |
Other note：
Nil
5) Dividends receivable actually written off in the current period
In RMB
| Item | Write-off amount |
Important dividend receivables write-offs thereinto
In RMB
| Name | Nature of amount | Write-off amount | Write-off reason | Write-off procedures for fulfillment | Whether the payment is generated by a related party transaction |
Note：
NilOther note：
Nil
(3) Account receivable
1) By nature
In RMB
| Nature | Ending book balance | Opening book balance |
| Performance compensation | 12,098,051.76 | |
| Deposit or margin | 461,321.30 | 504,107.88 |
| Personal loan of employees | 15,865.25 | 33,445.00 |
| Payment for equipment | 311,400.00 | 311,400.00 |
| Current account | 410,737.50 | |
| Other | 62,744.32 | |
| Total | 13,297,375.81 | 911,697.20 |
2）By account aging
In RMB
| Aging | Ending book balance | Opening book balance |
| Within one year(one year included) | 12,747,197.43 | 319,540.20 |
| 1-2 years | 123,447.38 | 11,600.00 |
| 2-3 years | 108,657.00 | |
| Over 3 years | 426,731.00 | 471,900.00 |
| 3-4 years | 15,831.00 | 60,000.00 |
| 4-5 years | 50,000.00 | |
| Over 5 years | 410,900.00 | 361,900.00 |
| Total | 13,297,375.81 | 911,697.20 |
3) Accrual of bad debt provision
?Applicable □Not applicableProvision for bad debts is made according to the general model of expected credit losses
| Bad debt provision | Phase I | Phase II | Phase III | Total |
| Expected credit losses over next 12 months | Expected credit losses for the entire duration (without credit impairment occurred) | Expected credit losses for the entire duration (with credit impairment occurred) | ||
| Balance on January 1, 2023 | 473,219.38 | 473,219.38 | ||
| January 1, 2023 balance in the current period | ||||
| --Transfer to the second stage | ||||
| -- Transfer to the third stage | ||||
| -- Reversal to the second stage | ||||
| -- Reversal to the first stage | ||||
| Provision in Current Year | 11,057.93 | 11,057.93 | ||
| Reversal in Current Year | 55,228.53 | 55,228.53 | ||
| Conversion in Current Year | ||||
| Write off in Current Year | ||||
| Other change | ||||
| Balance on December 31, 2023 | 429,048.78 | 429,048.78 |
4） Bad debt provision accrual, collected or reversal in the periodAccrual of bad debt provision in the period
In RMB
| Category | Opening balance | Current changes | Ending balance | |||
| Accrual | Collected or reversal | Write off | Other | |||
| Provision for bad debts according to the combination of credit risk | 473,219.38 | 11,057.93 | 55,228.53 | 429,048.78 | ||
| Total | 473,219.38 | 11,057.93 | 55,228.53 | 429,048.78 | ||
NilImportant amount of bad debt provision switch-back or collection in the period:
In RMB
| Name of the organization | Amount recovered or reversed | Reason for reversal | Recovery method | The basis and rationality for |
determining theprovision ratio oforiginal bad debtprovision
Nil5） Other account receivables actually write-off during the reporting period
In RMB
| Item | Amount written off |
Including major other account receivables write-off:
In RMB
| Enterprise | Other Nature | Amount written off | Causes | Procedure | Amount cause by related transactions or not (Y/N) |
Other Note on account receivable write-off:
Note：
Nil6） Top 5 other account receivable collected by arrears party at ending balance
In RMB
| Enterprise | Nature | Ending balance | Account age | Proportion in total other account receivables at period-end | Ending balance of bad bet provision |
| Wansheng Industry Holding（Shenzhen ）Co., Ltd. | Performance compensation | 12,098,051.76 | Within 1 year | 90.98% | |
| Shenzhen Luwei Mechatronic Equipment Co., Ltd | Payment for equipment | 300,000.00 | Over 5 years | 2.26% | 300,000.00 |
| Shenzhen Luohu Government Property Management Office | Margin or deposit | 161,349.10 | Within 1 year | 1.21% | 484.05 |
| Shenzhen Hualinglong Jewelry Culture Tech. Co., Ltd. | Current account | 113,790.40 | Within 1 year | 0.86% | 341.37 |
| Alipay (China) Network Technology Co., Ltd. customer reserve fund | Margin or deposit | 110,000.00 | Within 1 year/Over 5 years | 0.83% | 50,180.00 |
| Total | 12,783,191.26 | 96.14% | 351,005.42 |
7) Reported in other receivables due to centralized management of funds
In RMBOther note：
Nil
9. Accounts paid in advance
(1) Accounts paid in advance by ageing
In RMB
| Account age | Ending balance | Opening balance | ||
| Amount | Ratio | Amount | Ratio | |
| Within one year | 3,821,181.16 | 100.00% | 4,285,047.15 | 99.96% |
| 1-2 years | 1,888.00 | 0.04% | ||
| Total | 3,821,181.16 | 4,286,935.15 | ||
Explanation on un-settlement in time for advance payment with over one year account age and major amounts:
Nil
(2) Top 5 advance payment at ending balance by prepayment object
| Name | Ending balance | Ratio in total advance e payment(%) |
| Shenzhen Tielbo Co., Ltd. | 2,256,987.95 | 59.07 |
| Zhouliufu Jewelry Co., Ltd. | 1,061,060.54 | 27.77 |
| Shenzhen Yipingda Industry Development Co., Ltd. | 366,000.00 | 9.58 |
| Shenzhen Cuilu Gold Business | 86,354.08 | 2.26 |
| Shenzhen Craftsman Family Jewelry Co., Ltd. | 34,714.11 | 0.91 |
| Total | 3,805,116.68 | 99.59 |
Other note：
Nil
10. Inventory
Whether companies need to comply with the disclosure requirements of the real estate industryNo
(1) Category
In RMB
| Item | Ending balance | Opening balance | ||||
| Book balance | Provision for inventory depreciation or contract performance cost impairment provision | Book value | Book balance | Provision for inventory depreciation or contract performance cost impairment provision | Book value | |
| Raw materials | 42,904,972.44 | 172,966.47 | 42,732,005.97 | 22,911,015.69 | 22,911,015.69 | |
| Finished goods | 36,248,964.02 | 476,356.57 | 35,772,607.45 | 25,045,073.77 | 412,020.87 | 24,633,052.90 |
| Consigned processing materials | 3,411,425.72 | 3,411,425.72 | 662,798.22 | 662,798.22 | ||
| Total | 82,565,362.18 | 649,323.04 | 81,916,039.14 | 48,618,887.68 | 412,020.87 | 48,206,866.81 |
The Company shall comply with the disclosure requirement of jewelry-related industries in the “ShenzhenStock Exchange Self-Regulatory Guidelines for Listed Companies No. 3- Industry Disclosure”
(2) Provision for inventory depreciation or contract performance cost impairment provision
In RMB
| Item | Opening balance | Current increased | Current decreased | Ending balance | ||
| Accrual | Other | Switch back or charge-off | Other | |||
| Raw materials | 172,966.47 | 172,966.47 | ||||
| Finished goods | 412,020.87 | 221,243.97 | 156,908.27 | 476,356.57 | ||
| Total | 412,020.87 | 394,210.44 | 156,908.27 | 649,323.04 | ||
NilProvision for inventory price decline that is made on a portfolio basis
In RMB
| Portfolio Name | End of period | Beginning of period | ||||
| Ending balance | Provision for price decline | Proportion of provision for price decline | Opening balance | Provision for price decline | Proportion of provision for price decline | |
The standard for accruing the provision for inventory price decline by portfolioNil
(3) The explanation of the ending balance of the inventory contains the capitalized amount of borrowingcostsThe ending balance of inventories does not include the capitalized amount of borrowing costs
(4) Explanation of the amortization amount of contract performance costs for the current periodNil
11. Assets held for sale
In RMB
| Item | Ending book balance | Impairment provision | Ending book value | Fair value | Expected disposal expenses | Expected disposal time |
Other note:
Nil
12. Non-current asset due within one year
In RMB
| Item | Ending balance | Opening balance |
（1） Debt investment due within one year
□Applicable ?Not applicable
（2）Other Debt investment due within one year
□Applicable ?Not applicable
13. Other current assets
In RMB
| Item | Ending balance | Opening balance |
| Input tax to be deducted | 35,453,106.62 | |
| To be certified input tax | 208,524.06 | |
| Advance payment of enterprise income tax | 193,128.35 | |
| Tax amount to be received | 10,814,443.03 | |
| Total | 11,216,095.44 | 35,453,106.62 |
Other note：
Nil
14. Debt investment
（1）Debt investment
In RMB
| Item | Ending balance | Opening balance | ||||
| Book balance | Impairment provision | Book value | Book balance | Impairment provision | Book value | |
Changes in impairment provisions for debt investments in the current period
In RMB
| Item | Opening balance | Increase in thecurrent period | Decrease in the current period | Ending balance |
（2） Important debt investment
In RMB
| Debt investment | Ending balance | Opening balance | ||||||
| Face value | Coupon rate | Actual rate | Due date | Face value | Coupon rate | Actual rate | Due date | |
（3） Accrual of impairment provision
In RMB
| Bad debt provision | Phase I | Phase II | Phase III | Total |
| Expected credit losses over next 12 months | Expected credit losses for the entire duration (without credit impairment occurred) | Expected credit losses for the entire duration (with credit impairment occurred) | ||
| January 1, 2023 balance in the current period |
The basis for the division of each stage and the proportion of bad debt provisionNil
(4) Information of debt investment actually written off in the current period
In RMB
| Item | Write-off amount |
Information of write-off of important debt investments thereintoDebt Investment Write-off Explanation:
NILChange of book balance of loss provision with amount has major changes in the period
□Applicable ?Not applicable
Other note：
Nil
15. Other debt investment
（1）Other debt investment
In RMB
| Item | Opening | Accrued interest | Change of fair value | Ending | Cost | Cumulative changes of | Cumulative loss | Note |
| balance | in the period | balance | fair value | impairment recognized in other comprehensive income |
Important other debt investment
Changes in provision for impairment of other debt investments in the current period
In RMB
| Item | Opening balance | Increase in the current period | Decrease in the current period | Ending balance |
（2） Important debt investment
In RMB
| Debt investment | Ending balance | Opening balance | ||||||
| Face value | Coupon rate | Actual rate | Due date | Face value | Coupon rate | Actual rate | Due date | |
（3） Accrual of impairment provision
In RMB
| Bad debt provision | Phase I | Phase II | Phase III | Total |
| Expected credit losses over next 12 months | Expected credit losses for the entire duration (without credit impairment occurred) | Expected credit losses for the entire duration (with credit impairment occurred) | ||
| January 1, 2023 balance in the current period |
The basis for the division of each stage and the proportion of bad debt provisionNil
（4）Other debt investments actually written off during the period
In RMB
| Item | Write-off amount |
Other important debt investment write-offs thereintoExplanation for write-off of other debt investments:
NilChange of book balance of loss provision with amount has major changes in the period
□Applicable ?Not applicable
Other note：
Nil
16. Investment in other equity instrument
In RMB
| Item name | Ending balance | Opening balance | Gains recognized in other comprehensive income for the current period | Loss recognized in other comprehensive income for the current period | Accumulated gains recognized in other comprehensive income at the end of the current period | Accumulated losses recognized in other comprehensive income at the end of the current period | Dividend income recognized in the current period | Reason for designated in fair value measurement with changes recognized in other comprehensive income |
Derecognition incurred in the current period
In RMB
| Item name | Accumulated gains transferred to retained earnings | Accumulated losses transferred to retained earnings | Reason for derecognition |
Itemized disclosure of investments by non-trading equity instruments for the current period
In RMB
| Item name | Recognized dividend income | Accrued gains | Accrued losses | Amount of other comprehensive income transferred to retained earnings | Reason for designated in fair value measurement with changes recognized in other comprehensive income | Reason for other comprehensive income transferred to retained earnings |
Other note：
Nil
17. Long-term account receivable
(1) Long-term account receivable
In RMB
| Item | Ending balance | Opening balance | Discount rate interval | ||||
| Book balance | Bad debt provision | Book value | Book balance | Bad debt provision | Book value | ||
（2） According to the bad debt provision method classification disclosure
In RMB
| Category | Amount in year-end | Balance Year-beginning | ||||||||
| Book Balance | Bad debt provision | Book value | Book Balance | Bad debt provision | Book value | |||||
| Amount | Proportion(%) | Amount | Proportion(%) | Amount | Proportion(%) | Amount | Proportion(%) | |||
| Inducing | ||||||||||
| Including | ||||||||||
Provision for bad debts is made according to the general model of expected credit losses
In RMB
| Bad debt provision | Phase I | Phase II | Phase II | Total |
| Expected credit losses over next 12 months | Expected credit losses for the entire duration (without credit impairment occurred) | Expected credit losses for the entire duration (with credit impairment occurred) | ||
| January 1, 2023 balance in the current period |
The basis for the division of each stage and the proportion of bad debt provisionNil
(3) Bad debt provision accrual, collected or reversal in the period
In RMB
| Category | Opening balance | Current changes | Ending balance | |||
| Accrual | Collected or reversal | Write off | Other | |||
The important amount of bad debt provisions reversed or recovered in the current period thereinto:
In RMB
| Name of the organization | Amount recovered or reversed | Reason for reversal | Recovery method | The basis and rationality for determining the provision ratio of original bad debt provision |
Other note：
Nil
(4)Long-term receivables actually written off in the current period
In RMB
| Item | Write-off amount |
Important long-term accounts receivable write-off status thereinto:
In RMB
| Name of Organization | Amount Nature | Write-off amount | Write-off reason | Write-off procedures for fulfillment | Whether the payment is generated by a related party transaction |
Explanation of write-off of long-term receivables:
Nil
18. Long-term equity investment
In RMB
| The invested entity | Opening balance(Book value) | Changes in the period (+, -) | Ending balance(Book value) | Ending balance of impairment provision | |||||||
| Additional investment | Capital reduction | Investment gains recognized under equity | Other comprehensive income adjustment | Other equity change | Cash dividend or profit announced to issued | Accrual of impairment provision | Other | ||||
| I. Joint venture | |||||||||||
| II. Associated enterprise | |||||||||||
The recoverable amount is determined on the basis of the net amount of fair value less disposal costs
□Applicable ?Not applicable
The recoverable amount is determined by the present value of the projected future cash flows
□Applicable ?Not applicable
The reason for the obvious discrepancy between the foregoing information and the information used in theimpairment test of previous years or the external informationNilThe reason for the obvious discrepancy between the information used in the Company's impairment test inprevious years and the actual situation in the current yearNilOther note：
Nil
19. Other non-current financial assets
In RMB
| Item | Ending balance | Opening balance |
Other note：
Nil
20. Investment real estate
(1) Investment real estate measured at cost
□Applicable ?Not applicable
(2) Investment real estate measured at fair value
□Applicable ?Not applicable
(3) Converted to investment real estate and measured at fair value
In RMB
| Item | Accounting accounts before conversion | Amount | Reason for conversion | Approval procedures | Impact on profit and loss | Impact on other comprehensive income |
（4）Investment real estate without property rights certificate
In RMB
| Item | Book value | Reasons for failing to complete the property rights certificate |
Other note:
Nil
21.Fixed assets
In RMB
| Item | Ending balance | Opening balance |
| Fixed assets | 2,288,610.10 | 2,304,402.38 |
| Liquidation of fixed assets | ||
| Total | 2,288,610.10 | 2,304,402.38 |
（1） Fixed assets
In RMB
| Item | Houses and buildings | Machinery equipment | Means of transportation | Electronic equipment and others | Total |
| I. Original book value: | |||||
| 1.Opening balance | 2,959,824.00 | 1,209,295.35 | 958,593.21 | 299,852.09 | 5,427,564.65 |
| 2.Current increased | 101,551.64 | 75,832.97 | 177,384.61 | ||
| (1)Purchase | 101,551.64 | 75,832.97 | 177,384.61 | ||
| (2)Construction in progress transfer-in | |||||
| (3)The increase in business combination | |||||
| 3.Current decreased | 121,010.22 | 121,010.22 | |||
| (1) Disposal or scrap | 121,010.22 | 121,010.22 | |||
| 4.Ending balance | 2,959,824.00 | 1,310,846.99 | 958,593.21 | 254,674.84 | 5,483,939.04 |
| II. Accumulated depreciation | |||||
| 1.Opening balance | 865,748.52 | 429,520.61 | 862,386.24 | 235,901.15 | 2,393,556.52 |
| 2.Current increased | 133,192.08 | 22,993.38 | 24,692.49 | 180,877.95 | |
| (1)Accrual | 133,192.08 | 22,993.38 | 24,692.49 | 180,877.95 | |
| 3.Current decreased | 108,711.28 | 108,711.28 | |||
| (1) Disposal or scrap | 108,711.28 | 108,711.28 | |||
| 4.Ending balance | 998,940.60 | 452,513.99 | 862,386.24 | 151,882.36 | 2,465,723.19 |
| III. Impairment provision | |||||
| 1.Opening balance | 729,605.75 | 729,605.75 | |||
| 2.Current increased | |||||
| (1)Accrual | |||||
| 3.Current decreased | |||||
| (1) Disposal or scrap | |||||
| 4.Ending balance | 729,605.75 | 729,605.75 | |||
| IV. Book value |
| 1.Ending book value | 1,960,883.40 | 128,727.25 | 96,206.97 | 102,792.48 | 2,288,610.10 |
| 2.Opening book value | 2,094,075.48 | 50,168.99 | 96,206.97 | 63,950.94 | 2,304,402.38 |
(2) Fixed assets temporary idle
In RMB
| Item | Original book value | Accumulated depreciation | Impairment provision | Book value | Note |
| Machinery equipment | 1,044,247.81 | 314,642.06 | 729,605.75 | The lithium battery equipment stored in the GuangshuiJiaxu factory is in an idle state |
(3) Fixed assets leasing-out by operational lease
In RMB
| Item | Ending book value |
(4) Fixed assets without property rights certificate
In RMB
| Item | Book value | Reasons for failing to complete the property rights certificate |
| Six properties in Lianxin Garden | 1,960,883.40 | The six properties of Lianxin Garden 7-20F with original value of 2,959,824.00 Yuan. The property purchasing refers to the indemnificatory housing for enterprise talent buying from Shenzhen Housing and Construction Bureau of Luohu District. According to the agreement, the enterprise shall not carrying any kind of property trading with any units or individuals except the government, and the company has no property certification on the above mentioned properties. |
Other note：
Nil
(5) Information of impairment test of fixed assets
□Applicable ?Not applicable
（6） liquidation of fixed assets
In RMB
| Item | Ending balance | Opening balance |
Other note：
Nil
22. Construction in progress
In RMB
| Item | Ending balance | Opening balance |
（1）Construction in progress
In RMB
| Item | Ending balance | Opening balance | ||||
| Book balance | Impairment provision | Book value | Book balance | Impairment provision | Book value | |
（2） Changes in significant construction in progress
In RMB
| Item | Budget | Opening balance | Current increased | Fixed assets transfer-in in the Period | Other decreased in the Period | Ending balance | Proportion of project investment in budget | Progress | Accumulated amount of interest capitalization | including: interest capitalized amount of the year | Interest capitalization rate of the year | Source of funds |
(3) Provision for impairment of construction in progress in the current period
In RMB
| Item | Opening balance | Increase | Decrease | Ending balance | Reason |
Other note：
Nil
（4） Information of impairment test of construction in progress
□Applicable ?Not applicable
(5) Engineering materials
In RMB
| Item | Ending balance | Opening balance | ||||
| Book balance | Impairment provision | Book value | Book balance | Impairment provision | Book value | |
Other note:
Nil
23. Productive biological asset
(1) Productive biological assets measured by cost
□Applicable ?Not applicable
（2） Impairment test of productive biological assets using cost measurement mode
□Applicable ?Not applicable
（3） Productive biological assets measured by fair value
□Applicable?Not applicable
24. Oil and gas asset
□Applicable?Not applicable
25. Right-of-use assets
（1） Right-of-use assets
In RMB
| Item | Houses and buildings | Total |
| I. Original book value | ||
| 1.Opening balance | 2,955,726.43 | 2,955,726.43 |
| 2.Current increased | 2,564,145.65 | 2,564,145.65 |
| （1）lease | 2,564,145.65 | 2,564,145.65 |
| 3.Current decreased | 2,955,726.43 | 2,955,726.43 |
| （1）Dispose | 2,955,726.43 | 2,955,726.43 |
| 4.Ending balance | 2,564,145.65 | 2,564,145.65 |
| II. Accumulated depreciation | ||
| 1.Opening balance | 2,781,789.72 | 2,781,789.72 |
| 2.Current increased | 921,812.53 | 921,812.53 |
| (1)Accrual | 921,812.53 | 921,812.53 |
| 3.Current decreased | 2,955,726.43 | 2,955,726.43 |
| (1) Disposal | 2,955,726.43 | 2,955,726.43 |
| 4.Ending balance | 747,875.82 | 747,875.82 |
| III. Impairment provision | ||
| 1.Opening balance | ||
| 2.Current increased | ||
| (1)Accrual | ||
| 3.Current decreased | ||
| (1) Disposal | ||
| 4.Ending balance | ||
| IV. Book value | ||
| 1.Ending book value | 1,816,269.83 | 1,816,269.83 |
| 2.Opening book value | 173,936.71 | 173,936.71 |
（2） Information of impairment test of right-of-use assets
□Applicable ?Not applicable
Other note：
Nil
26. Intangible assets
(1) Intangible assets
In RMB
| Item | Land use right | Patent | Non-patent technology | Total | |
| I. Original book value | |||||
| 1.Opening balance | |||||
| 2.Current increased | |||||
| (1)Purchase | |||||
| (2) Internal R & D | |||||
| (3)The increase in business combination | |||||
| 3.Current decreased | |||||
| (1) Disposal | |||||
| 4.Ending balance | |||||
| II. Accumulated depreciation | |||||
| 1.Opening balance |
| 2.Current increased | |||||
| (1)Accrual | |||||
| 3.Current decreased | |||||
| (1) Disposal | |||||
| 4.Ending balance | |||||
| III. Impairment provision | |||||
| 1.Opening balance | |||||
| 2.Current increased | |||||
| (1)Accrual | |||||
| 3.Current decreased | |||||
| (1) Disposal | |||||
| 4.Ending balance | |||||
| IV. Book value | |||||
| 1.Ending book value | |||||
| 2.Opening book value |
Ratio of intangible assets resulted from internal R&D in balance of intangible assets at period-end
(2) Land use right without certificate of title completed
In RMB
| Item | Book value | Reasons for failing to complete the property rights certificate |
Other note：
Nil
（3）Information of impairment test of intangible assets
□Applicable ?Not applicable
27. Goodwill
(1) Original book value of goodwill
In RMB
| The invested entity or items | Opening balance | Current increased | Current decreased | Ending balance | ||
| Resulted by enterprise | Dispose | |||||
| combination | ||||||
| Total |
(2) Goodwill Impairment provision
In RMB
| The invested entity or items | Opening balance | Current increased | Current decreased | Ending balance | ||
| Accrual | Dispose | |||||
| Total | ||||||
(3) Information about the asset group or asset group portfolio to which the goodwill belongs
| Name | The composition and basis of the asset group or portfolio to which it belongs | Affiliated business segments and basis | Whether it is consistent with previous years |
Changes in the asset group or portfolio of asset groups
| Name | Composition before the change | Composition after the change | Objective facts and basis for change |
Other noteNil
(4) The specific method of determining the recoverable amount
The recoverable amount is determined on the basis of the net amount by fair value less disposal costs
□Applicable ?Not applicable
The recoverable amount is determined by the present value of the projected future cash flows
□Applicable ?Not applicable
The reason for the obvious discrepancy between the foregoing information and the information used in theimpairment test of previous years or the external informationNilThe reason for the obvious discrepancy between the information used in the Company's impairment test inprevious years and the actual situation in the current yearNil
(5) Status of completion of performance commitment and corresponding goodwill impairmentWhen goodwill is formed, there is a performance commitment and the reporting period or the previous period inthe reporting period is within the performance commitment period
□Applicable ?Not applicable
Other note：
Nil
29. Long-term expenses to be apportioned
In RMB
| Item | Opening balance | Current increased | Amortized in the Period | Other decrease | Ending balance |
Other note：
Nil
29. Deferred income tax asset /Deferred income tax liabilities
(1) Deferred income tax assets without offset
In RMB
| Item | Ending balance | Opening balance | ||
| Deductible temporary difference | Deferred income tax asset | Deductible temporary difference | Deferred income tax asset | |
| Asset impairment provision | 19,586,893.46 | 4,896,723.38 | 475,877.30 | 118,969.33 |
| Lease Liabilities | 1,866,033.17 | 466,508.30 | ||
| Total | 21,452,926.63 | 5,363,231.68 | 475,877.30 | 118,969.33 |
(2) Deferred income tax liabilities without offset
In RMB
| Item | Ending balance | Opening balance | ||
| Taxable temporary differences | Deferred income tax liabilities | Taxable temporary differences | Deferred income tax liabilities | |
| Right to use assets | 1,816,269.83 | 454,067.46 | ||
| Total | 1,816,269.83 | 454,067.46 | ||
(3) Deferred income tax assets and deferred income tax liabilities listed after off-set
In RMB
| Item | Trade-off between the deferred income tax assets and liabilities | Ending balance of deferred income tax assets or liabilities after off-set | Trade-off between the deferred income tax assets and liabilities at period-begin | Opening balance of deferred income tax assets or liabilities after off-set |
| Deferred income tax asset | 454,067.46 | 4,909,164.22 | 118,969.33 | |
| Deferred income tax liabilities | 454,067.46 |
(4) Details of deferred income tax assets without recognized
In RMB
| Item | Ending balance | Opening balance |
| Deductable temporary difference | 7,255,560.04 | 24,308,371.39 |
| Deductable loss | 2,346,162.39 | 3,430,783.01 |
| Total | 9,601,722.43 | 27,739,154.40 |
(5) Deductible losses of un-recognized deferred income tax assets expired on the followed year
In RMB
| Year | Ending amount | Opening amount | Note |
| 2024 | 1,144,129.87 | 2,234,396.35 | Deductable loss in 2019 |
| 2025 | 501,170.19 | 501,170.19 | Deductable loss in 2020 |
| 2026 | 303,928.96 | 303,928.96 | Deductable loss in 2021 |
| 2027 | 391,287.51 | 391,287.51 | Deductable loss in 2022 |
| 2028 | 5,645.86 | Deductable loss in 2023 | |
| Total | 2,346,162.39 | 3,430,783.01 |
Other note：
Nil
30. Other non-current assets
In RMB
| Item | Ending balance | Opening balance | ||||
| Book balance | Impairment provision | Book value | Book balance | Impairment provision | Book value | |
| Advance payment for house | 400,000.00 | 400,000.00 | 400,000.00 | 400,000.00 | ||
| Total | 400,000.00 | 400,000.00 | 400,000.00 | 400,000.00 | ||
Other note：
Nil
31. Assets with restricted ownership or right to use
In RMB
| Item | End of period | Beginning of period | ||||||
| Book balance | Book value | Restricted type | Restricted circumstance | Book balance | Book value | Restricted type | Restricted circumstance | |
| Monetary funds | 3,776,621.83 | 3,776,621.83 | Other | Litigation frozen funds | ||||
| Fixed assets | 2,959,824.00 | 1,960,883.40 | Other | For the talent housing purchased at a low price, Shenzhen China cannot apply for a | 2,959,824.00 | 2,094,075.48 | Other | For the talent housing purchased at a low price, Shenzhen China cannot apply for a |
| certificate, and the disposal can only be repurchased by the government | certificate, and the disposal can only be repurchased by the government | |||||||
| Total | 2,959,824.00 | 1,960,883.40 | 6,736,445.83 | 5,870,697.31 |
Other note：
Nil
32. Short-term loans
(1) Category
In RMB
| Item | Ending balance | Opening balance |
Explanation on short-term loans category:
Nil
(2) Overdue outstanding short-term loans
Total 0.00 Yuan overdue outstanding short-term loans at period-end, including the followed significant amount:
Unit: RMB/
| Borrower | Ending balance | Lending rate | Overdue time | Overdue rate |
Other note:
Nil
33. Trading financial liability
In RMB
| Item | Ending balance | Opening balance |
| Including: | ||
| Including: |
Other note:
Nil
34. Derivative financial liability
In RMB
| Item | Ending balance | Opening balance |
Other note:
Nil
35. Note payable
In RMB
| Category | Ending balance | Opening balance |
Notes expired at period-end without paid was 0.00 Yuan.
36. Account payable
(1) Account payable
In RMB
| Item | Ending balance | Opening balance |
| Within one year(one year included) | 5,583,501.96 | 1,914,595.55 |
| 1-2 years (2 years included) | 83,999.55 | 12,683.17 |
| 2-3 years (3 years included) | 1,158.00 | 48,424.51 |
| Over 3 years | 545,005.51 | 901,720.00 |
| Total | 6,213,665.02 | 2,877,423.23 |
(2) Important account payable with account age over one year
In RMB
| Item | Ending balance | Reasons for non-reimbursement or carry-forward |
Other note:
Nil
37.Other account payable
In RMB
| Item | Ending balance | Opening balance |
| Other account payable | 39,034,314.13 | 48,621,087.98 |
| Total | 39,034,314.13 | 48,621,087.98 |
(1) Interest payable
In RMB
| Item | Ending balance | Opening balance |
Important overdue interest
In RMB
| Unit | Overdue amount | Overdue reason |
Other note:
Nil
(2) Dividend Payable
In RMB
| Item | Ending balance | Opening balance |
Other explanation:including dividends payable with over one year age and disclosure un-payment reasonsNil
（3）Other account payable
1) By nature
In RMB
| Item | Ending balance | Opening balance |
| Custodian and common benefit debts | 25,907,507.61 | 28,624,749.18 |
| Warranty and guarantee money | 1,501,940.00 | 1,781,940.00 |
| Intercourse funds | 9,578,367.65 | 16,500,000.00 |
| Payment | 1,327,373.90 | 801,237.73 |
| Collection and payment | 686,076.86 | 669,657.66 |
| Other | 33,048.11 | 243,503.41 |
| Total | 39,034,314.13 | 48,621,087.98 |
2) Significant other payable with over one year age
In RMB
| Item | Ending balance | Reasons for non-reimbursement or carry-forward |
| Custodian and common benefit debts | 25,622,651.01 | Annual settlement offset |
| Shenzhen Guocheng Energy Investment Development Co., Ltd. | 6,500,000.00 | Intercourse funds |
| Total | 32,122,651.01 |
3) Other payables of the top five ending balances aggregated by counterpartyOther note:
Nil
38. Accounts received in advance
(1) Accounts received in advance
In RMB
| Item | Ending balance | Opening balance |
(2) Account received in advance with over one year book age
In RMB
| Item | Ending balance | Reasons for non-reimbursement or carry-forward |
39. Contractual liability
In RMB
| Item | Ending balance | Opening balance |
| Receipt of goods in advance | 633,114.64 | 791,762.84 |
| Total | 633,114.64 | 791,762.84 |
Contractual liability in advance with over one year book age
In RMB
| Item | Ending balance | Reasons for non-reimbursement or carry-forward |
Book value has major changes in the period and causes
In RMB
| Item | Amount changes | Reason for change |
40. Wage payable
(1) Wage payable
In RMB
| Item | Opening balance | Current increased | Current decreased | Ending balance |
| I. Short-term compensation | 769,992.42 | 7,166,161.12 | 6,787,001.73 | 1,149,151.81 |
| II. Post-employment benefit-Defined contribution plan | 668,294.08 | 668,294.08 | ||
| Total | 769,992.42 | 7,834,455.20 | 7,455,295.81 | 1,149,151.81 |
(2) Short-term compensation
In RMB
| Item | Opening balance | Current increased | Current decreased | Ending balance |
| 1. Wages, bonus, allowances and subsidy | 763,809.95 | 6,226,449.67 | 5,846,747.03 | 1,143,512.59 |
| 2. Employee benefits | 109,018.08 | 109,018.08 | ||
| 3. Social insurance | 359,946.50 | 359,946.50 | ||
| Including: Medical insurance | 328,393.51 | 328,393.51 | ||
| Work injury insurance | 10,118.24 | 10,118.24 |
| Maternity insurance | 21,434.75 | 21,434.75 | ||
| 4. Housing accumulation fund | 408,454.28 | 408,454.28 | ||
| 5. Labor union expenditure and personnel education expense | 6,182.47 | 62,292.59 | 62,835.84 | 5,639.22 |
| Total | 769,992.42 | 7,166,161.12 | 6,787,001.73 | 1,149,151.81 |
(3) Defined contribution plan
In RMB
| Item | Opening balance | Current increased | Current decreased | Ending balance |
| 1. Basic endowment insurance | 652,212.06 | 652,212.06 | ||
| 2. Unemployment insurance | 16,082.02 | 16,082.02 | ||
| Total | 668,294.08 | 668,294.08 |
Other note:
Nil
41. Taxes payable
In RMB
| Item | Ending balance | Opening balance |
| Value added tax | 6,575,136.32 | 33,374,610.42 |
| Enterprise income tax | 3,833,579.07 | 1,113,788.23 |
| Individual income tax | 71,356.63 | 29,149.60 |
| City maintenance & construction tax | 446,567.07 | 2,056,530.87 |
| Stamp tax | 52,178.40 | 101,516.08 |
| Educational surcharge | 318,938.97 | 1,468,913.16 |
| Total | 11,297,756.46 | 38,144,508.36 |
Other note:
Nil
42. Liability held for sale
In RMB
| Item | Ending balance | Opening balance |
Other note:
Nil
43. Non-current liabilities due within one year
In RMB
| Item | Ending balance | Opening balance |
| Lease liabilities due within one year | 847,403.05 | 210,892.38 |
| Total | 847,403.05 | 210,892.38 |
Other note:
Nil
44. Other current liabilities
In RMB
| Item | Ending balance | Opening balance |
| VAT received in advance | 82,304.90 | 102,929.16 |
| Total | 82,304.90 | 102,929.16 |
Changes of short-term bond payable:
In RMB
| Bond | Face value | Interest rate | Release date | Bond period | Issuing amount | Opening balance | Issued in the Period | Accrual interest by face value | Premium/discount amortization | Paid in the Period | Ending balance | Whether default | |
| Total |
Other note:
Nil
45. Long-term loans
(1)Category
In RMB
| Item | Ending balance | Opening balance |
Explanation on category of long-term loans:
NilOther note: including interest rate sectionNil
46. Bonds payable
(1) Bonds payable
In RMB
| Item | Ending balance | Opening balance |
(2) Changes of bonds payable (not including the other financial instrument of preferred stock andperpetual capital securities that classify as financial liability)
In RMB
| Bond | Face value | Interest rate | Release date | Bond period | Issuing amount | Opening balance | Issued in the Period | Accrual interest by face value | Premium/discount amortization | Paid in the Period | Ending balance | Whether default | |
| Total | —— | —— | |||||||||||
(3) Convertible conditions and time for shares transfer for the convertible bondsNil
(4) Other financial instruments classify as financial liability
Outstanding other financial instruments as preferred stock and perpetual bonds at period-endNilChanges of the outstanding financial instruments as preferred stock and perpetual bonds at period-end
In RMB
| Outstanding financial instrument | Period-begin | Current increased | Current decreased | Period-end | ||||
| Amount | Book value | Amount | Book value | Amount | Book value | Amount | Book value | |
Basis for financial liability classification for other financial instrumentNilOther note:
Nil
47. Lease liability
In RMB
| Item | Ending balance | Opening balance |
| Lease payment amount | 1,925,673.72 | 204,180.88 |
| Including：Within 1 year | 891,837.48 | 204,180.88 |
| 1-2 years | 918,592.59 | |
| 2-3 years | 115,243.65 | |
| Unrecognized financing charges | -59,640.55 | 6,711.50 |
| Including：Within 1 year | -44,434.43 | 6,711.50 |
| 1-2 years | -18,290.17 |
| 2-3 years | 3,084.05 | |
| Reclassified to lease liabilities due within one year | -847,403.05 | -210,892.38 |
| Total | 1,018,630.12 | 0 |
Other note:
Nil
48. Long-term account payable
In RMB
| Item | Ending balance | Opening balance |
(1) Nature of long-term account payable
In RMB
| Item | Ending balance | Opening balance |
Other note:
Nil
(2) Special payable
In RMB
| Item | Opening balance | Current increased | Current decreased | Ending balance | Causes |
Other note:
Nil
49. Long-term wages payable
(1) Long-term wages payable
In RMB
| Item | Ending balance | Opening balance |
(2) Changes of defined benefit plans
Present value of the defined benefit plans:
In RMB
| Item | Current period incurred | Prior period incurred |
Scheme assets:
In RMB
| Item | Current period incurred | Prior period incurred |
Net liability (assets) of the defined benefit plans
In RMB
| Item | Current period incurred | Prior period incurred |
Content of defined benefit plans and relevant risks, impact on future cash flow of the Company as well as times
and uncertainty:
NilMajor actuarial assumption and sensitivity analysis:
NilOther note:
Nil
50. Accrual liability
In RMB
| Item | Ending balance | Opening balance | Causes |
| Outstanding litigation | 887,342.00 | ||
| Total | 887,342.00 |
Other explanation, including relevant important assumptions and estimation:
Nil
51. Deferred income
In RMB
| Item | Opening balance | Current increased | Current decreased | Ending balance | Causes |
Other note:
Nil
52. Other non-current liabilities
In RMB
| Item | Ending balance | Opening balance |
Other note:
Nil
53. Share capital
In RMB
| Opening balance | Changes in the period (+, -) | Ending balance | |||||
| New shares issued | Bonus share | Shares transferred from capital reserve | Other | Subtotal | |||
| Total shares | 689,184,933. | 689,184,933. | |||||
| 00 | 00 |
Other note:
Nil
54. Other equity instrument
(1) Outstanding other financial instruments as preferred stock and perpetual bonds at period-endNil
(2) Changes of the outstanding other financial instruments as preferred stock and perpetual bonds atperiod-end
In RMB
| Outstanding financial instrument | Period-begin | Current increased | Current decreased | Period-end | ||||
| Amount | Book value | Amount | Book value | Amount | Book value | Amount | Book value | |
Changes of other equity instrument, change reasons and relevant accounting treatment basis:
Nil
Other note:
Nil
55. Capital public reserve
In RMB
| Item | Opening balance | Current increased | Current decreased | Ending balance |
| Capital premium(Share capital premium) | 150,990,173.10 | 12,098,051.76 | 11,368,072.35 | 151,720,152.51 |
| Other capital public reserve | 627,834,297.85 | 627,834,297.85 | ||
| Including: Debt restructuring income | 482,580,588.23 | 482,580,588.23 | ||
| Other | 145,253,709.62 | 145,253,709.62 | ||
| Total | 778,824,470.95 | 12,098,051.76 | 11,368,072.35 | 779,554,450.36 |
Other note:including changes and reasons for changes
1. The increase in share capital premium in the current period is due to the failure of the controllingshareholder Wansheng Industrial Holdings (Shenzhen) Co., Ltd. to complete its performance commitment in2023, and Shenzhen Chinashall receive its performance compensation of RMB 12,098,051.76 in 2023 andincluded in the capital reserve-share premium.
2. The decrease in share capital premium in the current period is due to the acquisition of equity of allminority shareholders of Shenzhen Xinsen Jewelry & Gold Supply Chain Co., Ltd., a subsidiary of ShenzhenChina, with the acquisition consideration of RMB 25,550,000.00, deducting the value of minority equity ofRMB 14,181,927.65, and the difference is included in the capital reserve-share capital premium of RMB11,368,072.35.
56. Inventory shares
In RMB
| Item | Opening balance | Current increased | Current decreased | Ending balance |
Other note:including changes and reasons for changesNil
57. Other comprehensive income
In RMB
| Item | Opening balance | Current period incurred | Ending balance | |||||
| Account before income tax in the period | Less: written in other comprehensive income in previous period and carried forward to gains and losses in current period | Less: written in other comprehensive income in previous period and carried forward to retained earnings in current period | Less: Income tax expense | Belong to parent company after tax | Belong to minority shareholders after tax | |||
Other note: including the active part of the hedging gains/losses of cash flow transfer to initial recognitionadjustment for the arbitraged itemsNil
58. Reasonable reserve
In RMB
| Item | Opening balance | Current increased | Current decreased | Ending balance |
Other note:including changes and reasons for changesNil
59. Surplus public reserve
In RMB
| Item | Opening balance | Current increased | Current decreased | Ending balance |
| Statutory surplus reserves | 32,673,227.01 | 32,673,227.01 | ||
| Total | 32,673,227.01 | 32,673,227.01 |
Explanation: including changes and reasons for changesNil
60. Retained profit
In RMB
| Item | Current period | Prior period |
| Retained profit at period-end before adjustment | -1,210,553,312.45 | -1,202,936,933.70 |
| Retained profit at period-begin after adjustment | -1,210,553,312.45 | -1,202,936,933.70 |
| Add: net profit attributable to shareholders of parent company for this year | 17,901,948.24 | -7,616,378.75 |
| Retained profit at period-end | -1,192,651,364.21 | -1,210,553,312.45 |
Adjustment for retained profit at period-begin:
1) Retroactive adjustment due to the Accounting Standards for Business Enterprise and relevant new regulations,retained profit at period-begin has 0.00 Yuan affected;
2) Due to the accounting policy changes, retained profit at period-begin has 0.00 Yuan affected;
3) Due to the major accounting errors correction, retained profit at period-begin has 0.00 Yuan affected;
4) Consolidation range changed due to the same control, retained profit at period-begin has 0.00 Yuan affected;
5) Total other adjustment impacts 0.00 Yuan retained profit at period-begin
61. Operation revenue and operation cost
In RMB
| Item | Current period incurred | Prior period incurred | ||
| Revenue | Cost | Revenue | Cost | |
| Main business | 566,561,755.03 | 531,428,889.46 | 441,648,114.02 | 416,413,503.39 |
| Other business | 1,920,152.89 | 177,271.91 | 3,114,124.23 | 471,249.78 |
| Total | 568,481,907.92 | 531,606,161.37 | 444,762,238.25 | 416,884,753.17 |
Whether the audited net profit before and after deducting non-recurring gains and losses is negative
□Yes ?No
Breakdown of operating income and operating costs:
In RMB
| Contract type | 1# Division | 2# Division | Total | |||||
| Revenue | Cost | Revenue | Cost | Revenue | Cost | Revenue | Cost | |
| Business type | ||||||||
| Including： | ||||||||
| Jewelry and gold | 564,839,114.22 | 530,252,110.65 | 564,839,114.22 | 530,252,110.65 | ||||
| Bicycles, | 3,642,793.7 | 1,354,050.7 | 3,642,793.7 | 1,354,050.7 | ||||
| electric vehicles, lithium battery materials and others | 0 | 0 | 0 | 0 | ||||
| Classification by business area | ||||||||
| Including: | ||||||||
| Market or customer type | ||||||||
| Including: | ||||||||
| Contract type | ||||||||
| Including: | ||||||||
| Classification by time of goods transfer | ||||||||
| Including: | ||||||||
| Classification by contract duration | ||||||||
| Including: | ||||||||
| Classification by sales channel | ||||||||
| Including: | ||||||||
| Total | 568,481,907.92 | 531,606,161.37 | 568,481,907.92 | 531,606,161.37 |
Information related to performance obligations:
| Item | The time to fulfill the performance obligation | Important payment terms | The nature of the goods that the company promises to transfer | Whether it is the main responsible person | The expected refunds to customers borne by the company | The types of quality assurance provided by the company and |
relatedobligations
Other note:
NilInformation relating to the transaction price assigned to the remaining performance obligation:
The amount of revenue corresponding to performance obligation that have been signed but have not beenfulfilled or have not been fulfilled at the end of the period was 0.00 Yuan, including 0.00 Yuan is expected to berecognized as revenue in subsequent years, 0.00 Yuan is expected to be recognized as revenue in subsequentyears, 0.00 Yuan is expected to be recognized as revenue in subsequent years. Other explanation:
NilSignificant contract changes or significant transaction price adjustments
In RMB
| Item | Accounting treatment method | The impacted amount on revenue |
Other note:
Nil
62. Tax and surcharge
In RMB
| Item | Current period incurred | Prior period incurred |
| City maintenance & construction tax | 460,159.66 | 2,060,815.10 |
| Educational surcharge | 328,676.41 | 1,472,010.75 |
| Vehicle and vessel usage tax | 719.68 | |
| Stamp tax | 244,522.84 | 225,148.85 |
| Total | 1,034,078.59 | 3,757,974.70 |
Other note:
Nil
63. Administrative expenses
In RMB
| Item | Current period incurred | Prior period incurred |
| Employee compensation | 2,374,309.33 | 3,304,419.89 |
| Intermediary service fee | 1,159,760.18 | 996,070.70 |
| Daily administrative expenses | 2,266,857.83 | 1,982,406.14 |
| Depreciation and amortization | 961,386.66 | 1,242,279.43 |
| Total | 6,762,314.00 | 7,525,176.16 |
Other note:
Nil
64. Sales expenses
In RMB
| Item | Current period incurred | Prior period incurred |
| Employee compensation | 1,869,966.44 | 1,354,906.96 |
| Mall service fee | 1,862,848.65 | 2,425,661.82 |
| Marketing promotion fees | 773,471.61 | 631,247.89 |
| Business entertainment | 586,271.53 | 360.00 |
| Business travel expenses | 89,204.57 | 344,559.08 |
| Lease fee | 16,130.04 | |
| Design fee | 7,219.80 | 471,871.00 |
| Depreciation and amortization | 448,725.49 | 227,870.06 |
| Online marketing fee | 163,247.72 | |
| Other | 187,339.09 | 215,650.83 |
| Total | 5,988,294.90 | 5,688,257.68 |
Other note:
Nil
65. R&D expenses
In RMB
| Item | Current period incurred | Prior period incurred |
| Employee compensation and benefits | 1,252,650.29 | 901,277.20 |
| Depreciation and amortization | 17,862.13 | 23,290.50 |
| Total | 1,270,512.42 | 924,567.70 |
Other note:
Nil
66. Finance expenses
In RMB
| Item | Current period incurred | Prior period incurred |
| Interest expenses ，Including：Financing expenses recognized by lease liabilities | 55,573.42 | 33,239.03 |
| Interest income | -93,865.93 | -272,353.25 |
| Commission charge etc. | 23,100.30 | 42,766.84 |
| Total | -15,192.21 | -196,347.38 |
Other note:
Nil
67. Other income
In RMB
| Sources | Current period incurred | Prior period incurred |
| Government subsidy | 120,500.00 | 142,981.96 |
| Personal tax withholding fee | 2,092.35 | 3,369.17 |
68. Net exposure hedge gains
In RMB
| Item | Current period incurred | Prior period incurred |
Other note:
Nil
69. Income from change of fair value
In RMB
| Sources | Current period incurred | Prior period incurred |
Other note:
Nil
70. Investment income
In RMB
| Item | Current period incurred | Prior period incurred |
Other note:
Nil
71. Loss of credit impairment
In RMB
| Item | Current period incurred | Prior period incurred |
| Bad debt loss of other account receivable | -2,780,028.91 | -15,456,941.61 |
| Bad debt losses of other accounts receivable | 44,170.60 | -59,830.83 |
| Total | -2,735,858.31 | -15,516,772.44 |
Other note:
Nil
72. Impairment loss on assets
In RMB
| Item | Current period incurred | Prior period incurred |
| I. Loss of inventory falling price and loss of contract performance cost impairment | -316,923.59 | -110,756.09 |
| V. Impairment loss of fixed asset | -729,605.75 | |
| Total | -316,923.59 | -840,361.84 |
Other note:
Nil
73. Income from assets disposal
In RMB
| Sources | Current period incurred | Prior period incurred |
| Dispose income of non current assets | -16,957.53 |
74. Non-operating income
In RMB
| Item | Current period incurred | Prior period incurred | Amount reckoned in current non-recurring gains/losses |
| Income from escrow assets | 4,071,358.65 | 3,837,081.41 | 4,071,358.65 |
| Esccrow assets renaming fee and other | 541,058.80 | 239,571.50 | 541,058.80 |
| Other | 1,313,302.68 | 4,797.84 | 1,313,302.68 |
| Total | 5,925,720.13 | 4,081,450.75 | 5,925,720.13 |
Other note:
The profit or loss of escrow assets refers to the fact that the property rights of some assets used to pay offdebts at the termination of the bankruptcy reorganization of Shenzhen China in the previous period were notclear and could not be disposed of, and the Shenzhen Intermediate People's Court approved Shenzhen China tomanage its own property and business affairs under the supervision of the administrator, and the administratorand Shenzhen China settled the income and expenditure on an annual basis. The tax on the daily expenses of theentrusted assets is included in the non-operating expenses-entrusted asset expenses, and the difference betweenthe rental of the assets and the settlement with the manager is included in the non-operating income - incomefrom entrusted assets.
75. Non-operating expense
In RMB
| Item | Current period incurred | Prior period incurred | Amount reckoned in current non-recurring gains/losses |
| Total scrap loss of non-current assets | 12,298.94 | 12,298.94 | |
| Including：Loss of fixed assets | 12,298.94 | 12,298.94 | |
| Penalty cost | 2,292,111.17 | 2.31 | 2,292,111.17 |
| Compensation for litigation | -137,713.91 | 878,000.00 | -137,713.91 |
| Escrow assets fess | 4,071,358.65 | 3,837,081.41 | 4,071,358.65 |
| Other | 1.56 | 28,940.41 | 1.56 |
| Total | 6,238,056.41 | 4,744,024.13 | 6,238,056.41 |
Other note
The penalty and confiscation expenses mainly refer to the late payment of VAT and additional tax ofRMB 2,291,712.88 arising from the delay in payment of VAT in the current period.
76. Income tax expense
(1) Income tax expense
In RMB
| Item | Current period incurred | Prior period incurred |
| Current income tax expense | 5,377,855.04 | 1,324,808.04 |
| Deferred income tax expense | -4,790,194.89 | -54,922.66 |
| Total | 587,660.15 | 1,269,885.38 |
(2) Adjustment on accounting profit and income tax expenses
In RMB
| Item | Current period incurred |
| Total profit | 18,593,213.02 |
| Income tax measured by statutory/applicable tax rate | 4,648,303.26 |
| The impact of applying different tax rates to subsidiaries | -70,504.54 |
| Impact of adjusting the income tax of prior period | -81,730.80 |
| Impact on cost, expenses and losses that unable to deducted | 681,072.96 |
| The impact of deductible losses on the use of deferred income tax assets not recognized in prior period | -4,495,471.97 |
| The impact of deductible temporary differences or deductible losses on deferred income tax assets not recognized in the Period | 35,833.45 |
| Additional deductible expenses under the tax code | -129,842.21 |
| Income tax expense | 587,660.15 |
Other note:
Nil
77. Other comprehensive income
Refer to the Note
78.Items of Cash flow statement
（1）Cash related to operating activities
Other cash received from business operation
In RMB
| Item | Current period incurred | Prior period incurred |
| Interest, rent, utilities, etc. | 2,274,468.58 | 2,518,300.99 |
| Deposits and guarantees received | 98,626.00 | 267,840.00 |
| Government subsidy and individual tax handling fee refund | 122,717.90 | 146,354.32 |
| Employee correspondence | 116,432.76 | |
| Litigation freezes funds | 3,776,621.83 | |
| Other | 656,321.82 | 6,871,962.41 |
| Total | 7,045,188.89 | 9,804,457.72 |
Explanation on other cash received in relation to operation activities:
NilOther cash paid in relation to operation activities
In RMB
| Item | Current period incurred | Prior period incurred |
| Expenses such as rent and property management maintenance fees | 1,256,526.69 | 3,837,081.41 |
| Deposits and security deposits paid | 317,948.30 | 8,001,780.56 |
| Sales, management and R&D expenses | 6,122,472.33 | 5,399,850.61 |
| Litigation compensation, liquidated damages and late fees, etc. | 1,202,286.73 | |
| Handling expenses | 22,970.30 | 42,766.84 |
| Return project cooperation funds | 10,000,000.00 | |
| Other | 318,774.81 | 4,917,479.65 |
| Total | 19,240,979.16 | 22,198,959.07 |
Explanation on other cash paid in relation to operation activities:
Nil
（2）Cash related to Investment activities
Cash receivable related to other Investment activities
In RMB
| Item | Current period incurred | Prior period incurred |
Receivable for important cash related to investment activities
In RMB
| Item | Current period incurred | Prior period incurred |
Explanation on other cash received from investment activities:
NilCash paid related with investment activities
In RMB
| Item | Current period incurred | Prior period incurred |
Payable for important cash related to investment activities
In RMB
| Item | Current period incurred | Prior period incurred |
Explanation on cash paid related with investment activitiesNil
(3)Cash related to Financing activities
Other cash received in relation to financing activities
In RMB
| Item | Current period incurred | Prior period incurred |
| Received the private placement deposit | 9,000,000.00 | |
| Total | 9,000,000.00 |
Explanation on other cash received in relation to financing activities:
NilOther cash paid related with financing activities
In RMB
| Item | Current period incurred | Prior period incurred |
| Received the private placement deposit | 18,000,000.00 | |
| Issue direct fees | 729,772.03 | |
| Lease payment amount | 1,005,205.60 | 1,477,866.59 |
| Acquisition of minority shareholders of its subsidiary Xinsen | 25,550,000.00 | |
| Total | 26,555,205.60 | 20,207,638.62 |
Explanation on other cash paid related with financing activities:
NilChanges in various liabilities arising from fund-raising activities
□Applicable ?Not applicable
(4) Statement of cash flows on a net basis
| Item | Relevant factual circumstances | The basis for the use of net presentation | Financial impact |
(5) Major activities and financial impacts that do not involve cash receipts and expenditures in thecurrent period, but affect the financial position of the enterprise or may affect the cash flow of theenterprise in the futureNil
79. Supplementary information to statement of cash flow
(1) Supplementary information to statement of cash flow
In RMB
| Supplementary information | Current amount | Amount of the previous period |
| 1．Net profit adjusted to cash flow of operation activities: | ||
| Net profit | 18,005,552.87 | -7,982,343.22 |
| Add: Assets impairment provision | 3,052,781.90 | 16,357,134.28 |
| Depreciation of fixed assets, consumption of oil assets and depreciation of productive biology assets | 180,877.95 | 384,570.94 |
| Depreciation of right-of-use assets | 921,812.53 | 1,235,536.34 |
| Amortization of intangible assets | ||
| Amortization of long-term deferred |
| expenses | ||
| Loss from disposal of fixed assets, intangible assets and other long-term assets (gain is listed with “-”) | 16,957.53 | |
| Losses on scrapping of fixed assets (gain is listed with “-”) | 12,298.94 | |
| Gain/loss of fair value changes (gain is listed with “-”) | ||
| Financial expenses (gain is listed with “-”) | 55,573.42 | 33,239.03 |
| Investment loss (gain is listed with “-”) | ||
| Decrease of deferred income tax asset (increase is listed with “-”) | -4,790,194.89 | -54,922.66 |
| Increase of deferred income tax liability (decrease is listed with “-”) | ||
| Decrease of inventory (increase is listed with “-”) | -34,026,095.92 | -40,069,049.13 |
| Decrease of operating receivable accounts (increase is listed with “-”) | 80,289,900.17 | -257,151,228.59 |
| Increase of operating payable accounts (decrease is listed with “-”) | -33,729,676.35 | 29,587,661.28 |
| Other | -3,776,621.83 | |
| Net cash flow arising from operating activities | 29,972,830.62 | -261,419,066.03 |
| 2. Material investment and financing not involved in cash flow | ||
| Conversion of debt into capital | ||
| Switching Company bonds due within one year | ||
| Financing lease of fixed assets | ||
| 3. Net change of cash and cash equivalents: | ||
| Balance of cash at period end | 54,148,674.40 | 50,922,869.35 |
| Less: Balance of cash equivalent at year-begin | 50,922,869.35 | 33,246,957.92 |
| Add: Balance at year-end of cash equivalents | ||
| Less: Balance at year-begin of cash equivalents | ||
| Net increased amount of cash and cash equivalent | 3,225,805.05 | 17,675,911.43 |
(2) Net cash paid for obtaining subsidiary in the Period
In RMB
| Amount | |
| Including: | |
| Including: | |
| Including: |
Other note:
Nil
（3）Net cash received by disposing subsidiary in the Period
In RMB
| Amount | |
| Including: | |
| Including: |
| Including: |
Other note:
Nil
(4) Constitution of cash and cash equivalent
In RMB
| Item | Ending balance | Opening balance |
| I. Cash | 54,148,674.40 | 50,922,869.35 |
| Including: Cash on hand | 13,955.25 | 33,531.25 |
| Bank deposit available for payment at any time | 54,134,719.15 | 50,889,338.10 |
| III. Balance of cash and cash equivalents at the period -end | 54,148,674.40 | 50,922,869.35 |
(5) Situations where the scope of use is limited but still classified as cash and cash equivalents
In RMB
| Item | Amount of the current period | Amount of the previous period | Reason for still being classified as cash and cash equivalents |
( 6) Monetary funds that do not belong to cash and cash equivalents
In RMB
| Item | Amount of the current period | Amount of the previous period | Reason for not belonging to cash and cash equivalents |
| Other monetary funds | 3,776,621.83 | Litigation frozen funds | |
| Total | 3,776,621.83 |
Other note:
Nil
(7) Description of other major activities
Nil
80. Notes of changes of owners’ equity
Explain the name and adjusted amount in “Other” at end of last period:
Nil
81. Foreign currency monetary items
(1) Foreign currency monetary items
In RMB
| Item | Ending foreign currency balance | Convert rate | Ending RMB balance converted |
| Monetary fund | |||
| Including: USD | |||
| EURO | |||
| HKD | |||
| Account receivable | |||
| Including: USD | |||
| EURO | |||
| HKD | |||
| Long-term loans | |||
| Including: USD | |||
| EURO | |||
| HKD | |||
Other note:
Nil
(2) Explanation on foreign operational entity, including as for the major foreign operational entity,disclosed main operation place, book-keeping currency and basis for selection; if the book-keepingcurrency changed, explain reasons
□Applicable ?Not applicable
82. Leasing
(1) The Company acts as the lessee
?Applicable □Not applicableVariable lease payments that are not included in the measurement of lease liabilities
□Applicable ?Not applicable
Simplified processing of lease costs for short-term leases or lease for low-value assets?Applicable □Not applicableLease costs for short-term leases or low-value assets with simplified processing: RMB 102,287.64.Cases involving sale-leaseback transactionsNil
(2) The Company acts as the lessor
Operating lease as a lessor?Applicable □Not applicable
In RMB
| Item | Rental income | Thereinto: income related to variable lease payments that are not included in lease receipts |
| lease of houses | 48,307.63 | |
| Total | 48,307.63 |
Financial lease as a lessor
□Applicable ?Not applicable
Annual undiscounted lease receipts for the next five years
□Applicable ?Not applicable
Adjustment table for undiscounted lease receipts and net lease investmentsNil
(3) Recognition of financial lease sales gains and losses as a producer or distributor
□Applicable ?Not applicable
83.Other
NilVIII. R&D expenditure
In RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Employee remuneration and benefits | 1,252,650.29 | 901,277.20 |
| Depreciation and amortization | 17,862.13 | 23,290.50 |
| Total | 1,270,512.42 | 924,567.70 |
| Thereinto: expensed R&D expenditure | 1,270,512.42 | 924,567.70 |
1. R&D projects that meet the conditions for capitalization
In RMB
| Project | Opening balance | Amount increased in the current period | Amount decreased in the current period | Ending balance | ||||
| Internal development expenditures | Others | Recognized as intangible assets | Transferred to profit or loss for the current period | |||||
| Total | ||||||||
Significant capitalized R&D projects
| Project | R&D progress | Estimated completion time | Expected way of generating economic benefits | The point at which capitalization begins | The specific basis for starting capitalization |
Provision for impairment of development expenditure
In RMB
| Item | Opening balance | Increase in the current period | Decrease in the current period | Ending balance | Impairment test situation |
2.Important outsourcing projects under research
| Name of project | Expected way of generating economic benefits | Criteria and specific basis for determining capitalization or expensing |
Other note:
Nil
IX. Changes of consolidation scope
1. Enterprise combined under different control
(1) Enterprise combined under different control in the Period
In RMB
| Acquiree | Time point for equity obtained | Cost of equity obtained | Ratio of equity obtained | Acquired way Equity obtained way | Purchasing date | Standard to determine the purchasing date | Income of acquiree from purchasing date to period-end | Net profit of acquiree from purchasing date to period-end |
Other note:
Nil
(2) Combination cost and goodwill
In RMB
| Consolidation cost | |
| --Cash | |
| --Fair value of non-cash assets | |
| --Fair value of debts issued or assumed | |
| --Fair value of equity securities issued | |
| -- Fair value of contingent consideration | |
| --Fair value of the equity prior to the purchasing date | |
| --Other | |
| Total combination cost | |
| Less: shares of fair value of identifiable net assets acquired | |
| The amount by which the goodwill/cost of consolidation is less than the share of fair value of identifiable net assets acquired |
Determination method for fair value of the combination cost：
NilContingent consideration and changes:
NilMain reasons for large goodwill resulted:
NilOther note:
Nil
(3) Identifiable assets and liability on purchasing date under the acquiree
In RMB
| Fair value on purchasing date | Book value on purchasing date | |
| Assets: | ||
| Monetary fund | ||
| Account receivable | ||
| Inventory | ||
| Fixed assets | ||
| Intangible assets | ||
| Liability: | ||
| Loan | ||
| Account payable | ||
| Deferred income tax liabilities | ||
| Net assets | ||
| Less: Minority interests | ||
| Net assets acquired |
Determination method for fair value of the identifiable assets and liabilities:
NilContingent liability of the acquiree bear during combination:
NilOther note:
Nil
(4) Gains or losses arising from re-measured by fair value for the equity held before purchasing dateWhether it is a business combination realized by two or more transactions of exchange and a transaction ofobtained control rights in the Period or not
□Yes?No
(5) On purchasing date or period-end of the combination, combination consideration or fair value ofidentifiable assets and liability for the acquiree are un-able to confirm rationallyNil
(6) Other Note:
Nil
2. Enterprise combine under the same control
(1) Enterprise combined under the same control in the Period
In RMB
| Combined party | Equity ratio obtained in combinatio | Basis of combined under the same | Combination date | Standard to determine the combinatio | Income of the combined party from | Net profit of the combined party from | Income of the combined party | Net profit of the combined party |
| n | control | n date | period-begin of combination to the combination date | period-begin of combination to the combination date | during the comparison period | during the comparison period |
Other note:
Nil
(2) Combination cost
In RMB
| Consolidation cost | |
| --Cash | |
| -- Book value of non-cash assets | |
| - Book value of debts issued or assumed | |
| -- The face value of the equity securities issued | |
| --Contingent consideration |
Explanation on contingent consideration and its changes:
NilOther note:
Nil
(3) Book value of the assets and liability of the combined party on combination date
In RMB
| Consolidation date | End of last period | |
| Assets: | ||
| Monetary fund | ||
| Account receivable | ||
| Inventory | ||
| Fixed assets | ||
| Intangible assets | ||
| Liability: | ||
| Loan | ||
| Account payable | ||
| Net assets | ||
| Less: Minority interests | ||
| Net assets acquired | ||
Contingent liability of the combined party bear during combination:
Nil
Other note:
Nil
3. Counter purchase
Basic transaction information, basis of counter purchase, whether making up business due to the assets andliability reserved by listed company and basis, determination of combination cost, amount and calculation onadjusted equity by equity transaction:
Nil
4. Subsidiary disposal
Whether lost controlling rights while dispose subsidiary on one time or not
□Yes ?No
Whether lost controlling rights in the Period while dispose subsidiary on two or more steps or not
□Yes?No
5. Other reasons for consolidation range changed
Reasons for changed on consolidation range (such as new subsidiary established, subsidiary liquidated etc.)Andrelevant information:
In the current period, four new wholly-owned subsidiaries are established, including Shenzhen Xinsen PrecisionManufacturing Co., Ltd.-with a registered capital of 5 million yuan, Fujian Huaxinbao Jewelry Co., Ltd.-with aregistered capital of 10 million yuan, Shenzhen Huabao Selection Jewelry Co., Ltd.-with a registered capital of5 million yuan, and Hainan Shenhua Industrial Co., Ltd.-with a registered capital of 5 million yuan.
6.Other
NilX. Equity in other entity
1. Equity in subsidiary
(1) Constitute of enterprise group
Inn RMB
| Subsidiary | Registered capital | Main operation place | Registered place | Business nature | Share-holding ratio | Acquired way | |
| Directly | Indirectly | ||||||
| Shenzhen Xinsen Jewelry Gold Supply Chain Co., Ltd | 200,000,000.00 | Shenzhen | Shenzhen | Sales of Jewelry, diamonds and gold | 100.00% | Investment | |
| Shenzhen Xinsen Precision Manufacturing Co., Ltd. | 5,000,000.00 | Shenzhen | Shenzhen | Jewelry, diamonds, gold processing | 100.00% | Investment | |
| Shenzhen Emmelle Industrial Co., Ltd. | 5,000,000.00 | Shenzhen | Shenzhen | Distribution of bicycles and spare parts | 70.00% | Investment | |
| Shenzhen Emmelle Cloud Technology Co., Ltd. | 2,000,000.00 | Shenzhen | Shenzhen | Software and information technology service sales | 49.00% | Investment | |
| Fujian Huaxinbao Jewelry Co., Ltd. | 10,000,000.00 | Fujian Putian | Fujian Putian | Sales of Jewelry, diamonds and gold | 100.00% | Investment | |
| Shenzhen Huabao Zhenxuan Jewelry Co., Ltd. | 5,000,000.00 | Shenzhen | Shenzhen | Sales of Jewelry, diamonds and gold | 100.00% | Investment | |
| Hainan Industry Co., Ltd. | 5,000,000.00 | Haikou | Haikou | Import and export, trade, industry | 100.00% | Investment |
Explanation on share-holding ratio in subsidiary different from ratio of voting right:
NilBasis for controlling the invested entity with half or below voting rights held and without controlling investedentity but with over half and over voting rights:
Subsidiary of the Company-Shenzhen Emmelle Industry Co., Ltd. (with 70% equity held by the Company) holds70% equity of Shenzhen Emmelle Cloud Technology Co., LtdControlling basis for the structuring entity included in consolidated range:
NilBasis on determining to be an agent or consignor:
NilOther note:
Nil
(2) Important non-wholly-owned subsidiary
In RMB
| Subsidiary | Share-holding ratio of minority | Gains/losses attributable to minority in the Period | Dividend announced to distribute for minority in the Period | Ending equity of minority |
| Shenzhen Emmelle Industrial Co., Ltd. | 30.00% | 103,604.63 | 639,908.03 |
Explanation on share-holding ratio of minority different from ratio of voting right:
NilOther note:
Nil
(3) Main finance of the important non-wholly-owned subsidiary
In RMB
| Subsidiary | Ending 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 | |
| Shenzhen Emmelle Industrial Co., Ltd. | 9,689,931.74 | 73,727.87 | 9,763,659.61 | 9,316,963.25 | 9,316,963.25 | 11,501,525.61 | 128,543.56 | 11,630,069.17 | 11,522,950.66 | 9,342.00 | 11,532,292.66 | |
In RMB
| Subsidiary | Current period incurred | Prior period incurred | ||||||
| Operation revenue | Net profit | Total comprehensive income | Cash flow from operation activity | Operation revenue | Net profit | Total comprehensive income | Cash flow from operation activity | |
| Shenzhen Emmelle Industrial Co., Ltd. | 3,227,611.79 | 348,919.85 | 348,919.85 | -3,570,335.39 | 11,615,189.72 | -4,147,500.39 | -4,147,500.39 | -7,319,777.20 |
Other note:
Nil
(4) Major restriction on using corporate assets and liquidate corporate debtsNil
(5) Financial or other supporting provided to structuring entity that included in consolidated financialstatementNilOther note:
Nil
2. Transaction that has owners equity shares changed in subsidiary but still with controlling rights
(1) Owners equity shares changed in subsidiary
In the current period, Shenzhen China acquired the 35% equity-that is the entire equity of the minorityshareholders of Shenzhen Xinsen Jewelry Gold Supply Chain Co., Ltd.-a subsidiary, and after the completion ofthe acquisition, Xinsen became a wholly-owned subsidiary of Shenzhen China.
(2) Impact on minority’s interest and owners’ equity attributable to parent company
In RMB
| Purchase cost/disposal consideration | 25,550,000.00 |
| --Cash | 25,550,000.00 |
| --Fair value of non-cash assets | |
| Purchase cost/total disposal consideration | 25,550,000.00 |
| Less: Subsidiary's share of net assets calculated based on the proportion of acquired/disposed equity | 14,181,927.65 |
| Difference | 11,368,072.35 |
| Including: Adjust capital public reserve | 11,368,072.35 |
| Adjust surplus public reserve | |
| Adjusted retained profit |
Other note:
Nil
3. Equity in joint venture and associated enterprise
(1) Important joint venture or associated enterprise
| Joint venture or associated enterprise | Main operation place | Registered place | Business nature | Share-holding ratio | Accounting treatment | |
| Directly | Indirectly | |||||
Share-holding ratio or shares enjoyed different from voting right ratio:
NilBasis of the voting rights with 20% below but with major influence, or without major influence but with over 20%(20% included) voting rights hold:
Nil
(2) Main financial information of the important joint venture
In RMB
| Ending balance/Current period incurred | Opening balance/Prior period incurred | |
| Current assets | ||
| Including: cash and cash equivalent | ||
| Non-current assets | ||
| Total assets | ||
| Current liabilities | ||
| Non-current liabilities | ||
| Total liabilities | ||
| Minority interests | ||
| Shareholders' equity attributable to the parent company | ||
| Share of net assets calculated by shareholding ratio | ||
| Adjustment items | ||
| --Goodwill | ||
| --Unrealized profit of internal trading | ||
| --Other | ||
| Book value of equity investment in joint venture | ||
| Fair value of the equity investment of |
| joint ventures with public offers concerned | ||
| Operation revenue | ||
| Financial expenses | ||
| Income tax expense | ||
| Net profit | ||
| Net profit of discontinuing operation | ||
| Other comprehensive income | ||
| Total comprehensive income | ||
| Dividends received from joint venture in the year |
Other note:
Nil
(3) Main financial information of the important associated enterprise
In RMB
| Ending balance/Current period incurred | Opening balance/Prior period incurred | |
| Current assets | ||
| Non-current assets | ||
| Total assets | ||
| Current liabilities | ||
| Non-current liabilities | ||
| Total liabilities | ||
| Minority interests | ||
| Equity attributable to shareholder of parent company | ||
| Share of net assets measured by shareholding | ||
| Adjustment | ||
| --Goodwill | ||
| --Unrealized profit of internal trading | ||
| --Other | ||
| Book value of equity investment in associated enterprise | ||
| Fair value of the equity investment of associated enterprise with public offers concerned | ||
| Operation revenue | ||
| Net profit | ||
| Net profit of discontinuing operation | ||
| Other comprehensive income | ||
| Total comprehensive income | ||
| Dividends received from associated enterprise in the year |
Other note:
Nil
(4) Financial summary for un-important joint venture or associated enterprise
In RMB
| Ending balance/Current period incurred | Opening balance/Prior period incurred | |
| Joint venture： | ||
| Total numbers measured by share-holding ratio | ||
| Associated enterprise： | ||
| Total numbers measured by share-holding ratio |
Other note:
Nil
(5) Assets transfer ability has major restriction from joint venture or associated enterpriseNil
(6) Excess losses from joint venture or associated enterprise
In RMB
| Joint venture or associated enterprise | Cumulative un-confirmed losses | Un-confirmed losses not recognized in the Period (or net profit enjoyed in the Period) | Cumulative un-confirmed losses at period-end |
Other note:
Nil
(7) Un-confirmed commitment with investment concerned with joint ventureNil
(8) Contingent liability with investment concerned with joint venture or associated enterpriseNil
4.Co-runs operation
| Name | Main operation place | Registered place | Business nature | Share-holding ratio/share enjoyed | |
| Directly | Indirectly | ||||
Share-holding ratio or shares enjoyed different from voting right ratio:
NilIf the co-runs entity is the separate entity, basis of the co-runs classificationNilOther note:
Nil
5. Equity in structuring entity that excluding in the consolidated financial statementRelevant explanationNil
6.Other
NilXI. Government subsidy
1. Government subsidies recognized according to the receivable amount at the end of the reporting period
□Applicable ?Not applicable
The reason for not receiving the estimated amount of government subsidies at the expected point in time
□Applicable ?Not applicable
2. Liabilities involving government subsidies
□Applicable ?Not applicable
3. Government subsidies included in the current profit and loss
?Applicable □Not applicable
In RMB
| Accounting items | Amount incurred in the current period | Amount incurred in the previous period |
| Funding for the cultivation of high-tech enterprises | 120,000.00 | 100,000.00 |
| Job stabilization subsidy | 32,731.96 | |
| One-time training subsidy for job stay | 8,750.00 | |
| Subsidies for job expansion | 1,500.00 | |
| Government public employment subsidy | 500.00 | |
| Total | 120,500.00 | 142,981.96 |
Other note:
NilXII. Risks Related to Financial Instruments
1.Risks arising from financial instruments
The Company's main financial instruments include monetary funds, accounts receivable, receivablesfinancing, other receivables, other current assets, accounts payable, other payables, short-term borrowings, othercurrent liabilities, etc. Details of the financial instruments are provided in the relevant notes to the financialreport.The Company's risk management objective is to achieve an appropriate balance between risks and returns,to minimize the negative impact of risks on the Company's operating results, and to maximize the interests ofshareholders and other equity investors. Based on this risk management objective, the basic strategy of theCompany's risk management is to identify and analyze the various risks faced by the Company, establish anappropriate risk tolerance baseline and conduct risk management, and monitor various risks in a timely andreliable manner to control the risks within a limited range.The main risks associated with the Company's financial instruments are credit risk, liquidity risk andmarket risk. The Company's management is fully responsible for the determination of risk managementobjective and policy, and bears ultimate responsibility for risk management objective and policy. Managementreviews the effectiveness of the implemented procedures and the reasonableness of risk management objectiveand policy through work reports submitted by functional departments.(A) Credit riskCredit risk refers to the risk that one party to a financial instrument will fail to perform its obligations,resulting in financial losses to the other party. In order to mitigate credit risk, the Company has establishedinternal control policy responsible for determining credit limits, conducting credit approvals, including externalcredit ratings and, in some cases, bank references (where this information is available), and implementing othermonitoring procedures to ensure that necessary measures are taken to recover overdue creditor's right. As aresult, the management of the Company considers that the credit risk assumed by the Company has beensignificantly reduced.
The credit risk of the Company mainly arises from bank deposits, accounts receivable, prepayments, otherreceivables, etc., and the credit risk of these financial assets is derived from the default of the counterparty, andthe maximum risk exposure is equal to the carrying amount of these instruments.
1. The Company's working capital is deposited in a bank with a high credit rating, thus the credit risk ofthe working capital is low.
2. On the balance sheet date, the Company made provision for bad debts in accordance with theaccounting policy.
(B) Liquidity risk
Liquidity risk refers to the risk that an enterprise will have a shortage of funds when fulfilling itsobligation to settle by means of cash or other financial assets. It is the Company's policy to ensure that it hassufficient cash to pay off its debts as they fall due. Liquidity risk is centrally controlled by the Company'sfinance department. The finance department monitors cash balances, marketable securities that can beliquidated at any time, etc., to ensure that the Company has sufficient funds to repay its debts under allreasonably foreseeable circumstances.
(C) Market risk
Market risk refers to the risk that the fair value or future cash flows of financial instruments will fluctuatedue to changes in market prices, including interest rate risk, foreign exchange risk and other price risks. Interestrate risk refers to the risk that the fair value or future cash flows of a financial instrument will fluctuate due tochanges in market interest rates. The interest rate risk faced by the Company mainly comes from bank deposits.
2. Hedging
(1) The Company conducts hedging business for risk management
□Applicable ?Not applicable
(2) The Company conducts qualified hedging business and applies hedge accounting
In RMB
| Item | The carrying amount associated with the hedged item and the hedging instrument | The cumulative fair value hedge adjustment of the hedged items included in the recognized carrying amount of the hedged items | Sources of hedge effectiveness and hedge ineffectiveness part | The impact of hedge accounting on the Company's financial report |
| Type of hedging risk | ||||
| Hedging category | ||||
Other note:
Nil
（3） The Company conducts hedging business for risk management and expects to achieve riskmanagement objective but does not apply hedge accountingOther note:
Nil
3. Financial assets
(1) Classification of transfer methods
□Applicable ?Not applicable
(2) Financial assets that have been derecognized as a result of a transfer
□Applicable ?Not applicable
(3) Financial assets of continued involvement in asset transfer
□Applicable ?Not applicable
Other note:
NilXIII. Disclosure of fair value
1. Ending fair value of the assets and liabilities measured by fair value
In RMB
| Item | Ending fair value | |||
| First-order | Second-order | Third-order | Total | |
| I. Sustaining measured by fair value | -- | -- | -- | -- |
| II. Non-sustaining measured by fair value | -- | -- | -- | -- |
2. Recognized basis for the market price sustaining and non-persistent measured by fair value on first-orderThe quoted prices without adjustment in the active markets for identical assets or liabilities that are available atthe measurement date.
3. Valuation technique and qualitative and quantitative information on major parameters for the fairvalue measure sustaining and non-persistent on second-orderThe inputs for second-order are inputs other than first-order for which the related assets or liabilities are directlyor indirectly observable
4. Valuation technique and qualitative and quantitative information on major parameters for the fairvalue measure sustaining and non-persistent on third-orderThe third-order inputs are unobservable inputs for the underlying assets or liabilities. The fair value of the bankacceptance bill receivable from bank is determined using the face amount because the probability of loss issmall and the recoverable amount is basically determined
5. Adjustment information and sensitivity analysis of unobservable parameters for the fair value measuresustaining and non-persistent on third-order
Nil
6. Sustaining items measured by fair value, as for the conversion between at all levels, reasons forconversion and policy for conversion time pointNil
7. Changes of valuation technique in the Period
Nil
8. Financial assets and liability not measured by fair value
Nil
9. Other
NilXIV. Related party and related transactions
1. Parent company
| Parent company | Registered place | Business nature | Registered capital | Share-holding ratio on the enterprise for parent company | Voting right ratio on the enterprise |
| Wansheng Industrial Holdings (Shenzhen) Co., Ltd. | Shenzhen | General business: investment in establishment of industrial (specific items are separately declared) | 500 million Yuan | 20.00% | 20.00% |
Explanation on parent company of the enterpriseWansheng Industrial Holdings (Shenzhen) Co., Ltd. was established on May 10, 2016, with the businessperiod is from May 10, 2016 to no fixed term, the registered capital of the company is 500,000,000 yuan, theunified social credit code is 91440300MA5DCB5K9A, the enterprise type is a limited liability company, thelegal representative is Wang Shenghong, and the company's registered address is 1311, Beiyuehui Building, No.2115, Cuizhu Road, Cuijin Community, Cuizhu Street, Luohu District, Shenzhen.Ultimate controller of the Company: Wang ShenghongOther note:
Nil
2. Subsidiary of the Enterprise
Found more in Note VIII-1
3. Associated enterprise and joint venture
Found more in NoteOther associated enterprise and joint venture that have related transaction with the Company in the Period oroccurred in previous period
| Joint venture or associated enterprise | Relationship with the Company |
Other note:
Nil
4. Other related party
| Other related party | Relationship with the Company |
| Shenzhen Zuankinson Jewelry Gold Supply Chain Co., Ltd. | The minority shareholders of Shenzhen Xinsen Jewelry Gold Supply Chain Co., Ltd., a former subdiary, held 35% of the equity of Xinsen at the end of the previous period, which has been fully transferred to Shenzhen China in the current period. |
| Fuzhou Rongrun Jewelry Co., Ltd. | An enterprise actually controlled by Chen Xuejin, the wife of Chen Junrong, a shareholder of Shenzhen Zuanjinsen Jewelry Gold Supply Chain Co., Ltd |
| Fuzhou Zuankinson Jewelry Co., Ltd. | 100% equity held by Shenzhen Zuankinson Jewelry Gold Supply Chain Co., Ltd. |
| Shenzhen Chanjuan Jewelry Co., Ltd. | The enterprise with 30% equity held by actual controller Wang Shenghong |
| Shenzhen Guocheng Energy Investment Development Co., Ltd. | Enterprise that holds more than 5% of the shares of Shenzhen China |
Other note:
Nil
5. Related transaction
(1) Goods purchasing, labor service providing and receiving
Goods purchasing/labor service receiving
In RMB
| Related party | Transaction content | Current period incurred | Approved transaction amount | Whether more than the transaction amount | Prior period incurred |
| Shenzhen Chanjuan Jewelry Co., Ltd. | Goods purchasing | 166,608.44 |
Goods sold/labor service providing
In RMB
| Related party | Transaction content | Current period incurred | Prior period incurred |
| Fuzhou Rongrun Jewelry Co., Ltd. | Sales of goods | 58,901,124.34 | 96,810,724.96 |
| Fuzhou Zuankinson Jewelry Co., Ltd. | Sales of goods | 49,772,997.49 | 23,137,699.12 |
| Shenzhen Xinsen Jewelry Gold Supply Chain Co., Ltd | Sales of goods | 484,376.29 | 0 |
Explanation on goods purchasing, labor service providing and receivingIn the current period, Shenzhen China acquired all the minority shareholders’ equity of Shenzhen XinsenJewelry Gold Supply Chain Co., Ltd., a subsidiary of Shenzhen China, and after the completion of the
acquisition, Xinsen became a wholly-owned subsidiary of Shenzhen China, and the acquisition was completedat the beginning of August 2023. The statistical period of the afore-mentioned related party transactionwas fromJanuary to July 2023.
(2) Related trusteeship/contract and delegated administration/outsourcing
Trusteeship/contract
In RMB
| Client/ contract-out party | Entrusting party/ contractor | Assets type | Starting date | Maturity date | Yield pricing basis | Income from trusteeship/contract |
Explanation on related trusteeship/contractNilDelegated administration/outsourcing
In RMB
| Client/ contract-out party | Entrusting party/ contractor | Assets type | Starting date | Maturity date | Pricing basis of trustee fee/outsourcing fee | Trustee fee/outsourcing fee recognized in the Period |
Explanation on related administration/outsourcingNil
(3) Related lease
As a lessor for the Company::
In RMB
| Lessee | Assets type | Lease income recognized in the Period | Lease income recognized in prior Period |
As a lessee for the Company:
In RMB
| Lessor | Assets type | rental cost for short-term leases and low-value assets leases with simplified processing (if applicable) | Variable lease payment not included in the measurement of leasing liability (if applicable) | Rental paid | Interest expenses assumed on lease liability | Right-of-use assets increased | |||||
| Current period incurred | Prior period incurred | Current period incurred | Prior period incurred | Current period incurred | Prior period incurred | Current period incurred | Prior period incurred | Current period incurred | Prior period incurred | ||
Explanation on related leaseNil
(4) Related guarantee
As a guarantor for the Company
In RMB
| Secured party | Amount guarantee | Starting date | Due date | Guarantee completed (Y/N) |
As a secured party for the Company
In RMB
| Guarantor | Amount guarantee | Starting date | Due date | Guarantee completed (Y/N) |
Explanation on related guaranteeNil
(5) Borrowed funds of related party
In RMB
| Related party | Borrowed funds | Starting date | Due date | Note |
| Borrowing | ||||
| Lending | ||||
(6) Assets transfer and debt restructuring of related party
In RMB
| Related party | Transaction content | Current period incurred | Prior period incurred |
(7) Remuneration of key manager
In RMB
| Item | Current period incurred | Prior period incurred |
| Remuneration of key manager | 1,741,086.07 | 1,395,095.39 |
(8) Other related transactions
In June 2023, the "Proposal on Purchasing the Equity of Minority Shareholders of the Holding Subsidiarynamely the Related Party Transaction"was deliberated and approved in the fifth (extraordinary) meeting of the11th board of directors and the 2022 annual general meeting of shareholders of Shenzhen China respectively.Shenzhen China purchased 35% of the equity of Xinsen Supply Chain held by Shenzhen Zuanjinsenat a price ofRMB 25.55 million. On August 7, 2023, Shenzhen China completed the subsequent registration of the relevantindustrial and commercial changes of the afore-mentioned equity purchase.
6. Receivable/payable items of related parties
(1) Receivable item
In RMB
| Item | Related party | Ending balance | Opening balance | ||
| Book balance | Bad debt provision | Book balance | Bad debt provision | ||
| Account | Fuzhou Rongrun | 44,987,445.10 | |||
| receivable | Jewelry Co., Ltd. | ||||
| Account receivable | Fuzhou Zuankinson Jewelry Co., Ltd. | 19,085,600.00 |
(2) Payable item
In RMB
| Item | Related party | Ending book balance | Opening book balance |
| Other account payable | Shenzhen Guosheng Energy Investment Development Co., Ltd. | 6,500,000.00 | 6,500,000.00 |
| Account payable | Shenzhen Chanjuan Jewelry Co., Ltd. | 144,642.53 |
7. Commitments of related party
According to the Cooperation Agreement signed by Shenzhen China Bicycle Company (Holdings) Co.,Ltd. with Wansheng Industrial Holdings (Shenzhen) Co., Ltd. (hereinafter referred to as "Wansheng Industrial")and Shenzhen Guosheng Energy Investment and Development Co., Ltd. (hereinafter referred to as "GuoshengEnergy") on December 14, 2020, Wansheng Industrial promised that in the next three years from the next yearafter the completion of the non-public issuance of shares and the completion of the adjustment of the board ofdirectors and board of supervisors of the listed company by Wansheng Industrial, the net profit of the listedcompany shall not be less than RMB 30 million yuan, 35 million yuan and 40 million yuan, that is, thecumulative net profit scale is 105 million yuan. If the cumulative actual net profit of the listed company as ofany year during the performance commitment period does not reach the promised cumulative net profit,Wansheng Industrial shall compensate the listed company in cash within 10 working days after the issuance ofthe audit report of the listed company in the year during the performance commitment period. The amount ofcompensation payable for the year is calculated as follows: amount of compensation payable for the year =cumulative committed net profit as of the end of the period minus cumulative realized net profit as of the end ofthe period minus cumulative compensation amount (if any). The net profit attributable to the owners of theparent company in 2023 is RMB17,901,900 and the actual completion islower than the performancecommitment of RMB30 million, with a performance commitment completion rate of 59.67%. WanshengIndustrial has not fulfilled its 2023 annual performance commitment, and the cumulative net profit attributableto the owners of the parent company during the performance commitment period is still in the process of beingfulfilled.
8.Other
Nil
XV. Share-based payment
1. General share-based payment
□Applicable ?Not applicable
2. Share-based payment settled by equity
□Applicable ?Not applicable
3. Share-based payment settled by cash
□Applicable ?Not applicable
4.The current shares will pay the fee
□Applicable ?Not applicable
5. Revised and termination on share-based payment
Nil
6. Other
NilXVI. Commitment or contingency
1. Important commitments
Important commitments in balance sheet dateNil
2. Contingency
(1) Contingency on balance sheet date
Nil
(2) For the important contingency not necessary to disclosed by the Company, explained reasonsThe Company has no important contingency that need to disclosed
3.Other
NilXVII. Events after balance sheet date
1. Important non-adjustment items
In RMB
| Item | Content | Impact on financial status and operation results | Reasons on un-able to estimated the impact number |
2. Profit distribution
3. Sales return
Nil
4. Other events after balance sheet date
NilXVIII. Other important events
1. Previous accounting errors collection
(1) Retrospective restatement
In RMB
| Correction content | Treatment procedures | Impact items of statement during a comparison | Cumulative impacted number |
(2) Prospective application
| Correction content | Approval procedures | Reasons for prospective application adopted |
2. Debt restructuring
Nil
3. Assets replacement
(1) Non-monetary assets change
Nil
(2) Other assets replacement
Nil
4. Pension plan
Nil
5. Discontinued operations
In RMB
| Item | Revenue | Expenses | Total profit | Income tax expense | Net profit | Discontinued operations profit attributable to owners of parent company |
Other note:
Nil
6. Segment
(1) Recognition basis and accounting policy for reportable segment
The Company determines its business segments based on its internal organizational structure,management requirements, and internal reporting system. The Company's business segments are those that meetthe following conditions at the same time:
(1) The component is capable of generating income and incurring expenses in its daily activities;
(2) Management is able to regularly evaluate the operating results of the component in order to decide onthe allocation of resources to it and evaluate its performance;
(3) Able to obtain accounting information related to the financial position, results of operations and cashflows of the component.
The Company determines the reporting segment on the basis of the industry segment.
Segment reporting information is disclosed in accordance with the accounting policy and measurementstandards adopted by each segment in reporting to management, which are consistent with those at the time ofpreparation of the financial report.
(2) Financial information for reportable segment
In RMB
| Item | Gold jewelry | Bicycle | Lithium battery | Offset between segments | Total |
| Main business income | 564,839,114.22 | 916,243.42 | 806,397.39 | 566,561,755.03 | |
| Main business cost | 530,252,110.65 | 400,016.52 | 776,762.29 | 531,428,889.46 |
(3)The Company has no reportable segments, or unable to disclose total assets and total liability forreportable segments, explain reasonsNil
(4) Other note:
Nil
7. Major transaction and events makes influence on investor’s decision
Nil
8.Other
NilXIX. Principle notes of financial statements of parent company
1. Account receivable
（1）Disclosure according to the aging
In RMB
| Aging | Balance in year-end | Balance Year-beginning |
| Within one year(one year included) | 183,092,316.73 | 216,415,991.99 |
| 1-2 years | 6,441,479.72 | 11,003,540.60 |
| 2-3 years | 10,762,472.02 | 1,115,247.00 |
| Over 3 years | 2,412,925.00 | 1,347,678.00 |
| 3-4 years | 1,115,247.00 | 999,542.00 |
| 4-5 years | 949,542.00 | 348,136.00 |
| Over 5 years | 348,136.00 | |
| Total | 202,709,193.47 | 229,882,457.59 |
（2） According to the bad debt provision method classification disclosure
In RMB
| Category | Amount in year-end | Balance Year-beginning | ||||||||
| Book Balance | Bad debt provision | Book value | Book Balance | Bad debt provision | Book value | |||||
| Amount | Proportion(%) | Amount | Proportion(%) | Amount | Proportion(%) | Amount | Proportion(%) | |||
| Accrual of bad debt provision by single | 18,761,837.03 | 926.00% | 17,038,183.74 | 9,081.00% | 1,723,653.29 | 18,895,905.41 | 822.00% | 15,489,402.18 | 8,197.00% | 3,406,503.23 |
| Including： | ||||||||||
| Single identification | 18,761,837.03 | 926.00% | 17,038,183.74 | 9,081.00% | 1,723,653.29 | 18,895,905.41 | 822.00% | 15,489,402.18 | 8,197.00% | 3,406,503.23 |
| Accrual of bad debt provision by portfolio | 183,947,356.44 | 9,074.00% | 549,240.50 | 30.00% | 183,398,115.94 | 210,986,552.18 | 9,178.00% | 630,160.08 | 30.00% | 210,356,392.10 |
| Including： | ||||||||||
| Aging | 183,080, | 9,032.00 | 549,240. | 30.00% | 182,530, | 210,053, | 9,137.00 | 630,160. | 30.00% | 209,423, |
| portfolio | 166.53 | % | 50 | 926.03 | 360.30 | % | 08 | 200.22 | ||
| Related party Portfolio | 867,189.91 | 43.00% | 867,189.91 | 933,191.88 | 41.00% | 933,191.88 | ||||
| Total | 202,709,193.47 | 10,000.00% | 17,587,424.24 | 868.00% | 185,121,769.23 | 229,882,457.59 | 10,000.00% | 16,119,562.26 | 701.00% | 213,762,895.33 |
Bad debt provision accrual on single basis: Single identification
In RMB
| Name | Opening balance | Ending balance | ||||
| Book balance | Bad debt provision | Book balance | Bad debt provision | Accrual ratio | Reason for accrual | |
| Guangshui Jiaxu Energy Technology Co., Ltd. | 15,780,156.69 | 12,624,125.35 | 15,937,156.89 | 14,343,441.20 | 90.00% | Expected to be difficult to recover |
| Suzhou Jiaxin Economic Trade Co., Ltd. | 888,757.00 | 888,757.00 | 888,757.00 | 888,757.00 | 100.00% | Expected to be difficult to recover |
| Suzhou Daming Vehicle Industry Co., Ltd. | 649,688.00 | 519,750.40 | 649,688.00 | 519,750.40 | 80.00% | Expected to be difficult to recover |
| Dongguan Daxiang New Energy Co., Ltd. | 676,734.00 | 676,734.00 | 626,734.00 | 626,734.00 | 100.00% | Expected to be difficult to recover |
| Guangdong Xinlingjia New Energy Co., Ltd. | 348,136.00 | 348,136.00 | 348,136.00 | 348,136.00 | 100.00% | Expected to be difficult to recover |
| Hubei Tesidun Electric Technology Co., Ltd. | 241,068.58 | 120,534.29 | Expected to be difficult to recover | |||
| Tianjin Huiju Electric Vehicle Co., Ltd. | 116,840.14 | 116,840.14 | 116,840.14 | 116,840.14 | 100.00% | Expected to be difficult to recover |
| Other | 194,525.00 | 194,525.00 | 194,525.00 | 194,525.00 | 100.00% | Expected to be difficult to recover |
| Total | 18,895,905.41 | 15,489,402.18 | 18,761,837.03 | 17,038,183.74 | ||
Bad debt provision accrual on portfolio: Aging portfolio
In RMB
| Name of the Company | Ending balance | ||
| Book balance | Bad debt provision | Accrual ratio | |
| Within 1 year | 182,935,316.53 | 548,805.95 | 0.30% |
| 1-2 years | 144,850.00 | 434.55 | 0.30% |
| Total | 183,080,166.53 | 549,240.50 | |
Explanation on portfolio basis:
Nil
Bad debt provision accrual on portfolio: Related party Portfolio
In RMB
| Name | Ending balance | ||
| Book Balance | Bad debt provision | Proportion(%) | |
| Related party Portfolio | 867,189.91 | ||
| Total | 867,189.91 | ||
Explanation on portfolio basis:
NilIf the provision for bad debts of account receivable is made in accordance with the general model of expectedcredit losses, please refer to the disclosure of other account receivable to disclose related information about bad-debt provisions:
□Applicable?Not applicable
(3) Bad debt provision accrual, collected or reversal in the period
Accrual of bad debt provision in the period:
In RMB
| Category | Opening balance | Current changes | Ending balance | |||
| Accrual | Collected or reversal | Write off | Other | |||
| Accounts receivable with individual provision for bad debts | 15,489,402.18 | 1,719,315.85 | 170,534.29 | 17,038,183.74 | ||
| Provision for bad debts based on a portfolio of credit risk characteristics | 630,160.08 | 80,919.58 | 549,240.50 | |||
| Total | 16,119,562.26 | 1,719,315.85 | 251,453.87 | 17,587,424.24 | ||
Including important amount of bad debt provision collected or reversal in the period:
In RMB
| Name of the organization | Amount recovered or reversed | Reason for reversal | Recovery method | The basis and rationality for determining the provision ratio of original bad debt provision |
Nil
(4) Account receivables actually write-off during the reporting period
In RMB
| Item | Amount written off |
Including major account receivables write-off:
InRMB
| Enterprise | Nature | Amount written off | Causes | Procedure | Amount cause by related transactions or not (Y/N) |
Explanation on account receivable write-off:
Nil
(5) The top five accounts receivable and contract assets at the end of the period aggregated according todebtor
In RMB
| Name of the organization | Ending balance of accounts receivable | Ending balance of contract assets | Ending balance of accounts receivable and contract assets | Proportion to the total ending balance of accounts receivable and contract assets | Ending balance of accounts receivable bad debt provision and contract asset impairment provision |
| Fuzhou Rongrun Jewelry Co., Ltd | 41,195,292.62 | 0.00 | 41,195,292.62 | 20.32% | 123,585.88 |
| Shenzhen Yunshang Jewelry Co., Ltd | 32,872,394.98 | 0.00 | 32,872,394.98 | 16.22% | 98,617.18 |
| Shenzhen Hualinglong Jewelry Culture Technology Co., Ltd | 32,721,311.57 | 0.00 | 32,721,311.57 | 16.14% | 98,163.93 |
| GuangshuiJiaxu Energy Technology Co., Ltd | 20,097,682.89 | 0.00 | 20,097,682.89 | 9.91% | 60,293.05 |
| Fuzhou Cangshan District Dingjue Jewelry Company | 19,635,634.47 | 0.00 | 19,635,634.47 | 9.69% | 58,906.90 |
| Total | 146,522,316.53 | 0.00 | 146,522,316.53 | 72.28% | 439,566.94 |
2. Other account receivable
In RMB
| Item | Ending balance | Opening balance |
| Other account receivable | 17,300,576.60 | 209,606.79 |
| Total | 17,300,576.60 | 209,606.79 |
(1) Interest receivable
1) Category
In RMB
| Item | Ending balance | Opening balance |
2) Important overdue interest
In RMB
| Borrower | Ending balance | Overdue time | Overdue reason | Impairment (Y/N) and judgment basis |
Other note:
Nil
3) Accrual of bad debt provision
□Applicable ?Not applicable
4） Bad debt provision accrual, collected or reversal in the period
In RMB
| Category | Opening balance | Current changes | Ending balance | |||
| Accrual | Collected or reversal | Write off | Other | |||
Including important amount of bad debt provision collected or reversal in the period:
In RMB
| Name of the organization | Amount recovered or reversed | Reason for reversal | Recovery method | The basis and rationality for determining the provision ratio of original bad debt provision |
Other note:
Nil
5）Interest receivables actually written off in the current period
In RMB
| Item | Write-off amount |
Important Interest receivables write-off status thereinto:
In RMB
| Name of | Amount Nature | Write-off amount | Write-off reason | Write-off | Whether the |
| Organization | procedures for fulfillment | payment is generated by a related party transaction |
Note：
NilOther note：
(2) Dividend receivable
1) Category
In RMB
| Item (or the invested entity) | Ending balance | Opening balance |
2) Important dividend receivable with over one year aged
In RMB
| Item (or the invested entity) | Ending balance | Account age | Causes of failure for collection | Impairment (Y/N) and judgment basis |
3) Accrual of bad debt provision
□Applicable ?Not applicable
4） Bad debt provision accrual, collected or reversal in the period
In RMB
| Category | Opening balance | Current changes | Ending balance | |||
| Accrual | Collected or reversal | Write off | Other | |||
Including important amount of bad debt provision collected or reversal in the period:
In RMB
| Name of the organization | Amount recovered or reversed | Reason for reversal | Recovery method | The basis and rationality for determining the provision ratio of original bad debt provision |
Other note：
Nil
5） Dividend receivables actually written off in the current period
In RMB
| Item | Write-off amount |
Important Dividend receivable write-off status thereinto:
In RMB
| Name of Organization | Amount Nature | Write-off amount | Write-off reason | Write-off procedures for fulfillment | Whether the payment is generated by a related party transaction |
Note：
NilOther note：
（3）Other account receivable
1) By nature
In RMB
| Nature | Ending book balance | Opening book balance |
| Performance compensation | 12,098,051.76 | |
| Deposit or margin | 9,609.80 | 70,963.00 |
| Personal loan of employees | 20,198.00 | |
| Payment for equipment | 11,400.00 | 11,400.00 |
| Current account | 5,193,843.90 | |
| Other | 119,576.50 | |
| Total | 17,312,905.46 | 222,137.50 |
2）By account aging
In RMB
| Aging | Ending book balance | Opening book balance |
| Within one year(one year included) | 63,480.70 | 139,574.50 |
| 1-2 years | 79,473.00 | |
| 2-3 years | 70,663.00 | |
| Over 3 years | 11,900.00 | 11,900.00 |
| Over 5 years | 11,900.00 | 11,900.00 |
| Total | 154,853.70 | 222,137.50 |
3) According to the bad debt provision method classification disclosure
In RMB
| Category | Amount in year-end | Balance Year-beginning | ||||||||
| Book Balance | Bad debt provision | Book value | Book Balance | Bad debt provision | Book value | |||||
| Amount | Proportion(%) | Amount | Proportion(%) | Amount | Proportion(%) | Amount | Proportion(%) | |||
| Including： | ||||||||||
| Accrual of bad debt provision by portfolio | 12,252,905.46 | 100.00% | 12,328.86 | 0.10% | 12,240,576.60 | 222,137.50 | 100.00% | 12,530.71 | 5.64% | 209,606.79 |
| Including： | ||||||||||
| Aging portfolio | 154,853.70 | 1.26% | 12,328.86 | 7.96% | 142,524.84 | 222,137.50 | 100.00% | 12,530.71 | 5.64% | 209,606.79 |
| Related party Portfolio | 17,158,051.76 | 99.11% | 17,158,051.76 | |||||||
| Total | 17,312,905.46 | 100.00% | 12,328.86 | 0.07% | 17,300,576.60 | 222,137.50 | 100.00% | 12,530.71 | 5.64% | 209,606.79 |
Bad debt provision accrual on portfolio: Aging portfolio
In RMB
| Name of the Company | Ending balance | ||
| Book balance | Bad debt provision | Accrual ratio | |
| Aging portfolio | 154,853.70 | 12,328.86 | 7.96% |
| Total | 154,853.70 | 12,328.86 | |
Explanation on portfolio basis:
NilBad debt provision accrual on portfolio: Related party Portfolio
In RMB
| Name of the Company | Ending balance | ||
| Book balance | Bad debt provision | Accrual ratio | |
| Related party Portfolio | 17,158,051.76 | ||
| Total | 17,158,051.76 | ||
Explanation on portfolio basis:
NilIf the provision for bad debts of account receivable is made in accordance with the general model of expectedcredit losses, please refer to the disclosure of other account receivable to disclose related information about bad-debt provisions:
□Applicable?Not applicable
Provision for bad debts is made according to the general model of expected credit losses
In RMB
| Bad debt provision | Phase I | Phase II | Phase III | Total |
| Expected credit losses over next 12 months | Expected credit losses for the entire duration (without credit impairment occurred) | Expected credit losses for the entire duration (with credit impairment occurred) | ||
| Balance on January 1, 2023 | 12,530.71 | 12,530.71 |
| January 1, 2023 balance in the current period | ||||
| Turn back in this period | 201.85 | 201.85 | ||
| Balance on December 31, 2023 | 12,328.86 | 12,328.86 |
The basis for the division of each stageand the proportion of bad debt provisionNilChange of book balance of loss provision with amount has major changes in the period
□Applicable ?Not applicable
4) Bad debt provision accrual, collected or reversal in the period
Accrual of bad debt provision in the period:
In RMB
| Category | Opening balance | Current changes | Ending balance | |||
| Accrual | Collected or reversal | Write off | Other | |||
| Provision for bad debts based on a portfolio of credit risk characteristics | 12,530.71 | 201.85 | 12,328.86 | |||
| Total | 12,530.71 | 201.85 | 12,328.86 | |||
Nil
Important amount of bad debt provision switch-back or collection in the period:
In RMB
| Name of the organization | Amount recovered or reversed | Reason for reversal | Recovery method | The basis and rationality for determining the provision ratio of original bad debt provision |
Nil
5) Other account receivables actually write-off during the reporting period
In RMB
| Item | Amount written off |
Including major other account receivables write-off:
In RMB
| Enterprise | Other Nature | Amount written | Causes | Procedure | Amount cause by |
| off | related transactions or not (Y/N) |
Other Explanation on account receivable write-off:
Nil
6) Top 5 other account receivable collected by arrears party at ending balance
In RMB
| Enterprise | Nature | Ending balance | Account age | Proportion in total other account receivables at period-end | Ending balance of bad bet provision |
| Wansheng Industry Holding（Shenzhen ）Co., Ltd. | Performance compensation | 12,098,051.76 | Within 1 year | 69.88% | |
| Fujian Huaxinbao Jewelry Co., Ltd. | Current account | 5,050,000.00 | Within 1 year | 29.17% | |
| Guangdong Shenzhen Luohu Court | Current account | 79,473.00 | 1-2 years | 0.46% | 238.42 |
| Hubei Guangshui Court | Current account | 52,816.00 | Within 1 year | 0.31% | 158.45 |
| Shenzhen Hongkang Instrument Technology Co., Ltd. | Payment for equipment | 11,400.00 | Over 5 years | 0.07% | 11,400.00 |
| Total | 17,291,740.76 | 99.89% | 11,796.87 |
7） Reported in other receivables due to centralized management of funds
Other note：
Nil
3. Long-term equity investment
In RMB
| Item | Ending balance | Opening balance | ||||
| Book balance | Impairment provision | Book value | Book balance | Impairment provision | Book value | |
| Investment for subsidiary | 120,510,379.73 | 120,510,379.73 | 19,960,379.73 | 19,960,379.73 | ||
| Total | 120,510,379.73 | 120,510,379.73 | 19,960,379.73 | 19,960,379.73 | ||
(1) Investment for subsidiary
In RMB
| The invested entity | Opening balance(Book value) | Opening balance of the impairment provision | Changes in the period (+, -) | Ending balance(Book value) | Ending balance of impairment provision | |||
| Additional investment | Capital reduction | Accrual of impairment provision | Other | |||||
| Shenzhen Emmelle Industrial Co., Ltd. | 10,379.73 | 10,379.73 | ||||||
| Shenzhen Xinsen Jewelry Gold Supply Chain Co., Ltd | 19,950,000.00 | 100,550,000.00 | 120,500,000.00 | |||||
| Total | 19,960,379.73 | 100,550,000.00 | 120,510,379.73 | |||||
(2) Investment for associates and joint venture
In RMB
| Funded enterprise | Opening balance(Book value) | Opening balance of the impairment provision | Changes in the period (+, -) | Ending balance(Book value) | Ending balance of impairment provision | |||||||
| Additional investment | Capital reduction | Investment gains recognized under equity | Other comprehensive income adjustment | Other equity change | Cash dividend or profit announced to issued | Accrual of impairment provision | Other | |||||
| I. Joint venture | ||||||||||||
| II. Associated enterprise | ||||||||||||
The recoverable amount is determined on the basis of the net amount of fair value less disposal costs
□Applicable ?Not applicable
The recoverable amount is determined by the present value of the projected future cash flows
□Applicable ?Not applicable
The reason for the obvious discrepancy between the foregoing information and the information used in theimpairment test of previous years or the external informationNilThe reason for the obvious discrepancy between the information used in the Company's impairment test inprevious years and the actual situation in the current yearNil
（3）Other note
Nil
4. Operation revenue and operation cost
In RMB
| Item | Current period incurred | Prior period incurred | ||
| Revenue | Cost | Revenue | Cost | |
| Main business | 234,106,758.36 | 214,006,598.41 | 266,611,588.18 | 253,367,696.62 |
| Other business | 614,445.35 | 412.04 | 630,341.33 | 120,908.75 |
| Total | 234,721,203.71 | 214,007,010.45 | 267,241,929.51 | 253,488,605.37 |
Breakdown of operating income and operating costs:
Inn RMB
| Contract type | 1# Division | 2# Division | Total | |||||
| Revenue | Cost | Revenue | Cost | Revenue | Cost | Revenue | Cost | |
| Business type | ||||||||
| Including： | ||||||||
| Classification by business area | ||||||||
| Including： | ||||||||
| Market or customer type | ||||||||
| Including: | ||||||||
| Contract type | ||||||||
| Including: | ||||||||
| Classification by time of goods transfer | ||||||||
| Including: | ||||||||
| Classificati | ||||||||
| on by contract duration | ||||||||
| Including: | ||||||||
| Classification by sales channel | ||||||||
| Including: | ||||||||
| Total |
Information related to performance obligations:
| Item | The time to fulfill the performance obligation | Important payment terms | The nature of the goods that the company promises to transfer | Whether it is the main responsible person | The expected refunds to customers borne by the company | The types of quality assurance provided by the company and related obligations |
Other noteNilInformation relating to the transaction price assigned to the remaining performance obligation:
The amount of income corresponding to the performance obligations that have been signed at the end of thisreporting period but have not yet been fulfilled or have not done with fulfillment is 0.00 yuan, among them,yuan of revenue is expected to be recognized in year, yuan of revenue is expected to be recognized in year, andyuan of revenue is expected to be recognized in year.Significant contract changes or significant transaction price adjustments
In RMB
| Item | Accounting treatment method | The impacted amount on revenue |
Other note：
Nil
5. Investment income
In RMB
| Item | Current period incurred | Prior period incurred |
6. Other
Nil
XX. Supplementary Information
1. Current non-recurring gains/losses
?Applicable □Not applicable
In RMB
| Item | Amount | Note |
| Non-current asset disposal gain/loss | -12,298.94 | |
| Government subsidy reckoned into current gains/losses (except for those with normal operation business concerned, and conform to the national policies & regulations and are continuously enjoyed at a fixed or quantitative basis according to certain standards) | 120,500.00 | |
| Switch-back of provision of impairment of account receivable which are treated with separate depreciation test | 193,430.29 | |
| Net amount of non-operating income and expense except the aforesaid items | -300,037.34 | |
| Other non-recurring Gains/loss items | 2,092.35 | |
| Less :Influenced amount of income tax | 210,783.69 | |
| Influenced amount of minor shareholders’ equity (after tax) | 384,638.54 | |
| Total | -591,735.87 | -- |
Details of other gains/losses items that meets the definition of non-recurring gains/losses:
□Applicable?Not applicable
There are no other gains/losses items that meet the definition of non-recurring gains/losses in the Company.Explain the items defined as recurring profit (gain)/loss according to the lists of extraordinary profit (gain)/lossin Q&A Announcement No.1 on Information Disclosure for Companies Offering Their Securities to the Public --- Extraordinary Profit/loss
□Applicable?Not applicable
2. Return on equity (ROE) and earnings per share (EPS)
| Profit as of reporting period | Weighted average ROE (%) | EPS（Yuan/share） | |
| EPS-basic | EPS-diluted | ||
| Net profit attributable to common shareholders of the Company | 6.22% | 0.0260 | 0.0260 |
| Net profit attributable to common shareholders of the Company after deduction of non-recurring profit and loss | 6.43% | 0.0268 | 0.0268 |
3. Differences between accounting data under domestic and overseas accounting standards
（1）Simultaneously pursuant to both Chinese accounting standards and international accounting
standards disclosed in the financial reports of differences in net income and net assets.
□ Applicable□√ Not applicable
（2）. Differences of net profit and net assets disclosed in financial reports prepared under overseas andChinese accounting standards.
□ Applicable□√ Not applicable
(3) .Explanation of the reasons for the differences in accounting data under domestic and foreign accounting standards. If the data that has been audited by an overseas audit institution is adjusted for differences,the name of the overseas institution should be indicated
4.Other
Nil
Board of Directors of Shenzhen China Bicycle Company (Holdings) Co., Ltd.
April 19,2024