China Fangda Group Co., Ltd.
2020 Interim Report
August 2020
Chapter I Important Statement, Table of Contents and Definitions
The members of the Board and the Company guarantee that the interimreport is free from any false information, misleading statement or materialomission and are jointly and severally liable for the information’s truthfulness,accuracy and integrity.
Mr. Xiong Jianming, the Chairman of Board, Mr. Lin Kebin, the ChiefFinancial Officer, and Mr. Wu Bohua, the manager of accounting departmentdeclare: the Financial Report carried in this report is authentic and completed.
All the Directors have attended the meeting of the board meeting at whichthis report was examined.
Forward-looking statements involved in this report including future plansdo not make any material promise to investors. Investors should pay attention toinvestment risks.
The Company has specified market, management and production andoperation risks in this report. Please review the 10. Risks Facing the Companyand Measures in Chapter 4 Operation Discussion and Analysis.
The Company will distribute no cash dividends or bonus shares and has noreserve capitalization plan.
Table of Contents
Chapter I Important Statement, Table of Contents and Definitions ...... 2
Chapter II About the Company and Financial Highlights ...... 6
Chapter III Business Introduction ...... 9
Chapter IV Operation Discussion and Analysis ...... 15
Chapter V Significant Events ...... 30
Chapter VI Changes in Share Capital and Shareholders ...... 39
Chapter VII Preferred Shares ...... 45
Chapter VIII Information about the Company’s Convertible Bonds ...... 46
Chapter IX Particulars about the Directors, Supervisors, and Senior Management ...... 47
Chapter X Information about the Company’s Securities ...... 49
Chapter XI Financial Statements ...... 50
Chapter XII Documents for Reference ...... 195
Definitions
| Terms | Refers to | Description |
| Fangda Group, company, the Company | Refers to | China Fangda Group Co., Ltd. |
| Articles of Association | Refers to | Articles of Association of China Fangda Group Co., Ltd. |
| Meeting of shareholders | Refers to | Meetings of shareholders of China Fangda Group Co., Ltd. |
| Board of Directors | Refers to | Board of Directors of China Fangda Group Co., Ltd. |
| Supervisory Committee | Refers to | Supervisory Committee of China Fangda Group Co., Ltd. |
| Banglin Technology | Refers to | Shenzhen Banglin Technologies Development Co., Ltd. |
| Shilihe Co. | Refers to | Gong Qing Cheng Shi Li He Investment Management Partnership Enterprise (limited partner) |
| Shengjiu Investment Ltd. | Refers to | Shengjiu Investment Ltd. |
| Fangda Jianke | Refers to | Shenzhen Fangda Jianke Group Co., Ltd. |
| Fangda Zhichuang | Refers to | Fangda Zhichuang Science and Technology Co., Ltd. |
| Fangda New Material | Refers to | Fangda New Materials (Jiangxi) Co., Ltd. |
| Fangda New Energy | Refers to | Shenzhen Fangda New Energy Co., Ltd. |
| Fangda Property | Refers to | Shenzhen Fangda Property Development Co., Ltd. |
| Chengdu Fangda | Refers to | Chengda Fangda Construction Technology Co., Ltd. |
| Dongguan New Material | Refers to | Dongguan Fangda New Material Co., Ltd. |
| Kechuangyuan Software | Refers to | Shenzhen Qianhai Kechuangyuan Software Co., Ltd. |
| Fangda Property Management | Refers to | Shenzhen Fangda Property Management Co., Ltd. |
| Jiangxi Property Development | Refers to | Fangda (Jiangxi) Property Development Co., Ltd. |
| Hongjun Investment Company | Refers to | Shenzhen Hongjun Investment Co., Ltd. |
| Fang Qingling | Refers to | Shanghai Fangda Qingling Technology Co., Ltd. |
| Fangda Cloud Rail | Refers to | Shenzhen Fangda Cloud Rail Technology Co., Ltd. |
| Fangda Australia Co., Ltd. | Refers to | Fangda Australia Pty Ltd |
| Zhichuang Technology Hong Kong | Refers to | Fangda Zhichuang Science and Technology (Hong Kong) Co., Ltd. |
| Shihui International | Refers to | Shihui International Holding Co., Ltd. |
| Fangda Southeast Asia | Refers to | Fangda Southeast Asia Co., Ltd. |
| Chengda Curtain Wall Company | Refers to | Chengda Fangda Curtain Wall Technology Co., Ltd. |
| Fangda Jianzhi | Refers to | Shanghai Fangda Jianzhi Technology Co., Ltd. |
| Jianke Hong Kong | Refers to | Fangda Jianke Hong Kong Co., Ltd. |
| Shenyang Fangda | Refers to | Shenyang Fangda Semi-conductor Lighting Co., Ltd. |
| Shenzhen Woke | Refers to | Shenzhen Woke Semi-conductor Lighting Co., Ltd. |
| SZSE | Refers to | Shenzhen Stock Exchange |
Chapter II About the Company and Financial Highlights
1. Company Profile
| Stock ID | Fangda Group, Fangda B | Stock code | 000055, 200055 |
| Modified stock ID (if any) | None | ||
| Stock Exchange | Shenzhen Stock Exchange | ||
| Chinese name | China Fangda Group Co., Ltd. | ||
| English name (if any) | Fangda Group | ||
| English name (if any) | CHINA FANGDA GROUP CO., LTD. | ||
| English abbreviation (if any) | CFGC | ||
| Legal representative | Xiong Jianming | ||
2. Contacts and liaisons
| Secretary of the Board | Representative of Stock Affairs | |
| PRINTED NAME | Xiao Yangjian | Guo Linchen |
| Address | 20F, Fangda Technology Building, Kejinan 12th Avenue, High-tech Zone, Hi-tech Park South Zone, Shenzhen, PR China. | 20F, Fangda Technology Building, Kejinan 12th Avenue, High-tech Zone, Hi-tech Park South Zone, Shenzhen, PR China. |
| Telephone | 86(755) 26788571 ext. 6622 | 86(755) 26788571 ext. 6622 |
| Fax | 86(755)26788353 | 86(755)26788353 |
| zqb@fangda.com | zqb@fangda.com |
3. Other Information
1. Liaison
Changes to the Company’s registration address, office address, post code, website or email during the report period
□ Applicable √ Inapplicable
Company’s registration address, office address, post code, website or email have not changed during the report period. See AnnualReport 2019 for details.
2. Information disclosure and inquiring
Changes to the information disclosure and inquiring place
□ Applicable √ Inapplicable
Please refer to the 2019 annual report for the newspapers and websites where the Company’s information is disclosed. The inquiry
address of the interim report has remained unchanged during the report period.
4. Financial Highlight
Whether the Company needs to make retroactive adjustment or restatement of financial data of previous years
□ Yes √ No
| This report period | Same period last year | Year-on-year change (%) | |
| Turnover (yuan) | 1,251,608,064.42 | 1,425,890,946.99 | -12.22% |
| Net profit attributable to shareholders of the listed company (yuan) | 146,839,884.57 | 128,581,755.01 | 14.20% |
| Net profit attributable to the shareholders of the listed company and after deducting of non-recurring gain/loss (RMB) | 146,292,847.94 | 113,377,064.06 | 29.03% |
| Net cash flow generated by business operation (RMB) | -136,985,479.40 | -372,725,003.11 | 63.25% |
| Basic earnings per share (yuan/share) | 0.13 | 0.11 | 18.18% |
| Diluted Earnings per share (yuan/share) | 0.13 | 0.11 | 18.18% |
| Weighted average net income/asset ratio | 2.81% | 2.55% | 0.26% |
| End of the report period | End of last year | Year-on-year change | |
| Total asset (RMB) | 11,481,781,127.67 | 11,369,964,580.11 | 0.98% |
| Net profit attributable to the shareholders of the listed company (RMB) | 5,176,776,062.41 | 5,182,795,079.67 | -0.12% |
In the current period, the net profit of the current period is increased by about RMB80,739,565.80 as a result of changes in theaccounting estimates of accounts receivable and the expected credit loss rate of contractual assets.
5. Differences in accounting data under domestic and foreign accounting standards
1. Differences in net profits and assets in financial statements disclosed according to the international andChinese account standards
□ Applicable √ Inapplicable
There is no difference in net profits and assets in financial statements disclosed according to the international and Chinese accountstandards during the report period.
2. Differences in net profits and assets in financial statements disclosed according to the overseas andChinese account standards
□ Applicable √ Inapplicable
There is no difference in net profits and assets in financial statements disclosed according to the international and Chinese accountstandards during the report period.
6. Accidental gain/loss item and amount
√ Applicable □ Inapplicable
In RMB
| Item | Amount | Notes |
| Non-current asset disposal gain/loss (including the write-off part for which assets impairment provision is made) | -1,981.72 | |
| Subsidies accounted into the current income account (except the government subsidy closely related to the enterprise’s business and based on unified national standard quota) | 3,564,328.35 | |
| Gain/loss from change of fair value of transactional financial asset and liabilities, and investment gains from disposal of transactional and derivative financial assets and liabilities and sellable financial assets, other than valid period value instruments related to the Company’s common businesses | 1,926,439.93 | |
| Gain/loss from commissioned loans | 397,420.84 | |
| Other non-business income and expenditures other than the above | -5,000,026.69 | |
| Less: Influenced amount of income tax | 339,144.08 | |
| Total | 547,036.63 | -- |
Explanation statement should be made for accidental gain/loss items defined and accidental gain/loss items defined as regulargain/loss items according to the Explanation Announcement of Information Disclosure No. 1 - Non-recurring gain/loss mentioned.
□ Applicable √ Inapplicable
No circumstance that should be defined as recurrent profit and loss according to Explanation Announcement of InformationDisclosure No. 1 - Non-recurring gain/loss occurs in the report period.
Chapter III Business Introduction
1. Major businesses of the Company during the report period
Headquartered in Nanshan District, Shenzhen, the Company's main businesses include high-end curtain systems and materials,rail transport screen doors, new energy, and real estate development. The Company adheres to the spirit of ―Fangda Quality‖ withexcellence and quality first, and with the core competitiveness of product quality, technical strength and brand influence to providehigh-quality products and services in the relevant industries. Currently, five major business subsidiaries of the Company are nationalhigh-tech enterprises with modern production bases in Shanghai, Chengdu, Nanchang, and Dongguan. The Company was engaged inthe following businesses in the report period.
1. High-end curtain wall system and material business:
(1) Main products and purpose
The Company’s main products include energy-saving curtain walls, photo-electricity curtain walls, LED color-display curtainwalls, PVDF aluminum plate, graphene aluminum plate, and Nano aluminum plate materials. Construction curtain walls are mainlyused on high-level buildings (such as information centers, data centers, technology industry headquarters, R&D centers, officebuildings, etc.), large-area public venues such as airports, stations, cultural centers and exhibition centers, daylighting roof, shapedconstruction (ball-shaped and clock-shaped buildings) and buildings with peripheral protection, energy saving, environmentalprotection and decoration functions.
(2) Macroeconomic situation of the industry, the impact of changes in the industrial policy environment on theCompany, and the countermeasures taken by the Company
The emerging new epidemic has an inevitable impact on China's economy in the medium and short term. However, China'seconomy has strong toughness, great potential and wide scope of circulation. During the two sessions this year, the country putforward the economic policy of "six stabilizes" and "six guarantees", which will bring more development opportunities to thedevelopment of the curtain wall and material industry by cultivating the economic growth point of the new industry and increasingthe investment in the new infrastructure. In 2020, it is the 40th anniversary of the establishment of Shenzhen Special Economic Zone.It is the year for the construction of Guangdong, Hong Kong, Macau and Shenzhen to spread out and push forward the constructionof socialism with Chinese characteristics in an all-round way. The "chemical effect" and "multiplier effect" will be released in a newera of the "two zones" drive force. Shenzhen, as an important curtain wall market of the company, will also take full advantage of theunique advantages of Guangdong, Hong Kong and Macao Great Bay, reform and opening-up demonstration area, in order to furtherconsolidate and increase market share.
In the future, the company will focus on resources and advantages to further expand the competitive domestic market of "homedoor" such as Guangdong, Hong Kong, Macao, Macau, Changjiang and Chengdu-Chongqing. At the same time, it will take accountof overseas market, set up long-term development mechanism of team, continuously promote brand image, focus on key customers,enrich quality resources, establish strategic alliance with excellent enterprises, increase investment in software and hardware,promote the construction of intelligent factory, it will bring advanced science technology, such as AR, 5G, AI, VR, big data and so oninto production and management, abandon manpower tactics, reduce production costs, reduce labor costs, improve product qualityand enterprise benefits, form a new business pattern with big and international cycle, promote each other, maintain sustainabledevelopment.
(3) Main business modes, specific risks and changes;
The high-end curtain wall projects implemented by the Company are mainly through the bidding method to obtain contractorders. Project design, material procurement, production and processing, and the construction and installation and after-sales servicemodel are based on the contract orders. The main risk of this mode is that it takes a long period of time from the completion of the
order to the completion of the project, and it is highly dependent on raw materials and labor costs. It is greatly affected by thenational industrial policy, raw material prices, and labor market fluctuations. Different contract orders have different requirements,imposing high requirements on technology and production management. The main business model of the Company's curtain wallengineering is the entire industry chain, from design, process, material procurement, production and processing, to construction andafter-sales service. The curtain wall project of the company adopts the technology of standard design, factory production andassemble construction, which has the advantages of good construction quality, high installation precision and green environmentprotection. It solves the difficulties of traditional construction and reduces the manual dependence greatly.The operation mode remained unchanged in the report period.
(4) Market competition pattern, cyclical characteristics of the Company's industry and the Company's market positionAffected by the epidemic this year, with the increasing pressure of market competition, the industry has become more refinedand standardized. Small businesses with fragmented operations, unqualified and weak competitive ability have been eliminated bythe market, and market concentration has increased. The competition in the high-end market is dominated by the brand and strengthof the curtain wall enterprises, and requires the participating enterprises to have complete qualifications, large scale, advancedtechnology, standardized management and deep talent reserve, and gradually form a certain competition threshold. At the same time,the total number of employees in the curtain wall industry is declining, and the contradictions in human resources are moreprominent. It also puts forward more urgent needs for intelligent manufacturing and management tool applications. There is noobvious periodicity in the curtain wall industry.The Company is a pioneer and first listed company in this industry and has presided over and participated in the compilation ofmore than ten national or industry standards such as Design Standards for Energy Efficiency of Public Buildings. Over the past morethan 20 years, the Company has undertaken hundreds of large projects and received the highest award in the industry ChinaConstruction Luban Award and Zhan Tianyou Civil Engineering Award for many times. The Company has also received nearly 100provincial and above awards. The Company has been in the top 10 of ―China's top 100 building curtain wall industry‖ for many years,and has already had strong brand advantages and competitiveness in the industry. The Company has a strong technology lead in theindustry with 495 patents, including 57 intention patents and 11 software copyrights. The Company also made 9 records amongChinese enterprises. The Company has a Class A qualification for building curtain wall engineering contracting and class Aqualification for building curtain wall engineering design. It is the highest level for curtain wall design and construction companies inChina.
(5) Industry qualification types and validity period
During the reporting period, the company's relevant qualifications have not changed significantly, and the validity period hasnot expired.
| No. | Qualification | Effectiveness |
| 1 | Construction curtain wall designing class A | Until March 16, 2025 |
| 2 | Construction curtain wall contracting class A | Until February 3, 2021 |
| 3 | Construction decoration contracting class B | Until March 4, 2021 |
| 4 | Steel structure engineering contracting class B | Until March 4, 2021 |
| 5 | Construction mechanical and electric equipment installation contracting class C | Until March 4, 2021 |
| 6 | City and road lighting engineering contracting class C | Until March 4, 2021 |
(6) Quality control system, implementation standards, control measures and overall evaluation
Quality control system: The Company implements a comprehensive quality management system and has established a qualitymanagement system in accordance with ISO9001 from the aspects of design, procurement, storage, production, testing, delivery,installation, and after-sales service, and conduct regular reviews.
Implementation of the standard: In the process of building curtain wall business, the Company strictly complies withGB/T21086-2007 "Building Curtain Wall", JG/T231-2007 "Building Glass Lighting Roof" and other national and industrial
standards.
Control measures: The Company has established complete and effective quality control measures and quality managementbodies, and strictly implements various quality management and control measures.Overall evaluation: The Company's products and project quality are in full compliance with the relevant requirements of therelevant national standards and standards, and maintain proper operation, providing customers with stable and reliable qualityproducts and engineering.
(7) Major project quality problem during the reporting period
None.
2. Rail transport screen door business
The Company's main products in this sector are rail transport screen door systems and technical maintenance services, whichare a necessary part of modern urban rail transport system. It is installed at the edge of the subway platform and separates trains fromthe platform. The business model is to order-based production, obtain contract orders through bidding (divided into open bidding andbid invitation), design, process, purchase raw materials, factory production, construction and installation, and technical maintenanceservices according to the orders.
The Company has built a complete industry chain that integrates R&D, designing, production, installation engineering andafter-sales services. The business model has not changed during the reporting period. The Company has established a qualitymanagement system from design, procurement, production, installation and after-sales service in accordance with ISO9001, and haspassed ISO9001, ISO14000 and international railway IRIS system certification. The Company's rail transit shielding door systemadopts the original technology of the company and has the product with the independent intellectual property right. The company hascompiled the first industry standard of the rail transit station shielding door in our country and compiled the national standard ofevaluation method of energy consumption and emission index of urban rail transit (GB/T 37420-2019). At present, the Company has285 patents on subway shield doors, including 93 invention patents and 11 PCT patents. The total number of patents accounts for thelargest share of the industry in China. At the same time, it has 7 computer software copyrights. Fangda Zhichuang Technology Co.,Ltd. is engaged in the subway transportation shield door system industry as a state-level high-tech enterprise. The Fangda screen doorsystem with technical standards at the international advanced level has been used in rail transit in more than 40 cities around theworld. More than 10 million people use the Fangda screen door screen system every day, and the coverage rate in domestic metrooperating cities exceeds 80%. The market share ranks first in the world for many years.
3. New energy industry: Solar PV power generation industry is largely supported by the Chinese government. The Company isone of the first companies that possess intellectual property rights in the designing, production and integration of solar PV systems.The grid-connected Jiangxi Pingxiang Xuanfeng Town Solar Photovoltaic Power Station, Nanchang Jiangxi Isuzu Automobile Co.,Ltd. Parking Shade Photovoltaic Power Station and Dongguan Songshan Lake Photovoltaic Power Station all operated smoothly, andthe power generation efficiency was in line with the design. In 2020 H1, it achieved sales revenue growth of 28.90% over 2019 H1,and an operating profit growth of 74.67% over 2019 H1. It will continue to bring long-term and stable income and profits to thecompany in the future.
4. Real estate
The Company currently has one completed project: Fang Dacheng ("Fang Dacheng", the same below) project in NanshanDistrict, Shenzhen; one project under development: the Nanchang Phoenix Island Fangda Center project; Two: Fangda BangshenIndustrial Park project in Baoan District, Shenzhen, and urban renewal project in the area along the Dakang River in Henggang,Shenzhen.For a detailed discussion of the Company’s business, please refer to “III. Analysis of Core Competencies” in this sectionof the report and Chapter VI “Operation Discussion and Analysis”.
II. Major assets change
1. Major assets change
| Main assets | Major change |
| Equity assets | None |
| Fixed assets | None |
| Intangible assets | None |
| Construction in process | The construction in progress increased by 6.84% year-on-year, mainly due to the increased investment in the construction of the Shanghai East China Base project. |
| Investment real estate | None |
2. Major foreign assets
□ Applicable √ Inapplicable
3 Core Competitiveness Analysis
(1) Curtain wall system and material
1. Expertise and brand competitiveness
As the world's leading high-end curtain wall system supplier and service provider, the company has rich industry experience,professional technical team and excellent construction team. It is an outstanding domestic curtain wall enterprise and has builtthousands of high-quality projects at home and abroad, winning widespread praise from all walks of life. The industry and targetmarket of the Company have high requirements for the performance of participating enterprises which has formed certain thresholds.Especially in the super high-rise buildings, large public buildings and special-shaped external maintenance structures, the companyhas rich experience in project implementation. It has established business contacts and cooperation with many large real estatedevelopment companies. The Company has a high reputation and strong market competitiveness.The Company has 495 patents (including 57 invention patents) and 11 software copyrights in the curtain wall system andmaterials industry which has created many firsts in the industry and is one of the high-end preferred brands in the Chinese curtainwall system materials industry. So far, four subsidiaries including Shenzhen Fangda Jianke Group Co., Ltd., Fangda New Material(Jiangxi) Co., Ltd., Dongguan Fangda New Material Co., Ltd., Chengdu Fangda Construction Technology Co., Ltd. have beenrecognized as hi-tech companies. FANGDA is a nationwide well-known trademark in China.
2. Focusing on the high-end market to edge out competitors
In the fierce market competition, the Company accurately positions the market in the field of high-end energy-saving curtainwall systems with high requirements for technology, service and management, and focuses its resources on high-end curtain wallprojects. Many of the curtain wall projects undertaken won the national "Luban Award", "Zhan Tianyou Civil Engineering Award","National Quality Engineering Award", "China Construction Engineering Decoration Award", "White Magnolia" Award and"Customer Satisfaction Project" awards, and Won the title of ―Top Ten Most Competitive in China's Curtain Wall Industry‖. TheCompany has built a leading brand and created a clear edge in the high-end curtain wall market.
3. Well-developed industry base landscape
Thanks to continued investment in facilities, the Company has established a national business landscape with Shenzhen as theheadquarters, Dongguan Songshanhu as the base in the southern China and overseas, Chengdu in the southwest and Shanghai and
Nanchang in the east. The Dongguan Songshanhu and Nanchang bases are the largest and most advanced curtain wall system andmaterial production bases in China and across the world, fueling the Company to increase its market share and competitiveness.
4. General solutions
The Company has integrated the design, production, management and engineering of curtain wall systems to enjoytechnological, cost, quality and service advantages.
5. Talent
The Company has trained a group of outstanding teams with strong marketing technical, management and financial experiencefrom a large number of project implementation experience. The core backbone personnel are stable, ensuring the execution ability oforders and bringing good user experience to customers.
6. Boost overseas market development to increase overseas orders
In recent years, the Company has increased its expansion in overseas markets and gradually expanded its influence in Australiaand Southeast Asia. Thanks to good product quality and contract performance, it has continuously won the trust of new and oldcustomers and more orders. The overseas market orders are growing steadily.
(2) Rail transport screen door business
1. National development strategy
In September 2019, the "Outline for the Construction of a Powerful Transportation Country" issued by the Central Committeeof the Communist Party of China and the State Council proposed that by 2035, a transportation powerhouse will be basicallycompleted, and a "national 123 travel transportation circle" will be basically formed (one hour commuting in urban areas, two hoursin urban areas, 3 hours coverage in major cities nationwide). According to statistics from the China Urban Rail Transit Association,as of June 30, 2020 , a total of 41 cities in mainland China have opened 6917.62 kilometers of urban rail transit operating lines. In2020 H1, the State Development and Reform Commission approved the addition of 272.54 km of urban rail transit routes, with anadditional investment of RMB230.615 billion. With the development of urbanization and population gathering in the central cities,China's urban rail transit will continue to grow in recent years. As the world's largest supplier of rail screen door systems, theCompany will also take full advantage of technologies, brands, services, etc. to further consolidate and improve the domestic marketshare, and vigorously expand overseas markets, especially the "Belt and Road" national market, to maintain overseas orders.Continuity and stability will allow the domestic and foreign markets to develop in a balanced manner and continue to ―lead‖ in therail transit industry.
2. Expertise competitiveness
Through continued independent innovation, the Company has developed the global leading metro screen door system with fullintellectual property right and broken the monopoly of overseas competitors. The Company has also compiled the Rail TransportStation Screen Door Standard, which is the first of its kind in China. The standard was implemented as a national standard on March1, 2007. As the first standard in the industry in China, the standard has played a key role in guiding the development of China’s railtransport screen door industry and enabled the Company a dominant lead in the industry. In 2019, following the editor-in-chief of theUrban Rail Transit Platform Screen Door, the Company once again participated in the preparation of the Urban Rail Transit EnergyConsumption and Emission Index Evaluation Method (GB / T 37420-2019) and officially implemented it on December 1, 2019,highlighting the Company's technical strength and long-term leader status in the field of urban rail transit. At present, the Companyhas 285 patents on subway shield doors, including 93 invention patents and 7 PCT patents. The total number of patents accounts formore than half of the industry in China. At the same time, it has 7 computer software copyrights. Fangda Zhichuang Technology Co.,Ltd. is engaged in the subway transportation shield door system industry as a state-level high-tech enterprise.
3. Brand competitiveness
So far, the Company has undertaken railway screen door projects in more than 40 cities including Hong Kong, Singapore,Kuala Lumpur of Malaysia, Noida of India and Bangkok of Thailand. The Fangda subway screen door system has grasped a leadingmarket share and established incomparable brand influence thanks to its patents, standard and maintenance services. The Companyhas become a leading railway screen door supplier in the world. FANGDA is a nationwide well-known trademark in China. The
Company has become a leading railway screen door supplier in the world.
4. Industry chain advantage
As the first company to enter the subway screen door industry in China, the Company's subway screen doors have reached tomore than 80% of the subway cities in China, and many domestic subway screen doors have entered the maintenance period. TheCompany actively expands its industrial chain and takes the lead in the domestic market to provide metro maintenance services. TheCompany has a natural advantage in this high-end service industry. Our screen door system are independently developed by us, thusenabling us to provide prompt, overall, effective and standard maintenance services for our customers without other third parties. Asmore and more subways are opened, the business volume will continue to increase.
(3) New energy industry
The new energy business mainly comprises solar power PV application, PV construction and LED industry.
1. Technical advantage
With more than ten years’ experience in developing solar energy PV power generating curtain wall technology, the Company isthe earliest company that masters the intelligent property right in the designing, production and integration of solar energy PV curtainwall systems and is a pioneer in the application of PV curtain wall technology.
2. Relation with other industries
Distributed solar power PV power generation is closely related to the Company’s existing businesses. Most distributed solarpower PV systems are closely related to construction. Moreover, the Company has more than 10 years' experience in electricalproduct integration. The Company also has more than 20 years’ experience in construction management and has the level-1construction curtain wall engineering qualification and electrical installation engineering qualification.
(4) Real Estate
1. The Company is committed to the Guangdong-Hong KongMacao Bay District, focusing on the development of urbanrenewal projects in the core area of Shenzhen. Benefiting from the continued positive economic growth of Shenzhen and the rapideconomic development, it is expected that the Company's real estate sales and property leasing will contribute profits to the company.
2. Although the company is a later comer in the industry, the Shenzhen Fangda Town project was quickly recognized by themarket and the sales rate was faster. At the same time, the Company has been rated as ―Shenzhen Real Estate Development IndustryDevelopment Potential Enterprise‖ by Shenzhen Housing Association for three consecutive years. In two consecutive years, it hasbeen awarded ―Shenzhen Real Estate Development Industry Brand Value Enterprise‖ with professional operations for commercialand property management.
Chapter IV Operation Discussion and Analysis
1. Summary
In 2020 H1, the COVID-19 epidemic has been rampant in the world. The epidemic abroad has not seen any turning point,social and economic industries have been greatly impacted, domestic and international economic negative growth, demand decline,which has brought great challenges to the company operation. Under the adverse circumstance, the Company always insists ongrasping epidemic prevention and control, grasping rework and production, marketing, sales, collection, cost control and otherproduction and operation work. Under the leadership of the board of directors, through the efforts of all the staff, the Companybasically completed the business target of 2020 H1. The order reserve, net profit and other important business indexes not only didnot decline, but also achieved a certain increase, which is very difficult.During the reporting period, the net profit attributed to the owner of the parent company was 14,8#*@$ million yuan, up 14.20%from the same period of the previous year, and the net profit attributed to the owner of the parent company after deducting thenon-recurrent profit and loss was 14,#*@$9 million yuan, up 29.03% from the same period of the previous year. The companyrealized 125,5#*@$ million yuan of operating income, which was affected by epidemic, which was 12.22% lower than the sameperiod in the previous year, but recovered strong in the second quarter. The company realized 83,#*@$4 million yuan of operatingincome in the second quarter, up 10.90% year-on-year. As of the end of the reporting period, the company's order reserve wasRMB4,808,923,100 (excluding real estate sales), an increase of 5.99% compared with the beginning of the year, which was 3.84times of the operating income in the first half of the year. Adequate order reserve provided a strong guarantee for the company'ssustainable development.At present and in the future, epidemic and economic situation are more uncertain. China is speeding up to form a newdevelopment pattern with domestic consumption cycle as the main body and domestic and international double cycle promoting eachother. The Company will make full use of the top brand advantages at home, rely more on scientific and technological innovation,empower advanced science and technology into production and operation, continuously improve product quality and enterprisebenefit, and maintain sustainable development of the company.
1. High-end curtain wall system and material business
In 2020, it is the 40th anniversary of the establishment of Shenzhen Special Economic Zone. It is the year for the constructionof Guangdong, Hong Kong, Macau and the Dabie District of Shenzhen to open and push forward the construction of socialism withChinese characteristics in an all-round way. In the new era of "double zone" good superposition and "double zone" driving force, thecompany firmly grasps the opportunity, makes full use of the advantages of Shenzhen in the core region of Guangdong, Hong Kongand Macao, adheres to the management concept of "technology-based, innovation-based", adheres to the spirit of "square craftsmen"with the best quality, technical strength and brand influence. During the reporting period, the Company successively won the bid orsigned contracts with Shenzhen CIMC Satellite Internet of Things Industrial Building, Shenzhen Chuangzhi Cloud City Phase III,Shenzhen Ruifeng Optoelectronic Building Project, Shenzhen Shenye Hetangling Garden, Guangzhou Vanke Expo Land No. 15,Dongguan Chang’an OPPO R&D Center Project, Tianhe Mingmen Hao Ting in Shantou City, Shanghai Qibao Vanke EcologicalBusiness District Commercial Office Project, Hangzhou Fantasia 360 Project, Nanjing Science and Technology Development IslandSouthern Primary School, Eco-Tech Island Northern Junior High School Project , Nanchang Xinli Times Square 2# Building,Kunming Jinmao Yiting Business Center, Chengdu Merchants Damofang 12# Building, Ningxia Baofeng Hospital and NursingHome Project, Geelong GMHBA Project in Australia, Rosella Project in Melbourne, Australia, Wills St Project in Melbourne,Australia, Thailand A large number of high-end curtain wall system and material projects such as the SAM project and the SaudiMetro FLASH bid section. The total amount of the winning bids and the newly signed orders was RMB1.499 billion, an increase of
27.25% over the same period last year. Among them, the Guangdong-Hong Kong-Macao Greater Bay Area project amounted to
RMB873 million, accounting for 58.24% of the aggregate. 2. In the reporting period, the curtain wall system and materials industryrealized operating income of RMB841,699,200, an increase of 16.29% over the same period of the previous year; the net profit wasRMB91,247,700, an increase of 88.56%; with a gross margin of 16.67%, up 0.89 percentages over the same period of last year; As ofthe end of the reporting period, the Company's curtain wall system and materials business orders reserve was RMB316,8661,400,which was 376% of the sales revenue of the curtain wall system and materials business in 2019 H1.In order to meet the increasing demand for orders, the Company started construction in 2019 and built a new production base inEast China in Shanghai Songjiang. It is planned to be put into use in the second half of the year. The base occupies 2.38 000 squaremeters and has a total construction area of about 43,000 square meters. After completion, the Company's curtain wall system andmaterials industry are formed with Shenzhen as the headquarters South China with Dongguan Songshan Lake and Foshan as the baseSouthwest China with Chengdu as the base East China with Shanghai and Central China with Nanchang. As the base of thenational industrial layout, it provides an important guarantee for improving market share and comprehensive competitiveness.During the reporting period, the company strengthened management innovation, through intelligent factory construction,technology innovation, marketing system reform, project refined management and other reform and innovation measures, began toput advanced science and technology into the enterprise work, abandon the human sea tactics, change production mode, optimizeproduction process, improve production efficiency, accelerate the company from "manufacturing" to "intellectual manufacturing". Itis expected that the first smart factory will be built at Dongguan Songshan Lake Base at the end of this year to the first half of nextyear.
2. Rail transport screen door business
Facing the severe test and complicated and changeable domestic and international environment brought by the new crownepidemic, the company successively won the contract with the market occupation rate, brand influence, patent possession quantity,standard formulation and maintenance professional service and other leading advantages such as Xi'an metro line 5 phase 2, Nanningcity rail transit line 5 phase 1 project (Guo Kai Avenue-Jin Qiao passenger station), Fuzhou rail transit line 5 and other shielding doorsystem project orders, Shenzhen metro lines 1, 2, 5, 11, Nanchang rail transit line 2, etc. By the end of the report period, undeliveredorders for screen doors are worth RMB1,640,261,600. 3. In the first quarter of 2020, the rail transit equipment industry realizedoperating income of RMB333,462,700, an increase of 68.47% over the same period of the previous year; the order reserve quantity is
4.92 times the operating income in the first half of the year; the net profit was RMB58,581,900, an increase of 64.42% over the sameperiod of the previous year. The gross margin is 26.99%.
With the development of China ’s urban rail transit from scratch, from a single line to a network, and the end of the freemaintenance period for more and more rail transit screen doors, the demand for specialized technical maintenance services continuesto grow. In the reporting period, the company achieved technical maintenance service income of RMB15,274,000, an increase of
28.70% over the same period last year. The Company is a leading company that can provide the entire industry chain technology andproduct services for subway screen doors. The added value of technical services is high. In the future, this business will become animportant performance growth point for the company. The Company will also strive to become a metro screen door technologymaintenance service expert.
During the reporting period, Hangzhou Metro Line 16 and Shenyang Metro Line 10, equipped with Fangda screen door system,were put into operation successively. At present, Fangda Shielding Door System has been applied in 42 cities of the world. More than10 million people use Fangda Shielding Door System every day, maintaining the world's leading market share, and the city coveragerate of metro operation has reached over 80% in China. With the advanced original technology, independent brand and high qualityservice, Fangda Shielding Door System has promoted the rapid development of China's metro shielding door industry and establishedthe global leading position of China's rail transit shielding door equipment industry.
As the largest supplier of rail transit equipment products in the world, the company has won widespread praise for itshigh-quality and efficient professional maintenance services. During the reporting period, the company won the title of 2020 (13th)Rail Transit and City International Summit "Quality Supplier of Shielded Gate in 2019", Xiamen Rail Transit Group Co., Ltd."Advanced Subcontracting Maintenance Unit", Tianjin Rail Transit Group Co., Ltd. "Excellent Cooperative Subcontracting Unit",
Huhhot Metro Line 1 Construction Management Co., Ltd. "Excellent Supplier", Wuhan Wuhan Railway Traffic Media Co., Ltd."Excellent Subcontracting Maintenance Project". The recognition of the industry partners affirms the company's advancedtechnology and product quality in the field of urban rail transit shielding door equipment, and reflects Fangda's brand influence andmaintenance professional service in China's rail transit shielding door industry.
3. New energy industry
During the reporting period, the company's three solar photovoltaic power stations that have been connected to the grid havemaintained efficient, stable and safe operation. The annual sales revenue achieved an increase of 28.90% over 2019 H1, and theoperating profit achieved an increase of 74.67% over 2019 H1, exceeding expectations.
4. Real estate
(1) Property project development progress:
（1） Shenzhen Dacheng Project: The remaining small area of the project is to be sold. In the first half of the year, the tail salesbusiness is affected by epidemic. The Fangda Town project realizes the subscription sales area of 1,434.57 square meters and theremaining area to be sold is 6172.26 square meters. The renting rate of commercial part is 99.46%, the new renting area of officebuilding is 11,506.56 square meters, the renting rate is 48.50%.
（2） Nanchang Fangda Center: The project is located in the Fenghuangzhou District of the New District of Honggutan,Nanchang City. It covers a total area of 16,600 square metres and has a total building area of 66,432.61 square metres. It is a smalland medium-sized commercial complex integrated with office, apartment, shopping, leisure and entertainment. The project is mainlysold and leased, with a sales area of 32,460.11 square metres. It was pre-sold on 28 December 2019. The pre-sale area was 1,644.14square metres during the reporting period.
3. Shenzhen Fangda Bangshen Industrial Park: The project is located in Fuyong, Bao'an District, Shenzhen. It covers an area of20,714.9 square meters and is currently an industrial plant. The project was approved in July 2019. During the reporting period, thecompany is actively promoting the special plan of Fangda BongShen project.
(4) Urban renewal project along the Dagang River in Henggang, Shenzhen: The project is located in Dakang Village, YuanshanStreet, Longgang District, Shenzhen. The area of the project to be demolished is about 72,000 square meters. The update direction ismainly residential function, and finally subject to government approval. The Company is currently pushing forward the approvalprogress of the urban renovation project.
It is expected that the real estate sales and property leasing will continue to contribute profits to the Company in the future. Inorder to achieve its business objectives, the company will adhere to its strategic commitment, maintain a reasonable pace ofdevelopment, continue to increase sales efforts, strengthen sales receivables, rationally arrange financing, ensure the company is safeand sound, and strive to achieve the company's 2020 goals.
(2) New land reserve projects
| Parcel or project name | Land location | Purpose | Land area (m2) | Building area (m2) | Obtaining method | Interests percentage | Total land price (ten thousand yuan) | Equity consideration (ten thousand yuan) |
| None |
(3) Total land reserve
| Project/region name | Floor area (10,000 m2) | Total building area (10,000 m2) | Remaining building area (10,000 m2) |
| Fangda Town | 3.53 | 21.24 | 0 |
| Nanchang Fangda Center | 1.66 | 6.64 | 0 |
| Total | 5.19 | 27.88 | 0 |
(4) Main production development status
| City/region | Project | Land location | Project form | Interests percentage | Starting time | Development progress | Completion rate | Land area (m2) | Planning construction area (m2) | Area completed in this phase (m2) | Total area completed in this phase (m2) | Estimated total investment (in RMB10,000) | Accumulated total investment (in RMB10,000) |
| Honggutan New District, Nanchang | Fangda Center | No.1516 Ganjiang North Avenue Fangda Center | Commercial | 100.00% | 1 May 2018 | 62.00% | 62.00% | 16,608.55 | 66,432.61 | 0 | 0 | 67,000 | 41,336 |
(5) Main production sales status
| City/region | Project | Land location | Project form | Interests percentage | Building area (m2) | Sellable area (m2) | Cumulative pre-sale (sales) area (m2) | Pre-sale (sales) area in this period (m2) | Amount of pre-sale (sales) in the current period (RMB10,000) | Cumulative settlement area (m2) | Settlement area in the current period (m2) | Settlement amount in this period (RMB10,000) |
| Shenzhen Nanshan District | Fangda Town | No.2 Longzhu 4th Road | R&D office commercial complex | 100.00% | 212,400 | 93,086.25 | 85,479.42 | 85,479.42 | ||||
| Honggutan New District, Nanchang | Fangda Center | No.1516 Ganjiang North Avenue Fangda Center | Commercial | 100.00% | 65,388.42 | 32,460.11 | 1644.14 | 1644.14 | 2,301.87 | 1644.14 |
(6) Main production lease status
| Project | Land location | Project form | Interests percentage | Leasable area (m2) | Cumulative leased area (m2) | Average lease ratio |
| Shenzhen Fangda Town | Shenzhen Nanshan District | R&D office commercial complex | 100.00% | 72,517.71 | 35,168.44 | 48.50% |
| Shenzhen Fangda Town | Shenzhen Nanshan District | Commercial | 100.00% | 22,775.52 | 22,652.59 | 99.46% |
| Jiangxi Nanchang Science and Technology Park | Nanchang, Jiangxi Province | Plant and office building | 100.00% | 9,832.20 | 9,832.20 | 100.00% |
| Fangda Building | Shenzhen Nanshan District | R&D office building | 100.00% | 17,792.47 | 12,858.46 | 72.27% |
(7) First-level development of land
□ Applicable √ Inapplicable
(8) Financing source
| Financing source | Ending financing balance (in RMB10,000) | Financing cost range / average financing cost | Term structure | |||
| Within 1 year | 1-2 years | 2-3 years | Over 3 years | |||
| Bank loan | 118,000 | Based on LPR interest rate, the upper limit is 6.175% | 6,375.00 | 8,750.00 | 8,750.00 | 94,125.00 |
| Total | 118,000 | 6,375.00 | 8,750.00 | 8,750.00 | 94,125.00 | |
(9) Bank mortgage loan guarantee provided for commercial housing purchasers
√ Applicable □ Inapplicable
As of June 30, 2020, the balance of the Company's guarantee for commercial housing offenders due to bank mortgage loanswas RMB492,341,700.
(10) Co-investment by directors, senior management and supervisors and listed company
□ Applicable √ Inapplicable
2. Main business analysis
For details see Management Discussion and Analysis – 1. ProfileYear-on-year changes in major financial data
In RMB
| This report period | Same period last year | YOY change (%) | Reason | |
| Turnover | 1,251,608,064.42 | 1,425,890,946.99 | -12.22% | |
| Operation cost | 970,370,412.06 | 1,066,065,970.56 | -8.98% | |
| Sales expense | 20,978,235.09 | 27,175,638.50 | -22.80% | |
| Administrative expense | 62,559,463.16 | 82,678,777.56 | -24.33% | |
| Financial expenses | 44,884,568.71 | 49,481,340.36 | -9.29% | |
| Income tax expenses | 22,242,934.91 | 24,019,259.71 | -7.40% | |
| R&D investment | 51,599,310.87 | 14,702,673.12 | 250.95% | Mainly due to increased investment in research and development |
| Cash flow generated by | -136,985,479.40 | -372,725,003.11 | 63.25% | It is mainly due to the |
| business operations, net | increase in cash flow of operating activities due to the gradual recovery of mortgage bonds in the current period and the decrease in tax and expense. | |||
| Cash flow generated by investment activities, net | -67,239,474.99 | -579,720,478.07 | 88.40% | The net investment expenditure in the current period is mainly caused by the investment of the company's production base, fixed assets and investment real estate. |
| Net cash flow generated by financing activities | 89,832,186.57 | 376,629,126.62 | -76.15% | Mainly due to the increase in bank loans and the payment of cash dividends, and repurchase of B-shares in the current period. |
| Net increase in cash and cash equivalents | -113,108,512.86 | -576,045,363.83 | 80.36% | |
| Taxes and surcharges | 7,526,514.98 | 41,481,000.07 | -81.86% | Mainly due to the decrease in real estate income which is due to the decrease in provision of the land VAT. |
| Credit impairment ("-" for loss) | 74,854,185.26 | -4,369,660.38 | 1,813.04% | Mainly due to changes in accounting estimates for accounts receivable and expected credit loss rate of contract assets in the current period |
Major changes in profit composition or sources during the report period
□ Applicable √ Inapplicable
The profit composition or sources of the Company have remained largely unchanged during the report period.Turnover composition
In RMB
| This report period | Same period last year | YOY change (%) | |||
| Amount | Proportion in operating costs (%) | Amount | Proportion in operating costs (%) | ||
| Total turnover | 1,251,608,064.42 | 100% | 1,425,890,946.99 | 100% | -12.22% |
| Industry | |||||
| Metal production | 841,699,185.33 | 67.25% | 1,005,451,498.68 | 70.51% | -16.29% |
| Railroad industry | 333,462,675.90 | 26.64% | 197,936,254.53 | 13.88% | 68.47% |
| New energy industry | 9,727,737.59 | 0.78% | 7,546,757.83 | 0.53% | 28.90% |
| Real estate | 58,349,363.38 | 4.66% | 204,754,339.12 | 14.36% | -71.50% |
| Others | 8,369,102.22 | 0.67% | 10,202,096.83 | 0.72% | -17.97% |
| Product | |||||
| Curtain wall system and materials | 841,699,185.33 | 67.25% | 1,005,451,498.68 | 70.51% | -16.29% |
| Subway screen door and service | 333,462,675.90 | 26.64% | 197,936,254.53 | 13.88% | 68.47% |
| PV power generation products | 9,727,737.59 | 0.78% | 7,546,757.83 | 0.53% | 28.90% |
| Real estate sales | 58,349,363.38 | 4.66% | 204,754,339.12 | 14.36% | -71.50% |
| Others | 8,369,102.22 | 0.67% | 10,202,096.83 | 0.72% | -17.97% |
| District | |||||
| In China | 1,194,913,950.21 | 95.47% | 1,376,533,552.06 | 96.54% | -13.19% |
| Out of China | 56,694,114.21 | 4.53% | 49,357,394.93 | 3.46% | 14.86% |
(2) Industries, products or districts that take more than 10% of the Company’s business turnover or profit
√ Applicable □ Inapplicable
In RMB
| Turnover | Operation cost | Gross margin | Year-on-year change in operating revenue | Year-on-year change in operating costs | Year-on-year change in gross margin | |
| Industry | ||||||
| Metal production | 841,699,185.33 | 701,375,574.65 | 16.67% | -16.29% | -18.37% | 2.12% |
| Railroad industry | 333,462,675.90 | 243,449,579.62 | 26.99% | 68.47% | 70.82% | -1.01% |
| Real estate | 58,349,363.38 | 21,785,200.61 | 62.66% | -71.50% | -62.11% | -9.26% |
| Product | ||||||
| Metal production | 841,699,185.33 | 701,375,574.65 | 16.67% | -16.29% | -18.37% | 2.12% |
| Railroad industry | 333,462,675.90 | 243,449,579.62 | 26.99% | 68.47% | 70.82% | -1.01% |
| Real estate sales | 58,349,363.38 | 21,785,200.61 | 62.66% | -71.50% | -62.11% | -9.26% |
| District | ||||||
| In China | 1,194,913,950.21 | 932,671,017.14 | 21.95% | -13.19% | -9.51% | -3.17% |
Main business statistics adjusted in the recent one year with the statistics criteria adjusted in the report period
□ Applicable √ Inapplicable
Explanation for a year-on-year change of over 30%
√ Applicable □ Inapplicable
The operating revenue of the railway transportation industry in the current period rose year-on-year 68.47%. The operating revenueof real estate industry fell year-on-year 71.5% as the sales of major enterprises have come to an end, resulting in the decrease of realestate sales revenue in the current period.
3. Non-core business analysis
√ Applicable □ Inapplicable
In RMB
| Amount | Profit percentage | Reason | Whether continuous | |
| Investment income | -713,663.54 | -0.42% | No | |
| Gain/loss caused by changes in fair value | 9,107.28 | 0.01% | No | |
| Credit impairment loss | 74,854,185.26 | 44.28% | Provision for impairment of write-off receivables and contract assets | Yes |
| Non-operating revenue | 275,841.64 | 0.16% | No | |
| Non-business expenses | 5,275,868.33 | 3.12% | Donation of COVID-19 epidemic and precision poverty alleviation | No |
IV. Assets and Liabilities
1. Major changes in assets composition
In RMB
| End of the report period | Same period last year | Change (% ) | Notes | |||
| Amount | Proportion in total assets | Amount | Proportion in total assets | |||
| Monetary capital | 1,056,919,254.36 | 9.21% | 1,072,726,726.45 | 9.80% | -0.59% | |
| Account receivable | 564,418,018.59 | 4.92% | 2,118,904,495.79 | 19.37% | -14.45% | This is due to the classification of payments that have not yet reached the contract collection period into contract asset accounts according to the new income standards |
| Inventory | 779,903,495.46 | 6.79% | 750,395,540.06 | 6.86% | -0.07% | |
| Investment real estate | 5,517,829,915.07 | 48.06% | 5,285,303,323.58 | 48.31% | -0.25% | |
| Long-term share equity investment | 56,847,038.74 | 0.50% | 69,779,924.33 | 0.64% | -0.14% | |
| Fixed assets | 484,397,283.68 | 4.22% | 431,948,450.66 | 3.95% | 0.27% | |
| Construction in process | 138,881,024.27 | 1.21% | 90,993,650.25 | 0.83% | 0.38% | |
| Short-term loans | 1,280,635,666.66 | 11.15% | 900,000,000.00 | 8.23% | 2.92% | |
| Long-term loans | 1,151,161,462.35 | 10.03% | 593,978,153.39 | 5.43% | 4.60% | |
| Contract assets | 1,699,157,345.00 | 14.80% | 0.00 | 0.00% | 14.80% | This is due to the classification of payments that have not yet reached the contract collection period into contract asset accounts according to the new income standards |
| Other current assets | 329,749,353.10 | 2.87% | 114,294,388.81 | 1.04% | 1.83% | |
| Non-current liabilities due in 1 year | 151,617,767.59 | 1.32% | 800,000,000.00 | 7.31% | -5.99% | Repayment of long-term loans due within 1 year |
2. Assets and liabilities measured at fair value
√ Applicable □ Inapplicable
In RMB
| Item | Opening amount | Gain/loss caused by changes in fair value | Accumulative changes in fair value accounting into the income account | Impairment provided in the period | Amount purchased in the period | Amount sold in the period | Other change | Closing amount |
| Financial assets | ||||||||
| 1. Transactional | 10,330,062.18 | 2,226,413.78 | 2,337,919,965.42 | 2,332,471,104.66 | 18,005,336.72 | |||
| financial assets (excluding derivative financial assets) | ||||||||
| 2. Derivative financial assets | 1,815,676.34 | 176,453,070.00 | 83,087,985.00 | 1,815,676.34 | ||||
| 3. Investment in other equity tools | 20,660,181.44 | -520,143.59 | -15,271,813.35 | 20,140,037.85 | ||||
| Subtotal | 30,990,243.62 | 1,706,270.19 | -13,456,137.01 | 2,514,373,035.42 | 2,415,559,089.66 | 39,961,050.91 | ||
| Investment real estate | 5,306,116,360.12 | 11,675,404.61 | 5,919,471.95 | 5,312,035,832.07 | ||||
| Other non-current financial assets | 5,009,728.02 | 9,107.28 | 5,018,835.30 | |||||
| Total | 5,342,116,331.76 | 1,715,377.47 | -1,780,732.40 | 2,520,292,507.37 | 2,415,559,089.66 | 5,357,015,718.28 | ||
| Financial liabilities | 96,767.62 | 96,767.62 | 0.00 |
Other changeMajor changes in the assets measurement property of the Company in the report period
□ Yes √ No
3. Right restriction of assets at the end of the period
| Item | Closing book value | Reason |
| Monetary capital | 444,757,864.32 | Margin, pledged deposits, etc. |
| Inventory | 99,936,207.50 | Loan by pledge |
| Fixed assets | 64,242,861.97 | Loan by pledge |
| Intangible assets | 19,990,230.04 | Loan by pledge |
| 100% stake in Fangda Property Development held by the Company | 200,000,000.00 | Loan by pledge |
| Investment real estate | 2,803,546,306.33 | Loan by pledge |
| Other current assets | 201,790,136.99 | Pledge financing |
| Construction in process | 31,053,433.16 | Loan by pledge |
| Total | 3,865,317,040.31 |
VI. Investment
1. General situation
□ Applicable √ Inapplicable
2. Major equity investment in the report period
□ Applicable √ Inapplicable
3. Major non-equity investment in the report period
□ Applicable √ Inapplicable
4. Financial assets measured at fair value
√ Applicable □ Inapplicable
In RMB
| Assets category | Initial investment cost | Gain/loss caused by changes in fair value | Accumulative changes in fair value accounting into the income account | Amount in this period | Amount sold in this period | Total investment income | Closing amount | Capital source |
| Futures | 283,960.00 | 1,760,150.00 | 141,706,550.00 | 57,889,035.00 | -1,476,190.00 | 83,817,515.00 | Self-owned fund | |
| Derivative financial instrument | 21,659,950.00 | -156,787.17 | 152,293.96 | 34,746,520.00 | 25,198,950.00 | -309,081.13 | 31,207,520.00 | Self-owned fund |
| Others | 10,330,062.18 | 2,226,413.78 | 2,337,919,965.42 | 2,332,471,104.66 | 2,226,413.78 | 18,005,336.72 | Self-owned fund | |
| Total | 31,990,012.18 | 2,353,586.61 | 1,912,443.96 | 2,514,373,035.42 | 2,415,559,089.66 | 441,142.65 | 133,030,371.72 | -- |
5. Financial assets investment
(1) Securities investment
□ Applicable √ Inapplicable
The Company made no investment in securities in the report period
(2) Derivative investment
√ Applicable □ Inapplicable
In RMB10,000
| Derivative investment operator name | Relationship | Related transaction | Type | Initial amount | Start date | End date | Initial investment amount | Amount in this period | Amount sold in this period | Impairment provision (if any) | Closing investment amount | Proportion of closing investment amount in the closing net assets in the report period | Actual gain/loss in the report period |
| Shanghai Futures Exchange | No | No | Shanghai aluminum | 0 | 06 February 2020 | 30 June 2020 | 0 | 14,170.66 | 5,788.9 | 8,381.75 | 1.62% | -147.62 | |
| Banks | No | No | Forward foreign exchange | 2,166 | 2 August 2019 | 30 June 2020 | 2,166 | 3,474.65 | 2,519.9 | 3,120.75 | 0.60% | -30.91 | |
| Total | 2,166 | -- | -- | 2,166 | 17,645.31 | 8,308.8 | 0 | 11,502.5 | 2.22% | -178.53 | |||
| Capital source | Self-owned fund | ||||||||||||
| Lawsuit involved | None | ||||||||||||
| Disclosure date of derivative investment approval by the Board of Directors | 16 April 2020 | ||||||||||||
| Disclosure date of derivative investment approval by the shareholders’ meeting | None | ||||||||||||
| Risk analysis and control measures for the derivative holding in the report period (including without limitation market, liquidity, credit, operation and legal risks) | The company's aluminum futures hedging and foreign exchange derivatives trading business are all derivatives investment business. The company has established and implemented the "Derivatives Investment Business Management Measures" and "Commodity Futures Hedging Business Internal Control and Risk Management System". It has made clear regulations on the approval authority, business management, risk management, information disclosure and file management of derivatives trading business, which can effectively control | ||||||||||||
| the risk of the company's derivatives holding positions. | |
| Changes in the market price or fair value of the derivative in the report period, the analysis of the derivative’s fair value should disclose the method used and related assumptions and parameters. | Fair value of derivatives are measured at open prices in the open market |
| Material changes in the accounting policies and rules related to the derivative in the report period compared to last period | None |
| Opinions of independent directors on the Company’s derivative investment and risk controlling | None |
VI. Major assets and equity sales
1. Major assets sales
□ Applicable √ Inapplicable
The Company sold no assets in the report period.
2. Major equity sales
□ Applicable √ Inapplicable
VII. Analysis of major joint stock companies
√ Applicable □ Inapplicable
Major subsidiaries and joint stock companies affecting more than 10% of the Company’s net profit
In RMB
| Company | Type | Main business | Registered capital | Total assets | Net assets | Turnover | Operation profit | Net profit |
| Fangda Zhichuang | Subsidiaries | Subway screen door and service | 105,000,000.00 | 746,091,181.44 | 249,195,140.26 | 332,076,847.55 | 42,733,123.65 | 33,325,022.41 |
| Fangda Property | Subsidiaries | Real estate | 200,000,000.00 | 6,369,099,130.78 | 2,378,852,684.68 | 35,306,837.77 | 269,790.50 | 135,247.16 |
| Fangda Jianke | Subsidiaries | Curtain wall system and materials | 500,000,000.00 | 3,926,118,668.87 | 1,148,935,994.25 | 782,376,716.80 | 134,281,514.88 | 117,948,463.80 |
Acquisition and disposal of subsidiaries in the report period
√ Applicable □ Inapplicable
| Company | Acquisition and disposal of subsidiaries in the report period | Impacts on overall production, operation and performance |
| Fangda Jianke Hong Kong Co., Ltd. | Newly set | None |
Major joint-stock companiesIn this period, a newly established subsidiary indirectly controlled, namely Jianke Hong Kong Company, was newly added to theconsolidated statement of the current period.VIII. Structural entities controlled by the Company
□ Applicable √ Inapplicable
IX. Forecast of operating performance between January and September in 2020Warning and reasons of possible net loss or substantial change from the last period between the beginning of the year and the end ofthe next report period
□ Applicable √ Inapplicable
X. Risks facing the company and measures
1. Market risks and measures
The outbreak of the epidemic this year has caused a greater impact and impact on the market. As the overall designing andengineering quality continues improving in the domestic construction curtain wall industry, curtain wall products will becomeincreasingly standard, intensifying the market competition. In this regard, the company will continue to adopt a forward-looking andprudent operating policy, and achieve the goal of improving organizational efficiency and speeding up the return of funds throughrefined management and technological innovation. Improve product quality, reduce product costs through new technologies and newprocesses, flexibly respond to market changes, and improve the company's economic benefits.
2. Management risks and measures
In recent years, with the company's high-end curtain wall and material system industry, rail transit screen door industry ordersincreasing year by year and the company's real estate property sector increased, the company's assets, business, personnel and otheraspects have expanded significantly, the organizational structure and management system will tend to Due to the complexity, thecompany may face the management risk of industrial scale expansion. The Company will continue to improve the management mode,integrate business management, optimize the business flow, seeking to build a high-efficient and solid management team. We willintroduce high-quality, professional technical and management talents in different fields to strengthen the Company's corecompetitiveness.
3. Production and operation risks and measures
The macro-economy and market demand have added to the fluctuation in prices of main raw materials such as aluminum andsteel and labor, affecting the Company’s profitability and creating additional production and operation risks for the Company. TheCompany has sought to lower the purchase and production costs, increase technical R&D, reduce consumption of raw materials,introduce automatic and intelligent production equipment, strengthen staff training to improve working efficiency. At the same time,we will advance the construction of smart factories in an orderly manner, empower advanced science and technology into productionand operation, abandon human tactics, reduce manufacturing costs, reduce labor costs, and improve corporate efficiency.
4. Real estate industry risks and countermeasures
The real estate industry is obviously affected by the country 's macro-control, and the company needs to review the situation andfurther strengthen the forward-looking research on the economic situation, policies and industry situation, and the capital market,enhance predictive power, improve the control and resilience of risk factors, and timely adjust business strategies to adapt to the neweconomic normal and new changes in the real estate industry. At the same time, the company will increase its efforts to eliminate thecash and ensure that the company continues to maintain stable operation and healthy development by withdrawing cash.
Chapter V Significant Events
I. Annual and extraordinary shareholder meetings held during the report period
1. Annual shareholder meeting during the report period
| Meeting | Type | Participation of investors | Date | Date of disclosure | Index for information disclosure |
| 2019 Annual Shareholder Meeting | Annual shareholders’ meeting | 24.66% | 8 May 2020 | 09 May 2020 | Notice on Resolutions of the Annual Shareholders’ Meeting (2019) (2020-25) released on www.cninfo.com.cn |
2. Shareholders of preference shares of which voting right resume convening an extraordinaryshareholders’ meeting
□ Applicable √ Inapplicable
II. Profit Distribution and Reserve Capitalization in the Report Period
□ Applicable √ Inapplicable
The Company distributed no cash dividends or bonus shares and has no reserve capitalization plan.III. Commitments that have been fulfilled and not fulfilled by actual controller, shareholders,related parties, acquirers of the Company
□ Applicable √ Inapplicable
There is no commitment that has not been fulfilled by actual controller, shareholders, related parties, acquirers of the CompanyIV. Engaging and dismissing of CPAWhether the interim financial report is audited
□ Yes √ No
The interim report for H1 2015 has not been audited.V. Statement of the Board on the “non-standard auditors’ report” issued by the CPA on thecurrent report period
□ Applicable √ Inapplicable
VI. Statement of the Board of Directors on the Non-standard Auditor’s Report for H1 2014
□ Applicable √ Inapplicable
VII. Bankruptcy and capital reorganizing
□ Applicable √ Inapplicable
The Company has no bankruptcy or reorganization events in the report period.VIII. LawsuitSignificant lawsuit and arbitration
□ Applicable √ Inapplicable
The Company has no significant lawsuit or arbitration affair in the report period.Other lawsuit
√Applicable □ Inapplicable
As of the end of the reporting period, among thelitigation that has not been judged, the total litigation amount in which thecompanyand its subsidiaries serve as the plaintiff is RMB61,704,994.09, and that as the defendant is RMB136,435,911.84.IX. Media questioning
□ Applicable √ Inapplicable
The Company has no significant affair that arouses media questioning.X. Punishment and rectification
□ Applicable √ Inapplicable
The Company received no penalty and made no correction in the report period.XI. Credibility of the Company, controlling shareholder and actual controller
□ Applicable √ Inapplicable
XII. Share incentive schemes, staff shareholding program or other incentive plans
□ Applicable √ Inapplicable
There is no share incentive schemes, staff shareholding program or other incentive plans in the report period
XIII. Material related transactions
1. Related transactions related to routine operation
□ Applicable √ Inapplicable
The Company made no related transaction related to daily operating in the report period.
2. Related transactions related to assets transactions
□ Applicable √ Inapplicable
The Company made no related transaction of assets or equity requisition and sales in the report period.
3. Related transactions related to joint external investment
√ Applicable □ Inapplicable
| Co-investor | Relationship | Invested company | Main business of the invested company | Registered capital of the invested company | Total assets of the invested company (in RMB10,000) | Net assets of the invested company (in RMB10,000) | Net profit of the invested company (in RMB10,000) |
| Shenzhen Zhuo Shun Investment Co., Ltd. | A company controlled by Mr. Xiong Jianming, the actual controller, chairman and president of the company. | Shenzhen Lifu Investment Co., Ltd. (Proposed by the Board of Directors: Shenzhen Qianhai Investment Co., Ltd.) | Project investment, investment consultancy | RMB1 million | 250 | 250 | 0 |
| Progress of major construction projects in the invested enterprise (if any) | None | ||||||
4. Related credits and debts
□ Applicable √ Inapplicable
The Company had no related debt in the report period.
5. Other major related transactions
□ Applicable √ Inapplicable
The Company has no other significant related transaction in the report period.XIV. Non-operating capital use by the controlling shareholder or related parties in thereporting term
□ Applicable √ Inapplicable
The controlling shareholder and its affiliates occupied no capital for non-operating purpose of the Company during the report period.
XV. Significant contracts and performance
1. Asset entrusting, leasing, contracting
(1) Asset entrusting
□ Applicable √ Inapplicable
The Company made no custody in the report period.
(2) Contracting
□ Applicable √ Inapplicable
The Company made no contract in the report period
(3) Leasing
□ Applicable √ Inapplicable
LeasingThe company does not have a major lease contract.
2. Significant guarantee
√ Applicable □ Inapplicable
(1) Guarantee
In RMB10,000
| External guarantees made by the Company and subsidiaries (exclude those made for subsidiaries) | ||||||||
| Guarantee provided to | Date of disclosure | Guarantee amount | Actual date | Actual amount of guarantee | Type of guarantee | Term | Completed or not | Related party |
| None | ||||||||
| Guarantee provided to subsidiaries | ||||||||
| Guarantee provided to | Date of disclosure | Guarantee amount | Actual date | Actual amount of guarantee | Type of guarantee | Term | Completed or not | Related party |
| Fangda Jianke | 24 April 2018 | 30,000 | 28 August 2018 | 12,225.04 | Joint liability | since engage of contract to 2 years upon due of debt | No | Yes |
| Fangda Jianke | 30 January 2019 | 40,000 | 17 April 2019 | 17,280.75 | Joint liability | since engage of contract to 2 years upon due of debt | No | Yes |
| Fangda Jianke | 30 January 2019 | 30,000 | 1 August 2019 | 15,413.42 | Joint liability | since engage of contract to 2 years upon due of debt | No | Yes |
| Fangda Jianke, Zhichuang Company and the company | 30 January 2019 | 90,000 | 26 March 2019 | 28,545.48 | Joint liability | since engage of contract to 2 years upon due of debt | No | Yes |
| Fangda Jianke | 30 January 2019 | 25,000 | 20 August 2019 | 9,967.85 | Joint liability | since engage of contract to 2 years upon due of debt | No | Yes |
| Fangda Jianke and Zhichuang Company | 30 January 2019 | 14,000 | 18 December 2019 | 9,199.88 | Joint liability | since engage of contract to 2 years upon due of debt | No | Yes |
| Fangda Jianke | 30 January 2019 | 10,000 | 21 June 2019 | 3,300 | Joint liability | since engage of contract to 2 years upon due of debt | No | Yes |
| Fangda Zhichuang | 24 April 2018 | 21,600 | 6 August 2018 | 24,137.58 | Joint liability | since engage of contract to 2 years upon due of debt | No | Yes |
| Fangda Zhichuang | 30 January 2019 | 20,000 | 1 August 2019 | 5,560.87 | Joint liability | since engage of contract to 2 years upon due of debt | No | Yes |
| Fangda Zhichuang | 30 January 2019 | 15,000 | 27 May 2019 | 6,495.79 | Joint liability | since engage of contract to 2 years upon due of debt | No | Yes |
| Fangda Zhichuang | 18 April 2020 | 3,000 | 29 June 2020 | 3,000 | Joint liability | Three years from the effective date of the main contract to the expiry date of the debt performance period | No | Yes |
| Fangda New Material | 30 January 2019 | 8,000 | 24 April 2019 | 954.84 | Joint liability | since engage of contract to 2 years upon due of debt | No | Yes | |
| Fangda New Material | 18 April 2020 | 6,500 | 23 May 2020 | 1,783.67 | Joint liability | since engage of contract to 2 years upon due of debt | No | Yes | |
| Fangda Property | 30 November 2019 | 135,000 | 25 February 2020 | 99,000 | Joint liability | since engage of contract to 2 years upon due of debt | No | Yes | |
| Fangda Property | 30 January 2019 | 20,000 | 19 June 2019 | 19,000 | Joint liability | since engage of contract to 2 years upon due of debt | No | Yes | |
| Qingling Technology | 30 January 2019 | 8,000 | 10 July 2019 | 4,091.15 | Joint liability | since engage of contract to 2 years upon due of debt | No | Yes | |
| Total of guarantee to subsidiaries approved in the report term (B1) | 550,000 | Total of guarantee to subsidiaries actually occurred in the report term (B2) | 243,824.05 | ||||||
| Total of guarantee to subsidiaries approved as of the report term (B3) | 713,000 | Total of balance of guarantee actually provided to the subsidiaries as of end of report term (B4) | 259,956.32 | ||||||
| Guarantee provided to subsidiaries | |||||||||
| Guarantee provided to | Date of disclosure | Guarantee amount | Actual date | Actual amount of guarantee | Type of guarantee | Term | Completed or not | Related party | |
| Total of guarantee provided by the Company (total of the above three) | |||||||||
| Total of guarantee approved in the report term (A1+B1+C1) | 550,000 | Total of guarantee occurred in the report term (A2+B2+C2) | 243,824.05 | ||||||
| Total of guarantee approved as of end of report term (A3+B3+C3) | 713,000 | Total of guarantee occurred as of the end of report term (A4+B4+C4) | 259,956.32 | ||||||
| Percentage of the total guarantee occurred (A4+B4+C4) on net asset of the Company | 50.22% | ||||||||
| Including: | |||||||||
| Guarantees provided to the shareholders, substantial | 0.00 | ||||||||
| controllers and the related parties (D) | |
| Guarantee provided directly or indirectly to objects with over 70% of liability on asset ratio (E) | 19,000 |
| Amount of guarantee over 50% of the net asset (F) | 1,117.52 |
| Total of the above 3 (D+E+F) | 19,000 |
| Note of immature guarantee with guarantee liabilities or possible joint damage liabilities in the report period | None |
| Statement of external guarantees violating the procedure (if any) | None |
(2) Incompliant external guarantee
□ Applicable √ Inapplicable
The Company made no incompliant external guarantee in the report period.
3. Entrusted wealth management
√ Applicable □ Inapplicable
In RMB10,000
| Type | Source of fund | Amount | Undue balance | Due balance to be recovered |
| Bank financial products | Self-owned fund | 47,313.01 | 1,800.53 | 0 |
| Total | 47,313.01 | 1,800.53 | 0 | |
Specific circumstances of high-risk entrusted financing with large individual amount or low security, poor liquidity, and no costprotection
□ Applicable √ Inapplicable
Entrusted financial management expected to fail to recover the principal or likely result in impairment
□ Applicable √ Inapplicable
4. Other significant contract
□ Applicable √ Inapplicable
The Company entered into no other significant contract in the report.
XVI Social responsibilities
1. Environmental protection
Whether the Company and its subsidiaries are key polluting companies disclosed by the environmental protection authorityNoThe Company and its subsidiaries have earnestly implemented the Environmental Protection Law of the People's Republic of China,
the Law of the People's Republic of China on Water Pollution Prevention and Control, the Law of the People's Republic of China onthe Prevention and Control of Air Pollution, and the Law of the People's Republic of China on the Prevention and Control of SolidWaste Pollution. In the environmental protection laws and regulations, there were no penalties for violations of laws and regulationsduring the reporting period.
2. Performance of poverty relieving responsibilities
(1) Half-year poverty relieving summary
In the first half of 2020, the Company used funds for epidemic control and precision poverty alleviation projects ofRMB7,754,000 as follows:
In order to prevent and control the COVID-19 epidemic, the company supports the medical staff who are on the front line of theepidemic, respectively donating 2 million yuan to the Wuhan Red Cross Society and 1 million yuan to the Jiangxi Red CrossFoundation to purchase prevention and control materials and incentivize the frontline medical personnel;
2. To help the large tenants in Shenzhen, the company has reduced the rent by 2.52 million yuan.
3. Members and employees of the company organize to fight against epidemic and donate RMB120,500;
4. The Company donated 2 million yuan to the Jiangxi Red Cross Foundation to support poverty alleviation in Akto County,Xinjiang;
5. The company donated RMB1,000 to the Shenzhen Property Management Industry Committee of the Communist Party of Chinafor poverty alleviation in Guangdong Province;
6. The company donated mask 50,000 to Nanchang's Xinjian District, with a conversion fund of RMB112,500.
(2) Result of targeted poverty alleviation
| Specifications | Unit | Qty/Description |
| 1. General situation | —— | —— |
| Including: 1. capital | (in RMB10,000) | 764.15 |
| 2. Value of materials | (in RMB10,000) | 11.25 |
| II. Investment | —— | —— |
| 1. Industry development poverty relief | —— | —— |
| 2. Employment transfer | —— | —— |
| 3. Relocation | —— | —— |
| 4. Education | —— | —— |
| 5. Health care support | —— | —— |
| 6. Eco-protection support | —— | —— |
| 7. Last-line guarantee | —— | —— |
| 8. Social poverty relieving | —— | —— |
| 8.2 Targeted poverty alleviation investment amount | (in RMB10,000) | 200.10 |
| 9. Others | —— | —— |
| III. Prizes | —— | —— |
(3) Further property relief plans
The Company will continue to fulfill its social responsibility for precision poverty alleviation, and make donations from time to timebased on business development.XVII. Other material events
√ Applicable □ Inapplicable
At its second meeting, on 23 June 2020, the 9th Board of Directors of the Company considered and adopted the Company'sproposals on joint investment with affiliates and related transactions, on joint investment with controlling subsidiaries and on transferof shares in wholly owned subsidiaries. For details, see the Company's bulletins published on 24 June 2020 in the Securities Times,China Securities, Shanghai Securities, Hong Kong Commerce (English) and www.cninfo.com.cn (Notice No.: 2020-32, 2020-34,2020-35, 2020-36).
The progress of the above matters is as follows: the company's wholly-owned subsidiary Shenzhen Hongjun Investment Co.,Ltd., Shenzhen Fangda New Energy Co., Ltd. (funded by its wholly-owned subsidiary Shenzhen Xunfu Investment Co., Ltd.) andrelated parties Shenzhen Zhuo Shun Investment Co., Ltd. Co-funded and established Shenzhen Lifu Investment Co., Ltd. (the nameproposed by the board of directors: Shenzhen Qianhai Shengfa Investment Co., Ltd.), which has completed the industrial andcommercial registration procedures and obtained a business license; the company and its holding subsidiary Shenzhen LifuInvestment Co., Ltd. The company jointly funded the establishment of Shenzhen Fangda Investment Partnership (Limited Partnership)(the name proposed by the board of directors: Shenzhen Qianhai Fangda Investment Partnership (Limited Partnership)), which hascompleted the business registration procedures and obtained a business license.
To date, the company has fully received the share transfer transaction price paid by Shenzhen Fangda Zhixiang Technology Co.,Ltd., and has completed the registration procedure of the change of ownership transfer. Shenzhen Fangda Jianke Group Co., Ltd., asubsidiary of the company, has fully received the share transfer transaction price of Fangda Zhixiang Technology Co., Ltd., which ispaid by Fangda Zhixiang Technology Co., Ltd.
The joint investment and affiliated transaction between the company and its affiliates, joint investment partnership with holdingsubsidiaries and share transfer of wholly owned subsidiaries have been completed.XVIII. Material events of subsidiaries
□ Applicable √ Inapplicable
Chapter VI Changes in Share Capital and ShareholdersI. Changes in shares
1. Changes in shares
In share
| Before the change | Change (+,-) | After the change | |||||||
| Quantity | Proportion | Issued new shares | Bonus shares | Transferred from reserves | Others | Subtotal | Quantity | Proportion | |
| I. Shares with trade restriction conditions | 1,431,568 | 0.13% | 11,375 | 11,375 | 1,442,943 | 0.13% | |||
| 1. Other domestic shares | 1,431,568 | 0.13% | 11,375 | 11,375 | 1,442,943 | 0.13% | |||
| Domestic natural person shares | 1,431,568 | 0.13% | 11,375 | 11,375 | 1,442,943 | 0.13% | |||
| II. Shares without trading limited conditions | 1,121,952,621 | 99.87% | -35,116,613 | -35,116,613 | 1,086,836,008 | 99.87% | |||
| 1. Common shares in RMB | 678,283,904 | 60.38% | -11,375 | -11,375 | 678,272,529 | 62.33% | |||
| 2. Foreign shares in domestic market | 443,668,717 | 39.49% | -35,105,238 | -35,105,238 | 408,563,479 | 37.54% | |||
| III. Total of capital shares | 1,123,384,189 | 100.00% | -35,105,238 | -35,105,238 | 1,088,278,951 | 100.00% | |||
Reasons
√ Applicable □ Inapplicable
1. From April 3, 2020 to May 12, 2020, the company completed the repurchase of some domestically listed foreign shares (Bshares) in 2019 through centralized bidding, and the cumulative number of B shares repurchased without selling restrictions was35,105,238 On May 20, 2020, the Shenzhen Branch of China Securities Depository and Clearing Co., Ltd. completed the repurchaseand cancellation procedures. The unrestricted B shares decreased by 35,105,238 shares, and the total share capital decreased from1,123,384,189 shares to 1,088,278,951 shares.
2. Mr. Ye Zhiqing, the employee representative supervisor of the company, resigned on May 8, 2020. He holds 19,100 A sharesof the company, 14,325 shares subject to sales restrictions and 4,775 shares subject to restrictions on sales before he resigns. All theshares need to be locked within half a year after leaving office. Therefore, 4,775 shares of restricted shares were added, and 4,775shares of restricted shares were reduced.
3. Mr. Fan Xiaodong, a supervisor elected by the company’s 2019 annual general meeting on May 8, 2020, holds 8,800 A sharesof the company. Starting from May 11, 2020, 6,600 shares of which are subject to sales restrictions Regarding the locked shares,6,600 shares were added to the restricted shares and 6,600 shares were not restricted.
Approval of the change
√ Applicable □ Inapplicable
1. The company's 2019 repurchase of certain domestically listed foreign shares (B shares) related matters, respectively, onNovember 28, 2019, and December 16, 2019. The nineteenth meeting of the eighth board of directors and Deliberated and approvedat the first extraordinary general meeting of shareholders in 2019.
2. On May 8, 2020, Mr. Fan Xiaodong was elected as a supervisor at the company's 2019 annual general meeting.
Share transfer
√ Applicable □ Inapplicable
The company repurchased some 35,105,238 shares of domestically listed foreign shares (B shares) in 2019, and completed the sharerepurchase and cancellation procedures at the Shenzhen Branch of China Securities Depository and Clearing Corporation Limited onMay 20, 2020.
Progress in the implementation of share repurchase
√ Applicable □ Inapplicable
1. The company repurchased some 35,105,238 shares of domestically listed foreign shares (B shares) in 2019. The repurchaseand cancellation procedures were completed on May 20, 2020. For details, please refer to the company’s "About Repurchase ofShares" disclosed on May 22, 2020. Announcement of completion of cancellation."
2. The company's 2020 plan to repurchase some domestically listed foreign shares (B shares) has been reviewed and approvedat the second meeting of the company's ninth board of directors on June 23, 2020. According to the company's repurchase plan, thetotal amount of repurchase funds shall not exceed RMB 50 million (inclusive) (including foreign exchange, transaction fees and otherrelated expenses), and the price of the repurchased shares shall not exceed 3.47 Hong Kong dollars per share (inclusive). The upperlimit of the number of shares to be repurchased is 31.158 million shares, and the lower limit is 15.759 million shares. The specificnumber of shares to be repurchased is subject to the actual number of shares repurchased at the expiration of the repurchase period.The repurchased shares are planned to be cancelled. From the first share repurchase on July 23, 2020 to July 31, 2020, the companyrepurchased 882,062 shares of the company’s B shares through a centralized bidding transaction through the special securitiesrepurchase account, which accounted for the company’s total share capital of 0.08%, the highest transaction price was HKD
3.23/share, the lowest transaction price was HKD 3.16/share, and the total payment amount was HKD 2,826,839.44 (excludingtransaction fees). For the above content, please refer to the relevant announcements disclosed by the company on June 24, 2020, July24, 2020, and August 4, 2020.
Progress in the implementation of the reduction of shareholding shares by means of centralized bidding
□ Applicable √ Inapplicable
Impacts on financial indicators including basic and diluted earnings per share, net assets per share attributable to commonshareholders of the company in the most recent year and period
√ Applicable □ Inapplicable
| Item | 2019 | January to June, 2020 | |
| Before change | After change | ||
| Basic earnings per share | 0.31 | 0.32 | 0.13 |
| Diluted earnings per share | 0.31 | 0.32 | 0.13 |
| Net assets per share | 4.61 | 4.76 | 4.76 |
Others that need to be disclosed as required by the securities supervisor
□ Applicable √ Inapplicable
2. Changes in conditional shares
√ Applicable □ Inapplicable
In share
| Shareholder name | Conditional shares at beginning of the period | Released this period | Increased this period | Conditional shares at end of the period | Reason of condition | Date of releasing |
| Ye Zhiqing | 14,325 | 0 | 4,775 | 19,100 | Leaving office | 11 November 2020 |
| Fan Xiaodong | 0 | 0 | 6,600 | 6,600 | Newly elected supervisor | 25% of the annual shareholding is released from the sale |
| Total | 14,325 | 0 | 11,375 | 25,700 | -- | -- |
II. Share placing and listing
□ Applicable √ Inapplicable
III. Shareholders and shareholding
In share
| Number of shareholders of common shares at the end of the report period | 61,834 | Number of shareholders of preferred stocks of which voting rights recovered in the report period | 0 | |||||||
| Shareholders holding 5% of the Company's common shares or top-10 shareholders | ||||||||||
| Shareholder name | Nature of shareholder | Shareholding percentage | Number of common shares held at the end of the report period | Change in the reporting period | Conditional common shares | Unconditional common shares | Pledging or freezing | |||
| Share status | Quantity | |||||||||
| Shenzhen Banglin Technologies Development Co., Ltd. | Domestic non-state legal person | 10.55% | 114,847,854 | 5,200 | 114,847,854 | Pledged | 32,700,000 | |||
| Shengjiu Investment Ltd. | Foreign legal person | 9.57% | 104,127,479 | 433,450 | 104,127,479 | |||
| Fang Wei | Domestic natural person | 3.62% | 39,372,437 | 4,326,898 | 39,372,437 | |||
| Gong Qing Cheng Shi Li He Investment Management Partnership Enterprise (limited partner) | Domestic non-state legal person | 2.46% | 26,791,488 | - | 26,791,488 | |||
| VANGUARD TOTAL INTERNATIONAL STOCK INDEX FUND | Foreign legal person | 0.64% | 6,986,407 | 1,114,400 | 6,986,407 | |||
| VANGUARD EMERGING MARKETS STOCK INDEX FUND | Foreign legal person | 0.58% | 6,312,683 | -1,633,800 | 6,312,683 | |||
| Shenwan Hongyuan Securities (Hong Kong) Co., Ltd. | Foreign legal person | 0.52% | 5,705,823 | -1,925,473 | 5,705,823 | |||
| Qu Chunlin | Domestic natural person | 0.51% | 5,557,161 | 1,250,150 | 5,557,161 | |||
| Chen Sheng | Domestic natural person | 0.46% | 5,000,000 | 3,700,000 | 5,000,000 | |||
| First Shanghai Securities Limited | Foreign legal person | 0.36% | 3,938,704 | -63,000 | 3,938,704 | |||
| A strategic investor or ordinary legal person becomes the Top10 shareholder due a stock issue. | None | |||||||
| Notes to top ten shareholder relationship or "action in concert" | Among the shareholders, Shenzhen Banglin Technology Development Co., Ltd. and Shengjiu Investment Co., Ltd. are parties action-in-concert. Shenzhen Banglin Technology Development Co., Ltd. and Gong Qing Cheng Shi Li He Investment Management Partnership Enterprise are related parties. The Company is not notified of other action-in-concert or related parties among the other holders of current shares. | |||||||
| Top 10 shareholders of unconditional common shares | |||
| Shareholder name | Amount of common shares without sales restriction | Category of shares | |
| Category of shares | Quantity | ||
| Shenzhen Banglin Technologies Development Co., Ltd. | 114,847,854 | RMB common shares | 114,847,854 |
| Shengjiu Investment Ltd. | 104,127,479 | Foreign shares listed in domestic exchanges | 104,127,479 |
| Fang Wei | 39,372,437 | RMB common shares | 39,372,437 |
| Gong Qing Cheng Shi Li He Investment Management Partnership Enterprise (limited partner) | 26,791,488 | RMB common shares | 26,791,488 |
| VANGUARD TOTAL INTERNATIONAL STOCK INDEX FUND | 6,986,407 | Foreign shares listed in domestic exchanges | 6,986,407 |
| VANGUARD EMERGING MARKETS STOCK INDEX FUND | 6,312,683 | Foreign shares listed in domestic exchanges | 6,312,683 |
| Shenwan Hongyuan Securities (Hong Kong) Co., Ltd. | 5,705,823 | Foreign shares listed in domestic exchanges | 5,705,823 |
| Qu Chunlin | 5,557,161 | RMB common shares | 5,557,161 |
| Chen Sheng | 5,000,000 | RMB common shares | 5,000,000 |
| First Shanghai Securities Limited | 3,938,704 | Foreign shares listed in domestic exchanges | 3,938,704 |
| No action-in-concert or related parties among the top10 unconditional common share shareholders and between the top10 unconditional common share shareholders and the top10 common share shareholders | Among the shareholders, Shenzhen Banglin Technology Development Co., Ltd. and Shengjiu Investment Co., Ltd. are parties action-in-concert. Shenzhen Banglin Technology Development Co., Ltd. and Gong Qing Cheng Shi Li He Investment Management Partnership Enterprise are related parties. The Company is not notified of other action-in-concert or related parties among the other holders of current shares. | ||
| Top-10 common share shareholders participating in margin trade | Shenzhen Banglin Technology Development Co., Ltd. holds 55,000,000 shares of the company through the customer credit transaction guarantee securities account of Ping An | ||
Agreed re-purchasing by the Company’s top 10 shareholders of common shares and top 10 shareholders of unconditional commonshares in the report period
□ Yes √ No
No agreed re-purchasing by the Company’s top 10 shareholders of common shares and top 10 shareholders of unconditional commonshares in the report periodIV. Changes in controlling shareholder or actual controllerChanges in the controlling shareholder in the reporting period
□ Applicable √ Inapplicable
No change in the controlling shareholder in the report periodChange in the actual controller in the report period
□ Applicable √ Inapplicable
No change in the actual shareholder in the report period
Chapter VII Preferred Shares
□ Applicable √ Inapplicable
The Company had no preferred share in the report period.
Chapter VIII. Information about the Company’s Convertible Bonds
□ Applicable √ Inapplicable
No convertible bonds in the report period
Chapter IX Particulars about the Directors, Supervisors, and Senior
Management
I. Changes in shareholding of Directors, Supervisors and Senior Management
√ Applicable □ Inapplicable
| PRINTED NAME | Position | Job status | Number of shares held at beginning of the period | Increased shares in this period (share) | Decreased shares in this period (share) | Number of shares held at end of the period | Number of restricted shares granted at the beginning of the period | Number of restricted shares granted in this period | Number of restricted shares granted at the end of the period |
| Xiong Jianming | Chairman, president | In office | 1,889,657 | 1,889,657 | |||||
| Xiong Jianwei | Director | In office | |||||||
| Zhou Zhigang | Director, vice president | In office | |||||||
| Lin Kebin | Director, vice president | In office | |||||||
| Guo Jinlong | Independent director | In office | |||||||
| Huang Yaying | Independent director | In office | |||||||
| Cao Zhongxiong | Independent director | In office | |||||||
| Dong Gelin | Supervisory Committee meeting convener | In office | |||||||
| Cao Naisi | Supervisor | In office | |||||||
| Fan Xiaodong | Supervisor | In office | 8,800 | ||||||
| Wei Yuexing | Vice president | In office |
| Xiao Yangjian | Secretary of the Board | In office | |||||||
| Guo Wanda | Independent director | Resigned | |||||||
| Deng Lei | Independent director | Resigned | |||||||
| Ye Zhiqing | Supervisor | Resigned | 19,100 | 19,100 | |||||
| Total | -- | -- | 1,908,757 | 0 | 0 | 1,917,557 | 0 | 0 | 0 |
II. Changes in the Directors, Supervisors and Senior Executives
√ Applicable □ Inapplicable
| PRINTED NAME | Job | Type | DATE | Reason |
| Guo Wanda | Independent director | Leaving office | 8 May 2020 | Office term expires and re-elected |
| Deng Lei | Independent director | Leaving office | 8 May 2020 | Office term expires and re-elected |
| Ye Zhiqing | Staff representative supervisor | Leaving office | 8 May 2020 | Office term expires and re-elected |
| Zhou Zhigang | Secretary of the Board | Leaving office | 8 May 2020 | Office term expires and re-elected |
| Huang Yaying | Independent director | Elected | 8 May 2020 | Office term expires and re-elected |
| Cao Zhongxiong | Independent director | Elected | 8 May 2020 | Office term expires and re-elected |
| Fan Xiaodong | Supervisor | Elected | 8 May 2020 | Office term expires and re-elected |
| Xiao Yangjian | Secretary of the Board | Engaged | 23 June 2020 | Re-elected |
Chapter X. Information about the Company’s SecuritiesBonds publicly issued and listed in a securities exchange, immature or not fully paid by the approval date of the annual reportNo
Chapter XI Financial Statements
I. Auditor’s report
Whether the interim report is audited
□ Yes √ No
The financial statements for H1 2014 have not been audited.II. Financial statementsUnit for statements in notes to financial statements: RMB yuan
1. Consolidated Balance Sheet
Prepared by: China Fangda Group Co., Ltd.
30 June 2020
In RMB
| Item | 30 June 2020 | 31 December 2019 |
| Current asset: | ||
| Monetary capital | 1,056,919,254.36 | 1,209,811,978.95 |
| Settlement provision | ||
| Outgoing call loan | ||
| Transactional financial assets | 18,005,336.72 | 10,330,062.18 |
| Derivative financial assets | 1,815,676.34 | |
| Notes receivable | 164,526,921.14 | 305,070,930.97 |
| Account receivable | 564,418,018.59 | 1,956,191,307.07 |
| Receivable financing | 300,000.00 | 2,954,029.00 |
| Prepayment | 34,919,388.83 | 21,327,109.18 |
| Insurance receivable | ||
| Reinsurance receivable | ||
| Provisions of Reinsurance contracts receivable | ||
| Other receivables | 158,674,891.12 | 139,947,655.35 |
| Including: interest receivable | ||
| Dividend receivable | ||
| Repurchasing of financial assets |
| Inventory | 779,903,495.46 | 733,711,143.46 |
| Contract assets | 1,699,157,345.00 | |
| Assets held for sales | ||
| Non-current assets due in 1 year | ||
| Other current assets | 329,749,353.10 | 323,765,585.90 |
| Total current assets | 4,808,389,680.66 | 4,703,109,802.06 |
| Non-current assets: | ||
| Loan and advancement provided | ||
| Debt investment | ||
| Other debt investment | ||
| Long-term receivables | ||
| Long-term share equity investment | 56,847,038.74 | 57,222,240.83 |
| Investment in other equity tools | 20,140,037.85 | 20,660,181.44 |
| Other non-current financial assets | 5,018,835.30 | 5,009,728.02 |
| Investment real estate | 5,517,829,915.07 | 5,522,391,984.11 |
| Fixed assets | 484,397,283.68 | 477,332,830.92 |
| Construction in process | 138,881,024.27 | 129,988,982.86 |
| Productive biological assets | ||
| Gas & petrol | ||
| Use right assets | ||
| Intangible assets | 76,261,073.30 | 78,322,265.05 |
| R&D expense | ||
| Goodwill | ||
| Long-term amortizable expenses | 3,962,850.60 | 3,875,198.12 |
| Deferred income tax assets | 333,037,735.20 | 343,349,564.70 |
| Other non-current assets | 37,015,653.00 | 28,701,802.00 |
| Total of non-current assets | 6,673,391,447.01 | 6,666,854,778.05 |
| Total of assets | 11,481,781,127.67 | 11,369,964,580.11 |
| Current liabilities | ||
| Short-term loans | 1,280,635,666.66 | 724,618,197.34 |
| Loans from Central Bank | ||
| Call loan received | ||
| Transactional financial liabilities | ||
| Derivative financial liabilities | 96,767.62 |
| Notes payable | 531,478,369.23 | 578,816,027.44 |
| Account payable | 1,106,597,460.59 | 1,190,773,300.24 |
| Prepayment received | 4,195,179.31 | 136,340,104.73 |
| Contract liabilities | 136,799,464.76 | |
| Selling of repurchased financial assets | ||
| Deposit received and held for others | ||
| Entrusted trading of securities | ||
| Entrusted selling of securities | ||
| Employees' wage payable | 24,593,468.01 | 55,847,134.20 |
| Taxes payable | 21,287,400.76 | 17,848,987.68 |
| Other payables | 712,243,884.21 | 701,432,408.28 |
| Including: interest payable | ||
| Dividend payable | ||
| Fees and commissions payable | ||
| Reinsurance fee payable | ||
| Liabilities held for sales | ||
| Non-current liabilities due in 1 year | 151,617,767.59 | 922,346,563.72 |
| Other current liabilities | 61,298,475.68 | 181,694,574.47 |
| Total current liabilities | 4,030,747,136.80 | 4,509,814,065.72 |
| Non-current liabilities: | ||
| Insurance contract provision | ||
| Long-term loans | 1,151,161,462.35 | 546,501,491.56 |
| Bond payable | ||
| Including: preferred stock | ||
| Perpetual bond | ||
| Lease liabilities | ||
| Long-term payable | ||
| Long-term employees’ wage payable | ||
| Anticipated liabilities | 4,426,285.92 | 7,793,527.16 |
| Deferred earning | 10,823,887.41 | 10,817,247.40 |
| Deferred income tax liabilities | 1,059,467,809.75 | 1,063,833,159.00 |
| Other non-current liabilities | ||
| Total of non-current liabilities | 2,225,879,445.43 | 1,628,945,425.12 |
| Total liabilities | 6,256,626,582.23 | 6,138,759,490.84 |
| Owner’s equity: | ||
| Share capital | 1,088,278,951.00 | 1,123,384,189.00 |
| Other equity instruments | ||
| Including: preferred stock | ||
| Perpetual bond | ||
| Capital reserves | 1,454,191.59 | 1,454,191.59 |
| Less: Shares in stock | ||
| Other miscellaneous income | 465,523.75 | -475,409.25 |
| Special reserves | ||
| Surplus reserve | 95,525,281.06 | 159,805,930.34 |
| Common risk provisions | ||
| Undistributed profit | 3,991,052,115.01 | 3,898,626,177.99 |
| Total of owner’s equity belong to the parent company | 5,176,776,062.41 | 5,182,795,079.67 |
| Minor shareholders’ equity | 48,378,483.03 | 48,410,009.60 |
| Total of owners’ equity | 5,225,154,545.44 | 5,231,205,089.27 |
| Total of liabilities and owner’s interest | 11,481,781,127.67 | 11,369,964,580.11 |
Legal representative: Xiong Jianming CFO: Lin Kebing Accounting Manager: Wu Bohua
2. Balance Sheet of the Parent Company
In RMB
| Item | 30 June 2020 | 31 December 2019 |
| Current asset: | ||
| Monetary capital | 53,945,656.04 | 175,591,953.63 |
| Transactional financial assets | ||
| Derivative financial assets | ||
| Notes receivable | ||
| Account receivable | 864,942.73 | 297,813.76 |
| Receivable financing | ||
| Prepayment | 68,553.45 | 250,205.32 |
| Other receivables | 2,365,126,667.11 | 1,973,381,342.74 |
| Including: interest receivable | ||
| Dividend receivable | ||
| Inventory | ||
| Contract assets | ||
| Assets held for sales | ||
| Non-current assets due in 1 year | ||
| Other current assets | 972,396.46 | 877,430.41 |
| Total current assets | 2,420,978,215.79 | 2,150,398,745.86 |
| Non-current assets: | ||
| Debt investment | ||
| Other debt investment | ||
| Long-term receivables | ||
| Long-term share equity investment | 1,065,202,785.05 | 963,508,253.00 |
| Investment in other equity tools | 18,604,010.22 | 18,604,010.22 |
| Other non-current financial assets | 30,000,001.00 | 48,831,242.35 |
| Investment real estate | 295,355,002.00 | 295,355,002.00 |
| Fixed assets | 66,247,900.80 | 67,361,529.52 |
| Construction in process | ||
| Productive biological assets | ||
| Gas & petrol | ||
| Use right assets | ||
| Intangible assets | 1,676,556.82 | 1,824,589.22 |
| R&D expense | ||
| Goodwill | ||
| Long-term amortizable expenses | 891,188.86 | 934,669.73 |
| Deferred income tax assets | 47,572,463.06 | 44,408,630.81 |
| Other non-current assets | ||
| Total of non-current assets | 1,525,549,907.81 | 1,440,827,926.85 |
| Total of assets | 3,946,528,123.60 | 3,591,226,672.71 |
| Current liabilities | ||
| Short-term loans | 500,347,916.67 | 300,442,988.19 |
| Transactional financial liabilities | ||
| Derivative financial liabilities | ||
| Notes payable |
| Account payable | 606,941.85 | 606,941.85 |
| Prepayment received | 728,878.76 | 746,761.55 |
| Contract liabilities | ||
| Employees' wage payable | 1,069,717.45 | 3,215,013.16 |
| Taxes payable | 794,988.70 | 312,647.89 |
| Other payables | 941,804,220.47 | 109,837,934.17 |
| Including: interest payable | ||
| Dividend payable | ||
| Liabilities held for sales | ||
| Non-current liabilities due in 1 year | 80,115,783.33 | 520,872,206.95 |
| Other current liabilities | ||
| Total current liabilities | 1,525,468,447.23 | 936,034,493.76 |
| Non-current liabilities: | ||
| Long-term loans | 70,000,000.00 | |
| Bond payable | ||
| Including: preferred stock | ||
| Perpetual bond | ||
| Lease liabilities | ||
| Long-term payable | ||
| Long-term employees’ wage payable | ||
| Anticipated liabilities | ||
| Deferred earning | ||
| Deferred income tax liabilities | 64,201,364.63 | 64,351,075.92 |
| Other non-current liabilities | ||
| Total of non-current liabilities | 64,201,364.63 | 134,351,075.92 |
| Total liabilities | 1,589,669,811.86 | 1,070,385,569.68 |
| Owner’s equity: | ||
| Share capital | 1,088,278,951.00 | 1,123,384,189.00 |
| Other equity instruments | ||
| Including: preferred stock | ||
| Perpetual bond | ||
| Capital reserves | 360,835.52 | 360,835.52 |
| Less: Shares in stock |
| Other miscellaneous income | 1,287,629.38 | 1,287,629.38 |
| Special reserves | ||
| Surplus reserve | 95,525,281.06 | 159,805,930.34 |
| Undistributed profit | 1,171,405,614.78 | 1,236,002,518.79 |
| Total of owners’ equity | 2,356,858,311.74 | 2,520,841,103.03 |
| Total of liabilities and owner’s interest | 3,946,528,123.60 | 3,591,226,672.71 |
3. Consolidated Income Statement
In RMB
| Item | H1 2020 | H1 2019 |
| 1. Total revenue | 1,251,608,064.42 | 1,425,890,946.99 |
| Incl. Business income | 1,251,608,064.42 | 1,425,890,946.99 |
| Interest income | ||
| Insurance fee earned | ||
| Fee and commission received | ||
| 2. Total business cost | 1,157,918,504.87 | 1,281,585,400.17 |
| Incl. Business cost | 970,370,412.06 | 1,066,065,970.56 |
| Interest expense | ||
| Fee and commission paid | ||
| Insurance discharge payment | ||
| Net claim amount paid | ||
| Net insurance policy responsibility reserves provided | ||
| Insurance policy dividend paid | ||
| Reinsurance expenses | ||
| Taxes and surcharges | 7,526,514.98 | 41,481,000.07 |
| Sales expense | 20,978,235.09 | 27,175,638.50 |
| Administrative expense | 62,559,463.16 | 82,678,777.56 |
| R&D cost | 51,599,310.87 | 14,702,673.12 |
| Financial expenses | 44,884,568.71 | 49,481,340.36 |
| Including: interest cost | 43,164,977.83 | 40,476,886.48 |
| Interest income | 6,952,304.21 | 2,439,090.91 |
| Add: other gains | 6,214,112.77 | 4,001,450.51 |
| Investment gains (―-‖ for loss) | -713,663.54 | 4,056,397.16 |
| Incl. Investment gains from affiliates and joint ventures | -375,202.09 | -325,733.55 |
| Financial assets derecognised as a result of amortized cost | -2,255,794.10 | |
| Exchange gains ("-" for loss) | ||
| Net open hedge gains (―-‖ for loss) | ||
| Gains from change of fair value (―-― for loss) | 9,107.28 | 121,506.67 |
| Credit impairment ("-" for loss) | 74,854,185.26 | -4,369,660.38 |
| Investment impairment loss ("-" for loss) | 0.00 | |
| Investment gains ("-" for loss) | -1,981.72 | -27,108.78 |
| 3. Operational profit ("-" for loss) | 174,051,319.60 | 148,088,132.00 |
| Plus: non-operational income | 275,841.64 | 4,873,892.15 |
| Less: non-operational expenditure | 5,275,868.33 | 378,565.80 |
| 4. Gross profit ("-" for loss) | 169,051,292.91 | 152,583,458.35 |
| Less: Income tax expenses | 22,242,934.91 | 24,019,259.71 |
| 5. Net profit ("-" for net loss) | 146,808,358.00 | 128,564,198.64 |
| (1) By operating consistency | ||
| 1. Net profit from continuous operation ("-" for net loss) | 146,808,358.00 | 128,570,716.39 |
| 2. Net profit from discontinuous operation ("-" for net loss) | -6,517.75 | |
| (2) By ownership | ||
| 1. Net profit attributable to the owners of parent company | 146,839,884.57 | 128,581,755.01 |
| 2. Minor shareholders’ equity | -31,526.57 | -17,556.37 |
| 6. After-tax net amount of other misc. incomes | 940,933.00 | 1,389,774.33 |
| After-tax net amount of other misc. incomes attributed to parent's owner | 940,933.00 | 1,389,774.33 |
| (1) Other misc. incomes that cannot be re-classified into gain and loss | -520,143.59 | |
| 1. Re-measure the change in the defined benefit plan |
| 2. Other comprehensive income that cannot be transferred to profit or loss under the equity method | ||
| 3. Fair value change of investment in other equity tools | -520,143.59 | |
| 4. Fair value change of the company's credit risk | ||
| 5. Others | ||
| (2) Other misc. incomes that will be re-classified into gain and loss | 1,461,076.59 | 1,389,774.33 |
| 1. Other comprehensive income that can be transferred to profit or loss under the equity method | ||
| 2. Fair value change of other debt investment | ||
| 3. Gains and losses from changes in fair value of available-for-sale financial assets | ||
| 4. Other credit investment credit impairment provisions | ||
| 5. Cash flow hedge reserve | 1,625,577.36 | 1,396,635.00 |
| 6. Translation difference of foreign exchange statement | -164,500.77 | -6,860.67 |
| 7. Others | ||
| After-tax net of other misc. income attributed to minority shareholders | ||
| 7. Total of misc. incomes | 147,749,291.00 | 129,953,972.97 |
| Total of misc. incomes attributable to the owners of the parent company | 147,780,817.57 | 129,971,529.34 |
| Total misc gains attributable to the minor shareholders | -31,526.57 | -17,556.37 |
| 8. Earnings per share: | ||
| (1) Basic earnings per share | 0.13 | 0.11 |
| (2) Diluted earnings per share | 0.13 | 0.11 |
Net profit contributed by entities merged under common control in the report period was RMB0.00, net profit realized by partiesmerged during the previous period is RMB0.00.Legal representative: Xiong Jianming CFO: Lin Kebing Accounting Manager: Wu Bohua
4. Income Statement of the Parent Company
In RMB
| Item | H1 2020 | H1 2019 |
| 1. Turnover | 12,719,395.10 | 17,142,022.88 |
| Less: Operation cost | 151,219.77 | 3,496,588.06 |
| Taxes and surcharges | 677,865.78 | 645,703.49 |
| Sales expense | ||
| Administrative expense | 11,316,043.39 | 11,286,569.85 |
| R&D cost | ||
| Financial expenses | 14,753,727.62 | 21,369,380.01 |
| Including: interest cost | 15,820,677.77 | 17,322,986.12 |
| Interest income | 1,914,893.50 | 351,128.89 |
| Add: other gains | 295,818.89 | 234,066.99 |
| Investment gains (―-‖ for loss) | 338,561.17 | 1,155,183.42 |
| Incl. Investment gains from affiliates and joint ventures | ||
| Financial assets derecognised as a result of amortized cost ("-" for loss) | ||
| Net open hedge gains (―-‖ for loss) | ||
| Gains from change of fair value (―-― for loss) | ||
| Credit impairment ("-" for loss) | -2,277.86 | 4,732.39 |
| Investment impairment loss ("-" for loss) | ||
| Investment gains ("-" for loss) | ||
| 2. Operational profit (―-‖ for loss) | -13,547,359.26 | -18,262,235.73 |
| Plus: non-operational income | 51,867.26 | 13,947.68 |
| Less: non-operational expenditure | 1,008.00 | 106,388.64 |
| 4. Gross profit ("-" for loss) | -13,496,500.00 | -18,354,676.69 |
| Less: Income tax expenses | -3,313,543.54 | -4,545,338.46 |
| 4. Net profit (―-‖ for net loss) | -10,182,956.46 | -13,809,338.23 |
| (1) Net profit from continuous operation ("-" for net loss) | -10,182,956.46 | -13,809,338.23 |
| (2) Net profit from discontinuous operation ("-" for net loss) | ||
| 5. After-tax net amount of other misc. incomes | ||
| (1) Other misc. incomes that cannot be re-classified into gain and loss | ||
| 1. Re-measure the change in the defined benefit plan | ||
| 2. Other comprehensive income that cannot be transferred to profit or loss under the equity method | ||
| 3. Fair value change of investment in other equity tools | ||
| 4. Fair value change of the company's credit risk | ||
| 5. Others | ||
| (2) Other misc. incomes that will be re-classified into gain and loss | ||
| 1. Other comprehensive income that can be transferred to profit or loss under the equity method | ||
| 2. Fair value change of other debt investment | ||
| 3. Gains and losses from changes in fair value of available-for-sale financial assets | ||
| 4. Other credit investment credit impairment provisions | ||
| 5. Cash flow hedge reserve | ||
| 6. Translation difference of foreign exchange statement | ||
| 7. Others | ||
| 6. Total of misc. incomes | -10,182,956.46 | -13,809,338.23 |
| 7. Earnings per share: | ||
| (1) Basic earnings per share | ||
| (2) Diluted earnings per share |
5. Consolidated Cash Flow Statement
In RMB
| Item | H1 2020 | H1 2019 |
| 1. Net cash flow from business operations: | ||
| Cash received from sales of products and providing of services | 1,148,453,499.83 | 1,201,792,721.87 |
| Net increase of customer deposits and capital kept for brother company | ||
| Net increase of loans from central bank | ||
| Net increase of inter-bank loans from other financial bodies | ||
| Cash received against original insurance contract | ||
| Net cash received from reinsurance business | ||
| Net increase of client deposit and investment | ||
| Cash received as interest, processing fee, and commission | ||
| Net increase of inter-bank fund received | ||
| Net increase of repurchasing business | ||
| Net cash received from trading securities | ||
| Tax refunded | 3,698,239.91 | 1,495,878.35 |
| Other cash received from business operation | 213,941,117.36 | 48,007,747.43 |
| Sub-total of cash inflow from business operations | 1,366,092,857.10 | 1,251,296,347.65 |
| Cash paid for purchasing products and services | 993,332,051.36 | 977,060,414.15 |
| Net increase of client trade and advance | ||
| Net increase of savings in central bank and brother company |
| Cash paid for original contract claim | ||
| Net increase in funds dismantled | ||
| Cash paid for interest, processing fee and commission | ||
| Cash paid for policy dividend | ||
| Cash paid to and for the staff | 166,379,960.84 | 162,220,114.55 |
| Taxes paid | 66,683,039.19 | 177,525,390.09 |
| Other cash paid for business activities | 276,683,285.11 | 307,215,431.97 |
| Sub-total of cash outflow from business operations | 1,503,078,336.50 | 1,624,021,350.76 |
| Cash flow generated by business operations, net | -136,985,479.40 | -372,725,003.11 |
| 2. Cash flow generated by investment: | ||
| Cash received from investment recovery | 2,502,405,357.62 | 2,093,521,250.01 |
| Cash received as investment profit | 9,253,861.27 | 21,362,317.22 |
| Net cash retrieved from disposal of fixed assets, intangible assets, and other long-term assets | 13,165,854.60 | |
| Net cash received from disposal of subsidiaries or other operational units | ||
| Other investment-related cash received | 250.00 | |
| Sub-total of cash inflow generated from investment | 2,511,659,468.89 | 2,128,049,421.83 |
| Cash paid for construction of fixed assets, intangible assets and other long-term assets | 69,438,943.88 | 90,816,069.59 |
| Cash paid as investment | 2,509,460,000.00 | 2,555,019,000.00 |
| Net increase of loan against pledge | ||
| Net cash paid for acquiring subsidiaries and other operational units | 61,934,830.31 | |
| Other cash paid for investment | ||
| Subtotal of cash outflows | 2,578,898,943.88 | 2,707,769,899.90 |
| Cash flow generated by investment activities, net | -67,239,474.99 | -579,720,478.07 |
| 3. Cash flow generated by financing activities: | ||
| Cash received from investment | ||
| Incl. Cash received from investment attracted by subsidiaries from minority shareholders | ||
| Cash received from borrowed loans | 2,304,697,876.18 | 800,000,000.00 |
| Other cash received from financing activities | 39,406.61 | |
| Subtotal of cash inflow from financing activities | 2,304,697,876.18 | 800,039,406.61 |
| Cash paid to repay debts | 1,813,978,153.39 | 108,000,000.00 |
| Cash paid as dividend, profit, or interests | 119,588,570.23 | 275,410,279.99 |
| Including: dividends and profits paid by subsidiaries to minority shareholders | ||
| Other cash paid for financing activities | 281,298,965.99 | 40,000,000.00 |
| Subtotal of cash outflow from financing activities | 2,214,865,689.61 | 423,410,279.99 |
| Net cash flow generated by financing activities | 89,832,186.57 | 376,629,126.62 |
| 4. Influence of exchange rate changes on cash and cash equivalents | 1,284,254.96 | -229,009.27 |
| 5. Net increase in cash and cash equivalents | -113,108,512.86 | -576,045,363.83 |
| Plus: Balance of cash and cash equivalents at the beginning of term | 725,269,902.90 | 956,190,890.68 |
| 6. Balance of cash and cash equivalents at the end of the period | 612,161,390.04 | 380,145,526.85 |
6. Cash Flow Statement of the Parent Company
In RMB
| Item | H1 2020 | H1 2019 |
| 1. Net cash flow from business operations: |
| Cash received from sales of products and providing of services | 8,683,073.96 | 14,039,967.56 |
| Tax refunded | 232,652.87 | |
| Other cash received from business operation | 2,914,427,921.50 | 1,674,530,421.33 |
| Sub-total of cash inflow from business operations | 2,923,343,648.33 | 1,688,570,388.89 |
| Cash paid for purchasing products and services | 406,441.27 | 1,824,577.30 |
| Cash paid to and for the staff | 9,739,820.05 | 8,465,407.93 |
| Taxes paid | 793,263.98 | 1,250,265.96 |
| Other cash paid for business activities | 2,553,029,078.24 | 2,021,264,885.71 |
| Sub-total of cash outflow from business operations | 2,563,968,603.54 | 2,032,805,136.90 |
| Cash flow generated by business operations, net | 359,375,044.79 | -344,234,748.01 |
| 2. Cash flow generated by investment: | ||
| Cash received from investment recovery | 562,800,000.00 | 710,000,000.00 |
| Cash received as investment profit | 338,561.17 | 1,155,183.42 |
| Net cash retrieved from disposal of fixed assets, intangible assets, and other long-term assets | ||
| Net cash received from disposal of subsidiaries or other operational units | ||
| Other investment-related cash received | ||
| Sub-total of cash inflow generated from investment | 563,138,561.17 | 711,155,183.42 |
| Cash paid for construction of fixed assets, intangible assets and other long-term assets | 48,767.89 | 50,698.00 |
| Cash paid as investment | 562,800,000.00 | 746,000,001.00 |
| Net cash paid for acquiring subsidiaries and other operational units | ||
| Other cash paid for investment | ||
| Subtotal of cash outflows | 562,848,767.89 | 746,050,699.00 |
| Cash flow generated by investment activities, net | 289,793.28 | -34,895,515.58 |
| 3. Cash flow generated by financing activities: | ||
| Cash received from investment | ||
| Cash received from borrowed loans | 500,000,000.00 | 400,000,000.00 |
| Other cash received from financing activities | 39,406.61 | |
| Subtotal of cash inflow from financing activities | 500,000,000.00 | 400,039,406.61 |
| Cash paid to repay debts | 810,000,000.00 | |
| Cash paid as dividend, profit, or interests | 71,233,278.75 | 241,065,709.32 |
| Other cash paid for financing activities | 99,998,965.99 | |
| Subtotal of cash outflow from financing activities | 981,232,244.74 | 241,065,709.32 |
| Net cash flow generated by financing activities | -481,232,244.74 | 158,973,697.29 |
| 4. Influence of exchange rate changes on cash and cash equivalents | -78,890.92 | 405.76 |
| 5. Net increase in cash and cash equivalents | -121,646,297.59 | -220,156,160.54 |
| Plus: Balance of cash and cash equivalents at the beginning of term | 175,341,953.63 | 281,594,621.80 |
| 6. Balance of cash and cash equivalents at the end of the period | 53,695,656.04 | 61,438,461.26 |
7. Statement of Change in Owners’ Equity (Consolidated)
Amount of the Current Term
In RMB
| Item | H1 2020 | ||||||||||||||
| Owners' Equity Attributable to the Parent Company | Minor shareholders’ equity | Total of owners’ equity | |||||||||||||
| Share capital | Other equity instruments | Capital reserves | Less: Shares in stock | Other miscellaneous incom | Special reserves | Surplus reserve | Common risk provisions | Undistributed profit | Others | Subtotal | |||||
| Preferred | Perpetual | Others | |||||||||||||
| share | bond | e | |||||||||||||
| 1. Balance at the end of last year | 1,123,384,189.00 | 1,454,191.59 | -475,409.25 | 159,805,930.34 | 3,898,626,177.99 | 5,182,795,079.67 | 48,410,009.60 | 5,231,205,089.27 | |||||||
| Plus: Changes in accounting policies | |||||||||||||||
| Correction of previous errors | |||||||||||||||
| Consolidation of entities under common control | |||||||||||||||
| Others | |||||||||||||||
| 2. Balance at the beginning of current year | 1,123,384,189.00 | 1,454,191.59 | -475,409.25 | 159,805,930.34 | 3,898,626,177.99 | 5,182,795,079.67 | 48,410,009.60 | 5,231,205,089.27 | |||||||
| 3. Change amount in the current period (―-― for decrease) | -35,105,238.00 | 940,933.00 | -64,280,649.28 | 92,425,937.02 | -6,019,017.26 | -31,526.57 | -6,050,543.83 | ||||||||
| (1) Total of misc. incomes | 940,933.00 | 146,839,884.57 | 147,780,817.57 | -31,526.57 | 147,749,291.00 | ||||||||||
| (2) Investment or decreasing of capital by owners | -35,105,238.00 | -64,280,649.28 | -99,385,887.28 | -99,385,887.28 | |||||||||||
| 1. Common shares invested by owners | -35,105,238.00 | -64,280,649.28 | -99,385,887.28 | -99,385,887.28 | |||||||||||
| 2 Capital contributed by other equity instrument |
| holders | |||||||||||||||
| 3. Amount of shares paid and accounted as owners' equity | |||||||||||||||
| 4. Others | |||||||||||||||
| (3) Profit allotment | -54,413,947.55 | -54,413,947.55 | -54,413,947.55 | ||||||||||||
| 1. Provision of surplus reserves | |||||||||||||||
| 2 Common risk provision | |||||||||||||||
| 3. Distribution to owners (or shareholders) | -54,413,947.55 | -54,413,947.55 | -54,413,947.55 | ||||||||||||
| 4. Others | |||||||||||||||
| (4) Internal carry-over of owners' equity | |||||||||||||||
| 1. Capitalizing of capital reserves (or share capital) | |||||||||||||||
| 2 Capitalizing of surplus reserves (or share capital) | |||||||||||||||
| 3. Surplus reserves used to cover losses | |||||||||||||||
| 4. Retained gain transferred due to change in set benefit program | |||||||||||||||
| 5. Other miscellaneous income | |||||||||||||||
| 6. Others | |||||||||||||||
| (5) Special |
| reserves | |||||||||||||||
| 1. Provided this year | |||||||||||||||
| 2 Used this period | |||||||||||||||
| (6) Others | |||||||||||||||
| 4. Balance at the end of this period | 1,088,278,951.00 | 1,454,191.59 | 465,523.75 | 95,525,281.06 | 3,991,052,115.01 | 5,176,776,062.41 | 48,378,483.03 | 5,225,154,545.44 |
Amount of the Previous Term
In RMB
| Item | H1 2019 | ||||||||||||||
| Owners' Equity Attributable to the Parent Company | Minor shareholders’ equity | Total of owners’ equity | |||||||||||||
| Share capital | Other equity instruments | Capital reserves | Less: Shares in stock | Other miscellaneous income | Special reserves | Surplus reserve | Common risk provisions | Undistributed profit | Others | Subtotal | |||||
| Preferred share | Perpetual bond | Others | |||||||||||||
| 1. Balance at the end of last year | 1,155,481,686.00 | 1,454,191.59 | 10,831,437.66 | 7,382,087.59 | 120,475,221.40 | 3,921,225,872.96 | 5,195,187,621.88 | 5,195,187,621.88 | |||||||
| Plus: Changes in accounting policies | -5,166,425.58 | 524,860.03 | 16,171,320.58 | 11,529,755.03 | 11,529,755.03 | ||||||||||
| Correction of previous errors | |||||||||||||||
| Consolidation of entities under common control | |||||||||||||||
| Others | |||||||||||||||
| 2. Balance at the beginning of current year | 1,155,481,686.0 | 1,454,191.59 | 10,831,437.66 | 2,215,662.01 | 121,000,081.43 | 3,937,397,193.54 | 5,206,717,376.91 | 5,206,717,376.91 | |||||||
| 0 | |||||||||||||||
| 3. Change amount in the current period (―-― for decrease) | -32,097,497.00 | -10,831,437.66 | 1,389,774.33 | -66,957,886.36 | -96,095,082.78 | -182,929,254.15 | 50,345,533.53 | -132,583,720.62 | |||||||
| (1) Total of misc. incomes | 1,389,774.33 | 128,581,755.01 | 129,971,529.34 | -17,556.37 | 129,953,972.97 | ||||||||||
| (2) Investment or decreasing of capital by owners | -32,097,497.00 | -10,831,437.66 | -66,957,886.36 | -88,223,945.70 | 50,363,089.90 | -37,860,855.80 | |||||||||
| 1. Common shares invested by owners | -32,097,497.00 | -10,831,437.66 | -66,957,886.36 | -88,223,945.70 | 50,363,089.90 | -37,860,855.80 | |||||||||
| 2 Capital contributed by other equity instrument holders | |||||||||||||||
| 3. Amount of shares paid and accounted as owners' equity | |||||||||||||||
| 4. Others | |||||||||||||||
| (3) Profit allotment | -224,676,837.79 | -224,676,837.79 | -224,676,837.79 | ||||||||||||
| 1. Provision of surplus reserves | |||||||||||||||
| 2 Common risk provision | |||||||||||||||
| 3. Distribution to owners (or shareholders) | -224,676,837.79 | -224,676,837.79 | -224,676,837.79 | ||||||||||||
| 4. Others | |||||||||||||||
| (4) Internal carry-over of owners' equity |
| 1. Capitalizing of capital reserves (or share capital) | |||||||||||||||
| 2 Capitalizing of surplus reserves (or share capital) | |||||||||||||||
| 3. Surplus reserves used to cover losses | |||||||||||||||
| 4. Retained gain transferred due to change in set benefit program | |||||||||||||||
| 5. Other miscellaneous income | |||||||||||||||
| 6. Others | |||||||||||||||
| (5) Special reserves | |||||||||||||||
| 1. Provided this year | |||||||||||||||
| 2 Used this period | |||||||||||||||
| (6) Others | |||||||||||||||
| 4. Balance at the end of this period | 1,123,384,189.00 | 1,454,191.59 | 3,605,436.34 | 54,042,195.07 | 3,841,302,110.76 | 5,023,788,122.76 | 50,345,533.53 | 5,074,133,656.29 |
8. Statement of Change in Owners’ Equity (Parent Company)
Amount of the Current Term
In RMB
| Item | H1 2020 | |||||||||||
| Share capital | Other equity instruments | Capital reserves | Less: Shares in stock | Other miscellaneous | Special reserves | Surplus reserve | Undistributed profit | Others | Total of owners’ equity | |||
| Preferr | Perpet | Others | ||||||||||
| ed share | ual bond | income | ||||||||||
| 1. Balance at the end of last year | 1,123,384,189.00 | 360,835.52 | 1,287,629.38 | 159,805,930.34 | 1,236,002,518.79 | 2,520,841,103.03 | ||||||
| Plus: Changes in accounting policies | 0.00 | |||||||||||
| Correction of previous errors | 0.00 | |||||||||||
| Others | 0.00 | |||||||||||
| 2. Balance at the beginning of current year | 1,123,384,189.00 | 360,835.52 | 0.00 | 1,287,629.38 | 159,805,930.34 | 1,236,002,518.79 | 2,520,841,103.03 | |||||
| 3. Change amount in the current period (―-― for decrease) | -35,105,238.00 | -64,280,649.28 | -64,596,904.01 | -163,982,791.29 | ||||||||
| (1) Total of misc. incomes | -10,182,956.46 | -10,182,956.46 | ||||||||||
| (2) Investment or decreasing of capital by owners | -35,105,238.00 | -64,280,649.28 | -99,385,887.28 | |||||||||
| 1. Common shares invested by owners | -35,105,238.00 | -64,280,649.28 | -99,385,887.28 | |||||||||
| 2 Capital contributed by other equity instrument holders | 0.00 | |||||||||||
| 3. Amount of shares paid and accounted as owners' equity | 0.00 | |||||||||||
| 4. Others | 0.00 |
| (3) Profit allotment | -54,413,947.55 | -54,413,947.55 | ||||||||||
| 1. Provision of surplus reserves | 0.00 | |||||||||||
| 2 Distribution to owners (or shareholders) | -54,413,947.55 | -54,413,947.55 | ||||||||||
| 3. Others | 0.00 | |||||||||||
| (4) Internal carry-over of owners' equity | 0.00 | |||||||||||
| 1. Capitalizing of capital reserves (or share capital) | 0.00 | |||||||||||
| 2 Capitalizing of surplus reserves (or share capital) | 0.00 | |||||||||||
| 3. Surplus reserves used to cover losses | 0.00 | |||||||||||
| 4. Retained gain transferred due to change in set benefit program | 0.00 | |||||||||||
| 5. Other miscellaneous income | 0.00 | |||||||||||
| 6. Others | 0.00 | |||||||||||
| (5) Special reserves | 0.00 | |||||||||||
| 1. Provided this year | 0.00 | |||||||||||
| 2 Used this period | 0.00 | |||||||||||
| (6) Others | 0.00 | |||||||||||
| 4. Balance at the end of this period | 1,088,278,951.00 | 360,835.52 | 1,287,629.38 | 95,525,281.06 | 1,171,405,614.78 | 2,356,858,311.74 |
Amount of the Previous Term
In RMB
| Item | H1 2019 | |||||||||||
| Share capital | Other equity instruments | Capital reserves | Less: Shares in stock | Other miscellaneous income | Special reserves | Surplus reserve | Undistributed profit | Others | Total of owners’ equity | |||
| Preferred share | Perpetual bond | Others | ||||||||||
| 1. Balance at the end of last year | 1,155,481,686.00 | 360,835.52 | 10,831,437.66 | 8,756,553.46 | 120,475,221.40 | 504,081,999.00 | 1,778,324,857.72 | |||||
| Plus: Changes in accounting policies | -5,166,425.58 | 524,860.03 | 4,723,740.20 | 82,174.65 | ||||||||
| Correction of previous errors | ||||||||||||
| Others | ||||||||||||
| 2. Balance at the beginning of current year | 1,155,481,686.00 | 360,835.52 | 10,831,437.66 | 3,590,127.88 | 121,000,081.43 | 508,805,739.20 | 1,778,407,032.37 | |||||
| 3. Change amount in the current period (―-― for decrease) | -32,097,497.00 | -10,831,437.66 | -66,957,886.36 | -238,486,176.03 | -326,710,121.73 | |||||||
| (1) Total of misc. incomes | -13,809,338.23 | -13,809,338.23 | ||||||||||
| (2) Investment or decreasing of capital by owners | -32,097,497.00 | -10,831,437.66 | -66,957,886.36 | -88,223,945.70 | ||||||||
| 1. Common shares invested by owners | -32,097,497.00 | -10,831,437.66 | -66,957,886.36 | -88,223,945.70 | ||||||||
| 2 Capital contributed by other equity instrument | ||||||||||||
| holders | ||||||||||||
| 3. Amount of shares paid and accounted as owners' equity | ||||||||||||
| 4. Others | ||||||||||||
| (3) Profit allotment | -224,676,837.80 | -224,676,837.80 | ||||||||||
| 1. Provision of surplus reserves | ||||||||||||
| 2 Distribution to owners (or shareholders) | -224,676,837.80 | -224,676,837.80 | ||||||||||
| 3. Others | ||||||||||||
| (4) Internal carry-over of owners' equity | ||||||||||||
| 1. Capitalizing of capital reserves (or share capital) | ||||||||||||
| 2 Capitalizing of surplus reserves (or share capital) | ||||||||||||
| 3. Surplus reserves used to cover losses | ||||||||||||
| 4. Retained gain transferred due to change in set benefit program | ||||||||||||
| 5. Other miscellaneous income | ||||||||||||
| 6. Others | ||||||||||||
| (5) Special reserves | ||||||||||||
| 1. Provided this year |
| 2 Used this period | ||||||||||||
| (6) Others | ||||||||||||
| 4. Balance at the end of this period | 1,123,384,189.00 | 360,835.52 | 3,590,127.88 | 54,042,195.07 | 270,319,563.17 | 1,451,696,910.64 |
III. General Information
1. LITITONG's Profile
China Fangda Group Co., Ltd. (hereinafter referred to as "the Company") was approved in October 1995 by the General Officeof the Shenzhen Municipal People's Government with the letter of Shenfu Office (1995) No. 194, in the original "Shenzhen FangdaBuilding Materials Co., Ltd." on the basis of the establishment of the fundraising method. The unified social credit code is:
91440300192448589C; registered address: Fangda Technology Building, Keji South 12th Road, South District, High-techIndustrial Park, Nanshan District, Shenzhen. Mr. Xiong Jianming is the legal representative.
The Company issued foreign currency shares (B shares) and local currency shares (A shares) and listed in November 1995 andApril 1996 respectively in Shenzhen Stock Exchange. The Company received the Reply to the Non-public Share Issuance of FangdaChina Group Co., Ltd. (CSRC License [2016] No.825) to allow the Company to conduct non-public issuance of 32,184,931 A-sharesin June 20116. According to the 2016 Annual Profit Allocation Scheme, which was approved by the 2016 Annual Shareholders'Congress, the Company has a total share capital of 789, 094, 836 shares as the basis and a capital reserve fund of 5 shares per 10shares to all shareholders. The registered capital at the end of 2017 was RMB1,183,642,254.00. In August 2018, the Companyrepurchased and cancelled 28,160,568 B-shares. In January 2019, the company repurchased and cancelled 32,097,497 B-shares. Thecompany repurchased and cancelled in May 2020, and cancelled 35,105,238 B shares, and the existing registered capital isRMB1,088,278,951.00.
The Company has established a corporate governance structure that comprises shareholders’ meeting, board of directors andsupervisory committee. Currently, the Company sets up the President Office, Administrative Department, HR Department, EnterpriseManagement Department, Financial Department, Audit and Supervisory Department, Securities Department, Technology InnovationDepartment and IT Department and has established subsidiaries including Fangda Decoration, Fangda Chuangzhi, Fangda NewMaterial, Fangda Property and Fangda New Energy.
The business nature and main business operations of the Company and subsidiaries (―the Group‖) include (1) production andsales of curtain wall materials, design, production and installation of construction curtain walls; (2) assembly and production ofsubway screen doors; (3) development and operation of real estate projects on land, of which rights have been obtained lawfully; (4)R&D, installation and sales of PV devices, design and installation of PV power plants.
2. Consolidation Scope and Change
This part of the simplified disclosure is as follows: The company in the current period includes a total of 24 subsidiaries, ofwhich 1 have been added this year and 2 have been reduced this year. For details, please refer to "Note 6. Change of the scope ofmerger" and "Note 9. Rights and Interests in Other Subjects".
IV. Basis for the preparation of financial statements
1. Preparation basis
The company prepares the financial statements based on continuous operation and according to actual transactions and events,with figures confirmed and measured in compliance with the Accounting Standards for Business Enterprises and other specificaccount standards, application guide and interpretations. The Company has also disclosed related financial information according tothe requirement of the Regulations of Information Disclosure No.15 – General Provisions for Financial Statements (Revised in 2014)issued by the CSRC.
2. Continuous operation
The Company assessed the continuing operations capability of the Company for the 12 months from the end of the reportingperiod. No matters were found that would affect the Company's ability to continue as a going concern. It is reasonable for theCompany to prepare financial statements based on continuing operations.V. Significant Account Policies and EstimatesSpecific accounting policy and estimate prompt:
The following major accounting policies and accounting estimates shall be formulated in accordance with the accounting standardsof the enterprise. Unmentioned operations are carried out in accordance with the relevant accounting policies in the enterpriseaccounting standards.
1. Statement of compliance to the Enterprise Accounting Standard
These financial statements meet the requirements of the Accounting Standards for Business Enterprises and truly and fullyreflect the Company’s financial status, performance result, changes in shareholders’ equity and cash flows.
2. Fiscal Period
The company's fiscal year starts on January 1 and ends on December 31 of the Gregorian calendar.
3. Operation period
Our normal business cycle is one year
4. Bookkeeping standard money
The company's bookkeeping standard currency is Renminbi, and overseas subsidiaries are based on the currency of the maineconomic environment in which they operate.
5. Accounting treatment of the entities under common and different control
(1) Consolidation of entities under common control
The assets and liabilities acquired by the company in a business combination are measured at the book value of the combinedparty in the consolidated financial statements of the ultimate controlling party on the date of combination. Among them, if theaccounting policy adopted by the merger party is different from that adopted by the company before the merger, the accountingpolicy is unified based on the principle of importance, that is, the book value of the assets and liabilities of the merger party isadjusted according to the accounting policy of the company. If there is a difference between the book value of the net assets acquiredby the company in the business combination and the book value of the consideration paid, first adjust the balance of the capitalreserve (capital premium or equity premium), the balance of the capital reserve (capital premium or equity premium) If it isinsufficient to offset, the surplus reserve and undistributed profits will be offset in sequence.The accounting treatment method of enterprise merger under the same control through step-by-step transaction is described inSection 5 and 6 (5).
(2) Consolidation of entities under different control
All identifiable assets and liabilities acquired by the Company during the merger shall be measured at its fair value on the dateof purchase. Among them, if the accounting policy adopted by the merger party is different from that adopted by the company beforethe merger, the accounting policy is unified based on the principle of importance, that is, the book value of the assets and liabilities ofthe merger party is adjusted according to the accounting policy of the company. The merger cost of the company on the date ofpurchase is greater than the fair value of the assets and liabilities recognized by the purchaser in the merger, and is recognized asgoodwill. If the merger cost is less than the difference between the identifiable assets and the fair value of the liabilities obtained bythe purchaser in the enterprise merger, the merger cost and the fair value of the identifiable assets and the liabilities obtained by thepurchaser in the enterprise merger are reviewed, and the merger cost is still less than the fair value of the identifiable assets andliabilities obtained by the purchaser after the review, the difference is considered as the profit and loss of the current period of themerger.
See V, 6 (5) for the accounting treatment method of business combination under the same control through step-by-steptransaction.
(3) Treatment of related transaction fee in enterprise merger
Agency expenses and other administrative expenses such as auditing, legal consulting, or appraisal services occurred relatingto the merger of entities are accounted into current income account when occurred. The transaction fees of equity certificates orliability certificates issued by the purchaser for payment for the acquisition are accounted at the initial amount of the certificates.
6. Preparation of Consolidated Financial Statements
(1) Determination of consolidation scope
The consolidated scope of the consolidated financial statements is determined on a control basis and includes not onlysubsidiaries determined on the basis of voting rights (or similar voting rights) themselves or in conjunction with other arrangements,but also structured subjects determined on the basis of one or more contractual arrangements.
Control means the power possessed by the Company on invested entities to share variable returns by participating in relatedactivities of the invested entities and to impact the amount of the returns by using the power. The subsidiary company is the subjectcontrolled by the company (including the enterprise, the divisible part of the invested unit and the structured subject controlled by theenterprise, etc.). The structured subject is the subject which is not designed to determine the controlling party by taking the votingright or similar right as the decisive factor.
(2) Preparation of Consolidated Financial Statements
The company prepares consolidated financial statements based on the financial statements of itself and its subsidiaries and
based on other relevant information.The company compiles consolidated financial statements, regards the whole enterprise group as an accounting entity, reflectsthe overall financial status, operating results and cash flow of the enterprise group according to the confirmation, measurement andpresentation requirements of the relevant enterprise accounting standards, and the unified accounting policy and accounting period.
① Merge the assets, liabilities, owner's rights and interests, income, expenses and cash flow of parent company andsubsidiary company.
② Offset the long-term equity investment of the parent company to the subsidiary company and the share of the parentcompany in the ownership rights of the subsidiary company.
③ Offset the influence of internal transaction between parent company, subsidiary company and subsidiary company. Wherean internal transaction indicates a loss of impairment of the relevant assets, the loss shall be fully recognized.
④ Adjust the special transaction from the angle of enterprise group.
(3) Processing of subsidiaries during the reporting period
① Increase of subsidiaries or business
A. Subsidiary or business increased by business combination under the same control(a) When preparing the consolidated balance sheet, adjust the opening number of the consolidated balance sheet and adjust therelated items of the comparative statement. The same report entity as the consolidated balance sheet will exist from the time of thefinal control party.(b) When preparing the consolidated cash flow statement, the cash flows of the subsidiary and the business combination fromthe beginning of the current period to the end of the reporting period are included in the consolidated cash flow statement, and therelated items of the comparative statement are adjusted, which is regarded as the combined report body since the final The controllerhas been there since the beginning of control.(c) When preparing the consolidated cash flow statement, the cash flows of the subsidiary and the business combination from thebeginning of the current period to the end of the reporting period are included in the consolidated cash flow statement, and the relateditems of the comparative statement are adjusted, which is regarded as the combined report body since the final The controller hasbeen there since the beginning of control.B. Subsidiaries or businesses added by business combinations not under the same control(a) When preparing the consolidated balance sheet, the opening number of the consolidated balance sheet is not adjusted.(b) When preparing the consolidated profit statement, the income, expense and profit of the subsidiary company and the businessPurchase date and Closing balance shall be included in the consolidated profit statement.(c) When the consolidated cash flow statement is prepared, the cash flow from the purchase date of the subsidiary to the end ofthe reporting period is included in the consolidated cash flow statement.
② Disposal of subsidiaries or business
(A) When preparing the consolidated balance sheet, the opening number of the consolidated balance sheet is not adjusted.B. When preparing the consolidated profit statement, the income, expense and profit of the subsidiary company and the businessopening and disposal date shall be included in the consolidated profit statement.C. When the consolidated cash flow statement is prepared, the cash flow from the Beginning of the period of the subsidiary tothe end of the reporting period is included in the consolidated cash flow statement.
(4) Special considerations in consolidation offsets
① The long-term equity investment held by a subsidiary company shall be regarded as the inventory shares of the company as asubtraction of the owner's rights and interests, which shall be listed under the item of "subtraction: Stock shares" under the item ofowner's rights and interests in the consolidated balance sheet.The long-term equity investments held by the subsidiaries are offset by the shares of the shareholders of the subsidiaries.
② The "special reserve" and "general risk preparation" projects, because they are neither real capital (or share capital) norcapital reserve, but also different from the retained income and undistributed profits, are restored according to the ownership of theparent company after the long-term equity investment is offset by the ownership rights and interests of the subsidiary company.
③ If there is a temporary difference between the book value of assets and liabilities in the consolidated balance sheet and thetaxable basis of the taxpayer due to the offset of the unrealized internal sales gain or loss, the deferred income tax asset or thedeferred income tax liability is confirmed in the consolidated balance sheet, and the income tax expense in the consolidated profitstatement is adjusted, with the exception of the deferred income tax related to the transaction or event directly included in the owner'sequity and the merger of the enterprise.
④ The unrealized internal transaction gains and losses incurred by the company from selling assets to subsidiaries shall be fullyoffset against the "net profit attributable to the owners of the parent company". The unrealized internal transaction gains and lossesarising from the sale of assets by the subsidiary to the company shall be offset between the ―net profit attributable to the owners ofthe parent company‖ and the ―minority shareholder gains and losses‖ in accordance with the company’s distribution ratio to thesubsidiary. The unrealized internal transaction gains and losses arising from the sale of assets between subsidiaries shall be offsetbetween the "net profit attributable to the owners of the parent company" and the "minority shareholders' gains and losses" inaccordance with the company's distribution ratio to the seller's subsidiary .
⑤ If the current loss shared by the minority shareholders of the subsidiary exceeds the share of the minority shareholders in theowner ’s equity of the subsidiary at the beginning of the period, the balance should still be offset against the minorityshareholders ’equity.
(5) Accounting treatment of special transactions
① Purchase minority shareholders' equity
The Company purchases the shares of the subsidiaries owned by the minority shareholders of the subsidiaries. In the individualfinancial statements, the investment costs of the newly acquired long-term investments of the minority shares shall be measured atthe fair value of the price paid. In the consolidated financial statements, the difference between the newly acquired long-term equityinvestment due to the purchase of minority equity and the share of net assets that should be continuously calculated by the subsidiarysince the purchase date or the merger date should be adjusted according to the new shareholding ratio. The product (capital premiumor equity premium), if the capital reserve is insufficient to offset, the surplus reserve and undistributed profits are offset in turn.
② Step-by-step acquisition of control of the subsidiary through multiple transactions
A. Enterprise merger under common control through multiple transactions
On the date of the merger, the company determines the initial investment cost of the long-term equity investment in theindividual financial statements based on the share of the subsidiary ’s net assets that should be enjoyed after the merger in the finalcontroller ’s consolidated financial statements; the initial investment cost and the The difference between the book value of thelong-term equity investment before the merger plus the book value of the consideration paid for new shares acquired on the mergerdate, the capital reserve (capital premium or equity premium) is adjusted, and the capital reserve (capital premium or equity premium)is insufficient to offset Reduced, in turn offset the surplus reserve and undistributed profits.
In consolidated financial statements, assets and liabilities obtained by the merging party from the merged party should bemeasured at the book value in the final controlling party’s consolidated financial statements other than the adjustment made due todifferences in accounting policies; adjust the capital surplus (share premium) according to the difference between the initialinvestment cost and the book value of the held investment before merger plus the book value of the consideration paid on the mergerdate. Where the capital surplus falls short, the retained income should be adjusted.If the merging party holds the equity investment before acquiring the control of the merged party and is accounted for accordingto the equity method, the date of acquiring the original equity and the merging party and the merged party are in the same party's finalcontrol from the later date to the merger date The relevant gains and losses, other comprehensive income and other changes inowner's equity have been confirmed between them, and the retained earnings at the beginning of the comparative statement periodshould be offset separately.B. Enterprise merger not under common control through multiple transactionsOn the merger day, in individual financial statements, the initial investment cost of the long-term equity investment on themerger day is based on the book value of the long-term equity investment previously held plus the sum of the additional investmentcosts on the merger day.In the consolidated financial statements, the equity of the purchaser held prior to the date of purchase is revalued according tothe fair value of the equity at the date of purchase, and the difference between the fair value and its book value is credited to thecurrent investment income; If the shares held by the purchaser prior to the date of purchase involve other consolidated gains underthe equity law accounting, the other consolidated gains related thereto shall be converted to the current gains on the date of purchase,with the exception of the other consolidated gains arising from the remeasurement of the net assets or net liabilities of the mergedparty. The company disclosed in the notes the fair value of the equity of the purchased party held before the purchase date and theamount of related gains or losses remeasured according to the fair value.
(3) The Company disposes of long-term equity investment in subsidiaries without losing control
The parent company partially disposes of the long-term equity investment in the subsidiary company without losing control. Inthe consolidated financial statements, the disposal price corresponds to the disposal of the long-term equity investment. Thedifference between the shares is adjusted for the capital reserve (capital premium or equity premium). If the capital reserve isinsufficient to offset, the retained earnings are adjusted.
④ The company disposes of long-term equity investment in subsidiaries and loses control
A. One transaction disposition
If the Company loses control over the Invested Party due to the disposal of part of the equity investment, it shall remeasure theremaining equity according to its fair value at the date of loss of control when compiling the consolidated financial statement. Thesum of the consideration obtained from the disposal of equity and the fair value of the remaining equity minus the difference betweenthe share of the original subsidiary 's net assets that should be continuously calculated from the purchase date or the merger date,calculated as the loss of control The investment income of the current period.
Other comprehensive income and other owner's equity changes related to the equity investment of the atomic company aretransferred to the current profit and loss when the control is lost, except for other comprehensive income arising from theremeasurement of the net benefits or net assets of the defined benefit plan by the investee. .
B. Multi-transaction step-by-step disposition
In consolidated financial statements, you should first determine whether a step-by-step transaction is a "blanket transaction".
If the step-by-step transaction does not belong to a "package deal", in the individual financial statements, for each transaction
before the loss of control of the subsidiary, the book value of the long-term equity investment corresponding to each disposal ofequity is carried forward, the price received and the disposal The difference between the book value of the long-term equityinvestment is included in the current investment income; in the consolidated financial statements, it should be handled in accordancewith the relevant provisions of "the parent company disposes of the long-term equity investment in the subsidiary without losingcontrol."If a step-by-step transaction belongs to a "blanket transaction", the transaction shall be treated as a transaction that disposes ofthe subsidiary and loses control; In individual financial statements, the difference between each disposal price before the loss ofcontrol and the book value of the long-term equity investment corresponding to the equity being disposed of is first recognized asother consolidated gains and then converted to the current loss of control at the time of the loss of control; In the consolidatedfinancial statements, for each transaction prior to the loss of control, the difference between the disposition of the price and thedisposition of the investment corresponding to the share in the net assets of the subsidiary shall be recognized as other consolidatedgains and shall, at the time of the loss of control, be transferred to the loss of control for the current period.
Where the terms, conditions, and economic impact of each transaction meet one or more of the following conditions, usuallymultiple transactions are treated as a "package deal":
(a) These transactions were concluded at the same time or in consideration of mutual influence.
(b) These transactions can only achieve the business result as a whole;
(c) The effectiveness of one transaction depends the occurance of at least another transaction;
(d) A single transaction is not economic and is economic when considered together with other transactions.
(5) Proportion of minority shareholders in factor companies who increase capital and dilute ownership of parent companies
Proportion of Others （ minority shareholders in factor companies who increase capital , dilute Subsidiaries of parent companies.In the consolidated financial statements, the share of the parent company in the net book assets of the former subsidiary of the capitalincrease is calculated according to the share ratio of the parent company before the capital increase, the difference between the shareand the net book assets of the latter subsidiary after the capital increase is calculated according to the share ratio of the parentcompany, the capital reserve (capital premium or capital premium), the capital reserve (capital premium or capital premium) is notoffset, and the retained income is adjusted.
7. Recognition of cash and cash equivalents
Cash refers to cash in stock and deposits that can be used for payment at any time. Cash equivalents refer to investments with ashort holding period (generally referring to expiry within three months from the date of purchase), strong liquidity, easy to convert toa known amount of cash, and little risk of value change.
8.Foreign exchange business and foreign exchange statement translation
(1) Methods for determining conversion rates in foreign currency transactions
When the company's foreign currency transactions are initially confirmed, they will be converted into the bookkeepingstandard currency at the spot exchange rate on the transaction date.
(2) Methods of conversion of foreign currency currency currency items on balance sheet days
At the balance sheet date, foreign currency items are translated on the spot exchange rate of the balance sheet date. Theexchange differences caused by the difference in exchange rates on the balance sheet date and initial recognizing date or previous
balance sheet date are included in the current profits and losses. Non-monetary items accounted in foreign currency and on historicalcosts are exchanged with the spot exchange rate on the transaction date. Non-monetary items accounted in foreign currency and onfair value are exchanged with the spot exchange rate on the determination date of the fair value. The exchange difference between theaccounting standard-currency amount and the original accounting standard-currency amount are included in the current profits andlosses.
(3) Foreign currency statement conversion method
Prior to the conversion of the financial statements of an enterprise's overseas operations, the accounting period and policy ofthe overseas operations should be adjusted to conform to the accounting period and policy of the enterprise. The financial statementsof the corresponding currency (other than the functional currency) should be prepared according to the adjusted accounting policyand the accounting period. The financial statements of the overseas operations should be converted according to the followingmethods:
① The assets and liabilities items in the balance sheet are translated at the spot exchange rate on the balance sheet date. Exceptfor the "undistributed profits" items, the owner's equity items are translated at the spot exchange rate when they occur.
② The income and expense items in the profit statement are converted at the spot exchange rate on the transaction date or theapproximate exchange rate of the spot exchange rate.
③ The foreign currency cash flow and the foreign subsidiary's cash flow are converted using the immediate exchange rate orthe approximate exchange rate at the date of the cash flow. The impact of exchange rate changes on cash should be used as anadjustment item and presented separately in the cash flow statement.
④ During the preparation of the consolidated financial statements, the resulting foreign currency financial statementconversion variance is presented separately under the owner's equity item in the consolidated balance sheet.
When foreign operations are disposed of and the control rights are lost, the difference in foreign currency statements related tothe overseas operations that are listed in the shareholders' equity items in the balance sheet is transferred to the profit or loss for thecurrent period, either in whole or in proportion to the disposal of the foreign operations.
9. Financial instrument
Financial instrument refers to a company’s financial assets and contracts that form other units of financial liabilities or equityinstruments.
(1) Recognition and de-recognition of financial instrument
The Company recognizes a financial asset or liability when it becomes one party in the financial instrument contract.
Financial asset is derecognized when:
① The contractual right to receive the cash flows of the financial assets is terminated;
② The financial asset is transferred and meets the following derecognition condition.
If the current obligation of a financial liability (or part of it) has been discharged, the company derecognises the financialliability (or part of the financial liability). When the Company (borrower) and lender enter into an agreement to replace the originalfinancial liabilities by undertaking new financial liabilities and the contract terms for the new financial liabilities are essentiallydifferent from those for the original one, the original financial liabilities will be derecognized and new financial liabilities will berecognized. Where the Company makes substantial amendments to the contract terms of the original financial liability (or partthereof), it shall terminate the original financial liability and confirm a new financial liability in accordance with the amended terms.
Financial asset transactions in regular ways are recognized and de-recognized on the transaction date. The conventional sale offinancial assets means the delivery of financial assets in accordance with the contractual terms and conditions, at the time set out inthe regulations or market practices. Transaction date refers to the date when the company promises to buy or sell financial assets.
(2) Classification and subsequent measurement of financial assets
At initial recognition, the Company classifies financial assets into the following three categories based on the business modelof managing financial assets and the contractual cash flow characteristics of financial assets: financial assets measured at amortizedcost are measured at fair value and their changes are included in other financial assets with current profit and loss and financial assetsmeasured at fair value through profit or loss. Unless the Company changes the business model for managing financial assets, in thiscase, all affected financial assets are reclassified on the first day of the first reporting period after the business model changes,otherwise the financial assets may not be initially confirmed.
Financial assets are measured at the fair value at the initial recognition. For financial assets measured at fair value withvariations accounted into current income account, related transaction expenses are accounted into the current income. For otherfinancial assets, the related transaction expenses are accounted into the initial recognized amounts. Bills receivable and accountsreceivable arising from the sale of commodities or the provision of labor services that do not contain or do not consider significantfinancing components, the company performs initial measurement according to the transaction price defined by the income standard.
The subsequent measurement of financial assets depends on their classification:
① Financial assets measured at amortized cost
Financial assets that meet the following conditions at the same time are classified as financial assets measured at amortized cost:
The company ’s business model for managing this financial asset is to collect contractual cash flows as its goal; the contract terms ofthe financial asset stipulate that Cash flow is only the payment of principal and interest based on the outstanding principal amount.For such financial assets, the actual interest rate method is used for subsequent measurement according to the amortized cost. Thegains or losses arising from the termination of recognition, amortization or impairment based on the actual interest rate method areincluded in the current profit and loss.
② Financial assets measured at fair value and whose changes are included in other comprehensive income
Financial assets that meet the following conditions at the same time are classified as financial assets measured at fair value andtheir changes are included in other comprehensive income: The company's business model for managing this financial asset is to bothtarget the collection of contractual cash flows and the sale of financial assets. Objective; The contractual terms of the financial assetstipulate that the cash flow generated on a specific date is only for the payment of principal and interest based on the outstandingprincipal amount. For such financial assets, fair value is used for subsequent measurement. Except for impairment losses or gains andexchange gains and losses recognized as current gains and losses, changes in the fair value of such financial assets are recognized asother comprehensive income. Until the financial asset is derecognized, its accumulated gains or losses are transferred to current gainsand losses. However, the relevant interest income of the financial asset calculated by the actual interest rate method is included in thecurrent profit and loss.
The Company irrevocably chooses to designate a portion of non-tradable equity instrument investment as a financial assetmeasured at fair value and whose variation is included in other consolidated income. Only the relevant dividend income is includedin the current profit and loss, and the variation of fair value is recognized as other consolidated income.
③ Financial assets measured at fair value with variations accounted into current income account
The above financial assets measured at amortized cost and other financial assets measured at fair value and whose changes areincluded in other comprehensive income are classified as financial assets measured at fair value and whose changes are included inthe current profit and loss. For such financial assets, fair value is used for subsequent measurement, and all changes in fair value are
included in current profit and loss.
(3) Classification and measurement of financial liabilities
The company classifies financial liabilities into financial liabilities measured at fair value and their changes included in thecurrent profit and loss, loan commitments and financial guarantee contract liabilities for loans below market interest rates, andfinancial liabilities measured at amortized cost.The subsequent measurement of financial liabilities depends on their classification:
① Financial liabilities measured at fair value with variations accounted into current income account
Such financial liabilities include transactional financial liabilities (including derivatives that are financial liabilities) andfinancial liabilities designated as at fair value through profit or loss. After the initial recognition, the financial liabilities aresubsequently measured at fair value. Except for the hedge accounting, the gains or losses (including interest expenses) are recognizedin profit or loss. However, for the financial liabilities designated as fair value and whose variations are included in the profits andlosses of the current period, the variable amount of the fair value of the financial liability due to the variation of credit risk of thefinancial liability shall be included in the other consolidated income. When the financial liability is terminated, the cumulative gainsand losses previously included in the other consolidated income shall be transferred out of the other consolidated income and shall beincluded in the retained income.
② Loan commitments and financial security contractual liabilities
A loan commitment is a promise that the company provides to customers to issue loans to customers with established contractterms within the commitment period. Loan commitments are provided for impairment losses based on the expected credit loss model.
A financial guarantee contract refers to a contract that requires the company to pay a specific amount of compensation to thecontract holder who suffered a loss when a specific debtor is unable to repay the debt in accordance with the original or modifieddebt instrument terms. Financial guarantee contract liabilities are subsequently measured based on the higher of the loss reserveamount determined in accordance with the principle of impairment of financial instruments and the initial recognition amount afterdeducting the accumulated amortization amount determined in accordance with the revenue recognition principle.
③ Financial liabilities measured at amortized cost
After initial recognition, other financial liabilities are measured at amortized cost using the effective interest method.
Except in special circumstances, financial liabilities and equity instruments are distinguished according to the followingprinciples:
① If the company cannot unconditionally avoid delivering cash or other financial assets to fulfill a contractual obligation, thecontractual obligation meets the definition of financial liability. While some financial instruments do not explicitly contain terms andconditions for the delivery of cash or other financial assets, they may indirectly form contractual obligations through other terms andconditions.
If a financial instrument is required to be settled with or can be settled with the Company's own equity instruments, theCompany's own equity instrument used to settle the instrument needs to be considered as a substitute for cash or other financial assetsor for the holder of the instrument to enjoy the remaining equity in the assets after all liabilities are deducted. If it is the former, theinstrument is the financial liabilities of the issuer; if it is the latter, the instrument is the equity instrument of the issuer. In some cases,a financial instrument contract provides that the Company shall or may use its own instrument of interest, in which the amount of acontractual right or obligation is equal to the amount of the instrument of its own interest which may be acquired or deliveredmultiplied by its fair value at the time of settlement, whether the amount of the contractual right or obligation is fixed or is basedentirely or in part on a variation of a variable other than the market price of the instrument of its own interest, such as the rate of
interest, the price of a commodity or the price of a financial instrument, the contract is classified as a financial liability.
(4) Derivative financial instruments and embedded derivatives
Derivative financial instruments are initially measured at the fair value of the day when the derivative transaction contract issigned, and are subsequently measured at their fair values. Derivative financial instruments with a positive fair value are recognizedas asset, and instruments with a negative fair value are recognized as liabilities.The gains and losses arising from the change in fair value of derivatives are directly included in the profits and losses of thecurrent period, except that the part of the cash flow that is valid in the hedge is included in the other consolidated income andtransferred out when the hedged item affects the gain and loss of the current period.For a hybrid instrument containing an embedded derivative instrument, if the principal contract is a financial asset, the hybridinstrument as a whole applies the relevant provisions of the financial asset classification. If the main contract is not a financial asset,and the hybrid instrument is not measured at fair value and its changes are included in the current profit and loss for accounting, theembedded derivative does not have a close relationship with the main contract in terms of economic characteristics and risks, and it isIf the instruments with the same conditions and exist separately meet the definition of derivative instruments, the embeddedderivative instruments are separated from the mixed instruments and treated as separate derivative financial instruments. If the fairvalue of the embedded derivative on the acquisition date or the subsequent balance sheet date cannot be measured separately, thehybrid instrument as a whole is designated as a financial asset or financial liability measured at fair value and whose changes areincluded in the current profit or loss.
(5) Financial instrument Less
The Company shall confirm the preparation for loss on the basis of expected credit loss for financial assets measured atamortization costs, creditor's rights investments measured at fair value, contractual assets, leasing receivables, loan commitments andfinancial guarantee contracts, etc.
① Measurement of expected credit losses of accounts receivable
The expected credit loss refers to the weighted average of the credit losses of financial instruments that are weighted by the riskof default. Credit loss refers to the difference between all contractual cash flows receivable from the contract and all cash flowsexpected to be received by the Company at the original actual interest rate, that is, the present value of all cash shortages. Amongthem, the financial assets which have been purchased or born by the Company shall be discounted according to the actual rate ofcredit adjustment of the financial assets.
The expected lifetime credit loss is the expected credit loss due to all possible default events during the entire expected life ofthe financial instrument.
Expected credit losses in the next 12 months are expected to result from possible defaults in financial instruments within 12months after the balance sheet date (or estimated duration of financial instruments if the expected duration is less than 12 months)Credit losses are part of the expected lifetime credit loss.
On each balance sheet day, the company measures the expected credit losses of financial instruments at different stages. Wherethe credit risk has not increased significantly since the initial confirmation of the financial instrument, it is in the first stage. TheCompany measures the preparation for loss according to the expected credit loss in the next 12 months. Where the credit risk hasincreased significantly since the initial confirmation but the credit impairment has not occurred, the financial instrument is in thesecond stage. Where a credit impairment has occurred since the initial confirmation of the financial instrument, it shall be in the thirdstage, and the Company shall prepare for measuring the expected credit loss of the whole survival period of the instrument.
For financial instruments with low credit risk on the balance sheet date, the company assumes that the credit risk has notincreased significantly since the initial recognition, and measures the loss provision based on the expected credit losses in the next 12
months.For financial instruments that are in the first and second stages and with lower credit risk, the company calculates interestincome based on their book balances and actual interest rates without deduction for impairment provision. For financial instrumentsin the third stage, interest income is calculated based on the amortized cost and the actual interest rate after the book balance minusthe provision for impairment.Regarding bills receivable, accounts receivable and financing receivables, regardless of whether there is a significant financingcomponent, the company measures the loss provision based on the expected credit losses throughout the duration.A Accounts receivableWhere there is objective evidence of impairment, as well as other receivable instruments, receivables, other receivables,receivables financing and long-term receivables applicable to individual assessments, separate impairment tests are performed toconfirm expected credit losses and prepare individual impairment. For notes receivable, accounts receivable, other receivables,financing of receivables and long-term receivables for which there is no objective evidence of impairment, or when individualfinancial assets cannot be assessed at a reasonable cost, the company divides bills receivable, accounts receivable, other receivables,receivable financing and long-term receivables into several combinations based on credit risk characteristics, and calculates expectedcredit losses on the basis of the combination. The basis for determining the combination is as follows:
The basis for determining the combination of notes receivable is as follows:
Notes Receivable Combination 1 Commercial Acceptance BillNotes Receivable Combination 2 Bank Acceptance BillFor Notes receivable divided into portfolios, the company refers to historical credit loss experience, combined with currentconditions and predictions of future economic conditions, and calculates through default risk exposure and expected credit loss ratewithin the next 12 months or the entire duration Expected credit losses.The basis for determining the combination of accounts receivable is as follows:
Accounts receivable combination 1 Accounts receivable businessOther receivable portfolio 2 Receivables from related parties within the scope of consolidationAccounts receivable combination 3 Real estate receivable businessAccounts receivable combination 4 Others receivable businessFor the accounts receivable divided into a combination, the company refers to the historical credit loss experience, combinedwith the current situation and the forecast of the future economic situation, compiles the account receivable age and the wholeexpected credit loss rate table, and calculates the expected credit loss.The basis for determining the combination of other receivables is as follows:
Other receivable portfolio 1 Interest receivablePortfolio of other receivables 2 Dividends receivableOther combinations of receivables 3 Deposit and margin receivableOther receivable portfolio 4 Receivable advancesCombination of other receivables 5 Value-added tax receivable is increased and refundedOther receivable portfolio 6 Receivables from related parties within the scope of consolidation
Other receivables portfolio 7 Other receivablesFor other receivables divided into portfolios, the company refers to historical credit loss experience, combined with currentconditions and predictions of future economic conditions, and calculates through default risk exposure and expected credit loss ratewithin the next 12 months or the entire duration Expected credit losses.The basis for determining the combination of receivables financing is as follows:
Receivables financing portfolio 1 bank acceptance billFor Notes receivable divided into portfolios, the company refers to historical credit loss experience, combined with currentconditions and predictions of future economic conditions, and calculates through default risk exposure and expected credit loss ratewithin the next 12 months or the entire duration Expected credit losses.Other debt investmentFor other receivables divided into portfolios, the company refers to historical credit loss experience, combined with currentconditions and predictions of future economic conditions, and calculates through default risk exposure and expected credit loss ratewithin the next 12 months or the entire duration Expected credit losses.
② Lower credit risk
If the risk of default on financial instruments is low, the borrower’s ability to meet its contractual cash flow obligations in theshort term is strong, and even if the economic situation and operating environment are adversely changed over a long period of time,it may not necessarily reduce the receivables' performance of their contractual cash. The ability of the flow obligation, the financialinstrument is considered to have a lower credit risk.
③ Significant increase in credit risk
The company compares the default probability of the financial instrument during the expected lifetime determined by thebalance sheet date with the default probability of the expected lifetime during the initial confirmation to determine the relativeprobability of the default probability of the financial instrument during the expected lifetime Changes to assess whether the creditrisk of financial instruments has increased significantly since initial recognition.
In determining whether the credit risk has increased significantly since the initial recognition, the Company considersreasonable and evidenced information, including forward-looking information, that can be obtained without unnecessary additionalcosts or effort. The information considered by the company includes:
A. Significant changes in internal price indicators resulting from changes in credit risk;
B. Adverse changes in business, financial or economic conditions that are expected to cause significant changes in the debtor’sability to perform its debt service obligations;
C. Whether the actual or expected operating results of the debtor have changed significantly; whether the regulatory, economicor technical environment of the debtor has undergone significant adverse changes;
D. Whether there is a significant change in the value of the collateral used as debt collateral or the guarantee provided by athird party or the quality of credit enhancement. These changes are expected to reduce the debtor’s economic motivation forrepayment within the time limit specified in the contract or affect the probability of default;
E. Whether there is a significant change in the economic motivation that is expected to reduce the debtor's repayment accordingto the contractual deadline;
F. Anticipated changes to the loan contract, including whether the expected violation of the contract may result in theexemption or revision of contract obligations, granting interest-free periods, rising interest rates, requiring additional collateral or
guarantees, or making other changes to the contractual framework of financial instruments change;G. Whether the expected performance and repayment behavior of the debtor has changed significantly;H. Whether the contract payment is overdue for more than (including) 30 days.Based on the nature of financial instruments, the Company assesses whether credit risk has increased significantly on the basisof a single financial instrument or combination of financial instruments. When conducting an assessment based on a combination offinancial instruments, the Company can classify financial instruments based on common credit risk characteristics, such as overdueinformation and credit risk ratings.If the overdue period exceeds 30 days, the company has determined that the credit risk of financial instruments has increasedsignificantly. Unless the Company does not have to pay excessive costs or efforts to obtain reasonable and warranted information, itproves that although it has exceeded the time limit of 30 days agreed upon in the Contract, credit risks have not increasedsignificantly since the initial confirmation.
④ Financial assets with credit impairment
The company assesses on the balance sheet date whether financial assets measured at amortized cost and credit investmentsmeasured at fair value and whose changes are included in other comprehensive income have undergone credit impairment. When oneor more events that adversely affect the expected future cash flows of a financial asset occur, the financial asset becomes a financialasset that has suffered a credit impairment. Evidence that credit impairment has occurred in financial assets includes the followingobservable information:
Major financial difficulties have occurred to the issuer or the debtor; Breach of contract by the debtor, such as payment ofinterest or default or overdue of principal; (B) The concession that the debtor would not make under any other circumstances foreconomic or contractual considerations relating to the financial difficulties of the debtor; The debtor is likely to be bankrupt orundertake other financial restructuring; The financial difficulties of the issuer or debtor lead to the disappearance of the active marketfor the financial asset; To purchase or generate a financial asset at a substantial discount, which reflects the fact that a credit loss hasoccurred.
⑤ Presentation of expected credit loss measurement
In order to reflect the changes in the credit risk of financial instruments since the initial recognition, the Company re-measuresthe expected credit losses on each balance sheet date, and the increase or reversal of the loss provision resulting therefrom is includedas an impairment loss or gain. Current profit and loss. For financial assets measured at amortized cost, the loss allowance offsets thebook value of the financial asset listed on the balance sheet; for debt investments measured at fair value and whose changes areincluded in other comprehensive income, the company Recognition of its loss provisions in gains does not offset the book value ofthe financial asset.
⑥ Canceled
If it is no longer reasonably expected that the contract cash flow of the financial assets will be fully or partially recovered, thebook balance of the financial assets will be directly reduced. Such write-off constitute the derecognition of related financial assets.This usually occurs when the company determines that the debtor has no assets or sources of income that generate sufficient cashflow to cover the amount that will be written down.
If the financial assets that have been written down are recovered in the future, the reversal of the impairment loss is included inthe profit or loss of the current period.
(6) Transfer of financial assets
The transfer of financial assets refers to the following two situations:
A. Transfer the contractual right to receive cash flow of financial assets to another party;B. Transfers the financial assets to the other party in whole or in part, but reserves the contractual right to collect the cash flowof the financial assets and undertakes the contractual obligation to pay the collected cash flow to one or more recipients.
① De-identification of transferred financial assets
Those who have transferred almost all risks and rewards in the ownership of financial assets to the transferee, or have neithertransferred nor retained almost all the risks and rewards in the ownership of financial assets, but have given up control of thefinancial assets, terminate the confirmation The financial asset.In determining whether control over the transferred financial asset has been waived, the actual capacity of the transferor to sellthe financial asset is determined. If the transferor is able to sell the transferred financial assets wholly to a third party that does nothave a relationship with them, and has no additional conditions to limit the sale, it indicates ds has waived control over the financialassets.The company pays attention to the essence of financial asset transfer when judging whether financial asset transfer meets thecondition of financial asset termination.If the overall transfer of financial assets meets the conditions for termination of confirmation, the difference between thefollowing two amounts is included in the current profit and loss:
A. Continuing identification of transferred Book value；
B. The sum of the amount received as a result of the transfer and the amount accrued as a result of the change in the fair valueof the transfer in respect of the termination recognized portion of the amount previously charged directly to the other consolidatedproceeds (the financial assets involved in the transfer are those classified in accordance with Article 18 of Enterprise AccountingStandard No. 22 - Financial Instruments Recognition and Measurement as measured by the fair value and whose change is charged tothe other consolidated proceeds).
If the partial transfer of financial assets meets the conditions for derecognition, the book value of the entire transferred financialassets will be included in the derecognized part and the unterminated part (in this case, the retained service assets are regarded as partof the continued recognition of financial assets) Between them, they are apportioned according to their respective relative fair valueson the transfer date, and the difference between the following two amounts is included in the current profit and loss:
A. Termination of the book value of the recognized portion on the date of derecognition;
B. The sum of the amount received as a result of the transfer and the amount accrued as a result of the change in the fair valueof the transfer in respect of the termination recognized portion of the amount previously charged to the other consolidated proceeds(the financial assets involved in the transfer are those classified in accordance with Article 18 of Enterprise Accounting Standard No.22 - Financial Instruments Recognition and Measurement as measured by the fair value and whose change is charged to the otherconsolidated proceeds).
② Continue to be involved in the transferred financial assets
If neither transfer nor retain almost all the risks and rewards of the ownership of financial assets, and have not given up controlof the financial assets, the relevant financial assets should be confirmed according to the extent of their continued involvement in thetransferred financial assets, and the relevant liabilities should be recognized accordingly.
The extent to which the transferred financial assets continue to be involved refers to the extent to which the enterpriseundertakes the risk or compensation of the value change of the transferred financial assets.
(III) Continuing identification of transferred financial assets
Where almost all risks and remuneration in relation to ownership of the transferred financial assets are retained, the whole ofthe transferred financial assets shall continue to be recognized and the consideration received shall be recognized as a financialliability.The financial asset and the recognized related financial liabilities shall not offset each other. In the subsequent accountingperiod, the enterprise shall continue to recognize the income (or gain) generated by the financial asset and the costs (or losses)incurred by the financial liability.
(7) Deduction of financial assets and liabilities
Financial assets and financial liabilities should be listed separately in the balance sheet, and cannot be offset against each other.However, if the following conditions are met, the net amount offset by each other is listed in the balance sheet:
The company has a statutory right to offset the confirmed amount, and such legal right is currently enforceable;
The company plans to settle the net assets or realize the financial assets and liquidate the financial liabilities at the same time.
The transferring party shall not offset the transferred financial assets and related liabilities if it does not meet the conditions forterminating the recognition.
(8) Recognition of fair value of Finance instruments
For the method for determining the fair value of financial assets and financial liabilities, see 30 (1) Fair value measurement inthis section, V. Important accounting policies and accounting estimates.
10. Notes receivable
For details, please refer to 11. Accounts Receivable in V. Important Accounting Policies and Accounting Estimates in thissection.
11. Account receivable
The Company shall confirm the preparation for loss on the basis of expected credit loss for financial assets measured atamortization costs, creditor's rights investments measured at fair value, contractual assets, leasing receivables, loan commitments andfinancial guarantee contracts, etc.
① Measurement of expected credit losses of accounts receivable
The expected credit loss refers to the weighted average of the credit losses of financial instruments that are weighted by the riskof default. Credit loss refers to the difference between all contractual cash flows receivable from the contract and all cash flowsexpected to be received by the Company at the original actual interest rate, that is, the present value of all cash shortages. Amongthem, the financial assets which have been purchased or born by the Company shall be discounted according to the actual rate ofcredit adjustment of the financial assets.
The expected lifetime credit loss is the expected credit loss due to all possible default events during the entire expected life ofthe financial instrument.
Expected credit losses in the next 12 months are expected to result from possible defaults in financial instruments within 12months after the balance sheet date (or estimated duration of financial instruments if the expected duration is less than 12 months)Credit losses are part of the expected lifetime credit loss.
On each balance sheet day, the company measures the expected credit losses of financial instruments at different stages. Where
the credit risk has not increased significantly since the initial confirmation of the financial instrument, it is in the first stage. TheCompany measures the preparation for loss according to the expected credit loss in the next 12 months. Where the credit risk hasincreased significantly since the initial confirmation but the credit impairment has not occurred, the financial instrument is in thesecond stage. Where a credit impairment has occurred since the initial confirmation of the financial instrument, it shall be in the thirdstage, and the Company shall prepare for measuring the expected credit loss of the whole survival period of the instrument.For financial instruments with low credit risk on the balance sheet date, the company assumes that the credit risk has notincreased significantly since the initial recognition, and measures the loss provision based on the expected credit losses in the next 12months.For financial instruments that are in the first and second stages and with lower credit risk, the company calculates interestincome based on their book balances and actual interest rates without deduction for impairment provision. For financial instrumentsin the third stage, interest income is calculated based on the amortized cost and the actual interest rate after the book balance minusthe provision for impairment.Regarding bills receivable, accounts receivable, contract assets and financing receivables, regardless of whether there is asignificant financing component, the company measures the loss provision based on the expected credit losses throughout theduration.A Accounts receivableWhere there is objective evidence of impairment, as well as other receivable instruments, receivables, other receivables,receivables financing and long-term receivables applicable to individual assessments, separate impairment tests are performed toconfirm expected credit losses and prepare individual impairment. For notes receivable, accounts receivable, other receivables,financing of receivables and long-term receivables for which there is no objective evidence of impairment, or when individualfinancial assets cannot be assessed at a reasonable cost, the company divides bills receivable, accounts receivable, other receivables,receivable financing and long-term receivables into several combinations based on credit risk characteristics, and calculates expectedcredit losses on the basis of the combination. The basis for determining the combination is as follows:
The basis for determining the combination of notes receivable is as follows:
Notes Receivable Combination1 Commercial Acceptance BillNotes Receivable Combination1 Commercial Acceptance BillFor Notes receivable divided into portfolios, the company refers to historical credit loss experience, combined with currentconditions and predictions of future economic conditions, and calculates through default risk exposure and expected credit loss ratewithin the next 12 months or the entire duration Expected credit losses.The basis for determining the combination of accounts receivable is as follows:
Accounts receivable combination 1 Accounts receivable businessOther receivable portfolio 2 Receivables from related parties within the scope of consolidationAccounts receivable combination 3 Real estate receivable businessAccounts receivable combination 4 Others receivable businessFor the accounts receivable divided into a combination, the company refers to the historical credit loss experience, combinedwith the current situation and the forecast of the future economic situation, compiles the account receivable age and the wholeexpected credit loss rate table, and calculates the expected credit loss.
The basis for determining the combination of contract assets and the method for calculating expected credit losses are the same
as accounts receivable.
The basis for determining the combination of other receivables is as follows:
Other receivable portfolio 1 Interest receivablePortfolio of other receivables 2 Dividends receivableOther combinations of receivables 3 Deposit and margin receivableOther receivable portfolio 4 Receivable advancesCombination of other receivables 5 Value-added tax receivable is increased and refundedOther receivable portfolio 6 Receivables from related parties within the scope of consolidationOther receivables portfolio 7 Other receivablesFor other receivables divided into portfolios, the company refers to historical credit loss experience, combined with currentconditions and predictions of future economic conditions, and calculates through default risk exposure and expected credit loss ratewithin the next 12 months or the entire duration Expected credit losses.The basis for determining the combination of receivables financing is as follows:
Receivables financing portfolio 1 bank acceptance billFor Notes receivable divided into portfolios, the company refers to historical credit loss experience, combined with currentconditions and predictions of future economic conditions, and calculates through default risk exposure and expected credit loss ratewithin the next 12 months or the entire duration Expected credit losses.Other debt investmentFor other receivables divided into portfolios, the company refers to historical credit loss experience, combined with currentconditions and predictions of future economic conditions, and calculates through default risk exposure and expected credit loss ratewithin the next 12 months or the entire duration Expected credit losses.
② Lower credit risk
If the risk of default on financial instruments is low, the borrower’s ability to meet its contractual cash flow obligations in theshort term is strong, and even if the economic situation and operating environment are adversely changed over a long period of time,it may not necessarily reduce the receivables' performance of their contractual cash. The ability of the flow obligation, the financialinstrument is considered to have a lower credit risk.
③ Significant increase in credit risk
The company compares the default probability of the financial instrument during the expected lifetime determined by thebalance sheet date with the default probability of the expected lifetime during the initial confirmation to determine the relativeprobability of the default probability of the financial instrument during the expected lifetime Changes to assess whether the creditrisk of financial instruments has increased significantly since initial recognition.
In determining whether the credit risk has increased significantly since the initial recognition, the Company considersreasonable and evidenced information, including forward-looking information, that can be obtained without unnecessary additionalcosts or effort. The information considered by the company includes:
A. Significant changes in internal price indicators resulting from changes in credit risk;
B. Adverse changes in business, financial or economic conditions that are expected to cause significant changes in the debtor’sability to perform its debt service obligations;C. Whether the actual or expected operating results of the debtor have changed significantly; whether the regulatory, economicor technical environment of the debtor has undergone significant adverse changes;
D. Whether there is a significant change in the value of the collateral used as debt collateral or the guarantee provided by athird party or the quality of credit enhancement. These changes are expected to reduce the debtor’s economic motivation forrepayment within the time limit specified in the contract or affect the probability of default;
E. Whether there is a significant change in the economic motivation that is expected to reduce the debtor's repayment accordingto the contractual deadline;
F. Anticipated changes to the loan contract, including whether the expected violation of the contract may result in theexemption or revision of contract obligations, granting interest-free periods, rising interest rates, requiring additional collateral orguarantees, or making other changes to the contractual framework of financial instruments change;
G. Whether the expected performance and repayment behavior of the debtor has changed significantly;
H. Whether the contract payment is overdue for more than (including) 30 days.
Based on the nature of financial instruments, the Company assesses whether credit risk has increased significantly on the basisof a single financial instrument or combination of financial instruments. When conducting an assessment based on a combination offinancial instruments, the Company can classify financial instruments based on common credit risk characteristics, such as overdueinformation and credit risk ratings.
If the overdue period exceeds 30 days, the company has determined that the credit risk of financial instruments has increasedsignificantly. Unless the Company does not have to pay excessive costs or efforts to obtain reasonable and warranted information, itproves that although it has exceeded the time limit of 30 days agreed upon in the Contract, credit risks have not increasedsignificantly since the initial confirmation.
④ Financial assets with credit impairment
The company assesses on the balance sheet date whether financial assets measured at amortized cost and credit investmentsmeasured at fair value and whose changes are included in other comprehensive income have undergone credit impairment. When oneor more events that adversely affect the expected future cash flows of a financial asset occur, the financial asset becomes a financialasset that has suffered a credit impairment. Evidence that credit impairment has occurred in financial assets includes the followingobservable information:
Major financial difficulties have occurred to the issuer or the debtor; Breach of contract by the debtor, such as payment ofinterest or default or overdue of principal; (B) The concession that the debtor would not make under any other circumstances foreconomic or contractual considerations relating to the financial difficulties of the debtor; The debtor is likely to be bankrupt orundertake other financial restructuring; The financial difficulties of the issuer or debtor lead to the disappearance of the active marketfor the financial asset; To purchase or generate a financial asset at a substantial discount, which reflects the fact that a credit loss hasoccurred.
⑤ Presentation of expected credit loss measurement
In order to reflect the changes in the credit risk of financial instruments since the initial recognition, the Company re-measuresthe expected credit losses on each balance sheet date, and the increase or reversal of the loss provision resulting therefrom is includedas an impairment loss or gain. Current profit and loss. For financial assets measured at amortized cost, the loss allowance offsets thebook value of the financial asset listed on the balance sheet; for debt investments measured at fair value and whose changes are
included in other comprehensive income, the company Recognition of its loss provisions in gains does not offset the book value ofthe financial asset.
⑥ Canceled
If it is no longer reasonably expected that the contract cash flow of the financial assets will be fully or partially recovered, thebook balance of the financial assets will be directly reduced. Such write-off constitute the derecognition of related financial assets.This usually occurs when the company determines that the debtor has no assets or sources of income that generate sufficient cashflow to cover the amount that will be written down.If the financial assets that have been written down are recovered in the future, the reversal of the impairment loss is included inthe profit or loss of the current period.
The Company must comply with disclosure requirements of the Shenzhen Stock Exchange Industry Information DisclosureGuideline No.6 – Listed Companies Engaged in Decoration Business.
12. Receivable financing
For details, please refer to 11. Accounts Receivable in V. Important Accounting Policies and Accounting Estimates in thissection.
13. Other receivables
Methods for Determining Expected Credit Loss of Other Receivables and Accounting Processing Methods
For details, please refer to 11. Accounts Receivable in V. Important Accounting Policies and Accounting Estimates in thissection.
14. Inventories
(1) Classification of inventories
Inventory refers to the finished products or commodities held by the Company for sale in its daily activities, the materials andmaterials consumed in the course of production, in the course of production or in the course of providing labor services, includingsubcontracting materials, raw materials, in-process products, finished products, finished products, inventories, turnover materials,development costs, development products and assets formed by construction contracts, etc.
(2) Pricing of delivering inventory
Inventories are measured at cost when procured. Raw materials, products in process and commodity stocks in transit aremeasured by the weighted average method.
The real estate business inventory mainly includes inventory materials, products under development, completed developmentproducts, and development products intended to be sold but temporarily rented out. Inventory is measured at the actual costs whenthe fixed assets are obtained The actual costs of development products include land transfer payment, infrastructure and facility costs,installation engineering costs, borrows before completion of the development and other costs during the development process. Thespecial maintenance funds collected in the first period are included in the development overheads. The actual costs of thedevelopment product is priced using the separate pricing method.
Construction contracts are measured by the effective cost, including direct and indirect expenses generated before the contractsare fulfilled. Costs generated and recognized accumulatively by construction in process and settled payment are listed in the balancesheet as offset net amounts. The excessive part of the sum of the generated costs and recognized gross profit (loss) over the settledpayment is listed inventories; the excessive part of the settled payment over the sum of the generated costs and recognized grossprofit (loss) is listed as the prepayment received.Travel and bidding expenses generated by execution of contracts, if they can be separated and reliably measured and it is likelyto enter into contracts, are accounted as the contract cost when the contracts are entered into; or into the current gain/loss account ifthe conditions are not met.
(3) Inventory system
The company inventory adopts the perpetual inventory system, counting at least once a year, the inventory profit and lossamount is included in the current year's profit and loss.
(4) Recognition of inventory realizable value and providing of impairment provision
On the balance sheet date, inventories are accounted depending on which is lower between the cost and the net realizable value.If the cost is higher than the net realizable value, the impairment provision will be made.
The realizable net value of inventory should be recognized based on solid evidence with the purpose of the inventory andafter-balance-sheet-date events taken into consideration.
(1) In the course of normal production and operation, the net realizable value of finished goods, commodities and materialsdirectly used for sale shall be determined by the estimated price of the inventory minus the estimated cost of sale and related taxes.The inventory held for the execution of a sales contract or a labor contract shall be measured on the basis of the contract price as itsnet realizable value; If the quantity held is greater than the quantity ordered under the sales contract, the net realizable value of theexcess inventory is measured on the basis of the general sales price. For materials used for sale, the market price shall be used as themeasurement basis for the net realizable value.
②In the normal production and operation process, the inventory of materials that need to be processed is determined by theamount of the estimated selling price of the finished product minus the estimated cost to be incurred at the time of completion,estimated sales expenses and related taxes Realize the net value. If the net realizable value of the finished product produced by it ishigher than the cost, the material is measured at cost; If the decrease in the price of the material indicates that the net realizable valueof the finished product is lower than the cost, the material is measured as the net realizable value and the inventory is prepared for adecrease based on its difference.
③ Depreciation preparation of inventory is generally based on a single inventory item; For a large number of inventories witha lower unit price, they are accrued by inventory type.
④ If the factors affecting the previous write-down of inventory value have disappeared on the balance sheet date, the amountof the write-down will be restored and transferred back within the amount of inventory depreciation reserve that has been accrued,and the amount returned will be included in the current profit and loss.
(5) Methods of amortization of swing materials
① Low-value consumables are amortized on on-off amortization basis at using.
② Packages are amortized on on-off amortization basis at using.
15. Contract assets
The company lists the right to receive consideration for the transferred goods or services (the right depends on other factorsother than the passage of time) as a contract asset, and it is confirmed when it obtains the unconditional (that is, only depending onthe passage of time) right to receive payment Accounts receivable; on the contrary, the company's obligation to transfer goods orservices to customers for consideration received or receivable from customers is listed as contract liabilities. When the companyfulfills its obligations to transfer goods or provide services to customers, contract liabilities are recognized as revenue. The companypresents the contract assets and contract liabilities under the same contract as a net amount.Contract assets are recognized as impairment provision based on expected credit losses. For details, see 11. AccountsReceivable in 5. Important Accounting Policies and Accounting Estimates in this section.
16. Contract costs
If the cost incurred in fulfilling the contract does not fall within the scope of other accounting standards and meets the followingconditions at the same time, the company will recognize it as an asset as the contract performance cost:
(1) The cost is directly related to a current or expected contract, including direct labor, direct materials, manufacturing expenses(or similar expenses), clearly borne by the customer, and other costs incurred only due to the contract; ( 2) This cost increases thecompany's future resources for fulfilling its performance obligations; (3) This cost is expected to be recovered.
Assets related to the contract cost are amortized on the same basis as the commodity revenue recognition related to the asset andincluded in the current profit and loss.
If the book value of the asset related to the contract cost is higher than the difference between the following two items, the excesswill be provided for impairment and recognized as an asset impairment loss: (1) The company is expected to be able to transfer thegoods related to the asset The remaining consideration obtained; (2) is the estimated cost of transferring the relevant goods. If thedepreciation factors in the previous period have changed, and the difference between the aforementioned two items is higher than thebook value of the asset, the asset depreciation reserve that has been withdrawn should be reversed and included in the current profitand loss.
17. Long-term share equity investment
The Group's long-term equity investment includes control on invested entities and significant impacts on equity investment.Invested entities on which the Group has significant impacts are associates of the Group.
(1) Basis for recognition of common control and major influence on invested entities
Common control refers to the common control of an arrangement in accordance with the relevant agreement, and the relevantactivities of the arrangement must be agreed upon by the participants who share control. In determining whether there is commoncontrol, the first step is to determine whether all or a group of participants collectively control the arrangement, which is consideredcollective control by all or a group of participants if all or a group of participants must act together to determine the activitiesassociated with the arrangement. Secondly, it is judged whether the decision on related activities of the arrangement must be agreedby the participants who collectively control the arrangement. If there is a combination of two or more parties that can collectivelycontrol an arrangement, it does not constitute joint control. When judging whether there is joint control, the protective rights enjoyedare not considered.
Major influence refers to the power to participate in decision-making of financial and operation policies of a company, butcannot control or jointly control the making of the policies. When considering whether the Company can impose significant impactson the invested entity, impacts of conversion of shares with voting rights held directly or indirectly by the investor and voting rights
that can be executed in this period held by the investor and other party into shares of the invested entity should be considered.
If the Company directly or through subsidiaries holds more than 20% (inclusive) but less than 50% of the shares with votingrights of the invested entity, unless there is clear evidence proving that the Company cannot participate the decision-making ofproduction and operation of the invested entity, the Company has major influence on the invested entity.
(2) Recognition of initial investment costs
Long-term equity investments formed by merger of enterprises shall be determined in accordance with the following provisions:
A. In the case of an enterprise merger under the same control, where the merging party makes a valuation of the mergerby payment of cash, transfer of non-cash assets or undertaking liabilities, the share of the book value of the owner's interest inthe final controlling party's consolidated financial statements as the initial investment cost of the long-term equity investment atthe date of the merger. The difference between the initial investment cost of long-term equity investment and the cash paid, thetransferred non-cash assets and the book value of the debt assumed shall be adjusted to the capital reserve; if the capital reserveis insufficient to offset, the retained earnings shall be adjusted;Long-term equity investment generated by enterprise merger: for long-term equity investment obtained by merger ofenterprises under common control, the obtained share of book value of the interests of the merged party’s owner in theconsolidate financial statements on the merger date is costs; for long-term equity investment obtained by merger of enterprisesnot under common control, the merger cost is the investment cost. Adjust the capital reserve according to the difference betweenthe initial investment cost of long-term equity investment and the total face value of the issued shares. If the capital reserve isinsufficient to offset or reduce, the retained income shall be adjusted;For merger of entities under different control, the merger cost is the fair value of the asset paid, liability undertaken, andequity securities issued for exchanging of control power over the entities at the day of acquisition. Agency expenses and otheradministrative expenses such as auditing, legal consulting, or appraisal services occurred relating to the merger of entities areaccounted into current income account when occurred.Long-term equity investments formed by merger of enterprises shall be determined in accordance with the following provisions:
For long-term equity investment obtained by cash, the actually paid consideration is the initial investment cost. Initialinvestment costs include expenses, taxes and other necessary expenditures directly related to the acquisition of long-term equityinvestments;B. Long-term equity investments acquired from the issuance of interest securities are the initial investment costs based on thefair value of the issue interest securities;C. For long-term equity investments obtained through non-monetary asset exchanges, if the exchange has commercialsubstance and the fair value of the exchanged assets or exchanged assets can be reliably measured, the fair value of the exchangedassets and relevant taxes shall be used as the initial Investment cost, the difference between the fair value and book value of theswapped-out asset is included in the current profit and loss; if the non-monetary asset exchange does not meet the above twoconditions at the same time, the book value of the swapped-out asset and relevant taxes will be used as the initial investment cost.D. Long-term equity investments acquired through debt restructuring determine their recorded value at the fair value of thewaived claims and other costs such as taxes directly attributable to the assets and account for the difference between the fair valueand the book value of the waived claims.
(3) Subsequent measurement and recognition of gain/loss
The Company uses the cost method to measure long-term share equity investment in which the Company can control theinvested entity; and uses the equity method to measure long-term share equity investment in which the Company has substantialinfluence on the invested entity.
① Cost
For the long-term equity investment measured on the cost basis, except for the announced cash dividend or profit included inthe practical cost or price when the investment was made, the cash dividends or profit distributed by the invested entity arerecognized as investment gains in the current gain/loss account.EquityGains from long-term equity investment measured by equityWhen the equity method is used to measure long-term equity investment, the investment cost will not be adjusted if theinvestment cost of the long-term equity investment is larger than the share of fair value of the recognizable assets of the investedentity. When it is smaller than the share of fair value of the recognizable assets of the invested entity, the book value will be adjustedand the difference is included in the current gains of the investment.When the equity method is used, the current investment gain is the share of the net gain realized in the current year that can beshared or borne, recognized as investment gain and other misc. income. The book value of the long-term equity investment isadjusted accordingly. The book value of the long-term equity investment should be accordingly decreased based on the share of profitor cash dividend announced by the invested entity; according to other changes in the owner’s equity except for net profit and loss,other misc income and profit distribution of the invested entity, adjust the book value of the long-term equity investment and record itin the capital surplus (other capital surplus). When the share of the net gains that can be enjoyed is recognized, it is recognized afterthe net profit of the invested entity is adjusted based on the fair value of the recognizeable assets of the invested entity according tothe Company's accounting policies and accounting period. Where the accounting policy and accounting period adopted by theInvested unit are inconsistent with the Company, the financial statements of the Invested unit shall be adjusted in accordance with theaccounting policy and accounting period of the Company, and the investment income and other consolidated income shall berecognized. Internal transaction gain not realized between the Company and affiliates is measured according to the shareholdingproportion and the investment gains is recoginzied after deduction. The unrealized internal transaction loss between the Companyand the invested entity is the impairment loss of transferred assets and should not be written off.
Where substantial influence on invested entities is imposed or joint control is implemented due to increase in investment, thesum of the fair value of the original equity and increased investment on the conversion date is the initial investment cost under theequity method. The difference between the fair value and book value of the original equity on the conversion date and theaccumulative change in the fair value originally accounted in other misc. income should be transferred into the profit and loss of thecurrent period using the equity method.
Where joint control or substantial influence on invested entities is lost due to disposal of part of investment, the remainingequity after the disposal should be treated according to the Enterprise Accounting Standard No.22 – Recognition and Measurement ofFinancial Instruments from the date of losing the joint control or substantial influence. The difference between the fair value andbook value should be accounted the profit and loss of the current period. For other misc. incomes of original share equity investmentdetermined using the equity method, when the equity method is no longer used, it should be treated based on the same basis of thetreatment of related assets or liability of the invested entities; the other owners' interests related to the original share equityinvestment should be transferred to gain/loss of the current period.
(4) Equity investment held for sale
For the remaining equity investments not classified as assets held for sale, the equity method is adopted for accountingtreatment.
Equity investments classified as held for sale to associates that are no longer eligible to hold classified assets for sale areretrospectively adjusted using the equity method starting from the date that they are classified as held for sale. The classification isadjusted to hold the financial statements for the period to be sold.
(5) Impairment examination and providing of impairment provision
For investments in subsidiaries, associates and joint ventures, the method of accruing asset impairment is shown in 23.Long-term asset impairment in this section, V. Important accounting policies and accounting estimates.
XVIII. Investment real estates
(1) Classification of investment real estate
Investment real estates are held for rent or capital appreciation, or both. These include, inter alia:
① Leased land using right
(2) the right to use the land that is transferred after holding and preparing for the increment.
③ Leased building
(2) Measurement of investment real estate
For investment real estates with an active real estate transaction market and the Company can obtain market price and otherinformation of same or similar real estates to reasonably estimate the investment real estates’ fair value, the Company will use the fairvalue mode to measure the investment real estates subsequently. Variations in fair value are accounted into the current gain/lossaccount.
The fair value of investment real estates is determined with reference to the current market prices of same or similar realestates in active markets; when no such price is available, with reference to the recent transaction prices and consideration of factorsincluding transaction background, date and district to reasonably estimate the fair value; or based on the estimated lease gains andpresent value of related cash flows.
For investment real estate under construction (including investment real estate under construction for the first time), if the fairvalue cannot be reliably determined but the expected fair value of the real estate after completion is continuously and reliablyobtained, the investment real estate under construction is measured by cost. When the fair value can be measured reliably or aftercompletion (the earlier one), it is measured at fair value. For an investment real estate whose fair value is proven unable to beobtained continuously and reliably by objective evidence, the real estate will be measured at cost basis until it is disposed and noresidual value remains as assumed.
If the cost model is used for subsequent measurement of investment real estate, depreciation or amortization is calculatedaccording to the straight-line method after the cost of investment real estate minus accumulated impairment and net residual value.See this section, V. Important accounting policies, for the method of accruing asset impairment 23. Impairment of long-term assets inaccounting estimates.
The types of investment real estate, estimated economic useful life and estimated net residual value rate are determined asfollows:
| Type | Service year (year) | Residual rate % | Annual depreciation rate % |
| Houses & buildings | 35-50 | 10.00 | 1.80-2.57 |
19. Fixed assets
(1) Recognition conditions
Fixed assets is defined as the tangible assets which are held for the purpose of producing goods, providing services, lease or foroperation & management, and have more than one accounting year of service life. Fixed assets are recognized at the actual cost ofacquisition when the following conditions are met: (1) The economic benefits associated with the fixed assets are likely to flow intothe enterprise. ② The cost of the fixed assets can be measured reliably. Overhaul cost generated by regular examination on fixedassets is recognized as fixed assets costs when there is evidence proving that it meets fix assets recognition conditions. If not, it willbe accounted into the current gain/loss account.
(2) Depreciation method
| Type | Depreciation method | Service year | Residual rate | Annual depreciation rate % |
| Houses & buildings | Average age | 35-50 | 10.00% | 1.80%-2.57% |
| Mechanical equipment | Average age | 10.00 | 10.00% | 9.00% |
| Transportation facilities | Average age | 5.00 | 10.00% | 18.00% |
| Electronics and other devices | Average age | 5.00 | 10.00% | 18.00% |
| PV power plants | Average age | 20.00 | 5.00% | 4.75% |
The company calculates depreciation based on the average life method from the next month when the fixed assets reach the expectedusable state; for fixed assets for which depreciation provision is made, the depreciation rate will be determined after the accumulativedepreciation provision amount is deducted.At end of each fiscal year, verification will be made on the useful life, predicted retained value, and depreciation basis. The useful lifewill be adjusted if the useful life is different from the predicted one; the net residual value will be adjusted if the net residual value isdifferent from the predicted one.
(3) Recognition and pricing of financing leased fixed assets
The Company transfers all the risks and rewards attached to the asset at substantially transferred to the lessee, it is recognizedas financial leasing, and the others are operational leasing. The cost of a fixed asset acquired by a financial lease is determined on thebasis of the lower of the fair value of the leased asset at the date of the lease and the present value of the minimum leased payment.The Group adopts the depreciation policy same as the self-owned fixed assets to made provision for depreciation of leased assets.Depreciation shall be accrued within the life of the leased assets if it is possible to reasonably determine that the leased assets will beentitled to ownership upon the expiry of the lease term; Depreciation is accrued within a shorter period between the lease term andthe service life of the leased asset if it is unable to reasonably determine that the leased asset ownership can be acquired at the end ofthe lease term.
20. Construction in process
(1) Construction in progress is accounted for by project classification.
(2) Standard and timing for transferring construction in process into fixed assets
The full expenditure incurred on the construction-in-progress project as a fixed asset is recorded as the value of the assetbefore the asset is constructed to the intended usable state. This includes construction costs, the original cost of equipment, othernecessary expenditures incurred in order to enable the construction works to reach the intended usable status and the borrowing costsincurred for the specific borrowing of the project and the general borrowing expenses incurred before the assets reach the intendedusable status. Construction in process will be transferred to fixed assets when it reaches the preset service condition. The fixed assetsthat have reached the intended usable state but have not been completed shall be transferred to the fixed assets according to theestimated value according to the estimated value according to the estimated value according to the project budget, cost or actualproject cost, etc. The depreciation of the fixed assets shall be accrued according to the company's fixed assets depreciation policy.The original estimated value shall be adjusted according to the actual cost after the completion.
21. Borrowing expenses
(1) Recognition principles for capitalization of borrowing expenses
Borrowing expenses occurred to the Company that can be accounted as purchasing or production of asset satisfying theconditions of capitalizing, are capitalized and accounted as cost of related asset.
(1) Asset expenditure has occurred;
② The borrowing expense has already occurred;
③ Purchasing or production activity, which is necessary for the asset to reach the useful status, has already started.
Other interest on loans, discounts or premiums and exchange differences are included in the income and loss incurred in thecurrent period.
If the construction or production of assets satisfying the capitalizing conditions is suspended abnormally for over 3 months,capitalizing of borrowing expenses shall be suspended. During the normal suspension period, borrowing expenses will be capitalizedcontinuously.
When the asset satisfying the capitalizing conditions has reached its usable or sellable status, capitalizing of borrowingexpenses shall be terminated.
(2) Calculation of the capitalization amount of borrowing expense
Interest expenses generated by special borrowings less the interests income obtained from the deposit of unused borrowings orinvestment gains from temporary investment is capitalized; the capitalization amount for general borrowing is determined based onthe capitalization rate which is the exceeding part of the accumulative assets expense over weighted average of the assets expense ofthe special borrowing/used general borrowing.
If the assets that are constructed or produced under the condition of capitalization occupy the general borrowing, the interestamount to be capitalized in the general borrowing shall be calculated and determined by multiplying the capital rate of the generalborrowing by the weighted average of the asset expenditure of the accumulated assets whose expenditure exceeds that of thespecialized borrowing. The capitalization ratio is the weighted average interest rate of general borrowings.
22. Intangible assets
(1) Pricing method, service life and depreciation test
(1.1) Pricing of intangible assets
Recorded at the actual cost of acquisition.(1.2) Amortization of intangible assets
① Useful life of intangible assets with limited useful life
| Item | Estimated useful life | Basis |
| Land using right | Term | Use right assets |
| Trademarks and patents | 10 years | Reference to determine the lifetime of a company for which it can bring economic benefits |
| Proprietary technology | 10 years | Reference to determine the lifetime of a company for which it can bring economic benefits |
| Software | 5, 10 years | Reference to determine the lifetime of a company for which it can bring economic benefits |
At the end of each year, the Company will reexamine the useful life and amortization basis of intangible assets with limiteduseful life.
(2) Intangible assets which cannot be foreseeable to bring economic benefits to enterprises shall be regarded as intangibleassets whose useful life is uncertain. For intangible assets with uncertain service life, the company reviews the service life ofintangible assets with uncertain service life at the end of each year. If it is still uncertain after rechecking, it shall conduct animpairment test on the balance sheet date.
③ Amortization of intangible assets
For intangible assets with limited service life, the Company shall determine their service life at the time of acquisition, andshall use the straight line method system to reasonably amortize their service life, and the amortization amount shall be included inthe profit and loss of the current period according to the beneficial items. The specific amortization amount is the amount after thecost is deducted from the estimated residual value. For fixed assets for which depreciation provision is made, the depreciation ratewill be determined after the accumulative depreciation provision amount is deducted. The residual value of an intangible asset withlimited useful life is treated as zero, except where a third party undertakes to purchase the intangible asset at the end of its useful lifeor to obtain expected residual value information based on the active market, which is likely to exist at the end of its useful life.
Intangible assets with uncertain service life will not be amortized. At the end of each year, the useful life of intangible assetswith uncertain useful life is reviewed, and if there is evidence that the useful life of intangible assets is limited, the useful life isestimated and the system is reasonably amortized within the expected useful life.
(1.3) Impairment test of intangible assets
For details, see 23. Long-term asset impairment in this section, V. Important accounting policies and accounting estimates.
(2) Accounting policies for internal R&D expenses
(2.1) Specific standard for distinguish between research and development stage
① The company takes the information and related preparatory activities for further development activities as the researchstage, and the intangible assets expenditure in the research stage is included in the current profit and loss period.
② The development activities carried out after the company has completed the research stage as the development stage.
(2.2) Specific conditions for capitalization of expenditures in the development phase
Expenditures in the development phase can be recognized as intangible assets only when the following conditions are met:
A. It is technically feasible to complete the intangible asset so that it can be used or sold;B. Have the intention to complete the intangible asset and use or sell it;C. The way intangible assets generate economic benefits, including the ability to prove that the products produced by theintangible assets exist in the market or the intangible assets themselves exist in the market, and the intangible assets will be usedinternally, which can prove their usefulness;D. Have sufficient technical, financial and other resource support to complete the development of the intangible asset, andhave the ability to use or sell the intangible asset;E. The expenditure attributable to the development stage of the intangible asset can be reliably measured.
23. Assets impairment
The Group uses the cost mode to continue measuring the assets impairment to investment real estate, fixed assets constructionin progress, intangible assets and goodwill (except for the inventories, investment real estate measured by the fair value mode,deferred income tax assets and financial assets). The method is determined as follows:
The Company judges whether there is a sign of impairment to assets on the balance sheet day. If such sign exists, the Companyestimates the recoverable amount and conducts the impairment test. Impairment test is conducted annually for goodwill generated bymergers and intangible assets that have not reached the useful condition no matter whether the impairment sign exists.
The recoverable amount is determined by the higher of the net of fair value minus disposal expense and the present value ofthe predicted future cash flow. The Company estimates the recoverable amount on the individual asset item basis; whether it is hardto estimate the recoverable amount on the individual asset item basis, determine the recoverable amount based on the asset group thatthe assets belong to. The assets group is determined by whether the main cash flow generated by the group is independent from thosegenerated by other assets or assets groups.
When the recoverable amount of the assets or assets group is lower than its book value, the Company writes down the bookvalue to the recoverable amount, the write-down amount is accounted into the current income account and the assets impairmentprovision is made.
For goodwill impairment test, the book value of goodwill generated by mergers is amortized through reasonable measuressince the purchase day to related asset groups; those cannot be amortized to related assets groups are amortized to relatedcombination of asset groups. The related asset groups or combination of asset groups refer to those that can benefit from thesynergistic effect of mergers and must not exceed to the reporting range determined by the Company.
When the impairment test is conducted, if there is sign of impairment to the asset group or combination of asset groups relatedto goodwill, first perform impair test for asset group or combination of asset groups without goodwill and calculate the recoverableamount and recognize the related impairment loss. Then conduct impairment test on those with goodwill, compare the book valuewith recoverable amount. If the recoverable amount is lower than the book value, recognize the impairment loss of the goodwill.
Once recognized, the asset impairment loss cannot be written back in subsequent accounting period.
24. Long-term amortizable expenses
The long-term outstanding expenses shall be accounted for all expenses incurred by the Company but which shall be borne bythe current and future periods for more than one year, and the long-term outstanding expenses shall be amortized averagely within thebenefit period.
25. Contract liabilities
For details, please refer to 15. Contract assets in 5. Important accounting policies and accounting estimates in this section.
26. Staff remuneration
(1) Accounting of operational leasing
① Basic salary of employees (salary, bonus, allowance, subsidy)
In the accounting period for which the staff and workers provide services, the Company shall confirm the actual short-termremuneration as liabilities and shall account for the current income and loss, except as required or permitted by other accountingstandards.
② Employee welfare
The employee benefits incurred by the Company shall be included in the current profit and loss or related asset costs accordingto the actual amount incurred. Where the employee's benefit is non-monetary, it shall be measured on the basis of fair value.
③ Social insurance premiums and housing accumulation funds such as health insurance premiums, work injury premiums,birth insurance premiums, trade union funds and staff and education funds
The company pays the medical insurance premiums, work injury insurance premiums, birth insurance premiums, etc. socialinsurance premiums and housing accumulation funds for the staff and workers, as well as the union funds and the staff and workerseducation funds according to the regulations, in the accounting period for which the staff and workers provide services, thecorresponding salary amount of the staff and workers, and confirms the corresponding liabilities, which are included in the currentprofit and loss or related asset costs.
④ Short-term paid leave
The company accumulates the salary of the employees who are absent from work with pay when the employees provideservice, thus increasing their future right of absence with pay. The company confirms the salary of the employee related to theabsence of non-cumulative salary during the actual absence accounting period.
⑤ Short-term profit share program
If the profit-sharing plan meets the following conditions at the same time, the Company shall confirm the salary payable to thestaff and workers:
A. The legal or presumptive obligation of the enterprise to pay the remuneration of its employees as a result of past matters;
B. The amount of employee compensation obligations due to the profit sharing plan can be reliably estimated.
(2) Accounting of post-employment welfare
The post-employment welfare of the Group is a defined plan, which means that the Company does not need to assume anyresponsibility after making fixed contribution to an independent fund. The defined plan includes basic pension and unemploymentinsurance. The contribution of the plan is recognized as liabilities and recorded in the profit and loss of this period or related assetscosts.
(3) Accounting of dismiss welfare
If the company provides termination benefits to employees, the employee compensation liabilities arising from the terminationbenefits shall be recognized at the earliest of the following two and shall be included in the current profit and loss:
① An enterprise may not unilaterally withdraw the resignation benefits provided for by the dismissal plan or reductionproposal;
② When the enterprise recognizes the costs or expenses related to the reorganization involving the payment of resignationbenefits.
(4) Accounting of other long-term staff welfare
Inapplicable
27. Anticipated liabilities
(1) Recognition standards of anticipated liabilities
When responsibilities occurred in connection to contingent issues, and all of the following conditions are satisfied, they arerecognized as expectable liability in the balance sheet:
① This responsibility is a current responsibility undertaken by the Company;
② Execution of this responsibility may cause financial benefit outflow from the Company;
③ Amount of the liability can be reliably measured.
(2) Measurement of anticipated liabilities
Expected liabilities are initially measured at the best estimation on the expenses to exercise the current responsibility, and withconsiderations to the relative risks, uncertainty, and periodic value of currency. On each balance sheet date, review the book value ofthe estimated liabilities. Where there is conclusive evidence that the book value does not reflect the current best estimate, the bookvalue is adjusted to the current best estimate.
28. Revenue
The Company must comply with disclosure requirements of the Shenzhen Stock Exchange Industry Information DisclosureGuideline No.6 – Listed Companies Engaged in Decoration Business.
Specific revenue recognition method
① Construction contracts
The subway screen door project of the subsidiary Zhichuang Technology Company and the curtain wall decoration projects ofthe subsidiary Fangda Jianke Company are single construction contracts. The products produced by the company during theperformance of the contract have irreplaceable uses, and during the entire contract period The company has the right to collectpayment for the part of the contract that has been completed so far. The company recognizes revenue for this type of business withina period of time based on the progress of the contract. The accounting method is as follows:
When the contract between the company and the customer meets the following conditions at the same time, the company willconfirm the revenue and expenses of the construction contract on the balance sheet date according to the percentage of completion
method when the customer obtains control of the relevant goods: all parties to the contract have approved the contract and promisedto perform it Respective obligations; the contract clarifies the rights and obligations of the parties to the contract related to thetransferred goods or the provision of labor; the contract has clear payment terms related to the transferred goods; the contract hascommercial substance, that is, the performance of the contract will change the company The risk, time distribution or amount offuture cash flow; the consideration that the company has the right to obtain when transferring goods to customers is likely to berecovered.
Contract costs are direct and indirect expenses occurred since the date when the contract is engaged till the completion day.The competition percentage is determined by the share of the costs incurred in the total cost.Construction contracts completed in current term are recognized for income according to the actual total income of thecontract less income recognized in previous terms; meanwhile, the total costs of the contract less costs recognized in previous termsare recognized as current contract costs. If the total contract cost is predicted to be greater than the predicted total income, thepredicted loss shall be recognized as current cost instantly.
② Sales product
The company sells products and recognizes revenue when the customer obtains control of the relevant product. Revenue ofproducts for domestic sales is recognized when the Group delivers the products and receives the sales payment or obtains thepayment voucher; revenue for products for overseas sales is recognized at departure of the products.
The credit period granted by the company to customers is consistent with industry practices, and there is no major financingcomponent.
③ Real estate sales
The Company's real estate sales revenue is recognized when the control of the property is transferred to the customer. Basedon the terms of the sales contract and the legal provisions applicable to the contract, the control of the property can be transferredwithin a certain period of time or at a certain point in time. Only if the goods produced by the company during the performance of thecontract have irreplaceable uses, and the company has the right to collect payment for the cumulative performance part that has beencompleted during the entire contract period, the performance obligation has been completed during the contract period. The progressis recognized as revenue within a period of time, and the progress of the completed performance obligations is determined inaccordance with the ratio of the contract costs actually incurred to complete the performance obligations to the estimated total cost ofthe contract. Otherwise, the income is recognized when the customer obtains the physical ownership or legal ownership of thecompleted property and the company has obtained the current right of collection and is likely to recover the consideration.
The company’s existing property sales revenue is applicable to be recognized at a certain point in time, project is developedand completed with the record for the completion acceptance, the handover procedure is completed or property is deemed acceptedby the customer as per the property sales contract, the payment is received or it is believed that the payment can be received, and thecost can be measured reliably.Accounting policies used in revenue recognition and measurement
The company recognizes revenue based on the expected amount of consideration that is entitled to receive when the customerobtains control of the relevant goods or services.
29. Government subsidy
(1) Government subsidy
Government subsidies are recognized when the following conditions are met:
(1) Requirements attached to government subsidies;
(2) The company can receive government subsidies.
(2) Government subsidy
When a government subsidy is monetary capital, it is measured at the received or receivable amount. None monetary capitalare measured at fair value; if no reliable fair value available, recognized at RMB1.
(3) Recognition of government subsidies
The company's government subsidies are calculated using the gross method.
Assets-related
Government subsidies related to assets are obtained by the Company to purchase, build or formulate in other mannerslong-term assets; or subsidies related to benefits. If the asset-related government subsidy is recognized as deferred gain, should berecorded in gain and loss in the service life. Government subsidy measured at the nominal amount is accounted into current incomeaccount. If the relevant assets are sold, transferred, scrapped or damaged before the end of their useful life, the unallocated relevantdeferred income balance shall be transferred to the profit and loss of the current period of disposition of the assets.
Gain-related government subsidy should be accounted as follows:
The Company divides government subsidies into assets-related and earnings-related government subsidies. Gain-relatedgovernment subsidy should be accounted as follows:
(1) Subsidy that will be used to compensate related future costs or losses should be recognized as deferred gain and recordedin the gain and loss of the current report and offset related cost;
(2) Subsidy that is used to compensate existing cost or loss should be recorded in the gain and loss of the current period oroffset related cost.
For government subsidies that include both asset-related and income-related parts, separate different parts for accountingtreatment; It is difficult to distinguish between the overall classification of government subsidies related to benefits.
Government subsidy related to routine operations should be recorded in other gains or offset related cost. Government subsidynot related to routine operations should be recorded in non-operating income or expense.
③ Policy preferential loan discount
The policy-based preferential loan obtained has interest subsidy. If the government allocates the interest-subsidy funds to thelending bank, the loan amount actually received will be used as the entry value of the loan, and the borrowing cost will be calculatedbased on the loan principal and policy-based preferential interest rate.
If the government allocates the interest-bearing funds directly to the Group, discount interest will offset the borrowing costs.
(2) Government subsidy refund
When a confirmed government subsidy needs to be returned, the book value of the asset is adjusted against the book value ofthe relevant asset at initial recognition. If there is a related deferred income balance, the book balance of the related deferred incomeis written off and the excess is credited to the current profit or loss; In other cases, it is directly included in the current profit and loss.
30. Differed income tax assets and differed income tax liabilities
The Company uses the temporary difference between the book value of the assets and liabilities on the balance sheet day andthe tax base and the liabilities method to recognize the deferred income tax. 26. Deferred income tax assets and deferred income tax
liabilities
(1) Deferred income tax assets
For deductible temporary discrepancies, deductible losses and tax offsets that can be carried forward for future years, theimpact on income tax is calculated at the estimated income tax rate for the transfer-back period and the impact is recognized asdeferred income tax assets, provided that the Company is likely to obtain future taxable income for deductible temporarydiscrepancies, deductible losses and tax offsets.At the same time, the impact on income tax of deductible temporary discrepancies resulting from the initial recognition ofassets or liabilities in transactions or matters with the following characteristics is inconclusive as deferred income tax assets:
A. The transaction is not a business combination;
B. the transaction is not a merger and the transaction does not affect the accounting profit or taxable proceeds;
In the event of temporary discrepancy of deductible investment related to subsidiaries, joint ventures and joint ventures, andmeeting the following two conditions, the amount of impact (talent) on income tax shall be deemed as deferred income tax assets:
A. Temporary discrepancies are likely to be reversed in the foreseeable future;
B. In the future, it is likely to obtain taxable income that can be used to offset the deductible temporary differences;
On the balance sheet date, if there is conclusive evidence that sufficient taxable income is likely to be obtained in the future tooffset the deductible temporary differences, the deferred income tax assets that have not been recognized in the previous period arerecognized.
On the balance sheet day, the Company re-examines the book value of the deferred income tax assets. If it is unlikely to haveadequate taxable proceeds to reduce the benefits of the deferred income tax assets, less the deferred income tax assets’ book value.When there is adequate taxable proceeds, the lessened amount will be reversed.
(2) Deferred income tax assets
All provisional differences in taxable income of the Company shall be measured on the basis of the estimated income tax ratefor the period of transfer-back and shall be recognized as deferred income tax liabilities, except that:
At the same time, the impact on income tax of deductible temporary discrepancies resulting the initial recognition of assets orliabilities in transactions or matters with the following characteristics is inconclusive as deferred income tax Liabilities:
A. Initial recognition of goodwill;
B. Initial recognition of goodwill, or of assets or liabilities generated in transactions with the following features: thetransaction is not a merger and the transaction does not affect the accounting profit or taxable proceeds;
② In the event of temporary discrepancy of deductible investment related to subsidiaries, Joint venture joint ventures, andmeeting the two conditions, the amount of impact (talent) on income tax shall be deemed as deferred income tax assets:
A. The Company is able to control the time of temporary discrepancy transfers;
B Temporary discrepancies are likely to be reversed in the foreseeable future;
(3) Deferred income tax assets
(1) Deferred income tax liabilities or assets associated with enterprise consolidation
Temporary difference of taxable tax or deductible temporary difference generated by enterprise merger under non-samecontrol. When deferred income tax liability or deferred income tax asset is recognized, related deferred income tax expense (or
income) is usually adjusted as recognized goodwill in enterprise merger.
② Amount of shares paid and accounted as owners' equity
Except for the adjustment goodwill generated by mergers or deferred income tax related to transactions or events directlyaccounted into the owners’ equity, income tax is accounted as income tax expense into the current gain/loss account. The effects oftemporary discrepancy on income tax include the following: Other integrated benefits such as fair value change of financial assetsavailable for sale, retroactive adjustment of accounting policy changes or retroactive restatement of accounting error correctiondiscrepancy to adjust the initial retained income, and mixed financial instruments including liabilities and equity.
③ Compensation for losses and tax deductions
A. Compensable losses and tax deductions from the company's own operations
Deductible losses refer to the losses calculated and determined in accordance with the provisions of the tax law that areallowed to be made up with the taxable income of subsequent years. The uncovered losses (deductible losses) and tax deductions thatcan be carried forward in accordance with the tax law are treated as deductible temporary differences. When it is expected thatsufficient taxable income is likely to be obtained in the future period when it is expected to be available to make up for losses or taxdeductions, the corresponding deferred income tax assets are recognized within the limit of the taxable income that is likely to beobtained, while reducing the current period Income tax expense in the income statement.
B. Compensable uncovered losses of the merged company due to business merger
In a business combination, if the company obtains the deductible temporary difference of the purchased party and does notmeet the deferred income tax asset recognition conditions on the purchase date, it shall not be recognized. Within 12 months after thepurchase date, if new or further information is obtained indicating that the relevant conditions on the purchase date already exist, andthe economic benefits brought about by the temporary difference are expected to be deducted on the purchase date, confirm therelevant delivery. Deferred income tax assets, while reducing goodwill, if the goodwill is not enough to offset, the difference isrecognized as the current profit and loss; except for the above circumstances, the deferred tax assets related to the businesscombination are recognized and included in the current profit and loss.
④Temporary difference caused by merger offset
If there is a temporary difference between the book value of assets and liabilities in the consolidated balance sheet and thetaxable basis of the taxpayer due to the offset of the unrealized internal sales gain or loss, the deferred income tax asset or thedeferred income tax liability is confirmed in the consolidated balance sheet, and the income tax expense in the consolidated profitstatement is adjusted, with the exception of the deferred income tax related to the transaction or event directly included in the owner'sequity and the merger of the enterprise.
⑤ Share payment settled by equity
If the tax law provides for allowable pre-tax deduction of expenses related to share payment, within the period for which thecost and expense are recognized in accordance with the accounting standards, the Company shall calculate the tax basis andtemporary discrepancy based on the estimated pre-tax deduction amount at the end of the accounting period and confirm the relevantdeferred income tax if it meets the conditions for confirmation. Of these, the amount that can be deducted before tax in the futureexceeds the cost related to share payment recognized in accordance with the accounting standards, and the excess income tax shall bedirectly included in the owner's equity.
31. Leasing
(1) Accounting of operational leasing
① The Company as the leasor: Rentals from operational leasing are recognized as current gains on straight basis to theperiods of leasing. Where the lessor provides a lease-free period, the total rent shall be apportioned within the whole lease-free periodwithout deducting the lease-free period according to the straight line method or other reasonable method, and the rent-free periodshall be recognized as well as the corresponding liabilities. People If the charterer undertakes certain expenses, the Company shalldistribute the rent Expense balance deducted from the total rent income during the lease term.Initial direct expenses are recorded to current income account. In the event of an agreement or rent, the current profit and lossshall be included in the actual occurrence.
② When the Company is the operating lessor, the rent received shall be recognized as income within the lease term by thestraight line method. Where the lessor provides a lease-free period, the total rent shall be apportioned within the whole lease-freeperiod without deducting the lease-free period according to the straight line method or other reasonable method, and the rent-freeperiod shall be recognized as well as the corresponding liabilities. If the charterer undertakes certain expenses, the Company shalldistribute the rent income balance deducted from the total rent income during the lease term.Initial direct expenses are recorded to current income account. Larger amounts shall be capitalized and included in current profits andlosses in installments on the same basis as the confirmed rental income during the entire operating lease period. In the event of anagreement or rent, the current profit and loss shall be included in the actual occurrence.
(2) Accounting of operational leasing
Inapplicable
32. Other significant accounting policies and estimates
(1) Measurement at fair value
Fair value is the price that can be obtained from selling an asset or paid for transferring liabilities in an orderly transaction onthe measurement date.
The company measures the fair value of related assets or liabilities at the prices in the main market. If there is no major market,the company measures the fair value of the relevant assets or liabilities at the most favorable market prices. The Group usesassumptions that market participants use to maximize their economic benefits when pricing the asset or liability.
The main market refers to the market with the highest transaction volume and activity of the related assets or liabilities. Themost favorable market means the market that can sell the related assets at the highest amount or transfer the related liabilities at thelowest amount after considering the transaction cost and transportation cost.
For financial assets or liabilities in an active market, The Company determines their fair value based on quotations in theactive market. If there is no active market, the Company uses evaluation techniques to determine the fair value.
For the measurement of non-financial assets at fair value, the ability of market participants to use the assets for optimalpurposes to generate economic benefits, or the ability to sell the assets to other market participants that can be used for optimalpurposes to generate economic benefits.
① Valuation technology
The company adopts valuation techniques that are applicable in the current period and are supported by sufficient data andother information. The valuation techniques used mainly include market method, income method and cost method. The companyuses a method consistent with one or more of the valuation techniques to measure fair value. If multiple valuation techniques are usedto measure fair value, the reasonableness of each valuation result shall be considered, and the fair value shall be selected as the mostrepresentative of fair value under the current circumstances. The amount of value is regarded as fair value.
The The Company equipment are applicable in the current circumstances and have sufficient available data and otherinformation to support the use of the relevant observable input values prioritized. Unobservable input values are used only when theobservable input value cannot be obtained or is not feasible. Observable input values are input values that can be obtained frommarket data. The Group uses assumptions that market participants use to maximize their economic benefits when pricing the asset orliability. Non-observable input values are input values that cannot be obtained from market data. The input value is obtained based onthe best information available on assumptions used by market participants in pricing the relevant asset or liability.
②Fair value hierarchy
This company divides the input value used in fair value measurement into three levels, and first uses the first level input value,then uses the second level input value, and finally uses the third level input value. First level: quotation of same assets or liabilities inan active market (unadjusted) The second level input value is a directly or indirectly observable input value of the asset or liability inaddition to the first level input value. The input value of the third level is the unobservable input value of the related asset or liability.
(2) Hedge accounting
(1) Classification of inventories
The company's hedge is a cash flow hedge.
Cash flow hedging refers to the hedging of cash flow risk. The change in cash flow is derived from specific risks associatedwith recognized assets or liabilities, expected transactions that are likely to occur, or with respect to the components of theabove-mentioned project and will affect the profits and losses of the enterprise.
(2) Hedging tools and hedged projects
Hedging means a financial instrument designated by the Company for the purpose of hedging, whose fair value or cash flowvariation is expected to offset the fair value or cash flow variation of the hedged item, including:
① Financial liabilities measured at fair value with variations accounted into current income account Check-out options canonly be used as a hedging tool if the option is hedged, including those embedded in a hybrid contract. Derivatives embedded in ahybrid contract but not split cannot be used as separate hedging tools.
② Non-derivative financial assets or non-derivative financial liabilities that are measured at fair value and whose changes areincluded in the current profit and loss, but designated as fair value and whose changes are included in the current profit and loss, andtheir own credit risk changes caused by changes in fair value except for financial liabilities included in other comprehensive income.
Own equity instruments are not financial assets or financial liabilities and cannot be used as hedging instruments.
A hedged item refers to an item that exposes the company to the risk of changes in fair value or cash flow and is designated asthe hedged object and can be reliably measured. The company designates the following individual projects, project portfolios or theircomponents as hedged projects:
① Confirmed assets or liabilities.
② Confirmed commitments that have not yet been confirmed. Confirmed commitment refers to a legally binding agreementto exchange a specific amount of resources at an agreed price on a specific date or period in the future.
③ Expected transactions that are likely to occur. Anticipated transactions refer to transactions that have not yet beencommitted but are expected to occur.
④ Net investment in overseas operations.
The above-mentioned project components refer to the parts that are less than the overall fair value or cash flow changes of theproject. The company designates the following project components or their combinations as hedged items:
① The part of the change in fair value or cash flow (risk component) that is only caused by one or more specific risks in theoverall fair value or cash flow changes of the project. According to the assessment in a specific market environment, the riskcomponent should be able to be individually identified and reliably measured. The risk component also includes the part where thefair value or cash flow of the hedged item changes only above or below a specific price or other variables.
② One or more selected contractual cash flows.
③ The component of the nominal amount of the project, that is, the specific part of the whole amount or quantity of theproject, may be a certain proportion of the whole project, or may be a certain level of the whole project. If a certain level includesearly repayment rights and the fair value of the early repayment rights is affected by changes in the risk of the hedge, the level shallnot be designated as the hedged item of the fair value hedge, but in the measurement of the hedged item except when the fair valuehas included the influence of the prepayment right.
(3) Evaluation of hedging relationship
When the hedging relationship is initially specified, the Group officially specifies the related hedging relationships withofficial documents recording the hedging relationships, risk management targets and hedging strategies. This document sets out thehedging tools, hedged items, the nature of hedged risks, and the company's assessment of hedged effectiveness. Hedging means afinancial instrument designated by the Company for the purpose of hedging, whose fair value or cash flow variation is offset the fairvalue or cash flow variation of the hedged item, including: Such hedges are continuously evaluated on and after the initial specifieddate to meet the requirements for hedging validity.
If the hedging instrument has expired, been sold, the contract is terminated or exercised (but the extension or replacement aspart of the hedging strategy is not treated as expired or contract termination), or the risk management objective changes, resulting inhedging The relationship no longer meets the risk management objectives, or the economic relationship between the hedged item andthe hedging instrument no longer exists, or the impact of credit risk begins to dominate in the value changes caused by the economicrelationship between the hedged item and the hedging instrument, or when the hedge no longer meets the other conditions of thehedge accounting method, the company terminates the use of hedge accounting.
If the hedging relationship no longer meets the requirements for hedging effectiveness due to the hedging ratio, but the riskmanagement objective of the designated hedging relationship has not changed, the company shall rebalance the hedging relationship.
(4) Revenue the of revenue recognition and measurement
If the strict conditions of the hedging accounting method are satisfied, the following methods shall be applied:
Cash flow hedging
The part of hedging tool gains or losses that is valid for hedging is recognized as other comprehensive income as a cash flowhedging reserve, and the part that is invalid for hedging (that is, other gains or losses after deducting other comprehensive income),are counted Into the current profit and loss. The amount of cash flow hedging reserve is determined according to the lower of theabsolute amounts of the following two items: ①accumulated gains or losses of hedging instruments since the hedging. The amountin the effective arbitrage is recognized by the accumulative gains or losses from the starting of arbitrage and accumulative changes tothe current value of future forecast cash flows from the start of arbitrage.
If the expected transaction of the hedged asset is subsequently recognized as a non-financial asset or non-financial liability, orif the expected transaction of the non-financial asset or non-financial liability forms a defined commitment to the applicable fairvalue hedge accounting, the amount of the cash flow hedge reserve originally recognized in the other consolidated income istransferred out to account for the initial recognized amount of the asset or liability. For the remaining cash flow hedges, during thesame period when the expected cash flow to be hedged affects the profit and loss, if the expected sales occur, the cash flow hedgereserve recognized in other comprehensive income is transferred out and included in the current profit and loss.
(3) Repurchase of the Company’s shares
(1) In the event of a reduction in the Company's share capital as approved by legal procedure, the Company shall reduce theshare capital by the total amount of the written-off shares, adjust the owner's equity by the difference between the price paid by thepurchased stocks (including transaction costs) and the total amount of the written-off shares, offset the capital reserve (share capitalpremium), surplus reserve and undistributed profits in turn; A portion of a capital reserve (share capital premium) that is less than thetotal face value and less than the total face value.
(2) The total expenditure of the repurchase shares of the company, which is managed as an inventory share before they arecancelled or transferred, is converted to the cost of the inventory shares.
(3) Increase in the capital reserve (capital premium) at the time of transfer of an inventory unit, the portion of the transferincome above the cost of the inventory unit; Lower than the inventory stock cost, the capital reserve (share capital premium), surplusreserve, undistributed profits in turn.
(4) Significant accounting judgment and estimate
The Company continuously reviews significant accounting judgment and estimate adopted for the reasonable forecast of futureevents based on its historical experience and other factors. Significant accounting judgment and assumptions that may lead to majoradjustment of the book value of assets and liabilities in the next accounting year are listed as follows:
Classification of financial assets
The major judgements involved in the classification of financial assets include the analysis of business model and contractcash flow characteristics.
The company determines the business mode of managing financial assets at the level of financial asset portfolio, taking intoaccount such factors as how to evaluate and report financial asset performance to key managers, the risks that affect financial assetperformance and how to manage it, and how to obtain remuneration for related business managers.
When the company assesses whether the contractual cash flow of financial assets is consistent with the basic borrowingarrangement, there are the following main judgments: whether the principal may change due to early repayment and other reasonsduring the duration of the period or the amount of change; whether the interest Including the time value of money, credit risk, otherbasic borrowing risks, and consideration of costs and profits. For example, does the amount paid in advance reflect only the unpaidprincipal and the interest based on the unpaid principal, as well as the reasonable compensation paid for early termination of thecontract.
Measurement of expected credit losses of accounts receivable
The Company calculates the expected credit loss of accounts receivable through the risk exposure of accounts receivabledefault and the expected credit loss rate, and determines the expected credit loss rate based on the default probability and the defaultloss rate. When determining the expected credit loss rate, the company uses internal historical credit loss experience and other data,combined with current conditions and forward-looking information to adjust the historical data. When considering forward-lookinginformation, the indicators used by the company include the risks of economic downturn, changes in the external market environment,technological environment, and customer conditions. The company regularly monitors and reviews assumptions related to the
calculation of expected credit losses.Deferred income tax assetsIf there is adequate taxable profit to deduct the loss, the deferred income tax assets should be recognized by all the unused taxloss. This requires the management to make a lot of judgment to forecast the time and amount of future taxable profit and determinethe amount of the deferred tax assets based on the taxation strategy.Construction contractsThe Group recognizes income based on the completion of individual construction contract. The management determines thecompletion percentage based on the actual cost in the total budget and forecasts the contract income. The starting and completiondates of construction contracts fall in different account periods. The Group will review and adjust contract income and costestimation in budgets (if the actual contract income is less than the estimate or actual contract cost, contract estimation loss provisionwill be made).
Estimate of fair valueThe Group uses fair value to measure investment real estate and needs to estimate the fair value of investment real estate atleast quarterly. This requires the management to reasonably estimate the fair value of the investment real estate with the help ofvaluation experts.Development costFor property that has been handed over with income recognized, but whose public facilities have not been constructed or notbeen completed, the management will estimate the development cost for the part that has not been started according to the budget toreflect the operation result of the property sales.
33. Major changes in accounting policies and estimates
(1) Changes in accounting policies
√ Applicable □ Inapplicable
| Account policy changes and reasons | Approval procedure | Remark |
| According to the relevant regulations of the Ministry of Finance, the new revenue standard will be implemented from January 1, 2020 | This change in accounting policies was reviewed and approved at the 22nd meeting of the 8th Board of Directors held on April 16, 2020. |
As of January 1, 2020, the Company has implemented new revenue guidelines, listed the assigned goods or services entitled toreceive consideration as contractual assets, and has been recognized as accounts receivable upon acquisition of unconditionalcollection rights; The non-leased portion of the advances is included in the contractual liability and the tax portion is included in theother current liabilities.According to the regulations of the convergence between the old and new standards, the company adjusts the amount ofretained earnings at the beginning of the period and other related items in the financial statements based on the cumulative impact ofthe first implementation of the new income standard, and does not adjust the information for the comparable period.For details of the impact of this change in accounting policies on the statement items, see "(3) The first implementation of thenew income standards and adjustments to the new lease standards from 2020 on the first implementation of the financial statementsrelated items at the beginning of the year" under this item.
(2) Changes in major accounting estimates
√ Applicable □ Inapplicable
| Account policy changes and reasons | Approval procedure | Effective time | Remarks |
| In accordance with the requirements of the new financial instrument standards, enterprises should assess whether the credit risk of relevant financial instruments has changed significantly on each balance sheet date. The company uses the latest historical data to calculate the expected credit loss in 2020 according to the method of calculating expected credit losses in 2019, which has changed significantly from 2019. In order to more objectively and truly reflect the financial status and operating results of the company’s various businesses, Specially make changes in accounting estimates of accounts receivable and expected credit loss rate of contract assets. | This change in accounting estimates was reviewed and approved at the 22nd meeting of the 8th Board of Directors held on April 16, 2020. | January 1, 2020 |
The impact of this change in accounting estimates on the 2020 semi-annual financial statement items is: increase accounts receivableby 15,632,429.65 yuan, increase contract assets by 79,360,828.79 yuan, reduce deferred income tax assets by 14,253,692.64 yuan,and increase credit impairment losses (losses are marked with "-" No.) 94,993,258.44 yuan, increase deferred income tax expense by14,253,692.64 yuan, increase net profit by 80,739,565.80 yuan.
(3) The first implementation of the new financial instruments guidelines, new income standards, new leasestandards, adjustments the first implementation of the financial statements at the beginning of the year
ApplicableWhether to adjust the balance sheet accounts at the beginning of the year
√ Yes □ No
Consolidated Balance Sheet
In RMB
| Item | 31 December 2019 | 1 January 2020 | Adjustment |
| Current asset: | |||
| Monetary capital | 1,209,811,978.95 | 1,209,811,978.95 | |
| Settlement provision | |||
| Outgoing call loan | |||
| Transactional financial assets | 10,330,062.18 | 10,330,062.18 | |
| Derivative financial assets | |||
| Notes receivable | 305,070,930.97 | 305,070,930.97 | |
| Account receivable | 1,956,191,307.07 | 486,113,221.52 | -1,470,078,085.55 |
| Receivable financing | 2,954,029.00 | 2,954,029.00 | |
| Prepayment | 21,327,109.18 | 21,327,109.18 |
| Insurance receivable | |||
| Reinsurance receivable | |||
| Provisions of Reinsurance contracts receivable | |||
| Other receivables | 139,947,655.35 | 139,947,655.35 | |
| Including: interest receivable | |||
| Dividend receivable | |||
| Repurchasing of financial assets | |||
| Inventory | 733,711,143.46 | 733,711,143.46 | |
| Contract assets | 1,470,078,085.55 | 1,470,078,085.55 | |
| Assets held for sales | |||
| Non-current assets due in 1 year | |||
| Other current assets | 323,765,585.90 | 323,765,585.90 | |
| Total current assets | 4,703,109,802.06 | 4,703,109,802.06 | |
| Non-current assets: | |||
| Loan and advancement provided | |||
| Debt investment | |||
| Other debt investment | |||
| Long-term receivables | |||
| Long-term share equity investment | 57,222,240.83 | 57,222,240.83 | |
| Investment in other equity tools | 20,660,181.44 | 20,660,181.44 | |
| Other non-current financial assets | 5,009,728.02 | 5,009,728.02 | |
| Investment real estate | 5,522,391,984.11 | 5,522,391,984.11 | |
| Fixed assets | 477,332,830.92 | 477,332,830.92 | |
| Construction in process | 129,988,982.86 | 129,988,982.86 | |
| Productive biological assets | |||
| Gas & petrol |
| Use right assets | |||
| Intangible assets | 78,322,265.05 | 78,322,265.05 | |
| R&D expense | |||
| Goodwill | |||
| Long-term amortizable expenses | 3,875,198.12 | 3,875,198.12 | |
| Deferred income tax assets | 343,349,564.70 | 343,349,564.70 | |
| Other non-current assets | 28,701,802.00 | 28,701,802.00 | |
| Total of non-current assets | 6,666,854,778.05 | 6,666,854,778.05 | |
| Total of assets | 11,369,964,580.11 | 11,369,964,580.11 | |
| Current liabilities | |||
| Short-term loans | 724,618,197.34 | 724,618,197.34 | |
| Loans from Central Bank | |||
| Call loan received | |||
| Transactional financial liabilities | |||
| Derivative financial liabilities | 96,767.62 | 96,767.62 | |
| Notes payable | 578,816,027.44 | 578,816,027.44 | |
| Account payable | 1,190,773,300.24 | 1,190,773,300.24 | |
| Prepayment received | 136,340,104.73 | 1,332,457.45 | -135,007,647.28 |
| Contract liabilities | 123,981,276.51 | 123,981,276.51 | |
| Selling of repurchased financial assets | |||
| Deposit received and held for others | |||
| Entrusted trading of securities | |||
| Entrusted selling of securities | |||
| Employees' wage payable | 55,847,134.20 | 55,847,134.20 | |
| Taxes payable | 17,848,987.68 | 17,848,987.68 | |
| Other payables | 701,432,408.28 | 701,432,408.28 |
| Including: interest payable | |||
| Dividend payable | |||
| Fees and commissions payable | |||
| Reinsurance fee payable | |||
| Liabilities held for sales | |||
| Non-current liabilities due in 1 year | 922,346,563.72 | 922,346,563.72 | |
| Other current liabilities | 181,694,574.47 | 192,720,945.24 | 11,026,370.77 |
| Total current liabilities | 4,509,814,065.72 | 4,509,814,065.72 | |
| Non-current liabilities: | |||
| Insurance contract provision | |||
| Long-term loans | 546,501,491.56 | 546,501,491.56 | |
| Bond payable | |||
| Including: preferred stock | |||
| Perpetual bond | |||
| Lease liabilities | |||
| Long-term payable | |||
| Long-term employees’ wage payable | |||
| Anticipated liabilities | 7,793,527.16 | 7,793,527.16 | |
| Deferred earning | 10,817,247.40 | 10,817,247.40 | |
| Deferred income tax liabilities | 1,063,833,159.00 | 1,063,833,159.00 | |
| Other non-current liabilities | |||
| Total of non-current liabilities | 1,628,945,425.12 | 1,628,945,425.12 | |
| Total liabilities | 6,138,759,490.84 | 6,138,759,490.84 | |
| Owner’s equity: | |||
| Share capital | 1,123,384,189.00 | 1,123,384,189.00 | |
| Other equity instruments |
| Including: preferred stock | |||
| Perpetual bond | |||
| Capital reserves | 1,454,191.59 | 1,454,191.59 | |
| Less: Shares in stock | |||
| Other miscellaneous income | -475,409.25 | -475,409.25 | |
| Special reserves | |||
| Surplus reserve | 159,805,930.34 | 159,805,930.34 | |
| Common risk provisions | |||
| Undistributed profit | 3,898,626,177.99 | 3,898,626,177.99 | |
| Total of owner’s equity belong to the parent company | 5,182,795,079.67 | 5,182,795,079.67 | |
| Minor shareholders’ equity | 48,410,009.60 | 48,410,009.60 | |
| Total of owners’ equity | 5,231,205,089.27 | 5,231,205,089.27 | |
| Total of liabilities and owner’s interest | 11,369,964,580.11 | 11,369,964,580.11 |
Balance Sheet of the Parent Company
In RMB
| Item | 31 December 2019 | 1 January 2020 | Adjustment |
| Current asset: | |||
| Monetary capital | 175,591,953.63 | 175,591,953.63 | |
| Transactional financial assets | |||
| Derivative financial assets | |||
| Notes receivable | |||
| Account receivable | 297,813.76 | 297,813.76 | |
| Receivable financing | |||
| Prepayment | 250,205.32 | 250,205.32 | |
| Other receivables | 1,973,381,342.74 | 1,973,381,342.74 | |
| Including: interest receivable |
| Dividend receivable | |||
| Inventory | |||
| Contract assets | |||
| Assets held for sales | |||
| Non-current assets due in 1 year | |||
| Other current assets | 877,430.41 | 877,430.41 | |
| Total current assets | 2,150,398,745.86 | 2,150,398,745.86 | |
| Non-current assets: | |||
| Debt investment | |||
| Other debt investment | |||
| Long-term receivables | |||
| Long-term share equity investment | 963,508,253.00 | 963,508,253.00 | |
| Investment in other equity tools | 18,604,010.22 | 18,604,010.22 | |
| Other non-current financial assets | 48,831,242.35 | 48,831,242.35 | |
| Investment real estate | 295,355,002.00 | 295,355,002.00 | |
| Fixed assets | 67,361,529.52 | 67,361,529.52 | |
| Construction in process | |||
| Productive biological assets | |||
| Gas & petrol | |||
| Use right assets | |||
| Intangible assets | 1,824,589.22 | 1,824,589.22 | |
| R&D expense | |||
| Goodwill | |||
| Long-term amortizable expenses | 934,669.73 | 934,669.73 | |
| Deferred income tax assets | 44,408,630.81 | 44,408,630.81 | |
| Other non-current assets | |||
| Total of non-current assets | 1,440,827,926.85 | 1,440,827,926.85 | |
| Total of assets | 3,591,226,672.71 | 3,591,226,672.71 |
| Current liabilities | |||
| Short-term loans | 300,442,988.19 | 300,442,988.19 | |
| Transactional financial liabilities | |||
| Derivative financial liabilities | |||
| Notes payable | |||
| Account payable | 606,941.85 | 606,941.85 | |
| Prepayment received | 746,761.55 | 746,761.55 | |
| Contract liabilities | |||
| Employees' wage payable | 3,215,013.16 | 3,215,013.16 | |
| Taxes payable | 312,647.89 | 312,647.89 | |
| Other payables | 109,837,934.17 | 109,837,934.17 | |
| Including: interest payable | |||
| Dividend payable | |||
| Liabilities held for sales | |||
| Non-current liabilities due in 1 year | 520,872,206.95 | 520,872,206.95 | |
| Other current liabilities | |||
| Total current liabilities | 936,034,493.76 | 936,034,493.76 | |
| Non-current liabilities: | |||
| Long-term loans | 70,000,000.00 | 70,000,000.00 | |
| Bond payable | |||
| Including: preferred stock | |||
| Perpetual bond | |||
| Lease liabilities | |||
| Long-term payable | |||
| Long-term employees’ wage payable | |||
| Anticipated liabilities | |||
| Deferred earning |
| Deferred income tax liabilities | 64,351,075.92 | 64,351,075.92 | |
| Other non-current liabilities | |||
| Total of non-current liabilities | 134,351,075.92 | 134,351,075.92 | |
| Total liabilities | 1,070,385,569.68 | 1,070,385,569.68 | |
| Owner’s equity: | |||
| Share capital | 1,123,384,189.00 | 1,123,384,189.00 | |
| Other equity instruments | |||
| Including: preferred stock | |||
| Perpetual bond | |||
| Capital reserves | 360,835.52 | 360,835.52 | |
| Less: Shares in stock | |||
| Other miscellaneous income | 1,287,629.38 | 1,287,629.38 | |
| Special reserves | |||
| Surplus reserve | 159,805,930.34 | 159,805,930.34 | |
| Undistributed profit | 1,236,002,518.79 | 1,236,002,518.79 | |
| Total of owners’ equity | 2,520,841,103.03 | 2,520,841,103.03 | |
| Total of liabilities and owner’s interest | 3,591,226,672.71 | 3,591,226,672.71 |
About the adjustmentAs of January 1, 2020, the Company has implemented new revenue guidelines, listed the assigned goods or services entitled toreceive consideration as contractual assets, and has been recognized as accounts receivable upon acquisition of unconditionalcollection rights; The non-leased portion of the advances is included in the contractual liability and the tax portion is included in theother current liabilities.
(4) Description of the 2020 first implementation of the new Income criteria, new lease standardretrospective adjustment of the previous period comparison data
□ Applicable √ Inapplicable
VI. Taxation
1. Major taxes and tax rates
| Tax | Tax basis | Tax rate |
| VAT | Taxable income | 3%, 5%, 6%, 9%, 13% |
| City maintenance and construction tax | Taxable turnover | 1%, 5%, 7% |
| Enterprise income tax | Taxable income | See the following table |
| Education surtax | Taxable turnover | 3% |
| Local education surtax | Taxable turnover | 2% |
Tax rates applicable for different tax payers
| Tax payer | Income tax rate |
| The Company | 25% |
| Shenzhen Fangda Jianke Co., Ltd. (hereinafter Fangda Jianke) | 15% (for details see 6 2 (1)) |
| Fangda Zhichuang Technology Co., Ltd, (Fangda Zhichuang) | 15% (for details see 6 2 (2)) |
| Fangda New Material (Jiangxi) Co., Ltd. (hereinafter Fangda New Material) | 15% (for details see 6 2 (3)) |
| Dongguan Fangda New Material Co., Ltd. (hereinafter Dongguan New Material) | 15% (for details see 6 2 (4)) |
| Chengdu Fangda Construction Technology Co., Ltd. (hereinafter Chengdu Fangda) | 15% (for details see 6 2 (5)) |
| Shenzhen Fangda Property Development Co., Ltd. (hereinafter Fangda Property Development) | 25% |
| Shenzhen Fangda New Energy Co., Ltd. (hereinafter Fangda New Energy) | 25% |
| Shenzhen Fangda Property Development Co., Ltd. (hereinafter Fangda Property Development) | 25% |
| Jiangxi Fangda Property Development Co., Ltd. (hereinafter Jiangxi Property Development) | 25% |
| Pingxiang Fangda Luxin New Energy Co., Ltd. (hereinafter Luxin New Energy) | 25% (for details see 6 2 (6)) |
| Nanchang Xinjian Fangda New Energy Co., Ltd. (hereinafter Xinjian New Energy) | 25% (for details see 6 2 (7)) |
| Dongguan Fangda New Energy Co., Ltd. (hereinafter Dongguan New Energy) | 25% (for details see 6 2 (8)) |
| Shenzhen QIanhai Kechuangyuan Software Co., Lt.d (hereinafter Kechuangyuan Software) | 25% (for details see 6 2 (9)) |
| Fangda Zhichuang Technology (Hong Kong) Co., Ltd, | 16.50% |
| (Zhichuang Hong Kong) | |
| Shihui International Holding Co., Ltd. (hereinafter Shihui International) | 16.50% |
| Shenzhen Hongjun Investment Co., Ltd. | 25% |
| Fangda Australia Pty Ltd (hereinafter Jianke Australia) | 30% |
| Shanghai Fangda Jingling Technology Co., Ltd. (hereinafter Jingling Technology) | 25% |
| Shenzhen Fangda Cloud Rail Technology Co., Ltd. (hereinafter Fangda Cloud Rail) | 25% |
| Shanghai Fangda Jianzhi Technology Co., Ltd. (hereinafter Shanghai Fangda Jianzhi) | 25% |
| Shenzhen Zhongrong Litai Investment Co. Ltd. (Zhongrong Litai) | 25% |
| Chengdu Fangda Curtain Wall Technology Co., Ltd. (hereinafter Chengdu Curtain Wall) | 25% |
| Fangda Southeast Asia Co., Ltd. (hereinafter Fangda Southeast Asia) | 20% |
| Fangda Jianke (Hong Kong) Co., Ltd. (hereinafter Jianke Hong Kong) | 16.50% |
2. Tax preference
(1) According to the Certification of High-tech Enterprise issued by Shenzhen Commission of Technological Innovation,Shenzhen Commission of Finance, Shenzhen National Tax Bureau, and Shenzhen Local Tax Bureau on 19.06.15, Fangda Jianke wasentitled to enjoy a tax preference of enterprise income tax of 15% for three years (2018-2017) since the qualifications were awarded.
(2) According to the Certification of High-tech Enterprise issued by Shenzhen Commission of Technological Innovation,Shenzhen Commission of Finance, Shenzhen National Tax Bureau, and Shenzhen Local Tax Bureau on 19.06.15, Fangda Zhichuangwas entitled to enjoy a tax preference of enterprise income tax of 15% for three years (2018-2017) since the qualifications wereawarded.
(3) According to the Certification of High-tech Enterprise issued by Jiangxi Ministry of Science and Technology, JiangxiMinistry of Finance, Jiangxi National Tax Bureau, and Jiangxi Local Tax Bureau on 13.08.18, Fangda New Material was entitled toenjoy a tax preference of enterprise income tax of 15% for three years (2018-2014) since the qualifications were awarded.
(4) According to the Certification of High-tech Enterprise issued by Guangdong Ministry of Science and Technology,Guangdong Ministry of Finance, Guangdong National Tax Bureau, and Guangdong Local Tax Bureau on December 2, 2019,Dongguan New Material was entitled to enjoy a tax preference of enterprise income tax of 15% for three years (2019-2021) since thequalifications were awarded.
(5) On November 7, 2014, Chengdu Fangda was certified by Sichuan Xinjin National Tax Bureau as an encourage industrycompany in the west China (Xin Jin National Tax Doc. [zzy024]) and started to enjoy a tax rate of 15%.On Monday, December 04, 2017, the subsidiary Chengdu Fangda Construction Technology Co., Ltd. obtained the ―High-techEnterprise Certificate‖ jointly issued by Sichuan Science and Technology Department, Sichuan Provincial Department of Finance,Sichuan Provincial State Taxation Bureau and Sichuan Provincial Local Taxation Bureau, within three years after obtaining the
qualification of high-tech enterprises (2017 to 2019), the income tax is levied Resume at 15%.
(6) On 02.03.16, according to the document issued by Luxi National Tax Bureau, the PV power generation project undertakenby Pingxiang Fangda Luxin New Energy Co., Ltd, became the infrastructure project supported by the central government. Thecompany enjoys a three-year enterprise income tax relief and 50% reduction for another three years. In 2016, the company enteredthe exemption period.
(7) On 02.06.16, according to the document issued by Nanchang Xinjian District National Tax Bureau, the PV power generationproject undertaken by subsidiary Xinjian New Energy Company, became the infrastructure project supported by the centralgovernment. The company enjoys a three-year enterprise income tax relief and 50% reduction for another three years. In 2016, thecompany entered the exemption period.
(8) On November 2, 2015, Dongguan New Energy was certified by Dongguan National Tax Bureau Songshanhu branch as thenational supported public infrastructure project according to the Song Shan Hu Tax Doc [2015] 3305. The company is exemptedfrom enterprise income tax for three years and halfly exempted for another three years. In 2015, the company entered the exemptionperiod.
(9) On 10.03.17, according to the registration to Shenzhen National Tax Bureau, subsidiary Kechuangyuan Software became anewly established software and integrated circuit designing company and can enjoy the two-year full exemption and three-yearhalf-exemption of the enterprise income tax from the first year that the company records profit. Kexunda started making profits in2016 and therefore starts to enjoy the exemption.
VII. Notes to the consolidated financial statements
1. Monetary capital
In RMB
| Item | Closing balance | Opening balance |
| Inventory cash: | 9,534.72 | 4,244.86 |
| Bank deposits | 695,944,047.54 | 755,440,390.76 |
| Other monetary capital | 360,965,672.10 | 454,367,343.33 |
| Total | 1,056,919,254.36 | 1,209,811,978.95 |
| Including: total amount deposited in overseas | 35,541,487.15 | 54,640,438.33 |
| The total amount of money that has restrictions on use due to mortgage, pledge or freezing | 444,757,864.32 | 484,542,076.05 |
Other note
(1) Restricted funds in monetary funds are 444,757,864.32 yuan; among them, restricted funds used in bank deposits are91,330,153.91 yuan, which are labor insurance accounts, migrant workers' deposits, and litigation frozen funds, etc.; restricted fundsin other monetary funds are 353,427,710.41 yuan, mainly for draft deposits, interim guarantee deposits, guarantee deposits forissuance of letters of guarantee, etc. In addition, there are no other funds in the monetary funds at the end of the period that haverestrictions on use and potential recovery risks due to mortgages, pledges or freezing.
② In the preparation of the cash flow statement, the above-mentioned deposits and other restricted deposits are not used as cashand cash equivalents.
(3) At the end of the period, the total amount of funds deposited overseas by the Group was RMB 35,541,487.15, of which norepatriation was restricted.
2. Transactional financial assets
In RMB
| Item | Closing balance | Opening balance |
| Financial assets measured at fair value with variations accounted into current income account | 18,005,336.72 | 10,330,062.18 |
| Including: Investment of financial products | 18,005,336.72 | 10,330,062.18 |
| Total | 18,005,336.72 | 10,330,062.18 |
3. Derivative financial assets
In RMB
| Item | Closing balance | Opening balance |
| Futures hedging contract | 1,760,150.00 | |
| Forward foreign exchange contract | 55,526.34 | |
| Total | 1,815,676.34 |
4. Notes receivable
(1) Classification of notes receivable
In RMB
| Item | Closing balance | Opening balance |
| Bank acceptance | 6,450,000.00 | 45,540,691.10 |
| Commercial acceptance | 158,076,921.14 | 259,530,239.87 |
| Total | 164,526,921.14 | 305,070,930.97 |
If the provision for bad debts of bills receivable is made in accordance with the general model of expected credit losses, please referto the disclosure of other receivables to disclose information about bad debts:
□ Applicable √ Inapplicable
(2) The Group has no endorsed or discounted immature receivable notes at the end of the period.
In RMB
| Item | De-recognized amount | Not de-recognized amount |
| Bank acceptance | 12,540,000.00 | 4,650,000.00 |
| Commercial acceptance | 32,157,182.46 | |
| Total | 12,540,000.00 | 36,807,182.46 |
5. Account receivable
(1) Account receivable disclosed by categories
In RMB
| Type | Closing balance | Opening balance | ||||||||
| Remaining book value | Bad debt provision | Book value | Remaining book value | Bad debt provision | Book value | |||||
| Amount | Proportion | Amount | Provision rate | Amount | Proportion | Amount | Provision rate | |||
| Account receivable for which bad debt provision is made by group | 97,737,898.97 | 13.22% | 97,737,898.97 | 100.00% | 0.00 | 97,344,440.13 | 14.19% | 97,344,440.13 | 100.00% | 0.00 |
| Including: | ||||||||||
| 1. Customer 1 | 55,266,682.05 | 7.47% | 55,266,682.05 | 100.00% | 0.00 | 54,873,223.21 | 8.00% | 54,873,223.21 | 100.00% | 0.00 |
| 2. Customer 2 | 21,739,381.96 | 2.94% | 21,739,381.96 | 100.00% | 0.00 | 21,739,381.96 | 3.17% | 21,739,381.96 | 100.00% | 0.00 |
| 3. Customer 3 | 13,461,834.96 | 1.82% | 13,461,834.96 | 100.00% | 0.00 | 13,461,834.96 | 1.96% | 13,461,834.96 | 100.00% | 0.00 |
| 4. Customer 4 | 7,270,000.00 | 0.98% | 7,270,000.00 | 100.00% | 0.00 | 7,270,000.00 | 1.06% | 7,270,000.00 | 100.00% | 0.00 |
| Account receivable for which bad debt provision is made by group | 641,663,604.40 | 86.78% | 77,245,585.81 | 12.04% | 564,418,018.59 | 588,639,329.05 | 85.81% | 102,526,107.53 | 17.42% | 486,113,221.52 |
| Including: | ||||||||||
| Portfolio 1: Engineering operations section | 324,936,566.69 | 43.95% | 49,004,572.37 | 15.08% | 275,931,994.32 | 440,597,127.89 | 64.23% | 91,306,215.77 | 20.72% | 349,290,912.12 |
| Portfolio 2: Real estate business payments | 236,737,347.31 | 32.02% | 25,876,801.02 | 10.93% | 210,860,546.29 | 78,982,274.43 | 11.51% | 8,857,718.82 | 11.21% | 70,124,555.61 |
| Combination 3: Other business models | 79,989,690.40 | 10.82% | 2,364,212.42 | 2.96% | 77,625,477.98 | 69,059,926.73 | 10.07% | 2,362,172.94 | 3.42% | 66,697,753.79 |
| Total | 739,401,503.37 | 100.00% | 174,983,484.78 | 11.54% | 564,418,018.59 | 685,983,769.18 | 100.00% | 199,870,547.66 | 29.14% | 486,113,221.52 |
Separate bad debt provision:
In RMB
| Name | Closing balance | |||
| Remaining book value | Bad debt provision | Provision rate | Reason | |
| Customer 1 | 55,266,682.05 | 55,266,682.05 | 100.00% | Customer credit status deteriorates and is not expected to be recovered |
| Customer 2 | 21,739,381.96 | 21,739,381.96 | 100.00% | Customer credit status deteriorates and is not expected to be recovered |
| Customer 3 | 13,461,834.96 | 13,461,834.96 | 100.00% | Customer credit status deteriorates and is not expected to be recovered |
| Customer 4 | 7,270,000.00 | 7,270,000.00 | 100.00% | Customer credit status deteriorates and is not expected to be recovered |
| Total | 97,737,898.97 | 97,737,898.97 | -- | -- |
Provision for bad debts by combination:
In RMB
| Name | Closing balance | ||
| Remaining book value | Bad debt provision | Provision rate | |
| Portfolio 1: Engineering operations section | |||
| Less than 1 year | 173,588,505.64 | 3,404,132.87 | 1.96% |
| 1-2 years | 55,099,062.50 | 3,120,864.88 | 5.66% |
| 2-3 years | 36,449,159.27 | 4,649,273.54 | 12.76% |
| 3-4 years | 18,728,872.46 | 3,700,936.93 | 19.76% |
| 4-5 years | 12,212,812.57 | 5,271,209.90 | 43.16% |
| Over 5 years | 28,858,154.25 | 28,858,154.25 | 100.00% |
| Subtotal | 324,936,566.69 | 49,004,572.37 | 15.08% |
| Portfolio 2: Real estate business payments | |||
| Less than 1 year | 51,772,537.76 | 517,725.38 | 1.00% |
| 1-2 years | 23,856,457.95 | 1,192,822.90 | 5.00% |
| 2-3 years | 0.00 | 0.00 | 5.00% |
| 3-4 years | 161,108,351.60 | 24,166,252.74 | 15.00% |
| Subtotal | 236,737,347.31 | 25,876,801.02 | 10.93% |
| Combination 3: Other business models | |||
| Less than 1 year | 40,149,012.88 | 293,169.26 | 0.73% |
| 1-2 years | 29,134,316.13 | 612,198.92 | 2.10% |
| 2-3 years | 9,184,137.16 | 773,414.30 | 8.42% |
| 3-4 years | 1,112,151.28 | 275,591.09 | 24.78% |
| 4-5 years | 1,730.26 | 1,496.16 | 86.47% |
| Over 5 years | 408,342.69 | 408,342.69 | 100.00% |
| Subtotal | 79,989,690.40 | 2,364,212.42 | 2.96% |
| Total | 641,663,604.40 | 77,245,585.81 | -- |
If the provision for bad debts of accounts receivable is made in accordance with the general model of expected credit losses, pleaserefer to the disclosure of other receivables to disclose information about bad debts:
□ Applicable √ Inapplicable
Account age
In RMB
| Age | Closing balance |
| Within 1 year (inclusive) | 266,062,907.35 |
| 1-2 years | 111,391,117.14 |
| 2-3 years | 57,083,311.33 |
| Over 3 years | 304,864,167.55 |
| 3-4 years | 190,503,409.57 |
| 4-5 years | 37,247,531.59 |
| Over 5 years | 77,113,226.39 |
| Total | 739,401,503.37 |
The Company must comply with disclosure requirements of the Shenzhen Stock Exchange Industry Information DisclosureGuideline No.6 – Listed Companies Engaged in Decoration Business.
| Customer | Balance of accounts receivable of over 3 years | Bad debt provision corresponding to accounts receivable | Reason of the age | Whether there is a risk of recovery |
| Customer 1 | 53,281,747.13 | 53,281,747.13 | Customer credit status deteriorates | Yes |
| Customer 2 | 13,461,834.96 | 13,461,834.96 | Customer credit status deteriorates | Yes |
| Customer 3 | 17,374,148.42 | 17,033,021.55 | Customer credit status deteriorates | Yes |
| Total | 84,117,730.51 | 83,776,603.63 |
(2) Bad debt provision made, returned or recovered in the period
Bad debt provision made in the period:
In RMB
| Type | Opening balance | Change in the period | Closing balance | |||
| Provision | Written-back or recovered | Canceled | Others | |||
| Portfolio 1: Engineering operations section | 188,650,655.90 | 41,908,184.55 | 146,742,471.35 | |||
| Portfolio 2: Real estate business payments | 8,857,718.82 | 17,019,082.20 | 25,876,801.02 | |||
| Combination 3: Other business models | 2,362,172.94 | 2,039.48 | 2,364,212.42 | |||
| Total | 199,870,547.66 | 17,021,121.68 | 41,908,184.55 | 174,983,484.79 | ||
The reversal of the provision for bad debts of construction business accounts in this period was mainly due to the change in theexpected credit loss rate of accounts receivable in this period.
(3) Balance of top 5 accounts receivable at the end of the period
In RMB
| Entity | Closing balance of accounts receivable | Percentage (%) | Balance of bad debt provision at the end of the period |
| Customer 1 | 159,590,068.80 | 21.58% | 21,711,203.32 |
| Customer 2 | 55,266,682.05 | 7.47% | 55,266,682.05 |
| Customer 3 | 23,791,352.80 | 3.22% | 3,568,702.92 |
| Customer 4 | 23,252,449.78 | 3.14% | 456,000.52 |
| Customer 5 | 22,475,765.58 | 3.04% | 1,916,810.97 |
| Total | 284,376,319.01 | 38.45% |
(4) Receivables derecognized due to transfer of financial assets
| Item | Transfer method of financial assets | De-recognized amount | Gain or loss related to the de-recognition |
| Customer 1 | Factoring | 3,368,921.78 | -202,198.85 |
| Customer 2 | Factoring | 490,899.13 | -19,989.14 |
| Customer 3 | Factoring | 4,819,475.00 | -190,919.60 |
| Customer 4 | Factoring | 10,592,527.22 | -440,331.67 |
| Customer 5 | Factoring | 5,130,984.12 | -245,014.66 |
| Customer 6 | Factoring | 1,231,561.03 | -63,617.65 |
| Customer 7 | Factoring | 8,289,670.58 | -404,847.23 |
| Total | 33,924,038.86 | -1,566,918.80 |
Note: In the current period, the company handled the factoring of accounts receivable without recourse, and the factoring amount wasRMB 33,924,038.86. At the same time, the book balance of accounts receivable was derecognized at RMB 33,924,038.86.
6. Receivable financing
In RMB
| Item | Closing balance | Opening balance |
| Notes receivable | 300,000.00 | 2,954,029.00 |
| Total | 300,000.00 | 2,954,029.00 |
Increase or decrease in the current period of receivables financing and changes in fair value
□ Applicable √ Inapplicable
If the provision for financing impairment of receivables is accrued in accordance with the general expected credit loss model, pleaserefer to the disclosure of other receivables to disclose the relevant information of the impairment provision:
□ Applicable √ Inapplicable
7. Prepayment
(1) Account age of prepayments
In RMB
| Age | Closing balance | Opening balance | ||
| Amount | Proportion | Amount | Proportion | |
| Less than 1 year | 23,861,139.29 | 68.33% | 14,025,617.54 | 65.77% |
| 1-2 years | 7,902,770.87 | 22.63% | 5,895,327.15 | 27.64% |
| 2-3 years | 543,969.67 | 1.56% | 473,487.72 | 2.22% |
| Over 3 years | 2,611,509.00 | 7.48% | 932,676.77 | 4.37% |
| Total | 34,919,388.83 | -- | 21,327,109.18 | -- |
Explanation of non-settlement of significant prepayments with an accounting age of more than 1 year:
| Entity | Closing balance of book value | Age | Reason |
| Guangdong Xingfa Aluminium Co., Ltd. | 6,244,661.31 | 1-2 years | Not mature |
(2) Balance of top 5 prepayments at the end of the period
The total of top5 prepayments in terms of the prepaid entities in the period is RMB15,219,611.63, accounting for 43.58% of the totalprepayments at the end of the period.
8. Other receivables
In RMB
| Item | Closing balance | Opening balance |
| Other receivables | 158,674,891.12 | 139,947,655.35 |
| Total | 158,674,891.12 | 139,947,655.35 |
(1) Other receivables
1) Other receivables are disclosed by nature
In RMB
| By nature | Closing balance of book value | Opening balance of book value |
| Deposit | 116,035,799.08 | 103,782,569.80 |
| Construction borrowing and advanced payment | 32,408,043.13 | 34,052,644.05 |
| Staff borrowing and petty cash | 2,009,402.33 | 1,717,094.83 |
| Receivable refund of VAT | 2,124,028.86 | 548,129.42 |
| Debt by Luo Huichi | 12,992,291.48 | 12,992,291.48 |
| Others | 19,411,431.41 | 12,502,878.08 |
| Total | 184,980,996.29 | 165,595,607.66 |
2) Method of bad debt provision
In RMB
| Bad debt provision | First stage | Second stage | Third stage | Total |
| Expected credit losses in the next 12 months | Expected credit loss for the entire duration (no credit impairment) | Expected credit loss for the entire duration (credit impairment has occurred) | ||
| Balance on January 01, 2020 | 2,113,622.44 | 6,415.10 | 23,527,914.77 | 25,647,952.31 |
| Balance on January 01, 2020 in the current period | —— | —— | —— | —— |
| -- transferred to the third stage | -150.00 | 150.00 | ||
| Provision | 570,976.94 | 3,466.09 | 337,040.41 | 911,483.44 |
| Transferred back in the current period | 67,206.05 | 174.00 | 185,950.53 | 253,330.58 |
| Balance on June 30, 2020 | 2,617,393.33 | 9,707.19 | 23,679,004.65 | 26,306,105.17 |
Changes in book balances with significant changes in the current period
□ Applicable √ Inapplicable
Account age
In RMB
| Age | Closing balance |
| Within 1 year (inclusive) | 54,570,812.26 |
| 1-2 years | 81,932,549.03 |
| 2-3 years | 23,957,588.91 |
| Over 3 years | 24,520,046.09 |
| 3-4 years | 3,569,009.30 |
| 4-5 years | 17,047,699.71 |
| Over 5 years | 3,903,337.08 |
| Total | 184,980,996.29 |
3) Bad debt provision made, returned or recovered in the period
Bad debt provision made in the period:
In RMB
| Type | Opening balance | Change in the period | Closing balance | |||
| Provision | Written-back or recovered | Canceled | Others | |||
| Other receivables and bad debt provision | 25,647,952.31 | 911,483.44 | 253,330.58 | 26,306,105.17 | ||
| Total | 25,647,952.31 | 911,483.44 | 253,330.58 | 26,306,105.17 | ||
4) Balance of top 5 other receivables at the end of the period
In RMB
| Entity | By nature | Closing balance | Age | Percentage (%) | Balance of bad debt provision at the end of the period |
| Shenzhen Yikang Real Estate Co. Ltd. | Deposit/advancement of service fee | 70,062,675.83 | 1-2 years | 37.88% | 1,043,933.87 |
| Bangshen Electronics (Shenzhen) Co., Ltd. | Deposit | 20,000,000.00 | 2-3 years | 10.81% | 298,000.00 |
| Luo Huichi | Debt by SOZN | 12,992,291.48 | 4-5 years | 7.02% | 12,992,291.48 |
| China Merchants Futures Brokerage Co., Ltd. | Futures margin | 11,695,766.00 | Less than 1 year | 6.32% | 174,266.91 |
| Shenzhen Henggang Dakang Co., Ltd. | Deposit | 8,044,000.00 | 1-2 years | 4.35% | 119,855.60 |
| Total | -- | 122,794,733.31 | -- | 66.38% | 14,628,347.86 |
5) Items involving government subsidies:
In RMB
| Entity | Governmental subsidy | Closing balance | Closing age | Estimated time, amount and basis of receipt |
| Shenzhen Qianhai Taxation Bureau | VAT rebated | 2,124,028.86 | Less than 1 year | It can be recovered in time after receiving the tax refund (fee) approval notice from the tax bureau |
9. Inventories
Whether the Company needs to comply with disclosure requirements of the real estate industry.Yes
(1) Classification of inventories
The Company must comply with disclosure requirements of the Shenzhen Stock Exchange Industry Information DisclosureGuideline No.3 – Listed Companies Engaged in Property Development.Classified by nature:
In RMB
| Item | Closing balance | Opening balance | ||||
| Remaining book value | Provision for inventory depreciation or contract performance cost impairment provision | Book value | Remaining book value | Provision for inventory depreciation or contract performance cost impairment provision | Book value | |
| Development cost | 403,739,412.35 | 403,739,412.35 | 365,194,941.67 | 365,194,941.67 | ||
| Development products | 99,770,918.78 | 99,770,918.78 | 99,770,918.78 | 99,770,918.78 | ||
| Raw materials | 89,660,697.09 | 563,013.42 | 89,097,683.67 | 68,623,793.04 | 563,013.42 | 68,060,779.62 |
| Product in process | 51,477,301.56 | 51,477,301.56 | 59,444,230.45 | 59,444,230.45 | ||
| Finished goods in stock | 8,019,940.64 | 8,019,940.64 | 7,500,273.11 | 7,500,273.11 | ||
| Assets unsettled for finished construction contracts | 127,147,139.99 | 1,430,361.92 | 125,716,778.07 | 133,002,090.91 | 1,430,361.92 | 131,571,728.99 |
| Low price consumable | 44,694.66 | 44,694.66 | 146,018.01 | 146,018.01 | ||
| OEM materials | 2,036,765.73 | 2,036,765.73 | 2,022,252.83 | 2,022,252.83 | ||
| Total | 781,896,870.80 | 1,993,375.34 | 779,903,495.46 | 735,704,518.80 | 1,993,375.34 | 733,711,143.46 |
Development cost and capitalization rate of its interest are disclosed as follows:
In RMB
| Project | Starting time | Estimated finish time | Estimated total investment | Opening balance | Transferred to development product in this period | Other decrease in this period | Increase (development cost) in this period | Closing balance | Accumulative capitalized interest | Including: capitalized interest for the current period | Capital source |
| Jiangxi Phoenix Land project | 1 May 2018 | 12 December 2020 | 670,000,000.00 | 197,466,278.49 | 4,508,952.10 | 201,975,230.59 | 5,495,748.30 | 2,697,619.95 | Bank loan and self-owned fund | ||
| Dakang Village Project in Shenzhen | 1 December 2023 | 31 December 2029 | 3,600,000,000.00 | 166,868,479.94 | 30,384,079.93 | 197,252,559.87 | Bank loan and self-owned fund | ||||
| Fangda Bangshen Industry Park | 1 December 2020 | 31 December 2022 | 870,000,000.00 | 860,183.24 | 3,651,438.65 | 4,511,621.89 | Bank loan and self-owned fund | ||||
| Total | -- | -- | 5,140,000,000.00 | 365,194,941.67 | 38,544,470.68 | 403,739,412.35 | 5,495,748.30 | 2,697,619.95 | -- |
Disclose the main project information of "Development Products" according to the following format:
In RMB
| Project | Completion time | Opening balance | Increase | Decrease | Closing balance | Accumulative capitalized | Including: capitalized |
| interest | interest for the current period | ||||||
| Phase I of Fangda Town | 29 December 2016 | 99,770,918.78 | 99,770,918.78 | 4,314,190.09 | 0.00 | ||
| Total | -- | 99,770,918.78 | 99,770,918.78 | 4,314,190.09 | 0.00 |
(2) Provision for inventory depreciation and contract performance cost impairment provisionThe inventory depreciation provision is disclosed as follows:
Classified by nature:
In RMB
| Item | Opening balance | Increase in this period | Decrease in this period | Closing balance | Remarks | ||
| Provision | Others | Recover or write-off | Others | ||||
| Raw materials | 563,013.42 | 563,013.42 | |||||
| Assets unsettled for finished construction contracts | 1,430,361.92 | 1,430,361.92 | |||||
| Total | 1,993,375.34 | 1,993,375.34 | -- | ||||
(3) Capitalization rate of interest in the closing inventory balance
As at 30 June 2020, the amount of the capitalization of borrowing costs in the balance of the end-of-period inventory wasRMB9,809,938.39.
(4) Restriction of inventory
Restricted inventory is disclosed by project
In RMB
| Project | Opening balance | Closing balance | Reason |
| Jiangxi Phoenix Land project | 99,936,207.50 | 99,936,207.50 | Loan by pledge |
| Total | 99,936,207.50 | 99,936,207.50 | -- |
10. Contract assets
In RMB
| Item | Closing balance | Opening balance | ||||
| Remaining book value | Impairment provision | Book value | Remaining book value | Impairment provision | Book value | |
| Engineering operation portfolio | 1,856,679,366.07 | 197,356,098.59 | 1,659,323,267.48 | 1,476,897,495.34 | 230,109,023.56 | 1,246,788,471.78 |
| Real estate portfolio | 183,381,421.60 | 17,224,488.66 | 166,156,932.94 | |||
| Other business portfolio | 40,591,306.96 | 757,229.44 | 39,834,077.52 | 58,537,050.01 | 1,404,369.18 | 57,132,680.83 |
| Total | 1,897,270,673.03 | 198,113,328.03 | 1,699,157,345.00 | 1,718,815,966.95 | 248,737,881.40 | 1,470,078,085.55 |
The amount and reasons for major changes in the book value of contract assets during the current period:
In RMB
| Item | Change | Reason |
| Engineering operation portfolio | 412,534,795.70 | Mainly due to the realization of sales and confirmation of contract assets according to contract performance |
| Real estate portfolio | -166,156,932.94 | Mainly because the real estate certificate of Fangda Town No. 3 Building has been completed, and the contract payment conditions have been met and converted into accounts receivable |
| Other business portfolio | -17,298,603.31 | Mainly due to the conversion to accounts receivable after meeting the contract collection conditions |
| Total | 229,079,259.45 | —— |
If the provision for bad debts of contract assets is made in accordance with the general model of expected credit losses, please refer tothe disclosure of other receivables to disclose information about bad debts:
□ Applicable √ Inapplicable
Provision made for bad debts of contract assets in this period
In RMB
| Item | Provision | Transferred back in the current period | Written off in the current period | Reason |
| Engineering operation portfolio | 32,752,924.97 | Mainly due to changes in the expected credit loss rate of contract assets in the current period | ||
| Real estate portfolio | 17,224,488.66 | Mainly due to the conversion to accounts receivable after meeting the contract collection conditions | ||
| Other business portfolio | 647,139.74 | |||
| Total | 50,624,553.37 | -- |
11. Other current assets
In RMB
| Item | Closing balance | Opening balance |
| Tax to be input | 33,667,829.72 | 25,724,810.99 |
| Prepaid income tax | 12,079,853.70 | 10,942,500.38 |
| Structural loan | 201,790,136.99 | 207,993,374.07 |
| Reclassification of VAT debit balance | 82,046,512.69 | 79,104,900.46 |
| Others | 165,020.00 | |
| Total | 329,749,353.10 | 323,765,585.90 |
12. Long-term share equity investment
In RMB
| Invested entity | Opening book value | Change (+,-) | Closing book value | Balance of impairment provision at the end of the period | |||||||
| Increased investment | Decreased investment | Investment gain and loss recognized using the equity method | Other miscellaneous income adjustment | Other equity change | Cash dividend or profit announced | Impairment provision | Others | ||||
| 1. Joint venture | |||||||||||
| 2. Associate | |||||||||||
| Shenzhen Ganshang Joint Investment Co., Ltd. (Shenzhen Ganshang) | 2,360,044.01 | 3,071.91 | 2,363,115.92 | ||||||||
| Jiangxi Business Innovative Property Joint | 54,862,196.82 | -378,274.00 | 54,483,922.82 | ||||||||
| Stock Co., Ltd. | |||||||||||
| Subtotal | 57,222,240.83 | -375,202.09 | 56,847,038.74 | ||||||||
| Total | 57,222,240.83 | -375,202.09 | 56,847,038.74 |
13. Investment in other equity tools
In RMB
| Item | Closing balance | Opening balance |
| Unlisted equity instrument investment | 20,140,037.85 | 20,660,181.44 |
| Total | 20,140,037.85 | 20,660,181.44 |
Sub-disclosure of non-tradable equity instrument investment in the current period
In RMB
| Project | Dividend recognized in the period | Total gain | Total loss | Amount of other comprehensive income transferred to retained earnings | Reason for measurement at fair value with variations accounted into current income account | Reason for transfer of other miscellaneous into income |
| Shenyang Fangda | 9,958,565.45 | Non-trading equity instruments | ||||
| Shenzhen Huihai Yirong Internet Service Co., Ltd. | 2,941,535.45 | Non-trading equity instruments |
14. Other non-current financial assets
In RMB
| Item | Closing balance | Opening balance |
| Financial assets measured at fair value with variations accounted into current income account | 5,018,835.30 | 5,009,728.02 |
| Total | 5,018,835.30 | 5,009,728.02 |
IX. Investment real estates
(1) Investment real estate measured at costs
√ Applicable □ Inapplicable
In RMB
| Item | Houses & buildings | Land using right | Construction in process | Total |
| I. Book value | ||||
| 1. Opening balance | 29,047,361.20 | 194,300,196.90 | 223,347,558.10 | |
| 2. Increase in this period | 5,002,352.86 | 5,002,352.86 | ||
| (1) External purchase | 5,002,352.86 | 5,002,352.86 | ||
| 3. Decrease in this period | 18,636,669.33 | 18,636,669.33 | ||
| (1) Disposal | ||||
| (2) Other transfer-out | 18,636,669.33 | 18,636,669.33 | ||
| 4. Closing balance | 10,410,691.87 | 199,302,549.76 | 209,713,241.63 | |
| II. Accumulative depreciation and amortization | ||||
| 1. Opening balance | 7,071,934.11 | 7,071,934.11 | ||
| 2. Increase in this period | 134,565.12 | 134,565.12 | ||
| (1) Provision or amortization | 134,565.12 | 134,565.12 | ||
| 3. Decrease in this period | 3,287,340.60 | 3,287,340.60 | ||
| (1) Disposal | ||||
| (2) Other transfer-out | 3,287,340.60 | 3,287,340.60 | ||
| 4. Closing balance | 3,919,158.63 | 3,919,158.63 | ||
| III. Impairment provision | ||||
| 1. Opening balance | 0.00 | 0.00 | 0.00 | |
| 2. Increase in this period | 0.00 | 0.00 | 0.00 | |
| 3. Decrease in this period | 0.00 | 0.00 | 0.00 | |
| 4. Closing balance | 0.00 | 0.00 | 0.00 | |
| IV. Book value | ||||
| 1. Closing book value | 6,491,533.24 | 199,302,549.76 | 205,794,083.00 | |
| 2. Opening book value | 21,975,427.09 | 194,300,196.90 | 216,275,623.99 |
Note: The other transfer of RMB 18,636,669.33 was due to the needs of business development and the transfer of part of theindustrial plant of the subsidiary Zhichuang Technology Company from external lease to self-use.
(2) Investment real estate measured at fair value
√ Applicable □ Inapplicable
In RMB
| Item | Houses & buildings | Land using right | Construction in process | Total |
| I. Opening balance | 5,306,116,360.12 | 5,306,116,360.12 | ||
| II. Change in this period | 5,919,471.95 | 5,919,471.95 | ||
| Add: external purchase | 5,919,471.95 | 5,919,471.95 | ||
| Less: disposal | ||||
| Change in fair value | ||||
| III. Closing balance | 5,312,035,832.07 | 5,312,035,832.07 |
The Company must comply with disclosure requirements of the Shenzhen Stock Exchange Industry Information DisclosureGuideline No.3 – Listed Companies Engaged in Property Development.Disclosure of investment real estate measured at fair value by projects
In RMB
| Project | Location | Completion time | Building area | Rental income in the report period | Opening fair value | Closing fair value | Change in fair value | Reason for the change and report |
| Commercial podium of Fangda Town | Shenzhen | 11 October 2017 | 22,565.42 | 13,749,074.50 | 1,290,742,024.00 | 1,290,742,024.00 | ||
| Building 1# of Fangda Town | Shenzhen | 29 December 2018 | 72,517.71 | 21,557,763.27 | 3,720,019,334.12 | 3,725,938,806.07 | 0.16% | New decoration and other investment in this period |
| Fangda Building | Shenzhen | 28 December 2002 | 17,792.47 | 7,971,681.38 | 295,355,002.00 | 295,355,002.00 | ||
| Total | —— | —— | 112,875.60 | 43,278,519.15 | 5,306,116,360.12 | 5,312,035,832.07 | 0.11% | —— |
Whether the company has investment real estate in the current construction period
√ Yes □ No
The investment real estate in the construction period of the current period:
In RMB
| Project | Location | Date of commencement | Estimated total investment | Opening amount | Closing amount | Estimated finish time |
| Jiangxi Phoenix | Nanchang | 1 May 2018 | 670,000,000.00 | 194,300,196.90 | 199,302,549.76 | 12 December |
| Land project | 2020 | |||||
| Total | —— | —— | 670,000,000.00 | 194,300,196.90 | 199,302,549.76 | —— |
Whether there is new investment real estate measured at fair value in the report period
□ Yes √ No
(3) Investment real estate without ownership certificate
In RMB
| Item | Book value | Reason |
| Jiangxi Phoenix Land project | 199,302,549.76 | Conditions for applying for property right are not met |
16. Fixed assets
In RMB
| Item | Closing balance | Opening balance |
| Fixed assets | 484,397,283.68 | 477,332,830.92 |
| Total | 484,397,283.68 | 477,332,830.92 |
(1) Fixed assets
In RMB
| Item | Houses & buildings | Mechanical equipment | Transportation facilities | Electronics and other devices | PV power plants | Total |
| I. Original book value: | ||||||
| 1. Opening balance | 397,489,124.24 | 129,679,176.79 | 21,359,342.69 | 44,608,708.34 | 129,596,434.84 | 722,732,786.90 |
| 2. Increase in this period | 18,636,669.33 | 2,843,131.80 | 21,792.06 | 819,189.17 | 22,320,782.36 | |
| (1) Purchase | 2,843,131.80 | 21,792.06 | 808,175.98 | 3,673,099.84 | ||
| (2) Transfer-in of construction in progress | ||||||
| (3) Other increases | 18,636,669.33 | 11,013.19 | 18,647,682.52 | |||
| 3. Decrease in this period | 25,794.13 | 572,649.58 | 7,753.85 | 318,155.65 | 924,353.21 |
| (1) Disposal or retirement | 572,649.58 | 7,753.85 | 318,155.65 | 898,559.08 | ||
| (2) Other decrease | 25,794.13 | 25,794.13 | ||||
| 4. Closing balance | 416,099,999.44 | 131,949,659.01 | 21,373,380.90 | 45,109,741.86 | 129,596,434.84 | 744,129,216.05 |
| II. Accumulative depreciation | ||||||
| 1. Opening balance | 75,577,918.79 | 102,194,972.59 | 15,634,519.78 | 28,429,239.34 | 22,208,915.98 | 244,045,566.48 |
| 2. Increase in this period | 8,800,315.87 | 1,936,391.79 | 299,694.60 | 965,824.25 | 3,074,220.06 | 15,076,446.57 |
| (1) Provision | 5,521,975.27 | 1,936,391.79 | 299,694.60 | 965,824.25 | 3,074,220.06 | 11,798,105.97 |
| (2) Other increases | 3,278,340.60 | 3,278,340.60 | ||||
| 3. Decrease in this period | 462,977.80 | 6,978.46 | 274,513.92 | 744,470.18 | ||
| (1) Disposal or retirement | 462,977.80 | 6,978.46 | 274,513.92 | 744,470.18 | ||
| 4. Closing balance | 84,378,234.66 | 103,668,386.58 | 15,927,235.92 | 29,120,549.67 | 25,283,136.04 | 258,377,542.87 |
| III. Impairment provision | ||||||
| 1. Opening balance | 1,297,621.81 | 56,767.69 | 1,354,389.50 | |||
| 2. Increase in this period | ||||||
| 3. Decrease in this period | ||||||
| 4. Closing balance | 1,297,621.81 | 56,767.69 | 1,354,389.50 | |||
| IV. Book value | ||||||
| 1. Closing book value | 331,721,764.78 | 26,983,650.62 | 5,446,144.98 | 15,932,424.50 | 104,313,298.80 | 484,397,283.68 |
| 2. Opening book value | 321,911,205.45 | 26,186,582.39 | 5,724,822.91 | 16,122,701.31 | 107,387,518.86 | 477,332,830.92 |
(2) Fixed assets without ownership certificate
In RMB
| Item | Book value | Reason |
| Houses in Urumuqi for offsetting debt | 504,584.19 | Historical reasons |
| Yuehai Office Building C 502 | 127,598.25 | Historical reasons |
| Construction of Chengdu Fangda Xinjin Base | 26,033,117.71 | In the process of applying for property right certificate |
17. Construction in process
In RMB
| Item | Closing balance | Opening balance |
| Construction in process | 138,881,024.27 | 129,988,982.86 |
| Total | 138,881,024.27 | 129,988,982.86 |
(1) Construction in progress
In RMB
| Item | Closing balance | Opening balance | ||||
| Remaining book value | Impairment provision | Book value | Remaining book value | Impairment provision | Book value | |
| Construction and decoration of self-use part of Building 1 of Fangda Town | 54,741,274.27 | 54,741,274.27 | 54,275,503.95 | 54,275,503.95 | ||
| Fangda Group East China Construction Base Project | 82,806,788.86 | 82,806,788.86 | 75,473,740.65 | 75,473,740.65 | ||
| System of intelligent gluing robot | 23,242.53 | 23,242.53 | 23,242.53 | 23,242.53 | ||
| Standard production line | 288,563.73 | 288,563.73 | 216,495.73 | 216,495.73 | ||
| Fangda Hope Primary School | 714,521.85 | 714,521.85 | ||||
| Xuanfeng power station power safety monitoring system and renewable energy big data platform access system project | 117,000.00 | 117,000.00 | ||||
| Xinjin plant gas system installation project | 189,633.03 | 189,633.03 | ||||
| Total | 138,881,024.27 | 138,881,024.27 | 129,988,982.86 | 129,988,982.86 |
(2) Changes in major construction in process in this period
In RMB
| Project | Budget | Opening balance | Increase in this period | +Amount transfer-in to fixed assets in this period | Other decrease in this period | Closing balance | Proportion of accumulative engineering investment in the budget | Project progress | Accumulative capitalized interest | Including: capitalized interest for the current period | Interest capitalization rate | Capital source |
| Construction and decoration of self-use part of Building 1 of Fangda Town | 74,270,000.00 | 54,275,503.95 | 465,770.32 | 54,741,274.27 | 79.39% | 79.39% | 3,253,136.04 | Self-owned fund | ||||
| Fangda Group East China Construction Base | 102,586,625.00 | 75,473,740.65 | 7,333,048.21 | 82,806,788.86 | 80.72% | 80.72% | 14,499,831.54 | 1,111,990.87 | 5.46% | Own funds and loans from financial institutio |
| Project | ns | |||||||||||
| Total | 176,856,625.00 | 129,749,244.60 | 7,798,818.53 | 137,548,063.13 | -- | -- | 17,752,967.58 | 1,111,990.87 | 5.46% | -- |
18. Intangible assets
(1) Intangible assets
In RMB
| Item | Land using right | Patent | Software | Total |
| I. Book value | ||||
| 1. Opening balance | 78,751,482.29 | 8,966,866.05 | 17,892,864.49 | 105,611,212.83 |
| 2. Increase in this period | 13,000.00 | 43,439.82 | 56,439.82 | |
| (1) Purchase | 13,000.00 | 43,439.82 | 56,439.82 | |
| 3. Decrease in this period | ||||
| (1) Disposal | ||||
| 4. Closing balance | 78,751,482.29 | 8,979,866.05 | 17,936,304.31 | 105,667,652.65 |
| II. Accumulative amortization | ||||
| 1. Opening balance | 12,802,236.28 | 8,028,555.36 | 6,458,156.14 | 27,288,947.78 |
| 2. Increase in this period | 1,131,134.80 | 234,613.29 | 751,883.48 | 2,117,631.57 |
| (1) Provision | 1,131,134.80 | 234,613.29 | 751,883.48 | 2,117,631.57 |
| 3. Decrease in this period | ||||
| 4. Closing balance | 13,933,371.08 | 8,263,168.65 | 7,210,039.62 | 29,406,579.35 |
| III. Impairment provision | ||||
| 1. Opening balance | ||||
| 2. Increase in this period | ||||
| 3. Decrease in |
| this period | ||||
| 4. Closing balance | ||||
| IV. Book value | ||||
| 1. Closing book value | 64,818,111.21 | 716,697.40 | 10,726,264.69 | 76,261,073.30 |
| 2. Opening book value | 65,949,246.01 | 938,310.69 | 11,434,708.35 | 78,322,265.05 |
Intangible asset formed by internal R&D of the period takes up 11.60% in the closing total book value of intangible assets.
(XIX) Long-term amortizable expenses
In RMB
| Item | Opening balance | Increase in this period | Amortized amount in this period | Other decrease | Closing balance |
| Xuanfeng Chayuan village and Zhuyuan village land transfer compensation | 1,140,730.22 | 28,050.78 | 1,112,679.44 | ||
| Reconstruction project of sample room | 462,854.58 | 57,856.80 | 404,997.78 | ||
| Membership fee | 637,499.92 | 6,250.00 | 115,000.02 | 528,749.90 | |
| Waterproofing works for employee dormitories | 460,084.29 | 49,294.74 | 410,789.55 | ||
| Management consulting service fee | 901,552.04 | 238,121.77 | 663,430.27 | ||
| Warehouse addition and renovation project | 272,477.07 | 30,275.22 | 242,201.85 | ||
| Addition and renovation project of glue area | 541,284.40 | 90,214.08 | 451,070.32 | ||
| Others | 149,512.81 | 581.32 | 148,931.49 | ||
| Total | 3,875,198.12 | 697,047.21 | 609,394.73 | 3,962,850.60 |
20. Differed income tax assets and differed income tax liabilities
(1) Non-deducted deferred income tax assets
In RMB
| Item | Closing balance | Opening balance | ||
| Deductible temporary difference | Deferred income tax assets | Deductible temporary difference | Deferred income tax assets | |
| Assets impairment provision | 93,590,747.27 | 23,063,418.45 | 93,590,747.27 | 23,063,418.45 |
| Deductible loss | 281,570,405.26 | 68,828,235.41 | 271,310,599.01 | 67,626,700.92 |
| Unrealizable gross profit | 121,664,373.75 | 29,786,127.24 | 119,543,729.80 | 29,233,320.47 |
| Credit impairment provision | 399,313,861.39 | 64,051,091.44 | 473,809,506.79 | 75,229,494.57 |
| Provided unpaid taxes | 583,427,563.55 | 145,856,890.89 | 584,599,356.81 | 146,149,839.20 |
| Anticipated liabilities | 4,426,285.92 | 663,942.89 | 7,793,527.16 | 1,169,029.07 |
| Donation | 1,700,000.00 | 425,000.00 | 700,000.00 | 175,000.00 |
| Reserved expense | 1,742,978.53 | 261,446.78 | ||
| Deferred earning | 2,449,739.03 | 363,028.88 | 2,346,742.62 | 347,579.43 |
| Others | 413,650.31 | 93,735.81 | ||
| Total | 1,488,142,976.17 | 333,037,735.20 | 1,555,850,838.30 | 343,349,564.70 |
(2) Non-deducted deferred income tax liabilities
In RMB
| Item | Closing balance | Opening balance | ||
| Taxable temporary difference | Deferred income tax liabilities | Taxable temporary difference | Deferred income tax liabilities | |
| Change in fair value | 4,102,516,372.60 | 1,025,447,525.51 | 4,101,290,434.14 | 1,025,322,608.53 |
| Estimated gross margin when Fangda Town records income, but does not reach the taxable income level | 108,771,380.35 | 27,192,845.09 | 132,104,998.74 | 33,026,249.69 |
| Acquire premium to form inventory | 1,535,605.48 | 383,901.37 | 1,535,605.47 | 383,901.37 |
| Rental income | 25,774,151.06 | 6,443,537.78 | 20,401,597.60 | 5,100,399.41 |
| Total | 4,238,597,509.49 | 1,059,467,809.75 | 4,255,332,635.95 | 1,063,833,159.00 |
(3) Net deferred income tax assets or liabilities listed
In RMB
| Item | Deferred income tax assets and liabilities at the end of the period | Offset balance of deferred income tax assets or liabilities after offsetting | Deferred income tax assets and liabilities at the beginning of the period | Offset balance of deferred income tax assets or liabilities after offsetting |
| Deferred income tax assets | 333,037,735.20 | 343,349,564.70 | ||
| Deferred income tax liabilities | 1,059,467,809.75 | 1,063,833,159.00 |
(4) Details of unrecognized deferred income tax assets
In RMB
| Item | Closing balance | Opening balance |
| Deductible temporary difference | 89,056.59 | 446,874.58 |
| Deductible loss | 7,087,089.46 | 8,983,744.38 |
| Total | 7,176,146.05 | 9,430,618.96 |
(5) Deductible losses of the un-recognized deferred income tax asset will expire in the following years
In RMB
| Year | Closing amount | Opening amount | Remarks |
| 2020 | 30,257.35 | 30,257.35 | |
| 2021 | 0.00 | 0.00 | |
| 2022 | 1,270,623.72 | 2,286,265.51 | |
| 2023 | 4,575,983.46 | 5,390,985.76 | |
| 2024 | 798,893.17 | 1,276,235.76 | |
| 2025 | 411,331.76 | ||
| Total | 7,087,089.46 | 8,983,744.38 | -- |
21. Other non-current assets
In RMB
| Item | Closing balance | Opening balance | ||||
| Remaining book value | Impairment provision | Book value | Remaining book value | Impairment provision | Book value | |
| Prepaid house and equipment amount | 37,015,653.0 | 37,015,653.0 | 28,446,802.0 | 28,446,802.0 | ||
| 0 | 0 | 0 | 0 | |||
| Prepaid engineering amount | 255,000.00 | 255,000.00 | ||||
| Total | 37,015,653.00 | 37,015,653.00 | 28,701,802.00 | 28,701,802.00 |
22. Short-term borrowings
(1) Classification of short-term borrowings
In RMB
| Item | Closing balance | Opening balance |
| Loan by pledge | 30,008,266.67 | 200,318,605.55 |
| Guarantee loan | 418,726,349.99 | 216,287,991.79 |
| Credit borrow | 300,091,250.00 | 8,011,600.00 |
| The Group's internal acceptance bills discounted borrowings | 531,809,800.00 | 300,000,000.00 |
| Total | 1,280,635,666.66 | 724,618,197.34 |
23. Derivative financial liabilities
In RMB
| Item | Closing balance | Opening balance |
| Forward foreign exchange contract | 96,767.62 | |
| Total | 96,767.62 |
24. Notes payable
In RMB
| Type | Closing balance | Opening balance |
| Commercial acceptance | 154,105,118.94 | 129,241,328.76 |
| Bank acceptance | 377,373,250.29 | 449,574,698.68 |
| Total | 531,478,369.23 | 578,816,027.44 |
The total amount of payable bills that have matured but not been paid at the end of the period is RMB0.00.
25. Account payable
(1) Account payable
In RMB
| Item | Closing balance | Opening balance |
| Account repayable and engineering repayable | 830,540,797.17 | 811,680,369.67 |
| Construction payable | 22,175,837.84 | 75,375,776.11 |
| Payable installation and implementation fees | 249,475,834.32 | 297,516,473.34 |
| Others | 4,404,991.26 | 6,200,681.12 |
| Total | 1,106,597,460.59 | 1,190,773,300.24 |
(2) Significant payables aging more than 1 year
In RMB
| Item | Closing balance | Reason |
| Supplier 1 | 47,481,709.04 | Not mature |
| Supplier 2 | 17,655,833.07 | Not mature |
| Supplier 3 | 11,011,440.33 | Not mature |
| Supplier 4 | 7,381,161.50 | Not mature |
| Supplier 5 | 5,788,761.88 | Not mature |
| Total | 89,318,905.82 | -- |
26. Prepayment received
(1) Prepayment received
In RMB
| Item | Closing balance | Opening balance |
| Real estate lease payments received in advance | 4,195,179.31 | 1,332,457.45 |
| Total | 4,195,179.31 | 1,332,457.45 |
The Company must comply with disclosure requirements of the Shenzhen Stock Exchange Industry Information DisclosureGuideline No.3 – Listed Companies Engaged in Property Development.Payment received from top 5 presales projects:
In RMB
| No. | Project | Opening balance | Closing balance | Estimated finish time | Presales percentage |
| 1 | Jiangxi Phoenix Land project | 677,650.00 | 22,842,092.00 | December 2020 | 5.07% |
Note: The ending balance of the above-mentioned advance receipts of RMB22,842,092.00 shall be listed in contract liabilities andother current liabilities according to the new income standard.
27. Contract liabilities
In RMB
| Item | Closing balance | Opening balance |
| Engineering business | 110,649,396.36 | 120,396,559.54 |
| Real estate | 25,134,270.22 | 2,831,768.42 |
| Other businesses | 1,015,798.18 | 752,948.55 |
| Total | 136,799,464.76 | 123,981,276.51 |
The amount and reason for the significant change in the book value during the reporting period
In RMB
| Item | Change | Reason |
| Engineering business | -9,747,163.18 | Mainly due to the performance of the contract in the current period |
| Real estate | 22,302,501.80 | Mainly due to the funds obtained from the pre-sale of real estate in the current period |
| Other businesses | 262,849.63 | |
| Total | 12,818,188.25 | —— |
28. Employees’ wage payable
(1) Employees’ wage payable
In RMB
| Item | Opening balance | Increase | Decrease | Closing balance |
| 1. Short-term remuneration | 55,534,644.34 | 134,819,463.16 | 165,836,253.15 | 24,517,854.35 |
| 2. Retirement pension program-defined contribution plan | 25,334.86 | 2,258,671.22 | 2,208,392.42 | 75,613.66 |
| 3. Dismiss compensation | 287,155.00 | 560,450.00 | 847,605.00 | |
| Total | 55,847,134.20 | 137,638,584.38 | 168,892,250.57 | 24,593,468.01 |
(2) Short-term remuneration
In RMB
| Item | Opening balance | Increase | Decrease | Closing balance |
| 1. Wage, bonus, allowance and subsidies | 54,054,805.08 | 126,366,654.32 | 157,659,945.37 | 22,761,514.03 |
| 2. Employee welfare | 2,664,209.05 | 2,622,798.55 | 41,410.50 |
| 3. Social insurance | 8,812.80 | 2,002,672.02 | 1,867,944.09 | 143,540.73 |
| Including: medical insurance | 8,812.80 | 1,601,468.63 | 1,508,469.10 | 101,812.33 |
| Labor injury insurance | 151,104.28 | 150,107.05 | 997.23 | |
| Breeding insurance | 250,099.11 | 209,367.94 | 40,731.17 | |
| 4. Housing fund | 45,924.00 | 3,185,590.39 | 3,151,600.39 | 79,914.00 |
| 5. Labor union budget and staff education fund | 1,425,102.46 | 600,337.38 | 533,964.75 | 1,491,475.09 |
| Total | 55,534,644.34 | 134,819,463.16 | 165,836,253.15 | 24,517,854.35 |
(3) Defined contribution plan
In RMB
| Item | Opening balance | Increase | Decrease | Closing balance |
| 1. Basic pension | 25,334.86 | 2,190,347.33 | 2,141,731.97 | 73,950.22 |
| 2. Unemployment insurance | 68,323.89 | 66,660.45 | 1,663.44 | |
| Total | 25,334.86 | 2,258,671.22 | 2,208,392.42 | 75,613.66 |
29. Taxes payable
In RMB
| Item | Closing balance | Opening balance |
| VAT | 4,703,096.74 | 5,138,273.83 |
| Enterprise income tax | 11,103,995.91 | 8,013,627.51 |
| Personal income tax | 805,124.13 | 1,111,213.06 |
| City maintenance and construction tax | 1,044,730.49 | 1,499,926.15 |
| Land using tax | 412,829.44 | 241,855.73 |
| Property tax | 1,606,236.85 | 265,016.74 |
| Education surtax | 532,106.52 | 736,138.35 |
| Local education surtax | 216,369.67 | 352,390.86 |
| Land VAT | 31,084.86 | |
| Others | 862,911.01 | 459,460.59 |
| Total | 21,287,400.76 | 17,848,987.68 |
30. Other payables
In RMB
| Item | Closing balance | Opening balance |
| Other payables | 712,243,884.21 | 701,432,408.28 |
| Total | 712,243,884.21 | 701,432,408.28 |
(1) Other payables
1) Other payables presented by nature
In RMB
| Item | Closing balance | Opening balance |
| Performance and quality deposit | 48,650,845.18 | 46,117,111.79 |
| Deposit | 13,625,876.46 | 4,885,326.38 |
| Reserved expense | 11,810,759.96 | 17,194,987.92 |
| Tax withheld | 583,427,563.55 | 584,599,356.81 |
| Pledge | 300,000.00 | |
| Others | 54,728,839.06 | 48,335,625.38 |
| Total | 712,243,884.21 | 701,432,408.28 |
(2) Significant payables aging more than 1 year
In RMB
| Item | Closing balance | Reason |
| Shenzhen Yikang Real Estate Co. Ltd. | 18,606,927.46 | Affiliated party payment |
| Tax withheld | 573,957,082.47 | Land value-added tax has yet to be settled and paid |
| Total | 592,564,009.93 | -- |
31. Non-current liabilities due within 1 year
In RMB
| Item | Closing balance | Opening balance |
| Long-term loans due within 1 year | 151,617,767.59 | 922,346,563.72 |
| Total | 151,617,767.59 | 922,346,563.72 |
32. Other current liabilities
In RMB
| Item | Closing balance | Opening balance |
| Unterminated notes receivable | 36,807,182.46 | 169,688,481.80 |
| Substituted money on VAT | 10,537,838.72 | 12,006,092.67 |
| Others | 13,953,454.50 | 11,026,370.77 |
| Total | 61,298,475.68 | 192,720,945.24 |
33. Long-term borrowings
(1) Classification of long-term borrowings
In RMB
| Item | Closing balance | Opening balance |
| Loan by pledge | 293,978,153.39 | |
| Loan by pledge | 1,151,161,462.35 | 182,523,338.17 |
| Guarantee loan | 70,000,000.00 | |
| Total | 1,151,161,462.35 | 546,501,491.56 |
The interest rate period of long-term borrowings: adjust according to the agreed proportion based on the LPR interest rate, and theupper limit is 6.615%.
34. Anticipated liabilities
In RMB
| Item | Closing balance | Opening balance | Reason |
| Maintenance fee | 4,426,285.92 | 7,793,527.16 | Contract agreement |
| Total | 4,426,285.92 | 7,793,527.16 | -- |
35. Deferred earning
In RMB
| Item | Opening balance | Increase | Decrease | Closing balance | Reason |
| Government subsidy | 10,817,247.40 | 200,000.00 | 193,359.99 | 10,823,887.41 | See the following table |
| Total | 10,817,247.40 | 200,000.00 | 193,359.99 | 10,823,887.41 | -- |
Items involving government subsidies:
In RMB
| Liabilities | Opening | Amount of | Amount | Other misc. | Costs offset | Other | Closing | Related to |
| balance | new subsidy | included in non-operating revenue | gains recorded in this period | in the period | change | balance | assets/earning | |
| Railway transport screen door controlling system and information transmission technology | 77,653.85 | 9,452.16 | 68,201.69 | Assets-related | ||||
| Major investment project prize from Industry and Trade Development Division of Dongguan Finance Bureau | 1,623,809.90 | 28,571.40 | 1,595,238.50 | Assets-related | ||||
| Distributed PV power generation project subsidy sponsored by Dongguan Reform and Development Commission | 393,750.17 | 12,499.98 | 381,250.19 | Assets-related | ||||
| Subsidized land transfer | 177,278.87 | 1,862.82 | 175,416.05 | Assets-related | ||||
| Special subsidy for industrial transformation, upgrading and development | 800,000.00 | 20,000.01 | 779,999.99 | Assets-related | ||||
| Enterprise informationization subsidy project of Shenzhen Small and Medium Enterprise Service Agency | 468,000.00 | 24,000.00 | 444,000.00 | Assets-related | ||||
| National Industry Revitalization and Technology Renovation Project | 7,276,754.61 | 61,993.62 | 7,214,760.99 | Assets-related |
| fund | ||||||||
| Shenzhen Science and Technology Innovation Committee Technology Innovation Subsidy | 200,000.00 | 34,980.00 | 165,020.00 | Earning-related | ||||
| Total | 10,817,247.40 | 200,000.00 | 0.00 | 193,359.99 | 0.00 | 0.00 | 10,823,887.41 |
36. Capital share
In RMB
| Opening balance | Change (+,-) | Closing balance | |||||
| Issued new shares | Bonus shares | Transferred from reserves | Others | Subtotal | |||
| Total of capital shares | 1,123,384,189.00 | -35,105,238.00 | -35,105,238.00 | 1,088,278,951.00 | |||
Others:
The decrease in share capital was due to the repurchase and cancellation of B shares by the company during the reporting period.
37. Capital reserve
In RMB
| Item | Opening balance | Increase | Decrease | Closing balance |
| Capital premium (share capital premium) | 94.24 | 94.24 | ||
| Other capital reserves | 154,097.35 | 154,097.35 | ||
| Total | 1,454,191.59 | 1,454,191.59 |
38. Shares in stock
In RMB
| Item | Opening balance | Increase | Decrease | Closing balance |
| Shares in stock | 99,385,887.28 | 99,385,887.28 | ||
| Total | 99,385,887.28 | 99,385,887.28 |
Other note, including explanation about the reason of the change:
①The company held the nineteenth meeting of the eighth session of the board of directors and the first extraordinary general meetingof shareholders on November 28, 2019 and December 16, 2019, respectively, and reviewed and approved the company’s repurchaseof some domestically listed foreign shares (B shares). As of June 30, 2020, 35,105,238 shares were repurchased through centralizedbidding. The highest price was HKD 3.33 per share and the lowest price was HKD 2.45 per share. The actual cumulative payment of
108,930,044.20 Hong Kong dollars (including transaction costs) was included in the treasury stock of RMB 99,385,887.28. Yuan, onMay 20, 2020, the Shenzhen Branch of China Securities Depository and Clearing Co., Ltd. completed the repurchase andcancellation procedures of the above-mentioned shares.
② 35,105,238 shares of share capital reduced as a result of the write-off of treasury shares;
③If the cost of the cancelled inventory shares is higher than the corresponding cost of equity, the surplus reserve of RMB64,280,649.28 is offset when the cancellation is made.
39. Other miscellaneous income
In RMB
| Item | Opening balance | Amount occurred in the current period | Closing balance | |||||
| Amount before income tax | Less: amount written into other gains and transferred into gain/loss in previous terms | Less: amount written into other gains and transferred into gain/loss in previous terms | Less: Income tax expenses | After-tax amount attributed to the parent | After-tax amount attributed to minority shareholders | |||
| 1. Other misc. incomes that cannot be re-classified into gain and loss | -9,192,030.38 | -520,143.59 | -520,143.59 | -9,712,173.97 | ||||
| Fair value change of investment in other equity tools | -9,192,030.38 | -520,143.59 | -520,143.59 | -9,712,173.97 | ||||
| 2. Other misc. incomes that will be re-classified into gain and loss | 8,716,621.13 | 1,747,943.19 | 286,866.60 | 1,461,076.59 | 10,177,697.72 | |||
| Cash flow hedge reserve | -82,252.47 | 1,912,443.96 | 286,866.60 | 1,625,577.36 | 1,543,324.89 | |||
| Translation difference of foreign exchange statement | 42,320.14 | -164,500.77 | -164,500.77 | -122,180.63 | ||||
| Investment real estate measured at fair value | 8,756,553.46 | 8,756,553.46 | ||||||
| Other miscellaneous income | -475,409.25 | 1,227,799.60 | 286,866.60 | 940,933.00 | 465,523.75 | |||
40. Surplus reserves
In RMB
| Item | Opening balance | Increase | Decrease | Closing balance |
| Statutory surplus reserves | 159,805,930.34 | 64,280,649.28 | 95,525,281.06 | |
| Total | 159,805,930.34 | 64,280,649.28 | 95,525,281.06 |
The decrease in the surplus reserve in the current period was due to the fact that the cost of the cancelled treasury shares was higherthan the cost of the corresponding equity, and the surplus reserve was offset at the time of cancellation.
41. Retained profit
In RMB
| Item | Current period | Last period |
| Adjustment on retained profit of previous period | 3,898,626,177.99 | 3,921,225,872.96 |
| Total of retained profit at beginning of year adjusted (+ for increase, - for decrease) | 16,171,320.58 | |
| Retained profit adjusted at beginning of year | 3,898,626,177.99 | 3,937,397,193.54 |
| Plus: Net profit attributable to owners of the parent | 146,839,884.57 | 128,581,755.01 |
| Common share dividend payable | 54,413,947.55 | 224,676,837.79 |
| Closing retained profit | 3,991,052,115.01 | 3,841,302,110.76 |
42. Operational revenue and costs
In RMB
| Item | Amount occurred in the current period | Occurred in previous period | ||
| Income | Cost | Income | Cost | |
| Main business | 1,199,257,200.97 | 964,480,180.21 | 1,385,429,784.95 | 1,055,781,224.98 |
| Other businesses | 52,350,863.45 | 5,890,231.85 | 40,461,162.04 | 10,284,745.58 |
| Total | 1,251,608,064.42 | 970,370,412.06 | 1,425,890,946.99 | 1,066,065,970.56 |
Income information:
单位：元
| Contract type | Curtain wall | Railway transport | Real estate | New energy | Others | Total |
| Product type | 841,699,185.33 | 333,462,675.90 | 58,349,363.38 | 9,727,737.59 | 8,369,102.22 | 1,251,608,064.42 |
| Including: curtain wall system and materials | 841,699,185.33 | 841,699,185.33 | ||||
| Subway screen door and services | 333,462,675.90 | 333,462,675.90 | ||||
| Real estate sales | 58,349,363.38 | 58,349,363.38 |
| PV power generation products | 9,727,737.59 | 9,727,737.59 | ||||
| Other | 8,369,102.22 | 8,369,102.22 | ||||
| Total | 841,699,185.33 | 333,462,675.90 | 58,349,363.38 | 9,727,737.59 | 8,369,102.22 | 1,251,608,064.42 |
Information related to performance obligations:
The two businesses of the company's curtain wall system and materials, subway screen doors and services are mainly the contractscorresponding to the engineering projects. Usually, a contract constitutes a single performance obligation and is a performanceobligation performed within a certain period of time. The company recognizes revenue according to the performance progress.The sales of photovoltaic power generation products and real estate belong to contracts corresponding to commodity sales. Usually, acontract constitutes a single performance obligation and is a performance obligation at a certain point in time. Revenue is recognizedwhen the customer obtains control of the relevant product.Information related to the transaction price allocated to the remaining performance obligations:
The amount of revenue corresponding to the performance obligations that have been signed, but not yet performed or not yetperformed at the end of the reporting period is 4,367,812,121.53 yuan, of which 1,760,900,149.38 yuan is expected to be recognizedin 2020, and 1,817,152,403.45 yuan is expected to be recognized in 2021, 789,759,568.70 yuan It is expected that revenue will berecognized in 2022 and beyond.The Company must comply with disclosure requirements of the Shenzhen Stock Exchange Industry Information DisclosureGuideline No.3 – Listed Companies Engaged in Property Development.Top-5 projects in terms of income received and recognized in the reporting period: None
43. Taxes and surcharges
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| City maintenance and construction tax | 2,385,728.64 | 3,306,190.50 |
| Education surtax | 1,686,251.96 | 2,197,616.65 |
| Property tax | 2,227,891.98 | 2,367,178.99 |
| Land using tax | 684,461.08 | 772,262.35 |
| Vehicle usage tax | 9,780.00 | 15,960.00 |
| Stamp tax | 473,893.06 | 945,391.73 |
| Land VAT | 31,689,811.56 | |
| Others | 58,508.26 | 186,588.29 |
| Total | 7,526,514.98 | 41,481,000.07 |
44. Sales expense
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| Labor costs | 10,756,603.46 | 13,756,507.19 |
| Freight and miscellaneous charges | 3,781,184.56 | 2,552,065.93 |
| Travel expense | 487,521.11 | 684,332.50 |
| Entertainment expense | 871,505.28 | 979,949.90 |
| Material consumption | 490,460.47 | 135,028.48 |
| Office costs | 262,176.26 | 48,247.56 |
| Rental | 1,105,257.44 | 952,964.78 |
| Advertisement and promotion fee | 934,902.84 | 865,854.97 |
| Sales agency fee | 1,726,247.64 | 5,943,528.83 |
| Others | 562,376.03 | 1,257,158.36 |
| Total | 20,978,235.09 | 27,175,638.50 |
45. Management expenses
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| Labor costs | 38,668,384.40 | 47,235,320.97 |
| Depreciation and amortization | 4,117,481.73 | 4,810,846.91 |
| Agencies | 5,871,925.65 | 4,403,164.17 |
| Maintenance costs | 2,003,855.95 | 7,845,937.09 |
| Water and electricity | 100,825.03 | 351,795.21 |
| Office expense | 4,386,275.49 | 1,263,021.34 |
| Travel expense | 661,807.94 | 993,288.82 |
| Entertainment expense | 1,483,128.99 | 1,676,576.80 |
| Rental | 1,146,766.83 | 752,831.06 |
| Lawsuit | 274,438.54 | 337,101.22 |
| Material consumption | 161,161.21 | 145,197.52 |
| Property management fee | 375,160.71 | 666,254.99 |
| Others | 3,308,250.69 | 12,197,441.46 |
| Total | 62,559,463.16 | 82,678,777.56 |
46. R&D cost
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| Labor costs | 28,410,847.77 | 9,107,318.28 |
| Material costs | 17,682,878.47 | 1,605,931.43 |
| Rental | 992,251.86 | 938,339.52 |
| Depreciation costs | 734,440.47 | 304,783.16 |
| Amortization of intangible assets | 578,107.24 | 41,402.02 |
| Travel expense | 34,950.20 | 43,113.02 |
| Maintenance costs | 426,989.21 | 44,792.26 |
| Test and experiment costs | 1,869,321.47 | 2,141,801.56 |
| Patent maintenance costs | 229,952.90 | 299,269.18 |
| Others | 639,571.28 | 175,922.69 |
| Total | 51,599,310.87 | 14,702,673.12 |
47. Financial expenses
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| Interest expense | 46,974,588.65 | 41,338,886.48 |
| Less: interest capitalization | 3,809,610.82 | |
| Less: discount government subsidies | 862,000.00 | |
| Less: Interest income | 6,952,304.21 | 2,439,090.91 |
| Acceptant discount | 6,049,511.72 | 8,563,237.66 |
| Exchange gain/loss | -311,399.26 | 99,040.10 |
| Commission charges and others | 2,933,782.63 | 2,781,267.03 |
| Total | 44,884,568.71 | 49,481,340.36 |
48. Other gains
In RMB
| Source | Amount occurred in the current period | Occurred in previous period |
| VAT rebated | 2,649,784.42 | 1,359,044.12 |
| Energy saving subsidy | 980,000.00 | |
| R&D subsidy | 789,252.16 | 696,000.00 |
| Income tax and commission rebate | 477,506.39 | 1,395.63 |
| VAT, income tax rebate | 260,464.56 | 95,000.00 |
| Job stabilization, pre-job training subsidies, unemployment insurance premium refund | 400,564.26 | 12,400.00 |
| Innovation award | 130,500.00 | 36,500.00 |
| Nanshan District independent innovation industry development special fund | 14,500.00 | 500,000.00 |
| Science and Technology Commission innovation coupon | 34,980.00 | 130,040.00 |
| Self-breathing dual-layer hallow grass energy-saving curtain wall development project | 61,993.62 | 61,993.62 |
| Childbearing subsidy | 45,932.33 | 112,877.76 |
| Integration sponsorship | 200,000.00 | |
| Enterprise innovation ability cultivation and support | 508,000.00 | |
| 2018 Shenzhen standard allowance | 102,000.00 | |
| Hi-tech enterprise award | 100,000.00 | |
| Others | 368,635.03 | 86,199.38 |
| Total | 6,214,112.77 | 4,001,450.51 |
49. Investment income
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| Gains from long-term equity investment measured by equity | -375,202.09 | -325,733.55 |
| Investment income of trading financial assets during the holding period | 17,359,985.03 | |
| Investment income from disposal of trading financial assets | -16,598,749.99 | |
| Investment gain of financial products | 2,226,413.78 | 4,003,332.19 |
| Others | -309,081.13 | -382,436.52 |
| Financial assets derecognised as a result of amortized cost | -2,255,794.10 | |
| Total | -713,663.54 | 4,056,397.16 |
50. Income from fair value fluctuation
In RMB
| Source of income from fluctuation of fair | Amount occurred in the current period | Occurred in previous period |
| value | ||
| Transactional financial assets | 121,506.67 | |
| Gains from changes in fair value of other non-current financial assets | 9,107.28 | |
| Total | 9,107.28 | 121,506.67 |
51. Credit impairment loss
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| Bad debt loss of other receivables | -658,154.43 | 7,114,165.08 |
| Contract asset impairment loss | 50,624,553.37 | |
| Bad debt loss of account receivable | 24,887,786.32 | -11,483,825.46 |
| Total | 74,854,185.26 | -4,369,660.38 |
52. Assets impairment loss
None
53. Assets disposal gains
In RMB
| Source | Amount occurred in the current period | Occurred in previous period |
| Gain and loss from disposal of fixed assets ("-" for loss) | -1,981.72 | -27,108.78 |
54. Non-business income
In RMB
| Item | Amount occurred in the current period | Occurred in previous period | Amount accounted into the current accidental gain/loss |
| Penalty income | 172,413.23 | 401,931.00 | 172,413.23 |
| Compensation received | 4,740.00 | 4,378,501.74 | 4,740.00 |
| Payable account not able to be paid | 1,350.91 | ||
| Others | 98,688.41 | 92,108.50 | 98,688.41 |
| Total | 275,841.64 | 4,873,892.15 | 275,841.64 |
55. Non-business expenses
In RMB
| Item | Amount occurred in the current period | Occurred in previous period | Amount accounted into the current accidental gain/loss |
| Donation | 5,113,500.00 | 122,000.00 | 5,113,500.00 |
| Loss from retirement os damaged non-current assets | 123,770.81 | 30,871.84 | 123,770.81 |
| Penalty and overdue fine | 3,731.07 | 81,936.95 | 3,731.07 |
| Lawsuit indemnity | 143,641.00 | ||
| Others | 34,866.45 | 116.01 | 34,866.45 |
| Total | 5,275,868.33 | 378,565.80 | 5,275,868.33 |
56. Income tax expenses
(1) Details about income tax expense
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| Income tax expenses in this period | 16,583,321.25 | 26,190,753.94 |
| Deferred income tax expenses | 5,659,613.66 | -2,171,494.23 |
| Total | 22,242,934.91 | 24,019,259.71 |
(2) Adjustment process of accounting profit and income tax expense
In RMB
| Item | Amount occurred in the current period |
| Total profit | 169,051,292.91 |
| Income tax expenses calculated based on the legal (or applicable) tax rates | 42,262,823.23 |
| Impacts of different tax rates applicable for some subsidiaries | -18,604,275.19 |
| Impacts of income tax before adjustment | 694,341.23 |
| Impacts of non-deductible cost, expense and loss | 613,345.12 |
| Impacts of using deductible loss of unrecognized deferred income tax assets | -310,329.56 |
| Deductible temporary difference and deductible loss of unrecognized deferred income tax assets | 43,276.68 |
| Profit and loss of associates and joint ventures calculated using | 93,800.52 |
| the equity method | |
| Taxation impact of R&D expense and (presented with ―-‖) | -2,350,314.46 |
| Others | -199,732.65 |
| Income tax expenses | 22,242,934.91 |
57. Other miscellaneous income
See Note VII 39.
58. Notes to the cash flow statement
(1) Other cash inflow related to operation
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| Interest income | 3,906,753.15 | 901,193.29 |
| Subsidy income | 2,673,142.53 | 3,590,774.08 |
| Retrieving of bidding deposits | 194,487,618.44 | 37,655,725.50 |
| Other operating accounts | 12,873,603.24 | 5,860,054.56 |
| Total | 213,941,117.36 | 48,007,747.43 |
(2) Other cash paid related to operation
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| Administrative expense | 16,423,062.55 | 20,255,645.25 |
| Sales expense | 2,130,843.46 | 11,139,215.49 |
| Bidding deposit paid | 49,915,102.62 | 109,314,906.03 |
| Net draft deposit net paid | 129,561,924.62 | 161,663,318.36 |
| Lawsuit freezing funds | 61,699,121.88 | |
| Other trades | 16,953,229.98 | 4,842,346.84 |
| Total | 276,683,285.11 | 307,215,431.97 |
(3) Other cash received related to investment activities
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| Other investment-related cash received | 250.00 |
| Total | 250.00 |
(4) Other cash received related to financing
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| B-share repurchase restricted funds recovery | 39,406.61 | |
| Total | 39,406.61 |
(5) Other cash paid related to financing activities
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| Bill of exchange discounted loan margin | 181,300,000.00 | 40,000,000.00 |
| B share repurchase expenses | 99,998,965.99 | |
| Total | 281,298,965.99 | 40,000,000.00 |
59. Supplementary data of cash flow statement
(1) Supplementary data of cash flow statement
In RMB
| Supplementary information | Amount of the Current Term | Amount of the Previous Term |
| 1. Net profit adjusted to cash flow related to business operations: | -- | -- |
| Net profit | 146,808,358.00 | 128,564,198.64 |
| Plus: Asset impairment provision | -74,854,185.26 | -4,369,660.38 |
| Fixed asset depreciation, gas and petrol depreciation, production goods depreciation | 11,798,105.97 | 11,883,064.96 |
| Amortization of intangible assets | 2,117,631.57 | 1,762,127.14 |
| Amortization of long-term amortizable expenses | 609,394.73 | 216,264.82 |
| Loss from disposal of fixed assets, intangible assets, and other long-term assets (―-― for gains) | 1,981.72 | 27,108.78 |
| Loss from fixed asset discard (―-― for gains) | 123,770.81 | 30,871.84 |
| Loss from fair value fluctuation (―-― for gains) | -9,107.28 | -121,506.67 |
| Financial expenses (―-― for gains) | 49,214,489.55 | 49,040,124.14 |
| Investment losses (―-― for gains) | -1,542,130.56 | -4,056,397.16 |
| Decrease of deferred income tax asset (―-― for increase) | 10,311,829.50 | -3,881,562.85 |
| Increase of deferred income tax asset (―-― for increase) | -4,365,349.25 | 1,956,533.62 |
| Decrease of inventory (―-― for increase) | -46,192,352.00 | 33,483,787.38 |
| Decrease of operational receivable items (―-― for increase) | -135,629,210.99 | -164,044,489.43 |
| Increase of operational receivable items (―-― for decrease) | -267,716,203.34 | -351,001,350.74 |
| Others | 172,337,497.43 | -72,214,117.20 |
| Cash flow generated by business operations, net | -136,985,479.40 | -372,725,003.11 |
| 2 Major investment and financing activities with no cash involved: | -- | -- |
| 3. Net change in cash and cash equivalents: | -- | -- |
| Balance of cash at period end | 612,161,390.04 | 380,145,526.85 |
| Less: Initial balance of cash | 725,269,902.90 | 956,190,890.68 |
| Net increase in cash and cash equivalents | -113,108,512.86 | -576,045,363.83 |
(2) Composition of cash and cash equivalents
In RMB
| Item | Closing balance | Opening balance |
| I. Cash | 612,161,390.04 | 725,269,902.90 |
| Including: Cash in stock | 9,534.72 | 4,244.86 |
| Bank savings can be used at any time | 604,613,893.63 | 725,255,753.53 |
| Other monetary capital can be used at any time | 7,537,961.69 | 9,904.51 |
| III. Balance of cash and cash equivalents at end of term | 612,161,390.04 | 725,269,902.90 |
60. Assets with restricted ownership or use rights
In RMB
| Item | Closing book value | Reason |
| Monetary capital | 444,757,864.32 | Margin, litigation freezing, etc. |
| Inventory | 99,936,207.50 | Loan by pledge |
| Fixed assets | 64,242,861.97 | Loan by pledge |
| Intangible assets | 19,990,230.04 | Loan by pledge |
| 100% stake in Fangda Property Development held by the Company | 200,000,000.00 | Loan by pledge |
| Investment real estate | 2,803,546,306.33 | Loan by pledge |
| Other current assets | 201,790,136.99 | Pledge financing |
| Construction in process | 31,053,433.16 | Loan by pledge |
| Total | 3,865,317,040.31 | -- |
61. Foreign currency monetary items
(1) Foreign currency monetary items
In RMB
| Item | Closing foreign currency balance | Exchange rate | Closing RMB balance |
| Monetary capital | -- | -- | 43,153,012.17 |
| Including: USD | 1,061,677.02 | 7.079500 | 7,516,142.46 |
| HK Dollar | 31,198,423.57 | 0.913440 | 28,497,888.03 |
| INR | 16,235,911.99 | 0.093762 | 1,522,311.58 |
| Vietnamese currency | 3,145,709,253.00 | 0.000305 | 959,709.02 |
| AUD | 957,099.92 | 4.865700 | 4,656,961.08 |
| Account receivable | -- | -- | 61,443,643.71 |
| Including: USD | 6,232,954.47 | 7.079500 | 44,126,201.17 |
| HK Dollar | 2,962,103.66 | 0.913440 | 2,705,703.97 |
| INR | 13,081,350.14 | 0.093762 | 1,226,533.55 |
| AUD | 2,750,931.01 | 4.865700 | 13,385,205.02 |
| Other receivables | 1,575,019.38 | ||
| Including: USD | 58,390.31 | 7.079500 | 413,374.20 |
| HK Dollar | 272,985.00 | 0.913440 | 249,355.42 |
| INR | 9,205,454.91 | 0.093762 | 863,121.86 |
| AUD | 10,105.00 | 4.865700 | 49,167.90 |
| Short-term loans | 46,253,410.00 | ||
| Including: Euro | 5,810,000.00 | 7.961000 | 46,253,410.00 |
| Other payables | 342,772.67 | ||
| Including: USD | 12,490.78 | 7.079500 | 88,428.48 |
| HK Dollar | 255,721.28 | 0.913440 | 233,586.04 |
| AUD | 4,266.22 | 4.865700 | 20,758.15 |
| Contract assets | 4,239,028.59 | ||
| Including: USD | 571,545.98 | 7.079500 | 4,046,259.77 |
| AUD | 39,617.90 | 4.865700 | 192,768.82 |
| Contract liabilities | 624,314.20 | ||
| Including: USD | 88,186.20 | 7.079500 | 624,314.20 |
(2) The note of overseas operating entities should include the main operation places, book keepingcurrencies and selection basis. Where the book keeping currency is changed, the reason should also beexplained.
□ Applicable √ Inapplicable
62. Hedging
Hedging items and related tools, qualitative and quantitative information about hedging risks:
| Type | Hedged item | Hedging tools | Hedged risk |
| Cash flow hedging | Forward transaction of aluminum sheet purchase; Forward foreign exchange transactions | Aluminum futures contract; Forward foreign exchange contract | The price of raw materials has risen, leading to an increase in expected transaction procurement costs; Foreign currency depreciation, resulting in a decrease in actual receipts |
63. Government subsidy
(1) Government subsidy profiles
In RMB
| Type | Amount | Item | Amount accounted into the current gain/loss |
| Major investment project prize from Industry and Trade Development Division of Dongguan Finance Bureau | 1,623,809.90 | Deferred earning | 28,571.40 |
| Distributed PV power generation project subsidy sponsored by Dongguan Reform and Development Commission | 393,750.17 | Deferred earning | 12,499.98 |
| Subsidized land transfer | 177,278.87 | Deferred earning | 1,862.82 |
| Special subsidy for industrial transformation, upgrading and development | 800,000.00 | Deferred earning | 20,000.01 |
| National Industry Revitalization and Technology Renovation Project fund | 7,276,754.61 | Deferred earning | 61,993.62 |
| Enterprise informationization subsidy project of Shenzhen Small and Medium Enterprise Service Agency | 468,000.00 | Deferred earning | 24,000.00 |
| Shenzhen Science and Technology Innovation Committee Technology Innovation Subsidy | 200,000.00 | Deferred earning | 34,980.00 |
| Railway transport screen door controlling system and information transmission technology subsidy | 77,653.85 | Deferred earning | 9,452.16 |
| VAT rebated into revenue | 2,649,784.42 | Other gains | 2,649,784.42 |
| Subsidies for demonstration projects supported by building energy conservation development funds | 980,000.00 | Other gains | 980,000.00 |
| Income tax commission | 477,506.39 | Other gains | 477,506.39 |
| Shenzhen Science and Technology Innovation Committee enterprise R&D funding | 379,000.00 | Other gains | 379,000.00 |
| Nanchang High-tech Industrial Development Zone Management Committee Science and Technology Bureau R&D expense subsidy | 350,000.00 | Other gains | 350,000.00 |
| VAT, income tax rebate | 260,464.56 | Other gains | 260,464.56 |
| Employment subsidy | 227,517.31 | Other gains | 227,517.31 |
| Others | 696,480.10 | Other gains | 696,480.10 |
| Total | 17,038,000.18 | 6,214,112.77 |
(2) Government subsidy refund
□ Applicable √ Inapplicable
VIII. Change to Consolidation Scope
1. Change to the consolidation scope for other reasons
1. In this period, two subsidiaries directly controlled namely Fangda Qingling and Fangda Cloud Track Company were newlyestablished and two subsidiaries were added in the current consolidated statement;IX. Equity in Other Entities
1. Interests in subsidiaries
(1) Group Composition
| Company | Place of business | Registered address | Business | Shareholding percentage | Obtaining method | |
| Direct | Indirect | |||||
| Fangda Jianke | Shenzhen | Shenzhen | Designing, manufacturing, and installation of curtain walls | 98.39% | 1.61% | Incorporation |
| Fangda Zhichuang | Shenzhen | Shenzhen | Production, processing and installation of subway screen doors | 51.00% | 49.00% | Incorporation |
| Fangda New Material | Nanchang | Nanchang | Prodution and sales of new-type materialsm composite materials and production of curtain walls | 75.00% | 25.00% | Incorporation |
| Fangda Property | Shenzhen | Shenzhen | Real estate development and operation | 100.00% | Incorporation | |
| Fangda New Energy | Shenzhen | Shenzhen | Design and construction of PV power plants | 99.00% | 1.00% | Incorporation |
| Chengdu Fangda | Chengdu | Chengdu | Trusted processing of building curtain wall materials | 100.00% | Incorporation | |
| Shihui International | Virgin Islands | Virgin Islands | Investment | 100.00% | Incorporation | |
| Dongguan New Material | Dongguan | Dongguan | Installation and sales of building curtain walls | 100.00% | Incorporation | |
| Fangda Property Management | Shenzhen | Shenzhen | Property management | 100.00% | Incorporation | |
| Jiangxi Property Development | Nanchang | Nanchang | Real estate development and operation | 100.00% | Incorporation | |
| Luxin New Energy | Pingxiang | Pingxiang | Design and construction of PV power plants | 100.00% | Incorporation | |
| Xinjian New Energy | Nanchang | Nanchang | Design and construction of PV power plants | 100.00% | Incorporation | |
| Dongguan New Energy | Dongguan | Dongguan | Design and construction of PV power plants | 100.00% | Incorporation | |
| Kechuangyuan Software | Shenzhen | Shenzhen | Software development | 100.00% | Incorporation | |
| Zhichuang Technology Hong Kong | Hong Kong | Hong Kong | Metro screen door | 100.00% | Incorporation | |
| Hongjun Investment Company | Shenzhen | Shenzhen | Investment | 98.00% | 2.00% | Incorporation |
| Fangda Australia Co., Ltd. | Australia | Australia | Designing, manufacturing, and installation of curtain walls | 100.00% | Incorporation | |
| Fang Qingling | Shanghai | Shanghai | Intelligent technology, new | 30.00% | 70.00% | Incorporation |
| energy, automated technology | ||||||
| Fangda Cloud Rail | Shenzhen | Shenzhen | Design, development and sales of cloud rail transport equipment | 100.00% | Incorporation | |
| Chengda Curtain Wall Company | Chengdu | Chengdu | Building decoration and other construction industry | 100.00% | Incorporation | |
| Fangda Southeast Asia | Vietnam | Vietnam | Designing, manufacturing, and installation of curtain walls | 100.00% | Incorporation | |
| Fangda Jianzhi | Shanghai | Shanghai | Construction technology, intelligent technology, automation technology, design, production and installation of building curtain walls | 100.00% | Incorporation | |
| Zhongrong Litai | Shenzhen | Shenzhen | Business service | 55.00% | Purchase | |
| Jianke Hong Kong | Hong Kong | Hong Kong | Designing, manufacturing, and installation of curtain walls | 100.00% | Incorporation |
Others:
Jianke Hong Kong Company has a registered capital of 40,000.00 Hong Kong dollars, and Shihui International Company paid up itscapital on May 19, 2020.
(2) Major non wholly-owned subsidiaries
In RMB
| Company | Shareholding of minority shareholders | Profit and loss attributed to minority shareholders | Dividend to be distributed to minority shareholders | Interest balance of minority shareholders in the end of the period |
| Zhongrong Litai | 45.00% | -31,526.57 | 48,378,483.03 |
(3) Financial highlights of major non wholly owned subsidiaries
In RMB
| Company | Closing balance | Opening balance | ||||||||||
| Current asset | Non-current assets | Total of assets | Current liabilities | Non-current liabilities | Total liabilities | Current asset | Non-current assets | Total of assets | Current liabilities | Non-current liabilities | Total liabilities | |
| Zhongrong Litai | 205,490,834.99 | 30,064.06 | 205,520,899.05 | 98,013,158.99 | 98,013,158.99 | 174,827,165.52 | 30,066.12 | 174,857,231.64 | 67,279,432.54 | 67,279,432.54 | ||
In RMB
| Company | Amount occurred in the current period | Occurred in previous period | ||||||
| Turnover | Net profit | Total of misc. incomes | Business operation cash flows | Turnover | Net profit | Total of misc. incomes | Business operation cash flows | |
| Zhongrong Litai | 229,334.85 | -70,059.04 | -70,059.04 | -11,053.19 | -143,071.56 | -143,071.56 | 19.69 | |
2. Interests in joint ventures or associates
(1) Financial summary of insignificant joint ventures and associates
In RMB
| Closing balance/amount occurred in this period | Opening balance/amount occurred in previous period | |
| Associate: | -- | -- |
| Total book value of investment | 56,847,038.74 | 57,222,240.83 |
| Total shareholding | -- | -- |
| Net profit | -375,202.09 | -325,733.55 |
| Total of misc. incomes | -375,202.09 | -325,733.55 |
X. Risks of Financial ToolsThe risks associated with the financial instruments of the Company arise from the various financial assets and liabilitiesrecognized by the Company in the course of its operations, including credit risks, liquidity risks and market risks.
The management objectives and policies of various risks related to financial instruments are governed by the management ofthe company. The operating management is responsible for daily risk management through functional departments (for example, thecompany reviews the company's credit sales on a case-by-case basis). The internal audit department of the company conducts dailysupervision of the implementation of the company's risk management policies and procedures, and reports relevant findings to the
company's audit committee in a timely manner.
The overall goal of the company's risk management is to formulate risk management policies that minimize the risksassociated with various financial instruments without excessively affecting the company's competitiveness and resilience.
1. Credit risk
Credit risk is caused by the failure of one party of a financial instrument in performing its obligations, causing the risk offinancial loss for the other party. The credit risk of the company mainly arises from currency funds, receivables, receivables, contractassets, other receivables and long-term receivables. The credit risk of these financial assets is derived from the counterparty defaultand the maximum exposure is equal to the carrying amount of these instruments.
The company's money and funds are mainly deposited in the commercial banks and other financial institutions. The companybelieves that these commercial banks have higher reputation and asset status and have lower credit risk.
For receivables and contract assets, the Group sets up related policies to control the credit risk. The Group set the credit lineand term for debtors according to their financial status, external rating, and possibility of getting third-party guarantee, credit recordand other factors. The Group regularly monitors debtors’ credit record. For those with poor credit record, the Group will send writtenpayment reminders, shorten or cancel credit term to lower the general credit risk.
(1) Significant increases in credit risk
The credit risk of the financial instrument has not increased significantly since the initial confirmation. In determining whetherthe credit risk has increased significantly since the initial recognition, the Company considers reasonable and evidenced information,including forward-looking information, that can be obtained without unnecessary additional costs or effort. The Company determinesthe relative risk of default risk of the financial instrument by comparing the risk of default of the financial instrument on the balancesheet date with the risk of default on the initial recognition date to assess the credit risk of the financial instrument from initialrecognition.
When triggering one or more of the following quantitative and qualitative criteria, we believe that the credit risk of thefinancial instruments has increased significantly: The quantitative criterion is mainly that the probability of default in the remainingperiod of the reporting date has increased by more than a certain proportion from the initial confirmation; The qualitative criteria aresignificant adverse changes in the operation or financial situation of the principal debtor.
(2) Definition of assets where credit impairment has occurred
In order to determine whether or not credit impairment occurs, the standard adopted by our company is consistent with thecredit risk management target for related financial instruments, and quantitative and qualitative indicators are considered.
Major financial difficulties have occurred to the issuer or the debtor; Breach of contract by the debtor, such as payment ofinterest or default or overdue of principal; (B) The concession that the debtor would not make under any other circumstances foreconomic or contractual considerations relating to the financial difficulties of the debtor; The debtor is likely to be bankrupt orundertake other financial restructuring; The financial difficulties of the issuer or debtor lead to the disappearance of the active marketfor the financial asset; To purchase or generate a financial asset at a substantial discount, which reflects the fact that a credit loss hasoccurred.
Credit impairment in financial assets may be caused by a combination of multiple events, not necessarily by events that can beidentified separately.
(3) Expected credit loss measurement
Depending on whether there is a significant increase in credit risk and whether a credit impairment has occurred, the Companyprepares different assets for a 12-month or full expected credit loss. The key parameters of expected credit loss measurement include
default probability, default loss rate and default risk exposure. Taking into account the quantitative analysis and forward-lookinginformation of historical statistics (such as counterparty ratings, guaranty methods, collateral categories, repayment methods, etc.),the Company establishes the default probability, default loss rate and default risk exposure model.Definition:
The probability of default refers to the possibility that the debtor will not be able to fulfil its obligation to pay in the next 12months or throughout the remaining period.
Breach Loss Rate means the extent of loss expected by the Company for breach risk exposure. Depending on the type ofcounterparty, the manner and priority of recourse, and the different collateral, the default loss rate is also different. The default lossrate is the percentage of the risk exposure loss at the time of the default, calculated on the basis of the next 12 months or the entirelifetime.
Exposure to default is the amount payable to the Company at the time of default in the next 12 months or throughout theremaining life. Prospective information credit risks significantly increased and expected credit losses were calculated. Through theanalysis of historical data, the company has identified the key economic indexes that affect the credit risk of each business type andthe expected credit loss.
The largest credit risk facing the Group is the book value of each financial asset on the balance sheet. The Group makes noguarantee that may cause the Group credit risks.
Among the Group’s receivables and contract assets, accounts receivable and contract assets from top 5 customers account for
21.76% of the total accounts receivable (2019: 17.66%); among other receivables, other receivables from top 5 customers account for
66.38% of the total other receivables (2019: 71.29%).
2. Liquidity risk
Liquidity risk is the risk of capital shortage when the Group needs to pay cash or settled with other financial assets. Thecompany is responsible for the cash management of its subsidiaries, including short-term investments in cash surpluses and loans tomeet projected cash requirements. The company's policy is to regularly monitor short and long-term liquidity requirements andcompliance with borrowing agreements to ensure adequate cash reserves and readily available securities.The maturity period of the company's financial liabilities at the end of the period is as follows:
Contract amount: RMB
| Item | 30 June 2020 | |||
| Less than 1 year | Within 1-3 years | Over 3 years | Total | |
| Short-term loans | 128,063.57 | 128,063.57 | ||
| Notes payable | 53,147.84 | 53,147.84 |
| Account payable | 107,744.79 | 1,999.77 | 915.19 | 110,659.75 |
| Employees' wage payable | 2,459.35 | 2,459.35 | ||
| Other payables | 62,815.19 | 2,222.97 | 6,186.23 | 71,224.39 |
| Non-current liabilities due in 1 year | 15,161.78 | 15,161.78 | ||
| Other current liabilities | 5,954.40 | 76.93 | 98.52 | 6,129.85 |
| Long-term loans | 0.00 | 24,991.15 | 90,125.00 | 115,116.15 |
| Total liabilities | 375,346.92 | 29,290.82 | 97,324.94 | 501,962.68 |
The expiry period of the company's financial liabilities is as follows:
Contract amount: RMB
| Item | 31 December 2019 | |||
| Less than 1 year | Within 1-3 years | Over 3 years | Total | |
| Short-term loans | 72,461.82 | - | - | 72,461.82 |
| Notes payable | 57,881.60 | - | - | 57,881.60 |
| Account payable | 118,979.57 | 0.97 | 96.79 | 119,077.33 |
| Employees' wage payable | 5,584.71 | - | - | 5,584.71 |
| Other payables | 68,410.66 | 1,170.99 | 561.59 | 70,143.24 |
| Non-current liabilities due in 1 year | 92,234.66 | - | - | 92,234.66 |
| Other current liabilities | 18,169.46 | - | - | 18,169.46 |
| Long-term loans | - | 39,650.15 | 15,000.00 | 54,650.15 |
| Total liabilities | 433,722.48 | 40,822.11 | 15,658.38 | 490,202.97 |
3. Market risks and measures
(1) Credit risks
The exchange rate risk of the company mainly comes from the assets and liabilities of the company and its subsidiaries inforeign currency not denominated in its functional currency. Except for the use of Hong Kong dollars, United States dollars,Australian dollars, Vietnamese shields, Indian rupees or Singapore currencies by its subsidiaries established in and outside the HongKong Special Administrative Region, other major businesses of the Company shall be denominated in Renminbi.
As of June 30, 2020, the foreign currency financial assets and foreign currency financial liabilities of the company at the endof the period are listed in the description of foreign currency monetary items in section VII. 61.
The company pays close attention to the impact of exchange rate changes on the company's exchange rate risk. The companycontinuously monitors the scale of foreign currency transactions and foreign currency assets and liabilities to minimize foreignexchange risks. To this end, the Company may avoid foreign exchange risks by signing forward foreign exchange contracts orcurrency swap contracts.
(2) Exchange rate risk
The Group's interest rate risk mainly arises from long-term interest-bearing debts such as long-term bank loans. Financialliabilities with floating interest rate cause cash flow interest rate risk for the Group. Financial liabilities with fixed interest rate causefair value interest rate risk for the Group. The Group decides the proportion between fixed interest rate and floating interest rateaccording to the market environment and regularly reviews and monitors the combination of fixed and floating interest rateinstruments.
The company's finance department continuously monitors the company's interest rate level. The rising interest rate willincrease the cost of the new interest-bearing debt and the interest expenditure on interest-bearing debt which has not yet been paid bythe company at the floating rate, and will have a significant adverse effect on the company's financial performance. Management willmake adjustments in time according to the latest market conditions.
As of June 30, 2020, the current floating interest rate borrowings of 2.049 billion yuan, while other risk variables remainunchanged, if the borrowing rate calculated at the floating interest rate rises or falls by 50 basis points, the company's net profit forthe year will be Will decrease or increase 7,685,300 yuan.
XI. Fair Value
1. Closing fair value of assets and liabilities measured at fair value
In RMB
| Item | Closing fair value | |||
| First level fair value | Second level fair value | Third level fair value | Total | |
| 1. Continuous fair value measurement | -- | -- | -- | -- |
| (1) Transactional financial assets | 1,815,676.34 | 18,005,336.72 | 19,821,013.06 | |
| 1. Financial assets measured at fair value with variations accounted into current income account | 1,815,676.34 | 18,005,336.72 | 19,821,013.06 | |
| (1) Investment in equity tools | 18,005,336.72 | 18,005,336.72 | ||
| (2) Derivative financial assets | 1,815,676.34 | 1,815,676.34 | ||
| (2) Receivable financing | 300,000.00 | 300,000.00 | ||
| (3) Investment in other equity tools | 20,140,037.85 | 20,140,037.85 | ||
| (4) Investment real estate | 5,517,829,915.07 | 5,517,829,915.07 | ||
| 1. Leased building | 5,517,829,915.07 | 5,517,829,915.07 | ||
| (5) Other non-current financial assets | 5,018,835.30 | 5,018,835.30 | ||
| Total assets measured at fair value continuously | 1,815,676.34 | 5,517,829,915.07 | 43,464,209.87 | 5,563,109,801.28 |
2. Recognition basis of market value of continuous and discontinuous items measured at first level fairvalueThe Group determines the fair value using quotation in an active market for financial instruments traded in an active market;
3. Valuation technique and qualitative and quantitative information for key parameters of continuous anddiscontinuous second level fair value itemsFor investment in real estate similar with real estate transaction, the Group uses valuation techniques to determine its fair value. Thetechnique is comparison and earning method. Inputs include transaction date, status, region and other factors.
4. Valuation technique and qualitative and quantitative information for key parameters of continuous anddiscontinuous third level fair value itemsIf there is no active market, the Company uses evaluation techniques to determine the fair value. The valuation models are mainlycash flow discount model and market comparable company model. The input value of valuation technology mainly includes risk-freeinterest rate, benchmark interest rate, exchange rate, credit point difference, liquidity premium, lack of liquidity discount, etc.
5. Switch between different levels, switch reason and switching time policy
The company takes the occurrence date of the events leading to the transition between levels as the time point to confirm thetransition between levels. In the period, there is no switch in the financial assets measured at fair value between the first and secondlevel or transfer in or out of the third level.
6. Fair value of financial assets and liabilities not measured at fair value
Financial assets and liabilities measured at amortized cost include: monetary capital, bills receivable, accounts receivable, otherreceivables, short-term borrowings, notes payable, accounts payables, other payables, and long-term payables.The difference between book value and fair value of financial assets and liabilities not measured at fair value is small.XII. Related Parties and Transactions
1. Parent of the Company
| Parent | Registered address | Business | Registered capital (in RMB10,000) | Share of the parent co. in the Company | Voting power of the parent company |
| Shenzhen Banglin Technologies Development Co., Ltd. | Shenzhen | Industrial investment | 3,000.00 | 10.55% | 10.55% |
| Shengjiu Investment Ltd. | Hong Kong | Industrial investment | HKD1.00 | 9.57% | 9.57% |
Particulars about the parent of the Company
(1) All of the investors of Shenzhen Banglin Technology Development Co., Ltd., the holding shareholder of the Company, are naturalpersons. Among them, Chairman Xiong Jianming is holding 85％ shares, and Mr. Xiong Xi – son of Mr. Xiong Jianming, is holding15% of the shares.
(2) Among the top 10 shareholders, Shenzhen Banglin Technology Development Co., Ltd. and Shengjiu Investment Co., Ltd. areacting in concert. The Company is not notified of other action-in-concert or related parties among the other holders of current shares.The final controller of the Company is Xiong Jianming.
2. Subsidiaries of the Company
For details of the company’s subsidiaries, please refer to Section IX. 1. Equity in subsidiaries.
3. Joint ventures and associates
For the important joint ventures or joint ventures of this enterprise, please refer to section IX. 2. Rights and interests in joint venturearrangements or joint ventures.Information about other joint ventures or associates with related transactions in this period or with balance generated by relatedtransactions in previous period:
| Joint venture or associate | Relationship with the Company |
| Shenzhen Ganshang Joint Investment Co., Ltd. (Shenzhen Ganshang) | Associate |
4. Other associates
| Other related parties | Relationship with the Company |
| Ganshang Joint Investment | Associate |
| Jiangxi Business Innovative Property Joint Stock (Jiangxi Business Inovation) | Associate |
| Shenzhen Qijian Technology Co., Ltd. (Qijian Technology) | Common actual controller |
| Shenyang Fangda Semi-conductor Lighting Co., Ltd. (hereinafter Shenyang Fangda) | Subsidiary in liquidation |
| Shenzhen Woke Semi-conductor Lighting Co., Ltd. (hereinafter Shenzhen Woke) | Subsidiary in liquidation |
| Gong Qing Cheng Shi Li He Investment Management Partnership Enterprise (limited partner) | Affiliated relationship with Shenzhen Banglin Technology Development Co., Ltd. |
| Director, manager and secretary of the Board | Key management |
5. Related transactions
(1) Related transactions for purchase and sale of goods, provision and acceptance of servicesSales of goods and services
In RMB
| Affiliated party | Related transaction | Amount occurred in the current period | Occurred in previous period |
| Qijian Technology | Property service and sales of goods | 25,261.82 | 22,610.18 |
| Ganshang Joint Investment | Property service and sales of goods | 5,060.89 |
(2) Related leasing
The Company is the leasor:
In RMB
| Name of the leasee | Category of asset for lease | Rental recognized in the period | Rental recognized in the period |
| Qijian Technology | Houses & buildings | 207,366.00 | 207,366.00 |
| Ganshang Joint Investment | Houses & buildings | 66,475.80 |
(3) Related guarantees
The Company is the guarantor:
In RMB
| Beneficiary party | Amount guaranteed | Start date | Due date | Completed or not |
| Fangda Jianke | 300,000,000.00 | 28 August 2018 | 2020.07.31 | No |
| Fangda Jianke | 100,000,000.00 | 21 June 2019 | 2020.06.20 | No |
| Fangda Property | 1,350,000,000.00 | 25 February 2020 | 24 February 2020 | No |
| Fangda Jianke | 250,000,000.00 | 20 August 2019 | 2020.08.19 | No |
| Fangda Jianke | 600,000,000.00 | 24 February 2020 | 13 February 2021 | No |
| Fangda Jianke | 300,000,000.00 | 1 August 2019 | 2020.07.31 | No |
| Fangda Jianke | 400,000,000.00 | 17 April 2019 | 2020.04.17 | No |
| Fangda Zhichuang | 216,000,000.00 | 6 August 2018 | 2020.07.12 | No |
| Fangda Zhichuang | 150,000,000.00 | 27 May 2019 | 2020.05.27 | No |
| Fangda Zhichuang | 200,000,000.00 | 16 June 2020 | 13 February 2021 | No |
| Fangda Zhichuang | 200,000,000.00 | 1 August 2019 | 2020.07.31 | No |
| Fangda Zhichuang | 30,000,000.00 | 29 June 2020 | 23 June 2020 | No |
| Fangda New Material | 65,000,000.00 | 23 May 2020 | 22 May 2021 | No |
| Fangda New Material | 80,000,000.00 | 24 April 2019 | 2020.04.23 | No |
| Fang Qingling | 80,000,000.00 | 10 July 2019 | 2024.07.10 | No |
| Jiangxi Property Development | 200,000,000.00 | 19 June 2019 | 2023.06.23 | No |
| Fangda Jianke and Fangda Zhichuang | 140,000,000.00 | 18 December 2019 | No | |
| Total | 4,661,000,000.00 |
The Company is the guarantied party:
In RMB
| Guarantor | Amount guaranteed | Start date | Due date | Completed or not |
| Fangda Jianke | 500,000,000.00 | 26 March 2019 | 2020.03.26 | No |
| Fangda Jianke, Fangda New Energy | 100,000,000.00 | 26 March 2019 | 2021.3.20 | No |
Note to related guarantees
1. The above-mentioned guarantees are all associated guarantees within interested entities of the Group.
2. HSBC has a total credit of RMB 90 million to the Company, Fangda Jianke and Fangda Zhichuang and has not yet agreed onthe credit expiration date. HSBC regularly evaluates the credit status. The restriction on the use of the credit is as follows:
The company can use non-financial bank guarantees of up to 90 million yuan to grant credit;
Fangda Jianke has non-committed combined revolving credits of not more than RMB90 million including revolving loans ofup to RMB90 million, non-financial bank guarantees of up to RMB90 million and bank acceptances of up to RMB90 million.
Fangda Jianke has non-committed combined revolving credits of not more than RMB140 million including revolving loans ofup to RMB50 million, non-financial bank guarantees of up to RMB140 million and bank acceptances of up to RMB140 million.
(3) Xingye Bank total credit to this company, Fangda Jianke company, Zhixin technology company 900 million yuan, of whichFangda Jianke company no more than 400 million yuan, Zhixin technology company no more than 12 million yuan, the company nomore than 600 million yuan.
(4) Remuneration of key management
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| Directors, supervisors and senior management | 3,921,960.54 | 4,251,796.50 |
6. Receivable and payables due with related parties
(1) Receivable interest
In RMB
| Project | Affiliated party | Closing balance | Opening balance | ||
| Remaining book value | Bad debt provision | Remaining book value | Bad debt provision | ||
| Account receivable | Qijian Technology | 1,230.45 | 10.58 | 1,212.89 | 12.13 |
| Other receivables | Shenyang Fangda | 42,877.00 | 42,877.00 | 42,877.00 | 42,877.00 |
| Other receivables | Shenzhen Woke | 867,442.94 | 867,442.94 | 867,442.94 | 867,442.94 |
| Other receivables | Ganshang Joint Investment | 5,015,089.25 | 74,724.83 | 5,015,089.25 | 74,724.83 |
XIII. Share Payment
1. Overall share payment
□ Applicable √ Inapplicable
2. Share payment settled by equity
□ Applicable √ Inapplicable
3. Share payment settled by cash
□ Applicable √ Inapplicable
4. Revising and termination of share payment
NoneXIV. Commitment and Contingent Events
1. Major commitments
Major commitments that exist on the balance sheet dayMajor commitments that exist on the balance sheet dayOn November 6, 2017, Fangda Real Estate Co., Ltd., a subsidiary of the Company, and Bangshen Electronics (Shenzhen) Co.,Ltd. signed the ―Joint Development Agreement on Fangda Bangshen Industrial Park (Temporary Name) Urban Renewal Project‖,and the two parties agreed to develop cooperatively. In order to develop urban renewing projects such as a ―renovation project‖,Fangda Real Estate provided Party A with property compensation through renovating and renovating the property allocation termsagreed upon by both parties, and obtained independent development rights of the project. As of June 30, 2020, Fangda Real EstateCo., Ltd. had paid a security deposit of RMB 20 million.
(2) In July 2018 ,the company's subsidiary Fangda Real Estate Co. Ltd. (Party A) signed a contract with Shenzhen Yikang RealEstate Co. Ltd. (Party B1) and Shenzhen Qianhai Zhongzheng Dingfeng No. 6 Investment Enterprise (Limited Partnership) (PartyB2), "Shenzhen Henggang Dakang Village Project Cooperation Agreement". Party B agrees to transfer the entire equity of the projectcompany it holds and the entire development interest of the project to Party A. Party A shall pay Party B a total of RMB600 millionfor the cooperation price. As of June 30, 2020, Fangda Real Estate Company had paid a deposit of RMB 50 million to Party B andthe project company, and had paid a service fee of RMB 20 million.As of June 30, 2020, the Group did not have other commitments that should be disclosed.
2. Contingencies
(1) Significant contingencies on the balance sheet date
(1) Contingent liabilities formed by material lawsuit or arbitration, and their influences on the financial position
Notes:
In November 2018， Fangda Jianke a subsidiary of the Group sued Fujian Huapu Real Estate Development Co. Ltd. for apayment of RMB 13810243.67 and its overdue interest payment of RMB 373,380.16 totaling RMB 14,183,623.83 to the TaijiangDistrict People's Court of Fuzhou City. On 10 May 2019, the court ruled against the prosecution; On 16 May 2019, Fang Da Jiankefiled an appeal; On 26 August 2019, the court of second instance ordered the court of first instance to revoke the first instancedecision; On 8 October 2019, it was sent back to the court of first instance, case number: (2019) Min 0103 Republic of China 4282.In April 2020, Huapu Company filed a counterclaim application to the court, requesting Fangda Jianke Company to pay a total of12,746,000.00 yuan for the construction period and quality. As of the date of this report, the two cases are still under trial and havenot yet been judged.
2. In December 2019, Fangda Construction Company sued the construction party Zhejiang Jiayue Industrial Co., Ltd. to thePeople's Court of Keqiao District, Shaoxing City for payment of 20,158,046.00 yuan for the construction of Shaoxing Jiayue Plaza
project, temporarily 4,660,400.00 yuan, return of performance bond 3,699,100.00 yuan, compensation for losses 2,144,400.00 yuan,a total of 30,661,946.00 yuan. Thereafter, Fang Da Jianke increased the number of claims, totalling 30,727,401.26 yuan. In March2020, Jiayue Company filed a counterclaim with the court, demanding Fangda Construction Company to pay a penalty of RMB369,899.98 for the construction period, RMB 13,529,427.00 for quality maintenance, and a compensation of RMB 22,193,998.74 forbreach of contract damages, deducting a performance bond of RMB 3,699,100.00, and a fine of RMB 52,500.00 for a total of39,844,925.72 yuan. The two parties separately initiated project cost appraisal and project quality appraisal. As of the date of thisreport, the two cases are still under trial and have not yet been judged.
3. Langfang Aomei Foundation Real Estate Development Co., Ltd. filed a lawsuit with the court on June 19, 2019, requestingFangda Construction Company to pay a total of 19,721,315.00 yuan for the construction period and quality penalty, and on December26, 2019, the quality, restoration cost and unfinished Project cost appraisal application; Fangda Jianke filed a counterclaim onSeptember 11, 2019, demanding that Aomei Company pay the total amount of 13,939,863.27 yuan for the construction cost,liquidated damages, and compensation losses. On November 22, 2019, it filed the completed project cost appraisal application. As ofthe date of this report, the case is still in the appraisal process.
4. Shenzhen Qianhai Guohong Mobile Information Technology Co., Ltd. filed a lawsuit with Shenzhen Nanshan DistrictPeople's Court in January 2020 to require Fangda Property to pay a total of RMB13,231,913.00 for breach of contract overduecertification. As of the reporting date, the case has not yet been judged.
5. Shenzhen Fangcheng Teaching Equipment Co., Ltd. filed a lawsuit with Shenzhen Nanshan District People's Court inFebruary 2020 to terminate the house purchase contract signed with Fangda Property, return the purchase price of RMB7,240,752.00,and pay the total amount of liquidated damages of RMB 10,203,715.00 for overdue certification. As of the reporting date, the casehas not yet been heard.
(2) Pending major lawsuits
On September 10 2018, the People's Court of Lixia District of Jinan City sentenced Shandong Zhonghong Real Estate Co. Ltd.to the Company for payment of 5960429.45 yuan within 10 days from the date of the effective date of the (2018) Lu 0102 Minchu5367 civil judgment. (2019) The Civil Judgment No. 1Lu01 Minchu 2023 ruled that Shandong Zhonghong Real Estate Co., Ltd. shallpay 18,804,914.46 yuan and interest to Fangda Construction Company within ten days from the effective date of the judgment, andenjoy the priority of compensation. As of the date of this report, Zhonghong Company has entered the bankruptcy liquidation stage.The company has declared the creditor's rights of the above two judgments and has not received the relevant funds.
(3) Contingent liabilities formed by providing of guarantee to other companies’ debts and their influences on financial situationAs of June 30, 2020, the Company provided guarantees for the following unit loans:
| Name of guaranteed entity | Guarantee | Amount (in RMB10,000) | Term |
| Fangda Property | Pledge/mortgage guarantee | 99,000.00 | 2020/3/13 to 2030/3/13 |
| Fangda Jianke | Guarantee | 5,000.00 | 2020/02/26 to 2021/01/31 |
| Fangda Jianke | Guarantee | 4,500.00 | 2020/05/20 to 2021/01/15 |
| Fangda Jianke | Guarantee | 5,000.00 | 2020/01/02 to 2021/01/02 |
| Fangda Zhichuang | Guarantee | 5,000.00 | 2020/02/26 to 2021/01/31 |
| Fangda Zhichuang | Guarantee | 1,600.00 | 2019/8/7 to 2020/8/6 |
| Fangda Zhichuang | Guarantee | 3,000.00 | 2020/06/29 to 2021/06/23 |
| Fangda Property | Warranty/mortgage guarantee | 2,500.00 | 2019/7/22 to 2023/7/22 |
| Fangda Property | Warranty/mortgage | 2,500.00 | 2019/9/12 to 2023/7/22 |
| guarantee | |||
| Fangda Property | Warranty/mortgage guarantee | 3,000.00 | 2019/9/26 to 2023/7/22 |
| Fangda Property | Warranty/mortgage guarantee | 2,000.00 | 2019/9/29 to 2023/7/22 |
| Fangda Property | Warranty/mortgage guarantee | 5,000.00 | 2019/10/31 to 2023/7/22 |
| Fangda Property | Warranty/mortgage guarantee | 4,000.00 | 2020/03/11 to 2023/7/22 |
| Fang Qingling | Warranty/mortgage guarantee | 723.78 | 2019/7/31 to 2024/7/10 |
| Fang Qingling | Warranty/mortgage guarantee | 586.24 | 2019/8/27 to 2024/7/10 |
| Fang Qingling | Warranty/mortgage guarantee | 211.98 | 2019/9/27 to 2024/7/10 |
| Fang Qingling | Warranty/mortgage guarantee | 892.92 | 2019/11/18 to 2024/7/10 |
| Fang Qingling | Warranty/mortgage guarantee | 837.41 | 2019/12/20 to 2024/7/10 |
| Fang Qingling | Warranty/mortgage guarantee | 838.81 | 2020/01/15 to 2024/07/10 |
| Fangda Group | Guarantee | 8,000.00 | 2019/3/26 to 2021/3/20 |
| Fangda Group | Mortgage guarantee | 20,000.00 | 2020/03/02 to 2021/02/28 |
| Total | 174,191.14 |
Note: (1) Contingent liabilities caused by guarantees provided for other entities are all related guarantees between interested entitiesin the Group.
(2) The Group’s property business provides periodic mortgage guarantee for property purchasers. The term of the periodic guaranteelasts from the effectiveness of guarantee contracts to the completion of mortgage registration and transfer of housing ownershipcertificates to banks. By 30 June 2020, the Company has provided periodic guarantee of RMB492,341,700.On 30 June 2020, the Company has no other contingent events that should be disclosed.
(2) Significant contingent events that do not need to be disclosed should be explainedNo such significant contingent event
3. Others
As of June 30, 2020:
| Currency | Guarantee balance (original currency) | Deposit (RMB) | Credit line used (RMB) |
| RMB yuan | 529,151,563.44 | 717,500.00 | 528,434,063.44 |
| INR | 88,699,949.00 | 8,316,684.62 |
| HK $(HKD) | 15,349,982.00 | 14,021,287.56 |
| United States dollars (USD) | 8,649,642.54 | 5,668,461.72 | 55,566,682.64 |
| Total | 6,385,961.72 | 606,338,718.26 |
XV. Post-balance-sheet events
None
XVI. Other material events
1. Segment information
(1) Recognition basis and accounting policy for segment report
The Group divides its businesses into five reporting segments. The reporting segments are determined based on financial informationrequired by routine internal management. The Group’s management regularly review the operating results of the reporting segmentsto determine resource distribution and evaluate their performance.The reporting segments are:
(1) Curtain wall segment, production and sales of curtain wall materials, construction curtain wall design, production and installation;
(2) Rail transport segment: assembly and processing of metro screen doors;
(3) Real estate segment: development and operating of real estate on land of which land use right is legally obtained by the Company;property management;
(4) New energy segment: photovoltaic power generation, photovoltaic power plant sales, photovoltaic equipment R & D, installation,and sales, and photovoltaic power plant engineering design and installation
(5) Others
The segment report information is disclosed based on the accounting policies and measurement standards used by the segments whenreporting to the management. The policies and standards should be consistent with those used in preparing the financial statement.
(2) Financial information
In RMB
| Item | Curtain wall | Rail transport | Real estate | New energy | Others | Offset between segments | Total |
| Turnover | 843,816,163.62 | 333,462,675.90 | 60,051,984.40 | 10,091,179.07 | 13,111,787.37 | 8,925,725.94 | 1,251,608,064.42 |
| Including: external transaction income | 841,699,185.33 | 333,462,675.90 | 58,349,363.38 | 9,727,737.59 | 8,369,102.22 | 1,251,608,064.42 | |
| Inter-segment | 2,116,978.29 | 1,702,621.02 | 363,441.48 | 4,742,685.15 | 8,925,725.94 | 0.00 |
| transaction income | |||||||
| Including: major business turnover | 834,247,195.86 | 332,479,644.40 | 24,505,244.14 | 10,091,179.07 | 0.00 | 2,066,062.50 | 1,199,257,200.97 |
| Operation cost | 701,739,016.13 | 245,566,557.91 | 21,785,200.61 | 3,608,837.41 | 151,219.77 | 2,480,419.77 | 970,370,412.06 |
| Including: external transaction cost | 701,375,574.65 | 243,449,579.62 | 21,785,200.61 | 3,608,837.41 | 151,219.77 | 970,370,412.06 | |
| Cost | 363,441.48 | 2,116,978.29 | 2,480,419.77 | 0.00 | |||
| Including: major business cost | 697,304,141.14 | 245,365,878.41 | 18,478,958.78 | 3,608,837.41 | 0.00 | 2,480,419.77 | 962,277,395.97 |
| Total assets | 4,987,537,814.97 | 786,110,214.67 | 6,703,022,282.78 | 167,403,681.71 | 3,961,945,536.10 | 5,124,238,402.56 | 11,481,781,127.67 |
| Total liabilities | 3,602,397,272.93 | 509,624,610.93 | 4,281,233,329.32 | 74,886,385.86 | 1,715,194,487.39 | 3,926,709,504.20 | 6,256,626,582.23 |
(3) Others
Since more than 90% of the Group’s revenue comes from Chinese customer and 90% of the Group’s assets are in China, no detailedregional information is needed.XVII. Notes to Financial Statements of the Parent
(1) Account receivable
(1) Account receivable disclosed by categories
In RMB
| Type | Closing balance | Opening balance | ||||||||
| Remaining book value | Bad debt provision | Book value | Remaining book value | Bad debt provision | Book value | |||||
| Amount | Proportion | Amount | Provision rate | Amount | Proportion | Amount | Provision rate | |||
| Including: | ||||||||||
| Account receivable for which bad debt provision is made by group | 871,303.34 | 100.00% | 6,360.61 | 0.73% | 864,942.73 | 301,522.49 | 100.00% | 3,708.73 | 1.23% | 297,813.76 |
| Including: | ||||||||||
| Other business payment | 871,303.34 | 100.00% | 6,360.61 | 0.73% | 864,942.73 | 301,522.49 | 100.00% | 3,708.73 | 1.23% | 297,813.76 |
| Total | 871,303.34 | 100.00% | 6,360.61 | 0.73% | 864,942.73 | 301,522.49 | 100.00% | 3,708.73 | 1.23% | 297,813.76 |
Provision for bad debts by combination:
In RMB
| Name | Closing balance | ||
| Remaining book value | Bad debt provision | Provision rate | |
| Other business payment | 871,303.34 | 6,360.61 | 0.73% |
| Total | 871,303.34 | 6,360.61 | -- |
If the provision for bad debts of accounts receivable is made in accordance with the general model of expected credit losses, pleaserefer to the disclosure of other receivables to disclose information about bad debts:
□ Applicable √ Inapplicable
Account age
In RMB
| Age | Closing balance |
| Within 1 year (inclusive) | 871,303.34 |
| Total | 871,303.34 |
(2) Bad debt provision made, returned or recovered in the period
Bad debt provision made in the period:
In RMB
| Type | Opening balance | Change in the period | Closing balance | |||
| Provision | Written-back or recovered | Canceled | Others | |||
| Combination 3: Other business models | 3,708.73 | 2,651.88 | 6,360.61 | |||
| Total | 3,708.73 | 2,651.88 | 6,360.61 | |||
(3) Balance of top 5 accounts receivable at the end of the period
In RMB
| Entity | Closing balance of accounts receivable | Percentage (%) | Balance of bad debt provision at the end of the period |
| Top five summary | 638,638.30 | 73.30% | 4,662.05 |
| Total | 638,638.30 | 73.30% |
2. Other receivables
In RMB
| Item | Closing balance | Opening balance |
| Other receivables | 2,365,126,667.11 | 1,973,381,342.74 |
| Total | 2,365,126,667.11 | 1,973,381,342.74 |
(1) Other receivables
1) Other receivables are disclosed by nature
In RMB
| By nature | Closing balance of book value | Opening balance of book value |
| Deposit | 70,699.54 | 70,699.54 |
| Staff borrowing and petty cash | 3,671.12 | 15,881.12 |
| Debt by Luo Huichi | 12,992,291.48 | 12,992,291.48 |
| Others | 970,543.47 | 983,435.52 |
| Accounts between related parties within the scope of consolidation | 2,364,992,462.81 | 1,973,222,410.41 |
| Total | 2,379,029,668.42 | 1,987,284,718.07 |
2) Method of bad debt provision
In RMB
| Bad debt provision | First stage | Second stage | Third stage | Total |
| Expected credit losses in the next 12 months | Expected credit loss for the entire duration (no credit impairment) | Expected credit loss for the entire duration (credit impairment has occurred) | ||
| Balance on January 01, 2020 | 2,403.91 | 13,900,971.42 | 13,903,375.33 | |
| Balance on January 01, 2020 in the current period | —— | —— | —— | —— |
| Transferred back in the current period | 374.02 | 374.02 | ||
| Balance on June 30, 2020 | 2,029.89 | 13,900,971.42 | 13,903,001.31 |
Changes in book balances with significant changes in the current period
□ Applicable √ Inapplicable
Account age
In RMB
| Age | Closing balance |
| Within 1 year (inclusive) | 2,365,054,326.34 |
| 1-2 years | 3,671.12 |
| 2-3 years | 42,877.00 |
| Over 3 years | 13,928,793.96 |
| 3-4 years | 865,802.94 |
| 4-5 years | 12,992,291.48 |
| Over 5 years | 70,699.54 |
| Total | 2,379,029,668.42 |
3) Bad debt provision made, returned or recovered in the period
Bad debt provision made in the period:
In RMB
| Type | Opening balance | Change in the period | Closing balance | |||
| Provision | Written-back or recovered | Canceled | Others | |||
| Other receivables and bad debt provision | 13,903,375.33 | 374.02 | 13,903,001.31 | |||
| Total | 13,903,375.33 | 374.02 | 13,903,001.31 | |||
4) Balance of top 5 other receivables at the end of the period
In RMB
| Entity | By nature | Closing balance | Age | Percentage (%) | Balance of bad debt provision at the end of the period |
| Fangda Property | Associate accounts | 1,258,465,573.45 | Less than 1 year | 52.90% | |
| Fangda Jianke | Associate accounts | 1,001,298,680.64 | Less than 1 year | 42.09% | |
| Fangda New Energy | Associate accounts | 68,729,377.09 | Less than 1 year | 2.89% | |
| Shihui International | Associate accounts | 30,459,793.09 | Less than 1 year | 1.28% | |
| Luo Huichi | Debt by SOZN | 12,992,291.48 | 4-5 years | 0.55% | 12,992,291.48 |
| Total | -- | 2,371,945,715.75 | -- | 99.70% | 12,992,291.48 |
3. Long-term share equity investment
In RMB
| Item | Closing balance | Opening balance | ||||
| Remaining book value | Impairment provision | Book value | Remaining book value | Impairment provision | Book value | |
| Investment in subsidiaries | 1,065,202,785.05 | 1,065,202,785.05 | 963,508,253.00 | 963,508,253.00 | ||
| Total | 1,065,202,785.05 | 1,065,202,785.05 | 963,508,253.00 | 963,508,253.00 | ||
(1) Investment in subsidiaries
In RMB
| Invested entity | Opening book value | Change (+,-) | Closing book value | Balance of impairment provision at the end of the period | |||
| Increased investment | Decreased investment | Impairment provision | Others | ||||
| Fangda Jianke | 491,950,000.00 | 491,950,000.00 | |||||
| Fangda New Material | 74,496,600.00 | 74,496,600.00 | |||||
| Fangda Property | 200,000,000.00 | 200,000,000.00 | |||||
| Shihui International | 61,653.00 | 61,653.00 | |||||
| Fangda New Energy | 99,000,000.00 | 99,000,000.00 | |||||
| Hongjun Investment Company | 98,000,000.00 | 98,000,000.00 | |||||
| Fangda Zhichuang | 82,863,290.70 | 18,831,241.35 | 101,694,532.05 | ||||
| Total | 963,508,253.00 | 82,863,290.70 | 18,831,241.35 | 1,065,202,785.05 | |||
4. Operational revenue and costs
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| Income | Cost | Income | Cost | |
| Other businesses | 12,719,395.10 | 151,219.77 | 17,142,022.88 | 3,496,588.06 |
| Total | 12,719,395.10 | 151,219.77 | 17,142,022.88 | 3,496,588.06 |
Income information:
In RMB
| Contract classification | Others | Total |
| Including: Other businesses | 12,719,395.10 | 12,719,395.10 |
| Total | 12,719,395.10 | 12,719,395.10 |
Information related to performance obligations:
Information related to performance obligations:
5. Investment income
In RMB
| Item | Amount occurred in the current period | Occurred in previous period |
| Investment gain of financial products | 338,561.17 | 1,155,183.42 |
| Total | 338,561.17 | 1,155,183.42 |
XVIII. Supplementary Materials
1. Detailed accidental gain/loss
√ Applicable □ Inapplicable
In RMB
| Item | Amount | Notes |
| Gain/loss of non-current assets | -1,981.72 | |
| Subsidies accounted into the current income account (except the government subsidy closely related to the enterprise’s business and based on unified national standard quota) | 3,564,328.35 | |
| Gain/loss from change of fair value of transactional financial asset and liabilities, and investment gains from disposal of transactional and derivative financial assets and liabilities and sellable financial assets, other than valid period value instruments related to the Company’s common businesses | 1,926,439.93 |
| Gain/loss from commissioned loans | 397,420.84 | |
| Other non-business income and expenditures other than the above | -5,000,026.69 | |
| Less: Influenced amount of income tax | 339,144.08 | |
| Total | 547,036.63 | -- |
Explanation statement should be made for accidental gain/loss items defined and accidental gain/loss items defined as regulargain/loss items according to the Explanation Announcement of Information Disclosure No. 1 - Non-recurring gain/loss mentioned.
□ Applicable √ Inapplicable
2. Net income on asset ratio and earning per share
| Profit of the report period | Weighted average net income/asset ratio | Earning per share | |
| Basic earnings per share (yuan/share) | Diluted Earnings per share (yuan/share) | ||
| Net profit attributable to common shareholders of the Company | 2.81% | 0.13 | 0.13 |
| Net profit attributable to the common owners of the PLC after deducting of non-recurring gains/losses | 2.80% | 0.13 | 0.13 |
3. Differences in accounting data under domestic and foreign accounting standards
(1) Differences in net profits and assets in financial statements disclosed according to the international andChinese account standards
□ Applicable √ Inapplicable
(2) Differences in net profits and assets in financial statements disclosed according to the international andChinese account standards
□ Applicable √ Inapplicable
Chapter XII Documents for Reference
1. The Interim Report 2020 and the Summary with signature of the legal representative (Chinese and English);
2. Financial statements stamped and signed by the legal representative, CFO and accounting manager;
3. Originals of all documents and manuscripts of Public Notices of the Company disclosed in public in the newspapers as designatedby China Securities Regulatory Commission.