Songcheng Performance Development Co., Ltd
2020 Annual Report
April 2021
Section I Important Notes, Contents And DefinitionsThe Board of Directors, the Board of Supervisors, directors, supervisors and senior management members of the Companyhereby guarantee that the information presented in this annual report is authentic, accurate, complete and free of any false records,misleading statements or material omissions, and they will bear liabilities regarding this report.
Zhang Xian, Chief Executive Officer (CEO), Chen Shengmin, chief accountant, and Zhu Shana, head of accounting department(Accounting Officer) hereby declare and warrant that the financial statements in the annual report are authentic, accurate, andcomplete.All directors attended the meeting of the Board of Directors for deliberation of this annual report.There are specific reasons for the sharp decline in the Company’s performance during the reporting period. Risk factors thatmay exist in the production and operation of the Company and countermeasures, have been detailed in the sections "I. Overview"and "IX. Prospects for Future Development of the Company" of Section IV "Discussion and Analysis on Business Situation" of thisreport. Investors should be mindful to investment risks.The content concerning the future plan and performance forecast, if any, in this report shall not constitute the Company'scommitment to investors and relevant persons. Investors should maintain adequate risk awareness and must understand thedifferences between the plans, forecasts and commitments.
1. Risks of Natural Factors and Social Factors
The natural and social factors such as major natural disasters, public health emergencies and large social activities will affectthe number of tourists received. The outbreak of COVID-19 in 2020 was a global public health event, which resulted in stagnation oftourist and cultural consumption on the site, thereby affecting the business performances of the Company. The Company maydiffuse such risks through its strategic layout, but such periodical and local risk factors are generally irresistible once they occur.
2. Risks of Macroeconomic Fluctuation
In 2020, COVID-19 epidemic swept the world, and accelerated the change of the world political and economic situation unseenin a century. This presented the risk of change and anxiety to China's economy which was in and will remain in an important periodof strategic transformation and development for an extended period. The complicated and changeable domestic and internationalmacroeconomic environments may affect the level of national income and further, the consumer demands, thereby affecting theoperating performance of the Company.
3. Competition Risks
The competition risks include those from the same industry and those from the substitutes. The current high-qualitydevelopment of China's economy and the increasing cultural consumption demands from the general public drive the rapiddevelopment of the live performance industry, particularly the tourist performance. Seeing the enormous business opportunities, alarge amount of social capital swarmed into the tourist performance industry. This, on the one hand, promotes the development ofthe entire live performance industry, but on the other hand, inevitably intensifies the industry competition and affects theoperation of the Company. Meanwhile, the performance industry in the first-tier cities has developed to a certain level, presenting asmall but scattered development pattern. The Company, starting as a newcomer and integrator, shall undergo market adjustmentand adaptation at the initial stage.
With continuous technological progress, people have more choices for their cultural consumption from the emerging market ofdigital cultural consumption such as short videos, movies, games, TV shows, live broadcasts and VR/AR. Despite the irreplaceable
role of live experience, digital entertainment will attract some tourists and impact the live experience to a certain extent, affectingthe operation of the Company.
4. Risks in Safety Accidents
Live performances being a key component in the Company’s operation, may be occasionally hindered by safety accidents.Personal safety of visitors remains a major importance to the reputation of the Company.The profit distribution proposal approved by the Board of Directors is: Taking 2,614,694,040 as the basis, RMB 0.5 (tax included)of cash dividend and 0 bonus share (tax included) for every 10 shares will be distributed to all shareholders, and 0 share capitalizedfrom the capital reserves will be distributed to all the shareholders for every 10 shares.
Note:
This document is a translated version of the Chinese version 2020 Annual Report (“2020年年度报告”), and the published annualreport in the Chinese version shall prevail. The complete published Chinese 2020 Annual Report may be obtained atwww.cninfo.com.cn.
Table of Contents
Section I Important Notes, Contents And Definitions ...... 2
Section II Company Profile and Key Financial Indicators ...... 7
Section III Corporate Business Overview ...... 12
Section IV Discussion and Analysis on Business Circumstance ...... 15
Section V Significant Events ...... 39
Section VI Changes in Shares and Information about Shareholders ...... 62
Section VII Information of Preferred Shares ...... 70
Section VIII Convertible Corporate Bonds ...... 71
Section IX Directors, Supervisors, Senior Managers and Employees ...... 72
Section X Corporate Governance ...... 80
Section XI Corporate Bonds ...... 87
Section XII Financial Report ...... 88
Section XIII Documents Available for Reference ...... 254
Definitions
Item | Refers To | Definitions |
Company, the Company, Songcheng Performance | Refers To | Songcheng Performance Development Co., Ltd |
Songcheng Holdings | Refers To | Hangzhou Songcheng Group Holdings Co., Ltd, the controlling shareholder of the Company |
Songcheng Performance Valley Company | Refers To | Hangzhou Songcheng performance Valley technology and Culture Development Co., Ltd, a wholly-owned subsidiary of the Company |
Hangzhou Paradise Company | Refers To | Hangzhou Paradise Co., Ltd, a wholly-owned subsidiary of the Company |
Songcheng Art Troupe | Refers To | Songcheng Performance Management Co., Ltd, a wholly-owned subsidiary of the Company |
Songcheng Tourism | Refers To | Songcheng Tourism Development Co., Ltd, a wholly-owned subsidiary of the Company |
Sanya Romance Show Company | Refers To | Sanya Romance Tourism Performance Co., Ltd, a wholly-owned subsidiary of the Company |
Lijiang Chama Ancient City Company | Refers To | Lijiang Chama Ancient City Tourism Development Co., Ltd, a wholly-owned subsidiary of the Company |
Jiuzhai Romance Show Company | Refers To | Aba Zhou Jiuzhai Romance Tourism Development Co., Ltd, a wholly-owned subsidiary of the Company |
Shanghai Songcheng Company | Refers To | Shanghai Songcheng World Expo Performance Development Co., Ltd, a holding subsidiary of the Company |
Guilin Romance Show Company | Refers To | Guilin Lijiang Romance Performance Development Co., Ltd, a holding subsidiary of the Company |
Zhangjiajie Romance Show Company | Refers To | Zhangjiajie Romance Performance Development Co., Ltd, a wholly-owned subsidiary of the Company |
Xi'an Romance Show Company | Refers To | Xi'an Romance Performance Development Co., Ltd, a holding subsidiary of the Company |
Foshan Romance Show Company | Refers To | Foshan South Sea Qiao Mountain Cultural Tourism Development Co., Ltd, a wholly-owned subsidiary of the Company |
Xitang Songcheng Performance Valley Company | Refers To | Zhejiang Songcheng Xitang Performance Valley Performance Development Co., Ltd, a wholly-owned subsidiary of the Company |
Zhuhai Songcheng Company | Refers | Zhuhai Songcheng Performance Kingdom Co., Ltd, a wholly-owned subsidiary of the |
To | Company | |
Songcheng International | Refers To | Songcheng Performance International Development Co., Ltd, a wholly-owned subsidiary of the Company |
Songcheng Technology | Refers To | Hangzhou Songcheng Technology Development Co., Ltd, a wholly-owned subsidiary of the Company |
Dumuqiao Travel Agency | Refers To | Hangzhou Songcheng Dumuqiao Travel Services Co., Ltd, a wholly-owned subsidiary of Songcheng Tourism Development Co., Ltd, a wholly-owned subsidiary of the Company |
Songcheng Entertainment Company (Australia) | Refers To | Songcheng (Australia) Entertainment Pty Ltd., a wholly-owned subsidiary of Songcheng Performance International Development Co., Ltd, a wholly-owned subsidiary of the Company |
Jiuzhai Tibetan Mystery Company | Refers To | Jiuzhaigou Tibetan Mystery Culture Co., Ltd, a holding subsidiary of the Company |
Huafang Technology | Refers To | Beijing Huafang Technology Co., Ltd, a joint stock company of the Company |
China Securities Regulatory Commission (CSRC) | Refers To | China Securities Regulatory Commission |
Shenzhen Stock Exchange (SZSE) | Refers To | Shenzhen Stock Exchange |
yuan, ten thousand yuan | Refers To | RMB, RMB Ten Thousand |
Section II Company Profile and Key Financial IndicatorsI. Company Information
Stock Abbreviation | Songcheng Performance | Stock Code | 300144 |
Company Name in Chinese | 宋城演艺发展股份有限公司 | ||
Company Abbreviation in Chinese | 宋城演艺 | ||
Company Name in Foreign Language (If any) | Songcheng Performance Development Co., Ltd | ||
Abbreviation of Company Name in Foreign Language (If any) | Songcheng Performance | ||
Legal Representative | Zhang Xian | ||
Registered Address | 148 Zhijiang Road, Hangzhou City, Zhejiang Province | ||
Post Code of Registered Address | 310008 | ||
Office Address | 148 Zhijiang Road, Hangzhou City, Zhejiang Province | ||
Post Code of Office Address | 310008 | ||
Internet Website of the Company | https://www.songcn.com/Shares/ | ||
zqb@chinascyy.com |
II. Contact Person and Contact Information
Secretary of the Board | Representative of Securities Affairs | |
Name | Hou Li | Hou Li |
Contact Address | 148 Zhijiang Road, Hangzhou City, Zhejiang Province | 148 Zhijiang Road, Hangzhou City, Zhejiang Province |
Tel. | 0571-87091255 | 0571-87091255 |
Fax | 0571-87091233 | 0571-87091233 |
hl@songcn.com | hl@songcn.com |
III. Information Disclosure and Location
The Media Selected by the Company for Disclosure | Securities Times, Securities Daily |
Website Designated by CSRC for Publishing Annual Report | http://www.cninfo.com.cn |
Location for Annual Report of the Company | Securities Investment Department of the Company |
IV. Other Related InformationAccounting Firm Hired by the Company
Name of the Accounting Firm | BDO China Shu Lun Pan CPAs (special general partnership) |
Office Address of the Accounting Firm | No. 61 Nanjing East Road, Shanghai |
Name of Certified Public Accountant | Ni Yilin, Jiang Xuelian |
The sponsor institution hired by the company to perform the continuous supervision in the reporting period
□ Applicable √ Not applicable
The financial adviser hired by the company to perform the continuous supervision in the reporting period
□ Applicable √ Not applicable
V. Key Accounting Data and Financial IndicatorsWhether the Company needs performed retroactive adjustment or restatement of accounting data in prior years or not
□ Yes √ No
2020 | 2019 | Increase/decrease compared with previous year | 2018 | |
Operating income (RMB) | 902,586,125.63 | 2,611,753,208.86 | -65.44% | 3,211,192,814.48 |
Net profit attributable to shareholders of the listed Company (RMB) | -1,752,398,009.60 | 1,339,790,994.94 | -230.80% | 1,287,186,547.41 |
Net profit attributable to shareholders of the listed company after deducting non-recurring gains and losses (RMB) | -1,767,861,638.68 | 1,222,100,617.31 | -244.66% | 1,279,733,108.31 |
Net cash flow generated by operational activities (RMB) | 393,941,899.94 | 1,571,451,499.51 | -74.93% | 1,647,243,748.01 |
Basic Earnings per Share (RMB/Share) | -0.6702 | 0.5124 | -230.80% | 0.8861 |
Diluted Earnings per Share (RMB/Share) | -0.6702 | 0.5124 | -230.80% | 0.8861 |
Weighted Average ROE | -20.50% | 14.52% | -35.02% | 16.38% |
End of 2020 | End of 2019 | Increase/Decrease at the end of the current year compared with the end of the previous year | End of 2018 | |
Total assets (RMB) | 9,195,342,831.06 | 11,041,076,933.58 | -16.72% | 10,817,160,458.62 |
Net assets attributable to shareholders of the listed company (RMB) | 7,412,287,432.06 | 9,614,069,166.64 | -22.90% | 8,471,075,013.49 |
The lower of the Company's net profit before and after deduction of non-recurring profit and loss for the last three fiscal years isnegative, and the audit report for the latest year shows that there is uncertainty about the Company's ability to continue operating
□ Yes √ No
The lower of net profit before and after deduction of non-recurring profit and loss is negative
√ Yes □ No
Item | 2020 | 2019 | Notes |
Operating income (RMB) | 902,586,125.63 | / | Total Operating Income |
Amount deducted from operating income (RMB) | 6,381,032.95 | / | Income from personnel dispatch management and other miscellaneous businesses |
Amount of operating income after deduction (RMB) | 896,205,092.68 | / | Operating income of main business |
Total share capital of the Company as at the trading date preceding the disclosure:
Total share capital of the Company as at the trading date preceding the disclosure (share) | 2,614,694,040 |
Whether the share capital has been changed for issuance of new shares, addition, allotment, exercise of equity incentives andbuy-back, and whether the amount of the owners' equity is influenced from the end of the reporting period of the Company to thedisclosure date of the annual report
□ Yes √ No
Preferred stock dividends paid | 0.00 |
Fully diluted earnings per share calculated with the latest share capital (RMB/share) | -0.6702 |
VI. Key Financial Indicators by Quarter
Unit: RMB
Q1 | Q2 | Q3 | Q4 | |
Operating income | 134,352,197.80 | 148,522,407.15 | 335,646,114.92 | 284,065,405.76 |
Net profit attributable to shareholders of the listed company | 49,960,280.55 | -10,112,011.86 | 93,903,527.78 | -1,886,149,806.07 |
Net profit attributable to shareholders of the listed company after deducting non-recurring gains and losses | 18,467,729.86 | 1,512,334.57 | 91,357,882.55 | -1,879,199,585.66 |
Net cash flow generated by operating activities | -20,444,426.81 | -103,304,029.48 | 282,447,994.96 | 235,242,361.27 |
Whether the above financial indicators or their totals are significantly different from the financial indicators disclosed in theCompany’s quarterly and semi-annual reports
□ Yes √ No
VII. Differences in Accounting Data Under Domestic and Foreign Accounting Standards
1. Differences of net profits and net assets in the financial reports disclosed according to the internationalaccounting standards and Chinese accounting standards
□ Applicable √ Not applicable
During the reporting period of the company, there is no difference between the net profits and net assets in the financial reportsdisclosed according to international accounting standards and Chinese accounting standards.
(2) Differences between the net profits and net assets in the financial reports disclosed according to theoverseas accounting standards and Chinese accounting standards
□ Applicable √ Not applicable
During the reporting period of the company, there is no difference between the net profits and net assets in the financial reportsdisclosed according to overseas accounting standards and Chinese accounting standards.
3. Reasons for differences in accounting data under domestic and overseas accounting standards
□ Applicable √ Not applicable
VIII. Non-recurring Gains and Losses Items and Their Amounts
√ Applicable □ Not applicable
Unit: RMB
Item | Amount in 2020 | Amount in 2019 | Amount in 2018 | Note |
Profits or losses from disposal of non-current assets (including the write-off for the accrued impairment of assets) | -37,625,882.13 | 70,970,952.64 | -30,333,257.21 | |
The government subsidies included in the current profits and losses (excluding the government subsidies closely related to regular businesses of the Company and issued in the quota or quantity based on the national standards) | 35,618,594.19 | 5,629,978.38 | 12,326,627.98 | |
Gains or losses from investment or asset management entrusted to others | 25,795,007.28 | |||
Profits and losses resulting from the changes in fair value for holding trading financial assets, derivative financial assets and trading financial liabilities, derivative financial liabilities and investment income from disposal of trading financial assets, derivative financial assets, trading financial | 19,619,586.83 | 52,061,383.80 | 21,276,486.89 |
Item | Amount in 2020 | Amount in 2019 | Amount in 2018 | Note |
liabilities, derivative financial liabilities, and other obligatory right investment, excluding the effective hedging businesses related to the regular business operation of the Company | ||||
Non-Operating Revenue and expenses other than the above | -509,618.20 | -19,029,327.85 | -21,969,795.85 | |
Less: Impact of income tax | 2,230,795.39 | -7,184,125.78 | 556,654.96 | |
Impact of minority equity (after tax) | -591,743.78 | -873,264.88 | -915,024.97 | |
Total | 15,463,629.08 | 117,690,377.63 | 7,453,439.10 | -- |
For items defined as non-recurring gains and losses according to the No. 1 Explanatory Announcement on Information Disclosurefor Companies Offering Their Securities to Public - Non-recurring Gains and Losses, or non-recurring gains and losses items listed inthe said document defined as recurring ones, please specify the reasons.
□ Applicable √ Not applicable
In the reporting period, the Company did not define any non-recurring gains and losses items defined and listed in the No. 1Explanatory Announcement on Information Disclosure for Companies Offering Their Securities to Public - Non-recurring Gains andLosses, as recurring gains and losses items.
Section III Corporate Business OverviewI. The Principal Business of the Company during the Reporting Period
1. Vision and mission
The Company upholds the philosophy of "a drop of water in need, shall be returned with a spring in deed", to providecustomers with warm on-site entertainment experiences. It is dedicated to telling global stories of Chinese culture, promotingconfidence of the nation, and striving to become the world's premier company in cultural performing arts.
2. Main business and products
During the reporting period, the Company was mainly engaged in cultural performance business. On-site performance andtourism and recreation are the Company's main businesses.
Live performance is the Company's core business and main source of incomes and profits. Based on the Company's twomajor brands of "Songcheng" and "Romantic Show", the original business mode of "theme park + cultural performance" providescustomers with theme park amusement and a variety of shows. Business income mainly comes from sales of tickets. Projects underoperation include "Romantic Show of Songcheng", "Romantic Show of Sanya", "Romantic Show of Lijiang", "Romantic Show ofJiuzhai", "Romantic Show of Guilin", "Romantic Show of Zhangjiajie", and "Romantic Show of Xi'an". The Songcheng project inShanghai will be unveiled on April 29, 2021, and projects under construction in Foshan, Xitang, and Zhuhai will also be introduced tothe market.
Tourism and recreation mainly refer to light-asset output business and online sales of tickets. Based on the Company'sbusiness capabilities and brand accumulation over the years, the light-asset output business provides partners with brandauthorization, planning and design, director and creation, entrusted operation and other services, and realizes business income by apackage of service fees and entrusted operation management fees. The light-asset output projects in operation include "RomanticShow of Tanhe", "Romantic Show of Mingyue (Moon)" and "Romantic Show of Huangdi (Yellow Emperor)". Online sales of ticketsrefer to online direct sales and distribution of tickets of performances and projects operated by the Company, and sales of jointtickets and ticket packages with third-party tourist attractions.
II. Material Changes to Major Assets
1. Major changes in main assets
Major Assets | Explanation Of Material Changes |
Equity assets | At the end of the reporting period, the long-term equity investment decreased by RMB 1,934,056,500 compared with the beginning of the period, which was mainly due to the impairment of the long-term equity investment of Huafang Technology held by the Company during the reporting period. |
Fixed Assets | By the end of the reporting period, the fixed assets increased by RMB 197,503,700 compared with the beginning of the period, which was mainly due to conversion of the Company's projects in construction to fixed assets during the reporting period. |
Intangible Assets | At the end of the reporting period, the intangible assets increased by RMB 381,541,800 compared with the beginning of the period, mainly due to the acquisition of land use rights by Zhuhai Songcheng Performance Kingdom during the reporting period. |
Projects under Construction | By the end of the reporting period, projects in construction increased by RMB 401,871,300 compared with the beginning of the period, which was mainly due to the increased investment in construction by the Company during the reporting period. |
2. Major overseas assets
√ Applicable □ Not applicable
Details of the Assets | Causes | Asset Size | Location | Operation Mode | Control Measures to Ensure Asset Safety | Income Status | Proportion of Foreign Assets in Company's Net Assets | Significant Risk of Impairment |
Land | Purchase | 448,900 square meters | Gold Coast, Queensland, Australia | Theme park + Art performance | Suspended | 3.80% | No | |
Other Information | N/A |
III. Core Competitiveness AnalysisThrough continuous efforts, the Company has established a nationwide chain operation, with more than 40 million regularaudiences per year. Our market share ranks among the top and continues to increase, with rising efficiency in resource allocationand brand influence. As a leading enterprise in China's performing arts industry, the Company's core competitiveness is mainlyreflected in the following aspects:
1. Advantages of business mode
Centering on performing arts in theme parks with creativity, the Company is different from traditional companies inperforming arts and tourism. The business mode of "theme park + cultural performance" helps solve high performance costs, hightraffic attraction costs, and low frequency of audience replacement faced by common performing arts enterprises withoutself-owned venues. For the tourism industry, the mode has overcome shortcomings of insufficient core competitiveness, poorreproducibility, excessive reliance on large-scale and costly amusement equipment, low marginal effect, homogeneous services, andweak profitability experienced by more traditional enterprises. From the Romantic Show model of "one show, one park", theCompany is transforming to the performing arts kingdom of "multiple theaters, shows, activities, and tickets", a move to expand itsbusiness content by enriching the performing art experience for stronger competitiveness.
2. Advantages in creation and design
The Company has an experienced, professional and independent team in planning, design, creation and performance. In theplanning and design of theme parks and creation of performance products, team members can fully integrate their own innovativeideas through a deep understanding of local culture. During operation, new elements can be included in a timely manner accordingto changes in the industry and the market. Simultaneously, inspiration and creativity are encouraged to constantly upgrade productsand services for better tourist experiences. The advantages in creation and design are an important guarantee for the Company toadvance through exciting innovation and breakthroughs.
3. Professional advantages
After years of development in the performing arts industry, the Company has accumulated and trained a large number ofprofessional talents, and established a standardized operation and management system, with a strong understanding of
development laws and features of the industry. The Company has become highly skilled in project site selection, investment control,performing arts creativity and design, stage presentation, costume props, scenic spot operation, viewing experience, and dailymanagement.
4. Marketing advantages
As internet, mobile internet, and new media are on the rise, the Company took advantage of its creative capabilities, andconducted online and offline creative marketing. Topics were made to promote spontaneous media dissemination to realizelow-cost coverage of consumers, therefore providing market expansion and income growth in the process. In a time whenGeneration Z has gradually become the main consumer force, the Company's flexible marketing strategies ensures target groups tobe covered through online short videos, in-depth offline promotion and on-site activities.
5. Advantages in on-site experience
Internet and mobile internet have changed the business models of many traditional industries, and have brought a numberof existing industries considerable impacts and challenges. However, they cannot replace the enrichment gained through on-siteexperience and participation to meet people's spiritual and cultural needs at higher levels. In an era with changing technologicalinnovation, the Company's advantages in outstanding on-site experiences are becoming more obvious.
6. Closed-loop advantages
The Company has closed-loop teams covering the entire industry chain from site selection, planning and design, investmentand construction, direction and creation, opening planning, operation management, continuous improvement, event planning,ticket price system setting, and marketing. The closed-loop coverage of the entire industry chain contributes in controlling costs,improving efficiency, and enhancing profitability of the Company.
7. Platform advantages
Thanks to continuous development and expansion, the Company has a leading position in the number of projects, theatersand seats, performances, and audiences. It has initially established a cultural performance platform covering first-tier tourism andleisure destinations and urban clusters across the country. The large scale and huge tourist base will help the Company expand itsbusiness boundaries, reduce marginal costs, improve operational efficiency, enhance brand influence and create performanceproducts with brand and its exclusive and innovative features.
8. Brand advantages
As the largest performing arts group in China, Songcheng Performance's "Songcheng" and "Romantic Show" have becomerepresentative brands in live performing arts and creative industries. Our good market reputation and strong brand influence havebenefited the Company in project expansion, resource control, talent attraction, and market development.
9. Advantages in locations
The Company took the lead in businesses in important cities and first-tier tourism and leisure destinations in the country, andhas advantages in locations. As urban performing arts continue to advance, the Company will gradually move into mega and largecities, and continue to strengthen and consolidate its position.
Section IV Discussion and Analysis on Business Circumstance
I. Overview
2020 is an extraordinary year in the history of the world, a year of ups and downs. The spread of COVID-19 in more than 199countries and regions has taken a toll on human life safety and global economic development, and significantly raised the risk ofeconomic recession and uncertainties through out the world. The disrupted supply chains, shrinking consumption and investmentdemand, weakened economic activities, and impaired market confidence have brought unprecedented challenges to the resilienceand governance of countries and economic entities. The year of 2020 is also full of critical challenges for the cultural and travelindustry. The industry was in a standstill the first half of the year yet managed to recover in the second half of the year when theepidemic receded. The road was a bumpy one, yet in recovery, new opportunities arose.As the last year for China to build a moderately prosperous society in an all-round way and the "13th Five-Year Plan", 2020 is ahistorical transition period from the "13th Five-Year Plan" to the "14th Five-Year Plan". It is also a time for China to strive forhigh-quality economic development with an optimized industrial structure by weighing the modern service industry more. Toanswer the strategic call for high-quality development, the cultural and tourist industries have entered a new stage for better quality,efficiency, and will become the new powerhouse for further economic growth.During the reporting period, the Company's scenic spots suspended operations from January 24, 2020, and resumedoperations on June 12, 2020. The Company has fully prepared itself to turn crises into opportunities through well balancedepidemic controls and strong corporate oversight. With effective epidemic prevention in place, the Company has optimized andupgraded the hardware, software, marketing, and organizational structure during park closure. Meanwhile, improvement of variousprojects was also implemented. Hangzhou Songcheng, as a test field, was rebuilt into a new Hangzhou Songcheng PerformingKingdom. The mode of "one show, one park, one ticket" was transformed and upgraded to a performing arts platform with multipleshows and combination of a variety of tickets. Since resumption of business, the Company has been fully prepared to activelypromote its market recovery of tourists and revenue through online new media, short videos, offline promotion, special marketsand activities and other marketing methods. In terms of new projects, Xi'an and the light-asset project in Zhengzhou successfullypresented first shows, projects in Shanghai, Foshan, and Xitang were progressing, the Zhuhai project started construction, and thecontracgt for the light-asset project in Yan'an project was signed, providing significant momentum for the Company's future growth.
During the reporting period, the Company achieved operating income of RMB 902,586,100, a year-on-year decrease of 65.44%;net profit attributable to shareholders of the listed company was -1,752,398,000, a year-on-year decrease of 230.80%; net profitattributable to shareholders of the listed company after deducting non-recurring profit and loss was -1,767,861,600 yuan, ayear-on-year decrease of 244.66%.
Excluding the financial data of the digital entertainment platform and the increase or decrease in the long-term equityinvestment of Huafang Technology, the Company's pro forma profit statement is as follows:
During the reporting period, the Company achieved operating income of RMB 902,586,100, a year-on-year decrease of 59.50%;net profit attributable to shareholders of the listed company was 113,724,700 yuan, a year-on-year decrease of 89.11%; net profitattributable to shareholders of the listed company after deducting non-recurring profit and loss was 98,261,100 yuan, ayear-on-year decrease of 90.86%.
The key tasks carried out by the Company during the reporting period are as follows:
(I) Hardware expansion
1. Increase the type and number of theaters
With Hangzhou Songcheng as a model, the Company deeply explored existing resources of scenic spots to introduce differenttypes of indoor and outdoor performance venues with varied experiences. It built upgraded standard theaters, walk-aroundtheaters, cliff theaters, forest theaters, floating theater and other new theaters, delivering new and extraordinary experiences to itsguests.No. 2 and No.3 Romantic Show Theater is an upgraded version of the Company's standard theaters. The combination of thecliff theater and elegant music, and the forest theater and popular fashion provide visitors with more choices. During the reportingperiod, 10 indoor and outdoor theaters and more than 10,000 seats were added in the Hangzhou Songcheng scenic spot duringbusiness suspension in response to the epidemic. No.2 and other types of theaters were added to existing or new projects tofurther expand the capacity. The continuous increase in the number of theaters and seats is conducive to diversified performances,larger reception capacity, and better tourist experiences. It also makes it possible in hardware to provide products, content, andtickets on many different levels.
2. Extend touring routes
Taking Sanya as an example, the original touring route was only a few hundred meters long. With diversion and aggregation,the route length was extended by 3 to 4 times by combining underutilized space. Another example is the restructuring of HangzhouSongcheng. Without expanding the area, the play route was redesigned, and indoor and outdoor small theaters, and interactivespaces were added with a series of new performances. These measures have improved the tourist experience and effectivelyextended park visitor duration.
3. New popular sites
The Generation Z loves recommending and sharing. Growing up in the internet era, their consumption is trendier and moreindividual. To meet the needs of young people, the Company's scenic spots have created many popular sites, including "GlassSkywalk", Setting of Marionette, Sky Tree, Setting of Ayue out of Bath, interactive amusement park of oiled paper umbrellas, lovelike device, sound post office, and 3D printing wall. The introduction of the role play hall is also favored by young people, enhancingtheir experience and atmosphere of the scenic spot.
4. Improved supporting facilities
Supporting facilities were further improved in scenic spots. Landscape design and presentation were enhanced with more largeentrance halls and rest areas. While increasing the proportion of self-operated businesses, the Company will continue to buildall-weather, comfortable, convenient and safe scenic spots for all. Hangzhou Songcheng for example, two newly built large foodcourts can accommodate 1,500 people at the same time, bringing a variety of delicious foods to meet guests expectations. At thesame time, the proportion of self-operated shops was also expanded in projects in other parks to upgrade product types, qualitycontrol, and hardware.
(II) Content upgrade
With continuous expansion of our commercial landscape, the Company, centering on "Romantic Show" and supplemented by"Love in" and "Color" series, has gradually formed a content matrix in outfield performances, cooperation, customization,introduction, and procurement of shows.
1. "Romantic Show" series
Led by the chief director under the new organizational structure and creation model, the Company's art team work hard withan innovative spirit. Romantic Show of Xi'an and Romantic Show of Huangdi have opened, and Romantic Show of Shanghai and
Romantic Show of Foshan are proceeding in an orderly manner. During the reporting period, "Romantic Show of Xi'an and RomanticShow of Huangdi have opened. The Company expanded operation in northern areas, with rising market and brand value and aconsolidated position as China's top performing arts brand and industry leader.
2. "Love in" and "Color" series
Currently, the Company is stepping up preparations for the "Love in" and "Color" series. The "Love in" series focuses on theoriginal ecological folk culture to present local customs; the "Color" series is a boutique performing arts for tourists, which is a grandinteractive show filled with fashion, culture, technology, light and shadow, dreams, surprises, suspense, and elements favored byyoung people. The Company has also enabled new and young director teams from the headquarters and affiliated art troupes onthese shows, cultivating a younger director team.
3. Indoor small and medium drama
In addition to the original 5D real-life drama "The Earthquake" and the holographic show "Phantom", the Company launched anew parent-child show "Beware-Dinosaurs!", nostalgic drama "Katyusha", and walk-around performance "Shangganling" and"'Ahoy' Captain Cook!" during the reporting period. These new performances greatly enhanced its performing arts portfolio.
4. Outdoor series
In terms of outfield performance, the Company has resumed the classic traditional dramas, including the martial arts drama"Yanqing on Stage Contest" and the interactive drama "The Case of Chen Shimei", and added trendy content like cliff concerts,forest and water concerts, and electronic music parties for tourists, providing tourists with more entertainment options.
(III) Marketing optimization
During the reporting period, the Company achieved excellent results in marketing through online short videos and new media,offline field promotion and penetration into special markets.
1. Online
Build up new space in network communication and strengthen the diversified development of We media and short videoplatforms. The Company has closely integrated brand promotion with marketing through content marketing, online gifts andcoupons, and offline diversion, to maintain continuous growth of its followers and increasing their retention rate. In addition,employees were encouraged to post contents on Tik Tok to increase exposure of various scenic spots on network communicationplatforms.
2. Offline
In recent years, consumption of young people in small towns is on the rise. In line with local conditions, the Company startedfirst round marketing in lower-level regions, especially towns contributing more customers. Flyers, wall paintings, and promotionmaterials were used to effectively expose the brand to potential customers.
3. Activities
Since resumption of business, the Company has launched different seasonal and holiday themed activities according to variousfestivals and timings such as surrounding tours, summer night tours, National Day, Halloween, Christmas Day and New Year's Day,and Spring Festival. Different ticket prices and product combinations have been tested in the market, and subsequently, a diverseprice system for the it’s performing arts venues has been instituted.
(IV) Optimized organizational structure
1. Optimizing vertical management
The Company's vertical management conducts all-around, refined and standardized management of performance quality,equipment uses, safety, and scenic spot operation, and has instituted a regular meeting system. The management system has beenrunning effectively now for 3 years. With the rapid increase of projects, everything, from lighting, sound, dance, props,management, to guest reception, must have strict oversight. Standards and vertical management can reduce levels to ensureaccuracy of management points.
2. Optimizing creation team
The continuous development of the Company and the epidemic prompted the optimization, adjustment and integration of thecreation team. The original direction and creation team cultivated from actors has limitation in overall quality, which affects thespeed and quality of product creation. During the reporting period, the Company adjusted the original team, some were transferredto the management of the art troupe, and others remained in the creation team. At the same time, professional talents withexperiences in large-scale performances, and outstanding talents of Beijing Dance Academy and other colleges were absorbed. Thecurrent staff structure as a result is more diverse and efficient.
3. Establishing an innovation department
The Company established the Innovation Department, which is mainly responsible for creation of popular content on internetand introduction of creative devices. The department shall introduce relevant fresh information within and beyond the industry tothe Company in a timely manner, and add, supplement, and improve new business patterns, experience projects, and landscapeatmosphere to various scenic spots. At the same time, it will collect information for tourism and urban performance potentials. Thedepartment shall help solve the deficiencies of original internet applications and popular contents, and serve as the Company'sfront runner to reach leading projects.
(V) Preparation of Shanghai project
The Shanghai project is located in the city's permanent green space Expo Park near Huangpu River. It combines elements ofShanghai-style culture, old industrial base, and fashion vitality with an outstanding location, convenient transportation and goodsupporting facilities. In the post-epidemic era, the Shanghai government has put forward a call to "build a performing arts center ofAsia". Firmly grasping this opportunity, the Company will spare no effort to create a “jewel” of performing arts in Shanghai.
After more than two years of construction, especially the in-depth development and model testing of the Performing ArtsKingdom since the epidemic, the Shanghai project will open with rich program content.
Rooted in the magnificent history of Shanghai, the main show "Romantic Show of Shanghai" tells the great chapters of the citywith profound culture, passion, and high-tech international stage means. The performance is divided into chapters of "The Origin ofShenhu", "1921", "Modern Years", "Shanghai Family", and "Wind from the Sea". On the stage, the audience will experience theSongze archaeological site dating back 6000 years, Sir Chunshen's manor estate granted by the emperor in the Warring StatesPeriod, the glorious history of 1st National Congress of CPC, the ups and downs of the Shili Yangchang in the 1920s and 1930s, thegrand atmosphere of the World Expo in the new century. On stage, the core culture of the 30-year development and opening ofPudong is proudly presented. The vivid presentation of Shanghai’s red culture, Shanghai-style culture, and Jiangnan culture willbring the audience a visual and spiritual feast.
At the same time, the Performing Park also launched 4 special performances for different groups with different styles, including
hundreds of actors from more than ten countries. The High Show "Color" centers on the performing arts complex of Songcheng inShanghai, and sets up multiple performance spaces with different styles on each floor. Each performance space is uniquely set upwith an independent plot in movie-level scenes, which highly restores the real texture under different themes. Walking in theperformance space of "Color", the audience will encounter different characters and trigger different stories at every corner. As ahigh-tech stage production, the parent-child show "Beware-Dinosaurs!" is a collision of art and science filled with knowledge. Thelarge-scale dinner show "Samba Passion" brings together top dancers from Argentina, Cuba, Russia, and Ukraine, presenting thepurest South American flavor and beat to the audience. The brilliant show "S" will bring an electric spark to all.This venue is a brand new performance park designed to shock your imagination. "Battle of Shanghai", "The Earthquake","Ghost Ship", "Liaozhai Ghost House", "Storm Eye", naked-eye 3D and other large-scale interactive experience projects will impressevery tourist. It is like a world away while walking on Crossing Street, Magic Street, Market in Heaven, and Romantic Street; everystop is a scene in the music square. There will also be “the colorful forest”, the “fairy valley”, the “sky city”, the glass platform andthe rattan bridge as splendid shows are staged every day at more than 20 theaters and performance venues, including the standardtheater, the bird show theater, the forest theater, and the cliff theater. As an open art district, Songcheng Downtown has multiplevariable spaces and a performance square that can accommodate tens of thousands of people, which is a comprehensive artperformance platform. The performance park welcomes people of all ages with daily shows and trendy activities each week.
Through customized hardware, diversified content creation and a circle-based pricing system, the Shanghai project will coverthe overall population and with precise penetration. With rich contents and different customer groups, the Shanghai project willhave a diversified ticket pricing system, including single tickets, a package ticket of Romantic Show, combined tickets, discountedgroup tickets, children's tickets, and night party tickets.(VI) Live broadcast platformIn recent years, the internet performance/digital entertainment industry has entered a stage of steady development withintensified competition. The PC market continues to be eroded by the mobile market. During the reporting period, people stayedmore at home due to the epidemic. As a result, they spent more time on internet, bringing a new wave of benefits to digitalentertainment platforms; live broadcast technology empowered offline industries, live education, live consultation, and "CloudConcerts" , "Cloud Wedding" and "Cloud Recruitment" have emerged. These have integrated into all aspects of people's daily life. Inthe current market environment, the digital entertainment industry faces both opportunities and challenges. During the reportingperiod, the overall business of Huafang Technology developed well, with increasing paying users, consumption users, operatingincome and operating profit. In terms of segments, the performance of Six Rooms has shown fluctuation as it has entered the stageof business optimization and operation improvement; while Huajiao Live has shown a growth trend with a leading position in theindustry in terms of user usage time and penetration among active users.(VII) OtherIn 2020, the global outbreak of COVID-19 brought the cultural travel industry almost to a halt. During this period, the Companydid not stop in strategic development thinking and new project expansion, and conducted a comprehensive evaluation of existingprojects and businesses. Given that the main business of Zhejiang Songcheng Longquanshan Tourism Development Co., Ltd. isdifferent from the Company's future strategic development plan, the Company signed a contract with Longquan Tourism InvestmentDevelopment Co., Ltd. under the People's Government of Longquan, Zhejiang Province in April 2021 to transfer all the equity ofZhejiang Songcheng Longquanshan Tourism Development Co., Ltd. at a total consideration of 276 million yuan. The implementationof this equity transfer is conducive to a stable operation transfer of Longquanshan project, and also helps the Company optimizecapital, resource allocation and asset structure, and improve asset operation efficiency to focus on its main business.
II. Main Business Analysis
1. Overview
See "I. Overview" in "Discussion and Analysis on Business Circumstance".
2. Income and Costs
(1) Operating income structure
Overall operating income
Unit: RMB
2020 | 2019 | Year-on-year increase or decrease | |||
Amount | Proportion in Operating Revenue | Amount | Proportion in Operating Revenue | ||
Total Revenue | 902,586,125.63 | 100% | 2,611,753,208.86 | 100% | -65.44% |
By Industry | |||||
I. Culture and Art Industry - Live Performance | 675,872,865.35 | 74.88% | 1,871,167,934.09 | 71.64% | -63.88% |
II. Culture and Art Industry - Performance on Internet | 383,412,284.25 | 14.68% | -100.00% | ||
III. Tourism Service Industry | 226,713,260.28 | 25.12% | 357,172,990.52 | 13.68% | -36.53% |
By Product | |||||
1. Songcheng in Hangzhou | 286,877,405.89 | 31.78% | 918,884,614.29 | 35.18% | -68.78% |
2. Songcheng in Sanya | 127,098,246.23 | 14.08% | 392,729,155.06 | 15.04% | -67.64% |
3. Songcheng in Lijiang | 136,520,949.23 | 15.13% | 333,433,832.57 | 12.77% | -59.06% |
4. Songcheng in Jiuzhai | 25,667,095.21 | 2.84% | |||
5. Songcheng in Guilin | 56,586,027.07 | 6.27% | 160,649,726.51 | 6.15% | -64.78% |
6. Songcheng in Zhangjiajie | 18,120,963.58 | 2.01% | 65,470,605.66 | 2.51% | -72.32% |
7. Songcheng in | 25,002,178.14 | 2.77% |
2020 | 2019 | Year-on-year increase or decrease | |||
Amount | Proportion in Operating Revenue | Amount | Proportion in Operating Revenue | ||
Xi'an | |||||
8. Digital entertainment platform | 383,412,284.25 | 14.68% | -100.00% | ||
9. E-commerce service charge | 43,316,562.23 | 4.80% | 180,426,687.71 | 6.91% | -75.99% |
10. Design and planning fees | 183,396,698.05 | 20.32% | 173,281,416.46 | 6.63% | 5.84% |
11. Supporting facilities and transportation services for scenic spots | 3,464,886.35 | 0.13% | -100.00% | ||
By Region | |||||
1. Zhejiang Province | 513,590,666.17 | 56.90% | 1,276,057,604.81 | 48.86% | -59.75% |
2. Sanya, Hainan Province | 127,098,246.23 | 14.08% | 392,729,155.06 | 15.04% | -67.64% |
3. Lijiang, Yunnan Province | 136,520,949.23 | 15.13% | 333,433,832.57 | 12.77% | -59.06% |
4. Sichuan Province | 25,667,095.21 | 2.84% | |||
5. Beijing | 383,412,284.25 | 14.68% | -100.00% | ||
6. Guilin, Guangxi Province | 56,586,027.07 | 6.27% | 160,649,726.51 | 6.15% | -64.78% |
7. Zhangjiajie, Hunan Province | 18,120,963.58 | 2.01% | 65,470,605.66 | 2.50% | -72.32% |
8. Xi'an, Shaanxi Province | 25,002,178.14 | 2.77% |
(2) Industry, product, or region accounting for more than 10% of the company's operating revenue or profit
√ Applicable □ Not applicable
Unit: RMB
Operating income | Operating Cost | Gross margin | Increase or decrease of operating income compared with the same period of last year | Increase and decrease of operating cost over the same period of last year | Increase or decrease of gross profit compared with the same period of last year | |
By Industry | ||||||
I. Culture and Art Industry - Live Performance | 675,872,865.35 | 341,549,955.68 | 49.47% | -63.88% | -28.09% | -25.15% |
II. Tourism Service Industry | 226,713,260.28 | 11,120,517.74 | 95.09% | -36.53% | -89.09% | 23.64% |
By Product | ||||||
1. Songcheng in Hangzhou | 286,877,405.89 | 186,752,833.49 | 34.90% | -68.78% | -35.30% | -33.69% |
2. Songcheng in Sanya | 127,098,246.23 | 29,293,691.27 | 76.95% | -67.64% | -50.29% | -8.04% |
3. Songcheng in Lijiang | 136,520,949.23 | 34,341,329.43 | 74.85% | -59.06% | -42.14% | -7.35% |
4. Design and planning fees | 183,396,698.05 | 8,113,082.55 | 95.58% | 5.84% | 100.08% | -2.08% |
By Region | ||||||
1. Zhejiang Province | 513,590,666.17 | 197,873,351.23 | 61.47% | -59.75% | -49.34% | -7.92% |
2. Sanya, Hainan Province | 127,098,246.23 | 29,293,691.27 | 76.95% | -67.64% | -50.29% | -8.04% |
3. Lijiang, Yunnan Province | 136,520,949.23 | 34,341,329.43 | 74.85% | -59.06% | -42.14% | -7.35% |
When the statistical caliber of the company's main business data is adjusted in the reporting period, the company's main businessdata should be subject to the one after the statistical caliber at the end of the reporting period is adjusted in the most recent year.
□ Applicable √ Not applicable
(3) Is the company's physical sales income greater than the labor income?
□ Yes √ No
(4) Performance of major sales contracts signed by the Company as of the reporting period
□ Applicable √ Not applicable
(5) Operating Cost Structure
Industry Classification
Unit: RMB
Industry Classification | Item | 2020 | 2019 | Year-on-year increase or decrease | ||
Amount | Proportion to Operating Cost | Amount | Proportion to Operating Cost | |||
I. Culture and Art Industry - Live Performance | Cost of live performance | 341,549,955.68 | 96.85% | 474,975,419.72 | 63.57% | -28.09% |
II. Culture and Art Industry - Performance on Internet | Performance cost on internet | 170,265,034.42 | 22.79% | -100.00% | ||
III. Tourism Service Industry | Cost of tourism service industry | 11,120,517.74 | 3.15% | 101,948,847.10 | 13.64% | -89.09% |
NoteN/A
(6) Has the scope of consolidation changed during the reporting period?
√ Yes □ No
There are 5 newly merged units in this period, the reasons are:
New Merged Units This Year | Investment Ratio | Notes |
Zhuhai Songcheng Performance Kingdom Co., Ltd | 100% | New in 2020 |
Zhuhai Southern Film and Television Cultural Industry Co., Ltd. | 100% | Acquire 100% equity in 2020 |
Zhuhai Huayin Landscaping Co., Ltd. | 55% | 55% holding subsidiary affiliated Zhuhai Southern Film and Television Cultural Industry Co., Ltd. acquired in 2020 |
Songcheng Brand Management Co., Ltd. | 100% | New in 2020 |
Romance Show Management Co., Ltd. | 100% | New in 2020 |
In the current period, the number of merged units was reduced by 2 due to:
Reduced Merged Units This Year | Investment Ratio | Notes |
Hangzhou Songcheng Art Troupe Co., Ltd. | 100% | Canceled in 2020 |
Zhejiang Songcheng Entertainment Culture Co., Ltd. | 100% | Canceled in 2020 |
(7) Major changes or adjustments to the company's business, products, or services during the reporting period
□ Applicable √ Not applicable
(8) Major Clients and Suppliers
The Company's Major Clients
Total sales amount of the top five customers | 295,250,820.97 |
Proportion of the total sales amount of the top five customers to the total annual sales | 32.71% |
Proportion of the total sales amount of the related parties in the top five customers to the total annual sales | 0.00% |
Profiles of the Company's top five customers
No. | Name of customer | Sales amount (yuan) | Proportion to the annual sales |
1 | Customer I | 128,933,962.27 | 14.28% |
2 | Customer II | 50,414,308.38 | 5.59% |
3 | Customer III | 39,108,962.22 | 4.33% |
4 | Customer IV | 38,845,104.50 | 4.31% |
5 | Customer V | 37,948,483.60 | 4.20% |
Total | -- | 295,250,820.97 | 32.71% |
Other Information Notes for Major Clients
□ Applicable √ Not applicable
(8) Major suppliers
Total Purchase Amount of Top Five Suppliers (yuan) | 397,247,387.85 |
Proportion of the total purchase amount of top five suppliers to the total annual purchase amount | 34.73% |
Proportion of the total purchase amount of the related parties in top five suppliers to the total annual purchase amount | 0.00% |
Profiles of the Company's top five suppliers
No. | Supplier Name | Purchase amount (yuan) | Proportion to the total annual purchase amount |
1 | Supplier I | 147,103,879.82 | 12.86% |
2 | Supplier II | 106,202,799.73 | 9.28% |
3 | Supplier III | 57,800,000.00 | 5.05% |
4 | Supplier IV | 49,683,318.00 | 4.34% |
5 | Supplier V | 36,457,390.30 | 3.19% |
Total | -- | 397,247,387.85 | 34.73% |
Other Information Notes for Major Suppliers
□ Applicable √ Not applicable
3. Expenses
Unit: RMB
2020 | 2019 | Year-on-year increase or decrease | Statement on Significant Changes | |
Sales Expenses | 63,649,750.30 | 145,503,636.64 | -56.26% | Mainly due to the impact of the epidemic and Huafang Technology is no longer included in the scope of consolidation |
Administration expenses | 288,084,167.74 | 188,215,121.23 | 53.06% | Mainly due to the closure of various scenic spots of the Company during the epidemic, and the adjustment of operating costs during the closed period to this item |
Financial Expenses | -12,843,438.15 | -17,743,898.84 | 27.62% | Mainly due to the increase in bank loan interest and exchange gains and losses |
Research and development expense | 37,487,964.00 | 48,424,520.54 | -22.58% | Mainly due to the fact that Huafang Technology is no longer included in the scope of consolidation |
4. R&D Investment
√ Applicable □ Not applicable
During the reporting period, the Company invested RMB 37,488,000 in research and development, mainly input in newtechnologies to improve the stage effect, the background control system, the production of VR content, and upgrade of the ticketingsystem. In the light of consistency and prudence, the Company's R&D investment is fully included in the current profit and losswithout capitalization.The Company's R&D investment in the past three years and its percentage in operating income
2020 | 2019 | 2018 | |
Number of R&D personnel | 253 | 252 | 326 |
Percentage of R&D personnel | 17.56% | 17.37% | 19.09% |
R&D investment (yuan) | 37,487,964.00 | 48,424,520.54 | 70,567,576.48 |
The proportion of R&D investment to operating income | 4.15% | 1.85% | 2.20% |
Capitalized amount of R&D expenditure (yuan) | 0.00 | 0.00 | 0.00 |
Percentage of capitalized R&D expenditure in R&D investment | 0.00% | 0.00% | 0.00% |
Percentage of capitalized R&D expenditure in current net profit | 0.00% | 0.00% | 0.00% |
The reason for the significant change in the proportion of the total amount of R&D investment to operating income compared withlast year
□ Applicable √ Not applicable
Reasons and rational explanations on the substantial change in capitalization rate of R&D investment
□ Applicable √ Not applicable
5. Cash Flow
Unit: RMB
Item | 2020 | 2019 | Year-on-year increase or decrease |
Subtotal of cash inflow from operational activities | 943,790,117.88 | 3,146,681,409.32 | -70.01% |
Subtotal of cash outflow from operational activities | 549,848,217.94 | 1,575,229,909.81 | -65.09% |
Net cash flow generated by operating activities | 393,941,899.94 | 1,571,451,499.51 | -74.93% |
Subtotal of cash inflow from investment activities | 1,351,939,517.27 | 1,939,481,747.40 | -30.29% |
Subtotal of Cash Outflow from Investment Activities | 2,292,941,086.10 | 3,120,852,903.60 | -26.53% |
Net amount of cash flow generated by investment activities | -941,001,568.83 | -1,181,371,156.20 | 20.35% |
Subtotal of cash inflow from financing activities | 420,000,000.00 | 13,500,000.00 | 3,011.11% |
Subtotal of cash outflow from financing activities | 306,917,837.81 | 174,312,936.00 | 76.07% |
Net cash flow generated by financing activities | 113,082,162.19 | -160,812,936.00 | 170.32% |
Net additions to balance of equivalents | -443,933,773.37 | 231,761,674.88 | -291.55% |
Description of the main factors affecting the significant changes in related data over the same period of last year
√ Applicable □ Not applicable
During the reporting period, the subtotals of cash inflows and outflows from operating activities, and the net cash flows fromoperating activities decreased by 70.01%, 65.09%, and 74.93% respectively year-on-year, mainly due to the impact of the epidemicand the fact that Huafang Technology is no longer incorporated into the scope of the Company's consolidation.During the reporting period, the subtotals of cash inflow and outflow from investment activities decreased by 30.29% and
26.53% respectively year-on-year, mainly due to the year-on-year decrease in the Company's purchase and redemption of financialproducts.
During the reporting period, the subtotal of cash inflow from financing activities increased by 3011.11% year-on-year, mainlydue to the increase in the Company's bank loans and the receipt of capital contributions from shareholders by Xi'an Romance ShowCompany.
During the reporting period, the subtotal of cash outflows from financing activities increased by 76.07% year-on-year, mainlydue to the year-on-year increase in the Company's repayment of bank loans and dividend distribution.
Reasons for the significant difference between the net cash flow generated by the company's operating activities in thereporting period and the net profit in the current year
√ Applicable □ Not applicable
Supplementary information | Amount of this period |
1. Reconciliation of net profit to cash flows from operational activities: | |
Net Profit | -1,766,945,878.00 |
Plus: Credit impairment loss | 32,739,976.91 |
Provision for Impairment of Assets | 1,877,720,155.72 |
Depreciation of fixed assets | 201,385,250.67 |
Amortization of Intangible Assets | 56,669,812.67 |
Amortization of long-term prepaid expenses | 35,034,022.89 |
Losses on disposal of fixed assets, intangible assets and other long-term assets (mark "-" for incomes) | -676,435.92 |
Losses on scrapping of fixed assets (mark "-" for incomes) | 38,302,318.05 |
Losses on fair value changes (mark "-" for incomes) | -247,726.31 |
Financial expenses (mark "-" for incomes) | 17,775,739.48 |
Losses on investment (mark "-" for incomes) | -14,014,892.30 |
Decrease on deferred income tax assets (mark "-" for increases) | -9,318,905.44 |
Increase on deferred income tax liabilities (mark "-" for decreases) | -3,137,428.24 |
Decrease on inventories (mark "-" for increases) | -1,993,817.28 |
Decrease on operational receivables (mark "-" for increases) | -44,275,900.28 |
Increase on operational payables (mark "-" for decreases) | -25,074,392.68 |
Others | |
Net cash flow generated by operating activities | 393,941,899.94 |
III. Non-Core Business
√ Applicable □ Not applicable
Unit: RMB
Amount | Percentage of Total Profit | Reason | Sustainability | |
Investment Income | 14,014,892.30 | -0.81% | Mainly due to long-term equity investment and financial income calculated by the equity method | Yes |
Changes in fair value gains and losses | 247,726.31 | -0.01% | No | |
Asset Impairment | -1,910,460,132.63 | 109.98% | Mainly due to the impairment of the long-term equity investment of Huafang Technology held by the Company | No |
Non-operating Revenue | 3,242,377.14 | -0.19% | No | |
Non-Operating Expenses | 41,007,879.43 | -2.36% | Mainly due to the Company's scenic upgrades and renovations | No |
IV. Analysis of Assets and Liabilities
1. Significant changes in assets composition
Since 2020, the Company implemented new revenue standards and new leasing standards for the first time, and adjusted the itemsrelated to financial statements at the beginning of the year.Applicable
Unit: RMB
End of 2020 | Early 2020 | Proportion increase and decrease | Statement on Significant Changes | |||
Amount | Proportion To Total Assets | Amount | Proportion To Total Assets | |||
Cash and Bank Balances | 1,337,776,253.98 | 14.55% | 1,785,124,821.87 | 16.17% | -1.62% | |
Accounts receivable | 5,887,012.36 | 0.06% | 5,337,855.43 | 0.05% | 0.01% | |
Inventory | 13,424,146.50 | 0.15% | 6,110,221.56 | 0.06% | 0.09% |
Long-term Equity Investment | 1,534,539,625.11 | 16.69% | 3,468,596,165.08 | 31.42% | -14.73% | Mainly due to the impairment of the long-term equity investment of Huafang Technology held by the Company |
Fixed Assets | 2,508,754,929.16 | 27.28% | 2,311,251,277.89 | 20.93% | 6.35% | Mainly due to the transfer of the Company's project in construction into fixed assets |
Projects under Construction | 771,871,563.73 | 8.39% | 370,000,233.10 | 3.35% | 5.04% | Mainly due to increased input in the Company's projects in construction |
Long-term loan | 282,000,000.00 | 3.07% | 0.00% | 3.07% | Mainly due to increase in the Company's bank loans |
2. Assets and liabilities measured at fair value
√ Applicable □ Not applicable
Unit: RMB
Item | At the beginning of the reporting period | Changes in fair value gains and losses in the current period | Cumulative fair value changes in equity | Impairment loss of the reporting period | Purchase amount of the reporting period | Sales amount of the reporting period | Other variations | At the end of the reporting period |
Financial Assets | ||||||||
1. Trading financial assets (excluding derivative financial assets) | 854,108,086.54 | -4,999,569.16 | 814,776,184.30 | 1,354,628,734.60 | 19,371,860.52 | 328,627,827.60 | ||
2. Derivative financial assets | 6,589,730.08 | 6,589,730.08 | ||||||
3. Other credit investments | ||||||||
4. Investment in other | 300,959,931.64 | -76,693,334.90 | 224,266,596.74 |
equity instruments | ||||||||
Subtotal of financial assets | 1,155,068,018.18 | 1,590,160.92 | -76,693,334.90 | 814,776,184.30 | 1,354,628,734.60 | 19,371,860.52 | 559,484,154.42 | |
Total | 1,155,068,018.18 | 1,590,160.92 | -76,693,334.90 | 814,776,184.30 | 1,354,628,734.60 | 19,371,860.52 | 559,484,154.42 | |
Financial liabilities | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
Note: ① Changes in fair value recognized in profit or loss for the current period are 1,590,160.92 yuan, which is composed of
changes in fair value recognized in profit or loss of 247,726.31 yuan and converted difference in foreign currency statementsof 1,342,434.61 yuan; ② Other changes are accumulated investment income.Are there any significant changes in the measurement attributes of the company's main assets during the reporting period?
□ Yes √ No
3. Restrictions on asset rights as of the end of the reporting period
As of the end of the reporting period, the Company's main assets were not seized, frozen, mortgaged or pledged.V. Investment analysis
1. Overview
√ Applicable □ Not applicable
Investment In The Reporting Period (RMB) | Investment Over The Corresponding Period Of Last Year | Rate Of Change |
2,159,030,550.7 | 2,680,647,888.78 | -19.46% |
2. Significant equity investments acquired during the reporting period
√ Applicable □ Not applicable
Unit: RMB
Invested Company Name | Main businesses | Investment Mode | Investment Amount | Shareholding Percentage | Capital Source | Partner | Investment Period | Product type | Progress as of Balance Sheet Date | Anticipated Income | Current Investment Profit and Loss | Involved in a Lawsuit | Disclosing Date (If Any) | Disclosing Index (If Any) |
Zhuhai Southern Film and Television Cultural Industry Co., Ltd. | Project development, operation and management of film and television industry; | Acquisition | 378,000,000.00 | 100.00% | Equity Fund | N/A | Long-term | Film and television culture | Completed | 0.00 | -16,469,469.80 | No |
Invested Company Name | Main businesses | Investment Mode | Investment Amount | Shareholding Percentage | Capital Source | Partner | Investment Period | Product type | Progress as of Balance Sheet Date | Anticipated Income | Current Investment Profit and Loss | Involved in a Lawsuit | Disclosing Date (If Any) | Disclosing Index (If Any) |
development, operation and management of tourism projects; real estate development; business services and commercial wholesale and retail | ||||||||||||||
Total | -- | -- | 378,000,000.00 | -- | -- | -- | -- | -- | -- | 0.00 | -16,469,469.80 | -- | -- | -- |
3. Major non-equity investments underway during the reporting period
□ Applicable √ Not applicable
4. Financial assets at fair value
√ Applicable □ Not applicable
Unit: RMB
Asset Class | Initial Investment Cost | Changes in fair value gains and losses in the current period | Cumulative fair value changes in equity | Amount purchased during the reporting period | Amount sold during the reporting period | Cumulative investment income | Amount at the end of the period | Capital Source |
Fund | 110,024,148.79 | -538,080.75 | 103,776,184.30 | 40,362,625.24 | -454,248.84 | 172,445,378.26 | Temporarily idle own funds | |
Financial Derivatives | 6,589,730.08 | 6,589,730.08 | Temporarily idle own funds | |||||
Other (Bank Financial Products) | 744,083,937.75 | -4,461,488.41 | 711,000,000.00 | 1,314,266,109.36 | 19,826,109.36 | 156,182,449.34 | Temporarily idle own funds | |
Total | 854,108,086.54 | 1,590,160.92 | 0.00 | 814,776,184.30 | 1,354,628,734.60 | 19,371,860.52 | 335,217,557.68 | -- |
Note: The current fair value change in profit and loss in the table is 1,590,160.92 yuan, which is composed of the fair value changein profit and loss of 247,726.31 yuan and the converted difference in foreign currency statements of 1,342,434.61 yuan.
5. Utilization of raised funds
□ Applicable √ Not applicable
No use of funds in the reporting period of the CompanyVI. Major Assets and Equity Sales
1. Major assets sales
□ Applicable √ Not applicable
No major assets sales in the reporting period of the Company
2. Major equity sales
□ Applicable √ Not applicable
VII. Analysis of Major Subsidiaries and Investees
√ Applicable □ Not applicable
Major subsidiaries and joint-stock companies with a net profit impact of over 10%.
Unit: RMB
Company Name | Company Type | Main businesses | Registered Capital | Total Assets | Net Assets | Operating income | Operating Profit | Net Profit |
Sanya Romance Tourism Performance Co., Ltd. | Subsidiary Company | Theme park + Art performance | 490,000,000.00 | 934,587,240.66 | 898,931,442.88 | 127,098,246.23 | 79,054,679.57 | 69,002,874.47 |
Lijiang Chama Ancient City Tourism Development Co., Ltd. | Subsidiary Company | Theme park + Art performance | 250,000,000.00 | 606,265,695.91 | 579,980,699.81 | 136,520,949.23 | 74,962,536.68 | 62,836,710.80 |
Songcheng Tourism Development Co., Ltd. | Subsidiary Company | Tourism resource development, tourism planning and design, artistic creation, brand and marketing planning of tourist attractions | 50,000,000.00 | 709,296,365.59 | 416,014,324.88 | 168,821,226.38 | 163,040,087.48 | 162,911,596.90 |
Beijing Huafang Technology Co., Ltd. (formerly known as Beijing | Joint stock company | Internet information service, performance brokerage business, | 53,333,333.00 | 1,882,542,983.27 | 1,503,710,234.65 | 3,777,442,691.41 | 9,844,199.94 | -10,799,124.63 |
Six Rooms Technology Co., Ltd.) | business on music entertainment products through information network, competition activities |
Major holding companies and joint stock companies;
1. The report data of Beijing Huafang Technology Co., Ltd. (formerly known as Beijing Six Rooms Technology Co., Ltd.) ispresented on the basis of the fair value of the investee's identifiable assets and liabilities when the investment is obtained.
2. This year, the Company made 1,861,297,284.90 yuan of impairment provision for the long-term equity investment in BeijingHuafang Technology Co., Ltd.Acquisition and disposal of subsidiaries during the reporting period
√ Applicable □ Not applicable
Company Name | Method of acquisition and disposal of subsidiaries during the reporting period | Impact on overall production management and performance |
Zhuhai Songcheng Performance Kingdom Co., Ltd | New in 2020 | |
Zhuhai Southern Film and Television Cultural Industry Co., Ltd. | Acquire 100% equity in 2020 | |
Zhuhai Huayin Landscaping Co., Ltd. | A 55% holding subsidiary of Zhuhai Southern Film and Television Culture Industry Co., Ltd. acquired in 2020 | |
Songcheng Brand Management Co., Ltd. | New in 2020 | |
Romance Show Management Co., Ltd. | New in 2020 | |
Hangzhou Songcheng Art Troupe Co., Ltd. | Canceled in 2020 | |
Zhejiang Songcheng Entertainment Culture Co., Ltd. | Canceled in 2020 |
VIII. The structured entity controlled by the Company
□ Applicable √ Not applicable
IX. Prospects for the Future Development of the Company
At the beginning of 2020, the COVID-19 pandemic swept across the world, taking a considerable toll on the social order andeconomic operation of all the countries, especially the entertainment and service industries. As a pioneer in the nation's culturaland tourism industry, the Company closed all the scenic spots since January 24 under the call the CPC and government. Until the fullresumption on June 12, financial impact is inevitable due to business suspension and recovering of the industry chain.
After 20 years of development, the Company has experienced difficult times such as the Southeast Asian financial crisis, SARS,and the 2008 financial crisis. The history shows that every crisis is a rare development opportunity, especially for companies that are
prepared. After this epidemic, competitors with weak financial strength will fail, those lacking creative ability will lose more shares,and new comers will become more cautious. As a subsequent result, the competition pattern in the industry will be more favorableto the Company.As the downward trends of the cultural and travel industry slid as a result of the epidemic, the Company is more aware of itsown position and weak links in the industry. During the epidemic, the Company upgraded hardware against the difficult time, triedthe performing arts kingdom model, and achieved initial results. In the future, the Company will unswervingly transform andupgrade itself to a performance platform company, and think from the perspective of social communication, internet, and users.Connecting upstream and downstream sectors, it will build a new value ecology and industry order, and absorb more diversifiedprofessional talents. Meanwhile, a variety of economic components will be developed to constantly activate the creativity andvitality of the Company, making it a more vibrant and imaginative company.
(I) Overview of industry backgroundIn 2020, the entire cultural and tourism industry was hit hard by the COVID-19 epidemic, and many were pushed on the vergeof bankruptcy. According to the National Bureau of Statistics, there were 2.88 billion domestic tourists in 2020, a decrease of 52.1%from the previous year. Domestic tourism revenue was 2,228.6 billion yuan, down by 61.1%. The Blue Book of Chinese TourismEconomics (NO.13), issued by the China Tourism Academy (Data Center of the Ministry of Culture and Tourism), estimated that thenumber of domestic tourists in 2021 will recover to 68.3% of 2019 and the revenue of domestic tourism will recover to 57.6% of2019.
As the epidemic is gradually under control with expanding vaccination, the cultural and tourism industry is slowly recovering,and market data is increasing, especially that on domestic tourism. Being the epidemic is still prevalent in other countries, outboundtravel will continue to be restricted. It is expected that the internal circulation of tourism and the return of tourism consumption willcontinue to be the main trend of the industry in the future. In the post-epidemic era, demand-side trends of the industry are asfollows:
1. Rising consumption of Generation Z
Generation Z refers to the "indigenous people" of internet born between 1995 and 2009. They grew up with computers,smartphones, and instant messaging software, carrying features of circle cultures, ACG, and niche preference. According to theNational Bureau of Statistics, the total population of Generation Z in the Chinese mainland is about 260 million, accounting forabout 20% of the total population. The generation is the main group of consumption upgrades with frequent consumption intourism. According to the survey data of Mafengwo, 45.3% of Generation Z people travel 2-3 times a year, and 12.4% travel morethan 4 times. The proportions are much higher than those of other age groups, and nearly half of the respondents said that theepidemic has a small impact on tourism consumption and will maintain their previous level of consumption in tourism after theepidemic.
The rise of Generation Z is an iterative update of new consumer demand and group culture, and it also brings new economictrends. In 2021, for the cultural and tourism industry hit by the COVID-19, seizing Generation Z is to grasp the incremental marketfor new cultural and tourism consumption in the post-epidemic era. The ability to accurately capture the travel consumptionpreferences of Generation Z is the key to success.
2. Rising popularity of surrounding travel
Long-distance travel is relatively restricted during the recovery period of the epidemic, the popularity of travel around thecities will continue to increase and exist for a long time. Overlapped with the demand back from outbound travel, the surroundingtourism markets of the Yangtze River Delta, Pearl River Delta, Beijing-Tianjin-Hebei and other core tourist source areas areexpanding significantly. According to the research report of the China Tourism Academy, in the post-epidemic era, tourists of various
scenic spots mainly come from within the province. Urban one-day trips and suburban tours have recovered and the proportion ofself-driving trips has increased. Self-guided family tours have become the main market contributor. The in-depth exploration andrepeated consumption of the population in the core cities around the scenic spot will become one of the important tasks of themarket.
3. Tourism consumption from lower-level regions
According to data from the National Bureau of Statistics, in recent years, the growth rate of per capita consumptionexpenditure in rural areas was higher than that of urban residents, indicating that rural residents also begun to have more potentialfor consumption. The growth rate of domestic tourist arrivals and consumption of rural residents has shown an upward trend inrecent years, while that of urban residents has declined. The decline of domestic cultural and tourism consumption to third-tier andfourth-tier cities and towns is also related to the more balanced development of the economic level, which will become a long-termtrend.
The Company’s performing arts kingdom model caters to the current consumption needs of Generation Z from the contentside; special events such as summer night tours to meet the surrounding tourism market; the high, medium and low product systemto cope with cultural and tourism consumption from lower-level regions, and the work done during the reporting period closelyfocused on the current changes in market trends.
(II) Development strategy planning of the Company
After more than 20 years of development, the Company has established a relatively large competitive advantage in scale,market, marketing, technology, brand and industry status. In the future, tourism and cultural industries will face unprecedenteddevelopment opportunities in consumption upgrades. To meet market challenges and seize industry development opportunities,the Company will adhere to the differentiated and centralized development strategy, give full play to its creative and innovativecapabilities, strengthen development and application of new technologies, continue to make breakthroughs in innovative businessforms, and maintain integrated development. While consolidating its foundation in the performing arts, the Company will seekanother leapfrog development to bring its value to a new level.
1. Adhere to differentiation and centralized development
The Company will adhere to the differentiated competition strategy, uphold the banner of "performing arts", and strengthenthe development mode of "theme park + cultural performance", to avoid homogenous competition with other types of theme parks;value application of technological innovation to cater to the needs of young people; give full play to creativity to increase attractionand improve experiences of performance content.
It will remain committed to the strategy of centralized development, and focus on the layout in first-line tourism destinationsand live entertainment fields related to performing arts; remian within its ability circle to avoid excessive development, and staycautious in diversification.
2. Attention to creativity and innovation
Innovation is the lifeblood of the Company and only internal creativity can build a century-old Songcheng. The Company, basedon market direction, will adhere to performing arts as the core, and focus on experience. Starting from planning, it will continue tostrengthen the core competitiveness of "performance", and integrate innovation into planning and design, interactive experience,theater matrix, performance content and market planning.
3. Drive innovation in live performance with technology
Technological innovation is a powerful tool to promote the transformation and by upgrading the cultural industry and achieve
high-quality development. Technology is playing an increasingly important role in performance effects and the audience experience.The combination of cutting-edge stage machinery, lighting, sound, and smart equipment will realize the coexistence of the real andvirtual worlds on the same stage/scene, and enhance visitors/audience's experience of the real world while bringing themunperceivable feelings. In addition, live entertainment with a strong sense of immersion will innovate the overall entertainmentexperience.
4. Breakthroughs in business forms
The Company has become an industry leader in tourism and performing arts. That is not enough, it is actively exploringinnovative models, thereby enhancing social contributions. "Tourism performance + urban performance" is advancing, and theconstruction of a performing arts kingdom will make it to penetrate from mass tourism to segmented population markets. TheCompany will constantly challenge itself to seek a broader market scale and greater development segment. In the construction ofthe Shanghai project, multiple shows and diversified ticket combinations will be introduced based on the Romantic Show, extendingits services to tourist groups, locals and those from close regional markets.
5. Committed to integrated development
The current corporate governance has created greater possibilities for the Company's resource integration and groupoperations. Integrated development is a powerful weapon to improve combat capabilities and achieve strategic goals. In the future,the Company will be committed to integration of tourism and cultures, cultures and technology, independent investment and lightassets, entertainment and vacation, marketing and planning, products and markets, contents and platforms, consumers andproducers, theme scenic spots and performing arts kingdom, as well as internet and the capital market.
6. Platform-based strategy for performance
The epidemic has resulted in negative impact to the industrial chain and structure, but also gave birth to new opportunities.The Company is considering to become a platform for industry accumulation, to gather the industrial chain shattered by theepidemic and that squeezed out by urbanization on the Company's platform. That includes, for example, professional equipment,various studios, performing talents and drama platforms, performance management and output, ticketing and international artexchange platform. The Company will be built into a platform for social communication of young people, family gatherings, theelderly, and relaxing for business people. It is also a communication platform for various artists and art categories.
(III) Work plan in 2021
Since the outbreak of the epidemic, the Company has focused on recovery strategy and economy. After years of development,the Company has formed strong capital strength and brand influence, rich intellectual resources and significant competitiveadvantages. It has stronger anti-risk capabilities and a better development foundation than ever before. Through systematic review,consideration and preparation, the Company is full of confidence and enthusiasm, and is ready for the market repair and furtherdevelopment after the epidemic is over.
1. Development of Shanghai project
2021 is the first year of the nation's 14th Five-Year Plan and also the 25th anniversary of the establishment of SongchengGroup, an important milestone for the Company's development. The Shanghai project is a key node to link the past and present.,and is also an important stage for Songcheng to further consolidate and establish its top position in performance in the world. TheCompany will be more tolerant and open while leveraging its closed-loop advantages. Songcheng in Shanghai will become a richplatform for exchanges of various art forms and a platform for live entertainment. In the future, the Shanghai project, with itslocation advantages, will carry out various activities like performances, festivals, exhibitions, and IP exhibitions through self-madeshows, customization, introduction, cooperation, and sharing. It will continuously expand circles and influence, and complete the
three-dimensional concept of the performance kingdom, while laying a solid foundation for its replication.
2. Upgrade of existing projects
The continuous improvement of existing projects is conducive to better product quality and user experience. The Company willcontinue to renovate and upgrade existing projects by expanding and renewing travel routes, adding various types of indoor andoutdoor theaters and shows, and adding popular sites and rest areas. The new changes will increase return visitor attendancepotential.
3. Establish a hierarchical system for high-end, medium-end and low-end products
For the core projects of "Romantic show", some adjustments were made to the "Romantic Show" in Sanya, Xi'an and otherplaces to extract in-depth new cultural elements, and integrate more stage expressions; the introduction of "Love in" and "Color",different from the "Romantic Show" series, presents culture in a newer and purer form; the existing outfield performances werealso improved, and the features of the scenic spot were fully used to make a point-line-field presentation layout of outfieldperformances, namely a system in which tourists can watch the shows and participate in immersive interactions. The differentiationin the market will not only deepen the type and quality of Songcheng's performance product line, but also further consolidate itsthe core position in the local tourism and performance market.
4. Promotion of projects in Foshan, Xitang and Zhuhai
The projects in Foshan and Xitang are the continuation of the Romantic Show product line in the Yangtze River Delta and thePearl River Delta. The Company will ensure the steady progress of various projects and accelerate the construction. As a flagshipproduct in the future, the Zhuhai project has generated high expectations for the Company, and it will invest accordingly to theplanning and design, engineering construction, and artistic creation to ensure that the Zhuhai project will become a world-classentertainment destination for performing arts.
5. Continue to strengthen marketing
The Company will penetrate into low-level regions to consider local cultural and market features, and establish a differentiatedmarket mechanism according to different tourist destinations; strengthen overall layout of channels in each scenic spot marketbased on the introduction of visitor flow, and build an intensive marketing network through online and offline marketing channels incombination with point, line and field; Combine reshaping of the brand, event marketing and precise placement, to make a goodjob in the promotion and comprehensive marketing of each project; innovate the promotion mode and find suitable partners andinternet celebrities, strengthen the use of short videos and We media, and activate the promotion of young people on We media.
6. Improve mechanism and talent structure
The Company will focus on three key points in building a talent system in 2021:
(1) Introduction: Fully research the talents required by the post, and identify the features of talents required by different posts.Introduce high-level talents and establishment a talent pool of Songcheng through external introduction and internal exploration;expand contacts for professional posts to provide talent support for the Company's innovation strategy.
(2) Use of talents: Today, realizing self-value has become the demand of most young employees. Based on this, the Companywill combine the situation of talents and posts to set up jobs that meet employees' ability development and expectations, andenable them to achieve self-satisfaction and self-realization while gaining sufficient growth. In addition, a variety of incentivechannels such as joint systems and performance, as well as warm and effective communication will bind talents to promote theirsustainable development.
(3) Cultivation: Build a stage for outstanding talents to display their skills and expand their horizons, help them go beyond
limitations of the original work and give full play to their ability. The Company will implement a training plan for Songcheng'shigh-potential talents, integrate and upgrade the existing talent training system, putting talent and the Company on the same pagein transformation and development.X. Registration Form for Reception of Research, Communication, Interviews and Other Activities
1. Registration Form for reception of research, communication, interviews and other activities during thereporting period
√ Applicable □ Not applicable
Reception Time | Reception location | Reception Method | Reception target type | Reception objects | Main content of the discussion and the information provided | Index of the basic information of research |
August 8, 2020 | Company meeting room | Field Investigation | Institution | Brokerage researcher and fund company manager | Business introduction in first half of the year and Q&A | For details, please refer to the "Record of Investor Relations Activities on August 8, 2020" announced by the Company on http://www.cninfo.com.cn on August 10, 2020. |
October 29, 2020 | Company meeting room | Field Investigation | Institution | Brokerage researcher and fund company manager | Business introduction in Q3 and Q&A | For details, please refer to the "Record of Investor Relations Activities on Thursday, October 29, 2020" announced by the Company on http://www.cninfo.com.cn on Sunday, November 1, 2020. |
Section V Significant EventsI. Distribution of Common Stock Profits of the Company and Capitalization of Capital ReservesDistribution policies of the common stock profits during the reporting period, especially the formulation, implementation oradjustment of the cash dividend policies
√ Applicable □ Not applicable
Reviewed and approved at the 6th meeting of the 7th Board of Directors held on April 27, 2020 and at the annualshareholders' meeting for 2019 held on May 18, 2020, the company's plan for profit distribution in 2019 was: Taking the total sharecapital of 1,452,607,800 shares of 2019 as the basis, RMB 2.00 (tax included) of dividend for every 10 shares was distributed to allthe shareholders, with a total amount of cash dividend of RMB 290,521,560 and 8 shares capitalized from the capital reserves weredistributed to all the shareholders for every 10 shares, with a total number of 1,162,086,240 shares. After capitalization, the totalshare capital amounted to 2,614,694,040 shares. During the reporting period, the Company has completed the equity distribution.The equity registration date: May 28, 2020 and the date of exclude right (XR) and exclude dividend (DR): May 29, 2020.
Special notes on cash dividend policies | |
Whether they comply with the requirements of the Company's articles of incorporation or the resolutions of the General Meeting of Shareholders: | Yes |
Whether the dividend standards and proportions are distinct and clear: | Yes |
Whether the relevant decision-making procedures and mechanisms are complete: | Yes |
Whether the independent directors performed their duties and played their due role: | Yes |
Whether the minority shareholders have the opportunity to fully express their opinions and appeals, and whether their legitimate rights and interests have been fully protected: | Yes |
Whether relevant conditions and procedures are compliant and transparent when the cash dividend policies are being adjusted or changed: | Not applicable. |
The plan for profit distribution and capitalization of capital reserves during the reporting period is consistent with relevantprovisions in the articles of association and dividend management measures of the Company
√ Yes □ No □ Not applicable
The plan for profit distribution and capitalization of capital reserves during the reporting period is in compliance with relevantprovisions in the articles of association of the Company.Profit distribution and capitalization of capital reserves in the current year
Number of bonus shares per 10 shares (shares) | 0 |
Number of dividend payout per 10 shares (RMB) (tax included) | 0.5 |
Number of capitalized shares per 10 shares (shares) | 0 |
Equity base in the distribution preplan (shares) | 2,614,694,040 |
The amount of cash dividends (yuan) (including tax) | 130,734,702.00 |
The amount of cash dividends (yuan) in other ways (such as share repurchase) | 0.00 |
The total amount of cash dividends (including in other ways) (yuan) | 130,734,702.00 |
Distributable profits (RMB) | 3,132,049,591.95 |
The ratio of the total amount of cash dividends (including in other ways) to the total amount of profit distribution | 100.00% |
Latest cash dividend | |
If the Company's development stage is not easy to define but there are significant capital expenditure arrangements, when the profits are being distributed, the proportion of the cash dividends in this profit distribution should be at least 20% | |
Details of the preplans on profit distribution or capitalization of capital reserves | |
Audited by BDO China Shu Lun Pan CPAs (special general partnership), the net profit attributable to the shareholders of the listed company in 2020 was RMB -1,752,398,000. Based on the total share capital of 2,614,694,040 shares as at December 31, 2020, the Company distributed RMB 0.50 (tax included) of dividend for every 10 shares to all the shareholders, with a total cash dividend of RMB 130,734,702. |
The Company's common stock dividends distribution plan (preplan) and capital reserve capitalization plan (preplan) in the pastthree years (including this reporting period)The 2018 profit distribution plan: according to the resolution of 2018 annual shareholders' meeting, the Companyimplemented the 2018 profit distribution plan on May 15, 2019, which was: based on the total share capital of 1,452,607,800shares as at December 31, 2018, the Company distributed RMB 1.2 (tax included) of dividend for every 10 shares to all theshareholders, with a total cash dividend of RMB 174,312,900.The plan for profit distribution and capitalization of capital reserves of the Company in 2019: according to the resolution of2019 annual shareholders' meeting, the Company implemented the 2019 profit distribution plan on May 28, 2020, which was:
Taking the total share capital of 1,452,607,800 shares as at December 31, 2019 as the basis, RMB 2.00 (tax included) of dividend forevery 10 shares was distributed to all the shareholders, with a total cash dividend of RMB 290,521,560 and 8 shares capitalized fromthe capital reserves were distributed to all the shareholders for every 10 shares, with a total number of 1,162,086,240 shares. Uponsuch capitalization, the total share capital amounted to 2,614,694,040 shares.The 2020 profit distribution preplan: the 10th meeting of the 7th Board of Directors and the 8th meeting of the 7th Board ofSupervisors held by the Company on April 22, 2021 reviewed and approved the 2020 Profit Distribution Preplan. According to theAudit Report issued by BDO China Shu Lun Pan CPAs Co., Ltd (Xin Kuai Shi Bao Zi [2021] No. ZA11461), the Company achieved a netprofit attributable to the shareholders of listed companies in the amount of RMB -1,752,398,009.60 in 2020, plus the undistributedprofits at the end of the previous year in the amount of RMB 5,176,157,180.79, deduct the distributed dividends for 2019 in theamount of RMB 290,521,560.00 and add the retained earnings carried forward from other comprehensive income in the amount ofRMB -1,356,586.59, the actual distributable profit for shareholders in 2020 was RMB 3131881024.60. As at December 31, 2020, thebalance of capital reserves of the Company was RMB 1,211,364,214.86.Based on the total share capital of 2,614,694,040 shares at the end of 2020, the Company planned to distribute RMB 0.50 (taxincluded) of dividend for every 10 shares to all the shareholders, with a total cash dividend of RMB 130,734,702 in 2020.It is held by the Board of the Directors of the Company that although the epidemic impacted the performances of the Company,
the 2020 profit distribution plan proposed by the Company was consistent with the provisions concerning profit distribution in theCompany Law, the Circular of the CSRC on Further Implementation of the Matters Concerning Cash Dividends of the ListedCompanies, the Guideline No. 3 of the CSRC on Regulation of the Listed Companies - Cash Dividends of the Listed Companies, theArticles of Association, and other laws and regulations, and was legal ,compliant and reasonable in view of the Company'sconfidence for long-term development, for better consideration of both the immediate interests and long-term interests, inaccordance with the relevant provisions of the CSRC which encourage distribution of dividends and on the condition that thehealthy, sustainable development of the Company was guaranteed. The Company needs to submit the above plan to 2020 annualshareholders' meeting of the Company for review.The Company's cash dividends for common stocks in the past three years (including this reporting period)
Unit: RMB
Year | Cash dividend amount (tax included) | Net profit attributable to common stock shareholders of listed companies in the consolidated financial statement of the year for dividend distribution | The ratio of cash dividends to the net profit attributable to ordinary shareholders of listed companies in the consolidated statements | The amount of cash dividends in other ways (such as share repurchase) | The proportion of cash dividends in other ways to the net profit attributable to ordinary shareholders of listed companies in the consolidated statements | Total amount of cash dividends (including other ways) | The ratio of total amount of cash dividends (including other ways) to the net profit attributable to ordinary shareholders of listed companies in the consolidated statements |
2020 | 130,734,702.00 | -1,752,398,009.60 | -7.46% | 130,734,702.00 | -7.46% | ||
2019 | 290,521,560.00 | 1,339,790,994.94 | 21.68% | 290,521,560.00 | 21.68% | ||
2018 | 174,312,936.00 | 1,287,186,547.41 | 13.54% | 174,312,936.00 | 13.54% |
The Company's profits during the reporting period and the parent company's distribution of common stock shareholders' profits arepositive but a cash dividend distribution preplan for common stock is not proposed.
□ Applicable √ Not applicable
II. Performance of Commitments
1. Commitments made by the Company's controlling shareholders’, shareholders, related parties, purchasersand purchasing companies and have been fulfilled during the reporting period and those that have not beenfulfilled by the end of the reporting period
□ Applicable √ Not applicable
There are no commitments which should be fulfilled during the reporting period as promised by the Company's actualcontroller, shareholders, related parties, purchasers and purchasing companies and those that have not been fulfilled by the end ofthe reporting period.
2. If there is a profit forecast for the Company's assets or projects, and the reporting period is still within theprofit forecast period, the Company shall make an explanation on the fulfillment and its reasons
□ Applicable √ Not applicable
III. Occupation of the Capital of Listed Companies by Controlling Shareholders and Their RelatedParties for Non-operational Purposes
□ Applicable √ Not applicable
During the reporting period, there is no non-operational capital occupation over listed companies by controlling shareholdersand their related parties.
IV. Explanations Made by the Board of Directors on the Latest "Non-standard Audit Report"
□ Applicable √ Not applicable
V. Explanations Made by the Board of Directors, the Board of Supervisors and IndependentDirectors (If Any) on the "Non-standard Audit Report" from the Accounting Firm during theReporting Period
□ Applicable √ Not applicable
VI. Explanations Made by the Board of Directors on the Changes to the Accounting Polices andAccounting Estimates or the Corrections of Significant Accounting Error during the ReportingPeriod
√ Applicable □ Not applicable
1、 Changes in significant accounting policies
1) Implementation of "Accounting Standards for Business Enterprises No. 14 - Revenue" (revised in 2017) (hereinafter referredto as "New Revenue Standards")
The Ministry of Finance revised the "Accounting Standards for Business Enterprises No. 14 - Revenue" in 2017 The revisedstandards stipulate that for the first implementation of the standards, the amount of retained earnings and other related items inthe financial statements at the beginning of the year should be adjusted according to the cumulative effects, and the informationfor the comparable period should not be adjusted.
This Company implemented the new revenue standards since January 1, 2020. According to the standards, the company onlyadjusted the retained earnings and other related items in the financial statements at the beginning of the year 2020 for thecumulative effects of contracts that have not been completed on the date of first implementation, and the comparative financialstatements were not adjusted. These standards have the following major effects:
Content and Reasons for Change in Accounting Policies | Approval process | Statements Affected | Affected Amount of Balance on January 1, 2020 | |
Consolidated Subsidiaries | Parent company | |||
(1) The advance payments related to the contractual income are reclassified into the | The 6th meeting of the 7th Board of Directors | Received Prepayments | -311,838,903.34 | -731,628.89 |
contractual liabilities. | Contract liabilities | 294,302,487.38 | 710,319.31 | |
Other Current Liabilities | 17,536,415.96 | 21,309.58 |
Compared with the original revenue standards, implementation of the new revenue standards has the following effects on therelevant items of the financial statements in 2020 (increase/(decrease)):
Balance Sheets Items Affected | Affected Amount of Balance on Thursday, December 31, 2020 | |
Consolidated Subsidiaries | Parent company | |
Contract liabilities | 188,550,237.52 | |
Received Prepayments | -192,064,139.60 | |
Other Current Liabilities | 3,513,902.08 |
2) Implementation of "Accounting Standards for Business Enterprises Interpretation No. 13"
The Ministry of Finance issued the "Accounting Standards Interpretation for Business Enterprises No. 13" (CaiKuai [2019] No.21, hereinafter referred to as "Interpretation No. 13") on December 10, 2019, which came into force on January 1, 2020.Retrospective adjustment was not required.
① Identification of Related Parties
Interpretation No. 13 clarifies that the following circumstances constitute a related party: a joint venture or affiliated businessbetween an enterprise and other member units (including parent companies and subsidiaries) of the enterprise group to which itbelongs; a joint venture of the enterprise and other joint ventures or affiliated business. In addition, Interpretation No. 13 alsoclarifies that only two or more companies that are only significantly affected by one party do not constitute a related party. It alsoadds that affiliated business includes affiliated business and their subsidiaries, and joint ventures include joint ventures and theirsubsidiaries.
② Definition of Business
Interpretation No. 13 completes the three elements of business composition, refines the judgment conditions of businesscomposition, and at the same time introduces the "concentration ratio test" option to simplify to a certain extent the problemssuch as judgment of whether a combination obtained under the same control constitutes a business, etc.
The company implemented Interpretation No. 13 since January 1, 2020, and the comparative financial statements were notadjusted. The implementation of Interpretation No. 13 did not have significant impact on the company’s financial status andoperating results.
3) Implementation of the "Interim Provisions on Accounting Treatment of Carbon Emission Rights Trading"
On December 16, 2019, the Ministry of Finance issued the "Interim Provisions on Accounting Treatment of Carbon EmissionRights Trading" (CaiKuai [2019] No. 22), which is applicable to related companies in the key emission units (hereinafter referred toas key emission companies) which operate carbon emission rights trading business in accordance with the "Interim Measures forthe Management of Carbon emission Rights Trading”. This provision came into effect on January 1, 2020, and key emissioncompanies should adopt prospective application to apply this provision.
The company implemented this provision since January 1, 2020, and the comparative financial statements were adjusted. Theimplementation of this provision did not have significant impact on the company’s financial status and operating results.
4) Implementation of the "Provisions on accounting treatment of rent concessions related to COVID-19"
On June 19, 2020, the Ministry of Finance issued the "Provisions on accounting treatment of rent concessions related toCOVID-19" (CaiKuai (2020) No. 10), which came into effect on June 19, 2020, allowing companies to adjust related rent concessionsthat occurred between January 1, 2020 and the implementation date of this provision. According to this provision, for rentconcessions directly caused by COVID-19 that meet the conditions, for example, rent remission and deferred payment of rent,
companies can choose to adopt simplified methods for accounting treatment.The company adopts the simplified method for accounting all rent concessions within the scope the provision, and adjustedthe relevant rent concessions from January 1, 2020 to the date of implementation of the provision accordingly.
As the lessee, this Company adopted simplified methods for treatment of relevant rent concessions in order to write down theoperating costs, management expenses and sales expenses for the current period in the total amount of RMB 13,042,042.83.As the lessee, this Company adopted simplified methods for treatment of relevant rent concessions in order to write down theoperating costs for the current period, such rent simplification had no significant impact on the Company.
2. Changes in Significant Accounting Estimates
There were no changes in significant accounting estimates during the reporting period.
3. First implementation of the new revenue standards, and adjustment of related items of the financialstatements at the beginning of the year
Consolidated Balance Sheet
Item | Balance at the end of the previous year | Balance at the beginning of the year | Adjusted amount | ||
Re-classification | Re-measurement | Total | |||
Current Assets: | |||||
Cash and Bank Balances | 1,785,124,821.87 | 1,785,124,821.87 | |||
Deposit Reservation for Balance | |||||
Loans to Banks and Other Financial Institutions |
Trading Financial Assets | 854,108,086.54 | 854,108,086.54 | |||
Derivative Financial Assets | |||||
Note’s receivable | |||||
Accounts receivable | 5,337,855.43 | 5,337,855.43 | |||
Receivables Financing | |||||
Prepayments | 17,221,603.54 | 17,221,603.54 | |||
Premium Receivable | |||||
Reinsurance Accounts Receivable | |||||
Reinsurance Contract Reserves Receivable | |||||
Other Receivables | 125,573,266.78 | 125,573,266.78 | |||
Buying Back the Sale of Financial Assets | |||||
Inventory | 6,110,221.56 | 6,110,221.56 | |||
Contract Assets | Not applicable. | ||||
Holding for-sale assets | |||||
Non-current Assets Due within 1 Year | |||||
Other Current Assets | 127,570,975.96 | 127,570,975.96 | |||
Subtotal of Current Assets | 2,921,046,831.68 | 2,921,046,831.68 | |||
Non-current Assets: |
Item | Balance at the end of the previous year | Balance at the beginning of the year | Adjusted amount | ||
Re-classification | Re-measurement | Total | |||
Granting of loans and advances | |||||
Investment in Creditor's Rights | |||||
Investment in Other Creditor's Rights | |||||
Long-term Receivables | |||||
Long-term Equity Investment | 3,468,596,165.08 | 3,468,596,165.08 | |||
Investment in Other Equity Instruments | 300,959,931.64 | 300,959,931.64 |
Other Non-current Financial Assets | |||||
Investment Property |
Fixed Assets | 2,311,251,277.89 | 2,311,251,277.89 | |||
Projects under Construction | 370,000,233.10 | 370,000,233.10 | |||
Productive Biological Assets | |||||
Oil and gas assets | |||||
Intangible Assets | 1,498,490,129.82 | 1,498,490,129.82 | |||
Development Expenditure | |||||
Goodwill | 28,078,665.69 | 28,078,665.69 | |||
Long-term unamortized expenses | 112,440,627.02 | 112,440,627.02 | |||
Deferred Income Tax Assets | 9,148,452.39 | 9,148,452.39 | |||
Other Non-current Assets | 21,064,619.27 | 21,064,619.27 | |||
Subtotal of Non-current Assets | 8,120,030,101.90 | 8,120,030,101.90 | |||
Total Assets | 11,041,076,933.58 | 11,041,076,933.58 | - | ||
Current Liabilities: | |||||
Short-term loan | |||||
Borrowings from the Central Bank | |||||
Borrowings from Banks and Other Financial Institutions | |||||
Transactional financial liabilities | |||||
Derivative Financial Liabilities |
Notes Payable | |||||
Accounts Payable | 300,656,879.62 | 300,656,879.62 | |||
Received Prepayments | 351,733,456.28 | 39,894,552.94 | -311,838,903.34 | -311,838,903.34 |
Item | Balance at the end of the previous year | Balance at the beginning of the year | Adjusted amount | ||
Re-classification | Re-measurement | Total |
Contract liabilities | Not applicable. | 294,302,487.38 | 294,302,487.38 | 294,302,487.38 | |
Financial Assets Sold for Repurchase | |||||
Deposit Taking and Interbank Deposit | |||||
Receiving from Vicariously Traded Securities | |||||
Receiving from Vicariously Sold Securities | |||||
Payroll payable | 26,737,888.43 | 26,737,888.43 |
Tax Payable | 22,614,171.64 | 22,614,171.64 | |||
Other Payables | 63,299,348.02 | 63,299,348.02 | |||
Service Charge and Commission Payable | |||||
Reinsurance Accounts Payable | |||||
Holding for-sale liabilities | |||||
Non-current Liabilities Due within 1 Year |
Other Current Liabilities | 17,536,415.96 | 17,536,415.96 | 17,536,415.96 | ||
Subtotal of Current Liabilities | 765,041,743.99 | 765,041,743.99 | |||
Non-current Liabilities: | |||||
Insurance Contract Reserves | |||||
Long-term loan | |||||
Bonds Payable | |||||
Including: Preferred Stocks | |||||
Perpetual Bonds |
Long-term Payables | |||||
Long-term payroll payable |
Expected Liabilities | |||||
Deferred Income | 382,872,318.90 | 382,872,318.90 | |||
Deferred Income Tax Liabilities | 10,771,548.18 | 10,771,548.18 | |||
Other Non-current Liabilities | |||||
Subtotal of Non-current Liabilities | 393,643,867.08 | 393,643,867.08 | |||
Total Liabilities | 1,158,685,611.07 | 1,158,685,611.07 |
Shareholders' Equity: | |||||
Share Capital | 1,452,607,800.00 | 1,452,607,800.00 | |||
Other Equity Instruments |
Item | Balance at the end of the previous year | Balance at the beginning of the year | Adjusted amount | ||
Re-classification | Re-measurement | Total |
Including: Preferred Stocks | |||||
Perpetual Bonds | |||||
Capital Reserves | 2,476,312,069.09 | 2,476,312,069.09 | |||
Less: Treasury Share | |||||
Other Comprehensive Incomes | -8,681,151.59 | -8,681,151.59 | |||
Special Reserves | |||||
Surplus Reserves | 517,673,268.35 | 517,673,268.35 | |||
General Risk Reserves | |||||
Undistributed Profits | 5,176,157,180.79 | 5,176,157,180.79 | |||
Total Shareholders' Equity Attributable to the Parent Company | 9,614,069,166.64 | 9,614,069,166.64 |
Minority Shareholders' Equity | 268,322,155.87 | 268,322,155.87 | |||
Total Shareholders' Equity | 9,882,391,322.51 | 9,882,391,322.51 | |||
Total Liabilities and Shareholders' Equity | 11,041,076,933.58 | 11,041,076,933.58 |
Balance Sheet of the Parent Company
Item | Balance at the end of the previous year | Balance at the beginning of the year | Adjusted amount | ||
Re-classification | Re-measurement | Total | |||
Current Assets: |
Cash and Bank Balances | 645,534,966.84 | 645,534,966.84 | |||
Trading Financial Assets | 351,492,520.54 | 351,492,520.54 | |||
Derivative Financial Assets | |||||
Note’s receivable | |||||
Accounts receivable | 1,269,835.09 | 1,269,835.09 | |||
Receivables Financing |
Prepayments | 2,458,855.65 | 2,458,855.65 | |||
Other Receivables | 1,100,294,815.74 | 1,100,294,815.74 |
Inventory | 2,465,844.42 | 2,465,844.42 | |||
Contract Assets | Not applicable | ||||
Holding for-sale assets | |||||
Non-current Assets Due within 1 Year |
Other Current Assets | 1,671,867.65 | 1,671,867.65 | |||
Subtotal of Current Assets | 2,105,188,705.93 | 2,105,188,705.93 | |||
Non-current Assets: | |||||
Investment in Creditor's |
Item | Balance at the end of the previous year | Balance at the beginning of the year | Adjusted amount | ||
Re-classification | Re-measurement | Total |
Rights | |||||
Investment in Other Creditor's Rights |
Long-term Receivables | |||||
Long-term Equity Investment | 6,941,849,814.49 | 6,941,849,814.49 | |||
Investment in Other Equity Instruments | 294,665,442.88 | 294,665,442.88 | |||
Other Non-current Financial Assets |
Investment Property | |||||
Fixed Assets | 503,463,063.75 | 503,463,063.75 | |||
Projects under Construction | 59,331,122.60 | 59,331,122.60 | |||
Productive Biological Assets | |||||
Oil and gas assets | |||||
Intangible Assets | 145,128,033.35 | 145,128,033.35 | |||
Development Expenditure | |||||
Goodwill | |||||
Long-term unamortized expenses | 10,183,821.75 | 10,183,821.75 | |||
Deferred Income Tax Assets | 7,476,137.89 | 7,476,137.89 | |||
Other Non-current Assets | 9,838,928.50 | 9,838,928.50 | |||
Subtotal of Non-current Assets | 7,971,936,365.21 | 7,971,936,365.21 | |||
Total Assets | 10,077,125,071.14 | 10,077,125,071.14 | |||
Current Liabilities: | |||||
Short-term loan | |||||
Transactional financial liabilities | |||||
Derivative Financial Liabilities | |||||
Notes Payable | |||||
Accounts Payable | 44,171,004.81 | 44,171,004.81 | |||
Received Prepayments | 22,214,761.65 | 21,483,132.76 | -731,628.89 | -731,628.89 | |
Contract liabilities | Not applicable | 710,319.31 | 710,319.31 | 710,319.31 | |
Payroll payable | 12,673,534.31 | 12,673,534.31 | |||
Tax Payable | 4,818,330.21 | 4,818,330.21 | |||
Other Payables | 1,953,433,149.11 | 1,953,433,149.11 |
Item | Balance at the end of the previous year | Balance at the beginning of the year | Adjusted amount | ||
Re-classification | Re-measurement | Total |
Holding for-sale liabilities | |||||
Non-current Liabilities Due within 1 Year |
Other Current Liabilities | 21,309.58 | 21,309.58 | 21,309.58 | ||
Subtotal of Current Liabilities | 2,037,310,780.09 | 2,037,310,780.09 | |||
Non-current Liabilities: | |||||
Long-term loan |
Bonds Payable | |||||
Including: Preferred Stocks |
Perpetual Bonds | |||||
Long-term Payables | |||||
Long-term payroll payable | |||||
Expected Liabilities | |||||
Deferred Income | 5,620,598.89 | 5,620,598.89 | |||
Deferred Income Tax Liabilities | 9,983,693.86 | 9,983,693.86 | |||
Other Non-current Liabilities | |||||
Subtotal of Non-current Liabilities | 15,604,292.75 | 15,604,292.75 |
Total Liabilities | 2,052,915,072.84 | 2,052,915,072.84 | |||
Shareholders' Equity: |
Share Capital | 1,452,607,800.00 | 1,452,607,800.00 | |||
Other Equity Instruments | |||||
Including: Preferred Stocks | |||||
Perpetual Bonds | |||||
Capital Reserves | 2,478,350,525.70 | 2,478,350,525.70 | |||
Less: Treasury Share | |||||
Other Comprehensive Incomes | 31,870,051.79 | 31,870,051.79 | |||
Special Reserves | |||||
Surplus Reserves | 517,673,268.35 | 517,673,268.35 | |||
Undistributed Profits | 3,543,708,352.46 | 3,543,708,352.46 |
Total Shareholders' Equity | 8,024,209,998.30 | 8,024,209,998.30 | |||
Total Liabilities and Shareholders' Equity | 10,077,125,071.14 | 10,077,125,071.14 |
VII. Changes in the Scope of Consolidated Financial Statements Compared with the FinancialReport of Previous Year
√ Applicable □ Not applicable
There are 5 newly merged units in this period, the reasons are:
New Merged Units This Year | Investment Ratio | Notes |
Zhuhai Songcheng Performance Kingdom Co., Ltd | 100% | New in 2020 |
Zhuhai Southern Film and Television Cultural Industry Co., Ltd. | 100% | Acquire 100% equity in 2020 |
Zhuhai Huayin Landscaping Co., Ltd. | 55% | 55% holding subsidiary affiliated Zhuhai Southern Film and Television Cultural Industry Co., Ltd. acquired in 2020 |
Songcheng Brand Management Co., Ltd. | 100% | New in 2020 |
Romance Show Management Co., Ltd. | 100% | New in 2020 |
In the current period, the number of merged units was reduced by 2 due to:
Reduced Merged Units This Year | Investment Ratio | Notes |
Hangzhou Songcheng Art Troupe Co., Ltd. | 100% | Canceled in 2020 |
Zhejiang Songcheng Entertainment Culture Co., Ltd. | 100% | Canceled in 2020 |
VIII. Appointment and Dismissal of Accounting FirmsCurrently appointed accounting firms
Names of domestic accounting firms | BDO China Shu Lun Pan CPAs (special general partnership) |
Remuneration to domestic accounting firms (Unit: ten thousand yuan) | 130 |
Years of continuous audit service of domestic accounting firms | 20 years |
Names of Certified Public Accountants from domestic accounting firms | Ni Yilin, Jiang Xuelian |
The continuous period of audit service for certified public accountants in domestic accounting firms | 2 years, 2 years |
Whether to employ another accounting firm
□ Yes √ No
Appointment of accounting firms, financial advisers or sponsors for internal control auditing
□ Applicable √ Not applicable
IX. Delisting after Disclosure of Annual Report
□ Applicable √ Not applicable
X. Bankruptcy and Restructuring
□ Applicable √ Not applicable
No such case as bankruptcy and reorganization related event during the reporting period.
XI. Major Lawsuits and Arbitrations
□ Applicable √ Not applicable
There is no major lawsuit or arbitration in this year.XII. Penalties and Rectification
□ Applicable √ Not applicable
No such case as penalty and rectification during the reporting period.XIII. Integrity of the Company, Its Controlling Shareholder and Actual Controller
√ Applicable □ Not applicable
The Company, its controlling shareholder and actual controller are in good standing during the reporting period.XIV. Implementation of the Company's Equity Incentive Plan, Employee Stock Ownership Plan orOther Employee Incentive Measures
□ Applicable √ Not applicable
During the reporting period, the Company has no equity incentive plan, employee stock ownership plan or other employeeincentive measures and their implementation.
XV. Significant Related-party Transactions
1. Related transactions relevant to daily operations
√ Applicable □ Not applicable
Related transaction | Relation with related party | Type of related transaction | Content of the related - party transaction | Principle for pricing of related transaction | Price of related transaction | Amount of related transaction (RMB Ten Thousand) | Proportion in the number of similar transactions | Approved transaction limit (RMB Ten Thousand) | Whether the approved limit is exceeded | Settlement of related transaction | Available market price for similar transactions | Date of Disclosure | Disclosure Index |
Hangzhou First World Hotel Co., Ltd. | Affiliated legal person | Recurring related transactions | On-line procurement of hotel products | Refer to the market price | 282.04 | 282.04 | 1.32% | 37,062.23 | No | Cash and Bank Balances | 282.04 | Thursday, March 28, 2019 | http://www.cninfo.com.cn |
Hangzhou Songcheng Industry Co., Ltd | Affiliated legal person | Recurring related transactions | On-line procurement of hotel products | Refer to the market price | 634.3 | 634.3 | 2.96% | 37,062.23 | No | Cash and Bank Balances | 634.3 | Thursday, March 28, 2019 | http://www.cninfo.com.cn |
Beijing Beite Shengdi Technology Development Co., Ltd. | Affiliate | Contingent related transactions | Delegation of the scenic spot-related projects | Refer to the market price | 2915.6 | 2,915.60 | 3.02% | 2,915.60 | No | Cash and Bank Balances | 2915.6 | ||
Hangzhou First World Hotel Co., Ltd. | Affiliated legal person | Recurring related transactions | Ticket sales | Refer to the market price | 143.58 | 143.58 | 0.67% | 37,062.23 | No | Cash and Bank Balances | 143.58 | Thursday, March 28, 2019 | http://www.cninfo.com.cn |
Related transaction | Relation with related party | Type of related transaction | Content of the related - party transaction | Principle for pricing of related transaction | Price of related transaction | Amount of related transaction (RMB Ten Thousand) | Proportion in the number of similar transactions | Approved transaction limit (RMB Ten Thousand) | Whether the approved limit is exceeded | Settlement of related transaction | Available market price for similar transactions | Date of Disclosure | Disclosure Index |
Hangzhou Songcheng Industry Co., Ltd | Affiliated legal person | Recurring related transactions | Ticket sales | Refer to the market price | 242.57 | 242.57 | 1.13% | 37,062.23 | No | Cash and Bank Balances | 242.57 | Thursday, March 28, 2019 | http://www.cninfo.com.cn |
Hangzhou Songcheng Industry Co., Ltd | Affiliated legal person | Recurring related transactions | Leasing of the office space | Refer to the market price | 251.62 | 251.62 | 9.75% | 402.59 | No (The rent of 4.5 months is reduced for related parties due to the epidemic) | Cash and Bank Balances | 251.62 | Thursday, March 28, 2019 | http://www.cninfo.com.cn |
Hangzhou Songcheng Industry Co., Ltd | Affiliated legal person | Recurring related transactions | Leasing of the parking lot | Refer to the market price | 622.51 | 622.51 | 24.11% | 996.01 | No (The rent of 4.5 months is reduced for related parties due to the epidemic) | Cash and Bank Balances | 622.51 | Saturday, December 17, 2016 | http://www.cninfo.com.cn |
Hangzhou Songcheng Industry Co., Ltd | Affiliated legal person | Recurring related transactions | Leasing of the operating room in the | Refer to the market price | 149.49 | 149.49 | 5.79% | 239.18 | No (The rent of 4.5 months is reduced | Cash and Bank Balances | 149.49 | Thursday, March 28, 2019 | http://www.cninfo.com.cn |
Related transaction | Relation with related party | Type of related transaction | Content of the related - party transaction | Principle for pricing of related transaction | Price of related transaction | Amount of related transaction (RMB Ten Thousand) | Proportion in the number of similar transactions | Approved transaction limit (RMB Ten Thousand) | Whether the approved limit is exceeded | Settlement of related transaction | Available market price for similar transactions | Date of Disclosure | Disclosure Index |
scenic spot | for related parties due to the epidemic) | ||||||||||||
Hangzhou Songcheng Industry Co., Ltd | Affiliated legal person | Recurring related transactions | Leasing of the dormitory | Refer to the market price | 160.06 | 160.06 | 6.20% | 256.1 | No (The rent of 4.5 months is reduced for related parties due to the epidemic) | Cash and Bank Balances | 160.06 | Thursday, March 28, 2019 | http://www.cninfo.com.cn |
Hangzhou Songcheng Industry Co., Ltd | Affiliated legal person | Recurring related transactions | Leasing of the parking lot | Refer to the market price | 296.66 | 296.66 | 11.49% | 474.66 | No (The rent of 4.5 months is reduced for related parties due to the epidemic) | Cash and Bank Balances | 296.66 | Thursday, March 28, 2019 | http://www.cninfo.com.cn |
Hangzhou Songcheng Industry Co., Ltd | Affiliated legal person | Recurring related transactions | Leasing of the operating room in the | Refer to the market price | 173.93 | 173.93 | 6.74% | 278.28 | No (The rent of 4.5 months is reduced | Cash and Bank Balances | 173.93 | Thursday, March 28, 2019 | http://www.cninfo.com.cn |
Related transaction | Relation with related party | Type of related transaction | Content of the related - party transaction | Principle for pricing of related transaction | Price of related transaction | Amount of related transaction (RMB Ten Thousand) | Proportion in the number of similar transactions | Approved transaction limit (RMB Ten Thousand) | Whether the approved limit is exceeded | Settlement of related transaction | Available market price for similar transactions | Date of Disclosure | Disclosure Index |
scenic spot | for related parties due to the epidemic) | ||||||||||||
Hangzhou First World Hotel Co., Ltd. | Affiliated legal person | Recurring related transactions | Leasing of the operating room in the scenic spot | Refer to the market price | 47.25 | 47.25 | 1.83% | 75.6 | No (The rent of 4.5 months is reduced for related parties due to the epidemic) | Cash and Bank Balances | 47.25 | Monday, February 29, 2016 | http://www.cninfo.com.cn |
Hangzhou World Leisure Expo Park Co., Ltd | Affiliated legal person | Recurring related transactions | Leasing of the parking lot | Refer to the market price | 431.82 | 431.82 | 16.73% | 690.91 | No (The rent of 4.5 months is reduced for related parties due to the epidemic) | Cash and Bank Balances | 431.82 | Thursday, March 28, 2019 | http://www.cninfo.com.cn |
Hangzhou World Leisure Expo Park Co., Ltd | Affiliated legal person | Recurring related transactions | Leasing of the dormitory | Refer to the market price | 67.73 | 67.73 | 2.62% | 108.36 | No (The rent of 4.5 months is reduced | Cash and Bank Balances | 67.73 | Thursday, March 28, 2019 | http://www.cninfo.com.cn |
Related transaction | Relation with related party | Type of related transaction | Content of the related - party transaction | Principle for pricing of related transaction | Price of related transaction | Amount of related transaction (RMB Ten Thousand) | Proportion in the number of similar transactions | Approved transaction limit (RMB Ten Thousand) | Whether the approved limit is exceeded | Settlement of related transaction | Available market price for similar transactions | Date of Disclosure | Disclosure Index |
for related parties due to the epidemic) | |||||||||||||
Total | -- | -- | 6,419.16 | -- | 154,686.21 | -- | -- | -- | -- | -- | |||
Details of major sales returned | N/A | ||||||||||||
Actual performance during the reporting period where the total amount of daily related party transactions in the current period is estimated by category (if any) | N/A | ||||||||||||
Reasons for the big difference between the transaction price and the reference market price, if applicable | Not applicable. |
2. Related transactions in acquisition or sale of assets or equities
□ Applicable √ Not applicable
No such case as related-party transactions arising from the acquisition or sale of assets or equity.
3. Significant related-party transactions arising from joint investments on external parties
√ Applicable □ Not applicable
Co-investor | Relation with related party | Name of the invested enterprise | Main business of the invested enterprise | Registered capital of the invested enterprise | Total assets of the invested enterprise (RMB Ten Thousand) | Net asset of the invested enterprise (RMB Ten Thousand) | Net profit of the invested enterprise (RMB Ten Thousand) |
Ningbo Songcheng Qixian Investment Management Co., Ltd. | Affiliate | Ningno Songcheng Performance Live Entertainment Investment Partnership (limited partnership) | Equity investment, project investment, investment management, enterprise management and investment consultation | RMB 300 million | 17,550.96 | 17,550.96 | -102.44 |
Hangzhou Songcheng Group Holdings Co., Ltd, Ningbo Qixian Internet Investment Management Co., Ltd. | Controlling shareholder, affiliate | Ningno Songcheng Internet Entertainment Investment Partnership (limited partnership) | Project investment, investment management, enterprise management consultation, investment consultation and equity investment | RMB 125 million | 7,180.58 | 7,100.58 | -1,914.45 |
Shenzhen CGS Fund Management Co., Ltd., Qixian Equity Investment Management Co., Ltd. | Affiliated legal person, affiliate | Ningno Meishan Bonded Port Area Qixian Innovation Entertainment Investment Partnership (limited partnership) | Entertainment project investment, industrial investment, project investment, investment management, enterprise management consultation and investment management | RMB 155 million | 7,334.14 | 7,331.64 | -212.43 |
Progress of major projects under construction of the invested enterprise, if any | N/A |
Other notes: in September 2019, Songcheng Holdings (Thailand) Co., Ltd., a wholly-owned subsidiary of the Company, andQiyun Holdings (Thailand) Co., Ltd., a related person, jointly established Songcheng (Pattaya) International Culture Co., Ltd. with theregistered capital of THB 5 million, for which the parties paid THB 3.25 million and THB 750 thousand respectively, accounting for
65.00% and 15.00%. As at December 31, 2020, neither the Company nor the related persons have completed the contribution.
4. Related-party creditor's rights and debts
□ Applicable √ Not applicable
No such case as related credits and debts during the reporting period.
5. Other major related transactions
□ Applicable √ Not applicable
XVI. Major Contracts and Their Performance
1. Matters on trusteeship, contracting, and leasehold
(1) Matters on trusteeship
□ Applicable √ Not applicable
No such case as custody during the reporting period.
(2) Contracting
□ Applicable √ Not applicable
No such case as contracting during the reporting period.
(3) Leasing
□ Applicable √ Not applicable
2. Significant guarantees
□ Applicable √ Not applicable
There is no guarantee during the reporting period.
3. Entrusting Others to Manage Cash Assets
(1) Entrusted Financing
□ Applicable √ Not applicable
No such case as entrusted financing during the reporting period.
(2) Entrusted Loans
□ Applicable √ Not applicable
No such case as entrusted loan during the reporting period.
4. Other Significant Contracts
□ Applicable √ Not applicable
No such case as other significant contract during the reporting period.XVII. Social Responsibilities
1. Fulfillment of Social Responsibilities
Since establishment, he Company, has been exploring in the cultural and tourist industry with the spirit of craftsmanship, andbeen devoted to cultivating the traditional culture and art of China with the idea of industry innovation, which formed a uniquebusiness model and made contributions to the dissemination of Chinese culture. In the past years, the Company stayed true to itsmission, and insisted on fulfilling its corporate social responsibilities with the support from its operating performances such ascontinued expansion of businesses, year-on-year increase of visitors and stable profit growth. The company always adheres to thepractice of corporate social responsibility, and promotes the prosperity and development of the Chinese culture and art in anall-round, three-dimensional and multi-angle manner through featured theme activities, public charity and other methods, so as tomake its contribution to promotion of the Chinese traditional culture.The Company brought magnificent art feasts for thousands of masses in the mountainous areas through "Songcheng Travel ofPoverty Alleviation in Cultural Caravans", donated RMB 10 million to the areas ravaged by catastrophic floods in Ningxiang City,Hunan Province, helped Guilin, Zhangjiajie and Xi'an in poverty alleviation in the field of culture and art through its local projects,established "Culture and Art Poverty Alleviation Fund" by donation, and supported the development of the local culture. Whattraditional culture gives Songcheng is not only the inexhaustible source of creation, but also the special cultural feeling.In September 2018, the Company initiated and established Zhejiang Songcheng Performance Art Development Foundation to"support the development of the national art and performance and the poverty alleviation in art". It was a new attempt of theCompany in the field of public charity to better achieve the goal of "contributing to the society". The Foundation will promote theprosperous development of the Chinese culture and art in an all-round, three-dimensional and multi-angle manner through povertyalleviation in art, industry-university-research cooperation, funding of excellent projects and talents, driving of public cultureactivities and external exchange in art, making new efforts to carry forward the traditional culture of China.
2. Social responsibility fulfillment regarding targeted poverty alleviation
(1) Plan for Targeted Poverty Alleviation
The Company earnestly responds to the call of the national, provincial and municipal authorities for poverty alleviation byfully displaying its own advantages and the advantages in industry, and by actively carrying out targeted poverty alleviation work.
(2) Overview of Annual Targeted Poverty Alleviation
During the reporting period, the Company actively responded to the call of the Central Government “to win the battle againstpoverty” by carrying out the poverty alleviation work in the field of culture and art. During the reporting period, the Company andits subsidiaries also participated in public welfare activities such as donation to schools and donation for poverty alleviation.
(3) Result of Targeted Poverty Alleviation
Indicator | Measurement Unit | Quantity/Implementation |
I. Overview | —— | —— |
II. Itemized investment | —— | —— |
1. Poverty alleviation by industry development | —— | —— |
2. Poverty alleviation by transfer and employment | —— | —— |
3. Poverty alleviation by relocation | —— | —— |
4. Educational poverty alleviation | —— | —— |
5. Health poverty alleviation | —— | —— |
6. Ecological poverty alleviation | —— | —— |
7. Minimum guarantee | —— | —— |
8. Social poverty alleviation | —— | —— |
9. Others | —— | —— |
III. Awards (content and level) | —— | —— |
(4) Plan for Subsequent Targeted Poverty Alleviation
In 2021, the Company will actively respond to the call of the national, provincial and municipal authorities about povertyalleviation by cooperating with the government departments at all levels to win the battle against poverty alleviation and fulfillingthe social responsibilities and obligations.
3.Environmental Protection-related Matters
Whether the listed company and its subsidiaries belong to the key pollutant discharging units announced by the environmental
protection department
□ Yes √ No
The listed company and its subsidiaries are not the key pollutant discharging units announced by the environmental protectiondepartment.XVIII. Explanations to Other Significant Matters
□ Applicable √ Not applicable
There were no other significant matters for explanation during the reporting period.XIX. Major Events of the Company's Subsidiaries
□ Applicable √ Not applicable
Section VI Changes in Shares and Information about Shareholders
I. Changes in Shares
1. Changes in shares
Unit: share
Before the change | Increase or decrease in the change (+, -) | After the change | |||||||
Number | Percentage | Shares newly issued | Bonus shares | Shares converted from capital reserves | Others | Subtotal | Number | Percentage | |
I. Shares with limited sales condition | 263,918,107 | 18.17% | 0 | 0 | 180,437,715 | -38,370,962 | 142,066,753 | 405,984,860 | 15.53% |
1. State-owned shares | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% |
2. Shares held by state-owned legal persons | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% |
3. Other domestic shares | 263,918,107 | 18.17% | 0 | 0 | 180,437,715 | -38,370,962 | 142,066,753 | 405,984,860 | 15.53% |
Including: Shares held by domestic legal persons | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% |
Shares held by domestic natural persons | 263,918,107 | 18.17% | 0 | 0 | 180,437,715 | -38,370,962 | 142,066,753 | 405,984,860 | 15.53% |
4. Foreign shares | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% |
Including: Shares held by overseas legal persons | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% |
0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% |
Shares held by foreign natural persons | |||||||||
II. Shares without restrictions | 1,188,689,693 | 81.83% | 0 | 0 | 981,648,525 | 38,370,962 | 1,020,019,487 | 2,208,709,180 | 84.47% |
1. RMB ordinary shares | 1,188,689,693 | 81.83% | 0 | 0 | 981,648,525 | 38,370,962 | 1,020,019,487 | 2,208,709,180 | 84.47% |
2. Foreign shares list in China | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% |
3. Foreign shares listed in overseas | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% |
4. Other | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% |
III. Total | 1,452,607,800 | 100.00% | 0 | 0 | 1,162,086,240 | 0 | 1,162,086,240 | 2,614,694,040 | 100.00% |
Reasons for changes in shares
√ Applicable □ Not applicable
(1) During the reporting period, 38,830,789 shares locked by executives were unlocked, and 459,827 shares locked byexecutives were added.
(2) During the reporting period, the Company implemented 2019 equity distribution plan: Taking the total share capital of1,452,607,800 shares of 2019 as the basis, RMB 2.00 (tax included) of dividend for every 10 shares was distributed to all theshareholders, with a total cash dividend of RMB 290,521,560 and 8 shares capitalized from the capital reserves were distributed toall the shareholders for every 10 shares, with a total number of 1,162,086,240 shares. Upon such capitalization, the total sharecapital after conversion amounted to 2,614,694,040 shares.Approval for changes in shares
√ Applicable □ Not applicable
(1) On April 27, 2020, the 6th meeting of the 7th Board of Directors and the 5th meeting of the 7th Board of Supervisors wereheld by the Company, which reviewed and approved the 2019 Proposal on Profit Distribution and Capital Reserve Capitalization. Theproposal on profit distribution and capital reserve capitalization of the Company in 2019 was: Taking the total share capital of1,452,607,800 shares of 2019 as the basis, RMB 2.00 (tax included) of dividend for every 10 shares was distributed to all theshareholders, with a total cash dividend of RMB 290,521,560 and 8 shares capitalized from the capital reserves were distributed toall the shareholders for every 10 shares, with a total number of 1,162,086,240 shares. Upon such capitalization, the total sharecapital amounted to 2,614,694,040 shares.
(2) On May 18, 2020, the annual shareholders' meeting was held by the Company in 2019, which reviewed and approved the2019 Proposal on Profit Distribution and Capital Reserve Capitalization.Transfer for changes in shares
√ Applicable □ Not applicable
During the reporting period, the appropriate procedures for the capitalized share capital have been completed at ShenzhenBranch, China Securities Depository and Clearing Corporation Limited.The progress on share repurchases
□ Applicable √ Not applicable
The progress on reduction of re-purchase shares by means of centralized competitive bidding
□ Applicable √ Not applicable
Effects of changes in shares on the basic earnings per share ("EPS"), diluted EPS, net assets per share, attributable to commonshareholders of the Company, and other financial indexes over the last year and last period
□ Applicable √ Not applicable
Other contents that the Company considers necessary or are required by the securities regulatory authorities to disclose
□ Applicable √ Not applicable
2. Changes in restricted stocks
√ Applicable □ Not applicable
Unit: share
Name of Shareholder | Number Of Shares With Limited Sales Condition At The Beginning Of The Period | Number of increased shares with limited sales condition in current period | Number of unlocked shares with limited sales condition in current period | Number of shares with limited sales condition at the end of the period | Reasons for limited sales | Proposed date of lifting sales restriction |
Huang Qiaoling | 163,913,427 | 131,130,742 | 295,044,169 | Shares locked by executives | In respect of the shares locked by executives, 75% of the total shares will be locked at the beginning of each year | |
Huang Qiaolong | 41,181,934 | 32,945,547 | 74,127,481 | Shares locked by executives | Ibid | |
Liu Ping | 17,879,482 | 15,131,274 | 33,010,756 | Shares locked by executives | Ibid | |
Liu Yan | 38,741,884 | 38,741,884 | 0 | Resignation of the director | It shall be executed as per the regulations on management of executive shares | |
Zhang Xian | 902,767 | 722,214 | 1,624,981 | Shares locked by executives | Ibid | |
Zhang Jiankun | 686,103 | 548,882 | 1,234,985 | Shares locked by executives | Ibid | |
Shang Lingxia | 343,051 | 274,440 | 617,491 | Shares locked by executives | Ibid | |
Chen Shengmin | 180,554 | 144,443 | 324,997 | Shares locked by executives | Ibid | |
Dong Xin | 88,905 | 88,905 | Resignation of the secretary | It shall be executed as per the regulations on management of |
to the Board of Directors | executive shares | |||||
Total | 263,918,107 | 180,897,542 | 38,830,789 | 405,984,860 | -- | -- |
II. Issuance and listing of securities
1. Securities (excluding preferred share) issued in reporting period
□ Applicable √ Not applicable
2. Explanation on changes in total number of the Company's shares & the structure of shareholders and thestructure of assets and liabilities
□ Applicable √ Not applicable
3. Existing shares held by internal staff of the Company
□ Applicable √ Not applicable
III. Particulars about the shareholders and actual controller
1. Total number of shareholders and their shareholdings
Unit: share
Total Number Of Common Shareholders At The End Of The Reporting Period | 39,572 | Total number of common shareholders at the end of previous month before the disclosure date of the annual report | 53,817 | Total number of preferred shareholders (if any) (refer to Note 9) whose voting rights have been recovered at the end of the reporting period | 0 | Total number of preferred shareholders (if any) (refer to Note 9) with resumed voting rights at the end of previous month before the disclosure date of the annual report | 0 | |
Shareholding list of shareholders with over 5% shares or top ten shareholders | ||||||||
Name of Shareholder | Nature Of Shareholder | Shareholding Percentage | Number of shares held at the end of the reporting period | Changes in the reporting period | Number of shares held with limited sales conditions | Number of shares held without limited sales condition | Pledges or freezings | |
State Of Shares | Number |
Hangzhou Songcheng Group Holdings Co., Ltd | Domestic Non-state-owned Legal Person | 29.48% | 770,835,254 | 342,593,446 | 0 | 770,835,254 | Pledge | 122,400,000 |
Huang Qiaoling | Domestic Natural Person | 11.83% | 309,192,225 | 90,640,989 | 295,044,169 | 14,148,056 | ||
Hong Kong Securities Clearing Company Ltd. | Overseas Legal Person | 3.74% | 97,849,470 | 66,514,862 | 0 | 97,849,470 | ||
Huang Qiaolong | Domestic Natural Person | 3.28% | 85,836,643 | 30,927,397 | 74,127,481 | 11,709,162 | ||
Industrial Bank Co., Ltd. - Xingquan Trend Investment Hybrid Type Securities Investment Fund | Others | 2.21% | 57,764,086 | 32,388,617 | 0 | 57,764,086 | ||
Liu Yan | Domestic Natural Person | 1.70% | 44,553,289 | 2,897,395 | 0 | 44,553,289 | ||
One One Two Combination of National Social Security Fund | Others | 1.53% | 39,889,483 | 39,889,483 | 0 | 39,889,483 | ||
Liu Ping | Domestic Natural Person | 1.37% | 35,910,758 | 12,071,448 | 33,010,756 | 2,900,002 | ||
One Zero Eight Combination of National Social Security Fund | Others | 1.22% | 32,000,000 | 32,000,000 | 0 | 32,000,000 | ||
Puxin Investment Company - Customer Fund | Overseas Legal Person | 1.16% | 30,416,249 | 30,416,249 | 0 | 30,416,249 |
Description of the association relationship or concerted action of above-mentioned shareholders | Hangzhou Songcheng Group Holdings Co., Ltd and Huang Qiaoling are the controlling shareholder and actual controller of the Company, respectively; Huang Qiaolong and Liu Ping are the related natural persons of the actual controller Mr. Huang Qiaoling. | ||
Shareholding list of top ten shareholders without limited sales condition | |||
Name of Shareholder | Number of shares held without limited sales condition at the end of the reporting period | Type of shares | |
Type of shares | Number | ||
Hangzhou Songcheng Group Holdings Co., Ltd | 770,835,254 | RMB common stock | 770,835,254 |
Hong Kong Securities Clearing Company Ltd. | 97,849,470 | RMB common stock | 97,849,470 |
Industrial Bank Co., Ltd. - Xingquan Trend Investment Hybrid Type Securities Investment Fund | 57,764,086 | RMB common stock | 57,764,086 |
Liu Yan | 44,553,289 | RMB common stock | 44,553,289 |
One One Two Combination of National Social Security Fund | 39,889,483 | RMB common stock | 39,889,483 |
One Zero Eight Combination of National Social Security Fund | 32,000,000 | RMB common stock | 32,000,000 |
Puxin Investment Company - Customer Fund | 30,416,249 | RMB common stock | 30,416,249 |
Industrial Bank Co., Ltd. - Xingquan New Vision Hybrid Type Initiated Securities Investment Fund with Flexible Setting and Regular Availability | 26,279,865 | RMB common stock | 26,279,865 |
Industrial and Commercial Bank of China - Huitianfu Growth Focus Hybrid Type Securities Investment Fund | 25,500,081 | RMB common stock | 25,500,081 |
Industrial and Commercial Bank of China Company Limited - | 23,500,000 | RMB common | 23,500,000 |
Huitianfu Blue-chip Hybrid Type Securities Investment Fund with Stable, Flexible Setting | stock | ||
Explanation on associated relationship or persons acting in concert among top ten shareholders without limited shares, and between top ten shareholders without limited shares and top ten shareholders | Hangzhou Songcheng Group Holdings Co., Ltd and Huang Qiaoling are the controlling shareholder and the actual controller of the Company, respectively; Huang Qiaolong and Liu Ping are the related natural persons of the actual controller Mr. Huang Qiaoling. |
Whether the Company's top ten common shareholders or top ten common shareholders without limited shares agree on anyrepurchase transaction in the reporting period
□ Yes √ No
None of the Company's top ten common shareholders or top ten common shareholders without limited shares agreed onrepurchase in the reporting period.
2. Particulars about the controlling shareholder
Nature of the controlling shareholder: Natural person-ownedType of the controlling shareholder: legal person
Name of the controlling shareholder | Legal representative/unit head | Date of establishment | Organization Code | Main businesses |
Hangzhou Songcheng Group Holdings Co., Ltd | Wang Pengyu | November 21, 1997 | 91330109255712632Y | Industrial investment |
Equity interest of other listed companies, at home and abroad, controlled and jointly controlled by controlling shareholders during the reporting period | N/A |
Change of the controlling shareholders in the reporting period
□ Applicable √ Not applicable
No change has happened to the controlling shareholder in the reporting period of the Company
3. The actual controller of the Company and persons acting in concert
Nature of the actual controller: Domestic natural personType of the actual controller: Natural person
Name of the actual controller | Relationship with the actual controller | Nationality | Whether he/she has obtained the right of residence in another country or |
region | |||
Huang Qiaoling | Himself | China | No |
Main occupation and title | Mr. Huang Qiaoling served as the chairman and president of Songcheng Tourism Development Co., Ltd from February 1999 to December 2000. He served as the chairman of Hangzhou Songcheng Group Holdings Co., Ltd from November 1997 to March 2013. He served as the chairman of Hangzhou World Leisure Expo Park Co., Ltd from August 2001 to March 2013. He has been serving as the chairman of this Company since December 2000. | ||
Information about other listed companies at home and abroad controlled in the last ten years | N/A |
Change of the actual controller in the reporting period
□ Applicable √ Not applicable
No change has happened to the actual controller in the reporting periodBlock Digram for Property Right and Control Relationship between the Company and Actual Controllers
The actual controller controls the Company via trust or other ways of asset management
□ Applicable √ Not applicable
4. Particulars about other corporate shareholders with shareholding proportion over 10%
□ Applicable √ Not applicable
5. Particulars on share reduction restricted for controlling shareholders, actual controller, restructuring partyor other commitment entities
□ Applicable √ Not applicable
Section VII Information of Preferred Shares
□ Applicable √ Not applicable
There are no preferred shares in the reporting period.
Section VIII Convertible Corporate Bonds
□ Applicable √ Not applicable
There are no convertible corporate bonds in the reporting period.
Section IX Directors, Supervisors, Senior Managers and Employees
I. Shareholding Changes of Directors, Supervisors and Senior Management
Name | Post | Position status | Gender | Age | Starting date of tenure | Termination Date of tenure | Number of shares held at the beginning of the period (share) | Number of shares increased in the period (share) | Number of shares decreased in the period (share) | Other changes (share) | Number of shares held at the end of the period |
Huang Qiaoling | Chairman | Incumbent | Male | 63 | June 6, 2010 | August 8, 2022 | 218,551,236 | 84,200,000 | 174,840,989 | 309,192,225 | |
Huang Qiaolong | Director | Incumbent | Male | 61 | June 6, 2010 | August 8, 2022 | 54,909,246 | 13,000,000 | 43,927,397 | 85,836,643 | |
Zhang Xian | Director, President | Incumbent | Female | 47 | June 6, 2010 | August 8, 2022 | 1,203,690 | 962,952 | 2,166,642 | ||
Zhang Jiankun | Director, Executive President | Incumbent | Male | 57 | March 20, 2013 | August 8, 2022 | 914,804 | 731,843 | 1,646,647 | ||
Huang Hongming | Director | Incumbent | Male | 49 | April 26, 2019 | August 8, 2022 | |||||
Shang Lingxia | Director, Executive Vice President | Incumbent | Female | 46 | August 12, 2013 | August 8, 2022 | 457,402 | 365,921 | 823,323 | ||
Lanke | Independent Director | Incumbent | Male | 71 | August 21, 2015 | August 8, 2022 | |||||
Liu Shuzhe | Independent Director | Incumbent | Male | 64 | August 8, 2019 | August 8, 2022 | |||||
Yu Qinyi | Independent Director | Incumbent | Female | 41 | March 24, 2017 | August 8, 2022 | |||||
Zhu Hualu | Supervisor | Incumbent | Female | 66 | June 6, 2010 | August 8, 2022 | |||||
Yu Feng | Staff Supervisor | Incumbent | Female | 45 | August 12, 2013 | August 8, 2022 | |||||
Xu Jie | Supervisor | Incumbent | Female | 53 | August 9, 2016 | August 8, 2022 | 200 | 160 | 360 | ||
Zheng Qi | Vice President | Incumbent | Male | 44 | October 26, 2018 | August 8, 2022 |
Chen Shengmin | Secretary to the Board of Directors and Chief Financial Officer | Incumbent | Male | 50 | May 21, 2010 | August 8, 2022 | 240,739 | 192,591 | 433,330 | ||
Total | -- | -- | -- | -- | -- | -- | 276,277,317 | 0 | 97,200,000 | 221,021,853 | 400,099,170 |
II. Changes of Directors, Supervisors and Senior Management
□ Applicable √ Not applicable
III. PositionsProfessional backgrounds, major work experiences and current main responsibilities in the Company for incumbent directors,supervisors and senior management of the Company
1. Mr. Huang Qiaoling: 63 years old, senior economist, Chinese nationality, without permanent residency abroad. Mr. HuangQiaoling served as Chairman and President of Songcheng Tourism Development Co., Ltd. from February 1999 to December 2000;From November 1997 to March 2013, he served as Chairman of Songcheng Holdings; From August 2001 to March 2013, he servedas Chairman of Hangzhou World Leisure Expo Park Co., Ltd. He has been serving as the chairman of this Company since December2000.
2. Mr. Huang Qiaolong: 61 years old, college degree, economist, Chinese nationality, without permanent residency abroad. Mr.Huang Qiaolong served as Vice President and Chairman of Songcheng Holdings from March 2003 to November 2009. He has servedas a director of the Company since December 2000.
3. Ms. Zhang Xian: 47 years old, master degree, a famous person in national publicity and cultural system, with the prestigioustitle of "Four Excellency" talent. Chinese nationality, without permanent residency abroad. Ms. Zhang Xian taught initially Englishand advanced to become Deputy Director of Nanhu Revolutionary Memorial Hall. In December 2000, she joined Songcheng Groupas Deputy General Manager of Songcheng Holdings; From February 2002 to July 2003, she served as the General Manager ofSongcheng Tourism Management Branch; From August 2003 to February 2007, she served as Vice President of Songcheng Holdings;From March 2007 to February 2009, she served as Vice President of the Company; From March 2009 to December 2010, she servedas Executive President of the Company; She has served as a director of the Company since June 2010 and as President of theCompany since December 2010.
4. Mr. Zhang Jiankun: 57 years old, college degree, Chinese nationality, without permanent residency abroad. From October1994 to April 1999, Mr. Zhang Jiankun served as the director of Songcheng Real Estate Engineering Department; From May 1999 toFebruary 2002, he served as the Engineering Department Manager of Hangzhou Huamei Science and Technology EducationInvestment Co., Ltd.; From March 2002 to February 2004, he served as Deputy General Manager of Songcheng Holding EngineeringConstruction Department; From March 2004 to February 2005, he served as Deputy General Manager of Landscape Real Estate;From March 2005 to February 2006, he served as General Manager of Songcheng Holdings Engineering Department; From March2006 to February 2009, he served as Vice President of Landscape Real Estate; From March 2009 to February 2012, he served as VicePresident of the Company; From March 2012 to December 2013, he served as Executive Vice President of the Company; He hasbeen the Executive President of the Company since January 2013 and the director of the Company since February 2013.
5. Mr. Huang Hongming: 49 years old, bachelor degree, senior economist, Chinese nationality, without permanent residencyabroad. Mr. Huang Hongming has been the Deputy General Manager of Songcheng Real Estate Company; Vice Chairman andPresident of Hong Kong Jinhui International Investment Group; Since September 2013, he has served as Executive President ofSongcheng Holdings Company, and has served as a director of the Company since April 2019.
6. Ms. Shang Lingxia: 46 years old, bachelor degree, Chinese nationality, without permanent residency abroad. Ms. ShangLingxia served as the secretary of Chairman of Songcheng Holdings from March 2001 to July 2003; From August 2003 to September2005, she served as General Manager of Songcheng Tourism Management Subsidiary; From October 2005 to April 2008, she servedas General Manager of Hangzhou World Leisure Expo Park Co., Ltd.; From May 2008 to November 2010, she served as GeneralManager of First World Hotel; From December 2010 to December 2017, she served as Vice President of the Company; She hasserved as a director of the Company since August 2013 and as Executive Vice President of the Company since January 2018.
7. Mr. Lanke: 71 years old, bachelor degree, professor, Chinese nationality, without permanent residency abroad. Mr. Lanke hasbeen engaged in the research and teaching of Chinese folk culture for fourteen years. In 1989, he went to Shenzhen OverseasChinese Town to participate in the planning and construction management of the Splendid China Folk Culture Village, and served asGeneral Manager of Happy Valley and the Group's Tourism Development Department; from 2000 to 2003, he was President ofSongcheng Group; later, he was Vice Chairman and senior advisor of Haichang Group, and has been an independent director of theCompany since August 2015.
8. Mr. Liu Shuzhe: 64 years old, master degree, senior economist, Chinese nationality, without permanent residency abroad. Mr.Liu Shuzhe has served as loan officer of Jiande Sub-branch of People's Bank of China, Deputy Head of Xiaoshan Sub-branch ofIndustrial and Commercial Bank of China, Chief, Deputy Director and Vice President of Hangzhou Branch of Industrial andCommercial Bank of China, and has been an independent director of the Company since August 2019.
9. Ms. Yu Qinyi: 41 years old, master degree, Chinese nationality, without permanent residency abroad. From July 2005 toDecember 2009, she served as strategic investment consultant of Zhongxin Zhongliang Lianxing Co.,Ltd.; Since January 2010, shehas been a certified public accountant of Zhejiang Herui Certified Public Accountants Co., Ltd., and has been an independentdirector of the Company since March 2017.
10. Ms. Zhu Hualu: 66 years old, college degree, Chinese nationality, without permanent residency abroad. From January 1995to January 2005, Ms. Zhu Hualu served as Art Department Manager, General Manager Assistant and Executive Deputy GeneralManager of Hangzhou World City Songcheng Real Estate Co., Ltd., and Vice President of Hangzhou Songcheng Group Holdings Co.,Ltd.; She has served as Chairman of the Board of Supervisors of the Company since December 2000.
11. Ms. Yu Feng: 45 years old, bachelor degree, Chinese nationality, without permanent residency abroad. Ms. Yu Feng servedas Deputy Manager of Xiaoshan International Hotel from October 1995 to June 2003; From August 2003 to July 2004, she served asDeputy Manager of Human Resources Department of Hangzhou Paradise; From August 2004 to November 2006, she served as HRManager of Hangzhou Landscape Real Estate Co., Ltd. and HR Manager of Hangzhou World Leisure Expo Park Co., Ltd.; FromDecember 2006 to April 2011, she served as Director of Human Resources Department and Deputy General Manager of generalmanager office of Hangzhou First World Hotel Co., Ltd.; From April 2011 to December 2012, she served as Deputy Director ofHuman Resources Department of Hangzhou Songcheng Group Holdings Co., Ltd.; From January 2013 to December 2015, she servedas Director of Hangzhou First World Hotel Co., Ltd. and Deputy General Manager of the administrative office; From January 2016 toDecember 2017, she served as General Manager of Hangzhou Songcheng Tourism Development Co., Ltd.; She has served asPresident Assistant of the Company since January 2018, and has served as supervisor of the Company since August 2013.
12. Ms. Xu Jie, 53 years old, assistant ideological and political worker, Chinese nationality, without permanent residency abroad.From June 1999 to February 2002, Ms. Xu Jie served as Deputy Manager of Real Estate Marketing Department of Hangzhou XianghuGreen Valley Tourism Development Co., Ltd. From March 2002 to June 2002, she served as Deputy Manager of Early StageDepartment of Hangzhou Nandu Songcheng Real Estate Co., Ltd.; From July 2002 to May 2006, she served as Property Manager ofHangzhou World Leisure Expo Park Co., Ltd.; From June 2006 to December 2008, she served as Property Manager of HangzhouSongcheng Landscape Real Estate Co., Ltd.; From February 2009 to December 2010, she served as General Manager Assistant ofHangzhou Songcheng Group Property Services Co., Ltd.; Since January 2010, she has served as Deputy General Manager ofHangzhou World Leisure Expo Park Co., Ltd., and since August 2016, she has served as supervisor of the Company.
13. Mr. Zheng Qi: 44 years old, college degree, Chinese nationality, has served as Sales Manager of the mobile phone businessunit of the Market Development Department of China Putian Hangzhou Subsidiary; Manager of Jiangsu and Hubei Regions of
Mobile Communications Division of East China Representative Office of Ericsson China Investment Co., Ltd.; General Manager ofEnergy Division of Aerospace Communications Holding Group Co., Ltd.; Deputy general manager of Zhejiang Aerospace ElectronicInformation Industry Co., Ltd. Since December 2013, he has served as Executive Director and General Manager of Lijiang ChamaAncient City Tourism Development Co., Ltd, Chairman and General Manager of Aba Zhou Jiuzhai Romance Tourism Development Co.,Ltd, Director and General Manager of Guilin Lijiang Romance Performance Development Co., Ltd, Director and General Manager ofJiuzhaigou Tibetan Mystery Culture Co., Ltd and President Assistant of Songcheng Performance Development Co., Ltd, and hasserved as Vice President of the Company since October 2018.
14. Mr. Chen Shengmin: 50 years old, college degree, accountant, Chinese nationality, without permanent residency abroad.From March 2002 to March 2004, Mr. Chen Shengmin served as the lead accountant of Finance Department of the Leyuan Tourism;From April 2004 to February 2005, he served as the Finance Manager of the Leyuan Tourism; From March 2005 to July 2007, heserved as Finance Manager of Landscape Real Estate; He has been Chief Financial Officer of the Company since July 2007 and theSecretary of the board of directors of the Company since May 2017.Position held in shareholders entities
√ Applicable □ Not applicable
Name | Name of shareholder entity | Position held in shareholders entities | Starting date of tenure | Termination Date of tenure | Remuneration and allowance received from a shareholder entity or not? |
Huang Qiaoling | Hangzhou Songcheng Group Holdings Co., Ltd | Executive Director | No | ||
Huang Qiaolong | Hangzhou Songcheng Group Holdings Co., Ltd | Supervisor | No | ||
Huang Hongming | Hangzhou Songcheng Group Holdings Co., Ltd | Executive President | Yes |
Position held in other entities
√ Applicable □ Not applicable
Name | Name of other entity | Position held in other entities | Starting date of tenure | Termination Date of tenure | Renumeration received from other entity or not |
Yu Qinyi | Zhejiang Herui Certified Public Accountants Co., Ltd. | Certified Public Accountant | Yes | ||
Liu Shuzhe | Bank of Hangzhou, CHINT Electrics Co., Ltd., Hangzhou GREENDA Electronic Materials Co., Ltd. | Independent Director | Yes | ||
Xu Jie | Hangzhou World Leisure Expo Park Co., Ltd | Deputy General Manager and Supervisor | Yes |
Incumbent or outgoing directors, supervisors and senior management in the reporting period that have been imposedadministrative penalties by CSRC in the last three years
□ Applicable √ Not applicable
IV. Remuneration of Directors, Supervisors and Senior Management
The following describes the decision-making program, determination basis and actual payment of remuneration for directors,supervisors and senior management.Procedures for making decisions on the remuneration of directors, supervisors and senior management personnel:
remuneration of directors and supervisors is determined by the general meeting of shareholders, while remuneration of seniormanagers is determined by Board of Directors. Directors, supervisors and senior management personnel who perform their dutiesin the Company receive remuneration according to specific positions.
Basis for determining the remuneration of directors, supervisors and senior management personnel: The remuneration ofdirectors, supervisors and senior management personnel shall be determined and distributed according to the Working Rules ofRemuneration and Appraisal Committee of the Board of Directors of the Company, and based on the Company's operatingperformance, their own performance, work ability, post responsibilities and other assessments.
Actual payment of the remuneration of directors, supervisors and senior management personnel: RMB 3,808,500Remuneration of directors, supervisors and senior management in the reporting period of the Company
Unit: ten thousand RMB
Name | Post | Gender | Age | Position status | Total remuneration from the Company before tax | Whether to receive remuneration from related parties or not |
Huang Qiaoling | Chairman | Male | 63 | Incumbent | 62.85 | No |
Huang Qiaolong | Director | Male | 61 | Incumbent | Yes | |
Zhang Xian | Director, President | Female | 48 | Incumbent | 62.85 | No |
Zhang Jiankun | Director, Executive President | Male | 57 | Incumbent | 56.81 | No |
Huang Hongming | Director | Male | 49 | Incumbent | Yes | |
Shang Lingxia | Director, Executive Vice President | Female | 46 | Incumbent | 53.25 | No |
Lanke | Independent Director | Male | 71 | Incumbent | 5 | No |
Liu Shuzhe | Independent Director | Male | 64 | Incumbent | 5 | No |
Yu Qinyi | Independent Director | Female | 41 | Incumbent | 5 | No |
Zhu Hualu | Chairman of the Board of Supervisors | Female | 66 | Incumbent | 5 | No |
Yu Feng | Staff Supervisor | Female | 45 | Incumbent | 33.23 | No |
Xu Jie | Supervisor | Female | 53 | Incumbent | Yes | |
Zheng Qi | Vice President | Male | 44 | Incumbent | 48.96 | No |
Chen Shengmin | CFO and Secretary of the Board | Male | 50 | Incumbent | 42.9 | No |
Total | -- | -- | -- | -- | 380.85 | -- |
Share incentives for the Company's directors, supervisors and senior executives in the reporting period
□ Applicable √ Not applicable
V. Employees in the Company
1. Number, profession composition and educational background of the employees
Number of incumbent employees in the parent company (person) | 143 |
Number of incumbent employees in major subsidiaries (person) | 1,298 |
Total number of incumbent employees (person) | 1,441 |
Number of employees receiving salaries in current period (person) | 1,441 |
Number of retired employees requiring the parent company and major subsidiaries to bear their costs | 0 |
Profession composition | |
Type of profession composition | Number of employees for profession composition (person) |
Production personnel | 451 |
Salesperson | 94 |
Technical personnel | 253 |
Financial personnel | 85 |
Administrative personnel | 75 |
Executive personnel | 192 |
Service personnel | 291 |
Total | 1,441 |
Educational background | |
Type of educational background | Number of employees (person) |
Junior high school and below | 110 |
High school/technical secondary school | 313 |
Junior college | 556 |
Bachelor | 437 |
Master and above | 25 |
Total | 1,441 |
2. Remuneration policies
The Company set up an extensive "H" broadband salary system, which not only provides a promotion channel and platformfor management positions, but also encourages employees to get salary rises through improvement of their skills and
professionalism. We evaluate and adjust employees’ salaries based on the Company's operating performance, employees’ appraisalresults, work performance, social and economic developments, price level and regional differences, and advocate a salaryconfidentiality system.Salary is composed of post salary, various subsidies, benefits and bonuses. The salary of management personnel consists ofbasic salary, post salary, performance salary and allowance; the salary of employee-level positions consists of basic salary,performance salary and allowance. Among them, the basic salary and performance salary are verified according to the managementlevel and performance appraisal scheme, and the performance salary of employees is closely linked with the Company's operatingperformance. The post salaries for the management personnel at supervisor level or above are determined according to theirmanagement level.
3. Training plan
(1) The Company is committed to building a comprehensive talent training system and a scientific talent promotionmechanism to help the Company achieve its strategic goals and continuously improve the all-round ability of its employees. TheCompany provides employees with professional development opportunities, and continuously provides key employees and middleand senior managers who conform to Songcheng's corporate culture and possess excellent professional skills and managementtalents for new projects, which not only provides a platform for talent growth, but also facilitates the healthy development of theCompany. The cultivation and promotion of talents are the main components of the annual KPI for each manager of the Companyand also an important part in assessing the responsibility system of annual business objectives of the company. The Companyattaches great importance to the cultivation of talents, and gives notices of praise and material rewards to subsidiaries that havemade outstanding contributions to the cultivation of talents.
(2) The Company has established a sound staff training system and internal trainer training system, and has formulatedtargeted training programs such as "Induction Training", "Job Skills Training", "General Skills Training" , "Professional Skills UpgradingTraining", "Professional Skills Upgrading Training", "Management Skills Training", "Internal Trainer Training (TTT)", "Songcheng StarTraining Class ", "Artistic Performance and Management", and intensive training classes within each vertical management system.Especially, the "Songcheng Star Training Class" focuses on training excellent managers and outstanding backbone personnel for theCompany, and a number of management backbone personnel have taken up important management positions. The Company hasestablished ten vertical management systems, held vertical management meetings regularly, and carried out various forms oftraining every year to improve the business and management skills of their employees within the system. Each vertical departmentof the Group regularly visits each subordinate company for work inspection every year. In addition to such inspections, the excellentwork experience and cases of each company are also shared within the system. The Company continued to carry out various formsof talent selection examinations and training programs in 2020 to reserve various types of management-oriented talents for theCompany's strategic objectives.
(3) The Company helps the growth of talents through a combination of internal and external trainings. We have cooperatedwith many external professional training institutions to constantly update and strengthen the professional knowledge and practicalskills of our talents in administration, human resources, finance and taxation, marketing, planning, business and management.Moreover, the Company has set up "Songcheng Group Network College" to create a good learning atmosphere for internalemployees to attend online training anytime and anywhere, and the Company also encourages each department to use theexcellent courses broadcast live on the Internet for internal trainings. The Company also encourages employees to improve theiracademic qualifications and participate in professional title and qualification examinations.
(4) The Company has held a variety of theme activities such as "Skills Competition", "Excellent Staff and Management TravelInspection", "Employee Outward Bound", "Staff Four Seasons Theme Activities" and "Internal Trainer Salon Activities" to enrich its
training programs. All skill competition programs, especially the annual skill competition, serve to improve the business skills andcomprehensive skills of employees. Through business skills competition, debate competition, host competition, poetry competition,work innovation and other projects, the Company cultivates talents who can "do, speak, write and innovate".
(5) The Company registered an official corporate culture publicity account named "Songcheng people" on WeChat, so as todisplay various corporate culture activities organized by the Company to employees, and strengthen the publicity of award-winningemployees such as "the Most Beautiful Songcheng people", "Star Employees" and "Excellent Interns", thus creating an excellentcorporate culture atmosphere and advocating all employees to achieve excellence. Employees can also leave messages on WeChat,and any suggestions and opinions about the Company can be sent to the chairman's mailbox. In addition, the Company shallstrengthen the interaction and communication between its management and the employees, and implement excellent and feasiblesuggestions put forward by employees. The WeChat account also has the function of points exchange, employees who have signedin may redeem the corresponding prizes, enabling the employees to focus on and recognize the Company's corporate culture.
4. Labor outsourcing
√ Applicable □ Not applicable
Total hours of labor outsourcing (hours) | 1,210,380 |
Total remuneration paid for labor outsourcing (RMB) | 23,844,490.08 |
Section X Corporate Governance
I. Basic Situation on Corporate GovernanceDuring the reporting period, the Company further improved its corporate governance structure, standardized its operationsand enhanced its corporate governance in strict compliance with the requirements of the Company Law, the Securities Law, theCode of Corporate Governance of Listed Companies, the Stock Listing Rules of the Shenzhen Stock Exchange, the Rules Governing theListing of Stocks on the Growth Enterprise Market of the Shenzhen Stock Exchange and the Requirements of CSRC on relevant lawsand regulations. As at the end of the reporting period, the actual situation of the Company's governance was basically incompliance with the normative documents issued by the CSRC on the governance of listed companies.
1. About Shareholders and Shareholders’ Meetings
The Company convenes and holds shareholders' meetings in strict accordance with the provisions and requirements of theRules for General Meetings of Listed Companies, the Articles of Association and the Rules of Procedure for General Meetings, so asto ensure that all shareholders, in particular the minority shareholders are treated fairly, and fully exercise their rights.
2. About the Company and the Controlling Shareholders
The Company has independent business and operation ability, and is independent of the controlling shareholder in terms ofbusiness, personnel, assets, institutions and finance, and the Company's Board of Directors, Board of Supervisors and internalinstitutions operate independently. The controlling shareholders of the Company can strictly regulate their own conduct and havenot interfered directly or indirectly with the decision-making and operation activities of the Company beyond the shareholders’meetings or the Board of Directors of the Company.
3. About the Directors and the Board of Directors
The Company elects directors in strict accordance with the selection and appointment procedures stipulated in the Articles ofAssociation; the Board of Directors of the Company has nine directors, including three independent directors, accounting forone-third of all directors, and the number and composition of the Board of Directors are in compliance with laws and regulationsand the requirements of the Articles of Association. All directors of the Company shall carry out their work in accordance with theRules of Procedure of the Board of Directors and the Management System of Independent Directors, attend the board meetings andshareholders' meetings timely, actively participate in relevant professional training and familiarize themselves with relevant lawsand regulations.
4. About the Supervisors and Board of Supervisors
The Company shall select supervisors in strict accordance with the relevant provisions of the Company Law and the Articles ofAssociation, etc. The Board of Supervisors of the Company has three supervisors, including one staff supervisor, and the numberand composition of the Board of Supervisors are in compliance with the requirements of laws and regulations. The supervisors ofthe Company are able to perform their duties conscientiously in accordance with the requirements of the Rules of Procedure of theBoard of Supervisors, etc., and effectively supervise and express independent opinions on the Company’s major matters, connectedtransactions, financial position, performance of duties of directors and managers.
5. Performance Evaluation & Incentive and Restraint Mechanism
The Company has gradually established a fair and transparent performance evaluation standards and incentive and restraint
mechanisms for directors, supervisors and senior management (managers), and the appointment of senior management (managers)of the Company is open and transparent and in compliance with the laws and regulations.
6. Relevant stakeholders
The Company fully respects and safeguards the legitimate rights and interests of relevant stakeholders and achieves acoordinated balance of the interests of society, shareholders, the Company and employees to jointly promote the sustainable andsound development of the Company.
7. Information Disclosure and Transparency
The Company has designated the Secretary of the Board of Directors as the person in charge of investor relations managementof the Company, who is responsible for management of information disclosure and investor relations of the Company and receptionof visits and inquiries from shareholders; designated Securities Times, Securities Daily and Cninfo as the newspapers and website forinformation disclosure of the Company, disclosing information truthfully, accurately and timely in strict accordance with the relevantlaws and regulations and ensuring that all shareholders have fair opportunities access to information.Whether the actual status of corporate governance significantly deviates from the regulatory documents issued by the ChinaSecurities Regulatory Commission regarding the governance of listed companies.
□ Yes √ No
There is no significant difference between the actual situation of corporate governance and the regulatory documents on thegovernance of listed companies issued by China Securities Regulatory Commission.II. The company's independence from the controlling shareholders in business, personnel, assets,organization, finance, etc.
Since establishment, the Company has been operating in strict accordance with the requirements of the Company Law, theSecurities Law and other relevant laws and regulations and Articles of Association, and is independent of each other in terms ofbusiness, assets, personnel, organization and finance, and there is no situation in which the Company cannot guarantee itsindependence and maintain its ability to operate independently from its controlling shareholder in terms of business, personnel,assets, organization and finance.III Horizontal competition
□ Applicable √ Not applicable
IV. Relevant Situation of the Annual General Meeting of Shareholders and the ExtraordinaryGeneral Meeting of Shareholders Held in the Reporting Period
1. The shareholders' meetings for this reporting period
Conference Session | Conference Type | Percentage of Investors Involved | Date of Conference | Date of Disclosure | Disclosure Index |
Shareholders' General Meeting in 2019 | Annual General Meeting | 58.04% | Monday, May 18, 2020 | Monday, May 18, 2020 | http://www.cninfo.com.cn/ |
2. Convening of the interim shareholders' general meetings upon request of the preferred stockholders whosevoting rights are restored
□ Applicable √ Not applicable
V. The performance of the duties of independent directors during the reporting period
1. Attendance of independent directors in the board of directors and shareholders' meeting
Attendance of independent directors at the BOD meeting and shareholders' general meetings | |||||||
Name of independent director | Number of board meetings to attend during the reporting period | Number of on-site attendance of board meetings | Number of attendance of board meetings by means of telecommunications | Number of attendance of board meetings by entrusts | Number of absence at board meetings | Whether absent from board meetings in person for two consecutive times | Number of attendance of shareholders' general meetings |
Lanke | 5 | 5 | No | 1 | |||
Liu Shuzhe | 5 | 5 | No | 1 | |||
Yu Qinyi | 5 | 5 | No | 1 |
2. Objections of independent directors to related issues of the company
Whether the independent directors challenge the company's related issues?
□ Yes √ No
During the reporting period, independent directors did not raise objections to the company's related matters.
3. Other information on independent directors' performance of duties
Whether independent director's proposals on the company issues are accepted
√ Yes □ No
Note on the acceptance or rejection of independent director's proposals on company issues.During the reporting period, all reasonable suggestions put forward by the independent directors to the Company have beenadopted.VI. Performance of duties of the special committee under the board of directors during thereporting period
1. Performance of Duties by the Audit Committee
According to the Rules of Work of the Audit Committee of the Board of Directors of the Company, the Audit Committee hasgiven full play to its role of audit and supervision and is mainly responsible for financial supervision and verification work of theCompany, as well as the communication and coordination with external auditors. The Audit Committee verified the internal controlof the Company in 2020 and considered that the internal control system already established by the Company is in compliance with
the relevant regulations and can effectively control the relevant risks. In 2020, the Audit Committee focused on the Company'speriodic financial reports, production and operation control, use of funds raised, and capital appropriation by controllingshareholders and related parties. The Audit Committee conducted a summary and evaluation of the work of the accounting firmengaged in the annual audit of the Company, and put forward the suggestion of renewing the employment of the accounting firm.
2. Performance of Duties of the Remuneration and Appraisal Committee
During the reporting period, the Remuneration and Appraisal Committee of the Board of Directors of the Company diligentlyperformed its duties in accordance with relevant regulations and the provisions of the Articles of Association and the Rules ofProcedure of the Remuneration and Appraisal Committee of the Board of Directors, and reviewed matters such as the remunerationof directors and senior management in 2020.
3. Performance of Duties by the Nomination Committee
During the reporting period, the Nomination Committee of the Board of Directors actively performed its duties in accordancewith relevant regulations and the provisions of Articles of Association and Rules of Procedure of the Nomination Committee of theBoard of Directors, and put forward feasible guidance and requirements for construction of a talent team for sustainabledevelopment of the Company.
4. Performance of Duties by the Strategy Committee
During the reporting period, the Strategy Committee of the Board of Directors reviewed and summarized the implementationof the Company's strategy in accordance with relevant regulations and the provisions of Articles of Association and Rules ofProcedure of the Strategy Committee of the Board of Directors, and timely conducted a study on strategic planning according to themarket situation and the industry in which the Company is engaged in, and put forward reasonable suggestions on implementationof the development strategy according to the actual situation of the Company.VII. Work of the Board of Supervisors
Has Board of Supervisors discovered any risk in the company during the supervision in the reporting period
□ Yes √ No
The Board of Supervisors of the Company has no objection to the supervision matters during the reporting period.VIII. Evaluation and Incentive Mechanisms for Senior Management
In accordance with Remuneration Management System for Directors, Supervisors and Senior Management, the Company hasestablished a performance appraisal and incentive and restraint mechanism linking the remuneration of senior management withthe Company's performance, and the Company has implemented a remuneration system combining basic annual salary andyear-end performance appraisal for senior management.
Based on the achievement of the Company's annual operating objectives and the performance of senior management, theRemuneration and Appraisal Committee of the Board of Directors conducts annual performance appraisal of senior managementand supervises the implementation of the remuneration system. The Company, in turn, pays their annual performance salary andprovides rewards and punishments based on the results of the performance appraisal. The Remuneration and Appraisal Committeeof the Board of Directors of the Company, after assessing the senior management of the Company based on the actual situation,unanimously agreed that the remuneration plan of the senior management of the Company for the year 2020 has strictlyimplemented the remuneration management system of the Company.
IX. Internal Control Assessment Report
1. Details of material weakness in internal control found during the reporting period
□ Yes √ No
2. Internal control self-evaluation report
Date of full-text disclosure for internal control assessment report | Thursday, April 22, 2021 | |
Full-text disclosure index for internal control assessment report | For details, see 2020 Annual Internal Control Self-Evaluation Report published by the company on http://www.cninfo.com.cn on April 22, 2021 | |
Percentage of total asset from units included in the assessment out of the total asset from the company's consolidated financial statements | 63.24% | |
The proportion of operating income of parties included in the assessment to the operating income from the Company's consolidated financial statements | 79.38% | |
Defect identification criteria | ||
Category | Financial Report | Non-financial reports |
Qualitative standards | A material deficiency in internal control over financial reporting is considered to exist if: (1) The Company's control environment is ineffective; (2) Fraud by any of the directors, supervisors and senior management; (3) The Certified Public Accountant finds that there is a material misstatement in the current financial report, however, the Company's internal control fails to detect such misstatement in the course of operation; (4) Ineffective supervision of internal | The Company is deemed to have a material deficiency in internal control not related to financial reporting if the following circumstances occur: (1) The Company's operating activities seriously violate national laws and regulations; (2) Unscientific decision-making procedures, resulting in major mistake in decision-making, which causes significant property losses to the Company; (3) Significant loss of key management personnel or technical personnel; (4) Frequent occurrence of negative news or reports, which aroused great concern of regulatory authorities and cannot be eliminated in a long period of time. Significant deficiency: A deficiency that, alone or in |
control by the Company's Audit Committee and internal audit department. Significant deficiency: A deficiency that, alone or in combination with other deficiencies, is less serious than a material deficiency but may still cause the Company to deviate from its control objectives. General deficiency: Other internal control deficiencies that do not constitute a material deficiency or a significant deficiency. | combination with other deficiencies, is less serious than a material deficiency but may still cause the Company to deviate from its control objectives. General deficiency: Other internal control deficiencies that do not constitute a material deficiency or a significant deficiency. | |
Quantitative standards | Potential misstatement of total profits, material deficiency: misstatement ≥ 5% of total profits; significant deficiency: 2% of total profits ≤ misstatement < 5% of total profits; general deficiency: misstatement < 2% of total profits | Property losses caused by deficiencies, material deficiency: property losses caused by deficiencies ≥ 5% of total profits; significant deficiency: 2% of total profits ≤ property losses caused by deficiencies < 5% of total profits; general deficiency: property losses caused by deficiencies < 2% of total profits |
Number of material weakness in financial reports | 0 | |
Number of material weakness in non-financial reports | 0 | |
Number of significant deficiency in financial reports | 0 | |
Number of significant deficiency in non-financial report | 0 |
X. Internal Control Audit Report or Assurance ReportInternal Control Assurance Report
Deliberations Paragraph in the Internal Control Assurance Report | |
In our opinion, your company has maintained effective internal control related to financial statements in all major aspects in accordance with the Basic Norms of Enterprise Internal Control and relevant regulations promulgated by the five ministries including the Ministry of Finance as at December 31, 2020. This conclusion was formed under the inherent limitations indicated in the assurance report. | |
Disclosure in the Internal Control Assurance Report | Disclosure |
Date of full-text disclosure for the internal control assurance report | Thursday, April 22, 2021 |
Full-text disclosure index for the | For details, please refer to the Internal Control Assurance Report of Songcheng Performance |
internal control assurance report | Development Co., Ltd published by the company on http://www.cninfo.com.cn on April 22, 2021 |
Opinion type in the internal control assurance report | Standard unqualified opinion |
Whether there are material deficiencies in the non-financial reports | No |
Whether the accounting firm has issued an internal control assurance report with modified opinions
□ Yes √ No
Whether the opinions in the internal control assurance report issued by the accounting firm are consistent with those in theself-evaluation report issued by the board of directors
√ Yes □ No
Section XI Corporate BondsWhether the Company has corporate bonds which have been publicly issued and listed on the stock exchange and have notmatured or are not fully redeemed at the approval date of annual reportNo
Section XII Financial Report
I. Audit Reports
Audit opinion type | Standard Unqualified Opinion |
Signature Date of audit report | Thursday, April 22, 2021 |
Name of audit institution | BDO China Shu Lun Pan CPAs (special general partnership) |
Audit report ref. | Xin Kuai Shi Bao Zi [2021] No.ZA11461 |
Name of Certified Public Accountant | Ni Yilin, Jiang Xuelian |
Audit Report Text
Xin Kuai Shi Bao Zi [2021] No.ZA11461
To the shareholders of Songcheng Performance Development Co., Ltd:
I Opinion
We audited the financial statements of Songcheng Performance Development Co., Ltd. (hereinafter referred to asSongcheng Performance), including the consolidated and parent company Balance Sheet as of December 31, 2020, as well as theconsolidated and parent company income Statement, consolidated and parent company Cash Flow Statement, consolidated andparent company Statement of Shareholder's Equity Changes, and notes to relevant financial statements in 2020.
In our opinion, the attached financial statements are prepared in accordance with "Accounting Standards for BusinessEnterprises" in all major aspects, and fairly reflect the financial situation of the merger and the parent company of SongchengPerformance as of December 31, 2020, as well as the operating situation and cash flow of Songcheng Performance and its parentcompany in 2020.
II Basis for Our Opinion
We conducted our audit in accordance with the Auditing Standards for Certified Public Accountants in China. The section of“CPA's Responsibility for Auditing Financial Statements” in the audit report further elaborates on our responsibilities under thesestandards. In accordance with "Code of Professional Ethics for Certified Public Accountants in China", we are independent ofSongcheng Performance and have fulfilled other responsibilities of professional ethics. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our audit opinions.
III Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of thefinancial statements of the current period. These matters were addressed in the context of our audit of the financial statements as awhole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
The key audit matters identified during the audit are summarized as follows:
Key Audit Matters | How the matter was addressed in the audit |
(I) Recognition of revenue | |
Since January 1, 2020, the company has implemented the "Accounting Standards for Business Enterprises No. 14-Revenue" (hereinafter referred to as the "New Revenue Standards") revised by the Ministry of Finance in 2017. The Operating Income of Songcheng Performance is mainly from | The main audit procedures we performed for revenue recognition include: 1. Understand and evaluate the design and operation effectiveness of internal control related to revenue recognition of the company; |
cultural and artistic live performances. According to Note 5 (27) of the financial report, the specific principles for recognition of revenue from cultural and artistic live performances are as follows: The company provides scenic spots and live performance services. Different ticket prices are set according to the types of tourists. Tourists have right to watch live performances at the scenic spot after purchasing tickets and entering the scenic spots. When the ticket amount has been collected or the right to receive payment has been obtained, the revenue should be generated. In 2020, the revenue of cultural and artistic live performances was RMB 636,915,500, accounting for 70.57% of the consolidated total income. Since revenue is one of key performance indicators of the company, there may be inherent risks of the management manipulating revenue recognition in order to achieve specific goals or targets. For this reason, we take revenue recognition as a key issue for audit. | 2. Check the contracts of the company, identify the contract terms and conditions related to the recognition of Operating Revenue, and evaluate if revenue recognition of the company meets the requirements of the new revenue standards; 3. Perform letter verification procedures to verify the Account Receivable balance and Sales Revenue amount for authenticity and completeness; 4. Verify the company revenue for accuracy and completeness by checking the records of the business system or order records from third-party platform; 5. Perform analysis on Operating Revenue, and ensure logical rationality of revenue recognition based on the amount of Operating Revenue, cash flow, and taxes. Analyze reasons for abnormal changes by comparing revenue over the same period. 6. Check the supporting documents related to revenue confirmation by sampling, including: system orders, admission orders, receipts, gate records, ticketing records and other documents to evaluate the occurrence, authenticity and deadline of Operating Revenue. |
(2) Long-term Equity Investment Impairment test of Beijing Huafang Technology Co., Ltd. | |
As listed in Note 7 (8) of the consolidated financial statements, as of December 31, 2020, the company's Long-term Equity Investment in Beijing Huafang Technology Co., Ltd. was originally valued at RMB 3,354,224,700, and provision for Long-term Equity Investment Impairment of RMB 1,861,297,300 was made in the current period, with book value of RMB 1,492,927,400. In our opinion, the amount of Long-term Equity Investments Impairment has a significant impact on the financial statements. The management is required to make significant judgments based on evaluation and testing. Therefore, we recognize the impairment assessment of this asset as a key issue for audit. | Our audit procedures for testing of Long-term Equity Investments Impairment mainly include: 1. Understand and evaluate the effectiveness of the company internal control design and implementation related to Long-term Equity Investments Impairment; 2. Understand and evaluate the operating result and financial position of the invested company, discuss with the management to understand and evaluate the methods used in the testing of Long-term Equity Investments Impairment, including the reasonableness of the assumptions such as future revenue forecast and cash flow discount rate , judgment and evaluation of profitability of the components; 3. Understand and evaluate the assessment specialists, hired by the management, for their competence, professionalism and objectivity; |
IV Other Information
The management of Songcheng Performance (hereinafter referred to as "the management") is responsible for otherinformation. Other information includes the information covered in annual report of Songcheng Performance of Year 2020, but thefinancial statements and our audit report are excluded.
Our opinion on the financial statements does not cover the other information and we do not and will not express any formof assurance conclusion thereon.
In combination with our audit of the financial statements, our responsibility is to read the other information and, in doing so,consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in theaudit, or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other information, weare required to report that fact. We have nothing to report in this regard.
V Responsibilities of Management and Those Charged with Governance for the Financial Statements
The Management is responsible for preparing the financial statements in accordance with the requirements of AccountingStandards for Business Enterprises to achieve a fair presentation, and for designing, implementing and maintaining necessaryinternal control to ensure that the financial statements are free from material misstatements, whether due to frauds or errors.
In preparing the financial statements, the management is responsible for evaluating the ability of going concern ofSongcheng Performance, disclosing the matters related to going concern (if applicable), and applying the going concernassumptions, unless there is a plan for liquidation, operations are terminated or there is no other realistic option .
The management is responsible for monitoring the financial reporting process of Songcheng Performance
VI CPA's Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from materialmisstatement, whether due to fraud or error, and to issue an audit report that includes our opinion. Reasonable assurance is a highlevel of assurance, but is not a guarantee that an audit conducted in accordance with the audit standards will always detect amaterial misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or inthe aggregate, they could reasonably be expected to influence the economic decisions of users made on the basis of these financialstatements.
As part of an audit in accordance with the audit standards, we exercise professional judgment and maintain professionalskepticism throughout the audit. We also:
(1) Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, designand perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide abasis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than one resulting from error,as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
(2) Obtain an understanding of internal control relevant to the audit in order to design appropriate audit procedures, butnot for the purpose of expressing an opinion on the effectiveness of the Company's internal control.
(3) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and relateddisclosures made by the Management.
(4) Conclude on the appropriateness of using the going concern assumption by the Management. At the same time, basedon the obtained audit evidence, a conclusion can be drawn on whether there are material uncertainties in matters or circumstancesthat may cause significant doubt on going concern ability of Songcheng Performance. If we conclude that a material uncertaintyexists, we are required to draw attention in our audit report to the related disclosures in the financial statements or, if suchdisclosures are inadequate, to modify our opinion. Our conclusions are based on the information available up to the date of ouraudit report. However, future events or circumstances may cause Songcheng Performance unable to continue its operations.
(5) Evaluate the overall presentation (including the disclosures), structure and content of the financial statements, andwhether the financial statements fairly reflect the relevant transactions and events.
(6) Obtain sufficient and appropriate audit evidence on financial information of entities or business activities of SongchengPerformance, and issue an audit opinion on consolidated financial statements. We are responsible for guiding, supervising andimplementing the group audit, and remain solely responsible for our audit opinion.
We have communicated with those charged with governance on such matters as the scope of audit as planned, theschedule and material audit findings, including the defects in the internal control that are worth paying attention to found in thisaudit.
We have also provided those charged with governance with a statement on observing the professional ethics related toindependence, and communicated with those charged with governance on all the relationships and other matters that might bereasonably deemed to affect our independence, and relevant preventative measures.
From the matters communicated with those charged with governance, we determine those matters that were of mostsignificance in the audit of the financial statements of the current period and are therefore the key audit matters. We describethese matters in our audit report unless law or regulation precludes public disclosure about the matter or when, in extremely rarecircumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doingso would reasonably be expected to outweigh the public interest benefits of such communication.
(No text below)
BDO China Shu Lun Pan CPAs
Certified Public Accountant:
(Special general partnership) (Project partner)
Certified Public Accountant:
Shanghai, China April 22, 2021
II. Financial StatementsUnits of financial reports in the notes: yuan
1. Consolidated Balance Sheet
Prepared by: Songcheng Performance Development Co., Ltd.
December 31, 2020
Unit: RMB
Item | December 31, 2020 | December 31, 2019 |
Current Assets: | ||
Cash and Bank Balances | 1,337,776,253.98 | 1,785,124,821.87 |
Deposit Reservation for Balance | ||
Loans to Banks and Other Financial Institutions | ||
Trading Financial Assets | 335,217,557.68 | 854,108,086.54 |
Derivative Financial Assets | ||
Note’s receivable | ||
Accounts receivable | 5,887,012.36 | 5,337,855.43 |
Receivables Financing | ||
Prepayments | 21,934,226.54 | 17,221,603.54 |
Premium Receivable | ||
Reinsurance Accounts Receivable | ||
Reinsurance Contract Reserves Receivable | ||
Other Receivables | 50,524,990.69 | 125,573,266.78 |
Including: interest receivable | ||
Dividends Receivable | ||
Buying Back the Sale of Financial Assets | ||
Inventory | 13,424,146.50 | 6,110,221.56 |
Contract Assets | ||
Holding for-sale assets | ||
Non-current Assets Due within 1 Year | ||
Other Current Assets | 148,641,404.47 | 127,570,975.96 |
Subtotal of Current Assets | 1,913,405,592.22 | 2,921,046,831.68 |
Non-current Assets: | ||
Granting of loans and advances | ||
Investment in Creditor's Rights | ||
Investment in Other Creditor's Rights | ||
Long-term Receivables | ||
Long-term Equity Investment | 1,534,539,625.11 | 3,468,596,165.08 |
Investment in Other Equity Instruments | 224,266,596.74 | 300,959,931.64 |
Other Non-current Financial Assets | ||
Investment Property | ||
Fixed Assets | 2,508,754,929.16 | 2,311,251,277.89 |
Projects under Construction | 771,871,563.73 | 370,000,233.10 |
Productive Biological Assets | ||
Oil and gas assets | ||
Right-of-use Assets | ||
Intangible Assets | 1,880,031,922.56 | 1,498,490,129.82 |
Development Expenditure | ||
Goodwill | 11,655,794.87 | 28,078,665.69 |
Long-term unamortized expenses | 323,741,176.89 | 112,440,627.02 |
Deferred Income Tax Assets | 18,485,803.52 | 9,148,452.39 |
Other Non-current Assets | 8,589,826.26 | 21,064,619.27 |
Subtotal of Non-current Assets | 7,281,937,238.84 | 8,120,030,101.90 |
Total Assets | 9,195,342,831.06 | 11,041,076,933.58 |
Current Liabilities: | ||
Short-term loan | ||
Borrowings from the Central Bank | ||
Borrowings from Banks and Other Financial Institutions | ||
Transactional financial liabilities | ||
Derivative Financial Liabilities | ||
Notes Payable | ||
Accounts Payable | 372,476,464.69 | 300,656,879.62 |
Received Prepayments | 12,888,689.05 | 351,733,456.28 |
Contract liabilities | 188,550,237.52 | |
Financial Assets Sold for Repurchase | ||
Deposit Taking and Interbank Deposit | ||
Receiving from Vicariously Traded Securities | ||
Receiving from Vicariously Sold Securities | ||
Payroll payable | 18,817,804.74 | 26,737,888.43 |
Tax Payable | 19,869,808.49 | 22,614,171.64 |
Other Payables | 65,149,971.79 | 63,299,348.02 |
Including: interest payable | ||
Dividends Payable | ||
Service Charge and Commission Payable | ||
Reinsurance Accounts Payable | ||
Holding for-sale liabilities | ||
Non-current Liabilities Due within 1 Year | 12,426,708.33 | |
Other Current Liabilities | 3,513,902.08 | |
Subtotal of Current Liabilities | 693,693,586.69 | 765,041,743.99 |
Non-current Liabilities: | ||
Insurance Contract Reserves | ||
Long-term loan | 282,000,000.00 | |
Bonds Payable | ||
Including: Preferred Stocks | ||
Perpetual Bonds | ||
Lease Liabilities | ||
Long-term Payables | ||
Long-term payroll payable | ||
Expected Liabilities | ||
Deferred Income | 387,619,860.41 | 382,872,318.90 |
Deferred Income Tax Liabilities | 96,769,220.18 | 10,771,548.18 |
Other Non-current Liabilities | ||
Subtotal of Non-current Liabilities | 766,389,080.59 | 393,643,867.08 |
Total Liabilities | 1,460,082,667.28 | 1,158,685,611.07 |
Shareholders' Equity: | ||
Share Capital | 2,614,694,040.00 | 1,452,607,800.00 |
Other Equity Instruments | ||
Including: Preferred Stocks | ||
Perpetual Bonds | ||
Capital Reserves | 1,211,364,214.86 | 2,476,312,069.09 |
Less: Treasury Share | ||
Other Comprehensive Incomes | -63,325,115.75 | -8,681,151.59 |
Special Reserves | ||
Surplus Reserves | 517,673,268.35 | 517,673,268.35 |
General Risk Reserves | ||
Undistributed Profits | 3,131,881,024.60 | 5,176,157,180.79 |
Total Shareholders' Equity Attributable to the Parent Company | 7,412,287,432.06 | 9,614,069,166.64 |
Minority Shareholders' Equity | 322,972,731.72 | 268,322,155.87 |
Total Shareholders' Equity | 7,735,260,163.78 | 9,882,391,322.51 |
Total Liabilities and Shareholders' Equity | 9,195,342,831.06 | 11,041,076,933.58 |
Legal representative: Zhang XianPerson in charge of accounting work: Chen ShengmingPerson in charge of accounting department: Zhu Shana
2. Balance Sheet of the Parent Company
Unit: RMB
Item | December 31, 2020 | December 31, 2019 |
Current Assets: | ||
Cash and Bank Balances | 788,724,841.16 | 645,534,966.84 |
Trading Financial Assets | 351,492,520.54 | |
Derivative Financial Assets | ||
Note’s receivable | ||
Accounts receivable | 38,224.90 | 1,269,835.09 |
Receivables Financing |
Prepayments | 2,031,894.01 | 2,458,855.65 |
Other Receivables | 1,046,160,763.74 | 1,100,294,815.74 |
Including: interest receivable | ||
Dividends Receivable | ||
Inventory | 651,042.56 | 2,465,844.42 |
Contract Assets | ||
Holding for-sale assets | ||
Non-current Assets Due within 1 Year | ||
Other Current Assets | 1,240,658.07 | 1,671,867.65 |
Subtotal of Current Assets | 1,838,847,424.44 | 2,105,188,705.93 |
Non-current Assets: | ||
Investment in Creditor's Rights | ||
Investment in Other Creditor's Rights | ||
Long-term Receivables | ||
Long-term Equity Investment | 6,433,238,270.32 | 6,941,849,814.49 |
Investment in Other Equity Instruments | 214,975,166.42 | 294,665,442.88 |
Other Non-current Financial Assets | ||
Investment Property | ||
Fixed Assets | 1,912,986.88 | 503,463,063.75 |
Projects under Construction | 59,331,122.60 | |
Productive Biological Assets | ||
Oil and gas assets | ||
Right-of-use Assets | ||
Intangible Assets | 3,418,590.95 | 145,128,033.35 |
Development Expenditure | ||
Goodwill | ||
Long-term unamortized expenses | 2,600,000.20 | 10,183,821.75 |
Deferred Income Tax Assets | 15,581,293.31 | 7,476,137.89 |
Other Non-current Assets | 9,838,928.50 | |
Subtotal of Non-current Assets | 6,671,726,308.08 | 7,971,936,365.21 |
Total Assets | 8,510,573,732.52 | 10,077,125,071.14 |
Current Liabilities: | ||
Short-term loan | ||
Transactional financial liabilities | ||
Derivative Financial Liabilities | ||
Notes Payable | ||
Accounts Payable | 1,154,036.06 | 44,171,004.81 |
Received Prepayments | 22,214,761.65 | |
Contract liabilities | ||
Payroll payable | 7,873,282.52 | 12,673,534.31 |
Tax Payable | 1,394,799.62 | 4,818,330.21 |
Other Payables | 2,056,738,130.14 | 1,953,433,149.11 |
Including: interest payable | ||
Dividends Payable | ||
Holding for-sale liabilities | ||
Non-current Liabilities Due within 1 Year | 12,426,708.33 | |
Other Current Liabilities | ||
Subtotal of Current Liabilities | 2,079,586,956.67 | 2,037,310,780.09 |
Non-current Liabilities: | ||
Long-term loan | 282,000,000.00 | |
Bonds Payable | ||
Including: Preferred Stocks | ||
Perpetual Bonds | ||
Lease Liabilities | ||
Long-term Payables | ||
Long-term payroll payable | ||
Expected Liabilities | ||
Deferred Income | 5,620,598.89 | |
Deferred Income Tax Liabilities | 9,983,693.86 | |
Other Non-current Liabilities | ||
Subtotal of Non-current Liabilities | 282,000,000.00 | 15,604,292.75 |
Total Liabilities | 2,361,586,956.67 | 2,052,915,072.84 |
Shareholders' Equity: | ||
Share Capital | 2,614,694,040.00 | 1,452,607,800.00 |
Other Equity Instruments | ||
Including: Preferred Stocks | ||
Perpetual Bonds | ||
Capital Reserves | 1,248,861,998.85 | 2,478,350,525.70 |
Less: Treasury Share | ||
Other Comprehensive Incomes | -38,171,990.42 | 31,870,051.79 |
Special Reserves | ||
Surplus Reserves | 517,673,268.35 | 517,673,268.35 |
Undistributed Profits | 1,805,929,459.07 | 3,543,708,352.46 |
Total Shareholders' Equity | 6,148,986,775.85 | 8,024,209,998.30 |
Total Liabilities and Shareholders' Equity | 8,510,573,732.52 | 10,077,125,071.14 |
3. Consolidated Income Statement
Unit: RMB
Item | 2020 | The Year Of 2019 |
I. Total Operating Revenue | 902,586,125.63 | 2,611,753,208.86 |
Including: Operating Revenue | 902,586,125.63 | 2,611,753,208.86 |
Interest Income | ||
Earned Premiums | ||
Service Charge and Commission Income | ||
II. Total Operating Cost | 740,982,414.36 | 1,147,753,469.26 |
Including: Operating Cost | 352,670,473.42 | 747,189,301.24 |
Interest Expenditures | ||
Service Charge and Commission Expenses | ||
Surrender Value | ||
Net Claims Paid | ||
Net Amount of Withdrawn Reserve for Insurance Liability Contract | ||
Policyholder Dividend Expense | ||
Reinsurance Cost | ||
Taxes and Surcharges | 11,933,497.05 | 36,164,788.45 |
Sales Expenses | 63,649,750.30 | 145,503,636.64 |
Administration expenses | 288,084,167.74 | 188,215,121.23 |
Research and development expense | 37,487,964.00 | 48,424,520.54 |
Financial Expenses | -12,843,438.15 | -17,743,898.84 |
Including: interest expenses | 7,822,986.14 | |
Interest Income | 32,572,127.48 | 22,648,412.21 |
Add: Other income | 34,572,160.23 | 4,285,224.19 |
Investment Income (Mark "-" for Loss) | 14,014,892.30 | 273,166,244.68 |
Including: Investment Income from Affiliates and Joint Ventures | -5,356,968.22 | 72,523,327.47 |
Profits from recognition Termination of Financial Assets at Amortized Cost | ||
Exchange Gains (Mark "-" for Losses) | ||
Profit of Net Exposure Hedging (Mark "-" for Loss) | ||
Incomes from changes in fair value (losses marked with "-") | 247,726.31 | 991,859.52 |
Credit Impairment Losses (Mark "-" for Loss) | -32,739,976.91 | 1,325,984.52 |
Asset Impairment Losses (Mark "-" for Loss) | -1,877,720,155.72 | -17,425,960.27 |
Asset Disposal Income (Mark "-" for Loss) | 676,435.92 | -767,848.08 |
III. Operating Profit (Mark "-" for Loss) | -1,699,345,206.60 | 1,725,575,244.16 |
Add: Non-operating Revenues | 3,242,377.14 | 5,997,838.03 |
Less: Non-operating Expenses | 41,007,879.43 | 101,517,003.90 |
IV. Total Profit (Mark "-" for Total Loss) | -1,737,110,708.89 | 1,630,056,078.29 |
Less: Income Tax Expense | 29,835,169.11 | 265,152,567.09 |
V. Net Profit (Mark "-" for Net Loss) | -1,766,945,878.00 | 1,364,903,511.20 |
i. Classified by operation continuity | ||
1. Net Profit as a Going Concern (Mark "-" for Net Loss) | -1,766,945,878.00 | 1,364,903,511.20 |
2. Net Profit of Discontinued Operation (Mark "-" for Net Loss) | ||
ii. Classified by the attribution of ownership | ||
1. Net Profit Attributable to Shareholders of Parent Company | -1,752,398,009.60 | 1,339,790,994.94 |
2. Minority Shareholders' Profit and Loss | -14,547,868.40 | 25,112,516.26 |
VI. Net Amount of Other Comprehensive Incomes after Tax | -54,643,377.96 | -436,587,617.54 |
Net Amount of Other Comprehensive Incomes after Tax Attributable to the Parent Company's Owner | -54,643,964.16 | -436,587,615.65 |
(1) Other comprehensive income that cannot be reclassified as P/L | -65,726,184.59 | -390,940,031.83 |
1. Re-measure the variation of the defined benefit plan | ||
2. Other comprehensive income that cannot be transferred to P/L under the equity method | 1,356,586.59 | -1,356,586.59 |
3. Changes in the fair value of investment in other equity instruments | -67,082,771.18 | -389,583,445.24 |
4. Changes in the fair value of the credit risk of the enterprise | ||
5. Others | ||
(2) Other comprehensive income that will be reclassified as P/L | 11,082,220.43 | -45,647,583.82 |
1. Other comprehensive income that can be transferred to P/L under the equity method | ||
2. Changes in the fair value of investment in other creditor's rights | ||
3. Financial assets reclassified into other comprehensive income | ||
4. Provisions for the credit impairment of investment in other creditor's rights |
5. Cash flow hedge reserves | ||
6. Currency translation difference | 11,082,220.43 | 7,332,056.43 |
7. Others | -52,979,640.25 | |
Net Amount of Other Comprehensive Incomes After Tax Attributable to Minority Shareholders | 586.20 | -1.89 |
VII. Total Comprehensive Income | -1,821,589,255.96 | 928,315,893.66 |
Total Comprehensive Income Attributable to the Parent Company's Owner | -1,807,041,973.76 | 903,203,379.29 |
Total Comprehensive Income Attributable to Minority Shareholders | -14,547,282.20 | 25,112,514.37 |
VIII. Earnings per Share: | ||
(I) Basic Earnings per Share | -0.6702 | 0.5124 |
(II) Diluted Earnings per Share | -0.6702 | 0.5124 |
In case of business combination under the same control during this period, the net profit realized by the consolidated party beforeconsolidation is: RMB 0, and the net profit realized by consolidated party in the previous period: RMB 0.Legal representative: Zhang XianPerson in charge of accounting work: Chen ShengmingPerson in charge of accounting department: Zhu Shana
4. Income Statement of the Parent Company
Unit: RMB
Item | 2020 | The Year Of 2019 |
I. Operating Revenue | 22,892,751.38 | 792,535,463.92 |
Less: Operating Cost | 19,532,790.64 | 389,275,037.47 |
Taxes and Surcharges | 1,295,426.42 | 7,397,252.10 |
Sales Expenses | 7,343,898.62 | 25,286,850.07 |
Administration expenses | 37,997,214.49 | 60,424,870.69 |
Research and development expense | 4,741,111.89 | 9,017,859.90 |
Financial Expenses | -13,459,704.23 | -8,196,303.54 |
Including: interest expenses | 7,822,986.14 |
Interest Income | 21,565,816.00 | 10,263,021.42 |
Add: Other income | 15,285,586.12 | 2,319,386.38 |
Investment Income (Mark "-" for Loss) | 424,960,373.38 | 1,244,836,304.78 |
Including: Investment Income from Affiliates and Joint Ventures | -2,931,524.95 | 110,867,013.28 |
Profits from Derecognition of Financial Assets at Amortized Cost (Mark "-" for Loss) | ||
Profit of Net Exposure Hedging (Mark "-" for Loss) | ||
Incomes from changes in fair value (losses marked with "-") | -1,492,520.54 | 1,492,520.54 |
Credit Impairment Losses (Mark "-" for Loss) | -32,526,876.92 | -498,499.60 |
Asset Impairment Losses (Mark "-" for Loss) | -1,814,682,876.81 | |
Asset Disposal Income (Mark "-" for Loss) | 17,156.67 | 4,943.75 |
II. Operating Profit (Mark "-" for Loss) | -1,442,997,144.55 | 1,557,484,553.08 |
Add: Non-operating Revenues | 1,103,676.45 | 2,115,939.32 |
Less: Non-operating Expenses | 2,213,333.49 | 58,195,427.29 |
III. Total Profit (Mark "-" for Total Loss) | -1,444,106,801.59 | 1,501,405,065.11 |
Less: Income Tax Expense | 3,112,861.27 | 72,308,087.18 |
IV. Net Profit (Mark "-" for Net Loss) | -1,447,219,662.86 | 1,429,096,977.93 |
(I) Net Profit as a Going Concern (Mark "-" for Net Loss) | -1,447,219,662.86 | 1,429,096,977.93 |
(II) Net Profit of Discontinued Operation (Mark "-" for Net Loss) | ||
V. Net Amount of Other Comprehensive Incomes After Tax | -70,042,042.21 | -374,558,803.16 |
(1) Other comprehensive income that cannot be reclassified as P/L | -70,042,042.21 | -374,558,803.16 |
1. Re-measure the variation of the defined benefit plan | ||
2. Other comprehensive income that cannot be transferred to P/L under the equity method | 37,670.53 | -1,372,268.11 |
3. Changes in the fair value of investment in other equity instruments | -70,079,712.74 | -373,186,535.05 |
4. Changes in the fair value of the credit risk of the enterprise | ||
5. Others | ||
(2) Other comprehensive income that will be reclassified as P/L | ||
1. Other comprehensive income that can be transferred to P/L under the equity method | ||
2. Changes in the fair value of investment in other creditor's rights | ||
3. Financial assets reclassified into other comprehensive income | ||
4. Provisions for the credit impairment of investment in other creditor's rights | ||
5. Cash flow hedge reserves | ||
6. Currency translation difference | ||
7. Others | ||
VI. Total Comprehensive Income | -1,517,261,705.07 | 1,054,538,174.77 |
VII. Earnings per Share: | ||
(I) Basic Earnings per Share | ||
(II) Diluted Earnings per Share |
5. Consolidated Cash Flow Statement
Unit: RMB
Item | 2020 | The Year Of 2019 |
I. Cash Flow Generated by Operational Activities: | ||
Cash from Sales of Merchandise and Provision of Services | 807,841,498.50 | 2,667,025,005.20 |
Net Increase in Customer's Bank Deposits and Interbank Deposits |
Net Increase in Borrowings from the Central Bank | ||
Net Increase in Borrowings from Other Financial Institutions | ||
Cash Arising from Receiving Premiums for the Original Insurance Contract | ||
Net Amount Arising from Reinsurance Business | ||
Net Increase in Deposits and Investments from Policyholders | ||
Cash Arising from Interests, Service Charges and Commissions | ||
Net Increase in Borrowings from Banks and Other Financial Institutions | ||
Net Increase in Repurchase Business Funds | ||
Net Amount of Cash Received from the Vicariously Traded Securities | ||
Tax Refund | 32,176,543.78 | |
Other Received Cashes Related to Operational Activities | 103,772,075.60 | 479,656,404.12 |
Subtotal of cash inflow from operational activities | 943,790,117.88 | 3,146,681,409.32 |
Cash Paid for Merchandise and Services | 144,882,412.49 | 589,412,294.52 |
Net Increase in Loans and Advances to Customers | ||
Net Increase in Deposits with Central Bank and Other Financial Institutions | ||
Cash Paid for Original Insurance Contract Claims | ||
Net increase of funds lent | ||
Cash Paid for Interests, Service Charges and Commissions | ||
Cash Paid for Policy Dividends | ||
Cash Paid to and for Employees | 183,145,317.90 | 240,420,521.04 |
Cash Paid for Taxes and Surcharges | 64,685,320.62 | 414,326,350.84 |
Other Paid Cashes Related to Operational Activities | 157,135,166.93 | 331,070,743.41 |
Subtotal of cash outflow from operational activities | 549,848,217.94 | 1,575,229,909.81 |
Net cash flow generated by operating activities | 393,941,899.94 | 1,571,451,499.51 |
II. Cash Flow from Investment Activities: | ||
Cash Arising from Disposal of Investments | 1,349,803,239.12 | 1,937,501,358.58 |
Cash Arising from Investment Incomes | ||
Net Cash Arising from Disposal of Fixed Assets, Intangible Assets and Other Long-term Assets | 2,136,278.15 | 1,980,388.82 |
Net Cash Arising from Disposal of Subsidiaries and Other Business Units | ||
Other Received Cashes Related to Investment Activities | ||
Subtotal of cash inflow from investment activities | 1,351,939,517.27 | 1,939,481,747.40 |
Cash Paid for Purchase and Construction of Fixed Assets, Intangible Assets and Other Long-term Assets | 1,017,897,394.85 | 813,257,636.27 |
Cash Paid for Investments | 897,276,184.30 | 1,962,519,693.46 |
Net Increase in Pledge Loans | ||
Net Cash Paid for Acquisition of Subsidiaries and Other Business Units | 377,767,506.95 | |
Other Paid Cashes Related to Investment Activities | 345,075,573.87 | |
Subtotal of Cash Outflow from Investment Activities | 2,292,941,086.10 | 3,120,852,903.60 |
Net amount of cash flow generated by investment activities | -941,001,568.83 | -1,181,371,156.20 |
III. Cash Flow from Financing Activities: | ||
Cash Arising from Absorbing Investments | 120,000,000.00 | 13,500,000.00 |
Including: Cash Arising from Subsidiaries Absorbing Investments by Minority Shareholders | 120,000,000.00 | 13,500,000.00 |
Cash Arising from Borrowings | 300,000,000.00 | |
Other Received Cashes Related to Financing Activities | ||
Subtotal of cash inflow from financing activities | 420,000,000.00 | 13,500,000.00 |
Cash Paid for Debts Repayment | 6,000,000.00 | |
Cash Paid for Distribution of Dividends and Profits or Payment of Interests | 300,917,837.81 | 174,312,936.00 |
Including: Dividends and Profits Paid to Minority Shareholders by Subsidiaries | 3,000,000.00 | |
Other Paid Cashes Related to Financing Activities | ||
Subtotal of cash outflow from financing activities | 306,917,837.81 | 174,312,936.00 |
Net cash flow generated by financing activities | 113,082,162.19 | -160,812,936.00 |
IV. Impact of Fluctuation in Exchange Rate on Cash and Cash Equivalents | -9,956,266.67 | 2,494,267.57 |
V. Net Increase in Cash and Cash Equivalents | -443,933,773.37 | 231,761,674.88 |
Add: Cash and Cash Equivalents at the Commencement of the Period | 1,781,710,027.35 | 1,549,948,352.47 |
VI. Cash and Cash Equivalents at the End of the Period | 1,337,776,253.98 | 1,781,710,027.35 |
6. Cash Flow Statement of the Parent Company
Unit: RMB
Item | 2020 | The Year Of 2019 |
I. Cash Flow Generated by Operational Activities: | ||
Cash from Sales of Merchandise and Provision of Services | 21,146,321.04 | 818,461,484.19 |
Tax Refund |
Other Received Cashes Related to Operational Activities | 796,910,713.36 | 741,502,483.61 |
Subtotal of cash inflow from operational activities | 818,057,034.40 | 1,559,963,967.80 |
Cash Paid for Merchandise and Services | 4,428,163.75 | 322,258,340.90 |
Cash Paid to and for Employees | 29,084,333.46 | 53,896,350.21 |
Cash Paid for Taxes and Surcharges | 16,523,204.31 | 109,688,330.05 |
Other Paid Cashes Related to Operational Activities | 655,676,151.74 | 1,041,403,424.51 |
Subtotal of cash outflow from operational activities | 705,711,853.26 | 1,527,246,445.67 |
Net cash flow generated by operating activities | 112,345,181.14 | 32,717,522.13 |
II. Cash Flow from Investment Activities: | ||
Cash Arising from Disposal of Investments | 702,850,832.94 | 854,379,652.38 |
Cash Arising from Investment Incomes | 432,000,000.00 | 618,000,000.00 |
Net Cash Arising from Disposal of Fixed Assets, Intangible Assets and Other Long-term Assets | 36,281.55 | 234,135.90 |
Net Cash Arising from Disposal of Subsidiaries and Other Business Units | ||
Other Received Cashes Related to Investment Activities | ||
Subtotal of cash inflow from investment activities | 1,134,887,114.49 | 1,472,613,788.28 |
Cash Paid for Purchase and Construction of Fixed Assets, Intangible Assets and Other Long-term Assets | 29,624,583.50 | 103,874,516.62 |
Cash Paid for Investments | 692,500,000.00 | 1,130,396,000.00 |
Net Cash Paid for Acquisition of Subsidiaries and Other Business Units | 378,000,000.00 | 190,850,000.00 |
Other Paid Cashes Related to Investment Activities | ||
Subtotal of Cash Outflow from | 1,100,124,583.50 | 1,425,120,516.62 |
Investment Activities | ||
Net amount of cash flow generated by investment activities | 34,762,530.99 | 47,493,271.66 |
III. Cash Flow from Financing Activities: | ||
Cash Arising from Absorbing Investments | ||
Cash Arising from Borrowings | 300,000,000.00 | |
Other Received Cashes Related to Financing Activities | ||
Subtotal of cash inflow from financing activities | 300,000,000.00 | |
Cash Paid for Debts Repayment | 6,000,000.00 | |
Cash Paid for Distribution of Dividends and Profits or Payment of Interests | 297,917,837.81 | 174,312,936.00 |
Other Paid Cashes Related to Financing Activities | ||
Subtotal of cash outflow from financing activities | 303,917,837.81 | 174,312,936.00 |
Net cash flow generated by financing activities | -3,917,837.81 | -174,312,936.00 |
IV. Impact of Fluctuation in Exchange Rate on Cash and Cash Equivalents | ||
V. Net Increase in Cash and Cash Equivalents | 143,189,874.32 | -94,102,142.21 |
Add: Cash and Cash Equivalents at the Commencement of the Period | 645,534,966.84 | 739,637,109.05 |
VI. Cash and Cash Equivalents at the End of the Period | 788,724,841.16 | 645,534,966.84 |
7. Consolidated Statement of Changes in Owners' Equity
Amount of this period
Unit: RMB
Item | 2020 | ||||||||||||
Shareholders' Equity Attributable to the Parent Company's Owner | Minority Shareholders' | Total Shareholders' | |||||||||||
Share Capital | Other Equity Instruments | Capital Reserves | Less: | Other Compre | Special | Surplus Reserve | General | Undistributed | Others | Subtotal |
Preferred Stocks | Perpetual Bonds | Others | Treasury Share | hensive Incomes | Reserves | s | Risk Reserves | Profits | Equity | Equity | |||||
I. Balance at the End of Last Year | 1,452,607,800.00 | 2,476,312,069.09 | -8,681,151.59 | 517,673,268.35 | 5,176,157,180.79 | 9,614,069,166.64 | 268,322,155.87 | 9,882,391,322.51 | |||||||
Add: Changes in Accounting Policies | |||||||||||||||
Correction of Errors in the Previous Period | |||||||||||||||
Consolidated under the Same Control | |||||||||||||||
Others | |||||||||||||||
II. Balance at the Start of This Year | 1,452,607,800.00 | 2,476,312,069.09 | -8,681,151.59 | 517,673,268.35 | 5,176,157,180.79 | 9,614,069,166.64 | 268,322,155.87 | 9,882,391,322.51 | |||||||
III. Increases or Decreases in This Period (Mark "-" for Decreases) | 1,162,086,240.00 | -1,264,947,854.23 | -54,643,964.16 | -2,044,276,156.19 | -2,201,781,734.58 | 54,650,575.85 | -2,147,131,158.73 | ||||||||
(I) Total Comprehe | -56,000,550.75 | -1,752,398,009.60 | -1,808,398,560.35 | -14,547,282.20 | -1,822,945,842.55 |
nsive Income | |||||||||||||||
(II) Shareholders' Contribution and Reduction in Capital | -35,459,327.38 | -35,459,327.38 | 72,197,858.05 | 36,738,530.67 | |||||||||||
1. Common stock invested by the owner | 72,959,327.38 | 72,959,327.38 | |||||||||||||
2. Capital Invested by Holders of Other Equity Instruments | |||||||||||||||
3. Number of Share-based Payments Recorded into Shareholders' Equity | |||||||||||||||
4. Others | -35,459,327.38 | -35,459,327.38 | -761,469.33 | -36,220,796.71 | |||||||||||
(III) Profit Distribution | -290,521,560.00 | -290,521,560.00 | -3,000,000.00 | -293,521,560.00 | |||||||||||
1. Appropriation of Surplus Reserves | |||||||||||||||
2. Appr |
opriation of General Risk Reserves | |||||||||||||||
3. Distribution to Owners (or Shareholders) | -290,521,560.00 | -290,521,560.00 | -3,000,000.00 | -293,521,560.00 | |||||||||||
4. Others | |||||||||||||||
(IV) Internal Carry-forward of Shareholders' Equity | 1,162,086,240.00 | -1,162,086,240.00 | 1,356,586.59 | -1,356,586.59 | |||||||||||
1. Capital Reserves Transferred into Capital (or Share Capital) | 1,162,086,240.00 | -1,162,086,240.00 | |||||||||||||
2. Surplus Reserves Transferred into Capital (or Share Capital) | |||||||||||||||
3. Surplus Reserves Covering Losses | |||||||||||||||
4. Carry-forward retained earnings |
of the variation of the defined benefit plan | |||||||||||||||
5. Other Carry-forward Retained Earnings of the Comprehensive Income | 1,356,586.59 | -1,356,586.59 | |||||||||||||
6. Others | |||||||||||||||
(V) Special Reserves | |||||||||||||||
1. Withdrawal in this period | |||||||||||||||
2. Used in This Period | |||||||||||||||
(VI) Others | -67,402,286.85 | -67,402,286.85 | -67,402,286.85 | ||||||||||||
IV. Balance at the End of This Period | 2,614,694,040.00 | 1,211,364,214.86 | -63,325,115.75 | 517,673,268.35 | 3,131,881,024.60 | 7,412,287,432.06 | 322,972,731.72 | 7,735,260,163.78 |
Amount of Previous Period
Unit: RMB
Item | 2019 | ||||||||||||||
Shareholders' Equity Attributable to the Parent Company's Owner | Minority Shareholders' Equity | Total Shareholders' Equity | |||||||||||||
Share Capital | Other Equity Instruments | Capital Reserves | Less: Treasury Shar | Other Comprehensive Incomes | Special Reserves | Surplus Reserves | General Risk Reserves | Undistributed Profits | Others | Subtotal | |||||
Preferred Stoc | Perpetual Bond | Others |
ks | s | e | |||||||||||||
I. Balance at the End of Last Year | 1,452,607,800.00 | 2,476,312,069.09 | 20,405,965.33 | 351,171,582.73 | 4,170,577,596.34 | 8,471,075,013.49 | 1,217,353,199.38 | 9,688,428,212.87 | |||||||
Add: Changes in Accounting Policies | 407,500,498.73 | -386,862.17 | 3,653,579.35 | 410,767,215.91 | 1,390,396.57 | 412,157,612.48 | |||||||||
Correction of Errors in the Previous Period | |||||||||||||||
Consolidated under the Same Control | |||||||||||||||
Others | |||||||||||||||
II. Balance at the Start of This Year | 1,452,607,800.00 | 2,476,312,069.09 | 427,906,464.06 | 350,784,720.56 | 4,174,231,175.69 | 8,881,842,229.40 | 1,218,743,595.95 | 10,100,585,825.35 | |||||||
III. Increases or Decreases in This Period (Mark "-" for Decreases) | -436,587,615.65 | 166,888,547.79 | 1,001,926,005.10 | 732,226,937.24 | -950,421,440.08 | -218,194,502.84 | |||||||||
(I) Total Comprehensive Income | -433,251,121.70 | 1,339,790,994.94 | 906,539,873.24 | 25,112,514.37 | 931,652,387.61 |
(II) Shareholders' Contribution and Reduction in Capital | -975,533,954.45 | -975,533,954.45 | |||||||||||||
1. Common stock invested by the owner | 13,500,000.00 | 13,500,000.00 | |||||||||||||
2. Capital Invested by Holders of Other Equity Instruments | |||||||||||||||
3. Number of Share-based Payments Recorded into Shareholders' Equity | |||||||||||||||
4. Others | -989,033,954.45 | -989,033,954.45 | |||||||||||||
(III) Profit Distribution | 166,888,547.79 | -341,201,483.79 | -174,312,936.00 | -174,312,936.00 | |||||||||||
1. Appropriation of Surplus Reserves | 166,888,547.79 | -166,888,547.79 | |||||||||||||
2. Appropriation of General |
Risk Reserves | |||||||||||||||
3. Distribution to Owners (or Shareholders) | -174,312,936.00 | -174,312,936.00 | -174,312,936.00 | ||||||||||||
4. Others | |||||||||||||||
(IV) Internal Carry-forward of Shareholders' Equity | -3,336,493.95 | 3,336,493.95 | |||||||||||||
1. Capital Reserves Transferred into Capital (or Share Capital) | |||||||||||||||
2. Surplus Reserves Transferred into Capital (or Share Capital) | |||||||||||||||
3. Surplus Reserves Covering Losses | |||||||||||||||
4. Carry-forward retained earnings of the variation |
of the defined benefit plan | |||||||||||||||
5. Other Carry-forward Retained Earnings of the Comprehensive Income | -3,336,493.95 | 3,336,493.95 | |||||||||||||
6. Others | |||||||||||||||
(V) Special Reserves | |||||||||||||||
1. Withdrawal in this period | |||||||||||||||
2. Used in This Period | |||||||||||||||
(VI) Others | |||||||||||||||
IV. Balance at the End of This Period | 1,452,607,800.00 | 2,476,312,069.09 | -8,681,151.59 | 517,673,268.35 | 5,176,157,180.79 | 9,614,069,166.64 | 268,322,155.87 | 9,882,391,322.51 |
8. Statement of Changes in Owners' Equity of the Parent Company
Amount of this period
Unit: RMB
Item | 2020 | |||||||||||
Share Capital | Other Equity Instruments | Capital Reserves | Less: Treasury Share | Other Comprehensive Incomes | Special Reserves | Surplus Reserves | Undistributed Profits | Others | Total Shareholders' Equity | |||
Preferred Stocks | Perpetual Bonds | Others |
I. Balance at the End of Last Year | 1,452,607,800.00 | 2,478,350,525.70 | 31,870,051.79 | 517,673,268.35 | 3,543,708,352.46 | 8,024,209,998.30 | ||||||
Add: Changes in Accounting Policies | ||||||||||||
Correction of Errors in the Previous Period | ||||||||||||
Others | ||||||||||||
II. Balance at the Start of This Year | 1,452,607,800.00 | 2,478,350,525.70 | 31,870,051.79 | 517,673,268.35 | 3,543,708,352.46 | 8,024,209,998.30 | ||||||
III. Increases or Decreases in This Period (Mark "-" for Decreases) | 1,162,086,240.00 | -1,229,488,526.85 | -70,042,042.21 | -1,737,778,893.39 | -1,875,223,222.45 | |||||||
(I) Total Comprehensive Income | -70,079,712.74 | -1,447,219,662.86 | -1,517,299,375.60 | |||||||||
(II) Shareholders' Contribution and Reduction in Capital | ||||||||||||
1. Common stock invested by the owner | ||||||||||||
2. Capital Invested by Holders of Other Equity |
Instruments | ||||||||||||
3. Number of Share-based Payments Recorded into Shareholders' Equity | ||||||||||||
4. Others | ||||||||||||
(III) Profit Distribution | -290,521,560.00 | -290,521,560.00 | ||||||||||
1. Appropriation of Surplus Reserves | ||||||||||||
2. Distribution to Owners (or Shareholders) | -290,521,560.00 | -290,521,560.00 | ||||||||||
3. Others | ||||||||||||
(IV) Internal Carry-forward of Shareholders' Equity | 1,162,086,240.00 | -1,162,086,240.00 | 37,670.53 | -37,670.53 | ||||||||
1. Capital Reserves Transferred into Capital (or Share Capital) | 1,162,086,240.00 | -1,162,086,240.00 | ||||||||||
2. Surplus Reserves Transferred into Capital (or Share Capital) | ||||||||||||
3. Surplus Reserves |
Covering Losses | ||||||||||||
4. Carry-forward retained earnings of the variation of the defined benefit plan | ||||||||||||
5. Other Carry-forward Retained Earnings of the Comprehensive Income | 37,670.53 | -37,670.53 | ||||||||||
6. Others | ||||||||||||
(V) Special Reserves | ||||||||||||
1. Withdrawal in this period | ||||||||||||
2. Used in This Period | ||||||||||||
(VI) Others | -67,402,286.85 | -67,402,286.85 | ||||||||||
IV. Balance at the End of This Period | 2,614,694,040.00 | 1,248,861,998.85 | -38,171,990.42 | 517,673,268.35 | 1,805,929,459.07 | 6,148,986,775.85 |
Amount of Previous Period
Unit: RMB
Item | 2019 | |||||||||||
Share Capital | Other Equity Instruments | Capital Reserves | Less: Treasury Share | Other Comprehensive Incomes | Special Reserves | Surplus Reserves | Undistributed Profits | Others | Total Shareholders' Equity | |||
Preferred Stocks | Perpetual Bonds | Others | ||||||||||
I. Balance at the End of Last Year | 1,452,607,80 | 2,478,350,525. | 351,171,582.73 | 2,219,490,436.39 | 6,501,620,344.82 |
0.00 | 70 | |||||||||||
Add: Changes in Accounting Policies | 405,094,257.37 | -386,862.17 | -3,481,759.53 | 401,225,635.67 | ||||||||
Correction of Errors in the Previous Period | ||||||||||||
Others | 1,334,597.58 | 23,978,850.00 | 215,809,649.94 | 241,123,097.52 | ||||||||
II. Balance at the Start of This Year | 1,452,607,800.00 | 2,478,350,525.70 | 406,428,854.95 | 374,763,570.56 | 2,431,818,326.80 | 7,143,969,078.01 | ||||||
III. Increases or Decreases in This Period (Mark "-" for Decreases) | -374,558,803.16 | 142,909,697.79 | 1,111,890,025.66 | 880,240,920.29 | ||||||||
(I) Total Comprehensive Income | -374,543,121.64 | 1,429,096,977.93 | 1,054,553,856.29 | |||||||||
(II) Shareholders' Contribution and Reduction in Capital | ||||||||||||
1. Common stock invested by the owner | ||||||||||||
2. Capital Invested by Holders of Other Equity Instruments | ||||||||||||
3. Number of Share-based Payments Recorded into Shareholders' Equity |
4. Others | ||||||||||||
(III) Profit Distribution | 142,909,697.79 | -317,222,633.79 | -174,312,936.00 | |||||||||
1. Appropriation of Surplus Reserves | 142,909,697.79 | -142,909,697.79 | ||||||||||
2. Distribution to Owners (or Shareholders) | -174,312,936.00 | -174,312,936.00 | ||||||||||
3. Others | ||||||||||||
(IV) Internal Carry-forward of Shareholders' Equity | -15,681.52 | 15,681.52 | ||||||||||
1. Capital Reserves Transferred into Capital (or Share Capital) | ||||||||||||
2. Surplus Reserves Transferred into Capital (or Share Capital) | ||||||||||||
3. Surplus Reserves Covering Losses | ||||||||||||
4. Carry-forward retained earnings of the variation of the defined benefit plan | ||||||||||||
5. Other Carry-forward Retained Earnings of the Comprehensive Income | -15,681.52 | 15,681.52 | ||||||||||
6. Others |
(V) Special Reserves | ||||||||||||
1. Withdrawal in this period | ||||||||||||
2. Used in This Period | ||||||||||||
(VI) Others | ||||||||||||
IV. Balance at the End of This Period | 1,452,607,800.00 | 2,478,350,525.70 | 31,870,051.79 | 517,673,268.35 | 3,543,708,352.46 | 8,024,209,998.30 |
III. Basic Information about the CompanySongcheng Performance Development Co., Ltd. (it was previously named as Hangzhou Songcheng Tourism Development Co.,Ltd., hereinafter referred to as the "Company"), formerly known as Hangzhou Songcheng Group Co., Ltd. (before the change, it wasHangzhou Worldland·Songcheng Real Estate Co., Ltd). On December 27, 2000, with the approval document of Zhejiang [2000] No.69 "Official Reply on the Approval for Alteration and Establishment of Hangzhou Song Cheng Tourism Development Co., Ltd.", whichwas issued by Leading Group for Enterprise Listing of Zhejiang Provincial People's Government, Hangzhou Songcheng Group Co., Ltd.approved and contributed net assets of RMB 60 million (audited on November 30, 2000) which was converted into a total of 60million shares at the ratio of 1:1, to alter and establish Hangzhou Songcheng Tourism Development Co., Ltd. (The company changedits name as Songcheng Performance Development Co., Ltd on April 18, 2014). The company registered capital was RMB 60 million.This overall change was verified by Shu Lun Pan Changjiang CPAs Co. Ltd. (now renamed as BDO China Shu Lun Pan CPAs (specialgeneral partnership)) and No. 20370 [2000] Xinchang kuaishibaozi "Capital Verification Report"was issued accordingly. OnDecember 28, 2000, the company obtained the "Corporate Legal Person Business License" with the registration number3301002004635 issued by the Hangzhou Administration for Industry and Commerce. The registered capital was RMB 60 million andthe legal representative was Huang Qiaoling. In 2001, the company changed its industry and commerce registration authority toZhejiang Administration for Industry and Commerce, and obtained the updated business license with registration number of3300001008413. In 2008, Zhejiang Administration for Industry and Commerce changed the numbers uniformly, for which thecompany business license registration number was changed to 330000000019888. In 2015, under the official policy "Fivecertificates into one", the company business license registration number was changed to "Unified Social Credit Code91330000143102311G (1/1).
On October 10, 2004, shareholder Zeng Yingjiu transferred 2 million shares to Huang Qiaoling and the company went throughthe procedures for industrial and commercial registration change on October 20, 2004. On December 31, 2004, shareholder CaiJianxi transferred 1.65 million shares to Huang Qiaoling, and the company went through the procedures for industrial andcommercial registration change on April 11, 2005. On February 22, 2008, shareholder Cai Jianxi transferred 1.65 million shares toZhang Huibing, and the company went through the procedures for industrial and commercial registration change on March 26, 2008.On June 18, 2009, new shareholder East Sky Venture Capital Co., Ltd (formerly named as East Sky Culture Communication
Investment Co., Ltd.), at 10 times of diluted price-earnings ratio based on the net profit attributed to the parent company afterdeducting non-recurring gains & losses as of December 31, 2008, invested total of RMB 30,977,421.35, of which RMB 3 million ofregistered capital paid and RMB 27,977,421.35 of share premium paid. The registered capital of the company after change was RMB63 million. On June 23, 2009, the company completed industrial and commercial registration change.On December 21, 2009, the company, in accordance with amended Articles of Association and the resolution of the FifthExtraordinary General Meeting of Shareholders of Year 2009, applied 63 million shares at the end of the third quarter of Year 2009and distributed the Undistributed Profits to all shareholders at the rate of 10 bonus shares (excluding tax) for every 10 shares. Totalof 63 million additional shares of capital were added. After the conversion, the company Registered Capital was RMB 126 millionThe company completed the industrial and commercial registration change on December 24, 2009.
According to the Resolution of Company Annual General Meeting of Shareholders of Year 2009, and the approval document No.1632 [2010]"Official Reply on Approval of Hangzhou Songcheng Tourism Development Co., Ltd. Initial Public Offering and Listing onthe Growth Enterprise Market” issued by China Securities Regulatory Commission (CSRC), 42 million new shares were issued topublic. The issue price per share was RMB 53, and the total amount of funds raised was RMB 2,226 million. After deducting thepayment of RMB 97,579,000 for issuance costs, the net amount of funds raised was RMB 2,128,421,000, of which the Share Capitalwas RMB 42 million and the Capital Premium was RMB 2,086,421,000. After the change, the registered capital of the company wasRMB 168 million. The company completed the procedure for industrial and commercial registration change on December 15, 2010.
According to the Resolution of Company Annual General Meeting of Shareholders of Year 2010 and the revised Articles ofAssociation, the company, based on its total capital of 168 million shares at the end of 2010, transferred 12 additional shares per 10shares from the Capital Reserves to all shareholders. Total of 201.6 million additional shares were added. The company registeredcapital was RMB 369.6 million after change. The company completed the industrial and commercial registration change on Thursday,June 2, 2011.
According to the Resolution of Company Annual General Meeting of Shareholders of Year 2011 and the revised Articles ofAssociation, the company, based on its total capital of 369.6 million shares at the end of 2011, transferred 5 additional shares forevery 10 shares from the capital reserves to all shareholders. Total of 184.8 million additional shares were added. The companyregistered capital was RMB 554.4 million after change. The company completed the industrial and commercial registration changeon Tuesday, May 29, 2012.
According to "Restricted Stock Incentive Plan of Hangzhou Songcheng Tourism Development Co., Ltd. Revision (Draft)" whichwas reviewed and approved in the Resolution of First Extraordinary General Meeting of Shareholders of Year 2013 held on April 10,2013, "Proposal on Adjusting the Company Restricted Stock Incentive Plan" and "Proposal on Granting Restricted Stock to IncentiveObjects" which was reviewed and approved in the 32nd Meeting of Company Fourth Board of Directors held on May 2, 2013, thecompany granted 3,816,000 restricted shares to 144 senior management personnel and technical (business) backbone for the firsttime. The first date of restricted shares granted was on May 2, 2013, with a grant price of RMB 6.28, adjusted to RMB 6.13 per shareafter deducting RMB 0.15 (distribution of dividends). The company received RMB 23,392,080 contributions by 144 people. Theregistered capital increased by RMB 3,816,000 and capital reserves increased by RMB 195,760,800. The registered capital of thecompany was RMB 558,216,000 after change. The company completed the industrial and commercial registration change on
Monday, June 3, 2013.According to the Resolution of the Third Meeting of Fifth Company Board of Directors held on November 14, 2013, andResolution of the First Extraordinary General Meeting of Shareholders of Year 2013 held on December 2, 2013, the company appliedfor repurchase and cancellation of the first-granted shares to 7 employees who had resigned. The registered capital decreased byRMB 401,000, and the capital reserves decreased by RMB 2,057,130. The registered capital was RMB 557,815 thousand afterchange. The company completed the industrial and commercial registration change on Monday, December 30, 2013.According to the Resolution of the Eight Meeting of Fifth Company Board of Directors held on April 10, 2014 and the SecondExtraordinary General Meeting of Shareholders of Year 2014 held on April 25, 2014, the company applied share repurchase andcancellation for the first shares granted of 3 employees who had resigned The registered capital decreased by RMB 40 thousand,and the capital reserves decreased by RMB 205.2 thousand. The registered capital was RMB 557,775 thousand after change. Thecompany completed the industrial and commercial registration change on Thursday, June 26, 2014.According to the Resolution of the 17th Meeting of Fifth Company Board of Directors held on February 26, 2015 and theResolution of General Meeting of Shareholders of Year 2014 held on April 3, 2015, the company applied share repurchase andcancellation for the first shares granted of 6 employees who had resigned. The registered capital decreased by RMB 84,800, and thecapital reserves decreased by RMB 426,544. The registered capital was RMB 557,690.2 thousand after change. The companycompleted the industrial and commercial registration change on Friday, May 22, 2015.According to the Resolution of the 18th Meeting of Fifth Company Board of Directors held on March 17, 2015, and theResolution of the First Extraordinary General Meeting of Shareholders of Year 2015 held on April 2, 2015, and the approvaldocument” Official Reply on Approval of Songcheng Performance Development Co., Ltd to Issue Shares to Liu Yan and Others toPurchase Assets and Raise Funds"(NO.1725 Securities License (2015)) which approved by CSRC on July 20, 2015, the companyissued non-public offering of 36,701,332 ordinary shares to 8 natural persons including Liu Yan, in order to purchase 38% equity ofBeijing Huafang Technology Co., Ltd. (formerly known as Beijing Six Rooms Technology Co., Ltd.) held by the above-mentionednatural persons. The par value per share was RMB 1.00, and the issue price was RMB 26.92 per share. The total amount of fundsraised was RMB 988 million. The registered capital increased by RMB 36,701.332 thousand, and the capital reserves was increasedby RMB 951,298,668.00. The registered capital was RMB 594,391,532 after change. The company completed the industrial andcommercial registration change on Monday, August 10, 2015.
According to the Resolution of Company Annual General Meeting of Shareholders of Year 2015 and the revised Articles ofAssociation, the company, based on its total capital of 594,391,532 shares, transferred 14.073809 additional shares for every 10shares from the capital reserves to all shareholders. Total of 836,535,289 additional shares were added. The registered capital wasRMB 1,430,926,821 after change. The company completed the industrial and commercial registration change on Thursday,September 17, 2015.According to the Resolution of the 18th Meeting of Fifth Company Board of Directors held on March 17, 2015, and theResolution of the First Extraordinary General Meeting of Shareholders of Year 2015 held on April 2, 2015, and the 28th Meeting ofFifth Board of Directors held on Sept. 24, 2015. with the approval document "Official Reply on Approval of Songcheng Performance
Development Co., Ltd to Issue Shares to Liu Yan and Others to Purchase Assets and Raise Funds"(NO.1725 Securities License (2015))issued by CSRC on July 20, 2015 , the company issued shares to no more than 5 specific investors in private to raise funds, and thetotal amount of funds raised should not exceed RMB 650 million. The company actually issued 21,753,681 ordinary shares (A shares)to three institutional investors at RMB 29.88 per share. After deducting the underwriting expenses and various issuance expenses ofthe underwriters, the actual net funds raised was RMB 632,949,988.28, of which registered capital increased by RMB 21,753,681.00,and the capital premium was RMB 611,196,307.28. The registered capital was RMB 1,452,680,502 after change. The companycompleted the industrial and commercial registration change on Thursday, December 31, 2015.According to the Resolution of the 31st Meeting of Fifth Board of Directors held on February 26, 2016 and the resolution ofAnnual General Meeting of Shareholders of Year 2015 held on March 22, 2016, the company applied for share repurchase andcancellation for the first-granted shares to 4 employees who had resigned. The registered capital decreased by RMB 66,925, and thecapital reserves decreased by RMB 96,539. The registered capital was RMB 1,452,613,577 after change. The company completedthe industrial and commercial registration change on Thursday, May 5, 2016.According to the Resolution of the Eighth meeting of Company Sixth Board of Directors held on February 27, 2017 and theAnnual General Meeting of Shareholders of Year 2016 held on March 24, 2017, the company applied for repurchase andcancellation of the first-granted shares to one employee who had resigned. The registered capital decreased by RMB 5,777, and thecapital reserves decreased by RMB 7,914.49. The registered capital was RMB 1,452,607.8 thousand after change. The companycompleted the industrial and commercial registration change on Tuesday, June 6, 2017.According to the Resolution of the Eighth Meeting of Sixth Board of Directors held on April 27, 2020 and the Annual GeneralMeeting of Shareholders of Year 2019 held on May 18 2020, the company, based on its total capital of 1,430,926,821 shares,transferred 8 additional shares for every 10 shares from the Capital Reserves to all shareholders. Total of 1,162,086,240 additionalshares were added. The registered capital was RMB 2,614,694,040 after change. The company completed the industrial andcommercial registration change on Friday, August 14, 2020.As of December 31, 2020, the company had issued a total of 2,614,694,000 shares, and the registered capital was RMB2,614,694,040. The unified social credit code for Business License of Corporate Legal Person: 91330000143102311G, Registeredaddress: No. 148 Zhijiang Road, Hangzhou, Headquarter Address: No. 148 Zhijiang Road, Hangzhou. The business scope includes:
singing and dancing performance, acrobatics performance, opera performance, music performance, comprehensive artisticperformance (operated within the scope of "Business Performance License"), performance and brokerage business (operated withinthe scope of "Business Performance License"), catering service (See "Catering Service License" for details), and parking service.Tourism services, theme park development and management, planning and organization of cultural activities, culturalcommunication planning, animation design, exhibition organization, investment in and development of leisure industry, industrialinvestment, tourism e-business, design, production, agency, and release of various domestic advertisements, film and televisionprojects Investment and management, tourism products and arts &crafts (excluding gold jewelry), general merchandise, nativeproducts (excluding food) sales, publication wholesale and retail (operating with a license); the business scope of subsidiariesincluded. (For items subject to approval according to law, business activities can only be carried out after approval by relevant
departments)
The company currently hasSongcheng tourist areas in 7 different regions, including Hangzhou Songcheng Tourist Area(operated by Hangzhou Songcheng), Hangzhou Paradise, three Crazy Apple Land Tourist Area; Sanya Romance Park (operated bySanya Songcheng); Lijiang Romance Park (operated by Lijiang Songcheng); Jiuzhai Romance Park and the Tibetan MysteryTheater(operated by Jiuzhai Songcheng); Guilin Romance Park (operated by Guilin Songcheng); Zhangjiajie Romance Park (operatedby Zhangjiajie Songcheng); Xian Romance Park (operated by Xian Songcheng). The current business of the company also extends tothe planning and design of scenic parks, scenic cable car transportation, and Internet video industry. The registered address of thecompany and headquarters office address: No. 148, Zhijiang Road, Hangzhou City.The basic organizational structure of the company: the highest authority of the company is the General Meeting ofShareholders, with implementation of the president responsibility system under the leadership of the Board of Directors. Somefunctional departments are set up to meet the needs of business development, such as the Administration Department, AuditDepartment, Human Resources Department, Securities Investment Department, Financial Management Department, DesignDepartment, Brand Planning Department, Engineering Management Department, Cost Management Department, PurchasingDepartment, Project Development Department, Innovation Department, Outdoors Advertising Department, Art Troupe,Commercial Development Management Center, Office of Chairman, and Marketing Department.The parent company of the company is Hangzhou Songcheng Group Holdings Co., Ltd, and the actual controller of the companyis Huang Qiaoling.
This financial statement has been approved by Board of Directors on April 22, 2021.
As of the subsidiaries listed in the consolidated financial statements of the company are as follows:
Name of Subsidiaries |
Hangzhou Paradise Co., Ltd. |
Sanya Romance Tourism Performance Co., Ltd. |
Lijiang Chama Ancient City Tourism Development Co., Ltd |
Aba Zhou Jiuzhai Romance Tourism Development Co., Ltd |
Hangzhou Songcheng Tourism Development Co., Ltd |
Hangzhou Songcheng Dumuqiao Travel Services Co., Ltd |
Jiuzhaigou Tibetan Mystery Culture Co., Ltd |
Zhejiang Songcheng Longquan Mountain Tourism Development Co., Ltd |
Hangzhou Songcheng Technology Development Co., Ltd. |
Songcheng Performance International Development Co., Ltd. |
Songcheng (Australia) Holdings Pty Ltd |
Name of Subsidiaries |
Songcheng (Australia) Entertainment Pty Ltd. |
Shanghai Songcheng World Expo Performance Development Co., Ltd |
Songcheng Performance Development (Shanghai) Co., Ltd. |
Guilin Lijiang Romance Performance Development Co., Ltd |
Ningxiang Songcheng Tourism Development Co., Ltd. |
Zhangjiajie Romance Performance Development Co., Ltd |
Songcheng Technology Development Co.,Ltd. |
Songcheng Tourism Development Co., Ltd. |
Songcheng Performance Management Co., Ltd. |
Songcheng Dumuqiao Network Co., Ltd. |
Xi'an Romance Performance Development Co., Ltd |
Zhejiang Songcheng Xitang Performance Valley Performance Development Co., Ltd |
Foshan South Sea Qiao Mountain Cultural Tourism Development Co., Ltd |
Hangzhou Songguo Cultural Creative Co., Ltd. |
Hangzhou Songcheng performance Valley technology and Culture Development Co., Ltd |
Songcheng Holdings (Thailand) Co., Ltd. |
Songcheng (Pattaya) International Culture Co., Ltd. |
Zhuhai Songcheng Performance Kingdom Co., Ltd |
Zhuhai Southern Film and Television Cultural Industry Co., Ltd. |
Zhuhai Huayin Landscaping Co., Ltd. |
Songcheng Brand Management Co., Ltd. |
Romance Show Management Co., Ltd. |
For details of the scope and changes of the consolidated financial statements of the current period, please refer to Notes VIII"Changes in the Scope of Consolidation" and Notes IX "Equity in Other Entities.IV. Basis for Preparing the Financial Statement
1. Basis for the preparation
The financial statements are prepared in accordance with the "Accounting Standards for Business Enterprises-Basic Standards"
and related specific accounting standards issued by the Ministry of Finance, Guidelines for Application of Accounting Standards forBusiness Enterprises", “Interpretation of Accounting Standards for Business Enterprises and other relevant provisions" (hereinaftercollectively referred to as the "Accounting Standards for Business Enterprises"), and "No. 15 of the Rules on Information Disclosureand Reporting of the Companies Issuing Securities Publicly" issued by CSRC.
2. Going concern
There is no matter or circumstance that would cause material doubt about the company ability of going concern in future 12months since the end of the reporting period.V. Significant Accounting Polices and Accounting Estimates
1. Statement on compliance with Accounting Standards for Business Enterprises
This financial statement is in compliance with the requirements in the Accounting Standards for Business Enterprisespromulgated by the Ministry of Finance and presents truly and completely the financial position of the merged companies and theparent company as at December 31, 2020 and the operating results and cash flows of the merger and the parent company in 2020.
2. Accounting period
An accounting year commences on January 1 and ends on December 31 of the Gregorian calendar.
3. Operating cycle
The Company's operating cycle is 12 months.
4. Functional currency
The company uses RMB as the standard currency for bookkeeping.
5. The accounting treatment of business combinations involving enterprises under common control andbusiness combinations not involving enterprises under common control
The assets and liabilities acquired by the combining party from the business combination (including the goodwill generated bythe ultimate controlling party's acquisition of the combined party) shall be measured on the basis of the book value of the assetsand liabilities of the combined party in the consolidated financial statements of ultimate controlling party on the combination date.The difference between the book value of the net assets obtained and the book value of the consideration paid for the combination(or total nominal value of the issued shares) is adjusted to capital premium in capital reserve. Adjustments shall be made toretained earnings in the event that the share premiums in the capital reserves are not sufficient for write-down.
Business combination under different control: The cost of combination is the fair value of the assets, liabilities incurred orassumed, and equity securities issued by the acquiring party to obtain the control right of the acquired party on the acquisition date.Where the cost of combination is higher than the fair value of the identifiable net assets acquired from the merging party inbusiness combination, such difference shall be recognized as goodwill; where the cost of combination is less than the fair value ofthe identifiable net assets acquired from the merging party in business combination, such difference shall be charged to the profitor loss for the period. The identifiable assets, liabilities and contingent liabilities obtained by the acquiring party that meet the
recognition conditions should be measured at fair value of the acquisition date.The fees which are directly related to the business combination shall be recognized as the profit or loss in the period when thecosts are incurred; the transaction expenses of issuing equity securities or debt securities for business merger shall be initiallycapitalized for equity securities or debt securities.
6. Preparation method of consolidated financial statements
(1) Scope of Consolidation
The consolidation scope of consolidated financial statements is determined on the basis of control, which includes thecompany and all of its subsidiaries. Control means that the Company has the rights over the investee, enjoys variable returnsthrough participating in relevant activities of the investee, and has the ability to influence the amount of returns by exercising itsrights over the investee.
(2) Procedures of Consolidation
The company regards the whole group as an accounting entity and prepares consolidated financial statements in accordancewith unified accounting policies, in order to reflect the overall financial position, operating results and cash flow of the group. Theinfluence of internal transactions between the Company and the Subsidiaries and between the Subsidiaries shall be offset. Whereinternal transaction indicates the occurrence of impairment loss to relevant assets, such loss shall be recognized in full. In preparingthe consolidated financial statements, where the accounting policies and the accounting periods are inconsistent between theCompany and subsidiaries, the financial statements of subsidiaries are adjusted in accordance with the accounting policies andaccounting period of the Company.
The owner's equity, the net profit or loss and the comprehensive income attributable to minority shareholders of a subsidiaryof the current period are presented separately under the owners' equity in the consolidated balance sheet, the net profit and thetotal comprehensive income in the consolidated income statement respectively. Where losses attributable to the minorityshareholders of a subsidiary of the current period exceed the minority shareholders' interest entitled in the shareholders' equity ofthe subsidiary at the beginning of the period, the excess is allocated against the minority shareholders’ interest.
(1) Acquisition of subsidiaries or business
For acquisition of subsidiaries or business due to business combination involving entities under common control during thereporting period, the operating results and cash flows of such subsidiaries or business from the beginning to the end of thereporting period when the acquisition occurs shall be included in the consolidated financial statements. Adjustments shall be madeto the opening balance of the consolidated financial statements and the related items in the comparative statementssimultaneously as if the consolidated reporting entity has been in existence since the beginning of the control by the ultimatecontrolling party.
For acquisition of subsidiaries or business due to business combination involving entities not under common control during thereporting period, the identifiable assets, liabilities and contingent liabilities shall be included in the consolidated financialstatements based on the fair value determined on the date of the acquisition.
(2) Disposal of the subsidiaries
①General method
When losing control of the investee due to partial disposal of the equity investment, or any other reasons, the remainingequity investment is remeasured at fair value at the date in which control is lost. The sum of consideration received from disposal ofequity investment and the fair value of the remaining equity investment, net of the difference between the sum of the Company'sprevious share of the subsidiary's net assets recorded from the acquisition date or combination date and the sum of goodwill, isrecognized in investment income in the period in which control is lost. Other comprehensive income related to the equityinvestment of the original subsidiary that can be reclassified into future profit or loss, and other changes of owners’ equity
accounted for under equity method shall be recognized in investment income in the period in which control is lost.
②Disposal of the subsidiaries step by step
When disposal of equity interests of subsidiaries through multiple transaction until the control is lost, generally transactions instages are treatment as a package deal in accounting if the transaction terms, conditions, and economic impact of disposal of thesubsidiary's equity interests comply with one or more of the following:
i. These transactions are achieved at the same time or the mutual effects on each other are considered;
ii. A complete set of commercial results can be achieved with reference to the series of transactions as a whole;
iii. Achieving a transaction depends on at least achieving of one of the other transaction;
iv. One transaction recognized separately is not economical, but it is economical when considered together with othertransactions.
When losing control of a subsidiary in disposal of equity interests through multiple transactions is recognized as a packagedeals, these transactions shall be in accounting treated as loss control of a subsidiary in disposal of equity interests achieved.However, the differences between price on each disposal and disposal of investment on the subsidiary's net assets shall berecognized in other comprehensive income in the consolidated financial statements, and included in profit or loss for the periodwhen the control is lost.
If all transactions in disposal of equity interests of subsidiaries until losing control are not a package deals, accountingtreatment for partial disposal of equity investments of subsidiary without losing control shall be applied before control is lost. Whenthe control is lost, general accounting treatment for disposal of a subsidiary shall be used.
(3) Acquisition of minority interest of subsidiaries
The Company shall adjust the share premium in the capital reserve of the consolidated balance sheet with respect to anydifference between the long-term equity investment arising from the purchase of minority interest and the net assets attributing tothe parent company continuously calculated on the basis of the newly increased share proportion as of the acquisition date (or dateof combination) or, adjust the retained earnings if the share premium in the capital reserve is insufficient for write-down.
(4) Partial disposal of equity investment in subsidiaries without losing control
The difference between disposal consideration of long-term equity investment in subsidiaries partially disposed without losingcontrol and the share of net assets calculated from the date of acquisition or combination date shall be adjusted to share premiumin the capital reserve in the consolidated balance sheet. Adjustments shall be made to retained earnings in the event that the sharepremiums in the capital reserves are not sufficient for write-down.
7. Joint arrangement classification and accounting treatment
Joint arrangement can be divided into joint operation and joint venture.
Where the company, as a joint venture party of a joint arrangement, enjoys related assets of the arrangement and bearsrelated liabilities thereof, it is a joint operation.
The company confirms the following items related to the share of interests in joint operations, and conducts accountingtreatment in accordance with related enterprise accounting standards:
(1) Recognize the assets held separately by the Company and the assets jointly held in accordance with the share of theCompany;
(2) Recognize the liabilities assumed separately by the Company and the liabilities jointly assumed in accordance with theshare of the Company;
(3) Recognize the income generated through the sale of the Company’s share of the output of the joint operation;
(4) Recognize the income generated through the sale of the output of the joint operation in accordance with the share of the
Company.
(5) Recognize the expenses incurred separately, and the expenses incurred in joint operation in accordance with the share ofthe Company .
8. Recognition criteria of cash and cash equivalents
Cash refers to the cash on hand and deposits that are available for payment at any time of the Company. Cash equivalents referto investments held by the Company featuring short duration, strong liquidity, easy conversion into cash of known amount and lowrisk of changes in value.
9. Conversion of transactions and financial statements denominated in foreign currencies
(1) Foreign currency transactions
Foreign currency transactions shall be translated into RMB at the spot exchange rate on the day when the transactionsoccurred.
Balance sheet date foreign currency monetary items shall be translated using the spot exchange rate at the balance sheet date.The resulting exchange differences are recognized in profit or loss for the current period, except for those differences related to theprincipal and interest on a specific-purpose borrowing denominated in foreign currency for acquisitions, construction or productionof the qualified assets, which should be capitalized as cost of the assets.
(2). Translation of foreign currency financial statements
All assets and liabilities items in balance sheet are translated based on spot exchange rate on the balance sheet date; owners'equity items other than "undistributed profit" are translated at a spot exchange rate when accrued. The revenue and expense itemsin the income statement are converted using the weighted average exchange rate which is determined on the date of thetransaction by using systematic and reasonable method.
For disposal of overseas operation, the translation difference as stated in the foreign currency financial statements relating tooverseas operation, is accounted for in the profit and loss account in the current period from owners' equity items.
10. Financial instruments
The Company recognizes a financial asset, financial liability or equity instrument when it becomes a party to a financialinstrument contract.
(1) Classification of the financial instruments
According to the company's business model for managing financial assets and the contractual cash flow features of financialassets, financial assets at initial recognition are classified into: financial assets measured at amortized cost, financial assetsmeasured at fair value with changes recognized in other comprehensive income and financial assets measured at fair value withchanges recognized in profits and losses of the current period.
For financial assets that meet the following conditions and are not designated to be measured at fair value through the currentprofit or loss, the Company classifies them as financial assets at amortized cost:
- The business model is aimed at collecting contract cash flow;
- Contract cash flow is the payment of principal and interest based on the outstanding principal amount.
For financial assets that meet the following conditions and are not designated to be measured at fair value through currentprofit or loss, the Company classifies them as financial assets at fair value through other comprehensive income (debt instruments).
- The business model is aimed at both collecting contract cash flows and selling financial asset;
- Contract cash flow is the payment of principal and interest based on the outstanding principal amount.The Company will, at the time of initial recognition, irrevocably designate non-trading investments in equity instruments asfinancial assets measured at fair value and the change shall be included in other comprehensive income (equity instrument). Thedesignation is made on the basis of independent investment, and the related investments fit the definition of an equity instrumentfrom an issuer’s perspective.
In addition to the aforementioned financial assets at amortized cost and at fair value through other comprehensive income,the Company classifies all other financial assets as financial assets at fair value through current profit or loss.The financial liabilities, when initially recognized, are classified as: financial liabilities at fair value through profit or loss andfinancial liabilities at amortized cost.
(2) Recognition and measurement of financial instruments
1) Financial assets measured at amortized cost
Financial assets at amortized cost include notes receivable, accounts receivable, other receivables, long-term receivables andcreditors investment, which shall be initially measured at fair value, and the relevant transaction expenses should be initiallycapitalized; The accounts receivable that do not contain material financing compositions and those for which the Company decidesto not take into account the financing compositions of no more than one year shall be initially measured at the contract transactionprice.
The interest calculated by effective interest method during the holding period is recorded into the current profit and loss.
At the time of recovery or disposal, the difference between the price obtained and the book value shall be included in thecurrent profit or loss.
2) Financial assets (debt instruments) measured at fair value and whose changes included in other comprehensive income
Financial assets measured at fair value and its changes are included in other comprehensive income (debt instruments) includereceivables financing and investments in other creditor's rights. They are initially measured at fair value, and the relevanttransaction expenses should be initially capitalized. These financial assets are subsequently measured at fair value, and the changein fair value, other than the interest, the impairment loss or profit and the profit or loss on foreign exchange, shall be included inother comprehensive income.
Upon derecognition, the cumulative profits or losses previously included in other comprehensive income shall be removedfrom other comprehensive income and included in the profit or loss for the period.
3) Financial assets (equity instruments) measured at fair and whose changes included in other comprehensive income
Financial assets at fair value through other comprehensive income (equity instruments) include investment in other equityinstruments. They are initially measured at fair value, and the transaction expenses shall be initially capitalized. These financialassets are subsequently measured at fair value, and the change in fair value shall be included in other comprehensive income. Thedividends obtained shall be included in the profit or loss for the period.
Upon derecognition, the cumulative profits or losses previously included in other comprehensive income shall be removedfrom other comprehensive income and included in the carry-forward retained earnings.
4) Financial assets measured at fair value and whose changes included in profit and loss of the current period
Financial assets at fair value through profit or loss include trading financial assets, derivative financial assets and othernon-current financial assets. They are initially measured at fair value, and the transaction expenses related to them are included inthe profit or loss for the period. These financial assets are subsequently measured at fair value, and the change in fair value shall beincluded in the profit or loss for the period.
5) Financial liabilities measured at fair value and whose changes included in profit and loss of the current period
Financial liabilities at fair value through profit or loss include trading financial liabilities and derivative financial liabilities. Theyare initially measured at fair value, and the transaction expenses related to them are included in the profit or loss for the period.
These financial liabilities are subsequently measured at fair value, and the change in fair value shall be included in the profit or lossfor the period.Upon derecognition, the difference between their book value and the consideration paid is included in the profit or loss for theperiod.
6) Financial liabilities measured at amortized cost
Financial liabilities at amortized cost include short-term loans, notes payable, accounts payable, other payables, long-termloans, bonds payable, and long-term payables. They are initially measured at fair value, and the transaction expenses shall beinitially capitalized.The interest calculated by effective interest method during the holding period is recorded into the current profit and loss.Upon derecognition the difference between the consideration paid and the book value of these financial liabilities is includedin the current profit or loss.
(3) Derecognition and transfer of financial assets
The Company derecognizes financial assets when any one of the following conditions is satisfied:
The contractual right to receive cash flows of the financial assets has been terminated;
The financial asset has been transferred and virtually all the risks and rewards related to the ownership of the financial assetshave been transferred to the transferee;
The financial assets have been transferred, and while the Company has neither transferred nor retained virtually all of the risksand rewards related to the ownership of the financial assets, it has not retained control of the financial assets.
At the time of the transfer of financial assets, the recognition of the financial assets shall not be terminated if the Company hasretained virtually all the risks and rewards related to the ownership of the financial assets.
The substance-over-form principle shall be adopted while making judgment on whether the transfer of financial assets satisfiesthe above conditions for termination of recognition.
The transfer of financial assets can be classified into entire transfer and partial transfer. If the transfer of an entire financialasset satisfies the conditions for termination of recognition, the difference between the two amounts below shall be recorded intoprofit or loss for the period:
(1) The book value of the transferred financial assets;
(2) The consideration received as a result of the transfer, and the sum of cumulative amount of fair value changes thatoriginally included in owner equity (the financial assets involved in the transfer are the financial assets measured at fair value andwhose changes are included in Other Comprehensive Income(debt instruments)).
If the partial transfer of financial assets satisfies the conditions for termination of recognition, the overall book value of thetransferred financial asset shall be apportioned according to their respective relative fair value between the recognition terminatedpart and the remaining part, and the difference between the two amounts below shall be recorded into profit or loss for the currentperiod:
(1) The book value of recognition termination part
(2) The consideration for recognition termination part, and the sum of the cumulative amount of the recognition terminationin fair value changes that originally recorded in owner's equity (the financial assets involved in the transfer are measured at fairvalue and whose changes are included in Other Comprehensive Income (debt instruments)).
Financial assets will still be recognized if they fail to satisfy the conditions for termination of recognition, with the considerationreceived recognized as a financial liability.
(4) Recognition for termination of financial liabilities
When the current obligation under a financial liability is completely or partially discharged, the recognition of the whole orrelevant portion of the liability is terminated; an agreement is entered between the Company and a creditor to replace the original
financial liabilities with new financial liabilities with substantially different terms, terminate the recognition of the original financialliabilities as well as recognize the new financial liabilities.If all or part of the contract terms of the original financial liabilities are substantially amended, the recognition of the originalfinancial liabilities will be terminated in full or in part, and the financial liabilities whose terms have been amended shall berecognized as a new financial liability.When recognition of financial liabilities is terminated in full or in part, the difference between the book value of the financialliabilities terminated and the consideration paid (including transferred non-cash assets or new financial liability) is recognized inprofit or loss for the current period.Where the Company repurchases part of its financial liabilities, the book value of such financial liabilities will be allocatedaccording to the relative fair value between the continued recognized part and terminated part on the repurchase date. Thedifference between the book value of the financial liabilities terminated and the consideration paid (including transferred non-cashassets or new financial liability) is recognized in profit or loss for the current period.
(5) Method of determining the fair values of financial assets and liabilities
The fair value of a financial instrument that is traded in an active market is determined at the quoted price in the active market.The fair value of a financial instrument that is not traded in an active market is determined by using a valuation technique. TheCompany uses the valuation technique when it is applicable under current conditions and there are enough available data andother information to support and the technique should maximize the use of relevant observable. It chooses the inputs which areconsistent with the asset or liability's characteristics considered by market participants in the transaction of the relevant asset orliability and makes the maximum use of relevant observable inputs. Unobservable inputs are used under the circumstance that therelevant observable inputs cannot be obtained or not feasible.
(6) Test method and accounting treatment for impairment of financial assets
The company estimates the expected credit losses of financial assets measured at amortized cost, financialassets measured at fair value and whose changes included in other comprehensive income (debt instruments)and financial guarantee contracts on a single or combined basis.
The Company calculates the probability-weighted amount of the current value of the difference between the cash flowsreceivable under the Contract and the cash flows expected to receive, and recognizes the expected credit loss, by taking intoaccount all the reasonable and well-founded information, including past events, current condition and forward-looking economicsituation, and weighting the risk of default.
If the credit risk of this financial instrument has been significantly increased upon initial recognition, the Company measures itsloss provision in accordance with the amount equivalent to the expected credit loss of the financial instrument throughout theduration; if the credit risk of this financial instrument is not significantly increased upon initial recognition, the Company willmeasure the loss provision of this financial instrument by the amount of its expected credit loss in the 12 months to come. Theincreased or reversed amount of the loss provision resulting therefrom is included in the current profit or loss as the impairmentloss or profit.
The Company recognizes the relative changes in the risk of default within the expected duration of financial instruments, andassesses whether the credit risk of financial instruments has significantly increased since the initial recognition by comparing therisk of default of financial instruments on the balance sheet date with the risk of default on the initial recognition date. If thefinancial instrument becomes overdue for more than 30 days, the Company believes that the credit risk of this financial instrument
has been significantly increased, unless there are concrete evidences that the credit risk of this financial instrument has not beensignificantly increased upon initial recognition.
If the financial instrument carries low credit risk at the balance sheet date, the Company believes that the credit risk of thisfinancial instrument is not significantly increased upon initial recognition.If there are objective evidences showing that a certain financial asset has been subject to credit impairment, the Company willaccrue impairment provision for this financial asset on the individual asset basis. The Company will always measure the lossprovision for the accounts receivable and contract assets generated by transactions regulated by Accounting Standards forEnterprises No. 14 - Revenue (2017), whether they contain material financing compositions or not, by the amount of the expectedcredit loss throughout the duration.The Company will always measure the loss provision for the lease receivable by the amount of the expected credit lossthroughout the duration.The Company shall write down the book balance of a financial asset directly if it no longer reasonably expects that the contractcash flow of the financial asset can be recovered in whole or in part.Classify the accounts receivable, and the expected credit loss ratio for each portfolio is as follows:
Portfolio Name | Basis to Determine the Portfolio | Accrued method |
Portfolio one | Consolidation scope and accounts receivable from related parties | If there is objective evidence showing that it has been impaired, the impairment loss should be determined based on the difference between the present value of the future cash flow and its book value. Provision for bad debts shall be made. If no impairment is found after testing, no provision for bad debts shall be made. |
Portfolio two | The accounts receivable other than portfolio one: portfolio based on credit risk features by aging | Accrued based on the comparison table of the expected credit loss rate over the duration |
The bad debt provision method of portfolio two is adopted
Credit period | Expected credit loss ratio (%) |
Not overdue within the credit period | 3 |
Overdue to less than 1 year | 15 |
Overdue to 1-2 years | 25 |
Overdue to 2-3 years | 45 |
Overdue to 3-4 years | 60 |
Credit period | Expected credit loss ratio (%) |
Overdue to 4-5 years | 80 |
Overdue for more than 5 years | 100 |
11. Inventories
(1) Classification and cost of inventory
Inventory is classified into: inventory goods, turnover materials, etc.
(2) Determination of cost
The weighted average method is applied when the inventory is issued.
(3) Basis for the determination of net realizable value and different type of inventoriesNet realizable value of held-for-sale commodity stocks, such as finished goods, goods-in-stock, and held-for-sale raw materials,during the normal course of production and operation, shall be determined by their estimated sales less the related sellingexpenses and taxes; the net realizable value of material inventories, which need to be processed, during the normal course ofproduction and operation, shall be determined by the amount after deducting the estimated cost of completion, estimated sellingexpenses and relevant taxes from the estimated selling price of finished goods; the net realizable value of inventories held forexecution of sales contracts or labor contracts shall be calculated on the ground of the contracted price. If an enterprise holds moreinventories than the quantity stipulated in the sales contract, the net realizable value of the exceeding part shall be calculated onthe ground of general selling price.The inventory falling price reserves withdrawn shall be reversed within the amount withdrawn, and the reversed amount shallbe included in current profit or loss, if the net realizable value of an inventory is higher than its book value after the withdrawal dueto the disappearance of the factors that influence the writing-down of its value.
(4) Inventory system
The perpetual inventory system is adopted.
(5) Amortization of low-value consumables and packaging materials
One-time write-off method is used for low-value consumables.
12. Contract assets
Accounting policies as of January 1, 2020
(1) Recognition methods and standards of contract assets
The Company shall show the contract assets or contract liabilities in the balance sheet in accordance with the relationshipbetween the performance of the contract obligations and the Customer payment. The Company shall list its right to receiveconsideration due to the transfer of goods or services to the Customer (and such rights are subject to factors other than the passageof time) as contractual assets. Contract assets and contract liabilities under the same contract shall be shown on a net basis. TheCompany’s unconditional right (depending solely on the passage of time) to collect consideration from the Customer shall be shownseparately as a receivable.
(2) Determination method and accounting treatment for the expected credit loss of contract assets
For details of the method for determining the expected credit loss of contract assets and the accounting treatment, pleaserefer to Note V (10) 6. "Testing method and accounting treatment method of financial asset impairment".
13. Contract cost
Accounting policies as of January 1, 2020Contract costs include contract performance costs and contract acquisition costs.The Company recognizes the costs incurred for performing the contract and that not fall within the scope of inventories, fixedassets or intangible assets as stipulated by related standards as an asset when the following conditions are met:
· The cost is directly related to a current or anticipated contract.· The cost increases the Company’s future resources to perform obligations.· The cost is expected to be recovered.The Company regards the incremental cost incurred to acquire the contract and that are expected to be recovered as contractacquisition costs, and recognizes them as an asset.Assets related to contract costs shall be amortized using the same basis as income recognition of goods or services related tothe asset. However, the Company shall include the amount in current profit or loss if the amortization period of the contractacquisition cost is less than one year.
The Company shall draw an impairment provision for the excess part when the book value of an asset related to the contractcost is higher than the difference between the following two items, and recognize it as an impairment loss of the asset:
(1) The remaining consideration expected to be obtained due to the transfer of goods or services related to the asset;
(2) Estimated costs to be incurred for the transfer of goods or services related to the asset.
The Company shall reverse the impairment provision withdrawn and include it in current profit or loss if the impairmentfactors of the previous period change and cause the aforementioned difference higher than the book value of the asset. However,the book value of the asset after reverse shall not exceed the book value of the asset on the reverse date under the assumption thatno provision for the impairment is withdrawn.
14. Holding of the assets for sale
An asset whose book value is recovered mainly through the sale (including the exchange of non-monetary assets of acommercial nature) rather than through the continuous use of a non-current asset or disposal group is classified as holding-for-sale.
A non-current asset or disposed group is classified by the Company as holding for sale if it meets the following criteria at thesame time:
(1) Immediate sale could be made under the current circumstances in accordance with the convention of selling such kind ofassets or disposal groups in similar transactions;
(2) Selling is extremely likely to occur, i.e. the Company has made a resolution on a selling plan and obtained confirmedpurchase commitments, and the selling is predicted to be completed within 1 year. If required by relevant provisions that sellingshall only be made after approved by the relevant competent authority or supervision department of the Company, such approvalshould have been obtained.
For those classified as non-current assets holding for sale (excluding financial assets, deferred income tax assets) or disposalassets, if book value is higher than the net amount after deducing sales expenses from fair value, the book value should be revisedand written down to net amount after deducing sales expenses from fair value. The amount written down shall be recognized asassets impairment loss and included in current profit or loss. The impairment provision of assets holding for sale should be made.
15. Long-term equity investment
(1) Joint control or significant influence criterion
Joint control is the contractually agreed sharing of control of an arrangement, and exists only when requiring the unanimousconsent of the parties sharing control before making decisions about the relevant activities of the arrangement. The Companytogether with the other joint venture parties can jointly control over the investee and are entitled to the right of the net assets ofthe investee, as the investee is joint venture of the Company.
Significant influence refers to the right to participate in the financial and business decisions of the invested entity, but theinability to control or jointly control the formulation of policies. Where the Company can exercise significant influence over theinvestee, the investee is an associate of the Company.
(2) Determination of initial investment cost
1) Long-term equity investment formed by business combination
For long-term equity investment in a subsidiary generated due to business combinations involving entities under commoncontrol, the share of the book value in the consolidated financial statements of the ultimate controlling party on the date ofcombinations shall be taken as the initial investment cost of the long-term equity investments. For difference between the initialcost of long-term equity investment and the book value of the consideration paid, adjustments shall be made to the equitypremiums in the capital reserve. When the equity premiums in the capital reserve are not sufficient for write-down, the retainedearnings shall be adjusted.
For long-term equity investment in a subsidiary generated due to business combinations involving entities not under commoncontrol, the cost of the combination recognized on the date of combination shall be taken as the initial investment cost of thelong-term equity investments.
2) Long-term equity investment made by means other than business combination
The initial cost of a long-term equity investment obtained by cash payment shall be the purchase costs actually paid.
The initial cost of investment of a long-term equity investment obtained by means of issuance of equity securities shall be thefair value of the equity securities issued.
(3) Subsequent measurement and recognition of profit or loss
1) Long-term equity investment calculated by cost method
Long-term equity investment in subsidiaries of the company is calculated by cost method, unless the investment meets theconditions for holding for sale. except for the actual consideration paid for the acquisition of investment or the declared but not yetdistributed cash dividends or profits which are included in the consideration, investment gains are recognized as the Company'shares of the cash dividends or profits declared by the investee.
2) Long-term equity investment calculated by equity method
Long-term equity investments of associates and jointly controlled entities are calculated using equity method. Where the initialinvestment cost exceeds the investment, the difference between the share of the fair value of the investee’s identifiable net assetsshall be enjoyed and no adjustment shall be made to the initial investment cost of long-term equity investment; where the initialinvestment cost is less than the investment, the difference between the share of the fair value of the investee’s identifiable netassets shall be enjoyed and be included in current profit or loss, and adjustments shall be made to the initial investment cost oflong-term equity investment.
The Company recognizes the investment income and other comprehensive income according to the shares of net profit or lossand other comprehensive income realized by the investee which it shall be entitled or shared respectively, and simultaneouslymakes adjustment to the book value of long-term equity investments; The book value of long-term equity investment shall bereduced by attributable share of the profit or cash dividends for distribution declared by the investee. In relation to other changesof owner's equity except for net profits and losses, other comprehensive income and profit distributions of the investee, the bookvalue of long-term equity investments shall be adjusted and included in owner’s equity.
When recognizing the amount of proportion of net profit or loss, other comprehensive income and other changes of owner’s
equity, in the investee which it entitles, fair value of the identifiable assets of the investee at the time when the investment isobtained shall be used as basis, and adjustment shall be made to the net profit, other comprehensive income and others of theinvestee in accordance with the accounting policies and accounting period of the Company.The Company shall be liable for net loss incurred by the Company to the joint venture or associate, and shall write it down tozero with the book value of the long-term equity investment and other long-term equity which substantially constitute netinvestment in the joint venture or associate. Where a joint venture or associate later realizes net profits, the Company shall resumerecognition of its share of income after the share of income has made up for the unrecognized share of loss.
16. Investment property
Measurement Mode of Investment PropertyMeasured by cost methodDepreciation or amortization methodsInvestment property refers to the real estate held to generate rental income or capital appreciation, or both, including leasedland use rights, land use rights held for transfer after appreciation, and leased buildings (including buildings that are leased aftercompletion of self-construction or development activities and buildings in construction or development that are used for rental inthe future).Subsequent expenditures related to fixed assets shall be included in the cost of fixed assets when the relevant economicbenefits are likely to flow in and the cost can be measured reliably. The book value of the replaced part is derecognized. Othersubsequent expenditures shall be included in current profit or loss at the time of occurrence.The Company adopts the cost mode to measure the existing investment property. Investment property measured at cost -buildings held for leasing shall adopt the same depreciation policy for fixed assets of the company, land use rights held for leasingshall adopt the same amortization policy for the intangible assets.
17. Fixed assets
(1) Conditions for recognition of fixed assets
Fixed assets are tangible assets that are held for use in the production or supply of goods or services, for rental to others, or foradministrative purposes; and have a service life of more than one accounting year. Fixed assets shall be recognized when thefollowing conditions are met at the same time:
1) The economic benefits related to the fixed asset are likely to flow into the company;
2) The cost of the fixed asset can be reliably measured.
Fixed assets are initially measured at cost (with the influence of expected disposal costs taken into consideration).
Subsequent expenditures related to fixed assets shall be included in the cost of fixed assets when the relevant economicbenefits are likely to flow in and the cost can be measured reliably. The book value of the replaced part is derecognized. Othersubsequent expenditures shall be included in current profit or loss at the time of occurrence.
(2) Methods for depreciation
Fixed assets are depreciated by categories using the straight-line method, and the annual depreciation rates are determined bycategories based upon their estimated useful lives and their estimated residual values. For fixed assets with provision forimpairment, the amount of depreciation shall be determined in future periods according to the book value after deducting the
provision for impairment and based on the usable life. Where the parts of a fixed asset have different useful lives or cause economicbenefits for the enterprise in different ways, different depreciation rates or depreciation methods shall apply, and each part isdepreciated separately.
Category | Depreciation method | Useful lives of depreciation | Residual Ratio | Annual depreciation rate |
Housing and building | Straight-line method | 5-35 | 2.8-5 | 19.44-2.71 |
General Equipment | Straight-line method | 3-10 | 2.8-10 | 32.40-9 |
Special Equipment | Straight-line method | 5-10 | 2.8-5 | 19.44-9.5 |
Machinery and equipment | Straight-line method | 3-10 | 2.8-5 | 32.40-9.5 |
Transportation Equipment | Straight-line method | 5-10 | 2.8-10 | 19.44-9 |
Others | Straight-line method | 5-10 | 2.8-5 | 19.44-9.5 |
(3) Disposal of fixed assets
Fixed assets being disposed of or not expected to generate economic benefits through use or disposal shall be derecognized.The amount of income from the disposal, transfer, scrapping or damage of fixed assets after deducting its book value and relatedtaxes shall be included in the current profit and loss.
18. Construction in progress
Construction in progress is measured at the actual costs incurred. The actual cost includes construction costs, installation costs,
borrowing costs that meet the capitalization conditions, and other necessary expenditures incurred before the construction inprogress reaches its intended use status. When the construction in progress reaches its intended use status, it shall be transferredto fixed assets according to budget, cost or actual contract cost of the construction project, and the depreciation of the fixed assetsshall be accrued according to fixed assets depreciation policy of the company. When the final account of completed project is issued,the estimated cost shall be adjusted according to the actual cost.
19. Borrowing costs
(1) Criteria for recognition of capitalized borrowing costs
For borrowing costs incurred by the Company that are directly attributable to the acquisition, construction or production ofassets qualified for capitalization, the costs will be capitalized and included in the costs of the related assets. Other borrowing costsshall be recognized as expense in the period in which they are incurred and included in profit or loss for the current period.Assets qualified for capitalization are assets (fixed assets, investment property, inventories, etc.) that necessarily take a substantialperiod of time for acquisition, construction or production to get ready for their intended use or sale.
(2) Capitalization period of borrowing costs
The capitalization period shall refer to the period between the commencement and the cessation of capitalization of borrowingcosts, excluding the period in which capitalization of borrowing costs is temporarily suspended.
Capitalization of borrowing costs begins when the following three conditions are fully satisfied:
1) Asset expenditures have been incurred, which include the expenditures in the form of cash payment, transfer of non-cashassets, or assumption of interest-bearing debts for construction or production of assets eligible for capitalization;
2) Borrowing costs have been incurred;
3) The purchase and construction or production activities which are necessary to prepare the asset for its intended use or salehave started.
Capitalization of borrowing costs shall be suspended during periods in which the qualifying asset under acquisition andconstruction or production ready for the intended use or sale.
(3) Suspension of capitalization period
Capitalization of borrowing costs shall be suspended during periods in which the acquisition, construction or production of aqualifying asset is interrupted abnormally, when the interruption is for a continuous period of more than 3 months; if theinterruption is a necessary step for making the qualifying asset under acquisition and construction or production ready for theintended use or sale, the capitalization of the borrowing costs shall continue. The borrowing costs incurred during such period shallbe recognized as profits and losses of the current period. When the acquisition and construction or production of the asset resumes,the capitalization of borrowing costs commences.
(4) Calculation of capitalization rate and amount of borrowing costs
Specific borrowings for the acquisition, construction or production of assets qualified for capitalization, borrowing costs of thespecific borrowings actually incurred in the current period minus the interest income earned on the unused borrowing loans as adeposit in the bank or as investment income earned from temporary investment will be used to determine the amount ofborrowing costs for capitalization.General borrowings for the acquisition, construction or production of assets qualified for capitalization, the to-be-capitalizedamount of interests on the general borrowing shall be calculated and determined by multiplying the weighted average assetdisbursement of the part of the accumulative asset disbursements minus the specifically borrowed loans by the capitalization rateof the general borrowing used. The capitalization rate is calculated and determined based on the weighted average actual interestrate of general borrowing.During the period of capitalization, the exchange balance on the principals and interests of special foreign currency borrowings shallbe capitalized and shall be included in the cost of assets eligible for capitalization. The exchange balance on the principals andinterests of foreign currency borrowings other than the special foreign currency borrowings shall be included in current profit orloss.
20. Intangible assets
(1) Valuation method, service life, impairment test
1) Method for valuation of intangible assets
1) It shall be initially measured at cost when the company obtains intangible assets;
The costs of externally purchased intangible asset include the purchase price, relevant taxes and expenses paid, and otherexpenditures directly attributed to its intended use.
2) Subsequent measurement
The service life of intangible assets shall be analyzed and judged upon acquisition.
Intangible assets with a limited service life are amortized within the term of economic benefits for the enterprise. If it isimpossible to foresee the term, it shall be regarded as an intangible asset with uncertain service life and shall not be amortized.
2) Estimated service life of intangible assets with limited service life
Item | Estimated useful lives | Basis |
Land use rights | 30-50 years | The number of years is indicated on the land certificate |
Computer Software | 3-10 years | Benefit period |
Vehicle license plate | 10 years | Estimated service life |
At the end of each year, the service life and amortization method of the intangible assets with a limited service life arereviewed.
3) Judgment basis for intangible assets with uncertain service life and procedures for reviewing their service lifeAccording to relevant regulations of Australia, there is no stipulated term of use for the land use right after purchase, and it canbe used permanently. Therefore, the company recognizes the land without a specified use term as an intangible asset withuncertain service life, for which no amortization is allowed.At the end of each year, the service life of intangible assets with uncertain service life will be reviewed.
(2) Accounting policy for internal R&D expenditure
The expenses for internal research and development projects of the Company are divided into expenses in the research phaseand expenses in the development phase.Research phase: Scheduled innovative investigations and research activities to obtain and understand scientific ortechnological knowledge.Development phase: Apply the research outcomes or other knowledge to a plan or design prior to a commercial production oruse in order to produce new or essentially-improved materials, devices, products, etc.
Specific condition for capitalizing expenditure during the development phase
Expenses in the research phase are recorded into the profits and losses for the current period when they occur. Expenditureduring the development phase that simultaneously satisfies the following conditions shall be recognized as intangible assets.Otherwise shall be included in current profit or loss:
1) It is technically feasible to complete the intangible asset so that it can be used or sold;
2) There is intention to complete the intangible asset for use or sale;
3) The means by which intangible asset generates economic benefits, including the ability to prove that there is a market forthe products produced with the intangible asset or the existence of a market for the intangible asset itself. Where the intangibleasset is to be used internally, its usefulness can be proved;
4) The company has sufficient technical, financial and other resources to support the development of such intangible assets,and has the ability to use or sell such intangible assets;
5) The expenditure attributed to the development stage of the intangible asset can be reliably measured.
The R&D expenditures incurred shall be included in current profit or loss if it is impossible to distinguish expenditure during theresearch phase and expenditure during the development phase.
21. Long-term asset impairment
Long-term assets, such as long-term equity investment, investment properties, fixed assets and construction in progress thatmeasured at cost, and intangible assets and oil and gas assets with limited service life, are tested for impairment if there is anyindication that an asset may be impaired on the balance sheet date. If the result of the impairment test indicates that therecoverable amount of the asset is less than its book value, a provision for impairment and an impairment loss are recognized forthe amount by which the asset's book value exceeds its recoverable amount. The recoverable amount is the higher of an asset's fairvalue less costs to sell and the present value of the future cash flows expected to be derived from the asset. Provision for assetimpairment is determined and recognized on the individual asset basis. If it is not possible to estimate the recoverable amount of anindividual asset, the recoverable amount of a group of assets to which the asset belongs to is determined. A group of assets is thesmallest group of assets that is able to generate cash inflows independently.
Goodwill formed due to business combination, intangible assets with uncertain service life and intangible assets that have notyet reached serviceable conditions, shall be tested for impairment at least at the end of each year, regardless of whether there isany indication of impairment.
When the Company carry out impairment test to goodwill, the Company shall, as of the purchasing day, allocate on areasonable basis the book value of the goodwill formed by merger of enterprises to the relevant asset groups, or if there is a
difficulty in allocation, to allocate it to the sets of asset groups. The relevant asset group or combination of asset groups is the assetgroup or combination of asset groups that can benefit from the synergies of business combination.For the purpose of impairment test on the relevant asset groups or the sets of asset groups containing goodwill, if anyevidence shows that the impairment of asset groups or sets of asset groups related to goodwill is possible, an impairment test willbe made first on the asset groups or sets of asset groups not containing goodwill, thus calculating the recoverable amount andcomparing it with the relevant book value so as to recognize the corresponding impairment loss. Asset group or combination ofgroup assets containing goodwill are tested for impairment and the book value and recoverable amount shall be compared. If therecoverable amount is less than the book value, the amount of impairment loss shall be deducted and apportioned to the bookvalue of goodwill in asset group or combination of asset groups, before deducting to the book value of all other assetsproportionally based on the proportion of the book value of all assets other than goodwill in the asset group or combination ofasset groups.Once the above asset impairment loss is recognized, it will not be reversed in the subsequent accounting periods.
22. Long-term prepaid expenses
Long-term prepaid expenses are expenses which have occurred but will benefit over 1 year and shall be amortized over thecurrent period and subsequent periods. The long-term prepaid expenses of the company include scenic animals and plants, scenicroad signs, creation of costumes and props, expenditures for improvement of leased fixed assets, house decoration fees andlong-term rental fees.
1. Amortization method
Long-term prepaid expenses are amortized evenly over the estimated benefit period
2. Amortization period
Item | Estimated useful lives | Basis |
Scenic animals and plants | 5 years | Benefit period |
Scenic road signs | 5 years | Benefit period |
Creation Costume Prop | 5 years | Benefit period |
Expenditures for improvement of leased fixed assets | 3-10 years | Benefit period |
House decoration fee | 5-10 years | Benefit period |
Long-term rental fee | 3-40 years | Benefit period |
23. Contract liabilities
Accounting policies as of January 1, 2020
The Company shall show the contract assets or contract liabilities in the balance sheet in accordance with the relationshipbetween the performance of the contract obligations and the Customer payment. The Company’s obligation to transfer goods orprovide services to customers for which consideration has been received or receivable are presented as contractual liabilities.Contract assets and contract liabilities under the same contract shall be shown on a net basis.
24. Employee remuneration
(1) Accountant arrangement method of short-term remuneration
During the accounting period when the staff provides service, the Company will recognize the short-term remunerationactually incurred as liabilities, and the liabilities would be charged into current profits and loss or costs of assets.
The Company will pay social insurance and housing funds, and will make provision of trade union funds and staff educationcosts in accordance with the requirements. During the accounting period when the staff provides service, the Company willdetermine the relevant amount of employee benefits in accordance with the required provision basis and provision ratios.
The expenses on employee benefit incurred by the Company shall be included in the current profit or loss or related asset costbased on the actual amount when actually incurred, and the non-monetary benefit shall be measured at its fair value.
(2) Accountant arrangement method of retirement benefit plan
1) Defined contribution plan (DCP)
The Company will pay basic pension insurance and unemployment insurance in accordance with the relevant provisions of thelocal government for the staff. During the accounting period when the staff provides service, the Company will calculate the amountpayable in accordance with the local stipulated basis and proportions which will be recognized as liabilities, and the liabilities wouldbe charged into current profits and loss or costs of assets. In addition, the Company joins in corporation annuityplan/supplementary pension insurance fund approved by related state departments. The Company conducts payment to annuityplan/ local social insurance institution according to certain proportion of employees’ wages and corresponding expenditures areincluded in the current profit or loss or relevant asset costs.
2) Defined benefit plan
The welfare responsibilities generated from defined benefit scheme based on the formula determined by projected unit creditmethod would be vested to the service period of the staff and charged into current profits and loss or costs of assets.
The deficit or surplus resulting from the present value of the defined benefit plan obligations minus the fair value of thedefined benefit plan assets is recognized as the net liability or net asset of the defined benefit plan. If there is a surplus in thedefined benefit plan, the company shall use the lower of the defined benefit plan surplus and the asset ceiling to measure the netassets of the defined benefit plan.
All defined benefit plan obligations, including obligations expected to be paid within twelve months after the end of the annualreporting period in which employees provide services, are based on market yield of treasury bond or high-quality corporate bond inan active market that matches the date of the balance sheet, the period of defined benefit plan obligation and currency applied.
The service cost, net interest on net liabilities and net assets of the defined benefit plan are recorded in the current profit andloss or related asset cost. The changes resulting from the re-measurement of net liabilities or net assets of the defined benefit planare recorded in other comprehensive income and shall not be rolled back to profit and loss in subsequent accounting periods. Whenthe original defined benefit plan is terminated, all the part originally recorded in other comprehensive income should be carriedforward to undistributed profit.
In the settlement of the defined benefit plan, the settlement gain or loss shall be recognized according to the differencebetween the present value of the defined benefit plan obligation and the settlement price determined on the settlement date.
(3) Accountant arrangement method of termination benefits
Where the Company pays termination benefit to employees, the liabilities of employee remuneration generated bytermination benefit shall be recognized at the earlier of the following date and included in the current profit or loss: when thecompany cannot unilaterally withdraw termination benefit provided by labor relationship termination plan or layoff proposal; when
the Company recognizes costs or expenses related to a restructuring of the payment of termination benefits.
25. Estimated liabilities
The Company shall recognize the obligations related to contingencies as estimated liabilities provided that they satisfy thefollowing conditions:
1) The obligation is the current obligation of the company;
2) The fulfillment of this obligation is likely to result in the outflow of economic benefits from the Company;
3) The amount of the obligation can be reliably measured.
Estimated liabilities shall be initially measured at the best estimate of the expenditure required to settle the related presentobligation.
Factors pertaining to a contingency such as risk, uncertainties, and time value of money shall be taken into account as a wholein reaching the best estimate. Where the effect of the time value of money is material, the best estimate shall be determined bydiscounting the related future cash outflow.
Where some or all of the expenditure required to settle an estimated liability is expected to be reimbursed by a third party, thereimbursement is separately recognized as an asset when it is virtually certain that the reimbursement will be received. The amountrecognized for the reimbursement is limited to the book value of the estimated liability.
On the balance sheet date, the Company shall review the book value of the estimated liabilities, and shall adjust the bookvalue on the basis of the current best estimate if there is conclusive evidence showing the book value cannot reflect the currentbest estimate.
26. Share-based payment
The Company's share-based payment refers to a transaction in which an enterprise determines the liabilities on the basis ofequity instruments granting or bearing for the acquisition of service from its employees or other parties. The company's sharebased payment is divided into the share payment settled in equity and the share based payment settled in cash.
(1) The share payment settled in equity and equity instruments
As to an equity-settled share-based payment in return for services of employees, calculation will be based on the fair value ofthe equity instrument granted to the employees. Equity instruments vested immediately after the date of grant will be included inthe relevant cost or expense based on its fair value on the date of grant, and the capital reserve will be increased accordingly. Forequity instruments to be vested after completing the service during the waiting period after the date of grant or meeting regulatedperformance conditions, the Company shall include the services obtained in the current period in relevant costs or expenses andincrease capital reserves accordingly on each balance sheet date during the waiting period on the basis of the best estimate of thenumber of viable equity instruments to be vested and the fair value on the grant date.
If the equity instrument is cancelled during the waiting period after the date of grant, the Company will treat the cancellationof the equity instrument as accelerated vest, include the amount to be recognized in the remaining waiting period in the currentprofit or loss, and recognize the capital reserves simultaneously. However, if new equity instruments are vested and they areverified at the vesting date of new equity instrument as alternatives vested to canceled equity instruments, the treatment on thenew equity instrument is in conformity with the modified treatment on disposal of equity instrument.
27. Revenue
Accounting policies for revenue recognition and measurement
Accounting policies as of January 1, 2020
(1) Accounting policies for revenue recognition and measurement
The Company has fulfilled its contractual obligation to recognize income when the Customer obtains control over the relevantgoods or services. Obtaining control over related goods or services means to be able to dominate the use of the goods or servicesand obtain virtually all economic benefits from it.Where the Contract contains the performance of two or more obligations, the Company shall, on the commencement date ofthe Contract, apportion the transaction price to each individual performance obligation on the basis of the relative proportion ofthe individual selling price of the goods or service committed by each individual performance obligation. The Company shallmeasure its income on the basis of the transaction price apportioned to each individual performance obligation.The transaction price refers to the amount of consideration the Company is expected to be entitled to receive for the transferof goods or services to the Customer, excluding payments received on behalf of third parties and the amounts expected to berefunded to the Customer. The Company determines the transaction price in accordance with Contract terms and by taking intoconsideration its past practices. In determining the transaction price, it takes into consideration the impact of variable consideration,material financing elements in the Contract, non-cash consideration, consideration payable to customers and other factors. TheCompany determines the transaction price that includes the variable consideration at an amount not exceeding the amount ofaccumulated recognized income which is not likely to be materially reversed when the relevant uncertainty is eliminated. Wherethere are material financing components in the Contract, the Company shall determine the transaction price on the basis of theamount payable based on the assumption that the Customer pays in cash upon obtaining control over the goods or services, andshall amortize the difference between the transaction price and the Contract consideration by effective interest method during theContract period.It shall be deemed as fulfilling performance obligation within a certain period of time if one of the following conditions issatisfied. Otherwise, it shall be deemed as fulfilling performance obligation at a certain point in time:
· The Customer obtains and consumes the economic benefits arising from the Company’s performance of obligations at thesame time of that the Company perform its obligations.
· The Customer can control the goods under construction during the process that the Company perform its obligations.
· The product produced by the Company during the performance of its obligations is irreplaceable in use, and the Companyshall be entitled to receive payment for the accumulated part of the performance completed so far during the whole Contractperiod.
For obligations performed within a certain period of time, the Company shall recognize income on the basis of theperformance progress during that period, except when the performance progress cannot be reasonably determined. The Companywill adopt output method or input method to determine the performance progress by taking the nature of the goods or servicesinto consideration. Where the performance progress cannot be reasonably determined and the costs incurred are expected to becompensated, the Company shall recognize income on the basis of the costs incurred until the performance progress can bereasonably determined.
For obligations performed at a certain point of time, the Company recognizes income at the point when the Customer obtaincontrol over relevant goods or services. The Company takes the following indications into consideration when determining whetherthe Customer has obtained control over relevant goods or services:
· The Company is entitled to collect payment in respect of the goods or services immediately, i.e. the Customer is obliged tomake payment in respect of the goods or services immediately.
· The Company has transferred legal ownership of the goods to the Customer, i.e. the Customer has legal ownership of thegoods.
· The Company has physically transferred the goods to the Customer, i.e. the Customer has physically possessed the goods.
· The Company has transferred the principal risks and rewards in the ownership of the goods to the Customer, i.e. theCustomer has obtained the principal risks and rewards in the ownership of the goods.
· The Customer has received the goods or services, etc.
(2) The specific accounting policies related to the company's main activities that generate revenue are
described as follows:
1) The principle for confirmation of ticket sales revenue
The tourists, after buying the ticket and checking in through the gate, shall have the right to visit the scenic spot and watch thelive performance. When the ticket amount has been collected or the right to receive payment has been obtained, the revenueshould be generated.
2) The principle for confirmation of e-commerce sales revenue
The economic benefits from the tickets, based on the ratio of profits sharing agreed by and between the company and each ofscenic spots, hotels or travel agencies, are expected to have flowed into the parties concerned upon the orders are generated andthe tourists have entered the park or checked in. When the ticket amount has been collected or the right to receive payment hasbeen obtained, the revenue should be generated.
3) The principle for confirmation of the revenue from design and planning fee
Design and planning are to provide a package of services for other scenic spots and performance projects, including scenic spotdesign and planning, theater design and planning, performance directing, plan for opening, marketing, follow-up qualityimprovement and other designs and services agreed in the agreement. The revenue shall be recognized, when the companycompletes the phased design, planning and upgrading according to the requirements of the project progress, and submits thephased results to the client and obtains its confirmation indicating that the company has completed the service of the stage.
Follow-up business management: After the relevant services have been provided, the service revenue shall be collectedaccording to the results as agreed in the contract. The income shall be recognized in the current period of service provided.
4) The principle for confirmation of the revenue from supporting services of scenic spots
The revenue shall be recognized when relevant services for the scenic spot have been provided and cash has been received orthe right to receive payment has been obtained.
Accounting policy prior to January 01, 2020
(1) General principle for confirmation of the revenue from sales of goods
1) The Company has transferred the major risks and rewards of ownership of the goods to the buyers;
2) The company does not retain the continuing management rights normally associated with the ownership, nor does iteffectively control over the sold goods;
3) The amount of revenue can be reliably measured;
4) Relevant economic benefits are likely to flow into the company;
5) The costs related, incurred or to be incurred can be reliably measured.
(2) Specific principle
1) The principle for confirmation of ticket sales revenue
After tickets sold and tourists entered the park, the major risks and rewards are transferred as tourists entered the parkthrough the gate. The amount of ticket revenue can be reliably measured, and the payment can be received in time. The revenueshall be recognized when relevant cost, incurred or to be incurred, can be reliably measured.
2) The principle for confirmation of e-commerce sales revenue
In accordance with the ratio of profits sharing agreed by and between the company and each of scenic spots, hotels or travelagencies, the major risks and rewards of revenue are transferred after the order has been generated, the payment has been made,and the tourists have entered the park. The revenue shall be recognized when relevant cost is reliably measured.
3) The revenue from 6.cn Internet performance platform
The company obtains revenue from the business of the 6.cn Internet performance platform. The company shall recognizerevenue, after the virtual coins of the internet performance platform obtained by registered users online or through third-partyrecharge channels. The revenue shall be recognized when the virtual coins consumed on the Internet performance platform. Theamount of virtual coins not recognized as revenue and the ending balance in the account of internet performance platform shall berecognized as advance receipts.
4) The principle for confirmation of on-line game revenue
4.1 Under the independent operation mode, the company independently conducts game development and operation. Sincethe company does not distinguish the types of consumption items (consumable items and permanent items) of the game, thecompany, in the principle of prudence and based on consumption, recognizes the revenue based on the life cycle deferral of players.The amount of virtual coins unconsumed and remained in the account at the end of the period is confirmed as advance payment.The amount of revenue that has not yet been included in player life cycle amortization is recognized as deferred revenue.
4.2 Under the self-development mode, the company entrusts other companies to operate, without assuming the mainresponsibility for operation. The operating revenue is recognized in accordance with the net method, namely the share paymentpaid by the cooperative operator.
4.3 Under the authorized operation mode, the company shall not take the main responsibility for operation in accordancewith the agreement. The revenue is recognized in accordance with the net method, namely the share payment paid by thecooperative operator. Among them, the exclusive agency and the company recognizes the revenue based on the life cycle deferral ofplayers. The amount not included in revenue shall be recognized as deferred income.
4.4 Principles for confirmation of game copyright revenue: Under the authorized business model, the company shallundertake the obligations of technical support, game upgrades and others. The company recognizes revenues based on thestraight-line method during the revenue period agreed herein. For payments that have been received and have not yet beenauthorized to operate, it shall be recognized as deposit received. The amount that has not been amortized and included in theincome shall be recognized as deferred income.
4.5 Revenue from technical service fee: When the company completes the technical services, the revenue shall be recognizedbased on the amount confirmed by both parties.
5) Principle for confirmation of the revenue from design and planning fee
After the program has been filmed and shown on TV, on-line cinema, theater and network, the revenue shall be recognizedbased on the actual amount confirmed by both parties and the amount calculated by the corresponding accounting method.
6) Principle for confirmation of the revenue from design planning fee
Design and planning are to provide package design and planning services for other scenic spots and performance projects,including scenic spot design and planning, theater design and planning, performance creation and costume props design, openingplanning, market promotion planning and follow-up quality improvement services, etc. which are agreed in the agreement. As apackage of services has the following characteristics:
1) The labor service at each stage has an independent implementation plan and process; 2) The results of each stage areagreed and confirmed by the client; 3) The revenue and cost of the labor service at each stage can be individually identified.Therefore, the revenue from package design and planning services is recognized in stages. It indicates that the company hascompleted the stage, when the company completes the staged design, planning and improvement based on the project progressrequirements. At the same time, the company shall submit the staged results to the client and obtain confirmation from the client.The revenue shall be recognized when the content and amount of the labor services can be reliably measured, relevant economicbenefits can flow into the company, and relevant costs can be reliably measured.
7) Principle for confirmation of the revenue from supporting transportation services in scenic spots
Coupon ticket of scenic spot and transportation services: The company and the scenic spot recognize revenue based on thesharing ratio agreed by both parties provided that the main risks and rewards of the revenue is transferred, the order has beengenerated, the price has been paid, and the tourists have entered the park. The revenue shall be recognized when relevant cost isreliably measured.Tourists purchase separately after entering the scenic spot: The main risks and rewards of revenue is transferred, after theorder has been generated, the price has been paid, and the tourists have entered the park. The revenue shall be recognized whenrelevant costs can be reliably measured.
(3) Principle for confirmation and measurement of the revenue from the transfer of asset use rights
When the economic benefits related to the transaction are likely to flow into the enterprise and the amount of revenue canbe measured reliably, the amount of revenue from transferring the right to use assets shall be determined in the followingsituations:
1) The amount of interest income shall be calculated and determined according to the term of the company’s monetary fundsused by others and the actual interest rate.
2) The amount of usage fee revenue shall be calculated and determined according to the charging time and method agreed inrelevant contract or agreement.
28. Government grants
(1) Type
Government grants refer to the monetary or non-monetary assets obtained free of charge by the company from thegovernment. They are divided into government grants related to assets and government grants related to revenue.
Government grants related to assets refer to government grants acquired by the Company for the purpose of purchasing orconstructing or otherwise forming long-term assets. Government grants related to revenue refer to the government grants otherthan those related to assets.
(2) Confirmation of time point
The specific standards for government grants related to assets are: The construction of the assets granted to enterprises.
Time for confirming the government grants related to assets: the relevant assets reach the intended use state
(3) Accounting treatment
Accounting treatment of the government grants related to assets: They shall be recognized as deferred income when obtained.After the relevant assets reach the intended use state, they shall be recognized as current profits and losses in installmentsaccording to the method of average amortization of asset service life. For those assets related to daily activities of the company,they shall be included in other income. For those assets that are not related, they shall be included in non-operating income;
The specific standards for government grants related to revenue are: The expenses or losses of the compensated enterprise
Where the government documents fail to specify the recipient of grants, the company shall classify the government grants asassets related or income related in accordance with the basis below: The government grants as a whole shall be classified asgovernment grants related to revenue.
The time of the confirmation of government grants related to revenue: Related expenses or losses occur.
Accounting treatment of government grants related to revenue: Those used to compensate relevant costs or losses of thecompany in subsequent periods, shall be recognized as deferred income when obtained. They shall be included in the current profitand loss when related costs or losses are confirmed. For those assets related to daily activities of the company, they shall beincluded in other income. For those assets that are not related, they shall be included in non-operating income; For those assetsused to compensate related costs or losses incurred of the company, they shall be directly included in the current profit and losswhen obtained. For those assets related to daily activities of the company, they shall be included in other income. For those assetsnot related, they shall be included in non-operating income.
29. Deferred income tax assets/liabilities
Income tax includes current income tax and deferred income tax. The Company will include current income tax and deferredincome tax in the current profit or loss, except for income tax arising from business combination and transaction or event directlyincluded in the owners’ equity (including other comprehensive income).
Deferred income tax assets and deferred income tax liabilities shall be calculated and recognized on the basis of the difference(temporary difference) between the tax basis of the assets and liabilities and their book value.
Deferred income tax assets are recognized to the extent that it is probable that future taxable profits will be available against
which deductible temporary differences can be utilized. For deductible losses and tax credits that can be reversed in the futureperiod, deferred tax assets shall be recognized to the extent that it is probable that taxable profit will be available in the future tooffset the deductible losses and tax credits.Save as the exceptions, deferred income tax liabilities shall be recognized for the taxable temporary difference.Special circumstances in which deferred income tax assets or deferred income tax liabilities are not recognized include:
Initial recognition of goodwill;Transaction or event that is not a business combination and would not affect accounting profit and taxable income (ordeductible loss) at the time of occurrence.For taxable temporary differences related to investments in subsidiaries, associates and joint ventures, deferred income taxliability is recognized, unless the Company can control the timing of reversal of such temporary differences and such temporarydifferences are not likely to be reversed in the foreseeable future. For deductible temporary differences related to the investmentsof subsidiaries, associates and joint ventures, deferred tax asset is recognized when the temporary differences are likely to bereversed in the foreseeable future and the taxable income amount used to offset the deductible temporary differences is likely tobe obtained in the future.On the balance sheet date, deferred income tax assets and deferred income tax liabilities shall be, as stipulated by tax law,measured by the applicable tax rate of the period of expected recovery of the relevant assets or settlement of the relevantliabilities.
On the balance sheet date, the Company reviews the book value of the deferred income tax assets. The book value of thedeferred income tax asset will be written down if sufficient taxable income is not likely to be obtained to offset the benefit of thedeferred income tax asset in the future period. The write-down amount will be reversed when sufficient taxable income is likely tobe obtained.After granted the legal rights of net settlement and with the intention to use net settlement or obtain assets and repay debt atthe same time, the net amount after offsetting its current income tax assets and current income tax liabilities shall be recorded.On the balance sheet date, the deferred income tax assets and deferred income tax liabilities are presented in net amountafter set-off when both of the following conditions are satisfied:
The taxpayer has the legal right to settle the current income tax assets and current income tax liabilities on a net basis;
Deferred income tax assets and deferred tax liabilities are related to the income tax to be paid by the same entity liable to paytax to the same tax collection and management authority or related to different entities liable to pay tax. The relevant entity liableto pay tax is intended to apply net settlement of current income tax assets and liabilities or, at the same time, obtain assets andrepay debt in every future period that deferred income tax assets and liabilities with importance would be reversed.
30. Lease
(1) Accounting of operating lease
1) The lease fee paid by the company for operating lease of assets shall be included in current expenses by amortizing on astraight-line basis during the entire lease period without deducting the rent-free period. Initial direct costs that are attributable toan operating lease incurred by the Company are charged to current profit and loss.
When the lesser bears the lease related expenses which should be undertaken by the Company, the Company shall deduct thispart of expense from the rent and amortize the net amount over the lease term.
2) The lease fee charged by the company for leasing its assets shall be recognized as leasing income by amortizing on astraight-line basis during the entire lease period without deducting the lease-free period. The initial direct fee related to the leasingtransactions paid by the Company shall be charged to current expenses; if the mount is significant, it shall be capitalized andcharged to current income evenly on the same basis as the leasing income is recognized over the lease term.
When the Company bears the lease related expenses which should be undertaken by the lessee, the Company shall deduct thispart of expense from the rent income, and amortize the net amount over the lease term.
31. Segmental reporting
The company determines the operating segment based on the internal organizational structure, management requirements,and internal reporting system. The segmental reporting is confirmed on operating segment basis, and segment information shall bedisclosed.
The operating segment refers to the components of the company that meet the following conditions simultaneously:
(1) The constituent part shall have income and expenses in the daily activities;
(2) The management of the company can regularly evaluate the operating results of this constituent part and determine theallocation of resources to it and evaluate its performance;
(3) The company can obtain accounting information of the financial status, operating results, cash flow and etc., of theconstituent part.
If two or more operating segments have similar economic features and meet certain conditions, they can be combined intoone operating segment.
32. Changes in significant accounting policies and accounting estimates
(1) Changes in significant accounting policies
√ Applicable □ Not applicable
1) Implementation of "Accounting Standards for Business Enterprises No. 14 - Revenue" (revised in 2017) (hereinafter referredto as "New Revenue Standards")
The Ministry of Finance revised the "Accounting Standards for Business Enterprises No. 14 - Revenue" in 2017 The revisedstandards stipulate that for the first implementation of the standards, the amount of retained earnings and other related items inthe financial statements at the beginning of the year should be adjusted according to the cumulative effects, and the informationfor the comparable period should not be adjusted.
This Company implemented the new revenue standards since January 1, 2020. According to the standards, the company onlyadjusted the retained earnings and other related items in the financial statements at the beginning of the year 2020 for thecumulative effects of contracts that have not been completed on the date of first implementation, and the comparative financialstatements were not adjusted. These standards have the following major effects:
Content and Reasons for Change in Accounting Policies | Approval process | Statements Affected | Affected Amount of Balance on January 1, 2020 | |
Consolidated Subsidiaries | Parent company | |||
(1) The advance payments related to the contractual income are reclassified into the contractual liabilities. | The 6th meeting of the 7th Board of Directors | Received Prepayments | -311,838,903.34 | -731,628.89 |
Contract liabilities | 294,302,487.38 | 710,319.31 | ||
Other Current Liabilities | 17,536,415.96 | 21,309.58 |
Compared with the original revenue standards, implementation of the new revenue standards has the following effects on therelevant items of the financial statements in 2020 (increase/(decrease)):
Balance Sheets Items Affected | Affected Amount of Balance on Thursday, December 31, 2020 | |
Consolidated Subsidiaries | Parent company |
Contract liabilities | 188,550,237.52 | |
Received Prepayments | -192,064,139.60 | |
Other Current Liabilities | 3,513,902.08 |
2) Implementation of "Accounting Standards for Business Enterprises Interpretation No. 13"
The Ministry of Finance issued the "Accounting Standards Interpretation for Business Enterprises No. 13" (CaiKuai [2019] No.21, hereinafter referred to as "Interpretation No. 13") on December 10, 2019, which came into force on January 1, 2020.Retrospective adjustment was not required.
① Identification of Related Parties
Interpretation No. 13 clarifies that the following circumstances constitute a related party: a joint venture or affiliated businessbetween an enterprise and other member units (including parent companies and subsidiaries) of the enterprise group to which itbelongs; a joint venture of the enterprise and other joint ventures or affiliated business. In addition, Interpretation No. 13 alsoclarifies that only two or more companies that are only significantly affected by one party do not constitute a related party. It alsoadds that affiliated business includes affiliated business and their subsidiaries, and joint ventures include joint ventures and theirsubsidiaries.
② Definition of Business
Interpretation No. 13 completes the three elements of business composition, refines the judgment conditions of businesscomposition, and at the same time introduces the "concentration ratio test" option to simplify to a certain extent the problemssuch as judgment of whether a combination obtained under the same control constitutes a business, etc.
The company implemented Interpretation No. 13 since January 1, 2020, and the comparative financial statements were notadjusted. The implementation of Interpretation No. 13 did not have significant impact on the company’s financial status andoperating results.
3) Implementation of the "Interim Provisions on Accounting Treatment of Carbon Emission Rights Trading"
On December 16, 2019, the Ministry of Finance issued the "Interim Provisions on Accounting Treatment of Carbon EmissionRights Trading" (CaiKuai [2019] No. 22), which is applicable to related companies in the key emission units (hereinafter referred toas key emission companies) which operate carbon emission rights trading business in accordance with the "Interim Measures forthe Management of Carbon emission Rights Trading”. This provision came into effect on January 1, 2020, and key emissioncompanies should adopt prospective application to apply this provision.
The company implemented this provision since January 1, 2020, and the comparative financial statements were adjusted. Theimplementation of this provision did not have significant impact on the company’s financial status and operating results.
4) Implementation of the "Provisions on accounting treatment of rent concessions related to COVID-19"
On June 19, 2020, the Ministry of Finance issued the "Provisions on accounting treatment of rent concessions related toCOVID-19" (CaiKuai (2020) No. 10), which came into effect on June 19, 2020, allowing companies to adjust related rent concessionsthat occurred between January 1, 2020 and the implementation date of this provision. According to this provision, for rentconcessions directly caused by COVID-19 that meet the conditions, for example, rent remission and deferred payment of rent,companies can choose to adopt simplified methods for accounting treatment.
The company adopts the simplified method for accounting all rent concessions within the scope the provision, and adjustedthe relevant rent concessions from January 1, 2020 to the date of implementation of the provision accordingly.
As the lessee, this Company adopted simplified methods for treatment of relevant rent concessions in order to write down theoperating costs, management expenses and sales expenses for the current period in the total amount of RMB 13,042,042.83.
As the lessee, this Company adopted simplified methods for treatment of relevant rent concessions in order to write down theoperating costs for the current period, such rent simplification had no significant impact on the Company.
(2) Changes in significant accounting estimates
□ Applicable √ Not applicable
There were no changes in significant accounting estimates during the reporting period.
(3) Since 2020, the Company implemented new revenue standards and new leasing standards for the firsttime, and adjusted the items related to financial statements at the beginning of the year.ApplicableWhether the accounts of the balance sheet at the beginning of the year shall be adjusted
√ Yes □ No
Consolidated Balance Sheet
Unit: RMB
Item | December 31, 2019 | January 1, 2020 | Adjusted amount |
Current Assets: | |||
Cash and Bank Balances | 1,785,124,821.87 | 1,785,124,821.87 | |
Deposit Reservation for Balance | |||
Loans to Banks and Other Financial Institutions | |||
Trading Financial Assets | 854,108,086.54 | 854,108,086.54 | |
Derivative Financial Assets | |||
Note’s receivable | |||
Accounts receivable | 5,337,855.43 | 5,337,855.43 | |
Receivables Financing | |||
Prepayments | 17,221,603.54 | 17,221,603.54 | |
Premium Receivable | |||
Reinsurance Accounts Receivable | |||
Reinsurance Contract Reserves Receivable | |||
Other Receivables | 125,573,266.78 | 125,573,266.78 | |
Including: interest receivable | |||
Dividends Receivable | |||
Buying Back the Sale of |
Financial Assets | |||
Inventory | 6,110,221.56 | 6,110,221.56 | |
Contract Assets | Not applicable | ||
Holding for-sale assets | |||
Non-current Assets Due within 1 Year | |||
Other Current Assets | 127,570,975.96 | 127,570,975.96 | |
Subtotal of Current Assets | 2,921,046,831.68 | 2,921,046,831.68 | |
Non-current Assets: | |||
Granting of loans and advances | |||
Investment in Creditor's Rights | |||
Investment in Other Creditor's Rights | |||
Long-term Receivables | |||
Long-term Equity Investment | 3,468,596,165.08 | 3,468,596,165.08 | |
Investment in Other Equity Instruments | 300,959,931.64 | 300,959,931.64 | |
Other Non-current Financial Assets | |||
Investment Property | |||
Fixed Assets | 2,311,251,277.89 | 2,311,251,277.89 | |
Projects under Construction | 370,000,233.10 | 370,000,233.10 | |
Productive Biological Assets | |||
Oil and gas assets | |||
Right-of-use Assets | |||
Intangible Assets | 1,498,490,129.82 | 1,498,490,129.82 | |
Development Expenditure | |||
Goodwill | 28,078,665.69 | 28,078,665.69 | |
Long-term unamortized expenses | 112,440,627.02 | 112,440,627.02 | |
Deferred Income Tax | 9,148,452.39 | 9,148,452.39 |
Assets | |||
Other Non-current Assets | 21,064,619.27 | 21,064,619.27 | |
Subtotal of Non-current Assets | 8,120,030,101.90 | 8,120,030,101.90 | |
Total Assets | 11,041,076,933.58 | 11,041,076,933.58 | |
Current Liabilities: | |||
Short-term loan | |||
Borrowings from the Central Bank | |||
Borrowings from Banks and Other Financial Institutions | |||
Transactional financial liabilities | |||
Derivative Financial Liabilities | |||
Notes Payable | |||
Accounts Payable | 300,656,879.62 | 300,656,879.62 | |
Received Prepayments | 351,733,456.28 | 39,894,552.94 | -311,838,903.34 |
Contract liabilities | Not applicable | 294,302,487.38 | 294,302,487.38 |
Financial Assets Sold for Repurchase | |||
Deposit Taking and Interbank Deposit | |||
Receiving from Vicariously Traded Securities | |||
Receiving from Vicariously Sold Securities | |||
Payroll payable | 26,737,888.43 | 26,737,888.43 | |
Tax Payable | 22,614,171.64 | 22,614,171.64 | |
Other Payables | 63,299,348.02 | 63,299,348.02 | |
Including: interest payable | |||
Dividends Payable | |||
Service Charge and |
Commission Payable | |||
Reinsurance Accounts Payable | |||
Holding for-sale liabilities | |||
Non-current Liabilities Due within 1 Year | |||
Other Current Liabilities | 17,536,415.96 | 17,536,415.96 | |
Subtotal of Current Liabilities | 765,041,743.99 | 765,041,743.99 | |
Non-current Liabilities: | |||
Insurance Contract Reserves | |||
Long-term loan | |||
Bonds Payable | |||
Including: Preferred Stocks | |||
Perpetual Bonds | |||
Lease Liabilities | |||
Long-term Payables | |||
Long-term payroll payable | |||
Expected Liabilities | |||
Deferred Income | 382,872,318.90 | 382,872,318.90 | |
Deferred Income Tax Liabilities | 10,771,548.18 | 10,771,548.18 | |
Other Non-current Liabilities | |||
Subtotal of Non-current Liabilities | 393,643,867.08 | 393,643,867.08 | |
Total Liabilities | 1,158,685,611.07 | 1,158,685,611.07 | |
Shareholders' Equity: | |||
Share Capital | 1,452,607,800.00 | 1,452,607,800.00 | |
Other Equity Instruments | |||
Including: Preferred Stocks |
Perpetual Bonds | |||
Capital Reserves | 2,476,312,069.09 | 2,476,312,069.09 | |
Less: Treasury Share | |||
Other Comprehensive Incomes | -8,681,151.59 | -8,681,151.59 | |
Special Reserves | |||
Surplus Reserves | 517,673,268.35 | 517,673,268.35 | |
General Risk Reserves | |||
Undistributed Profits | 5,176,157,180.79 | 5,176,157,180.79 | |
Total Shareholders' Equity Attributable to the Parent Company | 9,614,069,166.64 | 9,614,069,166.64 | |
Minority Shareholders' Equity | 268,322,155.87 | 268,322,155.87 | |
Total Shareholders' Equity | 9,882,391,322.51 | 9,882,391,322.51 | |
Total Liabilities and Shareholders' Equity | 11,041,076,933.58 | 11,041,076,933.58 |
Balance Sheet of the Parent Company
Unit: RMB
Item | December 31, 2019 | January 1, 2020 | Adjusted amount |
Current Assets: | |||
Cash and Bank Balances | 645,534,966.84 | 645,534,966.84 | |
Trading Financial Assets | 351,492,520.54 | 351,492,520.54 | |
Derivative Financial Assets | |||
Note’s receivable | |||
Accounts receivable | 1,269,835.09 | 1,269,835.09 | |
Receivables Financing | |||
Prepayments | 2,458,855.65 | 2,458,855.65 | |
Other Receivables | 1,100,294,815.74 | 1,100,294,815.74 | |
Including: interest receivable | |||
Dividends Receivable | |||
Inventory | 2,465,844.42 | 2,465,844.42 |
Contract Assets | Not applicable | ||
Holding for-sale assets | |||
Non-current Assets Due within 1 Year | |||
Other Current Assets | 1,671,867.65 | 1,671,867.65 | |
Subtotal of Current Assets | 2,105,188,705.93 | 2,105,188,705.93 | |
Non-current Assets: | |||
Investment in Creditor's Rights | |||
Investment in Other Creditor's Rights | |||
Long-term Receivables | |||
Long-term Equity Investment | 6,941,849,814.49 | 6,941,849,814.49 | |
Investment in Other Equity Instruments | 294,665,442.88 | 294,665,442.88 | |
Other Non-current Financial Assets | |||
Investment Property | |||
Fixed Assets | 503,463,063.75 | 503,463,063.75 | |
Projects under Construction | 59,331,122.60 | 59,331,122.60 | |
Productive Biological Assets | |||
Oil and gas assets | |||
Right-of-use Assets | |||
Intangible Assets | 145,128,033.35 | 145,128,033.35 | |
Development Expenditure | |||
Goodwill | |||
Long-term unamortized expenses | 10,183,821.75 | 10,183,821.75 | |
Deferred Income Tax Assets | 7,476,137.89 | 7,476,137.89 | |
Other Non-current Assets | 9,838,928.50 | 9,838,928.50 | |
Subtotal of Non-current | 7,971,936,365.21 | 7,971,936,365.21 |
Assets | |||
Total Assets | 10,077,125,071.14 | 10,077,125,071.14 | |
Current Liabilities: | |||
Short-term loan | |||
Transactional financial liabilities | |||
Derivative Financial Liabilities | |||
Notes Payable | |||
Accounts Payable | 44,171,004.81 | 44,171,004.81 | |
Received Prepayments | 22,214,761.65 | 21,483,132.76 | -731,628.89 |
Contract liabilities | Not applicable | 710,319.31 | 710,319.31 |
Payroll payable | 12,673,534.31 | 12,673,534.31 | |
Tax Payable | 4,818,330.21 | 4,818,330.21 | |
Other Payables | 1,953,433,149.11 | 1,953,433,149.11 | |
Including: interest payable | |||
Dividends Payable | |||
Holding for-sale liabilities | |||
Non-current Liabilities Due within 1 Year | |||
Other Current Liabilities | 21,309.58 | 21,309.58 | |
Subtotal of Current Liabilities | 2,037,310,780.09 | 2,037,310,780.09 | |
Non-current Liabilities: | |||
Long-term loan | |||
Bonds Payable | |||
Including: Preferred Stocks | |||
Perpetual Bonds | |||
Lease Liabilities | |||
Long-term Payables | |||
Long-term payroll payable |
Expected Liabilities | |||
Deferred Income | 5,620,598.89 | 5,620,598.89 | |
Deferred Income Tax Liabilities | 9,983,693.86 | 9,983,693.86 | |
Other Non-current Liabilities | |||
Subtotal of Non-current Liabilities | 15,604,292.75 | 15,604,292.75 | |
Total Liabilities | 2,052,915,072.84 | 2,052,915,072.84 | |
Shareholders' Equity: | |||
Share Capital | 1,452,607,800.00 | 1,452,607,800.00 | |
Other Equity Instruments | |||
Including: Preferred Stocks | |||
Perpetual Bonds | |||
Capital Reserves | 2,478,350,525.70 | 2,478,350,525.70 | |
Less: Treasury Share | |||
Other Comprehensive Incomes | 31,870,051.79 | 31,870,051.79 | |
Special Reserves | |||
Surplus Reserves | 517,673,268.35 | 517,673,268.35 | |
Undistributed Profits | 3,543,708,352.46 | 3,543,708,352.46 | |
Total Shareholders' Equity | 8,024,209,998.30 | 8,024,209,998.30 | |
Total Liabilities and Shareholders' Equity | 10,077,125,071.14 | 10,077,125,071.14 |
(4). Explanation of compared data before and after the adjustment according to the first implementation ofthe new revenue recognition standard and the new lease accounting standard in 2020
□ Applicable √ Not applicable
VI. Taxes
1. Major categories of taxes and tax rates
Tax Type | Taxation basis | Tax rate |
VAT | According to the provisions of the tax law, the sales tax shall be calculated on the basis of the income by selling goods and taxable services. After deducting the input tax that is allowed to be deducted from the sales tax in the current period, the difference shall be the value added tax | Simple levy 3%, 5% General taxpayer 6% General taxpayers 16%, 13%, 10%, 9% |
Urban Maintenance and Construction Tax | Calculated and paid based on the actual value-added tax and consumption tax | 5%, 7% |
Enterprise Income Tax | Calculated based on the taxable income | 25%, please refer to below table for details of different tax rates |
House property tax | Lease is based on rental income; self-use fixed assets are based on the original value of fixed assets | 12%, 1.2% |
Education Surcharges | Calculated and paid based on the actual value-added tax and consumption tax | 5% |
If there are taxpayers with different corporate income tax rates, the disclosure shall be explained:
Name of taxpayer | Income tax rate |
Sanya Romance Tourism Performance Co., Ltd. | 15% |
Lijiang Chama Ancient City Tourism Development Co., Ltd | 15% |
Aba Zhou Jiuzhai Romance Tourism Development Co., Ltd | 15% |
Hangzhou Songcheng Tourism Development Co., Ltd | 15% |
Jiuzhaigou Tibetan Mystery Culture Co., Ltd | 15% |
Hangzhou Songcheng Technology Development Co., Ltd. | 15% |
Songcheng Performance International Development Co., Ltd. | Local tax rate 16.50% |
Songcheng (Australia) Holdings Pty Ltd | Less than AUD 10 million, tax rate 27.5% |
Songcheng (Australia) Entertainment Pty Ltd. | Less than AUD 10 million, tax rate 27.5% |
Songcheng Performance Development (Shanghai) Co., Ltd. | The tax rate for small and micro enterprise |
Guilin Lijiang Romance Performance Development Co., Ltd | 15% |
Songcheng Dumuqiao Network Co., Ltd. | 15% |
Xi'an Romance Performance Development Co., Ltd | 15% |
Songcheng Holdings (Thailand) Co., Ltd. | Tax rate of Thailand 15% |
Songcheng (Pattaya) International Culture Co., Ltd. | Tax rate of Thailand 15% |
2. Preferential tax rate
Preferential value-added tax:
According to the "Announcement of the Ministry of Finance and the State Administration of Taxation on Supporting TaxPolicies for the Prevention and Control of the Novel Coronavirus Pneumonia Epidemic" (No. 8 of Year 2020), starting from January 1,2020, Taxpayer’s income from providing life services and public transportation services shall be exempted from value-added tax.According to the "Announcement of the Ministry of Finance and the State Administration of Taxation on Supporting IndividualIndustrial and Commercial Households Resuming Work and Resumption of Value-Added Tax Policies"( Caishui No. 13 of Year 2020),3% taxable sales income is applicable to small-scale taxpayers, and value-added tax of 1% is applied.
Preferential of property tax and land use tax:
Companies that have business difficulties due to epidemic shall be exempted from the property tax and land use tax thatshould be paid, which shall be subject to local preferential policies.
Preferential corporate income tax rate:
Lijiang Chama Ancient City Tourism Development Co., Ltd, Aba Zhou Jiuzhai Romance Tourism Development Co., Ltd, JiuzhaigouTibetan Mystery Culture Co., Ltd, Guilin Lijiang Romance Performance Development Co., Ltd and Xi'an Romance PerformanceDevelopment Co., Ltd. enjoy the preferential tax policy of west development, which corporate income tax rate is 15%.
Songcheng Tourism Development Co., Ltd., Hangzhou Songcheng Technology Development Co., Ltd, and Songcheng DumuqiaoNetwork Co., Ltd. are high-tech enterprises, which corporate income tax rate is 15% in 2020.
According to "Notice on the Hainan Free Trade Port’s Preferential Policies on Corporate Income Tax"( Caishui No. 31 of Year2020), from January 1, 2020 to December 31, 2024, enterprises that are registered in Hainan Free Trade Port with substantialoperation record are levied at a reduced rate of 15% for their corporate income. In addition, Sanya Romance Tourism PerformanceCo., Ltd obtained the "High-tech Enterprise Certificate" on December 1, 2020, which is valid for three years. For Sanya RomanceTourism Performance Co., Ltd., the corporate income tax was levied at the rate of 15% in 2020.
According to "Notice of the Ministry of Finance and the State Administration of Taxation on Preferential Corporate Income TaxPolicies for the Two Special Economic Development Zones Kashgar and Horgos, in Xinjiang"( Caishui No. 112 of Year 2011), duringJanuary 1, 2010 to December 31, 2020, the newly established enterprise in two special economic development zones of Kashgarand Horgos in Xinjiang that fall within the scope of the "Catalogue of Enterprise Income Tax Preferences for Key Industries inDifficult Areas in Xinjiang", shall be exempted for corporate income tax for future five years starting from the tax year in which thefirst production and operation income is obtained. The Songcheng Technology Development Co., Ltd., Songcheng TourismDevelopment Co., Ltd., Songcheng Performance Management Co., Ltd. (Horgo Headquarters), Songcheng Brand Management Co.,Ltd. and Romance Art Management Co., Ltd. subordinate to the company meet the conditions of the preferential policy , and shallbe exempted from corporate income tax in 2020.
According to the "Notice of the Ministry of Finance and the State Administration of Taxation on the Implementation ofInclusive Tax Reduction and Exemption Policies for Small and Micro Enterprises" (Caishui No.13 of Year 2019),for the portion ofannual taxable income of small and low profit enterprises that is less than RMB 1 million shall be included in the taxable income at areduced rate of 25%, and the enterprise income tax shall be paid at the tax rate of 20%. For the portion of the annual taxableincome exceeding RMB 1 million but not exceeding RMB 3 million, it shall be included in taxable income at a reduced rate of 50%,and the corporate income tax is paid at the tax rate of 20%. The execution period is from January 1, 2019 to December 31, 2021.The company that meets the requirements of small and micro enterprises of this year is: Songcheng Performance Development(Shanghai) Co., Ltd.VII. Notes to the Items in the Consolidated Financial Statement
1. Cash and bank balances
Unit: RMB
Item | Balance at the End of the Period | Balance at the Start of the Period |
Cash on Hand | 2,437,262.81 | 2,237,068.96 |
Bank Balance | 1,285,458,896.93 | 1,780,608,638.49 |
Other Cash and Bank Balances | 49,880,094.24 | 2,279,114.42 |
Total | 1,337,776,253.98 | 1,785,124,821.87 |
Including: Total Amount Deposited in Overseas Banks | 116,361,545.59 | 180,380,176.66 |
2. Trading Financial Assets
Unit: RMB
Item | Balance at the End of the Period | Balance at the Start of the Period |
Financial assets at fair value through profit or loss in this period | 335,217,557.68 | 854,108,086.54 |
Including: | ||
Investment in equity instruments | 172,445,378.26 | 110,024,148.79 |
Derivative Financial Assets | 6,589,730.08 | |
Bank financial products | 156,182,449.34 | 744,083,937.75 |
Financial assets measured in fair value with changes recognized in current profit and loss | ||
Including: | ||
Total | 335,217,557.68 | 854,108,086.54 |
3. Accounts receivable
(1) Categorical disclosure of accounts receivable
Unit: RMB
Category | Balance at the End of the Period | Balance at the Start of the Period | ||||||||
Book balance | Bad debt provision | Book value | Book balance | Bad debt provision | Book value | |||||
Amount | Percentage | Amount | Accrued proportion | Amount | Percentage | Amount | Accrued proportion | |||
Including: | ||||||||||
Accounts receivables with the bad debt provision accrued based on combinations | 6,285,542.60 | 100.00% | 398,530.24 | 6.34% | 5,887,012.36 | 5,547,592.45 | 100.00% | 209,737.02 | 3.78% | 5,337,855.43 |
Including: | ||||||||||
Combination of credit risk characteristics by age | 6,285,542.60 | 100.00% | 398,530.24 | 6.34% | 5,887,012.36 | 5,547,592.45 | 100.00% | 209,737.02 | 3.78% | 5,337,855.43 |
Total | 6,285,542.60 | 100.00% | 398,530.24 | 5,887,012.36 | 5,547,592.45 | 100.00% | 209,737.02 | 5,337,855.43 |
Bad debt provision based on combinationsAmong them: combination of credit risk characteristics by age:
Unit: RMB
Name | Balance at the End of the Period | ||
Book balance | Bad debt provision | Accrued proportion | |
Within credit period | 4,643,522.08 | 139,305.67 | 3.00% |
Credit period overdue within 1 year | 1,603,495.69 | 240,524.36 | 15.00% |
Credit period overdue within 1 to 2 years | 20,679.83 | 5,169.96 | 25.00% |
Credit period overdue within 2 to 3 years | 7,845.00 | 3,530.25 | 45.00% |
Credit period overdue within 3 to 4 years | 60.00% | ||
Credit period overdue within 4 to 5 years | 80.00% | ||
Credit period overdue for more than 5 years | 10,000.00 | 10,000.00 | 100.00% |
Total | 6,285,542.60 | 398,530.24 | -- |
Please refer to the disclosing methods of other receivables for the information disclosure of bad debts provisions, if the bad debtprovisions of accounts receivable are made according to the general model of expected credit losses:
□ Applicable √ Not applicable
Disclosure by age
Unit: RMB
Aging | Book balance |
Within 1 year | 6,143,007.77 |
1 to 2 years | 124,689.83 |
2 to 3 years | 7,845.00 |
3 to 4 years |
4 to 5 years | |
5 years or above | 10,000.00 |
Total | 6,285,542.60 |
(2) Provision for bad debts accrued, recovered or reversed in this period
Unit: RMB
Category | Balance at the Start of the Period | Amount of Changes in the Current Period | Balance at the End of the Period | |||
Accrued | Recovered or Reversed | Written Off | Others | |||
Provision for bad debts of accounts receivable | 209,737.02 | 188,793.22 | 398,530.24 | |||
Total | 209,737.02 | 188,793.22 | 398,530.24 |
(3) Accounts receivable actually written off in this period
There are no accounts receivable actually written off in the current period.
(4) Accounts receivable of the top five closing balances collected by debtors
Unit: RMB
Name of Unit | Accounts receivable at the end of the period | Proportion of the total accounts receivable at the end pf the period | Bad debt provision at the end of the period |
Alipay (China) Network Technology Co., Ltd. | 4,334,670.63 | 68.96% | 130,040.12 |
Henan Longgui Cultural Tourism Development Co., Ltd. | 557,438.58 | 8.87% | 82,958.13 |
Tenpay Payment Technology Co., Ltd. | 313,622.60 | 4.99% | 9,408.68 |
Yangshuo County Government Office | 183,680.00 | 2.92% | 17,991.60 |
Qingdao Yilu International Travel Agency Co., Ltd. | 170,233.44 | 2.71% | 25,535.02 |
Total | 5,559,645.25 | 88.45% |
4. Prepayments
(1) Aging analysis of prepayments is as follows
Unit: RMB
Aging | Balance at the End of the Period | Balance at the Start of the Period | ||
Amount | Percentage | Amount | Percentage | |
Within 1 year | 19,868,443.81 | 90.58% | 16,154,582.37 | 93.80% |
1 to 2 years | 1,749,615.05 | 7.98% | 1,067,021.17 | 6.20% |
2 to 3 years | 316,167.68 | 1.44% | ||
Total | 21,934,226.54 | -- | 17,221,603.54 | -- |
(2) Advance payment of the top five closing balances by prepayment parties
Prepayment parties | Balance at the End of the Period | Proportion to the total balance of prepayment at the end of the period (%) |
Hangzhou World Leisure Expo Park Co., Ltd | 2,997,262.50 | 13.66 |
Tianjin Kuxun Interactive Technology Co., Ltd. | 2,000,000.00 | 9.12 |
Hangzhou Bus Media Group Co., Ltd. | 1,966,797.79 | 8.97 |
China Music Copyright Association | 1,623,809.52 | 7.40 |
Guangxi Sutie Culture Media Co., Ltd. | 867,924.54 | 3.96 |
Total | 9,455,794.35 | 43.11 |
5. Other receivables
Unit: RMB
Item | Balance at the End of the Period | Balance at the Start of the Period |
Interest Receivable | ||
Dividends Receivable | ||
Other Receivables | 50,524,990.69 | 125,573,266.78 |
Total | 50,524,990.69 | 125,573,266.78 |
(1) Other Receivables
1) Other receivables categorized by the nature of the funds
Unit: RMB
Nature of the funds | Closing balance | Opening balance |
Employee loan | 2,772,031.55 | 1,907,266.72 |
Security deposit, deposit | 14,126,496.40 | 17,670,537.00 |
Incomings and outgoings | 9,306,779.16 | 43,496,759.94 |
Equity transfer fund | 79,866,980.26 | 79,866,980.26 |
Pending compensation for tourists | 25,134.24 | 485,838.76 |
Others | 2,153,015.26 | 2,494,950.95 |
Estimated input VAT | 7,551,113.16 | 12,302,526.06 |
Total | 115,801,550.03 | 158,224,859.69 |
Estimated input VAT: When the assets of the scenic spot are put into use, the company shall carry forward the fixed assets afterdeducting the estimated input VAT based on the estimated total project cos. After the project is completed and invoiced, the fixedassets shall be transferred to taxable input VAT.
2) Bad debt provision
Unit: RMB
Bad debt provision | Phase One | Phase Two | Phase Three | Total |
Expected credit losses in the next 12 months | Expected credit losses for the entire extension (without credit impairment) | Expected credit losses for the entire extension (with credit impairment) | ||
Balance on January 1, 2020 | 2,530,167.06 | 30,121,425.85 | 32,651,592.91 | |
Balance of the current period on January 1, 2020 | —— | —— | —— | —— |
--Transfer to phase three | -326,304.12 | 326,304.12 | ||
Provisions of this period | -1,846,125.80 | 34,397,309.49 | 32,551,183.69 | |
Other variations | 46,556.94 | 27,225.80 | 73,782.74 | |
Balance on December 31, 2020 | 404,294.08 | 64,872,265.26 | 65,276,559.34 |
Book balance changes with significant changes in loss provision in the current period
□ Applicable √ Not applicable
Disclosure by age
Unit: RMB
Aging | Book balance |
Within 1 year | 8,456,388.73 |
1 to 2 years | 11,907,312.54 |
2 to 3 years | 2,111,159.10 |
3 to 4 years | 81,587,265.26 |
4 to 5 years | 10,060,000.00 |
5 years or above | 1,679,424.40 |
Total | 115,801,550.03 |
3) Provision for bad debts accrued, recovered or reversed in this period
Unit: RMB
Category | Balance at the Start of the Period | Amount of Changes in the Current Period | Balance at the End of the Period | |||
Accrued | Recovered or Reversed | Written Off | Others | |||
Provision for bad debts of other receivables | 32,651,592.91 | 32,551,183.69 | 73,782.74 | 65,276,559.34 | ||
Total | 32,651,592.91 | 32,551,183.69 | 73,782.74 | 65,276,559.34 |
4) Accounts receivable actually written off in this period
There are no actual written-off accounts receivable in this period.
5) Other receivables of the top five closing balances collected by debtors
Unit: RMB
Name of Unit | Nature of the funds | Balance at the End of the Period | Aging | As a percentage of total other receivables at the end of the period | Bad debt provision at the end of the period |
An Xiaofen (formerly: Horgos Dasheng Legend Venture Capital Co., Ltd.) | Equity transfer fund | 79,866,980.26 | 3-4 years | 68.97% | 61,242,660.26 |
Shanghai World Expo Dongdi Cultural Development Co., Ltd. | Project development deposit | 10,000,000.00 | 4-5 years | 8.64% | 200,000.00 |
Ningxiang Cultural | Project management | 6,241,000.00 | 1 to 2 years | 5.39% | 1,515,250.00 |
Tourism Investment Co., Ltd. | fee, incentive fee | ||||
New rural cooperative medical insurance and other funds | Deposits | 1,260,206.00 | 3-4 years | 1.09% | 630,103.00 |
Beijing Muma Constellation Culture Communication Co., Ltd. | Loan | 1,050,000.00 | 5 years or above | 0.91% | 1,050,000.00 |
Total | -- | 98,418,186.26 | -- | 85.00% | 64,638,013.26 |
6. Inventory
Does the company need to comply with the disclosure requirements of the real estate industryNo
(1) Categories of inventories
Unit: RMB
Item | Balance at the End of the Period | Balance at the Start of the Period | ||||
Book balance | Inventory depreciation provision or contract performance cost impairment provision | Book value | Book balance | Inventory depreciation provision or contract performance cost impairment provision | Book value | |
Finished goods | 11,685,709.47 | 11,685,709.47 | 4,306,091.80 | 4,306,091.80 | ||
Materials in stock | 1,738,437.03 | 1,738,437.03 | 1,804,129.76 | 1,804,129.76 | ||
Total | 13,424,146.50 | 13,424,146.50 | 6,110,221.56 | 6,110,221.56 |
7. Other current assets
Unit: RMB
Item | Balance at the End of the Period | Balance at the Start of the Period |
Prepayment of value-added tax and VAT input tax that has not yet been deducted | 132,363,780.35 | 109,478,957.39 |
Prepayment of corporate income tax | 14,275,564.96 | 15,274,526.56 |
Prepayment of other additional taxes | 2,002,059.16 | 2,817,492.01 |
Total | 148,641,404.47 | 127,570,975.96 |
8. Long-term equity investment
Unit: RMB
The invested entity | Balance at the Start of the Period (book value) | Decrease/Increase in the current period | Balance at the End of the Period (book value) | Closing balance of provision for decline in value | |||||||
Investments increased | Investment decreased | Investment profit and loss recognized under the equity method | Adjustment on other comprehensive income | Other changes in equity | Cash dividends or profit declared to distribute | Provision for impairment accrued | Others | ||||
Ⅰ. Joint ventures | |||||||||||
Ⅱ. Affiliates | |||||||||||
Beijing Beite Shengdi Technology Development Co., Ltd. | 42,143,812.03 | -531,556.58 | 41,612,255.45 | ||||||||
Beijing Huafang Technology Co., Ltd. (formerly known as Beijing Six Rooms Technology Co., Ltd.) | 3,426,452,353.05 | -6,181,998.23 | 1,356,586.59 | -67,402,286.85 | -1,861,297,284.90 | 1,492,927,369.66 | 1,861,297,284.90 | ||||
Subtotal | 3,468,596,165.08 | -6,713,554.81 | 1,356,586.59 | -67,402,286.85 | -1,861,297,284.90 | 1,534,539,625.11 | 1,861,297,284.90 |
Total | 3,468,596,165.08 | -6,713,554.81 | 1,356,586.59 | -67,402,286.85 | -1,861,297,284.90 | 1,534,539,625.11 | 1,861,297,284.90 |
Other notes:
(1) Other equity changes in the current period:
In November 2020, Beijing Huafang Technology Co., Ltd. (formerly known as Beijing Six Rooms Technology Co., Ltd.) increasedits registered capital from RMB 50 million to RMB 53,333,300, and the investment of the company in Beijing Huafang TechnologyCo., Ltd. was passively diluted from 39.53% to 37.06%. Using equity method for accounting, the company recognizes the long-termequity corresponding to the increase in net assets of Beijing Huafang Technology Co., Ltd. due to its capital increase and shareexpansion. In addition, the decrease in the shareholding ratio should be carried forward according to the new shareholding ratio.The difference of RMB -97,391,766.67 between the book value of the corresponding long-term equity investment was recognized incapital reserve. In the current period, the book value of long-term equity investment was adjusted to RMB 29,989,479.82 due tochanges in owner‘s equity other than net profit and loss of the invested unit Beijing Huafang Technology Co., Ltd.
(2) Provision for impairment
The equity of the company was passively diluted on November 10, 2020. According to the requirements of the "Guidelines forthe Application of Regulatory Rules-Accounting No. 1" issued by CSRC on November 13, 2020, the company adopts the equitymethod to calculate long-term equity investments. If the investor suffers losses due to passive dilution of equity, the loss causedthereby shall be regarded as one of the signs of impairment of equity investments. Impairment test on the equity investmentshould be conducted. If impairment occurs, the impairment loss of the equity investment shall be recognized first, and then theimpact of equity dilution shall be calculated. The accounting treatment of the company adopted the "Guidelines for the Applicationof Regulatory Rules-Accounting No. 1", and China United Assets Appraisal Group Co., Ltd. was hired for the impairment test oflong-term equity investments with the company‘s base date of December 31, 2020. In addition, the long-term equity investment ofthe company with a base date of November 30, 2020 (date of equity dilution statement) was assessed for impairment testing.
According to the evaluation results of "The Asset Appraisal Report on Recoverable Amount Asset Appraisal Project of BeijingHuafang Technology Co.,Ltd Involved in the Impairment Test of the Long-term Equity Investment That Songcheng PerformanceDevelopment Co., Ltd Held" (No. 1076 of Year 2021), issued by China United Assets Appraisal Group Co., Ltd. hired by the company,as of November 30, 2020, the value of all shareholders’ equity of Beijing Huafang Technology Co., Ltd. was RMB 3,993,000,000.00.The recoverable amount RMB 1,578,432,900.00 of long-term equity investment was calculated according to the investment ratiowhich was lower than the book value of long-term equity investment of RMB 3,439,730,184.90. The difference of RMB1,861,297,284.90 was recognized as provision for impairment.
According to the evaluation results of the long-term equity investment impairment test conducted by China United AssetsAppraisal Group Co., Ltd. as of December 31, 2020 (Zhonglian Pingbao Zi No 1075 of Year 2021) , the recoverable amount oflong-term equity investment of the company was not lower than the book value after the impairment of long-term equityinvestment.
9. Investment in other equity instruments
Unit: RMB
(1)Investment in other equity instruments
Item | Balance at the End of the Period | Balance at the Start of the Period |
Ningno Songcheng Performance Live Entertainment Investment Partnership (limited partnership) | 133,565,454.00 | 174,529,872.00 |
Ningno Songcheng Internet Entertainment Investment Partnership (limited partnership) | 78,389,515.54 | 116,236,828.52 |
Ningno Meishan Bonded Port Area Qixian Innovation Entertainment Investment Partnership (limited partnership) | 2,093,286.88 | 3,264,260.36 |
Ningbo Songcheng Qixian Investment Management Co., Ltd. | 926,910.00 | 634,482.00 |
SABH's Big Adventure Inc. | 9,291,430.32 | 6,294,488.76 |
Total | 224,266,596.74 | 300,959,931.64 |
(2) Investment in non-trading equity instruments
Unit: RMB
Item Name | Recognized dividend income | Cumulative gain | Accumulated loss | The amount of other comprehensive income transferred to retained earnings | Reason for designation as being measured at fair value and the change included in other comprehensive income | Reason for transferring other comprehensive income to retained earning |
Ningno Songcheng Performance Live Entertainment Investment Partnership (limited partnership) | 47,542,261.31 | Long-term holding of company strategy | ||||
Ningno Songcheng Internet Entertainment Investment Partnership (limited partnership) | 32,156,015.54 | Long-term holding of company strategy | ||||
Ningno Meishan Bonded Port Area Qixian Innovation Entertainment Investment | 26,406,713.12 | Long-term holding of company strategy |
Partnership (limited partnership) | ||||||
Ningbo Songcheng Qixian Investment Management Co., Ltd. | 544,937.31 | Long-term holding of company strategy | ||||
SABH's Big Adventure Inc. | 17,342,677.79 | Long-term holding of company strategy | ||||
Total | 32,700,952.85 | 91,291,652.22 |
10. Fixed assets
Unit: RMB
Item | Balance at the End of the Period | Balance at the Start of the Period |
Fixed Assets | 2,508,754,929.16 | 2,311,251,277.89 |
Disposal of fixed assets | ||
Total | 2,508,754,929.16 | 2,311,251,277.89 |
(1) Fixed assets
Unit: RMB
Item | Housing and building | General Equipment | Machinery and equipment | Transportation Equipment | Other equipment | Total |
Ⅰ. Original book value: | ||||||
1. Opening Balance | 2,311,133,332.21 | 325,981,009.36 | 711,868,099.91 | 46,950,282.21 | 3,234,328.33 | 3,399,167,052.02 |
2. Increased in the Current Period | 208,761,081.85 | 87,323,579.28 | 128,756,392.89 | 1,725,720.65 | 426,566,774.67 | |
(1) Purchase | 19,386,449.99 | 2,543,105.07 | 997,520.65 | 22,927,075.71 | ||
(2) Transferred From Construction in Progress | 207,501,117.27 | 67,617,877.79 | 126,213,287.82 | 401,332,282.88 | ||
(3) Acquisition | 1,259,964.58 | 319,251.50 | 728,200.00 | 2,307,416.08 | ||
3. Decreased in the Current Period | 26,951,538.22 | 40,832,882.46 | 64,952,599.03 | 582,655.00 | 500,000.00 | 133,819,674.71 |
(1) Disposal or | 26,951,538.22 | 40,832,882.46 | 64,952,599.03 | 582,655.00 | 500,000.00 | 133,819,674.71 |
Scrapping | ||||||
4. Closing Balance | 2,492,942,875.84 | 372,471,706.18 | 775,671,893.77 | 48,093,347.86 | 2,734,328.33 | 3,691,914,151.98 |
II. Accumulated depreciation | ||||||
1. Opening Balance | 474,761,446.20 | 238,854,625.01 | 349,875,329.35 | 21,445,860.93 | 2,978,512.64 | 1,087,915,774.13 |
2. Increased in the Current Period | 89,189,946.98 | 43,364,023.06 | 62,073,220.49 | 7,991,554.84 | 53,329.05 | 202,672,074.42 |
(1) Accrual | 88,809,054.84 | 43,063,286.46 | 62,073,220.49 | 7,386,359.83 | 53,329.05 | 201,385,250.67 |
(2) Acquisition | 380,892.14 | 300,736.60 | 605,195.01 | 1,286,823.75 | ||
3. Decreased in the Current Period | 13,048,524.57 | 35,439,992.88 | 57,958,126.46 | 496,981.82 | 485,000.00 | 107,428,625.73 |
(1) Disposal or Scrapping | 13,048,524.57 | 35,439,992.88 | 57,958,126.46 | 496,981.82 | 485,000.00 | 107,428,625.73 |
4. Closing Balance | 550,902,868.61 | 246,778,655.19 | 353,990,423.38 | 28,940,433.95 | 2,546,841.69 | 1,183,159,222.82 |
Ⅲ. Provision for Impairment | ||||||
1. Opening Balance | ||||||
2. Increased in the Current Period | ||||||
(1) Accrual | ||||||
3. Decreased in the Current Period | ||||||
(1) Disposal or Scrapping | ||||||
4. Closing Balance | ||||||
IV. Book value | ||||||
1. Closing Balance on Book Value | 1,942,040,007.23 | 125,693,050.99 | 421,681,470.39 | 19,152,913.91 | 187,486.64 | 2,508,754,929.16 |
2. Opening Balance on Book Value | 1,836,371,886.01 | 87,126,384.35 | 361,992,770.56 | 25,504,421.28 | 255,815.69 | 2,311,251,277.89 |
11. Construction in progress
Unit: RMB
Item | Balance at the End of the Period | Balance at the Start of the Period |
Projects under Construction | 771,871,563.73 | 370,000,233.10 |
Construction material | ||
Total | 771,871,563.73 | 370,000,233.10 |
(1) Details of construction in progress
Unit: RMB
Item | Balance at the End of the Period | Balance at the Start of the Period | ||||
Book balance | Provision for decline in value | Book value | Book balance | Provision for decline in value | Book value | |
Songcheng Scenic Area No. 3 and No. 4 Theater Renovation Project | 58,199,776.60 | 58,199,776.60 | ||||
Songcheng Scenic Area Renovation Project | 31,455,175.30 | 31,455,175.30 | ||||
Crazy Apple Land Renovation Project | 1,131,346.00 | 1,131,346.00 | ||||
Hangzhou Paradise Cableway Project | 21,377,209.00 | 21,377,209.00 | ||||
Hangzhou Paradise Upgrading and Renovation Project | 1,338,840.00 | 1,338,840.00 | ||||
Sanya Romance Project | 67,799,438.26 | 67,799,438.26 | 68,079,547.97 | 68,079,547.97 | ||
Lijiang Chama Ancient City Renovation Project | 84,480.00 | 84,480.00 | ||||
Jiuzhai Romance Renovation Project | 7,464,874.00 | 7,464,874.00 | ||||
Longquan Mountain Tourism | 350,943.40 | 350,943.40 | 350,943.40 | 350,943.40 |
Development Project | ||||||
Australian Legend Project | 8,051,137.07 | 8,051,137.07 | 7,378,436.19 | 7,378,436.19 | ||
Shanghai World Expo Grand Theater Project | 294,784,853.21 | 294,784,853.21 | 102,352,040.40 | 102,352,040.40 | ||
Guilin Lijiang Romance Renovation Project | ||||||
Zhangjiajie Romance Renovation Project | 57,752,884.45 | 57,752,884.45 | 6,525,333.52 | 6,525,333.52 | ||
Xi'an Romance Project | 44,575,845.40 | 44,575,845.40 | 46,062,519.11 | 46,062,519.11 | ||
Xitang Performance Valley Project | 101,251,838.34 | 101,251,838.34 | 32,110,163.81 | 32,110,163.81 | ||
South Sea Qiao Mountain Romance Project | 100,613,590.87 | 100,613,590.87 | 17,544,723.10 | 17,544,723.10 | ||
Zhuhai Performance Kingdom Project | 65,235,857.43 | 65,235,857.43 | ||||
Total | 771,871,563.73 | 771,871,563.73 | 370,000,233.10 | 370,000,233.10 |
(2) Changes in significant construction in progress
Unit: RMB
Item Name | Budget | Balance at the Start of the Period | Increased in the current period | Transfer amounts in this period | Other amounts decreased in current period | Balance at the End of the Period | Project accumulative investment as a percentage of the budget | Project Progress | Accumulated capitalized interest amount | Including: capitalized interest amount in the current period | Capitalization rate of the interest in the current period | Capital Source |
Songcheng Scenic Area No. 3 and No. 4 Theater Renovation Project | 160,790,000.00 | 58,199,776.60 | 112,842,927.40 | 170,294,743.00 | 747,961.00 | 106.38% | 100.00% | Others | ||||
Songcheng Scenic Area Renovation Project | 188,344,300.00 | 125,023,727.11 | 60,896,475.20 | 32,672,076.61 | 31,455,175.30 | 66.38% | 80.00% | Others | ||||
Crazy Apple Land Renovation Project | 3,000,000.00 | 1,131,346.00 | 1,293,492.00 | 1,947,928.00 | 476,910.00 | 80.83% | 100.00% | Others | ||||
Hangzhou Paradise Cableway Project | 22,185,540.00 | 21,377,209.00 | 578,660.00 | 21,955,869.00 | 98.96% | 100.00% | Others | |||||
Hangzhou Paradise Upgrading and Renovation Project | 28,383,000.00 | 1,338,840.00 | 18,392,930.05 | 14,372,889.70 | 5,358,880.35 | 69.52% | 100.00% | Others | ||||
Sanya Romance Project | 90,000,000.00 | 68,079,547.97 | 14,174,485.29 | 12,261,137.00 | 2,193,458.00 | 67,799,438.26 | 91.39% | 95.00% | Others | |||
Lijiang Chama Ancient City Renovation Project | 12,226,191.93 | 84,480.00 | 11,163,785.09 | 4,900,996.69 | 6,347,268.40 | 92.00% | 100.00% | Others | ||||
Jiuzhai Romance Renovation Project | 48,510,000.00 | 7,464,874.00 | 24,956,883.82 | 29,641,013.40 | 2,780,744.42 | 66.84% | 100.00% | Others | ||||
Longquan Mountain | 212,588,000.00 | 350,943.40 | 9,836.28 | 9,836.28 | 350,943.40 | 69.80% | 90.00% | Others |
Tourism Development Project | ||||||||||||
Australian Legend Project | 1,692,380,000.00 | 7,378,436.19 | 672,700.88 | 8,051,137.07 | 0.48% | 2.00% | Others | |||||
Shanghai World Expo Grand Theater Project | 830,260,000.00 | 102,352,040.40 | 192,432,812.81 | 294,784,853.21 | 35.51% | 90.00% | Others | |||||
Guilin Lijiang Romance Renovation Project | 15,477,872.07 | 14,742,695.86 | 13,026,913.87 | 1,715,781.99 | 95.25% | 100.00% | Others | |||||
Zhangjiajie Romance Renovation Project | 123,920,000.00 | 6,525,333.52 | 49,249,285.71 | -2,516,897.53 | 538,632.31 | 57,752,884.45 | 45.01% | 95.00% | Others | |||
Xi'an Romance Project | 480,000,000.00 | 46,062,519.11 | 183,273,744.37 | 74,541,378.27 | 110,219,039.81 | 44,575,845.40 | 47.78% | 60.00% | Others | |||
Xitang Performance Valley Project | 400,000,000.00 | 32,110,163.81 | 69,141,674.53 | 101,251,838.34 | 25.31% | 40.00% | Others | |||||
South Sea Qiao Mountain Romance Project | 700,000,000.00 | 17,544,723.10 | 83,068,867.77 | 100,613,590.87 | 14.37% | 50.00% | Others | |||||
Zhuhai Performance Kingdom Project | 2,500,000,000.00 | 65,235,857.43 | 65,235,857.43 | 2.61% | 2.00% | Others | ||||||
Total | 7,508,064,90 | 370,000,23 | 966,254,36 | 401,332,28 | 163,050,75 | 771,871,56 | -- |
4.00 | 3.10 | 6.40 | 2.88 | 2.89 | 3.73 |
Details of changes in the projects under construction: Other reductions of RMB 163,050,752.89 in the current period are thetransfer of long-term deferred expenses amounting to RMB 125,574,936.70 and the transfer of operating costs of maintenance andimprovement amounting to RMB 37,475,816.19.
For Zhangjiajie Romance Project, the amount of fixed assets transferred into the current period was RMB-2,516,897.53. Theoriginal value of fixed assets shall be adjusted correspondingly to the difference in the final accounts of the previous projectscompleted in this period.
12. Intangible assets
(1) Details of intangible assets
Unit: RMB
Item | Land use rights | Patent right | Non-patented technology | Computer Software | Intellectual Property | Vehicle license plate | Total |
Ⅰ. Original book value | |||||||
1. Opening Balance | 1,649,920,722.90 | 40,323,649.98 | 600,000.00 | 151,000.00 | 1,690,995,372.88 | ||
2. Increased in the Current Period | 436,767,296.90 | 2,339,383.71 | 99,800.00 | 439,206,480.61 | |||
(1) Purchase | 7,743,540.89 | 2,339,383.71 | 99,800.00 | 10,182,724.60 | |||
(2) Internal research and development | |||||||
(3) Acquisition | 429,023,756.01 | 429,023,756.01 | |||||
3. Decreased in the Current Period | |||||||
(1) Disposal | |||||||
4. Closing Balance | 2,086,688,019.80 | 42,663,033.69 | 600,000.00 | 250,800.00 | 2,130,201,853.49 | ||
Ⅱ. Accumulated amortization | |||||||
1. Opening Balance | 181,383,655.06 | 10,860,063.11 | 220,000.00 | 41,524.89 | 192,505,243.06 | ||
2. Increased in the Current Period | 51,157,924.94 | 6,425,009.61 | 60,000.00 | 21,753.32 | 57,664,687.87 | ||
(1) Accrual | 50,163,049.74 | 6,425,009.61 | 60,000.00 | 21,753.32 | 56,669,812.67 | ||
(2) Acquisition | 994,875.20 | 994,875.20 | |||||
3. Decreased in the Current Period | |||||||
(1) Disposal | |||||||
4. Closing Balance | 232,541,580.00 | 17,285,072.72 | 280,000.00 | 63,278.21 | 250,169,930.93 | ||
Ⅲ. Provision for Impairment | |||||||
1. Opening Balance | |||||||
2. Increased in the Current Period | |||||||
(1) Accrual | |||||||
3. Decreased in the Current |
Period | |||||||
(1) Disposal | |||||||
4. Closing Balance | |||||||
Ⅳ. Book value | |||||||
1. Closing Balance on Book Value | 1,854,146,439.80 | 25,377,960.97 | 320,000.00 | 187,521.79 | 1,880,031,922.56 | ||
2. Opening Balance on Book Value | 1,468,537,067.84 | 29,463,586.87 | 380,000.00 | 109,475.11 | 1,498,490,129.82 |
13. Goodwill
(1) Original book value of goodwill
Unit: RMB
The invested entity or matters which formed goodwill | Balance at the Start of the Period | Increased in the current period | Decreased in the current period | Balance at the End of the Period | ||
Generated from business combination | Disposal | |||||
Jiuzhaigou Tibetan Mystery Culture Co., Ltd | 45,504,625.96 | 45,504,625.96 | ||||
Total | 45,504,625.96 | 45,504,625.96 |
(2) Provision of impairment in goodwill
Unit: RMB
The invested entity or matters which formed goodwill | Balance at the Start of the Period | Increased in the current period | Decreased in the current period | Balance at the End of the Period | ||
Accrued | Disposal | |||||
Jiuzhaigou Tibetan Mystery Culture Co., Ltd | 17,425,960.27 | 16,422,870.82 | 33,848,831.09 |
Total | 17,425,960.27 | 16,422,870.82 | 33,848,831.09 |
Information about the asset group or asset group combination where the goodwill is locatedJiuzhaigou Tibetan Mystery Culture Co., Ltd:
Composition of asset group or combination of asset groups | Jiuzhaigou Tibetan Mystery Culture Co., Ltd |
Book value of the asset group or asset groups combination | 46,117,875.21 |
Original book value of goodwill | 45,504,625.96 |
Unrecognized value of goodwill attributed to equity of minority shareholders | 30,336,417.31 |
Including the value of unrecognized goodwill attributed to minority shareholders' equity | 75,841,043.27 |
The book value of the asset group or combination of asset groups that involves goodwill | 121,958,918.48 |
The present book value of the expected future cash flow of the asset group (the recoverable current book value) | 65,544,200.00 |
Accumulated impairment loss of goodwill | 33,848,831.09 |
Whether the asset group or combination of asset groups is consistent with its identified amount at the date of purchase and the goodwill impairment test of previous years | Consistency |
In 2015, the company acquired 60% of Jiuzhaigou Tibetan Mystery Culture Co., Ltd.,. whose business is single and independentfor accounting; therefore it is considered as an independent asset group.
(3) The process, method, key parameters of the goodwill impairment test and the method of confirming theloss of goodwill impairment::
The recoverable amount of the asset group is determined on the basis of the higher of the present value of the estimatedfuture operating net cash flow during the asset life or the market value (fair value) of the asset, minus the net amount of disposalexpenses and relevant taxes.
The present value of the expected future net cash flow of the asset group is based on the management budget for the next fiveyears and the adjusted discount rate. It is calculated by using the cash flow forecasting method. The cash flow beyond the five-yeardetailed forecast period is calculated with a stable growth rate. Among them, the forecast period of cash flow is 2021-2025 (thesubsequent period is perpetuity), and the discount rate is 12.79%.Other key data used in the impairment test include: operating revenue, operating costs and related expenses, capital expenditures,depreciation and amortization.
According to the "Asset Appraisal Report"(No.01-268,Beifangyapingbaozi of Year 2021) issued by Beijing Northern Asia AssetsAppraisal Firm (Special General Partnership) hired by the company, recoverable amount of the asset group involving goodwill wasRMB 65,544,200.00. After testing, the accumulated goodwill impairment of Jiuzhaigou Tibetan Mystery Culture Co., Ltd. was RMB33,848,831.09.
14. Long-term prepaid expenses
Unit: RMB
Item | Balance at the Start of the Period | Increased in the current period | Prepaid Expenses in This Period | Other Amounts Decreased | Balance at the End of the Period |
Expenditures for improvement of operating leased fixed assets | 16,194,513.36 | 102,555,642.98 | 5,014,426.73 | 113,735,729.61 | |
House decoration fee | 3,156,210.74 | 4,331,967.84 | 2,363,188.65 | 5,124,989.93 | |
Fees for road signs in scenic spots | 14,034,104.10 | 5,540,200.98 | 5,395,796.05 | 14,178,509.03 | |
Scenic animals and plants | 43,755,769.03 | 8,490,010.36 | 14,725,262.80 | 37,520,516.59 | |
Cost of creating costumes and props | 34,820,479.01 | 15,026,982.17 | 5,754,104.36 | 44,093,356.82 | |
Long-term rental fee | 479,550.78 | 109,202,325.81 | 1,035,087.58 | 108,646,789.01 | |
Others | 1,187,442.62 | 746,156.72 | 441,285.90 | ||
Total | 112,440,627.02 | 246,334,572.76 | 35,034,022.89 | 323,741,176.89 |
15. Deferred income tax assets/liabilities
(1) Deferred income tax assets not written off
Unit: RMB
Item | Balance at the End of the Period | Balance at the Start of the Period | ||
Deductible temporary difference | Deferred Income Tax Assets | Deductible temporary difference | Deferred Income Tax Assets | |
Provision for Impairment of Assets | 65,659,489.58 | 16,308,221.87 | 32,861,329.93 | 8,158,388.51 |
Unrealized Profit from Internal Transactions | 8,710,326.58 | 2,177,581.65 | 3,960,255.51 | 990,063.88 |
Total | 74,369,816.16 | 18,485,803.52 | 36,821,585.44 | 9,148,452.39 |
(2) Deferred income tax liabilities not written off
Unit: RMB
Item | Balance at the End of the Period | Balance at the Start of the Period | ||
Taxable temporary difference | Deferred Income Tax Liabilities | Taxable temporary difference | Deferred Income Tax Liabilities | |
Asset appraisal | 386,938,479.60 | 96,734,619.90 |
increment of merged assets of the entities not under common control | ||||
Changes in the fair value of other equity instrument investments | 38,442,254.88 | 9,610,563.72 | ||
Changes in the fair value of the trading financial assets included in the profit and loss from fair value changes of the current period | 182,449.34 | 34,600.28 | 4,643,937.75 | 1,160,984.46 |
Total | 387,120,928.94 | 96,769,220.18 | 43,086,192.63 | 10,771,548.18 |
(3) Details of unrecognized deferred income tax assets
Unit: RMB
Item | Balance at the End of the Period | Balance at the Start of the Period |
Deductible temporary difference | 1,044,004,655.08 | |
Deductible Losses | 359,520,530.58 | 178,326,292.21 |
Total | 1,403,525,185.66 | 178,326,292.21 |
(4) The deductible losses of unrecognized deferred income tax assets will mature in the following years
Unit: RMB
Year | Amount at the end of the period | Opening balance | Notes |
2020 | 445.00 | ||
2021 | 10,214,970.98 | 10,063,818.26 | |
2022 | 16,736,431.92 | 20,511,817.39 | |
2023 | 62,433,581.93 | 62,499,359.60 | |
2024 | 70,358,021.61 | 85,250,851.96 | |
2025 | 199,777,524.14 | ||
Total | 359,520,530.58 | 178,326,292.21 | -- |
Other notes:
The company acquired Zhuhai Southern Film and Television Culture Industry Co., Ltd. in 2020, which increased the recoverableloss of the company to RMB 3,194,995.24 by the end of 2021
16. Other non-current assets
Unit: RMB
Item | Balance at the End of the Period | Balance at the Start of the Period | ||||
Book balance | Provision for decline in value | Book value | Book balance | Provision for decline in value | Book value | |
Advance payment for project | 7,733,926.26 | 7,733,926.26 | 21,064,619.27 | 21,064,619.27 | ||
Advance payment for car | 855,900.00 | 855,900.00 | ||||
Total | 8,589,826.26 | 8,589,826.26 | 21,064,619.27 | 21,064,619.27 |
17. Accounts payable
(1) Details of accounts payable
Unit: RMB
Item | Balance at the End of the Period | Balance at the Start of the Period |
Payment for project, equipment and maintenance | 346,638,370.70 | 282,821,061.27 |
Inventory cost | 24,866,101.30 | 13,964,738.58 |
Rental fees | 1,200,000.00 | |
Advertising cost and other fees | 971,992.69 | 2,671,079.77 |
Total | 372,476,464.69 | 300,656,879.62 |
18. Advance receipts
(1) Details of received pre-payments
Unit: RMB
Item | Balance at the End of the Period | Balance at the Start of the Period |
Shop rent | 12,888,689.05 | 39,894,552.94 |
Ticket fees | ||
Planning fee, design fee, program production fee | ||
Total | 12,888,689.05 | 39,894,552.94 |
19. Contract liabilities
Unit: RMB
Item | Balance at the End of the Period | Balance at the Start of the Period |
Ticket fees | 11,352,124.25 | 10,811,921.34 |
Planning fee, design fee, program production fee | 177,198,113.27 | 283,490,566.04 |
Total | 188,550,237.52 | 294,302,487.38 |
The amount of significant change in book value during the reporting period and the reason thereof
Unit: RMB
Item | Amount of change | Reason for change |
Planning fee, design fee, program production fee | 73,584,905.66 | Increase in amount due to receipt of cash |
Planning fee, design fee, program production fee | -179,877,358.43 | The amount of reduced contract liabilities due to the carry-over income of this year |
Total | -106,292,452.77 | —— |
20、Salary payable
(1) Details of payroll payable
Unit: RMB
Item | Balance at the Start of the Period | Increased in the current period | Decreased in the current period | Balance at the End of the Period |
Ⅰ. Short-term remuneration | 26,636,404.96 | 165,085,458.36 | 172,980,522.37 | 18,741,340.95 |
Ⅱ. Dismission benefits - defined contribution scheme | 101,483.47 | 2,429,865.27 | 2,454,884.95 | 76,463.79 |
Ⅲ. Dismissal welfare | 269,784.48 | 269,784.48 | ||
Total | 26,737,888.43 | 167,785,108.11 | 175,705,191.80 | 18,817,804.74 |
(2) List of short-term remuneration
Unit: RMB
Item | Balance at the Start of the Period | Increased in the current period | Decreased in the current period | Balance at the End of the Period |
1. Wages or salaries, bonuses, allowances and | 22,890,436.83 | 141,141,123.17 | 149,644,935.62 | 14,386,624.38 |
subsidies | ||||
2. Staff welfare | 14,001,512.92 | 13,985,822.68 | 15,690.24 | |
3. Social insurance contributions | 76,842.60 | 5,179,287.92 | 5,181,381.13 | 74,749.39 |
Including: medical insurance | 66,814.36 | 4,997,487.95 | 5,004,083.36 | 60,218.95 |
Work injury insurance premium | 1,727.23 | 45,433.97 | 45,456.48 | 1,704.72 |
Birth insurance premium | 8,301.01 | 136,366.00 | 131,841.29 | 12,825.72 |
4. Housing funds | 38,191.00 | 3,405,206.80 | 3,369,015.80 | 74,382.00 |
5. Labor union and education funds | 3,630,934.53 | 1,358,327.55 | 799,367.14 | 4,189,894.94 |
Total | 26,636,404.96 | 165,085,458.36 | 172,980,522.37 | 18,741,340.95 |
(3) Defined contribution scheme (Note)
Unit: RMB
Item | Balance at the Start of the Period | Increased in the current period | Decreased in the current period | Balance at the End of the Period |
1. Basic pension insurance | 98,301.95 | 2,349,165.30 | 2,374,077.04 | 73,390.21 |
2. Unemployment insurance | 3,181.52 | 80,699.97 | 80,807.91 | 3,073.58 |
Total | 101,483.47 | 2,429,865.27 | 2,454,884.95 | 76,463.79 |
21. Taxes payable
Unit: RMB
Item | Balance at the End of the Period | Balance at the Start of the Period |
VAT | 1,627,758.21 | 1,369,684.24 |
Enterprise Income Tax | 14,538,779.22 | 11,790,054.25 |
Individual income tax | 568,739.64 | 419,317.22 |
Urban Maintenance and Construction Tax | 124,619.04 | 162,742.03 |
House property tax | 2,125,001.78 | 6,177,522.75 |
Land usage tax | 790,142.85 | 2,482,574.75 |
Education Surcharges | 69,757.11 | 117,648.61 |
Stamp duty | 25,010.64 | 94,292.11 |
Others | 335.68 | |
Total | 19,869,808.49 | 22,614,171.64 |
22. Other payables
Unit: RMB
Item | Balance at the End of the Period | Balance at the Start of the Period |
Interest Payable | ||
Dividends Payable | ||
Other Payables | 65,149,971.79 | 63,299,348.02 |
Total | 65,149,971.79 | 63,299,348.02 |
(1) Other payables
1) Other payables listed by nature of funds
Unit: RMB
Item | Balance at the End of the Period | Balance at the Start of the Period |
Merchant deposit | 4,724,228.60 | 13,413,112.55 |
Deposit of construction party | 4,130,003.70 | 4,708,367.70 |
Deposit of merchant for bidding | 1,923,628.40 | 2,518,060.00 |
Deposit of travel agency | 4,301,753.00 | 3,640,858.00 |
Other types of deposits | 1,553,964.82 | 1,663,064.43 |
Reward for over-fulfilled performance | 31,576,200.00 | 31,576,200.00 |
Incomings and outgoings | 14,094,504.75 | 3,427,348.61 |
Others | 2,845,688.52 | 2,352,336.73 |
Total | 65,149,971.79 | 63,299,348.02 |
Other explanation: The reward for over-fulfilled performance at the end of the period is determined according to the initialacquisition agreement with Beijing Huafang Technology Co., Ltd.,. If the excess part of the net profit actually realized during theperformance commitment period that is higher than the promised net profit, the excess part has not been issued to themanagement shall be calculated in accordance with the agreed proportion
23. Non-current liabilities due within one year
Unit: RMB
Item | Balance at the End of the Period | Balance at the Start of the Period |
Long-term debt due within one year | 12,000,000.00 | |
Interest on long-term loans for which the principal and interest is repaid by installments | 426,708.33 | |
Total | 12,426,708.33 |
24. Other current liabilities
Unit: RMB
Item | Balance at the End of the Period | Balance at the Start of the Period |
Output VAT to be carried forward | 3,513,902.08 | 17,536,415.96 |
Total | 3,513,902.08 | 17,536,415.96 |
25. Long-term loans
(1) Categories of long-term loans
Unit: RMB
Item | Balance at the End of the Period | Balance at the Start of the Period |
Fiduciary loans | 282,000,000.00 | |
Total | 282,000,000.00 |
26. Deferred revenue
Unit: RMB
Item | Balance at the Start of the Period | Increased in the current period | Decreased in the current period | Balance at the End of the Period | Causes |
Government subsidies | 382,872,318.90 | 5,373,300.00 | 625,758.49 | 387,619,860.41 | Government's grant |
Total | 382,872,318.90 | 5,373,300.00 | 625,758.49 | 387,619,860.41 | -- |
Projects related to government subsidies:
Unit: RMB
Liabilities | Balance at the Start of the Period | The amount of new subsidies in this period | Amount recorded as non-operating revenue in this period | The Amount Recorded as Other Income in This Period | The Amount Written off Costs in This Period | Other variations | Balance at the End of the Period | Related to assets/related to income |
In 2008, the discounts on interest for the international animation gallery project were received. | 3,333,332.38 | 142,857.24 | 3,190,475.14 | Related to assets | ||||
In 2017, the cultural and creative funds for "Love Song of Lijiang" project were received. | 346,666.28 | 20,000.04 | 326,666.24 | Related to assets | ||||
In 2017, the grant for the toilet project of the modern service industry in Songcheng Scenic Area were received. | 114,833.56 | 6,500.04 | 108,333.52 | Related to assets | ||||
In 2017, Hangzhou modern service industry guiding funds for the cable car project were received. | 537,800.00 | 13,445.00 | 524,355.00 | Related to assets | ||||
In 2017, the special funds of tourism planning and construction of modern service for Xianghu Lake Romance were received. | 903,586.61 | 52,130.04 | 851,456.57 | Related to assets | ||||
In 2017, the special funds for cultural industry development were received. | 2,000,000.00 | 58,333.31 | 1,941,666.69 | Related to assets | ||||
In 2018, the special funds for cultural | 500,000.00 | 500,000.00 | Related to assets |
industry development were received from the Department of Culture, Radio, Television, Press, Publication and Sports of Hainan province. | ||||||||
In 2018, the subsidies for Longquan Mountain ecological rehabilitation project were received. | 922,833.36 | 48,999.96 | 873,833.40 | Related to assets | ||||
In 2018, the subsidies for Guilin Lijiang Romance fork culture, leisure tourism and performance project were received. | 462,500.04 | 24,999.96 | 437,500.08 | Related to income | ||||
In 2019, the special funds for planning and construction subsidies of modern service industry issued by the Municipal Tourism Commission for the reconstruction project of No. 2 Theater Complex in Songcheng Romance Park were received. | 1,626,433.34 | 66,159.96 | 1,560,273.38 | Related to assets | ||||
In 2019, Hangzhou modern service industry tourism | 199,333.33 | 8,000.03 | 191,333.30 | Related to income |
special funds for the construction project of the new entrance hall washroom were received. | ||||||||
In 2019, the guiding funds of Guilin Lijiang service industry for Guilin Romance folk culture leisure tourism performance project were received. | 1,425,000.00 | 75,000.00 | 1,350,000.00 | Related to assets | ||||
In 2019, special funds issued by Xiqiao Mountain Scenic Area Management Committee in Nanhai District, Foshan for supporting the project of Foshan Xiqiao Mountain Romance park were received. | 370,000,000.00 | 370,000,000.00 | Related to assets | |||||
In 2019, the cultural and tourism industry funds issued by Hainan Provincial Department of Finance for Sanya No. 2 theater project were received. | 500,000.00 | 500,000.00 | Related to assets | |||||
In 2020, the financial support funds issued by Shanghai | 280,000.00 | 280,000.00 | Related to assets |
government for promoting the development of cultural and creative industries were received. | ||||||||
In 2020, the cultural industry development special funds issued by Hainan Provincial Department of Finance for Sanya No.2 Theater Project were received. | 2,000,000.00 | 2,000,000.00 | Related to income | |||||
In 2020, the special funds for development of modern service industry issued by Development and Reform Bureau of Wulingyuan District of Zhangjiajie were received. | 2,000,000.00 | 83,330.00 | 1,916,670.00 | Related to assets | ||||
In 2020, the special funds for tourism development issued by Zhangjiajie Municipal Finance Bureau were received. | 423,400.00 | 21,170.00 | 402,230.00 | Related to assets | ||||
In 2020, Hangzhou modern service industry tourism special funds allocated by Hangzhou Culture, Radio, Film and | 490,000.00 | 4,083.33 | 485,916.67 | Related to income |
Television Tourism Bureau for significant leisure tourism construction, the upgrading and renovation of scenic spots, and tourism planning projects were received. | ||||||||
In 2020, the special tourism (tourism toilet) subsidies allocated by Hangzhou Culture, Radio, Film and Television Tourism Bureau were received. | 179,900.00 | 749.58 | 179,150.42 | Related to assets | ||||
Total | 382,872,318.90 | 5,373,300.00 | 625,758.49 | 387,619,860.41 |
27. Share capital
Unit: RMB
Balance at the Start of the Period | Increased or decreased amount in this period (+/-) | Balance at the End of the Period | |||||
Shares newly issued | Bonus shares | Shares converted from capital reserves | Others | Subtotal | |||
Total shares | 1,452,607,800.00 | 1,162,086,240.00 | 1,162,086,240.00 | 2,614,694,040.00 |
Other notes:
(1) Transfer of capital reserves: The equity distribution plan was reviewed and approved at the Annual General Meeting ofShareholders of Year 2019 held on 18 May,2020. Based on the total capital of 1,452,607,800 shares at the end of 2019, thecompany transferred 8 additional shares for every 10 shares from the capital reserve to all shareholders. Total of 1,162,086,240additional shares were added. The total share capital after transfer was 2,614,694,040 shares.
(2) Other changes: the conversion between restricted shares and unrestricted shares. Among them, according to the"Implementation Rules for Shareholders, Directors, Supervisors, Top Management Personnel of Listed Companies of ShenzhenStock Exchange", in 2020, the restricted shares held by the secretary of board Dong Xin and former director Liu Yan was lifted and38,830,789 shares of restricted shares were converted. Liu Ping added 459,827 restricted shares due to changes in securityaccount.
28. Capital reserves
Unit: RMB
Item | Balance at the Start of the Period | Increased in the current period | Decreased in the current period | Balance at the End of the Period |
Capital premium (capital share premium) | 2,467,285,269.09 | 1,197,545,567.38 | 1,269,739,701.71 | |
Other capital reserves | 9,026,800.00 | 29,989,479.82 | 97,391,766.67 | -58,375,486.85 |
Among them: (1) Amount of share-based payment included in owner’s equity | 8,676,800.00 | 8,676,800.00 | ||
(2) Other | 350,000.00 | 350,000.00 | ||
(3) Other changes in owner‘s equity other than net profit and loss of the invested entity | 29,989,479.82 | 97,391,766.67 | -67,402,286.85 | |
Total | 2,476,312,069.09 | 29,989,479.82 | 1,294,937,334.05 | 1,211,364,214.86 |
Other notes, including increases or decreases in this period and their reasons:
(1) Description of changes in capital premium (share premium):
1).The annual equity distribution plan was reviewed and approved in Annual General Meeting of Shareholders of Year 2019held on 18 May, 2020. based on the total capital of 1,452,607,800 shares at the end of Year 2019, the company transferred 8additional shares for every 10 shares from the capital reserve to all shareholders. Total reduction of capital reserve-capital premiumwas RMB 1,162,086,240 .The company acquired 20% minority shareholders' interests of its subsidiary Aba Zhou Jiuzhai Romance Tourism DevelopmentCo., Ltd.,. The shareholding ratio rose from 80% to 100%. The difference between the newly acquired long-term equity investmentas a result of purchase of minority equity and the net assets based on new shareholding ratio that should be continuouslycalculated by the subsidiary since the purchase date was RMB -35,459,327.38. The capital reserve-capital premium was reduced byRMB 35,459,327.38.
(2) Other changes in owner‘s equity other than net profit and loss of the invested entity
1). In November 2020, Beijing Huafang Technology co., ltd. (formerly known as Beijing Six Rooms Technology co., ltd.)increased its registered capital from RMB 5,000 ten thousand to RMB 5,333.33 ten thousand , and the investment of the companyin Beijing Huafang Technology co., ltd. was passively diluted from 39.53% to 37.06%. Using equity method for accounting, thecompany recognizes the long-term equity corresponding to the increase in net assets of Beijing Huafang Technology co., ltd. due toits capital increase and share expansion. In addition, the decrease in the shareholding ratio should be carried forward according tothe new shareholding ratio. The difference of RMB -97,391,766.67 between the book value of the corresponding long-term equityinvestment was recognized in capital reserve.In the current period, the book value of long-term equity investment was adjusted to RMB 29,989,479.82 due to the changesin owner‘s equity other than net profit and loss of the invested unit Beijing Huafang Technology Co., ltd.
29. Other comprehensive incomes
Unit: RMB
Item | Balance at the Start of the Period | This Period's Amount of Occurrence | Balance at the End of the Period | |||||
Before tax balance in this period | Less: recorded into other comprehensive incomes in previous period and transferred to P/L in current period | Less: Recorded into other comprehensive incomes in previous period and transferred to retained income in current period | Less: Income Tax Expense | Attributable to the Company after tax | Attributable to the minority shareholders after tax | |||
1. Other comprehensive income that cannot be reclassified into profit and loss | 17,490,719.49 | -76,693,334.90 | -1,356,586.59 | -9,610,563.72 | -65,726,184.59 | -48,235,465.10 | ||
Other comprehensive income that cannot be transferred to profit or loss under the equity method | -1,356,586.59 | -1,356,586.59 | 1,356,586.59 | |||||
Changes in the fair value of other equity instrument investments | 18,847,306.08 | -76,693,334.90 | -9,610,563.72 | -67,082,771.18 | -48,235,465.10 | |||
II. Other comprehensive income that will be reclassified into P/L | -26,171,871.08 | 11,082,806.63 | 11,082,220.43 | 586.20 | -15,089,650.65 | |||
Currency conversion difference | -26,171,871.08 | 11,082,806.63 | 11,082,220.43 | 586.20 | -15,089,650.65 | |||
Other comprehensive incomes in total | -8,681,151.59 | -65,610,528.27 | -1,356,586.59 | -9,610,563.72 | -54,643,964.16 | 586.20 | -63,325,115.75 |
30. Surplus reserve
Unit: RMB
Item | Balance at the Start of the Period | Increased in the current period | Decreased in the current period | Balance at the End of the Period |
Statutory surplus reserve | 517,673,268.35 | 517,673,268.35 |
Total | 517,673,268.35 | 517,673,268.35 |
31. Undistributed profits
Unit: RMB
Item | Current period | Previous Period |
Undistributed Profit before Adjustment at the End of Previous Period | 5,176,157,180.79 | 4,170,577,596.34 |
Adjust the total undistributed profits at the start of the period (increase +, decrease -) | 3,653,579.35 | |
Undistributed Profit after Adjustment at the Start of the Period | 5,176,157,180.79 | 4,174,231,175.69 |
Add: net profit attributable to parent company's owner in current period | -1,752,398,009.60 | 1,339,790,994.94 |
Other Carry-forward Retained Earnings of the Comprehensive Income | -1,356,586.59 | 3,336,493.95 |
Less: withdrawal for statutory surplus reserve | 166,888,547.79 | |
Payable dividends on ordinary shares | 290,521,560.00 | 174,312,936.00 |
Undistributed Profit at the End of the Period | 3,131,881,024.60 | 5,176,157,180.79 |
1). Due to the retrospective adjustment according to the "Accounting Standards for Business Enterprises" and related newregulations, affected undistributed profit at the beginning of the period was RMB 0.00.
2). Due to changes in accounting policies, affected undistributed profit at the beginning of the period was RMB 0.00.
3). Due to the correction of major accounting errors, affected undistributed profit at the beginning of the period was RMB 0.00.
4) Due to changes in the scope of consolidation under same control, affected undistributed profit at the beginning of the period wasRMB 0.00.
5). Due to Other adjustments, affected undistributed profit at the beginning of the period was RMB 0.00.
32. Operating income and operating costs
Unit: RMB
Item | This Period's Amount of Occurrence | Previous Period's Amount of Occurrence | ||
Income | Cost | Income | Cost | |
Main Business | 860,109,435.13 | 350,061,394.54 | 2,473,465,265.61 | 744,700,816.40 |
Other businesses | 42,476,690.50 | 2,609,078.88 | 138,287,943.25 | 2,488,484.84 |
Total | 902,586,125.63 | 352,670,473.42 | 2,611,753,208.86 | 747,189,301.24 |
Whether the lower of the audited net profit before and after deduction of non-recurring gains and losses is negative
√ Yes □ No
Unit: RMB
Item | 2020 | 2019 | Notes |
Operating income | 902,586,125.63 | / | Total Operating Income |
Deduction items of operating revenue | 6,381,032.95 | / | Income from personnel dispatch management and other miscellaneous businesses |
Including: | |||
Management fee business revenue | 3,519,339.62 | / | Revenue from personnel dispatch management fee |
Others | 2,861,693.33 | / | Other sporadic business income |
Subtotal of business income not related to main business | 6,381,032.95 | / | Income from personnel dispatch management and other miscellaneous businesses |
Subtotal of non-business revenue | 0.00 | / | N/A |
Amount of operating revenue after deduction | 896,205,092.68 | / | Operating income of main business |
Related information of revenue:
Unit: RMB
Contract classification | Culture and art industry-live performance | Tourism service industry | Other businesses | Total |
Product types | 636,915,514.47 | 223,193,920.66 | 42,476,690.50 | 902,586,125.63 |
Including: | ||||
(1) Hangzhou Songcheng Tourist Area | 265,487,381.20 | 265,487,381.20 | ||
(2) Sanya Songcheng Tourist Area | 118,683,102.20 | 118,683,102.20 | ||
(3) Lijiang Songcheng Tourist Area | 132,544,773.13 | 132,544,773.13 | ||
(4) Jiuzhai Songcheng Tourist Area | 25,197,742.08 | 25,197,742.08 | ||
(5) Guilin Songcheng Tourist Area | 53,799,653.29 | 53,799,653.29 | ||
(6) Zhangjiajie Songcheng Tourist Area | 16,480,189.00 | 16,480,189.00 | ||
(7) Xi'an Songcheng Tourist | 24,722,673.57 | 24,722,673.57 |
Area | ||||
(8) E-business handling fee | 43,316,562.23 | 43,316,562.23 | ||
(9) Design planning fee | 179,877,358.43 | 179,877,358.43 | ||
(10) Management fee business | 3,519,339.62 | 3,519,339.62 | ||
(11) Leasing business of scenic spots | 36,095,657.55 | 36,095,657.55 | ||
(12) Other | 2,861,693.33 | 2,861,693.33 | ||
Contract type | 636,915,514.47 | 223,193,920.66 | 42,476,690.50 | 902,586,125.63 |
Including: | ||||
(1) Revenue from contract | 636,915,514.47 | 223,193,920.66 | 6,381,032.95 | 866,490,468.08 |
Classified by the time of commodity transfer | 636,915,514.47 | 223,193,920.66 | 6,381,032.95 | 866,490,468.08 |
Including: | ||||
Confirm at time points | 636,357,477.47 | 43,316,562.23 | 835,167.32 | 680,509,207.02 |
Confirm within a certain period of time | 558,037.00 | 179,877,358.43 | 5,545,865.63 | 185,981,261.06 |
(2) Rental income | 36,095,657.55 | 36,095,657.55 |
Information related to performance obligations:
N/AInformation related to the transaction price allocated to the remaining obligations:
At the end of the reporting period, the amount of revenue corresponding to the performance obligations that have beensigned but not yet performed or not yet completed is RMB 177,198,113.27 , of which RMB 177,198,113.27 is expected to berecognized as revenue in 2021-2025.
33. Taxes and surcharges
Unit: RMB
Item | This Period's Amount of Occurrence | Previous Period's Amount of Occurrence |
Urban Maintenance and Construction Tax | 944,001.17 | 5,780,053.12 |
Education Surcharges | 827,724.98 | 4,379,199.98 |
House property tax | 7,447,753.53 | 16,889,492.45 |
Land usage tax | 1,928,223.64 | 5,159,854.16 |
Vehicle and vessel use tax | 49,250.44 | 44,089.37 |
Stamp duty | 709,855.81 | 3,844,271.82 |
Water conservancy construction fund | 26,687.48 | 67,827.55 |
Total | 11,933,497.05 | 36,164,788.45 |
34. Sales expenses
Unit: RMB
Item | This Period's Amount of Occurrence | Previous Period's Amount of Occurrence |
Sales of agent | 39,452,375.76 | |
Advertising cost | 45,899,163.03 | 81,882,054.48 |
Salary and labor fees | 9,262,823.51 | 13,194,734.22 |
Rental fees | 1,546,072.36 | 3,394,295.48 |
Fees for technical services | 878,308.35 | 2,088,909.13 |
Material consumption | 2,451,944.75 | 1,951,887.84 |
Traveling expense | 976,777.55 | 1,007,577.13 |
Others | 2,634,660.75 | 2,531,802.60 |
Total | 63,649,750.30 | 145,503,636.64 |
35. Management expenses
Unit: RMB
Item | This Period's Amount of Occurrence | Previous Period's Amount of Occurrence |
Salary and labor fees | 75,408,829.46 | 65,258,783.45 |
Amortization of intangible assets and other assets | 64,348,021.07 | 41,918,863.26 |
Consulting fee | 8,182,473.68 | 8,355,212.52 |
Traveling expense | 5,624,695.71 | 8,034,072.39 |
Depreciation charge | 75,830,364.58 | 17,052,355.49 |
Business entertainment expense | 10,034,078.60 | 9,854,115.36 |
Rental fees | 5,086,107.77 | 7,710,352.14 |
Material consumption | 9,364,375.32 | 7,365,101.12 |
Office expense | 5,579,245.84 | 4,200,718.37 |
Trademark royalty | 9,433,962.00 | 9,571,349.95 |
Afforestation fee | 2,321,906.68 | |
Maintenance cost | 3,541,464.14 | 2,237,261.26 |
Others | 13,328,642.89 | 6,656,935.92 |
Total | 288,084,167.74 | 188,215,121.23 |
Other notes:
Due to the impact of the "COVID-19" in 2020, the scenic spots of the company were closed from January 24, 2020 to June 11,
2020. During the closure period, the amount that should have been recognized in operating costs was included in managementexpenses.
36. R&D expenses
Unit: RMB
Item | This Period's Amount of Occurrence | Previous Period's Amount of Occurrence |
Salary and labor fees | 21,062,406.05 | 31,117,911.36 |
Fees for technical services | 324,329.47 | 2,273,176.07 |
Design fee | 215,813.33 | 505,299.96 |
Rental fees | 617,847.90 | 1,520,774.62 |
Amortization of intangible assets and other assets | 314,907.89 | 704,290.03 |
Traveling expense | 589,458.88 | 2,581,588.90 |
Office expense | 698,738.20 | 997,614.76 |
Depreciation charge | 7,404,031.20 | 3,988,986.72 |
Material consumption | 5,295,522.43 | 2,541,649.23 |
Others | 964,908.65 | 2,193,228.89 |
Total | 37,487,964.00 | 48,424,520.54 |
37. Financial expenses
Unit: RMB
Item | This Period's Amount of Occurrence | Previous Period's Amount of Occurrence |
Interest expense | 7,822,986.14 | |
Less: interest income | 32,572,127.48 | 22,648,412.21 |
P/L on foreign exchange | 9,952,753.34 | 20,658.20 |
Others | 1,952,949.85 | 4,883,855.17 |
Total | -12,843,438.15 | -17,743,898.84 |
38. Other incomes
Unit: RMB
Sources of other incomes | This Period's Amount of Occurrence | Previous Period's Amount of Occurrence |
Government subsidies | 34,307,513.06 | 3,561,650.56 |
Input VAT (plus credit) deduction | 264,647.17 | 723,573.63 |
Total | 34,572,160.23 | 4,285,224.19 |
Government subsidies included in other income:
Subsidy items | Amount of this period | Amount of Previous Period | Related to assets/related to income |
1. Government subsidies directly confirmed in this period | 33,681,754.57 | 1,885,679.93 | |
Unemployment insurance supports subsidies for enterprises to stabilize jobs | 1,447,638.48 | Related to income | |
Financial support funds | 14,000,000.00 | 811,400.00 | Related to income |
Enterprise practical training and social insurance subsidies | 510,905.87 | 1,050,250.93 | Related to income |
Return of service charge for individual income tax collection | 312,209.68 | 24,029.00 | Related to income |
Epidemic subsidy | 16,858,300.00 | Related to income | |
Others | 552,700.54 | Related to income | |
2. Government subsidies transferred from deferred income | 625,758.49 | 1,675,970.63 | |
Discount interest for engineering project of international animation museum | 142,857.24 | 142,857.24 | Related to assets |
Cultural and creative funds for "Lijiang Love Song" project | 20,000.04 | 20,000.04 | Related to assets |
Modern service industry funds for toilet project of Songcheng scenic area | 6,500.04 | 6,500.04 | Related to assets |
Modern service industry special funds for tourism planning and construction of Xianghu Romance Show | 52,130.04 | 52,130.04 | Related to assets |
"The Phantom of the Ancient Tree" and the reconstruction of flower lane food street | 1,277,250.01 | Related to assets | |
Subsidies for Longquan mountain ecological rehabilitation project | 48,999.96 | 48,999.97 | Related to assets |
Subsidies for Guilin Lijiang Romance, folk culture, leisure tourism and performance | 24,999.96 | 24,999.96 | Related to assets |
Subsidy items | Amount of this period | Amount of Previous Period | Related to assets/related to income |
Special funds for planning and construction of modern service industry municipal issued by Tourism Commission for the reconstruction project of No. 2 Theater Complex in Songcheng Romance Park | 66,159.96 | 27,566.66 | Related to assets |
Special funds of Hangzhou modern service industry tourism for construction of new entrance hall washroom | 8,000.03 | 666.67 | Related to assets |
The guiding funds of Guilin Lijiang service industry for Guilin Romance folk culture leisure tourism performance project | 75,000.00 | 75,000.00 | Related to assets |
Hangzhou modern service industry guiding funds for the cable car project | 13,445.00 | Related to assets | |
The special funds for development of modern service industry issued by Development and Reform Bureau of Wulingyuan District of Zhangjiajie | 83,330.00 | Related to assets | |
The special funds for tourism development issued by Zhangjiajie Municipal Finance Bureau | 21,170.00 | Related to assets | |
Hangzhou modern service industry tourism special funds issued by Hangzhou Culture, Radio, Film and Television Tourism Bureau for major leisure tourism construction, the upgrading and renovation of scenic spots, and tourism planning projects | 4,083.33 | Related to assets | |
The special subsidies for tourism (tourism toilet) | 749.58 | Related to assets | |
Jiuzhai cultural industry development special funds | 58,333.31 | Related to assets | |
Total | 34,307,513.06 | 3,561,650.56 |
39. Investment income
Unit: RMB
Item | This Period's Amount of Occurrence | Previous Period's Amount of Occurrence |
Long-term equity investment income measured by equity method | -5,356,968.22 | 72,523,327.47 |
Investment income from disposal of long-term equity investment | -27,274.40 | |
Investment income from disposal of trading financial assets | 19,371,860.52 | 51,069,524.28 |
After losing control, the remaining equity is re-measured at fair value | 149,600,667.33 | |
Total | 14,014,892.30 | 273,166,244.68 |
40. Income from changes in fair value
Unit: RMB
Source of the income from changes in fair value | This Period's Amount of Occurrence | Previous Period's Amount of Occurrence |
Trading Financial Assets | 247,726.31 | 991,859.52 |
Total | 247,726.31 | 991,859.52 |
41. Credit impairment loss
Unit: RMB
Item | This Period's Amount of Occurrence | Previous Period's Amount of Occurrence |
Bad debt losses of other receivables | -32,551,183.69 | -933,666.76 |
Bad debt losses of accounts receivable | -188,793.22 | 2,259,651.28 |
Total | -32,739,976.91 | 1,325,984.52 |
42. Asset impairment loss
Unit: RMB
Item | This Period's Amount of Occurrence | Previous Period's Amount of Occurrence |
Long-term equity investment impairment loss | -1,861,297,284.90 | |
Goodwill impairment loss | -16,422,870.82 | -17,425,960.27 |
Total | -1,877,720,155.72 | -17,425,960.27 |
43. Income from asset disposal
Unit: RMB
Sources of the asset disposal income | This Period's Amount of Occurrence | Previous Period's Amount of Occurrence |
Total gains from disposal of non-current assets | 676,435.92 | -767,848.08 |
Of which: gains from disposal of fixed assets | 676,435.92 | -83,042.30 |
Gains from disposal of intangible assets | ||
Other long-term asset disposal gains | -684,805.78 | |
Total | 676,435.92 | -767,848.08 |
44. Non-operating income
Unit: RMB
Item | This Period's Amount of Occurrence | Previous Period's Amount of Occurrence | Amount recorded into non-recurring profit and loss in current period |
Government subsidies | 1,046,433.96 | 1,344,754.19 | 1,046,433.96 |
Liquidated damages, fine income | 1,302,066.30 | 1,123,750.98 | 1,302,066.30 |
Waste disposal income | 466,299.22 | 327,092.18 | 466,299.22 |
Accounts payable that cannot be paid | 10,120.52 | 518,932.83 | 10,120.52 |
Others | 417,457.14 | 2,683,307.85 | 417,457.14 |
Total | 3,242,377.14 | 5,997,838.03 | 3,242,377.14 |
Government subsidies recorded into current period P/L:
Unit: RMB
Subsidy items | Distributing Entity | Distributing Reason | Types of Nature | Subsidies Influence Profit and Loss in the Current Year or not | Special Subsidy or not | This period's amount of occurrence | Previous period's amount of occurrence | Related to assets/related to income |
Subsidies for stable positions | 181,704.19 | Related to income | ||||||
Four-Star Meritorious | 1,000,000.00 | Related to income |
Enterprise Support Funds of Year 2018 | ||||||||
The cultural and creative funds | 30,000.00 | Related to income | ||||||
Subsidies for "Creating a National Civilized City" | 50,000.00 | Related to income | ||||||
Incentives for new enterprises above designated size | 240,000.00 | 50,000.00 | Related to income | |||||
The special reward funds issued by Ningxiang Development and Reform Bureau for service industry | 10,000.00 | Related to income | ||||||
The special reward funds for Xiqiao Mountain cultural tourism “Eagle" plan | 10,000.00 | Related to income | ||||||
The special support funds for tourism development | 100,000.00 | Related to income | ||||||
Award for investment promotion | 100,000.00 | Related to income | ||||||
Subsidies for | 300,000.00 | Related to |
cultural industry | income | |||||||
Others | 306,433.96 | 13,050.00 | Related to income | |||||
Total | 1,046,433.96 | 1,344,754.19 |
45. Non-operating expenses
Unit: RMB
Item | This Period's Amount of Occurrence | Previous Period's Amount of Occurrence | Amount recorded into non-recurring profit and loss in current period |
Loss from damage and destruction of non-current assets | 38,302,318.05 | 77,834,592.21 | 38,302,318.05 |
Public welfare donations | 300,000.00 | 12,000,000.00 | 300,000.00 |
Non-public welfare donations | 93,000.00 | 602,450.00 | 93,000.00 |
Compensation expenditure | 2,020,885.17 | 5,002,395.18 | 2,020,885.17 |
Others | 291,676.21 | 6,077,566.51 | 291,676.21 |
Total | 41,007,879.43 | 101,517,003.90 | 41,007,879.43 |
46. Income tax expenses
(1) Income tax expenses table
Unit: RMB
Item | This Period's Amount of Occurrence | Previous Period's Amount of Occurrence |
Current income tax expense | 42,291,502.79 | 265,749,412.31 |
Deferred income tax expense | -12,456,333.68 | -596,845.22 |
Total | 29,835,169.11 | 265,152,567.09 |
(2) Reconciliation of accounting profits and income tax expenses
Unit: RMB
Item | This Period's Amount of Occurrence |
Total Profit | -1,737,110,708.89 |
Income tax expense calculated at statutory/applicable tax rate | -434,277,677.22 |
Impact by applying different tax rates to subsidiaries | -38,596,484.69 |
Impact of income tax before adjustment in this period | 6,660,254.34 |
Impact of non-taxable income | -501,619.10 |
Impact of the non-deductible costs, expenses and losses | 194,030,661.96 |
The effect of using deductible losses of deferred income tax assets that have not been recognized in the previous period | -1,281,397.39 |
The effect of unrecognized deductible temporary differences of deferred income tax assets or unrecognized deductible losses in the current period | 303,801,431.21 |
Income tax expense | 29,835,169.11 |
47. Other comprehensive income
For details, please refer to Note 7 (29) Other Comprehensive Income.
48. Items of Cash Flow Statement
(1) Other cash receipts relating to operating activities
Unit: RMB
Item | This Period's Amount of Occurrence | Previous Period's Amount of Occurrence |
Interest Income | 35,986,922.00 | 19,233,617.69 |
Non-operating Revenue | 2,185,822.66 | 4,134,151.01 |
Government financial subsidies | 40,101,488.53 | 377,084,434.12 |
Receipt of current account | 25,497,842.41 | 79,204,201.30 |
Total | 103,772,075.60 | 479,656,404.12 |
(2) Other cash payments relating to operating activities
Unit: RMB
Item | This Period's Amount of Occurrence | Previous Period's Amount of Occurrence |
Expenses | 133,608,090.57 | 213,101,617.02 |
Non-Operating Expenses | 2,705,561.38 | 18,894,676.91 |
Payment of current account | 20,821,514.98 | 99,074,449.48 |
Total | 157,135,166.93 | 331,070,743.41 |
(3) Other cash paid in connection with investment activities
Unit: RMB
Item | This Period's Amount of Occurrence | Previous Period's Amount of Occurrence |
Cash brought out from decrease of consolidated scope in the current period | 345,075,573.87 | |
Total | 345,075,573.87 |
49. Supplementary information about Cash Flow Statement
(1) Supplementary information about the Cash Flow Statement
Unit: RMB
Supplementary information | Amount of this period | Amount of Previous Period |
1. Reconciliation of net profit to cash flows from operational activities: | -- | -- |
Net Profit | -1,766,945,878.00 | 1,364,903,511.20 |
Add: provision for impairment of assets | 1,910,460,132.63 | 16,099,975.75 |
Depreciation of fixed assets, oil and gas assets, productive biological assets | 201,385,250.67 | 183,251,114.66 |
Depreciation of right-of-use assets | ||
Amortization of Intangible Assets | 56,669,812.67 | 44,633,069.92 |
Amortization of long-term prepaid expenses | 35,034,022.89 | 28,611,261.50 |
Losses on disposal of fixed assets, intangible assets and other long-term assets (mark "-" for incomes) | -676,435.92 | 767,848.08 |
Losses on scrapping of fixed assets (mark "-" for incomes) | 38,302,318.05 | 77,834,592.21 |
Losses on fair value changes (mark "-" for incomes) | -247,726.31 | -991,859.52 |
Financial expenses (mark "-" for incomes) | 17,775,739.48 | 20,658.20 |
Losses on investment (mark "-" for incomes) | -14,014,892.30 | -273,166,244.68 |
Decrease on deferred income tax assets (mark "-" for increases) | -9,318,905.44 | -525,776.05 |
Increase on deferred income tax liabilities (mark "-" for decreases) | -3,137,428.24 | -71,069.17 |
Decrease on inventories (mark "-" for increases) | -1,993,817.28 | -2,841,747.50 |
Decrease on operational | -44,275,900.28 | -10,269,859.84 |
receivables (mark "-" for increases) | ||
Increase on operational payables (mark "-" for decreases) | -25,074,392.68 | 143,196,024.75 |
Others | ||
Net cash flow generated by operating activities | 393,941,899.94 | 1,571,451,499.51 |
2. Major investing and financing activities not involving cash receipts and payment: | -- | -- |
Conversion of debt into capital | ||
Convertible corporate bonds due within one year | ||
Fixed assets under financing lease | ||
3. Net changes in cash and cash equivalents: | -- | -- |
Closing balance of cash | 1,337,776,253.98 | 1,781,710,027.35 |
Less: opening balance of cash | 1,781,710,027.35 | 1,549,948,352.47 |
Add: closing balance of cash equivalents | ||
Less: opening balance of cash equivalents | ||
Net additions to balance of equivalents | -443,933,773.37 | 231,761,674.88 |
(2) Net cash payments for acquisition of subsidiaries in this period
Unit: RMB
Amount | |
Cash or cash equivalents used for the acquisition occurred in this period and paid in this period | 378,000,000.00 |
Including: | -- |
Zhuhai Southern Film and Television Cultural Industry Co., Ltd. | 378,000,000.00 |
Less: cash and cash equivalents held by acquired subsidiaries | 232,493.05 |
Including: | -- |
Zhuhai Southern Film and Television Cultural Industry Co., Ltd. | 232,493.05 |
Including: | -- |
Net cash paid for acquisition of subsidiaries | 377,767,506.95 |
(3) Composition of cash and cash equivalents
Unit: RMB
Item | Balance at the End of the Period | Balance at the Start of the Period |
Ⅰ. Cash | 1,337,776,253.98 | 1,781,710,027.35 |
Including: cash on hand | 2,437,262.81 | 2,237,068.96 |
Bank deposit for payment at any time | 1,285,458,896.93 | 1,777,193,843.97 |
Other cash and bank balances for payment at any time | 49,880,094.24 | 2,279,114.42 |
Ⅲ. Closing balance of cash and cash equivalents | 1,337,776,253.98 | 1,781,710,027.35 |
50. Monetary items in foreign currencies
(1) Monetary items in foreign currencies
Unit: RMB
Item | Closing balance in foreign currencies | Exchange rate for conversion | Closing Balance Converted into RMB |
Cash and Bank Balances | -- | -- | 116,361,440.06 |
Including: USD | 16,297,538.73 | 6.52490 | 106,339,810.45 |
EUR | |||
HKD | 2,990,481.28 | 0.84164 | 2,516,908.66 |
AUD | 1,330,254.69 | 5.01630 | 6,672,956.60 |
THB | 3,817,534.18 | 0.21788 | 831,764.35 |
(2) Notes on overseas business entities, including that for the important overseas business entities, theoverseas main premises, functional currency and selection basis shall be disclosed. If there are changes on itsfunctional currency, the causes for the changes shall be disclosed as well.
√ Applicable □ Not applicable
The overseas operating entities of the company include Songcheng Performance International Development Co., Ltd.,Songcheng (Australia) Entertainment Pty Ltd., Songcheng (Australia) Entertainment Pty Ltd.., Songcheng Holdings (Thailand) Co., Ltd.and Songcheng (Pattaya) International Culture Co., Ltd. The operating place respectively in Hong Kong, China, Queensland, Australia,Bangkok, Thailand, and Pattaya, Thailand. The standard currency for bookkeeping is Hong Kong dollars, Australian dollars and Thaibaht by considering the needs of local business development.
51. Government grants
(1) Basic information about government subsidies
Unit: RMB
Types | Amount | Items reported | Amount taken to current P&L |
Government subsidies related to daily operating activities | 5,373,300.00 | Deferred Income | 625,758.49 |
Government subsidies related to daily operating activities | 33,681,754.57 | Other Incomes | 33,681,754.57 |
Government subsidies unrelated to daily operating activities | 1,046,433.96 | Non-operating Revenue | 1,046,433.96 |
VIII. Changes in the Scope of Consolidation
1. Consolidation not under the common control
(1) Consolidation not under the common control in this period
Unit: RMB
Name of Acquiree | Time Point for Equity Acquisition | Cost for Equity Acquisition | Percentage Acquired | Acquisition Method | Acquisition Date | Basis for Determining Acquisition Date | Income of Acquired Party from the Acquisition Date to the End of the Period | Net Profit of Acquired Party from the Acquisition Date to the End of the Period |
Zhuhai Southern Film and Television Cultural Industry Co., Ltd. | April 26, 2020 | 378,000,000.00 | 100.00% | Acquisition in cash | April 26, 2020 | Complete the industrial and commercial changes and the payment is completed | -16,469,469.80 |
(2) Consolidation costs and goodwill
Unit: RMB
Consolidated Cost | Zhuhai Southern Film and Television Cultural Industry Co., Ltd. |
-- Cash | 378,000,000.00 |
Total cost of business combination | 378,000,000.00 |
Less: fair value of identifiable net assets acquired | 378,000,000.00 |
Other notes:
In this period, the company acquired 100% equity of Zhuhai South Film& Television Culture Industry Co., Ltd. According to the"Asset Appraisal Report"(No.311,ZGXpingbaozi of Year 2019) issued by Guangdong ZGX Assets Appraisal Co., LTD, the transactionprice after negotiation was RMB 378 million. After the acquisition, the company holds 100% of the equity of Zhuhai South Film&Television Culture Industry Co., Ltd. Zhuhai Southern Film& Television Cultural Industry Co., Ltd. has a subsidiary, Zhuhai HuayinLandscaping Co., Ltd., with 55% of its shares
(3) Identifiable assets and liabilities of acquired party at the acquisition date
Unit: RMB
Zhuhai Southern Film and Television Cultural Industry Co., Ltd. | ||
Fair Value at Acquisition Date | Book Value at Acquisition Date | |
Assets: | 501,274,360.46 | 103,544,459.10 |
Cash and Bank Balances | 232,493.05 | 232,493.05 |
Inventory | 5,320,107.66 | 5,320,107.66 |
Fixed Assets | 1,020,592.33 | 1,020,592.33 |
Intangible Assets | 428,028,880.81 | 30,298,979.45 |
Other Receivables | 2,353,177.16 | 2,353,177.16 |
Projects under Construction | 64,080,763.76 | 64,080,763.76 |
Other long-term assets | 238,345.69 | 238,345.69 |
Liabilities: | 124,035,829.79 | 25,290,165.83 |
Payables | 25,235,805.73 | 25,235,805.73 |
Other liabilities | 98,800,024.06 | 54,360.10 |
Net Assets | 377,238,530.67 | 78,254,293.27 |
Less: Equity of minority shareholders | -761,469.33 | -761,469.33 |
Net assets acquired | 378,000,000.00 | 79,015,762.60 |
(4) Profits or losses from re-measurement of equity held before acquisition date in fair valueIs there any transaction that leads to business consolidation achieved through multiple transactions in various stages with controlacquired within the reporting period
□ Yes √ No
2. Disposal of subsidiaries
Is there any situation where disposal of investment in subsidiaries in a single transaction causes loss of control
□ Yes √ No
Is there any situation where disposal of investment in subsidiaries is achieved through multiple transactions in various stages,causing loss of control in this period
□ Yes √ No
3. Changes in the scope of combination for other reasons
Explanations on the changes in the scope of consolidation caused by other reasons (for example, newly established subsidiaries,subsidiaries clearing, etc.) and relevant information:
(1) There are 5 new merged units in the current period due to the following reasons:
New Merged Units This Year | Investment Ratio | Notes |
Zhuhai Songcheng Performance Kingdom Co., Ltd | 100% | New in 2020 |
Zhuhai Southern Film and Television Cultural Industry Co., Ltd. | 100% | Acquire 100% equity in 2020 |
Zhuhai Huayin Landscaping Co., Ltd. | 55% | 55% holding subsidiary affiliated Zhuhai Southern Film and Television Cultural Industry Co., Ltd. acquired in 2020 |
Songcheng Brand Management Co., Ltd. | 100% | New in 2020 |
Romance Show Management Co., Ltd. | 100% | New in 2020 |
(2) The number of merged units was decreased by 2 in the current period due to:
Reduced Merged Units This Year | Investment Ratio | Notes |
Hangzhou Songcheng Art Troupe Co., Ltd. | 100.00% | Canceled in 2020 |
Zhejiang Songcheng Entertainment Culture Co., Ltd. | 100.00% | Canceled in 2020 |
IX. Equity in Other Entities
1. Equity in Subsidiaries
(1) Composition of the enterprise group
Name of Subsidiaries | Main Place of Business | Registered Address | Business Nature | Shareholding Percentage | Acquisition Method | |
Direct | Indirect | |||||
Hangzhou Paradise Co., Ltd. | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Development of tourism project | 100.00% | Establishment | |
Sanya Romance Tourism Performance Co., Ltd. | Sanya, Hainan | Sanya, Hainan | Theme park + Art performance | 100.00% | Establishment | |
Lijiang Chama Ancient City | Lijiang, Yunnan | Lijiang, Yunnan | Theme park + Art performance | 100.00% | Establishment |
Tourism Development Co., Ltd | ||||||
Aba Zhou Jiuzhai Romance Tourism Development Co., Ltd | Jiuzhaigou, Aba, Sichuan | Jiuzhaigou, Aba, Sichuan | Theme park + Art performance | 100.00% | Business combination not under common control | |
Hangzhou Songcheng Tourism Development Co., Ltd | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Network technology, e-commerce | 100.00% | Establishment | |
Hangzhou Songcheng Dumuqiao Travel Services Co., Ltd | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Domestic tourism, inbound tourism | 100.00% | Establishment | |
Jiuzhaigou Tibetan Mystery Culture Co., Ltd | Jiuzhaigou, Aba, Sichuan | Jiuzhaigou, Aba, Sichuan | Development of tourism project | 60.00% | Business combination not under common control | |
Zhejiang Songcheng Longquan Mountain Tourism Development Co., Ltd | Longquan, Zhejiang | Longquan, Zhejiang |
100.00% | Establishment | |||||
Hangzhou Songcheng Technology Development Co., Ltd. | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Technology development, technology services and achievement transfer of smart entertainment products; sales and consulting services of technology | 100.00% | Establishment |
products; Internet information services | ||||||
Songcheng Performance International Development Co., Ltd. | Hong Kong, China | Hong Kong, China | Foreign investment; cultural performance; leisure tourism; international cultural and entertainment cooperation and development | 100.00% | Establishment | |
Songcheng (Australia) Holdings Pty Ltd | Queensland, Australia | Queensland, Australia | Cultural performance; leisure tourism; international cultural and entertainment cooperative development | 100.00% | Establishment | |
Songcheng (Australia) Entertainment Pty Ltd. | Queensland, Australia | Queensland, Australia | Cultural performance; leisure tourism; international cultural, film and television entertainment cooperation development | 100.00% | Establishment | |
Shanghai Songcheng World Expo Performance Development Co., Ltd | Shanghai | Shanghai | Performance venue management, planning for cultural and artistic exchange activities, industrial investment, investment management | 88.00% | Establishment | |
Songcheng | Shanghai | Shanghai | Performance | 100.00% | Establishment |
Performance Development (Shanghai) Co., Ltd. | venues, performance brokers, entertainment venues (singing and dancing entertainment venues, amusement entertainment venues), travel agency business, cultural and artistic exchange activities planning, public relations campaign planning | |||||
Guilin Lijiang Romance Performance Development Co., Ltd | Yangshuo, Guilin, Guangxi | Yangshuo, Guilin, Guangxi | Tourism project investment and development, cultural activities planning, cultural communication planning, leisure industry investment and development. | 70.00% | Establishment | |
Ningxiang Songcheng Tourism Development Co., Ltd. | Changsha, Hunan | Changsha, Hunan | Planning, design, development and management of scenic spot; literary and artistic creation services; engineering project management services; | 100.00% | Establishment | |
Zhangjiajie Romance Performance | Zhangjiajie, Hunan | Zhangjiajie, Hunan | Operating performances and economic | 100.00% | Establishment |
Development Co., Ltd | business; various performances; parking, performance venue management, tourism services; theme park development and operation, cultural activities planning | |||||
Songcheng Technology Development Co.,Ltd. | Yili, Xinjiang | Yili, Xinjiang | Technology development, technical service and achievement transfer of smart entertainment products | 100.00% | Establishment | |
Songcheng Tourism Development Co., Ltd. | Yili, Xinjiang | Yili, Xinjiang | Tourism resource development, tourism planning and design, artistic creation, brand and marketing planning of tourist attractions | 100.00% | Establishment | |
Songcheng Performance Management Co., Ltd. | Horgos, Xinjiang | Horgos, Xinjiang | Performance, artistic creation and choreography, performance and brokerage business, performance management | 100.00% | Establishment | |
Songcheng Dumuqiao Network Co., Ltd. | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Network technology; computer software and hardware; data processing and | 100.00% | Establishment |
analysis technology development; technical consulting, services, and transfer of achievements; booking tickets of scenic spots, air tickets, performance tickets and room reservations for customers; tourist information consulting, domestic tourism, and inbound tourism | ||||||
Xi'an Romance Performance Development Co., Ltd | Xi'an, Shanxi | Xi'an, Shanxi | Performance activities; performance brokerage; catering services; tourism services; theme park development and operation; | 80.00% | Establishment | |
Zhejiang Songcheng Xitang Performance Valley Performance Development Co., Ltd | Jiashan county, Jiaxing city, Zhejiang | Jiashan county, Jiaxing city, Zhejiang | Organization and planning of cultural and artistic exchange activities; cultural communication planning; tourism services; theme park development and operation; | 100.00% | Establishment | |
Foshan South Sea Qiao Mountain | Foshan, Guangdong | Foshan, Guangdong | Organization and planning of | 100.00% | Business combination not |
Cultural Tourism Development Co., Ltd | cultural and artistic exchange activities; cultural communication planning; tourism services; theme park development and operation; | under common control | ||||
Hangzhou Songguo Cultural Creative Co., Ltd. | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Sales: tourism supplies and arts & crafts (excluding gold ornaments), daily necessities, local specialties (excluding food) | 100.00% | Establishment | |
Hangzhou Songcheng performance Valley technology and Culture Development Co., Ltd | Hangzhou, Zhejiang | Hangzhou, Zhejiang | Music performances, opera performances, cabaret performances, acrobatic performances; performance brokers; smart entertainment products; cultural creative design | 100.00% | Establishment | |
Songcheng Holdings (Thailand) Co., Ltd. | Bangkok, Thailand | Bangkok, Thailand | Foreign investment; cultural performance; leisure tourism; international cultural and entertainment cooperation and development | 100.00% | Establishment | |
Songcheng (Pattaya) International | Pattaya, Thailand | Pattaya, Thailand | Cultural performance, including live | 65.00% | Establishment |
Culture Co., Ltd. | shows of theater performances (singing and dancing, acrobatics, drama, music, etc.); high-tech interactive experience; cultural activities planning, tourism e-commerce | |||||
Zhuhai Songcheng Performance Kingdom Co., Ltd | Zhuhai, Guangdong | Zhuhai, Guangdong | Music performances, opera performances, cabaret performances; acrobatics, tourism services, theme park development and operation, cultural activities planning and organization, cultural communication planning | 100.00% | Establishment | |
Zhuhai Southern Film and Television Cultural Industry Co., Ltd. | Zhuhai, Guangdong | Zhuhai, Guangdong | Project development, operation and management of film and television industry; development, operation and management of tourism projects; real estate development; business services and commercial | 100.00% | Business combination not under common control |
wholesale and retail | ||||||
Zhuhai Huayin Landscaping Co., Ltd. | Zhuhai, Guangdong | Zhuhai, Guangdong | Landscaping project; planting and sales of flowers and seedlings | 55.00% | Business combination not under common control | |
Songcheng Brand Management Co., Ltd. | Yili, Xinjiang | Yili, Xinjiang | Tourism resource development; tourism planning and design; artistic creation; brand planning of scenic spots; marketing planning of scenic spots; scenic project construction; domestic tourism, inbound tourism and ticket agency; ticket sales of scenic spots; | 100.00% | Establishment | |
Romance Show Management Co., Ltd. | Yili, Xinjiang | Yili, Xinjiang | Performance: singing and dancing, opera, acrobatics; artistic creation and choreography; operating performance and brokerage business; performance management | 100.00% | Establishment |
(2) Important non-wholly-owned subsidiaries
Unit: RMB
Name of Subsidiaries | Minority shareholding | Profit and loss attributed | Dividends declared to | Balance of equity of |
ratio of shareholders | to minority shareholders in the current period | minority shareholders in the current period | minority shareholders at the end of the period | |
Jiuzhaigou Tibetan Mystery Culture Co., Ltd | 40.00% | -2,349,016.01 | 16,399,460.63 | |
Guilin Lijiang Romance Performance Development Co., Ltd | 30.00% | -4,215,601.40 | 3,000,000.00 | 195,989,790.91 |
Xi'an Romance Performance Development Co., Ltd | 20.00% | -2,387,064.76 | 117,360,184.30 |
(3) Main financial information of important non-wholly-owned subsidiaries
Unit: RMB
Name of Subsidiaries | Balance at the End of the Period | Balance at the Start of the Period | ||||||||||
Current Assets: | Non-current Assets: | Total assets | Current Liabilities: | Non-current Liabilities: | Total Liabilities | Current Assets: | Non-current Assets: | Total assets | Current Liabilities: | Non-current Liabilities: | Total Liabilities | |
Jiuzhaigou Tibetan Mystery Culture Co., Ltd | 1,297,947.70 | 46,142,454.10 | 47,440,401.80 | 6,441,750.22 | 6,441,750.22 | 5,727,182.98 | 47,853,292.04 | 53,580,475.02 | 6,709,283.41 | 6,709,283.41 | ||
Guilin Lijiang Romance Performance Development Co., Ltd | 216,867,003.96 | 488,091,553.05 | 704,958,557.01 | 49,871,753.88 | 1,787,500.08 | 51,659,253.96 | 238,983,250.86 | 503,265,264.52 | 742,248,515.38 | 63,009,707.63 | 1,887,500.04 | 64,897,207.67 |
Xi'an Romance Performance Development Co., Ltd | 100,441,875.70 | 334,190,960.08 | 434,632,835.78 | 42,815,396.19 | 16,518.08 | 42,831,914.27 | 47,539,166.38 | 51,645,836.50 | 99,185,002.88 | 329,370.93 | 119,386.65 | 448,757.58 |
Unit: RMB
Name of Subsidiaries | This Period's Amount of Occurrence | Previous Period's Amount of Occurrence | ||||||
Operating income | Net Profit | --Total comprehensive income | Cash flow from operating activities | Operating income | Net Profit | --Total comprehensive income | Cash flow from operating activities | |
Jiuzhaigou Tibetan Mystery Culture Co., Ltd | 4,750.00 | -5,872,540.03 | -5,872,540.03 | -2,902,841.54 | 444,983.82 | -6,213,222.80 | -6,213,222.80 | -204,706.45 |
Guilin Lijiang Romance Performance Development Co., Ltd | 56,586,027.07 | -14,052,004.66 | -14,052,004.66 | -135,213,013.79 | 160,649,726.51 | 34,088,201.58 | 34,088,201.58 | 61,580,333.71 |
Xi'an Romance Performance Development Co., Ltd | 25,002,178.14 | -11,935,323.79 | -11,935,323.79 | 479,044.63 | -1,521,549.12 | -1,521,549.12 | -2,797,915.31 |
2. The transactions that lead to changes in the shareholder's equity in the subsidiaries while still has workingcontrol over the subsidiary
(1) Explanation of the changes in the shareholder's equity in the subsidiaries
In this period, the company acquired 20% of the shares held by the minority shareholders of Aba Zhou Jiuzhai RomanceTourism Development Co., Ltd. After the acquisition, the shareholding ratio of the company increased from 80% to 100%.
(2) The effect of the transactions on the equity of the minority shareholders and the shareholder's equityattributable to the parent company
Unit: RMB
Aba Zhou Jiuzhai Romance Tourism Development Co., Ltd | |
-- Cash | 82,500,000.00 |
Purchase cost/ Total disposal consideration | 82,500,000.00 |
Less: the share of net assets of the subsidiary calculated based | 47,040,672.62 |
on the ratio of equity obtained/disposed | |
Difference | 35,459,327.38 |
Among them: adjust the capital reserve | 35,459,327.38 |
3. Equity in joint venture arrangements or affiliates
(1) Important joint ventures or associates
Names of associates and joint ventures | Main Place of Business | Registered Address | Business Nature | Shareholding Percentage | Method for accounting the investment in associates and joint ventures | |
Direct | Indirect | |||||
Beijing Huafang Technology Co., Ltd. (formerly known as Beijing Six Rooms Technology Co., Ltd.) | Beijing | Beijing | Internet information service, performance brokerage business, business on music entertainment products through information network, competition activities | 37.06% | Equity method | |
Beijing Beite Shengdi Technology Development Co., Ltd. | Beijing | Beijing | Technical development, system integration, installation and commissioning of stage machinery, stage machinery control, lighting, and sound equipment; stage craft design and consultation; | 20.00% | Equity method |
(2) Main financial information of important associates
Unit: RMB
Closing balance / accrual of current period | Opening balance / accrual of previous period | |||
Beijing Huafang Technology Co., Ltd. (formerly known as Beijing Six Rooms Technology Co., Ltd.) | Beijing Beite Shengdi Technology Development Co., Ltd. | Beijing Huafang Technology Co., Ltd. (formerly known as Beijing Six Rooms Technology Co., Ltd.) | Beijing Beite Shengdi Technology Development Co., Ltd. | |
Current Assets: | 1,396,296,667.81 | 379,808,015.42 | 1,623,101,725.04 | 310,188,962.98 |
Non-current Assets: | 486,246,315.46 | 3,393,303.08 | 373,417,147.13 | 2,788,642.93 |
Total assets | 1,882,542,983.27 | 383,201,318.50 | 1,996,518,872.17 | 312,977,605.91 |
Current Liabilities: | 367,981,352.22 | 240,656,075.91 | 561,792,512.12 | 176,467,728.58 |
Non-current Liabilities: | 10,851,396.40 | 1,300,010.10 | 11,664.93 | 741,741.98 |
Total Liabilities | 378,832,748.62 | 241,956,086.01 | 561,804,177.05 | 177,209,470.56 |
Minority Shareholders' Equity | -4,903.84 | |||
Equity attributable to shareholders of the parent company | 1,503,710,234.65 | 141,250,136.33 | 1,434,714,695.12 | 135,768,135.35 |
Share of net assets calculated based on shareholding ratio | 557,275,012.96 | 28,250,027.27 | 567,142,718.98 | 27,153,627.07 |
Adjustments | 935,652,356.70 | 13,362,228.18 | 2,859,309,634.07 | 14,990,184.96 |
--Goodwill | 935,652,356.70 | 16,825,620.50 | 2,859,309,634.07 | 16,825,620.50 |
Unrealized Profit from Internal Transactions | -3,463,392.32 | -1,835,435.54 | ||
Book value of equity investment in associates | 1,492,927,369.66 | 41,612,255.45 | 3,426,452,353.05 | 42,143,812.03 |
Operating income | 3,777,442,691.41 | 321,940,699.67 | 2,367,480,161.77 | 338,824,205.43 |
Net Profit | -10,799,124.63 | 5,477,097.14 | 171,411,433.44 | 28,753,895.05 |
Other Comprehensive Incomes | 3,431,790.00 | -3,431,790.00 | ||
--Total comprehensive income | -7,367,334.63 | 5,477,097.14 | 167,979,643.44 | 28,753,895.05 |
Other explanation: The above data of statement was presented based on the fair value of the identifiable assets and liabilities of theinvestee when the investment was obtained.
X. Risks Relating to Financial Instruments
The company faces various financial risks in the course of its operations: credit risk, liquidity risk and market risk (includingexchange rate risk, interest rate risk and other price risks). The Board of Directors of the company is fully responsible for thedetermination of risk management objectives and bears the corresponding ultimate responsibility. The Board of Directors requiresthe management to design and implement procedures that can ensure the effective implementation of risk management objectivesand policies. The company’s management reviews the effectiveness of the implemented procedures and the rationality of riskmanagement objectives and policies through quarterly reports submitted by the Financial Department. The Treasury Department ofthe company audits the risk management policies and procedures, and report relevant findings to the company’s management.
The overall objective of the Company's risk management is to formulate risk management policies that can minimize riskswithout affecting the Company's competitiveness and adaptability to changes too much.
The company diversifies the risk of financial instruments by appropriate diversified investment and business portfolio. Inaddition, corresponding risk management policy is formulated to reduce the risk of concentration in single industry, specific regionor specific counter party.(I) Credit risk
Credit risk refers to the risk of the company's financial losses due to the failure of the counterparty to perform its contractualobligations.
The company’s credit risk mainly arises from monetary funds, notes receivable, accounts receivable, accounts receivablefinancing, other receivables, debt investments, other debt investments and financial guarantee contracts, investments in debtinstruments and derivative financial assets recognized in impairment testing scope, which are measured at fair value and relatedchanges are recognized in the current profit and loss, etc., On the Balance Sheet date, the book value of the company’s financialassets has represented its maximum credit risk exposure.
The company’s monetary funds are mainly bank deposits deposited in state-owned banks and other large and medium-sizedlisted banks with high credit ratings. The company believes that there is no major credit risk, and there is almost no significant lossresulting from breach of contract of the banks.
In addition, for bills receivable, accounts receivable, financing receivables and other receivables, the company sets relevantpolicies to control credit risk exposure. Before signing contracts, the company assesses the credit risk of new customers. Thecompany sets up credit limit and credit period according to different sales scale Generally, the company adopts more prudent creditpolicy for new customers and increases the proportion of advance receipts. The company promptly collects the accounts receivablefrom customers, and shortens or cancels the credit period for customers with bad credit records. At the same time, the companyensures that the overall credit risk of the company is under control through quarterly review of the aging analysis of accountsreceivable of existing customers.(II) Liquidity risk
Liquidity risk refers to the risk of a shortage of funds when an enterprise fulfills its obligation of settlement by cash or otherfinancial assets. The Company's policy is to ensure that there is sufficient cash to repay the liabilities due. The liquidity risk is underthe concentrated control of the Company's Financial Department. Through monitoring the balance of cash and securities cashableat any time and rolling forecasting the cash flow in the next 12 months, the Financial Department ensures that the Company hassufficient funds to repay its debts under all reasonable predictions. At the same time, the Finance Department constantly monitorswhether the company complies with the provisions of the loan agreement, and obtains commitments from major financialinstitutions to provide sufficient reserve funds to meet short-term and long-term funding needs.(III) Market Risk
The market risk of financial instruments refers to the risk of fluctuation at fair value of financial instruments or future cashflows with the change of market prices, including exchange rate risks and interest rate risks.
1. Interest rate risk
The interest rate risk refers to the risk in which the fair value or future cash flow of financial instruments changes due to thechange of market interest rate.Interest-bearing financial instruments with fixed and floating interest rates expose the company to fair value interest rate riskand cash flow interest rate risk, respectively. The company determines the proportion of fixed and floating interest rate instrumentsbased on the market environment, and maintains appropriate combination of fixed and floating interest rate instruments throughregular review and monitoring.On December 31, 2020, under the situation that other variables remain unchanged, if the borrowing rate calculated at floatinginterest rates rises or falls by 100 basis points, the company’s net profit will decrease or increase by RMB 1,235,208.33 (No externalborrowing and no affected amount as of Dec 31,2019). The management believes that 100 basis points reasonably reflect the rangeof possible changes in interest rates in the coming year.
2. Exchange rate risk
Exchange rate risk refers to the risk that the fair value of financial instruments or future cash flows will fluctuate due tochanges in foreign exchange rates.
The company tries its best to match foreign currency income with foreign currency expenditures. At the same time, itconstantly monitors the scale of foreign currency transactions and foreign currency assets and liabilities to minimize foreignexchange risks. In addition, the company signs forward foreign exchange contracts or currency swap contracts to achieve thepurpose of avoiding exchange rate risks.
The foreign exchange risks faced by the company are mainly from financial assets and financial liabilities in U.S. dollars, HongKong dollars, Australian dollars, and Thai baht. The amounts of foreign currency financial assets and liabilities converted into RMBare listed as follows:
Item | Balance at the End of the Period | ||||
USD | HKD | AUD | THB | Total | |
Cash and Bank Balances | 106,339,810.45 | 2,516,908.66 | 6,672,956.60 | 831,764.35 | 116,361,440.06 |
Trading financial assets (financial assets that are measured at fair value and related changes are recognized in current profit and loss) | 172,445,378.26 | 6,589,730.08 | 179,035,108.34 |
Other Equity Instruments | 9,291,430.32 | 9,291,430.32 |
Item | Balance at the end of the previous year | ||||
USD | HKD | AUD | THB | Total | |
Cash and Bank Balances | 6,722,634.59 | 2,761,248.62 | 169,908,170.39 | 987,917.54 | 180,379,971.14 |
Trading financial assets (financial assets that are measured at fair value and related changes are recognized in current profit and loss) | 110,024,148.79 | 110,024,148.79 | |||
Other Equity Instruments | 6,294,488.76 | 6,294,488.76 |
The foreign exchange risk arising from the above-mentioned foreign currency balance assets may have certain impact onoperating performance of the company. The company pays close attention to the impact of exchange rate changes on foreignexchange risks of the company, and takes corresponding measures to avoid foreign exchange risks.
XI. Disclosure of Fair Values
The input values applied in fair value measurement are divided into three levels:
The first-level input value is the unadjusted quotation of the same asset or liability in the active market that can be obtained onthe measurement date.
The second-level input value is the directly or indirectly observable input value of related assets or liabilities other than thefirst-level input value.
The third-level input value is the unobservable input value of related assets or liabilities.
The level of the fair value measurement result is determined by the lowest level of the input value which is of great significanceto the fair value measurement as a whole.
1. Fair values of the assets and liabilities at the end of the period
Unit: RMB
Item | Fair values at period-end | |||
First level measurement at fair value | Second level measurement at fair value | Third level measurement at fair value | Total | |
I. Constant measurement at fair value | -- | -- | -- | -- |
(I) Trading Financial Assets | 179,035,108.34 | 156,182,449.34 | 335,217,557.68 | |
1. Financial assets at fair value through profit or loss in this period | 179,035,108.34 | 156,182,449.34 | 335,217,557.68 | |
(1) Investment in debt instruments | ||||
(2) Investment in equity instrument | 172,445,378.26 | 172,445,378.26 | ||
(3)Derivative Financial Assets | 6,589,730.08 | 6,589,730.08 | ||
(4) Bank wealth management products | 156,182,449.34 | 156,182,449.34 | ||
2. Designated financial assets that are measured at fair value and whose changes are included in the current profit and loss |
(1) Investment in debt instruments | ||||
(2) Investment in equity instrument | ||||
(II) Investment in Other Creditor's Rights | ||||
(III) Investment in Other Equity Instruments | 224,266,596.74 | 224,266,596.74 | ||
(IV) Investment Property | ||||
1. Land use rights for lease | ||||
2. Rental buildings | ||||
3. Land use rights held and prepared to transfer after appreciation | ||||
(V) Biological assets | ||||
1. Consumable biological assets | ||||
2. Productive Biological Assets | ||||
Total assets constantly measured at fair value | 179,035,108.34 | 380,449,046.08 | 559,484,154.42 | |
(6) Transactional financial liabilities | ||||
Including: issued trading bonds | ||||
Derivative Financial Liabilities | ||||
Others | ||||
(7) Financial Liabilities measured in fair value with changes recognized in current profit and loss | ||||
Total amount of liabilities constantly measured at their fair values | ||||
II. Non-constant measurement at fair values | -- | -- | -- | -- |
(I) Holding for-sale assets | ||||
Total amount of assets with non-constant measurement at fair values | ||||
Total amount of liabilities with non-constant measurement at fair values |
2. The basis for determining the market price of constant and non-constant first-level fair value measurementitemsIt is confirmed in accordance with the closing price of open market transactions or the quotation amount provided bysecurities and fund companies as of December 31, 2020.
3. For the continuous and non-continuous third-level fair value measurement items, the valuation techniquesadopted and the qualitative and quantitative information of important parameters
For non-listed equity investment, fund investment and stock investment without public market quotation, the company appliesvaluation techniques to determine its fair value, including cash flow discount method and market comparison method. Its fair valueis measured using important unobservable parameters, such as liquidity discount, fluctuation rate, risk-adjusted discount andmarket multiplier. The fair value of non-listed equity investments, fund investments, and other investments has no significantsensitivity to reasonable changes in these unobservable input values.
In 2020, the valuation techniques used by the company for the above-mentioned constant third-level fair value measurementhave not been changed.
4. Sensitivity analysis on adjustment information between the opening and closing book value and unobservable parameters for constant third-level fair valuemeasurement items
Item | Balance at the end of the previous year | Transfer to the third level | Transfer from the third level | Total current gain or loss | Acquisition, issuance, sale and settlement | Balance at the End of the Period | For assets held at the end of the reporting period, the current unrealized gains or changes recognized in the profit and loss | ||||
Recognized in profit and loss | Recognized in other comprehensive income | Acquisition | Issuance | Sale | Settlement | ||||||
◆Trading financial assets | 744,083,937.75 | 15,364,620.95 | 711,000,000.00 | 1,314,266,109.36 | 156,182,449.34 | 182,449.34 |
Financial assets at fair value through profit or loss in this period | 744,083,937.75 | 15,364,620.95 | 711,000,000.00 | 1,314,266,109.36 | 156,182,449.34 | 182,449.34 | |||||
— Investment in debt instruments | |||||||||||
— Investment in equity instrument | |||||||||||
— Derivative Financial Assets |
— Bank financial products | 744,083,937.75 | 15,364,620.95 | 711,000,000.00 | 1,314,266,109.36 | 156,182,449.34 | 182,449.34 | |||||
Designated financial assets that are measured at fair value and whose changes are included in the current profit and loss | |||||||||||
— Investment in debt instruments | |||||||||||
— Others |
◆Receivables Financing | |||||||||||
◆Investment in Other Creditor's Rights | |||||||||||
◆Investment in Other Equity | 300,959,931.64 | -76,693,334.90 | 224,266,596.74 |
Instruments | |||||||||||
◆Other Non-current Financial Assets | |||||||||||
Financial assets at fair value through profit or loss in this period | |||||||||||
— Investment in debt instruments | |||||||||||
— Investment in equity instrument |
— Derivative Financial Assets | |||||||||||
— Others |
Total | 1,045,043,869.39 | 15,364,620.95 | -76,693,334.90 | 711,000,000.00 | 1,314,266,109.36 | 380,449,046.08 | 182,449.34 |
5. The fair value of financial assets and financial liabilities not measured at fair valueThere is no significant difference between the book value and fair value of the company’s financial assets and financialliabilities that are not measured at fair value.XII. Related Parties and Related-party Transactions
1. The Company's Parent Company
Name of parent company | Registered Address | Business Nature | Registered capital (RMB ten thousand) | Shareholding ratio of the parent company | Proportion of voting rights of the parent company |
Hangzhou Songcheng Group Holdings Co., Ltd | Hangzhou | Industrial investment, educational services, tourism project development | 100,000 | 29.48% | 29.48% |
Description of the parent company
Huang Qiaoling and related persons acting in concert directly hold 16.56% of the shares of the company. Hangzhou SongchengGroup Holdings Co., Ltd., the controlling shareholder of the company, holds 29.48% of the shares. Huang Qiaoling and relatedpersons acting in concert directly and indirectly hold 100.00% of the shares of Hangzhou Songcheng Group Holdings Co., Ltd.Huang Qiaoling and related persons acting in concert: Huang Qiaolong, Zhang Xian, Liu Ping, Huang Qiaoyan, and Dai Yinqin arerelated persons acting in concert of Huang Qiaoling.Huang Qiaoling and related persons in concert control the company by directly and indirectly holding of the shares.The ultimate controlling party of the company is Huang Qiaoling.
2. Information about the Company's subsidiaries
For details of subsidiaries of the Company, see Note "IX. Equities in other entities".
3. Information about the Company's joint ventures and affiliates
For details of significant joint ventures and associates of the Company, see Note "IX. Equities in other entities".
Names of joint ventures and affiliates | Relationship with the Company |
Beijing Huafang Technology Co., Ltd. (formerly known as Beijing Six Rooms Technology Co., Ltd.) | Affiliate |
Beijing Beite Shengdi Technology Development Co., Ltd. | Affiliate |
SABH's Big Adventure Inc. | Holds 11.0082% equity |
4. Information about other related parties
Names of other related parties | Relationship between the Company and other related parties |
Huang Qiaolong | Related natural person of Huang Qiaoling |
Zhang Xian | Related natural person of Huang Qiaoling |
Liu Ping | Related natural person of Huang Qiaoling |
Huang Qiaoyan | Related natural person of Huang Qiaoling |
Dai Yinqin | Related natural person of Huang Qiaoling |
Hangzhou World Leisure Expo Park Co., Ltd | Under the control of Huang Qiaoling |
Hangzhou Songcheng Industry Co., Ltd | Under the control of Huang Qiaoling |
Hangzhou First World Hotel Co., Ltd. | Under the control of Huang Qiaoling |
Longquan Mountain Resort Co., Ltd. | Under the control of Huang Qiaoling |
Qiyun Holdings (Thailand) Co., Ltd. (Qiyun Holding (Thailand) Co., Ltd.) | Under the control of Huang Qiaoling |
Xi'an International Horticultural Exposition Investment (Group) Co., Ltd. | Holds 20% of the company’s holding subsidiary |
Shanghai World Expo Dongdi Cultural Development Co., Ltd. | Holds 12% of the company’s holding subsidiary |
Guangzhou Gening Green Engineering Co., Ltd. | Holds 35% of the company’s holding subsidiary |
Zhongshan Dehua Green Engineering Co., Ltd. | Holds 10% of the company’s holding subsidiary |
5. Information about related-party transactions
(1) Related-party transactions involving purchase and selling of merchandise and provision and acceptance oflabor servicesMerchandise purchase and acceptance of labor services
Unit: RMB
Related parties | Content of the related - party transaction | This Period's Amount of Occurrence | Approved transaction limit | Over the transaction limit or not | Previous Period's Amount of Occurrence |
Hangzhou First World Hotel Co., Ltd. | On-line procurement of hotel products | No | 3,945,361.60 | ||
Hangzhou Songcheng Industry Co., Ltd | On-line procurement of hotel products | No | 30,527,071.00 | ||
Longquan Mountain Resort Co., Ltd. | On-line procurement of hotel products | No | 423,998.00 | ||
Beijing Beite Shengdi Technology Development Co., Ltd. | Delegation of the scenic spot-related projects | 29,155,963.23 | No | 9,594,276.67 | |
SABH's Big Adventure Inc. | Delegated to develop and design the SOW project | No | 5,489,285.80 | ||
Shanghai World Expo Dongdi Cultural Development Co., Ltd. | Brand usage fee | 9,433,962.00 | No | 9,571,349.95 |
Sales of merchandise and provision of services
Unit: RMB
Related parties | Content of the related - party transaction | This Period's Amount of Occurrence | Previous Period's Amount of Occurrence |
Hangzhou First World Hotel Co., Ltd. | Ticket sales | 1,431,730.00 | 4,870,053.00 |
Hangzhou Songcheng Industry Co., Ltd | Ticket sales | 2,425,720.00 | 7,870,590.00 |
Hangzhou First World Hotel Co., Ltd. | E-commerce handling fees | 170,475.39 | |
Hangzhou Songcheng Industry Co., Ltd | E-commerce handling fees | 83,981.38 |
Related-party transactions involving purchase and selling of merchandise and provision and acceptance of labor services
(1) The amount incurred in the previous period of related-party transactions with SABH's Big Adventure Inc., was USD 808,571,which was RMB 5,489,285.8 after conversion at the exchange rate on the day of foreign exchange purchase.
(2) The subsidiary Hangzhou Songcheng Dumuqiao Travel Services Co., Ltd, of the company, purchases hotel products fromassociates. The net method of accounting is applied in accordance with the requirements of the new revenue standards.
(2) Related leasing
The company as the lessee:
Unit: RMB
Name of Lessor | Type of the leased assets | Rental fee confirmed in the current period | Rental fee confirmed in the previous period |
Hangzhou Songcheng Industry Co., Ltd | Office building at No. 148, Zhijiang Road (Area of 5,591.53 square meters) | 2,396,369.06 | 3,930,045.36 |
Hangzhou Songcheng Industry Co., Ltd | Parking Lot at No. 148, Zhijiang Road (Area of 27,667 square meters) | 6,225,062.50 | 9,960,099.97 |
Hangzhou Songcheng Industry Co., Ltd | Operation of the scenic spot of the American City teaching building at No. 148 Zhijiang Road ( Area of 3,322 square meters) | 1,423,690.48 | 1,708,428.64 |
Hangzhou Songcheng Industry Co., Ltd | President Hill supporting housing and dormitory rooms of Huamei apartment at No. 148, Zhijiang Road, (Area of 7,114 square meters) | 1,600,625.00 | 1,920,750.00 |
Hangzhou Songcheng Industry Co., Ltd | American City parking lot at No. 148, Zhijiang Road ( Area of 13,185 square meters) | 2,966,625.00 | 3,559,950.00 |
Hangzhou Songcheng Industry Co., Ltd | Operation of scenic spots in American City at No. 148, Zhijiang Road ( Area of 7,730 square meters) | 1,656,428.58 | 1,987,714.38 |
Hangzhou First World Hotel Co., Ltd. | Office space of north building of the First World Hotel (Area | 472,500.00 | 756,000.00 |
of 3,000 square meters) | |||
Hangzhou World Leisure Expo Park Co., Ltd | Parking lot at No. 92 Xianghu road (Area of 19,192 square meters) | 4,318,187.50 | 5,181,840.00 |
Hangzhou World Leisure Expo Park Co., Ltd | Staff dormitory of Water City of Creative Park at No. 92 Xianghu Road (Area of 3,010 square meters) | 677,250.00 | 812,700.00 |
Xi'an International Horticultural Exposition Investment (Group) Co., Ltd. | The European style and international exhibition area of Xi’an World Expo Park, at Shibo Avenue, Chanba Ecological Zone, Xi’an City (Total area of 78,743.94 square meters) | 1,444,954.14 |
Description of related-party leasesDue to the impact of the "COVID-19", the lessors Hangzhou Songcheng Industrial Co., Ltd., Hangzhou First World Hotel Co., Ltd.and Hangzhou World Leisure Expo Park Co., Ltd. agreed to exempt the company from rental fee of 4.5 months during the closedperiod due to the epidemic.
(3) Remuneration for key management personnel
Unit: RMB
Item | This Period's Amount of Occurrence | Previous Period's Amount of Occurrence |
Salary of key management personnel | 380.85 | 357.60 |
(4) Other related-party transactions
In September 2019, Songcheng Holdings (Thailand) Co., Ltd., a wholly-owned subsidiary of the company, and its related partyQiyun Holding (Thailand) Co., Ltd. co-invested in Songcheng (Pattaya) International Culture Co., Ltd., which had registered capital ofTHB 5 million. The two parties subscribed THB 3.25 million and THB 750,000 with subscription ratios of 65.00% and 15.00%respectively. As of December 31, 2020, the company and its affiliates have not yet completed capital contributions.
6. Receivables and payables of the related parties
(1) Receivables
Unit: RMB
Item Name | Related parties | Balance at the End of the Period | Balance at the Start of the Period | ||
Book balance | Bad debt provision | Book balance | Bad debt provision | ||
Prepayments |
Hangzhou World Leisure Expo Park Co., Ltd | 2,997,262.50 | 1,998,125.01 | |||
Hangzhou First World Hotel Co., Ltd. | 283,500.00 | 700,000.00 | |||
Other Receivables | |||||
Shanghai World Expo Dongdi Cultural Development Co., Ltd. | 10,000,000.00 | 200,000.00 | 10,000,000.00 | 200,000.00 |
(2) Payables
Unit: RMB
Item Name | Related parties | Closing balance | Opening balance |
Accounts Payable | |||
Beijing Beite Shengdi Technology Development Co., Ltd. | 3,797,469.47 | 8,238,229.47 | |
Other Payables | |||
SABH's Big Adventure Inc. | 7,477,572.29 | ||
Xi'an International Horticultural Exposition Investment (Group) Co., Ltd. | 355,000.00 | ||
Guangzhou Gening Green Engineering Co., Ltd. | 2,531,680.00 | ||
Zhongshan Dehua Green Engineering Co., Ltd. | 686,011.00 |
Other notes: The balance of other payables of SABH's Big Adventure Inc. at the end of the period was USD 1,146,005.53, which wasconverted into RMB 7,477,572.29 at the exchange rate on the balance sheet date.XIII. Share-based payment
1. Overview of share-based payment
□ Applicable √ Not applicable
2. Situation of equity-settled share-based payment
□ Applicable √ Not applicable
3. Situation of cash-settled share-based payment
□ Applicable √ Not applicable
4. Modification and termination of share-based payment
N/AXIV. Commitments and contingencies
(一) Important Commitment
1. Important commitments on the Balance Sheet date
On June 21, 2019, the 32nd Meeting of the Sixth Board of Directors of the company reviewed and approved the "Proposal onUsing Idle Self-owned Funds to Invest in Securities and Wealth Management Products". It agreed that the company may use idleself-owned funds to invest in securities and financial products, so as to maintain and increase the value of idle funds on the basis ofensuring safety and liquidity, provided that the capital is secured, the operation is legal and compliant, normal production andoperation are not affected. The amount should not exceed RMB 2 billion. The funds within this limit can be used on a rolling basis.The use period is valid within 2 years from the date approved by Board of Directors. The management of the company is authorizedto exercise the right to make investment decisions and sign relevant legal documents within the limit.
2、 Commitment in operating lease
According to irrevocable operating lease contract that has been signed, the minimum lease payments that the company shouldpay after the balance sheet date are as follows:
Remaining lease term | Minimum lease payment |
Within 1 year | 39,527,812.50 |
1 to 2 years | 12,683,050.00 |
2 to 3 years | 6,066,000.00 |
3 years or above | 92,581,967.00 |
Total | 150,858,829.50 |
3. Contingencies
(1) Important contingent matters on the balance sheet day
The company has no important contingencies that need to be disclosed.
(2) If no important contingent matter to be disclosed by the Company, it should also be noted accordingly
No important contingent matter needs to be disclosed by the Company.
XV. Events after the Balance Sheet Date
1. Distribution of profits
Unit: RMB
Profits or dividends to be distributed | 130,734,702.00 |
Profits or dividends reviewed and approved for releasing | 130,734,702.00 |
2. Description of other matters after the balance sheet date
(I) Distribution of profitsAccording to the 2020 Annual Profit Distribution Plan adopted at the 10th Meeting of the Seventh Board of Directors of thecompany held on April 22, 2021, the company plans to distribute RMB 0.50 dividend (Including tax) in cash for every 10 shares to allshareholders based on the total share capital of 2,614,694,040 shares at the end of 2020. Total cash dividend of RMB 130,734,702was distributed.
(2) Transfer of post-period equity
1. On March 18, 2021, Songcheng Technology Development Co., Ltd., a subsidiary of the company, signed "Equity TransferAgreement" with 5 natural persons including Wen Qinglin. 20% of the equity of the target company Beijing Bette TechnologyDevelopment Co., Ltd. held by Songcheng Technology Development Co., Ltd. was transferred to 5 natural persons including WenQinglin. The transfer consideration of the equity transferred was the amount of RMB 30 million capital increase invested bySongcheng Technology Development Co., Ltd and corresponding investment income calculated at 10% annual simple interest duringthe actual investment period. The transfer consideration is paid in three installments: 60% of the total capital increase (RMB 18million) plus corresponding investment income shall be paid no later than Sept. 30, 2021 (including this date); 20% of the totalcapital increase (RMB 6 million) plus corresponding investment income shall be paid no later than Mar 31, 2022 (including this date);20% of the total capital increase (RMB 6 million) plus corresponding investment income shall be paid no later than Sept. 30, 2022(including this date); The target company Beijing Bette Technology Development Co., Ltd.. provides joint liability guarantee for allthe obligations of other 5 natural persons (including Wen Qinglin) under this agreement. The guarantee period is three years fromthe expiration date of the contract performance period. Within ten working days after receiving all the remaining transferconsideration, Songcheng Technology Development Co., Ltd. shall cooperate with the target company to complete the signing of theindustrial and commercial change documents required for the equity transfer. The personnel appointed by Songcheng TechnologyDevelopment Co.; Ltd. shall no longer serve as the director of the target company.
2. On April 7, 2021, the company and Longquan Tourism Investment Development Co., Ltd. signed "Equity Transfer Contract"regarding the equity and debts of Zhejiang Songcheng Longquan Mountain Tourism Development Co., Ltd., a wholly-ownedsubsidiary of the company. The subject matter of the transfer was 100% equity of Zhejiang Songcheng Longquan Mountain TourismDevelopment Co., Ltd. held by the company and all debts incurred prior to the closing of equity. The transaction consideration wasRMB 109,199,300 at the transaction price for 100% of the equity and RMB 166,800,700 at the liquidation for all debts incurred priorto the closing of equity. The total transaction price was RMB 27,600 ten thousand. The payment method is to pay 50% of thetransaction consideration within 40 days after this contract signed, and the remaining 50% of the transaction consideration within15 days after completion of the industrial and commercial change registration.
XVI. Other Significant Events
(I) Subsection information
1. Basis for determining report segment and accounting policies
The company determines the operating segment based on the internal organizational structure, management requirements,and internal reporting system and then determines the reporting segment based on operating segment.Operating segment refers to the component within the company that meets the following conditions at the same time: (1) Thecomponent can generate income and expenses in daily activities; (2) The management of the company can regularly evaluate theoperating results of such component so as to determine the allocation of resources to it and evaluate its performance; (3) Thecompany can obtain the accounting information of the component, such as the financial status, operating results and cash flowetc.,.The company reporting segment includes:
(1) Live performance: refers to all on-site scenic spots and theater businesses as the reporting segment, including SongchengScenic Area, Crazy Apple Land Scenic Area, Hangzhou Paradise Scenic Area, Sanya Romance Park, Lijiang Romance Park, JiuzhaiRomance Park, Tibetan Mystery Theater, Guilin Romance Park, Zhangjiajie Romance Park, Xi'an Romance Park;
(2) Tourism service industry: refers to the reporting segment of e-commerce, design and planning as well as the transportationservices for scenic spots.
2. Financial information of the reporting segment
Unit: RMB
Item | Live performance | Tourism service industry | Subtotal | Inter-segment offset | Total |
The revenue from main business | 636,915,514.47 | 223,223,920.66 | 860,139,435.13 | 30,000.00 | 860,109,435.13 |
Main business cost | 341,881,694.34 | 9,028,354.80 | 350,910,049.14 | 848,654.60 | 350,061,394.54 |
Total assets | 8,484,420,643.64 | 2,147,816,257.40 | 10,632,236,901.04 | 1,436,894,069.98 | 9,195,342,831.06 |
Total amount of liabilities | 2,292,248,984.48 | 564,197,439.88 | 2,856,446,424.36 | 1,396,363,757.08 | 1,460,082,667.28 |
XVII. Notes to Main Items in the Financial Statements of the Parent Company
1. Accounts receivable
(1) Categorical disclosure of accounts receivable
Unit: RMB
Category | Balance at the End of the Period | Balance at the Start of the Period | ||||||||
Book balance | Bad debt provision | Book value | Book balance | Bad debt provision | Book value | |||||
Amount | Percentage | Amount | Accrued | Amount | Percentage | Amount | Accrued |
proportion | proportion | |||||||||
Including: | ||||||||||
Accounts receivables with the bad debt provision accrued based on combinations | 52,370.14 | 100.00% | 14,145.24 | 27.01% | 38,224.90 | 1,334,890.64 | 100.00% | 65,055.55 | 4.87% | 1,269,835.09 |
Including: | ||||||||||
Combination of credit risk characteristics by age | 38,179.30 | 72.90% | 14,145.24 | 37.05% | 24,034.06 | 1,334,890.64 | 100.00% | 65,055.55 | 4.87% | 1,269,835.09 |
Consolidation scope and accounts receivable from related parties | 14,190.84 | 27.10% | 14,190.84 | |||||||
Total | 52,370.14 | 100.00% | 14,145.24 | 38,224.90 | 1,334,890.64 | 100.00% | 65,055.55 | 1,269,835.09 |
Bad debt provision based on combinations
Unit: RMB
Name | Balance at the End of the Period | ||
Book balance | Bad debt provision | Accrued proportion | |
Within credit period | 680.50 | 20.42 | 3.00% |
Credit period overdue within 1 year | 27,498.80 | 4,124.82 | 15.00% |
Credit period overdue within 1 to 2 years | 25.00% | ||
Credit period overdue within 2 to 3 years | 45.00% | ||
Credit period overdue within 3 to 4 years | 60.00% | ||
Credit period overdue within 4 to 5 years | 80.00% | ||
Credit period overdue for more than 5 years | 10,000.00 | 10,000.00 | 100.00% |
Total | 38,179.30 | 14,145.24 | -- |
Please refer to the disclosing methods of other receivables for the information disclosure of bad debts provisions, if the bad debtprovisions of accounts receivable are made according to the general model of expected credit losses:
□ Applicable √ Not applicable
Disclosure by age
Unit: RMB
Aging | Book balance |
Within 1 year | 42,370.14 |
2 to 3 years | |
3 to 4 years | |
4 to 5 years | |
5 years or above | 10,000.00 |
Total | 52,370.14 |
(2) Provision for bad debts accrued, recovered or reversed in this period
Provision for bad debts in the current period:
Unit: RMB
Category | Balance at the Start of the Period | Amount of Changes in the Current Period | Balance at the End of the Period | |||
Accrued | Recovered or Reversed | Written Off | Others | |||
Provision for bad debts of accounts receivable | 65,055.55 | -30,361.98 | 20,548.33 | 14,145.24 | ||
Total | 65,055.55 | -30,361.98 | 20,548.33 | 14,145.24 |
(3) Accounts receivable of the top five balances at the end of the period collected by the arrearsThere are no accounts receivable actually written off in the current period.
(4) Accounts receivable of the top five closing balances collected by debtors
Unit: RMB
Name of Unit | Accounts receivable at the end of the period | Proportion of the total accounts receivable at the end pf the period | Bad debt provision at the end of the period |
Xi'an Romance Performance Development Co., Ltd | 14,190.84 | 27.10% | |
Henan Longgui Cultural Tourism Development Co., Ltd. | 28,179.30 | 53.81% | 4,145.24 |
He Xiaojuan | 10,000.00 | 19.09% | 10,000.00 |
Total | 52,370.14 | 100.00% |
2. Other receivables
Unit: RMB
Item | Balance at the End of the Period | Balance at the Start of the Period |
Interest Receivable | ||
Dividends Receivable | ||
Other Receivables | 1,046,160,763.74 | 1,100,294,815.74 |
Total | 1,046,160,763.74 | 1,100,294,815.74 |
(1) Other Receivables
1) Other receivables categorized by the nature of the funds
Unit: RMB
Nature of the funds | Closing balance | Opening balance |
Employee loan | 1,378,749.73 | 1,034,409.72 |
Incomings and outgoings | 1,050,000.00 | 1,116,484.00 |
Security deposit, deposit | 349,030.00 | |
Internal current account within the scope of consolidation | 1,025,718,037.61 | 1,046,857,927.16 |
Equity transfer fund | 79,866,980.26 | 79,866,980.26 |
Others | 458,024.14 | 909,480.58 |
Total | 1,108,471,791.74 | 1,130,134,311.72 |
2) Bad debt provision
Unit: RMB
Bad debt provision | Phase One | Phase Two | Phase Three | Total |
Expected credit losses in the next 12 months | Expected credit losses for the entire extension (without credit impairment) | Expected credit losses for the entire extension (with credit impairment) | ||
Balance on January 1, 2020 | 35,390.52 | 29,804,105.46 | 29,839,495.98 | |
Balance of the current period on January 1, 2020 | —— | —— | —— | —— |
Provisions of this period | 7,123.90 | 32,550,115.00 | 32,557,238.90 | |
Other variations | -24,146.68 | -61,560.20 | -85,706.88 | |
Balance on December 31, 2020 | 18,367.74 | 62,292,660.26 | 62,311,028.00 |
Book balance changes with significant changes in loss provision in the current period
□ Applicable √ Not applicable
Disclosure by age
Unit: RMB
Aging | Book balance |
Within 1 year (including 1 year) | 1,027,351,939.02 |
1 to 2 years | 42,872.46 |
2 to 3 years | 100,000.00 |
3 to 4 years | 79,866,980.26 |
4 to 5 years | 60,000.00 |
5 to 6 years | 1,050,000.00 |
Total | 1,108,471,791.74 |
3) Provision for bad debts accrued, recovered or reversed in this period
Provision for bad debts in the current period:
Unit: RMB
Category | Balance at the Start of the Period | Amount of Changes in the Current Period | Balance at the End of the Period | |||
Accrued | Recovered or Reversed | Written Off | Others | |||
Provision for bad debts of other receivables | 29,839,495.98 | 32,557,238.90 | 85,706.88 | 62,311,028.00 | ||
Total | 29,839,495.98 | 32,557,238.90 | 85,706.88 | 62,311,028.00 |
4) Accounts receivable actually written off in this period
There are no actual written-off accounts receivable in this period.
5) Other receivables of the top five closing balances collected by debtors
Unit: RMB
Name of Unit | Nature of the funds | Balance at the End of the Period | Aging | As a percentage of total other receivables at the end of the period | Bad debt provision at the end of the period |
Zhangjiajie Romance Performance Development Co., Ltd | Consolidation of internal current account | 436,601,809.00 | Within 1 year | 39.39% |
Shanghai Songcheng World Expo Performance Development Co., Ltd | Consolidation of internal current account | 226,400,000.00 | Within 1 year | 20.42% | |
Zhejiang Songcheng Xitang Performance Valley Performance Development Co., Ltd | Consolidation of internal current account | 158,083,003.64 | Within 1 year | 14.26% | |
Zhejiang Songcheng Longquan Mountain Tourism Development Co., Ltd | Consolidation of internal current account | 146,490,000.00 | Within 1 year | 13.22% | |
An Xiaofen (formerly: Horgos Dasheng Legend Venture Capital Co., Ltd.) | Equity transfer fund | 79,866,980.26 | 3-4 years | 7.21% | 61,242,660.26 |
Total | -- | 1,047,441,792.90 | -- | 94.50% | 61,242,660.26 |
3. Long-term equity investment
Unit: RMB
Item | Balance at the End of the Period | Balance at the Start of the Period | ||||
Book balance | Provision for decline in value | Book value | Book balance | Provision for decline in value | Book value | |
Investment in subsidiaries | 4,940,162,163.79 | 4,940,162,163.79 | 3,563,757,019.35 | 3,563,757,019.35 | ||
Investment in affiliates and joint ventures | 3,307,758,983.34 | 1,814,682,876.81 | 1,493,076,106.53 | 3,378,092,795.14 | 3,378,092,795.14 | |
Total | 8,247,921,147.13 | 1,814,682,876.81 | 6,433,238,270.32 | 6,941,849,814.49 | 6,941,849,814.49 |
(1) Investment in Subsidiaries
Unit: RMB
The invested entity | Balance at the Start of the Period (book value) | Decrease/Increase in the current period | Balance at the End of the Period (book value) | Closing balance of provision for decline in value | |||
Investments increased | Investment decreased | Provision for impairment accrued | Others | ||||
Hangzhou Songcheng Art | 3,100,000.00 | 3,100,000.00 |
Troupe Co., Ltd. | |||||||
Hangzhou Paradise Co., Ltd. | 368,458,844.16 | 269,943,679.30 | 638,402,523.46 | ||||
Sanya Romance Tourism Performance Co., Ltd. | 490,000,000.00 | 490,000,000.00 | |||||
Lijiang Chama Ancient City Tourism Development Co., Ltd | 250,000,000.00 | 250,000,000.00 | |||||
Aba Zhou Jiuzhai Romance Tourism Development Co., Ltd | 176,000,000.00 | 82,500,000.00 | 258,500,000.00 | ||||
Hangzhou Songcheng Tourism Development Co., Ltd | 10,000,000.00 | 10,000,000.00 | |||||
Zhejiang Songcheng Entertainment Culture Co., Ltd. | 50,000,000.00 | 50,000,000.00 | |||||
Jiuzhaigou Tibetan Mystery Culture Co., Ltd | 87,000,000.00 | 87,000,000.00 | |||||
Zhejiang Songcheng Longquan Mountain Tourism Development Co., Ltd | 120,000,000.00 | 120,000,000.00 | |||||
Hangzhou Songcheng Technology Development Co., Ltd. | 39,530,000.00 | 39,530,000.00 | |||||
Songcheng Performance International Development Co., Ltd. | 606,367,375.19 | 606,367,375.19 |
Shanghai Songcheng World Expo Performance Development Co., Ltd | 132,000,000.00 | 132,000,000.00 | |||||
Songcheng Performance Development (Shanghai) Co., Ltd. | 500,000.00 | 500,000.00 | |||||
Guilin Lijiang Romance Performance Development Co., Ltd | 455,000,000.00 | 455,000,000.00 | |||||
Zhangjiajie Romance Performance Development Co., Ltd | 120,000,000.00 | 120,000,000.00 | |||||
Songcheng Performance Management Co., Ltd. | 500,000.00 | 500,000.00 | |||||
Songcheng Dumuqiao Network Co., Ltd. | 4,000,000.00 | 4,000,000.00 | |||||
Xi'an Romance Performance Development Co., Ltd | 100,000,000.00 | 185,000,000.00 | 285,000,000.00 | ||||
Zhejiang Songcheng Xitang Performance Valley Performance Development Co., Ltd | 100,000,000.00 | 100,000,000.00 | |||||
Foshan South Sea Qiao Mountain Cultural Tourism Development Co., Ltd | 448,950,800.00 | 448,950,800.00 | |||||
Hangzhou Songguo | 2,350,000.00 | 2,350,000.00 |
Cultural Creative Co., Ltd. | |||||||
Zhuhai Southern Film and Television Cultural Industry Co., Ltd. | 378,000,000.00 | 371,297,581.07 | 6,702,418.93 | ||||
Zhuhai Songcheng Performance Kingdom Co., Ltd | 396,297,581.07 | 396,297,581.07 | |||||
Hangzhou Songcheng performance Valley technology and Culture Development Co., Ltd | 489,061,465.14 | 489,061,465.14 | |||||
Total | 3,563,757,019.35 | 1,800,802,725.51 | 424,397,581.07 | 4,940,162,163.79 |
(2) Investment in affiliates and joint ventures
Unit: RMB
Name of Investees | Balance at the Start of the Period (book value) | Decrease/Increase in the current period | Balance at the End of the Period (book value) | Closing balance of provision for decline in value | |||||||
Investments increased | Investment decreased | Investment profit and loss recognized under the equity method | Adjustment on other comprehensive income | Other changes in equity | Cash dividends or profit declared to distribute | Provision for impairment accrued | Others | ||||
Ⅰ. Joint ventures | |||||||||||
Ⅱ. Affiliates | |||||||||||
Beijing Huafang Technology Co., Ltd. (formerly known as | 3,378,092,795.14 | -2,969,195.48 | 37,670.53 | -67,402,286.85 | -1,814,682,876.81 | 1,493,076,106.53 | 1,814,682,876.81 |
Beijing Six Rooms Technology Co., Ltd.) | |||||||||||
Subtotal | 3,378,092,795.14 | -2,969,195.48 | 37,670.53 | -67,402,286.85 | -1,814,682,876.81 | 1,493,076,106.53 | 1,814,682,876.81 | ||||
Total | 3,378,092,795.14 | -2,969,195.48 | 37,670.53 | -67,402,286.85 | -1,814,682,876.81 | 1,493,076,106.53 | 1,814,682,876.81 |
4. Operating income and operating costs
Unit: RMB
Item | This Period's Amount of Occurrence | Previous Period's Amount of Occurrence | ||
Income | Cost | Income | Cost | |
Main Business | 15,832,779.35 | 19,532,790.64 | 733,342,510.96 | 389,275,037.47 |
Other businesses | 7,059,972.03 | 59,192,952.96 | ||
Total | 22,892,751.38 | 19,532,790.64 | 792,535,463.92 | 389,275,037.47 |
Related information of revenue:
Unit: RMB
Contract classification | Segment 1 | Segment 2 | Culture and art industry-live performance | Other businesses | Total |
Product types | 15,832,779.35 | 7,059,972.03 | 22,892,751.38 | ||
Including: | |||||
(1) Income from Hangzhou Songcheng tourist area | 15,832,779.35 | 15,832,779.35 | |||
(2) Other businesses | 7,059,972.03 | 7,059,972.03 | |||
Contract type | 15,832,779.35 | 7,059,972.03 | 22,892,751.38 | ||
(1) Revenue from contract | 15,832,779.35 | 5,359,934.07 | 21,192,713.42 | ||
Including: | |||||
Confirm at time points | 15,832,779.35 | 5,150,736.86 | 20,983,516.21 | ||
Confirm within a certain period of | 209,197.21 | 209,197.21 |
time | |||||
(2) Income from the rental of scenic spots | 1,700,037.96 | 1,700,037.96 |
Information related to performance obligations:
N/AInformation related to the transaction price allocated to the remaining obligations:
At the end of this report, the amount of income corresponding to the obligations under the contract that have been signed but havenot been performed or have not been completely performed is RMB 0.00, in which, RMB 0.00 is expected to be included in incomein Year 0.
5. Investment income
Unit: RMB
Item | This Period's Amount of Occurrence | Previous Period's Amount of Occurrence |
Long-term equity investment income calculated by cost method | 432,000,000.00 | 618,000,000.00 |
Long-term equity investment income measured by equity method | -2,931,524.95 | 110,867,013.28 |
Investment income from disposal of long-term equity investment | -6,520,482.12 | 560,910.55 |
Investment income from disposal of trading financial assets | 2,412,380.45 | 15,755,921.52 |
Gains resulting from loss of control due to capital increase by minority shareholders from the invested entities | 499,652,459.43 | |
Total | 424,960,373.38 | 1,244,836,304.78 |
XVIII. Supplementary Information
1. Breakdown of non-recurring gains and losses for this period
√ Applicable □ Not applicable
Unit: RMB
Item | Amount | Note |
Gains and losses from disposal of non-current assets | -37,625,882.13 | |
The government subsidies included in the current profits and losses (excluding the government subsidies closely related to | 35,618,594.19 |
regular businesses of the Company and issued in the quota or quantity based on the national standards) | ||
Profits and losses resulting from the changes in fair value for holding trading financial assets, derivative financial assets and trading financial liabilities, derivative financial liabilities and investment income from disposal of trading financial assets, derivative financial assets, trading financial liabilities, derivative financial liabilities, and other obligatory right investment, excluding the effective hedging businesses related to the regular business operation of the Company | 19,619,586.83 | |
Non-Operating Revenue and expenses other than the above | -509,618.20 | |
Less: Impact of income tax | 2,230,795.39 | |
Impact of minority equity | -591,743.78 | |
Total | 15,463,629.08 | -- |
For items defined as non-recurring gains and losses according to the No. 1 Explanatory Announcement on Information Disclosurefor Companies Offering Their Securities to Public - Non-recurring Gains and Losses, or non-recurring gains and losses items listed inthe said document defined as recurring ones, please specify the reasons.
□ Applicable √ Not applicable
2. Return on net assets and earnings per share
Profit for the reporting period | Weighted Average ROE | Earnings per share | |
Basic Earnings per Share (RMB/Share) | Diluted Earnings per Share (RMB/Share) | ||
Net profit attributable to common shareholders of the Company | -20.50% | -0.6702 | -0.6702 |
Net profit attributable to common shareholders of the Company after deducting non-recurring gains and losses | -20.68% | -0.6761 | -0.6761 |
Section XIII Documents Available for ReferenceI. The financial statements signed and sealed by the legal representative, the chief accountant and the person in charge ofaccounting institution (Accounting Officer) of the Company.
II. The original copy of the Audit Report with the seal of the Accounting Firm and signed and stamped by Certified PublicAccountants.III. Originals of all the Company's documents and announcements published on the website designated by China SecuritiesRegulatory Commission during the reporting period.IV. Original of 2020 Annual Report signed by the legal representative of the Company.V. Other related information.The said documents are prepared and placed at the Company's Securities Investment Department
Songcheng Performance Development Co., Ltd
Chairman: Huang Qiaoling
April 23, 2021
Note:
This document is a translated version of the Chinese version 2020 Annual Report (“2020年年度报告”), and the published annualreport in the Chinese version shall prevail. The complete published Chinese 2020 Annual Report may be obtained atwww.cninfo.com.cn.