Jiangling Motors Corporation, Ltd.
2022 Annual Report
2023-03
Chapter I Important Notes, Contents and Abbreviations
Important NoteThe Board of Directors and its members, the Supervisory Board and its members,and the senior executives are jointly and severally liable for the truthfulness,accuracy and completeness of the information disclosed in the report and confirmthat the information disclosed herein does not contain any false statement,misrepresentation or major omission.
Chairman Qiu Tiangao, CFO Joey Zhu and Chief of Finance Department, Ding Ni,confirm that the Financial Statements in this Annual Report are truthful andcomplete.
All Directors were present at the Board meeting to review this Annual Report.
Future plans, development strategies and other forward-looking statements inthis report do not constitute a substantial commitment of the Company toinvestors. Investors are advised to pay attention to investment risks.
The Company's possible risks and countermeasures are described in Section 3of this report, "Management Discussion and Analysis". Please investors to payattention to the relevant content.
The Annual Report is prepared in Chinese and English. In case of discrepancy,the Chinese version will prevail.
The year 2022 profit distribution proposal approved by the Board of Directors isas follows:
A cash dividend of RMB 4.24 (including tax) will be distributed for every 10shares held based on the total share capital of 863,214,000 shares, and there isno stock dividend. The Board decided not to convert capital reserve to sharecapital this time.
Contents
Chapter I Important Notes, Contents and Abbreviations ...... 2
Chapter II Brief Introduction and Operating Highlight ...... 5
Chapter III Management Discussion and Analysis ...... 10
Chapter IV Corporate Governance Structure ...... 29
Chapter V Environment and Social Responsibilities ...... 54
Chapter VI Major events ...... 58
Chapter VII Share Capital Changes & Shareholders ...... 63
Chapter VIII Preferred Shares ...... 68
Chapter IX Bond related Information ...... 69
Chapter X Financial Statements ...... 70
Catalog on Documents for Reference
1. Originals of 2022 financial statements signed by legal representative, ChiefFinancial Officer and Chief of Finance Department.
2. Originals of the Independent Auditor’s Reports signed by Independent
accountants and stamped by the accounting firm.
3. Originals of all the documents and public announcements disclosed in
newspapers designated by CSRC in 2022.
4. The Annual Report in the China GAAP.
Abbreviations:
CSRC China Securities Regulatory CommissionJMCG Jiangling Motors Group Co., Ltd.Ford Ford Motor CompanyJIC Nanchang Jiangling Investment Co., Ltd.JMC or the Company Jiangling Motors Corporation, Ltd.JMCH JMC Heavy Duty Vehicle Co., Ltd.EVP Executive Vice PresidentCFO Chief Financial OfficerVP Vice President
Chapter II Brief Introduction and Operating Highlight
1. Company’s Information
| Share’s name | Jiangling Motors, Jiangling B | Share’s Code | 000550, 200550 |
| Place of listing | Shenzhen Stock Exchange | ||
| Company’s Chinese name | 江铃汽车股份有限公司 | ||
| English name | Jiangling Motors Corporation, Ltd. | ||
| Abbreviation | JMC | ||
| Company legal representative | Qiu Tiangao | ||
| Registered Address | No. 2111, Yingbin Middle Avenue, Nanchang County, Nanchang City, Jiangxi Province, P.R.C | ||
| Postal Code of Registered Address | 330200 | ||
| Changes of Registered Address | Due to the relocation of JMC’s Qingyunpu site, the original registered address " No. 509, Northern Yingbin Avenue, Nanchang City, Jiangxi Province" was changed to "No.2111, Yingbin Middle Avenue, Nanchang County, Nanchang City, Jiangxi Province" in October 2021. | ||
| Headquarters Address | No. 2111, Yingbin Middle Avenue, Nanchang County, Nanchang City, Jiangxi Province, P.R.C | ||
| Postal Code of Headquarters Address | 330200 | ||
| Website | http://www.jmc.com.cn | ||
| relations@jmc.com.cn | |||
2. Contact Person and Method
| Board Secretary | Securities Affairs Representative | |
| Name | Xu Lanfeng | Quan Shi |
| Address | No. 2111, Yingbin Middle Avenue, Nanchang County, Nanchang City, Jiangxi Province, P.R.C | No. 2111, Yingbin Middle Avenue, Nanchang County, Nanchang City, Jiangxi Province, P.R.C |
| Tel | 86-791-85266178 | 86-791-85266178 |
| Fax | 86-791-85232839 | 86-791-85232839 |
| relations@jmc.com.cn | relations@jmc.com.cn |
3. Information Disclosure and Place for Achieving Annual Report
| Stock Exchange Website for Publication of JMC’s Annual Report | http://www.szse.cn |
| Newspapers and Website for | China Securities, Securities Times, Hong Kong |
| Publication of JMC’s Annual Report | Commercial Daily, cninfo (http://www.cninfo.com.cn) |
| Place for Achieving Annual Report | Securities Department, Jiangling Motors Corporation, Ltd. |
4. Changes of Registration
| Unified social credit code | 913600006124469438 |
| Changes in the Main Business since the Listing | No change. |
| Changes of Controlling Shareholders | On December 1, 1993, JMC A shares were listed on Shenzhen Stock Exchange, while JMCG, the founder-member, was the controlling shareholder of the Company. On September 29, 1995 and November 12, 1998, JMC issued additional 344 million B shares totally, while, after the additional B share issuance, JMCG and Ford were the controlling shareholders of the Company. On December 8, 2005, the 354.176 million JMC shares held by JMCG, the former controlling shareholder, were transferred to Jiangling Motor Holdings Co., Ltd. After the transference, Jiangling Motor Holdings Co., Ltd. and Ford were the controlling shareholders of the Company. In 2019, Jiangling Motor Holdings Co., Ltd., the former controlling shareholder, was divided and separated into Jangling Motor Holdings Co., Ltd. and Nanchang Jiangling Investment Co., Ltd., and transferred the 354.176 million JMC shares it held to Nanchang Jiangling Investment Co., Ltd. Presently, Nanchang Jiangling Investment Co., Ltd. and Ford are the controlling shareholders of the Company. |
5. Other Information
Accounting Firm Appointed by JMC for Audit
| Name | PricewaterhouseCoopers Zhong Tian LLP (‘PwC Zhong Tian’) |
| Headquarters Address | 11/F, PricewaterhouseCoopers Center Link Square 2,202 Hu Bin Road, Huangpu District, Shanghai 200021, PRC |
| Names of Signed Accountants | Ye Jun, Xiao Minjie |
The recommendation agency engaged by the Company executing the persistentsupervision responsibilities in the reporting period
□Applicable □√Not Applicable
The financial consultant engaged by the Company performing the duties ofpersistent supervision and guidance in the reporting period
□Applicable □√Not Applicable
6. Main accounting data and financial ratios
Unit: RMB
| 2022 | 2021 | Change (%) | 2020 | |
| Revenue | 30,100,283,842 | 35,221,306,472 | -14.54% | 33,095,733,665 |
| Profit Attributable to the Equity Holders of the Company | 915,049,168 | 574,165,944 | 59.37% | 550,698,958 |
| Net Profit Attributable to Shareholders of Listed Company After Deducting Non-Recurring Profit or Loss | -229,667,660 | 29,628,811 | -875.15% | 405,188,533 |
| Net Cash Generated From Operating Activities | -1,518,573,952 | 1,760,193,010 | -186.27% | 3,698,342,828 |
| Basic Earnings Per Share (RMB) | 1.06 | 0.67 | 59.37% | 0.64 |
| Diluted Earnings Per Share (RMB) | 1.06 | 0.67 | 59.37% | 0.64 |
| Weighted Average Return on Equity Ratio | 10.28% | 5.87% | 4.41% | 5.13% |
| End of Year 2022 | End of Year 2021 | Change (%) | End of Year 2020 | |
| Total Assets | 27,468,321,835 | 26,359,084,120 | 4.21% | 28,185,185,418 |
| Shareholders’ Equity Attributable to the Equity Holders of the Company | 9,243,817,333 | 8,555,444,589 | 8.05% | 10,986,474,009 |
The lower of the Company’s net profit before and after deduction of non-recurringgains and losses in the most recent three fiscal years is negative, and the auditreport of the most recent year shows that the Company’s ability to continueoperations is uncertain
□Yes □√No
The lower of the net profit before and after non-recurring gains and losses isnegative
□√Yes □No
Units: RMB
| Item | 2022 | 2021 | remark |
| Revenue | 30,100,283,842 | 35,221,306,472 | |
| Amount Deducted from | 507,757,923 | 691,258,152 | JMC main business includes the sales of automobile and spare parts and automobile |
| Revenue | maintenance services, the sales of materials, revenue from technical service and other business activities other than the main business activities shall be deducted. | ||
| Amount after Deduction from Revenue | 29,592,525,919 | 34,530,048,320 |
7. Accounting data difference between China GAAP and IFRS
I. Differences in net profit and net assets in financial statements between inaccordance with international accounting standards and Chinese accountingstandards
□Applicable □√Not Applicable
II. Differences in net profit and net assets in financial statements between inaccordance with overseas accounting standards and Chinese accountingstandards
□Applicable □√Not Applicable
III. Reasons for the difference in accounting data under domestic and foreignaccounting standards
□Applicable □√Not Applicable
8. Main accounting data quarterly
Unit: RMB
| Q1 | Q2 | Q3 | Q4 | |
| Revenue | 7,232,030,037 | 6,990,729,347 | 7,808,857,974 | 8,068,666,484 |
| Profit Attributable to the Equity Holders of the Company | 193,977,828 | 258,403,194 | 264,803,793 | 197,864,353 |
| Net Profit Attributable to Shareholders of Listed Company After Deducting Non-Recurring Profit or Loss | -27,656,476 | -80,778,100 | 39,085,652 | -160,318,736 |
| Net Cash Generated From Operating Activities | -2,691,345,433 | -640,201,042 | 1,108,616,335 | 704,356,188 |
Whether the above mentioned financial indicators or the total number aresignificantly different from the financial indicators related to the disclosedquarterly and half-year reports of the Company
□Yes □√No
9. Non-recurring profit and loss items and amounts
□√Applicable □Not Applicable
Unit: RMB
Details of other profit and loss items that meet the definition of non-recurringprofit and loss
□Applicable □√Not Applicable
There is no any other profit and loss items that meet the definition of non-recurring profit and loss in the Company.The description of that the non-recurring profit and loss items listed in CorporateInformation Disclosure of Public Issuing Securities No.1 are defined as recurringprofit and loss items
□Applicable □√Not Applicable
The Company does not have a situation in which the non-recurring profit and lossitems listed in No.1 of Corporate Information Disclosure Announcement No.1 aredefined as recurring profit and loss.
| 2022 | 2021 | 2020 | |
| Profit and loss of non-current assets disposal (including the charge-off part of the asset impairment provision) | 389,251,475 | 5,107,814 | -167,780,780 |
| Government subsidies included in the current profit and loss | 943,326,556 | 552,831,370 | 277,756,664 |
| Capital occupation fee charged for non-financial enterprises included in the current profit and loss | 13,827,410 | 15,836,668 | 7,628,722 |
| In addition to the effective hedging business related to the normal operating business of the Company, holding the gains and losses of fair value changes arising from trading financial assets and trading financial liabilities, as well as the investment income obtained from the disposal of trading financial assets, trading financial liabilities and available for sale financial assets | 1,424,039 | -16,082,076 | 76,150,461 |
| Return of the impairment provision for receivables with a separate impairment test | 110,068 | 2,250,000 | 6,540,000 |
| Other non-operating income and expenses except the above | 1,423,948 | 2,027,076 | 5,869,080 |
| Other profit and loss items that meet the definition of non-recurring profit and loss | - | 18,765,020 | -10,493,560 |
| Gains on disposal of long-term equity investments | - | 52,133,307 | - |
| Less: Income tax impact amount | 204,283,363 | 88,332,046 | 50,160,162 |
| Influence of minority shareholders' equity | 363,305 | - | - |
| Total | 1,144,716,828 | 544,537,133 | 145,510,425 |
Chapter III Management Discussion and Analysis
1. The industry situation of the Company during the reporting periodIn 2022, the production and sales volume of automobiles were 27,021 thousandand 26,864 thousand respectively, with year-on-year growth of 3.4% and 2.1%,achieving slight growth for the whole year. Driven by policies to stabilize growthand promote consumption, passenger vehicles grew rapidly, contributing animportant part to the year's modest growth. Commercial vehicles are operating atthe low level of overlaid factors. New energy vehicles continued explosive growth,with annual sales exceeding 6.8 million units and the market share increasing to
25.6%. New energy vehicles gradually entered the full market expansion period,ushering in a new stage of development and growth. Automobile exportcontinues to maintain a high level, repeatedly hitting a monthly record high. SinceAugust, the monthly average export volume has exceeded 300,000 units, and theannual export volume has surpassed 3 million units, effectively driving the overallgrowth of the industry. The performance of Chinese brands is outstanding,grasping the transformation opportunities of new energy and intelligent network,and improving product competitiveness. The market share of passenger vehiclesis close to 50%, which is a new high in recent years.
The production and sales volume of passenger vehicles were 23,836 thousandand 23,563 thousand respectively, with YOY growth of 11.2% and 9.5%, which ishigher than the industry average. Among the main varieties of passengervehicles, compared with the same period last year, the production and sales ofbasic passenger vehicles (sedans) and sport-utility vehicles (SUVs) showedrapid growth and continued to occupy the dominant position. The other twomodels witnessed different degrees of decline.
The production and sales of commercial vehicles were 3,185 thousand and 3,300thousand, respectively, down 31.9% and 31.2% year-on-year, showing double-digit declines. Among the main varieties of commercial vehicles, compared withthe same period last year, the production and sales of buses and trucksdecreased rapidly. Among the main truck models, compared with the sameperiod last year, the production and sales of the four categories of trucks allshowed a double-digit decline, among which the decline of heavy trucks andmedium trucks was more obvious; Among the main varieties of buses, comparedwith the same period last year, the production and sales of large buses achieveda small growth, but medium-sized buses and light bus dropped significantly.
Due to the lack of overseas supply and the substantial enhancement of exportcompetitiveness of Chinese automobile enterprises, the export exceeded 3million units to reach 3,111 thousand units, up 54.4% year on year, effectivelydriving the overall growth of the industry. The export of passenger vehicles was2,529 thousand, up 56.7% year on year. Commercial vehicle export reached 582thousand units, with YOY increase of 44.9%. The export of new energy vehiclesreached 679 thousand units, witnessing 1.2 times growth year on year. Since
2021, the total annual volume of China's automobile export exceeded 2 millionfor the first time, breaking the situation of hovering around 1 million before, andrealized the leap-forward breakthrough. The production and sales of new energyvehicles reached 7,058 thousand and 6,887 thousand respectively, with a year-on-year growth of 96.9% and 93.4%, and the market share of 25.6%. Among themain varieties of new energy vehicles, compared with the same period last year,the production and sales of BEV, PHEV and fuel cell vehicles continued tomaintain rapid growth.
2. Company’s Core Business during the Reporting Period
During the reporting period, the Company's main business is the production andsale of commercial vehicles, SUVs and related components. The main productsinclude JMC light truck, Pickup, light bus, Yusheng SUV, Ford-branded light bus,MPV and other commercial vehicles and SUV products. JMC also producesengines, castings and other components. The Company takes high qualitydevelopment as the main line, focuses on value, lean operation, and transformsfrom scale expansion development to lean value growth.
In 2022, JMC continued to expand the technical reservation and investment innew products, smart connectivity, new energy and light weight, etc. Based onvehicle, JMC developed autonomous driving and smart connectivity functionsand achieved more function expansion through the third space with vehicle asthe carrier. At the same time, JMC strengthens the construction of digitalizationoperation capability, thus entering such key value fields as network socializationand financial payment, etc., forming massive ecological circle and presentingexcellent overall performance in the industry.
In 2022, JMC planned the productivity of 320,000 units and the utilization ratewas 88%.
Vehicle manufacturing and operation
□√Applicable □Not Applicable
Production and Sales Volume Information
| Production Volume (Unit) | Sales Volume (Unit) | |||||
| 2022 FY | 2021 FY | YOY change (%) | 2022 FY | 2021 FY | YOY change (%) | |
| By Products | ||||||
| Light Bus | 79,805 | 100,168 | -20.33% | 77,237 | 101,516 | -23.92% |
| Truck | 62,825 | 118,117 | -46.81% | 64,727 | 118,105 | -45.20% |
| Pickup | 63,496 | 68,268 | -6.99% | 62,872 | 67,906 | -7.41% |
| SUV | 75,468 | 53,096 | 42.14% | 77,172 | 53,481 | 44.30% |
| Total | 281,594 | 339,649 | -17.09% | 282,008 | 341,008 | -17.30% |
| By Region | ||||||
| China | 281,594 | 339,649 | -17.09% | 282,008 | 341,008 | -17.30% |
Reasons for the year-on-year change of more than 30%
□√Applicable □Not Applicable
The 45.20% year-on-year decline in truck sales was mainly due to a decline inthe industry.The 44.30% year-on-year increase in SUV sales was mainly due to the increasein overseas sales.Component Kit System ConstructionJMC owns in-house R&D and manufacturing capability for key components, withsuch important components as engine, body parts, frame, wheel and front axle,etc. developed and manufactured independently. For some other keycomponents, JMC keeps strategic cooperation with industry leading suppliers,e.g. Bosch, Garrett, Yunnei Power, and ZF. JMC has established strategiccooperation with such leading enterprises as CATL and Suzhou Inovance onnew energy development. For smart connectivity, JMC conducted diversifiedcooperation with such giants as Tencent, Hengrun, IFLYtek and Desay SV, etc.for ecology development. With the vision of achieving customer success, JMCcooperates with suppliers to create a customer-centered vehicle experience andstrives to build a sustainable agile supply system. Through innovative thinkingand digitalization, JMC has established a complete supplier access, capabilityimprovement and supplier control mechanism from the perspectives oftechnology, quality, cost, delivery and service, thus effectively promoting thecompetitiveness of the supply system.
Production and operation of auto parts during the reporting period
□Applicable □√Not Applicable
The Company carries out auto finance business
□Applicable □√Not Applicable
The Company carries out new energy vehicle related business
□√Applicable □Not Applicable
Production and operation of new energy vehicles and parts
| Product Category | Capacity (Unit) | Production Volume (Unit) | Sales Volume (Unit) | Revenue (RMB) |
| New Energy Bus Series | 5,000 | 1,552 | 1,411 | 173,075,069 |
| New Energy Passenger Vehicles and Pickup | 35,000 | 366 | 363 | 67,068,224 |
| New Energy Truck | 20,000 | 1,647 | 1,655 | 233,591,090 |
| Total | 60,000 Note: all new energy vehicles are collinear with corresponding fuel vehicles. | 3,565 | 3,429 | 473,734,383 |
New energy vehicle SubsidyIn 2022, JMC received a subsidy of RMB 104,510 thousand for new energyvehicles.
3. Core Competitiveness Analysis
The Company is a modern Sino-foreign joint venture that integrates automobileresearch and development, manufacturing and sales. It is a pioneer in theChinese auto industry that provides excellent products and solutions for theintelligent logistics field by relying on the market leadership and advancedtechnology of light commercial vehicles. It is also a provider of Ford value SUVs.It owns the titles of National High-tech Enterprise, National Innovation PilotEnterprise, National Enterprise Technology Center, National Industrial DesignCenter, National Intellectual Property Demonstration Enterprise, and NationalVehicle Export Base. It has been ranked among the top 100 most valuableautomobile brands in the world for many consecutive years. In terms of segment,JMC light bus’s market share ranked No.1, Pickup’s market share ranked No.2and light truck’s market share ranked No.5.
As the top light bus brand in China, JMC has always been customer-oriented andlaunched the light bus portfolio, including new Transit + new-generation TransitPro and Teshun + Fushun, which occupies an important position in logistics,passenger transport, household, refit and other fields. The latest JMC Fushun onthe market, with joint venture quality, super space, super power, rear driveadvantage and friendly price, has become a hot selling model of logistic vehicle.
JMC light truck adheres to the business and service concept of “customer-centered”, constantly improves product competitiveness, and effectivelyresponds to the new policy of blue license plate, with customer experienceimproved and sales channels optimized. The newly launched “Kaiyun +”, a new-generation light truck model, has comprehensive upgrade in exterior, interior,power, safety and fuel economy, etc. Nine models have been available accordingto the customer demands, they are engineering model, fruit and vegetable model,building materials model, mountain model, supermarket model, seafood model,moving model, express model and cold chain model.
JMC Pickup, as a leading brand in the market, adheres to the customer-centereddesign concept in product research and development. JMC launched Yuhu 7SVO product to meet customer demands for the appearance, interior and comfortof medium and high-end Pickup. Baodian product line launched low platform andflat bottom box models to satisfy the use habits of different industry customers onthe rear bucket. At the same time, through “JFX Yuhu life family” activities totransmit diversified Pickup life concept and to continuously promote ChinesePickup culture, the sense of social responsibility of Pickup industry leading brandhas been displayed.
4. Core Business Analysis
I. Summary
In 2022, under the economic downward pressure, high raw material prices, lackof core and power restriction, and poor logistics, etc., have a significant impacton the automobile terminal consumption market, with weak market performanceand weak growth. In the whole year, the vehicle sales in China reached 26.86million, up 2.1% year on year, including 23.56 million passenger vehicles; growthof 9.5% year on year; commercial vehicles sold 3.3 million units, down 31.2%year on year.
During the reporting period, in order to respond to the intensified competition,stricter homologation requirement and cost increase, JMC has been dedicated inimproving the product quality, promoting new product development, controllingoperation cost and enhancing production efficiency. At the same time, JMClaunched a series of marketing proposals to actively cope with market risks. In2022, JMC achieved sales volume of 282,008 units, including 77,237 light buses,64,727 trucks, 62,872 Pickups and 77,172 SUVs, with YOY decrease of 17.30%.In 2022, the total production volume was 281,594 units, including 79,805 lightbuses, 62,825 trucks, 63,496 Pickups and 75,468 SUVs, with YOY decrease of
17.09%.
In 2022, the operation revenue reached RMB 30.1 billion, down 14.54% year onyear. The operation cost was RMB 25,812 million, down 14.29% year on year.The marketing expense was RMB1,445 million, with YOY decrease of 5.67%.The administration expense was RMB 965 million, down 16.27% year over year.R&D cost was RMB 1,483 million, down 13.21% year on year. The financialexpense was RMB -164 million, up by 44.58% year over year.
II. Revenue and Cost(a) Composition of Sales Revenue
Unit: RMB
| 2022 FY | 2021 FY | YOY change (%) | |||
| Amount | Proportion (%) | Amount | Proportion (%) | ||
| Revenue | 30,100,283,842 | 100% | 35,221,306,472 | 100% | -14.54% |
| By Industry | |||||
| Automobile Industry | 30,100,283,842 | 100% | 35,221,306,472 | 100% | -14.54% |
| By Products | |||||
| Vehicle | 27,069,207,538 | 89.93% | 32,317,182,099 | 91.75% | -16.24% |
| Components | 2,412,993,540 | 8.02% | 2,101,505,690 | 5.97% | 14.82% |
| Automobile Maintenance Services | 110,324,841 | 0.37% | 111,360,531 | 0.32% | -0.93% |
| Material & Others | 507,757,923 | 1.68% | 691,258,152 | 1.96% | -26.55% |
| By Region | |||||
| China | 30,100,283,842 | 100% | 35,221,306,472 | 100% | -14.54% |
| Sales model | |||||
| Distribution | 28,995,566,644 | 96.33% | 33,828,173,736 | 96.04% | -14.29% |
| Direct selling | 1,104,717,198 | 3.67% | 1,393,132,736 | 3.96% | -20.70% |
Number of dealers: at present, there are more than 400 first-level dealers, andthe total number of dealers is more than 1,000.
(b) Reach to 10% of Revenue or Profit by Industry, Product, Region or Sales
Model
□√Applicable □Not Applicable
Unit: RMB
| Turnover | Cost | Gross Margin | YOY turnover change (%) | YOY Cost Change (%) | YOY gross margin change (points) | |
| By Industry | ||||||
| Automobile Industry | 30,100,283,842 | 25,812,264,868 | 14.25% | -14.54% | -14.29% | -0.24% |
| By Products | ||||||
| Vehicle | 27,069,207,538 | 23,355,537,374 | 13.72% | -16.24% | -16.02% | -0.23% |
| By Region | ||||||
| China | 30,100,283,842 | 25,812,264,868 | 14.25% | -14.54% | -14.29% | -0.24% |
If the Company’s core business scope is adjusted during the reporting period, theCompany’s core business data of last year need to be adjusted per the scope inthis year
□Applicable □√Not Applicable
(c) Whether the Company’s Goods Revenue Higher Than Service Revenue
□√Yes □No
| Industry | Item | Unit | 2022 | 2021 | Change (%) |
| Automobile | Sales Volume | unit | 282,008 | 341,008 | -17.30% |
| Production Volume | unit | 281,594 | 339,649 | -17.09% | |
| Inventory Volume | unit | 9,113 | 10,188 | -10.55% |
Explanation on YOY change of over 30%
□Applicable □√Not Applicable
(d) Execution of the Company’s Signed Major Sales Contracts and MajorPurchase Contracts as of the Reporting Period
□Applicable □√Not Applicable
(e) Composition of Operating CostProduct categories
Unit: RMB
| Product | Item | 2022 FY | 2021 FY | YOY Change（%） | ||
| Cost | Proportion (%) | Cost | Proportion (%) | |||
| Vehicle | Cost | 23,355,537,374 | 90.48% | 27,809,982,305 | 92.34% | -16.02% |
| Components | Cost | 1,872,040,360 | 7.25% | 1,557,352,106 | 5.17% | 20.21% |
| Automobile Maintenance Services | Cost | 109,409,795 | 0.42% | 118,486,239 | 0.39% | -7.66% |
| Material & Others | Cost | 475,277,339 | 1.85% | 631,633,717 | 2.10% | -24.75% |
(f) Whether the Consolidated Scope was Changed During the Reporting Period
□Yes □√No
(g) Major Change or Adjustment on Business, Products or Services During theReporting Period
□Applicable □√Not Applicable
(h) Main Customers and Suppliers
Main Customers
| Total sales value to top 5 customers（RMB） | 8,458,719,170 |
| Accounted for the proportion of JMC’s total annual turnover | 28.10% |
| Included related party transaction accounted for the proportion of JMC’s total annual turnover | 21.19% |
Top 5 Customers
| No. | Name of the Customer | Sales Value (RMB) | Percentage of JMC’s Total Turnover (%) |
| 1 | Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. | 5,907,094,789 | 19.62% |
| 2 | Chengli Special Automobile Co., Ltd. | 823,303,887 | 2.74% |
| 3 | Beijing Jinglingshun Auto Sales Company | 661,151,507 | 2.20% |
| 4 | Zhejiang Jiangling Motors Sales Company | 594,285,016 | 1.97% |
| 5 | Jiangxi JMCG Specialty Vehicles Sales Service Co., Ltd. | 472,883,971 | 1.57% |
| Total | 8,458,719,170 | 28.10% |
Other introduction to main customers
□√Applicable □Not Applicable
Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. and Jiangxi JMCG SpecialtyVehicles Sales Service Co., Ltd. are related parties of the Company.
Main Suppliers:
| Total purchase value from top 5 suppliers（RMB） | 4,170,325,071 |
| Accounted for the proportion of JMC’s total annual purchase amount | 18.26% |
| Included related party transaction accounted for the proportion of JMC’s total annual purchase amount | 14.62% |
Top 5 Suppliers:
| No. | Name of the Supplier | Purchase Value (RMB) | Percentage of JMC’s Total Annual Purchase Amount (%) |
| 1 | Nanchang Jianglin Huaxiang Automobile Parts Co., Ltd. | 924,968,624 | 4.05% |
| 2 | Magna PT Powertrain (Jiangxi) Co., Ltd. | 893,746,762 | 3.91% |
| 3 | Nanchang Baojiang Steel Processing Distribution Co., Ltd. | 853,482,030 | 3.74% |
| 4 | Bosch Auto Diesel System (Wuxi) Company | 830,381,102 | 3.64% |
| 5 | Jiangxi Jiangling Chassis Co., Ltd. | 667,746,553 | 2.92% |
| Total | 4,170,325,071 | 18.26% |
Other introduction to main suppliers
□√Applicable □Not Applicable
Nanchang Jianglin Huaxiang Automobile Parts Co., Ltd., Magna PT Powertrain(Jiangxi) Co., Ltd., Nanchang Baojiang Steel Processing Distribution Co., Ltd.,and Jiangxi Jiangling Chassis Co., Ltd. are related parties of the Company.
III. Expense
Unit: RMB
| 2022 | 2021 | YOY Change | Description of significant Changes | |
| Distribution Expenses | 1,444,894,711 | 1,531,808,043 | -5.67% | |
| Administrative Expenses | 964,786,345 | 1,152,218,590 | -16.27% | |
| Finance Income-net | -163,907,346 | -295,755,557 | 44.58% | Mainly due to the decreased interest income form bank deposits and the |
| increased interest expense | ||||
| R & D Expenses | 1,483,329,630 | 1,709,014,171 | -13.21% |
IV. Research & Development
| Name of main R&D project | Project purpose | Project progress | Goals to be achieved | The expected impact on the Company's future development |
| PV product hybrid power and BEV project | Enhance the competitiveness of Jiangling Ford passenger vehicle products, and meet the requirements of future passenger vehicle fuel consumption regulations and double points policy | It is under development and will begin production in 2024-2025. | Increase the Company's operating revenue. | |
| Light bus product replacement project | Enhance the dual brand competitiveness of the Company’s light bus products, and maintain the first position of light bus in the Chinese market. | The self-owned brand replacement products have been launched in 2022, and the Fordbrand replacement products will be lanched in the second half of this year. | Increase the Company's operating revenue. | |
| Light truck product replacement project | Enhance the competitiveness of the Company’s light truck products. | The conventional vehicle had been launched in 2022, and the electric platform products will be launched this year. | Increase the Company's operating revenue. | |
| Pickup product replacement project | Enhance the competitiveness of the Company’s pickup products. | It is under development, and the replacement of all Pickup products will be implemented in 2023-2025. | Increase the Company's operating revenue. |
Company R & D personnel
| 2022 | 2021 | Change(%) | |
| R&D staff (person) | 2,350 | 2,315 | 1.51% |
| R&D staff as % of total employees | 19.05% | 17.90% | 1.15% |
| Educational structure of R&D personnel | |||
| Undergraduate | 1,651 | 1,609 | 2.60% |
| Master | 554 | 559 | -0.90% |
| Age composition of R&D personnel | |||
| Under the age of 30 | 533 | 602 | -11.50% |
| 30 ~ 40 years old | 1,481 | 1,382 | 7.20% |
R&D Investment
| 2022 | 2021 | Change(%) | |
| R&D investment (RMB) | 2,018,500,532 | 1,886,139,707 | 7.02% |
| R&D investment as % of revenue | 6.71% | 5.36% | 1.35% |
| Capitalization of R&D investment | 535,170,902 | 177,125,536 | 202.14% |
| Capitalization of R&D investment as % of R&D investment | 26.51% | 9.39% | 17.12% |
Causes and impacts of major changes in the composition of R&D personnel
□Applicable □√Not Applicable
Reason for the substantial change of R&D investment as % of revenue
□Applicable □√Not Applicable
Reason and rationality of the substantial change in the capitalization rate of R &D investment
□√Applicable □Not Applicable
The change was due to an increase in the amount of R&D investment eligible forcapitalization in this year.Please refer to the Note 2 (14) (e) research and development, and Note 4 (17)Intangible assets/Development expenditures of the notes to the consolidatedfinancial statements in the Chapter X Financial Statements for details.
V. Cash Flow Analysis
Unit: RMB
| Item | 2022 | 2021 | Change (%) |
| Sub-total of cash inflows | 31,614,927,049 | 39,740,902,264 | -20.45% |
| Sub-total of cash outflows | 33,133,501,001 | 37,980,709,254 | -12.76% |
| Net cash flows generated from operating activities | -1,518,573,952 | 1,760,193,010 | -186.27% |
| Sub-total of cash inflows | 1,407,222,333 | 2,915,954,321 | -51.74% |
| Sub-total of cash outflows | 1,496,365,812 | 2,994,592,220 | -50.03% |
| Net cash flows generated uesd in investing activities | -89,143,479 | -78,637,899 | 13.36% |
| Sub-total of cash inflows | 4,731,667,661 | 1,484,497,639 | 218.74% |
| Sub-total of cash outflows | 4,149,807,890 | 4,718,956,565 | -12.06% |
| Net cash flows generated from financing activities | 581,859,771 | -3,234,458,926 | 117.99% |
| Net decrease in cash and cash equivalents | -1,025,857,660 | -1,552,903,815 | -33.94% |
Explanation on the major factors regarding major change of related data
□√Applicable □Not Applicable
Year on year decrease of the Net cash flows generated from operating activities
was due to the reduced cash received for goods sold as a result of lower salesrevenue.
Year on year increase of the net cash flows generated from financing activitieswas mainly due to the increase in borrowing this year and the dividend paymentof RMB 3 billion in 2021.
Year on year decrease of the net decrease in cash and cash equivalents wasmainly attributable to the increase in net cash flows generated from financingactivities.
Explanation on significant difference between net cash generated from operatingactivities and net profit during the reporting period.
□√Applicable □Not Applicable
Please refer to the Note 4 (57) supplementary information to the cash flowstatement of the notes to the consolidated financial statements in the Chapter XFinancial Statements for details.
5. Non- core business analysis
□Applicable □√Not Applicable
6. Analysis of Assets and Liabilities
I. Major changes
Unit: RMB
| Asset item | End of 2022 | Beginning of 2022 | YOY | ||
| Proportion change | |||||
| Amount | Proportion | Amount | Proportion | (Points) | |
| Cash and cash equivalents | 8,604,977,725 | 31.33% | 9,569,051,314 | 36.30% | -4.97% |
| Accounts receivables | 4,245,541,752 | 15.46% | 2,994,798,227 | 11.36% | 4.10% |
| Inventories | 2,129,040,820 | 7.75% | 1,974,728,632 | 7.49% | 0.26% |
| Long-term equity investments | 248,482,822 | 0.90% | 257,251,255 | 0.98% | -0.08% |
| Fixed assets | 5,446,384,369 | 19.83% | 6,029,302,031 | 22.87% | -3.04% |
| Construction in progress | 718,612,190 | 2.62% | 448,338,672 | 1.70% | 0.92% |
| Right-of-use assets | 233,622,890 | 0.85% | 306,225,810 | 1.16% | -0.31% |
| Short-term borrowings | 1,100,000,000 | 4.00% | 300,000,000 | 1.14% | 2.86% |
| Contract liabilities | 152,065,025 | 0.55% | 272,274,177 | 1.03% | -0.48% |
| Long-term borrowings | 20,858,057 | 0.08% | 2,087,537 | 0.01% | 0.07% |
| Lease liabilities | 193,090,351 | 0.70% | 263,409,414 | 1.00% | -0.30% |
Foreign assets account for a relatively high proportion
□Applicable □√Not Applicable
II. The fair value of the assets and liabilities.
Unit: RMB
| Item | financial assets | 1.Trading financial assets (excluding derivative financial assets) | 2.Receivables financing | Subtotal | Financial liabilities |
| Beginning of the period | 100,242,329 | 201,511,670 | 301,753,999 | 0 | |
| Loss/profit in fair value in the period | -242,329 | 0 | -242,329 | 0 | |
| Cumulative changes in fair value recorded into equity | 0 | 0 | 0 | 0 | |
| Impairment in the period | 0 | 0 | 0 | 0 | |
| Purchase in the period | 100,000,000 | 3,664,369,012 | 3,764,369,012 | 0 | |
| Sell in the period | 200,000,000 | 3,489,217,865 | 3,689,217,865 | 0 | |
| Other changes | 0 | 0 | 0 | 0 | |
| End of the period | 0 | 376,662,817 | 376,662,817 | 0 |
Other changeNone.
Whether there is a significant change in the measurement attributes of theCompany's main assets during the reporting period
□Applicable √Not Applicable
III. Restriction on Assets Rights as of the End of the Reporting PeriodThere was no restriction on rights of major assets as of the end of the reportingperiod.
7. Investment Analysis
I. Summary
□Applicable □√Not Applicable
II. Obtained Major Equity Investment during the Reporting Period
□Applicable □√Not Applicable
III. Ongoing Major Non-Equity Investment during the Reporting Period
□Applicable □√Not Applicable
IV. Financial Assets Investment(a) Stock Investment
□Applicable □√Not Applicable
There was no financial assets investment on the reporting period.
(b)Derivative Investment
□Applicable □√Not Applicable
There was no derivative investment on the reporting period.
V. Usage of Raised Fund
□Applicable □√Not Applicable
There was no usage of raised fund on the reporting period.
8. Sales of Major Assets and Equity
I. Sale of Major Assets
□√Applicable □Not Applicable
| Counterparty | Nanchang Land Reserve Center |
| Sold assets | The land and above-ground buildings in the Qingyunpu site |
| Date of sale | June 28, 2022 |
| Transaction price (RMB thousand) | 759,208.3 |
| Net profit contributed by the Assets to the listed company from the beginning of the current period to the selling date (RMB thousand) | 335,000.1 |
| Impact of the sale on the Company | A positive impact on the Company's profits in 2022. |
| Proportion of net profit contributed by assets sale to the total net profit of the listed company | 36.61% |
| Assets sale pricing principle | Evaluation Price |
| Whether it is a related party transaction | No |
| Association with the counterparty | No relationship |
| Whether all the assets involved have been transferred | Yes |
| Whether the claims and debts involved have been completely transferred | Not applicable |
| Whether the plan is implemented as | Yes |
| scheduled, if not, the reason and the measures taken by the company | |
| Date of disclosure | June 30, 2022 |
| Index | The announcement (No. 2022-023) was published on the website: www.cninfo.com.cn. |
II. Sales of Major Equity
□√Applicable □Not Applicable
| Counterparty | Volvo Lastvagnar Aktiebolag |
| Sold equity | 100% equity of JMC Heavy Duty Vehicle Co., Ltd., a wholly owned subsidiary of JMC |
| Date of sale | The deal is still in progress. |
| Transaction price (RMB thousand) | 781,400 |
| Net profit contributed by the equity to the listed company from the beginning of the current period to the selling date | RMB -95,303.30 thousand in 2022. |
| Impact of the sale on the Company | One of the measures to achieve the Company's strategic vision. |
| Proportion of net profit contributed by equity sale to the total net profit of the listed company | The deal is still in progress. |
| Equity sale pricing principle | Public bidding process. |
| Whether it is a related party transaction | No. |
| Association with the counterparty | No relationship. |
| Whether all the equity involved has been transferred | No. |
| Whether the plan is implemented as scheduled, if not, the reason and the measures taken by the company | Yes. |
| Date of disclosure | August 24, 2021 |
| Index | The announcement (No. 2021-047) was published on the website: www.cninfo.com.cn |
9. Analysis of major shareholding companies
□√Applicable □Not Applicable
Operating Results of Main Subsidiaries and Joint-Stock Companies whoseimpact on JMC’s net profit more than 10%
Unit: RMB’000
| Name of companies | Jiangling Motors Sales Corporation, Ltd | JMC Heavy Duty Vehicle Co., Ltd. | Jiangling Ford Motor Technology (Shanghai) Co., Ltd. |
| Type of | Subsidiary | Subsidiary | Holding subsidiary |
| companies | |||
| Main business | Sales of vehicles and service parts. | Production and sales of automobiles, engines and other automotive parts | Engineering and technology research and experimental development, sales of vehicles, new energy vehicles, auto parts, etc. |
| Registered capital | 50,000.00 | 1,323,793.20 | 200,000.00 |
| Assets | 5,227,963.90 | 732,988.60 | 443,233.90 |
| Net assets | 343,011.30 | 696,739.60 | -6,470.50 |
| Turnover | 23,237,876.50 | 325.20 | 124,029.60 |
| Operating profit | 109,559.00 | -96,000.50 | -141,873.10 |
| Net profit | 84,544.20 | -95,303.30 | -106,470.50 |
Acquisition and disposal of the subsidiaries
□Applicable □√Not Applicable
Description of the main holding and participating companiesNone.
10. Structured Entities Controlled by JMC
□Applicable □√Not Applicable
11. Outlook
I. Industry DevelopmentIn 2023, China will continue to adhere to the general tone of seeking progresswhile maintaining stability and vigorously boost market confidence, with thestrategy of expanding domestic demand implemented. China will also activelypromote the overall improvement of economic performance, so as to achieveeffective improvement in quality and reasonable growth in quantity. We believethat with the implementation of relevant supporting policies and measures, wewill further stimulate the vitality of market players and consumers. We are fullyconfident that the economy will improve throughout the year. In addition, the chipshortage and other problems are expected to be greatly alleviated in this year, itis expected that the automobile market will continue to show a stabledevelopment trend in 2023, with growth of about 3%.
Overall market: the sales volume in the whole year is 27.6 million units with YOYgrowth of 3%. The policy of stabilizing growth will help stabilize the growth ofautomobiles and other commodities.
Commercial vehicle market: the sales volume in the whole year is 3.8 millionunits. The emission homologation has been switched. Overloading and over-limitmanagement has been carried out on a regular basis, environmental restrictionson production have been increased, and the commercial vehicle market hasbecome more rational.
Passenger vehicle market: the sales volume in the whole year is 23.8 millionunits. Re-stocking is expected to drive sales growth.
New energy vehicle market: the sales volume in the whole year is 9 million unitswith YOY growth of 35%. Both high supply and demand shall continue theprosperity of new energy vehicles.
II. Company StrategyThe Company adheres to the vision of “becoming leader in light commercialvehicle and provider of Ford value products” and the values of “integrity,dedication, innovation, collaboration”. Commercial vehicles are positioned asintegrated urban and arterial logistics product and service providers to meetcustomer needs by providing customized products and integrated services tocreate a new business concept of “lifelong partner”. Passenger vehicles makebreakthroughs and great development in small and medium-sized markets, andcreate extreme customer experience by providing differentiated products thatmeet customer needs. In the future, JMC will take high-quality development asthe main line, and focus on value with lean operation. The Company will transferfrom the scale expansion model of development to lean value growth model. Atthe same time, JMC will focus on the core business, and be dedicated in the in-depth cultivation of segmentation, with customers as the center, enhancing thewhole value chain market awareness, thus actively making the Company’sproducts into leaders in the market. The Company will also aim at the new trendof the automobile industry, and promote the implementation of the “new fourmodernization” development strategy of “electrification, intelligent connectivity,sharing, and autonomous driving”. JMC will plan in such core fields as newenergy vehicle, intelligent connectivity and autonomous driving, etc. Through theoverall coordination and integration of the four modernization, the Company willaccelerate the construction of future-oriented business ecosystem with globalcompetitiveness.
III. Business PlanIn 2023, the Company plans to achieve the sales volume of 316 thousand unitsand the operation revenue of about RMB 31.6 billion, up 12% and 5%respectively compared with 2022. In order to further improve the managementquality, the Company will devote itself to the following aspects in 2023:、
(1) Continue to consolidate and improve the Company's leading advantagesin the field of light commercial vehicles, improve channel capabilities, andpromote brand upgrading and renewal;
(2) Accelerate the expansion of passenger vehicle business, strengthencustomer experience, enhance the competitiveness of distributors, developinnovative marketing modes, and create the brand image of off-road outdoorlifestyle;
(3) Accelerate the establishment and promotion of new energy brands,accelerate the landing of transport capacity operation, promote online, directsales, private marketing and other diversified marketing methods, and improvethe penetration rate of new energy products;
(4) Strengthen overseas market insight and new product promotion, andcooperate with various resources to expand overseas market;
(5) Always insist on taking customers as the center, deeply understand themarket changes and customer needs, continue to innovate, and cooperate in anefficient way to provide customers with quality products and services;
(6) Solidly promote research and development of new products, manufactureand launch such products with high quality as brand-new Yuhu, new-generationlight bus, high-end Ford Pickup, new-generation light trucks and various newenergy models, to improve product competitiveness;
(7) Continue to promote digital transformation, and use digital marketing toolsto expand channel capabilities and improve customer experience;
(8) Continue to promote cost reduction, efficiency improvement and leanmanagement, build an efficient and agile organization, and lay a solid foundationfor the Company's overall strategic development.
IV. Potential Risks and SolutionsIn 2023, geopolitical conflicts will continue, the risk of world economic contractionwill intensify, and the global economy will face enormous downward pressure.China's economy is expected to pick up on the whole under the general principleof “ensuring stability and pursuing progress while maintaining stability”. However,affected by the international environment and the implementation of domesticpolicies, the speed of economic recovery is uncertain. Under the background ofthe implementation of the two-carbon policy and the acceleration of thetransformation of the New Four Modernizations, the competition pattern of theautomobile industry is becoming increasingly fierce. Meanwhile, the price of rawmaterials is still high, which brings great challenges to the Company's operation.In order to maintain steady growth, the Company will focus on the followingaspects:
(1) Be customer-oriented, make in-depth insight into customer needs andmarket environment changes, explore new business growth points, and seize the
opportunity in the disruptive industry changes;
(2) Continue to accelerate the development and launch of new energyproducts, vigorously expand online marketing and transport capacity operationmode based on the original dealer channels, and become the best partner ofurban green transport capacity;
(3) Break through key overseas strategic markets, adopt dual-brand + dual-channel strategy, and enhance overseas business scale;
(4) Carefully organize and prepare for the launch of new products,continuously improve the brand influence and ensure there is volume just afterlaunch;
(5) Accelerate the digital transformation of the Company, break the dataisolation, realize online products, processes, customers and employees, enhancecustomer experience and improve operation efficiency;
(6) Continue to promote cost reduction, cost control and efficiencyimprovement, and strengthen the management and control of operating cashflow to improve the quality of operation;
(7) Strengthen corporate governance, strictly abide by national laws andregulations, and improve risk assessment and control mechanisms.
The Company will focus on light commercial vehicles with SUVs as the support,further promote scientific and technological innovation and industrialtransformation, stabilize the leading position of light commercial vehicles, andimprove the sales of passenger vehicles. JMC is to strengthen marketdevelopment, promote brand renewal, and continue to consolidate the corecompetitiveness of light commercial vehicles. Channel construction and brandtransformation of passenger vehicles will be accelerated to improve marketawareness and customer experience. We will accelerate the development of newenergy vehicles, vigorously expand overseas export business, strengthen theexisting market, and seek incremental markets. The Company shall expand newbusiness and profit model, and build an ecological platform for future sustainabledevelopment. At the same time it will also focus on the process control andmarketing planning of new programs, so as to achieve the quality, cost andvolume targets. JMC is to accelerate the digital transformation, implement qualityand efficiency improvement actions, improve profitability and create sufficientcash flow to support high-quality development of the Company.
12. External Research, Communication, and Media Interview to the Company
□√Applicable □Not Applicable
| Date | Communication Method | Type of Object | Information Discussed and Materials offered |
| April 15, 2022 | Other | Individual Investors | JMC Operating highlights |
| May 27, 2022 | Other | Individual Investors | JMC Operating highlights |
| September 9, 2022 | Telephone communication | Investment institution | JMC Operating highlights |
| September 23 2022 | Telephone communication | Investment institution | JMC Operating highlights |
Chapter IV Corporate Governance Structure
1. Status of the Corporate Governance in JMC
During the reporting period, the Company strictly abided by the Company Law, theSecurities Law, the Code of Corporate Governance for Listed Companies in China,the Rules Governing Listing of Stock on Shenzhen Stock Exchange, as well asrelevant laws and regulations, to carry out corporate governance activities andcontinued to improve its corporate governance.
Whether there are significant differences between the actual situation of corporategovernance in the company and the laws, administrative regulations and that ofregulations on corporate governance of listed companies promulgated by CSRC
□Yes□√No
There is no significant difference between the actual situation of corporategovernance in JMC and the laws, administrative regulations and that ofregulations on corporate governance of listed companies promulgated by CSRC.
2. Separation between JMC and the Controlling Shareholders and actual controllerin respect of Personnel, Assets and Finance, and Independence concerningOrganization and Business:
(1) With respect to personnel matters, the positions of chairman and president areheld by different individuals; JMC’s senior management do not hold positions otherthan director positions with its controlling shareholders; JMC senior managementpersonnel are paid by JMC; labor, personnel matters and compensationmanagement of JMC are completely independent.
(2) With respect to assets, JMC assets are complete. The assets utilized by JMC,including production system, supporting production system and peripheral facilities,and non-patent technology, are owned and/or controlled by JMC.
(3) With respect to finance, JMC has an independent finance department andindependent accounting system, and has a uniform and independent accountingsystem and financial control system for its branches and subsidiaries. JMC has itsown bank accounts, and there are no bank accounts jointly owned by JMC and itscontrolling shareholders. JMC pays taxes independently in accordance withrelevant laws.
(4) With respect to organization, JMC’s organization is independent, complete andscientifically established with a sound and efficient operating mechanism. Theestablishment and the operation of JMC’s corporate governance are strictlycarried out per the Articles of Association of JMC. Production and administrativemanagement are independent from the controlling shareholders. JMC hasestablished an organization structure that meets the need for ongoingdevelopment.
(5) With respect to business, JMC has independent purchasing, production andsales systems. The purchasing, production and sales of main materials andproducts are carried out through its own purchasing, production & sales functions.JMC is independent from the controlling shareholders in respect to its business,
and has independent and complete business and self-sufficient operatingcapability.
3. Horizontal Competition
□Applicable □√Not Applicable
4 Introduction to the Shareholders’ Meetings Held in the Reporting Period
(1) Index to the Shareholders’ Meeting in the reporting period
In 2022, the Company has hold two Shareholders’ Meetings, and the relevantcontents are as follows:
1. Session of the meeting：2021 Annual Shareholders’ MeetingThe meeting type: annual shareholders’ meetingInvestor participation ratio: 75.15%Convening date: June 24, 2022Disclosure date: June 25, 2022The meeting resolutions:
1. 2021 Work Report of the Board of Directors of JMC;
2. 2021 Work Report of the Supervisory Board of JMC;
3. 2021 Annual Report of JMC and the Extracts from such Annual Report;
4. 2021 Financial Statements of JMC;
5. Proposal on JMC Profit Distribution for Year 2021;
6. Proposal on the Y2022 Routine Related Party Transaction Framework withJMCG Finance Company;
7. Proposal on the Y2022 Routine Related Party Transaction Framework withJMCG and its subsidiaries;
8. Proposal on the Y2022 Routine Related Party Transaction Framework withJiangxi Jiangling Motors Imp. & Exp. Co., Ltd. and its subsidiaries;
9. Proposal on the Y2022 Routine Related Party Transaction Framework with FordMotor Company and its subsidiaries;
10. Proposal on the Y2022 Routine Related Party Transaction Framework withNanchang Baojiang Steel Processing Distribution Co., Ltd.;
11. Proposal on the Y2022 Routine Related Party Transaction Framework withMagna PT Powertrain (Jiangxi) Co., Ltd. (formerly known as “GETRAG (Jiangxi)Transmission Company”)
12. Proposal on the Y2022 Routine Related Party Transaction Framework withJiangxi Huaxiang Auto Components Co., Ltd.;
13. Proposal on the Y2022 Routine Related Party Transaction Framework withJiangxi JMCG Specialty Vehicles Co., Ltd. and its subsidiaries;
14. Proposal on the Y2022 Routine Related Party Transaction Framework withChina South Industries Group Corporation and its subsidiaries;
15. Proposal on the Y2022 Routine Related Party Transaction Framework withJiangxi Jiangling Lear Interior System Co., Ltd.;
16. Proposal on the Y2022 Routine Related Party Transaction Framework withNanchang Faurecia Emissions Control Technologies Co., Ltd.;
17. Proposal on Amendment to the Articles of Association of JMC (Year 2022)
2. Session of the meeting：2022 First Special Shareholders’ MeetingThe meeting type: special shareholders’ meetingInvestor participation ratio: 75.00%Convening date: November 7, 2022
Disclosure date: November 8, 2022The meeting resolutions:
Proposal on Electing Mr. Shengpo Wu as a Director of the Tenth Board ofDirectors of JMC.
(2) Special Shareholders’ Meeting convened by preferred-shareholders whosevoting rights were restored
□Applicable □√Not Applicable
5.Directors, supervisors and senior managers
(1) Basic information
| Name | Position | Gender | Age | Term of Office | Shares at the period-beginning | Stock options | restricted stock | Share Change in the reporting period | Shares at the period-end |
| Qiu Tiangao | Chairman | Male | 56 | 2020.06.19-2023.06.18 | 0 | 0 | 0 | 0 | 0 |
| Shengpo Wu | Vice Chairman | Male | 56 | 2022.11.07-2023.06.18 | 0 | 0 | 0 | 0 | 0 |
| Ryan Anderson | Director | Male | 49 | 2021.10.18-2023.06.18 | 0 | 0 | 0 | 0 | 0 |
| Xiong Chunying | Director & President | Female | 58 | 2021.06.25-2023.06.18 | 1,200 | 0 | 0 | 0 | 1,200 |
| Jin Wenhui | Director & EVP | Male | 55 | 2020.06.19-2023.06.18 | 0 | 0 | 0 | 0 | 0 |
| Yuan Mingxue | Director | Male | 54 | 2021.10.18-2023.06.18 | 0 | 0 | 0 | 0 | 0 |
| Chen Jiangfeng | Independent Director | Male | 43 | 2020.06.19-2023.06.18 | 0 | 0 | 0 | 0 | 0 |
| Wang Yue | Independent Director | Female | 44 | 2020.06.19-2023.06.18 | 0 | 0 | 0 | 0 | 0 |
| Yu Zhuoping | Independent Director | Male | 62 | 2021.10.18-2023.06.18 | 0 | 0 | 0 | 0 | 0 |
| Xiao Hu | Chief supervisor | Male | 54 | 2020.06.19-2023.06.18 | 0 | 0 | 0 | 0 | 0 |
| Zhang Yangyang | Supervisor | Male | 43 | 2021.10.18-2023.06.18 | 0 | 0 | 0 | 0 | 0 |
| Zhang Jian | Supervisor | Male | 53 | 2020.06.19-2023.06.18 | 40 | 0 | 0 | 0 | 40 |
| Ma Jian | Supervisor | Male | 47 | 2022.03.16-2023.06.18 | 0 | 0 | 0 | 0 | 0 |
| Li Yanling | Supervisor | Female | 45 | 2022.03.16-2023.06.18 | 0 | 0 | 0 | 0 | 0 |
| Ding Wenmin | EVP | Male | 50 | 2020.06.19-2023.06.18 | 0 | 0 | 0 | 0 | 0 |
| Joey Zhu | CFO | Male | 40 | 2021.10.01-2023.06.18 | 0 | 0 | 0 | 0 | 0 |
| Erik Hermann | VP | Male | 58 | 2021.02.01-2023.06.18 | 0 | 0 | 0 | 0 | 0 |
| Wu Xiaojun | VP | Male | 48 | 2020.06.19-2023.06.18 | 0 | 0 | 0 | 0 | 0 |
| Xu Lanfeng | VP &Board | Female | 53 | 2021.04.01- | 0 | 0 | 0 | 0 | 0 |
| Secretary | 2023.06.18 | ||||||||
| Liu Rangpo | VP | Male | 49 | 2021.04.01-2023.06.18 | 0 | 0 | 0 | 0 | 0 |
| Wu Jiehong | VP | Female | 46 | 2021.10.01-2023.06.18 | 0 | 0 | 0 | 0 | 0 |
| Yang Shenghua | VP | Male | 42 | 2021.12.01-2023.06.18 | 0 | 0 | 0 | 0 | 0 |
| Sam lo | VP | Male | 43 | 2022.08.01-2023.06.18 | 0 | 0 | 0 | 0 | 0 |
| Zeng Fafa | VP | Male | 44 | 2022.08.01-2023.06.18 | 0 | 0 | 0 | 0 | 0 |
| Anderson Liu | VP | Male | 50 | 2022.11.25-2023.06.18 | 0 | 0 | 0 | 0 | 0 |
| Manto Wong | Ex-Vice Chairman | Male | 60 | 2021.06.25-2022.11.06 | 0 | 0 | 0 | 0 | 0 |
| Chen Guang | Ex-Supervisor | Male | 49 | 2020.06.19-2022.03.15 | 0 | 0 | 0 | 0 | 0 |
| Ding Zhaoyang | Ex-Supervisor | Male | 53 | 2020.06.19-2022.03.15 | 20 | 0 | 0 | 0 | 20 |
| Liu Shuying | Ex-VP | Female | 60 | 2020.06.19-2022.05.31 | 0 | 0 | 0 | 0 | 0 |
| Jerry Lin | Ex-VP | Male | 46 | 2020.08.01-2022.07.31 | 0 | 0 | 0 | 0 | 0 |
| Xiang Dongping | Ex-VP | Male | 47 | 2021.09.01-2022.11.24 | 0 | 0 | 0 | 0 | 0 |
| Total | — | — | — | — | 1260 | 0 | 0 | 0 | 1260 |
Whether there are any outgoing Directors and Supervisors and the dismissal ofsenior management personnel during the reporting period?
□√Yes □No
Changes of Directors, Supervisors and Senior Management
□√Applicable □Not Applicable
| Name | Position | Status | Date | Reason |
| Shengpo Wu | Vice Chairman | elected | 2022.11.07 | Work need. |
| Ding Wenmin | EVP | employment | 2022.06.01 | Appointment due to work need. |
| Sam Lo | VP | employment | 2022.08.01 | Appointment due to work need. |
| Zeng Fafa | VP | employment | 2022.08.01 | Appointment due to work need. |
| Anderson Liu | VP | employment | 2022.11.25 | Appointment due to work need. |
| Manto Wong | Ex-Vice Chairman | Leave | 2022.11.06 | Work rotation. |
| Chen Guang | Ex-Supervisor | Leave | 2022.03.15 | Work rotation. |
| Ding Zhaoyang | Ex-Supervisor | Leave | 2022.03.15 | Work rotation. |
| Liu Shuying | Ex-VP | Leave | 2022.05.31 | Retired |
| Jerry Lin | Ex-VP | Leave | 2022.07.31 | Work rotation. |
| Xiang Dongping | Ex-VP | Leave | 2022.11.24 | Work rotation. |
(2). Employment
The current Directors, Supervisors and Senior Executives’ professionalbackground, main working experience and main responsibilities in the Company:
Directors:
Mr. Qiu Tiangao, born in 1966, holds a Bachelor Degree in MechanicalManufacturing and a Master Degree in Industrial Engineering from HuazhongUniversity of Science and Technology, and is Chairman of JMCG, Chairman ofNanchange Jiangling Investment Co., Ltd., and Chairman of JMC. Mr. QiuTiangao held various positions including General Manager, Chairman ofNanchang Gear Co., Ltd., Chairman of Jiangxi JMCG Gear Co., Ltd., VicePresident of Jiangling Motor Holdings Co., Ltd., and Director & General Managerof JMCG.
Mr. Shengpo Wu, born in 1966, holds a Bachelor’s Degree in Thermal EnergyEngineering from Tsinghua University in Beijing and Master’s Degrees inMechanical Engineering and Information Management, respectively, from theUniversity of Nebraska-Lincoln and the Keller Graduate School of Management ofDeVry University, and is a Group Vice President of Ford, President and ChiefExecutive Officer of Ford China, and Vice Chairman of JMC. Mr. Shengpo Wuheld various positions including Vice President and Regional General Manager forHoneywell Process Solutions in Greater China, President and CEO of Osram’sAsia-Pacific business, President, Asia Pacific, and a member of the GlobalExecutive Committee for Whirlpool Corporation, Managing Director and ChiefOperating Officer of Ford China.
Mr. Ryan Anderson, born in 1973, holds a Bachelor’s Degree in Economics fromUniversity of Chicago and a Master’s Degree in Business Administration fromUniversity of Michigan - Ann Arbor, and is Director and CFO of Ford Motor (China)Ltd., Director of JMC, Director of Chang’an Ford Automobile Limited and FuqiTrading (Shanghai) Ltd., and Chairman of Ford Electric Mache Technology(Nanjing) Co., Ltd. Mr. Ryan Anderson has held various positions includingTreasurer of Ford Europe, Product Development Controller, Marketing & SalesController of Ford Asia Pacific, Director of Corporate Financial Planning andAnalysis for Ford Motor Company.
Ms. Xiong Chunying, born in 1964, senior engineer, holds a Bachelor Degree inAutomobile Engineering from Jiangsu Engineering College, a Master Degree inIndustrial Economics from Jiangxi University of Finance and Economics and anEMBA Degree from China Europe International Business School, and is Presidentand a Director of JMC. Ms. Xiong Chunying held various positions including Chiefof Quality Management Department, Assistant to the President, Vice President,President, Executive Vice President, First Executive Vice President, Director forJMC.
Mr. Jin Wenhui, born in 1967, senior engineer, holds a Bachelor’s Degree inMechanical Manufacturing, a Master’s Degree in Mechanical Engineering fromHuazhong University of Science and Technology and an EMBA Degree in ChinaEurope International Business School, and is Director & First Executive VicePresident of JMC, in charge of marketing sales & service, and assist the Presidentto manage the Company. Mr. Jin Wenhui held various positions including Chief of
Manufacturing Department, Assistant to the President, Vice President for JMC,Director, General Manager of JMCG Jingma Motors Co., Ltd., and Executive ViceGeneral Manager of Jiangxi-Isuzu Motors Co., Ltd., and Executive Vice Presidentof JMC.
Mr. Yuan Mingxue, born in 1968, holds a Bachelor’s Degree in Auto Engineeringfrom Beijing Institute of Technology and an EMBA from China Europe InternationalBusiness School, and is Deputy Secretary of the Party Committee, Chairman ofthe Labor Union for Chongqing Chang’an Automobile Company Limited, andDirector of JMC. Mr. Yuan Mingxue has held various positions including Assistantto the President of Chang’an Auto and Executive Vice President of JianglingHoldings Limited Company, Assistant to the President and Director of StrategyPlanning Department for Chang’an Auto, Assistant to the President and Director ofOverseas Development Department for Chang’an Auto, Vice President, ExecutiveVice President of Chang’an Auto.
Mr. Chen Jiangfeng, born in 1979, holds a Bachelor’s Degree and Master’sDegree in Law from International Law Department, Foreign Affairs College, and isSenior Deputy General Counsel & Executive Director of Gilead (Shanghai)Pharmaceutical Technology Co., and an Independent Director of JMC. Mr. ChenJiangfeng has held various positions including Legal Counsel of Ford Motor (China)Ltd., Legal Counsel of Ford Motor Research & Engineering (Nanjing) Co., Ltd./Chang’an Ford Mazda Automobile Corporation, Ltd., Nanjing Company/Chang’anFord Mazda Engine Company, Ltd., Senior Legal Counsel & Compliance Officer ofFord Asia Pacific & Africa, Senior Legal Counsel of BMW China AutomotiveTrading Ltd., and Member of China Country Council, Head of legal, Director,Merck Healthcare China.
Ms. Wang Yue, born in 1978, holds a Bachelor’s Degree in Accountancy fromHenan University, a Master’s Degree in Accountancy from Zhongnan University ofEconomics and Law, and a Doctor’s Degree in Accountancy from ShanghaiUniversity of Financial and Economics, and is an Associate Professor of School ofAccountancy for Shanghai University of Financial and Economics, an IndependentDirector of JMC, an Independent Director of Shanghai Xinhua Media Co., Ltd., anIndependent Director of Zhuhai Letong Chemical Co., Ltd., an IndependentDirector of Jiangsu Hongde Special Components Co., Ltd., and an IndependentDirector of Guangdong Yangshan United Precision Manufacturing Co., Ltd. Ms.Wang Yue has served as Research Assistant at The Hong Kong PolytechnicUniversity and China Europe International School, and during 2012~2013, servedas Visiting Scholar at Zimmerman Center for University of Illinois at Urbana-Champaign.
Mr. Yu Zhuoping, born in 1960, holds a Bachelor's Degree in MechanicalEngineering and a Master's degree in Mechanical Engineering from TongjiUniversity and a Doctor's Degree in Automotive Engineering from TsinghuaUniversity, and is Director of Collaborative Innovation Center for Intelligent EnergyVehicles of Tongji University, Chairman of Tongji Automobile Design andResearch Institute Co., Ltd., Chairman of Nanchang Jiling New EnergyTechnology Co. Ltd., a Director of Shanghai Motor Vehicle Inspection Certification& Tech Innovation Center Co., Ltd., a Director of Beijing National HydrogenZhonglian Hydrogen Energy Technology Research Institute Co., Ltd., Chairman
and General Manager of Shanghai Intelligent New Energy Vehicle Science andTechnology Innovation Function Platform Co., Ltd., a Counsellor of ShanghaiMunicipal People's Government, a Vice President of China Society of AutomotiveEngineers, a Non-Executive Director of Huazhong In-Vehicle Holdings CompanyLimited, a Director of Appotronics Corporation Limited, an Independent Director ofShanghai Haili (Group) Co., Ltd., an Independent Director of Weichai Power Co.,Ltd., an Independent Director of Ningbo Shenglong Automotive Powertrain SystemCo., Ltd., an Independent Director of Huayu Automotive Systems Co., Ltd and anIndependent Director of JMC. Mr. Yu Zhuoping held various positions includingDirector of School of Mechanical Engineering, Executive Deputy Director of NewEnergy Vehicle Engineering Center, Executive Vice Dean, Dean of School ofAutomotive Studies for Tongji University, and Assistant to the President of TongjiUniversity.
Supervisors:
Mr. Xiao Hu, born in 1968, holds a Bachelor’s Degree in Radio from InformationScience & Electronic Engineering Department of Zhejiang University, and is amember of the Standing Committee of the CPC, the secretary of DisciplineInspection Commission and Chairman of Supervisory Board for JMCG, and ChiefSupervisor of JMC. Mr. Xiao Hu has served as a cadre in the General Office of theNanchang Municipal People's Government, Deputy Director of the Office of theWorking Committee of the Nanchang Hi-tech Industrial Development Zone, deputydirector of the Software Industry Office of the Nanchang Hi-tech IndustryDevelopment Zone Administrative Committee, Deputy Head of the OrganizationDepartment of the Working Committee of Nanchang Hi-tech Industry DevelopmentZone, Deputy Director of the Personnel and Labor Bureau of the Nanchang Hi-tech Industry Development Zone Administrative Committee, Head of theOrganization Department of the Working Committee of Nanchang Hi-tech IndustryDevelopment Zone, and the Director of the Personnel Bureau of the Nanchang Hi-tech Industry Development Zone Administrative Committee.
Mr. Zhang Yangyang, born in 1979, holds a LLB Degree in International Law fromChina Foreign Affairs University and a LLM Degree from the University ofMichigan Law School (Ann Arbor), is qualified to practice law in People’s Republicof China and in the State of New York, the United States of America, and iscurrently serve as a Director and General Counsel of Ford Motor (China) Ltd.,Principle of Beijing Branch for Ford Motor (China) Ltd., a Supervisory of FordElectric Mache Technology (Nanjing) Co., Ltd., a Supervisor of Ford ElectricMache Auto Sales (Shanghai) Co., Ltd and a Supervisor of JMC. Mr. ZhangYangyang previously assumed a series of legal related positions within Fordincluding Managing Counsel for Ford China and ASEAN region, Senior Counselfor Ford China Operations, etc.
Mr. Zhang Jian, born in 1969, holds a College Degree in Secretarial Professionalfrom North China University of Technology, and is Chairman of JMCG LaborUnion, Chairman of Supervisor Board of Nanchang Jiangling Investment Co., Ltd.,and a Supervisor of JMC. Mr. Zhang Jian held various positions includingSecretary of Chairman and Deputy Director of Office for JMC, Director of Office,Director of Communist Party Office, Chief of Publicity Department for JMCG,Assistant to General Manager of JMCG, and Senior Vice Chairman of JMCGLabor Union.
Mr. Ma Jian, born in 1975, holds a College Degree in Mechanical & ElectricalEngineering from Nanchang University of Aeronautical Technology, a MasterDegree in Mechanical Engineering from Huazhong University of Science andTechnology, and is a Supervisor and Chief of Manufacturing Department for JMC.Mr. Ma Jian held various positions including Lead Engineer, Assistant to the Chief,Deputy Chief of Manufacturing Department for JMC, Director of Nanchang factoryfor Getrag Powertrain (Jiangxi) Co. Ltd., and Director of Nanchang Factory andDirector of DCT Factory for Magna Powertrain (Jiangxi) Co. Ltd.
Ms. Li Yanling, born in 1977, holds a College Degree in Industrial and TradeEnglish from Nanchang University of Aeronautical Technology, a Bachelor Degreein English from Jiangxi Normal University, and is a Supervisor and Deputy Chief ofPublic Relationship Department for JMC. Ms. Li Yanling held various positionsincluding Assistant to Ford Quality Expert of Quality Control Department, Assistantto Ford Expert of Public Relationship and Legal Affairs Department, ExecutiveAssistant to President, Chief of Translation Office, and Deputy Chief of PublicRelationship Department for JMC.
Senior management:
Ms. Xiong Chunying, please refer to the part of Directors for her resume.
Mr. Jin Wenhui, please refer to the part of Directors for his resume.
Mr. Ding Wenming, born in 1972, holds a Bachelor’s Degree in AutomobileExertion from Wuhan University of Technology, and is an Executive VicePresident of JMC, in charge of the Company's product research and development.Mr. Ding Wenming held various positions including Deputy Chief of ProductDevelopment Center, Chief of Product Planning & Program ManagementDepartment, and Assistant to the President for JMC, Vice President of JMC.
Mr. Joey Zhu, born in 1982, holds a Bachelor’s Degree in Accounting from NanjingUniversity and a Master’s Degree in Financial Engineering from NanyangTechnological University, and is CFO of JMC. Mr. Joey Zhu held various positionsincluding PD Profit Planning Manager, Profit Analysis Manager, Admin & ITController, and PD Finance Controller for Ford Asia & Pacific, Deputy CFO ofCEVT, Sweden, Finance Controller of Byton NEV Company, Senior BusinessDevelopment Manager, CFO of BEV Division, and BEV Strategic PartnershipDevelopment Director for Ford China.
Mr Eric Hermann, born in 1964, holds a Bachelor’s Degree in EngineeringMechanical and a Master’s Degree in Engineering Mechanical from University ofMichigan, and is a Vice President of JMC, in charge of the Company's productresearch and development. Mr. Eric Hermann held various positions in Ford MotorCompany including Light Truck Exhaust Design Engineer, Vehicle NVHSupervisor, VE Launch Leader, Exhaust, AIS & Clutch Supervisor, AIS, Cooling,Exhaust & CAE Manager, BoF Cooling & Mounts Manager, Unibody Exhaust &AIS Manager, and Global AIS Manager, as well as the Director of PowertrainEngineering Department and Assistant President for JMC.
Mr. Wu Xiaojun, born in 1974, holds a Bachelor’s Degree from Wuhan Universityof Technology and a MBA from Jiangxi University of Finance and Economics, andis a Vice President of JMC, CEO of New Energy Division for JMC, ExecutiveDirector and General Manager of Jiangling Heavy Vehicle Co., Ltd., in charge ofthe new energy business of commercial vehicles for the Company. Mr. Wu Xiaojunheld various positions including Chief of Quality Department, Assistant to thePresident for JMC, and Executive Deputy General Manager of JMC Heavy DutyVehicle Co., Ltd.
Ms. Xu Lanfeng, born in 1969, holds a Bachelor’s Degree in Forging Technologyand Equipment from Jiangxi Industry University and a MBA from University ofInternational Business and Economics, and is a Vice President and the BoardSecretary of JMC, in charge of the Company’s human resources and relevantduties of Board Secretary. Ms. Xu Lanfeng held various positions in JMC includingDeputy Plant Manager of Framing Plant, Deputy Chief, Chief of ManufactureDepartment and Assistant to the President of JMC.
Mr. Liu Ranbo, born in 1973, holds a Bachelor’s Degree in Plastic Forming fromWuhan Automotive Polytechnic University, and is a Vice President of JMC andGeneral Manager of Jiangling Motor Sales Co., Ltd., in charge of commercialvehicle sales business of the Company. Mr. Liu Ranbo held various positions inJMC including Marketing Service Manager for Customer Service Department,Regional Manager for East 3 / East 1 District, JMC Light Truck Brand Manager,Sales Director of Jiangling Motors Sales General Company, and Deputy GeneralManager of Jiangling Motor Sales Co., Ltd.
Ms. Wu Jiehong, born in 1976, holds a Bachelor’s Degree in FinanceManagement from Nanchang University and a MBA from Jiangxi University ofFinance and Economics, and is a Vice President of JMC, in charge of the strategicdevelopment of the Company and assist the CFO to support the financial work. Ms.Wu Jiehong held various positions including Assistant to the Chief of FinancialDepartment, Chief of Internal Audit Office, and Chief of Financial Department forJMC, Finance Manager for Ford APA, Chief of Planning Department, andAssistant to the President for JMC.
Mr. Yang Shenghua, born in 1980, holds a Bachelor’s Degree in EnglishLanguage & Literature from Huazhong University of Science and Technology anda Master’s Degree in Business Administration from Nanjing University, and is aVice President of JMC, in charge of purchasing business of the Company. Mr.Yang Shenghua held various positions including Program Purchasing Supervisorof Chang’an Ford Automobile Co., Ltd., Program Purchasing Manager, andPurchasing Strategy & Program Director for JMC.
Mr. Sam Lo, born in 1979, holds a Bachelor's Degree in Mechanical Engineeringfrom National Taiwan University of S&T, China, a Master's degree in MechanicalEngineering from National Taiwan University, China, and is a Vice President ofJMC, in charge of manufacturing business of the Company. Mr. Sam Lo heldvarious positions including Production Superintendent and ME Manager of FordLio Ho Motor Company, VOME Implementation Body Manager and FinalAssembly Manager of Ford Asia & Pacific, Body Area Manager Advisor of
Changan Ford Motor Co., Ltd. Harbin Branch, Plant Launch Manager and PlantManager of Changan Ford Motor Co., Ltd. Hangzhou Branch.
Mr. Zeng Fafa, born in 1978, holds a Bachelor's Degree in AutomotiveEngineering from Nanchang University, China, and is a Vice President of JMC, incharge of manufacturing business of the Company. Mr. Zeng Fafa held variouspositions including Chief of Quality Improvement Section of Quality ControlDepartment, Deputy Director of Quality Control Department, Director of NewModel Program Department, Director of Quality Control Department, Director ofQuality Control & New Model Program Department, Director of ManufactureDepartment, and an Assistant to the President of JMC.
Mr. Anderson Liu, born in 1972, holds a Bachelor’s Degree in Liberal Arts-Psychology from National Taiwan University, China, a Master’s Degree in LiberalArts-Psychology from National Chengchi University, China, and a MBA Degreefrom University of Pittsburgh, USA, is a Vice President of JMC and GeneralManger of Jiangling Ford Motor Technology (Shanghai) Co., Ltd, in charge of thepassenger vehicle sales business of the Company. Mr. Anderson Liu held variouspositions including Financial Analyst, E-Commerce Manager, Research Manager,Marketing Manager for FLH, Sr. Marketing Manager, VP of VW Branch Operation,VP of MS for VW Swire, Sales Director, MS Director for FLH, General Manager ofDealer Network Development and Consumer & Retail Experience for LincolnChina, and Executive Vice General Manager of Jiangling Motor Sales Co., Ltd.
Positions at the shareholder entities
□√Applicable □Not Applicable
Positions in other entities
□√Applicable □Not Applicable
| Name | Shareholder Entity | Title | Term of Office | Compensation Paid by Shareholder Entity (Y/N) | |
| Qiu Tiangao | JIC | Chairman | 2019.05.28 | N | |
| Shengpo Wu | Ford | Group Vice President | 2023.03.01 | Y | |
| Ryan Anderson | Ford | CFO, Ford China | 2021.06.01 | Y | |
| Jin Wenhui | JIC | Director | 2019.05.28 | N | |
| Yuan Mingxue | JIC | Director | 2019.05.28 | N | |
| Zhang Jian | JIC | Chief supervisor | 2019.05.28 | N | |
| Description of the positions in the shareholder entities | None. | ||||
Name
| Name | Entity | Title | Compensation Paid by Other Entities (Y/N) |
| Qiu Tiangao | JMCG | Chairman, Legal Representative | Y |
| Qiu Tiangao | JiangxiISUZU Co., Ltd. | Chairman, Legal Representative | N |
| Qiu Tiangao | JMCG New Energy Vehicle Co., Ltd. | Chairman, Legal Representative | N |
| Qiu Tiangao | Nanchang Jiangling Investment Co. Ltd. | Chairman, Legal Representative | N |
| Qiu Tiangao | Nanchang Intelligent New Energy Vehicle Research Institute | Chairman | N |
| Shengpo Wu | Ford Motor (China) Ltd. | President and CEO | N |
| Shengpo Wu | Whirlpool (China) Co., Ltd. | Vice Chairman | Y |
| Shengpo Wu | Shanghai Guangdian Electric (Group) Co., LTD. | Director | Y |
| Ryan Anderson | Ford Motor (China) Ltd. | Director, Chief Financial Officer | N |
| Ryan Anderson | Chang’an Ford Automobile Co., Ltd. | Director | N |
| Ryan Anderson | Ford Shuttle Trading (Shanghai) Co., Ltd. | Director | N |
| Ryan Anderson | Lincoln Automobile Sales Service (Shanghai) Co., Ltd | Director | N |
| Ryan Anderson | Ford Electric Mach Technology (Nanjing) Co., Ltd | Chairman, Head of Power Technology branch | N |
| Ryan Anderson | Ford Technology (China) Holding Limited | Director | N |
| Ryan Anderson | Ford Technology (China) Holding | Director | N |
| Jin Wenhui | JMCG | Director | N |
| Jin Wenhui | Jiangling Ford Motor Technology (Shanghai) Co., Ltd. | Chairman | N |
| Jin Wenhui | Jiangling Motor Sales Co., Ltd. | Executive Director, Legal Representative | N |
| Jin Wenhui | Hanon Systems (Nanchang) Co., Ltd. | Vice Chairman | N |
| Jin Wenhui | Jiangxi Jiangling Special Purpose Vehicle Co., Ltd. | Director | N |
| Yuan Mingxue | Chongqing Chang’an Automobile Company Limited | Chairman of the Labor Union | Y |
| Chen Jiangfeng | Gilead (Shanghai) Pharmaceutical Technology Co., Ltd. | Executive Director, Senior Deputy General Counsel | Y |
| Wang Yue | Shanghai University of Finance and Economics | Associate Professor | Y |
| Wang Yue | Shanghai XinHua Media Co., Ltd. | Independent Director | Y |
| Wang Yue | Zhuhai Letong Chemical Co., Ltd. | Independent Director | Y |
| Wang Yue | Jiangsu Hongde Special Parts Co.,Ltd. | Independent Director | Y |
| Wang Yue | Guangdong Yangshan United Precision Manufacturing Co., Ltd. | Independent Director | Y |
| Yu Zhuoping | Tongji Automobile Design and Research Institute Co., Ltd. | Chairman | N |
| Yu Zhuoping | Nanchang Jiling New Energy Technology Co., Ltd. | Chairman | N |
| Yu Zhuoping | Shanghai Motor Vehicle Inspection Certification & Tech Innovation Center Co., Ltd. | Director | Y |
| Yu Zhuoping | Beijing National Hydrogen Zhonglian Hydrogen Energy Technology Research Institute Co., Ltd. | Director | N |
| Yu Zhuoping | Shanghai Intelligent New Energy Vehicle Science and Technology Innovation Function Platform Co., Ltd. | Chairman & President | N |
| Yu Zhuoping | Appotronics Corporation Limited | Director | Y |
| Yu Zhuoping | Shanghai Haili (Group) Co., Ltd. | Independent Director | Y |
| Yu Zhuoping | Huayu Automotive Systems Co., Ltd. | Independent Director | Y |
| Yu Zhuoping | Weichai Power Co., Ltd. | Independent Director | Y |
| Yu Zhuoping | Ningbo Shenglong Automotive Powertrain System Co., Ltd. | Independent Director | Y |
| Yu Zhuoping | Huazhong In-Vehicle Holdings Company Limited | Non-executive Director | Y |
| Yu Zhuoping | Shanghai Municipal People's Government | Counsellor | N |
| Yu Zhuoping | China Society of Automotive Engineers | Vice Chairman | N |
| Xiao Hu | JMCG | Chairman of Supervisory Board | Y |
| Xiao Hu | JMCG Jingma Motors Co., Ltd. | Supervisor | N |
| Xiao Hu | Jiangxi Jiangling Group Special Vehicle Co., Ltd. | Supervisor | N |
| Xiao Hu | Jiangxi Jiangling Chassis Co., Ltd. | Supervisor | N |
| Xiao Hu | Jiangling Dingsheng Investment Co., Ltd. | Supervisor | N |
| Xiao Hu | Jiangxi Jiangling Real Estate Co., Ltd. | Chairman of Supervisory Board | N |
| Zhang Yangyang | Ford Motor (China) Ltd. | Director, General Counsel, Principal of Beijing Branch | Y |
| Zhang Yangyang | Ford Motor Research (Nanjing) Co., Ltd. | Supervisor | N |
| Zhang Yangyang | Ford Motor Research Test(Nanjing) Co., Ltd. | Supervisor | N |
| Zhang Yangyang | Ford Shuttle Trading (Shanghai) Co., Ltd. | Supervisor | N |
| Zhang Yangyang | Lincoln Automobile Sales Service (Shanghai) Co., Ltd. | Supervisor | N |
| Zhang Yangyang | Jiangling Ford Motor Technology (Shanghai) Co., Ltd. | Supervisor | N |
| Zhang Yangyang | Ford Electric Mach Technology (Nanjing) Co., Ltd. | Supervisor | N |
| Zhang Yangyang | Ford Electric Mach Technology (Nanjing) Co., Ltd. | Supervisor | N |
| Zhang Yangyang | Jiangling Ford Motor Technology (Shanghai) Co., Ltd. | Supervisor | N |
| Zhang Jian | JMCG | Chairman of the Labor Union | Y |
| Zhang Jian | Nanchang Jiangling Investment Co. Ltd. | Chairman of Supervisory Board | N |
| Zhang Jian | JMCG New Energy Automobile Co. Ltd. | Supervisor | N |
| Zhang Jian | Jiangxi Jiangling Special-Purpose Vehicle Co., Ltd. | Supervisor | N |
| Zhang Jian | Jiangxi JMCG Specialty Vehicles Co., Ltd. | Supervisor | N |
| Zhang Jian | Nanchang Gear Co., Ltd. | Chief Supervisor | N |
| Zhang Jian | JMCG Finance Co., Ltd. | Chief Supervisor | N |
| Zhang Jian | Jiangxi Lingrui Renewable Resources Development Co., Ltd. | Supervisor | N |
| Zhang Jian | Jiangxi Jiangling Real Estate Co.,Ltd | Supervisor | N |
| Zhang Jian | Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. | Chief Supervisor | N |
| Zhang Jian | Magna Powertrain (Jiangxi) Co. Ltd. | Supervisor | N |
| Zhang Jian | Jiangxi Yizhizhixing Automobile Operation Service Co., Ltd. | Supervisor | N |
| Ding Wenming | JMCG | Director | N |
| JoeyZhu | Jiangling Ford Motor Technology (Shanghai) Co., Ltd. | Director | N |
| JoeyZhu | Hanon Systems (Nanchang) Co., Ltd. | Director | N |
| JoeyZhu | Jiangling Motor Sales Co., Ltd. | Supervisor | N |
| Wu Xiaojun | JMC Heavy Duty Vehicle Co., Ltd. | Executive Director, Legal Representative | N |
| Wu Xiaojun | Shenzhen Fujiang New Energy Automobile Sales Co., Ltd. | Executive Director, Legal Representative General Manger | N |
| Wu Xiaojun | Guangzhou Fujiang New Energy Automobile Sales Co., Ltd. | Executive Director, Legal Representative | N |
| Wu Xiaojun | Shanxi Yunnei Power Co., Ltd. | Director | N |
Penalties from securities regulator to the present and resigned Directors,Supervisors and Senior Executives in the recently three years
□Applicable □√Not Applicable
(4). Compensation of Directors, Supervisors and Senior ExecutivesDecision-making procedure, determination of basis, and actual payment regardingthe compensation of the Directors, Supervisors and Senior Executives
Directors and Supervisors who did not concurrently hold other managementpositions in JMC were not paid by JMC. Director Qiu Tiangao, Supervisor Xiao Huand Supervisor Zhang Jian were paid by JMCG. Director Shengpo Wu andDirector Ryan Anderson were paid by Ford. Supervisor Zhang Yangyang was paidby Ford Motor (China) Ltd.. Director Yuan Mingxue were paid by ChongqingChang’an Automobile Co., Ltd.
(a) In accordance with JMC Executive Compensation Scheme approved by theBoard of Directors, the compensation for the Chinese-side senior managementconsists of base salary and floating bonus. The base salary level is determinedaccording the grade of the senior executives, and the floating bones shall be paidaccording to the operating performance. 70% of the bonus will be distributed inthis year, and the rest 30% will be distributed in the next three years. In 2022, theCompany paid annual compensation before tax of approximately RMB 1,910thousand to Director & First EVP Jin Wenhui, paid approximately RMB 1,560thousand to EVP Ding Wenming, paid approximately RMB 1,390 thousand to VPWu Xiaojun, paid approximately RMB 1,370 thousand to VP & Board Secretary XuLanfeng, paid approximately RMB 1,360 thousand to VP Liu Rangpo, paidapproximately RMB 1,430 thousand to VP Wu Jiehong, paid approximately RMB1,050 thousand to VP Zeng Fafa, paid approximately RMB 630 thousand toEmployee-representative Supervisor Ma Jian, paid approximately RMB 430thousand to Employee-representative Supervisor Li Yanling. The Company paidannual compensation before tax of approximately RMB 800 thousand to Ex-VP LiuShuying, paid approximately RMB 880 thousand to Ex-employee-representativeSupervisor Chen Guang. The total compensation before tax paid by JMC for theaforesaid persons was about RMB 12.81 million in the reporting period, includingthe long-term incentive of RMB 740 thousand deferred from the previous years.
(b)JMC pays annual compensation for Ford-seconded senior managementpersonnel to Ford in accordance with the Personnel Secondment Agreement
| Liu Rangpo | Jiangling Ford Motor Technology (Shanghai) Co., Ltd. | Director | N |
| Liu Rangpo | Jiangling Motor Sales Co., Ltd. | General Manager | N |
| Wu Jiehong | JMC Heavy Duty Vehicle Co., Ltd. | Supervisor | N |
| Wu Jiehong | Shanxi Yunnei Power Co., Ltd. | Director | N |
| Wu Jiehong | Shenzhen Fujiang New Energy Automobile Sales Co., Ltd. | Supervisor | N |
| Wu Jiehong | Guangzhou Fujiang New Energy Automobile Sales Co., Ltd. | Supervisor | N |
| Anderson Liu | Jiangling Ford Motor Technology (Shanghai) Co., Ltd. | General Manager | N |
| Description of the positions in other entities | None | ||
signed between JMC and Ford & Ford Affiliates. In 2022, the Company should payapproximately RMB 1,100 thousand to Ford for Director and President XiongChunying, pay approximately RMB 1,100 thousand for CFO Joey Zhu, payUS$ 500 thousand for VP Erik Hermann, pay RMB 1,100 thousand for VP YangShenghua, pay RMB 460 thousand for VP Sam Lo, pay US$ 440 thousand andRMB 660 thousand for VP Anderson Liu, pay RMB 640 thousand for Ex-VP JerryLin, pay RMB 3,310 thousand for Ex-VP Xiang Dongping. These payments madeby JMC to Ford do not reflect the actual salaries earned by Ford-seconded seniormanagement.
(c) Pursuant to the resolutions of JMC 2011 Annual Shareholder’s Meeting, theannual compensation for the JMC Independent Directors is RMB 100 thousandper person, and JMC bears their travel-related expenses associated with JMC’sbusiness. In 2022, the Company paid annual compensation before tax of RMB100 thousand to Independent Director Chen Jiangfeng, Independent DirectorWang Yue, and Independent Director Yu Zhuoping respectively.
Table on compensation of the Directors, Supervisors and Senior Executives in thereporting period
Unit: RMB’ 000
| Name | Position | Gender | Age | Present (Y/N) | Compensation Before Tax Paid by JMC | Compensation Paid by Related Party (Y/N) |
| Qiu Tiangao | Chairman | Male | 56 | Y | 0 | Y |
| Shengpo Wu | Vice Chairman | Male | 56 | Y | 0 | Y |
| Ryan Anderson | Director | Male | 49 | Y | 0 | Y |
| Xiong Chunying | Director & President | Female | 58 | Y | * | Y |
| Jin Wenhui | Director & EVP | Male | 55 | Y | 1910 | N |
| Yuan Mingxue | Director | Male | 54 | Y | 0 | Y |
| Chen Jiangfeng | Independent Director | Male | 43 | Y | 100 | N |
| Wang Yue | Independent Director | Female | 44 | Y | 100 | N |
| Yu Zhuoping | Independent Director | Male | 62 | Y | 100 | N |
| Xiao Hu | Chief supervisor | Male | 54 | Y | 0 | Y |
| Zhang Yangyang | Supervisor | Male | 43 | Y | 0 | Y |
| Zhang Jian | Supervisor | Male | 53 | Y | 0 | Y |
| Ma Jian | Supervisor | Male | 47 | Y | 630 | N |
| Li Yanling | Supervisor | Female | 45 | Y | 430 | N |
| Ding Wenmin | VP | Male | 50 | Y | 1560 | N |
| Joey Zhu | CFO | Male | 40 | Y | * | Y |
| Erik Hermann | VP | Male | 58 | Y | * | Y |
| Wu Xiaojun | VP | Male | 48 | Y | 1390 | N |
| Xu Lanfeng | VP &Board Secretary | Female | 53 | Y | 1370 | N |
| Liu Rangpo | VP | Male | 49 | Y | 1360 | N |
| Wu Jiehong | VP | Female | 46 | Y | 1430 | N |
*See the instructions in the previous paragraph.
6. Directors’ Performance of Duty
(1) Introduction to the Board of Directors
| Yang Shenghua | VP | Male | 42 | Y | * | Y |
| Sam lo | VP | Male | 43 | Y | * | Y |
| Zeng Fafa | VP | Male | 44 | Y | 1050 | N |
| Anderson Liu | VP | Male | 50 | Y | * | Y |
| Manto Wong | Ex-Vice Chairman | Male | 60 | N | 0 | Y |
| Chen Guang | Ex-Supervisor | Male | 49 | N | 880 | N |
| Ding Zhaoyang | Ex-Supervisor | Male | 53 | N | 0 | Y |
| Liu Shuying | Ex-VP | Female | 60 | N | 800 | N |
| Jerry Lin | Ex-VP | Male | 46 | Y | * | Y |
| Xiang Dongping | Ex-VP | Male | 47 | Y | * | Y |
| Total | - | - | - | - | 13,110 | - |
Meeting
| Meeting | Convening Date | Disclosure Date | Meeting Resolutions |
| Paper Meeting | 2022.02.14-02.21 | No matters that should be disclosed are involved. | |
| Paper Meeting | 2022.03.18-03.28 | 2022.03.30 | 1. Proposal on Year 2021 Profit Distribution; 2. approved the 2021 Annual Report of the Company and the Extracts from such Annual Report; 3. approved the 2021 Work Report of the Board of Directors of the Company; 4. approved the Company’s 2021 Financial Statements; 5. approved the Company’s 2021 Internal Control Self-assessment Report; 6. approved the Company’s 2021 Corporate Social Responsibility Report; 7. approved JMCG Finance Company Continuous Risk Assessment Report. 8. approved MC 2021 Assets Impairment Provisions& Write-off proposal. |
| Eighth Session of the Tenth Board | 2022.03.28 | No matters that should be disclosed are involved. | |
| Paper Meeting | 2022.04.19-04.25 | 2022.04.27 | Approved the Company’s 2022 First Quarter Report. |
| Paper Meeting | 2022.05.20-05.27 | 2022.05.31 | 1. approved the personnel changes of senior executives; 2. approved the Notice on Holding 2021 Annual Shareholders’ Meeting of JMC. |
| Ninth Session of the Tenth Board | 2022.06.24 | No matters that should be disclosed are involved. | |
| Paper Meeting | 2022.07.21- | 2022.07.29 | Approved the personnel changes of |
(2) Particulars about the Directors’ attendance to the Board meeting and theShareholders’ Meeting
Statements on failure to attend Board meetings in person for two consecutiveoccasions
| 07.27 | senior executives. | ||
| Paper Meeting | 2022.08.19-08.26 | 2022.08.30 | 1. approved JMC 2022 Half-year Report and the Extracts from JMC 2022 Half-year Report; 2. approved JMCG Finance Company Continuous Risk Assessment Report. |
| Paper Meeting | 2022.09.05-09.09 | No matters that should be disclosed are involved. | |
| Tenth Session of the Tenth Board | 2022.09.23 | No matters that should be disclosed are involved. | |
| Paper Meeting | 2022.10.12-10.18 | 2022.10.20 | 1. approved the Director Changes Proposal; 2. approved the Notice on Holding 2022 First Special Shareholders’ Meeting of JMC. |
| Paper Meeting | 2022.10.18-10.24 | 2022.10.26 | Approved the Company’s Third Quarter Report. |
| Paper Meeting | 2022.11.18-11.24 | 2022.11.25 | 1. elected the Vice Chairman and members of the special committees under the Board of Directors; 2. approved the personnel changes of senior executives. |
| Eleventh Session of the Tenth Board | 2022.12.09 | 2022.12.13 | Approved the 2023 Routine Related Party Transaction Forecast Proposal. |
| Paper Meeting | 2022.12.10 | No matters that should be disclosed are involved. |
Name
| Name | Required Board Attendance | Presence in Person | Presence in form of Paper Meeting | Presence by Proxy | Absence | Not to present in person in two consecutive meetings (Y/N) | Presence at the Shareholders’ Meeting |
| Qiu Tiangao | 15 | 4 | 11 | - | - | N | 1 |
| Shengpo Wu | 3 | 1 | 2 | - | - | N | - |
| Ryan Anderson | 15 | 4 | 11 | - | - | N | 1 |
| Xiong Chunying | 15 | 4 | 11 | - | - | N | 2 |
| Jin Wenhui | 15 | 4 | 11 | - | - | N | 2 |
| Yuan Mingxue | 15 | - | 11 | 4 | - | Y | - |
| Chen Jiangfeng | 15 | 4 | 11 | - | - | N | 1 |
| Wang Yue | 15 | 4 | 11 | - | - | N | 1 |
| Yu Zhuoping | 15 | 4 | 11 | - | - | N | 1 |
| Manto Wong | 12 | 3 | 7 | 2 | - | N | 1 |
Director Yuan Mingxue did not attend the Board meetings in person for twoconsecutive times due to other official commitments.
(3) Dissent from Directors
□Yes □√No
The Directors of the Company had no dissent to the relevant proposals of theCompany in the reporting period.
(4) Other introduction to Directors’ Performance of Duty
Whether the Directors' suggestions on the Company have been adopted
□√Yes □No
Statement of the adoption or not of the Directors’ suggestions on the CompanyAll the Directors of the Company fulfill their duties, diligent, active attention to theCompany’s management information, financial situation, major matters, etc., to theproposals submitted to the Board of Directors thorough study and discussion, andput forward their respective opinions, make recommendations for the Company'sbusiness development, make decisions fully consider the interests of minorityshareholders and the demands, strengthen the scientific Board decision, promotethe sustainable, stable and healthy development of the work.
7. Situation of the Committees under the Board of Directors in the ReportingPeriod
(1) Audit Committee
Members:
Chairman: Wang YueMember: Ryan Anderson, Yuan Mingxue, Chen Jiangfeng, Yu ZhuopingSecretary: Joey Zhu
The number of meetings held in the reporting period: five.
The first Audit Committee meeting of 2022 was convened on January 14,2022. Meeting contents:
Reviewed the 2021 Annual Financial and Accounting Statements of JMC, andwould review the Company's financial and accounting statements again after theauditor forms the preliminary audit opinions.
Important comments and suggestions made: None.
Other performance of duties: None.
Details of the objection to matter: None.
The second Audit Committee meeting of 2022 was convened on February 22,2022. Meeting contents:
Reviewed the Company's financial report after the certified auditor issued itsinitial audit opinions.
Important comments and suggestions made: None.
Other performance of duties: None.
Details of the objection to matters: None.
The third Audit Committee meeting of 2022 was convened on March 3, 2022.Meeting contents:
1.Reviewed the PwC Report;
2.Reviewed the 2021 Financial Report audited by the auditor and agreed tosubmit it to the Board of Directors for approval;
3.Reviewed the Annual Audit Summary Report of External Auditors andagreed to submit it to the Board of Directors for approval;
4.Reviewed the 2021 Internal Control Self-Evaluation Report and agreed tosubmit it to the Board of Directors for approval;
5.Reviewed the Audit Committee Performance Report and agreed to submit itto the Board of Directors for approval;
Important comments and suggestions made: None.
Other performance of duties: None.
Details of the objection to matters: None.
The forth Audit Committee meeting of 2022 was convened on June 24, 2022.Meeting contents:
1.Reviewed the Internal Control Work Report for the first half of 2022 and theWork Plan for the second half of 2022;
2. Reviewed the PwC Report.
Important comments and suggestions made: None
Other performance of duties: None.
Details of the objection to matters: None.
The fifth Audit Committee meeting of 2022 was convened on December 9,2022. Meeting contents:
1.Reviewed the Internal Control Work Report 2022 and approved the InternalAudit Work Plan 2023.
2.Reviewed the Asset Impairment Preparation Report 2022 and agreed tosubmit it to the Board for review.
3.Reviewed and approved the Financial Statements Audit Schedule 2022.
4. Reviewed the PwC Report.
Important comments and suggestions made: The Audit Committeerecommended the company pay more attention to data protection.
Other performance of duties: None.
Details of the objection to matters: None.
(2) Compensation Committee
Members:
Chairman: Chen Jiangfeng
Member: Qiu Tiangao, Ryan Anderson, Wang Yue, Yu Zhuoping
Secretary: Xu Lanfeng
The number of meetings held in the reporting period: one.
A Compensation Committee meeting was convened on March 3, 2022.Meeting contents:
1. Reviewed and approved the Proposal on 2021 Year-end Bonus for theCompany’s senior executives;
2. Reviewed and approved the adjustment of the annual total cash incometarget of the Company’s senior executives in 2022;
3. Reviewed and approved the KPIs for the Company’s senior executives in2022;
5. Reviewed and approved the 2021 Due Diligence Report of theCompensation Committee.
Important comments and suggestions made: None.
Other performance of duties: None.
Details of the objection to matters: None.
(3) Strategy Committee
Members:
Chairman: Qiu Tiangao
Member: Shengpo Wu, Ryan Anderson, Xiong Chunying, Jin Wenhui,Yuan Mingxue
Secretary: Wu Jiehong
The number of meetings held in the reporting period: one.
A Strategy Committee meeting was convened on September 23, 2022.Meeting contents:
Review the strategy status report with the theme of Following DevelopmentTrend and Achieving Strategic Breakthrough.
Important comments and suggestions made: None.
Other performance of duties: None.
Details of the objection to matters: None.
Note: Mr. Shengpo Wu succeeded Mr. Manto Wong as a member of theStrategic Committee of the Company in November 2022.
8. Works of Supervisory Board
Risks found by the Supervisory Board in the reporting period
□Yes □√No
The Supervisory Board had no dissent on inspection items in the reporting period.
9. Employees
(1) Employees, Professional Structure and Educational Level
| Employees in parent company at the end of reporting period(persons) | 11,759 |
| Employees in subsidiaries at the end of reporting period(persons) | 580 |
| Total employees at the end of reporting period(persons) | 12,339 |
| Total employees paid compensation (persons) | 13,118 |
| Retired employees bore retirement benefits in parent company and its subsidiaries | 779 |
| Professional Structure | |
| Type | Employees (Persons) |
| Production Worker | 7,860 |
| Sales Personnel | 660 |
| Technical Personnel | 2,977 |
| Finance Personnel | 156 |
| Administrative Staff | 686 |
| Total | 12,339 |
| Educational Level | |
(2) Compensation Policy
JMC strictly abided by the relevant requirements of national labor laws andregulations, and provided safe and comfortable work places. The Company alsoestablished and improved the incentive system that can effectively help therealization of the Company’s strategy and targets, based on the characteristics ofthe business and talents, the company promotes the multi-talent incentive systemwith orientation on value, ability and contribution, so as to accelerate the growth ofnew automobile talents. The company also strengthens the connection betweenpersonal interests of core talents and the company's medium and long-termstrategic goals, thus driving the achievement of business objectives. At the sametime, the Company constantly improves employee welfare policies to meet thediversified individual needs of employees and improve employee experience andsatisfaction.
(3) Training
In 2022, with To Become Leader in Light Commercial Vehicle and Provider of FordValue Products as the vision, JMC paid attention to the talent transformation andtraining of new automotive technologies, built an effective learning ecology,focused on learning effects and experience, establish a platform, provideresources, and provided human resource support for the Company's strategicgoals, so as to meet the Company's future industry challenges in the field of newenergy, intelligent network and intelligent manufacturing. For more informationabout the completion of 2022 training, please refer to the 2022 SocialResponsibility Report released by the Company.
(4) Labour outsourcing
□Applicable □√Not Applicable
10. Profit distribution and capital reserve conversion
Establishment, implementation or adjustment of profit distribution policy, esp. cashdividend distribution policy, regarding common stock during the reporting period
□√Applicable □Not Applicable
In accordance with the requirements of laws, regulations and the Articles ofAssociation of the Company, the Company's profit distribution policy maintainscontinuity and stability, and the Company pays attention to the reasonable returnto investors. The Company gives priority to cash dividend, and subject to theprovisions of laws, regulations and the Articles of Association of the Company, theBoard of Directors can put forward a mid-term or special profit distributionproposal. The Company's profit distribution policy is in line with the CSRC'sguidance on encouraging cash dividends for listed companies.
| Type | Employees (Persons) |
| Master degree and higher | 884 |
| Undergraduate degree | 3,478 |
| Polytechnic school degree | 1,602 |
| Below polytechnic school degree | 6,375 |
| Total | 12,339 |
Special Explanation on Cash Dividend Policy
| Special Explanation on Cash Dividend Policy | |
| Whether to comply with the requirements of the Articles of Association of JMC | Y |
The Company made a profit during the reporting period and the profit of the parentcompany distributable to the common shareholders is positive, but a distributionplan of cash dividends for the common shares is not put forward
□Applicable □√Not Applicable
Proposal on Year 2022 Profit Distribution Plan or Capital Reserve Conversion
□√Applicable □Not Applicable
11. Implementation of Equity Incentive Plan, Employee Stock Ownership Plan andOther Employee Incentive Method
□Applicable □√Not Applicable
There was neither equity incentive plan or ESOP, nor other employee incentivemethod during the reporting period.
| or resolution of the Shareholders’ Meeting (Y/N) | |
| Whether the standards and proportion of dividends on profit distribution are clear (Y/N) | Y |
| Whether the procedures are valid and legal (Y/N) | Y |
| Whether the Independent Director fulfil their duties (Y/N) | Y |
| Whether middle and small shareholders have opportunities to claim their appeals and their legal rights and interests are completely protected (Y/N) | Y |
| Whether the condition and procedure are reasonable and transparent when the cash dividend policy is being changed (Y/N) | Y |
Stock dividend (share) for every 10 shares
| Stock dividend (share) for every 10 shares | 0 |
| Cash Dividend (RMB) for every 10 shares (including tax) | 4.24 |
| Total share capital (share) | 863,214,000 |
| Total cash dividend distribution amounts (RMB) (including tax) | 366,002,736 |
| Amount of cash dividend (RMB) in other ways (e.g. repurchase of shares) | 0 |
| Total cash dividend amounts (RMB) (including other ways) | 366,002,736 |
| Distributable profit (RMB) | 7,123,038,093 |
| Total cash dividends (including other ways) as a proportion of total profit distribution | 100% |
| Cash dividend status | |
| If the development stage of the Company is not easy to distinguish but there are major fund expenditure arrangements, the minimum proportion of cash dividends in this profit distribution shall reach 20% when the profit distribution is carried out. | |
| Detailed description of profit distribution or capital reverse conversion proposal | |
| Proposal on year 2022 profit distribution: the Company plans to distribute a cash dividend of RMB 4.24 (including tax) for every 10 shares held. Based on the total share capital of 863,214,000 shares as of December 31, 2022, the total cash dividend distribution amounts shall be RMB 366,002,736. The cash dividend on B share shall be paid in Hong Kong Dollars and converted at the middle rate of the HK dollar’s exchange rate against RMB quoted by the People’s Bank of China on the first working day following the relevant resolution adopted by the Company’s Annual Shareholders’ Meeting. The Board decided not to convert the capital reserve to the share capital this time. The proposal is subject to the approval of the Company’s 2022 annual shareholders’ meeting. | |
12. Internal control system construction and implementation during the reportingperiod
(1) Internal control construction and implementation
According to the requirements of the Basic Standard for Enterprise InternalControl (C-SOX) along with its Application Guidelines and Internal ControlGuidelines for Public Companies listed on the Shenzhen Stock Exchange jointlyissued by the Ministry of Finance and China Security Regulation Commission, theCompany has established a set of sound and effective internal control system, andat the same time, combined with the internal and external environment, internalinstitutions and management requirements, so as to make the internal controlsystem design scientific, simple, applicable and effective operation.
The Company has reasonably planned the organizational structure, andestablished a control structure with the full participation of the Audit Committee,Executive Committee, senior management and business level under theleadership of the Board of Directors. The Audit Committee has an auditdepartment, which supervises and evaluates the operation of the Company'sinternal control system through internal audit.
Through the operation, analysis and evaluation of the internal control system, theCompany has effectively prevented the risks in the operation and management,and promoted the realization of the internal control objectives.
This year, the Company's internal control can cover the main aspects of theCompany's operation and management without major omissions; the units,businesses and matters and high-risk areas included in the evaluation scopecover the main aspects of the Company's operation and management withoutmajor omissions.
(2) Major defect of internal control in the reporting period
□Yes □√No
13.The Company's management control over the subsidiaries during the reportingperiod
□Applicable □√Not Applicable
During the reporting period, the Company has not purchased new subsidiaries.
14. Internal Control Self-Assessment Report or Internal Control Audit Report
(1) Internal Control Self-Assessment Report
| Issuance date | March 30, 2023 | |
| Index | www.cninfo.com.cn | |
| Total value of assets of the entities in scope counts as % of that disclosed in the consolidated financial statements | 100.00% | |
| Total value of operating revenue of the entities in scope counts as % of that disclosed in the consolidated financial statements | 100.00% | |
| Deficiency Determination Criteria | ||
| Type | Type | Type |
| Qualitative Criteria | Material Weakness: An error that | Material Weakness: Unscientific |
| changes the trend of results, changes profit to loss or loss to profit Ineffective anti-fraud process or any fraud involving senior management Ineffective control over accounting policies Ineffective oversight by the Audit Committee Significant Deficiency; Errors in management reporting systems or Corporate accounting records that could lead to incorrect management decisions; Actions inconsistent with Company values, policies and other Corporate guidelines that are likely to significantly impact cost, quality, customer satisfaction, reputation, or competitive advantage; Control issues in IT infrastructure or applications that may lead to impairment of Company operations. Any actions indicating fraud or theft that is significant in value Minor Deficiency; Any control deficiencies that do not meet the criteria for material or significant. | decision making process such as incorrect decisions that result in unsuccessful mergers and acquisitions; Major regulatory compliance issues; Frequent media reports harmful to the Company’s reputation; A lack of control within key business processes or systematic breakdown of control policies Material weakness identified in the self-assessment without any action plan implemented Significant Deficiency; control deficiency, or combination of control deficiencies, that does not meet the criteria for material weakness but deserves the concerns of the Audit Committee and the Board of Directors. Minor Deficiency Any control deficiencies that do not meet the criteria for material or significant. | |
| Quantitative Criteria | Material Weakness Misstatement in the Income Statement is more than 5% of the annual profit before taxation; Misclassification in the Income Statement is more than 0.4% of the annual sales revenue Adjustment of net assets in the Balance Sheet is more than 1% of the shareholders' equity Adjustment of asset or liability in the Balance Sheet is more than 0.6% of the total assets; Adjustment in the Cash Flow Statement is more than 3% of the total net cash flow in the operating activities. Significant Deficiency Misstatement in the Income Statement is more than 2.5% of the annual profit before taxation; Misclassification in the Income Statement is more than 0.2% of the annual sales revenue; Adjustment of | Please refer to internal control deficiency over financial reporting for the criteria for non-financial reporting internal control. |
(2). Internal Control Audit Report
□√Applicable □Not Applicable
Abnormal opinion issued by the accounting firm
□Yes □√No
Whether the Opinion issued by the accounting firm keeps the same with that ofself-assessment report made by the Board?
□√Yes □No
15.Situation of Problem Rectification for the self-inspection of the special actionfor the governance of listed companies
According to the deployment of the China Securities Regulatory Commission, in2021, the Company organized the self-inspection of the special action for thegovernance of listed companies. After self-inspection, the Company did not findany situation that needs to be rectified.
| net assets in the Balance Sheet is more than 0.5% of the Shareholders’ equity; Adjustment of asset or liability in the Balance Sheet is more than 0.3% of the Total assets; Adjustment in the Cash Flow Statement is more than 1.5% of the total net cash flow from the operating activities. Minor Deficiency All the deficiencies that do not meet the quantitative criteria for significant. | ||
| Number of Material Weakness in financial report | 0 | |
| Number of Material Weakness in non-financial report | 0 | |
| Number of Significant Deficiency in financial report | 0 | |
| Number of Significant Deficiency in non-financial report | 0 | |
Opinions in the Internal Control Audit Report
| Opinions in the Internal Control Audit Report | |
| The comments in the Internal Control Audit Report issued by PWC Zhongtian Accountants (special general partnership) are as follows: On December 31, 2022, JMC maintained effective internal control of financial reporting in all major aspects in accordance with the Basic Code for Enterprise Internal Control and relevant provisions. | |
| Disclosure of Internal Control Audit Report | Disclosed |
| Issuance Date | March 30, 2023 |
| Index | www.cninfo.com.cn |
| Type of Opinion | Standard and unqualified opinions |
| Major Defect Regarding Non-financial Report or no | No |
Chapter V Environment and Social Responsibilities
1.Major Environmental issues
(1) Environmental protection
Whether the Company and affiliates is the key pollution discharge unit publishedby environmental protection administration?
□√Yes□No
Environmental protection related policies and industry standardsIn the process of production and operation, the Company strictly abides by theEnvironmental Protection Law, Air Pollution Prevention and Control Law, WaterPollution Prevention and Control Law, Solid Waste Pollution Prevention andControl Law, Environmental Impact Assessment Law and industry standards andother laws and regulations related to environmental protection. Through theimplementation of ISO14001 environmental management system and FordEnvironmental operating system, the Company firmly establishes the belief thatquality and environmental protection are equal, strictly complies withenvironmental laws and regulations, constantly reduces the environmentalpollution and resource loss in the manufacturing process, avoids environmentalaccidents, and continuously improves environmental behavior.
Situation of administrative permit for environmental protectionIn the process of environmental operation control, the Company takes the initiativeto analyze and foresee the current and future hidden worries, actively takespreventive measures, and makes targeted countermeasures to implementimprovements. In terms of new construction, expansion and reconstructionprojects, the Company should make comprehensive environmental protectionplanning and "three simultaneous" assessment, and always implement theconcept of energy saving and low carbon from the design source. The Companyapply for Cast Plant pollutant discharge permit in 2020, valid until June 2023;Apply for Fushan Plant pollutant discharge permit in 2021, valid until 2024; Re-apply for Xiaolan Plant pollutant discharge permit in 2022, valid until 2027; Applyfor Axle Plant pollutant discharge permit in 2022, valid until 2027.
| Name of company or subsidiary | JMC | JMC |
| Kind of principal pollutant and specific pollutant | Wastewater discharge pollutant | Exhaust emission pollutant |
| Name of principal pollutant and specific pollutant | Wastewater (COD, NH-N) | Exhaust gas (SO2, NOx, smoke, toluol, xylene） |
| Mode of discharge | Continuous discharge | Continuous discharge |
| Number of discharge outlet | 4 | 146 |
| Distribution of discharge outlet | 1 in Fushan Site, 1 in Xiaolan Site, 1 in Cast Plant and 1 in Axle Plant | 33 in Fushan Site, 78 in Xiaolan Site, 32 in Cast Plant and 3 in Axle Plant |
| Discharge concentration | "COD: 61mg/L NH-N: 2.73mg/L | NOx: 74mg/m3; NMHC: 0.97mg/m3 |
| Applicable standard for pollutant discharge | Gan EIA [2015] No. 144 | Emission Standards for Atmospheric Pollutants from Boilers (GB13271-2014) Volatile Organic Compounds Emission Standards - Part 5: Auto Manufacturing (DB36/1101.5-2019) |
| Total amount of discharge | COD: 47.01t; NH-N: 4.07t | NOx: 3.76t |
| Total amount of discharge audited | COD≤517.39t; NH-N≤24.795t | NOx≤5.879t |
| Excessive discharge | Meet Standard | Meet Standard |
Treatment of pollutantsThe Company built a number of zeolite roller +RTO VOCs treatment facilities tocollect and dispose of waste gas in Paintshop. The concentration adsorptiondevice of zeolite roller utilizes absorption and desorption procedures in threecontinuous temperature change process of adsorption - concentration - desorption,so that the organic waste gas with low concentration and large air volume can beconcentrated into concentrated gas with high concentration and small air volume.RTO, also known as Regenerative Thermal Oxidizer, oxidizes organic waste gasinto CO2 and H2O at high temperature (≥760℃), so as to purify waste gas andrecycle the heat released during decomposition to realize both environmentalprotection and energy saving. The VOCs emission of unit painting in Xiaolan Plantis 9.57g, down 70% year on year. VOCs emission decreased by around 700 tonsannually.
In 2022, the Company upgraded wastewater treatment and aeration system inXiaolan Plant, thus improving biochemical water quality standards and sludgefiltration system capacity. The concentration of COD pollutants in the connectedgovernment platform was reduced from 300mg/l before the project optimization toless than 50mg/l, which was far lower than the emission limit of 500mg/l requiredby the regulations. It was ensured that 100% of the Company's annual sewagedischarge satisfy the criteria. The Company also constructed standardized onlinemonitoring rooms, special rooms, equipped with monitoring, air conditioning, watersupply and other supporting facilities, so as to become a pilot of government'senvironmental inspection while meeting the requirements of regulations.
Emergency plan on emergency environmental incidentsIn order to dilute or prevent environmental risks, JMC established an emergencypreparation and response procedure and specific environmental emergency plans,so as to formulate corresponding control methods for potential accidents andemergences occurred or that may probably occur, and has been filed with theenvironmental protection bureau. JMC organize various emergency drills to theeffectiveness of the plan.
Environmental self-monitoring schemeJMC carries out self-monitoring in strict accordance with the Method for Self-
monitoring and Information Disclosure of State Key Monitoring Enterprises (Trial).Its self-monitoring schemes, monitoring results and annual monitoring reports onpollution sources were disclosed on the “Jiangxi Province pollution sourceenterprise portal system” and “National pollution source monitoring informationmanagement and sharing platform”.
Relevant information of investment in environmental governance and protectionand payment of environmental protection taxThe Company has invested more than RMB 60 million to build five wastewatertreatment stations, including Fushan Wastewater Treatment Station and XiaolanWastewater Treatment Station, with a treatment capacity of 5,000 tons/day, andthe treated wastewater has reached the national discharge standard steadily. Inorder to ensure the standard of exhaust emissions, the Company has been takingnew measures over the years. In 2021, Fushan Plant invested RMB 20 million toinstall zeolite wheel +RTO disposal facility, which uses heating and hightemperature combustion technology to react and decompose organic pollutantsinto harmless waste gas, so as to achieve the purpose of air purification. In 2022,the Company spend RMB 30 million on environmental management and operation,and pay Environmental protection tax of RMB 220 thousand.
Measures and effects taken to reduce carbon emissions during the reportingperiod
□√Applicable □Not Applicable
JMC has been adhering to green development principle to provide green, energy-saving and environment-protection automobiles and responding to national“double carbon” target, leading low carbon actions. Photovoltaic power generationshelters were built above Xiaolan, Fushan and 600mu vehicle parking lot andemployees’ parking lots. Annual power generation is 64 million kilowatt hours.Saving 19,850 tons of standard coal per year; Reduce CO2 emissions by 52,122tons/year; Reduce SO2 emissions by 1920 tons/year; Reduce NOx emissions by960 tons/year. In the process of product manufacturing, energy consumption isreduced by optimizing production scheduling, balancing production, optimizingprocess, transforming energy-saving technology, advocating green office andother measures. In 2022, the Company's comprehensive energy consumption permillion output value decreased by 12% compared with 2021; The comprehensiveenergy consumption of the Company's single vehicle decreased by nearly 5%compared with 2021.
Administrative punishment for environmental problems during the reporting periodNone.
Other environmental information that should be disclosedNone.
Other environmental protection related informationNone.
2. Corporation Social Responsibilities
JMC 2022 Corporation Social Responsibilities Report has been published on thewebsite: www.cninfo.com.cn. on the same day with the Annual Report.
3. The consolidation and expansion of poverty alleviation achievements and ruralrevitalizationThe Company has thoroughly implemented the decision and arrangement of theCPC Central Committee on consolidating and expanding the achievements ofpoverty alleviation and comprehensively promoting rural revitalization. Accordingto the arrangement of Jiangxi Provincial Party Committee and provincialgovernment and with the support of JMCG, the Company has participated in thedesignated assistance work of Xianting Village, Songhu Town, Xinjian District,Nanchang City, Jiangxi Province.
In 2022, by convening a meeting of village representatives and visiting farmers onsite, and combining industrial structure and unique projects of Xianting Village, theteam created a five-year support plan featuring the development of “three gardens”(1,000 mu of oilseed rape garden, 100 mu of water chestnut garden and 100 muof allium garden), so as to comprehensively improve the profitability of industriesand promote income growth, promote industrial revival of the village, and enhancethe driving force of rural revitalization. With the joint efforts of JMCG and the twocommittees of the village, Xianting Village has obtained two indicators for theconstruction of common rich model villages. The main entrance roads of thevillage have been fully hardened, the drainage system has been perfected, thecorridor of village folk culture has been built, and 16 dilapidated old buildings havebeen demolished, over 4000 square meters of ground has been levelled, theinfrastructure has been significantly improved, and the village appearance hasbeen further promoted.
In 2022, JMC donated RMB 2 million to China Rural Development Foundation toimplement the “Jiangling Xiqiao Project”, with 5 convenient bridges constructed inJiangxi and Hunan province. By the end of 2022, JMC has invested a total of RMB
36.6 million to build 422 bridges in 25 provinces (municipalities and autonomousregions). JMC, which cares for children and assists rural revitalization, hasdonated 30 computers to the village committee of Luoyang Village, Dafen Town,Suichuan County, Jiangxi Province.
The Company won the honor of “2022 Poverty Alleviation Model” and “2022Corporate Social Responsibility Industry Model” in the 12
thChina Public WelfareFestival, and was awarded the “Outstanding Contribution Award for HelpingPoverty Alleviation” by China Rural Development Foundation (formerly ChinaFoundation for Poverty Alleviation).
Chapter VI Major events
1. Commitments
(1) Commitments of actual controlling parties, shareholders, related parties,acquirers and the Company finished in the reporting period or overdue unfinishedby the end of the reporting period
□Applicable √Not Applicable
There is no commitment of actual controlling parties, shareholders, related parties,acquirers and the Company finished in the reporting period or overdue unfinishedby the end of the reporting period.
(2) Earnings forecast of the assets or project and the explanations
□Applicable □√Not Applicable
2. Non-operating funding in the Company occupied by controlling shareholder andits affiliates
□Applicable □√Not Applicable
There was no non-operating funding in the Company occupied by controllingshareholder and its affiliates.
3. Illegal outside guarantee
□Applicable √Not Applicable
The Company had no illegal outside guarantee during the reporting period.
4.The Board's explanation of the situation related to the latest "non-standard auditReport"
□Applicable □√Not Applicable
5. Explanation of the Board of Directors, Supervisory Board and IndependentDirectors to abnormal opinions from accounting firm
□Applicable □√Not Applicable
6. Description of changes in accounting policies, accounting estimates, orcorrection of major accounting errors compared to the financial report of theprevious year
□Applicable □√Not Applicable
There was no change in accounting policies, accounting estimates, and norcorrection of major accounting errors during the reporting period.
7.Description of changes in the scope of consolidated statements as comparedwith the financial statements of the previous year
□Applicable □√Not Applicable
There was no change in the scope of the consolidated statements during thereporting period.
8. Appointment or Dismissal of Accounting Firm
Current appointed accounting firm
| Name | PricewaterhouseCoopers Zhong Tian LLP |
| Compensation (RMB’000) | 1,840 |
| Consecutive years offering audit services | 21 |
| Names of signed accountants | Ye Jun, Xiao Minjie |
| Consecutive years offering audit services of signed accountants | Ye Jun 1 year, Xiao Minjie 1 year |
Dismissal of accounting firm
□Applicable □√Not Applicable
Appointment of C-SOX auditor, financial consultant or sponsor
□√Applicable □Not Applicable
Upon the approval of 2020 Annual Shareholders’ Meeting, JMC appointedPricewaterhouseCoopers Zhong Tian LLP as JMC’s 2022 to 2024 C-SOX auditor.In 2022, JMC paid RMB 440 thousand to PricewaterhouseCoopers Zhong TianLLP for the C-SOX audit.
9. Suspension and Termination of Listing after Annual Report Disclosed
□Applicable □√Not Applicable
10. Related Matters regarding Bankruptcy
□Applicable □√Not Applicable
There was no matter involving bankruptcy during the reporting period.
11. Major Litigation or Arbitration
□Applicable □√Not Applicable
There was no major litigation or arbitration during the reporting period.
12. Punishment
□Applicable □√Not Applicable
Neither JMC nor its Directors or senior management were punished by regulatoryauthorities during the reporting period.
13. Honesty and credit of JMC and its controlling shareholder or actual controllingparty
□Applicable □√Not Applicable
14. Major Related Transactions
(1) Routine related party transactions
Please refer to the Note 7 related party transactions of the notes to theconsolidated financial statements in the Chapter X Financial Statements for details.
(2) Major related party transaction concerning transfer of assets or equity
□Applicable □√Not Applicable
There was no major related party transaction concerning transfer of assets orequity in the reporting period.
(3) Related party transaction concerning outside co-investment
□Applicable □√Not Applicable
(4) Related credit and debt
□√Applicable □Not Applicable
Is there non-operating related credit and debt?
□Yes □√No
The Company had no non-operating related credit and debt in the reporting period.
5、Transaction with related financial companies or financial companies that thecompany holds
□√Applicable □Not Applicable
Deposit business
| Related party | The related relationship | Maximum daily deposit limit | Deposit rate | Balance at the beginning of the period(RMB thousands) | Current amount | Balance at the end of the period (RMB thousands) | |
| Deposit amount (RMB thousands) | Take out the amount (RMB thousands) | ||||||
| JMCG Finance Company | Subsidiary of JMCG | * | 1.725%-2.25% | 1,059,580 | 13,280,440 | 13,453,780 | 886,240 |
* Note: JMC applies the consolidated deposit limit in JMCG Finance Company atthe end of each month to the lower of the following: 1) 25% of JMCG FinanceCompany absorbing deposit in prior year end; or 2) 12% of JMC’s consolidatedtotal cash reserve.
Loan business
| Related party | The related relationship | loan limit (RMB thousands) | Loan rate range | Balance at the beginning of the period (RMB thousands) | Current amount | Balance at the end of the period (RMB thousands) | |
| Loan amount (RMB thousands) | Repayment amount (RMB thousands) | ||||||
| JMCG Finance Company | Subsidiary of JMCG | 1,000,000 | 2.5% | 0 | 200,000 | 0 | 200,000 |
Granting credit or other financial business
| Related party | The related relationship | Type of business | Total (RMB thousands) | Actual amount (RMB thousands) |
| JMCG Finance Company | Subsidiary of JMCG | Granting credit | 1,300,000 | 340,330 |
6. The transactions between the financial company controlled by the company andits related parties
□Applicable □√Not Applicable
The Company has no controlling financial company.
(7) Other major related party transactions
□√Applicable □Not Applicable
Please refer to the Note 7 related party transactions of the notes to theconsolidated financial statements for details.
The announcement on Related Party Transactions
| Name | Disclosure Date | Website for Disclosure |
| Public Announcement on the 2023 Forecast Routine Related Party Transactions | 2022.12.13 | www.cninfo.com.cn. |
15. Major Contracts and Execution
(1) Entrustment, contract or lease
a. Entrustment
□Applicable □√Not Applicable
There was no entrustment in the reporting period.
b. Contract
□Applicable □√Not Applicable
There was no contract in the reporting period.
c. Lease
□√Applicable □Not Applicable
Please refer to the Note 4 (16), note 4 (29) and note 7 (5) (b) of the financialstatements in the Chapter X Financial Statements for detail.
Project of which the profit and loss brought for the company reaches more than 10%of the total profit of the company during the reporting period
□Applicable □√Not Applicable
There was no leasing project of which the profit and loss brought for the Companyreached more than 10% of the total profit of the Company during the reportingperiod.
(2) Major guarantee
□Applicable □√Not Applicable
The Company had no outside guarantee in the reporting period.
(3) Entrustment on cash asset management
a. Trust investment
□Applicable □√Not Applicable
There was no trust investment in the reporting period.
b. Entrusted loan
□Applicable □√Not Applicable
There was no entrusted loan in the reporting period.
(4) Other major contract
□Applicable □√Not Applicable
There was no other major contract in the reporting period.
16. Other Major Events
□√Applicable □Not Applicable
In 2022, the Company received government incentives of approximate RMB 907million appropriated from Nanchang City, Nanchang Xiaolan Economic andTechnological Development Zone, which is to support the daily operation anddevelopment of the Company.
17.Major event of JMC subsidiary
□√Applicable □Not Applicable
In January 2021, the Shareholders’ Meeting of JMC approved to increase thecapital by RMB 1.142 billion in cash to JMC Heavy Duty Vehicle Co., Ltd. Uponcompletion of the capital increase, the registered capital of JMC Heavy DutyVehicle Co., Ltd. was increased from RMB 181,793,174 to RMB 1,323,793,174.InMay 2021, the Shareholders’ Meeting of JMC approved to sell 100% of the equityof JMC Heavy Duty Vehicle Co., Ltd. through the public bidding process at ShanxiProperty Rights Exchange. At the expiration of the bidding announcement period,the above subject matter is solicited to an intended transferee, Volvo LastvagnarAktiebolag. On August 23, 2021, by consensus, the Company signed the EquityInterest Transfer Agreement Relating to100% of the Equity Interests in JMCHeavy Duty Vehicle Co., Ltd. with Volvo Lastvagnar Aktiebolag. As of the date ofdisclosure of the report, the relevant transaction between the Company and VolvoLastvagnar Aktiebolag is still in progress.
Chapter VII Share Capital Changes & Shareholders
1. Changes of shareholding structure
I. Table of the changes of shareholding structure
| Before the change | Change (+, -) | After the change | |||||||
| Shares | Proportion of total shares (%) | New shares | Bonus Shares | Reserve- converted shares | Others | Subtotal | Shares | Proportion of total shares (%) | |
| I. Limited tradable A shares | 750,840 | 0.09% | 750,840 | 0.09% | |||||
| 1. Other domestic shares | 750,840 | 0.09% | 750,840 | 0.09% | |||||
| Including: | |||||||||
| Domestic legal person shares | 745,140 | 0.09% | 745,140 | 0.09% | |||||
| Domestic natural person shares | 5,700 | 0.00% | 5,700 | 0.00% | |||||
| II. Unlimited tradable shares | 862,463,160 | 99.91% | 862,463,160 | 99.91% | |||||
| 1. A shares | 518,463,160 | 60.06% | 518,463,160 | 60.06% | |||||
| 2. B shares | 344,000,000 | 39.85% | 344,000,000 | 39.85% | |||||
| III. Total | 863,214,000 | 100.00% | 863,214,000 | 100.00% | |||||
Causes of shareholding changes
□Applicable □√Not Applicable
Approval of changes of shareholding structure
□Applicable □√Not Applicable
Shares Transfer
□Applicable □√Not Applicable
Impact on accounting data, such as the latest EPS, diluted EPS, shareholders’equity attributable to the equity holders of the Company, generated from sharestransfer
□Applicable □√Not Applicable
Others to be disclosed necessarily or per the requirements of securities regulator
□Applicable □√Not Applicable
II. Changes of limited A shares
□Applicable □√Not Applicable
2. Securities Issuance and Listing
I. Securities issuance (not including preferred shares) in the reporting period
□Applicable □√Not Applicable
II. Explanation on changes of shares, shareholding structure, assets and liabilitiesstructure
□Applicable □√Not Applicable
III. Current staff shares
□Applicable □√Not Applicable
3. Shareholders and actual controlling parties
I. Total shareholders, top ten shareholders, and top ten shareholders holdingunlimited tradable shares
| Total shareholders as of the end of the reporting period | JMC had 49,715 shareholders, including 44,030 A-share holders, and 5,685 B-share holders, as of December 31, 2022. | |||||
| Total shareholders as of the last month-end prior to the disclosure date of the Report | JMC had 44,104 shareholders, including 38,404 A-share holders, and 5,700 B-share holders, as of February 28, 2023. | |||||
| Top ten shareholders | ||||||
| Shareholder Name | Shareholder Type | Shareholding Percentage (%) | Shares at the End of Year | Change (+,-) | Shares with Trading Restriction | Shares due to mortgage or mark or frozen |
| Nanchang Jiangling Investment Co., Ltd. | State-owned legal person | 41.03% | 354,176,000 | 0 | 0 | 0 |
| FORD MOTOR COMPANY | Foreign legal person | 32.00% | 276,228,394 | 0 | 0 | 0 |
| Shanghai Automotive Co., Ltd. | State-owned legal person | 1.51% | 13,019,610 | 0 | 0 | 0 |
| Jin Xin | Domestic Natural Person | 0.71% | 6,106,200 | 1,487,064 | 0 | 0 |
| Hong Kong Central Clearing Limited | Foreign legal person | 0.64% | 5,498,732 | 1,074,854 | 0 | 0 |
| GAOLING FUND, L.P. | Foreign legal person | 0.63% | 5,453,086 | 0 | 0 | 0 |
| INVESCO FUNDS SICAV | Foreign legal person | 0.44% | 3,818,089 | -636,755 | 0 | 0 |
| BARCLAYS BANK PLC | Foreign legal person | 0.36% | 3,137,070 | 3,137,070 | 0 | 0 |
| Li Yifeng | Domestic Natural Person | 0.31% | 2,653,600 | -242,426 | 0 | 0 |
| LSV EMERGING MARKETS EQUITY FUND, L.P. | Foreign legal person | 0.23% | 1,961,600 | 0 | 0 | 0 |
| Strategic investors or general legal persons become the top 10 shareholders due to the placement of new shares | None. | |||||
| Notes on association among above-mentioned shareholders | None. | |||||
| Description of the above shareholders' entrusted / entrusted voting rights and waived voting rights | None. | |||||
| A special description of the special repurchase account among the top 10 shareholders | None. | |||||
| Top ten shareholders holding unlimited tradable shares | ||||||
| Shareholder Name | Shares without Trading Restriction | Share Type | ||||
| Nanchang Jiangling Investment Co., Ltd. | 354,176,000 | A share | ||||
| FORD MOTOR COMPANY | 276,228,394 | B share | ||||
| Shanghai Automotive Co., Ltd. | 13,019,610 | A share | ||||
| Jin Xin | 6,106,200 | B share | ||||
| Hong Kong Central Clearing Limited | 5,498,732 | A share | ||||
| GAOLING FUND, L.P. | 5,453,086 | B share | ||||
| INVESCO FUNDS SICAV | 3,818,089 | B share | ||||
| BARCLAYS BANK PLC | 3,137,070 | A share | ||||
| Li Yifeng | 2,653,600 | B share | ||||
| LSV EMERGING MARKETS EQUITY | 1,961,600 | B share | ||||
| FUND, L.P. | |
| The top 10 shareholders to sell circulated shares, and the infinite tradable relationship between shareholders and top 10 shareholders or concerted action | None. |
| Notes on association among above-mentioned shareholders | None. |
Stock buy-back by top ten shareholders or top ten shareholders holding unlimitedtradable shares in the reporting period
□Applicable □√Not Applicable
The top 10 common shareholders of the Company and the top 10 commonshareholders with unlimited conditions of sale did not conduct agreed repurchasetransactions during the reporting period.
II. Controlling ShareholdersNature of controlling shareholders: Central/Local government holdings, foreign
holdingsType: Legal person
| Name | Legal representative | Established Date | Organization code | Main scope of business |
| Nanchang Jiangling Investment Co., Ltd. | Qiu Tiangao | May 28, 2019 | 91360125MA38LUR91F | investment management, industrial investment, asset management and other business. |
| Ford Motor Company | William Clay Ford, Jr. | January 1, 1903 | to design, manufacture, market, and service a full line of Ford cars, trucks, sport utility vehicles (“SUVs”), electrified vehicles, and Lincoln luxury vehicles, provide financial services through Ford Motor Credit Company LLC, and be pursuing leadership positions in electrification, autonomous vehicles, and mobility solutions. | |
| Equity status of other listed companies in domestic and aboard market controlled and participated by the controlling shareholders during the reporting period | None | |||
Change of controlling shareholders
□Applicable □√Not Applicable
The controlling shareholders of the Company did not change during the reportingperiod.
III. Actual Controlling PartiesNature of controlling shareholders: Central/Local State-owned Assets Supervision
and AdministrationType: Legal person
| Name | Legal representative | Established Date | Organization code | Main scope of business |
| JMCG | Qiu Tiangao | July 27, 1991 | 91360000158263759R | manufacturing of automobiles, engines, chassis, specialty vehicle, transmission, other products, automotive quality testing, sales of self-produced products and raw |
| materials, equipment, electronic products, parts and others, as well as related after-sales services and maintenance services; development of products derived from JMC brand light vehicle; overseas auto project-contracting, export equipment, material and related labour services. | ||||
| Chongqing Changan Automobile Co., Ltd. | Zhu Huarong | October 31, 1996 | 9150000020286320X6 | development, manufacturing, sales, import & export business of auto (including sedan), engine, automotive components, die, tools, installation of machinery, technological consultant services. |
| Equity status of listed companies in domestic and aboard market controlled by the actual controlling parties during the reporting period | None | |||
Change of actual controlling parties
□Applicable □√Not Applicable
There was no change of actual controlling parties in the reporting period.
Ownership and control relations between the Company and the actual controllingparties are shown as follows:
Actual controlling parties control the Company by the way of trust or other assetsmanagement
□Applicable □√Not Applicable
IV. The cumulative number of shares pledged by the controlling shareholder or thelargest shareholder and its acting partners accounts for 80% of the number ofshares held by them.
□Applicable □√Not Applicable
V. Other legal person shareholder holding more than 10% of total equity of theCompany
□Applicable □√Not Applicable
VI Shareholding reducing restriction to controlling shareholders, actual controllingparties, restructuring parties and other commitment-making entities
| SASAC | ||
| Nanchang State-owned Assets Supervision and Administration Committee |
Chongqing Changan Automobile Co., Ltd.
Chongqing Changan Automobile Co., Ltd.
100%
100%
JMCG
JMCG
41.58%
41.58%
50%
| 50% | 50% |
Nanchang Jiangling Investment Co., Ltd.
| Nanchang Jiangling Investment Co., Ltd. | Ford Motor Company |
32%
| 41.03% | 32% |
Jiangling Motors Co., Ltd.
□Applicable □√Not Applicable
4.The specific implementation of share repurchase during the reporting periodThe implementation progress of share repurchase
□Applicable □√Not Applicable
The implementation progress of the reduction of the shares repurchase throughcentralized bidding
□Applicable □√Not Applicable
Chapter VIII Preferred Shares
□Applicable □√Not Applicable
JMC had no preferred shares in the reporting period.
Chapter IX Bond related Information
□Applicable √Not Applicable
Chapter X Financial Statements
| Type of Audit Report | Standard and Unqualified Opinion |
| Signature date | March 28, 2023 |
| Name of Auditor | PricewaterhouseCoopers Zhong Tian LLP |
| Document No. of Audit Report | PwC ZT Shen Zi (2023) No. 10080 |
[English Translation for Reference Only]
Auditor’s Report
PwC ZT Shen Zi (2023) No. 10080
(Page 1 of 5)
To the shareholders of Jiangling Motors Corporation, Ltd.,
Opinion
What we have audited
We have audited the accompanying financial statements of Jiangling Motors Corporation, Ltd.(hereinafter “Jiangling Motors”), which comprise:
? the consolidated and company balance sheets as at 31 December 2022;? the consolidated and company income statements for the year then ended;? the consolidated and company cash flow statements for the year then ended;? the consolidated and company statements of changes in shareholder’s equity for the yearthen ended; and? notes to the financial statements.
Our opinion
In our opinion, the accompanying financial statements present fairly, in all material respects, theconsolidated and company’s financial position of Jiangling Motors as at 31 December 2022, andtheir financial performance and cash flows for the year then ended in accordance with therequirements of Accounting Standards for Business Enterprises (“CASs”).
Basis for Opinion
We conducted our audit in accordance with China Standards on Auditing (“CSAs”). Ourresponsibilities under those standards are further described in the Auditor’s Responsibilities forthe Audit of the Financial Statements section of our report. We believe that the audit evidence wehave obtained is sufficient and appropriate to provide a basis for our opinion.
We are independent of Jiangling Motors in accordance with the Code of Ethics for ProfessionalAccountants of the Chinese Institute of Certified Public Accountants (“CICPA Code”), and we havefulfilled our other ethical responsibilities in accordance with the CICPA Code.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significancein our audit of the financial statements of the current period. These matters were addressed in thecontext of our audit of the financial statements as a whole, and in forming our opinion thereon,and we do not provide a separate opinion on these matters.
Key audit matters identified in our audit is Expenditures on research and development.
PwC ZT Shen Zi (2023) No. 10080
(Page 2 of 5)
Key Audit Matters (Cont’d)
| Key Audit Matters | How our audit addressed the Key Audit Matter |
| Expenditures on research and development Please refer to Note 2(14)(e) and Note 4(17) to the financial statements. The amount of expenditures on research and development was RMB2,018,500,532 during the year ended 31 December 2022, of which RMB535,170,902 was capitalised. As of 31 December 2022, the balance of development expenditures amounted to RMB477,233,877. We identified the expenditures on research and development as key audit matter due to the significant amount of expenditure of research and development incurred, a portion of which being capitalised and the fact that there is significant management’s judgment involved in assessing whether the criteria of capitalisation have been met, particularly included: ? Technical feasibility of the project ? Likelihood of the generating of sufficient future economic benefits ? Timing of the capitalisation | The audit procedures we performed on expenditures on research and development included: We understood, evaluated, and tested the internal controls related to the expenditures on research and development. We obtained the breakdown of expenditures of research and development by project and traced them to the amounts of research and development expenses incurred and the amounts capitalised recorded in the general ledger. We performed the following tests on a sample basis: ? We obtained the details of expenses by nature on selected projects and inspected the supporting documents such as contracts and invoices. ? We understood the cost allocation method of the research and development for each project, reviewed the process of the collection and allocation of indirect expenses, and verified the reasonableness the indirect expenses attributable to relevant projects, including employment costs and depreciation expenses. ? We compared the recorded research and development costs of the projects to their budgets, and confirmed the progress of the project by interviewing with the project managers. ? For projects which development expenditures capitalised, we understood the criteria of capitalisation and the timing of capitalisation determined by management; we interviewed the project managers and reviewed the verification reports and meeting minutes at different stages to further confirm the reasonableness of the judgment of the management; we assessed the technical feasibility of the development project and the likelihood of the generating of sufficient future economic benefits by considering the market information and the Company’s successful development experience in the past. Based on the audit procedures performed, the audit evidence we obtained supports the recognition of the expenditures of research and development and management's judgment on capitalisation of the related development expenditures. |
PwC ZT Shen Zi (2023) No. 10080
(Page 3 of 5)
Other Information
Management of Jiangling Motors is responsible for the other information. The other informationcomprises all of the information included in 2022 annual report of Jiangling Motors other than thefinancial statements and our auditor’s report thereon.
Our opinion on the financial statements does not cover the other information and we do not expressany form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the otherinformation and, in doing so, consider whether the other information is materially inconsistent withthe financial statements or our knowledge obtained in the audit or otherwise appears to be materiallymisstated. If, based on the work we have performed, we conclude that there is a materialmisstatement of this other information, we are required to report that fact. We have nothing toreport in this regard.
Responsibilities of Management and the Audit Committee for the Financial Statements
Management of Jiangling Motors is responsible for the preparation and fair presentation of thesefinancial statements in accordance with the CASs, and for such internal control as managementdetermines is necessary to enable the preparation of financial statements that are free from materialmisstatement, whether due to fraud or error.
In preparing these financial statements, management is responsible for assessing Jiangling Motors’sability to continue as a going concern, disclosing, as applicable, matters related to going concern andusing the going concern basis of accounting unless management either intend to liquidate JianglingMotors or to cease operations, or have no realistic alternative but to do so.
The Audit Committee is responsible for overseeing Jiangling Motors’s financial reporting process.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether these financial statements as awhole are free from material misstatement, whether due to fraud or error, and to issue an auditor’sreport that includes our opinion. Reasonable assurance is a high level of assurance, but is not aguarantee that an audit conducted in accordance with CSAs will always detect a materialmisstatement when it exists. Misstatements can arise from fraud or error and are consideredmaterial if, individually or in the aggregate, they could reasonably be expected to influence theeconomic decisions of users taken on the basis of these financial statements.
PwC ZT Shen Zi (2023) No. 10080
(Page 4 of 5)
Auditor’s Responsibilities for the Audit of the Financial Statements(Cont’d)
As part of an audit in accordance with CSAs, we exercise professional judgment and maintainprofessional scepticism throughout the audit. We also:
? Identify and assess the risks of material misstatement of the financial statements, whether
due to fraud or error, design and perform audit procedures responsive to those risks, andobtain audit evidence that is sufficient and appropriate to provide a basis for our opinion.The risk of not detecting a material misstatement resulting from fraud is higher than for oneresulting from error, as fraud may involve collusion, forgery, intentional omissions,misrepresentations, or the override of internal control.
? Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances.
? Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by management.
? Conclude on the appropriateness of management’s use of the going concern basis ofaccounting and, based on the audit evidence obtained, whether a material uncertainty existsrelated to events or conditions that may cast significant doubt on Jiangling Motors’s abilityto continue as a going concern. If we conclude that a material uncertainty exists, we arerequired to draw attention in our auditor’s report to the related disclosures in these financialstatements or, if such disclosures are inadequate, to modify our opinion. Our conclusions arebased on the audit evidence obtained up to the date of our auditor’s report. However, futureevents or conditions may cause Jiangling Motors to cease to continue as a going concern.
? Evaluate the overall presentation (including the disclosures), structure and content of thefinancial statements, and whether the financial statements represent the underlyingtransactions and events in a manner that achieves fair presentation.
? Obtain sufficient appropriate audit evidence regarding the financial information of theentities or business activities within Jiangling Motors to express an opinion on the financialstatements. We are responsible for the direction, supervision and performance of the groupaudit. We remain solely responsible for our audit opinion.
We communicate with the Audit Committee regarding, among other matters, the planned scope andtiming of the audit and significant audit findings, including any significant deficiencies in internalcontrol that we identify during our audit.
We also provide the Audit Committee with a statement that we have complied with relevant ethicalrequirements regarding independence, and to communicate with them all relationships and othermatters that may reasonably be thought to bear on our independence, and where applicable, relatedsafeguards.
PwC ZT Shen Zi (2023) No. 10080
(Page 5 of 5)
Auditor’s Responsibilities for the Audit of the Financial Statements (Cont’d)
From the matters communicated with the Audit Committee, we determine those matters that were ofmost significance in the audit of the financial statements of the current period and are therefore thekey audit matters. We describe these matters in our auditor’s report unless law or regulationprecludes public disclosure about the matter or when, in extremely rare circumstances, we determinethat 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.
| PricewaterhouseCoopers Zhong Tian LLP Shanghai, the People’s Republic of China 28 March 2023 | Signing CPA Signing CPA | ——————————— Ye Jun (Engagement Partner) ——————————— Xiao Minjie |
CONSOLIDATED FINANCIAL STATEMENTS ANDREPORT OF THE AUDITORS
31 DECEMBER 2022
JIANGLING MOTORS CORPORATION, LTD.CONSOLIDATED AND COMPANY BALANCE SHEETS AS AT 31 DECEMBER 2022(All amounts in RMB Yuan unless otherwise stated)
| Assets | Notes | 31 December2022 Consolidated | 31 December 2021 Consolidated | 31 December 2022 Company | 31 December 2021 Company |
| Current assets | |||||
| Cash and cash equivalents | 4(1) | 8,604,977,725 | 9,569,051,314 | 6,910,646,428 | 7,706,280,711 |
| Financial assets held for trading | 4(2) | - | 100,242,329 | - | - |
| Derivative financial assets | 4(3) | 2,972,698 | - | 2,972,698 | - |
| Notes receivable | 4(4) | 742,752,730 | 119,783,900 | 1,099,742,888 | 300,000,000 |
| Accounts receivable | 4(5)、14(1) | 4,245,541,752 | 2,994,798,227 | 2,368,898,327 | 1,409,320,240 |
| Financing receivables | 4(6) | 376,662,817 | 201,511,670 | 56,868,760 | 13,725,275 |
| Advances to suppliers | 4(7) | 277,743,526 | 497,302,198 | 277,278,672 | 496,546,531 |
| Other receivables | 4(8)、14(2) | 111,063,372 | 399,983,736 | 128,855,851 | 400,787,837 |
| Inventories | 4(9) | 2,129,040,820 | 1,974,728,632 | 2,129,040,820 | 1,974,728,632 |
| Current portion of non-current assets | 4(11) | 13,851,634 | 13,236,153 | 13,851,634 | 13,236,153 |
| Other current assets | 4(10) | 1,362,502,624 | 984,174,056 | 1,310,164,197 | 881,324,652 |
| Total current assets | 17,867,109,698 | 16,854,812,215 | 14,298,320,275 | 13,195,950,031 | |
| Non-current assets | |||||
| Long-term receivables | 4(12) | 31,148,044 | 44,952,638 | 31,148,044 | 44,952,638 |
| Long-term equity investments | 4(13)、14(3) | 248,482,822 | 257,251,255 | 1,146,033,812 | 1,103,802,245 |
| Fixed assets | 4(14) | 5,446,384,369 | 6,029,302,031 | 4,961,529,936 | 5,497,170,652 |
| Construction in progress | 4(15) | 718,612,190 | 448,338,672 | 688,385,553 | 448,112,420 |
| Right-of-use assets | 4(16) | 233,622,890 | 306,225,810 | 232,666,362 | 304,449,400 |
| Intangible assets | 4(17) | 1,195,005,752 | 1,073,881,961 | 971,966,227 | 844,988,965 |
| Development expenditures | 4(17) | 477,233,877 | 111,004,350 | 477,233,877 | 111,004,350 |
| Deferred tax assets | 4(18) | 1,250,722,193 | 1,233,315,188 | 235,320,874 | 285,288,625 |
| Total non-current assets | 9,601,212,137 | 9,504,271,905 | 8,744,284,685 | 8,639,769,295 | |
| TOTAL ASSETS | 27,468,321,835 | 26,359,084,120 | 23,042,604,960 | 21,835,719,326 |
JIANGLING MOTORS CORPORATION, LTD.CONSOLIDATED AND COMPANY BALANCE SHEETS (CONT'D) AS AT 31 DECEMBER 2022(All amounts in RMB Yuan unless otherwise stated))
| Liabilities and equity | Notes | 31 December 2022 Consolidated | 31 December 2021 Consolidated | 31 December 2022 Company | 31 December 2021 Company |
| Current liabilities | |||||
| Short-term borrowings | 4(20) | 1,100,000,000 | 300,000,000 | 1,100,000,000 | 300,000,000 |
| Derivative financial liabilities | 4(3) | - | 10,704,619 | - | 10,704,619 |
| Accounts payable | 4(21) | 9,015,978,354 | 9,702,584,830 | 9,015,584,820 | 9,702,584,830 |
| Contract liabilities | 4(22) | 152,065,025 | 272,274,177 | 1,011,195 | 67,392,485 |
| Employee benefits payable | 4(23) | 915,703,680 | 766,986,525 | 824,364,157 | 690,921,936 |
| Taxes payable | 4(24) | 193,249,604 | 287,171,720 | 110,894,972 | 111,626,950 |
| Other payables | 4(25) | 5,672,708,511 | 5,253,800,805 | 2,418,186,421 | 1,985,838,271 |
| Current portion of non-current liabilities | 4(26) | 72,680,756 | 78,039,188 | 71,491,054 | 76,893,591 |
| Other current liabilities | 4(27) | 386,889,542 | 420,456,813 | 29,814,619 | 35,663,765 |
| Total current liabilities | 17,509,275,472 | 17,092,018,677 | 13,571,347,238 | 12,981,626,447 | |
| Non-current liabilities | |||||
| Long-term borrowings | 4(28) | 20,858,057 | 2,087,537 | 20,858,057 | 2,087,537 |
| Lease liabilities | 4(29) | 193,090,351 | 263,409,414 | 192,887,339 | 262,016,700 |
| Provisions | 4(30) | 250,762,589 | 197,587,164 | - | - |
| Deferred income | 4(31) | 60,849,643 | 49,074,545 | 60,849,643 | 49,074,545 |
| Long-term employee benefits payable | 4(32) | 51,293,000 | 55,684,000 | 51,067,000 | 55,370,000 |
| Deferred tax liabilities | 4(18) | 23,305,359 | 24,000,545 | - | - |
| Other non-current liabilities | 4(33) | 118,240,580 | 119,777,649 | - | 108,673,373 |
| Total non-current liabilities | 718,399,579 | 711,620,854 | 325,662,039 | 477,222,155 | |
| Total liabilities | 18,227,675,051 | 17,803,639,531 | 13,897,009,277 | 13,458,848,602 | |
| Equity | |||||
| Share capital | 4(34) | 863,214,000 | 863,214,000 | 863,214,000 | 863,214,000 |
| Capital surplus | 4(35) | 839,442,490 | 839,442,490 | 839,442,490 | 839,442,490 |
| Other comprehensive income | 4(36) | (13,484,250) | (16,422,750) | (13,844,250) | (16,684,500) |
| Surplus reserve | 4(37) | 431,607,000 | 431,607,000 | 431,607,000 | 431,607,000 |
| Retained earnings | 4(38) | 7,123,038,093 | 6,437,603,849 | 7,025,176,443 | 6,259,291,734 |
| Total equity attributable to shareholders of the Company | 9,243,817,333 | 8,555,444,589 | 9,145,595,683 | 8,376,870,724 | |
| Minority interests | (3,170,549) | - | - | - | |
| Total equity | 9,240,646,784 | 8,555,444,589 | 9,145,595,683 | 8,376,870,724 | |
| TOTAL LIABILITIES AND EQUITY | 27,468,321,835 | 26,359,084,120 | 23,042,604,960 | 21,835,719,326 |
Legal representative：Qiu Tiangao CFO：Joey Zhu Finance Department：Ding Ni
JIANGLING MOTORS CORPORATION, LTD.CONSOLIDATED AND COMPANY INCOME STATEMENTS FOR THE YEAR ENDED 31DECEMBER 2022(All amounts in RMB Yuan unless otherwise stated)
| Item | Notes | 2022 Consolidated | 2021 Consolidated | 2022 Company | 2021 Company |
| Revenue | 4(39)、14(4) | 30,100,283,842 | 35,221,306,472 | 28,100,997,449 | 32,892,038,392 |
| Less: Cost of sales | 4(39)、4(45)、14(4) | (25,812,264,868) | (30,117,454,367) | (25,020,438,748) | (29,110,316,368) |
| Taxes and surcharges | 4(40) | (951,394,115) | (968,148,993) | (919,835,457) | (928,747,793) |
| Selling and distribution expenses | 4(41)、4(45) | (1,444,894,711) | (1,531,808,043) | (171,729,499) | (247,250,188) |
| General and administrative expenses | 4(42)、4(45) | (964,786,345) | (1,152,218,590) | (875,592,926) | (993,790,073) |
| Research and development expenses | 4(43)、4(45) | (1,483,329,630) | (1,709,014,171) | (1,483,329,630) | (1,696,132,130) |
| Financial expenses | 4(44) | 163,907,346 | 295,755,557 | 108,526,076 | 212,372,641 |
| Including: Interest expenses | (49,305,209) | (23,640,234) | (49,225,042) | (23,561,570) | |
| Interest income | 236,308,959 | 300,401,839 | 180,329,362 | 216,746,764 | |
| Add: Other income | 4(48) | 943,326,556 | 551,071,245 | 942,054,079 | 550,726,007 |
| Investment income | 4(49)、14(5) | (36,082,647) | (568,716) | (35,294,097) | (46,544,278) |
| Including: Share of profit of associates and joint ventures | (8,768,433) | (22,245,293) | (8,768,433) | (21,475,697) | |
| Gains on changes in fair value | 4(50) | 13,434,988 | (10,638,548) | 13,677,317 | (9,785,809) |
| Credit impairment losses | 4(47) | (12,066,846) | 14,328,162 | 5,631,231 | 3,505,404 |
| Asset impairment losses | 4(46) | (7,242,768) | (43,273,452) | (7,242,768) | (1,422,816,945) |
| Gains on disposal of assets | 4(51) | 391,369,117 | 16,977,005 | 391,709,115 | 26,312,882 |
| Operating profit | 900,259,919 | 566,313,561 | 1,049,132,142 | (770,428,258) | |
| Add: Non-operating income | 4(52) | 3,788,268 | 4,606,837 | 383,365 | 2,363,699 |
| Less: Non-operating expenses | 4(53) | (4,481,962) | (14,448,952) | (4,455,773) | (14,140,968) |
| Total profit | 899,566,225 | 556,471,446 | 1,045,059,734 | (782,205,527) | |
| Less: Income tax expenses | 4(54) | (36,687,606) | 17,694,498 | (49,560,101) | 15,547,022 |
| Net profit | 862,878,619 | 574,165,944 | 995,499,633 | (766,658,505) | |
| Classified by continuity of operations | |||||
| Net profit from continuing operations | 862,878,619 | 574,165,944 | 995,499,633 | (766,658,505) | |
| Net profit from discontinued operations | - | - | - | - | |
| Classified by ownership of the equity | |||||
| Minority interests | (52,170,549) | - | - | - | |
| Attributable to shareholders of the Company | 915,049,168 | 574,165,944 | 995,499,633 | (766,658,505) | |
| Other comprehensive income, net of tax | 2,938,500 | (4,663,500) | 2,840,250 | (4,662,750) | |
| Attributable to shareholders of the Company | |||||
| Other comprehensive income items which will not be reclassified to profit or loss | |||||
| Changes arising from remeasurement of defined benefit plan | 4(36) | 2,938,500 | (4,663,500) | 2,840,250 | (4,662,750) |
| Attributable to minority interests | - | - | - | - | |
| Total comprehensive income | 865,817,119 | 569,502,444 | 998,339,883 | (771,321,255) | |
| Attributable to shareholders of the Company | 917,987,668 | 569,502,444 | 998,339,883 | (771,321,255) | |
| Attributable to minority interests | (52,170,549) | - | - | - | |
| Earnings per share | |||||
| Basic earnings per share (RMB Yuan) | 4(55) | 1.06 | 0.67 | —— | —— |
| Diluted earnings per share (RMB Yuan) | 4(55) | 1.06 | 0.67 | —— | —— |
Legal representative：Qiu Tiangao CFO：Joey Zhu Finance Department：Ding Ni
JIANGLING MOTORS CORPORATION, LTD.CONSOLIDATED AND COMPANY CASH FLOW STATEMENTS FOR THE YEAR ENDED31 DECEMBER 2022(All amounts in RMB Yuan unless otherwise stated)
| Item | Notes | 2022 Consolidated | 2021 Consolidated | 2022 Company | 2021 Company |
| Cash flows (uesd in)/generated from operating activities | |||||
| Cash received from sales of goods or rendering of services | 30,379,935,542 | 39,004,121,378 | 28,500,883,020 | 37,770,178,605 | |
| Refunds of taxes | 186,230,096 | - | 139,724,259 | - | |
| Cash received relating to other operating activities | 4(56) | 1,048,761,411 | 736,780,886 | 1,012,041,891 | 613,181,977 |
| Sub-total of cash inflows | 31,614,927,049 | 39,740,902,264 | 29,652,649,170 | 38,383,360,582 | |
| Cash paid for goods and services | (26,012,469,683) | (30,184,229,122) | (25,251,565,747) | (29,501,916,289) | |
| Cash paid to and on behalf of employees | (2,236,265,303) | (2,621,245,572) | (2,042,877,671) | (2,458,757,584) | |
| Payments of taxes and surcharges | (2,208,513,599) | (2,262,657,388) | (1,895,305,960) | (1,819,787,242) | |
| Cash paid relating to other operating activities | 4(56) | (2,676,252,416) | (2,912,577,172) | (1,545,847,293) | (1,742,292,716) |
| Sub-total of cash outflows | (33,133,501,001) | (37,980,709,254) | (30,735,596,671) | (35,522,753,831) | |
| Net cash flows (uesd in)/generated from operating activities | 4(57) | (1,518,573,952) | 1,760,193,010 | (1,082,947,501) | 2,860,606,751 |
| Cash flows generated uesd in investing activities | |||||
| Cash received from disposal of investments | 200,000,000 | 2,500,000,000 | - | 2,142,000,000 | |
| Cash received from returns on investments | 1,523,836 | 15,174,593 | - | 3,894,456 | |
| Net cash received from disposal of fixed assets, intangible assets and other long-term assets | 783,318,054 | 37,460,481 | 782,994,506 | 36,440,992 | |
| Cash received from disposal of subsidiaries and other business units | 191,100,000 | 84,615,031 | 191,100,000 | 108,000,000 | |
| Cash received relating to other investing activities | 4(56) | 231,280,443 | 278,704,216 | 181,238,794 | 215,581,457 |
| Sub-total of cash inflows | 1,407,222,333 | 2,915,954,321 | 1,155,333,300 | 2,505,916,905 | |
| Cash paid to acquire fixed assets, intangible assets and other long-term assets | (1,380,537,113) | (1,169,407,698) | (1,377,197,659) | (1,158,649,784) | |
| Cash paid to acquire investments | (100,000,000) | (1,800,000,000) | (55,924,647) | (1,720,252,413) | |
| Cash paid relating to other investing activities | (15,828,699) | (25,184,522) | (15,828,699) | (20,697,147) | |
| Sub-total of cash outflows | (1,496,365,812) | (2,994,592,220) | (1,448,951,005) | (2,899,599,344) | |
| Net cash flows generated uesd in investing activities | (89,143,479) | (78,637,899) | (293,617,705) | (393,682,439) | |
| Cash flows generated from/(uesd in) financing activities | |||||
| Cash received from absorbing investments | 49,000,000 | - | - | - | |
| Including: cash received by the subsidiary from absorbing minority shareholders' investment | 49,000,000 | - | - | - | |
| Cash received from borrowings | 4,682,667,661 | 1,484,497,639 | 4,682,667,661 | 1,484,497,639 | |
| Sub-total of cash inflows | 4,731,667,661 | 1,484,497,639 | 4,682,667,661 | 1,484,497,639 | |
| Cash repayments of borrowings | (3,900,441,579) | (1,700,425,493) | (3,900,441,579) | (1,700,425,493) | |
| Cash payments for distribution of dividends, profits or interest expenses | (230,386,002) | (3,002,467,779) | (230,386,002) | (3,002,467,779) | |
| Cash paid relating to other financing activities | 4(56) | (18,980,309) | (16,063,293) | (17,978,248) | (15,810,013) |
| Sub-total of cash outflows | (4,149,807,890) | (4,718,956,565) | (4,148,805,829) | (4,718,703,285) | |
| Net cash flows generated from/(uesd in) financing activities | 581,859,771 | (3,234,458,926) | 533,861,832 | (3,234,205,646) | |
| Effect of foreign exchange rate changes on cash and cash equivalents | - | - | - | - | |
| Net decrease in cash and cash equivalents | 4(57) | (1,025,857,660) | (1,552,903,815) | (842,703,374) | (767,281,334) |
| Add: Cash and cash equivalents at beginning of year | 4(57) | 9,569,051,314 | 11,121,955,129 | 7,706,280,711 | 8,473,562,045 |
| Cash and cash equivalents at end of year | 4(57) | 8,543,193,654 | 9,569,051,314 | 6,863,577,337 | 7,706,280,711 |
Legal representative：Qiu Tiangao CFO：Joey Zhu Finance Department：Ding Ni
JIANGLING MOTORS CORPORATION, LTD.CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMB Yuan unless otherwise stated)
| Item | Notes | Attributable to shareholders of the parent company | Minority interests | Total equity | ||||
| Share capital | Capital surplus | Other comprehensive income | Surplus reserve | Retained earnings | ||||
| Balance at 1 January 2021 | 863,214,000 | 839,442,490 | (11,759,250) | 431,607,000 | 8,863,969,769 | - | 10,986,474,009 | |
| Movements for the year ended 31 December 2021 | - | - | (4,663,500) | - | (2,426,365,920) | - | (2,431,029,420) | |
| Total comprehensive income | ||||||||
| Net profit | - | - | - | - | 574,165,944 | - | 574,165,944 | |
| Other comprehensive income | - | - | (4,663,500) | - | - | - | (4,663,500) | |
| Total comprehensive income for the year | - | - | (4,663,500) | - | 574,165,944 | - | 569,502,444 | |
| Profit distribution | ||||||||
| Distribution to shareholders | 4(38) | - | - | - | - | (3,000,531,864) | - | (3,000,531,864) |
| Balance at 31 December 2021 | 863,214,000 | 839,442,490 | (16,422,750) | 431,607,000 | 6,437,603,849 | - | 8,555,444,589 | |
| Balance at 1 January 2022 | 863,214,000 | 839,442,490 | (16,422,750) | 431,607,000 | 6,437,603,849 | - | 8,555,444,589 | |
| Movements for the year ended 31 December 2022 | - | - | 2,938,500 | - | 685,434,244 | (3,170,549) | 685,202,195 | |
| Total comprehensive income | ||||||||
| Net profit/(loss) | - | - | - | - | 915,049,168 | (52,170,549) | 862,878,619 | |
| Other comprehensive income | - | - | 2,938,500 | - | - | - | 2,938,500 | |
| Total comprehensive income for the year | - | - | 2,938,500 | - | 915,049,168 | (52,170,549) | 865,817,119 | |
| Capital contributed by owners and capital decreases | ||||||||
| Capital invested by shareholders | 4(38) | - | - | - | - | - | 49,000,000 | 49,000,000 |
| Profit distribution | ||||||||
| Distribution to shareholders | - | - | - | - | (229,614,924) | - | (229,614,924) | |
| Balance at 31 December 2022 | 863,214,000 | 839,442,490 | (13,484,250) | 431,607,000 | 7,123,038,093 | (3,170,549) | 9,240,646,784 | |
Legal representative：Qiu Tiangao CFO：Joey Zhu Finance Department：Ding Ni
JIANGLING MOTORS CORPORATION, LTD.COMPANY STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMB unless otherwise stated)
| Item | Notes | Share capital | Capital surplus | Other comprehensive income | Surplus reserve | Retained earnings | Total equity |
| Balance at 1 January 2021 | 863,214,000 | 839,442,490 | (12,021,750) | 431,607,000 | 10,032,100,709 | 12,154,342,449 | |
| Movements for the year ended 31 December 2021 | - | - | (4,662,750) | - | (3,772,808,975) | (3,777,471,725) | |
| Total comprehensive income | |||||||
| Net profit | - | - | - | - | (766,658,505) | (766,658,505) | |
| Other comprehensive income | - | - | (4,662,750) | - | - | (4,662,750) | |
| Total comprehensive income for the year | - | - | (4,662,750) | - | (766,658,505) | (771,321,255) | |
| Profit distribution | |||||||
| Distribution to shareholders | 4(38) | - | - | - | - | (3,000,531,864) | (3,000,531,864) |
| Others | - | - | - | - | (5,618,606) | (5,618,606) | |
| Balance at 31 December 2021 | 863,214,000 | 839,442,490 | (16,684,500) | 431,607,000 | 6,259,291,734 | 8,376,870,724 | |
| Balance at 1 January 2022 | 863,214,000 | 839,442,490 | (16,684,500) | 431,607,000 | 6,259,291,734 | 8,376,870,724 | |
| Movements for the year ended 31 December 2022 | - | - | 2,840,250 | - | 765,884,709 | 768,724,959 | |
| Total comprehensive income | |||||||
| Net profit | - | - | - | - | 995,499,633 | 995,499,633 | |
| Other comprehensive income | - | - | 2,840,250 | - | - | 2,840,250 | |
| Total comprehensive income for the year | - | - | 2,840,250 | - | 995,499,633 | 998,339,883 | |
| Profit distribution | |||||||
| Distribution to shareholders | 4(38) | - | - | - | - | (229,614,924) | (229,614,924) |
| Balance at 31 December 2022 | 863,214,000 | 839,442,490 | (13,844,250) | 431,607,000 | 7,025,176,443 | 9,145,595,683 |
Legal representative：Qiu Tiangao CFO：Joey Zhu Finance Department：Ding Ni
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022
(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 1 | General information |
| Jiangling Motors Corporation, Ltd. (hereinafter “the Company”) is a Sino-foreign joint stock enterprise established under the approval of Hong ban (1992) No. 005 of Nanchang Revolution and Authorisation Group of Company’s Joint Stock on the basis of Jiangxi Motors Manufacturing Factory on 16 June 1992. The registration number of the enterprise business license is No. 913600006124469438. The registered address of the Company and the address of its headquarters are both Nanchang City, Jiangxi Province of the People’s Republic of China (“the PRC”). | |
| On 23 July 1993, with the approval of the China Securities Regulatory Commission (hereinafter “CSRC”) (Zheng Jian Fa Shen Zi [1993] No. 22) and (Zheng Jian Han Zi [1993] No. 86), the Company was listed on the Stock Exchange of Shenzhen on 1 December 1993, issuing 494,000,000 shares in total. On 8 April 1994, a total of 25,214,000 shares were distributed for the 1993 dividend distribution programme with the approval of the shareholders’ meeting and Jiangxi Securities Management Leading Group (Gan Securities [1994] No. 02). In 1995, with the approval of CSRC (Zheng Jian Fa Zi [1995] No. 144) and the Shenzhen Securities Management Office (Shenzhen Office Fu [1995] No. 92), the Company issued 174,000,000 ordinary shares (“B shares”). In 1998, with the approval of CSRC (Zheng Jian Fa Zi [1998] No. 19), the Company issued additional 170,000,000 B shares. | |
| According to the resolution of the shareholders’ meeting regarding the split share structure reform on 11 January 2006, the Company implemented the Scheme on Split Share Structure Reform on 13 February 2006. After the implementation, the Company’s total paid-in capital remains the same. Related details are disclosed in Note 4(34). | |
| As at 31 December 2022, the Company’s paid-in capital totalled RMB863,214,000, with par value of RMB1 per share. | |
| The business scope of the Company and its subsidiaries (hereinafter “the Group”) includes production and sales of automobile assemblies such as automobiles, special (modified) vehicles, engines and chassis and other automobile parts, and provision of related after-sales services; retail and wholesale of imported FORD E series automobiles of Ford Motor (China) Co., Ltd. as the dealer; import and export of automobiles and parts; dealership of used cars; provision of enterprise management and consulting services related to production and sales of automobiles. | |
| Subsidiaries included in the consolidation scope for the current year are detailed in Note 5. | |
| These financial statements were authorised for issue by the Company's Board of Directors on March 28 2023. | |
| 2 | Summary of significant accounting policies and accounting estimates |
| The Group determines specific accounting policies and estimates based on the features of its production and operation, which mainly comprise the measurement of expected credit losses (“ECL”) on receivables (Note 2(8)), valuation of inventories (Note 2(9)), depreciation of fixed assets and amortisation of intangible assets and right-of-use assets (Note 2(11), (14), (22)), criteria for capitalisation of development expenditures (Note 2(14)), recognition and measurement of revenue (Note 2(19)), etc. Key judgements and critical accounting estimates and key assumptions applied by the Group on the determination of significant accounting policies are set out in Note 2(25). |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 2 | Summary of significant accounting policies and accounting estimates (Cont’d) |
| (1) | Basis of preparation |
| The financial statements are prepared in accordance with the Accounting Standard for Business Enterprises - Basic Standard, specific accounting standards and relevant regulations issued by the Ministry of Finance on 15 February 2006 and in subsequent periods (hereinafter collectively referred to as “the Accounting Standards for Business Enterprises” or “CASs”) and the disclosure requirements in the Preparation Convention of Information Disclosure by Companies Offering Securities to the Public No.15 - General Rules on Financial Reporting issued by CSRC. These financial statements have been prepared on a going concern basis. | |
| (2) | Statement of compliance with the Accounting Standards for Business Enterprises |
| The financial statements of the Company for the year ended 31 December 2022 are in compliance with the Accounting Standards for Business Enterprises, and truly and completely present the consolidated and company’s financial position of the Company as at 31 December 2022 and their financial performance, cash flows and other information for the year then ended. | |
| (3) | Fiscal year |
| The Company’s fiscal year starts on 1 January and ends on 31 December. | |
| (4) | Recording currency |
| The recording currency of the company and its subsidiaries is Renminbi (“RMB”). The financial statements are presented in RMB. | |
| (5) | Preparation of consolidated financial statements |
| The consolidated financial statements comprise the financial statements of the Company and all of its subsidiaries. | |
| Subsidiaries are consolidated from the date on which the Group obtains control and are de-consolidated from the date that such control ceases. For a subsidiary that is acquired in a business combination involving enterprises under common control, it is included in the consolidated financial statements from the date when it, together with the Company, comes under common control of the ultimate controlling party. The portion of the net profits realised before the combination date is presented separately in the consolidated income statement. | |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 2 | Summary of significant accounting policies and accounting estimates (Cont’d) |
| (5) | Preparation of consolidated financial statements (Cont'd) |
| In preparing the consolidated financial statements, where the accounting policies or the accounting periods of the Company and subsidiaries are inconsistent, the financial statements of the subsidiaries are adjusted in accordance with the accounting policies and the accounting period of the Company. For subsidiaries acquired from business combinations involving enterprises not under common control, the individual financial statements of the subsidiaries are adjusted based on the fair value of the identifiable net assets at the acquisition date. | |
| All significant intra-group balances, transactions and unrealised profits are eliminated in the consolidated financial statements. The portion of subsidiaries’ shareholders' equity and the portion of subsidiaries’ net profits and losses and comprehensive income for the period not attributable to the Company are recognised as minority interests, net profit attributed to minority interests and total comprehensive income attributed to minority interests, and presented separately in the consolidated financial statements under shareholders' equity, net profits and total comprehensive income respectively. If the subsidiaries’ loss for the current period attributed to the minority shareholders exceeds their share in the opening shareholder’s equity, the excess will be deducted against the minority interests. Unrealised profits and losses resulting from the sales of assets by the Company to its subsidiaries are fully eliminated against net profit attributable to owners of the parent. Unrealised profits and losses resulting from the sales of assets by a subsidiary to the Company are eliminated and allocated between net profit attributable to owners of the parent and net profit attributed to minority interests in accordance with the allocation proportion of the parent in the subsidiary. Unrealised profits and losses resulting from the sales of assets by one subsidiary to another are eliminated and allocated between net profit attributable to owners of the parent and net profit attributed to minority interests in accordance with the allocation proportion of the parent in the subsidiary. If the accounting treatment of a transaction is inconsistent in the financial statements at the Group level and at the Company or its subsidiary level, adjustment will be made from the perspective of the Group. | |
| The Group remeasure the remaining investment held at its fair value in the consolidated statement of financial position when the control is lost because of the partially disposal of the equity or other reasons. The difference between the consideration of the disposal as well as the fair value of the remaining investment and the share of net assets of the former subsidiary calculated based on the original share since the acquisition date as well as the good will is recognised in investment income in the period of control lost. In addition, the other comprehensive income and other changes in owner's equity related to the investment of the former subsidiary, are reclassified to profit or loss when the control is lost, except for the changes arising from remeasurement of net liabilities or net assets of defined benefit, the accumulated changes in fair value from the equity instruments not held for trading and designated as financial assets at fair value through other comprehensive income by the investee. | |
| (6) | Cash and cash equivalents |
| Cash and cash equivalents comprise cash on hand, deposits that can be readily drawn on demand, and short-term and highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. | |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022
(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 2 | Summary of significant accounting policies and accounting estimates (Cont’d) |
| (7) | Foreign currency translation |
| Foreign currency transactions | |
| Foreign currency transactions are translated into recording currency using the exchange rates prevailing at the dates of the transactions. | |
| At the balance sheet date, monetary items denominated in foreign currencies are translated into recording currency using the spot exchange rates on the balance sheet date. Exchange differences arising from these translations are recognised in profit or loss for the current period, except for those attributable to foreign currency borrowings that have been taken out specifically for acquisition or construction of qualifying assets, which are capitalised as part of the cost of those assets. Non-monetary items denominated in foreign currencies that are measured at historical costs are translated at the balance sheet date using the spot exchange rates at the date of the transactions. The effect of exchange rate changes on cash is presented separately in the cash flow statement. |
| (8) | Financial instruments |
| A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity. A financial asset or a financial liability is recognised when the Group becomes a party to the contractual provisions of the instrument. | |
| (a) | Financial assets |
| (i) | Classification and measurement |
| Based on the business model for managing the financial assets and the contractual cash flow characteristics of the financial assets, financial assets are classified as: (1) financial assets at amortised cost; (2) financial assets at fair value through other comprehensive income; (3) financial assets at fair value through profit or loss. | |
| The financial assets are measured at fair value at initial recognition. Related transaction costs that are attributable to the acquisition of the financial assets are included in the initially recognised amounts, except for the financial assets at fair value through profit or loss, the related transaction costs of which are recognised directly in profit or loss for the current period. Accounts receivable or notes receivable arising from sales of products or rendering of services (excluding or without regard to significant financing components) are initially recognised at the consideration that is entitled to be charged by the Group as expected. | |
| Debt instruments | |
| The debt instruments held by the Group refer to the instruments that meet the definition of financial liabilities from the perspective of the issuer, and are measured in the following three ways: | |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| Measured at amortised cost: | |
| The objective of the Group’s business model is to hold the financial assets to collect the contractual cash flows, and the contractual cash flow characteristics are consistent with a basic lending arrangement, which gives rise on specified dates to the contractual cash flows that are solely payments of principal and interest on the principal amount outstanding. The interest income of such financial assets is recognised using the effective interest method. Such financial assets mainly include cash at bank and on hand, notes receivable, accounts receivable, other receivables and long-term receivables, etc. The Group presents long-term receivables that are due within one year from the balance sheet date (including one year) as non-current assets due within one year. |
| Measured at fair value through other comprehensive income: | |
| The objective of the Group’s business model is to hold the financial assets to both collect the contractual cash flows and sell such financial assets, and the contractual cash flow characteristics are consistent with a basic lending arrangement. Such financial assets are measured at fair value through other comprehensive income, except for the impairment gains or losses, foreign exchange gains and losses, and interest income calculated using the effective interest method which are recognised in profit or loss for the current period. Such financial assets mainly include financing receivables, etc. | |
| Measured at fair value through profit or loss: | |
| Debt instruments held by the Group that are not divided into those at amortised cost, or those measured at fair value through other comprehensive income, are measured at fair value through profit or loss. At initial recognition, the Group does not designate a portion of financial assets as at fair value through profit or loss to eliminate or significantly reduce an accounting mismatch. Financial assets that are due in more than one year as from the balance sheet date and are expected to be held for over one year are included in other non-current financial assets, and the others are included in financial assets held for trading. | |
| 2 | Summary of significant accounting policies and accounting estimates (Cont’d) |
| (8) | Financial instruments (Cont’d) |
| (a) | Financial assets (Cont’d) |
| (i) | Classification and measurement (Cont’d) |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 2 | Summary of significant accounting policies and accounting estimates (Cont’d) |
| (8) | Financial instruments (Cont’d) |
| (a) | Financial assets (Cont’d) |
| (ii) | Impairment |
| Loss provision for financial assets at amortised cost and receivables financing at fair value through other comprehensive income is recognised on the basis of ECL. | |
| Giving consideration to reasonable and supportable information that is related to past events, current conditions and forecasts of future economic conditions and is available without undue cost or effort at the balance sheet date, as well as the default risk weight, the Group recognises the ECL as the probability-weighted amount of the present value of the difference between the cash flows receivable from the contract and the cash flows expected to collect. | |
| For notes receivable, accounts receivable and financing receivables arising from sales of goods and rendering of services in the ordinary course of operating activities, the Group recognises the lifetime ECL regardless of whether there exists a significant financing component. | |
| Except for the above-mentioned notes receivable, accounts receivable and financing receivables, as at each balance sheet date, the ECL of financial instruments at different stages are measured respectively. 12-month ECL provision is recognised for financial instruments in Stage 1 that have not had a significant increase in credit risk since initial recognition; lifetime ECL provision is recognised for financial instruments in Stage 2 that have had a significant increase in credit risk yet without credit impairment since initial recognition; and lifetime ECL provision is recognised for financial instruments in Stage 3 that have had credit impairment since initial recognition. | |
| For the financial instruments with low credit risk on the balance sheet date, the Group assumes there is no significant increase in credit risk and identifies it in Stage 1 since initial recognition and recognises the 12-month ECL provision. | |
| For the financial instruments in Stage 1 and Stage 2, the Group calculates the interest income by applying the effective interest rate to the gross carrying amount (before deduction of the impairment provision). For the financial instrument in Stage 3, the interest income is calculated by applying the effective interest rate to the amortised cost (after deduction of the impairment provision from the gross carrying amount). | |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 2 | Summary of significant accounting policies and accounting estimates (Cont’d) | |
| (8) | Financial instruments (Cont’d) | |
| (a) | Financial assets (Cont’d) | |
| (ii) | Impairment (Cont’d) | |
| In case the ECL of an individually assessed financial asset can be evaluated with reasonable cost, the Group determines the ECL based on impairment assessment of an individual financial asset. In case the ECL of an individually assessed financial asset cannot be evaluated with reasonable cost, the Group divides the receivables into certain groupings based on credit risk characteristics, and calculates the ECL for the groupings. Basis for determining groupings and related provision methods are as follows: | ||
| Grouping - Bank acceptance notes | State-owned banks and joint stock banks | |
| Grouping - Trade acceptance notes | Customers purchasing using trade acceptance notes | |
| Grouping - Sales of general automobiles | Customers of general automobiles | |
| Grouping - Sales of new energy automobiles | Customers of new energy automobiles | |
| Grouping - Sales of automobile parts | Customers of automobile parts | |
| Grouping - Other receivables | Other receivables with the same nature | |
| Grouping - Others | Accrued interest on cash at bank | |
| For accounts receivable classified as a portfolio and financing of notes receivable and receivables resulting from daily operating activities such as sale of goods and provision of services, the Group calculates the ECL with reference to historical credit losses experience, current conditions and forecasts of future economic conditions, and based on the exposure at default and the lifetime ECL rate. For other notes receivable, financing receivables and other receivables classified into groupings, the Group calculates the ECL with reference to the historical credit loss experience, current conditions and forecasts of future economic conditions, and based on the exposure at default and the 12-month or lifetime ECL rate. | ||
| The Group recognises the loss provision made or reversed into profit or loss for the current period. For debt instruments held at fair value through other comprehensive income, the Group adjusts other comprehensive income while the impairment loss or gain is recognised in profit or loss for the current period. | ||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022
(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 2 | Summary of significant accounting policies and accounting estimates (Cont’d) |
| (8) | Financial instruments (Cont’d) |
| (a) | Financial assets (Cont’d) |
| (iii) | Derecognition |
| A financial asset is derecognised when: (i) the contractual rights to the cash flows from the financial asset expire, (ii) the financial asset has been transferred and the Group transfers substantially all the risks and rewards of ownership of the financial asset to the transferee, or (iii) the financial asset has been transferred and the Group has not retained control of the financial asset, although the Group neither transfers nor retains substantially all the risks and rewards of ownership of the financial asset. When a financial asset is derecognised, the difference between the carrying amount and the sum of the consideration received and the cumulative changes in fair value that are previously recognised directly in other comprehensive income is recognised in profit or loss for the current period. | |
| (b) | Financial liabilities |
| Financial liabilities are classified as financial liabilities at amortised cost and financial liabilities at fair value through profit or loss at initial recognition. Financial liabilities of the Group mainly comprise financial liabilities at amortised cost, including notes payable, accounts payable, other payables, borrowings, etc. Such financial liabilities are initially recognised at fair value, net of transaction costs incurred, and subsequently measured using the effective interest method. Financial liabilities that are due within one year (inclusive) are classified as current liabilities; those with maturities over one year but are due within one year (inclusive) as from the balance sheet date are classified as current portion of non-current liabilities. Others are classified as non-current liabilities. | |
| A financial liability is derecognised or partly derecognised when the underlying present obligation is discharged or partly discharged. The difference between the carrying amount of the derecognised part of the financial liability and the consideration paid is recognised in profit or loss for the current period. |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 2 | Summary of significant accounting policies and accounting estimates (Cont’d) |
| (8) | Financial instruments (Cont’d) |
| (c) | Determination of fair value of financial instruments |
| 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. In valuation, the Group adopts valuation techniques applicable in the current situation and supported by adequate available data and other information, selects inputs with the same characteristics as those of assets or liabilities considered in relevant transactions of assets or liabilities by market participants, and gives priority to the use of relevant observable inputs. When relevant observable inputs are not available or feasible, unobservable inputs are adopted. |
| (9) | Inventories |
| (a) | Classification |
| Inventories include raw materials, work-in-process, finished goods, low-value consumables, materials in transit and materials on consignment, etc., and are measured at the lower of cost or net realizable value. | |
| (b) | Costing of inventories |
| Cost is determined using the weighted average method. The cost of finished goods and work in progress comprise raw materials, direct labour and systematically allocated production overhead based on the normal production capacity. | |
| (c) | Basis for determining net realisable value of inventories and method for making provision for inventories |
| Provision for inventories is determined at the excess amount of the carrying amounts of the inventories over their net realisable value. Net realisable value is determined based on the estimated selling price in the ordinary course of business, less the estimated costs to completion, estimated contract fulfilment costs and estimated costs necessary to make the sale and related taxes. | |
| (d) | The Group adopts the perpetual inventory system. |
| (e) | Amortisation method of low value consumables |
| Low value consumables are amortised into expenses in full when issued for use. |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022
(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 2 | Summary of significant accounting policies and accounting estimates (Cont’d) |
| (10) | Long-term equity investments |
| Long-term equity investments comprise the Company’s long-term equity investments in its subsidiaries, and the Group’s long-term equity investments in its associates. | |
| Subsidiaries are the investees over which the Company is able to exercise control. Associates are the investees that the Group has a significant influence on their financial and operating decisions. | |
| Investments in subsidiaries are presented using the cost method in the Company’s financial statements, and adjusted to the equity method when preparing the consolidated financial statements. Investments in associates are accounted for using the equity method. | |
| (a) | Determination of investment cost |
| For long-term equity investments acquired through a business combination involving enterprises under common control, the investment cost shall be the absorbing party’s share of the carrying amount of owners’ equity of the party being absorbed in the consolidated financial statements of the ultimate controlling party at the combination date; for long-term equity investments acquired through a business combination not involving enterprises under common control, the investment cost shall be the combination cost. For long-term equity investments acquired not through a business combination, such as long-term equity investments acquired by payment in cash, the initial investment cost shall be the purchase price actually paid; for long-term equity investments acquired by issuing equity securities, the initial investment cost shall be the fair value of the equity securities issued. | |
| (b) | Subsequent measurement and recognition of profit or loss |
| Long-term equity investments accounted for using the cost method are measured at the initial investment cost. Cash dividend or profit distribution declared by an investee is recognised as investment income into profit or loss for the current period. | |
| For long-term equity investments accounted for using the equity method, where the initial investment cost exceeds the Group’s share of the fair value of the investee’s identifiable net assets at the time of acquisition, the investment is initially measured at that cost. Where the initial investment cost is less than the Group’s share of the fair value of the investee’s identifiable net assets at the time of acquisition, the difference is included in profit or loss for the current period and the cost of the long-term equity investment is adjusted upwards accordingly. |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 2 | Summary of significant accounting policies and accounting estimates (Cont’d) |
| (10) | Long-term equity investments (Cont’d) |
| (b) | Subsequent measurement and recognition of profit or loss (Cont’d) |
| For long-term equity investments accounted for using the equity method, the Group recognises the investment income or losses according to its share of net profit or loss of the investee. The Group does not recognise further losses when the carrying amounts of the long-term equity investment together with any long-term interests that, in substance, form part of the Group’s net investment in investees are reduced to zero. However, if the Group has obligations for additional losses and the criteria with respect to recognition of provisions are satisfied, the Group continues recognising the investment losses and the provisions at the amount it expects to undertake. The Group’s share of the changes in investee’s owner's equity other than those arising from the net profit or loss, other comprehensive income and profit distribution is recognised in capital surplus with a corresponding adjustment to the carrying amounts of the long-term equity investment. The carrying amount of the investment is reduced by the Group’s share of the profit distribution or cash dividends declared by the investees. Unrealised gains or losses on transactions between the Group and its investees are eliminated to the extent of the Group’s equity interest in the investees, based on which the investment income or losses are recognised. Any losses resulting from transactions between the Group and its investees, which are attributable to asset impairment losses are not eliminated. | |
| (c) | Basis for determining existence of control and significant influence over investees |
| Control is the power over investees that can bring variable returns through involvement in related activities of investees and the ability to influence the returns by using such power over investees. | |
| Significant influence is the power to participate in making decisions on financial and operating policies of the investee but is not control or joint control over making those policies. | |
| (d) | Impairment of long-term equity investments |
| The carrying amounts of long-term equity investments in subsidiaries and associates is reduced to the recoverable amounts when the recoverable amounts are below their carrying amount (Note 2(15)). | |
| (11) | Fixed assets |
| (a) | Recognition and initial measurement of fixed assets |
| Fixed assets comprise buildings, machinery and equipment, vehicles, moulds, and electronic and other equipment. | |
| Fixed assets are recognised when it is probable that the related economic benefits will flow to the Group and the costs can be reliably measured. Fixed assets purchased or constructed by the Group are initially measured at cost at the time of acquisition. The fixed assets contributed by the state-owned shareholders upon the restructuring of the Company are recorded at the valued amount determined by the state-owned asset administration department. |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 2 | Summary of significant accounting policies and accounting estimates (Cont’d) | |||
| (11) | Fixed assets (Cont’d) | |||
| (a) | Recognition and initial measurement of fixed assets (Cont’d) | |||
| Subsequent expenditures incurred for a fixed asset are included in the cost of the fixed asset when it is probable that the associated economic benefits will flow to the Group and the related cost can be reliably measured. The carrying amount of the replaced part is derecognised. All the other subsequent expenditures are recognised in profit or loss for the period in which they are incurred. | ||||
| (b) | Depreciation methods of fixed assets | |||
| Fixed assets are depreciated using the straight-line method to allocate the cost of the assets to their estimated net residual values over their estimated useful lives. For the fixed assets that have been provided for impairment loss, the related depreciation charge is prospectively determined based upon the adjusted carrying amounts over their remaining useful lives. | ||||
| The estimated useful lives, the estimated net residual values expressed as a percentage of cost and the annual depreciation rates of fixed assets are as follows: | ||||
| Estimated useful lives | Estimated net residual values | Annual depreciation rates | ||
| Buildings | 35 to 40 years | 4% | 2.4% to 2.7% | |
| Machinery and equipment | 10 to 15 years | 4% | 6.4% to 9.6% | |
| Vehicles | 2 to 10 years | 4%-22.32% | 9.6% to 42.2% | |
| Moulds | 5 years | - | 20% | |
| Electronic and other equipment | 5 to 7 years | 4% | 13.7% to 19.2% | |
| The estimated useful life and the estimated net residual value of a fixed asset and the depreciation method applied to the asset are reviewed and adjusted as appropriate at each year-end. | ||||
| (c) | The carrying amount of a fixed asset is reduced to the recoverable amount when the recoverable amount is below the carrying amount (Note 2(15)). | |||
| (d) | Disposal of fixed assets | |||
| A fixed asset is derecognised on disposal or when no future economic benefits are expected from its use or disposal. The amount of proceeds from disposals on sale, transfer, retirement or damage of a fixed asset net of its carrying amount and related taxes and expenses is recognised in profit or loss for the current period. | ||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 2 | Summary of significant accounting policies and accounting estimates (Cont’d) |
| (12) | Construction in progress |
| Construction in progress is measured at actual cost. Actual cost comprises construction costs, installation costs, borrowing costs that are eligible for capitalisation and other costs necessary to bring the construction in progress ready for their intended use. Construction in progress is transferred to fixed assets when the assets are ready for their intended use, and depreciation is charged starting from the following month. The carrying amount of construction in progress is reduced to the recoverable amount when the recoverable amount is below the carrying amount (Note 2(15)). | |
| (13) | Borrowing costs |
| The borrowing costs that are directly attributable to acquisition and construction of an asset that needs a substantially long period of time for its intended use commence to be capitalised and recorded as part of the cost of the asset when expenditures for the asset and borrowing costs have been incurred, and the activities relating to the acquisition and construction that are necessary to prepare the asset for its intended use have commenced. The capitalisation of borrowing costs ceases when the asset under acquisition or construction becomes ready for its intended use and the borrowing costs incurred thereafter are recognised in profit or loss for the current period. Capitalisation of borrowing costs is suspended during periods in which the acquisition or construction of an asset is interrupted abnormally and the interruption lasts for more than 3 months, until the acquisition or construction is resumed. | |
| The capitalised amount of specific borrowings intended to be used for the acquisition and construction of qualifying assets is determined by the interest expenses incurred in the current period less interest income of the unused borrowings deposited at banks or investment income from temporary investments. | |
| The capitalised amount of general borrowings intended to be used for the acquisition or construction of qualifying assets is determined by the weighted average of the excess of accumulated capital expenditure over capital expenditure of the special borrowings multiplied by the weighted average effective interest rate of the utilised general borrowings. The effective interest rate is the rate at which the future cash flows of the borrowings over the expected lifetime or a shorter applicable period are discounted into the initial recognised amount of the borrowings. | |
| (14) | Intangible assets |
| Intangible assets include land use rights, software use fees, non-patent technologies and after-sales service management mode, are measured at cost. | |
| (a) | Land use rights |
| Land use rights are amortised on the straight-line basis over their approved use period of 50 years. If the acquisition costs of the land use rights and the buildings located thereon cannot be reasonably allocated between the land use rights and the buildings, all of the acquisition costs are recognised as fixed assets. |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 2 | Summary of significant accounting policies and accounting estimates (Cont’d) |
| (14) | Intangible assets (Cont’d) |
| (b) | Software use fees |
| Software use fees are amortised on a straight-line basis over the estimated useful life of 5 years. | |
| (c) | Non-patent technologies |
| Non-patent technologies are amortised on the straight-line basis over the estimated useful life of 5 to 7 years. | |
| (d) | Periodical review of useful life and amortisation method |
| For an intangible asset with a finite useful life, review of its useful life and amortisation method is performed at each year-end, with adjustment made appropriately. | |
| (e) | Research and development |
| The expenditure on an internal research and development project is classified into expenditure on the research phase and expenditure on the development phase based on its nature and whether there is material uncertainty that the research and development activities can form an intangible asset at the end of the project. | |
| Expenditure on the research phase related to planned survey, evaluation and selection for research on manufacturing technique of automobile products is recognised in profit or loss in the period in which it is incurred. Prior to mass production, expenditure on the development phase related to the design and testing phase in regard to the final application of manufacturing technique of automobile products is capitalised only if all of the following conditions are satisfied: ? the development of manufacturing technique of automobile products has been fully demonstrated by technical team; ? management intends to complete the development of manufacturing technique of automobile products, and use or sell it; ? the research and analysis of preliminary market survey indicate that products manufactured with manufacturing technique of automobile products are marketable; ? adequate technical and financial supports are available for development of manufacturing techniques of automobile products and subsequent mass production; and ? expenditure on development of manufacturing techniques of automobile products can be reliably collected. | |
| Other expenditures on the development phase that do not meet the conditions above are recognised in profit or loss in the period in which they are incurred. Development expenditures previously recognised as expenses are not recognised as an asset in a subsequent period. Capitalised expenditure on the development phase is presented as development expenditures in the balance sheet and transferred to intangible assets at the date that the asset is ready for its intended use. |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 2 | Summary of significant accounting policies and accounting estimates (Cont’d) |
| (14) | Intangible assets (Cont’d) |
| (f) | Impairment of intangible assets |
| The carrying amounts of intangible assets are reduced to the recoverable amounts when the recoverable amounts are below their carrying amounts (Note 2(15)). | |
| (15) | Impairment of long-term assets |
| Fixed assets, construction in progress, right-of-use assets, intangible assets with finite useful lives and long-term equity investments in subsidiaries and associates are tested for impairment if there is any indication that the assets may be impaired at the balance sheet date; intangible assets that are not yet available for their intended use are tested for impairment at least once a year, irrespective of whether there is any indication of impairment. If the result of the impairment test indicates that the recoverable amount of an asset is less than its carrying amount, a provision for impairment and an asset impairment loss are recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less disposal costs and the present value of the future cash flows expected to be derived from the asset. Provision for asset impairment is determined and recognised on the individual asset basis. If it is not possible to estimate the recoverable amount of an individual asset, the recoverable amount of a group of assets to which the asset belongs is determined. A group of assets is the smallest group of assets that is able to generate independent cash inflows. | |
| Goodwill that is separately presented in the financial statements is tested at least once a year for impairment, irrespective of whether there is any indication that it may be impaired. In conducting the test, the carrying amount of goodwill is allocated to the related asset group or groups of asset groups which are expected to benefit from the synergies of the business combination. If the result of the test indicates that the recoverable amount of an asset group or a group of asset groups, including the allocated goodwill, is lower than its carrying amount, the corresponding impairment loss is recognised. The impairment loss is first deducted from the carrying amount of goodwill that is allocated to the asset group or group of asset groups, and then deducted from the carrying amounts of other assets within the asset group or group of asset groups in proportion to the carrying amounts of assets other than goodwill. | |
| Once the above asset impairment loss is recognised, it will not be reversed for the value recovered in the subsequent periods. | |
| (16) | Employee benefits |
| Employee benefits refer to all forms of consideration or compensation given by the Group in exchange for service rendered by employees or for termination of employment relationship, which include short-term employee benefits, post-employment benefits, termination benefits, etc. | |
| (a) | Short-term employee benefits |
| Short-term employee benefits include wages or salaries, bonus, allowances and subsidies, staff welfare, premiums or contributions on medical insurance, work injury insurance and maternity insurance, housing funds, union running costs and employee education costs, short-term paid absences, etc. The short-term employee benefits actually occurred are recognised as a liability in the accounting period in which the service is rendered by the employees, with a corresponding charge to the profit or loss for the current period or the cost of relevant assets. Non-monetary benefits are measured at fair value. |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022
(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 2 | Summary of significant accounting policies and accounting estimates (Cont’d) |
| (16) | Employee benefits (Cont'd) |
| (b) | Post-employment benefits |
| The Group classifies post-employment benefit plans as either defined contribution plans or defined benefit plans. Defined contribution plans are post-employment benefit plans under which the Group pays fixed contributions into a separate fund and will have no obligation to pay further contributions; and defined benefit plans are post-employment benefit plans other than defined contribution plans. During the reporting period, premiums or contributions on basic pensions and unemployment insurance paid for employees belong to defined contribution plans; supplementary retirement benefits for employees are defined benefit plans. | |
| (i) | Defined contribution plans |
| Basic pensions | |
| The Group’s employees participate in the basic pension plan set up and administered by local authorities of Ministry of Human Resources and Social Security. Monthly payments of premiums on the basic pensions are calculated according to the bases and percentage prescribed by the relevant local authorities. When employees retire, the relevant local authorities are obliged to pay the basic pensions to them. The amounts based on the above calculations are recognised as liabilities in the accounting period in which the service has been rendered by the employees, with a corresponding charge to the profit or loss for the current period or the cost of relevant assets. | |
| (ii) | Defined benefit plans |
| The Group also provides employees with supplementary retirement benefits in addition to the insurance system prescribed by the State. Such supplementary retirement benefits belong to defined benefit plans. The defined benefit liabilities recognised on the balance sheet represent the present value of defined benefit obligations less the fair value of the plan assets. The defined benefit obligations are calculated annually by an independent actuary using projected unit credit method at the interest rate of treasury bonds with similar obligation term and currency. Service costs related to supplementary retirement benefits (including current service costs, historical service costs and settled gains or losses) and net interest are recognised in profit or loss for the current period or the cost of related assets, and changes arising from remeasurement of net liabilities or net assets of defined benefit plans are recognised in other comprehensive income. | |
| (c) | Termination benefits |
| The Group provides compensation for terminating the employment relationship with employees before the end of the employment contracts or as an offer to encourage employees to accept voluntary redundancy before the end of the employment contracts. The Group recognises a liability arising from compensation for termination of the employment relationship with employees, with a corresponding charge to profit or loss for the current period at the earlier of the following dates: 1) when the Group cannot unilaterally withdraw an employment termination plan or a curtailment proposal; 2) when the Group recognises costs or expenses for a restructuring that involves the payment of termination benefits. |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 2 | Summary of significant accounting policies and accounting estimates (Cont’d) |
| (16) | Employee benefits (Cont'd) |
| (c) | Termination benefits (Cont’d) |
| Early retirement benefits | |
| The Group offers early retirement benefits to those employees who accept early retirement arrangements. The early retirement benefits refer to the salaries and social security contributions to be paid to and for the employees who accept voluntary retirement before the normal retirement date prescribed by the State, as approved by the management. The Group pays early retirement benefits to those early retired employees from the early retirement date until the normal retirement date. The Group accounts for the early retirement benefits in accordance with the treatment for termination benefits, in which the salaries and social security contributions to be paid to and for the early retired employees from the off-duty date to the normal retirement date are recognised as liabilities with a corresponding charge to the profit or loss for the current period. The differences arising from the changes in the respective actuarial assumptions of the early retirement benefits and the adjustments of benefit standards are recognised in profit or loss in the period in which they occur. | |
| The termination benefits expected to be settled within one year since the balance sheet date are classified as employee benefits payable. | |
| (17) | Dividend distribution |
| Cash dividends are recognised as liabilities in the period in which the dividends are approved at the shareholders’ meeting. | |
| (18) | Provisions |
| Provisions for product warranties, compensation to suppliers, etc. are recognised when the Group has a present obligation, it is probable that an outflow of economic benefits will be required to settle the obligation, and the amount of the obligation can be measured reliably. | |
| A provision is initially measured at the best estimate of the expenditure required to settle the related present obligation. Factors on a contingency, such as the risks, uncertainties and the time value of money, are taken into account as a whole in reaching the best estimate of a provision. Where the effect of the time value of money is material, the best estimate is determined by discounting the related future cash outflows. The increase in the discounted amount of the provision arising from passage of time is recognised as interest expense. | |
| The carrying amount of provisions is reviewed at each balance sheet date and adjusted to reflect the current best estimate. | |
| The provisions expected to be settled within one year since the balance sheet date are classified as current liabilities. |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 2 | Summary of significant accounting policies and accounting estimates (Cont’d) |
| (19) | Revenue |
| The Group sells automobiles and automobile parts to distributors or end customers. In addition, the Group also provides customers with auto maintenance and additional quality warranty services. The Group recognises revenue at the amount of the consideration that is entitled to be charged by the Group as expected when the customer obtains control over relevant goods or services. | |
| (a) | Sale of automobiles and automobile parts to distributors and end customers |
| The Group manufactures automobiles and automobile parts and sells such products to distributors and end customers. According to the contract, the delivery is completed after the products are delivered at the contracted delivery location and acceptance by both parties. The Group recognises the revenue at the timing of delivery completion. Where two or more obligations are included in a contract between the Group and the customers, at the beginning date of the contract, the Group allocates the transaction price to individual obligation in the relative proportion to the individual selling prices of products or services committed in each individual obligation. When the individual selling price is unobservable, the Group makes reasonable estimates on the individual selling price with comprehensive consideration to all available information, and by using market adjustment method, cost plus method, etc. The credit periods granted by the Group to distributors and end customers are generally within one year, which is consistent with the industry practice, and there is no significant financing component. The Group provides product warranties for automobiles and automobile parts as required by laws and regulations, and recognises the corresponding provisions (Note 2(18)). The Group provides distributors and end customers with sales discounts based on sales volume, and related revenue is recognised at contract consideration net of the discount amount estimated based on historical experience and using the expected value method. | |
| (b) | Rendering of services |
| The Group provides customers with automobile maintenance and additional quality warranty services, and the revenue is recognised based on the progress of service provision within a certain period. According to the nature of the service provided, the performance progress is determined in accordance with the value of the labour provided to the customer. | |
| When the Group recognises revenue based on the stage of completion, the amount with unconditional collection right obtained by the Group is recognised as accounts receivable, and the rest is recognised as contract assets. Meanwhile, loss provision for accounts receivable and contract assets are recognised on the basis of ECL (Note 2(8)). If the contract price received or receivable exceeds the amount for the completed service, the excess portion will be recognised as contract liabilities. Contract assets and contract liabilities under the same contract are presented on a net basis. |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 2 | Summary of significant accounting policies and accounting estimates (Cont’d) |
| (20) | Government grants |
| Government grants refer to the monetary or non-monetary assets obtained by the Group from the government at no consideration, including support funds for enterprise development, financial subsidies, etc. | |
| Government grants are recognised when the grants can be received and the Group can comply with all attached conditions. If a government grant is a monetary asset, it will be measured at the amount received or receivable. If a government grant is a non-monetary asset, it will be measured at its fair value. If it is unable to obtain its fair value reliably, it will be measured at its nominal amount. | |
| Government grants related to assets refer to government grants which are obtained by the Group for the purposes of purchase, construction or acquisition of the long-term assets. Government grants related to income refer to the government grants other than those related to assets. | |
| Government grants related to assets are recorded as deferred income and recognised in profit or loss on a reasonable and systemic basis over the useful lives of the assets. Government grants related to income that compensate future costs, expenses or losses are recorded as deferred income and recognised in profit or loss in reporting the related expenses; government grants related to income that compensate incurred costs, expenses or losses are recognised in profit or loss directly in the current period. | |
| The Group applies the presentation method consistently to the similar government grants in the financial statements. | |
| Government grants that are related to ordinary activities are included in operating profit, otherwise, they are recorded in non-operating income. | |
| The Group recorded at the actual amount of borrowings when received the loans at policy-based preferential interest rates received and the related borrowing costs are calculated on the basis of the principal amount borrowed and the preferential interest rate under the policy. |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022
(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 2 | Summary of significant accounting policies and accounting estimates (Cont’d) |
| (21) | Deferred tax assets and deferred tax liabilities |
| Deferred tax assets and deferred tax liabilities are calculated and recognised based on the differences arising between the tax bases of assets and liabilities and their carrying amounts (temporary differences). Deferred tax asset is recognised for the deductible losses that can be carried forward to subsequent years for deduction of the taxable profit in accordance with the tax laws. No deferred tax liability is recognised for a temporary difference arising from the initial recognition of goodwill. No deferred tax asset or deferred tax liability is recognised for the temporary differences resulting from the initial recognition of assets or liabilities due to a transaction other than a business combination, which affects neither accounting profit nor taxable profit (or deductible loss). At the balance sheet date, deferred tax assets and deferred tax liabilities are measured at the tax rates that are expected to apply to the period when the asset is realised or the liability is settled. | |
| Deferred tax assets are only recognised for deductible temporary differences, deductible losses and tax credits to the extent that it is probable that taxable profit will be available in the future against which the deductible temporary differences, deductible losses and tax credits can be utilised. | |
| Deferred tax liabilities are recognised for taxable temporary differences arising from investments in subsidiaries and associates, except where the Group is able to control the timing of reversal of such temporary differences, and it is probable that the temporary differences will not reverse in the foreseeable future. When it is probable that the deductible temporary differences arising from investments in subsidiaries and associates will be reversed in the foreseeable future and that the taxable profit will be available in the future against which the deductible temporary differences can be utilised, the corresponding deferred tax assets are recognised. | |
| Deferred tax assets and deferred tax liabilities are offset when: ? the deferred tax assets and deferred tax liabilities are related to the same taxpayer within the Group and the same taxation authority; and ? that taxpayer within the Group has a legally enforceable right to offset current tax assets against current tax liabilities. |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022
(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 2 | Summary of significant accounting policies and accounting estimates (Cont’d) |
| (22) | Leases |
| A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. | |
| The Group as the lessee | |
| At the commencement date, the Group shall recognise the right-of-use asset and measure the lease liabilities at the present value of the lease payments that are not paid at that date. Lease payments include fixed payments, the exercise price of a purchase option if the lessee is reasonably certain to exercise that option, and payments of penalties for terminating the lease if the lessee exercises an option to terminate the lease. Variable lease payments in proportion to sales are excluded from lease payments and recognised in profit or loss as incurred. Lease liabilities that are due within one year (inclusive) as from the balance sheet date are included in the current portion of non-current liabilities. | |
| The Group's right-of-use assets represent leased buildings. Right-of-use assets are measured initially at cost which comprises the amount of the initial measurement of lease liabilities, any lease payments made at or before the commencement date and any initially direct costs, less any lease incentives received. If it is reasonably probable that the Group will obtain ownership of the underlying asset by the end of the lease term, the asset is depreciated over its remaining useful life; otherwise the asset is depreciated over the shorter of the lease term and its remaining useful life. The carrying amounts of the right-of- use assets are reduced to the recoverable amounts when the recoverable amounts are below their carrying amounts (Note 2(15)). | |
| For short-term leases with a term of 12 months or less and leases of an individual asset (when new) of low value, the Group may, instead of recognising right-of-use assets and lease liabilities, recognise the lease payments in the cost of the underlying assets or in profit or loss for the current period on a straight-line basis over the lease term. | |
| The Group shall account for a lease modification as a separate lease if both: (1) the modification extends the scope of the lease by adding the right to use one or more underlying assets; (2) the increased consideration is equivalent to the amount of the individual price of the expanded part of the lease scope adjusted according to the contract conditions. | |
| For a lease modification that is not accounted for as a separate lease, the Group shall redetermine the lease term at the effective date of the lease modification, and remeasure the lease liability by discounting the revised lease payments using a revised discount rate, except for the simplified method for contract changes by the regulations of the Ministry of Finance. For a lease modification which narrows the scope of the lease or shortens the lease term, the Group decreases the carrying amount of the right-of-use asset, and recognises in profit or loss any gain or loss relating to the partial or full termination of the lease. For other changes which lead to the remeasurement of lease liabilities, the Group correspondingly adjusts the carrying amount of the right-of-use asset. | |
| For the eligible rental waivers on existing lease contracts, the Group applies the simplified method, records the undiscounted waivers in profit or loss and adjusts lease liability when the agreement is reached to dismiss the original payment obligation. |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 2 | Summary of significant accounting policies and accounting estimates (Cont’d) |
| (22) | Leases (Cont'd) |
| The Group as the lessor | |
| A lease is classified as a finance lease if it transfers substantially all the risks and rewards incidental to ownership of an underlying asset. An operating lease is a lease other than a finance lease. | |
| As the lessor, the Group does not hold any finance lease. Where the Group leases out self-owned buildings and vehicles under operating leases, rental income is recognised on a straight-line basis over the lease term. |
| (23) | Specific Reserve |
| According to the decision of the State Council on Further Strengthening the work of production safety(Guofa No.2 2004), the notice of Circular of the State Council on Further Strengthening the work of enterprise production safety (Guofa No.23 2010) and Measures for the Administration of the Extraction and Use of Enterprise Production Safety Expenses (Caizi (2022) No. 136) issued by the Ministry of Finance and the Ministry of Emergency Response in December 2022, the Group extracted safety production costs at a certain percentage of its operating revenue in the previous year, which is specifically used for safety costs. | |
| The Group's production safety expenses, which are extracted in accordance with the aforementioned national regulations, are included in the cost of relevant products or current profit or loss, and are also included in special reserves. | |
| When the safety fund is subsequently used for revenue expenditure, the specific reserve is reduced accordingly. On utilization of the safety fund for fixed assets, the specific reserve is reduced as the fixed assets are recognised, which is the time when the related assets are ready for their intended use; in such cases, an amount that corresponds to thereduction in the specific reserve is recognised in accumulated depreciation with respect to the related fixed assets. As a consequence, such fixed assets are not depreciated in subsequent periods. |
| (24) | Segment information |
| The Group identifies operating segments based on the internal organisation structure, management requirements and internal reporting system, and discloses segment information of reportable segments which is determined on the basis of operating segments. | |
| An operating segment is a component of the Group that satisfies all of the following conditions: (1) the component is able to earn revenues and incur expenses from its ordinary activities; (2) whose operating results are regularly reviewed by the Group’s management to make decisions about resources to be allocated to the segment and to assess its performance, and (3) for which the information on financial position, operating results and cash flows is available to the Group. Two or more operating segments that have similar economic characteristics and satisfy certain conditions can be aggregated into one single operating segment. |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022
(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 2 | Summary of significant accounting policies and accounting estimates (Cont’d) |
| (25) | Critical accounting estimates and judgements |
| The Group continually evaluates the critical accounting estimates and key judgements applied based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. | |
| (a) | Critical judgements in applying the accounting policies |
| (i) | Classification of financial assets |
| Significant judgements made by the Group in the classification of financial assets include business models and analysis on contractual cash flow characteristics. | |
| The Group determines the business model for financial assets management on the group basis, and factors to be considered include the methods for evaluating the financial assets performance and reporting such performance to key management personnel, the risks relating to the financial assets performance and corresponding management methods, the ways in which related business management personnel are remunerated, etc. | |
| When assessing whether contractual cash flow characteristics of financial assets are consistent with basic lending arrangement, key judgements made by the Group include: the possibility of changes in time schedule or amount of the principal during the lifetime due to reasons such as repayment in advance; whether interest only includes time value of money, credit risks, other basic lending risks and considerations for costs and profits. For example, whether the repayment in advance only reflects the principal outstanding and corresponding interest and reasonable compensation paid for early termination of the contract. | |
| (ii) | Judgement on significant increase in credit risk and occurrence of credit impairment |
| When the Group distinguishes the different stages of financial instruments, its judgement on significant increase in credit risk and occurrence of credit impairment is as follows: | |
| Judgement made by the Group for significant increase in credit risk is mainly based on whether the overdue days exceed 30 days, or whether one or more of the following indicators change significantly: business environment of the debtor, internal and external credit rating, significant changes in actual or expected operating results, significant decrease in value of collateral or credit rate of guarantor, etc. | |
| Judgement made by the Group for the occurrence of credit impairment is mainly based on whether the overdue days exceed 90 days (i.e., a default has occurred), or whether one or more of the following conditions is/are satisfied: the debtor is suffering significant financial difficulties, the debtor is undergoing other debt restructuring, or the debtor probably goes bankrupt, etc. | |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 2 | Summary of significant accounting policies and accounting estimates (Cont’d) |
| (25) | Critical accounting estimates and judgements (Cont’d) |
| (a) | Critical judgements in applying the accounting policies (Cont’d) |
| (iii) | Judgement on capitalisation of development expenditures |
| Development expenditures are capitalised when the criteria in Note 2(14)(e) are fulfilled. The assessments on whether the criteria for capitalisation of development expenditures have been met involve judgements of the Group, including the technical feasibility of the project, the likelihood of the project generating sufficient future economic benefits and the timing to start capitalisation particularly. The Group makes the judgements on the capitalisation of development expenditures and records the process in meeting minutes based on feasibility analysis, regular review on the development project phase, etc. | |
| (iv) | Timing of revenue recognition |
| The Group sells automobiles and automobile parts to distributors or end customers. According to the contract, the delivery is completed after the products are delivered at the contracted delivery location and acceptance by both parties. Thereafter, the distributors or end customers own the products, have the right to set prices independently, and bear the risks from price fluctuation or damage of the products. The distributors or end customers have obtained the control of the products after accepting the products. The Group recognizes the revenue at the timing of the delivery completion. | |
| (v) | Sales with product warranties |
| The Group provides statutory warranty for automobiles and automobile parts, and the periods and terms of such warranty comply with the requirements of laws and regulations related to the products. The Group does not provide any significant additional service or additional warranty for this purpose, thus this kind of warranty cannot be identified as a separate performance obligation. In addition, the Group also offers additional warranty other than the requirements of laws and regulations, which is identified as a separate performance obligation. The Group recognises the revenue of the additional warranty over time during the period when services are rendered. |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 2 | Summary of significant accounting policies and accounting estimates (Cont’d) | |||
| (25) | Critical accounting estimates and judgements (Cont’d) | |||
| (b) | Critical accounting estimates and key assumptions | |||
| The critical accounting estimates and key assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next fiscal year are outlined below: | ||||
| (i) | Measurement of ECL | |||
| The Group calculates ECL through default risk exposure and ECL rate and determines the ECL rate based on default probability and default loss rate. In determining the ECL rate, the Group uses data such as internal historical credit loss experience, etc., and adjusts historical data based on current conditions and forward-looking information. When considering forward-looking information, the Group takes different macroeconomic scenarios into consideration. In 2022, the weights of “base”, “bad” and “good” are 68%, 16% and 16% (2021: 68%, 16% and 16%) under three economic scenarios respectively for the consideration of forward-looking information. The Group regularly monitors, and reviews important macroeconomic assumptions and parameters related to the calculation of ECL rate, including the risks of economic downturn, external market environment, changes of technological environment and customer, gross domestic product, consumer price index and broad money supply. In 2022, the Group has considered the uncertainty under different macroeconomic scenarios, updated relevant assumptions and parameters accordingly. The key macroeconomic parameters used in each scenario are listed as follows: | ||||
| Scenarios | ||||
| Base | Bad | Good | ||
| Gross domestic product | 4.56% | 2.02% | 7.11% | |
| Consumer price index | 3.45% | -33.12% | 40.02% | |
| In 2021, the key macroeconomic parameters used in each scenario are listed below: | ||||
| Scenarios | ||||
| Base | Bad | Good | ||
| Gross domestic product | 7.81% | 4.74% | 10.89% | |
| Consumer price index | 1.82% | -1.38% | 5.02% | |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022
(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 2 | Summary of significant accounting policies and accounting estimates (Cont’d) |
| (25) | Critical accounting estimates and judgements (Cont’d) |
| (b) | Critical accounting estimates and key assumptions (Cont’d) |
| (ii) | Provision for long-term asset impairment |
| The Group assesses whether there is any indication that non-current assets other than financial assets may be impaired at the balance sheet date. When there are indications showing the carrying amounts of such assets cannot be recovered, an impairment test will be performed. | |
| When the carrying amount of non-current assets or asset groups other than financial assets is higher than the recoverable amount, which is the higher of an asset’s fair value less disposal costs and the present value of the future cash flows expected to be derived from the asset, it shows non-current assets or asset groups are impaired. | |
| The amount of an asset’s fair value less disposal costs was determined by the price of a sale agreement in an arm’s length transaction, less the costs that are directly attributable to the disposal of the asset. Where there is no sales agreement but there is an active market of assets, the amount is determined by the market price less the costs that are directly attributable to the disposal of the asset. The market price of assets is determined by the considerations provided by the buyer. Where there is no sales agreement or active market of assets, the amount of an asset’s fair value less disposal costs was determined based on the best information available, with reference to the latest transaction price or results of similar assets of the same industry. | |
| Disposal costs include legal cost, taxes and handling fee related to asset disposal, and direct costs incurred to bring the assets to a saleable state. | |
| (iii) | Income tax and deferred income tax |
| The Group is subject to enterprise income tax in multiple regions. There are some transactions and events for which the ultimate tax treatment is uncertain during the ordinary course of business. Significant judgement is required from the Group in determining the provision for income taxes in each of these regions. Where the final tax outcome of these matters is different from the amounts that were initially recorded, such differences will impact the income tax and deferred tax provisions in the period in which such determination is made. |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 2 | Summary of significant accounting policies and accounting estimates (Cont’d) |
| (25) | Critical accounting estimates and judgements (Cont’d) |
| (b) | Critical accounting estimates and key assumptions (Cont’d) |
| (iii) | Income tax and deferred income tax (Cont’d) |
| As stated in Note 3(2), the Company is a high-tech enterprise. The “High-Tech Enterprise Certificate” is effective for three years. Upon expiration, application for high-tech enterprise assessment should be submitted again to the relevant government authorities. Based on the past experience of reassessment for high-tech enterprise upon expiration and its actual conditions, the Company considers that it is able to obtain the qualification for high- tech enterprises in the next 3 years, and therefore a preferential tax rate of 15% is used to calculate the corresponding deferred income tax. If the Company cannot obtain the qualification for high-tech enterprise upon expiration, then the Company is subject to a statutory tax rate of 25% for the calculation of income tax, which further influences the recognised deferred tax assets, deferred tax liabilities and income tax expenses. | |
| Deferred tax assets are recognised for the deductible tax losses that can be carried forward to subsequent years to the extent that it is probable that taxable profit will be available in the future against which the deductible tax losses can be utilised. Taxable profit that will be available in the future includes the taxable profit that will be realised through ordinary course of business and the taxable profit that will be increased upon the future reversal of taxable temporary differences incurred in prior periods. Judgements and estimates are required to determine the time and amounts of taxable profit in the future. Any difference between the reality and the estimate may result in adjustment to the carrying amount of deferred tax assets. | |
| (iv) | Provisions |
| The Group undertakes after-sales repair or replacement obligations for automobiles sold based on the after-sales service agreement. Management estimates related provisions based on historical after-sales service data, including the repair and replacement provided as well as current trends. Factors that may impact the estimation of warranty costs include improvement of the Group’s productivity and production quality, as well as changes in related parts and labour costs. Any increase or decrease in provisions will have impact on profit or loss of the Group in the future. | |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 2 | Summary of significant accounting policies and accounting estimates (Cont’d) |
| (25) | Critical accounting estimates and judgements (Cont’d) |
| (b) | Critical accounting estimates and key assumptions (Cont’d) |
| (v) | Provision for decline in the value of inventories |
| The Group's inventories are stated at the lower of cost and net realisable value. Net realisable value of inventories is the amount of the estimated selling price in the ordinary course of business, less the estimated costs to completion, estimated contract performance costs, estimated costs necessary to make the sales and related taxes. | |
| If the management revises the estimated selling price of the inventory, the estimated costs to be incurred by the time of completion, and the estimated selling and distribution expenses and related taxes, the revised estimated selling price is lower than the currently adopted estimated selling price, or the revised until The estimated costs, estimated contract performance costs, sales expenses, and related taxes and fees at the completion of the project are higher than the currently adopted estimates, the Group needs to make provision for decline in the value of inventory. | |
| If the actual selling prices, costs to completion, estimated contract performance costs, selling and distribution expenses and related taxes are higher or lower than management’s estimates, the Group shall recognise the relevant differences in the consolidated income statement during the corresponding accounting period. |
| (26) | Significant changes in accounting policies |
| The Ministry of Finance released the Circular on Issuing Interpretation No. 15 of Accounting Standards for Business Enterprises (hereinafter “Interpretation No. 15”) in 2021, and released the Circular on Issuing Interpretation No. 16 of Accounting Standards for Business Enterprises (hereinafter “Interpretation No. 16”) and Q&A on Implementation of Accounting Standards for Business Enterprises ,etc. in 2022 and 2023. The financial statements for the year ended 31 December 2022 have been prepared in accordance with the above circulars and Q&A, and the impacts on the financial statements of the Group and the Company are insignificant except the followings. | |
| (a) | Accounting treatment for trial run of fixed assets |
| The Group and the Company implemented the regulation of related to trial run sales of fixed assets in Interpretation No. 15 from 1 January 2022. This changes in accounting policies had no impacts on the balance sheet as at 1 January 2022. |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 3 | Taxation | ||
| (1) | The main categories and rates of taxes applicable to the Group are set out below: | ||
| Category | Taxation basis | Tax rate | |
| Enterprise income tax (a) | Taxable income | 15% and 25% | |
| Value-added tax (“VAT”) (b) | Taxable value-added amount (Tax payable is calculated using the taxable sales amount multiplied by the applicable tax rate less deductible input VAT of the current period) | 13%, 9% and 6% | |
| Consumption tax (c) | Taxable sales amount | 3%, 5% and 9% | |
| City maintenance and construction tax (d) | The payment amount of VAT and consumption tax | 5% and 7% | |
| (a) | Pursuant to the Circular on Enterprise Income Tax Policy Concerning Deductions for Equipment and Appliances (Cai Shui [2018] No. 54) and the Announcement on Extending the Implementation Period of Certain Preferential Tax Policies (Cai Shui [2021] No. 6) issued by the State Taxation Administration and relevant regulations, during the period from 1 January 2018 to 31 December 2023, the cost of newly purchased equipment with the original cost less than RMB5 million can be fully deducted against taxable profit in the next month after the asset is put into use, instead of being depreciated annually for tax filing. | ||
| (b) | Pursuant to the Announcement on Relevant Policies for Deepening Value-Added Tax Reform (Announcement [2019] No. 39) and relevant regulations jointly issued by the Ministry of Finance, the State Taxation Administration and the General Administration of Customs, the Group’s taxable products sales revenue is subject to the VAT at the rate of 13%. The Group's real estate leasing business is subject to the VAT at the rate of 9%. Revenue from provision of technical service to external parties is subject to VAT at the rate of 6%. | ||
| (c) | Pursuant to the Interim Regulations of the People's Republic of China on Consumption Tax promulgated by the State Council (Order No. 539 of the State Council of the People's Republic of China) and the Notice of Ministry of Finance and State Taxation Administration on Adjusting Consumption Tax Policies for Passenger Cars (Cai Shui [2008] No. 105), the consumption tax rates of the Group's taxable products are 3%, 5% and 9%. | ||
| (d) | Pursuant to the Circular of the State Council on Unifying the Collection of City Maintenance and Construction Tax and Educational Surcharge on Domestic and Foreign-Owned Enterprises and Individuals (Guo Fa [2010] No. 35) issued by the State Council, the Group is subject to city maintenance and construction tax at the rates of 5% and 7%. | ||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 3 | Taxation (Cont’d) |
| (2) | Tax preference |
| Pursuant to the Circular on the Announcement of the First Batch of High-Tech Enterprises of Jiangxi Province for the year 2021 (Gan Gao Qi Ren Ban [2021] No. 8), the Company is certified as a high-tech enterprise, and the valid term is three years. Under Article 28 of the Enterprise Income Tax Law of the People's Republic of China, the income tax rate applicable to the Company for the year of 2022 is 15% (2021: 15%). In addition, pursuant to the Announcement on Increasing Pre-tax Deductions in Support of Scientific and Technological Innovation (Announcement of the Ministry of Finance, the State Taxation Administration, and the Ministry of Science and Technology [2022] No. 28) issued by the Ministry of Finance, the State Taxation Administration, and the Ministry of Science and Technology, during the period from 1 October 2022 to 31 December 2022, the newly purchased equipment of subsidiary the company could be fully deducted against taxable profit in 2022, and 100% additional deduction was applicable before tax. | |
| In 2022, except for the Company, the Company’s wholly-owned companies, including JMC Heavy Duty Vehicle Co., Ltd. (“JMCH”), Jiangling Motor Sales Co., Ltd. (“JMCS”), Shenzhen Fujiang New Energy Automobile Sales Co., Ltd. (“SZFJ”), Guangzhou Fujiang New Energy Automobile Sales Co., Ltd. (“GZFJ”), and Jiangling Ford Automobile Technology (Shanghai) Co., Ltd. (“Jiangling Ford (Shanghai)”) were subject to the enterprise income tax at the rate of 25% (2021: 25%). |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements | ||||
| (1) | Cash at bank and on hand | ||||
| 31 December 2022 | 31 December 2021 | ||||
| Cash at bank | 7,656,947,735 | 8,509,470,334 | |||
| Deposits from a finance company (a) (Note 7(6)) | 886,245,919 | 1,059,580,980 | |||
| Interest receivable | 61,784,071 | - | |||
| 8,604,977,725 | 9,569,051,314 | ||||
| (a) | As at 31 December 2022, the Group's bank deposits placed with Jiangling Motor Group Finance Company Limited(“JMCF”) bear interest at the bank's annual interest rate of 1.725% - 2.25% (2021: 1.725% - 2.25%) on RMBdeposits for the same period. JMCF, a holding subsidiary of Jiangling Motors Group Co., Ltd (“JMCG”), is a non-banking financial institution. JMCG holds 50% equity capital of Nanchang Jiangling Investment Co., Ltd. (“JIC”), a main shareholder of the Company. | ||||
| (2) | Financial assets held for trading | ||||
| 31 December 2022 | 31 December 2021 | ||||
| Structural deposits | - | 100,242,329 | |||
| (3) | Derivative financial assets and derivative financial liabilities | |||
| 31 December 2022 | 31 December 2021 | |||
| Derivative financial assets - | ||||
| Forward exchange contracts | 2,972,698 | - | ||
| Derivative financial liabilities - | ||||
| Forward exchange contracts | - | 10,704,619 | ||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) |
| (4) | Notes receivable | |||
| 31 December 2022 | 31 December 2021 | |||
| Trade acceptance notes | 743,071,151 | 119,783,900 | ||
| Less: Provision for bad debts | (318,421) | - | ||
| 742,752,730 | 119,783,900 | |||
| As at 31 December 2022, the Group had notes receivable from Jiangxi Jiangling Import & Export Co., Ltd. amounting to RMB600,000,000 (31 December 2021: Nil) (Note 7(6)). | |
| (a) | As at 31 December 2022, there were no notes receivable pledged. |
| (b) | As at 31 December 2022, the Group's notes receivable presented as endorsed or discounted but not yet due are as follows. | |||
| Non-terminated Confirmation | ||||
| Commercial acceptances | 600,000,000 | |||
| (c) | Provision for bad debts | |||
| For notes receivable arising from sales of goods and rendering of services in the ordinary course of operating activities, the Group measures the loss provision based on the lifetime ECL regardless of whether there is a significant financing component. As at 31 December 2022, The Group measures the provision for bad debts on the basis of expected credit losses throughout its life and the related amount is RMB318,421 (31 December 2021: nil). There is no provision for bad debts recovered or reversed during the year. | ||||
| (5) | Accounts receivable | |||
| 31 December 2022 | 31 December 2021 | |||
| Accounts receivable | 4,367,065,120 | 3,213,330,895 | ||
| Less: Provision for bad debts | (121,523,368) | (218,532,668) | ||
| 4,245,541,752 | 2,994,798,227 | |||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) | |||
| (5) | Accounts receivable (Cont’d) | |||
| (a) | The ageing of accounts receivable is analysed as follows: | |||
| 31 December 2022 | 31 December 2021 | |||
| Within 1 year | 4,183,936,645 | 2,713,109,300 | ||
| 1 to 2 years | 12,186,785 | 128,900,600 | ||
| Over 2 years | 170,941,690 | 371,320,995 | ||
| 4,367,065,120 | 3,213,330,895 | |||
| (b) | As at 31 December 2022, the top five accounts receivable ranked by remaining balances are analysed as follows: | |||||
| Balance | Amount of provision for bad debts | % of total balance | ||||
| Company 1 | 1,809,124,109 | (1,495,512) | 41.43% | |||
| Company 2 | 178,320,397 | (76,414) | 4.08% | |||
| Company 3 | 105,372,893 | (963,329) | 2.41% | |||
| Company 4 | 86,707,209 | (42,388) | 1.99% | |||
| Company 5 | 72,230,000 | (72,230,000) | 1.65% | |||
| 2,251,754,608 | (74,807,643) | 51.56% | ||||
| (c) | Provision for bad debts | |||||
| For accounts receivable, the Group measures the loss provision based on the lifetime ECL regardless of whether there is a significant financing component. | ||||||
| (i) | Accounts receivable for which provision for bad debts is made on the individual basis are analysed as follows: | |||||
| 31 December 2022 | |||||||
| Book balance | Provision for bad debts | ||||||
| Amount | Lifetime ECL (%) | Amount | |||||
| New energy subsidies receivable | 37,924,214 | 100% | (37,924,214) | ||||
| Receivables for automobiles | 72,230,000 | 100% | (72,230,000) | ||||
| 110,154,214 | (110,154,214) | ||||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022
(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) |
| (5) | Accounts receivable (Cont’d) |
| (c) | Provision for bad debts (Cont’d) |
| (i) | Accounts receivable for which provision for bad debts is made on the individual basis are analysed as follows (Cont’d): |
| 31 December 2021 | |||||||
| Book balance | Provision for bad debts | ||||||
| Amount | Lifetime ECL (%) | Amount | |||||
| New energy subsidies receivable | 103,180,418 | 100% | (103,180,418) | ||||
| Receivables for automobiles | 80,862,880 | 100% | (80,862,880) | ||||
| 184,043,298 | (184,043,298) | ||||||
| As at 31 December 2022, The Group assessed the expected credit losses on the related accounts receivables, the Group considered the receivables cannot be collected, therefore, full provision was made for those receivables. |
| (ii) | Accounts receivable for which provision for bad debts is made on the grouping basis are analysed as follows: |
| Grouping - Sales of general automobiles: |
| 31 December 2022 | |||||||
| Book balance | Provision for bad debts | ||||||
| Amount | Lifetime ECL (%) | Amount | |||||
| Not overdue | 3,342,241,063 | 0.04% | (1,433,732) | ||||
| Overdue for 1 to 30 days | 191,926,407 | 0.04% | (82,244) | ||||
| Overdue for 31 to 60 day | 60,431,806 | 1.07% | (645,450) | ||||
| Overdue for 61 to 90 days | 28,747,850 | 2.07% | (596,073) | ||||
| Overdue over 90 days | 132,725,554 | 3.14% | (4,170,090) | ||||
| 3,756,072,680 | (6,927,589) | ||||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) |
| (5) | Accounts receivable (Cont’d) |
| (c) | Provision for bad debts (Cont’d) |
| (ii) | Accounts receivable for which provision for bad debts is made on the grouping basis are analysed as follows (Cont’d): |
| Grouping - Sales of general automobiles (Cont’d): |
| 31 December 2021 | |||||||
| Book balance | Provision for bad debts | ||||||
| Amount | Lifetime ECL (%) | Amount | |||||
| Not overdue | 2,279,044,623 | 0.08% | (1,829,856) | ||||
| Overdue for 1 to 30 days | 182,608,365 | 0.08% | (146,245) | ||||
| Overdue for 31 to 60 days | 48,703,203 | 2.44% | (1,186,068) | ||||
| Overdue for 61 to 90 days | 25,563,462 | 4.15% | (1,061,263) | ||||
| Overdue over 90 days | 37,478,374 | 5.01% | (1,876,531) | ||||
| 2,573,398,027 | (6,099,963) | ||||||
| Grouping - Sales of new energy automobiles: |
| 31 December 2022 | |||||||
| Book balance | Provision for bad debts | ||||||
| Amount | Lifetime ECL (%) | Amount | |||||
| Overdue over 90 days | 8,803,260 | 31.06% | (2,734,591) | ||||
| 31 December 2021 | |||||||
| Book balance | Provision for bad debts | ||||||
| Amount | Lifetime ECL (%) | Amount | |||||
| Overdue over 90 days | 187,009,300 | 14.67% | (27,438,915) | ||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) |
| (5) | Accounts receivable (Cont’d) |
| (c) | Provision for bad debts (Cont'd) |
| (ii) | Accounts receivable for which provision for bad debts is made on the grouping basis are analysed as follows (Cont’d): |
| Grouping – Automobile parts: | |||||||
| 31 December 2022 | |||||||
| Book balance | Provision for bad debts | ||||||
| Amount | Lifetime ECL (%) | Amount | |||||
| Not overdue | 467,350,948 | 0.30% | (1,402,053) | ||||
| Overdue for 1 to 30 days | 16,889,558 | 0.30% | (50,669) | ||||
| Overdue for 31 to 60 days | 1,741,552 | 0.50% | (8,708) | ||||
| Overdue for 61 to 90 days | 1,297,746 | 0.60% | (7,786) | ||||
| Overdue over 90 days | 4,755,162 | 5.00% | (237,758) | ||||
| 492,034,966 | (1,706,974) | ||||||
| 31 December 2021 | |||||||
| Book balance | Provision for bad debts | ||||||
| Amount | Lifetime ECL (%) | Amount | |||||
| Not overdue | 236,210,964 | 0.30% | (708,633) | ||||
| Overdue for 1 to 30 days | 10,782,728 | 0.30% | (32,348) | ||||
| Overdue for 31 to 60 days | 14,692,940 | 0.50% | (73,465) | ||||
| Overdue for 61 to 90 days | 3,469,461 | 0.60% | (20,817) | ||||
| Overdue over 90 days | 3,724,177 | 3.09% | (115,229) | ||||
| 268,880,270 | (950,492) | ||||||
| (iii) | The amount of provision for bad debts for the year was RMB35,727,702 and the amount of provision for bad debts reversed was RMB23,230,284. The reason is that the amounts for which bad debts had been accrued were recovered in the current period. Among them, the receivables that had been individually accrued in the previous period were recovered in the current period in the amount of RMB110,068 and the corresponding carrying amount was RMB110,068. |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) | |||||
| (5) | Accounts receivable (Cont’d) | |||||
| (d) | As the relevant amounts were confirmed to be uncollectible, the actual carrying amount of accounts receivable written off during the year was RMB109,506,718 and the amount of provision for bad debts was RMB109,506,718, of which RMB8,522,812 was written off in respect of accounts receivable for complete vehicles and RMB100,983,906 was written off in respect of accounts receivable for new energy subsidies. The above write-offs are not related transactions and have been approved by the board of directors. | |||||
| (e) | As at 31 December 2022 and 31 December 2021, there were no accounts receivable pledged. | |||||
| (6) | Financing receivables | |||||
| 31 December 2022 | 31 December 2021 | |||||
| Bank acceptance notes | 376,662,817 | 201,511,670 | ||||
| The Group endorses the bank acceptance notes as required by daily fund management, which also met the criteria for derecognition, and therefore classified those the bank acceptance notes as financial assets at fair value through other comprehensive income. | ||||||
| The Group had no bank acceptance notes for which the provision for impairment was made on the individual basis. As at 31 December 2022, the Group measures the loss provision of financing receivables based on the lifetime ECL. As at 31 December 2022, the acceptors of the Groups’ notes receivable were mainly major state-owned banks or large and medium-sized banks with good reputation and credit ranking. Therefore, the Group expected there was no significant loss on related bank acceptance notes arising from bank default. | ||||||
| As at 31 December 2022, the Group had no pledged bank acceptance notes receivable presented in financing receivables. | ||||||
| As at 31 December 2022, the Group's bank acceptance notes had been endorsed or discounted but not yet matured were RMB1,610,132,623 and were derecognised. | ||||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022
(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) | |||||||
| (7) | Advances to suppliers | |||||||
| (a) | The ageing of advances to suppliers is analysed as below: | |||||||
| 31 December 2022 | 31 December 2021 | |||||||
| Amount | % of total balance | Amount | % of total balance | |||||
| Within 1 year | 277,743,526 | 100% | 497,302,198 | 100% | ||||
| (b) | As at 31 December 2022, the top five advances to suppliers ranked by remaining balances are analysed as follows: | ||||
| Amount | % of total balance | ||||
| Company 1 | 233,947,199 | 84.23% | |||
| Company 2 | 19,417,115 | 6.99% | |||
| Company 3 | 14,713,085 | 5.30% | |||
| Company 4 | 4,680,155 | 1.69% | |||
| Company 5 | 4,399,737 | 1.58% | |||
| 277,157,291 | 99.79% | ||||
| (8) | Other receivables | ||||
| 31 December 2022 | 31 December 2021 | ||||
| Receivable for subsidiary disposal | 60,900,000 | 252,000,000 | |||
| Import working capital | 10,000,000 | 25,000,000 | |||
| Disposal of assets | 4,604,745 | 17,668,457 | |||
| Others | 35,893,235 | 106,351,839 | |||
| 111,397,980 | 401,020,296 | ||||
| Less: Provision for bad debts | (334,608) | (1,036,560) | |||
| 111,063,372 | 399,983,736 | ||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022
(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) |
| (8) | Other receivables (Cont’d) |
| (a) | The ageing of other receivables is analysed as follows: | |||
| 31 December 2022 | 31 December 2021 | |||
| Within 1 year | 47,163,619 | 398,699,129 | ||
| Over 1 year | 64,234,361 | 2,321,167 | ||
| 111,397,980 | 401,020,296 | |||
| (b) | Provision for losses and changes in book balance statements: |
| Stage 1 | ||||||
| 12-month ECL (grouping) | Total | |||||
| Book balance | Provision for bad debts | Provision for bad debts | ||||
| 31 December 2021 | 401,020,296 | (1,036,560) | (1,036,560) | |||
| Net decrease in the current year | (289,622,316) | — | — | |||
| Bad debt provision reversed in the current year | — | 701,952 | 701,952 | |||
| 31 December 2022 | 111,397,980 | (334,608) | (334,608) | |||
| As at 31 December 2022 and 31 December 2021, the Group had no other receivables at Stage 2 and Stage 3. The analysis of other receivables at Stage 1 is stated below: |
| (i) | As at 31 December 2022 and 31 December 2021, the Group had no other receivables with provision for bad debts on the individual basis. |
| (ii) | As at 31 December 2022, the Group’s other receivables with provision for bad debts on the grouping basis were analysed below: |
| Book balance | Expected credit loss ratio within the next 12 months | Provision for bad debts | Rationale | |||||
| Portfolio accrual： | ||||||||
| Receivable for subsidiary disposal | 60,900,000 | 0.30% | (182,700) | Expected credit losses | ||||
| Import working capital | 10,000,000 | 0.30% | (30,000) | Expected credit losses | ||||
| Disposal of assets | 4,604,745 | 0.30% | (13,814) | Expected credit losses | ||||
| Others | 35,893,235 | 0.30% | (108,094) | Expected credit losses | ||||
| 111,397,980 | (334,608) |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022
(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) |
| (8) | Other receivables (Cont’d) |
| (ii) | As at 31 December 2021, the Group’s other receivables with provision for bad debts on the grouping basis were analysed below: |
| Book balance | Expected credit loss ratio within the next 12 months | Provision for bad debts | Rationale | |||||
| Portfolio accrual： | ||||||||
| Receivable for subsidiary disposal | 252,000,000 | 0.30% | (756,000) | Expected credit losses | ||||
| Import working capital | 25,000,000 | 0.30% | (75,000) | Expected credit losses | ||||
| Disposal of assets | 17,668,457 | 0.30% | (53,005) | Expected credit losses | ||||
| Others | 51,099,064 | 0.30% | (152,555) | Expected credit losses | ||||
| Interest receivable | 55,252,775 | - | - | Expected credit losses | ||||
| 401,020,296 | (1,036,560) |
| (c) | RMB701,952 of provision for bad debts was reversed in the current year. |
| (d) | As at 31 December 2022, the top five other receivables by the balance of the debtors are listed as follows: | |||||||||
| Nature | Balance | Ageing | % of total balance | Provision for bad debts | ||||||
| Company 1 | Receivable for subsidiary disposal | 60,900,000 | More than one year | 54.67% | (182,700) | |||||
| Company 2 | Prepayment | 12,919,400 | Within one year | 11.60% | (38,758) | |||||
| Company 3 | Import working capital, etc. | 10,231,067 | Within one year | 9.18% | (30,693) | |||||
| Company 4 | Asset disposal payments, etc. | 4,614,745 | Within one year | 4.14% | (13,844) | |||||
| Company 5 | Platform usage fees receivable | 4,510,173 | Within one year | 4.05% | (13,531) | |||||
| 93,175,385 | 83.64% | (279,526) | ||||||||
| (9) | Inventories | |||
| (a) | Inventories are summarised by categories as follows: | |||
| 31 December 2022 | 31 December 2021 | |||
| Book balance | Provision for decline in the value of inventories | Carrying amount | Book balance | Provision for decline in the value of inventories | Carrying amount | |||||||
| Raw materials | 1,077,387,177 | (70,415,497) | 1,006,971,680 | 875,837,414 | (70,998,768) | 804,838,646 | ||||||
| Finished goods | 695,697,324 | - | 695,697,324 | 740,881,390 | - | 740,881,390 | ||||||
| Work in progress | 254,199,491 | (857,711) | 253,341,780 | 205,597,637 | (1,297,098) | 204,300,539 | ||||||
| Low value consumables | 93,411,573 | (537,572) | 92,874,001 | 93,028,528 | (4,443,955) | 88,584,573 | ||||||
| Materials in transit | 42,989,505 | - | 42,989,505 | 94,075,651 | - | 94,075,651 | ||||||
| Materials consigned for processing | 37,166,530 | - | 37,166,530 | 42,047,833 | - | 42,047,833 | ||||||
| 2,200,851,600 | (71,810,780) | 2,129,040,820 | 2,051,468,453 | (76,739,821) | 1,974,728,632 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) |
| (9) | Inventories (Cont’d) |
| (b) | Provision for decline in the value of inventories is analysed as follows: |
| 31 December 2021 | Increase in the current year | Decrease in the current year | 31 December 2022 | |||||||
| Provision | Reversal | Write-off | ||||||||
| Raw materials | (70,998,768) | (8,795,008) | 2,712,875 | 6,665,404 | (70,415,497) | |||||
| Low value consumables | (4,443,955) | (537,572) | 185,448 | 4,258,507 | (537,572) | |||||
| Work in progress | (1,297,098) | (49,637) | 4,288 | 484,736 | (857,711) | |||||
| (76,739,821) | (9,382,217) | 2,902,611 | 11,408,647 | (71,810,780) | ||||||
| (c) | Provision for decline in the value of inventories is analysed as follows: | ||||
| Specific basis for determining net realisable value | Reason for current year reversal or write-off of provision for decline in the value of inventories | ||||
| Raw materials/Work in progress/Low value consumables | Based on the estimated selling price, less the estimated costs to completion, estimated contract performance costs and selling and distribution expenses and related taxes | Increase in the net realisable value of the provision for decline in the value of inventories had been made in prior years or sales realised | |||
| (10) | Other current assets | |||
| 31 December 2022 | 31 December 2021 | |||
| Taxes prepaid, input VAT to be deducted and to be verified | 1,362,502,624 | 984,174,056 | ||
| (11) | Current portion of non-current assets | |||
| 31 December 2022 | 31 December 2021 | |||
| Current portion of long-term receivables (Note 4(12)) | 13,851,634 | 13,236,153 | ||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) | |||
| (12) | Long-term receivables | |||
| 31 December 2022 | 31 December 2021 | |||
| Long-term receivables | 48,695,467 | 64,375,548 | ||
| Less: Unearned financing income | (3,549,703) | (5,993,630) | ||
| Provision for bad debts | (146,086) | (193,127) | ||
| Current portion of long-term receivables(Note 4(11)) | (13,851,634) | (13,236,153) | ||
| 31,148,044 | 44,952,638 | |||
| As at 31 December 2022, the Group's long-term receivables were generated by instalment collections from disposal of fixed assets, which will be recovered from 2023 to 2026. | |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) | |||||||||||||||||||
| (13) | Long-term equity investments | |||||||||||||||||||
| 31 December 2022 | 31 December 2021 | |||||||||||||||||||
| Associates | ||||||||||||||||||||
| - Shanxi Yunnei Power Co., Ltd. (“The Power Company”) | 211,055,689 | 220,842,615 | ||||||||||||||||||
| - Hanon Systems (Nanchang) Co., Ltd. (“Hanon Systems”) | 37,427,133 | 36,408,640 | ||||||||||||||||||
| Less: Provision for impairment of long-term equity investments | - | - | ||||||||||||||||||
| 248,482,822 | 257,251,255 | |||||||||||||||||||
| Associates | ||||||||||||||||||||
| Movements for the current year | ||||||||||||||||||||
| 31 December 2021 | Increase/ decreace in the current period | Share of net profit/(loss) under equity method | Cash dividends declared | Provision for impairment | 31 December 2022 | Shareholding (%) | Voting rights (%) | Ending balance of provision for impairment | ||||||||||||
| The Power Company | 220,842,615 | - | (9,786,926) | - | - | 211,055,689 | 40% | 40% | - | |||||||||||
| Hanon Systems | 36,408,640 | - | 1,018,493 | - | - | 37,427,133 | 19.15% | 33.33% | - | |||||||||||
| Total | 257,251,255 | - | (8,768,433) | - | - | 248,482,822 | - | |||||||||||||
Related information of equity in associates is set forth in Note 5(2).
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) | |||
| (14) | Fixed assets | |||
| 31 December 2022 | 31 December 2021 | |||
| Fixed assets (a) | 5,446,006,505 | 6,027,890,644 | ||
| Fixed assets pending for disposal (b) | 377,864 | 1,411,387 | ||
| 5,446,384,369 | 6,029,302,031 | |||
| (a) | Fixed assets | |||
| . | Buildings | Machinery and equipment | Vehicles | Moulds | Electronic and other equipment | Total | |
| Cost | |||||||
| 31 December 2021 | 2,745,069,082 | 3,491,849,012 | 376,797,673 | 3,235,951,735 | 3,882,390,000 | 13,732,057,502 | |
| Increase in the current year | |||||||
| Transfer from construction in progress | 13,835,772 | 84,766,479 | 24,324,999 | 349,825,432 | 183,134,214 | 655,886,896 | |
| Other increases | - | - | 2,300,000 | - | - | 2,300,000 | |
| Decrease in the current year | |||||||
| Disposal or retirement | (545,490,834) | (17,631,753) | (12,393,866) | (131,091,542) | (39,178,267) | (745,786,262) | |
| Others | - | (124,564,793) | - | - | (54,873,232) | (179,438,025) | |
| Reclassification | - | (281,109,796) | 84,516,373 | - | 196,593,423 | - | |
| 31 December 2022 | 2,213,414,020 | 3,153,309,149 | 475,545,179 | 3,454,685,625 | 4,168,066,138 | 13,465,020,111 | |
| Accumulated depreciation | |||||||
| 31 December 2021 | (623,685,758) | (1,675,100,705) | (231,571,055) | (2,486,558,453) | (2,318,281,178) | (7,335,197,149) | |
| Increase in the current year | |||||||
| Provision | (57,544,946) | (222,729,119) | (56,281,925) | (172,955,867) | (396,664,981) | (906,176,838) | |
| Decrease in the current year | |||||||
| Disposal or retirement | 261,824,676 | 12,399,317 | 9,525,492 | 112,936,470 | 36,329,271 | 433,015,226 | |
| Others | - | 96,947,819 | - | - | 46,229,130 | 143,176,949 | |
| 31 December 2022 | (419,406,028) | (1,788,482,688) | (278,327,488) | (2,546,577,850) | (2,632,387,758) | (7,665,181,812) | |
| Provision for impairment | |||||||
| 31 December 2021 | - | (12,564,527) | (2,833,467) | (336,857,072) | (16,714,643) | (368,969,709) | |
| Increase in the current year | |||||||
| Provision | - | (565,007) | - | (31,034) | (167,121) | (763,162) | |
| Decrease in the current year | |||||||
| Disposal or retirement | - | 737,384 | 262,387 | 13,440,664 | 1,460,642 | 15,901,077 | |
| 31 December 2022 | - | (12,392,150) | (2,571,080) | (323,447,442) | (15,421,122) | (353,831,794) | |
| Carrying amount | |||||||
| 31 December 2022 | 1,794,007,992 | 1,352,434,311 | 194,646,611 | 584,660,333 | 1,520,257,258 | 5,446,006,505 | |
| 31 December 2021 | 2,121,383,324 | 1,804,183,780 | 142,393,151 | 412,536,210 | 1,547,394,179 | 6,027,890,644 |
| In 2022, depreciation charged to fixed assets amounted to RMB906,176,838 (2021: RMB887,989,750), of which the depreciation expenses charged in the cost of sales, selling and distribution expenses, general and administrative expenses and research and development expenses were RMB744,253,418, RMB2,284,506, RMB94,102,502 and RMB65,536,412 (2021: RMB694,724,288, RMB1,965,774, RMB125,771,056 and RMB65,528,632), respectively. | |
| The costs of fixed assets transferred from construction in progress amounted to RMB655,886,896 (2021: RMB2,121,335,033). |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) | |||||||||
| (14) | Fixed assets (Cont’d) | |||||||||
| (a) | Fixed assets (Cont’d) | |||||||||
| (i) | Temporarily idle fixed assets | |||||||||
| As at 31 December 2022, the fixed assets with a carrying amount of approximately RMB507,898,988 (a cost of RMB1,521,049,605) (31 December 2021: a carrying amount of approximately RMB862,054,869 and a cost of RMB2,081,185,910) were temporarily idle due to the reorganisation plan of JMCH and the change of product process, etc. The analysis is as follows: | ||||||||||
| Cost | Accumulated depreciation | Provision for impairment | Carrying amount | |||||||
| Buildings | 409,240,038 | (96,229,817) | - | 313,010,221 | ||||||
| Machinery and equipment | 196,732,613 | (126,996,428) | (5,630,085) | 64,106,100 | ||||||
| Vehicles | 70,527,743 | (52,489,571) | (2,473,956) | 15,564,216 | ||||||
| Moulds | 455,442,876 | (141,677,729) | (312,686,908) | 1,078,239 | ||||||
| Electronic and other equipment | 389,106,335 | (263,110,704) | (11,855,419) | 114,140,212 | ||||||
| 1,521,049,605 | (680,504,249) | (332,646,368) | 507,898,988 | |||||||
| As at 31 December 2022, the fixed assets with a carrying amount of approximately RMB 467,422,993 (a cost of RMB857,618,344) were temporarily idle due to the reorganisation transaction of JMCH, which transaction is still in process and the carrying amount of the related assets was based on the agreed price between both parties, and there was no further impairment charged during this year. | ||||||||||
| (ii) | Fixed assets with pending certificates of ownership: | |||||||||
| Carrying amount | Reasons for not obtaining certificates of ownership | |||||||||
| Buildings | 10,030,719 | Pending procedures | ||||||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) | |||
| (14) | Fixed assets (Cont’d) | |||
| (b) | Fixed assets pending for disposal | |||
| 31 December 2022 | 31 December 2021 | |||
| Electronic and other equipment | 216,104 | 1,096,021 | ||
| Machinery and equipment | 161,363 | 280,051 | ||
| Vehicles | 397 | 35,315 | ||
| 377,864 | 1,411,387 | |||
| (15) | Construction in progress |
| 31 December 2022 | 31 December 2021 | |||||||||||
| Book balance | Provision for impairment | Carrying amount | Book balance | Provision for impairment | Carrying amount | |||||||
| Projects for commercial vehicles | 537,796,267 | 537,796,267 | 159,669,213 | 159,669,213 | ||||||||
| Projects for passenger vehicles | 87,126,228 | 87,126,228 | 118,698,638 | 118,698,638 | ||||||||
| Projects for automobiles factory | 42,929,882 | 42,929,882 | 139,257,147 | 139,257,147 | ||||||||
| Projects for automobile parts factory | 5,424,980 | 5,424,980 | 8,550,792 | 8,550,792 | ||||||||
| Others | 46,026,479 | (691,646) | 45,334,833 | 22,854,528 | (691,646) | 22,162,882 | ||||||
| 719,303,836 | (691,646) | 718,612,190 | 449,030,318 | (691,646) | 448,338,672 | |||||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) |
| (15) | Construction in progress (Cont’d) |
| (a) | Movement of significant projects of construction in progress |
| Project name | Budget (In RMB0’000) | 31 December 2021 | Increase in the current year | Transfer to fixed assets in the current year | Transfer to intangible assets in the current year | 31 December 2022 | % of project investment in budget | Progress of project | Accumulative capitalised borrowing costs | Including: Borrowing costs capitalised in the current year | Source of fund |
| Projects for commercial vehicles | 210,755 | 159,669,213 | 582,720,627 | (204,208,617) | (384,956) | 537,796,267 | 79% | 79% | - | - | Self-owned funds |
| Projects for passenger vehicles | 83,455 | 118,698,638 | 111,588,358 | (143,160,768) | - | 87,126,228 | 57% | 57% | - | - | Self-owned funds |
| Projects for automobiles factory | 329,376 | 139,257,147 | 146,410,429 | (227,723,073) | (15,014,621) | 42,929,882 | 75% | 75% | - | - | Self-owned funds |
| Projects for automobile parts factory | 24,694 | 8,550,792 | 35,296,182 | (38,421,994) | - | 5,424,980 | 79% | 79% | - | - | Self-owned funds |
| Others | 210,755 | 22,854,528 | 130,600,842 | (42,372,444) | (65,056,447) | 46,026,479 | 292,897 | - | Self-owned funds and borrowings |
| 449,030,318 | 1,006,616,438 | (655,886,896) | (80,456,024) | 719,303,836 | 292,897 | - |
| (b) | Provision for impairment of construction in progress | |||||||||
| 31 December 2021 | Increase in the current year | Decrease in the current year | 31 December 2022 | Reason for provision | ||||||
| Other miscellaneous and pending installation projects | (691,646) | - | - | (691,646) | The recoverable amount is lower than the carrying amount | |||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) |
| (16) | Right-of-use assets |
| Buildings | |||
| Cost | |||
| 31 December 2021 | 362,092,645 | ||
| Increase in the current year | |||
| New lease contracts | 1,986,861 | ||
| Decrease in the current year | |||
| Expiration of lease contract | (5,140,648) | ||
| Early termination of lease | (9,795,685) | ||
| 31 December 2022 | 349,143,173 | ||
| Accumulated depreciation | |||
| 31 December 2021 | (55,866,835) | ||
| Increase in the current year | |||
| Provision | (70,119,650) | ||
| Decrease in the current year | |||
| Expiration of lease contract | 5,140,648 | ||
| Early termination of lease | 5,325,554 | ||
| 31 December 2022 | (115,520,283) | ||
| Provision for impairment | |||
| 31 December 2021 | - | ||
| Increase in the current year | - | ||
| Decrease in the current year | - | ||
| 31 December 2022 | - | ||
| Carrying amount | |||
| 31 December 2022 | 233,622,890 | ||
| 31 December 2021 | 306,225,810 |
| In 2022, depreciation of right-of-use assets amounted to RMB70,119,650 (2021:RMB41,536,327), of which RMB63,990,089, RMB819,882, RMB4,797,645 and RMB512,034 were included in cost of sales, selling and distribution expenses, general and administrative expenses and research and development expenses, respectively (2021: RMB32,683,225, RMB3,824,867, RMB3,998,038 and RMB1,030,197 were included in cost of sales, selling and distribution expenses, general and administrative expenses and research and development expenses, respectively). |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) | ||||||
| (17) | Intangible assets/Development expenditures | ||||||
| (a) | Intangible assets | ||||||
| Land use rights | Software use fees | Non-patent technologies | After-sales services management mode | Others | Total | ||
| Cost | |||||||
| 31 December 2021 | 755,093,373 | 255,342,587 | 779,747,498 | 36,979,184 | 1,599,516 | 1,828,762,158 | |
| Increase in the current year | |||||||
| Purchase in the current period | - | - | 137,413,132 | - | - | 137,413,132 | |
| Transfer from construction in progress | - | 80,456,024 | - | - | - | 80,456,024 | |
| Internal research and development | - | - | 168,941,375 | - | - | 168,941,375 | |
| Decrease in the current year | |||||||
| Disposal | (126,129,216) | (1,160,305) | - | - | - | (127,289,521) | |
| 31 December 2022 | 628,964,157 | 334,638,306 | 1,086,102,005 | 36,979,184 | 1,599,516 | 2,088,283,168 | |
| Accumulated amortisation | |||||||
| 31 December 2021 | (186,339,168) | (157,597,674) | (333,557,694) | (36,979,184) | (1,599,516) | (716,073,236) | |
| Increase in the current year | |||||||
| Provision | (13,480,034) | (34,744,897) | (151,199,572) | - | - | (199,424,503) | |
| Decrease in the current year | |||||||
| Disposal | 59,866,979 | 1,160,305 | - | - | - | 61,027,284 | |
| 31 December 2022 | (139,952,223) | (191,182,266) | (484,757,266) | (36,979,184) | (1,599,516) | (854,470,455) | |
| Provision for impairment | |||||||
| 31 December 2021 | - | - | (38,806,961) | - | - | (38,806,961) | |
| Increase in the current year | - | - | - | - | - | - | |
| Provision | - | - | - | - | - | - | |
| 31 December 2022 | - | - | (38,806,961) | - | - | (38,806,961) | |
| Carrying amount | |||||||
| 31 December 2022 | 489,011,934 | 143,456,040 | 562,537,778 | - | - | 1,195,005,752 | |
| 31 December 2021 | 568,754,205 | 97,744,913 | 407,382,843 | - | - | 1,073,881,961 | |
| In 2022, amortisation charged to intangible assets amounted to RMB199,424,503 (2021: RMB160,287,903), of which RMB48,142, RMB454,024, RMB44,307,505 and RMB154,614,832 were included in cost of sales, selling and distribution expenses, general and administrative expenses and research and development expenses (2021: RMB415,534, RMB363,744, RMB40,110,291 and RMB119,398,334), respectively. | |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) | |||||||||
| (17) | Intangible assets/Development expenditures (Cont’d) | |||||||||
| (b) | Development expenditures | |||||||||
| The Group’s development expenditures are set out below: | ||||||||||
| 31 December 2021 | Increase in the current year | Decrease in the current year | 31 December 2022 | |||||||
| Recognised in profit or loss | Recognised as intangible assets | |||||||||
| Automobile products development project | 111,004,350 | 535,170,902 | - | (168,941,375) | 477,233,877 | |||||
| Expenditures on research and development of the Group incurred in 2022 amounted to RMB2,018,500,532 (2021: RMB1,886,139,707) in total, of which RMB1,483,329,630 (2021: RMB1,709,014,171) was recognised in profit or loss for the current period, RMB535,170,902 (2021: RMB177,125,536) was recognised in development expenditures for the current period and RMB77,578,667 (2021: RMB66,121,186) transferred from development expenditures to intangible assets for the current period and RMB457,592,235 (2021: RMB111,004,350) was included in the ending balance of development expenditures. As at 31 December 2022, the intangible assets developed by the Group accounted for 36% (31 December 2021: 38%) of the carrying amount of intangible assets. | ||||||||||
| (18) | Deferred tax assets and deferred tax liabilities | |||||||
| (a) | Deferred tax assets before offsetting | |||||||
| 31 December 2022 | 31 December 2021 | |||||||
| Deductible temporary differences and deductible losses | Deferred tax assets | Deductible temporary differences and deductible losses | Deferred tax assets | |||||
| Accrued expenses and provisions | 4,978,763,776 | 1,120,987,322 | 4,820,934,400 | 1,096,537,713 | ||||
| Recoverable losses | 3,634,617,217 | 571,696,850 | 1,878,611,797 | 282,043,452 | ||||
| Provision for asset impairment | 1,092,015,809 | 168,415,220 | 1,209,522,802 | 186,548,154 | ||||
| Non-patent technology | 208,440,047 | 50,268,260 | 155,010,935 | 34,890,219 | ||||
| Employee education funds unpaid | 88,505,949 | 13,780,833 | 67,882,259 | 10,494,123 | ||||
| Deferred income | 60,849,643 | 9,127,446 | 49,074,545 | 7,361,182 | ||||
| Retirement benefits plan | 55,374,000 | 13,438,000 | 59,941,000 | 14,147,350 | ||||
| Others | 174,643,793 | 29,512,438 | 138,426,727 | 23,420,738 | ||||
| 10,293,210,234 | 1,977,226,369 | 8,379,404,465 | 1,655,442,931 | |||||
| Including: | ||||||||
| Expected to be recovered within 1 year (inclusive) | 1,399,402,738 | 1,320,586,445 | ||||||
| Expected to be recovered after 1 year | 577,823,631 | 334,856,486 | ||||||
| 1,977,226,369 | 1,655,442,931 | |||||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) |
| (18) | Deferred tax assets and deferred tax liabilities (Cont’d) | |||||||
| (b) | Deferred tax liabilities before offsetting | |||||||
| 31 December 2022 | 31 December 2021 | |||||||
| Taxable temporary differences | Deferred tax liabilities | Taxable temporary differences | Deferred tax liabilities | |||||
| Depreciation of fixed assets | 2,823,844,034 | 652,665,271 | 1,685,457,873 | 353,019,830 | ||||
| Equity transactions between parent and subsidiary | 408,000,000 | 61,200,000 | 408,000,000 | 61,200,000 | ||||
| Differences between the fair value of the identifiable net assets and carrying amount arising from business combinations involving enterprises not under common control | 93,221,436 | 23,305,359 | 96,002,180 | 24,000,545 | ||||
| Amortisation of intangible assets | 56,434,371 | 12,193,000 | 45,631,805 | 7,847,331 | ||||
| Others | 2,972,698 | 445,905 | 242,329 | 60,582 | ||||
| 3,384,472,539 | 749,809,535 | 2,235,334,187 | 446,128,288 | |||||
| Including: | ||||||||
| Expected to be recovered within 1 year (inclusive) | 145,213,640 | 116,988,634 | ||||||
| Expected to be recovered after 1 year | 604,595,895 | 329,139,654 | ||||||
| 749,809,535 | 446,128,288 | |||||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) | ||||||||
| (18) | Deferred tax assets and deferred tax liabilities (Cont’d) | ||||||||
| (c) | Deductible temporary differences and deductible losses for which no deferred tax asset was recognised are analysed as follows: | ||||||||
| 31 December 2022 | 31 December 2021 | ||||||||
| Deductible temporary differences | 1,380,025,289 | 1,380,010,739 | |||||||
| Deductible losses | 202,505,688 | 108,539,538 | |||||||
| 1,582,530,977 | 1,488,550,277 | ||||||||
| (d) | Deductible losses for which no deferred tax asset was recognised will be expired in following years: | ||||||||
| 31 December 2022 | 31 December 2021 | ||||||||
| 2024 | 109,336,011 | 108,539,538 | |||||||
| 2025 | - | - | |||||||
| 2026 | - | - | |||||||
| 2027 | 93,169,677 | - | |||||||
| 202,505,688 | 108,539,538 | ||||||||
| (e) | The net balances of deferred tax assets and deferred tax liabilities after offsetting are as follows: | ||||||||
| 31 December 2022 | 31 December 2021 | ||||||||
| Offsetting amount | Balance after offsetting | Offsetting amount | Balance after offsetting | ||||||
| Deferred tax assets | (726,504,176) | 1,250,722,193 | (422,127,743) | 1,233,315,188 | |||||
| Deferred tax liabilities | (726,504,176) | 23,305,359 | (422,127,743) | 24,000,545 | |||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) |
| (19) | Provision for asset impairment and losses |
| 31 December 2021 | Increase in the current year | Decrease in the current year | 31 December | |||||||
| Reversal | Write-off/Disposal | 2022 | ||||||||
| Provision for bad debts of notes receivable | - | 318,421 | - | - | 318,421 | |||||
| Provision for bad debts of accounts receivable | 218,532,668 | 35,727,702 | (23,230,284) | (109,506,718) | 121,523,368 | |||||
| Including: Provision for bad debts on the individual basis | 184,043,298 | 35,727,702 | (110,068) | (109,506,718) | 110,154,214 | |||||
| Provision for bad debts on the grouping basis | 34,489,370 | - | (23,120,216) | - | 11,369,154 | |||||
| Provision for bad debts of other receivables | 1,036,560 | - | (701,952) | - | 334,608 | |||||
| Provision for bad debts of long-term receivables | 193,127 | - | (47,041) | - | 146,086 | |||||
| Sub-total | 219,762,355 | 36,046,123 | (23,979,277) | (109,506,718) | 122,322,483 | |||||
| Provision for decline in the value of inventories | 76,739,821 | 9,382,217 | (2,902,611) | (11,408,647) | 71,810,780 | |||||
| Provision for impairment of fixed assets | 368,969,709 | 763,162 | - | (15,901,077) | 353,831,794 | |||||
| Provision for impairment of construction in progress | 691,646 | - | - | - | 691,646 | |||||
| Provision for impairment of goodwill | 89,028,412 | - | - | - | 89,028,412 | |||||
| Provision for impairment of intangible assets | 38,806,961 | - | - | - | 38,806,961 | |||||
| Sub-total | 574,236,549 | 10,145,379 | (2,902,611) | (27,309,724) | 554,169,593 | |||||
| 793,998,904 | 46,191,502 | (26,881,888) | (136,816,442) | 676,492,076 | ||||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) | ||||||
| (20) | Short-term borrowings | ||||||
| 31 December 2022 | 31 December 2021 | ||||||
| Credit loan | 1,100,000,000 | 300,000,000 | |||||
| As at 31 December 2022, the above short-term borrowings were all caused by the discount of the Company's commercial acceptance bill, which bear the interest rates ranging from 2.35% to 2.75% (31 December 2021: 2.85%). | |||||||
| (21) | Accounts payable | ||||||
| 31 December 2022 | 31 December 2021 | ||||||
| Payable for automobile parts | 8,783,467,597 | 9,377,900,014 | |||||
| Payable for raw and auxiliary materials | 232,510,757 | 324,684,816 | |||||
| 9,015,978,354 | 9,702,584,830 | ||||||
| As at 31 December 2022, accounts payable with ageing over one year amounted to RMB652,758,141 (31 December 2021: RMB747,156,926), which mainly represented materials payable for which a settlement price had not yet been determined, and such payables had not been finally settled yet. | |||||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) |
| (22) | Contract liabilities |
| 31 December 2022 | 31 December 2021 | |||
| Advances for automobiles and automobile parts | 94,400,145 | 223,779,674 | ||
| Advances for maintenance and warranty services | 175,905,460 | 168,272,152 | ||
| 270,305,605 | 392,051,826 | |||
| Less: Contract liabilities carried forward to revenue after 1 year (Note 4(33)) | (118,240,580) | (119,777,649) | ||
| 152,065,025 | 272,274,177 |
| In 2022, contract liabilities amounting to RMB272,274,177 (2021: RMB558,526,846) included in the carrying amount as at 31 December 2021 were transferred to the revenue of 2022, including advances for automobiles and automobile parts amounting to RMB223,779,674 (2021: RMB521,367,837), and advances for maintenance and warranty services amounting to RMB48,494,503 (2021: RMB37,159,009). |
| (23) | Employee benefits payable | |||
| 31 December 2022 | 31 December 2021 | |||
| Short-term employee benefits payable (a) | 631,243,123 | 593,229,732 | ||
| Defined contribution plans payable (b) | 279,041,381 | 168,161,617 | ||
| Defined benefit plans payable (c) | 2,803,000 | 2,930,000 | ||
| Termination benefits payable (d) | 2,616,176 | 2,665,176 | ||
| 915,703,680 | 766,986,525 | |||
| (a) | Short-term employee benefits | |||||||
| 31 December 2021 | Increase in the current year | Decrease in the current year | 31 December 2022 | |||||
| Wages and salaries, bonus, allowances and subsidies | 465,474,414 | 1,757,682,763 | (1,768,246,254) | 454,910,923 | ||||
| Staff welfare | 39,317,102 | 119,452,745 | (99,602,137) | 59,167,710 | ||||
| Social security contributions | 17,331,862 | 131,440,053 | (124,639,496) | 24,132,419 | ||||
| Including: Medical insurance | 13,375,711 | 123,693,643 | (119,769,236) | 17,300,118 | ||||
| Work injury insurance | 3,956,151 | 7,746,410 | (4,870,260) | 6,832,301 | ||||
| Housing funds | 192,461 | 187,090,100 | (186,814,619) | 467,942 | ||||
| Labour union funds and employee education funds | 70,913,893 | 60,619,181 | (38,968,945) | 92,564,129 | ||||
| Other short-term employee benefits | - | 7,831,282 | (7,831,282) | - | ||||
| 593,229,732 | 2,264,116,124 | (2,226,102,733) | 631,243,123 | |||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) |
| (23) | Employee benefits payable (Cont’d) |
| (b) | Defined contribution plans | |||||||
| 31 December 2021 | Increase in the current year | Decrease in the current year | 31 December 2022 | |||||
| Basic pensions | 163,081,887 | 267,975,504 | (170,530,049) | 260,527,342 | ||||
| Supplementary pensions | - | 10,400,000 | - | 10,400,000 | ||||
| Unemployment insurance | 5,079,730 | 8,361,902 | (5,327,593) | 8,114,039 | ||||
| 168,161,617 | 286,737,406 | (175,857,642) | 279,041,381 | |||||
| (c) | Defined benefit plans | |||||||
| 31 December 2021 | Increase in the current year | Decrease in the current year | 31 December 2022 | |||||
| Post-retirement benefits payable (Note 4(32)) | 2,930,000 | 2,162,448 | (2,289,448) | 2,803,000 | ||||
| (d) | Termination benefits payable | |||
| 31 December 2022 | 31 December 2021 | |||
| Early retirement benefits payable (Note 4(32)) | 1,278,000 | 1,327,000 | ||
| Other termination benefits (i) | 1,338,176 | 1,338,176 | ||
| 2,616,176 | 2,665,176 | |||
| (i) In 2022, other termination benefits paid by the Group for termination of the employment relationship were RMB2,893,734 (2021: RMB16,420,116). | ||||
| (24) | Taxes payable | |||
| 31 December 2022 | 31 December 2021 | |||
| Consumption tax payable | 87,601,901 | 85,326,751 | ||
| Enterprise income tax payable | 55,230,198 | 170,084,881 | ||
| Unpaid VAT | 24,542,717 | 434,482 | ||
| Land use tax payable | 4,831,953 | 6,174,129 | ||
| Others | 21,042,835 | 25,151,477 | ||
| 193,249,604 | 287,171,720 | |||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022
(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) | |||
| (25) | Other payables | |||
| 31 December 2022 | 31 December 2021 | |||
| Promotion expenses | 2,566,403,266 | 2,620,282,716 | ||
| Research and development project expenses | 1,139,399,835 | 877,392,808 | ||
| Construction payment | 534,127,177 | 541,897,265 | ||
| Transportation expenses | 239,369,691 | 273,386,502 | ||
| Advertising and new product planning fees | 160,966,200 | 138,500,269 | ||
| Guarantees payable | 111,554,518 | 131,123,402 | ||
| Technological transformation project expenses | 51,152,889 | 61,104,696 | ||
| Consulting fees | 22,274,659 | 14,322,912 | ||
| Trademark license fee | 13,971,949 | 15,572,521 | ||
| Ordinary share dividends payable | 6,463,836 | 6,463,836 | ||
| Others | 827,024,491 | 573,753,878 | ||
| 5,672,708,511 | 5,253,800,805 | |||
| As at 31 December 2022, other payables with ageing over one year of RMB1,696,105,568 (31 December 2021: RMB1,433,335,159) mainly comprised guarantees collected from logistics companies, distributors and repair stations, payables for construction projects and payables for research and development expenses. Such payables have not been finally settled yet in view of the continuing business transactions with distributors and service providers, and engineering projects and research and development projects that had not yet been accepted and completed. |
| (26) | Current portion of non-current liabilities | ||||
| 31 December 2022 | 31 December 2021 | ||||
| Current portion of lease liabilities (Note 4(29)) | 72,224,685 | 77,621,681 | |||
| Current portion of long-term borrowings (Note 4(28)) | 456,071 | 417,507 | |||
| 72,680,756 | 78,039,188 | ||||
| (27) | Other current liabilities | |||
| 31 December 2022 | 31 December 2021 | |||
| Provisions expected to be settled within 1 year (Note 4(30)) | 374,617,524 | 391,365,455 | ||
| Others | 12,272,018 | 29,091,358 | ||
| 386,889,542 | 420,456,813 | |||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) | |||
| (28) | Long-term borrowings | |||
| 31 December 2022 | 31 December 2021 | |||
| Guaranteed loans(a) | 2,280,355 | 2,505,044 | ||
| Credit loans(b) | 19,033,773 | - | ||
| Less: Current portion of long-term borrowings (Note 4(26)) | (456,071) | (417,507) | ||
| 20,858,057 | 2,087,537 | |||
| (a) | As at 31 December 2022, the above guaranteed loans were long-term borrowings amounting to USD 327,421 guaranteed by JMCF, borrowed from Industrial and Commercial Bank of China (“ICBC”), Nanchang Ganjiang Sub-branch with interests paid every half year and the principal was paid in instalments between 10 December 2007 and 27 October 2027. | |||||||||
| Starting date | Maturity date | Currency | Interest rate (%) | 31 December 2022 | 31 December 2021 | |||||
| Amount in foreign currency | RMB equivalent | Amount in foreign currency | RMB equivalent | |||||||
| ICBC Nanchang Ganjiang Sub - branch | 27 February 1998 | 27 October 2027 | USD | 1.5% | 327,421 | 2,280,355 | 392,905 | 2,505,044 | ||
| (b) | As at December 31, 2022, the principal amount of bank credit borrowings is repayable in installments during 2024. In 2022, the interest rate of long-term borrowings was 1.5-2.5% (2021: 1.5%). |
| (29) | Lease liabilities | ||||
| 31 December 2022 | 31 December 2021 | ||||
| Lease liabilities(a) | 265,315,036 | 341,031,095 | |||
| Less: Current portion of non-current liabilities (Note 4(26)) | (72,224,685) | (77,621,681) | |||
| 193,090,351 | 263,409,414 | ||||
| (a) | |||||
As at 31 December 2022, the Group has no leases that are not included in lease liabilitiesbut will result in potential future cash outflows.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) | |||||||
| (30) | Provisions | |||||||
| 31 December 2021 | Increase in the current year | Decrease in the current year | 31 December 2022 | |||||
| Product warranties (a) | 569,247,478 | 381,747,663 | (340,962,074) | 610,033,067 | ||||
| Provisions for contract fulfilment | 19,705,141 | - | (4,358,095) | 15,347,046 | ||||
| 588,952,619 | 381,747,663 | (345,320,169) | 625,380,113 | |||||
| Less: Provisions expected to be settled within 1 year (Note 4(27)) | (391,365,455) | (374,617,524) | ||||||
| 197,587,164 | 250,762,589 | |||||||
| (a) | Product warranties are expenses expected to be incurred during the warranty period from free after-sales services, product warranty and other services for the vehicles sold. | |||||||||
| (31) | Deferred income | |||||||||
| 31 December 2021 | Increase in the current year | Decrease in the current year | 31 December 2022 | Reason | ||||||
| Government grants | 49,074,545 | 13,525,000 | (1,749,902) | 60,849,643 | Subsidy for projects | |||||
| (a) | Government grants | |||||||||
| 31 December 2021 | Increase in the current year | Decrease in the current year | ||||||||
| Recognised in other income | 31 December 2022 | Asset related/ Income related | ||||||||
| Research and development-related subsidies | 48,170,026 | 1,900,000 | (810,319) | 49,259,707 | Income related | |||||
| Equipment purchasing-related subsidies | - | 11,275,000 | (939,583) | 10,335,417 | Asset related | |||||
| Others | 904,519 | 350,000 | - | 1,254,519 | Income related | |||||
| 49,074,545 | 13,525,000 | (1,749,902) | 60,849,643 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) |
| (32) | Long-term employee benefits payable | |||
| 31 December 2022 | 31 December 2021 | |||
| Supplementary retirement benefits and early-retirement benefits eligible for recognition of provisions | 55,374,000 | 59,941,000 | ||
| Less: Payable within 1 year | (4,081,000) | (4,257,000) | ||
| 51,293,000 | 55,684,000 | |||
| The retirement and early-retirement benefits payable within one year are included in employee benefits payable (Note 4(23)(c), (d)). | ||||
| For retired and early-retired employees, the Group provides them with a certain amount of supplementary benefits during their retirement or early-retirement period. The amount of benefits depends on the employee’s position, length of service and salary at the time of retirement or early-retirement, and is adjusted in accordance with inflation rate and other factors. The Group’s obligations for supplementary retirement and early-retirement benefits as at the balance sheet date were calculated using projected unit credit method and were reviewed by an external independent actuary. | ||||
| (a) | Movements of retirement and early-retirement benefits of the Group are as follows: | ||||
| Present value of the obligations of the defined benefit plan | |||||
| 31 December 2022 | 31 December 2021 | ||||
| Opening balance | 59,941,000 | 67,587,000 | |||
| Cost of defined benefit plans recognised in profit or loss for the current period | |||||
| - Current service cost | 1,161,000 | 1,346,000 | |||
| - Past service cost | - | (14,664,000) | |||
| - Actuarial gains or losses recognised immediately | 82,000 | 800,000 | |||
| - Net interest | 1,744,000 | 2,463,000 | |||
| Remeasurement of net liabilities for defined benefit plans | |||||
| - Actuarial gains or losses | (3,918,000) | 6,218,000 | |||
| Other movements | |||||
| - Benefits paid | (3,636,000) | (3,809,000) | |||
| Ending balance | 55,374,000 | 59,941,000 | |||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) |
| (32) | Long-term employee benefits payable (Cont’d) |
| (b) | The major actuarial assumptions used to determine the present value of defined benefit plan obligations | ||||
| 31 December 2022 | 31 December 2021 | ||||
| Discount rate | 3.00% | 3.00% | |||
| Inflation rate | 2.00% | 2.00% | |||
| Salaries and benefits growth rates | 0%-6% | 0%-6% | |||
| Future mortality assumptions were determined based on the China Life Insurance Mortality Table (2010-2013), which is publicly available statistical information for the Chinese region. | |||||
| (c) | The sensitivity analysis of the major actuarial assumptions used to determine the present value of defined benefit plan obligations is as follows: |
| Variation in assumptions | Effect on present value of defined benefit obligations | ||||||
| Assumed increase | Assumed decrease | ||||||
| Discount rate | 0.5% | Decrease of 5.6% | Increase of 6.4% | ||||
| Inflation rate | 0.5% | Increase of 3.7% | Decrease of 3.2% | ||||
| The above sensitivity analysis is based on a change in an assumption while holding all other assumptions constant. In practice, changes in some of the assumptions may be correlated. The projected unit credit method is also utilised in calculating the present value of the defined benefit obligations in the analysis. | |||||||
| (d) | Supplementary retirement and early-retirement benefits expose the Group to various risks, mainly including risk of changes in the interest rate of treasury bonds, inflation risk, etc. Decline in the interest rate of treasury bonds will lead to an increase in defined benefit plan liabilities. Supplementary retirement and early-retirement benefits obligations keep pace with inflation, and the rise in inflation will increase the defined benefit plan liabilities. | ||||||
| (33) | Other non-current liabilities | ||||||
| 31 December 2022 | 31 December 2021 | ||||||
| Contract liabilities carried forward to revenue after 1 year (Note 4(22)) | 118,240,580 | 119,777,649 | |||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022
(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) | |||||||||||||
| (34) | Share capital | |||||||||||||
| 31 December 2021 | Movements for the current year | 31 December 2022 | ||||||||||||
| Shares newly issued | Bonus share | Transfer from capital surplus | Others | Sub-total | ||||||||||
| Shares subject to trading restriction - | ||||||||||||||
| Other domestic shares | ||||||||||||||
| Including: Shares held by domestic non-state-owned legal persons | 745,140 | - | - | - | - | - | 745,140 | |||||||
| Shares held by domestic natural persons | 5,700 | - | - | - | - | - | 5,700 | |||||||
| 750,840 | - | - | - | - | - | 750,840 | ||||||||
| Shares not subject to trading restriction - | ||||||||||||||
| Ordinary shares denominated in RMB | 518,463,160 | - | - | - | - | - | 518,463,160 | |||||||
| Domestically listed foreign shares | 344,000,000 | - | - | - | - | - | 344,000,000 | |||||||
| 862,463,160 | - | - | - | - | - | 862,463,160 | ||||||||
| 863,214,000 | - | - | - | - | - | 863,214,000 | ||||||||
| Since the implementation of the Company’s Scheme on Share Split Reform on 13 February 2006, as at 31 December 2022, there were 750,840 shares currently unavailable for trading. During the reporting period, there was no shares with trading restrictions released from the restricted conditions. | ||||||||||||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) | |||||||||||||
| (34) | Share capital (Cont’d) | |||||||||||||
| 31 December 2020 | Movements for the current year | 31 December 2021 | ||||||||||||
| Shares newly issued | Bonus share | Transfer from capital surplus | Others | Sub-total | ||||||||||
| Shares subject to trading restriction - | ||||||||||||||
| Other domestic shares | ||||||||||||||
| Including: Shares held by domestic non-state-owned legal persons | 745,140 | - | - | - | - | - | 745,140 | |||||||
| Shares held by domestic natural persons | 5,700 | - | - | - | - | - | 5,700 | |||||||
| 750,840 | - | - | - | - | - | 750,840 | ||||||||
| Shares not subject to trading restriction - | ||||||||||||||
| Ordinary shares denominated in RMB | 518,463,160 | - | - | - | - | - | 518,463,160 | |||||||
| Domestically listed foreign shares | 344,000,000 | - | - | - | - | - | 344,000,000 | |||||||
| 862,463,160 | - | - | - | - | - | 862,463,160 | ||||||||
| 863,214,000 | - | - | - | - | - | 863,214,000 | ||||||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) | |||||||
| (35) | Capital surplus | |||||||
| 31 December 2021 | Increase in the current year | Decrease in the current year | 31 December 2022 | |||||
| Share premium | 816,609,422 | - | - | 816,609,422 | ||||
| Other capital surplus | 22,833,068 | - | - | 22,833,068 | ||||
| 839,442,490 | - | - | 839,442,490 | |||||
| 31 December 2020 | Increase in the current year | Decrease in the current year | 31 December 2021 | |||||
| Share premium | 816,609,422 | - | - | 816,609,422 | ||||
| Other capital surplus | 22,833,068 | - | - | 22,833,068 | ||||
| 839,442,490 | - | - | 839,442,490 | |||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) | |||||||||
| (36) | Other comprehensive income | |||||||||
| Other comprehensive income in the balance sheet | Other comprehensive income in the income statement for the year ended 31 December 2022 | |||||||||
| 31 December 2021 | Attributable to the parent company after tax | 31 December 2022 | Amount incurred before income tax for the current year | Less: Transfer-out of previous other comprehensive income in the current year | Less: Income tax expenses | Attributable to the parent company after tax | Attributable to the subsidiary after tax | |||
| Other comprehensive income that will not be reclassified to profit or loss | ||||||||||
| Actuarial gains on defined benefit plans | (16,422,750) | 2,938,500 | (13,484,250) | 3,918,000 | - | (979,500) | 2,938,500 | - | ||
| Other comprehensive income in the balance sheet | Other comprehensive income in the income statement for the year ended 31 December 2021 | |||||||||
| 31 December 2020 | Attributable to the parent company after tax | 31 December 2021 | Amount incurred before income tax for the current year | Less: Transfer-out of previous other comprehensive income in the current year | Less: Income tax expenses | Attributable to the parent company after tax | Attributable to the subsidiary after tax | |||
| Other comprehensive income that will not be reclassified to profit or loss | ||||||||||
| Actuarial gains on defined benefit plans | (11,759,250) | (4,663,500) | (16,422,750) | (6,218,000) | - | 1,554,500 | (4,663,500) | - | ||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) |
| (37) | Surplus reserve |
| 31 December 2021 | Increase in the current year | Decrease in the current year | 31 December 2022 | |||||
| Statutory surplus reserve | 431,607,000 | - | - | 431,607,000 |
| 31 December 2020 | Increase in the current year | Decrease in the current year | 31 December 2021 | |||||
| Statutory surplus reserve | 431,607,000 | - | - | 431,607,000 |
| In accordance with the Company Law of the People’s Republic of China, the Company’s Articles of Association and the resolution of the Board of Directors, the Company should appropriate 10% of net profit for the year to the statutory surplus reserve, and the Company can cease appropriation when the statutory surplus reserve accumulated to more than 50% of the registered capital. The statutory surplus reserve can be used to make up for the loss or increase the share capital upon approval from the appropriate authorities. As the accumulated appropriation to the statuary surplus reserve exceeded 50% of the registered capital, no appropriation was made in the current year (2021: Nil). | |
| The Company reserves the discretionary surplus reserve after the shareholders’ meeting approves the proposal from the Board of Directors. The discretionary surplus reserve can be used to compensate for the losses incurred in prior years or increase the share capital upon approval from appropriate authorities. |
| (38) | Retained earnings | |||
| 2022 | 2021 | |||
| Retained earnings at the beginning of the year | 6,437,603,849 | 8,863,969,769 | ||
| Add: Net profit attributable to shareholders of the parent company for the current year | 915,049,168 | 574,165,944 | ||
| Less: Ordinary share dividends payable (a) | (229,614,924) | (3,000,531,864) | ||
| Retained earnings at the end of the year | 7,123,038,093 | 6,437,603,849 |
| (a) | According to the resolution of the shareholders’ meeting on 24 June 2022, the Company distributed cash dividends of RMB0.266 per share to all shareholders, calculated on the basis of 863,214,000 issued shares, for a total of RMB229,614,924. |
| According to the resolution of the meeting of Board of Directors on 28 March 2023, the Board of Directors proposed to distribute cash dividends of RMB0.424 per share to all shareholders, calculated on the basis of 863,214,000 issued shares, for a total of RMB366,002,736 (Note 10). |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) | |||
| (39) | Revenue and cost of sales | |||
| 2022 | 2021 | |||
| Revenue from main operations | 29,592,525,919 | 34,530,048,320 | ||
| Revenue from other operations | 507,757,923 | 691,258,152 | ||
| 30,100,283,842 | 35,221,306,472 | |||
| 2022 | 2021 | |||
| Cost of sales from main operations | 25,336,987,529 | 29,485,820,650 | ||
| Cost of sales from other operations | 475,277,339 | 631,633,717 | ||
| 25,812,264,868 | 30,117,454,367 |
| (a) | Revenue and cost of sales from main operations | |||||
| 2022 | 2021 | |||||
| Revenue from main operations | Cost of sales from main operations | Revenue from main operations | Cost of sales from main operations | |||
| Sales of automobiles | 27,069,207,538 | 23,355,537,374 | 32,317,182,099 | 27,809,982,305 | ||
| Sales of automobile parts | 2,412,993,540 | 1,872,040,360 | 2,101,505,690 | 1,557,352,106 | ||
| Automobile maintenance services, etc. | 110,324,841 | 109,409,795 | 111,360,531 | 118,486,239 | ||
| 29,592,525,919 | 25,336,987,529 | 34,530,048,320 | 29,485,820,650 | |||
| (b) | Revenue and cost of sales from other operations | |||||
| 2022 | 2021 | |||||
| Revenue from other operations | Cost of sales from other operations | Revenue from other operations | Cost of sales from other operations | |||
| Sales of materials | 366,469,354 | 339,411,405 | 561,673,748 | 505,559,175 | ||
| Others | 141,288,569 | 135,865,934 | 129,584,404 | 126,074,542 | ||
| 507,757,923 | 475,277,339 | 691,258,152 | 631,633,717 | |||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) | |||||
| (39) | Revenue and cost of sales (Cont’d) | |||||
| (c) | The Group’s revenue is broken down as follows: | |||||
| 2022 | ||||||
| Automobiles | Automobile parts | Automobile maintenance services, etc. | Materials and others | Total | ||
| Revenue from main operations | 27,069,207,538 | 2,412,993,540 | 110,324,841 | - | 29,592,525,919 | |
| Including: Recognised at a time point | 27,069,207,538 | 2,412,993,540 | - | - | 29,482,201,078 | |
| Recognised within a certain period | - | - | 110,324,841 | - | 110,324,841 | |
| Revenue from other operations (i) | - | - | - | 507,757,923 | 507,757,923 | |
| 27,069,207,538 | 2,412,993,540 | 110,324,841 | 507,757,923 | 30,100,283,842 | ||
| 2021 | ||||||
| Automobiles | Automobile parts | Automobile maintenance services, etc. | Materials and others | Total | ||
| Revenue from main operations | 32,317,182,099 | 2,101,505,690 | 111,360,531 | - | 34,530,048,320 | |
| Including: Recognised at a time point | 32,317,182,099 | 2,101,505,690 | - | - | 34,418,687,789 | |
| Recognised within a certain period | - | - | 111,360,531 | - | 111,360,531 | |
| Revenue from other operations (i) | - | - | - | 691,258,152 | 691,258,152 | |
| 32,317,182,099 | 2,101,505,690 | 111,360,531 | 691,258,152 | 35,221,306,472 | ||
| (i) | The Group's Revenue from other operations includes sales of materials and technical service provided, etc. Of which, revenue from sales of materials is recognized at a certain point in time, and revenue from technical service provided is recognized within a certain period | |||
| As at 31 December 2022, the amount of revenue corresponding to the performance obligations that the Group has signed but has not performed or has not yet performed is RMB270,305,605, of which the Group expects that RMB94,400,145 and RMB57,664,880 will be recognised as revenue from the sales of automobiles and parts and revenue from the sales of automobile maintenance services, etc respectively in 2023, RMB118,240,580 will be recognised as revenue from automobile maintenance services, etc during 2024 to 2028. | ||||
| (40) | Taxes and surcharges | |||
| 2022 | 2021 | |||
| Consumption tax | 690,818,768 | 760,386,647 | ||
| City maintenance and construction tax | 99,989,565 | 82,265,926 | ||
| Educational surcharge | 98,742,654 | 76,717,032 | ||
| Land use tax | 22,286,670 | 18,625,222 | ||
| Real estate tax | 20,887,510 | 17,284,111 | ||
| Stamp duty | 18,217,884 | 12,397,463 | ||
| Others | 451,064 | 472,592 | ||
| 951,394,115 | 968,148,993 | |||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) | |||
| (41) | Selling and distribution expenses | |||
| 2022 | 2021 | |||
| Promotion expenses | 413,790,869 | 462,406,230 | ||
| Warranties | 381,747,663 | 454,077,121 | ||
| Employee benefits | 214,370,379 | 189,694,233 | ||
| Advertising and new product planning fees | 187,517,174 | 186,501,944 | ||
| Storage expenses | 48,853,162 | 48,592,062 | ||
| Packaging material expenses | 31,608,268 | 36,696,621 | ||
| Sales network construction expenses | 10,037,336 | 14,063,346 | ||
| Depreciation and amortisation expenses | 3,558,412 | 6,154,385 | ||
| Others | 153,411,448 | 133,622,101 | ||
| 1,444,894,711 | 1,531,808,043 | |||
| (42) | General and administrative expenses | |||
| 2022 | 2021 | |||
| Employee benefits | 544,315,552 | 576,689,666 | ||
| Depreciation and amortisation expenses | 143,207,652 | 169,879,385 | ||
| Trademark license fee | 68,813,097 | 56,532,031 | ||
| Repair expenses | 37,951,031 | 56,019,261 | ||
| Consulting expenses | 26,261,406 | 38,531,796 | ||
| General office expenses | 17,095,983 | 26,545,639 | ||
| Cartage fee | 11,458,649 | 40,886,163 | ||
| Others | 115,682,975 | 187,134,649 | ||
| 964,786,345 | 1,152,218,590 | |||
| (43) | Research and development expenses | |||
| 2022 | 2021 | |||
| Employee benefits | 430,170,063 | 483,915,948 | ||
| Design fee | 304,491,964 | 378,814,577 | ||
| Depreciation and amortisation expenses | 220,663,278 | 185,957,163 | ||
| Materials expenses | 197,330,293 | 204,200,408 | ||
| Technology development expenses | 190,609,379 | 239,561,528 | ||
| Others | 140,064,653 | 216,564,547 | ||
| 1,483,329,630 | 1,709,014,171 | |||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) | |||
| (44) | Financial expenses | |||
| 2022 | 2021 | |||
| Interest costs | 36,417,358 | 17,868,043 | ||
| Add: Interest costs on lease liabilities | 12,887,851 | 7,532,316 | ||
| Less: Government grants | - | (1,760,125) | ||
| Interest expenses | 49,305,209 | 23,640,234 | ||
| Less: Interest income from cash at bank | (220,037,622) | (257,779,550) | ||
| Other interest income | (16,271,337) | (42,622,289) | ||
| Interest income | (236,308,959) | (300,401,839) | ||
| Exchange gains or losses | 22,205,504 | (21,273,861) | ||
| Others | 890,900 | 2,279,909 | ||
| (163,907,346) | (295,755,557) | |||
| (45) | Expenses by nature | |||
| The cost of sales, selling and distribution expenses, general and administrative expenses and research and development expenses in the income statement are listed as follows by nature: | ||||
| 2022 | 2021 | |||
| Changes in inventories of finished goods and work in progress | (3,902,524) | 137,184,837 | ||
| Consumed raw materials and low value consumables, etc. | 22,878,764,631 | 26,762,865,094 | ||
| Employee benefits | 2,556,734,264 | 2,614,387,917 | ||
| Depreciation of fixed assets | 906,176,838 | 887,989,750 | ||
| Amortisation of intangible assets | 199,424,503 | 160,287,903 | ||
| Depreciation of right-of-use assets | 70,119,650 | 41,536,327 | ||
| Transportation expenses | 610,883,899 | 803,085,951 | ||
| Promotion expenses | 413,790,869 | 462,406,230 | ||
| Warranties | 381,747,663 | 454,077,121 | ||
| Design fee | 304,491,964 | 378,814,577 | ||
| Technology development expenses | 190,609,379 | 239,561,528 | ||
| Advertising and new product planning fees | 187,517,174 | 186,501,944 | ||
| Fixed asset repair and maintenance expenses (a) | 122,958,397 | 184,972,267 | ||
| Others | 885,958,847 | 1,196,823,725 | ||
| 29,705,275,554 | 34,510,495,171 | |||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) | |||
| (45) | Expenses by nature (Cont’d) | |||
| (a) | The Group includes daily maintenance expenses ineligible for the capitalisation of fixed assets regarding the production and processing of inventories into cost of inventories, which will be carried forward to cost of sales, and those regarding the R&D Department, Administrative Department, and Sales Department are included in research and development expenses, management expenses and selling and distribution expenses respectively. | |||
| (b) | As stated in Note 2(22), the Group directly recognises the lease payments of short-term lease and low value lease into profit or loss for the current period. In 2022, the amount was RMB5,147,442 (2021: RMB1,066,925). | |||
| The lessor exempted the Group from paying the rental of RMB22,851 for the 2022, and the Group has deducted the above rental waivers against the rental expense for the current period (2021: RMB47,937). | ||||
| (46) | Asset impairment losses | |||
| 2022 | 2021 | |||
| Losses on decline in the value of inventories | 6,479,606 | 39,635,051 | ||
| Impairment of fixed assets | 763,162 | 3,638,401 | ||
| 7,242,768 | 43,273,452 | |||
| (47) | Credit impairment losses | |||
| 2022 | 2021 | |||
| Losses on bad debts of notes receivable | 318,421 | - | ||
| Losses on bad debts of accounts receivable | 12,497,418 | (15,345,078) | ||
| Losses on bad debts of other receivables | (701,952) | 823,789 | ||
| Losses on bad debts of long-term receivables | (47,041) | 193,127 | ||
| 12,066,846 | (14,328,162) | |||
| (48) | Other income | |||||
| 2022 | 2021 | Asset related/ Income related | ||||
| Supporting funds by government | 906,908,600 | 516,410,000 | Income related | |||
| Equipment purchasing-related subsidies | 939,583 | - | Asset related | |||
| Research and development activities related subsidies | 810,319 | 11,770,150 | Income related | |||
| Other subsidies related with daily operation | 34,668,054 | 22,891,095 | Income related | |||
| 943,326,556 | 551,071,245 | |||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) |
| (49) | Investment income | |||
| 2022 | 2021 | |||
| Losses on discount of financing receivables eligible for derecognition | (15,303,265) | (25,013,202) | ||
| Investment loss from forward exchange settlement | (13,534,785) | (20,618,121) | ||
| Losses on long-term equity investments under equity method | (8,768,433) | (22,245,293) | ||
| Investment income from financial assets held for trading | 1,523,836 | 15,174,593 | ||
| Investment income from disposal of long-term equity investments | - | 52,133,307 | ||
| (36,082,647) | (568,716) | |||
| There is no significant restriction on the remittance of investment income of the Group. | ||||
| (50) | Gains on changes in fair value | |||
| 2022 | 2021 | |||
| Derivative financial assets and derivative financial liabilities - | ||||
| Gains/(Loss) on forward exchange contracts | 13,677,317 | (6,987,892) | ||
| Financial assets at fair value through profit or loss - | ||||
| Structural deposits | (242,329) | (3,650,656) | ||
| 13,434,988 | (10,638,548) | |||
| (51) | Gains on disposal of assets | |||||
| 2022 | 2021 | Amount recognised in non-recurring profit or loss in 2022 | ||||
| Gains on disposal of assets (i) | 391,369,117 | 16,977,005 | 391,369,117 | |||
| (i) | The gains generated from disposal of land and above-ground buildings of Qingyunpu Factory in this year was RMB394,117,791. | |||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) | |||||
| (52) | Non-operating income | |||||
| 2022 | 2021 | Amount recognised in non-recurring profit or loss in 2022 | ||||
| Compensation and penalty income | 3,539,296 | 3,437,808 | 3,539,296 | |||
| Others | 248,972 | 1,169,029 | 248,972 | |||
| 3,788,268 | 4,606,837 | 3,788,268 | ||||
| (53) | Non-operating expenses | ||||||||
| 2022 | 2021 | Amount recognised in non-recurring profit or loss in 2022 | |||||||
| Losses on scrapping of assets | 2,117,642 | 11,869,191 | 2,117,642 | ||||||
| Donations | 2,007,280 | 1,995,000 | 2,007,280 | ||||||
| Others | 357,040 | 584,761 | 357,040 | ||||||
| 4,481,962 | 14,448,952 | 4,481,962 | |||||||
| (54) | Income tax expenses | ||||||||
| 2022 | 2021 | ||||||||
| Current income tax calculated based on tax law and related regulations | 55,769,297 | 170,451,319 | |||||||
| Deferred income tax | (19,081,691) | (188,145,817) | |||||||
| 36,687,606 | (17,694,498) | ||||||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) |
| (54) | Income tax expenses (Cont’d) |
| The reconciliation from income tax calculated based on the applicable tax rates and total profit presented in the consolidated income statement to the income tax expenses is listed below: | ||||
| 2022 | 2021 | |||
| Total profit | 899,566,225 | 556,471,446 | ||
| Income tax calculated at applicable tax rates | 120,419,762 | (149,370,177) | ||
| Effect of change in the tax rates | 123,447,198 | 46,112,633 | ||
| Additional deductions | (230,686,396) | (166,139,453) | ||
| Deductive loss and temporary differences of the unrecognised deferred tax asset in the current period | 23,495,176 | 206,931,524 | ||
| Tax deduction | (1,487,861) | - | ||
| Non-deductible investment losses | 1,315,266 | 3,221,355 | ||
| Debt exemption between parent and subsidiary | - | 41,735,873 | ||
| Costs, expenses and losses not deductible for tax purposes | 184,461 | 16,317,418 | ||
| Utilisation of the deductible loss and temporary differences of the unrecognised deferred tax asset in the previous period | - | (16,503,671) | ||
| Income tax expenses | 36,687,606 | (17,694,498) | ||
| (55) | Earnings per share | |||
| (a) | Basic earnings per share | |||
| Basic earnings per share are calculated by dividing consolidated net profit attributable to ordinary shareholders of the parent company by the weighted average number of outstanding ordinary shares of the parent company: | ||||
| 2022 | 2021 | |||
| Consolidated net profit attributable to ordinary shareholders of the parent company | 915,049,168 | 574,165,944 | ||
| Weighted average number of ordinary shares outstanding issued by the Company | 863,214,000 | 863,214,000 | ||
| Basic earnings per share | 1.06 | 0.67 | ||
| (b) | Diluted earnings per share are calculated by dividing consolidated net profit attributable to ordinary shareholders of the parent company adjusted based on the dilutive potential ordinary shares by the adjusted weighted average number of outstanding ordinary shares of the Company. As there were no dilutive potential ordinary shares in 2022 (2021: Nil), diluted earnings per share equalled to basic earnings per share. | |||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) | |||
| (56) | Notes to the cash flow statement | |||
| (a) | Cash received relating to other operating activities | |||
| 2022 | 2021 | |||
| Government grants | 955,101,654 | 551,961,290 | ||
| Guarantees for bidding | 33,371,024 | 39,786,000 | ||
| Guarantees from distributors | 27,191,136 | 113,421,092 | ||
| Others | 33,097,597 | 31,612,504 | ||
| 1,048,761,411 | 736,780,886 | |||
| (b) | Cash paid relating to other operating activities | |||
| 2022 | 2021 | |||
| Research and development expenses | 816,368,325 | 738,436,009 | ||
| Promotion expenses | 476,208,872 | 374,879,458 | ||
| Warranties | 394,991,987 | 432,219,371 | ||
| Advertising expenses | 173,112,926 | 222,689,351 | ||
| Maintenance expenses | 83,223,085 | 129,000,432 | ||
| Guarantees | 78,907,867 | 123,112,381 | ||
| Trademark royalties | 64,658,976 | 37,289,547 | ||
| Consulting Fees | 55,227,003 | 75,454,111 | ||
| Others | 533,553,375 | 779,496,512 | ||
| 2,676,252,416 | 2,912,577,172 | |||
| (c) | Cash received relating to other investing activities | |||
| 2022 | 2021 | |||
| Interest from cash at bank | 213,506,326 | 262,810,420 | ||
| Other interest | 17,774,117 | 15,893,796 | ||
| 231,280,443 | 278,704,216 | |||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) |
| (56) | Notes to the cash flow statement (Cont’d) |
| (d) | Cash paid relating to other financing activities |
| 2022 | 2021 | |||
| Payments of lease liabilities | 18,852,333 | 14,398,829 | ||
| Others | 127,976 | 1,664,464 | ||
| 18,980,309 | 16,063,293 | |||
| (57) | Supplementary information to the cash flow statement | |||
| (a) | Supplementary information to the cash flow statement | |||
| Reconciliation from net profit to cash flows from operating activities | ||||
| 2022 | 2021 | |||
| Net profit | 862,878,619 | 574,165,944 | ||
| Add: Provision for asset impairment (Note 4(46)) | 7,242,768 | 43,273,452 | ||
| Provision for credit impairment (Note 4(47)) | 12,066,846 | (14,328,162) | ||
| Depreciation of fixed assets (Note 4(14)) | 906,176,838 | 887,989,750 | ||
| Amortisation of intangible assets (Note 4(17)) | 199,424,503 | 160,287,903 | ||
| Depreciation of right-of-use assets (Note 4(16)) | 70,119,650 | 41,536,327 | ||
| Increase in provisions (Note 4(30)) | 36,427,494 | 49,934,971 | ||
| Gains on disposal of long-term assets | (389,251,475) | (5,107,814) | ||
| Financial expenses | (164,683,747) | (275,191,314) | ||
| Investment income (Note 4(49)) | 36,082,647 | 568,716 | ||
| (Gains)/Losses on changes in fair value (Note 4(50)) | (13,434,988) | 10,638,548 | ||
| Increase in deferred tax assets | (18,386,505) | (85,151,198) | ||
| Decrease in deferred tax liabilities | (695,186) | (102,994,619) | ||
| Increase in inventories | (324,847,715) | (134,813,338) | ||
| (Increase)/Decrease in operating receivables | (2,216,547,690) | 196,013,053 | ||
| (Decrease)/Increase in operating payables | (521,146,011) | 413,370,791 | ||
| Net cash flows from operating activities | (1,518,573,952) | 1,760,193,010 | ||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 4 | Notes to the consolidated financial statements (Cont’d) |
| (57) | Supplementary information to the cash flow statement (Cont’d) |
| (a) | Supplementary information to the cash flow statement (Cont’d) |
| Net increase/(decrease) in cash and cash equivalents | ||||
| 2022 | 2021 | |||
| Cash and cash equivalents at the end of the year | 8,543,193,654 | 9,569,051,314 | ||
| Less: Cash and cash equivalents at the beginning of the year | (9,569,051,314) | (11,121,955,129) | ||
| Net decrease in cash and cash equivalents | (1,025,857,660) | (1,552,903,815) | ||
| (b) | Cash and cash equivalents | |||
| 31 December 2022 | 31 December 2021 | |||
| Cash at bank available for payment at any time | 7,656,947,735 | 8,509,470,334 | ||
| Cash at finance company available for payment at any time | 886,245,919 | 1,059,580,980 | ||
| 8,543,193,654 | 9,569,051,314 | |||
| (58) | Foreign currency monetary items | |||||
| 31 December 2022 | ||||||
| Amounts in foreign currencies | Translation exchange rate | Amounts in RMB | ||||
| Long-term borrowings - | ||||||
| USD | 327,421 | 6.9646 | 2,280,355 | |||
| Other payables - | ||||||
| USD | 36,364,457 | 6.9646 | 253,263,898 | |||
| EUR | 33,288 | 7.4229 | 247,094 | |||
| 253,510,992 | ||||||
SUPPLEMENTARY INFORMATION TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 5 | Equity in other entities | ||||||
| (1) | Equity in subsidiaries | ||||||
| Structure of the Group | |||||||
| Subsidiaries | Main place of business | Place of registration | Nature of business | Shareholding (%) | Method of acquisition | ||
| Direct | Indirect | ||||||
| JMCS | Nanchang, Jiangxi | Nanchang, Jiangxi | Retail, wholesale and lease of automobiles | 100% | - | Set up by investment | |
| JMCH (i) | Taiyuan, Shanxi | Taiyuan, Shanxi | Manufacture and sales of automobiles | 100% | - | Business combinations involving enterprises not under common control | |
| SZFJ | Shenzhen, Guangdong | Shenzhen, Guangdong | Retail, wholesale and lease of automobiles | 100% | - | Set up by investment | |
| GZFJ | Guangzhou, Guangdong | Guangzhou, Guangdong | Retail, wholesale and lease of automobiles | 100% | - | Set up by investment | |
| Jiangling Ford (Shanghai)(a) | Shanghai | Shanghai | Sales of automobiles, technical and business information consultation | 51% | - | Set up by investment | |
| (i) According to the resolution of Board of Directors held from 30 April 2021 to 6 May 2021, the Company sold 100% equity of JMCH held by the Company through Shanxi Property Rights Exchange at a price of not less than RMB764,069,207. On 9 August 2021, the listing announcement period has expired and Volvo Lastvagnar Aktiebolag(“Volvo”) became the intended transferee for the equity transaction. On 23 August 2021, the Company and Volvo reached an agreement through negotiation and signed the Equity Transaction Agreement on 100% Equity of Jiangling Heavy Duty Truck Co., Ltd. The benchmark price for equity transfer is RMB781,400,000. As at 31 December 2022, the equity transaction has not yet been completed because the review process by the relevant state authorities is under approval, so JMCH remains as a subsidiary of the Company and is included in the consolidated financial statements. | |||||||
SUPPLEMENTARY INFORMATION TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 5 | Interests in other entities (Cont’d) | |||||||
| (1) | Equity in subsidiaries (Cont’d) | |||||||
| (a) | Subsidiaries with significant minority interests | |||||||
| Subsidiaries | Shareholding of minority shareholders | Total profit or loss attributable to minority shareholders for the year ended 31 December 2022 | Dividends paid to minority shareholders for the year ended 31 December 2022 (i) | Minority interests as at 31 December 2022 | ||||
| Jiangling Ford (Shanghai) | 49% | (52,170,549) | - | (3,170,549) | ||||
| Key financial information of the above significant non-wholly owned subsidiaries is presented below. | ||||||||||||
| As at December 31 2022 | ||||||||||||
| Current assets | Non-current assets | Total assets | Current liabities | Non-current liabities | Total liabities | |||||||
| Jiangling Ford (Shanghai) | 348,631,416 | 94,602,499 | 443,233,915 | 449,704,423 | - | 449,704,423 | ||||||
| 2022 | ||||||||
| Revenue | Net profit | Total comprehensive income | Cash flows from operating activities | |||||
| Jiangling Ford (Shanghai) | 124,029,583 | (106,470,508) | (106,470,508) | ((20,888,628) | ||||
| As of December 31 2022, Jiangling Ford (Shanghai) is operating. The Company and Ford have paidRMB51,000,000 and RMB49,000,000 respectively. As of February 28 2023, the Company and Ford had fully paid-in capital. | ||||||||
SUPPLEMENTARY INFORMATION TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 5 | Interests in other entities (Cont’d) |
| (2) | Equity in associates |
| (a) | General information of significant associates |
| Place of registration | Shareholding (%) | ||||||
| Direct | Indirect | ||||||
| Associate - | |||||||
| The Power Company | Taiyuan, Shanxi | 40% | - | ||||
| (b) | Summarised financial information for significant associates | ||||||
| 31 December 2022 | 31 December 2021 | |||
| The Power Company | The Power Company | |||
| Current assets | 194,926,320 | 153,906,457 | ||
| Non-current assets | 426,146,460 | 421,186,131 | ||
| Total assets | 621,072,780 | 575,092,588 | ||
| Current liabilities | 107,387,068 | 35,108,575 | ||
| Non-current liabilities | 152,778 | - | ||
| Total liabilities | 107,539,846 | 35,108,575 | ||
| Minority interests | 205,413,174 | 215,993,605 | ||
| Attributable to shareholders of the parent company | 308,119,760 | 323,990,408 | ||
| Share of net assets based on shareholding (i) | 205,413,174 | 215,993,605 | ||
| Adjustments | ||||
| - Unrealised profits arising from internal transactions | (15,210,808) | (16,004,313) | ||
| - Others (ii) | 20,853,323 | 20,853,323 | ||
| Carrying amount of equity investments in associates | 211,055,689 | 220,842,615 | ||
SUPPLEMENTARY INFORMATION TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 6 | Equity in other entities (Cont’d) | ||||
| (2) | Equity in associates (Cont’d) | ||||
| (b) | Summarised financial information for significant associates (Cont’d) | ||||
| 2022 | From 5 November 2021 (date of the equity delivery) to 31 December 2021 | ||||
| The Power Company | The Power Company | ||||
| Revenue | 92,711,191 | 4,211,261 | |||
| Net loss | (26,440,535) | (7,882,680) | |||
| Other comprehensive income | - | - | |||
| Total comprehensive loss | (26,440,535) | (7,882,680) | |||
| Dividends received from associates by the Group | - | - | |||
| (i) | The Group calculated the shares of net assets in proportion of the shareholdings and based on the amount attributable to the parent company of the associates in their consolidated financial statements. The amount in the consolidated financial statements of associates considers the impacts of fair value of identifiable assets and liabilities of associates at the time of acquisition and the unification of accounting policies. None of the assets involved in transactions between the Group and associates contribute to business. | ||||
| (ii) | Other adjustments were mainly the remeasurement for fair value of remaining equity in the consolidated financial statements, which resulted from the loss of control over the original subsidiary due to the disposal of part of the equity investment. | ||||
| (c) | Summarised information of insignificant associates | |||
| 2022 | 2021 | |||
| Aggregated carrying amount of investments | 37,427,133 | 36,408,640 | ||
| Aggregate of the following items in proportion | ||||
| Net profit/(loss) (i) | 1,018,493 | (3,087,908) | ||
| Other comprehensive income (i) | - | - | ||
| Total comprehensive income/(loss) | 1,018,493 | (3,087,908) | ||
| (i) | Net profit and other comprehensive income have taken into account the fair value of identifiable assets and liabilities at the time of acquisition of the investments and the impact of adjustments to uniform accounting policies. |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022
(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 6 | Segment information | |||||
| Revenue and profits of the Company mainly arise from production and domestic sales of automobiles, and the primary assets of the Group are all located in China. Management of the Group assesses the operating performance of the Group as a whole. Therefore, no segment report is prepared for the current year. During 2022, the operating revenue obtained from a single customer of the Group accounted for more than 10% of the Group's operating revenue (2021: Nil), amounting to RMB5,907,094,789, or 19.62% of the Group's operating revenue. | ||||||
| 7 | Related parties and related party transactions | |||||
| (1) | Information of major shareholders | |||||
| (a) | General information of major shareholders | |||||
| Type of enterprise | Place of registration | Legal representative | Nature of business | Code of organisation | ||
| JIC | State-owned enterprise | Nanchang, China | Qiu Tiangao | Investment and asset management | 91360125MA38LUR91F | |
| Ford | Foreign enterprise | United States | William Clay Ford, Jr. | Manufacture and sales of automobiles | N/A | |
| (b) | Registered capital and changes in major shareholders | |||||
| 31 December 2021 | Increase in the current year | Decrease in the current year | 31 December 2022 | ||||||
| JIC | 1,000,000,000 | - | - | 1,000,000,000 | |||||
| Ford | USD 41,000,000 | USD 1,000,000 | - | USD 42,000,000 | |||||
| (c) | The percentages of shareholding and voting rights in the Company held by major shareholders | ||||||||
| 31 December 2022 | 31 December 2021 | ||||||||
| Shareholding | Voting rights | Shareholding | Voting rights | ||||||
| JIC | 41.03% | 41.03% | 41.03% | 41.03% | |||||
| Ford | 32% | 32% | 32% | 32% | |||||
| (2) | Information of subsidiaries |
| The general information and other related information of subsidiaries are set out in Note 5(1). | |
| (3) | Information of associates |
| The information of associates is set out in Note 4(13). | |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 7 | Related parties and related party transactions (Cont'd) | |
| (4) | Information of other related parties | |
| Relationship with the Group | ||
| JMCG | Shareholder of JIC | |
| Chongqing Changan Automobile Co., Ltd. | Shareholder of JIC | |
| Jiangxi JMCG Industry Co., Ltd. | Wholly-owned subsidiary of JMCG | |
| Jiangxi Lingrui Recycling Resources Development Corporation | Wholly-owned subsidiary of JMCG | |
| Jiangling Material Co., Ltd. | Wholly-owned subsidiary of JMCG | |
| JMCG Property Management Co. | Wholly-owned subsidiary of JMCG | |
| JMCG Jingma Motors Co., Ltd. | Wholly-owned subsidiary of JMCG | |
| Jiangxi Jiangling Special Purpose Vehicle Co., Ltd. | Wholly-owned subsidiary of JMCG | |
| JMCF | Holding subsidiary of JMCG | |
| Jiangxi Jiangling Chassis Co., Ltd. | Holding subsidiary of JMCG | |
| Nanchang JMCG Xinchen Auto Component Co., Ltd. | Holding subsidiary of JMCG | |
| Nanchang JMCG Shishun Logistics Co., Ltd. | Holding subsidiary of JMCG | |
| Jiangxi Lingge Non-ferrous Metal Die-casting Co., Ltd. | Holding subsidiary of JMCG | |
| Jiangxi Mingfang Auto Parts Industry Co., Ltd. | Holding subsidiary of JMCG | |
| Jiangxi Jiangling group Fuxin Auto Parts Co., Ltd. | Holding subsidiary of JMCG | |
| Ford Motor Research & Engineering (Nanjing) Co., Ltd. | Wholly-owned subsidiary of Ford | |
| Ford Global Technologies,LLC | Wholly-owned subsidiary of Ford | |
| Ford Motor Co. Thailand Ltd. | Wholly-owned subsidiary of Ford | |
| Ford Motor (China) Co., Ltd. | Wholly-owned subsidiary of Ford | |
| Ford Trading Company, LLC | Wholly-owned subsidiary of Ford | |
| Ford Vietnam Limited | Holding subsidiary of Ford | |
| Auto Alliance (Thailand) Co., Ltd. | Holding subsidiary of Ford | |
| Ford Otomotiv Sanayi A.S. | Holding subsidiary of Ford | |
| Changan Ford Automobile Co., Ltd. | Joint venture of Ford | |
| JMCG Jiangxi Engineering Construction Co., Ltd. | Subsidiary under indirect control of JMCG | |
| Nanchang JMCG Liancheng Auto Component Co., Ltd. | Subsidiary under indirect control of JMCG | |
| Jiangling Aowei Automobile Spare Part Co., Ltd. | Subsidiary under indirect control of JMCG | |
| Nanchang Lianda Machinery Co., Ltd. | Subsidiary under indirect control of JMCG | |
| Nanchang JMCG Frame Co., Ltd | Subsidiary under indirect control of JMCG | |
| Nanchang Gear Forging Co.,Ltd.(i) | Subsidiary under indirect control of JMCG | |
| Jiangxi JMCG Boya brake system Co., Ltd. | Subsidiary under indirect control of JMCG | |
| China Changan Group Tianjin Sales Co., Ltd. | Group subsidiary of JIC’s shareholder | |
| Dali Wanfu Vehicle Sales & Service Co., Ltd. | Group subsidiary of JIC’s shareholder | |
| Chongqing Anfu Vehicle Marketing Co., Ltd. | Group subsidiary of JIC’s shareholder | |
| Chengdu Wanxing Vehicle Sales & Service Co., Ltd. | Group subsidiary of JIC’s shareholder | |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 7 | Related parties and related party transactions (Cont'd) |
| (4) | Information of other related parties (Cont'd) |
| Relationship with the Group | ||
| Chongqing Anbo Vehicle Sales Co., Ltd. | Group subsidiary of JIC’s shareholder | |
| Guizhou Wanfu Vehicle Sales & Service Co., Ltd. | Group subsidiary of JIC’s shareholder | |
| Beijing Baiwang Changfu Vehicle Sales & Service Co., Ltd. | Group subsidiary of JIC’s shareholder | |
| Beijing Beifang Changfu Vehicle Sales & Service Co., Ltd. | Group subsidiary of JIC’s shareholder | |
| Guizhou Wanjia Automobile Sales and Service Co. LTD | Group subsidiary of JIC’s shareholder | |
| Jiangxi Jiangling Lear Interior System Co., Ltd. | Joint venture of JMCG | |
| Nanchang Jiangling HuaXiang Auto Components Co., Ltd. | Joint venture of JMCG | |
| Nanchang Unistar Electric & Electronics Co., Ltd. | Joint venture of JMCG | |
| Nanchang Yinlun Heat-exchanger Co., Ltd. | Joint venture of JMCG | |
| Jiangxi ISUZU Engine Co., Ltd. | Joint venture of JMCG | |
| Jiangxi ISUZU Co., Ltd. | Joint venture of JMCG | |
| Dibao transportation equipment (Nanchang) Co., Ltd | Joint venture of JMCG | |
| Jiangxi JMCG Specialty Vehicles Co., Ltd. | Associate of JMCG | |
| Jiangling Motor Holdings Co., Ltd. | Associate of JMCG | |
| Magna PT Powertrain (Jiangxi) Co., Ltd. | Associate of JMCG | |
| Nanchang Baojiang Steel Processing Distribution Co., Ltd. | Associate of JMCG | |
| Jiangxi JMCG Motorhome Co.,Ltd. | Associate of JMCG | |
| Faurecia Emissions Control Technologies (Nanchang) Co., Ltd. | Associate of JMCG | |
| Nanchang Hengou Industry Co., Ltd. | Associate of JMCG | |
| Jiangxi Jiangling Group Special Vehicle Co., Ltd. | Associate of JMCG | |
| Jiangling Motor Electricity Vehicle Co., Ltd. | Associate of JMCG | |
| Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. | Associate of JMCG | |
| Jiangxi JMCG Specialty Vehicles Sales Corporation, Ltd. | Associate of JMCG | |
| Nanchang JMCG SMR Huaxiang Mirror Co., Ltd. | Associate of JMCG | |
| Jiangxi Lingyun Automobile Industry Technology Co.,Ltd | Associate of JMCG | |
| Jiujiang Fuwantong Vehicle Co., Ltd. | Associate of JMCG | |
| Jiangxi Zhonglian Intelligent Logistics Co., Ltd. | Associate of JMCG | |
| (i) In March 2022, NC.Gear Forging Factory was renamed to Nanchang Gear Forging Co.,Ltd. | ||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 7 | Related parties and related party transactions (Cont'd) | ||||
| (5) | Related party transactions | ||||
| (a) | Purchase and sales of goods, provision and receipt of services | ||||
| Purchase of goods: | |||||
| Related parties | Nature of related party transactions | 2022 | 2021 | ||
| Nanchang Jiangling HuaXiang Auto Components Co., Ltd. | Purchase of automobile parts | 924,968,624 | 772,387,021 | ||
| Magna PT Powertrain (Jiangxi) Co., Ltd. | Purchase of automobile parts | 893,746,762 | 787,759,240 | ||
| Nanchang Baojiang Steel Processing Distribution Co., Ltd. | Purchase of raw materials | 853,482,030 | 967,549,307 | ||
| Jiangxi Jiangling Chassis Co., Ltd. | Purchase of automobile parts | 667,746,553 | 898,433,987 | ||
| Jiangxi Jiangling Lear Interior System Co., Ltd. | Purchase of automobile parts | 592,001,464 | 513,132,683 | ||
| Jiangxi Zhonglian Intelligent Logistics Co., Ltd. | Purchase of automobile parts | 591,833,347 | 470,431,786 | ||
| Jiangxi Jiangling Special Purpose Vehicle Co., Ltd. | Purchase of automobile parts | 522,742,154 | 985,020,418 | ||
| Faurecia Emissions Control Technologies (Nanchang) Co., Ltd. | Purchase of automobile parts | 463,742,380 | 477,760,140 | ||
| Nanchang JMCG Liancheng Auto Component Co., Ltd. | Purchase of automobile parts | 369,597,043 | 416,531,044 | ||
| Nanchang Unistar Electric & Electronics Co., Ltd. | Purchase of automobile parts | 324,877,090 | 344,122,534 | ||
| Ford | Purchase of automobile parts | 322,131,155 | 627,489,896 | ||
| Nanchang JMCG Shishun Logistics Co., Ltd. | Purchase of automobile parts | 180,558,765 | 366,945,009 | ||
| Hanon Systems | Purchase of automobile parts | 158,047,018 | 213,213,340 | ||
| Jiangxi Lingyun Automobile Industry Technology Co., Ltd. | Purchase of automobile parts | 103,896,591 | 37,844,846 | ||
| Nanchang Yinlun Heat-exchanger Co., Ltd. | Purchase of automobile parts | 102,105,085 | 112,831,150 | ||
| Nanchang JMCG SMR Huaxiang Mirror Co., Ltd. | Purchase of automobile parts | 101,065,187 | 105,244,091 | ||
| JMCG | Purchase of automobile parts | 88,653,236 | 179,153,533 | ||
| Jiangxi Lingge Non-ferrous Metal Die-casting Co., Ltd. | Purchase of automobile parts | 77,843,750 | 90,812,109 | ||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 7 | Related parties and related party transactions (Cont'd) | ||||
| (5) | Related party transactions (Cont’d) | ||||
| (a) | Purchase and sales of goods, provision and receipt of services (Cont'd) | ||||
| Purchase of goods (Cont'd): | |||||
| Related parties | Nature of related party transactions | 2022 | 2021 | ||
| Dibao transportation equipment (Nanchang) Co., Ltd. | Purchase of automobile parts | 72,666,598 | 92,353,687 | ||
| Nanchang Lianda Machinery Co., Ltd. | Purchase of automobile parts | 41,535,015 | 72,039,671 | ||
| Changan Ford Automobile Co., Ltd. | Purchase of automobile parts | 41,230,580 | 48,145,204 | ||
| Jiangxi Jiangling Group Special Vehicle Co., Ltd. | Purchase of automobile parts | 35,235,246 | 33,875,299 | ||
| Auto Alliance (Thailand) Company Limited | Purchase of automobile parts | 32,471,122 | 45,310,450 | ||
| Jiangling Material Co., Ltd. | Purchase of raw materials | 32,216,397 | 32,138,057 | ||
| Jiangxi JMCG Specialty Vehicles Co., Ltd. | Purchase of automobile parts | 28,779,924 | 41,659,140 | ||
| Jiangxi Lingrui Recycling Resources Development Corporation | Purchase of automobile parts | 21,762,663 | 8,484,962 | ||
| Jiangxi JMCG Boya brake system Co., Ltd. | Purchase of automobile parts | 19,380,235 | 30,510,070 | ||
| Jiangling Motor Holdings Co., Ltd. | Purchase of automobile parts | 17,697,962 | 43,636,191 | ||
| Jiangxi ISUZU Engine Co., Ltd. | Purchase of automobile parts | 15,633,287 | 20,171,236 | ||
| The Power Company | Purchase of automobile parts | 12,857,369 | 873,543 | ||
| Ford Otomotiv Sanayi A.S. | Purchase of automobile parts | 11,853,176 | 22,119,616 | ||
| Jiangxi Jiangling group Fuxin Auto Parts Co., Ltd. | Purchase of automobile parts | 11,199,030 | 14,081,765 | ||
| Jiangling Aowei Automobile Spare Part Co., Ltd. | Purchase of automobile parts | 10,490,081 | 18,664,870 | ||
| Nanchang JMCG Xinchen Auto Component Co., Ltd. | Purchase of automobile parts | 6,378,562 | 14,697,466 | ||
| Jiangxi Mingfang Auto Parts Industry Co., Ltd. | Purchase of automobile parts | 5,568,158 | 3,510,953 | ||
| Nanchang Hengou Industry Co., Ltd. | Purchase of automobile parts | 3,423,048 | 3,105,865 | ||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 7 | Related parties and related party transactions (Cont'd) | ||||
| (5) | Related party transactions (Cont’d) | ||||
| (a) | Purchase and sales of goods, provision and receipt of services (Cont'd) | ||||
| Purchase of goods (Cont'd): | |||||
| Related parties | Nature of related party transactions | 2022 | 2021 | ||
| Ford Motor Co. Thailand Ltd. | Purchase of automobile parts | 3,277,641 | 3,939,065 | ||
| Nanchang Gear Forging Co.,Ltd. | Purchase of automobile parts | 3,004,555 | 9,391,656 | ||
| Jiangxi JMCG Industry Co., Ltd. | Purchase of automobile parts | 174,875 | 10,268,410 | ||
| Other related parties | Purchase of automobile parts | 1,927,294 | 3,146,015 | ||
| 7,767,801,052 | 8,938,785,325 | ||||
| The products purchased by the Group from related parties are divided into two categories: purchase of imported parts and purchase of domestic parts. ? The pricing on imported parts purchased from Ford or its suppliers is based on the agreed price by both parties; ? The pricing on domestic accessories purchased from other related parties is determined through quotation, cost accounting, and negotiation between the two parties, and is adjusted regularly. |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022
(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 7 | Related parties and related party transactions (Cont'd) | ||||
| (5) | Related party transactions (Cont’d) | ||||
| (a) | Purchase and sales of goods, provision and receipt of services (Cont'd) | ||||
| Receipt of services: | |||||
| Related parties | Nature of related party transactions | 2022 | 2021 | ||
| Nanchang JMCG Shishun Logistics Co., Ltd. | Transportation, removal fee, etc. | 298,629,305 | 308,005,709 | ||
| Ford Global Technologies, LLC | Trademark management fees, technology development | 246,334,027 | 278,546,988 | ||
| Ford | Technical services and personnel costs | 204,118,407 | 110,282,579 | ||
| Jiangxi Zhonglian Intelligent Logistics Co., Ltd. | Cartage fee, storage fee, etc. | 30,384,153 | 12,343,777 | ||
| Jiangxi JMCG Industry Co., Ltd. | Meals | 24,868,735 | 22,676,641 | ||
| Ford Motor (China) Co., Ltd. | Personnel costs, etc. | 21,474,039 | 16,127,484 | ||
| Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. | Agency fee, advertising fee, etc. | 15,899,222 | 9,680,267 | ||
| Ford Otomotiv Sanayi A.S. | Technical services and technical development | 15,125,422 | 18,265,089 | ||
| Ford Motor Research & Engineering (Nanjing) Co., Ltd. | Personnel costs | 14,496,038 | 9,082,057 | ||
| Changan Ford Automobile Co., Ltd. | Service fee, labour costs, etc. | 8,263,784 | 21,913,168 | ||
| JMCG Property Management Co., Ltd. | Property fees, etc. | 4,362,127 | 3,352,585 | ||
| The Power Company | Consulting | 4,109,652 | - | ||
| Chongqing Changan Automobile Co., Ltd. | Personnel costs | 2,458,047 | 1,680,278 | ||
| Jiangling Motor Holdings Co., Ltd. | Labour fee, rental fee | 2,021,395 | 10,097,592 | ||
| JMCG | Labour fee, rental fee, etc. | 1,492,519 | 1,403,765 | ||
| Jiangxi Jiangling Group Special Vehicle Co., Ltd. | Promotion | 1,482,872 | 183,420 | ||
| Guizhou Wanfu Vehicle Sales & Service Co., Ltd. | Warranty and promotion | 1,276,480 | 1,022,766 | ||
| Chengdu Wanxing Vehicle Sales & Service Co., Ltd. | Warranty and promotion | 1,203,126 | 608,540 | ||
| China Changan Group Tianjin Sales Co., Ltd. | Warranty and promotion | 1,202,470 | 19,975 | ||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022
(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 7 | Related parties and related party transactions (Cont'd) | ||||
| (5) | Related party transactions (Cont’d) | ||||
| (a) | Purchase and sales of goods, provision and receipt of services (Cont'd) | ||||
| Receipt of services (Cont’d): | |||||
| Related parties | Nature of related party transactions | 2022 | 2021 | ||
| Chongqing Anfu Vehicle Marketing Co., Ltd. | Warranty and promotion | 1,168,824 | 1,153,740 | ||
| Jiangxi JMCG Specialty Vehicles Co., Ltd. | Promotion | 1,143,651 | 1,509,221 | ||
| JMCG Jiangxi Engineering Construction Co., Ltd. | Engineering construction | - | 202,783,377 | ||
| Magna PT Powertrain (Jiangxi) Co., Ltd. | Design fee, experimental costs | - | 2,440,812 | ||
| Nanchang Jiangling HuaXiang Auto Components Co., Ltd. | Design fee, experimental costs | - | 2,175,305 | ||
| Other related parties | 5,100,616 | 8,946,739 | |||
| 906,614,911 | 1,044,301,874 | ||||
| The Group’s pricing on services received from related parties is based on the agreed price by both parties. | |||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 7 | Related parties and related party transactions (Cont'd) | ||||
| (5) | Related party transactions (Cont’d) | ||||
| (a) | Purchase and sales of goods, provision and receipt of services (Cont'd) | ||||
| Sales of goods and provision of services: | |||||
| Related parties | Nature of related party transactions | 2022 | 2021 | ||
| Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. | Sales of vehicles and accessories, etc. | 5,898,939,789 | 3,009,201,649 | ||
| Jiangxi JMCG Specialty Vehicles Sales Corporation, Ltd. | Sales of vehicles | 472,883,971 | 424,832,553 | ||
| Jiangxi Jiangling Special Purpose Vehicle Co., Ltd. | Sales of vehicles and accessories, etc. | 258,768,616 | 108,430,877 | ||
| Jiangxi JMCG Specialty Vehicles Co., Ltd. | Sales of vehicles and accessories | 104,259,399 | 61,352,599 | ||
| Jiangxi Jiangling Chassis Co., Ltd. | Sales of accessories | 74,175,180 | 71,371,856 | ||
| JMCG Jingma Motors Co., Ltd. | Sales of vehicles and accessories | 71,361,087 | 56,901,153 | ||
| Jiangxi Lingrui Recycling Resources Development Corporation | Sales of waste materials, etc. | 69,766,263 | 91,363,165 | ||
| Chongqing Anfu Vehicle Marketing Co., Ltd. | Sales of vehicles and accessories | 51,437,264 | 46,641,322 | ||
| Jiangxi Jiangling Group Special Vehicle Co., Ltd. | Sales of vehicles and accessories | 51,205,027 | 53,876,378 | ||
| Chengdu Wanxing Vehicle Sales & Service Co., Ltd. | Sales of vehicles and accessories | 48,716,119 | 47,840,275 | ||
| Guizhou Wanfu Vehicle Sales & Service Co., Ltd. | Sales of vehicles and accessories | 47,550,057 | 45,806,320 | ||
| China Changan Group Tianjin Sales Co., Ltd. | Sales of vehicles and accessories | 45,104,628 | 26,458,070 | ||
| Dali Wanfu Vehicle Sales & Service Co., Ltd. | Sales of vehicles and accessories | 41,230,522 | 39,401,634 | ||
| Chongqing Anbo Vehicle Sales Co., Ltd. | Sales of vehicles and accessories | 27,134,967 | 37,899,577 | ||
| Jiangxi ISUZU Co., Ltd. | Sales of accessories | 21,171,806 | 2,910,489 | ||
| Beijing Beifang Changfu Vehicle Sales & Service Co., Ltd. | Sales of vehicles and accessories | 17,459,735 | 12,749,059 | ||
| Jiangxi Jiangling Lear Interior System Co., Ltd. | Sales of accessories | 13,331,531 | 5,759,013 | ||
| Guizhou Wanjia Automobile Sales and Service Co. LTD | Sales of vehicles and accessories | 13,260,858 | 10,893,900 | ||
| Nanchang JMCG SMR Huaxiang Mirror Co., Ltd. | Sales of accessories | 12,877,775 | 10,779,022 | ||
| Nanchang Hengou Industry Co., Ltd. | Sales of accessories | 11,141,173 | 9,982,170 | ||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 7 | Related parties and related party transactions (Cont'd) | ||||
| (5) | Related party transactions (Cont’d) | ||||
| (a) | Purchase and sales of goods, provision and receipt of services (Cont'd) | ||||
| Sales of goods and provision of services(Cont'd): | |||||
| Related parties | Nature of related party transactions | 2022 | 2021 | ||
| Nanchang JMCG Liancheng Auto Component Co., Ltd. | Sales of accessories | 9,721,317 | 8,931,828 | ||
| Beijing Baiwang Changfu Vehicle Sales & Service Co., Ltd. | Sales of vehicles and accessories | 9,138,891 | 429,324 | ||
| Jiangxi Zhonglian Intelligent Logistics Co., Ltd. | Sales of accessories | 4,886,482 | 35,851,242 | ||
| JMCG | Sales of accessories and labor costs | 3,931,336 | 140,274 | ||
| Jiangxi JMCG Industry Co., Ltd. | Sales of accessories and waste materials, etc. | 3,496,119 | 3,129,560 | ||
| Nanchang JMCG Shishun Logistics Co., Ltd. | Sales of vehicles and accessories, etc | 3,351,832 | 12,470,469 | ||
| Nanchang Jiangling HuaXiang Auto Components Co., Ltd. | Sales of accessories | 3,317,971 | 3,382,979 | ||
| Nanchang Lianda Machinery Co., Ltd. | Sales of accessories | 1,964,144 | 2,332,429 | ||
| Jiangling Motor Holdings Co., Ltd. | Labor costs | 1,150,970 | - | ||
| Jiujiang Fuwantong Vehicle Co., Ltd. | Sales of vehicles and accessories | 648,584 | 7,122,010 | ||
| Other related parties | 3,731,023 | 8,196,693 | |||
| 7,397,114,436 | 4,256,437,889 | ||||
| The Group’s pricing on goods sold to related parties is based on the agreed price by both parties. |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022
(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 7 | Related parties and related party transactions (Cont'd) |
| (5) | Related party transactions (Cont’d) |
| (b) | Leases |
| (i) | The lease income recognised in the current year with the Group as the lessor: | ||||
| Name of the lessee | Type of the leased asset | 2022 | 2021 | ||
| Jiangling Motor Holdings Co., Ltd. | Buildings | 4,909 | - | ||
| Jiangxi JMCG Motorhome Co.,Ltd. | Buildings | 2,945 | - | ||
| Jiangling Material Co., Ltd. | Buildings | - | 60,550 | ||
| Jiangxi ISUZU Co., Ltd. | Buildings | - | 29,708 | ||
| 7,854 | 90,258 | ||||
| (ii) | Increase of right-of-use assets in the current year with the Group as the lessee | ||||
| Name of the lessor | Type of the leased asset | 2022 | 2021 | ||
| Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. | Buildings | - | 16,852,582 | ||
| JMCG | Buildings | - | 182,766 | ||
| - | 17,035,348 | ||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022
(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 7 | Related parties and related party transactions (Cont'd) |
| (5) | Related party transactions (Cont’d) |
| (b) | Leases (Cont'd) |
| (iii) | Interest expenses on lease liabilities in the current year with the Group as the lessee: | |||
| 2022 | 2021 | |||
| Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. | 549,276 | 538,978 | ||
| JMCG | 311,629 | 417,937 | ||
| 860,905 | 956,915 | |||
| (c) | Guarantee received | ||||
| Guarantor | Guaranteed amount | Starting date | Ending date | Fully performed or not | |
| JMCF | 2,280,355 | 5 March 2001 | 30 October 2029 | Not fully performed | |
| In 2022, JMCF provided guarantees for some bank borrowings of the Group, with a maximum guarantee limit of USD 2,282,123. As at 31 December 2022, JMCF provided borrowing guarantee to the bank borrowing of USD 327,421, equivalent to RMB2,280,355 (31 December 2021: USD 392,905, equivalent to RMB2,505,044) for the Group. |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 7 | Related parties and related party transactions (Cont'd) |
| (5) | Related party transactions (Cont’d) |
| (d) | Transfer of assets | ||||
| Related parties | Nature of related party transactions | 2022 | 2021 | ||
| JMCG Jingma Motors Co., Ltd. | Sales of fixed assets | 4,527,773 | - | ||
| Jiangxi Lingrui Recycling Resources Development Corporation | Sales of fixed assets | 249,367 | 19,069,865 | ||
| 4,777,140 | 19,069,865 | ||||
| The pricing on transfer of assets between the Group and related parties is based on the agreed price by both parties. | |||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 7 | Related parties and related party transactions (Cont'd) | ||||
| (5) | Related party transactions (Cont’d) | ||||
| (e) | Purchase of assets | ||||
| Related parties | Nature of related party transactions | 2022 | 2021 | ||
| Nanchang Jiangling HuaXiang Auto Components Co., Ltd. | Purchase of fixed assets | 30,269,160 | 444,600 | ||
| Jiangxi Jiangling Special Purpose Vehicle Co., Ltd. | Purchase of fixed assets | 19,523,883 | 4,946,744 | ||
| Nanchang JMCG Liancheng Auto Component Co., Ltd. | Purchase of fixed assets | 9,660,000 | - | ||
| Jiangxi JMCG Specialty Vehicles Co., Ltd. | Purchase of fixed assets | 456,637 | - | ||
| Magna PT Powertrain (Jiangxi) Co., Ltd. | Purchase of fixed assets | - | 2,480,000 | ||
| 59,909,680 | 7,871,344 | ||||
| The pricing on purchase of assets between the Group and related parties is based on the agreed price by both parties. | |||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 7 | Related parties and related party transactions (Cont'd) | ||||
| (5) | Related party transactions (Cont’d) | ||||
| (f) | Purchaseof long-term technology license | ||||
| Related parties | Nature of related party transactions | 2022 | 2021 | ||
| Ford | Purchaseof long-term technology license | 129,021,097 | - | ||
| Ford Otomotiv Sanayi A.S. | Purchaseof long-term technology license | 8,392,035 | - | ||
| 137,413,132 | - | ||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 7 (5) (g) | Related parties and related party transactions (Cont'd) Related party transactions (Cont’d) Provision of technology sharing and distribution service | ||||
| Related parties | Nature of related party transactions | 2022 | 2021 | ||
| Ford Motor Research & Engineering (Nanjing) Co., Ltd. | Engineering and technical service | 55,006,000 | 66,669,000 | ||
| Ford | Technical service | 18,690,000 | 12,450,000 | ||
| Ford Vietnam Limited | Technical service | 14,390,000 | 12,780,000 | ||
| Ford Motor (China) Co., Ltd. | Distribution Services | 12,978,451 | - | ||
| Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. | Technical service | 8,155,000 | 480,000 | ||
| Ford Trading Company, LLC | Technical service | 2,206,000 | 4,795,000 | ||
| Jiangxi ISUZU Co., Ltd. | Technical service | 710,000 | 6,390,000 | ||
| JMCG Jingma Motors Co., Ltd. | Technical service | 190,000 | - | ||
| Ford Otomotiv Sanayi A.S. | Technical service | - | 340,000 | ||
| 112,325,451 | 103,904,000 | ||||
| The Group’s pricing on technology sharing provided to related parties is based on the agreed price by both parties. | |||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 7 | Related parties and related party transactions (Cont'd) |
| (5) | Related party transactions (Cont’d) |
| (h) | Remuneration of key management | |||
| 2022 | 2021 | |||
| Remuneration of key management | 11,606,369 | 17,375,367 | ||
| (i) | Interest income | |||
| 2022 | 2021 | |||
| JMCF | 17,130,577 | 17,076,393 | ||
| Cash at bank of the Group deposited with JMCF was calculated based on the bank annual interest rate for RMBdeposit of 1.725% to 2.25% over the same period (2021: 1.725% to 2.25%). | ||||
| (j) | Interest expenses | |||
| 2022 | 2021 | |||
| JMCF | 1,250,000 | - | ||
| Jiangxi Zhonglian Intelligent Logistics Co., Ltd. | - | 120,000 | ||
| Nanchang JMCG Shishun Logistics Co., Ltd. | - | 30,000 | ||
| 1,250,000 | 150,000 | |||
| (k) | Purchase of CAFC credit and NEV credit | |||
| 2022 | 2021 | |||
| Jiangling Motor Electricity Vehicle Co., Ltd. | 64,474,060 | 11,186,318 | ||
| Jiangling Motor Holdings Co., Ltd. | 819,000 | 177,528,302 | ||
| 65,293,060 | 188,714,620 | |||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022
(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 7 | Related parties and related party transactions (Cont'd) | |||||||
| (6) | Receivables from and payables to related parties | |||||||
| 31 December 2022 | 31 December 2021 | |||||||
| Amount | Provision for bad debts | Amount | Provision for bad debts | |||||
| Accounts receivable | ||||||||
| Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. | 1,809,124,109 | (1,495,512) | 1,055,206,739 | (2,469,956) | ||||
| Jiangxi Jiangling Special Purpose Vehicle Co., Ltd. | 105,372,893 | (963,329) | 4,511,078 | (7,003) | ||||
| Jiangxi JMCG Specialty Vehicles Sales Corporation, Ltd. | 60,082,649 | (329,953) | 70,709,214 | (56,476) | ||||
| JMCG Jingma Motors Co., Ltd. | 46,820,892 | (140,841) | 16,858,567 | (59,595) | ||||
| Ford Motor Research & Engineering (Nanjing) Co., Ltd. | 21,973,800 | (65,921) | - | - | ||||
| Jiangxi JMCG Specialty Vehicles Co., Ltd. | 9,109,228 | (5,477) | 10,889,510 | (9,689) | ||||
| Jiangxi ISUZU Co., Ltd. | 3,650,860 | (10,953) | 534,623 | (1,890) | ||||
| Jiangxi Jiangling Lear Interior System Co., Ltd. | 3,326,672 | (9,980) | 1,430,746 | (5,058) | ||||
| Ford Vietnam Limited | 3,250,000 | (9,750) | - | - | ||||
| Nanchang JMCG Liancheng Auto Component Co., Ltd. | 1,773,035 | (5,319) | 1,655,446 | (5,852) | ||||
| Nanchang JMCG Shishun Logistics Co., Ltd. | 1,735,793 | (744) | - | - | ||||
| Ford Motor (China) Co., Ltd. | 1,727,858 | (5,184) | - | - | ||||
| Jiangxi Zhonglian Intelligent Logistics Co., Ltd. | 1,340,748 | (4,022) | 4,113,754 | (14,542) | ||||
| Nanchang JMCG SMR Huaxiang Mirror Co., Ltd. | - | - | 3,253,009 | (11,499) | ||||
| Other related parties | 3,899,861 | (10,790) | 5,139,610 | (18,170) | ||||
| 2,073,188,398 | (3,057,775) | 1,174,302,296 | (2,659,730) | |||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 7 | Related parties and related party transactions (Cont'd) | |||||||
| (6) | Receivables from and payables to related parties (Cont’d) | |||||||
| 31 December 2022 | 31 December 2021 | |||||||
| Amount | Provision for bad debts | Amount | Provision for bad debts | |||||
| Other receivables | ||||||||
| Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. | 10,231,067 | (30,693) | 25,000,000 | (75,000) | ||||
| JMCG Jingma Motors Co., Ltd. | 4,614,745 | (13,844) | - | - | ||||
| Jiangling Motor Electricity Vehicle Co., Ltd. | - | - | 31,266,512 | (93,800) | ||||
| Jiangxi Lingrui Recycling Resources Development Corporation | - | - | 17,668,457 | (53,005) | ||||
| Other related parties | 4,000 | (12) | 121,141 | (364) | ||||
| 14,849,812 | (44,549) | 74,056,110 | (222,169) | |||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022
(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 7 | Related parties and related party transactions (Cont'd) | ||||
| (6) | Receivables from and payables to related parties (Cont’d) | ||||
| 31 December 2022 | 31 December 2021 | ||||
| Advances to suppliers | Nanchang Baojiang Steel Processing Distribution Co., Ltd. | 233,947,199 | 399,394,083 | ||
| Financing receivables | Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. | 50,000,000 | - | ||
| Jiangxi JMCG Specialty Vehicles Co., Ltd. | 40,000,000 | - | |||
| JMCG Jingma Motors Co., Ltd. | 3,000,000 | 2,357,022 | |||
| Jiangxi ISUZU Co., Ltd. | 600,000 | - | |||
| Nanchang JMCG Frame Co., Ltd. | - | 2,000,000 | |||
| 93,600,000 | 4,357,022 | ||||
| Notes receivable | Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. | 600,000,000 | - | ||
| Cash at bank | JMCF | 886,245,919 | 1,059,580,980 | ||
| Short-term borrowings | JMCF | 200,000,000 | - | ||
| In 2022, the sales amount settled by JMCF was RMB13,263,312,181 (2021: RMB21,188,639,037), of which, the amount of 169,310,000 was settled through the discounted electronic commercial acceptances which interest paid by buyers. As at December 31, 2022, the Group’s commercial acceptances amounting to 140,330,000 had discounted but not yet due (December 31, 2021: 676,750,000) arising under the aforesaid business. The Group has transferred substantially all the risks and rewards of ownership of its electronic commercial acceptances and therefore derecognized them. | |||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 7 | Related parties and related party transactions (Cont'd) | ||||
| (6) | Receivables from and payables to related parties (Cont’d) | ||||
| 31 December 2022 | 31 December 2021 | ||||
| Accounts payable | Nanchang Jiangling HuaXiang Auto Components Co., Ltd. | 538,861,064 | 476,070,536 | ||
| Jiangxi Jiangling Lear Interior System Co., Ltd. | 341,829,498 | 251,892,398 | |||
| Magna PT Powertrain (Jiangxi) Co., Ltd. | 295,727,129 | 224,125,697 | |||
| Jiangxi Jiangling Chassis Co., Ltd. | 287,843,287 | 314,370,464 | |||
| Jiangxi Zhonglian Intelligent Logistics Co., Ltd. | 280,456,600 | 188,395,117 | |||
| Jiangxi Jiangling Special Purpose Vehicle Co., Ltd. | 209,344,967 | 405,329,856 | |||
| Nanchang JMCG Liancheng Auto Component Co., Ltd. | 168,502,531 | 162,044,531 | |||
| Faurecia Emissions Control Technologies (Nanchang) Co., Ltd. | 142,695,801 | 181,015,647 | |||
| Ford | 63,701,961 | 112,369,950 | |||
| Nanchang Unistar Electric & Electronics Co., Ltd. | 59,831,745 | 118,507,723 | |||
| Hanon Systems | 52,260,989 | 51,492,058 | |||
| Nanchang JMCG Shishun Logistics Co., Ltd. | 51,617,596 | 99,211,184 | |||
| Jiangxi JMCG Specialty Vehicles Co., Ltd. | 48,084,822 | 46,385,916 | |||
| Nanchang JMCG SMR Huaxiang Mirror Co., Ltd. | 48,052,587 | 61,887,021 | |||
| Nanchang Yinlun Heat-exchanger Co., Ltd. | 38,139,971 | 38,501,505 | |||
| Jiangxi Lingge Non-ferrous Metal Die-casting Co., Ltd. | 29,858,865 | 38,128,081 | |||
| Dibao transportation equipment (Nanchang) Co., Ltd. | 29,824,381 | 29,226,123 | |||
| Jiangxi Lingyun Automobile Industry Technology Co., Ltd. | 22,971,514 | 9,533,560 | |||
| JMCG | 21,226,897 | 68,694,580 | |||
| Jiangxi Lingrui Recycling Resources Development Corporation | 15,959,512 | 5,669,023 | |||
| Nanchang Lianda Machinery Co., Ltd. | 15,928,121 | 19,653,964 | |||
| Jiangxi Jiangling Group Special Vehicle Co., Ltd. | 15,558,679 | 16,813,329 | |||
| Jiangling Motor Holdings Co., Ltd. | 7,254,527 | 15,315,388 | |||
| Jiangxi JMCG Boya brake system Co., Ltd. | 6,664,021 | 14,172,332 | |||
| Jiangxi Mingfang Auto Parts Industry Co., Ltd. | 5,244,867 | 1,920,999 | |||
| Auto Alliance (Thailand) Company Limited | 5,080,988 | 3,986,161 | |||
| Jiangling Aowei Automobile Spare Part Co., Ltd. | 4,202,862 | 4,402,913 | |||
| Jiangxi Jiangling group Fuxin Auto Parts Co., Ltd. | 3,044,022 | 5,126,842 | |||
| Changan Ford Automobile Co., Ltd. | 2,891,546 | 10,017,548 | |||
| Nanchang JMCG Xinchen Auto Component Co., Ltd. | 1,532,286 | 6,542,386 | |||
| Jiangling Material Co., Ltd. | 1,444,482 | 2,143,099 | |||
| Nanchang Hengou Industry Co., Ltd. | 998,215 | 1,537,861 | |||
| Ford Otomotiv Sanayi A.S. | 681,248 | 2,224,130 | |||
| Jiangxi ISUZU Engine Co., Ltd. | 407,986 | 7,167,608 | |||
| Nanchang Gear Forging Co.,Ltd. | 356,703 | 3,008,017 | |||
| Jiangxi JMCG Industry Co., Ltd. | 67,177 | 2,995,670 | |||
| Other related parties | 1,774,381 | 2,190,179 | |||
| 2,819,923,828 | 3,002,069,396 | ||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022
(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 7 | Related parties and related party transactions (Cont'd) | ||||
| (6) | Receivables from and payables to related parties (Cont’d) | ||||
| 31 December 2022 | 31 December 2021 | ||||
| Other payables | Ford | 190,788,653 | 61,135,567 | ||
| JMCG Jiangxi Engineering Construction Co., Ltd. | 73,068,908 | 112,247,451 | |||
| Ford Global Technologies, LLC | 57,966,899 | 65,331,412 | |||
| Jiangxi JMCG Specialty Vehicles Sales Corporation, Ltd. | 18,560,568 | 24,120,434 | |||
| Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. | 17,583,786 | 3,209,698 | |||
| Nanchang Jiangling HuaXiang Auto Components Co., Ltd. | 15,949,537 | 1,438,427 | |||
| Ford Motor (China) Co., Ltd. | 14,421,987 | 4,670,514 | |||
| Jiangxi Jiangling Special Purpose Vehicle Co., Ltd. | 11,939,889 | 5,719,260 | |||
| Nanchang JMCG Shishun Logistics Co., Ltd. | 7,599,823 | 7,302,639 | |||
| Jiangxi Jiangling Group Special Vehicle Co., Ltd. | 6,064,606 | 11,035,849 | |||
| Jiangxi JMCG Specialty Vehicles Co., Ltd. | 5,156,445 | 4,590,958 | |||
| Jiangxi JMCG Industry Co., Ltd. | 4,883,512 | 1,753,181 | |||
| Ford Otomotiv Sanayi A.S. | 4,749,574 | 4,578,953 | |||
| Chongqing Changan Automobile Co., Ltd. | 2,458,047 | 1,680,278 | |||
| Ford Motor Research & Engineering (Nanjing) Co., Ltd. | 2,397,259 | 2,229,384 | |||
| Nanchang Unistar Electric & Electronics Co., Ltd. | 1,908,865 | 966,018 | |||
| Hanon Systems | 1,475,000 | 1,475,000 | |||
| Nanchang Baojiang Steel Processing Distribution Co., Ltd. | 1,121,868 | 2,722,060 | |||
| Jiangxi Jiangling Lear Interior System Co., Ltd. | 584,675 | 1,007,000 | |||
| Faurecia Emissions Control Technologies (Nanchang) Co., Ltd. | 314,480 | 4,111,935 | |||
| JMCG Property Management Co., Ltd. | 22,736 | 1,265,900 | |||
| Magna PT Powertrain (Jiangxi) Co., Ltd. | - | 8,783,237 | |||
| Other related parties | 4,536,900 | 4,521,160 | |||
| 443,554,017 | 335,896,315 | ||||
| Contract liabilities | Guizhou Wanfu Vehicle Sales & Service Co., Ltd. | 1,902,370 | 376,671 | ||
| Jiangxi Jiangling Group Special Vehicle Co., Ltd. | 1,143,867 | 1,790,486 | |||
| Chongqing Anbo Vehicle Sales Co., Ltd. | 1,112,609 | 357,767 | |||
| Chengdu Wanxing Vehicle Sales & Service Co., Ltd. | 1,056,081 | 406,654 | |||
| Other related parties | 1,869,420 | 1,652,236 | |||
| 7,084,347 | 4,583,814 | ||||
| Lease liabilities | Jiangxi Jiangling Motors Imp. & Exp. Co., Ltd. | 9,542,357 | 17,391,559 | ||
| JMCG | 4,732,873 | 7,027,932 | |||
| 14,275,230 | 24,419,491 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 7 | Related parties and related party transactions (Cont'd) |
| (7) | Commitments in relation to related parties |
| Capital commitments | 31 December 2022 | 31 December 2021 | ||
| Nanchang Jiangling HuaXiang Auto Components Co., Ltd. | 20,786,749 | - | ||
| Jiangxi Jiangling Special Purpose Vehicle Co., Ltd. | 11,091,570 | - | ||
| Nanchang JMCG Liancheng Auto Component Co., Ltd. | 4,678,200 | - | ||
| Magna PT Powertrain (Jiangxi) Co., Ltd. | 3,955,000 | - | ||
| JMCG Jiangxi Engineering Construction Co., Ltd. | - | 270,278,911 | ||
| 40,511,519 | 270,278,911 | |||
| Guarantee of commitments in relation to related parties is set out in Note 7(5)(c). | ||||
| 8 | Contingencies | |||
| As at 31 December 2022, the Group had no contingencies that needed to be disclosed in the notes to the financial statements. | ||||
| 9 | Commitments | |||
| Capital expenditure commitments | ||||
| Capital expenditures contracted for by the Group but are not yet necessary to be recognised on the balance sheet as at the balance sheet date are as follows: | ||||
| 31 December 2022 | 31 December 2021 | |||
| Buildings, machinery and equipment | 484,700,000 | 1,040,550,000 | ||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022
(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 10 | Subsequent events |
| (1) | Profit distribution |
| According to the resolution at the Board of Directors’ meeting on 28 March 2023, the Board of Directors proposed that the Company distributes cash dividends of RMB0.424 per share to all shareholders. Based on the issued shares of 863,214,000, the proposed cash dividends totalled RMB366,002,736. | |
| 11 | Financial instrument and risk |
| The Group's activities expose it to a variety of financial risks, which mainly comprise market risk (primarily including foreign exchange risk and interest rate risk), credit risk and liquidity risk. The above financial risks and the Group's risk management policies to mitigate the risks are as follows: The Board of Directors is responsible for planning and establishing the Group's risk management framework, formulating the Group's risk management policies and related guidelines, and supervising the implementation of risk management measures. The Group has established risk management policies to identify and analyse the risks faced by the Group. These risk management policies specify the risks such as market risk, credit risk and liquidity risk management. The Group regularly evaluates the market environment and changes in the Group's operating activities to determine whether to update the risk management policies and systems or not. The Group’s risk management is carried out by the Risk Management Committee under policies approved by the Board of Directors. The Risk Management Committee works closely with other business departments of the Group to identify, evaluate and avoid relevant risks. The internal audit department of the Group conducts periodical audit to the controls and procedures for risk management and reports the audit results to the Risk Management Committee of the Group. |
| (1) | Market risk |
| (a) | Foreign exchange risk |
| The Group’s major operational activities are carried out in Mainland China and a majority of the transactions are denominated in RMB. The Group is exposed to foreign exchange risk arising from the recognised assets and liabilities, and future transactions denominated in foreign currencies, primarily with respect to USD. The Group continuously monitors the amount of assets and liabilities, and transactions denominated in foreign currencies to minimise the foreign exchange risk. Therefore, the Group signed forward exchange contracts to mitigate the foreign exchange risk (Note 4(3)). |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 11 | Financial instrument and risk (Cont’d) | |||||||
| (1) | Market risk (Cont’d) | |||||||
| (a) | Foreign exchange risk (Cont’d) | |||||||
| The financial assets and financial liabilities denominated in foreign currencies, which were held by the Group, were expressed in RMBas at 31 December 2022 and 31 December 2021 as follows: | ||||||||
| 31 December 2022 | ||||||||
| USD | EUR | Total | ||||||
| Financial assets denominated in foreign currency - | ||||||||
| Derivative financial assets | 808,826 | 2,163,872 | 2,972,698 | |||||
| Financial liabilities denominated in foreign currency - | ||||||||
| Current portion of long-term borrowings | 456,071 | - | 456,071 | |||||
| Long-term borrowings | 1,824,284 | - | 1,824,284 | |||||
| Other payables | 253,263,898 | 247,094 | 253,510,992 | |||||
| 255,544,253 | 247,094 | 255,791,347 | ||||||
| 31 December 2021 | |||||||
| USD | EUR | Total | |||||
| Financial liabilities denominated in foreign currency - | |||||||
| Derivative financial liabilities | 10,704,619 | - | 10,704,619 | ||||
| Current portion of long-term borrowings | 417,507 | - | 417,507 | ||||
| Long-term borrowings | 2,087,537 | - | 2,087,537 | ||||
| Other payables | 130,811,883 | 240,329 | 131,052,212 | ||||
| 144,021,546 | 240,329 | 144,261,875 | |||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 11 | Financial instrument and risk (Cont’d) | ||
| (1) | Market risk (Cont’d) | ||
| (a) | Foreign exchange risk (Cont’d) | ||
| As at 31 December 2022, for the financial assets and liabilities dominated in foreign currencies, if the RMBhad strengthened/weakened by 10% against the USD while all other variables had been held constant, the Group’s net profit would have been approximately RMB21,592,894 (31 December 2021: approximately RMB10,422,046) higher/lower. |
| (b) | Interest rate risk |
| The Group's interest rate risk mainly arises from interest-bearing debts such as short-term borrowings and long-term borrowings. The financial liabilities of floating interest rate expose the Group to cash flow interest rate risk, and the financial liabilities of fixed interest rate expose the Group to fair value interest rate risk. The Group determines the relative proportions of fixed-rate and floating-rate contracts based on the prevailing market environment. As at 31 December 2022, the Group’s short-term borrowings of RMB1,100,000,000 (31 December 2021: RMB300,000,000) were fixed-rate borrowings, and long-term borrowings of USD327,421 (31 December 2021: USD392,905) were fixed-rate contracts, long-term borrowings of RMB19,033,773 (31 December 2021: Nil) were fixed-rate borrowings, therefore there was no significant cash flow interest rate risk. | |
| As at 31 December 2022 and 31 December 2021, there was no significant difference between the fair value and the carrying amount of the Group’s bank borrowings with fixed rates. | |
| (2) | Credit risk |
| The Group’s credit risk mainly arises from cash at bank and on hand, notes receivable, accounts receivable, financing receivables, other receivables, long-term receivables and derivative financial assets at fair value through profit or loss that are not included in the impairment assessment scope. The carrying amount of the Group’s financial assets reflects its maximum credit exposure at the balance sheet date. | |
| The Group expects that there is no significant credit risk associated with cash at bank and on hand since they are deposited at state-owned banks and other medium or large size banks with good reputation and high credit rating. The Group does not expect that there will be significant losses from non-performance by these banks. |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 11 | Financial instrument and risk (Cont’d) |
| (2) | Credit risk (Cont’d) |
| In addition, the Group has policies to limit the credit exposure on notes receivable, accounts receivable, financing receivables, other receivables and long-term receivables. The Group assesses the credit quality of and sets credit limits on its customers by taking into account their financial position, the availability of guarantee from third parties, their credit history and other factors such as current market conditions. The credit history of the customers is regularly monitored by the Group. In respect of customers with a poor credit history, the Group will use written payment reminders, or shorten or cancel credit periods, to ensure the overall credit risk of the Group is limited to a controllable extent. | |
| As at 31 December 2022, the Group had no significant collateral or other credit enhancements held as a result of the debtor’s mortgage (31 December 2021: Nil). |
| (3) | Liquidity risk |
| Cash flow forecasting is performed by each subsidiary of the Group and aggregated by the Group. The Group monitors rolling forecasts of the Group's short-term and long-term liquidity requirements to ensure it has sufficient cash, while maintaining sufficient headroom on its undrawn committed borrowing facilities from major financial institutions so that the Group does not breach borrowing limits or covenants on any of its borrowing facilities to meet the short-term and long-term liquidity requirements. |
| The financial liabilities of the Group at the balance sheet date are analysed by their maturity date below at their undiscounted contractual cash flows: |
| 31 December 2022 | |||||||||||
| Within 1 year | 1 to 2 years | 2 to 5 years | Over 5 years | Total | |||||||
| Short-term borrowings | 1,100,000,000 | - | - | - | 1,100,000,000 | ||||||
| Accounts payable | 9,015,978,354 | - | - | - | 9,015,978,354 | ||||||
| Other payables | 5,672,708,511 | - | - | - | 5,672,708,511 | ||||||
| Lease liabilities | 81,918,426 | 71,289,585 | 132,786,495 | - | 285,994,506 | ||||||
| Long-term borrowings | 488,566 | 19,515,498 | 1,404,129 | - | 21,408,193 | ||||||
| 15,871,093,857 | 90,805,083 | 134,190,624 | - | 16,096,089,564 | |||||||
| 31 December 2021 | |||||||||||
| Within 1 year | 1 to 2 years | 2 to 5 years | Over 5 years | Total | |||||||
| Short-term borrowings | 300,000,000 | - | - | - | 300,000,000 | ||||||
| Derivative financial liabilities | 10,704,619 | - | - | - | 10,704,619 | ||||||
| Accounts payable | 9,702,584,830 | - | - | - | 9,702,584,830 | ||||||
| Other payables | 5,253,800,805 | - | - | - | 5,253,800,805 | ||||||
| Lease liabilities | 90,602,618 | 80,927,296 | 203,090,850 | - | 374,620,764 | ||||||
| Long-term borrowings | 453,517 | 447,254 | 1,304,189 | 422,205 | 2,627,165 | ||||||
| 15,358,146,389 | 81,374,550 | 204,395,039 | 422,205 | 15,644,338,183 | |||||||
| (i) | As at 31 December 2022, the Group did not have lease contracts that had been signed but had not yet been implemented. |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022
(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 12 | Fair value estimates |
| The level in which fair value measurement is categorised is determined by the level of the fair value hierarchy of the lowest level input that is significant to the entire fair value measurement: | |
| Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities. | |
| Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. | |
| Level 3: Unobservable inputs for the asset or liability. |
| (1) | Assets and liabilities measured at fair value on a recurring basis | |||||||
| As at 31 December 2022, the assets measured at fair value on a recurring basis by the above three levels were analysed below: | ||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||
| Financial assets - | ||||||||
| Financing receivables - | ||||||||
| Notes receivable | - | - | 376,662,817 | 376,662,817 | ||||
| Derivative financial assets - | ||||||||
| Forward foreign exchange contracts | - | 2,972,698 | - | 2,972,698 | ||||
| - | 2,972,698 | 376,662,817 | 379,635,515 | |||||
| As at 31 December 2022, the group didn’t have liabilities measured at fair value on a recurring basis. | ||||||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 12 | Fair value estimates (Cont’d) |
| (1) | Assets and liabilities measured at fair value on a recurring basis (Cont'd) |
| As at 31 December 2021, the assets measured at fair value on a recurring basis by the above three levels were analysed below: | ||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||
| Financial assets - | ||||||||
| Financial assets held for trading - | ||||||||
| Structural deposits | - | 100,242,329 | - | 100,242,329 | ||||
| Financing receivables - | ||||||||
| Notes receivable | - | - | 201,511,670 | 201,511,670 | ||||
| - | 100,242,329 | 201,511,670 | 301,753,999 | |||||
| As at 31 December 2021, the liabilities measured at fair value on a recurring basis by the above three levels were analysed below: | ||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||
| Financial liabilities - | ||||||||
| Derivative financial liabilities - | ||||||||
| Forward foreign exchange contracts | - | 10,704,619 | - | 10,704,619 | ||||
| The Group takes the date on which events causing the transfers between the levels take place as the timing specific for recognising the transfers. There was no transfer between Level 1 and Level 2 in 2022. | |
| The fair value of financial instruments traded in an active market is determined at the quoted market price; and the fair value of those not traded in an active market is determined by the Group using valuation technique. The valuation models used mainly comprise discounted cash flow model and market comparable corporate model. The inputs of valuation technique mainly include risk-free interest rate, benchmark rate, exchange rate, credit spreads, liquidity premium, EBITDA multiplier and liquidity lack discount. |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022
(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 12 | Fair value estimates (Cont’d) | ||||||||||||||
| (1) | Assets and liabilities measured at fair value on a recurring basis (Cont'd) | ||||||||||||||
| The changes in Level 3 assets are analysed below: | |||||||||||||||
| 31 December 2021 | Increase | Decrease | 31 December 2022 | Gains recognised in profit or loss | Changes in unrealised gains or losses included in profit or loss in 2022 with respect to assets still held as at 31 December 2022 - gains or losses on changes in fair value | ||||||||||
| Financing receivables - | |||||||||||||||
| Notes receivable | 201,511,670 | 3,664,369,012 | (3,489,217,865) | 376,662,817 | - | - | |||||||||
| Total assets | 201,511,670 | 3,664,369,012 | (3,489,217,865) | 376,662,817 | - | - | |||||||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 12 | Fair value estimates (Cont’d) | ||
| (1) | Assets and liabilities measured at fair value on a recurring basis (Cont'd) | ||
| The changes in Level 3 assets are analysed below (Cont'd): | |||
| 31 December 2020 | Increase | Decrease | 31 December 2021 | Gains recognised in profit or loss (a) | Changes in unrealised gains or losses included in profit or loss in 2021 with respect to assets still held as at 31 December 2021 - gains or losses on changes in fair value | ||||||||
| Financial assets | |||||||||||||
| Financial assets held for trading - | |||||||||||||
| Monetary fund | - | 500,000,000 | (500,000,000) | - | 198,623 | - | |||||||
| Financing receivables - | |||||||||||||
| Notes receivable | 815,583,669 | 3,073,998,320 | (3,688,070,319) | 201,511,670 | - | - | |||||||
| Total assets | 815,583,669 | 3,573,998,320 | (4,188,070,319) | 201,511,670 | 198,623 | - |
| (a) | Gains recognised in profit or loss are recognised in investment income in the income statement. |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 12 | Fair value estimates (Cont’d) |
| (2) | Assets measured at fair value on a non-recurring basis |
| As at 31 December 2022 and 31 December 2021, the Group had no assets measured at fair value on a non-recurring basis. | |
| (3) | Assets and liabilities not measured at fair value but for which the fair value is disclosed |
| The Group’s financial assets and liabilities measured at amortised cost mainly comprise notes receivable, accounts receivable, other receivables, long-term receivables, short-term borrowings, payables, lease liabilities and long-term borrowings. | |
| The carrying amount of the Group's financial assets and liabilities not measured at fair value is a reasonable approximation of their fair value. | |
| The fair value of long-term borrowings and lease liabilities is the present value of the contractually determined stream of future cash flows discounted at the rate of interest applied at that time by the market to instruments of comparable credit status and providing substantially the same cash flows on the same terms, and categorised within Level 3 of the fair value hierarchy. |
| 13 | Capital management |
| The Group’s capital management policies aim to safeguard the Group’s ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders, and to maintain an optimal capital structure to reduce the cost of capital. | |
In order to maintain or adjust the capital structure, the Group may adjust the amount ofdividends paid to shareholders, refund capital to shareholders, issue new shares or sellassets to reduce debts.
| The Group's total capital is calculated as “shareholders’ equity” as shown in the consolidated balance sheet. The Group is not subject to external mandatory capital requirements, and monitors capital on the basis of equity ratio. | ||||
| As at 31 December 2022 and 31 December 2021, the Group's equity ratio was as follows: | ||||
| 31 December 2022 | 31 December 2021 | |||
| Total borrowings | 1,121,314,128 | 302,505,044 | ||
| Total shareholders’ equity | 9,240,646,784 | 8,555,444,589 | ||
| Equity ratio | 12% | 4% | ||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 14 | Notes to the Company’s financial statements |
| (1) | Accounts receivable | |||
| 31 December 2022 | 31 December 2021 | |||
| Accounts receivable | 2,444,372,969 | 1,576,660,469 | ||
| Less: Provision for bad debts | (75,474,642) | (167,340,229) | ||
| 2,368,898,327 | 1,409,320,240 | |||
| (a) | The ageing of accounts receivable is analysed as follows: | |||
| 31 December 2022 | 31 December 2021 | |||
| Within 1 year | 2,281,564,617 | 1,231,549,719 | ||
| Over 1 year | 162,808,352 | 345,110,750 | ||
| 2,444,372,969 | 1,576,660,469 | |||
| (b) | As at 31 December 2022, the top five accounts receivable ranked by remaining balances were analysed as follows: | |||||
| Balance | Amount of provision for bad debts | % of total balance | ||||
| Company 1 | 1,794,825,748 | (1,447,904) | 73.43% | |||
| Company 2 | 241,829,851 | - | 9.89% | |||
| Company 3 | 105,318,231 | - | 4.31% | |||
| Company 4 | 72,230,000 | (72,230,000) | 2.95% | |||
| Company 5 | 46,820,892 | (140,841) | 1.92% | |||
| 2,261,024,722 | (73,818,745) | 92.50% | ||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 14 | Notes to the Company’s financial statements (Cont’d) |
| (1) | Accounts receivable (Cont’d) |
| (c) | Provision for bad debts |
| (i) | Accounts receivable for which provision for bad debts is made on the individual basis are analysed as follows: |
| 31 December 2022 | |||||||
| Book balance | Provision for bad debts | ||||||
| Amount | Lifetime ECL (%) | Amount | |||||
| Receivables from related parties within the Group i) | 347,148,082 | - | - | ||||
| Receivables for automobiles ii) | 72,230,000 | 100% | (72,230,000) | ||||
| 419,378,082 | (72,230,000) | ||||||
| 31 December 2021 | |||||
| Book balance | Provision for bad debts | ||||
| Amount | Lifetime ECL (%) | Amount | |||||
| Receivables from related parties within the Group i) | 74,668,369 | - | - | ||||
| New energy subsidies receivable ii) | 84,903,126 | 100% | (84,903,126) | ||||
| Receivables for automobiles ii) | 72,230,000 | 100% | (72,230,000) | ||||
| 231,801,495 | (157,133,126) |
| i) As at 31 December 2022, the Company's accounts receivable from subsidiary JMCS and SZFJ was RMB241,829,851 and RMB105,318,231(31 December 2021：Nil and RMB 74,668,369). The Company carried out individual assessment on receivables from subsidiaries. Based on the judgement of credit risk, there was no significant credit risk on receivables from subsidiaries that were overdue and impaired. | |
| ii) As at 31 December 2022, the Company assessed the expected credit losses on the related accounts receivable and expected that it was probable that such amounts would not be collected and therefore a full provision for bad debts was made. |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 14 | Notes to the Company’s financial statements (Cont’d) |
| (1) | Accounts receivable (Cont’d) |
| (c) | Provision for bad debts (Cont’d) |
| (ii) | Accounts receivable for which provision for bad debts is made on the grouping basis are analysed as follows: |
| Grouping - Sales of general automobiles: | |||||||
| 31 December 2022 | |||||||
| Book balance | Provision for bad debts | ||||||
| Amount | Lifetime ECL (%) | Amount | |||||
| Not overdue | 1,574,700,311 | 0.04% | (676,307) | ||||
| Overdue for 1 to 30 days | 20,338,359 | 0.04% | (8,715) | ||||
| Overdue for 31 to 60 days | 7,025,162 | 1.07% | (75,033) | ||||
| Overdue for 61 to 90 days | - | — | - | ||||
| Overdue over 90 days | 1,046,303 | 3.37% | (35,212) | ||||
| 1,603,110,135 | (795,267) | ||||||
| 31 December 2021 | |||||||
| Book balance | Provision for bad debts | ||||||
| Amount | Lifetime ECL (%) | Amount | |||||
| Not overdue | 833,314,688 | 0.08% | (675,142) | ||||
| Overdue for 1 to 30 days | 149,950,389 | 0.08% | (120,161) | ||||
| Overdue for 31 to 60 days | 29,645,955 | 2.44% | (721,967) | ||||
| Overdue for 61 to 90 days | 17,638,503 | 4.15% | (732,260) | ||||
| Overdue over 90 days | 114,035 | 5.01% | (5,710) | ||||
| 1,030,663,570 | (2,255,240) | ||||||
| Grouping - Sales of new energy automobiles: | |||||||
| 31 December 2022 | |||||||
| Book balance | Provision for bad debts | ||||||
| Amount | Lifetime ECL (%) | Amount | |||||
| Overdue over 90 days | 4,853,760 | 20.60% | (999,805) | ||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022
(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 14 | Notes to the Company’s financial statements (Cont’d) |
| (1) | Accounts receivable (Cont’d) |
| (c) | Provision for bad debts (Cont’d) |
| (ii) | Accounts receivable for which provision for bad debts is made on the grouping basis are analysed as follows (Cont’d): |
| Grouping - Sales of new energy automobiles (Cont’d): |
| 31 December 2021 | |||||||
| Book balance | Provision for bad debts | ||||||
| Amount | Lifetime ECL (%) | Amount | |||||
| Overdue over 90 days | 111,207,654 | 6.51% | (7,234,301) | ||||
| Grouping - Automobile parts: |
| 31 December 2022 | |||||||
| Book balance | Provision for bad debts | ||||||
| Amount | Lifetime ECL (%) | Amount | |||||
| Not overdue | 400,583,282 | 0.30% | (1,201,749) | ||||
| Overdue for 1 to 30 days | 10,972,629 | 0.30% | (32,918) | ||||
| Overdue for 31 to 60 days | 1,307,433 | 0.50% | (6,537) | ||||
| Overdue for 61 to 90 days | 377 | 0.53% | (2) | ||||
| Overdue over 90 days | 4,167,271 | 5.00% | (208,364) | ||||
| 417,030,992 | (1,449,570) | ||||||
| 31 December 2021 | |||||||
| Book balance | Provision for bad debts | ||||||
| Amount | Lifetime ECL (%) | Amount | |||||
| Not overdue | 171,058,119 | 0.30% | (513,174) | ||||
| Overdue for 1 to 30 days | 10,595,578 | 0.30% | (31,787) | ||||
| Overdue for 31 to 60 days | 14,644,585 | 0.50% | (73,223) | ||||
| Overdue for 61 to 90 days | 3,464,188 | 0.60% | (20,785) | ||||
| Overdue over 90 days | 3,225,280 | 2.44% | (78,593) | ||||
| 202,987,750 | (717,562) | ||||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| (d) | The book balance of new energy subsidies receivable that was written off in 2022 was RMB86,739,957, and the provision for bad debts was RMB86,739,957. The above write-offs were not related transactions and had been approved by the board of directors. |
| (e) | As at 31 December 2022 and 31 December 2021, the Company did not have accounts receivable that were pledged. |
| (2) | Other receivables |
| 31 December 2022 | 31 December 2021 | |||
| Receivable for subsidiary disposal | 60,900,000 | 252,000,000 | ||
| Receivables from Jiangling(Shanghai) | 14,426,224 | - | ||
| Import working capital | 10,000,000 | 25,000,000 | ||
| Receivables from JMCH | 9,679,410 | 9,679,410 | ||
| Disposal of assets | 4,604,745 | 17,668,457 | ||
| Others | 29,561,083 | 97,471,253 | ||
| 129,171,462 | 401,819,120 | |||
| Less: Provision for bad debts | (315,611) | (1,031,283) | ||
| 128,855,851 | 400,787,837 |
| (a) | The ageing of other receivables is analysed as follows: | |||
| 31 December 2022 | 31 December 2021 | |||
| Within 1 year | 55,337,691 | 399,577,953 | ||
| Over 1 year | 73,833,771 | 2,241,167 | ||
| 129,171,462 | 401,819,120 | |||
| (b) | Provision for losses and changes in book balance statements |
| Stage 1 | Total | ||||||||
| 12-month ECL (grouping) | 12-month ECL (individual) | ||||||||
| Book balance | Provision for bad debts | Book balance | Provision for bad debts | Provision for bad debts | |||||
| 31 December 2021 | 392,139,710 | (1,031,283) | 9,679,410 | - | (1,031,283) | ||||
| Net (decrease)/increase in the current year | (287,073,882) | — | 14,426,224 | — | — | ||||
| Provision for bad debts reserved in the current year | — | 715,672 | — | - | 715,672 | ||||
| 31 December 2022 | 105,065,828 | (315,611) | 24,105,634 | - | (315,611) | ||||
| 14 | Notes to the Company’s financial statements (Cont’d) |
| (1) | Accounts receivable (Cont’d) |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 14 | Notes to the Company’s financial statements (Cont’d) | ||||||
| (2) | Other receivables (Cont’d) | ||||||
| (b) | Provision for losses and changes in book balance statements (Cont’d) | ||||||
| As at 31 December 2022 and 31 December 2021, the Company did not have any other receivables at Stage 2 or Stage 3. Other receivables at Stage 1 were analysed below: | |||||||
| (i) | As at 31 December 2022 and 31 December 2021, provision for bad debts of other receivables on the individual basis was analysed as follows: | ||||||
| 31 December 2022 | |||||||
| Stage 1 | Book balance | 12-month ECL (%) | Provision for bad debts | Reason | |||
| Receivables from Jiangling Ford (Shanghai) | 14,426,224 | - | - | i) | |||
| Receivables from JMCH | 9,679,410 | - | - | i) | |||
| 24,105,634 | - | ||||||
| 31 December 2021 |
| Stage 1 | Book balance | 12-month ECL (%) | Provision for bad debts | Reason | |||
| Receivables from JMCH | 9,679,410 | - | - | i) |
| i) As of December 31, 2022, the Company had other receivables from its subsidiaries, Jiangling Ford (Shanghai) and JMCH, amounting to RMB14,426,224 and RMB9,679,410 (31 December 2021: Nil and RMB9,679,410).The Company assessed the receivables from subsidiaries individually and based on the judgment of credit risk, the receivables from subsidiaries are not subject to significant credit risk and are not past due and impaired. |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 14 | Notes to the Company’s financial statements (Cont’d) |
| (2) | Other receivables (Cont’d) |
| (b) | Provision for losses and changes in book balance statements (Cont’d) |
| (ii) | As at 31 December 2022 and 31 December 2021, the Company’s other receivables with provision for bad debts on the grouping basis were analysed below: |
| Other receivables with provision on the grouping basis at Stage 1: |
| (ii) | As at 31 December 2022, the Company’s other receivables with provision for bad debts on the grouping basis were analysed below: |
| Book balance | Expected credit loss ratio within the next 12 months | Provision for bad debts | Rationale | |||||
| Portfolio accrual： | ||||||||
| Receivable for subsidiary disposal | 60,900,000 | 0.30% | (182,700) | Expected credit losses | ||||
| Import working capital | 10,000,000 | 0.30% | (30,000) | Expected credit losses | ||||
| Disposal of assets | 4,604,745 | 0.30% | (13,814) | Expected credit losses | ||||
| Others | 29,561,083 | 0.30% | (89,097) | Expected credit losses | ||||
| 105,065,828 | (315,611) |
| (iii) | As at 31 December 2021, the Company’s other receivables with provision for bad debts on the grouping basis were analysed below: |
| Book balance | Expected credit loss ratio within the next 12 months | Provision for bad debts | Rationale | |||||
| Portfolio accrual： | ||||||||
| Receivable for subsidiary disposal | 252,000,000 | 0.30% | (756,000) | Expected credit losses | ||||
| Import working capital | 25,000,000 | 0.30% | (75,000) | Expected credit losses | ||||
| Disposal of assets | 17,668,457 | 0.30% | (53,005) | Expected credit losses | ||||
| Others | 49,340,289 | 0.30% | (147,278) | Expected credit losses | ||||
| Interest receivable | 48,130,964 | - | - | Expected credit losses | ||||
| 392,139,710 | (1,031,283) |
| As at 31 December 2022 and 31 December 2021, the Company had no other receivables at Stage 2 or Stage 3. |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022
(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 14 | Notes to the Company’s financial statements (Cont’d) |
| (2) | Other receivables (Cont’d) |
| (c) | In 2022, the provision for bad debts reversed amounted to RMB715,672. |
| (d) | In 2022, no other receivables were written off. |
| (e) | As at 31 December 2022, the top five other receivables ranked by remaining balances were analysed as follows: | |||||||||
| Nature | Balance | Ageing | % of total balance | Provision for bad debts | ||||||
| Company 1 | Receivable for subsidiary disposal | 60,900,000 | Over 1 year | 47.15% | (182,700) | |||||
| Company 2 | Receivable from subsidiary | 14,426,224 | Within 1 year | 11.17% | - | |||||
| Company 3 | Advances classified as expenses | 12,919,400 | Within 1 year | 10.00% | (38,758) | |||||
| Company 4 | Import working capital, etc. | 10,231,067 | Within 1 year | 7.92% | (30,693) | |||||
| Company 5 | Receivable from subsidiary | 9,679,410 | Over 1 year | 7.49% | - | |||||
| 108,156,101 | 83.73% | (252,151) | ||||||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 14 | Notes to the Company’s financial statements (Cont’d) | |||
| (3) | Long-term equity investments | |||
| 31 December 2022 | 31 December 2021 | |||
| Subsidiaries (a) | 2,807,943,493 | 2,756,943,493 | ||
| Associates (b) | 243,633,812 | 252,402,245 | ||
| 3,051,577,305 | 3,009,345,738 | |||
| Less: Provision for impairment of long-term equity investments for subsidiaries | (1,905,543,493) | (1,905,543,493) | ||
| Provision for impairment of long-term equity investments for associates | - | - | ||
| (1,905,543,493) | (1,905,543,493) | |||
| 1,146,033,812 | 1,103,802,245 | |||
| (a) | Subsidiaries |
| Movement in the current year | ||||||||||||||
| 31 December 2021 | Additional investments | 31 December 2022 | Balance of provision for impairment at the end of the year | Cash dividends declared this year | 31 December 2022 | |||||||||
| Gross amount | Gross amount | Carrying amount | ||||||||||||
| JMCH | 2,686,943,493 | - | 2,686,943,493 | (1,905,543,493) | - | 781,400,000 | ||||||||
| JMCS | 50,000,000 | - | 50,000,000 | - | - | 50,000,000 | ||||||||
| SZFJ | 10,000,000 | - | 10,000,000 | - | - | 10,000,000 | ||||||||
| GZFJ | 10,000,000 | - | 10,000,000 | - | - | 10,000,000 | ||||||||
| Jiangling Ford (Shanghai) | - | 51,000,000 | 51,000,000 | - | - | 51,000,000 | ||||||||
| 2,756,943,493 | 51,000,000 | 2,807,943,493 | (1,905,543,493) | - | 902,400,000 | |||||||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR EDNED 31 DECEMBER 2022
(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 14 | Notes to the Company’s financial statements (Cont’d) |
| (3) | Long-term equity investments (Cont’d) |
| (b) | Associates |
| Movements in the current year | ||||||||||||||||||
| 31 December 2021 | Increase in the current year | Share of net profit/(loss) under equity method | Cash dividends declared by joint ventures | Provision for impairment | 31 December 2022 | Shareholding (%) | Voting rights (%) | Ending balance of provision for impairment | ||||||||||
| The Power Company | 215,993,605 | - | (9,786,926) | - | - | 206,206,679 | 40% | 40% | - | |||||||||
| Hanon Systems | 36,408,640 | - | 1,018,493 | - | - | 37,427,133 | 19.15% | 33.33% | - | |||||||||
| Total | 252,402,245 | - | (8,768,433) | - | - | 243,633,812 | - | |||||||||||
SUPPLEMENTARY INFORMATION TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 14 | Notes to the Company’s financial statements (Cont’d) | |||
| (4) | Revenue and cost of sales | |||
| 2022 | 2021 | |||
| Revenue from main operations | 27,601,273,209 | 32,230,431,936 | ||
| Revenue from other operations | 499,724,240 | 661,606,456 | ||
| 28,100,997,449 | 32,892,038,392 | |||
| 2022 | 2021 | |||
| Cost of sales from main operations | 24,557,964,422 | 28,545,317,717 | ||
| Cost of sales from other operations | 462,474,326 | 564,998,651 | ||
| 25,020,438,748 | 29,110,316,368 |
| (a) | Revenue and cost of sales from main operations | |||||
| 2022 | 2021 | |||||
| Revenue from main operations | Cost of sales from main operations | Revenue from main operations | Cost of sales from main operations | |||
| Sales of automobiles | 25,235,142,483 | 22,674,692,674 | 30,095,151,966 | 26,882,101,617 | ||
| Sales of automobile parts | 2,341,764,663 | 1,871,646,827 | 2,026,158,467 | 1,544,733,777 | ||
| Automobile maintenance services | 24,366,063 | 11,624,921 | 109,121,503 | 118,482,323 | ||
| 27,601,273,209 | 24,557,964,422 | 32,230,431,936 | 28,545,317,717 | |||
| (b) | Revenue and cost of sales from other operations | |||||
| 2022 | 2021 | |||||
| Revenue from other operations | Cost of sales from other operations | Revenue from other operations | Cost of sales from other operations | |||
| Sales of materials | 367,010,370 | 339,961,257 | 473,568,747 | 441,423,371 | ||
| Others | 132,713,870 | 122,513,069 | 188,037,709 | 123,575,280 | ||
| 499,724,240 | 462,474,326 | 661,606,456 | 564,998,651 | |||
SUPPLEMENTARY INFORMATION TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 14 | Notes to the Company’s financial statements (Cont’d) | |||||
| (4) | Revenue and cost of sales (Cont’d) | |||||
| (c) | The breakdown of revenue earned was as follows: | |||||
| 2022 | ||||||
| Automobiles | Automobile parts | Automobile maintenance services | Materials and others | Total | ||
| Revenue from main operations | 25,235,142,483 | 2,341,764,663 | 24,366,063 | - | 27,601,273,209 | |
| Including: Recognised at a time point | 25,235,142,483 | 2,341,764,663 | - | - | 27,576,907,146 | |
| Recognised within a certain period | - | - | 24,366,063 | - | 24,366,063 | |
| Revenue from other operations (i) | - | - | - | 499,724,240 | 499,724,240 | |
| 25,235,142,483 | 2,341,764,663 | 24,366,063 | 499,724,240 | 28,100,997,449 | ||
| 2021 | ||||||
| Automobiles | Automobile parts | Automobile maintenance services | Materials and others | Total | ||
| Revenue from main operations | 30,095,151,966 | 2,026,158,467 | 109,121,503 | - | 32,230,431,936 | |
| Including: Recognised at a time point | 30,095,151,966 | 2,026,158,467 | - | - | 32,121,310,433 | |
| Recognised within a certain period | - | - | 109,121,503 | - | 109,121,503 | |
| Revenue from other operations (i) | - | - | - | 661,606,456 | 661,606,456 | |
| 30,095,151,966 | 2,026,158,467 | 109,121,503 | 661,606,456 | 32,892,038,392 | ||
| (i) | The Company's revenue from other operations includes sales of materials and technical service provided, etc. Of which, revenue from sales of materials is recognized at a certain point in time, and revenue from technical service provided is recognized within a certain period. | |||
| As at 31 December 2022, the amount of revenue corresponding to the performance obligations that the Company had signed but had not performed or had not yet performed was RMB1,011,195, and the Company expected that RMB1,011,195 will be recognised as revenue from the sales of automobiles and parts in 2023. | ||||
| (5) | Investment income | |||
| 2022 | 2021 | |||
| Investment loss from forward exchange settlement | (13,534,785) | (20,618,121) | ||
| Losses on discount of financing receivables eligible for derecognition | (12,990,879) | (8,344,916) | ||
| Gains on long-term equity investments under equity method | (8,768,433) | (21,475,697) | ||
| Investment income from financial assets held for trading | - | 3,894,456 | ||
| (35,294,097) | (46,544,278) | |||
| There is no significant restriction on the remittance of investment income to the Company. | ||||
SUPPLEMENTARY INFORMATION TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2022
(All amounts in RMBYuan unless otherwise stated)[English translation for reference only]
| 1 | Statement of non-recurring profit or loss | |||
| 2022 | 2021 | |||
| Government grants recognised in profit or loss for the current period | 943,326,556 | 552,831,370 | ||
| Gains or losses on disposal of non-current assets | 389,251,475 | 5,107,814 | ||
| Fund occupation fee received from non-financial institutions | 13,827,410 | 15,836,668 | ||
| Gains or losses on disposal of long-term equity investments | - | 52,133,307 | ||
| Gains or losses arising from changes in fair value of financial assets and liabilities held at fair value through profit or loss, and investment losses on disposal of related financial assets and liabilities | 1,424,039 | (16,082,076) | ||
| Net amount of other non-operating income and expenses | 1,423,948 | 2,027,076 | ||
| Reversal of provision for impairment of receivables tested individually | 110,068 | 2,250,000 | ||
| Other items of profit or loss conforming to the definition of non-recurring profit or loss | - | 18,765,020 | ||
| 1,349,363,496 | 632,869,179 | |||
| Effect of income tax | (204,283,363) | (88,332,046) | ||
| Effect of gains or losses on minority interests (net of tax) | (363,305) | - | ||
| 1,144,716,828 | 544,537,133 | |||
| Basis for preparation of statement of non-recurring profit or loss | ||||
| Under the requirements in the Explanatory Announcement No. 1 on Information Disclosure by Companies Offering Securities to the Public - Non-recurring Profit or Loss [2008] from CSRC, non-recurring profit or loss refers to that arises from transactions and events that are not directly relevant to ordinary activities, or that are relevant to ordinary activities, but are extraordinary and not expected to recur frequently that would have an influence on users of financial statements making economic decisions on the financial performance and profitability of an enterprise. | ||||
| 2 | Return on net assets and earnings per share | ||||||
| Weighted average return on net assets (%) | Earnings per share | ||||||
| Basic earnings per share | Diluted earnings per share | ||||||
| 2022 | 2021 | 2022 | 2021 | 2022 | 2021 | ||
| Net profit attributable to ordinary shareholders of the Company | 10.28% | 5.87% | 1.06 | 0.67 | 1.06 | 0.67 | |
| Net profit attributable to ordinary shareholders of the Company, net of non-recurring profit or loss | (2.58%) | 0.30% | (0.27) | 0.03 | (0.27) | 0.03 | |