SHENZHEN CEREALS HOLDINGS CO. LTD.
SEMI-ANNUAL REPORT 2019
August 2019
2
Section I. Important Notice Contents and Paraphrase
Board of Directors Supervisory Committee all directors supervisors and senior
executives of SHENZHEN CEREALS HOLDINGS CO. LTD.(hereinafter
referred to as the Company) hereby confirm that there are no any fictitious
statements misleading statements or important omissions carried in this report
and shall take all responsibilities individual and/or joint for the reality
accuracy and completion of the whole contents.
Chairman of the Company Zhu Junming General Manager Hu Xianghai Head
of Accounting Ye Qingyun and Head of Accounting Institution (Accounting
Supervisors) Wen Jieyu hereby confirm that the Financial Report of
Semi-Annual Report 2019 is authentic accurate and complete.
All Directors are attended the Board Meeting for deliberation of this Report.
Concerning the forward-looking statements with future planning involved in the
annual report they do not constitute a substantial commitment for investors
Securities Times China Securities Journal Hong Kong Commercial Daily and
Juchao Website (www.cninfo.com.cn) are the media appointed by the Company
for information disclosure all information of the Company disclosed in the
above mentioned media should prevail. Investors are advised to exercise caution
of investment risks.The Company has analyzed the risk factors that the Company may exist and its
3
countermeasures in the report investors are advised to pay attention to read
“Risks and Countermeasures” in the report of Section IV-Discussion and
Analysis of the Operation. This report has been prepared in Chinese and English
version respectively. In the event of difference in interpretation between the two
versions Chinese report shall prevail.The Company plans not to distributed cash dividend bonus and no capitalizing
of common reserves either.4
Contents
Section I. Important Notice Contents and Paraphrase ......................................... 2
Section II. Company Profile and Main Financial Indexes ..................................... 6
Section III. Summary of Company Business ........................................................ 11
Section IV. Discussion and Analysis of the Operation .......................................... 16
Section V. Important Events .................................................................................. 29
Section VI. Changes in Shares and Particulars about Shareholders ................... 40
Section VII. Preferred Stock .................................................................................. 45
Section VIII. Particulars about Directors Supervisor and Senior Executives ... 46
Section IX. Corporate Bonds ................................................................................. 48
Section X. Financial Report ................................................................................... 49
Section XI. Documents available for Reference .................................................. 238
5
Paraphrase
Items Refers to Contents
SZCH/Listed Company /the Company Refers to Shenzhen Cereals Holdings Co. Ltd.
SZCG Refers to Shenzhen Cereals Group Co. Ltd
Doximi Refers to SZCG Doximi Business Co. Ltd.
Flour Company Refers to Shenzhen Flour Co. Ltd
SZCG Quality Inspection Refers to SZCG Quality Inspection Co. Ltd.
Dongguan Logistics / SZCG Dongguan
Logistics
Refers to SZCG Dongguan Logistics Co. Ltd.
Dongguan Food Industrial Park Refers to Dongguan International Food Industrial Park Development Co. Ltd.
Wuyuan Ju Fang Yong Refers to Ju Fang Yong Tea Industry Co. Ltd. in Wuyuan County
Shenbao Technology Center Refers to Shenzhen Shenbao Technology Center Co. Ltd.
Fude Capital Refers to Shenzhen Fude State-Owned Capital Operation Co. Ltd.
Agricultural Products Refers to Shenzhen Agricultural Products Co. Ltd
Shenzhen SASAC Refers to
Shenzhen Municipal People’s Government State-owned Assets
Supervision & Administration Commission
CSRC Refers to China Securities Regulation Commission
RMB/10 thousand Yuan Refers to CNY/ten thousand Yuan
6
Section II. Company Profile and Main Financial Indexes
I. Company profile
Short form for share SZCH Shenliang B Stock code 000019 200019
Listing stock exchange Shenzhen Stock Exchange
Chinese name of the Company 深圳市深粮控股股份有限公司
Abbr. of Chinese name of the
Company (if applicable)深粮控股
English name of the Company
(if applicable)
SHENZHEN CEREALS HOLDINGS CO.LTD
Legal Representative Zhu Junming
II. Person/Way to contact
Secretary of the Board Rep. of security affairs
Name Du Jianguo Chen Kaiyue Liu Muya
Contact
add.
13/F Tower A World Trade Plaza No.9 Fuhong
Rd. Futian District Shenzhen
13/F Tower A World Trade Plaza No.9 Fuhong Rd. Futian
District Shenzhen
Tel. 0755-82027522 0755-82027522
Fax. 0755-83778311 0755-83778311
E-mail dujg@slkg1949.com chenky@slkg1949.com liumy@slkg1949.com
III. Others
1. Way of contact
Whether registrations address offices address and codes as well as website and email of the Company changed in reporting period or
not
√ Applicable □ Not applicable
Company Registration Address
8/F Tower B No.4 Building Software Industry Base South District Science &
Technology Park Xuefu Rd. Yuehai Street Nanshan District Shenzhen
Postal Code of Company Registration Address 518057
Company's Office Address 13/F Tower A World Trade Plaza No.9 Fuhong Rd. Futian District Shenzhen
Postal Code of the Company's Office Address 518033
Company Web Site www.slkg1949.com
Company E-mail szch@slkg1949.com
7
Query date of the interim notice on designated
website (if applicable)
2019-04-27
Search index of the interim notice on designated
website (if applicable)
Found more in the Notice of the Change of Company’s Office Address and
Contact Information released on Juchao Website (www.cninfo.com.cn)
2. Information disclosure and preparation place
Whether information disclosure and preparation place changed in reporting period or not
□ Applicable √ Not applicable
The newspaper appointed for information disclosure website for semi-annual report publish appointed by CSRC and preparation
place for semi-annual report have no change in reporting period found more details in Annual Report 2018.
3. Other relevant information
Whether other relevant information changed during the reporting period
√ Applicable □ Not applicable
(1) On February 18 2019 the company completed the industrial and commercial registration procedures for the
changes of company name business scope and registered capital and obtained the Business License renewed bythe Shenzhen Market Supervision Administration. The company name was changed from “Shenzhen ShenbaoIndustrial Co. Ltd.” to “Shenzhen Cereals Holdings Co. Ltd.”; the business scope newly added grain and oilcirculation and grain and oil reserve services businesses such as grain and oil reserves grain and oil trade grain
and oil processing etc. based on the original main business of the production research and development and sales
of food raw materials (ingredients) mainly based on deep processing of tea and natural plants; the registered
capital was changed from “RMB 496782303” to “RMB 1152535254”. For details please refer to the
“Announcement of the Company on Completion of Industrial and Commercial Registration for the Changes of
Company Name Business Scope and Registered Capital” disclosed on www.cninfo.com.cn on February 20 2019.
(2) Applied by the company and approved by the Shenzhen Stock Exchange the company's securities short name
has been changed from “Shenshenbao A Shenshenbao B” to “SZCH Shenliang B” since February 28 2019. For
details please refer to the “Announcement of the Company on Changing the Securities Short Name” disclosed on
www.cninfo.com.cn on February 28 2019.IV. Main accounting data and financial indexes
Whether information disclosure and preparation place changed in reporting period or not
√Yes □No
Reasons for retroactive adjustment or re-statement
Enterprise combined under the same control
The Period Same period of last year Changes over last
8
year
Before adjustment After adjustment After adjustment
Operating revenue (RMB) 4782167732.69 136721215.40 4434688646.82 7.84%
Net profit attributable to shareholders of
the listed Company (RMB)
203168850.61 -18246639.07 202779343.34 0.19%
Net profit attributable to shareholders of
the listed Company after deducting
non-recurring gains and losses (RMB)
198195100.05 -18884920.69 -18884920.69 1149.49%
Net cash flow arising from operating
activities (RMB)
-389429629.75 9795470.07 52861245.30 -836.70%
Basic earnings per share (RMB/Share) 0.1763 -0.0367 0.1759 0.23%
Diluted earnings per share (RMB/Share) 0.1763 -0.0367 0.1759 0.23%
Weighted average ROE 4.82% -1.95% 5.06% -0.24%
End of the Period
End of last year
Changes over end of
last year
Before adjustment After adjustment After adjustment
Total assets (RMB) 6432513092.25 1040484135.20 6468951793.87 -0.56%
Net assets attributable to shareholder of
listed Company (RMB)
4260480115.67 928673938.26 4172502535.11 2.11%
Total share capital of the Company on the trading day prior to disclosure:
Total share capital of the Company on the trading day prior to
disclosure (Share)
1152535254
Total diluted EPS calculated with the latest share capital
(RMB/Share)
0.1763
V. Difference of the accounting data under accounting rules in and out of China
1. Difference of the net profit and net assets disclosed in financial report under both IAS (International
Accounting Standards) and Chinese GAAP (Generally Accepted Accounting Principles)
√ Applicable □ Not applicable
In RMB
Net profit attributable to shareholders of listed
Company
Net assets attributable to shareholders of listed
Company
Current period Last period Period-end Period-begin
Chinese GAAP 203168850.61 202779343.34 4260480115.67 4172502535.11
Items and amount adjusted by IAS
Adjustment for other payable
fund of stock market
1067000.00 1067000.00
9
regulation
IAS 203168850.61 202779343.34 4261547115.67 4173569535.11
2. Difference of the net profit and net assets disclosed in financial report under both foreign accounting
rules and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable √ Not applicable
The Company has no above mentioned condition occurred in the period
3. Explanation on differences of the data under accounting standards in and out of China
□ Applicable √ Not applicable
VI. Items and amounts of extraordinary profit (gains)/loss
√ Applicable □ Not applicable
In RMB
Item Amount Note
Gains/losses from the disposal of non-current asset (including the write-off that
accrued for impairment of assets)
-4184.59
Governmental subsidy reckoned into current gains/losses (not including the subsidy
enjoyed in quota or ration according to national standards which are closely relevant
to enterprise’s business)
5463876.60
Profit and loss of assets delegation on others’ investment or management 3627466.27
Gains and losses from change of fair values of held-for-transaction financial assets and
financial liabilities except for the effective hedge business related to normal business
of the Company and investment income from disposal of trading financial assets and
liabilities and financial assets available for sale
28381.21
Switch-back of provision of impairment of account receivable and contract assets
which are treated with separate depreciation test
412500.00
Other non-operating income and expenditure except for the aforementioned items -3619767.49
Less: impact on income tax 702095.88
Impact on minority shareholders’ equity (post-tax) 232425.56
Total 4973750.56 --
Concerning the extraordinary profit (gain)/loss defined by Q&A Announcement No.1 on Information Disclosure for Companies
Offering Their Securities to the Public --- Extraordinary Profit/loss and the items defined as recurring profit (gain)/loss according to
the lists of extraordinary profit (gain)/loss in Q&A Announcement No.1 on Information Disclosure for Companies Offering Their
Securities to the Public --- Extraordinary Profit/loss explain reasons
□ Applicable √ Not applicable
In reporting period the Company has no particular about items defined as recurring profit (gain)/loss according to the lists of
10
extraordinary profit (gain)/loss in Q&A Announcement No.1 on Information Disclosure for Companies Offering Their Securities to
the Public --- Extraordinary Profit/loss
11
Section III. Summary of Company Business
I. Main businesses of the Company in the reporting period
Does the Company need to comply with disclosure requirements of the special industry?
No
During the reporting period the company accelerated the service convergence and synergetic development the
main business includes the circulation and service business of grain and oil reserves trade and processing and the
production research and development and sales of food raw materials (ingredients) mainly based on deep
processing of tea and natural plants.The grain and oil trade business are mainly rice wheat rice in the husk corn sorghum cooking oil and other
varieties of grain and oil. According to the market conditions and the needs of upstream and downstream enterprises
the above-mentioned grain and oil products purchased are independently traded. The wheat rice in the husk corn
barley and sorghum in the trade products are the unprocessed grain which are mainly used for the further processing
of food and feed for providing raw material distribution service to customers such as large traders feed and flour
processing enterprises in the industry ; rice flour and edible oil are the finished grain and oil of which the main
consumer groups are institutions organizations enterprises and public institutions food deep processing
enterprises and community residents.The grain and oil processing business are mainly the processing and sale of flour rice cooking oil and other
products. The company's flour brands and products include “Jinchangman” “Yingshanhong” and “Hongli” series
bread flour; “Clivia” and “Canna” series tailored flour for cakes and steamed bun; “Sunflower” high-gluten tailored
flour and biscuit tailored flour; “Feiyu” caramel treats tailored flour; “Yuejixiang” moon cake tailored flour and
other various small packages of flour. Rice products include “Shenliang Duoxi” “Guzhixiang” “Jinjiaxi”
“Runxiangliangpin” “Hexiang” “Shenliang Yushuiqing” etc. Cooking oil products include brands such as
“Shenliang Duoxi” “Shenliang Fuxi” “Hongli” and “Shenliang Yushuiqing” etc. Shenliang Duoxi
Changxiangdao Daohuaxiang Rice was selected as the first batch of “China Good Grain and Oil” products of the
National Grain Administration and it was the only selected product in Guangdong Province. The "Shenliang
fish-water friendship" has formed a series of rice noodles oil miscellaneous and special military supplies and
military civilian brands.The grain and oil reserve service business mainly provide dynamic grain and oil reserve services to local
governments in Shenzhen and provides local governments with market-oriented services such as grain and oil
reserves testing and rotation in the form of business holdings. With the advantages of brand reputation experience
management service facilities and information system accumulated in the grain and oil market we independently
organize and implement the procurement storage rotation sales and other activities of the local government
reserves of grain and oil and ensure the quality quantity and safety and other aspects of grain and oil reserves are in
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line with the requirements of the reserve grain and oil administrative authorities of local governments providing
local governments with high-quality dynamic grain and oil reserve services to assist local food security.The company provides grain and oil circulation services such as warehousing and logistics terminal loading and
unloading and quality inspection for upstream and downstream enterprises in the industrial chain. The Shenliang
Dongguan Grain Logistics Nodes Project construction and operation has been steadily advanced completed
storehouse capacity of 320000 tons (including 20000 tons of gas film warehouse) and put the 10000-ton wharf
berth into production which achieved the storage transfer volume reached 1.2 million tons and the terminal
transfer volume was more than 400000 tons; at the same time the CDE silos with 510000 tons of warehouse
capacity under construction food deep processing projects the terminal phase I and other projects are progressing
smoothly. After the project is completed it will become a comprehensive grain circulation service provider
integrating five functions including grain and oil terminal transfer reserve inspection and processing processing
industry and market transaction. The subordinate Shenliang Quality Inspection has more than 100 professional
equipments has obtained the qualification certificate of quality inspection organization and was awarded the
“Guangdong Shenzhen National Grain Quality Monitoring Station”. There were more than 4000 samples tested
during the reporting period. The company also provides logistics services and cold chain delivery services to its
customers. The above-mentioned integrated services of grain and oil supply chain and distribution is becoming an
increasingly important business segment of the company.The tea business mainly covers deep processing of tea sales of fine tea tea life experience food and beverage
and technology research and development etc. The main products include “Golden Eagle” instant tea powder tea
concentrate and other series of tea products; “Jufangyong” “Gutan” “Fuhaitang” series of tea products; “Tri-Well”
oyster sauce chicken essence seafood sauce and other series of condiments; “Shenbao” chrysanthemum tea lemon
tea herbal tea and other series of drinks.II. Major changes in main assets
1. Major changes in main assets
Major assets Note of major changes
Equity assets No major Change
Fixed assets No major Change
Intangible assets No major Change
Construction in progress Investment for node project engineering from Shenliang Dongguan Logistic increased
2. Main overseas assets
□ Applicable √ Not applicable
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III. Core Competitiveness Analysis
Does the Company need to comply with disclosure requirements of the special industry?
No
During the reporting period the company extended and expanded the development of grain and tea industry chain
deepened corporate reforms and strengthened the core competitive advantages of enterprises by optimizing
resource integration. The company stimulated the vitality of the enterprise through innovative implementation of
EVA performance appraisal mechanism promoted the sustainable development of the enterprise through the grain
logistics node project promoted the reform of the grain and oil reserve mechanism by adhering to the
marketization direction and improves the management efficiency by continuously leading the information
construction of the domestic grain industry prevented business risks by perfecting the management and control
mode and accumulated strengths in leapfrog development space by strengthening the corporate culture and talent
management and we have embarked on a sustainable development path of traditional enterprise self-innovation
and formed the company's unique competitiveness.
1. Management Efficiency Advantage
The core management team of the company has rich experience and stable structure and has a strong strategic
vision and pragmatic spirit. It has formed a set of effective system to promote the high-quality development of the
company by combining with the company’s actual development. The company vigorously promotes the innovation
and transformation of business models and actively promotes the transition from “trade-oriented enterprises” to
“service-oriented enterprises” and from “operational management and control” to “strategic management andcontrol”. In the business management and control the company builds a “four-in-one” management and controlmodel that the “business operations and fund management inventory management and quality management”
relatively separate and check and balance each other at the same time it strengthens risk management budget
management plan management contract management customer management and brand management and other
measures to effectively prevent operational risks. Through innovative talent management the company has
established an open talent team to meet the long-term development of enterprises. The company has innovated and
implemented the EVA performance appraisal mechanism and established a result-oriented incentive and restraint
assessment mechanism which effectively built the performance culture and stimulated the viability within theenterprise. The company insists on cultivating and advocating the corporate culture with “people-orientedperformance first excellent quality and harmony” as the core values combines the personal development goals of
employees with the corporate vision and enhances the cohesiveness and centripetal force of the enterprise.
2. Business model advantages
In terms of business layout and management the company has deepened and subdivided its target markets carried
out specialized operations in different areas of the grain and oil food industry chain embraced the Internet and
gradually built a “trinity” of multilevel product supply network of terminal grain and oil e-commerce catering and
distribution services and bulk grain and oil trading services. In terms of e-commerce the company vigorously
developed new formats of grain and actively promoted the development of new grain retail formats such as
14
“Internet + Grain” and “Community Automatic Selling Grain Supply Centers”. It has already had the B2C Grain
and Oil Network Direct Selling Platform “Doximi .com” and has opened channels on Tmall Jingdong Mall and
other e-commerce platforms to promote the online and offline deep integration of e-commerce platforms. In terms
of catering and distribution the company has built a one-stop distribution service platform for large-scale terminal
customers such as chain catering and canteens of thousands of people. Food and oil trading services the companybuilds a grain bulk commodity trading platform efficiently integrates business flow “Shenliang Cereals TradingNetwork” logistics and information flow improves circulation efficiency and provides spot trading financing
logistics quality inspection transaction information and other services for internal business units suppliers and
customers. The company gives full play to the traction role of major projects such as grain logistics nodes
continuously improves the construction of the grain supply chain system and promotes the sustainable development
of enterprises.
3. Research and development technology advantages
The company attaches great importance to transforming and upgrading the traditional industries by modern
technologies and actively introduces a new generation of information technologies such as internet of things
cloud computing big data and mobile internet into grain management. It takes the lead in promoting the
construction of “standardization mechanization informationization and harmlessness” of warehouse management
in the industry independently develops “grain logistics information system” (Shenliang GLS) applies RFID
technology and slip sheet equipment introduces intelligent robots and upgrades the grain depot operation
efficiency and management efficiency. The company has undertaken a number of national-level research projects
and multiple IT project results have won national provincial and municipal awards. More than 30 information
systems have been developed and run normally. As of now the company has 69 patents and 23 copyrights.
4. Advantages of quality control
The company gives full play to the advantages of products channels brands warehousing quality inspection etc.and truly provides good quality and safety products for the society. The company has established a quality control
system that is recognized by international large food and beverage enterprises. In the grain and oil business the
company’s subordinate enterprise SZCG Quality Test has the leading grain quality testing technology and
equipment in the domestic grain industry and has been officially incorporated into the national grain qualitysupervision and testing system and has been awarded the “Guangdong Shenzhen National Grain QualityMonitoring Station” by the State Administration of Grain. The advanced testing technology selects and checks the
grain from the source and timely and accurately checks the quality status of grain and oil in all aspects of
warehousing storage and delivery. Shenliang Quality Test has obtained the qualification certificate (CMA) for
testing and inspection institutions and it is the first among domestic peers to include pesticide residues heavy metal
pollutants mycotoxins and other hygienic indicators and taste value indicators in daily testing indicators and has
the detection ability of four types of indicators such as grain regular quality storage quality hygiene and eating
quality which can meet the relevant quality inspection requirements of grain and oil products and can accurately
analyze the nutritional ingredients and hygienic index of grain and determine its storage quality and eating quality.
5. Advantage of brand effect
The company regards “quality” as the cornerstone of establishing the enterprise brand and takes “good service” and
15
“livelihood guarantee” as the brand’s core value and has created a batch of “reliable grain” “reliable flour” and
“reliable oil” brand systems and has formed good brand effects. The company has been selected as one of the “Top
500 Chinese Service Enterprises” for five times and has won the “China Top Ten Grain and Oil Group” “China Top
100 Grain and Oil Enterprise” “China’s Most Respected Grain and Oil Enterprise” “National Top 100 MilitarySupply Stations” and “Key Agricultural Leading Enterprises in Guangdong Province” etc. and was awarded“Shenzhen Credit Enterprise” “Shenzhen Old Brand” “Leading Enterprises Strongly Support Grain and OilIndustrialization” etc. the market influence of “Shenliang Yushuiqing” “Shenliang Duoxi” “Guzhixiang”
“Clivia” “Shenliang Fuxi” and other brands has gradually expanded and the subordinate flour company has won
the title of “Shenzhen Old Brand” and Shenliang Duoxi Changxiangdao Daohuaxiang rice has been selected as the
first batch of “China Good Grain and Oil” products of the State Administration of Grain which is the only selected
product in Guangdong Province.
6. Comprehensive basic advantages
The company has a large-scale warehouse capacity in Shenzhen it is the main force of Shenzhen's municipal
grain reserves and the “rice bag” trusted by the public. At present its own grain storage capacity is about 400000
tons. Over the years on the basis of giving priority to ensuring the government's macroeconomic regulation and
control of grain and guaranteeing the grain security the company has been exploring the reform of the grain andoil reserve system and mechanism fully utilizing the operational characteristics and advantages of “dynamicrotation” and fully participating in market competition. In the process of market-oriented self-management the
company continues to optimize and innovate the grain storage logistics mode and the grain and oil distribution
docking mode so that the market competitiveness and regulation power have significantly enhanced the main
channel advantages of grain and oil supply have been further stabilized and the main position of grain and oil
industry has further highlighted. The company has established long-term extensive and diversified cooperative
relations with grain and oil traders processors and end customers and has built a wide business network andstable business channels. It has a high market share in the regional market and is rated as “Key AgriculturalLeading Enterprise of Guangdong Province” by the Department of Agriculture of Guangdong Province.16
Section IV. Discussion and Analysis of the Operation
I. Introduction
During the reporting period according to the annual key work and strategic planning objectives the company
focused on the post-restructuring integration development and corporate strategy reshaping and effectively
exerted the leading role of party building and implemented the reform requirements of “Double Hundred Actions”
throughout the various key work. The main economic indicators in the first half of the year have been completed
well the quality of main business development has been improved the construction of strategic projects has been
steadily advanced and the internal management and control level has been further improved.
1. Main business development
During the reporting period the company
based on its own advantages and industrial development used information technology innovated and opened up
the grain and oil products supply channels and trading methods created a new pattern for tea and food business
industry built a multi-group and multi-channel food supply chain and service network expanded the effective
supply of medium- and high-end grain oil and food and strived to meet people's needs of "quality diversity
nutrition health green and convenience" and promoted the transformation of grain and oil products from "eat
full" to "eat well".
As the “grain security” project and “rice bag” in Shenzhen the company completed the government grain and oil
reserve service with quality and quantity guaranteed during the reporting period the monthly average grain
reserve was 1.065 million tons and the monthly average oil reserve was 12100 tons which guaranteed the
sufficient grain and oil supply and stable price in Shenzhen through the balanced rotation of grain and oil.
During the reporting period the company integrated and reconstructed the deep processing of tea and natural
plants and allocated the staff. Through integration some businesses initially achieved stop loss or turnaround
goals.
2. Key projects
During the reporting period the construction and operation of the company's Dongguan grain logistics node
progressed smoothly. The construction of grain logistics and terminal supporting projects CDE warehouse project
food deep processing projects and the first phase of the wharf have been steadily advanced according to the plan
and progress. The international foods wharf loaded and unloaded 128 vessels with a turnover of 180000 tons. The
subordinate Dongguan logistics company promoted the establishment of safety production standardization and
achieved results and was awarded the second-level enterprise of safety production standardization.
During the reporting period the company's northeast grain source base project achieved “breaking ice”. In order
to speed up the implementation of the “North Grain to the South South Grain for Storage in North” strategy the
company set up the infrastructure office of the Northeast Grain Source Project to accelerate the construction of the
grain source base project. In June the main project of the first phase of the Northeast Grain Source Base Project
of 150000 tons has been started.
17
During the reporting period the company focused on promoting grain and oil platform transactions. At the 2
nd
China Grain Trade Conference “www.zglsjy.com.cn” further expanded the market influence and expanded new
customers to bid and list trading on the basis of serving internal customers. As of June the “www.zglsjy.com.cn”
had a trading volume of 2.2 million tons.
3. Continuous innovation and development
During the reporting period the company improved the efficiency of its operational management by increasing
the application of informatization innovation results to ensure the sustainable and healthy development of
enterprise. At present the innovative R&D system with Shenliang research institute as the core and with the
far-reaching data the product research and development center of flour company the doximi quality inspection
R&D department the technology center of reserve branch the tea product and technology research and
development center as the key supports has been focusing on the innovation and research and development of
informatization projects guided by the operational management needs and the development of the industry's most
cutting-edge technology planed and completed 14 informatization projects such as company management and
control and innovation management platform. Up to now the company has 69 patents and 23 software copyrights.
4. Other key tasks
(1) During the reporting period the company completed the organizational restructuring completed the changes
of company name business scope registered capital and securities short name and completed the reelection of
the board of directors the board of supervisors and senior management personnel. In accordance with the new
regulatory requirements and relevant regulations and procedures the company completed the combination and
revision of the internal systems to promote the improvement of corporate governance and further enhanced the
management effectiveness of the company through various effective measures.
(2) During the reporting period the company implemented the relevant requirements of the “Double Hundred
Actions” state-owned enterprise reform further expanded the compensation system and incentive and restraint
mechanism and completed the overall market-based selection and employment of the management teams of some
subordinate units and promoted the rotation exchange of key position talents and further optimized the
company's talent echelon construction.
(3) During the reporting period the company further strengthened fund management and control and in
accordance with the centralized management mode of “internal bank” funds promoted the online reporting
platform and effectively supervised the expense reimbursement capital expenditure and operating expenses of the
company headquarters and subordinate units. At the same time the company further improved the CBS fund
management information system function and fully opened the bank-corporate direct linkage of 9 banks to realize
the system supervision of banks and accounts. During the reporting period the company promoted the subordinate
units to optimize the structure of the debts and achieved remarkable results.
(4) During the reporting period the company built a new pattern of safe production further strengthened the
concept of safe development strictly implemented the responsibility system for production safety consolidated
the foundation of safety management investigated hidden dangers and immediately rectified them and became
the first enterprise in the municipal state-owned assets system to complete the “double” prevention mechanismsand safety standardization construction. The company closely followed the theme of “preventing risks eliminating18hidden dangers and restraining accidents” and has comprehensively launched the “Safe Production Month”activities.In the first half of 2019 the company achieved a total operating income of RMB 4782167700 an increase of
7.84% over the same period of the previous year (after restructuring); operating profit of RMB 235345700 an
increase of 7.38% over the same period of the previous year (after restructuring); net profit attributable to
shareholders of listed companies was RMB 203168900 an increase of 0.19% over the same period of the
previous year (after restructuring).II. Main business analysis
See the “I-Introduction” in “Discussion and Analysis of the Operation”
Y-o-y changes of main financial data
In RMB
Current period
Same period of last
year
Y-o-y
increase/de
crease
Reasons for changes
Operation
revenue
4782167732.69 4434688646.82 7.84%
Operation cost 4262101770.62 3962753163.26 7.55%
Sales expenses 112553742.74 120452104.30 -6.56%
Management
expenses
101397947.99 96324028.90 5.27%
Financial
expenses
8519731.85 -2173306.27 492.02%
Parts of the infrastructure of the node project from
Shenliang Dongguan Logistic has been put into
operation expensed interest increased in the year; the
exchange losses goes up on a y-o-y basis in the year
Income tax
expense
15485294.03 11869852.06 30.46%
Income tax expenses arising from settlement and
payment in the period increased from a year earlier.
R&D investment 4211474.91 2977062.54 41.46%
Strengthen R&D in the year and more investment
occurred.Net cash flow
arising from
operation
activities
-389429629.75 52861245.30 -836.70%
The cash received from labor service providing in first
half of the year declined and the cash paid for good
purchasing increased account payable declined.Net cash flow
arising from
investment
activities
-140751694.07 -307367061.47 54.21%
First the first half reserve grain and oil government
service income advance funds of this year has not
received; Second the increases of the grain and oil stock
caused the enlargement of operating activity cash
outflow.19
Net cash flow
arising from
financing
activities
88425677.74 66419850.49 33.13%
More loans from the bank the net cash flow from
financing activities changes due to the dividend
distribution
Net increase of
cash and cash
equivalent
-441723854.29 -184996984.35 -138.77%
Net cash flow from operation activities has changes on a
y-o-y basis
Major changes on profit composition or profit resources in reporting period
□ Applicable √ Not applicable
No major changes on profit composition or profit resources occurred in reporting period
Composition of main business
In RMB
Operating
revenue
Operating cost Gross profit ratio
Increase or
decrease of
operating revenue
over same period
of last year
Increase or
decrease of
operating cost
over same period
of last year
Increase or
decrease of gross
profit ratio over
same period of
last year
According to industries
Trading 4044141582.04 3880146561.03 4.06% 9.21% 8.86% 0.31%
According to products
Grain and oil
trading and
processing
4192557805.77 4020740766.97 4.10% 7.65% 7.37% 0.25%
According to region
Domestic sales 4770863075.53 4252262350.62 10.87% 7.76% 7.45% 0.26%
III. Analysis of the non-main business
√ Applicable □ Not applicable
In RMB
Amount
Ratio in total
profit
Note
Whether be
sustainable
Investment income 7167936.04 3.09% Unsustainable
Gains/losses of fair
value variation
28381.21 0.01% Unsustainable
Asset impairment -69231423.42 -29.88%
Reasons including: If the reserve for
depreciation of inventory has been calculated
for the sold inventory the reserve for
depreciation of inventory has been carried
forward to reduce the current main business
Unsustainable
20
cost.Non-operating
income
362252.46 0.16% Unsustainable
Non-operating
expense
3982019.95 1.72% Unsustainable
IV. Assets and liability
1. Major changes of assets composition
In RMB
End of current period End of period of last year
Ratio
changes
Notes of major changes
Amount
Ratio in
total
assets
Amount
Ratio in
total
assets
Monetary fund 189914485.39 2.95% 631638339.68 9.76% -6.81%
The cash out-flow for operation
activities purpose increased on a y-o-y
basis
Account
receivable
617831167.71 9.60% 473646886.64 7.32% 2.28%
The first half reserve grain and oil
government service income advance
funds of this year has not received.Inventory 3053593314.19 47.47% 2811802600.19 43.47% 4.00%
Increase grain and oil stock according
to demand
Investment
property
278173249.83 4.32% 282622184.92 4.37% -0.05%
Long-term equity
investment
73362651.19 1.14% 70999666.81 1.10% 0.04%
Fix assets 967835524.07 15.05% 993136743.51 15.35% -0.30%
Construction in
process
403629287.82 6.27% 186586135.06 2.88% 3.39%
Investment for the node project
engineering for Shenliang Dongguan
Logistic increased
Short-term loans 30590000.00 0.48% 91600000.00 1.42% -0.94%
Long-term loans 777384100.20 12.09% 516687791.66 7.99% 4.10%
Long-term loans from node project
engineering for Shenliang Dongguan
Logistic increased
2. Assets and liability measured by fair value
√ Applicable □ Not applicable
21
In RMB
Items
Amount at the
beginning period
Changes of
fair value
gains/losses
in this
period
Accumulative
changes of fair
value reckoned
into equity
Devaluatio
n of
withdrawi
ng in the
period
Amount
of
purchase
in the
period
Amount
of sale in
the
period
Amount in the
end of period
Financial assets
1. Trading financial assets
(excluding derivative financial
assets)
1124927.96 28381.21 1153309.17
Aforementioned total 1124927.96 28381.21 0.00 0.00 0.00 0.00 1153309.17
Financial liabilities 0.00 0.00 0.00
Whether there have major changes on measurement attributes for main assets of the Company in report period or not
□ Yes √No
3. The assets rights restricted till end of the period
Item
Original book
value
Book value at
period-end
Reasons for restriction
Intangible
assets
92328788.83 83859264.48
According to the long-term loan mortgage contract signed by the subsidiary
Dongguan Logistics and Agricultural Development Bank Dongguan Logistics
mortgaged the land DFGY (2014) DT No. 6 and the future built-up grain storage
and wharf supporting facilities and other buildings and structures on the ground
of No. 32 Jianshe Road Masan Village Machong Town Dongguan City to the
Agricultural Development Bank as collaterals for the loan. In addition according
to the loan contract “44191000-2018 (Dongben) Zi No.0100” signed by
Dongguan Logistics and Agricultural Development Bank Dongguan Logistics
mortgaged the land “Yue (2016) DGSBDCQ No. 0028527” to the Agricultural
Development Bank as a collateral for the loan.
Fixed
assets
400834811.27 371805770.40
Constructi
on in
process
76182755.87 76182755.87
Intangible
assets
45580368.97 35798712.71
According to the loan contract Yue DG 2017 NGDZ No. 006 signed by
Dongguan Food Industry Park and Bank of Communications Co. Ltd. Dongguan
Branch Dongguan Food Industry Park mortgaged two pieces of land “DFGY
(2009) DT No. 190” and “DFGY (2012) DT No. 152” to Bank of
Communications Co. Ltd. Dongguan Branch as collateral for the loan.
Total 614926724.94 567646503.46
V. Investment Analysis
1. Overall situation
√ Applicable □ Not applicable
Investment in reporting period (Yuan) Investment in the same period of last year Range
22
(Yuan)
244767336.46 0.00 100.00%
2. The major equity investment obtained in the reporting period
□ Applicable √ Not applicable
23
3. The major non-equity investment carrying in the reporting period
√ Applicable □ Not applicable
In RMB
Item
Investmen
t ways
Whether it is
the investment
for fixed
assets (Y/N)
Industry with
the
investment
involved
Amount input
in the period
Accumulated
actual input as of
the end of
reporting period
Capital
resources
Progress
Estimated
revenue
Income
accumulated
at end of the
reporting
period
Reasons for
failure to
achieve
planned
progress
and
expected
benefits
Disclosure
date (if
applicable)
Disc
losur
e
inde
x (if
appli
cabl
e)
Grain storage and wharf
complementary
engineering of Dongguan
Shenliang Logistics Co.Ltd.Self-build Y
Storage and
wharf
15220775.52 316826549.21
Owned
Funds and
Bank Loans
79.21%
43363000.00 62584926.78
-
Grain storage and wharf
complementary
engineering (Phase II) of
Dongguan Shenliang
Logistics Co. Ltd.Self-build Y
Storage and
wharf
179679302.57
Owned
Funds and
Bank Loans
100.00% -
Food logistics and wharf
matching project of
Dongguan Shenliang
Logistics Co. Ltd.Self-build Y
Warehouse
logistic
14141959.70 25213182.62
Owned
Funds
5.12% -
Warehouse logistic Self-build Y Warehouse 146326592.24 417764182.46 Owned 43.14% 37108900.00 -
24
distribution center of
Dongguan International
Food Industrial Park
Development Co. Ltd.
logistic Funds and
Bank Loans
Food processing project of
Dongguan Shenliang Oil
& Food Trade Co. Ltd.
Self-build Y
Flour
processing
36906337.84 76182755.87
Owned
Funds
26.09% -
Land use right Self-build N Construction 24179185.60 227922642.82
Owned
Funds
-
Total -- -- -- 236774850.90 1243588615.55 -- -- 80471900.00 62584926.78 -- -- --
4. Financial assets investment
(1) Securities investment
√ Applicable □ Not applicable
In RMB
Variety of
securities
Code of
securities
Short form of
securities
Initial
investme
nt cost
Accountin
g
measureme
nt model
Book value
at the
beginning of
the period
Changes in
fair value of
the current
profit and
loss
Cumulative
fair value
changes in
equity
Current
purchase
amount
Current
sales amount
Profit and
loss in the
Reporting
Period
Book value
at the end of
the period
Accounting
subject
Capital
Source
Domestic
and overseas
stock
000017 CBC-A 0.00
Measured
by fair
value
1124927.96 28381.21 0.00 0.00 0.00 28381.21 1153309.17
Trading
financial
assets
Shares
repaid from
debt
reorganizatio
n
Total 0.00 -- 1124927.96 28381.21 0.00 0.00 0.00 28381.21 1153309.17 -- --
25
Disclosure date of securities investment
approval of the Board
Not applicable
Disclosure date of securities investment
approval of the Shareholder Meeting (if
applicable)
Not applicable
(2) Derivative investment
□ Applicable √ Not applicable
The Company has no derivatives investment in the Period
VI. Sales of major assets and equity
1. Sales of major assets
□ Applicable √ Not applicable
The Company had no sales of major assets in the reporting period.
2. Sales of major equity
□ Applicable √ Not applicable
VII. Analysis of main Holding Company and stock-jointly companies
√ Applicable □ Not applicable
Particular about main subsidiaries and stock-jointly companies net profit over 10%
In RMB
Company name Type Main business Register capital Total assets Net Assets Operating revenue Operating profit Net profit
26
Shenzhen Cereals Group Co.Ltd
Subsidiary
Grain & oil
trading
processing、Grainand oil reserve
service
1530000000.00 5701507859.86 3727498207.39 4614789800.67 245205307.45 228906380.61
Shenzhen Flour Co. Ltd Subsidiary
Grain & oil
trading processing
30000000.00 958911346.84 270170166.90 1310067982.82 34184781.83 34160150.52
Shenzhen Hualian Grain & Oil
Trade Co. ltd.Subsidiary
Grain & oil
trading
31180000.00 961870154.63 225250597.47 1706053677.49 24141077.31 24141077.31
27
Particular about subsidiaries obtained or disposed in report period
□ Applicable √ Not applicable
Explanation on main holding/stock-jointly enterprise
Shenzhen Cereals Group Co. Ltd.- Business scope: general business items: grain and oil purchase and sales grain
and oil storage and supply of military grain; grain and oil and products management and processing (operated by
branches); operation and processing of feed (operated by outsourcing); investment in grain and oil feed logistics
projects; establishing grain and oil and feed trading market (including e-commerce market) (market license is also
available); storage (operated by branches); development operation and management of self-owned property;
providing management services for hotels; investing and setting up industries (specific projects are separately
declared); domestic trade; engaging in import and export business; E-commerce and information construction and
grain circulation service. Licensed business items: if the following items involved the approval and examination
which should be obtained the relevant approval documents shall be used for operation: information service
(internet information service only); general freight professional transport (cold storage and freshness
preservation ). Registered capital amounted as RMB 1530000000. Ended as the reporting period total assets
amounted as RMB 5701507859.86; net assets amounted as RMB 3727498207.39; the equity attributable to
shareholder of parent company was RMB 3541962524.81; during the reporting period business revenue
achieved RMB 4614789800.67 net profit was RMB 228906380.61 and the net profit attributable to parent
company was RMB 215226820.22.Shenzhen Flour Co. Ltd. business scope: hardware and electrical equipment chemical products (excluding
hazardous chemicals and restricted items) auto parts purchase and sales of construction materials; self-operated
import and export business (carry out according to the provisions of the registration certificate SMGDZZ No. 76);
domestic trade (excluding franchise exclusive control monopoly commodities); wheat wholesale and retail; flour
processing and production. Register capital was 30000000 Yuan. Ended as this period total assets amounted as
958911346.84 Yuan and net assets amounting to 270170166.90 Yuan shareholders’ equity attributable to
parent Company is 270170166.90 Yuan; in the reporting period achieved operation income net profit and net
profit attributable to parent Company as 1310067982.82 Yuan 34160150.52Yuan and 34160150.52 Yuan
respectively.Shenzhen Hualian Grain and Oil Trade Co. Ltd. business scope: general operational projects include domestic
trade (except for projects that laws administrative regulations and decisions of the State Council require approval
before registration); engaging in import and export business (except for projects prohibited by laws
administrative regulations and decision of the State Council restricted projects can be operated only after
obtaining permission); online feed sales; information consultation self-owned housing leasing (excluding talent
agency services and other restricted items); international freight forwarding domestic freight forwarding (can
only be operated after being approved by the transport department if laws administrative regulations State
Council decision require the approval of transport department); license business projects include purchase and sale
of grain and oil online sales of grain and oil; information service business (internet information service business
only). Register capital was RMB 31180000. Ended as this period total assets amounted as RMB 961870154.63
and net assets amounting to RMB 225250597.47 shareholders’ equity attributable to parent Company is RMB
28
225250597.47; in the reporting period achieved operation income net profit and net profit attributable to parent
Company as RMB 1706053677.49 RMB 24141077.31 and RMB 24141077.31 respectively.
VIII. Structured vehicle controlled by the Company
□ Applicable √ Not applicable
IX. Prediction of business performance from January – September 2019
Estimation on accumulative net profit from the beginning of the year to the end of next report period to be loss probably or the
warning of its material change compared with the corresponding period of the last year and explanation on reason
□ Applicable √ Not applicable
X. Risks and countermeasures
1. Affected by a series of unfavorable factors such as Sino-US trade friction and African swine fever the overall
environment of the grain feed food and other domestic industries has been greatly affected and the company's
operations are facing greater pressure. In contrast to the annual work objectives and requirements there is still a
gap between the company's work and the annual mission plan requirements. In the second half of the year the
company will focus on deepening enterprise reform firming the strategic projects construction improving
operational efficiency concentrating on innovation-driven leading and expanding business channels to ensure the
completion of annual work goals.
2. Faced with the changing consumption trends in recent years and the increasing scale of the company's business
and the more complex business structure the company's reserves in professional talents key talents and
comprehensive talents are relatively insufficient so the company showed slight weakness in innovation ability and
contingency ability when cultivating new business and facing new field. The company will focus on strategic and
business development needs innovate talent training accelerate talent introduction strengthen talent echelon
construction and innovative talent reserves open up development channels for employees create career
development opportunities and provide kinetic energy for the company's sustainable development.29
Section V. Important Events
I. Annual General Meeting and extraordinary shareholders general meeting held in this
period
1. AGM in the period
Sessions Type
Investor
participati
on (%)
Opening date Disclosure date Disclosure index
The First Interim
Shareholders
General Meeting
of 2019
Interim
Shareholders
General Meeting
63.83% 2019-01-18 2019-01-19
Resolution Notice of The First
Interim Shareholders General
Meeting of 2019 of Shenzhen
Shenbao Industrial Co. Ltd.(Notice No.: 2019-10) released on
Juchao website dated 19 Jan. 2019
The Second
Interim
Shareholders
General Meeting
of 2019
Interim
Shareholders
General Meeting
63.83% 2019-01-30 2019-01-31
Resolution Notice of The Second
Interim Shareholders General
Meeting of 2019 of Shenzhen
Shenbao Industrial Co. Ltd.(Notice No.: 2019-14) released on
Juchao website dated 31 Jan. 2019
The Thrid Interim
Shareholders
General Meeting
of 2019
Interim
Shareholders
General Meeting
63.82% 2019-02-21 2019-02-22
Resolution Notice of The Third
Interim Shareholders General
Meeting of 2019 of Shenzhen
Shenbao Industrial Co. Ltd.(Notice No.: 2019-21) released on
Juchao website dated 22 Feb. 2019
2018 Annual
general meeting
Annual general
meeting
63.80% 2019-05-20 2019-05-21
Resolution Notice of AGM 2018 of
Shenzhen Shenbao Industrial Co.Ltd. (Notice No.: 2019-45) released
on Juchao website dated 21 May
2019
2. Request for extraordinary general meeting by preferred stockholders whose voting rights restore
□ Applicable √ Not applicable
II. Profit distribution plan and capitalizing of common reserves plan for the Period
□ Applicable √ Not applicable
30
The Company plans not to carried out distribution of cash dividend bonus shares and share converted from capital reserve either for
the half year
III. Commitments completed in Period and those without completed till end of the Period
from actual controller shareholders related parties purchaser and companies etc.
□ Applicable √ Not applicable
There are no commitments completed in Period and those without completed till end of the Period from actual controller
shareholders related parties purchaser and companies etc.IV. Appointment and non-reappointment (dismissal) of CPA
Whether the financial report has been audited or not
□Yes √No
The financial report has not been audited
V. Explanation from Board of Directors and Supervisory Committee for “Qualified Opinion”
that issued by CPA
□ Applicable √ Not applicable
VI. Explanation from the BOD for “Qualified Opinion” of last year
□ Applicable √ Not applicable
VII. Bankruptcy reorganization
□ Applicable √ Not applicable
No bankruptcy reorganization for the Company in end of this period
VIII. Lawsuits
Significant lawsuits and arbitration
□ Applicable √ Not applicable
No significant lawsuits and arbitration occurred in the reporting period
Other lawsuits
√ Applicable □ Not applicable
Lawsuits (arbitration)
Amount
involved
Resulted an accrual
liability (Y/N)
Progress
Trial result and
influence
Execution of
judgment
Disclo
sure
Disclo
sure
31
(in 10
thousand
Yuan)
date index
During the reporting
period the litigation
matters mainly
including: Disputes
over sales contract
principal-agent
contract disputes
infringement disputes
loan contract disputes
and so on
5291.98
No the event is related
to routine operation of
the Company with
minor amount. Judging
from the progress of the
case relevant litigation
do not constitute a
significant impact on the
Company
Relevant
litigation-related
matters are executed
by legal dept. Of the
Company and external
laws firms. The
matters will litigation
involved are carry out
the promotion
according to relevant
process currently.Judging from
the litigation it
does not have a
significant
impact on the
Company
In processing
Not
applic
able
Not
applic
able
IX. Penalty and rectification
□ Applicable √ Not applicable
No penalty and rectification for the Company in reporting period.X. Integrity of the Company and its controlling shareholders and actual controllers
□ Applicable √ Not applicable
XI. Implementation of the Company’s stock incentive plan employee stock ownership plan or
other employee incentives
□ Applicable √ Not applicable
During the reporting period the Company has no stock incentive plan employee stock ownership plan or other employee incentives
that have not been implemented.XII. Major related transaction
1. Related transaction with routine operation concerned
□ Applicable √ Not applicable
No related transaction occurred in the period with routine operation concerned
2. Assets or equity acquisition and sales of assets and equity
□ Applicable √ Not applicable
No related transaction concerning the asses or equity acquisition and sold at period-end
32
3. Related transaction of foreign investment
□ Applicable √ Not applicable
No related transaction of foreign investment occurred at period-end
4. Related credits and liabilities
□ Applicable √ Not applicable
No related credits and liabilities occurred in period
5. Other major related transaction
□ Applicable √ Not applicable
No other major related transaction in the Period
XIII. Non-operational fund occupation from controlling shareholders and its related party
□ Applicable √ Not applicable
No non-operational fund occupation from controlling shareholders and its related party in period.XIV. Significant contract and implementations
1. Trusteeship contract and leasing
(1) Trusteeship
□ Applicable √ Not applicable
No trusteeship for the Company in reporting period
(2) Contract
□ Applicable √ Not applicable
No contract for the Company in reporting period
(3) Leasing
□ Applicable √ Not applicable
No leasing in the Period
33
2. Major Guarantee
√ Applicable □ Not applicable
(1) Guarantee
In 10 thousand Yuan
External Guarantee (not including guarantees to subsidiaries)
Name of the
Company
guaranteed
Related
Announce
ment
disclosure
date
Guarant
ee limit
Actual date of happening
(Date of signing
agreement)
Actual
guarantee
limit
Guarantee type
Guarant
ee term
Complete
implemen
tation or
not
Guarante
e for
related
party
Guarantee between the Company and subsidiary
Name of the
Company
guaranteed
Related
Announce
ment
disclosure
date
Guarant
ee limit
Actual date of happening
(Date of signing
agreement)
Actual
guarantee
limit
Guarantee type
Guarant
ee term
Complete
implemen
tation or
not
Guarante
e for
related
party
Dongguan
Shenliang
Logistics Co. Ltd.
27300 2015-07-13 21281
Joint liability
guaranty
8 years N Y
Dongguan
Shenliang
Logistics Co. Ltd.
10200 2016-12-21 5090
Joint liability
guaranty
5 years N Y
Dongguan
International Food
Industrial Park
Development Co.
Ltd.
39168 2018-07-27 24663
Joint liability
guaranty
14
years
N Y
Shenzhen Shenbao
Huacheng Science
and Technology
Co. Ltd.
3000 2018-07-26 3000
Joint liability
guaranty
1 year N Y
Dongguan
Shenliang
Logistics Co. Ltd.
21930 2019-01-25 250
Joint liability
guaranty
12
years
N Y
Dongguan
Shenliang Oil &
Food Trade Co.
Ltd.
11883 2019-04-19 1852
Joint liability
guaranty
8 years N Y
Total amount of approving 33813 Total amount of actual 10680
34
guarantee for subsidiaries in
report period (B1)
occurred guarantee for
subsidiaries in report period
(B2)
Total amount of approved
guarantee for subsidiaries at the
end of reporting period (B3)
113481
Total balance of actual
guarantee for subsidiaries at
the end of reporting period
(B4)
56136
Guarantee between the subsidiaries
Name of the
Company
guaranteed
Related
Announce
ment
disclosure
date
Guarant
ee limit
Actual date of happening
(Date of signing
agreement)
Actual
guarantee
limit
Guarantee type
Guarant
ee term
Complete
implemen
tation or
not
Guarante
e for
related
party
Total amount of guarantee of the Company (total of three above mentioned guarantee)
Total amount of approving
guarantee in report period
(A1+B1+C1)
33813
Total amount of actual
occurred guarantee in report
period (A2+B2+C3)
10680
Total amount of approved
guarantee at the end of report
period (A3+B3+C2)
113481
Total balance of actual
guarantee at the end of report
period (A4+B4+C4)
56136
The proportion of the total amount of actually guarantee in the net
assets of the Company (that is A4+ B4+C4)
13.18%
Including:
Amount of guarantee for shareholders actual controller and its
related parties (D)
0
The debts guarantee amount provided for the guaranteed parties
whose assets-liability ratio exceed 70% directly or indirectly (E)
53136
Proportion of total amount of guarantee in net assets of the Company
exceed 50% (F)
0
Total amount of the aforesaid three guarantees (D+E+F) 53136
Explanation on compound guarantee
Nil
(2) Illegal external guarantee
□ Applicable √ Not applicable
No illegal external guarantee in the period
3. Other material contracts
□ Applicable √ Not applicable
No other material contracts in the period.35
XV. Social responsibility
1. Major environment protection
The listed Company and its subsidiary whether belong to the key sewage units released from environmental protection department
No
The company and its subsidiaries do not belong to the key pollutant discharge units announced by the environmental protection
department.
2. Execution of social responsibility of targeted poverty alleviation
(1) Plan of targeted poverty alleviation
In 2019 Shenzhen Cereals Holdings continues to use the socialism with Chinese characteristics of Xi Jinping new
era of as a guide to carry out the targeted poverty alleviation work to help Guilin Village Yidu Town Longchuan
County Heyuan City in accordance with spirit of the document of “Implementation Opinions on the Three-YearPlan for Poverty Alleviation in the New Period (Yuefa [2016] No. 13)” of the Guangdong Provincial Party
Committee and the Provincial Government the overall goal and task of Guilin Village's targeted poverty
alleviation is to achieve the goal of making the relatively poor population be free from worry of food and clothing
and be guaranteed with compulsory education basic medical care and housing security by the end of 2019 and
making the indicators of main areas of basic public services be equivalent to the provincial average and getting
52 households and 144 people all out of poverty. In order to implement the poverty alleviation work the residency
poverty alleviation work team of Shenzhen Cereals Holdings adopted the following effective assistance measures
under the correct leadership of the company's party committee: First in the aspect of industrial assistance. By
holding training courses participating in exhibitions to help the selling of tea providing public welfare jobs
handling small loans encouraging migrant workers guiding the cultivation of tea increasing the planting area
using the “reward for compensation” financial funds and Shenliang help fund investment dividends and other
various new forms and new methods to help poor households and village collectives to increase their income. The
second is to continue to increase the support of medical care and education so as to solve the worries of poor
households. Third in terms of village infrastructure the village service center project and the water purification
project will be put into use by the end of 2019.
(2) Summary of semi-annual targeted poverty alleviation
In the first half of 2019 Shenzhen Cereals Holdings invested RMB 1000900 in poverty alleviation funds (not
including consolation money and goods and materials) which is used to improve infrastructure construction
increase the collective economic income of the village improve the rural living environment and support medical
care and education etc.Performance and effect: First in the aspect of industrial assistance carried out poverty alleviation work in the mode
36
of “company + cooperative + farmer + base” guided the large tea farmers to actively buy tea from more than 20
poor households with working ability which solved the marketing problem of poor households’ tea to a certainextent Stimulate the production enthusiasm of poor households; utilized the “substituting and complementing thefinancial funds with rewards” to guide the 20 poor households with labor capacity to invest in the Nanyuewang
Company and the Aodingfeng Tea Cooperative it is estimated that by the end of 2019 the dividends of these two
investments will reach RMB 98300 with an average income of RMB 4914 per household; At the same time
Shenzhen Cereals Holdings appropriated RMB 500000 to help the Guilin Village Committee invest in the
Nanyuewang Company which can bring about RMB 60000 of dividends every year and effectively increase the
collective income. Second it organized the tea-planting farmers to participate in the Shenzhen Spring Tea Expo
and a variety of other trade fairs which not only strengthened exchange with peers but also enhanced the
popularity of "Guilin Tea". Third in the improvement of village infrastructure and public services Shenzhen
Cereals Holdings pre-invested RMB 790000 to help Guilin Village build a village service center to effectively
improve the environment of the village committee office and villagers' activities the company has already paid
RMB 390000. The fourth is to invest RMB 77600 in medical care and education to help the villagers living in
Guilin Village to handle new rural cooperative medical insurance strengthen medical security and reduce
villagers' burden in preventing and curing disease; applied for subsidy of RMB 33500 from the Shenzhen Charity
Federation for the children of 5 poor households which effectively reduced the economic burden in schooling of
poor households; invested RMB 10800 to install LED display and toilet door partition clean the campus
environment and purchase cleaning tools for Guilin Primary School. In the first half of 2019 there were 52 poor
households with 144 people in Guilin Village all of which have reached poverty alleviation conditions.
(3) Performance of targeted poverty alleviation
Target
Measurement
unit
Numbers/ implementation
i. Overall —— ——
Including:1. fund
10 thousand
yuan
100.09
2. Material discount
10 thousand
yuan
1.08
3.number of poverty-stricken populations eliminating
poverty with card for archives established
Person 144
ii. Invested by specific project —— ——
1.Industrial development poverty —— ——
Including: 1.1Type —— Poverty Alleviation by Asset Income
1.2 numbers of industrial development poverty Number 1
1.3Amount input 10 thousand 50
37
yuan
1.4number of poverty-stricken population eliminating
poverty with card for archives established
Person 7
2.Transfer employment —— ——
Including: 2.1 Amount input for vocation skills training
10 thousand
yuan
0
2.2 Number of vocation skills training Person-time 0
2.3 Number of poverty-stricken populations achieving
employment with card for archives established
Person 0
3.Relocation the poor —— ——
Including: 3.1 Number of employed persons from relocated
households
Person 0
4.Education poverty —— ——
Including: 4.1 Amount input for subsidizing the impoverished
students
10 thousand
yuan
0
4.2Number of subsidized poor student s Person 0
4.3Amount input for improving the education resources in
poverty-stricken areas
10 thousand
yuan
1.08
5.Health poverty alleviation —— ——
Including: 5.1 Amount input for medical and health resources in
poverty-stricken areas
10 thousand
yuan
7.76
6.Ecological protection and poverty alleviation —— ——
Including: 6.1 Type ——
Environmental Cleaning and
Maintenance
6.2Amount input
10 thousand
yuan
1.51
7.Fallback protection —— ——
Including: 7.1 Amount input for Three Stay Behind persons
10 thousand
yuan
0
7.2Number of Three Stay Behind persons help Person 0
7.3Amount input for poor disabled persons
10 thousand
yuan
0
7.4Number of poor disabled persons help Person 0
8.Social poverty alleviation —— ——
Including: 8.1Amount of the poverty alleviation cooperation between
the Eastern and Western regions
10 thousand
yuan
0
8.2Amount for targeted poverty alleviation 10 thousand 0
38
yuan
8.3Amount for the poverty alleviation public welfare fund
10 thousand
yuan
0
9.Other —— ——
Including: 9.1. number of items Number 3
9.2. Amount input
10 thousand
yuan
39.74
9.3. number of poverty-stricken populations eliminating
poverty with card for archives established
Person 139
iii. Awards (content and grade) —— ——
Outstanding contributions to poverty
alleviation for 2016-2018 in Heyuan -
Li Suiyang
(4) Follow-up of targeted poverty alleviation
2019 is a key year for winning the three-year tack on targeted poverty alleviation SZCG will continue to take Xi
Jinping’s socialism with Chinese characteristics as a guide and take related poverty alleviation policies of
governments at all levels as a gist concentrate efforts strengthen measures promote poverty alleviation work in
an orderly manner promote the industry development of Guilin Village consolidate the results of poverty
alleviation bring all poverty-stricken households out of poverty. The plan is as follows: First continue to do a
good job in precision assistance encourage 20 poor households who have the ability to work to go out as migrant
workers continue to implement the dividend income of investing in Nanyuewang and Aodingfeng for the poor
households and village collectives and continue to explore new projects to increase the income of poor
households from various aspects fully implement the “two no-worries three guarantees” policy achieve the
"eight have" standard and effectively implement the measures to support medical care and education. The second
is to continue to follow the village infrastructure it plans to renovate three safe drinking water facilities for
villagers and strive to complete the construction of the village service center this year. Third further promote the
Guilin Tea to go out and increase the brand awareness of the product through the participation of tea fairs so as to
increase the industrial income and increase the production enthusiasm. The fourth is to combine the policies of the
poverty alleviation department develop the tea industry in Guilin according to local conditions continue to
explore the model of “planting tea + tourism” and form a long-term and comprehensive poverty alleviation
mechanism. Fifth comprehensively do a good job in the smooth docking of “precise poverty alleviation” and
“rural revitalization” and further consolidate the effectiveness of poverty alleviation.XVI. Other major events
□ Applicable √ Not applicable
39
There are no other important events to be explained in the company's reporting period.XVII. Significant event of subsidiary of the Company
□ Applicable √ Not applicable
40
Section VI. Changes in Shares and Particulars about Shareholders
I. Changes in Shares
1. Changes in shares
In Share
Before the Change Increase/Decrease in the Change (+ -) After the Change
A mount
Proporti
on
New
shares
issued
Bon
us
shar
es
Capitaliz
ation of
public
reserve
Others Subtotal A mount Proportion
I. Restricted shares 684821396 59.42% 0 0 0 44180 44180 684865576 59.42%
1. State-owned shares 0 0.00% 0 0 0 0 0 0 0.00%
2. State-owned corporate
shares
669184735 58.06% 0 0 0 15384832 15384832 684569567 59.39%
3. Other domestic shares 15583326 1.35% 0 0 0 -15358431 -15358431 224895 0.02%
Including: Domestic legal
person’s shares
15384832 1.33% 0 0 0 -15384832 -15384832 0 0.00%
Domestic nature
person’s shares
198494 0.02% 0 0 0 26401 26401 224895 0.02%
4. Foreign shares 53335 0.01% 0 0 0 17779 17779 71114 0.01%
Including: Foreign
corporate shares
0 0.00% 0 0 0 0 0 0 0.00%
overseas nature
person’s share
53335 0.01% 0 0 0 17779 17779 71114 0.01%
II. Un-restricted shares 467713858 40.58% 0 0 0 -44180 -44180 467669678 40.58%
1. RMB common shares 415964578 36.09% 0 0 0 -44180 -44180 415920398 36.09%
2. Domestically listed
foreign shares
51749280 4.49% 0 0 0 0 0 51749280 4.49%
3. Foreign listed foreign
shares
0 0.00% 0 0 0 0 0 0 0.00%
4. Other 0 0.00% 0 0 0 0 0 0 0.00%
III. Total shares 1152535254 100.00% 0 0 0 0 0 1152535254 100.00%
Reasons for share changed
√Applicable □Not applicable
1. During the reporting period natural of the shares held by shareholder Agricultural Products are changed to state-owned corporate
shares instead of domestic legal person’s shares the state-owned corporate shares in restricted shares has 15384832 shares increased
41
while 15384832 shares decreased in other domestic shares.
2. During the reporting period the shares are lock-in for changes after the former directors supervisors and senior executives leaving
the office. The un-restricted shares has 44180 decreased while 44180 shares increased in restricted shares.
Approval of share changed
□ Applicable √ Not applicable
Ownership transfer of share changed
□ Applicable √ Not applicable
Progress of shares buy-back
□ Applicable√Not applicable
Implementation progress of the reduction of repurchases shares by centralized bidding
□ Applicable√Not applicable
Influence on the basic EPS and diluted EPS as well as other financial indexes of net assets per share attributable to common
shareholders of Company in latest year and period
□ Applicable √ Not applicable
Other information necessary to disclose or need to disclosed under requirement from security regulators
□ Applicable √ Not applicable
2. Changes of restricted shares
√Applicable □Not applicable
Shareholder
Shares restricted
at period-begin
Restrict shares
released in
current period
Restricted shares
increased in the
current period
Shares
restricted at
period-end
Restriction
causes
Date for shares
released
Yan Zesong 53335 0 17779 71114
Shares lock-in
for executives
2019-8-22
Zheng Yuxi 49500 0 16500 66000
Shares lock-in
for executives
2019-8-22
Yao Xiaopeng 33289 0 11096 44385
Shares lock-in
for executives
2019-8-22
Lin Hong 30937 0 10313 41250
Shares lock-in
for executives
2019-8-22
Li Yiyan 30937 0 10313 41250
Shares lock-in
for executives
2019-8-22
Wang Zhiping 21037 0 7013 28050
Shares lock-in
for executives
2019-8-22
Fan Zhiqing 2970 0 990 3960
Shares lock-in
for executives
2019-8-22
Li Fang 29824 29824 -29824 0
Shares lock-in
for executives
2019-3-11
Total 251829 29824 44180 296009 -- --
42
II. Securities issuance and listing
□ Applicable √ Not applicable
III. Amount of shareholders and particulars about shares holding
In Share
Total common stock
shareholders in reporting
period-end
54313
Total preference shareholders
with voting rights recovered at
end of reporting period (if
applicable) (found in note8)
0
Particulars about shares held above 5% by common shareholders or top ten common shareholders
Full name of Shareholders
Nature of
shareholder
Proporti
on of
shares
held
Total common
shares hold at
the end of
report period
Changes
in report
period
Amount of
restricted
common
shares held
Amount of
un-restricted
common
shares held
Number of
share
pledged/frozen
State
of
share
Amount
Shenzhen Fude State-Owned
Capital Operation Co. Ltd.
State-owned
legal person
63.79% 735237253 0 669184735 66052518
Shenzhen Agricultural Products
Co. Ltd
State-owned
legal person
8.23% 94832294 0 15384832 79447462
Sun Huiming
Domestic
nature
person
0.30% 3436462 0 0 3436462
Bohai Securities Co. Ltd.
State-owned
legal person
0.26% 2980500 2980500 0 2980500
Hu Xiangzhu
Domestic
nature
person
0.24% 2800000 170000 0 2800000
Lin Junbo
Domestic
nature
person
0.17% 2000000 542100 0 2000000
Central Huijin Asset
Management Co. Ltd.State-owned
legal person
0.13% 1472625 0 0 1472625
Li Qian
Domestic
nature
person
0.11% 1309661 30470 0 1309661
Li Yongqi
Domestic
nature
0.10% 1099205 -9000 0 1099205
43
person
Cai Congda
Domestic
nature
person
0.09% 1080051 1080051 0 1080051
Strategy investors or general corporation
comes top 10 common shareholders due to
rights issue (if applicable) (see note 3)
N/A
Explanation on associated relationship among
the aforesaid shareholders
Shenzhen SASAC directly holds 100% equity of Fude Capital and holds 34% of
Agricultural Products indirectly through Fude Capital; the Company was not aware
of any related relationship between other shareholders above and whether they
belonged to parties acting in concert as defined by the Acquisition Management
Method of Listed Company.Particular about top ten common shareholders with un-restrict shares held
Shareholders’ name
Amount of un-restrict common shares held at
Period-end
Type of shares
Type Amount
Shenzhen Fude State-Owned Capital
Operation Co. Ltd.
79447462
RMB common
shares
79447462
Shenzhen Agricultural Products Co. Ltd 66052518
RMB common
shares
66052518
Sun Huiming 3436462
Domestically
listed foreign
shares
3436462
Bohai Securities Co. Ltd. 2980500
RMB common
shares
2980500
Hu Xiangzhu 2800000
RMB common
shares
2800000
Lin Junbo 2000000
RMB common
shares
2000000
Central Huijin Asset Management Co. Ltd. 1472625
RMB common
shares
1472625
Li Qian 1309661
RMB common
shares
1309661
Li Yongqi 1099205
RMB common
shares
1099205
Cai Congda 1080051
RMB common
shares
1080051
Expiation on associated relationship or
consistent actors within the top 10 un-restrict
shareholders and between top 10 un-restrict
Shenzhen SASAC directly holds 100% equity of Fude Capital and holds 34% of
Agricultural Products indirectly through Fude Capital; the Company was not aware
of any related relationship between other shareholders above and whether they
44
shareholders and top 10 shareholders belonged to parties acting in concert as defined by the Acquisition Management
Method of Listed Company.
Explanation on top 10 shareholders involving
margin business (if applicable) (see note 4)
Shareholder Li Yongqi holds 1097205 shares of the Company under customer
credit trading secured securities account through Xingye Securities Co. ltd common
account holds 2000 shares and 1099205 shares are held by Li in total at end of the
Period. During the reporting period the credit trading secured securities account has
9100 shares decreased and 100 shares increased in the common account shares
held by Li are decreased 9000 shares in total.Whether top ten common stock shareholders or top ten common stock shareholders with un-restrict shares held have a buy-back
agreement dealing in reporting period
□ Yes √ No
The top ten common stock shareholders or top ten common stock shareholders with un-restrict shares held of the Company have no
buy-back agreement dealing in reporting period.IV. Change of controlling shareholder or actual controller
Change of controlling shareholders during the reporting period
□ Applicable √ Not applicable
The Company had no changes of controlling shareholders in reporting period
Changes of actual controller in reporting period
□ Applicable √ Not applicable
The Company had no changes of actual controller in reporting period
45
Section VII. Preferred Stock
□ Applicable √ Not applicable
The Company had no preferred stock in the Period.46
Section VIII. Particulars about Directors Supervisor and Senior
Executives
I. Changes of shares held by directors supervisors and senior executives
□ Applicable √ Not applicable
No change of shares held by directors supervisors and senior executives found more details in Annual Report 2018.II. Changes of directors supervisors and senior executives
√ Applicable □ Not applicable
Name Position Type Date Causes
Zhu Junming Party Secretary Chairman Election 2019-02-21 Election of the Board of Directors
Hu Xianghai
Deputy party secretary Director
GM
Election 2019-02-21 Election of the Board of Directors
Lu Qiguang Deputy party secretary Director Election 2019-02-21 Election of the Board of Directors
Jin Zhenyuan Director CFO Election 2019-02-21 Election of the Board of Directors
Zhao Rubing Independent director Election 2019-02-21 Election of the Board of Directors
Bi Weimin Independent director Election 2019-02-21 Election of the Board of Directors
Liu Haifeng Independent director Election 2019-02-21 Election of the Board of Directors
Wang Huimin
SCID Chairman of supervisory
committee
Election 2019-02-21
Election of the Board of
Supervisors
Liu Ji Supervisor Election 2019-02-21
Election of the Board of
Supervisors
Qian Wenying Supervisor Election 2019-02-21
Election of the Board of
Supervisors
Zheng Shengqiao Staff supervisor Election 2019-02-21 Election of workers' Congress
Du Jianguo Staff supervisor Election 2019-02-21 Election of workers' Congress
Cao Xuelin
Deputy GM
Appointment 2019-02-21
Appointment of the Board of
Directors
Ye Qingyun
Deputy GM Appointment
2019-02-21
Appointment of the Board of
Directors
Dai Bin
Deputy GM Appointment
2019-02-21
Appointment of the Board of
Directors
Wang Fangcheng Secretary of the Board Appointment 2019-02-21 Appointment of the Board of
47
Directors
Zheng Yuxi Party Secretary Chairman
Term of office
expires and
leave the office
2019-02-21
Term of office expires and is not
renewed
Zhang Guodong Director
Term of office
expires and
leave the office
2019-02-21
Term of office expires and is not
renewed
Fan Zhiqing Independent director
Term of office
expires and
leave the office
2019-02-21
Term of office expires and is not
renewed
Wu Shuping Independent director
Term of office
expires and
leave the office
2019-02-21
Term of office expires and is not
renewed
Chen Cansong Independent director
Term of office
expires and
leave the office
2019-02-21
Term of office expires and is not
renewed
Yan Zesong Director GM
Term of office
expires and
leave the office
2019-02-21
Term of office expires and is not
renewed
Li Yiyan
Director Deputy GM Secretary
of the Board
Term of office
expires and
leave the office
2019-02-21
Term of office expires and is not
renewed
Lin Hong
Chairman of supervisory
committee
Term of office
expires and
leave the office
2019-02-21
Term of office expires and is not
renewed
Luo Longxin Staff supervisor
Term of office
expires and
leave the office
2019-02-21
Term of office expires and is not
renewed
Qian Xiaojun Deputy GM
Term of office
expires and
leave the office
2019-02-21
Term of office expires and is not
renewed
Yao Xiaopeng Deputy GM
Term of office
expires and
leave the office
2019-02-21
Term of office expires and is not
renewed
Wang Zhiping CFO
Term of office
expires and
leave the office
2019-02-21
Term of office expires and is not
renewed
Wang Fangcheng Secretary of the Board Dismiss 2019-06-13 Job transfer
48
Section IX. Corporate Bonds
Whether the Company has a corporation bonds that issuance publicly and listed on stock exchange and without due on the date when
semi-annual report approved for released or fail to cash in full on due
No
49
Section X. Financial Report
I. Audit reports
Whether the semi-annual report was audited or not
□ Yes √ No
The financial report of this semi-annual report was unaudited
II. Financial statements
Units in Notes of Financial Statements is RMB
1. Consolidated Balance Sheet
Prepared by SHENZHEN CEREALS HOLDINGS CO. LTD.
2019-06-30
In RMB
Item 2019-6-30 2018-12-31
Current assets:
Monetary funds 189914485.39 631638339.68
Settlement provisions
Capital lent
Tradable financial assets 1153309.17
Financial assets measured by fair
value and with variation reckoned into
current gains/losses
1124927.96
Derivative financial assets
Note receivable 350756.64 1027635.04
Account receivable 617831167.71 473646886.64
Receivable financing
Accounts paid in advance 26189928.10 83696870.07
Insurance receivable
Reinsurance receivables
Contract reserve of reinsurance
receivable
Other account receivable 57624419.71 33803428.45
50
Including: Interest receivable
Dividend receivable
Buying back the sale of financial
assets
Inventories 3053593314.19 2811802600.19
Contractual assets
Assets held for sale
Non-current asset due within one
year
Other current assets 108098667.05 254493764.04
Total current assets 4054756047.96 4291234452.07
Non-current assets:
Loans and payments on behalf
Debt investment
Finance asset available for sales 57500.00
Other debt investment
Held-to-maturity investment
Long-term account receivable
Long-term equity investment 73362651.19 70999666.81
Investment in other equity
instrument
Other non-current financial assets 57500.00
Investment real estate 278173249.83 282622184.92
Fixed assets 967835524.07 993136743.51
Construction in progress 403629287.82 186586135.06
Productive biological asset 402232.74 407078.92
Oil and gas asset
Right-of-use assets
Intangible assets 586543323.51 569997392.08
Expense on Research and
Development
Goodwill
Long-term expenses to be
apportioned
16742788.37 21799899.80
Deferred income tax asset 50155704.51 50174590.98
51
Other non-current asset 854782.25 1936149.72
Total non-current asset 2377757044.29 2177717341.80
Total assets 6432513092.25 6468951793.87
Current liabilities:
Short-term loans 30590000.00 91600000.00
Loan from central bank
Capital borrowed
Transactional financial liability
Financial liability measured by fair
value and with variation reckoned into
current gains/losses
Derivative financial liability
Note payable
Account payable 171201542.03 472738283.80
Accounts received in advance 136680506.97 205428594.16
Selling financial asset of
repurchase
Absorbing deposit and interbank
deposit
Security trading of agency
Security sales of agency
Wage payable 118823329.33 135709423.52
Taxes payable 30267605.83 24969718.58
Other account payable 304979705.51 280689548.29
Including: Interest payable 1020795.27
Dividend payable 2909182.74 2909182.74
Commission charge and
commission payable
Reinsurance payable
Contractual liability
Liability held for sale
Non-current liabilities due within
one year
60027362.43 55090793.79
Other current liabilities 219151968.63 219151968.63
Total current liabilities 1071722020.73 1485378330.77
Non-current liabilities:
52
Insurance contract reserve
Long-term loans 777384100.20 516687791.66
Bonds payable
Including: Preferred stock
Perpetual capital
securities
Lease liability
Long-term account payable 15724141.66 15690202.08
Long-term wages payable
Accrual liability
Deferred income 98721691.96 100608203.01
Deferred income tax liabilities 13162941.71 12988434.77
Other non-current liabilities
Total non-current liabilities 904992875.53 645974631.52
Total liabilities 1976714896.26 2131352962.29
Owner’s equity:
Share capital 1152535254.00 1152535254.00
Other equity instrument
Including: Preferred stock
Perpetual capital
securities
Capital public reserve 1422892729.36 1422892729.36
Less: Inventory shares
Other comprehensive income
Reasonable reserve 62409.56 154.21
Surplus public reserve 327140910.28 327140910.28
Provision of general risk
Retained profit 1357848812.47 1269933487.26
Total owner’ s equity attributable to
parent company
4260480115.67 4172502535.11
Minority interests 195318080.32 165096296.47
Total owner’ s equity 4455798195.99 4337598831.58
Total liabilities and owner’ s equity 6432513092.25 6468951793.87
Legal Representative: Zhu Junming
53
Person in charge of accounting works: Ye Qingyun
Person in charge of accounting institute: Wen Jieyu
2. Balance Sheet of Parent Company
In RMB
Item 2019-6-30 2018-12-31
Current assets:
Monetary funds 4667978.54 168900586.84
Trading financial assets 1153309.17
Financial assets measured by fair
value and with variation reckoned into
current gains/losses
1124927.96
Derivative financial assets
Note receivable
Account receivable 4700782.83 42441119.07
Receivable financing
Accounts paid in advance
Other account receivable 242873517.60 159677969.59
Including: Interest receivable
Dividend receivable
Inventories 2972019.11 8806338.26
Contractual assets
Assets held for sale
Non-current assets maturing within
one year
Other current assets 30000000.00 50068745.74
Total current assets 286367607.25 431019687.46
Non-current assets:
Debt investment
Available-for-sale financial assets
Other debt investment
Held-to-maturity investments
Long-term receivables
Long-term equity investments 4212419029.48 4212554063.36
54
Investment in other equity
instrument
Other non-current financial assets
Investment real estate 17693889.54 17929684.70
Fixed assets 30905606.49 31417912.54
Construction in progress
Productive biological assets 402232.74 407078.92
Oil and natural gas assets
Right-of-use assets
Intangible assets 6363106.12 6663692.30
Research and development costs
Goodwill
Long-term deferred expenses 302763.72 409621.50
Deferred income tax assets 5579344.64 5630538.80
Other non-current assets
Total non-current assets 4273665972.73 4275012592.12
Total assets 4560033579.98 4706032279.58
Current liabilities
Short-term borrowings
Trading financial liability
Financial liability measured by fair
value and with variation reckoned into
current gains/losses
Derivative financial liability
Notes payable
Account payable 34354909.69 73705646.54
Accounts received in advance 3247.80 124945.74
Contractual liability
Wage payable 9866658.37 6448561.16
Taxes payable 2745766.36 2702655.24
Other accounts payable 254402388.26 232109084.76
Including: Interest payable
Dividend payable
Liability held for sale
Non-current liabilities due within
55
one year
Other current liabilities
Total current liabilities 301372970.48 315090893.44
Non-current liabilities:
Long-term loans
Bonds payable
Including: preferred stock
Perpetual capital
securities
Lease liability
Long-term account payable
Long term employee compensation
payable
Accrued liabilities
Deferred income 45575.32 46129.96
Deferred income tax liabilities 18060.77 10965.46
Other non-current liabilities
Total non-current liabilities 63636.09 57095.42
Total liabilities 301436606.57 315147988.86
Owners’ equity:
Share capital 1152535254.00 1152535254.00
Other equity instrument
Including: preferred stock
Perpetual capital
securities
Capital public reserve 3018106568.27 3018106568.27
Less: Inventory shares
Other comprehensive income
Special reserve
Surplus reserve 54736482.14 54736482.14
Retained profit 33218669.00 165505986.31
Total owner’s equity 4258596973.41 4390884290.72
Total liabilities and owner’s equity 4560033579.98 4706032279.58
56
3. Consolidated Profit Statement
In RMB
Item Semi-annual of 2019 Semi-annual of 2018
I. Total operating income 4782167732.69 4434688646.82
Including: Operating income 4782167732.69 4434688646.82
Interest income
Insurance gained
Commission charge and
commission income
II. Total operating cost 4495390182.31 4187994970.83
Including: Operating cost 4262101770.62 3962753163.26
Interest expense
Commission charge and
commission expense
Cash surrender value
Net amount of expense of
compensation
Net amount of withdrawal of
insurance contract reserve
Bonus expense of guarantee slip
Reinsurance expense
Tax and extras 6605514.20 7661918.10
Sales expense 112553742.74 120452104.30
Administrative expense 101397947.99 96324028.90
R&D expense 4211474.91 2977062.54
Financial expense 8519731.85 -2173306.27
Including: Interest
expenses
10087784.34 4313048.72
Interest income 2185171.96 3899478.59
Add: other income 5463876.60 4324296.96
Investment income (Loss is
listed with “-”)
7167936.04 1343407.46
Including: Investment income
on affiliated company and joint venture
3413100.95 626055.86
The termination of income
recognition for financial assets measured
57
by amortized cost(Loss is listed with “-”)
Exchange income (Loss is
listed with “-”)
Net exposure hedging income
(Loss is listed with “-”)
Income from change of fair
value (Loss is listed with “-”)
28381.21 -425718.15
Loss of credit impairment
(Loss is listed with “-”)
5143559.77
Losses of devaluation of asset
(Loss is listed with “-”)
-69231423.42 -32562385.63
Income from assets disposal
(Loss is listed with “-”)
-4184.59 -210840.01
III. Operating profit (Loss is listed with
“-”)
235345695.99 219162436.62
Add: Non-operating income 362252.46 980860.83
Less: Non-operating expense 3982019.95 595492.72
IV. Total profit (Loss is listed with “-”) 231725928.50 219547804.73
Less: Income tax expense 15485294.03 11869852.06
V. Net profit (Net loss is listed with “-”) 216240634.47 207677952.67
(i) Classify by business continuity
1.continuous operating net profit(net loss listed with ‘-”)
216240634.47 207677952.67
2.termination of net profit (net losslisted with ‘-”)
(ii) Classify by ownership
1.Net profit attributable to owner’s
of parent company
203168850.61 202779343.34
2.Minority shareholders’ gains and
losses
13071783.86 4898609.33
VI. Net after-tax of other comprehensive
income
Net after-tax of other comprehensive
income attributable to owners of parent
company
(I) Other comprehensive income
items which will not be reclassified
subsequently to profit of loss
58
1.Changes of the defined
benefit plans that re-measured
2.Other comprehensive
income under equity method that cannot
be transfer to gain/loss
3.Change of fair value of
investment in other equity instrument
4.Fair value change of
enterprise's credit risk
5. Other
(ii) Other comprehensive income
items which will be reclassified
subsequently to profit or loss
1.Other comprehensive
income under equity method that can
transfer to gain/loss
2.Change of fair value of
other debt investment
3.gain/loss of fair value
changes for available-for-sale financial
assets
4.Amount of financial assets
re-classify to other comprehensive
income
5.Gain/loss of
held-to-maturity investments that
re-classify to available-for-sale financial
asset
6.Credit impairment
provision for other debt investment
7.Cash flow hedging reserve
8.Translation differences
arising on translation of foreign currency
financial statements
9.Other
Net after-tax of other comprehensive
income attributable to minority
shareholders
VII. Total comprehensive income 216240634.47 207677952.67
59
Total comprehensive income
attributable to owners of parent Company
203168850.61 202779343.34
Total comprehensive income
attributable to minority shareholders
13071783.86 4898609.33
VIII. Earnings per share:
(i) Basic earnings per share 0.1763 0.1759
(ii) Diluted earnings per share 0.1763 0.1759
Enterprise combine under the same control in the Period the combined party realized net profit of 0 Yuan before combination and
realized 0 Yuan at last period for combined party.Legal Representative: Zhu Junming
Person in charge of accounting works: Ye Qingyun
Person in charge of accounting institute: Wen Jieyu
4. Profit Statement of Parent Company
In RMB
Item Semi-annual of 2019 Semi-annual of 2018
I. Operating income 31562730.23 67228720.81
Less: Operating cost 29829293.00 63731294.22
Taxes and surcharge 252634.47 292769.77
Sales expenses 293450.97 1943060.61
Administration expenses 21614585.82 14366353.12
R&D expenses
Financial expenses -532360.14 -1565736.21
Including: interest
expenses
Interest income
Add: other income 1253598.63 554.64
Investment income (Loss is
listed with “-”)
1432614.92 -185480.37
Including: Investment income
on affiliated Company and joint venture
-135033.88 -185480.37
The termination of
income recognition for financial assets
measured by amortized cost (Loss is
listed with “-”)
60
Net exposure hedging income
(Loss is listed with “-”)
Changing income of fair
value (Loss is listed with “-”)
28381.21 -425718.15
Loss of credit impairment
(Loss is listed with “-”)
-204340.76
Losses of devaluation of asset
(Loss is listed with “-”)
409117.45 -203706.33
Income on disposal of assets
(Loss is listed with “-”)
II. Operating profit (Loss is listed with
“-”)
-16975502.44 -12353370.91
Add: Non-operating income
Less: Non-operating expense 51.64
III. Total Profit (Loss is listed with “-”) -16975502.44 -12353422.55
Less: Income tax 58289.47 -157620.42
IV. Net profit (Net loss is listed with
“-”)
-17033791.91 -12195802.13
(i)continuous operating net profit(net loss listed with ‘-”)
-17033791.91 -12195802.13
(ii) termination of net profit (netloss listed with ‘-”)
V. Net after-tax of other comprehensive
income
(I) Other comprehensive income
items which will not be reclassified
subsequently to profit of loss
1.Changes of the defined
benefit plans that re-measured
2.Other comprehensive
income under equity method that cannot
be transfer to gain/loss
3.Change of fair value of
investment in other equity instrument
4.Fair value change of
enterprise's credit risk
5. Other
(II) Other comprehensive income
items which will be reclassified
61
subsequently to profit or loss
1.Other comprehensive
income under equity method that can
transfer to gain/loss
2.Change of fair value of
other debt investment
3.gain/loss of fair value
changes for available-for-sale financial
assets
4.Amount of financial
assets re-classify to other
comprehensive income
5.Gain/loss of
held-to-maturity investments that
re-classify to available-for-sale financial
asset
6.Credit impairment
provision for other debt investment
7.Cash flow hedging
reserve
8.Translation differences
arising on translation of foreign
currency financial statements
9.Other
VI. Total comprehensive income -17033791.91 -12195802.13
VII. Earnings per share:
(i) Basic earnings per share -0.0148 -0.0106
(ii) Diluted earnings per share -0.0148 -0.0106
5. Consolidated Cash Flow Statement
In RMB
Item Semi-annual of 2019 Semi-annual of 2018
I. Cash flows arising from operating
activities:
Cash received from selling
commodities and providing labor
services
4570303860.45 4726406214.58
Net increase of customer deposit
62
and interbank deposit
Net increase of loan from central
bank
Net increase of capital borrowed
from other financial institution
Cash received from original
insurance contract fee
Net cash received from reinsurance
business
Net increase of insured savings
and investment
Cash received from interest
commission charge and commission
Net increase of capital borrowed
Net increase of returned business
capital
Net cash received by agents in sale
and purchase of securities
Write-back of tax received 341886.74 893445.54
Other cash received concerning
operating activities
187051727.97 24547106.70
Subtotal of cash inflow arising from
operating activities
4757697475.16 4751846766.82
Cash paid for purchasing
commodities and receiving labor
service
4737315792.15 4340946309.76
Net increase of customer loans and
advances
Net increase of deposits in central
bank and interbank
Cash paid for original insurance
contract compensation
Net increase of financial assets
held for transaction purposes
Net increase of capital lent
Cash paid for interest commission
charge and commission
Cash paid for bonus of guarantee
63
slip
Cash paid to/for staff and workers 117107205.65 126373197.96
Taxes paid 36670126.83 27553349.81
Other cash paid concerning
operating activities
256033980.28 204112663.99
Subtotal of cash outflow arising from
operating activities
5147127104.91 4698985521.52
Net cash flows arising from operating
activities
-389429629.75 52861245.30
II. Cash flows arising from investing
activities:
Cash received from recovering
investment
376000000.00 100000000.00
Cash received from investment
income
3281912.85 717351.60
Net cash received from disposal of
fixed intangible and other long-term
assets
5225078.07 8600.00
Net cash received from disposal of
subsidiaries and other units
Other cash received concerning
investing activities
Subtotal of cash inflow from investing
activities
384506990.92 100725951.60
Cash paid for purchasing fixed
intangible and other long-term assets
279258684.99 251093013.07
Cash paid for investment 246000000.00 120000000.00
Net increase of mortgaged loans
Net cash received from
subsidiaries and other units obtained
37000000.00
Other cash paid concerning
investing activities
Subtotal of cash outflow from investing
activities
525258684.99 408093013.07
Net cash flows arising from investing
activities
-140751694.07 -307367061.47
III. Cash flows arising from financing
activities
64
Cash received from absorbing
investment
17150000.00
Including: Cash received from
absorbing minority shareholders’
investment by subsidiaries
17150000.00
Cash received from loans 275167400.91 67732101.19
Cash received from issuing bonds
Other cash received concerning
financing activities
24500000.00
Subtotal of cash inflow from financing
activities
292317400.91 92232101.19
Cash paid for settling debts 70544523.73 18898888.81
Cash paid for dividend and profit
distributing or interest paying
133274201.72 6913361.89
Including: Dividend and profit of
minority shareholder paid by
subsidiaries
Other cash paid concerning
financing activities
72997.72
Subtotal of cash outflow from financing
activities
203891723.17 25812250.70
Net cash flows arising from financing
activities
88425677.74 66419850.49
IV. Influence on cash and cash
equivalents due to fluctuation in
exchange rate
31791.79 3088981.33
V. Net increase of cash and cash
equivalents
-441723854.29 -184996984.35
Add: Balance of cash and cash
equivalents at the period -begin
631638339.68 544440739.45
VI. Balance of cash and cash
equivalents at the period -end
189914485.39 359443755.10
6. Cash Flow Statement of Parent Company
In RMB
Item Semi-annual of 2019 Semi-annual of 2018
I. Cash flows arising from operating
activities:
65
Cash received from selling
commodities and providing labor
services
74116410.44 99228621.54
Write-back of tax received 336964.29 737441.54
Other cash received concerning
operating activities
138446106.95 27633986.64
Subtotal of cash inflow arising from
operating activities
212899481.68 127600049.72
Cash paid for purchasing
commodities and receiving labor
service
67845729.08 96230177.23
Cash paid to/for staff and workers 14152467.36 12384561.21
Taxes paid 1160654.10 2194673.02
Other cash paid concerning
operating activities
199823754.56 11572835.91
Subtotal of cash outflow arising from
operating activities
282982605.10 122382247.37
Net cash flows arising from operating
activities
-70083123.42 5217802.35
II. Cash flows arising from investing
activities:
Cash received from recovering
investment
266000000.00
Cash received from investment
income
1567648.80
Net cash received from disposal of
fixed intangible and other long-term
assets
2710.37
Net cash received from disposal of
subsidiaries and other units
Other cash received concerning
investing activities
Subtotal of cash inflow from investing
activities
267570359.17
Cash paid for purchasing fixed
intangible and other long-term assets
483680.00 18200.00
Cash paid for investment 246000000.00 30000000.00
Net cash received from
66
subsidiaries and other units obtained
Other cash paid concerning
investing activities
Subtotal of cash outflow from investing
activities
246483680.00 30018200.00
Net cash flows arising from investing
activities
21086679.17 -30018200.00
III. Cash flows arising from financing
activities
Cash received from absorbing
investment
Cash received from loans
Cash received from issuing bonds
Other cash received concerning
financing activities
Subtotal of cash inflow from financing
activities
Cash paid for settling debts 10000000.00
Cash paid for dividend and profit
distributing or interest paying
115253525.40 28710.00
Other cash paid concerning
financing activities
72997.72
Subtotal of cash outflow from financing
activities
115326523.12 10028710.00
Net cash flows arising from financing
activities
-115326523.12 -10028710.00
IV. Influence on cash and cash
equivalents due to fluctuation in
exchange rate
90359.07 76401.91
V. Net increase of cash and cash
equivalents
-164232608.30 -34752705.74
Add: Balance of cash and cash
equivalents at the period -begin
168900586.84 239662344.24
VI. Balance of cash and cash
equivalents at the period -end
4667978.54 204909638.50
67
7. Statement of Changes in Owners’ Equity (Consolidated)
Current period
In RMB
Item
Semi-annual of 2019
Owners’ equity attributable to the parent Company
Minority
interests
Total owners’
equity Share capital
Other
equity
instrument
Capital reserve
Less:
Inve
ntory
share
s
Othe
r
comp
rehen
sive
inco
me
Reasonabl
e reserve
Surplus reserve
Provi
sion
of
gener
al
risk
Retained profit
Othe
r
Subtotal
Pr
efe
rre
d
sto
ck
Pe
rpe
tua
l
ca
pit
al
sec
uri
tie
s
Ot
her
I. Balance at the
end of the last year
1152535254.00 1422892729.36 154.21 327140910.28 1269933487.26 4172502535.11 165096296.47 4337598831.58
Add:
Changes of
accounting policy
Error
correction of the
last period
Enterprise
combine under
the same control
68
Other
II. Balance at the
beginning of this
year
1152535254.00 1422892729.36 154.21 327140910.28 1269933487.26 4172502535.11 165096296.47 4337598831.58
III. Increase/
Decrease in this
year (Decrease is
listed with “-”)
62255.35 87915325.21 87977580.56 30221783.85 118199364.41
(i) Total
comprehensive
income
203168850.61 203168850.61 13071783.85 216240634.46
(ii) Owners’
devoted and
decreased capital
17150000.00 17150000.00
1.Common shares
invested by
shareholders
17150000.00 17150000.00
2. Capital invested
by holders of other
equity instruments
3. Amount
reckoned into
owners equity
with share-based
payment
4. Other
(III) Profit
distribution
-115253525.40 -115253525.40 -115253525.40
1. Withdrawal of
surplus reserves
2. Withdrawal of
general risk
provisions
69
3. Distribution for
owners (or
shareholders)
-115253525.40 -115253525.40 -115253525.40
4. Other
(IV) Carrying
forward internal
owners’ equity
1. Capital reserves
conversed to
capital (share
capital)
2. Surplus reserves
conversed to
capital (share
capital)
3. Remedying loss
with surplus
reserve
4．Carry-over
retained
earnings from
the defined
benefit plans
5．Carry-over
retained earnings
from other
comprehensive
income
6. Other
(V) Reasonable
reserve
62255.35 62255.35 62255.35
1. Withdrawal in
the report period
460394.34 460394.34 460394.34
2. Usage in the 398138.99 398138.99 398138.99
70
report period
(VI)Others
IV. Balance at the
end of the report
period
1152535254.00 1422892729.36 62409.56 327140910.28 1357848812.47 4260480115.67 195318080.32 4455798195.99
Last Period
In RMB
Item
Semi-annual of 2018
Owners’ equity attributable to the parent Company
Minority
interests
Total owners’
equity Share capital
Other
equity
instrument
Capital reserve
Less:
Inven
tory
share
s
Other
comp
rehen
sive
inco
me
Reasonabl
e reserve
Surplus reserve
Provi
sion
of
gener
al
risk
Retained profit
Othe
r
Subtotal
Pr
efe
rre
d
sto
ck
Pe
rp
etu
al
ca
pit
al
se
cu
riti
es
Oth
er
I. Balance at the
end of the last
year
496782303.00 358999356.28 54736482.14 36402435.91 946920577.33 16232752.93 963153330.26
Add:
Changes of
accounting policy
Error
correction of the
71
last period
Enterprise
combine under
the same control
Other
II. Balance at the
beginning of this
year
496782303.00 358999356.28 54736482.14 36402435.91 946920577.33 16232752.93 963153330.26
III. Increase/
Decrease in this
year (Decrease is
listed with “-”)
-18246639.07 -18246639.07 -979179.58 -19225818.65
(i) Total
comprehensive
income
-18246639.07 -18246639.07 -979179.58 -19225818.65
(ii) Owners’
devoted and
decreased capital
1.Common shares
invested by
shareholders
2. Capital
invested by
holders of other
equity
instruments
3. Amount
reckoned into
owners equity
with share-based
payment
4. Other
(III) Profit
72
distribution
1. Withdrawal of
surplus reserves
2. Withdrawal of
general risk
provisions
3. Distribution for
owners (or
shareholders)
4. Other
(IV) Carrying
forward internal
owners’ equity
1. Capital
reserves
conversed to
capital (share
capital)
2. Surplus
reserves
conversed to
capital (share
capital)
3. Remedying
loss with surplus
reserve
4．Carry-over
retained
earnings from
the defined
benefit plans
5．Carry-over
retained earnings
from other
comprehensive
73
income
6. Other
(V) Reasonable
reserve
1. Withdrawal in
the report period
2. Usage in the
report period
(VI)Others
IV. Balance at the
end of the report
period
496782303.00 358999356.28 54736482.14 18155796.84 928673938.26 15253573.35 943927511.61
8. Statement of Changes in Owners’ Equity (Parent Company)
Current period
In RMB
Item
Semi-annual of 2019
Share capital
Other equity instrument
Capital public
reserve
Less:
Inventory
shares
Other
comprehens
ive income
Reasonable
reserve
Surplus
reserve
Retained profit Other
Total owners’
equity
Preferred
stock
Perpetual
capital
securities
Other
I. Balance at the end of
the last year
1152535254.00 3018106568.27 54736482.14 165505986.31 4390884290.72
Add: Changes of
accounting policy
Error
correction of the last
period
Other
74
II. Balance at the
beginning of this year
1152535254.00 3018106568.27 54736482.14 165505986.31 4390884290.72
III. Increase/ Decrease
in this year (Decrease
is listed with “-”)
-132287317.3
-132287317.31
(i) Total
comprehensive income
-17033791.91 -17033791.91
(ii) Owners’ devoted
and decreased capital
1.Common shares
invested by
shareholders
2. Capital invested by
holders of other equity
instruments
3. Amount reckoned
into owners equity with
share-based payment
4. Other
(III) Profit distribution
-115253525.4
0
-115253525.40
1. Withdrawal of
surplus reserves
2. Distribution for
owners (or
shareholders)
-115253525.4
0
-115253525.40
3. Other
(IV) Carrying forward
internal owners’ equity
1. Capital reserves
conversed to capital
(share capital)
2. Surplus reserves
75
conversed to capital
(share capital)
3. Remedying loss with
surplus reserve
4．Carry-over retained
earnings from the
defined benefit plans
5．Carry-over retained
earnings from other
comprehensive income
6. Other
(V) Reasonable reserve
1. Withdrawal in the
report period
2. Usage in the report
period
(VI)Others
IV. Balance at the end
of the report period
1152535254.00 3018106568.27 54736482.14 33218669.00 4258596973.41
Last Period
In RMB
Item
Semi-annual of 2018
Share capital
Other equity instrument
Capital public
reserve
Less:
Inventory
shares
Other
comprehen
sive
income
Reasonable
reserve
Surplus
reserve
Retained profit Other
Total owners’
equity
Preferred
stock
Perpetua
l capital
securitie
s
Other
I. Balance at the end
of the last year
496782303.00 382444482.45 54736482.14 199789650.74 1133752918.33
Add: Changes of
accounting policy
76
Error
correction of the last
period
Other
II. Balance at the
beginning of this year
496782303.00 382444482.45 54736482.14 199789650.74 1133752918.33
III. Increase/ Decrease
in this year (Decrease
is listed with “-”)
-12195802.13 -12195802.13
(i) Total
comprehensive
income
-12195802.13 -12195802.13
(ii) Owners’ devoted
and decreased capital
1.Common shares
invested by
shareholders
2. Capital invested by
holders of other
equity instruments
3. Amount reckoned
into owners equity
with share-based
payment
4. Other
(III) Profit
distribution
1. Withdrawal of
surplus reserves
2. Distribution for
owners (or
shareholders)
3. Other
77
(IV) Carrying forward
internal owners’
equity
1. Capital reserves
conversed to capital
(share capital)
2. Surplus reserves
conversed to capital
(share capital)
3. Remedying loss
with surplus reserve
4．Carry-over retained
earnings from the
defined benefit plans
5．Carry-over retained
earnings from other
comprehensive
income
6. Other
(V) Reasonable
reserve
1. Withdrawal in the
report period
2. Usage in the report
period
(VI)Others
IV. Balance at the end
of the report period
496782303.00 382444482.45 54736482.14 187593848.61 1121557116.20
78
III. Basic situation of Company
1. The history of the company
Shenzhen Cereals Holdings Co. Ltd. (formerly the Shenzhen Shenbao Industrial Co. Ltd. hereinafter referred to
as “Company” or “the Company” ) formerly named Shenzhen Shenbao Canned Food Company obtained
approval (Document (1991) No.978) from Shenzhen Municipal People’s Government to change to the present
name as on 1 August 1991.Then with the approval (Document (1991)No.126) from People’s Bank of China the
Company began to list on Shenzhen Stock Exchange. The certificate for uniform social credit code:
91440300192180754J
The Company initially issued 107312935 shares in the stock exchange. In 1992 one bonus share was dispatched
for each 10 shares held by its shareholders thus totally 10731290 shares were increased. In 1993 one bonus
share and one allotted share were dispatched for each 10 shares held by its shareholders thus totally 20878845
shares were increased. Subsequently one bonus share was dispatched for each 10 shares held by shareholders
upon the basis of total share capital as at the end of 1996 and capitalizing of capital reserves was carried out at
one to ten basis thus totally 27784614 shares were increased. In 2001 based on the total share capital as at the
end of 1999 three shares were allotted for each 10 shares held by shareholders and totally 15215404 shares
were allotted. The registered capital of the Company amounts to 181 923088 yuan.
On 22 June 2011 the Company privately offering 68977066 shares of RMB ordinary share (A share) to target
investors with issuing price of 8.70 yuan each while book value of 1.00 yuan. Total monetary capital
600100474.20 yuan was raised. Change procedures of industrial and commerce has completed on 12 July 2011.
Register capital of the Company changed as 250900154.00 yuan.
On 9 April 2014 the equity allocation plan was deliberated and approved by Annual General Meeting of 2013.
Based on 250900154 shares dated 31
st
December 2013 increase 2 shares by each 10 shares transferring to all
shareholders. Share capital increased to 301080184 shares after transferring.
On 17 May 2016 the equity allocation plan was deliberated and approved by Annual General Meeting of 2015.
Based on 301080184 shares dated 31
st
December 2015 increase 5 shares by each 10 shares transferring to all
shareholders. Share capital increased to 451620276 shares after transferring.
On 15 May 2017 the equity allocation plan was deliberated and approved by Annual General Meeting of 2016.
Based on 451620276 shares dated 31
st
December 2016 distributed 0.50 Yuan (tax included) for every 10 shares
held by all shareholders with one bonus shares (tax included) no capitalization from public reserves. Shares
capital increased to 496782303 shares after bonus stock distributed.On October 15 2018 the Company received the “Reply on the Approval of Shenzhen Shenbao Industrial Co. Ltd.to Issue Shares to Shenzhen Fude State-owned Capital Operation Co. Ltd. to Purchase Assets” (ZJXK [2018] No.79
1610) from the China Securities Regulatory Commission agreed the Company to issue 655752951 shares of
restricted ordinary shares to Shenzhen Fude State-owned Capital Operation Co. Ltd. (hereinafter referred to as
Fude Capital) to acquire 100.00% equity of Shenzhen Cereals Group Co. Ltd. held by Fude Capital.
On October 18 2018 100.00% equity of Shenzhen Cereals Group Co. Ltd. completed the transfer procedures and
related industrial and commercial change registration. After the completion of this major asset reorganization the
Company’s share capital increased to 1152535254 shares. This share capital change was examined by Jonten
Certified Public Accountant (Limited Liability Partnership) who issued the capital verification report Jonten [2018]
YZ No. 90066 on October 22 2018.
End as 30 June 2019 the total share capital of the company was 1152535254 shares registered capital amounted
to 1152535254.00 yuan.
Register address of the Company: 8/F Tower B No.4 Building Software Industry Base South District Science &
Technology Park Xuefu Rd. Yuehai Street Nanshan District Shenzhen
On 30 January 2019 the Company hold a Second Extraordinary Shareholders Meeting of 2019 to deliberated and
approved the proposal of “Change the Name and Stock Short Name of the Company ” agreed to change the name
of the Company from “Shenzhen Shenbao Industrial Co. Ltd.” to “Shenzhen Cereals Holdings Co. Ltd.” stock
short name change from “Shen Shenbao A Shen Shenbao B” to “SZCH Shenliang B”. On 18 February 2019
registration procedures on industrial and commercial has completed and obtained the new Business License from
Shenzhen Market Supervision and Administration.(ii) Business nature and main operation activities
The Company belongs to the grain oil food and beverage industry.Main products of the Company including grain and oil trading and processing grain and oil reserve service
military food supplies food beverage of tea and tea products.
Business scope: production of tea tea products extract of tea and natural plant canned food beverage and native
products ( business license for the production place should apply separately); technology development and
technology service of tea plant products soft beverage and foods; info tech development and supporting service;
on-line trading; investment operation management and development of tea plantation; investment in industrial
projects (apply separately for detail projects); domestic trading(excluding special sales specific control and
exclusive commodity); import and export business; engaged in real estate development and operation in the landlegally obtained; lease and sales of the self-owned property and property management.” (as for the projects
subject to examination and approval regulated by the state laws administrative regulations and state council
approval should be obtained before operation). Business in license: wholesale of prepackaged food (excluding
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reheating prepackaged food) (in non-physical way).In the reporting period under the way of issuing shares to Fude Capital for purchasing 100 percent equity of
Shenzhen Cereals Group Co. Ltd on basis of production research and development and sales of food raw
materials (ingredients) centered on intensive processing of tea and natural plants main business of the Company
increased grain and oil reserve grain & oil trading circulation of grain and oil such as grain and oil processing
and grain and oil reserve service. Therefore on 18 February 2019 relevant business scope of the Company was
changed as: general operation items: acquisition and sales of grain & oil grain and oil reserves; management and
processing of grain & oil and their products; production of tea tea products extract of tea and natural plant
canned food beverage and native products ( business license for the production place should apply separately);
management and processing of feed (outsourcing); grain and oil logistics feed logistics investment operation and
development for the projects of tea garden; sales of feed and tea; storage service; grain distribution services;
modern grain supply chain service; technical development and services of grain and oil tea plant products soft
drinks and food; E-business and information construction IT development and supporting services; investment in
industrial projects (apply separately for detail projects); domestic trading; import and export business; engaged in
real estate development and operation in the land legally obtained; development operation leasing and
management of the owned property; property management; providing management services for hotels. (as for
projects mentioned above that are required to be submitted for examination and approval by the laws
administrative regulations and decision of the state council approval and examination shall be required before
operated). Business in license: wholesale of prepackaged food (excluding reheating prepackaged food) (in
non-physical way); information services business (internet information services business only); general freight
transportation and professional transportation (refrigeration and fresh-keeping)
(iii) Report approval for the financial statement
The statement has been approved by BOD of the company for reporting on 23 August 2019.Up to 30
th
June 2019 the subsidiaries included in consolidate financial statement mainly including:
Subsidiary Type Level Shareholding ratio (%) Voting rights ratio (%)
Shenzhen Shenbao Huacheng Science and Technology
Co.Ltd(hereinafter referred to as Shenbao Huacheng)
Wholly-owned
subsidiary
First grade 100 100
Ju Fang Yong Tea Industry Co. Ltd. in Wuyuan
County(hereinafter referred to as Wuyuan Ju Fang
Yong)
Wholly-owned
subsidiary
First grade 100 100
Shenzhen Shenbao Sanjing Food & Beverage
Development Co. Ltd(hereinafter referred to as
Shenbao Sanjing)
Wholly-owned
subsidiary
First grade 100 100
Huizhou Shenbao Technology Co. Ltd(hereinafter
referred to as Huizhou Shenbao Technology )
Wholly-owned
subsidiary
First grade 100 100
Shenzhen Shenbao Property Management Co. Wholly-owned First grade 100 100
81
Ltd.(hereinafter referred to as Shenbao Property) subsidiary
Shenzhen Shenbao Industrial & Trading Co.Ltd.(hereinafter referred to as Shenbao Industrial &
Trading)
Wholly-owned
subsidiary
First grade 100 100
Hangzhou Ju Fang Yong Holding Co. Ltd(hereinafter
referred to as Hangzhou Ju Fang Yong)
Wholly-owned
subsidiary
First grade 100 100
Shenzhen Shenbao Technology Center Co.Ltd(hereinafter referred to as Shenbao Technology
Center )
Wholly-owned
subsidiary
First grade 100 100
Shenzhen Shenshenbao Investment Co. Ltd.(hereinafter referred to as Shenshenbao Investment )
Wholly-owned
subsidiary
First grade 100 100
Yunnan Shenbao Pu’er Tea Supply Chain
Management Co. Ltd(hereinafter referred to as
Yunnan Supply Chain)
Wholly-owned
subsidiary
First grade 100 100
Huizhou Shenbao Food Co. Ltd(hereinafter referred
to as Huizhou Shenbao Food)
Wholly-owned
subsidiary
First grade 100 100
Yunnan Pu’er Tea Trading Center Co. Ltd(hereinafter
referred to as Pu’er Tea Trading Center)
Controlling
subsidiary
First grade 55 55
Mount Wuyi Shenbao Rock Tea Co. Ltd. (hereinafter
referred to as Shenbao Rock Tea )
Wholly-owned
subsidiary
Second
grade
100 100
Hangzhou Fuhaitang Tea Ecological Technology Co.Ltd(hereinafter referred to as Fuhaitang Ecological)
Wholly-owned
subsidiary
Second
grade
100 100
Hangzhou Chunshi Network Technology
Co.Ltd.(hereinafter referred to as Chunshi Network)
Wholly-owned
subsidiary
Second
grade
100 100
Shenzhen Shenshenbao Tea Culture Management Co.Ltd.(hereinafter referred to as Shenshenbao Tea
Culture)
Wholly-owned
subsidiary
Second
grade
100 100
Hangzhou Ju Fang Yong Trading Co. Ltd.(hereinafter referred to as Ju Fang Yong Trading)
Controlling
subsidiary
Second
grade
60 60
Shenzhen Shenbao Tea-Shop Co. Ltd. (hereinafter
referred to as Shenbao Tea-Shop)
Wholly-owned
subsidiary
Second
grade
100 100
Hangzhou Fuhaitang Catering Management chain Co.Ltd(hereinafter referred to as Fuhaitang Catering)
Wholly-owned
subsidiary
Second
grade
100 100
Shenzhen Cereals Group Co. Ltd(hereinafter referred
to as SZCG)
Wholly-owned
subsidiary
First grade 100 100
Shenzhen Flour Co. Ltd(hereinafter referred to as
Shenzhen Flour)
Wholly-owned
subsidiary
Second
grade
100 100
Shenzhen Hualian Grain & Oil Trade Co. ltd.(hereinafter referred to as Hualian Grain & oil
trading)
Wholly-owned
subsidiary
Second
grade
100 100
Hainan Haitian Aquatic Feed Co. Ltd(hereinafter
referred to as Hainan Haitian )
Wholly-owned
subsidiary
Second
grade
100 100
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Shenzhen Shenliang Quality Inspection Co. Ltd.(hereinafter referred to as Shenliang Quality
Inspection)
Wholly-owned
subsidiary
Second
grade
100 100
Shenzhen Shenliang Doximi Business Co.Ltd.(hereinafter referred to as Shenliang Doximi)
Wholly-owned
subsidiary
Second
grade
100 100
Shenzhen Shenliang Cold-Chain Logistic Co.Ltd(hereinafter referred to as Shenliang Cold-Chain
Logistic )
Wholly-owned
subsidiary
Second
grade
100 100
Shenzhen Shenliang Big Kitchen Food Supply Chain
Co. Ltd(hereinafter referred to as Shenliang Big
Kitchen)
Controlling
subsidiary
Second
grade
70 70
Shenzhen Shenliang Real Estate Development Co.Ltd. (hereinafter referred to as Shenliang Real Estate
Development)
Wholly-owned
subsidiary
Second
grade
100 100
Shenzhen Shenliang Property Management Co. Ltd.(hereinafter referred to as Shenliang Property )
Wholly-owned
subsidiary
Third
grade
100 100
Shenliang Storage (Yingkou) Co. Ltd(hereinafter
referred to as Shenliang Storage (Yingkou) ) )
Wholly-owned
subsidiary
Third
grade
100 100
Dongguan Shenliang Logistics Co. Ltd.(hereinafter
referred to as Dongguan Shenliang Logistics )
Controlling
subsidiary
Second
grade
51 51
Dongguan International Food Industrial Park
Development Co. Ltd.(hereinafter referred to as
Dongguan Food Industrial Park)
Controlling
subsidiary
Third
grade
51 51
Dongguan Shenliang Oil & Food Trade Co. Ltd.
(hereinafter referred to as Dongguan Food Trade)
Controlling
subsidiary
Third
grade
51 51
Dongguan Jinying Biology Tech. Co. Ltd.
(hereinafter referred to as Dongguan Jinying )
Controlling
subsidiary
Third
grade
51 51
Shuangyashan Shenliang Zhongxin Cereals Base Co.Ltd.(hereinafter referred to as Shuangyashan
Shenliang Zhongxin )
Controlling
subsidiary
Second
grade
51 51
Heilongjiang Hongxinglong Nongken Shenxin Cereals
Industrial Park Co. ltd.(hereinafter referred to as Hongxinglong Nongken
Industrial Park)
Controlling
subsidiary
Third
grade
51 51
Change of the consolidate scope found more in Note VIII. Change of consolidate scope and Note IX. Equity in
other entity
83
IV. Basis of preparation of financial statements
1. Basis of preparation
Based on going concern and according to actual occurrence of transactions and issues the Company prepared the
financial statement in line with the Accounting Standards for Business Enterprise -Basic Standard issued by
Ministry of Finance and specific accounting principle as well as the application guidance for the accounting
principles for enterprise interpretation to the accounting principles for enterprise and other related requirements
(hereinafter referred to as Enterprise Accounting Principles) combining the Information Disclosure Preparation
Rules for Company Public Issuing Securities No.15-General Rules for Financial Report (amended in 2014) of the
CSRC
2. Going concern
The Company was evaluated on continued viability of 12 months for the reporting period and found to have no
significant doubt. Accordingly the financial statements have been prepared on the basis of going concern
assumptions.V. Major accounting policy accounting estimation
Specific accounting policies and estimation attention:
(i) Implementation of the Accounting Standards for Business Enterprise No. 22- Recognition and Measurement of
Financial Instruments Accounting Standards for Business Enterprise No. 23- Transfer of Financial Assets
Accounting Standards for Business Enterprise No. 24- Hedge Accounting and Accounting Standards for Business
Enterprise No. 37- Presentation of Financial Instruments (2017 Revised) and in 2017 the Ministry of Finance
revised the Accounting Standards for Business Enterprise No. 22- Recognition and Measurement of Financial
Instruments Accounting Standards for Business Enterprise No. 23- Transfer of Financial Assets Accounting
Standards for Business Enterprise No. 24- Hedge Accounting and Accounting Standards for Business Enterprise
No. 37- Presentation of Financial Instruments. The revised standards stipulate that for financial instruments that
have not been derecognized on the first implementation date if the previous recognition and measurement are
inconsistent with the requirements of the revised standards they shall be retrospectively adjusted. If the data
relating to the comparative financial statements in prior period are inconsistent with the requirements of the
revised standards no adjustment is required. The Company will adjust the retained earnings and other
comprehensive income at the beginning of the year due to the cumulative impact of retrospective adjustment the
main impacts of the implementation of the above standards are as follows: (1) Due to the change in the name ofthe report item “the financial assets measured at fair value and whose changes are included in the current profit84and loss” are reclassified as “transactional financial assets” financial assets measured at fair value and whosechanges are included in the current profit and loss have a decrease of 1124927.96 yuan; and the trading financial
assets have an increase of 1124927.96 yuan; (2) the available-for-sale equity instrument investments arereclassified as the “financial assets measured at fair value and whose changes are included in the current profit andloss”. Available-for-sale financial assets have a decrease of 57500.00 yuan; other non-current financial assets
have an increase of 57500.00 yuan.(ii) Implementation of the Ministry of Finance issued the Notice on Revision and Issuance of 2019 Financial
Statement Format for General Corporate
On 30 April 2019 the Ministry of Finance issued the Notice on Revision and Issuance of 2019 Financial
Statement Format for General Corporate (Cai Kuai [2019] No.6) format of the financial statement has beenrevised. Main impact for implementation of the above mentioned regulations: in balance sheet: the “Notereceivable and account receivable” divided into “Note receivable” and “Account receivable”; “Note payable andaccount payable” divided into “Note payable” and “Account payable”; the comparison data are adjustedaccordingly. “Note receivable and account receivable” divided into “Note receivable” and “Account receivable”
current amount of “Note receivable” was 350756.64 Yuan while 1027635.04 Yuan at last period; the “Accountreceivable” has617831167.71Yuan in the period while 473646886.64 Yuan at last period; “Note payable andaccount payable” divided into “Note payable” and “Account payable” current amount of “Account payable” was
171201542.03 Yuan while 472738283.80 Yuan at last period.
1. Statement for observation of Accounting Standard for Enterprise
The financial statements prepared by the Company are in accordance to requirements of Accounting Standard for
Enterprise which truly and completely reflect the information related to financial position operational results and
cash flow of the Company.
2. Accounting period
Calendar year is the accounting period for the Company that is falls to the range starting from 1 January to 31
December.
3. Operating cycle
Operating cycle of the Company was 12 months
85
4. Standard currency
The Company and its subsidiaries take RMB as the standard currency for bookkeeping.
5. Accounting treatment for business combinations under the same control and those not under the same
control
Business combination under the same control: The assets and liabilities the Company acquired in a business
combination shall be measured in accordance with book value of assets liabilities (including the ultimate
controlling party of goodwill acquired by the merging parties and the formation of) stated in combined financial
report of the ultimate controlling party on the merger date. The net book value of assets and the payment of the
merger consideration in the merger book value (or nominal value of shares issued) shall be adjusted in the share
premium of reserve capital. the share premium in capital reserve is not enough for deducting retained earnings .
Business combination not under the same control: Assets paid and liabilities taken for business combination on
the acquisition date shall be measured at fair value. The difference between the fair value and book value is
recognized in profit or loss. Goodwill is realized by the Company as for the difference between the combination
cost and the fair value of the recognizable net assets of the acquiree acquired by acquirer in such business
combination. In case that the above cost is less than the above fair value even with re-review then the difference
shall be recorded in current gains and losses.
Audit legal consulting services and other intermediary costs and other expenses directly related to the business
combination shall be included in current profit or loss in the event; any transaction fee for issuing equity
securities for business combination shall be deducted from equity.
6. Methods for preparation of consolidated financial statements
(i) Consolidated scope
The consolidation scope of the consolidated financial statements of the Company is fixed on the basis of control
and all subsidiaries(including the divisible part of the invested party that control by the Company) have been
consolidated.(ii)Consolidated procedure
The Company edits the consolidated financial statements based on its own financial statements and the
subsidiaries’ as well as other relevant information. The consolidated financial statements hold the enterprise
group as a whole accounting entity. It is recognized in accordance with relevant Accounting Standards
86
measurement and presentation requirements. Uniform accounting policies reflect the overall financial position of
the Group's business operating results and cash flow.The accounting policies and accounting period adopted by the subsidiaries taken into account of the consolidation
scope are in line with the Company. If it is not the same as the Company necessary adjustments will be made
when preparing consolidated financial statements according to the accounting policy and accounting period of the
Company. For the subsidiaries acquired through business combination under uncommon control financial
statements shall be adjusted based on the fair value of the identifiable net assets on acquiring date. For the
subsidiaries acquired through business combination under common control its assets and liabilities (including
goodwill formed from ultimate controlling party acquiring the subsidiary to) shall be adjusted based on the book
value in the financial statements of the ultimate controlling party.Subsidiary's equity current net profits or losses and current comprehensive income belonging to minority
shareholders shall be listed respectively under item of owners’ equity in the consolidated balance sheet item of
net profit in profit sheet and item of total comprehensive income. Current loss minority shareholders of a
subsidiary exceed the minority shareholders in the subsidiary's opening owners' equity share and the formation of
balance offset against minority interests.
(1) Increase of subsidiary or business
During the reporting period the merger of the enterprises under the same control results in additional subsidiaries
or business then adjust the opening amount of consolidated balance sheet; income expenses and profit of the
subsidiaries or business from beginning to the end of the reporting shall be included in the consolidated profit
statement; cash flows of the subsidiaries or business from beginning to the end of reporting period shall be
included into the consolidated cash flow statement. And relevant comparative items of comparable statement shall
be adjusted since reporting entity is controlled by the ultimate controller.If additional investment and other reasons can lead investee to be controlled under the same control all parties
shall be adjusted at the beginning when the ultimate controlling party starts control. Equity investments made
before obtaining controlling right relevant gains and losses and other comprehensive income as well as other
changes in net assets confirmed during the latter date between point obtaining original equity and merger and
mergered under the same control day to the combined day shall be offset against the retained earnings or profit or
loss of the comparative reporting period.
During the reporting period opening amount of consolidated balance sheet shall not be adjusted since enterprise
under different control combine or increase holding of subsidiary or business; the income expense and profit of
the subsidiaries or business from the acquisition date to the end of reporting period shall be included in the
consolidated profit statement; while cash flows shall be included into the consolidated cash flow statement.87
Equity held from investee before acquisition date shall be measured at fair value of acquisition date if additional
investment and other reasons can lead investee to be controlled under the same control. Difference between the
fair value and the book value is recognized as investment income. other comprehensive income and other owners'
equity except for net profit or loss other comprehensive income and the distribution of profits related to equity
held from investee before acquisition date as well as relevant other comprehensive income associated with all
other by changes in equity shall be included in current investment income except for other comprehensive income
arising from change of net assets or net liabilities redefined by investee.
(2) Disposal of subsidiaries or business
① The general approach
During the reporting period the Company carry out disposal of subsidiaries or business revenue expense and
profit of the subsidiary or business included in the consolidated profit statement from the beginning to the disposal
date; while the cash flow into cash flow table.If losing controlling right to investee due to disposal of partial equity the remaining equity after the disposal shall
be re-measured at fair value at the date when control is lost. Price of equity disposal plus fair value of the
remaining equity then subtracting net assets held from the former subsidiary from the acquisition date or
combination date initially measured in accordance with original stake and goodwill the difference shall be
included in investment income of the period losing controlling right. other comprehensive income and other
owners' equity except for net profit or loss other comprehensive income and the distribution of profits related to
equity held from investee before acquisition date as well as relevant other comprehensive income associated with
all other by changes in equity shall be included in current investment income except for other comprehensive
income arising from change of net assets or net liabilities redefined by investee.If the Company’s shareholding ratio declines and thus loses the control power due to other investors’ capital
increase in the subsidiaries accounting treatment shall be conducted in accordance with the above principles.② Step disposal of subsidiaries
As multiple transactions over disposal of the subsidiary's equity lead to loss of controlling right if the terms of the
transaction situation and economic impact subject to one or above of the following conditions usually it indicates
repeated transactions should be accounted for as a package deal:
i. These transactions are made considering at the same time or in the case of mutual impact;
ii. These transactions only reach a complete business results when as a whole;
iii. A transaction occurs depending on the occurrence of at least one other transaction;
iv. Single transaction is not economical but considered together with other transactions it is economical.If disposal of equity in subsidiaries lead the loss of control and the transactions can be seen as a package deal the
Company will take accounting treatment of the transaction; however before the loss of control the difference
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between the disposal price and the corresponding net assets of the subsidiary recognized as other comprehensive
income in the consolidated financial statements into current profit and loss at current period when losing
controlling right.If disposal of equity in subsidiaries lead the loss of control and the transactions doesn’t form a package deal
equity held from subsidiary shall be accounted in accordance with relevant rules before losing controlling right
while in accordance with general accounting treatment when losing controlling right.
(3) Purchase of a minority stake in the subsidiary
Long-term equity investment of the Company for the purchase of minority interests in accordance with the newly
acquired stake in the new calculation shall be entitled to the difference between the net assets from the acquisition
date (or combination date) initially measured between the consolidated balance sheet adjustment capital balance
of the share premium in the capital reserve share premium insufficient any excess is adjusted to retained earnings.
(4) Disposal of equity in subsidiary without losing control
Disposal price and disposal of long-term equity investment without a loss of control due to partial disposal of
subsidiaries and long-term equity investment made between the relative net assets from the purchase date or the
date of merger were initially measured at the difference between the subsidiary shall enjoy the consolidated
balance sheet adjustment in the balance of the share premium capital balance of the share premium insufficient
any excess is adjusted to retained earnings.
7. Classification of joint venture arrangement and accounting for joint operations
Joint venture arrangements are divided into joint operations and joint ventures.When the Company is a joint venture party of a joint venture arrangement and enjoys the relevant assets of the
arrangement and bears the liabilities related to the arrangement it is a joint operation.The Company recognizes its proportion of interests in joint operation as related to the Company and accounts for
under relevant business accounting principles:
(1) To recognize separately-held assets and jointly-held assets under its proportion;
(2) To recognize separately-assumed liabilities and jointly-assumed liabilities under its proportion;
(3) To recognize revenue from disposal of the output which the Company is entitled to under the proportion;
(4) To recognize revenue from disposal of the output under the proportion;
(5) To recognize separately occurred expenses and to recognize expenses occurred for joint operations under its
proportion.89
8. Recognition standards for cash and cash equivalents
When preparing cash flow statement the Company recognized the stock cash and deposits available for payment
at any time as cash and investments featuring with the following four characters at the same time as cash
equivalents: short term (expire within 3 months commencing from purchase day) active liquidity easy to convert
to already-known cash and small value change risks.
9. Foreign currency business and conversion of foreign currency statement
(i) Foreign currency business
The foreign currency business uses the spot exchange rate on the transaction date as the conversion rate to convert
the foreign currency amount into RMB.The balance of foreign currency monetary items on the balance sheet date is converted at the spot exchange rate on
the balance sheet date. The resulting exchange differences except that the balance of exchange generated from the
foreign currency special borrowings related to the assets whose acquisition and construction are eligible for
capitalization is disposed in accordance with the principle of borrowing costs capitalization are included in the
current profit and loss.(ii) Conversion of foreign currency financial statements
Assets and liabilities in the balance sheet are converted at the spot exchange rate on the balance sheet date; except
for the “undistributed profit” item other items of the owner's equity items are converted at the spot exchange rate at
the time of occurrence. Income and expense items in the income statement are converted at the spot exchange rate
on the transaction date.When disposing an overseas operation the translation difference of the foreign currency financial statements related
to the overseas operation is transferred from the owner's equity items to the disposal of the current profit and loss.
10. Financial instruments
Financial instruments include financial assets financial liabilities and equity instruments.
(i) Categories of financial instruments
Accounting policy applicable since 1
st
Jan. 2019
According to the business model of managing financial assets and the contractual cash flow characteristics of
financial assets at initial recognition the Company classifies the financial assets into the financial assets
measured at amortized cost the financial assets(debt instrument) measured at fair value and whose changes are
included in other comprehensive income and the financial assets measured at fair value and whose changes are
included in current gain or loss.90
The financial assets of which the business model aims at the collection of contractual cash flow and the contractual
cash flow is only the payment of the principal and the interest based on the outstanding principal amount are
classified as financial assets measured at amortized cost. The financial assets of which the business model aims not
only at the collection of contractual cash flow but also at selling the financial assets and the contractual cash flow is
only the payment of the principal and the interest based on the outstanding principal amount are classified as
financial assets measured at fair value and whose changes are included in other comprehensive income (debt
instruments). Other financial assets other than this are classified as financial assets measured at fair value and whose
changes are included in current profit and loss.
For non-trading equity instrument investment the Company determines whether it is designated as a financial asset
(equity instrument) measured at fair value and whose changes are included in other comprehensive income at the
initial recognition. In the initial recognition in order to eliminate or significantly reduce accounting mismatches
financial assets can be designated as financial assets measured at fair value and whose changes are included in
current profit and loss.In the initial recognition financial liabilities are classified as the financial liabilities measured at fair value and
whose changes are included in current profit and loss and the financial liabilities measured at amortized cost.
Financial liabilities that meet one of the following conditions can be designated as financial liabilities measured at
fair value and whose changes are included in current profit and loss in the initial measurement:
(1) The designation can eliminate or significantly reduce accounting mismatches.
(2) According to the enterprise risk management or investment strategy specified in the official written document
manage and make performance evaluation of the financial liability portfolio or financial assets and financial
liability portfolio based on fair value and report to the key management personnel based on this.
(3) The financial liability includes embedded derivatives that need to be separately split.
Accounting policy applicable before 1
st
Jan. 2019
At initial recognition financial assets and financial liability are classified as: financial assets or liabilities
measured at fair value and with its variation reckoned into current gains/losses including the transactional
financial assets or financial liabilities and financial assets or liabilities directly designated measured at fair value
and with its variation reckoned into current gains/losses; held-to-maturity investment; account receivable;
financial assets available-for-sale; other financial liability and so on.(ii) Recognition and measurement for financial instrument
Accounting policy applicable since 1
st
Jan. 2019
(1) Financial assets measured at amortized cost
Financial assets measured at amortized cost include notes receivable accounts receivable other receivables
long-term receivables and debt investment which are initially measured at fair value and related transaction costs
are included in the initial recognition amount. The accounts receivable not including major financing components
and the accounts receivable that the Company decides not to consider the financing component of not more than one
year are initially measured at the contract transaction price.91
Interest calculated by the effective interest method during the holding period is included in the current profit and
loss.When recovering or disposing the difference between the price obtained and the book value of the financial asset is
included in the current profit and loss.
(2) Financial assets (debt instruments) measured at fair value and whose changes are included in other
comprehensive income
Financial assets (debt instruments) measured at fair value and whose changes are included in other comprehensive
income including receivables financing other debt investment etc. are initially measured at fair value and related
transaction expenses are included in the initial recognition amount. The financial assets are subsequently measured
at fair value the changes in fair value are included in other comprehensive income except for interest impairment
losses or gains and exchange gains and losses calculated by using the effective interest method.When a financial asset is derecognized the accumulated gain or loss previously included in other comprehensive
income is transferred from other comprehensive income and included in current profit and loss.
(3) Financial assets (equity instruments) measured at fair value and whose changes are included in other
comprehensive income
Financial assets (equity instruments) measured at fair value and whose changes are included in other comprehensive
income including other equity instruments etc. are initially measured at fair value and related transaction
expenses are included in the initially recognised amount. The financial assets are subsequently measured at fair
value and changes in fair value are included in other comprehensive income. The dividends obtained are included in
the current profits and losses.When a financial asset is derecognized the accumulated gain or loss previously included in other comprehensive
income is transferred from other comprehensive income and included in retained earnings.
(4) Financial assets measured at fair value and whose changes are included in current profit and loss
Financial assets measured at fair value and whose changes are included in current profit and loss including
transactional financial assets derivative financial assets and other non-current financial assets etc. are initially
measured at fair value and related transaction expenses are included in the initial recognition amount. The financial
assets are subsequently measured at fair value and changes in fair value are recognised in current profit and loss.When a financial asset is derecognized the difference between its fair value and the initially recorded amount is
recognized as investment income and the gains and losses from changes in fair value are adjusted.
(5) Financial liabilities measured at fair value and whose changes are included in current profit and loss
Financial liabilities measured at fair value and whose changes are included in current profit and loss including
transaction financial liabilities derivative financial liabilities etc. are initially measured at fair value and related
transaction expenses are included in current profit and loss. The financial liabilities are subsequently measured at
fair value and changes in fair value are included in current profit and loss.When a financial liability is derecognized the difference between its fair value and the initially recorded amount is
recognized as investment income and the gains and losses from changes in fair value are adjusted.
(6) Financial liabilities measured at amortized cost
Financial liabilities measured at amortized cost including short-term borrowings bills payable accounts payable
92
other payables long-term borrowings bonds payable and long-term payables are initially measured at fair value
and related transaction expenses are included in the initial recognition amount.Interest calculated by the effective interest method during the holding period is included in the current profit and
loss.When a financial liability is derecognized the difference between the consideration paid and the book value of the
financial liability is included in current profit and loss.
Accounting policy applicable before January 1 2019
(1) Financial assets (financial liabilities) measured at fair value and whose changes are included in current profit
and loss
At the time of acquisition the fair value (deducting the cash dividends that have been declared but not yet paid or the
bond interest whose interest payment has been due but not yet received) is taken as the initial recognition amount
and the related transaction expenses are included in the current profit and loss.
During the holding period the interest or cash dividends are recognized as investment income and the changes in
fair value are included in the current profit and loss at the end of the period.
At the time of disposal the difference between the fair value and the initial recorded amount is recognized as
investment income and the gains and losses from changes in fair value are adjusted.
(2) Held-to-maturity investments
At the time of acquisition the sum of the fair value (deducting the bond interest whose interest payment has been
due but not yet received) and the related transaction expenses is taken as the initial recognition amount.
During the holding period the interest income is calculated and recognized based on the amortized cost and the
actual interest rate and is included in the investment income. The effective interest rate is determined at the time of
acquisition and remains unchanged during the expected duration or for a shorter period of time applicable.
At the time of disposal the difference between the purchase price and the book value of the investment is included
in the investment income.
(3) Account receivable
The contract price charged to the buyers shall be recognized as initial value for those account receivables which
mainly comprise the receivable creditor’s right caused by the sale of goods and providing of labor service to
external customers by the Company and receivables in other companies excluding debt instruments priced in
active markets includes but not limited to account receivables other account receivables and so on. If
characterized as of financing nature the initial recognition shall be priced at the present value.Upon disposal the difference between the sale value and the book value of the receivables shall be accounted into
current profit or loss on its recovery or disposal.
(4) Available-for-sale financial assets
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At the time of acquisition the sum of the fair value (deducting the cash dividends that have been declared but not yet
paid or the bond interest whose interest payment has been due but not yet received) and the related transaction
expenses are taken as the initial recognition amount.
During the holding period the interest or cash dividends obtained are recognized as investment income. At the end
of the period it is measured at fair value and the changes in fair value are included in other comprehensive income.However an equity instrument investment that is not quoted in an active market and whose fair value cannot be
reliably measured and the derivative financial assets that are linked to the equity instrument and that are required to
be settled through the delivery of the equity instrument are measured at cost.
At the time of disposal the difference between the price obtained and the book value of the financial asset is
included in the investment gains and losses. At the same time the amount of the accumulated amount of changes in
fair value originally and directly included in other comprehensive income being corresponding to the disposal
portion is transferred out and included in current profit and loss.
(5) Other financial liabilities
Initial recognition amount is determined at the sum of fair value and relevant transaction fee. Subsequent
measurement is conducted at amortized cost.(iii) Confirmation evidence and measurement methods for transfer of financial assets
When transfer of financial assets occurs the Company shall stop recognition of such financial assets if all
risks and remunerations related to ownership of such financial assets have almost been transferred to the
receiver; while shall continue to recognize such financial assets if all risks and remunerations related to
ownership of such financial assets have almost been retained.When judging whether or not the aforesaid terminal recognition condition for financial assets is arrived at for
transfer of financial assets the Company generally adopts the principle that substance overweighs format. The
Company divides such transfer into entire transfer and part transfer. As for the entire transfer meeting condition
for discontinued recognition balance between the following two items is recorded in current gains and losses:
(1) Carrying value of financial assets in transfer;
(2) Aggregate of the consideration received from transfer and accumulative movements of fair value originally
recorded in owners’ equity directly (applicable when financial assets involved in transfer belong to financial assets
available for sale).
As for the part transfer meeting condition for discontinued recognition entire carrying value of financial assets in
transfer is shared by discontinued recognition part and continued recognition part in light of their respective fair
value. Balance between the following two items is recorded in current gains and losses:
(1) Carrying value of discontinued recognition part;
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(2) Aggregate of the consideration of discontinued recognition part and amount of such part attributable to
accumulative movements of fair value originally recorded in owners’ equity directly (applicable when financial
assets involved in transfer belong to financial assets available for sale).
Financial assets are still subject to recognition if transfer of such assets doesn’t satisfy the condition for
discontinued recognition. And consideration received is recognized as financial liability.(iv) De-recognition condition for financial liability
As for the financial liabilities with its whole or part present obligations released the company shall de-realize
such financial liabilities or part of it. if the company enters into agreement with its creditor to substitute for the
existing financial liabilities by means of assuming new financial liabilities then the company shall de-realize the
existing financial liabilities and realize the new financial liabilities provided that the contract clauses of the new
and the existing financial liabilities are different in substance.If the company makes substantial amendment to the whole or part contract clauses of the existing financial
liabilities it shall de-realize the existing financial liabilities or part of it. Meanwhile the financial liabilities with
amendment to its clauses shall be realized as new financial liabilities.In case of derecognizing of financial liabilities in whole or part the difference between the carrying value of such
de-realized financial liabilities and consideration paid (including the non-cash assets exchanged or new financial
liabilities assumed) shall be recorded in current gains and losses.In case that the company repurchases part of financial liabilities based on the comparative fair value of the
continuing recognition part and the derecognizing part the company shall allocate the carrying value of the
financial liabilities in whole on the repurchase date. Difference between the carrying value allocated to the
derecognizing part and the consideration paid (including the non-cash assets exchanged or new financial liabilities
assumed) shall be recorded in current gains and losses.(v) Determination method for fair value of financial assets and financial liabilities
As for the financial instrument with an active market the fair value is determined by the offer of the active market;
there is no active market for a financial instrument the valuation techniques to determine its fair value. At the
time of valuation the Company adopted applicable in the present case and there is enough available data and
other information technology to support valuation assets or liabilities of feature selection and market participants
in the trading of the underlying asset or liability considered consistent input value and priority as the relevant
observable inputs. Where relevant observable inputs can not get or do not get as far as practicable the use of
unobservable inputs.(vi) Testing of the financial assets (account receivable excluded) impairment and accounting treatment
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Accounting policy applicable from January 1 2019
The Company considers all reasonable and evidence-based information including forward-looking information
and estimates the expected credit losses of the financial assets measured at amortized cost and the financial assets
(debt instruments) measured at fair value and whose changes are included in other comprehensive income on a
single or combination mode.The measurement of expected credit losses depends on whether the credit risks of financial assets have increased
significantly since the initial recognition.If the credit risk of the financial instrument has increased significantly since the initial recognition the Company
measures its loss provision based on the amount equivalent to the expected credit losses for the entire duration of the
financial instrument; if the credit risk of the financial instrument has not increased significantly since the initial
recognition the Company measures its loss provision based on the amount equivalent to the expected credit losses
of the financial instrument in the next 12 months. The increase or reversal amount of the resulting loss provision is
included in the current profit and loss as an impairment loss or gain.Usually if it s overdue for more than 30 days the Company shall believe that the credit risk of the financial
instrument has increased significantly unless there is conclusive evidence that the credit risk of the financial
instrument has not increased significantly since the initial recognition.If the financial instrument's credit risk at the balance sheet date is low the Company shall believe that the credit risk
of the financial instrument has not increased significantly since the initial recognition.
Accounting policy applicable before January 1 2019
Except for financial assets measured at fair value and whose changes are included in current profit and loss the
Company checks the book value of financial assets on the balance sheet date. If there is objective evidence that a
financial asset is impaired make impairment provision.
(1) Provision for impairment of available-for-sale financial assets:
At the end of the period if the fair value of available-for-sale financial assets seriously declines or after
comprehensive consideration of various relevant factors it is expected that such downward trend is non-temporary
it is deemed to have been impaired and the accumulated losses resulting from the decline in the fair value originally
and directly included in the owner's equity are transferred out and the impairment loss is recognized.If there are objective evidences showing that the value of available-for-sale debt instrument is recovered and it
relates to the matters happened after the impairment loss recognition the impairment loss recognized shall be
reversed and accounted in current profit or loss.The impairment loss from equity instrument investment available-for-sale should no be reversed through
gains/losses.Recognition standards for the impairment of equity instrument investment available for sale: The Company has
separately tested various available-for-sale equity instruments at the balance sheet date. It will be defined as
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impairment if the fair value is lower than the initial investment cost by more than 50% (including 50%) or the low
state has lasted for no less than one year. While the lower proportion is between 20% and 50% the Group will
take other factors such as price fluctuation into consideration to estimate whether the equity instrument has
impaired or not.Measurement of the investment cost: Initial segment of the "cost" of the sale of equity instruments in accordance
with available cost less any principal repayment and amortization impairment loss has been included in
determining profit or loss; The fair value of the available-for-sale equity instrument investment without an active
market is determined by the present value determined on the basis of the current market return similar to financial
assets versus the future discounted cash; the fair value of available-for-sale equity instrument investment with
offers in the active market is determined by the closing price of the stock exchange at the end of the period unless
this available-for-sale equity instrument investment has a restricted stock trade period. For the presence of
restricted investments in equity instruments available for sale according to the end of the closing price of the
stock exchange market participants by deducting the risk equity instrument within a specified period cannot be
sold on the open market and the requirements to obtain compensation.
(2) Impairment provision for held-to-maturity investment
Measurement on the impairment loss of held-to-maturity investment reference to the measurement methods and
treatment of impairment losses of account receivable.
11. Note receivable
Same as account receivable
12. Account receivable
(i) Account receivable with single significant amount and withdrawal bad debt provision on single basis
Recognition criteria on account receivable with single significant amount and withdrawal bad debt provision on single basis:
(1)Account receivable: single account receivable has over 10 million Yuan in amount;
(2) Other account receivable: single other account receivable has over 5 million Yuan in amount.
Accrual method for the bad debt provision of account receivable with single significant amount: Conducted
impairment testing separately balance between the present value of future cash flow and its carrying value bad
debt provision withdrawal and reckoned into current gains/losses. For those without impairment being found after
test collected into relevant combination for accrual.(ii) Accounts receivable whose bad debts provision was accrued by combination based on credit risk
characteristics portfolio
(1) Recognition criteria on portfolio
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Receivables with insignificant single amount are classified into several combinations according to the credit risk
characteristics together with the receivables that are not individually impaired after the individual test and have
significant single amount and the provision for bad debts that should be accrued is determined according to the
actual loss rate of the collection of receivables combination with credit risk characteristics similar to previous
years and combined with the current situation.
Basis for determining the portfolio:
Portfolio Accrual method Basis
Related parties in
consolidate scope
Bad debt provision without accrual For receivables among related parties within the scope of
consolidation the possibility of bad debts is very small and no bad
debt provision is made for the portfolio.Specific objects Bad debt provision without accrual For cash deposit security deposit and receivables from government
departments the possibility of bad debts is very small and no bad debt
provision is made for the this portfolio.
Aging analysis Aging analysis Including receivables other than the above portfolios the Company
makes the best estimate on the provision proportion of receivables
based on the past historical experience and refers to the age of
receivables for credit risk portfolio classification.
(2)Accrual method recognized according to portfolio
①By aging analysis
Account age Accrual ratio of the account receivable
(%)
Accrual ratio of the other account receivable
(%)
Within one year 1 1
1－2 years 10 10
2－3 years 30 30
3－4 years 50 50
4－5 years 50 50
Over 5 years 80 80
②Account receivable with minor single amount but withdrawal bad debt provision on single item
Reasons for provision of bad debt reserve: There is objective evidence that the Company will not be able to
recover the money under the original terms of receivables.Provision method of bad debt reserve: Withdrawn according to the difference between present value of expected
future cash flows and the book value of the receivables.98
13. Account receivable financing
Nil
14. Other account receivable
Determining method and accounting treatment on the expected credit loss of other account receivable
As for the measurement of impairment for other account receivable except for account receivables reference to
the “(vi) Testing of the financial assets (account receivable excluded) impairment and accounting treatment ” in
10.Financial instrument above mentioned.
15. Inventory
Does the Company need to comply with disclosure requirements of the special industry?
No
(i) Classification
Inventory includes raw materials work in process-outsourced goods in process finished goods goods in transit
revolving material and wrappage and so on.(ii) Valuation methods for send out stocks
Stocks are valued at time of shipment by weighted average method.(iii) Recognized standards of the net realizable value for inventory
The net realizable value of inventory products and sellable materials in normal business production is
measured as the residual value after deducting the estimated sales expense and related taxes and fees from
the estimated selling price; the net realizable value of an item of inventories subject to further processing
in normal business production is measured as the residual value after deducting the sum of the estimated
costs of completion sales expense and related taxes and fees from the estimated selling price of the
sellable item. The net realizable value of the quantity of inventories held to satisfy firm sales or service
contracts is based on the contract price. If the sales contracts are for less than the inventory quantities held
the net realizable value of the excess is based on general selling prices.
An impairment allowance if any is generally individually recognized for each type of inventories at period-end
except: For an individual impairment allowance if any is recognized for the whole category of inventories of low
value and large quantities; and for an individual impairment allowance if any is recognized for a group of
inventories which are held for the production and sales of products of a single territory and for identical or similar
usages or purposes and which are indistinguishable from other types of inventories within the group.
Except that there is clear evidence indicates that the market price on the balance sheet date is abnormal the net
realizable value of the inventory item is determined based on the market price at the balance sheet date.The net realizable value of the inventory items at the end of the period is determined based on the market price at the
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balance sheet date.(iv) Inventory system
Inventory system is the perpetual inventory system.(v) Amortization of low-value consumables and packaging materials
(1) Low-value consumables adopts the method of primary resale;
(2) Wrappage adopts the method of primary resale.
16. Contract assets
Nil
17. Contract cost
18. Assets held for sale
The Company recognizes the non-current assets or disposal groups that meet both of the following conditions as
the component of available for sale:
(1) According to the practice in similar transactions of selling such assets or disposal groups it can be sold
immediately under current conditions;
(2) The sale is very likely to occur that is the Company has already made a resolution on one sales plan and has
obtained a certain purchase commitment and it is anticipated that the sale will be completed within one year. As
for the assets for sale should be approved by relevant authority organization or supervision department by
regulations the approval has been obtained.
19. Creditors’ investment
Nil
20. Other creditors’ investment
Nil
21. Long-term account receivable
Nil
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22. Long-term equity investment
(i) Criteria for judgment of the common control and significant influence
Common control refers to the control that is common to an arrangement in accordance with the relevant
agreement and the relevant activities of the arrangement must be agreed upon by the participants sharing the
control rights before making a decision. Where the Company and other joint venture parties jointly control the
invested entity and have rights to the net assets of the invested entity the invested entity is the joint venture of the
Company.
Significant influence refers to the right to participate in making decisions relating to the financial and operational
policies of an enterprise while not able to control or jointly control (with others) establishment of these policies.If the Company has significant influence on the invested enterprises than such invested enterprises shall be the
joint venture of the Company.(II) Determination of initial investment cost
(1) Long-term equity investment formed by business combination
Business combination under the same control: If the company pays cash transfers non-cash assets or assumes debts
and issues equity securities as the merger consideration the share of the book value of the acquired owner's equity
of the merged party in the consolidated financial statements of the ultimate controlling party is taken as the initial
investment cost of the long-term equity investment on the merger date. If it is possible to exercise control over the
investee under the same control due to additional investment etc. the initial investment cost of the long-term equity
investment shall be determined according to the share of the book value of the net assets of the merged party in the
consolidated financial statements of the ultimate controlling party on the merger date. The equity premium is
adjusted based on the difference between the initial investment cost of the long-term equity investment on the
combination date and the book value of the long-term equity investment before the merger plus the book value of
the new payment consideration for stock further obtained on the merger date if the equity premium is insufficient to
be offset offset the retained earnings.
Business combination not under the same control: The company take the merger cost determined on the purchase
date as the initial investment cost of the long-term equity investment. If it is possible to control the investee under
the same control due to additional investment etc. the initial investment cost calculated by the cost method is
calculated according to the sum of the book value of the original equity investment plus the new investment cost.
(2) Long-term equity investment required by other ways
For long-term equity investments obtained through payment with cash then the actual payment shall be viewed as
initial investment cost.
For long-term equity investments obtained through issuance of equity securities then the fair value of such
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securities shall be viewed as initial investment cost
Under the precedent condition that non-monetary assets exchanges are featured with commercial nature
and fair values of exchange-in or exchange-out assets can be reliably measured long-term equity
investment exchange-in through non-monetary assets exchange shall be recognized with initial investment
cost on the basis of the fair value of the assets exchange-out unless there is obvious evidence showing that
fair value of exchange-in assets is more reliable; as for non-monetary assets exchanges not satisfying such
precedent condition initial investment cost of exchange-in long-term equity investment falls to the
carrying value of exchange-out assets and relevant taxes payable.
For long-term equity investment obtained through debt restructuring the entry value is determined by the fair value
of the abandoned creditor's right and the taxes directly attributable to the asset and other cost and the difference
between the fair value of the abandoned creditor's right and the book value is included in current profit and loss.(iii) Subsequent measurement and recognition of gains and losses
(1) Long-term equity investment measured by cost
The long-term equity investment for subsidiary shall be measured by cost.Other than payment actually paid
for obtaining investment or cash dividend or profit included in consideration which has been declared
while not granted yet the Company recognizes investment income according to its share in the cash
dividend or profit declared for grant by the invested unit.
(2) Long-term equity investment measured by equity
The Company calculates long term equity investment in associates and joint ventures under equity method. Where
the initial investment cost of a long-term equity investment exceeds the Group’s share of the fair value of the
investee’s identifiable net assets at the time of acquisition no adjustment is made to the initial investment 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 recognized in profit or loss for the period.Return on investments and other comprehensive income is recognized respectively by shares of net gains and
losses realized by the invested company and other comprehensive income and book value of such investment is
adjusted accordingly. Profit or cash dividends pro rata distributed by the invested company are to minus book
value of the relative long-term investment. Book value of long-term investment is adjusted when changes occur
other than net gains and losses other comprehensive income and profit distribution of the invested company and
is to report in owners’ equity accordingly.The Company should recognized net profit of invested unit after adjustment according to the accounting policy
and period of the Company based on fair value of vary identifiable assets of invested unit while obtained
investment while recognized net profit or net losses of invested units that should be enjoy by investment
enterprise. During the period of holding the investment if the investee prepares the consolidated financial statement
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it shall be accounted for a based on the net profit other comprehensive income and the amount attributable to the
investee in changes in the other owner's equity in the consolidated financial statements.The un-realized transaction gains/losses attributable to investment enterprise internally occurred between the
Company affiliated units and joint-ventures should calculated by proportion of shares-holding which should be
offset than recognized investment gains/losses. If the unrealized internal transaction losses with the investee are
assets impairment losses they will be fully recognized. If a transaction of investing or selling assets occurs
between the company and an associate enterprise or joint venture and the assets constitute a business theaccounting treatment shall be handled in accordance with relevant policy policies disclosed in the Notes “5.
Accounting Treatment Methods for Business Combinations Under the Same Control and Not Under the Same
Control” and “6.Methods for Preparing Combined Financial Statements”.When the Company is confirmed to share losses of the invested units the following order shall prevail for
disposal: first of all offset carrying value of long-term equity investment. Second for long-term equity
investment whose carrying value is not enough for offset investment loss should be continued to recognize
within the limit of carrying value of other long-term equity which substantially forms net investment to
invested units to offset carrying value of long-term items receivable. At last after the aforesaid treatment
if enterprise still bears additional duties according to investment contract or agreement projected liabilities
are recognized in accordance to the obligations which are expected to undertake and then recorded in
current gains and losses.
(3) Disposal of long-term equity investment
Difference between carrying value and actual acquisition price in respect of disposal of long term equity
investment shall be included in current period gains and losses.
For long term equity investment under equity method the Company shall adopt the same basis as the investee
directly disposes relevant assets or liabilities when disposing this investment and account for the part originally
included in other comprehensive income under appropriate proportion. The owner's equity recognized as a result
of changes in the owner's equity other than the net profit or loss other comprehensive income and profit
distribution of the investee is carried forward to the current profit and loss in proportion except for other
comprehensive income arising from changes in net liabilities or net assets as the investee re-measures the defined
benefit plans.If the joint control or significant influence on the investee is lost due to the disposal of part of the equity
investment etc. the remaining equity after disposal shall be accounted for according to the recognition and
measurement standard of financial instruments and the difference between the fair value and the book value of
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the day losing the joint control or significant impact is included in the current profit and loss. For other
comprehensive income as recognized under equity method in respect of the original equity investment when the
Company ceases calculation under equity method the aforesaid income shall be accounted for on the same basis
as the investee would otherwise adopt when it directly disposes relevant assets or liabilities. The owner's equity
recognized as a result of changes in the owner's equity other than the net profit or loss other comprehensive
income and profit distribution of the investee is carried forward to the current profit and loss when the equity
method is terminated to be used for business accounting.The Company loses the control over the investee due to the decrease in shareholding ratio caused by the disposal
of part of the equity investment or other investors' capital increase in the subsidiary if the remaining equity can
implement joint control or significant influence on the investee it shall be accounted for according to the equity
method when preparing individual financial statements and the remaining equity shall be adjusted as if it was
accounted for according to the equity method since obtained. If the remaining equity cannot implement joint
control or significant influence on the investee it shall be accounted for according to relevant provisions of the
recognition and measurement standard of financial instruments and the difference between the fair value and the
book value on the date of loss of control is included in current profit and loss.The disposed equity is obtained through business combination for reasons such as additional investment in the
preparation of individual financial statement if the remaining equity after disposal is accounted for by using the
cost method or equity method for the equity investment held before the purchase date other comprehensive income
and other owner's equity recognized due to being accounted for by using the equity method are carried forward on a
pro-rata basis; if the remaining equity after disposal is changed to be accounted for according to the recognition and
measurement standard of financial instruments the other comprehensive income and other owners' equity shall be
entirely carried forward.
23. Investment real estate
Measurement
Measured by cost
Depreciation or amortization method
Investment real estate is defined as the real estate with the purpose to earn rent or capital appreciation or both
including the rented land use rights and the land use rights which are held and prepared for transfer after
appreciation the rented buildings (including the buildings for rent after completion of self-construction or
development activities and the buildings under construction or development for future lease).
Current investment real estate of the Company are measured by cost. As for the investment real estate-rental
building measured by cost the depreciation policy is same as the fixed assets of the Company the land use right
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for rental has the same amortization policy as intangible assets.
Expected service life for the investment real estate an rate of the net salvage value and annual amortization
(depreciation) are as:
Category Expected service life
(year)
Expected net salvage value Annual amortization
(depreciation) rate
Houses and buildings 10-40 5% 2.37%-9.50%
24. Fixed asset
(1)Recognition
Fixed assets is defined as the tangible assets which are held for the purpose of producing goods providing
services lease or for operation & management and have more than one year of service life. Fixed assets should be
recognized for qualified the followed conditions at the same time: (1) It is probable that the economic benefits
associated with the assets will flow into the Company; (2) The cost of the assets can be measured reliably.
(2) Depreciation methods
Category Method Years of depreciation Scrap value rate Yearly depreciation rate
Production buildings Straight-line depreciation 20-35 5 2.71-4.75
Non-production
buildings
Straight-line depreciation 20-35 5 2.71-4.75
Temporary dormitory Straight-line depreciation 20-40 5 2.38-4.75
Simple room etc. Straight-line depreciation 5-15 5 6.33-19
Gas storage bin Straight-line depreciation 20 5 4.75
Silo Straight-line depreciation 50 5 1.9
Wharf and supporting
facilities
Straight-line depreciation 50 5 1.9
Other machinery
equipment
Straight-line depreciation 10-20 5 4.75-9.5
Warehouse transmission
equipment
Straight-line depreciation 20 5 4.75
Electronic equipment Straight-line depreciation 2-5 5 19-47.5
Transport equipment Straight-line depreciation 3-10 5 9.5-31.67
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Other equipment Straight-line depreciation 3-10 5 9.5-31.67
(3) Recognition measurement and depreciation of fixed assets held under finance lease
If any of the following conditions are stipulated in the lease agreement signed by the Company and the lessee it
shall be recognized as a financial leased assets: (1) ownership of the leased assets shall belong to the Company
upon the expiration of the lease term; (2) the Company has the option to purchase assets for a purchase price much
lower than the fair value of the assets when the option is exercised; (3) the lease period accounts for most of the
service life of the leased assets; (4) there is no significant difference between the present value of the minimum
lease payment on the lease commencement date and the fair value of the assets. On the lease start date the
company regards the lower of the fair value of the leased asset and the present value of the minimum lease
payment as the book value of the leased asset and regards the minimum lease payment amount as the book value
of the long-term payable and the difference is regarded as unrecognized financing charges.
25. Construction in progress
Fixed asset is booked with the entire expenditures occurred in the Construction in progress till it arrives at
predicted state for use. For those constructions in process of fixed assets which have already arrived at the
predicted state for use while still with absence of completion settlement they shall be carried forward to
fixed assets at the estimated value based on engineering budget construction cost or actual cost
commencing from the date of arrival of the predicted state for use. Meanwhile they shall be also subject to
the depreciation policies applicable to fixed assets of the Company for provision of depreciation. Once
completion settlement is made the original temporary estimated value shall be adjusted at the effective
cost. However the original provision of depreciation remains unchanged.
26. Borrowing expenses
(i) Recognition of the borrowing expenses capitalization
Borrowing expenses including the amortization of interest discount or premium on borrowing the ancillary
expenses and exchange differences arising from foreign currency borrowings and so on.
Borrowing expenses that attributed for purchasing or construction of assets that are complying start to be
capitalized and counted as relevant assets cost; other borrowing expenses reckoned into current gains and
losses after expenses recognized while occurred.106
Assets satisfying the conditions of capitalization are those assets of fixed investment real estate etc. which need a
long period of time to purchase construct or manufacturing before becoming usable.
Capitalizing for borrowing expenses by satisfying the followed at same time:
(1) Assets expense occurred and paid as expenses in way of cash non-cash assets transfer or debt with
interest taken for purchasing constructing or manufacturing assets that complying with capitalizing
condition;
(2) Borrowing expenses have occurred;
(3) Necessary activities occurred for reaching predicted usable statues or sale-able status for assets
purchased constructed or manufactured.(ii) Period of capitalization
Capitalizing period was from the time star capitalizing until the time of suspended capitalization. The
period for borrowing expensed suspended excluded in the period.If purchasing construction or manufacturing process of an asset satisfying the conditions of capitalization
reached its predicted usable status or sale-able status capitalization suspended for borrowing expenses.If purchasing construction or manufacturing process of an asset satisfying the conditions of capitalization
completed projects and usable independently for part of the projects borrowing expenses for this kind of
assts shall suspended capitalization.If the assets have been completed in every part but can be reached the useful status or sale-able status
while completed entirely the borrowing expense shall be suspended for capitalization while the assets
completely finished in whole.(iii) Period of suspended
If purchasing construction or manufacturing process of an asset satisfying the conditions of capitalization is
suspended abnormally for over 3 months capitalizing of borrowing expenses shall be suspended; the suspended
assets that satisfying the conditions of capitalization meets the necessary procedure of reaching predicted usable
status or sellable status capitalizing of borrowing expenses shall be resumed. The borrowing expenses occurred
during the period of suspended shall reckon into current gains and losses until the purchasing construction or
manufacturing process is resumed for capitalizing.(iv) Capitalization rate of the borrowing costs measurement of the capitalized amount
As for the special loans borrowed for the purchase construction or production of assets eligible for capitalization
the borrowing costs are capitalized by deducting the actual borrowing costs incurred in current period of special
borrowing the interest income earned by borrowing funds that have not ye been used deposited in the bank or the
investment income obtained from the temporary investment.
For the general borrowings used for the acquisition construction or production of assets eligible for capitalization
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the amount of borrowing costs that should be capitalized for general borrowings is calculated and determined
according to the weighted average of the asset expenditures of accumulated asset expenditures over the special
borrowings multiplying by the capitalization rate of the occupied general borrowings. The capitalization rate is
determined based on the weighted average interest rate of general borrowings.
27. Biological assets
(i) Classification of biological assets
Biological assets of the Company refer to the productive biological assets. Productive biological assets included
tea tree.
Biological assets are recognized when the following three conditions are fully satisfied:
(1) An enterprise owns or controls such biological assets due to the past transactions or events；
(2) It may result in the inflow of economic benefits or service potential in relation to such biological assets;
(3) Cost of such biological assets can be reliably measured.
(ii) Initial recognition of Biological assets
The biological assets will initially measured by cost while obtained. The cost of biological asset used for
production purchased from the outside includes the purchase price related taxes transportation expense
insurance premium and other charges directly attributable to the purchase of such asset. Biological asset used for
production input by investors is stated at its entry value which is calculated based on the value as stipulated in the
investment contract or agreement plus the related taxes payable. Where value stipulated in the contract or
agreement is not fair the actual cost is fixed at fair value.(iii) Subsequent measurement of biological assets
(1) Follow-up expenses
The cost of productive biological assets constituted by the actual costs of self-cultivated and constructed
productive biological assets occurred before achieving the intended production and operation goals and the
follow-up expenses such as management and protection occurred after achieving the intended production goals are
included in the current profits and losses.
(2) Depreciation of productive biological assets
Biological assets of the Company refer to the tea plants. For those productive biological assts that reached its
predicted productive purpose withdrawal depreciation by average age method. The service life was determined by
the residual terms of the residual term of land use after deducting the un-maturity period (5-year) of the tea plants
with 5 percent salvage value calculated. Reviewing the service life predicted salvage vale and depreciation
method at year-end if there have difference between the predicted number and original estimated number or have
major changes on way of profit earning than adjusted the service life or predicted salvage value or depreciation
method as account estimation variation.108
(3) Disposal of biological assets:
The cost of biological assets after the shift of use is stated at the carrying amount at the time of shift of use. When
sold destroyed and inventory losses occurred the disposal income of biological assets net of carrying amount and
related taxes shall be charged to profit or loss for the current period.(iv) Biological assets impairment
The Company inspects the productive biological assets at least at the end of each year conclusive evidence
indicates that if the recoverable amount of productive biological assets are less than the book value due to natural
disasters insect pests animal diseases or changes in market demand the Company make the provision for
impairment of biological assets and include them in the current profits and losses according to the balance
between the recoverable amount and the book value.The balance lower than the book value shall be calculated and accrued to falling price reserves or provision for
impairment of biological assets and included in the current profits and losses.Once the provision for impairment of productive biological assets is made it cannot be reversed.
28. Oil and gas assets
Nil
29. Right-of-use assets
Nil
30. Intangible assets
(1) Measurement use of life and impairment testing
(i) Measurement
(1) Initial measurement is made at cost when the Company acquires intangible assets;
For those intangible assets purchased from outside the purchase value relevant taxes and other payments
attributable to predicted purpose obtained should recognized as cost for this assets. For those purchased amount
that paid overdue exceeded the normal credit condition owns financing natures actually the cost should be
recognized based on the current value while purchased.
As for the intangible assets acquired from the debtor in debt restructuring for the purpose of settlement of debt the
fair value of the intangible assets shall be based to determine the accounting value. The difference between the
carrying value of restructured debt and the fair value of the intangible assets use for settlement of debt shall be
109
recorded in current gains and losses.With the preceding conditions that non-monetary assets exchange has commerce nature and the fair value of the
assets exchanged in or out can be measured reliably the intangible assets exchanged in through non-monetary
assets exchange are accounted at the value based on the fair value of assets exchanged out unless there is obvious
evidence showing the fair value of assets exchanged in is more reliable; for non-monetary assets exchange not
qualifying for the preceding conditions the carrying value of assets exchanged out and related taxes payable shall
be viewed as the cost of intangible assets exchanged in without recognition of gains and losses.
(2) Subsequent measurement
Analyzing and judging the service life of an intangible asset when they are acquired.
Those intangible assets with limited useful life are evenly amortized on straight basis from the date when they
become usable to the end of expected useful life;Intangible assets for which it is impossible to predict the term
during which the assets can bring in economic benefits are viewed as intangible assets with indefinite life
without amortization.(ii) Estimation of the service life of intangible assets with limited service life
Those intangible assets with limited useful life are evenly amortized on straight basis from the date when
they become usable to the end of expected useful life. Particular about the estimation on intangible assets
with limited service life:
Item Predicted useful life Basis
Land use right Amortized the actual rest of life after certificate of land use
right obtained
Certificate of land use right
Proprietary technology 20-year Actual situation of the Company
Trademark use right 10-year Actual situation of the Company
Software use right 5-8 years Protocol agreement
Forest tree use right Service life arranged Protocol agreement
Shop management right Service life arranged Protocol agreement
(iii)Judgment basis on intangible assets with uncertain service life and review procedures for the service life
Disclosure requirement: for intangible assets with uncertain service life the judgment basis for uncertain service
life and the procedures for checking their service life should be disclosed.
(2) Accounting policy of the internal R&D expenditure
(i) Specific criteria for dividing research and development stages
The expenditure for internal R&D is divided into research expenditure and development expenditure.Research stage: stage of the investigation and research activities exercising innovative-ness for new science or
110
technology knowledge obtained and understanding.
Development stage: stage of the activities that produced new or material advance materials devices and products
that by research results or other knowledge adoption in certain plan or design before the commercial production or
usage.(ii) Standards for capitalization satisfaction of expenditure in development state
Intangible assets recognized for expenditure in exploitation stage by satisfying the followed at same time:
(1) Owes feasibility in technology and completed the intangible assets for useful or for sale;
(2) Owes the intention for completed the intangible assets and for sale purpose;
(3) Way of profit generated including: show evidence that the products generated from the intangible assets owes
a market or owes a market for itself; if the intangible assets will use internally than show evidence of useful-ness;
(4) Possess sufficient technique financial resources and other resources for the development of kind of intangible
assets and has the ability for used or for sale;
(5) The expenditure attributable to the exploitation stage for intangible assets could be measured reliably.
Expenditure happened in development phase not satisfying the above conditions is included in current
period gains and losses when occurs. Development expenditure previously included in gains and losses in
previous periods will not be re-recognized as assets in later periods. Capitalized development expenditure
is stated in balance sheet as development expenditure and is transferred to intangible assets when the
project is ready for planned use.
31. Impairment of long term assets
The long-term assets as long-term equity investments investment real estate measured at cost fixed assets
construction in progress and intangible assets with certain service life are tested for impairment if there is any
indication that an asset may be impaired at the balance date. If the result of the impairment test indicates that the
recoverable amount of the asset is less than its carrying amount a provision for impairment and an impairment
loss are recognized 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 costs to sell and the present value of the future cash
flows expected to be derived from the asset. Provision for asset impairment is determined and recognized 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 and intangible asset with an indefinite useful life are tested for impairment at least at the end of each year.When the Company conducts the goodwill impairment test the book value of goodwill formed by business
combination is apportioned to the relevant asset group according to reasonable methods from the date of purchase; if
it is difficult to apportion it to the relevant asset group apportion it to the relevant asset group portfolio. When the
111
book value of goodwill is apportioned to the relevant asset group or asset group portfolio it is apportioned
according to the proportion of the fair value of each asset group or asset group portfolio in the total fair value of the
relevant asset group or asset group portfolio. If the fair value is difficult to be reliably measured it is apportioned
according to the proportion of the book value of each asset group or asset group portfolio in the total book value of
the relevant asset group or asset group portfolio.When conducting impairment test for relevant asset group with inclusion of goodwill in case that there is
indication of impairment for such asset group impairment test would be firstly conducted in respect of the asset
groups without inclusion of goodwill. Then it shall calculate the recoverable amount and determine the
corresponding impairment loss as compared to its carrying value. Second asset group with inclusion of goodwill
would be tested for impairment. If it is found after comparison between the carrying value and recoverable
amount of the asset group that the recoverable amount is less than carrying value the Company would recognize
impairment loss for goodwill. Once recognized asset impairment loss would not be reversed in future accounting
period.
32. Long term prepaid expense
Long term prepaid expense represents the expense which the Company has occurred and shall be amortized in the
current and later periods with amortization period exceeding one year. Long term prepaid expense is amortized
during the beneficial period under straight line method.
33. Contract liability
Nil
34. Staff remuneration
(1) Short term remuneration
In the period of employee services short-term benefits are actually recognized as liabilities and charged to profit
or loss or relevant assets costs.Regarding to the social insurance and housing funds that the Company paid for employees the Company should
recognize corresponding employees benefits payable according to the appropriation basis and proportion as
stipulated by relevant requirements and recognize the corresponding liabilities.If the employee welfare are non-monetary benefits and can be measured reliably they shall be measured at fair
112
value.
(2) Accounting treatment for post office benefits
(i) Defined contribution plan
The Company pays basic endowment insurance and unemployment insurance for employees according to the
relevant regulations of the local government. In the accounting period in which employees provide services for the
Company the amount to be paid is calculated according to the local payment base and proportion and is
recognized as a liability and included in current profit and loss or related asset cost.In addition to the basic endowment insurance employees who meet the conditions of the “Enterprise AnnuityScheme of Shenzhen Cereals Group Co. Ltd.” can apply for the annuity plan established by the Company. During
the accounting period when employee provides services for the Company the contribution calculated under
defined withdraw plan would be recognized as liabilities and included in current gains and losses or relevant asset
cost.Other than periodic payment of the aforesaid amounts in compliance with national standards the Company is not
obliged to make other payment.(ii) Defined benefit plan
The Company assigns the benefit obligation arising from the defined benefit plan to the period during which the
employee provides service according to the formula determined by the expected accumulated benefit unit method
and includes it in the current profit and loss or related asset cost.The deficit or surplus formed by the present value of the defined benefit plan obligation minus the fair value of the
defined benefit plan asset is recognized as a net benefit or net asset of the defined benefit plan. If there is a surplus in
the defined benefit plan the Company measures the net assets of the defined benefit plan by the lower of the surplus
and the asset limit of the defined benefit plan.
All defined benefit plan obligations including obligations expected to be paid within twelve months of the end of
the annual reporting period in which the employee provides services are discounted based on the market return of
the national debt matching with the defined benefit plan obligations deadline and currency or the high quality
corporation bonds in an active market on the balance sheet date.The service cost generated by the defined benefit plan and the net liabilities or the net interest of the net assets of the
defined benefit plan are included in the current profit and loss or the related assets cost; the changes generated by the
remeasurement of net liabilities or net assets of the defined benefit plan are included in other comprehensive income
and will not be transferred back to profit or loss in the subsequent accounting period when the original defined
benefit plan is terminated the part that was originally included in other comprehensive income will be carried
forward to undistributed profit within the scope of equity.113
When settling the defined benefit plan the settlement gain or loss is confirmed by the difference between the present
value of the defined benefit plan obligation and the settlement price determined on the settlement date.
(3) Accounting treatment for dismissal benefit
When the Company cannot unilaterally withdraw the dismissal benefits provided by the termination of the labor
relationship plan or the downsizing proposal or when confirm the cost or expenses related to the reorganization of
the dismissal benefits (the earlier one) confirm the employee compensation liabilities generated by dismissal
benefits and include in the current profit and loss.
(4) Accounting treatment for other long term staff benefits
Other long term staff benefits refers to all the other staff benefits except for short term remuneration post office
benefit and dismissal benefit.
For other long term staff benefits satisfying conditions under defined withdraw plan the contribution payables
shall be recognized as liabilities and included in current gains and losses or relevant asset cost during the
accounting period in which the staff provides services to the Company.
35. Lease liability
Nil
36. Accrual liability
(i) Recognition standards for accrual liability
When the obligations relating to contingencies such as litigation debt guarantee loss contract reorganization and
etc. Satisfy the following conditions an accrual liability shall be recognized:
(1)The responsibility is a current responsibility undertaken by the Company;
(2)Fulfilling of the responsibility may lead to financial benefit outflow;
(3)The responsibility can be measured reliably for its value.
(ii) Measurement
114
Accrual liabilities shall conduct initial measurement by best estimation of expenditures needed by fulfillment of
current responsibilities.While determined the best estimation take the risks uncertainty and periodic value of currency that connected to
the contingent issues into consideration. For major influence from periodic value of currency determined best
estimation after discount on future relevant cash out-flow.Treatment for best estimation:
If the expenditure has a continuous range and with similar possibility within the range the best estimation should
determined by the middle value within the range that is the average amount between the up and low limit.If the expenditure has no continuous range or has a continuous range but with different possibility within the
range the possibility amount shall determined as the best estimation while single events involved by contingency;
if many events were involved by contingency the best estimation shall be determined by various results and
relevant probability.If the expenses for clearing of predictive liability is fully or partially compensated by a third party and the
compensated amount can be definitely received it is recognized separated as asset. Though the compensated
amount shall not greater than the book value of the predictive liability
37. Share-based payment
Nil
38. Other financial instrument of preferred stocks and perpetual bond
The Company classifies it as a financial asset a financial liability or an equity instrument at initial recognition based
on the contractual terms of the preferred stock/perpetuity bonds issued and the economic substance it reflects but not
only in legal form.When a financial instrument such as perpetual bond/preferred share issued by the Company satisfies one of the
following conditions classify the financial instrument as a whole or its components as a financial liability at initial
recognition:
(1) There is a contractual obligation that the Company cannot unconditionally avoid performing by cash payment or
other financial assets;
(2) Include contractual obligations that are settled by the delivery of a variable amount of self-equity instruments;
(3)Include derivatives (such as transfer of equity) that are settled by their own interests and the derivative does not
exchange a fixed amount of cash or other financial assets with a fixed amount of its own equity instruments;
115
(4) There are contractual clauses that indirectly form contractual obligations;
(5) The perpetual debt of the issuer is in the same liquidation order as the ordinary bonds and other debts issued by
the issuer at the time of liquidation.
For financial instruments such as perpetual bonds/preferred shares that do not meet any of the above conditions
classify the financial instrument as a whole or its components as equity instrument at the initial recognition.
39. Revenue
Does the Company need to comply with disclosure requirements of the special industry?
No
Whether implemented the new revenue standards
□Yes √No
(i) Sales of goods
When main risks and rewards attached to the ownership of goods have been transferred to the buyer reserved
neither continuous management power nor effective control over the goods incoming payment can be measured
reliably relative financial benefit possibly inflow to the company cost occurred or will occur can be reliably
measured sales income of goods is recognized.The product sales of the Company include domestic sales and export sales the sales revenue of domestic sales is
recognized after the goods is delivered and conforms to the relevant causes of the contract; the sales revenue of
export sales is recognized after the goods is sent out and declared and conforms to the relevant causes of the
contract.(ii) Provide labor services
If the results of the labor service transaction on the balance sheet date can be reliably estimated the labor service
income will be recognized by the percentage of completion method. The completion schedule of the labor service
transaction is determined based on the measurement of the completed work.The results of the labor service transaction can be reliably estimated which means it can meet the following
conditions:
(1) The amount of income can be reliably measured;
(2) The relevant economic benefits are likely to flow into the enterprise;
(3) The completion schedule of the transaction can be reliably determined;
(4) The costs incurred and to be incurred in the transaction can be reliably measured.
The total amount of labor service income is determined by the received or receivable contract or agreement price
except that the contract or agreement price received or receivable is not fair. On the balance sheet date the current
labor service income is determined by the amount that the total labor service income multiplies by the completion
schedule and deducts the accumulated labor income from the previous accounting period. At the same time the
116
current labor cost is carried forward by the amount that the total labor service cost multiplies by the completion
schedule and deducts the accumulated labor cost from the previous accounting period.If the results of the labor service transaction on the balance sheet date cannot be reliably estimated they shall be
disposed as follows:
(1) If the labor costs incurred is estimated to be compensated the labor service income shall be determined
according to the amount of labor costs incurred and the labor costs shall be carried forward at the same amount.
(2) If the labor costs incurred is estimated not to be compensated the labor costs incurred shall be included in the
current profit and loss and the labor service income shall not be recognized.When the contract or agreement signed by the Company with other enterprises includes the sale of goods and the
rendering of labor services if the parts of the sales of goods and the parts of the rendering of labor service can be
distinguished and can be separately measured treat the part of the sales of goods as the sales of goods and treat
the part of the rendering of labor services as rendering of labor services. If the parts of the sales of goods and the
parts of the rendering of labor service cannot be distinguished or can be distinguished but cannot be separately
measured treat the part of the sales of goods and the parts of the rendering of labor service both as the sales of
goods.Recognize revenue for the grain and oil dynamic storage and rotation services provided by the Company for the
Shenzhen Municipal Government when the relevant labor service activities occur. Specifically monthly calculate
and recognize the government service income based on the actual storage grain and oil quantity and the storage
price stipulated by “Operational Procedures for Government Grain Storage All-in Cost of Shenzhen” and
“Operational Procedures for Edible Vegetable Oil Government Reserve All-in Cost of Shenzhen”.(iii) Recognition of the right to use the transferred assets
Financial benefit attached to the contract is possibly inflow to the company; Overall income of the contract can be
measured reliably. Determined the use right income for transaction assets respectively as followed:
(1) Amount of interest income: determined by the time and effective interest rate of the currency capital used by
other people.
(2) Amount of income from use: determined by the charge time and calculation method agreed in the relevant
contract or agreement.
(3) For the income from real estate dock warehouse and other property leasing and terminal docking business
calculate and determine the rental income and warehousing logistics income according to the chargeable time and
method as stipulated in the contract or agreement.
40. Government Grants
(i) Types
Governments grants of the Company refer to the monetary and non-monetary assets obtained from government
117
for free and are divided into those related to assets and others related to revenues.Government grants related to assets refer to those obtained by the Company and used for purchase or construction
of or otherwise to form long-term assets. Government subsidies related to revenue refer to those other than
government subsidies related to assets.Specific criteria for government grants related to assets: the government grants obtained by the Company for the
purchase construction or other formation of long-term assets;
Specific criteria for government grants related to revenue: the government grant other than an asset-related
government grant.(ii) Recognition point of time
At end of the period if there is evidence show that the Company qualified relevant condition of fiscal supporting
polices and such supporting funds are predicted to obtained than recognized the amount receivable as government
grants. After that government grants shall recognize while actually received.Government grants in the form of monetary assets are stated at the amount received or receivable.Government grants in the form of non-monetary assets are measured at fair value; if fair value cannot be
obtained a nominal amount (one yuan) is used. Government grants measured at nominal amount is
recognized immediately in profit or loss for the current period.(iii) Accounting treatment
Government grants related to assets offset the book value of underlying assets or are recognized as deferred income.If they are recognized as deferred income they shall be included in the current profit and loss by stages according to
reasonable and systematic methods within the useful life of the relevant assets. (Those related to the daily activities
of the Company are included in other income; those not related to the daily activities of the Company are included
in the non-operating income);
Government grants related to the income which are used to compensate the related costs or losses of the Company in
the future period are recognized as deferred income are included in the current profit and loss (Those related to the
daily activities of the Company are included in other income; those not related to the daily activities of the
Company are included in the non-operating income) or offset relevant costs or losses during the period of
recognizing the relevant costs or losses; those used to compensate the occurred related costs or losses of the
Company are directly included in the current profit and loss (Those related to the daily activities of the Company
are included in other income; those not related to the daily activities of the Company are included in the
non-operating income) or offset relevant costs or losses.Policy preferential loan interest discounts obtained by the Company are separately accounted for by distinguishing
the following two cases:
(1) The government appropriates the discounted funds to the loan bank the loan bank provides loans to the
118
Company at a policy preferential interest rate the Company uses the actual amount of the borrowed money as the
book value of the loan and calculates the relevant borrowing costs according to the loan principal and the policy
preferential interest rate.
(2) If the government directly appropriates the discounted funds to the Company the Company will offset the
relevant borrowing costs with the corresponding interest discounts.
41. Deferred income tax assets and deferred income tax liabilities
The deferred income tax assets recognised by deductible temporary differences are within the limit of taxable
income that is probably achieved in the future to deduct the deductible temporary differences. The deductible
losses and tax credits that can be carried forward in subsequent years are within the limit of the future taxable
income it is probably achieved in the future to deduct the deductible losses and tax credits and the corresponding
deferred income tax assets are recognized.
For taxable temporary differences deferred income tax liabilities are recognised except in special circumstances.
The special circumstances of not recognizing deferred income tax assets or deferred income tax liabilities include:
initial recognition of goodwill; other transactions or matters other than business combinations that neither affect
accounting profits nor affect taxable income (or deductible losses) when occur.When the Group has a legal right to settle on a net basis and intends either to settle on a net basis or to realize the
assets and settle the liabilities simultaneously current tax assets and current tax liabilities are offset and presented
on a net basis.When the Group has a legal right to settle current tax assets and liabilities on a net basis and deferred tax assets
and deferred tax liabilities relate to income taxes levied by the same taxation authority on either the same taxable
entity or different taxable entities which intend either to settle current tax assets and liabilities on a net basis or to
realize the assets and liabilities simultaneously in each future period in which significant amounts of deferred tax
assets or liabilities are expected to be reversed deferred tax assets and deferred tax liabilities are offset and
presented on a net basis.119
42. Lease
(1) Accounting treatment for operating lease
(i)The rental fee paid for renting the properties by the company are amortized by the straight-line method and
reckoned in the current expenses throughout the lease term without deducting rent-free period. The initial direct
costs related to the lease transactions paid by the company are reckoned in the current expenses.When the lessor undertakes the expenses related to the lease that should be undertaken by the company the
company shall deduct the expenses from the total rental costs share by the deducted rental costs during the lease
term and reckon in the current expenses.(ii)Rental obtained from assets leasing during the whole leasing period without rent-free period excluded shall be
amortized by straight-line method and recognized as leasing revenue. The initial direct costs paid with leasing
transaction concerned are reckoned into current expenditure; the amount is larger is capitalized when incurred
and accounted for as profit or loss for the current period on the same basis as recognition of rental income over the
entire lease period.When the company undertakes the expenses related to the lease that should be undertaken by the lessor the
company shall deduct the expenses from the total rental income and distribute by the deducted rental costs during
the lease term.
(2) Accounting treatment for financing lease
(i) Assets lease-in by financing: On the beginning date of the lease the entry value of leased asset shall be at the
lower of the fair value of the leased asset and the present value of minimum lease payment at the beginning date
of the lease. Minimum lease payment shall be the entry value of long-term accounts payable with difference
recognized as unrecognized financing expenses.Unrecognized financing expenses shall be reckoned in financial expenses and amortized and using effective
interest method during the leasing period. The initial direct expenses incurred by the Company are included in the
value of the rented assets.(ii) Finance leased assets: on the lease commencement date the company affirms the balance among the finance
lease receivables the sum of unguaranteed residual value and its present value as the unrealized financing income
and recognizes it as the rental income during the period of receiving the rent. For the initial direct costs related to
the rental transaction the company reckons in the initial measurement of the finance lease receivables and
reduces the amount of income confirmed in the lease term.120
43. Other important accounting policy and estimation
Safety production expenses
The safety production expenses drawn by the Company in accordance with the national regulations are included in
the cost of relevant products or the current profit and loss and are recorded in the “special reserve” account. When
using the drawn safety production expenses directly offset the special reserve if it belongs to the expense
expenditure. For fixed assets the expenses incurred through the collection of “under construction” subjects shall be
recognized as fixed assets when the safety project is completed and ready for use. At the same time the special
reserve shall be offset according to the cost of forming the fixed assets and accumulated depreciation of the same
amount shall be recognized. The fixed assets will no longer be depreciated in the future.
44. Changes of important accounting policy and estimation
(1)Changes of major accounting policies
□ Applicable √Not applicable
(2) Changes of important accounting estimate
□ Applicable √Not applicable
(3) Adjustment the financial statements at the beginning of the first year of implementation of new financial
instrument standards new revenue standards and new leasing standards
√ Applicable □Not applicable
Consolidate balance sheet
In RMB/CNY
Item 2018-12-31 2019-01-01 Adjustments
Current assets:
Monetary funds 631638339.68 631638339.68
Settlement provisions
Capital lent
Tradable financial assets 1124927.96 1124927.96
Financial assets
measured by fair value and
with variation reckoned into
1124927.96 -1124927.96
121
current gains/losses
Derivative financial
assets
Note receivable 1027635.04 1027635.04
Account receivable 473646886.64 473646886.64
Account receivable
financing
Accounts paid in
advance
83696870.07 83696870.07
Insurance receivable
Reinsurance receivables
Contract reserve of
reinsurance receivable
Other account
receivable
33803428.45 33803428.45
Including: Interest
receivable
561500.00
Dividend
receivable
Buying back the sale of
financial assets
Inventories 2811802600.19 2811802600.19
Contract assets
Assets held for sale
Non-current asset due
within one year
Other current assets 254493764.04 254493764.04
Total current assets 4291234452.07 4291234452.07
Non-current assets:
Loans and payments on
behalf
Creditors’ investment
Available-for-sale
financial assets
57500.00 -57500.00
Other creditors’
investment
Held-to-maturity
122
investment
Long-term account
receivable
Long-term equity
investment
70999666.81 70999666.81
Other equity instrument
investment
Other non-current
financial assets
57500.00 57500.00
Investment real estate 282622184.92 282622184.92
Fixed assets 993136743.51 993136743.51
Construction in progress 186586135.06 186586135.06
Productive biological
asset
407078.92 407078.92
Oil and gas asset
Right-of-use asset
Intangible assets 569997392.08 569997392.08
Expense on Research
and Development
Goodwill
Long-term expenses to
be apportioned
21799899.80 21799899.80
Deferred income tax
asset
50174590.98 50174590.98
Other non-current asset 1936149.72 1936149.72
Total non-current asset 2177717341.80 2177717341.80
Total assets 6468951793.87 6468951793.87
Current liabilities:
Short-term loans 91600000.00 91600000.00
Loan from central bank
Capital borrowed
Tradable financial
liability
Financial liability
measured by fair value and
with variation reckoned into
current gains/losses
123
Derivative financial
liability
Note payable
Account payable 472738283.80 472738283.80
Accounts received in
advance
205428594.16 205428594.16
Selling financial asset of
repurchase
Absorbing deposit and
interbank deposit
Security trading of
agency
Security sales of agency
Wage payable 135709423.52 135709423.52
Taxes payable 24969718.58 24969718.58
Other account payable 280689548.29 280689548.29
Including: Interest
payable
Dividend
payable
2909182.74 2909182.74
Commission charge and
commission payable
Reinsurance payable
Contract liability
Liability held for sale
Non-current liabilities
due within one year
55090793.79 55090793.79
Other current liabilities 219151968.63 219151968.63
Total current liabilities 1485378330.77 1485378330.77
Non-current liabilities:
Insurance contract
reserve
Long-term loans 516687791.66 516687791.66
Bonds payable
Including: preferred
stock
Perpetual
124
capital securities
Lease liability
Long-term account
payable
15690202.08 15690202.08
Long-term wage
payable
Accrual liabilities
Deferred income 100608203.01 100608203.01
Deferred income tax
liabilities
12988434.77 12988434.77
Other non-current
liabilities
Total non-current liabilities 645974631.52 645974631.52
Total liabilities 2131352962.29 2131352962.29
Owners’ equity:
Share capital 1152535254.00 1152535254.00
Other equity instrument
Including: preferred
stock
Perpetual
capital securities
Capital public reserve 1422892729.36 1422892729.36
Less: Inventory shares
Other comprehensive
income
Reasonable reserve 154.21 154.21
Surplus public reserve 327140910.28 327140910.28
Provision of general risk
Retained profit 1269933487.26 1269933487.26
Total owner’s equity
attributable to parent
company
4172502535.11 4172502535.11
Minority interests 165096296.47 165096296.47
Total owner’s equity 4337598831.58 4337598831.58
Total liabilities and owner’s
equity
6468951793.87 6468951793.87
Explanation on adjustment
125
Balance sheet of parent company
In RMB/CNY
Item 2018-12-31 2019-01-01 Adjustments
Current assets:
Monetary funds 168900586.84 168900586.84
Tradable financial assets 1124927.96 1124927.96
Financial assets
measured by fair value and
with variation reckoned into
current gains/losses
1124927.96 -1124927.96
Derivative financial
assets
Note receivable
Account receivable 42441119.07 42441119.07
Account receivable
financing
Accounts paid in
advance
Other account
receivable
159677969.59 159677969.59
Including: Interest
receivable
Dividend
receivable
Inventories 8806338.26
Contract assets
Assets held for sale
Non-current asset due
within one year
Other current assets 50068745.74 50068745.74
Total current assets 431019687.46 431019687.46
Non-current assets:
Creditors’ investment
Available-for-sale
financial assets
Other creditors’
126
investment
Held-to-maturity
investment
Long-term account
receivable
Long-term equity
investment
4212554063.36 4212554063.36
Other equity instrument
investment
Other non-current
financial assets
Investment real estate 17929684.70 17929684.70
Fixed assets 31417912.54 31417912.54
Construction in progress
Productive biological
asset
407078.92 407078.92
Oil and gas asset
Right-of-use asset
Intangible assets 6663692.30 6663692.30
Expense on Research
and Development
Goodwill
Long-term expenses to
be apportioned
409621.50 409621.50
Deferred income tax
asset
5630538.80 5630538.80
Other non-current asset
Total non-current asset 4275012592.12 4275012592.12
Total assets 4706032279.58 4706032279.58
Current liabilities:
Short-term loans
Tradable financial
liability
Financial liability
measured by fair value and
with variation reckoned into
current gains/losses
127
Derivative financial
liability
Note payable
Account payable 73705646.54 73705646.54
Accounts received in
advance
124945.74 124945.74
Contract liability
Wage payable 6448561.16 6448561.16
Taxes payable 2702655.24 2702655.24
Other account payable 232109084.76 232109084.76
Including: Interest
payable
Dividend
payable
Liability held for sale
Non-current liabilities
due within one year
Other current liabilities
Total current liabilities 315090893.44 315090893.44
Non-current liabilities:
Long-term loans
Bonds payable
Including: preferred
stock
Perpetual
capital securities
Lease liability
Long-term account
payable
Long-term wage
payable
Accrual liabilities
Deferred income 46129.96 46129.96
Deferred income tax
liabilities
10965.46 10965.46
Other non-current
liabilities
128
Total non-current liabilities 57095.42 57095.42
Total liabilities 315147988.86 315147988.86
Owners’ equity:
Share capital 1152535254.00 1152535254.00
Other equity instrument
Including: preferred
stock
Perpetual
capital securities
Capital public reserve 3018106568.27 3018106568.27
Less: Inventory shares
Other comprehensive
income
Reasonable reserve
Surplus public reserve 54736482.14 54736482.14
Retained profit 165505986.31 165505986.31
Total owners’ equity 4390884290.72 4390884290.72
Total liabilities and owner’s
equity
4706032279.58 4706032279.58
Explanation on adjustment
(4) Retrospective adjustment of early comparison data description when initially implemented the new
financial instrument standards and new leasing standards
□ Applicable √Not applicable
45. Other
VI. Taxes
1. Type of tax and rate for main applicable tax
Taxes Basis Rate
VAT
The output tax is calculated on the basis of
the sales of goods and the taxable service
income calculated according to the tax law.
After deducting the input tax amount that
is allowed to be deducted in the current
period the difference part is the
16% 10% 6% 5% 3%
129
value-added tax payable.Urban maintenance and construction tax Turnover tax payable 7% 5%
Enterprise income tax Taxable income 25% 15% 0%
Educational surtax Turnover tax payable 5%
Rate of enterprise income tax for different taxpaying body:
Taxpaying body Income tax rate
The Company 25%
Shenbao Huacheng 15%
Including: Shantou Branch of Shenbao Huacheng 25%
Wuyuan Ju Fang Yong 15%
Shenbao Sanjing 25%
Huizhou Shenbao Technology 25%
Huizhou Shenbao Food 25%
Shenbao Property 25%
Shenbao Industrial & Trading 25%
Hangzhou Ju Fang Yong 25%
Shenbao Technology Center 25%
Fuhaitang Ecological 25%
Chunshi Network 25%
Shenshenbao Investment 25%
Shenshenbao Tea Culture 25%
Yunnan Supply Chain 25%
Ju Fang Yong Trading 25%
Shenbao Rock Tea 25%
Pu’er Tea Trading Center 25%
Shenbao Tea-Shop 25%
Fuhaitang Catering 25%
SZCG 25% tax exemption for some businesses
Shenliang Real Estate Development 25%
Shenzhen Flour Tax free
Shenliang Quality Inspection 25%
Hualian Grain & oil trading 25%
130
Shenliang Cold-Chain Logistic 15%
Shenliang Doximi 25%
Hainan Haitian 25%
Dongguan Shenliang Logistics 25%
Shenliang Big Kitchen 15%
Shenliang Storage (Yingkou) ) 25%
Shenliang Property 25%
Dongguan Food Industrial Park 25%
Dongguan Food Trade 25%
Dongguan Jinying 25%
Shuangyashan Shenliang Zhongxin 25%
Hongxinglong Nongken Industrial Park 25%
2. Tax preferential
(i)VAT discounts and approval
According to the “Notice of the Ministry of Finance and the State Administration of Taxation on the Issues
Concerning the VAT Collection and Exemption of Grain Enterprises (CSZ [1999] No. 198)” and “Shenzhen TaxService State Taxation Administration and Shenzhen Finance Bureau SGSF (SCF [1999] No.428)” confirming
that SZCG the Company’s subsidiary and its subsidiaries are state-owned grain purchase and sale enterprises
that undertake grain collection and storage tasks for Shenzhen the grain sold is subject to tax-free declaration byrule and enjoys the exemption from VAT. In addition according to the stipulation of the “Announcement of State
Administration of Taxation on Relevant Management Matters After Clarifying the Cancellation of the Approval ofSome VAT Preferential Policies” (SAT Announcement 2015 No. 38) the approval for exemption from VAT and
the involved tax review and approval procedures for the state-owned grain enterprises that undertake grain
collection and storage tasks other grain enterprises that operate tax-free projects and enterprises that have edible
vegetable oil sales business for government reserves are cancelled and changed to record management. The
taxpayer does not change the content of the record materials during the period of tax exemption can be put on a
one-time record. In December 2013 SZCG obtained the notice of the VAT preferential record (SGSFJBM [2013]
No.2956) from Shenzhen Futian State Administration of Taxation. In the case of no change in policy this limited
filing period started on January 1
st
2014. The VAT input tax amount of the preferential item was separately
accounted for and the input VAT calculation method cannot be changed within 36 months after the selection. As
of December 31 2018 the tax exemption policy has been in effect since its filing in 2014 and the company’s VAT
input tax has not changed since it was accounted for separately in 2014 so the company continues to enjoy the tax
preference.(ii) Stamp duty house property tax and urban land use tax preferences
According to the stipulations of “Notice of the Ministry of Finance and the State Administration of Taxation on131the Relevant Tax Policies Concerning Some National Reserved Commodities (CS [2019] No. 77)” confirming
that the fund account book of SZCG the Company’s subsidiary and its direct depots is exempt from stamp duty
confirming that the written purchase and sale contracts of SZCG in the process of undertaking the commodity
reserve business are exempt from stamp duty and confirming that SZCG’s house property and land used for the
commodity reserve business are exempt from house property tax and urban land use tax. The execution time limit
for this tax preference policy is up to December 31 2021.(iii) Enterprise income tax
(1) Shenbao Huacheng a subsidiary of the Company obtained the “High-tech Enterprise Certificate” (Certificate
number is GR201744203462) jointly issued by Shenzhen Science and Technology Innovation Committee
Shenzhen Financial Committee Shenzhen Tax Service State Taxation Administration and Shenzhen Local
Taxation Bureau on October 31 2017 which is valid for three years. According to the relevant preferential
policies of the state for high-tech enterprises the qualified high-tech enterprises shall pay the corporate income
tax at a reduced income tax rate of 15% within three years from the year of the determination and Shenbao
Huacheng enjoys the tax preferential policy from 2017 to 2019.
(2) The Company’s subsidiary Wuyuan Jufangyong obtained the “High-tech Enterprise Certificate” (Certificate
number is GR201836000703) jointly issued by the Science and Technology Department of Jiangxi Province the
Finance Department of Jiangxi Province and Jiangxi Provincial Tax Service State Taxation Administration on
August 13 2018 which is valid for three years. According to the relevant preferential policies of the state for
high-tech enterprises the qualified high-tech enterprises shall pay the corporate income tax at a reduced income
tax rate of 15% within three years from the year of the determination and Wuyuan Jufangyong enjoys the tax
preferential policy from 2018 to 2020.
(3) According to the “Notice on the Issues Concerning the Treatment of Corporate Income Taxes for Fiscal Fundsof Special Purposes of the Ministry of Finance and the State Administration of Taxation (CS [2009] No. 87) the
government service income obtained by SZCG the Company’s subsidiary and its subsidiaries from the
government’s grain reserve business is a special-purpose fiscal fund which can be used as non-taxable income if
eligible and is deducted from the total income when calculating the taxable income. The expenses arising from the
above-mentioned non-taxable income for expenditure shall not be deducted when calculating the taxable income;
the calculated depreciation and amortization of the assets formed by non-taxable income for expenditure shall not
be deducted when calculating the taxable income.
(4) Shenzhen Flour a subsidiary of the Company is a flour primary processing enterprise according to thestipulations of the “Notice on Issuing the Scope (Trial) of Primary Processing of Agricultural Products Applicableto the Corporate Income Tax Preferential Policy (CS [2008] No. 149)” and the “Supplementary Notice on theScope of Primary Processing of Agricultural Products Applicable to the Corporate Income Tax Preferential Policy
132of the Ministry of Finance and the State Administration of Taxation” (CS [2011] No. 26) the wheat primary
processing is exempt from income tax.
(5) According to the Article one of the “Notice of the Ministry of Finance and the State Administration of Taxationon the Corporate Income Tax Preferential Policies and Preferential Catalogue for Guangdong Hengqin New
District Fujian Pingtan Comprehensive Experimental Zone and Shenzhen Qianhai Shenzhen-Hong KongModern Service Industry Cooperation Zone” (CS [2014] No.26) levy the corporate income tax at a reduced
income tax rate of 15% for the encouraged industrial enterprises located in Hengqin New District Pingtan
Comprehensive Experimental Zone and Qianhai Shenzhen-Hong Kong Modern Service Industry Cooperation
Zone. The Company’s subsidiaries Shenliang Cold-Chain Logistic and Shenliang Big Kitchen are registered in
Shenzhen Qianhai Cooperation Zone and meet the preferential tax conditions according to the relevant policies in
the Cooperation Zone their income tax enjoys a tax preference of 15% and this preferential tax policy shall be up
to 2020.
3. Other
Nil
VII. Annotation to main items of consolidated financial statements
1. Monetary funds
RMB/CNY
Item Ending balance Opening balance
Cash on hand 248295.15 282322.45
Cash in bank 189525109.14 631190032.12
Other monetary fund 141081.10 165985.11
Total 189914485.39 631638339.68
Other explanation
The Company did not has account pledge freeze or has potential risks in collection ended as 30 June 2019
2. Tradable financial assets
RMB/CNY
Item Ending balance Opening balance
Financial assets measured by fair value and
with variation reckoned into current
gains/losses
1153309.17 1124927.96
Including:
133
Equity investment instrument 1153309.17 1124927.96
Including:
Total 1153309.17 1124927.96
Other explanation:
Ending balance refers to the 258011 shares of A-stock under the name of “CBC-A”
3. Derivative financial assets
RMB/CNY
Item Ending balance Opening balance
Other explanation:
4. Note receivable
(1) Category
RMB/CNY
Item Ending balance Opening balance
Bank acceptance bill 350756.64 1027635.04
Total 350756.64 1027635.04
RMB/CNY
Category
Ending balance Opening balance
Book balance Bad debt provision
Book
value
Book balance Bad debt provision
Book
value Amount Ratio Amount
Accrual
ratio
Amount Ratio Amount
Accrual
ratio
Including:
Including:
Bad debt provision accrual on single basis:
RMB/CNY
Name
Ending balance
Book balance Bad debt provision Accrual ratio Accrual causes
Bad debt provision accrual on portfolio:
RMB/CNY
Name
Ending balance
Book balance Bad debt provision Accrual ratio
Explanation on portfolio determines:
134
If the provision for bad debts of note receivable is made in accordance with the general model of expected credit losses please refer to
the disclosure of other account receivables to disclose related information about bad-debt provisions:
□ Applicable √Not applicable
(2) Bad debt provision accrual collected or reversal in the period
Bad debt provision accrual in the period:
RMB/CNY
Category Opening balance
Amount changed in the period
Ending balance
Accrual Collected or reversal Written-off
Including major amount bad debt provision that collected or reversal in the period:
□ Applicable √Not applicable
(3) Note receivable that pledged at period-end
RMB/CNY
Item Amount pledged at period-end
(4) Notes endorsement or discount and undue on balance sheet date
RMB/CNY
Item Amount derecognition at period-end Amount not derecognition at period-end
(5) Notes transfer to account receivable due for failure implementation by drawer at period-end
RMB/CNY
Item Amount transfer to account receivable at period-end
Other explanation
(6) Note receivable actually written-off in the period
RMB/CNY
Item Amount written-off
Including important note receivable that written-off:
RMB/CNY
Enterprise Nature Amount written-off Written-off causes
Procedure of
written-off
Resulted by related
transaction (Y/N)
Explanation on note receivable written-off
135
5. Account receivable
(1)Category
RMB/CNY
Category
Ending balance Opening balance
Book balance Bad debt provision
Book
value
Book balance Bad debt provision
Book value
Amount Ratio Amount
Accrual
ratio
Amount Ratio Amount
Accrual
ratio
Account receivable
with bad debt
provision accrual on
a single basis
100508
379.06
13.91%
987544
48.60
98.25%
1753930
.46
1009208
79.06
17.40%
9916694
8.60
98.26%
1753930.4
6
Including:
Account receivable
with single
significant amount
and withdrawal bad
debt provision on
single basis
104556
27.54
1.45%
104556
27.54
100.00%
1045562
7.54
1.80%
1045562
7.54
100.00%
Account receivable
with single minor
amount but with bad
debts provision
accrued on a single
basis
900527
51.52
12.46%
882988
21.06
98.05%
1753930
.46
9046525
1.52
15.60%
8871132
1.06
98.06%
1753930.4
6
Account receivable
with bad debt
provision accrual on
portfolio
622241
934.11
86.09%
616469
6.86
0.99%
6160772
37.25
4790589
35.68
82.60%
7165979
.50
1.50%
47189295
6.18
Including:
Related party and
petty cash
159082
329.20
22.01%
1590823
29.20
3790455
9.66
6.54%
37904559.
66
Age portfolio
463159
604.92
64.08%
616469
6.86
1.33%
4569949
08.06
4411543
76.02
76.06%
7165979
.50
1.62%
43398839
6.52
Total
722750
313.17
100.00%
104919
145.46
14.52%
6178311
67.71
5799798
14.74
100.00%
1063329
28.10
18.33%
47364688
6.64
Bad debt provision accrual on single basis:10455627.54 Yuan
RMB/CNY
Name Ending balance
136
Book balance Bad debt provision Accrual ratio Accrual causes
Account receivable with
single significant amount
and withdrawal bad debt
provision on single basis
Guangzhou Jinhe Feed
Co. Ltd
10455627.54 10455627.54 100.00%
Slightly possibly taken
back
Total 10455627.54 10455627.54 -- --
Bad debt provision accrual on single basis: 88298821.06 Yuan
RMB/CNY
Name
Ending balance
Book balance Bad debt provision Accrual ratio Accrual causes
Account receivable with
single minor amount but
with bad debts provision
accrued on a single basis
at period-end
Shenzhen Faqun
Industrial Co. Ltd.
4582156.00 4582156.00 100.00%
Slightly possibly taken
back
Li Shaoyu 2929128.53 2929128.53 100.00%
Slightly possibly taken
back
Zhuhai Doumen Huabi
Feed Co. Ltd
2396327.14 2396327.14 100.00%
Slightly possibly taken
back
Chongqing Zhongxing
Food Industry Co. Ltd.
2354783.30 2354783.30 100.00%
Slightly possibly taken
back
Hengyang Feed Plant 1907679.95 1907679.95 100.00%
Slightly possibly taken
back
Beijing Zhongwang Food
Co. Ltd.
1873886.58 1873886.58 100.00%
Slightly possibly taken
back
Sichuan Zhongxing Food
Industry Co. Ltd.
1698103.22 1698103.22 100.00%
Slightly possibly taken
back
Shenzhen Buji
Agricultural Products
Wholesale Center Market
Xingmin Commercial
Shop
1534512.45 1534512.45 100.00%
Slightly possibly taken
back
Other account receivable
with over 3 years for
Slightly possibly taken
70776174.35 69022243.89 97.52%
Slightly possibly taken
back
137
back
Total 90052751.52 88298821.06 -- --
Bad debt provision accrual on single basis:
RMB/CNY
Name
Ending balance
Book balance Bad debt provision Accrual ratio Accrual causes
Bad debt provision accrual on portfolio: 6164696.86Yuan
RMB/CNY
Name
Ending balance
Book balance Bad debt provision Accrual ratio
Within one year 459556076.84 4595560.77 1.00%
1-2 years 1082033.98 108203.40 10.00%
2-3 years 311445.72 93433.72 30.00%
3-4 years 1057518.76 528759.39 50.00%
4-5 years 277613.73 138806.87 50.00%
Over 5 years 874915.89 699932.71 80.00%
Total 463159604.92 6164696.86 --
Explanation on portfolio determines:
Bad debt provision accrual on portfolio:
RMB/CNY
Name
Ending balance
Book balance Bad debt provision Accrual ratio
Explanation on portfolio determines:
If the provision for bad debts of account receivable is made in accordance with the general model of expected credit losses please refer
to the disclosure of other account receivables to disclose related information about bad-debt provisions:
□ Applicable √Not applicable
By account age
RMB/CNY
Account age Ending balance
Within one year(one year included) 617070571.01
Within one year(one year included) 617070571.01
1-2 years 1082033.98
2-3 years 311445.72
Over 3 years 104286262.46
3-4 years 1057518.76
138
4-5 years 277613.73
Over 5 years 102951129.97
Total 722750313.17
(2) Bad debt provision accrual collected or reversal in the period
Bad debt provision accrual in the period:
RMB/CNY
Category Opening balance
Amount changed in the period
Ending balance
Accrual Collected or reversal Written-off
Bad debt provision
accrual on single
basis
99166948.60 412500.00 98754448.60
Age portfolio 7165979.50 252985.38 1254268.02 6164696.86
Total 106332928.10 252985.38 1666768.02 104919145.46
Including major amount bad debt provision that collected or reversal in the period:
RMB/CNY
Enterprise Amount collected or reversal Collection way
(3) Account receivable actually written-off in the period
RMB/CNY
Item Amount written-off
Including major account receivable written-off
RMB/CNY
Enterprise Nature Amount written-off Written-off causes
Procedure of
written-off
Resulted by related
transaction (Y/N)
Explanation on account receivable written-off
(4) Top 5 account receivables at ending balance by arrears party
Total period-end balance of top five receivables by arrears party amounting to 447155799.70 Yuan takes 61.87 percent of the total
account receivable at period-end bad debt provision accrual correspondingly at year-end amounting as 722114.57 Yuan.139
(5) Account receivable derecognition due to financial assets transfer
(6) Assets and liabilities resulted by account receivable transfer and continues involvement
Other explanation:
6. Account receivable financing
RMB/CNY
Item Ending balance Opening balance
Changes of account receivable financing and change of fair value in the period
□ Applicable √Not applicable
If the impairment provision of account receivable financing is made in accordance with the general model of expected credit losses
please refer to the disclosure of other account receivables to disclose related information about impairment provision:
□ Applicable √Not applicable
Other explanation:
7. Accounts paid in advance
(1) By account age
RMB/CNY
Account age
Ending balance Opening balance
Amount Ratio Amount Ratio
Within one year 25907038.42 98.91% 83282051.24 99.51%
1-2 years 22283.22 0.09% 70556.78 0.08%
2-3 years 7670.34 0.01%
Over 3 years 260606.46 1.00% 336591.71 0.40%
Total 26189928.10 -- 83696870.07 --
Explanation on reasons of failure to settle on important account paid in advance with age over one year
The closing balance of prepayments decreased by RMB 57506941.97 compared with the beginning of the period with a decrease ratio
of 69% it was mainly because the Company’s subsidiary Dongguan Shenliang Logistics signed a purchase contract with Xiamen
Mingsui Grain and Oil Trading Co. Ltd. and prepaid the payment at the end of December 2018 resulting in large balance of the
payment at the beginning of the period.140
(2) Top 5 account paid in advance at ending balance by prepayment object
Total period-end balance of top five account paid in advance by prepayment object amounted to 21379819.55 Yuan takes 81.63
percent of the total advance payment at period-end.Other explanation:
8. Other account receivable
RMB/CNY
Item Ending balance Opening balance
Interest receivable 561500.00
Other account receivable 57624419.71 33241928.45
Total 57624419.71 33803428.45
(1) Interest receivable
1) Category
RMB/CNY
Item Ending balance Opening balance
Time deposit 561500.00
Total 561500.00
2) Significant overdue interest
RMB/CNY
Borrower Ending balance Overdue time Overdue causes
Whether impairment
occurs and its judgment
basis
Other explanation:
3) Accrual of bad debt provision
□ Applicable √Not applicable
(2) Dividend receivable
1) Category
RMB/CNY
Item (or invested enterprise) Ending balance Opening balance
2) Important dividend receivable with account age over one year
RMB/CNY
Item (or invested
enterprise)
Ending balance Account age
Reasons for not
collection
Whether impairment
occurs and its judgment
141
basis
3) Accrual of bad debt provision
□ Applicable √Not applicable
Other explanation:
(3) Other account receivable
1) By nature
RMB/CNY
Nature Ending book balance Opening book balance
Margin and deposit 45434104.15 11160677.29
Export tax rebate 3085206.14 312364.06
Intercourse funds and other 101951791.76 119759129.21
Total 150471102.05 131232170.56
2) Accrual of bad debt provision
RMB/CNY
Bad debt provision
Phase I Phase II Phase III
Total
Expected credit
losses over next 12
months
Expected credit losses for
the entire duration (without
credit impairment occurred)
Expected credit losses for
the entire duration (with
credit impairment occurred)
Balance on Jan. 1 2019 91037.53 7300675.36 90598529.22 97990242.11
Balance of Jan. 1 2019
in the period
—— —— —— ——
Current accrual 12330.41 204763.49 217093.90
Current reversal 5360653.67 5360653.67
Balance on Jun. 30 2019 103367.94 1940021.69 90803292.71 92846682.34
Change of book balance of loss provision with amount has major changes in the period
□ Applicable √Not applicable
By account age
RMB/CNY
Account age Ending balance
Within one year(one year included) 50038334.00
Within one year(one year included) 50038334.00
1-2 years 4038032.96
2-3 years 947859.87
Over 3 years 95446875.22
3-4 years 112539.37
142
4-5 years 930794.83
Over 5 years 94403541.02
Total 150471102.05
3) Bad debt provision accrual collected or reversal in the period
Bad debt provision accrual in the period:
RMB/CNY
Category Opening balance
Amount changed in the period
Ending balance
Accrual Collected or reversal
Other account receivable
with single minor amount
but with bad debt
provision accrual on
single basis
44887199.60 44887199.60
Other account receivable
with single major amount
and with bad debt
provision accrual on
single basis
45711329.62 204763.49 45916093.11
Aging analysis portfolio 7391712.89 12330.41 5360653.67 2043389.63
Total 97990242.11 217093.90 5360653.67 92846682.34
Including major amount with bad debt provision reverse or collected in the period:
RMB/CNY
Enterprise Amount reversal or collected Collection way
Shenzhen Yixin Investment Co. Ltd 5111304.11 Amount collected
Total 5111304.11 --
4) Other account receivable actually written-off in the period
RMB/CNY
Item Amount written-off
Including important other account receivable written-off
RMB/CNY
Enterprise Nature Amount written-off Written-off causes
Procedure of
written-off
Resulted by related
transaction (Y/N)
Explanation on other account receivable written-off
5) Top 5 other receivables at ending balance by arrears party
RMB/CNY
Enterprise Nature Ending balance Account age
Ratio in total ending
balance of other
account receivables
Ending balance of
bad debt reserve
143
Changzhou Shenbao
Chacang E-business
Co. ltd.
Intercourse funds 20618710.83
Within one year;
1-4 year and above
13.70% 18024144.51
Shenzhen Gaojian
Food Joint Venture
Co. Ltd
Intercourse funds 8326202.63 Over 5 years 5.53% 416310.13
Shenzhen Sha Tau
Kok Import &
Export Corporation
Intercourse funds 8285803.57 Over 5 years 5.51% 414290.18
Jinzhou Tianli Grain
Trading Co. Ltd.Margin 5743108.32 Within one year 3.82% 287155.42
Shenzhen
Changjiang
Development Co.
Ltd.Intercourse funds 5677473.59 Over 5 years 3.77% 283873.68
Total -- 48651298.94 -- 32.33% 19425773.92
6) Other account receivables related to government grants
RMB/CNY
Enterprise Government grants Ending balance Ending account age
Time amount and basis
for collection predicted
7) Other receivable for termination of confirmation due to the transfer of financial assets
8) The amount of assets and liabilities that are transferred other receivable and continued to be involved
Other explanation:
9. Inventories
Whether implemented the new revenue standards
□Yes √No
(1) Category
RMB/CNY
Item
Ending balance Opening balance
Book balance
Falling price
reserves
Book value Book balance
Falling price
reserves
Book value
Raw materials 68342539.38 24106831.49 44235707.89 63928125.50 19906198.09 44021927.41
Goods in process 13823647.30 13823647.30 23840568.24 68371.10 23772197.14
Finished goods 3079344347.80 95464608.75 2983879739.05 2827653415.87 101081767.83 2726571648.04
Revolving
material
9752899.65 1618111.19 8134788.46 10843165.99 941939.14 9901226.85
144
Goods in transit 3409547.41 3409547.41 7410407.72 7410407.72
Work in
process-outsource
d
109884.08 109884.08 5415695.35 5290502.32 125193.03
Total 3174782865.62 121189551.43 3053593314.19 2939091378.67 127288778.48 2811802600.19
Whether the Company needs to comply with the disclosure requirement of Industry Information Disclosure Guidelines of Shenzhen
Stock Exchange No.4 -Listed Companies Engaged in Seed Planting Business
No
(2)Falling price reserves of inventories
RMB/CNY
Item Opening balance
Current amount increased Current amount decreased
Ending balance
Accrual Other
Reversal or
write-off
Other
Raw materials 19906198.09 8220891.21 4020257.81 24106831.49
Goods in process 68371.10 68371.10
Finished goods 101081767.83 54067440.32 59684599.40 95464608.75
Revolving
material
941939.14 676172.05 1618111.19
Goods in transit
Work in
process-outsource
d
5290502.32 5290502.32
Total 127288778.48 62964503.58 69063730.63 121189551.43
(3) Explanation on inventories with capitalization of borrowing costs included at ending balance
Nil
(4) Assets unsettled formed by construction contract which has completed at period-end
RMB/CNY
Item Amount
Other explanation:
10. Contract assets
RMB/CNY
Item Ending balance Opening balance
145
Book balance
Impairment
provision
Book value Book balance
Impairment
provision
Book value
Amount and reasons for the major changes of book value of contract assets in the period
RMB/CNY
Item Amount changed Cause of change
If the bad debt provision of accrual contract is made in accordance with the general model of expected credit losses please refer to the
disclosure of other account receivables to disclose related information about bad debt provision:
□ Applicable √Not applicable
Impairment provision of contract assets in the period
RMB/CNY
Item Current accrual Current reversal Charge off/Written-off Causes
Other explanation:
11. Assets held for sale
RMB/CNY
Item
Ending book
balance
Impairment
provision
Ending book
value
Fair value
Estimated
disposal cost
Estimated
disposal time
Other explanation:
12. Non-current asset due within one year
RMB/CNY
Item Ending balance Opening balance
Important creditors’ investment/Other creditors’ investment
RMB/CNY
Item
Ending balance Opening balance
Face value Coupon rate Actual rate
Maturity
date
Face value Coupon rate Actual rate
Maturity
date
Other explanation:
13. Other current assets
Whether implemented the new revenue standards
□Yes √No
RMB/CNY
Item Ending balance Opening balance
Enterprise income tax paid in advance 9719.32 394677.16
146
VAT input tax ready for deduction 78086632.70 88918809.39
Financial products held to maturity within
one year
30000000.00 160000000.00
Other 2315.03 5180277.49
Total 108098667.05 254493764.04
Other explanation:
14. Creditors’ investment
RMB/CNY
Item
Ending balance Opening balance
Book balance
Impairment
provision
Book value Book balance
Impairment
provision
Book value
Important creditors’ investment
RMB/CNY
Item
Ending balance Opening balance
Face value Coupon rate Actual rate
Maturity
date
Face value Coupon rate Actual rate
Maturity
date
Accrual of impairment provision
RMB/CNY
Bad debt provision
Phase I Phase II Phase III
Total
Expected credit
losses over next 12
months
Expected credit losses for
the entire duration (without
credit impairment occurred)
Expected credit losses for
the entire duration (with
credit impairment occurred)
Balance of Jan. 1 2019
in the period
—— —— —— ——
Change of book balance of loss provision with amount has major changes in the period
□ Applicable √Not applicable
Other explanation:
15. Other creditors’ investment
RMB/CNY
Item
Opening
balance
Accrual
interest
Change of
fair value in
the period
Ending
balance
Cost
Accumulated
change of
fair value
Loss
impairment
accumulated
recognized in
other
comprehensi
Note
147
ve income
Important other creditors’ investment
RMB/CNY
Other 债权 Item
Ending balance Opening balance
Face value Coupon rate Actual rate
Maturity
date
Face value Coupon rate Actual rate
Maturity
date
Accrual of impairment provision
RMB/CNY
Bad debt provision
Phase I Phase II Phase III
Total
Expected credit
losses over next 12
months
Expected credit losses for
the entire duration (without
credit impairment occurred)
Expected credit losses for
the entire duration (with
credit impairment occurred)
Balance of Jan. 1 2019
in the period
—— —— —— ——
Change of book balance of loss provision with amount has major changes in the period
□ Applicable √Not applicable
Other explanation:
16. Long-term account receivable
(1) Long-term account receivable
RMB/CNY
Item
Ending balance Opening balance
Discount rate
interval Book balance
Bad debt
provision
Book value Book balance
Bad debt
provision
Book value
Impairment of bad debt provision
RMB/CNY
Bad debt provision
Phase I Phase II Phase III
Total
Expected credit
losses over next 12
months
Expected credit losses for
the entire duration (without
credit impairment occurred)
Expected credit losses for
the entire duration (with
credit impairment occurred)
Balance of Jan. 1 2019
in the period
—— —— —— ——
Change of book balance of loss provision with amount has major changes in the period
□ Applicable √Not applicable
148
(2) Long-term account receivable derecognition due to financial assets transfer
(3) Assets and liabilities resulted by long-term account receivable transfer and continues involvement
Other explanation
17. Long-term equity investment
RMB/CNY
The
invested
entity
Opening
balance
Current changes (+-)
Ending
balance
Ending
balance
of
impairme
nt
provision
Additiona
l
investmen
t
Capital
reduction
Investme
nt gains
recognize
d under
equity
Other
comprehe
nsive
income
adjustmen
t
Other
equity
change
Cash
dividend
or profit
announce
d to
issued
Accrual
of
impairme
nt
provision
Other
I. Joint venture
II. Associated enterprise
Shenzhen
Shenbao
(Xinmin)
Foods
Co.
Ltd*1
2870000
.00
2870000
.00
2870000
.00
Changzho
u
Shenbao
Chacang
E-busines
s Co.
ltd.*2
Shenzhen
Shenbao
(Liaoyuan
)
Industrial
Co.
Ltd*1
57628.53 57628.53 57628.53
Huizhou
Shenbao
Manan
Bio-techn
1050116
.57
1050116
.57
149
ology
Co. Ltd.
Shenzhen
Shichumi
ngmen
Restauran
t
Managem
ent Co.Ltd.*2
Guangzho
u
Shenbao
Mendao
Tea Co.Ltd.
3825725
.70
-135033.
88
3690691
.82
Zhuhai
Hengxing
Feed
Industrial
Co. Ltd.
2951077
1.11
666203.0
1
3017697
4.12
Shenzhen
Duoxi
Equity
Investme
nt Fund
Managem
ent Co.Ltd.
4014625
.45
-180833.
30
3833792
.15
Shenliang
Intelligent
Wulian
Equity
Investme
nt Fund
(Shenzhe
n)
Partnershi
p
Enterprise
(Limited)
2310566
2.49
3062765
.12
2616842
7.61
Shenzhen 9492765 9492765
150
Shenyuan
Data
Tech. Co.Ltd
.49 .49
Subtotal
7392729
5.34
1050116
.57
3413100
.95
7629027
9.72
2927628
.53
Total
7392729
5.34
1050116
.57
3413100
.95
7629027
9.72
2927628
.53
Other explanation
*1: these two companies have been established for a long time. At the current stage their business licenses have been revoked.
Impairment provision is made in full due to absence of settlement.
*2: the long-term equity investment for Changzhou Shenbao Chacang E-commence Co. Ltd and Shenzhen Shichumingmen
Restaurant Management Co. Ltd. which are measured by equity; the book balance counted as Zero for losses in the two above
mentioned enterprises
18. Other equity instrument investment
RMB/CNY
Item Ending balance Opening balance
Itemized the non-tradable equity instrument investment in the period
RMB/CNY
Item
Dividend income
recognized
Cumulative gains
Cumulative
losses
Retained earnings
transfer from
other
comprehensive
income
Causes of those
that designated
measured by fair
value and with its
variation
reckoned into
other
comprehensive
income
Cause of retained
earnings transfer
from other
comprehensive
income
Other explanation:
19. Other non-current financial assets
RMB/CNY
Item Ending balance Opening balance
Equity instrument investment 57500.00 57500.00
Total 57500.00 57500.00
Other explanation:
151
20. Investment real estate
(1) Measured at cost
√ Applicable □Not applicable
RMB/CNY
Item House and building Land use right Construction in progress Total
I. Original book value
1.Opening balance 567162333.74 567162333.74
2.Current amount
increased
23277994.41 23277994.41
(1) Outsourcing 506238.00 506238.00
(2) Inventory\fixed
assets\construction in
process transfer-in
(3) Increased by
combination
(4) Fixed assets
re-classify
22771756.41 22771756.41
3.Current amount
decreased
(1) Disposal
(2) Other transfer-out
4.Ending balance 590440328.15 590440328.15
II. Accumulated
depreciation and
accumulated
amortization
1.Opening balance 284540148.82 284540148.82
2.Current amount
increased
27726929.50 27726929.50
(1) Accrual or
amortization
15008484.90 15008484.90
(2) Fixed assets
re-classify
12718444.60 12718444.60
3.Current amount
152
decreased
(1) Disposal
(2) Other transfer-out
4.Ending balance 312267078.32 312267078.32
III. Impairment provision
1.Opening balance
2.Current amount
increased
(1) Accrual
3. Current amount
decreased
(1) Disposal
(2) Other transfer-out
4.Ending balance
IV. Book value
1.Ending book value 278173249.83 278173249.83
2. Opening book value 282622184.92 282622184.92
(2) Measure on fair value
□ Applicable √Not applicable
(3) Investment real estate without property certificate completed
RMB/CNY
Item Book value Reasons
Other explanation
21. Fixed assets
RMB/CNY
Item Ending balance Opening balance
Fixed assets 967835524.07 993136743.51
Total 967835524.07 993136743.51
153
(1) Fixed assets
RMB/CNY
Item House and buildings
Machinery
equipment
Transport equipment
Electronic and other
equipment
Total
I. Original book
value:
1.Opening balance 915002141.50 483988177.15 19100984.41 60021239.23 1478112542.29
2.Current amount
increased
7068163.27 1948332.70 388401.72 1189068.09 10593965.78
(1) Purchase 851658.64 1948332.70 388401.72 1189068.09 4377461.15
(2) Construction in
progress transfer-in
(3) Increased
by combination
(4)
Long-term expenses
to be apportioned
transfer-in and
deduct from fixed
assets disposal
6216504.63 6216504.63
3.Current amount
decreased
22972570.10 26000.00 250083.23 170679.38 23419332.71
(1) Disposal or
scrap
200813.69 26000.00 250083.23 170679.38 647576.30
(2) Investment real
estate re-classify
22771756.41 22771756.41
4.Ending balance 899097734.67 485910509.85 19239302.90 61039627.94 1465287175.36
II. Accumulated
depreciation
1.Opening balance 180969012.00 243434618.06 13913087.94 36532801.29 474849519.29
2.Current amount
increased
11138187.50 8714345.81 584438.71 5148706.96 25585678.98
(1) Accrual 11138187.50 8714345.81 584438.71 5148706.96 25585678.98
3.Current amount
decreased
12723481.61 13379.16 236714.88 136250.82 13109826.47
(1) Disposal or
scrap
5037.01 13379.16 236714.88 136250.82 391381.87
154
(2) Investment real
estate re-classify
12718444.60 12718444.60
4.Ending balance 179383717.89 252135584.71 14260811.77 41545257.43 487325371.80
III. Impairment
provision
1.Opening balance 1797706.49 8207030.23 93411.42 28131.35 10126279.49
2.Current amount
increased
(1) Accrual
3.Current amount
decreased
(1) Disposal or
scrap
4.Ending balance 1797706.49 8207030.23 93411.42 28131.35 10126279.49
IV. Book value
1.Ending book
value
717916310.29 225567894.91 4885079.71 19466239.16 967835524.07
2. Opening book
value
732235423.01 232346528.86 5094485.05 23460306.59 993136743.51
(2) Temporarily idle fixed assets
RMB/CNY
Item Original book value
Accumulated
depreciation
Impairment
provision
Book value Note
(3) Fixed assets by financing leased
RMB/CNY
Item Original book value
Accumulated
depreciation
Impairment provision Book value
(4) Fixed assets leased out by operation
RMB/CNY
Item Ending book value
155
(5) Fix assets without property certification held
RMB/CNY
Item Book value
Reasons for without the property
certification
House and buildings 322147486.94 Still under processing
House and buildings 106732318.67
Berth of wharf has right of use no need to
handle the certificate
House and buildings 15818640.81
The planning acceptance and construction
acceptance record can not be handle due to
the loss of planning and construction
historical data the approval process for
construction applications to relevant
government departments has been
restarted.House and buildings 16622783.16
Simple and temporary buildings etc
cannot handle the property right certificate
Total 461321229.58
Other explanation
(6) Fixed assets disposal
RMB/CNY
Item Ending balance Opening balance
Other explanation
22. Construction in progress
RMB/CNY
Item Ending balance Opening balance
Construction in progress 403629287.82 186586135.06
Total 403629287.82 186586135.06
(1) Construction in progress
RMB/CNY
Item
Ending balance Opening balance
Book balance
Impairment
provision
Book value Book balance
Impairment
provision
Book value
Shenbao Plaza 3842333.64 3842333.64 3842333.64 3842333.64
156
project
Dongguan grain
storage and wharf
matching project
121640933.02 121640933.02 91924086.19 91924086.19
Deep processing
of Dongguan
Industry and
Trading Food
76182755.87 76182755.87 39276418.03 39276418.03
CDE storage of
Dongguan Food
Industrial Park
and wharf mating
projects
193189866.13 193189866.13 43391511.05 43391511.05
Grain storage and
processing
7635165.71 7635165.71 6621284.40 6621284.40
Supporting
projects related to
grain supply
1133400.00 1133400.00
Workshop
transformation of
Flour Company
711487.37 711487.37
Other-Manageme
nt and control
system
informatization
construction
project of SZCG
408850.00 408850.00
Transformation -
Transformer
capacity
expansion project
of Pinghu
warehouse
597600.06 597600.06
Other 8489430.15 5648713.12 2840717.03 5564537.76 903189.74 4661348.02
Total 413120334.58 9491046.76 403629287.82 191331658.44 4745523.38 186586135.06
(2) Changes of major construction in progress
RMB/CNY
Item
Name
Budget
Opening
balance
Current
amount
Transfer-
in fixed
Other
decrease
Ending
balance
Proporti
on of
Progress
Accumul
ated
Includin
g:
Interest
capitaliz
Capital
resources
157
increased assets d in the
Period
project
investme
nt in
budget
capitaliz
ation of
interest
amount
of
capitaliz
ation of
interest
in Period
ation rate
in Period
Donggua
n grain
storage
and
wharf
matching
project
919240
86.19
297168
46.83
121640
933.02
Deep
processi
ng of
Donggua
n
Industry
and
Trading
Food
392764
18.03
369063
37.84
761827
55.87
CDE
storage
of
Donggua
n Food
Industria
l Park
and
wharf
mating
projects
433915
11.05
149798
355.08
193189
866.13
Grain
storage
and
processi
ng
662128
4.40
101388
1.31
763516
5.71
Total
181213
299.67
217435
421.06
398648
720.73
-- -- --
158
(3) The provision for impairment of construction in progress
RMB/CNY
Item Amount accrual in the period Reasons of accrual
Other explanation
(4) Engineering material
RMB/CNY
Item
Ending balance Opening balance
Book balance
Impairment
provision
Book value Book balance
Impairment
provision
Book value
Other explanation:
23. Productive biological asset
(1) Measured by cost
√ Applicable □Not applicable
RMB/CNY
Item Plant Livestock Forestry Fisheries Total
Tea tree
I. Original book
value
1.Opening balance 436156.00 436156.00
2.Current amount
increased
(1)Outsourcing
(2)self-cultivate
3.Current amount
decreased
(1)Disposal
(2)Other
4.Ending balance
II. Accumulated
depreciation
159
1.Opening balance
2.Current amount
increased
(1)Accrual
3.Current amount
decreased
(1)Disposal
(2)Other
4.Ending balance 436156.00 436156.00
III. Impairment
provision
1.Opening balance 29077.08 29077.08
2.Current amount
increased
4846.18 4846.18
(1)Accrual 4846.18 4846.18
3.Current amount
decreased
(1)Disposal
(2)Other
4.Ending balance 33923.26 33923.26
IV. Book value
1.Ending book
value
402232.74 402232.74
2. Opening book
value
407078.92 407078.92
(2) Measured by fair value
□ Applicable √Not applicable
24. Oil and gas asset
□ Applicable √Not applicable
160
25. Right-of-use asset
RMB/CNY
Item Total
Other explanation:
26. Intangible assets
(1) Intangible assets
RMB/CNY
Item
Land use
right
Patent
Non-patent
technology
Forest tree
use right
Trademark
use right
Shop
managemen
t right
Software
use right
Other Total
I. Original
book value
1.Opening
balance
594651154
.35
46265918.
89
22871704.
98
277927.77
3610487.3
7
10028021.
72
5054036.1
682759251
.20
2.Current
amount
increased
25676017.
14
954566.08
26630583.
22
(1)
Purchase
25676017.
14
954566.08
26630583.
22
(2)
internal
R&D
(3)
Increased
by
combination
(4) Group
handover
3.Current
amount
decreased
2977317.1
2
106454.45
3083771.5
7
(1)
Disposal
2977317.1
2
106454.45
3083771.5
7
161
4.Ending
balance
620327171
.49
43288601.
77
22871704.
98
171473.32
3610487.3
7
10028021.
72
6008602.2
0
706306062
.85
II.
Accumulate
d
depreciation
1.Opening
balance
69506679.
20
24341841.
17
4627352.3
8
165797.48
1197835.8
6
3544168.5
2
2656842.3
5
106040516
.96
2.Current
amount
increased
7707105.7
2
566196.28 430340.55 3347.75 54168.03 32200.02
1285499.8
10078858.
18
(1)
Accrual
7707105.7
2
566196.28 430340.55 3347.75 54168.03 32200.02
1285499.8
3
10078858.
18
(2) Group
handover
3.Current
amount
decreased
949832.38 68737.71
1018570.0
9
(1)
Disposal
949832.38 68737.71
1018570.0
9
4.Ending
balance
77213784.
92
23958205.
07
5057692.9
3
100407.52
1252003.8
9
3576368.5
3942342.1
8
115100805
.05
III.Impairment
provision
1.Opening
balance
5553283.5
4
37716.74
1130341.8
8
6721342.1
6
2.Current
amount
increased
162
(1)
Accrual
3.Current
amount
decreased
2021691.1
3
37716.74
2059407.8
7
(1)
Disposal
2021691.1
3
37716.74
2059407.8
7
4.Ending
balance
3531592.4
1
1130341.8
8
4661934.2
9
IV. Book
value
1.Ending
book value
543113386
.57
15798804.
29
17814012.
05
71065.80
2358483.4
8
5321311.3
0
2066260.0
2
586543323
.51
2.
Opening
book value
525144475
.15
16370794.
18
18244352.
60
74413.55
2412651.5
1
5353511.3
2
2397193.7
7
569997392
.08
Ratio of the intangible assets from internal R&D in balance of intangible assets at period-end was 2.69%.
(2) Land use rights without certificate of ownership
RMB/CNY
Item Book value
Reasons for without the property
certification
Land use right 69525279.34 Still under processing
Land use right 7849990.00
Collective land cannot handle the
certificate of ownership
Total 77375269.34
Other explanation:
27. Expense on Research and Development
RMB/CNY
Item
Opening
balance
Current amount increased Current amount decreased
Ending
balance
163
Other explanation
28. Goodwill
(1) Goodwill Original book value
RMB/CNY
The invested
entity or matters
forming goodwill
Opening balance Current increased Current decreased Ending balance
Pu’er Tea Trading
Center
673940.32 673940.32
Total 673940.32 673940.32
(2) Goodwill impairment provision
RMB/CNY
The invested
entity or matters
forming goodwill
Opening balance Current increased Current decreased Ending balance
Pu’er Tea Trading
Center
673940.32 673940.32
Total 673940.32 673940.32
Relevant information about the assets group or portfolio goodwill included
Hangzhou Ju Fang Yong a subsidiary of the Company funded and purchased 15.00% stake of Yunnan Pu’er Tea Trading Center
held by Yunnan Heng Feng Xiang Investment Co. Ltd. in May 2016. After the completion of the purchase the Company got
command of Yunnan Pu’er Tea Trading Center. The balance between the combined cost and the fair value of net assets on the
combining date formed goodwill of RMB 673940.32.Instructions for goodwill impairments test process and key parameters (such as the forecast period growth rate stable period growth
rate profit rate discount rate and forecast period when estimating the present value of the future cash flow) and the method of
confirming the impairment loss of goodwill:
Impact of goodwill impairment test
Other explanation
29. Long-term expenses to be apportioned
RMB/CNY
Item Opening balance
Current amount
increased
Current amortization Other decreased Ending balance
Decoration fee 4550750.21 639455.81 1077318.99 4112887.03
164
Improve expenditure
for investment real
estate
8706105.90 386402.36 1718294.87 7374213.39
Improve expenditure
for fix assets
2385091.34 386402.36 1077318.99 1694174.71
Affiliated project of
resident area in
Wuyuan Ju Fang
Yong
36374.47 36374.47
Other 6121577.88 4509660.72 7069725.36 3561513.24
Total 21799899.80 5921921.25 10979032.68 16742788.37
Other explanation
30. Deferred income tax asset /Deferred income tax liabilities
(1) Deferred income tax assets without offset
RMB/CNY
Item
Ending balance Opening balance
Deductible temporary
differences
Deferred income tax
asset
Deductible temporary
differences
Deferred income tax
asset
Impairment provision for
assets
200374677.59 49789641.65 200997551.38 49759336.40
Unrealized profits in
internal transactions
1348710.60 337177.65 1348710.60 337177.65
Deferred income 115540.85 28885.21 312307.72 78076.93
Total 201838929.04 50155704.51 202658569.70 50174590.98
(2) Deferred income tax liability without offset
RMB/CNY
Item
Ending balance Opening balance
Taxable temporary
differences
Deferred income tax
liabilities
Taxable temporary
differences
Deferred income tax
liabilities
Asset evaluation
increment of enterprise
combine under different
control
52450293.02 13112573.25 51909877.24 12977469.31
Change of fair value for
the financial assets
18060.77 43861.84 10965.46
165
available for sale
Other 129230.76 32307.69
Total 52579523.78 13162941.71 51953739.08 12988434.77
(3) Deferred income tax assets and deferred income tax liabilities listed after off-set
RMB/CNY
Item
Trade-off between the
deferred income tax
assets and liabilities
Ending balance of
deferred income tax
assets or liabilities after
off-set
Trade-off between the
deferred income tax
assets and liabilities at
period-begin
Opening balance of
deferred income tax
assets or liabilities after
off-set
Deferred income tax
asset
50155704.51 50174590.98
Deferred income tax
liabilities
13162941.71 12988434.77
(4) Details of uncertain deferred income tax assets
RMB/CNY
Item Ending balance Opening balance
Deductible loss 114488957.68 112864728.90
Impairment provision for assets
163267590.71
172615170.87
Deferred income 98606151.11 10097899.20
Total
376362699.50
295577798.97
(5) Deductible losses of un-recognized deferred income tax assets expired on the followed year
RMB/CNY
Year Ending amount Opening amount Note
Other explanation:
31. Other non-current asset
Whether implemented the new revenue standards
□Yes √No
RMB/CNY
Item Ending balance Opening balance
Prepaid for equipment 854782.25 866378.12
166
Prepaid for engineering 1069771.60
Total 854782.25 1936149.72
Other explanation:
32. Short-term loans
(1) Category
RMB/CNY
Item Ending balance Opening balance
Secured loans 30000000.00
Guarantee loan 30000000.00
Loan in credit 30590000.00 31600000.00
Total 30590000.00 91600000.00
Explanation on category of short-term loans
Dongguan Logistics a subsidiary of the Company signed the “Liquidity Loan Contract” No. 44191000-2018 (Dongben) Zi No. 0124
with Agricultural Development Bank of China Dongguan Branch and obtained a loan of RMB 31.60 million by credit loan on 25
December 2018 the life of the loan is 11 months which expires on October 31 2019 the lending rate is 4.35% and the interest
accrual is segmented and shall be adjusted with the adjustment of the benchmark interest rate for loan of the People’s Bank of China.
On 25 April 2019 return the principal of RMB 1.01 million in advance as of 30th June 2019 balance of the above loan contract was
RMB 30.59 million.
(2) Overdue short-term loans without payment
RMB 0 short-term loans over due without paid at period-end including follow major amount:
RMB/CNY
Borrower Ending balance Loan rate Overdue time Overdue interest
Other explanation:
33. Tradable financial liability
RMB/CNY
Item Ending balance Opening balance
Including:
Including:
Other explanation:
34. Derivative financial liability
RMB/CNY
167
Item Ending balance Opening balance
Other explanation:
35. Note payable
RMB/CNY
Category Ending balance Opening balance
Notes expired at year-end without paid was Yuan.
36. Account payable
(1) Account payable
RMB/CNY
Item Ending balance Opening balance
Trade accounts payable 166948547.76 438618768.51
Account payable for engineering 2740687.88 31922123.90
Other 1512306.39 2197391.39
Total 171201542.03 472738283.80
(2) Major accounts payable with age over one year
RMB/CNY
Item Ending balance Reasons of outstanding or carry-over
Other explanation:
37. Accounts received in advance
Whether implemented the new revenue standards
□Yes √No
(1) Accounts received in advance
RMB/CNY
Item Ending balance Opening balance
Account for goods received in advance 136680171.97 204866040.96
Other 335.00 562553.20
Total 136680506.97 205428594.16
168
(2) Important account received in advance with account age over one year
RMB/CNY
Item Ending balance Reasons of outstanding or carry-over
(3)Projects that settle without completed from construction contract at period-end
RMB/CNY
Item Amount
Other explanation:
38. Contract liability
RMB/CNY
Item Ending balance Opening balance
Amount and reasons for important changes of book value in the period
RMB/CNY
Item Amount changed Reasons of changes
39. Wage payable
(1) Wage payable
RMB/CNY
Item Opening balance Current increased Current decreased Ending balance
I. Short-term
compensation
121382348.52 110755883.84 126712977.10 105425255.26
II. After-service
welfare-defined
contribution plans
10264159.59 7137532.42 5709228.04 11692463.97
III. Dismissed welfare 4062915.41 1775288.50 4132593.81 1705610.10
Total 135709423.52 119668704.76 136554798.95 118823329.33
(2) Short-term compensation
RMB/CNY
Item Opening balance Current increased Current decreased Ending balance
1. Wage bonus
allowance and subsidy
113607669.85 95513877.15 112379987.79 96741559.21
2. Employees’ welfare 4322541.36 3488228.87 834312.49
169
3. Social insurance
charges
99598.81 3179002.40 3253503.72 25097.49
Including:medical
insurance premium
92813.10 2908544.07 2985246.36 16110.81
Industrial injury
insurance
premiums
304.92 98717.46 98733.53 288.85
Maternity
insurance
premiums
6480.79 171740.87 169523.83 8697.83
4. Housing public reserve 4268648.06 4207418.56 61229.50
5. Trade union fee and
education fee
7675079.86 3471814.87 3383838.16 7763056.57
6. Short paid absence
Total 121382348.52 110755883.84 126712977.10 105425255.26
(3) Defined contribution plans
RMB/CNY
Item Opening balance Current increased Current decreased Ending balance
1. Basic endowment
insurance premiums
236975.62 5425569.74 5426694.64 235850.72
2. Unemployment
insurance premiums
4569.75 85387.47 85427.65 4529.57
3. Enterprise annuity 10022614.22 1626575.21 197105.75 11452083.68
Total 10264159.59 7137532.42 5709228.04 11692463.97
Other explanation:
40. Taxes payable
RMB/CNY
Item Ending balance Opening balance
VAT 7962236.13 9493004.93
Enterprise income tax 9895834.07 9219053.50
Personal income tax 4381282.54 1927699.20
Urban maintenance and construction tax 2010802.27 640819.28
House property tax 3618554.77 1725020.41
Use tax of land 1906234.62 574505.73
Stamp tax 139142.66 246056.29
Educational surtax 347625.53 483228.46
170
Other 5893.24 660330.78
Total 30267605.83 24969718.58
Other explanation:
41. Other account payable
RMB/CNY
Item Ending balance Opening balance
Interest payable 1020795.27
Dividend payable 2909182.74 2909182.74
Other account payable 301049727.50 277780365.55
Total 304979705.51 280689548.29
(1) Interest payable
RMB/CNY
Item Ending balance Opening balance
Long-term loans interest for installment 1020795.27
Total 1020795.27
Major overdue interest:
RMB/CNY
Borrower Overdue amount Overdue causes
Other explanation:
(2) Dividend payable
RMB/CNY
Item Ending balance Opening balance
Common stock dividends 2909182.74 2909182.74
Total 2909182.74 2909182.74
Other explanation including important dividend payable over one year without payment disclose reasons for un-paid:
(3) Other account payable
1) By nature
RMB/CNY
Item Ending balance Opening balance
Engineering quality retention money and 34476867.04 3191037.22
171
fund of tail
Deposit and margin 160981227.12 151049170.31
Intercourse funds and other 99081804.21 100749160.89
Drawing expenses in advance 6509829.13 22790997.13
Total 301049727.50 277780365.55
2)Significant other account payable with over one year age
RMB/CNY
Item Ending balance Reasons of outstanding or carry-over
Other explanation
42. Liability held for sale
RMB/CNY
Item Ending balance Opening balance
Other explanation:
43. Non-current liabilities due within one year
RMB/CNY
Item Ending balance Opening balance
Long-term loans due within one year 60027362.43 55090793.79
Total 60027362.43 55090793.79
Other explanation:
Found more in Long-term loans
44. Other current liabilities
Whether implemented the new revenue standards
□Yes √No
RMB/CNY
Item Ending balance Opening balance
Subsidies for grain reserve services 219151968.63 219151968.63
Total 219151968.63 219151968.63
Change of short-term bonds payable:
RMB/CNY
Bonds
Face
value
Issuance
date
Bonds
term
Amount
issued
Opening
balance
Issued in
the period
Accrual
interest
by face
Premium
and
discount
Paid in
the period
Ending
balance
172
value amortizati
on
Other explanation:
45. Long-term loans
(1) Category
RMB/CNY
Item Ending balance Opening balance
Mortgage loan 701297326.68 462449380.03
Guarantee loan 136114135.95 109329205.42
Less: Long-term loans due within one year -60027362.43 -55090793.79
Total 777384100.20 516687791.66
Explanation on category of long-term loans:
(i) Guarantee loan
(1) Dongguan Logistics a subsidiary of the Company signed a bank credit contract with credit number of
CN11002181808-160714-SCDGTML2 with HSBC. HSBC has provided a loan credit not more than RMB 200 million to Dongguan
Logistics. The applicable interest rate for each loan at each interest period is 90% of the loan benchmark interest rate of central bank
applicable on the fixed interest date of the interest period the borrowing date is from December 27 2016 to December 27 2021. As
of 30th June 2019 Dongguan Logistics obtained the principal balance of the loan of HSBC of RMB 99794700 of which the
non-current liabilities due within one year was RMB 20340300. SZCG and Dongguan Fruit Vegetable Non-staple Food Trading
Market Co. Ltd. provided the maximum guarantee amount for the loan.
(2) Dongguan Industry and Trade a subsidiary of the Company signed a bank credit contract with credit number of
CN11002181808-190305-SCOM-TML with HSBC HSBC provided a loan credit not more than RMB233 million to Dongguan
Industry and Trade. The applicable interest rate for each loan at each interest period is from 5% to 3% of the loan benchmark interest
rate of central bank applicable on the fixed interest date of the interest period the borrowing date was from May 9 2019 to May 8
2024. As of June 30 2019 Dongguan Industry and Trade had obtained the principal balance of the loan of RMB 36319500 from
HSBC. SZCG and Dongguan Fruit Vegetable Non-staple Food Trading Market Co. Ltd. provided the maximum guarantee amount
for the loan.(ii) Mortgage loan
(1) Dongguan Food Industry Park a subsidiary of the Company signed the loan contract of “Yue DG 2017 NGDZ No. 006” with
Bank of Communications Guangdong Branch the loan amount is RMB 768 million and the loan term is from September 22 2017 to
August 29 2032. The loan under this contract is only used for the construction of the warehousing and logistics distribution center
project of Dongguan Food Industry Park. The principal of the current loan was RMB 49.8 million RMB 3783400 RMB 30 million
RMB 200 million and RMB 200 million the loan interest rate of last two RMB 200 million were calculated by the benchmark
interest rate for loan of the People’s Bank of China on the loan entry date which was 4.90%; the other three loans were calculated by
the benchmark interest rate of the People’s Bank of China on the loan entry date after rising by 15% which is 5.635%. As of 30th
June 2019 the total loan balance under the above loan contract was RMB 483583400. Dongguan Food Industry Park mortgaged its
two pieces of lands (DFGY (2009) DT No. 190) and (DFGY (2012) DT No. 152) for the borrowing. At the same time the
173
Company’s subsidiaries SZCG and Dongguan Fruit Vegetable Non-staple Food Trading Market Co. Ltd. provide joint liability
guarantee.
(2) Dongguan Logistics a subsidiary of the Company signed a loan contract with contract number of 44031000-2015 (Shen) Zi No.
0023 with China Agricultural Development Bank with a total loan amount of RMB 273 million and an annual interest rate of 5.4%
the interest rate is adjusted year by year from the actual withdrawal date based on the adjustment of benchmark interest rate for loan
of the People's Bank of China and the loan period is from July 31 2015 to July 12 2023. As of 30th June 2019 the balance under the
above contract was RMB 212813900 of which the non-current liabilities due within one year were RMB 39687000. Shenzhen
Cereals Group has provided guarantee for the loan and taken Dongguan Logistics’ land “DFGY(2014) DT No. 6” at No. 32 Jianshe
Road Masan Village Machong Town Dongguan City and the above-ground buildings and structures to be built in the future as
mortgages of which the land assessment value is RMB 51.21 million.
(3) Dongguan Logistics a subsidiary of the Company signed a loan contract with contract number of 44191000-2018 (Dongben) Zi
No. 0100 with China Agricultural Development Bank with a total loan amount of RMB 430 million and an annual interest rate of
4.9% the interest rate is adjusted year by year from the actual withdrawal date based on the adjustment of benchmark interest rate for
loan of the People's Bank of China and the loan period was from January 25 2019 to January 24 2031. As of June 30 2019 the
balance under the above contract was RMB 4.9 million. The Company’s subsidiaries SZCG and Dongguan Fruit Vegetable
Non-staple Food Trading Market Co. Ltd. and Dongguan Houjie Xunda Industrial Co. Ltd. provided joint liability guarantee for the
borrowing and took Dongguan Logistics’ land “Yue (2016) DGSBDCQ No. 0028527” as a mortgage of which the land assessment
value is RMB 52290800.Other explanation including interest rate range:
46. Bonds payable
(1) Bonds payable
RMB/CNY
Item Ending balance Opening balance
(2) Changes of bonds payable (not including the other financial instrument of preferred stock and
perpetual capital securities that classify as financial liability)
RMB/CNY
(3) Convertible conditions and time for shares transfer for the convertible bonds
(4) Other financial instruments classify as financial liability
Basic information of the outstanding preferred stock and perpetual capital securities at period-end
Changes of outstanding preferred stock and perpetual capital securities at period-end
RMB/CNY
174
Outstandin
g financial
instrument
Period-beginning Current increased Current decreased Period-end
Amount Book value Amount Book value Amount Book value Amount Book value
Basis for financial liability classification for other financial instrument
Other explanation
47. Lease liability
RMB/CNY
Item Ending balance Opening balance
Other explanation
48. Long-term account payable
RMB/CNY
Item Ending balance Opening balance
Special account payable 15724141.66 15690202.08
Total 15724141.66 15690202.08
(1) By nature
RMB/CNY
Item Ending balance Opening balance
Other explanation:
(2) Special account payable
RMB/CNY
Item Opening balance Current increased Current decreased Ending balance Causes
Depreciation fund
for grain deposits
15471085.99 39978.58 15511064.57
The finance
allocated to the
company as a
government
investment in
depreciation special
funds of reserve
grain depot and
interest.Special funds for
public welfare
scientific research in
219116.09 6039.00 213077.09
175
grain industry
Total 15690202.08 39978.58 6039.00 15724141.66 --
Other explanation:
49. Long-term wage payable
(1) Long-term wage payable
RMB/CNY
Item Ending balance Opening balance
(2) Changes of defined benefit plans
Present value of the defined benefit plans:
RMB/CNY
Item Current Period Last Period
Scheme assets:
RMB/CNY
Item Current Period Last Period
Net liability (assets) of the defined benefit plans
RMB/CNY
Item Current Period Last Period
Content of defined benefit plans and relevant risks impact on future cash flow of the Company as well as times and uncertainty:
Major actuarial assumption and sensitivity analysis:
Other explanation:
50. Accrual liabilities
Whether implemented the new revenue standards
□Yes √No
RMB/CNY
Item Ending balance Opening balance Causes
Other explanation including relevant important assumptions and estimation:
51. Deferred income
RMB/CNY
Item Opening balance Current increased Current decreased Ending balance Causes
Government grants 100608203.01 1386.60 1887897.65 98721691.96
See table below for
details
176
Total 100608203.01 1386.60 1887897.65 98721691.96 --
Item with government grants involved:
RMB/CNY
Liability
Opening
balance
New grants
in the Period
Amount
reckoned in
non-operatio
n revenue
Amount
reckoned in
other income
Cost
reduction in
the period
Other
changes
Ending
balance
Assets-relate
d/income
related
(1) Base of
further
processing
for tea and
nature plants
1100000.00 520462.29 579537.71
Assets-relate
d
(2) Enterprise
technology
center is a
municipal
R&D center.
Subsidies for
industrial
technological
advancement
1987301.17 1987301.17
Assets-relate
d
(3) Project
grants for
years for
agricultural
district Xihu
Zone
312307.72 312307.72
Assets-relate
d
(4)Key
technology
research and
development
for the
preparation
of
high-quality
aroma
extracts
based on the
use of tea
aroma
precursors
241323.58 2490.27 238833.31
Income-relate
d
(5)Key 243233.62 104329.55 138904.07 Assets-relate
177
technology
research and
development
for the
preparation
of
high-quality
aroma
extracts
based on the
use of tea
aroma
precursors
d
(6) Finance
Discount
337222.22 337222.22
Assets-relate
d
(7)
Industrializati
on of instant
tea powder
2084136.67 2084136.67
Assets-relate
d
(8) Grant for
key
technology
research and
industrializati
on of
instant tea
powder
153011.21 153011.21
Assets-relate
d
(9) Special
fund for the
development
of strategic
emerging
industries in
Shenzhen(pla
nt deep
processing
engineering)
(Shen
Development
& Reform
No.
20131601)
3538892.95 3538892.95
Assets-relate
d
(10)Construct 500000.00 62500.00 437500.00 Assets-relate
178
ion amount
for 50 tons
for clearly
processing
for Mingyou
tea
d
(11) Subsidy
for tea
seeding of
New Tea
Garden in
Wangkou
46129.96 1386.60 1941.24 45575.32
Assets-relate
d
(12) Subsidy
for supply
system
construction
of
agricultural
products
750000.00 750000.00
Assets-relate
d
(13) Grain
storage
project of
Dongguan
Shenliang
Logistics Co.Ltd. - Storage
A
8242417.83 131128.56 8111289.27
Assets-relate
d
(14) Phase II
of grain
storage
project of
Dongguan
Shenliang
Logistics Co.Ltd.- Storage
B
32968699.5
2
515650.26
32453049.2
6
Assets-relate
d
(15) Grain
oil and food
headquarters
and
innovative
public service
platform of
18000000.0
0
18000000.0
0
Assets-relate
d
179
Dongguan
Shenliang
Logistics Co.Ltd.
(16)Special
funds for
intelligent
upgrading
and
transformatio
n of grain
warehouse
for the 2017“Grain SafetyProject”
5100000.00 5100000.00
Assets-relate
d
(17)
Construction
of 450000
ton silos and
60000 ton
film silos
-CDE
warehouse.Gas storage
bin
17491764.7
1
17491764.7
1
Assets-relate
d
(18) Special
fund for
agricultural
development
in Shenzhen -
subsidy for
agricultural
product
quality and
safety testing
capacity-buil
ding project
Assets-relate
d
(19) Special
fund for
agricultural
development
of 2016-
agricultural
492000.00 492000.00
Assets-relate
d
180
product
safety testing
project-
capacity
building of
the third
party
inspection
institution
expansion
evaluation
(20)Agricultu
ral product
safety testing
project of the
special fund
for
agricultural
development
of 2016 -
Central
investment
fund
1026000.00 1026000.00
Assets-relate
d
(21)
Construction
of O2O
community
sales service
system for
high quality
grain and oil
based on
B2C
E-commerce
platform
1789411.20 19288.02 1770123.18
Assets-relate
d
(22)
Industrializati
on of Doximi
E-commerce
platform
2813684.01 430107.44 2383576.57
Assets-relate
d
(23)
Commercial
circulation
524000.00 524000.00
Assets-relate
d
181
development
project
funding for
year of 2017
(24)
Intelligent
management
of grain
depot based
on mobile
internet
866666.64 100000.02 766666.62
Assets-relate
d
Total
100608203.
01
1386.60 1887897.65
98721691.9
6
Other explanation:
52. Other non-current liabilities
Whether implemented the new revenue standards
□Yes √No
RMB/CNY
Item Ending balance Opening balance
Other explanation:
53. Share capital
In RMB/CNY
Opening
balance
Increased (decreased) in this year +-
Ending balance
New shares
issued
Bonus shares
Shares
converted from
public reserve
Other Subtotal
Total shares
1152535254.
00
1152535254.
00
Other explanation:
54. Other equity instrument
(1)Basic information of the outstanding preferred stock and perpetual capital securities at period-end
(2) Changes of outstanding preferred stock and perpetual capital securities at period-end
RMB/CNY
182
Outstandin
g financial
instrument
Period-beginning Current increased Current decreased Period-end
Amount Book value Amount Book value Amount Book value Amount Book value
Changes of other equity instrument change reasons and relevant accounting treatment basis:
Other explanation:
55. Capital public reserve
RMB/CNY
Item Opening balance Current increased Current decreased Ending balance
Capital premium (Share
capital premium)
1413996347.50 1413996347.50
Other capital reserve 8896381.86 8896381.86
Total 1422892729.36 1422892729.36
Other instructions including changes in the current period reasons for the change:
56.Treasury stock
RMB/CNY
Item Opening balance Current increased Current decreased Ending balance
Other explanation including changes and reasons for changes:
57. Other comprehensive income
RMB/CNY
Item
Opening
balance
Current Period
Ending
balance
Account
before
income tax
in the
period
Less: written
in other
comprehensi
ve income in
previous
period and
carried
forward to
gains and
losses in
current
period
Less:
written in
other
comprehe
nsive
income in
previous
period and
carried
forward to
retained
earnings in
current
period
Less : income
tax expense
Belong to
parent
company
after tax
Belong to
minority
shareholders
after tax
Other explanation including the active part of the hedging gains/losses of cash flow transfer to initial reorganization adjustment for
183
the arbitraged items:
58. Reasonable reserve
RMB/CNY
Item Opening balance Current increased Current decreased Ending balance
Production safety fee 154.21 460394.34 398138.99 62409.56
Total 154.21 460394.34 398138.99 62409.56
Other explanation including changes and reasons for changes:
59. Surplus public reserve
RMB/CNY
Item Opening balance Current increased Current decreased Ending balance
Statutory surplus
reserves
327140910.28 327140910.28
Total 327140910.28 327140910.28
Other explanation including changes and reasons for changes:
60. Retained profit
RMB/CNY
Item Current period Last period
Retained profit at the end of the previous year
before adjustment
1269933487.26 961602454.82
Total retained profit at the beginning of the
previous year before adjustment
1269933487.26
961602454.82
Add: net profit attributable to shareholder of
parent company
203168850.61 308331032.44
Common stock dividends payable 115253525.40
Retained profit at period-end 1357848812.47
1269933487.26
Details about adjusting the retained profits at the beginning of the period:
1) The retroactive adjustments to Accounting Standards for Business Enterprises and its relevant new regulations affect the retained
profits at the beginning of the period amounting to 0 Yuan.
2) The changes in accounting policies affect the retained profits at the beginning of the period amounting to 0 Yuan.
3) The major accounting error correction affects the retained profits at the beginning of the period amounting to 0 Yuan
4) Merge scope changes caused by the same control affect the retained profits at the beginning of the period amounting to 0 Yuan.
5) Other adjustments affect the retained profits at the beginning of the period amounting to 0 Yuan
184
61. Operating income and operating cost
RMB/CNY
Item
Current Period Last Period
Income Cost Income Cost
Main business 4778550071.95 4258702014.11 4430802356.92 3960514399.97
Other business 3617660.74 3399756.51 3886289.90 2238763.29
Total 4782167732.69 4262101770.62 4434688646.82 3962753163.26
Whether implemented the new revenue standards
□Yes √No
Other explanation
62. Tax and surcharges
RMB/CNY
Item Current Period Last Period
Urban maintenance and construction tax 850546.63 760276.77
Educational surtax 647628.82 531572.95
House property tax 3902342.55 4101505.15
Use tax of land 856035.80 1734334.20
Stamp tax 339910.55 490071.74
Other 9049.85 44157.29
Total 6605514.20 7661918.10
Other explanation:
63. Sales expenses
RMB/CNY
Item Current Period Last Period
Labor and social security benefits 28921374.58 28566852.50
Rental 4572089.52 5202348.44
Utilities and office expenses 2983459.64 2256674.49
After-sale services 3239606.10 2278428.97
Logistics transportation fee 55354469.30 64795623.08
Travel expenses 1356310.96 1393737.48
Equivalent loss for low value perishable
goods
1481592.76 73335.37
185
Depreciation and amortization of
long-term assets
5855616.32 6325647.19
Business hospitality 485263.49 891031.17
Advertisement charge 406507.02 340028.56
Sales commission 893.65 33525.44
Property insurance premium 462098.96 636293.07
Other 7434460.44 7658578.54
Total 112553742.74 120452104.30
Other explanation:
64. Administration expenses
RMB/CNY
Item Current Period Last Period
Labor and social security benefits 64112522.69 57480497.61
Communication fee 698972.98 469589.19
Vehicle usage fee 678600.30 629920.42
Low-value consumables 141751.26 148541.67
Repair cost 264513.27 154127.60
Depreciation and amortization of
long-term assets
11830728.97 16385472.44
Travel expenses 1286620.67 1585963.64
Business hospitality 1227426.99 1807036.55
Office expenses 7666398.75 3974305.97
Rental 750998.75 747002.77
Intermediary fees 3750693.95 7635130.54
Other 8988719.41 5306440.50
Total 101397947.99 96324028.90
Other explanation:
65. R&D expenses
RMB/CNY
Item Current Period Last Period
Labor and social security benefits 2786779.24 2090867.55
Depreciation cost 619854.40 443606.10
Office expenses 280219.64 237386.41
186
Travel expenses 180071.96 39290.22
Logistics consumption 199042.35 8028.00
Intermediary fees 43200.00
Maintenance and inspection fee 35889.40 38966.32
Material costs 20436.66
Other 45981.26 118917.94
Total 4211474.91 2977062.54
Other explanation:
66. Financial expenses
RMB/CNY
Item Current Period Last Period
Interest expenses 10087784.34 4313048.72
Less: Interest income 2185171.96 3899478.59
Exchange loss 303008.96 -2999702.59
Bank commission charge and others
314110.51
412826.19
Total 8519731.85 -2173306.27
Other explanation:
67. Other income
RMB/CNY
Sources Current Period Last Period
R&D subsidy for 2018 from Shenzhen
Science & Technology Innovation
Committee
216000.00
Other subsidy 1023166.45
Received the construction subsidy for top
talents project of Guangdong Provincial
Grain & Material Reserve Bureau
30000.00
Grain talents program subsidy 20269.70
Amortization of deferred income 1402816.24
Amortization of deferred income 485081.41
Received the loan discount for leading
agricultural enterprises
388300.00
187
Service charges are refund by Taxation
Bureau
126043.99
Received the intermediary fee subsidy for
mergers and acquisition of the Nanshan
Economic promotion Bureau
738700.00
Received the employee social insurance
subsidy (1-9) of Wuyuan County Finance
Bureau for 2018
470078.93
Received the patent award for 2018 from
Shangrao Intellectual Property Bureau
50000.00
Received the guiding funds for industrial
development for 2018 from Industry and
Information Technology Bureau (Fiscal
Appropriation)
170697.00
Received the high-tech enterprise award
for 2018 from Industry and Information
Technology Bureau (Fiscal Appropriation)
200000.00
Received the provincial R&D center fund
for 2018 from Industry and Information
Technology Bureau (Fiscal Appropriation)
50000.00
Amount of the new project of 50 tons
clean mingou tea processing for first half
of 2019
62500.00
Government grants 826872.02
Special supporting funds for the
development of independent innovative
industry in Nanshan District (funding for
modern agricultural development)
451582.44
Doximi's construction of O2O community
sales service system for high quality grain
and oil based on B2C E-commerce
platform
19288.02
Funds for construction of the agricultural
products supply system
100000.00
Grain modern logistics for year of 2014 128150.93
Special funds for the development of
E-commerce development service industry
1000000.00
Industrial development funds in Futian
District the 2nd batch of supporting
enterprise for year of 2013
1100000.00
188
Investment subsidy for the infrastructure
works of Dongguan International Food
Industrial Park Development Co. Ltd from
Guangdong Development & Reform
Commission and Guangdong provincial
Food Bureau
69411.76
Grain storage facilities (expansion of
150000 tons of warehouse capacity)
541158.45
Subsidy for internet of things project
supervised by the State for Grain Storage
and Transportation
54500.00
Independent innovation support funds of
SASAC based on mobile internet project
33333.34
Total 5433653.72 4324296.96
68. Investment income
RMB/CNY
Item Current Period Last Period
Long-term equity investment income
measured by equity
3413100.95 626055.86
Investment income from disposal of long-term
equity investment
127368.82
Income from financial products 3627466.27 717351.60
Total 7167936.04 1343407.46
Other explanation:
69. Net exposure hedge gains
RMB/CNY
Item Current Period Last Period
Other explanation:
70. Income of fair value changes
RMB/CNY
Sources Current Period Last Period
Tradable financial assets 28381.21 -425718.15
Total 28381.21 -425718.15
Other explanation:
189
71. Credit impairment loss
RMB/CNY
Item Current Period Last Period
Loss of bad debt of other account
receivable
5143559.77
Total 5143559.77
Other explanation:
72. Assets impairment loss
Whether implemented the new revenue standards
□Yes √No
RMB/CNY
Item Current Period Last Period
I. Bad debt losses 2063558.29 116491.30
II. Provision for falling price of inventory -71294981.71 -32678876.93
Total -69231423.42 -32562385.63
Other explanation:
73. Income from assets disposal
RMB/CNY
Sources Current Period Last Period
Gains or losses from fixed assets disposal -4184.59 -210840.01
74. Non-operating income
RMB/CNY
Item Current Period Last Period
Amount included in the current
non-recurring profit and loss
Government grants 3000.00 3000.00
Other 359252.46 980860.83 359252.46
Total 362252.46 980860.83 362252.46
Government grants reckoned into current gains/losses:
RMB/CNY
Grants
Issuing
subject
Issuing
cause
Property
type
Whether
the impact
of
Whether
special
subsidies
Amount of
this period
Amount of
last period
Assets
related/Inc
ome related
190
subsidies
on the
current
profit and
loss
Other explanation:
75. Non-operating expenditure
RMB/CNY
Item Current Period Last Period
Amount included in the current
non-recurring profit and loss
External donations 2000000.00 525810.97 2000000.00
Abnormal loss 1962312.38 1962312.38
Inventory loss 4693.69 4693.69
Loss of scrap from non-current
assets
14840.94 69625.01 14840.94
Other 172.94 56.74 172.94
Total 3982019.95 595492.72 3982019.95
Other explanation:
76. Income tax expense
(1) Income tax expense
RMB/CNY
Item Current Period Last Period
Current income tax expenses 8075504.29 13790990.10
Deferred income tax expenses 7409789.74 -1921138.04
Total 15485294.03 11869852.06
(2) Adjustment process of accounting profit and income tax expenses
RMB/CNY
Item Current Period
Total profit 231725928.50
Income tax expenses calculated by statutory tax rate 57931482.13
Impact from different tax rate apply with the subsidiary -2440713.51
Impact on cost expenses and losses that unable to deducted -45351677.76
191
Impact of the deductible loss on deferred income tax assets not
recognized in the prior period of use
-556944.32
Unrecognized impacts of deductible temporary differences or
deductible losses on deferred income tax assets in the period
2744541.31
Impact on R&D costs deduction 3158606.18
Income tax expenses 15485294.03
Other explanation
77. Other comprehensive income
Found more in annotations
78. Annotation of cash flow statement
(1) Cash received with other operating activities concerned
RMB/CNY
Item Current Period Last Period
Interest income 2185171.96 3629642.58
Government grants 4448353.51 6683802.85
Intercourse funds and other 180418202.50 14233661.27
Total 187051727.97 24547106.70
Note of cash received with other operating activities concerned:
Nil
(2) Cash paid with other operating activities concerned
RMB/CNY
Item Current Period Last Period
Expenses 102412945.42 105648051.11
Intercourse funds and other 153621034.86 98464612.88
Total 256033980.28 204112663.99
Note of cash paid with other operating activities concerned:
Nil
(3) Cash received with other investment activities concerned
RMB/CNY
Item Current Period Last Period
192
Note of cash received with other investment activities concerned
Nil
(4) Cash paid related with investment activities
RMB/CNY
Item Current Period Last Period
Note of cash paid related with investment activities
Nil
(5) Cash received with other financing activities concerned
RMB/CNY
Item Current Period Last Period
Investment amount received in advance 24500000.00
Total 24500000.00
Note of cash received with other financing activities concerned
Nil
(6) Other cash paid related with financing activities
RMB/CNY
Item Current Period Last Period
Relevant expenses for bonus paid 72997.72
Total 72997.72
Note of other cash paid related with financing activities:
Nil
79. Supplementary information to statement of cash flow
(1) Supplementary information to statement of cash flow
RMB/CNY
Supplementary information Current period Last period
1. Net profit adjusted to cash flow of
operation activities:
-- --
Net profit 216240634.47 207677952.67
Add: Impairment provision for assets
64087863.65
32562605.32
Depreciation of fixed assets consumption of 25585678.98 36676343.25
193
oil assets and depreciation of productive
biology assets
Amortization of intangible assets
10078858.18
11002051.40
Amortization of long-term pending expenses 10979032.68 3423495.33
Loss from disposal of fixed assets intangible
assets and other long-term assets (income is
listed with “-”)
4184.59 210840.01
Losses on scrapping of fixed assets (incomeis listed with “-“)
14840.94 69625.01
Loss from change of fair value (income islisted with “-“)
-28381.21 425718.15
Financial expenses (income is listed with
“-”)
10087784.34 1914851.35
Investment loss (income is listed with “-”) -7167936.04 -1343407.46
Decrease of deferred income tax assets
(increase is listed with “-”)
18886.47 -1641669.44
Decrease of deferred income tax
asset( (increase is listed with “-”)
174506.94 -317403.72
Decrease of inventory (increase is listed with
“-”)
-235691486.95 -112655074.54
Decrease of operating receivable accounts
(increase is listed with “-”)
-118497256.23
104836662.81
Increase of operating payable accounts
(decrease is listed with “-”)
-365316840.56 -229981344.84
Net cash flow arising from operating
activities
-389429629.75
52861245.30
2. Material investment and financing not
involved in cash flow
-- --
3. Net change of cash and cash equivalents: -- --
Balance of cash at period end
189914485.39
359443755.10
Less: Balance of cash at year-begin 631638339.68 544440739.45
Net increasing of cash and cash equivalents
-441723854.29
-184996984.35
(2) Net cash paid for obtaining subsidiary in the Period
RMB/CNY
194
Amount
Including: --
Including: --
Including: --
Other explanation:
(3) Net cash received by disposing subsidiary in the Period
RMB/CNY
Amount
Including: --
Including: --
Including: --
Other explanation:
(4) Constitution of cash and cash equivalent
RMB/CNY
Item Ending balance Opening balance
I. Cash
189914485.39
631638339.68
Including: Cash on hand 248295.15 282322.45
Bank deposit available for payment
at any time
189525109.14 631190032.12
Other monetary fund available for
payment at any time
141081.10 165985.11
III. Balance of cash and cash equivalent at
period-end
189914485.39
631638339.68
Other explanation:
80. Notes of changes of owners’ equity
Explain the name and adjusted amount in “Other” at end of last period:
Nil
81. Assets with ownership or use right restricted
RMB/CNY
Item Ending book value Reasons for restriction
195
Fixed assets 371805770.40
According to the long-term loan mortgage contract signed by Dongguan Shenliang Logistics a
subsidiary of the Company and Agricultural Development Bank Dongguan Logistics
mortgaged the land (DFGY (2014) DT No. 6) of No. 32 Jianshe Road Masan Village Machong
Town Dongguan City and the grain storage and terminal facilities to be built and other buildings
and structures on the ground to Agricultural Development Bank as collateral for the loan. In
addition according to the “44191000-2018 (Dongben) Zi No. 0100” loan contract signed by
Dongguan Shenliang Logistics and China Agricultural Development Bank Dongguan Logistics
mortgaged the land “Yue (2016) DGSBDCQ No. 0028527” to the China Agricultural
Development Bank as borrowing collateral.
Intangible
assets
83859264.48
According to the long-term loan mortgage contract signed by Dongguan Shenliang Logistics a
subsidiary of the Company and Agricultural Development Bank Dongguan Logistics
mortgaged the land (DFGY (2014) DT No. 6) of No. 32 Jianshe Road Masan Village Machong
Town Dongguan City and the grain storage and terminal facilities to be built and other buildings
and structures on the ground to Agricultural Development Bank as collateral for the loan. In
addition according to the “44191000-2018 (Dongben) Zi No. 0100” loan contract signed by
Dongguan Shenliang Logistics and China Agricultural Development Bank Dongguan Logistics
mortgaged the land “Yue (2016) DGSBDCQ No. 0028527” to the China Agricultural
Development Bank as borrowing collateral.
Construction
in progress
76182755.87
According to the long-term loan mortgage contract signed by Dongguan Shenliang Logistics a
subsidiary of the Company and Agricultural Development Bank Dongguan Logistics
mortgaged the land (DFGY (2014) DT No. 6) of No. 32 Jianshe Road Masan Village Machong
Town Dongguan City and the grain storage and terminal facilities to be built and other buildings
and structures on the ground to Agricultural Development Bank as collateral for the loan. In
addition according to the “44191000-2018 (Dongben) Zi No. 0100” loan contract signed by
Dongguan Shenliang Logistics and China Agricultural Development Bank Dongguan Logistics
mortgaged the land “Yue (2016) DGSBDCQ No. 0028527” to the China Agricultural
Development Bank as borrowing collateral.
Intangible
assets
35798712.71
According to the loan contract of “Guangdong DG 2017 NGDZ No. 006” signed by Dongguan
Food Industrial Park a subsidiary of the Company and Bank of Communications Guangdong
Branch Dongguan Food Industry Park mortgaged its two pieces of lands (DFGY (2009) DT No.
190) and (DFGY (2012) DT No. 152) to Bank of Communications Guangdong Branch as
collateral for the borrowing.Total 567646503.46 --
Other explanation:
82. Foreign currency monetary items
(1) Foreign currency monetary items
RMB/CNY
Item
Ending foreign currency
balance
Convert rate Ending RMB balance converted
196
Monetary funds -- -- 2709685.00
Including: USD 362401.02 6.8747 2491398.31
EURO
HKD 248148.93 0.8797 218286.69
Account receivable -- -- 2013144.22
Including: USD 278280.34 6.8747 1913093.86
EURO
HKD 113737.53 0.8797 100050.36
Long-term loans -- --
Including: USD
EURO
HKD
Other explanation:
Nil
(2) Explanation on foreign operational entity including as for the major foreign operational entity
disclosed main operation place book-keeping currency and basis for selection; if the book-keeping
currency changed explain reasons
□ Applicable √Not applicable
83. Hedging
Disclosed hedging items and relevant hedging instrument based on hedging’s category disclosed qualitative and quantitative
information for the arbitrage risks:
84. Government grants
(1) Government grants
RMB/CNY
Category Amount Item
Amount reckoned into
current gains/losses
(1) Base of further processing for tea and nature plants 579537.71 Deferred income 520462.29
(2) Enterprise technology center is a municipal R&D center.
Subsidies for industrial technological advancement
1987301.17 Deferred income 0.00
197
(3) Project grants for years for agricultural district Xihu Zone 312307.72 Deferred income 0.00
(4)Key technology research and development for the
preparation of high-quality aroma extracts based on the use of
tea aroma precursors
238833.31 Deferred income 2490.27
(5)Key technology research and development for the
preparation of high-quality aroma extracts based on the use of
tea aroma precursors
138904.07 Deferred income 104329.55
(6) Finance Discount 337222.22 Deferred income 0.00
(7) Industrialization of instant tea powder 2084136.67 Deferred income 0.00
(8) Grant for key technology research and industrialization of
instant tea powder
153011.21 Deferred income 0.00
(9) Special fund for the development of strategic emerging
industries in Shenzhen(plant deep processing engineering)
(Shen Development & Reform No. 20131601)
3538892.95 Deferred income 0.00
(10)Construction amount for 50 tons for clearly processing for
Mingyou tea
437500.00 Deferred income 62500.00
(11) Subsidy for tea seeding of New Tea Garden in Wangkou 45575.32 Deferred income 1941.24
(12) Subsidy for supply system construction of agricultural
products
750000.00 Deferred income 0.00
(13) Grain storage project of Dongguan Shenliang Logistics
Co. Ltd. - Storage A
8111289.27 Deferred income 131128.56
(14) Phase II of grain storage project of Dongguan Shenliang
Logistics Co. Ltd.- Storage B
32453049.26 Deferred income 515650.26
(15) Grain oil and food headquarters and innovative public
service platform of Dongguan Shenliang Logistics Co. Ltd.
18000000.00 Deferred income 0.00
(16)Special funds for intelligent upgrading and transformation
of grain warehouse for the 2017 “Grain Safety Project”
5100000.00 Deferred income 0.00
(17) Construction of 450000 ton silos and 60000 ton film silos
-CDE warehouse. Gas storage bin
17491764.71 Deferred income 0.00
(18) Special fund for agricultural development of 2016-
agricultural product safety testing project- capacity building of
the third party inspection institution expansion evaluation
492000.00 Deferred income 0.00
(19)Agricultural product safety testing project of the special
fund for agricultural development of 2016 - Central
investment fund
1026000.00 Deferred income 0.00
(20) Construction of O2O community sales service system for
high quality grain and oil based on B2C E-commerce platform
1770123.18 Deferred income 19288.02
(21) Industrialization of Doximi E-commerce platform 2383576.57 Deferred income 430107.44
198
(22) Commercial circulation development project funding for
year of 2017
524000.00 Deferred income 0.00
(23) Intelligent management of grain depot based on mobile
internet
766666.62 Deferred income 100000.02
(24) R&D subsidy for 2018 from Shenzhen Science &
Technology Innovation Committee
216000.00 Other income 216000.00
(25) Other subsidy 1023166.45 Other income 1023166.45
(26) Received the construction subsidy for top talents project
of Guangdong Provincial Grain & Material Reserve Bureau
30000.00 Other income 30000.00
(27) Grain talents program subsidy 20269.70 Other income 20269.70
(28) Received the loan discount for leading agricultural
enterprises
388300.00 Other income 388300.00
(29) Service charges are refund by Taxation Bureau 126043.99 Other income 126043.99
(30) Received the intermediary fee subsidy for mergers and
acquisition of the Nanshan Economic promotion Bureau
738700.00 Other income 738700.00
(31) Received the employee social insurance subsidy (1-9) of
Wuyuan County Finance Bureau for 2018
470078.93 Other income 470078.93
(32) Received the patent award for 2018 from Shangrao
Intellectual Property Bureau
50000.00 Other income 50000.00
(33) Received the guiding funds for industrial development
for 2018 from Industry and Information Technology Bureau
(Fiscal Appropriation)
170697.00 Other income 170697.00
(34) Received the high-tech enterprise award for 2018 from
Industry and Information Technology Bureau (Fiscal
Appropriation)
200000.00 Other income 200000.00
(35) Received the provincial R&D center fund for 2018 from
Industry and Information Technology Bureau (Fiscal
Appropriation)
50000.00 Other income 50000.00
(36) Amount of the new project of 50 tons clean mingou tea
processing for first half of 2019
62500.00 Other income 62500.00
Total 102267448.03 5433653.72
(2) Government grants rebate
□ Applicable √Not applicable
Other explanation:
199
85. Other
VIII. Changes of consolidation range
1. Enterprise merger not under the same control
(1) Enterprise merger not under the same control
RMB/CNY
Acquiree
Time point
for equity
obtained
Cost of
equity
obtained
Ratio of
equity
obtained
Acquired
way Equity
obtained
way
Purchasing
date
Standard to
determine
the
purchasing
date
Income of
acquiree
from
purchasing
date to
period-end
Net profit
of acquiree
from
purchasing
date to
period-end
Other explanation:
(2) Combination cost and goodwill
RMB/CNY
Combination cost
Determination method for fair value of the combination cost and contingent consideration and changes:
Main reasons for large goodwill resulted:
Other explanation:
(3) Identifiable assets and liability on purchasing date under the acquiree
RMB/CNY
Fair value on purchasing date Book value on purchasing date
Determination method for fair value of the identifiable assets and liabilities:
Contingent liability of the acquiree bear during combination:
Other explanation:
(4) Gains or losses arising from re-measured by fair value for the equity held before purchasing date
Whether it is a business combination realized by two or more transactions of exchange and a transaction of obtained control r ights in
the Period or not
□Yes √No
200
(5)On purchasing date or period-end of the combination combination consideration or fair value of
identifiable assets and liability for the acquiree are un-able to confirm rationally
(6) Other explanation
2. Enterprise combined under the same control
(1) Enterprise combined under the same control in the Period
RMB/CNY
Acquiree
Equity ratio
obtained in
combination
Basis of
combined
under the
same control
Combination
date
Standard to
determine the
combination
date
Income of the
combined
party from
period-begin
of
combination
to the
combination
date
Net profit of
the combined
party from
period-begin
of
combination
to the
combination
date
Income of the
combined
party during
the
comparison
period
Net profit of
the combined
party during
the
comparison
period
Other explanation:
(2) Combination cost
RMB/CNY
Combination cost
Explanation on contingent consideration and its changes:
Other explanation:
(3) Book value of the assets and liability of the combined party on combination date
RMB/CNY
On purchasing date At end of last period
Contingent liability of the combined party bear during combination:
Other explanation:
3. Reverse purchase
Basic transaction information basis of counter purchase whether making up business due to the assets and liability reserved by listed
company and basis determination of combination cost amount and calculation on adjusted equity by equity transaction
201
4. Disposal Subsidiary
Whether there is a subsidiary disposal on one time which is loss control of rights
□Yes √No
Whether there is a subsidiary disposal by steps through multiple trading and loss control of rights in the period
□Yes √No
5. Other reasons for consolidation range changed
Consolidation scope changes caused by other reasons (eg newly establish subsidiaries liquidate subsidiaries etc.) and the related
circumstances:
6. Other
IX. Equity in other entity
1. Equity in subsidiary
(1) Constitute of enterprise group
Subsidiary
Main operation
place
Registered place Business nature
Share-holding ratio
Acquired way
Directly Indirectly
Shenbao
Huacheng
Shenzhen Shenzhen Manufacturing 100.00% Establishment
Wuyuan Ju Fang
Yong
Shangrao Shangrao Manufacturing 100.00% Establishment
Shenbao Sanjing Huizhou Shenzhen Manufacturing 100.00% Establishment
Huizhou Shenbao
Technology
Huizhou Huizhou Comprehensive 100.00% Establishment
Shenbao Property Shenzhen Shenzhen
Property
management
100.00% Establishment
Shenbao
Industrial &
Trading
Huizhou Shenzhen
Wholesale
business
100.00% Establishment
Hangzhou Ju
Fang Yong
Hangzhou Hangzhou Comprehensive 100.00% Establishment
Shenbao
Technology
Center
Shenzhen Shenzhen
Development
consultant and
transfer of
technology
100.00% Establishment
Fuhaitang Hangzhou Hangzhou Tea planting 100.00% Acquisition
202
Ecological production and
sales
Chunshi Network Hangzhou Hangzhou
Wholesale
business
100.00% Establishment
Shenshenbao
Investment
Shenzhen Shenzhen
Investment
management
100.00% Establishment
Shenshenbao
Tea Culture
Shenzhen Shenzhen Commerce 100.00% Establishment
Ju Fang Yong
Trading
Hangzhou Hangzhou
Wholesale
business
60.00% Establishment
Yunnan Supply
Chain
Pu’er Pu’er
Wholesale
business
100.00% Establishment
Huizhou Shenbao
Food
Shenzhen Shenzhen
Wholesale
business
100.00% Establishment
Shenbao Rock
Tea
Wuyishan Wuyishan Manufacturing 100.00% Establishment
Pu’er Tea Trading
Center
Pu’er Pu’er Service industry 55.00% Establishment
Shenbao
Tea-Shop
Shenzhen Shenzhen Commerce 100.00% Establishment
Fuhaitang
Catering
Hangzhou Hangzhou Catering 100.00% Establishment
SZCG Shenzhen Shenzhen
Grain & oil
trading
100.00%
Combine under
the same control
Shenzhen Flour Shenzhen Shenzhen Flour processing 100.00%
Combine under
the same control
Hualian Grain &
oil trading
Shenzhen Shenzhen
Grain & oil
trading
100.00%
Combine under
the same control
Hainan Haitian Haikou Haikou Feed production 51.00% 49.00%
Combine under
the same control
Shenliang Quality
Inspection
Shenzhen Shenzhen Inspection 100.00%
Combine under
the same control
Shenliang Doximi Shenzhen Shenzhen E-commerce 100.00%
Combine under
the same control
Shenliang
Cold-Chain
Logistic
Shenzhen Shenzhen
Fresh food
management
on-line
100.00%
Combine under
the same control
Shenliang Big
Kitchen
Shenzhen Shenzhen
Sales and
processing of
70.00%
Combine under
the same control
203
grain oil and
products
Shenliang Real
Estate
Development
Shenzhen Shenzhen
Real estate
development and
property
management
100.00%
Combine under
the same control
Shenliang
Property
Shenzhen Shenzhen
Property
management
100.00%
Combine under
the same control
Shenliang Storage
(Yingkou) )
Yingkou Yingkou Storage 100.00%
Combine under
the same control
Dongguan
Shenliang
Logistics
Dongguan Dongguan Storage logistics 51.00%
Combine under
the same control
Dongguan Food
Industrial Park
Dongguan Dongguan
Port operation
food production
51.00%
Combine under
the same control
Dongguan Food
Trade
Dongguan Dongguan
Food
production
51.00%
Combine under
the same control
Dongguan
Jinying
Dongguan Dongguan Feed biofertilizer 51.00%
Combine under
the same control
Shuangyashan
Shenliang
Zhongxin
Shuangyashan Shuangyashan
Construction of
food base and
development of
related
complementary
facility
51.00%
Combine under
the same control
Hongxinglong
Nongken
Industrial Park
Shuangyashan Shuangyashan
Construction of
food base and
development of
related
complementary
facility
51.00%
Combine under
the same control
Explanation on share-holding ratio in subsidiary different from ratio of voting right:
Basis for controlling the invested entity with half or below voting rights held and without controlling invested entity but with over
half and over voting rights:
Major structured entity included in consolidate statement:
Basis of termination of agent or consignor:
Other explanation:
(2) Important non-wholly-owned subsidiary
RMB/CNY
204
Subsidiary
Share-holding ratio of
minority
Gains/losses attributable
to minority in the Period
Dividend announced to
distribute for minority in
the Period
Ending equity of
minority
Dongguan Shenliang
Logistics
49.00% 5443741.51 153130186.36
Explanation on holding ratio different from the voting right ratio for minority shareholders:
Other explanation:
(3) Main finance of the important non-wholly-owned subsidiary
RMB/CNY
Subsidia
ry
Ending balance Opening balance
Current
assets
Non-curr
ent
assets
Total
assets
Current
liabilities
Non-curr
ent
liabilities
Total
liabilities
Current
assets
Non-curr
ent
assets
Total
assets
Current
liabilities
Non-curr
ent
liabilities
Total
liabilities
Donggua
n
Shenlian
g
Logistics
248138
218.07
115117
0302.88
139930
8520.95
216154
682.24
870643
254.30
108679
7936.54
634938
480.46
920908
724.11
155584
7204.57
679025
611.19
610420
685.53
128944
6296.72
RMB/CNY
Subsidiary
Current Period Last Period
Operating
income
Net profit
Total
comprehensi
ve income
Cash flow
from
operation
activity
Operating
income
Net profit
Total
comprehensi
ve income
Cash flow
from
operation
activity
Dongguan
Shenliang
Logistics
122244975
5.98
11109676.5
6
11109676.5
6
97553848.2
8
905720767.
08
12516721.4
1
12516721.4
1
-19848597.9
7
Other explanation:
(4) Significant restrictions on the use of enterprise group assets and pay off debts of the enterprise group
(5) Financial or other supporting offers to the structured entity included in consolidated financial statement
range
Other explanation:
205
2. Transaction that has owners equity shares changed in subsidiary but still with controlling rights
(1) Owners equity shares changed in subsidiary
(2) Impact on minority’s interest and owners’ equity attributable to parent company
RMB/CNY
Other explanation
3. Equity in joint venture and associated enterprise
(1) Important joint venture or associated enterprise
Joint venture or Associated
enterprise
Main
operation
place
Registered
place
Business nature
Share-holding ratio Accounting
treatment on
investment for
joint venture and
associated
enterprise
Directly Indirectly
Zhuhai Hengxing Feed Industrial
Co. Ltd.
Zhuhai Zhuhai Aquatic fee and animal fee 40.00% Equity
Shenzhen Duoxi Equity Investment
Fund Management Co. Ltd.
Shenzhen Shenzhen
Trusted equity investment
fund
35.00% Equity
Shenzhen Shenyuan Data Tech.
Co. Ltd
Shenzhen Shenzhen
Design for information
system software
development
40.00% Equity
Shenliang Intelligent Wulian Equity
Investment Fund (Shenzhen)
Partnership Enterprise (Limited)
Shenzhen Shenzhen
Equity investment;
investment consultant
49.02% Equity
Changzhou Shenbao Chacang
E-business Co. ltd.
Changzhou
Changzho
u
Manufacturing 33.00% Equity
Huizhou Shenbao Manan
Bio-technology Co. Ltd.
Huizhou Huizhou Manufacturing 51.00% Equity
Shenzhen Shichumingmen
Restaurant Management Co. Ltd.Shenzhen Shenzhen Catering 51.00% Equity
Guangzhou Shenbao Mendao Tea
Co. Ltd
Guangzhou
Guangzho
u
Retail 45.00% Equity
Holding shares ratio different from the voting right ratio:
Has major influence with less 20% voting rights hold or has minor influence with over 20% (20% included) voting rights hold:
206
(2) Main financial information of the important joint venture
RMB/CNY
Ending balance/Current Period Opening balance/Last Period
Other explanation
(3) Main financial information of the important associated enterprise
RMB/CNY
Ending balance/Current Period Opening balance/Last Period
Book value of the equity investment for
associated enterprise
73362651.19 70999666.81
Net profit 7096756.53 1374764.19
Total comprehensive income 7096756.53 1374764.19
Other explanation
(4) Financial summary for non-important Joint venture and associated enterprise
RMB/CNY
Ending balance/Current Period Opening balance/Last Period
Joint venture: -- --
Amount based on share-holding ratio -- --
Associated enterprise: -- --
Amount based on share-holding ratio -- --
Other explanation
(5) Major limitation on capital transfer ability to the Company from joint venture or associated enterprise
(6) Excess loss occurred in joint venture or associated enterprise
RMB/CNY
Joint venture/Associated enterprise
Cumulative un-recognized
losses
Un-recognized losses not
recognized in the Period (or
net profit enjoyed in the
Period)
Cumulative un-recognized
losses at period-end
Changzhou Shenbao Chacang E-business
Co. ltd.
8367950.07 126999.270 8494949.33
207
Shenzhen Shichumingmen Restaurant
Management Co. Ltd.
3491151.31 426122.69 3917274.00
Other explanation
(7) Unconfirmed commitment with joint venture investment concerned
(8) Intangible liability with joint venture or affiliates investment concerned
4. Major conduct joint operation
Name
Main place of
operation
Registration place Business nature
Shareholding ratio/ shares enjoyed
Directly In-directly
Share-holding ratio or shares enjoyed different from voting right ratio:
If the co-runs entity is the separate entity basis of the co-runs classification
Other explanation
5. Structured body excluding in consolidate financial statement
Explanation:
6. Other
X. Disclosure of risks relating to financial instruments
Our business operation makes the Company exposed to various financial risks: credit risk liquidity risk and
market risk (mainly refers to exchange risk and interest risk). The general risk management policy of the
Company is to minimize potential negative effects on our financial performance in view of the unforeseeable
financial market.(i) Credit risk
Credit risk refers to the risk of a financial loss caused by the counter party’s failure to fulfill its contractual
obligations. The credit risk mainly arises from monetary funds account receivable and other account receivable so
on. The management has established adequate credit policies and continues to monitor exposure of these credit
risks.The monetary funds held by the Company are mainly deposited in state-controlled banks and other large and
medium-sized commercial banks and other financial institutions. The management believes that these commercial
banks have high reputation and asset status and have no major credit risk and won't create any major losses
caused by the breach of contract of the opposite side.208
For trade receivables and other receivables the Company establishes relevant policies to control exposure of
credit risk. The Company appraises customers’ credit quality based on their financial position possibility to
obtain guarantee from third parties credit history and other factors such as prevailing market conditions and set
corresponding credit terms. Customers’ credit history would be regularly monitored by the Company. For those
customers who have bad credit history the Company will call collection in written form shorten credit term or
cancel credit term to ensure its overall credit risk is under control.The maximum credit risk exposure equals to the carrying value of each financial asset in balance sheet (including
derivative financial instrument). The Company has not provided any guarantee which would otherwise make the
Company exposed to credit risk except for the guarantee for financial carried in Note XI.
(ii) Liquidity risk
Liquidity risk represents the possibility that the Company is not able to acquire sufficient fund to satisfy business
requirement settle debt when it is due and perform other obligation of payment.The finance department continues to monitor capital requirement for short and long term to ensure adequate cash
reserve. In addition it continues to monitor whether borrowing agreement is complied with and seeks for
commitment from major financial institutions for provision of sufficient back-up fund so as to satisfy capital
requirement in a short and long term.(iii) Market risk
1.Exchange risk
The major operation of the Company is located in the PRC and its major operation is settled in Renminbi.However there is also exchange risk in respect of the recognized foreign currency assets and liabilities and future
foreign currency transactions which are mainly denominated in US dollar. Our finance department is responsible
for monitoring scale of foreign currency assets and liabilities and foreign currency transactions to minimize its
exposure to exchange risks. In reporting period the Company did not sign any forward exchange contract or
monetary exchange contract.
2.Interest risk
Our interest risk mainly arises from bank borrowings. Financial liabilities at floating rate expose the Company to
cash flow interest risk and financial liabilities at fixed rate expose the Company to fair value interest risk. The
Company determines the respective proportion of contracts at fixed rate and floating rate based on prevailing
market conditions.The financial department of the Company continuously monitors the interest rate of the Company. The rise in
interest rates will increase the cost of new interest-bearing debts and the interest expense of the Company’s unpaid
209
interest-bearing debts with floating interest rates management will make timely adjustments based on the latest
market conditions.
3.Price risk
The Company purchases and sells products at market prices therefore it is affected by fluctuation of these prices.XI. Disclosure of fair value
1. Ending fair value of the assets and liabilities measured by fair value
RMB/CNY
Item
Ending fair value
First-order Second-order Third-order Total
I. Sustaining measured by fair
value
-- -- -- --
(i)Tradable financial assets 1153309.17 1153309.17
1.Financial assets measured by
fair value and with variation
reckoned into current
gains/losses
1153309.17 1153309.17
(2) Equity instrument
investment
1153309.17 1153309.17
II. Non-persistent measure -- -- -- --
210
2. Recognized basis for the market price sustaining and non-persistent measured by fair value on
first-order
3. Valuation technique and qualitative and quantitative information on major parameters for the fair value
measure sustaining and non-persistent on second-order
4. Valuation technique and qualitative and quantitative information on major parameters for the fair value
measure sustaining and non-persistent on third-order
5. Adjustment information and sensitivity analysis of unobservable parameters for the fair value measure
sustaining and non-persistent on third-order
6. Sustaining items measured by fair value as for the conversion between at all levels reasons for
conversion and policy for conversion time point
7. Changes of valuation technique in the Period
8. Financial assets and liability not measured by fair value
9. Other
XII. Related party and related transactions
1. Parent company
Parent company Registration place Business nature Registered capital
Ratio of shareholding
on the Company
Ratio of voting right
on the Company
Shenzhen Fude
State-owned Capital
Operation Co. Ltd.Shenzhen
Investing in industry
development
operation and
management of the
own property
500 million Yuan 63.79% 63.79%
Explanation on parent company of the enterprise
Ultimate controller of the Company is Shenzhen Municipal People’s Government State-Owned Assets Supervision and
Administration Commission
Other explanation:
2. Subsidiary
Subsidiary of the Company found more in Note IX- Equity in other entity
3. Joint venture and associated enterprise
Joint Venture of the Company found more in Note IX- Equity in other entity
Other cooperative enterprise and joint venture that have related transaction with the Company in the Period or occurred in previous
211
period
Joint venture/Associated enterprise Relationship
Other explanation
4. Other related party
Other related party Relationship with the Enterprise
Shenzhen Agricultural Products Co. Ltd
Shareholder of the Company subsidiary of the actual controller
controlled by the same ultimate controlling party
Zhanjiang Haitian Aquatic Feed Co. Ltd
Subsidiary of the actual controller Controlled by the same
ultimate controlling party
Dongguan Fruit and Vegetable Non-staple Food Market Co. Ltd Minority shareholder of controlling subsidiary
Taizhong Agricultural Co. Ltd
Subsidiary of the actual controller Controlled by the same
ultimate controlling party
Shenzhen Investment Management Co. Ltd
Former shareholder of the Company Controlled by the same
ultimate controlling party
Fujian Wuyishan Yuxing Tea Co. Ltd*1 Minority shareholder of former controlling subsidiary
Shenzhen Fruits and Vegetables Trading Co. Ltd
Wholly-owned subsidiary of Shenzhen Agricultural Products
Co. Ltd
Shenzhen Higreen International Agricultural Products Logistic
Management Co. Ltd
Controlling subsidiary of Shenzhen Agricultural Products Co.
Ltd
Zhanjiang Changshan (Shenzhen) Ecological Aquaculture Co.Ltd
Has the same parent company
Shenzhen Yixin Investment Co. Ltd
Former shareholder of Shenzhen Agricultural Products Co. Ltd
Controlled by the same ultimate controlling party
Other explanation
*1: Fujian Wuyishan Yuxing Tea Co. Ltd. was a minority shareholder of Fujian Wuyishan Shenbao Yuxing Tea Co. Ltd. a former
controlling subsidiary of Hangzhou Ju Fang Yong which is a subsidiary of the Company and the controlling subsidiary was
separated in 2016.
5. Related transaction
(1) Goods purchasing labor service providing and receiving
Goods purchasing/labor service receiving
RMB/CNY
Related party
Related transaction
content
Current Period
Approved transaction
limit
Whether more than
the transaction limit
(Y/N)
Last Period
Goods sold/labor service providing
212
RMB/CNY
Related party
Related transaction
content
Current Period Last Period
Shenzhen Fude State-owned Capital Operation Co. Ltd. Payment for goods 2510.00
Shenzhen Shenyuan Data Tech. Co. Ltd Office space leasing 15358.00 28293.00
Shenzhen Agricultural Products Co. Ltd Sales of tea 219560.00 65000.00
Shenzhen Higreen International Agricultural Products
Logistic Management Co. Ltd
Sales of tea 7410.00
Shichumingmen Company Sales of tea products 246.15
Shenzhen Fruits and Vegetables Trading Co. Ltd Sales of tea 3270.00
Explanation on goods purchasing labor service providing and receiving
(2) Related trusteeship management/contract & entrust management/ outsourcing
Trusteeship management/contract:
RMB/CNY
Client/Contract-o
ut party
Entrusting
party/Contractor
Trustee/assets
contract
Trustee /start Trustee /ends
Managed
earnings /pricing
of the contract
earnings
Managed
earnings
confirmed in the
period / contract
earnings
Related managed/contract:
Entrusted management/outsourcing:
RMB/CNY
Client/Contract-o
ut party
Entrusting
party/Contractor
Entrust /assets
outsourcing
Entrust /start Entrust /ends
Trustee fee /
pricing of the
outsourcing
Entrusted
earnings
confirmed in the
period /
outsourcing costs
Related management/ outsourcing:
(3) Related lease
As a lessor for the Company:
RMB/CNY
Lessee Assets type
Lease income in recognized in
the Period
Lease income in recognized last
the Period
Shichumingmen Management site 580466.28 503949.19
Shenzhen Fude State-owned Capital Office space leasing 84300.00
213
Operation Co. Ltd.
As lessee:
RMB/CNY
Lessor Assets type
Lease income in recognized in
the Period
Lease income in recognized last
the Period
Shenzhen Fude State-owned Capital
Operation Co. Ltd.Warehouse leasing 14217100.00 14217100.00
Shenzhen Fude State-owned Capital
Operation Co. Ltd.Management site 345038.85
Explanation on related lease
The Company's second-level subsidiary Shenzhen Shenshenbao Tea Culture Business Management Co. Ltd.Nanshan Software Industry Base Subbranch subleased the shop located at Room 02 2
nd
Floor Tower A Building
5 Software Industry Base Keyuan Road Nanshan District Shenzhen that it rented from Shenzhen Investment
Holding Co. Ltd. to the Company's associated company Shi Chu Ming Men Company the rental income for this
year was RMB 580466.28 and the pricing of related transactions was based on the market price.
As an asset management unit entrusted by State-owned Assets Supervision and Administration Commission of
Shenzhen Fude Capital signed the “Overall Rental Agreement of Shenzhen Grain Reserve Depot” with Shenzhen
Cereals Group on October 17 2018 the lease term was from October 1 2017 to December 31 2019 it was
agreed to pay an annual total rent of RMB 28434200 based on market prices.
Fude Capital rented out Room 3001-3065 of third floor and 5008-5009 of fifth floor of the main building and
three storeys of darkrooms of Grain Building located at Nanfang No. 656 Hubei Road Luohu District Shenzhen
and Room 2303 located at Building C World Trade Plaza No. 9 Fuhong Road Futian Street to the Company’s
second-tier subsidiaries Shenliang Real Estate and Shenliang Property as office use the lease period is from
August 1 2018 to July 31 2019 and the pricing of related transactions was based on the market price.
(4) Related guarantee
As guarantor
RMB/CNY
Secured party Guarantee amount Guarantee start date Guarantee expiry date
Whether the guarantee
has been fulfilled
Shenbao Huacheng 30000000.00 2018-07-26
Two years after the
expiration of the debt
performance period for
each specific credit under
the main contract
N
As secured party
214
RMB/CNY
Guarantor Guarantee amount Guarantee start date Guarantee expiry date
Whether the guarantee
has been fulfilled
Dongguan Fruit and
Vegetable Non-staple
Food Market Co. Ltd
14700000.00 2017-06-08 2019-04-11 Y
Dongguan Fruit and
Vegetable Non-staple
Food Market Co. Ltd
53571310.66 2016-12-27 2021-12-26 N
Dongguan Fruit and
Vegetable Non-staple
Food Market Co. Ltd
138955864.84 2018-07-27 2032-08-29 N
Explanation on related guarantee
1. According to the “Comprehensive Credit Line Contract” numbered as PY (SZ) ZZ No. A237201707130001
signed by Shenbao Huacheng a subsidiary of the Company with Ping An Bank Shenzhen Branch on July 27
2017 Ping An Bank Shenzhen Branch provided a comprehensive credit line of RMB 30 million to the subsidiary
of the Company Shenbao Huacheng the time limit of the comprehensive credit limit was within 12 months from
the effective date of the contract. In order to ensure that all claims under this comprehensive credit limit can be
repaid the Company has provided a maximum guarantee with guarantee amount of RMB 30000000.00. Except
for the guarantee amount other interests interest and interest penalty and other claims charges are also
guaranteed and the guarantee period is from July 26 2018 to the end of the two-year period from the expiration
date for debt performance of each specific credit line under the master contract.
2. According to the working capital loans contract (Yue DG2017 nian Jie Zi No. 005) entered by the subsidiary
Dongguan Shenliang Logistics and Bank of Communications Dongguan Branch Dongguan Shenliang Logistics
gains a cyclic quota of RMB 30 million with borrowing interest rate of 5.22%. Each loan drawn under this
contract shall be for a period of not more than 12 months and the maturity date for all loans shall be no later than
11
th
April 2019. The Company’s subsidiaries SZCG and Dongguan Fruit and Vegetable Non-staple Food Market
Co. Ltd provided joint liability guarantee for the loans. The amount guaranteed by Dongguan Fruit and Vegetable
Non-staple Food Market Co. Ltd. was RMB 14.7 million and the amount guaranteed by SZCG was RMB 15.3
million. During the guarantee period respectively calculate according to the debt performance period of each
principal debt agreed in the main contract (under opening of the bank acceptance bill/letter of credit/guarantee
letter calculate according to the creditor's advance payment date). The guarantee period under each principal debt
is from the expiration of the debt performance period (or the creditor’s advance payment date) to two years after
the date of the expiration of the debt performance period (or the creditor’s advance payment date) of the main debt
finally due under all main contracts.215
3. According to the bank credit contract of credit No. CN11002181808-160714-SCDGTML2 signed by Dongguan
Shenliang Logistics a subsidiary of the Company and HSBC HSBC will provide a loan credit of not exceeding
RMB 200 million to Dongguan Logistics the applicable interest rate for each loan at each interest period is 90% of
the central bank loan benchmark interest rate applicable on the fixed interest date of the interest period the
borrowing date is from December 27 2016 to December 26 2021. As of December 31 2018 the balance of the loan
principal achieved by Dongguan Shenliang Logistics from HSBC was RMB 109329205.42 and the Company’s
subsidiaries SZCG and Dongguan Fruit and Vegetable Non-staple Food Market Co. Ltd provided joint liability
guarantee for the loans the amount guaranteed by Dongguan Fruit and Vegetable Non-staple Food Market Co.Ltd. was RMB 53571310.66 and the amount guaranteed by SZCG was RMB 55757894.76.
4. According to the loan contract “Yue DG 2017 NGDZ No. 006” signed by Dongguan Food Industrial Park a
subsidiary of the Company and Bank of Communications Dongguan Branch the current loan principal is
respectively RMB 49.80 million RMB 3783400 RMB 30 million and RMB 200 million the loan period is from
July 27 2018 to August 29 2032. The loan interest rate of RMB 200 million is calculated by the benchmark
interest rate for loan of the People’s Bank of China on the loan entry date which is 4.90%; the other three are
calculated by the benchmark interest rate of the People’s Bank of China on the loan entry date after rising by 15%
which is 5.635%. The Company’s subsidiaries SZCG and Dongguan Fruit and Vegetable Non-staple Food
Market Co. Ltd provide joint liability guarantee for the loans the amount guaranteed by Dongguan Fruit and
Vegetable Non-staple Food Market Co. Ltd is RMB 138955864.84 and the amount guaranteed by SZCG is
RMB 144627532.80.
(5) Related party’s borrowed funds
RMB/CNY
Related party Borrowing amount Starting date Maturity date Note
Borrowing
Lending
(6) Related party’s assets transfer and debt reorganization
RMB/CNY
Related party Related transaction content Current Period Last Period
(7) Remuneration of key manager
RMB/CNY
Item Current Period Last Period
216
(8) Other related transaction
6. Receivable and payable of related party
(1) Receivable item
RMB/CNY
Item Name Related party
Ending balance Opening balance
Book balance Bad debt provision Book balance Bad debt provision
Account receivable
Shenzhen Fude
State-owned Capital
Operation Co. Ltd.
42150.00
421.50
Account receivable
Shenzhen
Agricultural
Products Co. Ltd
55000.00 89.60 8960.00 89.60
Account receivable
Shenzhen Higreen
International
Agricultural
Products Logistic
Management Co.Ltd
7410.00 74.10
Other account
receivable
Changzhou Shenbao
Chacang Company
20618710.83 18024144.51 20413947.34 17819381.02
Other account
receivable
Shenzhen Higreen
International
Agricultural
Products Logistic
Management Co.Ltd
50000.00 500.00 50000.00 500.00
Other account
receivable
Shichumingmen 1365179.36 275978.87 1429898.28 275978.87
(2) Payable item
RMB/CNY
Item Name Related party Ending book balance Opening book balance
Other account payable
Zhanjiang Changshan
(Shenzhen) Ecological
Aquaculture Co. Ltd
7972700.83 7967662.50
Other account payable
Shenzhen Duoxi Equity
Investment Fund Management
39906.00 41486.00
217
Co. Ltd.
Other account payable
Shenzhen Fruits and Vegetables
Trading Co. Ltd
245714.59 245714.59
Other account payable
Shenzhen Investment
Management Co. Ltd
3510297.20 3510297.20
Other account payable
Shenzhen Fude State-owned
Capital Operation Co. Ltd.
67762184.76 53470612.86
Dividend payable
Shenzhen Investment
Management Co. Ltd
2690970.14 2690970.14
7. Related party commitment
8. Other
XIII. Share-based payment
1. Overall situation of share-based payment
□ Applicable √Not applicable
2. Share-based payment settled by equity
□ Applicable √Not applicable
3. Share-based payment settled by cash
□ Applicable √Not applicable
4. Modification and termination of share-based payment
Nil
5. Other
Nil
XIV. Commitment or contingency
1. Important commitments
Important commitments on balance sheet date
The Company has no important commitments that need to disclosed up to 30
th
June 2019
218
2. Contingency
(1)Contingency on balance sheet date
1. Contingencies arising from pending litigation or arbitration and its financial impact
(1) Disputes over the loan contracts between Changzhou Shenbao Chacang E-commence Co. Ltd. the Company
and Shenzhen Agricultural Products Financing Guarantee Co. Ltd.On July 15 2016 Shenzhen Agricultural Products Financing Guarantee Co. Ltd. (hereinafter referred to as
Agricultural Products Guarantee Company) submitted a “Civil Appeal” to the People’s Court of Futian District
Shenzhen requesting Changzhou Shenbao Chacang Company to repay the loan principal amount of RMB
5000000.00 the interest of RMB 389968.52 and the interest penalty of RMB 3200271.79 (the interest penalty
was temporarily calculated to June 30 2016 which shall be actually calculated to the date of the full repayment of
the borrowing); and pay the compensation of RMB 100000.00 (5 million Yuan × 2%); two items in total were
RMB 8690240.31; the Company undertook joint liability for the loan of RMB 5000000.00.
On May 31 2017 Shenzhen Futian District Court made the first-instance judgment and ruled Changzhou
Shenbao Chacang Company to repay the loan principal of RMB 5 million and the interest and interest penalty the
Company did not need to undertake joint liability for the loan of RMB 5 million of Changzhou Shenbao Chacang
Company. On July 4 2017 the Agricultural Products Guarantee Company filed an appeal on October 13 2017
and Shenzhen Intermediate People’s Court held the second instance hearing.
On April 26 2019 the Shenzhen Intermediate People's Court made a civil judgment (Civil Judgment (2017) Yue
03 Min Zhong No. 12296) and judged Shenzhen Shenbao Industrial Co. Ltd. (now renamed as Shenzhen Cereals
Holdings Co. Ltd.) to undertake a joint and several liability for the of Changzhou Shenbao Chacang E-Commerce
Co. Ltd. within the scope of 3.5 million yuan. Shenzhen Shenbao Industrial Co. Ltd. (now renamed as Shenzhen
Cereals Holdings Co. Ltd.) has the right to claim compensation from Changzhou Company after the payment.
The judgment has taken effectcurrently it’s in a reconciliation
(2) Contract disputes between the Company’s subsidiaries Mount Wuyi Shenbao Rock Tea Co. Ltd. (hereinafter
referred to as Wuyishan Rock Tea Company) and Hangzhou Jufangyong Holdings Co. Ltd. (hereinafter referred
to as Jufangyong Company) and Wuyishan Jiuxing Tea Co. Ltd. (hereinafter referred to as Jiuxing Company)
Fujian Wuyishan Yuxing Tea Co. Ltd. (hereinafter referred to as Yuxing Company) Xingjiu Tea Co. Ltd. Chen
Yuxing Chen Guopeng
On September 22 2017 Jufangyong Company Xingjiu Tea Co. Ltd. Yuxing Company Chen Yuxing and Chen
Guopeng signed an “Formal Agreement on the Separation of Fujian Wuyishan Shenbao Yuxing Tea Co. Ltd.”
219
according to the separation agreement: the original Shenbao Yuxing Company was separated after the separation
Jufangyong Company held 100% equity of the newly established company (i.e. Shenbao Rock Tea Company)
and Yuxing Company and Xingjiu Tea Company jointly held 100% equity of the surviving company (Jiuxing
Company); Shenbao Rock Tea Company got receivables of RMB 7273774.01 which was guaranteed by Jiuxing
Company to achieve RMB 2 million within one year after separation and the remaining amount would be returned
within 2 years. Chen Yuxing and Chen Guopeng as the actual controllers of Jiuxing Company Yuxing Company
and Xingjiu Tea Company assumed joint responsibility for the joint guarantee to Shenbao Rock Tea Company and
Jufangyong Company for all the obligations and responsibilities stipulated in the “Separation Agreement”.
As of September 22 2018 the time limit stipulated in the “Separation Agreement” for the realization of four
receivables had expired and Shenbao Rock Tea Company still had RMB 5212301.40 unrecovered. On
December 6 2018 Shenbao Rock Tea Company and Hangzhou Jufangyong Company applied for arbitration to
Shenzhen Court of International Arbitration (Shenzhen Arbitration Commission) for the above matters and
requested Jiuxing Company to pay RMB 5272934.01 to Shenbao Rock Tea Company and requested Yuxing
Company Xingjiu Tea Company Chen Yuxing and Chen Guopeng to assume joint liability.
On April 18 2019 Shenzhen International Arbitration Court heard the arbitration case in court. Since relevant
matters are still to be determined and ascertained the two parties concerned shall provide supplementary defense
materials to the court. Currently the case has not ye been arbitrated by Shenzhen International Arbitration Court.
As of 30
th
June 2019 the accumulated bad debt provision accrual by the Company was RMB 3458370.94.
(3) Disputes on mung bean business between Shenzhen Cereals Group (SZCG) and Jilin Tongyu County Shengda
Company
In August 2007 Shenzhen Cereals Group and Tongyu County Shengda Grain and Oil Trading Co. Ltd.(hereinafter referred to as Shengda Company) signed the “Mung Bean Entrusted Acquisition Processing andStorage Contract” from October 2007 to May 2008 totally 4918.00 tons of mung beans were acquired the
Company paid payment for goods of RMB 30 million. According to the contract after the completion of the
entrusted acquisition Shengda Company has the obligations to assist in the sale of goods and buy-back. Shengda
Company did not fully fulfill its obligations and Shenzhen Cereals Group also carried out various forms of
collection. In September 2010 Shenzhen Cereals Group sued Shengda Company for repayment of its arrears and
interest. The two parties reached an accommodation during the court trial and Futian District People’s Court of
Shenzhen issued a “Paper of Civil Mediation” but Shengda Company did not fully fulfill the repayment
obligation Shenzhen Cereals Group has applied to the court for enforcement. As of 30
th
June 2019 the book
receivables amounted to RMB 5602468.81 and the execution of remaining funds has large uncertainties. The
Company has fully made provision for bad debts of RMB 5602468.81.
220
(4) Contract disputes between Flour Company and Shenzhen Fujin Food Industry Co. Ltd.
On May 31 2013 Shenzhen Fujin Food Industry Co. Ltd. (hereinafter referred to as Fujin Company) signed a
“Purchases and Sales Contract” with Flour Company agreed that Flour Company would supply the moon cake
tailored flour and the tailored wheatmeal for cakes and pastries to Fujin Company. Later Fujin Company sued
Flour Company it said that the lipase (a processing aid) in the flour supplied by Flour Company to Fujin
Company was active causing the “acid value” of the moon cakes and fillings made from it exceed the food safety
standards which caused huge losses to Fujin Company so it advocated that Flour Company should bear the
corresponding liability for compensation and compensate for the property loss of Fujin Company of RMB
9784485.55; the litigation costs should be borne by Flour Company.
On November 29 2014 the Nanshan District People’s Court of Shenzhen made the first-instance judgment ([2014]
SNFMYCZ No.45) and considered that Fujin Company failed to prove that its so-called problem product with too
high “acid value” was caused by the lipase activity of the flour supplied by Flour Company it has not been proven
that the raw materials of the problem food were supplied by Flour Company; secondly the relevant standards of
the Ministry of Health allow the addition of active lipase to the flour raw material therefore the court ruled that
all claims of Shenzhen Fujin Food Industry Co. Ltd. were rejected.On June 5 2015 the Shenzhen Intermediate People’s Court made a ruling ([2015] SZFMZZ No. 563)
considering that the court of first instance could not find out what standards should be applied to the quality of the
flour products involved in the case nor could it found that the obligation to remove processing aids in flour should
be attributed to the flour supplier or the food producer. Therefore the civil judgment [2014] SNFMYCZ No.45
was revoked and sent back to the Nanshan District People’s Court for retrial.
On December 21 2017 People's Court of Nanshan District of Shenzhen made the first-instance judgment of
retrial which rejected all claims of Shenzhen Fujin Food Industry Co. Ltd.On June 10 2019 the Shenzhen Intermediate People's Court made the second-instance judgment (Civil Judgment
(2018) Yue 03 Min Zhong No. 7911) and the judgment rejected the appeal of Shenzhen Fujin Food Industry Co.
Ltd. and upheld the original judgment.
(5) Contract disputes among Shenzhen Cereals Group Hualian Grain and Oil Guangzhou Jinhe Feed Co. Ltd.
and Huang Xianning Import Agent
From October 2005 to January 2007 Shenzhen Cereals Group Hualian Grain and Oil and Guangzhou Jinhe Feed
Co. Ltd. (hereinafter referred to as Guangzhou Jinhe Company) signed 20 “Import Agent Contracts” agreed that
Shenzhen Cereals Group and Hualian Grain and Oil agent Guangzhou Jinhe Company to import Peruvian
221
fishmeal. In August 2007 Hualian Grain and Oil Guangzhou Jinhe Company and Huangxianning signed the
“Guarantee Contract” agreed that Huangxianning would guarantee that all payables of Guangzhou Jinhe
Company under the trade contracts signed by Hualian Grain and Oil and Guangzhou Jinhe Company would be
paid on time. Later due to Guangzhou Jinhe Company’s insufficient payment of goods and import agency fees
Shenzhen Cereals Group and Hualian Grain and Oil filed a lawsuit to Futian District People’s Court of Shenzhen.
On February 16 2015 the Futian District People’s Court of Shenzhen made the first-instance judgment ([2014]
SFFMECZ No. 786) and sentenced Guangzhou Jinhe Company to pay RMB 10237385.74 to Shenzhen Cereals
Group and Hualian Grain and Oil and bear the case acceptance fee of RMB 83224.00; Huang Xianning does not
need to bear the joint and several liability.
As Guangzhou Jinhe Company refused to accept the above first-instance judgment it lodged an appeal to the
Shenzhen Intermediate People’s Court claiming that the prosecution of Shenzhen Cereals Group and Hualian
Grain and Oil had exceeded the time limit for litigation. On March 30 2017 the Shenzhen Intermediate People’s
Court made the second-instance judgment (Civil Judgment [2015] SZFSZZ No.1767) and the judgment rejected
Guangzhou Jinhe Company’s appeal and upheld the original judgment.The case is still in enforcement and the other party has not paid any money Shenzhen Cereals Group has made
provision for bad debts in proportion to 100% of the accounts receivable of RMB 10455600 of Guangzhou Jinhe
Company.
According to the “Commitment Letter of Shenzhen Fude State-owned Capital Operation Co. Ltd. on the PendingLitigation of Shenzhen Cereals Group Co. Ltd.” If Shenzhen Cereals Group Co. Ltd. and its holding subsidiaries
suffer any claims compensation losses or expenses due to the contract disputes with Guangzhou Jinhe Feed Co.Ltd. and Huangxianning Import Agent Shenzhen Fude State-owned Capital Operation Co. Ltd. will assume the
compensation or loss caused by the lawsuits.
(6) Contract disputes between Hualian Grain and Oil Company and Zhuhai Doumen Huabi Feed Factory
On December 9 2004 Hualian Grain and Oil Company signed a purchases and sales contract with Zhuhai
Doumen Huabi Feed Factory to sell 2000.00 tons of corn with payment for goods of RMB 2396300 but the
payment has not been taken back. In April 2005 Hualian Grain and Oil Company discovered that Zhuhai Doumen
Huabi Feed Factory had basically stopped production and the goods were transferred the legal representative
Liang Dongxing had fled. On July 2 2005 the public security organ arrested Liang Dongxing. Hualian Company
has prosecuted him and won in the lawsuit and the lawsuit has been settled and in enforcement.222
As of 30
th
June 2019 Hualian Grain and Oil Company had received RMB 2396300 from Zhuhai Doumen Huabi
Feed Factory Hualian Grain and Oil Company had made 100% of bad debt provision for this amount.
(7) Contract disputes between Hualian Grain and Oil Company and Foshan Huaxing Feed Factory
In August and October 2007 Hualian Grain and Oil Company sold goods to Foshan City Shunde District Huaxing
Feed Factory and received a total of RMB 2958600 of commercial acceptance bills. Due to the company’s
overdue payment Hualian Grain and Oil Company filed a lawsuit with the People’s Court of Shunde District
Foshan City on October 29 2007 requesting Foshan City Shunde District Huaxing Feed Factory to repay the
payment for goods and pay the corresponding interests. From June to July 2011 totally took back the company’s
bankruptcy property settlement of RMB 1638900. As of 30
th
June 2019 Hualian Grain and Oil Company had
receivables of RMB 1319700 from Foshan City Shunde District Huaxing Feed Factory and it had made 100% of
bad debt provision for this amount.
(8) Contract disputes on the international sales transactions of soybeans between Shenzhen Cereals Group and
Noble Resources Pte. Ltd
On March 3 2004 Shenzhen Cereals Group and Noble Resources Pte. Ltd. (hereinafter referred to as Noble
Company) signed a contract stipulating that Shenzhen Cereals Group Co. Ltd. would purchase 55000 tons of
Argentine or Brazilian soybeans from Noble Company under CFR conditions.
On May 10 2004 the General Administration of Quality Supervision Inspection and Quarantine (AQSIQ) issued
a notice that a shipload of Brazilian soybeans exported to Xiamen China by Noble Company in April 2004 was
found to be mixed with seed-coating soybeans thus Noble Company was suspended to export Brazilian soybeans
to China.
On June 25 2004 after the cargo ship arrived in Qingdao Port the cargo was inspected by Qingdao Commodity
Inspection and Quarantine Bureau who found the cargo contained seed-coating soybeans and the cargo was
sealed up according to law.On July 22 2004 the two parties signed a supplementary agreement on the above-mentioned soybean sales
contract stipulating that the demurrage incurred as the cargo could not be unloaded due to seed-coating soybeans
shall be borne by Noble Company and agreed that the disputes under the contract shall be governed by Chinese
courts according to Chinese law.223
In July 2004 Noble Company submitted the case to the Hong Kong International Arbitration Center for
arbitration requesting Shenzhen Cereals Group Co. Ltd. to undertake cargo ship detainment Hong Kong
demurrage loss contingencies and so on totaling seven claims. Shenzhen Cereals Group Co. Ltd. filed a
jurisdictional objection the Hong Kong International Arbitration Center ruled on December 14 2006 that two
claims have the right of jurisdiction i.e. demurrage of Noble ship in Hong Kong and loss contingencies other
claims were rejected.The Hong Kong International Arbitration Center ruled on 17 Feb. 2011 that: the demurrage of $ 2173000.00
should be paid by Shenzhen Cereals Group and the interest counted by annual interest rate of 5.00% since 4
th
June 2004. In July 2011 Noble Company applied to Shenzhen Intermediate People’s Court for enforcement of the
ruling. On 30 March 2015 a civil order ([2017] Shen Zhong Fa Min Chu Zi No. 270) was made by Shenzhen
Intermediate People’s Court ruling that the demurrage charges arising from the failure of normal unloading of the
goods involved shall be borne by Nobel Company as stipulated in the Supplementary Agreement of the Soybean
Sales Contract signed by both parties the disputes under the contractual agreements shall be settled by Chinese
Laws and shall be under the jurisdiction of Chinese courts. The Hong Kong International Arbitration Center has
no jurisdiction over this case than the application for execution of Nobel Company was rejected.
On February 6 2018 Noble Company applied to the Hong Kong High Court for enforcement of the Hong Kong
International Arbitration Center's ruling on February 17 2011. On February 18 2019 the Hong Kong High Court
ruled that the enforcement time limit for the application of Noble Company has been lost. On September 3 2014
Noble Company submitted the “Application for Further Claims Arbitration” to the Hong Kong International
Arbitration Center requesting Shenzhen Cereals Group Co. Ltd. to pay Noble Company US$7.45 million in
compensation for the freighter’s lessor - Bunge Limited and the corresponding litigation and arbitration fee.However Noble Company had never applied for litigation matters such as court hearings. On November 1 2016
the arbitrator of Hong Kong International Arbitration Center wrote to Noble Company requesting it to initiate the
arbitration at the end of 2016 otherwise the arbitral tribunal will take measures to close the case but so far Noble
Company has not initiated the arbitration.
The application for arbitration of the second part of the ruling of Hong Kong International Arbitration Center
made by Noble Company in the mainland has been rejected the application for enforcement in Hong Kong was
ruled that the time limit of application for arbitration has been exceeded. Related procedures of the third part of
the arbitration has not been initiated in accordance with the requirements of the arbitral tribunal therefore it can
be presumed that the case has been closed.
According to the “Commitment Letter of Shenzhen Fude State-owned Capital Operation Co. Ltd. on the PendingLitigation of Shenzhen Cereals Group Co. Ltd.” If Shenzhen Cereals Group Co. Ltd. and its holding subsidiaries
suffer any claims compensation losses or expenses due to the contract dispute of international sale of soybean
with Noble Resources Co. Ltd. Shenzhen Fude State-owned Capital Operation Co. Ltd. will assume the
compensation or loss caused by the lawsuit.224
(9) Contract disputes between Shenzhen Cereals Group and Beijing Zhongwang Food Co. Ltd.
On August 22 2007 Beijing Zhongwang Food Co. Ltd. defaulted on the payment for goods of RMB
1911200.00 to Shenzhen Cereals Group. Beijing Zhongwang Food Co. Ltd. was in bankruptcy proceedings
Shenzhen Cereals Group has reported claims and interests of RMB 2473400 to the bankruptcy administrator and
the confirmed ordinary creditor’s rights are RMB 2128300. It is estimated that the bankruptcy property
repayment amount is about RMB 50000 at most.
On April 22 2018 Shenzhen Cereals Group received a bankruptcy liquidation of RMB 37313.42 and up to 30
th
June 2019 the bad debt provision for residual claims are accrual by Shenzhen Cereals Group in total as RMB
1873886.58.
2. Contingency arising from the provision of external debt guarantee and their impacts on financial
The guarantee for related parties found more in the Note XII. Related party and related transaction
Ended as 30th June 2019 the Company has no guarantees provided for non-related parties
3. Except for the above mentioned contingency up to 30
th
June 2019 the Company has no other major
contingency that should be disclosed
(2) If the Company has no important contingency need to disclosed explain reasons
The Company has no important contingency that need to disclose.
3. Other
XV. Events after balance sheet date
1. Important non adjustment matters
RMB/CNY
Item Content
Impact on financial status and
operation results
Reasons of fails to estimate the
impact
2. Profit distribution
RMB/CNY
225
3. Sales return
4. Other events after balance sheet date
Up to the date of the financial report released the Company has no other events after balance sheet date need to released
XVI. Other important events
1. Previous accounting errors collection
(1)Retrospective restatement
RMB/CNY
Content Treatment procedure
Items impact during vary
comparative period
Accumulated impact
(2)Prospective application
Content Approval procedure Reasons
2. Debt restructuring
3. Assets exchange
(1) Exchange of non-monetary assets
(2)Other assets exchange
4. Pension plan
According to the “Enterprise Annuity Scheme of Shenzhen Cereals Group Co. Ltd.” and the employees’
application the Company pays the enterprise annuity for the employees who meet the conditions for participation
according to the proportion agreed by the Confirmation for Enterprise Payment Ratio of the Enterprise Annuity of
Shenzhen Cereals Group Co. Ltd. the payment base is based on the total salary of the previous year and the
maximum payment rate is not more than 8.33%.
5. Discontinuing operation
RMB/CNY
Item Revenue Expenses Total profit
Income tax
expenses
Net profit
Profit of
discontinuing
operation
226
attributable to
owners of parent
company
Other explanation
6. Segment
(1) Recognition basis and accounting policy for reportable segment
(2) Financial information for reportable segment
RMB/CNY
Item Offset between segment Total
(3) The Company has no segment or unable to disclose total assets and liability of the segment explain
reasons
(4) Other explanation
7. Other major transaction and events makes influence on investor’s decision
8. Other
XVII. Principle notes of financial statements of parent company
1. Account receivable
(1)Category
RMB/CNY
Category
Ending balance Opening balance
Book balance Bad debt provision
Book
value
Book balance Bad debt provision
Book value
Amount Ratio Amount
Accrual
ratio
Amount Ratio Amount
Accrual
ratio
Account receivable
with bad debt
provision accrual on
a single basis
28453.0
8
0.60%
28453.0
8
100.00% 0.00 28453.08 0.07% 28453.08 100.00% 0.00
Including:
Account receivable
with single minor
amount but with bad
28453.0
8
0.60%
28453.0
8
100.00% 0.00 28453.08 0.07% 28453.08 100.00% 0.00
227
debts provision
accrued on a single
basis
Account receivable
with bad debt
provision accrual on
portfolio
472050
0.44
100.00%
19717.6
1
0.42%
4700782
.83
4286995
4.13
99.93%
428835.0
6
1.00%
42441119.
07
Including:
Age portfolio
458252
8.24
97.08%
19717.6
1
0.42%
4562810
.63
4286995
4.13
99.93%
428835.0
6
1.00%
42441119.
07
Related party and
petty cash
137972.
20
2.92%
137972.2
0
Total
474895
3.52
100.00%
48170.6
9
1.01%
4700782
.83
4289840
7.21
100.00%
457288.1
4
1.07%
42441119.
07
Bad debt provision accrual on single basis:
RMB/CNY
Name
Ending balance
Book balance Bad debt provision Accrual ratio Accrual causes
Bad debt provision accrual on portfolio: 48170.69 Yuan
RMB/CNY
Name
Ending balance
Book balance Bad debt provision Accrual ratio
Aging analysis 4582528.24 19717.61 0.43%
Related party and petty cash 137972.20 0.00 0.00%
Account receivable with single
minor amount but with bad
debts provision accrued on a
single basis
28453.08
28453.08
100%
Total
4748953.52
48170.69
--
Explanation on portfolio determines:
Bad debt provision accrual on portfolio:
RMB/CNY
Name
Ending balance
Book balance Bad debt provision Accrual ratio
Explanation on portfolio determines:
228
If the provision for bad debts of account receivable is made in accordance with the general model of expected credit losses please refer
to the disclosure of other account receivable to disclose related information about bad-debt provisions:
□ Applicable √Not applicable
By account age
RMB/CNY
Account age Ending balance
Within one year(one year included) 4712012.82
Within one year(one year included) 4712012.82
1-2 years 1383.22
2-3 years 3117.40
Over 3 years 32440.08
3-4 years 3987.00
Over 5 years 28453.08
Total
4748953.52
(2) Bad debt provision accrual collected or reversal in the period
Bad debt provision accrual in the period:
RMB/CNY
Category Opening balance
Amount changed in the period
Ending balance
Accrual Collected or reversal Written-off
Age portfolio 428835.06
409117.45
19717.61
Other account
receivable with
single minor amount
but with bad debt
provision accrual on
single basis
28453.08
28453.08
Total 457288.14
409117.45
48170.69
Including major amount bad debt provision that collected or reversal in the period:
RMB/CNY
Enterprise Amount collected or reversal Collection way
229
(3) Account receivable actually written-off in the period
RMB/CNY
Item Amount written-off
Including major account receivable written-off
RMB/CNY
Enterprise Nature Amount written-off Written-off causes
Procedure of
written-off
Resulted by related
transaction (Y/N)
Explanation on account receivable written-off
(4) Top 5 account receivables at ending balance by arrears party
Total period-end balance of top five receivables by arrears party amounting to 4542912.44 Yuan takes 95.66 percent of the total
account receivable at period-end bad debt provision accrual correspondingly at year-end amounting as 45951.02 Yuan.
(5) Account receivable derecognition due to financial assets transfer
(6) Assets and liabilities resulted by account receivable transfer and continues involvement
Other explanation:
2. Other account receivable
RMB/CNY
Item Ending balance Opening balance
Other account receivable 242873517.60 159677969.59
Total 242873517.60 159677969.59
(1) Interest receivable
1)Category
RMB/CNY
Item Ending balance Opening balance
2) Important overdue interest
Borrower Ending balance Overdue time Overdue causes
Whether impairment
occurs and its judgment
basis
Other explanation:
3) Accrual of bad debt provision
□ Applicable √Not applicable
230
(2) Dividend receivable
1) Category
RMB/CNY
Item (or invested enterprise) Ending balance Opening balance
2) Important dividend receivable with account age over one year
RMB/CNY
Item (or invested
enterprise)
Ending balance Account age
Reasons for not
collection
Whether impairment
occurs and its judgment
basis
3) Accrual of bad debt provision
□ Applicable √Not applicable
Other explanation:
(3) Other account receivable
1) By nature
RMB/CNY
Nature Ending book balance Opening book balance
Margin and deposit 1235229.39 119089.00
Export tax rebate 171917.78 312364.06
Intercourse funds and other 264704763.86 182280569.20
Total 266111911.03 182712022.26
2) Accrual of bad debt provision
RMB/CNY
Bad debt provision
Phase I Phase II Phase III
Total
Expected credit
losses over next 12
months
Expected credit losses for
the entire duration (without
credit impairment occurred)
Expected credit losses for
the entire duration (with
credit impairment occurred)
Balance on Jan. 1 2019 1922.73 75499.40 22956630.54 23034052.67
Balance of Jan. 1 2019
in the period
—— —— —— ——
Current accrual 204763.49 204763.49
Current reversal 422.73 422.73
Balance on Jun. 30 2019 1500.00 75499.40 23161394.03 23238393.43
Change of book balance of loss provision with amount has major changes in the period
□ Applicable √Not applicable
By account age
231
RMB/CNY
Account age Ending balance
Within one year(one year included) 209256830.79
Within one year(one year included) 209256830.79
1-2 years 7483918.42
2-3 years 18812851.47
Over 3 years 30558310.35
3-4 years 6875000.00
4-5 years 6218962.15
Over 5 years 17464348.20
Total 266111911.03
3) Bad debt provision accrual collected or reversal in the period
Bad debt provision accrual in the period:
RMB/CNY
Category Opening balance
Amount changed in the period
Ending balance
Accrual Collected or reversal
Age portfolio 77422.13 422.73 76999.40
Other account receivable
with single minor amount
but with bad debt
provision accrual on
single basis
5641249.52 5641249.52
Other account receivable
with single major amount
and with bad debt
provision accrual on
single basis
17315381.02 204763.49 17520144.51
Total 23034052.67 204763.49 422.73 23238393.43
Including major amount with bad debt provision reverse or collected in the period:
RMB/CNY
Enterprise Amount reversal or collected Collection way
4) Other account receivable actually written-off in the period
RMB/CNY
Item Amount written-off
Including important other account receivable written-off
RMB/CNY
Enterprise Nature Amount written-off Written-off causes Procedure of Resulted by related
232
written-off transaction (Y/N)
Explanation on other account receivable written-off
5) Top 5 other receivables at ending balance by arrears party
RMB/CNY
Enterprise Nature Ending balance Account age
Ratio in total ending
balance of other
account receivables
Ending balance of
bad debt reserve
Huizhou Shenbao
Technology Co. Ltd
Intercourse funds 112351493.44 Within one year 42.22%
Shenzhen Cereals
Group Co. Ltd
Intercourse funds 83019048.50 Within one year 31.20%
Shenzhen Shenbao
Sanjing Food &
Beverage
Development Co. Ltd
Intercourse funds 26205575.88 Over 5 years 9.85%
Changzhou Shenbao
Chacang Company
Intercourse funds
19988710.83
1-3 years 7.51% 17520144.50
Shenzhen Shenbao
Technology Center
Co. Ltd
Intercourse funds 12628225.82 Over 5 years 4.75%
Total --
254193054.47
-- 95.52% 17520144.50
6) Other account receivables related to government grants
RMB/CNY
Enterprise Government grants Ending balance Ending account age
Time amount and basis
for collection predicted
7) Other receivable for termination of confirmation due to the transfer of financial assets
8) The amount of assets and liabilities that are transferred other receivable and continued to be involved
Other explanation:
3. Long-term equity investment
RMB/CNY
Item
Ending balance Opening balance
Book balance
Impairment
provision
Book value Book balance
Impairment
provision
Book value
Investment for
subsidiary
4208728337.66 4208728337.66 4208728337.66 4208728337.66
Investment for 6618320.35 2927628.53 3690691.82 6753354.23 2927628.53 3825725.70
233
associates and
joint venture
Total 4215346658.01 2927628.53 4212419029.48 4215481691.89 2927628.53 4212554063.36
(1) Investment for subsidiary
RMB/CNY
The invested entity Opening balance Current increased
Current
decreased
Ending balance
Current accrual
Impairment
provision
Ending balance of
impairment
provision
Shenbao Property 2550000.00 2550000.00
Shenbao Industrial
& Trading
5500000.00 5500000.00
Shenbao Sanjing 80520842.36 80520842.36
Shenbao
Huacheng
168551781.80 168551781.80
Huizhou Shenbao
Technology
60000000.00 60000000.00
Wuyuan Ju Fang
Yong
280404134.35 280404134.35
Hangzhou Ju Fang
Yong
176906952.42 176906952.42
Shenbao
Technology Center
54676764.11 54676764.11
Shenshenbao
Investment
50000000.00 50000000.00
Yunnan Supply
Chain
20000000.00 20000000.00
Pu’er Tea Trading
Center
18202825.80 18202825.80
SZCG 3291415036.82 3291415036.82
Total 4208728337.66 4208728337.66
(2) Investment for associates and joint venture
RMB/CNY
investmen
t
company
Opening
balance
Current changes (+-)
Ending
balance
Ending
balance
of
Additiona
l
Capital
reduction
Investme
nt gains
Other
comprehe
Other
equity
Cash
dividend
Accrual
of
Other
234
investmen
t
recognize
d under
equity
nsive
income
adjustmen
t
change or profit
announce
d to
issued
impairme
nt
provision
impairme
nt
provision
I. Joint venture
II. Associated enterprise
Shenzhen
Shenbao
(Liaoyuan
)
Industrial
Company
0.00 0.00 57628.53
Shenzhen
Shenbao
(Xinmin)
Foods
Co. Ltd
0.00 0.00
2870000
.00
Changzho
u
Shenbao
Chacang
Guangzho
u
Shenbao
Mendao
Tea Co.Ltd.
3825725
.70
-135033.
88
3690691
.82
0.00
Subtotal
3825725
.70
-135033.
88
3690691
.82
2927628
.53
Total
3825725
.70
-135033.
88
3690691
.82
2927628
.53
(3) Other explanation
4. Operating income and operating cost
RMB/CNY
Item
Current Period Last Period
Income Cost Income Cost
Main business 31562730.23 29829293.00 67228720.81 63731294.22
Total 31562730.23 29829293.00 67228720.81 63731294.22
235
Whether implemented the new revenue standards
□Yes √No
Other explanation:
5. Investment income
RMB/CNY
Item Current Period Last Period
Long-term equity investment income
measured by equity
-135033.88 -185480.37
Income from financial products 1567648.80
Total 1432614.92 -185480.37
6. Other
XVIII. Supplementary information
1. Current non-recurring gains/losses
√ Applicable □Not applicable
RMB/CNY
Item Amount Note
Gains/losses from the disposal of
non-current asset
-4184.59
Governmental grants calculated into current
gains and losses(while closely related with
the normal business of the Company
excluding the fixed-amount or
fixed-proportion governmental subsidy
according to the unified national standard)
5463876.60
Profit and loss of assets delegation on others’
investment or management
3627466.27
Except for the effective hedging business
related to the normal business of the
Company the fair value changes from
holding the tradable financial assets
derivative financial assets tradable
financial liability and derivative financial
liability; and investment income from
disposal of tradable financial assets
derivative financial assets tradable financial
28381.21
236
liability and other creditors investment
Switch back of the impairment provision
for account receivable with impairment test
on single basis and contract assets
412500.00
Other non-operating income and expense
other than the above mentioned ones
-3619767.49
Less: Impact on income tax 702095.88
Impact on minority interests 232425.56
Total 4973750.56 --
Concerning the extraordinary profit (gain)/loss defined by Q&A Announcement No.1 on Information Disclosure for Companies
Offering Their Securities to the Public --- Extraordinary Profit/loss and the items defined as recurring profit (gain)/loss according to
the lists of extraordinary profit (gain)/loss in Q&A Announcement No.1 on Information Disclosure for Companies Offering Their
Securities to the Public --- Extraordinary Profit/loss explain reasons
□ Applicable √Not applicable
2. ROE and earnings per share
Profits during report period Weighted average ROE
Earnings per share
Basic EPS (Yuan/share)
Diluted EPS
(Yuan/share)
Net profits belong to common stock
stockholders of the Company
4.82% 0.1763 0.1763
Net profits belong to common stock
stockholders of the Company after
deducting nonrecurring gains and
losses
4.70% 0.1720 0.1720
3. Difference of the accounting data under accounting rules in and out of China
(1) Difference of the net profit and net assets disclosed in financial report under both IAS (International
Accounting Standards) and Chinese GAAP (Generally Accepted Accounting Principles)
√ Applicable □Not applicable
RMB/CNY
Net profit Net assets
Current Period Last Period Ending balance Opening balance
Chinese GAAP 203168850.61 202779343.34 4260480115.67 4172502535.11
Items and amount adjusted by IAS:
Adjustment for other
payable fund of stock
1067000.00 1067000.00
237
market regulation
IAS 203168850.61 202779343.34 4261547115.67 4173569535.11
(2) Difference of the net profit and net assets disclosed in financial report under both foreign accounting
rules and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable √Not applicable
(3) Explanation on data differences under the accounting standards in and out of China; as for the
differences adjustment audited by foreign auditing institute listed name of the institute
4. Other
238
Section XI. Documents available for Reference
1. Text of financial statement with signature and seals of legal person person in charge of accounting works and
person in charge of accounting institution;
2. Original and official copies of all documents which have been disclosed on Securities Times China Securities
Journal and Hong Kong Commercial Daily in the report period;
3. Original copies of 2019 Semi-Annual Report with signature of the Chairman.
SHENZHEN CEREALS HOLDINGS CO.LTD
Chairman: Zhu Junming
23
rd
August 2019
沪公网安备31011802005267号
