SHENZHEN SPECIAL ECONOMIC ZONE REAL ESTATE &

PROPERTIES (GROUP) CO. LTD.

INTERIM REPORT 2020

August 2020

2

Part I Important Notes Table of Contents and Definitions

The Board of Directors (or the “Board”) the Supervisory Committee as well as the directors

supervisors and senior management of ShenZhen Special Economic Zone Real Estate &

Properties (Group) Co. Ltd. (hereinafter referred to as the “Company”) hereby guarantee the

factuality accuracy and completeness of the contents of this Report and its summary and

shall be jointly and severally liable for any misrepresentations misleading statements or

material omissions therein.Liu Zhengyu chairman of the Company’s Board Tang Xiaoping the Company’s head for

financial affairs and Qiao Yanjun head of the Company’s financial department (equivalent to

financial manager) hereby guarantee that the Financial Statements carried in this Report are

factual accurate and complete.

All the Company’s directors have attended the Board meeting for the review of this Report

and its summary.

Certain descriptions about the Company’s operating plans or work arrangements for the

future mentioned in this Report and its summary the implementation of which is subject to

various factors shall NOT be considered as promises to investors. Therefore investors are

reminded to exercise caution when making investment decisions.The Company is subject to the Guideline No. 3 of the Shenzhen Stock Exchange on

Information Disclosure by Industry—for Listed Companies Engaging in Real Estate.Risks facing the Company have been explained in detail in “X Risks Facing the Company and

Countermeasures” in “Part IV Operating Performance Discussion and Analysis” herein.The Company has no interim dividend plan either in the form of cash or stock.This Report and its summary have been prepared in both Chinese and English. Should there

be any discrepancies or misunderstandings between the two versions the Chinese versions

shall prevail.Table of Contents

Part I Important Notes Table of Contents and Definitions ........................................................... 2

Part II Corporate Information and Key Financial Information ................................................... 5

Part III Business Summary ............................................................................................................... 8

Part IV Operating Performance Discussion and Analysis ........................................................... 10

Part V Significant Events ................................................................................................................ 25

Part VI Share Changes and Shareholder Information ................................................................. 33

Part VII Preferred Shares ............................................................................................................... 38

Part VIII Convertible Corporate Bonds ........................................................................................ 39

Part IX Directors Supervisors and Senior Management ............................................................. 40

Part X Corporate Bonds .................................................................................................................. 41

Part XI Financial Statements .......................................................................................................... 42

Part XII Documents Available for Reference .............................................................................. 200

Definitions

Term Definition

“SPG” the “Company” the “Group” or “we”

ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd.and its consolidated subsidiaries except where the context otherwise requires

Holding Company Shenzhen Investment Holdings Co. Ltd.Part II Corporate Information and Key Financial Information

I Corporate Information

Stock name SPG SPG-B Stock code 000029 200029

Stock exchange for stock

listing

Shenzhen Stock Exchange

Company name in Chinese 深圳经济特区房地产(集团)股份有限公司

Abbr. (if any) 深房集团

Company name in English (if

any)

ShenZhen Special Economic Zone Real Estate&Properties (Group).co.，Ltd．

Abbr. (if any) SPG

Legal representative Liu Zhengyu

II Contact Information

Board Secretary Securities Representative

Name Tang Xiaoping Luo Yi

Address

47/F SPG Plaza Renmin South Road

Shenzhen Guangdong P.R.China

47/F SPG Plaza Renmin South Road

Shenzhen Guangdong P.R.China

Tel. （86 755）82293000-4638 （86 755）82293000-4715

Fax （86 755）82294024 （86 755）82294024

Email address tangxiaoping0086@126.com spg@163.net

III Other Information

1. Contact Information of the Company

Indicate by tick mark whether any change occurred to the registered address office address and their zip codes website address and

email address of the Company in the Reporting Period.

□ Applicable √ Not applicable

No change occurred to the said information in the Reporting Period which can be found in the 2019 Annual Report.

2. Media for Information Disclosure and Place where this Report is Kept

Indicate by tick mark whether any change occurred to the information disclosure media and the place for keeping the Company’s

periodic reports in the Reporting Period.

□ Applicable √ Not applicable

The newspapers designated by the Company for information disclosure the website designated by the CSRC for disclosing the

Company’s periodic reports and the place for keeping such reports did not change in the Reporting Period. The said information can

be found in the 2019 Annual Report.IV Key Financial Information

Indicate by tick mark whether there is any retrospectively restated datum in the table below.□ Yes √ No

H1 2020 H1 2019 Change (%)

Operating revenue (RMB) 596258495.40 1251337802.57 -52.35%

Net profit attributable to the listed

company’s shareholders (RMB)

97274985.72 333155843.41 -70.80%

Net profit attributable to the listed

company’s shareholders before exceptional

gains and losses (RMB)

85184270.99 322865954.53 -73.62%

Net cash generated from/used in operating

activities (RMB)

-212242798.59 685675245.10 -130.95%

Basic earnings per share (RMB/share) 0.0962 0.3293 -70.79%

Diluted earnings per share (RMB/share) 0.0962 0.3293 -70.79%

Weighted average return on equity (%) 2.68% 9.81% -7.13%

30 June 2020 31 December 2019 Change (%)

Total assets (RMB) 4485810299.86 4909669536.09 -8.63%

Equity attributable to the listed company’s

shareholders (RMB)

3597595143.65 3666874569.99 -1.89%

V Accounting Data Differences under Chinese Accounting Standards (CAS) and

International Financial Reporting Standards (IFRS) and Foreign Accounting Standards

1. Net Profit and Equity Differences under CAS and IFRS

√ Applicable □ Not applicable

Unit: RMB

Net profit attributable to the listed company’s

shareholders

Equity attributable to the listed company’s

shareholders

H1 2020 H1 2019 Ending amount Beginning amount

Under CAS 97274985.72 333155843.41 3597595143.65 3666874569.99

Adjusted as per IFRS

Under IFRS 97274985.72 333155843.41 3597595143.65 3666874569.99

2. Net Profit and Equity Differences under CAS and Foreign Accounting Standards

□ Applicable √ Not applicable

No such differences for the Reporting Period.

3. Reasons for Accounting Data Differences Above

□ Applicable √ Not applicable

XI Exceptional Gains and Losses

√ Applicable □ Not applicable

Unit: RMB

Item Reporting Period Note

Gain or loss on disposal of non-current assets (inclusive of

impairment allowance write-offs)

-19011.53

Government subsidies charged to current profit or loss (exclusive

of government subsidies given in the Company’s ordinary course

of business at fixed quotas or amounts as per the government’s

uniform standards)

2792616.39

Pandemic-related government

subsidy

Gain or loss on assets entrusted to other entities for investment or

management

15217058.60

Gains on investments in

structured deposits at bank

Non-operating income and expense other than the above -1369710.49

Anti-pandemic donation expenses -500000.00

Less: Income tax effects 4030238.24

Total 12090714.73 --

Explanation of why the Company classifies a gain/loss item as exceptional according to the definition in the Explanatory

Announcement No. 1 on Information Disclosure for Companies Offering Their Securities to the Public—Exceptional Gain/Loss

Items or reclassifies any exceptional item listed in the said explanatory announcement as recurrent:

□ Applicable √ Not applicable

No such cases for the Reporting Period.Part III Business Summary

I Principal Activity of the Company in the Reporting Period

The Company primarily develops and sells residential properties in two cities Shenzhen and

Shantou. In Shenzhen the Chuanqi Donghu Mingyuan project completed the filing for completed

construction in December 2019 and has started the hand-over and move-in process which is

cumulatively around 60% sold; and regarding the Cuilinyuan project residential units have been

sold out and the sale of commercial/retail portion is underway. In Shantou the Tianyuewan Phase I

project is around 60% sold cumulatively; and the Tianyuewan Phase II project has been topped out.II Significant Changes in Major Assets

1. Significant Changes in Major Assets

Major assets Main reason for significant changes

Equity assets No significant change

Fixed assets No significant change

Intangible assets No significant change

Construction in progress No significant change

Accounts payable

The ending amount was down by RMB79913337.00 (or 32.72%) from the beginning

amount primarily driven by the payments made for construction.

Advances from customers

The ending amount was down by RMB151366151.23 (or 94.91%) from the beginning

amount primarily driven by the reclassification to contract liabilities.Taxes payable

The ending amount was down by RMB378466874.92 (or 64.62%) from the beginning

amount primarily driven by the payment of land VAT.

2. Major Assets Overseas

□ Applicable √ Not applicable

III Core Competitiveness Analysis

As one of the earliest real estate listed companies in Shenzhen the Company has a history over 40

years in real estate development in Shenzhen and rich experience in the main business of real estate

development. In recent years thanks to the experience learned from the Shenzhen-located

Chuanqishan project Chuanqi Shanglin project Chuanqi Jingyuan project and Chuanqi Donghu

Mingyuan project as well as from the Shantou-located projects the Company accelerates the

establishment of a modern enterprise HR management system and works hard in building a

professional and high-quality development team. It also keeps improving the management

mechanism and processes for project development. As a result the professionalism and

management capability of the Company have improved significantly; planning construction cost

control marketing capability and brand image have been effectively enhanced; and the operational

capability in the main business of real estate keeps increasing along with the core competitiveness.

As of the Reporting Period (inclusive) the Company has been honored jointly by the Guangdong

Provincial Enterprise Confederation and the Guangdong Provincial Association of Entrepreneurs as

a “Most Honest Enterprise in Guangdong Province” for eight years in a row. It has also wonaccolades from the Shenzhen Real Estate Association namely the “Real Estate Developer inShenzhen with the Highest Brand Value” for the past two years.Part IV Operating Performance Discussion and Analysis

I Overview

For the first half of 2020 the Company recorded operating revenue of RMB596 million down

52.35% year-on-year; a profit before tax of RMB141 million down 68.40% year-on-year; and a net

profit attributable to the listed company’s shareholders of RMB97 million down 70.80%

year-on-year. As at 30 June 2020 total assets stood at RMB4486 million down 8.63% from the

beginning amount; total liabilities stood at RMB1030 million down 25.63% from the beginning

amount; and the debt/asset ratio was 22.96% down by 5.25 percentage points from the beginning

ratio.Since its abrupt occurrence at the beginning of 2020 COVID-19 has continued to spread

throughout the whole world dragging global economy into the most severe recession since the

Great Depression. The central government has stepped up effort in regular epidemic prevention and

control and promoted the resumption of work and production on all fronts. In the first quarter with

the substantial decline in domestic consumption and investment the economy faced greater

downward pressure; in the second quarter the real estate market operation exhibited a momentumof recovery. In terms of policy the country has continued the orientation that “Houses are for livingin not for speculating on” and implemented real estate policies appropriate to local situation

leading to an obvious trend of differentiation between urban regions.

Facing the complicated and tough macro-economic environment and the fierce market competition

the Company’s operation team has braved the challenges and implemented policies in a targeted

way. They have balanced between the epidemic prevention and control and business development

and tightened effort in all work in a bid to counter the negative impact brought by COVID-19. In

general the Company has carried out its work orderly in all aspects including the development of

main businesses operations management assets restructuring Party building epidemic prevention

and control and production safety.(I) Highlights in Main Business Development

1. Property sales reached the target. To weaken the negative impact of COVID-19 on property sales

the Company carried out promotion and developed customers through multiple channels including

placing equal focus on online and offline promotion. During the Reporting Period the Company

outperformed the target for new contract-based sales laying a solid foundation for the

accomplishment for the target of the whole year.

2. Projects were advanced steadily. As at the end of the Reporting Period landscaping of Chuanqi

Donghu Mingyuan in Shenzhen was improved and handed over and the construction and

installation for the residence gate were completed; main works of Shantou Tianyuewan were

completed and landscaping of the mountain park was completed.(II) Stable Operations Management with Improvement

1. Financial management was regulated and effective. While ensuring the satisfaction of need for

working capital the Company fully increased the efficiency of idle fund. It strengthened

communication with its cooperating banks to withdraw the fund from property sales. In early May

the Company successfully executed the cash dividends for 2019. During the Reporting Period the

Company gained an income of more than RMB20 million from wealth management including

structured deposits and agreement-based deposits with banks.

2. Property leasing moved ahead under pressure. Under the double impact of COVID-19 and

economic downturn situations such as cancellation of leasing and reduction of leasing size have

been frequent. Focusing on customers’ needs the Company made every effort to retain existing

customers and develop new customers in a bid to expand business while maintaining the base.

3. Breakthroughs were made in problems carried over from the past. During the Reporting Period

the Company sped up the collection of overdue payment in lawsuits involving overdue rentals and

management fees and won the lawsuits with executable judgement.

4. Solid achievements were made in cost control. By firmly sticking to a full-cost whole-process

and penetrating management concept in production and operation the Company continued to

strengthen project cost control with satisfying results achieved.(III) Continuous Advancement of Assets Restructuring

During the Reporting Period the Company remained in share trading suspension due to major

assets restructuring. It continued to proactively work on fundamental matters including due

diligence for restructuring additional audit additional evaluation and the updating of restructuring

related material and information. The Company disclosed the progress of those matters strictly in

accordance with regulations and went through the procedures for share trading suspension and

resumption. It continued to keep in touch with all restructuring related parties and strengthened

communication with regulatory authorities. In addition it answered calls from investors patiently

and attentively and replied to their questions on irm.cninfo.com.cn winning their understanding

and support.(IV) Realistic and Pragmatic Approach for Party Building

The Company persisted in synchronous research arrangement and advancement for its efforts in

Party building and business. It gave full play to the leading role of the Party committee in

controlling the direction managing the overall situation and ensuring implementation. The

Company attached great importance to the Party’s political theory learning and education and

ensured regular and policy-based learning in the Theory Center Group of its Party committee. All

its Party committee and branches strictly implemented the “Three Meeting One Lesson” System

and the “Five-One” Project for Party members’ education promoted Xi Jinping Thought on

Socialism with Chinese Characteristics for a New Era into the Company’s front line and

consolidated the results of themed education. The Company continued to improve the

accountability for the development of honest and non-corruptible practice. It established a list of

key tasks for such development strengthened the “Two responsibility” and continuously enforced

full and strict discipline over its Party members.(V) Marked Achievements in Epidemic Prevention and Control

During the Reporting Period there was no cluster infection among the Group’s more than 1900

employees over 30 residences operated and managed by its property management subsidiary and

thousands of office workers at SPG Plaza. Additionally the Company proactively fulfilled its social

responsibilities as a state-owned enterprise. During the Reporting Period it cut and exempted

property rentals of more than RMB10 million and donated RMB500000 for the epidemic

prevention and control in Hubei.(VI) Stable and Orderly Safe Production

The Company upheld the safety concept in its entire production process implemented the

accountability system for production safety and strengthened the roles in production safety. It kept

a tight grip on the identification and management of safety hazards persisted in zero tolerance on

safety hazards and reinforced its defense line for production safety. Through a combination of

measures the Company conducted training to promote safety knowledge to its employees as a

tangible step to strengthen the safety awareness among all its staff. It continued to organize

emergency drills on a regular basis to improve its emergency management capability in all aspects.

During the Reporting Period the Company’s project construction and the production situations of

its subsidiaries were stable and orderly without any major safety accident.The Company is subject to the Guideline No. 3 of the Shenzhen Stock Exchange on Information Disclosure by Industry—for Listed

Companies Engaging in Real Estate.

Currently China is gradually getting rid of the negative impact brought by COVID-19. While its

economic operation takes on a momentum of growth towards recovery the future situation remains

complicated and tough with great instability and uncertainties. The Company will actively adapt to

the macro economic development trend and stick to the concept of pursuing progress while

ensuring stability and of seeking continuous development. It will continue to focus on the goal of

building a competitive and professional real estate enterprise and speed up the development and

construction of existing land and projects. It will prudently look for new investment opportunities

and seek a path of high quality development in the context of complicated and changeable external

environment and intense market competition.New additions to the land bank:

Name of land

lot or project

Location

Planned use

of land

Site area（㎡）

Floor area

with plot

ratio （㎡）

How the land

is obtained

The

Company’s

interest

Total land

price

(RMB’0000)

Consideratio

n of the

Company’s

interest

(RMB’0000)

Cumulative land bank:

Name of project/area Site area（0000 ㎡） Floor area（0000 ㎡）

Floor area available for

development（0000 ㎡）

Xinfeng Building in Shantou 0.59 2.67 2.67

Total 0.59 2.67 2.67

Development status of major projects:

City/reg

ion

Name of

project

Locatio

n

Status

The

Compan

y’s

interest

Time

for

commen

cement

of

construc

tion

%

develop

ed

%

construc

ted

Site area

（㎡）

Planned

floor

area

with

plot

ratio

（㎡）

Floor

area

complet

ed in the

Current

Period

（㎡）

Cumulat

ively

complet

ed floor

area

（㎡）

Expecte

d total

investm

ent

(RMB’0

000)

Cumulat

ive

investm

ent

(RMB’0

000)

Shenzhe

n

Chuanqi

Donghu

Mingyu

an

Luohu

District

Constru

ction

complet

ed on 18

Decemb

er 2019

100.00

%

1

Februar

y 2016

100%

100.00

%

5890 45256 45256 45256 51000 41602

Shantou

Tianyue

wan

Phase II

Chaoya

ng

District

Framew

ork in

construc

tion

100.00

%

1

October

2018

80% 80.00% 31168 153470 0 0 65485 40241

Sales status of major projects:

City/regi

on

Name of

project

Location Status

The

Compan

y’s

interest

Floor

area with

plot ratio

（㎡）

Floor

area

available

for sale

（㎡）

Cumulati

vely

pre-sold/

sold

floor

area

（㎡）

Floor

area

pre-sold/

sold in

the

Current

Period

（㎡）

Pre-sale/

sales

revenue

generate

in the

Current

Period

(RMB’0

000)

Cumulati

vely

settled

floor

area (㎡)

Floor

area

settled in

the

Current

Period

（㎡）

Pre-sale/

sales

revenue

settled in

the

Current

Period

(RMB’0

000)

Shenzhe

n

Chuanqi

Donghu

Mingyua

n

Luohu

District

Ready

for sale

100.00% 45256 32857 18575 10885 71529 8220 3450 21160

Shenzhe

n

Cuilinyu

an

Longgan

g District

Ready

for sale

100.00% 60111 56137 51507 813 2843 48427 7302 9147

Shantou

Tianyue

wan

Phase I

Chaoyan

g District

Ready

for sale

100.00% 153470 151594 82268 13070 7179 66668 13715 7558

Rental status of major projects:

Name of project Location Use

The Company’s

interest

Rentable area

（㎡）

Cumulative

rented area （㎡）

Average

occupancy rate

Real Estate

Mansion

Shenzhen Commercial

100.00% 3413.88 3413.88 100.00%

North Block of

Guoshang

Mansion

Shenzhen Commercial

100.00% 4819.71 4819.71 100.00%

Petrel Building Shenzhen Commercial 100.00% 22475.47 22475.47 100.00%

SPG Plaza Shenzhen Office building 100.00% 59462.52 37633.20 63.29%

SPG Plaza

Podium

Shenzhen Commercial

100.00% 21449.72 10327.14 48.00%

Wenjin Garden Shenzhen Commercial 100.00% 3531.60 3531.60 100.00%

Primary land development:

√ Applicable □ Not applicable

Name

of

project

Locatio

n

The

Compa

ny’s

interest

Expecte

d total

investm

ent

(RMB’

0000)

Cumula

tive

investm

ent

(RMB’

0000)

Area of

land

planned

to be

formed

（㎡）

Area of

land

cumulat

ively

formed

（㎡）

Area of

land

formed

in the

Current

Period

（㎡）

Cumula

tively

sold

floor

area

（㎡）

Floor

area

sold in

the

Current

Period

（㎡）

Cumula

tively

settled

land

area

（㎡）

Land

area

settled

in the

Current

Period

（㎡）

Cumula

tive

revenue

from

primary

land

develop

ment

(RMB’

0000)

Revenu

e from

primary

land

develop

ment in

the

Current

Period

(RMB’

0000)

Revenu

e

collecte

d

(RMB’

0000)

Financing channels:

Financing channel

Ending balance of

financings

Financing cost

range/average

financing cost

Maturity structure

Within 1 year 1-2 years 2-3 years Over 3 years

Development strategy and operating plan for the coming year:

Centering around the goal for 2020 the Company will set the tone of “improving operationsadvancing restructuring ensuring safety and strengthening Party building” and make every effort in

the following four aspects.(I) Achieving Business Stability with Focus on Business

The Company will focus on project sales and ensure the accomplishment of its annual sales target.It will make full effort to guarantee the quality and progress of its project construction and develop

projects with fine quality. It will closely follow the land market updates and strive to develop new

land or make breakthroughs in project development within the year. In terms of property leasing

the Company will endeavor to reach the year’s leasing target by all possible means. Its subsidiaries

should drive the resumption of work and production in a steady pace and strive towards the annual

targets.(II) Ensuring Orderly Progress of Key Work through Rational Coordination

The Company will keep close watch on the trends of capital market and regulatory policies and

strengthen communication with regulatory authorities. It will perform its obligation of information

disclosure properly handle its investor relations and drive the restructuring process together with

all parties of the major assets restructuring according to regulations. The Company will continue to

improve the allocation of human resources strengthen its staff team building optimize the age

structure and knowledge structure of its talent team and maintain the strength and execution of the

team. It will work on the formulation of its “14th Five-Year” strategic plan as a blueprint for the

new journey of the next five-year plan. It will make solid steps to ensure the sustainability and

stability of its routine operations management and continue to enhance its management quality.(III) Implementing the Epidemic Prevention and Control and Ensuring Production Safety

through Persistent Effort

The Company will always be on full alert and implement the epidemic prevention and control with

high standards and strict requirements. It will ensure targeted and strong epidemic prevention and

control and make full effort in the battle against the virus. The Company will promote the concept

of production safety continue to improve the production safety management system and advance

the standardization of production safety and the building of the “double” prevention mechanism. It

will strengthen the accountability for production safety step up effort in the identification of safety

hazards and intensity safety management in key areas so as to prevent production safety accident

and create favorable conditions for the accomplishment of the year’s business target.(IV) Strengthening the Development of Honest and Non-corruptible Practice Led by Party

Building

The Company will further study and implement Xi Jinping Thought on Socialism with Chinese

Characteristics for a New Era and put into effect the guiding principles of the Party’s 19th National

Congress and the second and third plenary sessions of its 19th Central Committee. It will strengthen

the roles of political discipline and political rules intensify supervision discipline implementation

and accountability and extend the strict discipline over the Party to its grassroots level. The

Company will fully implement the decisions and arrangements of the superior Party committees

exert its leading role in controlling the direction managing the overall situation and ensuring

implementation as a Party committee of a state-owned enterprise and integrate Party leadership into

its corporate governance to lead itself into high quality development.Provision of guarantees for homebuyers on bank mortgages:

√ Applicable □ Not applicable

Project Guarantee period

Guarantee amou

nt (RMB’0000)

Note

Cuilinyuan Until the property ownership certificate is

registered as collateral and handed over to bank for

keeping

10273.65

Chuanqi Donghu

Mingyuan

Until the property ownership certificate is

registered as collateral and handed over to bank for

keeping

8116.93

Tianyuewan Phase I Until the property ownership certificate is

registered as collateral and handed over to bank for

18994.00

keeping

Total 37384.58

As at 30 June 2020 the guarantees provided by the Group for the mortgage loans of buyers of its residential units which is a normal

practice in the real estate industry were RMB373.8458 million in total.Joint investments by directors supervisors and senior management and the listed company (applicable for such investments where

the directors supervisors and senior management are the major source of investment):

□ Applicable √ Not applicable

II Core Business Analysis

See “I Overview” above.Year-on-year changes in key financial data:

Unit: RMB

H1 2020 H1 2019 Change (%) Main reason for change

Operating revenue

596258495.40 1251337802.57 -52.35%

Decrease in property

sales carryforwards

Cost of sales 343908087.46 437127976.25 -21.33%

Selling expense 8536448.38 18474060.33 -53.79%

Sales halt in Q1 caused

by the pandemic

Administrative expense 40253977.26 30812771.33 30.64%

Finance costs -5747585.98 -6626259.12 13.26%

Income tax expense 43599689.97 112729793.86 -61.32% Decrease in profit

Net cash generated

from/used in operating

activities

-212242798.59 685675245.10 -130.95%

Decrease in proceeds

from sale of commodities

and rendering of services

Net cash generated

from/used in investing

activities

1020263040.32 -388696596.57 362.48%

Recovery of principal

and related income of

structured deposit at bank

upon maturity in May

Net cash generated

from/used in financing

activities

-166923900.00 -204332000.00 18.31%

Payment of the 2019

final dividend

Net increase in cash and

cash equivalents

641032673.52 91958457.22 597.09%

Return on investment 15217058.60 14288098.55 6.50%

Income from structured

deposit at bank

Major changes in the profit structure or sources of the Company in the Reporting Period:

□ Applicable √ Not applicable

No such cases in the Reporting Period.

Breakdown of operating revenue:

Unit: RMB

H1 2020 H1 2019

Change (%)

Operating revenue

As % of total

operating revenue

(%)

Operating revenue

As % of total

operating revenue

(%)

Total 596258495.40 100% 1251337802.57 100% -52.35%

By business segment

Real estate 382458149.70 64.14% 983278946.94 78.58% -61.10%

Construction service 124548909.59 20.89% 149651610.68 11.96% -16.77%

Rental service 21780551.36 3.65% 32096693.65 2.56% -32.14%

Property

management service

63715063.94 10.69% 77686206.46 6.21% -17.98%

Other 3755820.81 0.63% 8624344.84 0.69% -56.45%

By product

Housing units 381862911.60 64.04% 182142033.38 14.56% 109.65%

Apartments 0.00 0.00% 795797573.30 63.60% -100.00%

Shops and parking

place

595238.10 0.10% 6456714.32 0.52% -90.78%

Other 213800345.70 35.86% 266941481.57 21.33% -19.91%

By geographic segment

Guangdong Province 546573961.29 91.67% 1142030927.15 91.26% -52.14%

Other regions in

China

49542269.40 8.31% 108983973.87 8.71% -54.54%

Overseas 142264.71 0.02% 322901.55 0.03% -55.94%

Operating division product category or operating segment contributing over 10% of operating revenue or operating profit:

√ Applicable □ Not applicable

Unit: RMB

Operating

revenue

Cost of sales

Gross profit

margin

YoY change in

operating revenue

(%)

YoY change in

cost of sales (%)

YoY change in

gross profit

margin (%)

By business segment

Real estate 382458149.70 138000861.61 63.92% -61.10% -31.22% -15.68%

Construction

service

124548909.59 122182750.01 1.90% -16.77% -15.20% -1.82%

Rental service 21780551.36 17080923.54 21.58% -32.14% 25.23% -35.93%

Property

management

63715063.94 61918257.30 2.82% -17.98% -12.88% -5.69%

service

Other 3755820.81 7648018.09 -103.63% -56.45% -0.52% -114.49%

By product

Housing units 381862911.60 137763181.19 63.92% 109.65% 63.49% 10.19%

Shops and

parking place

595238.10 237680.42 60.07% -90.78% -90.76% 60.07%

Other 213800345.70 205907225.85 3.69% -19.91% -13.34% -7.30%

By geographic segment

Guangdong

Province

546573961.29 294947142.62 46.04% -52.14% -11.27% -24.86%

Other regions in

China

49542269.40 48960944.84 1.17% -54.54% -53.25% -2.74%

Overseas 142264.71 100.00% -55.94% 0.00%

Main business data of the most recent period restated according to changed statistical caliber for the Reporting period

□ Applicable √ Not applicable

Any over 30% YoY movements in the data above and why:

√ Applicable □ Not applicable

Affected by the COVID-19 epidemic businesses of property sales rental income and hotels declined year-on-year.

III Non-Core Business Analysis

□ Applicable √ Not applicable

IV Analysis of Assets and Liabilities

1. Significant Changes in Asset Composition

Unit: RMB

End of Reporting Period

End of the same period of last

year

Increase/d

ecrease in

proportio

n

Notes to significant changes

Amount

Proportion to

total assets

Amount

Proportion to

total assets

Monetary assets

2148222433.

87

47.89%

1240480893.

15

24.47% 23.42%

Caused by expiration of bank

structured deposits

Accounts

receivable

49341432.90 1.10% 39421868.07 0.78% 0.32%

Inventories

1435950855.

23

32.01%

1602436237.

11

31.61% 0.40%

Investment 619021572.7 13.80% 611746542.66 12.07% 1.73%

property 4

Long-term equity

investments

469838.65 0.01% 12561107.24 0.25% -0.24%

Fixed assets 29086917.96 0.65% 31903409.26 0.63% 0.02%

Short-term

borrowings

45904965.19 1.02% 21334705.19 0.42% 0.60%

Long-term

borrowings

0.00% 0.00% 0.00%

Accounts payable

164311141.4

6

3.66% 244224478.46 4.97% -1.31%

Taxes payable

207233940.4

4

4.62% 585700815.36 11.93% -7.31% Caused by payment of taxes

2. Assets and Liabilities Measured at Fair Value

√ Applicable □ Not applicable

Unit: RMB

Item

Beginning

amount

Gain/loss on

fair-value

changes in the

Reporting

Period

Cumulative

fair-value

changes

charged to

equity

Impairment

allowance for

the Reporting

Period

Purchased in

the Reporting

Period

Sold in the

Reporting

Period

Other

changes

Ending

amount

Financial

assets

4.

Investments

in other

equity

instruments

33126730.04 -415909.17

32710820.

87

Total of the

above

33126730.04 -415909.17

32710820.

87

Financial

liabilities

0.00 0.00

Other change

Significant changes to the measurement attributes of the major assets in the Reporting Period:

□ Yes √ No

3. Restricted Asset Rights as at the Period-End

Item Ending carrying value Reasons

Accounts receivable 45904965.19 Pledge for short-term borrowings

Total 45904965.19 --

V Investment Analysis

1. Total Investments Made

□ Applicable √ Not applicable

2. Significant Equity Investments Made in the Reporting Period

□ Applicable √ Not applicable

3. Significant Non-equity Investments Ongoing in the Reporting Period

□ Applicable √ Not applicable

4. Financial Assets at Fair Value

□ Applicable √ Not applicable

5. Financial Investments

(1) Securities Investments

□ Applicable √ Not applicable

No such cases in this Reporting Period

(2) Investment in Derivative Financial Instruments

□ Applicable √ Not applicable

No such cases in this Reporting Period

VI Sale of Major Assets and Equity Interests

1. Sale of Major Assets

□ Applicable √ Not applicable

No such cases in this Reporting Period

2. Sale of Major Equity Interests

□ Applicable √ Not applicable

VII Principal Subsidiaries and Joint Stock Companies

√ Applicable □ Not applicable

Principal subsidiaries and joint stock companies with an over 10% effect on the Company’s net profit:

Unit: RMB

Company

name

Relationship

with the

Company

Main

business

scope

Registered

capital

Total assets Net assets

Operating

revenue

Operating

profit

Net profit

Shenzhen

SPG

Longgang

Development

Co. Ltd.

Subsidiary

Development

of real estate

30000000.0

0

405539843.

85

123463343.

01

91902660.9

5

50319673

.83

37739755.37

Shantou

SEZ Wellam

FTY

Building

Development

Co. Ltd.

Subsidiary

Development

of real estate

91226120.4

4

186989164.

26

98038844.0

4

3894630.45

1009239.

63

-2231560.52

Shantou

Huafeng Real

Estate

Development

Co. Ltd.

Subsidiary

Development

of real estate

80000000.0

0

894785023.

10

21341063.5

6

75582142.0

7

223546.51 26948.42

Great Wall

Estate Co.

Inc. (U.S.)

Subsidiary Lease 2051146.00

19124375.2

8

-87150881.

75

142264.71 114909.18 114909.18

Shenzhen

Zhentong

Engineering

Co. Ltd.

Subsidiary

Installation

and

construction

10000000.0

0

179323533.

91

24337408.6

3

125058062.

17

95637.11 51854.24

Shenzhen

Property

Management

Co. Ltd.

Subsidiary

Property

management

7250000.00

96184885.7

3

29594171.0

3

65456729.6

6

398666.02 1575210.74

Shenzhen

Petrel Hotel

Co. Ltd.

Subsidiary Hotel Service

30000000.0

0

49206430.0

9

41842103.4

7

4787492.29

-4805255.

51

-4378988.31

Shenzhen

Huazhan

Construction

Subsidiary

Construction

supervision

8000000.00 9812000.10 9397408.54 1244103.06 -24889.40 -14889.40

Supervision

Co. Ltd.

Xin Feng

Enterprise

Co. Ltd.

Subsidiary

Investment

and

management

502335.00

125117088.

62

-468942718

.41

2273925.21

-2576791.

40

-2795409.82

Subsidiaries obtained or disposed in the Reporting Period:

□ Applicable √ Not applicable

Information about principal subsidiaries and joint stock companies:

1. Except the Company the subordinate subsidiaries engaged in real estate development mainly

include: Shenzhen SPG Longgang Development Co. Ltd. Shantou SEZ Wellam FTY Building

Development Co. Ltd. Shantou Huafeng Real Estate Development Co. Ltd. The Cuilinyuan

project developed by Shenzhen SPG Longgang Development Co. Ltd. brought forward RMB91.47

million in H1 of 2020 with an accumulated sales rate of 92% accounting for 24% of the Company's

real estate sector income and 15% of the Group's combined profits. Jinyedao and YuejingDongfang

developed by Shantou SEZ Wellam FTY Building Development Co. Ltd. were sold as remaining

buildings with relatively small percentages of sales volume and carry-over amount. And Shantou

Huafeng Real Estate Development Co. Ltd. was responsible for the development of Tianyuewan

project (divided into Phase I and Phase II). Tianyuewan Phase I was opened for sale in October

2016 and Phase II started construction in November 2018. The accumulated sales rate of the Phase

I as of now is 60%.

2. Shenzhen Zhentong Engineering Co. Ltd. was engaged in the business of building installation

and maintenance with the operating revenues of RMB125.06 million for H1 of 2020 and of 21% to

the operating revenues of the Company with a YoY decrease of 16.80%.

3. Shenzhen Property Management Co. Ltd was engaged in the industry of property management.

The operating revenues were of RMB65.46 million for H1 of 2020 that was of 11% to the operating

revenues of the Company with a YoY decrease of 18.69%.

4. Shenzhen Petrel Hotel Co. Ltd. was engaged in hotel and rental business which was relatively

affected most by the COVID-19 epidemic. The operating revenues were of RMB4.79 million for

H1 of 2020 with a YoY decrease of 63.32%.

VIII Structured Bodies Controlled by the Company

□ Applicable √ Not applicable

IX Operating Performance Forecast for January-September 2020

Warning of a forecast negative net profit for the January-September period of the current year or a considerable YoY change therein

as well as the reasons:

√ Applicable □ Not applicable

Forecast of operating results: the net profit is positive with a YoY decrease over 50%

Type of forecast data: Interval data

January-December 2020 January-Dece Change

mber 2019

Equity attributable to

shareholders of the listed

company (RMB’0000)

16000 -- 22000 43952 Down -63.60% -- -49.95%

Basic earnings per share

(RMB /share)

0.1582 -- 0.2175 0.4344 Down -63.59% -- -49.94%

Note The sales carryforwards of the Company’s real estate decreased year on year.X Risks Facing the Company and Countermeasures

(1) Risks Facing the Company:

1. Risks from macroeconomic environment. In 2020 the economic development of China faces

unprecedented difficulties and challenges. Although we have achieved remarkable fruits in the

prevention and control of COVID-19 epidemic the recovery of domestic economy is still under

high pressure due to the spread of overseas epidemic and increasing uncertainty generated from

global and regional political friction and conflict.

2. Risks from policy on real estate industry. The Chinese government adheres to the principle that

“Houses are for living in not for speculating on” adheres not to take the real estate as a shore-termmeasure for stimulating economy and adheres to the target of “stabilizing land prices housingprices and expectations”. Each region implements policies based on its actual situation and adopts

differentiated accurate control. The real estate markets of some regions still face new challenges.

3. Potential risks from assets restructuring. The major assets restructuring of the Company is a

significant and unprecedented event with complex trading structure for involved in the Shenzhen

State-owned Enterprise Reform and with large-scale assets since the underlying assets it plans to

purchase are industrial leading assets. Thus the trading of its shares has been suspended for almost

four years. At present all matters in restructuring are steadily pushed forward. For the uncertainty

of related events investors are reminded of the investment risks.

4. Risks from sustainable development. The Company does not increase its land reserve in recent

years influenced by the major assets restructuring and the land reserve at present is limited. The

Company faces major challenges in operation and development of main business.

5. Operating risks from COVID-19 epidemic. The COVID-19 epidemic has brought impacts to the

Company’s main business and affiliates to some extent putting pressure on the annual operating

income and performance targets.

2. Countermeasures

1. The Company will unremittingly pay attention to international and domestic macroeconomic

situation and the industrial trend and then formulate flexible coping strategies.

2. The Company will further strengthen its ability to develop main business raise its management

level and make efforts to reinforce the marketing of projects so as to stabilize the fundamental of

the Company.

3. The Company will enhance the communication with regulators together with parties involved in

the restructuring and make full efforts to promote the process of major assets restructuring.

4. The Company will increase its land reserve timely and in an appropriate way to maintain the

sustainable development of the Company in the future.5. The Company will do well in the safety in project construction rental property and workplace

and will properly reduce the influence of the epidemic on production and operation so as to create

good conditions for achieving the annual business goals.Part V Significant Events

I. Annual and Extraordinary General Meeting Convened during the Reporting Period

1. General Meeting Convened during the Reporting Period

Meeting Type

Investor

participation ratio

Convened date Disclosure date

Index to disclosed

information

The 1st Extraordinary

General Meeting of

2020

Extraordinary

General Meeting

63.59% 15 January 2020 16 January 2020

Resolutions of the 1st

Extraordinary

General Meeting of

2020 disclosed on

www.cninfo.com.cn

The 2019 Annual

General Meeting

Annual General

Meeting

63.60% 29 April 2020 30 April 2020

Resolutions of 2019

Annual General

Meeting disclosed

on

www.cninfo.com.cn

The 2nd

Extraordinary

General Meeting of

2020

Extraordinary

General Meeting

63.59% 30 June 2020 1 July 2020

Resolutions of the

2nd Extraordinary

General Meeting of

2020 disclosed on

www.cninfo.com.cn

2. Extraordinary General Meeting Convened at Request of Preference Shareholders with Resumed Voting

Rights

□ Applicable √ Not applicable

II. Interim Dividend Plan for the Reporting Period

□ Applicable √ Not applicable

The Company has no interim dividend plan.III. Commitments of the Company’s Actual Controller Shareholders Related Parties and

Acquirer as well as the Company and Other Commitment Makers Fulfilled in the Reporting

Period or still Ongoing at Period-End

□ Applicable √ Not applicable

No such cases in the Reporting Period.IV. Engagement and Disengagement of CPAs Firm

Has the interim financial report been audited?

□Yes √ No

This interim Report is unaudited.

V. Explanations Given by Board of Directors and Supervisory Committee Regarding

“Modified Auditor’s Report” Issued by CPAs Firm for the Reporting Period

□ Applicable √ Not applicable

VI. Explanations Given by Board of Directors Regarding “Modified Auditor’s Report” Issued

for Last Year

□ Applicable √ Not applicable

VII. Bankruptcy and Restructuring

□ Applicable √ Not applicable

No such cases in the Reporting Period.VIII. Legal Matters

Significant lawsuits or arbitrations:

□ Applicable √ Not applicable

No such cases in the Reporting Period.Other legal matters:

√Applicable □ Not applicable

Lawsuit/arbitration

Amount

involved

(RMB’0000)

Estimated

liabilities or not

Progress

Decision and

influence

Execution of

decision

Disclosure

date

Index to

disclosed

information

Xi’an Project

Lawsuit

2100 No In execution

① Business

Tourism

Company had to

pay for the

compensation

RMB36.62

million and the

relevant interest

(from 14

September 1998

to the payment

day) to Xi’an

The applicant

has received

RMB15.20

million. Now

Business

Tourism

Company has

no executable

properties and

Xi’an Joint

Commission on

Commerce has

14 March

2020

Annual

Report 2019

(full text) on

www.cninfo.c

om.cn

Fresh Peak

Company within

one month after

the judgment

entering into

force. If the

Business Tourism

Company failed

to pay in time it

had to pay double

debt interests to

Xi’an Fresh Peak

Company for the

overdue period;

② Xi’an Joint

Commission on

Commerce had

jointly and

severally

obligation of the

interests of the

compensation; .③

Business Tourism

Company shall

bear

RMB227500 of

the acceptance fee

and the security

fee.been refusing to

execute the

ruling. It is

difficult to

recover the rest.IX. Media Query

□ Applicable √ Not applicable

No such cases in the Reporting Period.X. Punishments and Rectifications

□ Applicable √ Not applicable

No such cases in the Reporting Period.XI. Credit Conditions of the Company as well as its Controlling Shareholder and Actual

Controller

□ Applicable √ Not applicable

XII. Equity Incentive Plans Employee Stock Ownership Plans or Other Incentive Measures

for Employees

□ Applicable √ Not applicable

No such cases in the Reporting Period.XIII. Major Related-Party Transactions

1. Continuing Related-Party Transactions

□ Applicable √ Not applicable

No such cases in the Reporting Period.

2. Related-Party Transactions Regarding Purchase or Sales of Assets or Equity Interests

□ Applicable √ Not applicable

No such cases in the Reporting Period.

3. Related Transactions Regarding Joint Investments in Third Parties

□ Applicable √ Not applicable

No such cases in the Reporting Period.

4. Credits and Liabilities with Related Parties

□ Applicable √ Not applicable

No such cases in the Reporting Period.

5. Other Major Related-Party Transactions

□ Applicable √ Not applicable

No such cases in the Reporting Period.XIV. Particulars about the Non-operating Occupation of Funds by the Controlling

Shareholder and Other Related Parties of the Company

□ Applicable √ Not applicable

No such cases in the Reporting Period.XV. Major Contracts and Execution thereof

1. Entrustment Contracting and Leases

(1) Entrustment

□ Applicable √ Not applicable

No such cases in the Reporting Period.

(2) Contracting

□ Applicable √ Not applicable

No such cases in the Reporting Period.

(3) Leases

□ Applicable √ Not applicable

No such cases in the Reporting Period.

2. Significant Guarantees

□ Applicable √ Not applicable

No such cases in the Reporting Period.

3. Wealth Management Entrustment

√Applicable □Not applicable

Unit: RMB'0000

Type of wealth

management

Funding source Principal

Outstanding amount

before maturity

Overdue amount

Bank financial products Self-funded 100000 0 0

Total 100000 0 0

Particulars of cash entrusted for wealth management with single significant amount or low security bad liquidity and no capital

preservation

□Applicable √ Not applicable

Wealth management entrustments with possible impairments including an expectedly unrecoverable principal:

□Applicable √ Not applicable

4. Other Significant Contracts

□ Applicable √ Not applicable

No such cases in the Reporting Period.XVI. Social Responsibilities

1. Significant Environment Protection

Indicate by tick mark whether the Company or any of its subsidiaries is a heavily polluting business identified by the environmental

protection authorities of China

No

The Company and its subsidiaries isn’t a heavily polluting business identified by the environmental protection authorities of China.

2. Targeted Measures Taken to Help People Lift Themselves Out of Poverty

(1) Plan for Targeted Measures

(2) Outline of Targeted Measures in the Reporting Period

(3) Effects of Targeted Measures

Indicator

Measurement

unit

Number/Progress

I. General condition —— ——

II. Itemized investment —— ——

1. Out of poverty by industrial development —— ——

2. Out of poverty by transferring employment —— ——

3. Out of poverty by relocating —— ——

4. Out of poverty by education —— ——

5. Out of poverty by improving health —— ——

6. Out of poverty by protecting ecological environment —— ——

7. Subsidy for the poorest —— ——

8. Social poverty alleviation —— ——

9. Other items —— ——

III. Received awards(contents and rank) —— ——

(4) Subsequent Targeted Measure Plans

XVII. Other Significant Events

□ Applicable √ Not applicable

Since the controlling shareholder of the Company is planning a significant event that involves the

Company upon the application to the Shenzhen Stock Exchange trading in the stocks of the

Company (A-stock under the name of “SPG A” and the symbol of “000029”; B-stock under the

name of “SPG B” and the symbol of “200029”) was suspended starting from the opening of 14

September 2016. The Company disclosed the Announcement on Share Trading Suspension due to

Planning of Significant Event (No. 2016-022) the Announcement on Continued Share Trading

Suspension due to Planning of Significant Event (No. 2016-023) and the Announcement on

Continued Share Trading Suspension due to Planning of Significant Event (No. 2016-024) on 14

September 2016 22 September 2016 and 29 September 2016 respectively. Upon ascertainment the

event constituted a material asset restructuring. The Company disclosed the Announcement on

Share Trading Suspension due to Planning of Major Assets Restructuring (No. 2016-025) on 30

September 2016 and the Announcement on Signing Cooperation Agreement on Restructuring and

Listing (No. 2016-027) on 10 October 2016.The Company convened the 33

rd

Meeting of the 7

th

Board of the Directors on 11 November 2016

which the Proposal on Continued Share Trading Suspension due to Planning of Major Assets

Restructuring was reviewed and approved. For details see the Announcement on Continued Share

Trading Suspension after Expiration of Period of Share Trading Suspension due to Planning of

Major Assets Restructuring (No. 2016-039) disclosed on 14 November 2016.The Company convened the 1

st

Extraordinary General Meeting of 2016 on 12 December 2016 on

which the Proposal on Continued Share Trading Suspension due to Planning of Major Assets

Restructuring was reviewed and approved. For details see the Announcement on Application for

Continued Share Trading Suspension after Expiration of Period of Share Trading Suspension due

to Planning of Major Assets Restructuring (No. 2016-047) disclosed on 13 December 2016.The Company held an online illustration meeting to investors on 10 March 2017 communicating

this major assets restructuring with them and answering questions that they were generally

concerned about with the information allowed to be disclosed. For details see the Announcement on

Online Illustration Meeting to Investors (No. 2017-012) disclosed on 11 March 2017.

On 14 December 2019 the Company disclosed the Announcement on Signing the Supplementary

Agreement VI of the Cooperation Agreement governing Restructuring and Listing (No. 2019-090)

which extends the exclusivity period and validity period stipulated in the restructuring cooperation

agreement to 31 December 2020.To ensure the smooth progress of this major assets restructuring prevent abnormal fluctuations in the

prices of its stocks and protect the rights and interests of its non-controlling interests the Company

has applied to the Shenzhen Stock Exchange for continued share trading suspension for no more than

1 month as of 14 August 2020 and expects to disclose the major assets restructuring plan or report

according to the requirements of the Standards for the Contents and Formats of Information

Disclosure by Companies Offering Securities to the Public No. 26-Major Assets Restructuring of

Listed Companies prior to 14 December 2020. For details see the Announcement on Delay of Share

Trading Resumption of Planning of Major Assets Restructuring (No. 2020-061) disclosed on 14

August 2020.

During the share trading suspension period the Company shall disclose the progress of this major

assets restructuring at least every five trading days in strict accordance with the requirements of

applicable laws and regulations. At present this major assets restructuring is proceeding smoothly.This major assets restructuring is subject to great uncertainty. Therefore investors are kindly

reminded to pay attention to possible investment risk.XVIII. Significant Events of Subsidiaries

□ Applicable √ Not applicable

Part VI Share Changes and Shareholder Information

I. Share Changes

1. Share Changes

Unit: share

Before the change Increase/decrease (+/-) After the change

Shares

Percentag

e (%)

New

issues

Shares as

dividend

converted

from

profit

Shares as

dividend

converted

from

capital

reserves

Other Subtotal Shares

Percentag

e (%)

1. Restricted shares 0 0.00% 0 0 0 0 0 0 0.00%

1.1 Shares held by the state 0 0.00% 0 0 0 0 0 0 0.00%

1.2 Shares held by

state-own legal person

0 0.00% 0 0 0 0 0 0 0.00%

1.3 Shares held by other

domestic investors

0 0.00% 0 0 0 0 0 0 0.00%

Among which: shares held

by domestic legal person

0 0.00% 0 0 0 0 0 0.00%

Shares held by domestic

natural person

0 0.00% 0 0 0 0 0 0 0.00%

1.4 Oversea shareholdings 0 0.00% 0 0 0 0 0 0 0.00%

Among which: shares held

by oversea legal person

0 0.00% 0 0 0 0 0 0 0.00%

Shares held by oversea

natural person

0 0.00% 0 0 0 0 0 0 0.00%

2. Unrestricted shares

1011660

000

100.00% 0 0 0 0 0

1011660

000

100.00%

2.1 RMB ordinary shares

8916600

00

88.14% 0 0 0 0 0

8916600

00

88.14%

2.2 Domestically listed

foreign shares

1200000

00

11.86% 0 0 0 0 0

1200000

00

11.86%

2.3 Oversea listed foreign

shares

0 0.00% 0 0 0 0 0 0 0.00%

2.4 Other 0 0.00% 0 0 0 0 0 0 0.00%

3. Total shares

1011660

000

100.00% 0 0 0 0 0

1011660

000

100.00%

Reasons for share changes:

□ Applicable √ Not applicable

Approval of share changes:

□ Applicable √ Not applicable

Transfer of share ownership:

□ Applicable √ Not applicable

Progress on any share repurchase:

□ Applicable √ Not applicable

Progress on reducing the repurchased shares by means of centralized bidding:

□ Applicable √ Not applicable

Effects of share changes on the basic and diluted earnings per share equity per share attributable to the Company’s ordinary

shareholders and other financial indicators of the prior year and the prior accounting period respectively:

□ Applicable √ Not applicable

Other information that the Company considers necessary or is required by the securities regulator to be disclosed:

□ Applicable √ Not applicable

2. Changes in Restricted Shares

□ Applicable √ Not applicable

II. Issuance and Listing of Securities

□ Applicable √ Not applicable

III. Total Number of Shareholders and Their Shareholdings

Unit: share

Total number of ordinary

shareholders at the period-end

76442

Total number of preference

shareholders with resumed

voting rights at the period-end

(if any) (see Note 8)

0

Shareholding of ordinary shareholders holding more than 5% shares or the top 10 of ordinary shareholders

Name of

shareholder

Nature of

shareholder

Holding

percentage

(%)

Number

of

shareholdi

Increase

and

decrease of

Number

of shares

held

Number of

shares held

subject to

Pledged or frozen shares

Status of Amount

ng at the

end of the

Reporting

Period

shares

during

Reporting

Period

subject to

trading

moratoriu

m

trading

moratorium

shares

Shenzhen

Investment

Holdings Co.Ltd.State-owned legal

person

63.55%

6428842

62

64288426

2

Shandong Gold

Financial

Holding Capital

Management

Co. Ltd. －

Shandong Gold

Financial

Holding

Sustaining Fund

1

Domestic

non-state-owned

legal person

1.02%

1030000

0

10300000

Lu Zhigao

Domestic natural

person

0.32% 3246949 3246949

Tan Shiqing

Domestic natural

person

0.13% 1286701 1286701

Yang Shuilian

Domestic natural

person

0.13% 1273700 1273700

Yang Jianxiong

Domestic natural

person

0.12% 1255750 1255750

Central Huijin

Asset

Management

Co. Ltd.

State-owned legal

person

0.12% 1165500 1165500

Peng Wei

Domestic natural

person

0.11% 1129082 1129082

Wu Haoyuan

Foreign natural

person

0.11% 1109300 1109300

Guotai Junan

Securities

(Hong Kong)

Limited

Foreign legal

person

0.10% 1015683 1015683

Strategic investor or general legal

person becoming a top-10 ordinary

shareholder due to rights issue (if

None

any) (see Note 3)

Related or acting-in-concert parties

among the shareholders above

The Company has found no related parties or acting-in-concert parties as defined in the

Administrative Measures for Shareholding Changes in Listed Companies among the

shareholders above.Top 10 unrestricted shareholders

Name of shareholder Unrestricted shares held at the period-end

Shares by type

Type Shares

Shenzhen Investment Holdings Co.Ltd.

642884262

RMB ordinary

shares

642884262

Shandong Gold Financial Holding

Capital Management Co. Ltd. －

Shandong Gold Financial Holding

Sustaining Fund 1

10300000

RMB ordinary

shares

10300000

Lu Zhigao 3246949

RMB ordinary

shares

3246949

Tan Shiqing 1286701

RMB ordinary

shares

1286701

Yang Shuilian 1273700

RMB ordinary

shares

1273700

Yang Jianxiong 1255750

Domestically

listed foreign

share

1255750

Central Huijin Asset Management

Co. Ltd.

1165500

RMB ordinary

shares

1165500

Peng Wei 1129082

RMB ordinary

shares

1129082

Wu Haoyuan 1109300

Domestically

listed foreign

share

1109300

Guotai Junan Securities (Hong

Kong) Limited

1015683

Domestically

listed foreign

share

1015683

Related or acting-in-concert parties

among top 10 unrestricted public

shareholders as well as between top

10 unrestricted public shareholders

and top 10 shareholders

The Company has found no related parties or acting-in-concert parties as defined in the

Administrative Measures for Shareholding Changes in Listed Companies among the

shareholders above.Top 10 ordinary shareholders

involved in securities margin

The fourth shareholder holds all his shares in the Company in his accounts of collateral

securities for margin trading. And the third shareholder holds some of his shares in the

trading (if any) (see Note 4) Company in such accounts.Indicate by tick mark whether any of the top 10 ordinary shareholders or the top 10 unrestricted ordinary shareholders of the

Company conducted any promissory repo during the Reporting Period.

□ Yea √ No

No such cases in the Reporting Period.IV. Change of the Controlling Shareholder or the Actual Controller

Change of the controlling shareholder in the Reporting Period

□ Applicable √ Not applicable

There was no any change of the controlling shareholder of the Company in the Reporting Period.

Change of the actual controller in the Reporting Period

□ Applicable √ Not applicable

There was no any change of the actual controller of the Company in the Reporting Period.Part VII Preferred Shares

□ Applicable √ Not applicable

No preferred shares in the Reporting Period.Part VIII Convertible Bonds

□ Applicable √ Not applicable

No convertible bonds in the Reporting Period.Part IX Directors Supervisors Senior Management and Staff

I. Changes in Shareholdings of Directors Supervisors and Senior Management

□ Applicable √ Not applicable

No such cases in the Reporting Period. For details see Annual Report 2019.II. Changes in Directors Supervisors and Senior Management

√Applicable □ Not applicable

Name Office title Type of change Date of change Reason for change

Liu Zhengyu

Chairman of the

Board

Elected 15 January 2020

Dai Xianhua

Chairman of the

Supervisory

Board

Elected 15 January 2020

Zhou Jianguo

Chairman of the

Board

Left 15 January 2020 Retired

Zhuang Quan

Chairman of the

Supervisory

Board

Left 15 January 2020 Retired

Chen Maozheng Director Left 30 June 2020 Job changed

Chen Maozheng General manager Left 30 June 2020 Job changed

Song Botong

Independent

director

Leave office 30 June 2020 Expiration of the term

Zhang Shunwen

Independent

director

Leave office 30 June 2020 Expiration of the term

He Zuowen

Independent

director

Elected 30 June 2020

Mi Xuming

Independent

director

Elected 30 June 2020

Zhang Hongwei Vice GM Employed 15 July 2020

Part X Corporate Bonds

Are there any corporate bonds publicly offered and listed on the stock exchange which were undue before the approval date of this

Report or were due but could not be redeemed in full?

No

Part XI Financial Statements

I. Auditor’s Report

Whether the semi-annual report has been audited?

□ Yes √ No

The semi-annual report of the Company has not been audited.II. Financial Statements

The financial statements of the Company have been prepared in RMB.

1. Consolidated Balance Sheet

Prepared by Shenzhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd

As at June 30 2020

Expressed in RMB

Item June 30 2020 December 31 2019

Current assets:

Cash at bank and on hand 2148222433.87 2511140445.35

Provision of Settlement fund

Funds lent

Financial assets at fair value through

profit or loss

Derivative financial assets

Notes receivable

Accounts receivable 49341432.90 62059055.68

Accounts receivable financing

Prepayments 3655533.53 219948.17

Insurance premiums receivables

Cession premiums receivables

Provision of cession premiums

receivables

Other receivables 21907433.48 28275228.26

Including: Interest receivable

Dividends receivable 1052192.76 1052192.76

Recoursable Financial assets acquired

Inventories 1435950855.23 1462229048.18

Contractual assets

Assets held for sale

Non-current assets due within one year

Other current assets 106201417.52 102781855.48

Total current assets 3765279106.53 4166705581.12

Non-current assets:

Loans and payments

Investments in debt obligations

Investments in other debt obligations

Long-term receivables

Long-term equity investments 469838.65 469838.65

Investments in other equity

instruments

32710820.87 33126730.04

Other non-current financial assets

Investment property 619021572.74 632241900.20

Fixed assets 29086917.96 30522035.11

Construction in progress

Productive living assets

Oil and gas assets

Use rights assets

Intangible assets

Development costs

Goodwill

Long-term prepaid expense 128119.84 162125.72

Deferred tax assets 39113923.27 46441325.25

Other non-current assets

Total non-current assets 720531193.33 742963954.97

Total assets 4485810299.86 4909669536.09

Current liabilities:

Short-term loans 45904965.19 51647260.17

Borrowings from central bank

Deposit funds

Financial liabilities at fair value through

profit or loss

Derivative financial liabilities

Notes payable

Accounts payable 164311141.46 244224478.46

Advances from customers 8116359.20 159482510.43

Contractual liabilities 278989120.12

Funds from sale of financial assets

with repurchasement agreements

Deposits from customer and

interbank

Funds received as an agent of stock

exchange

Funds received as stock underwrite

Payroll payable 55807291.16 53909576.49

Taxes payable 207233940.44 585700815.36

Other payables 261098346.11 277319174.53

Including: Interest payable 16535277.94 16535277.94

Dividends payable

Handling charges and commissions

payable

Cession premiums payables

Liabilities held for sale

Non-current liabilities due within one year

Other current liabilities

Total current liabilities 1021461163.68 1372283815.44

Non-current liabilities:

Provision for insurance contracts

Long-term loans

Debentures payable

Including: Preferred shares

Perpetual bonds

Lease liabilities

Long-term payables 8274256.86 7499192.92

Long-term employee benefits payable

Provisions

Deferred income

Deferred tax liabilities 4903293.58

Other non-current liabilities

Total non-current liabilities 8274256.86 12402486.50

Total liabilities 1029735420.54 1384686301.94

Shareholders' equity:

Share capital 1011660000.00 1011660000.00

Other equity instruments

Including: Preferred shares

Perpetual bonds

Capital reserves 978244910.11 978244910.11

Less: treasury shares

Other comprehensive income 21200492.07 20831004.13

Specific reserve

Surplus reserves 191222838.94 191222838.94

General reserve

Retained earnings 1395266902.53 1464915816.81

Total equity attributable to shareholders of

the Company

3597595143.65 3666874569.99

Non-controlling interests -141520264.33 -141891335.84

Total shareholders' equity 3456074879.32 3524983234.15

Total liabilities and shareholders' equity 4485810299.86 4909669536.09

Legal representative: Liu Zhengyu The person in charge of accounting affairs:

Tang Xiaoping The head of the accounting department: Qiao Yanjun

2. the Company Balance Sheet

Expressed in RMB

Item June 30 2020 December 31 2019

Current assets:

Cash at bank and on hand 1812862695.88 1967688122.55

Financial assets at fair value

through profit or loss

Derivative financial assets

Notes receivable

Accounts receivable 282853.61 156935.84

Accounts receivable financing

Prepayments 200000.00 200000.00

Other receivables 1122154158.12 835275498.69

Including: Interest

receivable

Dividends receivable

Inventories 368448151.37 419453091.86

Contractual assets

Assets held for sale

Non-current assets due within

one year

Other current assets 403864.57 407560.64

Total current assets 3304351723.55 3223181209.58

Non-current assets:

Investments in debt obligations

Investments in other debt

obligations

Long-term receivables

Long-term equity investments 150676516.92 150676516.92

Investments in other equity

instruments

13549874.72 13229501.03

Other non-current financial

assets

Investment property 510592141.91 522038731.16

Fixed assets 18363599.71 19586720.47

Construction in progress

Productive living assets

Oil and gas assets

Use rights assets

Intangible assets

Development costs

Goodwill

Long-term prepaid expense

Deferred tax assets 110159.90 162125.72

Other non-current assets 20975294.54 20975294.54

Total non-current assets 714267587.70 726668889.84

Total assets 4018619311.25 3949850099.42

Current liabilities:

Short-term loans

Financial liabilities at fair

value through profit or loss

Derivative financial liabilities

Notes payable

Accounts payable 95664957.60 103915931.14

Advances from customers 59409454.38

Contractual liabilities 177754233.70

Payroll payable 33640904.52 25544403.23

Taxes payable 195127048.11 143434273.95

Other payables 178640738.31 190666487.82

Including: Interest payable 16535277.94 16535277.94

Dividends payable

Liabilities held for sale

Non-current liabilities due

within one year

Other current liabilities

Total current liabilities 680827882.24 522970550.52

Non-current liabilities:

Long-term loans

Debentures payable

Including: Preferred shares

Perpetual bonds

Lease liabilities

Long-term payables

Long-term employee benefits

payable

Provisions

Deferred income

Deferred tax liabilities 1295046.51 1295046.51

Other non-current liabilities

Total non-current liabilities 1295046.51 1295046.51

Total liabilities 682122928.75 524265597.03

Shareholders' equity:

Share capital 1011660000.00 1011660000.00

Other equity instruments

Including: Preferred shares

Perpetual bonds

Capital reserves 964711931.13 964711931.13

Less: Treasury shares

Other comprehensive income 1242499.46 922125.77

Specific reserve

Surplus reserves 168093225.53 168093225.53

Retained earnings 1190788726.38 1280197219.96

Total owners’ equity 3336496382.50 3425584502.39

Total liabilities and shareholders’

equity

4018619311.25 3949850099.42

3. Consolidated Income Statement

Expressed in RMB

Item Jan to June 2020 Jan to June 2019

1. Revenue 596258495.40 1251337802.57

Including: Operating revenue 596258495.40 1251337802.57

Interest income

Insurance premium

income

Handling charge and

commission income

2. Overall Cost 472559039.99 820118047.65

Including: operating costs 343908087.46 437127976.25

Interest expense

Handling charge and

commission expense

Refund of Insurance

premium

Net payment for

insurance claims

Net provision for

insurance contracts

Commissions on

insurance polices

Cession charges

Taxes and surcharges 85608112.87 340329498.86

Selling and distribution

expenses

8536448.38 18474060.33

General and

administrative expenses

40253977.26 30812771.33

Research and

development expenses

Financial expenses -5747585.98 -6626259.12

Including: Interest

expense

38742.51

Interest

income

5932973.60 7623553.05

Add: Other income 557379.14

Investment income ("-" for

losses)

15217058.60 14288098.55

Including: Income from

investment in associates and joint

ventures ("-" for losses)

Income from the

derecognition of financial assets at

amortized cost (“-” for loss)

Foreign exchange gain (“-”

for loss)

Net gain on exposure

hedges (“-” for loss)

Gains from changes in fair

value ("-" for losses)

Credit impairment loss (“-”

for loss)

Impairment losses ("-" for

losses)

534500.00

Gains from assets disposal

("-" for losses)

3. Operating profit (“-” for loss) 140008393.15 445507853.47

Add: Non-operating income 2902033.77 363709.11

Less: Non-operating expense 2001278.48 3755.82

4. Profit before income tax ("-" for

losses)

140909148.44 445867806.76

Less: Income tax expense 43599689.97 112729793.86

5. Net profit for the year ("-" for net

losses))

97309458.47 333138012.90

5.1 Classification according to

operation continuity

5.1.1 Net profit from continuing

operations ("-" for net loss)

97309458.47 333138012.90

5.1.2Net profit from

discontinued operations ("-" for net

loss)

5.2 Classification according to

attribute

5.2.1 Shareholders of the

company ("-" for net loss)

97274985.72 333155843.41

5.2.1 Non-controlling interests

("-" for net loss)

34472.75 -17830.51

6. Other comprehensive income net

of tax

706086.70 121770.51

Other comprehensive income (net

of tax) attributable to shareholders of

the company

369487.94 85239.36

6.1 Items that will not be

reclassified to profit or loss

-415909.17

6.1.1 Remeasurement of

defined benefit plan liability or asset

6.1.2Share of other

comprehensive income of the equity

method investments

6.1.3 Changes in the fair

value of investments in other equity

instruments

-415909.17

6.1.4 Changes in the fair

value of the company’s credit risks

6.1.5 Other

6.2 Items that may be

reclassified to profit or loss

785397.11 85239.36

6.2.1 Share of other

comprehensive income of the equity

method investments

6.2.2 Changes in the fair

value of investments in other debt

obligations

6.2.3 Other

comprehensive income arising from

the reclassification of financial assets

6.2.4 Allowance for

credit impairments in investments in

other debt obligations

6.2.5 Effective portion of

gains or losses arising from cash flow

hedging instruments

6.2.6 Translation

differences arising from translation

of foreign currency financial

statements

785397.11 85239.36

6.2.7 Other

Other comprehensive income (net

of tax) attributable to non-controlling

interests

336598.76 36531.15

7. Total comprehensive income for

the year

98015545.17 333259783.41

Attributable to Shareholders of

the company

97644473.66 333241082.77

Attributable to non-controlling

interests

371071.51 18700.64

8. Earnings per share

8.1 Basic earnings per share 0.0962 0.3293

8.2 Diluted earnings per share 0.0962 0.3293

In a business combination involving enterprises under common control (net losses)/net profit of the

acquiree before the combination date is RMB 0.00 and (net losses)/net profit of the acquiree in prior

period is RMB 0.00.Legal representative: Liu Zhengyu The person in charge of accounting affairs:

Tang Xiaoping The head of the accounting department: Qiao Yanjun

4.Income Statement of the Company as the Parent

Expressed in RMB

Item Jan to Jun 2020 Jan to Jun 2019

1. Operating revenue 231361037.44 828403076.11

Less: Cost of sales 64778297.24 125366701.31

Taxes and surcharges 69869636.48 305591891.73

Selling and distribution

expenses

3544826.68 12219149.43

General and

administrative expenses

23912101.72 12993667.10

Research and

development expenses

Financial expenses -21037122.06 -16493119.65

Including: Interest

expense

Interest income 17954071.46 17457395.53

Add: Other income 28083.69

Investment income ("-"

for losses)

15217058.60 532988230.19

Including: Income from

investment in associates and joint

ventures ("-" for losses)

Income from the

derecognition of financial assets at

amortized cost (“-” for loss)

Net gain on exposure

hedges (“-” for loss)

Gains from changes in

fair value ("-" for losses)

Credit impairment loss

(“-” for loss)

Impairment losses ("-" for

losses)

Gains from assets

disposal ("-" for losses)

2. Operating profit (“-” for loss) 105538439.67 921713016.38

Add: Non-operating income 170000.10 129179.14

Less: Non-operating expense 502140.62

3. Profit before income tax ("-" for

losses)

105206299.15 921842195.52

Less: Income tax expense 27690892.73 100591211.17

4. Net profit for the year ("-" for net

losses)

77515406.42 821250984.35

4.1 Net profit from continuing

operations ("-" for net loss)

77515406.42 821250984.35

4.2 Net profit from

discontinued operations ("-" for net

loss)

5. Other comprehensive income net

of tax

320373.69

5.1 Items that will not be

reclassified to profit or loss

320373.69

5.1.1 Remeasurement

of defined benefit plan liability or

asset

5.1.2 Share of other

comprehensive income of the equity

method investments

5.1.3 Changes in the

fair value of investments in other

equity instruments

320373.69

5.1.4 Changes in the

fair value of the company’s credit

risks

5.1.5 Other

5.2 Items that may be

reclassified to profit or loss

5.2.1 Share of other

comprehensive income of the equity

method investments

5.2.2 Changes in the fair

value of investments in other debt

obligations

5.2.3 Other

comprehensive income arising from

the reclassification of financial

assets

5.2.4 Allowance for

credit impairments in investments

in other debt obligations

5.2.5 Effective portion

of gains or losses arising from cash

flow hedging instruments

5.2.6 Translation

differences arising from translation

of foreign currency financial

statements

5.2.7 Other

6. Total comprehensive income for

the year

77835780.11 821250984.35

7. Earnings per share

7.1 Basic earnings per share

7.2 Diluted earnings per share

5.Consolidated Cash Flow Statement

Expressed in RMB

Item Jan to Jun 2020 Jan to Jun 2019

1. Cash flows from operating

activities

Proceeds from sales of goods

or rendering of services

685612219.39 1551108627.63

Net increase deposits from

customers and placements from

corporations in the same industry

Net increase in loans from

central bank

Net increase in loans from

other

financial institutions

Cash premiums received on

original

insurance contracts

Net proceeds from reinsurance

Net increase in deposits and

investments from insurers

Interest handling charges and

commissions received

Net increase in fund deposits

Net increase in proceeds from

repurchase transactions

Net proceeds from acting

trading of securities

Refund of taxes 15618.75

Proceeds from other operating

activities

42510375.71 36673219.30

Sub-total of cash inflows 728138213.85 1587781846.93

Payment for goods and

services

214833176.41 325301988.40

Net increase in loans and

payments on behalf

Net increase in deposits in

central bank and interbank

Payments of claims for

original insurance contracts

Net increase in fund paid

Interest handling charges and

commissions paid

Commissions on issuance

policies paid

Payment to and for employees 73647542.55 75087594.73

Payments of various taxes 543169493.34 372824861.97

Payment for other operating

activities

108730800.14 128892156.73

Sub-total of cash outflows 940381012.44 902106601.83

Net cash flows from operating

activities

-212242798.59 685675245.10

2. Cash flows from investing

activities:

Proceeds from disposal of

investments

Investment returns received 20317808.22 11365734.25

Net proceeds from disposal of

fixed assets intangible assets and

other long-term assets

1000.00

Net proceeds from disposal of

subsidiaries and other business

units

Proceeds from other investing

activities

1000000000.00 900000000.00

Sub-total of cash inflows 1020318808.22 911365734.25

Payment for acquisition of

fixed assets intangible assets and

other long-term assets

55767.90 62330.82

Payment for acquisition of

investments

Net increase in pledged loans

Net payment for acquisition of

subsidiaries and other business

units

Payment for other investing

activities

1300000000.00

Sub-total of cash outflows 55767.90 1300062330.82

Net cash flows from investing

activities

1020263040.32 -388696596.57

3. Cash flows from financing

activities:

Proceeds from investors

Including: Proceeds from

non-controlling shareholders of

subsidiaries

Proceeds from borrowings

Proceeds from other financing

activities

Sub-total of cash inflows

Repayments of borrowings 2000000.00

Payment for dividends profit 166923900.00 202332000.00

distributions or interest

Including: Dividends and

profits paid to non-controlling

shareholders of subsidiaries

Payment for other financing

activities

Sub-total of cash outflows 166923900.00 204332000.00

Net cash flows from financing

activities

-166923900.00 -204332000.00

4. Effect of foreign exchange rate

changes on cash and cash

equivalents

-63668.21 -688191.31

5. Net increase in cash and cash

equivalents

641032673.52 91958457.22

Add: Cash and cash

equivalents as at the year beginning

1507189760.35 1148522435.93

6. Cash and cash equivalent as at

the ended

2148222433.87 1240480893.15

6. Cash Flow Statement of the Company as the Parent

Expressed in RMB

Item Jan to Jun 2020 Jan to Jun 2019

1. Cash flows from operating

activities:

Proceeds from sales of goods

or rendering of services

350704786.01 1082309354.32

Refund of taxes

Proceeds from other operating

activities

7424276.64 25673942.66

Sub-total of cash inflows 358129062.65 1107983296.98

Payment for goods and

services

14267901.93 54302822.21

Payment to and for employees 17517984.42 19289743.31

Payments of various taxes 68674752.15 135622840.23

Payment for other operating

activities

261704229.68 26108489.89

Sub-total of cash outflows 362164868.18 235323895.64

Net cash flows from operating

activities

-4035805.53 872659401.34

2. Cash flows from investing

activities:

Proceeds from disposal of

investments

Investment returns received 20317808.22 142838563.97

Net proceeds from disposal of

fixed assets intangible assets and

other long-term assets

Net proceeds from disposal of

subsidiaries and other business

units

Proceeds from other investing

activities

1000000000.00 900000000.00

Sub-total of cash inflows 1020317808.22 1042838563.97

Payment for acquisition of

fixed assets intangible assets and

other long-term assets

41498.00 6050.00

Payment for acquisition of

investments

Net payment for acquisition of

subsidiaries and other business

units

Payment for other investing

activities

1300000000.00

Sub-total of cash outflows 41498.00 1300006050.00

Net cash flows from investing

activities

1020276310.22 -257167486.03

3. Cash flows from financing

activities:

Proceeds from investors

Proceeds from borrowings

Cash generated from other

financing activities

Sub-total of cash inflows

Repayments of borrowings

Payment for dividends profit 166923900.00 202332000.00

distributions or interest

Payment for other financing

activities

Sub-total of cash outflows 166923900.00 202332000.00

Net cash flows from financing

activities

-166923900.00 -202332000.00

4. Effect of foreign exchange rate

changes on cash and cash

equivalents

-191346.36 -676807.86

5. Net increase in cash and cash

equivalents

849125258.33 412483107.45

Add: Cash and cash

equivalents as at the year beginning

963737437.55 444486378.53

6. Cash and cash equivalent as at

the ended

1812862695.88 856969485.98

7. Consolidated Statement of Changes in Shareholders' Equity

Expressed in RMB

Items

Jan To Jun 2020

Attributable to shareholders' equity of the parent company

Non-controll

ing interests

Total

Share capital

Other equity

instruments

Capital

reserve

Less:

Treasu

ry

shares

Other

comprehens

ive income

Speci

al

reser

ve

Surplus

reserve

Gener

al

reserv

e

Retained

earnings

Othe

rs

Subtotal Preferen

ce

shares

Perpet

ual

bond

Oth

er

I. Balance at

the end of

last year

101166000

0.00

97824491

0.11

20831004.

13

19122283

8.94

146491581

6.81

366687456

9.99

-14189133

5.84

352498323

4.15

Add:

Changes of

accounting

policies

Correction

of prior

period errors

Business

combination

involving

enterprises

under

common

control

Others

II. Balance

at the

Beginning

of the Year

101166000

0.00

97824491

0.11

20831004.

13

19122283

8.94

146491581

6.81

366687456

9.99

-14189133

5.84

352498323

4.15

III. Changes

in equity

during theyear (“- "fordecrease)

369487.94

-69648914.2

8

-69279426.3

4

371071.51

-68908354.8

3

(I) Total

comprehensi

ve income

369487.94

97274985.7

2

97644473.6

6

371071.51

98015545.1

7

(II)

Shareholder

s'

contribution

s and

decrease of

capital

1.Contributi

on by

ordinary

shareholders

2. Holders

of other

equity

instruments

invested

capital

3. Equity

settled

share-based

payments

4.Others

(III)

Appropriati

on of profits

-166923900.

00

-166923900.

00

-166923900.

00

1.Appropriat

ion for

surplus

reserves

2.Appropriat

ion for

general

reserves

3.Distributio

n to

shareholders

-166923900.

00

-166923900.

00

-166923900.

00

4.Others

(IV)Transfer

within

equity

1.Share

capital

increased by

capital

reserves

transfer

2.Share

capital

increased by

surplus

reserves

transfer

3.Transfer

of surplus

reserve to

offset losses

4.

Remeasure

ment of

defined

benefit plan

liability or

asset

transfer to

retained

earnings

5. Other

comprehensi

ve income

carried

forward to

retained

earnings

6. Others

(V) Special

Reserve

1.

Appropriati

on during

the year

2.

Utilization

during the

year

(VI) Others

IV. Balance

at the end of

the period

101166000

0.00

97824491

0.11

21200492.

07

19122283

8.94

139526690

2.53

359759514

3.65

-14152026

4.33

345607487

9.32

Expressed in RMB

Item

Jan To Jun 2019

Attribute to the equity of parent company Minority

interests

Total owners'

S equity

Share capital

Other equity

instruments

Capital

reserve

Less:

Treasu

ry

shares

Other

comprehens

ive income

Speci

al

reser

ve

Surplus

reserve

Gener

ic risk

reserv

e

Retained

earnings

Othe

rs

Subtotal

Preferen

ce

shares

Perpet

ual

bond

Oth

er

I. Balance at

the end of

last year

101166000

0.00

97824491

0.11

10564385.

97

95906222

.59

123588412

2.72

333225964

1.39

-13152453

0.88

320073511

0.51

Add:

Changes of

accounting

policies

Correction

of prior

period errors

Business

combination

involving

enterprises

under

common

control

Others

II. Balance

at the

Beginning

of the Year

101166000

0.00

97824491

0.11

10564385.

97

95906222

.59

123588412

2.72

333225964

1.39

-13152453

0.88

320073511

0.51

III. Changes

in equity

85239.36

130823843.

41

130909082.

77

18700.64

130927783.

41

during theyear (“- "fordecrease)

(I) Total

comprehensi

ve income

85239.36

333155843.

41

333241082.

77

18700.64

333259783.

41

(II)

Shareholder

s'

contribution

s and

decrease of

capital

1.Contributi

on by

ordinary

shareholders

2. Holders

of other

equity

instruments

invested

capital

3. Equity

settled

share-based

payments

4.Others

(III)

Appropriatio

n of profits

-202332000.

00

-202332000.

00

-202332000.

00

1.Appropriat

ion for

surplus

reserves

2.Appropriat

ion for

general

reserves

3.Distributio

n to

shareholders

-202332000.

00

-202332000.

00

-202332000.

00

4.Others

(IV)Transfer

within

equity

1.Share

capital

increased by

capital

reserves

transfer

2.Share

capital

increased by

surplus

reserves

transfer

3.Transfer

of surplus

reserve to

offset losses

4.

Remeasure

ment of

defined

benefit plan

liability or

asset

transfer to

retained

earnings

5. Other

comprehensi

ve income

carried

forward to

retained

earnings

6. Others

(V) Special

Reserve

1.

Appropriatio

n during the

year

2.

Utilization

during the

year

(VI) Others

IV. Balance

at the end of

the period

101166000

0.00

97824491

0.11

10649625.

33

95906222

.59

136670796

6.13

346316872

4.16

-13150583

0.24

333166289

3.92

8. Company's Statement of Changes in Shareholders' Equity

Expressed in RMB

Items

Jan to Jun 2020

Share capital

Other equity

instruments

Capital reserve

Less:

Treasury

shares

Other

comprehensive

income

Special

reserve

Surplus reserve

Retained

earnings

Others

Total owners' S

equity Preference

shares

Perpetual

bond

Other

I. Balance at the

end of last year

1011660000.00 964711931.13 922125.77 168093225.53 1280197219.96 3425584502.39

Add: Changes

of accounting

policies

Correction of prior

period errors

Others

II. Balance at the

Beginning of the

Year

1011660000.00 964711931.13 922125.77 168093225.53 1280197219.96 3425584502.39

III. Changes in

equity during theyear (“- "fordecrease)

320373.69 -89408493.58 -89088119.89

(I) Total

comprehensive

income

320373.69 77515406.42 77835780.11

(II) Shareholders'

contributions and

decrease of capital

1.Contribution by

ordinary

shareholders

2. Holders of

other equity

instruments

invested capital

3. Equity settled

share-based

payments

4.Others

(III) appropriation

of profits

-166923900.00 -166923900.00

1. Appropriation

for surplus

reserves

2. Appropriation

for general

reserves

-166923900.00 -166923900.00

3.Others

(IV) Transfer

within equity

1.Share capital

increased by

capital reserves

transfer

2.Share capital

increased by

surplus reserves

transfer

3.Transfer of

surplus reserve to

offset losses

4. Remeasurement

of defined benefit

plan liability or

asset transfer to

retained earnings

5. Other

comprehensive

income carried

forward to retained

earnings

6. Others

(V) Special

Reserve

1. Appropriation

during the year

2. Utilization

during the year

(VI) Others

IV. Balance at the

end of the period

1011660000.00 964711931.13 1242499.46 168093225.53 1190788726.38 3336496382.50

Expressed in RMB

Items

Jan To Jun 2019

Share capital

Other equity

instruments

Capital reserve

Less:

Treasury

shares

Other

comprehensive

income

Special

reserve

Surplus

reserve

Retained

earnings

Others

Total owners' S

equity Preference

shares

Perpetual

bond

Other

I. Balance at the

end of last year

1011660000.00 964711931.13 72776609.18 615038028.05 2664186568.36

Add: Changes

of accounting

policies

Correction of prior

period errors

Others

II. Balance at the

Beginning of the

Year

1011660000.00 964711931.13 72776609.18 615038028.05 2664186568.36

III. Changes in

equity during theyear (“- "fordecrease)

618918984.35 618918984.35

(I) Total

comprehensive

income

821250984.35 821250984.35

(II) Shareholders'

contributions and

decrease of capital

1.Contribution by

ordinary

shareholders

2. Holders of

other equity

instruments

invested capital

3. Equity settled

share-based

payments

4.Others

(III) appropriation

of profits

-202332000.00 -202332000.00

1. Appropriation

for surplus reserves

2. Appropriation

for general reserves

-202332000.00 -202332000.00

3.Others

(IV) Transfer

within equity

1.Share capital

increased by capital

reserves transfer

2.Share capital

increased by

surplus reserves

transfer

3.Transfer of

surplus reserve to

offset losses

4. Remeasurement

of defined benefit

plan liability or

asset transfer to

retained earnings

5. Other

comprehensive

income carried

forward to retained

earnings

6. Others

(V) Special

Reserve

1. Appropriation

during the year

2. Utilization

during the year

(VI) Others

IV. Balance at the

end of the period

1011660000.00 964711931.13 72776609.18 1233957012.40 3283105552.71

III. Company information

Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd. (the “Group” or “the

Company”) was established in July 1993 as approved by the Shenzhen Municipal Government with

document SFBF (1993) 724. The Company issued A shares on 15 September 1993 and issued B shares

on 10 January 1994. On 31 August 1994 the issued B shares were listed in the New York Exchange

market as class A recommendation. The total share capital is 1011660000 shares including

891660000 of A shares and 120000000 of B shares. The company business license registration

number is 440301103225878 and the registered capital is RMB 1011660000.00. The Company’s

headquarter is at Floor 45-48 Shen Fang Plaza Ren Min South Road Luo Hu District Shen Zhen

Guangdong province.

On 13 October 2004 according to the document No. (2004) 223 “Decision on establishing Shenzheninvestment Holding Co. Ltd.” issued by State-Owned Assets Supervision and Administration

Commission of Shenzhen Municipal Government former major shareholder – Shenzhen Construction

Investment Holding Company with two assets management companies merged to form the Shenzhen

Investment Holding Co. Ltd. By the State-owned Assets Supervision and Administration Commission

of the state council and quasi-exempt obligations tender offer as approved by China Security

Regulatory Committee with document No. (2005)116 this issue of consolidated has been authorized

and the change in registration had been completed on 15 February 2006. At the end of the reporting

period Shenzhen Investment Holding Limited holds 642884262 shares of the Company (63.55% of

the total share capital). The shares are all tradable unrestricted shares.The Company has established the corporate governance structure of the general meeting of

shareholders the board of directors and board of supervisors with human resources department

financing plan department marketing department engineering management department etc. in place.The Company and its subsidiaries (hereinafter referred to as "the Group") are principally engaged in

real estate development and sales property leasing and management retail merchandising and trade

hotel equipment installation and maintenance construction interior decoration etc.The consolidated and company financial statements and the notes to financial statements have been

approved by the 7

th

Board of Directors in the 54

th

board meeting on 18 August 2020.The company’s consolidation scope for the current year has not changed compared with the previous

year. For details please refer to Note VIII “Changes in the scope of consolidation” and Note IX

“Interests in other entities”.IV. The Basis of Preparation of Financial Statements

1. Basis of preparation

The financial statements are prepared in accordance with the Accounting Standards for Business

Enterprises and corresponding application guidance interpretations and other related provisions issued

by the Ministry of Finance (collectively " Accounting Standards for Business Enterprises "). In

addition the Group also discloses relevant financial information in accordance with the rules of

information disclosure for publicly issued securities companies No. 15 - general provisions on financial

reporting (revised in 2014) of the China securities regulatory commission.The Company adopts the accrual basis of accounting. Except for certain financial instruments the

financial statements are prepared under the historical cost convention. In the event that impairment of

assets occurs a provision for impairment is made accordingly in accordance with the relevant

regulations.2. Going concern

The financial statements of the Company have been prepared on going concern basis.V. Significant accounting policies and accounting estimates

Reminders on specific accounting policies and accounting estimates:

The company according to the new revenue standard and the characteristics of the company’s

production and operation to determine the revenue recognition policy the specific accounting policy

please refer to Note V.39

1. Statement of compliance with the Accounting Standards for Business Enterprises

The financial statements have been prepared in compliance with the Accounting Standards for Business

Enterprises to truly and completely present the Company and consolidated financial position as at June

30 2020 and the Company and consolidated operating results and cash flows for 1 January 1 to 30 June

2020.

2. Accounting Period

The accounting period of the Company is from 1 January to 31 December.

3. Operating Period

The operating period of the Company is 12 months.

4. Functional currency

The Company and domestic subsidiaries use Renminbi (“RMB”) as their functional currency.Offshore subsidiaries determine US Dollar (“USD”) as their functional currency according to the

primary economic environment where they operate. The financial statements of the Company have

been prepared in RMB.

5. Accounting treatments for business combinations involving enterprises under common control

and not under common control

(1) Business combinations involving enterprises under common control

For a business combination involving enterprises under common control the assets acquired and

liabilities assumed are measured based on their carrying amounts in the consolidated financial

statements of the ultimate controlling party at the combination date except for adjustments due to

different accounting policies. The difference between the carrying amount of the net assets acquired

and the consideration paid for the combination (or the total par value of shares issued) is adjusted

against share premium in the capital reserve with any excess adjusted against retained earnings.

Business combinations involving enterprises under common control and achieved in stages.

In the separate financial statements the initial investment cost is calculated based on the shareholding

portion of the assets and liabilities obtained and are measured at the carrying amounts as recorded by

the enterprise being combined at the combination date. The difference between the initial investment

cost and the sum of the carrying amount of the original investment cost and the carrying amount of

consideration paid for the combination is adjusted to the capital reserve if the capital reserve is not

sufficient to absorb the difference the excess difference shall be adjusted to retained earnings.In the consolidated financial statements the assets and liabilities obtained at the combination shall be

measured at the carrying value as recorded by the enterprise at combination date except for

adjustments of different accounting policies. The difference between the sum of the carrying value

from original shareholding portion and the new investment cost incurred at combination date and the

carrying value of net assets obtained at combination date shall be adjusted to capital reserve if the

balance of capital reserve is not sufficient to absorb the differences any excess is adjusted to retained

earnings. The long-term investment held by the combination party the recognized profit or lose

comprehensive income and other change of shareholding’s equity at the closer date of the acquisition

date and combination date under common control shall separately offset the opening balance of

retained earnings and profit or loss during comparative statements.

(2) Business combinations involving enterprises not under common control

For business combinations involving enterprises not under common control the consideration costs

include acquisition-date fair value of assets transferred liabilities incurred or assumed and equity

securities issued by the acquirer in exchange for control of the acquiree. At the acquisition date the

acquired assets liabilities and contingent liabilities of the acquiree are measured at their fair value. The

acquiree’s identifiable asset liabilities and contingent liabilities are recognised at their acquisition-date

fair value.Where the combination cost exceeds the acquirer’s interest in the fair value of the acquiree’s

identifiable net assets the difference is recognised as goodwill and subsequently measured on the basis

of its cost less accumulated impairment provisions. Where the combination cost is less than the

acquirer’s interest in the fair value of the acquiree’s identifiable net assets the difference is recognised

in profit or loss for the current period after reassessment.

Business combinations involving enterprises not under common control and achieved in stages

In the separate financial statements the initial investment cost of the investment is the sum of the

carrying amount of the equity investment held by the entity prior to the acquisition date and the

additional investment cost at the acquisition date. The disposal accounting policy of other

comprehensive income related with equity investment prior to the purchase date recognized under

equity method shall be compliance with the method when the acquiree disposes the related assets or

liabilities. Shareholder’s equity due to the changes of other shareholder’s equity other than the changes

of net profit other comprehensive income and profit distribution shall be transferred to profit or loss

for current period when disposed. If the equity investment held by the entity prior to the acquisition

date is measured at fair value the cumulative changes in fair value recognized in other comprehensive

income shall be transferred to profit or loss for current period when accounted for using cost method.In the consolidation financial statements the combination cost is the sum of consideration paid at

acquisition date and fair value of the acquiree’s equity investment held prior to acquisition date; the

cost of equity of the acquiree held prior to acquisition date shall be re-measured at the fair value at

acquisition date the difference between the fair value and book value shall be recognized as investment

income or loss for the current period. Other comprehensive income and changes of investment equity

related with acquiree’s equity held prior to acquisition date shall be transferred to investment profit or

loss for current period at acquisition date besides there is other comprehensive income incurred by the

changes of net assets or net liabilities due to the re-measurement of defined benefit plan.(3) Transaction costs for business combination

The overhead for the business combination including the expenses for audit legal services valuation

advisory and other administrative expenses are recorded in profit or loss for the current period when

incurred. The transaction costs of equity or debt securities issued as the considerations of business

combination are included in the initial recognition amount of the equity or debt securities.

6. Consolidated financial statements

(1) Scope of consolidated financial statements

The scope of consolidated financial statements is based on control. Control exists when the Company

has power over the investee; exposure or rights to variable returns from its involvement with the

investee and has the ability to affect its returns through its power over the investee. A subsidiary is an

entity that is controlled by the Company (including enterprise a portion of an investee as a deemed

separate component and structured entity controlled by the enterprise).

(2) Basis of preparation of consolidated financial statements

The consolidated financial statements are prepared by the Company based on the financial statements

of the Company and its subsidiaries and other relevant information. When preparing consolidated

financial statements the accounting policies and accounting periods of the subsidiaries should be

consistent with those established by the Company and all significant intra-group balances and

transactions are eliminated.Where a subsidiary or business was acquired during the reporting period through a business

combination involving enterprises under common control the financial statements of the subsidiary or

business are included in the consolidated financial statements as if the combination had occurred at the

date that the ultimate controlling party first obtained control.Where a subsidiary or business was acquired during the reporting period through a business

combination involving enterprises not under common control the identifiable assets and liabilities of

the acquired subsidiaries or business are included in the scope of consolidation from the date that

control commences.The portion of a subsidiary’s equity that is not attributable to the parent is treated as non-controlling

interests and presented separately in the consolidated balance sheet within shareholders’ equity. The

portion of net profit or loss of subsidiaries for the period attributable to non-controlling interests is

presented separately in the consolidated income statement below the “net profit” line item. When the

amount of loss for the current period attributable to the non-controlling shareholders of a subsidiary

exceeds the non-controlling shareholders’ share of the opening owners’ equity of the subsidiary the

excess is still allocated against the non-controlling interests.

(3) Changes in non-controlling interests

Where the Company acquires a non-controlling interest from a subsidiary’s non-controlling

shareholders or disposes of a portion of an interest in a subsidiary without a change in control the

transaction is treated as equity transaction and the book value of shareholder’s equity attributed to the

Company and to the non-controlling interest is adjusted to reflect the change in the Company’s interest

in the subsidiaries. The difference between the proportion interests of the subsidiary’s net assets being

acquired or disposed and the amount of the consideration paid or received is adjusted to the capital

reserve in the consolidated balance sheet with any excess adjusted to retained earnings.

(4) Disposal of subsidiaries

When the Company loses control over a subsidiary because of disposing part of equity investment or

other reasons the remaining part of the equity investment is re-measured at fair value at the date when

the control is lost. A gain or loss is recognised in the current period and is calculated by the aggregate

of consideration received in disposal and the fair value of remaining part of the equity investment

deducting the share of net assets in proportion to previous shareholding percentage in the former

subsidiary since acquisition date and the goodwill.Other comprehensive income related to the former subsidiary is transferred to profit or loss when the

control is lost except for the comprehensive income arising from the movement of net liabilities or

assets in the former subsidiary’s re-measurement of defined benefit plan.

7. Joint arrangement classification and accounting treatment for joint operation

A joint arrangement is an arrangement of which two or more parties have joint control. The Company

classifies joint arrangements into joint operations and joint ventures.

(1) Joint operations

A joint operation is a joint arrangement whereby the joint operators have rights to the assets and

obligations for the liabilities relating to the arrangement.The Company recognizes the following items relating to its interest in a joint operation and account for

them in accordance with relevant accounting standards:

A. its solely-held assets and its share of any assets held jointly;

B. its solely-assumed liabilities and its share of any liabilities assumed jointly;

C. its solely-assumed liabilities and its share of any liabilities assumed jointly;

D. its share of the revenue from the sale of the output by the joint operation; and

E. its solely-incurred expenses and its share of any expenses incurred jointly.

(2) Joint ventures

A joint venture is a joint arrangement whereby the joint venturers have rights to the net assets of the

arrangement.The Company adopts equity method under long-term equity investment in accounting for its

investment in joint venture.8. Cash and cash equivalents

Cash comprises cash in hand and deposits that can be readily withdrawn on demand. Cash equivalents

include short-term highly liquid investments that are readily convertible to known amounts of cash and

are subject to an insignificant risk of change in value.

9. Foreign currency transactions and translation of foreign currency financial statements

1) Foreign currency transactions

Foreign currency transactions are translated to the functional currency of the Company at the spot

exchange rates on the dates of the transactions.Monetary items denominated in foreign currencies are translated to Renminbi at the spot exchange rate

at the balance sheet date. The resulting exchange differences between the spot exchange rate on

balance sheet date and the spot exchange rate on initial recognition or on the previous balance sheet

date are recognised in profit or loss. Non-monetary items that are measured at historical cost in foreign

currencies are translated to Renminbi using the exchange rate at the transaction date. Non-monetary

items that are measured at fair value in foreign currencies are translated using the exchange rate at the

date the fair value is determined. The resulting exchange differences are recognised in profit or loss.

(2) Translation of foreign currency financial statements

When translating the foreign currency financial statements of overseas subsidiaries assets and

liabilities of foreign operation are translated to Renminbi at the spot exchange rate at the balance sheet

date. Equity items excluding “retained earnings” are translated to Renminbi at the spot exchange rates

at the transaction dates.Income and expenses of foreign operation are translated to Renminbi at the spot exchange rates at the

transaction dates.

Cash flow statement of foreign operation is translated to Renminbi at the spot exchange rates [the rates

determined under a systematic and rational method that approximate the spot exchange rates] at the

cash flow occurrence dates. Effect of foreign exchange rate changes on cash and cash equivalents is

presented separately as “Effect of foreign exchange rate changes on cash and cash equivalents” in the

cash flow statement.The resulting translation differences are recognised in other comprehensive income in shareholders’

equity of balance sheet.The translation differences accumulated in shareholders’ equity with respect to a foreign operation are

transferred to profit or loss in the period when the foreign operation is disposed.

10. Financial instruments

Financial instruments refer to the contracts of forming enterprise financial assets and other entities’

financial liabilities or equity instruments.(1) Recognition and Derecognition of financial instruments

A financial asset or financial liability is recognised when the Group becomes one party of financial

instrument contracts.If one of the following conditions is met the financial assets are terminated:

① The right of the contract to receive the cash flows of financial assets terminates

② The financial asset has been transferred and is in accordance with the following conditions for

derecognition.If the obligations of financial liability have been discharged in total or in part derecognize all or part of

it. If the Group (debtor) makes an agreement with the creditor to replace the current financial liability

of assuming new financial liability which contract provisions are different in substance derecognize

the current financial liability and meanwhile recognize as the new financial liability.If the financial assets are traded routinely they are recognised and derecognised at the transaction date.

(2) Classification and measurement of financial assets

Financial assets are classified into the following three categories depends on the Group’s business

mode of managing financial assets and cash flow characteristics of financial assets: financial assets

measured at amortized cost financial assets at fair value through other comprehensive income and

financial assets at fair value through profit or loss.

Financial assets measured at amortised cost

The Group shall classify financial assets that meet the following conditions and are not designated as

financial assets at fair value through profit or loss as financial assets measured at amortized cost:

· The Group’s business model for managing the financial assets is to collect contractual cash

flows;

· The terms of the financial asset contract stipulate that cash flows generated on a specific date are

only payments of principal and interest based on the amount of outstanding principal.

After initial confirmation the real interest rate method is used to measure the amortized cost of such

financial assets. Profits or losses arising from financial assets measured at amortized costs and not part

of any hedging relationship is included in current profits and losses when the recognition is terminated

amortized or impaired according to the Actual Interest Rate Law.

Financial assets at fair value through other comprehensive income

The Group shall classify financial assets that meet the following conditions and are not designated as

financial assets measured at fair value and whose changes are recorded in current profits and losses as

financial assets measured at fair value through other comprehensive income:

· The Group’s business model for managing the financial assets is both to collect contractual cash

flows and to sell the financial assets;

· The terms of the financial asset contract stipulate that cash flows generated on a specific date are

only payments of principal and interest based on the amount of outstanding principal.

After initial recognition financial assets are subsequently measured at fair value. Interest impairment

losses or gains and exchange gains calculated by the effective interest rate method are recognised in

profit or loss while other gains or losses are recognised in other comprehensive gains. When

derecognized the accumulated gains or losses previously recognised in other comprehensive gains

are transferred from other comprehensive gains and recorded in current profits and losses.

Financial assets at fair value through profit or loss

In addition to the aboving financial assets which are measured at amortized cost or at fair value a

through other comprehensive income the Group classifies all other financial assets as financial assets

measured at fair value through profit or loss. When initial recognition in order to eliminate or

significantly reduce accounting mismatches the Group irrevocably designates some financial assets

that should have been measured at amortized cost or at fair value through other comprehensive gains as

financial assets at fair value through profit or loss.

After initial recognition the financial assets are subsequently measured at fair value and the profits or

losses (including interest and dividend income) generated from which are recognised in profit or loss

unless the financial assets are part of the hedging relationship.However for non-tradable equity instrument investment when initially recognized the Group

irrevocably designates them as financial assets at fair value through other comprehensive gains. The

designation is made on the basis of individual investment and the relevant investment conforms to the

definition of equity instruments from the issuer’s point of view.

After initial confirmation financial assets are subsequently measured at fair value. Dividend income

that meets the requirements is recognised in profit and loss and other gains or losses and changes in

fair value are recognised in other comprehensive gains. When derecognized the accumulated gains or

losses previously recognised in other comprehensive gains are transferred from other comprehensive

gains to retained earnings.The business model of managing financial assets refers to how the group manages financial assets to

generate cash flow. The business model decides whether the source of cash flow of financial assets

managed by the Group is to collect contract cash flow sell financial assets or both of them. Based on

objective facts and the specific business objectives of financial assets management decided by key

managers the Group determines the business model of financial assets management.The Group evaluates the characteristics of the contract cash flow of financial assets to determine

whether the contract cash flow generated by the relevant financial assets on a specific date is only to

pay principal and interest based on the amount of unpaid principal. Among them principal refers to the

fair value of financial assets at the time of initial confirmation; interest includes the consideration of

time value of money credit risk related to the amount of unpaid principal in a specific period and other

basic borrowing risks costs and profits. In addition the Group evaluates the terms and conditions of

the contracts that may lead to changes in the time distribution or amount of cash flow in financial asset

contracts to determine whether they meet the requirements of the aboving contract cash flows.characteristics

Only when the Group changes its business model of managing financial assets all the financial assets

affected shall be reclassified on the first day of the first reporting period after the business model

changes otherwise financial assets shall not be reclassified after initial confirmation.

Financial assets are measured at fair value at initial recognition. For financial assets that are measured

at fair value and whose changes are included in the current profit and loss related transaction costs are

directly included in the current profit and loss; for other types of financial assets related transaction

costs are included in the initially recognized amount. For accounts receivable arising from the sale of

products or the provision of labor services that do not include or take into account significant financing

components the Group considers the amount of consideration expected to be entitled as the initial

recognition amount.

(3) Classification and Measurement of financial liabilities

On initial recognition financial liabilities are classified as: financial liabilities at fair value through

profit or loss (FVTPL) and financial liabilities measured at amortized cost. For financial liabilities not

classified as at fair value through profit or loss the transaction costs are recognised in the initially

recognised amount.

Financial liabilities at fair value through profits and losses

Financial liabilities at FVTPL include transaction financial liabilities and financial liabilities designated

as at fair value through profit or loss in the initial recognition. Such financial liabilities are

subsequently measured at fair value all gains and losses arising from changes in fair value and

dividend and interest expense relative to the financial liabilities are recognised in profit or loss for the

current period.

Financial liabilities measured at amortized cost

Other financial liabilities are subsequently measured at amortized cost using the effective interest

method; gains and losses arising from derecognition or amortization is recognised in profit or loss for

the current period.

Distinction between financial liabilities and equity instruments

The financial liability is the liability that meets one of following criteria:

① Contractual obligation to deliver cash or other financial instruments to another entity.

② Under potential adverse condition contractual obligation to exchange financial assets or financial

liabilities with other parties.

③ A contract that will or may be settled in the entity’s own equity instruments and is a non-derivative

for which the entity is or may be obliged to deliver a variable number of the entity’s own equity

instruments.

④ A derivative that will or may be settled other than by the exchange of a fixed amount of cash or

another financial asset for a fixed number of the entity’s own equity instruments.

An equity instrument is any contract that evidences a residual interest in the assets of an entity after

deducting all of its liabilities.If the group cannot unconditionally avoid fulfilling a contractual obligation by delivering cash or other

financial assets the contractual obligation meets the definition of financial liability.If a financial instrument must or are able to be settled by the group’s own equity instrument the group

should consider whether the group’s equity instrument as the settlement instrument is a substitute of

cash or other financial assets or the residual interest in the assets of an entity after deducting all of its

liabilities. If the former the tool is the group’s financial liability; if the latter the tool is the equity

instrument of the group.

(4) Fair value of financial instruments

The recognization of fair value of financial assets and financial liability is set out in note V. 11.

(5) Impairment of financial assets

On the basis of expected credit losses the Group performs impairment assessment on the following

items and confirms the loss provision.

· Financial assets measured at amortized cost;

· Accounts receivable and debt investments measured at fair value through profit or loss that

account in other comprehensive income.

· Contractual assets as defined in “Accounting Standard for Business Enterprises No.

14-Revenue""

· Lease receivables;

· Financial guarantee contract (except measured at fair value through profit or loss or formed by

continuing involvement of transferred financial assets or the transfer does not qualify for

derecognition).Measurement of expected credit losses

The expected credit losses refer to the weighted average of the credit losses of financial instruments

that are weighted by the risk of default. Credit loss refers to the difference between all contractual cash

flows receivable from the contract and all cash flows expected to be received by the Group at the

original effective interest rate that is the present value of all cash shortages.The company considers reasonable and reliable information about past events current conditions

future forecasts and weights the risk of default to calculate the probability-weighted amount of the

present value of the difference between the cash flow receivable under the contract and the cash flow

expected to be received in recognition of the expected credit loss.The Group separately measures the expected credit losses of financial instruments at different stages.The credit risk on a financial instrument has not increased significantly since initial recognition which

is in the first stage. The Group shall measure the loss allowance for that financial instrument at an

amount equal to 12-month expected credit losses. If the credit risk of financial instruments has

increased significantly since the initial recognition but no credit impairment has occurred which is in

the second stage. The Group shall measure the loss allowance for a financial instrument at an amount

equal to the lifetime expected credit losses. If the financial instrument has occurred credit impairment

since initial recognition which is in the third stage and the Group shall measure the loss allowance for

a financial instrument at an amount equal to the lifetime expected credit losses.

For financial instruments with lower credit risk at the balance sheet date the Group assumes that their

credit risk has not increased significantly since the initial recognition and shall measure the loss

allowance for that financial instrument at an amount equal to 12-month expected credit losses.The lifetime expected credit losses refer to the expected credit losses caused by all possible defaults

during the whole expected lifetime. The 12-month expected credit losses refer to the expected credit

losses caused by all possible defaults during the 12-month after balance sheet date (if the expected

duration of financial instrument is less than 12 months then for the expected duration) which is part of

the lifetime expected credit losses

When measure the expected credit loss the longest contract period (including the option of renewal)

that the group needs to consider is the longest contract period the enterprise facing credit risk.

For financial instruments in the first stages second stages and with lower credit risk the Group

calculates interest income on the basis of their book balances without deduction of impairment

provisions and actual interest rates. For financial instruments in the third stage the Group calculates

interest income according to their book balance minus the impairment provision and the actual interest

rate.

For bills receivable and accounts receivable whether or not there are significant financing elements

the Group shall always measure the loss allowance for them at an amount equal to the lifetime expected

credit losses.When information on expected credit losses cannot be assessed for a single financial asset in

accordance with the characteristics of credit risk the group divides and combines bills receivable

accounts receivable and leased receivables. On the basis of the combination the group calculates the

expected credit losses. The basis of determining the combination is as follows:

A. Notes receivable

· Notes receivable group 1: Bank acceptance bills

· Notes receivable group 2: Trade acceptance bills

B. Accounts receivable

· Accounts receivable group 1: Amount receivables of related parties

· Accounts receivable group 2: Amount receivables of other customers

C. Contractual assets

· Contractual assets group 1: Product sales

· Contractual assets group 2: Engineering construction

For the accounts receivable divided into group the group refers to the historical credit losses combines

the current situation with the forecast of future economic situation compiles a comparison table

between the age of accounts receivable and the lifetime expected credit losses rate to calculate the

expected credit losses.

For the bills receivables and contractual assets divided into group the Group refers to historical credit

losses with the current situation and the forecast of future economic situation calculates the expected

credit losses through the exposure on default and the lifetime expected credit losses rate.Other receivables

· According to the characteristics of credit risk the group divides other receivables into group. On

the basis of the combination the group calculates the expected credit losses. The basis of

determining the combination is as follows:

· Other receivables group 1: Amount receivables from employee’s inprest fund

· Other receivables group 2: Amount receivables from Deposit and security deposit

· Other receivables group 3: Amount receivables from related parties

· Other receivables group 4: Amount receivables from other transactions

For other receivables a divided into group the Group calculates the expected credit losses through the

exposure on default and the lifetime expected credit losses rate or the next 12 months.

Debt investments and Other debt investments

For debt investments and other debt investments the group calculates the expected credit losses

through the exposure on default and the future 12-month or lifetime expected credit losses rate

according to the nature of the investment the types of counterparty and risk exposure.

Assessment of Significant Increase in Credit Risk

By comparing the default risk of financial instruments on balance sheet day with that on initial

recognition day the Group determines the relative change of default risk of financial instruments

during the expected life of financial instruments to evaluate whether the credit risk of financial

instruments has increased significantly since the initial recognition.To determine whether credit risk has increased significantly since the initial recognition. the Group

considers reasonable and valid information including forward-looking information that can be

obtained without unnecessary additional costs or efforts. Information considered by the Group

includes:

· The debtor cannot pay principal and interest on the expiration date of the contract;

· Serious deterioration of external or internal credit ratings (if any) of financial instruments that

have occurred or are expected to occur;

· Serious deterioration of the debtor’s operating results that have occurred or are expected to occur;

· Changes in the existing or anticipated technological market economic or legal environment will

have a significant negative impact on the debtor’s repayment capacity.

According to the nature of financial instruments the Group evaluates whether credit risk has increased

significantly on the basis of a single financial instrument or a combination of financial instruments.When assessing on the basis of the combination of financial instruments the Group can classify

financial instruments based on common credit risk characteristics such as overdue information and

credit risk rating.If the delay exceeds 30 days the Group determines that the credit risk of financial instruments has

increased significantly.The Group considers that financial assets default in the following circumstances

· The debtor is unlikely to full pay its arrears to the group and the assessment does not take into

account recourse actions taken by the group such as liquidation of collateral (if held);

· Financial assets have delay more than 90 days.

Financial assets that have occurred credit impairment

On the balance sheet date the Group assesses whether credit impairment has occurred in financial

assets measured at amortized cost and debt investments measured at fair value through other

comprehensive income. When one or more events adversely affect the expected future cash flow of a

financial asset occur the financial asset becomes a financial asset with credit impairment. Evidence of

credit impairment of financial assets includes the following observable information:

· Significant financial difficulties occur to the issuer or debtor

· The debtor breaches any of the contractual stipulations for example fails to pay or delays the

payment of interests or the principal etc.

· For economic or contractual considerations related to the financial difficulties of the debtor the

Group grants concessions to the debtor that will not be made under any other circumstances.· The debtor is probable to go bankrupt or undergo other financial restructuring.· Financial difficulties of issuer or debtor lead to the disappearance of financial assets active

market. Presentation of expected credit losses reserve.Presentation of provision for expected credit losses

In order to reflect the changes happened to the credit risk of financial instruments since the initial

recognition the Group recalculates the expected credit losses on each balance sheet day. The increase

or reversal of the loss provision resulting therefrom is recognised as an impairment loss or gain in the

current profit or loss. For financial assets measured at amortized cost loss provision offsets the

carrying amount of the financial assets shown on the balance sheet; for debt investments measured at

fair value through other comprehensive income the Group recognizes its loss provision through other

comprehensive income and does not offset the financial assets’ carrying amount.Write off

If the Group no longer reasonably expects that the financial assets contract cash flow can be recovered

fully or partially the financial assets book balance will be reduced directly. Such reduction constitute

the derecognition of the financial assets. What usually occurs when the Group determines that the

debtor has no assets or sources of income to generate sufficient cash flows to pay the amount to be

reduced. However in accordance with the Group’s procedures for recovering due payment the

financial assets reduced may still be affected by enforcement activities.If the reduced financial assets are recovered later the returns as impairment losses shall be included in

the profits and losses of the recovery period.

(6) Transfer of financial assets

Transfer of financial assets refers to the transference or deliverance of financial assets to the other party

(the transferee) other than the issuer of financial assets.The Group derecognizes a financial asset only if it transfers substantially all the risks and rewards of

ownership of the financial asset to the transferee; the Group should not derecognize a financial asset if

it retains substantially all the risks and rewards of ownership of the financial asset.The Group neither transfers nor retains substantially all the risks and rewards of ownership shows as

the following circumstances: if the Group has forgone control over the financial assets derecognize the

financial assets and verify the assets and liabilities; if the Group retains its control of the financial asset

the financial asset is recognized to the extent of its continuing involvement in the transferred financial

asset and recognize an associated liability is recognized.

(7) Offsetting financial assets and financial liabilities

When the Group has the legal rights to offset the recognized financial assets and financial liabilities

and is capable to carry it out the Group plans to net settlement or realize the financial assets and pay

off the financial liabilities the financial assets and financial liabilities shall be listed separately with the

neutralized amount in balance sheet and are not allowed to be offset.11. Fair value measurement

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly

transaction between market participants at the measurement date.The Company measures related assets or liabilities at fair value assuming the assets or liabilities are

exchanged in an orderly transaction in the principal market; in the absence of a principal market

assuming the assets or liabilities are exchanged in an orderly transaction in the most advantageous

market. Principal market (or the most advantageous market) is the market that the Company can

normally enter into a transaction on measurement date. The Company adopts the presumptions that

would be used by market participants in achieving the maximized economic value of the assets or

liabilities.

For financial assets or financial liabilities with active markets the Company uses the quoted prices in

active markets as their fair value. Otherwise the Company uses valuation technique to determine their

fair value.

Fair value measurement of a non-financial asset takes into account market participants’ ability to

generate economic benefits using the asset in its best way or by selling it to another market participant

that would best use the asset.The Company uses valuation techniques that are appropriate in the circumstances and for which

sufficient data are available to measure fair value maximizing the use of relevant observable inputs

and using unobservable inputs only if the observable inputs aren’t available or impractical.

Fair value level for assets and liabilities measured or disclosed at fair value in the financial statements

are determined according to the significant lowest level input to the entire measurement: Level 1 inputs

are quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company can

access at the measurement date; Level 2 inputs are inputs other than quoted prices included within

Level 1 that are observable for the assets or liabilities either directly or indirectly; Level 3 inputs are

unobservable inputs for the assets or liabilities.

At the balance sheet date the Company revalues assets and liabilities being measured at fair value

continuously in the financial statements to determine whether to change the levels of fair value

measurement.

12. Notes receivable

Please refer to Note V. 10 financial instruments (5) Impairment of financial assets.

13. Accounts receivable

Please refer to Note V.10 financial instruments (5) Impairment of financial assets.14. Accounts receivable financing

Inapplicable

15. Other receivables

Determination method and accounting treatment method of expected credit loss of other receivables

Please refer to Note V 10. financial instruments (5) Impairment of financial assets.

16. Inventories

(1) Classification

The Group's inventory is classified by real estate development and non-real estate development.Inventory is mainly for real estate development including development costs and development

products. Development cost include the development costs of development products to be developed

and development products under construction. Development products includes completed development

products and intended to sell but temporarily leased development products. Non-real estate

developments include raw materials finished goods and construction.

(2) Measurement method of cost of inventories

Inventories are initially measured at cost. The cost of product development includes land transfer fee

infrastructure expenditure construction and installation project expenditure borrowing expenses

incurred before the completion of the development project and other related expenses in the

development process. When a product is developed and shipped the actual cost is determined by

specific identification method.Raw materials and finished goods are calculated using weighted average method.

(3) Basis for determining the net realisable value and method for provision for obsolete inventories

Net realisable value is the estimated selling price in the ordinary course of business less the estimated

costs of completion and the estimated costs necessary to make the sale and relevant taxes. The net

realisable value is measured based on the verified evidences and considerations for the purpose of

holding inventories and the effect of post balance sheet events.

Any excess of the cost over the net realisable value of inventories is recognised as a provision for

obsolete inventories and is recognised in profit or loss. The Company usually recognises provision for

decline in value of inventories by a single inventory item. If the factors caused the value of inventory

previously written-down have disappeared the provision for decline in value of inventories previously

made is reversed.

(4) Inventory count system

The Company maintains a perpetual inventory system.(5) Amortization methods of low-value consumables

Low-value consumables are charged to profit or loss when they are used.

17. Contractual assets

Inapplicable

18. Contractual cost

The contractual costs include the incremental cost incurred in obtaining the contract and the cost for

performance of the contract

The incremental cost incurred in obtaining the contract refers to the cost which will not incur as long as

the Group does not obtain the contract (such as sales commission etc.) If the cost is expected to be

recoverable the Group recognizes it as a contract acquisition cost as an asset. The Group's expenses

incurred in obtaining the contract other than the incremental cost expected to be recovered are included

in the current profit and loss when incurred.If the cost incurred in implementing the contract does not fall within the scope of other accounting

standards and regulations such as inventory and meets the following conditions at the same time the

Group shall recognize it as an asset as the contract performance cost:

① The cost is directly related to a current or expected contract including direct labor direct materials

manufacturing expenses (or similar expenses) clearly borne by the customer and other costs incurred

solely due to the contract;

② This cost increases the Group's resources for future performance obligations;

③ This cost is expected to be recoverable

Assets recognized for contract acquisition costs and assets recognized for contract performance costs

(hereinafter referred to as "assets related to contractual cost") are amortized on the same basis as the

revenue recognition of goods or services related to the asset and included in the current profit and loss.(If the amortization period does not exceed one year it shall be included in the current profit and loss

when it incurs.When the book value of the asset related to the contractual cost is higher than the difference between

the following two items the Group makes provision for impairment of the excess part and recognizes it

as an asset impairment loss:

① The residual consideration that the Group expects to obtain due to the transfer of the goods or

services related to the asset;

② The costs that shall incur for transferring the related goods or services as estimated.The contract performance cost recognized as an asset is presented in the item of “inventories” with the

amortization period not exceeding one year or one normal business cycle at the initial recognition

while it is presented in the item of "other non-current assets" with the amortization period not

exceeding one year or one normal operation cycle.The contract acquisition cost recognized as an asset is presented in the item of “other current assets”

with the amortization period not exceeding one year or one normal business cycle at the initial

recognition while it is presented in the item of "other non-current assets" with the amortization period

not exceeding one year or one normal operation cycle at the initial recognition.

19. Assets held for sale

Inapplicable

20. Equity investment

Inapplicable

21. Other equity investment

Inapplicable

22. Long-term receivables

Inapplicable

23. Long-term equity investments

Long-term equity investments include equity investments in subsidiaries and equity investments in

joint ventures and associates. An associate is an enterprise over which the Company has significant

influence.

(1) Determination of initial investment cost

The initial cost of a long-term equity investment acquired through a business combination involving

enterprises under common control is the Company’s share of the carrying amount of the subsidiary’s

equity in the consolidated financial statements of the ultimate controlling party at the combination date.

For a long-term equity investment obtained through a business combination not involving enterprises

under common control the initial cost is the combination cost.

A long-term equity investment acquired other than through a business combination: A long-term equity

investment acquired other than through a business combination is initially recognised at the amount of

cash paid if the Company acquires the investment by cash or at the fair value of the equity securities

issued if an investment is acquired by issuing equity securities.

(2) Subsequent measurement and recognition of profit or loss

Long-term equity investments in subsidiaries are accounted for using the cost method. An investment

in a joint venture or an associate is accounted for using the equity method for subsequent measurement.For a long-term equity investment which is accounted for using the cost method Except for cash

dividends or profit distributions declared but not yet distributed that have been included in the price or

consideration paid in obtaining the investments the Company recognises its share of the cash dividends

or profit distributions declared by the investee as investment income for the current period.

For a long-term equity investment which is accounted for using the equity method where the initial

cost of a long-term equity investment exceeds the Company’s interest in the fair value of the investee’s

identifiable net assets at the date of acquisition the investment is initially recognised at cost. Where the

initial investment cost is less than the Company’s interest in the fair value of the investee’s identifiable

net assets at the date of acquisition the investment is initially recognised at the investor’s share of the

fair value of the investee’s identifiable net assets and the difference is recognised in profit or loss.Under the equity method the Company recognises its share of the investee’s profit or loss and other

comprehensive income as investment income or losses and other comprehensive income respectively

and adjusts the carrying amount of the investment accordingly. Once the investee declares any cash

dividends or profit distributions the carrying amount of the investment is reduced by the amount

attributable to the Company. Changes in the Company’s share of the investee’s owners’ equity other

than those arising from the investee’s net profit or loss other comprehensive income or profit

distribution (referred to as “other changes in owners’ equity”) is recognised directly in the Company’s

equity and the carrying amount of the investment is adjusted accordingly. In calculating its share of the

investee’s net profits or losses other comprehensive income and other changes in owners’ equity the

Group recognises investment income and other comprehensive income after making appropriate

adjustments to align the accounting policies or accounting periods with those of the Group based on the

fair value of the investee’s identifiable net assets at the date of acquisition.When the Company becomes capable of exercising joint control or significant influence (but not

control) over an investee due to additional investment or other reasons the Company uses the fair value

of the previously-held equity investment together with additional investment cost as the initial

investment cost under the equity method. The difference between the fair value and carrying amount of

the previously-held equity investment and the accumulated changes in fair value included in other

comprehensive income shall be transferred to profit or loss for the current period upon commencement

of the equity method.When the Company can no longer exercise joint control of or significant influence over an investee due

to partial disposal of the equity investment or other reasons the remaining equity investment shall be

accounting for using Accounting Standard for Business Enterprises No. 22 - Recognition and

Measurement of Financial Instruments and the difference between the fair value and the carrying

amount of the remaining equity investment shall be charged to profit or loss for the current period at

the date of the loss of joint control or significant influence. Any other comprehensive income

previously recognised under the equity method shall be accounted for on the same basis as would have

been required if the Company had directly disposed of the related assets or liabilities for the current

period upon discontinuation of the equity method. Other movement of owner’s equity related to

original equity investment is transferred to profit or loss for the current period.When the Company can no longer exercise control over an investee due to partial disposal of the equity

investment or other reasons and the remaining equity after disposal can exercise joint control of or

significant influence over an investee the remaining equity is adjusted as using equity method from

acquisition. When the remaining equity can no longer exercise joint control of or significant influence

over an investee the remaining equity investment shall be accounted for using Accounting Standard for

Business Enterprises No. 22-Recognition and Measurement of Financial Instruments and the

difference between the fair value and the carrying amount of the remaining equity investment shall be

charged to profit or loss for the current period at the date of loss of control.When the Company can no longer exercise control over an investee due to new capital injection by

other investors and the Company can exercise joint control of or significant influence over an investee

the Company recognizes its share of the investee’s new added net assets using new shareholding

percentage. The difference between its new share of the investee’s new added net assets and its

decreased shareholding percentage of the original investment is recognized in profit or loss. And the

Company adjusts to the equity method using the new shareholding percentage as if it uses the equity

method since it obtains the investment.Unrealized internal trading gains and losses between the group and associated enterprises and joint

ventures shall be calculated as part of the group according to the shareholding ratio and investment

gains and losses shall be recognized on an offset basis. However unrealized internal trading losses

between the group and the investee shall not be offset if they are impairment losses of the transferred

assets.

(3) Criteria for determining the existence of joint control or significant influence over an investee

Joint control is the contractually agreed sharing of control of an arrangement which exists only when

decisions about the relevant activities require the unanimous consent of the parties sharing control.When assessing whether the Company can exercise joint control over an investee the Company first

considers whether no single participant party is in a position to control the investee’s related activities

unilaterally and then considers whether strategic decisions relating to the investee’s related activities

require the unanimous consent of all participant parties that sharing of control. All the parties or a

group of the parties control the arrangement collectively when they must act together to direct the

relevant activities. When more than one combination of the parties can control an arrangement

collectively joint control does not exist. A party that holds only protective rights does not have joint

control of the arrangement.Significant influence is the power to participate in the financial and operating policy decisions of an

investee but does not have control or joint control over those policies. When determining whether the

Company can exercise significant influence over an investee the effect of potential voting rights (for

example warrants share options and convertible bonds) held by the Company or other parties that are

currently exercisable or convertible shall be considered.When the Company directly or indirectly through subsidiaries owns 20% of the investee (including

20%) or more but less than 50% of the voting shares it has significant influence over the investee

unless there is clear evidence to show that in this case the Company cannot participate in the

production and business decisions of the investee and cannot form a significant influence. When the

Company owns less than 20% of the voting shares generally it does not have significant influence over

the investee unless there is clear evidence to show that in this case the Company can participate in the

production and business decisions of the investee so as to form a significant influence.

(4) Method of impairment testing and impairment provision

For investments in subsidiaries associates and joint ventures refer to Note V. 32 for the impairment of

assets.

24. Investment property

Investment property measurement method

Cost method

Depreciation or amortization method

Investment properties are properties held either to earn rental income or for capital appreciation or for

both. The Group's investment real estate includes leased houses buildings and leased land use rights. In

addition for a vacant building held by the company for operating lease if the board of directors (or a

similar institution) makes a written resolution expressly indicating that it is used for operating lease and

the intention of holding does not change in the short term it is also considered as Investment property.Investment properties are initially measured at acquisition cost and depreciated or amortized using the

same policy as that for fixed assets or intangible assets.

For the impairment of the investment properties accounted for using the cost model refer to Note V. 32

for the impairment of assets.Gains or losses arising from the sale transfer retirement or disposal of an item of investment property

are determined as the difference among the net disposal proceeds the carrying amount of the item

related taxes and surcharges and are recognised in profit or loss for current period.

25. Fixed assets

(1) Recognition of fixed assets

Fixed assets represent the tangible assets held by the Company for use in production of goods use in

supply of services rental or for administrative purposes with useful lives over one accounting year.

Fixed assets are only recognised when its related economic benefits are likely to flow to the Company

and its cost can be reliably measured. Fixed assets are initially measured at cost.

(2) Depreciation of fixed assets

Category Depreciation method Useful life (years) Residual value rate %

Annual depreciation

rate %

Plant and buildings straight-line method 30 5 3.17%

Motor vehicles straight-line method 6 5 15.83%

Electronic equipment

and others

straight-line method 5 5 19.00%

The cost of a fixed asset is depreciated using the straight-line method since the state of intended use

unless the fixed asset is classified as held for sale. Not considering impairment provision the estimated

useful lives residual value rates and depreciation rates of each class of fixed assets are as follows:

(3) Recognition and measurement of fixed assets acquired under finance leases

Fixed assets under finance leases are recognised if they meet one or more of the following criteria:

①The ownership of leased assets is transferred to the Company by the end of the lease term.②The Company has the option to purchase the asset at a price that is expected to be sufficiently lower

than the fair value at the date of the option becomes exercisable for it to be reasonably certain at the

inception of the lease that the option will be exercised.

③Even if the ownership of assets is not transferred the lease term covers the major part of the useful

life of the asset.

④At the inception of lease the present value of minimum lease payments amount to substantially all of

the fair value of leased asset.⑤Leased assets are of a specialized nature that only the Company can use them without major

modifications.

An asset acquired under a finance lease is measured at an amount equal to the lower of its fair value

and the present value of the minimum lease payments each determined at the inception of the lease.Long-term payable is recorded at an amount equal to the sum of all future minimum lease payments.The difference between the carrying amount of the leased assets and the minimum lease payments is

accounted for as unrecognised finance charges. Initial direct costs attributable to a finance lease

incurred during the process of lease negotiation and the signing of the lease agreement including

service charges attorney's fees travelling expenses and stamp duty that are incurred by the Company

are added to the carrying amount of the leased asset. Unrecognised finance charges are recognised as

finance charge for the period using the effective interest method over the lease term.

Depreciation is accounted for in accordance with the accounting policies of fixed assets. If there is

reasonable certainty that the Company will obtain ownership of a leased asset at the end of the lease

term the leased asset is depreciated over its estimated useful life. Otherwise the leased asset is

depreciated over the shorter of the lease term and its estimated useful life.

(4) Impairment of the fixed assets

For the impairment of the fixed assets please refer to Note V. 32. Impairment of assets

Useful lives estimated residual values and depreciation methods are reviewed at least at each year-end.The Company adjusts the useful lives of fixed assets if their expected useful lives are different with the

original estimates and adjusts the estimated net residual values if they are different from the original

estimates.

(6) Overhaul costs

Overhaul costs occurred in regular inspection are recognized in the cost if there is undoubted evidence

to confirm that this part meets the recognition criteria of fixed assets otherwise the overhaul costs are

recognized in profit or loss for the current period. Depreciation is provided during the period of regular

overhaul.

26. Construction in progress

Construction in progress is recognized based on the actual construction cost including all expenditures

incurred for construction projects capitalized borrowing costs and any other costs directly attributable

to bringing the asset to working condition for its intended use.

Construction in progress is transferred to fixed asset when it is ready for its intended use.

The impairment of construction in progress is set out in Note V. 32. Impairment of assets

27. Borrowing costs

(1) Capitalisation criteria

Borrowing costs that are directly attributable to the acquisition construction or production of a

qualifying asset shall be capitalised as part of the cost of that asset. Other borrowing costs are expensed

in profit or loss as incurred. The capitalisation of borrowing costs shall commence only when the

following criteria are met:

①capital expenditures have been incurred including expenditures that have resulted in payment of

cash transfer of other assets or the assumption of interest-bearing liabilities;

②borrowing costs have been incurred;

③the activities that are necessary to prepare the asset for its intended use or sale have commenced.

(2) Capitalisation period

The capitalisation of borrowing costs ceases when the asset under acquisition or construction becomes

ready for its intended use the borrowing costs incurred thereafter are recognised in profit or loss for the

current period.

Capitalisation of borrowing costs is suspended during periods in which the acquisition or construction

of a fixed asset is interrupted abnormally and the interruption lasts for more than 3 months until the

acquisition or construction is resumed.

(3) Capitalisation rate of borrowing costs and calculation basis of capitalised amount

For interest expense actually incurred on specific borrowings the eligible capitalised amount is the net

amount of the borrowing costs after deducting any investment income earned before some or all of the

funds are used for expenditures on the qualifying asset. To the extent that the Company borrows funds

generally and uses them for the purpose of obtaining a qualifying asset the Company shall determine

the amount of borrowing costs eligible for capitalisation by applying a capitalisation rate to the

expenditures on that asset the capitalisation rate shall be the weighted average of the borrowing costs

applicable to the borrowings of the Company that are outstanding during the period other than

borrowings specifically for the purpose of obtaining a qualifying asset.In the capitalisation period exchange differences of specific borrowings in foreign currency shall be

capitalised; exchange differences of general borrowings in foreign currency is recognised in profit or

loss for the current period.

28. Productive biological assets

Inapplicable

29. Oil and gas assets

Inapplicable

30. Use right assets

Inapplicable

31. Intangible assets

(1) Valuation use life and impairment

Intangible assets include software land use right and patent rights etc.Intangible assets are stated at actual cost upon acquisition and the useful economic lives are determined

at the point of acquisition. When the useful life is finite amortisation method shall reflect the pattern

in which the asset’s economic benefits are expected to be realised. If the pattern cannot be

determined reliably the straight-line method shall be used. An intangible asset with an indefinite useful

life shall not be amortised.The Company shall review the useful life and amortisation method of an intangible asset with a finite

useful life at least at each year end. Changes of useful life and amortisation method shall be

accounted for as a change in accounting estimate.

An intangible asset shall be derecognised in profit or loss when it is not expected to generate future

economic benefits.The impairment of intangible assets is set out in NOTE V.32.Impairment of assets

(2) Accounting policy for internal research and development expenditure

32. Impairment of assets

The impairment of long-term equity investments in subsidiaries associates and joint ventures

investment properties measured using a cost model fixed assets construction in progress productive

biological assets measured using a cost model intangible assets goodwill proven oil and gas mining

rights and wells and related facilities etc. (Excluding inventories investment property measured using

a fair value model deferred tax assets and financial assets) is determined as follows:

At each balance sheet date the Company determines whether there is any indication of impairment. If

any indication exists the recoverable amount of the asset is estimated. In addition the Company

estimates the recoverable amounts of goodwill intangible assets with indefinite useful lives and

intangible assets not ready for use at each year-end irrespective of whether there is any indication of

impairment.The recoverable amount of an asset is the higher of its fair value less costs to sell and its present value

of expected future cash flows. The recoverable amount is estimated for each individual asset. If it is not

possible to estimate the recoverable amount of each individual asset the Company determines the

recoverable amount for the asset group to which the asset belongs. An asset group is the smallest

identifiable group of assets that generates cash inflows that are largely independent of the cash inflows

from other assets or asset groups.

An impairment loss is recognised in profit or loss when the recoverable amount of an asset is less than

it carrying amount. A provision for impairment of the asset is recognised accordingly.

For goodwill impairment test the carrying amount of goodwill arising from a business combination is

allocated reasonably to the relevant asset group since the acquisition date. If the carrying amount of

goodwill is unable to be allocated to asset group the carrying amount of goodwill will be allocated to

asset portfolio. Asset group or portfolio of asset group is asset group or portfolio of asset group which

can be benefit from synergies of a business combination and is not greater than the reportable segment

of the Company.In impairment testing if impairment indication exists in asset group or portfolio of asset group

containing allocated goodwill impairment test is first conducted for asset group or portfolio of asset

group that does not contain goodwill and corresponding recoverable amount is estimated and any

impairment loss is recognized. Then impairment test is conducted for asset group or portfolio of asset

group containing goodwill by comparing it carrying amount and its recoverable amount. If the

recoverable amount is less than the carrying amount impairment loss of goodwill is recognized.Once an impairment loss is recognised it is not reversed in a subsequent period.

33. Long-term deferred expenses

Long-term deferred expenses are recorded at the actual cost and amortized using a straight-line method

within the benefit period. For long-term deferred expense that cannot bring benefit in future period the

Company recognized its amortised cost in profit or loss for the current period.

34. Contractual liabilities

Inapplicable

35. Employee benefits

(1) Scope of employee benefits

Employee benefits refer to all forms of consideration or compensation given by the Company in

exchange for service rendered by employees or for the termination of employment relationship.

Employee benefits include short-term employee benefits post-employment benefits termination

benefits and other long-term employee benefits. Benefits provided to the Company’s spouse children

dependents family members of deceased employees or other beneficiaries are also part of the

employee benefits.In the current period the Company has accrued for the actual wages bonuses medical insurance for

employees based on standard rate work injury insurance and maternity insurance and other social

insurance and housing fund incurred and these are recognised as liabilities and corresponding costs in

the profit or loss. If these liabilities are not expected to be fully paid 12 months after the end of the

reporting period in which employee renders the service to the Company and if the financial impact is

significant these liabilities shall be discounted using the net present value method.

(2) Post-employment benefits

Post-employment benefit plan includes defined contribution plans and defined benefit plans. Defined

contribution plans are post-employment benefit plans under which an enterprise pays fixed

contributions into a separate fund and will have no future obligations to pay the contributions. Defined

benefit plans are post-employment benefit plans other than defined contribution plans.

Defined contribution plans

Defined contribution plans include primary endowment insurance unemployment insurance

corporation pension plan and etc.

Besides basic pension insurance the Company establishes corporate pension plans in accordance with

the related policies of corporate pension regulations. Employees can join the pension plan voluntarily.The Company has no other significant commitment of employees’ social security.The Company shall recognise in the accounting period in which an employee provides service the

contribution payable to a defined contribution plan as a liability with a corresponding charge to the

profit or loss for the current period or the cost of a relevant asset.

Defined benefit plan

For the defined benefit plan independent actuary uses an actuarial technique the projected unit credit

method to make a reliable estimate of the ultimate cost to the entity of the benefit that employees have

earned in return for their service in the current and prior periods on the balance sheet date. The Group

set the defined benefit plan including the following components:

①Service costs including current service costs any past service costs and gain or loss on settlement.

Among them the current service cost is the increase in the present value of the defined benefit

obligation resulting from employee service in the current period; the past service cost is the change in

the present value of the defined benefit obligation for employee service in prior periods resulting from

a plan amendment (the introduction or withdrawal of or changes to a defined benefit plan) or a

curtailment (a significant reduction by the entity in the number of employees covered by a plan).②Net interest on the net defined benefit liability (asset) can be viewed as comprising interest income

on plan assets interest cost on the defined benefit obligation and interest on the effect of the asset

ceiling.③Re-measurements of the net defined benefit liability and assets.The Group makes determining amounts to be recognized in profit or loss except other accounting

standards stipulates or allows employee benefits recorded as asset cost. Re-measurements of the

changes in the net defined benefit liability (asset) recognized in other comprehensive income shall not

be reclassified to profit or loss in a subsequent period. However the entity may transfer those amounts

recognized in other comprehensive income within equity when original defined benefit plan is

terminated.

(3) Termination benefits

The Company provides for termination benefits to the employees and shall recognize an employee

benefits liability for termination benefits with a corresponding charge to the profit or loss for the

current period at the earlier of the following dates: When the Company cannot unilaterally withdraw

the offer of the termination benefits from an employment termination plan or a redundancy proposal;

the Company recognizes the costs or expenses relating to a restructuring that involves the payment of

the termination benefits..If an employee's internal retirement plan is implemented the economic compensation before the

official retirement date is a dismissal benefit. From the date when the employee stops providing

services to the normal retirement date the salary of the retired employee and the social insurance

premium to be paid are included in the current period at one time profit and loss. Financial

compensation after the official retirement date (such as a normal retirement pension) is treated as

after-service benefits.(5) Other long-term employee benefits

Other long-term employee benefits provided by the Company to the employees satisfied the conditions

for classifying as a defined contribution plan; those benefits shall be accounted for in accordance with

the above requirements relating to defined contribution plan. When the benefits satisfy a defined

benefit plan it shall be accounted for in accordance with the above requirements relating to defined

benefit plan but the movement of net liabilities or assets in re-measurement of defined benefit plan

shall be recorded in profit or loss for the current period or cost of relevant assets.

36. Lease liability

Inapplicable

37. Provisions

A provision is recognised for an obligation related to a contingency if all the following conditions are

satisfied:

(1) the Company has a present obligation;

(2) it is probable that an outflow of economic benefits will be required to settle the obligation;

(3) the amount of the obligation can be estimated reliably.

A provision is initially measured at the best estimate of the expenditure required to settle the related

present obligation. Factors pertaining to a contingency such as the risks uncertainties and time value of

money are taken into account as a whole in reaching the best estimate. Where the effect of the time

value of money is material provisions are determined by discounting the expected future cash flows.The Company reviews the carrying amount of a provision at the balance sheet date and adjusts the

carrying amount to the current best estimate.If all or part of the expenditure necessary for settling the provision is expected to be compensated by a

third party the amount of compensation is separately recognized as an asset when it is basically certain

to be received. The recognized compensation amount shall not exceed the carrying amount of the

provision.

38. Share-based payment

Inapplicable

39. Other financial instruments such as preferred shares perpetual liabilities etc.

Inapplicable

40. Revenue

The accounting policy used for revenue recognition and measurement

(1) General principle

The Company recognizes revenue when it has satisfied the performance obligation under the contract

that is when the customer has obtained the right to control the relevant goods or services.If a contract contains two or more performance obligations the Company shall allocate the transaction

price to each individual performance obligation in accordance with the relative proportion of the

stand-alone selling price of the goods or services promised by each individual performance obligation

on the date of the contract The Company measures revenue based on the transaction price allocated to

each individual performance obligation.When one of the following conditions is met the Group shall perform its performance obligations

within a certain period; otherwise it shall perform its performance obligations at a certain point in

time:

① A customer obtains and consumes the economic benefits brought by the Company's performance at

the same time as the Company's performance.

② A customer may control the products under construction in the Company's performance process.

③ The goods produced by the Company during the performance of the contract have irreplaceable

uses and the Company has the right to collect payment for the cumulative performance part that

has been completed so far during the entire contract period.

For performance obligations performed within a certain period of time the Company recognizes

revenue in accordance with the performance progress during that period except where the performance

progress cannot be reasonably determined. The Company determines the progress of a contract by

using the output method or input method with consideration of the nature of goods or services. When

the performance progress cannot be reasonably determined and the costs incurred are expected to be

compensable the Company recognizes the revenue according to the amount of the costs incurred until

the performance progress can be reasonably determined.

For performance obligations performed at a certain point of time the Company recognizes revenue at

the point when a customer obtains control of the relevant goods or services. In judging whether a

customer has obtained control of goods or services the Company considers the following signs:

① The Company has the current right to receive payment for the goods or services that is the

customer has the current payment obligation for the goods or services.② The Company has transferred the legal ownership of the product to the customer that is the

customer has the legal ownership of the product.③ The Company has transferred the goods to the customer in kind that is the customer has taken

possession of the goods in kind.④ The Company has transferred the main risks and rewards of the ownership of the goods to the

customer that is the customer has obtained the main risks and rewards of the ownership of the

goods

⑤ The customer has accepted the goods or services etc.⑥ Other signs that the customer has obtained control of the product.The Group has transferred goods or services to customers and has the right to receive consideration

(and the right depends on other factors other than the passage of time) as contractual assets and

contractual assets are impaired on the basis of expected credit losses (see Note V 10 (6)) The Group's

unconditional (only depending on the passage of time) right to receive consideration from customers

are listed as receivables. The Group’s obligation to transfer goods or services to customers for

consideration received or receivable from customers is regarded as contractual liabilities.

Contractual assets and contractual liabilities under the same contract are listed as net amount. If the net

amount is the debit balance it is listed in the " contractual assets " or "other non-current assets" item

according to its liquidity; if the net amount is the credit balance according to its liquidity it is listed in

the items of " contractual liabilities " or "other non-current liabilities".

(2) Specific revenue recognition

Specific revenue recognition is as follows:

①Real estate development sales revenue recognition

1) the sales contract has been signed and filed with the land department; 2) the real estate has been

completed and accepted; 3) For a lump-sum payment all the room payment has been received for

installment payments if the delayed payment has a financing nature it shall be calculated and

determined in accordance with the present value of the contract price for mortgage the first

installment has been received and the bank mortgage approval procedures have been completed; 4)

completed the procedures for entering the partnership in accordance with the requirements stipulated in

the sales contract.②Provide the specific method of property service income recognition

According to the service date agreed in the property service contract and agreement and the area and

unit price corresponding to the service the realization of the property service income shall be

confirmed when the relevant service fee has been received or evidence of payment has been obtained.③Rental property income recognition of the specific method

The realization of the income from the leased property shall be confirmed when the relevant rent has

been received or evidence of collection has been obtained according to the lease contract and

agreement on the date of lease (consider the rent-free period if there is a rent-free period) and the rent

amount.④Other income recognition methods

Including project construction income hotel operating income etc. according to the relevant contract

agreement in the relevant payment has been received or is likely to receive the realization of revenue

recognition.There are differences in revenue recognition due to different business models in the same businesses

41. Government grants

A government grant is recognised when there is reasonable assurance that the grant will be received

and that the Group will comply with the conditions attaching to the grant.If a government grant is in the form of a transfer of a monetary asset it is measured at the amount

received or receivable. If a government grant is in the form of a transfer of a non-monetary asset it is

measured at fair value. If fair value cannot be reliably determined it is measured at a nominal amount

of RMB 1.The government grants relating to assets are grants that Group purchases construction or other

methods to acquire long-term assets of government grants. Exception of the above grants others are

related to gains.

For government grants with unspecified purpose the amount of grants used to form a long-term asset is

regarded as government grants related to an asset the remaining amount of grants is regarded as

government grants related to income. If it is not possible to distinguish the amount of grants is treated

as government grants related to income.

A government grant related to an asset is offset against the carrying amount of the related asset or

recognised as deferred income and amortised to profit or loss over the useful life of the related asset on

a reasonable and systematic manner. A grant that compensates the Group for expenses or losses already

incurred is recognised in profit or loss or offset against related expenses directly. A grant that

compensates the Group for expenses or losses to be incurred in the future is recognised as deferred

income and included in profit or loss or offset against related expenses in the periods in which the

expenses or losses are recognised.

A grant related to ordinary activities is recognised as other income or offset against related expenses

based on the economic substance. A grant not related to ordinary activities is recognised as

non-operating income.When a recognised government grant is reversed carrying amount of the related asset is adjusted if the

grant was initially recognized as offset against the carrying amount of the related asset. If there is

balance of relevant deferred income it is offset against the carrying amount of relevant deferred

income. Any excess of the reversal to the carrying amount of deferred income is recognised in profit or

loss for the current period. For other circumstances reversal is directly recognized in profit or loss for

the current period.42. Deferred tax assets and deferred tax liabilities

Income tax comprises of current tax and deferred tax. Current tax and deferred tax are recognised in

profit or loss except to the extent that they relate to transactions or items recognised directly in equity

and goodwill arising from a business combination.

Deferred tax assets and deferred tax liabilities arise from deductible and taxable temporary differences

respectively being the differences between the carrying amounts of assets and liabilities for financial

reporting purposes and their tax bases.

All the taxable temporary differences are recognized as deferred tax liabilities except for those incurred

in the following transactions:

(1) initial recognition of goodwill or assets or liabilities in a transaction that is not a business

combination and that affects neither accounting profit nor taxable profit (or deductible loss);

(2) taxable temporary differences associated with investments in subsidiaries associates and joint

ventures and the Company is able to control the timing of the reversal of the temporary difference and

it is probable that the temporary difference will not reverse in the foreseeable future.The Company recognises a deferred tax asset for deductible temporary differences deductible losses

and tax credits carried forward to subsequent periods to the extent that it is probable that future taxable

profits will be available against which deductible temporary differences deductible losses and tax

credits can be utilised except for those incurred in the following transactions:

(1) a transaction that is not a business combination and that affects neither accounting profit nor

taxable profit (or deductible loss);

(2) deductible temporary differences associated with investments in subsidiaries associates and joint

ventures the corresponding deferred tax asset is recognized when both of the following conditions are

satisfied: it is probable that the temporary difference will reverse in the foreseeable future; and it is

probable that taxable profits will be available in the future against which the temporary difference can

be utilized.

At the balance sheet date deferred tax is measured based on the tax consequences that would follow

from the expected manner of recovery or settlement of the carrying amount of the assets and liabilities

using tax rates enacted at the reporting date that are expected to be applied in the period when the asset

is recovered or the liability is settled.The carrying amount of a deferred tax asset is reviewed at each balance sheet date and is reduced to

the extent that it is no longer probable that the related tax benefits will be utilised. Such reduction is

reversed to the extent that it becomes probable that sufficient taxable profits will be available.43. Operating leases and finance leases

(1) Accounting treatments for operating lease

The Group recognizes leases that a lease has substantially transferred all risks and rewards incidental to

ownership of a leased asset to the lessee as financial leases. An operating lease is a lease other than a

finance lease.Rental payments under operating leases are recognized as part of the cost of another related asset or as

expenses on a straight-line basis over the lease term. Initial direct costs are charged to profit or loss

immediately.

(2) Accounting treatment method for finance lease

At the commencement of the lease term the Company 110ecognized the aggregate of the minimum

lease receipts determined at the inception of a lease and the initial direct costs as finance lease

receivable and 110ecognized unguaranteed residual value at the same time. The difference between

the aggregate of the minimum lease receipts the initial direct costs and the unguaranteed residual value

and the aggregate of their present value is 110ecognized as unearned finance income. Unearned

finance income is allocated to each accounting period during the lease term using the effective interest

method.When the Company acquires an asset under a finance lease the asset is measured at an amount equal to

the lower of its fair value and the present value of the minimum lease payments each determined at the

inception of the lease. At the commencement of the lease term the minimum lease payments are

recorded as long-term payables. The difference between the carrying amount of the leased assets and

the minimum lease payments is accounted for as 110ecognized110d finance charges. Initial direct

costs attributable to a finance lease that are incurred by the Company are added to the carrying amount

of the leased asset. Unrecognised finance charges arising from a finance lease are 110ecognized using

an effective interest method over the lease term. Depreciation is accounted for in accordance with the

accounting policies of fixed assets.

44. Other significant accounting policies and accounting estimates

Estimates as well as underlying assumptions involved are reviewed on an ongoing basis based on

historical experience and other factors including reasonableness of estimation about future events.The followings are significant accounting estimations and key assumptions that have a significant risk

of causing a material adjustment to the carrying amount of assets and liabilities within the next

financial year.

Classification of financial assets

The Group’s major judgments in determining the classification of financial assets include the analysis

of business models and the characteristics of contract cash flows.

At the level of financial asset group the Group determines the business model for managing financial

assets taking into account factors such as the way to evaluate and report financial assets performance

to key managers the risks affecting financial assets performance and their management methods and

the way in which relevant business managers are paid.In assessing whether the contract cash flow of financial assets is consistent with the basic lending

arrangements the Group has the following judgments: whether the principal’s time distribution or

amount may change during the lifetime for early repayment and other reasons; whether the interest

only includes the time value of money credit risk other basic lending risks and the consideration of

cost and profit. For example does the amount of advance payment only reflect the unpaid principal and

interest based on the unpaid principal and reasonable compensation paid for the early termination of

the contract.Measurement of Expected Credit Loss of Account Receivable

The Group calculates the expected credit losses of accounts receivable by default risk exposure and

expected credit losses rate of accounts receivable and determines the expected credit losses rate based

on default probability and default loss rate. In determining the expected credit losses rate the Group

uses internal historical credit loss and other data and adjusts the historical data with current situation

and forward-looking information. In considering forward-looking information the indicators used by

the Group include the risks of economic downturn external market environment technological

environment and changes in customer conditions. The Group regularly monitors and reviews

assumptions related to the calculation of expected credit losses.

Deferred tax assets

Deferred tax assets relating to certain temporary differences and tax losses are recognised as

management considers it is probable that future taxable profit will be available against which the

temporary differences or tax losses can be utilised. The management needs significant judgment to

estimate the time and extent of the future taxable profits and tax planning strategy to recognise the

appropriate amount of Deferred tax assets

The provision of land appreciation tax

The Group is subject to land appreciation tax (“LAT”). The Group recognised LAT based on

management’s best estimates however LAT is recognised by tax authorities according to the

interpretation of the tax rules. The final tax outcome could be different from the amounts that were

initially recorded and these differences will impact tax provision in periods in which such taxes have

been finalised with local tax authorities.

Determination of fair value of unlisted equity investment

The fair value of an unlisted equity investment is the future cash flow discounted from the current

discount rate of a project with similar terms and risks. This valuation requires the group to estimate

future cash flows and discount rates. Therefore it causes high uncertainty. In some cases there is

insufficient information to determine fair value or the distribution of possible estimates is wide. On the

contrary the cost represents the best estimate of fair value within that range. As a whole the cost can

represent the appropriate estimate of fair value within that range.

45.Changes in significant accounting policies accounting estimates and correction of errors in

prior periods

(1) Changes in accounting policies.

√ Applicable □ Inapplicable

On July 5 2017 the Ministry of Finance revised and issued the "Accounting Standards for Enterprises

No.14-Revenue". According to the required of the Ministry of Finance the group implemented the

above new standard and changed the accounting policy from January 1 2020 the main conditions as

follows.The Company recognizes revenue when it has satisfied the performance obligation under the contractthat is when the customer has obtained the right to control the relevant goods or services “Obtainingthe right to control the relevant goods or services” means that it is able to dominate the use of the goods

or services and derive almost all economic benefits therefrom. When certain conditions are met the

Group shall perform its performance obligations within a certain period of time; otherwise it shall

perform its performance obligations at a certain point in time. If a contract contains two or more

performance obligations the company shall allocate the transaction price to each individual

performance obligation in accordance with the relative proportion of the stand-alone selling price of the

goods or services promised by each individual performance obligation on the date of the contract The

Company measures revenue based on the transaction price allocated to each individual performance

obligation.The group adjusted relevant accounting policies in accordance with the specific provisions of the new

revenue standards on specific matters or transactions for example: contractual cost quality assurance

distinction between principal and agent sales with sales return clauses additional purchase options

intellectual property license repurchase arrangement advances from customers and handling of initial

fee without refund etc.The Group has the right to receive consideration by transferring goods to customers and this right

depends on factors other than the passage of time as contractual assets. The Group’s obligation to

transfer goods to customers for consideration received or receivable from customers is listed as

contractual liabilities.Reclassify the tax-exclusive part of the " advance form customers" that should have the delivery

obligation to the customer to contractual liabilities and reclassify the tax part to tax payable. The

company will adjust the retained earnings at the beginning of the year and the amount of other related

items in the financial statements based on the cumulative impact of the first implementation of the new

income standard when preparing the financial reports for 2020 and each period and will not adjust the

information for the comparable period. Please refer the table below

Item Dec 31 2019 Jan 1 2020 Adjusted amount

Advance form

customers

159482510.43 4864243.00 -154618267.43

contractual

liabilities

151007450.32 151007450.32

Tax payable 585700815.36 589311632.47 3610817.11

(2) Changes in significant accounting estimates

□ applicable √ applicable

(3) Adjustment of the relevant financial statements at the current year beginning according to

the new standards for revenues and the new standards for lease initially implemented

commencing from 2020

Whether to adjust the balance sheet account at the beginning of the year

√ Yes □ No

Consolidated balance sheet

Expressed in RMB

Item Dec 31 2019 Jan 1 2020

Adjusted

amount

Current assets:

Cash at bank and on hand 2511140445.35 2511140445.35

Provision of Settlement fund

Funds lent

Financial assets at fair value through profit

or loss

Derivative financial assets

Notes receivable

Accounts receivable 62059055.68 62059055.68

Accounts receivable financing

Prepayments 219948.17 219948.17

Insurance premiums receivables

Cession premiums receivables

Provision of cession premiums receivables

Other receivables 28275228.26 28275228.26

Including: Interest receivable

Dividends receivable 1052192.76 1052192.76

Recoursable Financial assets acquried

Inventories 1462229048.18 1462229048.18

Contractual assets

Assets held for sale

Non-current assets due within one year

Other current assets 102781855.48 102781855.48

Total current assets 4166705581.12 4166705581.12

Non-current assets:

Loans and payments

Investments in debt obligations

Investments in other debt obligations

Long-term receivables

Long-term equity investments 469838.65 469838.65

Investments in other equity

instruments

33126730.04 33126730.04

Other non-current financial assets

Investment property 632241900.20 632241900.20

Fixed assets 30522035.11 30522035.11

Construction in progress

Productive living assets

Oil and gas assets

Use rights assets

Intangible assets

Development costs

Goodwill

Long-term prepaid expense 162125.72 162125.72

Deferred tax assets 46441325.25 46441325.25

Other non-current assets

Total non-current assets 742963954.97 742963954.97

Total assets 4909669536.09 4909669536.09

Current liabilities:

Short-term loans 51647260.17 51647260.17

Borrowings from central bank

Deposit funds

Financial liabilities at fair value through

profit or loss

Derivative financial liabilities

Notes payable

Accounts payable 244224478.46 244224478.46

Advances from customers 159482510.43 4864243.00 -154618267.43

Contractual liabilities 151007450.32 151007450.32

Funds fromsale of financial assets with

repurchasement agreements

Deposits from customer and interbank

Funds received as an agent of stock

exchange

Funds received as stock underwrite

Payroll payable 53909576.49 53909576.49

Taxes payable 585700815.36 589311632.47 3610817.11

Other payables 277319174.53 277319174.53

Including: Interest payable 16535277.94 16535277.94

Dividends payable

Handling charges and commissions

payable

Cession premiums payables

Liabilities held for sale

Non-current liabilities due within one year

Other current liabilities

Total current liabilities 1372283815.44 1372283815.44

Non-current liabilities:

Provision for insurance contracts

Long-term loans

Debentures payable

Including: Preferred shares

Perpetual bonds

Lease liabilities

Long-term payables 7499192.92 7499192.92

Long-term employee benefits payable

Provisions

Deferred income

Deferred tax liabilities 4903293.58 4903293.58

Other non-current liabilities

Total non-current liabilities 12402486.50 12402486.50

Total liabilities 1384686301.94 1384686301.94

Shareholders' equity:

Share capital 1011660000.00 1011660000.00

Other equity instruments

Including: Preferred shares

Perpetual bonds

Capital reserves 978244910.11 978244910.11

Less: treasury shares

Other comprehensive income 20831004.13 20831004.13

Specific reserve

Surplus reserves 191222838.94 191222838.94

General reserve

Retained earnings 1464915816.81 1464915816.81

Total equity attributable to shareholders of the

Company

3666874569.99 3666874569.99

Non-controlling interests -141891335.84 -141891335.84

Total shareholders' equity 3524983234.15 3524983234.15

Total liabilities and shareholders' equity 4909669536.09 4909669536.09

Adjustment description:

The company adjusted according to the actual situation as: Reclassifing the tax-exclusive part of "advance form customers" that should have the delivery obligation to the customer into “contractualliabilities” and reclassifing the part for tax to tax payable.The new revenue standard takes the transfer of control as revenue recognition and there is no

significant change in the company’s revenue recognition.Parent Company Balance Sheet

Expressed in RMB

Item Dec 31 2019 Jan 1 2020 Adjust amount

Currently assets:

Cash at bank and on

hand

1967688122.55 1967688122.55

Financial assets at

fair value through profit or

loss

Derivative financial

assets

Notes receivable

Accounts receivable 156935.84 156935.84

Accounts receivable

financing

Prepayments 200000.00 200000.00

Other receivables 835275498.69 835275498.69

Including: Interest

receivable

Dividends

receivable

Inventories 419453091.86 419453091.86

Contractual assets

Assets held for sale

Non-current assets

due within one year

Other current assets 407560.64 407560.64

Total current assets 3223181209.58 3223181209.58

Non-current assets:

Loans and payments

Investments in other

debt obligations

Long-term

receivables

Long-term equity

investments

150676516.92 150676516.92

Investments in other

equity instruments

13229501.03 13229501.03

Other non-current

financial assets

Investment property 522038731.16 522038731.16

Fixed assets 19586720.47 19586720.47

Construction in

progress

Productive living

assets

Oil and gas assets

Use rights assets

Intangible assets

Development costs

Goodwill

Long-term prepaid

expense

Deferred tax assets 162125.72 162125.72

Other non-current

assets

20975294.54 20975294.54

Total non-current assets 726668889.84 726668889.84

Total assets 3949850099.42 3949850099.42

Current liabilities:

Short-term loans

Financial liabilities at

fair value through profit or

loss

Derivative financial

liabilities

Notes payable

Accounts payable 103915931.14 103915931.14

Advances from

customers

59409454.38 -59409454.38

Contractual liabilities 56580432.74 56580432.74

Payroll payable 25544403.23 25544403.23

Taxes payable 143434273.95 146263295.59 2829021.64

Other payables 190666487.82 190666487.82

Including: Interest

payable

16535277.94 16535277.94

Dividends

payable

Liabilities held for

sale

Non-current

liabilities due within one

year

Other current

liabilities

Total current liabilities 522970550.52 522970550.52

Non-current liabilities:

Long-term loans

Debentures payable

Including:

Preferred shares

Perpetual

bonds

Lease liabilities

Long-term payables

Long-term employee

benefits payable

Provisions

Deferred income

Deferred tax

liabilities

1295046.51 1295046.51

Other non-current

liabilities

Total non-current

liabilities

1295046.51 1295046.51

Total liabilities 524265597.03 524265597.03

Owners’ equity:

Share capital 1011660000.00 1011660000.00

Other equity

instruments

Including:

Preferred shares

Perpetual

bonds

Capital reserves 964711931.13 964711931.13

Less: Treasury shares

Other comprehensive

income

922125.77 922125.77

Specific reserve

Surplus reserves 168093225.53 168093225.53

Retained earnings 1280197219.96 1280197219.96

Total shareholders’ equity 3425584502.39 3425584502.39

Total liabilities and

shareholders’ equity

3949850099.42 3949850099.42

Adjustment description:

According to the company's revenue recognition After the company adopts the "New Revenue

Standard" no " contractual assets" will be formed; the impact of financial statement mainly is the

reclassification between " contractual liabilities" "advance in customers" and "taxes payable".

(4) Note to the retroactive adjustment of the previous comparative data according to the new

standards for revenue and the new standards for lease to be implemented commencing from year

2020

□ applicable √ Inapplicable

46. Other

Inapplicable

VI. Taxation

1. Main types of taxes and corresponding tax rates

Tax type Tax basis Tax rate%

VAT Taxable income 9653

City maintenance and construction tax Turnover tax payable 7

Corporate income tax Taxable profits 2516.5

Land appreciation tax

It shall be levied on the basis of the

value-added value of the real estate

transferred and the prescribed tax rate

and paid in advance according to the

type of real estate product

Four progressive rates of excess rate:

304050 60

Property tax 70% of the original value of properties 1.2

Education surcharge Turnover tax payable 3

Local education surcharge Turnover tax payable 2

In case there were taxpayers subject to different corporate income tax rates disclose the information：

Inapplicable

2. Tax Preferences

Inapplicable

3. Others

The corporate income tax rate for companies registered in China is 25% and the corporate income tax

rate for companies registered in Hong Kong is 16.5%.VII. Notes to items of consolidated financial statements

1. Cash at bank and on hand

Expressed in RMB

Item As at June 30 2020 As at Dec 31 2019

Cash in hand 68146.22 66252.42

Deposits with banks： 426154287.65 1493123507.93

Other Monetary Funds 1722000000.00 1017950685.00

Total 2148222433.87 2511140445.35

Including: Total overseas deposits 8100588.74 7936545.69

Note: At the end of the period other monetary assets 1722000000.00 are “seven-day notice deposits”

2. Transactional financial assets

Inapplicable

3. Derivative financial assets

Inapplicable

4. Notes receivable

Inapplicable

5. Accounts receivable

(1) Accounts receivables disclosed by category

Expressed in RMB

Item

As at June 30 2020 As at Dec 31 2019

Book balance Provision for Carryin Book balance Provision for bad Carrying

bad and

doubtful debts

g

amount

and doubtful

debts

amount

Amount

Proporti

on

Amount

Provisio

n

proporti

on

Amount

Proporti

on

Amount

Provisio

n

proporti

on

Individually

assessed for

impairment

individually

248669

00.27

32.09%

248669

00.27

100.00

%

0.00

248669

00.27

27.56%

248669

00.27

100.00% 0.00

Including:

Collectively

assessed for

impairment based

on credit risk

characteristics

526338

93.57

67.91%

329246

0.67

6.26%

493414

32.90

653515

16.35

72.44%

329246

0.67

5.04%

6205905

5.68

Including:

Receivable from

other customers

526338

93.57

67.91%

329246

0.67

6.26%

493414

32.90

653515

16.35

72.44%

329246

0.67

5.04%

6205905

5.68

Total

775007

93.84

100.00

%

281593

60.94

36.33%

493414

32.90

902184

16.62

100.00%

281593

60.94

31.21%

6205905

5.68

A. Provision for bad and doubtful debts for accounts receivable which are individually assessed for

impairment individually:

Expressed in RMB

Item

As at June 30 2020

Book balance

Provision for bad

and doubtful debts

Provision proportion Provision reason

Agent for import and

export business

payment

11574556.00 11574556.00 100.00%

Expected to be

unrecoverable

Long-term receivable

of selling properties

10626436.84 10626436.84 100.00%

Expected to be

unrecoverable

Accounts receivable

from the revoked

subsidiary

2328158.40 2328158.40 100.00%

Expected to be

unrecoverable

Other client receivable 337749.03 337749.03 100.00%

Expected to be

unrecoverable

Total 24866900.27 24866900.27 -- --

A. Provision for bad and doubtful debts for accounts receivable which are individually assessed for

impairment individually:

Expressed in RMB

Item

As at June 30 2020

Book balance

Provision for bad

and doubtful debts

Provision proportion Provision reason

Accounts receivable which are collectively assessed for impairment using the aging analysis method

(Receivable from other customers group) at the end of the period:

Expressed

in RMB

Item

As at June 30 2020

Book balance

Provision for bad and

doubtful debts

Provision proportion

Within 1 year 52567375.57 3289134.77 5.04%

1 to 2 years 66518.00 3325.90 5.00%

Total 52633893.57 3292460.67 --

Note to the basis for determining the combination:

Inapplicable

Total provision for bad and doubtful debts based on portfolio:

Inapplicable

Note to the basis for determining the combination:

Inapplicable

Disclosure by aging

Expressed in RMB

Aging As at June 30 2020

Within 1 year 33383469.47

Over 3 years 44117324.37

3 to 4 years 24956115.96

Over 5 years 19161208.41

Total 77500793.84

(2) Additions recoveries or reversals of provision for bad and doubtful debts during the

reporting period

Inapplicable

(3) Accounts receivable written off during this period

Inapplicable

(4) the top five balance of accounts receivable at the ending

Expressed in RMB

Item Ending balance

Proportion in total ending

balance

Ending balance of the

provision for bad debts

China Construction

Third Bureau Group

Co. Ltd.

18581256.93 23.98% 929062.85

Wuhan Linyun Real

Estate Development

Co. Ltd.

13209585.96 17.04% 660479.30

Jiangsu Huajian

Construction Co. Ltd.

Shenzhen Branch

8147885.22 10.51% 407394.26

China Construction

Eighth Engineering

Bureau Co. Ltd.

4555820.56 5.88% 227791.03

Liu Zihua 28308470.82 36.53% 1415423.54

Total 72803019.49 93.94%

(5) Derecognition of accounts receivable due to transfer of financial assets

Inapplicable

(6) Amount of assets and liabilities formed through transfer of account receivable

At the end of the period the Group handled the factoring of accounts receivable. The factoring amount

was RMB 45904965.19 and the corresponding book value of accounts receivable was RMB

45904965.19 which was not derecognized. For details of the pledge of accounts receivable please

refer to Note VII. 81 "Ownership or Use Assets with restricted rights".

6. Accounts Receivable Financing

Inapplicable

7. Prepayments

(1) the aging analysis of prepayments is as follows:

Expressed in RMB

Aging

As at June 30 2020 As at Dec 31 2019

Amount Proportion (%) Amount Proportion (%)

Within 1 year 3454983.53 94.51% 19398.17 8.82%

1 and 2 years 200000.00 5.47% 200000.00 90.93%

More than 3 years 550.00 0.02% 550.00 0.25%

Total 3655533.53 -- 219948.17 --

Note to the reason why a significant prepayment with age exceeding 1 year not been settled:

Inapplicable

(2) Top 5 entities with the largest balances of prepayment

The total amount of prepayment is RMB3148820.81 accounting for 86.14% of the total amount of

the ending balance of prepayment.Other note:

Inapplicable

8. Other receivables

Expressed in RMB

Item As at June 30 2020 As at Dec 31 2019

Dividend receivables 1052192.76 1052192.76

Other receivables 20855240.72 27223035.50

Total 21907433.48 28275228.26

(1) Interest receivables

1) Classification of interest receivable

Inapplicable

2) Significant overdue interest

Inapplicable

3) Provision for bad debts

Inapplicable

(2) Dividends receivable

1) Classification of dividends receivable

Expressed in RMB

Item As at June 30 2020 As at Dec 31 2019

Yunnan KunPeng Flight service Co.Ltd

1052192.76 1052192.76

Total 1052192.76 1052192.76

2) significant dividends receivable aging over 1 year:

Expressed in RMB

Item As at June 30 2020 Aging

Reason why uncolle

cted

Any impairment an

d the basis

Yunnan KunPeng

Flight service Co. Ltd

1052192.76 5 years Delay to issue No

Total 1052192.76 -- -- --

3) Provision for bad debts

Inapplicable

(3) Other receivables

1) Other receivables categorized by nature

Expressed in RMB

Item As at June 30 2020 As at Dec 31 2019

Other receivables from government 3687234.61 4371247.34

Other receivables from employee’s

petty cash

721884.01 716684.01

Other receivables from the collecting

and paying on behalf

595286.34 594012.08

Other receivables from other

customers

56715709.87 56713292.62

Other receivables from related parties 144838546.96 160190001.38

Total 206558661.79 222585237.43

2) Provision for bad and doubtful debts

Expressed in RMB

Item

The first stage The second stage The third stage

Total To 12-month

expected credit

loss

To lifetime expected

credit loss (no credit

impairment)

To lifetime expected

credit loss (has

occurred credit

impairment)

Balance as at Jan 1

2020

1133741.68 194228460.25 195362201.93

Balance as at Jan 1

2020 in current period

—— —— —— ——

Other changes -10710973.62 -10710973.62

Balance as at June 30

2020

1133741.68 183517486.63 184651228.31

Changes in the book balance with significant changes in the loss provision for the current period:

Inapplicable

Other receivables by aging

Expressed in RMB

Item As at Jun 30 2020

Within 1 year 20271255.02

1 to 2 years 5424624.80

Over 3 years 180862781.97

4 to 5 years 180862781.97

Total 206558661.79

3) Additions recoveries or reversals of provision for bad and doubtful debts during the year:

Provision for bad debts in the current period:

Expressed in RMB

Item

As at Dec 31

2019

Change in current period

As at Jun 30

2020 additions

recoveries or

reversals

Write-off Others

Foreign

currency

statement

translation

difference

195362201.93 -10710973.62 184651228.31

Total 195362201.93 -10710973.62 184651228.31

Note: The provision for bad debts for the current period decreased by RMB 10710973.62 which is

the translation difference of foreign currency statements.Including significant recoveries or reversals during the year:

Inapplicable

4) Other receivables written off during this year

Inapplicable

5) Top 5 entities with the largest balances of other receivables

Expressed in RMB

Item Nature Amount Aging

Proportion of the

amount to the

total OR (%)

Bad debt

provision

Canada Great Wall

(Vancouver) Co.Ltd

Current account

89035748.07

More than 5 years

43.10% 89035748.07

Paklid Limited Current account 19319864.85 More than 5 years 9.35% 19319864.85

Bekaton property

Limited

Current account

12559290.58

More than 5 years

6.08% 12559290.58

Guangdong

province Huizhou

Luofu Hill Mineral

Water Co. Ltd

Current account

10465168.81

More than 5 years

5.07% 10465168.81

Xi’an Fresh Peak

Property Trading

Co. Ltd

Current account

8419205.19

More than 5 years

4.08% 8419205.19

Total -- 139799277.50 -- 67.68% 139799277.50

6) Accounts receivable involving government subsidy

Inapplicable

7) Other receivables with recognition terminated due to transfer of financial assets

Inapplicable

8) Amount of assets and liabilities formed through transfer of account receivable and continuing

to be involved

Inapplicable

9. Inventories

Does the Company need to comply with the disclosure requirements of real estate industry

Yes

(1) Classification of inventories

The company complies with the disclosure requirements of "Shenzhen Stock Exchange Industry

Information Disclosure Guidelines No. 3-Listed Companies Engaged in Real Estate Business"

Classified by nature:

Expressed in RMB

Item

As at June 30 2020 As at Dec 31 2019

Book value

Provision

for

impairme

nt of

inventorie

s

Carrying

amount

Book value

Provision

for

impairme

nt of

inventorie

s

Carrying amount

Real estate

developing cost

431446135.98 431446135.98 400425673.85 400425673.85

Real estate

developed

products

922129810.03 268941.60 921860868.43 1060130671.64 268941.60 1059861730.04

Raw materials 1083812.12 240000.00 843812.12 882857.81 240000.00 642857.81

Finished

products

358038.92 38891.91 319147.01 317200.81 38891.91 278308.90

Construction in

progress

81480891.69 81480891.69 1020477.58 1020477.58

Total 1436498688.74 547833.51

1435950855.2

3

1462776881.69 547833.51 1462229048.18

The main items of " Real estate developing cost " and their interest capitalization are shown below:

Expressed in RMB

Item

Starting

time

Finished

time

Estimated total

investment

As at Dec 31

2019

Less: Transfer to“Real estatedevelopedproducts”

Less:

Other

reduction

Add:

Increase

in this

period

As at Jun 30

2020

Cumulative

interest

capitalization

Include:

Amount of

interest

capitalized in

the current

period

Sources

of funds

TianYue

Bay No.2

Sep 1

2019

Sep 12

2020

654850000.00 375133765.74 31020462.13 406154227.87 Others

ShanTou

Fresh Peak

Building

25291908.11 25291908.11 Others

Total -- -- 654850000.00 400425673.85 31020462.13 431446135.98 --

The main items of " Real estate developed products" and their interest capitalization are shown below:

Expressed in RMB

Item Finished time As at Dec 31 2019 Increase Decrease As at Jun 30 2020

Cumulative interest

capitalization

Include: Amount of

interest capitalized

in the current

period

Jinye Island Multi-tier

villa

Sep 16 1997 39127219.14 39127219.14

Jinye Island villa No.10 Dec 02 2010 3527928.93 1446263.78 2081665.15

Jinye Island villa No.11 Aug 20 2008 4341162.49 55252.56 4285909.93

YueJing dongfang

Project

Nov 18 2014 7846006.07 118459.23 7727546.84

Wenjin Garden 92212.77 92212.77

HuaFeng Building 1631743.64 1631743.64

HuangPu XinCun 729430.00 729430.00

XingHu Garden 156848.69 156848.69

Shenfang Shanglin

Garden

Jan 01 2014 10206656.46 10206656.46 820623.32

Beijing Fresh Peak

Buliding

304557.05 304557.05

TianYue Bay No.1 Dec 15 2017 475748123.14 59486914.47 416261208.67

Shengfang CuiLin

Building

May 8 2018 99946066.54 25889031.08 74057035.46

Chuanqi Donghu Dec 18 2019 416472716.72 51004940.49 365467776.23 2412880.86

Total -- 1060130671.64 0.00 138000861.61 922129810.03 3233504.18The main items of " Raw material " Finished products "and “Construction in progress" are shown below:Inapplicable

(2) Provision for impairment of inventories or provision for impairment of contract performance

costs

Expressed in RMB

Item

Opening

balance

Increase in the reporting

period

Decrease in the reporting period

Ending

balance

Note

Provision Others

Reversal or

Offset

Others

Real estate

developed

products

268941.6

0

268941.60

Raw material

240000.0

0

240000.00

Finished

products

38891.91 38891.91

Total

547833.5

1

547833.51 --

Classified by items:

Expressed in RMB

Item

Opening

balance

Increase in the reporting

period

Decrease in the reporting period

Ending

balance

Note

Provision Others

Reversal or

Offset

Others

(3) Note to the amount of capitalized borrowing costs involved in the ending balance of

inventories

As at June 30 2020 the Group's inventory balance contains the amount capitalized on the borrowing

costs is RMB 3233504.18 (As at Dec 31 2019 RMB 4910251.90).

(4) Inventory restrictions

Inapplicable

10. Contractual assets

Inapplicable

11. Assets held for sale

Inapplicable

12. Non-current assets due within one year

Inapplicable

13. Other non-current assets

Expressed in RMB

Item As at 30 Jun 2020 As at Dec 31 2019

Income tax prepaid 71828974.61 84000516.75

VAT overpaid or prepaid 3973658.77 10211601.86

Deductible input VAT 24829389.60 4741727.70

LAT prepaid 4248831.33 2617779.37

Business tax prepaid 342952.47 353427.19

Others 977610.74 856802.61

Total 106201417.52 102781855.48

Note:

Inapplicable

14. Equity investment

Inapplicable

15. Other equity investment

Inapplicable

16. Long-term receivables

(1) About long-term accounts receivable

Inapplicable

(2) Long term account receivable with recognition terminated due to transfer of financial assets

(3) Amount of assets and liabilities formed through transfer of long-term accounts receivable and

continuing to be involved

Inapplicable

17. Long-term equity investments

Expressed in RMB

Investees

As at

31/12/2019

Movements during the period

As at 30 Jun

2020

Balance of

provision

for

impairment

as June 30

2020

Increase in c

apital

Decrease in

capital

Investment in

come recogni

sed under

equity met

hod

Other compr

ehensive inco

me

Other eq

uity movem

ents

Declared

distributio

n of cash

dividends

or profits

Provision f

or impairm

ent

Other

I. Joint Venture

Guangdong

province

Huizhou

Luofu Hill

Mineral

Water Co.Ltd

9969206.09 9969206.09 9969206.09

Fengkai

Xinhua Hotel

9455465.38 9455465.38 9455465.38

Subtotal 19424671.47 19424671.47 19424671.47

II. Associates

Shenzhen

Ronghua

JiDian Co.

ltd

1546793.29 1546793.29 1076954.64

Shenzhen

Runhua

Automobile

trading Co.Ltd

1445425.56 1445425.56 1445425.56

Dongyi Real

Estate Co.

Ltd

30376084.89 30376084.89 30376084.89

Subtotal 33368303.74 33368303.74 32898465.09

Total 52792975.21 52792975.21 52323136.56

Note:

Inapplicable

Note: See the table below for other equity investments:

Investee Accounting

treatment

cost of investment As at Dec 30 2019 movement As at Jun 30 2020 Provision for

impairment

Paklid Limited Cost method 201100.00 201100.00 -- 201100.00 201100.00

Bekaton Property Limited Cost method 906630.00 906630.00 -- 906630.00 906630.00

Shenzhen Shenfang Department Store Co. Ltd. Cost method 10000000.00 10000000.00 -- 10000000.00 10000000.00

Shantou Fresh Peak Building Cost method 68731560.43 58547652.25 -- 58547652.25 58547652.25

Guangdong Province Fengkai Lain Feng

Cement Manufacturing Co. Ltd

Cost method 121265000.00 56228381.64 -- 56228381.64 56228381.64

Total 201104290.43 125883763.89 0.00 125883763.89 125883763.89

Note: For other equity investments please refer to Note IX. 1 "Equity in Subsidiaries".18. Other equity instrument investments

Expressed in RMB

Item As at 30 Jun 2020 As at Dec 31 2019

Shantou Small &Medium Enterprises

Financing Guarantee Co. Ltd

13549874.72 13229501.03

Yunnan KunPeng Flight service Co.Ltd

19160946.15 19897229.01

Total 32710820.87 33126730.04

Itemized disclosure of investment in non-trading equity instruments for the current period

Expressed in RMB

Item

Dividend

income

recognized for

the current

period

The

cumulative

gains

The

cumulative loss

The amount of

other

comprehensive

reserve

transferred into

retained

earnings

Reasons for

designating fair

value

measurement

and its changes

included in

other

comprehensive

income

Transferring

reasons

Shantou Small

&Medium

Enterprises

Financing

Guarantee Co.Ltd

3444300.00

Yunnan

KunPeng

Flight service

Co. Ltd

1653305.67

Total 5097605.67

Note:

Inapplicable

19. Other non-current financial assets

Inapplicable

20. Investment properties

(1) Investment properties measured using the cost model

√ Applicable □ Inapplicable

Expressed in RMB

Item Plant & buildings Land use rights

Construction in

progress

Total

Ⅰ. Cost

1.Balance as at Dec 31

2019

1043243872.75 107528851.63 1150772724.38

2.Additions during the

year

(1) Purchase

(2) Transfers from

inventories/fixed

assets/construction in

progress

(3) Additions due to

business combinations

3. Decrease during the

year

1692421.08 1692421.08

(1) Disposals

(2) Other transfers out(3) Others（change onforeign exchange)

1692421.08 1692421.08

4. Balance as at Jun 30

2020

1043243872.75 105836430.55 1149080303.30

II. Accumulated

depreciation or

amortization

1. Balance as at Dec

31 2019

416148333.67 416148333.67

2. Charge for the year 12916955.33 12916955.33

(1) Depreciated or

amortised

12916955.33 12916955.33

3. Reductions during

the year

(1) Disposals

(2) Other transfers out

4. Balance as at Jun 30

2020

429065289.00 429065289.00

III. Provision for

impairment

1. Balance as at Dec

31 2019

14128544.62 88253945.89 102382490.51

2. Charge for the year

(1) Provision

3. Reductions on

disposals

1389048.95 1389048.95

(1) Disposals

(2) Other transfers out(3) Others（change onforeign exchange)

1389048.95 1389048.95

4. Balance as at Jun 30

2020

14128544.62 86864896.94 100993441.56

IV. Carrying

amounts

1. As at Jun 30 2020 600050039.13 18971533.61 619021572.74

2. As at Dec 31 2019 612966994.46 19274905.74 632241900.20

(2) Investment property measured at fair value

□ Applicable √ Inapplicable

The company complies with the disclosure requirements of "Shenzhen Stock Exchange Industry

Information Disclosure Guidelines No. 3-Listed Companies Engaged in Real Estate Business"

Does the company have investment real estate that is currently under construction?

□ Yes √ No

Whether the company has new investment real estate measured at fair value in the current period

□ Yes √ No

(3) Investment properties pending certificates of ownership

Inapplicable

21. Fixed assets

Expressed in RMB

Item As at 30 Jun 2020 As at Dec 31 2019

Fixed assets 29086917.96 30522035.11

Total 29086917.96 30522035.11

(1) Fixed assets

Expressed in RMB

Item Plant & buildings Motor vehicles

Electronic equipment

and others

Total

cost:

1. Balance as at Dec

31 2019

107110751.42 10441067.49 13926522.79 131478341.70

2.Additions during

the year

342687.96 184920.76 527608.72

(1) Purchases 342687.96 184920.76 527608.72

(2) Transfers

from construction in

progress

(3) Additions due

to business

combinations

3. Decrease during

the year

190900.00 100087.33 290987.33

(1) Disposals or

written-offs

190900.00 100087.33 290987.33

4.Balance as at Jun

30 2020

107110751.42 10592855.45 14011356.22 131714963.09

II. Accumulated

depreciation

1. Balance as at Dec

31 2019

80644047.51 8945201.13 11367057.95 100956306.59

2. Charge for the

year

1440244.28 143086.27 349710.44 1933040.99

(1) Provision 1440244.28 143086.27 349710.44 1933040.99

3. Reductions for

the year

171334.32 89968.13 261302.45

(1) Disposal or

written-offs

171334.32 89968.13 261302.45

4.Balance as at Jun

30 2020

82084291.79 8916953.08 11626800.26 102628045.13

III. Provision for

impairment

1. Balance as at Dec

31 2019

2. Charge for the

year

(1) Provision

3. Reductions for

the year

(1) Disposals or

written-offs

4.. Balance as at Jun

30 2020

IV. Carrying amount

1. As at Jun 30 2020 25026459.63 1675902.37 2384555.96 29086917.96

2.As at Dec 31 2019 26466703.91 1495866.36 2559464.84 30522035.11

(2) Temporarily idle fixed assets

Inapplicable

(3) Fixed assets acquired under finance leases

Inapplicable

(4) Fixed assets leased out under operating leases

Inapplicable

(5) Fixed assets pending certificates of ownership

Inapplicable

(6) Fixed assets to be disposed of

Inapplicable

22. Construction in progress

(1) Construction in progress

Inapplicable

(2) Movements of major construction projects in progress

Inapplicable

(3) Provision for impairment of construction in progress

Inapplicable

(4) Construction materials

Inapplicable

23. Productive biological assets

(1) Productive biological assets using cost measurement models

Inapplicable

(2) Productive biological assets using fair value measurement model

Inapplicable

24. Oil and gas asset

Inapplicable

25. Right to use assets

Inapplicable

26. Intangible assets

(1) Intangible assets

Expressed in RMB

Item Land rights Patent right Know-how Software Total

I.Cost

1.Balance as at 2241800.00 2241800.00

Dec 31 2019

2.Additions

during the year

(1) Purchase

(2) Internal

development

(3) Additions

due to business

combinations

3. Decrease during

the year

(1) Disposals

4. Balance as at

Jun 30 2020

2241800.00 2241800.00

二. Accumulative

amortisation

1. Balance as at

Dec 31 2019

2241800.00 2241800.00

2. Charge for

the year

(1) Provision

3. Reduction for

the year

(1) Disposals

4. Balance as at

Jun 30 2020

2241800.00 2241800.00

III. Provision for

impairment

1. Balance as at

Dec 31 2019

2. Charge for

the year

(1) Provision

3. Reduction for

the year

(1) Disposals

4. Balance as at

Jun 30 2020

四. Carrying amount

1. As at Jun 30

2020

2. As at Dec 31

2019

Note: Inapplicable

(2) Land use rights pending certificates of ownership

Inapplicable

27. Development costs

Inapplicable

28. Goodwill

(1) Book value of goodwill

Inapplicable

(2) Provision for impairment of the goodwill

Inapplicable

29. Long-term deferred expenses

Expressed in RMB

Item As at Dec 31 2019

Additions during

the year

Amortisation f

or the year

Others decreases

As at Jun 30 2020

Leasehold

improvement

162125.72 34005.88 128119.84

Total 162125.72 34005.88 128119.84

Note:

30. Deferred tax assets and deferred tax liabilities

(1) Deferred income tax asset without offsetting

Expressed in RMB

Item

As at Jun 30 2020 As at Dec 31 2019

(1) Deductible or taxable

temporary

Deferred tax assets/

(2) Deductible or taxable

temporary

Deferred tax assets/

differences

deferred tax

liabilities

differences

deferred tax

liabilities

Provisions for

impairment of assets

5157896.86 1289474.22 5157896.86 1289474.22

Unrealised profits of

intra-group

transactions

0.00 29309607.92 7327401.98

Deductible tax losses 46877417.46 11719354.37 46877417.46 11719354.37

Provision for land

appreciation tax

liquidation reserves

83816495.81 20954123.95 83816495.81 20954123.95

Accrued Contractual

cost

20603882.91 5150970.73 20603882.91 5150970.73

Total 156455693.04 39113923.27 185765300.96 46441325.25

(2) Deferred tax liabilities without offsetting

Expressed in RMB

Item

As at Jun 30 2020 As at Dec 31 2019

(3) Deductible or taxable

temporary

differences

Deferred tax

liabilities

(4) Deductible or taxable

temporary

differences

Deferred tax

liabilities

Changes in the fair

value of other debt

investments

3950685.00 987671.25

Changes in the fair

value of other equity

instrument

investments

15662489.30 3915622.33

Total 19613174.30 4903293.58

(3) Deferred tax assets or deferred tax liabilities disclosed as net amount after offsetting

Expressed in RMB

Item

As at 30 Jun 2020 As at Dec 31 2019

Amount of offsetting

Deferred tax assets or

liabilities after

offsetting

Amount of offsetting

Deferred tax assets or

liabilities after

offsetting

Deferred tax assets 39113923.27 46441325.25

Deferred tax liabilities 4903293.58

(5) (4) Details of unrecognized deferred tax assets

Expressed in RMB

Item As at 30 Jun 2020 As at Dec 31 2019

Deductible tax losses 11987650.99 31568944.69

Bad debt provision 212266973.53 218911499.52

Provision for impairment of long-term

equity.

220084700.95 220084700.95

Provision for impairment of

investment real estate

100993441.56 102382490.51

Total 545332767.03 572947635.67

(5) Expiration of deductible tax losses for unrecognised deferred tax assets

Expressed in RMB

Year As at 30 Jun 2020 As at Dec 31 2019 Note

2019

2020 53561.64 9692495.52

2021 9692495.52 11349323.06

2022 11349323.06 5753184.38

2023 5753184.38 4085485.24

2024 4085485.24 688456.49

Total 30934049.84 31568944.69 --

Note: Inapplicable

31. Other non-current assets

Inapplicable

32. Short term loans

(1) Classification of short-term loans

Expressed in RMB

Item As at 30 Jun 2020 As at Dec 31 2019

Pledge loan 45904965.19 51647260.17

Total 45904965.19 51647260.17

Note: At the end of the period the Group discounted the account receivables amounted to RMB

45904965.19 by factoring to financial institutions and received cash proceeds of RMB 45904965.19.

(2) Past due short-term loan

Inapplicable

33. Transactional financial liabilities

Inapplicable

34. Derivative financial liabilities

Inapplicable

35. Notes payable

Inapplicable

36. Accounts payable

(1) Accounts payable by nature

Expressed in RMB

Item As at 30 Jun 2020 As at Dec 31 2019

Construction 162858915.88 241850173.72

Others 1452225.58 2374304.74

Total 164311141.46 244224478.46

(2) Significant accounts payable with aging over 1 year

Inapplicable

37. Advances from customers

(1) Advances from customers by nature

Expressed in RMB

Item As at 30 Jun 2020 As at Dec 31 2019

Payment for goods 351328.33 351328.33

Property management fees 3301364.20 65874.55

Rental 29772.00 29772.00

Current account from historical issues 4218370.69 4218370.69

Others 215523.98 198897.43

Total 8116359.20 4864243.00

(2) Significant advances from customers with aging over 1 year

The company complies with the disclosure requirements of "Shenzhen Stock Exchange Industry

Information Disclosure Guidelines No. 3-Listed Companies Engaged in Real Estate Business"

the top five project of pre-sale amount:

Expressed in RMB

No. Project As at Dec 31 2019 As at Jun 30 2020

Estimated

completion time

Pre-sale ratio

1

ChuanQi DongHu

Building

59409454.38 186641945.38 Dec 18 2019 56.00%

2

Shengfang CuiLin

Building

61877681.00 4315392.00 May 08 2018 92.00%

3 TianYue Bay No.1 28465188.50 26675556.34 Dec 15 2017 51.00%

4

YueJing dongfang

Project

0.00 30000.00 Apr27 2018 99.00%

5 Jinye Island 1249435.25 94666.67 Aug 1 2010 99.00%

38. Contractual liabilities

Expressed in RMB

Item As at 30 Jun 2020 As at Dec 31 2019

Advance in house payment 208664353.85 145226181.25

Advance in construction payment 70324766.27 5781269.07

Total 278989120.12 151007450.32

Expressed in RMB

Item Change amount Reason for change

Advance in house

payment

63438172.60

The Shenzhen property market recovered rapidly in the

second quarter.

Advance in construction

payment

64543497.20 Project construction business resumed.

Total 127981669.80 ——

39. Employee benefits payable

(1) Employee benefits payable

Expressed in RMB

Item As at Dec 31 2019

Accrued during the

year

Decreased during the

year

As at Jun 30 2020

Short-term employee

benefits

53817671.14 79137401.89 77234324.03 55720749.00

Post-employment

benefits - defined

contribution plans

91905.35 2811709.85 2817073.04 86542.16

Total 53909576.49 81949111.74 80051397.07 55807291.16

(2) Short-term employee benefits

Expressed in RMB

Item As at Dec 31 2019

Accrued during the

year

Decreased during the

year

As at Jun 30 2020

Salaries bonus

allowances

52543725.42 71947309.37 70016850.89 54474183.90

Staff welfare 37800.00 1351134.00 1351134.00 37800.00

Social insurances 1578.57 1513741.26 1513741.26 1578.57

Including: 1. Medical

insurance

1503.22 1340093.50 1340093.50 1503.22

2. Work-related injury

insurance

591.04 5354.76 5354.76 591.04

3. Maternity insurance -515.69 168293.00 168293.00 -515.69

Housing Fund 583666.83 2958902.89 2958902.89 583666.83

Labor union fees staff

and workers’

education fee

650900.32 1366314.37 1393694.99 623519.70

Total 53817671.14 79137401.89 77234324.03 55720749.00

(3) Post-employment benefits - defined contribution plans

Expressed in RMB

Item As at Dec 31 2019

Accrued during the

year

Decreased during the

year

As at Jun 30 2020

Post-employment

benefits

75075.11 739590.08 743399.27 71265.92

Including: 1. Basic

pension insurance

914.12 22533.67 22533.67 914.12

2.

Unemployment

insurance

15916.12 2049586.10 2051140.10 14362.12

Total 91905.35 2811709.85 2817073.04 86542.16

Note: Inapplicable

40. Taxes payable

Expressed in RMB

Item As at 30 Jun 2020 As at Dec 31 2019

Value-added tax 7574137.41 13832233.99

Corporate income tax 38436696.79 51397791.31

Individual income tax 676368.15 1049224.90

City maintenance and construction tax 393855.15 632944.99

Property tax 2369174.67 262015.56

Land appreciation tax 156136644.78 521540610.07

Education surcharge 353043.72 455651.52

Others 1294019.77 141160.13

Total 207233940.44 589311632.47

Note: Inapplicable

41. Other payables

Expressed in RMB

Item As at 30 Jun 2020 As at Dec 31 2019

Interest payables 16535277.94 16535277.94

Other payables 244563068.17 260783896.59

Total 261098346.11 277319174.53

(1) Interest payables

Expressed in RMB

Item As at 30 Jun 2020 As at Dec 31 2019

Non-financial institution borrowing 16535277.94 16535277.94

interest (interest payable to parent

company)

Total 16535277.94 16535277.94

Significant overdue interest outstanding:

Expressed in RMB

Debtor Overdue amount Overdue reason

Shenzhen Investment Holdings Co.Ltd.

16535277.94 Payment suspension

Total 16535277.94 --

Note: Inapplicable

(2) Dividend payables

Inapplicable

(3) Other payables

1) Other payments by nature

Expressed in RMB

Item As at 30 Jun 2020 As at Dec 31 2019

Accrued land appreciation tax 59710423.57

Current account to Related parties 14341496.70 12549466.41

Deposits 81152608.21 105828118.27

Others 149068963.26 82695888.34

Total 244563068.17 260783896.59

2) Including significant other payables with aging over 1 year

Inapplicable

42. Held-for-sale liabilities

Inapplicable

43. Non-current liabilities due within a year

Inapplicable

44. Other current liabilities

Inapplicable

45. Long-term loans

(1) Classification of Long-term loans

Inapplicable

46. Debentures payable

(1) Debentures payable

Inapplicable

(2) Increase/Decrease of Debentures payable (excluding other financial instruments classified as

financial liabilities such as preferred shares perpetual bonds etc.)

Inapplicable

(3) Note to the conditions and time of share conversion of convertible company bonds

Inapplicable

(4) Note to other financial instruments classified as financial liabilities

Inapplicable

47. Lease liabilities

Inapplicable

48. Long-term payables

Expressed in RMB

Item As at 30 Jun 2020 As at Dec 31 2019

Long-term payables 8274256.86 7499192.92

Total 8274256.86 7499192.92

(1) Long-term payables

Expressed in RMB

Item As at 30 Jun 2020 As at Dec 31 2019

Maintenance fund 8274256.86 7499192.92

Note: Inapplicable

(2) Special payables

Inapplicable

49. Long term payroll payable

(1) Long-term employee benefits payable by nature

Inapplicable

(2) Movement of defined benefit plans

Inapplicable

50. Provisions

Inapplicable

51. Deferred income

Inapplicable

52. Other non-current liabilities

Inapplicable

53. Share capital

Expressed in RMB

As at Dec 31

2019

Increase / Decrease (+/ -)

As at Jun 30

2020 New issuing Bonus shares

Shares

converted

from reserve

Others Sub-total

Shares

101166000

0.00

101166000

0.00

Note: Inapplicable

54. Other equity instruments

(1) Basic information on the outstanding other financial instruments including preferred shares

perpetual bonds etc. at the end of the reporting period

Inapplicable

(2) Movement of the outstanding other financial instruments including preferred shares

perpetual bonds etc. at the end of the reporting period

Inapplicable

55. Capital reserve

Expressed in RMB

Item As at Dec 31 2019

Increase in the

reporting period

Decrease in the

reporting period

As at Jun 30 2020

Capital premium

(share premium)

557433036.93 557433036.93

Other capital reserve 420811873.18 420811873.18

Total 978244910.11 978244910.11

Note: Inapplicable

56. Treasury shares

Inapplicable

57. Other comprehensive income

Expressed in RMB

Item

As at Dec

31 2019

Jan to Jun 2020

As at

Jun 30

2020

Amount

incurred

before

income

tax in the

reporting

period

Less: the

amount

counted to

the profit

and loss

during the

reporting

period

which had

been

Less: the

amount

counted

to the

retained

earnings

during

the

reporting

period

Less:

Income

tax

expense

Attributa

ble to the

parent

company

after tax

Attributa

ble to

minority

sharehold

ers after

tax

counted to

the other

comprehens

ive income

in the

previous

period.which

had been

counted

to the

other

comprehe

nsive

income in

the

previous

period.I. Items that will not be

reclassified to profit or loss

11746866

.97

-415909.

17

-415909.

17

11330

957.80

Changes in fair value

of other equity instruments

11746866

.97

-415909.

17

-415909.

17

11330

957.80

II. Items that may be

reclassified to profit or loss

9084137.

16

785397.1

1

0.00 0.00

785397.1

1

336598.

76

98695

34.27

Translation differences

arising from translation of

foreign currency financial

statements

9084137.

16

785397.1

1

785397.1

1

336598.

76

98695

34.27

Total

20831004

.13

369487.

94

0.00 0.00

369487.

94

336598.

76

21200

492.07

Note: Inapplicable

58. Special reserve

Inapplicable

59. Surplus reserve

Expressed in RMB

Item As at Dec 31 2019

Increase in the

reporting period

Decrease in the

reporting period

As at Jun 30 2020

Surplus reserve 191222838.94 191222838.94

Total 191222838.94 191222838.94

Note: According to the "Company Law" and the company's articles of association the company

appropriates a statutory surplus reserve at 10% of its net profit. It will no longer be appropriated if the

accumulative amount of statutory surplus reserve reaches more than 50% of the company's registered

capital.60. Retained earnings

Expressed in RMB

Item Jan to Jun 2020 Jan to Jun 2019

Before adjustment: Retained earnings at the

end of the previous period

1464915816.81 1235884122.72

After adjustment: Retained earnings at the

beginning of the reporting period

1464915816.81 1235884122.72

Plus: Net profit attributable to the parent

company’s owner in the report period

97274985.72 333155843.41

Dividends payable to ordinary shares 166923900.00 202332000.00

Retained earnings at the end of the reporting

period

1395266902.53 1366707966.13

Statement of adjustment of retained earnings at the beginning of the reporting period:

1). Retrospective adjustments of RMB 0.00 made on beginning retained earnings in accordance with

CAS and related new regulations.

2). RMB 0.00 on beginning retained earnings due to changes in accounting policies.

3). RMB 0.00 on beginning retained earnings due to corrections of significant accounting errors.

4). RMB 0.00 on beginning retained earnings due to changes in consolidation scope resulting from

business combinations involving entities under common control.

5). RMB 0.00 on beginning retained earnings due to other adjustments.

61. Operation Income and Costs

Expressed in RMB

Item

Jan to Jun 2020 Jan to Jun 2019

Income Costs Income Costs

Principal activities 592168994.82 342975012.09 1242185437.00 435833288.18

Other operating

activities

4089500.58 933075.37 9152365.57 1294688.07

Total 596258495.40 343908087.46 1251337802.57 437127976.25

Income related information:

Inapplicable

Information related to performance obligations:

The Group's current real estate projects for sale are all existing properties it usually takes 3-5 months

from contract signing to online signing mortgage loan and final deliver. The contracts that have been

signed at the end of the reporting period are expected to be implemented before the end of 2020.Information related to the transaction price allocated to the remaining performance obligations:

At the end of the reporting period the amount of revenue corresponding to the performance obligations

that have been signed but not yet performed or not yet completed is RMB 712771664.00 Among

them RMB 712771664.00 yuan is expected to be recognized as revenue in 2020 RMB 0 is expected

to be recognized as revenue in the year and RMB 0 is expected to be recognized as revenue in the year.Note:

The company complies with the disclosure requirements of "Shenzhen Stock Exchange Industry

Information Disclosure Guidelines No. 3-Listed Companies Engaged in Real Estate Business"

Information of the top five projects that the revenue recognized during the reporting period:

Expressed in RMB

No. Project Income amount

1 ChuanQi DongHu Building 211598844.76

2 Shengfang CuiLin Building 91474775.24

3 TianYue Bay No.1 75582142.07

4 Jinye Island 3602387.63

5 YueJing dongfang Project 200000.00

62. Taxes and surcharges

Expressed in RMB

Item Jan to Jun 2020 Jan to Jun 2019

Urban maintenance and construction

tax

1825068.95 4231214.16

Education surcharge 811262.23 1853152.20

Property tax 2110622.87 4194843.79

Land use tax 107733.28 1777.06

Vehicle and vessel usage tax 4710.00 9300.00

Stamp duty 213285.17 634612.37

Business tax 16283.92 14811.80

Land appreciation tax 79824750.12 328213378.55

Local education surcharge 491930.13 1168752.72

Embankment protection fees 202466.20 7656.21

Total 85608112.87 340329498.86

Note: The criteria of taxes and surcharges accrued and paid refer to Note XI.6 Taxation

63. Selling and distribution expenses

Expressed in RMB

Item Jan to Jun 2020 Jan to Jun 2019

Employee benefits 2823089.29 1986157.74

Advertising expenses 1284043.70 3495309.87

Entertainment expenses 238746.50 445386.30

Commissions 3615467.32 10153801.11

Others 575101.57 2393405.31

Total 8536448.38 18474060.33

Note: The selling and distribution expenses incurred in the current period are RMB 8536448.38 there

is a decrease of 53.79% over the same period of the previous period. The main reason was the impact

of the COVID-19 and the decrease in the property on sale.

64. General and administrative expenses

Expressed in RMB

Item Jan to Jun 2020 Jan to Jun 2019

Employee benefits 33335370.04 21455353.43

Taxes 381863.80

Depreciation 1362176.52 1493957.93

Entertainment expenses 820263.83 855870.94

Professional fee 337923.08 748240.08

Travel expense 16813.77 160955.48

Office expenses 628812.36 889536.21

Maintenance expenses 395651.84 443034.63

Utilities 190945.62 300958.94

Amortization 150041.78 209939.04

Others 3015978.42 3873060.85

Total 40253977.26 30812771.33

Note: The General and administrative expenses incurred in the current period amounted to RMB

40253977.26 there is an increase of 30.64% over the same period of the previous period the main

reason was the after the construction project finished the employee expense included in general and

administrative expenses.

65. R & D expenditures

Inapplicable

66. Financial expenses

Expressed in RMB

Item Jan to Jun 2020 Jan to Jun 2019

Interest expenses 38742.51

Less: Interest income 5932973.60 7623553.05

Less: capitalized interest

Exchange losses/-gains -28526.54 672254.35

Less: Exchange losses and gains

capitalized

Bank charges and others 213914.16 286297.07

Total -5747585.98 -6626259.12

Note: Inapplicable

67. Other income

Expressed in RMB

Item (Source of other income) Jan to Jun 2020 Jan to Jun 2019

Input VAT deduction 557379.14

68. Investment income

Expressed in RMB

Item Jan to Jun 2020 Jan to Jun 2019

Dividend from investments in other

equity instruments

928200.00

Financial product 15217058.60 13359898.55

Total 15217058.60 14288098.55

Note: Inapplicable

69. Net exposure hedge income

Inapplicable

70. Income from change of the fair value

Inapplicable

71. Loss from impairment of credit

Inapplicable

72. Loss from impairment of assets

Expressed in RMB

Item Jan to Jun 2020 Jan to Jun 2019

I. impairment of assets such as

Receivables Inventories

534500.00

Total 534500.00

Note:

73. Income from disposal of assets

Inapplicable

74. Non-operating income

Expressed in RMB

Item Jan to Jun 2020 Jan to Jun 2019

Amount counted to the

current non-operating gain

and loss

Government grants 2792616.39 2792616.39

Confiscated income 70000.00 180000.00 70000.00

Others 39417.38 183709.11 39417.38

Total 2902033.77 363709.11 2902033.77

Government subsidy counted to the current profit and loss: +

Expressed in RMB

Item Issuer

Reason for

issue

Subsidy

nature

Does the

subsidy

affect the

profit and

loss of the

year

Whether

special

subsidy

Current

period

Jan to Jun

2019

Related to

asset/incom

e

Local

government

subsidy for

COVID-19

prevention

Luohu

District

Government

Subsidy

Government

subsidies to

avoid losses

of listed

companies

No Yes

2792616.3

9

income

Note: Inapplicable

75. Non-operating expenses

Expressed in RMB

Item Jan to Jun 2020 Jan to Jun 2019

Amount counted to the

current non-operating gain

and loss

Donations provided 500000.00 500000.00

Fine 150.00 0.00

Others 1501278.48 3605.82 1501278.48

Total 2001278.48 3755.82 2001278.48

Note:

76. Income tax expense

(1) (1) Details of income tax expenses

Expressed in RMB

Item Jan to Jun 2020 Jan to Jun 2019

Current tax expense for the year based

on tax law and regulations

43599689.97 114631330.89

Changes in deferred tax

assets/liabilities

-1901537.03

Total 43599689.97 112729793.86

(2) (2) Reconciliation between income tax expenses and accounting profit is as follows:

Expressed in RMB

Item Jan to Jun 2020

Profits/losses before tax 140909148.44

Expected income tax expenses at applicable tax rate 35227287.11

Effect of different tax rates applied by subsidiaries 0.00

Effect of non-deductible costs expenses and losses 8372402.90

Effect of deductible temporary differences or deductible

losses for which no deferred tax asset was recognized

this year

0.00

Income tax expenses 43599689.97

Note:

77. Other comprehensive income

For the detail refer to Note VII. 57.

78. Cash Flow Statement

(1) Proceeds from other operating activities

Expressed in RMB

Item Jan to Jun 2020 Jan to Jun 2019

Interest income 5407752.35 5457487.50

Deposits and security deposits 2919486.01 4341166.84

Maintenance Fund 588849.58 2806860.02

Collecting fee for certifications on

behalf

259013.65 318872.66

Others 33335274.12 23748832.28

Total 42510375.71 36673219.30

Note to Proceeds from other operating activities:

Inapplicable

(2) Payment for other operating activities

Expressed in RMB

Item Jan to Jun 2020 Jan to Jun 2019

Payment for general and

administrative expenses

5953780.78 9012769.52

Payment for selling and distribution

expenses

10827564.54 21249982.55

Deposits and security deposits 2573686.00 3827745.89

Paying fee for certifications on behalf 75218.11 1006131.98

Others 89300550.71 93795526.79

Total 108730800.14 128892156.73

Note to payment for other operating activities:

Inapplicable

(3) Proceeds from other investing activities

Expressed in RMB

Item Jan to Jun 2020 Jan to Jun 2019

Restricted cash recovered in the

current period –

structured deposit

1000000000.00 900000000.00

Total 1000000000.00 900000000.00

Note to proceeds from other investing activities:

Inapplicable

(4) Payment for other investing activities

Expressed in RMB

Item Jan to Jun 2020 Jan to Jun 2019

Restricted cash paid in the current

period

–structured deposit

1300000000.00

Total 1300000000.00

Note to payment for other investing activities:

Inapplicable

(5) Proceeds from other financing activities

Inapplicable

(6) Payment for other financing activities

Inapplicable

79. Supplementary information of the cash flow statement

(1) Supplementary information of the cash flow statement

Expressed in RMB

Supplementary information Jan to Jun 2020 Jan to Jun 2019

1. Reconciliation of net profit/loss to

cash flows from operating activities:

-- --

Net profit 97309458.47 333138012.90

Add: Provisions for

impairment of assets

13145126.03 13279140.03

Amortization of the long-term

expenses to be apportioned

59662.86 353309.40

Loss from scrapping of fixed

assets ("-" for gains)

17829.60 774.32

Financial expenses ("-" for

income)

3135908.80 -143574.86

Losses arising from

investment ("-" for gains)

-15217058.60 -14288098.55

Decrease of the deferred tax

asset ("-" for increase)

7327401.98 -1901537.03

Increase of deferred income

tax liability ("-" for decrease)

-4903293.58

Decrease of inventories ("-"

for increase)

186722872.58 163504710.44

Decrease in operating

receivables ("-" for increase)

-225749300.15 53925974.21

Increase in operating payables("-" for decrease）

-274147130.87 139929891.38

Others 55724.29 -2123357.14

Net cash flows from operating

activities

-212242798.59 685675245.10

2. Investing and financing activities

not requiring the use of cash:

-- --

3. Change in cash and cash

equivalents:

-- --

Cash as at Jun 30 2020 2148222433.87 1240480893.15

Less: cash as at Dec 31 2019 1507189760.35 1148522435.93

Net increase in cash and cash

equivalents

641032673.52 91958457.22

(2) Net cash paid to acquirement of subsidiary in the reporting period

Inapplicable

(3) Net cash received from disposal of subsidiary in the reporting period

Inapplicable

(4) Details of cash and cash equivalents

Expressed in RMB

Items As at Jun 30 2020 As at Dec 31 2019

I. Cash 2148222433.87 1507189760.35

Including: Cash on hand 68146.22 66252.42

Cash in bank 426154287.65 1493123507.93

Other monetary fund used for

payment at any time

1722000000.00 14000000.00

III. Ending balance of cash and cash

equivalents

2148222433.87 1507189760.35

Note: Inapplicable

80. Notes to statement of changes in shareholders' equity

Specify the description of the item "others" and the adjusted amount of the balance at the end of last

year: Inapplicable

81. Assets with restrictive ownership title or right of use

Expressed in RMB

Items

Book value at the end of the

reporting period

Reason of restriction

Account receivable 45904965.19 Short-term loan pledge

Total 45904965.19 --

Note: Inapplicable

82. Foreign currency translation

(1) Items in Foreign currency

Expressed in RMB

Item

Ending balance of foreign

currency

Conversion rate

Ending balance of Renminbi

converted

Cash at bank and on hand -- --

Including: USD 22259.36 6.8664 152841.67

Euro

HKD 8733756.68 0.9100 7947747.07

Accounts receivable -- --

Including: USD

Euro

HKD 4905150.10 0.9100 4463702.59

Long-term Loan -- --

Including: USD

Euro

HKD

Other receivables

Including: USD --

HKD 20165086.70 0.9100 18350294.68

Other payables

Including: USD 655299.33 6.8664 4499547.33

HKD

Note:

The company’s important overseas business entities are Great Wall Real Estate Co. Ltd. and Xinfeng

Enterprise Co. Ltd. Since Great Wall Real Estate Co. Ltd. is mainly operating in the United States it

chooses the US dollar as the bookkeeping currency; Xinfeng Enterprise Co. Ltd. is an investment

company the main business activities of its investment entities are all in mainland China and the RMB

is used as the standard currency for bookkeeping so it chooses RMB as the standard currency for

bookkeeping.

(2) Note to overseas operating entities including important overseas operating entities which

should be disclosed about its principal business place function currency for bookkeeping and

basis for the choice. In case of any change in function currency the cause should be disclosed.Inapplicable

83. Hedging

Disclosure of qualitative and quantitative information on hedged items related hedging tools and

hedged risks according to hedge categories:

84. Government subsidies

(1) Basic information of government subsidies

Expressed in RMB

Categories Amount Items presented

Amount counted to the

current profit and loss

Local government subsidy

for COVID-19 prevention

2792616.39 Other income 2792616.39

(2) Refunding of the government subsidies

Inapplicable

85. Others

Inapplicable

VIII. Change in consolidation scope

1. Business combinations involving enterprises not under common control

(1) Business combinations involving enterprises not under common control occurred during the

year

Inapplicable

(2) Acquisition cost and goodwill

Inapplicable

(3) Identifiable assets and liabilities of the acquiree at the acquisition date

Inapplicable

(4) Gain or loss from remeasurement of equity interests held prior to acquisition date to fair

value

Does there exist any transaction in which the enterprise consolidation is realized step by step through

several transactions and the control power is obtained within the reporting period.□ Yes √ No

(5) Note to the consolidation consideration or the fair value of the distinguishable assets and

liabilities of the purchase which cannot be reasonably identified as at the date of purchase or at

the end of the very period of consolidation

Inapplicable

(6) Other notes:

No change took place in the consolidation scope of the Company in 2020

2. Business combinations involving enterprises under common control

(1) Business combinations involving enterprises under common control during the period

Inapplicable

(2) Combination cost

Inapplicable

(3) Assets and liabilities of the acquire at the combination date

Inapplicable

3. Counter purchase

Inapplicable

4. Disposal of subsidiaries

Does there exist any such situation that disposal of investments in subsidiaries through a single

transaction resulting in loss of control?

□ Yes √ No

Does there exist any such situation that disposal of investments in subsidiaries through multiple

transactions resulting in loss of control during the year.□ Yes √ No

5. Change of consolidation scope due to other reason

Note to the change in the consolidation scope (e.g. new subsidiaries liquidation subsidiaries etc.)

caused by other reasons and relevant information:

Inapplicable

6. Others

Inapplicable

IX. Equity in other entities

1. Interests in subsidiaries

(1) Composition of the Group

Subsidiaries

Principal place

of business

Place of

registration

Nature of

business

Shareholding proportion Way of

acquisition Direct Indirect

Shenzhen City

SPG Long

Gang

Development

Ltd.Shenzhen Shenzhen

Real estate

development

95.00% 5.00%

Acquiring

through

establishment

or investment

American Great

Wall Co. Ltd

U.S. U.S.Real estate

development

70.00%

Acquiring

through

establishment

or investment

Shenzhen City

Property

Management

Ltd.Shenzhen Shenzhen

Property

management

95.00% 5.00%

Acquiring

through

establishment

or investment

Shenzhen Petrel

Hotel Co. Ltd.Shenzhen Shenzhen Hotel Services 68.10% 31.90%

Acquiring

through

establishment

or investment

Shenzhen Zhen

Tung

Engineering

Ltd.Shenzhen Shenzhen

Installation and

maintenance

73.00% 27.00%

Acquiring

through

establishment

or investment

Shenzhen City

We Gen

Construction

Management

Ltd.Shenzhen Shenzhen Supervision 75.00% 25.00%

Acquiring

through

establishment

or investment

Shenzhen Lain

Hua Industry

and Trading

Co. Ltd.

Shenzhen Shenzhen

Mechanical &

Electrical

device

installation

95.00% 5.00%

Acquiring

through

establishment

or investment

Fresh Peak

Zhiye Co. Ltd.Hong Kong Hong Kong

Investment and

management

100.00%

Acquiring

through

establishment

or investment

Xin Feng

Enterprise Co.

Ltd.Hong Kong Hong Kong

Investment and

management

100.00%

Acquiring

through

establishment

or investment

Shenzhen City

Shenfang Free

Trade Trading

Ltd.Shenzhen Shenzhen

Commercial

trade

95.00% 5.00%

Acquiring

through

establishment

or investment

Shenzhen City

Shenfang

Investment Ltd.Shenzhen Shenzhen Investment 90.00% 10.00%

Acquiring

through

establishment

or investment

Shenzhen

Special

Economic Zone

Shenzhen Shenzhen Real estate 95.00% 5.00%

Acquiring

through

establishment

Real Estate

(Group)

Guangzhou

Property and

Estate Co. Ltd.

or investment

Beijing fresh

peak property

development

management

limited

company

Beijing Beijing Real estate 75.00% 25.00%

Acquiring

through

establishment

or investment

Note:

①In consolidation scope there are five subsidiaries in “revoked but not cancelled” condition: Beijing

SPG Property Management Limited Guangzhou Huangpu Xizun real estate limited company

Shenzhen Special Economic Zone Real Estate (Group) Guangzhou Property and Estate Co. Ltd. Fresh

Peak Real Estate Dev. Construction (Wuhan) Co. Ltd. and Beijing Shenfang Property Management Co.Ltd. They are presented on the basis of discontinued operations; these five subsidiaries have made full

provision for impairment of debt for the companies outside the consolidation scope.②The cancelled revoked and closed subsidiaries of the Company that are not included in the scope of

consolidation are as follows:

Name

Principal

place of

business

Registration

place

Business

nature

Shareholding proportion Way of acquisition

Direct Indirect

Shenzhen Shenfang

Department Store Co. Ltd

Shenzhen Shenzhen

Commercial

trade

95.00 5.00 Acquiring through

establishment or

investment

Paklid Limited Hong Kong Hong Kong

Commercial

trade

60.00 40.00 Acquiring through

establishment or

investment

Bekaton Property Limited Australia Australia Real estate

60.00 -- Acquiring through

establishment or

investment

Canada Great Wall

(Vancouver)

Canada Canada Real estate

-- 60.00 Acquiring through

establishment or

investment

Guangdong Fengkai County

Lianfeng Cement

Manufacturing Co. Ltd.

Fengkai

Guangdong

Fengkai

Guangdong

Manufacturin

g

-- 90.00 Acquiring through

establishment or

investment

Jiangmen Xinjiang Real Estate

Co. Ltd

Jiangmen

Guangdong

Jiangmen

Guangdong

Real estate

-- 90.91 Acquiring through

establishment or

investment

Xi’an Fresh Peak Property Xi’an Shanxi Xi’an Shanxi Real estate -- 67.00 Acquiring through

Trading Co. Ltd establishment or

investment

Shenxi Limited Shenzhen Shenzhen

Building

Decoration

70.00 -- Acquiring through

establishment or

investment

Shenzhen Zhentong New

Electromechanical Industry

Development Co. Ltd.

Shenzhen Shenzhen

Mechanical

and electrical

engineering

95.00 5.00 Acquiring through

establishment or

investment

Shenzhen Real Estate

Electromechanical

Management Company

Shenzhen Shenzhen

Electromecha

nical

Management

100.00 -- Acquiring through

establishment or

investment

Shenzhen Nanyang Hotel Co.Ltd.Shenzhen Shenzhen

Hotel

Management

95.00 5.00 Acquiring through

establishment or

investment

Shenzhen Kangtailong

Industrial Electric Cooker Co.Ltd.Shenzhen Shenzhen

Industrial

manufacturing

-- 100.00 Acquiring through

establishment or

investment

Shenzhen Longgang

Henggang Huagang Industrial

Co. Ltd.

Shenzhen Shenzhen

Industrial

Investment

-- 79.92 Acquiring through

establishment or

investment

Note: 1. Shenzhen Shenfang Department Store Co. Ltd held a shareholders meeting on 29 October

2007 decided to terminate the business and formed a group for liquidation. The liquidation group

issued a liquidation report on 7 December 2007.

2. Paklid Limited Bekaton Property Limited and Canada Great Wall (Vancouver) they were

companies established by the group overseas in the early years. On 13 December 2000 the group held

a board of directors and decided to liquidate these three companies. Bekaton Property Limited and

Canada Great Wall (Vancouver) the cancellation procedures were completed.

3. All assets from Guangdong Fengkai County Lianfeng Cement Manufacturing Co. Ltd. (including

tangible and intangible asset) was auctioned by the court on 22 January 2019 and it became a shell

company.

4. Shenxi Limited was the Group’s cancelled subsidiary Shenzhen Tefa Real Estate ConsolidatedServices Co. Ltd.’s subsidiary By the Group “The notice on the merger of Shenzhen Zhen Tung

Engineering Ltd and Shenxi Limited” (Shenfang [1997] No.19) announcement all businesses form

Shenxi Limited were undertaken by Shenzhen Zhen Tung Engineering Ltd and Shenxi Limited was

revoked on 8 February 2002.These invested companies that have not been included in the consolidation scope were either been

cancelled or ceased operation many years ago and the company entities were no longer exist theGroup could no longer effectively control them. According to “Accounting Standard for Business

Enterprises No. 33-Consolidated Financial Statements” the above companies are not included in the

consolidated scope of the group consolidated financial statement the group already fully provision for

impairment the investment or the book value of the net investment in these companies.

(2) Material non-wholly owned subsidiaries

Expressed in RMB

Name

Proportion of

ownership interest

held by

non-controlling

interests %

Profit or loss

allocated to

non-controlling

interests during the

year

Dividend declared to

non-controlling

shareholders during

the year

Balance of

non-controlling

interests as at June

30 2020

Great Wall Estate Co.Inc

30.00% 34472.75 -21825629.75

Fresh Peak Investment

Ltd

45.00% -7071.37 -116161941.11

Barenie Co. Ltd. 20.00% -3155.03 -3879518.63

Note: Inapplicable

(3) Key financial information about material non-wholly owned subsidiaries

Expressed in RMB

Name

As at Jun 30 2020 As at Dec 31 2019

Curren

t assets

Non-cu

rrent

assets

Total

assets

Curren

t

liabiliti

es

Non-

current

liabiliti

es

Total

liabiliti

es

Curren

t assets

Non-cu

rrent

assets

Total

assets

Curren

t

liabiliti

es

Non-

current

liabiliti

es

Total

liabiliti

es

Great

Wall

Estate

Co. Inc

152841

.67

18971

533.61

19124

375.28

106275

257.03

106275

257.03

38598.

97

19274

905.74

19313

504.71

107974

695.34

107974

695.34

Fresh

Peak

Investm

ent Ltd

220030

128.55

220030

128.55

254791

710.04

254791

710.04

220030

114.17

220030

114.17

254775

981.50

254775

981.50

Barenie

Co. Ltd.

1064.9

0

1064.9

0

32858

028.84

32858

028.84

1045.7

0

1045.7

0

32842

234.42

32842

234.42

Continued

Expressed in RMB

Name

Jan to Jun 2020 Jan to Jun 2019

Operating

income

Net profit

Total

comprehen

sive income

Cash flows

from

operating

activities

Operating

income

Net profit

Total

comprehen

sive income

Cash flows

from

operating

activities

Great Wall

Estate Co.

Inc

142264.71 114909.18 114909.18 114087.11 322901.55 -59435.04 -59435.04 -59442.30

Fresh Peak

Investment

Ltd

-15714.16 -15714.16 -14211.32 -14211.32

Barenie Co.

Ltd.

-15775.13 -15775.13 -15975.45 -15975.45

Note: Inapplicable

(4) Material restriction on the use of the Group’s assets and the settlement of the Group’s

liabilities

Inapplicable

(5) Financial support or other support provided to the structured entities incorporated in the

scope of consolidated financial statements

Inapplicable

2. Transactions that cause changes in the Group’s interests in subsidiaries that do not result in

loss of control

(1) Changes in the Group’s interests in subsidiaries:

Inapplicable

(2) Impact from transactions with non-controlling interests and equity attributable to the

shareholders of the Company:

Inapplicable

3. Interests in joint ventures or associates

(1) Material joint ventures or associates

Inapplicable

(2) Key financial information of material joint ventures:

Inapplicable

(2) Key financial information of material associates

Inapplicable

(3) Summarised financial information of immaterial joint ventures and associates:

Expressed in RMB

Ending balance/amount incurred in

the reporting period

Opening balance/amount incurred in

the reporting period

Joint ventures: -- --

Aggregate amount of share of -- --

Associates: -- --

Aggregate carrying amount of

investments

469838.65

Aggregate amount of share of -- --

Net profit 75629.25

Note:

(4) Material restrictions on transfers of funds from investees to the Group

Inapplicable

(5) Excess loss from joint ventures or associates

Expressed in RMB

Investee

Accumulated unrecognized

loss in prior periods

Unrecognized loss (or

share of net profit) for the

year

Accumulated unrecognized

loss as at 31/12/2019

Shenzhen Fresh Peak

property consultant Co. Ltd

941374.25 154587.30 1095961.55

Note: Shenzhen Fresh Peak property consultant Co. Ltd was established on 15 March 1990 Registered

capital of 3000000 the group subscribed RMB 600000 (20% in total capital). As at 31 December

2019 the group contributed RMB 600000 and already confirmed long-term equity invent lose RMB

600000.

(6) The company shall disclose its unrecognized commitments in connection with its investment

in joint ventures.Inapplicable

The company shall disclose its contingent liabilities in connection with its investment in joint ventures

or associates.Inapplicable

5. Material joint operations

Inapplicable

6. Others

Inapplicable

X. Financial instruments and risk management

The major financial instruments of the Group include cash at bank and on hand accounts receivable

other receivable other current assets other equity instrument account payables other payables

short-term loans and long-term payables. The details of these financial instruments are disclosed in the

respective notes. The financial risk of these financial instruments and financial management policies

used by the Group to minimize the risk are disclosed as below. The management manages and monitors

the exposure of these risks to ensure the above risks are controlled in the limited range.

1. Objectives and policies of financial risk management

The Group’s objective in risk management is to obtain an appropriate equilibrium between risk and

return. It also focuses on the unpredictability of financial markets and seeks to minimize potential

adverse effects on the Group’s financial performance. Based on the objectives of financial risk

management certain policies are made to recognize and analyze risk and internal control is designed

according to proper acceptable in order to monitor the risk position of the Group. Both the policies and

internal control will be reviewed and revised regularly to adapt the changes of the market and business

activities of the Group. The performance of internal control will be reviewed regularly or randomly in

accordance with the financial management policies.The Group’s financial instrument risks mainly include credit risk liquidity risk and market risk.(Including currency risk interest rate risk and commodity price risk)

The board of directors is responsible for planning and establishing the risk management structure of the

Group formulating the Group’s risk management policies and related guidelines supervising the

implementation of risk management measures. The Group has established risk management policies to

identify and analyze the risks faced by the Group. These risk management policies clearly define

specific risks covering market risk credit risk and liquidity risk. The Group regularly assesses changes

in the market environment and the Group’s operating activities to determine whether update risk

management policies and systems.The Group diversifies the risk of financial instruments through appropriate diversified investments and

business combinations and reduces the risk of concentration in a single industry a specific region or a

specific counterparty by developing appropriate risk management policies.

(1) Credit risk

Credit risk refers to the risk that the counterparty to a financial instrument would fail to discharge its

obligation under the terms of the financial instrument and cause a financial loss to the Group.

Credit is managed on the grouping basis. Credit risk is mainly arising from cash at bank accounts

receivable and other receivables

The Group expects that there is no significant credit risk associated with cash at bank since it is

deposited or will be accepted by the sate-owned banks and other medium or large size listed banks.The Group has policies to limit the credit risk exposure on accounts receivables and other receivables.The Group assesses the credit quality of and sets credit limits on its customers by taking into account

their financial position the availability of guarantee from third parties the availability of guarantee

from third parties their credit history and other factors such as current market conditions. The credit

history of the customers is regularly monitored by the Group. In respect of customers with a poor credit

history the Group will use written payment reminders or shorten or cancel credit periods to ensure the

overall credit risk of the Group is limited to a controllable extent.The Group’s debtors of account receivables are in difference industries and regions the Group

continues in evaluation the debtor’s financial status.The highest credit risk exposed to the Group is limited to the carrying amount of each financial

instrument illustrated in the balance sheet. The Group would not provide any guarantee that might

cause credit risk to the Group.

Among the accounts receivable of the Group the bills receivable and accounts receivable of the top

five customers accounted for 61.97% (2019: 53.79%); among the other receivables of the Group the

other receivable of the top five customers accounted for 67.68% (2019: 62.80%)

(2)) Liquidity risk

Liquidity risk refers to the risks that the Group will not be able to meet its obligations associated with

its financial liabilities that are settled by delivering cash or other financial assets.

Cash flow forecasting is performed by Group’s finance department. The Group’s finance management

monitors cash and cash equivalents to meet operational needs and reduce the effect of floating cash

flow. The department monitors the usage of bank loan so that the Group does not breach borrowing

limits or covenants while maintaining sufficient headroom on its undrawn committed borrowing

facilities from major financial institute to meet the short-term and long-term liquidity requirements.The Group raises working capital from its operations bank and other borrowings. As at June 30 2020

the amount of bank loans not yet used by the Group is RMB 0.00.he financial assets and liabilities off-balance-sheet guarantee items of the Group at June 30 2020 are

analyzed by their maturity date below at their undiscounted contractual cash flows (RMB in ten

thousand):

Item As at June 30 2020

Within 1 year 1 to 5 years Over 5 years Total amount

Financial liabilities:

Short-term loans 4590.50 -- -- 4590.50

Accounts payable 16431.11 -- -- 16431.11

Interest payables 1653.53 -- -- 1653.53

Other payables 20051.11 -- -- 20051.11

Long-term payables -- 827.43 -- 827.43

Guarantees for client 37384.58 -- -- 37384.58

Total liabilities 80110.83 827.43 -- 80938.26

The financial assets and liabilities off-balance-sheet guarantee items of the Group as at Dec 31 2019

are analyzed by their maturity date below at their undiscounted contractual cash flows (RMB in ten

thousand):

Item 2019.12.31

Within 1 year 1 to 5 years Over 5 years Total amount

Financial liabilities:

Short-term loans 5164.73 -- -- 5164.73

Accounts payable 24422.45 -- -- 24422.45

Interest payables 1653.53 -- -- 1653.53

Other payables 20051.11 -- -- 20051.11

Long-term payables -- 749.92 -- 749.92

Guarantees for client 47539.67 -- -- 47539.67

Total liabilities 98831.49 749.92 -- 99581.41

The amount of financial liabilities disclosed in the above table is undiscounted contractual cash flow

and may differ from the carrying amount in the balance sheet.The maximum guarantee contract that already signed does not represent the amount need to paid.

(3) Market risk

Market risk includes interest rate risk and foreign currency risk refers to the risk that the fair value or

future cash flow of a financial instrument will fluctuate because of the changes in market price.Interest rate risk

Interest rate risk refers to the risk that the fair value or future cash flow of a financial instrument will

fluctuate because of the floating rate. Interest rate risk arises from recognized interest-bearing financial

instrument and unrecognized financial instrument (e.g. loan commitments).The Group’s interest rate risk arises from long-term bank loans and other interest-bearing liabilities.

Financial liabilities issued at floating rate expose the Group to cash flows interest rate risk. Financial

liabilities issued at fixed rate expose the Group to fair value interest rate risk. The Group determines the

relative proportions of its fixed rate and floating rate contracts depending on the prevailing market

conditions. At the same time the Group monitors and maintains the combined financial instruments of

fixed rate and floating rate.

During the reporting period the Group operates by its own working capital. As at 31 December 2019

the Group has no financial liabilities with fixed or floating interest rate such as bank loan. Therefore

the Group believes that the interest rate risk is insignificant.Interest-bearing financial instruments held by the Group (RMB in ten thousand):

Foreign currency risk

Foreign currency risk refers to the risk that the fair value or future cash flows of a financial instrument

will fluctuate because of changes in foreign currency rates. Foreign currency risk arises from the

functional currency denominated financial instrument measured at individual entity.The foreign currency risk is mainly comes from the group’s financial position and cash flow which is

affected by the fluctuations of the foreign exchange rates. As the subsidiary establish in Hong Kong

SAR and U.S. are using local currency as settlement currency other foreign currency assets and

liabilities held by the Group compare with the group’s total assets and liabilities are insignificant

therefore the Company believe the foreign currency risk is insignificant.

2. Capital risk management

The objectives of the Group’s capital risk management are to safeguard the Group’s ability to continue

as a going concern in order to provide returns for shareholders and benefits for other stakeholders and

to maintain an optimal capital structure to reduce the cost of capital.In order to maintain or adjust the capital structure the Group may adjust the amount of dividends paid

to shareholders return capital to shareholders issue new shares or disposes assets to reduce its

liabilities.The Group monitors capital on the basis of the gearing ratio. This ratio is calculated as net liabilities

divided by total capital. As at June 30 2020 the group’s debt to asset ratio is 22.96%. (As at Dec 31

2019: 28.20%)

XI. Fair Value

1. Fair value of assets and liabilities measured at fair value

Expressed in RMB

Item

As at June 30 2020

Level 1 fair value

measurement

Level 2 fair value

measurement

Level 3 fair value

measurement

Total

I. Recurring fair value

measurement

-- -- -- --

(3) Other Equity

instruments

32710820.87 32710820.87

III. Non-recurring fair

value measurements

-- -- -- --

Total assets measured

at fair value on a

non-recurring basis

32710820.87 32710820.87

2. Basis for determining the market price of the items measured based on the continuous and

non-continuous first level fair value

3. Items measured based on the continuous or uncontinuous 2nd level fair value valuation

technique as used nature of important parameters and quantitative information

4. Items measured based on the continuous or uncontinuous 3rd level fair value valuation

technique as used nature of important parameters and quantitative information

Items

Fair value

As at

31/12/2019

Valuation

techniques

Unobservable

inputs

Range

(weighted

average)

Unlisted equity

investments

33126730.04 Net asset method Inapplicable N/A

5. Items measured based on the continuous 3rd level fair value sensitivity analysis on adjusted

information and unobservable parameters between the book value at beginning and end of the

period

6. In case items measured based on fair value are converted between different levels incurred in

the current period state the cause of conversion and determine conversion time point

7. Change of valuation technique incurred in the current period and cause of such change

8. Fair value of financial assets and financial liabilities not measured at fair value

The financial assets and financial liabilities of the Group measured at amortized cost mainly include:

cash accounts receivable other receivables short-term loans accounts payable other payables and

long-term payable.In addition to above financial assets and liabilities other financial asset and liabilities that not

measured at fair value the differ between book values and fair value are not significant.

9. Others

The level in which fair value measurement is categorized is determined by the level of the fair value

hierarchy of the lowest level input that is significant to the entire fair value measurement. The levels

are defined as follows:

Level 1 inputs: unadjusted quoted prices in active markets that are observable at the measurement date

for identical assets or liabilities.Level 2 inputs: inputs other than Level 1 inputs that are either directly or indirectly observable for

underlying assets or liabilities.Level 3 inputs: inputs that are unobservable for underlying assets or liabilities.XII. Related parties and related party transactions

1.Information about the parent of the Company

Name

Registration

place

Business nature

Registered

capital (RMB in

ten thousand)

Shareholding

percentage %

Percentage of

voting rights %

Shenzhen

Investment

Holdings Co. Ltd.Shenzhen

Guangdong

province

Investment real

estate

development

guarantee

2764900.00 63.55% 63.55%

The ultimate controlling party of the company is: State-owned Assets Supervision and Management

Commission of Shenzhen Municipal People’s Government

2. Information about the subsidiaries of the Company

For information about the subsidiaries of the Company refer to Note IX.1.

3. Information about joint ventures and associates of the Company

For information about the joint ventures and associates of the Company refer to NoteXI.3.

4. Information on other related parties

Name Related party relationship

Shenzhen Jian ‘an Group Co. Ltd. Same controlling shareholders

Shenzhen Dongfang New world store Co. Ltd Participating stock companies

Shenxi Limited

Not included in Consolidated Financial Statements’

Subsidiary that had been terminated its licenses by law

but not cancellation

Shenzhen Zhentong New Electromechanical Industry

Development Co. Ltd.

Not included in Consolidated Financial Statements’

Subsidiary (Long-term without operation)

Shenzhen Nanyang Hotel Co. Ltd.Not included in Consolidated Financial Statements’

Subsidiary that had been terminated its licenses by law but

not cancellation

Shenzhen Real Estate Electromechanical Management

Company

Not included in Consolidated Financial Statements’

Subsidiary that had been terminated its licenses by law but

not cancellation

Shenzhen Longgang Henggang Huagang Industrial Co.Ltd.Not included in Consolidated Financial Statements’

Subsidiary that had been terminated its licenses by law but

not cancellation

5. Transactions with related parties

(1) Purchases/sales

Purchase of goods/receiving of services

Expressed in RMB

Related party

Nature of

transaction

Jan to Jun 2020

Approved

transaction limit

Whether it exceeds

the transaction limit

Jan to Jun 2019

Shenzhen

RongHua JiDian

Co. Ltd

Elevator

maintenance

554150.94 No 554150.94

Sales of goods/rendering of services

Expressed in RMB

Related party Nature of transaction Jan to Jun 2020 Jan to Jun 2019

Shenzhen Jian'an Group Co.Ltd.

Decoration services 1484806.59 3849090.95

Shenzhen RongHua JiDian

Co. Ltd

Property Services 34435.70 41766.60

(2) Trust/contracting arrangement

Asset management/contracting undertaken by the Group on behalf of related parties:

Note: Inapplicable

Asset management / contracting undertaken by related parties on behalf of the Group:

Expressed in RMB

Name of

trustor/main

contractor

Name of

related party

Type of assets

entrusted/cont

racted

Inception date

of

trust/contracti

ng

Maturity date

of

trust/contracti

ng

Trust/contracti

ng revenue

Trust/contracti

ng revenue

recognized in

June 30 2020

Shantou City

Huafeng Real

Estate

Devepment Co.

Ltd

Shenzhen

Jian'an Group

Co. Ltd.

Construction 19 Oct 2018 1 May 2021 Negotiations 70596511.27

Note: Inapplicable

(3) Leases

Inapplicable

(4) Guarantee

Inapplicable

(5) Funding from related party

Expressed in RMB

Related party Amount of funding

Inception date Maturity date Note

Funds received

Shenzhen Investment

Shareholding Co.Ltd

16535277.94 Nov 11 2006 Dec 22 2016

The principal of the

loan was repaid on 22

December 2016 and

the remaining amount

was interest payable.

Funds provided

(6) Transfer of assets and debt restructuring

Inapplicable

(7) Remuneration of key management personnel

Expressed in RMB

Item Jan to Jun 2020 Jan to Jun 2019

Remuneration of key management

personnel

2252200.00 3506900.00

(8) Other related party transactions

Inapplicable

6. Receivables from and payables to related parties

(1) Receivables from related parties

Expressed in RMB

Item Related party

As at Jun 30 2020 As at Dec 31 2019

Book value

Provision for bad

and doubtful

debts

Book value

Provision for bad

and doubtful

debts

Accounts

receivable

Shenzhen Fresh

Peak property

consultant Co. Ltd

1223645.89 1223645.89 1205588.76 1205588.76

Other receivables

Guangdong

Province Huizhou

Luofu Hill Mineral

10465168.81 10465168.81 10465168.81 10465168.81

Water Co. Ltd

Other receivables

Shenzhen Runhua

Automobile

Trading Co. Ltd

3072764.42 3072764.42 3072764.42 3072764.42

Other receivables

Canada GreatWall

(Vancouver) Co.Ltd

89035748.07 89035748.07 89035748.07 89035748.07

Other receivables

Bekaton Property

Limited

12559290.58 12559290.58 12559290.58 12559290.58

Other receivables Paklid Limited 19450684.59 19450684.59 19319864.85 19319864.85

Other receivables

Shenzhen

Shenfang

Department Store

Co. Ltd.

237648.82 237648.82 237648.82 237648.82

Other receivables

Shenzhen

RongHua JiDian

Co. Ltd

475223.46 23761.17 475223.46 23761.17

Other receivables

Xi’an Fresh Peak

property

management&

Trading Co. Ltd

8419205.19 8419205.19 8419205.19 8419205.19

Other receivables Shenxi Limited 7660529.37 7660529.37 7660529.37 7660529.37

Other receivables

Shenzhen

Nanyang Hotel

Co. Ltd.

3168721.00 3168721.00 3168721.00 3168721.00

Other receivables

Shenzhen Jian'an

Group Co. Ltd.

33517.63 823.21 16464.28 823.21

(2) Payables to related parties

Expressed in RMB

Item Related party As at Jun 30 2020 As at Dec 31 2019

Interest payables

Shenzhen Investment

Shareholding Co. Ltd

16535277.94 16535277.94

Accounts payable

Shenzhen Jian'an Group Co.Ltd.

1952979.95 68172202.04

Other payables

Shenzhen Dongfang New

world store Co. Ltd

902974.64 902974.64

Other payables

Guangdong Province

Fengkai Lain Feng Cement

Manufacturing Co. Ltd.

1867348.00 1867348.00

Other payables

Shenzhen Real Estate

Electromechanical

Management Company

14981420.99 14981420.99

Other payables

Shenzhen Zhentong New

Electromechanical Industry

Development Co. Ltd.

8310832.50 8827940.07

Other payables Shenzhen Shenfang 639360.38 639360.38

Department Store Co. Ltd.

Other payables

Shenzhen Longgang

Henggang Huagang

Industrial Co. Ltd.

165481.09 165481.09

7. Commitments and contingencies

1. Significant commitments

(1 ) Capital commitments

Capital commitments have been entered into but not have not

been in the financial statements

As at June 30 2020 As at Dec 31 2019

Significant outsourcing contracts 183075110.80 200684729.85

Note: The significant outsourcing contract was based on the construction contract between Shantou

Tianyuewan II Project and the contractor Shenzhen Jian'an (Group) Co. Ltd.

(2) Information on implementation of commitments in previous year

For details refer Note XII 5(2).

As at June 30 2020 there is no other material commitment to be disclosed.

2. Contingencies

(1) Contingent liabilities arising from pending arbitration and pending litigation and related financial

impact

Plaintiff Defendant Case

Appellate

court

Amount of

the object of

action

Progress of cases

Xi’an Fresh Peak

Holding limited

company

Xi'an Commercial and Trade

Commission

Xi'an Commerce and Tourism

Co. Ltd.

Investment

compensation

disputes

Shaanxi Higher

People's Court

36.62 million

yuan and

interest

Pending

Note: Xi’an Fresh Peak Holding limited company (hereinafter referred to as “Fresh Peak Company”)

was Sino-foreign joint venture set up in Xi’an city. Among them Fresh Peak Enterprise Co. Ltd made

67% of the shares in cash. Xi’an Trade Building a company directly under the Xi'an Commercial and

Trade Commission (hereinafter referred to as "Xi'an C&T Commission") invested 16% of the shares in

land use rights. Hong Kong Dadiwang Industrial Investment Company holds 17% of the shares. The

core business was property development. And the project was Xi’an Trade Building. The project was

started on 28 November 1995. But the project had been stopped in 1996 because of the two parties’

differences on the operating policy of the project. In 1997 the Xi’an government withdrew the Xi'an

Fresh Peak investment project compulsively and assigned the project to Xi’an Business Tourism Co.

Ltd (hereinafter referred to as “Business Tourism Company”). But the two parties had insulted a

lawsuit on compensation. The ShanXi Province High Peoples Court made a judgement “(2000) SJ-CZ

No.25”. The judgement was as follows: 1. Business Tourism Company had to pay for the compensation

RMB 36620 thousand to Xi’an Fresh Peak Company after the judgment entering into force. If the

Business Tourism Company failed to pay in time it had to pay double debt interests to Xi’an Fresh

Peak Company. 2. Xi’an Joint Commission on Commerce had jointly and severally obligation of the

interests of the compensation.Until 31 December 2019 the amount of RMB 15201000.00 had been called back. The company has

obtained new property clues submitted an application for resumption of execution this case is still

pending.

As at 31 December 2019 the book value of the long-term equity investment of Xi’an Fresh Peak

Company was RMB 32840729.61. The book balance of assets was RMB 8419205.19. Both have

been taken full provision for impairment loss.

(2) Contingent liabilities arising from guarantee provided to other entities and related financial effects.

As at 31 December 2019 The Group follows the real estate operating routine provides a total of

47593.67 (RMB in ten thousand) mortgage guarantee to real estate buyers.

Item Duration

Amount (I

n ten thou

sand)

Note

Shengfang CuiLin Building

Until the Premises Permit mortgage registration

is finished and in bank custody

10273.65

ChuanQi DongHu Building

(Former DongHuDiJing

Building)

Until the Premises Permit mortgage registration

is finished and in bank custody

8116.93

TianYue Bay No.1

Until the Premises Permit mortgage registration

is finished and in bank custody

18894.00

Total 37284.58

(3 ) Other contingencies

For contingent liabilities related to joint venture or associate investment please refer to Note IX3(2).

As at June 30 2020 there is no other contingency to be disclosed.

8. Others

Inapplicable

XIII. Stock payment

1. General

Inapplicable

2. Stock payment for equity settlement

Inapplicable

3. Stock payment for cash settlement

Inapplicable

4. Correction and termination of stock payment

Inapplicable

5. Others

XIV. Commitments and contingencies

1. Important commitments

Inapplicable

2. Other contingencies

(1) Significant contingencies existing as at the balance sheet date

Inapplicable

(2) Important contingencies unnecessary to be disclosed but necessary to be explained

As of June 30 2020 there exist no other contingencies in the Group necessary to be disclosed.

3. Others

Inapplicable

XV. Post balance sheet date events

1. Significant non-adjustment events

Inapplicable

2. Profit distribution

Inapplicable

3. Sales return

Inapplicable

4. Note to other matters after the balance sheet date

Since January 2020 pneumonia caused by COIVD-19 is spreading across the country. The prevention

of pneumonia is continuing nationwide. The Group follows the arrangement of State-owned Assets

Supervision and Administration Commission of the People’s Government of Shenzhen Municipal and

the Shenzhen Investment Holding Co. Ltd. combined with the actual situation of the leased property

within the group planned to make a reduction of rents for more than 300 companies and individuals for

two-month total amount about RMB10000000.

As of the financial report issuance date there are no other events after the balance sheet date to be

disclosed.XVI. Other significant events

1. Correction of the accounting errors in the previous period

(1) Retroactive restatement

Inapplicable

(2) Prospective application

Inapplicable

2. Liabilities restructuring

Inapplicable

3. Replacement of assets

(1) Non-monetary assets exchange

Inapplicable

(2) Other assets exchange

Inapplicable

4. Pension plan

Inapplicable

5. Discontinuing operation

Inapplicable

6. Segment information

(1) Basis for determining the reporting segments and accounting policy

Inapplicable

(2) Financial information of the reporting segments

Inapplicable

(3) In case there is no reporting segment or the total assets and liabilities of the reporting

segments cannot be disclosed explain the reason

Inapplicable

(4) Other notes

Inapplicable

7. Other significant transactions and matters that may affect investors' decision making

From 14 September 2016 the Group planned the reorganization of material assets. The Group

announced it intended to buy 100% stock equity of Evergrande real estate group co. LTD by issue

shares or cash payment on 14 October 2016. Guangzhou Chiron real estate co. LTD will become the

controlling shareholder of the company after the acquisition.The restructuring of material assets is still in process as scheduled by the financial report day.

8. Others

Inapplicable

XVII. Notes to the parent company’s financial statements

1. Accounts receivable

(1) Accounts receivables disclosed by categories

Expressed in RMB

Item As at Jun 30 2020 As at Dec 31 2019

Book balance

Provision for

bad and

doubtful debts Carryin

g

amount

Book balance

Provision for bad

and doubtful

debts

Carrying

amount

Amount

Proporti

on

Amount

Provisio

n

proporti

on

Amount

Proporti

on

Amount

Provisio

n

proporti

on

Individually

assessed for

impairment

individually

107072

24.66

98.12%

106264

36.84

100.00

%

80787.8

2

106264

36.84

98.51%

106264

36.84

100.00%

Including:

Collectively

assessed for

impairment based

on credit risk

characteristics

205630.

01

1.88% 3564.22 2.22%

202065.

79

160500.

06

1.49% 3564.22 2.22%

156935.8

4

Include:

Accounts

receivable from

related parties in

consolidated scope

89215.6

9

0.82% 0.00 0.00%

89215.6

9

89215.6

9

0.83% 89215.69

Accounts

receivable from

sales of properties

116414.

32

1.07% 3564.22 5.00%

112850.

10

71284.3

7

0.66% 3564.22 5.00% 67720.15

Total

109128

54.67

100.00

%

106300

01.06

98.55%

282853.

61

107869

36.90

100.00%

106300

01.06

98.55%

156935.8

4

Provision made on an individual basis: Sales of properties for long-term uncollected

Expressed in RMB

Item

As at Jun 30 2020

Book balance

Provision for bad

and doubtful debts

Percentage of

provision

Rationale of

Provision

Amount receivables of

sales of properties for

long-term uncollected

10707224.66 10626436.84 100.00%

Expected to be not

recoverable

Total 10626436.84 10626436.84 -- --

Individual provision for bad and doubtful debts:

Expressed in RMB

Item As at Jun 30 2020

Book balance Bad debt reserve Provision proportion Provision reason

Provision for bad debts based on portfolio: Related parties within the scope of consolidation

Expressed in RMB

Item

As at Jun 30 2020

Book balance Bad debt reserve Provision proportion

Over three years 89215.69 0.00%

Total 89215.69 --

Note to the basis for determining the combination:

Inapplicable

Total provision for bad and doubtful debts based on portfolio:

Expressed in RMB

Item

As at Jun 30 2020

Book balance Bad debt reserve Provision proportion

Within 1 year 49896.32 238.32 5.00%

1 to 2 years 66518.00 3325.90 5.00%

Total 116414.32 3564.22 --

Note to the basis for determining the combination:

Inapplicable

Total provision for bad and doubtful debts based on portfolio:

Inapplicable

Note to the basis for determining the combination:

Inapplicable

Disclosed based on aging

Expressed in RMB

Aging As at Jun 30 2020

Within 1 year (with 1 year inclusive) 125917.77

1-2 year 155733.69

Above 3 year 10631203.21

Above 5 year 10631203.21

Total 10912854.67

(2) Provision recovery or reversal of reserve for bad debts during the reporting period

Inapplicable

(3) Accounts receivable written off in current period

Inapplicable

(4) Accounts receivable owed by the top five debtors based on the ending balance

Expressed in RMB

Description of Units As at June 30 2020

Proportion of the ending

balance of the accounts

receivable

Provision for bad debts as at

June 30 2020

Daxing Auto Parts Co. Ltd. 2075881.79 19.02% 2075881.79

Shenzhen Xinfeng Real

Estate Consulting Co. Ltd.

1223645.89 11.21% 1223645.89

Wang Weidong 1200000.00 11.00% 1200000.00

Wang Guodong 821272.45 7.53% 821272.45

Cai Guangyao 876864.11 8.04% 876864.11

Total 6197664.24 56.80%

(5) Account receivable with recognition terminated due to transfer of financial assets

Inapplicable

(6) Amount of assets and liabilities formed through transfer of account receivable and continuing

to be involved

Inapplicable

2. Other receivables

Expressed in RMB

Items As at Jun 30 2020 As at Dec 31 2019

Other receivables 1122154158.12 835275498.69

Total 1122154158.12 835275498.69

(1) Interest receivable

1) Classification of interest receivable

Inapplicable

2) Significant overdue interest

Inapplicable

3) Provision for bad debts

Inapplicable

(2) Dividends receivable

1) Classification of dividends receivable

Inapplicable

2) Significant dividends receivable with age exceeding 1 year

Inapplicable

3) Provision for bad debts

Inapplicable

(3) Other receivables

1) Classification of other receivables based on nature of payment

Expressed in RMB

Category As at June 31 2020 As at Dec 31 2019

Amount receivables from government 721755.80 721755.80

Accounts receivable from employee’s

inprest fund

152691.21 182691.21

Amount receivables of the collecting

and paying on another's behalf

7472.22 3248.36

Amount receivables of other

customers

11431203.21 6818306.11

Amount receivables of related parties 143140616.12 135567522.22

Amount receivables in consolidated

scope

1767695750.60 1492977306.03

Total 1923149489.16 1636270829.73

2) Provision for bad debts

Expressed in RMB

Bad debt reserve

The 1st stage The 2nd stage The 3rd stage

Total Predicted credit

loss in the Total

Predicted credit loss in

the whole duration (no

Predicted credit loss in

the whole duration

future 12 months credit impairment taken

place)

(credit impairment

already taken place)

Balance as at Jan 01

2020

81118.11 660150746.68 140763466.25 800995331.04

Balance as at Jan 01

2020 durning current

period

—— —— —— ——

Balance as at June 30

2020

81118.11 660150746.68 140763466.25 800995331.04

Movement of the book balance of provision for loss with significant amount in the reporting period

Inapplicable

Disclosed based on aging：

Expressed in RMB

Aging As at Jun 30 2020

Within 1 year (with 1 year inclusive) 89981136.31

1 to 2 years 140180572.84

2 to 3 years 142778168.63

Over 3 years 1550209611.38

4 to 5 years 1550209611.38

Total 1923149489.16

3) Provision recovery or reversal of reserve for bad debts during the reporting period

Inapplicable Where the significant amount of the provision for bad debt recovered or reversed:

4) Accounts receivable actually written off in the reporting period

Inapplicable

5) Accounts receivable owed by the top five debtors based on the ending balance

Expressed in RMB

Name of Entity

Relationship

with the group

As at Jun 30 2020 Aging

Proportion of the

amount to the

total OR

Bad debt provision

Shantou Huafeng

Estate Development

Co. Ltd

Subsidiary

732384395.50

Within 1 year. 1-3

years. More than

3 years

38.08%

Fresh Peak

Enterprise Co. Ltd

Subsidiary

545999208.06

Within 1 year.More than 3 years

28.39% 508377320.74

Shenzhen Shenfang

Group Longgang

Development Co.

Ltd.Subsidiary 237997397.18 Within 1 year 12.38%

American Great

Wall Co. Ltd

Subsidiary

103403196.15 More than 3 years 5.38% 103403196.15

Fresh Peak Zhiye

Co. Ltd.

Subsidiary

90966169.62 More than 3 years 4.73% 90363926.75

Total -- 1710750366.51 -- 88.96% 702144443.64

6) Accounts receivable involving government subsidy

Inapplicable

7) Other receivables with recognition terminated due to transfer of financial assets