ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
SHENZHEN SPECIAL ECONOMIC ZONE REAL ESTATE &
PROPERTIES (GROUP) CO. LTD.ANNUAL REPORT 2022
【March 2023】
1ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
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.Tang Xiaoping the Company’s General Manager Wang Jianfei the Company’s Chief Financial
Officer 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 Board has approved a final dividend plan as follows: based on the total share capital of
1011660000 shares a cash dividend of RMB0.61 (tax inclusive) per 10 shares is to be distributed
to the shareholders with no bonus issue from either profit or capital reserves.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.
2ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Table of Contents
Part I Important Notes Table of Contents and Defin... 2
Part II Corporate Information and Key Financial In... 6
Part III Management Discussion and Analysis ........ 10
Part IV Corporate Governance ....................... 30
Part V Environmental and Social Responsibility ..... 47
Part VI Significant Events ......................... 48
Part VII Share Changes and Shareholder Information.. 56
Part VIII Preference Shares ........................ 62
Part IX Bonds ...................................... 63
Part X Financial Statements ........................ 64
3ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Documents Available for Reference
1. The financial statements with the personal signatures and stamps of the Company’s general manager
Chief Financial Officer and head of the financial department;
2. The original of the Auditor’s Report with the stamp of the CPA firm as well as the personal
signatures and stamps of the CPAs; and
3. The originals of all the documents and announcements disclosed by the Company on Securities Times
China Securities Journal and Ta Kung Pao during the Reporting Period.
4ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Definitions
Term Definition
The State-owned Assets Supervision and Administration Commission of the
“Shenzhen SASAC” or the “Municipal SASAC”
People’s Government of Shenzhen Municipal
SIHC Shenzhen Investment Holdings Co. Ltd.ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. and
The “Company” the “Group” “SPG” or “we”
its consolidated subsidiaries except where the context otherwise requires
Shenzhen Property Management Shenzhen Property Management Co. Ltd.Petrel Hotel Shenzhen Petrel Hotel Co. Ltd.Zhentong Engineering Shenzhen Zhentong Engineering Co. Ltd.Huazhan Construction Supervision Shenzhen Huazhan Construction Supervision Co. Ltd.Jianbang Group Guangdong Jianbang Group (Huiyang) Industrial Co. Ltd.Chuanqi Real Estate Development Shenzhen SPG Chuanqi Real Estate Development Co. Ltd.
5ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Part II Corporate Information and Key Financial Information
I Corporate Information
Stock name SPG SPG-B Stock code 000029 200029
Stock exchange for stock
Shenzhen Stock Exchange
listing
Company name in Chinese 深圳经济特区房地产(集团)股份有限公司
Abbr. 深房集团
Company name in English (if
ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd.any)
Abbr. (if any) SPG
Legal representative Liu Zhengyu
Registered address 45/F-48/F SPG Plaza Renmin South Road Luohu District Shenzhen Guangdong P.R.China
Zip code 518001
Changes of the registered
N/A
address
Office address 47/F SPG Plaza Renmin South Road Luohu District Shenzhen Guangdong P.R.China
Zip code 518001
Company website http://www.sfjt.com.cn
Email address spg@sfjt.sihc.com.cn
II Contact Information
Board Secretary Securities Representative
Name Luo Yi Hong Lu
47/F SPG Plaza Renmin South Road 47/F SPG Plaza Renmin South Road
Address Luohu District Shenzhen Guangdong Luohu District Shenzhen Guangdong
P.R.China P.R.China
Tel. （86 755）25108897 （86 755）25108837
Fax （86 755）82294024 （86 755）82294024
Email address spg@sfjt.sihc.com.cn spg@sfjt.sihc.com.cn
III Media for Information Disclosure and Place where this Report Is Lodged
Stock exchange website where this Report is disclosed Shenzhen Stock Exchange (http://www.szse.cn/)
Domestic: Securities Times China Securities Journal and
Newspaper and website where this Report is disclosed http://www.cninfo.com.cn
Overseas: Ta Kung Pao (HK)
47/F SPG Plaza 3005 Renmin South Road Luohu District Shenzhen
Place where this Report is lodged
Guangdong P.R.China
IV Change to Company Registered Information
Unified social credit code 91440300192179585N
Change to principal activity of the
No change
Company since going public (if any)
6ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
On 24 March 1999 the controlling shareholder was changed from Shenzhen
Every change of controlling shareholder Investment Management Co. Ltd. to Shenzhen Construction Investment Holdings Co.since incorporation (if any) Ltd. And on 14 February 2006 it was changed to Shenzhen Investment Holdings Co.Ltd.V Other Information
The independent audit firm hired by the Company:
Name Grant Thornton China
Office address 5/F Sci-Tech Plaza 22 Jianguomenwai Avenue Chaoyang District Beijing
Accountants writing signatures Zhao Juanjuan and Jiang Xiaoming
The independent sponsor hired by the Company to exercise constant supervision over the Company in the Reporting Period:
□ Applicable □ Not applicable
The independent financial advisor hired by the Company to exercise constant supervision over the Company in the Reporting Period:
□ Applicable □ Not applicable
VI Key Financial Information
Indicate by tick mark whether there is any retrospectively restated datum in the table below.□ Yes □ No
2022-over-2021
202220212020
change (%)
Operating revenue
634384561.421320790648.45-51.97%1615009713.88
(RMB)
Net profit attributable to
the listed company’s 153718805.57 220836309.93 -30.39% 290229772.23
shareholders (RMB)
Net profit attributable to
the listed company’s
shareholders before 21160405.11 208306710.37 -89.84% 253595334.11
exceptional gains and
losses (RMB)
Net cash generated
from/used in operating -675775998.76 -1205952107.94 43.96% 285164013.17
activities (RMB)
Basic earnings per share
0.15190.2183-30.42%0.2869
(RMB/share)
Diluted earnings per
0.15190.2183-30.42%0.2869
share (RMB/share)
Weighted average return
3.88%5.72%-1.84%7.81%
on equity (%)
Change of 31
31 December 2022 31 December 2021 December 2022 over 31 December 2020
31 December 2021 (%)
Total assets (RMB) 5689769802.18 6182498050.43 -7.97% 4936916746.74
Equity attributable to the
listed company’s 4004240547.70 3938260291.97 1.68% 3797512488.22
shareholders (RMB)
Indicate by tick mark whether the lower of the net profit attributable to the listed company’s shareholders before and after exceptional gains
and losses was negative for the last three accounting years and the latest independent auditor ’s report indicated that there was uncertainty
about the Company’s ability to continue as a going concern.□ Yes □ No
Indicate by tick mark whether the lower of the net profit attributable to the listed company’s shareholders before and after exceptional gains
and losses was negative.□ Yes □ No
7ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
VII Accounting Data Differences under China’s Accounting Standards for Business Enterprises
(CAS) and International Financial Reporting Standards (IFRS) and Foreign Accounting
Standards
1. Net Profit and Equity under CAS and IFRS
□ Applicable □ Not applicable
Unit: RMB
Net profit attributable to the listed company’s Equity attributable to the listed company’s
shareholders shareholders
2022 2021 Ending amount Beginning amount
Under CAS 153718805.57 220836309.93 4004240547.70 3938260291.97
Adjusted as per IFRS
Under IFRS 153718805.57 220836309.93 4004240547.70 3938260291.97
2. Net Profit and Equity under CAS and Foreign Accounting Standards
□ Applicable □ Not applicable
No difference for the Reporting Period.
3. Reasons for Accounting Data Differences Above
□ Applicable □ Not applicable
VIII Key Financial Information by Quarter
Unit: RMB
Q1 Q2 Q3 Q4
Operating revenue 272594952.10 93589546.80 160169563.23 108030499.29
Net profit attributable to the
162278083.59-17149753.45-20007368.5528597843.98
listed company’s shareholders
Net profit attributable to the
listed company’s shareholders
37225453.61-20086291.05-20271993.0024293235.55
before exceptional gains and
losses
Net cash generated from/used in
-461062516.92-87052626.42-62497846.24-65163009.18
operating activities
Indicate by tick mark whether any of the quarterly financial data in the table above or their summations differs materially from what have
been disclosed in the Company’s quarterly or interim reports.□ Yes □ No
IX Exceptional Gains and Losses
□ Applicable □ Not applicable
Unit: RMB
Item 2022 2021 2020 Note
Mainly due to income
Gain or loss on disposal of non-current
from disposal of
assets (inclusive of impairment 161542599.57 -13451.61 11429.23
allowance write-offs) interest in subsidiary in
2022
Government subsidies charged to
current profit or loss (exclusive of
government subsidies consistently given Government grants
559803.191669479.403370769.21
in the Company’s ordinary course of received
business at fixed quotas or amounts as
per government policies or standards)
8ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Change in fair value of
Gain or loss on assets entrusted to other monetary fund
9129650.5113024710.9115217058.60
entities for investment or management investments and return
on investment
Debt restructuring
Gain or loss on debt restructuring 2610128.31
income
Reversed portions of impairment
allowances for receivables which are 482790.04
tested individually for impairment
Non-operating income and expense
1094190.561542604.0129009657.60
other than the above
Other gains and losses that meet the
1237002.86
definition of exceptional gain/loss
Less: Income tax effects 41451680.41 4176533.19 12211479.38
Non-controlling interests effects
926291.27
(net of tax)
Total 132558400.46 12529599.56 36634438.12 --
Details of other gains and losses that meet the definition of exceptional gain/loss:
□ Applicable □ Not applicable
No such cases for the Reporting Period.Explanation of why the Company reclassifies as recurrent an exceptional gain/loss item listed in the Explanatory Announcement No. 1 on
Information Disclosure for Companies Offering Their Securities to the Public—Exceptional Gain/Loss Items:
□ Applicable □ Not applicable
No such cases for the Reporting Period.
9ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Part III Management Discussion and Analysis
I Industry Overview for the Reporting Period
The Company is subject to the information disclosure requirements for the real estate industry in the Disciplinary and Regulatory Guideline
No. 3 of the Shenzhen Stock Exchange for Listed Companies—Industry-specific Information Disclosure.The real estate sector embraced a policy recovery in 2022 thanks to a constant number of favorable policies introduced
by the regulatory authorities to advance the sound and steady development of the real estate market. Specifically the
combo of policies focusing on three financing channels namely credit bonds and equities was put in place in
November re-opening the refinancing channels for the listed real estate enterprises and listed enterprises engaged in
real estate business which was expected to relieve the financial pressure on the real-estate enterprises. Concurrently
cities across China implemented policies based on local conditions. To restore house purchasers’ confidence the
government decreased the downpayment percentage and house loan interest rate and increased the provident fund loan
limit. Finally the policies’ effectiveness gradually manifested.II Principal Activity of the Company in the Reporting Period
The Company is subject to the information disclosure requirements for the real estate industry in the Disciplinary and Regula tory Guideline
No. 3 of the Shenzhen Stock Exchange for Listed Companies—Industry-specific Information Disclosure.The Company primarily develops residential properties. During the Reporting Period it had six available-for-sale
projects which are mainly located in Shenzhen Huizhou and Shantou. They are: the Chuanqi Donghu Mingyuan
project and the Cuilinyuan project in Shenzhen the Linxinyuan Phase I project located in a place in Huizhou that is
close to Shenzhen and the Tianyuewan project the Yuejing Dongfang project and the Jinyedao project in Shantou. In
addition the Company had two under-construction projects i.e. the Guangmingli project in Guangming District
Shenzhen and the Linxinyuan project located in a place in Huizhou that is close to Shenzhen.New additions to the land bank:
Considerati
Floor area Total land on of the
Name of How the The
Planned Site area with plot price Company’s
land lot or Location land is Company’s
use of land （㎡） ratio (RMB’000 interest
project obtained interest
（㎡） 0) (RMB’000
0)
Cumulative land bank:
Floor area available for
Name of project/area Site area（0000 ㎡） Floor area（0000 ㎡）
development（0000 ㎡）
Xinfeng Building in Shantou 0.59 2.66 2.66
Linxinyuan Phase II 2.57 7.72 7.72
Linxinyuan Phase III 4.31 9.57 9.57
Linxinyuan Phase IV 3.23 6.45 6.45
Total 10.70 26.40 26.40
Development status of major projects:
Plann Floor Cumu Expec Cumu
The
Time for
Co % Site
ed area lativel ted lative
City/ Name commenc %
Locat mpa deve area
floor compl y total investregio of Status ement of constr （㎡ area eted compl invest ment ion ny’s lopen project constructi ucted with in the eted ment (RMB
inte don ） plot Curre floor (RMB ’0000
rest
ratio nt area ’0000 )
10ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022（㎡ Period （㎡ )）（㎡）
）
Frame
Linxin work
Huiz Huiy 51.0 11 June 94.00 6427 1597 1157 1091
yuan in 94%
hou ang
Phase I constr 0% 2021 % 8 61 50 27
uction
Guan Found
SPG gmin ation 100. 19
Shen 70.00 1072 5360 1517 1068
Guang g pit 00 January 70%
zhen
mingli Distri being % 1 5 58 76 % 2022
ct built
Sales status of major projects:
Pre-
Floor Pre-sale/sa
Cumul area sale/sales Floor
Floor Floor atively pre- area les revenu
Cumul revenu
The area area pre- sold/so e settled
atively
Compa with availab sold/so ld in genera in the
e
City/re Name of Locati settled
Status ny’s plot le for ld the
settled
te in Curren
gion project on floor in the
interes ratio sale floor Curren the t
area Current （㎡ （㎡ area t Curren Periodt） ） （㎡ Period(㎡)
t （㎡（㎡ Period ） Period ）
(RMB’
） (RMB’ 0000)
0000)
Chuanqi
Luohu Read
Shenz Donghu 100.00
Distric y for 55727 32857 32663 246 1606 32663 2651 16166
hen Mingyu
t sale %
an
Longg
Read
Shenz Cuilinyu ang 100.00
y for 60111 56137 52884 915 2755 52884 915 2469
hen an Distric
sale %
t
Chaoy
Tianyue Read
Shanto ang 100.00 15347 16037 11488 10165
wan y for 4998 2844 9131 4793
u Distric
Phase I sale % 0 2 4 5
t
Chaoy
Tianyue Read
Shanto ang 100.00 12777 13705
wan y for 28271 11580 6537 25512 13995 7295
u Distric
Phase II sale % 0 9
t
Huiya
Linxiny On
Huizh ng 51.00 15976 15976
uan pre- 2792 2236 2558
ou Distric
Phase I sale % 1 1
t
Rental status of major projects:
Cumulative
Name of The Company’s Rentable area Average
Location Use rented area
project interest （㎡） occupancy rate
（㎡）
Real Estate Shenzhen Commercial
100.00%3413.882436.6071.37%
Mansion
North Tower of Shenzhen Commercial
Guoshang 100.00% 4819.71 4819.71 100.00%
Mansion
Petrel Building Shenzhen Commercial 100.00% 22475.47 22475.47 100.00%
SPG Plaza Shenzhen Office building 100.00% 61005.82 30523.92 50.03%
Podium of SPG Shenzhen Commercial
100.00%19896.3016123.4981.04%
Plaza
Wenjin Garden Shenzhen Commercial 100.00% 3531.60 3531.60 100.00%
Primary land development:
□ Applicable □ Not applicable
Financing channels:
Financing Ending balance Financing cost Maturity structure
11ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
channel of financings range/average financing 2-3
cost Within 1 year 1-2 years Over 3 years years
Bank loans 60366770.99 4.15%-4.20% 6105770.99 54261000.00
Total 60366770.99 6105770.99 54261000.00
Development strategy and operating plan for the coming year:
Please refer to “XI Prospects” in this part of the Report.Provision of guarantees for homebuyers on bank mortgages:
□ Applicable □ Not applicable
Guarantee amount (RMB’
Project Guarantee period Note
0000)
Until the property ownership certificate is registered as collateral and
Shanglinyuan 107.49
handed over to bank for keeping
Cuilinyuan Until the property ownership certificate is registered as collateral and
2174.37
handed over to bank for keeping
Chuanqi Donghu Until the property ownership certificate is registered as collateral and
1820.33
Mingyuan handed over to bank for keeping
Tianyuewan Until the property ownership certificate is registered as collateral and
36056.20
handed over to bank for keeping
Total 40158.39
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
As % of As % of the Compatibilit
Cumulativ
Investment total peak of Disinvestm y of actual
Project Type of investor e returns
amount (RMB) investmen project ent investment
(RMB)
t funds and returns
Director supervisor
or senior
Linxinyuan 8950000.00 39.25% 0.90% 0.00 N/A N/A
management of the
Company
III Core Competitiveness Analysis
As a pioneer of real estate development enterprises in Shenzhen the Company has created a number of "first places" in
the history of real estate development in China. For example the first to use the paid state-owned land the first to
introduce the foreign investment for the cooperative land development the first to raise development funds by means
of pre-sale of buildings the first to carry out public bidding for construction projects in accordance with international
practices the first to set up a property management company to the buildings and residences developed in an all-
rounded manner the first to win the bid in the auction of land use rights held in the Shenzhen Special Economic Zone
etc.Over the past 40 years the Company has developed more than 100 high-rise buildings 500 multi-storey residential
buildings and 400 garden villas with a cumulative building area of more than 4 million square meters. It has paid great
efforts to 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 its planning construction cost control sales ability and brand image have been effectively
improved. More importantly its main business operation ability and core competitiveness have been greatly enhanced.The Company has been granted the titles of “Socially Responsible Company” and “Honest (Quality) Company”
in the real estate sector of Shenzhen for two consecutive years.
12ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
IV Core Business Analysis
1. Overview
In 2022 strictly following relevant laws regulations and the Company’s policies and adhering to the principle of being
responsible for all shareholders of the Company the Board of Directors of the Company kept improving its corporate
governance capability and strictly implemented all resolutions of the Shareholders’ General Meeting thereby operating
in a standard and efficient manner. All directors of the Company earnestly performed their duties and responsibilities
granted by shareholders effectively safeguarding the legitimate rights and interests of the Company and its
shareholders.A. Operating results of the Company
During the Reporting Period the Company recorded operating revenue of RMB634.3846 million down 51.97% year
on year; and a net profit attributable to shareholders of the Company as the parent of RMB153.7188 million down
30.39% year on year. As of the end of the Reporting Period equity attributable to shareholders of the Company as the
parent stood at RMB4004.2405 million representing an increase of RMB65.9803 million as compared to a year ago.B. Review of Operations Management in 2022
Facing an increasingly complex external context and tougher reform and development tasks in 2022 the Company
conscientiously implemented the decisions and arrangements of the State-owned Assets Supervision and
Administration Commission of the People’s Government of Shenzhen Municipal (Municipal SASAC) and Shenzhen
Investment Holdings Co. Ltd. (SIHC). Concurrently all SPG employees worked in unity and stayed determined to
improve operations management and advance various tasks in all respects. With all these unremitting efforts a new
chapter in the high-quality development of the Group was written. Major work progress for the Reporting Period is as
follows:
a. Focusing on development projects the Company achieved new progress in the core business
Project construction: By strengthening the coordination with municipally-owned enterprises including Shenzhen
General Institute of Architectural and Research Co. Ltd. Shenzhen Water Planning & Design Institute Co. Ltd. and
Shenzhen Municipal Engineering Corp. the construction of the Guangmingli project progressed rapidly with the
soldier piles engineering piles earthmoving and anchor cable and breast beam works having been completed and the
floor underlayment and anti-floating anchors in construction. Additionally the structures of Buildings 1 to 8 of
Linxinyuan Phase I and the basements of Phase II were completed.Real estate sales: The Company strengthened project promotion through multiple channels for the purpose of customer
base expansion. It also accelerated the pace of destocking. As a result Chuanqi Donghu Mingyuan and Cuilinyuan in
Shenzhen had only a few housing units left for sale. Concerning the Shantou Tianyuewan project approximately 75%
of units in Phase I and 20% in Phase II were sold. Concurrently the units in Linxinyuan that have been sold represent
approximately 3% of the total of the project. The sales area for the year totaled 20.1 thousand square meters and the
new contracted sales reached RMB165 million.Rental business: The Company took pronged measures to expand the customer source. As a result it recordedRMB53.8703 million in rental revenue for the year. Additionally SPG Plaza was included among the “Buildings forShenzhen-Hong Kong Medical and Healthcare Specialty Industry”.b. Focusing on the maintenance of stable safety protection the Company newly consolidated the safety barrier
13ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
First the Company fully assumed its principal responsibility for safe production by requiring all levels ranging from
the Chairman to general employees to sign the safe production responsibility letter doing so to ensure that the safe
production accountability system for all employees would be thoroughly implemented. To this end the Company
carried out 254 potential risk inspections throughout the year with more than 1000 potential risks inspected and
remedied. Additionally 52 educational and training activities on safe production were organized in the year providing
training for more than 2800 employees. Thanks to these efforts the line of defense for safe production was fully
strengthened with no safety incidents occurring in the Group throughout the year. Second the Company organized and
carried out work for public opinion management complaint petition response information publicity cybersecurity and
confidentiality management. As a result no material negative public opinion incidents occurred during the Reporting
Period.c. Focusing on guarantee services the Company newly maintained the corporate stability
First the Company renewed the liability insurance for directors supervisors and senior managers in 2022 to provide a
necessary guarantee for the performance of duties by directors supervisors and senior managers of the Company. It
purchased critical illness insurance and group accident supplementary medical insurance for employees to enhance
employees’ ability to resist risks. Second the Company completed talent introduction for ten urgent positions further
enhancing workforce development. Third project financing was put in place. The development loan project of
RMB500 million for Chuanqi Real Estate Development was completed fully guaranteeing project development and
operation. Fourth accounts receivable management was strengthened with RMB414 million of funds recovered in
total guaranteeing the Company’s operation. Fifth the Company fulfilled its tax obligation by laws and regulations. It
paid RMB619 million in taxes and got RMB132 million in tax rebates. Sixth the Company upgraded its official
website and OA system effectively improving its brand image and office efficiency.d. Focusing on internal control and internal audit the Company newly strengthened the operations
management
First the Company prepared the key tasks for 2022 and decomposed business targets and key tasks. Additionally it
held work meetings every month to make unified arrangements for the completion of key tasks and supervise the
implementation of these arrangements. Second the Company proactively advanced the streamlining of its policies and
procedures. It drafted and revised eight policies for safe production and human resource management further
standardizing its policy management system. Third the Company completed the disclosure of 50 items on the
procurement platform and ten public bidding invitations in strict accordance with the procurement management
regulations. Fourth the Company stepped up efforts at internal audit. It completed seven special audits and audits
respectively. Fifth contract review was strengthened. The Company reviewed 313 contracts throughout the year
achieving a contract review rate of 100%. Concurrently it properly dealt with 15 lawsuits. Sixth the Company
attached great importance to the budget and settlement regarding major projects. Statistically it prepared 17 budgets
and completed 21 settlement audits and the reduction in the budget and settlement upon review reached RMB8.13
million.e. Focusing on the affiliates the Company added new impetus to its business development
First market expansion: Zhentong Engineering recorded 43 contracted projects throughout the year with the contract
value totaling RMB140 million. Petrel Hotel successfully achieved tourism transformation and Floors 16 19 and 28
of Petrel Building with a combined area of 3600 square meters were successfully leased out. Huazhan Construction
Supervision secured the project supervision business of the Guangmingli project. Second business management: Petrel
14ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Hotel pushed ahead with “downsizing for efficiency” to strengthen workforce management and improve efficiency.Zhentong Engineering advanced risk control in all respects and achieved positive progress in the recovery of funds for
construction projects that had been tied up and the notes receivable due. Huazhan Construction Supervision refined its
risk control system and strengthened on-site supervision to improve the quality and safety of construction projects.Shantou branch improved its performance appraisal mechanism to motivate employees. Additionally the Company
successfully completed the transfer of equities of Shenzhen Property Management and Yunnan Kunpeng Air Service
Co. Ltd. and properly handled complicated issues such as the profit audit during the transition period and settlement
of legacy accounts receivable and payable. Existing real estate including the land of Great Wall Estate Co. Inc. (U.S.)
and Guoshang Mansion was listed on The Stock Exchange of Hong Kong Limited marking a breakthrough in quality
and efficiency improvement.f. Focusing on the leadership of Party building the Company newly strengthened Party building
First the implementation of the responsibilities for Party building was strengthened. Party organizations of the Group
thoroughly learned the guiding principles of the 20th National Congress of the Communist Party of China through the
“First Topics”. They adhered to the leadership of the guiding principles of the 20th National congress of the
Communist Party of China and elevated the leading role of Party organizations to a new high. Special remediation was
advanced strictly and rapidly with 170 special remediation tasks on the list completed effectively and efficiently.Additionally the development of the “One Brand for One Enterprise” Party building brand was advanced on an
ongoing basis via the construction of the “Safe SPG Bright Project”. Moreover the “massive learning thoroughresearch and full implementation” working mechanism was implemented. Specifically 35 leadership members of the
Group conducted in-depth research at the paired enterprises. In the process issues such as community-level Party
building and services for the community level were addressed. The “I do practical things for the masses” practical
activity was carried out regularly. Additionally the renovation of Xiabei Village Primary School in Longdu Town
Chenghai District Shantou City and the helpful project of improving the learning and living environment of primary
school students in Longdu Town were completed according to the arrangements of the Party Committee of SIHC fully
demonstrating the Company’s sense of responsibility as a state-owned enterprise.Second the constraint of rigorous Party self-governance was enhanced. The Company persevered with the “oneposition and two responsibilities” system and arranged for the signature of the responsibility letter for improving Party
conduct and ensuring integrity to decompose and fully implement the responsibilities. It strictly practiced the principles
of the central Party leadership’s eight-point decision on improving conduct and implemented the regulations of thesuperior unit regarding the holidays. Moreover close attention was paid to the “pointless formalities bureaucratismhedonism and extravagance” issue tending to occur during major holidays to ensure the supervision of conduct
improvement during holidays. Additionally the Integrity Education and Learning Activity Program was drafted and
issued to guide the educational and learning activities of the Group for the year. The implementation of the mandatory
integrity topic system in the Party branch’s learning activities was promoted to carry out practice integrity learning and
education from multiple perspectives and at multiple levels. By doing so the “no desire to be corrupt” self-discipline
mechanism was further enhanced and thus the ideological line of defense for integrity and self-discipline was
consolidated.
15ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
2. Revenue and Cost Analysis
(1) Breakdown of Operating Revenue
Unit: RMB
20222021
As % of total As % of total Change (%)
Operating revenue operating revenue Operating revenue operating revenue
(%)(%)
Total 634384561.42 100% 1320790648.45 100% -51.97%
By operating division
Property sales 309331841.57 48.76% 876161088.60 66.34% -64.69%
Engineering and
241209525.7938.02%200259571.1615.16%20.45%
construction
Property
36660871.835.78%162526580.1812.31%-77.44%
management
Rental service 53870265.26 8.49% 81791161.56 6.19% -34.14%
Other 5552040.91 0.88% 15776937.12 1.19% -64.81%
Eliminated internal
transactions and -12239983.94 -1.93% -15724690.17 -1.19% 22.16%
accounts
By product category
Residential units 277643154.35 43.77% 875153000.99 66.26% -68.27%
Shops and parking
31688687.225.00%1008087.610.08%3043.45%
lots
Other 337292703.79 53.17% 460354250.02 34.85% -26.73%
Eliminated internal
transactions and -12239983.94 -1.93% -15724690.17 -1.19% 22.16%
accounts
By operating segment
Guangdong
640594852.83100.98%1308786001.0799.09%-51.05%
Province
Other regions in
5552040.910.88%27096812.692.05%-79.51%
China
Overseas 477651.62 0.08% 632524.86 0.05% -24.48%
Eliminated internal
transactions and -12239983.94 -1.93% -15724690.17 -1.19% 22.16%
accounts
By marketing model
Principal
641072504.45101.05%1320738401.50100.00%-51.46%
operations
Other 5552040.91 0.88% 15776937.12 1.19% -64.81%
Eliminated internal
transactions and -12239983.94 -1.93% -15724690.17 -1.19% 22.16%
accounts
(2) Operating Division Product Category or Operating Segment Contributing over 10% of Operating Revenue
or Operating Profit
□ Applicable □ Not applicable
Unit: RMB
YoY change in YoY change in YoY change in
Operating Gross profit
Cost of sales operating cost of sales gross profit
revenue margin
revenue (%) (%) margin (%)
By operating division
Property sales 309331841.57 144720332.63 53.22% -64.69% -50.48% -13.42%
Engineering
and 241209525.79 236074624.77 2.13% 20.45% 26.64% -4.79%
construction
Rental service 53870265.26 46657985.12 13.39% -34.14% 31.26% -43.15%
Property 36660871.83 22415236.68 38.86% -77.44% -84.64% 28.63%
16ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
management
By product category
Residential
277643154.35126448366.5854.46%-68.27%-56.72%-12.15%
units
Shops and
31688687.2218271966.0542.34%3043.45%23570.78%-50.00%
parking lots
By operating segment
Guangdong
640594852.83449868179.2029.77%-51.05%-43.70%-9.18%
Province
By marketing model
Core business data of the prior year restated according to the changed statistical caliber for the Reporting Period:
□ Applicable □ Not applicable
(3) Whether Revenue from Physical Sales Is Higher than Service Revenue
□ Yes □ No
Operating division Item Unit 2022 2021 Change (%)
Sales volume RMB’0000 16522 69045 -76.07%
Output RMB’0000 37603 204708 -81.63%
Property sales
Inventory RMB’0000 425681 403220 5.57%
Any over 30% YoY movements in the data above and why:
□ Applicable □ Not applicable
Affected by the real estate market the Company saw less-than-expected property sales carryforwards and existing
property sales in 2022 resulting in a decrease in property investment and development.
(4) Execution Progress of Major Signed Sales or Purchase Contracts in the Reporting Period
□ Applicable □ Not applicable
(5) Breakdown of Cost of Sales
By operating division
Unit: RMB
20222021
Operating
Item As % of total As % of total Change (%)
division Cost of sales cost of sales Cost of sales cost of sales
(%)(%)
Property sales 144720332.63 33.11% 292260823.05 43.86% -50.48%
Engineering
and 236074624.77 54.02% 186409100.14 27.97% 26.64%
construction
Property
22415236.685.13%145898235.4921.90%-84.64%
management
Rental service 46657985.12 10.68% 35545938.32 5.33% 31.26%
Other 2747095.64 0.63% 22151678.03 3.32% -87.60%
Eliminated
internal
-15563273.83-3.56%-15917413.55-2.39%2.22%
transactions
and accounts
Total 437052001.01 100.00% 666348361.48 100.00% -34.41%
Note:
Affected by markets and development cycles property sales experienced a year-on-year drop; engineering and
construction projects saw new breakthroughs in expansion resulting in a year-on-year increase in sales; and property
management revenue registered a drop due to the disposal of subsidiary Shenzhen Property Management Co. Ltd.
17ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
(6) Changes in the Scope of Consolidated Financial Statements for the Reporting Period
□ Yes □ No
See “VI Changes in the Scope of Consolidated Financial Statements” in “Part X Financial Statements”.
(7) Major Changes to the Business Scope or Product or Service Range in the Reporting Period
□ Applicable □ Not applicable
(8) Major Customers and Suppliers
Major customers:
Total sales to top five customers (RMB) 87448833.82
Total sales to top five customers as % of total sales of the
13.78%
Reporting Period (%)
Total sales to related parties among top five customers as % of
0.00%
total sales of the Reporting Period (%)
Information about top five customers:
Sales revenue contributed for As % of total sales revenue
No. Customer
the Reporting Period (RMB) (%)
1 Legal person A 26856591.42 4.23%
2 Legal person B 23269448.58 3.67%
3 Legal person C 15851434.16 2.50%
4 Legal person D 11879250.66 1.87%
5 Legal person E 9592109.00 1.51%
Total -- 87448833.82 13.78%
Other information about major customers:
□ Applicable □ Not applicable
Major suppliers:
Total purchases from top five suppliers (RMB) 278248909.89
Total purchases from top five suppliers as % of total purchases
53.63%
of the Reporting Period (%)
Total purchases from related parties among top five suppliers
0.00%
as % of total purchases of the Reporting Period (%)
Information about top five suppliers:
Purchase in the Reporting
No. Supplier As % of total purchases (%)
Period (RMB)
1 Legal person A 175935982.19 33.91%
2 Legal person B 72443947.18 13.96%
3 Legal person C 15035235.49 2.90%
4 Legal person D 7503316.74 1.45%
5 Legal person E 7330428.29 1.41%
Total -- 278248909.89 53.63%
Other information about major suppliers:
□ Applicable □ Not applicable
3. Expense
Unit: RMB
2022 2021 Change (%) Reason for any significant change
Selling
19217595.11 42737748.22 -55.03% Decreased property sales
expense
Administrativ New project development and staff structure
55758749.0898307831.60-43.28%
e expense adjustments
18ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Decreased bank balances and deposit interest
Finance costs -6507147.03 -18083491.01 64.02%
income
4. R&D Investments
□ Applicable □ Not applicable
5. Cash Flows
Unit: RMB
Item 2022 2021 Change (%)
Subtotal of cash generated
668449932.341805846506.24-62.98%
from operating activities
Subtotal of cash used in
1344225931.103011798614.18-55.37%
operating activities
Net cash generated from/used
-675775998.76-1205952107.9443.96%
in operating activities
Subtotal of cash generated
282766666.00799855541.48-64.65%
from investing activities
Subtotal of cash used in
713537.291751621932.29-99.96%
investing activities
Net cash generated from/used
282053128.71-951766390.81129.63%
in investing activities
Subtotal of cash generated
111428077.62266256968.76-58.15%
from financing activities
Subtotal of cash used in
140126109.45164908415.94-15.03%
financing activities
Net cash generated from/used
-28698031.83101348552.82-128.32%
in financing activities
Net increase in cash and cash
-421928565.67-2056810291.6779.49%
equivalents
Explanation of why any of the data above varies significantly:
□ Applicable □ Not applicable
Cash generated from operating activities decreased year on year primarily driven by the decreased property sales.Cash used in operating activities decreased year on year primarily driven by the land payment made last year.Net cash generated from investing activities increased year on year primarily driven by the large-amount payment
made for equity acquisition and the purchase of currency funds last year.Net cash generated from financing activities decreased year on year primarily driven by the receipt of loan by project
company from minority shareholder last year.Reason for any big difference between the net operating cash flow and the net profit for this Reporting Period
□ Applicable □ Not applicable
There is a big difference between the net operating cash flow and the net profit for the year primarily due to the long
time span between property development sales and revenue recognition.V Analysis of Non-Core Businesses
□ Applicable □ Not applicable
VI Analysis of Assets and Liabilities
1. Significant Changes in Asset Composition
Unit: RMB
31 December 2022 1 January 2022
Change in
As a % of As a % of Reason for any
percentage
Amount total Amount total significant change
(%)
assets assets
19ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Payment of land VAT
Monetary assets 197663949.74 3.47% 564358824.63 9.13% -5.66% of Donghu Mingyuan
in the current period
Accounts
63580422.161.12%61048785.110.99%0.13%
receivable
Development of
Inventories 4257109614.31 74.82% 4034933562.62 65.26% 9.56%
projects
Investment
566873915.079.96%588865777.169.52%0.44%
property
Long-term equity
93927.640.00%272168.280.00%0.00%
investments
Fixed assets 21425475.05 0.38% 23920424.55 0.39% -0.01%
Right-of-use
232496.720.00%365351.970.01%-0.01%
assets
Short-term
51138077.620.90%50440116.240.82%0.08%
borrowings
Carryforwards from
homebuyer payments
Contract liabilities 43533467.29 0.77% 199965490.08 3.23% -2.46%
received in advance to
revenue
Long-term
54261000.000.95%0.95%
borrowings
Lease liabilities 53885.23 0.00% 125920.77 0.00% 0.00%
Held-for-trading Redemption of
408154361.427.17%514024710.918.31%-1.14%
financial assets currency funds
Honoring of
commercial
acceptance notes and
Notes payable 247376403.56 4.00% -4.00% transfer of certain
such notes that had
become mature to
accounts payable
Transfer of certain
such notes that had
Accounts payable 434601559.67 7.64% 141447559.24 2.29% 5.35%
become mature to
accounts payable
Payment of land VAT
Taxes payable 190951185.99 3.36% 600540872.48 9.71% -6.35% of Donghu Mingyuan
in the current period
Other payables 574331340.84 10.09% 581377415.64 9.40% 0.69%
Indicate whether overseas assets account for a high proportion of total assets.□ Applicable □ Not applicable
2. Assets and Liabilities at Fair Value
□ Applicable □ Not applicable
Unit: RMB
Gain/loss
on fair- Cumulative Impairment
Purchased
value fair-value allowance Sold in the
Beginning in the Other Ending
Item changes in changes for the Reporting
amount Reporting changes amount
the charged to Reporting Period
Period
Reporting equity Period
Period
Financial assets
1. Held-
for-trading
financial
514024718970031.51148403840815436
assets
(excluding 0.91 0 0.99 1.42
derivative
financial
20ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
assets)
4.
Investment
36322704.1839235.522490765.13839235.
s in other
equity 33 7 41 57
instruments
Total of the 55034741 8970031.5 1839235.5 13733114 42199359
above 5.24 0 7 6.40 6.99
Financial
0.000.00
liabilities
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 for restriction
Project of public facilities inside and surrounding the urban
Monetary assets 5674439.78 renewal project of Longgang District Shenzhen-construction
funds
Monetary assets 48315.48 Frozen in a lawsuit case
Accounts receivable 51138077.62 Put in pledge for short-term borrowings
Inventories 965000000.00 Lands mortgaged for project development loans
Total 1021860832.88
VII Investments Made
1. Total Investment Amount
□ Applicable □ Not applicable
Total investment amount in the Total investment amount in last year
Change (%)
Reporting Period (RMB) (RMB)
299540000.002047080000.00-85.37%
2. Significant Equity Investments Made in the Reporting Period
□Applicable □ Not applicable
3. Major Non-Equity Investments Ongoing in the Reporting Period
□Applicable □ Not applicable
4. Financial Investments
(1) Securities Investments
□Applicable □ Not applicable
No such cases in the Reporting Period.
(2) Investments in Derivative Financial Instruments
□Applicable □ Not applicable
No such cases in the Reporting Period.
21ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
5. Use of Funds Raised
□Applicable □ Not applicable
No such cases in the Reporting Period.VIII Sale of Major Assets and Equity Interests
1. Sale of Major Assets
□Applicable □ Not applicable
No such cases in the Reporting Period.
2. Sale of Major Equity Interests
□ Applicable □ Not applicable
Amou
nt
Amou
contri
nt
buted
contri
by the O
buted
equity Re w
by the
interes lat ne Execu
sale to
ts to ed rs ted as
net
net - Relation hi sched
Selli incom Index
incom pa ship p uled Di
Equi ng e of to
e of Pricin rty between ful or not scl
Count ty Date pric the disclo
the Effect of the sale g tra counterp ly if not os
erpart inter of e Comp sed
Comp on the Company princi ns arty and tra state ure
y ests sale (RM any as infor
any ple ac the ns reason dat
sold B’0 a matio
from tio Compan fer and e
000) percen n
period n y re action
tage
- or d s
of the
beginn no or taken
Comp
ing to t no
any’s
date t
net
of sale
incom
(RMB
e (%)
’0000
)
This transaction is The Shenzhe Anno
in line with the transa n unce
Company’s ction Internati ment
price onal
development on the
is Trade
100 strategies and is Comp
Shenz deter Center
% of
hen conducive to the mined Property letion
equit
Intern Company’s based Manage of the
y
ationa further on the ment Relate
inter 30
l
ests optimization and
net Co. d-
Trade 11 asset Ltd. Se
of adjustment of its party
Cente Febr 196 valuati (hereina pte
Shen 964.5 industry structure 81.02 Ye Ye Trans
r uary 67.6 on fter Yes m
zhen 2 enrichment of % s s Prope 202 action
Prop 7
assess referred ber
rty 2 capital reserves ed by to as regard
erty 20Mana expansion of new the “ITC ingMan 22
geme profit growth evalua Property age the
nt tion Manage
ment areas and TransfCo. agenc ment”)
Co. continuous er of
Ltd. y on is a
Ltd. improvement of the wholly- 100%
its quality. During base owned of
the Reporting date subsidia Equit
Period the of 30 ry of y
counterparty has June ShenZh Intere
22ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
paid 90% 2021. en sts of
(RMB17700900 Properti Shenz
es &
0) of the equity hen
Resourc
transfer payment es Prope
to the Group in Develop rty
accordance with ment Mana
the equity transfer (Group) geme
agreement. After Ltd. nt“hereinathe equity Co.fter
transfer the Ltd.referred
Company to as (2022derecognized the “SZPR -032)said equity and D” and disclo
confirmed the both sed on
SZPRD
investment www.and the
income of cninfo
Compan
RMB161581100 y are .com.in consolidated majority cn
financial -owned
statements. The subsidia
matter has a ries of
Shenzhe
positive impact on
n
the Company cash Investm
flow and ent
operating results Holding
in 2022. s Co.Ltd.Thus an
associati
on
relations
hip is
formed.IX 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
Relationsh Main
business Registere Total Operating Operating Company name ip with the Net assets Net profit
scope d capital assets revenue profit Company
Guangdong
Developme - - -
Jianbang Group 2800000 1485802
Subsidiary nt of real 1569655 1030693 8184594
(Huiyang) Industrial
estate .00 072.25
Co. Ltd. 5.83 7.48 .48
Shenzhen SPG
Developme - -
Chuanqi Real Estate 3000000 1101813 9941818
Subsidiary nt of real 169495.3 191631.9
Development Co.estate 0.00 520.17 99.24
Ltd. 7 1
Shenzhen SPG
Developme
Longgang 3000000 1302267 5760235 2666212 3757227 1113881
Subsidiary nt of real
Development Co.estate 0.00 00.89 8.61 0.02 .19 6.55
Ltd.Shantou SEZ
Wellam FTY Developme - -
9122612972483790304812410093
Building Subsidiary nt of real 3225621 3225621
Development Co. estate 0.44 2.66 7.44 .12 8.54 8.54
Ltd.Shantou Huafeng Developme - -
8000000832020717624891210217
Real Estate Subsidiary nt of real 3144032 3413873
Development Co. estate 0.00 57.11 9.13 39.63 .12 .32
23ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Ltd.Developme - - -
Great Wall Estate 2051146 1940013 477651.6
Subsidiary nt of real 9008888 431973.1 431973.1
Co. Inc. (U.S.)
estate .00 1.63 2 4.01 0 0
Shenzhen Zhentong Installation
1000000128018220168332423263535875.6345974.3
Engineering Co. Subsidiary and
Ltd. maintenance 0.00 61.20 4.04 38.13 1 7
--
Shenzhen Petrel Hotel 3000000 4697826 3692432 1340143
Subsidiary 3353411 2521866
Hotel Co. Ltd. service 0.00 3.33 1.85 2.09.41.37
Shenzhen Huazhan
Constructio
Construction 8000000 1088498 1032818 3802892 306693.4 292964.2
Subsidiary n
Supervision Co.supervision .00 8.58 5.16 .48 7 5
Ltd.Investment
---
Xin Feng Enterprise and 502335.0 3390715
Subsidiary 2263709 1293488 1293488
Co. Ltd. managemen 0 13.82
t 65.47 6.25 6.25
Subsidiaries obtained or disposed in the Reporting Period:
□ Applicable □ Not applicable
Way of gaining and disposing Influence on overall production and
Name
subsidiaries operation as well as performance
Shenzhen Property Management Co. Refer to Note VIII Sale of Major Assets
Negotiating transfer
Ltd. and Equity Interests
Information about major majority- and minority-owned subsidiaries:
1. In May 2021 through the payment of consideration of RMB450 million the Group acquired 51% equity interest in
Guangdong Jianbang Group (Huiyang) Industrial Co. Ltd. The project company will develop the Linxingyuan Project
with a gross site area of 200000 square meters and a total capacity building area of 0.4 million square meters which
will be developed in four phases and is expected to achieve revenue of RMB6 billion and total profit of approximately
RMB1.8 billion from 2023 to 2025. The Group has control over the project company which will be included in the
scope of consolidation in May 2021. As at the end of 2022 eight residential buildings of Phase I have been capped the
basement of Phase II has been completed the development of Phase III and Phase IV are to be initiated and
construction permit has not been granted for the school. In 2022 new areas sold totaled 2236 square meters income
from sales increased by RMB25.58 million and RMB22.29 million was withdrawn.
2. In October 2021 the Company won the bid for a land plot in Guangming District and established the project
company Shenzhen SPG Chuanqi Real Estate Development Co. Ltd. to be responsible for the development and
construction of the land. In 2022 actual investment totaled RMB74.81 million which was mainly made in primary
supporting piles and groundworks.
3. The subordinate subsidiaries engaged in real estate development also 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 RMB24.69 million in 2022 (the percentage of accumulative sales carried forward was 96%). Jinyedao and
YuejingDongfang developed by Shantou SEZ Wellam FTY Building Development Co. Ltd. left a few amount of
remaining buildings for sale. 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 completed in
December 2019. The Phase II started construction in November 2018 and was completed at the end of June 2021. The
overall sales progress is relatively slow with an accumulated sales rate of about 74% for Phase I and 19% for Phase II.
4. Shenzhen Zhentong Engineering Co. Ltd. was engaged in the business of building installation and maintenance with
the 2022 operating revenues of RMB242 million and of 38.20% to the operating revenues of the Company.
24ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
5. The 2022 net profit of Xin Feng Enterprise Co. Ltd. was of RMB-12.93 million which mainly due to the changes of
exchange rate and it conducts no business.
6. The 2022 net profit of Shenzhen Petrel Hotel Co. Ltd. was of RMB-2.52 million which mainly due to the fact that
the hotel industry is generally facing difficulties in the business operation during the Reporting Period.X Structured Bodies Controlled by the Company
□Applicable □ Not applicable
XI Prospects
(I) Industrial Pattern and Trend
The real estate industry is still the pillar industry of China’s national economy. After a series of strong macro-control
the industry is undergoing a gradual return to the track of sound and healthy development. Since the end of last year
loose policies have been introduced for real estate credits bonds equities and overseas loans under domestic
guarantees so China’s urbanization will still be in a stage of rapid development in the next period of time and there
will be enough space for demands to support the steady development of the real estate industry and the real estate
market is expected to recover step by step.(II) Potential Risks and Countermeasures
1. Macroeconomic risks and countermeasures
The real estate industry has a greater correlation with the macroeconomy and is more influenced by the macroeconomic
cycle. The geopolitical situation is now volatile the risk of the world economy going downward is rising and the
domestic economy is repeatedly impacted by multiple factors that go beyond expectations. Pressures from shrinking
demand supply shock and weakening expectations continue to evolve and the development environment is gaining
complexity severity and uncertainty. The Company will continue to pay attention to the international and domestic
macroeconomic situation and actively adjust its business strategy.
2. Industry regulation risks and countermeasures
On the whole industry regulation has been relaxed and policies are gradually shifting but there are little changes in the
policies of tier-one cities represented by Beijing Shanghai Guangzhou and Shenzhen. Market sentiment and
homebuyer confidence remain low. The Company will continue to deepen its research on industry policies follow the
national strategies innovate its operating model and optimize its development method while continuing to study
industry-university-institute cooperation strenuously exploring new areas and actively cultivating new business models.
3. Business operating risks and countermeasures
The land space in Shenzhen where the Company’s business focus is located is limited while project expansion
requires a large amount of capital so the Company faces challenges in adding land reserves. The Company will pay
close attention to the market and industry policy changes formulate targeted land expansion plans and the Company
will pay close attention to the quality and efficiency improvement of existing assets and maintain a good operating
revenue scale and performance level.(III) Development strategy and operating plan
The year 2023 is the first year for implementing the spirit of the 20th National Congress of the Communist Party of
China a crucial year for connecting the past and the next in the 14th Five-year Plan and a critical year for the
Company to deepen reform and seek development. Based on the high-quality development strategies of the central
25ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
government the provincial government and the municipal government the Company will earnestly implement the
deployment requirements of the State-owned Assets Supervision and Administration Commission of the People’s
Government of Shenzhen Municipal (“Shenzhen SASAC) and Shenzhen Investment Holdings Co. Ltd. (“SIHC”)
further analyze and study the situation based on its own development face up to challenges seize opportunities
strengthen overall planning and promote the high-quality development of the Group to a new level.The Company has made an overall operating plan for 2023. Guided by the Xi Jinping Thought on Socialism with
Chinese Characteristics for a New Era the Company will conscientiously implement the spirit of the 20th National
Congress of the Communist Party of China the Central Economic Working Conference and important addresses of
General Secretary Xi Jinping make overall plans highlight implementation carry out reform and innovation forge
ahead and exert all efforts to promote the steady and long-term high-quality development of Shenzhen Properties
Group (“SPG”) in accordance with the decisions and arrangements of Shenzhen Municipal Party Committee and
Government Shenzhen SASAC and SIHC adhering to the idea of seeking progress while maintaining stability andrealizing sustainable development centering on the overall objective of “consolidating primary business exploringdevelopment paths preventing and mitigating risks and making plans of high-quality and sustainable development”
and following the leadership of Party building.In 2023 the Company will focus on the following five aspects:
1. Deepening implementation and going all out to achieve performance targets
First it will endeavor to the sales of Guangmingli and Tianyuewan projects and existing real estate projects to ensure
quick withdrawal of funds and smooth achievement of performance targets. Second it will intensify leasing business to
achieve the annual leasing target. Third it will advance land sales in the United States to promote the realization of
inefficient assets overseas. Fourth it will exert more efforts in recovering arrears to boost revenue and profit realization.Fifth it will strengthen the operation management of its affiliates to ensure the completion of all business targets.
2. Making a sound overall plan and implementing key tasks on all fronts
First it will complete the re-election of members of the Board of Directors and the Party Committee and improve the
structure of its corporate governance. Second it will highlight project construction and ensure smooth implementation
of project development plans. Third it will promptly define the right of the land for Xinfeng Building in Shantou and
go through the construction application procedure as soon as possible. Fourth it will promote the cleaning-up of
“zombie enterprises” and properly address problems carried over from the past. Fifth it will advance the construction
of the “Buildings for Shenzhen-Hong Kong Medical and Healthcare Specialty Industry” and take the initiative to create
the “Massive Health” ecological economic circle centering on SPG Plaza.
3. Taking multiple measures at the same time and making every effort to ensure business operation
First it will well manage funds and financing to provide a solid guarantee for the Company’s capital turnover. Second
it will optimize talent and organization structures to improve work efficiency from all aspects. Third it will intensify
performance appraisal and promote the establishment and improvement of a medium- and long-term incentive
mechanism. Fourth it will effectively respond to litigations and executions to mitigate potential risks. Fifth it will
emphasize security and stability maintenance related to safe production stability maintenance and public opinion
control so as to guard the Company’s business operation and management.
4. Enhancing synergy and actively exploring future development paths
The Company will sticking to the development strategies of the central government provincial government and
municipal government earnestly implement the decisions and deployments of superiors intensify industrial research
26ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
centering on the development directions of controlling shareholders enhance strategic and collaborative development
of SIHC and synergetic development with system houses and strive to make breakthroughs in the process of
supporting and serving the development strategy of SIHC and form the Company’s new core competitiveness.
5. Following the leadership of Party building and leading overall high-quality development
Guided by the Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era the Company will
continue to organize the study publicity and implementation of the spirit of the 20th National Congress of the
Communist Party of China and turn the effects of such study publicity and implementation into a powerful driving
force for its reform and development. On top of that the Company will strengthen its Party organization theoretically
and organizationally improve the Party organization’s conduct and effectively integrate Party leadership into
corporate governance to lead to high-quality development of the Company.XII Communications with the Investment Community such as Researches Inquiries and
Interviews during the Reporting Period
□ Applicable □ Not applicable
Place Index to
Way of Type of
Date of visit of Visitor Contents and materials provided main inquiry
visit visitor
visit information
The Inquired of the future development plan
By Individual
4 January 2022 Comp Individual of the Company and didn’t offer written N/A
telephone investor
any materials
The
By Individual Inquired of project sales of the Company
18 January 2022 Comp Individual N/A
telephone investor and didn’t offer written materials
any
The Inquired of the land reserves and projects
By Individual
24 January 2022 Comp Individual progress of the Company and didn’t offer N/A
telephone investor
any written materials
The Inquired of business situations and
By Individual
10 February 2022 Comp Individual strategic planning of the Company and N/A
telephone investor
any didn’t offer written materials
The Inquired of the future development plan
By Individual
15 February 2022 Comp Individual of the Company and didn’t offer written N/A
telephone investor
any materials
The Inquired of business situations and
By Individual
21 February 2022 Comp Individual strategic planning of the Company and N/A
telephone investor
any didn’t offer written materials
The
By Individual Inquired of business situation and didn’t
1 March 2022 Comp Individual N/A
telephone investor offer written materials
any
The Inquired of the land reserves and projects
By Individual
9 March 2022 Comp Individual progress of the Company and didn’t offer N/A
telephone investor
any written materials
The Inquired of the future development plan
By Individual
25 March 2022 Comp Individual of the Company and didn’t offer written N/A
telephone investor
any materials
The
By Individual Inquired of business situation and didn’t
30 March 2022 Comp Individual N/A
telephone investor offer written materials
any
The Inquired of business situations and
By Individual
8 April 2022 Comp Individual strategic planning of the Company and N/A
telephone investor
any didn’t offer written materials
The
By Individual Inquired of project sales of the Company
11 April 2022 Comp Individual N/A
telephone investor and didn’t offer written materials
any
27ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
The Inquired of the future development plan
By Individual
18 April 2022 Comp Individual of the Company and didn’t offer written N/A
telephone investor
any materials
The Inquired of the land reserves and projects
By Individual
21 April 2022 Comp Individual progress of the Company and didn’t offer N/A
telephone investor
any written materials
The Inquired of business situations and
By Individual
10 May 2022 Comp Individual strategic planning of the Company and N/A
telephone investor
any didn’t offer written materials
The
By Individual Inquired of project sales of the Company
12 May 2022 Comp Individual N/A
telephone investor and didn’t offer written materials
any
The Inquired of the future development plan
By Individual
23 May 2022 Comp Individual of the Company and didn’t offer written N/A
telephone investor
any materials
The Inquired of the land reserves and projects
By Individual
2 June 2022 Comp Individual progress of the Company and didn’t offer N/A
telephone investor
any written materials
The Inquired of business situations and
By Individual
14 June 2022 Comp Individual strategic planning of the Company and N/A
telephone investor
any didn’t offer written materials
The Inquired of business situations and
By Individual
16 June 2022 Comp Individual strategic planning of the Company and N/A
telephone investor
any didn’t offer written materials
The
By Individual Inquired of project sales of the Company
20 June 2022 Comp Individual N/A
telephone investor and didn’t offer written materials
any
The Inquired of business situations and
By Individual
22 June 2022 Comp Individual strategic planning of the Company and N/A
telephone investor
any didn’t offer written materials
The
By Individual Inquired of project sales of the Company
29 June 2022 Comp Individual N/A
telephone investor and didn’t offer written materials
any
The Inquired of business situations and
By Individual
4 July 2022 Comp Individual strategic planning of the Company and N/A
telephone investor
any didn’t offer written materials
The Inquired of the future development plan
By Individual
20 July 2022 Comp Individual of the Company and didn’t offer written N/A
telephone investor
any materials
The Inquired of the project sales and future
By Individual
25 July 2022 Comp Individual development plan of the Company and N/A
telephone investor
any didn’t offer written materials
The
By Individual Inquired of project sales of the Company
10 August 2022 Comp Individual N/A
telephone investor and didn’t offer written materials
any
The Inquired of the future development plan
By Individual
24 August 2022 Comp Individual of the Company and didn’t offer written N/A
telephone investor
any materials
The Inquired of the future development plan
By Individual
5 September 2022 Comp Individual of the Company and didn’t offer written N/A
telephone investor
any materials
The Inquired of the land reserves and projects
By Individual
8 September 2022 Comp Individual progress of the Company and didn’t offer N/A
telephone investor
any written materials
The Inquired of business situations and
By Individual
14 September 2022 Comp Individual strategic planning of the Company and N/A
telephone investor
any didn’t offer written materials
The Inquired of the future development plan
By Individual
11 October 2022 Comp Individual of the Company and didn’t offer written N/A
telephone investor
any materials
28ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
The
By Individual Inquired of project sales of the Company
17 October 2022 Comp Individual N/A
telephone investor and didn’t offer written materials
any
The Inquired of the future development plan
By Individual
20 October 2022 Comp Individual of the Company and didn’t offer written N/A
telephone investor
any materials
The Inquired of the land reserves and projects
By Individual
1 November 2022 Comp Individual progress of the Company and didn’t offer N/A
telephone investor
any written materials
The
By Individual Inquired of project sales of the Company
2 November 2022 Comp Individual N/A
telephone investor and didn’t offer written materials
any
The Inquired of the future development plan
By Individual
15 November 2022 Comp Individual of the Company and didn’t offer written N/A
telephone investor
any materials
The Inquired of the land reserves and projects
By Individual
15 December 2022 Comp Individual progress of the Company and didn’t offer N/A
telephone investor
any written materials
The
By Individual Inquired of project sales of the Company
19 December 2022 Comp Individual N/A
telephone investor and didn’t offer written materials
any
The Inquired of the future development plan
Field Individual
28 December 2022 Comp Individual of the Company and didn’t offer written N/A
research investor
any materials
29ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Part IV Corporate Governance
I Basic Situation of Corporate Governance
In accordance with the requirements of the Company Law the Securities Law the Code on the Governance of Listed
Companies and other laws and regulations the Company has been improving its governance structure continuously
adhering to standardized operation and an operational mechanism featuring decision-making by the board of directors
execution by the management team and supervision by the board of supervisors has been formed.During the reporting period the Company's governance institutions at all levels have carried out their responsibilities
and authorities clearly and definitely and have performed their own functions. At the same time they have checked and
balanced each other in decision-making implementation and supervision effectively and have operated in a
coordinated manner.
(1) Operation of the general meeting of shareholders
The preparation holding of the annual and extraordinary general meetings of shareholders of the Company as well as
disclosure of the resolutions made at the meetings have been carried out in strict accordance with the Company Law
the Rules of the General Meeting of Shareholders of Listed Companies of China Securities Regulatory Commission
(CSRC) the Articles of Association and the Rules of Procedure of the General Meeting of Shareholders of the
Company. The notification time of the meeting the procedure of authorization the procedure of convening the
convener the qualification of the personnel attending the meeting and the voting procedure of the meeting have all
been in line with relevant provisions. An on-site interaction for shareholders has been set at the shareholders' meeting
to ensure that the shareholders especially the small and medium-sized shareholders can exercise their legitimate rights.
(2) Operation of the board of directors
The preparation and holding of the board meeting of the Company and the disclosure of the resolution made at the
meeting have been carried out in strict accordance with the Company Law the Self-regulation Guidelines for Listed
Companies of Shenzhen Stock Exchange No. 1-Standardized Operation of Listed Companies on the Main Board the
Articles of Association and the Rules of Procedure of the Board Meeting of the Company. The number and manning of
the board of directors have met the requirements of laws and regulations. The directors have worked diligently and
responsibly and the board of directors has worked hard in making decisions and setting the direction for the Company
and has exercised its power in accordance with the requirements for corporate governance.
(3) Operation of the supervisory committee
The number and manning of the board of supervisors have met the requirements of laws and regulations. All members
of the board of supervisors of the Company have performed their duties diligently and conscientiously. They have
supervised and inspected the important matters of the Company in strict accordance with the Company Law the Self-
regulation Guidelines for Listed Companies of Shenzhen Stock Exchange No. 1-Standardized Operation of Listed
Companies on the Main Board the Articles of Association and the Rules of Procedure of the Board of Supervisors of
the Company exercised the power of supervision effectively gave a full play to the supervisory function have played
a substantial role in the operation and management of the Company and have protected the legitimate rights and
interests of the Company and the shareholders.
(4) Operation at manager level
The manager level of the Company has performed its duties in strict accordance with the Company Law the Self-
regulation Guidelines for Listed Companies of Shenzhen Stock Exchange No. 1-Standardized Operation of Listed
Companies on the Main Board the Articles of Association and the Detailed Working Rules for the General Manager of
the Company. The manager level is responsible for the production operation and management of the Company all-
roundly. They have performed their duties diligently and conscientiously and have carried out the decisions of the
board of directors effectively. The members at the manager level have had a clear division of labor among them they
have worked diligently and conscientiously and there has not existed any situation of "control under insiders ".Indicate by tick market whether there is any material incompliance with laws administrative regulations and
regulations governing the governance of listed companies issued by the CSRC.□Yes □ No
No such cases in the Reporting Period.
30ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
II The Company’s Independence from Its Controlling Shareholder and Actual Controller in
Business Personnel Asset Organization and Financial Affairs
(I) In respect of assets the Company possessed independent and integrated assets and the property of the Company is
transparent.(II) In respect of personnel the Company was absolutely independent in management of labor personnel and salaries
from the controlling shareholders. All the senior executives of the Company took no office title concurrently and drew
no remunerations from the Shareholder Company.(III) In respect of finance the Company has independent financial department independently accounted and paid taxes
according to the law. The Company established a complete accounting system financial accounting system and
financial administrative systems. The Company opened independent bank accounts.(IV) In respect of organization the Board of Directors and the Supervisory Board operated independently. There
existed no superior-inferior relationship between the controlling shareholder and its function department and the
Company.(V) In respect of business the Company possessed independent production supply and sales system.III Horizontal Competition
□ Applicable □ Not applicable
Relationship Comp
Company Progress and
Type with the any Course Countermeasures
name follow-up plan
Company nature
The Company and
ShenZhen For the Company’s existing Refer to the
Properties & business that has horizontal Announcement on
Resources competition with ShenZhen Receiving the
Development Properties & Resources Avoiding Horizontal
(Group) Ltd. Development (Group) Ltd. Competition
(hereinafter Shenzhen Investment Holdings Commitment Letter
referred to as Co. Ltd. will within the scope from the
“SZPRD”) are permitted by laws and Controlling
majority-owned regulations timely launch one Shareholder (No.:
subsidiaries of or several of the following 2021-032) disclosed
Shenzhen solutions that is practically by the Company on
Shenzhen Investment feasible and complete the 11 September 2021
Horizontal
Controlling Investmen Holdings Co. implementation of the relevant and the
competitio Other
shareholder t Holdings Ltd. The solution(s) before 9 November Announcement on
n
Co. Ltd. Company and 2024 to solve the existing Resolutions of the
SZPRD are horizontal competition problem: 1st Extraordinary
operating real (1) Solve the horizontal General Meeting of
estate competition between the two 2021 (No.: 2021-34)
development and through asset sales or asset disclosed by
commercial replacement; (2) Solve the ShenZhen
property sales horizontal competition between Properties &
business which the two through equity transfer; Resources
belong to the (3) Take other measures that Development
same industry. can effectively solve the (Group) Ltd. on 27
There is problem of horizontal September 2021 for
horizontal competition. details.competition.IV Annual and Extraordinary General Meeting Convened during the Reporting Period
1. General Meetings Convened during the Reporting Period
Investor
Convened Disclosure
Meeting Type participati Index to disclosed information
date date
on ratio
The 2021 Resolutions of 2021 Annual General Meeting
Annual
Annual disclosed on China Securities Securities Times
General 63.56% 17 May 2022 18 May 2022
General
Meeting Ta Kung Pao and www.cninfo.com.cn (No.:
Meeting 2022-018)
31ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
The 1st Resolutions of the 1st Extraordinary General
Extraordinar Extraordinar
16 November 17 November Meeting of 2022 disclosed on China Securities
y General y General 56.27%
Meeting of Meeting 2022 2022 Securities Times Ta Kung Pao and
2022 www.cninfo.com.cn (No.: 2022-041)
2. Extraordinary General Meeting Convened at Request of Preference Shareholders with Resumed Voting
Rights
□Applicable □ Not applicable
V Directors Supervisors and Senior Management
1. Basic Information
Other
Beginni Increase Decreas incre
Ending
Incum Ge ng in the e in the ase/d Reaso
Offic A Start of End of shareh
Name bent/F nd sharehol Reportin Reportin ecrea n for
e title ge tenure tenure olding
ormer er ding g Period g Period se change
(share)
(share) (share) (share) (shar
e)
Tang 31
Direc Incum Ma
Xiaopin 53 December 0 0 0 0 0
tor
g bent le 2020
Tang 14
Incum Ma
Xiaopin GM 53 December 0 0 0 0 0
g bent le 2020
Person
al
Deng
Direc Incum Ma 17 April financi
Kangch 57 10000 0 2500 0 7500
tor 2012
eng bent le al
arrang
ement
Wang Direc Incum Ma 11 October
5000000
Jianfei tor bent le 2021
22
Wang Incum Ma
CFO 50 September 0 0 0 0 0
Jianfei bent le 2021
Fe
Direc Incum 8 September
Wen Li ma 54 0 0 0 0 0
tor bent 2006
le
31
Sun Direc Incum Ma
42 December 0 0 0 0 0
Minghui tor bent le 2020
Indep
ende
Kang Incum Ma 15 May
nt 59 0 0 0 0 0
Xiaoyue
direct bent le
2018
or
Indep
ende
He Incum Ma 30 June
nt 61 0 0 0 0 0
Zuowen 2020
direct bent le
or
Indep
ende
Mi Incum Ma 30 June
nt 48 0 0 0 0 0
Xuming
direct bent le
2020
or
Chair
Wang man Incum Ma 17 May
5700000
Jiangtao of the bent le 2022
Supe
32ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
rviso
ry
Com
mitte
e
Supe
Incum Ma 15 May
Ren Wei rviso 43 2000 0 0 0 2000
r bent le
2018
Supe Fe
Incum 17 April
Li Yufei rviso ma 45 0 0 0 0 0
2012
r bent le
Feng Supe
Incum Ma 2 March
Hongwe rviso 52 0 0 0 0 0
i r bent le
2017
Supe Fe
Incum 27 April
Lin Jun rviso ma 54 0 0 0 0 0
bent 2016 r le
Zhang
Vice Incum Ma 15 July
Hongwe 57 0 0 0 0 0
GM bent le 2020
i
Huang Vice Incum Ma 29 July
5100000
Weijun GM bent le 2022
Wu Vice Incum Ma 29 July
5100000
Zhiyong GM bent le 2022
Secre
tary 31
Incum Ma
Luo Yi of the 49 December 0 0 0 0 0
Boar bent le 2020
d
Chair 1
Liu man
Forme Ma 15 January Nove
Zhengy of the 53 0 0 0 0 0
u Boar r le 2020 mber
d 2022
Chair
man
of the
Supe Fe 31 17
Forme
Li Lian rviso ma 56 December May 0 0 0 0 0
ry r le 2020 2022
Com
mitte
e
Fe 28
Wei Vice 7 June
Left ma 57 September 0 0 0 0 0
Hanping GM 2022
le 2012
Total -- -- -- -- -- -- 12000 0 2500 0 9500 --
Indicate by tick mark whether any directors or supervisors left or any senior management were disengaged during the Reporting Period
□Yes □ No
1. Chairman Mr. Liu Zhengyu of the Company no longer serves as the Chairman of the Board of Directors or a director
of the Company due to job changes. For details please refer to the Announcement on Leave of Chairman and Election
of A Director to Act as the Chairman (Announcement No. 2022-040) disclosed by the Company on 2 November 2022
on cninfo.com.cn.
2. Chairman Ms. Li Lian of the Board of Supervisors of the Company has gone through the procedure to get retired
and no longer serves as the Chairman of the Board of Supervisors or a supervisor of the Company. For details please
refer to the Announcement on Change of Supervisor and Chairman of the Board of Supervisors (Announcement No.
2022-020) disclosed by the Company on 18 May 2022 on cninfo.com.cn.
33ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
3. Deputy General Manager Ms. Wei Hanping of the Company has gone through the procedure to get retired and no
longer serves as the Deputy General Manager of the Company. For details please refer to the Announcement on
Retirement and Leave of Deputy General Manager (Announcement No. 2022-021) disclosed by the Company on 8
June 2022 on cninfo.com.cn.Change of 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 Left 1 November 2022 Job change
Chairman of the
Li Lian Supervisory Left 17 May 2022 Retirement
Committee
Wei Hanping Vice GM Left 7 June 2022 Retirement
Chairman of the
Wang Jiangtao Supervisory Elected 18 May 2022
Committee
Huang Weijun Vice GM Engaged 29 July 2022
Wu Zhiyong Vice GM Engaged 29 July 2022
2. Biographical Information
Professional backgrounds major work experience and current duties in the Company of the incumbent directors supervisors and senior
management:
1. Tang Xiaoping: he ever act as CFO and finance minister of Shenzhen HRD Assets Management Company minister
of Financial Operations Management Department of Shenzhen Foreign Labor Service Co. Ltd. and executive director
of Shenzhen Foreign Affairs Service Center Manager of Financing Plan Department deputy GM secretary of the
Board of the Company and deputy secretary of the CPC of the Company. He is currently the director GM and
secretary of the CPC of the Company.
2. Deng Kangcheng: he was once deputy director director of the Office of Shenzhen Investment Holdings Co. Ltd.
and supervisor of the Company. And now he acts as the director Vice Secretary of CPC and Chairman of the Trade
Union Federation of the Company.
3. Wang Jianfei: he was once the minister of the Financial Management Department of Shenzhen Construction
Development (Group) Company vice GM of Hubei SIHC Investment Development Co. Ltd. And now he acts as the
director and CFO of the Company.
4. Wen Li: she once worked as the vice chief of the Investment and Development Department vice director of
Management Center for Construction Project and Minister of Enterprise Department I of Shenzhen Investment
Holdings Co. Ltd. Now she serves as the director GM and vice secretary of CPC in Shenzhen Bay Technology
Development Co. Ltd. and the director of the Company.
5. Sun Minghui: Former the senior director of the Finance Department and the Office of the Board of Directors of
Shenzhen Investment Holdings Co. Ltd. and the deputy director of the Finance Department (Settlement Center);
currently he is the director of the Finance Department (Settlement Center) of Shenzhen Investment Holdings Co. Ltd.and a director of the Company.
6. Kang Xiaoyue: he was once the staff member of Department of Justice of Jiangxi Province a reporter editor and
head of Special Issue Department of Shenzhen Legal Newspaper. Chief Lawyer senior partner of Guangdong New
Century Law Firm (later renamed Guangdong Wancheng Law Firm). Now he serves as a senior partner of Beijing
Weiheng (Shenzhen) Law Firm and the independent director of the Company.
7. He Zuowen: formerly associate professor of accounting deputy director of teaching and research section and
member of the Disciplinary Committee of Changsha University of Science & Technology partner and deputy director
of Shenzhen Huapeng Certified Public Accountants director and vice GM of Beijing Zhongtian Huazheng Certified
Public Accountants Co. Ltd. (Dahua Certified Public Accountants) as well as head of Shenzhen Branch of it partner of
BDO Certified Public Accountants; advisory expert of Internal Control Standard Committee of the Ministry of Finance
(the 1st 2nd and 4th) director of Shenzhen Institute of Certified Public Accountants director of the Investigation
34ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Committee member of the Shenzhen Municipal Social Organization Disciplinary Inspection Committee member of
CPC Vice Secretary of CPC & Secretary of the Disciplinary Committee of Shenzhen CPA Industry Committee etc.currently partner of Dahua Certified Public Accountants (Special General Partnership) Secretary of CPC General
Branch of Shenzhen Branch Chairman of Shenzhen Tianye Tax Agent Co. Ltd. and also served as the independent
director of Shenzhen Textile (Group) Co. Ltd. Shenzhen Bioeasy Biotechnology Co. Ltd. Shenzhen Tongyi Industry
Co. Ltd. and the Company. The main social positions are: judge of the Shenzhen Municipal Senior Accountant Review
Committee external master tutor of Shenzhen University member of Shenzhen CPA Industry Committee director of
Shenzhen Certified Tax Agents Association and Member of the Capital Market Advisory Expert Committee of the
Xinjiang Regulatory Bureau of the China Securities Regulatory Commission expert of the experts database of State-
owned Assets Supervision and Administration Commission of the People’s Government of Shenzhen Municipality
Development and Reform Commission of Shenzhen Municipality Science and Technology Innovation Commission of
Shenzhen Municipality Shenzhen Bureau of Radio Television Culture Tourism and Sports Shenzhen United
Property and Equity Exchange etc.
8. Mi Xuming: Former lecturer and associate professor at Shenzhen University post-doctor of post-doctoral mobile
station for applied economics of School of Economics of Xiamen University visiting scholar at the University of
Exeter; currently professor and master tutor of Shenzhen University and at the same time as the independent directors
of Shenzhen Farben Information Technology Co. Ltd. and the Company.
9. Wang Jiangtao: Former Deputy General Manager and Secretary of the Party Branch of Shenzhen Foreign Economic
and Trade Investment Company Director Secretary of the Disciplinary Committee Secretary of CPC and Chairman of
the Supervisory Committee of Shenzhen Architecture Design General Research Institute; currently Chairman of the
Supervisory Committee Secretary of the Disciplinary Committee and member of CPC of the Company.
10. Ren Wei: he once was the CFO of Xian Zhenye Real Estate Development Co. Ltd. minister of Budget &
Financing Department and director of Fund Centre of Shenfubao Group Co. Ltd. Now he serves as the vice minister of
Audit Department of Shenzhen Investment Holdings Co. Ltd. and the supervisor of the Company.
11. Li Yufei: she ever worked as the Assistant to the Manager of the Investment Department and Assistant to the
Manager & Vice Manager of Assets Management Centre as well as the Senior Management Staff of Enterprise
Department I and Enterprise Department II (Journal Center) in Shenzhen Investment Holdings Co. Ltd. Now she
serves as the deputy director of Discipline Inspection Office in Shenzhen Investment Holdings Co. Ltd. and the
supervisor of the Company.
12. Feng Hongwei: he once was the Vice Chief of the Board Secretariat the Securities Representative and Minister of
Audit Department. Now he acts as the supervisor member of the Disciplinary Committee and Manager of Asset
Management Center of the Company.
13. Lin Jun: She once was the Vice Chief and Chief of the Party-Mass Work Department. And she has been acting as a
supervisor of the Company the Vice Discipline Inspection Secretary and Director of Discipline Inspection and
Supervision Office (Office of the Board of Supervisors).
14. Zhang Hongwei: once served as GM of Shenzhen Urban Construction Investment Development Co. Ltd. Hefei
Ruifa Urban Construction Investment Development Co. Ltd. manager of the Company's Development Department
Sales Department Project II Department Project Management Department; currently deputy GM of the Company
member of CPC Chairman of Jianbang Group and GM of Longgang Development Company.
15. Huang Weijun: Once served as a member of the Party Committee Secretary of the Committee for Discipline
Inspection and Deputy GM of Shenzhen Guangming Group Co. Ltd. a member of the Party Committee Secretary of
the Committee for Discipline Inspection and Deputy GM of Shenzhen OCT Vision Inc. (concurrently as an executive
35ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
director of Shenzhen OCT International Media Performing Co. Ltd.) and now serving as the Deputy GM of the
Company.
16. Wu Zhiyong: Once served as the Chairman and GM of Shenzhen Petrel Hotel Co. Ltd. and Deputy Manager of
Property Management Department and Asset Operation Center of the Company and now serving as the Deputy GM of
the Company.
17. Luo Yi: He was once the Vice GM Deputy Director of Board Secretariat and Securities Representative in the
Shantou branch of the Company. And he now serves as the Board Secretary and Director of the Board Secretariat in the
Company.Offices held concurrently in shareholding entities:
□ Applicable □ Not applicable
Remuneration or
Shareholding Office held in the End of
Name Start of tenure allowance from the
entity shareholding entity tenure
shareholding entity
Shenzhen Chief of Financial
Sun Minghui Investment Department (Settlement 11 November 2020 Yes
Holdings Co. Ltd Center)
Shenzhen
Vice minister of Audit
Ren Wei Investment 18 September 2017 Yes
Department
Holdings Co. Ltd
Shenzhen Deputy Director of
Li Yufei Investment Discipline Inspection 9 July 2015 Yes
Holdings Co. Ltd Office
Offices held concurrently in other entities:
□ Applicable □ Not applicable
Remuneration or
Office held in End of
Name Other entity Start of tenure allowance from the
the entity tenure
entity
Sun China Nanshan Development (Group)
Supervisor 17 October 2017 No
Minghui Co. Ltd.Shenzhen Highway Passenger
Sun
Transportation Service Centre Co. Supervisor 16 June 2017 No
Minghui
Ltd.Sun ULTRARICH
Director 11 November 2020 No
Minghui INTERNATIONAL LIMITED
Sun Shenzhen Chiwan Industry
Supervisor 30 June 2021 No
Minghui Development Co. Ltd.Sun Hubei SIHC Investment Development
Director 11 November 2020 No
Minghui Co. Ltd.Sun
Shenzhen Textile (Holdings) Co. Ltd. Director 10 February 2021 No
Minghui
Shenzhen Shenzhen-Hong Kong
Sun Science and Technology Innovation
Director 18 October 2021 No
Minghui Cooperation Zone Development Co.Ltd.Shenzhen Sungang China Resources
Ren Wei Supervisor 17 October 2017 No
Land Development Co. Ltd.Li Yufei Shenzhen Dapengwan Huaqiao Tomb Director 19 November 2015 No
Shenzhen Shentou Cultural
Li Yufei Director 2 September 2022 No
Investment Co. Ltd.Kang Beijing Weiheng (Shenzhen) Law
Senior partner 2 December 2019 Yes
Xiaoyue Firm
He Dahua Certified Public Accountants
Partner 1 December 2002 Yes
Zuowen (Special General Partnership)
He Shenzhen Tianye Tax Agency Co. Chairman of
1 December 2008 Yes
Zuowen Ltd. the Board
He Shenzhen JPT Opto-Electronics Co. Independent 20 April
1 June 2017 Yes
Zuowen Ltd. director 2022
He Independent
Shenzhen Textile (Holdings) Co. Ltd. 19 July 2017 Yes
Zuowen director
36ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
He Shenzhen Bioeasy Biotechnology Independent
1 October 2017 Yes
Zuowen Co. Ltd. director
He Independent
Shenzhen Tongyi Industry Co. Ltd. 11 October 2018 Yes
Zuowen director
Mi Professor and
Shenzhen University 1 December 2009 Yes
Xuming master tutor
Mi Independent 16 May
ChinaLin Securities Co. Ltd. 10 April 2017 Yes
Xuming director 2022
Mi Shenzhen Farben Information Independent
29 January 2021 Yes
Xuming Technology Co. Ltd. director
Punishments imposed in the recent three years by the securities regulator on the incumbent directors supervisors and senior management
as well as those who left in the Reporting Period:
□Applicable □ Not applicable
3. Remuneration of Directors Supervisors and Senior Management
Decision-making procedure determination basis and actual payments of remuneration for directors supervisors and senior management:
The remuneration of the Company's directors supervisors and senior managers shall be determined and implemented in accordanc e with
the regulations of the Company's remuneration management system.After the review and approval at the 2013 Annual General Meeting of Shareholders held on 23 April 2014 the allowance for independent
directors has been adjusted to RMB7000 (tax included) per person per month since May 2014 and independent directors will not receive
any remuneration other than it from the Company.Remuneration of directors supervisors and senior management for the Reporting Period
Unit: RMB’0000
Total before-tax Any
Incumbent/For remuneration remuneration
Name Office title Gender Age
mer from the from related
Company party
Tang Xiaoping Director and GM Male 53 Incumbent 111.51 No
Deng
Director Male 57 Incumbent 56.4 No
Kangcheng
Wang Jianfei Director and CFO Male 50 Incumbent 74.4 No
Wen Li Director Female 54 Incumbent 0 No
Sun Minghui Director Male 42 Incumbent 0 No
Kang Xiaoyue Independent director Male 59 Incumbent 0 No
He Zuowen Independent director Male 61 Incumbent 0 No
Mi Xuming Independent director Male 48 Incumbent 0 No
Chairman of the
Wang Jiangtao Male 57 Incumbent 40 No
Supervisory Committee
Ren Wei Supervisor Male 43 Incumbent 0 No
Li Yufei Supervisor Female 45 Incumbent 0 No
Feng Hongwei Supervisor Male 52 Incumbent 62.12 No
Lin Jun Supervisor Female 54 Incumbent 62.09 No
Zhang
Vice GM Male 57 Incumbent 97.31 No
Hongwei
Huang Weijun Vice GM Male 51 Incumbent 28.19 No
Wu Zhiyong Vice GM Male 51 Incumbent 73.02 No
Luo Yi Secretary of the Board Male 49 Incumbent 64.12 No
Liu Zhengyu Chairman of the Board Male 53 Former 0 No
Chairman of the
Li Lian Female 56 Former 83.2 No
Supervisory Committee
Wei Hanping Vice GM Female 57 Former 59.9 No
Total -- -- -- -- 812.26 --
37ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
VI Performance of Duty by Directors in the Reporting Period
1. Board Meeting Convened during the Reporting Period
Meeting Date of the meeting Disclosure date Index to disclosed information
Announcement on Resolutions of the 70th Meeting of
The 70th Meeting of
the 7th Board of Directors (No.: 2022-002) disclosed
the 7th Board of 28 February 2022 1 March 2022
on China Securities Journal Securities Times Ta
Directors
Kung Pao and www.cninfo.com.cn.Announcement on Resolutions of the 71st Meeting of
The 71st Meeting of
the 7th Board of Directors (No.: 2022-003) disclosed
the 7th Board of 17 March 2022 18 March 2022
on China Securities Journal Securities Times Ta
Directors
Kung Pao and www.cninfo.com.cn.Announcement on Resolutions of the 72nd Meeting of
The 72nd Meeting of
the 7th Board of Directors (No.: 2022-014) disclosed
the 7th Board of 29 April 2022 30 April 2022
on China Securities Journal Securities Times Ta
Directors
Kung Pao and www.cninfo.com.cn.Announcement on Resolutions of the 73rd Meeting of
The 73rd Meeting of
the 7th Board of Directors (No.: 2022-024) disclosed
the 7th Board of 29 July 2022 30 July 2022
on China Securities Journal Securities Times Ta
Directors
Kung Pao and www.cninfo.com.cn.Announcement on Resolutions of the 74th Meeting of
The 74th Meeting of
the 7th Board of Directors (No.: 2022-027) disclosed
the 7th Board of 25 August 2022 26 August 2022
on China Securities Journal Securities Times Ta
Directors
Kung Pao and www.cninfo.com.cn.Announcement on Resolutions of the 75th Meeting of
The 75th Meeting of
the 7th Board of Directors (No.: 2022-034) disclosed
the 7th Board of 28 October 2022 29 October 2022
on China Securities Journal Securities Times Ta
Directors
Kung Pao and www.cninfo.com.cn.Announcement on Resolutions of the 76th Meeting of
The 76th Meeting of
the 7th Board of Directors (No.: 2022-043) disclosed
the 7th Board of 7 December 2022 8 December 2022
on China Securities Journal Securities Times Ta
Directors
Kung Pao and www.cninfo.com.cn.
2. Attendance of Directors at Board Meetings and General Meetings
Attendance of directors at board meetings and general meetings
The director
Total number Board
Board Board failed to
of board Board meetings
meetings meetings the attend two General
meetings the meetings attended by
Director attended director consecutive meetings
director was attended on way of
through a failed to board attended
eligible to site telecommuni
proxy attend meetings
attend cation
(yes/no)
Tang
7 0 7 0 0 No 2
Xiaoping
Deng
7 0 7 0 0 No 2
Kangcheng
Wang Jianfei 7 0 7 0 0 No 2
Wen Li 7 0 7 0 0 No 2
Sun Minghui 7 0 7 0 0 No 2
Kang
7 0 7 0 0 No 2
Xiaoyue
He Zuowen 7 0 7 0 0 No 2
Mi Xuming 7 0 7 0 0 No 2
Liu Zhengyu 6 0 6 0 0 No 0
Why any independent director failed to attend two consecutive board meetings:
Not applicable
38ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
3. Objections Raised by Directors on Matters of the Company
Indicate by tick mark whether any directors raised any objections on any matter of the Company.□Yes □ No
No such cases in the Reporting Period.
4. Other Information about the Performance of Duty by Directors
Indicate by tick mark whether any suggestions from directors were adopted by the Company.□Yes □ No
Suggestions from directors adopted or not adopted by the Company:
During the Reporting Period all directors of the Company performed their duties diligently and conscientiously. They
thoroughly mastered the Company’s production and operation internal control and standardized operation and put
forward relevant opinions on the Company’s major governance and operation decisions based on their professional
advantages. These opinions were fully communicated and discussed among the directors before forming consensus
which effectively promoted scientific and objective decision-making by the Board of Directors and helpfully
safeguarded the legitimate rights and interests of the Company and all shareholders.VII Performance of Duty by Specialized Committees under the Board in the Reporting Period
Other
Number informat Details
of ion about
Commit meeting Conven Important opinions and suggestions about issues
Members Content
tee s ed date raised the with
convene perform objections
d ance of (if any)
duty
It is believed that the Company has
chosen and applied appropriate
accounting policies and made
reasonable accounting estimates in
accordance with the provisions of the
new Accounting Standards for
Deliberation
Business Enterprises. The Company
14 on the
has always been cautious about
January Company’s
changes in accounting policies and
2022 2021 financial
accounting estimates. There is no use
statements
or abuse of changes in accounting
Audit
He
Commit policies or accounting estimates to
Zuowen
tee of adjust profits. The financial
Sun
the 4 statements prepared by the Company
Minghui
Board of
Mi are true and reliable with complete
Director
Xuming contents.s Deliberation
It is believed that the Company’s
on the
2021 financial statements prepared by
preliminary
Grant Thornton China (LLP) comply
audit opinions
with all provisions of the Accounting
10 of Grant
Standards for Business Enterprises
March Thornton
and truly and completely represent
2022 China (LLP) the Company’s financial position as
on the
of 31 December 2021 and its
Company’s
operating results and cash flows for
2021 financial
the year 2021 in all material respects.statements
Deliberation It is believed that Grant Thornton
17
on the China (LLP) has completed the audit
39ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
March summary of of the Company’s 2021 financial
2022 the 2021 audit statements well.
service
provided by
Grant
Thornton
China (LLP)
for the
Company
It is believed that Grant Thornton
China (LLP) (hereinafter referred to
as “Grant Thornton”) possesses
independence professional
competence the ability to protect
investors and the experience and
capability of providing audit services
for listed companies. During the audit
of the Company’s 2021 financial
statements and internal control Grant
Thornton was able to earnestly
Deliberation
perform its duties in accordance with
21 on the
the requirements of the auditing
October proposed
standards and the Basic Code for
2022 renewal of the Internal Control of Enterprises. It
audit firm
independently objectively and fairly
evaluated the Company’s financial
position and operating results
demonstrating occupational ethics
and professional competence.Therefore it is proposed to the
Company’s Board of Directors that
Grant Thornton should be renewed as
the auditing agency for the
Company’s 2022 financial statements
and internal control.It is held that the Management
Measures for Business Performance
Deliberation
Appraisal and Remuneration
on the
Management of Senior Management
Proposal on
Members (Trial) formulated by the
Formulating
Company is in line with the income
the
distribution policy for state-owned
Management
enterprises and the relevant
Measures for
22 regulations of Shenzhen SASAC can
Business
Februar effectively enhance the loyalty and
Performance
y 2022 diligence consciousness of the Appraisal and
Remune management team further improve Remuneration
the performance appraisal and
ration Management
incentive and restraint mechanism for
and of Senior
Mi senior management members and
Apprais Management advance the Company’s corporate
Xuming Members
al governance and is conducive to the
Wang (Trial)
Commit 4 Company’s long-lasting and healthy
Jianfei
tee of development.He Deliberation
the It is believed that the remuneration
Zuowen on the annual
Board of decision-making procedures for the
remuneration
Director Company’s directors supervisors and of directors
senior management are compliant the
s supervisors
17 remuneration payment standards for
and senior
March the Company’s directors supervisors
management
2022 and senior management are in line as disclosed in
with the regulations of the
the
remuneration system and that the
Company’s
remuneration disclosed in the 2021
2021 annual
annual report is true and accurate.report
Review of the It is held that:
29 April Implementatio 1. The Implementation Plan for
2022 n Plan for Performance Appraisal of Senior
Performance Management Members in 2021 is in
40ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Appraisal of line with the Company requirements
Senior put forward in the Management
Management Measures for Business Performance
Members in Appraisal and Remuneration
2021 the Management of Senior Management
Implementatio Members the appraisal indicators are
n Plan for scientifically and reasonably set and
Performance the plan is conducive to further
Appraisal of improving the incentive and restraint
Senior mechanism for senior management
Management members.Members in 2. The Implementation Plan for
2022 and the Performance Appraisal of Senior
2022 Management Members in 2022 is in
Statement of line with the Company requirements
Responsibility put forward in the Management
of Senior Measures for Business Performance
Management Appraisal and Remuneration
Members for Management of Senior Management
Business Members the appraisal indicators are
Performance scientifically and reasonably set and
the plan is conducive to further
improving the incentive and restraint
mechanism for senior management
members.
3. The 2022 Statement of
Responsibility of Senior Management
Members for Business Performance is
in line with the Company’s Articles of
Association and the Management
Measures for Business Performance
Appraisal and Remuneration
Management of Senior Management
Members and is conducive to further
improving the incentive and restraint
mechanism for senior management
members and promoting the
Company’s long-lasting and healthy
development.It is held that the decision-making
process of the performance appraisal
of senior management members of
Review of the the Company in 2021 conforms to the
results of relevant laws and regulations of
performance China and the Company’s Articles of
appraisal of Association and Management
7 senior Measures for Business Performance
Decemb management Appraisal and Remuneration
er 2022 members of Management of Senior Management
SPG in 2021 Members and has caused no damage
and the result to the interests of the Company or its
application shareholders. Therefore the
plan Committee recognizes the above and
agrees to submit them to the 76th
Meeting of the 7th Board of Directors
of the Company for deliberation.It is believed that Mr. Huang Weijun
Deliberation and Mr. Wu Zhiyong are not involved
on the in the circumstances stipulated in the
Nominat
ion Kang nomination of Company Law that prohibit them
Commit Xiaoyue Mr. Huang from serving as a director a
tee of Deng 22 July Weijun and supervisor or a senior management
1
the Kangchen 2022 Mr. Wu member have never received
Board of g He Zhiyong as punishment by the China Securities
Director Zuowen
the Regulatory Commission and other
s
Company’s relevant authorities or disciplinary
vice managers action by the stock exchange have
not been placed on file for
41ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
investigation by judicial organs for
suspected crimes or placed on file for
inspection by the China Securities
Regulatory Commission for suspected
violations of laws and regulations are
not a defaulter are not a person held
liable or punished for dishonesty and
have the qualifications required by
relevant laws administrative
regulations departmental rules and
normative documents. It is agreed that
Mr. Huang Weijun and Mr. Wu
Zhiyong may be recommended as the
Company’s vice managers.VIII Performance of Duty by the Supervisory Committee
Indicate by tick mark whether the Supervisory Committee found any risk to the Company during its supervision in the Reporting Period.□Yes □ No
The Supervisory Committee raised no objections in the Reporting Period.IX Employees
1. Number Functions and Educational Backgrounds of Employees
Number of in-service employees of the Company as the parent
112
at the period-end
Number of in-service employees of major subsidiaries at the
164
period-end
Total number of in-service employees at the period-end 276
Total number of paid employees in the Reporting Period 273
Number of retirees to whom the Company as the parent or its
0
major subsidiaries need to pay retirement pensions
Functions
Function Employees
Production 137
Sales 14
Technical 15
Financial 32
Administrative 78
Total 276
Educational backgrounds
Category Number
Doctors 2
Masters 21
Bachelors 103
College graduates 72
Technical secondary school graduates 11
High school graduates and below 67
Total 276
2. Employee Remuneration Policy
The management personnel above vice general manager (including vice GM) of the Company conducted annual salary
system other employees conducted contacting the performance with the benefit salary system.
42ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
3. Employee Training Plans
The Company established annual training plan in line with Measures for the Management of Employee Training The
Company adopts internal training hires experts give lectures to the Company or participate professional training train
the on job employees with job knowledge professional skills rules and regulations the business process etc. which
enrich and renew the professional knowledge enhance the comprehensive quality and business skills of the employees.
4. Labor Outsourcing
□Applicable □ Not applicable
X Profit Distributions (in the Form of Cash and/or Stock)
How the profit distribution policy especially the cash dividend policy was formulated executed or revised in the Reporting Period:
□ Applicable □ Not applicable
As audited by Grant Thornton Certified Public Accountants (Special General Partnership) ShenZhen Special
Economic Zone Real Estate & Properties (Group) Co. Ltd. as the parent recorded retained earnings of
RMB1474557043.86 at the beginning of 2022. This plus the net profit of RMB341088743.27 in 2022 and minus
the 10% statutory surplus reserve of RMB34108874.33 and the payout in 2022 of the 2021 dividend of
RMB89026080.00 equals the distributable profit of RMB1692510832.80.According to the Company’s Articles of Association and taking into account the actual situation and future
development of the Company a final dividend plan for 2022 has been proposed as follows: based on the total share
capital of 1011660000 shares at 31 December 2022 a cash dividend of RMB0.61 (tax inclusive) per 10 shares is to
be distributed to the shareholders with no bonus issue from either profit or capital reserves.A total of RMB61711260.00 of cash dividends will be distributed accounting for 40.15% of the consolidated net
profit of RMB153718805.57 attributable to the Company as the parent for the year. And the retained earnings of
RMB1630799572.80 will be carried forward to the next accounting period.Special statement about the cash dividend policy
In compliance with the Company’s Articles of Association and
Yes
resolution of general meeting
Specific and clear dividend standard and ratio Yes
Complete decision-making procedure and mechanism Yes
Independent directors faithfully performed their duties and
Yes
played their due role
Non-controlling interests are able to fully express their opinion
Yes
and desire and their legal rights and interests are fully protected
In case of adjusting or changing the cash dividend policy the
conditions and procedures involved are in compliance with Not applicable
applicable regulations and transparent
Indicate by tick mark whether the Company fails to put forward a cash dividend proposal for shareholders despite the facts that the
Company has made profits in the Reporting Period and the profits of the Company as the parent distributable to shareholders are positive.□Applicable □ Not applicable
Final Dividend Plan for the Reporting Period
□ Applicable □ Not applicable
Bonus shares for every 10 shares (share) 0
Dividend for every 10 shares (RMB) (tax inclusive) 0.61
Total shares as the basis for the profit distribution proposal 1011660000
(share)
Cash dividends (RMB) (tax inclusive) 61711260.00
43ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Cash dividends in other forms (such as share repurchase)
0.00
(RMB)
Total cash dividends (including those in other forms) (RMB) 61711260.00
Distributable profit (RMB) 1692510832.80
Total cash dividends (including those in other forms) as % of
100%
total profit distribution
Cash dividend policy
It’s not easy to distinguish in the Company’s development stage. While when there is a major capital spending the percentage of
cash dividends to the profit distribution shall be 20% at least when conducting the profit distribution.Details about the proposal for profit distribution and converting capital reserve into share capital
The Profit Distribution Plan of 2022 was reviewed and approved by the 78th Meeting of the 7th Board of Directors held on 17
March 2023 and intended to be submitted to The 2022 Annual General Meeting for review. Based on the total 1011660000
shares of the Company as at 31 December 2022 a cash dividend of RMB0.61 (tax included) will be distributed to the A-share and
B-share holders for every 10 shares they hold without bonus share (tax included) and no share capital increase from capital
reserve would be conducted. The profit distribution plan can be implemented upon review and approval of the Shareholde rs’
General Meeting of the Company.XI Equity Incentive Plans Employee Stock Ownership Plans or Other Incentive Measures for
Employees
□Applicable □ Not applicable
No such cases in the Reporting Period.XII Establishment and Execution of the Internal Control System for the Reporting Period
1. Establishment and Execution of the Internal Control System
The Company has established a relatively complete and continuously effective internal control system and has carried
out internal control evaluation in accordance with the internal control matrix and documents. In accordance with the
requirements of the standard system for enterprise internal control and relevant regulations the Company has
maintained effective internal control over financial reporting in all material respects. No major deficiencies in internal
control not related to financial reporting have been found and no factors affecting the evaluation conclusion of internal
control effectiveness have occurred. At the same time the Company attaches great importance to the regulation and
steering role of the big supervision system. By holding joint supervision meetings and carrying out key supervision and
inspection the Company has promoted the standardization level improvement of relevant management work. No major
violations of regulations and disciplines have been found. In the future the Company will continue to develop internal
control in a standardized manner and strengthen the supervision and inspection of internal control in order to promote
the healthy and sustainable development of the Company.
2. Material Internal Control Weaknesses Identified for the Reporting Period
□Yes □ No
XIII Management and Control over Subsidiaries by the Company for the Reporting Period
Integration Countermeasur Settlement Follow-up
Subsidiary Integration plan Problem
progress es taken progress settlement plan
N/A N/A N/A N/A N/A N/A N/A
Note: 1. No new subsidiary was purchased during the Reporting Period.
44ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
XIV Internal Control Self-Evaluation Report or Independent Auditor’s Report on Internal
Control
1. Internal Control Self-Evaluation Report
Disclosure date of the internal control
18 March 2023
self-evaluation report
Index to the disclosed internal control
2022 Internal Control Self-Evaluation Report on www.cninfo.com.cn
self-evaluation report
Evaluated entities’ combined assets as %
81.50%
of consolidated total assets
Evaluated entities’ combined operating
revenue as % of consolidated operating 95.37%
revenue
Identification standards for internal control weaknesses
Weaknesses in internal control over Weaknesses in internal control not
Type
financial reporting related to financial reporting
The criterion of quality of the
recognition of defects of internal control
in the non-financial statements mainly
were order of severity of defect
involving business nature the direct or
potential negative influence nature and
The Company in line with the actual
the influence scope and other factors. If
situation when the follows events or
the follows events or indicators occur
indications happen which means there
there may be serious or important defects
probably existing serious or important
of internal control in the non-financial
defects in the financial report; (1) the
statements:(1) Lack democratic decision-
directors supervisors and senior
making process if lack significant
executives were fraud. (2) Certified
problem decision-making important
Public Accountant find that there is a
appointment and dismissal of cadres
significant error in the financial report
Nature standard significant project investment decision-
however the internal control did not
making; usage of large capital (three
discover it when conducting internal
important one large); (2) Unscientific
control; (3) The Audit Committee under
decision-making process such as the
the Board and Internal Audit Service's
major decision-making errors has caused
supervision to the internal control is
a serious property loss to the company;
invalid. (4) The accounting personnel
(3) Seriously violating state laws and
were without necessary qualities to
regulations; (4) Loss of key management
complete the preparation of financial
personnel or important talent; (5)
statements.Negative news media appear frequently
and widely spread; (6) The results of the
internal control evaluation especially
large or significant defects have not been
corrected. (7) Important business systems
lack control rules or systemic failure.Serious defects: the defects or defect
group may lead to the financial results
misstatement or potential losses >3% of The criterion of quantity of the
net assets; important defects: 1% of net recognition of defects of internal control
assets
Quantitative standard lead to the financial results misstatement were amount of direct economy losses in
or potential losses ≤ 3% of net assets; line with the criterion of quantity of the
General defects: the defects or defect recognition of defects of internal control
group may lead to the financial results in financial report of the Company.misstatement or potential losses ≤ 1% of
net assets.Number of material weaknesses in
0
internal control over financial reporting
Number of material weaknesses in
internal control not related to financial 0
reporting
Number of serious weaknesses in
0
internal control over financial reporting
Number of serious weaknesses in
internal control not related to financial 0
reporting
45ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
2. Independent Auditor’s Report on Internal Control
□ Applicable □ Not applicable
Opinion paragraph in the independent auditor’s report on internal control
We believe that Shenzhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. maintained effective internal control
of financial statements in all significant aspects on 31 December 2022 in accordance with Basic Standards for Internal Contro l and
relevant regulations.Independent auditor’s report on internal control disclosed or
Disclosed
not
Disclosure date 18 March 2023
Index to such report disclosed Report on Internal Control disclosed on www.cninfo.com.cn.Type of the auditor’s opinion Unmodified unqualified opinion
Material weaknesses in internal control not related to financial
No
reporting
Indicate by tick mark whether any modified opinion is expressed in the independent auditor’s report on the Company’s internal control.□Yes □ No
Indicate by tick mark whether the independent auditor’s report on the Company’s internal control is consistent with the internal control
self-evaluation report issued by the Company’s Board.□Yes □ No
XV Rectifications of Problems Identified by Self-inspection in the Special Action for Listed
Company Governance
1. In accordance with the requirements of relevant laws regulations and regulatory rules and in light of the reality of
the Company the Company completed the revision of ten governance policies including the Rules of Procedure of the
General Meeting of Shareholders the Rules of Procedure of the Board Meeting the Rules of Procedure of the Board of
Supervisors the implementation rules of the special committees under the Board of Directors the Work Policy for
Independent Directors the Registration and Administration Policy for Persons with Insider Information and the
Information Disclosure Affairs Management Policy in 2021.
2. The Company held the 77th Meeting of the 7th Board of Directors and the 51st Meeting of the 7th Supervisory
Committee on 19 January 2023 to deliberate the matters concerning the election at the expiration of the office term of
the 7th Board of Directors and the 7th Supervisory Committee. On 15 March 2023 the Company issued the notice of
convention of the 1st Extraordinary General Meeting in 2023 and decided to hold the meeting to deliberate proposals
concerning the election at the expiration of the office term of the Board of Directors and the Supervisory Committee on
30 March 2023.
46ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Part V Environmental and Social Responsibility
I Major Environmental Issues
Indicate by tick mark whether the Company or any of its subsidiaries is a heavily polluting business identified by the enviro nmental
protection authorities of China.□Yes □ No
Administrative penalties imposed for environmental problems during the Reporting Period
Influence on
Rectification
Name Reason Case Result production and
measures
operation
N/A N/A N/A N/A N/A N/A
Other environmental information disclosed with reference to the heavily polluting business
The Company and its subsidiaries are not imposed any administrative penalties for environmental problems during the
Reporting Period.Measures taken to decrease carbon emission in the Reporting Period and corresponding effects
□Applicable □ Not applicable
Reason for failure of disclosing other environmental information
The Company and its subsidiaries isn’t a heavily polluting business identified by the environmental protection
authorities of China.II Social Responsibility
As a listed company controlled by Shenzhen SASAC the Company always remains true to our original aspiration
takes the initiative to assume social responsibility actively participates in social charity activities and promotes the
harmonious development of society with practical actions within our capacity. In 2022 the Company (including all
subsidiaries) invested a total of RMB358700 in public welfare; all party member of the Company in Shenzhen
completed the online “Double Check-in” at the place of residence and the workplace community; the party member
employees participated in 48 volunteer activities with accumulated 243 participants and 1159.50 hours.III Consolidation and Expansion of Poverty Alleviation Outcomes and Rural Revitalization
During the Reporting Period the Company actively participated in the special action of poverty alleviation through
consumption and helped consolidated the achievement in poverty alleviation with poverty alleviation products worth
RMB714000 purchased in the system; supported the rural revitalization of Longdu through completing the
transformation of Xiabei Village Primary School Longdu Town Chenghai District Shantou and caring the study and
living state of students in this school according to the deployment of the Party Committee of SIHC which fullydemonstrated the responsibility of a state-owned enterprise. The Company held the “Improve People’s Livelihood withLove from SPG” public welfare activity to encourage clothing donation and environment protection receiving nearly
500 clothes books and school supplies. All the clothes donated will be sorted out and disinfected by cooperative
agencies and sent to Southern Xinjiang regions.
47ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Part VI Significant Events
I Fulfillment of Commitments
1. Commitments of the Company’s De Facto Controller Shareholders Related Parties and Acquirers as well as
the Company Itself and Other Entities Fulfilled in the Reporting Period or Ongoing at the Period-End
□ Applicable □ Not applicable
Type of Date of Term of
Commitm Fulfillmen
Promisor commit Details of commitment commitme commitme
ent t
ment nt making nt
To avoid horizontal competition Shenzhen
Investment Holdings Co. Ltd. made such a
commitment: For the Company’s existing
business that has horizontal competition with
ShenZhen Properties & Resources Development
(Group) Ltd. Shenzhen Investment Holdings Co.Ltd. will within the scope permitted by laws and
regulations timely launch one or several of the
Other Avoidin following solutions that is practically feasible
commitme Shenzhen g and complete the implementation of the relevant
10 Before 9
nts made Investmen horizont solution(s) before 9 November 2024 to solve the
September November Ongoing
to t Holdings al existing horizontal competition problem: (1)
20212024
minority Co. Ltd. competit Solve the horizontal competition between the two
interests ion through asset sales or asset replacement; (2)
Solve the horizontal competition between the two
through equity transfer; (3) Take other measures
that can effectively solve the problem of
horizontal competition. Above commitment came
into force upon the review and approval on the
shareholders’ meeting of ShenZhen Properties &
Resources Development (Group) Ltd. (dated 27
September 2021).Fulfilled
Yes
on time
Specific reasons for failing to fulfill commitments
N/A
on time and plans for next step (if any)
2. Where there had been an earnings forecast for an asset or project and the Reporting Period was still within
the forecast period explain why the forecast has been reached for the Reporting Period.□Applicable □ Not applicable
II Occupation of the Company’s Capital by the Controlling Shareholder or Its Related Parties for
Non-Operating Purposes
□Applicable □ Not applicable
No such cases in the Reporting Period.III Irregularities in the Provision of Guarantees
□Applicable □ Not applicable
No such cases in the Reporting Period.
48ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
IV Explanations Given by the Board of Directors Regarding the Latest “Modified Opinion” on the
Financial Statements
□Applicable □ Not applicable
V Explanations Given by the Board of Directors the Supervisory Board and the Independent
Directors (if any) Regarding the Independent Auditor's “Modified Opinion” on the Financial
Statements of the Reporting Period
□Applicable □ Not applicable
VI YoY Changes to Accounting Policies Estimates or Correction of Material Accounting Errors
□ Applicable □ Not applicable
For details see “33. Significant Accounting Policies and Estimates” under “V Significant Accounting Policies and Estimates” in “Part XFinancial Statements”.VII YoY Changes to the Scope of the Consolidated Financial Statements
□ Applicable □ Not applicable
Please refer to “VI Changes to the Scope of the Consolidated Financial Statements” in Part X Financial Statements” for details.VIII Engagement and Disengagement of Independent Auditor
Current independent auditor
Name of the domestic independent auditor Grant Thornton China (LLP)
The Company’s payment to the domestic independent auditor
53
(RMB’0000)
How many consecutive years the domestic independent auditor
4
has provided audit service for the Company
Names of the certified public accountants from the domestic
Zhao Juanjuan Jiang Xiaoming
independent auditor writing signatures on the auditor’s report
How many consecutive years the certified public accountants
from the domestic independent auditor have provided audit 4
service for the Company
Indicate by tick mark whether the independent auditor was changed for the Reporting Period.□Yes □ No
Independent auditor financial advisor or sponsor engaged for the audit of internal controls:
□Applicable □ Not applicable
IX Possibility of Delisting after Disclosure of this Report
□Applicable □ Not applicable
X Insolvency and Reorganization
□Applicable □ Not applicable
No such cases in the Reporting Period.
49ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
XI Major Legal Matters
□ Applicable □ Not applicable
Involve
General d Index to
Execution of Disclosure
informatio amount Provision Progress Decisions and effects disclosed
decisions date
n (RMB’0 information
000)
? Xi’an Business Tourism
Company Limited Shaanxi High
(hereinafter referred to as People’s Court
“Business Company”) had Sold all assets
of Business
to pay for the
compensation RMB36.62 Company by
million and the relevant auction in
interest (from 14 accordance
with laws in
September 1998 to the
payment day) to Xi’an 2004. The
Fresh Peak Company applicant has Interim
within one month after the received
RMB15.20 Report 2022
judgment entering into
Xi’an (full text)
In force. If the Business
million. Now
26 August
Project 2154 No Business (No.: 2022-
execution Company failed to pay in 2022
Lawsuit time it had to pay double Company has 030) on
no executable
debt interests to Xi’an www.cninfo.Fresh Peak Company for properties and com.cn
Xi’an Joint
the overdue period; *
Commission
Xi’an Joint Commission
on Commerce
on Commerce had jointly
has been
and severally obligation of
refusing to
the interests of the
execute the
compensation; .* ruling. It is
Business Company shall
difficult to
bear RMB227500 of the
recover the
acceptance fee and the rest.security fee.As Jianbang Group is
incapable of paying the
commercial bills due in
January 2022 which total
RMB177151400
Huizhou Mingxiang
Economic Information
Consulting Co. Ltd.Dispute
Huizhou Huiyang Hongfa
over the
Industry & Trade Co. Ltd.right to 17999.9
No At law and Huizhou Jinlongsheng Pending
claim 6
Industrial Co. Ltd. brought
payment
a lawsuit on dispute over
on bills
the right to claim payment
on bills to the People’s
Court of Huiyang District.This case is still pending
and SPG is negotiating
with Jianbang and the
plaintiffs for an all-
inclusive solution.XII Punishments and Rectifications
□Applicable □ Not applicable
No such cases in the Reporting Period.
50ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
XIII Credit Quality of the Company as well as Its Controlling Shareholder and Actual Controller
□Applicable □ Not applicable
XIV 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. Amounts Due to and from Related Parties
□Applicable □ Not applicable
No such cases in the Reporting Period.
5. Transactions with Related Finance Companies
□Applicable □ Not applicable
The Company did not make deposits in receive loans or credit from and was not involved in any other finance business with any related
finance company or any other related parties.
6. Transactions with Related Parties by Finance Companies Controlled by the Company
□Applicable □ Not applicable
The finance company controlled by the Company did not make deposits receive loans or credit from and was not involved in any other
finance business with any related parties.
7. Other Major Related-Party Transactions
□ Applicable □ Not applicable
The Company transferred 100% equity interests of Shenzhen Property Management Co. Ltd. to Shenzhen International
Trade Center Property Management Co. Ltd. which was a related-party transaction and was reviewed and approved on
the 69th Meeting of the 7th Board of Directors and the 3rd Extraordinary General Meeting of 2021 of the Company. The
said issue has been completed during the Reporting Period.Index to announcements on major related-party transactions
Announcement Disclosure time Disclosure website
51ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Announcement on Resolutions of the
69th Meeting of the 7th Board of 14 December 2021 www.cninfo.com.cn
Directors (No.: 2021-049)
Announcement on Progress of the
Related-Party Transaction regarding the
Transfer of 100% of Equity Interests in 24 December 2021 www.cninfo.com.cn
Shenzhen Property Management Co.Ltd. (No.: 2021-052)
Announcement on Resolutions of the 3 rd
Extraordinary General Meeting of 2021 30 December 2021 www.cninfo.com.cn
(No.: 2021-053)
Announcement on Progress of the
Related-Party Transaction regarding the
Transfer of 100% of Equity Interests in 15 February 2022 www.cninfo.com.cn
Shenzhen Property Management Co.Ltd. (No.: 2022-001)
Announcement on Completion of the
Related-Party Transaction regarding the
Transfer of 100% of Equity Interest in 30 September 2022 www.cninfo.com.cn
Shenzhen Property Management Co.Ltd. (No.: 2022-032)
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. Major Guarantees
□ Applicable □ Not applicable
Unit: RMB’0000
Guarantees provided by the Company as the parent and its subsidiaries for external parties (exclusive of those for subsidiaries)
Disclosu
re date Guarante
Actual
of the Line of Actual Type of Counter Term of Having e for a
guarante Collatera
Obligor guarante guarante occurren guarante guarante guarante expired related
e
e line e ce date e l (if any) e or not party or
amount e (if any)
announc not
ement
Guarantees provided by the Company as the parent for its subsidiaries
Disclosu Line of Actual Actual Type of Term of Having Guarante
Collatera Counter
Obligor re date guarante occurren guarante guarante guarante expired e for a
of the e ce date e e l (if any) guarante e or not related
52ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
guarante amount e (if any) party or
e line not
announc
ement
From the
date of
signing
100%
the
equity
guarante
interests
e
of
Shenzhe contract
Shenzhe
n SPG to the
n SPG
Chuanqi date
18 Chuanqi
Real 17 June when all
March 50000 6036.68 Pledge Real Not Not
Estate 2022 guarante
2022 Estate
Develop ed debts
Develop
ment are
ment
Co. Ltd. uncondit
Co. Ltd.ionally
held by
and
the
irrevoca
Compan
bly paid
y
off in
full.Total approved line Total actual amount
for such guarantees of such guarantees in
500006036.68
in the Reporting the Reporting Period
Period (B1) (B2)
Total approved line Total actual balance
for such guarantees of such guarantees at
at the end of the 50000 the end of the 6036.68
Reporting Period Reporting Period
(B3) (B4)
Guarantees provided between subsidiaries
Disclosu
re date Guarante
Actual
of the Line of Actual Type of Counter Term of Having e for a
guarante Collatera
Obligor guarante guarante occurren guarante guarante guarante expired related
e
e line e ce date e l (if any) e (if any) e or not party or amount
announc not
ement
Total guarantee amount (total of the three kinds of guarantees above)
Total guarantee line Total actual
approved in the guarantee amount in
500006036.68
Reporting Period the Reporting Period
(A1+B1+C1) (A2+B2+C2)
Total actual
Total approved
guarantee balance at
guarantee line at the
50000 the end of the 6036.68
end of the Reporting
Reporting Period
Period (A3+B3+C3)
(A4+B4+C4)
Total actual guarantee amount (A4+B4+C4)
1.51%
as % of the Company’s net assets
Of which:
Balance of guarantees provided for
shareholders actual controller and their 0
related parties (D)
Balance of debt guarantees provided directly
or indirectly for obligors with an over 70% 0
debt/asset ratio (E)
Amount by which the total guarantee amount
0
exceeds 50% of the Company’s net assets (F)
Total of the three amounts above (D+E+F) 0
Compound guarantees
53ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
3. Cash Entrusted to Other Entities for Management
(1) Cash Entrusted for Wealth Management
□ Applicable □ Not applicable
Overview of cash entrusted for wealth management in the Reporting Period
Unit: RMB’0000
Unrecovered
Unrecovered overdue amount
Type Funding source Amount Undue amount
overdue amount with provision for
impairment
Others Self-owned funds 51604.89 40815.44 0 0
Total 51604.89 40815.44 0 0
High-risk entrusted wealth management with significant single amount or low security and poor liquidity:
□Applicable □ Not applicable
Whether there is the case where the principal cannot be recovered at maturity or other case which may cause impairment for entrusted
wealth management
□Applicable □ Not applicable
(2) Entrusted Loans
□Applicable □ Not applicable
No such cases in the Reporting Period.
4. Other Major Contracts
□Applicable □ Not applicable
No such cases in the Reporting Period.XVI Other Significant Events
□ Applicable □ Not applicable
1. During the Reporting Period Shenzhen Investment Holdings Co. Ltd. a controlling shareholding of the Company
carried out share reduction. From 30 August to 30 December 2022 SIHC reduced its holdings of 14241998 shares of
the Company through call auction accounting for 1.4078% of the total share capital of the Company. As at the end of
the Reporting Period SIHC was still holding 564353838 shares of the Company accounting for 55.78% of the total
share capital of the Company. For more details please refer to the Pre-disclosure on Reduction of Shares Held by
Controlling Shareholders (Announcement No. 2022-026) Progress on Reduction of Shares Held by Controlling
Shareholders (Announcement No. 2022-031) Announcement on Half Time Left for Reduction of Shares Held by
Controlling Shareholders (Announcement No. 2022-033) Announcement on 1% Reduction of Shares Held by
Controlling Shareholders (Announcement No. 2022-046) and Announcement on Expiration of Reduction of Shares
Held by Controlling Shareholders (Announcement No. 2023-001) disclosed on 30 July 3 September 28 October 10
December 2022 and 4 January 2023 respectively.
2. During the Reporting Period Chairman Mr. Liu Zhengyu of the Company no longer serves as the Chairman of the
Board of Directors or a director of the Company due to job changes. Upon joint recommendation of all the current
directors of the Company Director and General Manager Mr. Tang Xiaoping of the Company will exercise the duties
54ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
of Chairman from 1 November 2022 to the date when the new chairman is elected by the Board of Directors of the
Company. For details please refer to the Announcement on Leave of Chairman and Election of A Director to Act as
the Chairman (Announcement No. 2022-040) disclosed by the Company on 2 November 2022.XVII Significant Events of Subsidiaries
□Applicable □ Not applicable
55ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Part VII Share Changes and Shareholder Information
I Share Changes
1. Share Changes
Unit: share
Before Increase/decrease (+/-) After
Shares
as
Shares as
divide
Percen dividend Percen
New nd Subtot
Shares tage converted Other Shares tage
issues conver al
(%) from capital (%)
ted
reserves
from
profit
1. Restricted shares 0.00 0.00% 0.00 0.00 0.00 0.00 0.00 0.00 0.00%
1.1 Shares held by the state 0.00 0.00% 0.00 0.00 0.00 0.00 0.00 0.00 0.00%
1.2 Shares held by state-
0.000.00%0.000.000.000.000.000.000.00%
own Legal-person
1.3 Shares held by other
0.000.00%0.000.000.000.000.000.000.00%
domestic investors
Among which: shares held
0.000.00%0.000.000.000.000.000.00%
by domestic legal person
Shares held by domestic
0.000.00%0.000.000.000.000.000.000.00%
natural person
1.4 Oversea shareholdings 0.00 0.00% 0.00 0.00 0.00 0.00 0.00 0.00%
Among which: shares held
0.000.00%0.000.000.000.000.000.000.00%
by oversea legal person
Shares held by oversea
0.000.00%0.000.000.000.000.000.000.00%
natural person
1011
1011660100.0100.0
2. Unrestricted shares 0.00 0.00 0.00 0.00 0.00 6600
000.000%0%
00.00
8916
891660088.1488.14
2.1 RMB ordinary shares 0.00 0.00 0.00 0.00 0.00 6000
00.00%%
0.00
1200
2.2 Domestically listed 1200000 11.86 11.86
0.000.000.000.000.000000
foreign shares 00.00 % %
0.00
2.3 Oversea listed foreign
0.000.00%0.000.000.000.000.000.000.00%
shares
2.4 Other 0.00 0.00% 0.00 0.00 0.00 0.00 0.00 0.00 0.00%
1011
1011660100.0100.0
3. Total shares 0.00 0.00 0.00 0.00 0.00 6600
000.000%0%
00.00
Reasons for share changes:
□Applicable □ Not applicable
Approval of share changes:
□Applicable □ Not applicable
Transfer of share ownership:
□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:
56ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
□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
1. Securities (Exclusive of Preferred Shares) Issued in the Reporting Period
□Applicable □ Not applicable
2. Changes to Total Shares Shareholder Structure and Asset and Liability Structures
□Applicable □ Not applicable
3. Existing Staff-Held Shares
□Applicable □ Not applicable
III Shareholders and Actual Controller
1. Shareholders and Their Shareholdings at the Period-End
Unit: share
Number of
Number of Number of preferred
ordinary
Number of preferred shareholders with
shareholders
ordinary 4840 shareholders with resumed voting rights at
50795 at the month- 0 0
shareholder 3 resumed voting the month-end prior to the
end prior to
s rights (if any) disclosure of this Report
the disclosure
(see note 8) (if any) (see note 8)
of this Report
Shareholding of ordinary shareholders holding more than 5% shares or the top 10 of ordinary shareholders
Increase Pledged marked or frozen
Number of
and shares
shareholdin
Holding decrease of Number of Number of
Name of Nature of g at the end
percentage shares restricted unrestricted
shareholder shareholder of the Status of
(%) during shares shares Amount
Reporting shares
Reporting
Period
Period
Shenzhen State-
Investment owned 56435383 - 56435383
55.78%0
Holdings legal 8.00 14241998 8.00
Co. Ltd person
Shenzhen
Domestic
State-
non-state-
owned 64288426. 64288426.owned 6.35%
Equity
legal 00 00
Manageme
person
nt Co. Ltd.Domestic
Yang 9219677.0 9219677.0
natural 0.91% 4705000
Jianmin
person 0 0
Domestic 5188800.0 5188800.0
Pan Jun 0.51% 1899900
natural 0 0
57ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
person
Domestic
Zhang 4101200.0 4101200.0
natural 0.41% 503900
Xiujuan person 0 0
Domestic
4005286.04005286.0
He Qiao natural 0.40% 2278300
person 0 0
Domestic
Wang 3403891.0 3403891.0
natural 0.34% 1074200
Yulan
person 0 0
Domestic
Cao 3356800.0 3356800.0
natural 0.33% 2010300
Benming person 0 0
Domestic
Lin 2600000.0 2600000.0
natural 0.26% -516400
Weirong person 0 0
China
State-
Internation
owned 2147724.0 2147724.0
al Capital 0.21%
legal 0 0
Corporatio
person
n Limited
Strategic investor or general legal
person becoming a top-10
None
ordinary shareholder due to rights
issue (if any) (see note 3)
Among the top 10 shareholders of the Company Shenzhen State-owned Equity Management
Related or acting-in-concert Co. Ltd. is a wholly-owned subsidiary of Shenzhen Investment Holdings Co. Ltd. The
parties among the shareholders Company does not know whether there exists associated relationship among the other
above shareholders or whether they are persons acting in concert as prescribed in the
Administrative Measures for the Acquisition of Listed Companies.Explain if any of the shareholders
above was involved in
entrusting/being entrusted with None
voting rights or waiving voting
rights
Special account for share
repurchases (if any) among the None
top 10 shareholders (see note 10)
Top 10 unrestricted shareholders
Shares by type
Name of shareholder Unrestricted shares held at the period-end
Type Shares
RMB
Shenzhen Investment 56435383
564353838.00 ordinary
Holdings Co. Ltd
shares 8.00
Shenzhen State-owned RMB
64288426.
Equity Management Co. 64288426.00 ordinary
Ltd. shares 00
RMB
9219677.0
Yang Jianmin 9219677.00 ordinary
shares 0
RMB
5188800.0
Pan Jun 5188800.00 ordinary
shares 0
RMB
4101200.0
Zhang Xiujuan 4101200.00 ordinary
shares 0
RMB
He Qiao 3852600 ordinary 3852600
shares
Domestical
ly listed
He Qiao 152686 152686
foreign
shares
RMB
3403891.0
Wang Yulan 3403891.00 ordinary
shares 0
RMB
Cao Benming 3356800.00 3356800.0
ordinary
58ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
shares 0
RMB
2600000.0
Lin Weirong 2600000.00 ordinary
shares 0
China International RMB
2147724.0
Capital Corporation 2147724.00 ordinary
0
Limited shares
Among the top 10 unrestricted public shareholders of the Company Shenzhen State-
Related or acting-in-concert parties owned Equity Management Co. Ltd. is a wholly-owned subsidiary of Shenzhen
among top 10 unrestricted public
Investment Holdings Co. Ltd. The Company does not know whether there exists
shareholders as well as between top 10
unrestricted public shareholders and top associated relationship among the other shareholders or whether they are persons
10 shareholders acting in concert as prescribed in the Administrative Measures for the Acquisition of
Listed Companies.Top 10 ordinary shareholders involved in Among the top 10 shareholders of the Company the third fifth sixth and eighth
securities margin trading (if any) (see shareholders respectively held 5368800 shares 4101200 shares 3666300 shares
Note 4) and 3351800 shares in their credit securities 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.□Yes □ No
No such cases in the Reporting Period.
2. Controlling Shareholder
Nature of the controlling shareholder: Controlled by a local state-owned legal person
Type of the controlling shareholder: legal person
Legal
Unified
Name of controlling representative/ Date of
social credit Principal activity
shareholder person in establishment
code
charge
Investment in equities on behalf of the
government and management of those
Shenzhen Investment investments; development and operation of
He Jianfeng 13 October 2004 767566421
Holdings Co. Ltd. government-allocated land; and investment in
and provision of services for strategic
emerging industries
301410000 shares in SZPRD A (000011) representing a stake of 50.57%;;
234070000 shares in STHC (000045) representing a stake of 46.21%;
8210000 shares in Shenzhen Universe A (000023) representing a stake of 5.91%;
962720000 shares in Ping An (601318) representing a stake of 5.27%;
3223110000 shares in Guosen Securities (002736) representing a stake of 33.53%;
609430000 of A shares and 103370000 of H shares in Guotai Junan (601211) representing a stake
Controlling of 8%;
shareholder’s holdings 195030000 shares in Telling Holding (000829) representing a stake of 19.03%;
in other listed 1058720000 shares in Shenzhen International (00152) representing a stake of 44.34%;
companies at home or 604820000 shares in BEAUTYSTAR (002243) representing a stake of 49.96%;
abroad in the Reporting 315830000 shares in Infinova (002528) representing a stake of 26.35%;
Period 388450000 shares in EA (002183) representing a stake of 14.96%;
64350000 shares in SWPD (301038) representing a stake of 37.50%;
6770000 shares in Shenzhen Energy (000027) representing a stake of 0.14%;
9520000 shares in BOCOM (601328) representing a stake of 0.01%;
113980000 shares in Techand Ecology (300197) representing a stake of 4.04%;
77270000 shares in Vanke (02202) representing a stake of 0.66%;
696160000 shares in SEG (000058) representing a stake of 56.54%.
Change of the controlling shareholder in the Reporting Period:
□Applicable □ Not applicable
No such cases in the Reporting Period.
59ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
3. Actual Controller and Its Acting-in-Concert Parties
Nature of the actual controller: Local institution for state-owned assets management
Type of the actual controller: legal person
Legal
Name of actual representative/ Date of Unified social
Principal activity
controller person in establishment credit code
charge
Shenzhen State-owned Perform the responsibilities of investor on
Assets Supervision and behalf of the state and supervise and
Wang Yongjian 31 July 2004 K3172806-7
Administration manage the authorized state-owned assets
Commission legally.Other listed companies
at home or abroad In addition to the Company controlling shareholder - Shenzhen Investment Holding Co. Ltd. Other
controlled by the actual domestic and overseas listed companies whose equity held by the actual controllers did not rank among
controller in the the top ten shareholders of the Company.Reporting Period
Change of the actual controller during the Reporting Period:
□Applicable □ Not applicable
No such cases in the Reporting Period.Ownership and control relations between the actual controller and the Company:
Indicate by tick mark whether the actual controller controls the Company via trust or other ways of asset management.□Applicable □ Not applicable
4. Number of Accumulative Pledged Shares held by the Company’s Controlling Shareholder or the Largest
Shareholder as well as Its Acting-in-Concert Parties Accounts for 80% of all shares of the Company held by
Them
□Applicable □ Not applicable
5. Other 10% or Greater Corporate Shareholders
□Applicable □ Not applicable
60ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
6. Limitations on Shareholding Decrease by the Company’s Controlling Shareholder Actual Controller
Reorganizer and Other Commitment Makers
□Applicable □ Not applicable
IV Specific Implementation of Share Repurchase during the Reporting Period
Progress on any share repurchase:
□Applicable □ Not applicable
Progress on reducing the repurchased shares by means of centralized bidding:
□Applicable □ Not applicable
61ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Part VIII Preference Shares
□Applicable □ Not applicable
No preference shares in the Reporting Period.
62ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Part IX Bonds
□Applicable □ Not applicable
63ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Part X Financial Statements
Type of the audit opinion Unmodified unqualified opinion
Date of signing this report 17 March 2023
Name of the audit institution Grant Thornton Accounting Firm (LLP)
Number of the audit report GTCNSZ（2023）NO.441A000022
Name of the certified public accountants Zhao Juanjuan Jiang Xiaoming
Auditor’s Report
GTCNSZ（2023）NO.441A000022
To the Shareholders of Shenzhen Special Economic Zone Real Estate & Properties
(Group) Co. Ltd:
Opinion
We have audited the financial statement of Shenzhen Special Economic Zone Real
Estate & Properties (Group) Co. Ltd (the "Group") which comprise the consolidated
statement of financial position as at 31 December 2022 and the consolidated statement
of comprehensive income consolidated statement of changes in equity and consolidated
statement of cash flows for the year then ended and the notes to the consolidated
financial statements.In our opinion the accompanying consolidated f inancial statement present fairly in all
material respects the consolidated financial posit ion of the group as at 31 December 2022
and its consolidated financial performance and its consolidated cash flows for the year
then ended in accordance with Accounting Standards for Business Enterprises.Basis for Opinion
We conducted our audit in accordance with China Standards on Auditing. Our
responsibilit ies under those standards are further described in the Auditor’s
Responsibilities for the Audit of the Financial Statement Section of our report. We are
independent of the Group in accordance with the Code of Ethics for Chinese Certif ied
Public Accountant (Ethics Code) together with the ethical requirements that are relevant
to our audit of the financial statements and we fulfilled our other ethical responsibilit ies
in accordance with these requirements and the Ethics Code. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.Key audit matters
Key audit matters are those matters that in our professional judgment were of most
64ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
significance in our audit of the consolidated financial statements of the current period. These
matters were addressed in the context of our audit of the consolidated financial
65ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
statements as a whole and in forming our opinion thereon and we do not provide a separate
opinion on these matters.I. Recognition of revenue from sales of properties
The relevant information disclosure is detailed in Note III. 24 and Note V.35.
1. Description of the matter
In 2022 the revenue from sales of properties is CNY 3.09 billion which accounts for 48.76%
of total revenue of the Group.The Group recognizes the revenue of sales of properties when all of the following
condit ions have been met: * sales contract is signed and filed with housing construction
bureau;* properties were completed and passed acceptance inspection; * for lump-
sum settlement payment has been received in full; for mortgage the first installment
payment has been received and approval procedures of bank mortgage have been
completed;* the procedures of housing delivery have completed in accordance with the
requirements of the sales contract.Due to the importance of revenue from sales of properties and any misstatements in
revenue recognition will have a significant impact on the profit of the Group. Therefore
the recognition of revenue from sales of properties is identified as a key audit matter.
2. Audit response
Our audit procedures for the recognition of revenue from sales of properties include:
* Understanding assessing and testing the design and implementation of key internal
controls about the progress of contract performance and revenue recognition.* Examining the main clauses in sales contracts to evaluate the appropriateness of the
Group’s revenue recognition policy associated with the relevant accounting standards;
* Performing tests on a sample basis to examine contracts of sales of properties
trace to collection of revenue and check letter of admission (elements of revenue
66ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
recognition) in order to assess the compliance with the Group’s revenue recognition policy.* Evaluating the revenue of sales of properties on sample basis before and after the
balance sheet date by checking to sales contracts revenue collection and the letter of
admission for the appropriateness of the period of revenue recognition
* Calculating average house price and comparing it with the price from last year to analyze
the reasonableness of revenue and gross profit.* Evaluating the appropriateness of accounting treatment presentation and disclosure
of the revenue recognition of sales of properties and other relevant information by the
Group in the financial statements.II. Provision of land appreciation tax
The relevant information disclosure is detailed in Note III、32、Note IV 、tax and Note V、
36.
1. Description of the matter
Land appreciation tax is one of the major tax of the group. The amount of land value-
added tax during reporting period is CYN 68.99 million.The sale of developed real estate is subject to land value-added tax at a progressive rate
of 30% - 60% on the land appreciation. At the end of each financial reporting period the
management needs to estimate the accrued amount of land appreciation tax. When
making estimation judgments the main factors to be considered include the prov isions
and interpretations of relevant tax laws and regulations and the estimated income from
the sale of properties minus estimated deductible land costs real estate development
costs interest expenses development expenses etc. When Shenzhen Real Estate
Group sett les and settles the land appreciation tax the actual tax payable may be
different from the amount estimated by Shenzhen Real Estate Group.Due to the importance of the LAT accrual to the consolidated financial statements and
management's judgment when making estimates includes consideration of relevant tax
laws and regulations and practical practices. Therefore we identif ied the accrual of LAT
of the Group as a key audit matter.
67ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
2. Audit response
For the provision and evaluation of land value-added tax we mainly performed the following
audit procedures:
* Evaluating the design and effectiveness of key internal controls related to the
measurement of LAT;
* Involving our internal tax specialists in the PRC to assess the provision of LAT on 31
December 2022 on basis of our experience knowledge understanding of the practical
operation of relevant tax laws by local tax authorit ies to evaluate the Group’s
assumptions and judgments;
* Evaluating the management's expected estimates of the estimated income from the
sale of real estate and the amount of deductible items and assess the Group’s
assumptions and judgments;
* Recalculating the amount of provision of LAT and comparing it to management estim ate.III. Assessment of Inventory’s net realizable value
The relevant information disclosure is detailed in Note III. 12 and Note V.7.
1. Description of the matter
The Group’s finished goods work in progress and products to be developed (hereinafter
referred to as "Inventory") are measured at the lower of cost and net realizable value.The ending balance of inventory was 4.257 billion yuan accounting for 74.82% of the
ending balance of the Group’s total assets.Management determines the net realizable value of each inventory item at the balance
sheet date. In determining the net realizable value of inventory management is required
to provide an up-to-date estimate of the construction costs to be incurred for each
product to be developed and work in progress until completion and to estimate the
expected future net selling price (with reference to the recent transaction price of the real
estate project in the vicinity) and the future selling costs as well as the related sales tax
for each inventory.
68ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Due to the importance of inventories to the assets of the Group and the inherent risks of
estimating the construction costs and future net selling prices to be incurred when
inventory items reach completion status especially in view of the current economic
environment the assessment of the net realizable value of the group's inventory is
identified as a key audit matter.
2. Audit response
For assessing the net realizable value of inventory we mainly performed the following
audit procedures:
* Understanding and evaluating the design and operational effectiveness of key internal
controls related to real estate development cost budgeting dynamic cost management
and estimates of net realizable value;
* Organizing filed trips to real estate development projects based on selected samples and
ask the development progress and dynamic cost budget of these projects
* Evaluating the management's calculation method of expected future selling price
future selling cost and related sales taxes such as by comparing the estimated selling
price with market availability data and the project's sales budget plan;
* Reconciling the actual costs of inventory in current real estate development projects
with the latest project budget and comparing the latest budgeted costs as of 31
December 2022 with those as of 31 December 2021 to evaluate the accuracy of
management forecasts;
* Recalculating the net realizable value of inventory and comparing it to management
estimate.Other Information
Management of Shenzhen Special Economic Zone Real Estate & Properties (Group) Co.Ltd (the "Management") is responsible for the other information. The other information
comprises the information included in the Annual Report of 2022 but does not include
the financial statements and our auditor’s report thereon.
69ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Our opinion on the f inancial statements does not cover the other information and we do
not express any form of assurance conclusion thereon.In connection with our audit of financial statements our responsibility is to read the other
information and in doing so consider whether the other information is materially inconsistent
with the financial statements or our knowledge obtained in the audit or otherwise appears to
be materially misstated.If based on the work we have performed we conclude that there is material
misstatement of this other information we are required to report that fact. We have
nothing to report in this regard.Responsibilities of Management and Those Charge with Governance for the Financial
Statement
The Management is responsible for the preparation and fair presentation of the financial
statement in accordance with Accounting Standards for Business Enterprises and for such
internal control as management determines in necessary to enable the preparation of
financial statements that are free form material misstatement whether due to fraud or error.In preparing the financial statements management is responsible for assessing the
Group’s ability to continue as a going concern disclosing as applicable matters related
to going concern and using the going concern basis of accounting unless management
either intends to liquidate the Group or to cease operations or has no realist ic alternative
but to do so.Those charge with governance are responsible for overseeing the Group’s financial report ing
process.Auditor’s Responsibilities for the Audit of the Financial Statement
Our objectives are to obtain reasonable assurance about whether the financial
statements as a whole are free from material misstatement whether due to fraud or error
and to issue an auditor’s report that includes our opinion. Reasonable assurance is a
high level of assurance but is not a guarantee that an audit conducted in accordance
with China Standards on Auditing will always detect a material misstatement when it exists.Misstatements can arise form fraud or error and are considered material if
70ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
individually or in the aggregate they could reasonably be expected to influence the
economic decisions of users taken on the basis of these financial statements.As part of an audit in accordance with China Standards on Audit ing we exercise
professional judgment and maintain professional skepticism throughout the audit. We also:
* Identify and assess the risks of material misstatement of the financial statements
whether due to fraud or error design and perform audit procedures responsive to
those risks and obtain audit evidence that is sufficient and appropriate to provide a
basis for our opinion. The risk of not detecting a material misstatement resulting
from fraud is higher than for one resulting from error as fraud may involve collus ion
forgery intentional omissions misrepresentations or the override of internal control.* Obtain an understanding of internal control relevant to the audit in order to design
audit procedures that are appropriate in the circumstances.* Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by management.* Conclude on the appropriateness of management’s use of the going concern basis
of accounting and based on the audit evidence obtained whether a material
uncertainty exists related to events or conditions that may cast signif icant doubt on
the Group’s ability to continue as a going concern. If we conclude that a material
uncertainty exists we are required to draw attention in our auditor’s report to the
related disclosures in the financial statements or if such disclosures are inadequate
to modify our opinion. Our conclusions are based on the audit ev idence obtained up
to the date of our auditor’s report. However further events or condit ions may cause
the Group to cease to continue as a going concern.* Evaluate the overall presentation structure and content of the financial statements
and whether the financial statements represent the underlying transactions and
events in a manner that achieves fair presentation.* Obtain sufficient appropriate audit evidence regarding the financial information of
the entit ies or business activit ies within Group to express an opinion on the
consolidated f inancial statements. We are responsible for the direction supervision
and performance of the group audit. We remain solely responsible for our audit
opinion.
71ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
We communicate with those charged with governance regarding among other matters
the planned scope and timing of the audit and significant audit findings including any
significant deficiencies in internal control that we identify during our audit.We also provide those charged with governance a statement that we have complied with
the ethical requirements relating to our independence and communicate to those
charged with governance relationships and other matters that may reasonably be
believed to affect our independence as well as the relevant precautions if applicable.From the matters we communicated with those charged with governance we determined
which matters were most material to the audit of the financial statements for the current
period and thus constituted the key audit matters. We describe such matters in our audit
reports unless laws and regulations prohibit public disclosure of such matters or in rare
circumstances we determine that we should not communicate a matter in our audit
report if it is reasonably expected that the negative consequences of communicating
such matter in our audit report would outweigh the benefits in the public interest.Grant Thornton Auditor's signature and stamp：Zhao Juanjuan
China ·Beijing Auditor's signature and stamp：Jiang Xiaoming
17 March 2023
72ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Balance Sheet
Prepared by：Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd Expressed in CNY
As at 31/12/2022 As at 31/12/2021
Item Note
Consolidated Company Consolidated Company
Current assets:
Cash at bank and on hand V、1 197663949.74 92377124.60 564358824.63 304130181.74
Trading financial assets V、2 408154361.42 408154361.42 514024710.91 514024710.91
Bills receivable V、3 1536150.00 - 3530537.37 -
Accounts receivable V、4 63580422.16 11706678.21 61048785.11 9708285.93
Accounts receivable financing - - - -
Prepayments V、5 1163612.24 200000.00 4899011.32 200000.00
Other receivables including： V、6 42105050.33 1711880332.45 30614008.08 1587300891.76
interests receivables dividends - - - -
receivables Inventories - 39222722.88 1052192.76 -
Contract assets V、7 4257109614.31 4854703.53 4034933562.62 42348499.39
Assets held for sale - - - -
Non-current assets due within one year V、8 - - 78940232.10 12821791.52
Other current assets - - - -
Total current assets V、9 36778641.42 1138065.43 68216887.04 7144189.24
Non-current assets: 5008091801.62 2230311265.64 5360566559.18 2477678550.49
Debt investments
Other debt investments - - - -
Long-term receivables - - - -
Long-term equity investments - - - -
Investment in other equity instruments V、10 93927.64 1582275489.49 272168.28 1582657055.03
Other financial non-current assets V、11 13839235.57 13839235.57 36322704.33 13831938.92
Investment properties - - - -
Fixed assets V、12 566873915.07 455917024.15 588865777.16 476622089.39
Construction in progress V、13 21425475.05 14046375.35 23920424.55 15722627.74
Productive biological assets - - - -
Oil and gas assets - - - -
Right of use assets - - - -
Intangible assets V、14 232496.72 - 365351.97 -
Development costs V、15 - - - -
Goodwill - - - -
Long-term deferred expenses - - - -
Deferred tax assets V、16 2176221.53 1381401.99 2164963.18 1167500.83
Other non-current assets V、17 77036728.98 29502067.58 170020101.78 134299017.38
Total non-current assets - - - -
Total assets 681678000.56 2096961594.13 821931491.25 2224300229.29
5689769802.184327272859.776182498050.434701978779.78
73ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Balance Sheet(continued)
Prepared by：Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd Expressed in CNY
As at 31/12/2022 As at 31/12/2021
Item Note
Consolidated Company Consolidated Company
Current liabilities:
Short-term loans V、18 51138077.62 - 50440116.24 -
Trading financial liabilities - - - -
Bills payable V、19 - - 247376403.56 -
Accounts payable V、20 434601559.67 17666752.61 141447559.24 29750790.44
Advances from customers V、21 5465343.96 - 6411427.04 -
Contract liabilities V、22 43533467.29 184985.71 199965490.08 159752627.50
Employee benefits payable V、23 35724203.78 21167813.42 43926711.78 33496830.45
Taxes payable V、24 190951185.99 178147095.75 600540872.48 588031923.05
Other payables V、25 574331340.84 184614308.51 581377415.64 207613656.49
Including: interests payables 16535277.94 16535277.94 16535277.94 16535277.94
dividends payables - - - -
Liabilities held for sale V、8 - - 65752452.06 -
Non-current liabilities due within one year V、26 6188794.43 - 83023.44 -
Other current liabilities V、27 3882817.68 9249.29 8196849.13 7987260.50
Total current liabilities 1345816791.26 401790205.29 1945518320.69 1026633088.43
Non-current liabilities:
Long-term loans V、28 54261000.00 - - -
Debentures payable - - - -
Leased liabilities V、29 53885.23 - 125920.77 -
Long-term payables - - - -
Provisions - - - -
Deferred income - - - -
Deferred tax liabilities V、17 3096348.02 3096348.02 9524639.56 5027520.65
Other non-current liabilities - - - -
Total non-current liabilities 57411233.25 3096348.02 9650560.33 5027520.65
Total liabilities 1403228024.51 404886553.31 1955168881.02 1031660609.08
Share capital V、30 1011660000.00 1011660000.00 1011660000.00 1011660000.00
Capital reserve V、31 978244910.11 964711931.13 978244910.11 964711931.13
Less: treasury shares - - - -
Other comprehensive income V、32 25926720.85 1379426.68 36088963.95 1373954.19
Specific reserve - - - -
Surplus reserve V、33 275253729.26 252124115.85 241144854.93 218015241.52
Retained earnings V、34 1713155187.48 1692510832.80 1671121562.98 1474557043.86
Total equity attributable to shareholders of the 4004240547.70 3922386306.46 3938260291.97 3670318170.70
Non-controlling interests 282301229.97 - 289068877.44 -
Total shareholders' equity 4286541777.67 3922386306.46 4227329169.41 3670318170.70
Total liabilities and shareholders' equity 5689769802.18 4327272859.77 6182498050.43 4701978779.78
Legal reprensentative: The person in charge of accounting affairs: The head of the accounting department:
74ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Income Statement
For the year ended 31December 2022
Prepared by：Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd Expressed in CNY
Year ended 31/12/2022 Year ended 31/12/2021
Item Note
Consolidated Company Consolidated Company
I. Operating income V、 35 634384561.42 207149569.13 1320790648.45 774065610.33
Less: operating costs V、35 437052001.01 66761336.83 666348361.48 198814980.86
Taxes and surcharges V、36 81783491.54 34857919.27 254360315.85 239589346.99
Selling and distribution expenses V、37 19217595.11 1693651.82 42737748.22 25703001.79
General and administrative expenses V、38 55758749.08 31384870.71 98307831.60 62162730.22
Research and development expenses - - - -
Financial expenses V、39 -6507147.03 -57765779.16 -18083491.01 -35842822.63
Including: Interest expenses - - 9920.46 -
Interest income 5315817.53 42340594.39 28863878.27 41651307.37
Add: Other income V、40 559803.19 290331.32 1669479.40 41188.24
Investment income ("-" for losses) V、41 164986548.17 280973270.14 1783839.07 1783839.07
Including: Income from investment
in associates and -178240.64 -178240.64 -105321.37 -105321.37
joint ventures ("-" for losses)
Gain from derecognition of financial assets measured at
----
amortized cost ("-" for losses)
Net exposure hedging gains ("-" for losses) - - - -
Gains from changes in fair value ("-" for losses) V、42 8970031.50 8970031.50 11828130.44 11828130.44
Credit impairment losses ("-" for losses) V、43 -6516237.34 -402823.92 -7795219.71 -153318.35
Impairment losses ("-" for losses) V、44 -532397.57 - 268941.60 -
Gains from assets disposal ("-" for losses) V、45 - - -8852.73 -
II. Operating profit ("-" for losses) 214547619.66 420048378.70 284866200.38 297138212.50
Add: Non-operating income V、46 1534651.38 350103.89 1746134.87 1584736.54
Less: Non-operating expenses V、47 478942.74 308559.95 208129.74 32989.65
III. Profit before income tax ("-" for losses) 215603328.30 420089922.64 286404205.51 298689959.39
Less: Income tax expenses V、48 66026457.35 79001179.37 68804535.78 74484146.80
IV. Net profit for the year ("-" for net losses) 149576870.95 341088743.27 217599669.73 224205812.59
(1) Classification according to operation continuity
Including: Net profit from continuing operations
139931713.54341088743.27214252742.25224205812.59
("-" for net loss)
Net profit from discontinued operations 9645157.41 3346927.48
("-" for net loss)
(2) Classification according to attibute
Including: Members of the parent entity("-" for net loss) 153718805.57 341088743.27 220836309.93 224205812.59
Non-controlling interests("-" for net loss) -4141934.62 -3236640.20
V. Other comprehensive income net of tax -1338182.69 5472.49 8837349.05 242802.45
Other comprehensive income (net of tax) attributable to 1287530.16 5472.49 7925913.82 242802.45
members of the parent entity
A. Items that will not be reclassified to profit or loss -1314647.75 5472.49 -891117.14 242802.45
a. Changes in fair value of other equity instrument -1314647.75 5472.49 -891117.14 242802.45
investments
B. Items that may be reclassified to profit or loss 2602177.91 - 8817030.96 -
a. Translation differences arising from translation of 2602177.91 - 8817030.96 -
foreign currency financial statements
Other comprehensive income (net of tax) attributable to non-
-2625712.85911435.23
controlling interests
VI. Total comprehensive income for the year 148238688.26 341094215.76 226437018.78 224448615.04
Attributable to:
155006335.73341094215.76228762223.75224448615.04
members of the parent entity
Non-controlling interests -6767647.47 -2325204.97
VII. Earnings per share
(1) Basic earnings per share 0.1519 0.2183
(2)Diluted earnings per share 0.1519 0.2183
Legal reprensentative: The person in charge of accounting affairs: The head of the accounting department:
75ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Cash Flow Statement
For the year ended 31 December 2022
Prepared by：Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd Expressed in CNY
Year ended 31/12/2022 Year ended 31/12/2021
Item Note
Consolidated Company Consolidated Company
I .Cash flows from operating activities
Proceeds from sales of goods or rendering of services 511011815.61 49012283.37 1427249424.24 800728093.14
Refund of taxes 132838815.39 76682094.30 - -
Proceeds from other operating activities V、49 24599301.34 45702753.43 378597082.00 55262411.37
Sub-total of cash inflows 668449932.34 171397131.10 1805846506.24 855990504.51
Payment for goods and services 641103390.35 14097081.25 2301256194.02 53822715.55
Payment to and for employees 89495463.28 41433458.97 191511263.39 55225745.09
Payments of various taxes 540305543.96 506294532.81 235554836.77 276459274.35
Payment for other operating activities V、49 73321533.51 48529139.31 283476320.00 472880097.57
Sub-total of cash outflows 1344225931.10 610354212.34 3011798614.18 858387832.56
Net cash flows from operating activities -67577 5 99 8 .7 6 -43895 7 08 1 .2 4 -1205952107.94 -2397328.05
I I .Cash flows from investing activities
Proceeds from disposal of investments - - -
Investment income received 10527896.61 10042199.78 1889160.44 1889160.44
Net proceeds from disposal of fixed assets intangible assets and
2907.502907.50162961.511253.56
other long-term assets
Net proceeds from disposal of subsidiaries and other business units 157395480.90 196676700.00 - -
Proceeds from other investing activities V、49 114840380.99 114840380.99 797803419.53 797803419.53
Sub-total of cash inflows 282766666.00 321562188.27 799855541.48 799693833.53
Payment for acquisition of fixed assets intangible assets and other
713537.29458195.931845495.541283857.85
long-term assets
Payment for acquisition of investments - - -
Net payment for acquisition of subsidiaries and other business units - - 449776436.75 1444894678.60
Payment for other investing activities V、49 - - 1300000000.00 1300000000.00
Sub-total of cash outflows 713537.29 458195.93 1751621932.29 2746178536.45
Net cash flows from investing activities 282053128.71 321103992.34 -95176 6 39 0 .8 1 -1946484702.92
I I I .Cash flows from financing activities
Proceeds from investors - - - -
Including: Proceeds from non-controlling shareholders of subsidiaries - - - -
Proceeds from borrowings 111428077.62 - 50440116.24 -
Proceeds from other financing activities V、49 - - 215816852.52 22800000.00
Sub-total of cash inflows 111428077.62 - 266256968.76 22800000.00
Repayments of borrowings 50440116.24 - 76893995.94 -
Payment for dividends profit distributions or interest 89685993.21 89026080.00 88014420.00 88014420.00
Including: Dividends and profits paid to non-controlling
---
shareholders of subsidiaries
Payment for other financing activities - - -
Sub-total of cash outflows 140126109.45 89026080.00 164908415.94 88014420.00
Net cash flows from financing activities -28698 0 31 .8 3 -89026 0 80 .0 0 101348552.82 -65214 4 20 .0 0
IV.Effect of foreign exchange rate changes on cash and cash
492336.21--440345.74-
equivalents
V.Net increase in cash and cash equivalents -42192 8 56 5 .6 7 -20687 9 16 8 .9 0 -2056810291.67 -2014096450.97
Add: Cash and cash equivalents at the beginning of the year 612293635.15 297680168.50 2669103926.82 2311776619.47
VI.Cash and cash equivalent at the end of the year 190365069.48 90800999.60 612293635.15 297680168.50
Legal reprensentative: The person in charge of accounting affairs: The head of the accounting department:
76ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Consolidated Statement of Changes in Shareholders' Equity
For the year ended 31 December 2022
Prepared by：Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd Expressed in CNY
Year ended 31/12/2022
Attributable to shareholders' equity of the parent company
Item Non-controlling
Less: treasury Other Specific Total
Share capital Capital reserve Surplus reserve Retained earnings interests
shares comprehensive reserve
I.Balance at the end of last year 1011660000.00 978244910.11 - 36088963.95 - 241144854.93 1671121562.98 289068877.44 4227329169.41
Add：Changes in accounting policies - - - - - - - - -
Correction of prior period errors - - - - - - - - -
business combinations under common control - - - - - - - - -
Other - - - - - - - - -
II.Balance at the beginning of the year 1011660000.00 978244910.11 - 36088963.95 - 241144854.93 1671121562.98 289068877.44 4227329169.41
III.Changes in equity during the year( "- "for decrease) - - - -10162243.10 - 34108874.33 42033624.50 -6767647.47 59212608.26
(I)Total comprehensive income - - - 1287530.16 - - 153718805.57 -6767647.47 148238688.26
(II)Shareholders' contributions and decrease of capital - - - - - - - - -
1.Contribution by ordinary shareholders - - - - - - - - -
2. Equity settled share-based payments - - - - - - - - -
3. Others - - - - - - - - -
(III) Appropriation of profits - - - - - 34108874.33 -123134954.33 - -89026080.00
1. Appropriation for surplus reserves - - - - - 34108874.33 -34108874.33 - -
2. Distributions to shareholders - - - - - - -89026080.00 - -89026080.00
3. Others - - - - - - - - -
(IV) Transfer within equity - - - -11449773.26 - - 11449773.26 - -
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. Others - - - -11449773.26 - - 11449773.26 - -
(V)Specific Reserve - - - - - - - - -
1. Appropriation during the year - - - - - - - - -
2.Utilisation during the year - - - - - - - - -
(VI)Others - - - - - - - - -
IV.Balance at the end of the year 1011660000.00 978244910.11 - 25926720.85 - 275253729.26 1713155187.48 282301229.97 4286541777.67
Legal reprensentative: The person in charge of accounting affairs: The head of the accounting department:
77ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Prepared by：Shenzhen Special Economic Zone Real Estate and Expressed in CNY
Year ended 31/12/2021
Attributable to shareholders' equity of the parent company
Item Non-controlling
Less: treasury Other Specific Total
Share capital Capital reserve Surplus reserve Retained earnings interests
shares comprehensiv reserve
I.Balance at the end of last year 1011660000.00 978244910.11 - 28163050.13 - 218724273.67 1560720254.31 -140425233.06 3657087255.16
Add：Changes in accounting policies - - - - - - - - -
Correction of prior period errors - - - - - - - - -
business combinations under common control - - - - - - - - -
Other - - - - - - - - -
II.Balance at the beginning of the year 1011660000.00 978244910.11 - 28163050.13 - 218724273.67 1560720254.31 -140425233.06 3657087255.16
III.Changes in equity during the year( "- "for decrease) - - - 7925913.82 - 22420581.26 110401308.67 429494110.50 570241914.25
(I)Total comprehensive income - - - 7925913.82 - - 220836309.93 -2325204.97 226437018.78
(II)Shareholders' contributions and decrease of capital - - - - - - - - -
1.Contribution by ordinary shareholders - - - - - - - - -
2. Equity settled share-based payments - - - - - - - - -
3. Others - - - - - - - - -
(III) Appropriation of profits - - - - - 22420581.26 -110435001.26 - -88014420.00
1. Appropriation for surplus reserves - - - - - 22420581.26 -22420581.26 - -
2. Distributions to shareholders - - - - - - -88014420.00 - -88014420.00
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. Others - - - - - - - - -
(V)Specific Reserve - - - - - - - - -
1. Appropriation during the year - - - - - - - - -
2.Utilisation during the year - - - - - - - - -
(VI)Others - - - - - - - 431819315.47 431819315.47
IV.Balance at the end of the year 1011660000.00 978244910.11 - 36088963.95 - 241144854.93 1671121562.98 289068877.44 4227329169.41
Legal reprensentative: The person in charge of accounting affairs: The head of the accounting department:
78ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Statement of Changes in Shareholders' Equity
For the year ended 31 December 2022
Prepared by：Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd Expressed in CNY
Year ended 31/12/2022
Item Less: Other Specific Retained
Share capital Capital reserve Surplus reserve Total
treasury comprehensiv reserve earnings
I.Balance at the end of last year 1011660000.00 964711931.13 - 1373954.19 - 218015241.52 1474557043.86 3670318170.70
Add：Changes in accounting policies - - - - - - - -
Correction of prior period errors - - - - - - - -
Others - - - - - - - -
II.Balance at the beginning of the year 1011660000.00 964711931.13 - 1373954.19 - 218015241.52 1474557043.86 3670318170.70
III.Changes in equity during the year( "- "for decrease) - - - 5472.49 - 34108874.33 217953788.94 252068135.76
(I)Total comprehensive income - - - 5472.49 - - 341088743.27 341094215.76
(II)Shareholders ' contributions and decrease of capital - - - - - - - -
1.Contr ibution by ordinary shareholders - - - - - - - -
2. Equity settled share-based payments - - - - - - - -
3. Others - - - - - - - -
(III) Appropriation of profits - - - - - 34108874.33 -123134954.33 -89026080.00
1. Appropriation for surplus reserves - - - - - 34108874.33 -34108874.33 -
2. Distributions to shareholders - - - - - - -89026080.00 -89026080.00
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.Others - - - - - - - -
(V)Specific Reserve - - - - - - - -
1. Appropriation during the year - - - - - - - -
2.Utilisation during the year - - - - - - - -
(VI)Others - - - - - - - -
IV.Balance at the end of the year 1011660000.00 964711931.13 - 1379426.68 - 252124115.85 1692510832.80 3922386306.46
Legal reprensentative: The person in charge of accounting affairs: The head of the accounting department:
79ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Statement of Changes in Shareholders' Equity
For the year ended 31 December 2022
Prepared by：Shenzhen Special Economic Zone Real Estate a Expressed in CNY
Year ended 31/12/2021
Item Less: Other Specific
Share capital Capital reserve Surplus reserve Retained earnings Total
treasury comprehensive reserve
I.Balance at the end of last year 1011660000.00 964711931.13 - 1131151.74 - 195594660.26 1360786232.53 3533883975.66
Add：Changes in accounting policies - - - - - - - -
Correction of prior period errors - - - - - - - -
Others - - - - - - - -
II.Balance at the beginning of the year 1011660000.00 964711931.13 - 1131151.74 - 195594660.26 1360786232.53 3533883975.66
III.Changes in equity during the year( "- "for decrease) - - - 242802.45 - 22420581.26 113770811.33 136434195.04
(I)Total comprehensive income - - - 242802.45 - - 224205812.59 224448615.04
(II)Shareholders ' contributions and decrease of capital - - - - - - - -
1.Contr ibution by ordinary shareholders - - - - - - - -
2. Equity settled share-based payments - - - - - - - -
3. Others - - - - - - - -
(III) Appropriation of profits - - - - - 22420581.26 -110435001.26 -88014420.00
1. Appropriation for surplus reserves - - - - - 22420581.26 -22420581.26 -
2. Distributions to shareholders - - - - - - -88014420.00 -88014420.00
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.Others - - - - - - - -
(V)Specific Reserve - - - - - - - -
1. Appropriation during the year - - - - - - - -
2.Utilisation during the year - - - - - - - -
(VI)Others - - - - - - - -
IV.Balance at the end of the year 1011660000.00 964711931.13 - 1373954.19 - 218015241.52 1474557043.86 3670318170.70
Legal reprensentative: The person in charge of accounting affairs: The head of the accounting department:
80ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Notes to the Financial Statements
I. Company Information
1. Company‘s profile
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 wtih
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 91440300192179585N and the registered capital is CNY 1011660000.00. The Company‘s
headquarter is located 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 Shenzhen
investment Holding Co. Ltd.‖ issued by State-Owned Assets Supervision and Administration
Commission of Shenzhen Municipal Government the former major shareholder – Shenzhen
Construction Investment Holding Company with two assets management companies merged and the
Shenzhen Investment Holding Co. Ltd formed which causes the Company's equity to change. 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 564353838 shares of the Company (55.78% 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 the board of supervisors. At present it has human resources
financing plan department marketing department engineering management department etc.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.These financial statements and notes to the financial statements were approved by the Board of
Directors of the Group at the 78th Board meeting dated on 17 March 2023.
2. Scope of consolidated financial statements
For details about the scope of consolidated statements please refer to Note VII ―Interests in other
entities‖ .Refer to Note VI and VII for changes in consolidation scope in current period.II. The Basis of Preparation of Financial Statements
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
81ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
the Group also discloses relevant financial information in accordance with the China Securities
Regulatory Commission's "Information Disclosure and Reporting Rules for Companies that Public
Issued Securities" No. 15 - General Provisions on Financial Reporting (revised in 2014).These financial statements are presented on going concern basis.The Group 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.III. Significant accounting policies and accounting estimates
The company take its own operation and production characteristics into consideration to determine the
revenue recognition policy. Please refer to Note III.24.
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 Group‘s and the Company‘s financial position as at 31
December 2022 and the Group‘s and the Company‘s operating results and cash flows for the year
ended 31 December 2022.
2. Accounting period
The accounting period of the Group is from 1 January to 31 December.
3. Operating cycle
The Group's operating cycle is 12 months.
4. Functional currency
The Group and domestic subsidiaries (including Hong Kong) use Chinese Yuan (―CNY‖ ) as their
functional currency. Offshore subsidiaries Great Wall Estate Co. LTD determine American dollar as
their functional currency according to the primary economic environment where they operate. The
financial statements of the Group have been prepared in CNY.
5. Accounting treatments for business combinations involving enterprises under common control and
business combinations not involving enterprises under common control
（1） Business combinations involving enterprises under common control
For a business combination involving enterprises under common control the assets acquired and
liabilit ies 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 is adjusted against share premium in the capital reserve
with any excess adjusted against retained earnings.Business combination involving enterprises under common control through step by step multiple
transactions.
82ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
In individual financial statements the share of the net assets of the consolidated party in the book value
of the consolidated financial statements of the ultimate controlling party of the net assets of the
consolidated party on the consolidation date calculated by the shareholding ratio on the consolidation
date shall be taken as the initial investment cost of the investment; the difference between the initial
investment cost and the sum of the book value of the investment held before the merger plus the book
value of the newly consideration paid shall be adjusted for the capital reserve. If the capital reserve is
insufficient to be written down the retained earnings shall be adjusted.In the consolidated financial statement the assets and liabilit ies of the consolidated party shall be
measured according to the book value of the consolidated financial statement of the ultimate controlling
party on the merger date except for the adjustment due to different accounting policies; the balance
between the book value of the investment held before the merger and the book value of the newly
consideration paid and the book value of the net assets obtained during the merger shall be adjusted for
capital reserves. If the capital reserves are insufficient to be written down the retained earnings shall be
adjusted. For long-term equity investment held by the merging party prior to acquiring control of the
merged party the relevant profit and loss other comprehensive income and other changes in owners'
equity which have been recognized by the merging party from later of the date on which the original
equity was acquired and the date on which the merging party and the merged party are ultimately under
the control of the same party to the merging date shall offset the beginning retained earnings or profits
and losses of the current period.
（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 liabilit ies incurred or assumed and equity
securities issued by the acquirer in exchange for control of the acquiree. At the acquisit ion date the
acquired assets liabilities and contingent liabilities of the acquiree are measured at their fair value. The
acquiree‘s identifiable asset liabilit ies 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 combination involving enterprises not under common control through step by step multiple
transactions.In individual financial statements the sum of the book value of the equity investment held by the
purchaser before the purchase date and the cost of the newly added investment on the purchase date is
taken as the initial investment cost of the investment. If other comprehensive income of equity
investment held before the purchase date is recognized by using the equity method such other
comprehensive income will not be treated on the purchase date and the investment will be treated on
the same basis as the direct disposal of relevant assets or liabilities by the invested entity. The owners'
equity recognized as a result of changes in owners' equity other than net profit and loss other
comprehensive income and profit distribution of the investee shall be transferred to the current profit
and loss during the disposal period at the time of disposal of the investment. If the equity investment
held before the purchase date is measured at fair value the accumulated change in fair value originally
83ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
recorded in other comprehensive income is transferred to the profit and loss of the current period when
it is calculated by the cost method.In the consolidated financial statement the consolidated cost is the sum of the consideration paid on the
purchase date and the fair value on the purchase date of the equity held by the Purchaser prior to the
purchase date. For the equity held by the Purchaser before the purchase date it shall be re -measured
according to the fair value of the equity on the purchase date and the difference between the fair value
and the book value shall be recorded into the current income; The equity held by the Purchaser before
the purchase date involves other comprehensive income and other changes in owners' equity turn into
current income on the purchase date except for other comprehensive income generated by changes in
net liabilities or net assets of the remeasured income plan of the investee.
（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 Group 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 Group (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 Group based on the financial statements of
the Group 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 Group and all significant intra-group balances and transactions are eliminated.Where a subsidiary or business was acquired during the report ing 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 report ing period through a business
combination involving enterprises not under common control the identifiable assets and liabilit ies 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
84ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
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） Acquisiton equity from non-controlling shareholder in Subsidiaries
Where the Group 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 Group and to the non-
controlling interest is adjusted to reflect the change in the Group‘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 Group 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 Group
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 Group 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 revenue from the sale of its share of the output arising from the joint operation;
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
85ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
A joint venture is a joint arrangement whereby the joint venturers have rights to the net assets of the
arrangement.The Group 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 Group 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
liabilit ies 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 at the
cash flow occurence 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
A financial instrument is any contract that gives rise to a financial asset of one enterprise and a financial
liability or an equity instrument of another enterprise.
86ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
（1） Recognition and derecognition of financial instruments
A financial asset or a f inancial liability is recognized when the Group becomes a party to the contractual
provisions of a financial instrument.If one of the following criteria is met a financial asset is derecognised:
* the contractual rights to the cash flows from the financial asset expire; or
* The financial asset was transferred and the transfer qualif ies for derecognition in accordance with
criteria set out below in ―Transfer of Financial Assets‖ .A financial liability (or part of it) is derecognized when its contractual obligation (or part of it) is
discharged or cancelled or expires. If the Group (as a debtor) makes an agreement with the creditor to
replace the current financial liability with assuming a new financial liability and contractual provisions
are different in substance the current financial liability is derecognized and a new financial liability is
recognized.If the financial assets are traded regularly the financial assets are recognized and derecognized at the
transaction date.
（2） Classification and measurement of financial assets
The Group classifies financial assets as subsequently measured at amortized cost fair value through
other comprehensive income or fair value through profit or loss at initial recognition on the basis of both
the entity‘s business model for managing the financial assets and the contractual cash flow
characteristics of the financial asset.Financial assets measured at amortized cost
The Group classifies the financial assets that meet the following conditions and are not designated as
measured at fair value through profit or loss as financial assets measured at amortized cost:
* The Group's business model of managing the financial assets is to collect contractual cash flows
as the target;
* The contractual terms of the financial asset give rise on specified dates to cash flows that are
solely payments of principal and interest on the principal amount outstanding.After the initial recognition the effective interest rate method is adopted to measure the amortized cost
of such financial assets. Gains or losses arising from financial assets that are measured at amortized
cost and are not part of any hedging relationship shall be recorded in the current profit or loss when the
recognition is terminated amortized according to the effective interest method or the impairment is
recognized.Financial assets measured at fair value through other comprehensive income
The Group classifies the financial assets that simultaneously meet the following conditions and are not
specified as measured at fair value through profit or loss as financial assets measured at fair value
through other comprehensive income:
87ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
* The Group's business model of managing the financial asset aims at both collecting the contract
cash flow and selling the financial asset.* The contractual terms of the financial asset give rise on specified dates to cash flows that are
solely payments of principal and interest on the principal amount outstanding.After the initial recognition this type of financial assets are subsequently measured at fair value. The
interest impairment loss or gain and exchange loss or gain calculated using the effective interest rate
method are included in the current profit or loss while other gains or losses are included in other
comprehensive income. When derecognized the accumulated gains or losses previously recorded in
other comprehensive income shall be transferred out from other comprehensive income and recorded in
the current profit or loss.Financial assets measured at fair value through profit or loss
In addition to the above financial assets measured at amortized cost and measured at fair value through
other comprehensive income the Group classifies all other financial assets as financial assets
measured at fair value through profit or loss. At the time of 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 measured at fair value through other
comprehensive income as financial assets measured at fair value through profit or loss.After the initial recognit ion this kind of financial asset is subsequently measured at its fair value and the
gains or losses (including interest and dividend income) generated are recorded into the current profit or
loss unless the financial asset is part of the hedging relationship.However for non-trading equity instrument investment the Group irrevocably designates it as a
financial asset measured at fair value through other comprehensive income at the time of initial
recognition. The designation is made on a single investment basis and the relevant investments meet
the definition of an equity instrument from issuer's perspective.After the initial recognit ion this kind of financial assets are subsequently measured at fair value.Satisfied dividend income is included in the profit or loss other gains or losses and changes in fair value
are included in other comprehensive income. When derecognized the accumulated gains or losses
previously recorded in other comprehensive income are transferred out and recorded in retained
earnings.The business model of managing financial assets refers to how the group manages financial assets to
generate cash flows. The business model determines whether the cash flow from the financial assets
under management of the Group is derived from the receipt of contractual cash flows the sale of
financial assets or a combination of both. The Group determines its business model for managing
financial assets on the basis of objective facts and the specific business objectives for the management
of financial assets determined by key management personnel.The Group assesses the contractual cash flow characteristics of financial assets to determine whether
the contractual cash flows generated by the relevant financial assets on specif ied dates are solely
payments of principal and interest on the principal amount outstanding. Principal refers to the fair value
of financial assets at initial recognition. Interest includes consideration for the time value of money the
credit risk associated with the amount of principal outstanding over a given period and other basic
lending risks and costs as well as a profit margin. In addition the Group assesses contractual terms
that may cause a change in the time distribution or amount of the contractual cash flows of financial
88ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
assets to determine whether they meet the requirements of the above contractual cash flow
characteristics.Only when the Group changes the business model of managing financial assets all affected related
financial assets shall be reclassif ied on the first day of the first reporting period after the change of the
business model otherwise the financial assets shall not be reclassified after the initial recognition.Financial assets are measured at fair value at the time of initial recognit ion. For financial assets
measured at fair value through profit or loss relevant transaction costs are directly recorded into current
profit or loss; for other classes of financial assets the relevant transaction costs are included in the
init ial recognition amount. For accounts receivable arising from the sale of products or provision of
services which do not contain or do not take into account the material financing component the Group
is entitled to collect the consideration amount as expected as the initial recognition amount.
（3） Classification and measurement of financial liabilities
At the time of initial recognition the financial liabilities of the Group are classif ied as: financial liabilities
measured at fair value through current profit or loss and financial liabilities measured at amortized cost.For financial liabilities that are not classified as measured at fair value through profit or loss relevant
transaction costs are included in their initial recognized amounts.Financial liabilities measured at fair value through profit or loss
Financial liabilities measured at fair value through profit or loss include trading financial liabilit ies and
financial liabilities designated at the time of initial recognition as measured at fair value through profit
or loss. For such f inancial liabilities the subsequent measurement shall be made according to the fair
value and the gains or losses caused by changes in the fair value as well as the dividends and interest
expenses related to such financial liabilities shall be recorded into current profit or loss.Financial liabilities measured at amortized cost
For other financial liabilities the effective interest rate method shall be adopted and the subsequent
measurement shall be made at the amortized cost and the gains or losses arising from derecognition or
amortization shall be recorded into current profit or loss.The distinction between financial liabilities and equity instruments
Financial liabilities refer to liabilities that meet one of the following conditions:
* A contractual obligation to deliver cash or other financial assets to other parties.* a contractual obligation to exchange financial assets or financial liabilit ies with another party under
potentially adverse conditions.* Non-derivative instrument contracts that will be settled with or available to the firm's own equity
instruments in the future under which the firm will deliver a variable number of its own equity
instruments.* a derivative contract in which the firm's own equity instruments are to be settled or used in the
future except for a derivative contract in which a fixed number of its own equity instruments are to be
exchanged for a fixed amount of cash or other financial assets.
89ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
An equity instrument is a contract that certifies ownership of the remaining interest in an enterprise's
assets after all liabilities have been deducted.If the Group cannot unconditionally avoid fulfilling a contractual obligation by delivering cash or other
financial assets such contractual obligation meets the definition of a financial liability.If a financial instrument is to be settled with or available to the Group's own equity instrument
consideration needs to be given to whether the Group's own equity instrument used to settle the
instrument is to be used as a substitute for cash or other financial assets or to give the holder of the
instrument the remaining interest in the Issuer's assets after deduction of all liabilities. If the former the
instrument is a financial liability of the group; If it is the latter the instrument is an equity instrument of
the Group.
（4） Fair value of financial instruments
For the determination of fair value of financial assets and financial liabilities see Note III. 11.
（5） Impairment of financial assets
On the basis of expected credit losses the Group conducts impairment accounting treatment for the
following items and confirms the loss provision:
* Financial assets measured at amortized cost;
* Receivables and creditor's rights investments measured at fair value and accounted for in other
comprehensive income;
* Contract assets as defined in the Accounting Standards for Business Enterprises No. 14 - Revenue;
* Lease receivables;
* Financial guarantee contract (measured at fair value and its changes included in the current profit
and loss except the financial asset transfer does not meet the conditions for termination of recognition
or continues to involve the transferred financial asset).Measurement of expected credit losses
The term "expected credit loss" refers to the weighted average of the credit loss of a financial instrument
weighted by the risk of default. Credit loss refers to the difference between all contractual cash flows
receivable under the contract and all cash flows expected to be collected by the Group discounted at
the original effective interest rate that is the present value of all cash shortages.The Group calculates the probabilistic weighted amount of the present value of the difference between
the cash flows receivable under the Contract and the cash flows expected to be received and
recognizes the expected credit loss taking into account reasonable and evidential information
concerning past events current conditions and Itemions of future economic conditions and weighting
the risk of default.The Group measures the expected credit losses of financial instruments at different stages. If the credit
risk of the financial instrument has not increased significantly since the initial recognition the Group
shall measure the loss provision in accordance with the expected credit loss in the next 12 months in
90ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
the first stage;If the credit risk of a financial instrument has increased significantly since the initial
recognition but no credit impairment has occurred it is in the second stage and the Group measures
the loss provision according to the expected credit loss of the entire life period of the instrument; If credit
impairment has occurred to a financial instrument since its initial recognit ion it is in the third stage and
the Group shall measure the loss provision according to the expected credit loss of the entire life period
of the instrument.For financial instruments with low credit risk at the balance sheet date the Group assumes that the
credit risk has not increased significantly since the init ial recognition and measures the loss provision in
accordance with the expected credit loss for the next 12 months.The term "expected credit loss over the entire expected life of a financial instrument" refers to the
expected credit loss resulting from all possible events of default during the entire expected life of a
financial instrument. The expected credit loss within the next 12 months refers to the expected credit
loss caused by the default event of the financial instrument that may occur within 12 months after the
date of the balance sheet (or the expected duration of the financial instrument if the expected duration
of the financial instrument is less than 12 months) and is part of the expected credit loss over the entire
maturity period.When measuring expected credit losses the Group shall take into account the longest contract period
(including the option to renew the contract) for which the enterprise is exposed to credit risk.The Group calculates interest income on the basis of the book balance before impairment provisions
and the effective interest rate for financial instruments in stage I and stage II and with lower credit risk.For financial instruments in the third stage the interest income is calculated on the basis of the
amortized cost of the book balance less the impairment provision and the effective interest rate.For notes receivable accounts receivable and contract assets regardless of whether there is a material
financing component the Group always measures its loss provision in accordance with the amount
equivalent to the expected credit loss within the whole duration period.When a single financial asset cannot assess the information of expected credit loss at a reasonable cost
the Group divides the notes receivable and accounts receivable into portfolios according to the credit
risk characteristics calculates the expected credit loss on the basis of the portfolios and determines the
portfolios based on the following:
A. Notes receivable
* Notes receivable portfolio 1: banker acceptance notes
* Notes receivable portfolio 2: commercial acceptance notes
B、Receivables
* Accounts receivable portfolio 1: related parties receivable
* Accounts Receivable Portfolio 2: Receivable from property sales
* Accounts receivable portfolio 3: receivable from other customers
C. Contract assets
91ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
* Contract Portfolio 1: Product Sales
* Contract Portfolio 2: Works Construction
For the notes receivable and contract assets divided into portfolios the Group calculates the expected
credit loss through default risk exposure and the expected credit loss rate over the entire duration by
referring to the historical credit loss experience combining the current situation and the forecast of the
future economic situation.For the receivables divided into portfolios the Group refers to the historical credit loss experience and
combines the current situation with the forecast of the future economic situation to compile a
comparison table between the age of receivables/overdue days and the expected credit loss rate of the
entire duration period to calculate the expected credit loss.Other receivables
The Group divides other receivables into several portfolios according to the credit risk characterist ics
and calculates the expected credit loss on the basis of the portfolio. The basis for determining the
portfolio is as follows:
* Other Receivables Portfolio 1: Receivables from government agencies
* Other Receivables Portfolio 2: Other receivables from employee‘s petty cash
* Other receivables portfolio 3: Other receivables from the collecting and paying on behalf
* Other receivables portfolio 4: Other receivables from other customers
* Other receivables portfolio 5: Receivables from related parties
For other receivables divided into portfolios the Group calculates the expected credit loss by default risk
exposure and the expected credit loss rate over the next 12 months or the entire duration.Debt investment and Other debt investment
For debt investment and other debt investment the Group calculates the expected credit loss based on
the default risk exposure and the expected credit loss rate within the next 12 months or the entire
duration according to the nature of the investment and the various types of counterparties and risk
exposures.An assessment of a significant increase in credit risk
By comparing the risk of default of financial instruments on the balance sheet date with the risk of
default on the init ial recognition date the Group determines the relative change of default risk within the
expected duration of financial instruments so as to evaluate whether the credit risk of financial
instruments has significantly increased since the initial recognition.In determining whether credit risk has increased signif icantly since the initial recognition the Group
considers reasonable and informed information including forward-looking information that can be
obtained without unnecessary additional cost or effort. Information considered by the Group includes:
* The debtor fails to pay the principal and interest as due under the contract;
92ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
* A material deterioration if any of the external or internal credit rating of the financial instrument that
has occurred or is expected;
* A serious deterioration of the debtor's business results occurred or is expected;
* A change in the existing or anticipated technological market economic or legal environment which
will have a material adverse effect on the debtor's ability to repay the Group.According to the nature of financial instruments the Group evaluates whether credit risk increases
significantly on the basis of individual f inancial instruments or a combination of financial instruments.When assessing on the basis of a portfolio of financial instruments the Group may classify financial
instruments based on common credit risk characterist ics such as overdue information and credit risk
rating.If overdue for more than 30 days the Group determines that the credit risk of the financial instrument
has increased significantly.The Group believes that the financial assets are in default under the following circumstances:
* The Borrower is unlikely to pay its arrears to the Group in full and this assessment does not take
into account any recourse actions taken by the Group such as liquidating the collateral (if held); or
* Financial assets are more than 90 days overdue.A financial asset whose credit has been impaired
On the balance sheet date the Group evaluates whether credit impairment has occurred in financial
assets measured at amortized cost and debt investments measured at fair value and whose changes
are included in other comprehensive income. When one or more events which have an adverse effect
on 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:
* Major financial difficulties occur to the issuer or the debtor;
* A breach of contract by the debtor such as a default or late payment of interest or principal;
* The Group for economic or contractual considerations relating to the debtor's financial difficulties
gives concessions that the debtor would not have made under any other circumstances;
* The debtor is likely to go bankrupt or undergo other financial restructuring;
* The financial difficulties of the issuer or debtor result in the disappearance of an active market for
the financial asset.Presentation of expected credit loss provisions
In order to reflect the change of the credit risk of financial instruments since the initial recognition the
Group re-measures the expected credit loss on each balance sheet date and the increase or rolleback
amount of the loss provision thus formed shall be recorded into the current profit and loss as an
impairment loss or profit. For a financial asset measured at amortized cost the loss provision shall
offset the carrying value of the financial asset as stated in the balance sheet; For the debt investment
measured at fair value and its changes included in other comprehensive income the Group recognizes
93ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
its loss provision in other comprehensive income and does not deduct the book value of the financial
asset.Written-off
If the Group no longer reasonably expects that the contractual cash flow of a financial asset can be
recovered in whole or in part the carrying balance of the financial asset shall be directly written down.Such writedowns constitute termination recognition of the relevant financial assets. This usually occurs
when the Group determines that the debtor does not have assets or sources of income that generate
sufficient cash flow to repay the amount to be written down. However in accordance with the Group's
procedures for recovering amounts due the financial assets that have been written down may still be
affected by the execution activities.If a financial asset that has been written down is recovered later it shall be carried back as an
impairment loss and recorded in the profit and loss of the current period.
（6） Transfer of financial asset
Transfer of financial assets is the transfer or delivery of financial assets to another party (the transferee)
other than the issuer of financial assets.A financial asset is derecognised if the Group transfers substantial ly all the risks and rewards of
ownership of the financial asset to the transferee. A financial asset is not derecognised if the Group
retains substantially all the risks and rewards of ownership of the financial asset to the transferee.The Group neither transfers nor retains substantially all the risks and rewards of ownership of the
financial asset and the accounting treatment is shown as following: if the Group has forgone control
over the financial asset the financial assets is derecognized and new assets and liabilities are
recognized. If the Group retains control over the financial asset the financial asset is recognised to the
extent of its continuing involvement in the transferred financial asset and an associated liability is
recognised.
（7） Offset of financial assets and financial liabilities
Where the Group has the legal right to set off the recognized financial asset and financial liability and is
currently able to enforce such legal right and the Group plans to settle the financial asset on a net basis
or simultaneously realize the financial asset and pay off the financial liability the financial asset and
financial liability shall be shown in the balance sheet with the offset amount. In addition financial assets
and financial liabilities shall be separately presented in the balance sheet and shall not be set off
against each other.
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 Group 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 Group can normally
enter into a transaction on measurement date. The Group adopts the presumptions that would be used
by market participants in achieving the maximized economic value of the assets or liabilities.
94ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
For financial assets or financial liabilities with active markets the Group uses the quoted prices in active
markets as their fair value. Otherwise the Group 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 Group 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 Group 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 Group 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. Inventories
（1） Classification
The Group's inventory is classif ied by real estate development and non-real estate development.Inventory is mainly real estate development projects 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 include completed development
products and development products intended for sell but temporarily leased. Non-real estate
development projects include raw materials finished goods and engineering construction.
（2） Measurement method of cost of inventories
The group‘s inventories are measured at actual cost when acquired. The actual cost of developing a
product 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 actualcost is determined by specific identification method.Raw materials and finished goods are calculated using weighted average method.
（3） Basis for determining the net realizable value and method for provision for obsolete inventories
Net realizable 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
realizable 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 of inventories is recognised as a provision for
obsolete inventories and is recognised in profit or loss. The Group usually recognises provision for
95ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
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 prev iously
made is reversed.
（4） Inventory count system
The Group maintains a perpetual inventory system
（5） Amortization methods of low-value consumables and packaging materials
Low-value consumables are amortized at the point of use.
13. 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 Group has significant influence.
（1） Determination of initial investment cost
The init ial cost of a long-term equity investment acquired through a business combination involving
enterprises under common control is the Group‘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 Group 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 Group 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 Group‘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
init ial investment cost is less than the Group‘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 Group 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 Group. Changes in the Group‘s share of the investee‘s owners‘ equity other than
96ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
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 Group‘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 Group becomes capable of exercising joint control or significant influence (but not control)
over an investee due to additional investment or other reasons the Group 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 Group 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 sign ificant 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 Group can no longer exercise control over an investee due to new capital injection by other
investors and the Group can exercise joint control of or significant influence over an investee the
Group 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 Group adjusts
to the equity method using the new shareholding percentage as if it uses the equity method since it
obtains the investment.Unrealised profits and losses resulting from transactions between the Group and its associates or joint
ventures are eliminated to the extent of the Group‘s interest in the associates or joint ventures.Unrealised losses resulting from transactions between the Group and its associates or joint ventures are
eliminated in the same way as unrealised gains but only to the extent that there is no impairment.
（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 Group can exercise joint control over an investee the Group 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.
97ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Signif icant 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
Group can exercise significant influence over an investee the effect of potential voting rights (for
example warrants share options and convertible bonds) held by the Group or other parties that are
currently exercisable or convertible shall be considered.When the Group 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 Group cannot participate in the production and business
decisions of the investee and cannot form a significant influence. When the Group 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 Group 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 III. 20 for the Group‘s
method of asset impairment.
14. Assets held for sale and discontinued operations Long-term equity investments
(1) Classification and measurement of non-current assets or disposal groups held for sale
The Group classifies a non-current asset or disposal group as held for sale when the carrying amount of
the non-current asset or disposal group will be recovered through a sale transaction (including an
exchange transaction of non-monetary assets with commercial substance) rather than through
continuing use.Above mentioned non-current assets do not include investment properties subsequently measured with
the fair value model biological assets measured at fair value less costs to sell assets arising from
employee benefits financial assets deferred tax assets and contractual rights under insurance
contracts.The disposal group is a group of assets to be disposed of by sale or otherwise together as a whole in a
single transaction and liabilities directly associated with those assets that will be transferred in the
transaction. In certain circumstances disposal groups include goodwill acquired in a business
combination.A non-current asset or disposal group is classif ied as held for sale when all the following criteria are met:
According to the customary practices of selling such asset or disposal group in similar transactions the
non-current asset or disposal group is available for immediate sale in its present condit ion; The sale is
highly probable to occur that is the Group has made a resolution on a sale plan and entered into a
legally binding purchase agreement with other parties. The sale is expected to be completed within one
year. The Group that is committed to a sale plan involving loss of control of a subsidiary classifies all the
investment in that subsidiary as held for sale in its separate financial statements and classifies all the
assets and liabilit ies of that subsidiary as held for sale in its consolidated financial statements when the
classification criteria for held for sale are met regardless of whether the Group retains a non-controlling
interest in its former subsidiary after the sale.Non-current assets or disposal groups held for sale are init ially and subsequently measured at the lower
of carrying amount and fair value less costs to sell. Any excess of the carrying amount over the fair
98ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
value less costs to sell is recognised as an impairment loss in profit or loss. The impairment loss
recognised for a disposal group firstly reduces the carrying amount of goodwill allocated to the disposal
group and then reduces the carrying amount of other non-current assets pro rata on the basis of the
carrying amount of each non-current asset in the disposal group.The Group recognises a gain for any subsequent increase in fair value less costs to sell of an asset but
not in excess of the cumulative impairment loss that has been recognised after classified as held for
sale. The reduced carrying amount of goodwill is not recovered.The Group does not depreciate (or amortise) a non-current asset while it is classified as held for sale or
while it is part of a disposal group classified as held for sale. Interest and other expenses attributable to
the liabilities of a disposal group classif ied as held for sale continue to be recognised. If an investment
or a part of investment in an associate or a joint venture is classified as held for sale equity method is
not used for the part classified as held for sale while equity method is used for the rest part (the part not
classified as held for sale) continuely. When the Group does not have material impact on an associate
or a joint venture due to the sale transaction it stops using equity method.The Group measures a non-current asset that ceases to be classified as held for sale at the lower of:
* its carrying amount before the asset or disposal group was classified as held for sale adjusted
for any depreciation amortisation or impairment that would have been recognised had the asset or
disposal group not been classified as held for sale.* its recoverable amount.
(2) Discontinued operations
The Group classifies a component as a discontinued operation either upon disposal of the operation or
when the operation meets the criteria to be classified as held for sale if it is separately identifiable and
satisfies one of the following conditions:
* It represents a separate major line of business or a separate geographical area of operations;
* It is part of a single co-ordinated plan to dispose of a separate major line of business or a separate
geographical area of operations;
* It is a subsidiary acquired exclusively with a view to resale.
(3) Presentation
The Group presents a non-current asset classified as held for sale and the assets of a disposal group
classified as held for sale as ―Assets held for sale‖ in balance sheet. The liabilities of a disposal group
classified as held for sale is presented as ―Liabilities held for sale‖ in balance sheet.The Group presents profit or loss from discontinued operations separately from profit or loss from
continuing operations in income statement. Impairment loss and reversal amount and any disposal gain
or loss of a non-current asset or disposal group classified as held for sale that does not meet the
definition of a discontinued operation is included in profit or loss from continuing operations. Any gain or
loss from continuing operation of discontinued operations including impairment loss and reversal
amount and disposal gain or loss is included in profit or loss from discontinued operations.
99ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
A disposal group which is planned to cease operation rather than for sale and meets the criteria of a
part of discontinued operation the Group presents it as discontinued operation from the date of
cessation.Where an operation is classif ied as discontinued in the current period profit or loss from continuing
operations and profit or loss from discontinued operations are separately presented in the income
statement for the current period. If the Group ceases to classify a discontinued operation as held for
sale the information previously presented in discontinued operations is reclassified and included in
income from continuing operations for all periods presented.
15. Investment property
Investment properties are properties held either to earn rental income or for capital appreciation or for
both. The Group‘s investment properties include leased houses leased buildings 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 III.20.The balance of the disposal income from the sale transfer scrapping or damage of the investment real
estate after deducting its book value and relevant taxes and fees shall be recorded into the current profit
and loss.
16. Fixed assets
（1） Recognition of fixed assets
Fixed assets represent the tangible assets held by the Group 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 Group and
its cost can be reliably measured.Fixed asset are initially measured at cost.Subsequent expenses related to fixed assets shall be recorded into cost of fixed assets when its related
economic benefits are likely to flow to the Group and its cost can be reliably measured; the cost of daily
repairs to fixed assets that do not meet the conditions for subsequent expenditures for capitalization of
fixed assets at the time of occurrence shall be recorded into the profit or loss of the current period or
the cost of the related assets. For the part that is replaced its carrying amount is derecognized
（2） Depreciation of fixed assets
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:
100ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Estimated useful life Residual value
Class Depreciation rate %（years） rate %
Plant and buildings 30 5 3.17
Motor vehicles 6 5 15.83
Electronic equipment and others 5 5 19.00
For impaired fixed assets cumulative amount of impairment provision is deducted in determinating the
depreciation rate.
(3) For the impairment of the fixed assets please refer to Note III.20.
(4) Useful lives estimated residual values and depreciation methods are reviewed at least at each year-
end.The Group 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.
(5) Disposal of fixed asset
When a fixed asset is disposed of or when it is expected that no economic benefit will be generated
through the use or disposal the fixed asset shall be derecognised. Proceeds from the disposal of fixed
assets sold transferred scrapped or damaged net of their carrying amount and associated taxes shall
be recorded in the profit or loss for the current period.
17. Construction in progress
Construction in progress is recognized based on the actual construction cost including all expenditures
incurred for construction Items capitalised 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.For the impairment of construction in progress please refer to Note III.20.
18. 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:
* capital expenditures have been incurred including expenditures that have resulted in payment of
cash transfer of other assets or the assumption of interest-bearing liabilities;
* borrowing costs have been incurred;
* the activities that are necessary to prepare the asset for its intended use or sale have commenced.
101ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
（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 Group borrows funds
generally and uses them for the purpose of obtaining a qualifying asset the Group 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 Group 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.
19. Intangible assets
Intangible assets include software 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 f inite amortisation method shall ref lect 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 Group 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.For the impairment of intangible assets please refer to Note III.20.
20. 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:
102ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
At each balance sheet date the Group determines whether there is any indication of impairment. If any
indication exists the recoverable amount of the asset is estimated. In addition the Group 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 Group 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
its 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 Group.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 its 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.
21. 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 Group recognized its amortised cost in profit or loss for the current period.
22. Employee benefits
(1) Scope of employee benefits
Employee benefits refer to all forms of consideration or compensation given by the Group in exchange
for service rendered by employees or for 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 Group‘s spouse children dependents family
members of deceased employees or other beneficiaries are also part of the employee benefits.According to liquidity employee benefits are presented as ―employee benefits payable‖ and ―long-term
employee benefits payable‖ on the balance sheet.
(2) Short-term employee benefits
103ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
In the current period the Group 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.
(3) 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 and
corporate pension plan etc.Besides basic pension insurance the Group establishes corporate pension plans in accordance with the
related policies of corporate pension regulations. Employees can join the pension plan voluntarily. The
Group has no other significant commitment of employees‘ social security.The Group 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 plans
For a defined benefit plan an actuarial valuation is performed by an independent actuary at the annual
balance sheet date to determine the cost of providing benefits using the expected accrued benefit unit
method. The employee compensation cost caused by the benefit plan of the Group includes the
following components:
* Service cost including current service cost past service cost and settlement profit or loss. Including
the current service cost refers to the increase in the present value of the defined benefit plan obligation
caused by the current provision of services by employees; The past service cost refers to the increase
or decrease in the present value of the defined benefit plan obligations related to the employee services
of the previous period as a result of the modification of the defined benefit plan.* Set the net interest on the net liabilities or net assets of the benefit plan including the interest
income on the plan assets the interest expense on the defined benefit plan obligations and the interest
on the impact of the asset cap.* The changes caused by the remeasurement of the net liabilities or net assets of the benefit plan.Unless other accounting standards require or allow the cost of employee benefits to be included in the
cost of assets the Group will include items * and * above in the current profit and loss; Item *
is included in other comprehensive income and will not be turned back to profit and loss in subsequent
accounting periods. When the originally defined benefit plan is terminated the part originally included in
other comprehensive income within the scope of equity is carried forward to undistributed profit.
104ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
(4) Termination benefits
The Group provides for termination benefits to the employees and shall recognise 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 Group cannot unilaterally withdraw the offer of the
termination benefits because of an employment termination plan or a redundancy proposal; or when the
Group recognises the costs or expenses relating to a restructuring that involves the payment of the
termination benefits.For employees who implement the internal retirement plan the economic compensation before the
official retirement date belongs to dismiss welfare. During the normal retirement date when the
employees stop providing services the salary and social insurance premium to be paid by the
employees who retire within the Group shall be included in the profit and loss of the current period in a
lump sum. Economic compensation after the official retirement date (such as the normal pension) shall
be treated as after-service benefits.
(5) Other long-term employee benefits
Other long-term employee benefits provided by the Group 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 satisf ied 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 defined benefit plan shall be
recorded in profit or loss for the current period or cost of relevant assets.
23. Provisions
A provision is recognised for an obligation related to a contingency if all the following condit ions are
satisfied:
(1) the Group has a present obligation;
(2) it is probable that an outflow of economic benefits will be required to settle the obligation; and
(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 Group 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.
24. Revenue
(1) General principles
105ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
The Group has fulfilled its contractual obligation to recognize revenue when the customer acquires
control of the relevant goods or services.If the contract contains two or more performance obligations the Group shall on the commencement
date of the contract allocate the transaction price to each single performance obligation according to
the relative proportion of the individual selling price of the commodity or service committed by each
single performance obligation and measure the income according to the transaction price allocated to
each single performance obligation.If one of the following conditions is satisfied the Group shall perform its obligations within a certain
period of time; otherwise it belongs to the performance obligation at a certain point:
* The Client obtains and consumes the economic benefits brought by the Group's performance at the
same time of the Group's performance.* The customer can control the goods under construction during the performance of the Group.* The commodities produced by the Group during the performance of the Contract have irreplaceable
purposes and the Group has the right to collect payment for the accumulated part of the performance
completed so far during the whole period of the Contract.For the performance obligations performed within a certain period of time the Group shall recognize the
income in accordance with the performance progress within that period. If the performance progress
cannot be reasonably determined and the Group is expected to be compensated for the costs already
incurred the revenue shall be recognized according to the amount of the costs already incurred until the
performance progress can be reasonably determined.For performance obligations performed at a certain point the Group recognizes revenue at the point
when the customer acquires control of the relevant goods or services. In determining whether a
customer has acquired control of goods or services the Group will take into account the following
indications:
* The Group has a current right to receive payment for the goods or services that is the Customer
has a current obligation to pay for the goods.* The Group has transferred the legal ownership of the commodity to the customer that is the
customer has the legal ownership of the commodity.* The Group has transferred the goods in kind to the customer that is the customer has physical
possession of the goods.The Group has transferred the main risks and rewards on the ownership of the commodity to the
customer that is the customer has acquired the main risks and rewards on the ownership of the
commodity.* The customer has accepted the goods or services.* Other indications that the customer has acquired control of the product.The Group's right to receive consideration for goods or services transferred to a customer (and this right
depends on other factors other than the passage of time) is a contract asset which is subject to
106ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
impairment on the basis of expected credit losses (see Note III 10 (5)). The Group's right unconditional
(depending only on the passage of time) to collect consideration from customers is shown as a
receivable. The Group's obligation to transfer goods or services to customers for which it has received
or receivable consideration is a contractual liability.The contract assets and contract liabilities under the same contract shall be presented on a net basis. If
the net amount is the debit balance it shall be presented under the item of "Contract Assets" or "Other
Non-current Assets" according to its liquidity; If the net amount is a credit balance it shall be shown
under the item "Contract Liabilities" or "Other Non-current Liabilities" according to its liquidity.
（2）Specific methods
The specific methods of the Group's revenue recognition are as follows:
* The method for recognizing revenue from property sales
(1) the sale contract has been signed and filed with housing construction bureau; (2) the property
development is completed and pass the acceptance; (3) For Lump-sum payment revenue is recognized
by the group when the consideration is fully received. For instalment payment revenue is recognized
when 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 sale contract.* The method for recognizing revenue from property services provided
According to property service contract agreed service period area served and unit price revenue is
recognized evenly within agreed service period.* The method for recognizing revenue from construction activities
As the customer can control the goods under construction during the performance of the Group the
group shall recognize the income in accordance with the performance progress within a certain period
of time (except for performance progress cannot be reasonably determined). The group shall determine
the performance progress based on cost incurred. If the performance progress cannot be reasonably
determined and the Group is expected to be compensated for the costs already incurred the revenue
shall be recognized according to the amount of the costs already incurred until the performance
progress can be reasonably determined. If the contract costs cannot be recovered the cost should be
recognized immediately in current period when incurred. When the estimated total cost of the contract is
likely to exceed the total revenue of the contract the cost of the main business and the estimated
liabilit ies shall be recognized in accordance with the unexecuted loss contract. The loss shall be
recognized as current cost and put into provisions.* The method for recognizing revenue from other income
Revenue from other income include income from hotel operations etc. Rooms revenue from hotel
operations shall be recognized in accordance with the performance progress within agreed period as
the client obtains and consumes the economic benefits brought by the Group‘s performance and the
group‘s performance obligations has performed at a certain period of time. For other income the group
recognizes revenue at the point when the customer acquires control of the relevant goods or services
which indicate the group has a right to receive payment for services or goods provided in accordance
with the relevant contract.
107ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
25. Contract costs
Contract costs include incremental costs incurred to obtain the contract and contract performance costs.Incremental costs incurred to obtain a contract are costs (such as sales commissions etc.) that the
Group would not have incurred without the contract. If the cost is expected to be recovered the Group
will recognize it as an asset as the contract acquisition cost. Other expenses incurred by the Group for
the acquisit ion of contracts other than the incremental costs expected to be recovered are recorded
into the profit and loss of the current period when incurred.If the cost incurred for the performance of the contract does not fall within the scope of accounting
standards for inventories and other enterprises and meets the following conditions at the same time the
Group will recognize it as an asset as the contract performance cost:
* The costs are directly related to a current or prospective contract and include direct labor direct
materials overhead (or similar) costs that are expressly borne by the customer and other costs
incurred solely in connection with the contract;
* This cost increases the Group's future resources for fulfilling its performance obligations;
* The cost is expected to be recovered.Assets with contract acquisit ion cost recognition and assets with contract performance cost recognition
(hereinafter referred to as "assets related to contract cost") shall be amortized on the same basis as
income recognition of goods or services related to such assets and shall be recorded into current profit
and loss. If the amortization period does not exceed one year it will be recorded in the current profit and
loss at the time of occurrence.When the book value of the assets related to the contract cost is higher than the difference between the
following two items the Group shall make provision for impairment of the excess part and recognize it
as impairment loss of the assets:
* the remaining consideration that the Group is expected to obtain as a result of the transfer of the
goods or services related to the asset;
* Estimate the costs to be incurred for the transfer of the relevant goods or services.The contract performance cost recognized as an asset shall be shown in the "Inventory" item with an
amortization period of no more than one year or one normal operating cycle at the time of initial
recognition while the amortization period exceeding one year or one normal operating cycle at the time
of initial recognition shall be shown in the item of "Other Non-current Assets".The contract acquisition cost recognized as an asset shall be shown in the item of "Other Current
Assets" with an amortization period of less than one year or one normal operating cycle at the time of
init ial recognition and shall be shown in the item of "Other Non-current Assets" with an amortization
period of more than one year or one normal operating cycle at the time of initial recognition.
26. 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.
108ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
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
CNY 1.Government grants related to assets are grants whose primary condition is that the Group qualifying for
them should purchase construct or otherwise acquire long-term assets. Government grants related to
income are grants other than those related to assets.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. The Group applies a consistent approach to same or similar
government grant transactions.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 amout 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.
27. 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);
109ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
(2) taxable temporary differences associated with investments in subsidiaries associates and joint
ventures and the Group 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 Group 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.
28. Leases
(1) Identification of leases
On the commencement date of the contract the Group as lessee or lessor assesses whether the
customer under the contract is entitled to receive almost all the economic benefits arising from the use
of the identified assets during the use period and to direct the use of the identified assets during the use
period.The Group considers the contract to be a lease or an inclusive lease if one of the parties to the
contract relinquishes control over the use of one or more identified assets for a certain period of time in
exchange for consideration.
(2) The Group acts as the lessee
On the commencement date of the lease the Group recognizes the right-of-use assets and lease
liabilities for all leases except for simplified short-term leases and leases of low value assets.For the accounting policy of the Right-of-use assets see Note III.29.Lease liabilities are initially measured at the present value of the outstanding lease payments at the
commencement date of the lease at the embedded interest rate on the lease. The rental payment
amount includes: fixed payment amount and substantial fixed payment amount. If there is lease
incentive amount the relevant amount of lease incentive amount will be deducted. Variable lease
payments depending on an index or ratio; The exercise price of the Option provided that the Lessee is
reasonably certain that the Option will be exercised; The amount to be paid to exercise the option to
terminate the lease if the lease term reflects that the lessee will exercise the option to terminate the
110ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
lease; And the amount expected to be payable based on the residual value of the security provided by
the Lessee. The interest expense of the lease liability in each period of the lease term shall be
calculated in accordance with the fixed periodic interest rate and recorded into the profit and loss of the
current period. The variable lease payment not included in the measurement of lease liabilit ies shall be
recorded into the current profit and loss when actually incurred.Short term lease
Short-term tenancy is a tenancy for a period of not more than 12 months at the commencement date of
the tenancy except for tenancies that include a purchase option.The Group will record the lease payment amount of short-term lease into the cost of relevant assets or
current profit and loss in each period of the lease term according to the straight-line method [or other
systemically reasonable method].For short-term lease the Group chooses to adopt the above simplified treatment method for the items
that meet the short-term lease conditions in the following asset types according to the categories of
leased assets.Low value asset leasing
Leasing of low-value assets refers to the leasing of a single leased asset whose value is less than CNY
40000.00 when it is a brand-new asset.
The Group will include the lease payment of the low-value asset lease into the cost of the relevant asset
or current profit and loss in each period of the lease term according to the straight-line method.For low-value asset leases the Group chooses to adopt the above simplified treatment method
according to the specific situation of each lease.Change of Lease
If the lease is changed and the following conditions are met at the same time the group accounts for
the change as a separate lease: 1 the change extends the scope of the lease by adding the right to use
one or more leased assets; 2 the increased consideration is equivalent to the amount of the individual
price of the extended portion of the lease adjusted in accordance with the circumstances of the contract.If the lease change is not accounted for as a separate lease on the effective date of the lease change
the company redistributes the consideration of the contract after the change and redetermines the lease
term the lease liability is recalculated at the present value of the changed lease payment and the
revised discount rate.If the lease scope is reduced or the lease period is shortened as a result of the lease change the
company shall adjust the book value of the right-to-use assets accordingly and record the relevant
gains or losses related to the partial or complete termination of the lease in the current profit and loss.If other lease changes result in lease liabilities being re-measured the company shall adjust the book
value of the right-to-use assets accordingly.
111ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
(3) The Group acts as the lessor
When the Group acts as the lessor the leases that substantially transfer all the risks and rewards
related to the ownership of the assets are recognized as financial leases and other leases other than
financial leases are recognized as operating leases.Finance lease
In the case of financial leasing the Group takes the net lease investment as the book value of the
receivable finance lease funds at the beginning of the lease period and the net lease investment is the
sum of the unguaranteed residual value and the present value of the unreceived lease income at the
beginning of the lease period discounted at the embodied interest rate.The Group as the lessor
calculates and recognizes interest income for each period of the lease term at a fixed periodic rate.The
variable lease payment obtained by the Group as the lessor and not included in the measurement of the
net lease investment shall be recorded into the current profit and loss when actually incurred.The termination recognition and impairment of financial lease receivable shall be accounted for in
accordance with the provisions of the Accounting Standards for Business Enterprises No. 22 -
Recognition and Measurement of Financial Instruments and the Accounting Standards for Business
Enterprises No. 23 - Transfer of Financial Assets.Operating lease
For the rent in the operating lease the Group shall recognize the profits and losses of the current period
in accordance with the straight-line method during each period of the lease term. The initial direct
expenses incurred in connection with the operating lease shall be capitalized allocated on the same
basis as the recognition of rental income during the lease term and recorded into the current profit and
loss in installments. The variable lease payments obtained in connection with the operating lease and
not included in the lease receipts shall be recorded into the current profit and loss when actually
incurred.Change of Lease
If there is a change in the operating lease the group shall as of the effective date of the change treat it
as a new lease the amount received in advance or in respect of the lease receivable relating to the
lease prior to the change shall be deemed to be the amount received for the new lease.If the financial lease is changed and the following conditions are met at the same time the group
accounts for the change as a separate lease: 1 the change extends the scope of the lease by adding
the right to use one or more leased assets; 2 the increased consideration is equivalent to the amount of
the individual price of the extended portion of the lease adjusted in accordance with the circumstances
of the contract.Where a change in a financial lease is not accounted for as a separate lease the group shall treat the
changed lease as follows: 1 if the change becomes effective on the lease commencement date if the
lease will be classified as an operating lease the group will treat it as a new lease from the effective
date of the lease change the book value of the leased asset shall be the net investment in the lease
prior to the effective date of the lease change. 2 if the change takes effect on the effective date of the
lease the lease will be classified as a financial lease the accounting treatment of the group is in
accordance with the provisions of the "Accounting Standards for enterprises No. 22-recognition and
measurement of financial instruments" concerning modification or renegotiation of contracts.
112ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
29. Right-of-use assets
(1) Conditions for the confirmation of the right-of-use assets
The Group's right-of-use assets refer to the Group's right to use the leased assets during the lease term
as the lessee.On the beginning date of the lease period the right-of-use assets shall be initially measured at cost. The
cost includes: the initial measurement amount of the lease liability; For the amount of lease payment
paid on or before the commencement date of the lease term if there is a lease incentive the relevant
amount of lease incentive already enjoyed will be deducted; Initial direct expenses incurred by the
Group as the lessee; The costs which the Group as the Lessee expects to incur in dismantling and
removing the Leased Assets restoring the premises on which the Leased Assets are located or
restoring the Leased Assets to the state agreed in the Lease Terms. The Group as the lessee shall
confirm and measure the costs of demolition and restoration in accordance with the Accounting
Standards for Business Enterprises No. 13 - Contingencies. Subsequent adjustments are made for any
remeasurement of lease liabilities.
(2) Depreciation method of the right-of-use assets
The Group uses the straight line method of depreciation. Where the Group as the lessee can
reasonably determine that it obtains the ownership of the leased assets upon expiration of the lease
term depreciation shall be accrued over the remaining service life of the leased assets. Where it is
impossible to reasonably determine that the ownership of the leased asset can be acquired at the
expiration of the lease term depreciation shall be accrued in the shorter period between the lease term
and the remaining useful life of the leased asset.
(3) See Note III.20 for the impairment test method of the right-of-use assets and the provision for
impairment.
30. Maintenance Fund
When the Group collects the maintenance fund from the owners according to a certain proportion of the
sales amount of commercial houses it shall be included in other payables for accounting; When the
collected maintenance funds are handed over to the land and housing administrative departments in
accordance with the regulations the maintenance funds collected on behalf of them shall be reduced.
31. Quality Deposit
The Group shall keep the quality deposit in proportion to the payment period stipulated in the contract of
civil engineering and installation engineering and deduct it from the civil engineering and installation
Item payment which shall be classified as other payables. The maintenance expenses incurred due to
quality during the warranty period shall be directly charged under this item and liquidated after the
warranty period.
32. Accounting judgments and estimates
The Group conducts an ongoing evaluation of the significant accounting estimates and key assumptions
used in the light of historical experience and other factors including reasonable expectations of future
events. Important accounting estimates and key assumptions that are likely to result in the risk of a
material adjustment in the carrying value of assets and liabilities during the next fiscal year are set out
below:
113ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Classification of financial assets
The Group's major judgments in determining the classification of financial assets include the analysis of
business models and contractual cash flow characteristics.The Group determines the business model for the management of financial assets at the level of its
financial portfolio taking into account factors such as the way in which the performance of financial
assets is evaluated and reported to key managers the risks affecting the perform ance of financial
assets and their management methods and the way in which managers of related businesses are
remunerated.When evaluating whether the contractual cash flow of financial assets is consistent with the basic
lending arrangement the Group has the following main judgments: whether the time distribution or
amount of the principal in the duration period may change due to reasons such as prepayment; Does
interest include only the time value of money credit risk other fundamental borrowing risks and
consideration for costs and profits? For example does the prepayment amount only reflect the
outstanding principal and interest based on the outstanding principal and reasonable compensation for
early termination of the contract.Measurement of expected credit losses in accounts receivable
The Group calculates the expected credit loss of accounts receivable through the default risk exposure
of accounts receivable and the expected credit loss rate and determines the expected credit loss rate
based on the default probability and the default loss rate. In determining the expected credit loss rate
the Group uses data such as internal historical credit loss experience and adjusts the historical data in
combination with the current situation and forward-looking information. When considering forward-
looking information the indicators used by the Group include the risk of an economic downturn
changes in the external market environment the technological environment and customer conditions.The Group regularly monitors and reviews assumptions relating to the calculation of expected credit
losses.Deferred tax assets
Deferred tax assets should be recognized for all unutilized tax losses to the extent that there is likely to
be sufficient taxable profit to offset the loss. This requires management to use a great deal of judgment
to estimate when and how much future taxable profits will occur in combination with tax planning
strategies to determine the amount of deferred tax assets that should be recognized.The provision of land appreciation tax
The Group is subject to land appreciation tax (―LAT‖ ). The accrual of LAT is subject to management‘s
estimation which is made based on its understanding of the requirements of relevant tax laws and
regulations. However the actual LAT is levied by tax authorities according to the interpretation of the tax
rules. The group is not stepping on formulating the final tax plan with relevant tax authorities hence the
final tax outcome could be different from the amount that was initially recorded and these differences
will have an impact on tax provision in current period.Determination of fair value of unlisted equity investments
The fair value of an unlisted equity investment is the estimated future cash flows discounted at the
current discount rate for Items with similar terms and risk characteristics. This valuation requires the
Group to estimate expected future cash flows and the discount rate and is therefore subject to
114ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
uncertainty. In limited circumstances if the information used to determine the fair value is insufficient or
if the possible estimates of the fair value are spread over a wide range and the cost represents the best
estimate of the fair value within that range the cost may represent the appropriate estimate of the fair
value within that range.
33. Changes in significant accounting policies and accounting estimates
(1) Significant changes in accounting policies
* Interpretation of Accounting Standards for Business Enterprises No. 15
The Ministry of Finance issued the Interpretation of Accounting Standards for Business Enterprises No.
15 (Finance and Accounting [2021] No. 35) (hereinafter referred to as "Interpretation No. 15") in
December 2021.According to Interpretation No. 15 if an enterprise sells its fixed assets to the outside world (hereinafter
referred to as trial operation sales) before the fixed assets reach the scheduled usable state or the
products or by-products produced in the course of research and development in accordance with the
provisions of accounting standards for Enterprises No. 14-income and Accounting Standards for
enterprises No. 1-inventory the revenue and costs related to the trial sales shall be accounted for
separately after accounting for the current profit and loss the net amount of the revenue related to the
trial run sales after offsetting the relevant costs shall not be offset against the cost of fixed assets or R &
D expenses. The relevant products or by-products of the trial operation output shall be recognized as
inventory if they comply with the provisions of the accounting standards for enterprises No. 1-inventory
before they are sold abroad the relevant assets shall be recognized as those that meet the
requirements for the recognition of the relevant assets in other relevant enterprise accounting standards.* Interpretation of Accounting Standards for Business Enterprises No. 16
The Ministry of Finance issued the Interpretation of Accounting Standards for Business Enterprises No.
16 (Finance and Accounting [2022] No. 31) (hereinafter referred to as "Interpretation No. 16") in
November 2022.According to Interpretation No. 16 for financial instruments such as perpetual debt classified as equity
instruments an enterprise shall recognize the income tax effects related to dividends when recognizing
dividends payable. The income tax effect of the dividend shall be included in the profit and loss of the
current period for the distribution of profits derived from previous transactions or events that generate
profits and losses; The income tax effect of a dividend derived from a transaction or event previously
recognized in an owner's equity shall be included in the owner's equity item.The Group's financial instruments classif ied as equity instruments recognized dividends payable in the
current year involving income tax effects in accordance with the above-mentioned Interpretation No. 16
accounting treatment retroactive adjustment of income tax effects in respect of financial instruments
that occurred prior to 1 January 2022 and that had not been terminated on 1 January 2022.Interpretation No. 16 stipulates that if an enterprise modifies the terms and conditions in the agreement
on share payment settled in cash to make it pay in shares settled in equity on the date of revision an
enterprise shall in accordance with the fair value of the equity instrument granted on the date of its
award account for the acquired services as part of the capital reserve at the same time shares that are
recognized for cash settlement are terminated for payment of liabilities recognized at the date of
115ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
modification and the difference between the two is included in the current profit and loss. If the waiting
period is extended or shortened due to the modification the enterprise shall carry out the above-
mentioned accounting treatment according to the modified waiting period (without consider ing the
relevant accounting treatment provisions of the adverse modification) .The cash-settled share payments in the current year of the Group shall be changed to equity -settled
share payments and shall be handled in accordance with the above-mentioned Interpretation no. 16
for transactions of this type that occurred prior to 1 January 2022 retained earnings and other related
financial statement items as at 1 January 2022 are not adjusted for information for comparable periods.The adoption of Interpretation no. 16 has not had a significant impact on the company's financial
position and operating results.
(2) Changes in significant accounting estimates
During reporting period there is no changes in significant accounting estimate.IV. Taxation
1. Main types of taxes and corresponding tax rates
Tax Type Tax Basis Tax Rate%
VAT Taxable income 9/6/5/3
It shall be levied on the basis of the Four progressive rates
Land appreciation tax
added value of the real estate transferred of excess rate: 304050 60
Property tax 70% of the original value of properties 1.2
City maintenance and construction
Turnover tax payable 7
tax
Education surcharge Turnover tax payable 3
Local education surcharge Turnover tax payable 2
Corporate income tax Taxable profits 25/ 16.5
Explanation for the VAT rate of different business activities:
With regards to revenue from property development property management and construction activities
from May 1st 2016 the group‘s taxable items and tax rates are shown in the following table which inaccordance with the relevant regulations of《Notice on Comprehensively Promoting the Trial ofReplacing Business Tax with Value-Added Tax》(No. 36 of CaiKuai [2016]):
Taxable income Means to calculate Tax Tax Rate%
Revenue from property sales Simplified Tax Method 5
Revenue from construction Simplified Tax Method 9/ 3
Rental income Simplified Tax Method 5
Revenue from property management General Tax Method 6
Explanation of corporate income tax rates for different taxpayers:
The corporate income tax rate for companies registered in mainland China is 25% while the corporate
profits tax rate for companies registered in Hong Kong is 16.5%.
116ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
2. Tax preferential treatments and approval documents
Subsidiaries of the Group Shenzhen Huazhan Construction Supervision Co. Ltd. and Shantou Special
Economic Zone Xiangshan Real Estate Development Co. Ltd. are applicable to the preferential tax rate
of 20% for small and low-profit enterprises.V. Notes to the consolidated financial statements
1. Cash at bank and Cash Equivalent
Item 2022.12.31 2021.12.31
Cash in hand 4549.61 12082.00
Deposits with banks 163083275.13 316834778.45
Other monetary funds 34576125.00 247511964.18
Total 197663949.74 564358824.63
Including: Total overseas deposits 5840173.03 5970125.18
At the end of year 2022 there were CNY 7298880.26 of restricted funds in the bank deposits of which
CNY 48315.48 were the funds frozen by the lawsuit and CNY 5674439.78 were the funds for the
construction of public facilities in and around the city of Longgang district.At the end of year 2022 the balance of other monetary funds of CNY 34576125.00 is seven-day notice
deposit including principal of CNY 33000000.00 and interest of CNY 1576125.00.
2. Trading financial assets
Item 2022.12.31 2021.12.31
Financial Fund 408154361.42 514024710.91
3. Notes receivable
2022.12.312021.12.31
Types of
notes Book Bad debt Book Bad debt Book value Book value
balance provision balance provision
Banker
acceptance -- -- -- -- -- --
notes
Commercial
acceptance 1617000.00 80850.00 1536150.00 6394766.22 2864228.85 3530537.37
notes
Total 1617000.00 80850.00 1536150.00 6394766.22 2864228.85 3530537.37
Note:
(1) There is no notes receivable pledged by the Group at the end of the period
(2) Outstanding endorsed or discounted notes that have not matured at the end of the year
Derecognized Amount at the end Amount that is not derecognized
Types
of the period at the end of the period
Banker acceptance notes -- --
Commercial acceptance notes -- 1617000.00
Total -- 1617000.00
117ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
(3) Notes receivable transferred to accounts receivable by the Group due to the drawer's non-
performance at the end of the period
Types Amount transferred to accounts receivable at the end of the period
Commercial acceptance notes 11789376.23
(4) Classified by bad debt provision method
2022.12.31
Types Book balance Bad debt provision
Percentage Expected credit Book balance
Amount Amount
(%) loss rate (%)
Bad debt provisions made on
----------
an individual basis
Bad debt provisions made on
1617000.00100.0080850.005.001536150.00
a combination basis
Including
Banker acceptance notes 1617000.00 100.00 80850.00 5.00 1536150.00
Commercial acceptance
----------
notes
Total 1617000.00 100.00 80850.00 5.00 1536150.00
Continued:
2021.12.31
Types Book balance Bad debt provision Book
Percentage Expected credit
Amount Amount balance
(%) loss rate (%)
Bad debt provisions made on
4626346.4472.352775807.8660.001850538.58
an individual basis
Bad debt provisions made on
1768419.7827.6588420.995.001679998.79
a combination basis
Including:
Banker acceptance notes -- -- -- -- --
Commercial
1768419.7827.6588420.995.001679998.79
acceptance notes
合计6394766.22100.002864228.8544.793530537.37
Note：
Bad debt provision made on an individual basis：
2022.12.31
Item Bad debt Expected credit
Book balance Reason
provision loss rate (%)
Shenzhen Hongteng Investment
------
Management Co. Ltd.
118ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Continued:
2021.12.31
Item Bad debt Expected credit
Book balance Reason provision loss rate (%)
Shenzhen Hongteng Low recoverability is
Investment Management 4626346.44 2775807.86 60.00
expected
Co. Ltd.Bad debt provision made on a combination basis:
Combined withdrawal item: commercial acceptance notes
2022.12.312021.12.31
Item Expected Expected Notes Bad debt Notes Bad debt
credit loss credit loss
receivable provision receivable provision
rate (%) rate (%)
Within one
1617000.0080850.005.001768419.7888420.995.00
year
(5) Additions recoveries or reversals of provision for the current period
Bad debt provision
2021.12.312864228.85
Additions --
Recoveries or reversals 2783378.85
Written-off --
2022.12.3180850.00
4. Accounts receivable
(1) Disclosure by Aging
Aging 2022.12.31 2021.12.31
Within 1 year 64697535.13 67970511.50
1 to 2 year 8701822.68 290567.01
2 to 3 years 290567.01 --
More than 3 years 23918937.08 23975620.75
Subtotal 97608861.90 92236699.26
Less: Bad Debt Provision 34028439.74 31187914.15
Total 63580422.16 61048785.11
119ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
(2) Classified by bad debt provision method
2022.12.31
Types Book balance Bad debt provision
Percentage Expected credit Book value
Amount Amount
(%) loss rate (%)
Bad debt provisions made on
36722640.7337.6232006890.2487.164715750.49
an individual basis
Bad debt provisions made on
60886221.1762.382021549.503.3258864671.67
a combination basis
Including: -- -- -- -- --
Receivable from property
sales
Receivable from other 62.38 2021549.50 3.32 5886467167
corporate customers 60886221.17
Total 97608861.90 100.00 34028439.74 34.86 63580422.16
Continued:
2021.12.31
Types Book balance Bad debt provision
Percentage Expected credit Book value
Amount Amount
(%) loss rate (%)
Bad debt provisions made on
32550436.9335.2929212403.3789.753338033.56
an individual basis
Bad debt provisions made on
59686262.3364.711975510.783.3157710751.55
a combination basis
Including: -- -- -- -- --
Receivable from property
1064220.181.1553211.015.001011009.17
sales s
Receivable from other
58622042.1563.561922299.773.2856699742.38
corporate customers s
Total 92236699.26 100.00 31187914.15 33.81 61048785.11
Bad debt provision made on an individual basis:
2022.12.31
Item Bad debt Expected credit
Book balance Reason
provision loss rate (%)
Agent for import and export Could be
11574556.0011574556.00100.00
business payment uncollectible
Long-term receivable of property Could be
10020587.9110020587.91100.00
sale uncollectible
Shenzhen Hongteng Investment recoverability is
11789376.237073625.7460.00
Management Co. Ltd. relatively small
Receivable from revoked Could be
2328158.402328158.40100.00
subsidiaries uncollectible
Could be
Receivable from other customers 1009962.19 1009962.19 100.00
uncollectible
Total 36722640.73 32006890.24 87.16
120ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Continued:
2021.12.31
Item Book Bad debt Expected credit
Reason
balance provision loss rate (%)
Agent for import and export Could be
11574556.0011574556.00100.00
business payment uncollectible
Long-term receivable of property Could be
9649415.209649415.20100.00
sale uncollectible
Shenzhen Hongteng Investment
8345083.91 5007050.35 60.00 Low recyclability
Management Co. Ltd.Receivable from revoked Could be
2328158.402328158.40100.00
subsidiaries uncollectible
Could be
Other customer payments 653223.42 653223.42 100.00
uncollectible
Total 32550436.93 29212403.37 89.75
Bad debt provision made on a combination basis:
Combined withdrawal item: property sales receivable
2022.12.312021.12.31
Expected Expected Accounts Bad debt Accounts Bad debt
credit loss credit loss
rec eivable provision receivable provision
rate (%) rate (%)
Within 1 year -- -- -- 1064220.18 53211.01 5.00
Combined withdrawal item: other customers receivables
2022.12.312021.12.31
Expected Expected
Accounts Bad debt Accounts Bad debt
credit loss credit loss
receivable provision receivable provision
rate (%) rate (%)
Within 1 year 60886221.17 2021549.50 3.32 58622042.15 1922299.77 3.28
(3) Additions recoveries or reversals of provision for the current period
Bad debt provision
2021.12.3131187914.15
Additions 3434265.84
Recoveries or reversals --
Written-off --
Adjustment to asset held for sale 593740.25
2022.12.3134028439.74
(4) The top five units with the ending balance of accounts receivable collected by the debtor
% of the total
Accounts receivable Bad debt provision
Name of the entity closing balance of
The ending balance The ending balance
accounts receivable
Wuhan Yutian Xingye Land Co. LTD 18325336.29 18.77 549760.09
121ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
% of the total Accounts receivable Bad debt provision
Name of the entity closing balance of
The ending balance The ending balance
accounts receivable
Wuhan 249 Poly Real Estate 13125855.00 13.45 393775.65
Development Co. Ltd.Shenzhen Hongteng Investment 11789376.23 12.08 7073625.74
Management Co. Ltd.Wuhan Linhong Real Estate Co. Ltd. 8106562.33 8.31 243196.87
Shenzhen Huatang Famous Wine City
2963112.003.04148155.60
Investment Co. Ltd.Total 54310241.85 55.65 8408513.95
At the end of the period due to the factoring of accounts receivable the factoring amount is CNY
51138077.62. At the same time the book value of accounts receivable is CNY 51138077.62 was not
derecognized. For pledge of accounts receivable please refer to Note V.51.
5. Prepayments
(1) The aging analysis of prepayments is as follows:
2022.12.312021.12.31
Aging
Amount % Amount %
Within 1 year 626155.65 53.81 4698254.37 95.90
1 to 2 years 336699.64 28.94 206.95 0.00
2 to 3 years 206.95 0.02 -- --
More than 3 years 200550.00 17.24 200550.00 4.10
Total 1163612.24 100.00 4899011.32 100.00
(2) The top five units of the ending balance of prepayments
The sum of the top five prepayments collected by prepaid objects at the end of the period is CNY
1091841.23 which accounts for 93.83 % of the total ending balance of prepayments.
6. Other receivables
Item 2022.12.31 2021.12.31
Interest receivable -- --
Dividends receivable -- 1052192.76
Other receivables 42105050.33 29561815.32
Total 42105050.33 30614008.08
(1) Dividends receivable
Items 2022.12.31 2021.12.31
Yunnan Kunpeng Air Service Co.--1052192.76
LTD
Less: Bad Debt Provision -- --
Total -- 1052192.76
122ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
(2) Other receivable
* Disclosure by aging
Aging 2022.12.31 2021.12.31
Within 1 year 48019676.18 29436729.02
1 to 2 years 1185433.74 905350.96
2 to 3 years 18023.00 106096.34
More than 3 years 188112549.84 188306797.86
Subtotal 237335682.76 218754974.18
Less: Bad Debt Provision 195230632.43 189193158.86
Total 42105050.33 29561815.32
* Disclosure by nature
2022.12.312021.12.31
Item Bad debt Book Bad debt
Book balance Book value Book value
provision balance provision
Other
receivables
from 147810.19 -- 147810.19 580911.83 -- 580911.83
employee‘s
petty cash
Other
receivables
from the
689317.63--689317.63627681.27--627681.27
collecting and
paying on
behalf
Other
receivables
80028366.4538760443.9441267922.5148840482.9120487260.6928353222.22
from other
customers
Other
receivables
156470188.49156470188.49-168705898.17168705898.17--
from related
parties
Total 237335682.76 195230632.43 42105050.33 218754974.18 189193158.86 29561815.32
* Bad Debt Provision
At the end of the period bad debt provision at the first stage:
Expected
credit loss rate Bad debt
Types Book balance Book value Reason
over the entire provision
duration (%)
Bad debt provisions made
--------
on an individual basis
Bad debt provisions made
on a combination basis
123ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Expected
credit loss rate Bad debt
Types Book balance Book value Reason
over the entire provision
duration (%)
Other receivables from
147810.19----147810.19
employee‘s petty cash
Other receivables from the
collecting and paying on 384124.22 -- -- 384124.22
behalf
Other receivables from other
43097874.843.541524758.9241573115.92
customers
Total 43629809.25 3.50 1524758.92 42105050.33
At the end of the period the Company does not have interest receivable dividends receivable and other
receivables at the second stage
At the end of the period bad debt provisions at the third stage:
Expected
credit loss rate Bad debt
Types Book balance Book value Reason
over the entire provision
duration (%)
Bad debt provisions made on
an individual basis
Other receivable from other Could be
19579543.90100.0019579543.90--
revoked subsidiary uncollectible
Other receivable from other Could be
surviving subsidiary uncollectible
Including : Other receivables Could be
155601920.01100.00155601920.01--
from related parties uncollectible
Other receivables from Could be
100.0018524409.60--
unrelated parties 18524409.60 uncollectible
Could be
Total 193705873.51 100.00 193705873.51 --
uncollectible
As at December 31 2021 bad debt provision at the first stage:
Expected
credit loss
Bad debt
Types Book balance rate over the Book value Reason
provision
next 12
months (%)
Bad debt provisions is drawn
--------
on a individual basis
Bad debt provisions is drawn
31053532.264.801491716.9429561815.32
on a combination basis
Other receivables from
580911.83----580911.83
employee‘s petty cash
Other receivables from the
collecting and paying on 627681.27 -- -- 627681.27
behalf
Other receivables from
29844939.165.001491716.9428353222.22
other customers
Total 31053532.26 4.80 1491716.94 29561815.32
124ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
As of December 31 2021 the Company does not have interest receivable dividends receivable and
other receivables at the second stage.As of December 31 2021 bad debt provisions at the third stage:
Expected
credit loss
Bad debt Book
Types Book balance rate over the Reason
provision value
next 12
months (%)
Bad debt provisions shall be
187701441.92100.00187701441.92--
made on an individual basis
Other receivable from other Could be
3838281.67100.003838281.67--
revoked subsidiary uncollectible
Other receivable from other Could be
183863160.25100.00183863160.25--
surviving subsidiary uncollectible
Including :Other receivables Could be
168705898.17100.00168705898.17--
from related parties uncollectible
Total 187701441.92 100.00 187701441.92 --
* Bad debt provisions in the current period
The first stage The second stage The third stage
Expected credit Expected credit loss Expected
Bad debt provision losses over the over the entire credit losses Total
entire duration (no duration (credit
over the next
credit impairment impairment has
12 months
occurred) occurred)
Balance as at December 31
1491716.94--187701441.92189193158.86
2021
The balance as at December 31
--------
2021 is in the current period
-- Turn to the second stage -- -- -- --
-- Transfer to the third stage -- -- -- --
-- Go back to the second stage -- -- -- --
-- Go back to the first stage -- -- -- --
Current period 233494.96 5631855.39 5865350.35
Return the current -- -- -- --
The current reseller -- -- -- --
This verification -- -- -- --
Other changes 200452.98 -- -372576.20 -172123.22
Balance as of December 31
1524758.92--193705873.51195230632.43
2022
125ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
* The top five units of ending balance of other receivables
Proportion of Ending Nature of Ending balance
total ending balance of
Name of the entity other of other Aging
balance of other bad debt
receivables receivables
receivables (%) provision
Other
Canada Great Wall receivables More than
89035748.0737.5289035748.07
(Vancouver) Co. Ltd from related 5 years
parties
Other
receivables More than
Paklid Limited 18870785.54 7.95 18870785.54
from related 5 years
parties
Other
Australia Bekaton
receivables More than
property 12559290.58 5.29 12559290.58
from related 5 years
Limited
parties
Other
Guangdong province
receivables More than
Huizhou Luofu Hill 10465168.81 4.41 10465168.81
from related 5 years
Mineral Water Co.Ltd
parties
Other
Xi‘an Fresh Peak
receivables More than
Property Trading Co. 8419205.19 3.55 8419205.19
from related 5 years
Ltd
parties
Total -- 139350198.19 -- 58.72 139350198.19
7. Inverntories
(1) Inventory classification
2022.12.312021.12.31
Provision for Provision
price for price
decline/provisi decline/prov Item Book on for The book ision for The book
Book balance
balance impairment of value impairment value
contract of contract
performance performanc
cost e cost
Real estate development：
Development
3413963261.85--3413963261.853037991969.96--3037991969.96
cost
Product
842847684.33--842847684.33994212857.29--994212857.29
development
Subtotals 4256810946.18 -- 4256810946.18 4032204827.25 -- 4032204827.25
Non-real estate development items:
Raw
8458.34 -- 8458.34 8458.34 -- 8458.34 materials
Inventory
329101.7038891.91290209.79334040.0438891.91295148.13
goods
Constructions -- -- -- 2425128.90 -- 2425128.90
Subtotals 337560.04 38891.91 298668.13 2767627.28 38891.91 2728735.37
Total 4257148506.22 38891.91 4257109614.31 4034972454.53 38891.91 4034933562.62
126ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
(2) Provision for inventories
Increase in current The reduced
Item 2022.01.01 To turn back or 2022.12.31
provision Others Others
resell
Non-real estate development items:
Raw
------------
materials
Inventory
38891.91532397.57----532397.5738891.91
goods
Total 38891.91 532397.57 -- -- 532397.57 38891.91
Provision for Decline in Inventory (continued)
Current roll-back or
Specific basis for determining net realizable/residual consideration roll-off
Item
and costs to be incurred Reasons for inventory
depreciation provision
Development The amount of estimated selling price minus the estimated costs to be
--
cost incurred at completion estimated selling expenses and related taxes
Product The amount of estimated selling price minus estimated selling expenses
--
development and related taxes
Raw The amount of estimated selling price minus the estimated costs to be
--
materials incurred at completion estimated selling expenses and related taxes
Inventory The amount of estimated selling price minus estimated selling expenses
--
goods and related taxes
The amount of estimated selling price minus the estimated costs to be
Construction --
incurred at completion estimated selling expenses and related taxes
(3) The ending balance of inventory contains the explanation of the capitalized amount of borrowing
expenses:
As at 31st December 2022 the Group's inventory balance contains capitalized borrowing costs at CNY
33933525.93.
(4) Development cost
Estimated Expected
Starting Ending
Project name completion total 2022.12.31 2021.12.31
time provision
time investment
ShanTou Fresh Peak
------28291908.1128291908.11--
Building
Shenfang Lin Xin
In 2021 In 2023 300000.00 2290805229.96 2015750061.85 --
Garden
Shenfang
In 2022 In 2024 152060.00 1094866123.78 993950000.00 --
GuangmingLi
Total 452060.00 3413963261.85 3037991969.96 --
127ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
(5) Product development
Time for
Increase in End of
The item name complet 2022.01.01 The reduced 2022.12.31
current the fall
ion
Jinye Island
199739494762.6051629.67--39546392.27--
Multi-tier villa
Jinye Island villa
20105696007.25----5696007.25--
No.10
Jinye Island villa
20082333281.42----2333281.42--
No.11
YueJing dongfang
20147305619.37--829214.616476404.76--
Project
HuangPu XinCun -- 140000.00 -- -- 140000.00 --
Shenfang Shanglin
2014----------
Garden
Beijing Fresh Peak
--304557.05----304557.05--
Buliding
TianYue Bay No.1 2017 270542054.67 2240.00 44890771.84 225653522.83 --
Shengfang CuiLin
201858669056.16--13051618.3745617437.79--
Building
Chuanqi Donghu 2019 41834057.24 -- 37544138.07 4289919.17 --
TianYue Bay No.2 2021 567893461.53 -- 55103299.74 512790161.79 --
Total 994212857.29 53869.67 151419042.63 842847684.33 --
8. Assets and liabilities held for sale
2022.12.312021.12.31
Item Provision Provision Carrying Carrying
Book value for Book value for
amount amount
impairment impairment
1) Non-current assets
------------
held for sale
(2) Assets included in
disposal groups held -- -- -- -- -- --
for sale
Including：
Shenzhen Property
------78940232.10--78940232.10
Management Co.Ltd.Total -- -- -- 78940232.10 -- 78940232.10
Item 2022.12.31 2021.12.31
Liabilities held for sale: -- --
Liabilities included in disposal groups
----
held for sale
Including：
Shenzhen Property Management -- 65752452.06
Co. Ltd.Total -- 65752452.06
In order to optimize and adjust the industrial structure on 30 December 2021 the Company and its
128ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
subsidiary Shenzhen Shenfang Investment Co. Ltd. and Shenzhen Guomao Property Management Co.Ltd. signed the Equity Acquisition Agreement to transfer a total of 100% of the equity of Shenzhen
Property Management Co. Ltd. to Shenzhen Guomao Property M anagement Co. Ltd. with a transfer
price of CNY 196.6767 million. The transfer of equity was completed in February 2022.
9. Other current assets
Item 2022.12.31 2021.12.31
Income tax overpaid or prepaid 1692386.28 3205104.33
VAT prepaid 1620352.66 7643969.22
Contract acquisition cost 1212848.49 --
Input tax to be deducted 29247467.16 53061826.30
Land appreciation tax 1813337.72 2481541.71
Business Tax 250719.98 259308.30
Other 941529.13 1565137.18
Total 36778641.42 68216887.04
129ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
10. Long-term equity investments
Movements during the year
Investment Declared Balance of
income
Increase ther Other distribution Provision provision for Investee 2020.12.31 Decrease recognised 2022.12.31
in comprehensive equity of cash for Other impairment as
in capital under
capital incom movements dividends impairment at 2022.12.31
equity
or profits
method
* Joint ventures
Guangdong
province Huizhou
9969206.09----------------9969206.099969206.09
Luofu Hill Mineral
Water Co. Ltd
Fengkai Xinhua
9455465.38----------------9455465.389455465.38
Hotel
Subtotal 19424671.47 -- -- -- -- -- -- -- -- 19424671.47 19424671.47
* Associates
Shenzhen Ronghua
1349122.92-----178240.64----------1170882.281076954.64
JiDian Co. ltd
Shenzhen Runhua
Automobile trading 1445425.56 -- -- -- -- -- -- -- -- 1445425.56 1445425.56
Co. Ltd
Dongyi Real Estate
30376084.89----------------30376084.8930376084.89
Co. Ltd
Subtotal 33170633.37 -- -- -178240.64 -- -- -- -- -- 32992392.73 32898465.09
* Other equity
-
investment
Paklid Limited 201100.00 -- -- -- -- -- -- -- -- 201100.00 201100.00
Australia Bekaton
906630.00----------------906630.00906630.00
Property Limited
Shenzhen Shenfang
Department Store 10000000.00 -- -- -- -- -- -- -- -- 10000000.00 10000000.00
Co. Ltd.
130ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Movements during the year
Investment Declared Balance of
income
Increase ther Other distribution Provision provision for Investee 2020.12.31 Decrease recognised 2022.12.31
in comprehensive equity of cash for Other impairment as
in capital under
capital incom movements dividends impairment at 2022.12.31
equity
or profits
method
Shantou Fresh Peak 58547652.25 -- -- -- -- -- -- -- -- 58547652.25 58547652.25
Building
Guangdong
Province kaiFeng
Lian Feng Cement 56228381.64 -- -- -- -- -- -- -- -- 56228381.64 56228381.64
Manufacturing Co.Ltd
Jiangmen XinJiang
9037070.89----------------9037070.899037070.89
real estate compnay
Xian Xinfeng 32840729.61 -- -- -- -- -- -- -- 32840729.61 32840729.61
property trading ltd.Subtotal 167761564.39 -- -- -- -- -- -- -- 167761564.39 167761564.39
Total 220356869.23 -- -- -178240.64 -- -- -- -- -- 220178628.59 220084700.95
Note：Other equity investment items are the equity of the Company's subsidiaries which are not included in the scope of the merger. Some of these subsidiaries
were winded up but the Group hasn‘t write off its long-term equity investment. Some of these subsidiaries have ceased operating for many years and no longer
exist the group could not implement effective management control over them. Refer to Note VII for more details.
131ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
11. Investment in other equity instruments
Item 2022.12.31 2021.12.31
Shantou SME Financing Guarantee Co.
13839235.5713831938.92
Ltd.Yunnan Kun Peng Aviation Service Limited
--22490765.41
Corporation
Total 13839235.57 36322704.33
Note: Since the Group plans to hold the above equity investment for a long term for strategic purposes
the Group designates them as financial assets measured at fair value and the change in it is included in
other comprehensive income.The amount of
Dividend other
income The The comprehensive
Item recognized cumulative cumulative income To reason
during the gains loss transferred into
current period retained
earnings
Shantou SME Financing
813960.005550600.00------
Guarantee Co. Ltd.Yunnan Kun Peng
Disposal of the
Aviation Service Limited -- 11449773.26 -- 11449773.26
investment
Corporation
12. Investment Properties
(1) Investment properties measured using the cost model
Item Buildings Land use rights Total
Ⅰ.Cost
1.2021.12.311042912022.3998272942.191141184964.58
2.Additions during the year 1832873.00 9077110.86 10909983.86
（1）Transfers from inventories 1832873.00 -- 1832873.00
（2）Other transfers(exchange rate
--9077110.869077110.86
movement)
3. Decrease during the year -- -- --
4.2022.12.311044744895.39107350053.051152094948.44
" .Accumulated depreciation or
amortization
1.2021.12.31457533453.68--457533453.68
2.Charge for the year 25451837.52 -- 25451837.52
（1）Depreciated or amortised 25451837.52 -- 25451837.52
3. Reductions during the year -- -- --
4.2022.12.31482985291.20--482985291.20
III.Provision for impairment
1.2021.12.3114128544.6280657189.1294785733.74
2.Charge for the year -- 7450008.43 7450008.43
132ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Item Buildings Land use rights Total
（1）Other additions (exchange rate
--7450008.437450008.43movement）
3. Reductions on disposals -- -- --
4.2022.12.3114128544.6288107197.55102235742.17
IV.Carrying amounts
1. As at 2022.12.31 547631059.57 19242855.50 566873915.07
2. As at 2021.12.31 571250024.09 17615753.07 588865777.16
Note: The reduction in the original value of land use rights and impairment provisions is caused by
exchange rate movement at the time of translation of foreign currency statements.
13. Fixed assets
Item 2022.12.31 2021.12.31
Fixed assets 21425475.05 23920424.55
Disposal of fixed assets -- --
Total 21425475.05 23920424.55
* Fixed assets
Plant & Machinery & Electronic device and
Item Total
buildings equipment others
I.Cost
1.2021.12.31100117808.108307455.417273579.83115698843.34
2.Additions during the year 304266.00 -- 225891.54 530157.54
（1）Purchases 304266.00 -- 225891.54 530157.54
3. Decrease during the
----95472.6795472.67
year
（1）Disposals or
----95472.6795472.67
written-offs
4.2022.12.31100422074.108307455.417403998.70116133528.21
II.Accumulated
depreciation:
1.2021.12.3179191129.846864681.165722607.7991778418.79
2.Charge for the year 2458308.93 246603.31 313773.37 3018685.61
(1)Provision 2458308.93 246603.31 313773.37 3018685.61
3.Reductions for the year -- -- 89051.24 89051.24
(1)Disposal or written-offs -- -- 89051.24 89051.24
4.2022.12.3181649438.777111284.475947329.9294708053.16
III.Provision for impairment -- -- -- --
IV.Carrying amount
1. As at 2022.12.31 18772635.33 1196170.94 1456668.78 21425475.05
2. As at 2021.12.31 20926678.26 1442774.25 1550972.04 23920424.55
133ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
14. Right-of-use assets
project Houses and Buildings
I. Original book value:
2021.12.31431779.61
2. Additions during the year --
3. Decrease during the year --
4.2022.12.31431779.61
II. Accumulative depreciation
1.2021.12.3166427.64
2. Additions during the year 132855.25
（1）Provision 132855.25
3. Decrease during the year --
4.2022.12.31199282.89
III. Impairment Provisions --
IV.Carrying amount
1. As at 2022.12.31 232496.72
2. As at 2021.12.31 365351.97
15. Intangible assets
(1) Intangible assets
Item Software
I.Cost
1.2021.12.312192000.00
2.Additions during the year --
3.Decrease during the year --
4.2022.12.312192000.00
II.Accumulative amortization
1.2021.12.312192000.00
2.Additions during the year --
3.Decrease during the year --
4.2022.12.312192000.00
III.Provision for impairment --
IV.Carrying amount
1. As at 2022.12.31 --
2. As at 2021.12.31 --
134ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
16. Long-term deferred expenses
Decreases during the year
Additions
Item 2021.12.31
during the year Amortisation Others
2022.12.31
for the year decreases
Renovation costs 1703967.55 548981.45 533891.01 -- 1719057.99
Others 460995.63 179091.09 182923.18 -- 457163.54
Total 2164963.18 728072.54 716814.19 -- 2176221.53
17. Deferred tax assets and deferred tax liabilities
(1) Deferred tax assets and deferred tax liabilities that are not offset
2022.12.312021.12.31
Item Deductible/Taxable Deductible/Taxable Deferred tax Deferred tax
Temporary Temporary
assets/liabilities assets/liabilities
Differences Differences
Deferred tax assets:
Provision for impairment 12026682.71 3006670.68 11676505.43 2919126.36
Pre-tax recoverable
69038992.7117259748.1860853662.7215213415.68
operating losses
Provision for land
117245335.2629311333.82537081594.36134270398.59
appreciation tax
Unrealised profits of
86124778.4121531194.6048439321.6812109830.42
intra-group transactions
Accrued Contractual cost 23711126.84 5927781.70 22029322.92 5507330.73
Subtotal 308146915.93 77036728.98 680080407.11 170020101.78
Deferred tax liabilities:
Unmatured interest 1576125.00 394031.25 7411964.20 1852991.05
Changes in the fair value 1839235.57
of other equity 459808.89 18858463.59 4714615.90
investments
Changes in the fair value 8970031.50
2242507.8811828130.442957032.61
of trading financial assets
Subtotal 12385392.07 3096348.02 38098558.23 9524639.56
(2) Details of unrecognized deferred tax assets
Item 2022.12.31 2021.12.31
Deductible losses 54027120.82 10875646.42
Bad debt provision 197543730.87 211607688.34
Impairment provision for long-term equity
220084700.95220084700.95
investments
Impairment provision for Investment property 102235742.17 94785733.74
Total 573891294.81 537353769.45
Note：Due to the uncertainty of future taxable income the Group did not recognize deferred tax assets
for the temporary deductible differences and deductible losses.
135ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
(3) Expiration of deductible tax losses for unrecognised deferred tax assets
Year 2022.12.31 2021.12.31 Note
2022——5753184.38
20234085485.244085485.24
2024688456.49688456.49
20251629.251629.25
2026346891.06346891.06
202748904658.78——
Totao 54027120.82 10875646.42
18. Short-term loans
(1) Classification of short-term loans
Item 2022.12.31 2021.12.31
Pledge loans 51138077.62 50440116.24
Note: The ending balance of loan is related to factoring loan applied by the group for accounts
receivable.
19. Notes payable
Item 2022.12.31 2021.12.31
Commercial acceptance notes -- 247376403.56
Banker acceptance notes -- --
Total -- 247376403.56
Note: The notes payable due but unpaid at the year end is CNY 222341886.44. It has been adjusted to
account payable.
20. Accounts payable
Item 2022.12.31 2021.12.31
Construction 432902243.31 139000203.58
Other 1699316.36 2447355.66
Total 434601559.67 141447559.24
21. Advances from customers
Item 2022.12.31 2021.12.31
Payment for goods-import and
4218370.694218370.69
export
Others 1246973.27 2193056.35
Total 5465343.96 6411427.04
136ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
22. Contractual liabilities
Item 2022.12.31 2021.12.31
Advance collection of house sales 43431327.09 199909796.88
Room charges in advance 102140.20 55693.20
Total 43533467.29 199965490.08
23. Employee benefits payable
Accrued during Decreased
Item 2021.12.31 2022.12.31
the year during the year
Short-term employee benefits 43791988.37 71499532.64 79619168.64 35672352.37
Post-employment benefits - defined
134723.419793422.649876294.6451851.41
contribution plans
Total 43926711.78 81292955.28 89495463.28 35724203.78
(1) Short-term employee benefits
Accrued during Decreased
Item 2021.12.31 2022.12.31
the year during the year
Salaries bonus allowances 43636961.65 56562279.75 64987862.63 35211378.77
Staff welfare 35800.00 3847923.24 3662981.24 220742.00
Social insurances -- 3912890.25 3912890.25 --
Including：1. Medical insurance -- 3682819.92 3682819.92 --
2. Work-related injury insurance -- 50853.63 50853.63 --
3. Maternity insurance -- 179216.70 179216.70 --
Housing Fund 31040.32 5791378.33 5822418.65 --
Labor union fees staff and
88186.401385061.071233015.87240231.60
workers‘ education fee
Total 43791988.37 71499532.64 79619168.64 35672352.37
(2) Defined contribution plans
Accrued during Decreased
Item 2021.12.31 2022.12.31
the year during the year
Post-employment benefits 134723.41 9793422.64 9876294.64 51851.41
Including: 1. Basic pension
72000.006322580.456394580.45--
insurance
2．Unemployment insurance -- 70260.71 70260.71 --
3．Annuity 62723.41 3400581.48 3411453.48 51851.41
Total 134723.41 9793422.64 9876294.64 51851.41
24. Taxes payable
Item 2022.12.31 2021.12.31
Corporate income tax 61927050.99 55260539.21
Land appreciation tax 121891472.74 541127363.69
137ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Item 2022.12.31 2021.12.31
Value-added tax 3843704.80 2364703.76
Individual income tax 1611643.13 741740.25
City maintenance and construction
734949.61243387.84
tax
Property tax 287141.98 262015.56
Education surcharge 316008.58 105021.26
Local Education surcharge 197568.44 56806.29
Other 141645.72 379294.62
Total 190951185.99 600540872.48
25. Other payables
Item 2022.12.31 2021.12.31
Interest payables 16535277.94 16535277.94
Dividend payables -- --
Other payables 557796062.90 564842137.70
Total 574331340.84 581377415.64
(1) Interest payable
Item 2022.12.31 2021.12.31
Non-financial institution borrowing interest (interest
16535277.9416535277.94
payable to parent company)
Significant overdue interest outstanding:
Debtor Overdue amount Overdue reason
Shenzhen Investment Holdings Co. Ltd. 16535277.94 Defer payment
(2) Other payable
Item 2022.12.31 2021.12.31
Non-related party transactions 166065259.07 161537615.36
Accrued land appreciation tax -- 36447111.94
Related party transactions 232502015.42 215460862.07
Deposits 28723844.16 48106373.19
Others 130504944.25 103290175.14
Total 557796062.90 564842137.70
(3) significant other payables aging over 1 year
Item Amount Aging Reason
Guangzhou Bopi Enterprise Management Within 1 year 1-2
202424649.66 Unexpired settlement
Consulting Co. LTD years
Huizhou Guirong Investment Information Within 1 year 1-2
99553857.53 Unexpired settlement
Consulting Co. LTD years
Total 301978507.19
138ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
26. Non-current liabilities due within one year
Item 2022.12.31 2021.12.31
A long-term loan that due within one year 6105770.99 --
Lease liabilities due within one year 83023.44 83023.44
Total 6188794.43 83023.44
27. Other current liabilities
Item 2022.12.31 2021.12.31
Output tax to be transferred 2265817.68 8196849.13
Notes receivable that have been endorsed but
1617000.00--
cannot be terminated for recognition
Total 3882817.68 8196849.13
28. Long-term loans
Range of Range of
Item 2022.12.31 2021.12.31
interest rate interest rate
Mortgage loan 60366770.99 4.15%-4.20% --
Subtotal 60366770.99 --
Less: long-term loans due within one year 6105770.99 --
Total 54261000.00 --
29. Lease liabilities
Item 2022.12.31 2022.01.01
Buildings 136908.67 208944.21
Subtotal 136908.67 208944.21
Less: lease liabilities due within one year 83023.44 83023.44
Total 53885.23 125920.77
30. Capital stock (unit: 10000 shares)
Increase or decrease of current period (+ -)
Item 2021.12.31 Conversion New Stock
from reserve Others Subtotal 2022.12.31
shares dividand
to shares
The total
number of 101166.00 -- -- -- -- -- 101166.00
shares
31. Capital reserve
Additions during Reductions
Item 2020.12.31 2021.12.31
the year during the year
Share premium 557433036.93 -- -- 557433036.93
Other capital reserves 420811873.18 -- -- 420811873.18
Total 978244910.11 -- -- 978244910.11
139ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
32. Other comprehensive income
Other comprehensive income attributable to the parent company in the balance sheet.Current amount
Minus: early entry into 2022.12.31 2021.12.31
Item The current income other comprehensive （4）=（1）+
（1） tax before the amount income into the （2）
(2) current period of profit
and loss (3) -（3）
Other comprehensive income
that cannot be reclassified into 14143847.69 -1314647.75 11449773.26 1379426.68
profits and losses
1. Changes in the fair value of
other equity instrument 14143847.69 -1314647.75 11449773.26 1379426.68
investments
Other comprehensive
income which is reclassified 21945116.26 2602177.91 -- 24547294.17
into profit and loss
1. Difference in translation of
foreign currency financial 21945116.26 2602177.91 -- 24547294.17
statements
Total other comprehensive 36088963.95 1287530.16 11449773.26 25926720.85
income
Other comprehensive income attributable to the parent company in the income statement.Current amount
Minus: early
entry into other After tax it After-tax
comprehensive Minus: attributable Item belongs to to parent
2021.12.31 (1) income into the income tax minority company（5）
current period expense (3) shareholders =（1）-（2）
of profit and (4) -（3）-（4）
loss (2)
Other comprehensive income
that cannot be reclassified into -1752863.67 -- -438215.92 -- -1314647.75
profits and losses
1. Changes in the fair value
of other equity instrument
-1752863.67---438215.92---1314647.75
investments
Other comprehensive
irneccolamssei fied inwtoh ipcrho fit andis -29418.67 -- -5883.73 -2625712.85 2602177.91
loss
1. Difference in translation of
foreign currency financial -29418.67 -- -5883.73 -2625712.85 2602177.91
statements
Total other comprehensive
income -1782282.35 -444099.65 -2625712.85 1287530.16
Note: The net after-tax amount of other comprehensive income during reporting period is CNY
-1338182.69including CNY 1287530.16 attributable to the shareholders of the parent company and
CNY 2625712.85 attributable to minority shareholders.
140ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
33. Surplus reserve
Opening Additions during Reductions
Item Ending balance
balance the year during the year
Statutory surplus reserve 241144854.93 34108874.33 -- 275253729.26
Total 241144854.93 34108874.33 -- 275253729.26
34. Retained earnings
Appropriation
Item Year ended 2022.12.31 Year ended 2021.12.31 or distribution
percentage
Retained earnings as at 31/12/2021(before
1671121562.981560720254.31--
adjustment)
Total adjustments for opening retained
------
earnings（―+‖ for increase; ―–‖ for decrease）
Retained earnings as at 01/01/2021 (after
1671121562.981560720254.31--
adjustment)
Add: Net profits for the year attributable to
153718805.57220836309.93--
shareholders of the Group
Less: Appropriation for statutory surplus
34108874.3322420581.2610%
reserve
Appropriation for ordinary share dividend 89026080.00 88014420.00 --
Other -11449773.26 -- --
Retained earnings as at 2022.12.31 1713155187.48 1671121562.98 --
Note: the other CNY 11449773.26 of undistributed profits in this period is due to the investment of
other equity instruments which includes the disposal profits as retained earnings.
35. Operating revenue and operating costs
(1) Operating revenue and operating costs
Current amount Amount of previous period
Item
Income Cost Income Cost
Main business 628832520.51 434304905.37 1305013711.33 644196683.45
Other
5552040.912747095.6415776937.1222151678.03
business
Total 634384561.42 437052001.01 1320790648.45 666348361.48
(2) Operating revenue and operating costs are divided by industry (or product type)
Current amount Amount of previous period
Main Industry name
income The cost of income The cost of
Real estate 309331841.57 144720332.63 876161088.60 280828284.77
Construction 241209525.79 236074624.77 200259571.16 194607475.30
Property Management 36660871.83 22415236.68 162526580.18 145898235.49
Lease 53870265.26 46657985.12 81791161.56 38780101.44
subtotal 641072504.45 449868179.20 1320738401.50 660114097.00
Less：Internal offset 12239983.94 15563273.83 15724690.17 15917413.55
Total 628832520.51 434304905.37 1305013711.33 644196683.45
141ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
(3) The revenue and cost of main business shall be divided by region (if not applicable it shall be
deleted)
Current amount Amount of previous period
Main business area Main business Main business Main business Main business
revenue cost revenue cost
Domestic： 640594852.83 449868179.20 1320105876.64 660114097.00
Guangdong Province 640594852.83 449868179.20 1308786001.07 652104794.06
Other -- -- 11319875.57 8009302.94
Overseas： 477651.62 -- 632524.86 --
America 477651.62 -- 632524.86 --
Subtotal 641072504.45 449868179.20 1320738401.50 660114097.00
Less：Internal offset 12239983.94 15563273.83 15724690.17 15917413.55
Total 628832520.51 434304905.37 1305013711.33 644196683.45
(4) Business revenue decomposition information
Current amount
Item Property
Real estate Construction Leases Other Total
Management
Main business
309331841.57236949097.4536436288.2146115293.28--628832520.51
revenue
Including: Confirm at 309331841.57 -- -- -- -- 309331841.57
a certain point
Confirm at a certain
--236949097.4536436288.2146115293.28--319500678.94
time
Other business
--------5552040.915552040.91
income
Total 309331841.57 236949097.45 36436288.21 46115293.28 5552040.91 634384561.42
36. Taxes and surcharges
Current Amount of previous
Item
amount period
Land appreciation tax 68994085.35 234706353.29
Property tax 7527796.10 9928730.40
Urban maintenance and construction tax 1984035.04 4235765.07
education surcharge 845915.69 1910215.37
Local education surcharge 563479.01 1081322.37
Embankment protection fees 1868180.35 2497929.35
Total 81783491.54 254360315.85
Note: the tax and additional payment standards are detailed in Note IV. Tax.
37. Selling expense
Item Current amount Amount of previous period
Sales agency fee and commission 9153738.82 26587685.99
Employee benefits 3840229.00 9474880.74
142ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Item Current amount Amount of previous period
Entertainment expenses 1381173.87 3261755.78
Advertising expenses 4350998.80 2932966.45
Other 491454.62 480459.26
Total 19217595.11 42737748.22
38. Administrative expenses
Item Current amount Amount of previous period
Employee benefits 39755710.03 79343163.63
Agency fee 2752109.58 4027178.08
Entertainment expenses 2425452.83 2857097.54
Depreciation expense 2785592.23 2567845.33
Office expenses 1849010.18 2364940.64
Maintenance expenses 336048.95 985033.96
Office expenses 520782.12 496794.63
Other Amortization 481562.84 421749.41
water and electricity 359004.64 273581.21
Other 4493475.68 4970447.17
Total 55758749.08 98307831.60
39. Financial expenses
Amount of previous
Item Current amount
period
The interest payments 21696059.62 12247386.77
Minus: Capitalization of interest 21696059.62 12237466.31
Interest income 5315817.53 28863878.27
Exchange gains and losses -1384499.52 9320742.60
Minus: Capitalization of exchange gains
----
and losses
Commission charges and others 193170.02 1449724.20
Total -6507147.03 -18083491.01
40. Other income
With respect to
Current Amount of previous
Subsidies (other sources of revenue) assets /
amount period
Related to revenue
VAT deduction 67836.22 1483095.28 Related to revenue
Subsidies for job-for-training 86775.00 165000.00 Related to revenue
Additional deductions for input tax -- 11384.12 Related to revenue
Renovation of back streets and alleys around
-- 10000.00 Related to revenue
farmers' markets (public health fund)
Subsidies for keeping people in their jobs 162265.76 -- Related to revenue
Refund of procedure fee of personal income tax 225814.59 -- Related to revenue
Subsidies for assisting enterprises in obtaining
10000.00 -- Related to revenue
employment
Other 7111.62 -- Related to revenue
Total 559803.19 1669479.40
143ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
41. Investment Income
Current Amount of previous
Item
amount period
Long-term equity investment income calculated by the equity
-178240.64-105321.37
method
Dividend income from investments in other equity instruments 813960.00 692580.00
Yield on maturity of structured deposits 159619.01 1196580.44
Investment income from disposal of subsidiaries 161581081.50 --
Investment income from debt restructuring 2610128.30 --
Total 164986548.17 1783839.07
42. Income from changes in fair value
Amount of previous
The source of the fair value change income Current amount
period
Trading financial assets 8970031.50 11828130.44
43. Credit impairment loss (loss marked with "-")
Amount of previous
Item Current amount
period
Accounts receivable bad debt loss -3434265.84 -4433371.85
Other losses on receivable bad debts -5865350.35 -2362779.29
Bad debt losses on notes receivable 2783378.85 -999068.57
Total -6516237.34 -7795219.71
44. Impairment loss of assets (loss is marked with "-")
Amount of previous
Item Current amount
period
Losses from falling inventory prices -532397.57 268941.60
45. Income from asset disposal
Current Amount of previous
Item
amount periodGain on disposal of fixed assets (loss is marked with "-")） -- -8852.73
46. Non-operating income
Amount booked into
Amount of previous
Item Current amount current non-recurring
period
profits and losses
Compensation 1156843.63 -- 1156843.63
Penalty income 370000.00 1506996.67 370000.00
Other -- 210438.20 --
Income from sale of waste 7807.75 28700.00 7807.75
Total 1534651.38 1746134.87 1534651.38
144ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
47. Non-operating expenses
Amount booked into
Amount of
Item Current amount current non-recurring
previous period
profits and losses
Public welfare donation expenditure 306474.53 31464.96 306474.53
Loss of non-current assets damaged and
38481.9216439.2038481.92
scrapped
Penalty 50.00 85686.90 50.00
Other 133936.29 74538.68 133936.29
Total 478942.74 208129.74 478942.74
48. Income tax expenses
(1) Income tax expense details
Item Current amount Amount of previous period
Current income tax calculated according to the
-20528623.91125965276.65
tax law and relevant provisions
Deferred tax expense 86555081.26 -57160740.87
Total 66026457.35 68804535.78
(2) The relationship between income tax expense and total profit is listed as follows :(inapplicable items
can be deleted and "other" amounts should not be too large)
Item Current amount Amount of previous period
Profit total 215603328.30 286404205.51
Income tax expense at statutory (or applicable) rate (gross
53900832.0871601051.38
profit *25%)
Impact of different tax rates applied to certain subsidiaries 148585.06 -810905.02
Adjustment of income tax for the current period of the
-6828454.83-378391.66
previous period
The profits and losses of joint ventures and associated
44560.1626330.35
enterprises calculated by equity method
Tax-free income (marked with "-") -232317.56 -173145.00
Non-deductible costs expenses and losses 621871.15 563064.63
Take advantage of the tax impact of unrecognized deductible
losses and deductible temporary differences in previous -598646.13 -2131851.54
years (fill in with "-")
Tax effects of deductible losses and deductible temporary
18970027.42108382.64
differences are not recognized
Income tax expense 66026457.35 68804535.78
49. Notes for items in the statement of cash flows
(1) Receipt of other cash related to operating activities
Item Current amount Amount of previous period
Interest Income 5315817.53 39813057.28
Receivables and others 19283483.81 338784024.72
Total 24599301.34 378597082.00
145ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
(2) Other cash payments related to operating activities
Item Current amount Amount of previous period
Charges 192970.02 1449724.20
Out-of-pockets expenses 28511217.46 50267187.02
Payables and others 44617346.03 231759408.78
Total 73321533.51 283476320.00
(3) Receipt of other cash related to investment activities
Item Current amount Amount of previous period
Financing products and etc. 114840380.99 797803419.53
(4) Other cash payments related to investment activities
Item Current amount Amount of previous period
Financing products and etc. -- 1300000000.00
(5) Receipt of other cash in connection with financing activities
Item Current amount Amount of previous period
Borrowings from subsidiary shareholders -- 193016852.52
fund from Linxijun employees -- 22800000.00
Total -- 215816852.52
50. Supplementary information to the statement of cash flows
(1) Supplementary information of the cash flow statement
Amount of
Additional information Current amount
previous period
1. Adjust net profit to cash flow from operating activities
Net profit 149576870.95 217599669.73
Plus: impairment loss on assets 532397.57 -268941.60
Credit impairment loss 6516237.34 7795219.71
Depreciation of Fixed Assets Depreciation of Usability Assets
Depreciation of Investment Real Estate Depreciation of Oil and Gas
28470523.1329162034.64
Assets Depreciation of Productive Biological Assets (Items not
applicable can be deleted)
Amortization of intangible assets 132855.25 --
Amortization of long-term prepaid expenses -- --
Loss on disposal of fixed assets intangible assets and other
716814.19240227.24
long-term assets (marked with "-" for gains)
Loss on the scrapping of fixed assets (marked with "-" for
--13451.61
income)
Loss from changes in fair value (marked with "-" for earnings) 38481.92 16439.20
Financial expenses (revenue marked with "-") -8970031.50 -11828130.44
Loss on investment (marked with "-" for income) 492336.21 450266.20
146ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Amount of
Additional information Current amount
previous period
Deferred tax assets decreased (marked with "-" for increase) -164986548.17 -1783839.07
Deferred tax liability increased (marked with "-" for decrease) 92983372.80 -57380478.73
Decrease in stock (marked with "-" for increase) -6428291.54 85543.83
Decrease of operating receivable items (marked with "-" for
-222176051.69-1600400189.74
increase)
Increase in operational payable items (marked with "-" for
-15439705.9279815735.11
decrease)
other -537235259.30 130530884.37
Net cash flow from operating activities -- --
2. Major investment and financing activities that do not involve
-675775998.76-1205952107.94
cash receipts and expenditures:
Debt to capital
A convertible corporate bond maturing within one year -- --
Leasing of fixed assets through financing -- --
3. Net changes in cash and cash equivalents: -- --
Ending balance of cash
Minus: Opening balance of cash 190365069.48 612293635.15
Plus: ending balance of cash equivalents 612293635.15 2669103926.82
Minus: Beginning balance of cash equivalents -- --
Net increase in cash and cash equivalents -- --
-421928565.67-2056810291.67
（2） Net cash received from disposal of subsidiaries and other business units in the current period
Item Current amount
Cash or cash equivalents received from disposal of subsidiaries in the
214862911.00
current period
Including: Shenzhen City Property Management Ltd. 196676700.00
Minus: Cash and cash equivalents held by the subsidiary on the date of
57467430.10
loss of control
Including: Shenzhen City Property Management Ltd. 57467430.10
Plus: Disposal of cash or cash equivalents received by the subsidiary in
--
the current period during the previous period
The net amount of cash received by the disposal subsidiary 157395480.90
（3） Composition of cash and cash equivalents
Item Ending balance Opening balance
1. Cash 190365069.48 612293635.15
Including: cash on hand 4549.61 12082.00
Bank deposits available for payment at any time 157360519.87 372181553.15
Other monetary fund readily available for payment 33000000.00 240100000.00
2. Cash equivalents -- --
Including: bond investments maturing within three months -- --
147ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Item Ending balance Opening balance
3. Closing cash and cash equivalents balance 190365069.48 612293635.15
Where: the parent company or a subsidiary of the group uses
----
restricted cash and cash equivalents
51. Assets whose ownership or use rights are restricted
Item Ending book value Reason for limitation
funds for the construction of public facilities in
Cash at bank and Cash Equivalent 5674439.78
and around the city of Longgang District
Cash at bank and Cash Equivalent 48315.48 Frozen by litigation
Accounts receivables 51138077.62 Pledge of short-term loans
Inventories 965000000.00 Land Mortgage for project development loan
Total 1021860832.88
52. Foreign currency monetary items
(1) Foreign currency monetary items
Ending Foreign Balance converted
Item Exchange rate
Currency Balance into CNY at the end
Monetary fund
Including: US dollar 14982.22 6.9646 104345.17
Hong Kong dollars 6387228.27 0.8933 5705711.01
Accounts receivable -
Including: US dollar 8000.00 6.9646 55716.80
Hong Kong dollars 4905150.10 0.8933 4381770.58
Prepayments -
Including: Hong Kong dollars 253.12 0.8933 226.11
Accounts payable -
Including: Hong Kong dollars 2000.00 0.8933 1786.60
Other payables -
Including: US dollar 11781.17 6.9646 82051.14
53. Government subsidies
The government subsidies accounted into the current profits and losses by the total amount method
Amount booked Amount booked Reporting items
into profit and into profit and Relating to
Subsidy Item species included in
loss in the loss for the assets/earnings
profit and loss
previous period current period
Related to
Tax subsidy Fiscal allotment 1494479.40 67836.22 Other Income
earnings
Related to
Employment subsidies Fiscal allotment 165000.00 86775.00 Other Income
earnings
Total 1659479.40 154611.22
148ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
VI. Changes to the scope of consolidation
1. Disposal of subsidiaries
（1）Reduction of subsidiaries from single disposal to loss of control
The difference
between the The
disposal price and goodwill The basis
the share of the associated The point for
Equity Disposal Percentage of Equity subsidiary's net with the
Name of at which determining
Price equity Disposal assets at the subsidiary
subsidiary control is the point of
disposal Method consolidated in the
lost loss of
financial statement Consolidate
control
level corresponding d Financial
to the disposal Statements
investment
The
completion
Shenzhen
Assignment of industrial
Property February
196676700.00 100.00 by and 161581081.49 --
Management 112022
agreement commercial
Co. Ltd
change
registration
Continued (1)：
The method and The amount of other
The book The fair Gains/losses main comprehensive gains
The percentage of value of the value of the arising from assumptions for related to the equity
Name of shares remaining at remaining remaining the determining the investment of the
subsidiary the date of loss of equity at the equity at the re-measurem fair value of the Atomic Company
control date of loss date of loss ent at fair remaining equity transferred to the
of control of control value on the date of investment gains and
loss of control losses
Shenzhen
Property
------------
Management
Co. Ltd
2. Other
In 2022 the group cancelled a total of 3 subsidiaries and subsidiaries that had been revoked and had
no business namely Shenzhen Special Economic Zone Real Estate (Group) Guangzhou Property and
Estate Co. Ltd. QiLu Co. Ltd. and QiYi Development Co. Ltd..VII. Interest in other entities
VII. Interests in subsidiaries
(1) Composition of the Group
Principal
Registration Business Shareholding% Acquisition
Name place of
place nature
business Direct Indirect
method
Acquiring
Shenzhen City SPG Long Real estate through
Shenzhen Shenzhen 95.00 5.00
Gang Development Ltd. development establishment or
investment
149ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Principal
Registration Business Shareholding% Acquisition
Name place of
place nature Direct Indirect method business
Acquiring
American Great Wall Co. Real estate through
U.S. U.S. 70.00 --
Ltd development establishment or
investment
Acquiring
Shenzhen Petrel Hotel through
Shenzhen Shenzhen Hotel Services 68.10 31.90
Co. Ltd. establishment or
investment
Acquiring Installation
Shenzhen Zhen Tung through
Shenzhen Shenzhen and 73.00 27.00
Engineering Ltd. establishment or
maintenance
investment
Acquiring
Shenzhen City We Gen
through
Construction Management Shenzhen Shenzhen Supervision 75.00 25.00
establishment or
Ltd.investment
Mechanical & Acquiring
Shenzhen Lain Hua
Electrical through
Industry and Trading Co. Shenzhen Shenzhen 95.00 5.00
device establishment or
Ltd.installation investment
Acquiring Investment
Fresh Peak Enterprises through
Hong Kong Hong Kong and 100.00 --
Ltd. establishment or
management
investment
Acquiring Investment
through
Fresh Peak Holdings Ltd. Hong Kong Hong Kong and 100.00 --
establishment or
management
investment
Acquiring
Shenzhen City Shenfang Commercial through
Shenzhen Shenzhen 95.00 5.00
Free Trade Trading Ltd. trade establishment or
investment
Acquiring
Shenzhen City Shenfang through
Shenzhen Shenzhen Investment 90.00 10.00
Investment Ltd. establishment or
investment
Beijing fresh peak Acquiring
property development Real estate through
Beijing Beijing 75.00 25.00
management limited operation establishment or
company investment
Guangdong Jianbang Acquiring
Real estate
Group (Huiyang) Industrial Huizhou Huizhou 51.00 through business
operation
Co. Ltd. acquisition
Shenzhen Shenfang Acquired through
Real estate
Chuanqi Real Estate Shenzhen Shenzhen 100.00 establishment or
operation
Development Co. Ltd. investmen
Note：
* In consolidation scope there are five subsidiaries in “revoked but not cancelled” condition: Beijing
SPG Property Management Limited Guangzhou Huangpu Xicun real estate limited company Fresh
Peak Real Estate Dev. Construction (Wuhan) Co. Ltd. and Beijing Shenfang Property Management Co.
150ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Ltd. They are presented on the basis of discontinued operations; these four subsidiaries have made full
provision for impairment of debt for the companies outside the consolidation scope.* The cancelled revoked and closed subsidiaries of the Company that are not included in the scope
of consolidation are as follows:
Principal
Registration Business Shareholding% Acquisitio
Name place of
place nature Direct Indirect metho business
Acquiring through
Shenzhen Shenfang Department Commercial
Shenzhen Shenzhen 95.00 5.00 establishment or
Store Co. Ltd trade
investment
Acquiring through
Commercial
Paklid Limited Hong Kong Hong Kong 60.00 40.00 establishment or
trade
investment
Acquiring through
Bekaton Property Limited Australia Australia Real estate 60.00 -- establishment or
investment
Acquiring through
Canada Great Wall (Vancouver) Canada Canada Real estate -- 60.00 establishment or
investment
Acquiring through
Guangdong Fengkai County Lianfeng Fengkai Fengkai
Manufacturing -- 90.00 establishment or
Cement Manufacturing Co. Ltd. Guangdong Guangdong
investment
Acquiring through
Jiangmen Xinjiang Real Estate Co. Jiangmen Jiangmen
Real estate -- 90.91 establishment or
Ltd Guangdong Guangdong
investment
Acquiring through
Xi‘an Fresh Peak Property Trading Xi‘an
Xi‘an Shanxi Real estate -- 67.00 establishment or
Co. Ltd Shanxi
investment
Acquiring through
Building
Shenxi Limited Shenzhen Shenzhen 70.00 -- establishment or
Decoration
investment
Shenzhen Zhentong New Mechanical Acquiring through
Electromechanical Industry Shenzhen Shenzhen and electrical 95.00 5.00 establishment or
Development Co. Ltd. engineering investment
Shenzhen Real Estate Mechanical Acquiring through
Electromechanical Management Shenzhen Shenzhen and electrical 100.00 -- establishment or
Company Management investment
Acquiring through
Hotel
Shenzhen Nanyang Hotel Co. Ltd. Shenzhen Shenzhen 95.00 5.00 establishment or
Management
investment
Acquiring through
Shenzhen Kangtailong Industrial Industrial
Shenzhen Shenzhen -- 100.00 establishment or
Electric Cooker Co. Ltd. manufacturing
investment
Acquiring through
Shenzhen Longgang Henggang Industrial
Shenzhen Shenzhen -- 79.92 establishment or
Huagang Industrial Co. Ltd. Investment
investment
Note：
1. Shenzhen Shenfang Department Store Co. Ltd called a shareholder meeting on 29 October 2007
decided to terminate the business and establish a liquidation team to conduct the liquidation. The
liquidation team issued a liquidation report on 7 December 2007.
151ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
2. Paklid Limited Bekaton Property Limited and Canada Great Wall (Vancouver) were established by
the group abroad in the early years. On 13 December 2000 the group held a board meeting and
decided to liquidate these three companies. Bekaton Property Limited and Canada Great Wall
(Vancouver) have been winded up.
3. All assets from Guangdong Fengkai County Lianfeng Cement Manufacturing Co. Ltd. (including
tangible and intangible asset) were auctioned by the court on 22 January 2019 becoming a shell
company.
4. Shenxi Limited was a holding subsidiary of Shenzhen Tefa Real Estate Consolidated Services Co.
Ltd. which is a deregistered subsidiary of the group. By the Group‘s announcement ―The notice on the
merger of Shenzhen Zhen Tung Engineering Ltd and Shenxi Limited‖ (Shenfang [1997] No.19)
al businesses form Shenxi Limited were undertaken by Shenzhen Zhen Tung Engineering Ltd and
Shenxi Limited and were revoked on 8 February 2002.The group could no longer effectively control these invested companies which have not been included in
the consolidation scope were either been cancelled or ceased operation many years ago and were no
longer exist. According to ―Accounting Standard for Business Enterprises No. 33-Consolidated Financial
Statements‖ the group already accrued full amount of impairment for the book value of the net
investment in above companies which are not included in the consolidated scope.
(2) Material non-wholly owned subsidiaries
Proportion Profit or loss Dividend Balance of
ofownership allocated to declared to
non-controlling
Name interest held by non-controlling non-controlling
interests as at
non-controlling interests during shareholders
2021.12.31
interests % the year during the year
American Great Wall Co. Ltd 30.00 -129591.94 -- -22288410.51
Xinfeng Investment Co. Ltd. 45.00 513.70 -- -116179873.90
BARENIE CO.Ltd 20.00 -2405.08 -- -3892114.44
Guangdong Jianbang Group
49.00-4010451.30--424661628.82
(Huiyang) Industrial Co. Ltd.
(3 )Key financial information about material non-wholly owned subsidiaries
Ending balance
Name Non-current Current Non-current
Current assets Total assets Total liabilities
assets liabilities liabilities
American
Great Wall 157276.13 19242855.50 19400131.63 109489015.64 -- 109489015.64
Co. Ltd
Fresh Peak
investment 220030110.80 -- 220030110.80 254831542.93 -- 254831542.93
Ltd
BARENIE 1046.02 -- 1046.02 32920988.91 -- 32920988.91
CO.Ltd
Guangdong
Jianbang
Group 1468798461.17 5502260.78 1474300721.95 1489943392.55 53885.23 1489997277.78
(Huiyang)
Industrial
Co. Ltd.
152ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Continued(1)：
Ending balance of the previous year
Name Non-current Non-current
Current assets Total assets Current liabilities Total liabilities assets liabilities
American Great
585669.0617615753.0718201422.1399105956.86--99105956.86
Wall Co. Ltd
Fresh Peak
4748.0736016.9040764.97258219487.07--258219487.07
investment Ltd
BARENIE
957.41--957.4132908874.92--32908874.92
CO.Ltd
Guangdong
Jianbang Group
(Huiyang) 1190571804.12 3795473.63 1194367277.75 1201698603.08 125920.77 1201824523.85
Industrial Co.Ltd.Continued(2)：
Current amount Amount of previous period
Total Cash flows Cash flows
Name Total Operating comprehen from Operating from
Net profit Net profit comprehens
income sive operating income operating
ive income
income activities activities
Amer ica
n Great
477651.62-431973.10-431973.10-485720.61632524.86-284455.30-284455.30352837.90
Wall Co.Ltd
Fresh
Peak
--1141.561141.56----3056.24-3056.24-20.98
investme
nt Ltd
Baiwei
Real
---12025.38-12025.38----13464.76-13464.76-28.15
Estate
Co. Ltd.Guangdo
ng
Jianbang
Group
---8184594.48-8184594.48-158541081.30--6368214.03-6368214.03-748387911.00
(Huiyang
)
Industrial
Co. Ltd.
2. Interests in joint ventures or associates
（1） Summarised financial information of immaterial joint ventures and associates:
As at/Year ended As at/Year ended
Item
2022.12.312021.12.31
Joint ventures:
Aggregate carrying amount of investments -- --
Aggregate amount of share of -- --
Net profit -- --
Other comprehensive income -- --
Total comprehensive income -- --
Associates：
Aggregate carrying amount of investments 93927.67 272168.28
153ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
As at/Year ended As at/Year ended
Item
2022.12.312021.12.31
Aggregate amount of share of
Net profit -178240.64 -105321.37
Other comprehensive income -- --
Total comprehensive income -- --
（2） Excess loss from joint ventures or associates
Accumulated Unrecognized loss Accumulated
Investee unrecognized loss in (or share of net unrecognized loss as at
prior periods profit)for the year 2021.12.31
Shenzhen Fresh Peak property
2217955.89--2217955.89
consultant Co. Ltd
Note:
Shenzhen Fresh Peak property consultant Co. Ltd was established on 15 March 1993 with registered
capital of CNY 3000000. The group subscribed CNY 600000 (20% in total capital). As at 31
December 2021 the actual investment is CNY 600000 the Company has recognized long-term equity
invent lose for CNY 600000.VIII. Risk Management of Financial Instruments
The Group's main financial instruments include the monetary funds notes receivable other receivables
trading financial assets other current assets accounts receivable other equity instrument investments
accounts payable other payables short-term borrowing long-term payables. Details of the various
financial instruments are disclosed in the relevant notes. The risks associated with these financial
instruments and the risk management policies adopted by the Group to mitigate these risks are
described below. The management of the Group manages and monitors these exposures to ensure that
these risks are contained within the limits specified.
1. Risk management objectives and policies
The Group's goal in risk management is to strike an appropriate balance between risks and benefits
and strive to reduce the adverse impact of financial risks on the Group's financial performance. Based
on this risk management objective the Group has developed a risk management policy to identify and
analyze the risks faced by the Group set an appropriate acceptable risk level and design the
corresponding internal control procedures to monitor the risk level of the Group. The Group regularly
reviews these risk management policies and the relevant internal control systems to adapt to market
conditions or changes in the Group's business activities. The Group's internal audit department also
regularly or randomly checks whether the implementation of the internal control system complies with
the risk management policy.The main risks arising from the Group's financial instruments are credit risk liquidity risk market risk
(including exchange rate risk interest rate risk and commodity price risk).The Board of Directors is responsible for planning and establishing the Group's risk management
structure formulating the Group's risk management policies and relevant guidelines and overseeing the
implementation of risk management measures. The Group has developed risk management policies to
identify and analyze the risks faced by the Group. These risk management policies clearly stipulate
specific risks covering market risk credit risk liquidity risk management and many other aspects. The
154ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Group regularly evaluates changes in the market environment and the Group's business activities to
determine whether to update its risk management policies and systems.The Group diversifies the risks of financial instruments through appropriate diversification of its portfolio
of investments and businesses and reduces the risk of concentration in a single industry a specif ic
region or a specific counterparty through the development of appropriate risk management policies.
（1） Credit risk
Credit risk refers to the risk of financial loss to the Group result ing from the failure of the counterparty to
fulfill its contractual obligations.The Group manages credit risks according to portfolio classification. Credit risks mainly arise from bank
deposits notes receivable accounts receivable other receivables.The Group's bank deposits are mainly held in state-owned banks and other large and medium-sized
listed banks (or mainly in financial institutions with good reputations and high credit ratings) and the
Group does not expect that the bank deposits will pose a significant credit risk.For notes receivable accounts receivable other receivables and long-term receivables the Group sets
policies to control credit risk exposure. The Group evaluates customers' credit qualifications and sets
credit periods based on their financial status credit history and other factors such as current market
conditions. The Group will regularly monitor the credit records of customers. For customers with poor
credit records the Group will use written methods to urge payment shorten the credit period or cancel
the credit period to ensure that the overall credit risk of the Group is within a controllable range.The debtors of the Group's accounts receivable are customers distributed in different industries and
regions. The Group continuously conducts credit assessments on the financial posit ion of accounts
receivable and where appropriate takes out credit guarantee insurance.The maximum credit risk exposure of the Group is the carrying amount of each financial asset on the
balance sheet. The Group does not provide any other security which may expose the Group to a credit
risk.Of the Group's accounts receivable the accounts receivable of the top five customers account for 55.65%
of the Group's total accounts receivable (in 2021: 56.87%); Among other receivables of the Group other
receivables from the top five companies in arrears amount to 58.72% (2021: 63.70%) of the total
amount of other receivables of the Group.
（2） Liquidity risk
Liquidity risk refers to the risk that the Group will encounter a shortage of funds when fulf illing its
obligations to settle by delivering cash or other financial assets.In managing liquidity risks the Group maintains and monitors cash and cash equivalents deemed
sufficient by the management to meet the operational needs of the Group and to reduce the impact of
cash flow fluctuations. The Group's management monitors the use of bank borrowings and ensures
compliance with borrowing agreements. It also secured a commitment from major financial institutions
to provide adequate standby funds to meet short - and long-term funding needs.
155ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
The Group finances its working capital through funds generated from its operations and bank and other
borrowings. As at 31 December 2022 the Group's unutilized bank loan amount is CNY 439.71 million
(31 December 2021: CNY 0 million).
At the end of the period the maturity analysis of the financial assets financial liabilities and off -balance
sheet guarantee items held by the Group according to the undiscounted remaining contract cash flow is
as follows (unit: CNY 10000) :
Ending balance
Item Within one One to Five More than five
Total
year years years
Financial liabilities:
Short-term loans 5113.81 5113.81
Notes payable 42478.79 42478.79
Accounts payable 56761.54 56761.54
Interest payables 618.88 618.88
Other payables 5426.10 5426.10
Liabilities held for sale 5.39 5.39
Guarantees for client 40158.39 40158.39
Total financial liabilities and
150562.90150562.90
contingent liabilities
At the beginning of the period the maturity analysis of the financial assets financial liabilit ies and off -
balance sheet guarantee items held by the Group according to the undiscounted remaining contract
cash flow is as follows (unit: CNY 10000) :
Ending balance of the previous year
Item Within one More than five
One to Five years Total
year years
Financial liabilities:
Short-term loans 5044.01 -- -- 5044.01
Accounts payable 24737.64 -- -- 24737.64
Interest payables 14144.76 -- -- 14144.76
Other payables 1653.53 -- -- 1653.53
Long-term payables 56484.21 -- -- 56484.21
Guarantees for client 5791.56 783.69 -- 6575.25
Liabilities held for sale 39237.82 -- -- 39237.82
Total financial liabilities and -- 147877.22
contingent liabilities 147093.53 783.69
The amount of financial liabilities disclosed in the above table is undiscounted contractual cash flows
and may be different from the carrying amount on the balance sheet.The maximum amount of a guarantee contract that has been signed does not represent the amount to
be paid.
156ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
（3） Market risks
The market risk of financial instruments refers to the risk that the fair value or future cash flow of
financial instruments will fluctuate due to market price changes including interest rate risk exchange
rate risk and other price risks.Interest rate risk
Interest rate risk refers to the risk that the fair value of a financial instrument or future cash flow will
fluctuate due to changes in market interest rates. Interest rate risk can arise from recognized interest-
bearing financial instruments and from unrecognized financial instruments (such as certain loan
commitments).The interest rate risk of the Group mainly arises from long-term bank borrowings. Floating interest rate
financial liabilities expose the Group to cash flow interest rate risk while fixed interest rate financial
liabilit ies expose the Group to fair value interest rate risk. The Group determines the relative proportion
of fixed and floating rate contracts based on prevailing market conditions and maintains an appropriate
mix of fixed and floating rate instruments through regular review and monitoring.During the report ing period the Group operates by its own working capital. As at 31 December 2022
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
Currency risk
The term "exchange rate risk" refers to the risk that the fair value of a financial instrument or future cash
flow will fluctuate due to changes in foreign exchange rates. Exchange rate risk can arise from financia l
instruments denominated in a foreign currency other than the standard currency.Exchange rate risk is mainly the Group's financial position and cash flows are affected by foreign
exchange rate fluctuations. In addition to the subsidiary established in Hong Kong holding assets in
Hong Kong dollar as the settlement currency only a small amount of Hong Kong market investment
business the group's foreign currency assets and liabilities accounted for the overall assets and
liabilit ies of the proportion is not significant. Therefore the Group believes that the exchange rate risk is
not significant.
2. Capital management
The objective of the Group's capital management policy is to ensure that the Group can continue as a
going concern thereby providing a return to shareholders and benefiting other stakeholders while
maintaining an optimal capital structure to reduce the cost of capital.In order to maintain or adjust its capital structure the Group may adjust its financing method adjust the
amount of dividends paid to shareholders return capital to shareholders issue new shares and other
equity instruments or sell assets to reduce its debt.The Group monitors the capital structure on the basis of the debt-to-asset ratio (i.e. total liabilities
divided by total assets). As at 31 December 2022 the Group's liability to asset ratio was 24.66% (31
December 2021: 31.62%).
157ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
IX. Fair value
The level in which fair value measurement is categorised is determined by the level of the fair value
hierarchy of the lowest level input that is significant to the entire fair value measurement. 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 indirect ly observable for
underlying assets or liabilities.Level 3 inputs: inputs that are unobservable for underlying assets or liabilities.
(1) Items and amounts measured at fair value
At the end of the period the assets and liabilities measured at fair value are listed as follows according
to the above three levels :
The second The first level of The third level of
level of fair
Item fair value fair value Total
value
measurement measurement
measurement
I.Recurring fair value
measurement
(1) Trading financial assets 408154361.42 -- -- 408154361.42
(2) Investment in other equity
----13839235.5713839235.57
instruments
Total assets measured at fair
408154361.42-13839235.57421993596.99
value on a recurring basis
(2) Quantification information of important unobservable input values used in the third level of fair value
measurement
Ending fair Valuation The input value cannot Range (weighted
Within the capacity
value techniques be observed mean)
Equity instrument
investment:：
Net asset Book value of net assets
Non-listed equity 13839235.57 N/A method with discount of liquidity
investments:
(3) Items and amounts that are not measured at fair value but disclose their fair value
The financial assets and financial liabilities of the Group measured at amortized cost mainly include
monetary funds notes receivable accounts receivable other receivables short-term borrowings notes
payable accounts payable other payables etc.Except for the following financial assets and financial liabilities the carrying value of other financial
assets and financial liabilities which are not measured at fair value varies very little from fair value.X. Related parties and related party transactions
1. Information about the parent of the Group
158ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Registered Percentage of
Registration Business Shareholding
Name capital voting
place nature percentage %
(CNY0000) rights %
Investment
Shenzhen
Shenzhen Investment real estate
Guangdong 2800900.00 55.78 55.78
Holdings Co. Ltd. development
province
guarantee
The ultimate controlling party of the Group is State-owned Assets Supervision and Management
Commission of Shenzhen Municipal People‘s Government.In the reporting period the changes in the registered capital of the parent company are as follows:
Opening balance Accrued during the year Decreased during the year Ending balance
2800900.00----2800900.00
2. Information about the subsidiaries of the Group
For information about the subsidiaries of the Group refer to NoteⅦ.1
3. Information about the joint ventures and associates of the Group
For information about the joint ventures and associates of the Group refer to NoteⅦ.2
4. Information on other related parties
Name Related party relationship
Shenzhen Jian ?an Group Co. Ltd. Both controlled by the parent company
Shenzhen Dongfang New world store Co.Participating stock companies
Ltd.Not included in Consolidated Financial Statements‘ Subsidiary that
Shenxi Limited
had been terminated its licenses by law but not cancellation
Shenzhen Zhentong New Electromechanical Not included in Consolidated Financial Statements‘ Subsidiary
Industry Development Co. Ltd. (Long-term without operation)
Not included in Consolidated Financial Statements‘ Subsidiary that
Shenzhen Nanyang Hotel Co. Ltd.had been terminated its licenses by law but not cancellation
Shenzhen Real Estate Electromechanical Not included in Consolidated Financial Statements‘ Subsidiary that
Management Company had been terminated its licenses by law but not cancellation
Shenzhen Longgang Henggang Huagang Not included in Consolidated Financial Statements‘ Subsidiary that
Industrial Co. Ltd. had been terminated its licenses by law but not cancellation
Guangzhou Bobi Enterprise Management Shareholder of Guangdong Jianbang Group (Huiyang) Industrial
Consulting Co. Ltd. Co. Ltd.Directors Supervisors CFO and Board
Key management personnel
secretary
Shenzhen Property Management Co. Ltd. Both controlled by the parent company
Guoren Property Insurance Co. Ltd. Both controlled by the parent company
Shenzhen Water Planning & Design Institute
Both controlled by the parent company
Co. Ltd.Shenzhen General Institute of Architectural
Both controlled by the parent company
Design and Research Co. Ltd.
159ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
5. Transactions with related parties
(1) Purchases/sales
* Purchase of goods/receiving of services
Nature of Amount of previous
Related party Current amount
transaction period
Foundation pit support
Shenzhen Water Planning & Design
design of Shenfang 554056.60 --
Institute Co. Ltd.Guangmingli project
Construction
Shenzhen General Institute of
engineering design of
Architectural Design and Research Co. 5329811.33 --
Shenfang
Ltd.Guangmingli project
Guoren Property Insurance Co. Ltd. Insurance services 283018.87 --
Shenzhen Property Management Co.Property service 11530169.32 --
Ltd.Shenzhen Shenfang Property Cleaning
Cleaning service 459622.70 --
Co. Ltd.Shenzhen Property Management Co.Property service 2.668.895.66 --
Ltd. Shantou branch
Elevator
Shenzhen RongHua JiDian Co. Ltd -- 1329886.76
maintenance
* Sales of goods/rendering of services
Nature of Amount of previous
Related party Current amount
transaction period
Shenzhen Jian'an Group Co. Ltd. Decoration services -- 7614678.90
Shenzhen RongHua JiDian Co. Ltd Property Services -- 68772.00
Guoren Property Insurance Co. Ltd. Leasing services 812102.75 --
Shenzhen Property Management Co.Leasing services 4290671.33 --
Ltd.Shenzhen Shenfang Property Cleaning
Leasing services 37142.83 --
Co. Ltd.
(2) Lease
* The Group acts as the lessor
Rental income
Rental income recognized
Name of the lessee Types of leased assets recognized in the current
in the previous period
period
Shenzhen Property
Management Co. Buildings 4290671.33 --
Ltd.Shenzhen Shenfang
Property Cleaning Buildings 37142.83 --
Co. Ltd.Guoren Property
Buildings 812102.75 --
Insurance Co. Ltd.
160ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
(3) Funding from related party
Amount of
Related party Inception date Maturity date Note
funding
Funds received
The principal of the loan
was repaid on 22
Shenzhen Investment 22 December
16535277.94 9 November 2006 December 2016 and the
Shareholding Co. Ltd 2016
remaining amount is
interest payable.Guangzhou Bopi The amount of interest to
Enterprise Management 170979386.21 20 May 2020 20 May 2023 be charged is CNY
Consulting Co. Ltd. 32285879.29
Note: at the end of the reporting period the balance of interest on loan to Shenzhen Investment Holding
Co. Ltd. is CNY 16535277.94 and the amount of principal and interest payable to Guangzhou Bopi
Enterprise Management Consulting Co. Ltd. is CNY 203265265.50.
(4) Assets Transfer and debt restructuring
Amount of
Related party Nature of transaction Current amount
previous period
Shenzhen Guomao Real Estate
Transfer the property company 196676700.00 --
Management Co. Ltd.
(5) Remuneration of key management personnel
The Group has 10 key management personnel in 2021 and 13 key management personnel in 2020.Information about remuneration is as follows:
Current amount Amount of previous period
Item（In ten thousand） （In ten thousand）
Remuneration of key management personnel 812.36 844.64
（6）In order to encourage the core employees of the group to share the operating results of the
market-oriented projects with the company share the operating risks stimulate the endogenous
motivation of improving efficiency and increasing benefits enhance the efficiency of asset management
and realize the preservation and appreciation of the value of state-owned assets the company has
formulated the "Management Measures for Investment From the Staff of Shenfang Group Linxi Jun
Project". According to the above-mentioned management measures the related party transactions will
form a joint investment with some directors supervisors and senior executives of the company. As of 31
December 2022 the company's directors supervisors and senior executives had invested a total of
CNY 8.95 million.
6. Receivables from and payables to related parties
(1) Receivables from related parties
161ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Ending balance Ending balance of previous year
Provision for Provision for
Item Related party bad and bad and
Book value Book value
doubtful doubtful
debts debts
Shenzhen Fresh Peak
Accounts
property consultant Co. 1201345.82 1201345.82 1118383.88 1118383.88
receivable
Ltd
Guangdong Province
Other
Huizhou Luofu Hill 10465168.81 10465168.81 10465168.81 10465168.81
receivables
Mineral Water Co. Ltd
Shenzhen Runhua
Other
Automobile Trading Co. 3072764.42 3072764.42 3072764.42 3072764.42
receivables
Ltd
Other Canada GreatWall
89035748.0789035748.0789035748.0789035748.07
receivables (Vancouver) Co. Ltd
Other Australia Bekaton
12559290.5812559290.5812559290.5812559290.58
receivables Property Limited
Other
Bekaton Property Limited 18689545.58 18870785.54 18689545.58 18870785.54
receivables
Shenzhen Shenfang
Other
Department Store Co. 237648.82 237648.82 237648.82 237648.82
receivables
Ltd.Other Shenzhen RongHua
475223.46475223.46475223.46475223.46
receivables JiDian Co. Ltd
Xi‘an Fresh Peak property
Other
management& Trading 8419205.19 8419205.19 8419205.19 8419205.19
receivables
Co. Ltd
Shenzhen Shenxi
Other
Architectural Decoration 7660529.37 7660529.37 7660529.37 7660529.37
receivables
Company
Other Shenzhen Jian'an Group
3168721.003168721.003168721.003168721.00
receivables Co. Ltd.
（2）Payables to related parties
Ending
Item Related party Ending balance balance of
previous year
Interest payables Shenzhen Investment Shareholding Co. Ltd 16535277.94 16535277.94
Accounts payable Shenzhen Jian'an Group Co. Ltd. 10654310.21 25576607.95
Accounts payable Shenzhen Property Management Co. Ltd. 11053366.80 --
Other payables Shenzhen Dongfang New world store Co. Ltd 902974.64 902974.64
Guangdong Province Fengkai Lain Feng Cement
Other payables 1867348.00 1867348.00
Manufacturing Co. Ltd.Shenzhen Real Estate Electromechanical
Other payables 14981420.99 14981420.99
Management Company
Shenzhen Zhentong New Electromechanical
Other payables 8310832.50 8827940.07
Industry Development Co. Ltd.Other payables Shenzhen Shenfang Department Store Co. Ltd. 639360.38 639360.38
Shenzhen Longgang Henggang Huagang
Other payables 165481.09 165481.09
Industrial Co. Ltd.Interest payables Shenzhen Investment Shareholding Co. Ltd 203345881.60 193016852.52
162ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
XI. Commitments and contingencies
1. Significant commitments
(1) Capital commitments
Capital commitments entered into but not
Ending balance Ending balance of previous year
recognized in the financial statements
Material sales or purchases contracts 328654477.52 475137087.80
As at 31 December 2022 there is no other commitment to be disclosed.
2. Contingencies
(1) Contingent liabilities arising from pending arbitration and pending litigation and related financial
impact
Amount of the
Appellate Progress of
Plaintiff Defendant Case object of
court cases
action
Xi'an Commercial
Xi‘an Fresh Peak and Trade Investment CNY 36.62
Shaanxi Higher
Holding limited Commission Xi'an compensation million and Pending
People's Court
company Commerce and disputes interest
Tourism Co. Ltd.Xi‘an Fresh Peak Holding limited company (hereinafter referred to as ―Fresh Peak Company‖ ) was
Sino-foreign joint venture set up in Xi‘an. 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 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 CNY 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.By auctioning assets of Business Tourism Company the amount of CNY 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 until 31 December 2022.As at 31 December 2022 the book value of the long-term equity investment of Xi‘an Fresh Peak
Company is CNY 32840729.61. The book balance of assets was CNY 8419205.19. Both have been
taken full provision for impairment loss
163ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Amount of
Appellate Progress of
Plaintiff Defendant Case the object of
court cases
action
Huizhou Mingxiang
Economic The principal
Information Bill amount is
Consulting Co. Ltd.Guangdong Jianbang payment Huiyang CNY
Huizhou Huiyang
Group (Huiyang) claim District 177151400 Unsentenced
Hongfa Industry and
Industrial Co. Ltd. dispute People's Court with interest
Trade Co. Ltd.litigation of CNY
Huizhou
2848200
Jinlongsheng
Industrial Co. Ltd.Guangdong Jianbang Group (Huiyang) Industrial Co. Ltd.（hereinafter referred to as "JianbangCompany"） is a subsidiary of the Group holding 51% of the shares. Because Jianbang Company was
unable to honor the commercial acceptance bill due in January 2022 with a total amount of CNY
177151400.00 the plaintiff company filed a lawsuit against the Huiyang District People's Court for the
dispute of bill payment claim. At present the court has not yet ruled. Shenfang Group and Jianbang are
negotiating a package solution with the plaintiff.Contingent liabilities arising from guarantee provided to
other entities and related financial effects.
(2) Contingent liabilities arising from guarantee provided to other entities and related financial effects
As at 31 December 2022 the Group provides commercial housing purchaser with guarantees at CNY
401583900.00 for the following loans:
Amount (In ten
Item Duration Note
thousand)
Until the Premises Permit mortgage
ShangLin Building 107.49
registration is finished and in bank custody
Until the Premises Permit mortgage
Shengfang CuiLin Building 2174.37
registration is finished and in bank custody
ChuanQi DongHu Building (Former Until the Premises Permit mortgage
1820.33
DongHuDiJing Building) registration is finished and in bank custody
Until the Premises Permit mortgage
TianYue Bay 36056.20
registration is finished and in bank custody
Total 40158.39(3) Other contingencies（Not including contingent liabilities that are highly unlikely to result in anoutflow of economic benefits from the business）
For information about contingency of joint venture or joint venture investment refer to Note VII 2. (2).As at 31 December 2022 there is no other contingency to be disclosed.XII. Post balance sheet date events
1. Profit appropriations plans after the balance sheet date
The company intends to pay a cash dividend of CNY 0.61(including tax) totaling CNY60699600.00 to
all shareholders on 61711260.00 shares as at 31 December 2022.
164ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
XIII. Other significant items
1. Termination of operation
Amount of previous
Item Current amount
period
Income from Termination of Operations (A) 24974689.94 163141074.63
Less: termination expenses (B) 11143092.65 160034977.84
Gross profit from terminated operations (C) 12867988.21 4470327.62
Minus: Income tax expense for termination of
3222830.801123400.14
operations (D)
Net profit from operating activities (E=C-D) 9645157.41 3346927.48
Impairment loss on assets/(reverse) (F) -- --
Gross disposal proceeds (G) -- --
Disposal of related income tax expense (H) -- --
Net profit on disposal (I= g-h) -- --
Net profit from terminated operations (J=E+F+I) 9645157.41 3346927.48
Including: profit from terminated operations
9645157.413346927.48
attributable to shareholders of the parent company
Termination profit attributable to minority
----
shareholders
Net cash flow from operating activities -7047804.38 -3487467.47
Net cash flow from investment activities -5980.00 -528491.28
Net cash flow from financing activities -- --
Note: The above items are the financial data of Shenzhen Property Management Co. Ltd. Ltd. in
January 2022.XIV. Notes for main items in the parent company's financial statements
1. Accounts Receivable
(1) Disclosed by aging
Aging Ending balance Ending balance of previous year
Within one year 12426543.02 9893622.09
One to two years -- --
Two to three years -- --
More than three years 9653566.27 9710249.94
Subtotal 22080109.29 19603872.03
Less: bad debt provision 10373431.08 9895586.10
Total 11706678.21 9708285.93
165ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
(2) Disclosed by categories
Ending balance
Item Book balance Bad debt provision
Provision Book value
Amount Proportion Amount
proportion
Bad debt provisions made on
10020587.9145.3810020587.91100.00--
an individual basis
Bad debt provisions made on
12059521.3854.62352843.172.9311706678.21
a combination basis
Including：
Receivables from related
parties within consolidated 5002657.79 22.66 -- -- 5002657.79
scope
Receivables from other
7056863.59 31.96 352843.17 5.00 6704020.42 customers
Total 22080109.29 100.00 10373431.08 46.98 11706678.21
Continued：
Ending balance of previous year
Item Book balance Bad debt provision
Provision Book value
Amount Proportion Amount
proportion
Bad debt provisions made on
9649415.2049.229649415.20100.00--
an individual basis
Bad debt provisions made on
9954456.8350.78246170.902.479708285.93
a combination basis
Including： -- -- -- -- --
Receivables from related
parties within consolidated 5031038.74 25.67 -- -- 5031038.74
scope
Receivables from other
4923418.09 25.11 246170.90 5.00 4677247.19 customers
Total 19603872.03 100.00 9895586.10 50.48 9708285.93
Bad debt provision made on an individual basis:
Ending balance
Item Expected credit Reason
Book balance Bad debt provision
loss rate (%)
long-term accounts
Uncollected is
receivable from property 10020587.91 10020587.91 100.00
expected
sales
Continued：
Ending balance of previous year
Item Expected credit Reason
Book balance Bad debt provision
loss rate (%)
long-term
accounts Uncollected is
9649415.209649415.20100.00
receivable from expected
property sales
166ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Bad debt provision made on a combination basis:
Combined withdrawal item: related parties in consolidation scope
Ending balance Ending balance of previous year
Aging Expected Expected Accounts Bad debt Accounts Bad debt
credit loss credit loss
receivable provision receivable provision
rate (%) rate (%)
Within 1 year 5002657.79 -- -- 5031038.74 -- --
Combined withdrawal item: receivables from other customers
Aging Ending balance Ending balance of previous year
Expected Expected
Accounts Bad debt Accounts Bad debt
credit loss credit loss
receivable provision receivable provision
rate (%) rate (%)
Within 1 year 7056863.59 352843.17 5.00 4923418.09 246170.90 5.00
(3) Additions recoveries or reversals of provision for the current period
Bad debt provision
Opening balance 9895586.10
Additions 477844.98
Recoveries or reversals --
Written-off --
Other --
Ending balance 10373431.08
(4) The top five units with the ending balance of accounts receivable collected by the debtor
% of the total
Accounts receivable Bad debt provision
Name of the entity closing balance of
The ending balance The ending balance
accounts receivable
Shenzhen Petrel Hotel Co. Ltd. 5002657.79 22.66 --
Daxing Automotive parts Co. Ltd. 2029665.76 9.19 2029665.76
Shenzhen Xinfeng Real Estate
1201345.825.441201345.82
Consulting Co. Ltd.Weidong Wang 1200000.00 5.43 1200000.00
Guodong Wang 900761.86 4.08 900761.86
Total 10334431.23 46.80 5331773.44
2. Other receivables
Item Ending balance Ending balance of previous year
Interest receivable --
Dividends receivable 39222722.88 --
Other receivables 1672657609.57 1587300891.76
Total 1711880332.45 1587300891.76
167ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
(1) Dividends receivable
Name of the invested entity Ending balance Ending balance of previous year
Shenzhen City SPG Long Gang Development Ltd. 39222722.88 --
Subtotal 39222722.88 --
Less: bad debt provision -- --
Total 39222722.88 --
At the end of the period the Group has no significant dividends receivable with an account age of more
than 1 year.
(2) Other receivables
Disclosure by aging
Aging Ending balance Ending balance of previous year
Within 1 year 347340209.70 568919874.78
1 to 2 years 475880860.11 209903464.26
2 to 3 years 105934643.85 78698092.26
More than 3 years 1544673561.96 1522297306.33
Subtotal 2473829275.62 2379818737.63
Less: bad debt provision 801171666.05 792517845.87
Total 1672657609.57 1587300891.76
Disclosure by nature
Ending balance Ending balance of previous year
Item Bad debt Bad debt
Book balance Book Value Book balance
provision provision Book Value
Other receivables
from the collecting
61133.60--61133.60203659.15--203659.15
and paying on
behalf
Other receivables
from other 7106322.88 3506320.84 3600002.04 4801159.55 4056565.36 744594.19
customers
Other receivables
from related 137686536.98 137686536.98 -- 137211313.52 137211313.52 --
parties
Other receivables
in consolidation 2328975282.16 659978808.23 1668996473.93 2237602605.41 651249966.99 1586352638.42
scope
Total 2473829275.62 801171666.05 1672657609.57 2379818737.63 792517845.87 1587300891.76
Bad Debt Provision
At the end of the period bad debt provision at the first stage:
Expected
credit loss rate Bad debt
Types Book balance Book value Reason
over the next provision
12 months (%)
Bad debt provisions
made on an individual -- -- -- --
basis
168ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Expected
credit loss rate Bad debt
Types Book balance Book value Reason
over the next provision
12 months (%)
Bad debt provisions
made on a combination 3839962.00 4.66 178826.36 333641.16
basis
Other receivables from
the collecting and 39400.00 -- -- 39400.00
paying on behalf
Other receivables from
21733.60----21733.60
other customers
Other receivables from
3778828.404.73178826.363600002.04
related parties
Total 3839962.00 4.66 178826.36 3661135.64
At the end of the period bad debt provision at the second stage:
Expected credit
loss rate over Bad debt
Types Book balance Book value Reason
the next 12 provision
months (%)
Bad debt provisions made Could be
--------
on an individual basis uncollectible
Bad debt provisions made Could be
2328975282.1628.34%659978808.231668996473.93
on a combination basis uncollectible
Other receivables in Could be
2328975282.1628.34%659978808.231668996473.93
consolidation scope uncollectible
Could be
Total 2328975282.16 28.34% 659978808.23 1668996473.93
uncollectible
At the end of the period bad debt provisions at the third stage:
Expected
credit loss rate Bad debt
Types Book balance Book value Reason
over the next provision
12 months (%)
Bad debt provisions
made on an individual -- -- -- --
basis
Bad debt provisions 141014031.46 100.00 141014031.46 --
made on a combination
basis
Other receivables from Could be
137686536.98100.00137686536.98--
other customers uncollectible
Other receivables from Could be
3327494.48100.003327494.48--
related parties uncollectible
Could be
Total 141014031.46 100.00 141014031.46 --
uncollectible
169ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
At the end of previous period bad debt provision at the first stage:
Expected credit
loss rate over Bad debt
Types Book balance Book value Reason
the next 12 provision
months (%)
Bad debt provisions
made on an individual -- -- -- --
basis
Bad debt provisions
made on a combination 987442.51 3.97 39189.17 948253.34
basis
Other receivables from
--------
government
Other receivables from
the collecting and paying 203659.15 -- -- 203659.15
on behalf
Other receivables from
783783.365.0039189.17744594.19
other customers
Total 987442.51 3.97 39189.17 948253.34
At the end of previous period bad debt provisions at the second stage:
Expected
credit loss
Bad debt
Types Book balance rate over the Book value Reason
provision
next 12
months (%)
Bad debt provisions made
--------
on an individual basis
Bad debt provisions made Could be
2237602605.4129.10651249966.991586352638.42
on a combination basis uncollectible
Other receivables in Could be
2237602605.4129.10651249966.991586352638.42
consolidation scope uncollectible
Total 2237602605.41 29.10 651249966.99 1586352638.42
At the end of previous period bad debt provisions at the third stage:
Expected credit
Bad debt
Types Book balance loss rate over Book value Reason
provision
entire duration (%)
Bad debt provisions
made on an individual -- -- -- --
basis
Bad debt provisions --
made on a combination 141228689.71 100.00 141228689.71
basis
receivables from other Could be
4017376.19100.004017376.19--
customers uncollectible
receivables from related Could be
137211313.52100.00137211313.52--
parties uncollectible
Total 141228689.71 100.00 141228689.71 --
Bad debt provisions in the current period
170ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
The first stage The second stage The third stage
Expected Expected credit losses Expected credit loss
Bad debt provision credit losses over the entire duration over the entire duration Total
over the next (no credit impairment (credit impairment has
12 months occurred) occurred)
Balance as at
39189.17651249966.99141228689.71792517845.87
December 31 2021
The opening balance
--------
in the current period
Shift to the second
--------
stage
Shift to the third
--------
stage
Turn back to the
--------
second stage
Turn back to the first
--------
stage
Current period 139637.19 139637.19
Current roll-back -- -- 214658.25 214658.25
Current Resale -- -- -- --
This verification -- -- -- --
Other changes -- -8728841.24 -- -8728841.24
Balance as of
178826.36659978808.23141014031.46801171666.05
December 31 2021
Note：Other changes were mainly due to the exchange rate movements.The top five units of ending balance of other receivables
Proportion of total Ending balance Ending
Nature of other ending balance of
Name of the entity of other Aging balance of bad
receivables other receivables
receivables debt provision
(%)
Huafeng Real Estate Receivables from 756160642.87 1 to 3 years more 30.57 --
Devepment Co. Ltd subsidiary than 3 years
Guangdong Jianbang
Receivables from
Group (Huiyang) Industrial 766912600.18 Within 2 years 31.00 --
subsidiary
Co. Ltd.Xinfeng enterprise Limited. Receivables from 523734882.60 Within 2 years 21.17 508377320.74
subsidiary more than 5 years
American Great Wall Co. Receivables from 103231257.70 More than 5 years 4.17 103231257.70
Ltd. subsidiary
Xinfeng Real Estate Co. Receivables from 90213483.43 Within 3 years 3.65 --
Ltd. subsidiary
Total 2240252866.78 90.56 611608578.44
171ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
3. Long-term equity investment
Ending balance Ending balance of previous year
Item
Book balance Impairment loss The book value Book balance Impairment loss The book value
Invest in subsidiaries 1716020833.00 133839271.15 1582181561.85 1735224157.90 152839271.15 1582384886.75
Investment in joint ventures 9455465.38 9455465.38 -- 9455465.38 9455465.38 --
Invest in associated enterprises 2616307.84 2522380.20 93927.64 2794548.48 2522380.20 272168.28
Total 1728092606.22 145817116.73 1582275489.49 1747474171.76 164817116.73 1582657055.03
(1) Invest in subsidiaries
Provision for
Increase in Impairment loss
Investee unit Opening balance The reduced Ending balance impairment in the
current The ending balance
current period
Shenzhen Property Management Co. Ltd. -- -- --
Shenzhen Petrel Hotel Co. Ltd. 20605047.50 20605047.50 -- --
Shenzhen City Shenfang Investment Ltd. 9000000.00 9000000.00 -- --
Xinfeng enterprise Limited. 556500.00 556500.00 -- --
Xinfeng Real Estate Co. Ltd. 22717697.73 22717697.73 -- --
Shenzhen Special Economic Zone Real Estate (Group)
19000000.0019000000.00------
Guangzhou Property and Estate Co. Ltd.Shenzhen Zhentong New Electromechanical Industry
11332321.4511332321.45----
Development Co. Ltd.American Great Wall Co. Ltd 1435802.00 1435802.00 -- --
Shenzhen Shenfang Free Trade Co. Ltd. 4750000.00 4750000.00 -- --
Shenzhen Huazhan Construction Supervision Co. Ltd. 6000000.00 6000000.00 -- --
QiLu Co. Ltd. 212280.00 212280.00 -- -- --
Beijing Shenfang Property Management Co. Ltd. 500000.00 500000.00 -- 500000.00
Shenzhen Lianhua Enterprise Co. Ltd. 13458217.05 13458217.05 -- --
Shenzhen Longgang Industrial Co. Ltd. 30850000.00 30850000.00 -- --
172ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Provision for
Increase in Impairment loss
Investee unit Opening balance The reduced Ending balance impairment in the
current The ending balance
current period
Beijing fresh peak property development management
64183888.9064183888.90--64183888.90
limited company
Shantou City Huafeng Real Estate Devepment Co. Ltd 16467021.02 16467021.02 -- --
Bekaton Property Limited 201100.00 201100.00 -- 201100.00
Australia Bekaton Property Limited 906630.00 906630.00 -- 906630.00
Shenzhen Shenfang Department Store Co. Ltd. 9500000.00 9500000.00 -- 9500000.00
ShanTou Fresh Peak Building 58547652.25 58547652.25 -- 58547652.25
Guangdong Jianbang Group (Huiyang) Industrial Co. Ltd. 450000000.00 450000000.00 -- --
Shenzhen Shenfang Chuanqi Real Estate Development
995000000.00995000000.00----
Co. Ltd.Wellam Co. Ltd. 8955.10 8955.10 -- --
Total 1735224157.90 8955.10 19212280.00 1716020833.00 -- 133839271.15
(2) Investment in joint ventures and joint ventures
Change of increase or decrease in current period
Under the Declare Ending balance
Opening bala Other Provision
Investee unit Additional equity method Changes payment of
Ending balan
nce Reduce comprehensive for
of impairment
/new To confirm the in other cash other ce
investment Income impairment provision
investment Investment interests dividends or
adjustment To prepare
profit and loss profits
* joint
ventures
Fengkai Xinhua
9455465.38----------------9455465.389455465.38
Hotel
subtotal 9455465.38 -- -- -- -- -- -- -- -- 9455465.38 9455465.38
* Joint
venture
Shenzhen
1349122.95-----178240.64----------1170882.311076954.64
Ronghua
173ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Change of increase or decrease in current period
Under the Declare
Opening bala Other Provision
Ending balance
Investee unit Additional equity method Changes payment of
Ending balan
Reduce comprehensive for of impairment nce /new To confirm the in other cash other ce
investment Income impairment provision
investment Investment interests dividends or
adjustment To prepare
profit and loss profits
JiDian Co. ltd
Shenzhen
Runhua
1445425.56----------------1445425.561445425.56
Automobile
trading Co. Ltd
subtotal 2794548.51 -- -- -178240.64 -- -- -- -- -- 2616307.87 2522380.20
Total 12250013.89 -- -- -178240.64 -- -- -- -- -- 12071773.25 11977845.58
174ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
4. Operating Income and Operating Costs
Current amount Amount of previous period
Item
Income Cost Income Cost
Main business 207117745.27 66761336.83 774049479.78 198814980.86
Other business 31823.86 -- 16130.55 --
Total 207149569.13 66761336.83 774065610.33 198814980.86
(1) Operating revenue and operating costs are divided by industry
Current amount Amount of previous period
Industry type
income The cost of income The cost of
Real estate 161658149.52 27249452.24 706622743.82 166178270.82
Lease 45459595.75 39511884.59 67426735.96 32636710.04
Total 207117745.27 66761336.83 774049479.78 198814980.86
(2) The revenue and cost of main business shall be divided by region
Current amount Amount of previous period
Main business area Main business Main business Main business Main business
revenue cost revenue cost
Guangdong Province 207117745.27 66761336.83 774049479.78 198814980.86
5. Investment Income
Item Current amount Amount of previous period
Long-term equity investment income calculated
-178240.64-105321.37
by the equity method
Dividend income from investments in other
813960.00692580.00
equity instruments
Investment gains from structured deposit 159619.01 1196580.44
Investment gains from debt restructuring 89607.85 --
Investment gains from disposal of long-term
203360562.19--
equity investment
Long-term equity investment income accounted
76727761.73--
by cost method
Total 280973270.14 1783839.07
XV. Supplementary Information
1. Statement of non-recurring gains and losses for the current period
Item Current amount instructions
Investment gains recognized for
Gains and losses on disposal of illiquid assets 161542599.57
disposal of subsidiary equity in 2022
175ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2022
Item Current amount instructions
Government subsidies included in current profits and
losses (except government subsidies that are closely
related to the normal business of the Group and are
559803.19 Government subsidies
continuously enjoyed in accordance with national
policies and certain standard quota or quantitative
amount)
Changes in fair value and investment
Profit or loss on entrusted investments or assets
9129650.51 income arising from investments in
management
monetary funds
Profit and loss from debt restructuring 2610128.31 Profits from debt restructuring
Other non-operating income and expenses other than
1094190.56
those mentioned above
Total non-recurring gains and losses 174936372.14
Minus: income tax impact of non-recurring gains and 41451680.41
losses
Net non-recurring gains and losses 133484691.73
Minus: impact of non-recurring net gains and losses 926291.27
attributable to minority shareholders (after tax)
Non-recurring gains and losses attributable to 132558400.46
common shareholders of the Group
2. Return on equity and earnings per share
Weighted Average Earnings per share
Profit in reporting period Net Assets Basic earnings per Diluted earnings per
Yield % share share
Net income attributable to the common
shareholders of the Group 3.88% 0.1519 0.1519
Net profit attributable to common
shareholders of a company after
deducting non-recurring gains and losses 0.53% 0.0209 0.0209
176
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