ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
SHENZHEN SPECIAL ECONOMIC ZONE REAL ESTATE &
PROPERTIES (GROUP) CO. LTD.ANNUAL REPORT 2021
March 2022
1ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Part I Important Notes Table of Contents and Definitions
The Board of Directors (or the “Board”) the Supervisory Committee as well as the directors
supervisors and senior management of ShenZhen Special Economic Zone Real Estate &
Properties (Group) Co. Ltd. (hereinafter referred to as the “Company”) hereby guarantee the
factuality accuracy and completeness of the contents of this Report and its summary and
shall be jointly and severally liable for any misrepresentations misleading statements or
material omissions therein.Liu Zhengyu chairman of the Company’s Board 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 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.Risks facing the Company have been explained in detail in “XI Prospects” in “Part IIIManagement Discussion and Analysis” herein.The Board has approved a final dividend plan as follows: based on the total share capital of
1011660000 shares a cash dividend of RMB0.88 (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 2021
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 ........ 11
Part IV Corporate Governance ....................... 41
Part V Environmental and Social Responsibility ..... 66
Part VI Significant Events ......................... 68
Part VII Share Changes and Shareholder Information.. 77
Part VIII Preferred Shares ......................... 84
Part IX Bonds ...................................... 85
Part X Financial Statements ........................ 86
3ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Documents Available for Reference
1. The financial statements with the personal signatures and stamps of the Company’s legal
representative 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 2021
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.The “Company” the “Group” “SPG” or “we”
and 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 2021
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@163.net
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@163.net spg@163.net
III Media for Information Disclosure and Place where this Report Is Lodged
Stock exchange website where this Report is disclosed S henzhen Stock Exchange (http://www.szse.cn/)
6ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Domestic: Securities Times China Securities Journal and
Newspaper and website where this Report is disclosed h ttp://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 (unified social credit code)
Change to principal activity of the
No change
Company since going public (if any)
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
2021-over-2020
202120202019
change (%)
Operating revenue (RMB) 1320790648.45 1615009713.88 -18.22% 2548740319.49
Net profit attributable to the listed 220836309.93 290229772.23 -23.91% 552452307.59
company’s shareholders (RMB)
Net profit attributable to the listed 208306710.37 253595334.11 -17.86% 524204812.66
company’s shareholders before
exceptional gains and losses (RMB)
Net cash generated from/used in -1205952107.94 285164013.17 -522.90% 603607724.75
7ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
operating activities (RMB)
Basic earnings per share (RMB/share) 0.2183 0.2869 -23.91% 0.5461
Diluted earnings per share 0.2183 0.2869 -23.91% 0.5461
(RMB/share)
Weighted average return on equity 5.72% 7.81% -2.09% 15.90%
(%)
Change of 31
December 2021 over
31 December 2021 31 December 2020 31 December 2019
31 December 2020
(%)
Total assets (RMB) 6182498050.43 4936916746.74 25.23% 4909669536.09
Equity attributable to the listed 3938260291.97 3797512488.22 3.71% 3666874569.99
company’s 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
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
2021 2020 Ending amount Beginning amount
Under CAS 220836309.93 290229772.23 3938260291.97 3797512488.22
Adjusted as per IFRS
Under IFRS 220836309.93 290229772.23 3938260291.97 3797512488.22
8ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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 415282352.53 279315865.94 272065605.11 354126824.87
Net profit attributable to the listed
88040167.6044406954.5429640906.7058748281.09
company’s shareholders
Net profit attributable to the listed
company’s shareholders before 87395877.39 44042111.19 29576289.10 47292432.69
exceptional gains and losses
Net cash generated from/used in
303456191.73-588996943.19-978555623.0958144266.61
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 2021 2020 2019 Note
Gain or loss on disposal of non-current
assets (inclusive of impairment allowance -13451.61 11429.23
write-offs)
Government subsidies charged to current
profit or loss (exclusive of government
subsidies consistently given in the
1669479.403370769.211168127.90
Company’s ordinary course of business at
fixed quotas or amounts as per government
policies or standards)
Gain or loss on assets entrusted to other 13024710.91 15217058.60 31425651.98 Purchase of currency
9ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
entities for investment or management fund
Reversed portions of impairment allowances
for receivables which are tested individually 482790.04
for impairment
Non-operating income and expense other
1542604.0129009657.601118861.69
than the above
Other gains and losses that meet the
1237002.86
definition of exceptional gain/loss
Interest income from undue structured
3950685.00
deposits
Less: Income tax effects 4176533.19 12211479.38 9415831.64
Total 12529599.56 36634438.12 28247494.93 --
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.
10ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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.In order to achieve the central government's target of stabilizing land and housing prices as well as market
expectations real estate regulators have successfully implemented a series of policies including "three red lines"
real estate loan concentration management mechanism in 2020 and "concentrated supply of land" in 2021. These
policies resulted in a significant difference between different districts in the same city and an overall stable and
slow trend in nationwide real estate market.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 Regulatory
Guideline No. 3 of the Shenzhen Stock Exchange for Listed Companies—Industry-specific Information Disclosure.The Company primarily develops residential properties with its available-for-sale projects mainly located in
Shenzhen and Shantou during the Reporting Period. Meanwhile two new projects have been launched one in
Huizhou which is close to Shenzhen and another in Guangming District Shenzhen. In Shenzhen the Chuanqi
Donghu Mingyuan project and the Cuilinyuan project both completed construction and have started the hand-over
and move-in process with some remnant units still available for sale. In Shantou the Tianyuewan project
completed construction in June 2021 with Phase I around 80% sold cumulatively and Phase II around 20%. In
mid May 2021 the Company completed the acquisition of a controlling stake in the Linxinyuan project (located in
Huizhou close to Shenzhen) which resumed construction in late June 2021 and has kicked off pre-sale for Phase
I in mid December 2021. Additionally the Company won the bid for the right to use the state-owned Land Lot No.A511-0039 in Guangming District Shenzhen in late September 2021 with construction kicking off in mid
January 2022.New additions to the land bank:
Consideratio
Floor area The Total land n of the
Name of land Planned use How the land
Location Site area（㎡） with plot Company’s price Company’s
lot or project of land is obtained
ratio （㎡） interest (RMB’0000) interest
(RMB’0000)
Changbu
Linxinyuan Village
(previously Xinxu Town Commercial
the Huiyang and 198676.60 397353.20 Acquisition 51.00% 60667 45000
“Linxijun” District residential
project) Huizhou
City
11ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Guangdong
Province
Southeast
corner of the
junction of
Mingzheng
Commercial
Road and
SPG and Bidding at an
Deya Road 10721.07 53605.00 100.00% 96500
Guangmingli residential auction
Guangming
type 2
Street
Guangming
District
Shenzhen
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
SPG Guangmingli 1.07 5.36 5.36
Total 11.77 31.76 31.76
Development status of major projects:
Time Planned Floor
Cumulat Expecte Cumulat
for floor area
The ively d total ive
commen % % area complet
City/reg Name of Locatio Compan Site area complet investm investm
Status cement develop construc with ed in the
ion project n y’s （㎡） ed floor ent ent
of ed ted plot Current
interest area (RMB’0 (RMB’0
construc ratio Period
（㎡）000)000)
tion （㎡） （㎡）
Tianyue Chaoya 1
Complet 100.00 100.00
Shantou wan ng October 100% 33362 127770 127770 127770 65485 64597
ed % %
Phase II District 2018
Framew
Linxiny
ork in 11 June
Huizhou u an Huiyang 51.00% 77% 77.00% 64278 159761 0 0 115750 89044
construc 2021
Phase I
tion
SPG Guangm Foundat 19
Shenzhe 100.00
Guangm ing ion pit January - 10721 53605 - - 151758 99395
n %
ingli District being 2022
12ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
built
Sales status of major projects:
Pre-sale/ Pre-sale/
Floor
Cumulati sales Floor sales
area
Floor vely revenue Cumulati area revenue
The Floor pre-sold/
area pre-sold/ generate vely settled in settled in
City/regi Name of Compan area with sold in
Location Status available sold in the settled the the
on project y’s plot ratio the
for sale floor Current floor Current Current
interest （㎡） Current
（㎡） area Period area (㎡) Period Period
Period
（㎡） (RMB’0 （㎡） (RMB’0
（㎡）
000)000)
Chuanqi
Shenzhe Donghu Luohu Ready
100.00%557273285732440716048361300121416970662
n Mingyua District for sale
n
Shenzhe Cuilinyu Longgan Ready
100.00%60111561375196935161519693381148
n an g District for sale
Tianyue
Chaoyan Ready
Shantou wan 100.00% 153470 160372 114462 14951 7967 92524 15531 8008
g District f or sale
Phase I
Tianyue
Chaoyan On
Shantou wan 100.00% 127770 137059 17004 15829 9174 11517 11517 6159
g District p re-sale
Phase II
Linxinyu
Huiyang On
Huizhou an Phase 51.00% 159761 159761 844 844 1018
District pre-sale
I
Rental status of major projects:
The Company’s Rentable area Cumulative Average
Name of project Location Use
interest （㎡） rented area （㎡） occupancy rate
Real Estate Shenzhen Commercial
100.00%3413.883413.88100.00%
Mansion
North Block of Shenzhen Commercial
Guoshang 100.00% 4819.71 4752.98 98.62%
Mansion
Petrel Building Shenzhen Commercial 100.00% 22475.47 22475.47 100.00%
SPG Plaza Shenzhen Office building 100.00% 61015.82 36667.96 60.09%
SPG Plaza Shenzhen Commercial
100.00%19886.316123.4981.08%
Podium
Wenjin Garden Shenzhen Commercial 100.00% 3531.60 3531.60 100.00%
Primary land development:
13ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
□ Applicable √ Not applicable
Financing channels:
Financing cost Maturity structure
Ending balance of
Financing channel range/average
financings Within 1 year 1-2 years 2-3 years Over 3 years
financing cost
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 amou
Project Guarantee period Note
nt (RMB’0000)
Cuilinyuan Until the property ownership certificate is 2802.31
registered as collateral and handed over to bank for
keeping
Chuanqi Donghu Until the property ownership certificate is 2924.43
Mingyuan registered as collateral and handed over to bank for
keeping
Tianyuewan Until the property ownership certificate is 33511.08
registered as collateral and handed over to bank for
keeping
Total 39237.82
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 the Compatibility of
Type of Investment As % of total Cumulative Disinvestme
Project peak of project actual investment
investor amount (RMB) investment returns nt
funds and returns
Director
Linxinyuan
supervisor or
(previously the
senior 8950000.00 39.25% 0.90% 0.00 N/A N/A
“Linxijun”
management of
project)
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
14ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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.In 2021 the Company were granted the titles of “Socially Responsible Company” and “Honest Company” in
the real estate world of Shenzhen.IV Core Business Analysis
1. Overview
In 2021 in the face of many challenges such as the ever-changing environment the pandemic the economic
downturn and the intensifying market competition the Company’s management team conscientiously
implemented the decisions and deployment of the controlling shareholder the CPC Committee of the Group and
the Board of Directors led the working staff to unite as one stay determined and focus on operation and
management and completed all tasks in an all-round way achieving a good start for the “14th Five-Year Plan”.The development of the Company became more stable more high-quality and more resilient. The main
achievements in the past year are as follows:
(I) Impressive results in major corporate events by seizing opportunities and preventing risks
1. New breakthroughs in project expansion
The Company actively promoted the expansion of main business projects. In mid-May it successfully completed
the acquisition of Linxinyuan Project in Huizhou. On 28 September it participated in the second-round auction of
Shenzhen’s “concentrated supply of land” for 2021 and successfully won the bid for No. A511-0039 land in
Guangming District Shenzhen at the reserved price. Throughout the year the new capacity development area
totaled 450000 square meters injecting new momentum for the Company’s sustainable development.
2. New progress in project construction
First the Company completed the completion acceptance for Longgang Project and Shantou Tianyuewan Phase II
Project in April and June respectively. Second in Huizhou the Company recovered the construction for
Linxinyuan Project at the end of June and the project was opened for sale in early December. Third the land of
SPG Guangmingli Project was acquired at the end of September and the construction started smoothly in
mid-January 2022.
3. New achievements in real estate sales
15ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
In 2021 307 units of the Company’s main business projects were sold in initial subscription with a sales area of
38729 square meters and a sales amount of RMB676 million including 69 units in Shenzhen (with a sales area of
7923 square meters and a sales amount of RMB504 million) and 238 units in Shantou (with a sales area of 30806
square meters and a sales amount of RMB172 million).
4. New actions in quality and efficiency improvement
First the Company successfully completed the tourism transformation of Petrel Hotel. Second the Company
completed the signing of the equity transfer agreement for Shenzhen Property Management. Third the Company
introduced high-end pharmaceutical medical and medical aesthetic companies such as Shenzhen Luohu HospitalGroup and actively made a plan for creating an SPG Plaza-centric “comprehensive health eco-economic industrycomplex”. Fourth the equity transfer of Yunnan Kunpeng Air Service Co. LTD. was listed on The Stock
Exchange of Hong Kong Limited. Fifth steady progress was made in clearing out zombie companies and
disposing of and reducing losses.
5. New explorations for future development
First the Company actively conducted research on its future development and formulated the Quality
Improvement Action Plan to provide action guidelines for the Company’s future development. Second the
Company made studies and demonstrations of new industry markets and actively sought target projects with
strategic synergies in the industry. Third the Company enhanced communication with capital platforms in the
SASAC system to solicit support in aspects such as strategic consulting and project expansion and explore
industry fund cooperation.
6. New guarantees for safety and stability
First the Company thoroughly implemented safe production accountability established sound policies of safety
management and intensified efforts on checking and rectifying potential safety hazards thereby maintaining
stable production safety throughout the year. Second the Company adhered to regular pandemic prevention and
control with targeted measures fulfilled all work requirements of the CPC Shenzhen Municipal Committee the
Shenzhen Municipal People’s Government the Municipal SASAC and the controlling shareholder and saw
responsibilities were fulfilled by all the stakeholders. As a result a steady situation of pandemic prevention and
control was guaranteed. Third the Company coordinately focused on stability maintenance of petitioning and
public opinion monitoring to create a harmonious and stable environment for business operation and development.(II) Gratifying achievements in business management by strengthening the foundation and making up for
deficiencies
1. Continuous improvement of corporate governance
The Company fully revised and improved policies including the Rules of Procedure of the CPC Committee and
the List of Major Business Operation and Management Matters for the CPC Committee to Study and Discuss. By
making the CPC Committee’s studies and discussions a prerequisite for the decision-making of major issues by
the Board of Directors and the management team the Company strictly controlled its major decision-making
processes. Additionally the Company revised/formulated 42 policies related to corporate governance and internal
management and compiled them into a book to build a more scientific and sounder policy system constantly
improving the level of corporate governance. It continued to promote the development of a comprehensive risk
management system and organized all units to carry out internal control self-assessment which consolidated the
foundation for the steady development of the Company.
2. Practical effectiveness of financial management
First the Company successfully completed the distribution of profits for 2020 and paid cash dividends to all
shareholders achieving normal cash dividends for three consecutive fiscal years. Second the Company attained
capital gains of more than RMB40 million through negotiated deposits monetary funds and other means
16ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
throughout the year. Third the Company thoroughly cleaned up its receivables and recovered nearly RMB20
million of overdue receivables. Fourth the Company was active in coordination and communication. It completed
the land appreciation tax refund process for Longgang Project and received a tax refund of more than RMB70
million. Fifth the Company overcame difficulties and completed the mortgage bank cooperation negotiations for
Linxinyuan Project in Huizhou obtaining a mortgage of RMB800 million to provide support for project sales.
3. Breakthroughs in addressing issues left over from history
The Company actively took measures to speed up the execution of cases such as those involving Fresh Peak
Property Sandao and Golden Times with more than RMB1.7 million recovered. It also kept promoting the
special work of historical housing payment collection. A total of more than RMB1.5 million in arrears was
recovered throughout the year.
4. Good results in cost control
The Company continued to strictly control project development costs. It implemented full cost whole process
and penetration management and paid close attention to the budget and final accounting of major projects.Throughout the year the Company prepared 32 budgets and the reduction rate of budget amount was 2.08%; 27
settlement audits were completed and the reduction rate of settlement amount was 5.34%.
5. Steady growth in lease business
The Company promoted lease property through multiple channels. Throughout the year a total of 109 lease
contracts were newly signed or renewed covering an area of 33000 square meters; the Company’s cumulative
lease revenue reached 107.6% of the annual target a year-on-year increase of 33%.
6. Orderly development of human resources work
The Company explored the establishment of a sound incentive/constraint mechanism and organized employee
co-investment in Linxinyuan Project in Huizhou so as to stimulate employees’ enthusiasm and creativity. It
actively carried out human resources management and enriched the cadre and staff teams. It also completed the
work for full coverage of special review of personnel files efficiently with quality and quantity assured in
accordance with the requirements of the Organization Department of the CPC Shenzhen Municipal Committee
and SIHC.
7. Solid progress in audit supervision
The Company actively carried out internal audit supervision. It completed the audit and assessment filing for the
capital verification based on physical inventory of Linxinyuan Project in Huizhou and Yunnan Kunpeng Air
Service Co. LTD. conducted special inspections of the capital safety management of subordinated enterprises
and organized and coordinated the investment control audit team to complete the special audit of Tianyuewan
Project in Shantou empowering the stable and healthy development of the Company.(III) New momentum to the development of subordinated enterprises by stabilizing operation and
overcoming difficulties
1. Business performance
Affected by factors such as the economic downturn industry regulation and the pandemic the Shantou branch of
the Company Petrel Hotel and Zhentong Engineering operated under pressure. Shenzhen Property Management
and Huazhan Construction Supervision overcame many difficulties and adverse factors paid close attention to
operation and achieved their annual business objectives.
2. Business management
Shenzhen Property Management successfully completed the re-certification for its management system and
carried out the special action of garbage sorting in communities. Its management level was improved to a certain
extent. Petrel Hotel standardized its operating process and organized special training such as sales and etiquette
promoting its services to a higher level. Zhentong Engineering successfully obtained the Grade B qualification for
17ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
curtain wall design which created good hardware conditions for business expansion. Huazhan Construction
Supervision strengthened on-site supervision to effectively guarantee project safety and project quality. The
Shantou branch of the Company intensified efforts on project cost control thereby effectively reducing project
costs. Jianbang Group coordinately advanced different tasks including development construction marketing and
promotion with practical results achieved.
3. Market expansion
Zhentong Engineering made great efforts to develop external markets and signed 57 projects. Petrel Hotel
introduced the internet-famous shop project and successfully leased out some properties that had been vacant for a
long time. Huazhan Construction Supervision successfully won the bid for the supervision project of the Tigo
Semiconductor Memory Industry Base.(IV) A clean and righteous atmosphere that enables entrepreneurs to focus on business development by
working on Party building and fostering harmony
1. Solid progress in Party building
The CPC Committee of the Company created new methods to promote the provision and effectiveness of Party
history education. Party organizations at all levels in the system integrated the education of the Party history intoeveryday life. Adhering to the problem-orientated concept the Company continuously led the practice of “I dopractical things for the masses” in depth and donated property management equipment to support happy
community building. With a strict and pragmatic approach it consolidated the development of community-level
Party organizations normalized and institutionalized the study by the Theoretical Center Team of the CPC
Committee and earnestly carried out all tasks of the “Five Ones” project in the education of Party members.
2. Furthering deepening of clean and honest Party conduct development
The Company fully implemented the joint deployment implementation inspection and assessment of clean and
honest Party conduct development and business operation. It gave full play to the synergy of the big supervision
system facilitated the integration of different supervision measures focused on the main business and primary
responsibilities and effectively ensured that all tasks in the annual list of tasks for development of clean and
honest Party conduct and anti-corruption work as well as key points of annual supervision were implemented.On the occasion of the 100th anniversary of the founding of the Party the Company enhanced honesty publicity
and education solidly organized the discipline education and learning month strengthened work style
development promoted the positive energy of honesty and created a clean and righteous atmosphere that enables
entrepreneurs to focus on business development.
3. Great vitality of corporate culture development
Throughout the year the Company organized more than 150 football tennis badminton table tennis yoga and
other interest group and sports activities enriching employees’ lifestyle after work. The Company successfully
held the “SPG Cup” Table Tennis Invitational Competition and carried out the “Zouhongqiao” “EmployeeCollective Birthday Party” visits to Linxinyuan Project in Huizhou and other activities creating a sound
environment where the Company builds platforms and the employees participate enhancing corporate
cohesiveness.
2. Revenue and Cost Analysis
(1) Breakdown of Operating Revenue
Unit: RMB
2021 2020 Change (%)
18ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
As % of total As % of total
Operating revenue operating revenue Operating revenue operating revenue
(%)(%)
Total 1320790648.45 100% 1615009713.88 100% -18.22%
By operating division
Property sales 876161088.60 66.34% 1158411393.81 71.73% -24.37%
Engineering and
200259571.1615.16%251454463.4315.57%-20.36%
construction
Property
162526580.1812.31%151968675.519.41%6.95%
management
Rental service 81791161.56 6.19% 63254584.48 3.92% 29.30%
Other 15776937.12 1.19% 12215550.30 0.76% 29.15%
Eliminated internal
transactions and -15724690.17 -1.19% -22294953.65 -1.38% -29.47%
accounts
By product category
Residential units 875153000.99 66.26% 1157620917.61 71.68% -24.40%
Shops and parking
1008087.610.08%790476.200.05%27.53%
lots
Other 460354250.02 34.85% 478893273.72 29.65% -3.87%
Eliminated internal
transactions and -15724690.17 -1.19% -22294953.65 -1.38% -29.47%
accounts
By operating segment
Guangdong Province 1308786001.07 99.09% 1613933749.67 99.93% -18.91%
Other regions in
27096812.692.05%22531905.611.40%20.26%
China
Overseas 632524.86 0.05% 839012.25 0.05% -24.61%
Eliminated internal
transactions and -15724690.17 -1.19% -22294953.65 -1.38% -29.47%
accounts
By marketing model
Principal operations 1320738401.50 100.00% 1625089117.23 100.62% -18.73%
Other 15776937.12 1.19% 12215550.30 0.76% 29.15%
Eliminated internal
transactions and -15724690.17 -1.19% -22294953.65 -1.38% -29.47%
accounts
19ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
(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
Operating Gross profit YoY change in
Cost of sales operating revenue gross profit
revenue margin cost of sales (%)
(%) margin (%)
By operating division
Property sales 876161088.60 292260823.05 66.64% -24.37% -24.61% 0.11%
Engineering and
200259571.16186409100.146.92%-20.36%-23.76%4.16%
construction
Property
162526580.18145898235.4910.23%6.95%4.26%2.31%
management
By product category
Residential units 875153000.99 292183630.99 66.61% -24.40% -24.57% 0.08%
Shops and
1008087.6177192.0692.34%27.53%-73.44%29.11%
parking lots
By operating segment
Guangdong
1308786001.07799028972.3038.95%-18.91%0.00%-24.50%
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 2021 2020 Change (%)
Sales volume RMB’0000 69045 38767 78.10%
Property sales Output RMB’0000 204708 15616 1210.89%
Inventory RMB’0000 403220 121599 231.60%
Any over 30% YoY movements in the data above and why:
√ Applicable □ Not applicable
Compared with 2020 the year 2021 saw growth and breakthroughs in property development sales and investment.
20ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
(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
20212020
Operating
Item As % of total cost As % of total cost Change (%)
division Cost of sales Cost of sales
of sales (%) of sales (%)
Property sales 292260823.05 43.86% 387659747.71 48.13% -24.61%
Engineering and
186409100.1427.97%244511214.5830.35%-23.76%
construction
Property
145898235.4921.90%139937487.1217.37%4.26%
management
Rental service 35545938.32 5.33% 35984852.34 4.47% -1.22%
Other 22151678.03 3.32% 11611768.12 1.44% 90.77%
Eliminated
internal
-15917413.55-2.39%-14196621.19-1.76%12.12%
transactions and
accounts
Total 666348361.48 100.00% 805508448.68 100.00% -17.28%
Note:
Affected by markets and development cycles property sales and construction both experienced a year-on-year drop.
(6) Changes in the Scope of Consolidated Financial Statements for the Reporting Period
√ Yes □ No
See “VI Changes to the scope of consolidation” 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) 58130053.77
Total sales to top five customers as % of total sales of the
4.45%
Reporting Period (%)
21ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Total sales to related parties among top five customers
0.00%
as % of total sales of the Reporting Period (%)
Information about top five customers:
Sales revenue contributed for
No. Customer As % of total sales revenue (%)
the Reporting Period (RMB)
1 Legal person A 15319118.77 1.17%
2 Legal person B 11483285.27 0.88%
3 Legal person C 11167029.09 0.86%
4 Legal person D 10532814.03 0.81%
5 Legal person E 9627806.61 0.74%
Total -- 58130053.77 4.45%
Other information about major customers:
□ Applicable √ Not applicable
Major suppliers:
Total purchases from top five suppliers (RMB) 89911678.31
Total purchases from top five suppliers as % of total
34.81%
purchases of the Reporting Period (%)
Total purchases from related parties among top five
suppliers as % of total purchases of the Reporting Period 12.00%
(%)
Information about top five suppliers:
Purchase in the Reporting
No. Supplier As % of total purchases (%)
Period (RMB)
1 Legal person A 30985550.60 12.00%
2 Legal person B 32704335.85 12.66%
3 Legal person C 10113649.04 3.92%
4 Legal person D 8196092.74 3.17%
5 Legal person E 7912050.08 3.06%
Total -- 89911678.31 34.81%
Other information about major suppliers:
□ Applicable √ Not applicable
3. Expense
Unit: RMB
2021 2020 Change (%) Reason for any significant change
Selling expense 42737748.22 55989397.22 -23.67%
22ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Administrative expense 98307831.60 93616226.75 5.01%
Finance costs -18083491.01 -21505685.05 15.91%
4. R&D Investments
□ Applicable √ Not applicable
5. Cash Flows
Unit: RMB
Item 2021 2020 Change (%)
Subtotal of cash generated from
1805846506.241783707997.051.24%
operating activities
Subtotal of cash used in
3011798614.181498543983.88100.98%
operating activities
Net cash generated from/used in
-1205952107.94285164013.17522.90%
operating activities
Subtotal of cash generated from
799855541.481019824221.85-21.57%
investing activities
Subtotal of cash used in
1751621932.29749215.31233694.20%
investing activities
Net cash generated from/used in
-951766390.811019075006.54-193.40%
investing activities
Subtotal of cash generated from
266256968.7676893995.94246.26%
financing activities
Subtotal of cash used in
164908415.94218571160.17-24.55%
financing activities
Net cash generated from/used in
101348552.82-141677164.23155.44%
financing activities
Net increase in cash and cash
-2056810291.671161914166.47-277.02%
equivalents
Explanation of why any of the data above varies significantly:
√ Applicable □ Not applicable
Cash used in operating activities increased substantially year-on-year primarily because property investment and development
increased.Net cash generated from investing activities decreased primarily due to the purchase of financial products for investment purposes.Net increase in cash and cash equivalents decreased substantially year-on-year primarily due to investment in property project.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
23ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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 2021 1 January 2021 Change in
As a % of As a % of percentag Reason for any significant change
Amount Amount
total assets total assets e (%)
564358824.639.13%2687465070.54.44%-45.31%
Monetary assets Purchase of project stake and land
01
Accounts 61048785.11 0.99% 59590944.06 1.21% -0.22%
receivable
4034933562.62 65.26% 1220464112. 24.72% 40.54% New project and new addition to land
Inventories
56 bank
Investment 588865777.16 9.53% 616365621.53 12.48% -2.95%
property
Long-term equity 272168.28 0.00% 377489.65 0.01% -0.01%
investments
Fixed assets 23920424.55 0.39% 28039978.43 0.57% -0.18%
Right-of-use 365351.97 0.01% 0.00% 0.01%
assets
Short-term 50440116.24 0.82% 76893995.94 1.56% -0.74%
borrowings
Contract 199965490.08 3.23% 196786977.19 3.99% -0.76%
liabilities
Lease liabilities 125920.77 0.00% 0.00% 0.00%
Taxes payable 600497936.70 9.71% 459709646.95 9.31% 0.40% Land value-added tax provision
581377415.64 9.40% 277105129.74 5.61% 3.79% Borrowing to project company from
Other payables
minority shareholder
Indicate whether overseas assets account for a high proportion of total assets.□ Applicable √ Not applicable
24ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
2. Assets and Liabilities at Fair Value
√ Applicable □ Not applicable
Unit: RMB
Gain/loss on Cumulative
Impairment
fair-value fair-value Purchased in Sold in the
Beginning allowance for Other Ending
Item changes in the changes the Reporting Reporting
amount the Reporting changes amount
Reporting charged to Period Period
Period
Period equity
Financial
assets
4.
Investments
36322704.
in other 37510860.51 -1188156.18 4509209.49
33
equity
instruments
Subtotal of
36322704.
financial 37510860.51 -1188156.18 4509209.49
33
assets
Total of the 36322704.
37510860.51-1188156.184509209.49
above 33
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
Accounts receivable 50440116.24 Put in pledge for short-term borrowings
Monetary assets 3500000.00 Frozen in a lawsuit case
Monetary assets 5674439.78 Project of public facilities inside and
surrounding the urban renewal project of
Longgang District
Shenzhen-construction funds
Total 59614556.02 --
25ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
VII Investments Made
1. Total Investment Amount
√ Applicable □ Not applicable
Total investment amount in the Reporting Total investment amount in last year
Change (%)
Period (RMB) (RMB)
2047080000.00205660000.00895.37%
2. Significant Equity Investments Made in the Reporting Period
√ Applicable □ Not applicable
Unit: RMB
Whet
her
Name Invest
Inve Inve invol
of Sharehol Fundin ment Date of Disclos
Main stme stme Status as on the ved
investe Invested ding g Partne Produc Predicte return disclos ure
busin nt nt date of the balance in
e amount percenta Resour rs t type d return in the ure (if index
esses meth Dura sheet any
enterpri ge ces current any) (if any)
ods tion legal
se period
action
s
Ownership Announ
transfer cement
formalities were on
completed in mid Progres
May 2021. s on
Jianbang Group Acquisi
Guang has been included tion of
Guangd
zhou in the Company’s 51% of
ong
Bopi consolidated Equity
Jianban
Real Enterp Reside financial in
g
estate acqu rise ntial statements. The -6422 Guangd
Group 450000 Self-o 637500 15 May
devel isitio 51.00% Manag - units Linxinyuan 929.28 Yes ong
(Huiya 000.00 wned 000.00 2021
opme n ement and project developed Jianban
ng)
nt Consul shops by Jianbang g
Industri
ting Group has Group
al Co.Co. resumed (Huiya
Ltd.Ltd. construction in ng)
late June 2021 Industri
with Phase I al Co.kicking off Ltd.pre-sale in mid (No.:
December 2021. 2021-0
Currently the 20)
26ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Company is disclose
operating as d on
planned. www.c
ninfo.c
om.cn
Announ
cement
on
Progres
s on
Incorpo
Shenzh
Incorporation ration
en SPG
formalities were of
Chuanq Real Reside
completed on 29 1 Wholly
i Real estate Inco ntial
995000 Self-o October 2021. 335670 -6264 Novem -owned
Estate devel rpor 100.00% - - units No
000.00 wned This project has 000.00 68.85 ber Subsidi
Develo opme ated and
started 2021 ary
pment nt shops
construction in (No.Co.mid January 2022. 2021-0
Ltd.
48)
disclose
d on
www.c
ninfo.c
om.cn
144500973170-70493
Total -- -- -- -- -- -- -- -- -- -- --
0000.00000.0098.13
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.
27ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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
Amo
unt
cont
Amou
ribut
nt
ed
contrib
by
uted
the
by the
sale
equity
to
interes
net
ts to Rel
inco Own Executed
net ate
me ershi as
Selling incom d-p Relationship Index to
of p scheduled
Equity price e of arty between disclose
Count Date Effect of the sale the Pricing fully or not if Disclos
interes (RMB the tran counterparty d
erparty of sale on the Company Com principle trans not state ure date
ts sold ’0000 Comp sact and the informat
pany ferre reason and
) any ion Company ion
as a d or actions
from or
perc not taken
period not
enta
-begin
ge of
ning to
the
date of
Com
sale
pany
(RMB
’s
’0000
net
)
inco
me
(%)
28ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Shenzhen
Announ
This transaction is International
cement
in line with the Trade Center
on the
Company’s Property
Progress
development Management
of the
strategies and is Co. Ltd.Related-
conducive to the (hereinafter
party
Company’s further referred to as
Transactoptimization and The “ITC Propertyionadjustment of its transactio Management”
regardin
100% industry structure n price is ) is a
Shenz g the
of enrichment of determine wholly-owned
hen Transfer
equity capital reserves d based subsidiary of
Interna of 100%
interes expansion of new on the net ShenZhen
tional of
ts of profit growth asset Properties &
Trade 11 Equity
Shenz areas and valuation Resources 15
Center Februa 19667 0.00 Interests
hen 334.69 continuous assessed Yes D evelopment Yes Yes Februar
Proper ry .67 % of
Proper improvement of its by the (Group) Ltd. y 2022
ty 2022 Shenzhety quality. Proceeds evaluatio “hereinafterManag n
Manag from this equity n agency referred to as
ement Property
ement transfer will be on the “SZPRD” and
Co. Manage
Co. carried forward in base date both SZPRD
Ltd. ment
Ltd. 2022 and will have of 30 and the
Co.a positive impact June Company are
Ltd.on the cash flows 2021. majority-owne
(No.:
of the Company. d subsidiaries
The specific of Shenzhen
1)
impact is subject Investment
disclose
to the annual Holdings Co.d on
auditing result Ltd. Thus an
www.cn
issued by the audit association
info.co
firm. relationship is
m.cn
formed.IX Major Subsidiaries
√ Applicable □ Not applicable
Major fully/majority-owned subsidiaries and those minority-owned subsidiaries with an over 10% effect on the Company’s net profit:
Unit: RMB
Relationship Principal Registered Operating Operating
Name with the activity Total assets Net assets Net profit capital revenue profit
Company
Guangdong Subsidiary Development 2800000.00 119431256 -7511961.3 -8490635.4 -6422929.2
29ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Jianbang of real estate 2.50 5 4 8
Group
(Huiyang)
Industrial
Co. Ltd.Shenzhen
SPG Chuanqi
Development 30000000.0 994623335. 994373531.Real Estate Subsidiary -826235.27 -626468.85
of real estate 0 62 15
Development
Co. Ltd.Shenzhen
SPG
Development 30000000.0 265395040. 124744977. 28911854.2 10236841.3
Longgang Subsidiary 9645676.62
of real estate 0 07 43 8 1
Development
Co. Ltd.Shantou
SEZ Wellam
FTY Development 91226120.4 170626252. 122561035.Subsidiary 1008087.61 251183.65 170289.40
Building of real estate 4 25 98
Development
Co. Ltd.Shantou
Huafeng Real
Development 80000000.0 978047725. 21038772.4 141667875.Estate Subsidiary 542656.62 397168.52
of real estate 0 92 5 10
Development
Co. Ltd.Great Wall
Development 18201422.1 -80904534.Estate Co. Subsidiary 2051146.00 632524.86 -284455.30 -284455.30
of real estate 3 73
Inc. (U.S.)
Shenzhen
Installation
Zhentong 10000000.0 122011401. 19822359.6 201876257. -6226318.9 -4786992.9
Subsidiary and
Engineering 0 31 7 29 0 8
maintenance
Co. Ltd.Shenzhen
Property Property 100916928. 35164476.4 163141074.Subsidiary 7250000.00 4514075.45 3346927.48
Management management 47 1 63
Co. Ltd.Shenzhen
30000000.049219742.739446188.217378195.0-3539934.3-2703299.9
Petrel Hotel Subsidiary Hotel Service
022751
Co. Ltd.Shenzhen
Subsidiary Construction 8000000.00 10639068.8 10035220.9 3214530.36 111097.51 99035.57
Huazhan
30ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Construction supervision 6 1
Supervision
Co. Ltd.Xin Feng Investment
413340621.-132382885
Enterprise Subsidiary and 502335.00 1285471.06 1285471.06
60.12
Co. Ltd. management
Subsidiaries obtained or disposed in the Reporting Period:
√ Applicable □ Not applicable
Influence on overall production and
Name Way of gaining and disposing subsidiaries
operation as well as performance
The real estate project company is
Guangdong Jianbang Group (Huiyang) currently under the development and
Share acquisition
Industrial Co. Ltd. construction and will be carried forward in
2023.
It is currently in the initial stage of
Shenzhen SPG Chuanqi Real Estate
Newly established development and construction and will be
Development Co. Ltd.carried forward in 2024.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.
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.
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 RMB29 million in 2021 (the percentage of
accumulative sales carried forward was 95%) accounting for 2.19% of the Company's operating revenue. 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 opened for sale in October 2016 and 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 72% for Phase I and 13% for Phase II.
4. Shenzhen Zhentong Engineering Co. Ltd. was engaged in the business of building installation and maintenance with the 2021
operating revenues of RMB202 million and of 15.28% to the operating revenues of the Company.
5. Shenzhen Property Management Co. Ltd was engaged in the industry of property management. The 2021 operating revenues was
of RMB163 million that was of 12.35% to the operating revenues of the Company.
6. The 2021 net profit of Xin Feng Enterprise Co. Ltd. was of RMB1.29 million which mainly due to the changes of exchange rate
and it conducts no business.
7. The 2021 net profit of Shenzhen Petrel Hotel Co. Ltd. was of RMB-2.7 million which mainly due to the epidemic.
31ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
X Structured Bodies Controlled by the Company
□ Applicable √ Not applicable
XI Prospects
(I) Industrial Pattern and Trend
The state continues to uphold the principle that “houses are for living in not for speculating on” encourages both
housing purchase and renting and implements city-specific policies to promote a virtuous circle and the healthy
development of the real estate industry. Under the continuous control of multiple financial regulatory policies the
real estate enterprises have gradually shifted their development goals from “quantity first” to “quality first”. The top
enterprises with high qualities as a result will be easy to get more resources and a new industry competition
landscape will be presented.(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. At present along with the accelerated rate of global vaccination and the lifting of
lockdown measures in various countries the global economic recovery has been significantly enhanced but the
world economic situation remains complicated and severe due to the repeated ups and downs of the pandemic and
frequent variants of the virus. 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
Under the guidance of "housing is for living in not for speculation" the regulation and control policies are
progressive. The market is entering a period of adjustment and the industry is entering a stage of profound
changes. The development of the Company is undergoing new tests. The Company will continue to deepen its
research on industry policies follow the national strategies innovate its operating model and optimize its
development method. At the same time the Company will conduct research on strategic emerging industries in a
timely manner to explore new areas and cultivate new business models.
3. Business operating risks and countermeasures
Due to the implementation of a series of policies such as the real estate loan concentration management
mechanism and "centralized land supply" it poses new challenges for the Company to expand its development
land reserve. 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 2022 will see the convening of the 20th National Congress of the Communist Party of China. It is also a
crucial year for the Company to deepen its reform. The Company will resolutely implement the decisions and
deployment of the CPC Shenzhen Municipal Committee the Shenzhen Municipal People’s Government the
Municipal SASAC and SIHC. The “Dual Zone” construction in Shenzhen and the policy of deepening the reform
of state-owned assets and enterprises have brought strategic opportunities for the Company to plan for projects
reserves and stabilize operation and management. Correspondingly the Company will strive to seek new
breakthroughs in its reform and development.The Company has made an overall operating plan for 2022. Guided by the Xi Jinping Thought on Socialism with
Chinese Characteristics for a New Era the Company will conscientiously implement the spirit of the 19th
32ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
National Congress of the Communist Party of China all previous plenary sessions of the 19th Central Committee
of the Communist Party of China and the Central Economic Work Conference and take overall planning of
production and operation by Party building and high-quality development. It will stabilize the operation on the
basis of safety management explore future development directions and focus on project development and sales
while strengthening the implementation. At the same time the Company will make efforts in key tasks such as
project financing quality and efficiency improvement and risk control. Additionally the Company will work hard
to improve its internal strength and operate meticulously making every effort to promote its high-quality
development to a new level.
1. Focus on the main business and continue to build a solid foundation for development
First the Company will accelerate project construction to ensure the smooth implementation of project
development plans. Second the Company will fully boost project sales to provide sufficient cash flow and
performance support for its future development. Third the Company will intensify efforts to research real estate
policies work on land development surveys moderately expand the resource reserves of main business projects
and continually strengthen the foundation for high-quality development.
2. Enhance synergy and actively explore future development directions
First with the help of intermediary service agencies the Company will keep strengthening market research on
strategic emerging industries. Second the Company will continue to enhance communication with the Municipal
SASAC and the controlling shareholder and strive to achieve strategic synergy with the systems. Third the
Company will cooperate with system capital platforms to leverage social capital in the form of industry
investment funds and jointly explore business opportunities. Fourth through fund operation the Company will
select target projects that generate stable revenue and profits show great growth potential and can be integrated in
order to steadily increase profits.
3. Improve quality and efficiency and continuously optimize the industry structure
First the Company will speed up the collection of equity transfer funds and the transfer of assets and personnel
with respect to Shenzhen Property Management. Second the Company will sell self-owned properties that do not
have urban renewal qualifications or appreciation potential. Third the Company will accelerate the equity transfer
of Yunnan Kunpeng Air Service Co. LTD. and recover the investment funds as soon as possible. Fourth the
Company will continue to clear out zombie companies. Fifth the Company will keep promoting in-depth
cooperation with the Luohu District People’s Government and Shenzhen Luohu Hospital Group on the theme of
comprehensive health.
4. Make sound overall planning to conduct major works in an orderly fashion
First the Company will enhance communication with financial institutions strive to expand financing channels
flexibly operate different financing instruments and rationally optimize its asset-debt structure. Second the
Company will strengthen organizational guarantees fulfill its responsibilities and make every effort to solve
problems left over from history. Third benchmarked against model enterprises the Company will turn to lean
management improve rules and regulations continuously and standardize decision-making procedures in order to
improve the quality of decision-making and fully enhance its comprehensive strength. Fourth the Company will
maintain team stability optimize the age structure and knowledge structure of the talent team and ensure that the
team’s combat effectiveness does not decline and execution power does not lag behind. Fifth the Company will
take multiple measures to consolidate responsibilities and intensify efforts to collect arrears. Sixth the Company
will deeply advance the development of its policies on supervision inspection and accountability
comprehensively strengthen the application of supervision results take accountability and performance
management seriously and focus on improving execution power to ensure the implementation of all tasks.
33ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
5. Make unremitting efforts on the implementation of different measures for safe production
The Company will unify its thinking clarify its directions carry out safe production and petitioning stability
maintenance creatively with high standards closely based on its own reality and strive to break new grounds in
safety and stability. First the Company will continue to establish sound policies of safe production management
strictly implement the accountability system for safe production intensify efforts on checking potential safety
hazards and enhance safety governance in major areas. Second the Company will adhere to regular pandemic
prevention and control with targeted measures by taking various steps and stringent precautions for strictly
preventing and controlling the pandemic to guarantee a steady situation of pandemic prevention and control.
6. Strengthen leadership and work on Party building
Guided by the Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era the Company will
organize the study publicity and implementation of the spirit of the 20th National Congress of the Communist
Party of China consolidate and deepen the achievements of Party history education and incorporate Party history
education into all Party building tasks. On top of that the Company will strengthen its Party organization
theoretically and organizationally and improve the Party organization’s conduct. Playing a leadership role the
Party organization will set the right direction keep in mind the big picture ensure the implementation of Party
policies and principles and mobilize and give full play to the exemplary and vanguard role of Party members. The
Company will take a two-pronged approach on both Party building and business operation effectively integrating
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
Contents and
Index to main inquiry
Date of visit Place of visit Way of visit Type of visitor Visitor materials
information
provided
Inquired of the
future
development
The Individual
2021-01-07 By telephone Individual plan of the N/A
Company investor
Company and
didn’t offer
written materials
Inquired of
project sales of
The Individual
2021-01-13 By telephone Individual the Company N/A
Company investor
and didn’t offer
written materials
Inquired of the
land reserves
The Individual
2021-01-22 By telephone Individual and projects N/A
Company investor
progress of the
Company and
34ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
didn’t offer
written materials
Inquired of
business
situations and
The Individual strategic
2021-01-25 By telephone Individual N/A
Company investor planning of the
Company and
didn’t offer
written materials
Inquired of the
future
development
The Individual
2021-02-03 By telephone Individual plan of the N/A
Company investor
Company and
didn’t offer
written materials
Inquired of
business
situations and
The Individual strategic
2021-02-26 By telephone Individual N/A
Company investor planning of the
Company and
didn’t offer
written materials
Inquired of
business
The Individual
2021-03-01 By telephone Individual situation and N/A
Company investor
didn’t offer
written materials
Inquired of the
land reserves
and projects
The Individual
2021-03-02 By telephone Individual progress of the N/A
Company investor
Company and
didn’t offer
written materials
Inquired of the
future
The Individual
2021-03-18 By telephone Individual development N/A
Company investor
plan of the
Company and
35ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
didn’t offer
written materials
Inquired of
business
The Individual
2021-03-25 By telephone Individual situation and N/A
Company investor
didn’t offer
written materials
Inquired of
business
situations and
The Individual strategic
2021-03-30 By telephone Individual N/A
Company investor planning of the
Company and
didn’t offer
written materials
Inquired of
project sales of
The Individual
2021-04-07 By telephone Individual the Company N/A
Company investor
and didn’t offer
written materials
Inquired of the
future
development
The Individual
2021-04-16 By telephone Individual plan of the N/A
Company investor
Company and
didn’t offer
written materials
Inquired of the
land reserves
and projects
The Individual
2021-04-28 By telephone Individual progress of the N/A
Company investor
Company and
didn’t offer
written materials
Inquired of
business
situations and
The Individual strategic
2021-05-14 By telephone Individual N/A
Company investor planning of the
Company and
didn’t offer
written materials
36ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Inquired of
project sales of
The Individual
2021-05-18 By telephone Individual the Company N/A
Company investor
and didn’t offer
written materials
Inquired of the
future
development
The Individual
2021-05-20 By telephone Individual plan of the N/A
Company investor
Company and
didn’t offer
written materials
Inquired of the
land reserves
and projects
The Individual
2021-06-02 By telephone Individual progress of the N/A
Company investor
Company and
didn’t offer
written materials
Inquired of
business
situations and
The Individual strategic
2021-06-11 By telephone Individual N/A
Company investor planning of the
Company and
didn’t offer
written materials
Inquired of
business
situations and
The Individual strategic
2021-06-22 By telephone Individual N/A
Company investor planning of the
Company and
didn’t offer
written materials
Inquired of
project sales of
The Individual
2021-06-24 By telephone Individual the Company N/A
Company investor
and didn’t offer
written materials
The Individual Inquired of
2021-06-29 By telephone Individual N/A
Company investor business
37ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
situations and
strategic
planning of the
Company and
didn’t offer
written materials
Inquired of
project sales of
The Individual
2021-07-07 By telephone Individual the Company N/A
Company investor
and didn’t offer
written materials
Inquired of
business
situations and
The Individual strategic
2021-07-20 By telephone Individual N/A
Company investor planning of the
Company and
didn’t offer
written materials
Inquired of the
future
development
The Individual
2021-08-11 By telephone Individual plan of the N/A
Company investor
Company and
didn’t offer
written materials
Inquired of
project sales and
future
The Individual development
2021-08-19 By telephone Individual N/A
Company investor plan of the
Company and
didn’t offer
written materials
Inquired of
project sales of
The Individual
2021-08-24 By telephone Individual the Company N/A
Company investor
and didn’t offer
written materials
Inquired of the
The Individual
2021-09-01 By telephone Individual future N/A
Company investor
development
38ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
plan of the
Company and
didn’t offer
written materials
Inquired of the
future
development
The Individual
2021-09-02 By telephone Individual plan of the N/A
Company investor
Company and
didn’t offer
written materials
Inquired of the
land reserves
and projects
The Individual
2021-09-15 By telephone Individual progress of the N/A
Company investor
Company and
didn’t offer
written materials
Inquired of
business
situations and
The Individual strategic
2021-09-23 By telephone Individual N/A
Company investor planning of the
Company and
didn’t offer
written materials
Inquired of the
future
development
The Individual
2021-10-11 By telephone Individual plan of the N/A
Company investor
Company and
didn’t offer
written materials
Inquired of
project sales of
The Individual
2021-10-15 By telephone Individual the Company N/A
Company investor
and didn’t offer
written materials
Inquired of the
The Individual future
2021-10-26 By telephone Individual N/A
Company investor development
plan of the
39ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Company and
didn’t offer
written materials
Inquired of the
land reserves
and projects
The Individual
2021-11-03 By telephone Individual progress of the N/A
Company investor
Company and
didn’t offer
written materials
Inquired of
project sales of
The Individual
2021-11-11 By telephone Individual the Company N/A
Company investor
and didn’t offer
written materials
Inquired of the
future
development
The Individual
2021-11-18 By telephone Individual plan of the N/A
Company investor
Company and
didn’t offer
written materials
Inquired of the
land reserves
and projects
The Individual
2021-12-07 By telephone Individual progress of the N/A
Company investor
Company and
didn’t offer
written materials
Inquired of
project sales of
The Individual
2021-12-21 By telephone Individual the Company N/A
Company investor
and didn’t offer
written materials
Inquired of the
future
development
The Individual
2021-12-29 Field research Individual plan of the N/A
Company investor
Company and
didn’t offer
written materials
40ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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
41ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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.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
Relationshi
Company Company Progress and
Type p with the Course Countermeasures
name nature follow-up plan
Company
The Company and For the Company’s Refer to the
ShenZhen Properties & existing business that has Announcement
Shenzhen Resources Development horizontal competition on Receiving the
Horizontal Controlling Investment (Group) Ltd. (hereinafter with ShenZhen Properties Avoiding
Other
competition shareholder Holdings referred to as “SZPRD”) are & Resources Horizontal
Co. Ltd. majority-owned subsidiaries Development (Group) Competition
of Shenzhen Investment Ltd. Shenzhen Commitment
Holdings Co. Ltd. The Investment Holdings Co. Letter from the
42ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Company and SZPRD are Ltd. will within the scope Controlling
operating real estate permitted by laws and Shareholder (No.:
development and regulations timely launch 2021-032)
commercial property sales one or several of the disclosed by the
business which belong to following solutions that is Company on 11
the same industry. There is practically feasible and September 2021
horizontal competition. complete the and the
implementation of the Announcement
relevant solution(s) before on Resolutions of
9 November 2024 to solve the 1st
the existing horizontal Extraordinary
competition problem: (1) General Meeting
Solve the horizontal of 2021 (No.:
competition between the 2021-34)
two through asset sales or disclosed by
asset replacement; (2) ShenZhen
Solve the horizontal Properties &
competition between the Resources
two through equity Development
transfer; (3) Take other (Group) Ltd. on
measures that can 27 September
effectively solve the 2021 for details.problem of horizontal
competition.IV Annual and Extraordinary General Meeting Convened during the Reporting Period
1. General Meetings Convened during the Reporting Period
Investor Index to disclosed
Meeting Type Convened date Disclosure date
participation ratio information
Resolutions of 2020
Annual General
Meeting disclosed
The 2020 Annual Annual General on China Securities
63.55% 28 April 2021 29 April 2021
General Meeting Meeting Securities Times Ta
Kung Pao and
www.cninfo.com.cn
(No.: 2021-011)
Resolutions of the 1st
The 1st Extraordinary
Extraordinary Extraordinary
General Meeting of 63.55% 16 July 2021 17 July 2021
General Meeting General Meeting of
2021
2021 disclosed on
43ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
China Securities
Securities Times Ta
Kung Pao and
www.cninfo.com.cn
(No.: 2021-026)
Resolutions of the
2nd Extraordinary
General Meeting of
The 2nd
2021 disclosed on
Extraordinary Extraordinary
63.59% 11 October 2021 12 October 2021 China Securities
General Meeting of General Meeting
Securities Times Ta
2021
Kung Pao and
www.cninfo.com.cn
(No.: 2021-040)
Resolutions of the
3rd Extraordinary
General Meeting of
The 3rd
2021 disclosed on
Extraordinary Extraordinary
1.98% 29 December 2021 30 December 2021 China Securities
General Meeting of General Meeting
Securities Times Ta
2021
Kung Pao and
www.cninfo.com.cn
(No.: 2021-053)
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
Numbe
Increas Decreas
Beginni r of Other
e in the e in the Ending
Incumb ng granted increas Reason
Office Start of End of Stock Reporti Reporti shareho
Name ent/For Gender Age shareho restricte e/decre for
title tenure tenure options ng ng lding
mer lding d ase change
Period Period (share)
(share) shares (share)
(share) (share)
(share)
Liu Chairm 15
Incumb
Zhengy an of Male 52 January 0 0 0 0 0 0 0
ent
u the 2020
44ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Board
31
Tang
Directo Incumb Decem
Xiaopin Male 52 0 0 0 0 0 0 0
r ent ber
g
2020
14
Tang
Incumb Decem
Xiaopin GM Male 52 0 0 0 0 0 0 0
ent ber
g
2020
Deng 17
Directo Incumb
Kangch Male 56 April 10000 0 0 0 0 0 10000
r ent
eng 2012
11
Wang Directo Incumb
Male 49 October 0 0 0 0 0 0 0
Jianfei r ent
2021
22
Wang Incumb Septem
CFO Male 49 0 0 0 0 0 0 0
Jianfei ent ber
2021
8
Directo Incumb Septem
Wen Li Female 53 0 0 0 0 0 0 0
r ent ber
2006
31
Sun
Directo Incumb Decem
Minghu Male 41 0 0 0 0 0 0 0
r ent ber
i
2020
Kang Indepen
Incumb 15 May
Xiaoyu dent Male 58 0 0 0 0 0 0 0
ent 2018
e director
He Indepen
Incumb 30 June
Zuowe dent Male 60 0 0 0 0 0 0 0
ent 2020
n director
Mi Indepen
Incumb 30 June
Xumin dent Male 47 0 0 0 0 0 0 0
ent 2020
g director
Chairm
31
an of
Incumb Decem
Li Lian the Female 55 0 0 0 0 0 0 0
ent ber
Supervi
2020
sory
45ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Commi
ttee
Ren Supervi Incumb 15 May
Male 42 2000 0 0 0 0 0 2000
Wei sor ent 2018
17
Li Supervi Incumb
Female 44 April 0 0 0 0 0 0 0
Yufei sor ent
2012
Feng 2
Supervi Incumb
Hongw Male 51 March 0 0 0 0 0 0 0
sor ent
ei 2017
27
Supervi Incumb
Lin Jun Female 53 April 0 0 0 0 0 0 0
sor ent
2016
28
Wei
Vice Incumb Septem
Hanpin Female 56 0 0 0 0 0 0 0
GM ent ber
g
2012
Zhang
Vice Incumb 15 July
Hongw Male 56 0 0 0 0 0 0 0
GM ent 2020
ei
Secreta 31
ry of Incumb Decem
Luo Yi Male 48 0 0 0 0 0 0 0
the ent ber
Board 2020
31
Zhao 11
Directo Decem
Zhongli Former Male 52 October 0 0 0 0 0 0 0
r ber
ang 2021
2020
1422
Zhao
Decem Septem
Zhongli CFO Former Male 52 0 0 0 0 0 0 0
ber ber
ang
20202021
Total -- -- -- -- -- -- 12000 0 0 0 0 0 12000 --
Indicate by tick mark whether any directors or supervisors left or any senior management were disengaged during the Reporting
Period
√ Yes □ No
Change of Directors Supervisors and Senior Management
√Applicable □ Not applicable
Name Office title Type of change Date of change Reason for change
Zhao Zhongliang D irector Left 11 October 2021 Job change
46ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
22 September
Zhao Zhongliang CFO Left Job change
2021
2. Biographical Information
Professional backgrounds major work experience and current duties in the Company of the incumbent directors supervisors and
senior management:
1. Liu zhengyu: he once was the director of Inspection Department in State-owned Assets Supervision and
Administration Commission of the People’s Government of Shenzhen Municipal Chief Accountant vice GM and
member of CPC of Shenzhen Investment Holdings Co. Ltd. Now he acts as the executive director president and
Vice Secretary of CPC of Shenzhen International Holdings Limited the Chairman of the Board secretary of CPC
of the Company.
2. 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 of the Company and secretary of the Board of the Company. He is currently the director GM and deputy
secretary of the CPC of the Company.
3. 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.
4. 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.
5. 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.
6. 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.
7. 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.
8. He Zuowen: formerly associate professor of accounting 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 director of Shenzhen Institute of Certified Public Accountants 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
47ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Branch Chairman of Shenzhen Tianye Tax Agent Co. Ltd. and also served as the independent director of
Shenzhen JPT Opto-Electronics Co. Ltd. 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
Guangdong Provincial Senior Accountant Review Committee external master tutor of Shenzhen University
member of the Shenzhen Municipal Social Organization Disciplinary Inspection Committee of the Communist
Party of China 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.
9. Mi Xuming: Former lecturer 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
associate professor and master tutor of Shenzhen University and at the same time as the independent directors of
ChinaLin Securities Co. Ltd. Shenzhen Farben Information Technology Co. Ltd. and the Company.
10. Li Lian: Former Deputy Director and Deputy Secretary of the Party Branch of Shenzhen Foreign Economic
and Trade Service Center Secretary of the Disciplinary Committee and Chairman of the Supervisory Committee
of Shenzhen Shentou Education Co. Ltd.; currently Chairman of the Supervisory Committee Secretary of the
Disciplinary Committee and member of CPC of the Company.
11. 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.
12. 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.
13. Feng Hongwei: he once was the Vice Chief of the Board Secretariat and the Securities Representative. Now
he acts as the supervisor member of the Disciplinary Committee and minister of Audit Department of the
Company.
14. 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).
15. Wei Hanping: she ever worked as the manager of the Leasing Operation Department in Shenzhen City
Construction Development (Group) Co. and the manager of Cost Control Department of the Company. And she
now serves as the Vice GM and member of CPC of the Company.
16. 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.
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
Name Shareholding entity Office held in Start of tenure End of tenure Remuneration or
48ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
the allowance from the
shareholding shareholding entity
entity
Vice GM
Liu Zhengyu Shenzhen Investment Holdings Co. Ltd member of 9 January 2017 9 August 2021 Yes
CPC
Chief of
Financial
11 November
Sun Minghui Shenzhen Investment Holdings Co. Ltd Department Yes
2020
(Settlement
Center)
Vice minister
18 September
Ren Wei Shenzhen Investment Holdings Co. Ltd of Audit Yes
2017
Department
Deputy
Director of
Li Yufei Shenzhen Investment Holdings Co. Ltd Discipline 9 July 2015 Yes
Inspection
Office
Offices held concurrently in other entities:
√Applicable □Not applicable
Remuneration or
Office held in
Name Other entity Start of tenure End of tenure allowance from
the entity
the entity
Executive
director
president and
Liu Zhengyu Shenzhen International Holdings Limited 19 August 2021 Yes
Vice
Secretary of
CPC
China's State Owned Capital Venture 9 September
Liu Zhengyu Director 16 August 2016 No
Capital Fund 2021
Liu Zhengyu Kashi Shenzhen City Co. Ltd. Director 8 October 2013 18 October 2021 No
Non-executiv
Shenzhen Investment Holdings Bay Area e director 30 December
Liu Zhengyu 14 March 2018 No
Development Co. Ltd. Chairman of 2021
the Board
Shenzhen Investment International Capital 18 December
Liu Zhengyu Director 18 October 2021 No
Holdings Infrastructure Co. Ltd. 2017
Shenzhen Investment International Capital 9 September
Liu Zhengyu Director 18 October 2021 No
Holdings Co. Ltd. 2016
49ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
December 12
Liu Zhengyu Tsinghua Tri Shenzhen Co. Ltd. Director 18 October 2021 No
2019
SIHC Hong Kong Investment Holdings
Liu Zhengyu Director March 11 2019 18 October 2021 No
Limited
Research Institute of Tsinghua University in Member of a
Liu Zhengyu April 10 2018 18 October 2021 No
Shenzhen council
Director GM
Shenzhen Bay Technology Development and Vice December 2
Wen Li Yes
Co. Ltd. Secretary of 2016
CPC
Hubei SIHC Investment Development Co. 1 February
Wen Li Director No
Ltd. 2018
Director GM
Shenzhen Chuangke Park Investment Co. 30 December
Wen Li and legal No
Ltd. 2021
representative
Chengdu Xingjin Bailuwan Construction Chairman of
Wen Li 7 July 2021 No
and Development Co. Ltd. the Board
China Nanshan Development (Group) Co. October 17
Sun Minghui Supervisor No
Ltd. 2017
Shenzhen Highway Passenger
Sun Minghui Supervisor June 16 2017 No
Transportation Service Centre Co. Ltd.China Science And Technology
Sun Minghui Supervisor June 27 2017 No
Development Co. Ltd.ULTRARICH INTERNATIONAL November 11
Sun Minghui Director No
LIMITED 2020
November 11
Sun Minghui China Southern Fund Management Co. Ltd. Supervisor April 28 2021 No
2020
Hubei SIHC Investment Development Co. November 11
Sun Minghui Director No
Ltd. 2020
February 10
Sun Minghui Shenzhen Textile (Holdings) Co. Ltd. Director No
2021
Shenzhen Shenzhen-Hong Kong Science
October 18
Sun Minghui and Technology Innovation Cooperation Director No
2021
Zone Development Co. Ltd.Shenzhen Sungang China Resources Land October 17
Ren Wei Supervisor No
Development Co. Ltd. 2017
November 19
Li Yufei Shenzhen Dapengwan Huaqiao Tomb Director No
2015
Deng Shenzhen Leaguer Co. Ltd. Director 15 June 2020 No
50ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Kangcheng
4 November
Wei Hanping Shenzhen Talents Housing Group Co. Ltd. Director No
2021
Shenzhen Special Zone Construction 4 November
Wei Hanping Director No
Engineering Group Co. Ltd. 2021
December 2
Kang Xiaoyue Beijing Weiheng (Shenzhen) Law Firm Senior partner Yes
2019
Dahua Certified Public Accountants December 1
He Zuowen Partner Yes
(Special General Partnership) 2002
Chairman of December 1
He Zuowen Shenzhen Tianye Tax Agency Co. Ltd. Yes
the Board 2008
Independent
He Zuowen Shenzhen JPT Opto-Electronics Co. Ltd. June 1 2017 Yes
director
Independent
He Zuowen Shenzhen Textile (Holdings) Co. Ltd. July 19 2017 Yes
director
Independent
He Zuowen Shenzhen Bioeasy Biotechnology Co. Ltd. October 1 2017 Yes
director
Independent October 11
He Zuowen Shenzhen Tongyi Industry Co. Ltd. Yes
director 2018
Associate
December 1
Mi Xuming Shenzhen University professor and Yes
2009
master tutor
Independent
Mi Xuming ChinaLin Securities Co. Ltd. April 10 2017 Yes
director
Shenzhen Farben Information Technology Independent January 29
Mi Xuming Yes
Co. Ltd. director 2021
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:
1. The remuneration of the Company's directors supervisors and senior managers shall be determined and implemented in accordance
with the regulations of the Company's remuneration management system.
2. After the review and approval at the 2013 Annual General Meeting of Shareholders held on April 23 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.
51ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Remuneration of directors supervisors and senior management for the Reporting Period
Unit: RMB’0000
Total before-tax
Any
Incumbent/Forme remuneration
Name Office title Gender Age remuneration
r from the
from related party
Company
Chairman of the
Liu Zhengyu Male 52 Incumbent Yes
Board
Tang Xiaoping Director and GM Male 52 Incumbent 122.22 No
Deng Kangcheng Director Male 56 Incumbent 109.43 No
Wang Jianfei Director and CFO Male 49 Incumbent 9.63 No
Wen Li Director Female 53 Incumbent Yes
Sun Minghui Director Male 41 Incumbent Yes
Independent
Kang Xiaoyue Male 58 Incumbent 8.4 No
director
Independent
He Zuowen Male 60 Incumbent 8.4 No
director
Independent
Mi Xuming Male 47 Incumbent 8.4 No
director
Chairman of the
Li Lian Supervisory Female 55 Incumbent 101.70 No
Committee
Ren Wei Supervisor Male 42 Incumbent Yes
Li Yufei Supervisor Female 44 Incumbent Yes
Feng Hongwei Supervisor Male 51 Incumbent 63.15 No
Lin Jun Supervisor Female 53 Incumbent 63.15 No
Wei Hanping Vice GM Female 56 Incumbent 105.31 No
Zhang Hongwei Vice GM Male 56 Incumbent 98.46 No
Secretary of the
Luo Yi Male 48 Incumbent 65.62 No
Board
Zhao Zhongliang Director and CFO Male 52 Former 80.77 No
Total -- -- -- -- 844.64 --
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
52ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Announcement on Resolutions
of the 60th Meeting of the 7th
Board of Directors (No.:
The 60th Meeting of the 7th Board
19 March 2021 20 March 2021 2021-004) disclosed on China
of Directors
Securities Journal Securities
Times Ta Kung Pao and
www.cninfo.com.cn.Announcement on Resolutions
of the 61st Meeting of the 7th
Board of Directors (No.:
The 61st Meeting of the 7th Board
28 April 2021 29 April 2021 2021-012) disclosed on China
of Directors
Securities Journal Securities
Times Ta Kung Pao and
www.cninfo.com.cn.Announcement on Resolutions
of the 62nd Meeting of the 7th
Board of Directors (No.:
The 62nd Meeting of the 7th Board
30 April 2021 6 May 2021 2021-018) disclosed on China
of Directors
Securities Journal Securities
Times Ta Kung Pao and
www.cninfo.com.cn.Announcement on Resolutions
of the 63rd Meeting of the 7th
Board of Directors (No.:
The 63rd Meeting of the 7th Board
30 June 2021 1 July 2021 2021-023) disclosed on China
of Directors
Securities Journal Securities
Times Ta Kung Pao and
www.cninfo.com.cn.Announcement on Resolutions
of the 64th Meeting of the 7th
Board of Directors (No.:
The 64th Meeting of the 7th Board
20 August 2021 21 August 2021 2021-027) disclosed on China
of Directors
Securities Journal Securities
Times Ta Kung Pao and
www.cninfo.com.cn.Announcement on Resolutions
of the 65th Meeting of the 7th
Board of Directors (No.:
The 65th Meeting of the 7th Board
27 August 2021 28 August 2021 2021-028) disclosed on China
of Directors
Securities Journal Securities
Times Ta Kung Pao and
www.cninfo.com.cn.
53ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Announcement on Resolutions
of the 66th Meeting of the 7th
Board of Directors (No.:
The 66th Meeting of the 7th Board
22 September 2021 23 September 2021 2021-033) disclosed on China
of Directors
Securities Journal Securities
Times Ta Kung Pao and
www.cninfo.com.cn.Announcement on Resolutions
of the 67th Meeting of the 7th
Board of Directors (No.:
The 67th Meeting of the 7th Board
19 October 2021 20 October 2021 2021-042) disclosed on China
of Directors
Securities Journal Securities
Times Ta Kung Pao and
www.cninfo.com.cn.Announcement on Resolutions
of the 68th Meeting of the 7th
Board of Directors (No.:
The 68th Meeting of the 7th Board
25 October 2021 26 October 2021 2021-044) disclosed on China
of Directors
Securities Journal Securities
Times Ta Kung Pao and
www.cninfo.com.cn.Announcement on Resolutions
of the 69th Meeting of the 7th
Board of Directors (No.:
The 69th Meeting of the 7th Board
13 December 2021 14 December 2021 2021-049) disclosed on China
of Directors
Securities Journal Securities
Times Ta 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
Total number Board The director
Board
of board Board meetings Board failed to attend
meetings General
meetings the meetings attended by meetings the two
Director attended meetings
director was attended on way of director failed consecutive
through a attended
eligible to site telecommunica to attend board meetings
proxy
attend tion (yes/no)
Liu Zhengyu 10 5 5 0 0 No 4
Tang Xiaoping 10 5 5 0 0 No 4
Deng Kangcheng 10 5 5 0 0 No 4
54ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Wang Jianfei 3 1 2 0 0 No 1
Wen Li 10 3 7 0 0 No 1
Sun Minghui 10 5 5 0 0 No 2
Kang Xiaoyue 10 5 5 0 0 No 4
He Zuowen 10 2 8 0 0 No 4
Mi Xuming 10 5 5 0 0 No 4
Zhao Zhongliang 7 4 3 0 0 No 2
Why any independent director failed to attend two consecutive board meetings:
Not applicable
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
Details
Other
Number about
informatio
of issues
Important opinions and n about
Committee Members meetings Convened date Content with
suggestions raised the
convene objection
performan
d s
ce of duty
(if any)
Strategic Liu Zhengyu Deliberation on It is believed that the
Committee of Tang Xiaoping the acquisition Company’s acquisition of
1 30 April 2021
the Board of Wen Li Mi of 51% equity 51% equity interest in
Directors Xuming Kang interest in Guangdong Jianbang Group
55ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Xiaoyue Guangdong (Huiyang) Industrial Co.Jianbang Group Ltd. will effectively increase
(Huiyang) the Company’s land reserve
Industrial Co. resources which is
Ltd. conducive to the sustainable
development of the
Company in the future; the
project has good economic
benefits is conducive to
enhancing the Company’s
future business performance
and profitability and is in
line with the interests of the
Company and all
shareholders.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 Business Enterprises.Deliberation on
The Company has always
the Company’s
20 January 2021 been cautious about changes
2020 financial
in accounting policies and
statements
accounting estimates. There
Audit
He Zuowen is no use or abuse of
Committee of
Sun Minghui 4 changes in accounting
the Board of
Mi Xuming policies or accounting
Directors
estimates to adjust profits.The financial statements
prepared by the Company
are true and reliable with
complete contents.It is believed that the
Deliberation on
Company’s 2020 financial
the preliminary
statements prepared by
audit opinions of
Grant Thornton China
16 March 2021 Grant Thornton
(LLP) comply with all
China (LLP) on
provisions of the
the Company’s
Accounting Standards for
2020 financial
Business Enterprises and
56ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
statements truly and completely
represent the Company’s
financial position as of 31
December 2020 and its
operating results and cash
flows for the year 2020 in
all material respects.Deliberation on
the summary of
It is believed that Grant
the 2020 audit
Thornton China (LLP) has
service provided
19 March 2021 completed the audit of the
by Grant
Company’s 2020 financial
Thornton China
statements well.(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
2020 financial statements
Deliberation on
and internal control Grant
the proposed
25 June 2021 Thornton was able to
renewal of the
earnestly perform its duties
audit firm
in accordance with the
requirements of the auditing
standards and the Basic
Code for Internal Control of
Enterprises. It
independently objectively
and fairly evaluated the
Company’s financial
position and operating
results demonstrating
occupational ethics and
professional competence.Therefore it is proposed to
57ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
the Company’s Board of
Directors that Grant
Thornton should be renewed
as the auditing agency for
the Company’s 2021
financial statements and
internal control.It is believed that the
remuneration
Deliberation on decision-making procedures
the annual for the Company’s directors
remuneration of supervisors and senior
Remuneration directors management are compliant
Mi Xuming
and Appraisal supervisors and the remuneration payment
Zhao
Committee of 1 19 March 2021 senior standards for the Company’s
Zhongliang He
the Board of management as directors supervisors and
Zuowen
Directors disclosed in the senior management are in
Company’s line with the regulations of
2020 annual the remuneration system
report and that the remuneration
disclosed in the 2020 annual
report is true and accurate.It is believed that Mr. Wang
Jianfei is not involved in the
circumstances stipulated in
Article 146 of the Company
Law that prohibit him from
serving as a director or a
senior management
member has never received
Deliberation on
punishment by the China
the nomination
Nomination Kang Xiaoyue Securities Regulatory
of Mr. Wang
Committee of Deng 14 September Commission and other
1 Jianfei as the
the Board of Kangcheng He 2021 relevant authorities or
Company’s
Directors Zuowen disciplinary action by the
director and
stock exchange has not
CFO
been placed on file for
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
58ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
regulations is not a
defaulter is not a person
held liable or punished for
dishonesty and has the
qualifications required by
relevant laws
administrative regulations
departmental rules and
normative documents. It is
agreed that Mr. Wang
Jianfei may be
recommended as the
Company’s director and
CFO and that the relevant
proposal should be
submitted to the 66th
Meeting of the 7th Board of
Directors of the Company
for deliberation.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 at
109
the period-end
Number of in-service employees of major subsidiaries at the
1469
period-end
Total number of in-service employees at the period-end 1578
Total number of paid employees in the Reporting Period 1575
Number of retirees to whom the Company as the parent or its
0
major subsidiaries need to pay retirement pensions
Functions
Function Employees
Production 950
59ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Sales 79
Technical 422
Financial 53
Administrative 74
Total 1578
Educational backgrounds
Category Number
Doctors 1
Masters 15
Bachelors 175
College graduates 214
Technical secondary school graduates 88
High school graduates and below 1085
Total 1578
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.
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
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
60ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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) 0.88
Total shares as the basis for the profit distribution 1011660000
proposal (share)
Cash dividends (RMB) (tax inclusive) 89026080.00
Cash dividends in other forms (such as share
0.00
repurchase) (RMB)
Total cash dividends (including those in other
89026080.00
forms) (RMB)
Distributable profit (RMB) 220836309.93
Total cash dividends (including those in other
100%
forms) as % of 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 2021 was reviewed and approved by the 71st Meeting of the 7th Board of Directors held on 17 March
2022 and intended to be submitted to The 2021 Annual General Meeting for review. Based on the total 1011660000 shares of the
Company as at 31 December 2021 a cash dividend of RMB0.88 (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 Shareholders’ 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
61ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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 Countermeasures Settlement Follow-up
Subsidiary Integration plan Problem
progress taken progress settlement plan
Jianbang Group
has been included
in the scope of the
Company’s
consolidated
statements. The
During the
construction for
Reporting Period
Linxinyuan
the Company
Project developed
Guangdong acquired 51%
by the Company
Jianbang Group equity interest in
was successfully
(Huiyang) Jianbang Group. N/A N/A N/A N/A
resumed at the
Industrial Co. The equity
end of June 2021
Ltd. registration
and the Phase I
change was
was pre-sold in
completed in
mid-December.mid-May 2021.At present the
company’s
operation and
management are
being carried out
as planned.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 2022
62ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
self-evaluation report
Index to the disclosed internal control
2021 Internal Control Self-Evaluation Report on www.cninfo.com.cn
self-evaluation report
Evaluated entities’ combined assets as % of
85.58%
consolidated total assets
Evaluated entities’ combined operating
revenue as % of consolidated operating 99.16%
revenue
Identification standards for internal control weaknesses
Weaknesses in internal control over financial Weaknesses in internal control not
Type
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 influence scope and other factors. If
The Company in line with the actual the follows events or indicators occur
situation when the follows events or there may be serious or important defects
indications happen which means there of internal control in the non-financial
probably existing serious or important statements:(1) Lack democratic
defects in the financial report; (1) the decision-making process if lack
directors supervisors and senior executives significant problem decision-making
were fraud. (2) Certified Public Accountant important appointment and dismissal of
find that there is a significant error in the cadres significant project investment
Nature standard
financial report however the internal control decision-making; usage of large capital
did not discover it when conducting internal (three important one large); (2)
control; (3) The Audit Committee under the Unscientific decision-making process
Board and Internal Audit Service's such as the major decision-making
supervision to the internal control is invalid. errors has caused a serious property loss
(4) The accounting personnel were without to the company; (3) Seriously violating
necessary qualities to complete the state laws and regulations; (4) Loss of
preparation of financial statements. key management personnel or important
talent; (5) 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.Quantitative standard Serious defects: the defects or defect group The criterion of quantity of the
63ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
may lead to the financial results recognition of defects of internal control
misstatement or potential losses >3% of net in the non-financial statements mainly
assets; important defects: 1% of net were amount of direct economy losses in
assets
to the financial results misstatement or recognition of defects of internal control
potential losses ≤ 3% of net assets; General in financial report of the Company.defects: the defects or defect group may
lead to the financial results misstatement or
potential losses ≤ 1% of net assets. Note: Net
assets in a recent issue of the audited
financial report shall prevail
Number of material weaknesses in internal
0
control over financial reporting
Number of material weaknesses in internal
0
control not related to financial reporting
Number of serious weaknesses in internal
0
control over financial reporting
Number of serious weaknesses in internal
0
control not related to financial reporting
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 2021 in accordance with Basic Standards for Internal Control and
relevant regulations.Independent auditor’s report on
Disclosed
internal control disclosed or not
Disclosure date 18 March 2022
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.
64ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
√ 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 during the Reporting Period.
2. The transition of the 7th Board of Directors and the 7th Board of Supervisors of the Company has not been
completed as scheduled due to the planning of major asset restructuring (already terminated). The 7th Board of
Directors of the Company consists of nine members (including three independent directors). So far seven members
have been changed (all the three independent directors have been changed). The Board of Supervisors consists of
five members and four members have been changed. The Company has communicated with the controlling
shareholder about initiating the transition of the Board of Directors and the Board of Supervisors and will continue
to maintain communication with the controlling shareholder to complete the transition of the Board of Directors and
the Board of Supervisors as soon as possible.
65ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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 environmental
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
The Company has proactively fulfilled its social responsibilities. While pursuing economic benefits and protecting
the interests of shareholders it complied with the overall development of the country and society protected the
legal rights of creditors and employees and treated the suppliers customers and consumers with integrity.Participating in the public welfare undertakings positively the Company took efforts in keeping a harmonious
development of the Company itself and the whole society. During the Reporting Period the Company continued
to deepen its volunteer services. It organized the “SPG with Love Supporting People’s Livelihood”environmentally friendly clothing donation and jointly launched the public welfare activity of “Positive Energyfrom the Youth to the Party” with Shenzhen Good Youth Technology Innovation Development Co. Ltd. Also the
Company collaborated with community workstations to prevent and control the pandemic assisted in the
completion of nucleic acid testing in 27 communities and provided “Buy and Deliver” door-to-door services.With respect to the actual difficulties brought to Tianyuewan Community by the water supply measure that water
supply is made available for three days and then cut off for five days the increase of water supply channels was
adopted to properly solve the drinking water problem for the residents of the community. Besides in accordance
with the idea of “creating a civilized community” in Jiabei Community the Company actively participated in the
voluntary activity of traffic civilization persuasion. 162 people volunteered throughout the year. At the same time
the Company supported the work of family affairs in the region and donated RMB30000 in the charity
fund-raising activity of “Joining Hands on Fertility Care Caring for Families in Need” of Jiabei Community. It
66ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
also donated property management equipment worth RMB230000 to Cuizhuyuan Community Cuizhu
Sub-district Luohu District to help build Cuizhuyuan into a happy community.III Consolidation and Expansion of Poverty Alleviation Outcomes and Rural Revitalization
During the Reporting Period the Company actively promoted the special action of poverty alleviation. The
purchases for poverty alleviation in the system totaled RMB800000 throughout the year helping to consolidate
poverty alleviation outcomes.
67ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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
Date of Term of
Type of
Commitment Promisor Details of commitment commitment commitme Fulfillment
commitment
making nt
Commitments made in
share reform
Commitments made in
acquisition documents or
shareholding alteration
documents
The Company's major asset
restructuring was terminated and
trading of the stocks was resumed
on 9 November 2020. The
Commitments made in The Asset Company promises that it will not 9 November Two
Completed
time of asset restructuring Company restructuring i nitiate the major asset 2020 months
restructuring after the
announcement of termination was
disclosed within at least two
months.Commitments made in
time of IPO or refinancing
Equity incentive
commitments
To avoid horizontal competition
Shenzhen Investment Holdings
Shenzhen Co. Ltd. made such a
Avoiding Before 9
Other commitments made Investment commitment: For the Company’s 10 September
horizontal November Ongoing
to minority interests Holdings existing business that has 2021
competition 2024
Co. Ltd. horizontal competition with
ShenZhen Properties & Resources
Development (Group) Ltd.
68ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Shenzhen Investment Holdings
Co. Ltd. will within the scope
permitted by laws and regulations
timely launch one or several of
the following solutions that is
practically feasible and complete
the implementation of the relevant
solution(s) before 9 November
2024 to solve the existing
horizontal competition problem:
(1) Solve the horizontal
competition between the two
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 on time Yes
Specific reasons for
failing to fulfill
commitments on time and N/A
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.
69ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
III Irregularities in the Provision of Guarantees
□ Applicable √ Not applicable
No such cases in the Reporting Period.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
Please refer to “33. Changes in significant accounting policies and accounting estimates” of “III. Significant accounting policies andaccounting estimates” in “Part X Financial Statements” for details.VII YoY Changes to the Scope of the Consolidated Financial Statements
√ Applicable □ Not applicable
See “VI Changes to the scope of consolidation” in “Part X Financial Statements”.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
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 3
service for the Company
Indicate by tick mark whether the independent auditor was changed for the Reporting Period.□ Yes √ No
70ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Independent auditor financial advisor or sponsor engaged for the audit of internal controls:
√Applicable □ Not applicable
The Company engaged Grant Thornton China (LLP) for the audit of internal controls with payment of RMB0.23 million in the
Reporting Period.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.XI Major Legal Matters
√Applicable □ Not applicable
Involved Index to
Decisions and Execution of Disclosure
General information amount Provision Progress disclosed
effects decisions date
(RMB’0000) information
? Xi’an Business Shaanxi High
Tourism People’s Court
Company Limited Sold all assets
(hereinafter of Business
referred to as Company by“Business auction inCompany”) had accordance with
to pay for the laws in 2004.compensation The applicant Interim
RMB36.62 has received Report 2021
million and the RMB15.20 (full text)
Xi’an Project In 28 August
2100 No relevant interest million. Now (No.:
Lawsuit execution 2021
(from 14 Business 2021-031) on
September 1998 Company has www.cninfo.to the payment no executable com.cn
day) to Xi’an properties and
Fresh Peak Xi’an Joint
Company within Commission on
one month after Commerce has
the judgment been refusing to
entering into execute the
force. If the ruling. It is
Business difficult to
71ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Company failed recover the rest.to pay in time it
had to pay double
debt interests to
Xi’an Fresh Peak
Company for the
overdue period;
* Xi’an Joint
Commission on
Commerce had
jointly and
severally
obligation of the
interests of the
compensation; .* Business
Company shall
bear
RMB227500 of
the acceptance
fee and the
security fee.XII Punishments and Rectifications
□ Applicable √ Not applicable
No such cases in the Reporting Period.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.
72ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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
th th rd
reviewed and approved on the 69 Meeting of the 7 Board of Directors and the 3 Extraordinary General
Meeting of 2021 of the Company.Index to announcements on major related-party transactions
Announcement Disclosure time Disclosure website
Announcement on Resolutions of the 69th
Meeting of the 7th Board of Directors (No.: 14 December 2021 www.cninfo.com.cn
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 3rd
30 December 2021 www.cninfo.com.cn
Extraordinary General Meeting of 2021 (No.:
73ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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)
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
No such cases in the Reporting Period.
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 130000 51402.47 0 0
74ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Total 130000 51402.47 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
In order to implement the plan of the State Council for transferring parts of state-owned capital to enrich the social
security fund in January 2021 SIHC the controlling shareholder of the Company decided to transfer 64288426
tradable ordinary A-shares of the Company (accounting for 6.355% of the total share capital) to Shenzhen
State-owned Equity Management Co. Ltd. (hereinafter referred to as "State-owned Equity Company") free of
charge to enrich the social security fund State-owned Equity Company is a wholly-owned subsidiary newly
established by SIHC to manage the transferred state-owned equity in a special account. In March 2021 the
registration procedure for the above share transfer was completed. Before and after the free transfer of
state-owned equity the controlling shareholder and actual controller of the Company remained unchanged. For
more details see the Suggestive Announcement on the Free Transfer of Parts of State-owned Equity of
Controlling Shareholders to Enrich the Social Security Fund (Announcement No. 2021-001) and the
Announcement on the Completion of Free Transfer Registration of Parts of State-owned Equity of Controlling
Shareholders to Enrich the Social Security Fund (Announcement No. 2021-003) disclosed on 29 January and 18
March 2021.After deliberation and approval at the 2020 General Meeting of Shareholders the Company decided to purchase
liability insurance for Directors Supervisors and Senior Managers. For more details please refer to the
Announcement on Purchasing Liability Insurance for Directors Supervisors and Senior Managers
(Announcement No. 2021-008) and the Announcement on the Resolution of the 2020 General Meeting of
Shareholders (Announcement No. 2021-011) disclosed on 20 March and 29 April 2021. During the Reporting
Period the issue regarding Liability Insurance for Directors Supervisors and Senior Managers has been
completed.After deliberation and approval at the 61st Meeting of the 7th Board of Directors the Company purchased wealth
management products of RMB1.3 billion with its own funds in June 2021 which has been partly redeemed in the
Reporting Period. For more details see the Announcement on Resolutions of the 61st Meeting of the 7th Board of
Directors (Announcement No. 2021-012) the Announcement on Authorizing the Management Group to Use Own
75ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Funds to Purchase Wealth Management Products (Announcement No. 2021-017) the Announcement on the
Progress of Using Own Funds to Purchase Wealth Management Products (Announcement No. 2021-022) and the
Announcement on the Progress of Using Own Funds to Purchase Wealth Management Products (Announcement
No. 2021-036) disclosed on 29 April 4 June and 24 September 2021.After deliberation and approval at the 62nd Meeting of the 7th Board of Directors the Company decided to
acquire 51% equity of Guangdong Jianbang Group (Huiyang) Industrial Co. Ltd. held by Guangzhou Bopi
Enterprise Management Consulting Co. Ltd. with its own capital of RMB450 million. Transaction transfer and
registration changes were completed in the Reporting Period. For more details see the Announcement on
Resolutions of the 62nd Meeting of the 7th Board of Directors (Announcement No. 2021-018) the Announcement
on Acquisition of 51% Equity of Guangdong Jianbang Group (Huiyang) Industrial Co. Ltd. (Announcement No.
2021-019) and the Announcement on Progress of Acquisition of 51% Equity of Guangdong Jianbang Group
(Huiyang) Industrial Co. Ltd. (Announcement No. 2021-020) disclosed on 6 May and 15 May 2021.The Measures for the Management of Employees' Co-investment and the Measures for the Management of
Employees' Co-investment of Linxijun Project were deliberated and approved at the 63rd Meeting of the 7th
Board of Directors and the 2021 First Extraordinary General Meeting. For more details see the Announcement on
Resolutions of the 63rd Meeting of the 7th Board of Directors (Announcement No. 2021-023) and the
Announcement on Resolutions of the 2021 First Extraordinary General Meeting of Shareholders (Announcement
No. 2021-026) disclosed on 1 July and 17 July 2021. During the Reporting Period co-investing employees made
project co-investments through partnership establishment and completed the payment of the subscription funds for
the co-investments.During the Reporting Period the Company received the Letter of Commitment on Avoiding Horizontal
Competition from Shenzhen Investment Holdings Co. Ltd. the controlling shareholder. For more details see the
Announcement on Receiving the Letter of Commitment on Avoiding Horizontal Competition from the Controlling
Shareholder (Announcement No. 2021-032) disclosed on 11 September 2021 and the Announcement on
Resolutions of the 2021 First Extraordinary General Meeting of Shareholders (Announcement No. 2021-34)
disclosed by ShenZhen Properties & Resources Development (Group) Ltd. on 27 September 2021.On 28 September 2021 the Company participated in the land use right assignment activity through quotation held
by the Land and Mining Rights Business Branch of Shenzhen Exchange Group Co. Ltd. and won the use right of
No. A511-0039 state-owned land with RMB965 million. After deliberation and approval at the 67th Meeting of the
7th Board of Directors the Company established a wholly owned subsidiary (Shenzhen SPG Chuanqi Real Estate
Development Co. Ltd.) to facilitate the development and construction of the aforesaid land. For more details see
the Announcement on Winning the Bid of State-owned Land Use Right (Announcement No. 2021-039) the
Announcement on Resolutions of the 67th Meeting of the 7th Board of Directors (Announcement No. 2021-042)
the Announcement on the Investment and Construction of No. A511-0039 Land in Guangming District and the
Establishment of Shenzhen SPG Group Guangming Development Co. Ltd. (Announcement No. 2021-043) and the
Announcement on the Progress of Wholly Owned Subsidiary Establishment (Announcement No. 2021-048)
disclosed on 30 September 2021 20 October 2021 and 1 November 2021.XVII Significant Events of Subsidiaries
□ Applicable √ Not applicable
76ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Part VII Share Changes and Shareholder Information
I Share Changes
1. Share Changes
Unit: share
Before Increase/decrease (+/-) After
Shares as
Shares as
dividend
dividend Percentag New converted Percentag
Shares converted Other Subtotal Shares
e (%) issues from e (%)
from
capital
profit
reserves
1. Restricted shares 0 0.00% 0 0 0 0 0 0 0.00%
1.1 Shares held by the state 0 0.00% 0 0 0 0 0 0 0.00%
1.2 Shares held by state-own
00.00%0000000.00%
Legal-person
1.3 Shares held by other
00.00%0000000.00%
domestic investors
Among which: shares held by
00.00%000000.00%
domestic legal person
Shares held by domestic
00.00%0000000.00%
natural person
1.4 Oversea shareholdings 0 0.00% 0 0 0 0 0 0.00%
Among which: shares held by
00.00%0000000.00%
oversea legal person
Shares held by oversea
00.00%0000000.00%
natural person
10116601011660
2. Unrestricted shares 100.00% 0 0 0 0 0 100.00%
000000
89166008916600
2.1 RMB ordinary shares 88.14% 0 0 0 0 0 88.14%
0000
2.2 Domestically listed 1200000 1200000
11.86%0000011.86%
foreign shares 00 00
2.3 Oversea listed foreign
00.00%0000000.00%
shares
2.4 Other 0 0.00% 0 0 0 0 0 0 0.00%
77ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
10116601011660
3. Total shares 100.00% 0 0 0 0 0 100.00%
000000
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:
□ 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
ordinary preferred
Number of preferred
shareholders at shareholders
ordinary 55596 53831 shareholders with 0 0
the month-end with resumed
shareholders resumed voting
prior to the voting rights at
rights (if any)
disclosure of this the month-end
78ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Report prior to the
disclosure of this
Report (if any)
Shareholding of ordinary shareholders holding more than 5% shares or the top 10 of ordinary shareholders
Number Increase Pledged marked or frozen shares
of and
Number Number
Holding sharehold decrease
Name of Nature of of of
percentag ing at the of shares
shareholder shareholder restricted unrestricte Status of shares Amount
e (%) end of the during
shares d shares
Reporting Reporting
Period Period
Shenzhen
State-owned legal 5785958 -6428842 5785958
Investment 57.19%
person 36 6 36
Holdings Co. Ltd
Shenzhen
State-owned Domestic
6428842+64288426428842
Equity non-state-owned 6.35%
666
Management Co. legal person
Ltd.Domestic natural
Yang Jianmin 0.45% 4514677 4514677
person
Domestic natural
Zhang Xiujuan 0.36% 3597300 3597300
person
Domestic natural
Pan Jun 0.33% 3288900 3288900
person
Domestic natural
Lin Weirong 0.31% 3116400 3116400
person
Domestic natural
Wang Yulan 0.23% 2329691 2329691
person
Domestic natural
Zhu Fengbo 0.21% 2100000 2100000
person
Domestic natural
Liu Yuqing 0.21% 2090201 2090201
person
Shenzhen Bao'an Domestic
Songgang Huamei non-state-owned 0.20% 2021200 2021200
Industry Company legal person
Strategic investor or general legal
person becoming a top-10 ordinary None
shareholder due to rights issue (if any)
Related or acting-in-concert parties Among the top 10 shareholders of the Company Shenzhen State-owned Equity
79ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
among the shareholders above Management Co. Ltd. is a wholly-owned subsidiary of Shenzhen Investment Holdings Co.Ltd. The Company does not know whether there exists associated relationship among the
other 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
None
entrusting/being entrusted with voting
rights or waiving voting rights
Special account for share repurchases
None
(if any) among the top 10 shareholders
Top 10 unrestricted shareholders
Shares by type
Name of shareholder Unrestricted shares held at the period-end
Type Shares
Shenzhen Investment Holdings Co. RMB ordinary
578595836578595836
Ltd shares
Shenzhen State-owned Equity RMB ordinary
6428842664288426
Management Co. Ltd. shares
RMB ordinary
Yang Jianmin 4514677 4514677
shares
RMB ordinary
Zhang Xiujuan 3597300 3597300
shares
RMB ordinary
Pan Jun 3288900 3288900
shares
RMB ordinary
Lin Weirong 3116400 3116400
shares
RMB ordinary
Wang Yulan 2329691 2329691
shares
RMB ordinary
Zhu Fengbo 2100000 2100000
shares
RMB ordinary
Liu Yuqing 2090201 2090201
shares
Shenzhen Bao'an Songgang Huamei RMB ordinary
20212002021200
Industry Company shares
Related or acting-in-concert parties Among the top 10 unrestricted public shareholders of the Company Shenzhen State-owned
among top 10 unrestricted public Equity Management Co. Ltd. is a wholly-owned subsidiary of Shenzhen Investment
shareholders as well as between top Holdings Co. Ltd. The Company does not know whether there exists associated
10 unrestricted public shareholders relationship among the other shareholders or whether they are persons acting in concert as
and top 10 shareholders prescribed in the Administrative Measures for the Acquisition of Listed Companies.Top 10 ordinary shareholders involved Among the top 10 shareholders of the Company the third fourth sixth ninth and tenth
80ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
in securities margin trading (if any) shareholders respectively held 1466400 shares 3597300 shares 1957700 shares
(see Note 4) 2010201 shares and 2021200 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
Name of controlling Unified social credit
representative/person Date of establishment Principal activity
shareholder code
in charge
Investment in equities on
behalf of the government
and management of those
investments; development
Shenzhen Investment 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%;
9590000 shares in Shenzhen Universe A (000023) representing a stake of 6.91%;
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 of 8%;
Controlling shareholder’s
195030000 shares in Telling Holding (000829) representing a stake of 19.03%;
holdings in other listed
985640000 shares in Shenzhen International (00152) representing a stake of 43.48%;
companies at home or abroad
604820000 shares in BEAUTYSTAR (002243) representing a stake of 49.96%;
in the Reporting Period
2213450000 shares in Bay Area Development (00737) representing a stake of 71.83%;
315830000 shares in Infinova (002528) representing a stake of 26.35%;
388450000 shares in EA (002183) representing a stake of 14.96%;
49500000 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%;
81ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
77270000 shares in Vanke (02202) representing a stake of 0.66%.
Change of the controlling shareholder in the Reporting Period:
□ Applicable √ Not applicable
No such cases in the Reporting Period.
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
Date of Unified social credit
Name of actual controller representative/per Principal activity
establishment code
son in charge
Perform the responsibilities of
Shenzhen State-owned Assets investor on behalf of the state
Supervision and Administration Wang Yongjian 31 July 2004 K3172806-7 and supervise and manage the
Commission authorized state-owned assets
legally.Other listed companies at home
In addition to the Company controlling shareholder - Shenzhen Investment Holding Co. Ltd.or abroad controlled by the
Other domestic and overseas listed companies whose equity held by the actual controllers did not
actual controller in the
rank among 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:
82ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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
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
83ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Part VIII Preference Shares
□ Applicable √ Not applicable
No preference shares in the Reporting Period.
84ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Part IX Bonds
□ Applicable √ Not applicable
85ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report
2021
Part X Financial Statements
Type of the audit opinion Unmodified unqualified opinion
Date of signing this report 17 March 2022
Name of the audit institution Grant Thornton Accounting Firm (LLP)
Number of the audit report GTCSZ（2022）No. 441A002546
Name of the certified public accountants Zhao Juanjuan Jiang Xiaoming
Auditor’s Report
GTCSZ（2022）No. 441A002546
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 2021 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 financial statement present fairly in all material
respects the consolidated financial position of the group as at 31 December 2021 and i ts
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 responsibilities
under those standards are further described in the Auditor’s Responsibilities for the Audit of the
86ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report
2021
Financial Statement Section of our report. We are independent of the Group in accordance with
the Code of Ethics for Chinese Certified 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 responsibilities 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
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 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 2021 the revenue from sales of properties is CNY 0.876 billion which accounts for 66.34%
of total revenue of the Group.The Group recognizes the revenue of sales of properties when all of the following conditions
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
87ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report
2021
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 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 IV. tax and Note V.36.
88ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report
2021
1. Description of the matter
Land appreciation tax is one of the major tax of the group.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 provisions 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 settles 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 identified the accrual of LAT of the
Group as a key audit matter.
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 2021 on basis of our experience knowledge understanding of the practical
operation of relevant tax laws by local tax authorities to evaluate the Group’s assumptions and
judgments;
89ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report
2021
* 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 estimate
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 4.035 billion yuan accounting for 65.26% 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.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
90ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report
2021
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 2021
with those as of 31 December 2020 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 2021 but does not include the financial
statements and our auditor’s report thereon.Our opinion on the financial 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
91ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report
2021
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 realistic alternative but to do so.Those charge with governance are responsible for overseeing the Group’s financial reporting
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 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 Auditing we exercise professional
92ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report
2021
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 collusion forgery intentional omissions
misrepresentations or the override of internal control.* Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances.* Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by management.* Conclude on the appropriateness of management’s use of the going concern basis of
accounting and based on the audit evidence obtained whether a material uncertainty
exists related to events or conditions that may cast significant 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 evidence obtained up to the date of our auditor’s report. However
further events or conditions 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
entities or business activities within Group to express an opinion on the consolidated
financial statements. We are responsible for the direction supervision and performance of
the group audit. We remain solely responsible for our audit opinion.We communicate with those charged with governance regarding among other matters the
93ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report
2021
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
Auditor's signature and stamp：
China ·Beijing Jiang Xiaoming
94ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report
2021
17 March 2022
95ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Balance Sheet
Prepared by：Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd Expressed in CNY
As at 31/12/2021 As at 31/12/2020
Item Note
Consolidated Company Consolidated Company
Current assets:
Cash at bank and on hand V、1 564358824.63 304130181.74 2687465070.01 2329517987.02
Trading financial assets V、2 514024710.91 514024710.91 - -
Bills receivable V、3 3530537.37 - 35438045.34 -
Accounts receivable V、4 61048785.11 9708285.93 59590944.06 5418024.74
Accounts receivable financing - - - -
Prepayments V、5 4899011.32 200000.00 3205534.51 200000.00
Other receivables V、6 30614008.08 1587300891.76 32745043.84 1160414195.39
including：interests receivables - - - -
dividends receivables 1052192.76 - 1052192.76 -
Inventories V、7 4034933562.62 42348499.39 1220464112.56 207606220.98
Contract assets - - - -
Assets held for sale V、8 78940232.10 12821791.52 - -
Non-current assets due within one year - - - -
Other current assets V、9 68216887.04 7144189.24 102907134.79 945499.13
Total current assets 5360566559.18 2477678550.49 4141815885.11 3704101927.26
Non-current assets:
Debt investments - - - -
Other debt investments - - - -
Long-term receivables - - - -
Long-term equity investments V、10 272168.28 1582657055.03 377489.65 150584167.95
Investment in other equity instruments V、11 36322704.33 13831938.92 37510860.51 13508202.32
Other financial non-current assets - - - -
Investment properties V、12 588865777.16 476622089.39 616365621.53 499145554.67
Fixed assets V、13 23920424.55 15722627.74 28039978.43 17743083.73
Construction in progress - - - -
Productive biological assets - - - -
Oil and gas assets - - - -
Right of use assets V、14 365351.97 - - -
Intangible assets V、15 - - - -
Development costs - - - -
Goodwill - - - -
Long-term deferred expenses V、16 2164963.18 1167500.83 61667.53 61667.53
Deferred tax assets V、17 170020101.78 134299017.38 112745243.98 83740299.64
Other non-current assets - - - -
Total non-current assets 821931491.25 2224300229.29 795100861.63 764782975.84
Total assets 6182498050.43 4701978779.78 4936916746.74 4468884903.10
96ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Balance Sheet(continued)
Prepared by：Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd Expressed in CNY
As at 31/12/2021 As at 31/12/2020
Item Note
Consolidated Company Consolidated Company
Current liabilities:
Short-term loans V、18 50440116.24 - 76893995.94 -
Trading financial liabilities - - - -
Bills payable V、19 247376403.56 - - -
Accounts payable V、20 141447559.24 29750790.44 176926614.28 77187914.50
Advances from customers V、21 6411427.04 - 5940092.15 -
Contract liabilities V、22 199965490.08 159752627.50 196786977.19 172241938.46
Employee benefits payable V、23 43926711.78 33496830.45 60467834.09 27255860.05
Taxes payable V、24 600540872.48 588031923.05 459709646.95 450281265.17
Other payables V、25 581377415.64 207613656.49 277105129.74 194609459.87
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 83023.44 - - -
Other current liabilities V、27 8196849.13 7987260.50 8917027.07 8612096.92
Total current liabilities 1945518320.69 1026633088.43 1262747317.41 930188534.97
Non-current liabilities:
Long-term loans - - - -
Debentures payable - - - -
Leased liabilities V、28 125920.77 - - -
Long-term payables V、29 - - 7480233.43 -
Provisions - - - -
Deferred income - - - -
Deferred tax liabilities V、16 9524639.56 5027520.65 9601940.74 4812392.47
Other non-current liabilities - - - -
Total non-current liabilities 9650560.33 5027520.65 17082174.17 4812392.47
Total liabilities 1955168881.02 1031660609.08 1279829491.58 935000927.44
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 36088963.95 1373954.19 28163050.13 1131151.74
Specific reserve - - - -
Surplus reserve V、33 241144854.93 218015241.52 218724273.67 195594660.26
Retained earnings V、34 1671121562.98 1474557043.86 1560720254.31 1360786232.53
Total equity attributable to shareholders
3938260291.973670318170.703797512488.223533883975.66
of the Company
Non-controlling interests 289068877.44 - -140425233.06 -
Total shareholders' equity 4227329169.41 3670318170.70 3657087255.16 3533883975.66
Total liabilities and
6182498050.434701978779.784936916746.744468884903.10
shareholders' equity
Legal reprensentative: The person in charge of accounting affair s: The head of the accoun ting department:
97ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Income Statement
For the year ended 31 December 2021
Prepared by：Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd Expressed in CNY
Year ended 31/12/2021 Year ended 31/12/2020
Item Note
Consolidated Company Consolidated Company
I.Operating income V、35 1320790648.45 774065610.33 1615009713.88 911839269.70
Less: operating costs V、35 666348361.48 198814980.86 805508448.68 241307783.52
Taxes and surcharges V、36 254360315.85 239589346.99 329962066.50 289600033.09
Selling and distribution expenses V、37 42737748.22 25703001.79 55989397.22 42814758.60
General and administrative expenses V、38 98307831.60 62162730.22 93616226.75 56022941.66
Research and development expenses - - - -
Financial expenses V、39 -18083491.01 -35842822.63 -21505685.05 -39280862.44
Including: Interest expenses - - - -
Interest income 28863878.27 41651307.37 30130066.10 51099467.08
Add: Other income V、40 1669479.40 41188.24 4607772.07 150785.59
Investment income ("-" for losses) V、41 1783839.07 1783839.07 15724469.63 15724469.63
Including: Income from investment in
-105321.37-105321.37-92348.97-92348.97
associates and 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 ("-"
V、42 11828130.44 11828130.44 - -
for losses)
Credit impairment losses ("-" for
V、43 -7795219.71 -153318.35 -358999.15 464438.79
losses)
Impairment losses ("-" for losses) V、44 268941.60 - - -
Gains from assets disposal ("-" for
V、45 -8852.73 - 11429.23 -
losses)
II.Operating profit ("-" for losses) 284866200.38 297138212.50 371423931.56 337714309.28
Add: Non-operating income V、46 1746134.87 1584736.54 30693761.57 30679050.88
Less: Non-operating expenses V、47 208129.74 32989.65 1684103.97 106542.24
III.Profit before income tax ("-" for losses) 286404205.51 298689959.39 400433589.16 368286817.92
Less: Income tax expenses V、48 68804535.78 74484146.80 110470834.78 93272470.62
IV.Net profit for the year ("-" for net losses) 217599669.73 224205812.59 289962754.38 275014347.30
(1) Classification according to operation
continuity
Including: Net profit from continuing operations
214252742.25224205812.59286164165.74275014347.30
("-" for net loss)
Net profit from
3346927.483798588.64
discontinued operations ("-" for net loss)
(2) Classification according to attibute
Including: Shareholders of the company("-" for
220836309.93224205812.59290229772.23275014347.30
net loss)
98ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Income Statement
For the year ended 31 December 2021
Prepared by：Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd Expressed in CNY
Year ended 31/12/2021 Year ended 31/12/2020
Item Note
Consolidated Company Consolidated Company
Non-controlling
-3236640.20--267017.85-
interests("-" for net loss)
V.Other comprehensive income net of tax 8837349.05 242802.45 9065166.63 209025.97
Other comprehensive income (net of tax)
7925913.82242802.457332046.00209025.97
attributable to shareholders of the company
A.Items that will not be reclassified to profit or
-891117.14242802.453288097.86209025.97
loss
a. Changes in fair value of other equity
-891117.14242802.453288097.86209025.97
instrument investments
B. Items that may be reclassified to profit or
8817030.96-4043948.14-
loss
a. Translation differences arising from
8817030.96-4043948.14-
translation of foreign currency financial statements
Other comprehensive income (net of tax)
911435.23-1733120.63-
attributable to non-controlling interests
VI.Total comprehensive income for the year 226437018.78 224448615.04 299027921.01 275223373.27
Attributable to:
228762223.75224448615.04297561818.22275223373.27
Shareholders of the company
Non-controlling interests -2325204.97 - 1466102.78 -
VII.Earnings per share
(1) Basic earnings per share 0.2183 - 0.2869 -
(2)Diluted earnings per share 0.2183 - 0.2869 -
Legal reprensentative: The person in charge of accounting affairs: The head of the accounting department:
Cash Flow Statement
For the year ended 31 December 2021
Prepared by：Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd Expressed in CNY
Year ended 31/12/2021 Year ended 31/12/2020
Item Note
Consolidated Company Consolidated Company
I.Cash flows from operating activities
Proceeds from sales of goods or rendering of
1427249424.24800728093.141729680056.341078103371.61
services
Refund of taxes - - - -
Proceeds from other operating activities V、49 378597082.00 55262411.37 54027940.71 64609945.07
Sub-total of cash inflows 1805846506.24 855990504.51 1783707997.05 1142713316.68
Payment for goods and services 2301256194.02 53822715.55 550912214.50 32909312.44
99ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Cash Flow Statement
For the year ended 31 December 2021
Prepared by：Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd Expressed in CNY
Year ended 31/12/2021 Year ended 31/12/2020
Item Note
Consolidated Company Consolidated Company
Payment to and for employees 191511263.39 55225745.09 164940269.68 41972734.54
Payments of various taxes 235554836.77 276459274.35 708116426.50 183703076.95
Payment for other operating activities V、49 283476320.00 472880097.57 74575073.20 388932614.43
Sub-total of cash outflows 3011798614.18 858387832.56 1498543983.88 647517738.36
Net cash flows from operating
-1205952107.94-2397328.05285164013.17495195578.32
activities
II.Cash flows from investing activities
Proceeds from disposal of investments - - - -
Investment income received 1889160.44 1889160.44 19767503.60 19767503.60
Net proceeds from disposal of fixed assets intangible
162961.511253.5656718.25-
assets and other long-term assets
Net proceeds from disposal of subsidiaries and other
----
business units
Proceeds from other investing activities 797803419.53 797803419.53 1000000000.00 1000000000.00
Sub-total of cash inflows 799855541.48 799693833.53 1019824221.85 1019767503.60
Payment for acquisition of fixed assets intangible
1845495.541283857.85749215.31-
assets and other long-term assets
Payment for acquisition of investments - - - -
Net payment for acquisition of subsidiaries and other
449776436.751444894678.60--
business units
Payment for other investing activities V、49 1300000000.00 1300000000.00 - -
Sub-total of cash outflows 1751621932.29 2746178536.45 749215.31 -
Net cash flows from investing activities -951766390.81 -1946484702.92 1019075006.54 1019767503.60
III.Cash flows from financing activities
Proceeds from investors - - - -
Including: Proceeds from non-controlling shareholders of
----
subsidiaries
Proceeds from borrowings 50440116.24 - 76893995.94 -
Proceeds from other financing activities 215816852.52 22800000.00 - -
Sub-total of cash inflows 266256968.76 22800000.00 76893995.94 -
Repayments of borrowings 76893995.94 - 51647260.17 -
Payment for dividends profit distributions or interest 88014420.00 88014420.00 166923900.00 166923900.00
Including: Dividends and profits paid to
----
non-controlling shareholders of subsidiaries
Payment for other financing activities - - - -
Sub-total of cash outflows 164908415.94 88014420.00 218571160.17 166923900.00
Net cash flows from financing activities 101348552.82 -65214420.00 -141677164.23 -166923900.00
IV.Effect of foreign exchange rate changes on cash
-440345.74--647689.01-
and cash equivalents
V.Net increase in cash and cash equivalents -2056810291.67 -2014096450.97 1161914166.47 1348039181.92
100ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Cash Flow Statement
For the year ended 31 December 2021
Prepared by：Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd Expressed in CNY
Year ended 31/12/2021 Year ended 31/12/2020
Item Note
Consolidated Company Consolidated Company
Add: Cash and cash equivalents at the beginning of
2669103926.822311776619.471507189760.35963737437.55
the year
VI.Cash and cash equivalent at the end of the year 612293635.15 297680168.50 2669103926.82 2311776619.47
L egal reprensentative: The person in charge of ac counting affairs: The he ad of the accounting department:
101ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Consolidated Statement of Changes in Shareholders' Equity
For the year ended 31 December 2021
Prepared by：Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd Expressed in CNY
Year ended 31/12/2021
Attributable to shareholders' equity of the parent company
Item Less: Other Non-controlling
Capital Specific Surplus Retained Total
Share capital treasury comprehensive interests
reserve reserve reserve earnings
shares income
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
---7925913.82-22420581.26110401308.67429494110.50570241914.25
decrease)
(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 - - - - - - - - -
102ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Consolidated Statement of Changes in Shareholders' Equity
For the year ended 31 December 2021
Prepared by：Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd Expressed in CNY
Year ended 31/12/2021
Attributable to shareholders' equity of the parent company
Item Less: Other Non-controlling
Capital Specific Surplus Retained Total
Share capital treasury comprehensive interests
reserve reserve reserve earnings
shares income
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:
103ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Consolidated Statement of Changes in Shareholders' Equity
For the year ended 31 December 2021
Prepared by：Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd Expressed in CNY
Year ended 31/12/2020
Attributable to shareholders' equity of the parent company
Item Less: Other Non-controlling
Capital Specific Surplus Retained Total
Share capital treasury comprehensive interests
reserve reserve reserve earnings
shares income
I.Balance at the end of last year 1011660000.00 978244910.11 - 20831004.13 - 191222838.94 1464915816.81 -141891335.84 3524983234.15
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 - 20831004.13 - 191222838.94 1464915816.81 -141891335.84 3524983234.15
III.Changes in equity during the year( "- "for
---7332046.00-27501434.7395804437.501466102.78132104021.01
decrease)
(I)Total comprehensive income - - - 7332046.00 - - 290229772.23 1466102.78 299027921.01
(II)Shareholders' contributions and decrease of
---------
capital
1.Contribution by ordinary shareholders - - - - - - - - -
2. Equity settled share-based payments - - - - - - - - -
3. Others - - - - - - - - -
(III) Appropriation of profits - - - - - 27501434.73 -194425334.73 - -166923900.00
1. Appropriation for surplus reserves - - - - - 27501434.73 -27501434.73 - -
2. Distributions to shareholders - - - - - - -166923900.00 - -166923900.00
3. Others - - - - - - - - -
(IV) Transfer within equity - - - - - - - - -
1.Share capital increased by capital reserves - - - - - - - - -
104ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Consolidated Statement of Changes in Shareholders' Equity
For the year ended 31 December 2021
Prepared by：Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd Expressed in CNY
Year ended 31/12/2020
Attributable to shareholders' equity of the parent company
Item Less: Other Non-controlling
Capital Specific Surplus Retained Total
Share capital treasury comprehensive interests
reserve reserve reserve earnings
shares income
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 978244910.11 - 28163050.13 - 218724273.67 1560720254.31 -140425233.06 3657087255.16
Legal reprensentative: The person in charge of accounting affairs: The head of the accounting department:
105ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Statement of Changes in Shareholders' Equity
For the year ended 31 December 2021
Prepared by：Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd Expressed in CNY
Year ended 31/12/2021
Less: Other
Item Specific Retained
Share capital Capital reserve treasury comprehensive Surplus reserve Total
reserve earnings
shares income
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
---242802.45-22420581.26113770811.33136434195.04
decrease)
(I)Total comprehensive income - - - 242802.45 - - 224205812.59 224448615.04
(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
106ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Statement of Changes in Shareholders' Equity
For the year ended 31 December 2021
Prepared by：Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd Expressed in CNY
Year ended 31/12/2021
Less: Other
Item Specific Retained
Share capital Capital reserve treasury comprehensive Surplus reserve Total
reserve earnings
shares income
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:
Statement of Changes in Shareholders' Equity
For the year ended 31 December 2021
Prepared by：Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd Expressed in CNY
Year ended 31/12/2020
Item
Share capital Capital reserve Less: Other Specific Surplus reserve Retained earnings Total
107ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
treasury comprehensive reserve
shares income
I.Balance at the end of last year 1011660000.00 964711931.13 - 922125.77 - 168093225.53 1280197219.9600 3425584502.39
Add：Changes in accounting policies - - - - - - - -
Correction of prior period errors - - - - - - - -
Others - - - - - - - -
II.Balance at the beginning of the year 1011660000.00 964711931.13 - 922125.77 - 168093225.53 1280197219.9600 3425584502.39
III.Changes in equity during the year( "- "for
---209025.97-27501434.7380589012.5700108299473.27
decrease)
(I)Total comprehensive income - - - 209025.97 - - 275014347.3000 275223373.27
(II)Shareholders' contributions and decrease of
--------
capital
1.Contribution by ordinary shareholders - - - - - - - -
2. Equity settled share-based payments - - - - - - - -
3. Others - - - - - - - -
(III) Appropriation of profits - - - - - 27501434.73 -194425334.7300 -166923900.00
1. Appropriation for surplus reserves - - - - - 27501434.73 -27501434.7300 -
2. Distributions to shareholders - - - - - - -166923900.0000 -166923900.00
3. Others - - - - - - - -
(IV) Transfer within equity - - - - - - - -
1.Share capital increased by capital reserves
--------
transfer
2.Share capital increased by surplus reserves
--------
transfer
3.Transfer of surplus reserve to offset losses - - - - - - - -
4.Others - - - - - - - -
(V)Specific Reserve - - - - - - - -
1. Appropriation during the year - - - - - - - -
108ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Statement of Changes in Shareholders' Equity
For the year ended 31 December 2021
Prepared by：Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd Expressed in CNY
Year ended 31/12/2020
Less: Other
Item Specific
Share capital Capital reserve treasury comprehensive Surplus reserve Retained earnings Total
reserve
shares income
2.Utilisation during the year - - - - - - - -
(VI)Others - - - - - - - -
IV.Balance at the end of the year 1011660000.00 964711931.13 - 1131151.74 - 195594660.26 1360786232.5300 3533883975.66
Legal reprensentative: The person in charge of accou nting affairs: The head of th e accounting department:
109ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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 “theCompany”) was established in July 1993 as approved by the Shenzhen Municipal Government with
document SFBF (1993) 724. The Company issued A shares on 15 September 1993 and issued B
shares on 10 January 1994. On 31 August 1994 the issued B shares were listed in the New York
Exchange market as class A recommendation. The total share capital is 1011660000 shares including
891660000 of A shares and 120000000 of B shares. The company business license registration
number is 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 Shenzheninvestment 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 578595.836 shares of the Company (57.19% 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 71th Board meeting dated on 17 March 2022.
2. Scope of consolidated financial statementsFor details about the scope of consolidated statements please refer to Note VII “Interests in otherentities”.
110ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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
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 2021 and the Group’s and the Company’s operating results and cash flows for the year
ended 31 December 2021.
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 Real 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
111ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
（1）Business combinations involving enterprises under common control
For a business combination involving enterprises under common control the assets acquired and
liabilities assumed are measured based on their carrying amounts in the consolidated financial
statements of the ultimate controlling party at the combination date except for adjustments due to
different accounting policies. The difference between the carrying amount of the net assets acquired
and the consideration paid for the combination 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.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 liabilities 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 liabilities incurred or assumed and equity
securities issued by the acquirer in exchange for control of the acquiree. At the acquisition date the
acquired assets liabilities and contingent liabilities of the acquiree are measured at their fair value. The
acquiree’s identifiable asset liabilities and contingent liabilities are recognised at their acquisition-date
fair value.Where the combination cost exceeds the acquirer’s interest in the fair value of the acquiree’s identifiable
net assets the difference is recognised as goodwill and subsequently measured on the basis of its cost
less accumulated impairment provisions. Where the combination cost is less than the acquirer’s interest
in the fair value of the acquiree’s identifiable net assets the difference is recognised in profit or loss for
the current period after reassessment.
112ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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
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
113ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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 reporting period through a business
combination involving enterprises under common control the financial statements of the subsidiary or
business are included in the consolidated financial statements as if the combination had occurred at the
date that the ultimate controlling party first obtained control.Where a subsidiary or business was acquired during the reporting period through a business
combination involving enterprises not under common control the identifiable assets and liabilities of the
acquired subsidiaries or business are included in the scope of consolidation from the date that control
commences.The portion of a subsidiary’s equity that is not attributable to the parent is treated as non-controlling
interests and presented separately in the consolidated balance sheet within shareholders’ equity. The
portion of net profit or loss of subsidiaries for the period attributable to non-controlling interests is
presented separately in the consolidated income statement below the “net profit” line item. When the
amount of loss for the current period attributable to the non-controlling shareholders of a subsidiary
exceeds the non-controlling shareholders’ share of the opening owners’ equity of the subsidiary the
excess is still allocated against the non-controlling interests.
（3）Changes in non-controlling interests
Where the 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
114ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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
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
115ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
items that are measured at fair value in foreign currencies are translated using the exchange rate at the
date the fair value is determined. The resulting exchange differences are recognised in profit or loss.
（2）Translation of foreign currency financial statements
When translating the foreign currency financial statements of overseas subsidiaries assets and
liabilities of foreign operation are translated to Renminbi at the spot exchange rate at the balance sheet
date. Equity items excluding “retained earnings” are translated to Renminbi at the spot exchange rates
at the transaction dates.Income and expenses of foreign operation are translated to Renminbi at the spot exchange rates at the
transaction dates.Cash flow statement of foreign operation is translated to Renminbi at the spot exchange rates 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.
（1）Recognition and derecognition of financial instruments
A financial asset or a financial 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 qualifies 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.
116ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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:
* 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
117ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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 recognition 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 recognition 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 specified 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
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 reclassified 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 recognition. 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
initial 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.
118ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
（3）Classification and measurement of financial liabilities
At the time of initial recognition the financial liabilities of the Group are classified 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 liabilities and
financial liabilities designated at the time of initial recognition as measured at fair value through profit
or loss. For such financial 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 liabilities 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.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
119ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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.he 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
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 recognition 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.
120ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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 initial 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
* Contract Portfolio 1: Product Sales
* Contract Portfolio 2: Works Construction
121ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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 characteristics
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 initial 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 significantly 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;
122ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
* 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 financial 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 characteristics 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
123ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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
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 assets
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 substantially 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
124ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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.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 classified 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）Mesurement method of cost of inventories
125ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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 realisable value and method for provision for obsolete inventories
Net realisable value is the estimated selling price in the ordinary course of business less the estimated
costs of completion and the estimated costs necessary to make the sale and relevant taxes. The net
realisable value is measured based on the verified evidences and considerations for the purpose of
holding inventories and the effect of post balance sheet events.Any excess of the cost over the net realisable value of of inventories is recognised as a provision for
obsolete inventories and is recognised in profit or loss. The Group usually recognises provision for
decline in value of inventories by a single inventory item. If the factors caused the value of inventory
previously written-down have disappeared the provision for decline in value of inventories previously
made is reversed.
（4）Inventory count system
The Group maintains a perpetual inventory system
（5）Amortization methods of low-value consumables and packaging materials
Low-value consumables are charged to profit or loss when they are used.
13. Assets held for sale and discontinued operations
(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
126ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
transaction. In certain circumstances disposal groups include goodwill acquired in a business
combination.A non-current asset or disposal group is classified 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 condition; 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 liabilities 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 initially 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
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 classified 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 and
* its recoverable amount.
(2) Discontinued operations
127ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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.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 classified 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.
14. 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 initial 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.
128ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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
initial 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
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 significant influence
over an investee the remaining equity investment shall be accounted for using Accounting Standard for
129ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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.Significant influence is the power to participate in the financial and operating policy decisions of an
investee but does not have control or joint control over those policies. When determining whether the
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.
130ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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:
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
131ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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;
132ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
* the activities that are necessary to prepare the asset for its intended use or sale have commenced.
（2）Capitalisation period
The capitalisation of borrowing costs ceases when the asset under acquisition or construction becomes
ready for its intended use the borrowing costs incurred thereafter are recognised in profit or loss for the
current period.Capitalisation of borrowing costs is suspended during periods in which the acquisition or construction of
a fixed asset is interrupted abnormally and the interruption lasts for more than 3 months until the
acquisition or construction is resumed.
（3）Capitalisation rate of borrowing costs and calculation basis of capitalised amount
For interest expense actually incurred on specific borrowings the eligible capitalised amount is the net
amount of the borrowing costs after deducting any investment income earned before some or all of the
funds are used for expenditures on the qualifying asset. To the extent that the 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
（1）Valuation Useful life and Impairment
Intangible assets include software land use right and patent rights etc.Intangible assets are stated at actual cost upon acquisition and the useful economic lives are
determined at the point of acquisition. When the useful life is finite amortisation method shall reflect the
pattern in which the asset’s economic benefits are expected to be realised. If the pattern cannot be
determined reliably the straight-line method shall be used. An intangible asset with an indefinite useful
life shall not be amortised.The 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.
133ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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:
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.
134ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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-termemployee benefits payable” on the balance sheet.
(2) Short-term employee benefits
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. If these liabilities are not expected to be fully paid 12 months after the end of the
reporting period in which employee renders the service to the Group and if the financial impact is
significant these liabilities shall be discounted using the net present value method.
（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
135ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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.
（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 satisfied 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
136ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
A provision is recognised for an obligation related to a contingency if all the following conditions 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
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.
137ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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.
(4) 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
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
138ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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
liabilities 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.
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 acquisition of contracts other than the incremental costs expected to be recovered are recorded
into the profit and loss of the current period when incurred.
139ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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 acquisition 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
initial 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.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.
140ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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);
(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.
141ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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
142ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
terminate the lease if the lease term reflects that the lessee will exercise the option to terminate the
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 liabilities 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
100000.00 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.
(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 -
143ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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
In addition to the simplified method for contract changes directly caused by COVID-19 epidemic 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.In addition to the simplified method of contract changes directly caused by COVID-19 epidemic 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.
(4) Rental concession caused by COVID-19 epidemic
For rent concessions such as rent remission or deferred payment reached between the Group and the
lessee or lessor on existing lease contracts directly caused by the COVID-19 epidemic and meeting the
following conditions the Group adopts a simplified method for [houses and buildings] and other
categories of leases:
(1) The lease consideration after the concession is reduced or basically unchanged compared with that
before the concession in which the lease consideration is not discounted or discounted at the discount
rate before the concession;
* The concession is only for the lease payment payable before June 30 2021;
144ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
* There are no significant changes in other terms and conditions of the lease after comprehensive
consideration of qualitative and quantitative factors.The Group does not evaluate whether a lease change has occurred.When the Group is the lessee the Group will continue to calculate the interest expense of the lease
liability at the same discount rate as before the concession and record it into the current profit and loss
and continue to carry out depreciation and other subsequent measurements on the Right-of-use assets
in the same way as before the concession. In case of rent remission the Group will take the remitted
rent as the variable lease payment amount. When the original rent payment obligation is terminated by
reaching a concession agreement the Group will deduct the relevant asset cost or expense by the
amount discounted at the undiscounted or pre-concession discount rate and adjust the lease liability
accordingly. In case of deferred rent payment the Group shall write off the lease liabilities confirmed
earlier when actually paying the rent.For short-term leases with simplified treatment and leases of
low-value assets the Group continues to record the rental under the original contract as the cost or
expense of the relevant assets in the same manner as before the concession. In case of rent remission
or reduction the Group shall treat the remission or reduction of rent as variable lease payment and write
off the cost or expense of relevant assets during the remission or reduction period. If the rent is delayed
in payment the Group shall recognize the rent payable during the original payment period as the
payable amount and deduct the payable amount confirmed earlier when the actual payment is made.When the Group acts as the lessor for the operating lease the Group continues to recognize the
original contract rent as lease income in the same way as before the concession. In case of rent
remission or reduction the Group shall treat the remission or reduction as variable lease payment and
deduct the lease income during the remission or reduction period. If the rent collection is delayed the
Group will recognize the rent collected as receivable during the original collection period and deduct the
receivable confirmed in the earlier period when the rent is actually received. For finance leases the
Group continues to calculate interest and recognize it as lease income at the same discount rate as
before the concession. In case of rent reduction or reduction the Group will take the rent reduced or
reduced as the variable lease payment amount. When the right to charge the original rent is waived by
reaching a concession agreement the Group will deduct the original confirmed lease income by the
amount of discount before the concession or at the discount rate before the concession and record the
insufficient write-off into investment income and adjust the receivable finance lease funds accordingly.In case of delayed payment of rent the Group shall write off the finance lease receivable confirmed in
the earlier period when it actually receives the rent.
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
145ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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:
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.
146ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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 performance 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
147ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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
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
* New leasing standard
The Ministry of Finance issued the Accounting Standards for Business Enterprises No. 21 - Leasing
(revised) in 2018 which requires companies listed both domestically and abroad and those listed
overseas to prepare their financial statements using IFRS or Accounting Standards for Business
Enterprises effective from January 1 2019. Other entities can adopt it from January 1 2021. The Group
decided to implement the new leasing standard from January 1 2021 and the relevant contents of
accounting policies were adjusted. Please refer to Note III.28 and 29 for the accounting policy after the
change.For the existing contracts prior to the first implementation date the Group chooses not to re-evaluate
whether they are leases or include leases on the first execution date.The definition of lease in the new leasing standard does not have a significant impact on the scope of
lease contracts.As lessee
The new leasing standard requires lessees to recognize right-of-use assets and lease liabilities for all
leases with the exception of simplified short-term leases and leases of low-value assets and to
recognize depreciation and interest expenses respectively.The new leasing standard allows lessees to choose one of the following methods of connection
accounting:
* In accordance with the provisions of the Accounting Standards for Business Enterprises No. 28 -
Changes in Accounting Policies Accounting Estimates and Errors Correction retrospective
adjustment method is adopted.* According to the cumulative impact of the first implementation of the standard the amount of
retained earnings and other relevant items in the financial statements at the beginning of the year
of the first implementation of this standard will be adjusted without adjusting the information for
comparable periods.As lessor
148ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
According to the new lease criterion the group without on the cohesion as the lessor's lease in
accordance with the provisions of adjustment but the need to implement new leasing criterion for the
first time since carried out in accordance with the new lease standard accounting treatment.
(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%.
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.
149ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
V. Notes to the consolidated financial statements
1. Cash at bank and Cash Equivalent
Item 2021.12.31 2020.12.31
Cash in hand 12082.00 61121.83
Deposits with banks 316834778.45 1026042804.99
Other monetary funds 247511964.18 1661361143.19
Total 564358824.63 2687465070.01
Including: Total overseas deposits 5970125.18 6699719.34
At the end of year 2021 there were CNY9174439.78 of restricted funds in the bank deposits of which
CNY3500000.00 were the funds frozen by the lawsuit and CNY5674439.78 were the funds for the
construction of public facilities in and around the city of Longgang district.At the end of year 2021 the balance of other monetary funds is seven-day notice deposit including
principal of CNY 240100000.00 and interest of CNY 7411964.18.
2. Trading financial assets
Item 2021.12.31 2020.12.31
Financial Fund 514024710.91 --
3. Notes receivable
2021.12.312020.12.31
Types of
Book Bad debt Book Bad debt
notes Book value Book value
balance provision balance provision
Banker
acceptance -- -- -- -- -- --
notes
Commercial
acceptance 6394766.22 2864228.85 3530537.37 37303205.62 1865160.28 35438045.34
notes
Total 6394766.22 2864228.85 3530537.37 37303205.62 1865160.28 35438045.34
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
Commercial acceptance notes -- 754600.00
150ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
(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 7163029.79
(4) Classified by bad debt provision method
2021.12.31
Book balance Bad debt provision
Types Expected
Percentage Book balance
Amount Amount credit 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 acceptance
1768419.7827.6588420.995.001679998.79
notes
Total 6394766.22 100.00 2864228.85 44.79 3530537.37
2020.12.31
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
----------
a combination basis
Including:
Banker acceptance notes -- -- -- -- --
Commercial acceptance
37303205.62100.001865160.285.0035438045.34
notes
Total 37303205.62 100.00 1865160.28 5.00 35438045.34
Note:
Bad debt provision made on an individual basis:
2021.12.31
Item Bad debt Expected credit
Book balance Reason
provision loss rate (%)
Shenzhen Hongteng Investment Low recoverability
4626346.442775807.8660.00
Management Co. Ltd. is expected
Bad debt provision made on a combination basis:
151ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Combined withdrawal item: commercial acceptance notes
2021.12.312020.12.31
Item Expected Expected Notes Bad debt Notes Bad debt
credit loss credit loss
receivable provision receivable provision
rate (%) rate (%)
Within one
1768419.7888420.995.0037303205.621865160.285.00
year
(5) Additions recoveries or reversals of provision for the current period
Bad debt provision
2020.12.311865160.28
Additions 999068.57
Recoveries or reversals --
Written-off --
2021.12.312864228.85
4. Accounts receivable
（1）Disclosure by Aging
Aging 2021.12.31 2020.12.31
Within 1 year 67970511.50 61614768.47
1 to 2 year 290567.01 --
2 to 3 years -- 66518.00
More than 3 years 23975620.75 24688143.06
Subtotal 92236699.26 86369429.53
Less: Bad Debt Provision 31187914.15 26778485.47
Total 61048785.11 59590944.06
（2）Classified by bad debt provision method
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: -- -- -- -- --
152ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
2021.12.31
Types Book balance Bad debt provision
Percentage Expected credit Book value
Amount Amount
(%) loss rate (%)
Receivable from property
1064220.181.1553211.015.001011009.17
sales
Receivable from other
58622042.1563.561922299.773.2856699742.38
corporate customers
Total 92236699.26 100.00 31187914.15 33.81 61048785.11
Continued:
2020.12.31
Book balance Bad debt provision
Types Expected
Percentage Book value
Amount Amount credit loss
(%)
rate (%)
Bad debt provisions made on
24688143.0628.5824688143.06100.00--
an individual basis
Bad debt provisions made on
61681286.4771.422090342.413.3959590944.06
a combination basis
Including: -- -- -- -- --
Receivable from property
11114285.6012.87555714.285.0010558571.32
sales s
Receivable from other
50567000.8758.551534628.133.0349032372.74
corporate customers s
Total 86369429.53 100.00 26778485.47 31.00 59590944.06
Bad debt provision made on an individual basis:
2021.12.31
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
9649415.209649415.20100.00
sale uncollectible
Shenzhen Hongteng Investment recoverability is
8345083.915007050.3560.00
Management Co. Ltd. relatively small
Receivable from revoked Could be
2328158.402328158.40100.00
subsidiaries uncollectible
Could be
Receivable from other customers 653223.42 653223.42 100.00
uncollectible
Total 32550436.93 29212403.37 89.75
Continued:
Item 2020.12.31
153ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Expected credit
Book balance Bad debt provision Reason
loss rate (%)
Agent for import and export Could be
11574556.0011574556.00100.00
business payment uncollectible
Long-term receivable of Could be
10132205.2410132205.24100.00
property sale uncollectible
Shenzhen Hongteng Investment Could be
2328158.402328158.40100.00
Management Co. Ltd. uncollectible
Receivable from revoked Could be
653223.42653223.42100.00
subsidiaries uncollectible
Total 24688143.06 24688143.06 100.00
Bad debt provision made on a combination basis:
Combined withdrawal item: property sales receivable
2021.12.312020.12.31
Expected Accounts Bad debt Expected credit Accounts Bad debt
credit loss
receivable provision loss rate (%) receivable provision
rate (%)
Within 1
1064220.1853211.015.0011114285.60555714.285.00
year
1 to 2 years -- -- -- -- -- --
Total 1064220.18 53211.01 5.00 11114285.60 555714.28 5.00
Bad debt provision made on a combination basis:
Combined withdrawal item: other customers receivables
2021.12.312020.12.31
Expected Expected Accounts Bad debt Accounts Bad debt
credit loss credit loss
receivable provision receivable provision
rate (%) rate (%)
Within 1
58622042.151922299.773.2850500482.871531302.233.03
year
1 to 2 years -- -- -- 66518.00 3325.90 5.00
Total 58622042.15 1922299.77 3.28 50567000.87 1534628.13 3.03
(3) Additions recoveries or reversals of provision for the current period
Bad debt provision
2020.12.3126778485.47
Additions 4433371.85
Recoveries or reversals --
154ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Bad debt provision
Written-off --
Adjustment to asset held for sale 23943.17
2021.12.3131187914.15
(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 249 Poly Real Estate
19355805.1120.98580674.15
Development Co. Ltd.Wuhan Yutian Xingye Land Co. LTD 12736852.59 13.81 382105.58
Shenzhen Hongteng Investment
8345083.919.055007050.35
Management Co. Ltd.Wuhan Linyun Real Estate
8314761.629.01249442.85
Development Co. Ltd.Wuhan Liantou Vanke Real Estate Co.
3698300.504.01110949.02
Ltd.Total 52450803.73 56.86 6330221.95
At the end of the period due to the factoring of accounts receivable the factoring amount is CNY
50440116.24. At the same time the book value of accounts receivable is CNY 50440116.24 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:
2021.12.312020.12.31
Aging
Amount % Amount %
Within 1 year 4698254.37 95.90 3004771.47 93.74
1 to 2 years 206.95 0.00 213.04 0.01
2 to 3 years -- -- 200000.00 6.23
More than 3 years 200550.00 4.09 550.00 0.02
Total 4899011.32 100.00 3205534.51 100.00
(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
4279208.74 which accounts for 87.35 % of the total ending balance of prepayments.
6. Other receivables
Item 2021.12.31 2020.12.31
Interest receivable -- --
Dividends receivable 1052192.76 1052192.76
155ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Item 2021.12.31 2020.12.31
Other receivables 29561815.32 31692851.08
Total 30614008.08 32745043.84
(1) Dividends receivable
Items 2021.12.31 2020.12.31
Yunnan Kunpeng Air Service Co. LTD 1052192.76 1052192.76
Less: Bad Debt Provision -- --
Total 1052192.76 1052192.76
Significant dividends receivable overdue more than one year are as follows:
Whether impairment
The ending Reasons for not
Items aging occurs and the basis
balance retrieving
for judgment
Yunnan Kunpeng Air Service Co.
1052192.76 5 years Delay to issue No
LTD
(2) Other receivable
* Disclosure by aging
Aging 2021.12.31 2020.12.31
Within 1 year 29436729.02 29101943.94
1 to 2 years 905350.96 724840.46
2 to 3 years 106096.34 266855.66
More than 3 years 188306797.86 196836127.29
Subtotal 218754974.18 226929767.35
Less: Bad Debt Provision 189193158.86 195236916.27
Total 29561815.32 31692851.08
* Disclosure by nature
2021.12.312020.12.31
Item Bad debt Bad debt
Book balance Book value Book balance Book value
provision provision
Other receivables
------553009.68--553009.68
from government
Other receivables
from employee’s petty 580911.83 -- 580911.83 364674.25 -- 364674.25
cash
Other receivables
from the collecting 627681.27 -- 627681.27 665251.08 -- 665251.08
and paying on behalf
156ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Other receivables
48840482.9120487260.6928353222.2263398344.5833288428.5130109916.07
from other customers
Other receivables
168705898.17168705898.17--161948487.76161948487.76--
from related parties
Total 218754974.18 189193158.86 29561815.32 226929767.35 195236916.27 31692851.08
* Bad Debt Provision
At the end of the period bad debt provision at the first stage:
Expected credit
Bad debt
Types Book balance loss rate over the Book value Reason
provision
next 12 months (%)
Other receivables from
580911.83----580911.83
employee’s petty cash
Other receivables from
the collecting and 627681.27 -- -- 627681.27
paying on behalf
Other receivables from
29844939.165.001491716.9428353222.22
other customers
Total 31053532.26 4.80 1491716.94 29561815.32
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
Bad debt Book
Types Book balance loss rate over the Reason
provision value
entire duration (%)
Bad debt provisions shall
be made on an individual -- -- -- --
basis
Other receivable from Could be
3838281.67100.003838281.67--
other revoked subsidiary uncollectible
Other receivable from Could be
183863160.25100.00183863160.25--
other surviving subsidiary uncollectible
Including :Other
Could be
receivables from related 168705898.17 100.00 168705898.17 --
uncollectible
parties
Total 187701441.92 100.00 187701441.92
Bad Debt Provision as at December 31 2020:
As at December 31 2020 bad debt provision at the first stage:
157ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Expected credit
loss rate over Bad debt
Types Book balance Book value Reason
the next 12 provision
months (%)
Bad debt provisions is
drawn on a combination
basis
Other receivables from
553009.68----553009.68
government
Other receivables from
364674.25----364674.25
employee’s petty cash
Other receivables from
the collecting and paying 665251.08 -- -- 665251.08
on behalf
Other receivables from
31694648.485.001584732.4130109916.07
other customers
Other receivables from
--------
related parties
Total 33277583.49 4.76 1584732.41 31692851.08
As of December 31 2020 the Company does not have interest receivable dividends receivable and
other receivables at the second stage.As of December 31 2020 bad debt provisions at the third stage:
Expected credit
Bad debt Book
Types Book balance loss rate over the Reason
provision value
next 12 months (%)
Bad debt provisions shall
be made on an individual
basis
Other receivable from Could be
3275882.44100.003275882.44--
other revoked subsidiary uncollectible
Other receivable from Could be
190376301.42100.00190376301.42--
other surviving subsidiary uncollectible
Including :Other
Could be
receivables from related 161948487.76 100.00 161948487.76 --
uncollectible
parties
Total 193652183.86 100.00 193652183.86 --
* Bad debt provisions in the current period
Bad debt provision The first stage The second stage The third stage Total
158ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Expected credit Expected credit
Expected
losses over the loss over the entire
credit losses
entire duration (no duration (credit
over the next
credit impairment impairment has
12 months
occurred) occurred)
Balance as at December 31 2020 1584732.41 -- 193652183.86 195236916.27
The balance as at December 31
--------
2020 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 65525.13 -- 2297254.16 2362779.29
Return the current -- -- -- --
The current reseller -- -- -- --
This verification -- -- -- --
Other changes -158540.60 -- -8247996.10 -8406536.70
Balance as of December 31 2021 1491716.94 -- 187701441.92 189193158.86
Note：Other changes were mainly due to the transfer of bad debts of Shenzhen Property Management
Co. Ltd. to assets for sale at CNY 8213958.86 and the impact of foreign exchange gains and losses
on bad debt provisions of CNY 192577.84.* 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
89035748.0740.7089035748.07
(Vancouver) Co. Ltd from related 5 years
parties
Other
receivables More than
Paklid Limited 18870785.54 8.63 18870785.54
from related 5 years
parties
Other
Australia Bekaton
receivables More than
property 12559290.58 5.74 12559290.58
from related 5 years
Limited
parties
Other
Guangdong province receivables More than
Huizhou Luofu Hill 10465168.81 4.78 10465168.81
Mineral Water Co.Ltd from related 5 years
parties
159ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Other
Xi’an Fresh Peak receivables More than
Property Trading Co. 8419205.19 3.85 8419205.19
Ltd from related 5 years
parties
Total -- 139350198.19 -- 63.70 139350198.19
7. Inventories
(1) Inventory classification
2021.12.312020.12.31
Provision for Provision for
price price
Item decline/provision decline/provision
Book balance for impairment of The book value Book balance for impairment of The book value
contract contract
performance performance
cost cost
Real estate development：
Development
3037991969.96--3037991969.96556589091.25--556589091.25
cost
Product
994212857.29--994212857.29659403711.71268941.60659134770.11
development
Subtotals 4032204827.25 -- 4032204827.25 1215992802.96 268941.60 1215723861.36
Non-real estate development items:
Raw
8458.34--8458.34873107.59240000.00633107.59
materials
Inventory
334040.0438891.91295148.13631926.3038891.91593034.39
goods
Constructions 2425128.90 -- 2425128.90 3514109.22 -- 3514109.22
Subtotals 2767627.28 38891.91 2728735.37 5019143.11 278891.91 4740251.20
Total 4034972454.53 38891.91 4034933562.62 1221011946.07 547833.51 1220464112.56
(2) Provision for inventories
Increase in current The reduced
Item 2021.01.01 To turn back or 2021.12.31
provision Others other
resell
Real estate development：
Product
268941.60----268941.60----
development
Non-real estate development items:
Raw materials 240000.00 -- -- -- 240000.00 --
Inventory goods 38891.91 -- -- -- -- 38891.91
Total 547833.51 -- -- 268941.60 240000.00 38891.91
Provision for Decline in Inventory (continued)
160ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Current roll-back or roll-off
Specific basis for determining net realizable/residual
Item Reasons for inventory
consideration and costs to be incurred
depreciation provision
The amount of estimated selling price minus the
Development cost estimated costs to be incurred at completion estimated --
selling expenses and related taxes
The amount of estimated selling price minus estimated
Product development --
selling expenses and related taxes
The amount of estimated selling price minus the
Raw materials estimated costs to be incurred at completion estimated --
selling expenses and related taxes
The amount of estimated selling price minus estimated
Inventory goods --
selling expenses and related taxes
The amount of estimated selling price minus the
Construction estimated costs to be 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 2021 the Group's inventory balance contains capitalized borrowing costs at CNY
12237466.31 (The amount is CNY 3497172.46 as at 31st December 2020).
(4)Development cost
Estimated Expected
Starting Ending
Project name completion total 2021.12.31 2020.12.31
time provision
time investment
ShanTou Fresh
------28291908.1125291908.11--
Peak Building
Tianyue Bay No.2 In 2018 In 2021 65485.00 531297183.14 --
Lin Xin Garden In 2021 In 2023 300000.00 2015750061.85 -- --
Shenfang
In 2022 In 2024 152060.00 993950000.00 -- --
GuangmingLi
Total 65485.00 3037991969.96 556589091.25 --
(5) Product development
Time for Increase in End of
The item name 2021.01.01 The reduced 2021.12.31
completion current the fall
Jinye Island
199739127219.14367543.46--39494762.60--
Multi-tier villa
Jinye Island villa
20105387376.71308630.54--5696007.25--
No.10
Jinye Island villa
20082333281.42----2333281.42--
No.11
YueJing dongfang
20147727546.84--421927.477305619.37--
Project
161ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Time for Increase in End of
The item name 2021.01.01 The reduced 2021.12.31
completion current the fall
Wenjin Garden -- 23198.37 -- 23198.37 -- --
HuangPu XinCun -- 140000.00 -- -- 140000.00 --
Shenfang
201410206656.46--10206656.46----
Shanglin Garden
Beijing Fresh Peak
-304557.05----304557.05--
Buliding
TianYue Bay No.1 2017 335020709.01 -- 64478654.34 270542054.67 --
Shengfang CuiLin
201855783765.782885290.38--58669056.16--
Building
Chuanqi Donghu 2019 203349400.93 -- 161515343.69 41834057.24 --
TianYue Bay No.2 2021 -- 617484635.86 49591174.33 567893461.53
Total 659403711.71 621046100.24 286236954.66 994212857.29 --
8. Assets and liabilities held for sale
2021.12.312020.12.31
Item Provision Carrying Book Provision for Carrying
Book value for
amount value impairment amount
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 2021.12.31 2020.12.31
Liabilities held for sale: -- --
Liabilities included in disposal groups held for sale -- --
Including：
65752452.06--
Shenzhen Property Management Co. Ltd.Total 65752452.06 --
In order to optimize and adjust the industrial structure on 30 December 2021 the Company and its
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 Management Co. Ltd. with a transfer
price of CNY 196.6767 million
Disposal groups held for sale
162ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Shenzhen Property Management Co. Ltd.Carrying
Fair value as at
Item amount as at Costs to sell Timetable
2021.12.31
2021.12.31
Assets included in disposal
--------
groups held for sale
Cash and bank 64521214.48 64521214.48 -- 2022 年
Accounts receivable 454920.23 454920.23 -- 2022 年
Other accounts receivable 4239993.91 4239993.91 -- 2022 年
Inventory 834370.65 834370.65 -- 2022 年
Other current asset 4832730.35 4832730.35 -- 2022 年
Investment Property 1434434.11 1434434.11 -- 2022 年
Fixed asset 2516947.44 2516947.44 -- 2022 年
Deferred tax asset 105620.93 105620.93 -- 2022 年
Liabilities included in disposal
--------
groups held for sale
Wage payable 17949449.66 17949449.66 -- 2022 年
Tax payable 1906577.65 1906577.65 -- 2022 年
Other accounts payable 38059508.29 38059508.29 -- 2022 年
Long-term payable 7836916.46 7836916.46 -- 2022 年
9. Other current assets
Item 2021.12.31 2020.12.31
Income tax overpaid or prepaid 3205104.33 68880760.27
VAT prepaid 7643969.22 25577294.63
Input tax to be deducted 53061826.30 4741378.98
Land appreciation tax 2481541.71 2083793.61
Business Tax 259308.30 312287.17
Other 1565137.18 1311620.13
Total 68216887.04 102907134.79
163ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
10. Long-term equity investments
Movements during the year
Investment Declared Balance of
income Other distribution provision for
Investee 2020.12.31 Increase Other Decrease in recognised Provision for 2021.12.31
in comprehensive equity of cash Other impairment as at
capital under impairment
capital income 2021.12.31
equity movements dividends or
method profits
* Joint
ventures
Guangdong
province
Huizhou Luofu 9969206.09 -- -- -- -- -- -- -- -- 9969206.09 9969206.09
Hill Mineral
Water Co. Ltd
Fengkai Xinhua
9455465.38----------------9455465.389455465.38
Hotel
Subtotal 19424671.47 -- -- -- -- -- -- -- -- 19424671.47 19424671.47
* Associates
Shenzhen
Ronghua JiDian 1454444.29 -- -- -105321.37 -- -- -- -- -- 1349122.92 1076954.64
Co. ltd
Shenzhen
Runhua
1445425.56----------------1445425.561445425.56
Automobile
trading Co. Ltd
Dongyi Real
30376084.89----------------30376084.8930376084.89
Estate Co. Ltd
Subtotal 33275954.74 -- -- -105321.37 -- -- -- -- -- 33170633.37 32898465.09
164ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Movements during the year
Investment Declared Balance of
income
Increase Other Other distribution provision for Investee 2020.12.31 Decrease in recognised Provision for 2021.12.31
in comprehensive equity of cash Other impairment as at
capital under impairment
capital income 2021.12.31
equity movements dividends or
method profits
* Other equity
-
investment
Paklid Limited 201100.00 -- -- -- -- -- -- -- -- 201100.00 201100.00
Australia
Bekaton 906630.00 -- -- -- -- -- -- -- -- 906630.00 906630.00
Property Limited
Shenzhen
Shenfang
10000000.00----------------10000000.0010000000.00
Department
Store Co. Ltd.Shantou Fresh
58547652.25----------------58547652.2558547652.25
Peak Building
Guangdong
Province
kaiFeng Lian
56228381.64----------------56228381.6456228381.64
Feng Cement
Manufacturing
Co. Ltd
Jiangmen
XinJiang real 9037070.89 -- -- -- -- -- -- -- -- 9037070.89 9037070.89
estate compnay
Xian Xinfeng
property trading 32840729.61 -- -- -- -- -- -- -- 32840729.61 32840729.61
ltd.
165ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Movements during the year
Investment Declared Balance of
income
Increase Other Other distribution provision for Investee 2020.12.31 Decrease in recognised Provision for 2021.12.31
in comprehensive equity of cash Other impairment as at
capital under impairment
capital income 2021.12.31
equity movements dividends or
method profits
Subtotal 167761564.39 -- -- -- -- -- -- -- 167761564.39 167761564.39
Total 220462190.60 -- -- -105321.37 -- -- -- -- -- 220356869.23 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.
166ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
11. Investment in other equity instruments
Item 2021.12.31 2020.12.31
Shantou SME Financing Guarantee Co. Ltd. 13831938.92 13508202.32
Yunnan Kun Peng Aviation Service Limited Corporation 22490765.41 24002658.19
Total 36322704.33 37510860.51
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 other
Dividend income The The
comprehensive To
Item recognized during cumulative cumulative
income transferred reason
the current period gains loss
into retained earnings
Shantou SME
Financing Guarantee 692580.00 4736640.00 -- -- --
Co. Ltd.Yunnan Kun Peng
Aviation Service 1653305.67 -- -- --
Limited Corporation
12. Investment Properties
(1) Investment properties measured using the cost model
Land use
Item Buildings Total
rights
Ⅰ.Cost
1.2020.12.311054731893.62100572661.911155304555.53
2.Additions during the year -- -- --
（1）Transfers from inventories -- -- --
（2）Other transfers(exchange rate
------
movement)
（3）Additions due to business combinations -- -- --
3. Decrease during the year 11819871.23 2299719.72 14119590.95
（1）Other transfers 11819871.23 -- 11819871.23
（2）Other decrease (exchange rate
--2299719.722299719.72movement）
4.2021.12.311042912022.3998272942.191141184964.58
Ⅱ.Accumulated depreciation or amortization
1.2020.12.31442265712.97--442265712.97
2.Charge for the year 25653177.83 -- 25653177.83
（1）Depreciated or amortised 25653177.83 -- 25653177.83
167ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Land use
Item Buildings Total
rights
（2）Additions due to business combinations -- -- --
（3）Others(exchange rate movement） -- -- --
3. Reductions during the year 10385437.12 -- 10385437.12
（1）Disposals -- -- --
（2）Other transfers out 10385437.12 -- 10385437.12
（3）Others(exchange rate movement） -- -- --
4.2021.12.31457533453.68--457533453.68
III.Provision for impairment
1.2020.12.3114128544.6282544676.4196673221.03
2.Charge for the year -- -- --
（1）Other additions (exchange rate movement） -- -- --
3. Reductions on disposals -- 1887487.29 1887487.29
（2）Other transfers (exchange rate movement） -- 1887487.29 1887487.29
4.2021.12.3114128544.6280657189.1294785733.74
IV.Carrying amounts
1. Carrying amount as at 2021.12.31 571250024.09 17615753.07 588865777.16
2. Carrying amount as at 2020.12.31 598337636.03 18027985.50 616365621.53
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. The other reduction
in original value of building and other depreciation is due to the reclassification of investment property to
assets held for sale which caused by the intention of selling Shenzhen Property Management Co. Ltd.
13. Fixed assets
Item 2021.12.31 2020.12.31
Fixed assets 23920424.55 28039978.43
* Fixed assets
Electronic
Plant & Machinery &
Item device and Total
buildings equipment
others
I.Cost
1.2020.12.31107700181.4210441558.9213645811.86131787552.20
2.Additions during the year -- 742347.12 1290327.93 2032675.05
（1）Purchases -- 742347.12 960533.10 1702880.22
（2）Other transfers -- -- -- --
（3）Additions due to
----329794.83329794.83
business combinations
168ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Electronic
Plant & Machinery &
Item device and Total
buildings equipment
others
3. Decrease during the year 7582373.32 2876450.63 7662559.96 18121383.91
（1）Disposals or written-offs -- 477402.00 2584295.09 3061697.09
（2）Others 7582373.32 2399048.63 5078264.87 15059686.82
4.2021.12.31100117808.108307455.417273579.83115698843.34
II.Accumulated depreciation: -
1.2020.12.3183519658.699059003.8811168911.20103747573.77
2.Charge for the year 2493103.50 302686.87 646638.80 3442429.17
(1)Provision 2493103.50 302686.87 627083.93 3422874.30
（2）business combination -- -- 19554.87 19554.87
3.Reductions for the year 6821632.35 2497009.59 6092942.21 15411584.15
(1)Disposal or written-offs -- 474852.00 2393992.77 2868844.77
(1) (2)Others 6821632.35 2022157.59 3698949.44 12542739.38
4.2021.12.3179191129.846864681.165722607.7991778418.79
III.Provision for impairment -- -- -- --
IV.Carrying amount
1. As at 2021.12.31 20926678.26 1442774.25 1550972.04 23920424.55
2. As at 2020.12.31 24180522.73 1382555.04 2476900.66 28039978.43
Note: other decrease is due to the reclassification of fixed assets to assets held for sale which caused
by the sale of Shenzhen Property Management Co. Ltd.
14. Right-of-use assets
Item Houses and Buildings
I. Original book value:
2020.12.31--
Add: changes in accounting policy --
1.2021.01.01--
2. Amount increased during the current period 431779.61
Addition due to business combination 431779.61
3. Decrease amount in current period --
4.2021.12.31431779.61
II. Accumulative depreciation
2020.12.31--
Add: changes in accounting policy --
1.2021.01.01--
2. Amount increased during the current period 66427.64
Addition due to business combination 66427.64
169ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Item Houses and Buildings
3. Decrease amount in current period --
4.2021.12.3166427.64
III. Impairment Provisions
2020.12.31--
Add: changes in accounting policy --
1.2021.01.01--
2. Amount increased during the current period --
3. Decrease amount in current period --
4.2021.12.31--
IV. Book value
1. as at 2021.12.31 365351.97
2. as at 2020.01.01 --
15. Intangible assets
(1) Intangible assets
Item Software
I.Cost
1.2020.12.312241800.00
2.Additions during the year --
3.Decrease during the year --
4.2021.12.312241800.00
II.Accumulative amortization
1.2020.12.312241800.00
2.Charge for the year --
3.Reduction for the year --
4.2021.12.312241800.00
III.Provision for impairment --
IV.Carrying amount
1. As at 2021.12.31 --
2. As at 2020.12.31 --
16. Long-term deferred expenses
Decreases during the year 2021.12.31
Additions
Item 2020.12.31
during the year Amortisation Others
for the year decreases
Renovation
61667.531880290.16237990.14--1703967.55
costs
Other -- 463232.73 2237.10 -- 460995.63
170ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Decreases during the year 2021.12.31
Additions
Item 2020.12.31
during the year Amortisation Others
for the year decreases
Total 61667.53 2343522.89 240227.24 -- 2164963.18
17. Deferred tax assets and deferred tax liabilities
(1) Deferred tax assets and deferred tax liabilities that are not offset
2021.12.312020.12.31
Deductible/Taxable Deductible/Taxable
Item Deferred tax Deferred tax
Temporary Temporary
assets/liabilities assets/liabilities
Differences Differences
Deferred tax assets:
Provision for impairment 11676505.43 2919126.36 6549009.33 1637252.34
Pre-tax recoverable
60853662.7215213415.6848676321.0312169080.25
operating losses
Provision for land
537081594.36134270398.59334846723.4183711680.85
appreciation tax
Unrealised profits of
48439321.6812109830.4240305039.2210076259.81
intra-group transactions
Accrued Contractual cost 22029322.92 5507330.73 20603882.91 5150970.73
Subtotal 680080407.11 170020101.78 450980975.90 112745243.98
Deferred tax liabilities:
Unmatured interest 7411964.20 1852991.05 18361143.19 4590285.80
Changes in the fair value of
18858463.594714615.9020046619.775011654.94
other equity investments
Changes in the fair value of
11828130.442957032.61----
trading financial assets
Subtotal 38098558.23 9524639.56 38407762.96 9601940.74
(2) Details of unrecognized deferred tax assets
Item 2021.12.31 2020.12.31
Deductible losses 10875646.42 21878078.42
Bad debt provision 211607688.34 217879386.20
Impairment provision for long-term equity investments 220084700.95 220084700.95
Impairment provision for Investment property 94785733.74 96673221.03
Total 537353769.45 556515386.60
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.
171ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
(3) Expiration of deductible tax losses for unrecognised deferred tax assets
Year 2021.12.31 2020.12.31 Note
2021——11349323.06
20225753184.385753184.38
20234085485.244085485.24
2024688456.49688456.49
20251629.251629.25
2026346891.06——
Total 10875646.42 21878078.42
18. Short-term loans
(1) Classification of short-term loans
Item 2021.12.31 2020.12.31
Pledge loans 50440116.24 76893995.94
Note: The ending balance of loan includes the factoring loan applied by the group for accounts
receivable and discounted commercial acceptance notes receivable which is not derecognized.
19. Notes payable
Item 2021.12.31 2020.12.31
Commercial acceptance notes 247376403.56 --
Banker acceptance notes -- --
Total 247376403.56 --
Note: The notes payable due but unpaid at the year end is CNY 23790000.00.
20. Accounts Payable
Item 2021.12.31 2020.12.31
Construction 139000203.58 174552420.54
Other 2447355.66 2374193.74
Total 141447559.24 176926614.28
21. Advances from customers
Item 2021.12.31 2020.12.31
Payment for goods-import and export 4218370.69 4218370.69
Others 2193056.35 1721721.46
172ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Item 2021.12.31 2020.12.31
Total 6411427.04 5940092.15
22. Contractual liabilities
Item 2021.12.31 2020.12.31
Advance collection of house sales 199909796.88 196619100.77
Room charges in advance 55693.20 167876.42
Total 199965490.08 196786977.19
23. Employee benefits payable
Accrued during Decreased
Item 2020.12.31 2021.12.31
the year during the year
Short-term employee benefits 60375684.92 178996492.79 195580189.34 43791988.37
Post-employment benefits -
92149.1714546364.7914503790.55134723.41
defined contribution plans
Total 60467834.09 193542857.58 210083979.89 43926711.78
(1) Short-term employee benefits
Accrued during Decreased
Item 2020.12.31 2021.12.31
the year during the year
Salaries bonus allowances 59181979.88 157159991.84 172705010.07 43636961.65
Staff welfare 37800.00 6180350.16 6182350.16 35800.00
Social insurances 1850.44 5397620.93 5399471.37 --
Including：1. Medical insurance 1259.40 4944592.21 4945851.61 --
2. Work-related injury insurance 591.04 76805.95 77396.99 --
3. Maternity insurance -- 376222.77 376222.77 --
Housing Fund 583666.83 6368585.34 6921211.85 31040.32
Labor union fees staff and
570387.773889944.524372145.8988186.40
workers’ education fee
Total 60375684.92 178996492.79 195580189.34 43791988.37
Note: there There is CNY 17949449.66 in decreased during the year and reclassified to liabilities held
for sale.
(2) Defined contribution plans
Accrued during Decreased
Item 2020.12.31 2021.12.31
the year during the year
Post-employment benefits 92149.17 14546364.79 14503790.55 134723.41
Including: 1．Basic pension insurance 75318.93 10345263.18 10348582.11 72000.00
2．Unemployment insurance 914.12 246238.03 247152.15 --
173ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Accrued during Decreased
Item 2020.12.31 2021.12.31
the year during the year
3．Annuity 15916.12 3954863.58 3908056.29 62723.41
Total 92149.17 14546364.79 14503790.55 134723.41
24. Taxes payable
Item 2021.12.31 2020.12.31
Corporate income tax 55260539.21 116073629.88
Land appreciation tax 541127363.69 339492860.89
Value-added tax 2364703.76 2225243.79
Individual income tax 741740.25 1067279.80
City maintenance and construction tax 243387.84 240165.30
Property tax 262015.56 272984.08
Education surcharge 105021.26 180666.76
Local Education surcharge 56806.29 11963.23
Other 379294.62 144853.22
Total 600540872.48 459709646.95
25. Other payables
Item 2021.12.31 2020.12.31
Interest payables 16535277.94 16535277.94
Dividend payables -- --
Other payables 564842137.70 260569851.80
Total 581377415.64 277105129.74
（1）Interest payable
Item 2021.12.31 2020.12.31
Non-financial institution borrowing interest
16535277.9416535277.94
(interest 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 2021.12.31 2020.12.31
Non-related party transactions 161537615.36 --
Accrued land appreciation tax 36447111.94 59789921.48
Related party transactions 215460862.07 18119380.19
174ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Item 2021.12.31 2020.12.31
Deposits 48106373.19 100280051.56
Others 103290175.14 82380498.57
Total 564842137.70 260569851.80
（3）significant other payables aging over 1 year
Item amount Reason for no repayment
Accrued land appreciation tax 36447111.94 Not yet to clear
26. Non-current liabilities due within one year
Item 2021.12.31 2020.12.31
Lease liabilities due within one year 83023.44 --
27. Other current liabilities
Item 2021.12.31 2020.12.31
Other 8196849.13 8917027.07
28. Lease liabilities
Item 2021.12.31 2021.01.01
Buildings 208944.21 --
Subtotal 208944.21 --
Minus: lease liabilities due within one year 83023.44 --
Total 125920.77 --
Note: The interest expense of leasing liabilities accrued in 2021 is CNY 9920.46 which is included in
the financial expense - interest expense.
29. Long-term payables
Item 2021.12.31 2020.12.31
Long-term payables -- 7480233.43
(1) Long-term payables
Item 2021.12.31 2020.12.31
Maintenance fund -- 7480233.43
Note: at the end of the period CNY 7480233.43 in long-term payables is reclassified to liabilities held
for sale.
175ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
30. Capital stock (unit: 10000 shares)
Increase or decrease of current period (+ -)
Item 2020.12.31 Conversion New Stock 2021.12.31
from reserve Others Subtotal
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
176ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
32. Other comprehensive income
2021.12.31
Current amount
（3）=（1）+（2）
2020.12.31 Minus: early entry into After-tax After tax it
Item The current
（1） other comprehensive Minus: income attributable to belongs to
income tax before
income into the current tax expense parent company minority
the amount
period of profit and loss (2) shareholders
Other comprehensive
income that cannot be
15034964.83-1188156.18---297039.04-891117.14--14143847.69
reclassified into profits
and losses
1. Changes in the fair
value of other equity 15034964.83 -1188156.18 -- -297039.04 -891117.14 -- 14143847.69
instrument investments
Other comprehensive
income which is
13128085.308817030.96----8817030.96911435.2321945116.26
reclassified into profit
and loss
1. Difference in
translation of foreign
13128085.308817030.96----8817030.96911435.2321945116.26
currency financial
statements
Total other
comprehensive 28163050.13 7628874.78 - -297039.04 7925913.82 911435.23 36088963.95
income
177ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
178ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
33. Surplus reserve
Additions during Reductions
Item 2020.12.31 2021.12.31
the year during the year
Statutory surplus reserve 218724273.67 22420581.26 -- 241144854.93
Arbitrary surplus reserve -- -- --
Total 218724273.67 22420581.26 -- 241144854.93
34. Retained earnings
Appropriation or
Year ended
Item Year ended 2021.12.31 distribution
2020.12.31
percentage
Retained earnings as at 31/12/2020 (before
1560720254.311464915816.81--
adjustment)
Total adjustments for opening retained
----
earnings（“+” for increase; “–” for decrease）
Retained earnings as at 01/01/2021 (after
1560720254.311464915816.81
adjustment)
Add: Net profits for the year attributable to
220836309.93290229772.23--
shareholders of the Group
Less: Appropriation for statutory surplus
22420581.2627501434.7310%
reserve
Appropriation for ordinary share dividend 88014420.00 166923900.00 --
Retained earnings as at 2021.12.31 1671121562.98 1560720254.31 --
35. Operating revenue and operating costs
(1) Operating revenue and operating costs
Year ended 2021.12.31 Year ended 2020.12.31
Item
Income Cost Income Cost
Main business 1305013711.33 644196683.45 1602794163.58 793896680.56
Other business 15776937.12 22151678.03 12215550.30 11611768.12
Total 1320790648.45 666348361.48 1615009713.88 805508448.68
(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 876161088.60 280828284.77 1158411393.81 387659747.71
Construction 200259571.16 194607475.30 251454463.43 244511214.58
Property Management 162526580.18 145898235.49 151968675.51 139937487.12
Lease 81791161.56 38780101.44 63254584.48 35984852.34
subtotal 1320738401.50 660114097.00 1625089117.23 808093301.75
Less：Internal offset 15724690.17 15917413.55 22294953.65 14196621.19
Total 1305013711.33 644196683.45 1602794163.58 793896680.56
179ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
(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： 1320105876.64 660114097.00 1624250104.98 807403891.75
Guangdong Province 1308786001.07 652104794.06 1613933749.67 799028972.30
Other 11319875.57 8009302.94 10316355.31 8374919.45
Overseas： 632524.86 -- 839012.25 689410.00
America 632524.86 -- 839012.25 689410.00
Subtotal 1320738401.50 660114097.00 1625089117.23 808093301.75
Less：Internal offset 15724690.17 15917413.55 22294953.65 14196621.19
Total 1305013711.33 644196683.45 1602794163.58 793896680.56
(4) Business revenue decomposition information
Current amount Total
Item Property
Real estate Construction Leases Other
Management
Main business
876161088.60192993579.90159487885.2776371157.56--1305013711.33
revenue
Including: Confirm at
876161088.60--------876161088.60
a certain point
Confirm at a certain
--192993579.90159487885.2776371157.56--428852622.73
time
Other business
--------15776937.1215776937.12
income
Total 876161088.60 192993579.90 159487885.27 76371157.56 15776937.12 1320790648.45
36. Taxes and surcharges
Amount of previous
Item Current amount
period
Land appreciation tax 234706353.29 311880157.14
Property tax 9928730.40 7554272.86
Urban maintenance and
4235765.075098758.97
construction tax
education surcharge 1910215.37 2261494.65
Local education surcharge 1081322.37 1372146.74
Embankment protection fees 2497929.35 1795236.14
Total 254360315.85 329962066.50
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 26587685.99 44260043.83
180ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Item Current amount Amount of previous period
Employee benefits 9474880.74 6493766.61
Entertainment expenses 3261755.78 2131882.24
Advertising expenses 2932966.45 2646392.11
Other 480459.26 457312.43
Total 42737748.22 55989397.22
38. Administrative expenses
Item Current amount Amount of previous period
Employee benefits 79343163.63 64704357.03
Agency fee 4027178.08 12450245.35
Entertainment expenses 2857097.54 2167046.29
Depreciation expense 2567845.33 3850384.39
Office expenses 2364940.64 1831836.07
Maintenance expenses 985033.96 717959.58
Office expenses 496794.63 297270.72
Other Amortization 421749.41 436258.47
water and electricity 273581.21 431830.71
Other 4970447.17 6729038.14
Total 98307831.60 93616226.75
39. Financial expenses
Amount of
Item Current amount
previous period
The interest payments 12247386.77 --
Minus: Capitalization of interest 12237466.31 --
Interest income 28863878.27 30130066.10
Exchange gains and losses 9320742.60 7808608.84
Minus: Capitalization of exchange gains and losses -- --
Commission charges and others 1449724.20 815772.21
Total -18083491.01 -21505685.05
40. Other income
With respect to
Amount of previous
Subsidies (other sources of revenue) Current amount assets /
period
Related to revenue
VAT deduction 1483095.28 1062301.22 Related to revenue
Subsidies for job-for-training 165000.00 -- Related to revenue
Additional deductions for input tax 11384.12 174534.77 Related to revenue
Renovation of back streets and alleys
10000.00 -- Related to revenue
around farmers' markets (public health fund)
Subsidies for epidemic prevention -- 3245019.09 Related to revenue
Subsidies for keeping people in their jobs -- 125750.12 Related to revenue
VAT deduction in simplified method -- 166.87 Related to revenue
181ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
With respect to
Amount of previous
Subsidies (other sources of revenue) Current amount assets /
period
Related to revenue
Total 1669479.40 4607772.07
41. Investment Income
Current Amount of
Item
amount previous period
Long-term equity investment income calculated by the equity
-105321.37-92348.97
method
Dividend income from investments in other equity instruments 692580.00 599760.00
Yield on maturity of structured deposits 1196580.44 15217058.60
Total 1783839.07 15724469.63
42. Income from changes in fair value
Amount of previous
The source of the fair value change income Current amount
period
Trading financial assets 11828130.44 --
43. Credit impairment loss (loss marked with "-")
Item Current amount Amount of previous period
Accounts receivable bad debt loss -4433371.85 -1865160.28
Other losses on receivable bad debts -2362779.29 1380875.47
Bad debt losses on notes receivable -999068.57 125285.66
Total -7795219.71 -358999.15
44. Impairment loss of assets (loss is marked with "-")
Amount of previous
Item Current amount
period
Losses from falling inventory prices 268941.60 --
45. Income from asset disposal
Current Amount of
Item
amount previous periodGain on disposal of fixed assets (loss is marked with "-")） -8852.73 11429.23
46. Non-operating income
Amount booked into
Amount of previous
Item Current amount current non-recurring
period
profits and losses
Compensation - 30000000.00 -
Penalty income 1506996.67 670000.10 1506996.67
Other 210438.20 2600.16 210438.20
Income from sale of waste 28700.00 21161.31 28700.00
Total 1746134.87 30693761.57 1746134.87
182ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
47. Non-operating expenses
Amount booked into
Amount of
Item Current amount current non-recurring
previous period
profits and losses
Public welfare donation expenditure 31464.96 89121.31 31464.96
Loss of non-current assets damaged and
16439.2069581.0816439.20
scrapped
Penalty 85686.90 -- 85686.90
Other 74538.68 1525401.58 74538.68
Total 208129.74 1684103.97 208129.74
48. Income tax expenses
(1) Income tax expense details
Item Current amount Amount of previous period
Current income tax calculated according to the
125965276.65173172138.96
tax law and relevant provisions
Deferred tax expense -57160740.87 -62701304.18
Total 68804535.78 110470834.78
(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 286404205.51 400433589.16
Income tax expense at statutory (or applicable) rate (gross
71601051.38100108397.29
profit *25%)
Impact of different tax rates applied to certain subsidiaries -810905.02 -523491.63
Adjustment of income tax for the current period of the
-378391.66--
previous period
The profits and losses of joint ventures and associated
26330.35-126852.76
enterprises calculated by equity method
Tax-free income (marked with "-") -173145.00
Non-deductible costs expenses and losses 563064.63 15046324.88
Take advantage of the tax impact of unrecognized deductible
losses and deductible temporary differences in previous -2008151.87 -4257625.20
years (fill in with "-")
Tax effects of deductible losses and deductible temporary
-15317.03692907.43
differences are not recognized
Reduction of Corporate income tax -- -468825.23
Income tax expense 68804535.78 110470834.78
49. Notes for items in the statement of cash flows
183ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
(1) Receipt of other cash related to operating activities
Item Current amount Amount of previous period
Interest Income 39813057.28 11768922.91
Receivables and others 338784024.72 42259017.80
Total 378597082.00 54027940.71
(2) Other cash payments related to operating activities
Item Current amount Amount of previous period
Charges 1449724.20 815772.21
Out-of-pockets expenses 50267187.02 72468127.90
Payables and others 231759408.78 1291173.09
Total 283476320.00 74575073.20
(3) Receipt of other cash related to investment activities
Item Current amount Amount of previous period
Financing products and etc. 797803419.53 1000000000.00
(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 217599669.73 289962754.38
Plus: impairment loss on assets -268941.60 --
Credit impairment loss 7795219.71 358999.15
Depreciation of Fixed Assets Depreciation of Usability Assets
Depreciation of Investment Real Estate Depreciation of Oil and Gas
29162034.6429954172.05
Assets Depreciation of Productive Biological Assets (Items not
applicable can be deleted)
184ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Amount of
Additional information Current amount
previous period
Amortization of intangible assets -- --
Amortization of long-term prepaid expenses 240227.24 100458.19
Loss on disposal of fixed assets intangible assets and other
13451.61-11429.23
long-term assets (marked with "-" for gains)
Loss on the scrapping of fixed assets (marked with "-" for
16439.2069581.08
income)
Loss from changes in fair value (marked with "-" for earnings) -11828130.44 --
Financial expenses (revenue marked with "-") 450266.20 647689.01
Loss on investment (marked with "-" for income) -1783839.07 -15724469.63
Deferred tax assets decreased (marked with "-" for increase) -57380478.73 -66303918.73
Deferred tax liability increased (marked with "-" for decrease) 85543.83 3602614.55
Decrease in stock (marked with "-" for increase) -1600400189.74 231291659.65
Decrease of operating receivable items (marked with "-" for
79815735.11-54000863.50
increase)
Increase in operational payable items (marked with "-" for
130530884.37-134783233.80
decrease)
other -- --
Net cash flow from operating activities -1205952107.94 285164013.17
2. Major investment and financing activities that do not involve
----
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 612293635.15 2669103926.82
Minus: Opening balance of cash 2669103926.82 1507189760.35
Plus: ending balance of cash equivalents -- --
Minus: Beginning balance of cash equivalents -- --
Net increase in cash and cash equivalents -2056810291.67 1161914166.47
（2）Composition of cash and cash equivalents
Item Ending balance Opening balance
1. Cash 612293635.15 2669103926.82
Including: cash on hand 12082.00 61121.83
Bank deposits available for payment at any time 372181553.15 1026042804.99
Other monetary fund readily available for payment 240100000.00 1643000000.00
2. Cash equivalents -- --
Including: bond investments maturing within three months -- --
3. Closing cash and cash equivalents balance 612293635.15 2669103926.82
Where: the parent company or a subsidiary of the group uses
----
restricted cash and cash equivalents
185ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Note：CNY 64521214.48 in bank deposits available for payment at any time is reclassified to asset
held for sales.
51. Assets whose ownership or use rights are restricted
Item Ending book value Reason for limitation
Accounts receivables 50440116.24 Pledge of short-term loans
Cash at bank and Cash Equivalent 3500000.00 Frozen by litigation
funds for the construction of public facilities in
Cash at bank and Cash Equivalent 5674439.78
and around the city of Longgang District
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 153319.14 6.3757 977516.84
Hong Kong dollars 6667176.97 0.8176 5451083.89
Accounts receivable
Including: US dollar 16000.00 6.3757 102011.20
Hong Kong dollars 4905150.10 0.8176 4010450.72
Other payables
Including: US dollar 733761.87 6.3757 4678245.55
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 1237002.86 1494479.40 Other Income
earnings
Epidemic prevention Related to
Fiscal allotment 3245019.09 - Other Income
subsidy earnings
Related to
Employment subsidies Fiscal allotment 125750.12 165000.00 Other Income
earnings
Total 4607772.07 1659479.40
VI. Changes to the scope of consolidation
1. Business combination involving enterprises not under common control
1) On 30 April 2021 the company and Guangzhou Bopi Business Management Consulting Co. Ltd.
signed a cooperative development agreement the 51.00% stake in Guangdong Jianbang Group
(Huiyang) Industrial Co. Ltd. (hereinafter referred to as "Guangdong Jianbang") was sold to the
186ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
company for CNY 0.45 billion. At the time of the acquisition Guangdong Jianbang owned all the
interests in Linxi County (later renamed "Shenfang Lin Xinyuan") which accounted for 95.48% of the
total assets so the transaction does not constitute a business merger. On 11 May 2021 the company
took control of Guangdong Jianbang and incorporated it into its consolidated statements from that day.
2) Shenzhen real estate group entrusted Evergrande real estate group Pearl River Delta Real Estate
Development Co. Ltd. to develop real estate the specific contents include but are not limited to the
management of Project Investigation planning design bidding project progress quality safety
marketing cost etc. however the financial and fund management is the responsibility of Guangdong
Jianbang Group (Huiyang) Industrial Company Limited. In the course of project management contracts
for procurement design engineering supervision publicity sales property etc. need to be signed with
foreign parties guangdong Jianbang Group (Huiyang) Industrial Co. Ltd. entrusted Evergrande real
estate group Pearl River Delta Real Estate Development Co. Ltd. to sign in the name of Guangdong
Jianbang Group (Huiyang) Industrial Co. Ltd. all expenses incurred in the operation are borne by
Guangdong Jianbang Group (Huiyang) Industrial Co. Ltd. .
3) Guangzhou Bopi Enterprise Management Consulting Co. Ltd. is committed to achieving a
cumulative net profit of no less than CNY 1.25 billion from 2021 to 2025 for Guangdong Jianbang Group
(Huiyang) Industrial Co. Ltd. the total net profit is not affected by the land use condition and economic
and technical index of the Government Adjustment Project. The accumulated realized net profit from
2021 to 2023 is no less than CNY 0.3 billion; that of 2021-2024 is no less than CNY0.75 billion; and that
of 2021-2025 is no less than CNY 1.25 billion. In order to fulfill the net profit commitment of Guangzhou
Bopi Business Management Consulting Co. Ltd. the parties before 31 December 2026 shall
complete the accounting of project’s net profit as of December 312025 and shall comply with the
following agreement:
If Guangzhou Bopi Management Consulting Co. Ltd. fails to meet its performance commitments then
when distributing the profits of the project in 2025 Guangzhou Bopi Enterprise Management Consulting
Co. Ltd. will pay part or all of its distributed profits to the Shenzhen real estate group until the
cumulative distribution of profits from 2021 to 2025 reached the target of CNY 0.6375 billion in the profit
commitment; if Guangzhou Bopi Enterprise Management Consulting Co. Ltd. has paid all the profits
distributed in 2025 to the Shenzhen real estate group and the cumulative distributed profit of Shenzhen
real estate group still cannot reach CNY0.6375 billion committed in profit distribution the shortfall will be
made up by Guangzhou Bopi Business Management Consulting Co. Ltd. by 31 May 2026; and after
Guangzhou Bopi Business Management Consulting Co. Ltd. has made up the shortfall to Shenfang
Group the profits generated by Guangdong Jianbang Group (Huiyang) Industrial Co. Ltd. after 31
December 2025 shall be allocated to Guangzhou Bopi Enterprise Management Consulting Co. Ltd.until the cumulative distribution profit of Guangzhou Bopi Enterprise Management Consulting Co. Ltd.reached CNY 0.6125 billion in accordance with the profit commitment the portion of the total net profit
of guangdong Jianbang Group (Huiyang) Industrial Co. Ltd. exceeding CNY1.25 billion is distributed
between Guangzhou Bopi Enterprise Management Consulting Co. Ltd. and Shenzhen Real Estate
Group Co. Ltd. in proportion to their equity.Evergrande real estate group Pearl River Delta Real Estate Development Co. Ltd. provides joint and
several liability for profit commitment and difference compensation of Guangzhou Bopi Enterprise
Management Consulting Co. Ltd. .
2. Other
On 27 October 2021 the group set up a wholly-owned subsidiary in Shenzhen Shenzhen Shenfang
Chuanqi Real Estate Development Co. Ltd. with registered capital 30 million yuan.
187ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
VII. Interest in other entities
1. 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
Acquiring
American Great Wall Co. Real estate through
U.S. U.S. 70.00 --
Ltd development establishment or
investment
Acquiring
Shenzhen City Property Property through
Shenzhen Shenzhen 95.00 5.00
Management Ltd. management 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 Zhiye Co. through
Hong Kong Hong Kong and 100.00 --
Ltd. establishment or
management
investment
Acquiring
Investment
Xin Feng Enterprise Co. through
Hong Kong Hong Kong and 100.00 --
Ltd. establishment or
management
investment
Acquiring
Shenzhen City Shenfang Commercial through
Shenzhen Shenzhen 95.00 5.00
Free Trade Trading Ltd. trade establishment or
investment
188ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Principal
Registration Business Shareholding% Acquisition
Name place of
place nature Direct Indirect method business
Acquiring
Shenzhen City Shenfang through
Shenzhen Shenzhen Investment 90.00 10.00
Investment Ltd. establishment or
investment
Shenzhen Special
Acquiring
Economic Zone Real
Real estate through
Estate (Group) Shenzhen Shenzhen 95.00 5.00
development establishment or
Guangzhou Property and
investment
Estate Co. Ltd.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 Xizun real estate limited company
Shenzhen Special Economic Zone Real Estate (Group) Guangzhou Property and Estate Co. Ltd.Fresh Peak Real Estate Dev. Construction (Wuhan) Co. Ltd. and Beijing Shenfang Property
Management Co. Ltd. They are presented on the basis of discontinued operations; these five
subsidiaries have made full provision for impairment of debt for the companies outside the consolidation
scope.* 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% Acquisition
Name place of
place nature
business Direct Indirect
method
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
Guangdong Fengkai County Lianfeng Fengkai Fengkai Acquiring through
Manufacturing -- 90.00
Cement Manufacturing Co. Ltd. Guangdong Guangdong establishment or
189ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Principal
Registration Business Shareholding% Acquisition
Name place of
place nature Direct Indirect method business
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.
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 onthe merger of Shenzhen Zhen Tung Engineering Ltd and Shenxi Limited” (Shenfang [1997] No.19)
all 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
190ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021longer exist. According to “Accounting Standard for Business Enterprises No. 33-Consolidated FinancialStatements” 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 -85336.59 -- -19533105.73
Xinfeng Investment Co. Ltd. 45.00 -1375.31 -- -116180387.59
Baiwei Real Estate Co. Ltd. 20.00 -2692.95 -- -3889709.36
Guangdong Jianbang Group
49.00-3120424.87--428698890.60
(Huiyang) Industrial Co. Ltd.
(3 )Key financial information about material non-wholly owned subsidiaries
2021.12.31
Name Non-current Current Non-current
Current assets Total assets Total liabilities
assets liabilities liabilities
American Great
585669.0617615753.0718201422.1399105956.86--99105956.86
Wall Co. Ltd
Xinfeng
Investment Co. 4748.07 36016.90 40764.97 258219487.07 -- 258219487.07
Ltd.Baiwei Real
957.41--957.4132908874.92--32908874.92
Estate Co. Ltd.Guangdong
Jianbang Group
(Huiyang) 1190571804.12 3795473.63 1194367277.75 1201698603.08 125920.77 1201824523.85
Industrial Co.Ltd.Continued(1)：
2020.12.31
Name Current Non-current Current Non-current
Total assets Total liabilities
assets assets liabilities liabilities
American Great
135920.5218027985.5018163906.02101822102.87--101822102.87
Wall Co. Ltd
Xinfeng
Investment Co. 4769.05 36016.90 40785.95 258216451.81 -- 258216451.81
Ltd.Baiwei Real
985.56--985.5632895438.31--32895438.31
Estate Co. Ltd.Continued(2)：
Name Year ended 2021.12.31 Year ended 2020.12.31
191ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Cash flows
Total Cash flows Total
Operating Operating from
Net profit comprehensive from operating Net profit comprehensive
income income operating
income activities income
activities
American
Great Wall 632524.86 -284455.30 -284455.30 352837.90 839012.25 -774074.99 -774074.99 -774075.02
Co. Ltd
Xinfeng
Investment - -3056.24 -3056.24 -20.98 -- -53650.12 -53650.12 --
Co. Ltd.Baiwei Real
Estate Co. - -13464.76 -13464.76 -28.15 - -53264.03 -53264.03 --
Ltd.Guangdong
Jianbang
Group
--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
2021.12.312020.12.31
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 272168.28 377489.65
Aggregate amount of share of
Net profit -105321.37 -92348.97
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
prior periods profit)for the year as at 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
192ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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
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 specific
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 resulting 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.
193ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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 position 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
56.87% of the Group's total accounts receivable (in 2020: 53.97%); Among other receivables of the
Group other receivables from the top five companies in arrears amount to 63.70% (2020: 61.40%) 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 fulfilling 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.The Group finances its working capital through funds generated from its operations and bank and other
borrowings. As at 31 December 2021 the Group's unutilized bank loan amount is CNY 0 million (31
December 2020: 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) :
2021.12.31
Item Within one One to Five More than five
Total
year years years
Financial liabilities:
Short-term loans 5044.01 -- -- 5044.01
Notes payable 24737.64 -- -- 24737.64
Accounts payable 14144.76 -- -- 14144.76
194ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Interest payables 1653.53 -- -- 1653.53
Other payables 56484.21 -- -- 56484.21
Liabilities held for sale 5791.56 783.69 -- 6575.25
Guarantees for client 39237.82 -- -- 39237.82
Total financial liabilities and
141301.976575.25-147877.22
contingent liabilities
At the beginning 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) :
2020.12.31
Item Within one More than five
One to Five years Total
year years
Financial liabilities:
Short-term loans 7689.40 -- -- 7689.40
Accounts payable 17692.66 -- -- 17692.66
Interest payables 1653.53 -- -- 1653.53
Other payables 26056.99 -- -- 26056.99
Long-term payables -- 748.02 -- 748.02
Guarantees for client 37135.79 -- -- 37135.79
Total financial liabilities and
90228.36748.02--90976.38
contingent liabilities
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.
（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
liabilities 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.
195ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
During the reporting period the Group operates by its own working capital. As at 30 June 2021 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 financial
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
liabilities 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 2021 the Group's liability to asset ratio was 31.62% (31
December 2020: 25.92%).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 indirectly 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
As at December 31 2021 the assets and liabilities measured at fair value are listed as follows
according to the above three levels :
196ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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 514024710.91 -- -- 514024710.91
(2) Investment in other equity
----36322704.3336322704.33
instruments
Total assets measured at fair
514024710.91--36322704.33550347415.24
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 36322704.33 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 accounts receivable other receivables short-term borrowings accounts payable other
payables long-term borrowings 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
Registered Percentage of
Registration Business Shareholding
Name capital voting
place nature percentage %
(CNY0000) rights %
Investment
Shenzhen
Shenzhen Investment real estate
Guangdong 2800900.00 57.19 57.19
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 registered capital of the parent company is not changed.
2. Information about the subsidiaries of the Group
For information about the subsidiaries of the Group refer to Note 02.
3. Information on other related parties
197ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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
4. Transactions with related parties
(1)Purchases/sales
* Purchase of goods/receiving of services
Nature of Year ended Year ended
Related party
transaction 2021.12.31 2020.12.31
Elevator
Shenzhen RongHua JiDian Co. Ltd 1329886.76 1293962.28
maintenance
* Sales of goods/rendering of services
Nature of Year ended Year ended
Related party
transaction 2021.12.31 2020.12.31
Shenzhen Jian'an Group Co. Ltd. Decoration services 7614678.90 7258154.64
Shenzhen RongHua JiDian Co. Ltd Property Services 68772.00 68772.00
(2) Trust/contracting arrangement
* contracting undertaken by related parties on behalf of the Group
contracting
Inception Maturity
main Name of Type of contracting revenue
date of date of
contractor related party contracted revenue recognized in
contracting contracting
2020
Shantou City
Shenzhen
Huafeng
Jian'an
Real Estate Construction 19 Oct. 2018 1 May 2021 Negotiations 30985550.60
Group Co.Devepment
Ltd.Co. Ltd
* Funding from related party
Amount of
Related party Inception date Maturity date Note
funding
198ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Amount of
Related party Inception date Maturity date Note
funding
Funds received
The principal of the
loan was repaid on
Shenzhen Investment 22 December 2016
16535277.94 9 November 2006 22 December 2016
Shareholding Co. Ltd and the remaining
amount is interest
payable.Note: at the end of the reporting period the balance of interest on loan to Shenzhen Investment Holding
Co. Ltd. is CNY 16535277.94.
（3）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:
Item Year ended 2021.12.31 Year ended 2020.12.31
Remuneration of key management personnel 844.64 884.86
（4）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 2021 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
2021.12.312020.12.31
Provision for Provision for
Item Related party bad and bad and
Book value Book value
doubtful doubtful
debts debts
Accounts Shenzhen Fresh Peak
1118383.881118383.881144740.491144740.49
receivable property consultant Co. Ltd
Guangdong Province
Other
Huizhou Luofu Hill Mineral 10465168.81 10465168.81 10465168.81 10465168.81
receivables
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 Property
12559290.5812559290.5812559290.5812559290.58
receivables Limited
199ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
2021.12.312020.12.31
Provision for Provision for
Item Related party bad and bad and
Book value Book value
doubtful doubtful
debts debts
Other
Bekaton Property Limited 18689545.58 18870785.54 18870785.54 18870785.54
receivables
Other Shenzhen Shenfang
237648.82237648.82237648.82237648.82
receivables Department Store Co. Ltd.Other Shenzhen RongHua JiDian
475223.46475223.46475223.4623761.17
receivables Co. Ltd
Xi’an Fresh Peak property
Other
management& Trading Co. 8419205.19 8419205.19 8419205.19 8419205.19
receivables
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
Item Related party 2021.12.31 2020.12.31
Interest payables Shenzhen Investment Shareholding Co. Ltd 16535277.94 16535277.94
Accounts payable Shenzhen Jian'an Group Co. Ltd. 25576607.95 54193856.16
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 8827940.07 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 193016852.52 --
XI. Commitments and contingencies
1. Significant commitments
(1) Capital commitments
Capital commitments entered into but not
2021.12.312020.12.31
recognized in the financial statements
Material sales or purchases contracts 475137087.80 153945220.09
(2) Information on implementation of commitments in previous years
Refer to Note X.5 (2) for detailed of contracting of related parties.As at 31 December 2021 there is no other commitment to be disclosed.
200ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
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 2021.As at 31 December 2021 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
(2) Contingent liabilities arising from guarantee provided to other entities and related financial effects.
As at 31 December 2021 the Group provides commercial housing purchaser with guarantees at CNY
392378200.00 for the following loans:
Amount (In ten
Item Duration Note
thousand)
Until the Premises Permit mortgage
Shengfang CuiLin Building 2802.31
registration is finished and in bank custody
ChuanQi DongHu Building (Former Until the Premises Permit mortgage
2924.43
DongHuDiJing Building) registration is finished and in bank custody
TianYue Bay Until the Premises Permit mortgage 33511.08
201ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Amount (In ten
Item Duration Note
thousand)
registration is finished and in bank custody
Total 39237.82(3) Other contingencie（s Not including contingent liabilities that are highly unlikely to result in an outflowof 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 2021 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 0.88 (including tax) totaling CNY 89026080.00
to all shareholders on 1011660000 shares as at 31 December 2021.
2. The sale of Shenzhen Shenfang Investment Co. Ltd.
In order to optimize and adjust the industrial structure on 30 December 2021 the group and its
subsidiary Shenzhen Shenfang Investment Co. Ltd. signed an Equity Purchase Agreement with
Shenzhen Guomao Property Management Co. Ltd. the total holding of Shenzhen Property
Management Co. Ltd. 100% equity transfer to Shenzhen International Trade Property Management
Co. Ltd. the transfer price is CNY 196676.7 million. On 11 February 2022 the company has
completed the above equity transfer.As at 17 March 2022 there is no other post balance sheet date events in the group to be disclosed.XIII. Other significant items
1. Termination of operation
Amount of previous
Item Current amount
period
Income from Termination of Operations (A) 163141074.63 151546323.15
Less: termination expenses (B) 160034977.84 149890088.34
Gross profit from terminated operations (C) 4470327.62 5171663.63
Minus: Income tax expense for termination of
1123400.141373074.99
operations (D)
Net profit from operating activities (E=C-D) 3346927.48 3798588.64
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) 3346927.48 3798588.64
Including: profit from terminated operations
3346927.483798588.64
attributable to shareholders of the parent company
202ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Amount of previous
Item Current amount
period
Termination profit attributable to minority
----
shareholders
Net cash flow from operating activities -3487467.47 -2615700.26
Net cash flow from investment activities -528491.28 -615198.54
Net cash flow from financing activities - --
Note: The above items are the financial data of Shenzhen Property Management Co. Ltd. which has
signed an agreement for sale.XIV. Notes for main items in the parent company's financial statements
1. Accounts Receivable
(1) Disclosed by aging
Aging 2021.12.31 2020.12.31
Within one year 9893622.09 5281165.00
One to two years -- --
Two to three years -- 66518.00
More than three years 9710249.94 10221420.93
Subtotal 19603872.03 15569103.93
Less: bad debt provision 9895586.10 10151079.19
Total 9708285.93 5418024.74
(2) Disclosed by categories
2021.12.31
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
an combination basis
Including： -- -- -- -- --
Receivables from related
parties within consolidated 5031038.74 25.67 - - 5031038.74
scope
Receivables from other
4923418.0925.11246170.905.004677247.19
customers
Total 19603872.03 100.00 9895586.10 50.48 9708285.93
Continued：
2020.12.31
Item Book balance Bad debt provision
Provision Book value
Amount Proportion Amount
proportion
203ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
2020.12.31
Item Book balance Bad debt provision
Provision Book value
Amount Proportion Amount
proportion
Bad debt provisions made on
10132205.2465.0810132205.24100.00--
an individual basis
Bad debt provisions made on
5436898.6934.9218873.950.355418024.74
an combination basis
Including： -- -- -- -- --
Receivables from related
parties within consolidated 5059419.69 32.50 -- -- 5059419.69
scope
Receivables from other
377479.002.4218873.955.00358605.05
customers
Total 15569103.93 100.00 10151079.19 65.20 5418024.74
Bad debt provision made on an individual basis:
2021.12.312020.12.31
Expected
Item Expected Book Bad debt credit Book Bad debt
Reason credit loss
balance provision loss rate balance provision
rate (%)
(%)
long-term
accounts
receivable Uncollected
9649415.209649415.20100.0010132205.2410132205.24100.00
from is expected
property
sales
Bad debt provision made on a combination basis:
Combined withdrawal item: related parties in consolidation scope
2021.12.312020.12.31
Aging Expected Expected Accounts Bad debt Accounts Bad debt
credit loss credit loss
receivable provision receivable provision
rate (%) rate (%)
Within 1 year 5031038.74 -- -- 5059419.69 -- --
Combined withdrawal item: receivables from other customers
2021.12.312020.12.31
Expected Expected Accounts Bad debt Accounts Bad debt
credit loss credit loss
receivable provision receivable provision
rate (%) rate (%)
Within 1 year 4923418.09 246170.90 5.00 310961.00 15548.05 5.00
1 to 2 years -- -- -- -- -- --
2 to 3 years -- -- -- 66518.00 3325.90 5.00
Total 4923418.09 246170.90 5.00 377479.00 18873.95 5.00
(3) Additions recoveries or reversals of provision for the current period
204ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Bad debt provision
2020.12.3110151079.19
Additions --
Recoveries or reversals 255493.09
Written-off --
2021.12.319895586.10
(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 Haiyan Hotel Co. Ltd. 5031038.74 25.66 --
Shenzhen Xinfeng Real Estate
1118383.885.701118383.88
Consulting Co. Ltd.Daxing Automotive parts Co. Ltd. 1857730.28 9.48 1857730.28
Weidong Wang 1200000.00 6.12 1200000.00
Guangyao Cai 876864.11 4.47 876864.11
Total 10084017.01 51.43 5052978.27
2. Other receivables
(1) Disclosure by aging
Aging 2021.12.31 2020.12.31
Within 1 year 568919874.78 342045464.68
1 to 2 years 209903464.26
79875511.65
2 to 3 years 78698092.26 140372735.75
More than 3 years 1522297306.33 1399130297.43
Subtotal 2379818737.63 1961424009.51
Less: bad debt provision 792517845.87 801009814.12
Total 1587300891.76 1160414195.39
(2) Disclosure by nature
2021.12.312020.12.31
Item Bad debt Bad debt
Book balance Book Value Book balance Book Value
provision provision
Other receivables
------165460.00--165460.00
from government
Other receivables
from the
203659.15--203659.15307.17--307.17
collecting and
paying on behalf
Other receivables
from other 4801159.55 4056565.36 744594.19 5464176.55 3647753.92 1816422.63
customers
Other receivables
137211313.52137211313.52--137211313.52137211313.52--
from related
205ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
2021.12.312020.12.31
Item Bad debt Bad debt
Book balance Book Value Book balance Book Value
provision provision
parties
Other receivables
in consolidation 2237602605.41 651249966.99 1586352638.42 1818582752.27 660150746.68 1158432005.59
scope
Total 2379818737.63 792517845.87 1587300891.76 1961424009.51 801009814.12 1160414195.39
(3) 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 (%)
Other receivables from
----------
government
Other receivables from
the collecting and 203659.15 -- -- 203659.15 203659.15
paying on behalf
Other receivables from
783783.365.0039189.17744594.19783783.36
other customers
Other receivables from
----------
related parties
Total 987442.51 3.97 39189.17 948253.34 987442.51
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 shall
be made on an individual
basis
Other receivables Could be
2237602605.4129.10651249966.991586352638.42
in consolidation scope 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
Could be
shall be made on an -- -- -- --
uncollectible
individual basis
Other receivables from Could be
4017376.19100.004017376.19--
other customers uncollectible
Other receivables from Could be
137211313.52100.00137211313.52--
related parties uncollectible
Total 141228689.71 100.00 141228689.71 --
206ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Bad Debt Provision as at December 31 2020:
As at December 31 2020 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 is
drawn on a combination
basis
Other receivables from
165460.00----165460.00
government
Other receivables from
--------
employee’s petty cash
Other receivables from
the collecting and paying 307.17 -- -- 307.17
on behalf
Other receivables from
1912023.825.0095601.191816422.63
other customers
Other receivables from
--------
related parties
Total 2077790.99 4.60 95601.19 1982189.80
As of December 31 2020 bad debt provisions 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 shall
be made on an individual
basis
Other receivables in Could be
1818582752.2736.30660150746.681158432005.59
consolidation scope uncollectible
As of December 31 2020 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 shall
be made on an individual
basis
receivables from other Could be
3552152.73100.003552152.73--
customers uncollectible
receivables from related Could be
137211313.52100.00137211313.52--
parties uncollectible
Total 140763466.25 100.00 140763466.25 --
(4) Bad debt provisions in the current period
Bad debt provision The first stage The second stage The third stage Total
207ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Expected Expected credit losses Expected credit loss
credit losses over the entire duration over the entire duration
over the next (no credit impairment (credit impairment has
12 months occurred) occurred)
Balance as at
948253.34660150746.68139910814.10801009814.12
December 31 2020
Current period -909064.17 -- 1317875.61 408811.44
Current roll-back -- -- -- --
Current Resale -- -- -- --
This verification -- -- -- --
Other changes -- -8900779.69 -- -8900779.69
Balance as of
39189.17651249966.99141228689.71792517845.87
December 31 2021
Note：Other changes were mainly due to the exchange rate movements.
(5) The top five units of ending balance of other receivables
Proportion of
Ending balance Ending balance
Nature of other total ending
Name of the entity of other Aging of bad debt
receivables balance of other
receivables provision
receivables (%)
Within 1 year 1 to
Huafeng Real Estate Receivables from
786160642.90 3 years more 33.03 --
Devepment Co. Ltd subsidiary
than 3 years
Guangdong Jianbang
Receivables from
Group (Huiyang) Industrial 564501364.30 Within 1 year 23.72 --
subsidiary
Co. Ltd.Receivables from Within 1 year
Xinfeng enterprise Limited. 530624324.60 22.30 508377320.74
subsidiary more than 5 years
Shenzhen Longgang Receivables from
108417692.30 Within 1 year 4.56 --
Industrial Co. Ltd. subsidiary
American Great Wall Co. Receivables from
94502416.46 More than 5 years 3.97 94502416.46
Ltd subsidiary
Total 2084206440.56 87.58 602879737.20
208ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
3. Long-term equity investment
2021.12.312020.12.31
Item
Book balance Impairment loss The book value Book balance Impairment loss The book value
Invest in subsidiaries 1735224157.90 152839271.15 1582384886.75 303045949.42 152839271.15 150206678.27
Investment in joint ventures 9455465.38 9455465.38 - 9455465.38 9455465.38 --
Invest in associated enterprises 2794548.48 2522380.20 272168.28 2899869.88 2522380.20 377489.68
Total 1747474171.76 164817116.73 1582657055.03 315401284.68 164817116.73 150584167.95
(1) Invest in subsidiaries
Provision for
Increase in Impairment loss
Investee unit 2020.12.31 The reduced 2021.12.31 impairment in the
current The ending balance
current period
Shenzhen Property Management Co. Ltd. 12821791.52 -- 12821791.52 - -- --
Shenzhen Haiyan 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)
19000000.00----19000000.00--19000000.00
Guangzhou Property and Estate Co. Ltd.Shenzhen Zhentong New Electromechanical Industry
11332321.45----11332321.45----
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 -- --
Kai Luk Company Limited 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 -- --
209ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Provision for
Increase in Impairment loss
Investee unit 2020.12.31 The reduced 2021.12.31 impairment in the
current The ending balance
current period
Beijing fresh peak property development management
64183888.90----64183888.90--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
--995000000.00--995000000.00----
Co. Ltd.Total 303045949.42 1445000000.00 12821791.52 1735224157.90 -- 152839271.15
Note: At December 2021 the Group decided to transfer its 100% equity in Shenzhen Property Management Co. Ltd. to Shenzhen International Trade Property
Management Co. Ltd. for business development ; The Company has reclassified the investment in Shenzhen Property Management Co. Ltd. to assets held for
sale.
(2) Investment in joint ventures and joint ventures
Change of increase or decrease in current period
Under the Declare
Other Provision Ending balance
Investee unit 2020.12.31 Additional equity method Changes payment of Reduce comprehensive for 2021.12.31 of impairment
/new To confirm the in other cash other
investment Income impairment provision
investment Investment interests dividends or
adjustment To prepare
profit and loss profits
*
joint
vent
ures
Fengkai Xinhua
9455465.38----------------9455465.389455465.38
Hotel
210ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Change of increase or decrease in current period
Under the Declare
Other Provision Ending balance
Investee unit 2020.12.31 Additional equity method Changes payment of Reduce comprehensive for 2021.12.31 of impairment
/new To confirm the in other cash other
investment Income impairment provision
investment Investment interests dividends or
adjustment To prepare
profit and loss profits
subtotal 9455465.38 -- -- -- -- -- -- -- -- 9455465.38 9455465.38
*
Joint
vent
ure
Shenzhen
Ronghua 1454444.32 -- -- -105321.37 -- -- -- -- -- 1349122.95 1076954.64
JiDian Co. ltd
Shenzhen
Runhua
1445425.56----------------1445425.561445425.56
Automobile
trading Co. Ltd
subtotal 2899869.88 -- -- -105321.37 -- -- -- -- -- 2794548.51 2522380.20
Total 12355335.26 -- -- -105321.37 -- -- -- -- -- 12250013.89 11977845.58
211ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
4. Operating Income and Operating Costs
Year ended 2021.12.31 Year ended 2020.12.31
Item
Income Cost Income Cost
Main business 774049479.78 198814980.86 911815174.45 241307783.52
Other business 16130.55 -- 24095.25 --
Total 774065610.33 198814980.86 911839269.70 241307783.52
(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 706622743.82 166178270.82 860010047.62 211257440.88
Lease 67426735.96 32636710.04 51805126.83 30050342.64
Total 774049479.78 198814980.86 911815174.45 241307783.52
(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 774049479.78 198814980.86 911815174.45 241307783.52
5. Investment Income
Item Current amount Amount of previous period
Long-term equity investment income calculated
-105321.37-92348.97
by the equity method
Dividend income from investments in other
692580.00599760.00
equity instruments
Investment gains from structured deposit 1196580.44 15217058.60
Total 1783839.07 15724469.63
XV. Supplementary Information
1. Statement of non-recurring gains and losses for the current period
Current
Item instructions
amount
Gains and losses on disposal of illiquid assets -13451.61
Government subsidies included in current profits and losses (except government
subsidies that are closely related to the normal business of the Group and are
1669479.40
continuously enjoyed in accordance with national policies and certain standard
quota or quantitative amount)
Profit or loss on entrusted investments or assets management 13024710.91
Unmatured interest on structured deposit
212ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Annual Report 2021
Current
Item instructions
amount
The receivables for which the impairment test is conducted separately will be
482790.04
turned back
Other non-operating income and expenses other than those mentioned above 1542604.01
Other items of profit and loss that meet the definition of non-recurring profit and
loss
Total non-recurring gains and losses 16706132.75
Minus: income tax impact of non-recurring gains and losses 4176533.19
Net non-recurring gains and losses 12529599.56
Minus: impact of non-recurring net gains and losses attributable to minority
shareholders (after tax)
Non-recurring gains and losses attributable to common shareholders of the
12529599.56
Group
2. Return on equity and earnings per share
Weighted Average Net Earnings per share
Profit in reporting period
Assets Yield % Basic earnings per share
Net income attributable to the common shareholders of
5.72%0.2183
the Group
Net profit attributable to common shareholders of a
company after deducting non-recurring gains and 5.40% 0.2059
losses
213
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