SHENZHEN SPECIAL ECONOMIC ZONE REAL ESTATE &
PROPERTIES (GROUP) CO. LTD.
ANNUAL REPORT 2020
March 2021
2
Part I Important Notes Table of Contents and Definitions
The Board of Directors (or the “Board”) the Supervisory Committee as well as the directors
supervisors and senior management of ShenZhen Special Economic Zone Real Estate &
Properties (Group) Co. Ltd. (hereinafter referred to as the “Company”) hereby guarantee
the factuality accuracy and completeness of the contents of this Report and its summary and
shall be jointly and severally liable for any misrepresentations misleading statements or
material omissions therein.Liu Zhengyu chairman of the Company’s Board Zhao Zhongliang 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 Guideline No. 3 of the Shenzhen Stock Exchange on
Information Disclosure by Industry—for Listed Companies Engaging in Real Estate.Risks facing the Company have been explained in detail in “IX Prospects” in “Part IVOperating Performance Discussion and Analysis” herein.The Board has approved a final dividend plan as follows: based on the total share capital of
1011660000 shares on 31 December 2020 a cash dividend of RMB0.87 (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.Table of Contents
Part I Important Notes Table of Contents and Definitions ........................................................... 2
Part II Corporate Information and Key Financial Information ................................................... 5
Part III Business Summary ............................................................................................................. 10
Part IV Operating Performance Discussion and Analysis ........................................................... 12
Part V Significant Events ................................................................................................................ 35
Part VI Share Changes and Shareholder Information................................................................. 44
Part VII Preferred Shares ............................................................................................................... 50
Part VIII Convertible Corporate Bonds ........................................................................................ 51
Part IX Directors Supervisors Senior Management and Staff .................................................. 52
Part X Corporate Governance ........................................................................................................ 62
Part XI Corporate Bonds ................................................................................................................ 69
Part XII Financial Statements ........................................................................................................ 70
Part XIII Documents Available for Reference………………………………………………….172
Definitions
Term Definition
“Shenzhen SASAC” or the “Municipal
SASAC”
The State-owned Assets Supervision and Administration Commission of
the People’s Government of Shenzhen Municipal
SIHC Shenzhen Investment Holdings Co. Ltd.
The “Company” the “Group” “SPG” or “we”
ShenZhen Special Economic Zone Real Estate & Properties (Group)
Co. Ltd. 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.Part II Corporate Information and Key Financial Information
I Corporate Information
Stock name SPG SPG-B Stock code 000029 200029
Stock exchange for stock
listing
Shenzhen Stock Exchange
Company name in Chinese 深圳经济特区房地产(集团)股份有限公司
Abbr. 深房集团
Company name in English
(if any)
ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd.
Abbr. (if any) SPG
Legal representative Liu Zhengyu
Registered address 45/F-48/F SPG Plaza Renmin South Road Shenzhen Guangdong P.R.China
Zip code 518001
Office address 47/F SPG Plaza Renmin South Road 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
Address
47/F SPG Plaza Renmin South Road
Shenzhen Guangdong P.R.China
47/F SPG Plaza Renmin South Road
Shenzhen Guangdong P.R.China
Tel. （86 755）82289517 （86 755）82297977
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
Newspapers designated by the Company for
information disclosure
Domestic: Securities Times and China Securities Journal
Overseas: Ta Kung Pao (HK)
Website designated by CSRC for publication of
this Report
http://www.cninfo.com.cn
Place where this Report is lodged
47/F SPG Plaza 3005 Renmin South Road Luohu District
Shenzhen 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
Company since going public (if any)
No change
Every change of controlling
shareholder since incorporation (if
any)
On 24 March 1999 the controlling shareholder was changed from Shenzhen
Investment Management Co. Ltd. to Shenzhen Construction Investment
Holdings Co. 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
2020 2019
2020-over-2019
change (%)
2018
Operating revenue (RMB) 1615009713.88 2548740319.49 -36.63% 2175187242.60
Net profit attributable to the
listed company’s shareholders
(RMB)
290229772.23 552452307.59 -47.47% 503498831.60
Net profit attributable to the
listed company’s shareholders
before exceptional gains and
losses (RMB)
253595334.11 524204812.66 -51.62% 490490702.80
Net cash generated from/used
in operating activities (RMB)
285164013.17 603607724.75 -52.76% 1062567405.59
Basic earnings per share
(RMB/share)
0.2869 0.5461 -47.46% 0.4977
Diluted earnings per share
(RMB/share)
0.2869 0.5461 -47.46% 0.4977
Weighted average return on
equity (%)
7.81% 15.90% -8.09% 16.35%
31 December 2020 31 December 2019
Change of 31
December 2020 over
31 December 2019
(%)
31 December 2018
Total assets (RMB) 4936916746.74 4909669536.09 0.55% 4665891514.25
Equity attributable to the listed
company’s shareholders
(RMB)
3797512488.22 3666874569.99 3.56% 3332259641.39
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
shareholders
Equity attributable to the listed company’s
shareholders
2020 2019 Ending amount Beginning amount
Under CAS 290229772.23 552452307.59 3797512488.22 3666874569.99
Adjusted as per IFRS
Under IFRS 290229772.23 552452307.59 3797512488.22 3666874569.99
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 256842391.67 339416103.73 621402307.38 397348911.10
Net profit attributable to the
listed company’s shareholders
28114908.77 69160076.95 101565292.91 91389493.60
Net profit attributable to the
listed company’s shareholders
before exceptional gains and
losses
28075623.63 57108647.36 101225798.44 67185264.68
Net cash generated from/used
in operating activities
-435258963.67 223016165.08 309652617.04 187754194.72
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 2020 2019 2018 Note
Gain or loss on disposal of non-current
assets (inclusive of impairment
allowance write-offs)
11429.23 -69739.73
Government subsidies charged to
current profit or loss (exclusive of
government subsidies given in the
Company’s ordinary course of business
at fixed quotas or amounts as per the
government’s uniform standards)
3370769.21 1168127.90 10243.00
Gain or loss on assets entrusted to other
entities for investment or management
15217058.60 31425651.98 16347157.53
Income from mature
structured deposits
Non-operating income and expense
other than the above
29009657.60 1118861.69 891652.84
Other gains and losses that meet the
definition of exceptional gain/loss
1237002.86
Interest income from undue structured
deposits
3950685.00
Less: Income tax effects 12211479.38 9415831.64 4171184.84
Total 36634438.12 28247494.93 13008128.80 --
Explanation of why the Company reclassifies as recurrent an exceptional gain/loss item defined or 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.Part III Business Summary
I Principal Activity of the Company in the Reporting Period
In 2020 the central government continued to stabilize land and housing prices as well as market expectations.
Upholding the principle that housing is for living in and not for speculation the central government adhered to the
concept of taking a differential approach in regulating the housing market for different places. The differentiation
among cities and urban regions intensified. To be specific the first-tier cities led the way and the city clusters in
the Pearl River Delta and Yangtze River Delta performed brilliantly. At the same time while maintaining the
continuity consistency and stability of real estate financial policies the central government accelerated the
establishment of a long-term mechanism for real estate finance. In the second half of the year the overall real
estate financial supervision was gradually tightened.The Company primarily develops and sells residential properties in two cities Shenzhen and Shantou. In
Shenzhen the Chuanqi Donghu Mingyuan project saw the completion of construction in late 2019 and has started
the hand-over and move-in process which is cumulatively around 80% sold; and regarding the Cuilinyuan project
it is approximately 95% sold. In Shantou Tianyuewan Phase II was topped out in late June 2020 with the
decoration for its public space almost fully completed; and Tianyuewan Phase I is around 70% sold cumulatively.II Significant Changes in Major Assets
1. Significant Changes in Major Assets
Major assets Main reason for significant changes
Equity assets
The ending amount was down by RMB92349.00 (or 19.66%) from the
beginning amount primarily driven by the share of profits of associates
measured at the equity method.
Fixed assets
The ending amount was down by RMB2482056.68 (or 8.13%) from the
beginning amount primarily driven by the depreciation allowance.Intangible assets No significant change
Construction in progress No significant change
Accounts payable
The ending amount was down by RMB67297864.18 (or 27.56%) from the
beginning amount primarily driven by the payments made for construction.
Advances from customers
The ending amount was down by RMB153542418.28 (or 96.28%) from the
beginning amount primarily driven by the reclassification to contract liabilities
and other current liabilities pursuant to the new accounting standard governing
revenue.Short-term borrowings
The ending amount was up by RMB25246735.77 (or 48.88%) from the
beginning amount primarily driven by the increased borrowings of Shenzhen
Zhentong Engineering Co. Ltd. through discounting and pledging accounts
receivable.Taxes and levies payable
The ending amount was down by RMB125991168.41 (or 21.51%) from the
beginning amount primarily driven by the payment of various taxes.
2. Major Assets Overseas
□ Applicable √ Not applicable
III Core Competitiveness Analysis
As a pioneer of real estate development enterprises in Shenzhen the Company has created a number of "first
places" in the history of real estate development in China. For example the first to use the paid state-owned land
the first to introduce the foreign investment for the cooperative land development the first to raise development
funds by means of pre-sale of buildings the first to carry out public bidding for construction projects in
accordance with international practices the first to set up a property management company to the buildings and
residences developed in an all-rounded manner the first to win the bid in the auction of land use rights held in the
Shenzhen Special Economic Zone etc.Over the past 40 years the company has developed more than 100 high-rise buildings 500 multi-storey residential
buildings and 400 garden villas with a cumulative building area of more than 4 million square meters. It has paid
great efforts to the establishment of a modern enterprise HR management system and works hard in building a
professional and high-quality development team. It also keeps improving the management mechanism and
processes for project development. As a result its planning construction cost control sales ability and brand
image have been effectively improved. More importantly its main business operation ability and core
competitiveness have been greatly enhanced.
In 2020 the company was awarded "Industry-Leading Enterprise and Top 20 Enterprise in terms of
Comprehensive Strength in Shenzhen Real Estate Development Industry" by Shenzhen Real Estate Association
(SREA).
Part IV Operating Performance Discussion and Analysis
I Overview
Since the abrupt occurrence at the beginning of 2020 COVID-19 has continued to spread throughout the whole
world dragging global economy into the most severe recession since the Great Depression. The real estate market
as a whole kept its promise that houses are for living in and not for speculation on. In face of the complex severe
macro-economic situation and fierce market competition the Company’s management team met the challenges
and moved forward under pressure with the support from the controlling shareholders. Taking the pandemic
prevention and business operation into consideration the management team made overall plans leading the
working staff overcame the impact of the pandemic and the adverse effects of the termination of reorganization
and eventually made great achievements. The main achievements in the past year are as follows:
(I) Effective Pandemic Prevention and Control
After the outbreak of COVID-19 the Company took immediate action to establish a leading group for pandemic
prevention and control according to the work deployment of Shenzhen Municipal Party Committee Shenzhen
Municipal Government and Shenzhen State-owned Assets Supervision and Administration Commission fully
implementing measures of the regular pandemic prevention and control and resumption of work and production.
During the Reporting Period no mass infection cases emerged among the working staff and the 27 residential
areas and other commercial properties operated and managed by the property management company and the
Haiyan Hotel. At the same time the Company's headquarters and its subordinated enterprises maintained normal
production and operation throughout the year and realized the well-balanced pandemic prevention and production.(II) Stable Core Business with Improvement
1. Projects were carried forward steadily. Tianyuewan Phase II Project in Shantou was completed in June 2020
including the decoration of the public areas. The road works of Fuxian Road and Xianzhong Road for Chuanqi
Shanglin Project in Shenzhen were completed and opened to traffic in December 2020. The landscaping of
Chuanqi Donghu Mingyuan Project and the civil air-raid shelter have been successfully completed.
2. Sales capacity was enhanced significantly. In Shenzhen the sales area of Chuanqi Donghu Mingyuan and
Cuilinyuan project reached nearly 20000 square meters far exceeding the annual sales goal. In Shantou the
accumulative sales of Tianyuewan Phase I Project reached about 70% of the total. Paying close attention to the
market dynamics the Company adjusted its marketing strategies in a timely manner in addition to innovating the
marketing approaches and thus increased its revenue while reducing the cost remarkably. Also the Company has
taken various measures to ensure the smooth development of online home-purchase contracts and filing. In the
whole year the rate of property repossession in Shenzhen reached nearly 95% and that in Shantou was 91%.(III) Effective Operation and Management
1. The corporate governance was more standardized. In order to clarify the legal status of the party
organization in the corporate governance structure of the Company the Company completed the revision of the
Articles of Association in June 2020 and party building work was officially recorded in it. During the Reporting
Period the chairman of the Board and the chairman of the Supervisory Committee changed their role due to the
expiration of the term. Four non-independent directors two independent directors one supervisor the general
manager a deputy general manager the CFO and the Board Secretary were changed. In May 2020 the Company
implemented the cash dividend again and the cash dividend became normal.
2. Standard and effective financial management. In order to withdraw funds of real estate sales effectively the
Company kept close communication with cooperative banks. Additionally under the premise of ensuring the
operating capital requirements the Company made full use of the idle funds. Attaching great importance to budget
implementation the Company realized the decrease of key monitoring costs by 25% year-on-year.
3. Real estate rental undertook remarkable responsibilities. Under the double impact of COVID-19 and
economic downturn the Company focused on customer needs and tried its best to save increase and tap potential
and the rental income exceeded the annual target. During the Reporting Period in response to the government's
call for the fight against the pandemic the Company bravely undertook its social responsibility reducing or
exempting tenants' rent by more than RMB18 million.
4. Sound achievements were made in cost control. During the Reporting Period 43 budget plans (including the
approval of them) were created and the cumulative reduction rate of budget amount reached 19.64%. In particular
the Company completed the budgeting auditing and contracting of two municipal projects on Fuxian Road and
Xianzhong Road in Longgang Sub-district and the reduction rate of the approved budget reached 23.30%.
5. Work safety became a hot topic. During the Reporting Period the Company established a work safety
supervision leading group to fully ensure the safety production. It also optimized the safety production
management system constantly formulated the special work plans for safety production and investigated and
treated the hidden safety hazards in a timely manner. In order to strengthen the safety awareness of employees the
Company carried out over 500 safety production inspections and organized more than 50 relevant trainings. Zero
safety accident happened throughout the year.(IV) Termination of Major Asset Restructuring
Due to a major asset restructuring in planning the Company's stocks have been suspended for trading since the
opening of the stock market on 14 September 2016. During the suspension period the Company kept close
communication with all trading parties worked hard in due diligence auditing evaluation and other issues and
fulfilled the required decision-making procedures and information disclosure timely. In view of the current market
environment and many other reasons it was still not a good time to advance the major asset restructuring.Therefore in order to effectively protect the interests of the Company and all shareholders the Company decided
to terminate the major asset restructuring after careful consideration. On 9 November 2020 the stock trading
resumed.(V) Strict and Pragmatic Approach in Party Building
The Company persisted in the party's requirements for managing and governing the party strictly and carried out
political development comprehensively. While attaching great importance to party building the Company
promoted corporate culture development in an orderly manner. Firstly the Company carried out the theme
education. The "First Topics" learning became the theme of the Theoretical Center Team routinely. Secondly the
Company deepened the party’s brand building. Through implementing the "1+6" one-core multi-linked
governance mode the Company formed a new pattern of community governance led by the party building
diversified participation integrated and co-governance. Thirdly the Company enhanced the employees’ sense of
social responsibility. The company organized the party members volunteer and mass volunteers to participate in
voluntary activities in Jiabei community. Fourthly the Company strengthened the corporate culture development.The Company organized various activities to enrich the employees’ life and thus enhanced the corporate cohesion
and team spirit.The Company is subject to the Guideline No. 3 of the Shenzhen Stock Exchange on Information Disclosure by
Industry—for Listed Companies Engaging in Real Estate.New additions to the land bank:
Name of
land lot or
project
Location
Planned use
of land
Site area
（㎡）
Floor area
with plot
ratio （㎡）
How the
land is
obtained
The
Company’s
interest
Total land
price
(RMB’000
0)
Considerati
on of the
Company’s
interest
(RMB’000
0)
Cumulative land bank:
Name of project/area Site area（0000 ㎡） Floor area（0000 ㎡）
Floor area available for
development（0000 ㎡）
Xinfeng Building in Shantou 0.59 2.66 2.66
Total 0.59 2.66 2.66
Development status of major projects:
City/re
gion
Name
of
project
Locatio
n
Status
The
Compa
ny’s
interest
Time
for
comme
ncemen
t of
constru
ction
%
develo
ped
%
constru
cted
Site
area
（㎡）
Planne
d floor
area
with
plot
ratio
（㎡）
Floor
area
comple
ted in
the
Current
Period
（㎡）
Cumul
atively
comple
ted
floor
area
（㎡）
Expect
ed total
invest
ment
(RMB’
0000)
Cumul
ative
invest
ment
(RMB’
0000)
Shanto
u
Tianyu
ewan
Phase
II
Chaoya
ng
District
Frame
work in
constru
ction
100.00
%
1
Octobe
r 2018
95% 95.00% 33362
12777
0
65485 49829
Sales status of major projects:
City/reg
ion
Name
of
project
Locatio
n
Status
The
Compan
y’s
interest
Floor
area
with
plot
ratio
（㎡）
Floor
area
availabl
e for
sale
（㎡）
Cumula
tively
pre-sold
/sold
floor
area
（㎡）
Floor
area
pre-sold
/sold in
the
Current
Period
（㎡）
Pre-sale
/sales
revenue
generate
in the
Current
Period
(RMB’0
000)
Cumula
tively
settled
floor
area
(㎡)
Floor
area
settled
in the
Current
Period
（㎡）
Pre-sale
/sales
revenue
settled
in the
Current
Period
(RMB’0
000)
Shenzhe
n
Cuiliny
uan
Longga
ng
District
Ready
for sale
100.00
%
60111 56137 52020 1326 4548 51911 3484 11540
Shenzhe
n
Chuanqi
Donghu
Mingyu
an
Luohu
District
Ready
for sale
100.00
%
55727 32857 26169 18647 123429 18866 14116 86001
Shantou
Tianyue
wan
Phase I
Chaoya
ng
District
Ready
for sale
100.00
%
153470 160372 99496 30298 15776 76993 34040 17900
Shantou
Tianyue
wan
Phase II
Chaoya
ng
District
On
pre-sale
100.00
%
127770 137059 1235 1235 746
Rental status of major projects:
Name of project Location Use
The Company’s
interest
Rentable area
（㎡）
Cumulative
rented area
（㎡）
Average
occupancy rate
Real Estate
Mansion
Shenzhen Commercial
100.00% 3413.88 3413.88 100.00%
North Block of
Guoshang
Mansion
Shenzhen Commercial
100.00% 4819.71 4819.71 100.00%
Petrel Building Shenzhen Commercial 100.00% 22475.47 22475.47 100.00%
SPG Plaza Shenzhen Office building 100.00% 61005.82 37088.88 60.80%
SPG Plaza
Podium
Shenzhen Commercial
100.00% 19896.3 10327.14 51.90%
Wenjin Garden Shenzhen Commercial 100.00% 3531.60 3531.60 100.00%
Primary land development:
□ Applicable √ Not applicable
Financing channels:
Financing channel
Ending balance of
financings
Financing cost
range/average
financing cost
Maturity structure
Within 1 year 1-2 years 2-3 years Over 3 years
Development strategy and operating plan for the coming year:
Please refer to “IX Prospects” in this part.Provision of guarantees for homebuyers on bank mortgages:
√ Applicable □ Not applicable
As at 31 December 2020 the Group provided guarantees for the homebuyers of the following projects on their bank
mortgages:
Project Guarantee period
Guarantee amount
(RMB’0000)
Note
Cuilinyuan Until the property ownership certificate is
registered as collateral and handed over to
bank for keeping
8532.86
Chuanqi Donghu
Mingyuan
Until the property ownership certificate is
registered as collateral and handed over to
bank for keeping
6056.20
Tianyuewan
Phase I
Until the property ownership certificate is
registered as collateral and handed over to
bank for keeping
22546.73
Total 37135.79
Joint investments by directors supervisors and senior management and the listed company (applicable for such
investments where the directors supervisors and senior management are the major source of investment):
□ Applicable √ Not applicable
II Core Business Analysis
1. Overview
See “I Overview” above.
2. Revenue and Cost Analysis
(1) Breakdown of Operating Revenue
Unit: RMB
2020 2019
Change (%)
Operating revenue
As % of total
operating revenue
(%)
Operating revenue
As % of total
operating revenue
(%)
Total 1615009713.88 100% 2548740319.49 100% -36.63%
By operating division
Property sales 1158411393.81 71.73% 2017872864.14 79.17% -42.59%
Engineering and
construction
251454463.43 15.57% 304837313.46 11.96% -17.51%
Property
management
151968675.51 9.41% 157665638.01 6.19% -3.61%
Rental service 63254584.48 3.92% 86484133.79 3.39% -26.86%
Other 12215550.30 0.76% 15337469.10 0.60% -20.35%
Eliminated internal
transactions and
accounts
-22294953.65 -1.38% -33457099.01 -1.31% -33.36%
By product category
Residential units 1157620917.61 71.68% 719499453.23 28.23% 60.89%
Shops and parking
lots
790476.20 0.05% 11526595.29 0.45% -93.14%
Apartments 0.00 0.00% 1286846815.62 50.49% -100.00%
Other 478893273.72 29.65% 564324554.36 22.14% -15.14%
Eliminated internal
transactions and
accounts
-22294953.65 -1.38% -33457099.01 -1.31% -33.36%
By operating segment
Guangdong
Province
1613933749.67 99.93% 2491373238.76 97.75% -35.22%
Other regions in
China
22531905.61 1.40% 90235417.77 3.54% -75.03%
Overseas 839012.25 0.05% 588761.97 0.02% 42.50%
Eliminated internal
transactions and
-22294953.65 -1.38% -33457099.01 -1.31% -33.36%
accounts
(2) Operating Division Product Category or Operating Segment Contributing over 10% of Operating
Revenue or Operating Profit
√ Applicable □ Not applicable
Unit: RMB
Operating
revenue
Cost of sales
Gross profit
margin
YoY change in
operating
revenue (%)
YoY change in
cost of sales
(%)
YoY change in
gross profit
margin (%)
By operating division
Property sales
1158411393.8
1
387659747.71 66.54% -42.59% -22.05% -8.82%
Engineering
and
construction
251454463.43 244511214.58 2.76% -17.51% -18.04% 0.62%
By product category
Residential
units
1157620917.6
1
387369116.92 66.54% 60.89% 44.37% 3.83%
Shops and
parking lots
790476.20 290630.79 63.23% -93.14% -93.21% 0.38%
Apartments 0.00 0.00 0.00% -100.00% -100.00% -82.54%
By operating segment
Guangdong
Province
1613933749.6
7
799028972.30 50.49% -35.22% -12.14% -12.96%
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 2020 2019 Change (%)
Property sales
Sales volume RMB’0000 38767 53222 -27.16%
Output RMB’0000 15616 38575 -59.52%
Inventory RMB’0000 121599 161109 -24.52%
Any over 30% YoY movements in the data above and why:
√ Applicable □ Not applicable
Real estate projects under development decreased.
(4) Execution Progress of Major Signed Sales Contracts in the Reporting Period
□ Applicable √ Not applicable
(5) Breakdown of Cost of Sales
By operating division
Unit: RMB
Operating
division
Item
2020 2019
Change (%)
Cost of sales
As % of total
cost of sales
(%)
Cost of sales
As % of total
cost of sales
(%)
Property sales 387659747.71 48.13% 497310023.38 51.92% -22.05%
Engineering
and
construction
244511214.58 30.35% 298315846.77 31.15% -18.04%
Property
management
139937487.12 17.37% 142261602.88 14.85% -1.63%
Rental service 35984852.34 4.47% 45173891.05 4.72% -20.34%
Other 11611768.12 1.44% 13404895.03 1.40% -13.38%
Eliminated
internal
transactions and
accounts
-14196621.19 -1.76% -38713606.57 -4.04% -63.33%
Total 805508448.68 100.00% 957752652.54 100.00% -15.90%
Note:
The operating divisions as percentages of the total cost of sales are stable with insignificant changes on a year-on-year
basis.
(6) Changes in the Scope of Consolidated Financial Statements for the Reporting Period
□ Yes √ No
(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) 105366757.84
Total sales to top five customers as % of total sales
of the Reporting Period (%)
6.52%
Total sales to related parties among top five
customers as % of total sales of the Reporting
Period (%)
0.00%
Information about top five customers:
No. Customer Sales revenue contributed As % of total sales revenue (%)
for the Reporting Period
(RMB)
1 Legal person A 41660432.53 2.58%
2 Legal person B 30587155.87 1.89%
3 Legal person C 17880165.06 1.11%
4 Legal person D 7963269.65 0.49%
5 Legal person E 7275734.73 0.45%
Total -- 105366757.84 6.52%
Other information about major customers:
□ Applicable √ Not applicable
Major suppliers:
Total purchases from top five suppliers (RMB) 285468647.66
Total purchases from top five suppliers as % of total
purchases of the Reporting Period (%)
66.78%
Total purchases from related parties among top five
suppliers as % of total purchases of the Reporting
Period (%)
42.81%
Information about top five suppliers:
No. Supplier
Purchase in the Reporting
Period (RMB)
As % of total purchases (%)
1 Legal person A 182994620.79 42.81%
2 Legal person B 41003278.66 9.59%
3 Legal person C 30099448.05 7.04%
4 Legal person D 17616816.55 4.12%
5 Legal person E 13754483.61 3.22%
Total -- 285468647.66 66.78%
Other information about major suppliers:
□ Applicable √ Not applicable
3. Expense
Unit: RMB
2020 2019 Change (%) Reason for any significant change
Selling expense 55989397.22 79480254.02 -29.56%
Sales were limited for a certain
period of time due to the pandemic.
Administrative
expense
93616226.75 68854618.70 35.96%
As projects were completed the
relevant engineering construction
and labor costs were expensed.
Finance costs -21505685.05 -20906149.20 -2.87%
4. R&D Investments
□ Applicable √ Not applicable
5. Cash Flows
Unit: RMB
Item 2020 2019 Change (%)
Subtotal of cash generated
from operating activities
1783707997.05 2728276550.05 -34.62%
Subtotal of cash used in
operating activities
1498543983.88 2124668825.30 -29.47%
Net cash generated from/used
in operating activities
285164013.17 603607724.75 -52.76%
Subtotal of cash generated
from investing activities
1019824221.85 2237622620.55 -54.42%
Subtotal of cash used in
investing activities
749215.31 2321918490.62 -99.97%
Net cash generated from/used
in investing activities
1019075006.54 -84295870.07 -1308.93%
Subtotal of cash generated
from financing activities
76893995.94 43741293.64 75.79%
Subtotal of cash used in
financing activities
218571160.17 204370642.51 6.95%
Net cash generated from/used
in financing activities
-141677164.23 -160629348.87 11.80%
Net increase in cash and cash
equivalents
1161914166.47 358667324.42 223.95%
Explanation of why any of the data above varies significantly:
√ Applicable □ Not applicable
Cash generated from and used in operating activities both decreased year-on-year primarily because property sales and
development both decreased.
Cash generated from and used in investing activities both decreased year-on-year primarily driven by a decrease in the
acquisition of wealth management products.Net increase in cash and cash equivalents increased year-on-year primarily driven by the disinvestment in structured
deposits upon maturity.Reason for any big difference between the net operating cash flow and the net profit for this Reporting Period
□ Applicable √ Not applicable
III Analysis of Non-Core Businesses
□ Applicable √ Not applicable
IV Analysis of Assets and Liabilities
1. Significant Changes in Asset Composition
Indicate whether the Company has adopted the new accounting standards governing revenue and leases since 2020 and
restated the beginning amounts of relevant financial statement line items in the year.
Applicable.
Unit: RMB
31 December 2020 1 January 2020 Change in
percentage
(%)
Reason for any
significant change Amount
As a % of total
assets
Amount
As a % of total
assets
Monetary
assets
2687465070.0
1
54.44%
2511140445.3
5
51.15% 3.29% Settlement of sales
Accounts
receivable
59590944.06 1.21% 62059055.68 1.26% -0.05%
Inventories
1220464112.5
6
24.72%
1462229048.1
8
29.78% -5.06%
Sales and decrease in
real estate projects
Investment
property
616365621.53 12.48% 632241900.20 12.88% -0.40%
Long-term
equity
investments
377489.65 0.01% 469838.65 0.01% 0.00%
Fixed assets 28039978.43 0.57% 30522035.11 0.62% -0.05%
Short-term
borrowings
76893995.94 1.56% 51647260.17 1.05% 0.51%
2. Assets and Liabilities at Fair Value
√ Applicable □ Not applicable
Unit: RMB
Item
Beginning
amount
Gain/loss on
fair-value
changes in
the
Reporting
Period
Cumulative
fair-value
changes
charged to
equity
Impairment
allowance
for the
Reporting
Period
Purchased in
the
Reporting
Period
Sold in the
Reporting
Period
Other
changes
Ending
amount
Financial
assets
Investments
in other
equity
instruments
33126730.
04
4384130.4
7
37510860
.51
Subtotal of
financial
33126730.
04
4384130.4
7
37510860
.51
assets
Total of the
above
33126730.
04
4384130.4
7
37510860
.51
Financial
liabilities
0.00 0.00
Other change
Significant changes to the measurement attributes of the major assets in the Reporting Period:
□ Yes √ No
3. Restricted Asset Rights as at the Period-End
Assets to which the Company’s ownership or right of use was restricted:
Item Ending carrying value Reasons for restriction
Accounts receivable
49686095.76 Put in pledge for short-term
borrowings
Notes receivable 30068561.31 Undue endorsed or discounted trade
acceptance notes
Total 79754657.07
V Investments Made
1. Total Investment Amount
□ Applicable √ Not applicable
2. Major Equity Investments Made in the Reporting Period
□ Applicable √ Not applicable
3. Major Non-Equity Investments Ongoing in the Reporting Period
□ Applicable √ Not applicable
4. Financial Investments
(1) Securities Investments
□ Applicable √ Not applicable
No such cases in the Reporting Period.
(2) Investments in Derivative Financial Instruments
□ Applicable √ Not applicable
No such cases in the Reporting Period.5. Use of Funds Raised
□ Applicable √ Not applicable
No such cases in the Reporting Period.VI 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
VII 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
Name
Relationsh
ip with the
Company
Principal
activity
Registered
capital
Total assets Net assets
Operating
revenue
Operating
profit
Net profit
Shenzhen
SPG
Longgang
Developme
nt Co. Ltd.
Subsidiary
Real estate
development
30000000.00
39192544
1.93
11450813
6.12
11693425
3.32
44837691.
98
28784548.
48
Shantou
SEZ
Wellam
FTY
Building
Developme
nt Co. Ltd.
Subsidiary
Real estate
development
91226120.44
19364007
0.89
12239074
6.58
4715303.3
6
1519810.5
1
-2215913.
28
Shantou
Huafeng
Real Estate
Developme
nt Co. Ltd.
Subsidiary
Real estate
development
80000000.00
97789821
1.50
20641603.
93
17900482
9.03
410646.55 -672511.21
Great Wall
Estate Co.
Subsidiary
Real estate
development
2051146.00
18163906.
02
-83658196
.85
839012.25 -774074.99 -774074.99
Inc. (U.S.)
Shenzhen
Zhentong
Engineering
Co. Ltd.
Subsidiary
Installation
and
maintenance
10000000.00
14818752
5.32
24609352.
65
25271248
2.88
636053.15 323798.26
Shenzhen
Property
Managemen
t Co. Ltd.
Subsidiary
Property
management
7250000.00
10360521
7.56
31817548.
93
15154632
3.15
5371989.5
1
3798588.6
4
Shenzhen
Petrel Hotel
Co. Ltd.
Subsidiary Hotel service 30000000.00
52342468.
40
42149488.
13
14314081.
68
-5361133.
28
-4071603.
65
Shenzhen
Huazhan
Constructio
n
Supervision
Co. Ltd.
Subsidiary Supervisor 8000000.00
10525484.
45
9936185.3
4
3308507.7
5
380114.01 523887.40
Xin Feng
Enterprise
Co. Ltd.
Subsidiary
Investment
and
management
502335.00
41727401
0.65
-13253443
6.59
6632667.6
0
6632667.6
0
Subsidiaries obtained or disposed in the Reporting Period:
□ Applicable √ Not applicable
Information about major majority- and minority-owned subsidiaries:
1. Except the Company the subordinate subsidiaries engaged in real estate development mainly include:
Shenzhen SPG Longgang Development Co. Ltd. Shantou SEZ Wellam FTY Building Development Co. Ltd.Shantou Huafeng Real Estate Development Co. Ltd. The Cuilinyuan project developed by Shenzhen SPG
Longgang Development Co. Ltd. brought forward RMB115 million in 2020 (the percentage of accumulative
sales carried forward was 93%) accounting for 10% of the Company's real estate sector income 7.15% of the
Company's operating revenue and 11% of the group's combined profits. 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 2017. The Phase II started construction in November 2018 and was completed
at the end of 2019. As of 2020 the sales progress of the Phase I was relatively slow with an accumulated sales rate
of about 62%.
2. Shenzhen Zhentong Engineering Co. Ltd. was engaged in the business of building installation and maintenance
with the 2020 operating revenues of RMB253 million and of 15.65% to the operating revenues of the Company.
3. Shenzhen Property Management Co. Ltd was engaged in the industry of property management and the
business was steady. The 2020 operating revenues was of RMB152 million that was of 9.38% to the operating
revenues of the Company.
4. The 2020 net profits of Xin Feng Enterprise Co. Ltd. was of RMB6.63 million which mainly due to the
changes of exchange rate and it conducts no business.5. The 2020 net profits of Shenzhen Petrel Hotel Co. Ltd. was of RMB-4.07 million which mainly due to the
epidemic.VIII Structured Bodies Controlled by the Company
□ Applicable √ Not applicable
IX Prospects
(I) Industrial Pattern and Trend
Upholding the principles that houses are for living and not for speculation on the Company fully implemented a
long-term management and regulation mechanism through taking a differential approach in different places
stabilizing the land prices the housing prices and the expectations to ensure sound development of the real estate
market. Under the continuous control of multiple financial regulatory policies development goals of real estate
enterprises were shifted from growth of scale to growth of quality. The top enterprises with high qualities as a
result were easy to get more resources and the industry concentration was further improved.
(2) Development Strategies of the Company
The Company will earnestly implement the instructions of the Fifth Plenary Session of the 19
th
Central Committee
of the Communist Party of China the Central Economic Work Conference Secretary General Xi Jinping’s speech
at the 40
th
Anniversary of the Establishment of the Shenzhen Special Economic Zone and the important speeches
during his visits to Guangdong. Embracing the strategic opportunities of Shenzhen “Dual Zone” construction and
the reform of state-owned assets and enterprises the Company will take actions according to the decisions of the
Municipal Party Committee and Municipal Government the Municipal State-owned Assets Supervision and
Administration Commission and the Shenzhen Investment Holdings Co. Ltd. moving forward steadily and
bravely and plotting out the project reserves. While stabilizing operation and management the Company
assiduously innovated profit models and explored new areas so as to further improve the quality of the Company.Taking into account the overall situation the Company are in full confidence to win the battle in the first year of
the "14
th
Five-Year Plan" and make SPG a respected listed company.
(III) Potential Risks
1. Macroeconomic risks. In 2021 the world economic situation remains complicated and severe. Since the
recovery is precarious the various derivative risks caused by the impact of the pandemic cannot be ignored.2. Industrial regulation risks. The government revealed many policies in terms of real estate market such as“houses are for living in not for speculation on" encouraging house renting and purchasing taking differentapproaching in different cities etc. The Company will meet huge challenges in future.
3. Business operation risks. Since the reserves of existing development land resource are limited the competition
in the open land market will become quite intense in the future which accordingly will endanger the Company's
sustainable development.
4. The risk of brain drain. The restructuring has been suspended for many years resulting in the loss of the
professional technical talents and key managers. At the same time the unfavorable talent structure and
professional capabilities need further improvement.(IV) Operation Plan
In 2021 the Company made an overall operation plan. The Company will stabilize the operation on the basis of
safety management expand the projects while strengthening the implementation. At the same time the Company
will make efforts in key tasks such as project developments and constructions sales asset management and
internal control. Additionally the Company will explore new growth areas vigorously gather all the possible
efforts and accomplish more achievements in the reform and development of the company.
1. Focus on the stable operations. The Company will push forward the construction of projects in progress
check the schedules and guarantee the quality and safety of the projects. Besides the Company will put more
efforts in project marketing campaign to ensure the smooth completion of the annual sales target. Furthermore
great attention will be paid to lease of property to achieve an effective increase in occupancy rate.
2. Forge ahead bravely exploring areas of growth. The Company will increase new lands and projects through
acquisitions cooperative development open market "bidding auction and listing" and other ways. Exploring new
growth areas proactively the Company will strive to reshape a new pattern of profit growth and eventually
improve the quality.
3. Pay constant attention to the prevention and control of pandemic and safe production. The Company will
undertake full responsibility in pandemic prevention and control normalizing its publicity and education.Optimizing the safety production management system will also be put on agenda. Boosting the standardization of
safety production and "dual" prevention mechanism the Company plans to identify and eliminate the potential
risks and intensify the safety management in important areas to ensure the smooth progress of production and
operation.X Communications with the Investment Community such as Researches Inquiries and
Interviews
1. During the Reporting Period
√ Applicable □ Not applicable
Date of visit
Place of
visit
Way of visit Type of visitor Visitor
Contents and materials
provided
Index to
main
inquiry
information
2020-01-13
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and the sales of project
development and didn’t
offer written materials
N/A
2020-01-22
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and fundamentals of the
Company and didn’t
offer written materials
N/A
2020-03-02
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and annual operation
and expected disclosure
time of annual report
and didn’t offer written
materials
N/A
2020-03-05
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and share trading
resumption time of the
Company and didn’t
offer written materials
N/A
2020-03-16
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and share trading
resumption time of the
Company and didn’t
offer written materials
N/A
2020-03-19
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and fundamentals of the
Company and didn’t
offer written materials
N/A
2020-03-26
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and plan arrangement of
the Company and
didn’t offer written
materials
N/A
2020-03-31
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and reasons for the long
suspension of trading
and share trading
resumption time of the
N/A
Company and didn’t
offer written materials
2020-04-10
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and the expected time
for stock trading
resumption and didn’t
offer written materials
N/A
2020-04-29
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and the expected time
for stock trading
resumption and didn’t
offer written materials
N/A
2020-05-08
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and the expected time
for stock trading
resumption and didn’t
offer written materials
N/A
2020-05-13
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and the expected time
for stock trading
resumption and didn’t
offer written materials
N/A
2020-05-28
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and the expected time
for stock trading
resumption and didn’t
offer written materials
N/A
2020-06-03
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and the impact of the
40th anniversary of the
establishment of the
Shenzhen Special
Economic Zone and
didn’t offer written
materials
N/A
2020-06-15
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and the expected time
for stock trading
resumption and didn’t
offer written materials
N/A
2020-06-29
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and business situation
and expected disclosure
time of interim report
and didn’t offer written
materials
N/A
2020-07-01
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and the expected time
for stock trading
resumption and didn’t
offer written materials
N/A
2020-07-02
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and didn’t offer written
materials
N/A
2020-07-06
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and reasons for the long
suspension of trading
and share trading
resumption time of the
Company and didn’t
offer written materials
N/A
2020-07-09
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and expected disclosure
time of third quarter
report and didn’t offer
written materials
N/A
2020-07-15
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and the expected time
for stock trading
resumption and didn’t
offer written materials
N/A
2020-07-23
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
the project development
and business condition
of the Company and
annual operations
without written
materials and didn’t
offer written materials
N/A
2020-08-06
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and fundamentals of the
Company and didn’t
offer written materials
N/A
2020-08-12
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and the expected time
for stock trading
resumption and didn’t
offer written materials
N/A
2020-08-18
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and plan arrangement of
the Company and
didn’t offer written
materials
N/A
2020-08-26
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and the expected time
for stock trading
resumption and didn’t
offer written materials
N/A
2020-09-07
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and fundamentals of the
N/A
Company and didn’t
offer written materials
2020-09-11
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and didn’t offer written
materials
N/A
2020-09-14
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and the expected time
for stock trading
resumption and didn’t
offer written materials
N/A
2020-09-15
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring of
the Company and
expected disclosure
time of third quarter
report and didn’t offer
written materials
N/A
2020-09-21
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and reasons for the long
suspension of trading of
the Company and
didn’t offer written
materials
N/A
2020-09-22
The
Company
In writing Individual
Individual
investor
Inquired of the progress
of assets restructuring
and the expected time
for stock trading
resumption and didn’t
offer written materials
N/A
2020-09-24
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and plan arrangement of
the Company and its
business conditions in
the third quarter and
didn’t offer written
materials
N/A
2020-09-25
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and reasons for the long
suspension of trading of
the Company and
didn’t offer written
materials
N/A
2020-09-28
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and the expected time
for stock trading
resumption and didn’t
offer written materials
N/A
2020-09-30
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and reasons for the long
suspension of trading of
the Company and
didn’t offer written
materials
N/A
2020-10-13
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and fundamentals of the
Company and didn’t
offer written materials
N/A
2020-10-14
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and the expected time
for stock trading
resumption and didn’t
offer written materials
N/A
2020-10-16
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and project
development and sales
and operation of the
Company and didn’t
offer written materials
N/A
2020-10-19
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and fundamentals of the
Company and didn’t
offer written materials
N/A
2020-10-20
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and reasons for the long
suspension of trading of
the Company and
didn’t offer written
materials
N/A
2020-10-22
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and fundamentals of the
Company and didn’t
offer written materials
N/A
2020-10-26
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and reasons for the long
suspension of trading of
the Company and
didn’t offer written
materials
N/A
2020-10-28
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and the expected time
for stock trading
resumption and didn’t
offer written materials
N/A
2020-10-29
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and fundamentals of the
Company and didn’t
offer written materials
N/A
2020-10-30
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and the expected time
for stock trading
resumption and didn’t
offer written materials
N/A
2020-11-02
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and project
development and sales
and operation of the
Company and didn’t
offer written materials
N/A
2020-11-03
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and reasons for the long
suspension of trading of
the Company and
didn’t offer written
materials
N/A
2020-11-04
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and the expected time
for stock trading
resumption and didn’t
offer written materials
N/A
2020-11-05
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and project
development and sales
and operation of the
Company and didn’t
offer written materials
N/A
2020-11-06
The
Company
By telephone Individual
Individual
investor
Inquired of the progress
of assets restructuring
and the expected time
for stock trading
resumption and didn’t
offer written materials
N/A
2020-11-09
The
Company
By telephone Individual
Individual
investor
Inquired of the reasons
for the terminations of
asset restructuring and
didn’t offer written
materials
N/A
2020-11-10
The
Company
By telephone Individual
Individual
investor
Inquired of the future
development plan of the
Company and didn’t
offer written materials
N/A
2020-11-11
The
Company
By telephone Individual
Individual
investor
Inquired of business
situations of the
Company and did not
offer written materials
N/A
2020-11-12
The
Company
By telephone Individual
Individual
investor
Inquired of the reasons
for the terminations of
asset restructuring and
didn’t offer written
materials
N/A
2020-11-13
The
Company
By telephone Individual
Individual
investor
Inquired of the land
reserves and projects
progress of the
Company and didn’t
offer written materials
N/A
2020-11-16
The
Company
By telephone Individual
Individual
investor
Inquired of the reasons
for the terminations of
asset restructuring and
didn’t offer written
N/A
materials
2020-11-17
The
Company
By telephone Individual
Individual
investor
Inquired of the future
development plan of the
Company and didn’t
offer written materials
N/A
2020-11-19
The
Company
By telephone Individual
Individual
investor
Inquired of business
situations and strategic
planning of the
Company and didn’t
offer written materials
N/A
2020-11-24
The
Company
By telephone Individual
Individual
investor
Inquired of the land
reserves and projects
progress of the
Company and didn’t
offer written materials
N/A
2020-11-26
The
Company
By telephone Individual
Individual
investor
Inquired of the future
development plan of the
Company and didn’t
offer written materials
N/A
2020-11-30
The
Company
By telephone Individual
Individual
investor
Inquired of the land
reserves and projects
progress of the
Company and didn’t
offer written materials
N/A
2020-12-04
The
Company
By telephone Individual
Individual
investor
Inquired of business
situations and strategic
planning of the
Company and didn’t
offer written materials
N/A
2020-12-09
The
Company
By telephone Individual
Individual
investor
Inquired of business
situation and didn’t
offer written materials
N/A
2020-12-21
The
Company
By telephone Individual
Individual
investor
Inquired of project sales
of the Company and
didn’t offer written
materials
N/A
2020-12-28
The
Company
By telephone Individual
Individual
investor
Inquired of the future
development plan of the
Company and didn’t
offer written materials
N/A
Times of communications 66
Number of institutions communicated with 0
Number of individuals communicated with 66
Number of other communication parties 0
Tip-offs or leakages of substantial
supposedly-confidential information during
communications
None
Part V Significant Events
I Profit Distributions to Ordinary Shareholders (in the Form of Cash and/or Stock)
How the profit distribution policy especially the cash dividend policy for ordinary shareholders was formulated
executed or revised in the Reporting Period:
□ Applicable √ Not applicable
The profit distributions to ordinary shareholders either in the form of cash or stock in the past three years (including
the Reporting Period) are summarized as follows:
The profit distribution strictly observe regulations of the Articles of Association and the specific cash dividend
plan is worked out after the approval of the board meeting and general meeting. Independent directors played their
roles with due diligence.
For 2018 based on the total 1011660000 shares of the Company as at 31 December 2018 a cash dividend of
RMB2.00 (tax included) was 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.
For 2019 based on the total 1011660000 shares of the Company as at 31 December 2019 a cash dividend of
RMB1.65 (tax included) was 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.
For 2020 based on the total 1011660000 shares of the Company as at 31 December 2020 a cash dividend of
RMB0.87 (tax included) was 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.
Cash dividend for ordinary shareholders in the past three years (including the Reporting Period):
Unit: RMB
Year
Cash
dividends
(tax
inclusive)
(A)
Net profit
attributable
to ordinary
shareholders
of the listed
company in
consolidated
statements
for the year
(B)
A as % of B
(%)
Cash
dividends in
other forms
(such as share
repurchase)
(C)
C as % of B
(%)
Total cash
dividends
(including
those in other
forms) (D)
D as % of B
(%)
2020
88014420.0
0
290229772.
23
30.33% 0.00 0.00%
88014420.0
0
30.33%
2019
166923900.
00
552452307.
59
30.22% 0.00 0.00%
166923900.
00
30.22%
2018
202332000.
00
503498831.
60
40.19% 0.00 0.00%
202332000.
00
40.19%
Indicate by tick mark whether the Company fails to put forward a cash dividend proposal for the ordinary 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 the ordinary shareholders are positive.□ Applicable √ Not applicable
II 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) 0.87
Total shares as the basis for the profit distribution
proposal (share)
1011660000
Cash dividends (RMB) (tax inclusive) 88014420.00
Cash dividends in other forms (such as share
repurchase) (RMB)
0.00
Total cash dividends (including those in other forms)
(RMB)
88014420.00
Distributable profit (RMB) 1360786232.53
Total cash dividends (including those in other forms) as
% of total profit distribution
100%
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 2020 was reviewed and approved by the 60
th
Meeting of the 7
th
Board of Directors held
on 19 March 2021 and intended to be submitted to The 2020 Annual General Meeting for review. Based on the total
1011660000 shares of the Company as at 31 December 2020 a cash dividend of RMB0.87 (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.III Fulfillment of Commitments
1. Commitments of the Company’s Actual 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
Commitment Promisor
Type of
commitm
ent
Details of commitment
Date of
commitm
ent
making
Term of
commitm
ent
Fulfillmen
t
Commitments made in time of
asset restructuring
The
Company
Asset
restructur
ing
The Company's major asset
restructuring was terminated
and trading of the stocks was
resumed on 9 November 2020.The Company promises that it
9
Novembe
r 2020
Two
months
Complete
d
will not initiate the major asset
restructuring after the
announcement of termination
was disclosed within at least
two months.
Fulfilled on time Yes
Specific reasons for failing to
fulfill commitments on time
and plans for next step (if
any)
N/A
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
IV 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.
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 and Methods
√ Applicable □ Not applicable
Please refer to “31. Changes in Main Accounting Policies and Estimates” of “III Main Accounting Policies and
Estimates” in “Part XII Financial Statements” for details.VII Retrospective Restatements due to Correction of Material Accounting Errors in the
Reporting Period
□ Applicable √ Not applicable
No such cases in the Reporting Period.VIII YoY Changes to the Scope of the Consolidated Financial Statements
□ Applicable √ Not applicable
No such cases in the Reporting Period.IX 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 (RMB’0000)
53
How many consecutive years the domestic independent
auditor has provided audit service for the Company
2
Names of the certified public accountants from the
domestic independent auditor writing signatures on the
auditor’s report
Zhao Juanjuan Jiang Xiaoming
How many consecutive years the certified public
accountants from the domestic independent auditor have
provided audit service for the Company
2
Indicate by tick mark whether the independent auditor was changed for the Reporting Period.□ Yes √ No
Independent auditor financial advisor or sponsor engaged for the audit of internal controls:
√ Applicable □ Not applicable
The Company hired Grant Thornton China (LLP) to provide internal control audit service for this Reporting Period at
the cost of RMB0.23 million.X Possibility of Listing Suspension or Termination after Disclosure of this Report
□ Applicable √ Not applicable
XI Insolvency and Reorganization
□ Applicable √ Not applicable
No such cases in the Reporting Period.XII Major Legal Matters
√Applicable □ Not applicable
General
informatio
n
Involved
amount
(RMB’0
000)
Provision Progress Decisions and effects
Execution of
decisions
Disclosur
e date
Index to
disclosed
information
Xi’an
Project
Lawsuit
2100 No
In
execution
? Xi’an Business Tourism
Company Limited (hereinafterreferred to as “Business
Company”) had to pay for the
compensation RMB36.62
million and the relevant interest
(from 14 September 1998 to the
Shaanxi High
People’s Court
Sold all assets of
Business
Company by
auction in
accordance with
19
August
2020
Interim
Report 2020
(full text)
on
www.cninfo.com.cn
payment day) to Xi’an Fresh
Peak Company within one
month after the judgment
entering into force. If the
Business Company failed to pay
in time it had to pay double
debt interests to Xi’an Fresh
Peak Company for the overdue
period; ② Xi’an Joint
Commission on Commerce had
jointly and severally obligation
of the interests of the
compensation; .③ Business
Company shall bear
RMB227500 of the acceptance
fee and the security fee.laws in 2004.The applicant
has received
RMB15.20
million. Now
Business
Company has no
executable
properties and
Xi’an Joint
Commission on
Commerce has
been refusing to
execute the
ruling. It is
difficult to
recover the rest.XIII Punishments and Rectifications
□ Applicable √ Not applicable
No such cases in the Reporting Period.XIV Credit Quality of the Company as well as Its Controlling Shareholder and Actual
Controller
□ Applicable √ Not applicable
XV Equity Incentive Plans Employee Stock Ownership Plans or Other Incentive Measures
for Employees
□ Applicable √ Not applicable
No such cases in the Reporting Period.XVI Major Related-Party Transactions
1. Continuing Related-Party Transactions
√Applicable □ Not applicable
Related
party
Relatio
nship
with
the
Compa
Type
of
transac
tion
Specifi
c
transact
ion
Pricing
principl
e
Transa
ction
price
Total
value
(RMB’
0000)
As %
of total
value
of all
same-t
Approv
ed
transac
tion
line
Over
the
approv
ed line
or not
Metho
d of
settlem
ent
Obtain
able
market
price
for
Disclos
ure
date
Index
to
disclos
ed
inform
ny ype
transac
tions
(RMB’
0000)
same-t
ype
transac
tions
ation
Shenzhe
n Jianan
(Group)
Co. Ltd.
Control
led by
the
same
compa
ny as
the
parent
Engine
ering
constru
ction
Wholly
-owned
subsidi
ary
underto
ok
enginee
ring
constru
ction of
related
party
Negoti
ate
through
agreem
ents
- 725.82 2.89% 725.82 Not
Bank
transfer
-
14
March
2020
2019
Annual
Report
disclos
ed on
www.c
ninfo.c
om.cn
Shenzhe
n Jianan
(Group)
Co. Ltd.
Control
led by
the
same
compa
ny as
the
parent
Engine
ering
constru
ction
Wholly
-owned
subsidi
ary
paid
total
account
for
constru
ction
contract
ed to
related
party
Negoti
ate
through
agreem
ents
-
18299.
46
42.81%
18299.
46
Not
Bank
transfer
-
14
March
2020
2019
Annual
Report
disclos
ed on
www.c
ninfo.c
om.cn
Total -- --
19025.
28
--
19025.
28
-- -- -- -- --
Large-amount sales return in detail N/A
Give the actual situation in the Reporting Period (if any) where an
estimate had been made for the total value of continuing
related-party transactions by type to occur in the Reporting Period
N/A
Reason for any significant difference between the transaction
price and the market reference price (if applicable)
N/A
2. Related-Party Transactions Regarding Purchase or Sales of Assets or Equity Interests
□ Applicable √ Not applicable
No such cases in the Reporting Period.3. Related Transactions Regarding Joint Investments in Third Parties
□ Applicable √ Not applicable
No such cases in the Reporting Period.
4. Credits and Liabilities with Related Parties
□ Applicable √ Not applicable
No such cases in the Reporting Period.
5. Other Major Related-Party Transactions
□ Applicable √ Not applicable
No such cases in the Reporting Period.XVII 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
Type Capital resources Amount incurred Outstanding balance
Overdue unrevoked
amount
Bank financial
products
Self-owned funds 100000 0 0
Total 100000 0 0
High-risk entrusted wealth management with significant single amount or low security poor liquidity and no capital
preservation:
□ 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. Significant Continuing Contracts
□ Applicable √ Not applicable
5. Other Major Contracts
□ Applicable √ Not applicable
No such cases in the Reporting Period.XVIII Corporate Social Responsibility (CSR)
1. Measures Taken to Fulfill CSR Commitment
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 positively and treated the suppliers customers and consumers with
integrity. Participating in the public welfare undertakings such as environment protection and community
activities positively the Company took efforts in keeping a harmonious development of the Company itself and
the whole society. During the Reporting Period the Company actively fought against the pandemic which fully
demonstrated the responsibility of state-owned enterprises. Also the Company donated RMB500000 to the
“Municipal State-owned Enterprise Aiding Hubei Special Fund Raising Action” exempted and reduced rents for
tenants for about RMB18.36 million. Besides in accordance with the idea of “creating a civilized community” in
Jiabei Community the Company organized road traffic civilization persuasion and "creating a civilized
community" voluntary activities twice with the participation of a total of 215 party members and mass volunteers.
During this process the employees' sense of social responsibility was hugely enhanced.
2. Measures Taken for Targeted Poverty Alleviation
The Company conducted no targeted poverty alleviation activities during the Reporting Period and has no subsequent
plans yet.
3. Issues Related to Environmental Protection
Indicate by tick mark whether the Company or any of its subsidiaries is identified as a major polluter by the
environmental protection authorities.□ Yes √ No
XIX Other Significant Events
√ Applicable □ Not applicable
Since the planning for major asset restructuring the Company's stocks have been suspended for trading since the
opening of the stock market on 14 September 2016. During the suspension period the Company kept close
communication with all trading parties worked hard in due diligence auditing evaluation and other issues and
fulfilled the required decision-making procedures and information disclosure timely. In view of the current market
environment and many other reasons it was still not a good time to advance the major asset restructuring.Therefore in order to effectively protect the interests of the Company and all shareholders the Company decided
to terminate the major asset restructuring after careful consideration. On 9 November 2020 the stock trading
resumed. For details please refer to the Announcement on the Termination of Planning for Major Asset
Restructuring and the Stock Trading Resumption (No. 2020-085) which was disclosed by the Company on
www.cninfo.com.cn on 9 November 2020.XX Significant Events of Subsidiaries
□ Applicable √ Not applicable
Part VI Share Changes and Shareholder Information
I. Share Changes
1. Share Changes
Unit: share
Before Increase/decrease (+/-) After
Shares
Percentag
e (%)
New
issues
Shares as
dividend
converte
d from
profit
Shares as
dividend
converte
d from
capital
reserves
Other
Subtota
l
Shares
Percenta
ge (%)
1. Restricted shares 0 0.00% 0 0 0 0 0 0 0.00%
1.1 Shares held by the
state
0 0.00% 0 0 0 0 0 0 0.00%
1.2 Shares held by
state-own
Legal-person
0 0.00% 0 0 0 0 0 0 0.00%
1.3 Shares held by
other domestic
investors
0 0.00% 0 0 0 0 0 0 0.00%
Among which: shares
held by domestic
legal person
0 0.00% 0 0 0 0 0 0.00%
Shares held by
domestic natural
person
0 0.00% 0 0 0 0 0 0 0.00%
1.4 Oversea
shareholdings
0 0.00% 0 0 0 0 0 0.00%
Among which: shares
held by oversea legal
person
0 0.00% 0 0 0 0 0 0 0.00%
Shares held by
oversea natural
person
0 0.00% 0 0 0 0 0 0 0.00%
2. Unrestricted shares
101166000
0
100.00% 0 0 0 0 0
101166000
0
100.00%
2.1 RMB ordinary
shares
891660000 88.14% 0 0 0 0 0 891660000 88.14%
2.2 Domestically 120000000 11.86% 0 0 0 0 0 120000000 11.86%
listed foreign shares
2.3 Oversea listed
foreign shares
0 0.00% 0 0 0 0 0 0 0.00%
2.4 Other 0 0.00% 0 0 0 0 0 0 0.00%
3. Total shares
101166000
0
100.00% 0 0 0 0 0
101166000
0
100.00%
Reasons for share changes:
□ Applicable √ Not applicable
Approval of share changes:
□ Applicable √ Not applicable
Transfer of share ownership:
□ Applicable √ Not applicable
Progress on any share repurchase:
□ Applicable √ Not applicable
Progress on reducing the repurchased shares by means of centralized bidding:
□ Applicable √ Not applicable
Effects of share changes on the basic and diluted earnings per share equity per share attributable to the Company’s
ordinary shareholders and other financial indicators of the prior year and the prior accounting period respectively:
□ Applicable √ Not applicable
Other information that the Company considers necessary or is required by the securities regulator to be disclosed:
□ Applicable √ Not applicable
2. Changes in Restricted Shares
□ Applicable √ Not applicable
II. Issuance and Listing of Securities
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
ordinary
shareholders
74276
Number of
ordinary
shareholders at
the month-end
prior to the
disclosure of
this Report
74556
Number of
preferred
shareholders
with resumed
voting rights (if
any)
0
Number of
preferred
shareholders
with resumed
voting rights at
the month-end
prior to the
disclosure of
this Report (if
any)
0
Shareholding of ordinary shareholders holding more than 5% shares or the top 10 of ordinary shareholders
Name of shareholder
Nature of
shareholder
Holdin
g
percent
age (%)
Number of
shareholdin
g at the end
of the
Reporting
Period
Increase and
decrease of
shares during
Reporting
Period
Numbe
r of
shares
held
subject
to
trading
morator
ium
Number of
shares held
subject to
trading
moratorium
Pledged or
frozen shares
Status
of
shares
Amou
nt
Shenzhen Investment
Holdings Co. Ltd
State-owned legal
person
63.55%
64288426
2
0 642884262
Sun Longzhan
Domestic natural
person
0.14% 1464248 1464248 1464248
Yang Shuilian
Domestic natural
person
0.14% 1412900 139200 1412900
Tan Shiqing
Domestic natural
person
0.13% 1286701 0 1286701
Yang Jianxiong
Domestic natural
person
0.12% 1255750 0 1255750
Shenzhen Bao'an
Songgang Huamei
Industry Company
Domestic
non-state-owned
legal person
0.12% 1205096 1205096 1205096
Duan Weiping
Domestic natural
person
0.12% 1190000 1190000 1190000
Central Huijin Asset
Management Co. Ltd.State-owned legal
person
0.12% 1165500 0 1165500
Hong Kong Securities
Clearing Company Ltd.
Foreign legal
person
0.11% 1117641 1117641 1117641
Wu Haoyuan
Foreign natural
person
0.11% 1109300 0 1109300
Strategic investor or general legal person
becoming a top-10 ordinary shareholder
due to rights issue (if any) (see Note 3)
None
Related or acting-in-concert parties among
the shareholders above
Among the top 10 shareholders of the Company SPG is neither a related
party to nor one of the persons acting in concert with other shareholders
as prescribed in the Administrative Measures for the Acquisition of Listed
Companies. 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.
Above shareholders involved in
entrusting/being entrusted with voting
rights and giving up voting rights
None
Top 10 unrestricted shareholders
Name of shareholder
Unrestricted
shares held at the
period-end
Shares by type
Type Shares
Shenzhen Investment Holdings Co. Ltd 642884262 RMB ordinary shares 642884262
Sun Longzhan 1464248 RMB ordinary shares 1464248
Yang Shuilian 1412900 RMB ordinary shares 1412900
Tan Shiqing 1286701 RMB ordinary shares 1286701
Yang Jianxiong 1255750
Domestically listed
foreign shares
1255750
Shenzhen Bao'an Songgang Huamei Industry Company 1205096 RMB ordinary shares 1205096
Duan Weiping 1190000 RMB ordinary shares 1190000
Central Huijin Asset Management Co. Ltd. 1165500 RMB ordinary shares 1165500
Hong Kong Securities Clearing Company Ltd. 1117641 RMB ordinary shares 1117641
Wu Haoyuan 1109300
Domestically listed
foreign shares
1109300
Related or acting-in-concert parties
among top 10 unrestricted public
shareholders as well as between top 10
unrestricted public shareholders and top
10 shareholders
Among the top 10 unrestricted public shareholders of the Company SPG is
neither a related party to nor one of the persons acting in concert with other
shareholders as prescribed in the Administrative Measures for the Acquisition
of Listed Companies. 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.
Top 10 ordinary shareholders involved
in securities margin trading (if any)
(see Note 4)
Both the fourth and sixth shareholders held all their shares of the Company in
their margin 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
Name of controlling
shareholder
Legal
representative/p
erson in charge
Date of
establishment
Unified social
credit code
Principal activity
Shenzhen Investment
Holdings Co. Ltd.Wang Yongjian 13 October 2004 767566421
Investment in equities on behalf of the
government and management of those
investments; development and operation
of government-allocated land; and
investment in and provision of services
for strategic emerging industries
Controlling shareholder’s
holdings in other listed
companies at home or
abroad in the Reporting
Period
339450000 shares in SZPRD A (000011) representing a stake of 56.96%;;
234070000 shares in STHC (000045) representing a stake of 46.10%;
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%;
609240000 of A shares and 103370000 of H shares in Guotai Junan (601211)
representing a stake of 8%;
195030000 shares in Telling Holding (000829) representing a stake of 18.89%;
208850000 shares in Shenzhen International (00152) representing a stake of 43.91%;
604820000 shares in BEAUTYSTAR (002243) representing a stake of 49.96%;
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 18.30%;
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 4.84%;
77270000 shares in Vanke (02202) representing a stake of 0.67%.
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
Name of actual controller
Legal
representative/p
erson in charge
Date of
establishment
Unified social
credit code
Principal activity
Shenzhen State-owned
Assets Supervision and
Administration Commission
Yu Gang 31 July 2004 K3172806-7
Perform the responsibilities of
investor on behalf of the state and
supervise and manage the
authorized state-owned assets
legally.Other listed companies at In addition to the Company controlling shareholder - Shenzhen Investment Holding Co.home or abroad controlled
by the actual controller in
the Reporting Period
Ltd. Other domestic and overseas listed companies whose equity held by the actual
controllers did not rank among the top ten shareholders of the Company.
Change of the actual controller during the Reporting Period:
□ Applicable √ Not applicable
No such cases in the Reporting Period.Ownership and control relations between the actual controller and the Company:
Indicate by tick mark whether the actual controller controls the Company via trust or other ways of asset management.
□ Applicable √ Not applicable
4. Other 10% or Greater Corporate Shareholders
□ Applicable √ Not applicable
5. Limitations on Shareholding Decrease by the Company’s Controlling Shareholder Actual Controller
Reorganizer and Other Commitment Makers
□ Applicable √ Not applicable
Part VII Preferred Shares
□ Applicable √ Not applicable
No preferred shares in the Reporting Period.Part VIII Convertible Bonds
□ Applicable √ Not applicable
No convertible bonds in the Reporting Period.Part IX Directors Supervisors Senior Management and Staff
I Change in Shareholdings of Directors Supervisors and Senior Management
Name Office title
Incumbent/
Former
Gend
er
Age
Start of
tenure
End
of
tenure
Beginni
ng
shareho
lding
(share)
Increase
in the
Reportin
g Period
(share)
Decreas
e in the
Reporti
ng
Period
(share)
Other
increas
e/decre
ase
(share)
Ending
shareh
olding
(share)
Liu
Zhengyu
Chairman of
the Board
Incumbent Male 51
15 January
2020
0 0 0 0 0
Tang
Xiaoping
Director Incumbent Male 51
31 December
2020
0 0 0 0 0
Tang
Xiaoping
GM Incumbent Male 51
14 December
2020
0 0 0 0 0
Deng
Kangcheng
Director Incumbent Male 55
17 April
2012
10000 0 0 0 10000
Zhao
Zhongliang
Director Incumbent Male 51
31 December
2020
0 0 0 0 0
Zhao
Zhongliang
CFO Incumbent Male 51
14 December
2020
0 0 0 0 0
Wen Li Director Incumbent
Femal
e
52
8 September
2006
0 0 0 0 0
Sun
Minghui
Director Incumbent Male 40
31 December
2020
0 0 0 0 0
Kang
Xiaoyue
Independent
director
Incumbent Male 57 15 May 2018 0 0 0 0 0
He
Zuowen
Independent
director
Incumbent Male 59 30 June 2020 0 0 0 0 0
Mi
Xuming
Independent
director
Incumbent Male 46 30 June 2020 0 0 0 0 0
Li Lian
Chairman of
the
Supervisory
Committee
Incumbent
Femal
e
54
31 December
2020
0 0 0 0 0
Ren Wei Supervisor Incumbent Male 41 15 May 2018 2000 0 0 0 2000
Li Yufei Supervisor Incumbent
Femal
e
43
17 April
2012
0 0 0 0 0
Feng
Hongwei
Supervisor Incumbent Male 50
2 March
2017
0 0 0 0 0
Lin Jun Supervisor Incumbent
Femal
e
52
27 April
2016
0 0 0 0 0
Wei
Hanping
Vice GM Incumbent
Femal
e
55
28
September
2012
0 0 0 0 0
Zhang
Hongwei
Vice GM Incumbent Male 55 15 July 2020 0 0 0 0 0
Luo Yi
Secretary of
the Board
Incumbent Male 47
31 December
2020
0 0 0 0 0
Zhou
Jianguo
Chairman of
the Board
Former Male 66
11 February
2009
15
Janua
ry
2020
0 0 0 0 0
Zhuang
Quan
Chairman of
the
Supervisory
Committee
Former Male 66
17 April
2012
15
Janua
ry
2020
80000 0 0 0 80000
Chen
Maozheng
General
Manager and
Director
Former Male 57
17 April
2012
30
June
2020
0 0 0 0 0
Song
Botong
Independent
director
Former Male 53
15 October
2010
30
June
2020
0 0 0 0 0
Zhang
Shunwen
Independent
director
Former Male 55
23 April
2014
30
June
2020
0 0 0 0 0
Zhang Lei Director Former Male 53
17 April
2012
31
Dece
mber
2020
0 0 0 0 0
Zhang Lei CFO Former Male 53
17 April
2012
14
Dece
mber
2020
0 0 0 0 0
Jiang
Lihua
Director Former
Femal
e
57
17 April
2012
31
Dece
mber
2020
0 0 0 0 0
Dai
Xianhua
Chairman of
the
Supervisory
Committee
Former Male 59
15 January
2020
31
Dece
mber
2020
0 0 0 0 0
Tang
Xiaoping
Secretary of
the Board
Appointed
and
Male 51
26 April
2018
31
Dece
0 0 0 0 0
dismissed mber
2020
Tang
Xiaoping
Vice GM
Appointed
and
dismissed
Male 51
22 October
2013
14
Dece
mber
2020
0 0 0 0 0
Total -- -- -- -- -- -- 92000 0 0 0 92000
II Change of Directors Supervisors and Senior Management
√Applicable □ Not applicable
Name Office title Type of change Date of change Reason for change
Liu Zhengyu Chairman of the Board Elected 15 January 2020
Dai Xianhua
Chairman of the
Supervisory Committee
Elected 15 January 2020
Zhou Jianguo Chairman of the Board Left 15 January 2020 Retired
Zhuang Quan
Chairman of the
Supervisory Committee
Left 15 January 2020 Retired
Chen Maozheng Director Left 30 June 2020 Job change
Chen Maozheng General Manager Left 30 June 2020 Job change
Song Botong Independent director
Left for expiration
of appointment
30 June 2020 Expiration of appointment
Zhang Shunwen Independent director
Left for expiration
of appointment
30 June 2020 Expiration of appointment
He Zuowen Independent director Elected 30 June 2020
Mi Xuming Independent director Elected 30 June 2020
Zhang Hongwei Vice GM Appointed 15 July 2020
Tang Xiaoping GM Appointed 14 December 2020
Tang Xiaoping Vice GM Appointed 14 December 2020 Post change
Zhang Lei CFO Left 14 December 2020 Job change
Zhao Zhongliang CFO Appointed 14 December 2020
Zhang Lei Director Left 31 December 2020 Job change
Jiang Lihua Director Left 31 December 2020 Retired
Tang Xiaoping Director Elected 31 December 2020
Sun Minghui Director Elected 31 December 2020
Zhao Zhongliang Director Elected 31 December 2020
Dai Xianhua
Chairman of the
Supervisory Committee
Left 31 December 2020 Job change
Li Lian
Chairman of the
Supervisory Committee
Elected 31 December 2020
Tang Xiaoping Secretary of the Board Appointed 31 December 2020 Post change
Luo Yi Secretary of the Board Appointed 31 December 2020
III 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 and Chief Accountant of
Shenzhen Investment Holdings Co. Ltd. Now he acts as the vice GM and the member of CPC of Shenzhen
Investment Holdings Co. Ltd. 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 and Vice Secretary of CPC of the Company.
4. Zhao Zhongliang: former director and CFO of Shenzhen Rosso Pharmaceutical Co. Ltd. member of the
president team and CFO of Sichuan Lisen Building Materials Group Co. Ltd. supervisor of Ningbo Haiyue New
Materials Co. Ltd. director and CFO of Shenzhen Investment Control Property Management Co. Ltd. director
and CFO of Shenzhen Shentou Education Co. Ltd.; currently serves as 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 vive 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 News Department of Shenzhen Legal Newspaper. Chief Lawyer senior partner of Guangdong New
Century Law Firm (now 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 and director of teaching and research section of
Changsha University of Science & Technology partner and deputy director of Shenzhen Huapeng Certified
Public Accountants partner of BDO Certified Public Accountants; currently partner of Dahua Certified Public
Accountants (Special General Partnership) Secretary of CPC General Branch of Shenzhen Branch Chairman of
Shenzhen Tianye Tax Agent Co. Ltd. and also served as the independent director of Shenzhen 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 member of the Shenzhen Municipal Social Organization
Disciplinary Inspection Committee of the Communist Party of China deputy secretary and secretary of the
Disciplinary Committee of Shenzhen CPA Industry Committee and director of Shenzhen Certified Tax Agents
Association.
9. Mi Xuming: Former lecturer at Shenzhen University postdoctor 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 and Secretary of the
Disciplinary Committee 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 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 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 manager of Dongle Project 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 the shareholding
entity
Start of tenure
End of
tenure
Remuneration or
allowance from
the shareholding
entity
Liu
Zhengyu
Shenzhen Investment
Holdings Co. Ltd
Vice GM member of CPC 9 January 2017 Yes
Sun
Minghui
Shenzhen Investment
Holdings Co. Ltd
Chief of Financial Department
(Settlement Center)
11 November 2020 Yes
Ren Wei
Shenzhen Investment
Holdings Co. Ltd
Vice minister of Audit
Department
18 September 2017 Yes
Li Yufei
Shenzhen Investment
Holdings Co. Ltd
Deputy Director of Discipline
Inspection Office
9 July 2015 Yes
Offices held concurrently in other entities:
√Applicable □Not applicable
Name Other entity
Office held
in the
entity
Start of tenure End of tenure
Remunerati
on or
allowance
from the
entity
Liu
Zhengyu
Shenzhen Urban Transport Planning
Center Co.. Ltd.
Director 17 October 2017 17 December 2019 No
Liu
Zhengyu
Telling Telecommunication Holding
Co. Ltd.
Director 2 March 2017 23 April 2020 No
Liu
Zhengyu
China's State Owned Capital Venture
Capital Fund
Director 16 August 2016 No
Liu
Zhengyu
Kashi Shenzhen City Co. Ltd. Director 8 October 2013 No
Liu
Zhengyu
Shenzhen Investment Holdings Bay
Area Development Co. Ltd.
Non-execut
ive
director
Chairman
of the
Board
14 March 2018 No
Liu
Zhengyu
Shenzhen Investment International
Capital Holdings Infrastructure Co.
Ltd.
Director 18 December 2017 No
Liu
Zhengyu
Shenzhen Investment International
Capital Holdings Co. Ltd.
Director 9 September 2016 No
Liu
Zhengyu
Tsinghua Tri Shenzhen Co. Ltd. Director
December 12
2019
No
Liu
Zhengyu
SIHC Hong Kong Investment Holdings
Limited
Director March 11 2019 No
Liu
Zhengyu
Research Institute of Tsinghua
University in Shenzhen
Member of
a council
April 10 2018 No
Deng
Kangcheng
Shenzhen Leaguer Co. Ltd. Director June 15 2020 No
Wen Li
Shenzhen Bay Technology
Development Co. Ltd.
Director
GM and
Vice
Secretary
of CPC
December 1 2016 Yes
Sun
Minghui
Meizhou Shenmei Friendship Building
Co. Ltd.
Director January 13 2014 June 18 2020 No
Sun
Minghui
China Nanshan Development (Group)
Co. Ltd.
Supervisor October 17 2017 No
Sun
Minghui
Shenzhen Highway Passenger
Transportation Service Centre Co. Ltd.Supervisor June 16 2017 No
Sun
Minghui
China Science And Technology
Development Co. Ltd.
Supervisor June 27 2017 No
Sun
Minghui
ULTRARICH INTERNATIONAL
LIMITED
Director
November 11
2020
No
Sun
Minghui
China Southern Fund Management Co.
Ltd.Supervisor
November 11
2020
No
Sun
Minghui
Hubei SIHC Investment Development
Co. Ltd.
Director
November 11
2020
No
Sun
Minghui
Shenzhen Textile (Holdings) Co. Ltd. Director February 10 2021 No
Ren Wei
Shenzhen Construction & Installation
(Group) Co. Ltd.Supervisor October 22 2017 July 8 2020 No
Ren Wei
Shenzhen Sungang China Resources
Land Development Co. Ltd.Supervisor October 17 2017 No
Li Yufei Shenzhen Dapengwan Huaqiao Tomb Director
November 19
2015
No
Li Yufei
Shenzhen Sports Center Operation
Management Co. Ltd.Supervisor
December 22
2015
June 18 2020 No
Kang
Xiaoyue
Beijing Weiheng (Shenzhen) Law Firm
Senior
partner
December 2 2019 Yes
He
Zuowen
Dahua Certified Public Accountants
(Special General Partnership)
Partner December 1 2002 Yes
He
Zuowen
Shenzhen Tianye Tax Agency Co. Ltd.
Chairman
of the
Board
December 1 2008 Yes
He
Zuowen
Shenzhen JPT Opto-Electronics Co.Ltd.Independen
t director
June 1 2017 Yes
He
Zuowen
Shenzhen Textile (Holdings) Co. Ltd.Independen
t director
July 19 2017 Yes
He
Zuowen
Shenzhen Bioeasy Biotechnology Co.Ltd.Independen
t director
October 1 2017 Yes
He
Zuowen
Shenzhen Tongyi Industry Co. Ltd.Independen
t director
October 11 2018 Yes
Mi
Xuming
Shenzhen University
Associate
professor
and master
tutor
December 1 2009 Yes
Mi
Xuming
ChinaLin Securities Co. Ltd.
Independen
t director
April 10 2017 Yes
Mi
Xuming
Shenzhen Farben Information
Technology Co. Ltd.Independen
t director
January 29 2021 Yes
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
IV 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.
3. He Zuowen an independent director also receives the allowance of independent director in Shenzhen Textile (Group)
Co. Ltd. Shenzhen textile (Group) Co. Ltd and the Company are under the control of the same dominant shareholder and
are related parties of the Company.Remuneration of directors supervisors and senior management for the Reporting Period
Unit: RMB’0000
Name Office title Gender Age
Incumbent/For
mer
Total before-tax
remuneration
from the
Company
Any
remuneration
from related
party
Liu Zhengyu
Chairman of the
Board
Male 51 Incumbent Yes
Tang Xiaoping
Director and
GM
Male 51 Incumbent 115.02 No
Deng
Kangcheng
Director Male 55 Incumbent 117.32 No
Zhao
Zhongliang
Director and
CFO
Male 51 Incumbent Yes
Wen Li Director Female 52 Incumbent Yes
Sun Minghui Director Male 40 Incumbent Yes
Kang Xiaoyue
Independent
director
Male 57 Incumbent 8.4 No
He Zuowen
Independent
director
Male 59 Incumbent 4.2 Yes
Mi Xuming
Independent
director
Male 46 Incumbent 4.2 No
Li Lian
Chairman of the
Supervisory
Committee
Female 54 Incumbent Yes
Ren Wei Supervisor Male 41 Incumbent Yes
Li Yufei Supervisor Female 43 Incumbent Yes
Feng Hongwei Supervisor Male 50 Incumbent 63.93 No
Lin Jun Supervisor Female 52 Incumbent 63.93 No
Wei Hanping Vice GM Female 55 Incumbent 117.32 No
Zhang Hongwei Vice GM Male 55 Incumbent 80.3 No
Luo Yi
Secretary of the
Board
Male 47 Incumbent 60.44 No
Zhou Jianguo
Chairman of the
Board
Male 66 Former 59.44 No
Zhuang Quan
Chairman of the
Supervisory
Committee
Male 66 Former 46.5 No
Chen
Maozheng
General
Manager and
Director
Male 57 Former 89.4 Yes
Song Botong
Independent
director
Male 53 Former No
Zhang Shunwen
Independent
director
Male 55 Former 4.2 No
Zhang Lei
Director and
CFO
Male 53 Former Yes
Jiang Lihua Director Female 57 Former Yes
Dai Xianhua
Chairman of the
Supervisory
Committee
Male 59 Former Yes
Total -- -- -- -- 834.6 --
Equity incentives for directors supervisors and senior management in the Reporting Period:
□ Applicable √ Not applicable
V Employees
1. Number Functions and Educational Backgrounds of Employees
Number of in-service employees of the Company as the
parent
100
Number of in-service employees of major subsidiaries 1568
Total number of in-service employees 1668
Total number of paid employees in the Reporting Period 1665
Number of retirees to whom the Company as the parent or
its major subsidiaries need to pay retirement pensions
0
Functions
Function Employees
Production 1053
Sales 78
Technical 412
Financial 51
Administrative 74
Total 1668
Educational backgrounds
Educational background Employees
Doctors 1
Masters 21
Bachelors 169
College graduates 245
Technical secondary school graduates 100
High school graduates and below 1132
Total 1668
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
Part X 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 Guidelines for Standardized
Operation of Listed Companies of Shenzhen Stock Exchange 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 Guidelines for the Standardized Operation of Listed Companies of Shenzhen Stock Exchange the
Articles of Association and the Rules of Procedure of the Board of Supervisors of the Company exercised the
power of supervision effectively gave a full play to the supervisory function have played a substantial role in the
operation and management of the Company and have protected the legitimate rights and interests of the Company
and the shareholders.
(4) Operation at manager level
The manager level of the Company has performed its duties in strict accordance with the Company Law the
Guidelines for the Standardized Operation of Listed Companies of Shenzhen Stock Exchange 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 the regulatory documents issued by the CSRC
governing the governance of listed companies.□ Yes √ No
No such cases in the Reporting Period.II The Company’s Independence from Its Controlling Shareholder in Business Personnel
Asset Organization and Financial Affairs
(I) In respect of business the Company possessed independent production supply and sales system;
(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 assets the Company possessed independent and integrated assets and the property of the
Company is transparent.
(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 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.III Horizontal Competition
□ Applicable √ Not applicable
IV Annual and Special General Meetings Convened during the Reporting Period
1. General Meeting Convened during the Reporting Period
Meeting Type
Investo
r
particip
ation
ratio
Date of the
meeting
Disclosure date
Index to disclosed
information
The 1
st
Extraordinary
General Meeting of 2020
Extraordinary
General
Meeting
63.59% 15 January 2020 16 January 2020
Announcement on
Resolutions of the 1
st
Extraordinary General
Meeting of 2020 disclosed
on www.cninfo.com.cn.The 2019 Annual General
Meeting
Annual
General
Meeting
63.60% 29 April 2020 30 April 2020
Announcement on
Resolutions of 2019
Annual General Meeting
disclosed on
www.cninfo.com.cn.The 2
nd
Extraordinary
General Meeting of 2020
Extraordinary
General
Meeting
63.59% 30 June 2020 1 July 2020
Announcement on
Resolutions of the 2
nd
Extraordinary General
Meeting of 2020 disclosed
on www.cninfo.com.cn.The 3
rd
Extraordinary
General Meeting of 2020
Extraordinary
General
Meeting
63.56%
31 December
2020
4 January 2021
Announcement on
Resolutions of the 3
rd
Extraordinary General
Meeting of 2020 disclosed
on www.cninfo.com.cn.
2. Special General Meetings Convened at the Request of Preferred Shareholders with Resumed Voting
Rights
□ Applicable √Not applicable
V Performance of Duty by Independent Directors in the Reporting Period
1. Attendance of Independent Directors at Board Meetings and General Meetings
Attendance of independent directors at board meetings and general meetings
Independent
director
Total number
of board
meetings the
independent
director was
eligible to
attend
Board
meetings
attended on
site
Board
meetings
attended by
way of
telecommuni
cation
Board
meetings
attended
through a
proxy
Board
meetings the
independent
director
failed to
attend
The
independent
director
failed to
attend two
consecutive
board
meetings
(yes/no)
General
meetings
attended
Song Botong 4 4 0 0 0 No 3
Zhang Shunwen 4 4 0 0 0 No 1
Kang Xiaoyue 11 7 4 0 0 No 4
He Zuowen 7 3 4 0 0 No 1
Mi Xuming 7 3 4 0 0 No 1
Why any independent director failed to attend two consecutive board meetings:
Not applicable
2. Objections Raised by Independent Directors on Matters of the Company
Indicate by tick mark whether any independent directors raised any objections on any matter of the Company.□ Yes √ No
No such cases in the Reporting Period.
3. Other Information about the Performance of Duty by Independent Directors
Indicate by tick mark whether any suggestions from independent directors were adopted by the Company.√ Yes □ No
Suggestions from independent directors adopted or not adopted by the Company:
In reviewing major matters concerning production and operation decision-making nomination of directors and
appointment of senior managers the independent directors of the Company have obtained the actual situation
through on-site investigation inquiry to relevant personnel and search for and access to information made
prudent judgments by using their own professional knowledge and expressed independent objective and
impartial opinions which are not affected by the Company's dominant shareholders actual controllers or other
institutions and individuals who have any interest in the Company.VI Performance of Duty by Specialized Committees under the Board in the Reporting Period
The board of directors of the Company has a strategy committee an audit committee a nomination committee and
a salary and assessment committee set under it. During the reporting period the special committees have carried
out their work actively and efficiently which has effectively promoted the standardized operation and scientific
decision-making of the board of directors.
1. Performance of the Strategic Committee of the Board of Directors
The strategy committee of the board of directors of the Company focuses on the development status and the trend
of the industry and studies the Company's long-term development strategy and major investment decisions.
2. Performance of the Audit Committee of the Board of Directors
The Audit Committee of the Board of Directors actively promoted the progress of the annual audit and the
relevant work. It reviewed on the Company’s following issues: Arrangement on the Annual Audit Work Periodic
Financial Report Profit Distribution Plan Renewal of CPAs Firm Auditing of Internal Control Fund Transfer
Between Listed Companies and Related Parties and Guarantee Events etc. Besides it also kept full and necessary
communication with the annual auditor of the Company. During the Reporting Period the Audit Committee of the
Board of Directors has convened four meetings reviewed the Company’s financial statements and the auditing
result issued by the annual auditor of the Company as well as issued their opinions after the review and remarked
for the Annual Financial Report Provisions for Asset Impairment and Renewal of CPAs Firm.
3. Performance of the Remuneration and Appraisal Committee of the Board of Directors
During the reporting period the remuneration and assessment committee of the board of directors has held
meetings to review the remuneration of directors supervisors and senior managers disclosed in the 2019 Annual
Report carefully so as to ensure that the information disclosed is true accurate and complete.
4. Performance of the Nomination Committee of the Board of Directors
During the reporting period the nomination committee of the board of directors of the Company has held four
meetings to review the candidates of independent directors non-independent directors and senior managers.VII 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.VIII Appraisal of and Incentive for Senior Management
The Company's board of directors assesses evaluates and employs management teams. The Company’s chairman
and general manager implement the annual salary system and the annual salary is composed of basic salary and
performance compensation. The shareholder unit formulates assessment methods for assessment. The other senior
management personnel's compensation is determined based on individual job performance with reference to the
total salary of the Company’s leader; the Company has not implemented equity incentive plan.IX Internal Control
1. Material Internal Control Weaknesses Identified for the Reporting Period
□ Yes √ No
2. Internal Control Self-Evaluation Report
Disclosure date of the internal control
self-evaluation report
20 March 2021
Index to the disclosed internal control
self-evaluation report
2020 Internal Control Self-Evaluation Report on www.cninfo.com.cn
Evaluated entities’ combined assets as
% of consolidated total assets
86.88%
Evaluated entities’ combined operating
revenue as % of consolidated
operating revenue
100.00%
Identification standards for internal control weaknesses
Type
Weaknesses in internal control over financial
reporting
Weaknesses in internal control not related to
financial reporting
Nature
standard
The Company in line with the actual situation when
the follows events or indications happen which
means there probably existing serious or important
defects in the financial report; (1) the directors
supervisors and senior executives were fraud. (2)
Certified Public Accountant find that there is a
significant error in the financial report however the
internal control did not discover it when conducting
internal control; (3) The Audit Committee under the
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 follows events or
indicators occur there may be serious or important
defects of internal control in the non-financial
statements:(1) Lack democratic decision-making
Board and Internal Audit Service's supervision to
the internal control is invalid. (4) The accounting
personnel were without necessary qualities to
complete the preparation of financial statements.process if lack significant problem
decision-making important appointment and
dismissal of cadres significant project investment
decision-making; usage of large capital (three
important one large); (2) Unscientific
decision-making process such as the major
decision-making errors has caused a serious
property loss to the company; (3) Seriously
violating state laws and regulations; (4) Loss of
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 may
lead to the financial results misstatement or
potential losses >3% of net assets; important
defects: 1% of net assets
group may lead to the financial results misstatement
or potential losses ≤ 3% of net assets; General
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
The criterion of quantity of the recognition of
defects of internal control in the non-financial
statements mainly were amount of direct economy
losses in line with the criterion of quantity of the
recognition of defects of internal control in
financial report of the Company.Number of material weaknesses in internal
control over financial reporting
0
Number of material weaknesses in internal
control not related to financial reporting
0
Number of serious weaknesses in internal
control over financial reporting
0
Number of serious weaknesses in internal
control not related to financial reporting
0
X 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 2020 in accordance with Basic
Standards for Internal Control and relevant regulations.Independent auditor’s report on
internal control disclosed or not
Disclosed
Disclosure date 20 March 2021
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
reporting
No
Indicate by tick mark whether any modified opinion is expressed in the independent auditor’s report on the Company’s
internal control.□ Yes √ No
Indicate by tick mark whether the independent auditor’s report on the Company’s internal control is consistent with the
internal control self-evaluation report issued by the Company’s Board.√ Yes □ No
Part XI Corporate Bonds
Does the Company have any corporate bonds publicly offered on the stock exchange which were outstanding before
the date of this Report’s approval or were due but could not be redeemed in full?
No
Part XII Financial Statements
Type of the audit opinion Unmodified unqualified opinion
Date of signing this report 19 March 2021
Name of the audit institution Grant Thornton Accounting Firm (LLP)
Number of the audit report GTCNSZ（2021）NO.441A000013
Name of the certified public accountants Zhao Juanjuan Jiang Xiaoming
Auditor’s Report
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 and its subsidiaries (the "Group") which comprise the
consolidated and company statement of financial position as at 31 December 2020 the
consolidated and company statement of comprehensive income the consolidated and company
cash flows for the year then ended consolidated and company statement of changes in equity
and the notes to the financial statements.In our opinion the accompanying consolidated and company financial statements present fairly
in all material respects the Group’s consolidated and company financial position as at 31
December 2020 and their consolidated financial performance and their 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 the China Standards on Auditing. Our
responsibilities under those standards are further described in the Auditor’s Responsibilities for
the Audit of the Financial Statement Section of our report. We are independent of the Group in
accordance with the Code of Ethics for Chinese 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.1.Revenue recognition from sales of properties
The relevant detailed information is set out in Notes III. 23 and Note V.29.
(1) Descriptions of the matter
In 2020 the revenue from sales of properties was RMB 1.158 billion that accounted for 71.73%
of total revenue of the Group.When all of the following conditions have been met the Group recognizes the revenue of sales
of properties: ①the signed sales contract filed with the land department;②properties have
been completed and accepted; ③fully one-off payment or the first installment payment has
been received and the bank mortgage approval procedures have been completed;④the
procedures of housing delivery have completed in accordance with the sales contract.
Due to the importance of revenue from sales of properties and any misstatements in revenue
recognition will have a significant impact on the profit of the Group. Therefore the revenue
recognition from sales of properties is a key audit matter.
(2) How our audit addressed the Key Audit Matter
Our audit procedures for the recognition of revenue include:
① Understanding assessing and testing the design and implementation of key internal
controls about the progress of contract performance and revenue recognition.
② Examining the main clauses in sales contracts to evaluate the appropriateness of the
Group’s revenue recognition policy associated with the relevant accounting standards;
③ 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.
④ 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
⑤ Calculating average house price and comparing it with the price from last year to
analyze the reasonableness of revenue and gross profit.
⑥ 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.
2. Accuracy of land appreciation tax calculations
The relevant detailed information is set out in Notes IV. tax and Note V.30.
(1) Descriptions of the matter
Land appreciation tax is the main tax category for the Group.
For the sales of properties land appreciation tax (“LAT”) is charged at a progressive tax rate of
30%-60%. At the end of reporting period management evaluates the provision of LAT with the
consideration of factors including the provisions of the relevant taxation estimable revenue
minus deductible land costs costs of real estate development interest expense development
expense etc. It is possible that a significant difference exists between actual and estimated
taxable amount.
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) How our audit addressed the Key Audit Matter
Our audit procedures for the land appreciation tax include:
① Evaluating the design and effectiveness of key internal controls related to the
measurement of LAT;
② Involved our internal tax specialists in the PRC to assess the provision of LAT on 31
December 2020 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;
③ 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;
④ Recalculating the amount of provision of LAT and comparing it to management
estimate.Other Information
Management is responsible for the other information. The other information comprises the
information included in the Annual Report of 2020 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
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
Management of the Group 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
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 cas t 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 the 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
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 the governance body with a statement that we have complied with relevant
ethical requirements regarding independence and to communicate with them all relationships
and other matters that may reasonably be thought to bear on our independence and where
applicable related safeguards.
From the matters communicated with the governance body we determine those matters that
were of most significance in the audit of the financial statements of the current period and are
therefore the key audit matters. We describe these matters in our auditor’s report unless law or
regulation precludes public disclosure about the matter or when in extremely rare
circumstances we determine that a matter should not be communicated in our report because
the adverse consequences of doing so would reasonably be expected to outweigh the public
interest benefits of such communication.Grant Thornton
China·Beijing
Auditor's signature and stamp
Auditor's signature and stamp
China ·Beijing 19March 2021
Consolidated and Company Balance Sheets
As at 31 December 2020
Prepared by：Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd Expressed in RMB
Item Note
As at 31/12/2020 As at 31/12/2019
Consolidated Company Consolidated Company
Current assets:
Cash at bank and on hand V、1 2687465070.01 2329517987.02 2511140445.35 1967688122.55
Financial assets at fair value through profit
or loss
Bills receivable V、2 35438045.34 -
Accounts receivable V、3 59590944.06 5418024.74 62059055.68 156935.84
Accounts receivable financing
Prepayments V、4 3205534.51 200000.00 219948.17 200000.00Other receivables V、5 32745043.84 1160414195.39 28275228.26 835275498.69including：interests receivables
dividends receivables
1052192.76 - 1052192.76
Inventories V、6 1220464112.56 207606220.98 1462229048.18 419453091.86
Contract assets
not applicable not applicable
Assets held for sale
Non-current assets due within one year
Other current assets V、7 102907134.79 945499.13 102781855.48 407560.64Total current assets 4141815885.11 3704101927.26 4166705581.12 3223181209.58
Non-current assets:
Investments in debt obligations
Investments in other debt obligations
Long-term receivables
Long-term equity investments V、8 377489.65 150584167.95 469838.65 150676516.92Investment in other equity instruments V、9 37510860.51 13508202.32 33126730.04 13229501.03Other non-current financial assets
Investment properties V、10 616365621.53 499145554.67 632241900.20 522038731.16
Fixed assets V、11 28039978.43 17743083.73 30522035.11 19586720.47
Construction in progress
Productive biological assets
Oil and gas assets
Intangible assets V、12
Development costs
Goodwill
Long-term deferred expenses V、13 61667.53 61667.53 162125.72 162125.72
Deferred tax assets V、14 112745243.98 83740299.64 46441325.25 20975294.54
Other non-current assets
Total non-current assets 795100861.63 764782975.84 742963954.97 726668889.84
Total assets 4936916746.74 4468884903.10 4909669536.09 3949850099.42
Consolidated and Company Balance Sheets(continued)
As at 31 December 2020
Prepared by：Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd Expressed in RMB
Item Note
As at 31/12/2020 As at 31/12/2019
Consolidated Company Consolidated Company
Current liabilities:
Short-term loans V、15 76893995.94
51647260.17
Financial liabilities at fair value through profit
or loss
Bills payable
Accounts payable V、16 176926614.28 77187914.50 244224478.46 103915931.14
Advances from customers V、17 5940092.15
159482510.43 59409454.38
Contract liabilities V、18 196786977.19 172241938.46 not applicable not applicable
Employee benefits payable V、19 60467834.09 27255860.05 53909576.49 25544403.23
Taxes payable V、20 459709646.95 450281265.17 585700815.36 143434273.95Other payables V、21 277105129.74 194609459.87 277319174.53 190666487.82including：interests payables
16535277.94 16535277.94 16535277.94 16535277.94
dividends payables
Liabilities held for sale
Non-current liabilities due within one year
Other current liabilities V、22 8917027.07 8612096.92Total current liabilities
1262747317.41 930188534.97 1372283815.44 522970550.52
Non-current liabilities:
Long-term loans
Debentures payable
Long-term payables V、23 7480233.43
7499192.92
Provisions
Deferred income
Deferred tax liabilities V、14 9601940.74 4812392.47 4903293.58 1295046.51
Other non-current liabilities
Total non-current liabilities
17082174.17 4812392.47 12402486.50 1295046.51
Total liabilities
1279829491.58 935000927.44 1384686301.94 524265597.03
Share capital V、24 1011660000.00 1011660000.00 1011660000.00 1011660000.00
Capital reserve V、25 978244910.11 964711931.13 978244910.11 964711931.13
Less: treasury shares
Other comprehensive income V、26 28163050.13 1131151.74 20831004.13 922125.77Specific reserve
Surplus reserve V、27 218724273.67 195594660.26 191222838.94 168093225.53Retained earnings V、28 1560720254.31 1360786232.53 1464915816.81 1280197219.96Total equity attributable to shareholders of
the Company
3797512488.22 3533883975.66 3666874569.99 3425584502.39
Non-controlling interests -140425233.06
-141891335.84
Total shareholders' equity 3657087255.16 3533883975.66 3524983234.15 3425584502.39
Total liabilities and shareholders' equity
4936916746.74 4468884903.10 4909669536.09 3949850099.42
Legal representative: Person in charge of accounting: Person in charge of accounting organ:
Consolidated and Company Income Statements
For the year ended 31 December 2020
Prepared by：Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd
Expressed
in RMB
Item Note
Year ended 31/12/2020 Year ended 31/12/2019
Consolidated Company Consolidated Company
I.Operating income V、29 1615009713.88 911839269.70 2548740319.49 1666952912.58Less:operating costs V、29 805508448.68 241307783.52 957752652.54 330874297.00Taxes and surcharges V、30 329962066.50 289600033.09 751013928.21 630418453.86Selling and distribution expenses V、31 55989397.22 42814758.60 79480254.02 56146749.47General and administrative expenses V、32 93616226.75 56022941.66 68854618.70 30540740.51Research and development expenses
Financial expenses V、33 -21505685.05 -39280862.44 -20906149.20 -45894180.92
Including: Interest expenses
38642.51 -
Interest income
30130066.10 51099467.08 19686882.13 41049606.12
Add: Other income V、34 4607772.07 150785.59 1168127.90 18998.01
Investment income ("-" for losses) V、35 15724469.63 15724469.63 32429481.23 551129612.87Including: Income from investment in associates and joint ventures ("-" for losses)
-92348.97 -92348.97 1003829.25 1003829.25
Gains from changes in fair value ("-" for losses)
Credit impairment loss (“-” for loss) V、36 -358999.15 464438.79 -3111257.44 -2029282.38
Impairment losses ("-" for losses) V、37
-12166897.84 -83683888.90
Gains from assets disposal ("-" for losses) V、38 11429.23II.Operating profit ("-" for losses)
371423931.56 337714309.28 730864469.07 1130302292.26
Add: Non-operating income V、39 30693761.57 30679050.88 1345428.49 1042266.31
Less: Non-operating expenses V、40 1684103.97 106542.24 226566.80 64297.33III.Profit before income tax ("-" for losses)
400433589.16 368286817.92 731983330.76 1131280261.24
Less: Income tax expenses V、41 110470834.78 93272470.62 190786300.70 173952583.46IV.Net profit for the year ("-" for net losses)
289962754.38 275014347.30 541197030.06 957327677.78
(1) Classification according to operation continuity
Including: Net profit from continuing operations ("-" for net loss)
289962754.38 275014347.30 541197030.06 957327677.78
Net profit from discontinued operations ("-" for net loss)
(2) Classification according to attibute
Including: Shareholders of the company("-" for net loss)
290229772.23 275014347.30 552452307.59 957327677.78
Non-controlling interests("-" for net loss)
-267017.85
-11255277.53
V.Other comprehensive income net of tax
9065166.63 209025.97 -176622.09 -50766.47
Other comprehensive income (net of tax) attributable to shareholders of the company
7332046.00 209025.97 173182.46 -50766.47
(1) Items that may not be reclassified to profit or loss
3288097.86 209025.97 1653431.27 -50766.47
Changes in the fair value of investments in other equity instruments
3288097.86 209025.97 1653431.27 -50766.47
(2) Items that may be reclassified to profit or loss
4043948.14 - -1480248.81 -
Translation differences arising from translation of foreign currency financial statements
4043948.14
-1480248.81
Other comprehensive income (net of tax) attributable to non-controlling interests
1733120.63
-349804.55
VI.Total comprehensive income for the year
299027921.01 275223373.27 541020407.97 957276911.31
Attributable to:Shareholders of the company
297561818.23 275223373.27 552625490.05
Non-controlling interests
1466102.78
-11605082.08
VII.Earnings per share:
(1) Basic earnings per share
0.2869
0.5461
(2)Diluted earnings per share
0.2869
0.5461
Legal representative: Person in charge of accounting: Person in charge of accounting organ:
Consolidated and Company Cash Flow Statements
For the year ended 31 December 2020
Prepared by：Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd
Expressed in RMB
Item Note
Year ended 31/12/2020 Year ended 31/12/2019
Consolidated Company Consolidated Company
I.Cash flows from operating activities
Proceeds from sales of goods or rendering of services
1729680056.34 1078103371.61 2648597164.58 1787968670.18
Refund of taxes
- -
Proceeds from other operating activities V、42 54027940.71 64609945.07 79679385.47 58719902.38Sub-total of cash inflows
1783707997.05 1142713316.68 2728276550.05 1846688572.56
Payment for goods and services
550912214.50 32909312.44 639208411.38 99847275.06
Payment to and for employees
164940269.68 41972734.54 178713870.65 51174841.78
Payments of various taxes
708116426.50 183703076.95 1199806904.82 916815076.44
Payment for other operating activities V、42 74575073.20 388932614.43 106939638.45 79596205.39Sub-total of cash outflows
1498543983.88 647517738.36 2124668825.30 1147433398.67
Net cash flows from operating activities
285164013.17 495195578.32 603607724.75 699255173.89
II.Cash flows from investing activities
-
-
Proceeds from disposal of investments
- -
Investment returns received
19767503.60 19767503.60 37502720.55 143151908.78
Net proceeds from disposal of fixed assets intangible assets and
other long-term assets
56718.25 - 119900.00
Net proceeds from disposal of subsidiaries and other business units
- -
Proceeds from other investing activities V、42 1000000000.00 1000000000.00 2200000000.00 2200000000.00Sub-total of cash inflows
1019824221.85 1019767503.60 2237622620.55 2343151908.78
Payment for acquisition of fixed assets intangible assets and other
long-term assets
749215.31 - 21918490.62 20824023.65
Payment for acquisition of investments
- -
Net payment for acquisition of subsidiaries and other business units
- -
Payment for other investing activities V、42 - - 2300000000.00 2300000000.00Sub-total of cash outflows
749215.31 - 2321918490.62 2320824023.65
Net cash flows from investing activities 1019075006.54 1019767503.60 -84295870.07 22327885.13
III.Cash flows from financing activities - -
Proceeds from investors - -
Including: Proceeds from non-controlling shareholders of
subsidiaries
- -
Proceeds from borrowings 76893995.94 - 43741293.64
Proceeds from other financing activities - -
Sub-total of cash inflows 76893995.94 - 43741293.64 -
Repayments of borrowings 51647260.17 - 2000000.00
Payment for dividends profit distributions or interest 166923900.00 166923900.00 202370642.51 202332000.00
Including: Dividends and profits paid to non-controlling shareholders
of subsidiaries
- -
Payment for other financing activities - -
Sub-total of cash outflows 218571160.17 166923900.00 204370642.51 202332000.00
Net cash flows from financing activities -141677164.23 -166923900.00 -160629348.87 -202332000.00
IV.Effect of foreign exchange rate changes on cash and cash
equivalents
-647689.01 - -15181.39
V.Net increase in cash and cash equivalents 1161914166.47 1348039181.92 358667324.42 519251059.02
Add: Cash and cash equivalents as at the beginning of the year 1507189760.35 963737437.55 1148522435.93 444486378.53
VI.Cash and cash equivalent as at the year ended 2669103926.82 2311776619.47 1507189760.35 963737437.55
Legal representative: Person in charge of accounting: Person in charge of accounting organ:
Consolidated Statement of Changes in Shareholders' Equity
For the year ended 31 December 2020
Prepared by：Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd Expressed in RMB
Item
Year ended 31/12/2020
Attributable to shareholders' equity of the parent company
Non-controlling
interests
Total
Share capital
Capital
reserve
Less:
treasury
shares
Other
comprehensi
ve income
Specific
reserve
Surplus
reserve
Retained
earnings
I.Balance at the year ended 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 combination involving enterprises under common
control
Others
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 decrease) - - - 7332046.00 - 27501434.73 95804437.50 1466102.78 132104021.01
(I)Total comprehensive income
7332046.00
290229772.23 1466102.78 299027921.01
(II)Shareholders' contributions and decrease of capital - - - - - - - - -
1.Ordinary shares by shareholders
2. Contribution by other equity instruments holders
3. Equity settled share-based payments
4. 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 transfer
2.Share capital increased by surplus reserves transfer
3.Transfer of surplus reserve to offset losses
4. Retained earnings transfered by other comprehensive income
5.Others
(V)Specific Reserve - - - - - - - - -
1. Appropriation during the year
2.Utilisation during the year
(VI)Others
IV.Balance at the year ended 1011660000.00 978244910.11 - 28163050.13 - 218724273.67 1560720254.31 -140425233.06 3657087255.16
Legal representative: Person in charge of accounting: Person in charge of accounting organ:
Consolidated Statement of Changes in Shareholders' Equity
For the year ended 31 December 2020
Prepared by：SHENZHEN SPECIAL ECONOMIC ZONE REAL ESTATE & PROPERTIES (GROUP) Co. Ltd Expressed in RMB
Item
Year ended 31/12/2019
Attributable to shareholders' equity of the parent company
Non-controlling
interests
Total
Share capital
Capital reserve
Less:
treasury
shares
Other
comprehensive
income
Specific
reserve
Surplus reserve
Retained
earnings
I.Balance at the year ended 1011660000.00 978244910.11 - 10564385.97 - 95906222.59 1235884122.72 -131524530.88 3200735110.51
Add：Changes in accounting policies - - - 10093435.70 - -416151.43 -25355845.72 -390720.82 -16069282.27
Correction of prior period errors
Business combination involving enterprises under common control
Others -
II.Balance at the beginning of the year 1011660000.00 978244910.11 - 20657821.67 - 95490071.16 1210528277.00 -131915251.70 3184665828.24
III.Changes in equity during the year( "- "for decrease) - - - 173182.46 - 95732767.78 254387539.81 -9976084.14 340317405.91
(I)Total comprehensive income - - - 173182.46 - - 552452307.59 -11605082.08 541020407.97
(II)Shareholders' contributions and decrease of capital - - - - - - - - -
1.Contribution by ordinary shareholders -
2.Capital contributed by the holders of other equity instrument -
3. Equity settled share-based payments -
4. Others -
(III) Appropriation of profits - - - - - 95732767.78 -298064767.78 - -202332000.00
1. Appropriation for surplus reserves - - - - - 95732767.78 -95732767.78 - -
2. Appropriation for general risk reserve
3. Distributions to shareholders -202332000.00 -202332000.00
4. Others -
(IV) Transfer within equity - - - - - - - - -
1.Share capital increased by capital reserves transfer -
2.Share capital increased by surplus reserves transfer -
3.Transfer of surplus reserve to offset losses -
4.Others -
(V)Specific Reserve - - - - - - - - -
1. Appropriation during the year -
2.Utilisation during the year ("- ") -
(VI)Others 1628997.94 1628997.94
IV.Balance at the year ended 1011660000.00 978244910.11 - 20831004.13 - 191222838.94 1464915816.81 -141891335.84 3524983234.15
Legal representative: Person in charge of accounting: Person in charge of accounting organ:
Company's Statement of Changes in Shareholders' Equity
For the year ended 31 December 2020
Prepared by：Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd
Expressed in RMB
Item
Year ended 31/12/2020
Share capital
Capital
reserve
Less: treasury
shares
Other
comprehensive
income
Specific
reserve
Surplus
reserve
Retained
earnings
Total
I.Balance at the year ended 1011660000.00 964711931.13 - 922125.77 - 168093225.53 1280197219.96 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 1280197219.96 3425584502.39
III.Changes in equity during the year( "- "for
decrease)
- - - 209025.97 - 27501434.73 80589012.57 108299473.27
(I)Total comprehensive income
209025.97
275014347.30 275223373.27
(II)Shareholders' contributions and decrease of capital - - - - - - - -
1.Ordinary shares by shareholders
-
2. Contribution by other equity instruments holders
-
3. Equity settled share-based payments
-
4. 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 transfer
-
2.Share capital increased by surplus reserves transfer
-
3.Transfer of surplus reserve to offset losses
-
4. Retained earnings transfered by other
comprehensive income
-
5.Others
-
(V)Specific Reserve - - - - - - - -
1. Appropriation during the year
-
2.Utilisation during the year
-
(VI)Others
-
IV.Balance at the year ended 1011660000.00 964711931.13 - 1131151.74 - 195594660.26 1360786232.53 3533883975.66
Legal representative: Person in charge of accounting: Person in charge of accounting organ:
Company's Statement of Changes in Shareholders' Equity
For the year ended 31 December 2020
Prepared by：Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd Expressed in RMB
Item
Year ended 31/12/2019
Share capital Capital reserve
Less:
treasury
shares
Other
comprehensi
ve income
Specific
reserve
Surplus reserve Retained earnings Total
I.Balance at the year ended 1011660000.00 964711931.13
72776609.18 615038028.05 2664186568.36
Add：Changes in accounting policies
972892.24
-416151.43 -4072924.18 -3516183.37
Correction of prior period errors
-
Others
9969206.09 9969206.09
II.Balance at the beginning of the year 1011660000.00 964711931.13 - 972892.24 - 72360457.75 620934309.96 2670639591.08
III.Changes in equity during the year( "- "for decrease) - - - -50766.47 - 95732767.78 659262910.00 754944911.31
(I)Total comprehensive income
-50766.47
957327677.78 957276911.31
(II)Shareholders' contributions and decrease of capital - - - - - - - -
1.Ordinary shares by shareholders
-
2. Contribution by other equity instruments holders
-
3. Equity settled share-based payments
-
4. Others
-
(III) Appropriation of profits - - - - - 95732767.78 -298064767.78 -202332000.00
1. Appropriation for surplus reserves
95732767.78 -95732767.78 -
2. Distributions to shareholders
-202332000.00 -202332000.00
3. Others
-
(IV) Transfer within equity - - - - - - - -
1.Share capital increased by capital reserves transfer
-
2.Share capital increased by surplus reserves transfer
-
3.Transfer of surplus reserve to offset losses
-
4. Retained earnings transfered by other comprehensive income
5.Others
-
(V)Specific Reserve - - - - - - - -
1. Appropriation during the year
-
2.Utilisation during the year
-
(VI)Others
-
IV.Balance at the year ended 1011660000.00 964711931.13 - 922125.77 - 168093225.53 1280197219.96 3425584502.39
Legal representative: Person in charge of accounting: Person in charge of accounting organ:
Notes to the Financial Statements
I.Company general information
1. Company’s profile
Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd. (the “Group” or “the
Company”) is a listed company in main board and was established in July 1993 as approved by the
Shenzhen Municipal Government with document SFBF (1993) 724. The company was restructured on
the basis of the former Shenzhen Special Economic Zone Real Estate Corporation and has been
approved and registered by the Shenzhen Municipal Administration for Industry and Commerce of
Guangdong Province. The unified social credit code of the company is 91440300192179585N and the
registered capital of the Company is RMB 1011660000.00. 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’s headquarter is at Floor 45-48 Shen Fang Plaza Ren Min South Road Luo Hu District
Shen Zhen Guang Dong province.
On 13 October 2004，according to the document No.(2004) 223 “Decision on establishing Shenzheninvestment Holding Co. Ltd.” issued by State-Owned Assets Supervision and Administration
Commission of Shenzhen Municipal Government former major shareholder – Shenzhen Construction
Investment Holding Company with two other assets management companies merged to form the
Shenzhen Investment Holding Co. Ltd. By the State-owned Assets Supervision and Administration
Commission of the state council and quasi-exempt obligations tender offer as approved by China
Security Regulatory Committee with document No. (2005)116 this issue of consolidated has been
authorized and the change in registration had been completed on 15 February 2006. At the end of the
reporting period Shenzhen Investment Holding Limited holds 642884262 shares of the Company
(63.55% of the total share capital). The shares are all tradable unrestricted shares.
The Company has established the corporate governance structure of the general meeting of
shareholders the board of directors and board of supervisors. with human resources department
financing plan department marketing department engineering management department and etc in
place.The Company and its subsidiaries (hereinafter referred to as "the Group") are principally engaged in
real estate development and sales property leasing and management retail merchandising and trade
hotel equipment installation and maintenance construction interior decoration etc.The consolidated and company financial statements and the notes to financial statements have been
approved by the 7th Board of Directors in the 60th board meeting on 19 March 2021.
2. Scope of consolidated financial statements
For details please refer to “1. Interests in subsidiaries” in Note VII ”Interests in other entities”..
In this reporting period the change of consolidation scope is shown in Notes VI and VII for more
details.
II.Basis of preparation
The financial statements are prepared in accordance with the Accounting Standards for Business
Enterprises and corresponding application guidance interpretations and other related provisions
issued by the Ministry of Finance (collectively " Accounting Standards for Business Enterprises "). In
addition the Group also discloses relevant financial information in accordance with the rules of
information disclosure for publicly issued securities companies No. 15 - general provisions on financial
reporting (revised in 2014) of the China securities regulatory commission.The financial statements of the Company have been prepared on going concern basis.The Company adopts the accrual basis of accounting. Except for certain financial instruments the
financial statements are prepared under the historical cost convention. In the event that impairment of
assets occurs a provision for impairment is made accordingly in accordance with the relevant
regulations.III.Significant accounting policies and accounting estimates
The Group determines the revenue recognition policy according to its own production and operation
characteristics.The specific accounting policy please refer to Note III.23 .
1. Statement of compliance with the Accounting Standards for Business Enterprises
The financial statements have been prepared in compliance with the Accounting Standards for
Business Enterprises to truly and completely present the Company and consolidated financial position
as at 31 December 2020 and the Company and consolidated operating results and cash flows for the
year ended 31 December 2020.
2. Accounting Period
The accounting period of the Company is from 1 January to 31 December.
3. Operating Period
The operating period of the Company is 12 months.
4. Functional currency
The Company and domestic subsidiaries use Renminbi (“RMB”) as their functional currency. Offshore
subsidiariesAmerican Great Wall Co. Ltd. determine USD as their functional currency according to
the primary economic environment where they operate. The financial statements of the Company have
been prepared in RMB.
5. Accounting treatments for business combinations involving enterprises under common control and not
under common control
(1) Business combinations involving enterprises under common control
For a business combination involving enterprises under common control the assets acquired and
liabilities assumed are measured based on their carrying amounts in the consolidated financial
statements of the ultimate controlling party at the combination date except for adjustments due to
different accounting policies. The difference between the carrying amount of the net assets acquired
and the consideration paid for the combination (or the total par value of shares issued) is adjusted
against share premium in the capital reserve with any excess adjusted against retained earnings.
Business combinations involving enterprises under common control and achieved in stages.
In the separate financial statements the initial investment cost is calculated based on the shareholding
portion of the assets and liabilities obtained and are measured at the carrying amounts as recorded by
the enterprise being combined at the combination date. The difference between the initial investment
cost and the sum of the carrying amount of the original investment cost and the carrying amount of
consideration paid for the combination is adjusted to the capital reserve if the capital reserve is not
sufficient to absorb the difference the excess difference shall be adjusted to retained earning.In the consolidated financial statements the assets and liabilities obtained at the combination shall be
measured at the carrying value as recorded by the enterprise at combination date except for
adjustments of different accounting policies. The difference between the sum of the carrying value
from original shareholding portion and the new investment cost incurred at combination date and the
carrying value of net assets obtained at combination date shall be adjusted to capital reserve if the
balance of capital reserve is not sufficient to absorb the differences any excess is adjusted to retained
earnings. The long-term investment held by the combination party the recognized profit or lose
comprehensive income and other change of shareholding’s equity at the closer date of the acquisition
date and combination date under common control shall separately offset the opening balance of
retained earnings and profit or loss during comparative statements.
(2) Business combinations involving enterprises not under common control
For business combinations involving enterprises not under common control the consideration costs
include acquisition-date fair value of assets transferred liabilities incurred or assumed and equity
securities issued by the acquirer in exchange for control of the acquiree. At the acquisition date the
acquired assets liabilities and contingent liabilities of the acquiree are measured at their fair value.The acquiree’s identifiable asset liabilities and contingent liabilities are recognised at their
acquisition-date fair value.Where the combination cost exceeds the acquirer’s interest in the fair value of the acquiree’s
identifiable net assets the difference is recognised as goodwill and subsequently measured on the
basis of its cost less accumulated impairment provisions. Where the combination cost is less than the
acquirer’s interest in the fair value of the acquiree’s identifiable net assets the difference is recognised
in profit or loss for the current period after reassessment.
Business combinations involving enterprises not under common control and achieved in stages
In the separate financial statements the initial investment cost of the investment is the sum of the
carrying amount of the equity investment held by the entity prior to the acquisition date and the
additional investment cost at the acquisition date. The disposal accounting policy of other
comprehensive income related with equity investment prior to the purchase date recognized under
equity method shall be compliance with the method when the acquiree disposes the related assets or
liabilities. Shareholder’s equity due to the changes of other shareholder’s equity other than the
changes of net profit other comprehensive income and profit distribution shall be transferred to profit
or lose for current period when disposed. If the equity investment held by the entity prior to the
acquisition date is measured at fair value the cumulative changes in fair value recognized in other
comprehensive income shall be transferred to profit or loss for current period when accounted for
using cost method.In the consolidation financial statements the combination cost is the sum of consideration paid at
acquisition date and fair value of the acquiree’s equity investment held prior to acquisition date; the
cost of equity of the acquiree held prior to acquisition date shall be re-measured at the fair value at
acquisition date the difference between the fair value and book value shall be recognized as
investment income or loss for the current period. Other comprehensive income and changes of
investment equity related with acquiree’s equity held prior to acquisition date shall be transferred to
investment profit or loss for current period at acquisition date besides there is other comprehensive
income incurred by the changes of net assets or net liabilities due to the re-measurement of defined
benefit plan.
(3) Transaction costs for business combination
The overhead for the business combination including the expenses for audit legal services valuation
advisory and other administrative expenses are recorded in profit or loss for the current period when incurred.The transaction costs of equity or debt securities issued as the considerations of business combination
are included in the initial recognition amount of the equity or debt securities.
6. Consolidated financial statements
(1) Scope of consolidated financial statements
The scope of consolidated financial statements is based on control. Control exists when the Company
has power over the investee; exposure or rights to variable returns from its involvement with the
investee and has the ability to affect its returns through its power over the investee. A subsidiary is an
entity that is controlled by the Company (including enterprise a portion of an investee as a deemed
separate component and structured entity controlled by the enterprise).
(2) Basis of preparation of consolidated financial statements
The consolidated financial statements are prepared by the Company based on the financial statements
of the Company and its subsidiaries and other relevant information. When preparing consolidated
financial statements the accounting policies and accounting periods of the subsidiaries should be
consistent with those established by the Company and all significant intra-group balances and
transactions are eliminated.Where a subsidiary or business was acquired during the reporting period through a business
combination involving enterprises under common control the financial statements of the subsidiary or
business are included in the consolidated financial statements as if the combination had occurred at
the date that the ultimate controlling party first obtained control.Where a subsidiary or business was acquired during the reporting period through a business
combination involving enterprises not under common control the identifiable assets and liabilities of
the acquired subsidiaries or business are included in the scope of consolidation from the date that
control commences.The portion of a subsidiary’s equity that is not attributable to the parent is treated as non-controlling
interests and presented separately in the consolidated balance sheet within shareholders’ equity. The
portion of net profit or loss of subsidiaries for the period attributable to non-controlling interests is
presented separately in the consolidated income statement below the “net profit” line item. When the
amount of loss for the current period attributable to the non-controlling shareholders of a subsidiary
exceeds the non-controlling shareholders’ share of the opening owners’ equity of the subsidiary the
excess is still allocated against the non-controlling interests.
(3) Changes in non-controlling interests
Where the Company acquires a non-controlling interest from a subsidiary’s non-controlling
shareholders or disposes of a portion of an interest in a subsidiary without a change in control the
transaction is treated as equity transaction and the book value of shareholder’s equity attributed to the
Company and to the non-controlling interest is adjusted to reflect the change in the Company’s interest
in the subsidiaries. The difference between the proportion interests of the subsidiary’s net assets being
acquired or disposed and the amount of the consideration paid or received is adjusted to the capital
reserve in the consolidated balance sheet with any excess adjusted to retained earnings.
(4) Disposal of subsidiaries
When the Company loses control over a subsidiary because of disposing part of equity investment or
other reasons the remaining part of the equity investment is re-measured at fair value at the date
when the control is lost. A gain or loss is recognised in the current period and is calculated by the
aggregate of consideration received in disposal and the fair value of remaining part of the equity
investment deducting the share of net assets in proportion to previous shareholding percentage in the
former subsidiary since acquisition date and the goodwill.Other comprehensive income related to the former subsidiary is transferred to profit or loss when the
control is lost except for the comprehensive income arising from the movement of net liabilities or
assets in the former subsidiary’s re-measurement of defined benefit plan.
7. Joint arrangement classification and accounting treatment for joint operation
A joint arrangement is an arrangement of which two or more parties have joint control. The Company
classifies joint arrangements into joint operations and joint ventures.
(1) Joint operations
A joint operation is a joint arrangement whereby the joint operators have rights to the assets and
obligations for the liabilities relating to the arrangement.The Company recognizes the following items relating to its interest in a joint operation and account for
them in accordance with relevant accounting standards:
A、its solely-held assets and its share of any assets held jointly;
B、its solely-assumed liabilities and its share of any liabilities assumed jointly;
C、its 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 Company adopts equity method under long-term equity investment in accounting for its
investment in joint venture.
8. Cash and cash equivalents
Cash comprises cash in hand and deposits that can be readily withdrawn on demand. Cash
equivalents include short-term highly liquid investments that are readily convertible to known amounts
of cash and are subject to an insignificant risk of change in value.9. Foreign currency transactions and translation of foreign currency financial statements
(1)Foreign currency transactions
Foreign currency transactions are translated to the functional currency of the Company at the spot
exchange rates on the dates of the transactions.Monetary items denominated in foreign currencies are translated to Renminbi at the spot exchange rate
at the balance sheet date. The resulting exchange differences between the spot exchange rate on
balance sheet date and the spot exchange rate on initial recognition or on the previous balance sheet
date are recognised in profit or loss. Non-monetary items that are measured at historical cost in foreign
currencies are translated to Renminbi using the exchange rate at the transaction date. Non-monetary
items that are measured at fair value in foreign currencies are translated using the exchange rate at the
date the fair value is determined. The resulting exchange differences are recognised in profit or loss.
(2)Translation of foreign currency financial statements
When translating the foreign currency financial statements of overseas subsidiaries assets and
liabilities of foreign operation are translated to Renminbi at the spot exchange rate at the balance
sheet date. Equity items excluding “retained earnings” are translated to Renminbi at the spot
exchange rates at the transaction dates.Income and expenses of foreign operation are translated to Renminbi at the spot exchange rates at
the transaction dates.
Cash flow statement of foreign operation is translated to Renminbi at the spot exchange rates [the
rates determined under a systematic and rational method that approximate the spot exchange rates] at
the cash flow 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
Financial instruments refer to the contracts of forming enterprise financial assets and other entities’
financial liabilities or equity instruments.
(1) Recognition and Derecognition of financial instruments
A financial asset or financial liability is recognised when the Group becomes one party of financial
instrument contracts.If one of the following conditions is met the financial assets are terminated:
① The right of the contract to receive the cash flows of financial assets terminates
② The financial asset has been transferred and is in accordance with the following conditions for
derecognition.If the obligations of financial liability have been discharged in total or in part derecognize all or part of
it. If the Group (debtor) makes an agreement with the creditor to replace the current financial liability of
assuming new financial liability which contract provisions are different in substance derecognize the
current financial liability and meanwhile recognize as the new financial liability.If the financial assets are traded routinely they are recognised and derecognised at the transaction date.
(2) Classification and measurement of financial assets
Financial assets are classified into the following three categories depends on the Group’s business
mode of managing financial assets and cash flow characteristics of financial assets: financial assets
measured at amortized cost financial assets at fair value through other comprehensive income and
financial assets at fair value through profit or loss.
Financial assets measured at amortised cost
The Group shall classify financial assets that meet the following conditions and are not designated as
financial assets at fair value through profit or loss as financial assets measured at amortized cost:
? The Group’s business model for managing the financial assets is to collect contractual cash flows;
? The terms of the financial asset contract stipulate that cash flows generated on a specific date are
only payments of principal and interest based on the amount of outstanding principal.
After initial confirmation the real interest rate method is used to measure the amortized cost of such
financial assets. Profits or losses arising from financial assets measured at amortized costs and not
part of any hedging relationship are included in current profits and losses when the recognition is
terminated amortized or impaired according to the Actual Interest Rate Law.
Financial assets at fair value through other comprehensive income
The Group shall classify financial assets that meet the following conditions and are not designated as
financial assets measured at fair value and whose changes are recorded in current profits and losses
as financial assets measured at fair value through other comprehensive income:
? The Group’s business model for managing the financial assets is both to collect contractual cash
flows and to sell the financial assets;
? The terms of the financial asset contract stipulate that cash flows generated on a specific date are
only payments of principal and interest based on the amount of outstanding principal.
After initial recognition financial assets are subsequently measured at fair value. Interest impairment
losses or gains and exchange gains calculated by the effective interest rate method are recognised in
profit or loss while other gains or losses are recognised in other comprehensive gains. When
derecognized the accumulated gains or losses previously recognised in other comprehensive gains
are transferred from other comprehensive gains and recorded in current profits and losses.
Financial assets at fair value through profit or loss
In addition to the aboving financial assets which are measured at amortized cost or at fair value
through other comprehensive income the Group classifies all other financial assets as financial assets
measured at fair value through profit or loss.When initial recognition in order to eliminate or
significantly reduce accounting mismatches the Group irrevocably designates some financial assets
that should have been measured at amortized cost or at fair value through other comprehensive gains
as financial assets at fair value through profit or loss.
After initial recognition the financial assets are subsequently measured at fair value and the profits or
losses (including interest and dividend income) generated from which are recognised in profit or loss
unless the financial assets are part of the hedging relationship.However for non-tradable equity instrument investment when initially recognized the Group
irrevocably designates them as financial assets at fair value through other comprehensive gains. The
designation is made on the basis of individual investment and the relevant investment conforms to the
definition of equity instruments from the issuer’s point of view.
After initial confirmation financial assets are subsequently measured at fair value. Dividend income
that meets the requirements is recognised in profit and loss and other gains or losses and changes in
fair value are recognised in other comprehensive gains. When derecognized the accumulated gains or
losses previously recognised in other comprehensive gains are transferred from other comprehensive
gains to retained earnings.The business model of managing financial assets refers to how the group manages financial assets to
generate cash flow. The business model decides whether the source of cash flow of financial assets
managed by the Group is to collect contract cash flow sell financial assets or both of them. Based on
objective facts and the specific business objectives of financial assets management decided by key
managers the Group determines the business model of financial assets management.The Group evaluates the characteristics of the contract cash flow of financial assets to determine
whether the contract cash flow generated by the relevant financial assets on a specific date is only
to pay principal and interest based on the amount of unpaid principal. Among them principal refers
to the fair value of financial assets at the time of initial confirmation; interest includes the
consideration of time value of money credit risk related to the amount of unpaid principal in a
specific period and other basic borrowing risks costs and profits. In addition the Group evaluates
the terms and conditions of the contracts that may lead to changes in the time distribution or amount
of cash flow in financial asset contracts to determine whether they meet the requirements of the
aboving contract cash flow’s. characteristics
Only when the Group changes its business model of managing financial assets all the financial assets
affected shall be reclassified on the first day of the first reporting period after the business model
changes otherwise financial assets shall not be reclassified after initial confirmation.
Financial assets are measured at fair value at initial recognition. For financial assets that are measured
at fair value and whose changes are included in the current profit and loss related transaction costs
are directly included in the current profit and loss; for other types of financial assets related transaction
costs are included in the initially recognized amount. For accounts receivable arising from the sale of
products or the provision of labor services that do not include or take into account significant financing
components the Group considers the amount of consideration expected to be entitled as the initial
recognition amount.
(3) Classification and Measurement of financial liabilities
On initial recognition financial liabilities are classified as: financial liabilities at fair value through profit
or loss (FVTPL) and financial liabilities measured at amortized cost. For financial liabilities not
classified as at fair value through profit or loss the transaction costs are recognised in the initially
recognised amount.
Financial liabilities at fair value through profits and losses
Financial liabilities at FVTPL include transaction financial liabilities and financial liabilities designated
as at fair value through profit or loss in the initial recognition. Such financial liabilities are subsequently
measured at fair value all gains and losses arising from changes in fair value and dividend and
interest expense relative to the financial liabilities are recognised in profit or loss for the current period.
Financial liabilities measured at amortized cost
Other financial liabilities are subsequently measured at amortized cost using the effective interest
method; gains and losses arising from derecognition or amortization is recognised in profit or loss for
the current period.
Distinction between financial liabilities and equity instruments
The financial liability is the liability that meets one of following criterias:
① Contractual obligation to deliver cash or other financial instruments to another entity.
② Under potential adverse condition contractual obligation to exchange financial assets or financial
liabilities with other parties.
③ A contract that will or may be settled in the entity’s own equity instruments and is a
non-derivative for which the entity is or may be obliged to deliver a variable number of the entity’s
own equity instruments.
④ A derivative that will or may be settled other than by the exchange of a fixed amount of cash or
another financial asset for a fixed number of the entity’s own equity instruments.
An equity instrument is any contract that evidences a residual interest in the assets of an entity after
deducting all of its liabilities.If the group cannot unconditionally avoid fulfilling a contractual obligation by delivering cash or other
financial assets the contractual obligation meets the definition of financial liability.If a financial instrument must or are able to be settled by the group’s own equity instrument the group
should consider whether the group’s equity instrument as the settlement instrument is a substitute of
cash or other financial assets or the residual interest in the assets of an entity after deducting all of its
liabilities. If the former the tool is the group’s financial liability; if the latter the tool is the equity
instrument of the group.
(4) Fair value of financial instruments
The recognization of fair value of financial assets and financial liability is set out in note III.11.
(5) Impairment of financial assets
On the basis of expected credit losses the Group performs impairment assessment on the following
items and confirms the loss provision.? financial assets measured at amortized cost;
? debt investments at fair value through other comprehensive income;
? contractual assets as defined in Enterprise Accounting Standards No. 14 - Revenue;
? lease receivables;
? Financial guarantee contract (except measured at fair value through profit or loss or formed by
continuing involvement of transferred financial assets or the transfer does not qualify for
derecognition).Measurement of expected credit losses
The expected credit losses refers to the weighted average of the credit losses of financial instruments
that are weighted by the risk of default. Credit loss refers to the difference between all contractual cash
flows receivable from the contract and all cash flows expected to be received by the Group at the
original effective interest rate that is the present value of all cash shortages.The company considers reasonable and reliable information about past events current conditions
future forecasts and weights the risk of default to calculate the probability-weighted amount of the
present value of the difference between the cash flow receivable under the contract and the cash flow
expected to be received in recognition of the expected credit loss.The Group separately measures the expected credit losses of financial instruments at different stages.The credit risk on a financial instrument has not increased significantly since initial recognition which is
in the first stage. The Group shall measure the loss allowance for that financial instrument at an
amount equal To 12-month expected credit losses. If the credit risk of financial instruments has
increased significantly since the initial recognition but no credit impairment has occurred which is in
the second stage. The Group shall measure the loss allowance for a financial instrument at an amount
equal to the lifetime expected credit losses. If the financial instrument has occurred credit impairment
since initial recognition which is in the third stage and the Group shall measure the loss allowance for
a financial instrument at an amount equal to the lifetime expected credit losses.
For financial instruments with lower credit risk at the balance sheet date the Group assumes that their
credit risk has not increased significantly since the initial recognition and shall measure the loss
allowance for that financial instrument at an amount equal to 12-month expected credit losses.The lifetime expected credit lossesrefer to the expected credit losses caused by all possible defaults
during the whole expected lifetime. The 12-month expected credit lossesrefer to the expected credit
losses caused by all possible defaults during the 12-month after balance sheet date(if the expected
duration of financial instrument is less than 12 months then for the expected duration)which is part of
the lifetime expected credit losses.When measure the expected credit loss the longest contract period (including the option of renewal)
that the group needs to consider is the longest contract period the enterprise facing credit risk.
For financial instruments in the first stagessecond stages and with lower credit risk the Group
calculates interest income on the basis of their book balances without deduction of impairment
provisions and actual interest rates. For financial instruments in the third stage the Group calculates
interest income according to their book balance minus the impairment provision and the actual
interest rate.For bills receivable and accounts receivable whether or not there are significant financing elements
the Group shall always measure the loss allowance for them at an amount equal to the lifetime
expected credit losses.When information on expected credit losses cannot be assessed for a single financial asset in
accordance with the characteristics of credit risk the group divides and combines bills receivable
accounts receivable and leased receivables. On the basis of the combination the group calculates the
expected credit losses. The basis of determining the combination is as follows:
A﹑ Bills receivable
? Bill receivable group 1: Bank acceptance bills
? Bill receivable group 2: Commercial acceptance bills
B﹑ Accounts receivable
? Accounts receivable group 1: Amount receivables of related parties
? Accounts receivable group 2: Amount receivables of sales of properties
? Accounts receivable group 3: Amount receivables of other customers
C﹑ Contract Asset
? Contract Asset group 1: Product sales
? Contract Asset group 2: the Construction of the project
For the accounts receivable divided into group the group refers to the historical credit losses
combines the current situation with the forecast of future economic situation compiles a comparison
table between the age of accounts receivable and the lifetime expected credit losses rate to calculate
the expected credit losses.
For the bills receivables and contract assets divided into group the Group refers to historical credit
losses with the current situation and the forecast of future economic situation calculates the expected
credit losses through the exposure on default and the lifetime expected credit losses rate.Other receivables
According to the characteristics of credit risk the group divides other receivables into group. On the
basis of the combination the group calculates the expected credit losses. The basis of determining the
combination is as follows:
? Other receivables group 1: Amount receivables from government.? Other receivables group 2: Amount receivables from petty cash.? Other receivables group 3: Amount receivables from the collecting and paying on another's behalf.? Other receivables group 4: Amount receivables from current accounts.? Other receivables group 5: Amount receivables from related parties.For other receivables a divided into group the Group calculates the expected credit losses through the
exposure on default and the lifetime expected credit losses rate or the next 12 months.
Debt investments and Other debt investments
For debt investments and other debt investments the group calculates the expected credit losses
through the exposure on default and the future 12-month or lifetime expected credit losses rate
according to the nature of the investment the types of counterparty and risk exposure.
Assessment of Significant Increase in Credit Risk
By comparing the default risk of financial instruments on balance sheet day with that on initial
recognition day the Group determines the relative change of default risk of financial instruments
during the expected life of financial instrumentsto evaluate whether the credit risk of financial
instruments has increased significantly since the initial recognition.To determine whether credit risk has increased significantly since the initial recognition. the Group
considers reasonable and valid information including forward-looking information that can be obtained
without unnecessary additional costs or efforts. Information considered by the Group includes:
? The debtor can’t pay principal and interest on the expiration date of the contract;
? Serious deterioration of external or internal credit ratings (if any) of financial instruments that have
occurred or are expected to occur;
? Serious deterioration of the debtor’s operating results that have occurred or are expected to occur;
? Changes in the existing or anticipated technological market economic or legal environment will
have a significant negative impact on the debtor’s repayment capacity.
According to the nature of financial instruments the Group evaluates whether credit risk has increased
significantly on the basis of a single financial instrument or a combination of financial instruments.When assessing on the basis of the combination of financial instruments the Group can classify
financial instruments based on common credit risk characteristics such as overdue information and
credit risk rating.If the delay exceeds 30 days the Group determines that the credit risk of financial instruments has
increased significantly.The Group considers that financial assets default in the following circumstances
? The debtor is unlikely to full pay its arrears to the group and the assessment does not take into
account recourse actions taken by the group such as liquidation of collateral (if held);
? Financial assets have delay more than 90 days.
Financial assets that have occured credit impairment
On the balance sheet date the Group assesses whether credit impairment has occurred in financial
assets measured at amortized cost and debt investments measured at fair value through other
comprehensive income. When one or more events adversely affect the expected future cash flow of a
financial asset occur the financial asset becomes a financial asset with credit impairment. Evidence of
credit impairment of financial assets includes the following observable information:
? Significant financial difficulties occurs to the issuer or debtor;
? The debtor breaches any of the contractual stipulations for example fails to pay or delays the
payment of interests or the principal etc.;
? For economic or contractual considerations related to the financial difficulties of the debtor the
Group grants concessions to the debtor that will not be made under any other circumstances.? The debtor is probable to go bankrupt or undergo other financial restructuring.
? Financial difficulties of issuer or debtor lead to the disappearance of financial assets active market.
Presentation of expected credit losses reserve
In order to reflect the changes happened to the credit risk of financial instruments since the initial
recognition the Group recalculates the expected credit losses on each balance sheet day. The
increase or reversal of the loss provision resulting therefrom is recognised as an impairment loss or
gain in the current profit or loss.For financial assets measured at amortized cost loss provision offsets
the carrying amount of the financial assets shown on the balance sheet; for debt investments
measured at fair value through other comprehensive income the Group recognizes its loss provision
through other comprehensive income and does not offset the financial assets’ carrying amount.Write off
If the Group no longer reasonably expects that the financial assets contract cash flow can be
recovered fully or partially the financial assets book balance will be reduced directly. Such reduction
constitute the derecognition of the financial assets. What usually occurs when the Group determines
that the debtor has no assets or sources of income to generate sufficient cash flows to pay the amount
to be reduced. However in accordance with the Group’s procedures for recovering due payment the
financial assets reduced may still be affected by enforcement activities.If the reduced financial assets are recovered later the returns as impairment losses shall be included
in the profits and losses of the recovery period.
(6) Transfer of financial assets
Transfer of financial assets refers to the transference or deliverance of financial assets to the other
party (the transferee) other than the issuer of financial assets.The Group derecognizes a financial asset only if it transfers substantially all the risks and rewards of
ownership of the financial asset to the transferee; the Group should not derecognize a financial asset if
it retains substantially all the risks and rewards of ownership of the financial asset.The Group neither transfers nor retains substantially all the risks and rewards of ownership shows as
the following circumstances: if the Group has forgone control over the financial assets derecognize
the financial assets and verify the assets and liabilities; if the Group retains its control of the financial
asset the financial asset is recognized to the extent of its continuing involvement in the transferred
financial asset and recognize an associated liability is recognized.
(7) Offseting financial assets and financial liabilities
When the Group has the legal rights to offset the recognized financial assets and financial liabilities
and is capable to carry it out the Group plans to net settlement or realize the financial assets and pay
off the financial liabilities the financial assets and financial liabilities shall be listed separately with the
neutralized amount in balance sheet and are not allowed to be offset.
11. Fair value measurement
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date.The Company measures related assets or liabilities at fair value assuming the assets or liabilities are
exchanged in an orderly transaction in the principal market; in the absence of a principal market assuming
the assets or liabilities are exchanged in an orderly transaction in the most advantageous market. Principal
market (or the most advantageous market) is the market that the Company can normally enter into a
transaction on measurement date. The Company adopts the presumptions that would be used by market
participants in achieving the maximized economic value of the assets or liabilities.
For financial assets or financial liabilities with active markets the Company uses the quoted prices in
active markets as their fair value. Otherwise the Company uses valuation technique to determine their
fair value.
Fair value measurement of a non-financial asset takes into account market participants’ ability to
generate economic benefits using the asset in its best way or by selling it to another market participant
that would best use the asset.The Company uses valuation techniques that are appropriate in the circumstances and for which
sufficient data are available to measure fair value maximizing the use of relevant observable inputs
and using unobservable inputs only if the observable inputs aren’t available or impractical.
Fair value level for assets and liabilities measured or disclosed at fair value in the financial statements
are determined according to the significant lowest level input to the entire measurement: Level 1 inputs
are quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company can
access at the measurement date; Level 2 inputs are inputs other than quoted prices included within
Level 1 that are observable for the assets or liabilities either directly or indirectly; Level 3 inputs are
unobservable inputs for the assets or liabilities.
At the balance sheet date the Company revalues assets and liabilities being measured at fair
value continuously in the financial statements to determine whether to change the levels of fair
value measurement.
12. Inventories
(1) Classification
The Group's inventory is classified by real estate development and non-real estate development.Inventory is mainly for real estate developmentincluding development costs and development
productes.Development cost include the development costs of development products to be developed
and development products under construction. Development products includes completed
development products and intended to sell but temporarily leased development products. Non-real
estate developments include raw materials finished gooods and construction.
(2) Mesurement method of cost of inventories
Inventories are initially measured at cost. The cost of product development includes land transfer fee
infrastructure expenditure construction and installation project expenditure borrowing expenses
incurred before the completion of the development project and other related expenses in the
development process. When a product is developed and shipped the actual cost is determined by
specific identification method..Raw materials and finished goods are calculated using weighted average method.
(3)Basis for determining the net realisable value and method for provision for obsolete inventories
Net realisable value is the estimated selling price in the ordinary course of business less the estimated
costs of completion and the estimated costs necessary to make the sale and relevant taxes. The net
realisable value is measured based on the verified evidences and considerations for the purpose of
holding inventories and the effect of post balance sheet events.
Any excess of the cost over the net realisable value of of inventories is recognised as a provision for
obsolete inventories and is recognised in profit or loss. The Company usually recognises provision for
decline in value of inventories by a single inventory item. If the factors caused the value of inventory
previously written-down have disappeared the provision for decline in value of inventories previously
made is reversed.
(4)Inventory count system
The Company maintains a perpetual inventory system.
(5)Amortization methods of low-value consumables and packaging materials
Low-value consumables are charged to profit or loss when they are used.
13. Long-term equity investments
Long-term equity investments include equity investments in subsidiaries and equity investments in joint
ventures and associates. An associate is an enterprise over which the Company has significant
influence.
(1)Determination of initial investment cost
The initial cost of a long-term equity investment acquired through a business combination involving
enterprises under common control is the Company’s share of the carrying amount of the subsidiary’s
equity in the consolidated financial statements of the ultimate controlling party at the combination date.
For a long-term equity investment obtained through a business combination not involving enterprises
under common control the initial cost is the combination cost.
A long-term equity investment acquired other than through a business combination: A long-term equity
investment acquired other than through a business combination is initially recognised at the amount of
cash paid if the Company acquires the investment by cash or at the fair value of the equity securities
issued if an investment is acquired by issuing equity securities.
(2) Subsequent measurement and recognition of profit or loss
Long-term equity investments in subsidiaries are accounted for using the cost method. An investment
in a joint venture or an associate is accounted for using the equity method for subsequent
measurement.For a long-term equity investment which is accounted for using the cost method Except for cash
dividends or profit distributions declared but not yet distributed that have been included in the price or
consideration paid in obtaining the investments the Company recognises its share of the cash
dividends or profit distributions declared by the investee as investment income for the current period.
For a long-term equity investment which is accounted for using the equity method where the initial
cost of a long-term equity investment exceeds the Company’s interest in the fair value of the investee’s
identifiable net assets at the date of acquisition the investment is initially recognised at cost. Where
the initial investment cost is less than the Company’s interest in the fair value of the investee’s
identifiable net assets at the date of acquisition the investment is initially recognised at the investor’s
share of the fair value of the investee’s identifiable net assets and the difference is recognised in profit
or loss.Under the equity method the Company recognises its share of the investee’s profit or loss and other
comprehensive income as investment income or losses and other comprehensive income respectively
and adjusts the carrying amount of the investment accordingly. Once the investee declares any cash
dividends or profit distributions the carrying amount of the investment is reduced by the amount
attributable to the Company. Changes in the Company’s share of the investee’s owners’ equity other
than those arising from the investee’s net profit or loss other comprehensive income or profit
distribution (referred to as “other changes in owners’ equity”) is recognised directly in the Company’s
equity and the carrying amount of the investment is adjusted accordingly. In calculating its share of
the investee’s net profits or losses other comprehensive income and other changes in owners’ equity
the Group recognises investment income and other comprehensive income after making appropriate
adjustments to align the accounting policies or accounting periods with those of the Group based on
the fair value of the investee’s identifiable net assets at the date of acquisition.When the Company becomes capable of exercising joint control or significant influence (but not control)
over an investee due to additional investment or other reasons the Company uses the fair value of the
previously-held equity investment together with additional investment cost as the initial investment
cost under the equity method. The difference between the fair value and carrying amount of the
previously-held equity investment and the accumulated changes in fair value included in other
comprehensive income shall be transferred to profit or loss for the current period upon
commencement of the equity method.When the Company can no longer exercise joint control of or significant influence over an investee due
to partial disposal of the equity investment or other reasons the remaining equity investment shall be
accounting for using Accounting Standard for Business Enterprises No. 22 - Recognition and
Measurement of Financial Instruments and the difference between the fair value and the carrying
amount of the remaining equity investment shall be charged to profit or loss for the current period at
the date of the loss of joint control or significant influence. Any other comprehensive income previously
recognised under the equity method shall be accounted for on the same basis as would have been
required if the Company had directly disposed of the related assets or liabilities for the current period
upon discontinuation of the equity method. Other movement of owner’s equity related to original equity
investment is transferred to profit or loss for the current period.When the Company can no longer exercise control over an investee due to partial disposal of the
equity investment or other reasons and the remaining equity after disposal can exercise joint control of
or significant influence over an investee the remaining equity is adjusted as using equity method from
acquisition. When the remaining equity can no longer exercise joint control of or significant influence
over an investee the remaining equity investment shall be accounted for using Accounting Standard
for Business Enterprises No. 22-Recognition and Measurement of Financial Instruments and the
difference between the fair value and the carrying amount of the remaining equity investment shall be
charged to profit or loss for the current period at the date of loss of control.When the Company can no longer exercise control over an investee due to new capital injection by
other investors and the Company can exercise joint control of or significant influence over an investee
the Company recognizes its share of the investee’s new added net assets using new shareholding
percentage. The difference between its new share of the investee’s new added net assets and its
decreased shareholding percentage of the original investment is recognized in profit or loss. And the
Company adjusts to the equity method using the new shareholding percentage as if it uses the equity
method since it obtains the investment.Unrealized internal trading gains and losses between the group and associated enterprises and joint
ventures shall be calculated as part of the group according to the shareholding ratio and investment
gains and losses shall be recognized on an offset basis. However unrealized internal trading losses
between the group and the investee shall not be offset if they are impairment losses of the
transferred assets.
(3) Criteria for determining the existence of joint control or significant influence over an investee
Joint control is the contractually agreed sharing of control of an arrangement which exists only when
decisions about the relevant activities require the unanimous consent of the parties sharing control.When assessing whether the Company can exercise joint control over an investee the Company first
considers whether no single participant party is in a position to control the investee’s related activities
unilaterally and then considers whether strategic decisions relating to the investee’s related activities
require the unanimous consent of all participant parties that sharing of control. All the parties or a
group of the parties control the arrangement collectively when they must act together to direct the
relevant activities. When more than one combination of the parties can control an arrangement
collectively joint control does not exist. A party that holds only protective rights does not have joint
control of the arrangement.Significant influence is the power to participate in the financial and operating policy decisions of an
investee but does not have control or joint control over those policies. When determining whether the
Company can exercise significant influence over an investee the effect of potential voting rights (for
example warrants share options and convertible bonds) held by the Company or other parties that
are currently exercisable or convertible shall be considered.When the Company directly or indirectly through subsidiaries owns 20% of the investee (including
20%) or more but less than 50% of the voting shares it has significant influence over the investee
unless there is clear evidence to show that in this case the Company cannot participate in the
production and business decisions of the investee and cannot form a significant influence. When the
Company owns less than 20% of the voting shares generally it does not have significant influence
over the investee unless there is clear evidence to show that in this case the Company can participate
in the production and business decisions of the investee so as to form a significant influence.
(4) Method of impairment testing and impairment provision
For investments in subsidiaries associates and joint ventures refer to Note III. 19 for the impairment
of assets..
14. Investment property
Investment properties are properties held either to earn rental income or for capital appreciation or for
both. The Group's investment real estate includes leased houses buildings and leased land use rights.In addition for a vacant building held by the company for operating lease if the board of directors (or a
similar institution) makes a written resolution expressly indicating that it is used for operating lease and
the intention of holding does not change in the short term it is also considered as Investment property.Investment properties are initially measured at acquisition cost and depreciated or amortized using the
same policy as that for fixed assets or intangible assets.
For the impairment of the investment properties accounted for using the cost model refer to Note
III.19.Gains or losses arising from the sale transfer retirement or disposal of an item of investment property
are determined as the difference among the net disposal proceeds the carrying amount of the item
related taxes and surchages and are recognised in profit or loss for current period.
15. Fixed assets
(1) Recognition of fixed assets
Fixed assets represent the tangible assets held by the Company for use in production of goods use in
supply of services rental or for administrative purposes with useful lives over one accounting year.
Fixed assets are only recognised when its related economic benefits are likely to flow to the Company
and its cost can be reliably measured.
Fixed asset are initially measured at cost.
(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:
Category Useful life （years） Residual value rate % Annual depreciation rate %
Plant and buildings 30 5 3.17
Motor vehicles 6 5 15.83
Electronic equipment and others 5 5 19.00
For impaired fixed assets cumulative amount of impairment provision is deducted in determinatingf the
depreciation rate.
(3) The impairment of the fixed assets is set out in Note III. 19.
(4) Recognition and measurement of fixed assets acquired under finance leases
Fixed assets under finance leases are recognised if they meet one or more of the following criteria:
①The ownership of leased assets is transferred to the Company by the end of the lease term.②The Company has the option to purchase the asset at a price that is expected to be sufficiently
lower than the fair value at the date of the option becomes exercisable for it to be reasonably certain
at the inception of the lease that the option will be exercised.③Even if the ownership of assets is not transferred the lease term covers the major part of the useful
life of the asset.
④At the inception of lease the present value of minimum lease payments amount to substantially all
of the fair value of leased asset.⑤Leased assets are of a specialized nature that only the Company can use them without major
modifications.
An asset acquired under a finance lease is measured at an amount equal to the lower of its fair value
and the present value of the minimum lease payments each determined at the inception of the lease.Long-term payable is recorded at an amount equal to the sum of all future minimum lease payments.The difference between the carrying amount of the leased assets and the minimum lease payments is
accounted for as unrecognised finance charges. Initial direct costs attributable to a finance lease
incurred during the process of lease negotiation and the signing of the lease agreement including
service charges attorney's fees travelling expenses and stamp duty that are incurred by the
Company are added to the carrying amount of the leased asset. Unrecognised finance charges are
recognised as finance charge for the period using the effective interest method over the lease term.
Depreciation is accounted for in accordance with the accounting policies of fixed assets. If there is
reasonable certainty that the Company will obtain ownership of a leased asset at the end of the lease
term the leased asset is depreciated over its estimated useful life. Otherwise the leased asset is
depreciated over the shorter of the lease term and its estimated useful life.
(5) Useful lives estimated residual values and depreciation methods are reviewed at least at each
year-end.The Company adjusts the useful lives of fixed assets if their expected useful lives are different with
the original estimates and adjusts the estimated net residual values if they are different from the
original estimates.
（6）Overhaul costs
Overhaul costs occurred in regular inspection are recognized in the cost if there is undoubted
evidence to confirm that this part meets the recognition criteria of fixed assets otherwise the
overhaul costs are recognized in profit or loss for the current period. Depreciation is provided during
the period of regular overhaul.
16. Construction in progress
Construction in progress is recognized based on the actual construction cost including all
expenditures incurred for construction projects 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.
The impairment of construction in progress is set out in Note III. 19.
17. 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:
① 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;
② borrowing costs have been incurred;
③ 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 Company borrows funds
generally and uses them for the purpose of obtaining a qualifying asset the Company shall determine
the amount of borrowing costs eligible for capitalisation by applying a capitalisation rate to the
expenditures on that asset the capitalisation rate shall be the weighted average of the borrowing costs
applicable to the borrowings of the Company that are outstanding during the period other than
borrowings specifically for the purpose of obtaining a qualifying asset.In the capitalisation period exchange differences of specific borrowings in foreign currency shall be
capitalised; exchange differences of general borrowings in foreign currency is recognised in profit or
loss for the current period.
18. Intangible assets
Intangible assets include software land use right and patent rights etc.Intangible assets are stated at actual cost upon acquisition and the useful economic lives are
determined at the point of acquisition. When the useful life is finite amortisation method shall reflect
the pattern in which the asset’s economic benefits are expected to be realised. If the pattern cannot
be determined reliably the straight-line method shall be used. An intangible asset with an indefinite
useful life shall not be amortised.The Company shall review the useful life and amortisation method of an intangible asset with a finite
useful life at least at each year end. Changes of useful life and amortisation method shall be
accounted for as a change in accounting estimate.
An intangible asset shall be derecognised in profit or loss when it is not expected to generate future
economic benefits.The impairment of intangible assets is set out in Note III. 19.
19. 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
intangible assets goodwill(Excluding inventories deferred tax assets and financial assets) is
determined as follows:
At each balance sheet date the Company determines whether there is any indication of impairment.
If any indication exists the recoverable amount of the asset is estimated. In addition the Company
estimates the recoverable amounts of goodwill intangible assets with indefinite useful lives and
intangible assets not ready for use at each year-end irrespective of whether there is any indication
of impairment.The recoverable amount of an asset is the higher of its fair value less costs to sell and its present
value of expected future cash flows. The recoverable amount is estimated for each individual asset. If
it is not possible to estimate the recoverable amount of each individual asset the Company determines
the recoverable amount for the asset group to which the asset belongs. An asset group is the smallest
identifiable group of assets that generates cash inflows that are largely independent of the cash inflows
from other assets or asset groups.
An impairment loss is recognised in profit or loss when the recoverable amount of an asset is less than
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 Company.In impairment testing if impairment indication exists in asset group or portfolio of asset group
containing allocated goodwill impairment test is first conducted for asset group or portfolio of asset
group that does not contain goodwill and corresponding recoverable amount is estimated and any
impairment loss is recognized. Then impairment test is conducted for asset group or portfolio of
asset group containing goodwill by comparing 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.
20. Long-term deferred expenses
Long-term deferred expenses are recorded at the actual cost and amortized using a straight-line
method within the benefit period. For long-term deferred expense that cannot bring benefit in future
period the Company recognized its amortised cost in profit or loss for the current period.
21. Employee benefits
(1) Scope of employee benefits
Employee benefits refer to all forms of consideration or compensation given by the Company in
exchange for service rendered by employees or for the termination of employment relationship.Employee benefits include short-term employee benefits post-employment benefits termination
benefits and other long-term employee benefits. Benefits provided to the Company’s spouse
children dependents family members of deceased employees or other beneficiaries are also part of
the employee benefits.
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 Company has accrued for the actual wages bonuses medical insurance for
employees based on standard rate work injury insurance and maternity insurance and other social
insurance and housing fund incurred and these are recognised as liabilities and corresponding costs in
the profit or loss. If these liabilities are not expected to be fully paid 12 months after the end of the
reporting period in which employee renders the service to the Company and if the financial impact is
significant these liabilities shall be discounted using the net present value method.
（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
corporation pension plan.
Besides basic pension insurance the Company establishes corporate pension plans in accordance
with the related policies of corporate pension regulations. Employees can join the pension plan
voluntarily. The Company has no other significant commitment of employees’ social security.The Company shall recognise in the accounting period in which an employee provides service the
contribution payable to a defined contribution plan as a liability with a corresponding charge to the
profit or loss for the current period or the cost of a relevant asset.
Defined benefit plan
For the defined benefit plan independent actuary uses an actuarial technique the projected unit credit
method to make a reliable estimate of the ultimate cost to the entity of the benefit that employees
have earned in return for their service in the current and prior periods on the balance sheet date. The
Group set the defined benefit plan including the following components:
① Service costs including current service costs any past service costs and gain or loss on settlement.
Among them the current service cost is the increase in the present value of the defined benefit obligation
resulting from employee service in the current period; the past service cost is the change in the present
value of the defined benefit obligation for employee service in prior periods resulting from a plan
amendment (the introduction or withdrawal of or changes to a defined benefit plan) or a curtailment (a
significant reduction by the entity in the number of employees covered by a plan).② Net interest on the net defined benefit liability (asset) can be viewed as comprising interest
income on plan assets interest cost on the defined benefit obligation and interest on the effect of the
asset ceiling
③ Re-measurements of the net defined benefit liability and assets.The Group makes determining amounts to be recognized in profit or loss except other accounting
standards stipulates or allows employee benefits recorded as asset cost. Re-measurements of the
changes in the net defined benefit liability (asset) recognized in other comprehensive income shall not
be reclassified to profit or loss in a subsequent period. However the entity may transfer those amounts
recognized in other comprehensive income within equity when original defined benefit plan is
terminated.
(4) Termination benefits
The Company provides for termination benefits to the employees and shall recognize an employee
benefits liability for termination benefits with a corresponding charge to the profit or loss for the current
period at the earlier of the following dates: When the Company cannot unilaterally withdraw the offer
of the termination benefits from an employment termination plan or a redundancy proposal; the
Company recognizes the costs or expenses relating to a restructuring that involves the payment of the
termination benefits..If an employee's internal retirement plan is implemented the economic compensation before the
official retirement date is a dismissal benefit. From the date when the employee stops providing
services to the normal retirement date the salary of the retired employee and the social insurance
premium to be paid are included in the current period at one time profit and loss. Financial
compensation after the official retirement date (such as a normal retirement pension) is treated as
after-service benefits.
(5) Other long-term employee benefits
Other long-term employee benefits provided by the Company to the employees satisfied the conditions
for classifying as a defined contribution plan; those benefits shall be accounted for in accordance with
the above requirements relating to defined contribution plan. When the benefits satisfy a defined
benefit plan it shall be accounted for in accordance with the above requirements relating to defined
benefit plan but the movement of net liabilities or assets in re-measurement of defined defined benefit
plan shall be recorded in profit or loss for the current period or cost of relevant assets.
22. Provisions
A provision is recognised for an obligation related to a contingency if all the following conditions are
satisfied:
(1) the Company has a present obligation;
(2) it is probable that an outflow of economic benefits will be required to settle the obligation;
(3) the amount of the obligation can be estimated reliably.
A provision is initially measured at the best estimate of the expenditure required to settle the related
present obligation. Factors pertaining to a contingency such as the risks uncertainties and time value
of money are taken into account as a whole in reaching the best estimate. Where the effect of the time
value of money is material provisions are determined by discounting the expected future cash flows.The Company reviews the carrying amount of a provision at the balance sheet date and adjusts the
carrying amount to the current best estimate.If all or part of the expenditure necessary for settling the provision is expected to be compensated by a
third party the amount of compensation is separately recognized as an asset when it is basically
certain to be received. The recognized compensation amount shall not exceed the carrying amount of
the provision.
23. Revenue
(1) General principle
The Group has fulfilled its contractual performance obligation to recognize revenue when the customer
takes control of the goods or services in question.If the contract contains two or more performance obligations the Group shall at the beginning of the
contract allocate the transaction price to each individual performance obligation in proportion to the
relative selling price of the goods or services promised by each individual performance obligation and
measure the income at the transaction price allocated to each individual performance obligation.Where one of the following conditions is met the Group is a performance obligation within a certain
period of time;
①The customer obtains and consumes the economic benefits of the Group's performance at the
same time as the Group performs.
②Customers are able to control the goods under construction in the performance of the Group.
③The goods produced in the performance of the Group are of irreplaceable use and the Group has
the right to receive payments for the performance portion accumulated to date throughout the
contract period.
For performance obligations performed during a certain period of time the Group recognizes revenue
at the performance pace during that period. Where the performance schedule cannot be reasonably
determined if the costs already in the Group are expected to be compensated the revenue is
recognized in accordance with the amount of costs already occurring until the performance progress
can be reasonably determined.
For performance obligations performed at a certain point in time the Group recognizes revenue at the
point when the customer takes control of the relevant goods or services. In determining whether a
customer has taken control of goods or services the Group considers the following signs:
①The Group has the right to collect the goods or services at present i.e. the customer has the current
obligation to pay for the goods.②The Group has transferred the legal ownership of the commodity to the customer i.e. the customer
already owns the legal ownership of the commodity.③The Group has transferred the goods in kind to the customer i.e. the customer has physically
owned the goods.④The Group has transferred the main risks and rewards of ownership of the commodity to the
customer i.e. the main risks and rewards of the customer's ownership of the commodity.⑤The customer has accepted the goods or services.⑥Other signs that the customer has taken control of the goods.The Group has transferred goods or services to customers and is entitled to a consideration right (and
that right depends on factors other than the passage of time) as contractual assets which are
impairments based on expected credit losses (see notes III 10 (5)). The Right of the Group to collect a
bid from a customer as a receivable is owned and unconditionally (depending only on the passage of
time). The Group's obligation to transfer goods or services to customers as contractual liabilities as a
result of customer-to-customer prices received or receivables.Where contract assets and contractual liabilities under the same contract are shown in net amounts
net of borrower balances they are shown in "contract assets" or "other non-current assets" items
according to their liquidity;
(2)Specific revenue recognition
Specific revenue recognition is as follows:
①Real estate development sales revenue recognition
1) the sales contract has been signed and filed with the land department; 2) the real estate has been
completed and accepted; 3)fully one-off payment on the first installment payment has been received; 4)
completed the procedures for entering the partnership in accordance with the requirements stipulated
in the sales contract.② Provide the specific method of property service income recognition
According to the service date agreed in the property service contract and agreement and the area and
unit price corresponding to the service during the period of service stipulated in the property service
contract and agreement the realization of the income from the provision of property services shall be
confirmed according to the average number of years.③Rental property income recognition of the specific method
According to the lease contract the lease date agreed upon in the agreement (with a rent-free period
considered rent-free period) and the lease amount the realization of the income from the provision of
rental services shall be confirmed by the average law of the number of years during the lease term
stipulated in the contract.
④Construction income recognition methods
As the Client is able to control the assets under construction in the Group's performance process the
Group treats them as performance obligations within a certain period of time recognizing income in
accordance with the performance schedule except the schedule cannot be reasonably determined.The Group determines the progress of service delivery in accordance with input laws and costs that
occur. Where the performance schedule cannot reasonably be determined if the costs expected to be
reimbursed by the Company are recognized in accordance with the amount already occurring until the
performance progress can be reasonably determined. If the contract cost cannot be recovered it is
recognized as the current cost immediately upon occurrence and the contract income is not
recognized. If the total cost of the contract is likely to exceed the total contract revenue the expected
loss of the contract is formed taken into account in the projected liability and recognized as the
current cost.⑤Other income recognition methods
Including hotel income etc.. For hotel income as the customer in the Group's performance at the
same time to obtain and consume the Economic Benefits of the Group's performance the Group as a
performance obligation performed within a certain period of time in the provision of services during the
accounting period in accordance with the performance of the progress of the recognition of income.
For other income in accordance with the relevant contract agreement when the customer obtains
control of the relevant goods the relevant amount has been received or received the right to receive
the recognition of income
24. Contract costs
Contract costs include incremental costs and contract performance costs for the contract.
Incremental costs to obtain a contract are costs (e.g. sales commissions etc.) that would not have
occurred if the Group had not obtained the contract. If the cost is expected to be recoverable the
Group recognizes it as an asset as a contract cost. The Group's expenses for the purpose of obtaining
the contract in addition to incremental costs expected to be recoverable are included in the current
profit and loss at the time of occurrence.If the costs ad to be costs addjobed in order to perform the contract are not covered by the accounting
standards of other enterprises such as inventory and the following conditions are met at the same
time the Group recognizes them as an asset as contract performance costs:
①The cost is directly related to a current or anticipated contract including direct labor direct materials
manufacturing costs (or similar costs) costs expressly borne by the customer and other costs
adminoly occurring only as a result of the contract;
②This cost increases the Group's future resources for the performance of performance obligations;
③The cost is expected to be recovered.
Assets recognized by the contract to obtain cost recognition and assets recognized at the contract
performance cost ("assets related to the contract cost") are amortized on the same basis as the
recognition of income from goods or services associated with the asset and are included in the current
profit and loss. Amortization periods of not more than one year are included in the current profit and
loss at the time of occurrence.Where the carrying value of the assets relating to the contract cost is higher than the difference
between the following two items the Group prepares for impairment of the excess and recognizes the
impairment loss of the assets:
①the remaining price that the Group is expected to be able to obtain as a result of the transfer of
goods or services related to the asset;
②Estimated costs to be expected for the transfer of the relevant goods or services.
The contract performance cost recognized as an asset the amortization period at the time of initial
confirmation shall not exceed one year or a normal business cycle shall be shown in the "inventory"
item and the amortization period at the time of initial confirmation shall exceed one year or a normal
business cycle as shown in the "other non-current assets" project.The contract cost of obtaining the asset is recognized the amortization period at the time of initial
confirmation does not exceed one year or a normal business cycle as shown in the "Other Current
Assets" project and the amortization period at the time of initial recognition exceeds one year or a
normal business cycle as shown in the "Other Non-Current Assets" project.
25. Government grants
A government grant is recognised when there is reasonable assurance that the grant will be received
and that the Group will comply with the conditions attaching to the grant.If a government grant is in the form of a transfer of a monetary asset it is measured at the amount
received or receivable. If a government grant is in the form of a transfer of a non-monetary asset it is
measured at fair value. If fair value cannot be reliably determined it is measured at a nominal amount
of RMB 1.The government grants relating to assets are grants that Group purchases construction or other
methods to acquire long-term assets of government grants. Exception of the above grants others are
related to gains.
For government grants with unspecified purpose the amount of grants used to form a long-term asset
is regarded as government grants related to an asset the remaining amount of grants is regarded as
government grants related to income. If it is not possible to distinguish the amount of grants is treated
as government grants related to income.
A government grant related to an asset is offset against the carrying amount of the related asset
or.recognised as deferred income and amortised to profit or loss over the useful life of the related
asset on a reasonable and systematic manner. A grant that compensates the Group for expenses or
losses already incurred is recognised in profit or loss or offset against related expenses directly. A
grant that compensates the Group for expenses or losses to be incurred in the future is recognised as
deferred income and included in profit or loss or offset against related expenses in the periods in
which the expenses or losses are recognised.
A grant related to ordinary activities is recognised as other income or offset against related expenses
based on the economic substance. A grant not related to ordinary activities is recognised as
non-operating income.When a recognised government grant is reversed carrying 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.26. Deferred tax assets and deferred tax liabilities
Income tax comprises of current tax and deferred tax. Current tax and deferred tax are recognised in
profit or loss except to the extent that they relate to transactions or items recognised directly in equity
and goodwill arising from a business combination.
Deferred tax assets and deferred tax liabilities arise from deductible and taxable temporary differences
respectively being the differences between the carrying amounts of assets and liabilities for financial
reporting purposes and their tax bases.
All the taxable temporary differences are recognized as deferred tax liabilities except for those incurred
in the following transactions:
(1) initial recognition of goodwill or assets or liabilities in a transaction that is not a business
combination and that affects neither accounting profit nor taxable profit (or deductible loss);
(2) taxable temporary differences associated with investments in subsidiaries associates and joint
ventures and the Company is able to control the timing of the reversal of the temporary difference and
it is probable that the temporary difference will not reverse in the foreseeable future.The Company recognises a deferred tax asset for deductible temporary differences deductible losses
and tax credits carried forward to subsequent periods to the extent that it is probable that future
taxable profits will be available against which deductible temporary differences deductible losses and
tax credits can be utilised except for those incurred in the following transactions:
(1) a transaction that is not a business combination and that affects neither accounting profit nor
taxable profit (or deductible loss);
(2) deductible temporary differences associated with investments in subsidiaries associates and joint
ventures the corresponding deferred tax asset is recognized when both of the following conditions are
satisfied: it is probable that the temporary difference will reverse in the foreseeable future; and it is
probable that taxable profits will be available in the future against which the temporary difference can
be utilized.
At the balance sheet date deferred tax is measured based on the tax consequences that would follow
from the expected manner of recovery or settlement of the carrying amount of the assets and liabilities
using tax rates enacted at the reporting date that are expected to be applied in the period when the
asset is recovered or the liability is settled.The carrying amount of a deferred tax asset is reviewed at each balance sheet date and is reduced to
the extent that it is no longer probable that the related tax benefits will be utilised. Such reduction is
reversed to the extent that it becomes probable that sufficient taxable profits will be available.
27. Operating leases and finance leases
A finance lease is a lease that transfers substantially all the risks and rewards incidental to ownership
of a leased asset to the lessee. An operating lease is a lease other than a finance lease.
(1)As a lessor
At the commencement of the lease term the Company recognized the aggregate of the minimum
lease receipts determined at the inception of a lease and the initial direct costs as finance lease
receivable and recognized unguaranteed residual value at the same time. The difference between the
aggregate of the minimum lease receipts the initial direct costs and the unguaranteed residual value
and the aggregate of their present value is recognized as unearned finance income. Unearned finance
income is allocated to each accounting period during the lease term using the effective interest method.Income derived from operating leases is recognized in profit or loss using the straight-line method over
the lease term. Initial direct costs are charged to profit or loss immediately.
(2)As a lessee
When the Company acquires an asset under a finance lease the asset is measured at an amount
equal to the lower of its fair value and the present value of the minimum lease payments each
determined at the inception of the lease. At the commencement of the lease term the minimum lease
payments are recorded as long-term payables. The difference between the carrying amount of the
leased assets and the minimum lease payments is accounted for as unrecognized financial charges.Initial direct costs attributable to a finance lease that are incurred by the Company are added to the
carrying amount of the leased asset. Unrecognized finance charges arising from a finance lease are
recognized using an effective interest method over the lease term. Depreciation is accounted for in
accordance with the accounting policies of fixed assets.Rental payments under operating leases are recognized as part of the cost of another related asset
or as expenses on a straight-line basis over the lease term. Initial direct costs are charged to profit
or loss immediately.
(3) Rental concessions caused by the COVID-19
For rental concessions such as rent remission and deferred payment reached between the Company
and the lessor on the existing lease contracts directly caused by the COVID-19 and if the following
conditions are met the Company adopts a simplified method for the rental of buildings category:
①The lease consideration after the concession is reduced or the same from that before the
concession where the lease consideration is not discounted or discounted at the discount rate before
the concession;
②The concession applies only to lease payments payable prior to June 30 2021;
③Taking both qualitative and quantitative factors into account it is determined that there are no
material changes to the other terms and conditions of the lease.The Group does not evaluate whether a lease change has occurred.When the Group is a lessee the Group continues to include the original contract rent in the related
asset costs or expenses in accordance with the method consistent with the pre-concession for
operating leases. In the event of rent relief the Group shall write down costs or expenses during the
relief period by using the rent relief as a rent and if the rent is deferred the Group shall recognize the
rent payable as payable during the original payment period and write down the amount of payable
recognized in advance at the time of actual payment. For financial leases the Group continues to
recognize unrecfined financing expenses as current financing expenses at a discount rate consistent
with the pre-concession rate and continues to provide subsequent measures such as depreciation of
financing leased assets in accordance with the method consistent with the pre-concession. In the
event of rent relief the Group shall take the rent reduction as the rent or have rent in the event of the
termination of the original rent payment obligations such as the agreement to reduce the cost of
assets or expenses and adjust the long-term payables accordingly in accordance with the discount
rate before the discount rate discounted into the current profit and loss should also adjust the
unrefired financing costs;
When the Group is a lessor the Group continues to recognize the original contract rent as rental
income in accordance with the method consistent with the previous reduction for operating leases. In
the event of rent relief the Group shall use the reduced rent as a rent on a nature basis to reduce
rental income during the relief period and if the rent is deferred the Group shall recognize the rent due
during the original collection period as receivable and when actually received write down the amounts
receivable recognized in the previous period. For financial leases the Group continues to recognize
unreal financial gains as lease income at the lease inclusion rate consistent with the pre-reduction rate.In the event of rent relief the Group shall take the rent reduction as the ortnance rent and when it
abandons the original rent collection right such as reaching a reduction agreement the portion of the
original confirmed lease income shall be deducted from the investment income and the long-term
receivables shall be adjusted accordingly and if the discount rate before the reduction is included in
the current profit or loss the unrealed financing income shall also be adjusted;
28. Maintenance funds
The Group collects the maintenance funds from owners as the certain proportion of the sales amount
when selling commercial housing. It shall be included in the long-term accounts payable. The
maintenance funds will reduce when it is delivered to the land and housing administration.
29. Quality deposit
The quality deposit is based on the proportion of the construction and installation and the term of
paymentwhich is ruled in the contracts. It is deducted from the construction payables and classified as
accounts payable. Maintenance costs due to quality during the warranty period are directly expensed
under this account and will be eliminated when the warranty period ends.
30. Significant accounting estimates and judgments
Estimates as well as underlying assumptions involved are reviewed on an ongoing basis based on
historical experience and other factors including reasonableness of estimation about future events.The followings are significant accounting estimations and key assumptions that have a significant risk
of causing a material adjustment to the carrying amount of assets and liabilities within the next
financial year.:
(1)Classification of financial assets
The Group’s major judgments in determining the classification of financial assets include the analysis
of business models and the characteristics of contract cash flows.
At the level of financial asset group the Group determines the business model for managing financial
assets taking into account factors such as the way to evaluate and report financial assets
performance to key managers the risks affecting financial assets performance and their management
methods and the way in which relevant business managers are paid.In assessing whether the contract cash flow of financial assets is consistent with the basic lending
arrangements the Group has the following judgments: whether the principal’s time distribution or
amount may change during the lifetime for early repayment and other reasons; whether the interest
only includes the time value of money credit risk other basic lending risks and the consideration of
cost and profit. For example does the amount of advance payment only reflect the unpaid principal
and interest based on the unpaid principal and reasonable compensation paid for the early termination
of the contract.
(2)Measurement of Expected Credit Loss of Account Receivable
The Group calculates the expected credit losses of accounts receivable by default risk exposure and
expected credit losses rate of accounts receivable and determines the expected credit losses rate
based on default probability and default loss rate. In determining the expected credit losses rate the
Group uses internal historical credit loss and other data and adjusts the historical data with current
situation and forward-looking information. In considering forward-looking information the indicators
used by the Group include the risks of economic downturn external market environment technological
environment and changes in customer conditions. The Group regularly monitors and reviews
assumptions related to the calculation of expected credit losses.
(3) Deferred tax assets
Deferred tax assets relating to certain temporary differences and tax losses are recognised as
management considers it is probable that future taxable profit will be available against which the
temporary differences or tax losses can be utilised. The management needs significant judgment to
estimate the time and extent of the future taxable profits and tax planning strategy to recognise
the appropriate amount of deferred income tax assets.
(4)The provision of land appreciation tax
The Group is subject to land appreciation tax (“LAT”). The Group recognised LAT based on
management’s best estimates however LAT is recognised by tax authorities according to the
interpretation of the tax rules. The final tax outcome could be different from the amounts that were
initially recorded and these differences will impact tax provision in periods in which such taxes have
been finalised with local tax authorities.
(5) Determination of fair value of unlisted equity investment
The fair value of an unlisted equity investment is the future cash flow discounted from the current
discount rate of a project with similar terms and risks. This valuation requires the group to estimate
future cash flows and discount rates. Therefore it causes high uncertainty. In same cases there is
insufficient information to determine fair value or the distribution of possible estimates is wide. On the
contrary the cost represents the best estimate of fair value within that range. As a whole the cost can
represent the appropriate estimate of fair value within that range.
31. Changes in significant accounting policies accounting estimates and correction of errors in prior
periods
(1) Provisions Changes in significant accounting policies
①New revenue accounting policy
In 2017 the Ministry of Finance promulgated Enterprise Accounting Standards No. 14 - Revenue
(Amendment) (hereinafter referred to as the "New Revenue Standards") which requires companies
listed in China to take effect from January 1 2020. The Group has implemented the above-mentioned
new revenue standards as required from 1 January 2020 and the Group has implemented the
above-mentioned standards as of 1 January 2020 with adjustments to the relevant elements of its
accounting policies.The Group has fulfilled its contractual performance obligation to recognize revenue when the customer
takes control of the goods or services in question. When certain conditions are met the Group is
performing its performance obligations within a certain period of time otherwise it is performing its
performance obligations at a certain point in time. If the contract contains two or more performance
obligations the Group shall at the beginning of the contract allocate the transaction price to each
individual performance obligation in proportion to the relative selling price of the goods or services
promised by each individual performance obligation and measure the income at the transaction price
allocated to each individual performance obligation.The Group adjusted relevant accounting policies in accordance with the specific provisions of the new
revenue standards on specific matters or transactions for example: contractual cost quality assurance
distinction between principal and agent sales with sales return clauses additional purchase options
intellectual property license repurchase arrangement advances from customers and handling of initial
fee without refund etc.The Group has the right to receive consideration by transferring goods to customers and this right
depends on factors other than the passage of time as contractual assets. The Group’s obligation to
transfer goods to customers for consideration received or receivable from customers is listed as
contractual liabilities.
Based on the cumulative impact of the initial implementation of the new revenue standards the Group
adjusted its retained earnings at the beginning of 2020 and other related items in the financial
statements without adjusting for comparative financial statement data. The Group adjusts the Group's
retained earnings at the beginning of 2020 and the amount of other related items in the financial
statements only for cumulative impact on contracts not completed as at 1 January 2020.The content and reason of the accounting policy
change
Affected report items
Affected amount
（1/1/2020）
As a result of the implementation of the new
revenue guidelines the Group reclassified the sale of
goods and services-related sales and pre-receivables
related to the provision of services to contractual
liabilities.。
Contractual liabilities 147479218.39
Advance form customers -153363826.53
Other current liabilities 5884608.14
The impact of the implementation of the new income standards on items related to the 2020 financial
statements compared to the original income standards is as follows:
Affected balance sheet items
Affected amount
（31/12/2020）
Contractual liabilities 196786977.19
Advance form customers -205704004.26
Other current liabilities 8917027.07
Adjustment statement
The implementation of the new revenue guidelines with the transfer of control as the point of revenue
recognition will not result in a significant change in the way the company's revenue is recognized.(2) The Ministry of Finance issued the "Notice on the issuance of accounting treatment of COVID-19 for
Rental Concessions" (Finance and Accounting [2020] No. 10) in June 2020 with the option of adopting a
simplified method in accordance with the accounting treatment of COVID-19 for rental concessions.The Group has not chosen to adopt a simplified approach to this provision and therefore the provision
has not had a material impact on the Group's financial position and results of operations.
（2）At the first implementation of the new financial instrument standards the situation to adjust the
relevant items of the financial statements at the beginning of the first implementation year is as follow:
Consolidated balance sheet
Category As at 31/12/2019 As at 1/1/2020
Adjusted
amount
Current Assests:
Cash at bank and on hand 2511140445.35 2511140445.35 -
Accounts receivable 62059055.68 62059055.68 -
Prepayments 219948.17 219948.17 -
Other receivables 28275228.26 28275228.26 -
including: interest receivable - - -
Dividends receivable 1052192.76 1052192.76 -
Inventory 1462229048.18 1462229048.18 -
Other current assets 102781855.48 102781855.48 -
Total current assets 4166705581.12 4166705581.12 -
Non-current assets: -
Long-term equity investments 469838.65 469838.65 -
Investment in other equity instruments 33126730.04 33126730.04 -
Investment properties 632241900.20 632241900.20 -
Fixed assets 30522035.11 30522035.11 -
Long-term deferred expenses 162125.72 162125.72 -
Deferred tax assets 46441325.25 46441325.25 -
Total non-current assets 742963954.97 742963954.97 -
Total assets 4909669536.09 4909669536.09 -
Current liabilities:
Short-term borrowing 51647260.17 51647260.17 -
Accounts payable 244224478.46 244224478.46 -
Advances from customers 159482510.43 6118683.90 -153363826.53
Contractual liabilities 147479218.39 147479218.39
Employee benefits payable 53909576.49 53909576.49 -
Taxes payable 585700815.36 585700815.36
Other payables 277319174.53 277319174.53
including: interest payable 16535277.94 16535277.94
Dividends payable - - -
Other current liabilities 5884608.14 5884608.14
Category As at 31/12/2019 As at 1/1/2020
Adjusted
amount
Total current liabilities 1372283815.44 1372283815.44 -
Non-current liabilities: -
Long-term payables 7499192.92 7499192.92 -
Deferred tax liabilities 4903293.58 4903293.58 -
Total non-current liabilities 12402486.50 12402486.50 -
Total liabilities 1384686301.94 1384686301.94 -
Equity 1011660000.00 1011660000.00 -
Capital accumulation 978244910.11 978244910.11 -
Other comprehensive benefits 20831004.13 20831004.13 -
Surplus accumulation 191222838.94 191222838.94 -
Profits are not distributed 1464915816.81 1464915816.81 -
Total shareholders' equity attributable to
the parent company
3666874569.99 3666874569.99 -
Minority shareholders' equity -141891335.84 -141891335.84 -
Total shareholders' equity 3524983234.15 3524983234.15 -
Total liabilities and shareholders'
equity
4909669536.09 4909669536.09 -
Balance sheet of parent company
Category As at 31/12/2019 As at 1/1/2020 Adjustments
Current Assets:
Cash at bank and in hand 1967688122.55 1967688122.55 -
Accounts receivable 156935.84 156935.84 -
Prepayments 200000.00 200000.00 -
Other receivables 835275498.69 835275498.69 -
including: interest receivable - - -
Dividends receivable - - -
Inventory 419453091.86 419453091.86 -
Other current assets 407560.64 407560.64 -
Total current assets 3223181209.58 3223181209.58 -
Non-current assets:
Long-term equity investments 150676516.92 150676516.92 -
Investment in other equity instruments 13229501.03 13229501.03 -
Investment real estate 522038731.16 522038731.16 -
Fixed assets 19586720.47 19586720.47 -
Long-term deferred expenses s 162125.72 162125.72 -
Deferred income tax assets 20975294.54 20975294.54 -
Total non-current assets 726668889.84 726668889.84 -
Total assets 3949850099.42 3949850099.42 -
Current liabilities: -
Short-term borrowing - - -
Category As at 31/12/2019 As at 1/1/2020 Adjustments
Accounts payable 103915931.14 103915931.14 -
Pre-receivables 59409454.38 - -59409454.38
Contractual liabilities 56580432.74 56580432.74
Payable to employees 25544403.23 25544403.23 -
Taxes payable 143434273.95 143434273.95
Other payables 190666487.82 190666487.82 -
including: interest payable 16535277.94 16535277.94 -
Dividends payable - - -
Other current liabilities 2829021.64 2829021.64
Total current liabilities 522970550.52 522970550.52 -
Non-current liabilities: -
Long-term payables - - -
Deferred income tax liabilities 1295046.51 1295046.51 -
Total non-current liabilities 1295046.51 1295046.51 -
Total liabilities 524265597.03 524265597.03 -
Share capital 1011660000.00 1011660000.00 -
Capital reserve 964711931.13 964711931.13 -
Other comprehensive income 922125.77 922125.77 -
Surplus reserve 168093225.53 168093225.53 -
Retained earnings 1280197219.96 1280197219.96 -
Total equity attributable to
shareholders of the Company
3425584502.39 3425584502.39
-
Non-controlling interests - - -
Total shareholders' equity 3425584502.39 3425584502.39 -
Total liabilities and shareholders'
equity
3949850099.42 3949850099.42
-
Adjustment statement
According to the company's revenue recognition principle the company will not form "contract assets"
after the implementation of the "New Revenue accounting Policy" and the impact of the financial
reporting data mainly involves the reclassification between the three accounts of "contract liabilities"
"Advances from customers" and "other current liabilities".
IV. Taxation
1. Main types of taxes and corresponding tax rates
Tax type Tax basis Tax rate%
VAT Taxable income 9653
Land appreciation tax
It shall be levied on the basis of the value-added value
of the real estate transferred and the prescribed tax rate
and paid in advance according to the type of real estate
product
Four progressive rates of
excess rate : 304050 60
Property tax The original value of house deducts 30% 1.2
City maintenance and
construction tax
Turnover tax payable 7
Education surcharge Turnover tax payable 3
Local education surcharge Turnover tax payable 2
Corporate income tax Taxable profits 2516.5
Description of VAT rates for different businesses:
The group is engaged in real estate development property management Construction in process and
other business income "notice on the pilot of replacing business tax with VAT" (Caishui [201636]) and
other relevant provisions. Since May 1 2016 the group's VAT taxable items and tax rates are shown
in the following table:
Type of revenue Tax Tax rate%
Sales of properties Simply filing return 5
Construction installation income Simply filing return 93
Rental income of Property Simply filing return 5
Income of Property Management Filing return generally 6
Description of enterprise income tax rates of different tax payers:
The corporate income tax rate is 25% for companies incorporated in China and 16.5% for companies
incorporated in Hong Kong.
2 tax concessions and approval
The Corporate income tax rate of HuaZhan Supervision and Shantou Songshan Company the
subsidiaries of the Group shall be subject to the preferential tax rate of 20% for small micro-profit
enterprises.V. Notes to the consolidated financial statements
1. Cash at bank and in hand
Item
As at 31/12/2020 As at 31/12/2019
Foreign
currency
amount
Exchange
rate
RMB
equivalent
Foreign
currency
amount
Exchange
rate
RMB
equivalent
Cash in hand： -- -- 61121.83 -- -- 66252.42
RMB -- -- 61121.83 -- -- 66252.42
Cash at bank： -- -- 1026042804.99 -- -- 1493123507.93
RMB -- -- 1019343085.65 -- -- 1485217117.53
USD 20831.05 6.5249 135920.52 5532.95 6.9762 38598.97
HKD 7798819.95 0.84164 6563798.82 8783167.25 0.89578 7867791.43
Including：
Deposits in finance
company
-- -- -- -- -- --
Other monetary
funds:
-- -- 1661361143.19 -- -- 1017950685.00
RMB -- -- 1661361143.19 -- -- 1017950685.00
Total -- -- 2687465070.01 -- -- 2511140445.35
Including: Total
overseas deposits
-- -- 6699719.34 -- -- 7936545.69
Note: At the end of the period RMB 1661361143.19 in Other monetary funds was a seven-day
notice deposit of which the principal amount was RMB1643000000.00 and interest was
RMB18361143.19.
2. Bills receivable
Bills type
2020.12.31 2019.12.31
Book balanc
e
Bad debt pr
eparation
Book value
Book
balance
Bad debt
preparation
Book value
Bank Acceptance
Bill
- - - - - -
Commercial
Acceptance Bill
37303205.62 1865160.28 35438045.34
- - -
Total 37303205.62 1865160.28 35438045.34 - - -
Notes:
(1) At the year ended there is no a pledge of notes receivable.
(2) Outstanding endorsed or discounted bills that have not matured at the end of the year:
Type Amount derecognized at year end
Amount not-derecognized at year
end
Bank Acceptance Bill - -
Commercial Acceptance Bill - 30068561.31
Total - 30068561.31
(3) At the year ended there is no bills transferred to accounts receivable due to non-performance of the
issuers.(4) According to the method classification of the provision of bad debt.
Type
2020.12.31 2019.12.31
Book balance Bad debt preparation Book value Book balance Bad debt preparation
Book
value
Amount Rate(%) Amount
Expected
credit loss
rate
(%)
Amount Rate (%) Amount
Expected
credit loss
rate
(%)
Amount value
Provision made
individually
--- --- --- --- --- --- --- --- --- ---
Collectively
assessed for
impairment based on
credit risk
characteristics
--- --- --- --- --- --- --- --- --- ---
including：
Bank Acceptance
Bill
--- --- --- --- --- --- --- --- --- ---
Commercial
Acceptance Bill
37303205.62 100.00 1865160.28 5.00 35438045.34
-- -- -- -- --
Total 37303205.62 100.00 1865160.28 5.00 35438045.34 -- -- -- -- --
Collectively assessed for impairment based on credit risk characteristics:
Commercial Acceptance Bill
Category
2020.12.31 2019.12.31
Bill receivable
Bad debt pr
eparation
Expected
credit loss
rate(%)
Bill receivable
Bad debt
preparation
Expected
credit loss
rate(%)
Within 1 year 37303205.62 1865160.28 5.00 --- --- ---
Total 37303205.62 1865160.28 5.00 --- --- ---
(5) Additions recoveries or reversals of provision for bad and doubtful debts during the year
Category Provision of bad debt
2019.12.31 ---
Additions 1865160.28
Recoveries ---
Written-off ---
Reversals ---
Others ---
2020.12.31 1865160.28
3. Accounts receivable
(1) Accounts receivable by aging
Aging As at 31/12/2020 As at 31/12/2019
Within 1 year 61614768.47 65195782.66
1 to 2 years --- 66518.00
2 to 3 years 66518.00 --
More than 3 years 24688143.06 24956115.96
Subtotal 86369429.53 90218416.62
Less: provision for bad and doubtful debts 26778485.47 28159360.94
Total 59590944.06 62059055.68
（2）Accounts receivable by category
Item
As at 31/12/2020
Book balance
Provision for bad and doubtful
debts
Carrying amount
Book value
Proportion
(%)
Book value
Expected credit
loss(%)
Provision assessed for
impairment individually
24688143.06 28.58 24688143.06 100.00 -
Item
As at 31/12/2020
Book balance
Provision for bad and doubtful
debts
Carrying amount
Book value
Proportion
(%)
Book value
Expected credit
loss(%)
Collectively assessed for
impairment based on credit
risk characteristics
61681286.47 71.42 2090342.41 3.39 59590944.06
Including:
Accounts receivable from
sales of properties
11114285.60 12.87 555714.28 5.00 10558571.32
Accounts receivable from
other customers
50567000.87 58.55 1534628.13 3.03 49032372.74
Total 86369429.53 100.00 26778485.47 31.00 59590944.06
Continued
Item
As at 31/12/2019
Book balance Provision for bad and doubtful debts
Carrying amount
Book value Proportion(%) Book value
Expected
credit loss(%)
Provision assessed for
impairment individually
24866900.27 27.56 24866900.27 100.00 --
Collectively assessed for
impairment based on credit
risk characteristics
65351516.35 72.44 3292460.67 5.04 62059055.68
Including:：
Accounts receivable from
sales of properties
10761284.37 11.93 538064.22 5.00 10223220.15
Accounts receivable from
other customers
54590231.98 60.51 2754396.45 5.05 51835835.53
Total 90218416.62 100.00 28159360.94 31.21 62059055.68
Provision assessed for impairment individually：
Item
As at 31/12/2020
Book balance
Provision for bad
and doubtful debts
Expected credit
loss (%)
Rationale of
provision
Agent business payment of
import and export
11574556.00 11574556.00 100.00
Expected to be not
recoverable
Long-term accounts
receivable from sales of
proproties
10132205.24 10132205.24 100.00
Expected to be not
recoverable
Accounts receivable from
revoked subsidaries
2328158.40 2328158.40 100.00
Expected to be not
recoverable
Other customers 653223.42 653223.42 100.00
Expected to be not
recoverable
Total 24688143.06 24688143.06 100.00
Continued
Item
As at 31/12/2019
Book balance
Provision for bad
and doubtful debts
Expected credit
loss (%)
Rationale of
provision
Agents’ payment of import
and export
11574556.00 11574556.00 100.00
Expected to be not
recoverable
Long-term accounts
receivable from sales of
properties
10626436.84 10626436.84 100.00
Expected to be not
recoverable
Accounts receivable from
revoked subsidaries
2328158.40 2328158.40 100.00
Expected to be not
recoverable
Other customers 337749.03 337749.03 100.00
Expected to be not
recoverable
Total 24866900.27 24866900.27 100.00
Collectively assessed for impairment based on credit risk characteristics：
Accounts receivable from sales of properties
Aging
2020.12.31 2019.12.31
Accounts rec
eivable
Provision for
bad debt
Expected
credit loss(%)
Accounts
receivable
Provision for
bad debt
Expected
credit loss(%)
Within 1 year 11114285.60 555714.28 5.00 10690000.00 534500.00 5.00
1-2 year -- -- -- 71284.37 3564.22 5.00
Total 11114285.60 555714.28 5.00 10761284.37 538064.22 5.00
Accounts receivable from other customers
Aging
2020.12.31 2019.12.31
Accounts rec
eivable
Provision for
bad debt
Expected
credit loss(%)
Accounts
receivable
Provision for
bad debt
Expected
credit loss(%)
Within 1 year 50500482.87 1531302.23 3.03 54590231.98 2754396.45 5.05
1-2 year 66518.00 3325.90 5.00 -- -- --
Total 50567000.87 1534628.13 3.03 54590231.98 2754396.45 5.05
（3）Additions recoveries or reversals of provision for bad and doubtful debts during the year
Item Provision for bad and doubtful debts
As at 31/12/2019 28159360.94
Adjustment amount for the first implementation of the new
financial instrument accounting policy
--
As at 1/1/2020 28159360.94
Provision -1380875.47
Recovery or reversals --
Written-off --
2020.12.31 26778485.47
（4）Top 5 entities with the largest balances of account receivables
Entity name
Book value a percentage of the
total balance at the
end of the accounts
receivable (%)
Provision for bad
and doubtful
debts
Closing balance Closing balance
Wuhan 2049 Poly Real Estate Development Co.Ltd
33009906.00 38.22 1650495.30
Wuhan Yutian Xingye Land Co. Ltd 5877079.73 6.80 293853.99
Hubei Chuheng Real Estate Co. Ltd 3874836.00 4.49 193741.80
Wuhan Anke United Real Estate Co. Ltd 1940032.59 2.25 97001.63
Daxing Auto Parts Co. Ltd 1912353.37 2.21 95617.67
Total 46614207.69 53.97 2330710.38
（5）At the end of the year 2020 the group has handled the factoring of accounts receivable（RMB
49686095.76） corresponding to the book value of accounts receivable RMB49686095.76 which has
not been terminated for recognition. The detail is set out in note V. 45.
4. Prepayments
(1) The aging analysis of prepayments is as follows:
Aging
As at 31/12/2020 As at 31/12/2019
Amount Proportion(%) Amount Proportion(%)
Within 1 year 3004771.47 93.74 19398.17 8.82
1 to 2 years 213.04 0.01 200000.00 90.93
2 to 3 years 200000.00 6.23 -- --
More than 3 years 550.00 0.02 550.00 0.25
Total 3205534.51 100.00 219948.17 100.00
（2）Top 5 entities with the largest balances of prepayment
The total amount of prepayment is RMB 3205534.51 accounting for 100.00% of the total amount of
the closing balance of prepayment.
5．Other receivables
Item As at 31/12/2020 As at 31/12/2019
Interest receivables -
Dividend receivables 1052192.76 1052192.76
Other receivables 31692851.08 27223035.50
Total 32745043.84 28275228.26
(1) Dividend receivables
Item As at 31/12/2020 As at 31/12/2019
Yunnan KunPeng Flight service Co. Ltd 1052192.76 1052192.76
Less：Provision for bad and doubtful debts -- --
Total 1052192.76 1052192.76
Including: significant dividends receivable aging over 1 year:
Item As at 31/12/2020 Aging
Reason for
uncollected
Any impairment
and the basis
Yunnan KunPeng Flight service Co. Ltd 1052192.76 5 years Delay to issue None
(2) Other receivables
①Other receivables by aging
Aging As at 31/12/2020 As at 31/12/2019
Within 1 year 29101943.94 20256667.46
1 to 2 years 724840.46 5670455.80
2 to 3 years 266855.66 --
More than 3 years 196836127.29 196658114.17
Subtotal 226929767.35 222585237.43
Less：Provision for bad and doubtful debts 195236916.27 195362201.93
Total 31692851.08 27223035.50
②Other receivables by category
Item
As at 31/12/2020 As at 31/12/2019
Book value
Provision for
bad and
doubtful debts
Carrying
amount
Book value
Provision for
bad and
doubtful debts
Carrying
amount
Amount receivables
from government
553009.68
-- 553009.68 4371247.34 -- 4371247.34
Amount receivables
from petty cash
364674.25
-- 364674.25 716684.01 -- 716684.01
Amount receivables
from the collecting and
paying on another's
behalf
665251.08
-- 665251.08 594012.08 -- 594012.08
Amount receivables
from current account
63398344.58
33288428.51 30109916.07 56713292.62 35639303.91 21073988.71
Amount receivables
from related parties
161948487.76
161948487.76 -- 160190001.38 159722898.02 467103.36
Total 226929767.35 195236916.27 31692851.08 222585237.43 195362201.93 27223035.50
③ Provision for bad and doubtful debts
As at 31/12/2020 there are the provisions for bad debts in the first stage :
Category
Book
balance
12-month
expected credit
loss(%)
Provision for bad
and doubtful
debts
Carrying
amount
Reasons
Collectively assessed for impairment based
on credit risk characteristics
Amount receivables from government 553009.68 -- -- 553009.68
Amount receivables from petty cash 364674.25 -- -- 364674.25
Amount receivables from the collecting and
paying on another's behalf
665251.08 -- -- 665251.08
Amount receivables from current account 31694648.48 5.00 1584732.41 30109916.07
Category
Book
balance
12-month
expected credit
loss(%)
Provision for bad
and doubtful
debts
Carrying
amount
Reasons
Amount receivables from related parties -- -- -- --
Total 33277583.49 4.76 1584732.41 31692851.08
As at 31/12/2020 there is no interest receivable dividends receivable and other receivables in the
second stage.
As at 31/12/2020 there are the provisions for bad debts in the third stage :
Category
Book
balance
To lifetime expected
credit loss
Provision for
bad and
doubtful debts
Carrying
amount
Reasons
Provision assessed for
impairment individually
Other receiables from revoked
subsidaries
3275882.44 100.00 3275882.44 --
Expected to be not
recoverable
Other receiables from existed
subsidaries
190376301.42 100.00 190376301.42 --
Expected to be not
recoverable
Including：Other receivables
from related parties
161948487.76 100.00 161948487.76 --
Expected to be not
recoverable
Total 193652183.86 100.00 193652183.86 --
As at 31/12/2019，Provision for bad and doubtful debts：
There were bad debt provisions in the first stage:
Category
Book
balance
12-month
expected credit
loss(%)
Provision for
bad and
doubtful debts
Carrying amount Reasons
Collectively assessed for impairment
based on credit risk characteristics
Amount receivables from government 4371247.34 -- -- 4371247.34
Amount receivables from petty cash 716684.01 -- -- 716684.01
Amount receivables from the
collecting and paying on another's
behalf
594012.08 -- -- 594012.08
Amount receivables from current
account
22183146.01 5.00 1109157.30 21073988.71
Amount receivables from related
parties
491687.74 5.00 24584.38 467103.36
Total 28356777.18 4.00 1133741.68 27223035.50
As at 31 December 2019 there was no interest receivable dividends receivable and other receivables
in the second stage.
As of December 31 2019 there were bad debt provisions in the third stage:
Category
Book
balance
To lifetime expected
credit loss
Provision for
bad and
doubtful debts
Carrying
amount
Reasons
Provision assessed for
impairment individually
Category
Book
balance
To lifetime expected
credit loss
Provision for
bad and
doubtful debts
Carrying
amount
Reasons
Other receiables from revoked
subsidaries
3838281.67 100.00 3838281.67 --
Expected to be not
recoverable
Other receiables from existed
subsidaries
190390178.58 100.00 190390178.58 --
Expected to be not
recoverable
Including： Other receivables
from related parties
159698313.64 100.00 159698313.64 --
Expected to be not
recoverable
Total 194228460.25 100.00 194228460.25 --
④ Additions recoveries or reversals of provision for bad and doubtful debts during the year
Provision for bad and
doubtful
The first stage The second stage The third stage
Total To 12-month
expected credit
loss
To lifetime expected
credit loss (no credit
impairment)
To lifetime expected
credit loss (has
occurred credit
impairmen)
Balance as at 31/12/2019 1133741.68 -- 194228460.25 195362201.93
Balance as at 31 December
2019 in the current period
Move on to the second stage
-- -- -- --
Move on to the third stage -- -- -- --
Turn back to the second stage -- -- -- --
Turn back to the first stage -- -- -- --
Provision 450990.73 -- -576276.39 -125285.66
Recovery -- -- -- --
Reversals -- -- -- --
Other changes -- -- -- --
Balance as at 31/12/2020 1584732.41 -- 193652183.86 195236916.27
⑤There were no other receivables written off in the current period.⑥Top 5 entities with the largest balances of other receivables
Name of Entity Nature Amount Aging
Proportion
of the
amount to
the total
OR (%)
Bad debt
provision
Canada Great
Wall( Vancouver) Co.Ltd
Related party transactions
89035748.07
More than 5
years
39.23 89035748.07
Paklid Limited Related party transactions
18870785.54
More than 5
years
8.32 18870785.54
Bekaton property Limited Related party transactions
12559290.58
More than 5
years
5.53
12559290.58
Guangdong province
Huizhou Luofu Hill Mineral
Water Co.Ltd
Related party transactions
10465168.81
More than 5
years
4.61 10465168.81
Xi’an Fresh Peak Property
Trading Co. Ltd
Related party transactions 8419205.19
More than 5
years
3.71 8419205.19
Total -- 139350198.19 -- 61.40 139350198.19
6. Inventories
（1）Categories of inventory
Item
As at 31/12/2020 As at 31/12/2019
Book value
Provision for
impairment of
inventories
Carrying amount Book value
Provision for
impairment
of inventories
Carrying amount
Real estate development projects
Developing
costs
556589091.25 -- 556589091.25 400425673.85 -- 400425673.85
Developed
products
659403711.71 268941.60 659134770.11 1060130671.64 268941.60 1059861730.04
Subtotal 1215992802.96 268941.60 1215723861.36 1460556345.49 268941.60 1460287403.89
Non real estate development projects
Raw material 873107.59 240000.00 633107.59 882857.81 240000.00 642857.81
Finished
products
631926.30 38891.91 593034.39 317200.81 38891.91 278308.90
Construction
in progress
3514109.22 - 3514109.22 1020477.58 -- 1020477.58
Subtotal 5019143.11 278891.91 4740251.20 2220536.20 278891.91 1941644.29
Total 1221011946.07 547833.51 1220464112.56 1462776881.69 547833.51 1462229048.18
（2）Provision for impairment of inventories
Category
As at
1/1/2020
Additions during
the year
Provision others
Written back during the year
As at
31/12/2020 Reversals or
write-off
others
Real estate development
projects
Developed products 268941.60 -- -- -- 268941.60
Non real estate development
projects
Raw material 240000.00 -- -- -- 240000.00
Finished products 38891.91 -- -- -- 38891.91
Total 547833.51 -- -- -- 547833.51
Provision for impairment of inventories (continued)
Item
The basis for determining the net realizable
value/residual consideration and the costs to be
incurred
The cause of inventory
depreciation provision for the
current period
Developing costs
The estimated selling price of the inventory minus the
estimated costs upon completion the estimated selling
expenses and the related taxes
--
Developed products
The estimated selling price of the inventory less the
estimated selling cost and related taxes
--
Raw materials
The estimated selling price of the inventory minus the
estimated costs upon completion the estimated selling
expenses and the related taxes
--
Item
The basis for determining the net realizable
value/residual consideration and the costs to be
incurred
The cause of inventory
depreciation provision for the
current period
Finished products
The estimated selling price of the inventory less the
estimated selling cost and related taxes
--
Construction in progress
The estimated selling price of the inventory minus the
estimated costs upon completion the estimated selling
expenses and the related taxes
--
（3）Note of the capitalized amount of borrowing costs in the ending inventory balance:
As at 31/12/2020 the Group's inventory balance contains the amount capitalized on the borrowing costs
with RMB 3497172.46 (As at 31/12/2019 RMB 4910251.90).
（4）Developing costs
Ttem
Starting
time
Finished
time
Estimated
total
investment
As at 31/12/2020 As at 31/12/2019
Provision for
inventory
devaluation
ShanTou Fresh
Peak Building
-- -- -- 25291908.11 25291908.11 --
TianYue Bay No.2 2015 2021 65485.00 531297183.14 375133765.74 --
Total 556589091.25 400425673.85 --
（5）Developed products
Item
Finished
time
As at 1/1/2020 Increase Decrease As at 31/12/2020
Provision
for
inventory
devaluation
Jinye Island Multi-tier
villa
1997 39127219.14 -- -- 39127219.14 --
Jinye Island villa
No.10
2010 3527928.93 1923416.41 63968.63 5387376.71 --
Jinye Island villa
No.11
2008 4341162.49 -- 2007881.07 2333281.42 --
YueJing dongfang
Project
2014 7846006.07 -- 118459.23 7727546.84 --
Wenjin Garden 92212.77 -- 69014.40 23198.37 --
HuaFeng Building 1631743.64 -- -- 1631743.64 --
HuangPu XinCun 729430.00 - 589430.00 140000.00 --
XingHu Garden 156848.69 -- -- 156848.69 --
Shenfang Shanglin
Garden
2014 10206656.46 -- -- 10206656.46 268941.60
Beijing Fresh Peak
Buliding
304557.05 -- -- 304557.05 --
TianYue Bay No.1 2017 475748123.14 - 140727414.13 335020709.01 --
Shengfang CuiLin
Building
2018 99946066.54 - 44162300.76 55783765.78 --
Chuanqi Donghu 2019 416472716.72 - 213123315.79 203349400.93 --
Total 1060130671.64 1923416.41 402650376.34 659403711.71 268941.60
7、Other non-current assets
Item As at 31/12/2020 As at 31/12/ 2019
Income tax prepaid or overpaid 68880760.27 84000516.75
VAT prepaid 25577294.63 10211601.86
Deductible input VAT 4741378.98 4741727.70
LAT prepaid 2083793.61 2617779.37
Business tax prepaid 312287.17 353427.19
Others 1311620.13 856802.61
Total 102907134.79 102781855.48
8、Long-term equity investments
Investee
Balance
as at 31/12/2019
Movements during the year
Balance as at
31/12/2020
Balance of
provision for
impairment as
at 31/12/2020
Additional
investment
Reduce
investment
Investment
gains and
losses
confirmed
by the
equity
method
Adjustment of
other
comprehensive
income
Changes
in other
equity
The
issuance
of profit
Impairment Other
① Joint ventures
Guangdong province
Huizhou Luofu Hill Mineral
Water Co.Ltd
9969206.09 -- -- -- -- -- -- -- -- 9969206.09 9969206.09
Fengkai Xinhua Hotel 9455465.38 -- -- -- -- -- -- -- -- 9455465.38 9455465.38
Subtotal 19424671.47 -- -- -- -- -- -- -- -- 19424671.47 19424671.47
②Associates
Shenzhen Ronghua JiDian
Co.ltd
1546793.29 -- -- -92349.00 -- -- -- -- -- 1454444.29 1076954.64
Shenzhen Runhua
Automobile trading Co.Ltd
1445425.56 -- -- -- -- -- -- -- -- 1445425.56 1445425.56
Dongyi Real Estate Co. Ltd 30376084.89 -- -- -- -- -- -- -- -- 30376084.89 30376084.89
Subtotal 33368303.74 -- -- -92349.00 -- -- -- -- -- 33275954.74 32898465.09
③Other equity investments
Paklid Limited 201100.00 -- -- -- -- -- -- -- -- 201100.00 201100.00
Bekaton Property Limited 906630.00 -- -- -- -- -- -- -- -- 906630.00 906630.00
Shenzhen Shenfang
Department Store Co. Ltd.
10000000.00 -- -- -- -- -- -- -- -- 10000000.00 10000000.00
Shantou Fresh Peak
Building
58547652.25 -- -- -- -- -- -- -- -- 58547652.25 58547652.25
Investee
Balance
as at 31/12/2019
Movements during the year
Balance as at
31/12/2020
Balance of
provision for
impairment as
at 31/12/2020
Additional
investment
Reduce
investment
Investment
gains and
losses
confirmed
by the
equity
method
Adjustment of
other
comprehensive
income
Changes
in other
equity
The
issuance
of profit
Impairment Other
Guangdong Province
Fengkai Lian Feng Cement
Manufacturing Co. Ltd
56228381.64 -- -- -- -- -- -- -- -- 56228381.64 56228381.64
Jiangmen Xinjiang Real
Estate Co. Ltd
9037070.89 -- -- -- -- -- -- -- -- 9037070.89 9037070.89
Xi’an Fresh Peak Property
Trading Co. Ltd
32840729.61 -- -- -- -- -- -- -- 32840729.61 32840729.61
Subtotal 167761564.39 -- -- -- -- -- -- -- 167761564.39 167761564.39
Total 220554539.60 -- -- -92349.00 -- -- -- -- 220462190.60 220084700.95
Note:
Other equity investments are the equity of the company's subsidiaries not included in the scope of the consolidation. These subsidiaries may or have completed
the cancellation procedures but the company has not written off its long-term equity investment or they ceased operations many years ago and the company
has no longer existed the company has been unable to implement effective control over it. Refer to Note VII for details.9、Other equity instrument investments
Item As at 31/12/2020 As at 31/12/2019
Shantou Small &Medium Enterprises Financing
Guarantee Co. Ltd
13508202.32 13229501.03
Yunnan KunPeng Flight service Co.Ltd 24002658.19 19897229.01
Total 37510860.51 33126730.04
Note: Since the above equity instruments are investments that the Group plans to hold for a long time
for strategic purposes the group designates them as financial assets measured at fair value and their
changes recorded in other comprehensive income.Item
Dividend income
recognized for
the current
period
The
cumulative
gains
The
cumulative
loss
The amount of
other
comprohensive
reserve
transferred into
retained earnings
Tranfering
reasons
Shantou Small &Medium
Enterprises Financing
Guarantee Co. Ltd
599760.00 4044060.00 -- -- --
Yunnan KunPeng Flight
service Co.Ltd
-- 1653305.67 -- -- --
10. Investment properties
(1) Investment properties measured using the cost model
Item Buildings Land use rights Total
Ⅰ.Cost
1.Balance as at 31/12/2019 1043243872.75 107528851.63 1150772724.38
2.Additions during the year 11488020.87 - 11488020.87
（1）Transfers from inventory 11488020.87 -- 11488020.87
（2）Others(exchange fluctuation) -- -- --
3. Decrease during the year -- 6956189.72 6956189.72
（1）Others(exchange fluctuation) -- 6956189.72 6956189.72
4.Balance as at 31/12/2020 1054731893.62 100572661.91 1155304555.53
Ⅱ.Accumulated depreciation or amortization
1.Balance as at 31/12/2019 416148333.67 -- 416148333.67
2.Charge for the year 26117379.30 -- 26117379.30
（1）Depreciated or amortised 26117379.30 -- 26117379.30
3. Reductions during the year -- -- --
4.Balance as at 31/12/2020 442265712.97 -- 442265712.97
III.Provision for impairment
1.Balance as at 31/12/2019 14128544.62 88253945.89 102382490.51
2.Charge for the year - -
（1）Other additions(exchange fluctuation) -
3. Reductions on disposals 5709269.48 5709269.48
Item Buildings Land use rights Total
（1）Others(exchange fluctuation) 5709269.48 5709269.48
4.Balance as at 31/12/2020 14128544.62 82544676.41 96673221.03
IV.Carrying amounts
1.As at 31/12/2020 598337636.03 18027985.50 616365621.53
2.As at 31/12/2019 612966994.46 19274905.74 632241900.20
Note: The original value of land use right and the amount of the increase of the impairment provision are
caused by the exchange rate changes in the translation of foreign currency statements.
11. Fixed assets
Item As at 31/12/2020 As at 31/12/2019
Fixed assets 28039978.43 30522035.11
Fixed assets to be disposed of -- --
Total 28039978.43 30522035.11
(1) Fixed assets
①Fixed assets
Item Plant & buildings Motor vehicles
Electronic
equipment &
others
Total
Ⅰ.Cost
1.Balance as at 31/12/2018 107110751.42 10441067.49 13926522.79 131478341.70
2.Additions during the year 589430.00 185191.43 712467.41 1487088.84
（1）Purchases 185191.43 712467.41 897658.84
（2）Others 589430.00 -- -- 589430.00
3. Decrease during the year -- 184700.00 993178.34 1177878.34
（1）Disposals or written-offs -- 184700.00 993178.34 1177878.34
4.Balance as at 31/12/2020 107700181.42 10441558.92 13645811.86 131787552.20
II.Accumulated depreciation:
1.Balance as at 31/12/2019 80644047.51 8945201.13 11367057.95 100956306.59
2.Charge for the year 2875611.18 280032.75 681148.82 3836792.75
(1)Provision 2875611.18 280032.75 681148.82 3836792.75
3.Reductions for the year -- 166230.00 879295.57 1045525.57
(1)Disposal or written-offs -- 166230.00 879295.57 1045525.57
4.Balance as at 31/12/2020 83519658.69 9059003.88 11168911.20 103747573.77
III.Provision for impairment
IV.Carrying amount
1.As at 31/12/2020 24180522.73 1382555.04 2476900.66 28039978.43
2.As at 31/12/2019 26466703.91 1495866.36 2559464.84 30522035.11
12. Intangible assets
(1)Intangible assets
Item Software Total
I.Cost
1.Balance as at 31/12/2019 2241800.00 2241800.00
2.Additions during the year -- --
3.Decrease during the year -- --
4.Balance as at 31/12/2020 2241800.00 2241800.00
II.Accumulative amortisation
1.Balance as at 31/12/2019 2241800.00 2241800.00
2.Charge for the year -- --
3.Reduction for the year -- --
4.Balance as at 31/12/2020 2241800.00 2241800.00
III.Provision for impairment
IV.Carrying amount
1.As at 31/12/2020 -- --
2.As at 31/12/2019 -- --
13. Long-term deferred expenses
Item As at 31/12/2019
Additions
during the year
Decreases during the year
As at
31/12/2020 Amortisation for the
year
Others
decreases
Improvement 162125.72 -- 100458.19 -- 61667.53
Others -- -- - --
Total 162125.72 -- 100458.19 -- 61667.53
14. Deferred tax assets and deferred tax liabilities
(1) Deferred tax assets and deferred tax liabilities not offsetting
Item
As at 31/12/2020 As at 31/12/2019
(1) Deductible or
taxable temporary
differences
Deferred tax
assets/ deferred
tax liabilities
(2) Deductible or
taxable
temporary
differences
Deferred tax
assets/ deferred
tax liabilities
Deferred tax assets:
Provisions for impairment of assets 6549009.33 1637252.34 5157896.86 1289474.22
Deductible tax losses 48676321.03 12169080.25 46877417.46 11719354.37
Provision for land appreciation tax 334846723.41 83711680.85 83816495.81 20954123.95
Unrealized profits of intra-group
transactions
40305039.22 10076259.81 29309607.92 7327401.98
Arrcual of contractual cost 20603882.91 5150970.73 20603882.91 5150970.73
Sub-total 450980975.90 112745243.98 185765300.96 46441325.25
Deferred tax liabilities:
Item
As at 31/12/2020 As at 31/12/2019
(1) Deductible or
taxable temporary
differences
Deferred tax
assets/ deferred
tax liabilities
(2) Deductible or
taxable
temporary
differences
Deferred tax
assets/ deferred
tax liabilities
Interest on unexpired 18361143.19 4590285.80 3950685.00 987671.25
Changes in fair value of other equity
instruments
20046619.77 5011654.94 15662489.30 3915622.33
Sub-total 38407762.96 9601940.74 19613174.30 4903293.58
(2)Details of unrecognized deferred tax assets
Item As at 31/12/2019 As at 31/12/1918
Deductible tax losses 21878078.42 31568944.69
Bad debt provision 217879386.20 218911499.52
Provision for impairment of long-term
equity investments
220084700.95 220084700.95
Provision for impairment of investment
properties
96673221.03 102382490.51
Total 556515386.60 572947635.67
Note: Due to the uncertainty of whether sufficient taxable income can be obtained in the future there is
no confirmation of deductible temporary differences and deductible losses on deferred tax assets.
(3) Expiration of deductible tax losses for unrecognised deferred tax assets
Year As at 31/12/2020 As at 31/12/2019 Note
2020 —— 9692495.52
2021 11349323.06 11349323.06
2022 5753184.38 5753184.38
2023 4085485.24 4085485.24
2024 688456.49 688456.49
2025 1629.25 ——
Total 21878078.42 31568944.69
15. Short-term loans
(1) Short-term loans by category
Category As at 31/12/2020 As at 31/12/2019
Pledged loans 76893995.94 51647260.17
Total 76893995.94 51647260.17
Note: The loan at the end of the period is the result of the Group's application for factoring borrowings
with accounts receivable and the non-termination confirmation of the discount of commercial
acceptance bills receivable.
16. Accounts payable
Item As at 31/12/2020 As at 31/12/2019
Payable for construction 174552420.54 241850173.72
Others 2374193.74 2374304.74
Total 176926614.28 244224478.46
17. Advances from customers
Item As at 31/12/2019 As at 31/12/2018
Advances for properties —— 151031759.13
Advances for construction —— 1805298.78
Advances for Import and export agent payment 4218370.69 4218370.69
Others 1721721.46 2427081.83
Total 5940092.15 159482510.43
18、Contractual liabilities
Item 2020.12.31 2020.01.01 2019.12.31
Advances from properties sales 196619100.77 145206409.25 ——
Advances from room fees 167876.42 199135.90 ——
Advances from property management fees -- 268374.46 ——
Advances from construction -- 1805298.78 ——
Other -- -- ——
Less: Contractual liabilities that are included in
other non-current liabilities
-- -- ——
Total 196786977.19 147479218.39 ——
19. Employee benefits payable
Item
As at
31/12/2019
Accrued during
the year
Decreased
during the year
As at
31/12/2020
Short-term employee benefits 53817671.14 166271915.30 159713901.52 60375684.92
Post-employment benefits - defined
contribution plans
91905.35 5226611.98 5226368.16 92149.17
Total 53909576.49 171498527.28 164940269.68 60467834.09
（1）Short-term employee benefits
Item
As at
31/12/2019
Accrued during
the year
Decreased during
the year
As at
31/12/2020
Salaries bonus allowances 52543725.42 150532574.50 143894320.04 59181979.88
Staff welfare 37800.00 2643024.26 2643024.26 37800.00
Social insurances 1578.57 4058527.39 4058255.52 1850.44
Including：1、Medical insurance 1503.22 3700092.71 3700336.53 1259.40
2、Work-related injury insurance 591.04 5477.87 5477.87 591.04
3、Maternity insurance -515.69 352956.81 352441.12 0.00
Housing Fund 583666.83 6050015.37 6050015.37 583666.83
Labor union fees staff and workers’ 650900.32 2987773.78 3068286.33 570387.77
Item
As at
31/12/2019
Accrued during
the year
Decreased during
the year
As at
31/12/2020
education fee
Total 53817671.14 166271915.30 159713901.52 60375684.92
(2) Defined contribution plans
Item
As at
31/12/2019
Accrued during
the year
Decreased during
the year
As at
31/12/2020
Post-employment benefits 91905.35 5226611.98 5226368.16 92149.17
Including: 1．Basic pension insurance 75075.11 807634.67 807390.85 75318.93
2．Unemployment insurance 914.12 48192.64 48192.64 914.12
3．Annuity 15916.12 4370784.67 4370784.67 15916.12
Total 91905.35 5226611.98 5226368.16 92149.17
20. Taxes payable
Item As at 31/12/2020 As at 31/12/2019
Corporate income tax 116073629.88 51397791.31
Land appreciation tax 339492860.89 521540610.07
Value-added tax 2225243.79 10221416.88
Individual Income Tax 1067279.80 1049224.90
City maintenance and construction tax 240165.30 632944.99
Property tax 272984.08 262015.56
Education surcharge 180666.76 335721.66
Local education surcharge 11963.23 119929.86
Others 144853.22 141160.13
Total 459709646.95 585700815.36
21、Other payables
Item As at 31/12/2020 As at 31/12/2019
Interest payables 16535277.94 16535277.94
Dividend payables -- --
Other payables 260569851.80 260783896.59
Total 277105129.74 277319174.53
(1)Interest payables
Item As at 31/12/2020 As at 31/12/2019
Non-financial institution borrowing interest (interest
payable to parent company)
16535277.94 16535277.94
Significant overdue interest as follows:
Debtor Overdue amount Overdue reason
Shenzhen Invetment Holdings Co. Ltd. 16535277.94 Defer payment
Note: The principal of the loan was fully repaid on 22 December 2016.
(2) Other payables
Item As at 31/12/2020 As at 31/12/2019
Provision for land appreciation tax 59789921.48 59710423.57
Crrent account of related parties 18119380.19 12549466.41
Deposits 100280051.56 105828118.27
Others 82380498.57 82695888.34
Total 260569851.80 260783896.59
Including significant other payables aging over 1 year
Item Amount Reason for no repayment
Provision for land appreciation tax 59789921.48 Payment has not been settled
22、Other current liabilities
Item 2020.12.31 2020.1.1 Adjustments at the beginning 2019.12.31
Other 8917027.07 5884608.14 5884608.14 ——
Total 8917027.07 5884608.14 5884608.14 ——
Note: According to the new revenue accounting policy the VAT in the “Advances from customers”
account is recorded in the "other current liabilities" in the current period.
23. Long-term payables
Item As at 31/12/2020 As at 31/12/2019
Long-term payables 7480233.43 7499192.92
Total 7480233.43 7499192.92
(1) Long-term payables
Item As at 31/12/2020 As at 31/12/2019
Maintenance fund 7480233.43 7499192.92
24. Share capital (Unit: ten thousand shares)
Investor
As at
31/12/2019
Issued
shares
Bonus
shares
Provident fund
increase shares
Others Subtotal
As at
31/12/2020
Total number of shares 101166.00 -- -- -- -- -- 101166.00
25. Capital reserve
Item As at 31/12/2019
Additions during the
year
Reductions during the
year
As at 31/12/2020
Share premium 557433036.93 -- -- 557433036.93
Other capital reserves 420811873.18 -- -- 420811873.18
Total 978244910.11 -- -- 978244910.11
26. Other comprehensive income
Item
As at
2019.12.31
(1)
Movements during the year
As at 2019.12.31
（3）=（1）+
（2）
Before-tax
amount
Less: The current
transfer of other
comprehensive income
into profit and loss is
included in the prior
period
Less: income
tax expense
Net-of-tax amount
attributable to
shareholders of the
Company (2)
Net-of-tax amount
attributable to
non-controlling
interests
I. Items that will not be reclassified
to profit or loss
11746866.97 4384130.47 1096032.62 3288097.86 15034964.83
1. Changes in fair value of other equity
instruments
11746866.97 4384130.47 1096032.62 3288097.86 15034964.83
II.Items that may be reclassified to
profit or loss
9084137.16 4043948.14 - - 4043948.14 1733120.63 13128085.30
1. Translation differences arising from
translation of foreign currency financial
statements
9084137.16 4043948.14 4043948.14 1733120.63 13128085.30
Total 20831004.13 8428078.61 - 1096032.62 7332046.00 1733120.63 28163050.13
27. Surplus reserve
Item As at 31/12/2019
Additions during
the year
Reductions
during the year
As at 31/12/2020
Statutory surplus reserve 191222838.94 27501434.73 -- 218724273.67
Discretionary surplus reserve -- -- -- --
Total 191222838.94 27501434.73 -- 218724273.67
28. Retained earnings
Item
Year ended
31/12/2020
Year ended
31/12/2019
Appropriation or
distribution
percentage
Retained earnings as at the beginning of the year
(before adjustment)
1464915816.81 1235884122.72 --Total adjustments for opening retained earnings（“+” forincrease; “–” for decrease）
-25355845.72 --
Retained earnings as at the beginning of the year
(after adjustment)
1464915816.81 1210528277.00 --
Add: Net profits for the year attributable to shareholders
of the Company
290229772.23 552452307.59 --
Less: Appropriation for statutory surplus reserve 27501434.73 95732767.78 10.00
Dividends payable to ordinary shares 166923900.00 202332000.00 --
Retained earnings as at the year ended 1560720254.31 1464915816.81 --
29. Operating income and operating cost
(1) Operationg income and operating cost
Item
2020 2019
Revenue Cost Revenue Cost
Principal activities 1602794163.58 793896680.56 2533402850.39 944347757.51
Other operating
activities
12215550.30 11611768.12 15337469.10 13404895.03
Total 1615009713.88 805508448.68 2548740319.49 957752652.54
(2) Operating activities (classified by industries)
Industry
2020 2019
Operating income Operating cost Operating income Operating cost
Real estate 1158411393.81 387659747.71 2017872864.14 497310023.38
Construction 251454463.43 244511214.58 304837313.46 298315846.77
Property
management
151968675.51 139937487.12 157665638.01 142261602.88
Lease 63254584.48 35984852.34 86484133.79 45173891.05
Sub-total 1625089117.23 808093301.75 2566859949.40 983061364.08
Less: internal offset 22294953.65 14196621.19 33457099.01 38713606.57
Total 1602794163.58 793896680.56 2533402850.39 944347757.51
(3) Operating activities(classified by geographical areas)
Region
2020 2019
Operating income Operating cost Operating income Operating cost
Domestic： 1624250104.98 807403891.75 2566271187.43 983061364.08
Guangdong: 1613933749.67 799028972.30 2491373238.76 909413682.44
Others: 10316355.31 8374919.45 74897948.67 73647681.64
Overseas： 839012.25 689410.00 588761.97
USA 839012.25 689410.00 588761.97
Sub-total 1625089117.23 808093301.75 2566859949.40 984319212.90
Less: internal offset 22294953.65 14196621.19 33457099.01 38713606.57
Total 1602794163.58 793896680.56 2533402850.39 944347757.51
（4）the breakdown of operating income breakdown
Item
2020
total
Real estate Construction Management lease other
Principal operating
income
1158411393.81 245494191.09 140961331.35 57927247.33 1602794163.58
among: confirm at a
certain point in time
1158411393.81
1158411393.81
Confirm at a certain time 245494191.09 140961331.35 57927247.33 444382769.77
Other operating income 12215550.30 12215550.30
Total 1158411393.81 245494191.09 140961331.35 57927247.33 12215550.30 1615009713.89
30. Taxes and surcharges
Item 2020 2019
Land appreciation tax 311880157.14 725378098.62
Property tax 7554272.86 9522347.24
Urban maintenance and construction tax 5098758.97 8326655.33
Education surcharge 2261494.65 3646297.05
Local education surcharge 1372146.74 2266337.54
Embankment protection fees 1795236.14 1874192.43
Total 329962066.50 751013928.21
Note: The criteria of taxes and surcharges accrued and paid refer to Note IV. Taxation.
31. Selling and distribution expenses
Item 2020 2019
Sales agency fees and commissions 44260043.83 64830444.01
Advertising expenses 2646392.11 5292324.97
Employee benefits 6493766.61 4002688.15
Business expenses 2131882.24 935889.90
Others 457312.43 4418906.99
Total 55989397.22 79480254.02
32. General and administrative expenses
Item 2020 2019
Employee benefits 64704357.03 49342369.86
Depreciation 3850384.39 2901508.29
Business Hospitality 2167046.29 2601004.99
Intermediary fee 12450245.35 2862135.59
Administrative expenses 1831836.07 1949136.92
Water and electricity charges 431830.71 412641.47
Repair charge 717959.58 660950.10
Other amortization 436258.47 486466.27
Travel expense 297270.72 329477.95
Others 6729038.14 7308927.26
Total 93616226.75 68854618.70
33. Financial expenses
Item 2020 2019
Interest expenses -- 38642.51
Less: Interest capitalized -- --
Interest income 30130066.10 19686882.13
Exchange losses/(gains) 7808608.84 -1744304.53
Less: Exchange losses and gains capitalized -- --
Bank charges and others 815772.21 486394.95
Total -21505685.05 -20906149.20
34. Other income
Item (Source of other income) 2020 2019
Related to assets/
income
Input VAT deduction 174534.77 1163713.00 Income
Subsidies of steable post 125750.12 4414.90 Income
Epidemic prevention subsidies 3245019.09 -- Income
VAT relief 1062301.22 -- Income
Relief of VAT from simple method 166.87 -- Income
Total 4607772.07 1168127.90
Note:
(1) For details of government grants please refer to Note XIII.1.
35. Investment income
Item 2020 2019
Income from long-term equity investments accounted for using
the equity method
-92348.97 75629.25
Item 2020 2019
Dividend from investments in other equity instruments 599760.00 928200.00
Income from structured deposit 15217058.60 31425651.98
Total 15724469.63 32429481.23
36. Credit impairment losses（"-" for losses）
Item 2020 2019
Provision for impairment of bill receivables -1865160.28 --
Provision for impairment of account receivables 1380875.47 -2184042.21
Provision for impairment of financial receivables -- --
Provision for impairment of other receivables 125285.66 -927215.23
Total -358999.15 -3111257.44
37. Impairment losses ("-" for losses)
Item 2020 2019
Provision for impairment of receivables -- --
Provision for impairment of long-term equity investments -- -12166897.84
Total -- -12166897.84
38. Gains from assets disposal ("-" for losses)
Item 2020 2019Gains from disposals of fixed assets (“-’’ for losses) 11429.23 --Total 11429.23 --
39. Non-operating income
Item 2020 2019
Amount included in non-recurring gains or
losses for the year ended 31/12/2020
Gains on Compensation 30000000.00 30000000.00
Gains on penalty 670000.10 1152266.31 670000.10
Other 2600.16 193162.18 2600.16
Gains on waste 21161.31 21161.31
Total 30693761.57 1345428.49 30693761.57
Note: The compensation of 30 million RMB received in the current period is for the Company to
terminate the planning of major asset restructuring in accordance with the agreement to receive
compensation from the restructuring parties.
40. Non-operating expenses
Item 2020 2019
Amount included in
non-recurring gains or losses for
the year ended 31/12/2020
Donations 89121.31 30000.00 89121.31
Loss in damage and scrap of non-current assets 69581.08 169935.95 69581.08
Item 2020 2019
Amount included in
non-recurring gains or losses for
the year ended 31/12/2020
Fines -- 1445.39 --
Others 1525401.58 25185.46 1525401.58
Total 1684103.97 226566.80 1684103.97
41. Income tax expenses
(1) Details of income tax expenses
Item 2020 2019
Current tax expense for the year based on tax law and regulations 173172138.96 81384471.24
Changes in deferred tax assets/liabilities -62701304.18 109401829.46
Total 110470834.78 190786300.70
(2) Reconciliation between income tax expenses and accounting profit is as follows:
Item 2020 2019
Profits before tax 400433589.16 731983330.76
Expected income tax expenses at applicable tax rate (profits before tax 25 %) 100108397.29 182995832.69
Effect of different tax rates applied by subsidiaries -523491.63 5114261.95
Effect on income tax for previous periods -- --
Effect of gains or losses from joint ventures and associates accounted for using the
equity method
-126852.76 -30453128.98
Effect of non-deductible costs expenses and losses 15046324.88 21337044.56
Effect of using the deductible temporary differences or deductible losses for whichno deferred tax asset was recognized in previous (expressed in “-”)）
-4257625.20 -661881.43
Effect of deductible temporary differences or deductible losses for which no deferred
tax asset
692907.43 12454171.91
Relief on business income tax -468825.23 --
Income tax expenses 110470834.78 190786300.70
42、Notes to the cash flow statements
（1）Proceeds from other operating activities
Item 2020 2019
Interest income 11768922.91 15906764.91
The collecting and paying on another's behalf -- 8051762.09
Current account and Others 42259017.80 55720858.47
Total 54027940.71 79679385.47
（2）Payment for other operating activities
Item 2020 2019
Charges 815772.21 682722.12
Item 2020 2019
Cash paid expenses 72468127.90 97554049.46
Current account and Others 1291173.09 8702866.87
Total 74575073.20 106939638.45
（3）Proceeds from other investing activities
Item 2020 2019
Restricted cash recoverd in the current period –
structured deposit
1000000000.00 2200000000.00
（4）Payment for other investing activities
Item 2020 2019
Restricted cash paid in the current period
–structured deposit
-- 2300000000.00
43. Supplementary information on cash flow statement
(1) Supplement to cash flow statement:
Supplement information 2020 2019
1、Reconciliation of net profit/loss to cash flows from operating
activities：
Net profit 289962754.38 541197030.06
Add: Provisions for impairment of assets -- 12166897.84
Provisions for impairment of credit 358999.15 3111257.44
Depreciation of fixed assets depreciation of investment properties 29954172.05 28907809.32
Amortization of intangible assets -- --
Amortization of long-term deferred expenses 100458.19 224941.19
Losses from disposal of fixed assets intangible assets and other long-term
assets ("-" for gains)
-11429.23 --
Loss from scrapping of fixed assets ("-" for gains) 69581.08 169935.95
Losses from changes in fair value ("-" for gains) -- --
Financial expenses ("-" for income) 647689.01 38642.51
Losses arising from investment ("-" for gains) -15724469.63 -32429481.23
Decrease in deferred tax assets ("-" for increase) -66303918.73 108102463.55
Increase in deferred tax liabilities ("-" for decrease) 3602614.55 987671.25
Decrease in inventories ("-" for increase) 231291659.65 190315523.14
Decrease in operating receivables ("-" for increase) -54000863.50 -136075098.50Increase in operating payables ("-" for decrease） -134783233.80 -113109867.77
Others -- --
Net cash flows from operating activities 285164013.17 603607724.75
2、Investing and financing activities not requiring the use of cash:
Conversion of debt into capital -- --
Convertible bonds due within one year -- --
Supplement information 2020 2019
Acquisition of fixed assets under finance leases -- --
3、Change in cash and cash equivalents： -- --
Cash as at the year ended 2669103926.82 1507189760.35
Less: cash as at the beginning of the year 1507189760.35 1148522435.93
Add: cash equivalents as at the year ended -- --
Less: cash equivalents as at the beginning of the year -- --
Net increase in cash and cash equivalents 1161914166.47 358667324.42
(2) Details of cash and cash equivalents
Item 2020 2019
1.Cash 2669103926.82 1507189760.35
Including: Cash on hand 61121.83 66252.42
Bank deposits available on demand 1026042804.99 1493123507.93
Other monetary funds available on demand 1643000000.00 14000000.00
Deposits made to the central bank for payment -- --
Deposit of funds from the same industry -- --
Dismantling interbank payments -- --
2. Cash equivalents -- --
Including: bond investments due within three months -- --
3. Cash and cash equivalents as at 31/12/2019 2669103926.82 1507189760.35
Including: The parent company or in-group subsidiary uses restricted
cash and cash equivalents
45. Assets with restrictive ownership title or right of use
Item As at 31/12/2020 Reason for restriction
Accounts receivable 49686095.76 Short-term loan pledge
BIlls receivable 30068561.31
Endorsement or discount of an unexposed commercial
acceptance bill of exchange
Total
79754657.07
46. Foreign currency translation
（1）Items in Foreign currency
Item Original Exchange rate Amount (RMB)
Cash at bank and on hand
Including: USD 20831.05 6.5249 135920.52
HKD 7798819.95 0.84164 6563798.82
Accounts receivable
Including: HKD 4905150.10 0.84164 4128370.53
Other receivables
Including: HKD 20165086.70 0.84164 16971743.57
Item Original Exchange rate Amount (RMB)
Other payables
Including: USD 722044.70 6.5249 4711269.46
HKD 15918034.59 0.84164 13397254.63
47、Government subsidies
(1) The use of the total amount method to include the current period profit and loss of government subsidies
Subsidy programs Type
Amount of profit
and loss
included in the
last period
Amount of
profit and loss
included in the
current period
Items
reported for
profit and
loss
Relate to a
ssets/ relate
to income
Steady-duty subsidies Government funding 4414.90 125750.12 Other income Income
Epidemic prevention
subsidies
Government funding -- 3245019.09 Other income income
VI. Change of consolidation scope
There is no change in consolidation scope during the current period.VII.Interest in other entities
1. Interests in subsidiaries
(1) Composition of the Group
Name
Principal
place of
business
Registratio
n place
Business
nature
Shareholding%
Acquisition method
Direct Indirect
Shenzhen City SPG Long Gang
Development Ltd.
Shenzhen Shenzhen
Real estate
development
95.00 5.00
Acquiring through
establishment or
investment
American Great Wall Co. Ltd U.S. U.S.
Real estate
development
70.00 --
Acquiring through
establishment or
investment
Shenzhen City Property
Management Ltd.Shenzhen Shenzhen
Property
management
95.00 5.00
Acquiring through
establishment or
investment
Shenzhen Petrel Hotel Co. Ltd. Shenzhen Shenzhen Hotel Services 68.10 31.90
Acquiring through
establishment or
investment
Shenzhen Zhen Tung
Engineering Ltd.
Shenzhen Shenzhen
Installation and
maintenance
73.00 27.00
Acquiring through
establishment or
investment
Shenzhen City We Gen
Construction Management Ltd.
Shenzhen Shenzhen Supervision 75.00 25.00
Acquiring through
establishment or
investment
Shenzhen Lain Hua Industry
and Trading Co. Ltd.Shenzhen Shenzhen
Mechanical &
Electrical
device
installation
95.00 5.00
Acquiring through
establishment or
investment
Fresh Peak Zhiye Co. Ltd. Hong Kong
Hong
Kong
Investment and
management
100.00 --
Acquiring through
establishment or
investment
Xin Feng Enterprise Co. Ltd. Hong Kong Hong Kong
Investment and
management
100.00 --
Acquiring through
establishment or
Name
Principal
place of
business
Registratio
n place
Business
nature
Shareholding%
Acquisition method
Direct Indirect
investment
Shenzhen City Shenfang Free
Trade Trading Ltd.Shenzhen Shenzhen
Commecial
trade
95.00 5.00
Acquiring through
establishment or
investment
Shenzhen City Shenfang
Investment Ltd.Shenzhen Shenzhen Investment 90.00 10.00
Acquiring through
establishment or
investment
Shenzhen Special Economic
Zone Real Estate (Group)
Guangzhou Property and
Estate Co. Ltd.
Shenzhen Shenzhen Real estate 95.00 5.00
Acquiring through
establishment or
investment
Beijing fresh peak property
development management
limited company
Beijing Beijin Real estate 75.00 25.00
Acquiring through
establishment or
investment
Note:
① 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 debet for the companies outside the
consolidation scope.② The cancelled revoked and closed subsidiaries of the Company that are not included in the scope
of consolidation are as follows:
Name
Principal
place of
business
Registration
place
Business nature
Shareholding%
Acquisition method
Direct Indirect
Shenzhen Shenfang Department
Store Co. Ltd
Shenzhen Shenzhen Commecial trade 95.00 5.00
Acquiring through
establishment or
investment
Paklid Limited
Hong
Kong
Hong Kong Commecial trade 60.00 40.00
Acquiring through
establishment or
investment
Bekaton Property Limited Australia Australia Real estate 60.00 --
Acquiring through
establishment or
investment
Canada Great Wall ( Vancouver) Canada Canada Real estate -- 60.00
Acquiring through
establishment or
investment
Guangdong Fengkai County
Lianfeng Cement Manufacturing
Co.Ltd.
Fengkai
Guangdon
g
Fengkai
Guangdong
Manufacturing -- 90.00
Acquiring through
establishment or
investment
Jiangmen Xinjiang Real Estate Co.Ltd
Jiangmen
Guangdon
g
Jiangmen
Guangdong
Real estate -- 90.91
Acquiring through
establishment or
investment
Xi’an Fresh Peak Property Trading
Co. Ltd
Xi’an
Shanxi
Xi’an Shanxi Real estate -- 67.00
Acquiring through
establishment or
investment
Name
Principal
place of
business
Registration
place
Business nature
Shareholding%
Acquisition method
Direct Indirect
Shenxi Limited Shenzhen Shenzhen
Building
Decoration
70.00 --
Acquiring through
establishment or
investment
Shenzhen Zhentong New
Electromechanical Industry
Development Co. Ltd.
Shenzhen Shenzhen
Mechanical and
electrical
engineering
95.00 5.00
Acquiring through
establishment or
investment
Shenzhen Real Estate
Electromechanical Management
Company
Shenzhen Shenzhen
Electromechanical
Management
100.00 --
Acquiring through
establishment or
investment
Shenzhen Nanyang Hotel Co. Ltd. Shenzhen Shenzhen
Hotel
Management
95.00 5.00
Acquiring through
establishment or
investment
Shenzhen Kangtailong Industrial
Electric Cooker Co. Ltd.
Shenzhen Shenzhen
Industrial
manufacturing
-- 100.00
Acquiring through
establishment or
investment
Shenzhen Longgang Henggang
Huagang Industrial Co. Ltd.Shenzhen Shenzhen
Industrial
Investment
-- 79.92
Acquiring through
establishment or
investment
Note: 1. Shenzhen Shenfang Department Store Co. Ltd held a shareholders meeting on 29 October
2007 decided to terminate the business and formed a group for liquidation. The liquidation group
issued a liquidation report on 7 December 2007.
2. Paklid Limited Bekaton Property Limited and Canada Great Wall ( Vancouver) they were companies
established by the group overseas in the early years. On 13 December 2000 the gourp held a board of
directors and decided to liquidate these three companies. Bekaton Property Limited and Canada Great
Wall ( Vancouver) the cancellation procedures were completed.
3. All assets from Guangdong Fengkai County Lianfeng Cement Manufacturing Co. Ltd. (including
tangible and intangible asset) was auctioned by the court on 22 January 2006 and it became a shell
company.
4. Shenxi Limited was the Group’s cancelled subsidiary Shenzhen Tefa Real Estate ConsolidatedServices Co. Ltd’s subsidiary By the Group “The notice on the menger of Shenzhen Zhen Tung
Engineering Ltd and Shenxi Limited”（Shenfang [1997] No.19）announcement all businesses form
Shenxi Limited were undertaken by Shenzhen Zhen Tung Engineering Ltd and Shenxi Limited was
revoked on 8 February 2002.These invested companies that have not been included in the consolidation scope were either been
cancelled or ceased operation many years ago and the company entities were no longer exist theGroup could no longer effectively control them. According to “Accounting Standard for Business
Enterprises No. 33-Consolidated Financial Statements” the above companies are not included in the
consolidated scope of the group consolidated financial statement the group already fully provision for
impairment the investment or the book value of the net investment in these companies.(2) Material non-wholly owned subsidiaries
Name
Proportion of
ownership
interest held by
non-controlling
interests %
Profit or loss
allocated to
non-controlling
interests during
the year
Dividend declared
to non-controlling
shareholders
during the year
Balance of
non-controlling
interests as at
31/12/2020
Great Wall Estate Co. Inc 30.00 -232222.50 -- -20359204.37
Fresh Peak Investment Ltd 45.00 -24142.54 -- -116179012.28
Barenie Co. Ltd. 20.00 -10652.81 -- -3887016.41
(3) Key financial information about material non-wholly owned subsidiaries
Name
As at 31/12/2020
Current
assets
Non-current
assets
Total assets
Current
liabilities
Non-
current
liabilities
Total liabilities
Great Wall Estate Co. Inc 135920.52 18027985.50 18163906.02 101822102.87 -- 101822102.87
Fresh Peak Investment Ltd 4769.05 36016.90 40785.95 258216451.81 -- 258216451.81
Barenie Co. Ltd. 985.56 -- 985.56 32895438.31 -- 32895438.31
Continued（1）：
Name
As at 31/12/2019
Current
assets
Non-current
assets
Total assets
Current
liabilities
Non-current
liabilities
Total liabilities
Great Wall Estate
Co. Inc
38598.97 19274905.74 19313504.71 107974695.34 -- 107974695.34
Fresh Peak
Investment Ltd
4817.49 36016.90 40834.39 256573564.93 -- 256573564.93
Barenie Co. Ltd. 1045.70 -- 1045.70 32842234.42 -- 32842234.42
Continued（2）：
Name
2020 2019
Operating
income
Net profit
Total
comprehensive
income
Cash flows from
operating
activities
Operating
income
Net profit
Total
comprehensive
income
Cash flows from
operating
activities
Great Wall Estate Co. Inc 839012.25 -774074.99 -774074.99 -774075.02 588761.97 -273403.83 -- -273403.83
Fresh Peak Investment Ltd -- -53650.12 -53650.12 -- -- -24533.43 -- --
Barenie Co. Ltd. -- -53264.03 -53264.03 -- -- -26367.40 -- --
2. Interests in joint ventures or associates
(1) Summarised financial information of immaterial joint ventures and associates:
Item
As at 31/12/2020 /
Year ended 31/12/2020
As at 31/12/2019 /Year ended
31/12/2019
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 377489.68 469838.65
Aggregate amount of share of -- --
Net profit -92348.97 75629.25
Other comprehensive income -- --
Total comprehensive income -- --
(2) Excess loss from joint ventures or associates
Investee
Accumulated
unrecognized loss in
prior periods
Unrecognized loss (or
share of net profit)for
the year
Accumulated
unrecognized loss as
at 31/12/2020
Shenzhen Fresh Peak property
consultant Co. Ltd
1095961.55 1121994.34 2217955.89
Note: Shenzhen Fresh Peak property consultant Co. Ltd was established on 15 March 1993
Registered capital of 3000000 the group subscribed RMB 600000 (20% in total capital). As at 31
December 2020 the group actually contributed RMB 600000 and already confirmed long-term equity
invent lose RMB 600000.VIII. Financial instruments and risk management
The major financial instruments of the Group include cash at bank and on hand bill receivable
accounts receivable other receivable other current assets other equity instrument account payables
other payables short-term loans，and long-term payables. The details of these financial instruments aredisclosed in the respective notes. The financial risk of these financial instruments and financial
management policies used by the Group to minimize the risk are disclosed as below. The management
manages and monitors the exposure of these risks to ensure the above risks are controlled in the
limited range.
1.Objectives and policies of financial risk management
The Group’s objective in risk management is to obtain an appropriate equilibrium between risk and
return. It also focuses on the unpredictability of financial markets and seeks to minimize potential
adverse effects on the Group’s financial performance. Based on the objectives of financial risk
management certain policies are made to recognize and analyze risk and internal control is designed
according to proper acceptable in order to monitor the risk position of the Group. Both the policies and
internal control will be reviewed and revised regularly to adapt the changes of the market and business
activities of the Group. The performance of internal control will be reviewed regularly or randomly in
accordance with the financial management policies.The Group’s financial instrument risks mainly include credit risk liquidity risk and market risk. (Including
currency risk interest rate risk and commodity price risk)
The board of directors is responsible for planning and establishing the risk management structure of the
Group formulating the Group’s risk management policies and related guidelines supervising the
implementation of risk management measures. The Group has established risk management policies to
identify and analyze the risks faced by the Group. These risk management policies clearly define
specific risks covering market risk credit risk and liquidity risk. The Group regularly assesses changes
in the market environment and the Group’s operating activities to determine whether update risk
management policies and systems.The Group diversifies the risk of financial instruments through appropriate diversified investments and
business combinations and reduces the risk of concentration in a single industry a specific region or a
specific counterparty by developing appropriate risk management policies.
（1）Credit risk
Credit risk refers to the risk that the counterparty to a financial instrument would fail to discharge its
obligation under the terms of the financial instrument and cause a financial loss to the Group.
Credit is managed on the grouping basis. Credit risk is mainly arising from cash at bank accounts
receivable and other receivables.The Group expects that there is no significant credit risk associated with cash at bank since it is
deposited or will be accepted by the sate-owned banks and other medium or large size listed banks.The Group has policies to limit the credit risk exposure on bills receivables accounts receivables and
other receivables. The Group assesses the credit quality of and sets credit limits on its customers by
taking into account their financial position the availability of guarantee from third parties the availability
of guarantee from third parties their credit history and other factors such as current market conditions.The credit history of the customers is regularly monitored by the Group. In respect of customers with a
poor credit history the Group will use written payment reminders or shorten or cancel credit periods to
ensure the overall credit risk of the Group is limited to a controllable extent.The Group’s debtors of account receivables are in different industries and regions the Group continues
on the evaluation of the debtor’s financial status and purchase credit guarantee insurance when
appropriate.The highest credit risk exposed to the Group is limited to the carrying amount of each financial
instrument illustrated in the balance sheet. The Group would not provide any guarantee that might
cause credit risk to the Group.
Among the accounts receivable of the Group the bills receivable and accounts receivable of the top five
customers accounted for 53.79% (2019:53.79%); among the other receivables of the Group the other
receivable of the top five customers accounted for 61.40% (2019:62.80%)
（2）Liquidity risk
Liquidity risk refers to the risks that the Group will not be able to meet its obligations associated with its
financial liabilities that are settled by delivering cash or other financial assets.
Cash flow forecasting is performed by Group’s finance department. The Group’s finance management
monitors cash and cash equivalents to meet operational needs and reduce the effect of floating cash
flow. The department monitors the usage of bank loan so that the Group does not breach borrowing
limits or covenants while maintaining sufficient headroom on its undrawn committed borrowing facilities
from major financial institute to meet the short-term and long-term liquidity requirements.The Group raises working capital from its operations bank and other borrowings. As at 31 December
2020 the amount of bank loans not yet used by the Group is RMB 0.00. (As at 31 December 2020:
RMB 0.00)
The financial assets and liabilities off-balance-sheet guarantee items of the Group at 31 December
2020 are analyzed by their maturity date below at their undiscounted contractual cash flows (RMB in ten
thousand)：
Item
As at 31/12/2020
Within 1 year 1 to 5 years Over 5 years Total amount
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 liabilities 90228.36 748.02 -- 90976.38
The financial assets and liabilities off-balance-sheet guarantee items of the Group at 31 December2019 are analyzed by their maturity date below at their undiscounted contractual cash flows（RMB in tenthousand）：
Item
As at 31/12/2019
Within 1 year 1 to 5 years Over 5 years Total amount
Financial liabilities：
Short-term loans 5164.73 -- -- 5164.73
Accounts payables 24422.45 -- -- 24422.45
Interest payables 1653.53 -- -- 1653.53
Other payables 20051.11 -- -- 20051.11
Long-term payables -- 749.92 -- 749.92
Guarantees for client 47539.67 -- -- 47539.67
Total liabilities 98831.49 749.92 -- 99581.41
The amount of financial liabilities disclosed in the above table is undiscounted contractual cash flow and
may differ from the carrying amount in the balance sheet.The maximum guarantee contract that already signed dose not represent the amount need to paid.
（3）Market risk
Market risk includes interest rate risk and foreign currency risk refers to the risk that the fair value or
future cash flow of a financial instrument will fluctuate because of the changes in market price.Interest rate risk
Interest rate risk refers to the risk that the fair value or future cash flow of a financial instrument will
fluctuate because of the floating rate. Interest rate risk arises from recognized interest-bearing financial
instrument and unrecognized financial instrument (e.g. loan commitments).The Group’s interest rate risk arises from long-term bank loans and other interest-bearing liabilities.
Financial liabilities issued at floating rate expose the Group to cash flows interest rate risk. Financial
liabilities issued at fixed rate expose the Group to fair value interest rate risk. The Group determines the
relative proportions of its fixed rate and floating rate contracts depending on the prevailing market
conditions. At the same time the Group monitors and maintains the combined financial instruments of
fixed rate and floating rate.
During the reporting period the Group operates by its own working capital. As at 31 December 2020
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.
Foreign currency risk
Foreign currency risk refers to the risk that the fair value or future cash flows of a financial instrument
will fluctuate because of changes in foreign currency rates. Foreign currency risk arises from the
functional currency denominated financial instrument measured at individual entity.The foreign currency risk is mainly comes from the group’s financial position and cash flow which is
affected by the fluctuations of the foreign exchange rates. As the subsidiary establish in Hong Kong
SAR and U.S. are using local currency as settlement currency other foreign currency assets and
liabilities held by the Group compare with the group’s total assets and liabilities are insignificant
therefore the Company believe the foreign currency risk is insignificant.
2、Capital risk management
The objectives of the Group’s capital risk management are to safeguard the Group’s ability to continue
as a going concern in order to provide returns for shareholders and benefits for other stakeholders and
to maintain an optimal capital structure to reduce the cost of capital.In order to maintain or adjust the capital structure the Group may adjust the amount of dividends paid to
shareholders return capital to shareholders issue new shares or disposes assets to reduce its
liabilities.The Group monitors capital on the basis of the gearing ratio. This ratio is calculated as net liabilities
divided by total capital. As at 31 December 2020 the group’s debt to asset ratio is 25.92%. (As at 31
December 2019: 28.20%)
IX Fair Value
The level in which fair value measurement is categorized is determined by the level of the fair value
hierarchy of the lowest level input that is significant to the entire fair value measurement. The levels are
defined as follows:
Level 1 inputs: unadjusted quoted prices in active markets that are observable at the measurement date
for identical assets or liabilities.Level 2 inputs: inputs other than Level 1 inputs that are either directly or indirectly observable for
underlying assets or liabilities.Level 3 inputs: inputs that are unobservable for underlying assets or liabilities.
（1）Fair value of assets and liabilities measured at fair value
As at 31/12/2020 assets and liabilities measured at fair value are shown as follows:
Item
Level 1 fair value
measurement
Level 2 fair value
measurement
Level 3 fair value
measurement
Total
I.Recurring fair value
measurement
Other Equity instruments -- -- 37510860.51 37510860.51
Total assets measured at fair value
on a recurring basis
-- -- 37510860.51 37510860.51
（2）Quantitative information about the unobservable inputs used in the fair value measurement that are
significant and are reasonably available.Items
Fair value
As at 31/12/2020
Valuation
techniques
Unobservable inputs
Unlisted equity investments 37510860.51 Net asset method
Book net assets
liquidity discount
（3）Fair values of assets and liabilities not measured at fair value
The financial assets and financial liabilities of the Group measured at amortized cost mainly include:
cash accounts receivable other receivables short-term loans accounts payable other payables and
long-term payable.In addition to above financial assets and liabilities other financial asset and liabilities that not measured
at fair value the differ between book values and fair value are not significant.X. Related parties and related party transactions
1. Information about the parent of the Company
Name Registration place Business nature
Registered
capital (RMB in
ten thousand)
Shareholding
percentage %
Percentage of
voting rights
%
Shenzhen
Invetment Holdings
Co. Ltd.
Shenzhen
Guangdong province
Investment real
estate
development
guarantee
2764900.00 63.55 63.55
The ultimate controlling party of the company is: State-owned Assets Supervision and Management
Commission of Shenzhen Municipal People’s Government
2. Information about the subsidiaries of the Company
For information about the subsidiaries of the Company refer to Note VII.1.
3. Information about joint ventures and associates of the Company
For information about the joint ventures and associates of the Company refer to Note VII.2.
4. Information on other related parties
Name Related party relationship
Shenzhen Jian'an Group Co. Ltd. Same controlling shareholders
Shenzhen Dongfang New world store Co. Ltd Participating stock companies
Shenxi Limited
Not included in Consolidated Financial Statements’ Subsidiary that
had been terminated its licenses by law but not cancellation
Shenzhen Zhentong New Electromechanical
Industry Development Co. Ltd.Not included in Consolidated Financial Statements’ Subsidiary
(Long-term without operation)
Shenzhen Nanyang Hotel Co. Ltd.Not included in Consolidated Financial Statements’ Subsidiary that
had been terminated its licenses by law but not cancellation
Shenzhen Real Estate Electromechanical
Management Company
Not included in Consolidated Financial Statements’ Subsidiary that
had been terminated its licenses by law but not cancellation
Shenzhen Longgang Henggang Huagang
Industrial Co. Ltd.Not included in Consolidated Financial Statements’ Subsidiary that
had been terminated its licenses by law but not cancellation
Director Manager Controller and Secretary of the
Board of Directors
Key managers
5. Transactions with related parties
(1) Purchases/sales
①Purchase of goods/receiving of services
Related party Nature of transaction 2020 2019
Shenzhen RongHua JiDian Co.Ltd Elevator maintenance 1293962.28 1339921.80
②Sales of goods/rendering of services
Related party Nature of transaction Year ended 31/12/2020 Year ended 31/12/2019
Shenzhen Jian'an Group Co. Ltd. Decoration services 7258154.64 2836052.81
Shenzhen RongHua JiDian Co.Ltd Property Services 68772.00 68772.00
(2) Contracting arrangement
① Outsourcing with related parties
Name of main
contractor
Name of
contractor
Type of
assets
under
outsourcing
Reception
date of
contracting
Expiration
date of
contracting
Basis of
pricing of
contracting
income
Contracting
income recognized
in the current year
year
Shantou City
Huafeng Real Estate
Devepment Co. Ltd
Shenzhen
Jian'an Group
Co. Ltd.
Construction
19 October
2018
1 May 2021 Negotiations 182994620.79
(3) Funding from related party
Related party Amount of funding
Reception
date
Expiration date Note
Funds received
Shenzhen Investment
Shareholding Co. Ltd
16535277.94
09 November
2006
22 December
2016
The principal of the loan was
repaid on 22 December 2016 and
the remaining amount was interest
payable.In the end of reporting period interest payable for Shenzhen Investment Shareholding Co. Ltd is
RMB 16535277.94.
(4) Remuneration of key management personnel
The Company has 12 key management personnel in 2020 and 11 key management personnel in 2019.Information about remuneration is as follows:
Item 2020 (RMB in ten thousand) 2019 (RMB in ten thousand)
Remuneration of key management personnel 884.86 902.08
6. Receivables from and payables to related parties
(1) Receivables from related parties
Item Related party
As at 31/12/2020 As at 31/12/2019
Book value
Provision for
bad and
doubtful
debts
Book value
Provision for
bad and
doubtful debts
Accounts
recevible
Shenzhen Fresh Peak
property consultant
Co.Ltd
1144740.49 1144740.49 1205588.76 1205588.76
Other recevibles
Guangdong Province
Huizhou Luofu Hill
Mineral Water Co. Ltd
10465168.81 10465168.81 10465168.81 10465168.81
Other recevibles
Shenzhen Runhua
Automobile Trading Co.
Ltd
3072764.42 3072764.42 3072764.42 3072764.42
Other recevibles
Canada GreatWall（Vancouver）Co. Ltd
89035748.07 89035748.07 89035748.07 89035748.07
Item Related party
As at 31/12/2020 As at 31/12/2019
Book value
Provision for
bad and
doubtful
debts
Book value
Provision for
bad and
doubtful debts
Other recevibles Bekaton Property Limited 12559290.58 12559290.58 12559290.58 12559290.58
Other recevibles Paklid Limited 18870785.54 18870785.54 19319864.85 19319864.85
Other recevibles
Shenzhen Shenfang
Department Store Co.
Ltd.
237648.82 237648.82 237648.82 189179.82
Other recevibles
Shenzhen RongHua
JiDian Co.Ltd
475223.46 23761.17 475223.46 23761.17
Other recevibles
Xi’an Fresh Peak
property management&
Trading Co.Ltd
8419205.19 8419205.19 8419205.19 8419205.19
Other recevibles Shenxi Limited 7660529.37 7660529.37 7660529.37 7660529.37
Other recevibles
Shenzhen Nanyang Hotel
Co. Ltd.
3168721.00 3168721.00 3168721.00 3168721.00
Other recevibles
Shenzhen Jian'an Group
Co. Ltd.
16464.28 823.21
(2) Payables to related parties
Item Related party As at 31/12/2020 As at 31/12/2019
Intrest payables Shenzhen Investment Shareholding Co. Ltd 16535277.94 16535277.94
Accounts payable Shenzhen Jian'an Group Co. Ltd. 54193856.16 68172202.04
Other payables Shenzhen Dongfang New world store Co. Ltd 902974.64 902974.64
Other payables
Guangdong Province Fengkai Lain Feng Cement
Manufacturing Co. Ltd.
1867348.00 1867348.00
Other payables
Shenzhen Real Estate Electromechanical
Management Company
14981420.99 14981420.99
Other payables
Shenzhen Zhentong New Electromechanical Industry
Development Co. Ltd.
8827940.07 8827940.07
Other payables Shenzhen Shenfang Department Store Co. Ltd. 639360.38 639360.38
Other payables
Shenzhen Longgang Henggang Huagang Industrial
Co. Ltd.
165481.09 165481.09
XI. Commitments and contingencies
1. Significant commitments
(1) Capital commitments
Capital commitments have been entered into but not have
not been in the financial statements
As at 31/12/2020 As at 31/12/2019
Material sales or purchases contracts 153945220.09 200684729.85
(2) Information on implementation of commitments in previous year
The detail is set out in Note X.5.(2) Associated Contracting.
As at 31 December 2020 there is no other material commitment to be disclosed.
2. Contingencies
(1) Contingent liabilities arising from pending arbitration and pending litigation and related financial impact
Plaintiff Defendant Case
Appellate
court
Amount of
the object
of action
Progress of
cases
Xi’an Fresh Peak
Holding limited
company
Xi'an Commercial and
Trade Commission
Xi'an Commerce and
Tourism Co. Ltd.Investment
compensation
disputes
Shaanxi Higher
People's Court
36.62 million
yuan and
interest
Pending
Note: Xi’an Fresh Peak Holding limited company (hereinafter referred to as “Fresh Peak Company”) was
sino-foreign joint venture set up in Xi’an city. Among them Fresh Peak Enterprise Co. Ltd made 67% of
the shares in cash. Xi’an Trade Building a company directly under the Xi'an Commercial and Trade
Commission (hereinafter referred to as "Xi'an C&T Commission") invested 16% of the shares in land use
rights. Hong Kong Dadiwang Industrial Investment Company holds 17% of the shares. The core business
was property development. And the project was Xi’an Trade Building. The project was started on 28
November 1995. But the project had been stopped in 1996 because of the two parties differences on the
operating policy of the project. In 1997 the Xi’an government withdrew the Xi'an Fresh Peak investment
project compulsively and assigned the project to Xi’an Business Tourism Co. Ltd (hereinafter referred to
as “Business Tourism Company”). But the two parties had insulted a lawsuit on compensation. The
ShanXi Province High Peoples Court made a judgement “(2000) SJ-CZ No.25”. The judgement was as
follows: 1. Business Tourism Company had to pay for the compensation Rmb 36620 thousand to Xi’an
Fresh Peak Company after the judgment entering into force. If the Business Tourism Company failed to
pay in time it had to pay double debt interests to Xi’an Fresh Peak Company. 2. Xi’an Joint Commission
on Commerce had jointly and severally obligation of the interests of the compensation.
Untill 31 December 2020 the amount of RMB 15201000.00 had been called back. The company has
obtained new property clues submitted an application for resumption of execution this case is still
pending.
As at 31 December 2020 the book value of the long-term equity investment of Xi’an Fresh Peak
Company was RMB 32840729.61. The book balance of assets was RMB 8419205.19. Both have
been taken full provision for impairment loss.
(2) Contingent liabilities arising from guarantee provided to other entities and related financial effects.
As at 31 December 2020 the group has provided mortgage loan guarantee for commercial housing
purchasers in accordance with real estate business rules，totaling 371357900 .00RMB。
Item Duration Amount Note
Shengfang CuiLin Building
Until the Premises Permit mortgage registration is
finished and in bank custody
8532.86
ChuanQi DongHu Building(Fromer
DongHuDiJing Building)
Until the Premises Permit mortgage registration is
finished and in bank custody
6056.20
TianYue Bay No.1
Until the Premises Permit mortgage registration is
finished and in bank custody
22546.73
Total 37135.79
(3) Other contingencies
For contingent liabilities related to joint venture or associate investment please refer to Note VII.2. (2)
As at 31 December 2020 there is no other contingency to be disclosed.
XII. Post balance sheet date events
1. Profit distribution after the balance sheet date
Based on the total share capital of 1011660000 shares as of 31 December 2020 a cash dividend of
RMB 0.87 (including tax) will be distributed to all shareholders for every 10 shares as total as RMB
88014420.00.
As of March 19 2021 the Group has no other balance sheet dates to disclose.
XIII.Other significant items
1. Government grants
(1) Government grants recognized in proft and loss and subsequently measured using the gross
method.Item Type
Recognised in
profit and loss for
the year ended
31/12/2019
Recognised in
profit and loss for
the year ended
31/12/2020
Presentation item
recognized in
profit and loss
Related to
asset/income
Stabilization
allowance
Government
funding
4414.90 125750.12 Other income income
Epidemic prevention
subsidies
Government
funding
-- 3245019.09 Other income income
2. Others
From 14 September 2016 the Group planned the reorganization of material assets. The Group
announced it intended to buy 100% stock equity of Evergrande real estate group co. LTD by issue
shares or cash payment on 14 October 2016. Guangzhou Chiron real estate co. LTD will become the
controlling shareholder of the company after the acquisition.On November 8 2020 the Company held the 57th meeting of the 7th Board of Directors to consider
and pass the Bill on ending the Planning of Major Asset Reorganization Matters and other bills
agreeing to terminate this Material Asset Reorganization Matter.XIV.Notes to the Company’s financial statements
1．Accounts receivable
(1) Accounts receivable by aging
Aging As at 31/12/2020 As at 31/12/2019
Within 1 year 5281165.00 4766.37
1-2 years - 66518.00
2-3 years 66518.00 --
Aging As at 31/12/2020 As at 31/12/2019
More than 3 years 10221420.93 10715652.53
Sub-total 15569103.93 10786936.90
Less：Provision for bad and doubtful
debts
10151079.19 10630001.06
Total 5418024.74 156935.84
（2）Accounts receivable by category
Item
As at 31/12/2020
Book balance
Provision for bad and doubtful
debts Carrying
amount
Book value
Percentage of
provision %
Book value
Expected
credit loss(%)
Provision assessed for impairment
individually
10132205.24 65.08 10132205.24 100.00 -
Collectively assessed for
impairment based on credit risk
characteristics
5436898.69 34.92 18873.95 0.35 5418024.74
Including:
Accounts receivable from related
parties in consolidated scope
5059419.69 32.50 - 0.00 5059419.69
Accounts receivable from sales of
properties
- 0.00 - -
Receivables from other clients 377479.00 2.42 18873.95 5.00 358605.05
Total 15569103.93 100.00 10151079.19 65.20 5418024.74
Continued
Item
As at 31/12/2019
Book balance
Provision for bad and
doubtful debts Carrying
amount
Book value
Percentage of
provision %
Book value
Expected
credit loss(%)
Provision assessed for impairment
individually
10626436.84 98.51 10626436.84 100.00 --
Collectively assessed for impairment
based on credit risk characteristics
160500.06 1.49 3564.22 2.22 156935.84
Including:
Accounts receivable from related
parties in consolidated scope
89215.69 0.83 -- -- 89215.69
Accounts receivable from sales of
properties
71284.37 0.66 3564.22 5.00 67720.15
Total 10786936.90 100.00 10630001.06 98.55 156935.84
Provision assessed for impairment individually：
Category
2020.12.31 2019.12.31
Book value provision
Expected
credit
Book value provision
Expected
credit Reason
Loss rate
（%）
Loss rate
（%）
Long-term accounts
receivable from
sales of proproties
10132205.24 10132205.24 100.00 10523723.00 10523723.00 100.00
Not exp
ected to
be rec
overed
Collectively assessed for impairment based on credit risk characteristics:
Accounts receivable from related parties in consolidated scope
Age
2020.12.31 2019.12.31
Account
receivables
provision
Expected
credit
loss(%)
Account
receivables
provision
Expected
credit
loss(%)
Within 1 year 5059419.69 -- -- -- -- --
1 to 2 years -- -- -- -- -- --
2 to 3 years -- -- -- -- -- --
More than 3 years -- -- -- 89215.69 -- --
Total 5059419.69 -- -- 89215.69 -- --
Accounts receivable from sales of properties
Age
2020.12.31 2019.12.31
Account
receivables
provision
Expected
credit
loss(%)
Account
receivables
provision
Expected
credit
loss(%)
Within 1 year 310961.00 15548.05 5.00 4766.37 238.32 5.00
1-2 year -- -- -- 66518.00 3325.90 5.00
2-3 year 66518.00 3325.90 5.00 -- -- --
Total 377479.00 18873.95 5.00 71284.37 3564.22 5.00
（3）Additions recoveries or reversals of provision for bad and doubtful debts during the year:
Item Provision for bad and doubtful debts
As at 31/12/2019 10630001.06
Provision -478921.87
Recovery --
Written-off --
As at 31/12/2020 10151079.19
（4）Top 5 entities with the largest balances of other receivables
Name of Entity Amount
Proportion of
the amount to
the total AR (%)
Bad debt provision
Shenzhen Haiyan Hotel Co. Ltd 5059419.69 32.50 --
Daxing Auto Parts Co. Ltd 1912353.37 12.28 1912353.37
Wang Weidong 1200000.00 7.71 1200000.00
Shenzhen Xinfeng Real Estate Consultants Co. Ltd 1144740.49 7.35 1144740.49
Cai Guangyao 876864.11 5.63 876864.11
Total 10193377.66 65.47 5133957.97
2.Other receivables
① Other receivable by aging
Aging As at 31/12/2020 As at 31/12/2019
Within 1 year 342045464.68 91158862.87
1-2 years 79875511.65 140372735.75
2-3 years 140372735.75 73930238.58
More than 3 years 1399130297.43 1330808992.53
Sub-total 1961424009.51 1636270829.73
Less：Provision for bad and doubtful debts 801009814.12 800995331.04
Total 1160414195.39 835275498.69
② Other receivables by category
Item
As at 31/12/2020 As at 31/12/2019
Book
balance
Provision for bad
and doubtful debts
Carrying amount
Book
balance
Provision for
bad and
doubtful debts
Carrying
amount
Amount receivables
from government
165460.00 -- 165460.00 721755.80 -- 721755.80
Amount receivable
from petty cash
-- -- -- 182691.21 -- 182691.21
Amount receivables
of the collecting and
paying on another's
behalf
307.17 -- 307.17 3248.36 -- 3248.36
Amount receivables
of current accounts
5464176.55 3647753.92 1816422.63 6818306.11 5744165.49 1074140.62
Amount receivables
of related parties
137211313.52 137211313.52 -- 135567522.22 135100418.87 467103.35
Amount receivables
in consolidated scope
1818582752.27 660150746.68 1158432005.59 1492977306.03 660150746.68 832826559.35
Total 1961424009.51 801009814.12 1160414195.39 1636270829.73 800995331.04 835275498.69
③Provision for bad and doubtful debts：
As at 31/12/2020 there are the provisions for bad debts in the first stage :
Category
Book
balance
To 12-month
expected credit
loss (%)
Provision for
bad and
doubtful debts
Carrying
amount
Reasons
Collectively assessed for impairment based
on credit risk characteristics
Amount receivables from government 165460.00 -- -- 165460.00
Amount receivables from petty cash -- -- -- --
Amount receivables from the collecting and
paying on another's behalf
307.17 -- -- 307.17
Amount receivables from current accounts 1912023.82 5.00 95601.19 1816422.63
Amount receivables from related parties -- -- -- --
Total 2077790.99 4.60 95601.19 1982189.80
As at 31/12/2020 there is the provision for bad debts in the second stage :
Category
Book
balance
To 12-month
expected
credit loss (%)
Provision for
bad and
doubtful debts
Carrying
amount
Reasons
Provision assessed for
impairment individually
Other receivables from related
parties in consolidation scope
1818582752.27 36.30 660150746.68 1158432005.59
Expected to be
not recoverable
As at 31/12/2020 there are the provisions for bad debts in the third stage :
Category
Book
balance
12-month expected
credit loss(%)
Provision for
bad and
doubtful debts
Carrying
amount
Reasons
Provision assessed for impairment
individually
Amount receivables of current
accounts
3552152.73 100.00 3552152.73 --
Expected to be not
recoverable
Amount receivables of related
parties
137211313.52 100.00 137211313.52 --
Expected to be not
recoverable
Total 140763466.25 100.00 140763466.25 --
④Additions recoveries or reversals of provision for bad and doubtful debts during the year
Provision for bad and doubtful
The first stage The second stage The third stage
Total 12-month
expected credit
loss
Lifetime expected
credit loss (no
credit impairment)
Lifetime expected
credit loss (has
occurred credit
impairmen)
As at 31/12/2019 81118.11 660150746.68 140763466.25 800995331.04
Provision 14483.08 -- -- 14483.08
Recovery -- -- -- --
Written-off -- -- -- --
As at 31/12/2020 95601.19 660150746.68 140763466.25 801009814.12
⑤ There were no other receivables written off in the current period.⑥Top 5 entities with the largest balances of other receivables
Name of Entity
Relations
hip with
the group
Amount Aging
Proportion
of the
amount to
the total
OR (%)
Bad debt
provision
Shantou Huafeng Estate
Development Co. Ltd
Subsidiary 777718384.72
Within 1 year、1-3years、More than
3 years
39.65 --
Fresh Peak Enterprise Co. Ltd Subsidiary 534325628.01
Within 1 year、More than 5 years
27.24 508377320.74
Shenzhen ShenFang Group
Longgang Development Co. Ltd
Subsidiary 234000000.00 Within 1 year 11.93 --
. American Great Wall Co. Ltd Subsidiary 103403196.15 More than 5 years 5.27 103403196.15
Canada Great Wall( Vancouver )
Co. Ltd
Subsidiary 89035748.07 More than 5 years 4.54 89035748.07
Total 1738482956.95 88.63 700816264.96
3、Long-term equity investments
Item
As at 31/12/2020 As at 31/12/2019
Book balance
Provision for
impairment
Book value Book balance
Provision for
impairment
Book value
Investment in
subsidiaries
303045949.42 152839271.15 150206678.27 303045949.42 152839271.15 150206678.27
Investment in joint
ventures
9455465.38 9455465.38 -- 9455465.38 9455465.38 --
Investment in
associates
2899869.88 2522380.20 377489.68 2992218.85 2522380.20 469838.65
Total 315401284.68 164817116.73 150584167.95 315493633.65 164817116.73 150676516.92
（1）Investment in subsidiaries
Name of investee
Opening
balance
Curr. year
Increase
Curr.
year
decrease
Closing
balance
Curr. year
impairment
provision
Closing
balance of
impairment
provision
Shenzhen City Property
Management Ltd.
12821791.52 12821791.52 --
Shenzhen Petrel Hotel Co.Ltd.
20605047.50 20605047.50 --
Shenzhen City Shenfang
Investment Ltd.
9000000.00 9000000.00 --
Fresh Peak Enterprise Ltd. 556500.00 556500.00 --
Fresh Peak Zhiye Co. Ltd. 22717697.73 22717697.73 --
Shenzhen Special Economic
Zone Real Estate (Group)
Guangzhou Property and
Estate Co. Ltd.
19000000.00 19000000.00 19000000.00
Shenzhen Zhen Tong
Engineering Ltd
11332321.45 11332321.45 --
Name of investee
Opening
balance
Curr. year
Increase
Curr.
year
decrease
Closing
balance
Curr. year
impairment
provision
Closing
balance of
impairment
provision
American Great Wall Co. Ltd 1435802.00 1435802.00 --
Shenzhen City Shenfang
Free Trade Trading Ltd.
4750000.00 4750000.00 --
Shenzhen City Hua Zhan
Construction Management
Ltd.
6000000.00 6000000.00 --
QiLu Co.Ltd 212280.00 212280.00 --
Beijing Shenfang Property
Management Co. Ltd.
500000.00 500000.00 500000.00
Shenzhen Lain Hua Industry
and Trading Co. Ltd.
13458217.05 13458217.05 --
Shenzhen City SPG Long
Gang Development Ltd.
30850000.00 30850000.00 --
Beijing Fresh Peak Property
Development Management
Limited Company
64183888.90 64183888.90 64183888.90
Shantou City Huafeng Real
Estate Devepment Co. Ltd
16467021.02 16467021.02 --
Paklid Limited 201100.00 201100.00 201100.00
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
Total 303045949.42 303045949.42 152839271.15
Note：Shenzhen Special Economic Zone Real Estate (Group) Guangzhou Property and Estate Co. Ltd.the registered capital of RMB 20 million yuan the company subscribed for RMB 19 million(95% of total
shares) another subsidiary Shenzhen City Shenfang Investment Ltd. subscribed RMB 1.0 million(5% of
total shares).（2）Investment in associates and joint ventures
Name of investee
Opening
balance
Changes in this period
Closing
balance
The ending
balance of
impairment
Additional
investment
Reduce
investment
Investment
gains and
losses
confirmed by
the equity
method
Adjustment of
other
comprehensive
income
Changes
in other
equity
Cash
dividend or
profit
declared
Impairment Others
① Joint ventures
Fengkai Xinghua Hotel 9455465.38 -- -- -- -- -- -- -- -- 9455465.38 9455465.38
Subtotal 9455465.38 -- -- -- -- -- -- -- -- 9455465.38 9455465.38
②Associates
Shenzhen Ronghua Jidian
Co. Ltd
1546793.29 -- -- -92348.97 -- -- -- -- -- 1454444.32 1076954.64
Shenzhen Runhua
Automobile Trading Co. Ltd
1445425.56 -- -- -- -- -- -- -- -- 1445425.56 1445425.56
Subtotal 2992218.85 -- -- -92348.97 -- -- -- -- -- 2899869.88 2522380.20
Total 12447684.23 -- -- -92348.97 -- -- -- -- -- 12355335.26 11977845.58
4、Operating income and costs
Item
2020 2019
Revenue Cost Revenue Cost
Principal operating 911815174.45 241307783.52 1666904055.40 330874297.00
Other operating 24095.25 -- 48857.18 --
（1）Principal operating activities (classified by industries)
Name of industry
2020 2019
Operating income Operating cost Operating income Operating cost
Real estate 860010047.62 211257440.88 1599279513.73 304208253.29
Lease 51805126.83 30050342.64 67624541.67 26666043.71
Total 911815174.45 241307783.52 1666904055.40 330874297.00
（2）Principal operating activities (classified by geographical areas)
Name of
geographical area
2020 2019
Operating income Operating cost Operating income Operating cost
Guangdong province 911815174.45 241307783.52 1666904055.40 330874297.00
5、Investment income
Item 2020 2019
Investment income from long-term investments under cost method -- 518700131.64
Investment income from long-term investments under equity method -92348.97 75629.25
Investment income from available-for-sale financial assets during the holding
period
-- --
Investment income from other equity instrument 599760.00 928200.00
Investment income from structured deposit 15217058.60 31425651.98
Total 15724469.63 551129612.87
XV. Supplementary information
1．Details of non-recurring gains or losses
Item 2020 Note
Profit or loss on disposal of non-current assets 11429.23
Government grants recognized in profit or loss (other than grants which
are closely related to the Company’s business and are either in fixed
amounts or determined under quantitative methods in accordance with
the national standard)
3370769.21
Profit or loss on entrusted investments or assets management 15217058.60
Income from expired
structured deposit
Interest on unexpired structured deposit --
Non-operating income/(expenses) except the above 29009657.60
Other non-recurring gains or losses 1237002.86
Item 2020 Note
Profit or loss on disposal of non-current assets 11429.23
Total non-recurring gains or losses 48845917.50
Less: Effects of income tax on non-recurring gains or losses 12211479.38
Net non-recurring gains or losses 36634438.12
Less: Effects of non-recurring gains or losses attributable to the minority
shareholders of the Company (after tax)
--
Non-recurring gains or losses attributable to the shareholders of the
Company
36634438.12
2、Return on net assets and earnings per share
Profit of reporting period
Weighted average
return on net
assets%
Earnings per share
Basic earnings Diluted earnings
Net profit attributable to the Company’s ordinary
equity shareholders
7.81% 0.2869 0.2869
Net profit attributable to the Company’s ordinary
equity shareholders after deduction of
non-recurring profit or loss
6.82% 0.2507 0.2507
Part XIII Documents Available for Reference
1. The financial statements signed and sealed by the legal representative the head of financial affairs and
the head of the financial department; and
2. The original copy of the Independent Auditor’s Report signed and sealed by the CPAs as well as sealed
by the CPA firm; and
3. The originals of all the Company’s documents and announcements which were disclosed on Securities
Time China Securities Journal and Ta Kung Pao (HK) during the Reporting Period.
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