Guangdong Provincial Expressway Development Co. Ltd.2020 Annual Report March 2021 I. Important Notice Table of Contents and Definitions The Board of Directors and the directors Supervisory Committee and supervisors and Senior Executives of the Company hereby warrant that at the year there are no misstatement misleading representation or important omissions in this report and shall assume joint and several liability for the authenticity accuracy and completeness of the contents hereof.Mr.Zheng Renfa The Company leader Mr. Wang Chunhua General Manager Mr. Lu Ming Chief financial officer and the Ms.Zhou Fang the person in charge of the accounting department (the person in charge of the accounting )hereby confirm the authenticity and completeness of the financial report enclosed in this annual report. All the directors attended the board meeting for reviewing the Annual Report. The toll revenues of Expressway is main source of the major business income of the company The charge standard of vehicle toll must be submitted to the same level people's government for review and approval after the transport regulatory department of province autonomous region or municipality directly under the central government in conjunction with the price regulatory department at the same level consented upon examination.Therefore the adjustment trend of the charge price and the charge price if has the corresponding adjustment in the future price level when the cost of the company rises still depend on the approval of relevant national policies and government departments and the company isn't able to make timely adjustment to the charge standard in accordance with the its own operation cost or the change of market supply demand. So the change of charge policy and the adjustment of charge standard also have influence on the expressways operated by the company to some extent. So the charging policy changes and charges adjustment will affect the highways operation of the company.The profit distribution proposal reviewed and approved by the boarding meeting was summarized as follows: 2090806126 for the base the Company would distribute cash dividend to all the shareholders at the rate of CNY 2.91 for every 10 shares (with tax inclusive) 0 bonus shares（including tax）and no reserve would be converted into share capital. Table of Contents I.Important Notice Table of contents and Definitions II. Basic Information of the Company and Financial index III. Outline of Company Business IV. Management’s Discussion and Analysis V. Important Events VI. Change of share capital and shareholding of Principal Shareholders VII. Situation of the Preferred Shares VIII. Information about convertible corporate bonds IX. Information about Directors Supervisors and Senior Executives X. Administrative structure XI. Corporate Bond XII. Financial Report XIII. Documents available for inspection Definition Terms to be defined Refers to Definition Reporting period This year Refers to January 1 2020 to December 31 2020 Reporting date Refers to The annual report of the company was approved by the board of directors on 2020 that is March 25 2021 YOY Refers to Compared with 2019 The Company /This Company Refers to Guangdong Provincial Expressway Development Co.Ltd. Communication Group Refers to Guangdong Communication Group Co. Ltd. Provincial Expressway Refers to Guangdong Provincial Freeway Co.Ltd. Construction Company Refers to Guangdong Highway Construction Co. Ltd. Technology Company/Guangdong Expressway Technology Refers to Guangdong Expressway Technology Investment Co. Ltd Fokai Company Refers to Guangdong Fokai Expressway Co. Ltd. Reconstruction and extension Project of the South Section of Fokai Expressway Refers to Reconstruction and Expansion Project of Sanbao-Shuikou Section of Fokai Expressway. Guangfo Company Refers to Guangdong Guangfo Expressway Co. Ltd.Guangzhu Transportation1 Refers to Guangzhou Guangzhu Transportation Investment Management Co.Ltd.Guangdong Expressway Capital Refers to Yuegao Capital Investment (Hengqin) Co. Ltd.Guangzhu East Company Refers to Jingzhu Expressway Guangzhu Section Co. Ltd.Guanghui Company Refers to Guangdong Guanghui Expressway Co. Ltd.Major assets restructuring Refers to Guangdong Provincial Expressway Development Co. Ltd. acquired 21% equity of Guangdong Guanghui Expressway Co. Ltd. held by Guangdong Provincial Expressway Co. Ltd. by paying cash in 2020 II. Basic Information of the Company and Financial index 1．Company Information Stock abbreviation: Guangdong Expressway AB Stock code： 000429200429 Stock exchange for listing Shenzhen Stock Exchange Name in Chinese 广东省高速公路发展股份有限公司 Chinese Abbreviation 粤高速 English name (If any) Guangdong Provincial Expressway Development Co.Ltd. English Abbreviation (If any) GPED Legal Representative Zheng Renfa Registered address 85 Baiyun Road Guangzhou Guangdong Province Postal code of the Registered Address 510100 Office Address 45-46/F Litong Plaza No.32 Zhujiang East Road Zhujiang New City Tianhe Disrtict Guangzhou Postal code of the office address 510623 Internet Web Site www.gpedcl.com E-mail ygs@gdcg.cn 2. Contact person and contact manner Board secretary Securities affairs Representative Name Yang Hanming Liang Jirong Contact address 46/F Litong Plaza No.32 Zhujiang East Road Zhujiang New City Tianhe District Guangzhou 45/F Litong Plaza No.32 Zhujiang East Road Zhujiang New City Tianhe District Guangzhou Tel 020-29004619 020-29004523 Fax 020-38787002 020-38787002 E-mail Hmy69@126.com 139221590@qq.com 3. Information disclosure and placed Newspapers selected by the Company for information disclosure Securities Times China Securities Shanghai Securities Daily and Hongkong Commercial Daily.Internet website designated by CSRC for publishing the Annual report of the Company www.cninfo.com.cn The place where the Annual report is prepared and placed Securities affair Dept of the Company 4.Changes in Registration Organization Code 91440000190352102M Changes in principal business activities since listing (if any) No change Changes is the controlling shareholder in the past (is any) On November 2000 In accordance with Cai Guan Zi (2008) No. 109 Document of Ministry of Finance and Yue Ban Han (2000) No. 574 Document of General Office of Guangdong People's Government the state-owned shares of Guangdong Expressway originally entrusted to Guangdong Expressway Company (now renamed as "Guangdong Provincial Expressway Co. Ltd.") for management were transferred to Guangdong Communication Group Co. Ltd. for holding and management. After the transfer of state-owned shares Guangdong Communication Group Co. Ltd. became the largest shareholder of the Company. The nature of equity was defined as state-owned shares. 5. Other Relevant Information CPAs engaged Name of the CPAs Yong Tuo Cerified Public Accountants(Special General Partnership) Office address： 13/F 2 Building No.1 North Street Guandongdian Chaoyang District Beijing Names of the Certified Public Accountants as the signatories Shi Shaoyu Li Junjie The sponsor performing persistent supervision duties engaged by the Company in the reporting period. □ Applicable√ Not applicable The Financial advisor performing persistent supervision duties engaged by the Company in the reporting period √Applicable □ Not applicable Name Office address Name of sponsor Consitent supervision period China International Capital Corporation Limited 27-28/F 2 Black，No1. Guomao Building Jianguomen Wai Street Chaoyang District Beijing Xie Yi Long Hai 2020-2021 2020 Annual Report 6.Summary of Accounting data and Financial index Whether it has retroactive adjustment or re-statement on previous accounting data √Yes □ No Retroactive adjustment or restatement of causes: Merger of enterprises under the same control 2020 2019 Changes of this period over same period of Last year(%) 2018 Before adjustment After adjustment After adjustment Before adjustment After adjustment Operating income（RMB） 3790348876.26 3057935584.43 4999016766.74 -24.18% 3218694083.94 5074352303.23 Net profit attributable to the shareholders of the listed company（RMB） 867842774.78 1258628101.71 1469187067.83 -40.93% 1677028179.18 1880524910.95 Net profit after deducting of non-recurring gain/loss attributable to the shareholders of listed company（RMB） 704821643.20 1249576930.75 1249579043.32 -43.60% 1395441391.82 1395441391.82 Cash flow generated by business operation net（RMB） 2636187241.05 1988551897.83 3222681187.05 -18.20% 1915985578.04 3300975145.20 Basic earning per share(RMB/Share) 0.42 0.60 0.70 -40.00% 0.80 0.90 Diluted gains per share(RMB/Share) 0.42 0.60 0.70 -40.00% 0.80 0.90 Weighted average ROE(%) 8.27% 13.09% 14.18% -5.91% 18.37% 19.10% End of 2020 End of 2019 Changed over last year End of 2018 Before adjustment After adjustment After adjustment Before adjustment After adjustment Gross assets（RMB） 19748578658.11 17674545340.78 20666939285.90 -4.44% 16295910774.45 19998135903.61 Net assets attributable to shareholders of the listed company（RMB） 7933136499.11 9823426849.75 10557360463.78 -24.86% 9586701904.06 10281913855.74 2020 Annual Report The lower of the company’s net profit before and after the deduction of non-recurring gains and losses in the last three fiscal years is negative and the auditor's report of the previous year shows that the Company’s going concern ability is uncertain.□ Yes √No The lower of the net profit before and after the deduction of the non-recurring gains and losses is negative.□ Yes √No 7.The differences between domestic and international accounting standards 1．Simultaneously pursuant to both Chinese accounting standards and international accounting standards disclosed in the financial reports of differences in net income and net assets. □ Applicable□√ Not applicable None 2. Differences of net profit and net assets disclosed in financial reports prepared under overseas and Chinese accounting standards. □Applicable √Not applicable None 8.Main Financial Index by Quarters In RMB First quarter Second quarter Third quarter Fourth quarter Operating income 354885621.22 763073802.24 1361154456.80 1311234996.00 Net profit attributable to the shareholders of the listed company -65790927.23 90407352.98 416728710.01 426497639.02 Net profit after deducting of non-recurring gain/loss attributable to the shareholders of listed company -71989487.82 62474770.40 348606597.62 365729763.00 Net Cash flow generated by business operation 163886674.37 545776621.44 1035210364.11 891313581.13 Whether significant variances exist between the above financial index or the index with its sum and the financial index of the quarterly report as well as semi-annual report index disclosed by the Company.√Yes □ No In 2020 the Company implemented a major asset restructuring through purchasing 21% equity of Guanghui Expressway by cash shares which was completed on December 25 2020 realizing the merger under the same control and adjusting the quarterly and semi-annual financial report data accordingly. 2020 Annual Report 9.Items and amount of non-current gains and losses √Applicable □Not applicable In RMBItems Amount (2020) Amount (2019） Amount (2018) Notes Gains/Losses on the disposal of non-current assets -8261533.18 7607268.21 63173138.25 Government grants recognized in the current period except for those acquired in the ordinary course of business or granted at certain quotas or amounts according to the country’s unified standards 8359291.82 87937.00 1113228.32 Current net gains and losses occurred from period-begin to combination day by subsidiaries resulting from business combination under common control 546213524.55 701856178.51 678322439.24 The Company originally held 30% equity of Guanghui Expressway In 2020 the Company purchased 21% equity of Guanghui Expressway in cash and the merger date under the same control was December 312020 which was 70% of the net profit and loss realized by Guanghui Expressway in 2020 from the beginning of merger to the date of merger. Net amount of non-operating income and expense except the aforesaid items -1069827.30 -1393149.65 -1545368.05 Other non-recurring Gains/loss items 974321.89 1652603.05 Less :Influenced amount of income tax 2214.32 1130270.54 -230679518.30 Influenced amount of minor shareholders’ equity (after tax) 383192431.88 489072542.07 486659436.93 In 2020 the Company purchased 21% equity of Guanghui Expressway in cash and the merger date under the same control was December 31 increasing the net profit and loss realized by Guanghui Expressway in 2020 which was attributable to minority shareholders by RMB 382722793.66. Total 163021131.58 219608024.51 485083519.13 -- 2020 Annual Report For the Company’ s non-recurring gain/loss items as defined in the Explanatory Announcement No.1 on information disclosure for Companies Offering their Securities to the Public-Non-recurring Gains and Losses and its non-recurring gain/loss items as illustrated in the Explanatory Announcement No.1 on information Disclosure for Companies offering their securities to the public-non-recurring Gains and losses which have been defined as recurring gains and losses it is necessary to explain the reason. □ Applicable√ Not applicable None of Non-recurring gain /loss items recorgnized as recurring gain /loss/items as defined by the information disclosure explanatory Announcement No.1- Non – recurring gain/loss in the report period. III. Business Profile Ⅰ.Main Business the Company is Engaged in During the Report Period The Company is an infrastructure industry with main business in developing and operating expressway and big bridges. It is one of the main institutions of developing expressway and big bridge in Guangdong Expressway System. The expressway industry is the industry helped by government.The Company is mainly engaged in tolling and maintenance of Guangfo Expressway Fokai Expressway and Jingzhu Expressway Guangzhu Section investment in technological industries and provision of relevant consultation while investing in Shenzhen Huiyan Expressway Co. Ltd. Guangzhou Guanghui Expressway Co.Ltd.Guangdong Jiangzhong Expressway Co. Ltd. Zhaoqing Yuezhao Expressway Co. Ltd.Ganzhou Kangda Ex pressway Ganzhou Gankang Expressway Co. Ltd.Guangdong Yueke Technology Petty Loan Co. Ltd. Guangdong Guangle Expressway Co.Ltd. Guoyuan Securities Co. Ltd.and Hunan Lianzhi Technology Co. Ltd. As of the end of the reporting period the company’s share-controlled expressway is 306.78 km and the share-participation expressway is 295.88 km.Ⅱ.Major Changes in Main Assets 1. Major Changes in Main Assets Main assets Major changes Equity assets Compared with the beginning of the year it increased by RMB 175.11 million and 7.93% which was mainly due to the increase of long-term equity investment by RMB 130 million yuan for the subscription of Guoyuan Securities and increase of long-term equity investment by RMB 80 million for the investment in Hunan Lianzhi; and due to the capital reduction of Ganzhou Gankang Expressway Co. Ltd. to reduce the long-term equity investment by RMB 45 million. Fixed assets Compared with the beginning of the year it decreased by RMB 920.11 million and 7.38% which was mainly due to the comprehensive impact of depreciation of expressway sections and cancellation of temporary estimation and conversion to fixed assets of expressway toll station projects at provincial boundaries.Intangible assets Compared with the beginning of the year it increased by RMB 293.62 million and 3351.04% mainly because according to the relevant government documents the holding expressway company included the relevant operating expenses incurred during the epidemic prevention and control period from February 17 2020 to May 5 2020 into the book value of the intangible asset-toll road franchise Construction in process Compared with the beginning of the year it increased by RMB 99.34 million and 41.17% which was mainly due to the comprehensive impact of the increased pavement treatment works and bridge deck treatment works of Dayong Viaduct by Guangzhu East Company and the increased Gualvhu Interchange Project and cancellation of temporary estimation and conversion to fixed assets of expressway toll station project by Guanghui Company.Other current assets Compared with the beginning of the year it decreased by RMB 196.55 million and 99.99% It was mainly because that Guanghui Expressway recovered all external loans at the end of the year. 2. Main Conditions of Overseas Assets □ Applicable √Not applicable III. Analysis On core Competitiveness The toll revenue of expressway industry mainly depends on the regional economic development. The regional economy is the critical factor that influences the traffic volume. The Guangfo expressway and the Fokaiexpressway controlled by the company are part of the National Expressway Network Planning-“Five vertical andseven horizontal ” The share-controlled Jingzhu Expressway Guangzhu Section is a fast and convenient expressway. And many of the company’s equity-participation expressways that are part of the main skeleton of the Guangdong Provincial Expressway Planning-“Ten vertical and five horizontal” which provides a strong guarantee for stable traffic volume. Meanwhile the regional economy is the critical factor that influences the traffic volume as Guangdong province is the economically developed region with years’ continuous high growth of GDP so that provides the stable rising demand for the company. IV. Management’s Discussion andAnalysis I. General In 2020 the Company actively fulfilled its social responsibilities strove to overcome the adverse effects of the epidemic worked hard and overcame difficulties. While strictly implementing various epidemic prevention and control measures to achieve zero infection in the company's system it also adhered to the front line of epidemic prevention ensured smooth traffic made overall plans to promote the prevention and control of the normalized epidemic and all tasks and effectively promoted the stabilization and improvement of economic operation. 1. Major asset restructuring of the Company was completed on time. On July 16 2020 the Company started major asset restructuring and acquired 21% equity of Guanghui Company held by Provincial Expressway in cash to realize holding. Through the injection of high-quality road assets the mileage of expressway controlled by the Company has nearly doubled and the sustainable profitability of expressway the main business and the financing ability of the Company have been further improved. 2. The first intelligent transportation foreign investment project was implemented smoothly. In June 2020 the Company completed the project investment of RMB 80 million in Hunan Lianzhi Technology Co. Ltd. by increasing capital to Yuegao Capital and the members of Yuegao Capital Project Team implemented the follow-up investment simultaneously. This project is the Company's first overseas investment project in smart transportation and it is also the first project for the project team members to make follow-up investment which is a new breakthrough for the Company to explore and innovate the investment mechanism under the new situation. 3. The crucial task of canceling the provincial boundary station was successfully completed. After the toll collection was resumed on May 6 2020 the toll stations of the Company's holding sections are with smooth traffic the service points of Unitoll Expressway in Guangdong operated orderly the toll display and data transmission of toll lanes were correct the lane configuration was continuously optimized and the ETC system was generally stable. 4. The revitalization of land resources along the route was accelerated. The Company insisted on the comprehensive development of land resources along the line as the main direction. The land resources along the Fokai Expressway including Zhishan Chenshan Xinjitian and Yanshan service areas have made phased progress in their revitalization. 5. The additional investment of the original financial equity projects was completed in an orderly manner. In November 2020 the Company invested about RMB 130 million and subscribed for 23.88 million shares of Guoyuan Securities in full at RMB 5.44 per share which well safeguarded the rights and interests of the Company. 6. The preparation of strategic planning was started in time. In 2020 the Company started the preparation of the "14th Five-Year Plan" set up a leading group and a working group and combined with internal interviews and external research with consideration of the current and long-term situation and based on a comprehensive summary of the implementation of the "13th Five-Year Plan" prepared the "14th Five-Year" Strategy Plan (first draft) which will be further revised and improved. 7. Guangzhu Transportation Company was successfully consolidated by merge. The Company started to consolidate by merge Guangzhu Transportation in May 2020 and successively completed the preparatory work assets verification special audit agreement signing internal decision-making tax settlement and other work.Through the efforts of all parties the cancellation approval notice was obtained on December 18 and the task of reducing the hierarchy was successfully completed. 8. The application for re-approval of the operation period of the reconstruction and expansion project of the south section of Fokai Expressway was closely followed up. According to the requirements of the audit unit the Company has supplemented the relevant information for re-approval of the operation period for many times and made explanations striving to obtain the government's approval as soon as possible.II. Main business analysis 1. General Volume of vehicle trafficin 2020 （Tenthousands vehicles） Increase /Decrease(%) Toll income in 2020（Ten thousands） Increase /Decrease(% Guangfo Expressway 7269.75 -4.25% 32971.09 -30.05% Fokai Expressway 7718.23 0.65% 96148.43 -24.68% Jingzhu Expressway Guangzhu East Section 6189.52 -15.56% 78237.88 -34.11% Guanghui Expressway 7487.22 6.45% 159235.27 -16.97% Huiyan Expressway 4349.60 -3.57% 18593.50 -24.62% Guangzhao Expressway 2892.08 -17.52% 43561.59 -21.58% Jiangzhong Expressway 6095.58 -0.82% 33867.12 -25.79% Kangda Expressway 147.82 -54.41% 21190.46 -17.47% Gankang Expressway 440.48 -14.87% 12833.68 -30.40% Guangle Expressway 3467.39 14.00% 248409.48 -22.01% Note: The traffic volume in the above table includes the traffic volume during toll-free period due to the impact of the epidemic. In 2020 due to the impact of the epidemic and the first-level emergency response was activated nationwide. The toll-free period of the original statutory Spring Festival holiday (January 24-January 30 2020) was extended to February 8; Meanwhile according to the relevant policies of the Ministry of Transport with the approval of the State Council from 0:00 on February 17 2020 to 24:00 on May 5 2020 the tolls of toll roads nationwide will be exempted. This policy led to a significant year-on-year decline in the toll revenue of the Company's participating companies. Moreover: (1) Guangzhu section of Jingzhu Expressway: ① Affected by the closure of Humen Bridge for 9 days the toll income decreased; ② In September the one-way maintenance of the section from the Minzhong to Xinlong Interchange lasted for 21 days which led to a decrease in vehicle traffic and a decrease in toll revenue; ③ The impact of the opening of Nansha Bridge in 2019 and the goods restriction of Humen Bridge tended to be stable in the fourth quarter of 2020; Under the same road network conditions the fourth quarter achieved a year-on-year growth trend. (2) Gankang Expressway: ① The national highway G323 was cancelled and some national highways were repaired and restored which diverted some traffic; ② Some sections of national highways G236 and G319 were restricted and some vehicles were diverted to other expressways. (3) Kangda Expressway: ① Due to the cancellation of the provincial boundary system the calculated traffic volume is different from previous years in statistical caliber; ② After the recovery of charges the public's road trip increased compared with the past and the passenger car traffic increased year-on-year; Logistics vehicles such as transportation cold chain fresh food and express delivery vehicles have grown rapidly and the traffic volume of trucks has also increased. 2. Revenue and cost (1)Component of Business Income In RMB 2020 2019 Increase /decreaseAmount Proportion Amount Proportion Total operating revenue 3790348876.26 100% 4999016766.74 100% -24.18% Industry Highway transportations 3665926709.10 96.72% 4853094808.04 97.08% -24.46% Other 124422167.16 3.28% 145921958.70 2.92% -14.73% Product Highway transportations 3665926709.10 96.72% 4853094808.04 97.08% -24.46% Other 124422167.16 3.28% 145921958.70 2.92% -14.73% Area Guangfo Expressway 329710947.81 8.70% 471345653.88 9.43% -30.05% Fokai Expressway 961484310.59 25.37% 1276614430.61 25.54% -24.68% Jingzhu Expressway Guangzhu Section 782378756.64 20.64% 1187425165.18 23.75% -34.11% Guanghui Expressway 1592352694.06 42.01% 1917709558.37 38.36% -16.97% Other 124422167.16 3.28% 145921958.70 2.92% -14.73% (2)Situation of Industry Product and District Occupying the Company’s Business Income and Operating Profit with Profit over 10% √ Applicable □Not applicable In RMB Turnover Operation cost Gross profit rate(%) Increase/decre ase of revenue in the same period of the previous year(%) Increase/decrease of business cost over the same period of previous year (%) Increase/decrease of gross profit rate over the same period of the previous year (%) Industry Highway 3665926709.10 1585926446.48 56.74% -24.46% -13.08% -5.66% transportations Product Highway transportations 3665926709.10 1585926446.48 56.74% -24.46% -13.08% -5.66% Area Guangfo Expressway 329710947.81 112789778.87 65.79% -30.05% -0.89% -10.07% Fokai Expressway 961484310.59 650430454.36 32.35% -24.68% -16.53% -6.61% Jingzhu Expressway Guangzhu Section 782378756.64 279884229.56 64.23% -34.11% -23.46% -4.98% Guanghui Expressway 1592352694.06 542821983.69 65.91% -16.97% -4.08% -4.58% Under circumstances of adjustment in reporting period for statistic scope of main business data adjusted main business based on latest on year’s scope of period-end. □ Applicable √Not applicable (3)Whether the Company’s Physical Sales Income Exceeded Service Income □ Yes √ No (4)Degree of Performance of the Significant Sales Contract Signed up to this Report Period □Applicable √Not applicable (5)Component of business cost Industry category In RMB Industry category Items 2020 2019 Increase/ Decrease (%)Amount Proportion in the operating costs (%) Amount Proportion in the operating costs (%) Highway transportations Depreciation andAmortized 1020703974.74 61.41% 1188983865.18 61.78% -14.15% Highway transportations Out of pocket expenses 565222471.74 34.00% 635659655.25 33.03% -11.08% Other Other 76297249.65 4.59% 99834413.47 5.19% -23.58% Note (6)Whether Changes Occurred in Consolidation Scope in the Report Period √ Yes □ No Compared with 2019 the scope of consolidation in this year was reduced to Guangzhou Guangzhu Transportation Investment Management Co. Ltd. which was due to the internal consolidation by merger of the Company. Compared with 2019 Guangdong Guanghui Expressway Co. Ltd. was added to the scope of consolidation this year because the Company acquired its 21% equity and held 51% equity of Guanghui Expressway and Guanghui Expressway was changed from an affiliated company to a subsidiary. (7)Relevant Situation of Significant Changes or Adjustment of the Business Product or Service in the Company’s Report Period □ Applicable √Not applicable (8)Situation of Main Customers and Main Supplier □ Applicable √Not applicable 3.Expenses In RMB 2020 2019 Increase /Decrease Notes Administrative expenses 203945119.58 218914654.80 -6.84% Financial expenses 216182374.88 224177216.66 -3.57% R & D expenses 404303.70 100.00% In 2020 Yuegao Technology incurred the expenditure of "R&D of Automatic Card Checking Machine for Expressway Composite Pass Cards". 4. Research and Development √ Applicable □Not applicable Since January 1 2020 the 5.8GHz CPC card has been uniformly used in the toll collection media of MTC vehicles across the country and the national unified CPC card management platform has been enabled and all cards have been uniformly managed which requires the card checking and warehousing operation for each allocated card. According to the feedback from some road sections with large traffic volume in the process of card allocation the work of card reading and sorting is tedious and dull and manual operation is prone to errors.Therefore it is expected that such manual operation can be replaced by automatic card reading and sorting machines. The Company actively seeks automation equipment manufacturers to jointly develop automatic checking machine products for composite pass cards. This project is mainly to develop an automatic card checking equipment which enables ticket managers in toll stations and CPC card dispatching center to complete automatic card checking arrange whole cards in an orderly manner and sort out defective cards only by putting the scattered cards into the card bin without manual card swiping and testing. The location of each card is recorded which is convenient for locating the cards and reduces the unnecessary card locating work caused by the sealing failure due to the register of a defective card in a different place. And each detected card can be automatically disinfected thus ensuring the health of people contacting the card.R & D investment 2020 2019 Increase /decrease Number of Research and Development persons (persons) 2 0 100.00% Proportion of Research and Development persons 0.07% 0.00% 0.07% Amount of Research and Development Investment (In RMB) 404303.70 0.00 100.00% Proportion of Research and Development Investment of Operation Revenue 0.01% 0.00% 0.01% Amount of Research and Development Investment Capitalization (In RMB) 0.00 0.00 0.00% Proportion of Capitalization Research and Development Investment of Research and Development Investment 0.00% 0.00% 0.00% The Reason of the Prominent Change in Total Amount of Research and Development Input Occupying the Business Income Year on Year √ Applicable □ Not applicable In 2020 Yuegao Technology incurred an expenditure of RMB 404303.7 on "R&D of Automatic Card Checking Machine for Expressway Composite Pass Cards" which is not incurred in 2019. Reasons for the drastic change of capitalization rate of R&D investment and its rationality explanation □ Applicable √Not applicable 5.Cash Flow In RMB Items 2020 2019 Increase/Decrease(%) Subtotal of cash inflow received from operation activities 4051493610.08 5167390664.45 -21.59% Subtotal of cash outflow received from operation activities 1415306369.03 1944709477.40 -27.22% Net cash flow arising from operating activities 2636187241.05 3222681187.05 -18.20% Subtotal of cash inflow received from investing activities 372548657.83 369542087.83 0.81% Subtotal of cash outflow for investment activities 884922836.28 1164320280.23 -24.00% Net cash flow arising from investment activities -512374178.45 -794778192.40 -35.53% Subtotal cash inflow received from financing activities 2258963500.00 3662685000.00 -38.32% Subtotal cash outflow for financing activities 4591305613.77 5780920106.63 -20.58% Net cash flow arising from financing activities -2332342113.77 -2118235106.63 10.11% Net increase in cash and cash equivalents -206800360.26 308133367.29 -167.11% Notes to the year-on-year change of the relevant data √Applicable □ Not applicable The cash inflow of fund-raising activities is RMB 2.259 billion which is the subsidy fund for obtaining loans and the Gualvhu Interchange Project received by Guanghui Company; Compared with the same period of last year it decreased by RMB 1.404 billion mainly due to the decrease in loans. Reasons of major difference between the cash flow of operation activity in report period and net profit of the Company √Applicable □ Not applicable In RMB Year 2020 Adjusting net profit to cash flow from operating activities Net profit 1364385006.07 Credit loss provision 2457808.51 Impairment loss provision of assets 1231918.94 Depreciation of fixed assets oil and gas assets and consumable biological assets 1009578943.06 Amortization of intangible assets 26319338.62 Amortization of Long-term deferred expenses 457642.44 Fixed assets scrap loss 13637658.30 Financial cost 265092013.47 Loss on investment -171366835.55 Decrease of deferred income tax assets 54738687.74 Increased of deferred income tax liabilities -41819079.34 Decrease of inventories 57922.16 Decease of operating receivables 136745935.47 Increased of operating Payable -25329718.84 Net cash flows arising from operating activities 2636187241.05 III.Analysis of Non-core Business √ Applicable □Not applicable In RMB Amount Proportion in total profit Explanation of cause Sustainable (yes or no) Investment Income 171366835.55 9.23% It is due to the operation accumulation of participant companies Sustainable Asset impairment -1231918.94 -0.07% Guanghui Company accrued impairment reserve for fixed assets Not sustainable Non-operating income 11749841.36 0.63% Mainly insurance claims road property claims and compensation income for demolition Not sustainable Non-operating expenses 20642932.77 1.11% Mainly non-current asset disposal losses and road property repair expenses Not sustainable Credit impairment losses -2457808.51 -0.13% Impairment provision of accounts receivable and other receivables accrual Not sustainable IV.Condition of Asset and Liabilities 1.Condition of Asset Causing Significant Change Adjustments to the Financial Statements at the Beginning of the First Execution Year of any New Standards Governing Financial Instruments Revenue or Leases from year 2020 Applicable In RMB End of 2020 End of 2019 Proportion increase/decrease Notes to the significant changeAmount Proportion in the total assets(%) Amount Proportion in the total assets(%) Monetary fund 2847398003.89 14.42% 3054198364.15 14.78% -0.36% Accounts receivable 168907517.56 0.86% 179449777.42 0.87% -0.01% Inventories 53761.06 0.00% 111683.22 0.00% 0.00% Investment real estate 3110381.89 0.02% 3331500.37 0.02% 0.00% Long-term equity investment 2382381165.60 12.06% 2207266324.84 10.68% 1.38% Fixed assets 11540075929.69 58.43% 12460188469.66 60.29% -1.86% Construction in process 340611095.47 1.72% 241274698.97 1.17% 0.55% Shore-term loans 200192500.00 1.01% 0.00% 1.01% Long-term loans 4977438800.00 25.20% 4926015000.00 23.84% 1.36% 2020 Annual Report 2.Asset and Liabilities Measured by Fair Value √Applicable □ Not applicable In RMB Items Opening amount Gain/Loss on fair value change in the reporting period Cumulative fair value change recorded into equity Impairment provisions in the reporting period Purchased amount in the reporting period Sold amount in the reporting period Other changes Closing amount Financial assets 4.Other equity instrument investment 1835822604.77 421106349.76 1737015528.29 Subtotal of financial assets 1835822604.77 421106349.76 1737015528.29 Total of the above 1835822604.77 421106349.76 1737015528.29 Financial liabilities 0.00 0.00 Other None Did any significant change occur to the attribute of the Company’s main asset measurement during the reporting period? □ Yes √No 3. Assets right restriction till end of reporting period The balance of restricted bank deposits at the end of the period was RMB 1221200.00 which was the land reclamation fund deposited into the fund custody account for the reconstruction and expansion project of sanbao to shuikou section of Fokai Expressway.III. Investment situation 1. General √ Applicable □ Not applicable Investment Amount in 2020(Yuan) Investment Amount in 2019(Yuan) Change rate 2703460018.24 1140508126.36 137.04% 2020 Annual Report 2.Condition of Acquiring Significant Share Right Investment during the Report Period √Applicable □Not applicable In RMB Name of the Company Invested Main Business Investme nt Way Investment Amount Share Proportion % Capital Source Partner Investment Horizon Product Type Progress up to Balance Sheet Date Anticipated Income Gain or Less or the Current Investment Whether to Involve in Lawsuit Date of Disclosure Disclosure Index Guanghui Expressw ay Expressw ay Purchase 24935495 76.00 51.00% Self and loans Guangdong Provincial Freeway Co.Ltd. On the basis of the term of operation approved by the government Limited Company Completed 0.00 0.00 No November 24 2020 Announcement of Resolutions of the 13th (Provisional) Meeting of the Ninth Board of Directors Hunan Lianzhi Technolog y Co. Ltd. Identificat ion & testing Purchase 80000000. 00 11.45% Self None On the basis of the term of operation approved by the government Limited Company Completed 0.00 0.00 No June 24 2020 Announcement of Resolutions of the 7th (Provisional) Meeting of the Ninth Board of Directors Guoyuan Securities Co. Ltd. Securities Increase capital 12991044 2.24 2.37% Self None Until reduction is complete Markettable securities Completed 0.00 0.00 No September 302020 Announcement of Resolutions of the 10th (Provisional) Meeting of the Ninth Board of Directors Total -- -- 27034600 18.24 -- -- -- -- -- -- 0.00 0.00 -- -- -- 2020 Annual Report 3.Situation of the Significant Non-equity Investment Undergoing in the Report Period □ Applicable √ Not applicable 4.Investment of Financial Asset （1）Securities investment √ Applicable □ Not applicable In RMB Security category Security code Stock Abbreviati on: Initial investment cost Mode of accounting measurement Book value balance at the beginning of the reporting period Changes in fair value of the this period Cumulative fair value changes in equity Purchase amount in the this period Sale amount in the this period Gain/loss of the reporting period Book value balance at the end of the reporting period Accoun ting items Sourc es of funds Domesti c and foreign stocks 601818 Everbright Bank 517560876.80 FVM 1037474303.04 0.00 421106349.76 0.00 0.00 50344558.02 938667226.56 Other equity instrum ent investm ent Self Total 517560876.80 -- 1037474303.04 0.00 421106349.76 0.00 0.00 50344558.02 938667226.56 -- -- Disclosure Date of Announcement on Securities Investment Approved by the Board of Directors July 222009 Disclosure Date of Announcement on Securities Investment Approved by the Shareholders Meeting(If any) August 72009 （2）Investment in Derivatives □ Applicable √ Not applicable The Company had no investment in derivatives in the reporting period. 5.Application of the raised capital □ Applicable √ Not applicable The Company had no application of the raised capital in the reporting period.VI. Sales of major assets and equity 1. Sales of major assets □ Applicable √ Not applicable The Company had no sales of major assets in the reporting period. 2.Sales of major equity □ Applicable √ Not applicable 2020 Annual Report VII.Analysis of the Main Share Holding Companies and Share Participating Companies √ Applicable □ Not applicable Situation of Main Subsidiaries and the Joint-stock Company with over 10% net profit influencing to the Company In RMB Company Name Company type Leading products and services Registered capital Total assets Net assets Operating Income Operating profit Net Profit Guangfo Expressway Subsidiary Operating Guangfo Expressway Co.Ltd.(starts from Hengsha Guangzhou ends in Xiebian Foshan. Total length 15.7 kilometers RMB 200 million 531194012.93 460405493.14 333647719.92 202903321.04 155032248.63 Jingzhu Expressway Guangzhu Section Co.Ltd.Subsidiary The operation and management of Guangzhu Expressway and provision of supporting services including fueling salvage and supply of parts and components RMB 580 million 2390811046.60 951363541.68 812354042.82 413718175.77 301738807.80 Guangdong Guanghui Expressway Co. Ltd. Sharing company Investment in and construction of Guanghui Expressway Co. Ltd. and supporting facilities the toll collection and maintenance management of Guanghui Expressway The Guanghui Expressway's supporting gas station salvation vehicle maintenance vehicle transport catering warehousing investment and development RMB 2.352 million 4518271534.85 3971913931.56 1616980738.55 1046966245.16 780305035.07 Subsidiaries obtained or disposed in the reporting period √Applicable □ Not applicable Name Ways to acquire and dispose of subsidiaries during the reporting period Impact on overall production operation and performance Guangdong Guanghui Expressway Co.Ltd. Combination under the same control Increase of the net profit attributable to listed companies by RMB 163.86 million in 2020 Guangzhou Guangzhu Transportation Investment Management Co. Ltd. Absorption merges None Particulars about the Mutual holding companies 1. Guangfo Expressway Co. Ltd. (the Company holds 75% equity) builds and operates Guangfo Expressway and its operation and management includes road maintenance toll collection maintenance of traffic facilities such as signs and markings and vehicle rescue. The net profit of the current period decreased by RMB 95.73 million year on year or 38.18%. The main reason for the decrease was that the toll revenue decreased due to the toll-free policy of the epidemic situation. 2. Jingzhu Expressway Guangzhu Section Co. Ltd. (the company holds 75% equity) operates Guangzhou-Zhuhai Expressway and provides the supporting refueling rescue and spare parts supply services of expressway. The net profit of the current period decreased by RMB 211327000 year-on-year or 41.19%. The main reason for the decrease was that the toll revenue decreased due to the toll-free policy of the epidemic situation. 3. Guangdong Guanghui Expressway Co. Ltd. (the company holds 51% equity) invests in and builds Guanghui Expressway and supporting facilities; Toll collection and maintenance management of Guanghui Expressway; Investment and development of gas stations rescue automobile maintenance automobile transportation catering and warehousing for Guanghui Expressway. The net profit of the current period decreased by RMB 222346600 year-on-year or 22.18%. The main reason for the decrease was that the toll revenue decreased due to the toll-free policy of the epidemic situation.VIII. Special purpose vehicle controlled by the Company □ Applicable √ Not applicable IX. Prospect for future development of the Company 2021 is the first year of the 14th Five-Year Plan. The general requirements of the work in 2021 are as follows: adhere to the general tone of striving for stability consolidate and expand the main business of expressways focus on economic benefits take market-oriented reform as the driving force strengthen innovation drive promote the intelligent upgrade of transportation industry emphasize on improving capital operation capability resolutely guard against major risks of enterprises and achieve a good start in the 14th Five-Year Plan. 1. Persist in stabilizing the expressway industry and provide a solid foundation for high-quality development. Firstly appropriately increase the shareholding ratio of existing high-quality road property projects accelerate the integration of superior resources and strive to increase the number of expressway holding projects. Secondly promote the reconstruction and expansion of the bottleneck expressway and verify the operation period. Thirdly based on the main business application scenario and combined with the industrial chain ecosystem increase the popularization and application of new technologies promote the digitalization and intelligent upgrading of operation and management and gradually apply modern information technologies such as cloud computing big data and AI to all sections of management so as to realize the transformation of scientific and technological production capacity and empower the development of the main business. 2. Grasp the strategic layout and capital operation promote transformation and develop business development and innovation According to the company's "14th Five-Year Plan" development plan and the Group's work requirements the strategic plan should be launched as soon as possible so as to make a good start for the integration of smart transportation and other emerging industries. Firstly learn from and benchmark the practical experience of first-class management enterprises and actively explore cooperation models by using technical forces such as industry R&D centers and research institutes to lay a good scientific and technological foundation for the development of the industry; Secondly seize the opportunity of state-owned enterprise reform leverage the capital market promote mergers and acquisitions of strategic emerging industries related to smart transportation obtain high-end products in the industrial chain strive for the implementation of a project and realize the development of superior main business empowerment; Thirdly actively participate in the research on asset restructuring of the smart transportation technology sector explore the feasible mode of implementing the integration of emerging industry resources within the Group and accelerate the cultivation of new kinetic energy for the Company's development; 3.Continue to promote and support the development of land resources along the route intensify the revitalization and utilization of land parcels such as Xinjitian Chenshan Dayanshan and Hengsha and fully push forward the upgrading and reconstruction project of Zhishan Service Area to ensure the smooth implementation of the development construction and operation of the service area. 4. Deepen reform lay a solid foundation and accomplish key special tasks in a solid manner Promote the upgrading of operational management. According to the deployment requirements of the Provincial Department of Transportation and the Provincial Transportation Group to alleviate congestion and ensure smoothness implement the specific work of linkage and smooth work in small areas strengthen the monitoring of road network operation optimize relevant processes and strengthen early warning and dispatching mechanisms; Perform systematic transformation of Guangfo Expressway toll stations implement the expansion project of Guangfo Expressway Michong and Shayong toll stations and upgrade and transform peripheral urban roads to alleviate traffic congestion at the entrances and exits of the two toll stations; Constantly strengthen the inspection of overloading supervision at the expressway entrance service area supervision supervision for space under bridge and pavement enhance the ability of scientific and technological transformation and continuously promote the upgrading of service area and the promotion of brand image. 5. Strengthen the construction of modern enterprise system. Under the overall strategic framework of the Company improve the connection between internal business assessment and strategy formulate quantitative and qualitative indicators of business plan comprehensively cover all business activities of the Company and the platform and enhance comprehensive service capabilities. Steadily promote the market-oriented operation mechanism complete the tenure system and contractual management of managers explore and continuously optimize the talent introduction mechanism further strengthen the construction of talent echelon promote the extension of the reform pilot work results integrating "incentive restraint and fault tolerance" to the grassroots level strengthen the cooperation of production education and research and independent innovation capabilities and strive to break the human resources barriers that restrict the Company's development thus providing guarantee for the Company's development kinetic energy transformation and industrial upgrading. 2020 Annual Report X. List of the received researches visits and interviews 1.Particulars about researches visits and interviews received in this reporting period √ Applicable □Not applicable Reception time Place of reception Way of reception Types of visitors Visitors received Main contents discussed and information provided Basic index April 72020 Meeting Room of the Company By Phone Organization 1Feng Siqi Sheshang Securities.2.Xu Senzhou BOCOM SCHRODERS.3. Guo Shuaitong New China Fund.4.Guan Panlong Jiashi Fund.5.Guo Zhaoyang ICBCCS.6. Ren Yilin BROAD fund. 7.Peng Ke Efunds. 8. Mao Wei Yi Li Southern Asset Management 9. Hao Xudong Nuode Fund 10.Niu Yongtao Yimin Fund.11.Yao Shuang China Merchants fund. 12.Zhang Chicheng Baank of China investment Management. 13.Zhang Yixin Li Shoufeng Fuanda Fund 14.Zhang Ke Yinhua Fund. 15. Dongkaili Bosera Fund 16.Li Zhechao Dacheng Fund. 1. The main content of research:1. the daily operation; 2. the company's financial data analysis;3.development strategy; 4.analysis on the industry. 2.Primary data investigation: Public information company regularly reports （2020001） www.cninfo.com.cn April 72020 Meeting Room of the Company By Phone Organization 1.Huatai Securities Shen Xiaofeng Lin Xiaying 2.Zhejiang Shanyuan Investment Management Co. Ltd. Tang Cong Liu Mingxia 3.China Innovation Capital Carol Chen 4.Elevation Capital Ben Zhang 5.Prime Capital Lu Peijie 6.Yunying Asset Teresa Lei 7.BooCommLife Wang Yaoyong 8.Kaishi Fund Management Co. Ltd.Zhao Chenkai 9.Huabao Fund Management Co. Ltd. Lu Yi 10.Guosen Securities Wang Chengqi 11.China Merchants Life Insurance Wang Kangjian 12.CMB Wealth Management 1. The main content of research:1. the daily operation; 2. the company's financial data analysis;3.development strategy; 4.analysis on the industry. 2.Primary data investigation: Public information company regularly reports （2020002） www.cninfo.com.cn 2020 Annual Report Reception time Place of reception Way of reception Types of visitors Visitors received Main contents discussed and information provided Basic index Zhang Ying 13.Morgen Taowei 14.Invesco Great Wall Fund He Jinyang. 15.Biyun Asset Fan Jia 16.Jin Chong Investment Mario Fei April 292020 Meeting Room of the Company By Phone Organization 1.Guotai Junan Securities Institure Zheng Wu Huangpu Xiaohan Yue Xin 2.Danshuiquan( Beijing) Investment Management Co. Ltd. Qian Yueqiang 3.Southern Asset Management Co. Ltd. Yi Li 4.Shanghai Dazheng Investment Wang Zhitong 5.BOC International (China) Co. Ltd.Lu Shasha 6.Bosera Funds Liu Xiaolong 7. Shenzhen Ximengbei Asset Management Co. Ltd. Sun Yuanjia 8.UBS SDIC Tang Haibo 9.Invesco Great Wall Fund Management Co. Ltd. He Jinyang 10. BoComm Life Wang Yaoyong 11.Taiping Fund Management Co. ltd. Li Teng 12.Guotuo Anxin Futures Co. Ltd. Wang Jianing 13. Qianhai Taihang Asset Management(Shenzhen) Co.Ltd. Xu Longping 1. The main content of research:1. the daily operation; 2. the company's financial data analysis;3.development strategy; 4.analysis on the industry. 2.Primary data investigation: Public information company regularly reports www.cninfo.com.cn August 272020 Meeting Room of the Company By Phone Organization 1.Guotai Junan Securities Institure Zheng Wu Huangpu Xiaohan 2.Shanghai Dazheng Investment Co. Ltd.Wang Zhitong 3. Tibet Yuancheng Investment Management Co. Ltd. Zeng Shang 4.Shenzhen Ximengbei Asset Managemeent Co. Ltd. Zhang Gang 5.BOSCASSET Yan Feng 6.Shenzhen Qianhai Dingye Investment Development Co. Ltd. Chen Zhixiong 1. The main content of research:1. the daily operation; 2. the company's financial data analysis;3.development strategy; 4.analysis on the industry. 2.Primary data investigation: Public information company regularly reports www.cninfo.com.cn 2020 Annual Report Reception time Place of reception Way of reception Types of visitors Visitors received Main contents discussed and information provided Basic index October 292020 Meeting Room of the Company By Phone Organization 1.Huatai Securities Lin Xiaying 2.Guotai Junan Secuties Huangpu Xiaohan 3.Tianfeng Securities Zeng Fanzhe 4.Zheshang Securities Li Xiang 5. Northerst Securities Zhang Yunkai 6.Dacheng Fund Zheng Xin 7.Shenghai Trust Liu Bai 8.China Life AMPAsset Management Co. Ltd. Yan Kun 9.ChengzhouAsset Zhu Yeting 10.Morgan Vivian Tao 11.Green Corut Jia Fan 1. The main content of research:1. the daily operation; 2. the company's financial data analysis;3.development strategy; 4.analysis on the industry. 2.Primary data investigation: Public information company regularly reports www.cninfo.com.cn Reception times 5 Reception agency amount 62 Reception personal number 0 Others 0 Whether to disclose reveal or disclose non-public material information No V. Important Events I. Specification of profit distribution of common shares and capitalizing of common reserves Formulation implementation and adjustment of profit distribution policy of common shares especially cash dividend policy during the reporting period □Applicable√ Not applicable The profit distribution preplan or proposal and the Plan(preplan) or proposal of conversion of the capital reserve into share capital in the past three years(with the reporting period inclusive): (1) The Company's profit distribution plan for 2018 is as follows: 1.10% of the net profit of the company i.e. 230581431.32 yuan is to be allocated for statutory common reserve fund. 2.The profit for 2018 is to be distributed as follows:1175033042.81 yuan. is to be allocated as the fund for dividend distribution for 2018. with the total shares at the end of 2018 i.e. 2090806126 shares as the base cash dividend of 5.62 yuan (including tax) is to be distributed for every 10 shares .The remaining undistributed profits are to be carried forward to the next year. The foreign exchange translation of the cash dividends for shareholders holding B share and overseas corporate shares will be determined according to HKD:RMB bank’s Middle rate quoted by People’s Bank of China on the first working day after 2018 annual shareholders’ general meeting makes resolution on dividend distribution. (2) The Company's profit distribution plan for 2019 is as follows: 1.10% of the net profit of the company i.e. 135022507.55 yuan is to be allocated for statutory common reserve fund. 2.The profit for 2019 is to be distributed as follows: 882320185.17 yuan. is to be allocated as the fund for dividend distribution for 2019. with the total shares at the end of 2019 i.e. 2090806126 shares as the base cash dividend of 4.22 yuan (including tax) is to be distributed for every 10 shares .The remaining undistributed profits are to be carried forward to the next year. The foreign exchange translation of the cash dividends for shareholders holding B share and overseas corporate shares will be determined according to HKD:RMB bank’s Middle rate quoted by People’s Bank of China on the first working day after 2019 annual shareholders’ general meeting makes resolution on dividend distribution. (3) The Company's profit distribution preplan for 2020 is as follows: 1.10% of the net profit of the company i.e. 93232912.82 yuan is to be allocated for statutory common reserve fund. 2.The profit for 2020 is to be distributed as follows: 608424582.67 yuan. is to be allocated as the fund for dividend distribution for 2020. with the total shares at the end of 2020 i.e. 2090806126 shares as the base cash dividend of 2.91 yuan (including tax) is to be distributed for every 10 shares .The remaining undistributed profits are to be carried forward to the next year. The foreign exchange translation of the cash dividends for shareholders holding B share and overseas corporate shares will be determined according to HKD:RMB bank’s Middle rate quoted by People’s Bank of China on the first working day after 2020 annual shareholders’ general meeting makes resolution on dividend distribution. Dividend distribution of the latest three years In RMB Year for bonus shares Amount for cash bonus(tax included) Net profit attributable to common stock shareholders of listed company in consolidation statement for bonus year Ratio of the cash bonus in net profit attributable to common stock shareholders of listed company contained in consolidation statement Proportion for cash bonus by other ways(i.e.share buy-backs) Ratio of the cash bonus by other ways in net profit attributable to common stock shareholders of listed company contained in consolidation statement Total cash bonus(other ways included) Ratio of the total cash bonus (other ways included) in net profit attributable to common stock shareholders of listed company contained in consolidation statement 2020 608424582.67 867842774.78 70.11% 0.00 0.00% 608424582.67 70.11% 2019 882320185.17 1258628101.71 70.07% 0.00 0.00% 882320185.17 70.10% 2018 1175033042.81 1677028179.18 70.07% 0.00 0.00% 1175033042.81 70.07% In the reporting period both the Company’s profit and the parent company’s retained earnings were positive however not cash dividend distribution proposal has been put forward. □Applicable√ Not applicable II.Profit distribution plan and capitalizing of common reserves plan for the Period √ Applicable □ Not applicable Bonus shares for every ten shares(Shares) 0 Cash dividend for every ten shares (Yuan)(Tax-included) 2.91 Distribute additional (shares)for 10 shares A total number of shares as the distribution basis(shares) 2090806126 Cash dividend amount (yuan including tax 608424582.67 Other means (such as repurchase of shares) cash dividend amount (yuan) 0.00 Total cash dividend (yuan including tax) 608424582.67 Distributable profit (yuan) 3667543163.36 Proportion of cash dividend in the distributable profit 100% Cash dividend distribution policy The Company is in a fast growth stage there fore the cash dividend will reach 80% of the profit distribution at least. Cash dividend distribution policy. Details of profit distribution or reserve capitalization Preplan 1.10% of the net profit of the company i.e. 93232912.82 yuan is to be allocated for statutory common reserve fund. 2.The profit for 2020 is to be distributed as follows: 608424582.67 yuan. is to be allocated as the fund for dividend distribution for 2020. with the total shares at the end of 2020 i.e. 2090806126 shares as the base cash dividend of 2.91 yuan (including tax) is to be distributed for every 10 shares .The remaining undistributed profits are to be carried forward to the next year. The foreign exchange translation of the cash dividends for shareholders holding B share and overseas corporate shares will be determined according to HKD:RMB bank’s Middle rate quoted by People’s Bank of China on the first working day after 2020 annual shareholders’ general meeting makes resolution on dividend distribution. 2020 Annual Report III. Commitments to fulfill the situation 1.The fulfilled commitments in the reporting period and under-fulfillment commitments by the end of the reporting period made by the company shareholder actual controller acquirer director supervisor senior management personnel and other related parities. √Applicable □Not applicable Commitment Commitment maker Type Contents Time of making commitment Period of commitment Fulfillment Commitment on share reform Commitment in the acquisition report or the report on equity changes Commitment made upon the assets replacement Guangdong Provincial Freeway Co.Ltd. Performance commitment The predicted net profit of Guangdong Guanghui Expressway Co. Ltd. after deducting non-recurring gains and losses in 2020 2021 and 2022 (hereinafter referred to as "predicted net profit") is RMB 652477500 RMB 1112587300 and RMB 1234200900 respectively. According to the special audit opinion issued by the accounting firm if the accumulated realized net profit of Guangdong Guangzhou-Huizhou Expressway Co. Ltd. at the end of any fiscal year does not reach the accumulated predicted net profit within the compensation period Guangdong Provincial Freeway Co.Ltd. will compensate in cash as agreed.November 25 2020 Normal performan ce Guangdong Expressway Commitment on authenticity accuracy and completeness of the information provided 1. The explanations commitment and information provided by the Company for this transaction are authentic accurate and complete and there are no false records misleading statements or major omissions. 2. The information provided by the Company to the intermediaries that provide professional services such as auditing evaluation legal and financial consulting for this transaction is authentic accurate and complete original written information or duplicate information and the duplicate or photocopy of the information is consistent with its original information or original copy; The signatures and seals of all documents are authentic and the legal procedures required for November 25 2020 Permanently effective Normal performan ce 2020 Annual Report 38 Commitment Commitment maker Type Contents Time of making commitment Period of commitment Fulfillment signing and sealing have been fulfilled and legal authorization has been obtained; There are no false records misleading statements or major omissions. 3. The Company guarantees that it will provide timely information about this transaction in accordance with relevant laws and regulations relevant regulations of China Securities Regulatory Commission and Shenzhen Stock Exchange ensure the authenticity accuracy and completeness of such information and guarantee that there are no false records misleading statements or major omissions. 4. The Company shall bear individual and joint legal responsibilities for the authenticity accuracy and completeness of the information provided or disclosed for this exchange. In case of any loss caused to investors due to violation of the above commitments the Company will bear corresponding liability for compensation according to law. All directors supervisors and senior management personnel of Guangdong Expressway Commitment on authenticity accuracy and completeness of the information provided 1. The explanations commitment and information provided by the Promisee for this transaction are authentic accurate and complete and there are no false records misleading statements or major omissions. 2. The information provided by the Promisee to the intermediaries that provide professional services such as auditing evaluation legal and financial consulting for this transaction is authentic accurate and complete original written information or duplicate information and the duplicate or photocopy of the information is consistent with its original information or original copy; The signatures and seals of all documents are authentic and the legal procedures required for signing and sealing have been fulfilled and legal authorization has been obtained; There are no false records misleading statements or major omissions. 3. The Promisee guarantees that it will provide timely information about this transaction in accordance with relevant laws and regulations relevant regulations of China Securities Regulatory Commission and Shenzhen Stock Exchange ensure the authenticity accuracy and completeness of such information and guarantee that there are no false records misleading statements or major omissions. 4. If this transaction is suspected of false November 25 2020 Permanently effective Normal performan ce 2020 Annual Report Commitment Commitment maker Type Contents Time of making commitment Period of commitment Fulfillment records misleading statements or major omissions in the information provided or disclosed and is put on file for investigation by judicial organs or by China Securities Regulatory Commission the transfer of its shares with interests in the listed company will be suspended until the investigation conclusion of the case is obtained. 5. The Promisee shall bear individual and joint legal responsibilities for the authenticity accuracy and completeness of the information provided or disclosed for this exchange.In case of any loss caused to investors due to violation of the above commitments the Promisee will bear corresponding liability for compensation according to law. All directors supervisors and senior management personnel of Guangdong Expressway About the share reduction plan from the date of disclosure of the announcement of this reorganization to the completion of implementatio n From the date when the listed company disclosed this trading indicative announcement to the completion of this transaction I will not reduce the shares of the listed company directly or indirectly. If China Securities Regulatory Commission and Shenzhen Stock Exchange have new regulations on reduction I will also strictly abide by such regulations. If the above commitments are violated thus causing losses to the listed company or other investors I promise that I will be liable for compensation to the listed company or other investors according to law November 25 2020 Completion of this transaction Completio n of performan ce All directors supervisors and senior management Commitment on filling measures to dilute 1. I promise not to transfer benefits to other units or individuals without compensation or under unfair conditions nor to damage the interests of the Company by other means. 2. I promise to restrain my job consumption behavior. 3. I promise not to use the assets of the Company to engage in any investment and consumption activities unrelated to my November 25 2020 Permanently effective Normal performan ce 2020 Annual Report Commitment Commitment maker Type Contents Time of making commitment Period of commitment Fulfillment personnel of Guangdong Expressway immediate reward duties. 4. I promise that the salary system formulated by the Board of Directors or the Remuneration Committee of Guangdong Expressway will be linked with the implementation of the reward filling measures of Guangdong Expressway. 5. If Guangdong Expressway plans to implement equity incentive I promise that the exercise conditions of equity incentive of Guangdong Expressway to be announced will be linked with the implementation of the reward filling measures. 6. In case of any loss caused to Guangdong Expressway or its shareholders due to violation of the above commitments or refusal to perform the above commitments I will bear corresponding compensation responsibilities according to law.Guangdong Provincial Freeway Co.Ltd. Commitment on avoiding horizontal competition 1. The Company and its holding subsidiaries will not use the controlling shareholder's holding relationship with Guangdong Expressway to conduct business activities that harm the legitimate rights and interests of Guangdong Expressway its minority shareholders and its holding subsidiaries. 2. The Company and its holding subsidiaries will not use the information obtained from Guangdong Expressway and its holding subsidiaries to engage in the main business competing with Guangdong Expressway or its holding subsidiaries and will not engage in any acts or activities that damage or may damage the legitimate rights and interests of Guangdong Expressway its minority shareholders and its holding subsidiaries. 3. If the Company and its holding subsidiaries transfer any toll roads bridges tunnels and related ancillary facilities or rights invested or managed by the Company to a company other than Guangdong Communications Group Co. Ltd. and the company directly or indirectly controlled by it Guangdong Expressway will be entitled to the preemptive right under the same conditions unless the transferee is explicitly designated by the relevant government authorities under the premise permitted by relevant laws and regulations. 4. In the future if the Company and its holding subsidiaries invest in the construction of expressways parallel to or in the same direction within 20 km from each side of the expressway controlled by Guangdong June 262015 This letter of commitment is valid from the date of signing to the date when the Provincial Expressway is no longer controlled by the controlling shareholder of Guangdong Expressway Normal performan ce 2020 Annual Report Commitment Commitment maker Type Contents Time of making commitment Period of commitment Fulfillment Expressway Guangdong Expressway will enjoy the priority of investment over Guangdong Communications Group Co. Ltd. and its directly or indirectly controlled companies except Guangdong Expressway and its holding subsidiaries except for the projects whose investment entities are clearly designated by the relevant government authorities under the premise permitted by relevant laws and regulations.Guangdong Provincial Freeway Co.Ltd. Commitment on maintaining the independence of listed companies The Company will not damage the independence of Guangdong Expressway due to the increase of shares held by the Company after the completion of this major asset restructuring and will continue to maintain the principle of separation from Guangdong Expressway in terms of assets personnel finance organization and business and strictly abide by the relevant regulations of China Securities Regulatory Commission on the independence of listed companies and will not use Guangdong Expressway to provide guarantees nor occupy Guangdong Expressway funds illegally so as to maintain and protect the independence of Guangdong Expressway and protect the legitimate rights and interests of other shareholders of Guangdong Expressway.June 262015 This letter of commitment is valid from the date of signing to the date when the Provincial Expressway is no longer controlled by the controlling shareholder of Guangdong Expressway Normal performan ce Guangdong Provincial Freeway Co.Ltd. Commitment on reducing and standardizing related 1. After the completion of this major asset restructuring the Company and the companies directly or indirectly controlled by the Company and other related parties will try to avoid related transactions with Guangdong Expressway and its holding subsidiaries; Related transactions that are really necessary and unavoidable are carried out in accordance with the principles of fairness equity and compensation of equal June 26 2015 This letter of commitment is valid from the date of signing to the Normal performan ce 2020 Annual Report Commitment Commitment maker Type Contents Time of making commitment Period of commitment Fulfillment transactions value. The transaction price is determined at a reasonable price recognized by the market. The transaction approval procedures and information disclosure obligations are performed in accordance with relevant laws regulations and normative documents and the interests of Guangdong Expressway and its minority shareholders are effectively protected. 2. The Company guarantees to exercise shareholders' rights and fulfill shareholders' obligations in strict accordance with relevant laws and regulations rules and normative documents promulgated by China Securities Regulatory Commission business rules promulgated by Shenzhen Stock Exchange and Articles of Association of Guangdong Provincial Expressway Development Co. Ltd. and it will not use the controlling position of Guangdong Expressway's controlling shareholders to seek improper benefits or damage the legitimate rights and interests of Guangdong Expressway and its minority shareholders. date when the Provincial Expressway is no longer controlled by the controlling shareholder of Guangdong Expressway Guangdong Provincial Freeway Co.Ltd. Commitment on authenticity accuracy and completeness of the information provided 1. The information involved in the explanations and commitment provided by the Company for this transaction are authentic accurate and complete and there are no false records misleading statements or major omissions. 2. The information provided by the Company to the intermediaries that provide professional services such as auditing evaluation legal and financial consulting for this transaction is authentic accurate and complete original written information or duplicate information and the duplicate or photocopy of the information is consistent with its original information or original copy; The signatures and seals of all documents are authentic and the legal procedures required for signing and sealing have been fulfilled and legal authorization has been obtained; There are no false records misleading statements or major omissions. 3. The Company guarantees that it will provide timely information about this transaction in accordance with relevant laws and regulations relevant regulations of China Securities Regulatory Commission and Shenzhen Stock Exchange ensure the authenticity accuracy and completeness of such information and guarantee that there are no false November 25 2020 Permanently effective Normal performan ce 2020 Annual Report Commitment Commitment maker Type Contents Time of making commitment Period of commitment Fulfillment records misleading statements or major omissions.Guangdong Communicatio ns Group Co.Ltd.Guangdong Provincial Freeway Co.Ltd.. Guangdong Highway Construction Co. Ltd. Guangdong Communicatio ns Development Co. Ltd. and Xinyue Co.Ltd.Statement and commitment on share reduction plan From the date when the listed company disclosed this trading indicative announcement to the completion of this transaction the Company will not reduce the shares of the listed company directly or indirectly. If China Securities Regulatory Commission and Shenzhen Stock Exchange have new regulations on reduction the Company will also strictly abide by such regulations. If the above commitments are violated thus causing losses to the listed company or other investors the Company promise that it will be liable for compensation to the listed company or other investors according to law. For the Company's increased holdings of shares of listed companies due to issues such as share offering by listed companies and conversion of capital reserve into share capital the above commitment of not reducing its holdings will also be observed.November 25 2020 Completion of this transaction Completio n of performan ce Guangdong Provincial Freeway Co.Ltd. Commitment on maintaining the independence The Company and the companies directly or indirectly controlled by the Company except Guangdong Expressway and its holding subsidiaries will not damage the independence of Guangdong Expressway due to the increase in the shares of Guangdong Expressway held by the Company and the companies directly or indirectly controlled by the Company except Guangdong Expressway and its holding subsidiaries June 18 2015 This letter of commitment is valid from the date of signing to the Normal performan ce 2020 Annual Report Commitment Commitment maker Type Contents Time of making commitment Period of commitment Fulfillment of listed companies after the completion of this major asset restructuring and will continue to maintain the principle of separation from Guangdong Expressway in terms of assets personnel finance organization and business and strictly abide by the relevant regulations of China Securities Regulatory Commission on the independence of listed companies and will not use Guangdong Expressway to provide guarantees nor occupy Guangdong Expressway funds illegally so as to maintain and protect the independence of Guangdong Expressway and protect the legitimate rights and interests of other shareholders of Guangdong Expressway.date when the Provincial Expressway is no longer controlled by the controlling shareholder of Guangdong Expressway Guangdong Communicatio n Group Co.Ltd Commitment on avoiding horizontal competition 1. The Company and the companies directly or indirectly controlled by the Company except Guangdong Expressway and its holding subsidiaries will not use the controlling shareholder's holding relationship with Guangdong Expressway to conduct business activities that harm the legitimate rights and interests of Guangdong Expressway its minority shareholders and its holding subsidiaries. 2. The Company and the companies directly or indirectly controlled by the Company except Guangdong Expressway and its holding subsidiaries will not use the information obtained from Guangdong Expressway and its holding subsidiaries to engage in the main business competing with Guangdong Expressway or its holding subsidiaries and will not engage in any acts or activities that damage or may damage the legitimate rights and interests of Guangdong Expressway its minority shareholders and its holding subsidiaries. 3. If the Company and other companies directly or indirectly controlled by the Company except Guangdong Expressway and its holding subsidiaries transfer any toll roads bridges tunnels and related ancillary facilities or interests invested or managed by the Company to companies other than the Company directly or indirectly controlled by the Company Guangdong Expressway shall be entitled to the preemptive right under the same June 262015 This letter of commitment is valid from the date of signing to the date when the Provincial Expressway is no longer controlled by the controlling shareholder of Guangdong Expressway Normal performan ce 2020 Annual Report Commitment Commitment maker Type Contents Time of making commitment Period of commitment Fulfillment conditions unless the transferee is explicitly designated by the relevant government authorities under the premise permitted by relevant laws and regulations. 4. In the future if the Company and the companies directly or indirectly controlled by the Company except Guangdong Expressway and its holding subsidiaries invest in the construction of expressways parallel to or in the same direction within 20 km from each side of the expressway controlled by Guangdong Expressway Guangdong Expressway will be entitled to the priority investment right compared with the Company and the companies directly or indirectly controlled by the Company except Guangdong Expressway and its holding subsidiaries except for the projects whose investment entities are clearly designated by the relevant government authorities under the premise permitted by relevant laws and regulations.Guangdong Communicatio n Group Co.Ltd Commitment on reducing and standardizing related transactions 1. After the completion of this major asset restructuring the Company and other companies and other related parties directly or indirectly controlled by the Company except Guangdong Expressway and its holding subsidiaries will try to avoid related transactions with Guangdong Expressway and its holding subsidiaries; Related transactions that are really necessary and unavoidable are carried out in accordance with the principles of fairness equity and compensation of equal value. The transaction price is determined at a reasonable price recognized by the market. The transaction approval procedures and information disclosure obligations are performed in accordance with relevant laws regulations and normative documents and the interests of Guangdong Expressway and its minority shareholders are effectively protected. 2. The Company guarantees to exercise shareholders' rights and fulfill shareholders' obligations in strict accordance with relevant laws and regulations rules and normative documents promulgated by China Securities Regulatory Commission business rules promulgated by Shenzhen Stock Exchange and Articles of Association of Guangdong Provincial Expressway Development Co. Ltd. and it will not use the controlling position of June 182015 This letter of commitment is valid from the date of signing to the date when the Provincial Expressway is no longer controlled by the controlling shareholder of Guangdong Normal performan ce 2020 Annual Report Commitment Commitment maker Type Contents Time of making commitment Period of commitment Fulfillment controlling shareholders to seek improper benefits or damage the legitimate rights and interests of Guangdong Expressway and its minority shareholders. Expressway Guangdong Communicatio n Group Co.Ltd Commitment on authenticity accuracy and completeness of the information provided 1. The explanations commitment and information provided by the Company for this transaction are authentic accurate and complete and there are no false records misleading statements or major omissions. 2. The information provided by the Company to the intermediaries that provide professional services such as auditing evaluation legal and financial consulting for this transaction is authentic accurate and complete original written information or duplicate information and the duplicate or photocopy of the information is consistent with its original information or original copy; The signatures and seals of all documents are authentic and the legal procedures required for signing and sealing have been fulfilled and legal authorization has been obtained; The validity of the originals of each document has not been revoked within its validity period and such originals are held by their respective legal holders up to now; There are no false records misleading statements or major omissions. 3. The Company guarantees that if there are false records misleading statements or major omissions in the information provided or disclosed for this transaction which are filed for investigation by judicial organs or filed for investigation by China Securities Regulatory Commission before the investigation conclusion is revealed the Company promises to suspend the transfer of shares with interests in Guangdong Expressway and submit the written application for suspension of transfer and the stock account to the Board of Directors of Guangdong Expressway within two trading days after receiving the notice of filing inspection and the Board of Directors of Guangdong Expressway will apply for locking on behalf of the Company to the stock exchange and the registration and clearing company; If the application for locking is not submitted within two trading days the November 25 2020 Permanently effective Normal performan ce 2020 Annual Report Commitment Commitment maker Type Contents Time of making commitment Period of commitment Fulfillment Board of Directors of Guangdong Expressway is authorized to directly submit the identity information and account information of the Company to the stock exchange and the registration and clearing company after verification and apply for locking; If the Board of Directors of Guangdong Expressway fails to submit the Company's identity information and account information to the stock exchange and the registration and clearing company the stock exchange and the registration and clearing company are authorized to directly lock the relevant shares. If the investigation results show that there are violations of laws and regulations the Company promises to lock in shares and use them voluntarily for compensation arrangements of relevant investors. 4. The Company shall bear individual and joint legal responsibilities for the authenticity accuracy and completeness of the information provided or disclosed for this exchange. In case of any loss caused to Guangdong Expressway or investors due to violation of the above commitments the Company will bear corresponding liability for compensation according to law.Guangdong Communicatio n Group Co.Ltd Commitment on fulfilling filling measures to dilute immediate reward 1. It will not interfere with the business activities of Guangdong Expressway beyond authority and will not encroach on the interests of Guangdong Expressway. 2. In case of any loss caused to Guangdong Expressway or investors due to violation of the above commitments the Company will bear corresponding liability for compensation according to law.November 25 2020 Permanently effective Normal performan ce Commitment on land and real estate of Guanghui 1. The land occupied and used by Guangzhou-Huizhou Expressway with a total area of 3732185.08 square meters has not yet obtained the ownership certificate. The Company undertakes that: (1) The ownership of the land use right of the above-mentioned land is clear with no dispute and Guangzhou-Huizhou Expressway November 25 2020 Permanently effective Normal performan ce 2020 Annual Report Commitment Commitment maker Type Contents Time of making commitment Period of commitment Fulfillment Expressway can legally occupy and use the above-mentioned land; (2) Guangzhou-Huizhou Expressway will continue to effectively occupy and use the relevant land before the ownership certificate is obtained and will not be materially adversely affected thereby; (3) After the completion of this transaction if Guangdong Expressway suffers losses as a shareholder of Guangzhou-Huizhou Expressway for losses suffered because Guangzhou-Huizhou Expressway occupies and uses the above-mentioned land without ownership certificate or engages in engineering construction on such land the Company will bear the actual losses suffered by Guangdong Expressway. 2. The land occupied and used by Guangzhou-Huizhou Expressway with a total area of 12324867.92 square meters is currently registered under the name of Guangdong Changda Highway Engineering Co. Ltd. (now renamed as "Poly Changda Engineering Co. Ltd." hereinafter referred to as "Changda Company") of which 8799336.79 square meters of land has obtained the ownership certificate and the other 3525531.13 square meters of land has not yet obtained the ownership certificate. The Company promises that after the completion of this transaction if Guangdong Expressway suffers losses as a shareholder of Guangzhou-Huizhou Expressway and because Guanghui Expressway occupies and uses the land registered under the name of Changda Company the Company will bear the actual losses suffered by Guangdong Expressway. 3. The property ownership certificate has not been obtained for the property with a total area of 72364.655 square meters occupied and used by Guangzhou-Huizhou Expressway. The Company promises that: (1) The ownership of the above-mentioned property without ownership certificate currently used by Guanghui Expressway is clear with no dispute and Guangzhou-Huizhou Expressway can legally occupy and use the above-mentioned property; (2) Guangzhou-Huizhou Expressway will continue to effectively occupy and use the above-mentioned property before the property ownership certificate is obtained and will not be materially adversely affected; (3) After the completion of this 2020 Annual Report Commitment Commitment maker Type Contents Time of making commitment Period of commitment Fulfillment transaction if Guangdong Expressway suffers losses as a shareholder of Guangzhou-Huizhou Expressway and because Guangzhou-Huizhou Expressway occupies and uses the above-mentioned property without relevant property ownership certificate the Company will bear the actual losses suffered by Guangdong Expressway.Guangdong Guanghui Expressway Co. Ltd. Commitment on authenticity accuracy and completeness of the information provided 1. The explanations commitment and information provided by the Company for this transaction are authentic accurate and complete and there are no false records misleading statements or major omissions. 2. The information provided by the Company to the intermediaries that provide professional services such as auditing evaluation legal and financial consulting for this transaction is authentic accurate and complete original written information or duplicate information and the duplicate or photocopy of the information is consistent with its original information or original copy; The signatures and seals of all documents are authentic and the legal procedures required for signing and sealing have been fulfilled and legal authorization has been obtained; There are no false records misleading statements or major omissions. 3. The Company guarantees that it will provide timely information about this transaction in accordance with relevant laws and regulations relevant regulations of China Securities Regulatory Commission and Shenzhen Stock Exchange ensure the authenticity accuracy and completeness of such information and guarantee that there are no false records misleading statements or major omissions. 4. The Company shall bear individual and joint legal responsibilities for the authenticity accuracy and completeness of the information provided or disclosed for this exchange. In case of any loss caused to investors due to violation of the above commitments the Company will bear corresponding liability for compensation according to law.November 25 2020 Permanently effective Normal performan ce Guangdong Communicatio Other commitment In order to promote the smooth progress of the issue of shares the cash purchase of assets and the raising of matching funds (hereinafter referred to as "the major asset April 272019 It continued to push Normal performan 2020 Annual Report Commitment Commitment maker Type Contents Time of making commitment Period of commitment Fulfillment n Group Co.Ltd restructuring") approved by Guangdong Expressway Development Co. Ltd. at its second extraordinary shareholders' meeting in 2015 with regard to all the land and real estate (hereinafter referred to as "relevant land and real estate") owned by Guangdong Fokai Expressway Co. Ltd. (hereinafter referred to as "Fokai Company") and Jingzhu Expressway Guangzhu Section Co. Ltd. (hereinafter referred to as "Guangzhu East Company") without ownership certificates (hereinafter referred to as "relevant land and real estate") disclosed in the report of Guangdong Expressway Development Co. Ltd.on issuing shares and paying cash to purchase assets and raising matching funds and related transactions the company undertook to urge Fokai Company and Guangzhu East Company to go through the ownership registration formalities according to the following plan under the condition that it is conducive to safeguarding the rights and interests of listed companies; Continued to push forward the progress of accreditation and completed the registration procedures of relevant land and real estate ownership within three years after the relevant policies were clear and the relevant land and real estate met the conditions for handling the registration procedures of ownership in accordance with the relevant laws and regulations and the requirements of the competent government departments.forward the progress of accreditation and completed the registration procedures of relevant land and real estate ownership within three years after the relevant policies were clear and the relevant land and real estate met the conditions for handling the registration procedures of ownership in accordance with the relevant laws ce 2020 Annual Report Commitment Commitment maker Type Contents Time of making commitment Period of commitment Fulfillment and regulations and the requirements of the competent government departments Commitments made upon first issuance or refinance Equity incentive commitment Other commitments made to minority shareholders Completed on time(Y/N) Yes Where the commitment is overdue and has not been fulfilled then the specific reasons for the failure to complete and the next work plan shall be specified 2.The existence of the company's assets or projects earnings forecasts and earnings reporting period is still in the forecast period the company has assets or projects meet the original profit forecast made and the reasons explained √Applicable □ Not applicable Earnings forecast asset or project name Forecast start time Forecast end time Current forecast performance (RMB 10， 000） Current Actual performance (RMB 10， 000） Reasons for not meeting the forecast (if applicable) Original forecast disclosure date Original forecast disclosure index Guanghui Expressway Co. Ltd. January 1 2020 December 31 2022 65247.75 76923.26 Not applicable November 262020 www.cninfo.com.cn Note： The disclosure index includes the link to the website originally predicted to be disclosed the date of disclosure th e name of the announcement the number of the announcement etc. Commitments made by the company’s shareholders and counterparties in the reporting year’ s operating performance □ Applicable √ Not applicable The completion of performance commitments and its impact on the impairment test of goodwill In 2020 the actual net profit of Guangdong Guanghui Expressway Co. Ltd. after deducting non-recurring gains a nd losses was RMB 769232600 which was RMB 116755100 more than the promised amount of RMB 652477 500. IV. Particulars about the non-operating occupation of funds by the controlling shareholder □ Applicable √ Not applicable Nome V. Explanation of the Supervisory Committee and Independent Directors (If applicable)on the Qualified Auditor’s Report Issued by the CPAs. □ Applicable √Not applicable VI. Explain change of the accounting policy accounting estimate and measurement methods as compared with the financial reporting of last year. √Applicable □ Not applicable (I) Changes in accounting policies The Ministry of Finance issued the " No. 14Accounting Standards for Business Enterprises-Revenue (2017 Revision)" (No. 22-[2017]Caikuai) (hereinafter referred to as the "New Revenue Standards") on July 5 2017. As approved by the fourth meeting of the ninth board of directors of the Company on April 3 2020 the Company shall begin to implement the aforementioned new revenue standards on January 1 2020. The new revenue standard establishes a new revenue recognition model for regulating revenue generated from contracts with customers. In order to implement the new revenue standards the Company reassessed the recognition and measurement accounting and presentation of revenue of main contract. According to the provisions of the new revenue standard the selection is only to adjust the cumulative impactamount of contracts that have not been completed on January 1 2020. The first adjustment amount of cumulative impact of the first implementation is to implement the amount of retained earnings and other related items in the financial statements at the beginning of the first implementation period (ie January 1 2020) and it shall not be adjusted for the comparable period information.(II) Changes in accounting estimates 1.On December 31 2019 the Company held the 3rd (provisional) meeting of the ninth board of directors which passed the Proposal on Changes in Accounting Estimates and agreed to adopt the Traffic Volume Forecast and Charge Revenue Report of Foshan-Kaiping Expressway and the Traffic Volume Forecast and Charge Revenue Report of Guangzhu Section of Jingzhu Expressway issued by Guangdong Transportation Planning and Design Institute Co. Ltd. in 2019 for the Fokai Branch of Guangdong Expressway Development Co. Ltd. a branch of the Company and Jingzhu Expressway Guangzhu Section Co. Ltd. a holding subsidiary from January 1 2020.The Company adopts the future applicable method for this item. This change in accounting estimate results in a decrease of RMB172308077.27 in depreciation of fixed assets in the current period than the original accounting estimate a decrease of RMB 172308077.27 in operating cost an increase of RMB 129231057.95 in net profit attributable to the shareholders of the parent company an increase of RMB123155223.57 in net profit attributable to the minority shareholders of the parent company，and an increase of RMB 6075834.39 in Impactattributable to minority shareholder gains and losses. 2. On August 26 2020 the Company held the 9th (provisional) meeting of the ninth board of directors which passed the Proposal on Changes in Accounting Estimates It is agreed that from September 1 2020 the depreciation period of machinery and equipment electronic equipment and other equipment has been changed and the net salvage value rate of fixed assets (except road property) has also been changed. For this matter the Company adopts the future applicable method and such change in accounting estimate results in depreciation of fixed assets in the current period of RMB 33759072.50 more than the original accounting estimate.an increase of RMB 33759072.50 in operating cost a decrease of RMB25319304.38 in net profit，a decrease of RMB24086113.34 in net profit attributable to the minority shareholders of the parent company，and a decrease of RMB1233191.05 in Impact attributable to minority shareholder gains and losses. VII.Explain retrospective restatement due to correction of significant accounting errors in the reporting period □Applicable √ Not applicable None VIII.Explain change of the consolidation scope as compared with the financial reporting of last year. √Applicable □ Not applicable 1.Compared with 2019 the scope of consolidation in this year was reduced to Guangzhou Guangzhu Transportation Investment Management Co. Ltd. which was due to the internal consolidation by merger of the Company. 2.Compared with 2019 Guangdong Guanghui Expressway Co. Ltd. was added to the scope of consolidation this year because the Company acquired its 21% equity and held 51% equity of Guanghui Expressway and Guanghui Expressway was changed from an affiliated company to a subsidiary.IX. Engagement/Disengagement of CPAs CPAs currently engaged Name of the domestic CPAs YongTuo Certified Public Accountants (Special General Partnership) Remuneration for domestic accounting firm (Ten thousands yuan) 127.20 Successive years of the domestic CPAs offering auditing services 1 Continuous fixed number of year for the auditing service provided by CPA in domestic CPA Firms 1 Has the CPAs been changed in the current period √ Yes □ No Whether to change the employment of accounting firm during the audit period □ Yes √No Whether to perform the examination and approval procedures for change of accounting firm √ Yes □ No A detailed explanation of the change of employment and accounting firm The 6th meeting of the 9th Board of Directors held on June 8 2020 deliberated and passed the Proposal on Hiring Audit Institution for Financial Report in 2020 agreeing that the Company would hire Yong Tuo Certified Public Accountants (Special General Partnership) as the audit institution for the Company's financial report in 2020. On June 29 2020 the company's shareholders' meeting in 2019 deliberated and passed the Proposal on Hiring Audit Institution for Financial Report in 2020. Description of the CPAs financial adviser or sponsor engaged for internal control auditing √Applicable □ Not applicable 1.The 6th meeting of the 9th Board of Directors held on June 8 2020 deliberated and passed the Proposal on Hiring Audit Institution for Financial Report in 2020 agreeing that the Company would hire Yong Tuo Certified Public Accountants (Special General Partnership) as the audit institution for the Company's financial report in 2020. On June 29 2020 the company's shareholders' meeting in 2019 deliberated and passed the Proposal on Hiring Audit Institution for Financial Report in 2020. 2.During the reporting period the Company hired China International Capital Corporation as an independent financial adviser for the Company to acquire 21% of the shares of Guanghui Company held by the Provincial Expressway Company through cash payment. X. Situation of Facing Listing Suspension and Listing Termination after the Disclosure of the Yearly Report □Applicable √ Not applicable XI. Relevant Matters of Bankruptcy Reorganization □Applicable √ Not applicable None XII. Matters of Important Lawsuit and Arbitration □Applicable √ Not applicable XIII. Situation of Punishment and Rectification □Applicable √ Not applicable None XIV. Credit Condition of the Company and its Controlling Shareholders and Actual Controllers □Applicable √ Not applicable XV. Implementation Situation of Stock Incentive Plan of the Company Employee Stock Ownership Plan or Other Employee Incentive Measures □Applicable √ Not applicable None XVI. Material related transactions 1. Related transactions in connection with daily operation □Applicable √ Not applicable None 2. Related-party transactions arising from asset acquisition or sale □Applicable √ Not applicable None 3. Related-party transitions with joint investments □Applicable √ Not applicable None 4. Credits and liabilities with related parties □Applicable √ Not applicable None 5. Other significant related-party transactions √Applicable □ Not applicable 1. In the 3rd (Provisional) meeting of the ninth session of the board of directors of the Company it deliberated and approved the "Proposal on Borrowing Entrusted Loans from Guangdong Jiangzhong Expressway Co. Ltd." and agreed that the Company borrowed unsecured entrusted loans from Guangdong Jiangzhong Expressway Cp.Ltd with the loan amount does not exceed 18 million yuan which shall be drawn according to the actual needs of the Company and shall be used for daily business turnover with a term of 5 years and using the "1+1+1+1+1" model-that is every year is one loan cycle and if the Company does not propose to repay the loan the loan will be automatically transferred to the next one-year period. The interest rate is 10%lowered than the benchmark one-year loan interest rate announced by the People's Bank of China and it’s adjusted annually. 2. In the 4th meeting of the ninth board of directors of the Company it deliberated and approved the "Proposal on the Company’s Estimated Routine Related Party Transactions in 2020" agreed to the estimated routine related transactions in 2020 for the Company’s headquarter and its wholly-owned and holding subsidiaries’ with the transaction amount totaled in 64091200 yuan. 3. In the 5th (Provisional) meeting of the ninth session of the board of directors of the Company it reviewed and approved the "Proposal on Renewing the Lease of Litong Plaza Office Place" agreeing that the Company will continue to lease the 43 44 full-floor units (full-floor units of floors 45 46 upon it self-edited) of the planned floors of Litong Plaza from Guangdong Litong Real Estate Investment Co. Ltd for office space with a lease term of 3 years-from May 5 2020 to May 4 2023. The monthly rent for the period from May 5 2020 to May 4 2021 is 815233.68 yuan the monthly rent for the period from May 5 2021 to May 4 2022 is 839690.69 yuanand the monthly rent for the period from May 5 2022 to May 4 2023 is 864884.64 yuan.. 4. In the 6th (Provisional) meeting of the eighth session of the Company’s board of directors it deliberatedand approved the “Proposal on the signing of the 2018-2020 entrusted operation and management contract ofGuangzhu North Section of Guangdong Jingzhu Expressway between the Guangzhu Section Company and the Guangzhu North Section Company agreed to the Jingzhu Expressway Guangzhu Section Co. Ltd. (hereinafter referred to as "Guangzhu Section Company") and Guangdong Jingzhu Expressway Guangzhu North Section Co.Ltd. (hereinafter referred to as "Guangzhu North Section Company") to sign “The 2018-2020 Entrusted OperationManagement Contract for the North Section of Guangzhu Sectionof Guangdong Jingzhu Expressway with the total contract amount does not exceed 60 million yuan. For details of this matter please refer to the "Announcement on Related Party Transaction on Entrusted Operations of Subsidiaries" published by the Company on January 31 2018. 5. In the 12th (Provisional) meeting of the Ninth Session of the Board of Directors of the Company it reviewed and approved the "Proposal on Renewing the Financial Service Agreement with Guangdong Communication Group Finance Co. Ltd.". 6. In the 13th (Provisional) meeting of the ninth board of directors of the Company and the third extraordinary general meeting of shareholders in 2020 it reviewed and approved the "Proposal on the Company's Major Asset Reorganization Namely the Related Party Transaction" and agreed to the Company acquiring 21% equity of Guanghui Expressway held by Provincial Expressway through cash payment.The website to disclose the interim announcements on significant related-party transactions Description of provisional announcement Date of disclosing provisional announcement Description of the website for disclosing provisional announcements Announcement of related party transaction January 22020 www.cninfo.com.cn Estimates announcement of the Daily Related Party Transaction of 2020 April72020 www.cninfo.com.cn Announcement of related party transaction April 292020 www.cninfo.com.cn Announcement on related transactions to the entrusted operation by subsidiaries June 92020 www.cninfo.com.cn Announcement of related party transaction October 292020 www.cninfo.com.cn Announcement of Resolutions of the 13th November 262020 www.cninfo.com.cn (Provisional) Meeting of the Ninth Board of Directors "Major Asset Purchases and Related Party Transactions Report" etc Announcement of Resolution of the Third Provisional Shareholder's Meeting December 162020 www.cninfo.com.cn XVII. Particulars about significant contracts and their fulfillment 1. Particulars about trusteeship contract and lease (1) Trusteeship □Applicable √ Not applicable None (2) Contract □ Applicable √ Not applicable None (3) Lease □Applicable √ Not applicable None 2.Guarantees √ Applicable □Not applicable （1）Guarantees In RMB Guarantee of the Company for the controlling subsidiaries (Exclude controlled subsidiaries) Name of the Company Relevant disclosure date/No. of the guaranteed amount Amount of Guarantee Date of happening (Date of signing agreement) Actual mount of guarantee Guarantee type Guarantee term Complete implemen tation or not Guarantee for associated parties (Yes or no) Guangdong Communicat ion Group Co.Ltd May 11 2012 172500 May 312013 172500 Pledge 2012.9.25- 2020.3.25 Yes Yes Total of external guarantee approved at Period-end(A3) 0.00 Total balance of actual external guarantee at Period-end(A4) 0.00 Guarantee of the Company for the controlling subsidiaries Name of the Company guaranteed Relevant disclosure date/No. of the guaranteed amount Amount of guarantee Date of happening (Date o signing agreement) Actual mount of guarantee Guarantee type Guarantee term Complete implemen tation or not Guarantee for associated parties (Yes or no) Guarantee of the subsidiaries for the controlling subsidiaries Name of the Company guaranteed Relevant disclosure date/No. of the guaranteed amount Amount of guarantee Date of happening (Date o signing agreement) Actual mount of guarantee Guarantee type Guarantee term Complete implemen tation or not Guarantee for associated parties (Yes or no) Total of Company’s guarantee（namely total of the large three aforementioned） Total of guarantee at Period-end（A3+B3+C3） 0.00 Total of actual guarantee at Period-end （A4+B4+C4） 0.00 The proportion of the total amount of actually guarantee in the net assets of the Company(that is A4+B4+C4) 0.00 Including Amount of guarantee for shareholders actual controller and its associated parties（D） 0.00 Total guarantee Amount of the abovementioned guarantees（D+E+F） 0.00 Note （2）Illegal external guarantee □ Applicable √ Not applicable None 3.Situation of Entrusting Others for Managing Spot Asset (1)Situation of Entrusted Finance □ Applicable √ Not applicable None (2)Situation of Entrusted Loans 4.Major contracts for daily operations □ Applicable √ Not applicable None 5. Other significant contract □ Applicable √ Not applicable None XVIII. Social responsibility 1. Execution of social responsibility of targeted poverty alleviation In 2020 the Company strived to overcome the adverse effects of the epidemic worked pragmatically and solidly and overcome the difficulties. While strictly implementing various prevention and control measures to achieve zero infection in the Company it stood firmly in the front line of epidemic prevention ensured smooth roads traffic and fully coordinate the promotion of normalized epidemic prevention and control and promoted the Company’s various tasks effectively promoted the stability and improvement of its economic operations. (1) In order to prevent and control the epidemic the Company's participation-in and holding expressway companies actively responded to the higher-level policies and from 00:00 on February 17 2020 to 24:00 on May 5 the vehicle tolls of the national toll road were exempted. The Company’s party committee and management team actively mobilized volunteers from the party working group to participate in the epidemic prevention and control work to effectively fight the epidemic. (2) The policy of exemption of tolls intermittent toll-free release and green channel preferential policies for passenger cars with less than seven seats on highways during major holidays shall continue to be implemented.Guangfo Company Fokai Branch Guangzhu-Dong Company and Guanghui Company effectively implemented the " Recognition personnel responsibilities and measures are in place" and successfully completed various tasks to ensure safety and smooth flow. (3)Actively responded to government policies and provided preferential reductions and exemptions in accordance with laws and regulations to reduce corporate transportation costs and public travel costs. (4)Conscientiously implemented the government's tasks and completed the transformation and switching of the ETC toll collection system at the provincial toll station on time. After the resumption of toll collection on May 6 2020 the Company's holding section of toll gates ran smoothly Yuetong Card Expressway service points were operated in an orderly manner the toll lane fee display and data transmission were normal the lane configuration was continuously optimized and the ETC system is generally stably operated. 2.Overview of the targeted poverty alleviation The company has no precise social responsibility for poverty alleviation in the period and bas no follow-up plan either. 3.Major environmental protection The Listed Company and its subsidiary whether belongs to the key sewage units released from environmental protection department No XIX. Explanation on other significant events □ Applicable √Not applicable None XX. Significant event of subsidiary of the Company □ Applicable √Not applicable VI. Change of share capital and shareholding of Principal Shareholders I. Changes in share capital 1. Changes in share capital In shares Before the change Increase/decrease（+，-） After the Change Amount Proportion Share allotm ent Bon us shar es Capitali zation of common reserve fund Other Subtotal Quantity Proporti on 1.Shares with conditional subscription 439384658 21.02% -12994 1 -129941 439254717 21.01% 1.State-owned shares 410032765 19.61% 7931 7931 410040696 19.61% 2.State-owned legal person shares 21712738 1.04% 0 21712738 1.04% 3.Other domestic shares 7639155 0.37% -13787 2 -137872 7501283 0.36% Including ：Domestic Legal person shares 7028355 0.34% -63260 -63260 6965095 0.33% Domestic natural person shares 610800 0.03% -74612 -74612 536188 0.03% 4.Foreign shares 0 0.00% 0 0 0 0.00% Including：Foreign legal person shares 0 0.00% 0 0 0.00% Foreign natural person shares 0 0.00% 0 0 0.00% II.Shares with unconditional subscription 1651421468 78.98% 12994 1 129941 1651551409 78.99% 1.Common shares in RMB 1302772793 62.31% 12994 1 129941 1302902734 62.32% 2.Foreign shares in domestic market 348648675 16.68% 0 0 348648675 16.68% 3.Foreign shares in foreign market 0 0.00% 0 0 0 0.00% 4.Other 0 0.00% 0 0 0 0.00% III. Total of capital shares 2090806126 100.00% 0 0 2090806126 100.00% Reasons for share changed √ Applicable □Not applicable 1. Within the reporting period 17 shareholders reimbursed 7931 shares of Guangdong Provincial Communication Group Co.Ltd. which were converted from domestic natural person to "national shareholding". 2.During the reporting period 51，112 shares held by domestic natural persons with limited sales conditions were converted into shares with unlimited sales conditions. 3.During the reporting period 63，260 shares held by domestic natural persons with limited sales conditions were from domestic Legal person. 4.During the reporting period Ms. Li Mei the outgoing supervisor，held 86629 restricted shares and changed them into unrestricted shares. 4.During the reporting period Mr. Du Jun the outgoing Director，held 7800 Unrestricted shares and changed them into restricted shares. Approval of Change of Shares □Applicable √Not applicable Ownership transfer of share changes □Applicable √Not applicable Influence on the basic EPS and diluted EPS as well as other financial indexes of net assets per share attributable to common shareholders of Company in latest year and period □Applicable √Not applicable Other information necessary to disclose for the company or need to disclosed under requirement from security regulators □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 Influence on the basic EPS and diluted EPS as well as other financial indexes of net assets per share attributable to common shareholders of Company in latest year and period □ Applicable √ Not applicable Other information necessary to disclose for the company or need to disclosed under requirement from security regulators □Applicable √Not applicable 2. Change of shares with limited sales condition √ Applicable □Not applicable In shares Shareholder Name Initial Restricted Shares Number of Unrestricted Shares This Term Number of Increased Restricted Shares This Term Restricted Shares in the End of the Term Reason for Restricted Shares Date of Restriction Removal Guangdong Communication Group Co. Ltd. 410032765 7931 410040696 The shares for restricted sales by share reform has not yet be subject to the procedures for lifting the restriction.Unknown Wang Jianhua and other 17 shareholders 59043 51112 0 Release of restrictions on sales June 242020 Li Mei 86629 86629 0 Deletion of top Supervisor locking shares January 2020 Du Jun 0 7800 7800 Top director locking shares Unknown Total 410178437 15731 137741 410048496 -- -- II. Securities issue and listing 1.Explanation of the Situation of the Security Issue(No Preferred Shares) in the Report Period □ Applicable √ Not applicable 2.Change of asset and liability structure caused by change of total capital shares and structure □ Applicable √ Not applicable 3.About the existing employees’ shares □Applicable √Not applicable III. Shareholders and actual controlling shareholder 1. Number of shareholders and shareholding In Shares Total number of common shareholders at the end of the reporting period 36100 Total shareholders at the end of the month from the date of disclosing the annual report 55412 The total number of preferred shar eholders voting r ights restored at period-end (if any)(Note 8) 0 Total preference shareholders with voting rights recovered at end 0 of last month before annual report disclosed(if any)(Note8) Particulars about shares held above 5% by shareholders or top ten shareholders Shareholders Nature of shareholder Proport ion of shares held （%） Number of shares held at period -end Changes in reporting period Amount of restricted shares held Amount of un-restricted shares held Number of share pledged/frozen State of share Amou nt Guangdong Communication Group Co.Ltd State-owned legal person 24.56% 513420438 7931 410040696 103379742 Guangdong Highway Construction Co. Ltd State-owned legal person 22.30% 466325020 466325020 Shangdong Expressway Investment Development Co. Ltd. State-owned legal person 9.68% 202429149 202429149 Tibet Yingyue Investment Management Co. Ltd.State-owned legal person 4.84% 101214574 101214574 Guangdong Provincial Freeway Co.Ltd. State-owned legal person 2.53% 52937491 19582228 33355263 China Life Insurance Co. Ltd.－Dividend －Personal dividend -005L-FH002 Shen Other 1.96% 41009355 6233802 41009355 China Life Insurance Co. Ltd.－Traditional －Common insurance products-005L-CT001S hen Other 1.78% 37225847 5913227 37225847 Feng Wuchu Domestic natural person shares 0.99% 20793853 4329406 20793853 Xinyue Co. Ltd.Overseas legal person 0.63% 13201086 13201086 Guangdong Tapai Domestic non 0.55% 11550604 11150604 11550604 Group Co. Ltd. State-owned Legal person Strategic investor or general legal person becoming top-10 ordinary shareholder dueto rights issue (if any)（See Note 3)None Related or acting-in-concert parties among shareholders above Guangdong Communication Group Co. Ltd. is the parent company of Guangdong Highway Construction Co. Ltd. and Guangdong Provincial Freeway Co.Ltd. ， It isunknown whether there is relationship between other shareholders and whether they are persons taking concerted action specified in the Regulations on Disclosure of Information about Change in Shareholding of Shareholders of Listed Companies.Shareholding of top 10 shareholders of unrestricted shares Name of the shareholder Quantity of unrestricted shares held at the end of the reporting period Share type Share type Quantity Guangdong Highway Construction Co.Ltd 466325020 RMB Common shares 466325020 Shangdong Expressway Investment Development Co. Ltd. 202429149 RMB Common shares 202429149 Guangdong Communication Group Co.Ltd 103379742 RMB Common shares 103379742 Tibet Yingyue Investment Management Co. Ltd. 101214574 RMB Common shares 101214574 China Life Insurance Co. Ltd.－Dividend －Personal dividend -005L-FH002 Shen 41009355 RMB Common shares 41009355 China Life Insurance Co. Ltd.－ Traditional－Common insurance products-005L-CT001Shen 37225847 RMB Common shares 37225847 Guangdong Provincial Freeway Co.Ltd. 33355263 RMB Common shares 33355263 Feng Wuchu 20793853 RMB Common shares 18487990 Foreign shares placed in domestic 2305863 Xinyue Co. Ltd. 13201086 Foreign shares placed in domestic 13201086 Guangdong Tapai Group Co. Ltd. 11550604 RMB Common shares 11550604 Explanation on associated relationship or consistent action among the top 10 shareholders of non-restricted negotiable shares and that between the top 10 shareholders of non-restricted negotiable shares and top 10 shareholders Guangdong Communication Group Co. Ltd. is the parent company of Guangdong Highway Construction Co. Ltd. and Guangdong Provincial Freeway Co.Ltd. ， It isunknown whether there is relationship between other shareholders and whether they are persons taking concerted action specified in the Regulations on Disclosure of Information about Change in Shareholding of Shareholders of Listed Companies.Top 10 ordinary shareholders conducting None securities margin trading (if any) (see note 4) Whether top ten common shareholders or top ten common shareholders with un-restrict shares held have a buy-back agreement dealing in reporting period.□ Yes √ No The top ten common shareholders or top ten common shareholders with un-restrict shares held of the Company have no buy –back agreement dealing in reporting period. 2.Controlling shareholder Nature of Controlling Shareholders: Local state holding Type: Legal person Name of the Controlling shareholder Legal representat ive/Leader Date of incorporation Organization code Principal business activities Guangdong Communication Group Co. Ltd. Deng Xiaohua June 232000 91440000723838552J Equity management organization of asset reorganization and optimized allocation raising funds by means including mortgage transfer of property rights and joint stock system transformation project investment operation and management traffic infrastructure construction highway and railway project operation and relevant industries technological development application consultation and services highway and railway passenger and cargo transport ship industry relevant overseas businesses; Value added telecommunication services. Equity in other domestic and foreign listed companies held by the controlling shareholder by means of control and mutual shareholding in the reporting period Guangdong Communication Group Co. Ltd. holds 74.12% equity of Guangdong Nanyue Logistics Co. Ltd.a company listing H shares.Type of Controlling Shareholders: Legal person Changes of controlling shareholder in reporting period □ Applicable √ Not applicable No changes of controlling shareholder for the Company in reporting period. 3．Information about the controlling shareholder of the Company Actual controller nature：Local state owned assets management Actual controller type：Legal person Name of the actual controller Legal representative /Leader Date of incorporation Organization code Principal business activities State-owned Assets supervision and administration Commission of Guangdong Provincial People’s Government Li Cheng June 262004 114400007583361658 As an ad hoc body directly under the Guangdong Provincial People's Government commissioned by the provincial government to fulfill the State-owned asset investor regulatory enterprises to implement the rights obligations and responsibilities pipe asset control and people management. Equity of other domestic/foreign listed company with share controlling and share participation by controlling shareholder in reporting period As an ad hoc body directly under the Guangdong Provincial People's Government commissioned by the provincial government to fulfill the State-owned asset investor regulatory enterprises to implement the rights obligations and responsibilities pipe asset control and people management. Changes of controlling shareholder in reporting period □ Applicable √ Not applicable No changes of controlling shareholder for the Company in reporting period Block Diagram of the ownership and control relations between the company and the actual controller The actual controller controls the company by means of trust or managing the assets in other way □Applicable √Not applicable 4.Particulars about other legal person shareholders with over 10% share held √ Applicable □Not applicable Legal person shareholder Legal person/person in charge of the unit Date of foundation Register capital Main operation business or management activities Guangdong Highway Construction Co. Ltd. Wang Kangchen April 161987 8827.36846696 million yuan Highway bridge tunnel bridge traffic infrastructure construction investment and management technical consulting leasing of road construction machinery; sales of construction materials construction machinery equipment; vehicle rescue services (operated by the branch). 5.Situation of Share Limitation Reduction of Controlling Shareholders Actual Controllers Restructuring Party and Other Commitment Subjects □Applicable √Not applicable 24.55% 2.53% Guangdong Provincial Expressway Development Co. Ltd Guangdong Highway Construction Co. Ltd. Guangdong Province Transportation Development Co. Ltd 22.30%0.10% Guangdong Province Expressway Co. Ltd. Guangdong Xinyue Co. Ltd. State-owned Assets Supervision and Administration Commission the people’s Government of Guangdong Province Guangdong Communication Group Co. Ltd. 100% 0.63% VII. Situation of the Preferred Shares □Applicable √Not applicable The Company had no preferred shares in the reporting period. VIII Information about convertible corporate bonds □ Applicable √Not applicable During the reporting period the company did not have convertible corporate bonds. 2020 Annual Report IX. Information about Directors Supervisors and Senior Executives I. Change in shares held by directors supervisors and senior executives Name Positions Office status Sex Age Starting date of tenure Expiry date of tenure Shares held at the year-begi n(share) Amount of shares increased at the reporting period(share) Amount of shares decreased at the reporting period(share) Other changes increase /decrease Shares held at the year-begin( share) Zheng Renfa Board Chairman In office Male 51 January 42017 September 202022 Wang Chunhua Director General Manager In office Male 56 October 192015 September 202022 135100 135100 Chen Min Director In office Male 57 July 192017 September 202022 Zeng Zhijun Director In office Male 50 December 42017 September 202022 You Xiaocong Director In office Male 53 July 212020 September 202022 Zhuo Weiheng Director In office Male 49 December 42017 September 202022 Wu Hao Director In office Female 48 Novembe r 22020 September 202022 Huang Hai Director In office Male 45 July 212016 September 202022 Gu Naikang Independent director In office Male 55 July September 2020 Annual Report Name Positions Office status Sex Age Starting date of tenure Expiry date of tenure Shares held at the year-begi n(share) Amount of shares increased at the reporting period(share) Amount of shares decreased at the reporting period(share) Other changes increase /decrease Shares held at the year-begin( share) 212016 202022 Bao Fangzhou Independent director In office Male 42 July 212016 September 202022 Zhang Hua Independent director In office Male 55 December 42017 September 202022 Liu Zhonghua Independent director In office Male 55 December 42017 September 202022 Zeng Xiaoqing Independent director In office Female 51 May 202019 September 202022 Jiang Changwen Chairman of the Supervisory Committee In office Male 53 May 202019 September 202022 Li Haihong Supervisor In office Female 49 July 212016 September 202022 Ke Lin Supervisor In office Female 51 Septembe r 152017 September 202022 Feng Yuan Supervisor In office Male 56 Septembe r 92019 September 202022 Zhou Yisan Supervisor In office Male 40 Septembe r 92019 September 202022 Zuo Jiang Deputy General Manager In office Female 48 October 192015 September 202022 2020 Annual Report Name Positions Office status Sex Age Starting date of tenure Expiry date of tenure Shares held at the year-begi n(share) Amount of shares increased at the reporting period(share) Amount of shares decreased at the reporting period(share) Other changes increase /decrease Shares held at the year-begin( share) Cheng Rui Deputy General Manager In office Male 46 August 282017 September 202022 Lu Ming Chief accountant In office Male 42 December 252020 September 202022 Luo Baoguo Deputy General Manager In office Male 47 December 252020 September 202022 He Bing legal counsel In office Female 53 July 232012 September 202022 Yang Hanming Secretary to the Board In office Male 51 August 282017 September 202022 Wang Ping Director Chief engineer Dimission Female 56 April 212014 January 82020 3500 3500 Du Jun Director Dimission Male 55 July 212016 June 242020 0 10400 10400 Cao Yu Director Dimission Male 35 July 212016 September 42020 150000 150000 Fang Zhi Director Chief accountant Dimission Male 57 December 312015 December 212020 Total -- -- -- -- -- -- 288600 10400 0 0 299000 2020 Annual Report II. Change in shares held by directors supervisors and senior executives √ Applicable □Not applicable Name Positions Types Date Reason Wang Ping Director Chief engineer Dimission January 82020 Retired Du Jun Director Dimission June 242020 Job change Cao Yu Director Dimission September 42020 Job change Fang Zhi Director Chief accountant Dimission December 212020 Job change III.Posts holding Work Experience in the past five years of Directors supervisors and senior Executives in Current office Mr. Zheng Renfa，He served as Chairman Master Degree Senior economic engineer. Since December 2005，He served as Deputy Minister of InvestmentManagement Department of Guangdong Communication Group，Since April 21 2014，He served as director Since August 15 2016 the implementation of theduties of the Board of Directors and the legal representative of the duties. Since January 4 2017 he was the chairman of the board of directors of the Company and hold a concurrent post of evecutive director and Legal representative of Guangdong Yuegaoke Capital Investment (Hengqin) Co. Ltd.Mr. Wang Chunhua He served as Director and General Manager of the Company Master Degree senior engineer and senior economic engineer Since September 2006 he served as Deputy General Manager of the Company.From March 2013 to October 2015 He served as director and Deputy General Manager of the Company Since October 2015 He served as Director and General director of the Company and hold a concurrent post of vice chairman of Shenzhen Huiyan Expressway Co. Ltd.Lu Ming is the director of the Company chief accountant senior accountant with the graduate degreeandMBA. From July 1999 to February 2001 he served as the accountant of Jingzhu Expressway Guangzhu Section Co. Ltd; from February 2001 to November 2003 he served as the accountant of the Zhongjiang Expressway Project Preparation Office and from November 2003 to September 2006 he served as Deputy Manager of the Accounting and Finance Department of the West Ring Section (South Section) of the Pearl River Delta Ring Expressway. From September 2006 to February 2008 he served as the accountant of the Financial Audit Department of Guangdong Provincial Highway Construction Co. Ltd. From February 2008 to March 2009 he successively served as the deputy manager and manager of the Finance Department of the Southern Branch of the West Second Ring Road of Guangdong Provincial Highway Construction Co. Ltd;from March 2009 to December 2020 he served as the manager personnel deputy supervisor of business and business supervisor of the Financial Management Department of Guangdong Provincial Communications Group Co. Ltd. During the period from December 2018 to December 2019 he served as the first secretary of the Party branch of the Yinghuai Management Office of the Longhuai Expressway Management Center of Nanyue Transportation of Guangdong Province. He has been the chief accountant of the Company since December 25 2020 and he has served as the director of the Company since February 3 2021.Mr. Chin Min He serves as Director undergraduate degree senior economist corporate legal adviser cost engineer. From September 2001 to August 2009 He served as Senior economist Director and General Manager of Guangdong Jingtong Highway Engineering Construction Group Co. Ltd.From August 2009 to April 2011 He served as Deputy General Manager of Guangdong Nanyue Logistics Co. Ltd.Form April 2011 to December 2014 He served as Duputy Minister of Legal Affairs of Guangdong Communications Group Co. Ltd. Since December 2014 He served as Minister of Legal Affairs of Guangdong Communications Group Co. Ltd.Since July 19 2017 He served as Director of the Company. Mr. Zeng Zhijun economist is a director of the Company with master degree. Since June 2010 he has served as the deputy chief economist of Guangdong Provincial Expressway Co. Ltd. From January 2015 to September 2015 he served as Minister of Investment Planning Department of Guangdong Provincial Expressway Co. Ltd; since September 2015 he has served as Minister of Legal Affairs Department of Guangdong Provincial Expressway Co.Ltd. ，Since September 2020 He serves as Minister of personnel resource department，Since December 4 2017he serves as Director of the Company.You Xiaocong senior accountantis the director of the Company with bachelor degree. From August 1990 to May 2008 he successively served as the deputy manager and manager of the finance department of Guangfa Transportation Co. Ltd. and the manager director and chief accountant of the finance department of Macau Qi’guan Che’lu Co. Ltd. From May 2008 to January 2015 he served as the assigned chairman of the board of supervisors ofGuangdong Provincial Communications Group Co. Ltd. From January 2015 to May 2015 he served as the director and chief accountant of Guangdong Provincial Highway Construction Co. Ltd. and since May 2015 he has served as the director chief accountant and member of the party committee of Guangdong Provincial Highway Construction Co. Ltd. He has served as director of the Company since November 2 2020. Mr. Zhuo Weiheng is a senior accountant with bachelor degree. From January 2008 to May 2009 he served as the minister of the financial audit department of Guangdong Provincial Highway Construction Co. Ltd. Since May 2009 he has served as the Minister of Finance Management Department of Guangdong Provincial Highway Construction Co. Ltd.From December 4 2017 to February 242021 he served as Director of the Company. Wu Hao (resigned from the director and member of the Audit Committee on December 21) is the director of the Companywith bachelor degree. From September 1992 to October 2011 she successively served as a section member and deputy section chief of the Finance Section of the Administration for Industry and Commerce of Tongzi County Guizhou Province. From October 2011 to February 2012 he served as the section chief of the Finance Section of the Huichuan District Administration for Industry and Commerce Zunyi City Guizhou Province. From April 2013 to May 2020S he successively served as deputy manager of the finance department deputy manager of the investment business department and manager of the investment business department of Shandong Expressway Investment Development Co. Ltd. She has served as the deputy general manager and member of party committee of Shandong Expressway Investment Development Co. Ltdsince May 2020. From November 2 2020 he has served as director of the Company.Mr. Huang Hai MBA joined the work in 1997. He had successively served as the business manager of the financial department of Shenzhen Wofa Medical New Technology Development Co. Ltd. the manager of the marketing department of Shantou Branch of Guangzhou Xingda Communication Co. Ltd the manager of the securities department and securities affairs representative of Zhongshan Public Technology Co. Ltd. andDeputy General Manager of the Securities Department of Poly Real Estate and Director of the Office of the Secretary of the Board of Directorsof Poly Real Estate currently serving as Secretary of the Board and Director of the Office of the Board of Directors of Poly Development Holding Group Co. Ltd. Chairman of Poly Property Development Co. Ltd. Executive Director and General Manager of Tibet Yingyue Investment Management Co. Ltd. Since July 21 2016 he has served as director of the Company.Mr. Bao Fangzhou Independent director of the Company Master of Law. Shanghai Jin Tiancheng Law Firm Senior Partner 2008 - 2014 Former Independent Director of New Nanyang Co. Ltd. Since 2013 he has been an independent director of Hubei Wushi Pharmaceutical Co. Ltd. since June 2016 Power Co. Ltd. Independent Director. From July 21 2016He is an independent director of the Company. Gu Naikang Independent directors and doctorate degree of the Company. Since June 2004 he has been a professor and doctoral tutor of Finance and Investment Department of Zhongshan University School of Management. He is currently an independent director of Guangxi Guitang (Group) Co. Ltd. an independent director of Dongguan Yuqiu Electronics Co. Ltd. and an independent director of Guangzhou Zhujiang Industrial Development Co. Ltd. From July 21 2016 he is an independent director of the Company. Mr. Liu Zhonghua professor of accounting is an independent director of the Company with master degree.In September 2005 he was transferred to the School of Management of Guangdong University of Foreign Studies to teach. He is currently a professor at the School of Accounting of Guangdong University of Foreign Studies he is a master tutor concurrently serves as member of Accounting Society of China executive member of China Association of Foreign Trade and Economic Accounting vice chairman of Guangdong Province Management Accounting Association executive member of Guangdong Provincial Accounting Association and member of Guangdong Audit Society. Since December 4 2017 he is an independent director of the Company.Mr. Zhang Hua economist is an independent director of the Company with Master Degree. From May 2006 to May 2012 he served as deputy general manager and chief investment director of Guangzhou Yingzhi Caihua Investment Co. Ltd. From June 2012 to September 2016 he served as the deputy general manager of Guangzhou De’rui Investment Co. Ltd and concurrently served as Deputy General Manager of Shenzhen Dongying Ruitong Investment Management Partnership (Limited Partnership); since October 2016 he has served as general manager of Shanghai Er Luo Investment Management Service Center (General Partnership). From November 2010 to January 2017 he served as an independent director of Guangzhou Yu Yin Technology Co. Ltd. From December 2011 to September 2017 he served as an independent director of Guangdong Electric Power Development Co. Ltd. In September 2017 he was an independent director of Zhuhai Taichuan Cloud Community Technology Co.Ltd. Since December 4 2017 he is an independent director of the Company.Ms. Zeng Xiaoqing an independent director of the Company with bachelor's master's and doctor's degrees from Tongji University. Since 1993 she conducted training and study at Tsinghua University and German Darmstadt University of Technology. From February 2000 to October 2002 she conducted post-doctoral research and study in Tokyo Institute of Technology Japan. She began to work in Tongji University in 1993 served as assistant director of Shanghai Municipal Government's Expo Science and Technology Promotion Center from 2005 to 2012 and served as vice-chairman and secretary-general of Shanghai Creative Studies Institute from 2012; She is currently the director of Tongji University's Joint Experimental Center for Traffic Information Control professor and doctoral supervisor of Tongji University's School of Transportation Engineering. From May 20 2019 she served as the independent director of the Company. Mr. Jiang Changwen male is 52 years old master of management senior accountant senior economist. From July 1999 to November 2006 he worked in Guangshenzhu Expressway Co. Ltd. and served as the supervisor deputy manager and manager of the accounting department. From November 2006 to January 2009 he worked in the Jiangzhong Expressway Company and served as the finance department manager; since January 2009 he has worked in the Guangdong Provincial Transportation Group Co. Ltd and has served as a supervisor. From May 202019 he is the assigned chairman of the supervisory board of Guangdong Communication Group Co. Ltd. Ms. Li Haihong Supervisors of the Company bachelor degree senior economist and road and bridge engineer.Since October 2008 she has been working as a supervisory and auditing department of the Guangdong Provincial Communications Group. From October 2008 to September 2012 she was appointed full-time supervisor of Guangdong Expressway Co. Ltd. FromOctober 2012 to March 2016 she was appointed full-time supervisor of Guangdong Yueyun Traffic Co. Ltd. and Guangdong Communications Industrial Investment Co. Ltd.Form March 2016 to December 2017 she was appointed full-time supervisor of Guangdong Litong Real Estate Investment Co. Ltd.Since December 2017 she was appointed full-time supervisor of Guangdong Nanyue Traffic Investment Construction Co. Ltd. Since March 2016 she was appointed full-time supervisor of Guangdong Traffic Industry Investment Co. Ltd. from December 2018 to present is the first secretary of the party organization of Guangdong Kaiyang Expressway Co. Ltd. From July 21 2016 she has served as supervisor of the Supervisory Committee of the Company.Ms.Ke Lin bachelor degree Bachelor of Science assistant researcher. She began to take a job in July 1991.She had successively served as cadre of personnel department deputy head head of the personnel department section chief rank cadre of discipline inspection and supervision department director of the commission for discipline Inspection (deputy-director level). In November 2008 she was transferred to work in Provincial Transportation Group successively served as member of party committee union chairman and discipline inspection commission secretary. From January 2013 to August 2017 she has served as party committee member discipline inspection commission secretary and chairman of the union in Yueyun Transportation. .Since September 15 2017 She served as supervisor of Board of supervisor of the Company. Mr. Feng Yuan supervisor of the Company bachelor of science associate professor. From October 2009 to October 2014 he served as deputy general manager of Guangdong Jiangzhong Expressway Co. Ltd. and director and deputy general manager of Jingzhu Expressway Guangzhu Section Co. Ltd. From October 2014 to December 2018 he served as director general manager and deputy secretary of the Party Committee of Guangdong-Foshan Expressway Co. Ltd. and he has been deputy economist of the Company since December 2018. From September 9 2019 he served as the employee supervisor of the 9th Supervisory Committee of the Company. Mr. Zhou Yisan supervisor of the Company postgraduate degree master of law enterprise legal consultant with national legal professional qualification board secretary qualification and securities fund and futures practitioner qualification. From February 2014 to April 2016 he was the deputy supervisor of the Legal Affairs Department of Guangdong Transportation Group Co. Ltd. From April 2016 to September 2017 he was the deputy head of the Investment Development Department and Legal Affairs Department of the Company and he has been the head of Legal Affairs Department of the Company since September 2017. From September 9 2019 he served as the employee supervisor of the 9th Supervisory Committee of the Company.Ms. Zuo Jiang Deputy General Manager of the Company Master of Economics Senior Economist Qualified as Legal Adviser of the Enterprise Secretary of the Board of Directors. He has been working in the Company since 1994. He has been the Minister of Securities Affairs of the Company since 1999. He has been the Secretary of the Board of Directors and Director of Securities Affairs Department since March 2006. From October 2015 to July 2016 he was the Deputy General Manager and Secretary of the Board of Directors And Minister of Securities Affairs. Since October 2015 he has been the Deputy General Manager of the Company and hold a concurrent post of Director of Yueke Technology Petty Loan Co. Ltd. and director of Guoyuan Securities Co.Ltd.Mr. Cheng RuiOn-job postgraduate master of business administration with a lawyer qualification. He began to take a job in July 1997. He had successively served as development department staff deputy manager of investment management department and manager of investment management department in Xinyue Co.Ltd served as Deputy General Manager of Xinyue Company in August 2015 and served as deputy minister of strategic development department from April 2016 to August 2017. Since August 2017 he served as Deputy General Manager of the Company. During this period starting from May 2019 she was assigned as the first secretary of the Party organization in Shanhu Village Jinhe Town Jiexi County Jieyang City.Mr. Luo Baoguo deputy general manager of the Company with graduate degree and master of engineering is senior engineer. From July 1999 to December 2003 he successively served as the chief engineer of the L bid project of the southern section of the Jingzhu Expressway of the Guangdong Provincial Highway Engineering Construction Group Co. Ltd. the deputy manager and technical sponsor of the southern Jingzhu pavement project Deputy Manager and Chief Engineer of the Pavement Project Department of the Jingzhu Southern Fogang Section Manager of the Project Manager Department and Deputy Manager of the Second Branchof the Eighth Contract Section of Henan Jiaozuo-Jincheng Expressway. From December 2003 to March 2007 he successively served as the manager of the university town project the manager of the business contract department and the employee supervisor of the Guangdong Jingtong Highway Engineering Construction Group Co. Ltd. From March 2007 to July 2014 he served as Director of the Project Development Office and Director of the Investment Development Department of Guangdong Expressway Development Co. Ltd. From August 2014 to July 2017 he served as the director general manager and deputy party secretary of Guangdong Fokai Expressway Co. Ltd. From August 2017 to December 2020 he served as the general manager (person in charge) and deputy secretary of the Party Committee of Fokai Branch of Guangdong Expressway Development Co. Ltd. From December 25 2020 he has served as the deputy general manager of the Company. He concurrently serves as the chairman of Zhaoqing Yuezhao Highway Co. Ltd.-the company's share-participating company and serves as the vice chairman of Guangdong Jiangzhong Expressway Co. Ltd.Ms. He Bing general counsel master's degree in law enterprise legal adviser from August 2005 to July 2012 she served as Deputy chief economic engineer of the Company Since July 2012 she served as Chief legal adviser of the Company. and hold a concurrent post of Director of Huiyan Expressway Co. Ltd. and Director of Guanghui Expressway Co. Ltd. Mr. Yang Hanming he has been the Secretary of the Board， bachelor's degree senior economist corporatelegal adviser with the board secretary qualifications. Since March 2000 he has been successively served as deputy minister of investment planning and minister of legal affairs in Guangdong Provincial Expressway Development Co. Ltd. Since August 2014 he has been concurrently served as minister of investment and development. Since August 2017 he has been the Secretary of the Board of the Company vice Chairman of Ganzhou Gankang Expressway Co. Ltd. Director of Guangdong Jiangzhong Expressway Co. ltd. and supervisor of Guangdong Yueke Technology Petty Loan Co. Ltd. Since September 2019 he served as Minister of Development Dept of the Company. Office taking in shareholder companies √Applicable □Not applicable Names of the persons in office Names of the shareholders Titles engaged in the shareholders Sharing date of office term Expiry date of office term Does he /she receive remuneration or allowance from the shareholder Chen Min Guangdong Communication Group Minister of Investment Management Dept. December 12014 Yes You Xiaocong Guangdong Highway Construction Co. Ltd. Director Chief accountant January 142015 Yes Zhuo Weiheng Guangdong Highway Construction Co. Ltd. Deputy Chief Accountant March 262018 Yes Zeng Zhijun Guangdong Expressway Co.Ltd Minister of legal affairs Dept September 12015 Yes Huang Hai Tibet Yinyue Investment Management Co. Ltd. Executive director June 12015 No Jiang Changwen Guangdong Communication Group Co. Ltd. Dispatched chairman of the supervisory committee January 12009 Yes Li Haihong Guangdong Communication Group Co. Ltd. Full-time field supervisors July 212016 Yes Offices taken in other organizations √Applicable □Not applicable Name of the persons in office Name of other organizations Titles engaged in the other organizations Starting date of office term Expiry date of office term Does he/she receive remuneration or allowance from other organization Bao Fangzhou Shanghai Allbright law firm Lawyer Senior partner January 12000 Yes Bao Fangzhou Laurel Power Co. Ltd. Independent director June 12016 Yes Gu Naikang Finance and Investment School of Business Sun YAT-SEN University Professor doctoral supervisor January 12004 Yes Gu Naikang Guangzhou Zhujiang Industry Development Co. Ltd. Independent director May 12014 July 12020 Yes Gu Naikang Mingyang Intelligent Energy Group Co.Ltd.Supervisor July 12017 Yes Gu Naikang Zhubo Design Co. Ltd. Independent director December 12019 Yes Gu Naikang Guangfa Securities Co. Ltd. Supervisor June 12016 June 12020 Yes Zhang Hua Shanghai Erro Investment Management Service Centre(General partnership) General Manager October 12016 Yes Zhang Hua Zhuhai Taichuan Community Technology Co. Ltd . Independent director September 12017 Yes Zhang Hua Guangzhou Yuyin Technology Co. Ltd. Independent director November 12018 Yes Liu Zhonghua College of Accounting Guangdong University of Foreign Studies Professor Master’s supervisor September 1 2005 Yes Liu Zhonghua Gelinmei Co. Ltd. Independent Director March 202019 Yes Liu Zhonghua Guangdong Shaogang Songshan Co. Ltd. Independent Director June 252019 Yes Wu Hao Shandong Expressway Investment Development Co. Ltd. Deputy GM May 292020 Yes Huang Hai Poly Developments and Holdings Group Co. Ltd. Secretary to the Board April 262012 Yes Huang Hai Poly Property Development Co. Ltd. Board chairman April 222019 No Zeng Xiaoqing Tongji University's School of Transportation Engineering Professor and doctoral supervisor June 12007 Yes Zeng Xiaoqing Tongji University's Joint Experimental Center for Traffic Information Control Director June 302003 No Punishments to the current and leaving board directors supervisors and senior managers during the report period by securities regulators in the recent three years □Applicable √Not applicable IV. Remuneration to directors supervisors and senior executives Decision-making procedures basis for determination and actual payment of the remuneration to directors supervisors and senior executives The remuneration of members of the Eighth board of directors and supervisory committee was examined and determined at the second provisional shareholders’ general meeting in 2019The remuneration of the senior executives is determined by the assets operation responsibility system in that year. 1. The directors of the Company and the controlling shareholder of the Company and its related parties as well as the directors of the Company shall not receive the remuneration of the directors. 2. Directors who have not held other positions in the Company and the controlling shareholder of the Company and its related parties are remunerated by the directors of the Company and the standard is RMB 6000 (tax included) per person per month. In addition the expenses incurred by the independent directors at the board of directors and the shareholders' general meeting and the expenses incurred in exercising their functions and powers in accordance with the articles of association may be reimbursed in the company.Remuneration to directors supervisors and senior executives in the reporting period In RMB 10000 Name Positions Sex Age Office status Total remuneration received from the Company Whether to get paid in the company related party Zheng Renfa Board Chairman Male 51 In Office 75.19 No Wang Chunhua Director General Manager Male 56 In office 72.54 No Wang Ping Director Chief Engineer Female 56 Dimission 16.87 No Fang Zhi Director Chief accountant Male 57 Dimission 61.59 No Chen Min Director Male 42 In office 0 No Chen Min Director Male 57 In Office 0 Yes Zeng Zhijun Director Male 50 In Office 0 Yes Du Jun Director Male 55 Dimission 0 Yes You Xiaocong Director Male 53 In Office 0 Yes Zhuo Weiheng Director Male 49 In Office 0 Yes Cao Yu Director Male 35 Dimission 4.8 No Wu Hao Director Female 48 In Office 0 Yes Name Positions Sex Age Office status Total remuneration received from the Company Whether to get paid in the company related party Huang Hai Director Male 45 In Office 1.8 No Gu Naikang Independent director Male 55 In Office 7.2 No Bao Fangzhou Independent director Male 42 In Office 7.2 No Zhang Hua Independent director Male 55 In Office 7.2 No Liu Zhonghua Independent director Male 55 In Office 7.2 No Zeng Xiaoqing Independent director Female 51 In Office 7.2 No Jiang Changwen Chairman of the Supervisory Committee Male 54 In Office 0 Yes Li Haihong Supervisor Female 49 In Office 0 Yes Ke Lin Supervisor Female 51 In Office 62.63 No Feng Yuan Supervisor Male 56 In Office 47.9 No Zhou Yisan Supervisor Male 40 In Office 48.04 No Zuo Jiang Deputy General Manager Female 48 In Office 61.59 No Cheng Rui Deputy General Manager Male 46 In Office 64.59 No Luo Baoguo Deputy General Manager Male 47 In Office 0 No He Bing Chief legal adviser Female 53 In Office 49.3 No Yang Hanming Secretary to the Board Male 51 In Office 51.31 No Total -- -- -- -- 654.15 -- Incentive equity to directors supervisors or/and senior executives in the reporting period □ Applicable √Not applicable V. Particulars about employees. 1.Number of staff professional structure and educational background Number of in-service staff of the parent company(person) 109 Number of in-service staff of the main subsidiaries(person) 2847 The total number of the in-service staff(person) 2956 The total number of staff receiving remuneration in the current period(person) 2949 Retired staff with charges paid by the parent company and main subsidiaries (person) 105 Professional Category Number of persons（person） Operating personnel 2348 Sale personnel 0 Technology Personnel 391 Financial personnel 61 Management personnel 156 Total 2956 Education Category Number of persons（person） Holders of master’s degree or above 54 Graduates of regular university 558 Graduates of junior colleges 1554 Other 790 Total 2956 2. Remuneration policies According to the company's overall development plan to further establish and improve a variety of human resource management system strengthen the macro salary management to maintain the level of salary market competitiveness. Advocate salary and performance related and constantly improve the performance appraisal mechanism personal performance appraisal approach staff promotion system to develop both incentive and restrictive salary performance policy. Think highly of the establishment and perfection of welfare system in accordance with the relevant provisions of the state on time and in full for the full pay pension insurance medical insurance work-related injury insurance unemployment insurance maternity insurance housing provident fund and other statutory benefits comply with the provisions on working hours rest and vacations the establishment of supplementary medical insurance enterprise annuity and welfare system. 3.Training plan None 4.Outsourcing situation □ Applicable √ No Applicable X. Administrative structure I. General situation The Company strictly followed the requirement of laws and regulations in < the Securities Law>< Code of Corporate Governance for Listed Companies in China> etc. and kept on improving corporate governance structures improving normative operation level. Company had stipulated rules such as rules of procedures in three meetings working guide of special committee in board of directors working guide of general manager etc. and internal control system basically covering all operating management such as company financial management investment management information disclosure related transaction external guarantee fund raising etc. All rules are well implemented.In the report period strictly following the relevant provisions of “Company Law”and “Regulations” the shareholder’s meeting of our bank effectively performed the functions. The board of directors is to be responsible for the shareholder’s meeting to take the ultimate responsibility for the bank’s operation and management and to convene a meeting as well as performing the function and power according to legal procedure. In line with the attitude which is responsible for all shareholders and keeping in close contact and communication with the board of directors and the management the board of supervisors carries out the assessment work on duty exercising for the board of directors and the board of supervisors effectively performing functions and obligations of supervision. Does there exist any difference in compliance with the corporate governance the PRC Company Law and the relevant provisions of CSRC □ Yes √No There exist no difference in compliance with the corporate governance the PRC Company Law and the relevant provisions of CSRC.II. Independence and Completeness in business personnel assets organization and finance 1. Independent business The company mainly engaged in business is Guangfo Expressway Fokai Expressway and Jingzhu Expressway Guangzhu section of the charges and maintenance work investment in science and technology industry and provide relevant advice.it has invested in or holds Shenzhen Huiyan Expressway Co. Ltd. Guanghui Expressway Co. Ltd. Jiangzhong Expressway Co. Ltd. Zhaoqing Yuezhao Highway Co. Ltd. Ganzhou Kangda Expressway Co. Ltd Ganzhou Gankang Expressway Co. Ltd.Guangdong Yueke Technology Petty Loan Co. Ltd. Guangdong Guangle Expressway Co. Ltd.Guoyuan Securities Co. Ltd.and Hunan Lianzhi Technology Co. Ltd.The Company has outstanding main operation independent and complete business and the ability of independent operation. All business decisions of the Company were made independently being completely separated from the shareholder with actual control. Related transactions were carried out in light of the principle of fair transaction which did not harm the interests of the Company and other shareholders of the Company. The content of related transactions was fully timely and accurately disclosed which did not have negative influence on the Company. 2. Complete assets The relationship of the Company's property right is clear. The assets injected by shareholders in the Company are independent and complete and have clear property right. All capital was paid up and relevant formalities of property right change were settled. 3. Independent personnel As for personnel relationship the general manager deputy general managers the secretary to the board of directors and financial controller of the Company were full-time employees and received salary from the Company who did not concurrently hold positions at the parent company. All directors and supervisors of the Company were elected through legal procedure. The general manager deputy general managers chief accountant chief economic engineer and chief engineer were directly appointed by the board of directors. Other managerial personnel of all levels were directly appointed by the general manager.The Company owns independent power of personnel appointment and removal. 4. Independent finance The Company including subsidiaries established independent accounting department，independent accountingsystem and regulations on financial management.The Company independently opened bank account and did not deposit funds in the accounts of the finance company or settlement center of the majority shareholder. The Company independently paid tax. The Company's financial decisions were independently made. The majority shareholder did not interfere with the use of funds by listed companies. 5. Independent organization The board of directors the supervisory committee and other internal organs of the Company operated independently. Its organs are complete and independent.III. Horizontal Competitions □Applicable √ Not applicable IV. Annual General Meeting and Extraordinary Shareholders’ Meetings in the Reporting Period 1.Annual General Meeting Sessions Meeting Date Description of proposals Resolution Disclosure date Disclosure index 2019 Shareholders’ general meeting Annual Shareholders’ General Meeting 67.90% June 292020 June 302020 Announcement of Resolutions of the shareholders' general meeting in 2019.www.cninfo.com.cn The First provisional shareholders’ General meeting of 2020 Provisional shareholders’ General meeting 61.46% November 22020 November 32020 Announcement of Resolutions of the First provisional shareholders' general meeting of 2020. www.cninfo.com.cn The Second provisional shareholders’ Provisional shareholders’ General 63.68% November 252020 November 262020 Announcement of Resolutions of the Second provisional shareholders' general meeting General meeting of 2020 meeting of 2020. www.cninfo.com.cn The Third provisional shareholders’ General meeting of 2020 Provisional shareholders’ General meeting 70.97% December 152020 December 162020 Announcement of Resolutions of the Third provisional shareholders' general meeting of 2020. www.cninfo.com.cn 2. Request for extraordinary general meeting by preferred stockholders whose voting rights restore □Applicable √Not applicable V. Responsibility performance of independent directors in report period 1. The attending of independent directors to board meetings and shareholders’ general meeting The attending of independent directors Independent Directors Number of Board meetings necessary to be attended in the reporting period Number of spot attendances Number of meetings attended by Communicat ion Number of attendances by representativ e Number of absence Failure to personally attend board meetings successively twice (Yes/No) Attendance of the shareholders' general meeting Gao Fangzhou 11 0 11 0 0 No 4 Gu Naikang 11 0 11 0 0 No 4 Liu Zhonghua 11 0 11 0 0 No 4 Zhang Hua 11 0 11 0 0 No 4 Zeng Xiaoqing 11 0 11 0 0 No 4 Notes to failure to personally attend Board Meetings Successively Twice None 2. Objection for relevant events from independent directors Independent directors come up with objection about Company’s relevant matters □Yes √No No objections arising from the independent directors on relevant events of the Company during the Period 3. Other notes to duty performance of independent directors Has an independent director’s advice to the Company been accepted √Yes □No Explanation on acceptance of or failure to accept an independent director’s advice to the Company. Independent directors seriously exercise the rights conferred by law keep abreast of the company's production and management information concerned about the company's comprehensive development actively attend relevant meetings held by the company in 2020 published an independent and objective advice on relevant matters for consideration by the Board of Directors of the Company. Faithfully perform their duties give full play to the independent role of the independent directors to safeguard the interests of the company as a whole and to safeguard the legitimate rights and interests of all shareholders especially minority shareholders. The advices on business development and corporate governance given by independent directors can be adopted.VI. Duty Performance of Special Committees under the Board of Directors in the Reporting Period 1. The board of directors has an audit committee composed of three directors. i.e. Mr. Liu Zhonghua Mr.Zhang Hua and Mr.Fang Zhi（Resigned as Director and Board of Auditors on 21 December）. The particulars of the work of the audit committee in the report period are as follows: According to the Rules of Procedure of Audit Committee of the Board of Directors and Working Regulations of Audit Committee of the Board of Directors on Annual Report and the work requirements of CSRC and Shenzhen Stock Exchange on annual report for 2019 the audit committee carried out a series of work for the annual audit of the Company for 2019 including deciding the working schedule for the audit of financial report for the report year after consultation with the certified public accountants in charge reviewing the financial report prepared by the Company and forming written opinions issuing the Urging Letter for Audit to certified public accountants and requiring certified public accountants to carry out overall work plan for audit and submit relevant progress report to the audit committee reviewing the financial report for 2019 submitted by the Finance Dept. of the Company (on which the certified public accountants in charge of annual audit issued standard unqualified opinions) and giving written auditing opinions. 2. The board of directors has a remuneration committee composed of three directors i.e. Mr. Bao Fangzhou Mr. Gu Naikang and Mr Huang Hai. The particulars of the work of the remuneration committee in the report period are as follows: According to the Company's Regulations on Performance Appraisal and Remuneration Management of Senior Executives the remuneration and appraisal committee audited the remuneration disclosed by the Company's directors supervisors and senior executives for 2018 and expressed auditing opinions and examined and adopted the remuneration scheme and appraisal scheme for senior executives of the Company for 2019. 3.In the report period The board of directors has an strategy committee composed of five directors. i.e. Mr. Zheng Renfa Mr.Wang Chunhua Mr.Bao Fangzhou Mr.Zhang Hua and Ms.Zeng Xiaoqing.Strategy Committee will strengthen the company's strategic direction strategic planning research and supervise the implementation of corporate strategies provide timely advice to the Board decisions on strategic development. 4.The board of directors has set up a Risk Management Committee composed of three directors including chairman Mr. Zheng Renfa members Mr. Gu Naikang and Mr. Bao Fangzhou.The Risk Management Committee will work in accordance with the Company's Measures for the Management of Risk Management and Internal Control and the Rules of Procedure of the Risk Management Committee of the Board of Directors. The results of the Company's annual risk assessment were reviewed and approved. 2020 Annual Report VII. Work of the supervisory Committee Did the supervisory Committee find any risk existing in performing the supervision activities in the reporting period □Yes √No The supervisory Committee has no objection against any matters under supervision in the reporting period VIII. Assessment and incentive Mechanism for Senior executives The Company implemented position responsibility to every senior management and made clear regulations on job standards appraisal standards. The senior management staff shall report to worker representatives and accept comments.IX. Internal Control I. Specific situations on major defects of internal control discovered during report period □ Yes √ No II. Self-evaluation report on internal control Disclosure date of appraisal report on internal control March 26 2021 Disclosure index of appraisal report on internal control www.cninfo.com.cn The ratio of the total assets of units included in the scope of evaluation accounting for the total assets on the company's consolidated financial statements 87.40% The ratio of the operating income of units included in the scope of evaluation accounting for the 57.36% 2020 Annual Report operating income on the company's consolidated financial statements Standards of Defects Evaluation Type Financial Report Non-financial Report Qualitative standard The qualitative criteria for the evaluation of internal control deficiencies in financial reports confirmed by the Company is as follows: The followingsituations (including but not limited to) shall be deemed as “materialdeficiencies” in the internal control of the financial report. (1) There are major frauds made by the directors or supervisors or senior management personnel in the company’s management activities; (2)There are material misstatements in the current financial report but the internal control failed to find the misstatements during its operation; (3) The supervisions made by the company's audit committee and the internal audit organization on the internal control are invalid; (4) The control environment is invalid; (5)The material deficiencies found and reported to the management but are not corrected within a reasonable time; (6)There is an administrative punishment from the securities regulatory institution due to accounting errors.The following situations (including but not limited to) shall be deemed as “significant deficiencies” in the internal control of the financial report andthere are intense signs for the situations becoming “materialdeficiencies”: (1) Frauds made by staff in key positions; (2)The supervisory function on compliance is invalid and the violations of regulations may have a significant impact on the reliability of the financial report; (3)The significant deficiencies reported to the management but are not corrected within a reasonable period.The following situations (including but not limited to) shall be deemed as The qualitative criteria for the evaluation of internal control deficiencies in non-financial reports confirmed by the Company is as follows: Material deficiencies: serious violations and being sentenced to heavy fines or need taking criminal responsibility; utterly disregard the rules of law illegal behaviors in the operation and management are particularly severe and the circumstance is very bad which leads to the suspension or cessation to the company's daily operation and management activities and leads to the audit report with a disclaimer of opinion or a negative opinion issued by the CPA; the negative news spread all over the country which caused severe damage to the company’s reputation; resulted in decease of a number of workers or citizens or resulted in damages that are unable to recover to workers or citizens; reached the circumstance(grade II) of major environmental event. Significant deficiencies: illegal and being punished; disregard the requirements of the company’s management system and the relevant rules of law there are illegal acts of using the authority to seek illegal interests in the work which significantly affect the efficiency and the result of daily operation and management activities and lead to the audit report with qualified opinion issued by the CPA; the negative news spread in a region which caused the large-extent damage to the company’s reputation; resulted in decease of a worker or a citizen or resulted in damages that need long time to recover to workers or citizens; reached the circumstance(grade Ⅲ) of big environmental event. General deficiencies: minor violations; the awareness of management under in compliance with laws and regulations is weak lacking of business and 2020 Annual Report “general deficiencies” in the internal control of the financial report. (1) Frauds made by staff in non key positions or business operators execute the implementation procedures not strictly conforming to the company’s policy but resulted in no significant impact on the reliability of the financial report. (2)The supervisory function on compliance is invalid and the violations of regulations may not have a significant impact on the reliability of the financial report; (3)The general deficiencies reported to the management but are not corrected within a reasonable period.management knowledge and there are phenomena such as being slack in performing management duties being passive and poorly execute the institution in the work which shall affect the efficiency and the result of daily operation and management activities and lead to small effects to the company’s management goal; the negative news spread within the company which caused the little-extent damage to the company’s reputation; shortly affected the health of the workers or citizens and the workers or citizens can be recovered in a short time; reached the circumstance(grade Ⅳ) of general environmental event.Standards of Quantization The qualitative criteria for the evaluation of internal control deficiencies in financial reports confirmed by the Company is as follows: Material deficiencies: potential misstatement≧1% of the total amount of the owner’s equity or RMB 200 million; significant deficiencies: 0.5% of the total amount of the owner’s equity or RMB 100 million≤potential misstatement＜1% of the total amount of the owner’s equity or RMB 200 million; general deficiencies: potential misstatement＜0.5% of the total amount of the owner’s equity or RMB 100 million Standards of Quantization The qualitative criteria for the evaluation of internal control deficiencies in financial reports confirmed by the Company is as follows: Material deficiencies: potential misstatement≧1% of the total amount of the owner’s equity or RMB 200 million; significant deficiencies: 0.5% of the total amount of the owner’s equity or RMB 100 million≤potential misstatement＜1% of the total amount of the owner’s equity or RMB 200 million; general deficiencies: potential misstatement＜0.5% of the total amount of the owner’s equity or RMB 100 million Standards of Quantization Number of major defects in financial reporting（a） 0 Number of major defects in non financial reporting (a) 0 Number of important defects in financial reporting（a） 0 Number of important defects in non financial reporting（a） 0 X. Internal Control audit report √ Applicable □Not applicable Review opinions in the internal control audit report In our opinion Guangdong Expressway has maintained effective financial report internal control in all material aspects according to the basic standards for Enterprise internal control and relevant regulations ended December 31 2020. Disclosure of internal audit report Disclosure Disclosure date of audit report of internal control (full-text) March 26 2021 Disclosure index of audit report of internal control (full-text) www.cninfo.com.cn Internal audit report’s opinion Unqualified audit opinion Non-financial reporting the existence of significant deficiencies No Has the CPAs issued a qualified auditor’s report of internal control .□ Yes √No Does the internal control audit report issued by the CPAs agree with the self-assessment report of the Board of Directors √Yes □No XI. Corporation bonds Whether or not the Company public offering corporation bonds in stock exchange which undue or without payment in full at maturity on the approval date for annual report disclosed XII. Financial Report I. Audit report Type of audit opinion Standard Unqualified audit opinion Date of signature of audit report March 25，2021 Name of audit firm Yong Tuo Certified Public Accountants (special general partnership) Auditors’ Report To all shareholders of Guangdong Provincial Expressway Development Co. Ltd.I. Opinion We have audited the financial statements of Guangdong Provincial Expressway Development Co. Ltd.(hereinafter referred to as "the Company") which comprise the balance sheet as at December 31 2020 and the income statement the statement of cash flows and the statement of changes in owners' equity for the year then ended and notes to the financial statements.In our opinion the attached financial statements are prepared in all material respects in accordance with Accounting Standards for Business Enterprises and present fairly the financial position of the Company as at December 31 2020 and its operating results and cash flows for the year then ended. II. Basis for Our Opinion We conducted our audit in accordance with the Auditing Standards for Certified Public Accountants in China. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of our report. According to the Code of Ethics for Chinese CPA we are independent of the Company in accordance with the Code of Ethics for Chinese CPA and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.III. Key Audit Matters Key audit matters are those matters that in our professional judgment were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole and in forming our opinion thereon and we do not provide a separate opinion on these matters. We have identified the following items as key audit items that need to be communicated in the audit report.(I) Depreciation of fixed assets 1. Item description As mentioned in "This Section V.17 Fixed Assets" and "This Section VII.12 Fixed Assets" the book value of the Guangdong Expressway at the end of 2020 was RMB10626919377.93 accounting for 53.81% of the consolidated total assets; the depreciation provided for the toll road in 2020 was RMB1030814662.76 accounting for 62.01% of the consolidated operating costs. Guangdong Expressway toll roads are depreciated according to the traffic flow method which calculates depreciation for the current period based on the ratio of the actual traffic flow to the expected total remaining traffic flow during the operating period. Total traffic volume over the operating period is the forecast of total traffic volume over the operating period of GDHC and is a significant accounting estimate. Therefore we determine the pricing and depreciation of toll roads of Guangdong Expressway Company as the key audit items. In 2019 Guangdong Expressway hired professional organizations to re-measure the total traffic flow during the operation period of Fokai Expressway and Guangzhu Section of Jingzhu Expressway and from January 1 2020 and accrue the depreciation of road property according to the re-measured total traffic flowmeter which is an important change in accounting estimation.Therefore we determined the accuracy of depreciation of highways and bridges and the pricing of highways and bridges of Guangdong Expressway Company as key audit items. 2. Audit response In response to the above key audit matter we have implemented the following main audit procedures: (1)Understand evaluate and test the internal control of the management of the Company on the daily management and accounting treatment of toll roads; (2)Check whether the actual traffic flow data applied by Guangdong Expressway Company in the depreciation calculation of toll roads is consistent with the actual traffic flow data obtained by Guangdong Expressway Company from external service units; (3)Evaluate the independence and professional competence of the third-party organization employed by the Company that carries out traffic flow forecast; (4) Understand the methods used in traffic flow forecast reports issued by third-party organizations to forecast the traffic flow in the future and evaluate the reliability of traffic flow forecast reports by comparing the predicted traffic flow for the past year with the actual traffic flow for that period; (5) Recalculate the depreciation of roads and bridges to verify the accuracy of the depreciation amount of roads and bridges in the financial statements.(II) Investment equityItem description As described in "This Section VII-9 Long-term equity investments" “This Section VII-10Investments in other equity instruments" and "This Section VII-42 Investment income" the total year-end equity investments of Guangdong Expressway in 2020 amounted to RMB4119396693.89 of which RMB2382381165.60 in long-term equity investments and RMB1737015528.29 in other equity instruments accounted for 20.86% of the total consolidated assets of which RMB165302997.18 in total investment income from equity investments in 2020 accounted for 12.12% of the consolidated net profit in 2020. Equity investments have a significant impact on the 2020 financial statements.Therefore we have determined the recognition and measurement of equity investment of Guangdong Expressway Company as the key audit matter. 2. Audit response In response to the above key audit matter we have implemented the following main audit procedures: (1) Obtain investment agreement articles of association and other documents of equity investment and understand the purpose business model and cash flow characteristics of investment contract of Guangdong Expressway Company; (2)Through examination of relevant documents and records understand the joint control or major impact of Guangdong Expressway Company on the joint venture company including appointing representatives to the board of directors of the joint venture company to participate in the formulation of financial and operating policies; (3) Communicate and discuss with the management of Guangdong Expressway Company to evaluate the actual impact of Guangdong Expressway Company on the major decisions of the joint venture company and related operations and to evaluate whether there has been any significant change compared with the previous year; (4) Check the audit report of the important joint venture and associate company and implement on-site audit procedures for the important financial statement items of the important joint venture and associate company that have influence on the equity method accounting of Guangdong Expressway Company; implement review procedures for the financial statements of other joint venture and associate company; (5) Pay attention to whether there are differences between the accounting policies of joint venture and affiliated company and Guangdong Expressway Company and check whether the accounting policies of equity method of Guangdong Expressway Company have been adjusted; (6) Recalculate the accuracy of equity measurement; (III)Merger and reorganization 1. Item description Guangdong Expressway paid cash consideration to Guangdong Provincial Expressway Co. Ltd. controlled by the same group to acquired 21% equity of Guangdong Guanghui Expressway Co. Ltd. so as to achieve control over it. This reorganization resulted in a change in the scope of consolidation and adjustment in the related items in the comparative statements according to the Accounting Standards for Business Enterprises which had a significant impact on the financial statements of Guangdong Expressway.Therefore we identified the merger and reorganization of Guangdong Expressway as a key audit item. 2. Audit response In response to the above key audit matter we have implemented the following main audit procedures: (1) Obtain resolutions of shareholders' meeting board of directors and announcements related to restructuring transactions and relevant important internal approval documents of the Company; (2) Check the equity purchase agreement the approval documents of relevant departments the transfer of equity the amendments to the articles of association of the investee etc. and review the management's judgment on whether the equity is under control; (3) Obtain and review the financial statements and accounting treatment of the acquired company on the merger day; (4) Evaluate whether the disclosure of the reorganization matters in the financial statements meets the disclosure requirements of major asset reorganization matters.(IV) Compensation for loss during epidemic prevention and control 1. Item description As stated in "This Section V-20 Intangible Assets" and "This Section VII-14 Intangible Assets" according to the relevant government documents Guangdong Expressway included the relevant operating expenses incurred during the epidemic prevention and control period from February 17 2020 to May 5 2020 into the book value of intangible assets-toll road franchise and began to amortize the newly added intangible assets-toll road franchise in May 2020 according to the traffic flow method during the remaining operation period. The total impact on the consolidated net profit in 2020 is RMB 221195846.78 accounting for 16.21% of the consolidated net profit in 2020. This accounting treatment has a great impact on the financial statements in 2020. Therefore we identified the loss compensation treatment during the epidemic prevention and control period of Guangdong Expressway as a key audit item. 2. Audit response (1) Obtain and check government documents related to compensation for epidemic prevention and control losses and understand the policy of compensation for epidemic prevention and control losses; (2) Understand the scope of the collection of epidemic losses and check the entry basis of contracts and invoices related to losses during epidemic prevention and control to assess their authenticity and accuracy; (3) Audit the accounting treatment of compensation for loss due to epidemic prevention and control and check whether the accounting treatment meets the requirements of accounting standards for business enterprises.IV.Other Matter The consolidated and company balance sheet on December 31 2019 the consolidated and company income statement the consolidated and company cash flow statement the consolidated and company shareholders' equity statement and the notes to the relevant financial statements were audited by other accounting firms and an unqualified opinion was issued on April 3 2020.V. Other information The management of Guangdong Expressway Company is responsible for other information. Other information includes the information covered in the 2020 annual report of Guangdong Expressway Company but does not include the financial statement and our audit report.Our audit opinion on the financial statements does not cover other information and we do not issue any form of verification conclusion on other information.In combination with our audit of the financial statements our responsibility is to read other information and consider in such process whether other information is materially inconsistent with the financial statements or the information we learned during the audit or whether there appears to be a material misstatement. Based on the work that we have already performed if we determine that other information contains material misstatements we should report such fact. In this regard we have nothing to report.VI. Responsibilities of Management and Those Charged with Governance for the Financial Statements The Company's management is responsible for preparing the financial statements in accordance with the requirements of Accounting Standards for Business Enterprises to achieve a fair presentation and for designing implementing and maintaining internal control that is necessary to ensure that the financial statements are free from material misstatements whether due to frauds or errors.In preparing the financial statements management of the Company is responsible for assessing the Company's ability to continue as a going concern disclosing matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations or has no realistic alternative but to do so.Those charged with governance are responsible for overseeing the Company's financial reporting process.VII. Auditor's Responsibilities for the Audit of the Financial Statements 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 the audit standards will always detect a material misstatement when it exists. Misstatements can arise from 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 ISAs we exercise professional judgment and maintain professional scepticism throughout the audit. We also: (1) 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 omissions misrepresentations or the override of internal control. (2) Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. (3) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management of the Company. (4) Conclude on the appropriateness of using the going concern assumption by the management of the Company and conclude based on the audit evidence obtained whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company'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 future events or conditions may cause the Company to cease to continue as a going concern. (5) Evaluate the overall presentation structure and content of the financial statements including the disclosures and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. (6) Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Company to express an opinion on the financial statements and bear all liability for the opinion.We communicate with those charged with governance regarding among other matters the planned scope and timing of the audit and significant audit matters including any significant deficiencies in internal control that we identify during our audit.We also provide those charged with governance 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 those charged with governance 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.Yong Tuo Certified Public Accountants Co. Ltd.(Special General Partnership) Certified Public Accountant of China: Li Junjie (project partner) Certified Public Accountant of China: Shi Shaoyu Beijing China March 25 2021 II. Financial statements Currency unit for the statements in the notes to these financial statements: RMB 1. Consolidated balance sheet Prepared by: Guangdong Provincial Expressway Development Co. Ltd. December 312020 In RMB Items December 312020 December 312019 Current asset： Monetary fund 2847398003.89 3054198364.15 Settlement provision Outgoing call loan Transactional financial assets Derivative financial assets Notes receivable Account receivable 168907517.56 177099124.09 Financing of receivables Prepayments 3607538.01 11829452.88 Insurance receivable Reinsurance receivable Provisions of Reinsurance contracts receivable Other account receivable 60925367.64 30103478.60 Including：Interest receivable Dividend receivable 2705472.90 7205472.90 Repurchasing of financial assets Inventories 53761.06 111683.22 Contract assets 5452813.90 Assets held for sales Non-current asset due within 1 year 51745.32 51745.32 Other current asset 27051.69 196576603.21 Total of current assets 3086423799.07 3469970451.47 Items December 312020 December 312019 Non-current assets： Loans and payment on other’s behalf disbursed Creditor's right investment Other investment on bonds Long-term receivable Long term share equity investment 2382381165.60 2207266324.84 Other equity instruments investment 1737015528.29 1835822604.77 Other non-current financial assets Property investment 3110381.89 3331500.37 Fixed assets 11540075929.69 12460188469.66 Construction in progress 340611095.47 241274698.97 Production physical assets Oil & gas assets Use right assets Intangible assets 302381356.52 8762039.52 Development expenses Goodwill Long-germ expenses to be amortized 3462122.00 3919764.44 Deferred income tax asset 330755418.39 385494106.13 Other non-current asset 22361861.19 50909325.73 Total of non-current assets 16662154859.04 17196968834.43 Total of assets 19748578658.11 20666939285.90 Current liabilities Short-term loans 200192500.00 Loan from Central Bank Borrowing funds Transactional financial liabilities Derivative financial liabilities Notes payable Account payable 369773342.71 368307598.41 Advance receipts 11309007.41 15605094.69 Items December 312020 December 312019 Contract liabilities 309734.51 Selling of repurchased financial assets Deposit taking and interbank deposit Entrusted trading of securities Entrusted selling of securities Employees’ wage payable 16726198.13 15173142.46 Tax payable 217748392.78 175201627.19 Other account payable 1512619359.78 474689554.26 Including：Interest payable Dividend payable 22262804.39 20020119.31 Fees and commissions payable Reinsurance fee payable Liabilities held for sales Non-current liability due within 1 year 266328017.47 796246790.61 Other current liability 648581.64 1246636.74 Total of current liability 2595655134.43 1846470444.36 Non-current liabilities： Reserve fund for insurance contracts Long-term loan 4977438800.00 4926015000.00 Bond payable 1426488336.65 678124972.89 Including：preferred stock Sustainable debt Lease liability Long-term payable 40406172.37 39369379.91 Long-term remuneration payable to staff Expected liabilities Deferred income 89170569.64 51000000.00 Deferred income tax liability 387103060.74 428922140.08 Other non-current liabilities Total non-current liabilities 6920606939.40 6123431492.88 Total of liability 9516262073.83 7969901937.24 Items December 312020 December 312019 Owners’ equity Share capital 2090806126.00 2090806126.00 Other equity instruments Including：preferred stock Sustainable debt Capital reserves 645969210.48 3094017129.31 Less：Shares in stock Other comprehensive income 302895877.65 382193344.90 Special reserve Surplus reserves 1167785965.63 1074553052.81 Common risk provision Retained profit 3725679319.35 3915790810.76 Total of owner’s equity belong to the parent company 7933136499.11 10557360463.78 Minority shareholders’ equity 2299180085.17 2139676884.88 Total of owners’ equity 10232316584.28 12697037348.66 Total of liabilities and owners’ equity 19748578658.11 20666939285.90 Legal Representative: Zheng Renfa General Manager: Wang Chunhua Person in charge of accounting：Lu Ming Accounting Dept Leader: Zhou Fang 2.Parent Company Balance Sheet In RMB Items December 312020 December 312019 Current asset： Monetary fund 1781764519.09 2791384501.78 Transactional financial assets Derivative financial assets Notes receivable Account receivable 27004827.41 21864051.27 Financing of receivables Prepayments 2181215.03 1737598.88 Other account receivable 54148114.53 13435651.19 Including：Interest receivable Dividend receivable 2705472.90 7205472.90 Inventories Contract assets Assets held for sales Non-current asset due within 1 year 256279340.60 151637139.08 Other current asset 27051.69 Total of current assets 2121405068.35 2980058942.20 Non-current assets： Debt investment 287903684.98 537903684.98 Other investment on bonds Long-term receivable Long term share equity investment 5529362536.53 4789404907.17 Other equity instruments investment 1737015528.29 1835822604.77 Other non-current financial assets Property investment 2858243.64 3079362.12 Fixed assets 6245462940.39 6818701482.08 Construction in progress 43086545.58 46952925.08 Production physical assets Oil & gas assets Use right assets Intangible assets 150582241.22 2533878.12 Items December 312020 December 312019 Development expenses Goodwill Long-germ expenses to be amortized Deferred income tax asset 322365911.10 385296935.33 Other non-current asset 7089990.48 36901029.57 Total of non-current assets 14325727622.21 14456596809.22 Total of assets 16447132690.56 17436655751.42 Current liabilities Short-term loans 200192500.00 Transactional financial liabilities Derivative financial liabilities Notes payable Account payable 105919984.52 129930285.56 Advance receipts Contract Liabilities Employees’ wage payable 6472802.81 6340740.61 Tax payable 9165801.86 8704510.83 Other account payable 1431814861.38 582131356.01 Including：Interest payable Dividend payable 22262804.39 20020119.31 Liabilities held for sales Non-current liability due within 1 year 190331701.48 744589133.72 Other current liability 539618124.00 821133339.57 Total of current liability 2483515776.05 2292829366.30 Non-current liabilities： Long-term loan 4389653800.00 4243730000.00 Bond payable 1426488336.65 678124972.89 Including：preferred stock Sustainable debt Lease liability Long-term payable 40406172.37 39369379.91 Long-term remuneration payable to staff Items December 312020 December 312019 Expected liabilities Deferred income 13403327.12 Deferred income tax liability 105636866.50 129978356.56 Other non-current liabilities Total non-current liabilities 5975588502.64 5091202709.36 Total of liability 8459104278.69 7384032075.66 Owners’ equity Share capital 2090806126.00 2090806126.00 Other equity instruments Including：preferred stock Sustainable debt Capital reserves 938969546.79 2974458696.93 Less：Shares in stock Other comprehensive income 302895877.65 382193344.90 Special reserve Surplus reserves 987813698.07 894580785.25 Retained profit 3667543163.36 3710584722.68 Total of owners’ equity 7988028411.87 10052623675.76 Total of liabilities and owners’ equity 16447132690.56 17436655751.42 3.Consolidated Income statement In RMB Items Year 2020 Year 2019 I. Income from the key business 3790348876.26 4999016766.74 Incl：Business income 3790348876.26 4999016766.74 Interest income Insurance fee earned Fee and commission received II. Total business cost 2106157423.78 2392975172.99 Incl：Business cost 1662223696.13 1924477933.90 Interest expense Fee and commission paid Items Year 2020 Year 2019 Insurance discharge payment Net claim amount paid Net amount of withdrawal of insurance contract reserve Insurance policy dividend paid Reinsurance expenses Business tax and surcharge 23401929.49 25405367.63 Sales expense Administrative expense 203945119.58 218914654.80 R & D costs 404303.70 Financial expenses 216182374.88 224177216.66 Including：Interest expense 264407174.38 257098768.09 Interest income 50618519.70 39377414.30 Add: Other income 12819409.84 1740540.05 Investment gain（“-”for loss） 171366835.55 214765043.56 Incl: investment gains from affiliates 114517784.14 168708231.04 Financial assets measured at amortized cost cease to be recognized as income Gains from currency exchange Net exposure hedging income Changing income of fair value Credit impairment loss -2457808.51 -188983.92 Impairment loss of assets -1231918.94 -7238195.84 Assets disposal income 19031900.46 III. Operational profit（“-”for loss） 1864687970.42 2834151898.06 Add ：Non-operational income 11749841.36 8832100.71 Less: Non-operating expense 20642932.77 17755553.62 IV. Total profit(“-”for loss) 1855794879.01 2825228445.15 Less：Income tax expenses 491409872.94 673785022.80 V. Net profit 1364385006.07 2151443422.35 (I) Classification by business continuity 1.Net continuing operating profit 1364385006.07 2151443422.35 2.Termination of operating net profit (II) Classification by ownership Items Year 2020 Year 2019 1.Net profit attributable to the owners of parent company 867842774.78 1469187067.83 2.Minority shareholders’ equity 496542231.29 682256354.52 VI. Net after-tax of other comprehensive income -79297467.25 126887291.61 Net of profit of other comprehensive income attributable to own ers of the parent company. -79297467.25 126887291.61 （I）Other comprehensive income items that will not be reclassified into gains/losses in the subsequent accounting period -74105307.36 125273257.68 1.Re-measurement of defined benefit plans of changes in net de bt or net assets 2.Other comprehensive income under the equity method investe e can not be reclassified into profit or loss. 3. Changes in the fair value of investments in other equity instruments -74105307.36 125273257.68 4. Changes in the fair value of the company’s credit risks 5.Other（II） Other comprehensive income that will be reclassified into profit or loss. -5192159.89 1614033.93 1.Other comprehensive income under the equity method investe e can be reclassified into profit or loss. -5192159.89 1614033.93 2. Changes in the fair value of investments in other debt obligations 3. Other comprehensive income arising from the reclassification of financial assets 4.Allowance for credit impairments in investments in other debt obligations 5. Reserve for cash flow hedges 6.Translation differences in currency financial statements 7.Other Net of profit of other comprehensive income attributable to Min ority shareholders’ equity VII. Total comprehensive income 1285087538.82 2278330713.96 Total comprehensive income attributable to the owner of the parent company 788545307.53 1596074359.44 Items Year 2020 Year 2019 Total comprehensive income attributable minority shareholders 496542231.29 682256354.52 VIII. Earnings per share （I）Basic earnings per share 0.4151 0.7027 (II)Diluted earnings per share 0.4151 0.7027 The current business combination under common control the net profits of the combined party before achieved ne t profit of RMB 0.00 last period the combined party realized RMB0.00.Legal Representative: Zheng Renfa General Manager: Wang Chunhua Person in charge of accounting：Lu Ming Accounting Dept Leader: Zhou Fang 4. Income statement of the Parent Company In RMB Items Year 2020 Year 2019 I. Income from the key business 975440382.58 1290289841.76 Incl：Business cost 655670622.07 783821932.19 Business tax and surcharge 8077542.21 7618743.78 Sales expense Administrative expense 111210597.86 118364771.13 R & D expense Financial expenses 208439841.94 198989995.09 Including：Interest expenses 250230473.17 224948208.12 Interest income 40734373.10 28519844.52 Add：Other income 3249141.80 483367.72 Investment gain（“-”for loss） 1009976324.53 1236812045.82 Including: investment gains from affiliates 343597391.91 469503736.12 Financial assets measured at amortized cost cease to be recognized as income Net exposure hedging income Changing income of fair value Credit impairment loss -93582.00 Impairment loss of assets -7238195.84 Assets disposal income 276051.47 II. Operational profit（“-”for loss） 1005173662.83 1411827668.74 Add ：Non-operational income 3221547.75 1856765.81 Less：Non -operational expenses 12774779.05 1427763.63 III. Total profit(“-”for loss) 995620431.53 1412256670.92 Less：Income tax expenses 63291303.29 62031595.44 IV. Net profit 932329128.24 1350225075.48 1.Net continuing operating profit 932329128.24 1350225075.48 2.Termination of operating net profit V. Net after-tax of other comprehensive income -79297467.25 126887291.61 （I）Other comprehensive income items that will not be reclassified into gains/losses in the subsequent accounting period -74105307.36 125273257.68 Items Year 2020 Year 2019 1.Re-measurement of defined benefit plans of changes in net debt or net assets 2.Other comprehensive income under the equity method i nvestee can not be reclassified into profit or loss. 3. Changes in the fair value of investments in other equity instruments -74105307.36 125273257.68 4. Changes in the fair value of the company’s credit risks 5.Other (II)Other comprehensive income that will be reclassified i nto profit or loss -5192159.89 1614033.93 1.Other comprehensive income under the equity method i nvestee can be reclassified into profit or loss. -5192159.89 1614033.93 2. Changes in the fair value of investments in other debt obligations 3. Other comprehensive income arising from the reclassification of financial assets 4.Allowance for credit impairments in investments in other debt obligations 5. Reserve for cash flow hedges 6.Translation differences in currency financial statements 7.Other VI. Total comprehensive income 853031660.99 1477112367.09 VII. Earnings per share （I）Basic earnings per share (II)Diluted earnings per share 5. Consolidated Cash flow statement In RMB Items Year 2020 Year 2019 I.Cash flows from operating activities Cash received from sales of goods or rending of services 3866637428.50 5063829880.79 Net increase of customer deposits and capital kept for brother company Items Year 2020 Year 2019 Net increase of loans from central bank Net increase of inter-bank loans from other financial bodies Cash received against original insurance contract Net cash received from reinsurance business Net increase of client deposit and investment Cash received from interest commission charge and commission Net increase of inter-bank fund received Net increase of repurchasing business Net cash received by agent in securities trading Tax returned Other cash received from business operation 184856181.58 103560783.66 Sub-total of cash inflow 4051493610.08 5167390664.45 Cash paid for purchasing of merchandise and services 391854339.69 465134590.94 Net increase of client trade and advance Net increase of savings in central bank and brother company Cash paid for original contract claim Net increase in financial assets held for trading purposes Net increase for Outgoing call loan Cash paid for interest processing fee and commission Cash paid to staffs or paid for staffs 384566222.40 468448589.84 Taxes paid 553265616.61 930941776.42 Other cash paid for business activities 85620190.33 80184520.20 Sub-total of cash outflow from business activities 1415306369.03 1944709477.40 Net cash generated from /used in operating activities 2636187241.05 3222681187.05 II. Cash flow generated by investing Cash received from investment retrieving 210000000.00 192500000.00 Cash received as investment gains 162479782.83 156977952.83 Net cash retrieved from disposal of fixed assets intangible assets and other long-term assets 68875.00 20064135.00 Net cash received from disposal of subsidiaries or other operational units Other investment-related cash received Sub-total of cash inflow due to investment activities 372548657.83 369542087.83 Cash paid for construction of fixed assets intangible assets and 660012394.04 939320280.23 Items Year 2020 Year 2019 other long-term assets Cash paid as investment 224910442.24 225000000.00 Net increase of loan against pledge Net cash received from subsidiaries and other operational units Other cash paid for investment activities Sub-total of cash outflow due to investment activities 884922836.28 1164320280.23 Net cash flow generated by investment -512374178.45 -794778192.40 III.Cash flow generated by financing Cash received as investment Including: Cash received as investment from minor shareholders Cash received as loans 2169880000.00 3576700000.00 Other financing –related cash received 89083500.00 85985000.00 Sub-total of cash inflow from financing activities 2258963500.00 3662685000.00 Cash to repay debts 1730365000.00 3474420769.28 Cash paid as dividend profit or interests 1588108152.77 2305707953.35 Including: Dividend and profit paid by subsidiaries to minor shareholders 380689946.00 665429842.00 Other cash paid for financing activities 1272832461.00 791384.00 Sub-total of cash outflow due to financing activities 4591305613.77 5780920106.63 Net cash flow generated by financing -2332342113.77 -2118235106.63 IV. Influence of exchange rate alternation on cash and cash equivalents 1728690.91 -1534520.73 V.Net increase of cash and cash equivalents -206800360.26 308133367.29 Add: balance of cash and cash equivalents at the beginning of term 3052977164.15 2744843796.86 VI ..Balance of cash and cash equivalents at the end of term 2846176803.89 3052977164.15 6. Cash Flow Statement of the Parent Company In RMB Items Year 2020 Year 2019 I.Cash flows from operating activities Cash received from sales of goods or rending of services 993839736.20 1319322493.90 Tax returned Other cash received from business operation 93504920.38 77128413.98 Sub-total of cash inflow 1087344656.58 1396450907.88 Items Year 2020 Year 2019 Cash paid for purchasing of merchandise and services 103008692.77 127357495.28 Cash paid to staffs or paid for staffs 127409377.73 147473541.71 Taxes paid 38537660.12 49562069.12 Other cash paid for business activities 345450155.26 235160213.53 Sub-total of cash outflow from business activities 614405885.88 559553319.64 Net cash generated from /used in operating activities 472938770.70 836897588.24 II. Cash flow generated by investing Cash received from investment retrieving 150000000.00 105000000.00 Cash received as investment gains 891162907.16 1152310903.36 Net cash retrieved from disposal of fixed assets intangible assets and other long-term assets 7700.00 4900.00 Net cash received from disposal of subsidiaries or other operational units 4694628.72 Other investment-related cash received Sub-total of cash inflow due to investment activities 1045865235.88 1257315803.36 Cash paid for construction of fixed assets intangible assets and other long-term assets 270834718.98 704297796.17 Cash paid as investment 1486620726.24 Net cash received from subsidiaries and other operational units Other cash paid for investment activities Sub-total of cash outflow due to investment activities 1757455445.22 704297796.17 Net cash flow generated by investment -711590209.34 553018007.19 III. Cash flow generated by financing Cash received as investment Cash received as loans 1809290000.00 3290000000.00 Other financing –related ash received Sub-total of cash inflow from financing activities 1809290000.00 3290000000.00 Cash to repay debts 1479775000.00 2575665000.00 Cash paid as dividend profit or interests 1101090057.96 1407137756.96 Other cash paid for financing activities 1122177.00 791384.00 Sub-total of cash outflow due to financing activities 2581987234.96 3983594140.96 Net cash flow generated by financing -772697234.96 -693594140.96 IV. Influence of exchange rate alternation on cash and cash equivalents 1728690.91 -1534520.73 Items Year 2020 Year 2019 V.Net increase of cash and cash equivalents -1009619982.69 694786933.74 Add: balance of cash and cash equivalents at the beginning of term 2790163301.78 2095376368.04 VI ..Balance of cash and cash equivalents at the end of term 1780543319.09 2790163301.78 2020 Annual Report 7. Consolidated Statement on Change in Owners’ Equity Amount in this period In RMB Items Year 2020 Owner’s equity Attributable to the Parent Company Minor shareholders’ equity Total of owners’ equityShare Capital Other Equity instrument Capital reserves Less : Shar es in stoc k Other Comprehens ive Income Speciali zed reserve Surplus reserves Common risk provision Retained profit Other SubtotalPrefer red stock Sust aina ble debt Other I.Balance at the end of last year 2090806126. 00 309401 7129.31 382193344.90 10745530 52.81 391579081 0.76 10557360 463.78 2139676884.88 12697037348.66 Add: Change of accounting policy Correcting of previous errors Merger of entities under common control Other II.Balance at the beginning of current year 2090806126. 00 309401 7129.31 382193344.90 10745530 52.81 391579081 0.76 10557360 463.78 2139676884.88 12697037348.66 III.Changed in the current year -244804 7918.83 -79297467.25 93232912. 82 -190111491. 41 -2624223 964.67 159503200.29 -2464720764.38 （1）Total comprehensive income -79297467.25 867842774. 78 78854530 7.53 496542231.29 1285087538.82（II）Investment or decreasing 454325 45432585. 43650915.00 89083500.00 2020 Annual Report Items Year 2020 Owner’s equity Attributable to the Parent Company Minor shareholders’ equity Total of owners’ equityShare Capital Other Equity instrument Capital reserves Less : Shar es in stoc k Other Comprehens ive Income Speciali zed reserve Surplus reserves Common risk provision Retained profit Other SubtotalPrefer red stock Sust aina ble debt Other of capital by owners 85.00 00 1．Ordinary Shares invested by shareholders 2．Holders of other equity instr uments invested capital 3．Amount of shares paid and accounted as owners’ equity 4．Other 454325 85.00 45432585. 00 43650915.00 89083500.00（III）Profit allotment 93232912. 82 -105795426 6.19 -96472135 3.37 -380689946.00 -1345411299.37 1.Providing of surplus reserves 93232912. 82 -93232912.8 2 2.Providing of common risk provisions 3．Allotment to the owners (or shareholders) -882320185. 17 -88232018 5.17 -380689946.00 -1263010131.17 4．Other -82401168.2 -82401168 -82401168.20 2020 Annual Report Items Year 2020 Owner’s equity Attributable to the Parent Company Minor shareholders’ equity Total of owners’ equityShare Capital Other Equity instrument Capital reserves Less : Shar es in stoc k Other Comprehens ive Income Speciali zed reserve Surplus reserves Common risk provision Retained profit Other SubtotalPrefer red stock Sust aina ble debt Other 0 .20 (IV) Internal transferring of owners’ equity 1. Capitalizing of capital reserves (or to capital shares) 2. Capitalizing of surplus reserves (or to capital shares) 3．Making up losses by surplus reserves. 4.Change amount of defined benefit plans that carry forward Retained earnings 5．Other comprehensive income carry-over retained earnings 6．Other (V). Special reserves 1. Provided this year 2020 Annual Report Items Year 2020 Owner’s equity Attributable to the Parent Company Minor shareholders’ equity Total of owners’ equityShare Capital Other Equity instrument Capital reserves Less : Shar es in stoc k Other Comprehens ive Income Speciali zed reserve Surplus reserves Common risk provision Retained profit Other SubtotalPrefer red stock Sust aina ble debt Other 2．Used this term（VI）Other -249348 0503.83 -2493480 503.83 -2493480503.83 IV. Balance at the end of this term 2090806126. 00 645969 210.48 302895877.65 11677859 65.63 372567931 9.35 79331364 99.11 2299180085.17 10232316584.28 2020 Annual Report Amount in last year Items Year 2019 Owner’s equity Attributable to the Parent Company Minor shareholders’ equity Total of owners’ equity Share Capital Other Equity instrument Capital reserve s Less: Shares in stock Other Comprehe nsive Income Specia lized reserv e Surplus reserves Commo n risk provisio n Retained profit Other Subtotal Pref erred stoc k Sustai nable debt Othe r I.Balance at the end of last year 2090806126 .00 253677 4965.31 245109114 .81 775402561 .35 3938609136. 59 95867019 04.06 459599723.87 10046301627.93 Add: Change of accounting policy 10196938. 48 -9749843.30 447095.18 447095.18 Correcting of previous errors Merger of entities under common control 513389 814.00 164127983 .91 17247058.59 694764856 .50 1621117998.50 2315882855.00 Other II.Balance at the beginning of current year 2090806126 .00 305016 4779.31 255306053 .29 939530545 .26 3946106351. 88 10281913 855.74 2080717722.37 12362631578.11 III.Changed in the current year 438523 50.00 126887291 .61 135022507 .55 -30315541.12 275446608 .04 58959162.51 334405770.55 （1）Total comprehensive income 126887291 .61 1469187067. 83 15960743 59.44 682256354.52 2278330713.96（II）Investment or decreasing of capital by owners 438523 50.00 43852350. 00 42132650.00 85985000.00 2020 Annual Report 1．Ordinary Shares invested by s hareholders 2．Holders of other equity instru ments invested capital 3．Amount of shares paid and accounted as owners’ equity 4．Other 438523 50.00 43852350. 00 42132650.00 85985000.00（III）Profit allotment 135022507 .55 -1499502608 .95 -13644801 01.40 -665429842.01 -2029909943.41 1.Providing of surplus reserves 135022507 .55 -135022507.5 5 2.Providing of common risk provisions 3．Allotment to the owners (or shareholders) -1175033042 .81 -11750330 42.81 -665429842.01 -1840462884.82 4．Other -189447058.5 9 -18944705 8.59 -189447058.59 (IV) Internal transferring of owners’ equity 1. Capitalizing of capital reserves (or to capital shares) 2. Capitalizing of surplus reserves (or to capital shares) 3．Making up losses by surplus reserves. 2020 Annual Report In RMB 4.Change amount of defined benefit plans that carry forward Retained earnings 5．Other comprehensive income carry-over retained earnings 6．Other (V). Special reserves 1. Provided this year 2．Used this term（VI）Other IV. Balance at the end of this term 2090806126 .00 309401 7129.31 382193344 .90 10745530 52.81 3915790810. 76 10557360 463.78 2139676884.88 12697037348.66 2020 Annual Report 8.Statement of change in owner’s Equity of the Parent Company Amount in this period In RMB Items Year 2020 Share capital Other Equity instrument Capital reserves Less: Shares in stock Other Comprehen sive Income Specialize d reserve Surplus reserves Retained profit Other Total of owners’ equity Preferr ed stock Sustai nable debt Other I.Balance at the end of last year 2090806126 .00 29744586 96.93 382193344 .90 894580785.25 3710584722. 68 10052623675.76 Add: Change of accounting policy Correcting of previous errors Other II.Balance at the beginning of current year 2090806126 .00 29744586 96.93 382193344 .90 894580785.25 3710584722. 68 10052623675.76 III.Changed in the current year -20354891 50.14 -79297467 .25 93232912.82 -43041559.32 -2064595263.89 （I）Total comprehensive income -79297467 .25 932329128.2 4 853031660.99 (II) Investment or decreasing of capital by owners 26725050. 00 -2035489150.14 1．Ordinary Shares invested by s hareholders 2020 Annual Report Items Year 2020 Share capital Other Equity instrument Capital reserves Less: Shares in stock Other Comprehen sive Income Specialize d reserve Surplus reserves Retained profit Other Total of owners’ equity Preferr ed stock Sustai nable debt Other 2．Holders of other equity instru ments invested capital 3.Amount of shares paid and accounted as owners’ equity 4．Other 26725050. 00 -2035489150.14（III）Profit allotment 93232912.82 -975553097.9 9 -882320185.17 1.Providing of surplus reserves 93232912.82 -93232912.82 2．Allotment to the owners (or shareholders) -882320185.1 7 -882320185.17 3．Other (IV) Internal transferring of owners’ equity 182410.43 182410.43 1. Capitalizing of capital reserves (or to capital shares) 2. Capitalizing of surplus reserves (or to capital shares) 3．Making up losses by surplus reserves. 2020 Annual Report Items Year 2020 Share capital Other Equity instrument Capital reserves Less: Shares in stock Other Comprehen sive Income Specialize d reserve Surplus reserves Retained profit Other Total of owners’ equity Preferr ed stock Sustai nable debt Other 4.Change amount of defined benefit plans that carry forward Retained earnings 5．Other comprehensive income carry-over retained earnings 6．Other 182410.43 182410.43 (V) Special reserves 1. Provided this year 2．Used this term（VI）Other -20622142 00.14 IV. Balance at the end of this term 2090806126 .00 938969546 .79 302895877 .65 987813698.07 3667543163. 36 7988028411.87 2020 Annual Report Amount in last year In RMB Items Year 2019 Share Capital Other Equity instrument Capital reserves Less: Shares in stock Other Comprehens ive Income Specializ ed reserve Surplus reserves Retained profit Other Total of owners’ equity Prefe rred stock Susta inabl e debt Other I.Balance at the end of last year 2090806126.0 0 294866319 6.93 245109114 .81 759558277.70 3680165040. 86 9724301756.30 Add: Change of accounting policy 10196938. 48 -9749843.30 447095.18 Correcting of previous errors Other II.Balance at the beginning of current year 2090806126.0 0 294866319 6.93 255306053 .29 759558277.70 3670415197. 56 9724748851.48 III.Changed in the current year 25795500.0 0 126887291 .61 135022507.55 40169525.12 327874824.28 （I）Total comprehensive income 126887291 .61 1350225075. 48 1477112367.09 (II) Investment or decreasing of capital by owners 25795500.0 0 25795500.00 1．Ordinary Shares invested by sh areholders 2．Holders of other equity instru 2020 Annual Report Items Year 2019 Share Capital Other Equity instrument Capital reserves Less: Shares in stock Other Comprehens ive Income Specializ ed reserve Surplus reserves Retained profit Other Total of owners’ equity Prefe rred stock Susta inabl e debt Other ments invested capital 3.Amount of shares paid and accounted as owners’ equity 4．Other 25795500.0 0 25795500.00（III）Profit allotment 135022507.55 -1310055550 .36 -1175033042.81 1.Providing of surplus reserves 135022507.55 -135022507.5 5 2．Allotment to the owners (or shareholders) -1175033042 .81 -1175033042.81 3．Other (IV) Internal transferring of owners’ equity 1. Capitalizing of capital reserves (or to capital shares) 2. Capitalizing of surplus reserves (or to capital shares) 3．Making up losses by surplus 2020 Annual Report Items Year 2019 Share Capital Other Equity instrument Capital reserves Less: Shares in stock Other Comprehens ive Income Specializ ed reserve Surplus reserves Retained profit Other Total of owners’ equity Prefe rred stock Susta inabl e debt Other reserves. 4.Change amount of defined benefit plans that carry forward Retained earnings 5．Other comprehensive income carry-over retained earnings 6．Other (V) Special reserves 1. Provided this year 2．Used this term（VI）Other IV. Balance at the end of this term 2090806126.0 0 297445869 6.93 382193344 .90 894580785.25 3710584722. 68 10052623675.76 III. Company Profile 1. Basic information of the IPO and share capital of the company 1.The Company was established in February 1993 which was originally named as Guangdong Fokai Expressway Co. Ltd. On June 30 1993 it was renamed as Guangdong Provincial Expressway Development Co. Ltd. after reorganization pursuant to the approval of the Office of Joint Examination Group of Experimental Units of Share Holding System with YLSB (1993)No. 68 document. The share capital structure after reorganization is as follows: Composition of state-owned shares: The appraised net value of state-owned assets of Guangdong Jiujiang Bridge Co. and Guangfo Expressway Co. Ltd. as of January 31 1993 confirmed by Guangdong State-owned Asset Management Dept. i.e.RMB 418.2136 million was converted into 155.025 million shares. Guangdong Expressway Co. invested cash of RMB 115 million to subscribe for 35.9375 million shares. Other legal persons invested cash of RMB 286.992 million to subscribe for 89.685 million shares. Staff of the Company invested RMB 87.008 million to subscribe for 27.19 million shares. The total is RMB 307.8375 million shares. 2． Pursuant to the approval of Guangdong Economic System Reform Committee and Guangdong Securities Regulatory Commission with YTG (1996) No. 67 document part of the shareholders of non-state-owned legal person shares transferred 20 million non-state-owned legal person shares to Malaysia Yibao Engineering Co. Ltd.in June 1996. 3. Pursuant to the approval of Securities Commission under the State Council with WF (1996) No. 24 approval document and that of Guangdong Economic System Reform Committee with YTG (1996) No. 68 document the Company issued 135 million domestically listed foreign investment shares (B shares) to overseas investors at the price of HKD 3.54 (equivalent to RMB 3.8) with the par value of each share being RMB 1 during June to July 1996. 4. Pursuant to the reply of the Ministry of Foreign Trade and Economic Cooperation of the People’ s Republic of China with (1996) WJMZYHZ No. 606 document the Company was approved to be a foreign-invested joint stock company limited. 5．The Company distributed dividends and capitalized capital common reserve for the year 1996 in the following manner: The Company paid 1.7 bonus shares f or each 10 shares and capitalized capital common reserve on 3.3-for-10 basis. 6. Pursuant to the approval of China Securities Regulatory Committee (CSRC) with ZJFZ (1997) No. 486 and No. 487 document the Company issued 100 million public shares (A shares) at the price of RMB 5.41 in term of “payable in full on application pro-rate placing and subject to refund” with the par value of each share being RMB 1 in January 1998. 7．In accordance with the Resolutions of the 1999 Shareholders’ General Meeting of the Company and pursuant to the approval of Guangzhou Securities Regulatory Office under CSRC with GZZJH (2000) No. 99 and that of CSRC with ZJGSZ (2000) No. 98 the Company offered 3 Rights for every 10 shares of 764.256249 million shares at the price of RMB 11 per Right.73822250 ordinary shares were actually placed to all . 8. Pursuant to the reply of the General Office of the People’ s Government of Guangdong Province with YBH (2000) No. 574 document the state-owned shares were transferred to Guangdong Communication Group Co. Ltd. (Group Co.) for holding and management without compensation. 9.Pursuant to the approval of Shenzhen Stock Exchange 53.0205 million staff shares of the Company (132722 shares held by directors supervisors and senior executives are temporarily frozen) were listed on February 5 2001. 10.In accordance with the resolutions of 2000 annual shareholders’ general meeting the Company capitalized capital common reserve into 419039249 shares on 5-for-10 basis with the total share capital as of the end of 2000 i.e. 838078499 shares as base. The date of stock right registration was May 21 2001. The ex-right date was May 22 2001. 11 ． On March 8 2004As approved by China Securities Regulatory Commission by document Zheng-Jian-Gong-Si-Zi [2003]No.3 the 45000000 non-negotiable foreign shares were placed in Shenzhen Stock 12. On December 21 2005 the Company's plan for share holding structure reform was voted through at theshareholders' meeting concerning A shares. On January 26 2006 The Ministry of Commerce of PRC issued “Theapproval on share converting of Guangdong Provincial Expressway Development Co. Ltd.” to approve the shareequity relocation and transformation. On October 9 2006 according to the“Circular about implementing of shareequity relocation and relative trading”issued by Shenzhen Stock Exchange the abbreviation ID of the Company’ s A shares was restored from “G-Expressway” “Expressway A”. 13. Upon the approval document of CSRC No.230-2016 Zheng Jian Xu ke-Approval of the Share-Issuing to Parties such as Guangdong Provincial Expressway Co. Ltd to Purchase Assets and Raise Matching Funds by Guangdong Provincial Expressway Development Co. Ltd in June 2016 the company issued 33355263 shares and paid RMB 803.50 million to Guangdong Provincial Expressway Co. Ltd for purchasing the 25% stake of Guangdong Provincial Fokai Expressway Co. Ltd held by Guangdong Provincial Expressway Co. Ltd; and issued 466325020 shares to Guangdong Provincial Highway Construction Co. Ltd for purchasing the 100% stake of Guangzhou Guangzhu Traffic Investment Management Co. Ltd held by Guangdong Provincial Highway Construction Co. Ltd. On June 21 2016 the company directionally issued 334008095 A-shares to Yadong Fuxing Yalian Investment Co.Ltd Tibet Yinyue Investment Management Co.Ltd and Guangfa Securities Co.Ltd. The issuance of shares have been registered on July 7 2016 the new shares will be listed on July 8 2016. 2. Company's registered place and headquarters address Company name：Guangdong Provincial Expressway Development Co. Ltd. Registration placeNo.85 Baiyun Road Yuexiu District Guangzhou.Headquarters Office ：45-46/F Litong Plaza No.32 Zhujiang East Road Zhujiang New City Tihe Disrtict Guangzhou 3. Business nature and main business activities Industry and main products of the company: highway management and maintenance.General business items: investment construction charging maintenance and service management of expressways grade roads and bridges; Automobile rescue service maintenance and cleaning; Parking lot charges; Design production release and agency of all kinds of advertisements at home and abroad; Land development along the highway; Warehousing business; Intelligent transportation technology research and development and service; Equity investment management and consultation. (Projects that must be approved according to law can be operated only after being approved by relevant departments).The Company is mainly engaged in tolling and maintenance of Guangfo Expressway Fokai Expressway and Jingzhu Expressway Guangzhu Section investment in technological industries and provision of relevant consultation while investing in Shenzhen Huiyan Expressway Co. Ltd. Guangzhou Guanghui Expressway Co. Ltd.Jingzhu Expressway Guangzhu Co. Lt d.Guangdong Jiangzhong Expressway Co. Ltd. Zhaoqing Yuezhao Expressway Co. Ltd.Ganzhou Kangda Expre ssway Ganzhou Gankang Expressway Co. Ltd.Guangdong Yueke Technology Micro Loan Co. Ltd.Guangdong Guangle Expressway Co.Ltd.， Guoyuan Securities Co. Ltd.and Hunan Lianzhi Technology Co. Ltd. 4. Scope and changes of consolidated financial statements in the current period (1) Scope of current consolidated financial statements The consolidated scope of the current financial statements invovles Guangdong Expressway Technology Investment Co. Ltd. Guangzhou Guangzhu Transportation Investment Management Co. Ltd. Yuegao Capital Investment (Hengqin) Co. Ltd. its holding subsidiaries Guangfo Expressway Co. Ltd. ，Jingzhu ExpresswayGuangzhu Section Co. Ltd. and Guangdong Guanghui Expressway Co. Ltd..The subsidiaries newly included in the consolidation scope in this period include: subsidiaries acquired by business combination under the same control: Guangdong Guanghui Expressway Co. Ltd..In this period due to absorption and combination the subsidiaries that are no longer combined include: Guangzhou Guangzhu Transportation Investment Management Co. Ltd. 5. Approval and submission date of financial report The financial statements have been authorized for issuance by the 16th meeting of the Ninth Board of Directors of the Company on March 25 2021.IV. Basis for the preparation of financial statements 1.Preparation basis The financial statements of the Company have been prepared on basis of going concern in conformity with Chinese Accounting Standards for Business Enterprises and the Accounting Systems for Business Enterprises issued by the Ministry of Finance of People’s Republic of China (Ministry of Finance issued order No.33 the Ministry of Finance revised order No.76) on February 15 2006 and revised Accounting Standards (order 42 of the Ministry of Finance) and Compilation Rules for Information Disclosure by Companies Offering Securities to the Public No.15 – General Provisions on Financial Reports (2014 Revision) issued by the China Securities Regulatory Commission (CSRC). According to the relevant accounting regulations in Chinese Accounting Standards for Business Enterprises the Company has adopted the accrual basis of accounting. Held-for-sale non-current assets are measured at the lower of its book value at its classification date and fair value minus expected disposal costs. Where assets are impaired provisions for asset impairment are made in accordance with relevant requirements 2.Continuation There will be no such events or situations in the 12 months from the end of the reporting period that will cause material doubts as to the continuation capability of the Company.V. Significant Accounting Policies and Accounting Estimates Specific accounting policies and accounting estimates are indicated as follows: According to the actual production and operation characteristics and the provisions of relevant accounting standards for enterprises the Group has formulated a number of specific accounting policies and accounting estimates for revenue recognition and other transactions and events. For details see "25 Revenue" in V of this section. Please refer to "32 Significant Accounting Judgments and Estimates" in V of this section for explanations of significant accounting judgements and estimates made by management. 1. Statement of Compliance with the Accounting Standards for Business Enterprises The financial statements of the Company are recognized and measured in accordance with the regulations in the Chinese Accounting Standards for Business Enterprises and they give a true and fair view of the financial position business result and cash flow of the Company as of December 31 2020 and year 2020. In addition the financial statements of the Company comply in all material respects with the revised disclosing requirements for financial statements and the Compilation Rules for Information Disclosure by Companies Offering Securities to the Public No.15 — General Provisions on Financial Reports (2014 Revision) issued by China Securities Regulatory Commission (CSRC). 2. Accounting period The accounting period of the Company is classified as interim period and annual period. Interim period refers to the reporting period shorter than a complete annual period. The accounting period of the Company is the calendar year from January 1 to December 31. 3.Operating cycle The normal operating cycle refers to the period from the time when the Group purchases assets for processing to the time when cash or cash equivalents are realized. The Company takes 12 months as a business cycle and uses it as a criterion for liquidity classification of assets and liabilities. 4.Standard currency for bookkeeping The Company adopts CNY to prepare its functional statements. 5.Accountings for Business Combinations under the Same Control & Business Combinations not under the Same Control 1.Business Combinations under the Same Control If business participating in the combination are ultimately controlled by the same party or parties before and after the combination and the control is not temporary it is an business combination under the same control.Usually business combination under the same control refers to the combination between business within the same business except which it is generally not regarded as business combination under the same control.The assets and liabilities obtained by the Company as the combining party in the business combination shall be measured according to the book value of the combined party in the consolidated financial statements of the ultimate controlling party on the combination date. For the long-term equity investment formed by holding combination under the same control the company takes the share of the book owner's equity of the combined party on the combination date as the initial investment cost for forming the long-term equity investment. See the long-term equity investment for relevant accounting treatment; The assets and liabilities obtained by absorption and combination under the same control shall be recorded by the Company according to the original book value of the related assets and liabilities in the combined party. The company adjusts the capital reserve according to the difference between the book value of the net assets obtained and the book value of the combination consideration paid (or the total par value of the issued shares); If the capital reserve is insufficient to offset the retained earnings shall be adjusted. All directly related expenses incurred by the Company as a combining party for business combination including audit fees evaluation fees legal service fees etc. are included in the current profits and losses when incurred. Fees and commissions paid for bonds issued by enterprises or other debts shall be included in the initial measurement amount of bonds and other debts issued. Fees commissions and other expenses incurred in issuing equity securities in business combination shall be offset against the premium income of equity securities and if the premium income is insufficient to offset the retained earnings shall be offset.If the holding under the same control is combined to form a parent-subsidiary relationship the parent company shall prepare consolidated financial statements on the consolidation date including consolidated balance sheet consolidated income statement and consolidated cash flow statement. For the consolidated balance sheet the book value of the combined party in the consolidated financial statements of the ultimate controlling party shall be incorporated into the consolidated financial statements and the transactions between the combining party and the combined party on the consolidation date and the previous period shall be regarded as internal transactions and offset according to the relevant principles of "Consolidated Financial Statements"; The consolidated income statement and cash flow statement include the net profit and cash flow realized by the combining party and the combined party from the beginning of the current consolidation period to the consolidation date and involve the cash flow generated by the transactions and internal transactions between the two parties in the current period which shall be offset according to the relevant principles of the consolidated financial statements. 2. If the parties involved in the combination are not ultimately controlled by the same party or parties before and after the combination it is a business combination not under the same control. Business Combinations not under the Same Control Determine the cost of business combination: the cost of business combination includes the fair value of cash or non-cash assets paid by the purchaser for business combination debts issued or assumed and equity securities issued on the purchase date.In the business combination not under the same control the intermediary expenses such as auditing legal services evaluation and consultation and other related management expenses incurred by the purchaser for the business combination shall be included in the current profits and losses when they occur; Transaction costs of equity securities or debt securities issued by the purchaser as combination consideration shall be included in the initial recognized amount of equity securities or debt securities. For the long-term equity investment obtained by holding combination not under the same control the company takes the combination cost determined on the purchase date (excluding cash dividends and profits that should be collected from the investee) as the initial investment cost for the long-term equity investment of the purchaser; All identifiable assets and liabilities obtained by absorption and combination under different control that meet the recognition conditions shall be recognized as assets and liabilities of the enterprise at fair value on the date of purchase. If the Company takes non-monetary assets as consideration to obtain the control right of the purchaser or various identifiable assets and liabilities the difference between the fair value of the relevant non-monetary assets on the purchase date and their book value shall be taken as the disposal profit and loss of the assets and recorded in the income statement of the current consolidation period.In a business combination not under the same control the difference between the cost of business combination and the fair value share of identifiable net assets of the purchaser obtained in the combination is recognized as goodwill; In the case of absorption and combination the difference is recognized as goodwill in the individual financial statements of the parent company; In the case of holding combination the difference is listed as goodwill in the consolidated financial statements.The cost of business combination is less than the difference between the fair value share of identifiable net assets acquired during the combination which is included in the profits and losses (non-operating income) of the current combination period after review by the Company. In the case of absorption and combination the difference is included in the individual income statement of the parent company in the current combination period; In the case of holding combination the difference is included in the consolidated income statement of the current combination period.If the business combination not under the same control realized step by step through multiple exchange transactions is a package transaction each transaction will be treated as a transaction to obtain control rights; If it is not a package transaction the equity of the purchased party held before the purchase date shall be re-measured according to the fair value of the equity on the purchase date and the difference between the fair value and its book value shall be included in the current investment income; If the equity of the purchased party held before the purchase date involves other comprehensive income other comprehensive income related to it shall be converted into the investment income of the current period on the purchase date except for other comprehensive income arising from the re-measurement of net liabilities or changes in net assets of the defined benefit plans by the invested party. 6. Compilation method of consolidated financial statements (1) Consolidation scope The consolidation scope of consolidated financial statements is determined on the basis of control. Control means that the Company has the power over the investee is entitled to variable returns by participating in the related activities of the investee and has the ability to use the power over the investee to influence its return amount. Subsidiaries refer to subjects controlled by the Company (including enterprises divisible parts of investee(s) structured subjects etc.). (2) Compilation method of consolidated financial statements The consolidated financial statements of the Company are based on the financial statements of the parent company and its subsidiaries and are prepared according to other relevant information. When compiling the important internal transactions between the parent company and its subsidiaries such as investment transactions purchase and sale of inventories and their unrealized profits are offset and combined item by item and the minority shareholders' rights and interests and the current income of minority shareholders are calculated. If the accounting policies and accounting periods of subsidiaries are inconsistent with those of the parent company the accounting statements of subsidiaries shall be adjusted according to the accounting policies and accounting periods of the parent company before combination. (3) Increase and decrease the consolidated report processing of subsidiaries during the reporting period During the reporting period when preparing the consolidated balance sheet the balance at the beginning of the consolidated balance sheet is adjusted for the subsidiaries added due to business combination under the same control. When preparing the consolidated balance sheet the balance at the beginning of the year of the consolidated balance sheet is not adjusted for the subsidiaries added due to business combination not under the same control. During the reporting period the subsidiaries are disposed of and the balance at the beginning of the consolidated balance sheet is not adjusted when the consolidated balance sheet is prepared. During the reporting period the income expenses and profits of subsidiaries added by business combination under the same control from the beginning to the end of the reporting period are included in the consolidated income statement and the cash flows from the beginning to the end of the reporting period are included in the consolidated cash flow statement. For subsidiaries added due to business combination not under the same control the income expenses and profits of such subsidiaries from the purchase date to the end of the reporting period are included in the consolidated income statement and their cash flow from the purchase date to the end of the reporting period is included in the consolidated cash flow statement. During the reporting period the subsidiary is disposed of and the income expenses and profits from the beginning of the period to the disposal date are included in the consolidated income statement and the cash flow from the beginning of the period to the disposal date is included in the consolidated cash flow statement.When the control right of the original subsidiary is lost due to the disposal of part of the equity investment or other reasons the remaining equity investment after disposal shall be re-measured according to its fair value on the date of loss of control right. The sum of the consideration obtained from the disposal of equity and the fair value of the remaining equity minus the difference between the share of the original subsidiary's net assets calculated continuously from the purchase date and the sum of goodwill calculated according to the original shareholding ratio is included in the investment income in the current period when the control right is lost. Other comprehensive income related to the original subsidiary's equity investment is converted into current investment income when the control right is lost except for other comprehensive income generated by the investee's re-measurement of net liabilities or changes in net assets of the set income plan.The difference between the newly acquired long-term equity investment due to the purchase of minority shares and the identifiable net assets share of subsidiaries calculated according to the increased shareholding ratio and the difference between the disposal price obtained from partial disposal of equity investment in subsidiaries and the net assets share of subsidiaries corresponding to the disposal of long-term equity investment are used to adjust the equity premium in the capital reserve in the consolidated balance sheet. If the equity premium in the capital reserve is insufficient to offset the retained earnings will be adjusted. (4) Processing of consolidated statements from step-by-step disposal of equity to loss of control rights If the transactions that dispose of the equity investment in subsidiaries until the loss of control rights are of a package transaction the transactions shall be treated as transactions that dispose of subsidiaries and lose control rights; However the difference between the disposal price and the share of the subsidiary's net assets related to the disposal investment before the loss of control right is recognized as other comprehensive income in the consolidated financial statements which will be transferred to the current profit and loss when the control right is lost except for other comprehensive income arising from the re-measurement of the net liabilities or changes in net assets of the set income plan by the investee. If it is not a package transaction before the loss of control the difference between the disposal price and the corresponding net assets continuously calculated by the subsidiary from the purchase date will be adjusted to the capital reserve and if the capital reserve is insufficient to offset the retained earnings will be adjusted; In case of loss of control right the accounting treatment shall be carried out according to the above accounting policy when the control right over the original subsidiary is lost. 7.Joint venture arrangements classification and Co-operation accounting treatment A joint arrangement is an arrangement of which two or more parties have joint control. A joint arrangement is either a joint operation or a joint venture depending on the rights and obligation of the Company in the joint arrangement. A joint operation is a joint arrangement whereby the Company has rights to the assets and obligations for the liabilities relating to the arrangement. A joint venture is a joint arrangement whereby the Company has rights to the net assets of the arrangement. (1) Identification of joint venture arrangement As long as two or more participants exercise joint control over an arrangement such arrangement can be regarded as a joint venture arrangement and all participants are not required to be entitled to joint control over the arrangement. (2) Reassessment If the legal form contract terms and other relevant facts and circumstances change the participants in the joint venture arrangement shall reassess the joint venture arrangement: First assess whether the original joint venture party still has joint control over the arrangement; Second assess whether the type of joint venture arrangement has changed. (3) Accounting treatment of participants in joint operation ① Accounting treatment of the joint venture in joint operation A. General accounting principles The joint venture shall recognize the following items related to its share of interests in the joint operation and carry out accounting treatment in accordance with the relevant accounting standards for enterprises: Firstly recognize the assets held separately and recognize the assets held jointly according to their share; Secondly recognize the liabilities undertaken separately and recognize the liabilities jointly undertaken according to their share; Thirdly recognize the income generated from the sale of its share of joint operating output; Fourthly recognize the income generated by the joint operation due to the sale of output according to its share; Fifthly recognize the expenses incurred separately and recognize the expenses incurred in joint operation according to its share.The joint venture may use its own assets for joint operations. If the joint venture retains all ownership or control over these assets the accounting treatment of these assets is no different from the accounting treatment of the joint venture's own assets.The joint venture may also purchase assets together with other joint ventures to invest in joint operations and jointly bear the liabilities of joint operations. In this case the joint venture shall recognize the interest share in these assets and liabilities in accordance with the relevant provisions of the Accounting Standards for Business Enterprises. For example according to the Accounting Standards for Business Enterprises No.4-Fixed Assets the interest share in related fixed assets is recognized and the share in related financial assets and financial liabilities is recognized according to the financial instrument recognition and measurement standards.When the joint operation is achieved through a separate entity the joint venture shall recognize the liabilities undertaken separately according to the above principles and recognize the liabilities jointly undertaken according to the share of the enterprise. However if the joint venture is jointly and severally liable in accordance with the relevant laws of China or the relevant contractual stipulations due to the failure of other shareholders to provide funds to the joint venture arrangement as agreed its accounting treatment shall be subject to the Accounting Standards for Business Enterprises No.13-Contingencies. B. Accounting treatment for the joint venture to invest or sell assets that do not constitute business. When the joint venture invests or sells assets for joint operation (except that the assets constitute business) before the joint operation sells the related assets to a third party or the related assets are consumed (i.e. the unrealized internal profits are still included in the book value of the assets held by the joint venture) only the gains or losses attributable to other participants in the joint venture shall be recognized. If the transaction shows that the assets invested or sold meet the asset impairment losses specified in Accounting Standards for Business Enterprises No.8-Asset Impairment (hereinafter referred to as "Asset Impairment Loss Standards") the joint venture shall fully recognize the losses. C. Accounting treatment of assets purchased by the joint venture from joint operation that do not constitute business Before the joint venture buys assets from joint operation (except that the assets constitute business) and sells the assets to a third party (i.e. when unrealized internal profits are still included in the book value of assets held by the joint venture) the share of profits and losses arising from the transaction that the joint venture is entitled to shall not be recognized. That is at this time only the part of the profit and loss arising from the transaction that belongs to other participants in the joint operation shall be recognized. D. Accounting treatment of the joint venture's share of the interests of the joint operation that constitutes the business When the joint venture obtains the share of interests in the joint operation and the joint operation constitutes business the corresponding accounting treatment shall be carried out in accordance with the relevant standards such as business combination standards however the provisions of other relevant standards cannot conflict with the provisions of the joint venture arrangement standards. The enterprise shall judge whether the joint operation constitutes a business in accordance with the relevant provisions of the business combination standards. This treatment principle is not only applicable to the acquisition of the share of interests in the existing joint operation that constitutes business but also to the establishment of joint operation with other participants and because other participants introduce the existing business the joint operation constitutes business when it is established. ② Accounting principles for participants who do not enjoy joint control over joint operations Participants (non-joint ventures) who are not entitled to joint control of the joint operation shall be treated as the joint ventures if they are entitled to the assets related to the joint operation and bear the liabilities related to the joint operation. That is the participants in the joint operation regardless of whether they are entitled to joint control or not will be subject to the same accounting treatment as the joint ventures as long as they are entitled to the right to jointly operate related assets and undertake the liabilities obligation related to joint operation.Otherwise its profit share shall be accounted for in accordance with the relevant accounting standards for enterprises.（(4) Accounting treatment of participants in a joint ventureIn a joint venture the participants shall account for their investment in the joint venture in accordance with the Accounting Standards for Business Enterprises No.2-Long-term Equity Investment.Participants (non-parties) who are not entitled to joint control over the joint venture shall carry out relevant accounting treatment according to their influence on the joint venture: if they have significant influence on the joint venture their investment in the joint venture shall be accounted for in accordance with the provisions of the long-term equity investment standards; If it has no significant impact on the joint venture its investment in the joint venture shall be accounted for in accordance with the provisions of the Standards for Recognition and Measurement of Financial Instruments. 8.Recognition Standard of Cash & Cash Equivalents Cash and cash equivalents of the Company include cash on hand ready usable deposits and investments having short holding term (normally will be due within three months from the day of purchase) with strong liquidity and easy to be exchanged into certain amount of cash that can bemeasured reliably and have low risks of change. 9.Foreign Currency Transaction (1) Foreign currency business Foreign currency transactions of the Company are converted into the amount of bookkeeping base currency according to the spot rate on the transaction date.On the balance sheet date foreign currency monetary items and foreign currency non-monetary items shall be treated according to the following provisions: foreign currency monetary items shall be converted at the spot rate on the balance sheet date. Exchange differences arising from the difference between the spot rate on the balance sheet date and the spot rate at the time of initial recognition or the previous balance sheet date are included in the current profits and losses; Foreign currency non-monetary items measured at historical cost are still converted at the spot rate on the transaction date without changing their bookkeeping base currency amount; Foreign currency non-monetary items measured at fair value shall be converted at the spot rate on the fair value determination date and the difference between the converted bookkeeping base currency amount and the original bookkeeping base currency amount shall be treated as changes in fair value (including exchange rate changes) and included in the current profits and losses; During the capitalization period the exchange difference between the principal and interest of foreign currency special loans is capitalized and included in the cost of assets that meet the capitalization conditions. (2) Translation of foreign currency financial statements When converting foreign currency financial statements the Company shall comply with the following regulations: assets and liabilities in the balance sheet shall be converted at the spot rate on the balance sheet date and other items of owner's equity except "undistributed profits" shall be converted at the spot rate at the time of occurrence; The income and expense items in the income statement shall be converted at the spot rate on the transaction date (or at the exchange rate determined by a systematic and reasonable method and similar to the spot rate on the transaction date). The translation difference of foreign currency financial statements generated according to the above translation is recognized as other comprehensive income. The conversion of comparative financial statements shall be handled according to the above provisions. 10.Financial instruments The Company recognizes the financial assets or liabilities when involved in financial instruments’ agreements. （1）Classification recognition and measurement of financial assets In accordance with the characteristics of business model for managing financial assets and the contractual cash flow of financial assets the Company classifies financial assets into: financial assets measured in amortized cost; financial assets measured at fair value and their's changes are included in other comprehensive income; financial assets measured at fair value and their's changes are included in current profits and losses.The initial measurement of financial assets is calculated by using fair value. For financial assets measured at fair value whose changes are included in current profits and losses relevant transaction costs are directly included in current profits and losses; For other types of financial assets relevant transaction costs are included in the initial recognition amount. ①Financial assets measured at amortized cost The business model of the Company's management of financial assets measured by amortized cost is aimed at collecting the contractual cash flow and the contractual cash flow characteristics of such financial assets are consistent with the basic lending arrangements that is the cash flow generated on a specific date is only the payment of principal and interest based on the amount of outstanding principal. For such financial assets the Company adopts the method of real interest rate and makes subsequent measurement according to the cost of amortization. The profits or losses resulting from amortization or impairment are included in current profits and losses. ②Financial assets measured at fair value and changes included in other comprehensive income The Company's business model for managing such financial assets is to collect the contractual cash flow and the contractual cash flow characteristics of such financial assets are consistent with the basic lending arrangements. The Company measures such financial assets at fair value and their changes are included in other comprehensive gains but impairment losses or gains exchange gains and losses and interest income calculated according to the actual interest rate method are included in current profits and losses.In addition the Company designated some non-trading equity instrument investments as financial assets measured at fair value with changes included in other comprehensive income. The Company includes the relevant dividend income of such financial assets in current profits and losses and the changes in fair value in other comprehensive gains. When the financial asset ceases to be recognized the accumulated gains or losses previously included in other comprehensive gains shall be transferred into retained income from other comprehensive income and not be included in current profit and loss. ③Financial assets measured at fair value and changes included in current profits and losses The Company includes the above-mentioned financial assets measured at amortized cost and those measured at fair value and their's changes in financial assets other than financial assets of comprehensive income and classifies them as financial assets measured at fair value and their's changes that are included in current profits and losses. In addition the Company designates some financial assets as financial assets measured at fair value and includes their changes in current profits and losses in order to eliminate or significantly reduce accounting mismatches during initial recognition. In regard with such financial assets the Company adopts fair value for subsequent measurement and includes changes in fair value into current profits and losses. （2）Classification recognition and measurement of financial liabilities The Group’s financial liabilities are on initial recognition classified into financial liabilities at fair value through profit or loss and other financial liabilities. For financial liabilities at fair value through profit or loss relevant transaction costs are immediately recognized in profit or loss for the current period and transaction costs relating to other financial liabilities are included in the initial recognition amounts. 1 Financial liabilities measured by the fair value and the changes recorded in profit or loss The classification by which financial liabilities held-for-trade and financial liabilities designed at the initial recognition to be measured by the fair value follows the same criteria as the classification by which financial assets held-for-trade and financial assets designed at the initial recognition to be measured by the fair value and their changes are recorded in the current profit or loss Transactional financial liabilities (including derivatives belonging to financial liabilities) are subsequently measured according to fair value. Except for hedging accounting changes in fair value are included in current profits and losses. Financial liabilities designated as financial liabilities that are measured at fair value and their's changes are included in current profits and losses. The liabilities are included in other comprehensive gains due to changes in fair value caused by changes in the Company's own credit risk and when the liabilities are terminated the changes in fair value caused by changes in its own credit risk of other comprehensive gains are included in the cumulative changes in its fair value caused by changes in its own credit risk of other comprehensive gains. The amount is transferred to retained earnings. The remaining changes in fair value are included in current profits and losses. If the above-mentioned way of dealing with the impact of the changes in the credit risk of such financial liabilities will result in or expand the accounting mismatch in the profits and losses the Company shall include all the profits or losses of such financial liabilities (including the amount of the impact of the changes in the credit risk of the enterprise itself) into the current profits and losses.② Other financial liabilities In addition to the transfer of a financial asset is not in conformity with the conditions to stop the recognition or formed by its continuous involvement in the transferred financial asset financial liabilities and financial guarantee contract of other financial liabilities classified as financial liabilities measured at the amortized cost measured at the amortized cost for subsequent measurement recognition has been stopped or amortization of the profit or loss is included in the current profits and losses. (3) Recognition basis and measurement methods for transfer of financial assets Financial assets satisfying one of the following conditions shall be terminated and recognized: ① The contractual right to collect the cash flow of the financial asset is terminated; ②The financial asset has been transferred and almost all the risks and rewards in the ownership of the financial asset have been transferred to the transferee; ③The financial asset has been transferred although the enterprise neither transfers nor retains almost all the risks and rewards in the ownership of the financial asset but it abandoned control of the financial assets.In case that the enterprise does not transfer or retain almost all risks and rewards on financial assets ownership nor waive to control these assets relevant financial assets shall be recognized in accordance with the degree for continued involvement of financial assets transferred and relevant liabilities shall be recognized correspondingly. west bank The term "continuous involvement in the transferred financial asset" shall refer to the risk level that the enterprise faces resulting from the change of the value of the financial asset.If the overall transfer of the financial assets satisfies the derecognition criteria the difference between the book value of the transferred financial assets and the sum of the consideration received from transfer and cumulative change in fair value previously recognized in other comprehensive income is accounted into the current profit or loss.In case that the partial transfer of financial assets meets de-recognition conditions the book value of financial assets transferred shall be allocated as per respective fair value between de-recognized or not de-recognized parts and the difference between the sum of the consideration received due to transfer with the accumulated amount of fair value changes that is previously included in other comprehensive income and shall be allocated to de-recognized parts and the aforesaid book amount allocated shall be included in the current profit or loss.The Company shall determine whether almost all the risks and rewards of the ownership of the financial assets sold by means of recourse or endorsed to transfer the financial assets it holds have been transferred. If almost all the risks and rewards in the ownership of the financial asset have been transferred to the transferee the confirmation of the financial asset shall be terminated; if almost all the risks and rewards in the ownership of the financial asset have been retained the confirmation of the financial asset shall not be terminated; if neither the transfer nor the retention of almost all the risks and rewards in the ownership of the financial asset has been made.In case of remuneration it shall continue to determine whether the enterprise has retained control over the assets and conduct accounting treatment in accordance with the principles described in the preceding paragraphs. (4) Termination confirmation of financial liabilities If the current obligation of a financial liability (or part thereof) has been discharged the Company shall terminate the recognition of the financial liability (or part thereof). If the Company (the debtor) signs an agreement with the lender to replace the original financial liabilities by assuming new financial liabilities and the contract terms of the new financial liabilities are substantially different from those of the original financial liabilities it shall terminate the recognition of the original financial liabilities and at the same time confirm a new financial liabilities. If the Company substantially amends the contract terms of the original financial liabilities (or part thereof) it shall terminate the confirmation of the original financial liabilities and at the same time confirm a new financial liabilities in accordance with the revised terms.If the financial liabilities (or part thereof) are terminated the difference between their book value and the consideration paid (including the transferred non-cash assets or liabilities assumed) shall be included in the profits and losses of the current period. （5）Offsetting financial assets and financial liabilities When the Company has a legal right that is currently enforceable to set off the recognized financial assets and financial liabilities and intends either to settle on a net basis or to realize the financial asset and settle the financial liability simultaneously a financial asset and a financial liability shall be offset and the net amount is presented in the balance sheet. Except for the above circumstances financial assets and financial liabilities shall be presented separately in the balance sheet and shall not be offset. (6) Method for determining the fair value of financial assets and financial liabilities Fair value refers to the price that a market participant must pay to sell or transfer a liability in an orderly transaction that occurs on the measurement date. The fair value of financial instruments existing in an active market is determined by the Company according to its quoted price in this market. westbank The quoted prices in the active market refer to the prices which are easily available from the stock exchanges brokers industry associations pricing service institutions and etc. at a fixed term and which represent the prices at which actually occurred market transactions are made under fair conditions.￡¨ In can a financial instrument does not exist in active markets its fair value shall be determined by the Company with assessment techniques. The value appraisal techniques mainly include the prices adopted by the parties who are familiar with the condition in the latest market transaction upon their own free will the current fair value obtained by referring to other financial instruments of the same essential nature the cash flow capitalization method and the option pricing model etc. In valuation the Company adopts valuation techniques that are applicable in the current situation and supported by sufficient data and other information to select input values consistent with the characteristics of assets or liabilities considered by market participants in the transactions of related assets or liabilities and give priority to the use of relevant observable input values as far as possible. Unallowable values are used if the relevant observable input values are not available or are not practicable. （7）Equity instruments An equity instrument is any contract that evidences a residual interest in the assets of the Company after deducting all of its liabilities. The consideration received from issuing equity instruments net of transaction costs are added to shareholders’ equity. All types of distribution (excluding stock dividends) made by the Company to holders of equity instruments are deducted from shareholders’ equity.The dividends (including "interest" generated by the tools classified as equity instruments) distributed by the Company's equity instruments during the period of their existence shall be treated as profit distribution. 11. Impairment of financial instruments The Company requires to confirm that the financial assets lost by impairment are financial assets measured by amortized cost investment in debt instruments and lease receivables which are measured at fair value and whose changes are included in other comprehensive gains mainly including notes receivable accounts receivable other receivables creditor's rights investment other creditor's rights investment and long-term receivables and etc.In addition provision for impairment and confirmation of credit impairment losses are also made for contract assets and some financial guarantee contracts in accordance with the accounting policies described in this section. (1) Method of confirming impairment provision Based on anticipated credit loss the Company calculates impairment preparation and confirms credit impairment loss according to the applicable anticipated credit loss measurement method (general method or simplified method). Credit loss refers to the difference between the cash flow of all contracts discounted according to the original real interest rate and the expected cash flow of all contracts receivable according to the contract that is the present value of all cash shortages. Among them the Company discounts the financial assets purchased or originated with credit impairment at the actual interest rate adjusted by credit.The general method of measuring anticipated credit loss is whether the credit risk of the Company's financial assets (including other applicable items such as contract assets similarly hereinafter) has increased significantly since the initial recognition on each balance sheet day. If the credit risk has increased significantly since the initial recognition the Company shall measure the loss preparation according to the amount equivalent to the expected credit loss in the whole duration. If the credit risk has not increased significantly since the initial recognition the Company shall measure the loss preparation according to the amount equivalent to the expected credit loss in the next 12 months. The Company shall consider all reasonable and evidenced information including forward-looking information when evaluating expected credit losses. Assuming that their credit risk has not increased significantly since the initial recognition the Company may choose to measure the loss reserve according to the expected credit loss in the next 12 months for financial instruments with low credit risk on the balance sheet date. (2) Criteria for judging whether credit risk has increased significantly since the initial recognition If the probability of default of a financial asset on the estimated duration of the balance sheet is significantly higher than the probability of default during the estimated duration of the initial recognition the credit risk of the financial asset is significantly increased. Except for special circumstances the Company uses the change of default risk in the next 12 months as a reasonable estimate of the change of default risk in the entire duration to determine whether the credit risk has increased significantly since the initial recognition. (3) A portfolio-based approach to assessing expected credit risk The Company shall evaluate the credit risk of financial assets with distinct differences in credit risk such as the related party's receivables the receivables in dispute with the other party or involving litigation and arbitration and receivables that has been proved that the debtor may not be able to fulfill the obligation of repayment etc.In addition to the financial assets that assess credit risk individually the Company shall divide financial assets into different groups based on common risk characteristics and assess credit risk on the basis of portfolio. (4) Accounting treatment of impairment of financial assets At the end of the duration the Company shall calculate the anticipated credit losses of various financial assets. If the anticipated credit losses are greater than the book value of its current impairment provision the difference is deemed as impairment loss. If the balance is less than the book value of the current impairment provision the difference is deemed as impairment profit. (5) Method of determining credit losses of various financial assets ①Receivable Account and Contract assets In regard to receivables without significant financing components the Company shall measure loss preparation according to the amount of anticipated credit loss equivalent to the entire duration.In regard to accounts receivable with significant financing components the Company shall choose to measure loss preparation according to the amount equivalent to the expected credit loss within the duration all the time.In addition to the accounts receivable that assesses the credit risk individually receivables are divided into different portfolios based on their credit risk characteristics: Items Basis for determining combination: Protfolio 1：Aging protfolio This portfolio is characterized by the aging of receivables as a credit risk.Portfolio 2 ： Quality Guarantee portfolio This portfolio is the contract quality guarantee fund and other funds For the above portfolio 1 the measurement method of bad debts reserve is the aging analysis method specifically as follows： Aging Proportion （%） Within 1 year（Including 1 year） 0 1-2 years 10 2-3 years 30 3-4 years 50 4-5 years 90 Over 5 years 100 For the guarantee fund portfolio of portfolio 2 no provision for bad debts shall be made unless there is objective evidence that the money cannot be recovered according to the original terms of accounts receivable and contract assets.②Other receivable The Company has measured the impairment loss based on the amount of expected credit losses in the next 12 months or the entire duration based on whether the credit risk of other receivables has increased significantly since the initial recognition. In addition to the other accounts receivable which assesses the credit risk individually they are divided into different portfolios based on their credit risk characteristics: Items Basis for determining combination: Protfolio 1 This portfolio is a collection of various deposits advances pledges and other receivables in daily activities.Protfolio 2 This portfolio is a reserve fund borrowed by employees in their daily business activities.Protfolio 3 Other receivables other than the above portfolio. Combination of deposit quality assurance fund and deposit and reserve fund combination except for objective evidence that the Group will not be able to recover the amount according to the original terms of receivables will not normally be accrued for bad debt reserves. The measurement method of bad debt reserves for other combinations is aging analysis and the accrual proportion is the same as accounts receivable. ③ Creditor's rights investment Creditor's rights investment mainly accounts for bond investment measured by amortized cost etc. The Company has measured the impairment loss based on the amount of expected credit losses in the next 12 months or the entire duration based on whether the credit risk has increased significantly since the initial recognition. The Company adopts the method of evaluating credit risk with individual assets for creditor's rights investment. 12.Inventory 1.Investories class: The company’s stocks can be classified as: raw materials etc. 2. Valuation method of inventory issued :The company calculates the prices of its inventories according to the weighted averages method or the first-in first-out method. (3) Measurement of ending inventory On the balance sheet date inventory shall be measured at the lower of cost and net realizable value. If the cost of inventory is higher than its net realizable value provision for inventory depreciation shall be accrued and recorded into the current profits and losses.If the difference between the cost calculated by a single inventory item and its net realizable value is higher the inventory depreciation reserve shall be accrued and recorded into the current profits and losses. Net realizable value refers to the estimated selling price of inventory in daily activities minus the estimated costs to be incurred upon completion estimated sales expenses and related taxes and fees. 4. Physical inventories are managed by the perpetual inventory taking system. 13.Contract assets The Company lists the customer's unpaid contract consideration for which the Company has fulfilled its performance obligations according to the contract and which is not the right to collect money from customers unconditionally (that is only depending on the passage of time) as a contract asset in the balance sheet. Contract assets and liabilities under the same contract are listed in net amount while contract assets and liabilities under different contracts are not offset.See Note III. 11 Impairment of Financial Instruments for the determination method and accounting treatment method of expected credit loss of contract assets. 14.Contract cost If the incremental cost incurred by the Company for obtaining the contract is expected to be recovered it shall be recognized as an asset as the contract acquisition cost. However if the amortization period of the asset does not exceed one year it will be included in the current profits and losses when it occurs.If the cost incurred for the performance of the contract does not fall within the scope of other accounting standards for business enterprises other than Accounting Standards for Business Enterprises No.14-Revenue (revised in 2017) and meets the following conditions at the same time it will be recognized as an asset as contract performance cost: ① Such cost is directly related to a current or expected contract including direct labor direct materials manufacturing expenses (or similar expenses) costs explicitly borne by customers and other costs incurred only due to the contract. ② Such cost increases the resources of the Company for fulfilling its performance obligations in the future; ③ Such cost is expected to be recovered. Assets related to the contract cost are amortized on the same basis as the recognition of commodity revenue related to the assets and are included in the current profits and losses. 15. Long-term equity investments (1) Initial measurement The Company makes initial measurement of long-term equity investment in the following two situations: ① The initial investment cost of long-term equity investment formed by business combination shall be determined in accordance with the following provisions: A. In a business combination under the same control if the combining party pays cash transfers non-cash assets or assumes debts as the combination consideration the share of the book value of the owner's equity of the merged party in the consolidated financial statements of the final controlling party shall be taken as the initial investment cost of long-term equity investment on the combination date. The difference between the initial investment cost of long-term equity investment and the cash paid the transferred non-cash assets and the book value of the debts undertaken is adopted to adjust the capital reserve; If the capital reserve is insufficient to offset the retained earnings shall be adjusted. All directly related expenses incurred for business combination including audit fees evaluation fees legal service fees etc. are included in the current profits and losses when they occur. B. In the business combination not under the same control the Company determines the combination cost by distinguishing the following situations: a) For business combination realized by one exchange transaction the cost of combination is the fair value of assets paid liabilities incurred or assumed in order to gain control over the purchased party on the purchase date; b) For business combination realized step by step through multiple exchange transactions the sum of the book value of the equity investment of the purchased party held before the purchase date and the new investment cost on the purchase date shall be taken as the initial investment cost of the investment; c) Intermediary expenses such as auditing legal services evaluation and consultation and other related management expenses incurred for business combination are included in the current profits and losses when they occur; d) If future events that may affect the combination cost are agreed in the combination contract or agreement if it is estimated that the future events are likely to occur on the purchase date and the amount of impact on the combination cost can be reliably measured they will be included in the combination cost. ② Except for the long-term equity investment formed by business combination the initial investment cost of long-term equity investment obtained by other means shall be determined in accordance with the following provisions: A. For the long-term equity investment obtained by cash payment the actual purchase price shall be taken as the initial investment cost. Initial investment cost includes expenses taxes and other necessary expenditures directly related to obtaining long-term equity investment. B. For long-term equity investment obtained through exchange of non-monetary assets the initial investment cost shall be determined according to Accounting Standards for Business Enterprises No.7-Exchange of Non-monetary Assets. C. For long-term equity investment obtained through debt restructuring the initial investment cost shall be determined according to Accounting Standards for Business Enterprises No.12-Debt Restructuring.③ No matter how the long-term equity investment is obtained when the investment is obtained the cash dividends or profits included in the paid consideration that have been declared but not yet issued by the investee are separately accounted as receivable items which does not constitute the initial investment cost of obtaining the long-term equity investment. (2) Subsequent measurement Long-term equity investment that can be controlled by the investee shall be accounted by the cost method in individual financial statements. Long-term equity investments that have joint control or significant influence on the investee shall be accounted by equity method.① Long-term equity investment accounted by cost method is priced according to the initial investment cost。 Adjust the cost of long-term equity investment by adding or recovering investment. Cash dividends or profits declared and distributed by the investee shall be recognized as current investment income.If the initial investment cost of long-term equity investment accounted by equity method is greater than the fair value share of identifiable net assets of the investee the initial investment cost of long-term equity investment shall not be adjusted; If the initial investment cost of long-term equity investment is less than the fair value share of the identifiable net assets of the investee at the time of investment the difference shall be included in the current profits and losses and the cost of long-term equity investment shall be adjusted at the same time. After obtaining the long-term equity investment the investment income and other comprehensive income shall be recognized respectively according to the share of the net profit and loss and other comprehensive income realized by the invested unit and the book value of the long-term equity investment shall be adjusted at the same time; According to the profit or cash dividend declared and distributed by the investee the book value of long-term equity investment shall be reduced accordingly; The book value of the long-term equity investment is adjusted and included in the owner's equity for other changes in the owner's equity of the investee except net profit and loss other comprehensive income and profit distribution. When recognizing the share of the net profit and loss of the investee the net profit of the investee is recognized after adjustment based on the fair value of the identifiable net assets of the investee at the time of obtaining the investment. If the accounting policies and accounting periods adopted by the investee are inconsistent with those of the Company the financial statements of the investee shall be adjusted according to the accounting policies and accounting periods of the Company and the investment income and other comprehensive income shall be recognized accordingly. The net loss incurred by the investee is recognized to be written down to zero by the book value of long-term equity investment and other long-term interests that substantially constitute the net investment of the investee unless the Company is obligated to bear additional losses. If the investee achieves net profit in the future the Company will resume the recognition of the revenue sharing amount after its revenue sharing amount compensates for the unrecognized loss sharing amount.When calculating and recognizing the net profit and loss that should be enjoyed or shared by the investee the unrealized internal transaction profit and loss with the affiliated enterprise and the joint venture shall be calculated according to the proportion that should be enjoyed and the part attributable to the Company shall be offset and the investment income shall be recognized on this basis. Unrealized internal transaction losses between the Company and the investee are asset impairment losses which shall be fully recognized. Part of the company's equity investment in affiliated enterprises is indirectly held through venture capital institutions mutual funds trust companies or similar entities including investment-linked insurance funds.Regardless of whether the above entities have a significant impact on this part of investment the Company chooses to measure this part of indirect investment at fair value and its change is included in profit or loss in accordance with the relevant provisions of Accounting Standards for Business Enterprises No.22-Recognition and Measurement of Financial Instruments and the rest is accounted for by equity method.③ When the Company disposes of long-term equity investment the difference between its book value and the actual purchase price shall be included in the current profits and losses. For long-term equity investment accounted by equity method when disposing of the investment it adopts the same basis as the investee's direct disposal of related assets or liabilities and accounts for the part originally included in other comprehensive income according to the corresponding proportion. (3) Basis to determine joint control over and significant influence on the investee Joint control refers to the common control of an arrangement in accordance with the relevant agreement and the relevant activities of such arrangement must be unanimously agreed by the participants who share the control rights before making decisions. Significant influence means that the investor has the right to participate in the decision-making on the financial and operating policies of the investee but cannot control or jointly control the formulation of these policies with other parties. When determining whether the investee can be controlled or exert significant influence the potential voting rights factors such as current convertible bonds and current executable warrants of the investee held by the Company and other parties shall be considered at the same time. 16.Investment Property The measurement mode of investment property The measurement by the cost method Depreciation or amortization method Investment property is held to earn rentals or for capital appreciation or for both. Investment property includes leased or ready to transfer after capital appreciation land use rights and leased buildings. （1）The measurement mode of investment property ①Depreciation or amortization method The estimated service life net salvage value rate and annual depreciation (amortization) rate of investment real estate are listed as follows: Type Estimated service life (years) Estimated net salvage value rate Annual depreciation (amortization) rate Land use right Remaining useful life Houses and buildings 20-30 years 3%-10% 3%-4.85% ② Impairment test method and accounting treatment method See "30. Asset Impairment" for details of impairment test methods and impairment provision accrual methods of investment real estate. (2) Conversion of investment real estate The Company has conclusive evidence that the use of real estate has changed. When converting investment real estate into self-use real estate or inventory the fair value on the day of conversion is taken as the book value of self-use real estate and the difference between fair value and original book value is included in current profits and losses. When self-use real estate or inventory is converted into investment real estate measured by fair value model the investment real estate is priced according to the fair value on the conversion day. If the fair value on the conversion day is less than the original book value the difference is included in the current profits and losses; If the fair value on the conversion date is greater than the original book value the difference shall be included in other comprehensive income. 17.Fixed assets （1）Confirmation conditions The Company's fixed assets refer to tangible assets held for the production of commodities provision of labor services leasing or operation management which have a service life of more than one year and whose economic benefits are likely to be included into the Company and whose costs can be reliably measured.The Company's fixed assets include roads and bridges houses and buildings machinery and equipment electronic equipment transportation tools and other equipment. （2）Depreciation method Type Depreciation method Expected useful life(Year) Residual rate（%） Annual depreciation rate(%) Guangfo Expressway Working flow basis 28 years 0% Fokai Expressway-Xiebian to Sanbao Section Working flow basis 40 years 0% Fokai Expressway-Sanbao to Shuikou Section Working flow basis 30 years 0% Jingzhu Expressway Guangzhu Section Working flow basis 30 years 0% Guanghui Expressway Co. Ltd. Working flow basis 23 years 0% House Building The straight-line method 20-30 years 3%-5% 3.17%-4.85% Machine Equipment The straight-line 3-10 years 3%-5% 9.50%-32.33% method Transportation Equipment The straight-line method 5-8 years 3%-5% 11.88%-19.40% Other The straight-line method 5 years 3%-5% 19.00%-19.40% Except for the fixed assets that have been fully depreciated and continue to be used the depreciation of fixed assets is classified and accrued by the life average method and workload method and the depreciation rate is determined according to the category of fixed assets estimated service life and estimated net salvage value rate. For the fixed assets formed by special reserve expenditure the special reserve shall be offset according to the cost to form the fixed assets and the accumulated depreciation of the same amount shall be recognized. The fixed assets will not be depreciated in future periods. According to the nature and usage of fixed assets the Company determines the service life and estimated net salvage value of fixed assets. At the end of the year the service life estimated net salvage value and depreciation method of fixed assets shall be rechecked and if there is any difference with the original estimate corresponding adjustments shall be made. (3) Identification basis valuation and depreciation method of fixed assets leased by financing When the leased fixed assets have substantially transferred all risks and rewards related to the assets the Company recognizes that the lease of the fixed assets is a financial lease. The cost of fixed assets acquired by finance lease shall be determined according to the lower of the fair value of the leased assets on the lease start date and the present value of the minimum lease payment.The depreciation policy consistent with their own depreciated assets is adopted for fixed assets leased by financing. If it can be reasonably determined that the ownership of the leased asset is acquired at the expiration of the lease term depreciation shall be accrued within the serviceable life of the leased asset; If it is impossible to reasonably determine that the ownership of the leased asset can be acquired at the expiration of the lease term depreciation shall be accrued within the shorter period of the lease term and the serviceable life of the leased asset. 18.Construction-in process The construction in progress of the Company refers to the plant equipment and other fixed assets under construction which are accounted for in detail according to the project and recorded according to the actual cost including direct construction and installation costs and borrowing costs that meet the capitalization conditions.When the construction in progress reaches the scheduled usable state it will be carried over to fixed assets by temporary estimation stop interest capitalization and start to accrue depreciation according to the determined depreciation method of fixed assets. After the project is completed and final accounts are made the original estimated amount will be adjusted according to the amount of final accounts but the original accrued depreciation amount will not be adjusted. 19.Borrowing cost (1) Recognition principle and capitalization period of borrowing cost capitalization Borrowing costs incurred by the Company can be directly attributed to the purchase construction or production of assets that meet the capitalization conditions and shall be capitalized when the following conditions are met at the same time and included in the relevant asset costs: ① Production and expenditure have occurred; ② Borrowing costs have already occurred; ③ The purchase construction or production activities required to make the assets reach the intended usable or saleable state have started. Capitalization of borrowing costs shall be suspended if the assets that meet the capitalization conditions are abnormally interrupted in the process of purchase construction or production and the interruption time continuously exceeds 3 months. Borrowing costs incurred during the interruption period are recognized as expenses and included in the current profits and losses until the purchase and construction of assets or the resumption of production activities. If the interruption is a necessary procedure for the purchased built or produced assets that meet the capitalization conditions to reach the intended usable or saleable state the capitalization of borrowing costs will continue. Capitalization of borrowing costs shall be stopped when assets eligible for capitalization are purchased built or produced to the intended usable or saleable state. Borrowing costs incurred in the future are recognized as expenses in the current period. (2) Calculation method of capitalization amount of borrowing costs Where a special loan is borrowed for the purpose of purchasing building or producing assets that meet the capitalization conditions it shall be determined by deducting the interest income obtained by depositing unused loan funds into the bank from the interest expenses actually incurred in the current period of special loan or by the investment income obtained by temporary investment.If the general loan is occupied for the purpose of purchasing building or producing assets that meet the capitalization conditions the interest amount of the general loan that should be capitalized shall be calculated and determined according to the weighted average of the accumulated asset expenditure exceeding the special loan portion multiplied by the capitalization rate of the occupied general loan. Capitalization rate is calculated and determined according to the weighted average interest rate of general borrowings. 20.Intangible assets (1) Pricing method useful life and impairment test The Company recognizes the identifiable non-monetary assets owned or controlled by the enterprise as intangible assets which have no physical form and the estimated future economic benefits related to the assets are likely to flow into the enterprise and the cost of the assets can be reliably measured.The intangible assets of the Company are recorded according to the amount actually paid or the determined value. (1) If the purchase price of intangible assets exceeds the normal credit conditions which is of financing nature in essence the cost of intangible assets is determined based on the present value of the purchase price. The difference between the actual paid price and the present value of the purchase price shall be included in the current profits and losses within the credit period except that it should be capitalized according to the regulations. (2) The intangible assets invested by investors shall be taken as the cost according to the value agreed in the investment contract or agreement unless the value agreed in the contract or agreement is unfair. (3) The expenditure of internal research and development projects of the Company is divided into research stage expenditure and development stage expenditure. Research refers to an original and planned investigation to acquire and understand new scientific or technical knowledge. Development refers to the application of research results or other knowledge to a plan or design to produce new or substantially improved materials devices and products before commercial production or use. Expenditures during the research phase of internal research and development projects are included in the current profits and losses when they occur. Expenditures in the development stage of internal research and development projects that meet the following conditions are recognized as intangible assets: it is technically feasible to complete the intangible assets so that they can be used or sold; Have the intention to complete the intangible assets and use or sell them; The ways in which intangible assets generate economic benefits including those that can prove that there is a market for products produced by using the intangible assets or that the intangible assets themselves exist in the market and that the intangible assets will be used internally should prove their usefulness; Have sufficient technical financial and other resources to complete the development of the intangible assets and have the ability to use or sell the intangible assets; Expenditures attributable to the development stage of the intangible assets can be measured reliably.Intangible assets with limited service life of the Company shall be amortized on average within the service life since the intangible assets are available for use. Intangible assets with uncertain service life are not amortized.The amortization amount of intangible assets is the amount after deducting the estimated salvage value from its cost. For intangible assets for which impairment provision has been made the accumulated amount of impairment provision for intangible assets has to be deducted.The amortization period of intangible assets with limited service life is as follows: Type Amortization period Land use right Remaining useful life Software 3-5 years Toll road franchises Operating period for residual charges 21. Long-term amortizable expenses Long-term deferred expenses are recorded according to the actual amount incurred and are amortized equally in installments during the benefit period or within the prescribed period. If the long-term prepaid expense item cannot benefit the future accounting period the amortized value of the item that has not been amortized will be transferred to the current profits and losses. 22. Contract liabilities Contract liabilities refer to the obligation of the Group to transfer goods to customers for the received or receivable consideration from customers. If the customer has paid the contract consideration or the Group has obtained the unconditional collection right before the Group transfers the goods to the customer the Group will list the received or receivable amount as the contract liability at the earlier of the actual payment made by the customer and the due date for payment. Contract assets and liabilities under the same contract are listed in net amount while contract assets and liabilities under different contracts are not offset. 23. Employee Benefits Employee compensation refers to various forms of remuneration or compensation given by the Company for obtaining services provided by employees or dissolving labor relations. Employee compensation includes short-term salary post-employment benefits dismissal benefits and other long-term employee benefits. Benefits provided by the Company to spouses children dependents survivors of deceased employees and other beneficiaries of employees are also employee compensation. （1）Accounting methods of short-term benefits During the accounting period when employees provide services the Company recognizes the actual short-term salary as a liability which is included in the current profits and losses except that other accounting standards require or allow it to be included in the cost of assets. (2) Accounting methods for post-employment benefits The Company classifies the post-employment benefit plan into defined contribution plan and defined benefit plans. Post-employment benefit plan refers to the agreement reached between the Company and employees on post-employment benefits or the rules or measures formulated by the Company to provide post-employment benefits to employees among which the set deposit plan refers to the post-employment welfare plan in which the Company no longer undertakes further payment obligations after paying a fixed fee to an independent fund; Defined benefit plans refers to the post-employment benefit plan except the set-up deposit plan. (3) Accounting Treatment Method of Demission Welfare If the Company provides dismissal benefits to employees the employee compensation liabilities arising from the dismissal benefits shall be recognized as soon as possible and included in the current profits and losses: when the company cannot unnaturally withdraw the dismissal benefits provided by the termination of labor relations plan or reduction proposal; when the Company recognizes the costs or expenses related to the reorganization involving the payment of dismissal benefits. （4）Other long-term employee benefits If other long-term employee benefits provided by the Company to employees meet the conditions of the set deposit plan they shall be handled according to the accounting policies of the set deposit plan mentioned above; Otherwise the net liabilities or net assets of other long-term employee benefits shall be recognized and measured in accordance with the accounting policies of defined benefit plans mentioned above. 24.Estimated liabilities (1) Recognition criteria of estimated liabilities If the obligations related to contingencies stipulated by the Company meet the following conditions at the same time they are recognized as estimated liabilities: ① The obligations are the current obligations undertaken by the enterprise; ② Fulfilling the obligations is likely to cause economic benefits to flow out of the enterprise; ③ The amount of the obligations can be measured reliably. (2) Measurement method of estimated liabilities Estimated liabilities are initially measured according to the best estimate of expenditure required to fulfill relevant current obligations. There is a continuous range of required expenditure and the possibility of occurrence of various results in this range is the same and the best estimate is determined according to the intermediate value in this range. In other cases the best estimates are treated as follows: ① Contingencies involving a single item shall be determined according to the most probable amount. ② Contingencies involving multiple items shall be calculated and determined according to various possible results and relevant probabilities.When determining the best estimate the risk uncertainty and time value of money related to contingencies shall be considered comprehensively. If the time value of money has great influence the best estimate is determined by discounting the related future cash outflow.If all or part of the expenses required by the Company to pay off the estimated liabilities are expected to be compensated by a third party the compensation amount can be recognized as an asset only when it is basically confirmed that it can be received. The recognized compensation amount shall not exceed the book value of the estimated liabilities.The Company rechecks the book value of the estimated liabilities on the balance sheet date. If there is conclusive evidence that the book value cannot truly reflect the current best estimate the book value shall be adjusted according to the current best estimate. 25. Revenues Accounting policies adopted for income recognition and measurement (1) Revenue recognition principle Since the starting date of the contract the company shall evaluate the contract identifies each individual performance obligation contained in and determines whether each individual performance obligation is performed within a certain period of time or at a certain point of time.The performance obligation is defined as fulfillment within a certain period of time if one of the following conditions is met otherwise it is defined as fulfilled at a certain point in time: ① The customer obtains and consumes the economic benefits brought by the company's performance while the company performs the contract; ② The customer can control the goods under manufacturing or services during the company's performance; ③ The goods or services produced during the company's performance have irreplaceable uses and the company has the right to accumulate for the completed performances during the entire contract period. For obligations performed within a certain period of time the company recognizes revenue in accordance with the performance progress in that period. If the performance progress cannot be reasonably determined and the cost incurred is expected to be compensated the revenue shall be recognized according to the amount of the cost incurred until the performance progress can be reasonably determined. For obligations performed at a certain point in time revenue shall be recognized at the point when the customer obtains control of the relevant goods or services. When judging whether the customer has obtained control of the product the company shall consider the following points: ① The company has the current right to receive payment for the product that is the customer has the current payment obligation for the product; ② The company has transferred the legal ownership of the product to the customer that is the customer has the legal ownership of the product; ③ The company has transferred the physical product to the customer that is the customer has physically taken possession of the product; ④ The company has transferred the main risks and rewards on the ownership of the product to the customer that is the customer has obtained the main risks and rewards on the ownership of the product; ⑤ The customer has accepted the product; ⑥ Other signs that the customer has obtained control of the product. (2) Principle of revenue measurement ① The company shall measure revenue based on the transaction price allocated to each individual performance obligation. The transaction price is the amount of consideration that the company expects to be entitled to receive due to the transfer of goods or services to customers while does not include payments received on behalf of third parties and payments expected to be returned to customers.② If there is variable consideration in the contract the company shall determine its best estimate according to the expected value or the most likely amount but the transaction price including the variable consideration shall not exceed the accumulated amount that if relevant uncertainty is eliminated will most likely have no significant reversal.③ If there is any significant financing component in the contract the company shall determine the transaction price based on the amount payable in cash when the customer assumes control of the goods or services.The difference between transaction price and contract consideration shall be amortized through effective interest method during the contract period. On the starting date of contract if the company expects that the customer will obtain control of the goods or services and pays the price within one year the significant financing component in contract shall not be considered.④ If the contract contains two or more performance obligations the company shall on date of the contract allocate the transaction price to each individual obligation item in accordance with the relative proportion of the separate selling price of promised goods.The adoption of different business models in similar businesses leads to differences in accounting policies for revenue recognition (3) Specific methods of revenue recognition (1) Toll service fee income The toll income of roads and bridges is determined according to the amount collected and receivable by vehicles when passing through. (2) Income from providing labor services For services started and completed in the same fiscal year income is recognized when the services are completed. If the beginning and completion of labor services belong to different fiscal years the Company shall on the balance sheet date recognize the related labor income by the percentage of completion method provided that the result of the labor service transaction can be reliably estimated. When the following conditions can be satisfied the results of the transaction can be reliably estimated: ① the total income and total cost of labor services can be reliably measured; ② the economic benefits related to the transaction can flow into the enterprise; ③ the degree of completion of labor services can be reliably determined. For services started and completed in the same fiscal year income is recognized when the services are completed. If the beginning and completion of labor services belong to different fiscal years the Company shall on the balance sheet date recognize the related labor income by the percentage of completion method provided that the result of the labor service transaction can be reliably estimated. When the following conditions can be satisfied the results of the transaction can be reliably estimated: ① the total income and total cost of labor services can be reliably measured; ② the economic benefits related to the transaction can flow into the enterprise; If the transaction result of providing labor services on the balance sheet date cannot be estimated reliably the following situations shall be dealt with respectively: ① If the labor cost already incurred is expected to be compensated the income from the service shall be recognized according to the amount of the labor cost already incurred and the labor cost shall be carried over at the same amount.② If the incurred labor cost is not expected to be compensated the incurred labor cost shall be included in the profits and losses of the current period and the income from the provision of labor service shall not be recognized.When the contracts or agreements signed between the Company and other enterprises include selling goods and providing services if the part for selling goods and the part for providing services can be distinguished and measured separately the part for selling goods will be treated as goods sales and the part for providing services will be treated as service provision. Sales of goods and services can not be distinguished or although they can be distinguished they can not be measured separately. All parts for the selling goods and providing services will be treated as sales of goods.The adoption of different business models in similar businesses leads to differences in accounting policies for income recognition 26. Government Grants Government subsidies are recognized when they meet the conditions attached to government subsidies and can be received.Government subsidies for monetary assets shall be measured according to the amount received or receivable.Government subsidies for non-monetary assets are measured at fair value; If the fair value cannot be obtained reliably it shall be measured according to the nominal amount of 1 yuan.Government subsidies related to assets refer to government subsidies obtained by the Company for purchasing and building or forming long-term assets in other ways; Otherwise as a government subsidy related to income.Where the government documents do not specify the object of the subsidy and the subsidy can form long-term assets the part of the government subsidy corresponding to the value of the assets shall be regarded as the government subsidy related to the assets and the rest shall be regarded as the government subsidy related to the income; Where it is difficult to be distinguished government subsidies as a whole are treated as income-related government subsidies.Government subsidies related to assets offset the book value of related assets or are recognized as deferred revenue and included in profits and losses by stages according to a reasonable and systematic method within the service life of related assets. Government subsidies related to income which are used to compensate related costs or losses that have occurred shall be included in current profits and losses or offset related costs; If they are used to compensate related costs or losses in later periods they will be included in the deferred revenue and they will be included in the current profits and losses or offset related costs during the recognition period of related costs or losses. Government subsidies measured in nominal amount are directly included in current profits and losses. The Company adopts a consistent approach to the same or similar government subsidy business. Government subsidies related to daily activities according to the essence of economic business are included in other income or offset related costs. Government subsidies irrelevant to routine activities shall be included into the non-operating receipt and disbursement.When the recognized government subsidy needs to be returned if the book value of related assets is offset during initial recognition the book value of assets will be adjusted; If there is a relevant deferred revenue balance the book balance of the relevant deferred revenue will be offset and the excess will be included in the current profits and losses; In other cases it is directly included in the current profits and losses. For the discount interest of preferential policy loans if the finance allocates the discount interest funds to the lending bank the actually received loan amount is taken as the recorded value of the loan and the borrowing cost is calculated according to the loan principal and preferential policy interest rate. If the finance directly allocates the discount interest funds to the Company the discount interest will offset the borrowing costs. 27.Deferred income tax assets and deferred income tax liabilities The Company adopts the balance sheet liability method for income tax accounting treatment. (1) Deferred tax assets ① If there is a deductible temporary difference between the book value of an asset or liability and its tax basis the deferred income tax assets generated by the deductible temporary difference shall be calculated and confirmed according to the applicable tax rate during the expected period of recovering the asset or paying off the liability.② On the balance sheet date if there is conclusive evidence that sufficient taxable income is likely to be obtained in the future period to offset the deductible temporary difference the unrecognized deferred income tax assets in the previous period shall be recognized.③ On the balance sheet date the book value of deferred income tax assets shall be reviewed. If it is unlikely that enough taxable income will be obtained in the future period to offset the benefits of deferred income tax assets the book value of deferred income tax assets will be written down. When sufficient taxable income is likely to be obtained the written-down amount will be reversed. (2) Deferred income tax liabilities If there is a taxable temporary difference between the book value of assets and liabilities and their tax basis the deferred income tax liabilities arising from the taxable temporary difference shall be recognized according to the applicable tax rate during the expected period of recovering the assets or paying off the liabilities. 28.Lease (1) Accounting methods for operating leases As the lessee the Company's operating lease rent is included in the relevant asset cost or current profit and loss according to the straight-line method in each period of the lease term; The initial direct expenses incurred are included in the current profits and losses; Contingent rents are included in current profits and losses when they actually occur. As the lessor the Company includes the assets used as operating leases in the relevant items in the balance sheet according to the nature of the assets; For the rent of operating lease it is recognized as the current profit and loss according to the straight-line method in each period of the lease term; The initial direct expenses incurred are included in the current profits and losses; For the fixed assets in the operating lease assets the depreciation policy of similar assets is adopted for depreciation; For other operating lease assets a systematic and reasonable method is adopted for amortization; Contingent rents are included in current profits and losses when they actually occur. (2) Accounting methods for financial leasing ① As the lessee On the start date of the lease term the Company takes the lower of the fair value of the leased assets on the lease start date and the present value of the minimum lease payment as the recorded value of the leased assets and the minimum lease payment as the recorded value of the long-term payables with the difference as the unrecognized financing expenses; Initial direct expenses such as handling fees attorney fees travel expenses stamp duty etc. which occur during the lease negotiation and signing of the lease contract are included in the value of the leased assets; Unrecognized financing expenses are allocated in each period of the lease term and the current financing expenses are calculated and recognized by the effective interest rate method; Contingent rents are included in current profits and losses when they actually occur.When calculating the present value of the minimum lease payment if the lessor's lease inclusive interest rate can be obtained the lease inclusive interest rate shall be used as the discount rate; Otherwise the interest rate stipulated in the lease contract shall be used as the discount rate. If the lessor's lease interest rate cannot be obtained and the lease contract does not stipulate the interest rate the bank loan interest rate of the same period shall be used as the discount rate.The Company adopts the depreciation policy consistent with that of the self-owned fixed assets to withdraw the depreciation of the leased assets. If it can be reasonably determined that the ownership of the leased asset is acquired at the expiration of the lease term depreciation shall be accrued within the service life of the leased asset.If it is impossible to reasonably determine that the ownership of the leased asset can be acquired at the expiration of the lease term depreciation shall be accrued within the shorter period of the lease term and the service life of the leased asset. ② As the lessor On the start date of the lease term the Company shall take the sum of the minimum lease receipt amount and the initial direct expenses on the lease start date as the recorded value of the financial lease receivable and records the unsecured residual value; Recognize the difference between the sum of the minimum lease payment amount initial direct expenses and unsecured residual value and its present value as unrealized financing income; Distribute unrealized financing income in each period of the lease term; Calculate and confirm the financing income of the current period by using the effective interest rate method; And include contingent rents in current profits and losses when they actually occur. 29. Held-for-sale non-current assets disposal group and termination of operation (1) Classification and measurement of held-for-sale non-current assets or disposal groups When the book value is recovered mainly by selling (including the exchange of non-monetary assets with commercial substance) rather than continuously using a non-current asset or disposal group the non-current asset or disposal group is classified as held for sale.The above-mentioned non-current assets do not include investment real estate measured by fair value model biological assets measured by net amount of fair value minus selling expenses assets formed by employee compensation financial assets deferred income tax assets and rights arising from insurance contracts. The disposal group refers to a group of assets disposed of together by sale or other means in a transaction as a whole and liabilities directly related to these assets transferred in the transaction. Under certain circumstances the disposal group includes goodwill obtained in business combination etc. At the same time non-current assets or disposal groups that meet the following conditions are classified as held for sale: according to the practice of selling such assets or disposal groups in similar transactions the non-current assets or disposal groups can be sold immediately under the current situation; The sale is very likely to happen that is a resolution has been made on a sale plan and a firm purchase commitment has been obtained and it is expected that the sale will be completed within one year. If the control over subsidiaries is lost due to the sale of investments in subsidiaries whether or not the Company retains part of the equity investments after the sale when the investment in subsidiaries to be sold meets the classification conditions of held-for-sale the investment in subsidiaries will be classified as held-for-sale as a whole in individual financial statements and all assets and liabilities of subsidiaries will be classified as held-for-sale in consolidated financial statements.When the non-current assets or disposal groups held for sale are initially measured or re-measured on the balance sheet date the difference between the book value and the net amount after deducting the selling expenses from the fair value is recognized as the asset impairment loss. For the amount of asset impairment loss recognized for the held-for-sale disposal group the book value of goodwill in the disposal group is offset first and then the book value of non-current assets in the disposal group is offset proportionally.If the net amount of non-current assets held for sale or disposal group's fair value minus selling expenses increases on the subsequent balance sheet date the previously written-down amount will be restored and reversed within the amount of asset impairment loss recognized after being classified as held-for-sale and the reversed amount will be included in the current profits and losses. The book value of offset goodwill shall not be reversed.Non-current assets held for sale and assets in disposal group held for sale are not depreciated or amortized; Interest and other expenses of liabilities in disposal group held for sale continue to be recognized. All or part of the investments of affiliated enterprises or joint ventures classified as held-for-sale shall be accounted for by the equity method for those classified as held for sale while those retained (not classified as held-for-sale) shall continue to be accounted for by the equity method; When the Company loses significant influence on the affiliated enterprise and joint venture due to the sale it shall stop using the equity method.If a certain non-current asset or disposal group is classified as held for sale but the classification conditions of held for sale are no longer met the Company will stop classifying it as held for sale and measure it according to the lower of the following two amounts: ① For the book value of the asset or disposal group before it is classified as held for sale the amount adjusted according to the depreciation amortization or impairment which should have been recognized without being classified as held for sale; ② Recoverable amount. (2) Termination of operation Termination of operation refers to the components that have been disposed of by the Company or classified as held for sale by the Company and can be distinguished separately which meet one of the following conditions: ① This component represents an independent main business or a separate main business area.② This component is part of an associated plan to dispose of an independent main business or a separate main business area.③ This component is a subsidiary acquired for resale. (3) Presentation In the balance sheet the Company lists the non-current assets held for sale or the assets in the disposal group held for sale as "assets held for sale" and lists the liabilities in the disposal group held for sale as "liabilities held for sale".The Company separately lists the profit and loss from continuing operations and the profit and loss from termination of operations in the income statement. For non-current assets or disposal groups held for sale that do not meet the definition of termination of operation the impairment loss reversal amount and disposal profit and loss are listed as the profit and loss of continuing operations. Operating profit and loss and disposal profit and loss such as impairment loss and reversal amount of discontinued operation are listed as discontinued operation profit and loss. A disposal group that intends to terminate its use instead of selling and meets the conditions of relevant components in the definition of operation termination shall be listed as operation termination from the date when it ceases to use. For the discontinued operations listed in the current period in the current financial statements the information originally listed as the profit and loss of continuing operations is re-listed as the profit and loss of discontinued operations in the comparable accounting period. If the termination of operation no longer meets the classification conditions for held-for-sale the information originally listed as the profit and loss of operation termination in the current financial statements will be listed again as the profit and loss of continuing operation in the comparable accounting period. 30. Impairment of assets The following signs indicate that the assets may be impaired: (1) The market price of assets fell sharply in the current period which was significantly higher than the expected decline due to the passage of time or normal use. (2) The economic technical or legal environment in which the Company operates and the market in which the assets are located have undergone major changes in the current period or in the near future which will have adverse effects on the Company. (3) The market interest rate or other market return on investment has increased in the current period which affects the discount rate used by enterprises to calculate the present value of the estimated future cash flow of assets resulting in a significant decrease in the recoverable amount of assets. (4) There is evidence that the assets are outdated or their entities have been damaged. (5) Assets have been or will be idle terminated or planned to be disposed of in advance. (6) The evidence reported by the company shows that the economic performance of assets has been or will be lower than expected such as the net cash flow created by assets or the realized operating profit (or loss) is far lower than the expected amount. (7) Other indications that assets may have been impaired. On the balance sheet date the Company judges various assets that are applicable to the Accounting Standards for Business Enterprises No.8-Impairment of Assets such as long-term equity investment fixed assets engineering materials construction in progress intangible assets (except those with uncertain service life) and conducts impairment test when there are signs of impairment-estimating their recoverable amount. The recoverable amount is determined by the higher of the net amount of the fair value of the asset minus the disposal expenses and the present value of the estimated future cash flow of the asset. If the recoverable amount of an asset is lower than its book value the book value of the asset shall be written down to the recoverable amount and the written-down amount shall be recognized as the asset impairment loss which shall be included in the current profits and losses and the corresponding asset impairment reserve shall be accrued at the same time.If there are signs that an asset may be impaired the Company usually estimates its recoverable amount on the basis of individual assets. When it is difficult to estimate the recoverable amount of a single asset the recoverable amount of the asset group is determined based on the asset group to which the asset belongs. Asset group is the smallest asset portfolio that can be recognized by the Company and its cash inflow is basically independent of other assets or asset groups. The asset group consists of assets related to cash inflow. The identification of asset group is based on whether the main cash inflow generated by asset group is independent of other assets or cash inflow of asset group.The Company conducts impairment test every year for intangible assets with uncertain goodwill and service life formed by business combination and not yet in serviceable condition regardless of whether there is any sign of impairment. The impairment test of goodwill is carried out in combination with its related asset group or combination of asset groups.Once the asset impairment loss is confirmed it will not be reversed in the following accounting period. 31. Fair value measurement Fair value refers to the price that a market participant must pay to sell or transfer a liability in an orderly transaction that occurs on the measurement date.The Company measures related assets or liabilities at fair value assuming that the orderly transaction of selling assets or transferring liabilities is conducted in the main market of related assets or liabilities; If there is no major market the Company assumes that the transaction will be conducted in the most favorable market of related assets or liabilities. The main market (or the most favorable market) is the trading market that the Company can enter on the measurement day. The Company adopts the assumptions used by market participants to maximize their economic benefits when pricing the assets or liabilities.When measuring non-financial assets at fair value the ability of market participants to use the assets for the best purpose to generate economic benefits or the ability to sell the assets to other market participants for the best purpose to generate economic benefits shall be considered.The Company adopts the valuation technology which is applicable in the current situation and supported by sufficient available data and other information and gives priority to the relevant observable input values and only uses the unobservable input values when the observable input values are unavailable or impractical. For assets and liabilities measured or disclosed at fair value in financial statements it shall determine the fair value level according to the lowest level input value which is of great significance to fair value measurement as a whole: the first-level input value is the unadjusted quotation of the same assets or liabilities that can be obtained on the measurement date in an active market; The second-level input value is directly or indirectly observable input values of related assets or liabilities except the first-level input value; The third level input value is the unobservable input value of related assets or liabilities.On each balance sheet date the Company reassesses the assets and liabilities recognized in the financial statements that are continuously measured at fair value to determine whether there is a conversion between the fair value measurement levels. 32.Change of main accounting policies and estimations (1)Change of main accounting policies √Applicable □ Not applicable Contents and causes for changes of accounting policy Approval procedures Remarks On July 5 2017 the Ministry of Finance issued the Accounting Standards for Business Enterprises No.14-Income (Revised in 2017) (CK [2017] No.22) (hereinafter referred to as the "New Income Standards").It was adopted at the 4th meeting of the 9th Board of Directors of the Company on April 3 2020 The New Income Standards establish a new income recognition model for regulating the income generated by contracts with customers.In order to implement the new revenue standard the Company re-evaluated the recognition measurement accounting and presentation of main contract income. According to the new income standards only the cumulative impact of unfinished contracts on January 1 2020 are adjusted. The accumulated impact amount of the first implementation is adjusted. The amount of retained earnings at the beginning of the first implementation period (i.e. January 1 2020) and other related items in the financial statements will not be adjusted for the information of comparable periods.Influence of implementing new income standards on financial statements on January 1 2020: Items December 312019（Before change） January 12020（After change） Consolidated statements Consolidated statements Account receivable 177099124.09 179449777.42 Other account receivable 30103478.60 22706427.50 Contract assets 5046397.77 Inventories 111683.22 111683.22 Other Non-current assets 50909325.73 50909325.73 Advance receipts 15605094.69 12817484.06 Contract liabilities 2787610.63 （2）Significant estimates changes √ Applicable □ Not applicable Contents and causes of changes in accounting estimates Approval procedure Time point at which the application begins Remarks From January 1 2020 the Traffic Volume Forecast and Charge Revenue Report of Fokai Expressway and the Traffic Volume Forecast and Charge Revenue On December 31 2019 the third (provisional) meeting of the ninth board of directors was held and the meeting January 12020 For this matter the company adopts the future applicable method. This change in accounting estimate results in a decrease in depreciation of fixed assets in the current period than the original Report of Guangzhu Section of Jiangzhu Expressway issued by Guangdong Transportation Planning and Design Institute Co.Ltd. in 2019 for the Fokai Branch of Guangdong Expressway Development Co. Ltd. a branch of the Company and Jingzhu Expressway Guangzhu Section Co. Ltd. a holding subsidiary are used as depreciation basis passed the Proposal on Changes in Accounting Estimates accounting estimate by RMB 172308077.27 a decrease in operating cost by RMB 172308077.27 AN increase in net profit by RMB 129231057.95 an increase in net profit attributable to shareholders of the parent company by RMB 123155223.57 and an increase in impact of profit and loss attributable to minority shareholders by RMB 6075834.39.、 From September 1 2020 the depreciation period of machinery and equipment electronic equipment and other equipment has been changed and the net salvage value rate of fixed assets (except road property) has also been changed. On August 26 2020 the 9th (provisional) meeting of the ninth board of directors was held and the meeting passed the Proposal on Changes in Accounting Estimates September 12020 For this matter the company adopts the future applicable method. This change in accounting estimate results in a decrease in depreciation of fixed assets in the current period than the original accounting estimate by RMB 33759072.50 an Increase in operating cost by RMB 33759072.50 A decrease in net profit by RMB 25319304.38 a decrease in net profit attributable to shareholders of the parent company by RMB 24086113.34 and a decrease in impact of profit and loss attributable to minority shareholders by RMB 1233191.05. （3）Adjustments to the Financial Statements at the Beginning of the First Execution Year of any New Standards Governing Financial Instruments Revenue or Leases from year 2020 Applicable Whether need to adjust the balance sheet account at the beginning of the year √ Yes □No Consolidated balance sheet In RMB Items December 312019 January 12020 Amount involved in the adjustment Current asset： Monetary fund 3054198364.15 3054198364.15 Settlement provision Outgoing call loan Items December 312019 January 12020 Amount involved in the adjustment Transactional financial assets Derivative financial assets Notes receivable Account receivable 177099124.09 179449777.42 2350653.33 Financing of receivables Prepayments 11829452.88 11829452.88 Insurance receivable Reinsurance receivable Provisions of Reinsurance contracts receivable Other account receivable 30103478.60 22706427.50 -7397051.10 Including：Interest receivable Dividend receivable 7205472.90 7205472.90 Repurchasing of financial assets Inventories 111683.22 111683.22 Contract assets 5046397.77 5046397.77 Assets held for sales Non-current asset due within 1 year 51745.32 51745.32 Other current asset 196576603.21 196576603.21 Total of current assets 3469970451.47 3469970451.47 Non-current assets Loans and payment on other’s behalf disbursed Debt investment Other investment on bonds Long-term receivable Long term share equity investment 2207266324.84 2207266324.84 Other equity instruments investment 1835822604.77 1835822604.77 Other non-current financial assets Property investment 3331500.37 3331500.37 Fixed assets 12460188469.66 12460188469.66 Construction in progress 241274698.97 241274698.97 Production physical assets Items December 312019 January 12020 Amount involved in the adjustment Oil & gas assets Use right assets Intangible assets 8762039.52 8762039.52 Development expenses Goodwill Long-germ expenses to be amortized 3919764.44 3919764.44 Deferred income tax asset 385494106.13 385494106.13 Other non-current asset 50909325.73 50909325.73 Total of non-current assets 17196968834.43 17196968834.43 Total of assets 20666939285.90 20666939285.90 Current liabilities Short-term loans Loan from Central Bank Borrowing funds Transactional financial liabilities Derivative financial liabilities Notes payable Account payable 368307598.41 368307598.41 Advance receipts 15605094.69 12817484.06 -2787610.63 Contract liabilities 2787610.63 2787610.63 Selling of repurchased financial assets Deposit taking and interbank deposit Entrusted trading of securities Entrusted selling of securities Employees’ wage payable 15173142.46 15173142.46 Tax payable 175201627.19 175201627.19 Other account payable 474689554.26 474689554.26 Including：Interest payable Dividend payable 20020119.31 20020119.31 Fees and commissions payable Reinsurance fee payable Liabilities held for sales Items December 312019 January 12020 Amount involved in the adjustment Non-current liability due within 1 year 796246790.61 796246790.61 Other current liability 1246636.74 1246636.74 Total of current liability 1846470444.36 1846470444.36 Non-current liabilities： Reserve fund for insurance contracts Long-term loan 4926015000.00 4926015000.00 Bond payable 678124972.89 678124972.89 Including：preferred stock Sustainable debt Lease liability Long-term payable 39369379.91 39369379.91 Long-term remuneration payable to staff Expected liabilities Deferred income 51000000.00 51000000.00 Deferred income tax liability 428922140.08 428922140.08 Other non-current liabilities Total non-current liabilities 6123431492.88 6123431492.88 Total of liability 7969901937.24 7969901937.24 Owners’ equity Share capital 2090806126.00 2090806126.00 Other equity instruments Including：preferred stock Sustainable debt Capital reserves 3094017129.31 3094017129.31 Less：Shares in stock Other comprehensive income 382193344.90 382193344.90 Special reserve Surplus reserves 1074553052.81 1074553052.81 Common risk provision Retained profit 3915790810.76 3915790810.76 Total of owner’s equity belong to the 10557360463.78 10557360463.78 Items December 312019 January 12020 Amount involved in the adjustment parent company Minority shareholders’ equity 2139676884.88 2139676884.88 Total of owners’ equity 12697037348.66 12697037348.66 Total of liabilities and owners’ equity 20666939285.90 20666939285.90 Adjustment statement Parent Company Balance Sheet In RMB Items December 312019 January 12020 Amount involved in the adjustment Current asset： Monetary fund 2791384501.78 2791384501.78 Transactional financial assets Derivative financial assets Notes receivable Account receivable 21864051.27 21864051.27 Financing of receivables Prepayments 1737598.88 1737598.88 Other account receivable 13435651.19 13435651.19 Including：Interest receivable Dividend receivable 7205472.90 7205472.90 Inventories Contract assets Assets held for sales Non-current asset due within 1 year 151637139.08 151637139.08 Other current asset Total of current assets 2980058942.20 2980058942.20 Non-current assets： Debt investment 537903684.98 537903684.98 Other investment on bonds Long-term receivable Long term share equity investment 4789404907.17 4789404907.17 Items December 312019 January 12020 Amount involved in the adjustment Other equity instruments investment 1835822604.77 1835822604.77 Other non-current financial assets Property investment 3079362.12 3079362.12 Fixed assets 6818701482.08 6818701482.08 Construction in progress 46952925.08 46952925.08 Production physical assets Oil & gas assets Use right assets Intangible assets 2533878.12 2533878.12 Development expenses Goodwill Long-germ expenses to be amortized Deferred income tax asset 385296935.33 385296935.33 Other non-current asset 36901029.57 36901029.57 Total of non-current assets 14456596809.22 14456596809.22 Total of assets 17436655751.42 17436655751.42 Current liabilities Short-term loans Transactional financial liabilities Derivative financial liabilities Notes payable Account payable 129930285.56 129930285.56 Advance receipts Contract Liabilities Employees’ wage payable 6340740.61 6340740.61 Tax payable 8704510.83 8704510.83 Other account payable 582131356.01 582131356.01 Including：Interest payable Dividend payable 20020119.31 20020119.31 Liabilities held for sales Non-current liability due within 1 year 744589133.72 744589133.72 Other current liability 821133339.57 821133339.57 Items December 312019 January 12020 Amount involved in the adjustment Total of current liability 2292829366.30 2292829366.30 Non-current liabilities： Long-term loan 4243730000.00 4243730000.00 Bond payable 678124972.89 678124972.89 Including：preferred stock Sustainable debt Lease liability Long-term payable 39369379.91 39369379.91 Long-term remuneration payable to staff Expected liabilities Deferred income Deferred income tax liability 129978356.56 129978356.56 Other non-current liabilities Total non-current liabilities 5091202709.36 5091202709.36 Total of liability 7384032075.66 7384032075.66 Owners’ equity Share capital 2090806126.00 2090806126.00 Other equity instruments Including：preferred stock Sustainable debt Capital reserves 2974458696.93 2974458696.93 Less：Shares in stock Other comprehensive income 382193344.90 382193344.90 Special reserve Surplus reserves 894580785.25 894580785.25 Retained profit 3710584722.68 3710584722.68 Total of owners’ equity 10052623675.76 10052623675.76 Total of liabilities and owners’ equity 17436655751.42 17436655751.42 Note （4）Retrospective Restatement of Previous Comparative Data due to the First Execution of any New Standards Governing Financial Instruments or Leases from year 2020 □ Applicable √ Not applicable VI. Taxation 1. Major category of taxes and tax rates Tax category Tax basis Tax rate VAT Taxable income 3%，5%，6%，9%，13% City maintenance and construction tax The actual payment of turnover tax 7%，5% Enterprise income tax Taxable income 25% Education Fee Surcharge The actual payment of turnover tax 3% Local education surcharge The actual payment of turnover tax 2% 2.Preferential tax According to the Notice of the Ministry of Finance and the State Administration of Taxation on Fully Opening the Pilot of Changing Business Tax to VAT (CS [2016] No.36) the qualified contract energy management services of the subsidiary Guangdong High-speed Technology Investment Co. Ltd. are exempt from VAT. VII. Notes to the major items of consolidated financial statement Unless otherwise specified in the following notes (including the notes to main items in the financial statements of the parent company) "the beginning of the period" refers to January 1 2020 "the end of the period" refers to December 31 2020 "current period" refers to Year 2020 and "last period" refers to Year 2019. 1.Monetary Capital In RMB Items Amount in year-end Balance Year-beginning Cash 54482.68 75833.29 Bank deposit 2846821352.23 3052884045.33 Other 522168.98 1238485.53 Total 2847398003.89 3054198364.15 Other note On December 312020The balance of restricted bank deposits at the end of the period was 1221200.00 yuan which was the land reclamation fund deposited into the fund custody account for the reconstruction and expansion project of Sanbao to Shuikou section of Fokai Expressway. 2020 Annual Report 2. Account receivable 1.Classification account receivables. In RMB Category Amount in year-end Balance Year-beginning Book Balance Bad debt provision Book value Book Balance Bad debt provision Book valueAmount Proportion(%) Amount Propor tion(% ) Amount Proportion (%) Amount Proportion( %) Of which： Accrual of bad debt provision by portfolio 172621378.99 100.00% 3713861.43 2.15% 168907517.56 180802658.14 100.00% 1352880 .72 0.75% 179449777.42 Of which： Aging portfolio 171846750.22 99.55% 3713861.43 2.16% 168132888.79 179305712.71 99.17% 1352880 .72 0.75% 177952831.99 Quality guarantee portfolio 774628.77 0.45% 774628.77 1496945.43 0.83% 1496945.43 Total 172621378.99 3713861.43 168907517.56 180802658.14 1352880 .72 179449777.42 ①Accrual of bad debt provision by single：None ②Accrual of bad debt provision by portfolio：Accrual of bad debt provision by aging portfolio In RMB Name Balance in year-end Book balance Bad debt provision Withdrawal proportion Within 1 year 155744121.98 0.00% 1-2 years 6216340.00 517764.40 10.00% 2-3 years 9303445.25 2684406.38 30.00% 3-4 years 75000.00 37500.00 50.00% 4-5 years 336523.39 302871.05 90.00% Over 5 years 171319.60 171319.60 100.00% Total 171846750.22 3713861.43 -- Note of the basis of recognizing the portfolio: Provision for bad debts according to the age portfolio ③Accrual of bad debt provision by portfolio: Notes of the basis of Quality guarantee the group In RMB Name Balance in year-end Book balance Bad debt provision Withdrawal proportion Quality guarantee 774628.77 0.00% Total 774628.77 -- Notes of the basis of recognizing the portfolio: Provision for bad debts according to Quality guarantee portfolio Relevant information of the provision for bad debts will be disclosed with reference to the disclosure method of other receivables if the provision for bad debts of bills receivable is accrued according to the general model of expected credit loss: □Applicable √Not applicable Disclosure by aging In RMB Aging Closing balance Within 1 year（Including 1 year） 155744121.98 1-2 years 6247640.00 2-3 years 9410005.85 Over 3 years 1219611.16 3-4 years 157725.20 4-5 years 575094.67 Over 5 years 486791.29 Total 172621378.99 (2) Accounts receivable withdraw reversed or collected during the reporting period The withdrawal amount of the bad debt provision： In RMB Category Opening balance Amount of change in the current period Closing balanceAccrual Reversed or collected amount Write-off Other Aging portfolio 1352880.72 2360980.71 3713861.43 Total 1352880.72 2360980.71 3713861.43 Of which the significant amount of the reversed or collected part during the reporting period :None （3）The current accounts receivable write-offs situation None （4）The ending balance of other receivables owed by the imputation of the top five parties In RMB Name Amount Proportion(%) Bad debt provision Guangdong Union Electronic Services Co. Ltd. 100047025.70 57.96% Guangzhou Lingte Electronic Co.Ltd. 16299000.00 9.44% Guangdong Humen Bridge Co. Ltd. 11044082.54 6.40% Guangdong Lulu Traffic Development Co. Ltd. 10420000.00 6.04% Shandong Boan Intelligent Technology Co. Ltd 7409966.25 4.29% 2222989.88 Total 145220074.49 84.13% （5）Account receivable which terminate the recognition owning to the transfer of the financial assets None (6)The amount of the assets and liabilities formed by the transfer and the continues involvement of accounts receivable None 3. Prepayments （1）Aging analysis In RMB Aging Balance in year-end Balance Year-beginning Amount Proportion（%） Amount Proportion（%） Within 1 year 3518401.18 97.53% 11659714.88 98.57% 1-2 years 89136.83 2.47% Over 3 years 169738.00 1.43% Total 3607538.01 -- 11829452.88 -- Notes of the reasons of the prepayment ages over 1 year with significant amount but failed settled in time: None (2) Top 5 of the closing balance of the prepayment collected according to the prepayment target In RMB Name Relations with the Company Amount Aging Reasons for non-settleme nt Proportion % China Pacific Property Insurance Co. Ltd. Guangdong Branch Non- Related party 838016.00 Within 1 year Unliquidated 23.23 China Ping An Property Insurance Co. Ltd. Guangdong Branch Non- Related party 819624.15 Within 1 year Unliquidated 22.72 Guangdong Litong Property Investment Co. Ltd. Related party 776413.03 Within 1 year Unliquidated 21.52 Tianjing Kechang Huitong Information Technology Co. Ltd. Non- Related party 300000.00 Within 1 year Unliquidated 8.32 Guangdong Power Grid Energy Development Co.Ltd.Non- Related party 240500.00 Within 1 year Unliquidated 6.67 Total / 2974553.18 / / 82.46 4.Other accounts receivable In RMB Items Balance in year-end Balance Year-beginning Dividend receivable 2705472.90 7205472.90 Other receivable 58219894.74 15500954.60 Total 60925367.64 22706427.50 （1）Dividend receivable 1)Dividend receivable In RMB Items Balance in year-end Balance Year-beginning Guangdong Radio and Television Networks investment No.1 Limited partnership enterprise 1205472.90 1205472.90 Ganzhou Gankang Expressway Co. Ltd. 1500000.00 Guangdong Yueke Technology Petty Loan Co. Ltd. 6000000.00 Total 2705472.90 7205472.90 2）Significant dividend receivable aged over 1 year In RMB Items Balance in year-end Aging Reasons for non-recovery Whether with impairment and the judgment basis 广 Guangdong Radio and Television Networks investment No.1 Limited partnership enterprise 1205472.90 Over 1 year The Company account is temporarily frozen No it can be recovered in the future （2） Other accounts receivable 1) Other accounts receivable classified by the nature of accounts In RMB Nature Closing book balance Opening book balance Balance of settlement funds for securities transactions 47528056.18 47528056.18 Capital reduction due from Gankang 45000000.00 Petty cash 5654205.42 6125222.52 Gelin Enze Account 4007679.91 4007679.91 Cash deposit 4001660.43 3435790.57 Tran Other safer of long-term assets receivable 935820.00 935820.00 Other 2754248.87 5033333.69 Leas：Bad-debt provision -51661776.07 -51564948.27 Total 58219894.74 15500954.60 2）The withdrawal amount of the bad debt provision： In RMB Bad Debt Reserves Stage 1 Stage 2 Stage 3 TotalExpected credit losses over the next 12 months Expected credit loss over life (no credit impairment) Expected credit losses for the entire duration (credit impairment occurred) Balance as at January 12020 29212.18 51535736.09 51564948.27 Balance as at January 12020 in —— —— —— —— current Accrual 96827.80 96827.80 Balance as at December 312020 126039.98 51535736.09 51661776.07 Of which the significant amount of the reversed or collected part during the reporting period :None Note 1：The parent company once paid 33683774.79 yuan into Kunlun Securities Co. Ltd Guangdong Expressway technology investment Co. Ltd once paid 18000000.00 yuan into Kunlun Securities Co. Ltd. Qinghai Province Xining City’s intermediate people’s court made a adjudication under law declared that Kunlun Securities Co. Ltd went bankrupt and repaid debt in November 11 2006. On March 2007 The Company and Guangdong Expressway Technology Investment Co. Ltd had switched the money that paid into Kunlun Securities Co. Ltd to other account receivable and follow the careful principle to doubtful debts provision. The 710349.92 yuan Credit was Recovered in 2008 The 977527.77 yuan credit was recovered in 2011 The 652012.00 yuan Credit was recovered in 2014 The 1815828.92 yuan Credit was recovered in 2018 and the provision for had deb Note 2：Guangdong Expressway Technology investment Co. Ltd .should charge Beijing Gelin Enze Organic Fertilizer Co. Ltd.for 12220079.91 yuan. Eight millions of it was entrust loan three million was temporary borrowing 12400.00 yuan is the commission loan interest the rest of it was advance money for another Beijing Gelin Enze Organic Fertilizer Co. Ltd’s operating status was had and had already ceased producing Accordingly the controlling subsidiary of the company Guangdong Expressway Investment Co. Ltd. accounted full provision for Bad debt 12220079.91 yuan provision. The company in 2014 recovered arrears of 8000000.00 yuan rushed back to the provision for bad debts and write off uncollected interest entrusted loans according to tTh e settlement agreement of 212400.00 yuan. Changes in significant book balances for loss preparation current period □ Applicable √ Not applicable Disclosure by aging In RMB Aging Closing balance Within 1 year（Including 1 year） 54791424.11 1-2 years 985257.58 2-3 years 723934.77 Over 3 years 53381054.35 3-4 years 426977.40 4-5 years 493491.88 Over 5 years 52460585.07 Total 109881670.81 3） Accounts receivable withdraw reversed or collected during the reporting period The withdrawal amount of the bad debt provision： In RMB Category Balance Year-beginnin g Amount of change in the current period Balance in year-end Accrual Reversed or collected amount Write-off Other Accrual of single item 51535736.09 51535736.09 Accrual of portfolio-Aging portfolio 29212.18 96827.80 126039.98 Accrual of portfolio-Other portfolio Total 51564948.27 96827.80 51661776.07 Where the current bad debts back or recover significant amounts:None 4)The actual write-off other accounts receivable: None 5) Top 5 of the closing balance of the other accounts receivable collated according to the arrears party In RMB Name Nature Closing balance Aging Proportion of the total year end balance of the accounts receivable(%) Closing balance of bad debt provision Kunlun Securities Co.Ltd Securities trading se ttlement funds 47528056.18 Over 5 years 43.25% 47528056.18 Ganzhou Gankang Expressway Co. Ltd. Capital reduction due from Gankang 45000000.00 Within 1 year 40.95% Beijing Gelin Enze Current account 4007679.91 Over 5 years 3.65% 4007679.91 Guangdong Litong Real Estates Investment Co. Ltd. Deposit 1630467.36 Within 1 year 1.52% Vehicle parking deposit 35680.00 Over 5 years Guangdong Expressway Media Co.Ltd. Current account 1218110.44 Within 1 year 1.11% Total -- 99419993.89 -- 90.48% 51535736.09 (6) Accounts receivable involved with government subsidies None (7) Other account receivable which terminate the recognition owning to the transfer of the financial assets None (8) The amount of the assets and liabilities formed by the transfer and the continues involvement of other accounts receivable None 5. Inventories Whether the company need to comply with the disclosure requirements of the real estate industry No （1）Category of Inventory In RMB Items Closing book balance Opening book balance Book balance Provision for inventory impairment Book value Book balance Provision for inventory impairment Book value Raw material 49380.53 49380.53 111683.22 111683.22 Stock goods 4380.53 4380.53 Total 53761.06 53761.06 111683.22 111683.22 (2) Inventory depreciation reserve None (3)Description of The closing balance of inventories contain the amount of borrowing costs capitalized None （4）Description of amortization amount of contract performance cost in the current period None 6.Contract assets In RMB Items Year-end balance Year-beginning balance Book balance Bad debt provision Book value Book balance Bad debt provision Book value Quality guarantee 5452813.90 5452813.90 5046397.77 5046397.77 Total 5452813.90 5452813.90 5046397.77 5046397.77 Amount and reason of material change of book value of contract assets in the current period::None Provision for impairment of contract assets in the current period None 7.Non-current asset due within 1 year In RMB Items Year-end balance Year-beginning balance Pre-payment of business tax before replacing business tax with VAT 51745.32 51745.32 Total 51745.32 51745.32 8.Other current assets I n RMB Items Year-end balance Year-beginning balance Income tax to be deducted Income tax to be certified 27051.69 Short-term Creditor's Investment 196576603.21 Total 27051.69 196576603.21 2020 Annual Report 9. Long-term equity investment In RMB Investees Opening balance Increase/decrease Closing balance Closing balance of impairme nt provision Additional investment Negative investment Investment profit and loss recognized under the equity method Adjustment of other comprehensive income Changes of other equity Cash bonus or profits announced to issue With draw al of impai rmen t provi sion Ot he r I. Joint venture 2. Affiliated Company Guangdong Jiangzhong Expressway Co.Ltd. 179491516.98 12760987.96 192252504.94 Ganzhou Gankang Expressway Co. Ltd. 213672650.90 45000000.00 -21398030.18 1500000.00 145774620.72 Ganzhou Kangda Expressway Co. Ltd. 234733526.86 9080563.64 27000000.00 216814090.50 Shenzhen Huiyan Expressway Co. Ltd. 262682427.44 22726327.71 285408755.15 Zhaoqing Yuezhao Highway Co. Ltd. 308122059.69 44064159.14 49750000.00 302436218.83 Guoyuan Securities Co. Ltd. 793926807.52 129910442.24 32205888.19 -5192159.89 11940297.90 938910680.16 Guangdong Yueke Technology Petty Loan Co. Ltd. 214637335.45 10065984.93 9000000.00 215703320.38 Hunnan Lianzhi Technology Co. .Ltd. 80000000.00 5011902.75 69072.17 85080974.92 Subtotal 2207266324.84 209910442.24 45000000.00 114517784.14 -5192159.89 69072.17 99190297.90 2382381165.60 Total 2207266324.84 209910442.24 45000000.00 114517784.14 -5192159.89 69072.17 99190297.90 2382381165.60 2020 Annual Report Other note 8.Other Equity instrument investment In RMB Items Closing balance Opening balance Guangle Expressway Co. Ltd. 748348301.73 748348301.73 Guangdong Radio and Television Networks investment No.1 Limited partnership enterprise 50000000.00 50000000.00 China Everbright Bank Co. Ltd. 938667226.56 1037474303.04 Huaxia Securities Co. Ltd.（Notes1） Huazheng Asset Management Co. Ltd.（Notes2） Kunlun Securities Co. Ltd.（Notes3） Total 1737015528.29 1835822604.77 Note 1: The owner's equity of Huaxia Securities Co. Ltd. was negative and it entered liquidation procedure in December 2005.The Company made full provision for impairment in respect of this long-term equity investment of RMB 5.4 million.Note 2: According to De Wei Ping Gu Zi 2005 No. 88 Appraisal Report issued by Beijing Dewei Appraisal Co. Ltd. As the June 30 2005 the amount of net assets of Huazheng Asset Management Co. Ltd. in book was 279.132 million yuan and the appraised value was - 2299.5486 million yuan On October 14 2005 Jianyin CITIC Asset Management Co. Ltd. issued the Letter of Soliciting Opinions on Equity Assignment to the Company. Jianyin CITIC Asset Management Co. Ltd. was willing to pay the price of not more than 42 million yuanto acquire 100% equity of Huazheng Asset Management Co. Ltd. and solicited the Company's opinions. The Company replied on December 5 2005 abandoning the preemptive right under the same conditions. The Company made provision of 1.3932 million yuan for impairment in respect of this long-term equity investment of 1.62 million yuan.Note 3.The owner's equity of Kunlun Securities Co. Ltd. was negative and it entered liquidation procedure in October 2005. A wholly owned subsidiary of Guangdong Expressway Technology Investment Co. Ltd. Will invest Kunlun Securities Co. Ltd.'s full provision for impairment of 30 million yuan. Breakdown disclosure of investment in non-tradable equity instruments in the current period In RMB Items Dividend income recognized Cumulative gain Cumulative loss Amount of other consolidat ed income transferred to retained earnings Reasons for designation as measured at fair value and changes included in other comprehensive income Reasons for other consolidat ed income transferred to retained earnings Guangle Expressway Co.Ltd.Non-trans actional purpose for Items Dividend income recognized Cumulative gain Cumulative loss Amount of other consolidat ed income transferred to retained earnings Reasons for designation as measured at fair value and changes included in other comprehensive income Reasons for other consolidat ed income transferred to retained earnings shareholdi ng Guangdong Radio and Television Networks investment No.1 Limited partnership enterprise 440655.02 7802784.15 Non-trans actional purpose for shareholdi ng China Everbright Bank Co. Ltd. 50344558.0 2 421106349.76 Non-trans actional purpose for shareholdi ng Huaxia Securities Co. Ltd. 5400000.00 Non-trans actional purpose for shareholdi ng Huazheng Asset Management Co. Ltd. 1620000.00 Non-trans actional purpose for shareholdi ng Kunlun Securities Co. Ltd. 30000000.00 Non-trans actional purpose for shareholdi ng Total 50785213.0 4 428909133.91 37020000.00 11. Investment property (1) Investment property adopted the cost measurement mode √ Applicable □Not applicable In RMB Items Houses and buildings Land use right Construction in progress Total I. Original value 1.Opening balance 12664698.25 2971831.10 15636529.35 2.Increased amount of the period （1）Outsourcing (2)Inventory Fixed assets and Construction project into (3) )Increased of Enterprise consolidation 3.Decreased amount of the period （1）Disposal （2）Other Out 4.Closing balance 12664698.25 2971831.10 15636529.35 II.Accumulated depreciation accumulated amortization 1.Opening balance 10547091.78 1757937.20 12305028.98 2.Increased amount of the period 147549.12 73569.36 221118.48 (1)Withdrawal or amortization 147549.12 73569.36 221118.48 3.Decreased amount of the period （1）Disposal （2）Other Out 4.Closing balance 10694640.90 1831506.56 12526147.46 III. Impairment provision Items Houses and buildings Land use right Construction in progress Total 1.Opening balance 2.Increased amount of the period （1）Withdrawal 3.Decreased amount of the period （1）Disposal （2）Other Out 4.Closing balance IV. Book value 1.Closing book value 1970057.35 1140324.54 3110381.89 2.Opening book 2117606.47 1213893.90 3331500.37 (2) Investment property adopted fair value measurement mode □Applicable√ Not applicable (3) Details of investment property failed to accomplish certification of property In RMB Items Book balance Reason Houses and Building 1292746.74 Transportation and other ancillary facilities Not accreditation Total 1292746.74 12. Fixed assets In RMB Items Year-end balance Year-beginning balance Fixed assets 11540066429.69 12460188469.66 liquidation of fixed assets 9500.00 Total 11540075929.69 12460188469.66 2020 Annual Report (1) List of fixed assets In RMB Items Guangfo Expressway Fokai Expressway Guanghui Expressway Jingzhu Expressway Guangzhu section House and buildings Machinery equipment Transportation equipment Office equipment and other Total I. Original price 1.Opening balance 1460270190.66 10935058609.66 6475428904.48 4816156616.45 651538302.92 1581718051.00 62473441.73 109565991.37 26092210108.27 2.Increased amount of the period 8724808.53 1757934.00 296199676.97 2009197.16 34672992.94 343364609.60 （1）Purchase 5228185.60 2009197.16 12979530.72 20216913.48 （2）Transfer of project under construction 8724808.53 1578211.00 290971491.37 21693462.22 322967973.12 (3)Increased of Enterprise consolidation （4）Other 179723.00 179723.00 3.Decreased amount of the period 42240682.36 139438.00 70836932.08 3054950.00 9992986.30 126264988.74 （1）Disposal or scrap 42240682.36 139438.00 70836932.08 3054950.00 9992986.30 126264988.74 （2）Government subsidy offset 4.Closing balance 1460270190.66 10892817927.30 6475428904.48 4824881424.98 653156798.92 1807080795.89 61427688.89 134245998.01 26309309729.13 2020 Annual Report Items Guangfo Expressway Fokai Expressway Guanghui Expressway Jingzhu Expressway Guangzhu section House and buildings Machinery equipment Transportation equipment Office equipment and other Total II. Accumulated depreciation 1.Opening balance 1460270190.66 4494205215.58 3233900466.28 2841639585.51 404319093.80 1062403571.32 49538185.49 78507134.13 13624783442.77 2.Increased amount of the period 539758748.04 337731036.15 153324878.57 28686206.44 177723828.53 3143306.74 8179629.68 1248547634.15 （1）Withdrawal 539758748.04 337731036.15 153324878.57 28686206.44 177723828.53 3143306.74 8179629.68 1248547634.15 3.Decreased amount of the period 34351051.30 92136.45 65778334.71 2853709.15 9482660.65 112557892.26 （1）Disposal or scrap 34351051.30 92136.45 65778334.71 2853709.15 9482660.65 112557892.26 4.Closing balance 1460270190.66 4999612912.32 3571631502.43 2994964464.08 432913163.79 1174349065.14 49827783.08 77204103.16 14760773184.66 II. Accumulated depreciation 1.Opening balance 6638789.88 599405.96 7238195.84 2.Increased amount of the period 1231918.94 1231918.94 （1）Withdrawal 1231918.94 1231918.94 2020 Annual Report Items Guangfo Expressway Fokai Expressway Guanghui Expressway Jingzhu Expressway Guangzhu section House and buildings Machinery equipment Transportation equipment Office equipment and other Total 3.Decreased amount of the period （1）Disposal or scrap 4.Closing balance 7870708.82 599405.96 8470114.78 IV. Book value 1.Closing book value 5893205014.98 2903797402.05 1829916960.90 220243635.13 624861021.93 11599905.81 56442488.89 11540066429.69 2.Opening book 6440853394.08 3241528438.20 1974517030.94 247219209.12 512675689.80 12935256.24 30459451.28 12460188469.66 ⑵Temporarily idle fixed assets In RMB Items Original price Accumulated depreciation Impairment provision Book value Remark House and buildings 6014243.63 4047283.20 1966960.43 Total 6014243.63 4047283.20 1966960.43 ⑶Details of fixed assets failed to accomplish certification of property In RMB Items Book value Reason Transportation and other ancillary facilities 153886038.13 Transportation and other ancillary facilities，Not accreditation. （4）liquidation of fixed assets In RMB Items Year-end balance Year-beginning balance Transportation equipment 9500.00 Total 9500.00 13. Project under construction In RMB Items Year-end balance Year-beginning balance Project under construction 340611095.47 241274698.97 Total 340611095.47 241274698.97 （1）Project under construction In RMB Items Year-end balance Year-beginning balance Book balance Provision for devaluation Book value Book balance Provision for devaluation Book value Bridge Deck Treatment Project of Dachong Viaduct 117493329.30 117493329.30 67204790.39 67204790.39 Pavement Treatment 105958479.27 105958479.27 46573355.85 46573355.85 Items Year-end balance Year-beginning balance Book balance Provision for devaluation Book value Book balance Provision for devaluation Book value Project Gualuhu Interchange project 52045974.12 52045974.12 338747.00 338747.00 Reconstruction and Expansion of Sanbao to Shuikou 29547232.58 29547232.58 15943015.38 15943015.38 Odd project 35566080.20 35566080.20 40110826.35 40110826.35 Bridge Drainage Improvement Project Across Centralized Drinking Water Sources 71103964.00 71103964.00 Total 340611095.47 340611095.47 241274698.97 241274698.97 2020 Annual Report (2) Changes of significant construction in progress In RMB Name of project Budget Opening balance Increase Transferred to fixed assets Other decrease End balance Proportio n % Projec t proces s Capitalization of interest Including: capitalization of interest this period Capitali zation of interest rate (%) Sourc e of fundi ng Reconstruction and Expansion of Sanbao to Shuikou 3426206700.00 15943015.38 13604217.20 29547232.58 75.76% 82.29 72779504.82 Other Bridge Drainage Improvement Project Across Centralized Drinking Water Sources 295867737.02 71103964.00 204100412.74 275204376.74 93.02% 100.00 Other Gualuhu Interchange project 197520000.00 338747.00 51707227.12 52045974.12 26.35% 26.35 Other Pavement Treatment Project 186000000.00 46573355.85 59385123.42 105958479.27 56.97% 56.97 2301824.65 2301824.65 4.25% Other Bridge Deck Treatment Project of Dachong Viaduct 123000000.00 67204790.39 50288538.91 117493329.30 95.52% 95.52 3953599.55 3953599.55 4.25% Other Total 4228594437.02 201163872.62 379085519.39 275204376.74 305045015.27 -- -- 79034929.02 6255424.20 -- 2020 Annual Report (3)Provision for impairment of construction projects in the current period None 14. Intangible assets (1) List of intangible assets In RMB Items Land use right Software Toll road franchises Total I. Original price 1.Opening balance 1311658.00 39920855.16 41232513.16 2.Increased amount of the period 1636467.03 318348741.86 319985208.89 (1) Purchase 929667.03 929667.03 (2)Internal Development (3)Increased of Enterprise Combination （4）Other 706800.00 318348741.86 319055541.86 3.Decreased amount of the period 1645037.00 1645037.00 （1）Disposal 1645037.00 1645037.00 4.Closing balance 1311658.00 39912285.19 318348741.86 359572685.05 II.Accumulated amortization 1.Opening balance 1311658.00 31158815.64 32470473.64 2.Increased amount of the period 2944945.74 23420946.15 26365891.89 (1) Withdrawal 2944945.74 23420946.15 26365891.89 3.Decreased amount of the period 1645037.00 1645037.00 （1）Disposal 1645037.00 1645037.00 4.Closing balance 1311658.00 32458724.38 23420946.15 57191328.53 III. Impairment provision Items Land use right Software Toll road franchises Total 1.Opening balance 2.Increased amount of the period (1) Withdrawal 3.Decreased amount of the period （1）Disposal 4.Closing balance IV. Book value 1.Closing book value 7453560.81 294927795.71 302381356.52 2.Opening book value 8762039.52 8762039.52 The intangible assets by the end of the formation of the company's internal R & D accounted of the proportion of the balance of intangible assets Note: According to the relevant government documents the company included the relevant operating expenses incurred during the epidemic prevention and control period from February 17 2020 to May 5 2020 into intangible assets-book value of toll road franchise and began to accrue and amortize the remaining operating period in May 2020 according to the traffic flow method. ⑵Details of Land use right failed to accomplish certification of property None 15. Long-term amortize expenses In RMB Items Balance in year-begin Increase in this period Amortized expenses Other loss Balance in year-end Rental fee for plant 1114764.44 107017.44 1007747.00 Prepaid business tax and surcharges before replacement of 2805000.00 350625.00 2454375.00 business tax with value-added tax Total 3919764.44 457642.44 3462122.00 16. Deferred income tax assets/deferred income tax liabilities (1) Deferred income tax assets had not been off-set In RMB Items Balance in year-end Balance Year-beginning Deductible temporary difference Deferred income tax assets Deductible temporary difference Deferred income tax assets Assets impairment provisions 8705572.16 2176393.04 7238195.84 1809548.96 Deductible loss 1000101381.76 250025345.44 1054468552.04 263617138.01 Amortization of intangible assets 269669149.91 67417287.48 480269676.65 120067419.16 Deferred income 44545569.73 11136392.43 Total 1323021673.56 330755418.39 1541976424.53 385494106.13 (2) Deferred income tax liabilities had not been off-set In RMB Items Balance in year-end Balance Year-beginning Deductible temporary difference Deferred income tax liabilities Deductible temporary difference Deferred income tax liabilities Changes in the fair value of other equity instruments 421106349.76 105276587.44 519913426.24 129978356.56 Deductible temporary differences in the formation of asset impairment 1124772402.32 281193100.58 1195775134.08 298943783.52 Difference of amortization method of franchise of toll road 2533490.83 633372.72 Total 1548412242.91 387103060.74 1715688560.32 428922140.08 （3）Details of unrecognized deferred tax assets In RMB Items Balance in year-end Balance Year-beginning Deductible loss 11452524.12 8013102.87 Assets impairment provisions 91984931.50 89939941.56 Cost of outstanding invoices 1941115.68 Total 103437455.62 99894160.11 （4）Deductible losses of the un-recognized deferred income tax asset will expire in the following years In RMB Year Balance in year-end Balance Year-beginning Remark 2020 2021 2022 1133109.04 1133109.04 2023 3129535.72 3210991.23 2024 3618779.07 3669002.60 2025 3571100.29 Total 11452524.12 8013102.87 -- 17. Other Non-current assets In RMB Items Balance in year-end Balance Year-beginning Book balance Provisio n for devaluat ion Book value Book balance Provisio n for devaluati on Book value Prepaid fixed assets engineering fees 21946578.75 21946578. 75 50442297.97 50442297 .97 Prepaid business tax 467027.76 467027.76 518773.08 518773.08 Less：Part due within 1 year(this section VII-7) -51745.32 -51745.32 -51745.32 -51745.32 Total 22361861.19 22361861. 19 50909325.73 50909325 .73 18. Short-term Borrowing （1）Short-term Borrowing In RMB Items Balance in year-end Unpaid/Uncarry over reason Credit Borrowing 200000000.00 Interest accrued on short-term borrowing 192500.00 Total 200192500.00 （2）Overdue short-term borrowings None 19.Account payable （1） List of account payable In RMB Items Balance in year-end Balance Year-beginning Within 1 year（Including 1 year） 252654968.64 246906431.07 1-2 years（including2 years） 44097234.36 14937937.96 2-3 years（including 3 years） 10392605.88 4199281.77 Over 3 years 62628533.83 102263947.61 Total 369773342.71 368307598.41 （2）Significant payable aging more than 1 year In RMB Items Balance in year-end Reason Foshan Land and resources Bureau. 30507598.21 Unsettled Guang Zhongjiang Expressway project Management Dept 28000000.00 Unsettled Guangzhou Tuzhiling Computer technology Co. Ltd. 9426384.44 Unsettled Heshan Land and resources Bureau 10186893.60 Unsettled Guangdong Provincial Freeway Co.Ltd. 8746491.18 Unsettled Total 86867367.43 -- Other note： 20. Prepayment received (1) List of Prepayment received In RMB Items Balance in year-end Balance Year-beginning Within 1 year（Including 1 year） 1473106.10 1865984.63 1-2 years（Including 2 years） 2-3 years（Including 3 years） Over 3 years 9835901.31 10951499.43 Total 11309007.41 12817484.06 (2) Significant advance from customers aging over one year In RMB Items Balance in year-end Unpaid/Uncarry over reason Guangzhou Huanlong Expressway Co.Ltd. 7961163.14 Unsettled Guanghdong Xinle Technology Development Co. Ltd. 1427700.65 Unsettled Total 9388863.79 -- （3）Settlement of outstanding projects resulting from final construction contracts None 21.Contract liabilities In RMB Items Balance in year-end Balance Year-beginning Payments received in advance 309734.51 2787610.63 Less：Other non-current liabilities Total 309734.51 2787610.63 22. Payable Employee wage （1）Payable Employee wage In RMB Items Year-beginning balance Increase in the current period Decrease in the current period Year-end balance I. Short-term compensation 15173142.46 420274135.08 418721079.41 16726198.13 II.Post-employment benefits - def ined contribution plans 28537890.35 28537890.35 III. Dismissal benefits 80117.63 80117.63 Total 15173142.46 448892143.06 447339087.39 16726198.13 （2）Short-term Remuneration In RMB Items Year-beginning balance Increase in the current period Decrease in the current period Year-end balance 1.Wages bonuses allowances and subsidies 642463.49 315741784.41 315919184.41 465063.49 2.Employee welfare 33098661.41 33098661.41 3. Social insurance premiums 21778259.66 21778259.66 Including ：Medical insurance 13057047.19 13057047.19 Work injury insurance 26725.04 26725.04 Maternity insurance 2427076.20 2427076.20 Other 6267411.23 6267411.23 4.Public reserves for housing 37421150.00 37421150.00 5.Union funds and staff education fee 13216025.40 10494429.86 9131476.16 14578979.10 8.Other 1314653.57 1739849.74 1372347.77 1682155.54 Total 15173142.46 420274135.08 418721079.41 16726198.13 （3）Defined contribution plans listed In RMB Items Balance Year-beginning Increase in this period Payable in this period Balance in year-end 1. Basic old-age insurance premiums 2832716.48 2832716.48 2.Unemployment insurance 87937.45 87937.45 3.Enterprise annuity payment 25617236.42 25617236.42 Total 28537890.35 28537890.35 23. Tax Payable In RMB Items Balance in year-end Balance Year-beginning VAT 19253425.01 19799902.60 Enterprise Income tax 192073414.37 149304329.42 Individual Income tax 2589498.58 3294428.41 City Construction tax 1270608.27 1384098.16 Education subjoin 594019.27 631151.81 Locality Education subjoin 376577.48 401070.94 Land use tax Property tax 45461.47 17061.15 Stamp tax 1514826.65 218722.91 Construction costs for cultural undertaking 30561.68 31200.00 Other 119661.79 Total 217748392.78 175201627.19 24.Other accounts payable In RMB Items Balance in year-end Balance Year-beginning Dividend payable 22262804.39 20020119.31 Other account payable 1490356555.39 454669434.95 Total 1512619359.78 474689554.26 （1）Dividends payable In RMB Items Balance in year-end Balance Year-beginning Common stock dividends 22262804.39 20020119.31 Total 22262804.39 20020119.31 Note: Including significant unpaid dividends payable over one year the unpaid reason shall be disclosed: Final dividend payable 19637548.28yuan for more than a year in unpaid dividends to shareholders over the year w as mainly due to non-payment of shareholder dividends did not provide information on interest-bearing bank did not share reform of shareholders to receive dividends or provide application to receive dividends the bank informa tion is incorrect resulting in failure to pay a dividend or refund. （2）Other accounts payable (1) Other accounts payable listed by nature of the account In RMB Items Year-end balance Year-Beginning balance M&A funds payable to Guanghui 21% equity 1221839292.00 Estimated project cost 147443692.67 305588291.39 Deposit warranty and security deposit 82529159.41 88113871.73 Other 36456530.29 60277636.22 Temporary collection payable 2087881.02 686335.61 Withheld and remitted payment 3300.00 Total 1490356555.39 454669434.95 (2) Other significant accounts payable with aging over one year In RMB Items Closing balance Unpaid/un-carry over reason Yayao to Xiebian extension 12499448.48 Outstanding Poly Changda Highway Engineering Co. Ltd. 14146027.78 Project Quality guaranteesconstract liquidated damages Guangdong Guanyue Road & Bridge Co. Ltd. 6967006.70 Project Quality guarantee Guangdong Nengda High Grade Highway Maintenance Co. Ltd. 3420026.10 Contract liquidated damages Wage margin for migrant workers Dahao Municipal Construction Co. Ltd. 3000000.00 Project Quality guarantee Total 40032509.06 -- 25. Non-current liabilities due within 1 year In RMB Items Balance year-end Year-beginning balance Long-term loans due within 1 year 203536200.00 765445000.00 Long-term payable due within 1 year 732075.46 256603.77 Interest payable due within 1 year 62059742.01 30545186.84 Total 266328017.47 796246790.61 26.Other current liabilities In RMB Items Balance year-end Year-beginning balance Tax to be rewritten 648581.64 1246636.74 Total 648581.64 1246636.74 27. Long-term loan (1) Category of long-term loan In RMB Items Balance year-end Year-beginning balance Pledge loan 657365000.00 447365000.00 Guaranteed loan 375000000.00 Credit loan 4523610000.00 4869095000.00 Long-term loans due within one year -203536200.00 -765445000.00 Total 4977438800.00 4926015000.00 28.Bond payable （1）Bond payable In RMB Items Balance year-end Year-beginning balance Medium- term note 1426488336.65 678124972.89 Total 1426488336.65 678124972.89 2020 Annual Report （2）Changes of bonds payable(Not including the other financial instrument of preferred stock and perpetual capital securities that classify as financial liability In RMB Name of the bond Book value Issue date Period Issue amount Opening balance The current issue Withdraw interest at par Overflow discount amount Pay in current period Closing balance 19 Guangdong ExpresswayMT N001 680000000.00 2019.2.27 2019.3.1-2024.3.1 680000000.00 678124972.89 -450343.98 678575316.87 20 Guangdong ExpresswayMT N001 750000000.00 2020.3.13 2020.3.17-2025.3.17 750000000.00 750000000.00 2086980.22 747913019.78 Total -- -- -- 1430000000.00 678124972.89 750000000.00 1636636.24 1426488336. 65 (3) Note to conditions and time of share transfer of convertible bonds None （4）Other financial instruments that are classified as financial liabilities None 29. Long-term payable In RMB Items Balance year-end Year-beginning balance Long-term payable 40406172.37 39369379.91 Total 40406172.37 39369379.91 (1) Long-term payable listed by nature of the account In RMB Items Balance year-end Year-beginning balance Non-operating asset payable 2022210.11 2022210.11 Entrust loans 36000000.00 36000000.00 Medium term bill underwriting fee 3116037.72 1603773.5 Less：Part due within 1 year 732075.46 256603.77 30. Deferred income In RMB Items Opening balance Increase Decrease Closing balance Cause Government subsidy 58351800.00 13806230.36 44545569.64 Rental income 51000000.00 6375000.00 44625000.00 Total 51000000.00 58351800.00 20181230.36 89170569.64 -- Details of government subsidies： In RMB Items Beginni ng of term New subsidy in current period Amount transferred to non-operationa l income Other income recorded in the current period Amount of cost deducted in the current period Other chang es End of term Asset-related or income-relate d Cancellation of Expressway Provincial Toll Station Project 55851800.00 11306230.36 44545569.64 Related to assets Financial discount 2500000.00 2500000.00 Related to income 31. Stock capital In RMB Balance Year-beginning Changed（+，-） Balance in year-endIssuance of new share Bonus shares Capitalizatio n of public reserve Other Subtotal Total of capital shares 2090806126.00 2090806126.00 32. Capital reserves In RMB Items Year-beginning balance Increase in the current period Decrease in the current period Year-end balance Share premium 3002260722.99 2493549576.00 508711146.99 (1) Capital invested by investors 2508408342.99 2508408342.99 (2) Influence of business combination under the same control 493852380.00 2493549576.00 -1999697196.00 Other capital reserves 91756406.32 45501657.17 137258063.49 (1) Changes in other equity of the investee under the equity accounting 456002.32 69072.17 525074.49 （2）Other 91300404.00 45432585.00 136732989.00 Total 3094017129.31 45501657.17 2493549576.00 645969210.48 - The situation of change in the current capital reserve is as follows: ① The reduction of capital reserve-equity premium in this period is due to the merger of Guangdong Guanghui Expressway Co. Ltd. under the same control which reduces capital reserve by RMB 2493549576.00.② The increase of capital reserve-others in this period is mainly due to the agreement signed by Guanghui and Zengcheng District People's Government to add interchange on Zengcheng Section of Guanghui Expressway which stipulates that Guanghui will build Shaning Road Interchange and Xincheng Avenue Interchange and all expenses incurred in building interchange will be borne by Zengcheng District People's Government. After the project is completed it will be managed by Guanghui. A total of RMB 179020400.00 was received from Zengcheng District Government at the beginning of the period of which the opening balance of capital reserve attributable to the parent company-other capital reserve was RMB 91300404.00 and RMB 89083500.00 was newly received in this period of which capital reserve attributable to the parent company-other capital reserve increased by RMB 45432585.00 in this period. 2020 Annual Report 33. Other comprehensive income In RMB Items Year-beginning balance Amount of current period Year-end balanceAmount incurred before income tax Less：Amount transferred into profit and loss in the current period that recognied into other comprehensive income in prior period Less：Prior period included in other composite income transfer to retained income in the current period Less：Income tax expenses After-tax attribute to the parent company After-ta x attribute to minority sharehol der 1.Other comprehensive income will be reclassified into income or loss in the future 389935069.68 -98807076.48 -24701769.12 -74105307.36 315829762.32 Changes in fair value of investments in other equity instruments 389935069.68 -98807076.48 -24701769.12 -74105307.36 315829762.32 2.Other comprehensive income reclassifiable to profit or loss in subsequent periods -7741724.78 -5192159.89 -5192159.89 -12933884.67 Including：Share of other comprehensive income of the investee that cannot be transferred to profit or loss accounted for using the equity method -7741724.78 -5192159.89 -5192159.89 -12933884.67 Total of other comprehensive income 382193344.90 -103999236.37 -24701769.12 -79297467.25 302895877.65 Other notes including the adjustment of the recognition of initial amount of effective part of the cash flow hedging gains and losses transfer into arbitraged items: 34. Surplus reserve In RMB Items Year-beginning balance Increase in the current period Decrease in the current period Year-end balance Statutory surplus reserve 1074553052.81 93232912.82 1167785965.63 Total 1074553052.81 93232912.82 1167785965.63 35. Retained profits In RMB Items Amount of this period Amount of last period Before adjustments: Retained profits in last period end 3915790810.76 3938609136.59 Adjust the total undistributed profits at the beginning of the period 7497215.29 After adjustments: Retained profits at the period beginning 3915790810.76 3946106351.88 Add：Net profit belonging to the owner of the parent company 867842774.78 1469187067.83 Less: Statutory surplus reserve 93232912.82 135022507.55 Common stock dividend payable 882320185.17 1175033042.81 Other（Note） 82401168.20 189447058.59 Retained profit at the end of this term 3725679319.35 3915790810.76 As regards the details of adjusted the beginning undistributed profits (1)As the retroactive adjustment on Enterprise Accounting Standards and its related new regulations the affected beginning undistributed profits are RMB 0.00. (2) As the change of the accounting policy the affected beginning undistributed profits are RMB 0.00. (3) As the correction of significant accounting error the affected beginning undistributed profits are RMB 0.00 . (4) As the change of consolidation scope caused by the same control the affected beginning undistributed profits are RMB 0.00. (5) Other adjustment of the total affected beginning undistributed profits are RMB 0.00 . Note: Other items are the dividends corresponding to the 21% equity of this major asset restructuring transaction distributed by Guangdong Guanghui Expressway Co. Ltd. to the shareholder Guangdong Provincial Freeway Co.Ltd..as stated in "VIII. Changes in the Scope of Consolidation 1. Business Combination under the Same Control" during the reporting period. 36.Operation income and operation cost In RMB Items Amount of this period Amount of last period Income Cost Income Cost Main operation 3722365693.29 1633666936.51 4929198882.32 1891514552.64 Other operation 67983182.97 28556759.62 69817884.42 32963381.26 Total 3790348876.26 1662223696.13 4999016766.74 1924477933.90 Whether the net profit before and after deducting non-recurring gains and losses is negative after audit □ Yes √ No 37. Business tax and subjoin In RMB Items Amount of this period Amount of last period Urban construction tax 7512714.60 9899795.27 Education surcharge 3578509.64 4705324.22 Property tax 5212158.72 3635796.50 Land use tax 1830767.01 2607625.78 Vehicle use tax 77663.79 71398.77 Stamp tax 2310400.84 756487.51 Business tax 370495.32 370495.32 Locality Education surcharge 2379608.64 3130192.25 Construction of cultural undertakings 84510.00 Other 129610.93 143742.01 Total 23401929.49 25405367.63 38. Administrative expenses In RMB Items Amount of this period Amount of last period Wage 141324125.20 149431400.61 Depreciation and Amortization 9870249.16 11781051.98 Items Amount of this period Amount of last period Intangible assets amortization 2368807.27 2397249.26 Low consumables amortization 1316594.00 1747119.88 Rental fee 9351373.71 11677765.22 Office expenses 7437025.62 7837930.83 Travel expenses 573930.76 1324609.53 Consultation expenses 2595902.63 3290750.94 The fee for hiring agency 7179452.28 5558915.38 Listing fee 864123.92 869876.63 Information cost and maintenance fee 2830419.98 2674063.40 Other 18233115.05 20323921.14 Total 203945119.58 218914654.80 39.R& D expenses In RMB Items Amount of this period Amount of last period Wags 315808.12 Materials expenses 88495.58 Total 404303.70 Other note： 40.Financial expenses In RMB Items Amount of this period Amount of last period Interest expenses 264407174.38 257098768.09 Deposit interest income（-） -50618519.70 -39377414.30 Exchange Income and loss（Gain-） -1815160.91 1590432.88 Bank commission charge 881757.74 1077195.61 Other 3327123.37 3788234.38 Total 216182374.88 224177216.66 41.Other gains In RMB Items Amount of this period Amount of last period Related to assets/ Related to income Government subsidy- Cancellation of Expressway Provincial Toll Station Project 11306230.36 Related to assets Government subsidy- Stable job subsidies 516603.84 Related to income Maternity allowance 440077.14 642489.29 Related to income Veterans' VAT reduction and exemption 326184.25 Related to income Withholding and remitting enterprise prepaid income tax fees 195477.50 414891.18 Related to income Input tax plus deduction 34836.75 19409.20 Related to income Withholding and remitting enterprise prepaid income tax fees 575813.38 Related to income Enterprise incentive subsidy funds 66000.00 Related to income Enterprise office space rental subsidy 21937.00 Related to income 42. Investment income In RMB Items Amount of this period Amount of last period Long-term equity investment income by equity method 114517784.14 168708231.04 Dividends earned during the holding period on investments in other equity instrument 50785213.04 38912399.15 Interest income on entrusted loans 6063838.37 7144413.37 Total 171366835.55 214765043.56 43. Credit impairment losses In RMB Items Amount of this period Amount of last period Impairment losses on accounts receivable -2360980.71 -176000.73 Impairment losses on other receivable -96827.80 -12983.19 Total -2457808.51 -188983.92 44. Asset impairment loss In RMB Items Amount of this period Amount of last period Loss on impairment of fixed assets -1231918.94 -7238195.84 Total -1231918.94 -7238195.84 45.Assets disposal income In RMB Source Amount of this period Amount of last period Non-current assets disposal gains 276051.47 Including：Income from disposal of Fixed assets 276051.47 Income from disposal of Intangible assets Income from disposal of Intellectual property right 18755848.99 Total 19031900.46 46. Non-Operation income In RMB Items Amount of this period Amount of last period Recorded in the amount of the non-recurring gains and losses Insurance claim income 3538886.07 3028261.81 3538886.07 Road property claim income 2858053.10 2772329.53 2858053.10 Relocation compensation income 3353085.30 3353085.30 Compensation for construction land and ground attachments 1210712.86 2292510.28 1210712.86 Other 789104.03 738999.09 789104.03 Total 11749841.36 8832100.71 11749841.36 47. Non-Operation expense In RMB Items Amount of current period Amount of previous period The amount of non-operating gains & losses Road rehabilitation expenditure 5167239.28 4310540.20 5167239.28 Loss & abandonment of non-current assets 13637658.30 11690361.16 13637658.30 Fine 711701.58 2216.57 711701.58 Relocation compensation income 405100.00 1595684.00 405100.00 Other 721233.61 156751.69 721233.61 Total 20642932.77 17755553.62 20642932.77 48. Income tax expense (1) Lists of income tax expense In RMB Items Amount of current period Amount of previous period Current income tax expense 453788495.42 639863876.23 Deferred income tax expense 37621377.52 33921146.57 Total 491409872.94 673785022.80 (2) Adjustment process of accounting profit and income tax expense In RMB Items Amount of current period Total 1855794879.01 Current income tax expense accounted by tax and relevant regulations 463948719.75 Influence of income tax before adjustment -62313.43 Influence of non taxable income -41215585.54 Impact of non-deductible costs expenses and losses 14846139.47 The current period does not affect the deferred tax assets recognized deductible temporary differences or deductible loss 1342110.41 Other 52550802.28 Income tax expense 491409872.94 49.Items of Cash flow statement （1）Other cash received from business operation In RMB Items Amount of current period Amount of previous period Interest income 50618519.70 39377414.30 Unit current account 75997867.92 64183369.36 Net toll income received by networked toll clearing 2387993.96 Cancellation of Expressway Provincial Toll Station Project 55851800.00 Total 184856181.58 103560783.66 （2）Other cash paid related to operating activities In RMB Items Amount of current period Amount of previous period Management expense 47721287.38 54682646.22 Unit current account 37898902.95 14791928.56 Net toll income received by networked toll clearing 10709945.42 Total 85620190.33 80184520.20 Note： (3)Cash received related to other investment activities In RMB Items Amount of current period Amount of previous period Government infrastructure investment subsidies 89083500.00 85985000.00 Total 89083500.00 85985000.00 (4).Cash paid related to other Financing activities In RMB Items Amount of current period Amount of previous period Issuance fee of medium-term notes 1122177.00 791384.00 Purchase of 21% equity consideration of Guanghui 1271710284.00 Total 1272832461.00 791384.00 50. Supplement Information for cash flow statement （1）Supplement Information for cash flow statement In RMB Supplement Information Amount of current period Amount of previous period I. Adjusting net profit to cash flow from operating activities -- -- Net profit 1364385006.07 2151443422.35 Add:Credit loss provision 2457808.51 188983.92 : Impairment loss provision of assets 1231918.94 7238195.84 Depreciation of fixed assets oil and gas assets and consumable biological assets 1009578943.06 1207510097.27 Depreciation of Use right assets Amortization of intangible assets 26319338.62 3149424.55 Amortization of Long-term deferred expenses 457642.44 457642.44 Loss on disposal of fixed assets intangible assets and other long-term deferred assets -19031900.46 Fixed assets scrap loss 13637658.30 11690361.16 Loss on fair value changes Financial cost 265092013.47 266483287.67 Loss on investment -171366835.55 -214765043.56 Decrease of deferred income tax assets 54738687.74 61990928.66 Increased of deferred income tax liabilities -41819079.34 -28069782.09 Decrease of inventories 57922.16 -30665.31 Decease of operating receivables 136745935.47 -15041345.19 Increased of operating Payable -25329718.84 -210532420.20 Other Net cash flows arising from operating activities 2636187241.05 3222681187.05 II. Significant investment and financing activities that without cash flows: -- -- Conversion of debt into capital Convertible corporate bonds maturing within one year Supplement Information Amount of current period Amount of previous period Financing of fixed assets leased 3．Movement of cash and cash equivalents： -- -- Ending balance of cash 2846176803.89 3052977164.15 Less: Beginning balance of cash equivalents 3052977164.15 2744843796.86 Add：End balance of cash equivalents Less: Beginning balance of cash equivalents Net increase of cash and cash equivalent -206800360.26 308133367.29 （2）Composition of cash and cash equivalents In RMB Items Balance in year-end Balance in year-Beginning Cash 2846176803.89 3052977164.15 Of which: Cash in stock 54482.68 75833.29 Bank savings could be used at any time 2845600152.23 3051662845.33 Other monetary capital could be used at any time 522168.98 1238485.53 Balance of cash and cash equivalents at the period end 2846176803.89 3052977164.15 Other note： 51. The assets with the ownership or use right restricted In RMB Items Book value at the end of the period Restricted reason Monetary fund 1221200.00 Land reclamation funds in the fund escrow account Total 1221200.00 -- Other： As of December 31 2020 the Company's subsidiary Jingzhu Expressway Guangzhu Section Co. Ltd borrowed 657365000.00 yuan from Wuyang Sub-branch of Industrial and Commercial Bank of China (including 75170000.00 yuan in non-current liabilities due within one year and 582195000.00 yuan in long-term loans) and provided a pledge guarantee of 19.2% of the project's toll interest (the right to collect tolls for vehicles traveling on the Guangzhu section of Jingzhu Expressway and the revenue generated by owning such right). 2020 Annual Report VIII. Changes of merge scope 1. Business combination under the same control (1) Business Combination under the same control during the reporting period In RMB Name Proportion of stock rights Forming the basis for merger of enterprises under the same control Combination date Recogniti on basis of Combina tion date Income from the period-begin to the combination date of the combination Net profit from the reporting period to the combination date of the combination Income during the period of comparison Net profit during the period of comparison Guangdong Guanghui Expressway Co. Ltd. 51.00% Under the control of the same party December 312020 Acquisiti on of control 1616980738.55 780305035.07 1943745753.48 1002651683.59 Other note： （2）Combined cost In RMB Combined cost Guangdong Guanghui Expressway Co. Ltd. --Cash 2493549576.00 （3）The book value of the assets and liabilities of the merged party on the date of consolidation In RMB Guangdong Guanghui Expressway Co. Ltd. Combination date Last closing period Monetary funds 1006493048.13 236277469.65 Account receivable 59804115.72 57890140.44 Fixed assets 3271321898.32 3534487996.01 Loans 5590000.00 285590000.00 Account payable 135706707.74 79235904.15 Payable to employees 308597.50 350617.76 Net assets 3971913931.56 3494911911.72 Less： Minority shareholders' rights 1946237826.46 1712506836.74 Net assets acquired 2025676105.10 1782405074.98 Contingent liabilities of the combined party undertaken in combination：None 2. Other reasons for the changes in combination scope Notes to reasons for the changes in combination scope (Newly established subsidiary and subsidiary of liquidation) and relevant information: Original subsidiary name Place of registration Business nature Sharehold ing ratio (%) Proportion of voting rights entitled to (%) Reasons for not becoming a subsidiary in this year Guangzhou Guangzhu Transportation Investment Management Co. Ltd Guangzhou Investment Management 100.00 100.00Consolidation by combination IX. Equity in other entities 1. Equity in subsidiary (1) The structure of the enterprise group Name of Subsidiary Main Places of Operation Registra tion Place Nature of Business Shareholding Ratio (%) Obtaining Method Directly Indirectl y Guangfo Expressway Co. Ltd. Guangzhou Guangz hou Expressway Management 75.00% Under the same control business Guangdong Expressway Technology Investment Co.Ltd.Guangzhou Guangz hou Investment in technical industries and provision of relevant 100.00% Investment Guangdong Guanghui Expressway Co. Ltd. Guangzhou Guangz hou Investment management 51.00% Under the same control business combination Jingzhu Expressway Guangzhu Section Co.Ltd.Zhongshan Guangz hou Expressway Management 75.00% Under the same control business combination Yuegao Capital Investment(Hengqin)Co. Ltd.Guangzhou Zhuhai Investment management 100.00% Investment Notes: holding proportion in subsidiary different from voting proportion: None Basis of holding half or less voting rights but still been controlled investee and holding more than half of the voting rights not been controlled investee: None Significant structure entities and controlling basis in the scope of combination: None Basis of determine whether the Company is the agent or the principal: None (2) Important Non-wholly-owned Subsidiary In RMB Name of Subsidiary Shareholdin g Ratio of Minority Shareholder s (%) Profit or Loss Owned by the Minority Shareholders in the Current Period Dividends Distributed to the Minority Shareholders in the Current Period Equity Balance of the Minority Shareholders in the End of the Period Guangfo Expressway Co. Ltd. 25.00% 38758062.16 61436760.63 115101373.29 Guangdong Guanghui Expressway Co. Ltd. 49.00% 382349467.18 192269392.46 1946237826.46 Jingzhu Expressway Guangzhu Section Co.Ltd. 25.00% 75434701.95 126983792.91 237840885.42 Holding proportion of minority shareholder in subsidiary different from voting proportion None 2020 Annual Report (3) The main financial information of significant not wholly owned subsidiary In RMB Name of Subsidia ry Year-end balance Year-beginning balance Current assets Non- current assets Total assets Current Liabilities Non- current liabilities Total liabilities Current assets Non- current assets Total assets Current Liabilities Non- current liabilities Total liabilities Guangfo Express way Co.Ltd. 475293 044.67 55900968.26 531194012.93 67267992.5 0 3520527.29 70788519.79 560965221. 56 47173764.91 608138986.4 7 57018699.4 2 57018699.42 Guangdo ng Guanghu i Express way Co.Ltd. 10664 12539. 00 3451858995. 85 4518271534. 85 305774405. 46 240583197. 83 546357603.2 9 676184932. 27 3551837539. 85 4228022472. 12 206052396. 61 527058163.7 9 733110560.4 0 Jingzhu Express way Guangzh u Section Co.Ltd. 118177 442.22 2272633604. 38 2390811046. 60 470629108. 30 968818396. 62 1439447504. 92 301043906. 12 2257506902. 82 2558550808. 94 377916598. 72 1023074304. 71 1400990903. 43 In RMB Name Amount of current period Amount of previous period Business income Net profit Total Comprehensive Cash flows from operating Business income Net profit Total Comprehensive Cash flows from operating 2020 Annual Report income activities income activities Guangfo Expressway Co.Ltd. 333647719.92 155032248.63 155032248.63 188091317.89 475502565.03 250762288.30 250762288.30 244313182.32 Guangdong Guanghui Expressway Co. Ltd. 1616980738.55 780305035.07 780305035.07 1173180438.28 1943745753.48 1002651683.59 1002651683.59 1234129289.22 Jingzhu Expressway Guangzhu Section Co.Ltd. 812354042.82 301738807.80 301738807.80 542082484.05 1218734018.60 513065829.93 513065829.93 772968519.31 Other note： (4) Significant restrictions of using enterprise group assets and pay off enterprise group debt None (5) Provide financial support or other support for structure entities incorporate into the scope of consolidated financial statements None 2. The transaction of the Company with its owner’s equity share changed but still controlling the subsidiary (1) Significant joint venture arrangement or associated enterprise None （2）Affect of the transaction on the minority equity and owner's equity attributable to the parent company None 3. Equity in joint venture arrangement or associated enterprise (1) Significant joint venture arrangement or associated enterprise Name Main operating place Registration place Business nature Proportion Accounting treatment of the investment of joint venture or associated enterprise Directly Indirectl y Zhaoqing Yuezhao Highway Co. Ltd.Zhaoqing Guangdong Zhaoqing Guangdong Expressway Management 25.00% Equity method Shenzhen Huiyan Expressway Co. Ltd.Shenzhen Guangdong Shenzhen Guangdong Expressway Management 33.33% Equity method Guangdong Jiangzhong Expressway Co.Ltd.Zhongshan Guangdong Guangzhou Guangdon g Expressway Management 15.00% Equity method Ganzhou kangda Expressway Co. Ltd.Gangzhou Jiangxi Gangzhou Jiangxi Expressway Management 30.00% Equity method Ganzhou Gankang Expressway Co. Ltd.Gangzhou Jiangxi Gangzhou Jiangxi Expressway Management 30.00% Equity method Guangdong Yueke Technology Petty Loan Co. Ltd.Guangzhou Guangdong Guangzhou Guangdong Hande all kinds of small loans 20.00% Equity method Guangyuan Securities Co. Ltd.Hefei Anhui Hefei Anhui Security business 2.37% Equity method Hunan Lianzhi Technology Co. Ltd. Changsha Changsha Research and experimental development 10.10% Equity method Notes to holding proportion of joint venture or associated enterprise different from voting proportion: None Basis of holding less than 20% of the voting rights but has a significant impact or holding 20% or more voting rights but does not have a significant impact: Guangdong Jiangzhong Expressway Co. Ltd. Guangyuan Securities Co. Ltd..and Hunan Lianzhi Technology Co.Ltd. holds 20% of the voting rights but has the power to participate in making decisions on their financial and ope rating decisions and therefore deemed to be able to exert significant influence over the investee. (2) Main financial information of significant joint venture None (3) Main financial information of significant associated enterprise In RMB Year-end balance/ Amount of current period Year-beginning balance/ Amount of previous period Guoyuan Securities Co. Ltd. Guoyuan Securities Co. Ltd. Current assets 57918624287.41 Non-current assets 26015472537.63 Total assets 90751959774.27 83934096825.04 Current liabilities 46206352399.19 Non-current Liabilities 12890023021.47 Total liabilities 59096375420.66 Minority Shareholders’ Equity 11785075.26 Shareholders’ equity attributable to shareholders of the parent 30860056478.72 24825936329.12 Pro rata share of the net assets calculated 731815047.62 587200989.50 --Goodwill 207095632.54 206725818.02 The book value of equity investments in joint ventures 938910680.16 793926807.52 Fair value of equity investment of associated enterprises with open quotation 927203934.72 737910410.22 Buinsess incme 4579605087.78 3302720958.61 Net profit 917476547.45 Other comprehensive income 95017342.59 Total comprehensive income 1012493890.04 Dividends received from associates duri ng the year 11940297.90 19900496.50 Other note (4) Summary financial information of insignificant joint venture or associated enterprise In RMB Year-end balance/ Amount of current period Year-beginning balance/ Amount of previous period Joint venture： -- -- Total amount of the pro rata calculation of the following items -- -- Associated enterprise： -- -- Total book value of the investment 1443470485.44 1413339517.32 Total amount of the pro rata calculation of the following--Net profit ms -- -- -Nit profit 82311895.95 147340576.39 --Total comprehensive income 82311895.95 147340576.39 Note As the book value of the long-term equity investment in the associated enterprises and joint ventures except those listed in (2) and (3) in the current period and in 2018 and 2019 is not higher than 5% of the total owner's equity attributable to the parent company the Company considers that all associated enterprises and joint ventures except the important associated enterprises and joint ventures listed in (2) and (3) are non-important associated enterprises and joint ventures. (5) Note to the significant restrictions of the ability of joint venture or associated enterprise transfer funds to the Company None (6) The excess loss of joint venture or associated enterprise None (7) The unrecognized commitment related to joint venture investment None (8) Contingent liabilities related to joint venture or associated enterprise investment None 4. Significant common operation None 5. Equity of structure entity not including in the scope of consolidated financial statements None X. Risks Related to Financial Instruments The company has the main financial instruments such as bank deposits receivables and payables investments loans and so on. Please refer to the relevant disclosure in Notes for the details. The risks associated with these financial instruments mainly include credit risk market risk and liquidity risk. The company’s management shall manage and monitor these risks and ensure above risks to be controlled within certain scope.(I)The targets and policies of risk management The target of risk management is to obtain the proper balance between the risk and benefit to reduce the negative impact that is caused by the risk of the Company to the lowest level and to maximize the benefits of shareholders and other equity investors. Based on the targets of risk management the basic strategy of the Company’s risk management is to identify and analyze the risks which are faced by the Company establish suitable risk tolerance baseline and proceed the risk management and supervise a variety of risks timely and reliably and control the risks within a limited range. 1.Market risk （1）Foreign exchange risk Foreign exchange risk refers to the risk of loss due to exchange rate fluctuations generally. Our foreign exchange risk is mainly related to Hong Kong Dollar. Besides annual distribution of B-share shareholder dividends other major business activities of our Company are settled in RMB. During the reporting period due to the short credit period of the Company's income and expenditure related to foreign currency it was not affected by foreign exchange risk. （2）Interest rate risk The Company's risk of cash flow changes in financial instruments caused by interest rate changes is mainly related to floating rate bank borrowings (see this Section VII 27). The Company's policy is to maintain the floating interest rate of these borrowings and at the same time to reasonably reduce the risk of interest rate fluctuation by shortening the term of a single loan and specifically agreeing on prepayment terms. （3）Other price risk The investments held by the Company are classified as financial assets measured at fair value and whose changes are included in other comprehensive income (financial assets available for sale on or before December 31 2018) and are measured at fair value on the balance sheet date. Therefore the Company bears the risk of changes in the securities market. 2.Credit risk On December 31 2020 the largest credit risk exposure that may cause financial losses of the Company mainly comes from the loss of financial assets of the Company caused by the failure of the other party to perform its obligations.In order to reduce credit risk the Company only deals with recognized and reputable customers. In addition the Company reviews the recovery of each single receivables on each balance sheet date to ensure that adequate bad debt provisions are made for unrecoverable amounts. Consequently the Company's management believes that the Company's credit risk has been greatly reduced.The Group's working capital is deposited in banks with higher credit rating so the credit risk of working capital is relatively low. Financial assets overdue or impaired; (1) Aging analysis of financial assets with overdue impairment: Not existed (2) Analysis of financial assets that have suffered single impairment: Refer to " 4 and Other Receivables" in 10 Investment in Other Equity Instruments" in VII of this section for details. 3.Liquidity risk When managing liquidity risks the Company maintains sufficient cash and cash equivalents as deemed by the management and monitor them to meet the Company's operational needs and reduce the impact of cash flow fluctuations. The management of the Company monitors the use of bank loans and ensures compliance with the loan agreement.XI. The disclosure of the fair value 1. Closing fair value of assets and liabilities calculated by fair value In RMB Items Closing fair value Fir value measurement items at level 1 Fir value measurement items at level 2 Fir value measurement items at level 3 Total I. Consistent fair value measurement -- -- -- -- （3）Other equity instrument investment 938667226.56 748348301.73 1687015528.29 Total assets continuously measured at fair value 938667226.56 748348301.73 1687015528.29 II. Non –persistent measure -- -- -- -- 2. Market price recognition basis for consistent and inconsistent fair value measurement items at level 1. As at the end of the period the company holds shares 235254944 shares of China Everbright Bank According to the closing price of December 31 2020 of 3.99 yuan the final calculation of fair value was 938667226.56 yuan. 3. Fair value of financial assets and liabilities not measured at fair value The valuation techniques adopted and the qualitative and quantitative information of important parameters for continuous and non-continuous level 3 fair value measurement items Items Fair value as of December 31 2020 Valuation technology Unobservable input value Investment in equity instruments Unlisted equity investment 748348301.73Discounted method of future cash flow Discount rate Due to the lack of recent information on the fair value of some other equity instruments and no significant change in the operation of the invested company the Company takes the cost as its fair value estimate. 4. Fair value of financial assets and liabilities not measured at fair value The Company's financial assets and liabilities measured in amortized cost mainly include: accounts receivable other receivables contract assets short-term loans accounts payable other payables non-current liabilities due within one year long-term loans bonds payable and long-term payables.There is no significant difference between the book value of financial assets and liabilities not measured at fair value and the fair value.XII. Related parties and related-party transactions 1. Parent company information of the enterprise Name Registered address Nature Redistricted capital The parent company of the Company's shareholding ratio The parent company of the Company’s vote ratio Guangdong communication Group Co. Ltd Guangzhou Equity management traffic infrastructure construction and railway project operation 26.8 billion yuan 24.56% 50.12% Notes ： Guangdong Communication Group Co. Ltd. is the largest shareholder of the Company. legal representative: Deng Xiaohua. Date of establishment: June 23 2000. As of December 31 2020Registered capital: 26.8 billion yuan. It is a solely state-owned limited company. Business scope：equity management organization of asset reorganization and optimized allocation raising funds by means including mortgage transfer of property rights and joint stock system transformation project investment operation and management traffic infrastructure construction highway and railway project operation and relevant industries technological development application consultation and services highway and railway passenger and cargo transport ship industry relevant overseas businesses; The value-added communication business.The finial control of the Company was State owned assets supervision and Administration Commission of Guangdong Provincial People's Government. 2.Subsidiaries of the Company Subsidiaries of this enterprise see IX(1) the rights of other entity 3. Information on the joint ventures and associated enterprises of the Company Details refer to the IX-3 Interests in joint ventures or associates Information on other joint venture and associated enterprise of occurring related party transactions with the Company in reporting period or form balance due to related party transactions in previous period: Name Relation with the Company Shenzhen Huiyan Expressway Co. Ltd. Associated enterprises of the Company Zhaoqing Yuezhao Highway Co. Ltd. Associated enterprises of the Company Ganzhou Kangda Expressway Co. Ltd. Associated enterprises of the Company Ganzhou Gankang Expressway Co. Ltd. Associated enterprises of the Company Guangdong Jiangzhong Expressway Co. Ltd. Associated enterprises of the Company Guangdong Yueke Technology Petty Loan Co. Ltd. Associated enterprises of the Company Hunan Lianke Technology Co. Ltd. Associated enterprises of the Company 4. Other Related parties Name Relation with the Company Guangdong Boda Expressway Co. Ltd. Fully owned subsidiary of the parent company Guangdong Chaohui Expressway Co. Ltd. Fully owned subsidiary of the parent company Guangdong East Thinking Management Technology Development Co. Ltd. Fully owned subsidiary of the parent company Guangdong Gaoda Property Development Co. Ltd. Fully owned subsidiary of the parent company Guangdong Gaoen Expressway Co. Ltd. Fully owned subsidiary of the parent company Guangdong Expressway Media Co. Ltd. Fully owned subsidiary of the parent company Guangdong Guangfozhao Expressway Co. Ltd. Fully owned subsidiary of the parent company Guangdong Guangle Expressway Co. Ltd. Fully owned subsidiary of the parent company Guangdong Guangzhu West Line Expressway Co. Ltd. Fully owned subsidiary of the parent company Guangdong Humen Bridge Co. Ltd. Fully owned subsidiary of the parent company Guangdong Hualu Traffic Technology Co. Ltd. Fully owned subsidiary of the parent company Guangdong Jiaotong Testing Co. Ltd Fully owned subsidiary of the parent company Guangdong Traffic Industry Investment Co. Ltd. Fully owned subsidiary of the parent company Guangdong Kaiyang Expressway Co. Ltd. Fully owned subsidiary of the parent company Name Relation with the Company Guangdong Litong Technology Investment Co. Ltd. Fully owned subsidiary of the parent company Guangdong Lulutong Co. Ltd. Fully owned subsidiary of the parent company Guangdong Union Electron Service Information technology Co. ltd. Fully owned subsidiary of the parent company Guangdong Union Electron Service Co. ltd. Fully owned subsidiary of the parent company Guangdong Lulutong Co. Ltd. Fully owned subsidiary of the parent company Guangdong Luoyang Expressway Co. Ltd. Fully owned subsidiary of the parent company Guangdong Maozhan Expressway Co. Ltd. Fully owned subsidiary of the parent company Guangdong Shanfen Expressway Co. ltd. Fully owned subsidiary of the parent company Guangdong Provincial Freeway Co.Ltd. Fully owned subsidiary of the parent company Guangdong Highway Construction Co. Ltd. Fully owned subsidiary of the parent company Guangdong Communication Group Finance Co. Ltd. Fully owned subsidiary of the parent company Guangdong Read & Bridge Construction Development Co.Ltd. Fully owned subsidiary of the parent company Guangdong Taishan Coastal Expressway Co. Ltd. Fully owned subsidiary of the parent company Guangdong Tongyi Expressway Service Area Co. Ltd Fully owned subsidiary of the parent company Guangdong Xinyue Traffic Investment Co. Ltd. Fully owned subsidiary of the parent company Guangdong Yangmao Expressway Co. Ltd. Fully owned subsidiary of the parent company Guangdong Yuedong Expressway Industry Development Co.Ltd.(Cancelled) Fully owned subsidiary of the parent company Guangdong Yuegan Expressway Co. Ltd. Fully owned subsidiary of the parent company Guangdong Yueyun Traffic Co. Ltd. Fully owned subsidiary of the parent company Guangdong Yueyun Traffic Rescue Co. Ltd. Fully owned subsidiary of the parent company Guangdong Zhaoyang Expressway Co. Ltd. Fully owned subsidiary of the parent company Guangshenzhu Expressway Co. Ltd. Fully owned subsidiary of the parent company Guangzhou Xinyue Traffic Technology Co. Ltd. Fully owned subsidiary of the parent company Guangzhou Xinyue Asphalt Co. Ltd. Fully owned subsidiary of the parent company Guangzhou Yueyun Traffic Co. Ltd. Fully owned subsidiary of the parent company Guangdong Humen Bridge Co. Ltd. Fully owned subsidiary of the parent company Yunfo Guangyun Expressway Co. Ltd. Fully owned subsidiary of the parent company Guangdong Tianlu New Energy Investment Co. Ltd. Fully owned subsidiary of the parent company Guangdong Communication Planning & Design Institute Co.Ltd.Shares of parent company Guangzhongjiang Expressway Project Management Dept Managed by the parent company Name Relation with the Company Hongkong- Zhuhai-Macao Connection line management center Managed by the parent company GuangzhouAitesi Communication equipment Co. Ltd. Shares of enterprised controlled by the same parent company Jiangmen Jianghe Expressway Co. Ltd. Shares of enterprised controlled by the same parent company Guangdong Shenshan Expressway Co. Ltd. Shares of enterprised controlled by the same parent company Guangdong Jingzhu Expressway Guangzhu North Section Co.Ltd.Shares of enterprised controlled by the same parent company Foshan Guangshan Expressway Co. Ltd. Shares of enterprised controlled by the same parent company Guangdong Feida Traffic Engineering Co. Ltd. Shares of enterprised controlled by the same parent company Poly Changda Engineering Co. Ltd. Shares of parent company Guangdong Changda Road Conservation Co. Ltd. A subsidiary Shares of parent company Guangdong Road Network Digital Media Information Technology Co. Ltd Fully owned subsidiary of the parent company Guangdong Xiangfei Highway Engineering Supervision Co.Ltd Fully owned subsidiary of the parent company Guangdong Jiangzhao Expressway Management Center Fully owned subsidiary of the parent company 5. List of related-party transactions (1)Information on acquisition of goods and reception of labor service Acquisition of goods and reception of labor service In RMB Related parties Content of related transaction Amount of current period Amount of previous period Over the trading limit or not? Amount of last period 1.Business cost Boly Changda Engineering Co. Ltd.Project fund service 43663945.00 43216399.22 Guangdong Lulutong Co. Ltd. Project funds 36627747.85 6465863.46 Guangdong Union electronic services co. Ltd.Service 22140969.83 27828355.00 Guangdong Xinyue Asphalt Co.Ltd.Purchase 13627554.77 423213.90 Guangdong Jiaoke Testing Co. Project 10948746.94 6007217.92 Related parties Content of related transaction Amount of current period Amount of previous period Over the trading limit or not? Amount of last period Ltd.Guangdong Communication Planning & Design Institute Co.Ltd.Project labour service 8136858.45 1612868.00 Guangdong Feida Traffic Engineering Co. Ltd. Maintenance 7314621.02 3807139.23 Guangdong Xinyue traffic Investment Co. Ltd.Maintenance Project 5947406.32 3020562.88 Guangdong Hualu Traffic Technology Co. Ltd.Project 4869113.63 2832988.81 GuangzhouAitesi Communication Equipment Co. Ltd. Project 1771681.42 Guangdong Litong Technology Investment Co. Ltd.Maintenance 1424414.80 5285628.86 Guangdong Tongyi Expressway Service Area Co. Ltd Service 604826.78 225055.47 Guangdong Humen Bridge Co.Ltd.Service 528929.83 1047385.24 Guangdong East Thinking Management Technology Development Co. Ltd. Maintenance，Service 282800.00 105850.00Guangdong Expressway Media Co. Ltd. Advertising 128431.80 Guangdong Jingzhu Expressway Guangzhu North Section Co. Ltd.Service 107017.44 107017.44 Guangzhou Xinyue Traffic Technology Co. Ltd.Project 3377412.00 Subtotal 158125065.88 105362957.43 2.Financial cost Guangdong Communication Group Finance Co. Ltd. Borrowing Interest expresses 2240000.00 Guangdong Jiangzhong Principal Loan Interest 1432890.00 1428975.00 Related parties Content of related transaction Amount of current period Amount of previous period Over the trading limit or not? Amount of last period Expressway Co. Ltd. Expenditure Subtotal 3672890.00 1428975.00 3.Administrative expenses Guangdong Litong Property Investment Co. Ltd.Management Fee 2787764.02 Guangdong East Thinking Management Technology Development Co. Ltd. Maintenance，Service 1048608.53 582500.00Guangdong Tongyi Expressway Service Area Co. Ltd Service 57955.00 87189.00 Guangdong Lulutong Co. Ltd. Maintenance charges 38400.00 48000.00 Subtotal 3932727.55 717689.00 4.Intangible assets Guangdong East Thinking Management Technology Development Co. Ltd. Purchase assets 231017.70 462500.00 Guangdong Litong Technology Investment Co. Ltd.Purchase assets 301800.00 Subtotal 231017.70 764300.00 5.Fixed assets Guangdong Xinyue Traffic Investment Co. Ltd.Purchase assets 8327087.05 Guangdong East Thinking Management Technology Development Co. Ltd. Purchase assets 2939612.48 358440.98 Guangdong Lualu Traffic Technology Co. Ltd.Purchase assets 1263639.96 Guangdong Communication Planning & Design Institute Co.Ltd.Purchase assets 1141056.00 Poly Changda Engineering Co.Ltd.Purchase assets 803433.00 Related parties Content of related transaction Amount of current period Amount of previous period Over the trading limit or not? Amount of last period Guangdong Lulutong Co. Ltd. Purchase assets 774003.00 Guangdong Feida Traffic Engineering Co. Ltd. Purchase assets 255165.00 Subtotal 15503996.49 466740.98 6.Construction in process Poly Changda Engineering Co.Ltd.Purchase assets 174118816.33 354252263.97 Guangdong Highway Construction Co. Ltd. Purchase assets 32720641.48 Guangdong Communication Planning & Design Institute Co.Ltd.Purchase assets 6549774.00 Guangzhou Xinyue Asphalt Co.Ltd.Purchase assets 6094415.27 Guangdong Xinyue Traffic Investment Co. Ltd.Purchase assets 6093672.62 14193117.28 Guangdong Hualu Traffic Technology Co. Ltd.Purchase assets 4965661.48 7293946.75 Guangdong Jiaoke Testing Co.Ltd.Purchase assets 4924163.50 45030.00 Guangdong Feida Traffic Engineering Co. Ltd. Purchase assets 4456756.00 7547509.00 Guangdong Xiangfei Highway Supervision Co. Ltd.Purchase assets 188644.00 Guangdong Litong Technology Investment Co. Ltd.Purchase assets 26373280.00 Guangdong Lulutong Co. Ltd. Purchase assets 969546.53 Subtotal 240112544.68 410674693.53 7.Non-operating expenses Guangdong Lulutong Co. Ltd. Maintenance 222410.00 Guangdong Litong Technology Investment Co. Ltd. Equipment 11000.00 Related parties Content of related transaction Amount of current period Amount of previous period Over the trading limit or not? Amount of last period Subtotal 233410.00 Related transactions on sale goods and receiving services In RMB Related party Content Amount of current period Amount of previous period 1.Business income Jingzhu Expressway Guangzhu North section Co. Ltd. Commission management fee 19593901.34 20047032.07 Guangdong Provincial Freeway Co.Ltd. Project fund 4382576.33 4310630.18 Guangdong Feida Traffic Engineering Co.Ltd CPC card sales revenue 2621638.92 871473.15 Guangdong Union electronic services co.Ltd.Promotion fees 1479844.56 999971.70 Guangdong Tongyi Expressway Service Area Co. Ltd water and electricity 1256761.24 Guangdong Road Construction Development Co. Ltd. Project fund 1122174.65 1574566.33 Zhaoqing Yuezhao Highway Co. Ltd.Salary income and testing fee for expatriate staff 1044069.06 2155810.23 Shenzhen Huiyan Expressway Co. Ltd.Salary income and testing fee for expatriate staff 944060.56 1121184.34 Ganzhou Gankang Expressway Co. Ltd. Salaries of expatriate staff 594631.40 737114.13 Ganzhou Kangda Expressway Co. Ltd. Salaries of expatriate staff 590288.43 513990.93 Guangdong Jiangzhong Expressway Co.Ltd.Salary income project payment etc 530534.64 635673.34 Guangdong Chaohui Expressway Co. Ltd. Test 422830.19 425905.66 Guangdong Road & Bridge Construction Development Co. Ltd. Test 394211.89 2144812.90 Guangdong Guangzhu West Line Expressway Co. Ltd. Service test 333636.67 751475.04 Related party Content Amount of current period Amount of previous period Guangdong Yangmao Expressway Co. Ltd. Service test 333264.32 166981.13 Guangdong Boda Expressway Co. Ltd. Test 295325.43 730270.82 Guangdong Maozhan Expressway Co. Ltd. Service test 277482.05 418867.92 Guangdong Kaiyang Expressway Co. Ltd. Test 237735.85 380652.28 Guangdong Guangle Expressway Co. Ltd. Test 222169.81 300849.06 Poly Changda Engineering Co. Ltd. water and electricity 200087.71 Guangdong Zhaoyang Expressway Co. Ltd. Test 150000.00 236460.18 Guangdong Guangfozhao Expressway Co.Ltd.Test 142641.51 331283.02 Guangdong Xinyue Traffic Investment Co.Ltd. CPC card sales revenue 128993.83 2208097.34 Guangdong Luoyang Expressway Co. Ltd. Test 107547.17 107547.17 Guangdong Traffic Industry Investment Co.Ltd.Test 90566.04 90566.04 Guangdong Gaoen Expressway Co. Ltd. Test 79245.28 79245.28 Yunfo Gufangyun Expressway Co. Ltd. Test 65377.36 164469.85 Jiangmen Jianghe Expressway Co. lTD. Test 57547.17 110377.36 Guangdong Road Nework Digital Media Information Technology Co. Ltd. Advertising 34218.33 Guangdong Humen Bridge Co. Ltd. Test 33962.26 60849.06 Guangdong Expressway Media Co. Ltd. water and electricity 23053.70 44213.00 Guangdong Yueyun Traffic Co. Ltd. Test 11320.75 42452.83 Guangshenzhu Expressway Co. Ltd. Service 8407.08 114655.17 Guangdong Jiangzhao Expressway Co. Ltd. Project 130188.68 Foshan Guangshan Expressway Co. Ltd. Project 120283.02 Guangdong Taishan coastal Expressway Co.Ltd.Project -59433.96 Guangzhongjiang Expressway Project Management Dept Project -89622.64 Subtotal 37810105.53 41978892.61 2.Non-operating income Poly Changda Engineering Co. Ltd. Construction penalty 93754.00 Guangdong Xinyue Traffic Investment Co. Construction penalty 5300.00 Related party Content Amount of current period Amount of previous period Ltd.Subtotal 99054.00 (2) Information of related lease The Company was lessor： In RMB Name of lessee Category of lease assets The lease income confirmed in this year The lease income confirmed in last year Guangdong Expressway Media Co. Ltd. Advertising lease 4598128.21 3556249.10 Guangdong Tongyi Expressway Service Area Co. Ltd Service Area Lease 2297830.86 2297830.86 Guangdong Litong Technology Investment Co. Ltd. Communication Piping 1030735.24 930872.38 Guangdong Litong Technology Investment Co. Ltd.Land lease 37690.80 - The company was lessee： In RMB Lessor Category of leased assets The lease income confirmed in this year Category of leased assets Guangdong Litong Real Eatate Investment Co. Ltd Office space 9208532.51 8876387.85 Zhaoqing Yuezhao Highway Co. Ltd. Advertising column lease 253230.00 248061.50 Guangzhou Yueyun Traffic Co. Ltd. Car rental fee 187200.00 190640.78 Guangdong Gaoda Property Development Co. Ltd. Office space 102969.27 95436.00 Zhaoqing Yuezhao Highway Co. Ltd. Equipment lease 116504.86 Guangdong Kaiyang Expressway Co. Ltd. Equipment lease 106194.69 Guangdong Maozhan Expressway Co. Ltd. Equipment lease 106194.69 (4) Inter-bank lending of capital of related parties In RMB Related party Amount borrowed and loaned Initial date Due date Notes Borrowed Guangdong Jiangzhong Expressway Co Loaned. Ltd. 36000000.00 November 142018 November 132023 Guangdong Communication Group Finance Co. Ltd. 200000000.00 August 262020 August 252021 Loaned (5) Rewards for the key management personnel In RMB Items Amount of current period Amount of previous period Rewards for the key management personnel 6541500.00 7604100.00 (6) Other related-party transactions -Capital Deposit Situation of Guangdong Provincial Communication Group Finance Co. Ltd. In RMB Items Amount of current period Amount of previous period Balance of Deposit 1031105792.71 813272070.75 Including ： Guangdong Provincial Expressway Development Co. Ltd.（Not include Guanghui） 90107522.98 813272070.75 Guangdong Guanghui Expressway Co. Ltd. 940998269.73 Interest revenue 14429931.26 8705455.79 Including ： Guangdong Provincial Expressway Development Co. Ltd.（Not include Guanghui） 13058886.79 8705455.79 Guangdong Guanghui Expressway Co. Ltd. 2869377.80 Pricing Principle Reference to the deposit rate of the people's Bank of China for the same period On December 25 2017 and December 22 2017 the Company signed the Cash Management Business Cooperation Agreement with Guangdong Communications Group Finance Co. Ltd. and Industrial and Commercial Bank of China Guangdong Branch and signed the Cash Management Business Cooperation Agreement with Guangdong Communications Group Finance Co. Ltd. and China Construction Bank Corporation. Guangdong Branch respectively to join in the cash pool of Guangdong Communications Group Finance Co. Ltd.On May 19 2020 Guangdong Guanghui Expressway Co. ltd. signed the Cash Management Business Cooperation Agreement with Guangdong Communications Group Finance Co. Ltd. and Agricultural Bank of China Guangdong Branch and signed the Cash Management Business Cooperation Agreement with Guangdong Communications Group Finance Co. Ltd. to join in the cash pool of Guangdong Communications Group Finance Co. Ltd. -On June 15 2016The company’ s 29th meeting (Provisional) of the seventh board of directors was convened. The Proposal on Entrustment of Construction Management of the Renovation and Expansion Project of Sanbao-to-Shuikou Section of Shengyang-to-Haikou National Expressway was deliberated in the meeting agreed that Guangdong Provincial Fokai Expressway Co. Ltd entrusts Guangdong Provincial Highway Construction Co.Ltd with the construction management of the renovation and expansion project of Sanbao-to-Shuikou Section of Shengyang-to-Haikou National Expressway and handling the related matters of the entrustment of the construction management. 6. Receivables and payables of related parties （1）Receivables In RMB Name Related party Amount at year end Amount at year beginning Balance of Book Bad debt Provision Balance of Book Bad debt Provision Contract assets Guangdong Xinyue Traffic Investment Co.Ltd. 119242.50 127567.50 Contract assets Guangdong Road & Bridge Construction Development Co. ltd. 25262.45 83391.05 Contract assets Zhaoqing Yuezhao Expressway Co. Ltd. 22667.85 41442.48 Contract assets Guangdong Feida Traffic Engineering Co.Ltd. 48230.00 48230.00 Contract assets Guangzhenzhu Expressway Co. Ltd. 9096.00 9096.00 Contract assets Guangdong Jiangzhong Expressway Co.Ltd. 8412.00 8412.00 Contract assets Guangdong Road Construction Development Co. ltd. 7200.00 7200.00 Contract assets Guangdong Boda Expressway Co. Ltd. 4530.99 4531.00 Contract assets Guangdong Humen Bridge Co. Ltd. 2700.00 2700.00 Contract assets Guangdong Provincial Freeway Co.Ltd. 41377.00 Contract assets Guangdong Guangzhu West Line Expressway Co. Ltd. 18781.60 Contract assets Guangdong Shenshan Expressway East Section Co. Ltd. 12000.00 Contract assets Guangdong Litong Technology Investment Co. Ltd. 5273.00 Name Related party Amount at year end Amount at year beginning Balance of Book Bad debt Provision Balance of Book Bad debt Provision Total 247341.79 410001.63 Account receivable Guangdong Union electron Service Co.Ltd. 100047025.70 92786286.61 Account receivable Guangdong Humen Bridge Co. Ltd. 11044082.54 16698073.73 Account receivable Jingzhu Expressway Guangzhu North Section Co. Ltd. 5980163.99 6174264.00 4450.00 Account receivable Guangdong Expressway Media Co. Ltd. 1966548.00 1909300.00 Account receivable Guangdong Feida Traffic Engineering Co.Ltd. 3274356.00 45916.00 1423875.25 103072.45 Account receivable Guangdong Road Construction Co. ltd. 1037305.45 65491.20 336946.45 3818.00 Account receivable Guangdong Xinyue Traffic Investment Co.Ltd. 300009.20 148208.50 2334682.70 160715.94 Account receivable Guangdong Guangzhu West Line Expressway Co. Ltd. 223500.00 384226.00 Account receivable Guangzhenzhu Expressway Co. Ltd. 69736.00 115278.40 Account receivable Guangdong Road & Bridge Construction Development Co. ltd. 61891.30 567957.47 Account receivable Guangdong Boda Expressway Co. Ltd. 22740.00 537848.00 Account receivable Guangdong Provincial Freeway Co.Ltd. 21232.00 175248.90 Account receivable Guangdong Jiangzhong Expressway Co.Ltd. 19708.00 19708.00 Account receivable Guangdong Yueyun Traffic Co. Ltd. 15032.00 3032.00 Account receivable Guangdong Chaohui Expressway Co. Ltd. 7367.20 Account receivable Guangdong Guangle Expressway Co. Ltd. 7248.00 7248.00 Account receivable Guangdong Litong Technology Investment Co. Ltd. 68542.00 Name Related party Amount at year end Amount at year beginning Balance of Book Bad debt Provision Balance of Book Bad debt Provision Account receivable Guangdong Maozhan Expressway Co.Ltd. 8747.20 Account receivable Guangdong Shanfen Expressway Co. Ltd. 8028.80 Account receivable Guangdong Yuedong Expressway Industry Development Co. Ltd. 7367.20 Account receivable Jiangmen Jianghe Expressway Co. Ltd. 2539.20 Total 124097945.38 259615.70 123569199.91 272056.39 Advanced payment Guangdong Litong Real Estate Investment Co. Ltd. 776413.03 735092.38 Advanced payment Zhaoqing Yuezhao Highway Co. Ltd. 151938.00 144703.00 Advanced payment Guangdong Feida Traffic Engineering Co.Ltd. 149400.00 Total 1077751.03 879795.38 Dividend Receivable Ganzhou Gankang Expressway Co. Ltd. 1500000.00 Dividend Receivable Guangdong Yueke Technology Petty Loan Co. Ltd. 6000000.00 Total 1500000.00 6000000.00 Other Account receivable Ganzhou Gankang Expressway Co. Ltd. 45000000.00 Other Account receivable Guangdong Litong Real Estate Investment Co. Ltd. 1666147.36 1515077.22 Other Account receivable Guangdong Expressway Media Co. Ltd. 1218110.44 896321.01 Other Account receivable Guangdong Guanghui Expressway Co.Ltd. 463491.88 463491.88 Other Account receivable Zhaoqing Yuezhao Highway Co. Ltd. 350000.00 390000.00 Other Account receivable Guangshenzhu Expressway Co. Ltd. 60640.00 60640.00 Other Account receivable Guangdong Union electron Service Co.Ltd. 50000.00 50000.00 Name Related party Amount at year end Amount at year beginning Balance of Book Bad debt Provision Balance of Book Bad debt Provision Other Account receivable Guangdong Boda Expressway Co. Ltd. 22740.00 22740.00 Other Account receivable Guangdong Gufangzhu West Line Expressway Co. Ltd. 20000.00 20000.00 Other Account receivable Guangdong Gaoda Property Development Co. ltd. 16268.00 15906.00 Other Account receivable Poly Changda Engineering Co. Ltd. 10124.14 192169.95 Other Account receivable Guangdong Xinyue Traffic Investment Co.Ltd. 5340.03 3477.00 Other Account receivable Hongkong Zhuhai Macao Bridge Connection line management center 3000.00 Total 48882861.85 3632823.06 Other Non-Current Assets Poly Changda Engineering Co. Ltd. 11599273.00 48400293.16 Other Non-Current Assets Guangdong Road Construction Co. Ltd. 7089990.48 Other Non-Current Assets Guangdong Tianlu New Energy Investment Co. Ltd. 333398.00 Other Non-Current Assets Guangdong Hualu Traffic Technology Co.Ltd. 277117.00 Total 19022661.48 48677410.16 Long-term amortization costs Guangdong Jingzhu Expressway Guangzhu North Section Co. Ltd. 1007747.00 1114764.44 Total 1007747.00 1114764.44 （2）Payables In RMB Name Related party Amount at year end Amount at year beginning Short-term loans Guangdong Communication Group Finance Co.Ltd. 200192500.00 Total 200192500.00 Account payable Guangzhongjiang Expressway Project Management Dept 28000000.00 28000000.00 Account payable Poly Changda Engineering Co. Ltd. 25621536.30 48505079.52 Account payable Guangdong Xinyue Traffic Investment Co. Ltd 13149675.40 5496352.70 Account payable Guangdong Communication Planning & Design Institute Co. Ltd. 8929645.80 6013501.73 Account payable Guangdong Provincial Freeway Co.Ltd. 8746491.18 8746491.18 Account payable Guangdong Lulutong Co. Ltd. 3560871.60 3674959.44 Account payable Guangdong Hualu Traffic Technology Co. Ltd. 2198660.67 877441.72 Account payable Guangdong East Thinking Management Technology Development Co. Ltd. 1584416.70 474000.00 Account payable Guangzhou Aitesi Communication Equipment Co.Ltd. 1283018.78 Account payable Guangdong Feida Traffic Engineering Co. Ltd. 500864.10 7588881.23 Account payable Guangdong Changda Road Maintenance Co. Ltd. 309101.00 309101.00 Account payable Guangdong Yueyun Traffic Co. Ltd. 268021.00 Account payable Guangdong Union Electron Service Co.Ltd. 254011.26 2661544.84 Account payable Guangdong Jiaoke Testing Co. Ltd. 88880.00 317105.00 Account payable Guangdong Litong Technology Investment Co.Ltd. 85074.95 3307587.00 Account payable Guangzhou Xinyue Asphalt Co. Ltd. 47362.94 46779.00 Account payable Guangdong Road Construction Co. Ltd. 25630651.00 Account payable Guangzhou Xinyue Traffic Technology Co. Ltd. 2279061.00 Total 94627631.68 143928536.36 Advance received Guangdong Road Network Digital Media Information Technology Co. Ltd. 2777.78 Total 2777.78 Other Payable account Guangdong Provincial Freeway Co.Ltd. 1221839292.00 Other Payable account Poly Changda Engineering Co. Ltd. 20042113.05 30447877.47 Other Payable account Guangdong Xinyue Traffic Investment Co. Ltd. 1889981.61 2533921.10 Other Payable account Guangdong Feida Traffic Engineering Co. Ltd. 1700740.34 2203127.20 Name Related party Amount at year end Amount at year beginning Other Payable account Guangdong Changda Road Maintenance Co. Ltd. 1630765.00 1630765.00 Other Payable account Guangdong Hualu Traffic Technology Co. Ltd. 1327451.00 1078565.88 Other Payable account Guangdong Lulutong Co. Ltd. 1084995.15 230261.43 Other Payable account Guangdong Union Electron Service Co.Ltd. 956272.04 367300.00 Other Payable account Guangzhou Xinyue Asphalt Co. Ltd. 567221.00 Other Payable account Guangdong Communication Planning & Design Institute Co. Ltd. 238479.70 216749.70 Other Payable account Guangzhongjiang Expressway Project Management Dept 200000.00 200000.00 Other Payable account Guangzhou Xinyue Traffic Technology Co. Ltd. 171809.00 171809.00 Other Payable account Guangdong Litong Technology Investment Co.Ltd. 167591.50 247070.50 Other Payable account Guangdong Tongyi Expressway Service Area Co.Ltd. 120000.00 120000.00 Other Payable account Guangdong Expressway Media Co. Ltd. 70000.00 70000.00 Other Payable account Guangdong East Thinking Management Technology Development Co. Ltd. 58991.40 439523.40 Other Payable account Guangdong Yueyun Traffic Rescue Co. Ltd. 900.00 900.00 Other Payable account Guangdong Yuegan Expressway Co. Ltd. 1000.00 Total 1252066602.79 39958870.68 Non-current liabilities due 1 year Guangdong Jiangzhong Expressway Co. Ltd. 43065.00 43065.00 Total 43065.00 43065.00 Long-term payable Guangdong Jiangzhong Expressway Co. Ltd. 36000000.00 36000000.00 Total 36000000.00 36000000.00 7. Related party commitment None XIII. Stock payment 1. The Stock payment overall situation □Applicable √ Not applicable 2. The Stock payment settled by equity □Applicable √ Not applicable 3. The Stock payment settled by cash □Applicable √ Not applicable 4. Modification and termination of the stock payment None XIV. Commitments 1. Significant commitments Significant commitments at balance sheet date （1）Capital commitment On June 15 2016 the Company’s 29th meeting (Provisional) of the seventh board of directors was convened. In the meeting the Proposal on Increasing Funding for Guangdong Fokai Expressway Co. Ltd pertaining to the Renovation and Expansion Project of Sanbao-to-Shuikou Section of Shengyang-to-Haikou National Expressway was examined and approved agreed that based on the approved total investment amount by relevant government department then the company’s subsidiary- Guangdong Fokai Expressway Co. Ltd carries out the investment and construction of the renovation and expansion project of Sanbao-to-Shuikou Section of Shengyang-to-Haikou National Expressway; the company increases funding for Guangdong Provincial Fokai Expressway Co. Ltd pertaining to the renovation and expansion project of Sanbao-to-Shuikou Section of Shengyang-to-Haikou National Expressway with the contributed funds as a proportion of 35% of the total investment amount approved by relevant government department. The afore-said item had been examined and approved in the first extraordinary general shareholder meeting The Company had received the approval of the National Development and Reform comission about the uandongProvincial Santbao-Shuikou Expressway Section Rebubuilding and Expansion Project(NO.1874-2016-NDRC Infrastructure Document)from Guangdong Provincel Development and reform Commission On October 11 2016 agreed with the implementation of the Guangdong Provincial Sanbao-Shuikou Expressway Section Rebuilding and Expansion Project. It’s estimated that the total investment of this project is about 3.513 billion yuan(the static investment is about 3.289 billion yuan) of which the project capital is 1.23 billion yuan that accounts for 35% of the total investment and such amount of the project capital will be provided by Guangdong Provincial Fokai Expressway Co. Ltd and the rest amount of 2283 billion yuan will be solved by using bank loans. According to the "Official Reply to the preliminary design of reconstruction and extension project of Guangdong Sanbao to Shuikou Road by Ministry of Transport" (No.73-2017 Transport Road Document) issued by Guangdong Provincial Department of Transport the Ministry of Transport checked and ratified that the general estimate of the preliminary design of reconstruction and extension project of Guangdong Sanbao to Shuikou Road is RMB 3.426 billion As of December 312020 The accumulated expenses occurred of Sanboto Shuikou Highway extension project was 2.596 billion yuan. No Contract Counterparty Economic Content Contract Amount Fulfilled as of June 30 2020 1 China Railway Tunnel Group Co. Ltd. Civil Engineering 251026485.00 254055919.72 2 Poly Changda Engineering Co. Ltd. Civil Engineering 624878240.00 612468267.93 3 China Railway 18th Bureau Group Co. Ltd. Civil Engineering 219974609.00 209612477.24 4 CCCC First Navigation Engineering Bureau Co. Ltd Civil Engineering 355014108.00 302643777.44 2. Contingency (1) Significant contingency at balance sheet date As of December 312020The company does not disclose the pension plan undisclosed matter should exist. (2) The Company have no significant contingency to disclose also should be stated XV. Events after balance sheet date 1.Profit distribution In RMB Profit or dividend to be distributed 608424582.67 Profits or dividends declared upon examination and approval Subject to the approval of the shareholders' meeting XVI.Other significant events 1. Segment information The company's business for the Guangfo Expressway the Fokai Expressway and Jingzhu Expressway Guangzhu Section toll collection and maintenance work the technology industry and provide investment advice no other nature of the business no reportable segment. 2020 Annual Report 2.Government Subsidy (1) Government subsidies included in deferred revenue are subsequently measured by the total amount method Subsidy item Category Opening balance New subsidy amount in current period The carry-over in current period is included in profit and loss amount Other changes Closing balance Presentation items carried over into profit or loss in the current period Asset-related/ revenue-relate d Cancel the special subsidy for the expressway provincial toll station project Financial appropriation 55851800.00 11306230.36 44545569.64 Other income Assets related Discount interest fund Discount interest fund 2500000.00 2500000.00 Financial Expreses Income related (2) Government subsidies included in current profits and losses using the total amount method Subsidy item Category Amount included in profit or loss in the current period Presentation items included in profit or loss in the current period Asset-related/revenue-related Subsidy for post stabilization Subsidy for post stabilization 516603.84 Other income Income related 3.Other important transactions and events have an impact on investors decision-making (1)June 152007 early in the morning The 325 Jiujiang Bridge collapsed on # 23 pier for ―Nanguijii 035# collision owned by the controlling subsidiary of the company Guangdong Fokai Expressway Company leads the collapse and the traffic jam of 200 meters long of the Jiujiang Bridge. On June 10 2009 Jiujiang Bridge opened to traffic has been restored.On June 192007 ， The Ministry of Communications the State Production Safety Supervision and Administration Commission issued the JiaoAnWeiming File [2007] No. 8 "Notification on the Guangdong"6.15 "Jiujiang Bridge Collision Accident" initially determined the causes of the accident are: the incident ship suddenly met heavy fog on the way from Foshan Gaoming to Sunde the captain neglected looking out did not take proper measures and deviated from the main channel touched the 325 National Road Jiujiang Bridge the non-navigation bridge pier and caused the collapsion of part of the Jiujiang bridge. The accident was an unnatural On July 192007，Fokai Company applied preservation of property to Guangzhou Maritime Court.On August 222007，Fokai Company officially prosecuted to Guangzhou Maritime Court asking Foshan South Sea Shipping Company Limited and Yang Xiong to undertake the compensation 25587684 yuan for the loss caused by collapsing of Jiujiang Bridge. On August 28 2007 Guangzhou Maritime Court accepted the case. According to the (2007)-Canton Haifa No. 332 ruling book issued by Guangzhou Maritime Court the proceeding of the case was suspended. After the court accepted the case the incident investigation team of Guangdong Provincial Government had not made the final report of Jiujiang Bridge accident. The Court on November 5 2007 decided to suspend the proceeding. In September 2008 Jiujiang Bridge accident investigation report was officially reported and resumed the proceedings. On December 5 2008 Guangzhou Marine Court opened a court trial to procceeded the case. Currently Guangzhou Haizhu prosecutorial office was intend to prosecute the accident captain Shi Guide therefore on January 5 2009 Guangzhou Maritime Court ruled the suspension of the case. On September 17 2013 the Guangzhou Maritime Court issued a notice of civil and eliminate the cause of suspension of proceedings the court decided to resume the trial. On December 19 2013 the Guangzhou Maritime Court opened a court session has not yet made the first-instance judgment. On March 7 2014 the Court made the first instance verdict: the defendant Foshan Nanhai Yuhang ship Services Co. Ltd. and Yang Xiong compensated the plaintiff Fokai Expressway Co. Ltd. toll revenue losses of 19357500.96 yuan; the court dismissed the plaintiff other aspirations. The defendant appealed to the Higher People's Court of Guangdong Province the Guangdong Provincial Higher People's Court ruled on June 5 2014 the case discontinued proceedings. By the end of the report period the abatement of action causes are already removed and the provincial higher court restores the hearing and conducts the investigation on April 21 2017. On 27 February 2020 the company received a court decision of second instance which rejected the appeal and upheld the original sentence. Because the defendant failed to perform the effective judgment the company applied to Guangzhou Maritime Court for compulsory execution. On July 27 2020 the company received the enforcement ruling of Guangzhou Maritime Court ([2020] Y 72 Z No.247 - 3rd); A total execution payment of RMB 657219.33 was transferred to our company by the court and the execution procedure was terminated according to law. (2)The 26th (Provisional)Meeting of the sixth board of directors of Guangdong Provincial Expressway Development Co. Ltd. was held of May 10 2012. The meeting examined and adopted the proposal Concerning the Company’ s Accepting the insurance Bond Investment Plan of Pacific Asset Management Co. Ltd. The Company was approved to accept the insurance bond investment plan made by Pacific Asset Management Co. Ltd. The amount of proceeds to be raised is not more than 1.5 billion yuan . Floating interest rate plus guaranteed base interest rate applies as the interest rate. The Floaing interest rate shall not exceed the basic interest rate of RMB loan with a term of over five years on the day when the investment fund of the insureance company is transferred into the Company’s account and the corresponding days of the future years which shall be adjusted once each year. The guaranteed base interest rate is 5.6%. The concrete amount of raised proceeds shall be within maximum limit of investment fund filed with CIRC. The actual amount wholly transferred to the Company shall apply. The final interest rate is subject to investment Contract for Bond Investment Plan between Pacific and Guangdong Expressway Filed with CIRC. It was approved to authorize the management of the Company to implement the above-mentioned matters. The Company was approved to provide counter guarantee to Guangdong Communication Group Co.Ltd.with 75% equity of Guangdong Fokai Expressway Co. Ltd. Held by it . As of the end of this period the company has returned all the raised funds to Pacific Asset Management Co. Ltd. On May 22 2020 the company completed the cancellation registration of equity pledge of Guangzhou Guangzhu Transportation Investment Management Co. Ltd. （3）The 19th (Provisional)Meeting of the Eighth board of directors of Guangdong Provincial Expressway Development Co. Ltd. was held of August 7 2018. The meeting examined and approved the Proposal on Issuing Medium-Term Notes， Agree that the company intends to register in the China Interbank Market Dealers Association with a quota of not more than 3.4 billion yuan (inclusive) which is within 40% of the company's latest audited net assets. Apply for a one-time or installment in a timely manner with a term of no less than 5 years (including 5 years) and raise funds to repay the loan and replenish working capital; The matter has been passed by the resolution of the first interim shareholders' meeting in 2018.On January 4 2019 the dealers association issued a Notice of Acceptance of Registration (ZSXZ [2019] MTN 9). The amount of acceptance of the company's medium-term notes is 3.4 billion yuan and the amount of registration is valid for 2 years from the date of receipt of the notice of acceptance and it is jointly underwritten by Industrial and Commercial Bank of China Limited and China Construction Bank Limited. The company borrowed 680 million yuan and 750 million yuan on March 1 2019 and March 17 2020.The Company's plan to purchase 21% equity of Guangdong Guanghui Expressway Co. Ltd. (hereinafter referred to as "Guanghui") held by Guangdong Expressway Co. Ltd. (hereinafter referred to as "Guangdong Expressway") by payment in cash and related matters have been adopted by the resolution of the third extraordinary general meeting of shareholders in 2020. As of December 31 2020 the Company has paid a total of RMB 1271710284.00 to Guangdong Expressway accounting for 51% of the total equity transfer and 21% of Guanghui's equity has been changed to the Company's name. The amendments to Guanghui Articles of Association involved in this major asset restructuring have been filed with the market supervision and management department. According to the Profit Compensation Agreement signed by Guangdong Expressway and the Company it is agreed that Guangdong Expressway shall undertake the compensation obligation when the actual net profit of Guanghui is less than the predicted net profit within the compensation period. The compensation period is the year when the transaction is completed and the next two years thereafter namely 2020 2021 and 2022. After negotiation between the Company and Guangdong Expressway the predicted net profit of Guanghui after deducting non-recurring gains and losses in 2020 2021 and 2022 is RMB 652477500 RMB 1112587300 and RMB 1234200900 respectively. Within the compensation period if the accumulated realized net profit at the end of any fiscal year of Guanghui does not reach the accumulated predicted net profit Guangdong Expressway will compensate the company in cash and the specific compensation amount paid by Guangdong Expressway in that year will be calculated and determined according to the following formula: current compensation amount promised for performance = (accumulated predicted net profit as of the end of the current period - accumulated realized net profit as of the end of the current period) ÷ sum of predicted net profits of each year within the compensation period × transaction price of the underlying assets - accumulated compensated amount of Guangdong Expressway. When the compensation amount calculated in each year is less than the RMB 0 the value shall be taken as RMB 0 and the compensated amount shall not be reversed.The predicted net profit of Guanghui after deducting non-recurring gains and losses in 2020 is RMB 769.2326 million which is RMB 116.7551 million more than the promised amount. 2020 Annual Report XVII..Notes of main items in financial reports of parent company 1.Account receivable 1.Classification account receivables. In RMB Category Amount in year-end Balance Year-beginning Book Balance Bad debt provision Book value Book Balance Bad debt provision Book valueAmount Proportio n(%) Amou nt Amount Amount Proportion (%) Amount Amount Of which Accrual of bad debt provision by portfolio 27004827.41 100.00% 27004827.41 21864051.27 100.00% 21864051.27 Of which： Aging portfolio 27004827.41 100.00% 27004827.41 21864051.27 100.00% 21864051.27 Total 27004827.41 27004827.41 21864051.27 21864051.27 Accrual of bad debt provision by single item: None ②Accrual of bad debt provision by portfolio： In RMB Name Balance in year-end Book balance Bad debt provision Withdrawal proportion Within 1 year 27004827.41 100.00% Total 27004827.41 -- Provision for bad debts according to Quality guarantee portfolio Relevant information of the provision for bad debts will be disclosed with reference to the disclosure method of other receivables if the provision for bad debts of bills receivable is accrued according to the general model of expected credit loss: □Applicable √Not applicable Disclosure by aging In RMB Aging Closing balance Within 1 year（Including 1 year） 27004827.41 Total 27004827.41 (2) Accounts receivable withdraw reversed or collected during the reporting period The withdrawal amount of the bad debt provision：None （3）The current accounts receivable write-offs situation None （4）The ending balance of other receivables owed by the imputation of the top five parties In RMB Name Amount Proportion(%) Bad debt provision Guangdong Union Electronic Services Co. Ltd. 27004827.41 100.00% Total 27004827.41 100.00% （5）Account receivable which terminate the recognition owning to the transfer of the financial assets None (6)The amount of the assets and liabilities formed by the transfer and the continues involvement of accounts receivable None 2.Other receivable In RMB Items Year-end balance Year-beginning balance Dividend receivable 2705472.90 7205472.90 Other receivable 51442641.63 6230178.29 Total 54148114.53 13435651.19 （1）Dividend receivable 1)Dividend receivable In RMB Items Balance in year-end Balance Year-beginning Guangdong Radio and Television Networks investment No.1 Limited partnership enterprise 1205472.90 1205472.90 Guangdong Yueke Technology Petty Loan Co. Ltd. 6000000.00 Ganzhou Gankang Expressway Co. Ltd. 1500000.00 Total 2705472.90 7205472.90 2）Significant dividend receivable aged over 1 year I n RMB Items) Balance in year-end Aging Reasons for non-recovery Whether or not the impairment and the basis for its determination Guangdong Radio and Television Networks investment No.1 Limited partnership enterprise 1205472.90 Over 1 year Temporary freezing of company accounts No it's recoverable in the future Total 1205472.90 -- -- -- （2） Other accounts receivable 1) Other accounts receivable classified by the nature of accounts In RMB Nature Closing book balance Opening book balance Less receivable 45000000.00 Balance of settlement funds for securities transactions 30844110.43 30844110.43 Nature Closing book balance Opening book balance Cash deposit 2490271.36 1935101.00 Petty cash 2140410.04 1700634.57 Other 1905542.23 2594442.72 Total 82380334.06 37074288.72 2）The withdrawal amount of the bad debt provision： In RMB Bad Debt Reserves Stage 1 Stage 2 Stage 3 TotalExpected credit losses over the next 12 months Expected credit loss over life (no credit impairment) Expected credit losses for the entire duration (credit impairment occurred) Balance as at January 12020 30844110.43 30844110.43 Balance as at January 12020 in current —— —— —— —— Accrual 93582.00 93582.00 Balance as at December 312020 93582.00 30844110.43 30937692.43 Changes in significant book balances for loss preparation current period □ Applicable √ Not applicable Disclosure by aging In RMB Aging Closing balance Within 1 year（Including 1 year） 49224624.35 1-2 years 975380.70 2-3 years 443715.70 Over 3 years 31736613.31 3-4 years 463491.88 4-5 years 31273121.43 Over 5 years 82380334.06 Total 3） Accounts receivable withdraw reversed or collected during the reporting period The withdrawal amount of the bad debt provision： In RMB Category Balance Year-beginning Amount of change in the current period Balance in year-end Accrual Reversed or collected amount Write- off Other Accrual of single item 30844110.43 30844110.43 Accrual of portfolio-Aging portfolio 93582.00 93582.00 Total 30844110.43 93582.00 30937692.43 Where the current bad debts back or recover significant amounts:None 4)The actual write-off other accounts receivable: None 5) Top 5 of the closing balance of the other accounts receivable collated according to the arrears party In RMB Name Nature Closing balance Aging Proportion of the total year end balance of the accounts receivable(%) Closing balance of bad debt provision Ganzhou Gankang Expressway Co. Ltd. Less receivable 45000000.00 Within 1 year 54.62% Kunlun Securities Co.Ltd Investment Deposit 30844110.43 Over 5 years 37.44% 30844110.43 Guangdong Litong Real Estates Investment Co. Ltd.Vehicle parking deposit 1630467.36 Within 1 year 1.98% Foshan Hezhan Yinghui Property Management Co.Ltd. Disposal of Building Income from New Jitian Land 935820.00 1-2 year 1.14% 93582.00 Guangdong Provincial Freeway Co.Ltd. Commission management 463491.88 4-5 year 0.56% Total -- 78873889.67 -- 95.74% 30937692.43 (6) Accounts receivable involved with government subsidies None (7) Other account receivable which terminate the recognition owning to the transfer of the financial assets None (8) The amount of the assets and liabilities formed by the transfer and the continues involvement of other accounts receivable None 2020 Annual Report 3. Long-term equity investment In RMB Items End of term Beginning of term Book Balance Impairment provision Book value Book Balance Impairment provision Book value Investment in subsidiaries 3232062345.85 3232062345.85 1533665008.81 1533665008.81 Investment in joint ventures and associates 2297300190.68 2297300190.68 3255739898.36 3255739898.36 Total 5529362536.53 5529362536.53 4789404907.17 4789404907.17 （1）Investment to the subsidiary In RMB Name Opening balance Increase /decrease in reporting period Closing balance Closing balance of impairment provisionAdd investment Other Jingzhu Expressway Guangzhu Section Co. Ltd. 419105446.88 452066436.20 871171883.08 Guangzhou Guangzhu Traffic Investment Management Co. Ltd. 859345204.26 859345204.26 Guangfo Expressway Co. ltd. 154982475.25 154982475.25 Guangdong Expressway Technology Investment Co. Ltd. 95731882.42 95731882.42 Yuegao Capital Investment (Hengqin) Co. Ltd. 4500000.00 80000000.00 84500000.00 2020 Annual Report Guangdong Guanghui Expressway Co.Ltd. 2025676105.10 2025676105.10 Total 1533665008.81 2557742541.30 859345204.26 3232062345.85 （2）Investment to joint ventures and associated enterprises In RMB Name Opening balance Increase /decrease in reporting period Closing balance Closing balance of impairment provision Add investment Decreased investment Gain/loss of Investment Adjustment of other comprehensiv e income Other equity changes Declaration of cash dividends or profit Withdra wn impairm ent provisio n Oth er I. Joint ventures Guangdong Guanghui Expressway Co. Ltd. 1048473573.52 834101925.63 2025676105.10 234091510.52 26725050.00 117715954.57 Subtotal 1048473573.52 834101925.63 2025676105.10 234091510.52 26725050.00 117715954.57 II. Associated enterprises Guangdong Jiangzhong Expressway Co. Ltd. 179491516.98 12760987.96 192252504.94 Ganzhou Gankang 213672650.90 45000000.00 -21398030.18 1500000.00 145774620.72 2020 Annual Report Name Opening balance Increase /decrease in reporting period Closing balance Closing balance of impairment provision Add investment Decreased investment Gain/loss of Investment Adjustment of other comprehensiv e income Other equity changes Declaration of cash dividends or profit Withdra wn impairm ent provisio n Oth er Expressway Co. Ltd. Ganzhou Kangda Expressway Co. Ltd. 234733526.86 9080563.64 27000000.00 216814090.50 Shenzhen Huiyan Expressway Co. Ltd. 262682427.44 22726327.71 285408755.15 Guoyuan Securities Co.Ltd. 793926807.52 129910442.24 32205888.19 -5192159.89 11940297.90 938910680.16 Guangdong Yueke Technology Petty Loan Co. Ltd. 214637335.45 10065984.93 9000000.00 215703320.38 Zhaoqing Yuezhao Highway Co. 308122059.69 44064159.14 49750000.00 302436218.83 2020 Annual Report Name Opening balance Increase /decrease in reporting period Closing balance Closing balance of impairment provision Add investment Decreased investment Gain/loss of Investment Adjustment of other comprehensiv e income Other equity changes Declaration of cash dividends or profit Withdra wn impairm ent provisio n Oth er Ltd.Subtotal 2207266324.84 129910442.24 45000000.00 109505881.39 -5192159.89 99190297.90 2297300190.68 Total 3255739898.36 964012367.87 2070676105.10 343597391.91 -5192159.89 26725050.00 216906252.47 2297300190.68 4. Business income and Business cost In RMB Items Amount of current period Amount of previous period Revenue Cost Revenue Cost Main business 961484310.59 650430454.36 1276614430.61 779246352.00 Other 13956071.99 5240167.71 13675411.15 4575580.19 Total 975440382.58 655670622.07 1290289841.76 783821932.19 5.Investment income In RMB Items Amount of current period Amount of previous period Long-term equity investment income accounted by cost method 565261660.63 670160115.89 Long-term equity investment income accounted by equity method 343597391.91 469503736.12 Investment return on investments held to maturity during the holding period 50785213.04 38912399.15 Interest income from debt investment during holding period. 50332058.95 58235794.66 Total 1009976324.53 1236812045.82 XVIII. Supplementary Information 1.Current non-recurring gains/losses √ Applicable □Not applicable In RMB Items Amount Notes Gains/Losses on the disposal of non-current assets -8261533.18 Government grants recognized in the current period except for those acquired in the ordinary course of business or granted at certain quotas or amounts according to the country’s unified standards 8359291.82 Current net gains and losses occurred from period-begin to combination day by 546213524.55 The Company originally held 30% equity of Guanghui Expressway In subsidiaries resulting from business combination under common control 2020 the Company purchased 21% equity of Guanghui Expressway in cash nd the merger date under the same control was December 31 which was 70% of the net profit and loss realized by Guanghui Expressway in 2020 from the beginning of merger to the date of merger.Net amount of non-operating income and expense except the aforesaid items -1069827.30 Other non-recurring Gains/loss items 974321.89 Less :Influenced amount of income tax 2214.32 Influenced amount of minor shareholders’ equity (after tax) 383192431.88 In 2020 the Company purchased 21% equity of Guanghui Expressway in cash and the merger date under the same control was December 31 increasing the net profit and loss realized by Guanghui Expressway in 2020 which was attributable to minority shareholders by RMB 382722793.66. Total 163021131.58 -- For the Company’ s non-recurring gain/loss items as defined in the Explanatory Announcement No.1 on information disclosure for Companies Offering their Securities to the Public-Non-recurring Gains and Losses and its non-recurring gain/loss items as illustrated in the Explanatory Announcement No.1 on information Disclosure for Companies offering their securities to the public-non-recurring Gains and losses which have been defined as recurring gains and losses it is necessary to explain the reason. □ Applicable √Not applicable 2. Return on equity (ROE) and earnings per share (EPS) Profit as of reporting period Weighted average ROE (%) EPS（Yuan/share） EPS-basic EPS-diluted Net profit attributable to common shareholders of the Company 8.27% 0.42 0.42 Net profit attributable to common shareholders of the Company after deduction of non-recurring profit and loss EPS-diluted 0.34 0.34 XIII. Documents Available for Inspection 1. Accounting statements carried with personal signatures and seals of legal representative Chief Financial officer and Financial Principal. 2. Original of Auditors’ Report carried with the seal of Certified Public Accountants as well as personal signatures of certified Public accountants. 3. The texts of all the Company's documents publicly disclosed on the newspapers and periodicals designated by China Securities Regulatory Commission in the report period.