Changchai Company Limited
SEMI-Financial Report For the Year 2025
I Auditor’s Report
Whether the Semi-Annual Report is Audited
□Yes √No
The Company's semi-annual financial statements are unaudited.II Financial Statements
Currency unit for the financial statements and the notes thereto: RMB
1. Consolidated Balance Sheet
Prepared by Changchai Company Limited
30 June 2025
Unit: RMB
Item Closing balance Opening balance
Current assets:
Monetary assets 858358461.42 1063700492.59
Settlement reserve
Interbank loans granted
Held-for-trading financial assets 420234569.30 303667459.65
Derivative financial assets
Notes receivable 144816296.81 318814017.13
Accounts receivable 1252457584.20 444254240.02
Accounts receivable financing 39513968.25 223261002.76
Prepayments 13744199.73 12725958.70
Premiums receivable
Reinsurance receivables
Receivable reinsurance contract
reserve
Other receivables 9180838.09 9847441.82
Including: Interest receivable
Dividends receivable 5016960.00 7165080.00
Financial assets purchased under
resale agreements
Inventories 563967833.16 819201998.42
Including: Data resources
Contract assetsAssets held for sale
Current portion of non-current
assets
Other current assets 19676778.70 54605021.67
Total current assets 3321950529.66 3250077632.76
Non-current assets:
Loans and advances to
customers
Investments in debt obligations
Investments in other debt
obligations
Long-term receivables
Long-term equity investments
Investments in other equity
instruments 1019628058.72 941120058.72
Other non-current financial
assets 377869217.49 377869217.49
Investment property 36692487.77 37740844.55
Fixed assets 578958440.32 615414505.40
Construction in progress 5332994.97 3376866.69
Productive living assets
Oil and gas assets
Right-of-use assets
Intangible assets 139702226.26 142805785.86
Including: Data resources
Development costs
Including: Data resources
Goodwill
Long-term prepaid expense 2661330.28 2664557.06
Deferred income tax assets 8929666.59 6458337.99
Other non-current assets 4095737.65 4373097.30
Total non-current assets 2173870160.05 2131823271.06
Total assets 5495820689.71 5381900903.82
Current liabilities:
Short-term borrowings 94471787.41
Borrowings from the central
bank
Interbank loans obtained
Held-for-trading financial
liabilities
Derivative financial liabilities
Notes payable 631444212.92 491643629.88
Accounts payable 716427585.20 690733575.75
Advances from customers 30222448.06 30183376.84Contract liabilities 23469340.44 31640879.59
Financial assets sold under
repurchase agreements
Customer deposits and interbank
deposits
Payables for acting trading of
securities
Payables for underwriting of
securities
Employee benefits payable 11878823.63 48792254.98
Taxes payable 4176010.33 4214324.70
Other payables 130131731.84 117736961.52
Including: Interest payable
Dividends payable 3891433.83 3891433.83
Handling charges and
commissions payable
Reinsurance payables
Liabilities directly associated
with assets held for sale
Current portion of non-current
liabilities
Other current liabilities 98247746.66 175064677.93
Total current liabilities 1645997899.08 1684481468.60
Non-current liabilities:
Insurance contract reserve
Long-term borrowings
Bonds payable
Including: Preferred shares
Perpetual bonds
Lease liabilities
Long-term payables
Long-term employee benefits
payable
Provisions 72125778.35 73002860.52
Deferred income 27681302.29 29386167.02
Deferred income tax liabilities 169850274.38 154449852.33
Other non-current liabilities
Total non-current liabilities 269657355.02 256838879.87
Total liabilities 1915655254.10 1941320348.47
Shareholders’ equity:
Share capital 705692507.00 705692507.00
Other equity instruments
Including: Preferred shares
Perpetual bondsCapital reserves 640509675.84 640509675.84
Less: Treasury stock
Other comprehensive income 709799349.91 643067549.91
Specific reserve 24541362.09 21959066.35
Surplus reserves 367826665.27 367826665.27
General reserve
Retained earnings 1049993889.57 983627999.95
Total equity attributable to
Shareholders of the Company as 3498363449.68 3362683464.32
the parent
Non-controlling interests 81801985.93 77897091.03
Total shareholders’ equity 3580165435.61 3440580555.35
Total liabilities and shareholders’
equity 5495820689.71 5381900903.82
Legal representative: Xie Guozhong General Manager: Xie Guozhong
Head of the accounting department: Jiang He2. Balance Sheet of the Company as the Parent
Unit: RMB
Item Closing balance Opening balance
Current assets:
Monetary assets 732999515.55 932456827.90
Held-for-trading financial assets 301143750.00 200209027.78
Derivative financial assets
Notes receivable 134353496.75 291060042.38
Accounts receivable 1216497263.15 424946666.41
Accounts receivable financing 39513968.25 215854639.00
Prepayments 11373339.38 8720127.77
Other receivables 23253949.64 24288767.65
Including: Interest receivable
Dividends receivable 5016960.00 7165080.00
Inventories 331218921.07 551350588.20
Including: Data resources
Contract assets
Assets held for sale
Current portion of non-current
assets
Other current assets 888623.39 31935179.39
Total current assets 2791242827.18 2680821866.48
Non-current assets:
Investments in debt obligations
Investments in other debt
obligations
Long-term receivables
Long-term equity investments 868279449.94 868279449.94
Investments in other equity
instruments 1019628058.72 941120058.72
Other non-current financial
assets 377869217.49 377869217.49
Investment property 36692487.77 37740844.55
Fixed assets 170537891.18 188539011.23
Construction in progress 5016737.44 3132433.82
Productive living assets
Oil and gas assets
Right-of-use assets
Intangible assets 54450735.24 56046446.22
Including: Data resources
Development costs
Including: Data resourcesGoodwill
Long-term prepaid expense
Deferred income tax assets 8285605.02 5814276.42
Other non-current assets 3758279.00 3755279.00
Total non-current assets 2544518461.80 2482297017.39
Total assets 5335761288.98 5163118883.87
Current liabilities:
Short-term borrowings 49843838.91
Held-for-trading financial
liabilities
Derivative financial liabilities
Notes payable 645030519.41 652752618.33
Accounts payable 643108648.44 572396386.79
Advances from customers 30152248.06 30183376.84
Contract liabilities 20963758.88 23493204.39
Employee benefits payable 4801445.59 39221119.16
Taxes payable 1454153.78 2116355.96
Other payables 117888204.64 111060096.07
Including: Interest payable
Dividends payable 3243179.97 3243179.97
Liabilities directly associated
with assets held for sale
Current portion of non-current
liabilities
Other current liabilities 97402299.32 39139067.15
Total current liabilities 1560801278.12 1520206063.60
Non-current liabilities:
Long-term borrowings
Bonds payable
Including: Preferred shares
Perpetual bonds
Lease liabilities
Long-term payables
Long-term employee benefits
payable
Provisions 69144414.39 70293055.65
Deferred income 27681302.29 29386167.02
Deferred income tax liabilities 159282945.60 147506745.60
Other non-current liabilities
Total non-current liabilities 256108662.28 247185968.27
Total liabilities 1816909940.40 1767392031.87
Shareholders’ equity:
Share capital 705692507.00 705692507.00Other equity instruments
Including: Preferred shares
Perpetual bonds
Capital reserves 659418700.67 659418700.67
Less: Treasury stock
Other comprehensive income 709799349.91 643067549.91
Specific reserve 19232805.37 19117263.36
Surplus reserves 367826665.27 367826665.27
Retained earnings 1056881320.36 1000604165.79
Total shareholders’ equity 3518851348.58 3395726852.00
Total liabilities and shareholders’
equity 5335761288.98 5163118883.87
Legal representative: Xie Guozhong General Manager: Xie Guozhong
Head of the accounting department: Jiang He3. Consolidated Income Statement
Unit: RMB
Item 2025 Semi-Annual 2024 Semi-Annual
1. Revenue 1561186625.83 1495909152.63
Including: Operating revenue 1561186625.83 1495909152.63
Interest income
Insurance premium income
Handling charge and commission income
2. Costs and expenses 1485288910.96 1402397808.63
Including: Cost of sales 1361474105.33 1284673407.54
Interest expense
Handling charge and commission expense
Surrenders
Net insurance claims paid
Net amount provided as insurance contract
reserve
Expenditure on policy dividends
Reinsurance premium expense
Taxes and surcharges 9929153.46 8959091.13
Selling expense 29894284.08 25133785.12
Administrative expense 50718409.56 53480629.46
R&D expense 38891905.33 38765247.04
Finance costs -5618946.80 -8614351.66
Including: Interest expense 704087.32 1546928.49
Interest income 7108599.23 7969452.65
Add: Other income 6527952.88 1953702.37
Return on investment (“-” for loss) 7570956.48 14299040.62
Including: Share of profit or loss of joint
ventures and associates
Income from the derecognition of
financial assets at amortized cost (“-” for loss)
Exchange gain (“-” for loss)
Net gain on exposure hedges (“-” for loss)
Gain on changes in fair value (“-” for loss) 15685633.55 -34487453.74
Credit impairment loss (“-” for loss) -17051155.31 -17838282.66
Asset impairment loss (“-” for loss) -1007978.87 -359995.80
Asset disposal income (“-” for loss) 2797353.31 408245.54
3. Operating profit (“-” for loss) 90420476.91 57486600.33
Add: Non-operating income 142118.30 1070935.19
Less: Non-operating expense 28702.13 267734.59
4. Profit before tax (“-” for loss) 90533893.08 58289800.93Less: Income tax expense 13529676.07 4314671.32
5. Net profit (“-” for net loss) 77004217.01 53975129.61
5.1 By operating continuity
5.1.1 Net profit from continuing operations (“-”
77004217.0153975129.61
for net loss)
5.1.2 Net profit from discontinued operations (“-”
for net loss)
5.2 By shareholders’ equity
5.2.1 Net profit attributable to shareholders of the
73422814.6950097655.15
Company as the parent
5.2.1 Net profit attributable to non-controlling interests 3581402.32 3877474.46
6. Other comprehensive income net of tax 66731800.00 -44237400.00
Attributable to shareholders of the Company as the
66731800.00-44237400.00
parent
6.1 Items that will not be reclassified to profit or loss 66731800.00 -44237400.00
6.1.1 Changes caused by remeasurements on
defined benefit schemes
6.1.2 Other comprehensive income that will not be
reclassified to profit or loss under the equity method
6.1.3 Changes in the fair value of investments in
66731800.00-44237400.00
other equity instruments
6.1.4 Changes in the fair value arising from changes
in own credit risk
6.1.5 Other
6.2 Items that will be reclassified to profit or loss
6.2.1 Other comprehensive income that will be
reclassified to profit or loss under the equity method
6.2.2 Changes in the fair value of investments in
other debt obligations
6.2.3 Other comprehensive income arising from the
reclassification of financial assets
6.2.4 Credit impairment allowance for investments
in other debt obligations
6.2.5 Reserve for cash flow hedges
6.2.6 Differences arising from the translation of
foreign currency-denominated financial statements
6.2.7 Other
Attributable to non-controlling interests
7. Total comprehensive income 143736017.01 9737729.61
Attributable to shareholders of the Company as the
140154614.695860255.15
parent
Attributable to non-controlling interests 3581402.32 3877474.46
8. Earnings per share8.1 Basic earnings per share 0.1040 0.0710
8.2 Diluted earnings per share 0.1040 0.0710
Legal representative: Xie Guozhong General Manager: Xie Guozhong
Head of the accounting department: Jiang He4. Income Statement of the Company as the Parent
Unit: RMB
Item 2025 Semi-Annual 2024 Semi-Annual
1. Operating revenue 1451712384.50 1420095519.32
Less: Cost of sales 1302126081.67 1248849498.10
Taxes and surcharges 6144680.41 5596041.85
Selling expense 22573818.66 21137008.43
Administrative expense 37086364.52 38925179.53
R&D expense 35215371.58 34813766.30
Finance costs -5781927.35 -12954483.76
Including: Interest expense 491473.80 1415480.19
Interest income 7720759.20 11403739.83
Add: Other income 6508819.29 1756921.35
Return on investment (“-” for loss) 6826069.66 13453121.53
Including: Share of profit or loss of joint
ventures and associates
Income from the derecognition of
financial assets at amortized cost (“-” for loss)
Net gain on exposure hedges (“-” for loss)
Gain on changes in fair value (“-” for loss) 1143750.00
Credit impairment loss (“-” for loss) 268082.12 -18792776.77
Asset impairment loss (“-” for loss) -477875.67 -349743.48
Asset disposal income (“-” for loss) 2793207.25 421678.54
2. Operating profit (“-” for loss) 71410047.66 80217710.04
Add: Non-operating income 6.36 567599.20
Less: Non-operating expense 3720.00 3720.00
3. Profit before tax (“-” for loss) 71406334.02 80781589.24
Less: Income tax expense 8072254.38 11155612.41
4. Net profit (“-” for net loss) 63334079.64 69625976.83
4.1 Net profit from continuing operations (“-” for
net loss) 63334079.64 69625976.83
4.2 Net profit from discontinued operations (“-”
for net loss)
5. Other comprehensive income net of tax 66731800.00 -44237400.00
5.1 Items that will not be reclassified to profit or
loss 66731800.00 -44237400.00
5.1.1 Changes caused by remeasurements on
defined benefit schemes
5.1.2 Other comprehensive income that will not
be reclassified to profit or loss under the equity method
5.1.3 Changes in the fair value of investments
in other equity instruments 66731800.00 -44237400.00
5.1.4 Changes in the fair value arising from
changes in own credit risk5.1.5 Other
5.2 Items that will be reclassified to profit or loss
5.2.1 Other comprehensive income that will be
reclassified to profit or loss under the equity method
5.2.2 Changes in the fair value of investments
in other debt obligations
5.2.3 Other comprehensive income arising from
the reclassification of financial assets
5.2.4 Credit impairment allowance for
investments in other debt obligations
5.2.5 Reserve for cash flow hedges
5.2.6 Differences arising from the translation of
foreign currency-denominated financial statements
5.2.7 Other
6. Total comprehensive income 130065879.64 25388576.83
7. Earnings per share
7.1 Basic earnings per share
7.2 Diluted earnings per share
Legal representative: Xie Guozhong General Manager: Xie Guozhong
Head of the accounting department: Jiang He5. Consolidated Cash Flow Statement
Unit: RMB
Item 2025 Semi-Annual 2024 Semi-Annual
1. Cash flows from operating activities:
Proceeds from sale of commodities and rendering of services 882699452.94 881118416.96
Net increase in customer deposits and interbank deposits
Net increase in borrowings from the central bank
Net increase in loans from other financial institutions
Premiums received on original insurance contracts
Net proceeds from reinsurance
Net increase in deposits and investments of policy holders
Interest handling charges and commissions received
Net increase in interbank loans obtained
Net increase in proceeds from repurchase transactions
Net proceeds from acting trading of securities
Tax rebates 38633075.84 10606127.65
Cash generated from other operating activities 14290624.34 12788451.27
Subtotal of cash generated from operating activities 935623153.12 904512995.88
Payments for commodities and services 683791472.53 748951967.58
Net increase in loans and advances to customers
Net increase in deposits in the central bank and in interbank
loans granted
Payments for claims on original insurance contracts
Net increase in interbank loans granted
Interest handling charges and commissions paid
Policy dividends paid
Cash paid to and for employees 171760589.81 183166748.96
Taxes paid 44828633.07 38069979.90
Cash used in other operating activities 109548568.34 96138812.44
Subtotal of cash used in operating activities 1009929263.75 1066327508.88
Net cash generated from/used in operating activities -74306110.63 -161814513.00
2. Cash flows from investing activities:
Proceeds from disinvestment 643428229.00 385750000.00
Return on investment 3992501.83 14299040.62
Net proceeds from the disposal of fixed assets intangible
assets and other long-lived assets 3530738.93 76305099.30
Net proceeds from the disposal of subsidiaries and other
business units
Cash generated from other investing activities 12600.00
Subtotal of cash generated from investing activities 650964069.76 476354139.92Payments for the acquisition of fixed assets intangible assets
and other long-lived assets 3578214.68 11017090.96
Payments for investments 744553500.00 598044324.00
Net increase in pledged loans granted
Net payments for the acquisition of subsidiaries and other
business units
Cash used in other investing activities
Subtotal of cash used in investing activities 748131714.68 609061414.96
Net cash generated from/used in investing activities -97167644.92 -132707275.04
3. Cash flows from financing activities:
Capital contributions received
Including: Capital contributions by non-controlling interests to
subsidiaries
Borrowings raised
Cash generated from other financing activities
Subtotal of cash generated from financing activities
Repayment of borrowings
Interest and dividends paid 7056925.07 33167547.83
Including: Dividends paid by subsidiaries to non-controlling
interests
Cash used in other financing activities
Subtotal of cash used in financing activities 7056925.07 33167547.83
Net cash generated from/used in financing activities -7056925.07 -33167547.83
4. Effect of foreign exchange rates changes on cash and cash
equivalents
5. Net increase in cash and cash equivalents -178530680.62 -327689335.87
Add: Cash and cash equivalents beginning of the period 892681884.84 971629523.46
6. Cash and cash equivalents end of the period 714151204.22 643940187.59
Legal representative: Xie Guozhong General Manager: Xie Guozhong
Head of the accounting department: Jiang He6. Cash Flow Statement of the Company as the Parent
Unit: RMB
Item 2025 Semi-Annual 2024 Semi-Annual
1. Cash flows from operating activities:
Proceeds from sale of commodities and rendering of
services 784383704.35 792554114.17
Tax rebates 34098461.67 5571468.42
Cash generated from other operating activities 9834418.79 10526359.52
Subtotal of cash generated from operating activities 828316584.81 808651942.11
Payments for commodities and services 658698461.72 723988549.96
Cash paid to and for employees 136568203.72 153563701.50
Taxes paid 34259403.60 28596026.83
Cash used in other operating activities 72493533.98 77233383.77
Subtotal of cash used in operating activities 902019603.02 983381662.06
Net cash generated from/used in operating activities -73703018.21 -174729719.95
2. Cash flows from investing activities:
Proceeds from disinvestment 550000000.00 370000000.00
Return on investment 3198458.89 13453121.53
Net proceeds from the disposal of fixed assets intangible
assets and other long-lived assets 3138377.83 76421678.54
Net proceeds from the disposal of subsidiaries and other
business units
Cash generated from other investing activities 612159.97
Subtotal of cash generated from investing activities 556948996.69 459874800.07
Payments for the acquisition of fixed assets intangible
assets and other long-lived assets 1795759.49 2211874.73
Payments for investments 650000000.00 572000000.00
Net payments for the acquisition of subsidiaries and other
business units
Cash used in other investing activities
Subtotal of cash used in investing activities 651795759.49 574211874.73
Net cash generated from/used in investing activities -94846762.80 -114337074.66
3. Cash flows from financing activities:
Capital contributions received
Borrowings raised
Cash generated from other financing activities
Subtotal of cash generated from financing activities
Repayment of borrowings
Interest and dividends paid 7056925.07 33167547.83
Cash used in other financing activities
Subtotal of cash used in financing activities 7056925.07 33167547.83Net cash generated from/used in financing activities -7056925.07 -33167547.83
4. Effect of foreign exchange rates changes on cash and cash
equivalents
5. Net increase in cash and cash equivalents -175606706.08 -322234342.44
Add: Cash and cash equivalents beginning of the period 805614858.63 899689740.60
6. Cash and cash equivalents end of the period 630008152.55 577455398.16
Legal representative: Xie Guozhong General Manager: Xie Guozhong
Head of the accounting department: Jiang He7. Consolidated Statements of Changes in Shareholders’ Equity
Current Period
Unit: RMB
2025 Semi-Annual
Equity attributable to shareholders of the Company as the parent
Other equity Total
Item instruments Other Surplu Retain
Non-cont
Capital Less: Genera sharehold
Share compreh Specific s ed Ot rolling
capital Preferr Perpet
reserve Treasury l Subtotal ers’
Oth ensive reserve reserv earnin her interests
ed ual s stock reserve equity
er income es gs
shares bonds
1. Balance as
7056925 64050 643067 219590 3678 98362at the end of 07.00 9675.8 549.91 66.35 2666 7999.
33626877897093440580
4 5.27 95 3464.32 1.03 555.35the prior year
Add:
Adjustment for
change in
accounting
policy
Adjustment for
correction of
previous error
Other
adjustments2. Balance as
at the 7056925 64050 3678 983629675.8 643067 219590 2666 7999. 336268 7789709 3440580
beginning of 07.00 4 549.91 66.35 5.27 95 3464.32 1.03 555.35
the period
3. Increase/
decrease in the
0.00667318258229
6636513567939048941395848
period (“-” for 00.00 5.74
889.6
2985.36.9080.26
decrease)
3.1 Total
667318 73422comprehensive 00.00 814.6
14015435814021437360
9 614.69 .32 17.01income
3.2 Capital
increased and
reduced by
shareholders
3.2.1 Ordinary
shares
increased by
shareholders
3.2.2 Capital
increased by
holders of
other equity
instruments3.2.3
Share-based
payments
included in
shareholders’
equity
3.2.4 Other
3.3 Profit -7056 -70569 -705692
distribution 925.07 25.07 5.07
3.3.1
Appropriation
to surplus
reserves
3.3.2
Appropriation
to general
reserve
3.3.3
Appropriation -7056 -70569 -705692925.07 25.07 5.07
to shareholders
3.3.4 Other
3.4 Transfers
within
shareholders’
equity3.4.1 Increase
in capital (or
share capital)
from capital
reserves
3.4.2 Increase
in capital (or
share capital)
from surplus
reserves
3.4.3 Loss
offset by
surplus
reserves
3.4.4 Changes
in defined
benefit
schemes
transferred to
retained
earnings
3.4.5 Other
comprehensive
income
transferred to
retained
earnings3.4.6 Other
3.5 Specific 258229 258229 323492.5 2905788
reserve 5.74 5.74 8 .32
3.5.1 Increase 600503 600503 373360.1 6378392
in the period 1.87 1.87 7 .04
3.5.2 Used in 342273 342273
6.136.1349867.59
3472603
the period .72
3.6 Other
4. Balance as
7056925 64050at the end of 9675.8 709799 245413
36781049
07.00349.9162.09266699388
34983681801983580165
4 5.27 9.57 3449.68 5.93 435.61the period
Prior Period
Unit: RMB
2024 Semi-Annual
Equity attributable to shareholders of the Company as the parent
Other equity instruments Total
Item Less: Other Gen Retain Non-con
Share Perpe
Capital sharehold
Treasu compreh Specific Surplus eral ed Subtot trolling
capital Preferre tual
reserve Other ers’
Other ry ensive reserve reserves reser earnin al interests
d shares bond s equitystock income ve gs
s
1. Balance as 64050 1002 33989
at the end of 7056925 9675.8 667180 194320 363695 711212 347006807.00 321.82 89.52 592.34 43672 46911. 08.35 119.58
the prior year 4 4.71 23Add:
Adjustment for
change in
accounting
policy
Adjustment for
correction of
previous error
Other
adjustments
2. Balance as
at the 7056925 640509675.8 667180 194320 363695
100233989
4367246911.7112123470068
beginning of 07.00 4 321.82 89.52 592.34 4.71 23 08.35 119.58
the period
3. Increase/
decrease in the -44237 650615. 16930 -2665
period (“-” for 400.00 85 107.3 6676.8
387747-227792
2 3 4.46 02.37decrease)
3.1 Total
comprehensive -44237
50097
400.00655.1
586023877479737729
5 55.15 4.46 .61income
3.2 Capital
increased and
reduced by
shareholders3.2.1 Ordinary
shares
increased by
shareholders
3.2.2 Capital
increased by
holders of
other equity
instruments
3.2.3
Share-based
payments
included in
shareholders’
equity
3.2.4 Other
3.3 Profit -3316 -3316
7547.7547.8-331675
distribution 83 3 47.83
3.3.1
Appropriation
to surplus
reserves
3.3.2
Appropriation
to general
reserve3.3.3 -3316 -3316
Appropriation 7547. 7547.8 -331675
83 3 47.83to shareholders
3.3.4 Other
3.4 Transfers
within
shareholders’
equity
3.4.1 Increase
in capital (or
share capital)
from capital
reserves
3.4.2 Increase
in capital (or
share capital)
from surplus
reserves
3.4.3 Loss
offset by
surplus
reserves3.4.4 Changes
in defined
benefit
schemes
transferred to
retained
earnings
3.4.5 Other
comprehensive
income
transferred to
retained
earnings
3.4.6 Other
3.5 Specific 650615. 65061 650615.8
reserve 85 5.85 5
3.5.1 Increase 308316 30831 3083166
in the period 6.06 66.06 .06
3.5.2 Used in 243255 24325 2432550
the period 0.21 50.21 .21
3.6 Other
4. Balance as
7056925 64050 622942 200827 363695 1019 33722at the end of 07.00 9675.8 921.82 05.37 592.34 36683 90234.
7499863447288
4 2.03 40 82.81 917.21the period
Legal representative: Xie Guozhong General Manager: Xie Guozhong Head of the accounting department: Jiang He8. Statements of Changes in Shareholders’ Equity of the Company as the Parent
Current Period
Unit: RMB
2025 Semi-Annual
Other equity instruments Capit Other
Item Less: Ot Total
Share capital Preferr Perpet
al comprehen Specific Surplus Retained
Treasury he shareholders
ed ual Other reser sive reserve reserves earningsstock r ’ equity
shares bonds ves income
1. Balance as at the end 705692507. 65941870 64306754 19117263. 367826665. 100060416 33957268
of the prior period 00 0.67 9.91 36 27 5.79 52.00
Add: Adjustment for
change in accounting
policy
Adjustment for
correction of previous
error
Other adjustments
2. Balance as at the 705692507. 6594
001870
6430675419117263.367826665.10006041633957268
beginning of the period 0.67 9.91 36 27 5.79 52.00
3. Increase/ decrease in
the period (“-” for 66731800 115542.01 56277154.5 123124496.00 7 .58
decrease)
3.1 Total 66731800 63334079.6 130065879
comprehensive income .00 4 .643.2 Capital increased
and reduced by
shareholders
3.2.1 Ordinary shares
increased by
shareholders
3.2.2 Capital increased
by holders of other
equity instruments
3.2.3 Share-based
payments included in
shareholders’ equity
3.2.4 Other
3.3 Profit distribution -7056925.07 -7056925.07
3.3.1 Appropriation to
surplus reserves
3.3.2 Appropriation to
-7056925.07-7056925.shareholders 07
3.3.3 Other
3.4 Transfers within
shareholders’ equity
3.4.1 Increase in capital
(or share capital) from
capital reserves3.4.2 Increase in capital
(or share capital) from
surplus reserves
3.4.3 Loss offset by
surplus reserves
3.4.4 Changes in
defined benefit
schemes transferred to
retained earnings
3.4.5 Other
comprehensive income
transferred to retained
earnings
3.4.6 Other
3.5 Specific reserve 115542.01 115542.01
3.5.1 Increase in the 2435798.3 2435798.3
period 4 4
3.5.2 Used in the period 2320256.3 2320256.33 3
3.6 Other
4. Balance as at the end 705692507. 65941870 70979934 19232805. 367826665. 105688132 35188513
of the period 00 0.67 9.91 37 27 0.36 48.58
Prior Period
Unit: RMB2024 Semi-Annual
Other equity
instruments Other
Item Less: TotalShare Capital comprehen Specific Surplus Retained
capital Preferr Perpet
Treasury Other shareholders
Oth reserves sive reserve reserves earnings
ed ual stock ’ equity
er income
shares bonds
1. Balance as at the
end of the prior 705692507 659418 66718032 19010793. 363695592. 9965920 34115899.00 700.67 1.82 43 34 57.25 72.51
period
Add: Adjustment for
change in accounting
policy
Adjustment for
correction of previous
error
Other adjustments
2. Balance as at the
beginning of the 705692507 659418 66718032 19010793. 363695592. 9965920 34115899.00 700.67 1.82 43 34 57.25 72.51
period
3. Increase/ decrease
in the period (“-” for -4423740 3645842 -7595772.10.00 183198.84 9.00 6
decrease)
3.1 Total
comprehensive -4423740 6962597 25388576.0.00 6.83 83
income3.2 Capital increased
and reduced by
shareholders
3.2.1 Ordinary shares
increased by
shareholders
3.2.2 Capital
increased by holders
of other equity
instruments
3.2.3 Share-based
payments included in
shareholders’ equity
3.2.4 Other
3.3 Profit distribution -331675 -33167547.47.83 83
3.3.1 Appropriation to
surplus reserves
3.3.2 Appropriation to -331675 -33167547.
shareholders 47.83 83
3.3.3 Other
3.4 Transfers within
shareholders’ equity3.4.1 Increase in
capital (or share
capital) from capital
reserves
3.4.2 Increase in
capital (or share
capital) from surplus
reserves
3.4.3 Loss offset by
surplus reserves
3.4.4 Changes in
defined benefit
schemes transferred
to retained earnings
3.4.5 Other
comprehensive
income transferred to
retained earnings
3.4.6 Other
3.5 Specific reserve 183198.84 183198.84
3.5.1 Increase in the 2333560.4 2333560.4
period 5 5
3.5.2 Used in the 2150361.6 2150361.6
period 1 1
3.6 Other4. Balance as at the 705692507 659418 62294292 19193992. 363695592. 1033050 34039942
end of the period .00 700.67 1.82 27 34 486.25 00.35
Legal representative: Xie Guozhong General Manager: Xie Guozhong Head of the accounting department: Jiang HeIII. Company Profile
1. Registered location organization form and headquarters address of the Company
Changchai Company Limited (hereinafter referred to as “the Company”) was founded on 5 May 1994 which is a
company limited by shares promoted solely by Changzhou Diesel Engine Plant through the approval by the State
Commission for Restructuring the Economic Systems with document TGS [1993] No. 9 on 15 January 1993 by
way of public offering of shares. With the approval of the People’s Government of Jiangsu Province SZF [1993]
No. 67 as well as reexamined and approved by China Securities Regulatory Commission (“CSRC”) through
document ZJFSZ (1994) No. 9 the Company initially issued A shares to the public from 15 March 1994 to 30
March 1994. As approved by the Shenzhen Stock Exchange through document SZSFZ (1994) No. 15 such
tradable shares of the public got listing on 1 July 1994 at Shenzhen Stock Exchange with “Changchai” for short of
stock as well as “0570” as stock code (present stock code is “000570”).In 1996 upon recommendation by Document No. 13 [1996] of the General Office of Jiangsu Provincial People's
Government preliminary review by Document No. 24 [1996] of Shenzhen Securities Regulatory Office and
approval by Document No. 27 [1996] of the State Council Securities Commission the Company privately placed
100 million B-shares to qualified investors from August 27 to August 30 1996. The shares were listed on
September 13 1996 with the stock abbreviation "Changchai B" and stock code "2570" (current stock code:
"200570").Through years of bonus share distributions rights offerings capital reserve conversions and additional share
issuances as of June 30 2025 the Company's total issued share capital reached 705692507 shares with
registered capital of RMB 705692507.Registered Address: 123 Huaide Middle Road Changzhou Jiangsu Province
Headquarters Address: 123 Huaide Middle Road Changzhou Jiangsu Province
Unified Social Credit Code: 91320400134792410W
2. Principal Business Operations of the Company
The Company operates in the manufacturing industry with its business scope primarily covering: the
manufacturing and sales of diesel engines diesel engine components and castings gasoline engines gasoline
engine components grain harvesting machinery rotary tillers walking tractors molds and fixtures as well as the
assembly and sales of diesel engine units and gasoline engine units.The Company's main products or services include: the production and sales of small and medium-sized
single-cylinder and multi-cylinder diesel engines under the "Changchai" brand. The diesel engines produced and
sold by the Company are mainly used in tractors combine harvesters light commercial vehicles agricultural
equipment small construction machinery generator sets and marine engines.During the reporting period there were no changes to the Company's core business operations.
3. Authorization of Financial Statements
The financial report has been approved to be issued by the Board of Directors on August 20 2025.IV. Basis for Preparation of the Financial Report
1. Basis for Preparation
With the going-concern assumption as the basis and based on transactions and other events that actually occurred
the Group prepared financial statements in accordance with The Accounting Standards for BusinessEnterprises—Basic Standard issued by the Ministry of Finance with Decree No. 33 and revised with Decree No.
76 the various specific accounting standards the Application Guidance of Accounting Standards for Business
Enterprises the Interpretation of Accounting Standards for Business Enterprises and other regulations issued andrevised from 15 February 2006 onwards (hereinafter jointly referred to as “the Accounting Standards for BusinessEnterprises” “China Accounting Standards” or “CAS”) as well as the Rules for Preparation Convention of
Disclosure of Public Offering Companies No.15 – General Regulations for Financial Reporting (revised in 2023)
by China Securities Regulatory Commission.In accordance with relevant provisions of the Accounting Standards for Business Enterprises the Group adopted
the accrual basis in accounting. Except for some financial instruments where impairment occurred on an asset an
impairment reserve was withdrawn accordingly pursuant to relevant requirements.
2. Continuation
These financial statements are prepared on a going concern basis. The Company has the ability to continue as a
going concern for at least 12 months from the end of the reporting period.V. Important Accounting Policies and Estimations
Notification of specific accounting policies and accounting estimations:
The Company and its subsidiaries are principally engaged in the production and sales of small-to-medium sized
single-cylinder and multi-cylinder diesel engines under the 'Changchai' trademark. In accordance with their actual
production and operating characteristics and the relevant Accounting Standards for Business Enterprises the
Company and its subsidiaries have formulated specific accounting policies and accounting estimates for various
transactions and events as detailed in the following descriptions.
1. Statement of Compliance with the Accounting Standards for Business Enterprises
The financial statements prepared by the Company comply with the requirements of the Accounting Standards for
Business Enterprises (ASBE) and present fairly in all material respects the consolidated and parent company's
financial position as of June 30 2025 and the consolidated and parent company's operating results and cash flows
for the year then ended.
2. Fiscal Period
The Company's accounting periods are divided into fiscal years and interim periods. An interim accounting period
refers to a reporting period shorter than a full fiscal year. The Company adopts the Gregorian calendar year as its
fiscal year which starts from January 1st and ends on December 31st each year.
3. Operating Cycle
A normal operating cycle refers to a period from the Group purchasing assets for processing to realizing cash or
cash equivalents. An operating cycle for the Group is 12 months which is also the classification criterion for the
liquidity of its assets and liabilities.4. Currency Used in Bookkeeping
Renminbi is the functional currency of the Company.
5. Accounting Methods for Business Combinations under the Same Control and Business Combinations not
under the Same Control
Business Combination refers to transactions or events that integrate two or more separate enterprises into a single
reporting entity. Business combinations are categorized into Business Combinations under the Same Control and
Business Combinations not under the Same Control.
(1) Business combinations under the same control
The enterprises involved in combination are ultimately controlled by the same party or parties before and after the
combination. The control is not temporary and the combination is under the same control. For business
combination under the same control the party that obtains control over other participating enterprises on the
purchase date is the acquirer and other enterprises that participate in the combination are the acquirees.Combination date refers to the date on which the combining party actually obtains control to the combined party.The Company measures the assets and liabilities obtained from consolidation of enterprises according to the book
value of consolidated party’s assets and liabilities (including the goodwill arising from ultimate controller’s
acquisition of the consolidated party) in the ultimate controller’s consolidated financial statement on the
consolidation date; adjusts the capital premium in capital reserve by the difference between obtained net asset
book value and paid consolidated consideration book value (or total par value of shares issued) and adjusts
retained earnings if the capital premium in capital reserve is insufficient to offset.The direct expenses generated by the acquirer for the purpose of business combinations shall be recorded into the
profits and losses for the current period.
(2) Business combinations not under the same control
A business combination involving enterprises that are not ultimately controlled by the same party or parties both
before and after the combination is a business combination not under common control. In a business combination
not under common control the party that obtains control over the other combining enterprises on the acquisition
date is the acquirer and the other enterprises participating in the combination are the acquirees. The acquisition
date is the date on which the acquirer effectively obtains control of the acquiree.For a business combination not under common control the cost of combination includes the fair value at the
acquisition date of assets given liabilities incurred or assumed and equity instruments issued by the acquirer in
exchange for control of the acquiree. Professional fees such as audit legal valuation and consulting services as
well as other administrative costs related to the business combination are expensed as incurred. Transaction costs
incurred by the acquirer in issuing equity or debt instruments as consideration for the combination are included in
the initial recognition amount of the equity or debt instruments. Any contingent consideration is included in the
cost of combination at its fair value at the acquisition date. If new or additional evidence relating to circumstances
existing at the acquisition date arises within twelve months after the acquisition date and results in an adjustment
to the contingent consideration the amount of goodwill is adjusted accordingly. The acquirer measures the cost of
combination and the identifiable assets and liabilities acquired at their fair values at the acquisition date. The
excess of the cost of combination over the acquirer's interest in the fair value of the identifiable net assets of the
acquiree at the acquisition date is recognized as goodwill. If the cost of combination is less than the acquirer's
interest in the fair value of the identifiable net assets of the acquiree the acquirer first reassesses the measurement
of the identifiable assets liabilities and contingent liabilities acquired and the cost of combination. If the cost ofcombination remains less than the acquirer's interest in the fair value of the identifiable net assets of the acquiree
after the reassessment the difference is recognized in profit or loss for the period.If the acquirer obtains deductible temporary differences of the acquiree that do not meet the recognition criteria
for deferred tax assets at the acquisition date and are therefore not recognized and if within twelve months after
the acquisition date new or additional information becomes available indicating that the relevant circumstances
existed at the acquisition date and that the economic benefits associated with the deductible temporary differences
of the acquiree at the acquisition date are probable the related deferred tax assets are recognized with a
corresponding decrease in goodwill. If the goodwill is insufficient to absorb the decrease the excess is recognized
in profit or loss. In all other cases deferred tax assets arising from a business combination are recognized in profit
or loss.A business combination not under common control achieved in stages through multiple transactions is accounted
for by reference to the preceding paragraphs and Note V.14 "Long-term equity investments" if the transactions are
part of a single arrangement. If the transactions are not part of a single arrangement the accounting treatment is
differentiated between the separate financial statements and the consolidated financial statements:
In the separate financial statements the initial cost of the investment is the sum of the carrying amount of the
equity investment in the acquiree held prior to the acquisition date and the cost of the additional investment
incurred on the acquisition date. If the equity investment in the acquiree held prior to the acquisition date involves
other comprehensive income the related other comprehensive income is accounted for on the same basis as if the
acquiree had directly disposed of the related assets or liabilities when the investment is disposed of (i.e. except
for the relevant share of changes arising from the acquiree's remeasurement of defined benefit plan net liabilities
or assets accounted for under the equity method the remainder is reclassified to investment income in the current
period).In the consolidated financial statements the equity investment in the acquiree held prior to the acquisition date is
remeasured at its fair value on the acquisition date with any difference between the fair value and the carrying
amount recognized in investment income for the period. If the equity investment in the acquiree held prior to the
acquisition date involves other comprehensive income the related other comprehensive income is accounted for
on the same basis as if the acquiree had directly disposed of the related assets or liabilities (i.e. except for the
relevant share of changes arising from the acquiree's remeasurement of defined benefit plan net liabilities or assets
accounted for under the equity method the remainder is reclassified to investment income in the period in which
the acquisition date falls).
6. Criteria for Determining Control and Methods for Preparing Consolidated Financial Statements
(1) Criteria for Determining Control
The scope of consolidation is determined based on control. Control means that the Company has power over an
investee is exposed or has rights to variable returns from its involvement with the investee and has the ability to
use its power over the investee to affect the amount of the returns. This generally includes situations where: the
parent holds more than half of the voting rights of the investee; or the parent holds half or less of the voting rights
but has more than half of the voting rights through agreements with other investors; or has the power to govern the
financial and operating policies of the investee under the investee’s articles of association or agreements; or has
the power to appoint or remove the majority of the members of the board of directors of the investee; or has the
majority of voting rights at the board of directors of the investee.
(2) Methods for Preparing Consolidated Financial Statements
The Company includes subsidiaries in the consolidated financial statements from the date on which it obtainscontrol over the subsidiaries’ net assets and operating decisions and excludes them from the date on which such
control ceases. For subsidiaries disposed of the results of operations and cash flows prior to the disposal date are
properly included in the consolidated income statement and consolidated cash flow statement; for subsidiaries
disposed of during the period the opening balances of the consolidated balance sheet are not adjusted. For
subsidiaries acquired in business combinations not under common control their results of operations and cash
flows after the acquisition date are properly included in the consolidated income statement and consolidated cash
flow statement and the opening balances and comparative figures in the consolidated financial statements are not
adjusted. For subsidiaries acquired in business combinations under common control and entities acquired through
mergers their results of operations and cash flows from the beginning of the period in which the combination
occurs to the combination date are properly included in the consolidated income statement and consolidated cash
flow statement and the comparative figures in the consolidated financial statements are adjusted accordingly.When preparing the consolidated financial statements if the accounting policies or reporting periods adopted by a
subsidiary differ from those of the Company the subsidiary’s financial statements are adjusted to conform to the
Company’s accounting policies and reporting periods. For subsidiaries acquired in business combinations not
under common control their financial statements are adjusted based on the fair values of the identifiable net assets
at the acquisition date.All significant intercompany balances transactions and unrealized profits are eliminated in full in the consolidated
financial statements.The portion of equity and net profit or loss of subsidiaries attributable to non-controlling interests is presented
separately in the consolidated financial statements under equity and net profit respectively. The portion of net
profit or loss of subsidiaries attributable to non-controlling interests is presented as “non-controlling interests”
under net profit in the consolidated income statement. Losses attributable to non-controlling interests in a
subsidiary that exceed the non-controlling interests’ share of equity in the subsidiary at the beginning of the period
are allocated against non-controlling interests.When control over a former subsidiary is lost due to disposal of part of the equity investment or other reasons the
remaining equity interest is remeasured at its fair value at the date when control is lost. The difference between the
sum of the consideration received from the disposal and the fair value of the remaining equity interest and the
share of the carrying amount of the former subsidiary’s net assets attributable to the original equity interest from
the acquisition date is recognized in profit or loss for the period in which control is lost. Other comprehensive
income related to the equity investment in the former subsidiary is accounted for on the same basis as if the
investee had directly disposed of the related assets or liabilities when control is lost (i.e. except for the relevant
share of changes arising from the investee’s remeasurement of defined benefit plan net liabilities or assets the
remainder is reclassified to profit or loss for the current period). Subsequently the remaining equity interest is
accounted for in accordance with the relevant provisions of Accounting Standards for Business Enterprises No. 2
– Long-term Equity Investments or Accounting Standards for Business Enterprises No. 22 – Recognition and
Measurement of Financial Instruments. For details see Note 5.14 “Long-term Equity Investments” or Note V.10
“Financial Instruments”.When the Company loses control over a subsidiary through multiple transactions that involve disposing of equity
investments in the subsidiary step by step it is necessary to determine whether the transactions should be
accounted for as a single transaction. The terms conditions and economic effects of the transactions meet one or
more of the following circumstances which generally indicate that the transactions should be accounted for as a
single transaction: (1) the transactions are entered into simultaneously or in contemplation of one another; (2) the
transactions form a single transaction to achieve an overall commercial effect; (3) the occurrence of one
transaction depends on the occurrence of at least one other transaction; or (4) one transaction considered alone isnot economically justified but is economically justified when considered together with other transactions. If the
transactions are not part of a single transaction each transaction is accounted for separately as appropriate underthe principles applicable to “partial disposal of long-term equity investments in subsidiaries without loss ofcontrol” and “loss of control over former subsidiaries due to disposal of part of equity investments or otherreasons”. If the transactions are part of a single transaction they are accounted for as a single transaction
involving disposal of the subsidiary and loss of control; however the difference between the consideration
received from each disposal before the loss of control and the share of the subsidiary’s net assets attributable to
the disposed investment is recognized as other comprehensive income in the consolidated financial statements and
reclassified to profit or loss for the period in which control is lost.
7. Classification of Joint Arrangements and Accounting Treatment for Joint Operations
A joint arrangement is an arrangement of which two or more parties have joint control. The Company classifies
joint arrangements into joint operations and joint ventures based on the rights and obligations arising from the
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.The Company accounts for its investments in joint ventures using the equity method applying the accounting
policies described in Note V.14(2) * "Long-term Equity Investments Accounted for Using the Equity Method".As a joint operator in a joint operation the Company recognizes its individually held assets and assumed liabilities
as well as its share of jointly held assets and jointly assumed liabilities; recognizes revenue from the sale of its
share of the output from the joint operation; recognizes its share of revenue arising from the sale of output by the
joint operation; and recognizes expenses it incurs individually as well as its share of expenses incurred by the joint
operation.When the Company as a joint operator contributes or sells assets (which do not constitute a business the same
below) to a joint operation or purchases assets from a joint operation the Company only recognizes the portion of
gains or losses arising from the transaction that is attributable to the other joint operators until such assets are sold
to third parties. If these assets meet the criteria for impairment losses as stipulated in Accounting Standards for
Business Enterprises No. 8 - Impairment of Assets and other relevant standards the Company fully recognizes
such losses for assets contributed or sold to the joint operation by the Company and recognizes its share of such
losses for assets purchased from the joint operation by the Company.
8. Determination of cash and cash equivalents
The Company’s cash and cash equivalents include cash on hand deposits that can be used for payment at any time
investments that owned by the Company which are in short-term (usually due within three months from the
purchase date) highly liquid easy to convert to a known amount of cash low risk of value change.
9. Foreign currency operations
(1) Translation Methods for Foreign Currency Transactions
The Company translates foreign currency transactions into the functional currency amount at the spot exchange
rate on the transaction date upon initial recognition. However for foreign currency exchange transactions or
transactions involving currency exchange conducted by the Company the actual exchange rate adopted is used fortranslation into the functional currency amount.
(2) Translation Methods for Foreign Currency Monetary Items and Non-monetary Items
At the balance sheet date foreign currency monetary items are translated using the spot exchange rate on that date.The resulting exchange differences are recognized in profit or loss except for: * exchange differences arising
from foreign currency-specific borrowings related to the acquisition or construction of qualifying assets which
are accounted for in accordance with the principles for capitalizing borrowing costs; and * exchange differences
arising from changes in the carrying amount of available-for-sale foreign currency monetary items other than
amortized cost which are recognized in other comprehensive income.Non-monetary items denominated in foreign currency and measured at historical cost continue to be translated
using the spot exchange rate on the transaction date. Non-monetary items denominated in foreign currency and
measured at fair value are translated using the spot exchange rate on the date when the fair value is determined.The difference between the translated functional currency amount and the original functional currency amount is
treated as a fair value change (including exchange rate effects) and recognized in profit or loss or other
comprehensive income.
10. Financial Instruments
A financial asset or financial liability is recognized when the Company becomes a party to the financial
instrument contract.
(1) Classification confirmation and measurement of financial assets
Based on business model of managing financial assets and contractual cash flow characteristics of financial assets
the Company divides financial assets into: financial assets measured at amortized cost; financial assets measured
at fair value with changes included in other comprehensive income; financial assets measured at fair value through
profit and loss.Financial assets are measured at fair value at initial recognition. For the financial assets at fair value and through
current profit or loss the transaction expenses thereof should be recognized directly in profit or loss; for other
categories of financial assets the transaction expenses thereof should be recognized into initially recognized
amount. For the accounts receivable or bills receivable arising from product sales or labor service provision
excluding or not considering significant financing components the Company regards the amount of consideration
expected to charge as the initial recognition amount.* Financial assets measured at amortized costs
The corporate business model for managing financial assets measured at amortized cost aims at charging
contractual cash flow and the contractual cash flow characteristics of such financial assets are consistent with
basic borrowing and loan arrangements namely cash flow is generated on a specific date only for payment of
principal and interests based on outstanding principal amount. The Company utilizes effective interest rate method
for such financial assets and performs subsequent measurement as per amortized cost with gains or losses arising
from amortization or impairment included in current profits and losses.* Financial assets measured at fair value with changes included in other comprehensive income
The corporate business model for managing such financial assets aims at both contractual cash flow charging and
sales and the contractual cash flow characteristics of such financial assets are consistent with basic borrowing and
loan arrangements. The Company measures such financial assets at fair value with changes included in other
comprehensive income 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 designates some non-trading equity instrument investments as financial assets measured
at fair value with changes included in other comprehensive income. The Company records relevant dividend
income of such financial assets into current profits and losses and records fair value changes into other
comprehensive income. When such financial assets are derecognized the cumulative gains or losses previously
recorded in other comprehensive income will transfer from other comprehensive income into retained earnings
excluded in current profits and losses.* Financial Liabilities measured at fair value through profit and loss
The Company classifies the above financial assets measured at amortized cost and the financial assets other than
the financial assets measured at fair value with changes included in other comprehensive income as the financial
assets measured at fair value through profit and loss. In addition during initial recognition in order to eliminate or
significantly reduce accounting mismatches the Company designates some financial assets as financial assets
measured at fair value through profit and loss. For such financial assets the Company uses fair value for
subsequent measurement and fair value changes are included in current profits and losses.
(2) Classification recognition and measurement of financial liabilities
Financial liabilities are classified during initial recognition as the financial liabilities measured at fair value
through profit and loss and other financial liabilities. For financial liabilities at fair value through profit or loss
the transaction expenses thereof should be recognized directly in current profit or loss and for other financial
liabilities the transaction expenses thereof should be recognized into initially recognized amount.* Financial liabilities measured at fair value through profit and loss
Financial liabilities measured at fair value through profit and loss contain transactional financial liabilities
(including derivatives that belong to financial liabilities) and financial liabilities designated as measured at fair
value during initial recognition with changes included in current profits and losses.Transactional financial liabilities (including derivatives that belong to financial liabilities) are subsequently
measured at fair value and except for those related to hedge accounting the fair value changes are included in
current profits and losses.The financial liabilities designated as measured at fair value with changes included in current profits and losses
such liabilities are caused by the Company’s own credit risk changes with fair value changes included in other
comprehensive income and when the liabilities are derecognized they are included in other comprehensive
income caused by own credit risk changes with cumulative fair value changes transferred into retained earnings.The remaining fair value changes are included in current profits and losses. If treatment of own credit risk change
impact of such financial liabilities in the above manner will cause or expand accounting mismatch in profits and
losses the Company includes all gains or losses of such financial liabilities (including the amount of corporate
own credit risk change impact) in current profits and losses.* Other financial liabilities
Except the financial liabilities and financial guarantee contract arising from financial asset transfer at variance
with derecognition conditions or continuous involvement of transferred financial assets other financial liabilities
are classified as financial liabilities measured at amortized cost and subsequently measured at amortized cost
with gains or losses resulting from derecognition or amortization included in current profits and losses.
(3) Recognition basis and measurement method of financial assets transfer
Financial assets are derecognized in one of the following conditions: * the contractual right to receive cash flow
of such financial assets is terminated; * such financial assets have been transferred and almost all risks and
rewards on the financial asset Ownership are transferred to the transferee; * such financial assets have been
transferred and although the Company has neither transferred nor retained almost all risks and rewards on thefinancial asset Ownership it has given up control of such financial assets.If the enterprise neither transfers nor retains substantially all the risks and rewards of Ownership of a financial
asset and it has not abandoned the control of that financial asset the relevant financial asset is recognized at the
extent of continuing involvement in the transferred financial asset and the corresponding liability is recognized
accordingly. The degree of continuous involvement in the transferred financial asset refers to the risk level that the
enterprise faces due to the change of the value of the financial asset.Where a transfer of a financial asset in its entirely meets the criteria of de-recognition the difference between the
carrying amount of the financial asset transferred and the sum of the consideration received from the transfer and
any cumulative change in fair value that has been recognized in other comprehensive income is recognized in
current profit or loss.Where a transfer of financial asset partly meets the criteria of de-recognition the carrying amount of the financial
asset transferred should be amortized between the part that is derecognized and the part that is not derecognized
according to the fair value and the difference between the sum of the consideration received from the transfer and
any cumulative change in fair value that has been recognized in other comprehensive income and should be
amortized to the derecognized part and tthe amortized carrying amount of the above-mentioned financial asset
shall be recorded into current profit or loss.When the Company uses financial assets sold with recourse or sells financial assets held in an endorsement it
must determine whether all risks and rewards of Ownership of the financial assets have been almost transferred. If
all the risks and rewards of Ownership of the financial asset are almost transferred to the transferee and the
financial asset is derecognized; if all the risks and rewards on the Ownership of the financial asset are retained the
financial asset is not derecognized; all the risks and rewards of Ownership of financial assets are not almost
transferred or retained continue to determine whether the Company retains the control over the assets and
perform the accounting operation based on the principles described in the preceding paragraphs.
(4) De-recognition of financial liabilities
If current obligations of financial liabilities (or a part thereof) are removed the Company derecognizes such
financial liabilities (or a part thereof). If the Company (borrower) signs an agreement with the lender to replace
the original financial liabilities by bearing new financial liabilities and contract clauses of new financial liabilities
and original financial liabilities are substantially different the original financial liabilities are derecognized while
recognizing a new financial liability. If the Company makes substantial modification to the contractual clauses of
original financial liabilities (or a part thereof) the original financial liabilities are derecognized and a new
financial liability is recognized according to the clauses after modification.If financial liabilities (or a part thereof) are derecognized the Company records the difference between their book
value and consideration paid (including non-cash assets transferred out or liabilities assumed) into current profits
and losses.
(5) Offset of financial assets and financial liabilities
When the Company has legal right to offset financial assets and financial liabilities of the recognized amount and
such legal rights are currently enforceable meanwhile the Company plans to settle by net assets or concurrently
liquidate such financial assets and repay such financial liabilities financial assets and financial liabilities are
presented in the balance sheet by net amounts after mutual offset. In addition financial assets and financial
liabilities are separately presented in the balance sheet which are not offset by each other.
(6) Determining method of the fair value of financial assets and financial liabilities
Fair value refers to the price that a market participant can be received for the sale of an asset or the price he needs
to pay for transferring a liability in an orderly transaction occurring on the measurement date. Where the financialinstruments exist on active market the Company determines their fair value by using quotation on active market.Quoted market prices in an active market refer to the prices that are readily to be get regularly from the exchange
the broker the trade association pricing services institution etc. and they represent the actual market transaction
prices in the fair transactions. Where the financial instruments do not exist on active market the Company
determines their fair value by using valuation techniques. Valuation techniques include refers to the prices used in
recent market transactions by the parties that are familiar to the situation and are voluntary to participate in the
transaction refers to the current fair values of other essentially the same financial instruments discount cash flow
valuation option pricing models etc. At the time of valuation the Company leverages valuation techniques that
are applicable in the current circumstances and adequately supported by available data and other information
chooses the input value consistent with the characteristics of assets or liabilities considered by market participants
in transaction of relevant assets or liabilities and prefers to use the relevant observable input value. The value that
cannot be inputted is utilized when the relevant observable input value is unavailable or unfeasible to obtain.
11. Impairment of financial assets
The Company assesses impairment losses for the following financial assets: Financial assets measured at
amortized cost; Debt instruments measured at fair value through other comprehensive income (FVOCI); These
primarily include: Notes receivable; Accounts receivable; Contract assets; Other receivables; Debt investments;
Other debt investments; Long-term receivables; Additionally impairment provisions and credit impairment losses
for certain financial guarantee contracts are recognized in accordance with the accounting policies outlined below.
(1) Method for Recognizing Impairment Provisions
The Company measures expected credit losses (ECL) for the above items using either the general approach or the
simplified approach depending on their applicability and recognizes corresponding credit impairment losses.Credit loss refers to the present value of all contractual cash flows the Company is entitled to receive under the
contract discounted at the original effective interest rate minus the present value of all expected cash flows to be
collected. For purchased or originated credit-impaired (POCI) financial assets the discount rate applied is the
credit-adjusted effective interest rate.General Approach for ECL Measurement
At each reporting date the Company assesses whether the credit risk of a financial asset has increased
significantly since initial recognition:
If credit risk has increased significantly the Company measures the loss allowance at an amount equal to lifetime
ECL.If credit risk has not increased significantly the loss allowance is measured at 12-month ECL.The assessment incorporates all reasonable and supportable information including forward-looking data.For financial instruments with low credit risk at the reporting date the Company assumes no significant increase
in credit risk since initial recognition and applies the 12-month ECL approach.
(2) Criteria for Determining Significant Increase in Credit Risk
A significant increase in credit risk is presumed if the probability of default (PD) over the remaining lifetime at
the reporting date is substantially higher than the PD estimated at initial recognition. Unless exceptional
circumstances exist the Company uses changes in the 12-month PD as a reasonable proxy for lifetime PD
changes to determine whether credit risk has increased significantly.Factors considered in assessing significant increases in credit risk:
Actual or expected material deterioration in the debtor’s operating performance;Material adverse changes in the debtor’s regulatory economic or technological environment;
Significant decline in collateral value or quality of third-party guarantees/credit enhancements which may reduce
the debtor’s economic incentive to repay or affect PD;
Material changes in the debtor’s expected behavior or repayment patterns;
Changes in the Company’s credit management practices for the financial instrument.Low credit risk presumption:
At the reporting date if a financial instrument is determined to have low credit risk the Company assumes no
significant increase in credit risk since initial recognition. A financial instrument is considered low risk if:
The debtor has a strong capacity to meet short-term contractual cash flow obligations;
Adverse economic or operational conditions over a longer period would not necessarily impair the debtor’s ability
to fulfill its obligations.
(3) Portfolio-Based Assessment of Expected Credit Risk
The Company evaluates credit risk individually for financial assets with distinctly different risk profiles such as:
Receivables under dispute litigation or arbitration;
Receivables with clear evidence indicating the debtor’s inability to repay.For all other financial assets the Company groups them based on shared credit risk characteristics including:
Financial instrument type
Credit risk rating
Aging profile (e.g. current overdue segments)
(4) Accounting Treatment for Financial Asset Impairment
At period-end the Company calculates ECL for each category of financial assets:
If the ECL exceeds the current carrying amount of the impairment allowance the difference is recognized as an
impairment loss;
If the ECL is lower than the current allowance the difference is recognized as an impairment gain.
(5) Method for recognizing credit losses of various financial assets
* Bills receivable
The Company measures loss provision for bills receivable based on the amount equivalent to expected credit
losses throughout the existence period. Based on credit risk characteristics of bills receivable they are divided into
different portfolios:
Items Basis of determining the portfolio
Bank acceptance bill Acceptors are banks with low credit risks
Bank Acceptance Draft (Issued by Finance Companies) Issued by Finance Companies
Commercial acceptance bill All of commercial acceptance bill
* Accounts receivable and contract assets
With regard to accounts receivable and contract assets excluding major financing components the Company
measures loss reserve at the amount equivalent to the expected credit loss throughout the duration.With regard to accounts receivable and contract assets including major financing components the Company
chooses to always measure loss reserve at the amount equivalent to the expected credit loss throughout the
duration.In addition to accounts receivable with individual assessment of credit risks they are divided into different
portfolios based on their credit risk characteristics:
Items Basis of determining the portfolio
Credit risk characteristics portfolio Portfolio based on aging of receivables as credit risk characteristic
Related party within consolidation scope Related party within consolidation scope
a. The aging of the Company's receivables is calculated from the date of occurrence.For the portfolio the aging-based grouping method is adopted to measure expected credit losses (ECL):
Provision ratios of notes Provision ratios of Provision ratios of Provision ratios of other
Aging
Receivable (%) accounts receivable (%) contract assets (%) receivables (%)
Within 1 2.00 2.00 2.00 2.00
year
1-2 years 5.00 5.00 5.00 5.00
2-3 years 15.00 15.00 15.00 15.00
3-4 years 30.00 30.00 30.00 30.00
4-5 years 60.00 60.00 60.00 60.00
Over 5 100.00 100.00 100.00 100.00
years
b. Criteria for Recognizing Individually Assessed Bad Debt Provisions:
A financial asset is considered credit-impaired when one or more events that have a detrimental impact on the
asset's expected future cash flows occur. Observable evidence of credit impairment includes but is not limited to
the following:
The issuer or debtor is experiencing significant financial difficulties.The debtor has breached contractual terms such as defaulting or delaying payments of interest or principal.The creditor has granted concessions to the debtor (e.g. payment extensions reduced interest rates or principal
forgiveness) that would not otherwise be considered due to the debtor's financial distress.The debtor is likely to enter bankruptcy or undergo financial restructuring.The active market for the financial asset has disappeared due to the financial difficulties of the issuer or debtor.The financial asset was acquired or originated at a significant discount reflecting incurred credit losses.Credit impairment may result from a combination of factors and does not necessarily stem from a single
identifiable event.* Receivables Financing
Financial assets classified as notes receivable and accounts receivable measured at fair value through other
comprehensive income (FVTOCI) shall be presented as follows:
"Receivables financing" for portions with original maturities of one year or less from the date of acquisition;
"Other debt investments" for portions with original maturities exceeding one year from the date of acquisition.Except for individually assessed accounts receivable these financial assets are grouped into different portfolios
based on their credit risk characteristics.Item Basis of determining the portfolio
Notes receivable Bank acceptance drafts issued by banks with high credit ratings
Accounts receivable This portfolio uses the aging of receivables as the credit risk characteristic.* Other receivables
The Company measures impairment losses based on whether the credit risks of other receivables have increased
significantly since initial recognition by using the amount equivalent to expected credit losses within the next 12
months or throughout the existence period. In addition to other receivables with individual assessment of credit
risks they are divided into different portfolios based on their credit risk characteristics:
Item Basis of determining the portfolio
Aging portfolio Other receivables excluding related parties
Related party within consolidation
Other receivables from related parties within the scope of consolidation
scope
12. Inventories
(1) Classification of Inventories
Inventories mainly include raw materials materials in outside processing work in progress finished goods and
low-value consumables.
(2) Measurement Method for Issuance
All categories of inventories are purchased and received at planned costs and issued using the weighted average
method. Finished goods costs are transferred at actual costs incurred during the period while cost of sales is
recognized using the weighted average method.
(3) Inventory Counting System
The perpetual inventory system is adopted.
(4) Amortization Method for Low-Value Consumables and Packaging Materials
Low-value consumables are fully amortized upon issuance (one-time amortization method). Packaging materials
are fully amortized upon issuance (one-time amortization method).
(5) Recognition Criteria and Provision Method for Inventory Write-Down
The net realizable value (NRV) of inventory refers to the estimated selling price in the ordinary course of business
minus the estimated costs to complete selling expenses and related taxes. The determination of NRV is based on
reliable evidence while also considering the purpose of holding the inventory and the impact of events after the
reporting period.At the balance sheet date inventories are measured at the lower of cost or NRV. Based on a comprehensive
year-end physical count provisions are made for inventories that are damaged obsolete priced below cost or
otherwise unrecoverable. Write-downs are recognized for individual inventory items where cost exceeds NRV
with the loss recorded in profit or loss.Methods for Determining NRV: Finished goods merchandise and materials held for sale: NRV = Estimated selling price ? Estimated
selling expenses ? Related taxes.Materials requiring further processing: NRV = Estimated selling price of finished products ? Estimated
costs to complete ? Estimated selling expenses ? Related taxes.Partial contract pricing: If part of an inventory item has a contract price while the remainder does not
NRV is determined separately.Aggregate assessment: For inventories with similar use or produced/sold in the same region
write-downs are assessed collectively if individual valuation is impractical.High-volume low-cost items: Write-downs are assessed by inventory category.If the factors that previously caused inventory write-downs no longer exist resulting in NRV exceeding the
carrying amount the reversal (limited to the original provision amount) is recognized in profit or loss.
13. Assets held for sale
(1) Non-current Assets and Disposal Groups Held-for-sale
The Company classifies a non-current asset or disposal group as held-for-sale if its carrying amount will be
recovered principally through a sale transaction (including non-monetary asset exchanges with commercial
substance the same applies below) rather than through continuing use. The specific criteria are that all of the
following conditions are met: (i) the non-current asset or disposal group is available for immediate sale in its
present condition subject only to terms that are usual and customary for sales of such assets or disposal groups; (ii)
the Company has approved the sale plan and obtained a firm purchase commitment; and (iii) the sale is expected
to be completed within one year. A disposal group refers to a group of assets to be disposed of by sale or
otherwise together as a group in a single transaction and liabilities directly associated with those assets that will
be transferred in the transaction. If the goodwill acquired in a business combination was allocated to a
cash-generating unit or group of cash-generating units to which the disposal group belongs under Accounting
Standards for Business Enterprises No. 8—Impairment of Assets the disposal group shall include the goodwill
allocated to it.When initially measuring or remeasuring non-current assets or disposal groups classified as held-for-sale at the
balance sheet date if their carrying amount exceeds their fair value less costs to sell the carrying amount is
written down to fair value less costs to sell. The amount of the write-down is recognized as an impairment loss in
profit or loss for the current period and a provision for impairment of held-for-sale assets is made. For disposal
groups the recognized impairment loss is first allocated to reduce the carrying amount of any goodwill in the
disposal group and then to reduce the carrying amounts of the other non-current assets in the disposal group that
are subject to the measurement requirements of Accounting Standards for Business Enterprises No.
42—Non-current Assets Held-for-sale and Discontinued Operations (hereinafter referred to as the "held-for-sale
standards") on a pro-rata basis. If the fair value less costs to sell of a held-for-sale disposal group increases in
subsequent balance sheet dates the previously recognized impairment loss shall be reversed. The reversal is
limited to the cumulative impairment loss recognized for the non-current assets in the disposal group that are
subject to the measurement requirements of the held-for-sale standards after classification as held-for-sale and the
reversal amount is recognized in profit or loss for the current period. The carrying amounts of the non-current
assets in the disposal group that are subject to the measurement requirements of the held-for-sale standards
(excluding goodwill) are increased on a pro-rata basis according to their relative carrying amounts. The carrying
amount of goodwill that has been reduced as well as impairment losses recognized for non-current assets subject
to the measurement requirements of the held-for-sale standards before classification as held-for-sale shall not bereversed.Non-current assets in a disposal group classified as held-for-sale are not depreciated or amortized while interest
and other expenses on liabilities in a held-for-sale disposal group continue to be recognized.When a non-current asset or disposal group no longer meets the criteria for classification as held-for-sale the
Company ceases to classify it as held-for-sale or removes the non-current asset from the held-for-sale disposal
group and measures it at the lower of: (i) its carrying amount before classification as held-for-sale adjusted for
any depreciation amortization or impairment that would have been recognized had it not been classified as
held-for-sale; and (ii) its recoverable amount.
(2) Criteria for Identifying and Presentation Methods for Discontinued Operations
A discontinued operation is a component of the Company that either has been disposed of or is classified as
held-for-sale and meets any of the following criteria: (i) the component represents a separate major line of
business or geographical area of operations; (ii) the component is part of a single coordinated plan to dispose of a
separate major line of business or geographical area of operations; or (iii) the component is a subsidiary acquired
exclusively with a view to resale.The Company presents the relevant profit or loss from discontinued operations in the income statement and
discloses the effects of discontinued operations in the notes.
14. Long-term Equity Investments
The long-term equity investments referred to in this section are those in which the Company has control joint
control or significant influence over the investee. Long-term equity investments in which the Company does not
have control joint control or significant influence are accounted for as financial assets measured at fair value
through profit or loss. For non-trading investments the Company may elect at initial recognition to classify them
as financial assets measured at fair value through other comprehensive income as detailed in Note V.10 "Financial
Instruments."
Joint control refers to the Company's shared control over an arrangement in accordance with relevant agreements
where decisions regarding the relevant activities of the arrangement require unanimous consent from all parties
sharing control. Significant influence refers to the Company's power to participate in the financial and operating
policy decisions of the investee but not to control or jointly control those policies with other parties.
(1) Determination of Investment Cost
For long-term equity investments acquired through business combinations under common control the initial
investment cost is measured at the share of the carrying value of the acquiree's equity in the consolidated financial
statements of the ultimate controlling party on the combination date. The difference between the initial investment
cost and the sum of the cash paid the carrying value of non-cash assets transferred and liabilities assumed is
adjusted against capital reserve. If capital reserve is insufficient the remaining difference is adjusted against
retained earnings. If equity instruments are issued as consideration the initial investment cost is measured at the
share of the carrying value of the acquiree's equity in the consolidated financial statements of the ultimate
controlling party on the combination date with the total par value of the shares issued recognized as share capital.The difference between the initial investment cost and the total par value of the shares issued is adjusted against
capital reserve. If capital reserve is insufficient the remaining difference is adjusted against retained earnings. For
step-by-step acquisitions of equity in an acquiree under common control that ultimately result in a business
combination under common control the transactions are accounted for separately based on whether they
constitute a "package transaction." If they constitute a "package transaction" the transactions are treated as a
single transaction to obtain control. If not the initial investment cost on the combination date is measured at theshare of the carrying value of the acquiree's equity in the consolidated financial statements of the ultimate
controlling party. The difference between the initial investment cost and the sum of the carrying value of the
long-term equity investment before the combination and the carrying value of additional consideration paid on the
combination date is adjusted against capital reserve. If capital reserve is insufficient the remaining difference is
adjusted against retained earnings. Other comprehensive income recognized for equity investments held before the
combination date under the equity method or as financial assets measured at fair value through other
comprehensive income is not accounted for at this stage.For long-term equity investments acquired through business combinations not under common control the initial
investment cost is measured at the combination cost on the acquisition date. The combination cost includes the
sum of the fair value of assets paid liabilities incurred or assumed and equity instruments issued by the acquirer.For step-by-step acquisitions of equity in an acquiree that ultimately result in a business combination not under
common control the transactions are accounted for separately based on whether they constitute a "package
transaction." If they constitute a "package transaction" the transactions are treated as a single transaction to obtain
control. If not the initial investment cost of the long-term equity investment accounted for under the cost method
is the sum of the carrying value of the previously held equity investment and the additional investment cost. Other
comprehensive income related to the previously held equity investment accounted for under the equity method is
not accounted for at this stage.Intermediary fees such as audit legal and valuation consulting services as well as other related administrative
expenses incurred by the combining or acquiring party for the business combination are recognized in profit or
loss when incurred.For other equity investments not formed through business combinations the initial measurement is based on cost
which is determined according to the actual cash purchase price paid by the Company the fair value of equity
instruments issued by the Company the value agreed in the investment contract or agreement the fair value or
original carrying value of assets exchanged in non-monetary asset exchanges or the fair value of the long-term
equity investment itself. Directly attributable costs taxes and other necessary expenses are also included in the
investment cost. For additional investments that enable the Company to exert significant influence or joint control
over the investee (but not control) the cost of the long-term equity investment is the sum of the fair value of the
previously held equity investment determined in accordance with Accounting Standards for Business Enterprises
No. 22—Recognition and Measurement of Financial Instruments and the additional investment cost.
(2) Subsequent Measurement and Profit/Loss Recognition Methods
Long-term equity investments in which the Company has joint control (excluding joint operations) or significant
influence are accounted for using the equity method. Additionally the Company's financial statements use the cost
method to account for long-term equity investments that enable the Company to control the investee.* Long-term Equity Investments Accounted for Using the Cost Method
Under the cost method long-term equity investments are measured at initial investment cost with adjustments
made for additional investments or disposals. Investment income for the period is recognized based on the
Company's share of cash dividends or profits declared by the investee excluding any dividends or profits declared
but not yet distributed at the time of investment.* Long-term Equity Investments Accounted for Using the Equity Method
Under the equity method if the initial investment cost exceeds the Company's share of the investee's identifiable
net assets at fair value at the investment date the initial investment cost is not adjusted. If the initial investment
cost is less than the Company's share of the investee's identifiable net assets at fair value at the investment date
the difference is recognized in profit or loss and the cost of the long-term equity investment is adjustedaccordingly.Under the equity method the Company recognizes investment income and other comprehensive income based on
its share of the investee's net profit or loss and other comprehensive income adjusting the carrying value of the
long-term equity investment accordingly. The carrying value is reduced by the Company's share of profits or cash
dividends declared by the investee. For other changes in the investee's equity not included in net profit or loss
other comprehensive income or profit distribution the carrying value of the long-term equity investment is
adjusted and recognized in capital reserve. When recognizing the share of the investee's net profit or loss the
investee's net profit is adjusted based on the fair value of identifiable assets at the investment date. If the investee's
accounting policies or reporting periods differ from the Company's the investee's financial statements are adjusted
to align with the Company's policies and periods before recognizing investment income and other comprehensive
income.For transactions between the Company and its associates or joint ventures where the assets contributed or sold do
not constitute a business unrealized internal transaction profits or losses attributable to the Company are
eliminated based on the Company's share and investment income is recognized after this adjustment. However
unrealized internal transaction losses attributable to impairment losses on the transferred assets are not eliminated.If the Company contributes assets constituting a business to a joint venture or associate and obtains long-term
equity investment without control the fair value of the contributed business is used as the initial investment cost
of the new long-term equity investment. The difference between the initial investment cost and the carrying value
of the contributed business is fully recognized in profit or loss. Similarly if the Company sells assets constituting
a business to a joint venture or associate the difference between the consideration received and the carrying value
of the business is fully recognized in profit or loss. If the Company purchases assets constituting a business from
an associate or joint venture the transaction is accounted for under Accounting Standards for Business Enterprises
No. 20—Business Combinations with gains or losses fully recognized.When recognizing the share of the investee's net losses the carrying value of the long-term equity investment and
other long-term interests that substantially constitute a net investment in the investee are reduced to zero. If the
Company has an obligation to assume additional losses a provision is recognized for the estimated obligation and
included in investment losses for the period. If the investee subsequently reports net profits the Company resumes
recognizing its share of profits after offsetting unconfirmed loss shares.* Acquisition of Minority Interests
When preparing consolidated financial statements the difference between the additional long-term equity
investment from acquiring minority interests and the share of the subsidiary's net assets calculated based on the
additional Ownership percentage continuously measured from the acquisition date (or combination date) is
adjusted against capital reserve. If capital reserve is insufficient the remaining difference is adjusted against
retained earnings.* Disposal of Long-term Equity Investments
In consolidated financial statements if the parent partially disposes of its long-term equity investment in a
subsidiary without losing control the difference between the disposal proceeds and the share of the subsidiary's
net assets corresponding to the disposed long-term equity investment is recognized in equity. If the partial disposal
results in loss of control over the subsidiary the relevant accounting policy described in Note 5.6(2) "Preparation
Methods for Consolidated Financial Statements" applies.For other disposals of long-term equity investments the difference between the carrying value of the disposed
equity and the actual proceeds is recognized in profit or loss.For long-term equity investments accounted for under the equity method if the remaining equity after disposalcontinues to be accounted for under the equity method the portion of other comprehensive income previously
recognized in equity is accounted for on the same basis as if the investee had directly disposed of the related assets
or liabilities. Changes in equity recognized due to other changes in the investee's equity (excluding net profit or
loss other comprehensive income and profit distribution) are proportionally reclassified to profit or loss.For long-term equity investments accounted for under the cost method if the remaining equity after disposal
continues to be accounted for under the cost method other comprehensive income recognized before obtaining
control under the equity method or financial instrument standards is accounted for on the same basis as if the
investee had directly disposed of the related assets or liabilities and proportionally reclassified to profit or loss.Changes in equity recognized under the equity method due to other changes in the investee's equity (excluding net
profit or loss other comprehensive income and profit distribution) are proportionally reclassified to profit or loss.If the Company loses control of an investee due to partial disposal of equity investments in its separate financial
statements the remaining equity that enables the Company to exert joint control or significant influence over the
investee is reclassified to the equity method with adjustments made as if the equity method had been applied from
the initial acquisition. If the remaining equity does not enable joint control or significant influence it is
reclassified under the financial instrument standards with the difference between fair value and carrying value at
the date of losing control recognized in profit or loss. Other comprehensive income recognized before obtaining
control under the equity method or financial instrument standards is accounted for on the same basis as if the
investee had directly disposed of the related assets or liabilities. Changes in equity recognized under the equity
method due to other changes in the investee's equity (excluding net profit or loss other comprehensive income
and profit distribution) are reclassified to profit or loss at the date of losing control. For remaining equity
accounted for under the equity method other comprehensive income and other equity changes are proportionally
reclassified. For remaining equity reclassified under the financial instrument standards other comprehensive
income and other equity changes are fully reclassified.If the Company loses joint control or significant influence over an investee due to partial disposal of equity
investments the remaining equity is reclassified under the financial instrument standards with the difference
between fair value and carrying value at the date of losing joint control or significant influence recognized in
profit or loss. Other comprehensive income recognized under the equity method is accounted for on the same
basis as if the investee had directly disposed of the related assets or liabilities when the equity method is
discontinued. Changes in equity recognized due to other changes in the investee's equity (excluding net profit or
loss other comprehensive income and profit distribution) are fully reclassified to investment income when the
equity method is discontinued.If the Company disposes of its equity investments in a subsidiary step-by-step through multiple transactions until
control is lost and these transactions constitute a "package transaction" they are treated as a single transaction to
dispose of the subsidiary's equity investments and lose control. Before losing control the difference between the
disposal proceeds and the carrying value of the disposed equity corresponding to the long-term equity investment
is initially recognized in other comprehensive income and reclassified to profit or loss at the time control is lost.
15. Investment Properties
Investment properties refer to properties held to earn rental income or for capital appreciation or both. These
include leased land use rights land use rights held for future appreciation and transfer and leased buildings.Investment properties are initially measured at cost. Subsequent expenditures related to investment properties are
capitalized if it is probable that future economic benefits associated with the property will flow to the Company
and the cost can be measured reliably. All other subsequent expenditures are recognized in profit or loss asincurred.The Company applies the cost model for subsequent measurement of investment properties and depreciates or
amortizes them using policies consistent with those applied to buildings or land use rights.The impairment testing method and provision method for investment properties are detailed in Note V.20
"Impairment of Long-term Assets."
When owner-occupied properties or inventories are converted to investment properties or vice versa the carrying
amount prior to conversion is used as the post-conversion carrying amount.When the use of an investment property changes to owner-occupied the property is reclassified as fixed assets or
intangible assets from the date of change. When the use of owner-occupied property changes to rental or capital
appreciation purposes the fixed asset or intangible asset is reclassified as an investment property from the date of
change.For conversions:
To investment properties measured using the cost model the pre-conversion carrying amount is used as the
post-conversion carrying amount.To investment properties measured using the fair value model the fair value at the conversion date is used as the
post-conversion carrying amount.An investment property is derecognized when disposed of or permanently withdrawn from use with no expected
future economic benefits. Gains or losses from the sale transfer retirement or damage of investment properties
are calculated as the disposal proceeds minus the carrying amount and related taxes/expenses and are recognized
in profit or loss.
16. Fixed Assets
(1) Recognition Criteria for Fixed Assets
Fixed assets are tangible assets held for the production of goods provision of services rental or administrative
purposes with a useful life exceeding one accounting year. Fixed assets are recognized only when it is probable
that related economic benefits will flow to the Company and their costs can be reliably measured. Fixed assets are
initially measured at cost taking into account the effects of estimated abandonment costs.
(2) Depreciation Methods for Various Categories of Fixed Assets
Depreciation of fixed assets is calculated on a straight-line basis over their useful lives commencing from the
month following the date when the assets are ready for intended use. The useful lives estimated residual values
and annual depreciation rates for each category of fixed assets are as follows:
Estimated useful life
Category Depreciation method Depreciation rate (%)
(years)
Houses and buildings Straight-line method 20-40 2.50-5
Machinery equipment Straight-line method 6-15 6.67-16.67
Transportation equipment Straight-line method 5-10 10-20
Other equipment Straight-line method 5-10 10-20
(2) Estimated residual value refers to the amount that the Company currently expects to obtain from disposal of
the asset after deducting estimated disposal expenses assuming the fixed asset has reached the end of its expecteduseful life and is in the expected condition at that time.
(3) The impairment testing method and provision method for fixed assets are detailed in Note V.20 "Impairment of
Long-term Assets."
(4) Other Disclosures
Subsequent expenditures related to fixed assets are capitalized if it is probable that future economic benefits
associated with the fixed asset will flow to the Company and the cost can be measured reliably. The carrying
amount of replaced parts is derecognized. All other subsequent expenditures are recognized in profit or loss as
incurred.A fixed asset is derecognized when it is disposed of or when no future economic benefits are expected from its use
or disposal. Gains or losses arising from the sale transfer retirement or damage of fixed assets are calculated as
the disposal proceeds minus the carrying amount and related taxes/expenses and are recognized in profit or loss.The Company reviews the useful lives estimated residual values and depreciation methods of fixed assets at least
at each financial year-end. Changes in estimates are accounted for as changes in accounting estimates.
17. Construction in progress
The Company classifies construction in progress into two types: self-constructed and contractor-constructed.Construction in progress is transferred to fixed assets when the project is completed and reaches the intended
usable condition. The criteria for determining the intended usable condition shall meet any of the following
circumstances:
The physical construction (including installation) of the fixed asset has been fully completed or
substantially completed;
Trial production or test operation has been conducted and the results indicate that the asset can operate
normally or stably produce qualified products or the test operation results show that it can operate or
function normally;
The amount of expenditures on the construction of the fixed asset is minimal or almost no longer
occurs;
The constructed or acquired fixed asset has met or substantially met the design or contract requirements.When construction in progress reaches the intended usable condition it is transferred to fixed assets at the actual
project cost. For projects that have reached the intended usable condition but have not yet completed final
settlement they are first transferred to fixed assets at an estimated value. After final settlement is completed the
original provisional value is adjusted to the actual cost but no adjustment is made to previously calculated
depreciation.The impairment testing method and provision method for construction in progress are detailed in Note V.20
"Impairment of Long-term Assets."
18. Borrowing Costs
Borrowing costs include interest expenses on borrowings amortization of discounts or premiums ancillary costs
and exchange differences arising from foreign currency borrowings. Borrowing costs directly attributable to the
acquisition construction or production of a qualifying asset are capitalized when:
Expenditures for the asset have been incurred;
Borrowing costs have been incurred; and Activities necessary to prepare the asset for its intended use or sale have commenced.Capitalization ceases when the qualifying asset reaches its intended usable or saleable condition. All other
borrowing costs are recognized as expenses in the period in which they are incurred.For specific borrowings the amount to be capitalized is the actual interest expense incurred during the period less
any interest income earned on the unused portion of the borrowings deposited in banks or from temporary
investments.For general borrowings the amount to be capitalized is determined by multiplying the weighted average of
accumulated expenditures on the qualifying asset in excess of specific borrowings by the capitalization rate
applicable to the general borrowings. The capitalization rate is calculated based on the weighted average interest
rate of the general borrowings.During the capitalization period exchange differences on foreign currency specific borrowings are fully
capitalized while exchange differences on foreign currency general borrowings are recognized in profit or loss.A qualifying asset refers to assets such as fixed assets investment properties and inventories that require a
substantial period of time for their acquisition construction or production before they are ready for their intended
use or sale.If the acquisition construction or production of a qualifying asset is interrupted abnormally and the interruption
lasts for more than three consecutive months the capitalization of borrowing costs shall be suspended until the
acquisition construction or production activities recommence.A qualifying asset refers to assets such as fixed assets investment properties and inventories that require a
substantial period of time for their acquisition construction or production before they are ready for their intended
use or sale.
19. Intangible Assets
(1) Intangible Assets
Intangible assets refer to identifiable non-monetary assets without physical form that are owned or controlled by
the Company.Intangible assets are initially measured at cost. Expenditures related to intangible assets are capitalized if it is
probable that future economic benefits will flow to the Company and the costs can be reliably measured. All other
expenditures are recognized as expenses when incurred.Land use rights acquired are normally accounted for as intangible assets. For self-constructed buildings such as
factories the related land use rights expenditures and building construction costs are accounted for as intangible
assets and fixed assets separately. For purchased buildings the purchase price is allocated between the land use
rights and buildings. If the allocation cannot be made reasonably the entire amount is accounted for as fixed
assets.Intangible assets with finite useful lives are amortized on a straight-line basis over their estimated useful lives
from the date when they are available for use based on the original cost less estimated residual value and
accumulated impairment losses. Intangible assets with indefinite useful lives are not amortized.At the end of each period the useful lives and amortization methods of intangible assets with finite useful lives
are reviewed. Any changes are treated as changes in accounting estimates. In addition the useful lives of
intangible assets with indefinite useful lives are reviewed. If evidence indicates that the period of economic
benefits from the intangible asset is foreseeable its useful life is estimated and amortized according to the policy
for intangible assets with finite useful lives.(2) Research and Development Expenditures
The Company classifies internal research and development project expenditures into research phase expenditures
and development phase expenditures.Expenditures in the research phase are recognized as expenses when incurred.The Company's R&D expenditures include materials consumed labor and service costs amortization of R&D
equipment amortization of other intangible assets and fixed assets used in the development process and utilities
expenses.The Company's specific criteria for distinguishing between research phase and development phase expenditures:
The research phase refers to the stage of original and planned investigation undertaken to gain new scientific or
technical knowledge. The development phase refers to the stage of applying research findings or other knowledge
to a plan or design to produce new or substantially improved materials devices products etc. before commercial
production or use.Development phase expenditures are recognized as intangible assets only when all the following conditions are
met. Otherwise they are recognized as expenses when incurred:
* Technical feasibility of completing the intangible asset for use or sale;
* Intention to complete and use or sell the intangible asset;
* Ability to generate economic benefits including demonstrating a market for products using the intangible asset
or for the intangible asset itself or its usefulness for internal use;
* Availability of adequate technical financial and other resources to complete development and to use or sell the
intangible asset;
* Ability to reliably measure expenditures attributable to the development phase.The Company's specific conditions for capitalizing development phase expenditures: technical feasibility of
completion; intention to complete and use/sell; ability to generate economic benefits; availability of adequate
resources; and reliable measurement of attributable expenditures.If research phase and development phase expenditures cannot be distinguished all R&D expenditures are
recognized as expenses when incurred.
(3) Impairment Testing Method and Provision Method for Intangible Assets
The impairment testing method and provision method for intangible assets are detailed in Note V.20 "Impairment
of Long-term Assets."
20. Long-term Asset Impairment
For non-current non-financial assets such as fixed assets construction in progress intangible assets with finite
useful lives right-of-use assets investment properties measured at cost model and long-term equity investments
in subsidiaries joint ventures and associates the Company assesses at each balance sheet date whether there is
any indication of impairment. If any such indication exists the recoverable amount of the asset is estimated to
determine the impairment loss. Goodwill intangible assets with indefinite useful lives and intangible assets not
yet available for use are tested for impairment annually regardless of whether there is any indication of
impairment.When the recoverable amount is less than the carrying amount an impairment loss is recognized for the difference.The recoverable amount is the higher of an asset's fair value less costs of disposal and its value in use. Fair value
is determined based on the price in the sales agreement under fair transactions; if there is no sales agreement butan active market exists fair value is determined based on the asset's bid price; if neither exists fair value is
estimated based on the best available information. Costs of disposal include legal fees related taxes
transportation costs and other direct costs to bring the asset to a saleable condition. Value in use is determined by
discounting the estimated future cash flows expected from the asset's continuing use and ultimate disposal at an
appropriate discount rate. Impairment losses are calculated and recognized for individual assets. If it is difficult to
estimate the recoverable amount of an individual asset the recoverable amount is determined for the
cash-generating unit to which the asset belongs. A cash-generating unit is the smallest identifiable group of assets
that generates cash inflows independently.For goodwill presented separately in the financial statements the carrying amount of goodwill is allocated to
cash-generating units or groups of cash-generating units expected to benefit from the synergies of the business
combination when performing impairment tests. If the recoverable amount of a cash-generating unit or group of
units including allocated goodwill is less than its carrying amount the impairment loss is recognized. The
impairment loss is first allocated to reduce the carrying amount of goodwill allocated to the unit or group then to
other assets of the unit or group pro rata based on their carrying amounts.Once recognized impairment losses for the above assets are not reversed in subsequent periods.
21. Long-term Deferred Expenses
Long-term deferred expenses refer to expenses incurred but to be amortized over more than one year in the current
and future periods. The Company measures long-term deferred expenses at actual cost and amortizes them evenly
over the expected benefit period. For long-term deferred expenses that will not benefit future accounting periods
their carrying amounts are fully recognized in profit or loss when determined.
22. Contract Liabilities
Contract liabilities represent the Company's obligation to transfer goods or services to customers for which
consideration has been received or is receivable. If the customer has paid consideration or the Company has
obtained an unconditional right to payment before transferring goods or services the Company presents the
amount received or receivable as a contract liability at the earlier of when payment is actually received or when
payment is due. Contract assets and liabilities under the same contract are presented net while those under
different contracts are not offset.
23. Employee Benefits
The Company's employee benefits mainly include short-term employee benefits post-employment benefits and
termination benefits.Short-term benefits mainly include wages bonuses allowances and subsidies employee welfare expenses
medical insurance maternity insurance work injury insurance housing provident fund labor union funds and
employee education funds and non-monetary benefits. The Company recognizes actual short-term employee
benefits as liabilities during the accounting periods when employees render services and charges them to profit or
loss or relevant asset costs. Non-monetary benefits are measured at fair value.Post-employment benefits mainly include basic pension insurance and unemployment insurance.Post-employment benefit plans include defined contribution plans. For defined contribution plans the
corresponding payable amounts are charged to relevant asset costs or profit or loss when incurred.Termination benefits are recognized as employee benefit liabilities when the Company can no longer unilaterally
withdraw the termination benefits offered under the redundancy plan or proposal or when the Company
recognizes costs related to restructuring involving termination benefits whichever is earlier and charged to profit
or loss. However termination benefits expected to be paid more than twelve months after the reporting period are
treated as other long-term employee benefits.Internal retirement plans are accounted for using the same principles as termination benefits above. The Company
recognizes salaries and social insurance contributions to be paid to internally retired employees from the date they
stop rendering services to the normal retirement date as profit or loss (termination benefits) when the recognition
criteria for provisions are met.Other long-term employee benefits provided by the Company are accounted for as defined contribution plans if
they meet the criteria; otherwise they are accounted for as defined benefit plans.
24. Provisions
Provisions are recognized when the Company has a present obligation (legal or constructive) as a result of a past
event it is probable that an outflow of economic benefits will be required to settle the obligation and a reliable
estimate can be made of the amount of the obligation.Provisions are initially measured at the best estimate of the expenditure required to settle the present obligation
and the carrying amounts are reviewed at each balance sheet date.If all or part of the expenditure required to settle a provision is expected to be reimbursed by a third party the
reimbursement is recognized as a separate asset when its receipt is virtually certain and the amount recognized
does not exceed the carrying amount of the provision.
25. Share-based Payment
(1) Accounting Treatment for Share-based Payment
Share-based payment refers to transactions in which equity instruments are granted or liabilities based on equity
instruments are assumed in exchange for services provided by employees or other parties. Share-based payments
are classified into equity-settled share-based payments and cash-settled share-based payments.* Equity-settled Share-based Payment
For equity-settled share-based payments to obtain employee services the fair value of the equity instruments
granted is measured at the grant date.If the vesting of the equity instruments is conditional upon completing a specified service period or meeting
performance conditions the fair value is recognized over the vesting period on a straight-line basis based on
the best estimate of the number of instruments expected to vest with corresponding increases in capital
reserves.If the equity instruments vest immediately upon grant the fair value is recognized as an expense on the grant
date with a corresponding increase in capital reserves.At each balance sheet date during the vesting period the Company revises its estimate of the number of equity
instruments expected to vest based on the latest information (e.g. changes in the number of employees eligible for
vesting). Any adjustments are recognized in the current period’s costs or expenses with corresponding
adjustments to capital reserves.For equity-settled share-based payments to obtain services from non-employees:If the fair value of the services received can be reliably measured the expense is recognized based on the fair
value of the services at the acquisition date.If the fair value of the services cannot be reliably measured but the fair value of the equity instruments can the
expense is recognized based on the fair value of the equity instruments at the service acquisition date with a
corresponding increase in shareholders’ equity.* Cash-settled Share-based Payment
Cash-settled share-based payments are measured at the fair value of the liability incurred determined based on
shares or other equity instruments.If the instruments vest immediately upon grant the liability is recognized on the grant date as an expense.If vesting is conditional upon completing a service period or meeting performance conditions the expense is
recognized over the vesting period based on the best estimate of the number of instruments expected to vest
with a corresponding increase in liabilities.At each balance sheet date until settlement the liability is remeasured at fair value with changes recognized in
profit or loss.
(2) Accounting for Modifications or Terminations of Share-based Payment Plans
If a modification increases the fair value of the equity instruments granted the incremental fair value (i.e.the difference between the fair value before and after modification) is recognized as additional service cost.If a modification reduces the total fair value or is otherwise unfavorable to employees the original
accounting treatment continues as if the modification never occurred unless the equity instruments are
partially or fully canceled.If granted equity instruments are canceled during the vesting period the remaining unvested amount is
recognized immediately in profit or loss as an accelerated vesting expense with a corresponding adjustment
to capital reserves. If employees or other parties fail to meet non-vesting conditions (despite having the
option to do so) the grant is treated as canceled.
(3) Accounting for Share-based Payments Involving the Company’s shareholders or Controlling Parties
For share-based payment transactions between the Company and its shareholders or controlling parties where one
party (the settlement entity) is within the Company’s consolidated scope and the other (the service recipient) is
outside:
Consolidated Financial Statements Treatment:
If the settlement entity settles using its own equity instruments the transaction is treated as an equity-settled
share-based payment. Otherwise it is treated as a cash-settled share-based payment.If the settlement entity is an investor in the service recipient it recognizes a long-term equity investment at
the grant-date fair value of the equity instruments or liability with a corresponding increase in capital
reserves (other capital reserves) or liabilities.If the service recipient has no settlement obligation or grants its own equity instruments to employees the
transaction is treated as equity-settled. If the service recipient has a settlement obligation and grants
instruments other than its own equity the transaction is treated as cash-settled.Individual Financial Statements Treatment:
For transactions between entities within the Company’s consolidated scope where the service recipient and
settlement entity differ each entity accounts for the transaction in its individual financial statements following the
above principles.26. Other Financial Instruments Such as Preference Shares and Perpetual Bonds
(1) Classification of Perpetual Bonds and Preference Shares
Financial instruments such as perpetual bonds and preference shares issued by the Company shall be classified as
equity instruments only if they meet all of the following conditions:
* The instrument does not impose any contractual obligation to deliver cash or other financial assets to another
party or to exchange financial assets or liabilities under potentially unfavorable conditions;
* If settlement may or must occur using the Company’s own equity instruments in the future:
For non-derivative instruments there is no contractual obligation to deliver a variable number of the
Company’s own equity instruments for settlement;
For derivative instruments settlement can only be made by exchanging a fixed number of the Company’s
own equity instruments for a fixed amount of cash or other financial assets.Financial instruments issued by the Company that do not meet the above conditions shall be classified as financial
liabilities.For compound financial instruments issued by the Company:
The liability component is measured at fair value and recognized as a liability.The residual amount (total proceeds received minus the fair value of the liability component) is recognized
as "other equity instruments."
Transaction costs are allocated between the liability and equity components in proportion to their respective
shares of the total issuance proceeds.
(2) Accounting Treatment for Perpetual Bonds and Preference Shares
For perpetual bonds and preference shares classified as financial liabilities:
Interest dividends gains/losses and gains/losses from redemption or refinancing are recognized in profit or loss
except for borrowing costs eligible for capitalization (see Note III.18 "Borrowing Costs").For perpetual bonds and preference shares classified as equity instruments:
Issuance (including refinancing) repurchase sale or cancellation is treated as a change in equity with related
transaction costs deducted from equity.Distributions to holders of equity instruments are treated as profit distributions.The Company does not recognize changes in the fair value of equity instruments.
27. Revenue
The Company recognizes revenue when control of the relevant goods is transferred to the customer provided all
the following conditions are met: the contract has been approved by all parties who are committed to fulfilling
their respective obligations; the contract clearly specifies the rights and obligations of each party regarding the
goods or services to be transferred; the contract contains clear payment terms related to the goods to be transferred;
the contract has commercial substance meaning its performance will change the risk timing or amount of the
Company's future cash flows; and the consideration to which the Company is entitled for transferring goods to the
customer is probable of collection.At contract inception the Company identifies the distinct performance obligations in the contract and allocates the
transaction price to each performance obligation based on the relative stand-alone selling prices of the goods or
services promised. In determining the transaction price the Company considers the effects of variableconsideration significant financing components in the contract non-cash consideration and consideration payable
to customers.For each performance obligation the Company recognizes revenue over time by measuring progress toward
complete satisfaction of that performance obligation if any of the following criteria are met: the customer
simultaneously receives and consumes the benefits as the Company performs; the customer controls the asset as it
is created or enhanced; or the asset has no alternative use and the Company has an enforceable right to payment
for performance completed to date. Progress is measured using an input method appropriate to the nature of the
goods transferred. When progress cannot be reasonably measured revenue is recognized to the extent of costs
incurred that are expected to be recoverable until progress can be reasonably measured.If none of the above criteria are met revenue is recognized at the point in time when control of the goods is
transferred to the customer. In assessing whether control has transferred the Company considers indicators
including: the Company's present right to payment; transfer of legal title; physical possession; transfer of
significant risks and rewards of Ownership; customer acceptance; and other indicators of control transfer.For contracts with variable consideration the Company estimates the amount using either the expected value or
most likely amount method. The transaction price including variable consideration does not exceed the amount for
which it is highly probable that cumulative revenue recognized will not reverse when uncertainty is resolved. At
each reporting date the Company reassesses estimates of variable consideration included in the transaction price.Consideration payable to a customer is deducted from the transaction price unless it is for distinct goods or
services with the reduction recognized at the later of revenue recognition or payment (or commitment to pay)
date.The Company assesses whether it is a principal or agent based on whether it controls the goods or services before
transfer to the customer. As principal revenue is recognized at the gross amount of consideration; as agent
revenue is recognized at the net amount retained after paying other parties.The Company's specific revenue recognition methods are as follows:
Sales contracts typically contain a single performance obligation to transfer goods satisfied at a point in time.Domestic sales revenue is recognized when: goods are delivered and accepted per contract; payment is received or
collectability is probable; significant risks/rewards are transferred; and legal title passes.Export sales revenue is recognized when: goods are cleared through customs with bill of lading obtained; payment
is received or collectability is probable; significant risks/rewards are transferred; and legal title passes.Interest income is recognized based on time and effective interest rate.
28. Contract Costs
Contract costs comprise costs to fulfill and costs to obtain contracts.Costs to fulfill are capitalized as assets if:
(1) Directly related to a contract (labor materials overhead client-reimbursable costs);
(2) Enhance resources for future performance; and
(3) Probable of recovery.
Incremental costs to obtain contracts are capitalized if probable of recovery unless the amortization period would
be one year or less.Capitalized contract costs are amortized consistently with revenue recognition.Impairment losses are recognized when carrying amount exceeds the higher of:(1) Expected remaining consideration; and
(2) Estimated costs to complete transfer.
Reversals cannot exceed the carrying amount that would have existed without impairment.
29. Government Grants
Government grants refer to monetary or non-monetary assets obtained by the Company from the government
without compensation excluding capital contributions made by the government as an investor with corresponding
Ownership rights. Government grants are classified into asset-related government grants and income-related
government grants. Grants obtained for the acquisition or construction of long-term assets through other means
are defined as asset-related government grants; other government grants are defined as income-related
government grants. If government documents do not explicitly specify the grant recipient the following methods
are used to classify the grants:
(1) For government documents that specify particular projects classification is based on the relative proportion of
expenditures forming assets versus expenses in the project budget with this proportion reviewed at each balance
sheet date and adjusted if necessary;
(2) For government documents that only provide general descriptions of usage without specifying particular
projects the grants are treated as income-related government grants.Government grants in the form of monetary assets are measured at the amount received or receivable.Government grants in the form of non-monetary assets are measured at fair value; if fair value cannot be reliably
determined they are measured at nominal amount. Government grants measured at nominal amount are directly
recognized in current period profit or loss.The Company generally recognizes and measures government grants based on the actual amount received.However at period-end if there is conclusive evidence that the Company meets the relevant conditions of fiscal
support policies and expects to receive fiscal support funds the grants are measured at the receivable amount.Government grants measured at receivable amount must simultaneously meet the following conditions:
(1) The receivable grant amount has been confirmed by the competent government authority or can be reasonably
estimated based on officially released fiscal fund management regulations with no significant uncertainty
expected in the amount;
(2) The grants are based on fiscal support projects and corresponding fiscal fund management regulations
officially released by local finance departments in accordance with the "Government Information Disclosure
Regulations" and such regulations must be universally applicable (available to any enterprise meeting the
specified conditions) rather than specifically designed for particular enterprises;
(3) The relevant grant approval documents clearly specify the payment timeline and the payment is supported by
corresponding fiscal budgets thereby reasonably ensuring receipt within the stipulated period.Asset-related government grants are recognized as deferred income and systematically amortized into current
period profit or loss over the useful life of the relevant assets. Income-related government grants used to
compensate for future related costs expenses or losses are recognized as deferred income and amortized into
current period profit or loss when the related costs expenses or losses are recognized; those used to compensate
for already incurred related costs expenses or losses are directly recognized in current period profit or loss.Government grants containing both asset-related and income-related components are accounted for separately by
component; if the components cannot be reasonably distinguished the entire grant is classified as income-related.Government grants related to the Company's ordinary activities are recognized in other income or offset againstrelated costs and expenses based on the economic substance of the transaction; grants unrelated to ordinary
activities are recognized in non-operating income or expenses.When recognized government grants need to be returned any remaining deferred income balance is first
offset with any excess recognized in current period profit or loss; in other cases the return is directly recognized
in current period profit or loss.
30. Deferred Tax Assets/Deferred Tax Liabilities
Deferred tax assets or deferred tax liabilities are recognized based on the differences between the carrying
amounts and tax bases of assets and liabilities (including items not recognized as assets or liabilities but having
determinable tax bases under tax laws) calculated using the applicable tax rates expected to apply when the assets
are recovered or liabilities are settled.Deferred tax assets are recognized only to the extent that it is probable that taxable profit will be available against
which the deductible temporary differences can be utilized. At the balance sheet date if there is conclusive
evidence indicating sufficient taxable profit will likely be available in future periods to utilize deductible
temporary differences previously unrecognized deferred tax assets are recognized.At each balance sheet date the carrying amounts of deferred tax assets are reviewed. If it is no longer probable
that sufficient taxable profit will be available to realize the benefit of the deferred tax asset the carrying amount is
reduced. The reduction is reversed when it becomes probable that sufficient taxable profit will be available.The Company's current tax and deferred tax are recognized as income tax expense or income in profit or loss
except for income taxes arising from: business combinations; and transactions or events recognized directly in
equity.When the Company has a legally enforceable right to settle current tax assets and liabilities on a net basis and
intends either to settle on a net basis or to realize the asset and settle the liability simultaneously current tax assets
and current tax liabilities are presented net.
31. Leases
(1) The Company as a Lessee
The Company's leased assets are primarily buildings.At the commencement date of the lease term the Company recognizes right-of-use assets and lease liabilities for
leases other than short-term leases and leases of low-value assets and recognizes depreciation expenses and
interest expenses separately during the lease term.For short-term leases and leases of low-value assets the Company recognizes lease payments on a straight-line
basis as expenses in the respective periods of the lease term.* Right-of-use Assets
Right-of-use assets represent the lessee's right to use the leased asset during the lease term. At the commencement
date of the lease term right-of-use assets are initially measured at cost which includes:
The initial measurement amount of the lease liability;
Lease payments made at or before the commencement date less any lease incentives received;
Initial direct costs incurred by the lessee;
Estimated costs to be incurred by the lessee for dismantling and removing the leased asset restoring the site where
the asset is located or returning the asset to the condition required by the lease terms.The Company depreciates right-of-use assets using the straight-line method by category. For assets where
Ownership is reasonably certain to be obtained at the end of the lease term depreciation is calculated over the
remaining useful life of the leased asset. For assets where Ownership cannot be reasonably determined
depreciation is calculated over the shorter of the lease term or the remaining useful life of the leased asset.The Company determines whether right-of-use assets are impaired and accounts for them in accordance with the
relevant provisions of Accounting Standards for Business Enterprises No. 8—Impairment of Assets.* Lease Liabilities
Lease liabilities are initially measured at the present value of lease payments not yet paid at the commencement
date of the lease term. Lease payments include:
Fixed payments (including in-substance fixed payments) less any lease incentives;
Variable lease payments that depend on an index or rate;
Amounts expected to be payable under residual value guarantees provided by the lessee;
The exercise price of purchase options if the lessee is reasonably certain to exercise the option;
Payments required to exercise termination options if the lease term reflects the lessee exercising the termination
option.The Company uses the interest rate implicit in the lease as the discount rate; if this cannot be reasonably
determined the Company's incremental borrowing rate is used. Interest expenses on lease liabilities are calculated
using a fixed periodic interest rate and recorded in financial expenses. The periodic interest rate is the discount
rate or revised discount rate used by the Company.Variable lease payments not included in the measurement of lease liabilities are recognized in profit or loss when
incurred.When the Company's assessment of renewal options termination options or purchase options changes the lease
liability is remeasured at the present value of the revised lease payments using the revised discount rate with
corresponding adjustments to the carrying amount of the right-of-use asset. When in-substance fixed payments
expected payments under residual value guarantees or variable lease payments dependent on an index or rate
change the lease liability is remeasured at the present value of the revised lease payments using the original
discount rate with corresponding adjustments to the carrying amount of the right-of-use asset.* Short-term Leases and Leases of Low-value Assets
For short-term leases (leases with a term of 12 months or less at commencement date) and leases of low-value
assets (value below RMB 2000) the Company applies a simplified approach by not recognizing right-of-use
assets or lease liabilities and instead recognizes lease payments on a straight-line basis or another systematic and
rational basis as expenses in the respective periods of the lease term.
(2) The Company as a Lessor
* Operating Leases
The Company recognizes lease receipts from operating leases as rental income on a straight-line basis over the
lease term. Variable lease payments not included in lease receipts are recognized in profit or loss when incurred.* Finance Leases
At the commencement date of the lease term the Company recognizes finance lease receivables and derecognizes
the leased assets. Finance lease receivables are initially measured at the net investment in the lease (the sum of the
unguaranteed residual value and the present value of lease receipts not yet received at the commencement date
discounted using the interest rate implicit in the lease) with interest income recognized during the lease term
using a fixed periodic interest rate. Variable lease payments not included in the measurement of the net investmentin the lease are recognized in profit or loss when incurred.
32. Methods for Determining Materiality Thresholds and Basis for Selection
√Applicable □Not applicable
Disclosure Matters Involving Materiality Materiality Threshold Determination Methods and Selection
Judgment Criteria Basis
Significant individually assessed receivables Receivables with ending balance exceeding RMB
with specific bad debt provisions 1000000
Construction in progress projects either transferred to fixed
Material construction in progress
assets or with ending balance exceeding RMB 3000000
Significant accounts payable aged over one Accounts payable with ending balance exceeding RMB
year or past due 1000000
Advance receipts with ending balance exceeding RMB
Material advance receipts aged over one year
1000000
Contract liabilities with ending balance exceeding RMB
Material contract liabilities aged over one year
1000000
Other payables with ending balance exceeding RMB
Material other payables aged over one year
1000000
Significant cash receipts related to investing Individual investing activities with cash inflows exceeding
activities RMB 3000000
Significant cash payments related to investing Individual investing activities with cash outflows exceeding
activities RMB 3000000
Subsidiaries whose total assets exceed 5% of consolidated
Material non-wholly owned subsidiaries
total assets
33. Other Significant Accounting Policies and Accounting Estimates
Debt Restructuring
(1) Timing of Recognizing Debt Restructuring Gains and Losses
The Company may derecognize the relevant receivables and payables and recognize gains and losses related to
debt restructuring only on the debt restructuring completion date when the derecognition conditions for financial
assets and financial liabilities are met. The debt restructuring completion date refers to the date when the board of
directors and shareholders' meeting resolutions have been approved the debt restructuring agreement has been
signed or the court ruling has been issued the relevant assets have been transferred to the creditor the debt has
been converted into capital or the modified debt terms have commenced execution.For debt restructuring through asset settlement the recognition point is when the relevant assets have been
delivered and the Ownership transfer procedures have been completed. For debt restructuring through conversion
of debt into equity the recognition point is when the industrial and commercial registration procedures or the
equity registration with the registration authority have been completed. For debt restructuring through
modification of debt terms the recognition point is when it is determined that the terms can be performed and
execution has commenced. Debt restructuring negotiations that commenced during the reporting period but were
completed after the balance sheet date are not treated as post-balance-sheet events.
(2) Accounting Treatment by the Creditor
When the Company acts as a creditor the difference between the fair value of the relinquished claim and its
carrying amount is recognized in profit or loss.
(3) Accounting Treatment by the Debtor
A. For debt restructuring through asset settlement the relevant assets and the settled debt are derecognized when
the derecognition conditions are met. The difference between the carrying amount of the settled debt and the
carrying amount of the transferred assets is recognized in profit or loss.B. For debt restructuring through conversion of debt into equity instruments the settled debt is derecognized when
the derecognition conditions are met. The difference between the carrying amount of the settled debt and the
amount determined based on the fair value of the equity instruments is recognized in profit or loss.C. For debt restructuring through modification of other terms the restructured debt is re-recognized and
remeasured. The difference between the remeasured debt and the original debt is recognized in profit or loss.D. For debt restructuring through settlement with multiple assets or a combination of methods the equity
instruments and restructured debt are recognized and measured in accordance with the Accounting Standards for
Business Enterprises. The difference between the carrying amount of the settled debt and the sum of the carrying
amounts of the transferred assets and the recognized amounts of the equity instruments and restructured debt is
recognized in profit or loss.
34. Changes in Main Accounting Policies and Estimates
(1) Change of Accounting Policies
√ Applicable □ Not applicable
(2) Changes in Accounting Estimates
□Applicable √Not applicable
(3) Adjustments to Opening Balance Sheet Items for Initial Application of New Accounting Standards
Effective 2025
□Applicable √Not applicableVI. Taxation
1. Main Taxes and Tax Rate
Category of taxes Tax rate
Output VAT is calculated on taxable revenue at rates of 13% 9% 6%
VAT and 5% with VAT payable being the balance after deducting input VAT
credits allowable in the current period.Urban maintenance and Payment is calculated and made in accordance with local tax regulations
construction tax applicable to each tax-paying unit.Enterprise income tax See the table below for details.Notes of the disclosure situation of the taxpaying bodies with different enterprises income tax rates
Name Income tax rate
Changchai Company Limited 15%
Changchai Wanzhou Diesel Engine Co. Ltd. 15%
Changzhou Changchai Benniu Diesel Engine Fittings Co. Ltd. 25%
Changzhou Horizon Investment Co. Ltd. 25%
Changzhou Fuji Changchai Robin Gasoline Engine Co. Ltd. 15%
Jiangsu Changchai Machinery Co. Ltd. 25%
Changzhou Xingsheng Real Estate Management Co. Ltd. 5%
Zhenjiang Siyang Diesel Engine Manufacturing Co. Ltd. 15%
2. Tax Preference
(1) On November 6 2024 the Company renewed its High-Tech Enterprise Certification and continued to enjoy a
preferential corporate income tax rate of 15% during the reporting period.
(2) Controlled subsidiary Changchai Wanzhou Diesel Engine Co. Ltd. qualifies for the 15% reduced corporate
income tax rate from January 1 2011 to December 31 2030 under the Notice on Tax Policies for the
Implementation of the Western Development Strategy (jointly issued by the Ministry of Finance General
Administration of Customs and State Taxation Administration) and the Announcement on Extending Western
Development Enterprise Income Tax Policies (Ministry of Finance Announcement [2020] No. 23).
(3) On November 6 2023 wholly-owned subsidiary Changzhou Fuji Changchai Robin Gasoline Engine Co. Ltd.
renewed its High-Tech Enterprise Certification and applied the 15% preferential tax rate during the reporting
period.
(4) Wholly-owned subsidiary Changzhou Xingsheng Property Management Co. Ltd. as a qualified small and
low-profit enterprise applied the 5% reduced tax rate for such entities during the reporting period.(5) Subsidiary Zhenjiang Siyang Diesel Engine Manufacturing Co. Ltd. obtained its High-Tech Enterprise
Certification on December 12 2022 and maintained the 15% preferential tax rate during the reporting period.VII. Notes to Major Items in the Consolidated Financial Statements of the Company
1. Monetary Assets
Unit: RMB
Item Ending balance Beginning balance
Cash on hand 112615.57 84482.59
Bank deposits 753342442.15 933972475.61
Other monetary assets 104903403.70 129643534.39
Total 858358461.42 1063700492.59
Including: Total amount of funds
deposited overseas
Total amount of funds with usage
restrictions due to mortgage 144207257.20 171018607.75
pledge freezing or other reasons
Additional Notes:
At the end of the reporting period other monetary funds included:
Accrued interest on time deposits: RMB 312507.76
Restricted funds comprising:
Bill guarantees: RMB 102991363.01
Guarantee bonds and performance bonds: RMB 1903386.43
Time deposits: RMB 39312507.76
2. Trading Financial Assets
Unit: RMB
Item Ending balance Beginning balance
Financial assets at fair value
through profit or loss 420234569.30 303667459.65
Of which:
Stocks 67168729.00 52598990.00
Financial products 353065840.30 251068469.65
Of which:
Total 420234569.30 303667459.653. Notes Receivable
(1) Notes Receivable Listed by Category
Unit: RMB
Item Ending balance Beginning balance
Bank acceptance bill 144816296.81 318814017.13
Total 144816296.81 318814017.13
(2) Disclosure by Withdrawal Methods for Bad Debts
Unit: RMB
Ending balance Beginning balance
Carrying amount Bad debt Bad debtprovision Carrying amount provision
Category Carryi Carry
Withdr ng Withdr ing
Amou Propor Amou awal value Amoun Proport Amoun awal value
nt tion nt propor t ion t proport
tion ion
Notes
receivable for
which bad
debt 0.00 0.00% 0.00 0.00% 0.00 0.00 0.00% 0.00 0.00% 0.00
provision
separately
accrued
Of which:
Notes
receivable for
which bad 14481 100.00 14481 31881debt 6296. 100.00
3188
provision 81 %
00.00%6296.4017.1
813%
0.000.00%1401
7.13
accrued by
group
Of which:
Bank 14481 14481 31881 3188
acceptance 6296. 100.00% 0 0.00% 6296. 4017.1
100.000.000.00%1401
bills 81 81 3 % 7.13
14481
Total 6296. 100.00
14481318813188
%00.00%6296.4017.1
100.00
%0.000.00%1401818137.13
The allowance for doubtful accounts on notes receivable was recognized based on the general expected credit loss
model.□Applicable √Not applicable(3) Notes Receivable Pledged by the Company at the Period-end: None
(4) Notes Receivable which been Had Endorsed by the Company or had been Discounted but had not Due
on the Balance Sheet Date at the Period-end
Unit: RMB
Amount of recognition termination Amount of not terminated
Item
at the period-end recognition at the period-end
Bank acceptance bill 85332514.94
Total 85332514.94
(5) Notes Transferred to Accounts Receivable Due to Non-performance by Issuers at Period-end
As of the period-end there were no notes transferred to accounts receivable due to non-performance by issuers.
4. Accounts Receivable
(1) Disclosure by Aging
Unit: RMB
Aging Ending carrying amount Beginning carrying amount
Within 1 year (including 1 year) 1263684510.89 441388545.87
1 to 2 years 8053442.86 6801120.23
2 to 3 years 2139949.67 936696.44
Over 3 years 139096251.41 140104147.16
3 to 4 years 4156657.52 4100421.27
4 to 5 years 5117397.97 4863744.65
Over 5 years 129822195.92 131139981.24
Total 1412974154.83 589230509.70
(2) Disclosure by Withdrawal Methods for Bad Debts
Unit: RMB
Ending balance Beginning balance
Carrying Bad debt Carrying Bad debt
amount provision amount provision
Category CarryiWithd Withd Carryinng
Amou Propo Amou rawal value Amou Propor Amou rawal
g value
nt rtion nt propo nt tion nt propor
rtion tionAccounts
receivable
withdrawal of 2538 2538 2685 26856
100.0100.0
bad debt 6678. 1.80% 6678. 0.00 6788. 4.56% 788.6 0.00
0%0%
provision 05 05 69 9
separately
accrued
Of which:
Accounts
receivable
138713511252562311811
withdrawal of 98.20 95.44 21.00 444254
587429899.74%457573729480.
bad debt % % % 240.02
76.782.5884.201.0199
provision by
group
Of which:
Accounts
receivable for
which bad debt 1387 1351 1252 5623 11811
98.2095.4421.00444254
provision 5874 2989 9.74% 4575 7372 9480.%%%240.02
accrued by 76.78 2.58 84.20 1.01 99
credit risk
features group
141216051252589214497
444254
Total 9741 —— 1657 —— 4575 3050 —— 6269. ——
240.02
54.830.6384.209.7068
Individually Assessed Bad Debt Provisions: RMB 25386678.05 including significant impairment items of RMB
23609074.17. The details are presented below:
Unit: RMB
Beginning balance Ending balance
Withdraw
Name ReasonCarrying Bad debt Carrying Bad debt al
for
amount provision amount provision proportio
withdraw
n
Customer 1 5972101.90 5972101.90 5972101.90 5972101.90 100.00% Difficultto recover
Customer 2 4592679.05 4592679.05 4592679.05 4592679.05 100.00% Difficultto recover
Customer 3 2797123.26 2797123.26 2797123.26 2797123.26 100.00% Difficultto recover
Customer 4 2584805.83 2584805.83 2584805.83 2584805.83 100.00% Difficultto recoverCustomer 5 2025880.18 2025880.18 2025880.18 2025880.18 100.00% Difficultto recover
Customer 6 1902326.58 1902326.58 1902326.58 1902326.58 100.00% Difficultto recover
Customer 7 1759397.30 1759397.30 1759397.30 1759397.30 100.00% Difficultto recover
Customer 8 1564000.07 1564000.07 1564000.07 1564000.07 100.00% Difficultto recover
Customer 9 1470110.64 1470110.64 0.00 0.00 —— Difficultto recover
Customer 10 410760.00 410760.00 410760.00 410760.00 100.00% Difficultto recover
Total 25079184.81 25079184.81 23609074.17 23609074.17 -- --
Withdrawal of bad debt provision by group: Provision for bad debts by credit risk characteristic group
Unit: RMB
Ending balance
Name
Carrying amount Bad debt provision Withdrawal proportion
Within 1 year 1263684510.89 25273690.22 2.00%
1 to 2 years 8053442.86 402672.14 5.00%
2 to 3 years 2139949.67 320992.45 15.00%
3 to 4 years 3614394.86 1084318.46 30.00%
4 to 5 years 5117397.97 3070438.78 60.00%
Over 5 years 104977780.53 104977780.53 100.00%
Total 1387587476.78 135129892.58 --
The allowance for doubtful accounts on accounts receivable was recognized based on the general expected credit
loss model:
□Applicable √Not applicable
(3) Bad Debt Provision Withdrawal Reversed or Recovered in the Current Period
Withdrawal of bad debt provision:
Unit: RMB
Changes in the current period
Beginning
Category Reversed or Ending balancebalance Withdrawal Verification Others
recovered
Bad debt
provision
26856788.691470110.6425386678.05
separately
accruedWithdrawal
of bad debt
118119480.9917010411.59135129892.58
provision by
group
Total 144976269.68 17010411.59 1470110.64 160516570.63
(4) Accounts Receivable Written-off in Current Period
Unit: RMB
Item Written-off amount
Accounts receivable with actual verification 1470110.64
Of which the verification of significant accounts receivable:
Unit: RMB
Name of the Nature of the Verification
Arising from
Reason for related-party
entity accounts Verified amount proceduresreceivable verification performed transactions ornot
Accounts The court-ruled Minutes of the
Customer 1 receivable for 1470110.64 termination ofbankruptcy Executive Nogoods liquidation. Office
Total 1470110.64
(5) Top 5 of the Ending Balance of the Accounts Receivable and the Contract Assets Collected according to
Arrears Party
Unit: RMB
Ending balance
Proportion to of bad debt
Ending balance Ending balance Ending balance total ending provision ofName of the
entity of accounts of contract
of accounts balance of accounts
receivable assets receivable and accounts receivable andcontract assets receivable and impairment
contract assets provision for
contract assets
Customer 1 574387933.74 0.00 574387933.74 40.65% 11487758.68
Customer 2 245184220.00 0.00 245184220.00 17.35% 5172394.61
Customer 3 68402423.71 0.00 68402423.71 4.84% 1368048.47
Customer 4 48905454.18 0.00 48905454.18 3.46% 978109.09
Customer 5 44809044.30 0.00 44809044.30 3.17% 896180.89
Total 981689075.93 0.00 981689075.93 69.47% 19902491.745. Accounts Receivable Financing
(1) Accounts Receivable Financing Listed by Category
Unit: RMB
Item Ending balance Beginning balance
Bank acceptance bills 39513968.25 223261002.76
Total 39513968.25 223261002.76
(2) Notes Receivable Pledged by the Company at the Period-end: None
(3) Accounts receivable financing which had been endorsed by the Company or had discounted but had not
due at the period-end
Unit: RMB
Amount of recognition termination Amount of not terminated
Category
at the period-end recognition at the period-end
Bank acceptance bill 491724648.34
Total 491724648.34
(4) Changes in Receivables Financing and Fair Value Fluctuations During the Reporting Period
Unit: RMB
Beginning balance Changes in the current period Ending balance
Item FairFair Value Fair Value
Cost Cost Cost Value
Changes Changes
Changes
Notes
223261002.76-183747034.5139513968.25
Receivable
6. Other Receivables
Unit: RMB
Item Ending balance Beginning balance
Interest receivable 0.00 0.00
Dividend receivable 5016960.00 7165080.00
Other receivables 4163878.09 2682361.82
Total 9180838.09 9847441.82（1）Dividend receivable
Unit: RMB
Projects (or Investee Entities) Ending balance Beginning balance
Jiangsu Bank 5016960.00 7165080.00
Total 5016960.00 7165080.00
（2）Other Receivables
1) Other Receivables Classified by Accounts Nature
Unit: RMB
Nature Ending carrying value Beginning carrying value
Margin and cash pledge 1300.00 1300.00
Intercourse funds 24460949.84 23292830.56
Petty cash and borrowings by
1229119.81865253.08
employees
Other 14168017.12 14177743.14
Total 39859386.77 38337126.78
2) Disclosure by Aging
Unit: RMB
Aging Ending carrying amount Beginning carrying amount
Within 1 year (including 1 year) 3995234.65 2514999.73
1 to 2 years 115661.98 103639.66
2 to 3 years 364826.07 354590.84
Over 3 years 35383664.07 35363896.55
3 to 4 years 291173.68 281647.36
4 to 5 years 40541.20 30300.00
Over 5 years 35051949.19 35051949.19
Total 39859386.77 38337126.78
3) Disclosure by Withdrawal Methods for Bad Debts
√Applicable □Not applicable
Provision for bad debts based on general model of expected credit losses
Unit: RMBFirst stage Second stage Third stage
Expected loss in Expected loss in
Bad debt provision Expected credit the duration (credit the duration Total
loss of the next
impairment not (credit impairment
12 months
occurred) occurred)
Balance of 1 January
50296.5944388.9835560079.3935654764.96
2025
Balance of 1 January
2025 in the Current
Period
--Transfer to Second
stage
-- Transfer to Third stage
-- Reverse to Second
stage
-- Reverse to First stage
Withdrawal of the
40743.7240743.72
Current Period
Reversal of the Current
Period
Write-offs of the Current
Period
Verification of the
Current Period
Other changes
Balance of 30 June 2025 91040.31 44388.98 35560079.39 35695508.68
The basis for the division of each stage and the withdrawal proportion of bad debt provision: None
Changes of carrying amount with significant changes in amount of loss provision in the current period
□Applicable √Not applicable
4) Bad Debt Provision Withdrawn Reversed or Recovered in the Current Period
Withdrawal of bad debt provision:
Unit: RMB
Changes in the current period
Beginning Ending
Category
balance Reversed or Charged-off OtherWithdrawal balance
recovered /Written-off sBad debt
provision
5615869.555615869.55
separately
accrued
Withdrawal of
bad debt
30038895.4140743.7230079639.13
provision by
group
Total 35654764.96 40743.72 35695508.68
5）Write-off of Other Receivables During the Reporting Period: None
6) Top 5 of the Ending Balance of Other Receivables Collected according to the Arrears Party
Unit: RMB
Proportion to
total ending Ending
Name of the entity Nature Ending balance Aging balance of balance of bad
other debt provision
receivables %
Changzhou Compressor Intercourse
2940000.00 Over 5 years 7.38% 2940000.00
Factory funds
Changchai Group Imp. Intercourse
2853188.02 Over 5 years 7.16% 2853188.02
& Exp. Co. Ltd. funds
Changzhou New
Intercourse
District Accounting 1626483.25 Over 5 years 4.08% 1626483.25
funds
Center
Changchai Group Intercourse
1128676.16 Over 5 years 2.83% 1128676.16
Settlement Center funds
Chuangye Diesel Intercourse
1000000.00 Over 5 years 2.51% 1000000.00
Engine Repair Factory funds
Total 9548347.43 23.96% 9548347.43
7. Prepayments
(1) Prepayment Listed by Aging Analysis
Unit: RMB
Ending balance Beginning balance
Aging
Amount Proportion Amount ProportionWithin 1 year 12575782.99 91.50% 11874660.61 93.32%
1 to 2 years 557791.77 4.06% 355228.45 2.79%
2 to 3 years 591751.85 4.31% 489219.64 3.84%
Over 3 years 18873.12 0.14% 6850.00 0.05%
Total 13744199.73 -- 12725958.70 --
(2) Top 5 Prepayment in Ending Balance Collected according to the Prepayment Target
Unit: RMB
Name of the entity Ending balance Proportion of Total PrepaymentBalance at Period-End (%)
Suppliers 1 7817369.19 56.88%
Suppliers 2 686364.94 4.99%
Suppliers 3 672454.04 4.89%
Suppliers 4 553229.00 4.03%
Suppliers 5 377033.06 2.74%
Total 10106450.23 73.53%
8. Inventories
Whether the Company needs to comply with the disclosure requirements for the real estate industry: No
(1) Category of Inventory
Unit: RMB
Ending balance Beginning balance
Depreciation Depreciation
reserves of reserves of
inventories inventories
Item or orCarrying Carrying Carrying Carrying
impairment impairment
amount value amount value
provision for provision for
contract contract
performance performance
costs costs
Raw 227059659. 9276544.07 217783115. 210549278. 201282988.materials 84 77 77
9266290.45 32Materials
processed on 17687468.0 0.00 17687468.0 13598683.12 2 3 0.00
13598683.1
3
commission
Goods in 76560884.2 3708580.55 72852303.7 79357978.3 4128144.66 75229833.6
process 7 2 4 8
Finished 285159910. 31001488.6 254158422. 559878239. 32330091.1 527548148.goods 70 9 01 54 6 38
Low priced
and easily 1486523.64 0.00 1486523.64 1542344.91 0.00 1542344.91
worn articles
Total 607954446. 43986613.3 563967833. 864926524. 45724526.2 819201998.47 1 16 69 7 42
(2) Falling Price Reserves of Inventory and Impairment Reserves for Contract Performance Costs
Unit: RMB
Increase Decrease
Beginning
Item Transferred-ba
balance Other
Ending balance
Withdrawal Others ck or
s
charged-off
Raw materials 9266290.45 196786.24 186532.62 9276544.07
Goods in
4128144.66419564.113708580.55
process
Finished goods 32330091.16 811192.63 2139795.10 31001488.69
Total 45724526.27 1007978.87 2745891.83 43986613.31
9. Other Current Assets
Unit: RMB
Item Ending balance Beginning balance
The VAT tax credits 19196570.08 51823671.46
Prepaid corporate income tax 418076.10 2705816.46
Prepaid expense 62132.52 75533.75
Total 19676778.70 54605021.67
10. Other Equity Instrument Investment
Unit: RMB
Item Beginnin Gains Losses Accumul Accumul Dividend Ending Reasong balance recorded recorded ated gains ated income balance forin other in other recorded losses recognize assigning
comprehe comprehe in other recorded d in to
nsive nsive comprehe in other current measure
income in income in nsive comprehe year in fair
the the income in nsive value of
current current the income in which
period period current the changes
period current included
period other
comprehe
nsive
income
Non-tradi Non-tradi
ng equity 9411200 7850800 8350580 5016960 1019628 ng equity
investme 58.72 0.00 58.72 .00 058.72 investme
nt nt
94112007850800835058050169601019628
Total
58.720.0058.72.00058.72
Non-trading equity instrument investment disclosed by category
Unit: RMB
Reason for
assigning to
Amount of measure by Reason for
Dividend other fair value of
other
comprehensi
Item income Accumulated Accumulated comprehensi which
recognized e gains e losses ve transferred changes are
ve income
to retained included to transferred to
earnings other retained
comprehensi earnings
ve income
Changzhou
Synergetic
Innovation Non-trading
248637058.
Private equity
72
Equity Fund investment
(Limited
Partnership)
Non-trading
Foton Motor 349811000.equity
Co. Ltd. 00
investment
Bank of Non-trading
236610000.
Jiangsu Co. 5016960.00 equity
00
Ltd. investment
11. Long-term Equity Investment
Unit: RMBIncrease/decrease
Begin Gain Endin
Begin ning or Adjus Cash Withd Endin g
ning balan loss tmentof bonus rawal
g balan
Invest balan ce of Addit Redu recog Chan or of balan ce of
ees ce depre ional ced nized
other ce depre
(carry ciatio invest invest under comp
ges in profit depre
rehen other annou ciatio
Other (carry ciatio
ing n ment ment the sive equity nced n
ing n
value) reserv equity to reserv value) reserv
es metho income issue es
es
d
I. Joint venture
Subto
tal 0.00 0.00 0.00 0.00
II. Associated enterprises
Beijin
g
Tsing
hua
Indust
rial
44184418
Invest 0.00 0.00
2.502.50
ment
Mana
geme
nt
Co.Ltd.Subto 4418 4418
tal 0.00 0.002.50 2.50
44184418
Total 0.00 0.00
2.502.50
The recoverable amount is determined based on the net amount of the fair value minus disposal costs
□ Applicable √ Not applicable
The recoverable amount is determined by the present value of the forecasted future cash flow.□ Applicable √ Not applicable
The reason for the discrepancy between the foregoing information and the information used in the impairment
tests in prior years or external information: Not applicable
The reason for the discrepancy between the information used in the Company's impairment tests in prior years and
the actual situation of those years: Not applicable
12. Other Non-current Financial Assets
Unit: RMBItem Ending balance Beginning balance
Financial Assets at Fair Value Through Profit or
Loss (Including: Equity Instrument Investments) 377869217.49 377869217.49
Total 377869217.49 377869217.49
13. Investment Property
(1) Investment Property Adopting the Cost Measurement Mode
√ Applicable □ Not applicable
Unit: RMB
Item Houses and buildings Total
I. Original carrying value
1. Beginning balance 93077479.52 93077479.52
2. Increased amount of the period
(1) Outsourcing
(2) Transfer from inventories/fixed
assets/construction in progress
(3) Enterprise combination increase
3. Decreased amount of the period
(1) Disposal
(2) Other transfer
4. Ending balance 93077479.52 93077479.52
II. Accumulative depreciation and
accumulative amortization
1. Beginning balance 55336634.97 55336634.97
2. Increased amount of the period 1048356.78 1048356.78
(1) Withdrawal or amortization 1048356.78 1048356.78
3. Decreased amount of the period
(1) Disposal
(2) Other transfer
4. Ending balance 56384991.75 56384991.75
III. Depreciation reserves
1. Beginning balance
2. Increased amount of the period
(1) Withdrawal
3. Decreased amount of the period(1) Disposal
(2) Other transfer
4. Ending balance
IV. Carrying value
1. Ending carrying value 36692487.77 36692487.77
2. Beginning carrying value 37740844.55 37740844.55
The recoverable amount is determined based on the net amount of the fair value minus disposal costs
□ Applicable √ Not applicable
The recoverable amount is determined by the present value of the forecasted future cash flow.□ Applicable √ Not applicable
The reason for the discrepancy between the foregoing information and the information used in the impairment
tests in prior years or external information: Not applicable
The reason for the discrepancy between the information used in the Company's impairment tests in prior years and
the actual situation of those years: Not applicable
14. Fixed Assets
Unit: RMB
Item Ending balance Beginning balance
Fixed assets 577527877.32 615414505.40
Disposal of fixed assets 1430563.00 0.00
Total 578958440.32 615414505.40
(1) List of Fixed Assets
Unit: RMB
Houses and Machinery Transportation Other
Item Total
buildings equipment equipment equipment
I. Original
carrying value
1. Beginning
642502995.831119970538.2216042052.1062228077.381840743663.53
balance
2. Increased
amount of the 90458.72 101547.80 48672.57 792034.50 1032713.59
period
(1) Purchase 61946.91 48672.57 792034.50 902653.98(2) Transfer
from
90458.7239600.89130059.61
construction in
progress
(3) Enterprise
combination
increase
3. Decreased
amount of the 53218825.87 13000.00 24910.85 53256736.72
period
(1) Disposal or
53218825.8713000.0024910.8553256736.72
scrap
4. Ending
642593454.551066853260.1516077724.6762995201.031788519640.40
balance
II. Accumulated
Depreciation
1. Beginning
307135363.74863454931.2310774847.0243666795.441225031937.43
balance
2. Increased
amount of the 9960597.51 24780063.27 661454.95 2855756.32 38257872.05
period
(1) Withdraw 9960597.51 24780063.27 661454.95 2855756.32 38257872.05
3. Decreased
amount of the 0.00 52557356.25 13000.00 24910.85 52595267.10
period
(1) Disposal or
52557356.2513000.0024910.8552595267.10
scrap
4. Ending
317095961.25835677638.2511423301.9746497640.911210694542.38
balance
III. Impairment
Provision
1. Beginning
297220.70297220.70
balance
2. Increased
amount of the 0.00
period
(1) Withdraw 0.003. Decreased
amount of the 0.00
period
(1) Disposal or
0.00
scrap
4. Ending
297220.70297220.70
balance
IV. Carrying
value
1. Ending
325497493.30230878401.204654422.7016497560.12577527877.32
carrying value
2. Beginning
335367632.09256218386.295267205.0818561281.94615414505.40
carrying value
(2) List of Temporarily Idle Fixed Assets
Unit: RMB
Original Accumulative Depreciation
Item Carrying value Note
carrying value depreciation reserves
Houses and
59157112.1653291756.215865355.95
buildings
Transportation Refer to note 1
15654026.8614471987.161182039.70
equipment
Other equipment 55205.86 42500.63 12705.23
Machinery
309407.5012186.80297220.70
equipment
Note 1: Due to public interest requirements for urban redevelopment the People's Government of Xinbei District
Changzhou has decided to expropriate buildings within the scope of the Sanjing Subdistrict Foundry Plant and
surrounding area urban renewal project (Phase I). The expropriation area covers the Company's former foundry
base where some fixed assets of the original foundry base remain idle.
(3) Disposal of Fixed Assets
Unit: RMB
Item Ending balance Beginning balance
Compensation for Tenants of
Street-Facing Shops Along Metro 1430563.00 0.00
Line 5 Due to Demolition
Total 1430563.00 0.0015. Construction in Progress
Unit: RMB
Item Ending balance Beginning balance
Construction in progress 5332994.97 3376866.69
Engineering materials 0.00 0.00
Total 5332994.97 3376866.69
(1) List of Construction in Progress
Unit: RMB
Ending balance Beginning balance
Item Carrying Depreciatio Carrying Carrying Depreciati Carrying
amount n reserves value amount on reserves value
Technology
Center
Innovation
597345.00597345.00898041.60898041.60
Capability
Construction
Project
Equipment
Installation
4735649.974735649.972478825.092478825.09
Pending
Project
Miscellaneous
Engineering 5332994.97 5332994.97 3376866.69 3376866.69
Works
(2) Significant Changes in Construction-in-Progress Projects During the Current Period
Unit: RMB
Transfers to
Beginning Transfers to Ending Sources of
Item New additions intangible
balance fixed assets balance Funds
assets
Equipme
nt Equity
2478825.092386884.49130059.614735649.97
Installatio Funds
n Works
Total 2478825.09 2386884.49 130059.61 4735649.97 --（3）Impairment Test of Construction in Progress
□Applicable √Not applicable
16. Intangible Assets
(1) List of Intangible Assets
Unit: RMB
Trademark use
Item Land use right Software License fee Total
right
I. Original carrying
value
1. Beginning balance 205187775.71 21573652.88 5538000.00 1650973.47 233950402.06
2. Increased amount of
the period
(1) Purchase
(2) Internal R&D
(3) Business
combination increase
3. Decreased amount
of the period
(1) Disposal
4. Ending balance 205187775.71 21573652.88 5538000.00 1650973.47 233950402.06
II. Accumulated
amortization
1. Beginning balance 67655245.52 18451335.78 4348933.06 689101.84 91144616.20
2. Increased amount of
2090911.68655417.29274399.9782830.663103559.60
the period
(1) Withdrawal 2090911.68 655417.29 274399.97 82830.66 3103559.60
3. Decreased amount
of the period
(1) Disposal
4. Ending balance 69746157.20 19106753.07 4623333.03 771932.50 94248175.80
III. Depreciation
reserves
1. Beginning balance
2. Increased amount of
the period(1) Withdrawal
3. Decreased amount
of the period
(1) Disposal
4. Ending balance
IV. Carrying value
1. Ending carrying
135441618.512466899.81914666.97879040.97139702226.26
value
2. Beginning carrying
137532530.193122317.101189066.94961871.63142805785.86
value
17. Long-term Prepaid Expenses
Unit: RMB
Beginning Amortized Ending
Item Increase Decrease
balance amount balance
Trademark renewal fee 276383.95 205967.03 49982.25 432368.73
External power line
2388173.11159211.562228961.55
access project
Total 2664557.06 205967.03 209193.81 2661330.28
18. Deferred Income Tax Assets/Deferred Income Tax Liabilities
(1) Deferred Income Tax Assets that Had not Been Off-set
Unit: RMB
Ending balance Beginning balance
Item Deductible DeductibleDeferred income Deferred income
temporary temporary
tax assets tax assets
difference difference
Bad debt provision 29469410.60 4420411.59 12526884.12 1949082.99
Provisions 61700.00 9255.00 61700.00 9255.00
Advance tax paid
on pre-collected
demolition 30000000.00 4500000.00 30000000.00 4500000.00
compensation
Total 59531110.60 8929666.59 42588584.12 6458337.99(2) Deferred Income Tax Liabilities Had Not Been Offset
Unit: RMB
Ending balance Beginning balance
Item Taxable temporary Deferred income Taxable temporary Deferred income
difference tax liabilities difference tax liabilities
Assets evaluation
appreciation for
business
combination not 5308792.40 796318.85 5308792.40 796318.85
under the same
control
Changes of fair
value of other
equity instrument 1101483992.45 169053955.53 1008689955.98 153653533.48
investments
Total 1106792784.85 169850274.38 1013998748.38 154449852.33
(3) List of Unrecognized Deferred Income Tax Assets
Unit: RMB
Item Ending balance Beginning balance
Deductible temporary differences 210729282.02 214123380.22
Deductible tax losses 94504005.70 94504005.70
Total 305233287.72 308627385.92
(4) Deductible Losses of Unrecognized Deferred Income Tax Assets will be due in the Following Years
Unit: RMB
Years Ending balance Beginning balance
20294463227.364463227.36
20301489106.181489106.18
20311470853.201470853.20
203218875202.0327506664.76
203350340092.0150340092.01
20349234062.199234062.19
2035991941.62
Total 86864484.59 94504005.7019. Other Non-current Assets
Unit: RMB
Ending balance Beginning balance
Item Depreciati DepreciatiCarrying Carrying
on Carrying value on Carrying value
amount amount
reserves reserves
Prepayments
for the
acquisition 1448809.45 1448809.45 1448809.45 1448809.45
of long-term
assets
Assets held
for disposal 2924287.85 2924287.85 2924287.85 2924287.85
Total 4373097.30 4373097.30 4373097.30 4373097.30
20. Assets with Restricted Ownership or Right of Use
Unit: RMB
Ending balance Beginning balance
Item Carrying Carrying Type of Status of Carrying Carrying Type of Status of
amount value restriction restriction amount value restriction restriction
Bank
Bank
Acceptan
Acceptan
ce Bill
ce Bill
Guarante
Guarante
es Letter
es Letter
of
of
Guarante
Guarante
e
Occupied e Occupied
Monetary 1442072 1442072 1710186 1710186 Deposits
as cash Deposits as cash
assets 57.20 57.20 07.75 07.75 Performa
deposit Performa deposit
nce
nce
Bonds
Bonds
Time
Time
Deposits
Deposits
and
and
Accrued
Accrued
Interest
Interest
etc.Notes Payment At the
receivabl 7087820 7087820 Obligatio end of the
e -- 0.00 0.00 ns for reporting
outstandi Discounte periodng d Bills the
discounte Before Company
d notes Maturity had
discounte
d bills
that
remained
outstandi
ng as of
the
balance
sheet date
At the
At the
end of the
end of the
reporting
reporting
period
period
the
Notes Payment Payment the
Company
receivabl Obligatio Obligatio Company
had
e -- ns for ns for had
8533251 8533251 endorsed 1638581 1638581
outstandi Transferr Transferr endorsed
4.94 4.94 bills that 35.20 35.20
ng ed Bills ed Bills bills that
remained
transferre Before Before remained
outstandi
d notes Maturity Maturity outstandi
ng as of
ng as of
the
the
balance
balance
sheet
sheet date
date.
2295397229539740575494057549
Total
72.1472.1442.9542.95
21. Short-term Borrowings
(1) Category of Short-term Borrowings
Unit: RMB
Item Ending balance Beginning balance
Bank acceptance bills with
0.0094471787.41
financing nature
Total 0.00 94471787.4122. Notes Payable
Unit: RMB
Item Ending balance Beginning balance
Bank acceptance bill 631444212.92 491643629.88
Total 631444212.92 491643629.88
At the end of the current period there were no notes payable due and not paid.
23. Accounts Payable
(1) List of Accounts Payable
Unit: RMB
Item Ending balance Beginning balance
Payment for goods 716427585.20 690733575.75
Total 716427585.20 690733575.75
(2) Significant Accounts Payable Aging over One Year or Overdue
Unit: RMB
Item Ending balance Unpaid/ Un-carried-over reason
Payables for goods and services 75525725.11 Not yet settled
Payables for construction works
and equipment 6611150.27 Not yet settled
Total 82136875.38
24. Other Payables
Unit: RMB
Item Ending balance Beginning balance
Interest payable 0.00 0.00
Dividends payable 3891433.83 3891433.83
Other payables 126240298.01 113845527.69
Total 130131731.84 117736961.52
(1) Dividends Payable
Unit: RMB
Item Ending balance Beginning balance
Ordinary share dividends 3243179.97 3243179.97Dividends for non-controlling
648253.86648253.86
shareholders
Total 3891433.83 3891433.83
The reason for non-payment for over one year: Not received by shareholders yet.
(2) Other Payables
1) Other Payables Listed by Nature of Account
Unit: RMB
Item Ending balance Beginning balance
Margin & cash pledged 2635426.32 2595993.50
Intercompany balances 7250284.54 14989385.23
Personal advances and receivables 685263.25 647001.19
Sales discounts and product
98296760.6678652203.86
warranties
Other 17372563.24 16960943.91
Total 126240298.01 113845527.69
2) Significant Other Payables Aging over One Year
The significant other payables with aging over one year at period-end mainly consist of unsettled temporary
receipts and outstanding payables.
25. Advances from customers
(1) List of Advances from customers
Unit: RMB
Item Ending balance Beginning balance
Advance rental receipts 222448.06 183376.84
Advance receipts for land
30000000.0030000000.00
compensation
Total 30222448.06 30183376.84
26. Contract liabilities
Unit: RMB
Item Ending balance Beginning balance
Advance receipts from contracts 23469340.44 31640879.59Total 23469340.44 31640879.59
27. Employee benefits payable
(1) List of employee benefits payable
Unit: RMB
Item Beginning balance Increase Decrease Ending balance
I. Short-term salary 48792254.98 149916121.34 186829552.69 11878823.63
II.Post-employment
16563731.0216563731.02
benefit-defined
contribution plans
III. Termination
benefits
IV. Current portion
of other benefits
Total 48792254.98 166479852.36 203393283.71 11878823.63
(2) List of Short-term Salary
Unit: RMB
Beginning
Item Increase Decrease Ending balance
balance
1. Salary bonus
40690742.07126058062.82162971494.173777310.72
allowance subsidy
2.Employee welfare 1592.74 1532653.23 1532653.23 1592.74
3. Social insurance 9190596.41 9190596.41
Of which: Medical
7639627.527639627.52
insurance premiums
Work-related injury
764992.76764992.76
insurance
Maternity insurance 785976.13 785976.13
4. Housing fund 10791951.00 10791951.00
5.Labor union budget
and employee education 8099920.17 2342857.88 2342857.88 8099920.17
budget6. Short-term absence
with salary
7. Short-term profit
sharing scheme
Total 48792254.98 149916121.34 186829552.69 11878823.63
(3) List of Defined Contribution Plans
Unit: RMB
Beginning
Item Increase Decrease Ending balance
balance
1. Basic pension
16054596.2016054596.20
benefits
2. Unemployment
509134.82509134.82
insurance
3. Enterprise annuities
Total 16563731.02 16563731.02
28. Taxes Payable
Unit: RMB
Item Ending balance Beginning balance
VAT 529550.32 239602.32
Corporate income tax 385112.82 611800.65
Personal income tax 151818.37 210290.78
Urban maintenance and
construction tax 44166.17 19983.59
Property tax 1715080.20 1715080.20
Land use tax 943261.64 943261.64
Stamp duty 351365.61 437390.87
Education Surcharge 31747.23 14240.95
Comprehensive fees 23907.97 22673.70
Environmental protection tax 4176010.33 4214324.70
29. Other Current Liabilities
Unit: RMB
Item Ending balance Beginning balanceSale service fee 629835.18 485055.17
Transportation storage fee 525632.32 353692.31
Electric charge 2882683.36 2530866.25
Tax to be transferred 4025698.40 3818328.30
Estimated share value added tax 744480.00 745360.75
Obligation to pay bills transferred
85332514.94163858135.20
before maturity
Other withholding expenses 4106902.46 3273239.95
Total 98247746.66 175064677.93
30. Provisions
Unit: RMB
Item Ending balance Beginning balance Reason for formation
Product warranty 72125778.35 73002860.52 Estimated after-salesexpenses
Total 72125778.35 73002860.52
31. Deferred Income
Unit: RMB
Beginning Reason for
Item Increase Decrease Ending balance
balance formation
Government
Government
29386167.02 1704864.73 27681302.29 funding
grants
appropriation
Total 29386167.02 1704864.73 27681302.29 --
Note:
Liability items involving government grants
Unit: RMB
Amount
recorded into
Related to
Beginning Amount of other income
Item Ending balance assets/related
balance new subsidy in the
income
Reporting
Period
National major project
special allocations- Flexible
processing production line 8482569.00 759633.00 7722936.00 Related to assets
for cylinders of diesel
enginesRemove compensation 16515843.12 332986.81 16182856.31 Related to assets
Research and development
and industrialization
allocations of national III/IV
4387754.90 612244.92 3775509.98 Related to assets
standard high-powered
efficient diesel engine for
agricultural use
Total 29386167.02 1704864.73 27681302.29 ——
32. Share Capital
Unit: RMB
Increase/decrease (+/-)
Beginning Bonus Ending
balance New shares Bonus issue from Other Subtotal balance
issued shares
profit
The sum of 70569250 70569250
shares 7.00 7.00
33. Capital Reserves
Unit: RMB
Item Beginning balance Increase Decrease Ending balance
Capital premium
620338243.21620338243.21
(premium on stock)
Other capital reserves 20171432.63 20171432.63
Total 640509675.84 640509675.84
34. Other Comprehensive Income
Unit: RMB
Item Beginn Reporting Period Endinging Less: balance
balanc Less:Recorded
e Recorded inin other
other
comprehe Attributa
Income comprehensiv Attributa
nsive Less: ble to
before e income in ble to
income in Income the
taxation prior period non-cont
prior tax Compan
in the and rolling
period and expens y as the
Current transferred in interests
transferred e parent
Period retained after tax
in profit or after tax
earnings in
loss in the
the Current
Current
Period
Period
I. Other
comprehens
ive income 64306
that will not 785080 11776 667318 7097993
7549.9
be 00.00 200.00 00.00 49.91
reclassified 1
to profit or
loss
Changes in
fair value of 64306
785080117766673187097993
other equity 7549.9
00.00200.0000.0049.91
instrument 1
investment
Total of 64306
other 785080 11776 667318 7097993
7549.9
comprehens 00.00 200.00 00.00 49.91
ive income 1
Other notes including the adjustment of the effective gain/loss on cash flow hedges to the initial recognized
amount: None
35. Specific Reserve
Unit: RMB
Item Beginning balance Increase Decrease Ending balance
Safety production
21959066.356005031.873422736.1324541362.09
cost
Total 21959066.35 6005031.87 3422736.13 24541362.0936. Surplus Reserves
Unit: RMB
Item Beginning balance Increase Decrease Ending balance
Statutory surplus
reserves 354669807.37 354669807.37
Discretional surplus
reserves 13156857.90 13156857.90
Total 367826665.27 367826665.27
Surplus reserve explanation: Pursuant to the Company Law of the People's Republic of China and the company's
articles of association the Company appropriates 10% of its net profit as statutory surplus reserve.
37. Retained Earnings
Unit: RMB
Item Reporting Period Same period of last year
Beginning balance of retained
earnings before adjustments 983627999.95 1002436724.71
Total retained earnings at the
beginning of the adjustment period
(“+” means up “-” means down)
Beginning balance of retained
earnings after adjustments 983627999.95 1002436724.71
Add: Net profit attributable to
shareholders of the Company as 73422814.69 50097655.15
the parent
Less: Withdrawal of statutory
surplus reserves
Withdrawal of discretional
surplus reserves
Withdrawal of general
reserve
Dividend of ordinary shares
7056925.0733167547.83
payable
Dividends of ordinary shares
transferred as share capital
Ending retained earnings 1049993889.57 1019366832.03
Adjustments to opening retained earnings details:
(1) Retrospective adjustment due to the Accounting Standards for Business Enterprises and related new
regulations: RMB 0.00 impact on opening retained earnings.
(2) Change in accounting policies: RMB 0.00 impact on opening retained earnings.
(3) Correction of material accounting errors: RMB 0.00 impact on opening retained earnings.
(4) Changes in consolidation scope due to transactions under common control: RMB 0.00 impact on openingretained earnings.
(5) Other adjustments net impact on opening retained earnings: RMB 0.00.
38. Operating Revenue and Cost of Sales
Unit: RMB
Reporting Period Same period of last year
Item
Operating revenue Cost of sales Operating revenue Cost of sales
Main operations 1537977952.94 1342621700.34 1477768073.74 1232962844.33
Other operations 23208672.89 18852404.99 18141078.89 14141225.72
Total 1561186625.83 1361474105.33 1495909152.63 1247104070.05
Revenue-related information:
Contract Segment revenue 1 Total
Classification Operating revenue Cost of sales Operating revenue Cost of sales
By business type
Of which:
Diesel Engines -
560334413.42503705338.31560334413.42503705338.31
Single-Cylinder
Diesel Engines -
817669643.35724204343.91817669643.35724204343.91
Multi-Cylinder
Other Products 99606060.35 61214042.02 99606060.35 61214042.02
Parts &
60367835.8253497976.1060367835.8253497976.10
Accessories
By geographical
segment
Of which:
Domestic Sales 1304033625.65 1115976436.06 1304033625.65 1115976436.06
Export sales 233944327.29 226645264.28 233944327.29 226645264.28
Total 1537977952.94 1342621700.34 1537977952.94 1342621700.34
The revenue amount corresponding to performance obligations under contracts signed as of the end of the
reporting period that have not yet been fulfilled or partially fulfilled is RMB 0.00.
39. Taxes and Surtaxes
Unit: RMB
Item Reporting Period Same period of last year
Urban maintenance and
1698090.571206347.65
construction taxEducation surcharge 1333390.93 892462.87
Property tax 3460896.66 3460896.66
Land use tax 2237252.61 2237252.61
Vehicle and vessel use tax 1401.76 403.52
Stamp duty 1146892.36 1054326.09
Environment tax 51228.57 102132.33
Other 5269.40
Total 9929153.46 8959091.13
40. Administrative Expense
Unit: RMB
Item Reporting Period Same period of last year
Employee benefits 28224056.35 27401986.86
Office expenses 5107134.84 5393754.21
Depreciation and amortization 8395187.65 8902514.69
Safety expenses 3422736.13 2432550.21
Repair charge 358383.99 529280.85
Inventory scrap and inventory loss
(profit) 129856.36 133065.37
Consulting fees 121539.52 0.00
Insurance premiums 842173.89 877421.66
Utilities expenses 949597.73 913006.72
Other 3167743.10 6897048.89
Total 50718409.56 53480629.46
41. Selling Expense
Unit: RMB
Item Reporting Period Same period of last year
Employee benefits 23101018.93 21109483.94
Office expenses 4210906.58 2588140.70
Advertising and exhibition
expenses 645263.25 55147.17
Depreciation and amortization 356069.67 357084.57
Other 1581025.65 1023928.74
Total 29894284.08 25133785.1242. Development Costs
Unit: RMB
Item Reporting Period Same period of last year
Direct input expense 21849718.28 22523758.26
Employee benefits 11604885.34 11317402.28
Depreciation and amortization 2761687.13 2749281.31
Entrusted development charges 2675614.58 2174805.19
Other 38891905.33 38765247.04
43. Finance Costs
Unit: RMB
Item Reporting Period Same period of last year
Interest expense 704087.32 1546928.49
Less: Interest income 7108599.23 7969452.65
Net foreign exchange gains or
773408.70-2334179.75
losses
Other 12156.41 142352.25
Total -5618946.80 -8614351.66
44. Other Income
Unit: RMB
Amount included in
Same period of last non-recurring profit or
Sources Reporting Period
year loss for the current
period
VAT additional deduction 4683847.30
Withholding individual income
53705.85
tax handling fee refund
Government grants recognized
directly in current period profit 85535.00 248837.64 64535.00
or loss
Government grants related to
deferred income 1704864.73 1704864.73
The details of government subsidies are as follows:
Unit: RMB
Asset-related
Items Reporting Period grants/
Income-relatedgrants
National Major Special Fund Allocation - Flexible Machining
759633.00 Asset-related grants
Production Line for Diesel Engine Cylinder Blocks
Demolition Compensation - Hehai Road Land 133666.75 Asset-related grants
Demolition Compensation - Hehai Road Base Main Workshop 199320.06 Asset-related grants
National III/IV Standard High-Power Efficient Agricultural Diesel Asset-related grants
612244.92
Engine R&D and Industrialization Fund
Income-related
2024 Postdoctoral Work Assessment and Incentive Award 50000.00
grants
Municipal Science and Technology Innovation Incentive Fund & Income-related
14535.00
Technology Program Grant grants
Income-related
Job Stabilization Subsidy 21000.00
grants
Total 1790399.73 ——
45. Gain on Changes in Fair Value
Unit: RMB
Sources Reporting Period Same period of last year
Held-for-trading financial assets 15685633.55 -34487453.74
Total 15685633.55 -34487453.74
46. Investment Income
Unit: RMB
Item Reporting Period Same period of last year
Investment income from holding of trading
270311.71654815.85
financial assets
Investment income from disposal of trading
3198458.89
financial assets
Dividend income from holding of other equity
5016960.0010998000.00
instrument investment
Interest Income from Debt Investments During
499852.62
Holding Period
Securities Lending Business Revenue 74524.00
Investment Income from Wealth Management
474575.113371852.31
ProductsAccounts Receivable Financing - Discount Interest
-1389349.23-1300004.16
on Bank Acceptance Bills
Total 7570956.48 14299040.62
47. Credit Impairment Loss
Unit: RMB
Item Reporting Period Same period of last year
Bad debt loss of accounts
-17010411.59-17840474.15
receivable
Bad debt loss of other receivables -40743.72 2191.49
Total -17051155.31 -17838282.66
48. Asset Impairment Loss
Unit: RMB
Item Reporting Period Same period of last year
Loss on inventory valuation and
contract performance cost -1007978.87 -359995.80
Total -1007978.87 -359995.80
49. Asset Disposal Income
Unit: RMB
Amount included in
Same period of last non-recurring profit or
Sources Reporting Period
year loss for the current
period
Disposal income of fixed assets
2797353.31408245.542797353.31
and intangible assets
50. Non-operating Income
Unit: RMB
Amount included in
Item Reporting Period Same period of last year non-recurring profit or
loss for the current period
Income from penalty 20162.47 13396.22 20162.47
Accounts not required to be
410870.50
paidOther 121955.83 646668.47 121955.83
Total 142118.30 1070935.19 142118.30
51. Non-operating Expense
Unit: RMB
Amount included in
Item Reporting Period Same period of last year non-recurring profit or
loss for the current period
Donation 264014.59
Other 28702.13 3720.00 28702.13
Total 28702.13 267734.59 28702.13
52. Income Tax Expense
(1) List of Income Tax Expense
Unit: RMB
Item Reporting Period Same period of last year
Current income tax expense 12376782.62 12974889.92
Deferred income tax expense 1152893.45 -8660218.60
Total 13529676.07 4314671.32
(2) Adjustment Process of Accounting Profit and Income Tax Expense
Unit: RMB
Item Reporting Period
Profit before taxation 90533893.08
Current income tax expense accounted at statutory/applicable tax rate 13580083.96
Influence of applying different tax rates by subsidiaries 1425300.84
Influence of income tax before adjustment
Influence of non-taxable income -752544.00
Impact of non-deductible costs expenses and losses 612353.25
Impact of utilizing previously unrecognized deductible tax losses
Impact of unrecognized deductible temporary differences and tax losses in
current period 1129808.34
Impact of super-deduction incentives on income tax -2465326.32
Income tax expense 13529676.0753. Other Comprehensive Income
See Note VII 34 for details.
54. Cash Flow Statement
(1) Cash Related to Operating Activities
Cash Generated from Other Operating Activities
Unit: RMB
Item Reporting Period Same period of last year
Subsidy and appropriation 55752.64 55752.64
Other intercourses in cash 6861841.50 4561973.63
Interest income 7108599.23 7969452.65
Other 264430.97 201272.35
Total 14290624.34 12788451.27
Cash Used in Other Operating Activities
Unit: RMB
Item Reporting Period Same period of last year
Expense-type Expenditures 108145899.71 93802271.50
Other transactions 704087.32 1546928.49
Other 698581.31 789612.45
Total 109548568.34 96138812.44
55. Supplemental Information for Cash Flow Statement
(1) Supplemental Information for Cash Flow Statement
Unit: RMB
Supplemental information Reporting Period Same period of lastyear
1. Reconciliation of net profit to net cash flows generated from
operating activities
Net profit 77004217.01 53975129.61
Add: Provision for impairment of assets 1007978.87 -359995.80
Credit impairment loss 17051155.31
Depreciation of fixed assets of investment properties 39306228.83 38972508.82
Depreciation of right-of-use assets
Amortization of intangible assets 3103559.60 3046858.77Amortization of long-term deferred expenses 209193.81 500129.64
Losses on disposal of fixed assets intangible assets and
other long-term assets (gains by “-”) -2797353.31 -408245.54
Losses on the scrapping of fixed assets (gains by “-”)
Losses on the changes in fair value (gains by “-”) -15685633.55 34487453.74
Financial expenses (gains by “-”) 1477496.02 -8614351.66
Investment losses (gains by “-”) -8960305.71 -14299040.62
Decrease in deferred income tax assets (increase by “-”) -2471328.60 -2655243.07
Increase in deferred income tax liabilities (decrease by
“-”)3624222.05-16785433.67
Decrease in inventory (increase by “-”) 252488273.43 169505166.76
Decrease in accounts receivable from operating
activities (increase by “-”) -585436816.45 -431702702.30
Increase in payables from operating activities (decrease
by “-”) 145773002.06 12523252.32
Other
Net cash flows generated from operating activities -74306110.63 -161814513.00
2. Investing and financing activities that do not involve cash
receipts and payment:
Debt transferred as capital
Convertible corporate bond due within one year
Fixed assets from financing lease
3. Net increase in cash and cash equivalents
Ending balance of cash 714151204.22 643940187.59
Less: Beginning balance of cash 892681884.84 971629523.46
Add: Ending balance of cash equivalents
Less: Beginning balance of cash equivalents
Net increase in cash and cash equivalents -178530680.62 -327689335.87
(2) Cash Flows from Significant Investing Activities Received or Paid
Unit: RMB
Item Reporting Period
Cash received from significant investing activities
Including: Cash Received from Redemption of Wealth
Management Products Structured Deposits and Debt 643428229.00
Investments
Cash paid for significant investing activities
Including: Cash paid for purchase of wealth management
products and structured deposits 744553500.00(3) Cash and Cash Equivalents
Unit: RMB
Item Ending balance Beginning balance
I. Cash 714151204.22 892681884.84
Including: Cash on hand 112615.57 84482.59
Bank deposit on demand 713413662.01 891972475.61
Other monetary assets on demand 624926.64 624926.64
Accounts deposited in the central bank
available for payment
Deposits in other banks
Accounts of interbank
II. Cash equivalents
Of which: Bond investment expired within
three months
III. Ending balance of cash and cash
714151204.22892681884.84
equivalents
Of which: Cash and cash equivalents with
restriction in use for the Company as the
parent or subsidiaries of the Group
(4) Disclosure of changes in financing-related liabilities from opening to closing balances by category
Unit: RMB
Increase Decrease
Opening Closing
Item Cash Non-cash Non-cash
balance Cash changes balance
changes changes changes
Short-term
borrowing 94471787.41 94471787.41 0.00
s
Other
payables-d
3891433.830.003891433.83
ividends
payable
Total 98363221.24 94471787.41 3891433.8356. Foreign Currency Monetary Items
(1) Foreign Currency Monetary Items
Unit: RMB
Item Ending foreign currencybalance Exchange rate
Ending balance converted
to RMB
Monetary assets 245480049.55
Of which: USD 34241839.01 7.1586 245123628.74
HKD 390833.72 0.91195 356420.81
Accounts receivable 117699051.07
Of which: USD 16510399.71 7.1884 118683357.28
Contract liabilities 984306.21
Of which: EUR 117145.84 8.4024 984306.21
(2) Notes to Overseas Entities Including: for Significant Oversea Entities Main Operating Place Recording
Currency and Selection Basis Shall Be Disclosed; if there Are Changes in Recording Currency Relevant
Reasons Shall Be Disclosed.□Applicable √Not applicable
57. Lease
(1) The Company Was Lessor:
Operating leases with the Company as lessor
√Applicable □Not applicable
Unit: RMB
Of which: income related to
Item Rental income variable lease payments not
included in lease receipts
Lease income 900700.15
Total 900700.15
Finance leases with the Company as lessor
□Applicable √Not applicable
Undiscounted lease receipts for each of the next five years
□Applicable √Not applicable
Reconciliation of undiscounted lease receipts to net investment in leases: Not applicable
VIII. Research and Development Expenditure
Unit: RMBItem Amount for the current period Amount for the previous period
Direct input 21849718.28 22523758.26
Employee remuneration 11604885.34 11317402.28
Depreciation and amortization 2761687.13 2749281.31
Outsourcing development fees 2675614.58 2174805.19
Others 38891905.33 38765247.04
Total 38891905.33 38765247.04
Of which: Expensed research and
development expenditure 0.00 0.00
IX. Changes in the Scope of Consolidation
1. Changes in the Scope of Consolidation Due to Other Reasons
Description of changes in the scope of consolidation caused by other factors (e.g. newly established subsidiaries
liquidated subsidiaries etc.) and related circumstances:
During the reporting period wholly-owned subsidiary Changzhou Fuji Changchai Robin Gasoline Engine Co.Ltd. ("Changchai Robin") absorbed and succeeded all assets liabilities business operations and other rights and
obligations of wholly-owned subsidiary Changzhou Changchai Horizon Agricultural Equipment Co. Ltd.("Horizon Agricultural Equipment") through a statutory merger. In February 2025 the Company received the
Registration Notice (No. Deng Zi [2025] 02270081) issued by the Administrative Service Office of Changzhou
High-Tech Industrial Development Zone (Xinbei District) confirming the deregistration of Horizon Agricultural
Equipment’s independent legal entity status and the completion of the merger between the two wholly-owned
subsidiaries.X. Equity in Other Entities
1. Equity in Subsidiary
(1) Subsidiaries
Unit: RMB
Nature Holding percentage
Main Registra
Registered of (%) Way of
Name operating tion
capital busine
place place Indirect
gaining
ss Directly ly
Changchai Wanzhou
Chongqi Chongqi Indust
Diesel Engine Co. 85000000.00 60.00% Set-up
ng ng ry
Ltd.Changzhou
Changchai Benniu Changzh Changz Indust
55063000.00 99.00% 1.00% Set-up
Diesel Engine ou hou ry
Fittings Co. Ltd.Changzhou Horizon Changzh Changz Servic
40000000.00 100.00% Set-up
Investment Co. Ltd. ou hou e
Combinati
Changzhou Fuji
on not
Changchai Robin Changzh Changz Indust
37250000.00 100.00% under the
Gasoline Engine Co. ou hou ry
same
Ltd.control
Jiangsu Changchai Changzh Changz Indust
300000000.00 100.00% Set-up
Machinery Co. Ltd. ou hou ry
Changzhou
Xingsheng Property Changzh Changz Servic
1000000.00 100.00% Set-up
Management Co. ou hou e
Ltd.Zhenjiang Siyang Combinati
Diesel Engine on not
Manufacturing Co. 2000000.00
Zhenjian Zhenjia Indust
g ng ry 49.00% under the
Ltd. samecontrol
Notes:
1. Zhenjiang Siyang Diesel Engine Manufacturing Co. Ltd. (Zhenjiang Siyang)
The Company holds a 49% equity stake in Zhenjiang Siyang making it the largest shareholder.Other shareholders are dispersed with no single entity holding significant influence.Board Composition: Among the 7 board members 4 are appointed by the Company including the Chairman.Control Status: The Company is the de facto controller of Zhenjiang Siyang meeting the consolidation criteria
under applicable accounting standards.
2. Merger of Wholly-Owned Subsidiaries
Changchai Robin (wholly-owned subsidiary) absorbed and succeeded all assets liabilities business operations
and other rights/obligations of Horizon Agricultural Equipment (wholly-owned subsidiary) through a statutory
merger.As of February 2025 Horizon Agricultural Equipment’s independent legal entity status was deregistered
completing the merger process.
(2) Significant Non-wholly-owned Subsidiary
Unit: RMB
Name Shareholding The profit or loss Declaring Balance ofproportion of attributable to the dividends non-controlling
non-controllin non-controlling distributed to interests at the
g interests interests non-controlling period-end
interests
Changchai Wanzhou
40.00%450580.7321010950.99
Diesel Engine Co. Ltd.Zhenjiang Siyang Diesel
Engine Manufacturing 51.00% 3161584.44 60791034.94
Co. Ltd.Holding proportion of non-controlling interests in subsidiary different from voting proportion: Not applicable
(3) The Main Financial Information of Significant Not Wholly-owned Subsidiary
Unit: RMB
Ending balance Beginning balance
Non Non-
Non- Curre Non- Curre
Name Curre -cur Total Curre curre Totalcurre Total nt curre Total nt
nt rent liabili nt nt liabili
nt assets liabili nt assets liabili
assets liab ties assets liabili ties
assets ties assets ties
ility ty
Changch
ai
4602210567081455145544922153664515331533
Wanzho
9166793371009722972206972357305449234923
u Diesel.63.50.13.65.65.17.74.91.96.96
Engine
Co. Ltd.Zhenjian
g Siyang
Diesel 1049 2172 1266 9015 617 9076 1048 2269 1275 1653 1659
6170
Engine 0707 6905 3397 178. 00.0 878. 4937 5139 4451 7400 9100
0.00
Manufac 1.31 .36 6.67 99 0 99 4.35 .48 3.83 .72 .72
turing
Co. Ltd.Unit: RMB
Reporting Period Same period of last year
Cash Cash
Total Total
Name flows flowsOperating comprehe Operating comprehe
Net profit from Net profit from
revenue nsive revenue nsive
operating operating
income income
activities activitiesChangcha
i
Wanzhou 2500485 1126451 1126451 638950.0 2043683 487315.7 487315.7 494183.8
Diesel 8.48 .83 .83 1 8.02 6 6 9
Engine
Co. Ltd.Zhenjian
g Siyang
Diesel
Engine 4206635 6199185 6199185 7429071 4021227 6294954 62949541.38 .17 .17 .74 1.49 .12 .12 291189.2
Manufact 0
uring
Co. Ltd.
2. Equity in the Structured Entity Excluded in the Scope of Consolidated Financial Statements
Notes to the structured entity excluded in the scope of consolidated financial statements:
In 2017 the Company set up Changzhou Xietong Private Equity Fund (Limited Partnership) together with
Synergetic Innovation Fund Management Co. Ltd. through joint investment. On 18 October 2018 and 3
December 2020 new partners were respectively added. Partnership Shares transfer was made on 29 December
2022 and 10 October 2023. In line with the revised Partnership Agreement the general partner is Synergetic
Innovation Fund Management Co. Ltd. and the limited partners are Changchai Company Limited Changzhou
Zhongyou Petroleum Sales Co. Ltd. Changzhou Fuel Co. Ltd. Tong Yinzhu Tong Yinxin Anhui Haiyunzhou
Equity Investment Partnership Enterprise (Limited) Shenzhen Jiaxin One Venture Capital Partnership (limited
partnership)Zhong Wende and Qingdao Yinjiahui Industrial Investment Partnership Enterprise (Limited
Partnership). In accordance with the Partnership Agreement the limited partner does not execute the partnership
affairs. Thus the Company does not control Changzhou Xietong Private Equity Fund (Limited Partnership) and
did not include it into the scope of consolidated financial statements.XI. Government Grants
1. Government Grants Recognized at the End of the Reporting Period at the Amount Receivable
□Applicable √Not applicable
Reasons for failing to receive government grants in the estimated amount at the estimated point in time
□Applicable √Not applicable
2. Liability Items Involving Government Grants
√Applicable □Not applicable
Unit: RMB
Accounting Beginning Amount of Amount Amount Other Ending Related to
items balance new recorded recorded assets/relatsubsidy changes balanceinto into other ed incomenon-operati income in
ng income the
in the Reporting
Reporting Period
Period
Deferred 29386167 1704864. 27681302 Related to
income .02 73 .29 assets
3. Government Grants Recognized as Current Profit or Loss
√Applicable □Not applicable
Unit: RMB
Accounting items Amount for the current period Amount for the previous period
Other income 1790399.73 1897949.73
XII. The Risk Related to Financial Instruments
1. Various Types of Risks Arising from Financial Instruments
The Company’s principal financial instruments include financial assets at fair value through profit or loss other
equity instrument investments other non-current financial assets accounts receivable accounts payable etc.Detailed disclosures of these financial instruments are provided in the relevant sections of Note VII. The risks
associated with these financial instruments as well as the Company’s risk management policies to mitigate such
risks are described below. The Company’s management manages and monitors these risk exposures to ensure
they remain within defined limits.The Company employs sensitivity analysis to assess the potential impact of reasonably possible changes in risk
variables on current period profit or loss or shareholders’ equity. Since risk variables rarely change in isolation and
the correlation between variables significantly influences the ultimate impact of changes in any single variable
the following analysis assumes each variable changes independently.
1. Risk Management Objectives and Policies
The Company’s risk management objectives are to achieve an appropriate balance between risk and return
minimize the adverse impact of risks on operational performance and maximize the interests of shareholders and
other equity investors. Based on these objectives the Company’s fundamental risk management strategy involves
identifying and analyzing risks establishing risk tolerance thresholds implementing risk management measures
and conducting reliable monitoring to maintain risks within defined limits.
(1) Market Risk
* Foreign Exchange Risk
Foreign exchange risk refers to the risk of loss due to exchange rate fluctuations. The Company is primarily
exposed to foreign exchange risk related to USD and EUR. Apart from overseas operations denominated in USD
and EUR the Company’s other major business activities are settled in RMB. As of June 30 2025 the Company’s
foreign currency monetary items include cash and cash equivalents accounts receivable and accounts payable
(see Note VII.57). The foreign exchange risk arising from these assets and liabilities may impact the Company’s
financial performance.The Company closely monitors the effects of exchange rate fluctuations on its foreign exchange risk exposure.* Interest Rate Risk – Cash Flow Variability Risk
The Company’s exposure to cash flow variability due to interest rate changes primarily relates to floating-ratebank deposits. The Company’s policy is to maintain these deposits at floating rates.* Other Price Risk
The Company’s investments classified as financial assets at fair value through profit or loss or fair value through
other comprehensive income are measured at fair value at the balance sheet date. Consequently the Company is
exposed to price volatility in the securities market. The Company mitigates equity price risk by maintaining a
diversified portfolio of equity securities.
(2) Credit Risk
Credit risk refers to the risk that one party to a financial instrument fails to fulfill its obligations resulting in
financial loss to the other party.The Company’s credit risk primarily arises from receivables. To manage this risk the Company has implemented
the following measures:
* Transactions are conducted only with approved and creditworthy third parties.* Credit assessments are performed for all customers requesting credit terms.* Accounts receivable balances are continuously monitored to avoid significant bad debt exposure.Credit Risk Exposure:
* Cash and bank acceptance bills have low credit risk as they involve reputable highly rated banks.* Other financial assets (e.g. accounts receivable other receivables) are exposed to counterparty default risk
with maximum exposure equal to their carrying amounts.The Company does not require collateral as it transacts only with approved and creditworthy parties. Credit risk
concentration is managed by customer. As of June 30 2025 69.47% of the Company’s accounts receivable
balance was attributable to its top five customers. No collateral or credit enhancements are held for accounts
receivable.Criteria for Significant Increase in Credit Risk:
At each reporting date the Company assesses whether credit risk has increased significantly since initial
recognition. This evaluation considers qualitative and quantitative factors including historical data external credit
ratings and forward-looking information.A significant increase in credit risk is deemed to occur when one or more of the following triggers are met:
* Quantitative: Probability of default (PD) increases by a material margin compared to initial recognition.* Qualitative: Material adverse changes in the debtor’s financial condition or inclusion in a watchlist.Definition of Credit-Impaired Assets:
To determine credit impairment the Company aligns with internal risk management objectives and considers
quantitative and qualitative indicators including:
* Significant financial difficulty of the debtor;
* Breach of contract (e.g. payment default or delinquency);
* Concessions granted due to the debtor’s financial distress;
* Likelihood of bankruptcy or restructuring;
* Disappearance of an active market for the asset;
* Purchase or origination of a financial asset at a deep discount reflecting credit loss.Expected Credit Loss (ECL) Measurement Parameters:
ECL is measured based on 12-month or lifetime expected credit losses depending on whether credit risk hasincreased significantly or impairment has occurred. Key parameters include:
* Probability of Default (PD): Likelihood of default within 12 months or the remaining lifetime. Adjusted for
forward-looking macroeconomic factors.* Loss Given Default (LGD): Expected loss severity upon default varying by counterparty type recourse and
collateral.* Exposure at Default (EAD): Amount expected to be owed at the time of default.Forward-Looking Information:
ECL calculations incorporate forward-looking macroeconomic indicators analyzed through historical data
regression and expert judgment.
(3) Liquidity Risk
The Company manages liquidity risk by maintaining sufficient cash and cash equivalents monitored to meet
operational needs and mitigate cash flow volatility. Management ensures compliance with borrowing agreements
and monitors bank loan utilization.
2. Financial Assets
(1) Classification of Transfer Methods
√Applicable □Not applicable
Unit: RMB
Transfer Nature of Amount of Recognition
method transferred transferred termination or Basis for recognition terminationfinancial assets financial assets not
Endorsement Notes Not
The Company retains substantially all
receivable 85332514.94 derecognized of the risks and rewards including therisk of default associated with its
Endorsement Accounts
/discount receivable 491724648.34 Derecognized
The Company transfers almost all the
financing risks and rewards
Total 577057163.28
(2) Financial Assets Derecognized due to Transfer
√Applicable □Not applicable
Unit: RMB
Item Transfer method of Amount of derecognized Gains or losses related tofinancial assets financial assets derecognition
Accounts
receivable Endorsement 461724648.34
financing
Accounts
receivable Discount 30000000.00 -1389349.23
financing
Total 491724648.34 -1389349.23(3) Continued Involvement in the Transfer of Assets Financial Assets
√Applicable □Not applicable
Unit: RMB
Item Transfer method of Amount of assets resulting from Amount of liabilities resultingassets continued involvement from continued involvement
Notes receivable Endorsement 85332514.94 85332514.94
Total 85332514.94 85332514.94
XIII. The Disclosure of Fair Value
1. Ending Fair Value of Assets and Liabilities at Fair Value
Unit: RMB
Ending fair value
Item Fair value Fair value Fair value
measurement items measurement items measurement items Total
at level 1 at level 2 at level 3
I. Consistent fair
value measurement -- -- -- --
(I) Trading financial
assets
1. Financial assets
at fair value through
profit or loss
(1) Debt instrument
investment
(2) Equity
instrument 67168729.00 67168729.00
investment
(3) Derivative
financial assets
(4) Wealth
management 353065840.30 353065840.30
investments
2. Financial assets
designated to be
measured at fair
value and the
changes included
into the current
profit or loss
(1) Debt instrument
investment
(2) Equity
instrument
investment
(II) Otherinvestments in debt
obligations
(III)Other equity
instrument 670991000.00 348637058.72 1019628058.72
investment
(IV) Investment
property
1. Land use right
for lease
2. Buildings leased
out
3. Land use right
held and planned to
be transferred once
appreciating
(V) Living assets
1. Consumptive
living assets
2. Productive living
assets
Accounts receivable
financing 39513968.25 39513968.25
Other non-current
financial assets 377869217.49 377869217.49
Total assets
consistently
measured by fair 738159729.00 353065840.30 766020244.46 1857245813.76
value
(VI) Trading
financial liabilities
Of which: Issued
trading bonds
Derivative financial
liabilities
Other
(VII) Financial
liabilities
designated to be
measured at fair
value and the
changes recorded
into the current
profit or loss
Total liabilities
consistently
measured by fair
value
II. Inconsistent fair
value measurement(1) Assets held for
sale
Total assets
inconsistently
measured by fair
value
Total liabilities
inconsistently
measured by fair
value
2. Market Price Recognition Basis for Consistent and Inconsistent Fair Value Measurement Items at Level
For the listed company stocks held by the company in the held-for-trading financial assets measured at fair value
the closing market price on the balance sheet date was the basis for the measurement of fair value.
3. Valuation Technique Adopted and Nature and Amount Determination of Important Parameters for
Consistent and Inconsistent Fair Value Measurement Items at Level 2
Wealth management and investment: The underlying assets of investment in wealth management products include
bond assets deposit assets fund assets etc. The portfolio of investment assets should be dynamically managed.The fair value of wealth management products should be adjusted according to the yield of similar products
provided by the counterparty.
4. Valuation Technique Adopted and Nature and Amount Determination of Important Parameters for
Consistent and Inconsistent Fair Value Measurement Items at Level 3
(1) Accounts receivable financing: Accounts receivable financing is a bank acceptance with high credit rating
short maturity and low risk. The par amount is close to the fair value and is used as the fair value.
(2) Among other non-current financial assets:
The equity instrument investment in Jiangsu Horizon New Energy Technology Co. Ltd. (a manufacturer of
lithium battery separators whose main products include coated products and base films primarily used in new
energy vehicle power batteries 3C consumer batteries and energy storage batteries) is characterized by high
technical complexity lengthy R&D cycles and substantial capital investment. The company is in a rapid
development phase with numerous investment projects still under construction that have not yet generated stable
revenue or profits. However financing activities have been frequent with five equity financings conducted in the
past three years. Accordingly the Company has determined the fair value of this equity investment using the most
recent financing price adjustment method and engaged an appraisal firm to validate the valuation.
(3) Among other equity instrument investments:
The investments in Chengdu Changwan Diesel Engine Sales Co. Ltd. Chongqing Wanzhou Changwan Diesel
Engine Parts Co. Ltd. Changzhou Economic and Technological Development Company Changzhou Tractor
Company Changzhou Industrial Capital Mutual Aid Association of the Economic Commission and Beijing
Engineering Machinery Agricultural Machinery Company totaling RMB 1.21 million are measured at a fair
value of RMB 0.00 due to the recoverability of the invested amounts.For Changzhou Collaborative Innovation Equity Investment Partnership (Limited Partnership) established in
October 2017 the year-end partners' equity has increased due to fair value changes in its equity holdings. No
material changes have occurred in its operating environment business conditions or financial position. Thus the
Company has determined its fair value based on the partnership’s net asset value at the period-end.
5. Transfers Between Fair Value Hierarchy Levels for Recurring Fair Value Measurements: Reasons for
Transfers and Policies for Determining Transfer Timing
During the current year no transfers occurred between Level 1 and Level 2 of the fair value hierarchy for the
Company’s financial assets and liabilities nor were there any transfers into or out of Level 3.
6. Changes in Valuation Techniques and Reasons for Such Changes During the Period
No changes were made to valuation techniques during the reporting period.
7. Fair Value Information of Financial Assets and Liabilities Not Measured at Fair Value
The financial assets and liabilities measured at amortization cost mainly include notes receivable accounts
receivable other receivables short-term borrowings accounts payable other payables etc. The difference
between the carrying value and fair value for financial assets and liabilities not measured at fair value is small.XIV. Related Party and Related-party Transactions
1. Information Related to the Company as the Parent of the Company
Proportion of Proportion of
share held by voting rights
Regist
Registered the Company as owned by the
Name ration Nature of business
capital the parent Company as the
place
against the parent against
Company the Company
Investment and operations of
state-owned assets assets
Changzhou
management (excluding
Investment Chang RMB1.2
financial business) investment 32.26% 32.26%
Group Co. zhou billion
consulting (excluding
Ltd.consulting on investment in
securities and options) etc.Information about the parent company of the enterprise:
The parent company of the enterprise is Changzhou Investment Group Co. Ltd. According to the
"Implementation Plan for Transferring Part of State-owned Capital to Enrich Social Security Funds in Jiangsu
Province" (Su Zhengfa [2020] No. 27) issued by the provincial government the "Notice on Transferring Part of
State-owned Capital in Cities and Counties to Enrich Social Security Funds" (Su Caigongmao [2020] No. 139)
issued by Jiangsu Provincial Department of Finance and five other departments and the "Notice on TransferringPart of Municipal (District) State-owned Capital to Enrich Social Security Funds" (Chang Caigongmao [2020] No.
4) issued by Changzhou Municipal Finance Bureau and four other departments 10% of the state-owned equity of
the Investment Group held by the People's Government of Changzhou City was transferred to Jiangsu Provincial
Department of Finance without compensation. After the equity transfer the People's Government of Changzhou
City holds 90% of the state-owned equity of Changzhou Investment Group Co. Ltd. and Jiangsu Provincial
Department of Finance holds 10% of the state-owned equity of Changzhou Investment Group Co. Ltd. According
to the document of the People's Government of Changzhou City (Chang Zhengfa [2006] No. 62) Changzhou
Investment Group Co. Ltd. is an enterprise where the State-owned Assets Supervision and Administration
Commission of Changzhou City performs the investor's responsibilities as authorized by the People's Government
of Changzhou City. Therefore Changzhou Investment Group Co. Ltd. is the controlling shareholder of the
company and the State-owned Assets Supervision and Administration Commission of Changzhou City remains
the actual controller of the company. The ultimate controlling party of the enterprise is the State-owned Assets
Supervision and Administration Commission of Changzhou City.
2. Subsidiaries of the Company
Refer to Note X for details.
3. Situation of joint ventures and associated enterprises of the company
For details refer to Note VII.11 "Long-term Equity Investments" in the accompanying financial statements.
4. Information on Other Related Parties
Name Relationship with the Company
Changzhou Synergetic Innovation Private Equity Participated in establishing the industrial investment
Fund (Limited Partnership) fund
Jiangsu Horizon New Energy Technology Co. Ltd. Shareholding enterprise of the Company
5. Related Party Transactions: None
XV. Commitments and Contingency
1. Significant Commitments
Significant commitments on balance sheet date:
As of 30 June 2025 there was no significant commitment for the Company to disclose.2. Contingency
(1) Significant Contingency on Balance Sheet Date: None
(2) Despite no Significant Contingency to Disclose the Company Shall Also Make Relevant Statements
There was no significant contingency in the Company.XVI. Events after Balance Sheet Date
1. Profit Distribution: None
2. Notes to Other Events after Balance Sheet Date
As of the date of this report the Company has no other significant post-balance-sheet events requiring disclosure.XVII. Other Significant Events
1. Segment Information
(1) Basis for Determining Reportable Segments and Accounting Policies
As the Company and its major subsidiaries operate similar business activities under unified management without
separate business units the Company operates as a single reportable segment.
2. Other Significant Transactions and Events Relevant to Investors' Decision-Making: None
XVIII. Notes of Main Items in the Financial Statements of the Company as the Parent
1. Accounts Receivable
(1) Disclosure by Aging
Unit: RMB
Aging Ending carrying amount Beginning carrying amount
Within one year (including 1 year) 1227288459.74 421962024.85
One to two years 8009829.79 6757507.16
Two to three years 2139949.67 936696.44
More than three years 98641285.62 99831716.27
Three to four years 4097432.37 4041196.12
Four to five years 4454600.04 4363228.39
Over 5 years 90089253.21 91427291.76
Total 1336079524.82 529487944.72(2) Disclosure by Withdrawal Methods for Bad Debts
Unit: RMB
Ending balance Beginning balance
Carrying Bad debt Bad debt
Carrying amount
amount provision provision
Category Carry CarryiWithd ing Withd ng
Amou Propor Amou rawal value Amoun Propor Amou rawal value
nt tion nt propor t tion nt propo
tion rtion
Accounts
receivable
withdrawal of 1263 12637 14107
100.014107100.0
Bad debt 7872. 0.95% 872.1 0.00 2.66% 982.7 0.00
0%982.760%
provision 12 2 6
separately
accrued
Of which:
Accounts
receivable
132310694121651537904334249
withdrawal of 99.05 97.34 17.55
44164389.8.08%49729961.9295.54666
bad debt % % %
52.705563.15656.41
provision of by
group
Of which:
Accounts
receivable with
provision for 1320 10694 1213 51470 90433 4242
98.8597.2117.57
bad debts based 6507 4389. 8.10% 7063 4286.4 295.5 7099
%%%
on credit risk 39.02 55 49.47 7 5 0.92
characteristics
portfolio
Accounts
receivable with
provision for
bad debts based
27902790
on related-party 67567 6756
913.60.21%0.000.00913.60.13%0.000.00
transactions 5.49 75.49
88
portfolio within
the
consolidation
scope1336 11958 1216 52948 10454 4249
Total 0795 —— 2261. —— 4972 7944.7 —— 1278. —— 4666
24.826763.152316.41
Provision for bad debts assessed individually: RMB 12637872.12 including significant impairment items
totaling RMB 11018413.04. The details are as follows:
Unit: RMB
Beginning balance Ending balance
Withdraw
Name ReasonCarrying Bad debt Carrying Bad debt al
for
amount provision amount provision proportio
withdraw
n
Difficult
Customer 1 2797123.26 2797123.26 2797123.26 2797123.26 100.00%
to recover
Difficult
Customer 2 2584805.83 2584805.83 2584805.83 2584805.83 100.00%
to recover
Difficult
Customer 3 1902326.58 1902326.58 1902326.58 1902326.58 100.00%
to recover
Difficult
Customer 4 1759397.30 1759397.30 1759397.30 1759397.30 100.00%
to recover
Difficult
Customer 5 1564000.07 1564000.07 1564000.07 1564000.07 100.00%
to recover
Difficult
Customer 6 1470110.64 1470110.64 0.00 0.00 ——
to recover
Difficult
Customer 7 410760.00 410760.00 410760.00 410760.00 100.00%
to recover
Total 12488523.68 12488523.68 11018413.04 11018413.04 -- --
For receivables within the portfolio the allowance for bad debts is recognized based on credit risk characteristics.Unit: RMB
Ending balance
Item
Carrying amount Bad debt provision Withdrawal proportion
Within 1 year 1224497546.06 24489950.93 2.00 %
1 to 2 years 8009829.79 400491.49 5.00 %
2 to 3 years 2139949.67 320992.45 15.00%
3 to 4 years 3555169.71 1066550.91 30.00%
4 to 5 years 4454600.04 2672760.02 60.00%
Over 5 years 77993643.75 77993643.75 100.00%
Total 1320650739.02 106944389.55
Please refer to the relevant information of disclosure of bad debt provision of other accounts receivable ifadopting the general mode of expected credit loss to withdraw bad debt provision of accounts receivable.□Applicable √Not applicable
(3) Bad Debt Provision Withdrawal Reversed or Recovered in the Current Period
Unit: RMB
Changes in the current period
Beginning
Category
balance Reversed or
Ending balance
Withdrawal Verification Others
recovered
Bad debt
provision
14107982.761470110.6412637872.12
accrued by
item
Withdrawal
of bad debt
90433295.5516511094.00106944389.55
provision by
group
Total 104541278.31 16511094.00 0.00 1470110.64 119582261.67
(4) Accounts Receivable Written-off in Current Period
Unit: RMB
Item Written-off amount
Accounts receivable with actual verification 1470110.64
Of which the verification of significant accounts receivable:
Unit: RMB
Name of the Nature of the Verification
Arising from
entity accounts Verified amount
Reason for
verification procedures
related-party
receivable performed transactions ornot
Court-Ordered
Accounts on the Minutes of the
Customer 1 receivable for 1470110.64 conclusion of Executive No
goods Bankruptcy Office
Liquidation
Total 1470110.64
(5) Top 5 of the Ending Balance of the Accounts Receivable and the Contract Assets Collected according to
Arrears Party
Unit: RMB
Name of the Ending balance Ending balance Ending balance Proportion to Ending balance
entity of accounts of contract of accounts total ending of bad debtreceivable assets receivable and balance of provision ofcontract assets accounts accounts
receivable and receivable and
contract assets impairment
provision for
contract assets
Customer 1 574387933.74 0.00 574387933.74 42.99% 11487758.68
Customer 2 245184220.00 0.00 245184220.00 18.35% 5172394.61
Customer 3 68402423.71 0.00 68402423.71 5.12% 1368048.47
Customer 4 48905454.18 0.00 48905454.18 3.66% 978109.09
Customer 5 44809044.30 0.00 44809044.30 3.35% 896180.89
Total 981689075.93 0.00 981689075.93 73.47% 19902491.74
2. Other Receivables
Unit: RMB
Item Ending balance Beginning balance
Interest receivable
Dividend receivable 5016960.00 7165080.00
Other receivables 18236989.64 17123687.65
Total 23253949.64 24288767.65
(1) Dividend receivable
Unit: RMB
Projects (or Investee Entities) Ending balance Beginning balance
Jiangsu Bank 5016960.00 7165080.00
Total 5016960.00 7165080.00
(2) Other Receivables
1) Other Receivables Classified by Accounts Nature
Unit: RMB
Nature Ending carrying value Beginning carrying value
Related-party transactions within
14568060.1631828957.95
the consolidation scope
Margin and cash pledge 1300.00 1300.00
Other entity current accounts 21584387.52 20438842.07
Petty cash and borrowings by
1127706.36763839.63
employeesOther 13782691.74 13697080.26
Total 51064145.78 66730019.91
2) Disclosure by Aging
Unit: RMB
Aging Ending carrying amount Beginning carrying amount
Within 1 year (including 1 year) 3065811.22 5982988.63
1 to 2 years 6115661.98 11494533.03
2 to 3 years 9364996.07 16754590.84
Over 3 years 32517676.51 32497907.41
3 to 4 years 291175.26 281647.36
4 to 5 years 40541.20 30300.00
Over 5 years 32185960.05 32185960.05
Total 51064145.78 66730019.91
3) Disclosure by Withdrawal Methods for Bad Debts
Provision for bad debts based on general model of expected credit losses
Unit: RMB
First stage Second stage Third stage
Expected loss in
Expected loss in
Bad debt provision Expected credit the duration the duration (credit Total
loss of the next 12 (credit
impairment
months impairment not
occurred)
occurred)
Balance of 1 January
38895.0844388.9849523048.2049606332.26
2025
Balance of 1 January
2025 in the Current —— —— —— ——
Period
--Transfer to Second
stage
-- Transfer to Third
stage
-- Reverse to Second
stage
-- Reverse to First stageWithdrawal of the
49781.8349781.83
Current Period
Reversal of the Current
16828957.9516828957.95
Period
Write-offs of the
Current Period
Verification of the
Current Period
Other changes
Balance of 30 June
88676.9144388.9832694090.2532827156.14
2025
The basis for the division of each stage and the withdrawal proportion of bad debt provision: None
Changes of carrying amount with significant amount changed of loss provision in the current period
□Applicable √Not applicable
4) Bad Debt Provision Withdrawn Reversed or Recovered in the Current Period
Withdrawal of bad debt provision:
Unit: RMB
Changes in the current period
Beginning
Category Charged
balance Reversed or
Ending balance
Withdrawal -off/Writ Others
recovered
ten-off
Bad debt provision
22444827.5016828957.955615869.55
separately accrued
Withdrawal of bad
debt provision by 27161504.76 49781.83 27211286.59
group
Total 49606332.26 49781.83 16828957.95 32827156.14
5）Write-off of Other Receivables During the Reporting Period: None
6) Top 5 of the Ending Balance of Other Receivables Collected according to the Arrears Party
Unit: RMB
Proportion to
total ending Ending balance
Name of the
Nature Ending balance Aging balance of of bad debt
entity
other provision
receivables %Changzhou Intercompany
Changniu Transactions with
15000000.00 1-3 years 29.37%
Machinery Consolidated
Co. Ltd. Entities
Changzhou
Intercompany
Compressor 2940000.00 Over 5 years 5.76% 2940000.00
funds
Factory
Changchai
Intercompany
Group Imp. & 2853188.02 Over 5 years 5.59% 2853188.02
funds
Exp. Co. Ltd.Changchai
Group Intercompany
1626483.25 Over 5 years 3.19% 1626483.25
Settlement funds
Center
Chuangye
Intercompany
Diesel Engine 1128676.16 Over 5 years 2.21% 1128676.16
funds
Repair Factory
Total 23548347.43 46.12% 8548347.43
3. Long-term Equity Investment
Unit: RMB
Ending balance Beginning balance
Item Carrying Depreciation Carrying Carrying Depreciation Carrying
amount reserves value amount reserves value
Investment to 868279449. 868279449. 875279449. 868279449.
0.007000000.00
subsidiaries 94 94 94 94
Investment to
joint ventures
and 44182.50 44182.50 44182.50 44182.50
associated
enterprises
868323632.868279449.875323632.868279449.
Total 44182.50 7044182.50
44944494
(1) Investment to Subsidiaries
Unit: RMB
Investee Beginning Beginnin Increase/decrease for the current period Ending Endingbalance g balance Withdra balance balance
(carrying of Addition wal of (carrying of
value) depreciat Reducedal impairm value) depreciat
ion investme Othersinvestme ent ion
reserve ntnt provisio reserve
n
Changchai
Wanzhou
51000005100000
Diesel
0.000.00
Engine Co.Ltd.Changzhou
Changchai
Benniu
96466509646650
Diesel
0.000.00
Engine
Fittings Co.Ltd.Changzhou
Horizon 4000000 4000000
Investment 0.00 0.00
Co. Ltd.Changzhou
Changchai
Horizon 700000 700000 700000
0.000.000.00
Agricultural 0.00 0.00 0.00
Equipment
Co. Ltd.Changzhou
Fuji
Changchai
47286234728623
Robin
0.030.03
Gasoline
Engine Co.Ltd.Jiangsu
Changchai 5918359 5918359
Machinery 19.91 19.91
Co. Ltd.Changzhou
Xingsheng
1000000.1000000.
Property
0000
Managemen
t Co. Ltd.Zhenjiang
Siyang
Diesel 4069080 4069080
Engine 0.00 0.00
Manufacturi
ng Co. Ltd.
86827947000007000007000008682794
Total 0.00
49.940.000.000.0049.94
(2) Investment to Joint Ventures and Associated Enterprises
Unit: RMB
Increase/decrease for the current period
Begi Begi Gains Endin
nning nning Ad and
Adjus Endin g
balan balan diti Red losses
tment Cash Withdr g balanof bonus
ce ce of ona uce recog other Chan or awal of
balan ce of
Investee (carr depre l d nized ges of impair
Ot ce depre
ying ciatio inv inve under
comp other profits ment her (Carr ciatio
value n est stm the
rehen
sive equity
announ provisi s ying n
reser me ent equity ced to) on value) reservve nt metho incom issue e
d e
I. Joint ventures
Subtotal 0.00 0.00 0.00 0.00
II. Associated enterprises
Beijing
Tsinghua
Xingye
Industrial
44184418
Investmen 0.00 0.00
2.502.50
t
Managem
ent Co.Ltd.
44184418
Subtotal 0.00 0.00
2.502.50
44184418
Total 0.00 0.00
2.50 2.50The recoverable amount is determined based on the net amount of the fair value minus disposal costs
□ Applicable √ Not applicable
The recoverable amount is determined by the present value of the forecasted future cash flow.□ Applicable √ Not applicable
The reason for the discrepancy between the foregoing information and the information used in the impairment
tests in prior years or external information: Not applicable
The reason for the discrepancy between the information used in the Company's impairment tests in prior years and
the actual situation of those years: Not applicable
4. Operating Revenue and Cost of Sales
Unit: RMB
Reporting Period Same period of last year
Item
Operating revenue Cost of sales Operating revenue Cost of sales
Main operations 1390026293.94 1240388539.57 1366413377.99 1162530395.97
Other operations 61686090.56 61737542.10 53682141.33 49682288.16
Total 1451712384.50 1302126081.67 1420095519.32 1212212684.13
Breakdown information of operating income and operating cost:
Unit: RMB
Category of Segment 1 Total
contracts Operating Revenue Operating cost Operating Revenue Operating cost
Business Type
Of which:
Single-cylinder
560494020.58516663643.98560494020.58516663643.98
diesel engines
Multi-cylinder
775603291.97675750680.27775603291.97675750680.27
diesel engines
Other products 28591316.59 25646410.98 28591316.59 25646410.98
Fittings 25337664.80 22327804.34 25337664.80 22327804.34
Classification by
operating region
Of which:
Sales in domestic
1193987469.511050466126.461193987469.511050466126.46
market
Export sales 196038824.43 189922413.11 196038824.43 189922413.11
Total 1390026293.94 1240388539.57 1390026293.94 1240388539.57
Information in relation to the transaction price apportioned to the residual contract performance obligation:The amount of revenue corresponding to performance obligations of contracts signed but not performed or not
fully performed yet was RMB0 at the period-end.
5. Investment Income
Unit: RMB
Item Reporting Period Same period of last year
Investment income from disposal of
held-for-trading financial assets 3198458.89 3180749.07
Dividend income from holding of other equity
instrument investment 5016960.00 10998000.00
Interest income from holding of debt obligation
investments 499852.62
Accounts receivable financing-discount interest of
bank acceptance bills 74524.00
Income from refinancing operations -1389349.23 -1300004.16
Total 6826069.66 13453121.53
XIX. Supplementary Materials
1. Items and Amounts of Non-recurring Profit or Loss
√Applicable □Not applicable
Unit: RMB
Item Amount Note
Gain or loss on disposal of non-current assets 2797353.31
Government grants recognized in current profit
or loss (excluding those closely related to the Excluding government grants related to
company’s normal business operations in assets transferred from deferred income
compliance with national policies granted 64535.00 amounting to RMB 1704864.73
based on predetermined standards and having individual income tax refunds of RMB
a sustained impact on the company’s profit or 53705.85 and job stabilization subsidies
loss). of RMB 21000.00.This was mainly due to the financial
Gains or losses from changes in fair value of investment income generated from the
financial assets and financial liabilities held by company's cash management during the
non-financial enterprises as well as gains or reporting period as well as the increase
losses from the disposal of financial assets and 18884092.44 in the fair value of shares held by the
financial liabilities (excluding effective wholly-owned subsidiary Horizon
hedging activities related to the company’s Investment in Jiangsu Liance
normal business operations). Electromechanical Technology Co. Ltd.and KaiLong High-Tech Co. Ltd.compared to the beginning of the period.Other non-operating income and expenses not
listed above. 113416.17
Less: Income tax effects 4733898.62
Non-controlling interests effects (after tax) 184.20
Total 17125314.10Others that meet the definition of non-recurring gain/loss:
□ Applicable √ Not applicable
No such cases in the Reporting Period.Explain the reasons if the Company classifies any extraordinary gain/loss item mentioned in the Explanatory
Announcement No.1 on Information Disclosure for Companies Offering Their Securities to the
Public—Non-recurring Gains and Losses as a recurrent gain/loss item
□ Applicable √ Not applicable
2. Return on Equity and Earnings Per Share
Weighted average ROE EPS (Yuan/share)
Profit as of Reporting Period
(%) EPS-basic EPS-diluted
Net profit attributable to ordinary
2.14%0.10400.1040
shareholders of the Company
Net profit attributable to ordinary
shareholders of the Company after
1.67%0.08110.0811
deduction of non-recurring profit
or loss
3. Differences between Accounting Data under Domestic and Overseas Accounting Standards
(1) Differences between Disclosed Net Profits and Net Assets in Financial Report in accordance with
International Accounting Standards and Chinese Accounting Standards
□ Applicable √ Not applicable
(2) Differences between Disclosed Net Profits and Net Assets in Financial Report in accordance with
Overseas Accounting Standards and Chinese Accounting Standards
□ Applicable √ Not applicable
(3) Explain Reasons for the Differences between Accounting Data Under Domestic and Overseas
Accounting Standards; for Any Adjustment Made to the Difference Existing in the Data Audited by the
Foreign Auditing Agent Such Foreign Auditing Agent's Name Shall Be Clearly Stated
□ Applicable √ Not applicable
The Board of Directors
Changchai Company Limited
20 August 2025
沪公网安备31011802005267号
