无锡威孚高科技集团股份有限公司
Weifu High-Technology Group Co. Ltd.
ANNUAL REPORT 2020
April 2021
Section I. Important Notice Contents and Interpretation
Board of Directors Supervisory Committee all directors supervisors and senior
executives of Weifu High-Technology Group Co. Ltd. (hereinafter referred to as
the Company) hereby confirm that there are no any fictitious statements
misleading statements or important omissions carried in this report and shall
take all responsibilities individual and/or joint for the reality accuracy and
completion of the whole contents.Wang Xiaodong Principal of the Company Ou Jianbin person in charger of
accounting works and Ou Jianbin person in charge of accounting organ
(accounting principal) hereby confirm that the Financial Report of 2020 Annual
Report is authentic accurate and complete.
All directors are attend the Meeting for the Report deliberation.
Concerning the forward-looking statements with future planning involved in the
Report they do not constitute a substantial commitment for investors. Investors
should be cautious with investment risks.
China's economy has entered a critical period of transformation and the main
theme is to reduce speed and improve quality. China's auto market has also
entered a period of transformation and adjustment. In a complex economic
environment weak consumption is still the main risk point that drags down the
auto market. Investors are advised to pay attention to investment risks.The profit distribution plan that deliberated and approved by the Board is:
based on total share capital of 1008894293 distributed 15 Yuan (tax included)
bonus in cash for every 10-share hold by all shareholders 0 share bonus issued
(tax included) and no public reserve transfer into share capital either.Contents
Section I Important Notice Contents and Interpretation .............................................................. 2
Section II Company Profile and Main Finnaical Indexes ............................................................ 5
Section III Summary of Business .................................................................................................. 10
Section IV Discussion and Analysis of Operation ....................................................................... 15
Section V Material Matters ............................................................................................................. 38
Section VI Changes in shares and particular about shareholders ............................................... 52
Section VII Preferred Stock……………………………………………………………………… 60
Section VIII Convertible Bonds .....................................................................................................61
Section IX Particulars about Directors SupervisorsSeniorExecutives and Employees........... 62
Section X Corporate Governance ................................................................................................... 73
Section XI Corporate Bond ............................................................................................................. 80
Section XII Financial Report .......................................................................................................... 81
Section XIII Documents Available for Reference ........................................................................ 253
Interpretation
Items Refers to Contents
Company The Company WFHT Refers to Weifu High-Technology Group Co. Ltd.
Weifu Group Refers to Wuxi Weifu Group Co. Ltd.Industry Group Refers to Wuxi Industry Development Group Co. Ltd.Robert Bosch Robert Bosch Company Refers to Robert Bosch Co. Ltd ROBERT BOSCH GMBH
Bosch Automobile Diesel Bosch Diesel System Refers to Bosch Automobile Diesel System Co. Ltd.
Weifu Leader Refers to Wuxi Weifu Leader Catalytic Converter Co. Ltd.Weifu Jinning Refers to Nanjing Weifu Jinning Co. Ltd.Weifu Tianli Refers to Ningbo Weifu Tianli Supercharging Technique Co. Ltd.Weifu Chang’an Refers to Wuxi Weifu Chang’an Co. Ltd.Weifu Mashan Refers to Weifu Mashan Pump Glib Co. Ltd.Weifu International Trade Refers to Wuxi Weifu International Trade Co. Ltd.Weifu Schmidt Refers to Wuxi Weifu Schmidt Power System Spare Parts Co. Ltd.Weifu Autocam Refers to Wuxi Weifu Autocam Fine Machinery Co. Ltd.Weifu Electric Drive Refers to Wuxi Weifu Electric Drive Technology Co. Ltd.
Autosmart Seating Refers to Wuxi Weifu Autosmart Seating System Co. Ltd.
SPV Refers to Weifu Holding ApS
IRD Refers to IRD Fuel Cells A/S
Borit Refers to Borit NV
Weifu Environment Refers to Wuxi Weifu Environment Catalyst Co. Ltd.Weifu Precision Machinery Refers to Weifu Precision Machinery Manufacturing Co. Ltd.Zhonglian Electronic Refers to Zhonglian Automobile Electronic Co. Ltd.Shinwell Automobile Refers to Shinwell Automobile Technology (Wuxi) Co. Ltd.
CSRC Refers to China Securities Regulatory Commission
SZSE Refers to Shenzhen Stock Exchange
Gongzheng Tianye Refers to
Gongzheng Tianye Certified Public Accountants (Special General
Partnership)
The reporting period Refers to From 1 Jan. 2020 to 31 Dec. 2020
Section II Company Profile and Main Financial Indexes
I. Company information
Short form of the stock WFHT Su Weifu-B Stock code 000581 200581
Stock exchange for listing Shenzhen Stock Exchange
Name of the Company (in Chinese) 无锡威孚高科技集团股份有限公司
Short form of the Company (in Chinese) 威孚高科
Foreign name of the Company (if applicable) WEIFU HIGH-TECHNOLOGY GROUP CO.LTD.
Short form of foreign name of the Company (if applicable) WFHT
Legal representative Wang Xiaodong
Registrations add. No.5 Huashan Road Xinwu District Wuxi
Code for registrations add 214028
Offices add. No.5 Huashan Road Xinwu District Wuxi
Codes for office add. 214028
Company’s Internet Web Site http://www.weifu.com.cn
E-mail Web @ weifu.com.cn
II. Person/Way to contact
Secretary of the Board Rep. of security affairs
Name Zhou Weixing Yan Guohong
Contact add. No.5 Huashan Road Xinwu District Wuxi No.5 Huashan Road Xinwu District Wuxi
Tel. 0510-80505999 0510-80505999
Fax. 0510-80505199 0510-80505199
E-mail wfjt@public1.wx.js.cn wfjt@public1.wx.js.cn
III. Information disclosure and preparation place
Newspaper appointed for information disclosure China Securities Journal; Securities Times; Hong Kong Commercial Daily
Website for annual report publish appointed by CSRC http://www.cninfo.com.cn
Preparation place for annual report Office of the Board of Directors
IV. Registration changes of the Company
Organization code 91320200250456967N
Changes of main business since
listing (if applicable)
No change
Previous changes for controlling
shareholders (if applicable)
Controlling shareholder of the Company was Weifu Group before 2009. and in 2009
controlling shareholder changed to Industry Group since 31 May 2009 due to the merged of
Industry Group and Weifu Group. Both Weifu Group and Industry Group were state-owned
companies of Wuxi State-owned Assets Supervision & Administration Commission therefore
actual controller of the Company turns to Wuxi State-owned Assets Supervision &
Administration Commission of State Council.
V. Other relevant information
CPA engaged by the Company
Name of CPA Gongzheng Tianye Certified Public Accountants (Special General Partnership)
Offices add. for CPA
10/F No.5 Building Jiakaicheng Fortune Center Jingrong 3rd Street Taihu Xincheng Binghu
District Wuxi Jiangsu Province
Signing Accountants Bai Lingjing Zhang Qianqian
Sponsor engaged by the Company for performing continuous supervision duties in reporting period
□ Applicable √ Not applicable
Financial consultant engaged by the Company for performing continuous supervision duties in reporting period
□ Applicable √ Not applicable
VI. Main accounting data and financial indexes
Whether the Company is required to retrospectively adjust or restate prior year’s accounting data
□ Yes √ No
2020 2019
Changes over last
year (+-)
2018
Operation revenue (RMB) 12883826306.60 8784356960.30 46.67% 8721674671.18
Net profit attributable to shareholders of the
listed company(RMB)
2772769377.96 2268026432.78 22.25% 2396077415.21
Net profit attributable to shareholders of the
listed company after deducting non-recurring
gains and losses(RMB)
2089986086.10 1947408959.68 7.32% 2014800714.20
Net cash flows arising from operating activities
(RMB)
781811234.01 1048670053.23 -25.45% 874381526.63
Basic earnings per share (RMB/Share) 2.79 2.25 24.00% 2.37
Diluted earnings per share (RMB/Share) 2.79 2.25 24.00% 2.37
Weighted average ROE 15.78% 13.77% 2.01% 15.48%
Year-end of 2020 Year-end of 2019
Changes over end
of last year (+-)
Year-end of 2018
Total assets (RMB) 27350695388.21 23958348185.78 14.16% 20892041460.30
Net assets attributable to shareholder of listed
company (RMB)
18282017990.66 16990405136.62 7.60% 15913828778.82
The lower of the company’s net profit before or after deduction of non-recurring profit (gain)/loss for the last three financial years is
negative and the audit report for the latest year indicates that there is uncertainty about the company’s ability to continue as a going
concern
□Yes √No
The lower of the net profit before or after deduction of non-recurring profit (gain)/loss is negative
□Yes √No
VII. Difference of the accounting data under accounting rules in and out of China
1. Difference of the net profit and net assets disclosed in financial report under both IAS (International
Accounting Standards) and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable √ Not applicable
The Company had no difference of the net profit or net assets disclosed in financial report under either IAS (International
Accounting Standards) or Chinese GAAP (Generally Accepted Accounting Principles) in the period.
2. Difference of the net profit and net assets disclosed in financial report under both foreign accounting
rules and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable √ Not applicable
The Company had no difference of the net profit or net assets disclosed in financial report under either foreign accounting rules or
Chinese GAAP (Generally Accepted Accounting Principles) in the period.
VIII. Quarterly main financial index
In RMB
Q 1 Q 2 Q 3 Q 4
Operation revenue 2772108717.43 3822294907.13 3324132346.07 2965290335.97
Net profit attributable to
shareholders of the listed company
549996717.72 776347707.26 903901365.25 542523587.73
Net profit attributable to
shareholders of the listed company
after deducting non-recurring gains
495225376.36 680349352.50 572795992.17 341615365.07
and losses
Net cash flows arising from
operating activities
319204809.86 118452262.55 624717046.92 -280562885.32
Whether there are significant differences between the above-mentioned financial index or its total number and the relevant financial
index disclosed in the company’s quarterly report and semi-annual report
□Yes √ No
IX. Items and amounts of extraordinary(non-recurring) profit (gains)/loss
√Applicable □ Not applicable
In RMB
Item 2020 2019 2018 Note
Gains/losses from the disposal of non-current asset (including the
write-off that accrued for impairment of assets)
10719959.77 28992604.71 96162222.57
Governmental subsidy reckoned into current gains/losses (not
including the subsidy enjoyed in quota or ration according to
national standards which are closely relevant to enterprise’s
business)
146475795.26 91170663.57 48811314.99
Fund possession fees reckoned in current gains/losses that
charged to non-financial enterprises
1608477.64
Profit and loss of assets delegation on others’ investment or
management
271684174.09 236832172.54 311261918.65
Gains/losses of fair value changes from holding the transaction
financial asset derivative financial assets transaction financial
liability and derivative financial liability and investment earnings
obtained from disposing the transaction financial asset derivative
financial assets transaction financial liability derivative financial
liability and other debt investment except for the effective
hedging business related to normal operation of the Company
375102546.00 24394637.95 16880487.62
Switch back of provision for depreciation of account receivable
and contractual assets which were singly taken depreciation test
3078424.43 1700000.00 466200.00
Other non-operating income and expenditure except for the
aforementioned items
-3090715.87 2183276.39 -597126.12
Other gain/loss qualify the definition of non-recurring
gains/losses
353111.39
Less: Impact on income tax 116175046.47 57345714.82 70234077.14
Impact on minority shareholders’ equity (post-tax) 5011845.35 8918644.88 21827350.95
Total 682783291.86 320617473.10 381276701.01 --
Concerning the extraordinary profit (gain)/loss defined by Q&A Announcement No.1 on Information Disclosure for Companies
Offering Their Securities to the Public --- Extraordinary Profit/loss and the items defined as recurring profit (gain)/loss according to
the lists of extraordinary profit (gain)/loss in Q&A Announcement No.1 on Information Disclosure for Companies Offering Their
Securities to the Public --- Extraordinary Profit/loss explain reasons
□ Applicable √ Not applicable
In reporting period the Company has no particular about items defined as recurring profit (gain)/loss according to the lists of
extraordinary profit (gain)/loss in Q&A Announcement No.1 on Information Disclosure for Companies Offering Their Securities to
the Public --- Extraordinary Profit/loss
Section III Summary of Business
I. Main businesses of the company in the reporting period
(i) Main business of the Company
According to the data released by China Association of Automobile Manufacturers: the production and sales
volume of automobiles for year of 2020 in the country amounted to 25.22 million and 25.31 million respectively
with 2% and 1.9% down from a year earlier respectively; of which the production and sales volume of passenger
vehicles were 19.99 million and 20.18 million respectively with 6.5% and 6% declined over same period of last
year respectively. In 2020 driven by the elimination of National III vehicles the tightening of
overload/over-speed and infrastructure investment the annual production and sales of commercial vehicles
showed significant growth. The production and sales volume of commercial vehicles in 2020 were respectively
amounted as 5.23 million and 5.13 million exceeding 5 million for the first time and reaching a record high. The
production and sales of commercial vehicle increasing by 20.0% and 18.7% on a y-o-y basis respectively.
During the reporting period the company's main business was the production and sales of automobile components.
The main products included diesel fuel management system products after-treatment system products and air
management system products. Since the beginning of the year the company has actively seized market
opportunities seized key products and key customers and achieved a steady increase in market share. The
business of the three major systems has grown rapidly and achieved the company's goal of over tens of billions of
operating income.Main uses of the Company's products:
1.The fuel management system products are widely used in different power diesel engines supporting all types of
trucks passenger cars buses construction machinery marine and generator sets. The company not only makes
products matching with the main engines used at home but also exports some products to the Americas Southeast
Asia and the Middle East. Products can meet the national emission regulation standards.
2.After-treatment system productswhich mainly support the major manufacturers of automobile motorcycle and
general machinery at home and meet the national emission standards.
3.Air management system products (supercharger)matches with most of the domestic small-bore diesel engine
plants and some 6-cyl diesel engine manufacturers and meet the needs of the light and heavy commercial vehicles
some passenger cars and engineering machinery. Products can meet the national emission regulation standards.
4. Key parts of the fuel cell including membrane electrodes graphite bipolar plates metal bipolar plates and BOP
key components for domestic and foreign fuel cell reactor and system manufacturers.(ii) During the reporting period development stage and periodical characteristics of the industry to which
the company belongs as well as the company’s position in the industry
2021 is the first year for the development of the "14
th
Five-Year Plan" and is also the year to embark on a new
journey of building a socialist modern country in an all-round way and march towards the second centenary goal.It is a milestone in our country's development process. As the epidemic prevention and control becomes normal
the economy as a whole will maintain growth under the influence of a low base and recovery resonance. Standing
at the historical intersection of the "two centenary" goals the auto industry will fully enter a new stage of
transformation and upgrading with high-quality development. The new development pattern which is dominated
by the domestic large-scale cycle and the mutual promotion of the international and domestic double cycles has
given China's auto industry more significant responsibilities. During the "14
th
Five-Year Plan" period our
country's auto industry will maintain a steady development trend. From the perspective of the development
situation promoting automobile consumption is the main task of stabilizing growth and expanding domestic
demand; enhancing the independent controllability of the supply chain of the industrial chain is the main means to
achieve high-quality industrial development; the upgrading of emission regulations and the new dual-slope policy
are compelling companies to carry out more stringent reforms to reduce consumption and emissions; carbon
peaking and carbon neutrality promote the further development of new energy vehicles; intelligent networking
rapid penetration of ADAS and smart cockpits and 5G promote the development of the Internet of Vehicles. In the
new round of technological revolution and industrial transformation the company will respond to industry
challenges with a positive attitude seize industry development opportunities and strive to jointly create a better
tomorrow for the auto industry.
After more than 60 years of hard work the company has become a backbone enterprise of key parts of domestic
auto 80% products of the existing Automobile components core business are matched with the electronic control
systems and electronically controlled. The company will actively respond to the national new energy and
intelligent network strategy take the Automobile components industry chain as the core and other related fields as
supplements lay out new energy auto drive technology and promote the hydrogen fuel cell technology and
intelligent network technology research and development capacity building. Market objectives: consolidate the
existing business market position and take a position in the new business potential market. Technical objectives:
strengthen the technical strength of the pillar business lay out the new business frontier technology and actively
expand new areas based on the existing business. Strive to achieve the goal of becoming a leader in the auto core
parts enterprises.II. Major changes in main assets
1. Major changes in main assets
Major assets Cause of major changes
Equity assets No major change
Fixed assets No major change
Intangible assets No major change
Construction in progress No major change
Other non-current financial assets
Other non-current financial assets at period-end has major changes over that of
year-begin mainly because the number of financial products held for more than one year
increased.Goodwill
Goodwill at period-end has major changes over that of year-begin mainly because the
Company acquired 100% equity of Borit by way of equity acquisition in cash in the
Period cost of consolidation is greater than the fair value of the identifiable net assets of
Borit’s
2. Main overseas assets
√Applicable □ Not applicable
Specific
content of
the asset
Cause of
formation
Asset size Location
Operation
model
Control measures to
guarantee asset security
Inco
me
status
The proportion
of overseas
assets in the
company’s net
assets
Whether
there are
significant
risks of
impairment
(Y/N)
IRD Fuel
Cells A/S
Enterprise
combine
under the
different
control
RMB
64.9628
million
Denmark
Wholly-owne
d subsidiary of
the company
R&D
production
and sale of the
fuel cell
component
products
The Company will pay full
attention to the changes in
the industry and markets
strengthen corporate
governance personnel
management financial
management audit
supervision and
performance assessment
N/A 0.36% N
Borit NV
Enterprise
combine
under the
different
control
RMB
114.6663
million
Belgium
Wholly-owne
d subsidiary of
the company
production
and sale of the
The Company will pay full
attention to the changes in
the industry and markets
strengthen corporate
governance personnel
N/A 0.63% N
fuel cell
component
products
management financial
management audit
supervision and
performance assessment
III. Core Competitiveness Analysis
1. Technology and product advantages. The company is a national high-tech enterprise. It has scientific research
platforms such as "National Enterprise Technology Center" "National High-tech Research and Development Plan
Achievement Industrialization Base" "Post-Doctoral Scientific Research Workstation" and "Jiangsu Postgraduate
Workstation". Its subsidiaries have established a number of provincial-level engineering and technological
research centers provincial-level engineering laboratories and other research and development institutions
mainly focus on fuel injection systems exhaust after-treatment systems and air management systems to conduct
technical research and product development. At present the company has mastered a number of core patented
technologies the main product technical indicators are at the leading level in the industry and have strong market
competitiveness. In recent years the company has made arrangements in the fields of new energy and intelligent
network technology and strengthened the development of new business research and development capabilities.The company’s technology center has established a new energy and network technology research institute built a
new energy core component test center and initially achieved the research and development capabilities for the
core parts and components of hydrogen fuel cell and intelligent network technology products.
2. Industry and brand advantages. After more than 60 years of development the company has become a
well-known enterprise in the domestic automobile components industry and has established long-term and stable
supporting relationships with major domestic OEMs. 80% of the existing automobile components core business
products are matched with electronic control systems and realize electronic control and take a leading position
among independent brands. The company is a pioneer in China's internal combustion engine industry and one of
China's top 100 automobile components companies.
3. Advantages in marketing and service. The company has a stable professional and experienced marketing team
that can provide targeted support and services according to customer needs and customer relationships are
harmonious. For long-term strategic customers the company has established a four-in-one marketing
collaboration organization composed of leaders key account managers marketing departments and business
departments. The company’s management exchanges regular visits to promote exchanges and cooperation. Over
the years the company has won many honors such as "Excellent Quality Award" "Excellent Supplier"
"Outstanding Supplier" and "Win-Win Cooperation Award" awarded by customers with its stable product quality
and timely delivery. The company has a relatively complete after-sales service system and has built after-sales
service networks intelligent service platforms and has established special maintenance technical service stations
across the country to regularly conduct maintenance and fault analysis and judgment training for end users which
can provide customers with fast timely and professional all-round after-sales services.
4.Management and manufacturing advantages. The company has a complete organizational structure continues to
optimize management systems and processes and has built five major information systems such as financial
sharing platforms and IOS & Android applications to realize the effective migration and stable operation of
organization and personnel business and accounting. The company has established human resources information
system platforms and realized the timely and accurate standardization of basic data of organization personnel
salary and attendance; the procurement sharing system has opened the information interconnection between the
enterprises and the suppliers and realized the closed-loop management to the procurement requirements sourcing
supplier management and payment settlement process. The company fully implements the Weifu Production
System (WPS) with lean concepts and promotes continuous improvement of the system and the workshop which
effectively improves production efficiency and reduces manufacturing costs. The company has built a quality
management system for the whole process and guaranteed the product quality level through a transparent
intelligent and lean quality control platform. The company focuses on intelligent manufacturing continues to
build intelligent factories with Weifu characteristics builds MES ERP data center cloud platform SRM and
other systems and promotes the application of cloud computing and 5G networks which will strongly support
future business development needs.
5. Talent advantage. The company's management team has extensive experience and a good industry reputation in
the Automobile components industry. The company pays attention to the growth of employees and the
construction of a core talent team. After years of accumulation it has accumulated a group of professional and
high-quality management and technical personnel established a reasonable talent echelon and provided strong
manpower resource guarantee for the company's long-term and stable development. The company's human
resource management system is relatively complete focusing on strategy business and employees and
continuously optimizing various human resource management systems to provide a fair value realization platform
for employees' career development. The company pays attention to the service and care of employees improves
the service experience of employees in a mobile intelligent and self-service way through the establishment of
employee self-service platformand creates a working environment with warmth and sense of belonging.Section IV Discussion and Analysis of the Operation
I. Introduction
(i) Overall situation
Since the beginning of the year the market environment has been complex and changeable. In the face of the
severe challenges brought by the epidemic the government quickly introduced a series of policy measures to deal
with the epidemic and promote the resumption of work and production so that the macro economy has shown a
rapid recovery after the COVID-19 epidemic was effectively controlled realizing the economy from falling to
rising maintaining the overall economic and social stability. The performance of the automobile industry was
much better than expected. Although the production and sales of the whole year were stable and slightly decreased
the overall performance presented strong development resilience and driving force.According to the data released
by China Association of Automobile Manufacturers: the production and sales volume of automobiles for the
whole year amounted to 25.22 million and 25.31 million respectively with 2% and 1.9% down from a year earlier
respectively; of which the production and sales volume of passenger vehicles were 19.99 million and 20.18
million respectively with 6.5% and 6% declined over same period of last year respectively the production and
sales volume of commercial vehicles were respectively amounted as 5.23 million and 5.13 million a y-o-y growth
of 20.0% and 18.7% respectively.
Facing the complex and changeable external environment the company’s board of directors actively responded to
the national epidemic prevention requirements actively did a good job in the epidemic prevention and control and
the resumption of work and production had the courage to fulfill social responsibilities seized the policy
opportunities of national economic recovery and concentrated on forging ahead in concert the company
outperformed the annual various operating performance indicators established at the beginning of the year.During
the reporting period operating revenue achieved 12.884 billion Yuan with 46.67% up on a y-o-y basis; total profit
amounted to 3.003 billion Yuan with 22.54% increase on a y-o-y basis; total assets of the Company was
27.351billion Yuan with 14.16% up from a year earlier; and the owners interest attributable to parent company
was 18.282 billion Yuan a y-o-y growth of 7.60% achieved.(ii) Main work carried out
1. Seize market opportunities and achieve a new breakthrough in operating income of tens of billion yuan.
Since the beginning of the year the company actively responds to the complex market environment seized
opportunities seized key products and key customers and achieved a steady increase in market share. The three
major system businesses grew rapidly achieving the company's goal of over tens of billion yuan in revenue from
its main business. Fuel management system business achieved annual sales of 2.1 million sets of common rail
pumps hitting a record high; VE distribution pumps increased their share in the off-road market with sales
exceeding 350000 sets an increase of nearly 20% on a year-on-year basis; in terms of after-treatment system
business gasoline purifiers achieved annual sales volume exceeding 2 million sets diesel purifiers achieved
annual sales volume exceeding 500000 sets both year-on-year increase of over 50%. The overall market share of
passenger vehicles continued to rise. The commercial vehicle market was actively expanding its core customers'
National VI projects. In the off-road market a customer base for key projects has been established. In terms of air
management system business the four-cylinder turbocharger has been deployed in the gasoline engine market to
acquire key project customer groups. The company has maintained a leading position in the diesel engine market
share. Sales volume of six-cylinder turbochargers increase of over 50%，and it successfully acquired importantcustomers in the National-VI projects. Meanwhile，the company's manufacturing capabilities for precisionmanufacturing and parts processing have been rapidly improved.
2. Intensify technological research and development and promote the development of new
products.Continued to tap the technical potential of fuel injection system products and expand key customer
project products. The company has gradually achieved mass production in major customer projects for gasoline
turbocharger products six-cylinder turbochargers have won a full range of natural gas projects from important
customers four-cylinder gasoline turbocharger passenger car projects have successively obtained new
National-VI B projects and four-cylinder diesel turbocharger successfully obtained National-VI projects in key
markets. The company has completed the packaging development of the National-VI GPF catalyst products of
core customers on passenger vehicles for exhaust after-treatment system products and realized mass supply. The
WSP2.0 packaging platform is being developed on commercial vehicles and each stage of the test has been
completed on schedule; completed the design trial production and testing of functional samples of core
components for new energy products and mastered the basic research and development capabilities. In terms of
hydrogen fuel cell products the company has completed the fully independent development of core materials for
the fuel cell core materials from catalyst gas diffusion layer (GDL) to membrane electrode (MEA); completed the
full water-based ink formulation optimization and catalyst layer leveling optimization of catalyst coating
membrane (CCM) and the performance is greatly improved. For extended field products the first smart seat has
left the production line and commercial vehicle seats have officially started mass production.
3. Layout new business in an orderly manner. Continued to promote the strategic planning of fuel cells and
core components of the intelligent network newly increased and defined planning for key strategic products such
as metal bipolar plates auxiliary components (BOP) situational awareness systems automotive smart seats.
Focused on the two major fields of hydrogen fuel cell and intelligent network connection for new business layout.
The company has continued to increase the layout and investment of hydrogen fuel cells acquired 100% equity of
Belgian Borit Company and focused on developing IRD's business in the Chinese market and accelerated the
construction of the core competitiveness of bipolar plates with dual technology routes (metal graphite). In the
field of intelligent network connection the environmental situation awareness system has won a number of
customer projects and the current focus is on intelligent security and industrial intelligent manufacturing to
actively carry out product development manufacturing and market capacity building. The company has
completed the establishment of a joint venture of Weifu Autosmart Seating System Co. Ltd. (WFAS) and started
operations.
4. Continuously improve operation and management capabilities. Information construction: the company
continued to promote projects such as intelligent manufacturing supply chain collaboration and process
management through information technology’s strong supports to the optimization and upgrading of the
company's management level. Completed the high-level planning and design of the supply chain data collection
and preliminary analysis; completed the construction of the Aris process management platform and the unified
process management portal which provided a guarantee for the efficient operation of the long-term mechanism of
the process management system. Steadily advanced the company's information security work. Compliance
management: the company made plans for the overall construction of the company's risk management system so
as to create three lines of defense for risk control with the goal of "essential compliance". Built a risk database for
the company’s people finance property and engineering pilot domains and integrated risk management and
internal control elements into the business process design. Controlled the legal compliance risks in the company's
various investments and other major projects.Manufacturing quality: continuously improved the company's
quality system management platform including special process audits cross-divisional cross-quantitative audits
professional auditor echelon construction and quality system group certification etc. continued to improve
product projects promoted intelligent manufacturing projects and realized equipment information management;
Comprehensively promoted the manufacturing informatization and completed the on-line of multiple functional
modules; realized the comprehensive informatization management of the production process. Financial
management: strengthened internal business collaboration and optimized related transaction business processes.Strictly controlled slow-moving inventory and accounts receivable beyond credit period.Purchasing and logistics:
completed the second phase construction of the company's procurement sharing system established and
implemented the indirect material category management processes to achieve cost control goals; completed the
planning and promotion plan of the organizational structure based on "category management" and immediately
started organizational optimization work. Carried out the logistics informatization and automation pilot work
started the overall planning project of the supply chain completed the status survey and high-level design work.Human resources: continued to promote the strategic planning of human resources and comprehensively analyzed
the future development direction of the management mechanism and the talent team. Starting from the
competency model and actual business needs strengthened team building planned and carried out special training
and improved work efficiency; in order to fully mobilize the enthusiasm sense of responsibility and mission of
the company’s senior management and core personnel paid attention to the interests of all shareholders and the
company’s long-term development and the preservation and appreciation of state-owned assets launched the
company's 2020 restricted stock incentive plan and the first grant was completed at the end of the year.(iii) Company business model
The company has followed the business philosophy of making quality products creating famous brands striving
for first choice and creating value for users and implemented the business model of unified management of the
parent company and decentralized production of subsidiaries. That is the group company is responsible for
formulating strategic development plans and business objectives and carries out unified management guidance
and assessment of subsidiaries in terms of finance major personnel management core raw materials quality
control and technology. Subsidiaries arrange production according to the market order management model so
that the subsidiaries maintain the same quality as the company's products and at the same time help to understand
customer needs in a timely manner and save logistics costs maintain the timeliness of product production and
supply and improve the company's economic benefits.There were no significant changes in the company’s main business and business model during the reporting period
Complete vehicle manufacturing production and operation during the reporting period
□Applicable √Not applicable
Production and operation of the auto components during the reporting period
√Applicable □ Not applicable
Unit: In 10 thousand pieces
Output Sales volume
Current
Period
Same period
last year
Year-over-year
increase/decrease
Current
Period
Same period
last year
Year-over-year
increase/decrease
According to components
Fuel management system-
multi-cylinder pumps
277 226 22.57% 256.8 218.4 17.58%
Fuel management system-
fuel injector
253.7 236.14 7.44% 242.8 234.34 3.61%
After-treatment system -
purifier
34 32 6.25% 33 29 14.00%
Air management system
-turbocharger
88.2 70.4 25.28% 84 67.7 24.08%
According to complete vehicle packages
After-treatment system -
purifier
303 161 88.20% 296 155 91.00%
According to after-sale market
Fuel management system-
multi-cylinder pumps
2 4 -50.00% 2.2 4.6 -52.17%
Fuel management system-
fuel injector
1.3 0.86 51.16% 1.2 0.66 81.82%
Air management system-
turbocharger
1.8 1.6 12.50% 2 2.3 -13.04%
According to region
In China
Fuel management system-
multi-cylinder pumps
279 230 21.30% 259 223 16.14%
Fuel management system-
fuel injector
255 237 7.59% 244 235 3.83%
After-treatment system -
purifier
337 193 74.61% 329 184 78.80%
Air management system-
turbocharger
90 72 25.00% 86 70 22.86%
Explanation of reasons for more than 30% changes on a y-o-y basis
√ Applicable □ Not applicable
Increasing market demand for after-treatment system products in 2020
Parts sales model
Over the years the company has adhered to customer-centric idea using flexible marketing strategies and
standardized development procedures to meet the needs of different types of customers so as to ensure the smooth
progress of customer development plans and strive for more customers and larger market shares. The company
has established a mechanism for mutual visits to strategic customers. The company's senior executives regularly
visit customers or receive customer visits hold high-level strategic meetings special cooperation and exchanges
and other activities. Implement special management to the company's strategic customers establish a four-in-one
collaborative organization composed of company leaders key account managers marketing departments and
business departments and do a good job in customer demand analysis and management customer satisfaction
survey analysis etc. At the same time the company optimizes business processes through information technology
means to increase the speed of response to customer needs and assists customer relationship management through
modern technical tools such as call centers customer data warehouses business intelligence mobile devices and
web conferences. The company promotes the collaborative marketing of existing and new businesses strengthens
exchanges and cooperation with existing business customers in new businesses and actively expands new
customers and develops potential customers.The Company carries out auto finance business
□ Applicable √ Not applicable
The Company carries out related business of new-energy vehicles
√ Applicable □ Not applicable
Production and operation of the complete and parts of new-energy vehicles
In RMB
Category Capacity status Output Sales volume Sales revenue
Fuel cell components 1500000 pieces 700000 pieces 600000 pieces 77397000.00
II. Main business analysis
1. Introduction
See the “I-Introduction” in “Discussion and Analysis of the Operation”
2. Revenue and cost
(1) Constitute of operation revenue
In RMB
2020 2019
Increase/decrease
y-o-y (+-)
Amount
Ratio in
operation
revenue
Amount
Ratio in
operation
revenue
Total operation revenue 12883826306.60 100% 8784356960.30 100% 46.67%
According to industries
Automobile components 12430431489.90 96.48% 8354743964.67 95.11% 48.78%
Other business 453394816.70 3.52% 429612995.63 4.89% 5.54%
According to products
Fuel management system 5365576457.96 41.65% 4872783878.47 55.47% 10.11%
After-treatment system 6408508512.76 49.74% 3036081382.54 34.56% 111.08%
Air management system 656346519.18 5.09% 445878703.66 5.08% 47.20%
Other business 453394816.70 3.52% 429612995.63 4.89% 5.54%
According to region
Domestic sales 12670892115.47 98.35% 8488435602.48 96.63% 49.27%
Foreign sales 212934191.13 1.65% 295921357.82 3.37% -28.04%
(2) The industries products or regions accounting for over 10% of the company’s operating revenue or
operating profit
√ Applicable □ Not applicable
In RMB
Operating revenue Operating cost
Gross profit
ratio
Increase/dec
rease of
operating
revenue
y-o-y
Increase/dec
rease of
operating
cost y-o-y
Increase/decr
ease of gross
profit ratio
y-o-y
According to industries
Automobile components 12430431489.90 10124574480.95 18.55% 48.78% 60.13% -5.77%
According to products
Fuel management system 5365576457.96 3962691866.03 26.15% 10.11% 16.64% -4.13%
After-treatment system 6408508512.76 5748550167.21 10.30% 111.08% 120.98% -4.02%
Air management system 656346519.18 413332447.71 37.03% 47.20% 27.52% 9.73%
According to region
Domestic sales 12217497298.77 9924244563.88 18.77% 51.60% 64.28% -6.27%
Foreign sales 212934191.13 200329917.07 5.92% -28.04% -28.88% 1.11%
Under circumstances of adjustment in reporting period for statistic scope of main business data adjusted main business based on
latest one year’s scope of period-end
□ Applicable √ Not applicable
(3) Whether the company’s revenue from physical sales is greater than its revenue from labor services
√ Yes □ No
Industries Item Unit 2020 2019
Increase/decrease
y-o-y (+-)
Fuel management system-
multi-cylinder pumps
Sales volume In 10 thousand units 259 223 16.14%
Output In 10 thousand units 279 230 21.30%
Storage In 10 thousand units 44 24 83.33%
Fuel management system-
fuel injector
Sales volume In 10 thousand sets 244 235 3.83%
Output In 10 thousand sets 255 237 7.59%
Storage In 10 thousand sets 25 14 78.57%
After-treatment system -
purifier
Sales volume In 10 thousand pieces 329 184 78.80%
Output In 10 thousand pieces 337 193 74.61%
Storage In 10 thousand pieces 45 37 21.62%
Air management
system—turbocharger
Sales volume In 10 thousand units 86 70 22.86%
Output In 10 thousand units 90 72 25.00%
Storage In 10 thousand units 20 16 25.00%
Reasons for y-o-y relevant data with over 30% changes
√ Applicable □ Not applicable
Increasing market demand for after-treatment system products in 2020
End of 2020 the y-o-y increase in inventory of fuel management system products is due to the spread of
COVID-19 in first quarter of 2021 in China and uncertainty of global COVID-19 the company initiative to
increase inventory in response to the impact of supply chain fluctuations.(4) Performance of significant sales contracts entered into by the company up to the current reporting
period
□ Applicable √ Not applicable
(5) Constitute of operation cost
Classification of industries and products
In RMB
Industries Item
2020 2019
Increase/decrease
y-o-y (+-) Amount
Ratio in
operation cost
Amount
Ratio in
operation
cost
Automobile components Direct material 8569425665.05 84.64% 5073943822.40 80.25% 68.89%
Automobile components Labor cost 698928471.64 6.90% 604002205.22 9.55% 15.72%
Automobile components Depreciation 248063547.16 2.45% 201984066.69 3.20% 22.81%
Automobile components
Varieties of
consumption
608156797.10 6.01% 442880613.36 7.00% 37.32%
In RMB
Products Item
2020 2019
Increase/decrease
y-o-y (+-) Amount
Ratio in
operation cost
Amount
Ratio in
operation
cost
Fuel management system Direct material 2715216192.48 68.52% 2341746790.78 68.93% 15.95%
Fuel management system Labor cost 566823619.35 14.30% 486814730.66 14.33% 16.44%
Fuel management system Depreciation 192635987.10 4.86% 159352538.54 4.69% 20.89%
Fuel management system
Varieties of
consumption
488016067.10 12.32% 409342635.04 12.05% 19.22%
After-treatment system Direct material 5500221875.04 95.68% 2455083907.97 94.38% 124.03%
After-treatment system Labor cost 104394069.57 1.82% 98440253.86 3.78% 6.05%
After-treatment system Depreciation 35518676.76 0.62% 24461602.33 0.94% 45.20%
After-treatment system
Varieties of
consumption
108415545.84 1.88% 23428346.36 0.90% 362.75%
Air management system Direct material 353987597.53 85.64% 277113123.65 85.49% 27.74%
Air management system Labor cost 27710782.72 6.70% 18747220.70 5.78% 47.81%
Air management system Depreciation 19908883.30 4.82% 18169925.82 5.61% 9.57%
Air management system
Varieties of
consumption
11725184.16 2.84% 10109631.96 3.12% 15.98%
Note
The direct material from after-treatment system has significant increase on a y-o-y basis mainly due to the significant increase in
precious metal prices.
(6) Whether there was a change in the scope of consolidation during the reporting period
√Yes □No
Changes of
consolidate
scope
Enterprise Equity obtained method
Contribution
ratio
Consolidate
scope increased
Borit NV A wholly-owned subsidiary purchased in cash during the period through SPV 100.00%
Consolidate
scope increased
Autosmart Seating
The enterprise jointly invested by controlling subsidiary of the Company -
Weifu Leader and Qiqiong Automobile Technology (Shanghai) Co. Ltd.
66%
(7) Major changes or adjustment in business product or service of the Company in Reporting Period
□ Applicable √ Not applicable
(8) Major sales and main suppliers
Major sales clients of the Company
Total top five clients in sales (RMB) 6700363928.17
Proportion in total annual sales volume for top five clients 52.01%
Ratio of the related party sales in total annual sales from top five clients 29.67%
Information of top five clients of the Company
Serial Name Sales (RMB) Proportion in total annual sales
1 Bosch Diesel System 2961684269.09 22.99%
2 Client 1 1776938391.50 13.79%
3 Robert Bosch 860611502.90 6.68%
4 Client 2 604223164.56 4.69%
5 Client 3 496906600.12 3.86%
Total -- 6700363928.17 52.01%
Other situation of main clients
√ Applicable □ Not applicable
The Company has association with Bosch Diesel System and Robert Bosch.In addition the directors supervisors
senior executives core technicians and actual controller of the Company have no equity in main suppliers directly
or indirectly.Main suppliers of the Company
Total purchase amount from top five suppliers (RMB) 4502021760.55
Proportion in total annual purchase amount for top five suppliers 39.48%
Ratio of the related party purchase in total annual purchase amount from top five suppliers 28.93%
Information of top five suppliers of the Company
Serial Suppliers Purchasing amount (RMB) Ratio in annual total purchasing amount
1 Weifu Environment 3051513211.66 26.76%
2 Supplier 1 563585531.94 4.94%
3 Supplier 2 494641533.98 4.34%
4 Supplier 3 213197050.95 1.87%
5 Supplier 4 179084432.02 1.57%
Total -- 4502021760.55 39.48%
Other notes of main suppliers of the Company
√ Applicable □ Not applicable
The Company has association with Weifu Environment.In addition the directors supervisors senior executives
core technicians and actual controller of the Company have no equity in main suppliers directly or indirectly.
3. Expenses
In RMB
2020 2019
Increase/decrease
y-o-y (+-)
Note of major changes
Sales expenses 406353445.10 259650752.33 56.50% Accrual-warranty expenses
Administration expenses 782824422.63 514028451.76 52.29% Accrual of incentive funds
Financial expenses -23278301.84 -57892276.12
R&D expenses 532581209.78 417924908.28 27.43%
4. R&D investment
√ Applicable □ Not applicable
During the reporting period the Company focused on the development strategy of the enterpriseaccelerated the
research and development of key products put forth effort to improve the industrialization of new products and
enhanced new power for the enterprises development.The traditional energy products are mainly internal
combustion engine power engineering which meet the requirements of energy saving and emission reduction; with
continuous improvement of product performance continue to maintain the leading position in the industry.At the
same time the company carried out layouts in new energy intelligent network technology and other fields through
its own research and development acquisitions and mergers promoted the research and development and capacity
building of core technology and intelligent network technology of hydrogen automobile components to ensure the
company’s leading position in the future Automobile components industry. In 2020 total R&D expenditure has
533 million Yuan accounting for 2.91% of the net assets and 4.13% of the operating revenue.
R&D investment of the Company
2020 2019 Change ratio (+-)
Number of R&D (people) 1094 1020 7.25%
Ratio of number of R&D 20.30% 18.75% 1.55%
R&D investment (RMB) 532581209.78 417924908.28 27.43%
R&D investment accounted for R&D income 4.13% 4.76% -0.63%
R&D investment capitalization (RMB) 0.00 0.00 0.00%
Capitalization R&D investment accounted for R&D
investment
0.00% 0.00% 0.00%
The reason of great changes in the proportion of total R&D investment accounted for operation income than last year
□ Applicable √ Not applicable
Reason for the great change in R&D investment capitalization rate and rational description
□ Applicable √ Not applicable
5. Cash flow
In RMB
Item 2020 2019
Increase/decrease
y-o-y (+-)
Subtotal of cash inflow arising from operating activities 12043108885.31 8341575856.11 44.37%
Subtotal of cash outflow arising from operating activities 11261297651.30 7292905802.88 54.41%
Net cash flows arising from operating activities 781811234.01 1048670053.23 -25.45%
Subtotal of cash inflow from investing activities 10622042577.88 12833209781.87 -17.23%
Subtotal of cash outflow from investing activities 10050595606.37 14048725074.34 -28.46%
Net cash flows arising from investing activities 571446971.51 -1215515292.47
Subtotal of cash inflow from financing activities 714062395.41 824385498.20 -13.38%
Subtotal of cash outflow from financing activities 1940870096.67 2246745266.02 -13.61%
Net cash flows arising from financing activities -1226807701.26 -1422359767.82
Net increase of cash and cash equivalents 124447364.85 -1584175485.64
Main reasons for y-o-y major changes in aspect of relevant data
√ Applicable □ Not applicable
The y-o-y increase in cash inflow arising from operating activities was mainly due to the significant increase in
operating revenue from a year earlier and the cash received from the sale of goods and provision of services
increased significantly on a y-o-y basis;
The y-o-y increase in cash outflow arising from operating activities was mainly due to the increase in cash paid
for purchasing goods and accepting labor services;
The y-o-y increase in net cash flows arising from investing activities was mainly due to the cash received from
investment earnings increased from a year earlier and the cash paid for investment declined on a y-o-y basis.Reasons of major difference between the cash flow of operation activity in report period and net profit of the Company
√ Applicable □ Not applicable
Mainly due to the investment earnings and specific influencing factors found more in supplementary information of cash flow
statement carried in Annotation of the Report.III. Analysis of the non-main business
√ Applicable □ Not applicable
In RMB
Amount
Ratio in total
profit
Cause description Whether be sustainable
Investment earnings 1964805688.57 65.43%
Earnings mainly form the two
joint ventures (Bosch
Automobile Diesel and
Zhonglian Electronic) with
stock participated by the
Company
The joint ventures Bosch Automobile
Diesel and Zhonglian Electronic
have stable production and
operation so the investment returns
can be sustained and stable
Gain/loss of fair
value changes
383325765.19 12.76%
Asset impairment -178837472.85 -5.96%
Non-operating
income
66467021.62 2.21%
Non-operating
expense
4158888.17 0.14%
IV. Assets and liability
1. Major changes of assets composition
Newrevenue standards or new leasing standards implemented by the Company at first time since 2020 and adjusted relevant items of
the financial statement on beginning of the year when implemented the Standards
Applicable
In RMB
Year-end of 2020 Year-begin of 2020 Ratio
changes
(+-)
Note of major
changes Amount
Ratio in
total assets
Amount
Ratio in
total assets
Monetary funds 1963289832.33 7.18% 1596893711.87 6.63% 0.55%
Account receivable 2824780352.41 10.33% 2425681942.29 10.08% 0.25%
Inventory 2877182174.64 10.52% 2418744835.82 10.05% 0.47%
Investment real estate 20886681.62 0.08% 22410511.87 0.09% -0.01%
Long-term equity
investment
4801488290.97 17.56% 5322405953.35 22.11% -4.55%
Fixed assets 2882230191.08 10.54% 2845176078.20 11.82% -1.28%
Construction in
progress
243795493.04 0.89% 247857777.25 1.03% -0.14%
Short-term borrowings 302238600.05 1.11% 312153969.81 1.30% -0.19%
Long-term borrowings 3050640.97 0.01% 0.01%
2. Assets and liability measured by fair value
√ Applicable □ Not applicable
In RMB
Items
Amount at the
beginning period
Changes of fair
value
gains/losses in
this period
Accumu
lative
changes
of fair
value
reckone
d into
equity
Deval
uation
of
withdr
awing
in the
period
Amount of
purchase in the
period
Amo
unt of
sale
in the
perio
d
Other changes
(+-)
Amount at
period-end
Financial
assets
1.Transaction
financial
asset(excludin
g derivative
financial
assets)
4984475661.75 383325765.19 5171830000.00 -5215410066.84 5324221360.10
2.Other equity
instrument
investment
285048000.00 285048000.00
3. Financing
of accounts
receivable
23873317.86 981651160.02 1005524477.88
Subtotal of
financial
assets
5293396979.61 383325765.19 5171830000.00 -4233758906.82 6614793837.98
Above total 5293396979.61 383325765.19 5171830000.00 -4233758906.82 6614793837.98
Financial
liabilities
0.00 0.00
Other changes
Other changes include the maturity of financial products.Whether there have major changes on measurement attributes for main assets of the Company in report period or not
□ Yes √No
3. The assets rights restricted till end of the period
Item
Book value at
period-end
Restriction reason
Monetary funds 587241.00 L/C margin
Monetary funds 51045344.11 Cash deposit paid for bank acceptance
Monetary funds 2838880.93 Dividends on 4.71 million shares of Miracle Automation and 11739102 shares of SDEC
held by the company have been frozen
Monetary funds 215720.00 Cash deposit for Mastercard
Note receivable 881914376.95 Notes pledge for bank acceptance
Receivable financing 646892501.28 Notes pledge for bank acceptance
Transaction financial
asset
174611992.62
In accordance with the civil ruling No.(2016)Y03MC2490 and No.(2016) Y03MC2492 of
Guangdong Shenzhen Intermediate People's Court (Hereinafter referred to as Shenzhen
Intermediate People's Court) the property with the value of 217 million Yuan under the name
of the Company and other seven respondents and the third party Shenzhen Hejun Chuangye
Holdings Co. Ltd. (Hereinafter referred to as Hejun Company) was frozen. As of the end of
the reporting period 4.71 million shares of Miracle Automation and 11739102 shares of
SDEC held by the Company were frozen.
Total 1758106056.89
V. Investment
1. Overall situation
□ Applicable √ Not applicable
2. The major equity investment obtained in the reporting period
□ Applicable √ Not applicable
3. The major non-equity investment doing in the reporting period
□ Applicable √ Not applicable
4. Financial assets investment
(1) Securities investment
√ Applicable □ Not applicable
In RMB
Variety
of
securitie
s
Cod
e of
secu
ritie
s
Short
form
of
secur
ities
Initial
investme
nt cost
Acc
ount
ing
mea
sure
ment
mod
el
Book value at
the beginning
of the period
Current
gain/loss of fair
value changes
Cumu
lative
fair
value
chang
es in
equity
Curr
ent
purc
hase
amo
unt
Curr
ent
sales
amo
unt
Profit and loss
in the Reporting
Period
Book value at
the end of the
period
Accou
nting
subject
Capi
tal
Sour
ce
Domesti
c and
foreign
stocks
600
841
SDE
C
199208
000.00
Mea
sure
d by
fair
valu
e
91822332.00 48573624.00 48573624.00 140395956.00
Transa
ction
financi
al asset
Own
fund
s
Domesti
c and
foreign
stocks
002
009
Mira
cle
Auto
mati
on
693315
00.00
Mea
sure
d by
fair
valu
e
36031500.00 11680800.00 11680800.00 47712300.00
Transa
ction
financi
al asset
Own
fund
s
Domesti
c and
foreign
stocks
601
456
Guol
ian
Secu
rities
120000
00.00
Mea
sure
d by
fair
valu
e
12000000.00 314848122.00 314848122.00 326848122.00
Transa
ction
financi
al asset
Own
fund
s
Total
280539
500.00
-- 139853832.00 375102546.00 0.00 0.00 0.00 375102546.00 514956378.00 -- --
Disclosure date of
securities
investment approval
of the Board
24 March 2012
4 June 2013
(2) Derivative investment
□ Applicable √ Not applicable
There are no derivative investment during the reporting period.
5. Application of raised proceeds
□ Applicable √ Not applicable
There are no application of raised proceeds during the reporting period.VI. Sales of major assets and equity
1.Sales of major assets
□ Applicable √ Not applicable
No major assets were sold during the reporting period.
2. Sales of major equity
□ Applicable √ Not applicable
VII. Analysis of the main equity participation and controlling subsidiary
√ Applicable □ Not applicable
Main subsidiary and stock-jointly enterprise with over 10% influence on net profit of the Company
In RMB
Compan
y name
Type
Main
business
Register
capital
Total assets Net assets Operating revenue Operating profit Net profit
Weifu
Leader
Subs
idiar
y
After-tre
atment
system
products
5025963
00.00
6142804328.29 1917799955.64 6427844701.00 232362335.97 245276849.88
Weifu
Jinning
Subs
idiar
y
Fuel
manage
ment
system
products
3462868
25.80
1476313489.99 1000352246.07 685608389.43 106965043.15 110875256.44
Bosch
Automo
bile
Diesel
Equi
ty
parti
cipat
ion
enter
prise
Fuel
manage
ment
system
products
USD241
000000.0
0
14960276527.96 7536627965.20 15742669081.61 3897946535.63 3511327740.19
Zhonglia
n
Electron
ic
Equi
ty
parti
cipat
ion
enter
prise
Gasoline
system
products
6006200
00.00
6187034458.77 6180707951.80 23790158.00 1543364746.77 1538581105.06
Subsidiary obtained and disposed in the Period
□ Applicable √ Not applicable
Explanation on holding equity participation enterprise
The reasons for substantial y-o-y increase in operating revenue operating profit and net profit from Weifu Leader are: sale of
after-treatment system products increased and the precious metals rose and investment income increased.VIII. The structured subject controlled by the Company
□ Applicable √ Not applicable
IX. Prospects for future development
(i) Weifu’s future development strategies
Currently a global new round of technological and industrial revolution has been prosperous at the
same time with the raising concept of “carbon emissions peak” and “carbon neutrality" will jointly
quicker the development trend to green、 low carbon、 electric networked and intelligent in theautomotive industry. Automobile accelerates the integration with related technology among energy
transportation information and communication these technologies will energize each other
develop synergistically and form a "mesh" in which more fields of main subjects participate. The
"14
th
Five-Year Plan" is a key five-year period for Weifu to achieve the medium-and long-term
development objective of 30 billion revenue in 2030. On the basis of high speed development of
doubling scale and rapid growth of profits in the "13
th
Five-Year Plan" Weifu will continue to
adhere to the strategies of "internationalization automatization and multi-dimension" accelerate the
"dual-engine" mode of "consolidating and upgrading existing businesses exploring and breaking
through new businesses markets" and strive to achieve the strategic goal of doubling the scale
again and a high level of profit.
1. Existing business will actively promote the strategic marketing strengthen market synergism increase
vigorously advanced and efficient internal combustion power technology’s research and development level
consolidate and enhance market position of the core business in significant strategic markets and customers.
1) After Treatment as support business for Weifu will achieve leapfrog growth. Promote vigorously strategic
marketing strengthen strategic customer cooperation optimize layout of business; reinforce research and
development of high effective After Treatment and China VI new technology and system integration capabilities
improve capacity of forward engineering systems integration and application development; increase control
capability of cost and quality promote steadily delicacy management.
2) FIE business as consolidating and deepening core business will realize organic growth. Consolidate and
improve common rail business process quality complete reduce costs and increase benefits expand vigorously
filter business implement differentiation marketing strategy reduce product cost improve product development
capability form large-scale sales stabilize VE/VP pump’s current market share develop new customers with
better cost control.
3) Turbo business realize high amplitude increasing. Develop actively strategic markets of four-cylinder
gasoline engine six-cylinder diesel engine strengthen high efficient pressurization technology’s research and
development capability and core product and application technology reinforce sectors’ research and development
supply chain collaboration and resource sharing improve process control capability.
4) Manufacturing business realize scale growth. Continue to enhance development of intelligent manufacturing
new technology and investment focus on cost and quality process control and actively expand strategic
customers and products.
5) Aftermarket business realize steady increase build commercial vehicle aftermarket service platform.
2. In terms of new business Fuel Cell and Intelligent Connectivity will be the two main strategic directions
focusing on and promoting driving technology and other innovative businesses seizing opportunities actively
laying out the market continuously defining and optimizing our strategic path focusing on building core
competitiveness and striving to achieve industrialization breakthrough.
1) The Fuel Cell core components business will rely on the leading advantages of actively laying out both
international and domestic market at the end of the 13
th
Five-Year Plan further accelerate the construction of
"Twin Bases" in Europe and China continuously boost the cooperation of strategic customers、the R&D of coretechnology and the ability of global business and management therefore establish the competitive advantage
position of Weifu’s main strategic business by: i. Promoting the construction of European R&D centers and
Chinese R&D centers strengthening the input of R&D investment continuously enhancing the R&D capabilities
and actively promoting the R&D of GDL、 catalyst、 single cell、 valves and other products on the basis ofexisting products such as MEA graphite BPP metal BPP and related BOP key components; ii. Strengthening the
capacity building of European and Chinese manufacturing bases achieving the global production capacity to 8
million MEAs、9 million graphite BPPs and 4 million metal BPPs in the middle and late period of the 14th
Five-Year Plan. Among them the Chinese manufacturing base will set up a hydrogen energy business department
to achieve a production capacity of 4 million MEAs、 5 million graphite BPPs and 2 million metal BPPs withrelevant BOP key components achieve small-scale batch production capacity based on Weifu's existing
manufacturing platform. iii. Intensifying the planning and coordination of global markets and operation process
realizing strategic resources sharing and efficient business collaborative among each base and business segment
and deepen the cooperation with strategic partners like Bosch and other strategic market customers.
2) For the Intelligent Connectivity Weifu will promote the Environment Situation Awareness business enhance
the key technical capabilities of millimeter wave radar take the lead in promoting commercial applications in the
fields of intelligent security、industrial intelligence、 smart medical care、 etc.， preliminary achieve large-scaledevelopment; Meanwhile Weifu will actively propel the Smart Seat business focus on the middle and high-end
commercial vehicle market and realize the industrial large-scale development by taking high performance high
quality and high cost-effective performance as product differentiation competitive advantages while actively
exploring new potential market and strategic market such as the passenger vehicles and new energy vehicles.
Beyond that Weifu will positively seek development opportunities for other intelligent connectivity business
products as well.
3) For other innovative new business areas Weifu will keep carrying forward the optimization and maturity of
electric drive products and strive to achieve breakthroughs in key application markets while actively plan and
cultivate the business of hydraulic、 electric chemical and hydrogen technologies emphasis on upholdingtechnical products such as multi-way control valve PEMEL etc.Weifu will continue to deepen the operation plan budget management and performance management system under
the guidance of Weifu’s strategic planning implement differentiated management and control effect coordination
between among business sectors boost the development of strategic core talents comprehensively enhance the
operation management ability in the new strategic transition period to meet the needs of Weifu’s medium and
long-term strategic development.(ii)Key tasks in 2021
1. Accelerate the acquisition of National VI projects and increase market share. Fuel injection system
business: ensure stable delivery of common rail pump products throughout the year; ensure the inventory of the
off-road market for VE distribution pump products and strive to form incremental breakthroughs in the tractor
loader and generator markets. Air management system business: ensure a stable share of key customers of
four-cylinder turbocharger strengthen the advantages of VNT and ensure its landing in the important customer
market. Deploy new products focus on promoting the development of gasoline engine VNT projects in key
customers and ensure the acquisition and implementation of major projects. For six-cylinder turbocharger
consolidate the existing market share and continue to expand the influence of natural gas turbochargers of medium
and heavy-duty trucks. After-treatment system business:promote the acquisition of National VI key core
customer projects to ensure market share. In terms of passenger vehicles we have obtained key customers’
National VI packaging projects and focused on the layout of joint venture brand market. In terms of commercial
vehicles we have obtained the National VI project for key customers’ diesel models and accelerated the
development of major customers’ National VI projects. On the non-road side with the announcement of the
implementation time of emission regulations we will accelerate the development of key customers and other
projects and strive to obtain the environmental protection announcements for the first batch of engines.Parts
manufacturing business: continue to promote the parts processing business of Bosch and United Electronics
especially new energy projects; strive to develop new customer groups and form new business growth points.Trade and aftermarket business: use host resources to open up turbochargers supporting the main engines to the
aftermarket in batches; import trade products urgently needed in the market. Promote the integrated development
of self-support and self-marketing foreign trade accelerate the construction of overseas market trade platforms
carry out e-commerce cross-border trade provide continuous and stable parts supply for overseas strategic
customers and enhance the market position in the global supply chain.
2. Accelerate the incubation process of new businesses and improve the ability of investment cooperation
management:promote cooperation with global strategic customers for membrane electrodes graphite bipolar
plates metal bipolar plates and auxiliary components (BOP) in hydrogen fuel cells to accelerate product
development and global production capacity layout plan accelerate the localization process of membrane
electrode and bipolar plate business build and strengthen strategic core competitiveness; environmental situation
awareness system business closely focuses on the products required by key strategic customers accelerate
application development and market breakthroughs and steadily expand other customer groups on the basis of
building and consolidating the key core competitiveness. Actively promote the market development and scale
capacity building of the smart seat business. Strengthen the capacity building of the management system after
international mergers and acquisitions focus on strengthening the comprehensive capacity building of business
planning integration governance and incubation cultural integration and talent training further enhance
international professional investment capabilities and enhance strategic partnership management.
3.Strengthen manufacturing quality management and promote intelligent manufacturing
informatization.Quality management:strengthen the maturity of product quality life cycle management
implement APQP quality valve’s application and improvement in platform development projects customer
application development projects and other process development projects; strengthen the effectiveness of
employees raising their hands review and rectification and implementation in process quality control pay close
attention to induction and changing of the guard training for workers at the production line and incorporate the
Q11 principle into the actions of each employee; improve the new version of FMEA promote the online use of
ECR and the Line Walk activity mechanism; support the forward control and system improvement of special
quality improvements in supplier side. Manufacturing operation: focus on guiding and advancing the company's
system continuous improvement projects aim at covering the company's 30 core product lines strengthening
on-site 5S inspection and guidance improving 5S standards for different production scenarios and carrying out
special rectifications against problems such as the leakage of fuel gas etc.and strive to achieve cost reduction
and tap potential. Strengthen the construction of intelligent manufacturing focus on promoting the development
of machine processing and production schedule (PPS) & PPM modules and quality management system (QMS)
modules. Complete the full coverage of the common rail business department's electronic standard operating
procedures (ESOP) EMS & measurement management; accelerate the development of smart storage technology
and complete the pilot.
4.Promote management upgrades and improve operational efficiency. Procurement and logistics
management: organization optimization promotes direct material procurement. In response to the problems in the
category analysis process start data management optimization procurement internal control system construction
and category tree management mechanism establishment. Use category expenditures and internal and external
supply market environment analysis to support the formulation of procurement strategies including supplier
compression and integration planning one-piece two-point development plan business policy selection etc.
Establish a direct material system platform. Improve the company's inventory management system optimize
inventory turnover and slow-moving inventory in terms of inventory strategy inventory analysis inventory
performance physical control etc. and strengthen the effectiveness and compliance of physical management;
continue to promote the information construction of warehousing and transportation share transportation routes
resources promote lean logistics projects such as direct delivery and recycling packaging and further realize the
resources integration of logistics efficiency improvements and cost reductions.Marketing
management:strengthen the market objective management consolidate and increase the market share of strategic
business and strategic customers; build and operate a strategic customer management system further clarify and
implement strategic market segment competition strategies; deepen the company’s key account manager platform
operating mechanism and promote the company’s marketing team planning and core talent mechanism
construction and comprehensively improve the comprehensive ability of strategic marketing. Financial
management: further optimize the shared service platform and improve user experience; optimize budget
management create a closed-loop management of strategic planning-business plan-budget control-assessment;
deeply promote cost standardization and refined management expand the dimensions of cost analysis improve the
pertinence of cost reduction measures and enhance the effectiveness and driving force of indicator assessment.
Continue to improve the quality of asset operations further reduce operating capital and improve capital operating
efficiency;
5. Improve the construction of HR information platform and optimize the talent development system. Based
on the company's strategy plan and build a talent development system to increase talent reserves; optimize the
salary policy structure and performance management system and formulate differentiated performance
evaluation model for matrix projects and key account manager working mechanisms; design customized
performance incentive programs based on the needs of business departments to enhance employees' sense of gain
and promote employees to achieve corporate goals.(iii)Possible risks and solutions
China’s economy has entered a critical period of transformation and the main theme is to reduce speed and
improve quality. China's auto market has also entered a period of transformation and adjustment. In a complex
economic environment weak consumption is still the main risk point that drags down the auto market. At the
same time with the further intensification of industry competition the emission regulations become stricter and
the raw material prices continue to rise in order to continue to maintain the company's healthy and stable
development internally the company will continue to promote internal management optimization and
improvement improve processes and control operating risks. Make great efforts to improve the company's core
competitiveness and overall anti-risk capabilities. Externally the company will pay close attention to the
macroeconomic situation national energy conservation and emission reduction regulations and policies and
actively promote product technology upgrades; pay close attention to changes in the market environment and
customer needs and rely on the company's existing business production and sales; actively expand new areas and
continue to develop strategies customers and gradually strengthen the docking of new business markets as well
as the promotion of new products look for new business growth points and seize the opportunities in the
transformation and changes of the automobile industry.In short the company will focus on the strategic vision of "devoting to becoming a leader in automobile core
components" stabilize its operating quality promote management upgrades implement strategic guidance
accelerate new business development and strive to achieve a good start for the company's "14
th
Five-Year"
strategic transformation and development.X. Reception of research communication and interview
1. In the report period reception of research communication and interview
√ Applicable □ Not applicable
Time
Reception
location
Way
Recept
ion
type
Object
Main content and information
provided
Basic situation index of investigation
22 May 2020
Conference
room
Other Other Other
Company fundamentals and
views on the market
The Online Performance Presentation for
year of 2019 (notice no.: 2020-025)
28 May 2020
Conference
room
Spot
research
Institut
ion
Institut
ion
Company fundamentals and
views on the market
Meeting site of the shareholders’ meeting
18 June 2020
Conference
room
Spot
research
Institut
ion
Institut
ion
Company fundamentals and
views on the market
Meeting site of the shareholders’ meeting
3 November
2020
Conference
room
Spot
research
Institut
ion
Institut
ion
Company fundamentals and
views on the market
Meeting site of the shareholders’ meeting
1 January -31
December 2020
Investor
relations
Written
inquiry
Other Other
Company fundamentals and
views on the market
The company answered 100 questions
from investors online through the investor
interactive
platform
relations interactive platform
1 January -31
December 2020
Company’s
telephone
Telephone
communicat
ion
Other Other
Company fundamentals and
views on the market
Company fundamentals and views on the
market more than 200 telephone
communications with investors.Reception (times) 350
Number of hospitality 50
Number of individual reception 0
Number of other reception 300
Disclosed released or let out major undisclosed information (Y/N) N
Section V. Material Matters
I. Profit distribution plan of common stock and transfer of public reserve into share capital
Formulation Implementation and Adjustment of common stock Profit Distribution Policy Especially Cash Dividend policy during
the Reporting Period
√ Applicable □ Not applicable
1. Cash dividend policy: carry out bonus distribution according to the regulations in Articles of Association
2. In reporting period the Company implemented the profit distribution for year of 2019 based on deducting the
repurchased shares in the repurchase account (15094870 shares of A-stock) from the total share capital
1008950570 shares distributed 11 Yuan (tax included) bonus in cash for every 10 shares held no capitalization
from public reserves. The plan was completed in June 2020. The implementation of the Company's cash dividend
policy is in compliance with the provisions of Articles of Association relevant decision-making procedures are
complete and fully listen to the views of independent directors and minority shareholders and maintain the
legitimate rights and interests of minority shareholders.Special explanation on cash dividend policy
Satisfy regulations of General Meeting or requirement of Article of Association (Y/N): Y
Well-defined and clearly dividend standards and proportion (Y/N): Y
Completed relevant decision-making process and mechanism (Y/N): Y
Independent directors perform duties completely and play a proper role (Y/N): Y
Minority shareholders have opportunity to express opinions and demands totally and their legal rights are fully
protected (Y/N):
Y
Condition and procedures are compliance and transparent while the cash bonus policy adjusted or changed (Y/N): Not applicable
Profit distribution plan (pre-plan) of common stock and capitalizing of common reserves plan (pre-plan) in latest three years
(including the reporting period)
The profit distribution plan for 2020: with the total share capital of the company at the end of 2020 (1008950570
shares) excluding the shares already repurchased on the repurchase account (56277 shares of A-stock) that is the
1008894293 shares as the base distribute 15.00 Yuan (tax included) in cash for every 10 shares to all shareholders
without bonus shares and capitalization of capital reserve.The profit distribution plan for 2019: with the total share capital of the company at the end of 2019 (1008950570
shares) excluding the shares already repurchased on the repurchase account (15094870 shares of A-stock) that is
the 993855700 shares as the base distribute 11.00 Yuan (tax included) in cash for every 10 shares to all
shareholders without bonus shares and capitalization of capital reserve. The plan completed in June 2020.The profit distribution plan for 2018: based on total share capital of 1008950570 shares at end of 2018
distribute cash dividend of 12.00 Yuan (tax included) for every 10 shares and no public reserve transfer into share
capital. The plan completed in June 2019.Cash dividend of common stock in latest three years (including the reporting period)
In RMB
Year for
bonus
shares
Amount for cash
bonus (tax
included)
Net profit
attributable to
common stock
shareholders of
listed company in
consolidation
statement for
bonus year
Ratio of the
cash bonus in
net profit
attributable to
common stock
shareholders of
listed company
contained in
consolidation
statement
Proportio
n for
cash
bonus by
other
ways
(i.e.share
buy-back
s)
Ratio of the cash
bonus by other
ways in net profit
attributable to
common stock
shareholders of
listed company
contained in
consolidation
statement
Total cash bonus
(including other
ways)
Ratio of the total
cash bonus (other
ways included) in
net profit
attributable to
common stock
shareholders of
listed company
contained in
consolidation
statement
2020 1513341439.50 2772769377.96 54.58% 1513341439.50 54.58%
2019 1093241270.00 2268026432.78 48.20% 1093241270.00 48.20%
2018 1210740684.00 2396077415.21 50.53% 1210740684.00 50.53%
The Company gains profits in reporting period and the retained profit of common stock shareholders provided by parent company is
positive but no plan of cash dividend proposed of common stock
□ Applicable √ Not applicable
II. Profit distribution plan and capitalization of capitalreserve in the Period
√ Applicable □ Not applicable
Bonus shares for every 10-share (Share) 0
Dividends for every 10-share (RMB) (Tax included) 15
Equity base of distribution plan (Share) 1008894293
Total cash dividend (RMB) (Tax included) 1513341439.50
Cash dividend by other ways (share buy-back included) (RMB) 0.00
Total cash dividend (other ways included) (RMB) 1513341439.50
Profits available for distribution (RMB) 11698982965.62
Ratio of the total cash dividend (other ways included) in total profit
distribution
100%
Cash dividend policy
Other
Detail explanation on profit distribution or capitalization from capital public reserve
Audited by Gongzheng Tianye Certified Public Accountants net profit of the parent company for year of 2020 amount as
2474039400 Yuan as of 31 December 2020 the profit available for distribution for shareholders amounted as 11698983000
Yuan. The profit distribution plan for 2020: with the total share capital of the company at the end of 2020 (1008950570 shares)
excluding the shares already repurchased on the repurchase account (56277 shares of A-stock) that is the 1008894293 shares as the
base distribute 15.00 Yuan (tax included) in cash for every 10 shares to all shareholders without bonus shares and capitalization of
capital reserve. (In accordance with the Company Laws shares of the company held by a listed company through a special securities
account for repurchase shall not be entitled to participate in profit distribution and capitalization of capital reserves).The remaining
undistributed profits will be carried forward to the next year. The proposed cash dividend is 1513341400 Yuan (tax included)
accounting for 54.58% of the net profit attributable to shareholder of listed company for year of 2020 in consolidate statement.Independent directors expressed their independent opinions in this regard and agreed with the above proposal. The profit
distribution proposal has yet to be deliberation by AGM of 2020.III. Implementation of undertakings
1. Undertakings that the actual controller shareholders related party buyers and the Company have
fulfilled during the reporting period and have not yet fulfilled by the end of reporting period
□ Applicable √ Not applicable
No undertakings that the actual controller shareholders related party buyers and the Company have fulfilled during the reporting
period and have not yet fulfilled by the end of the period
2. Concerning assets or project of the Company which has profit forecast and reporting period still in
forecasting period explain reasons of reaching the original profit forecast
□ Applicable √ Not applicable
IV. Non-operational fund occupation from controlling shareholders and its related party
□ Applicable √ Not applicable
No non-operational fund occupation from controlling shareholders and its related party in period.
V. Explanation from Board of Directors Supervisory Committee and Independent Directors
(if applicable) for “Qualified Opinion” that issued by CPA
□ Applicable √ Not applicable
VI. Particulars about the changes in aspect of accounting policy estimates and calculation
method compared with the financial report of last year
√ Applicable □ Not applicable
Implementation of new revenue standards: the Ministry of Finance revised the Accounting Standards for Business
Enterprise No.14- Revenue in 2017 which go into effect on 1 January 2020. The revised standard requires that the
cumulative impact of the first implementation of the standard be adjusted by the amount of opening retained
earnings and other related items in the financial statement for the period of first-time implementation for
comparable periods. Found more in the “V.-35 Change of important accounting policy and estimation” carried in
Section XII. Financial Report
VII. Major accounting errors within reporting period that needs retrospective restatement
□ Applicable √ Not applicable
No major accounting errors within reporting period that needs retrospective restatement for the Company in the period.VIII. Compare with last year’s financial report; explain changes in consolidation statement’s
scope
√ Applicable □ Not applicable
Changes of
consolidate
scope
Enterprise Equity obtained method
Contribution
ratio
Consolidate
scope increased
Borit NV
A wholly-owned subsidiary purchased in cash during the period through
SPV
100.00%
Consolidate
scope increased
Autosmart Seating
The enterprise jointly invested by controlling subsidiary of the Company -
Weifu Leader and Qiqiong Automobile Technology (Shanghai) Co. Ltd.
66%
IX. Appointment and non-reappointment (dismissal) of CPA
Accounting firm appointed
Name of domestic accounting firm
Gongzheng Tianye Certified Public Accountants
(Special General Partnership)
Remuneration for domestic accounting firm (in 10 thousand Yuan) 166
Continuous life of auditing service for domestic accounting firm 29
Name of domestic CPA Bai Lingjing Zhang Qianqian
Continuous life of auditing service for domestic accounting firm Bai Lingjing (5 years) Zhang Qianqian (1 year)
Re-appointed accounting firms in this period
□Yes √No
Appointment of internal control auditing accounting firm financial consultant or sponsor
√ Applicable □ Not applicable
Being deliberated in Annual Shareholders General Meeting of 2019 Gongzheng Tianye was appointed as audit
accounting firm for internal control of the Company for year of 2020. In the Period auditing charge for internal
control amounting to 220000 Yuan.
X.Facing delisting after annual report disclosure
□ Applicable √ Not applicable
XI. Bankruptcy reorganization
□ Applicable √ Not applicable
No bankruptcy reorganization occurred during the reporting period.XII. Major litigations and arbitrations
√ Applicable □ Not applicable
Basic Situation of Litigation
(Arbitration)
Amount
Related to
the Case
(Yuan)
Whether
Formed
Accrued
Liabilities
Progress of Litigation
(Arbitration)
Trial
Results
and
Effects of
Litigation
(Arbitratio
n)
Judgment
Implement
ation of
Litigation
(Arbitratio
n)
Disclo
sure
Date
Disclosure
Index
On March 6 2017 the
company received the civil
ruling
No.(2016)Y03MC2490 and
No.(2016) Y03MC2492
from Shenzhen Intermediate
People's Court about the
dispute case that the
plaintiff applicant China
Cinda Asset Management
Co. Ltd. Shenzhen Branch
(hereinafter referred to as
“Cinda Company”)
appealed the respondent
Weifu High Technology and
other seven respondents and
the shareholders of the third
party Hejun Company
damaged the interests of
corporate creditors which
adopted the mandatory
measures to freeze the assets
with value of RMB 217
million under the name of
the Company and other
seven respondents and
Hejun Company. Freeze
4.71 million shares of
Miracle Automation and
15.3 million shares of
SDEC Stock held by the
company.
21703 N
By the company’s application
for reconsideration Shenzhen
Intermediate People's Court
deemed the total assets that
Cinda Company applied for
preservation to be RMB
217027697.23. The total
value of 15.3 million shares of
SDEC Stock and 4.71 million
shares of Miracle Automation
held by the company has
exceeded the total assets that
Cinda Company applied for
preservation therefore
3560898 shares of SDEC
Stock held by the company
was unfrozen. Up to the end
of the reporting period the
company’s frozen assets were
as follows: 4.71 million shares
of Miracles Automation held
by the company and its fruits
and 11739102 shares of
SDEC Stock held by the
company and its fruits. At
present this litigation is in the
first instance (the first trial
held on 24 Sept. 2017 and
follow trial will wait for
notice by the court).This
litigation
will not
affect the
company’s
daily
operating
activities
for the
time being
Not yet
implement
ed
8
March
2017
(Announcem
ent No.:
2017-002)
published on
Juchao
Website
(www.cninfo.com.cn)
The Company has applied to
Futian People's Court of
Shenzhen for compulsory
liquidation with Hejun
Company
3300 N
The Company has applied to
Futian People's Court of
Shenzhen for compulsory
liquidation with Hejun
Company. The civil ruling
paper (Yue (0304) QS [2017]
No. 5) made by Shenzhen
Futian District People’s Court
ruled that Hejun Company
should be made compulsory
liquidation. The Company
will actively cooperate with
the court to work on the
liquidation to protect its
legitimate rights and interests.There is
no
impact
on daily
operation
activities
of the
Company
Relevant
works are
in process
6 Dec.
2017
(Announcem
ent No.:
2017-023)
published on
Juchao
Website
(www.cninfo.com.cn)
XIII. Penalty and rectification
□ Applicable √ Not applicable
No penalty and rectification for the Company in reporting period.XIV. Integrity of the company and its controlling shareholders and actual controllers
□ Applicable √ Not applicable
XV. Implementation of the company’s shear incentive scheme employee stock ownership plan
or other employee incentives
√ Applicable □ Not applicable
On October 12 2020 the company held the 17th meeting of the 9th Board of Directors and the 15th meeting of
the 9th Board of Supervisors which deliberated and passed the "Restricted Stock Incentive Plan 2020 (Draft) ofWeifu High Technology Group Co. Ltd.” and its summary and other related proposals it is proposed to grant
19555000 restricted shares to 602 incentive objects accounting for 1.94% of the company’s total share capital of
1008950570 shares at the time the incentive plan was signed.Specific program found more in relevant
announcement released by the Company in Juchao Website (http://www.cninfo.com.cn)dated 13 October 2020.On October 29 2020 the company received the "Approval on Weifu Hi-Tech's Implementation of Restricted
Stock Incentive Plan" from the State-owned Assets Supervision and Administration Commission of Wuxi
Municipal People's Government (XGZK [2020] No. 5) Wuxi SASAC agreed in principle that the company could
implement a restricted stock incentive plan and agreed the "Restricted Stock Incentive Plan 2020 (Draft) of WeifuHigh Technology Group Co. Ltd.” in principle.Specific program found more in relevant announcement released
by the Company in Juchao Website (http://www.cninfo.com.cn)dated 30 October 2020.On November 3 2020 the company held the second extraordinary general meeting of shareholders in 2020 and
reviewed and approved relevant proposals on the "Restricted Stock Incentive Plan 2020 (Draft) of Weifu HighTechnology Group Co. Ltd.” and its summary.Specific program found more in relevant announcement released
by the Company in Juchao Website (http://www.cninfo.com.cn)dated 4 November 2020.
Authorized by the company’s general meeting of shareholders on November 12 2020 the company held the 21st
meeting of the ninth board of directors which deliberated and approved the "Proposal on Adjusting the List of
Incentive Objects of the Restricted Stock Incentive Plan and the Number of Rights Granted" and the "Proposal on
the First Grant of Restricted Stocks to Incentive Objects of the 2020 Restricted Stock Incentive Plan" in view of
the fact that one incentive object identified in the "2020 Restricted Stock Incentive Plan of Weifu High
Technology Group Co. Ltd." voluntarily gave up 15000 shares of restricted stocks that the company intended to
grant due to personal reasons the board of directors agreed to adjust the number of incentive targets and the
number of rights granted in the equity incentive plan. After the adjustment the number of incentive objects
granted by restricted stocks has been adjusted from 602 to 601 and the number of restricted stocks granted has
been adjusted from 19555000 shares to 19540000 shares. Specific program found more in relevant
announcement released by the Company in Juchao Website (http://www.cninfo.com.cn)dated 13 November 2020
and 8 December 2020.The registration for the first grant of restricted shares under the current equity incentive plan was completed on 4
December 2020.
XVI. Major related party transaction
1. Day-to-day related party transaction
√ Applicable □ Not applicable
Related
party
Relationship
Type of
related
transact
ion
Conte
nt of
related
party
transac
tion
Pricin
g
princi
ple
Relate
d party
transac
tion
price
Related
party
transaction
amount (in
10 thousand
Yuan)
Proport
ion in
similar
transact
ions
Trading
limit
approve
d (in 10
thousand
Yuan)
Whethe
r over
the
approv
ed
limited
or not
(Y/N)
Clearin
g form
for
related
transac
tion
Availab
le
similar
market
price
Date of
disclosur
e
Index
of
disclos
ure
Weifu
Precisio
Associated
enterprise
Procure
ment of
Procur
ement
Fair
market
Marke
t price
3457.08 0.30% 3000 Y
Accord
ing to
Market
price
-21
Notice
No:202
45
n
Machine
ry
goods
and
services
of
goods
and
service
s
pricin
g
the
contrac
t
Bosch
Automo
bile
Diesel
Associated
enterprise
controlling
subsidiary of
Robert Bosch
Procure
ment of
goods
and
services
Procur
ement
of
goods
and
service
s
Fair
market
pricin
g
Marke
t price
2974.06 0.26% 2500 Y
Accord
ing to
the
contrac
t
Market
price
-21
Notice
No:202
Weifu
Environ
ment
Associated
enterprise
of Weifu
Leader
Procure
ment of
goods
Procur
ement
of
goods
Fair
market
pricin
g
Marke
t price
305141.88 26.76% 320000 N
Accord
ing to
the
contrac
t
Market
price
-21
Notice
No:202
Robert
Bosch
Compan
y
Second
largest
shareholder
of the
Company
Procure
ment of
goods
and
services
Procur
ement
of
goods
and
service
s
Fair
market
pricin
g
Marke
t price
15085.56 1.32% 15300 N
Accord
ing to
the
contrac
t
Market
price
-21
Notice
No:202
Shinwel
l
Automo
bile
Technol
ogy
(Wuxi)
Associated
enterprise
Procure
ment of
goods
Procur
ement
of
goods
Fair
market
pricin
g
Marke
t price
173.36 0.02% 500 N
Accord
ing to
the
contrac
t
Market
price
-21
Notice
No:202
Weifu
Precisio
n
Machine
ry
Associated
enterprise
Sales of
goods
and
services
Sales
of
goods
and
service
s
Fair
market
pricin
g
Marke
t price
609.24 0.05% 200 Y
Accord
ing to
the
contrac
t
Market
price
-21
Notice
No:202
Bosch
Automo
bile
Diesel
Associated
enterprise
controlling
subsidiary of
Robert Bosch
Sales of
goods
and
services
Sales
of
goods
and
service
Fair
market
pricin
g
Marke
t price
296168.43 22.99% 250000 Y
Accord
ing to
the
contrac
t
Market
price
-21
Notice
No:202
46
s
Weifu
Environ
ment
Associated
enterprise
of Weifu
Leader
Sales of
goods
and
services
Sales
of
goods
and
service
s
Fair
market
pricin
g
Marke
t price
2966.39 0.23% 3000 N
Accord
ing to
the
contrac
t
Market
price
-21
Notice
No:202
Robert
Bosch
Compan
y
Second
largest
shareholder
of the
Company
Sales of
goods
and
services
Sales
of
goods
and
service
s
Fair
market
pricin
g
Marke
t price
86061.15 6.68% 76000 Y
Accord
ing to
the
contrac
t
Market
price
-21
Notice
No:202
Shinwel
l
Automo
bile
Technol
ogy
(Wuxi)
Associated
enterprise
Sales of
goods
Sales
of
goods
Fair
market
pricin
g
Marke
t price
10.33 200 N
Accord
ing to
the
contrac
t
Market
price
-21
Notice
No:202
Bosch
Automo
bile
Diesel
Associated
enterprise
controlling
subsidiary of
Robert Bosch
Other
Techni
cal
service
fee
payabl
e
Fair
market
pricin
g
Marke
t price
18.47 50 N
Accord
ing to
the
contrac
t
Market
price
-21
Notice
No:202
Bosch
Automo
bile
Diesel
Associated
enterprise
controlling
subsidiary of
Robert Bosch
Other
Payme
nt of
techni
cal
commi
ssion
fee
etc.
Fair
market
pricin
g
Marke
t price
29.54 100 N
Accord
ing to
the
contrac
t
Market
price
-21
Notice
No:202
Robert
Bosch
Compan
y
Second
largest
shareholder
of the
Company
Other
Techni
cal
commi
ssion
payabl
e
Fair
market
pricin
g
Marke
t price
507.23 550 N
Accord
ing to
the
contrac
t
Market
price
-21
Notice
No:202
Weifu
Environ
Associated
enterprise
Other
Rental
fees
Fair
market
Marke
t price
250.81 300 N
Accord
ing to
Market
price
-21
Notice
No:202
47
ment of Weifu
Leader
receiv
able
pricin
g
the
contrac
t
Bosch
Automo
bile
Diesel
Associated
enterprise
controlling
subsidiary of
Robert Bosch
Other
Purcha
se of
fixed
assets
Fair
market
pricin
g
Marke
t price
44.77 Y
Accord
ing to
the
contrac
t
Market
price
Weifu
Precisio
n
Machine
ry
Associated
enterprise
Other
Techni
cal
service
fees
payabl
e etc.
Fair
market
pricin
g
Marke
t price
5.48 Y
Accord
ing to
the
contrac
t
Market
price
Weifu
Precisio
n
Machine
ry
Associated
enterprise
Other
Purcha
se of
fixed
assets
Fair
market
pricin
g
Marke
t price
14.52 Y
Accord
ing to
the
contrac
t
Market
price
Robert
Bosch
Compan
y
Second
largest
shareholder
of the
Company
Other
Purcha
se of
fixed
assets
Fair
market
pricin
g
Marke
t price
2292.79 Y
Accord
ing to
the
contrac
t
Market
price
Weifu
Environ
ment
Associated
enterprise
of Weifu
Leader
Other
Purcha
se of
fixed
assets
Fair
market
pricin
g
Marke
t price
3 Y
Accord
ing to
the
contrac
t
Market
price
Weifu
Environ
ment
Associated
enterprise
of Weifu
Leader
Other
Techni
cal
service
fees
payabl
e etc.
Fair
market
pricin
g
Marke
t price
6.44 Y
Accord
ing to
the
contrac
t
Market
price
Weifu
Environ
ment
Associated
enterprise
of Weifu
Leader
Other
Sales
of
fixed
assets
Fair
market
pricin
g
Marke
t price
0.94 Y
Accord
ing to
the
contrac
t
Market
price
Total -- -- 715821.47 -- 671700 -- -- -- -- --
48
Detail of sales return with major amount
involved
Not applicable
Report the actual implementation of the
day-to-day related transactions which
were projected about their total amount
by types during the reporting period (if
applicable)
Being deliberated and approved by AGM of 2019 total day-to-day related party
transaction for year of 2020 predicted as 6717 million Yuan actually 7158.2147 million
Yuan occurred in the Period the related transaction classified according to types are as: 1.it estimated that procurement of goods and labor service from related party in 2020 will up
to 3413 million Yuan while 3268.3194 million Yuan occurred actually in the Period; 2. it
estimated that sales of goods and labor service to related party in 2020 will up to 3294
million Yuan actually 3858.1554 million Yuan occurred during the reporting period for
the explosive growth of demand in commercial vehicle market especially for heavy
trucks; 3. it estimated that other related transactions with related party for year of 2020
will up to 10 million Yuan while 31.7399 million Yuan actually occurred.Reasons for major differences between
trading price and market reference price
(if applicable)
Not applicable
2. Related party transactions of assets acquisition and sold
□ Applicable √ Not applicable
No related party transactions of assets acquisition and sold occurred during the reporting period
3. Related party transactions of mutual investment outside
□ Applicable √ Not applicable
No related party transactions of mutual investment outside occurred during the reporting period.
4. Contact of related party credit and debt
□ Applicable √ Not applicable
The Company had no contact of related party credit and debt in the reporting period.
5. Other material related party transactions
□ Applicable √ Not applicable
The company had no other material related party transactions in reporting period.XVII. Significant contract and implementations
1. Trusteeship contract and leasing
(1) Trusteeship
□ Applicable √ Not applicable
49
No trusteeship occurred during the reporting period
(2) Contract
□ Applicable √ Not applicable
No contract occurred during the reporting period
(3) Leasing
□ Applicable √ Not applicable
No leasing occurred during the reporting period
2. Material guarantees
□ Applicable √ Not applicable
No material guarantees occurred during the reporting period
3. Entrust others to cash asset management
(1) Trust financing
√ Applicable □ Not applicable
Trust financing during the period
In 10 thousand Yuan
Specific type Sources of funds Amount occurred Undue balance Overdue amount
Financing products Own funds 229484 64000 0
Financial products of securities firms Own funds 75000 75000 0
Trust financial products Own funds 281280 273280 0
Other type Own funds 66030 66030 0
Total 651794 478310 0
Details of the single major amount or high-risk trust investment with low security poor fluidity and non-guaranteed
√ Applicable □ Not applicable
In 10 thousand Yuan
Truste
e
institut
ion r
name
Truste
e type
Type Amount
Source
of
funds
Start
date
End
date
Capital
investme
nt
purpose
Criteri
a for
fixing
reward
Refer
ence
annu
al
rate
of
retur
n
Anticipate
d income
(if
applicable
)
Actual
gains/los
ses in
period
Actu
al
colle
cted
gains
/loss
es in
perio
d
Amo
unt
of
reser
ve
for
deva
luati
on of
with
draw
ing
(if
Whet
her
appr
oved
by
legal
proc
edur
e
(Y/N
)
Wheth
er has
entrust
financ
e plan
in the
future
Summar
y of the
items
and
related
query
index (if
applicabl
e)
50
appli
cabl
e)
Bank Bank
Non-gua
ranteed
floating
income
156083
Own
funds
2020
-01-0
9
2021
-11-2
2
Financial
products
Refere
nce
annual
rate of
return
by the
contra
ct
3.5%
-4.25
%
3724.93 8896.26
Colle
cted
accor
ding
to the
contr
act
0 Y Y
Notice
No:2020-
015
Securit
ies
trader
Securit
ies
trader
Non-gua
ranteed
floating
income
96000
Own
funds
2020
-02-1
8
2022
-01-0
4
Collectiv
e assets
managem
ent plan
Refere
nce
annual
rate of
return
by the
contra
ct
4.2%
-6%
3437.7 1620.9
Colle
cted
accor
ding
to the
contr
act
0 Y Y
Notice
No:2020-
015
Trust Trust
Non-gua
ranteed
floating
income
203400
Own
funds
2020
-02-1
4
2022
-11-2
5
Collectio
n trust
plan
Refere
nce
annual
rate of
return
by the
contra
ct
4.7%
-8.4
%
22495.29
16414.1
4
Colle
cted
accor
ding
to the
contr
act
0 Y Y
Notice
No:2020-
015
Other
(Fund
etc.)
Other
(Fund
etc.)
Non-gua
ranteed
floating
income
61100
Own
funds
2020
-01-1
0
2022
-04-1
8
Private
Equity
Products
Refere
nce
annual
rate of
return
by the
contra
ct
5%
-8.7
%
5319.99 3500.51
Colle
cted
accor
ding
to the
contr
act
0 Y Y
Notice
No:2020-
015
Total 516583 -- -- -- -- -- -- 34977.91
30431.8
1
-- 0 -- -- --
Entrust financial expected to be unable to recover the principal or impairment might be occurred
□ Applicable √ Not applicable
(2) Entrusted loans
□ Applicable √ Not applicable
The company had no entrusted loans in the reporting period.51
4.Significant contracts for daily operation
□ Applicable √ Not applicable
5.Other significant contract
□ Applicable √ Not applicable
The company had no other significant contract in the reporting period.XVIII. Social responsibility
1.Performance of social responsibility
As for the Social Responsibility Report 2020 of the Company found more in the Juchao Website (www.cninfo.com.cn) the
information disclosure website appointed by Shenzhen Stock Exchange
2. Precise poverty alleviation social responsibility
There is no precise poverty alleviation carried out in the period and no follow plan either
3. Environmental protection
The listed Company and its subsidiary whether belong to the key sewage units released from environmental protection department:
□Yes √No
The company and its subsidiaries are not the key pollutant discharge units announced by the State Environmental
Protection Department. The company attaches great importance to environmental protection management. During
the production and operation process the company strictly abides by relevant national and local environmental
protection laws regulations and rules and timely acquires updates and conveys relevant environmental laws
regulations and standards and conducts the company’s internal daily environmental management based on new
regulations and standards. actively fulfills corporate environmental protection obligations and implements national
energy conservation and emission reduction guidelines and policies.XIX. Explanation on other material matters
□Applicable √ Not applicable
There are no explanation on other material matters in the period
XX. Material matters of subsidiary of the Company
□ Applicable √ Not applicable
52
Section VI. Changes in Shares and Particulars about Shareholders
I. Changes in Share Capital
1. Changes in Share Capital
In Share
Before the Change Increase/Decrease in the Change (+ -) After the Change
Amount
Proporti
on
New
shares
issued
Bon
us
shar
es
Publ
ic
reser
ve
trans
fer
into
share
capit
al
Others Subtotal Amount
Proporti
on
I. Restricted shares 80080 0.01% 19540750 19540750 19620830 1.94%
1. State-owned shares
2. State-owned legal person’s shares
3. Other domestic shares 80080 0.01% 19540750 19540750 19620830 1.94%
Including: Domestic legal person’s
shares
Domestic natural person’s shares 80080 0.01% 19540750 19540750 19620830 1.94%
4. Foreign shares
Including: Foreign legal person’s
shares
Foreign natural person’s shares
II. Unrestricted shares 1008870490 99.99% -19540750 -19540750 989329740 98.06%
1. RMB ordinary shares 836490490 82.90% -19540750 -19540750 816949740 80.97%
2. Domestically listed foreign shares 172380000 17.09% 172380000 17.09%
3. Overseas listed foreign shares
4. Others
III. Total shares 1008950570 100.00% 1008950570 100.00%
Reasons for share changed
□ Applicable √ Not applicable
53
Approval of share changed
□ Applicable √ Not applicable
Ownership transfer of share changed
□ Applicable √ Not applicable
Progress of shares buy-back
√ Applicable □ Not applicable
i. Basic information on the repurchase of some of the A-share
The company held the eleventh meeting of the ninth board of directors on February 13 2020 which reviewed and
approved the "Proposal on Repurchasing Part of the Company's A Shares by Centralized Bidding". It was agreed
that the company should use its own funds not less than 300 million Yuan (inclusive) and not more than 600
million Yuan (inclusive) to repurchase the company shares (A shares) for the implementation of equity incentives
and the price of repurchased shares (A shares) shall not exceed 24 Yuan/share (inclusive) the repurchase period
should not exceed 12 months from the date of approval of the repurchase plan by the company’s board of directors.The total amount of specific repurchase funds was subject to the actual funds used to repurchase shares at the end
of the repurchase period. For details please refer to the "Repurchase Report on the Repurchase of Part of the
Company's A Shares by Means of Centralized Auction Transaction" (Announcement No.: 2020-005) the company
disclosed on "China Securities Journal" "Securities Times" "Hong Kong Commercial Daily" and
www.cninfo.com.cn. On May 28 2020 the company held the 2019 annual general meeting of shareholders
reviewed and approved the "Company's 2019 Profit Distribution Plan" and agreed that the company should
distribute cash dividends of 11.00 Yuan (tax included) to all shareholders for every 10 shares. According to the
"Repurchase Plan" after completing the implementation of the company's 2019 profit distribution plan the price
of the repurchased shares (A shares) should be adjusted from no more than 24 Yuan per share to 22.92 Yuan per
share.ii. Progress and actual completion of the repurchase of some A-share
On February 28 2020 the company disclosed the "Announcement on the Initial Repurchase of the CompanyShares" (Announcement No.: 2020-006) and it disclosed the “Announcement on the Progress of RepurchasingPart of A Shares” (Announcement Nos.: 2020-007 2020-008 2020-009 2020-022 2020-033 2020-039
2020-040 2020-042 2020-043) on March 3 March 16 April 1 May 7 June 2 July 1 August 3 September 1
October 12 2020.The 17
th
meeting of the ninth board of directors of the company held on October 12 2020
reviewed and approved the "Proposal on Completing the Implementation of the Plan to Repurchase Part of the
Company’s A Shares by Centralized Auction Transaction" and the company totally repurchased 19596277
shares (A shares) through a centralized auction transaction method through a dedicated securities repurchase
account accounting for 1.9422% of the company’s total share capital of which the highest transaction price was
22.89 Yuan/share and the lowest transaction price was 17.95 Yuan/share and the total amount paid was
400017180.33 Yuan (including transaction expenses). The repurchase complied with the requirements of
relevant laws and regulations and complied with the established repurchase plan and the company completed the
implementation of the share repurchase. There was no difference between the implementation of the company's
54
share repurchase and the share repurchase plan approved by the board of directors (Announcement No.:
2020-046).
Iii. The company implemented the 2020 restricted stock incentive plan and the grant was completed for the first
time. There were a total of 601 restricted stock grant incentive objects and the number of shares granted was
19540000 shares accounting for 1.937% of the company's current total share capital.For details please refer to
the company’s publication on China Securities Journal Securities Times Hong Kong Commercial Daily and
www.cninfo.com.cn (Announcement No.: 2020-044 2020-045 2020-0482020-058 2020-059 2020-060
2020-061 2020-062 2020-063 2020-064 2020-065 2020-066).
Implementation progress of reducing holdings of shares buy-back by centralized bidding
□ Applicable √ Not applicable
Influence on the basic EPS and diluted EPS as well as other financial indexes of net assets per share attributable to common
shareholders of Company in latest year and period
□ Applicable √ Not applicable
Other information necessary to disclose or need to disclosed under requirement from security regulators
□ Applicable √ Not applicable
2. Changes of lock-up stocks
√ Applicable □ Not applicable
In Share
Shareholders
Opening
shares
restricted
Restricted
Shares Increased
in the Period
Shares
released in
Period
Ending
shares
restricted
Restricted reasons
Date for
released
Wang
Xiaodong
400000 400000
The first grant of the 2020 restricted stock
incentive plan
As required
by the rules
Xu Yunfeng 350000 350000
The first grant of the 2020 restricted stock
incentive plan
As required
by the rules
Ou Jianbin 280000 280000
The first grant of the 2020 restricted stock
incentive plan
As required
by the rules
Miao Yuming 280000 280000
The first grant of the 2020 restricted stock
incentive plan
As required
by the rules
Xu Sheng 280000 280000
The first grant of the 2020 restricted stock
incentive plan
As required
by the rules
Rong Bin 280000 280000
The first grant of the 2020 restricted stock
incentive plan
As required
by the rules
Liu Jinjun 280000 280000
The first grant of the 2020 restricted stock
incentive plan
As required
by the rules
Li Gang 280000 280000 T The first grant of the 2020 restricted stock As required
55
incentive plan by the rules
Middle
managers and
other core
personnel (593
people in
total)
17110000 17110000
The first grant of the 2020 restricted stock
incentive plan
As required
by the rules
Chen Ran 0 750 750 Elected supervisor
As required
by the rules
Total 0 19540750 0 19540750 -- --
II. Securities issuance and listing
1. Security offering (without preferred stock) in Reporting Period
□ Applicable √ Not applicable
2. Changes of total shares and shareholders structure as well as explanation on changes of assets and
liability structure
□ Applicable √ Not applicable
3. Current internal staff shares
□ Applicable √ Not applicable
III. Particulars about shareholder and actual controller of the Company
1. Amount of shareholders of the Company and particulars about shares holding
In Share
Total common
stock
shareholders in
reporting
period-end
58092
Total common
stock
shareholders at
end of last month
before annual
report disclosed
63444
Total preference
shareholders with
voting rights
recovered at end of
reporting period (if
applicable)
0
Total preference
shareholders with voting
rights recovered at end of
last month before annual
report disclosed (if
applicable)
0
Particulars about shares held above 5% by shareholders or top ten shareholders
Full name of Shareholders
Nature of
shareholder
Proport
ion of
shares
held
Total
shareholders
at the end of
report period
Changes in
report period
Number
of
lock-up
stocks
held
Amount of
un-lock up stock
held
Number of share
pledged/frozen
State of
share
Amo
unt
56
Wuxi Industry Development
Group Co. Ltd.State-owne
d corporate
20.22% 204059398 0 204059398
ROBERT BOSCH GMBH
Foreign
corporate
14.16% 142841400 0 142841400
Hong Kong Securities Clearing
Company
Foreign
corporate
6.44% 65003072 9772409 65003072
BBH BOS S/A FIDELITY FD -
CHINA FOCUS FD
Foreign
corporate
1.60% 16093515 -2436800 16093515
Central Huijin Assets
Management Co. Ltd.State-owne
d corporate
1.27% 12811200 0 12811200
Basic Pension Insurance Fund-
1003
Other 1.11% 11163306 6929142 11163306
Monetary Authority of Macao -
own fund
Foreign
corporate
0.78% 7824148 1592014 7824148
FIDELITY INVMT TRT
FIDELITY INTL SMALL CAP
FUND
Foreign
corporate
0.73% 7339586 928584 7339586
NSSF - 412 Other 0.63% 6376708 6376708 6376708
NSSF - 413 Other 0.58% 5850000 1065022 5850000
Strategy investor or general legal person
becoming the top 10 shareholders by placing
new shares (if applicable)
N/A
Explanation on associated relationship among
the aforesaid shareholders
Among the aforesaid shareholders there has no associated relationship between
Wuxi Industry Development Croup Co. Ltd. and other shareholders the first
largest shareholder of the Company; and they do not belong to the persons acting
in concert regulated by the Management Measure of Information Disclosure on
Change of Shareholding for Listed Company.
Description of the above shareholders in
relation to delegate/entrusted voting rights and
abstention from voting rights.
N/A
Particular about top ten shareholders with un-lock up stocks held
Shareholders’ name
Amount of un-lock up
stocks held at Period-end
Type of shares
Type Amount
Wuxi Industry Development Group Co. Ltd. 204059398 RMB common shares 204059398
ROBERT BOSCH GMBH 142841400
RMB common shares 115260600
Domestically listed foreign shares 27580800
Hong Kong Securities Clearing Company 65003072 RMB common shares 65003072
BBH BOS S/A FIDELITY FD - CHINA 16093515 Domestically listed foreign shares 16093515
57
FOCUS FD
Central Huijin Assets Management Co. Ltd. 12811200 RMB common shares 12811200
Basic Pension Insurance Fund- 1003 11163306 RMB common shares 11163306
Monetary Authority of Macao - own fund 7824148 RMB common shares 7824148
FIDELITY INVMT TRT FIDELITY INTL
SMALL CAP FUND
7339586 Domestically listed foreign shares 7339586
NSSF - 412 6376708 RMB common shares 6376708
NSSF - 413 5850000 RMB common shares 5850000
Expiation on associated relationship or
consistent actors within the top 10 un-lock up
shareholders and between top 10 un-lock up
shareholders and top 10 shareholders
Among the aforesaid shareholders there has no associated relationship between
Wuxi Industry Development Croup Co. Ltd. and other shareholders the first
largest shareholder of the Company; and they do not belong to the persons acting
in concert regulated by the Management Measure of Information Disclosure on
Change of Shareholding for Listed Company.
Explanation on top 10 shareholders involving
margin business (if applicable)
N/A
Whether top ten common stock shareholders or top ten common stock shareholders with un-lock up shares held have a buy-back
agreement dealing in reporting period
□ Yes √ No
The top ten common stock shareholders or top ten common stock shareholders with un-lock up shares held of the Company have no
buy-back agreement dealing in reporting period.
2. Controlling shareholder of the Company
Nature of controlling shareholders: local state-owned holding
Type of controlling shareholders: legal person
Controlling shareholders
Legal person/person
in charge of the unit
Date of
foundation
Organization code Main operation business
Wuxi Industry
Development Group
Co. Ltd.
Jiang Guoxiong
October 05
1995
913202001360026543
Authorizing the state-owned assets operation
within a certain area investment management
of significant project investment and
development of manufacturing and services
and venture capital in high-tech achievement
entrust enterprise and management etc.
Equity of other
domestic/oversea listed
company control by
controlling shareholder
as well as stock-joint in
report period
1. First majority shareholder of the Company—Industry Group is the controlling shareholder of Wuxi
Taiji Industry Corporation Limited (stock code: 600667).
2. The majority shareholder of the Company Industry Group holds 23185000 circulating shares (15.65%
of total shares of New Hongtai) of Wuxi New Hongtai Electrical Technology Co. Ltd. (Short name: New
Hongtai Stock Code: 603016).
Changes of controlling shareholders in reporting period
58
□ Applicable √ Not applicable
The Company had no changes of controlling shareholders in reporting period
3. Actual controller and person acting in concert of the Company
Nature of actual controller: local state-owned assets management
Type of actual controller: legal person
Actual controlling shareholders
Legal person/person in
charge of the unit
Date of
foundation
Organization
code
Main operation business
State-owned Assets Supervision &
Administration Commission of Wuxi
Municipality of Jiangsu Province
～ ～
State-owned Assets
management
Equity of domestic/oversea listed company
control by actual controller in report period
Not applicable
Changes of actual controller in reporting period
□ Applicable √ Not applicable
No changes of actual controllers for the Company in reporting period.Property right and controlling relationship between the actual controller and the Company is as follow
59
Actual controller controlling the Company by entrust or other assets management
□ Applicable √ Not applicable
4. Particulars about other legal person shareholders with over 10% shares held
√Applicable □Not applicable
Corporate
shareholders
Legal
rep./person in
charge of unit
Dated
founded
Register
capital
Main business or management activity
ROBERT
BOSCH
GMBH
Heiko Carrie
Bettina
Holzwarth
November
15 1886
1200
million
euros
Development manufacture and sales of automotive equipment and engine
equipment; engaged in electro-technical electronic technology machinery
manufacturing and optical system as well as produce iron metal and
plastic products and similar commodity. The company engaged in varies
trading business concerned with its business scope and established
relevant company concerned with its business scope.
5. Restriction on shares reduction for controlling shareholders actual controllers restructuring side and
other undertakings entity
□ Applicable √ Not applicable
60
Section VII. Preferred Stock
□ Applicable √ Not applicable
The Company had no preferred stock in the Period.61
Section VIII. Convertible Bonds
□ Applicable √ Not applicable
The Company had no convertible bonds in the Period
62
Section IX. Particulars about Directors Supervisors Senior
Executives and Employees
I. Changes of shares held by directors supervisors and senior executives
Name
Title
Working
status
Sex
(M/F)
Age
Start dated
of office
term
End date
of office
term
Shares
held at
period-b
egin
(Share)
Amou
nt of
shares
increas
ed in
this
period
(Share
)
Amo
unt
of
shar
es
decr
ease
d in
this
peri
od
(Sha
re)
Other
changes
(share)
Shares
held at
period-end
(Share)
Wang
Xiaodong
Chairman
Currently in
office
M 54
May 28
2020
June 26
2021
20781 400000 420781
Rudolf
Maier
Vice Chairman
Currently in
office
M 63
March 7
2012
June 26
2021
Xu
Yunfeng
Vice Chairman GM
Currently in
office
M 49
May 28
2020
June 26
2021
13000 350000 363000
Ou Jianbin
Director Executive
Deputy General
Manager and
financing Charger
Currently in
office
M 54
March 7
2012
June 26
2021
10000 280000 290000
Zhang
Xiaogeng
Director
Currently in
office
M 57
May 28
2015
June 26
2021
Chen
Yudong
Director
Currently in
office
M 59
March 7
2012
June 26
2021
Hua
Wanrong
Director
Currently in
office
F 56
March 7
2012
June 26
2021
Yu Xiaoli
Independent
Director
Currently in
office
F 57
June 27
2018
June 26
2021
Lou
Diming
Independent
Director
Currently in
office
M 57
May 28
2015
June 26
2021
63
Jin
Zhangluo
Independent
Director
Currently in
office
M 70
May 28
2015
June 26
2021
Xu
Xiaofang
Independent
Director
Currently in
office
M 57
May 28
2015
June 26
2021
Shi
XingYuan
Chairman of the
Supervisory
Committee
Currently in
office
M 58
March 7
2012
June 26
2021
12673 12673
Ma
Yuzhou
Supervisor
Currently in
office
M 46
June 27
2018
June 26
2021
Chen Ran Supervisor
Currently in
office
M 48
May 28
2020
June 26
2021
1000 1000
Miao
Yuming
Deputy GM
Currently in
office
M 57
April 16
2003
June 26
2021
10000 280000 290000
Xu Sheng Deputy GM
Currently in
office
M 46
May 28
2020
June 26
2021
280000 280000
Rong Bin Deputy GM
Currently in
office
M 45
May 28
2020
June 26
2021
280000 280000
Liu Jinjun Deputy GM
Currently in
office
M 45
May 28
2020
June 26
2021
280000 280000
Li Gang Chief engineer
Currently in
office
M 50
May 28
2020
June 26
2021
280000 280000
Zhou
Weixing
Secretary of the
Board
Currently in
office
M 57
June 9
2005
June 26
2021
3565 120000 123565
Chen
Xuejun
Chairman Leave office M 53
March 7
2012
May 28
2020
34753 34753
Dai
Lizhong
Supervisor Leave office M 45
June 27
2018
May 28
2020
2000 2000
Total -- -- -- -- -- -- 106772 1000 0 2550000 2657772
II. Changes of directors supervisors and senior executives
√Applicable □Not applicable
Name Position Type Date Cause
Wang Xiaodong Chairman Be elected May 28 2020 Be elected
Xu Yunfeng Vice Chairman Be elected June 18 2020 Be elected
Xu Yunfeng GM Appointment May 28 2020 Appointment
Xu Sheng Deputy GM Appointment May 28 2020 Appointment
Rong Bin Deputy GM Appointment May 28 2020 Appointment
64
Liu Jinjun Deputy GM Appointment May 28 2020 Appointment
Li Gang Chief engineer Appointment May 28 2020 Appointment
Chen Ran Supervisor Be elected May 28 2020 Be elected
Chen Xuejun Chairman Leave office May 28 2020 Application for resignation due to work reasons
Chen Xuejun Director Leave office June 18 2020 Application for resignation due to work reasons
Dai Lizhong Supervisor Leave office May 28 2020 Application for resignation due to work reasons
III. Post-holding
Professional background major working experience and present main responsibilities in Company of directors supervisors and
senior executive
Mr. Wang Xiaodong was born in November 1966 communist party members a university graduate MBA and senior
engineer. He previously served as Division Chief of Products Development Department of the Company Deputy
GM of Bosch Automobile Diesel supervisor of the Company and vice chairman and GM of the Company.
Currently serves as Party Secretary and chairman of the Company.
Mr. Rudolf Maier was born in October 1957 a German citizenship with a doctor degree. He previously was GM
of Bosch Automobile Diesel System Co. Ltd. executive deputy president of diesel system division and chairman
of commercial vehicle dept. in Robert Bosch Group; now he serves as Vice Chairman of the Company.Mr. Xu Yunfeng born in November 1971 a member of the Communist Party of China a university graduate an
engineer and holds a master's degree. He used to serve as assistant to general manager general manager of WFDS
deputy general manager of the Company etc.; He currently serves as deputy secretary of the party committee of
the Company vice president and general manager of the Company.Mr. Ou Jianbin born in June 1966 communist party members a senior college graduated and an accountant.Previously served as Deputy Minister of Financial Department of Weifu Company Director and deputy GM of
subsidiary Weifu Jinning Deputy GM and GM of subsidiary Weifu Leader and supervisor of the Company.
Currently he serves as director and standing deputy GM as well as chief of the financial of the Company.
Mr. Zhang Xiaogeng born in March 1963 college degree senior economist. He previously served as clerk of the
production system office at commission for restructuring of Wuxi City deputy director of enterprise reform
department of Wuxi City director of comprehensive institution department of Wuxi City director of development
and planning department (policy and regulation division) of SASAC of Wuxi City and deputy GM of Wuxi
Industry Asset Management Co. Ltd; now he serves as the deputy President of Industry Group the first majority
shareholder of the Company and Director of the Company.Mr. Chen Yudong was born in September 1961 an America citizenship and a Doctor. He previously served as
65
senior vice president of the gasoline system division of Robert Bosch Group executive vice president of Bosch
(China) Investment Ltd. Now he serves as President of Bosch (China) Investment Ltd. and director of the
Company.
Ms. Hua Wanrong born in September 1964 communist party membersgraduated from college a senior
accountant. She previously she served as deputy director of administrative resources division of State-owned
Assets Supervision and Administration Bureau of Wuxi City director of tax policy and regulations division and
director of state-owned assets division of Wuxi Municipal Bureau of Finance director of property management
department and director of development and planning department of State-owned Assets Supervision and
Administration Commission of Wuxi City director of investment banking department of major shareholder –
Industry Group. Currently she serves as Chairman of Holding subsidiary Jiangsu Sunport Power Tech. Co. Ltd.of majority shareholder Industry Group and Director of the Company.Ms. Yu Xiaoli born in January 1963 a member of the Communist Party of China Ph.D. a professor of Zhejiang
Universityserved as an independent director of the sixth and seventh board of directors of the Company and the
dean of the engineering branch of Zhejiang University City College. She is currently a professor at Zhejiang
University the chairman of the Society of Automotive Engineers of Zhejiang an director of Zhejiang Bozhong
Automobile Technology Co. Ltd. an independent director of Zhejiang Fenglong Electric Co. Ltd. an
independent director of Hangzhou EVTECH Co. Ltd. an independent director of Zhejiang Wanding Precision
Technology Co. Ltd. and an independent director of the Company.Mr. Lou Diming born in July 1963 a member of the Communist Party of China has a Ph.D. and is a professor. He
used to be the deputy director and the secretary of the party branch of the Department of Mechanical Engineering of
Shanghai Railway Institute the deputy secretary of the party committee of the School of Mechanical Engineering of
Tongji University and the party secretary of the Department of Locomotive and Vehicle Engineering of Tongji
University and theexecutive vice president of the Institute of Rail Transit and the secretary of the second joint
committee of Tongji University etc. He is currently a professor of Tongji University a doctoral tutordirector of
Nanchang Intelligent New Energy Vehicle Research Institute vice chairman of the Shanghai Internal Combustion
Engines Society director of the China Society for Internal Combustion Engines vice chairman of the small and
medium power diesel engine branch and the oils and clean fuelsbranch and the post-processing technology branch
a member of the Expert Technical Committee of the National Technical Committee for Internal Combustion Engine
of Standardization Administration of China a member of the Expert Committee of the China Internal Combustion
Engine Industry Association an independent director of Shanghai Diesel Engine Co. Ltd. an independent director
of Jiangsu Liance Electromechanical Technology Co. Ltd. a senior consultant of Kunming Yunnei Power Co.Ltd.and an independent director of the Company.Mr. Jin Zhangluo born in August 1950 a member of the Communist Party of China holds a college degree and is
a certified public accountant and senior accountant. He used to be the financial controller of Jintan Diesel Engine
66
Factory in Jiangsu Province deputy section chief section chief and chief accountant of finance section of Wuxi
Power Machine Factory and department manager deputy director and executive deputy director of Jiangsu
Gongzheng Certified Public Accountants. He currently serves as an independent director ofSuzhou Taihu Electric
New Materials Co. Ltd. and independent director of the Company.Mr. Xu Xiaofang born in March 1963 communist party membersgraduate a lawyer. He previously he served as
part-time lawyer in Beihai Economic Law Firm staff in China Chamber of International Commerce Beihai
Branch part-time lawyer of Guangdong Yuanjian Law Firm and staff of legal affairs in CEIEC and lawyer of
Guangdong Bohe Law Firm. Now he serves as lawyer in Kunlun (Shenzhen) Law Firm arbitrator of the
Shenzhen Arbitration Commission independent director of Shenzhen Kaizhong Precision Technology Co. Ltd
independent director of Doctorglasses Chain Co.Ltd and independent director of the Company.Mr. Shi XingYuan was born in May 1962 communist party members a postgraduateMaster of Commerce and
Industry senior engineer. He previously he served as GM and Director of the Company; now he serves as Chairman of
the Supervisory Committee and Chairman of the Labor Union of the Company.Mr. Ma Yuzhou was born in September 1974 communist party members owns Master’s degree and a engineer.He previously served as Deputy GM of Weifu Tianli Deputy GM and GM of the mechanical system division of
the Company; now he serves as Deputy Secretary of the Party Committee and Supervisor of the Company.Mr. Chen Ran born in December 1972 is a member of the Communist Party of China holds a bachelor’s degree
and is senior human resource manager. He once served as deputy director of the company’s management
department deputy director of the investment and audit department director of human resources department
deputy director of the party and mass department deputy director of administration department deputy director of
engineering procurement department director of the company’s party and mass department and director of the
disciplinary inspection and supervision department. He is currently a supervisor of the Company and the director
of the company's organization and personnel department.Mr. Miao Yuming born in April 1963 communist party members a university background MBA and senior engineer.He previously served as director of sales department and assistant GM in the Company. Currently he serves as
deputy GM of the Company deputy GM of Bosch Automobile Diesel.Mr. Xu Sheng born in March 1974 a member of the Communist Party of China graduate degree holds a
master’s degree and is an engineer. He once served as secretary of the party committee of the company’s party
committee work department deputy director of the office of the general manager of the company deputy
secretary of the party branch and deputy factory manager of the company’s injector parts branch HSE manager of
Bosch Automotive Diesel senior manager of BPS director of MOE5 and assistant general manager of the
company. He is currently the deputy general manager of the Company.67
Mr. Rong Bin born in December 1975 a member of the Communist Party of China holds a bachelor's degree
and is an assistant engineer. He once served as vice plant manager of the company's plunger branch deputy
manager of the common rail component company deputy manager and manager of the first manufacturing
department of the company's mechanical system business department assistant to the general manager deputy
general manager and general manager of the company's mechanical system business department and general
manager of the automotive diesel system division and general manager of the mechanical system division. He
currently serves as the deputy general manager of the Company.Mr. Liu Jinjun born in September 1975 a member of the Communist Party of China holds a bachelor’s degree
and a master’s degree and is an engineer. He once served as the manager of the personnel administration
department and technical sales manager of Wuxi Weifu Automotive Diesel System Co. Ltd. the director of the
company's human resources department the director of the company's strategy and marketing department the
company's supervisor the director of the company's strategy and new business department and the director of the
market development department. He is currently the deputy general manager of the Company.Mr. Li Gang born in November 1970 is a member of the Chinese Communist Party holds a bachelor’s degree
and a master’s degree and is a senior engineer. He once served as the product design engineer of the company's
technology center the production supervisor of the production department and the technical director of the
technical sales department of Wuxi Weifu Automotive Diesel System Co. Ltd. the deputy director of the
company's technology center deputy dean of the company's engineering technology research institute and the
director of the technology center and the standing deputy director (deputy chief engineer) of the company's
technology center. He is currently the chief engineer of the Company.Mr. Zhou Weixing born in January 1963 communist party members graduate from University a senior engineer.He previously served as representative of security affairs and director of security office of the Company; now he
serves as secretary of the Board of the Company.Post-holding in shareholder’s unit
√ Applicable □ Not applicable
Name Name of shareholder’s unit
Position in
shareholder’s
unit n
Start dated of
office term
End date
of office
term
Received
remuneration from
shareholder’s unit
(Y/N)
Rudolf Maier Robert Bosch Group Consultant Y
Chen Yudong Bosch (China) Investment Ltd. President January 1 2011 Y
Zhang
Xiaogeng
Wuxi Industry Development Group Co. Ltd. Vice president April 1 2008 Y
68
Hua Wanrong Jiangsu Sunport Power Tech. Co. Ltd. Chairman Y
Miao Yuming Bosch Automobile Diesel System Co. Ltd. Deputy GM March 1 2012 Y
Post-holding in other unit
√ Applicable □ Not applicable
Name Name of other units Position in other unit
Start dated of
office term
End date
of office
term
Received
remuneration
from other unit
(Y/N)
Yu Xiaoli Zhejiang University Teacher and professor August 1 1985
Yu Xiaoli
Society of Automotive Engineers of
Zhejiang
Director-general June 1 2015
Yu Xiaoli
Zhejiang Bozhong Auto Technology
Co. Ltd
Director April 1 2008
Yu Xiaoli Zhejiang Fenglong Electric Co. Ltd Independent Director April 1 2016
Yu Xiaoli Hangzhou EVTECH Co. Ltd Independent Director June 1 2016
Yu Xiaoli
Zhejiang Wanding Precision
Technology Co. Ltd.Independent Director
Lou Diming Tongji University
Professor doctoral
supervisor
April 15 2000
Lou Diming
Nanchang Intelligent New Energy
Vehicle Research Institute
Director
Lou Diming Shanghai Diesel Engine Co. Ltd Independent Director May 20 2015
Lou Diming
Jiangsu Liance Electromechanical
Technology Co. Ltd
Independent Director June 1 2017
Lou Diming Kunming Yunnei Power Co. Ltd Senior consultant August 1 2018
Jin Zhangluo
Suzhou Taihu Electric Advanced
Material Co. Ltd
Independent Director February 4 2016
Xu Xiaofang Kunlun (Shenzhen) Law Firm Lawyer September 1 2004
Xu Xiaofang
Shenzhen Kaizhong Precision
Technology Co. Ltd
Independent Director June 1 2018
Xu Xiaofang
independent director of
Doctorglasses Chain Co.Ltd
Independent Director
Explanation on
post-holding in
other unit
The aforesaid are the independent directors of the Company
Punishment of securities regulatory authority in recent three years to the company’s current and outgoing directors supervisors and
senior management during the reporting period
□ Applicable √ Not applicable
69
IV. Remuneration for directors supervisors and senior executives
Decision-making procedures recognition basis and payment for directors supervisors and senior executives
1. Decision-making procedure: the remuneration and review committee of the Board shall make proposals
according to completion status of the major annual targets the implementation of which is subject to submission
to and approval by the Board;
2. Determination reference: remuneration of directors supervisors and senior management who receive
remuneration from the Company is determined based on the annual operating results assessment measures of
senior management and remuneration management rules of senior management as approved at the general
meetings. Salary for independent directors of the Company is determined by general meeting which is set at RMB
25000 per quarter (after tax) and the traveling expense occurred by them arising from attending the Company’s
board meeting general meetings and relevant activities will be reimbursed according to the actual conditions.
3. Actual payment: remuneration of directors supervisors and senior management who receive remuneration from
the Company comprises of basic annual pay and performance related annual salary. The basic annual pay shall be
determined based on specific positions and paid monthly while the performance related salary is determined and
paid based on satisfaction of the various performance indicators since it is directly linked with the economic
benefits of the Company. Remuneration of independent directors will be paid on a quarterly basis.Remuneration for directors supervisors and senior executives in reporting period
In 10 thousand Yuan
Name Title Sex Age
Post-holding
status
Total
remuneration
obtained from
the Company
(before taxes)
Whether
remuneration
obtained from related
party of the Company
(Y/N)
Wang Xiaodong Chairman M 54 Currently in office 222.1 N
Rudolf Maier Vice Chairman M 63 Currently in office Y
Xu Yunfeng Vice Chairman GM M 49 Currently in office 171.9 N
Ou Jianbin
Director Executive Deputy General
Manager and financing Charger
M 54 Currently in office 171.9 N
Zhang Xiaogeng Director M 57 Currently in office Y
Chen Yudong Director M 59 Currently in office Y
Hua Wanrong Director F 56 Currently in office Y
Yu Xiaoli Independent Director F 57 Currently in office 12 N
Lou Diming Independent Director M 57 Currently in office 12 N
Jin Zhangluo Independent Director M 70 Currently in office 12 N
Xu Xiaofang Independent Director M 57 Currently in office 12 N
Shi XingYuan
Chairman of the Supervisory
Committee
M 58 Currently in office 171.9 N
70
Ma Yuzhou Supervisor M 46 Currently in office 122.4 N
Chen Ran Supervisor M 48 Currently in office 55.5 N
Miao Yuming Deputy GM M 57 Currently in office Y
Xu Sheng Deputy GM M 46 Currently in office 129.8 N
Rong Bin Deputy GM M 45 Currently in office 105 N
Liu Jinjun Deputy GM M 45 Currently in office 118.5 N
Li Gang Chief engineer M 50 Currently in office 107.1 N
Zhou Weixing Secretary of the Board M 57 Currently in office 73.7 N
Chen Xuejun Chairman M 53 Leave office 245.6 N
Dai Lizhong Supervisor M 45 Leave office 3.2 N
Total -- -- -- -- 1746.6 --
Delegated equity incentive for directors supervisors and senior executives in reporting period
√ Applicable □ Not applicable
In share
Name Position
Number
of shares
exercisa
ble
during
the
reportin
g period
Number of
shares
exercised
during the
reporting
period
Exercise
price of
the
shares
exercise
d
(RMB/S
hare)
Market
price at
end of
the
Period
(RMB/S
hare)
Number
of
restricte
d shares
held at
beginnin
g of the
Period
Numb
er of
shares
unlock
ed
during
the
period
Number of
new
restricted
shares
granted
during the
reporting
period
Grant
price of
restricted
shares
(RMB/S
hare)
Number of
restricted
shares held
at end of
the
reporting
period
Wang
Xiaodong
Chairman Secretary of
the Party Committee
23.19 400000 15.48 400000
Xu
Yunfeng
Vice Chairman General
Manager Deputy
Secretary of the Party
Committee
23.19 350000 15.48 350000
Ou Jianbin
Director Executive
Deputy General Manager
23.19 280000 15.48 280000
Miao
Yuming
Deputy GM 23.19 280000 15.48 280000
Xu Sheng Deputy GM 23.19 280000 15.48 280000
Rong Bin Deputy GM 23.19 280000 15.48 280000
Liu Jinjun Deputy GM 23.19 280000 15.48 280000
Li Gang Chief engineer 23.19 280000 15.48 280000
Zhou
Weixing
Secretary of the Board 23.19 120000 15.48 120000
Total -- 0 0 -- -- 0 0 2550000 -- 2550000
71
V. Particulars of workforce
1.Number of Employees Professional composition Education background
Employee in-post of the parent Company(people) 2580
Employee in-post of main Subsidiaries (people) 2809
The total number ofcurrent employees(people) 5389
The total number of current employees to receive pay (people) 5389
Retired employee’ s expenses borne by the parent Company and main Subsidiaries(people) 0
Professional composition
Category of professional composition
Numbers of professional
composition (people)
Production personnel 3208
Sales personnel 176
Technical personnel 1238
Financial personnel 89
Administrative personnel 678
Total 5389
Education background
Category of education background Numbers (people)
Master degree and above 321
Undergraduate 1450
Junior college 1104
Other 2514
Total 5389
2. Remuneration Policy
The company further improved the performance management and salary management system strengthened the
scientificity and pertinence of performance goals closely followed the company’s strategy and business plan and
gave full play to the guidance and promotion of the goals; centering on business needs established a
dual-dimensional performance evaluation and incentive model based on the business model of the key account
manager to promote the implementation of the new mechanism; strengthened the close relationship between
employee income and business results and gave full play to the incentive effect. The company further gave play
to the role of incentive funds strengthened the promotion and incentives of major innovative development
projects and promoted the realization of the company's strategic goals.72
3. Training programs
Based on the employee competency model the company strengthened the cooperation with relevant colleges and
consulting management companies and developed special training plans for management cadres and personnel in
various business lines. Established and formed a pilot plan for an international business talent team a "voyage +
sail" plan for a comprehensive management team a team of innovative technical talents and a team of
high-quality business talents and a craftsman plan for on-site skilled operation positions and formed a talent
development supply chain system to undertake the company's development strategy. In 2020 the company
adhered to the orientation of improving the competence of employees actively increased talent development
efforts and effectively increased the coverage of training and totally 1505 people participated in various training
throughout the year.
4. Labor outsourcing
□ Applicable √ Not applicable
Section X. Corporate Governance
I. Corporate governance of the Company
During the reporting period the Company earnestly implemented the Basic Internal Control Standards for
Enterprise and its guidance in strict accordance to the requirements of the Company Law Securities Law Listing
Rules of Shenzhen Stock Exchange as well as Guidance on Standard Operation of Listed Company of Shenzhen Stock
Exchange continued to improve and enhance legal person governance structure and internal control system thus to
standardize its operation.The actual status of corporate governance in accordance with the requirements of China
Securities Regulatory Commission regulatory documents related to listing Corporation.The company has established a series of document systems for standardized management including the Rules of
Procedure of three committees Working Rules internal control system Evaluation Management System of
Internal Control Information Disclosure Management Approach Financial Decision-making System of
Significant Investment Related Party Transaction System and Inside Information and Insider Management
System.
According to the Company Law Articles of Association and relevant laws and regulations the company
established a relatively complete organizational control architecture system. The company’s board of
directorsexecutes the resolution of general meeting of stockholders takes charge of the company’s great decisions
and take responsible for the general meeting of stockholders; the company sets up the general manager according
to law to preside over the company’s daily production and operation and management organize and implement
the resolutions of the board of directors and take responsible for the board of directors; the company’s board of
supervisors is the company’s supervisory body takes responsible for behaviors of the directors and senior
management and the supervise the company’s financial affairs. The board of directors has four special committees
including the strategy committee remuneration and appraisal committee audit committee and nominations
committee. The company’s general meeting of stockholders board of directors board of supervisors and
management layer have clear rights and obligations perform their own duties effectively check and balance
scientifically make decisions coordinate operations and lay a solid foundation for the company’s sustainable
stable and healthy development.The company’s independent directors perform their duties and faithfully and conscientiously fulfill their
obligations in strict accordance with relevant regulations of Articles of Association and the Independent Director
System and actively attend the board meetings and shareholders' meetings understand and obtain relevant
information before meetings; carefully consider each motion and actively participate in the discussions and make
recommendations. Seriously make independent opinions and effectively protect the interests of the company and
shareholders especially the minority shareholders. Independent directors have no objections on relevant matters
of the company.The company further implements the Basic Norms of Enterprise Internal Control and its guidelines constructs the
internal control system in the company headquarters and major subsidiaries enhance the company's management
and control level optimize the work flow improve the internal control system identify and control the
operational risks. Please see the detailed contents of 2019 Annual Internal Control Evaluation Report on
www.cninfo.com.cn which is the information disclosure website designated by Shenzhen Stock Exchange.Is there any difference between the actual condition of corporate governance and relevant regulations about corporate governance for
listed company from CSRC?
□ Yes √ No
There are no differences between the actual condition of corporate governance and relevant regulations about corporate governance
for listed company from CSRC.II. Independence of the Company relative to controlling shareholders’ in aspect of businesses personnel
assets organization and finance
1. Business: the company has a complete independent research and development procurement production and
sales systems the main business does not have horizontal competition with the controlling shareholders. The
business is absolutely separated.
2. Personnel: the company has mutual independence with its controlling shareholders in labor personnel and
salary management; there is no mixed operation and management with the controlling shareholders. The
company’s general manager vice general manager financial administrator secretary of the board and senior
executives don’t hold any position in the shareholders’ units.
3. Assets: the company's assets are independent and complete the property relations with the controlling
shareholders are clear.
4. Organization: the company has established organization completely independent from its controlling
shareholders the duty and authority of the company’s stockholders' meeting board of directors board of
supervisors and management level are clearly defined the internal management system can operate
independently.
5. Finance: the company has set up an independent financial department established the independent financial
accounting system and financial management system opened the independent bank account and paid taxes
separately according to law.III. Horizontal competition
□ Applicable √ Not applicable
IV. In the report period the Company held annual shareholders’ general meeting and
extraordinary shareholders’ general meeting
1. Annual Shareholders’ General Meeting in the report period
Ordinal number of
the shareholders’
general meeting
Type
Ratio of
investor
participation
Date
Date of
disclosure
Index of disclosure
Annual General
Meeting of 2019
AGM 48.39% May 28 2020 May 29 2020
(Notice No.: 2020-026) published
on Juchao
Website(www.cninfo.com.cn)
The first
extraordinary
shareholders general
meeting of 2020
Extraordinary
shareholders general
meeting
44.80% June 18 2020 June 19 2020
(Notice No.: 2020-036) published
on Juchao
Website(www.cninfo.com.cn)
The second
extraordinary
shareholders general
meeting of 2020
Extraordinary
shareholders general
meeting
48.53%
November 3
2020
November 4
2020
(Notice No.: 2020-060) published
on Juchao
Website(www.cninfo.com.cn)
2. Request for extraordinary shareholders’ general meeting by preferred stockholders whose voting rights
restore
□ Applicable √ Not applicable
V. Responsibility performance of independent directors
1. The attending of independent directors to Board meetings and general meeting
The attending of independent directors to Board Meeting and general meeting
Independent
Director
Times of
Board meeting
supposed to
attend in the
report period
Times of
Board
meeting
Presence
Times of
attending Board
meeting by
communication
Times of
Board meeting
entrusted
presence
Times of
Board meeting
Absence
Absent the
Board Meeting
for the second
time in a row
(Y/N)
Times of
attending
shareholding
meeting
Yu Xiaoli 11 2 9 N 3
Lou Diming 11 2 9 N 3
Jin Zhangluo 11 2 9 N 3
Xu Xiaofang 11 2 9 N 3
Explanation of absent the Board Meeting for the second time in a row
Not applicable
2. Objection for relevant events from independent directors
Independent directors come up with objection about Company’s relevant matters
□ Yes √ No
Independent directors have no objections for relevant events in reporting period
3. Other explanation about responsibility performance of independent directors
The opinions from independent directors have been adopted
√ Yes □ No
Explanation on advice that accepted/not accepted from independent directors
During the reporting period the company’s independent directors have paid close attention to the company’s
operations independently performed their duties made special opinions on the company’s system improvement
and daily operating decisions in strict accordance with relevant laws and regulations and the provisions of Articles
of Association made independent and just opinions on the matters that need the independent directors’ opinions
during the reporting period and played the due role in improving the corporate governance mechanism
maintaining the legitimate rights and interests of the company and all shareholders.VI. Duty performance of the special committees under the board during the reporting period
1. Two meetings of Audit committee of the Board deliberated and approved followed: Financial Result Report of
2019 Annual Report of 2019 and its Summary Conclusion Report of auditing for year of 2019 Engagement of
audit institute for financial report of 2020 Engagement of audit institute for internal control of the Company of
2020 and Semi-Annual Report of 2020 and its Summary etc.;
2. Two meeting of remuneration and appraisal committee of the Board deliberate and approved the Remuneration
evaluation and payment for senior executive of 2019; Report on the Company's 2020 Restricted Stock Incentive Plan (Draft)
and its abstract etc;
3. A meeting of the nomination committee of the board of directors was held to review the non-independent
director candidates for the by-election and agreed to submit the director candidates to the company's board of
directors for deliberation. The qualifications and related conditions of the senior management personnel to be
appointed were reviewed and there was no objection to the senior management personnel to be appointed and
they agreed to submit to the board of directors for deliberation.VII. Works from Board of Supervisor (BOS)
The Company has risks in reporting period that found in supervisory activity from BOS
□ Yes √ No
BOS has no objection about supervision events in reporting period
VIII. Examination and incentives of senior management
Assessment and incentive of senior management of the Company is conducted pursuant to the Company Law
Articles of Association and the Annual Operating Results Assessment Measures of Senior Management and
Remuneration Management Rules of Senior Management as approved at the general meetings. Assessment of
operating results of senior management comprises of annual operating results assessment and term-of-service
operating results assessment. Assessment on results and procedure was combined and assessment results were
linked to incentives and punishment. With respect to annual operating results review the remuneration and review
committee of the Board made comprehensive assessment on satisfaction of the annual operating targets and
determined the annual remuneration incentives or punishment for senior management based on their review
results (which was implemented according to remuneration management rules of senior management) based on
the major annual operating targets set by the Board under required procedures and methods through establishment
of scientific performance indicators and assessment system and combination of scoring in terms of quantity and
review comments. During the reporting period the Company made appropriate assessment on its senior
management under the performance indicator and assessment system the results of which had been reflected in
the annual performance related remuneration.The company held the 17
th
meeting of the ninth board of directors on October 12 2020 which reviewed andapproved the"Restricted Stock Incentive Plan 2020 (Draft) of Weifu High Technology Group Co. Ltd.”
(hereinafter referred to as the "Draft") and its summary proposals and other related proposals. On November 3
2020 the company held the second extraordinary general meeting of shareholders in 2020 and reviewed and
approved the "Draft" and other related proposals. The company held the 21
st
meeting of the ninth board of
directors on November 12 2020 which reviewed and approved the "Proposal on Granting Restricted Stocks to
Incentive Objects of the Restricted Stock Incentive Plan 2020 for the First Time". It was determined that
November 12 2020 would be the first grant date and 19540000 restricted shares would be granted to 601
incentive objects at a grant price of 15.48 Yuan per share. For details please refer to the relevant announcements
disclosed by the company at www.cninfo.com.cn.Given that the company implements the 2020 restricted stock incentive plan and the incentive targets overlap
with the long-term incentives for core talents the compensation and appraisal committee of the company’s board
of directors proposes that the company’s 2020 restricted stock incentive plan suspend the provision of incentive
funds during the implementation period and use for medium and long-term incentives for core talents.IX. Internal Control
1. Details of major defects in IC appraisal report that found in reporting period
□Yes √ No
2. Appraisal Report of Internal Control
Disclosure date of full internal control
evaluation report
April 20 2021
Disclosure index of full internal control
evaluation report
Self-evaluation report of internal control for 2020 more details found in Juchao
website (www.cninfo.com.cn) appointed by Shenzhen Stock Exchange
The ratio of the total assets of units included in
the scope of evaluation accounting for the total
assets on the company's consolidated financial
statements
97.77%
The ratio of the operating income of units
included in the scope of evaluation accounting
for the operating income on the company's
consolidated financial statements
99.78%
Defects Evaluation Standards
Category Financial Reports Non-financial Reports
Qualitative criteria
See details in (II) Basis for evaluation
of internal controls and defect
identification standards of internal
controls of III Evaluation of Internal
Controls in 2020 Annual Internal
Control Self-Evaluation Report
disclosed on www.cninfo.com.cn on
April 20 2021.
See details in (II) Basis for evaluation of
internal controls and defect identification
standards of internal controls of III
Evaluation of Internal Controls in 2019
Annual Internal Control Self-Evaluation
Report disclosed on www.cninfo.com.cn
on April 20 2021.
Quantitative standard
See details in (II) Basis for evaluation
of internal controls and defect
identification standards of internal
controls of III Evaluation of Internal
Controls in 2020 Annual Internal
Control Self-Evaluation Report
disclosed on www.cninfo.com.cn on
April 20 2021.
See details in (II) Basis for evaluation of
internal controls and defect identification
standards of internal controls of III
Evaluation of Internal Controls in 2019
Annual Internal Control Self-Evaluation
Report disclosed on www.cninfo.com.cn
on April 20 2021.
Amount of significant defects in financial
reports
0
Amount of significant defects in non-financial
reports
0
Amount of important defects in financial
reports
0
Amount of important defects in non-financial
reports
0
X. Auditing report of internal control
√Applicable □ Not applicable
Deliberations in Internal Control Audit Report
Audit institute considers that: according to relevant regulations and Basic Rules of Internal Control for Enterprises Weifu
High-Technology Co. Ltd. in all major aspects keeps an efficiency of internal control of financial report dated 31 December 2020
Disclosure details of audit report of internal control Disclosed
Disclosure date of audit report of internal control (full-text) April 20 2021
Index of audit report of internal control (full-text)
Audit report of internal control for year of 2020 more details found
in Juchao website (www.cninfo.com.cn) appointed by Shenzhen
Stock Exchange
Opinion type of auditing report of IC Standard unqualified
Whether the non-financial report had major defects No
Carried out modified opinion for internal control audit report from CPA
□Yes √ No
The internal control audit report issued by CPA has concerted opinion with self-evaluation report issued from the Board
√ Yes □ No
Section XI. Corporate Bond
Whether the Company has a corporation bonds that issuance publicly and listed on stock exchange and without due on the date when
annual report approved for released or fail to cash in full on due
No
Section XII. Financial Report
I. Audit report
Type of audit opinion Standard unqualified opinion
Signing date of audit report April 16 2021
Name of audit institute Gongzheng Tianye Certified Public Accountants (Special General Partnership)
Serial of Auditing Report Su Gong W[2021]No. A443
Name of CPA Bai Lingjing Zhang Qianqian
Auditor’s Report
Su Gong W[2021]No. A443
To the Shareholders of Weifu High-Technology Group Co. Ltd.:
I. Auditing opinions
We have audited the financial statement under the name of Weifu High-Technology Group Co. Ltd. (hereinafter
referred to as WFHT) including the consolidated and parent Company’s balance sheet of 31 December 2020 and
profit statement and cash flow statement and statement on changes of shareholders’ equity for the year ended
and notes to the financial statements for the year ended.In our opinion the Company’s financial statements have been prepared in accordance with the Enterprises
Accounting Standards and Enterprises Accounting System and they fairly present the financial status of the
Company and of its parent company as of 31 December 2020 and its operation results and cash flows for the year
ended.II. Basis of opinion
We conducted our audit in accordance with the Auditing Standards for Certified Public Accountants of China. Ourresponsibilities under those standards are further described in the “Auditor’s Responsibilities for the Audit of the
Financial Statements” section of the auditor’s report. We are independent of the Company in accordance with the
Certified Public Accountants of China’s Code of Ethics for Professional Accountants and we have fulfilled our
other ethical responsibilities in accordance with the Code. We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our opinion.III. Key audit matters
Key audit matters are those matters that in our professional judgment were of most significance in our audit of
the financial statements of the current period. These matters were addressed in the context of our audit of the
financial statements as a whole and in forming our opinion thereon and we do not provide a separate opinion on
these matters.Revenue recognition is the key audit matter that we identified in auditing.
1. Matter description
As described in the 30. Revenue in Note V and 42. Operation revenue and operation cost in Note VII carried in
the financial statement WFHT achieved an operation revenue of 12883826300 Yuan for year of 2020 46.67%
increase over year of 2019.
As one of the biggest source of profits for WFHT operating revenue has a significant effect on the general
financial statement in which there are certain of inherent risks existed for the reason that the management
manipulate the timing of recognition so as to achieve specific objectives or anticipations. Therefore we will take
the Revenue recognition as the key auditing matter.
2. The solution to the matter in auditing
(1)The Company has tested the design and execution of key internal control related to revenue recycling so as to
confirm the validity of internal control;(2) The Company should make sure whether the recognition condition and
method of major operating revenue are compliance with the accounting standards for business enterprise; it also
should pay an attention to that whether the cyclical and occasional revenue is compliance with the decided
revenue recognition principle and methods;(3) Combining with status and data of the industry where WFHT is
located the Company should make a judgment on the rationality of fluctuation of the revenue composition;(4)
The Company should carry out the procedure of account receivable and revenue letter of confirmation and make
a judgment on the rationality of the timing of revenue recognition; (5) Combining with the procedure of letter of
confirmation the Company should make a random inspection on sales contracts or orders delivery lists logistics
bills customs declaration sales invoices signing-off sheet and other documents related to revenue to verify the
authenticity of revenue;(6) Referring to the recorded revenue before and after the Balance Sheet Date the
Company should select some samples and check out the supportive documents such as delivery lists customs
declaration and receipt forms to make a judgment on whether the income has been recorded at the appropriate
accounting period.IV. Other information
The management of WFHT is responsible for other information which includes the information covered in the
Company’s 2020 annual report excluding the financial statement and our audit report.
Our audit opinions on the financial statements do not cover other information and we do not issue any form of
authentication conclusions on other information.In combination with our audit of the financial statements it is our responsibility to read other information and in
the process consider whether there is material inconsistency or material misstatement between the other
information and the financial statements or what we learned during the audit.
Based on the work we have carried out if we determine that there is a material misstatement of other information
we should report that fact and i this regard we have noting to report.V. Responsibilities of management and those charged with governance for the financial statements
The management is responsible for the preparation of the financial statements in accordance with the Accounting
Standards for Enterprise to secure a fair presentation and for the design establishment and maintenance of the
internal control necessary to enable the preparation of financial statements that are free from material
misstatement whether due to fraud or error.In preparing the financial statements the management is responsible for assessing the Company’s ability to
continue as a going concern disclosing matters related to going concern (if applicable) and using the going
concern assumption unless the management either intends to liquidate the Company or to cease operations or has
no realistic alternative but to do so.Those charged with governance are responsible for overseeing the Company’s financial reporting process.VI. Responsibilities of the auditor for the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from
material misstatement whether due to fraud or error and to issue an audit report that includes our audit opinion.Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance
with the CAS will always detect a material misstatement when it exists. Misstatements can arise from fraud or
error and are considered material if individually or in the aggregate they could reasonably be expected to
influence the economic decisions of users taken on the basis of the financial statements.
As part of an audit in accordance with the CAS we exercise professional judgment and maintain professional
skepticism throughout the audit. We also:
(1) Identify and assess the risks of material misstatement of the financial statements whether due to fraud or error
design and perform audit procedures responsive to those risks and obtain audit evidence that is sufficient and
appropriate to provide a basis for audit opinion. The risk of not detecting a material misstatement resulting from
fraud is higher than for one resulting from error as fraud may involve collusion forgery intentional omissions
misrepresentations or the override of internal control.
(2) Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are
appropriate in the circumstances.
(3) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and
related disclosures made by the management.
(4) Conclude on the appropriateness of the management’s use of the going concern assumption and based on the
audit evidence obtained whether a material uncertainty exists related to events or conditions that may cast
significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material
uncertainty exists we are required by the CAS to draw users’ attention in audit report to the related disclosures in
the financial statements or if such disclosures are inadequate to modify audit opinion. Our conclusions are based
on the information obtained up to the date of audit report. However future events or conditions may cause the
Company to cease to continue as a going concern.
(5) Evaluate the overall presentation structure and content of the financial statements and whether the financial
statements represent the underlying transactions and events in a manner that achieves fair presentation.
(6) Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business
activities within the Company to express audit opinion on the financial statements. We are responsible for the
direction supervision and performance of the group audit. We remain solely responsible for audit opinion.We communicate with those charged with governance regarding among other matters the planned scope and
timing of the audit and significant audit findings including any significant deficiencies in internal control that we
identify during our audit.We also provide the governance with a statement of our compliance with the ethical requirements relating to our
independence and communicate with the governance on all relationships and other matters that may reasonably be
considered to affect our independence as well we the relevant precautions (if applicable).
From the matters communicated with those charged with governance we determine those matters that were of
most significance in the audit of the financial statements of the current period and are therefore the key audit
matters. We describe these matters in the auditor’s report unless law or regulation precludes public disclosure
about the matter or when in extremely rare circumstances we determine that a matter should not be
communicated in the auditor’s report because of the adverse consequences of doing so would reasonably be
expected to outweigh the public interest benefits of such communication.Jiangsu Gongzheng Tianye CPA Chinese CPA: Bai Lingjing
(Special General Partnership) (engagement partner)
Wuxi China Chinese CPA: Zhang Qianqian
16 April 2021
II. Financial Statement
Statement in Financial Notes are carried in RMB/CNY
1. Consolidated Balance Sheet
Prepared by Weifu High-Technology Group Co. Ltd.
December 31 2020
In RMB
Item December 31 2020 December 31 2019
Current assets:
Monetary funds 1963289832.33 1596893711.87
Settlement provisions
Capital lent
Transaction financial assets 3518432939.10 3940885674.32
Derivative financial assets
Note receivable 1657315723.56 1812141371.94
Account receivable 2824780352.41 2310666475.89
Receivable financing 1005524477.88 23873317.86
Accounts paid in advance 151873357.76 139241917.78
Insurance receivable
Reinsurance receivables
Contract reserve of reinsurance receivable
Other account receivable 54209580.88 43730023.31
Including: Interest receivable 655052.98
Dividend receivable 49000000.00 1070000.00
Buying back the sale of financial assets
Inventories 2877182174.64 2418744835.82
Contractual assets
Assets held for sale
Non-current asset due within one year
Other current assets 2137921113.61 1012055605.74
Total current assets 16190529552.17 13298232934.53
Non-current assets:
Loans and payments on behalf
Debt investment
Other debt investment
Long-term account receivable
Long-term equity investment 4801488290.97 5322405953.35
Investment in other equity instrument 285048000.00 285048000.00
Other non-current financial assets 1805788421.00 1043589987.43
Investment real estate 20886681.62 22410511.87
Fixed assets 2882230191.08 2845176078.20
Construction in progress 243795493.04 247857777.25
Productive biological asset
Oil and gas asset
Right-of-use assets
Intangible assets 454412947.69 430594372.12
Expense on Research and Development
Goodwill 257800696.32 1784086.79
Long-term expenses to be apportioned 15062171.09 18536000.25
Deferred income tax asset 198393501.50 212476501.54
Other non-current asset 195259441.73 230235982.45
Total non-current asset 11160165836.04 10660115251.25
Total assets 27350695388.21 23958348185.78
Current liabilities:
Short-term loans 302238600.05 312153969.81
Loan from central bank
Capital borrowed
Trading financial liability
Derivative financial liability
Note payable 2462592372.82 1745218439.52
Account payable 4100984240.39 3312254229.84
Accounts received in advance 4071236.87 113737432.61
Contractual liability 81717387.25
Selling financial asset of repurchase
Absorbing deposit and interbank deposit
Security trading of agency
Security sales of agency
Wage payable 332421811.82 314343737.66
Taxes payable 67493690.29 129538411.86
Other account payable 361556257.42 65266262.39
Including: Interest payable 4862.22
Dividend payable
Commission charge and commission payable
Reinsurance payable
Liability held for sale
Non-current liabilities due within one year 36914242.02
Other current liabilities 222871087.33
Total current liabilities 7972860926.26 5992512483.69
Non-current liabilities:
Insurance contract reserve
Long-term loans 3050640.97
Bonds payable
Including: Preferred stock
Perpetual capital securities
Lease liability
Long-term account payable 39479218.17 35108263.11
Long-term wages payable 181980293.94 58392053.61
Accrual liability
Deferred income 328204476.73 365116022.98
Deferred income tax liabilities 30653933.12 22566051.72
Other non-current liabilities
Total non-current liabilities 583368562.93 481182391.42
Total liabilities 8556229489.19 6473694875.11
Owner’s equity:
Share capital 1008950570.00 1008950570.00
Other equity instrument
Including: Preferred stock
Perpetual capital securities
Capital public reserve 3294242368.28 3391527806.33
Less: Inventory shares 303627977.74
Other comprehensive income 13916619.47 134871.67
Reasonable reserve 2333490.03 3247757.06
Surplus public reserve 510100496.00 510100496.00
Provision of general risk
Retained profit 13756102424.62 12076443635.56
Total owner’ s equity attributable to parent company 18282017990.66 16990405136.62
Minority interests 512447908.36 494248174.05
Total owner’ s equity 18794465899.02 17484653310.67
Total liabilities and owner’ s equity 27350695388.21 23958348185.78
Legal Representative: Wang Xiaodong
Person in charge of accounting works: Ou Jianbin
Person in charge of accounting institute: Ou Jianbin
2. Balance Sheet of Parent Company
In RMB
Item December 31 2020 December 31 2019
Current assets:
Monetary funds 1157684053.05 965770877.82
Trading financial assets 3452348980.19 3758789072.68
Derivative financial assets
Note receivable 422246979.39 202403993.13
Account receivable 982782279.22 768500929.93
Receivable financing
Accounts paid in advance 75650090.49 89116730.45
Other account receivable 197335714.63 250014956.74
Including: Interest receivable 897777.78 804929.68
Dividend receivable 1070000.00
Inventories 725276241.43 565144234.49
Contractual assets
Assets held for sale
Non-current assets maturing within one year
Other current assets 2057772839.50 938616881.51
Total current assets 9071097177.90 7538357676.75
Non-current assets:
Debt investment
Other debt investment
Long-term receivables
Long-term equity investments 5978128303.88 6331363630.04
Investment in other equity instrument 209108000.00 209108000.00
Other non-current financial assets 1805788421.00 1043589987.43
Investment real estate
Fixed assets 1758198856.53 1646333216.50
Construction in progress 154741266.85 136573912.28
Productive biological assets
Oil and natural gas assets
Right-of-use assets
Intangible assets 208112706.57 203663423.60
Research and development costs
Goodwill
Long-term deferred expenses
Deferred income tax assets 76508392.85 105137877.84
Other non-current assets 117013906.01 172646721.05
Total non-current assets 10307599853.69 9848416768.74
Total assets 19378697031.59 17386774445.49
Current liabilities
Short-term borrowings 102088888.89 116126459.33
Trading financial liability
Derivative financial liability
Notes payable 448901718.36 284054137.00
Account payable 1265845068.26 930273146.35
Accounts received in advance 12010730.30
Contractual liability 6209575.73
Wage payable 216870819.60 213626754.45
Taxes payable 32974322.59 56540307.59
Other accounts payable 339096991.12 11976576.21
Including: Interest payable
Dividend payable
Liability held for sale
Non-current liabilities due within one year
Other current liabilities 182611991.54
Total current liabilities 2594599376.09 1624608111.23
Non-current liabilities:
Long-term loans
Bonds payable
Including: preferred stock
Perpetual capital securities
Lease liability
Long-term account payable
Long term employee compensation payable 176245345.03 50058386.76
Accrued liabilities
Deferred income 285714239.98 322971778.82
Deferred income tax liabilities
Other non-current liabilities
Total non-current liabilities 461959585.01 373030165.58
Total liabilities 3056558961.10 1997638276.81
Owners’ equity:
Share capital 1008950570.00 1008950570.00
Other equity instrument
Including: preferred stock
Perpetual capital securities
Capital public reserve 3407732016.61 3488221286.39
Less: Inventory shares 303627977.74
Other comprehensive income
Special reserve
Surplus reserve 510100496.00 510100496.00
Retained profit 11698982965.62 10381863816.29
Total owner’s equity 16322138070.49 15389136168.68
Total liabilities and owner’s equity 19378697031.59 17386774445.49
3. Consolidated Profit Statement
In RMB
Item 2020 2019
I. Total operating income 12883826306.60 8784356960.30
Including: Operating income 12883826306.60 8784356960.30
Interest income
Insurance gained
Commission charge and commission income
II. Total operating cost 12193088999.51 7870700853.45
Including: Operating cost 10429284441.97 6670354380.54
Interest expense
Commission charge and commission expense
Cash surrender value
Net amount of expense of compensation
Net amount of withdrawal of insurance contract reserve
Bonus expense of guarantee slip
Reinsurance expense
Tax and extras 65323781.87 66634636.66
Sales expense 406353445.10 259650752.33
Administrative expense 782824422.63 514028451.76
R&D expense 532581209.78 417924908.28
Financial expense -23278301.84 -57892276.12
Including: Interest expenses 11466886.33 21770516.39
Interest income 51622216.58 79299239.77
Add: other income 80342497.11 91170663.57
Investment income (Loss is listed with “-”) 1964805688.57 1614540714.83
Including: Investment income on affiliated company and joint
venture
1659752704.14 1378264061.18
The termination of income recognition for financial assets
measured by amortized cost(Loss is listed with “-”)
-946468.33 -2214159.11
Exchange income (Loss is listed with “-”)
Net exposure hedging income (Loss is listed with “-”)
Income from change of fair value (Loss is listed with “-”) 383325765.19 25019666.32
Loss of credit impairment (Loss is listed with “-”) -11184647.60 -52825875.25
Losses of devaluation of asset (Loss is listed with “-”) -178837472.85 -169460299.73
Income from assets disposal (Loss is listed with “-”) 11454408.60 32154460.21
III. Operating profit (Loss is listed with “-”) 2940643546.11 2454255436.80
Add: Non-operating income 66467021.62 2413561.54
Less: Non-operating expense 4158888.17 6126427.17
IV. Total profit (Loss is listed with “-”) 3002951679.56 2450542571.17
Less: Income tax expense 180215749.00 147805810.06
V. Net profit (Net loss is listed with “-”) 2822735930.56 2302736761.11
(i) Classify by business continuity
1.continuous operating net profit (net loss listed with ‘-”) 2822735930.56 2302736761.11
2.termination of net profit (net loss listed with ‘-”)
(ii) Classify by ownership
1.Net profit attributable to owner’s of parent company 2772769377.96 2268026432.78
2.Minority shareholders’ gains and losses 49966552.60 34710328.33
VI. Net after-tax of other comprehensive income 13839596.07 203603.86
Net after-tax of other comprehensive income attributable to owners of
parent company
13781747.80 134871.67
(I) Other comprehensive income items which will not be reclassified
subsequently to profit of loss
1.Changes of the defined benefit plans that re-measured
2.Other comprehensive income under equity method that cannot be
transfer to gain/loss
3.Change of fair value of investment in other equity instrument
4.Fair value change of enterprise's credit risk
5. Other
(ii) Other comprehensive income items which will be reclassified
subsequently to profit or loss
13781747.80 134871.67
1.Other comprehensive income under equity method that can transfer
to gain/loss
2.Change of fair value of other debt investment
3.Amount of financial assets re-classify to other comprehensive
income
4.Credit impairment provision for other debt investment
5.Cash flow hedging reserve
6.Translation differences arising on translation of foreign currency
financial statements
13781747.80 134871.67
7.Other
Net after-tax of other comprehensive income attributable to minority
shareholders
57848.27 68732.19
VII. Total comprehensive income 2836575526.63 2302940364.97
Total comprehensive income attributable to owners of parent
Company
2786551125.76 2268161304.45
Total comprehensive income attributable to minority shareholders 50024400.87 34779060.52
VIII. Earnings per share:
(i) Basic earnings per share 2.79 2.25
(ii) Diluted earnings per share 2.79 2.25
As for the enterprise combined under the same control net profit of 0 Yuan achieved by the merged party before combination while 0
Yuan achieved last period
Legal Representative: Wang Xiaodong
Person in charge of accounting works: Ou Jianbin
Person in charge of accounting institute: Ou Jianbin
4. Profit Statement of Parent Company
In RMB
Item 2020 2019
I. Operating income 4536417803.79 3832925360.42
Less: Operating cost 3236311612.73 2641612915.27
Taxes and surcharge 38086034.27 31863942.28
Sales expenses 126442956.05 52567986.14
Administration expenses 533649297.97 292983915.45
R&D expenses 205001982.50 197574348.21
Financial expenses -34275071.44 -71470479.91
Including: interest expenses 4163923.00 6984512.71
Interest income 40948820.72 74450739.86
Add: other income 58782085.85 67874015.41
Investment income (Loss is listed with “-”) 1816759403.42 1646209064.39
Including: Investment income on affiliated Company and joint venture 1457471604.06 1310687436.86
The termination of income recognition for financial assets measured by
amortized cost (Loss is listed with “-”)
Net exposure hedging income (Loss is listed with “-”)
Changing income of fair value (Loss is listed with “-”) 383241806.28 22923064.68
Loss of credit impairment (Loss is listed with “-”) 2076529.99 -6132833.36
Losses of devaluation of asset (Loss is listed with “-”) -82232381.43 -43916712.41
Income on disposal of assets (Loss is listed with “-”) -520470.69 1887302.76
II. Operating profit (Loss is listed with “-”) 2609307965.13 2376636634.45
Add: Non-operating income 30937706.44 562276.63
Less: Non-operating expense 3493103.39 3810717.52
III. Total Profit (Loss is listed with “-”) 2636752568.18 2373388193.56
Less: Income tax 162713161.17 143606161.28
IV. Net profit (Net loss is listed with “-”) 2474039407.01 2229782032.28(i)continuous operating net profit (net loss listed with ‘-”) 2474039407.01 2229782032.28(ii) termination of net profit (net loss listed with ‘-”)
V. Net after-tax of other comprehensive income
(I) Other comprehensive income items which will not be reclassified
subsequently to profit of loss
1.Changes of the defined benefit plans that re-measured
2.Other comprehensive income under equity method that cannot be
transfer to gain/loss
3.Change of fair value of investment in other equity instrument
4.Fair value change of enterprise's credit risk
5. Other
(II) Other comprehensive income items which will be reclassified
subsequently to profit or loss
1.Other comprehensive income under equity method that can transfer
to gain/loss
2.Change of fair value of other debt investment
3.Amount of financial assets re-classify to other comprehensive
income
4.Credit impairment provision for other debt investment
5.Cash flow hedging reserve
6.Translation differences arising on translation of foreign currency
financial statements
7.Other
VI. Total comprehensive income 2474039407.01 2229782032.28
VII. Earnings per share:
(i) Basic earnings per share
(ii) Diluted earnings per share
5. Consolidated Cash Flow Statement
In RMB
Item 2020 2019
I. Cash flows arising from operating activities:
Cash received from selling commodities and providing labor services 11908396653.71 8145939987.84
Net increase of customer deposit and interbank deposit
Net increase of loan from central bank
Net increase of capital borrowed from other financial institution
Cash received from original insurance contract fee
Net cash received from reinsurance business
Net increase of insured savings and investment
Cash received from interest commission charge and commission
Net increase of capital borrowed
Net increase of returned business capital
Net cash received by agents in sale and purchase of securities
Write-back of tax received 32138413.08 51722970.47
Other cash received concerning operating activities 102573818.52 143912897.80
Subtotal of cash inflow arising from operating activities 12043108885.31 8341575856.11
Cash paid for purchasing commodities and receiving labor service 8277296527.38 5020827379.58
Net increase of customer loans and advances
Net increase of deposits in central bank and interbank
Cash paid for original insurance contract compensation
Net increase of capital lent
Cash paid for interest commission charge and commission
Cash paid for bonus of guarantee slip
Cash paid to/for staff and workers 1295921487.63 1222358828.87
Taxes paid 788150479.38 501167008.38
Other cash paid concerning operating activities 899929156.91 548552586.05
Subtotal of cash outflow arising from operating activities 11261297651.30 7292905802.88
Net cash flows arising from operating activities 781811234.01 1048670053.23
II. Cash flows arising from investing activities:
Cash received from recovering investment 8051178224.52 11384917612.00
Cash received from investment income 2462910424.30 1230657039.85
Net cash received from disposal of fixed intangible and other long-term 42851678.36 147609697.19
assets
Net cash received from disposal of subsidiaries and other units
Other cash received concerning investing activities 65102250.70 70025432.83
Subtotal of cash inflow from investing activities 10622042577.88 12833209781.87
Cash paid for purchasing fixed intangible and other long-term assets 492683539.12 589522818.28
Cash paid for investment 9246030000.00 13384156157.81
Net increase of mortgaged loans
Net cash received from subsidiaries and other units obtained 297302758.31 49930740.75
Other cash paid concerning investing activities 14579308.94 25115357.50
Subtotal of cash outflow from investing activities 10050595606.37 14048725074.34
Net cash flows arising from investing activities 571446971.51 -1215515292.47
III. Cash flows arising from financing activities
Cash received from absorbing investment 312640853.85 14022428.73
Including: Cash received from absorbing minority shareholders’
investment by subsidiaries
10161653.85 14022428.73
Cash received from loans 395691406.43 809517778.36
Other cash received concerning financing activities 5730135.13 845291.11
Subtotal of cash inflow from financing activities 714062395.41 824385498.20
Cash paid for settling debts 371154665.80 841746769.02
Cash paid for dividend and profit distributing or interest paying 1120464009.41 1258933561.00
Including: Dividend and profit of minority shareholder paid by
subsidiaries
15748768.80 26271705.11
Other cash paid concerning financing activities 449251421.46 146064936.00
Subtotal of cash outflow from financing activities 1940870096.67 2246745266.02
Net cash flows arising from financing activities -1226807701.26 -1422359767.82
IV. Influence on cash and cash equivalents due to fluctuation in exchange rate -2003139.41 5029521.42
V. Net increase of cash and cash equivalents 124447364.85 -1584175485.64
Add: Balance of cash and cash equivalents at the period -begin 820498653.85 2404674139.49
VI. Balance of cash and cash equivalents at the period -end 944946018.70 820498653.85
6. Cash Flow Statement of Parent Company
In RMB
Item 2020 2019
I. Cash flows arising from operating activities:
Cash received from selling commodities and providing labor services 4470039778.75 3928802469.74
Write-back of tax received
Other cash received concerning operating activities 61033856.80 77926941.80
Subtotal of cash inflow arising from operating activities 4531073635.55 4006729411.54
Cash paid for purchasing commodities and receiving labor service 2312159843.14 2163992101.67
Cash paid to/for staff and workers 730528257.00 645107564.57
Taxes paid 562371147.42 320098914.24
Other cash paid concerning operating activities 341484021.47 180660925.40
Subtotal of cash outflow arising from operating activities 3946543269.03 3309859505.88
Net cash flows arising from operating activities 584530366.52 696869905.66
II. Cash flows arising from investing activities:
Cash received from recovering investment 7324178224.52 10054917612.00
Cash received from investment income 2434385770.96 1289170321.39
Net cash received from disposal of fixed intangible and other long-term
assets
810004.53 42777932.53
Net cash received from disposal of subsidiaries and other units
Other cash received concerning investing activities 214831510.69 171801850.24
Subtotal of cash inflow from investing activities 9974205510.70 11558667716.16
Cash paid for purchasing fixed intangible and other long-term assets 262442259.33 360473332.45
Cash paid for investment 8853827446.85 11870526196.52
Net cash received from subsidiaries and other units obtained
Other cash paid concerning investing activities 112342336.68 204000000.00
Subtotal of cash outflow from investing activities 9228612042.86 12434999528.97
Net cash flows arising from investing activities 745593467.84 -876331812.81
III. Cash flows arising from financing activities
Cash received from absorbing investment 302479200.00
Cash received from loans 102000000.00 231500000.00
Other cash received concerning financing activities
Subtotal of cash inflow from financing activities 404479200.00 231500000.00
Cash paid for settling debts 116000000.00 227500000.00
Cash paid for dividend and profit distributing or interest paying 1097442763.44 1217748704.04
Other cash paid concerning financing activities 400017180.33
Subtotal of cash outflow from financing activities 1613459943.77 1445248704.04
Net cash flows arising from financing activities -1208980743.77 -1213748704.04
IV. Influence on cash and cash equivalents due to fluctuation in exchange rate -2070408.32 5250115.02
V. Net increase of cash and cash equivalents 119072682.27 -1387960496.17
Add: Balance of cash and cash equivalents at the period -begin 532115862.26 1920076358.43
VI. Balance of cash and cash equivalents at the period -end 651188544.53 532115862.26
7. Statement of Changes in Owners’ Equity (Consolidated)
Current Period
In RMB
Item
2020
Owners’ equity attributable to the parent Company
Minority
interests
Total owners’
equity Share capital
Other
equity
instrumen
t
Capital reserve
Less:
Inventory
shares
Other
comprehensi
ve income
Reasonable
reserve
Surplus
reserve
Prov
ision
of
gene
ral
risk
Retained profit
Ot
he
r
Subtotal
Pr
ef
er
re
d
st
oc
k
Pe
rp
etu
al
ca
pit
al
se
cu
riti
es
Ot
he
r
I. Balance at the
end of the last
year
100895057
0.00
3391527806.
33
134871.67 3247757.06
510100496.0
0
12076443635.56 16990405136.62 494248174.05 17484653310.67
Add: Changes of
accounting policy
Error correction of
the last period
Enterprise
combine under the
same control
Other
II. Balance at the
beginning of this
year
100895057
0.00
3391527806.
33
134871.67 3247757.06
510100496.0
0
12076443635.56 16990405136.62 494248174.05 17484653310.67
III. Increase/
Decrease in this
year (Decrease is
listed with “-”)
-97285438.05
30362797
7.74
13781747.
80
-914267.03 1679658789.06 1291612854.04 18199734.31 1309812588.35
(i) Total
comprehensive
income
13781747.
80
2772769377.96 2786551125.76 50024400.87 2836575526.63
(ii) Owners’
devoted and
decreased capital
-97285438.05
30362797
7.74
-400913415.79 -16046487.85 -416959903.64
1.Common shares
invested by
shareholders
-96389202.59
30247920
0.00
-398868402.59 25079496.04 -373788906.55
2. Capital invested
by holders of
other equity
instruments
3. Amount
reckoned into
owners equity
6280461.58 6280461.58 204375.92 6484837.50
with share-based
payment
4. Other -7176697.04
1148777.7
4
-8325474.78 -41330359.81 -49655834.59
(III) Profit
distribution
-1095767216.49 -1095767216.49 -15748768.80 -1111515985.29
1. Withdrawal of
surplus reserves
2. Withdrawal of
general risk
provisions
3. Distribution for
owners (or
shareholders)
-1093241270.00 -1093241270.00 -15748768.80 -1108990038.80
4. Other -2525946.49 -2525946.49 -2525946.49
(IV) Carrying
forward internal
owners’ equity
1. Capital reserves
conversed to
capital (share
capital)
2. Surplus
reserves
conversed to
capital (share
capital)
3. Remedying loss
with surplus
reserve
4．Carry-over
retained earnings
from the defined
benefit plans
5．Carry-over
retained earnings
from other
comprehensive
income
6. Other
(V) Reasonable
reserve
-914267.03 -914267.03 -29409.91 -943676.94
1. Withdrawal in
the report period
21673368.09 21673368.09 2158529.38 23831897.47
2. Usage in the
report period
22587635.12 22587635.12 2187939.29 24775574.41
(VI)Others 2656627.59 2656627.59 2656627.59
IV. Balance at the
end of the report
period
100895057
0.00
3294242368.
28
30362797
7.74
13916619.
47
2333490.03
510100496.0
0
13756102424.62 18282017990.66 512447908.36 18794465899.02
Last Period
In RMB
Item
2019
Owners’ equity attributable to the parent Company
Minority
interests
Total owners’
equity Share capital
Other
equity
instrument
Capital
reserve
Less:
Invent
ory
shares
Other
comprehensive
income
Reasonable
reserve
Surplus
reserve
Prov
ision
of
gene
ral
risk
Retained profit
Ot
he
r
Subtotal
Pre
fer
red
sto
ck
Pe
rp
et
ua
l
ca
pit
al
se
cu
rit
ies
Ot
he
r
I. Balance at the
end of the last
year
10089505
70.00
34160227
95.14
-19809442.95 1618490.50
510100496.0
0
10996945870.13 15913828778.82 538142268.53 16451971047.35
Add: Changes of
accounting policy
19809442.95 1584556.37 21393999.32 21393999.32
Error correction
of the last period
Enterprise
combine under
the same control
Other
II. Balance at the
beginning of this
year
10089505
70.00
34160227
95.14
1618490.50
510100496.0
0
10998530426.50 15935222778.14 538142268.53 16473365046.67
III. Increase/
Decrease in this
year (Decrease is
listed with “-”)
-24494988.
81
134871.67 1629266.56 1077913209.06 1055182358.48 -43894094.48 1011288264.00
(i) Total
comprehensive
income
134871.67 2268026432.78 2268161304.45 34779060.52 2302940364.97
(ii) Owners’
devoted and
decreased capital
-24494988.
81
567732.83 -23927255.98 -52813665.23 -76740921.21
1.Common shares
invested by
shareholders
14022428.73 14022428.73
2. Capital
invested by
holders of other
equity
instruments
3. Amount
reckoned into
owners equity
with share-based
payment
4. Other
-24494988.
81
567732.83 -23927255.98 -66836093.96 -90763349.94
(III) Profit
distribution
-1210740684.00 -1210740684.00 -26271705.11 -1237012389.11
1. Withdrawal of
surplus reserves
2. Withdrawal of
general risk
provisions
3. Distribution for
owners (or
shareholders)
-1210740684.00 -1210740684.00 -26271705.11 -1237012389.11
4. Other
(IV) Carrying
forward internal
owners’ equity
1. Capital
reserves
conversed to
capital (share
capital)
2. Surplus
reserves
conversed to
capital (share
capital)
3. Remedying
loss with surplus
reserve
4．Carry-over
retained earnings
from the defined
benefit plans
5．Carry-over
retained earnings
from other
comprehensive
income
6. Other
(V) Reasonable
reserve
1061533.73 1061533.73 412215.34 1473749.07
1. Withdrawal in
the report period
19156254.11 19156254.11 2508506.58 21664760.69
2. Usage in the
report period
18094720.38 18094720.38 2096291.24 20191011.62
(VI)Others 20627460.28 20627460.28 20627460.28
IV. Balance at the
end of the report
period
10089505
70.00
33915278
06.33
134871.67 3247757.06
510100496.0
0
12076443635.56 16990405136.62 494248174.05 17484653310.67
8. Statement of Changes in Owners’ Equity (Parent Company)
Current Period
In RMB
Item
2020
Share capital
Other equity instrument
Capital public
reserve
Less: Inventory
shares
Other
comprehe
nsive
income
Reasonable
reserve
Surplus reserve Retained profit
Othe
r
Total owners’
equity
Preferred
stock
Perpetua
l capital
securitie
s
Other
I. Balance at the
end of the last year
1008950570.00 3488221286.39 510100496.00 10381863816.29 15389136168.68
Add: Changes of
accounting policy
Error correction of
the last period
Other
II. Balance at the
beginning of this
year
1008950570.00 3488221286.39 510100496.00 10381863816.29 15389136168.68
III. Increase/
Decrease in this
year (Decrease is
listed with “-”)
-80489269.78 303627977.74 1317119149.33 933001901.81
(i) Total 2474039407.01 2474039407.01
comprehensive
income
(ii) Owners’
devoted and
decreased capital
-80489269.78 303627977.74 -384117247.52
1.Common shares
invested by
shareholders
-96389202.59 302479200.00 -398868402.59
2. Capital invested
by holders of other
equity instruments
3. Amount
reckoned into
owners equity with
share-based
payment
6484837.50 6484837.50
4. Other 9415095.31 1148777.74 8266317.57
(III) Profit
distribution
-1093241270.00 -1093241270.00
1. Withdrawal of
surplus reserves
2. Distribution for
owners (or
shareholders)
-1093241270.00 -1093241270.00
3. Other
(IV) Carrying
forward internal
owners’ equity
1. Capital reserves
conversed to
capital (share
capital)
2. Surplus reserves
conversed to
capital (share
capital)
3. Remedying loss
with surplus
reserve
4．Carry-over
retained earnings
from the defined
benefit plans
5．Carry-over
retained earnings
from other
comprehensive
income
6. Other
(V) Reasonable
reserve
-1177442.02 -1177442.02
1. Withdrawal in
the report period
5849756.55 5849756.55
2. Usage in the
report period
7027198.57 7027198.57
(VI)Others 1177442.02 -63678987.68 -62501545.66
IV. Balance at the
end of the report
period
1008950570.00 3407732016.61 303627977.74 510100496.00 11698982965.62 16322138070.49
Last period
In RMB
Item
2019
Share capital
Other equity instrument
Capital public
reserve
Less:
Inventor
y shares
Other
comprehensive
income
Reasonable
reserve
Surplus reserve Retained profit
Othe
r
Total owners’
equity
Preferred
stock
Perpetual
capital
securities
Other
I. Balance at the end
of the last year
1008950570.00 3488221286.39 -19809442.95 510100496.00 9340610451.36 14328073360.80
Add: Changes of
accounting policy
19809442.95 1584556.37 21393999.32
Error correction of
the last period
Other
II. Balance at the
beginning of this
1008950570.00 3488221286.39 510100496.00 9342195007.73 14349467360.12
year
III. Increase/
Decrease in this
year (Decrease is
listed with “-”)
1039668808.56 1039668808.56
(i) Total
comprehensive
income
2229782032.28 2229782032.28
(ii) Owners’
devoted and
decreased capital
1.Common shares
invested by
shareholders
2. Capital invested
by holders of other
equity instruments
3. Amount reckoned
into owners equity
with share-based
payment
4. Other
(III) Profit
distribution
-1210740684.00 -1210740684.00
1. Withdrawal of
surplus reserves
2. Distribution for -1210740684.00 -1210740684.00
owners (or
shareholders)
3. Other
(IV) Carrying
forward internal
owners’ equity
1. Capital reserves
conversed to capital
(share capital)
2. Surplus reserves
conversed to capital
(share capital)
3. Remedying loss
with surplus reserve
4．Carry-over
retained earnings
from the defined
benefit plans
5．Carry-over
retained earnings
from other
comprehensive
income
6. Other
(V) Reasonable
reserve
1. Withdrawal in the
report period
5898191.19 5898191.19
2. Usage in the
report period
5898191.19 5898191.19
(VI)Others 20627460.28 20627460.28
IV. Balance at the
end of the report
period
1008950570.00 3488221286.39 510100496.00 10381863816.29 15389136168.68
III . Basic information of the Company
1. Historical origin of the Company
By the approval of STGS (1992) No. 130 issued by Jiangsu Economic Restructuring Committee Weifu
High-Technology Group Co. Ltd. (hereinafter referred to “the Company” or “Company”) was established as a
company of limited liability with funds raised from targeted sources and registered at Wuxi Administration for
Industry & Commerce in October 1992. The original share capital of the Company totaled 115.4355 million Yuan
including state-owned share capital amounting to 92.4355 million Yuan public corporate share capital amounting
to 8 million Yuan and inner employee share capital amounting to 15 million Yuan.
Between year of 1994 and 1995 the Company was restructured and became a holding subsidiary of Wuxi Weifu
Group Co. Ltd (hereinafter referred to as “Weifu Group”).
By the approval of Jiangsu ERC and Shenzhen Securities Administration Office in August 1995 the Company
issued 68 million special ordinary shares (B-share) with value of 1.00 Yuan for each and the total value of those
shares amounted to 68 million Yuan. After the issuance the Company’s total share capital increased to 183.4355
million Yuan.
By the approval of CSRC in June 1998 the Company issued 120 million RMB ordinary shares (A-share) at
Shenzhen Stock Exchange through on-line pricing and issuing. After the issuance the total share capital of the
Company amounted to 303.4355 million Yuan.
In the middle of 1999 deliberated and approved by the Board and Shareholders’ General Meeting the Company
implemented the plan of granting 3 bonus shares for each 10 shares. After that the total share capital of the
Company amounted to 394.46615 million Yuan of which state-owned shares amounted to 120.16615 million
Yuan public corporate shares 10.4 million Yuan foreign-funded shares (B-share) 88.40 million Yuan RMB
ordinary shares (A-share) 156 million Yuan and inner employee shares 19.5 million Yuan.In the year 2000 by the approval of the CSRC and based upon the total share capital of 303.4355 million shares
after the issuance of A-share in June 1998 the Company allotted 3 shares for each 10 shares with a price of 10
Yuan for each allotted share. Actually 41.9 million shares was allotted and the total share capital after the
allotment increased to 436.36615 million Yuan of which state-owned corporate shares amounted to 121.56615
million Yuan public corporate shares 10.4 million Yuan foreign-funded shares (B-share) 88.4 million Yuan and
RMB ordinary shares (A-share) 216 million Yuan.
In April 2005 Board of Directors of the Company has examined and approved 2004 Profit Pre-distribution Plan
and examined and approved by 2004 Shareholders’ General Meeting the Company distributed 3 shares for each
10 shares to the whole shareholders totaling to 130909845 shares in 2005.
According to the Share Merger Reform Scheme of the Company that passed by related shareholders’ meeting of
Share Merger Reform and SGZF [2006] No.61 Reply on Questions about State-owned Equity Management in
Share Merger Reform of Weifu High-Technology Co. Ltd. issued by State-owned Assets Supervision &
Administration Commission of Jiangsu Province the Weifu Group etc. 8 non-circulating shareholders arranged
pricing with granting 1.7 shares for each 10 shares to circulating A-share shareholders (totally granted 47736000
shares) so as to realize the originally non-circulating shares can be traded on market when satisfied certain
conditions the scheme has been implemented on April 5 2006.
On 27 May 2009 Weifu Group satisfied the consideration arrangement by dispatching 0.5 shares for each 10
shares based on the number of circulating A share as prior to Share Merger Reform according to the aforesaid
Share Merger Reform with an aggregate of 14039979 shares dispatched. Subsequent to implementation of
dispatch of consideration shares Weifu Group then held 100021999 shares of the Company representing 17.63%
of the total share capital of the Company.Pursuant to the document (XGZQ(2009)No.46) about Approval for Merger of Wuxi Weifu Group Co. Ltd. by
Wuxi Industry Development Group Co. Ltd. issued by the State-owned Assets Supervision and Administration
Commission of Wuxi City Government Wuxi Industry Development Group Co. Ltd. (hereinafter referred to as
Wuxi Industry Group) acquired Weifu Group. After the merger Weifu Group was then revoked and its assets and
credits & debts were transferred to be under the name of Wuxi Industry Group. Accordingly Wuxi Industry
Group became the first largest shareholder of the Company since then.In accordance with the resolutions of shareholders' meeting and provisions of amended constitution and approved
by [2012] No. 109 document of China Securities Regulatory Commission in February 2012 the Company issued
RMB ordinary shares (A-share) of 112858000 shares to Wuxi Industry Groups and overseas strategic investor
privately Robert Bosch Co. Ltd. (ROBERT BOSCHGMBH) (hereinafter referred to as Robert Bosch Company)
face value was ONE Yuan per share added registered capital of 112858000Yuan and the registered capital after
change was 680133995Yuan. Wuxi Industry Group is the first majority shareholder of the Company and Robert
Bosch Company is the second majority shareholder of the Company.
In March 2013 the profit distribution pre-plan for year of 2012 was deliberated and approved by the Board and
also passed in Annual General Meeting 2012 of the Company in May 2013. On basis of total share capital
680133995 shares distribute 5-share for every 10 shares held by whole shareholders 340066997 shares in total
are distributed. Total share capital of the Company amounting 1020200992Yuan up to 31 December 2013.Deliberated and approved by the company’s first extraordinary general meeting in 2015 the company has
repurchased 11250422 shares of A shares from August 26 2015 to September 8 2015 and has finished the
cancellation procedures for above repurchase shares in China Securities Depository and Clearing Corporation
Limited Shenzhen Branch on September 16 2015; after the cancellation of repurchase shares the company’s
paid-up capital (share capital) becomes 1008950570 Yuan after the change.
2. Registered place organization structure and head office of the Company
Registered place and head office of the Company: No.5 Huashan Road Xinwu District Wuxi
Unified social credit code: 91320200250456967N
The Company sets up Shareholders’ General Meeting the Board of Directors (BOD) and the Board of Supervisors
(BOS)
The Company sets up Administration Department Technology Centre organization & personnel department
Office of the Board compliance department IT department Strategy & new business Department market
development department Party-massesDepartment Finance Department Purchase DepartmentManufacturing
Quality Department MS (Mechanical System) division AC(Automobile Components) divisionand DS (Diesel
System ) division etc. and subsidiaries such as Wuxi Weifu Leader Catalytic Converter Co. Ltd. Nanjing Weifu
Jinning Co. Ltd. IRD Fuel Cells A/S and Borit NV etc.
3. Business nature and major operation activities of the Company
Operation scope of parent company: Technology development and consulting service in the machinery industry;
manufacture of engine fuel oil system products fuel oil system testers and equipment manufacturing of auto
electronic parts automotive electrical components non-standard equipment non-standard knife tool and exhaust
after-treatment system; sales of the general machinery hardware & electrical equipment chemical products & raw
materials (excluding hazardous chemicals) automobile components and vehicles (excluding nine-seat passenger
car); internal combustion engine maintenance; leasing of the own houses; import and export business in respect of
diversified commodities and technologies (other than those commodities and technologies limited or forbidden by
the State for import and export) by self-operation and works as agent for such business. Research and test
development of engineering and technical; R&D of the energy recovery system; manufacture of auto components
and accessories; general equipment manufacturing (excluding special equipment manufacturing) (any projects
that needs to be approved by laws can only be carried out after getting approval by relevant authorities)
Major subsidiaries respectively activate in production and sales of engine accessories automobile components
mufflers purifiers and fuel cell components etc.
4. Relevant party offering approval reporting of financial statements and date thereof
Financial statements of the Company were approved by the Board of Directors for reporting dated 16 April 2021.
5. Scope of consolidate financial statement
Name of subsidiary
Short name
of subsidiary
Shareholding ratio
(%) Proportion
of votes
(%)
Registered
capital
(in 10
thousand
Yuan)
Business scope
Statement
consolidate
(Y/N) Directly Indirectly
Nanjing Weifu Jinning Co. Ltd.Weifu
Jinning
80.00 -- 80.00 34628.70
Internal-combustion
engine accessories
Y
Wuxi Weifu Leader Catalytic Converter
Co. Ltd.
Weifu
Leader
94.81 -- 94.81 50259.63 Purifier and muffler Y
Weifu Mashan Pump Glib Co. Ltd.Weifu
Mashan
100.00 -- 100.00 16500
Internal-combustion
engine accessories
Y
Wuxi Weifu Chang’an Co. Ltd.Weifu
Chang’an
100.00 -- 100.00 21000
Internal-combustion
engine accessories
Y
Wuxi Weifu International Trade Co. Ltd.Weifu
International
Trade
100.00 -- 100.00 3000 Trade Y
Wuxi Weifu Schmidt Power System Spare
Parts Co. Ltd.Weifu
Schmidt
66.00 -- 66.00 7600
Internal-combustion
engine accessories
Y
Ningbo Weifu Tianli Supercharging
Technique Co. Ltd.Weifu Tianli 98.83 1.17 100.00 11136
Internal-combustion
engine accessories
Y
Wuxi Weifu Autocam Fine Machinery Co.Ltd.Weifu
Autocam
51.00 -- 51.00 USD2110
Automobile
components
Y
Wuxi Weifu Leader Catalytic Purifier
(Wuhan) Co. Ltd.Weifu
Leader
(Wuhan)
-- 60.00 60.00 1000 Purifier and muffler Y
Weifu Leader (Chongqing)Automobile
components Co. Ltd.Weifu
Leader
(Chongqing)
-- 100.00 100.00 5000 Purifier and muffler Y
Nanchang Weifu Leader Automobile
Components Co. Ltd
Weifu
Leader
(Nanchang)
-- 100.00 100.00 5000 Purifier and muffler Y
Wuxi Weifu Autosmart Seating System
Co. Ltd.
Autosmart
Seating t
-- 66.00 66.00 10000 Smart car device Y
Wuxi Weifu Electric Drive Technology
Co. Ltd.
Weifu
Electric
Drive
80.00 -- 80.00 USD2000 Wheel motor Y
Weifu Holding ApS SPV 100.00 -- 100.00 DKK 38 Investment Y
IRD Fuel Cells A/S IRD -- 100.00 100.00 DKK8560
Fuel cell
components
Y
IRD FUEL CELLS LLC IRDAmerica -- 100.00 100.00 USD300
Fuel cell
components
Y
Borit NV Borit -- 100.00 100.00 EURO316.09
Fuel cell
components
Y
Borit Inc. Borit Inc. -- 100.00 100.00 USD0.1
Fuel cell
components
Y
Compared with the previous period the scope of consolidated financial statement have increase the follow enterprises including
Zhixing Seat Borit and Borit Inc. Of which the Autosmart Seating was the subsidiary jointly established by the Company and
Qiqiong Automobile Technology (Shanghai) Co. Ltd. Found more in the description of 5. Other reasons of change of consolidation
scope carried in Note VI; Borit is the subsidiary acquired in the Period through SPV found more in the description of 1.Enterprise
combine not under the same control carried in Note VI; and Borit Inc. is the wholly-owned subsidiary of Borit established in the
U.S.A.
On 1 January 2020 the former wholly-owned subsidiary - Wuxi Weifu ITM Supercharging Technique Co. Ltd was merger by
absorption.IV. Basis of preparation of financial statements
1. Preparation base
The financial statement were stated in compliance with Accounting Standard for Business Enterprises –Basic
Norms issued by Ministry of Finance the specific 42 accounting rules revised and issued dated 15 February 2006
and later the Application Instruments of Accounting Standards and interpretation on Accounting standards and
other relevant regulations (together as “Accounting Standards for Business Enterprise”) as well as the
Compilation Rules for Information Disclosure by Companies Offering Securities to the Public No.15 – General
Provision of Financial Report (Amended in 2014) issued by CSRC in respect of the actual transactions and
proceedings on a basis of ongoing operation.In line with relevant regulations of Accounting Standards of Business Enterprise accounting of the Company is
on accrual basis. Except for certain financial instruments the financial statement measured on historical cost.
Assets have impairment been found corresponding depreciation reserves shall accrual according to relevant rules.
2. Going concern
The Company comprehensively assessed the available information and there are no obvious factors that impact
sustainable operation ability of the Company within 12 months since end of the reporting period.V. Major Accounting Policies and Estimation
Specific accounting policies and estimation attention:
The Company and its subsidiaries are mainly engaged in the manufacture and sales of engine fuel oil system
products automobile components mufflers purifiers and fuel cell components etc. in line with the real
operational characteristics and relevant accounting standards many specific accounting policies and estimation
have been formulated for the transactions and events with revenue recognized concerned. As for the explanation
on major accounting judgment and estimation made by management please refer to Note V 34 "Other major
accounting policies and estimation ".
1. Statement on observation of Accounting Standard for Business Enterprises
Financial statements prepared by the Company were in accordance with requirements of Accounting Standard for
Business Enterprises which truly and completely reflected the financial information of the Company dated 31
December 2020 such as financial status operation achievements and cash flow for the year of 2020.
2. Accounting period
Accounting period of the Company consist of annual and mid-term mid-term refers to the reporting period shorter
than one annual accounting year. The company adopts Gregorian calendar as accounting period namely form each
1 January to 31 December.
3. Business cycles
Normal business cycle is the period from purchasing assets used for process by the Company to the cash and cash
equivalent achieved. The Company’s normal business cycle was one-year (12 months).
4. Recording currency
The Company’s reporting currency is the RMB Yuan.
5. Accounting Treatment Method for Business Combinations under the same/different control
Business combination is the transaction or events that two or two above independent enterprises combined as a
reporting entity. Business combination including enterprise combined under the same control and business
combined under different control.
(1) The business combination under the same control
Enterprise combination under the same control is the enterprise who take part in the combination are have the
same ultimate controller or under the same controller the control is not temporary. The assets and liability
acquired by combining party are measured by book value of the combined party on combination date. Balance of
net asset’s book value acquired by combining party and combine consideration paid (or total book value of the
shares issued) shall adjusted capital reserve (share premium); if the capital reserves (share premium) is not
enough for deducted adjusted for retained earnings. Vary directly expenses occurred for enterprise combination
the combining party shall reckoned into current gains/losses while occurring. Combination day is the date when
combining party obtained controlling rights from the combined party.(2) Combine not under the same control
A business combination not involving entities under common control is a business combination in which all of the
combining entities are not ultimately controlled by the same party or parties both before and after the
combination.As a purchaser fair value of the assets (equity of purchaser held before the date of purchasing
included) for purchasing controlling right from the purchaser the liability occurred or undertake on purchasing
date less the fair value of identifiable net assets of the purchaser obtained in combination recognized as goodwill
if the results is positive; if the number is negative the acquirer shall firstly review the measurement of the fair
value of the identifiable assets obtained liabilities incurred and contingent liabilities incurred as well as the
combination costs.After that if the combination costs are still lower than the fair value of the identifiable net
assets obtained the acquirer shall recognize the difference as the profit or loss in the current period.Other directly
expenses cost for combination shall be reckoned into current gains/losses. Difference of the fair value of assets
paid and its book values reckoned into current gains/losses. On purchasing date the identifiable assets liability or
contingency of the purchaser obtained by the Company recognized by fair value that required identification
conditions; Acquisition date refers to the date on which the acquirer effectively obtains control of the purchaser.
6. Preparation method for consolidated financial statement
(1) Recognition principle of consolidated scope
On basis of the financial statement of the parent company and owned subsidiaries prepared consolidated
statement in line with relevant information. The scope of consolidation of consolidated financial statements is
ascertained on the basis of effective control. Once certain elements involved in the above definition of control
change due to changes of relevant facts or circumstances the Company will make separate assessment.
(2) Basis of control
Control is the right to govern an invested party so as to obtain variable return through participating in the invested
party’s relevant activities and the ability to affect such return by use of the aforesaid right over the invested
party.Relevant activates refers to activates have major influence on return of the invested party’s.
(3) Consolidation process
Subsidiaries are consolidated from the date on which the company obtains their actual control and are
de-consolidated from the date that such control ceases.All significant inter-group balances investment
transactions and unrealized profits are eliminated in the consolidated financial statements.For subsidiaries being
disposed the operating results and cash flows prior to the date of disposal are included in the consolidated income
statement and consolidated cash flow statement; for subsidiaries disposed during the period the opening balances
of the consolidated balance sheet would not be restated. For subsidiaries acquired from a business combination
not under common control their operating results and cash flows subsequent to the acquisition date are included
in the consolidated income statement and consolidated cash flow statement and the opening balances and
comparative figures of the consolidated balance sheet would not be restated. For subsidiaries acquired from a
business combination under common control their operating results and cash flows from the date of
commencement of the accounting period in which the combination occurred to the date of combination are
included in the consolidated income statement and consolidated cash flow statement and the comparative figures
of the consolidated balance sheet would be restated.In preparing the consolidated financial statements where the accounting policies or the accounting periods are
inconsistent between the company and subsidiaries the financial statements of subsidiaries are adjusted in
accordance with the accounting policies and accounting period of the company.
Concerning the subsidiary obtained under combination with different control adjusted several financial statement
of the subsidiary based on the fair value of recognizable net assets on purchased day while financial statement
consolidation; concerning the subsidiary obtained under combination with same control considered current status
of being control by ultimate controller for consolidation while financial statement consolidation.The unrealized gains and losses from the internal transactions occurred in the assets the Company sold to the
subsidiaries fully offset "the net profit attributable to the owners of the parent company". The unrealized gains and
losses from the internal transactions occurred in the assets the subsidiaries sold to the Company are distributed and
offset between "the net profit attributable to the owners of the parent company" and "minority interest" according
to the distribution ratio of the Company to the subsidiary. The unrealized gains and losses from the internal
transactions occurred in the assets sold among the subsidiaries are distributed and offset between "the net profit
attributable to the owners of the parent company" and "minority interest" according to the distribution ratio of the
Company to the subsidiary of the seller.
The share of the subsidiary’s ownership interest not attributable to the Company is listed as “minority interest”
item under the ownership interest in the consolidated balance sheet. The share of the subsidiary’s current profit or
loss attributable to the minority interests is listed as "minority interest" item under the net profit item in the
consolidated income statement. The share of the subsidiary’s current consolidated income attributable to the
minority interests is listed as the “total consolidated income attributable to the minority shareholders” item under
the total consolidated income item in the consolidated income statement. If there are minority shareholders add
the "minority interests" item in the consolidated statement of change in equity to reflect the changes of the
minority interests. If the losses of the current period shared by a subsidiary’s minority shareholders exceed the
share that the minority shareholders hold in the subsidiary ownership interest in the beginning of the period the
balance still charges against the minority interests.When the control over a subsidiary is ceased due to disposal of a portion of an interest in a subsidiary the fair
value of the remaining equity interest is re-measured on the date when the control ceased. The difference between
the sum of the consideration received from disposal of equity interest and the fair value of the remaining equity
interest less the net assets attributable to the company since the acquisition date is recognized as the investment
income from the loss of control. Other comprehensive income relating to original equity investment in
subsidiaries shall be treated on the same basis as if the relevant assets or liabilities were disposed of by the
purchaser directly when the control is lost namely be transferred to current investment income other than the
relevant part of the movement arising from re-measuring net liabilities or net assets under defined benefit scheme
by the original subsidiary. Subsequent measurement of the remaining equity interests shall be in accordance with
relevant accounting standards such as Accounting Standards for business Enterprises 2 – Long-term Equity
Investments or Accounting Standards for business Enterprises 22 – Financial Instruments Recognition and
Measurement.The company shall determine whether loss of control arising from disposal in a series of transactions should be
regarded as a bundle of transactions. When the economic effects and terms and conditions of the disposal
transactions met one or more of the following situations the transactions shall normally be accounted for as a
bundle of transactions: ①The transactions are entered into after considering the mutual consequences of each
individual transaction; ② The transactions need to be considered as a whole in order to achieve a deal in
commercial sense;③The occurrence of an individual transaction depends on the occurrence of one or more
individual transactions in the series; ④ The result of an individual transaction is not economical but it would be
economical after taking into account of other transactions in the series. When the transactions are not regarded asa bundle of transactions the individual transactions shall be accounted as “disposal of a portion of an interest in asubsidiary which does not lead to loss of control” and “disposal of a portion of an interest in a subsidiary whichlead to loss of control”. When the transactions are regarded as a bundle of transactions the transactions shall be
accounted as a single disposal transaction; however the difference between the consideration received from
disposal and the share of net assets disposed in each individual transactions before loss of control shall be
recognized as other comprehensive income and reclassified as profit or loss arising from the loss of control when
control is lost.
7. Joint arrangement classification and accounting treatment for joint operations
In accordance with the Company’s rights and obligation under a joint arrangement the Company classifies joint
arrangements into: joint ventures and joint operations.The company confirms the following items related to the share of interests in its joint operations and in
accordance with the provisions of the relevant accounting standards for accounting treatment:
(1) Recognize the assets held solely by the Company and recognize assets held jointly by the Company in
appropriation to the share of the Company;
(2) Recognize the obligations assumed solely by the Company and recognize obligations assumed jointly by the
Company in appropriation to the share of the Company;
(3) Recognize revenue from disposal of the share of joint operations of the Company;
(4) Recognize fees solely occurred by Company;
(5) Recognize fees from joint operations in appropriation to the share of the Company.
8. Recognition standards for cash and cash equivalent
Cash refers to stock cash savings available for paid at any time; cash and cash equivalent refers to the cash held
by the Company with short terms(expired within 3 months since purchased) and liquid and easy to transfer as
known amount and investment with minor variation in risks.
9. Foreign currency business and conversion
The occurred foreign currency transactions are converted into the recording currency in accordance with the
middle rate of the market exchange rate published by the People's Bank of China on the transaction date. Thereinto
the occurred foreign currency exchange or transactions involved in the foreign currency exchange are converted in
accordance with the actual exchange rate in the transactions.
At the balance sheet date the account balance of the foreign currency monetary assets and liabilities is converted
into the recording currency amount in accordance with the middle rate of the market exchange rate published by
the People's Bank of China on the transaction date. The balance between the recording currency amount converted
according to exchange rate at the balance sheet date and the original recording currency amount is disposed as the
exchange gains or losses. Thereinto the exchange gains or losses occurred in the foreign currency loans related to
the purchase and construction of fixed assets are disposed according to the principle of capitalization of borrowing
costs; the exchange gains and losses occurred during the start-up are included in the start-up costs; the rest is
included in the current financial expenses.
At the balance sheet date the foreign currency non-monetary items measured with the historical costs are
converted in accordance with the middle rate of the market exchange rate published by the People's Bank of China
on the transaction date without changing its original recording currency amount; the foreign currency non-monetary
items measured with the fair value are converted in accordance with the middle rate of the market exchange rate
published by the People's Bank of China on the fair value dateand the generated exchange gains and losses are
included in the current profits and losses as the gains and losses from changes in fair value.The following displays the methods for translating financial statements involving foreign operations into the
statements in RMB: The asset and liability items in the balance sheets for overseas operations are translated at the
spot exchange rates on the balance sheet date. Among the owners’ equity items the items other than
“undistributed profits” are translated at the spot exchange rates of the transaction dates. The income and expense
items in the income statements of overseas operations are translated at the average exchange rates of the
transaction dates.The exchange difference arising from the above mentioned translation are recognized in other
comprehensive income and is shown separately under owner’ equity in the balance sheet; such exchange
difference will be reclassified to profit or loss in current year when the foreign operation is disposed according to
the proportion of disposal.The cash flows of overseas operations are translated at the average exchange rates on the dates of the cash flows.The effect of exchange rate changes on cash is presented separately in the cash flow statement.
10. Financial instrument
Financial instrument is the contract that taken shape of the financial asses for an enterprise and of the financial
liability or equity instrument for other units.
(1) Recognition and termination of financial instrument
A financial asset or liability is recognized when the group becomes a party to a financial instrument contract.
The recognition of a financial assets shall be terminated if it meets one of the following conditions:
① the contractual right to receive the cash flow of the financial assets terminates; and
② the financial assets is transferred and the company transfers substantially all the risks and rewards of ownership
of the financial asset to the transferring party;
③the financial asset was transferred and control although the company has neither transferred nor retained almost
all the risks and rewards of the ownership of a financial asset it relinquishes control over the financial asset.If all or part of the current obligations of a financial liability has been discharged the financial liability or part of it
is terminated for recognition. When the Company (debtor) and the creditor sign an agreement to replace the existing
financial liabilities with new financial liabilities and the new financial liabilities and the existing financial liabilities
are substantially different from the contract terms terminated the recognition of the existing financial liabilities and
recognize the new financial liabilities at the same time.
Financial assets are traded in the normal way and their accounting recognition and terminated the recognition of
proceed on a trade date basis.
(2) Classification and measurement of financial assets
At the initial recognition according to the business model of managing financial assets and the contractual cash
flow characteristics of financial assets the Company classifies the financial assets into the financial assets
measured at amortized cost the financial assets measured at fair value and whose changes are included in other
comprehensive income and the financial assets measured at fair value and whose changes are included in current
profit or loss. Financial assets are measured at fair value at initial recognition but if the receivables or receivables
financing arising from the sale of goods or the provision of services do not include a significant financing
component or do not consider a financing component that does not exceed one year it shall be initially measured
in accordance with the transaction value. For financial assets measured at fair value and whose changes are
included in the current profit or loss related transaction costs are directly included in the current profit and loss;
for other types of financial assets related transaction costs are included in the initially recognized amount.The business model for managing financial assets refers to how the Company manages financial assets to generate
cash flows. The business model determines whether the cash flow of financial assets managed by the Company is
based on contract cash flow selling financial assets or both. The Company determines the business model for
managing financial assets based on objective facts and based on the specific business objectives of financial assets
management determined by key management personnel.The Company evaluates the contractual cash flow characteristics of financial assets to determine whether the
contractual cash flows generated by the relevant financial assets on a specific date are only payments for the
principal and the interest based on the outstanding principal amount. The principal is the fair value of the financial
assets at initial recognition; the interest includes the time value of money the credit risk associated with the
outstanding principal amount for a specific period and other basic borrowing risks costs and consideration of profit.In addition the Company evaluates the contractual terms that may result in changes in the time distribution or the
amount of contractual cash flows of the financial assets to determine whether they meet the requirements of the
above contractual cash flow characteristics.Only when the Company changes its business model of managing financial assets all affected financial assets are
reclassified on the first day of the first reporting period after the business model changes otherwise the financial
assets are not allowed to be reclassified after initial recognition.
① Financial assets measured at amortized cost
The Company classifies the financial assets that meet the following conditions and haven’t been designated as
financial assets measured at fair value and whose changes are included in current profit or loss as financial assets
measured at amortized cost:
A. the group's business model for managing the financial assets is to collect contractual cash flows; and
B. the contractual terms of the financial assets stipulate that cash flow generated on a specific date is only paid for
the principal and interest based on the outstanding principal amount.
After initial recognition such financial assets are measured at amortized cost by using the effective interest method.
Gains or losses arising from financial assets which are measured at amortized cost and are not a component of any
hedging relationship are included in current profit or loss when being terminated for recognition amortized by
effective interest method or impaired.
② Financial assets measured at fair value and whose changes are included in other comprehensive income
The Company classifies the financial assets that meet the following conditions and haven’t been designated as
financial assets measured at fair value and whose changes are included in current profit or loss as financial assets
measured at fair value and whose changes are included in other comprehensive income:
A. the Group's business model for managing the financial assets is targeted at both the collection of contractual
cash flows and the sale of financial assets; and
B. the contractual terms of the financial asset stipulate that the cash flow generated on a specific date is only the
payment of the principal and the interest based on the outstanding principal amount.
After initial recognition such financial assets are subsequently measured at fair value. Interests impairment losses
or gains and exchange gains and losses calculated by using the effective interest method are included in profit or loss
for the period and other gains or losses are included in other comprehensive income. When being terminate for
recognition the accumulated gains or losses previously included in other comprehensive income are transferred
from other comprehensive income and included in current profit or loss.
③Financial assets measured at fair value and whose changes are included in current profit or loss
Except for the above financial assets measured at amortized cost and measured at fair value and whose changes are
included in other comprehensive income the Company classifies all other financial assets as financial assets
measured at fair value and whose changes are included in current profit or loss. In the initial recognition in order to
eliminate or significantly reduce accounting mismatch the Company irreversibly designates part of the financial
assets that should be measured at amortized cost or measured at fair value and whose changes are included in the
other comprehensive income as the financial assets measured at fair value and whose changes are included in
current profit or loss.
After the initial recognition such financial assets are subsequently measured at fair value and the gains or losses
(including interests and dividend income) are included in the current profit and loss unless the financial assets are
part of the hedging relationship.However for non-trading equity instrument investments the Company irreversibly designates them as the financial
assets that are measured at fair value and whose changes are included in other comprehensive income in the initial
recognition. The designation is made based on a single investment and the relevant investment is in line with the
definition of equity instruments from the issuer's perspective. After initial recognition such financial assets are
subsequently measured at fair value. Dividend income that meets the conditions is included in profit or loss and
other gains or losses and changes in fair value are included in other comprehensive income. When it is terminated
for recognition the accumulated gains or losses previously included in other comprehensive income are transferred
from other comprehensive income and included in retained earnings.
(3) Classification and measurement of financial liabilities
The financial liabilities of the Company are classified as financial liabilities measured at fair value and whose
changes are included in current profit or loss and financial liabilities measured at amortized cost at the initial
recognition. For financial liabilities that are not classified as financial liabilities measured at fair value and whose
changes are included in current profit or loss the related transaction expenses are included in the initial recognition
amount.
①Financial liability measured by fair value and with variation reckoned into current gains/losses
Financial liability measured by fair value and with variation reckoned into current gains/losses including tradable
financial liability and the financial liabilities that are designated as fair value in the initial recognition and whose
changes are included in current profit or loss. For such financial liabilities the subsequent measurement is based on
fair value and the gains or losses arising from changes in fair value and the dividends and interest expenses related
to these financial liabilities are included in current profit or loss.
②Financial liability measured by amortized cost
Other financial liabilities are subsequently measured at amortized cost by using the effective interest method. The
gain or loss arising from recognition termination or amortization is included in current profit or loss.
③Distinctions between financial liabilities and equity instruments
Financial liabilities are liabilities that meet one of the following conditions:
A. Contractual obligations to deliver cash or other financial assets to other parties.
B. Contractual obligations to exchange financial assets or financial liabilities with other parties under potentially
adverse conditions.
C. Non-derivative contracts that must be settled or that can be settled by the company's own equity instruments in
the future and the enterprise will deliver a variable amount of its own equity instruments according to the contract.
D. Derivative contracts that must be settled or that can be settled by the company's own equity instruments in the
future except for derivatives contracts that exchange a fixed amount of cash or other financial assets with a fixed
amount of their own equity instruments.
An equity instrument is a contract that proves it has a residual equity in the assets of an enterprise after deducting all
liabilities.If the Company cannot unconditionally avoid performing a contractual obligation by delivering cash or other
financial assets the contractual obligation is consistent with the definition of financial liability.If a financial instrument is required to be settled or can be settled by the Company's own equity instruments it is
necessary to consider whether the Company's own equity instruments used to settle the instrument are a substitute
for cash or other financial assets or to make the instrument holder enjoy the residual equity in the assets of the issuer
after deducting all liabilities. In the former case the instrument is the Company's financial liability; if it is the latter
the instrument is the Company's equity instrument.(4) Fair value of financial instruments
The company uses valuation techniques that are applicable under current circumstances and that have sufficient
available data and other information support to determine the fair value of related financial assets and financial
liabilities. The company divides the input values used by valuation techniques into the following levels and uses
them in sequence:
① The first-level input value is the unadjusted quotation of the same assets or liabilities that can be obtained on the
measurement date in the active market;
② The second-level input value is the direct or indirect observable input value of the relevant assets or liabilities
other than the first-level input value including quotations of similar assets or liabilities in an active market;
quotations of same or similar assets or liabilities in an active market; other observable input value other than
quotations such as interest rate and yield curves that are observable during the normal quote interval;
market-validated input value etc.;
③ The third-level input value is the unobservable input value of the relevant assets or liabilities including the
interest rate that cannot be directly observed or cannot be verified by observable market data stock volatility future
cash flow of the retirement obligation assumed in the business combination and financial forecasting made by its
own data etc.
(5) Impairment of financial assets
On the basis of expected credit losses the Company performs impairment treatment on financial assets measured
at amortized cost and creditors’ investment etc. measured at fair value and whose changes are included in other
comprehensive income and recognize the provisions for loss.①Measurement of expected credit losses
Expected credit loss refers to the weighted average of credit losses of financial instruments weighted by the risk of
default. Credit loss refers to the difference between all contractual cash flows that the Company discounts at the
original actual interest rate and are receivable in accordance with contract and all cash flows expected to be
received that is the present value of all cash shortages. Among them for the purchase or source of financial
assets that have suffered credit impairment the Company discounts the financial assets at the actual interest rate
adjusted by credit.When measuring expected credit losses the Company individually evaluates credit risk for financial assets with
significantly different credit risks such as receivables involving litigation and arbitration with the other party or
receivables having obvious indications that the debtor is likely to be unable to fulfill its repayment obligations
and so on.Except for the financial assets that separately assess the credit risks the Company classified the account
receivable according to their characteristic of risks calculated the expected credit losses on basis of portfolio.
Basis for determining the portfolio as follow:
A - Note receivable
Note receivable 1: bank acceptance
Note receivable 2: trade acceptance
B - Account receivable
Account receivable 1: receivable from clients
Account receivable 2: receivable from internal related party
C- Receivables financing
Note receivable financing 1: bank acceptance
Note receivable financing 2: trade acceptance
D - Other account receivables
Other account receivables 1: receivable from internal related party
Other account receivables 2: receivable from others
As for the note receivable account receivable receivables financing and other account receivable classified in
portfolio by referring to the experience of historical credit loss the expected credit loss is calculated by
combining the current situation and the forecast of future economic conditions.
Except for the above-mentioned financial assets adopting simplified metering method the Company assesses at
each balance sheet date whether its credit risk has increased significantly since initial recognition. If credit risk has
not increased significantly since initial recognition it is in the first stage the Company measures the loss
provisions based on the amount equivalent to the expected credit loss in the next 12 months; if the credit risk has
increased significantly since initial recognition but no credit impairment has occurred it is in the second stage the
Companymeasures the loss provisions based on the amount equivalent to the expected credit loss for the entire
duration; if credit impairment occurs after initial recognition it is in the third stage the Companymeasures the
loss provisions based on the amount equivalent to the expected credit loss for the entire duration.For financial
instruments with low credit risks at the balance sheet date the Company assumes that their credit risks have not
increased significantly since initial recognition.The Company evaluates the expected credit losses of financial instruments based on individual items and
portfolios. When assessing expected credit losses the Company considers reasonable and evidence-based
information about past events current conditions and forecasts of future economic conditions.When the Company no longer reasonably expects to be able to fully or partially recover the contractual cash flow
of a financial asset the Company directly writes down the book balance of the financial asset.
②Assessment of a significant increase in credit risk:
The Company determines the relative changes in default risk of the financial instrument occurred in the expected
duration and assess whether the credit risks of financial instrument has increased significantly since the initial
recognition by comparing the risk of default of the financial instrument on the balance sheet date with the risk of
default of financial instrument on the initial recognition date. When determining whether the credit risk has
increased significantly since the initial recognition the Company considers reasonable and evidence-based
information that can be obtained without unnecessary additional costs or effort including forward-looking
information. The information considered by the Company includes:
A. The debtor fails to pay the principal and interest according to the contractual maturity date;
B. Serious worsening of external or internal credit rating (if any) of the financial instruments that have occurred or
are expected;
C. Serious deterioration of the debtor’s operating results that have occurred or are expected;
D. Changes in existing or anticipated technical market economic or legal circumstances that will have a material
adverse effect on the debtor's ability to repay the company.
Based on the nature of financial instruments the Company assesses whether credit risk has increased significantly
on the basis of a single financial instrument or combination of financial instruments. When conducting an
assessment based on a combination of financial instruments the Company can classify financial instruments based
on common credit risk characteristics such as overdue information and credit risk ratings.The Company believes that financial assets are subject to default in the following circumstances:
The debtor is unlikely to pay the full amount to the Company and the assessment does not consider the Company to
take recourse actions such as realizing collateral (if held).
③Financial assets with credit impairment
On the balance sheet date the Company assesses whether the credit of financial assets measured at amortized cost
and the credit of debt investments measured at fair value and whose changes are included in other comprehensive
income has been impaired. When one or more events that adversely affect the expected future cash flows of a
financial asset occur the financial asset becomes a financial asset that has suffered credit impairment. Evidence that
credit impairment has occurred in financial assets includes the following observable information:
A. The issuer or the debtor has significant financial difficulties;
B. The debtor breaches the contract such as default or overdue repayment of interest or principal;
C. The Company gives concessions to the debtor that will not be made in any other circumstances for economic or
contractual considerations relating to the financial difficulties of the debtor;
D. The debtor is likely to go bankrupt or carry out other financial restructurings;
E. The financial difficulties of the issuer or the debtor have caused the active market of the financial asset to
disappear.④Presentation of expected credit loss provisions
In order to reflect the changes in the credit risk of financial instruments since the initial recognition the Company
re-measures the expected credit losses on each balance sheet date and the resulting increase or reversal of the loss
provisions shall be included in current profit and loss as impairment losses or gains. For financial assets measured at
amortized cost the loss provisions are written off against the book value of the financial assets listed in the balance
sheet; for debt investments measured at fair value and whose changes are included in other comprehensive income
the Company recognizes the loss provisions in other comprehensive income and does not deduct the book value of
the financial asset.⑤Write-off
If the Company no longer reasonably expects that the financial asset contract cash flow can be fully or partially
recovered directly write down the book balance of the financial asset. Such write-downs constitute the termination
of recognition for related financial assets. This usually occurs when the Company determines that the debtor has no
assets or sources of income to generate sufficient cash flow to repay the amount that will be written down. However
according to the Company's procedures for recovering the due amount the financial assets that have been written
down may still be affected by the execution activities.If the financial assets that have been written down are recovered afterwards they shall be included in the profit or
loss of the period being recovered as the reversal of the impairment loss
(6) Transfer of financial assets
The transfer of financial assets refers to the transfer or delivery of financial assets to the other party (the transferee)
other than the issuer of the financial assets.
For financial assets that the Company has transferred almost all risks and rewards of ownership of financial assets to
the transferee terminate the recognition of the financial assets; if almost all the risks and rewards of ownership of
financial assets have been retained do not terminate the recognition of the financial assets.If the Company has neither transferred nor retained almost all the risks and rewards of ownership of financial assets
dispose as following situations: If the control of the financial assets is abandoned terminate the recognition of the
financial assets and determine the resulting assets and liabilities. If the control of the financial assets is not
abandoned determine the relevant financial assets according to the extent to which they continue to be involved in
the transferred financial assets and determine the related liabilities accordingly.
(7) Balance-out between the financial assets and liabilities
As the Group has the legal right to balance out the financial liabilities by the net or liquidation of the financial
assets the balance-out sum between the financial assets and liabilities is listed in the balance sheet. In addition
the financial assets and liabilities are listed in the balance sheet without being balanced out.
11.Note receivable
Note receivable 1: bank acceptance
Note receivable 2: trade acceptance
The Company calculates expected credit losses by referring to historical credit loss experience taking into
account current conditions and forecasts of the future economic situation.
12.Account receivable
Account receivable 1: receivable from clients
Account receivable 2: receivable from internal related party
The Company calculates expected credit losses by referring to historical credit loss experience taking into
account current conditions and forecasts of the future economic situation.
13.Receivables financing
The note receivable and account receivable which are measured at fair value and whose changes are included in
other comprehensive income are classified as receivables financing within one year(including one year) from the
date of acquisition. Relevant accounting policy found more in 10. Financial Instrument in Note V.
14.Other account receivables
Determination method of expected credit loss and accounting treatment
Other account receivables 1: receivable from internal related party
Other account receivables 2: receivable from others
The Company calculates expected credit losses by referring to historical credit loss experience taking into
account current conditions and forecasts of the future economic situation.
15.Inventory
(1) Classification of inventories
The Company’s inventories are categorized into stock materials product in process and stock goods etc.
(2) Pricing for delivered inventories
The cost of inventory at the time of acquisition and delivery is calculated according to the standard cost method
and the difference in cost that it should bear is carried forward at the end of the period and the standard cost is
adjusted to the actual cost.
(3) Recognition evidence for net realizable value of inventories and withdrawal method for inventory impairment
provision
Inventories as at period-end are priced at the lower of costs and net realizable values; at period end on the basis of
overall clearance about inventories inventory impairment provision is withdrew for uncollectible part of costs of
inventories which result from destroy of inventories out-of-time of all and part inventories or sales price
lowering than cost. Inventory impairment provision for stock goods and quantity of raw materials is subject to the
difference between costs of single inventory item over its net realizable value. As for other raw materials with
large quantity and comparatively low unit prices inventory impairment provision is withdrawn pursuant to
categories.
As for finished goods commodities and materials available for direct sales their net realizable values are
determined by their estimated selling prices less estimated sales expenses and relevant taxes. For material
inventories held for purpose of production their net realizable values are determined by the estimated selling
prices of finished products less estimated costs estimated sales expenses and relevant taxes accumulated till
completion of production. As for inventories held for implementation of sales contracts or service contracts their
net realizable values are calculated on the basis of contract prices. In the event that inventories held by a company
exceed order amount as agreed in sales contracts net realizable values of the surplus part are calculated on the
basis of normal sale price.
(4) Inventory system
Perpetual Inventory System is adopted by the Company and takes a physical inventory.
(5) Amortization of low-value consumables and wrappage
①Low-value consumables
The Company adopts one-off amortization method to amortize the low-value consumables.②Wrappage
The Company adopts one-off amortization method to amortize the wrappage at the time of receipt.
16.Contract assets
Applicable from 1 Jan. 2020.
The Company presents the contract assets or contract liabilities in the balance sheet based on the relationship
between the performance obligation and the customer’s payment.Recognition method and standard of contract assets: contract assets refer to the right of a company to receive
consideration after transferring goods or providing services to customers and this right depends on other factors
besides the passage of time. The company's unconditional (that is only depending on the passage of time) right to
collect consideration from customers are separately listed as receivables.Method for determining expected credit losses of contract assets: the method for determining expected credit
losses of contract assets is consistent with the method for determining expected credit losses of accounts
receivable.
Accounting treatment method of expected credit losses of contract assets: if the contract assets are impaired the
company shall debit the "asset impairment loss" subject and credit the "contract asset impairment provision"
subject according to the amount that should be written down. When reversing the provision for asset impairment
that has already been withdrawn make opposite accounting entries.
17.Assets held for sale
The Company classifies non-current assets or disposal groups that meet all of the following conditions as
held-for-sale: according to the practice of selling this type of assets or disposal groups in a similar transaction the
non-current assets or disposal group can be sold immediately at its current condition; The sale is likely to occur
that is the Company has made resolution on the selling plan and obtained definite purchase commitment the
selling is estimated to be completed within one year. Those assets whose disposal is subject to approval from
relevant authority or supervisory department under relevant requirements are subject to that approval.Where the Company loses control over its subsidiary due to disposal of investment in the subsidiary whether or
not the Company retains part equity investment after such disposal investment in the subsidiary shall be classified
in its entirety as held for sale in the separate financial statement of the parent company subject to that the
investment in the subsidiary proposed to be disposed satisfies the conditions for being classified as held for sale
and all the assets and liabilities of the subsidiary shall be classified as held for sale in consolidated financial
statement.The purchase commitment identified refers to the legally binding purchase agreement entered into between the
Company and other parties which sets out certain major terms relating to transaction price time and adequately
stringent punishment for default which render an extremely minor possibility for material adjustment or
revocation of the agreement.
Assets held for sale are measured at the lower of heir carrying value and fair value less selling expense. If the
carrying value is higher than fair value less selling expense the excess shall be recognized as impairment loss and
recorded in profit or loss for the period and allowance for impairment shall be provided for in respect of the
assets. In respect of impairment loss recognized for disposal group held for sale carrying value of the goodwill in
the disposal group shall be deducted first and then deduct the carrying value of the non-current assets within the
disposal group applicable to this measurement standard on a pro rata basis according to the proportion taken by
their carrying value.If the net amount of fair value of non-current assets held for sale less sales expense on subsequent balance sheet
date increases the amount previously reduced for accounting shall be recovered and reverted from the impairment
loss recognized after the asset is classified under the category of held for sale with the amount reverted recorded
in profit or loss for the period. Impairment loss recognized before the asset is classified under the category of held
for sale shall not be reverted.If the net amount of fair value of the disposal group held for sale on the subsequent
balance sheet date less sales expenses increases the amount reduced for accounting in previous periods shall be
restored and shall be reverted in the impairment loss recognized in respect of the non-current assets which are
applicable to relevant measurement provisions after classification into the category of held for sale with the
reverted amount charged in profit or loss for the current period. The written-off carrying value of goodwill shall
not be reverted.The non-current assets in the non-current assets or disposal group held for sale is not depreciated or amortized
and the debt interests and other fees in the disposal group held for sale continue to be recognized.If the non-current assets or disposal group are no longer classified as held for sale since they no longer meet the
condition of being classified as held for sale or the non-current assets are removed from the disposal group held
for sale they will be measured at the lower of the following:
(i)The amount after their book value before they are classified as held for sale is adjusted based on the
depreciation amortization or impairment that should have been recognized given they are not classified as held
for sale;
(ii) The recoverable amount.
18.Long-term equity investment
Long-term equity investments refer to long-term equity investments in which the Company has control joint
control or significant influence over the invested party. Long-term equity investment without control or joint
control or significant influence of the Group is accounted for as available-for-sale financial assets or financial
assets measured by fair value and with variation reckoned into current gains/losses. As for other accounting
policies found more in “10. Financial instrument” in Note V.
(1) Determination of initial investment cost
Investment costs of the long-term equity investment are recognized by the follow according to different way of
acquirement:
①For a long-term equity investment acquired through a business combination involving enterprises under
common control the initial investment cost of the long-term equity investment shall be the absorbing party’s
share of the carrying amount of the owner’s equity under the consolidated financial statements of the ultimate
controlling party on the date of combination. The difference between the initial cost of the long-term equity
investment and the cash paid non-cash assets transferred as well as the book value of the debts borne by the
absorbing party shall offset against the capital reserve. If the capital reserve is insufficient to offset the retained
earnings shall be adjusted. If the consideration of the merger is satisfied by issue of equity securities the initial
investment cost of the long-term equity investment shall be the absorbing party’s share of the carrying amount of
the owner’s equity under the consolidated financial statements of the ultimate controlling party on the date of
combination. With the total face value of the shares issued as share capital the difference between the initial cost
of the long-term equity investment and total face value of the shares issued shall be used to offset against the
capital reserve. If the capital reserve is insufficient to offset the retained earnings shall be adjusted. For business
combination resulted in an enterprise under common control by acquiring equity of the absorbing party under
common control through a stage-up approach with several transactions these transactions will be judged whether
they shall be treat as “transactions in a basket”. If they belong to “transactions in a basket” these transactions will
be accounted for a transaction in obtaining control. If they are not belong to “transactions in a basket” the initial
investment cost of the long-term equity investment shall be the absorbing party’s share of the carrying amount of
the owner’s equity under the consolidated financial statements of the ultimate controlling party on the date of
combination. The difference between the initial cost of the long-term equity investment and the aggregate of the
carrying amount of the long-term equity investment before merging and the carrying amount the additional
consideration paid for further share acquisition on the date of combination shall offset against the capital reserve.If the capital reserve is insufficient to offset the retained earnings shall be adjusted. Other comprehensive income
recognized as a result of the previously held equity investment accounted for using equity method on the date of
combination or recognized for available-for-sale financial assets will not be accounted for.
② For the long-term equity investment obtained by business combination not under the same control the fair
value of the assets involved the equity instruments issued and the liabilities incurred or assumed on the
transaction date plus the combined cost directly related to the acquisition is used as the initial investment cost of
the long-term equity investment. The identifiable assets of the combined party and the liabilities (including
contingent liabilities) assumed by the combined party on the combining date are all measured at fair value
regardless of the amount of minority shareholders’ equity. The amount of the combined cost exceeding the fair
value of the identifiable net assets of the combined party obtained by the Company is recorded as goodwill and
the amount below the fair value of the identifiable net assets of the combining party is directly recognized in the
consolidated income statement.(For business combination resulted in an enterprise not under common control by
acquiring equity of the acquire under common control through a stage-up approach with several transactions
these transactions will be judged whether they shall be treat as “transactions in a basket”. If they belong to
“transactions in a basket” these transactions will be accounted for a transaction in obtaining control. If they are
not belong to “transactions in a basket” the initial investment cost of the long-term equity investment accounted
for using cost method shall be the aggregate of the carrying amount of equity investment previously held by the
acquire and the additional investment cost. For previously held equity accounted for using equity method relevant
other comprehensive income will not be accounted for. For previously held equity investment classified as
available-for-sale financial asset the difference between its fair value and carrying amount as well as the
accumulated movement in fair value previously included in the other comprehensive income shall be transferred
to profit or loss for the current period.)
③Long-term investments obtained through other ways:
A. Initial investment cost of long-term equity investment obtained through cash payment is determined according
to actual payment for purchase;
B. Initial investment cost of long-term equity investment obtained through issuance of equity securities is
determined at fair value of such securities;
C. Initial investment cost of long-term equity investment (exchanged-in) obtained through exchange with
non-monetary assets which is of commercial nature is determined at fair value of the assets exchanged-out;
otherwise determined at carrying value of the assets exchanged-out if it is not of commercial nature;
D. Initial investment cost of long-term equity investment obtained through debt reorganization is determined at
fair value of such investment.
(2) Subsequent measurement on long-term equity investment
①Presented controlling ability on invested party the investment shall use cost method for measurement.②Long-term equity investments with joint control (excluding those constitute joint ventures) or significant
influence on the invested party are accounted for using equity method.Under the equity method where the initial investment cost of a long-term equity investment exceeds the
investor’s interest in the fair value of the invested party’s identifiable net assets at the acquisition date no
adjustment shall be made to the initial investment cost. Where the initial investment cost is less than the investor’s
interest in the fair value of the invested party’s identifiable net assets at the acquisition date the difference shall be
charged to profit or loss for the current period and the cost of the long term equity investment shall be adjusted
accordingly.Under the equity method investment gain and other comprehensive income shall be recognized based on the
Group’s share of the net profits or losses and other comprehensive income made by the invested party
respectively. Meanwhile the carrying amount of long-term equity investment shall be adjusted. The carrying
amount of long-term equity investment shall be reduced based on the Group’s share of profit or cash dividend
distributed by the invested party. In respect of the other movement of net profit or loss other comprehensive
income and profit distribution of invested party the carrying value of long-term equity investment shall be
adjusted and included in the capital reserves. The Group shall recognize its share of the invested party’s net profits
or losses based on the fair values of the invested party’s individual separately identifiable assets at the time of
acquisition after making appropriate adjustments thereto. In the event of in-conformity between the accounting
policies and accounting periods of the invested party and the Company the financial statements of the invested
party shall be adjusted in conformity with the accounting policies and accounting periods of the Company.Investment gain and other comprehensive income shall be recognized accordingly. In respect of the transactions
between the Group and its associates and joint ventures in which the assets disposed of or sold are not classified as
operation the share of unrealized gain or loss arising from inter-group transactions shall be eliminated by the
portion attributable to the Company. Investment gain shall be recognized accordingly. However any unrealized
loss arising from inter-group transactions between the Group and an invested party is not eliminated to the extent
that the loss is impairment loss of the transferred assets. In the event that the Group disposed of an asset classified
as operation to its joint ventures or associates which resulted in acquisition of long-term equity investment by the
investor without obtaining control the initial investment cost of additional long-term equity investment shall be
the fair value of disposed operation. The difference between initial investment cost and the carrying value of
disposed operation will be fully included in profit or loss for the current period. In the event that the Group sold an
asset classified as operation to its associates or joint ventures the difference between the carrying value of
consideration received and operation shall be fully included in profit or loss for the current period. In the event
that the Company acquired an asset which formed an operation from its associates or joint ventures relevanttransaction shall be accounted for in accordance with “Accounting Standards for Business Enterprises No. 20
“Business combination”. All profit or loss related to the transaction shall be accounted for.
The Group’s share of net losses of the invested party shall be recognized to the extent that the carrying amount of
the long-term equity investment together with any long-term interests that in substance form part of the investor’s
net investment in the invested party are reduced to zero. If the Group has to assume additional obligations the
estimated obligation assumed shall be provided for and charged to the profit or loss as investment loss for the
period. Where the invested party is making profits in subsequent periods the Group shall resume recognizing its
share of profits after setting off against the share of unrecognized losses.
③Acquisition of minority interest
Upon the preparation of the consolidated financial statements since acquisition of minority interest increased of
long-term equity investment which was compared to fair value of identifiable net assets recognized which are
measured based on the continuous measurement since the acquisition date (or combination date) of subsidiaries
attributable to the Group calculated according to the proportion of newly acquired shares the difference of which
recognized as adjusted capital surplus capital surplus insufficient to set off impairment and adjusted retained
earnings.
④Disposal of long-term equity investments
In these consolidated financial statements for disposal of a portion of the long-term equity investments in a
subsidiary without loss of control the difference between disposal cost and disposal of long-term equity
investments relative to the net assets of the subsidiary is charged to the owners’ equity. If disposal of a portion of
the long-term equity investments in a subsidiary by the parent company results in a change in control it shall beaccounted for in accordance with the relevant accounting policies as described in Note V.-6 “Preparation Methodof the Consolidated Financial Statements”.On disposal of a long-term equity investment otherwise the difference between the carrying amount of the
investment and the actual consideration paid is recognized through profit or loss in the current period.In respect of long-term equity investment accounted for using equity method with the remaining equity interest
after disposal also accounted for using equity method other comprehensive income previously under owners’
equity shall be accounted for in accordance with the same accounting treatment for direct disposal of relevant
asset or liability by invested party on pro rata basis at the time of disposal. The owners’ equity recognized for the
movement of other owners’ equity (excluding net profit or loss other comprehensive income and profit
distribution of invested party) shall be transferred to profit or loss for the current period on pro rata basis.In respect of long-term equity investment accounted for using cost method with the remaining equity interest after
disposal also accounted for cost equity method other comprehensive income measured and reckoned under equity
method or financial instrument before control of the invested party unit acquired shall be accounted for in
accordance with the same accounting treatment for direct disposal of relevant asset or liability by invested party
on pro rata basis at the time of disposal and shall be transferred to profit or loss for the current period on pro rata
basis; among the net assets of invested party unit recognized by equity method (excluding net profit or loss other
comprehensive income and profit distribution of invested party) shall be transferred to profit or loss for the current
period on pro rata basis.In the event of loss of control over invested party due to partial disposal of equity investment by the Group in
preparing separate financial statements the remaining equity interest which can apply common control or impose
significant influence over the invested party after disposal shall be accounted for using equity method. Such
remaining equity interest shall be treated as accounting for using equity method since it is obtained and
adjustment was made accordingly. For remaining equity interest which cannot apply common control or impose
significant influence over the invested party after disposal it shall be accounted for using the recognition and
measurement standard of financial instruments. The difference between its fair value and carrying amount as at
the date of losing control shall be included in profit or loss for the current period. In respect of other
comprehensive income recognized using equity method or the recognition and measurement standard of financial
instruments before the Group obtained control over the invested party it shall be accounted for in accordance with
the same accounting treatment for direct disposal of relevant asset or liability by invested party at the time when
the control over invested party is lost. Movement of other owners’ equity (excluding net profit or loss other
comprehensive income and profit distribution under net asset of invested party accounted for and recognized
using equity method) shall be transferred to profit or loss for the current period at the time when the control over
invested party is lost. Of which for the remaining equity interest after disposal accounted for using equity method
other comprehensive income and other owners’ equity shall be transferred on pro rata basis. For the remaining
equity interest after disposal accounted for using the recognition and measurement standard of financial
instruments other comprehensive income and other owners’ equity shall be fully transferred.In the event of loss of common control or significant influence over invested party due to partial disposal of equity
investment by the Group the remaining equity interest after disposal shall be accounted for using the recognition
and measurement standard of financial instruments. The difference between its fair value and carrying amount as
at the date of losing common control or significant influence shall be included in profit or loss for the current
period. In respect of other comprehensive income recognized under previous equity investment using equity
method it shall be accounted for in accordance with the same accounting treatment for direct disposal of relevant
asset or liability by invested party at the time when equity method was ceased to be used. Movement of other
owners’ equity (excluding net profit or loss other comprehensive income and profit distribution under net asset of
invested party accounted for and recognized using equity method) shall be transferred to profit or loss for the
current period at the time when equity method was ceased to be used.The Group disposes its equity investment in subsidiary by a stage-up approach with several transactions until the
control over the subsidiary is lost. If the said transactions belong to “transactions in a basket” each transaction
shall be accounted for as a single transaction of disposing equity investment of subsidiary and loss of control. The
difference between the disposal consideration for each transaction and the carrying amount of the corresponding
long-term equity investment of disposed equity interest before loss of control shall initially recognized as other
comprehensive income and subsequently transferred to profit or loss arising from loss of control for the current
period upon loss of control.
(3) Impairment test method and withdrawal method for impairment provision
Found more in NoteV-24.”impairment of long-term assets”
(4) Criteria of Joint control and significant influence
Joint control is the Company’s contractually agreed sharing of control over an arrangement which relevant
activities of such arrangement must be decided by unanimously agreement from parties who share control. All the
participants or participant group whether have controlling over such arrangement as a group or not shall be judge
firstly than judge that whether the decision-making for such arrangement are agreed unanimity by the participants
or not.Significant influence is the power of the Company to participate in the financial and operating policy decisions of
an invested party but to fail to control or joint control the formulation of such policies together with other
parties.While recognizing whether have significant influence by invested party the potential factors of voting
power as current convertible bonds and current executable warrant of the invested party held by investors and
other parties shall be thank over.
19.Investment real estate
Measurement model of investment real estate
Cost measurement
Depreciation or amortization
Investment real estate is stated at cost. During which the cost of externally purchased properties
held-for-investment includes purchasing price relevant taxes and surcharges and other expenses which are
directly attributable to the asset. Cost of self construction of properties held for investment is composed of
necessary expenses occurred for constructing those assets to a state expected to be available for use. Properties
held for investment by investors are stated at the value agreed in an investment contract or agreement but those
under contract or agreement without fair value are stated at fair value.The Company adopts cost methodology amid subsequent measurement of properties held for investment while
depreciation and amortization is calculated using the straight-line method according to their estimated useful lives.The basis of provision for impairment of properties held for investment is referred to Note V-24“Impairment oflong-term assets”
20. Fixed assets
(1) Recognition conditions
Fixed assets refer to the tangible assets for production of products provision of labor lease or operation with a
service life excess one year and has more unit value.
(2) Depreciation methods
Category Depreciation method Years of depreciation Scrap value rate Yearly depreciation rate
House and Building Straight-line depreciation 20~35 5 2.71~4.75
Machinery equipment Straight-line depreciation 10 5 9.50
Transportation equipment Straight-line depreciation 4~5 5 19.00~23.75
Electronic and other equipment Straight-line depreciation 3～10 5 9.50～31.67
For the fixed assets with impairment provision the depreciation amount shall be calculated after deducting the
accumulated amount of impairment provision for fixed assets
(3) Recognition basis valuation and depreciation method for financial lease assets
The Company affirms those that conform to below one or several criteria as the finance lease fixed assets:
① Agreed in the lease contract (or made a reasonable judgment according to the correlated conditions on the lease
commencement date) the ownership of lease fixed assets can be transferred to the Company after the expiry of
the lease period;
② The Company has the option to purchase or lease the fixed assets and the purchase price is estimated to be
much less than the fair value of the lease of fixed assets when exercises the options so whether the Company will
exercise the option can be reasonably determined on the lease commencement date;
③ Even though the fixed asset ownership is not transferred the lease term accounts for 75% of the service life of
the lease fixed assets;
④ The present value of the Company’s of minimum lease payment on the lease commencement date is equivalent
to 90% or more of the fair value of the lease fixed assets on the lease commencement date; the present value of the
leaser’s of minimum lease payment on the lease commencement date is equivalent to 90% or more of the fair
value of the lease fixed assets on the lease commencement date;
⑤ The leased assets with special properties can only be used by the Company without major modifications. The
fixed assets rented by finance leases is calculated as the book value according to the lower one between the fair
value of leased assets on the lease commencement date and the present value of the minimum lease payments.
(4) The impairment test method of fixed assets and the method of provision for impairment see Note
V-24“Impairment of long-term assets”.
21.Construction in progress
From the date on which the fixed assets built by the Company come into an expected usable state the projects
under construction are converted into fixed assets on the basis of the estimated value of project estimates or
pricing or project actual costs etc. Depreciation is calculated from the next month. Further adjustments are made
to the difference of the original value of fixed assets after final accounting is completed upon completion of
projects.The basis of provision for impairment of properties held for construction in processis referred to Note
V-24“Impairment of long-term assets”
22. Borrowing costs
(1) Recognition of capitalization of borrowing costs
Borrowing costs comprise interest occurred amortization of discounts or premiums ancillary costs and exchange
differences in connection with foreign currency borrowings. The borrowing costs of the Company which incur
from the special borrowings occupied by the fixed assets that need more than one year (including one year) for
construction development of investment properties or inventories or from general borrowings are capitalized and
recorded in relevant assets costs; other borrowing costs are recognized as expenses and recorded in the profit or
loss in the period when they are occurred. Relevant borrowing costs start to be capitalized when all of the
following three conditions are met:
①Capital expenditure has been occurred;
②Borrowing costs have been occurred;
③ Acquisition or construction necessary for the assets to come into an expected usable state has been carried out.
(2) Period of capitalization of borrowing costs
Borrowing costs arising from purchasing fixed asset investment real estate and inventory and occurred after such
assets reached to its intended use of status or sales than reckoned into assets costs while satisfy the above
mentioned capitalization condition; capitalization of borrowing costs shall be suspended and recognized as current
expenditure during periods in which construction of fixed assets investment real estate and inventory are
interrupted abnormally when the interruption is for a continuous period of more than 3 months until the
acquisition construction or production of the qualifying asset is resumed; capitalization shall discontinue when
the qualifying asset is ready for its intended use or sale the borrowing costs occurred subsequently shall reckoned
into financial expenses while occurring for the current period.
(3) Measure of capitalization for borrowing cost
In respect of the special borrowings borrowed for acquisition construction or production and development of the
assets qualified for capitalization the amount of interests expenses of the special borrowings actually occurred in
the period less interest income derived from unused borrowings deposited in banks or less investment income
derived from provisional investment are recognized.With respect to the general borrowings occupied for acquisition construction or production and development of
the assets qualified for capitalization the capitalized interest amount for general borrowings is calculated and
recognized by multiplying a weighted average of the accumulated expenditure on the assets in excess of the
expenditure on the some assets of the special borrowings by a capitalization rate for general borrowings. The
capitalization rate is determined by calculation of the weighted average interest rate of the general borrowings.23. Intangible assets
(1) Measurement use of life and impairment testing
① Measurement of intangible assets
The intangible assets of the Company including land use rights patented technology and non-patents technology
etc.The cost of a purchased intangible asset shall be determined by the expenditure actually occurred and other related
costs.The cost of an intangible asset contributed by an investor shall be determined in accordance with the value
stipulated in the investment contract or agreement except where the value stipulated in the contract or agreement
is not fair.The intangible assets acquired through exchange of non-monetary assets which is commercial in substance is
carried at the fair value of the assets exchanged out; for those not commercial in substance they are carried at the
carrying amount of the assets exchanged out.The intangible assets acquired through debt reorganization are recognized at the fair value.
② Amortization methods and time limit for intangible assets:
Land use right of the company had average amortization by the transfer years from the beginning date of transfer
(date of getting land use light); Patented technology non-patented technology and other intangible assets of the
Company are amortized by straight-line method with the shortest terms among expected useful life benefit years
regulated in the contract and effective age regulated by the laws. The amortization amount shall count in relevant
assets costs and current gains/losses according to the benefit object.
As for the intangible assets as trademark with uncertain benefit terms amortization shall not be carried.
Impairment testing methods and accrual for depreciation reserves for the intangible assets found more in Note
V24-“Impairment of long-term assets”.
(2)Internal accounting policies relating to research and development expenditures
Expenses incurred during the research phase are recognized as profit or loss in the current period; expenses
incurred during the development phase that satisfy the following conditions are recognized as intangible assets
(patented technology and non-patents technology):
①It is technically feasible that the intangible asset can be used or sold upon completion;
②there is intention to complete the intangible asset for use or sale;
③ The products produced using the intangible asset has a market or the intangible asset itself has a market;
④there is sufficient support in terms of technology financial resources and other resources in order to complete
the development of the intangible asset and there is capability to use or sell the intangible asset;
⑤ the expenses attributable to the development phase of the intangible asset can be measured reliably.If the expenses incurred during the development phase did not qualify the above mentioned conditions such
expenses incurred are accounted for in the profit or loss for the current period.The development expenditure
reckoned in gains/losses previously shall not be recognized as assets in later period. The capitalized expenses in
development stage listed as development expenditure in balance sheet and shall be transfer as intangible assets
since such item reached its expected conditions for service.
24. Impairment of long-term assets
The Company will judge if there is any indication of impairment as at the balance sheet date in respect of
non-current non-financial assets such as fixed assets construction in progress intangible assets with a finite useful
life investment properties measured at cost and long-term equity investments in subsidiaries joint controlled
entities and associates. If there is any evidence indicating that an asset may be impaired recoverable amount shall
be estimated for impairment test. Goodwill intangible assets with an indefinite useful life and intangible assets
beyond working conditions will be tested for impairment annually regardless of whether there is any indication of
impairment.If the impairment test result shows that the recoverable amount of an asset is less than its carrying amount the
impairment provision will be made according to the difference and recognized as an impairment loss. The
recoverable amount of an asset is the higher of its fair value less costs of disposal and the present value of the
future cash flows expected to be derived from the asset. An asset’s fair value is the price in a sale agreement in an
arm’s length transaction. If there is no sale agreement but the asset is traded in an active market fair value shall be
determined based on the bid price. If there is neither sale agreement nor active market for an asset fair value shall
be based on the best available information. Costs of disposal are expenses attributable to disposal of the asset
including legal fee relevant tax and surcharges transportation fee and direct expenses incurred to prepare the
asset for its intended sale. The present value of the future cash flows expected to be derived from the asset over
the course of continued use and final disposal is determined as the amount discounted using an appropriately
selected discount rate. Provisions for assets impairment shall be made and recognized for the individual asset. If it
is not possible to estimate the recoverable amount of the individual asset the Group shall determine the
recoverable amount of the asset group to which the asset belongs. The asset group is the smallest group of assets
capable of generating cash flows independently.
For the purpose of impairment testing the carrying amount of goodwill presented separately in the financial
statements shall be allocated to the asset groups or group of assets benefiting from synergy of business
combination. If the recoverable amount is less than the carrying amount the Group shall recognize an impairment
loss. The amount of impairment loss shall first reduce the carrying amount of any goodwill allocated to the asset
group or set of asset groups and then reduce the carrying amount of other assets (other than goodwill) within the
asset group or set of asset groups pro rata on the basis of the carrying amount of each asset.An impairment loss recognized on the aforesaid assets shall not be reversed in a subsequent period in respect of
the part whose value can be recovered.
25.Long-term deferred expenses
Long-term expenses to be amortized of the Company the expenses that are already charged and with the beneficial
term of more than one year are evenly amortized over the beneficial term. For the long-term deferred expense
items cannot benefit the subsequent accounting periods the amortized value of such items is all recorded in the
profit or loss during recognition.
26.Contract liability
The Company lists the obligation to transfer goods or provide labor services to customers for the consideration
received or receivable from customers as contract liabilities such as the amount that the company has received
before the transfer of the promissorygoods.
27. Employee compensation
(1) Accounting treatment for short-term compensation
During the accounting period when the staff providing service to the Company the short-term remuneration actual
occurred shall recognized as liability and reckoned into current gains/losses. During the accounting period when
staff providing service to the Company the actual short-term compensation occurred shall recognized as liabilities
and reckoned into current gains/losses except for those in line with accounting standards or allow to reckoned
into capital costs; the welfare occurred shall reckoned into current gains/losses or relevant asses costs while
actually occurred. The employee compensation shall recognize as liabilities and reckoned into current gains/losses
or relevant assets costs while actually occurred. The employee benefits that belong to non-monetary benefits are
measured in accordance with the fair value; the social insurances including the medical insurance work-injury
insurance and maternity insurance and the housing fund that the enterprise pays for the employees as well as the
labor union expenditure and employee education funds withdrawn by rule should be calculated and determined as
the corresponding compensation amount and determined the corresponding liabilities in accordance with the
specified withdrawing basis and proportion and reckoned in the current profits and losses or relevant asset costs
in the accounting period that the employees provide services.
(2) Accounting treatment for post-employment benefit
The post-employment benefit included the defined contribution plans and defined benefit plans. Post-employment
benefits plan refers to the agreement about the post-employment benefits between the enterprise and employees
or the regulations or measures the enterprise established for providing post-employment benefits to employees.Thereinto the defined contribution plan refers to the post-employment benefits plan that the enterprise doesn’t
undertake the obligation of payment after depositing the fixed charges to the independent fund; the defined benefit
plans refers to post-employment benefits plans except the defined contribution plan.
(3)Accounting treatment for retirement benefits
When the Company terminates the employment relationship with employees before the end of the employment
contracts or provides compensation as an offer to encourage employees to accept voluntary redundancy the
Company shall recognize employee compensation liabilities arising from compensation for staff dismissal and
included in profit or loss for the current period when the Company cannot revoke unilaterally compensation for
dismissal due to the cancellation of labor relationship plans and employee redundant proposals; and the Company
recognize cost and expenses related to payment of compensation for dismissal and restructuring whichever is
earlier.The early retirement plan shall be accounted for in accordance with the accounting principles for
compensation for termination of employment. The salaries or wages and the social contributions to be paid for the
employees who retire before schedule from the date on which the employees stop rendering services to the
scheduled retirement date shall be recognized (as compensation for termination of employment) in the current
profit or loss by the Group if the recognition principles for provisions are satisfied.
(4)Accounting treatment for other long-term employee benefits
Except for the compulsory insurance the Company provides the supplementary retirement benefits to the
employees satisfying some conditions the supplementary retirement benefits belong to the defined benefit plans
and the defined benefitliability confirmed on the balance sheet is the value by subtracting the fair value of plan
assets from the present value of defined benefit obligation. The defined benefit obligation is annually calculated in
accordance with the expected accumulated welfare unit method by the independent actuary by adopting the
treasury bond rate with similar obligation term and currency. The service charges related to the supplementary
retirement benefits (including the service costs of the current period the previous service costs and the settlement
gains or losses) and the net interest are reckoned in the current profits and losses or other asset costs the changes
generated by recalculating the net liabilities of defined benefit plans or net assets should be reckoned in other
consolidated income.
28. Accrual liabilities
(1) Recognition principle
An obligation related to a contingency such as guarantees provided to outsiders pending litigation or arbitration
product warranties redundancy plans onerous contracts reconstructing expected disposal of fixed assets etc.shall be recognized as an estimated liability when all of the following conditions are satisfied:
① the obligation is a present obligation of the Company;
② it is Contingent that an outflow of economic benefits will be required to settle the obligation;
③ the amount of the obligation can be measured reliably.(2) Measurement method: Measure on the basis of the best estimates of the expenses necessary for paying off the
contingencies
29. Share-based payment
The Company’s share-based payment is a transaction that grants equity instruments or assumes liabilities
determined on the basis of equity instruments in order to obtain services provided by employees or other parties.The Company’s share-based payment is classified as equity-settled share-based payment and cash-settled
share-based payment.
(1) Equity-settled share-based payment and equity instruments
Equity-settled share-based payment in exchange for services provided by employees shall be measured at the fair
value of the equity instruments granted to employees. If the Company uses restricted stocks for share-based
payment employees contribute capital to subscribe for stocks and the stocks shall not be listed for circulation or
transfer until the unlocking conditions are met and unlocked; if the unlocking conditions specified in the final
equity incentive plan are not met the Company shall repurchase the stocks at the pre-agreed price. When the
Company obtains the payment for the employees to subscribe for restricted stocks it shall confirm the share
capital and capital reserve (share capital premium) according to the obtained subscription money and at the same
time recognize a liability in full for the repurchase obligation and recognize treasury shares. On each balance sheet
date during the waiting period the Company makes the best estimate of the number of vesting equity instruments
based on the changes in the latest obtained number of vested employees whether they meet the specified
performance conditions and other follow-up information. On this basis the services obtained in the current period
are included in related costs or expenses based on the fair value on the grant date and the capital reserve shall be
increased accordingly.
For share-based payments that cannot be vested in the end costs or expenses shall not be recognized unless the
vesting conditions are market conditions or non-vesting conditions. At this time regardless of whether the market
conditions or the non-vesting conditions are met as long as all non-market conditions in the vesting conditions are
met it is deemed as vesting.If the terms of equity-settled share-based payment are modified at least the services obtained should be confirmed
in accordance with the unmodified terms. In addition any modification that increases the fair value of the equity
instruments granted or a change that is beneficial to employees on the modification date is recognized as an
increase in services received.If the equity-settled share payment is cancelled it will be treated as an accelerated vesting on the cancellation day
and the unconfirmed amount will be confirmed immediately. If an employee or other party can choose to meet the
non-vesting conditions but fails to meet within the waiting period it shall be treated as cancellation of
equity-settled share-based payment. However if a new equity instrument is granted and it is determined on the
date of grant of the new equity instrument that the new equity instrument granted is used to replace the cancelled
equity instrument the granted substitute equity instruments shall be treated in the same way as the modification of
the original equity instrument terms and conditions.
(2) Cash-settled share-based payment and equity instruments
Cash-settled share-based payments are measured at the fair value of the liabilities calculated and determined on
the basis of shares or other equity instruments undertaken by the Company. If it’s vested immediately after the
grant the fair value of the liabilities assumed on the date of the grant is included in the cost or expense and the
liability is increased accordingly. If the service within the waiting period is completed or the specified
performance conditions are met the service obtained in the current period shall be included in the relevant costs
or expenses based on the best estimate of the vesting situation within the waiting periodand the fair value of the
liabilities assumed to increase the corresponding liabilities. On each balance sheet date and settlement date before
the settlement of the relevant liabilities the fair value of the liabilities is remeasured and the changes are included
in the current profit and loss.
30. Revenue
Accounting policies used in revenue recognition and measurement
Accounting policies applicable as of 1 January 2020:
(1)Accounting policies used in revenue recognition and measurement
1)Revenue recognition principle
On the starting date of the contract the company evaluates the contract identifies each individual performance
obligation contained in the contract and determines whether each individual performance obligation is performed
within a certain period of time or at a certain point in time.When one of the following conditions is met it belongs to the performance obligation within a certain period of
time otherwise it belongs to the performance obligation at a certain point in time: ① The customer obtains and
consumes the economic benefits brought by the company's performance while the company performs the contract;
②The customer can control the goods or services under construction during the company’s performance; ③The
goods or services produced during the company’s performance have irreplaceable uses and the company has the
right to collect payment for the performance part that has been completed so far during the entire contract period.
For performance obligations performed within a certain period of time the company recognizes revenue in
accordance with the performance progress during that period. When the performance progress cannot be
reasonably determined if the cost incurred is expected to be compensated the revenue shall be recognized
according to the amount of the cost incurred until the performance progress can be reasonably determined.For
performance obligations performed at a certain point in time revenue is recognized at the point when the
customer obtains control of the relevant goods or services. When judging whether the customer has obtained
control of the goods the company considers the following signs:① The company has the current right to receive
payment for the goods that is the customer has the current payment obligation for the goods; ②The company has
transferred the legal ownership of the goods to the customer that is the customer has the legal ownership of the
goods; ③The company has transferred the goods to the customer in kind that is the customer has physically
taken possession of the goods; ④ The company has transferred the main risks and rewards of the ownership of the
goods to the customer that is the customer has obtained the main risks and rewards of the ownership of the goods;
⑤ The customer has accepted the goods; ⑥Other signs that the customer has obtained control of the goods.
2)Revenue measurement principle
①The company measures revenue based on the transaction price allocated to each individual performance
obligation. The transaction price is the amount of consideration that the company expects to be entitled to receive
due to the transfer of goods or services to customers and does not include payments collected on behalf of third
parties and payments expected to be returned to customers.②If there is variable consideration in the contract the company shall determine the best estimate of the variable
consideration according to the expected value or the most likely amount but the transaction price including the
variable consideration shall not exceed the amount of cumulatively recognized revenue that is unlikely to be
significantly turned back when the relevant uncertainty is eliminated.③ If there is a significant financing component in the contract the company shall determine the transaction price
based on the amount payable that the customer is assumed to pay in cash when obtaining the control of the goods
or services. The difference between the transaction price and the contract consideration shall be amortized by the
effective interest method during the contract period. On the starting date of the contract if the company expects
that the customer pays the price within one year after obtaining control of the goods or services the significant
financing components in the contract shall not be considered.④If the contract contains two or more performance obligations the company will allocate the transaction price to
each individual performance obligation based on the relative proportion of the stand-alone selling price of the
goods promised by each individual performance obligation on the starting date of the contract.
(2) The Company's standard for the revenue recognition of the sales of goods and the specific judgment standard
for the confirmation time:
The time when the Company’s domestic sales revenue is confirmed: The company delivers the goods according to
the order. On the reconciliation date agreed with the buyer check the goods received and inspected by the buyer
during the period from the last reconciliation date to this reconciliation date with the buyer and the risks and
rewards are transferred to the buyer after checking the Company issues an invoice to the buyer according to the
type quantity and amount confirmed in the reconciliation and confirms the realization of sales revenue on the
reconciliation day.The time when the Company’s foreign sales revenue is confirmed: After the customs review is completed the
Company will confirm the realization of the sales revenue according to the export date specified on the customs
declaration.
Accounting policies applicable for year of 2019:
(1) Concrete judging criteria for time of recognized
The major risks and remuneration entitled to the ownership of goods are transferred to buyer; neither retain the
continued management right generally related to ownership nor exercise effective control over the sold products;
the relevant economic benefits are probable to flow into the Company; the relevant income and costs can be
measured reliably.
Concrete judging criteria for time of recognized the income from goods sales:
The Company's domestic sales revenue recognition time: The company delivers goods as agreed checks the goods
that the buyers have received and inspected during the period of the last reconciliation date and this reconciliation
date with the buyers on the reconciliation date as agreed and transfers the risks and remunerations to the buyers
after checking the Company issues the invoices to the buyers in accordance with the recognized varieties
quantities and amounts and affirms the sales revenue realization on the reconciliation date.The Company's overseas sales revenue recognition time: After checking by the customs the Company affirms the
sales revenue realization according to the date of departure on the customs declaration.
(2) Recognition of revenue of assets using right alienation
Revenue from use by others of enterprise assets shall be recognized only when the associated economic benefit
can flow into the Company and the amount of revenue can be measured reliably revenue measured by the follow:
① Interest income amount: calculated and determined in accordance with the time that others use the enterprises
cash and the actual interest rate.②Royalty revenue amount: calculated and determined in accordance with the charging time and method of the
relevant contract or agreement as agreed.The basis that the Company confirms the revenue from transferring the right to use assets.Rental income: the revenue realization is confirmed after collecting the rent on the date as agreed in the rental
contract (or agreement). For the rent not received on the date as agreed in the contract or agreement but can be
received and of which the amount of revenue can be measured reliably can also be recognized as revenue.
(3) When confirming the incomes of labor services and construction contracts according to the percentage of
completion method determine the basis and method of the contract completion plan.For the service transaction results can be estimated reliably on the balance sheet date the service revenue is
determined and recognized by adopting the percentage of completion method. The completion progress of service
transaction is determined by the proportion of incurred costs in the estimated total cost.The total service revenue is determined by the received or receivable contract or agreement costs except that the
received or receivable contract or agreement costs are not fair. On the balance sheet date the service revenue of the
current period is determined by multiplying the total service revenue by the completion progress and deducting
the amount accumulated in the previous accounting period and confirmed to render the service revenue.Meanwhile the labor costs of the current period are carried forward by multiplying the total estimated costs of
labor services by the completion progress and deducting the amount accumulated in the previous accounting
period with confirmed service costs.
For the service transaction results cannot be estimated reliably on the balance sheet date respectively dispose as
following circumstances:
①The incurred labor costs estimated to be compensated are confirmed to render the service revenue according to
the incurred labor costs and are carried forward by the equivalent amount.②The incurred labor costs estimated not to be compensated are reckoned in the current profits or losses and are
not confirmed to render the service revenue.
Differences in accounting policies for revenue recognition due to different operating models for the same type of
business Nil
31. Government grants
(1) Types
Government grants are transfer of monetary assets or non-monetary assets from the government to the Group at
no consideration. Government grants are classified into government grants related to assets and government grants
related to income.
As for the assistance object not well-defined in government’s documents the classification criteria for
assets-related or income-related grants are as: whether the grants turn to long-term assets due to purchasing for
construction or other means.
(2) Recognition and measure
The government grants shall be recognized while meet the additional conditions of the grants and amount is
actually can be obtained.If a government grant is in the form of a transfer of monetary asset the item shall be measured at the amount
received or receivable. If a government grant is in the form of a transfer of non-monetary asset the item shall be
measured at fair value. If the fair value can not be reliably acquired than measured by nominal amount.
(3) Accounting treatment
A government grant related to an asset shall be recognized as deferred income and reckoned into current
gains/losses according to the depreciation process in use life of such assets.
A government grant related to income if they making up relevant expenses and losses for later period than
recognized deferred income and should reckoned into current gain/loss during the period while relevant expenses
are recognized; if they making up relevant expenses and losses that occurred than reckoned into current
gains/losses.
A government grant related to daily operation activity of the Company should reckoned into other income; those
without related to daily operation activity should reckoned into non-operation income and expenses.The financial discount funds received by the Company shall write down relevant borrowing costs.
32.Deferred income tax assets/Deferred income tax liabilities
(1) Deferred income tax assets or deferred income tax liabilities are realized based on the difference between the
carrying values of assets and liabilities and their taxation bases (as for the ones did not recognized as assets and
liability and with taxation basis recognized in line with tax regulations different between tax base and its book
value) at the tax rates applicable in the periods when the Company recovers such assets or settles such liabilities.
(2) Deferred income tax assets are realized to the extent that it is probable to obtain such taxable income which is
used to set off the deductible temporary difference. As at the balance sheet date if there is obvious evidence
showing that it is probable to obtain sufficient taxable income to set off the deductible temporary difference in
future periods deferred income tax assets not realized in previous accounting periods shall be realized.
(3) On balance sheet date re-review shall be made in respect of the carrying value of deferred income tax assets.
If it is impossible to obtain sufficient taxable income to set off the benefits of deferred income tax assets in future
periods then the carrying value of deferred income tax assets shall be reduced accordingly. If it is probable to
obtain sufficient taxable income then the amount reduced shall be switched back.
(4) Current income tax and deferred income tax considered as income tax expenses or incomes reckoned into
current gains/losses excluding the follow income tax:
①Enterprise combination;
②Transactions or events recognized in owner’s equity directly
33. Lease
(1)Accounting for operating lease
The rental fee paid for renting the properties by the company are amortized by the straight-line method and
reckoned in the current expenses throughout the lease term without deducting rent-free period. The initial direct
costs related to the lease transactions paid by the company are reckoned in the current expenses.When the lessor undertakes the expenses related to the lease that should be undertaken by the company the
company shall deduct the expenses from the total rental costs share by the deducted rental costs during the lease
term and reckon in the current expenses.Rental obtained from assets leasing during the whole leasing period without rent-free period excluded shall be
amortized by straight-line method and recognized as leasing revenue. The initial direct costs paid with leasing
transaction concerned are reckoned into current expenditure; the amount is larger is capitalized when incurred
and accounted for as profit or loss for the current period on the same basis as recognition of rental income over the
entire lease period.When the company undertakes the expenses related to the lease that should be undertaken by the lessor the
company shall deduct the expenses from the total rental income and distribute by the deducted rental costs during
the lease term.
(2) Accounting treatment for financing lease
Assets lease-in by financing: On the beginning date of the lease the entry value of leased asset shall be at the
lower of the fair value of the leased asset and the present value of minimum lease payment at the beginning date
of the lease. Minimum lease payment shall be the entry value of long-term accounts payable with difference
recognized as unrecognized financing expenses.Unrecognized financing expenses shall be reckoned in financial
expenses and amortized and using effective interest method during the leasing period. The initial direct costs
incurred by the Company shall be reckoned into value of assets lease-in.
Finance leased assets: on the lease commencement date the company affirms the balance among the finance lease
receivables the sum of unguaranteed residual value and its present value as the unrealized financing income and
recognizes it as the rental income during the period of receiving the rent. For the initial direct costs related to the
rental transaction the company reckons in the initial measurement of the finance lease receivables and reduces
the amount of income confirmed in the lease term.34.Other important accounting policy and estimation
In the process of applying the Company's accounting policies due to the inherent uncertainty of business activities
the Company needs to judge estimate and assume the book value of the report items cannot be accurately
measured. These judgments estimates and assumptions are made on the basis of the historical experience of the
Company’s management and by considering other relevant factors which shall impact the reported amounts of
income expenses assets and liabilities and the disclosure of contingent liabilities on the balance sheet date.However the actual results caused by the estimated uncertainties may differ from the management's current
estimates of the Company so as to carry out the significant adjustments to the book value of the assets or liabilities
to be affected.The Company regularly reviews the aforementioned judgments estimates and assumptions on the basis of
continuing operations the changes in accounting estimates only affect the current period of which the impacts are
recognized in the current period; the changes in accounting estimates not only affect the current period but also the
future periods of which the impacts are recognized in the current and future periods.On the balance sheet date the important areas of the financial statements that the Company needs to judge estimate
and assume are as follows:
(1) Provision for bad debts
The Company has used the expected credit loss model to assess the impairment of financial instruments. The
application of the expected credit loss model requires significant judgement and estimates and must consider all
reasonable and evidence-based information including forward-looking information.In making such judgments
and estimates the Company infers the expected changes in debtors’ credit risks based on historical repayment data
combined with economic policies macroeconomic indicators industry risks and other factors.
(2) Inventory falling price reserves
According to the inventory accounting policies the Company measures by the comparison between the cost and
the net realizable value if the cost is higher than the net realizable value and the old and unsalable inventories the
Company calculates and withdraws the inventory impairment. The inventory devalues to the net realizable value
by evaluating the inventory’s vendibility and net realizable value. To identify the inventory impairment the
management needs to obtain the unambiguous evidences and consider the purpose to hold the inventory and
judge and estimate the impacts of events after the balance sheet date. The actual results and the differences
between the previously estimated results shall affect the book value of inventory and the provision or return of the
inventory impairment during the period estimated to be changed.
(3) Preparation for the impairment of non-financial & non-current assets
The Company checks whether the non-current assets except for the financial assets may decrease in value at the
balance sheet date. For the intangible assets with indefinite service life in addition to the annual impairment test
the impairment test is also needed when there is a sign of impairment. For the other non-current assets except for
the financial assets the impairment test is needed when it indicates that the book amounts may not be recoverable.When the book value of the asset or group of assets exceeds its recoverable amount i.e. the higher between the net
amount by subtracting the disposal costs from the fair value and the present value of expected future cash flows it
indicates the impairment.
As for the net amount by subtracting the disposal costs from the fair value refer to the sales agreement price
similar to the assets in the fair trade or the observable market price and subtract the incremental costs
determination directly attributable to the disposal of the asset.When estimating the present value of the future cash flow the Company needs to make significant judgments to
the output price and related operating expenses of the asset (or asset group) and the discount rate used for
calculating the present value. When estimating the recoverable amount the Company shall adopt all the relevant
information can be obtained including the prediction related to the output price and related operating expenses
based on the reasonable and supportable assumptions.The Company tests whether its business reputation decreases in value every year which requires to estimating the
present value of the asset group allocated with goodwill or the future cash flow combined by the asset group.When estimating the present value of the future cash flow the Company needs to estimate the future cash flows
generated by the asset group or the combination of asset group and select the proper discount rate to determine the
present value of the future cash flows.
(4) Depreciation and amortization
The Company depreciates and amortizes the investment property fixed assets and intangible assets according to
the straight-line method in the service life after considering the residual value. The Companyregularly reviews the
service life to determine the depreciation and amortization expense amount to be reckoned in each reporting period.The service life is determined by the Company based on the past experience of similar assets and the expected
technological updating. If the previous estimates have significant changes the depreciation and amortization
expense shall be adjusted in future periods.
(5) Fair value of financial instrument
Financial instruments that do not have active markets to provide quotes need to use valuation techniques to
determine fair value.Valuation techniques include the latest transaction information discounted cash flow methods
and option pricing models.The Company has established a set of work processes to ensure that qualified personnel
are responsible for the calculation verification and review of fair value.The valuation model used by the
Company uses the market information as much as possible and uses the Company-specific information as little as
possible.It should be noted that part of the information used in the valuation model requires management’s
estimation (such as discount rate target exchange rate volatility etc.).The Company regularly reviews the above
estimates and assumptions and makes adjustments if necessary.
(6) Income tax
In the Company’s normal business activities the final tax treatment and calculation of some transactions have
some uncertainties. Whether some projects can be disbursed from the cost and expenses before taxes requires
needs to get approval from the tax authorities. If the final affirmation of these tax matters differs from the initially
estimated amount the difference shall have an impact on its current and deferred income taxes during the final
identification period.
35.Changes of important accounting policy and estimation
(1)Changes of important accounting policies
√ Applicable □ Not applicable
Content and reasons for changes in accounting policies Approval process Note
Implementation of new revenue standard Deliberated and approved by AGM of 2019
Implementation of new revenue standard:
The Ministry of Finance revised the Accounting Standards for Business Enterprise No.14- Revenue in 2017
which go into effect on 1 January 2020. The revised standard requires that the cumulative impact of the first
implementation of the standard be adjusted by the amount of opening retained earnings and other related items in
the financial statement for the period of first-time implementation for comparable periods.Main impact on the financial statement of the Company on 1 Jan. 2020 while implementing the new revenue
standard:
Consolidated financial statement: In RMB/CNY
Item 2019-12-31 Reclassify Remeasurement 2020-1-1
Account receivable 2310666475.89 115015466.40 -- 2425681942.29
Other current liability -- 115015466.40 -- 115015466.40
--
Account received in advance 113737432.61 -110874750.61 -- 2862682.00
Contract liability -- 98565613.54 -- 98565613.54
Other current liability -- 12309137.07 -- 12309137.07
Financial statement of parent company:In RMB/CNY
Item 2019-12-31 Reclassify Remeasurement 2020-1-1
Account receivable 768500929.93 79739079.11 -- 848240009.04
Other current liability -- 79739079.11 -- 79739079.11
Account received in advance 12010730.30 -12010730.30 -- --
Contract liability -- 10628964.87 -- 10628964.87
Other current liability -- 1381765.43 -- 1381765.43
(2)Changes of important accounting estimate
□ Applicable √ Not applicable
(3) Adjustment the financial statements at the beginning of the first year of implementation of new financial
instrument standards new revenue standards and new leasing standards since 2020
Applicable
Whether need to adjust the items in balance sheet at the beginning of the year
√Yes □No
Consolidate balance sheet
In RMB
Item 2019-12-31 2020-01-01 Adjustments
Current assets:
Monetary funds 1596893711.87 1596893711.87
Settlement provisions
Capital lent
Transaction financial asset 3940885674.32 3940885674.32
Derivative financial assets
Note receivable 1812141371.94 1812141371.94
Account receivable 2310666475.89 2425681942.29 115015466.40
Receivables financing 23873317.86 23873317.86
Account paid in advance 139241917.78 139241917.78
Insurance receivable
Reinsurance receivables
Contract reserve of reinsurance receivable
Other account receivables 43730023.31 43730023.31
Including: Interest receivable 655052.98 655052.98
Dividend receivable 1070000.00 1070000.00
Buying back the sale of financial assets
Inventory 2418744835.82 2418744835.82
Contract assets
Assets held for sale
Non-current asset due within one year
Other current assets 1012055605.74 1012055605.74
Total current assets 13298232934.53 13413248400.93 115015466.40
Non-current assets:
Loans and payments on behalf
Creditors’ investment
Other creditors’ investment
Long-term account receivables
Long-term equity investment 5322405953.35 5322405953.35
Other equity instrument investment 285048000.00 285048000.00
Other non-current financial assets 1043589987.43 1043589987.43
Investment real estate 22410511.87 22410511.87
Fixed assets 2845176078.20 2845176078.20
Construction in progress 247857777.25 247857777.25
Productive biological assets
Oil and gas assets
Right-of-use asset
Intangible assets 430594372.12 430594372.12
Development expenses
Goodwill 1784086.79 1784086.79
Long-term deferred expenses 18536000.25 18536000.25
Deferred income tax assets 212476501.54 212476501.54
Other non-current assets 230235982.45 230235982.45
Total non-current assets 10660115251.25 10660115251.25
Total assets 23958348185.78 24073363652.18 115015466.40
Current liabilities:
Short-term borrowings 312153969.81 312153969.81
Loan from central bank
Capital borrowed
Transaction financial liability
Derivative financial liability
Note payable 1745218439.52 1745218439.52
Account payable 3312254229.84 3312254229.84
Account received in advance 113737432.61 2862682.00 -110874750.61
Contract liability 98565613.54 98565613.54
Selling financial asset of repurchase
Absorbing deposit and interbank deposit
Security trading of agency
Security sales of agency
Employee compensation payable 314343737.66 314343737.66
Taxes payable 129538411.86 129538411.86
Other account payable 65266262.39 65266262.39
Including: Interest payable
Dividend payable
Commission charge and commission payable
Reinsurance payable
Liability held for sale
Non-current liabilities due within one year
Other current liability 127324603.47 127324603.47
Total current liabilities 5992512483.69 6107527950.09 115015466.40
Non-current liabilities:
Insurance contract reserve
Long-term borrowings
Bonds payable
Including: preferred stock
Perpetual capital securities
Lease liability
Long-term account payable 35108263.11 35108263.11
Long-term employee compensation payable 58392053.61 58392053.61
Accrual liabilities
Deferred income 365116022.98 365116022.98
Deferred income tax liabilities 22566051.72 22566051.72
Other non-current liabilities
Total non-current liabilities 481182391.42 481182391.42
Total liabilities 6473694875.11 6588710341.51 115015466.40
Owners’ equity:
Share capital 1008950570.00 1008950570.00
Other equity instrument
Including: preferred stock
Perpetual capital securities
Capital reserve 3391527806.33 3391527806.33
Less: Inventory shares
Other comprehensive income 134871.67 134871.67
Reasonable reserve 3247757.06 3247757.06
Surplus reserve 510100496.00 510100496.00
Provision of general risk
Retained profit 12076443635.56 12076443635.56
Total owners’ equity attributable to parent company 16990405136.62 16990405136.62
Minority interests 494248174.05 494248174.05
Total owners’ equity 17484653310.67 17484653310.67
Total liabilities and owner’s equity 23958348185.78 24073363652.18 115015466.40
Balance sheet of parent company
In RMB
Item 2019-12-31 2020-01-01 Adjustments
Current assets:
Monetary funds 965770877.82 965770877.82
Transaction financial asset 3758789072.68 3758789072.68
Derivative financial assets
Note receivable 202403993.13 202403993.13
Account receivable 768500929.93 848240009.04 79739079.11
Receivables financing
Account paid in advance 89116730.45 89116730.45
Other account receivables 250014956.74 250014956.74
Including: Interest receivable 804929.68 804929.68
Dividend receivable 1070000.00 1070000.00
Inventory 565144234.49 565144234.49
Contract assets
Assets held for sale
Non-current asset due within one year
Other current assets 938616881.51 938616881.51
Total current assets 7538357676.75 7618096755.86 79739079.11
Non-current assets:
Creditors’ investment
Other creditors’ investment
Long-term account receivables
Long-term equity investment 6331363630.04 6331363630.04
Other equity instrument investment 209108000.00 209108000.00
Other non-current financial assets 1043589987.43 1043589987.43
Investment real estate
Fixed assets 1646333216.50 1646333216.50
Construction in progress 136573912.28 136573912.28
Productive biological assets
Oil and gas assets
Right-of-use asset
Intangible assets 203663423.60 203663423.60
Development expenses
Goodwill
Long-term deferred expenses
Deferred income tax assets 105137877.84 105137877.84
Other non-current assets 172646721.05 172646721.05
Total non-current assets 9848416768.74 9848416768.74
Total assets 17386774445.49 17466513524.60 79739079.11
Current liabilities:
Short-term borrowings 116126459.33 116126459.33
Transaction financial liability
Derivative financial liability
Note payable 284054137.00 284054137.00
Account payable 930273146.35 930273146.35
Account received in advance 12010730.30 -12010730.30
Contract liability 10628964.87 10628964.87
Employee compensation payable 213626754.45 213626754.45
Taxes payable 56540307.59 56540307.59
Other account payable 11976576.21 11976576.21
Including: Interest payable
Dividend payable
Liability held for sale
Non-current liabilities due within one year
Other current liability 81120844.54 81120844.54
Total current liabilities 1624608111.23 1704347190.34 79739079.11
Non-current liabilities:
Long-term borrowings
Bonds payable
Including: preferred stock
Perpetual capital securities
Lease liability
Long-term account payable
Long-term employee compensation payable 50058386.76 50058386.76
Accrual liabilities
Deferred income 322971778.82 322971778.82
Deferred income tax liabilities
Other non-current liabilities
Total non-current liabilities 373030165.58 373030165.58
Total liabilities 1997638276.81 2077377355.92 79739079.11
Owners’ equity:
Share capital 1008950570.00 1008950570.00
Other equity instrument
Including: preferred stock
Perpetual capital securities
Capital reserve 3488221286.39 3488221286.39
Less: Inventory shares
Other comprehensive income
Reasonable reserve
Surplus reserve 510100496.00 510100496.00
Retained profit 10381863816.29 10381863816.29
Total owners’ equity 15389136168.68 15389136168.68
Total liabilities and owner’s equity 17386774445.49 17466513524.60 79739079.11
(4) Retrospective adjustment of early comparison data description when initially implemented the new
financial instrument standards and new leasing standards since 2020
□ Applicable √ Not applicable
36. Other
VI. Taxation
1. Major taxes and tax rates
Tax Basis Tax rate
VAT
General taxpayers of the company and domestic
subsidiaries calculate output tax at the tax rates of
13% 9% 6% and 5% of taxable income and
calculate and pay value-added tax based on the
difference after deducting the input VAT that is
allowed to be deducted in the current period.
13% 9% 6% Collection rate 5%
City maintaining &
construction tax
Turnover tax payable 7%
Corporation income
tax
Taxable income
Except for overseas subsidiaries which calculate and
pay the taxes according to the statutory tax rate of
the country or region where they are located the
corporate income tax of domestic companies is
calculated and paid at 15%、20% or 25% of thetaxable income.
Educational surtax Turnover tax payable 5% 4.5%
Disclose reasons for different taxpaying body
Taxpaying body Income tax rate
Weifu Mashan Weifu Chang’an Weifu International Trade Weifu Autocam Weifu Schmidt Autosmart
Seating、 Weifu Leader (Nanchang) Weifu Electric Drive Borit
25%
Weifu Leader (Wuhan) 20%
The Company Weifu Jinning Weifu Leader Weifu Tianli Weifu Leader (Chongqing) 15%
SPV IRD 22%
The Company Weifu Jinning Weifu Leader and Weifu Tianli are accredited as a high-tech enterprise in 2020
and enjoy a preferential income tax rate of 15% from 1 January 2020 to 31 December 2022.The State Administration of Taxation announced the first item of Announcement of the State Administration of
Taxation on the Enterprise Income Tax Issues Concerning the Implementation of the Western Development
Strategy No. 12 of 2012 that from January 1 2011 to December 31 2020 the enterprises located in the west
region and mainly engaged in the industrial projects stipulated in the Catalogue of Encouragement Industriesin
the Western Region and whose main business income accounting for more than 70% of the total income of the
enterprise in the current year can pay the corporate income tax at the tax rate of 15%. In 2020 Weifu Leader
(Chongqing) paid its corporate income tax at the tax rate of 15%.
According to the provision of the State Administration of Taxation on the Announced the Cancellation of 22 Tax
Non-administrative Review (No. 58 documents in 2015) dated 18 August 2015 the enterprise that benefit from
the 15% tax incentive for western development do not need to approve only to file and Weifu Leader (Chongqing)
has passed the tax filing audit in 2020.
In 2020 Weifu Leader (Wuhan) met the standards of small and low-profit enterprises and the part of taxable
income that did not exceed 1 million Yuan was included in the taxable incomeat a reduced rate of 25% and the
corporate income tax was paid at the tax rate of 20%; while the part of the taxable income exceeding 1 million
Yuan but not exceeding 3 million Yuan was included in the taxable income at a reduced rate of 50% and the
corporate income tax was paid at the tax rate of 20%.VII. Notes to major items in consolidated financial statements
1. Monetary funds
In RMB/CNY
Item Ending balance Opening balance
Cash on hand 507.66 93165.33
Cash in bank 1905945511.04 1531405488.52
Other Monetary funds 57343813.63 65395058.02
Total 1963289832.33 1596893711.87
Including: Total amount saving aboard 33723245.25 31442836.86
Total amount with restriction on use for mortgage pledge or freeze 57343813.63 34946900.21
Other explanation
The ending balance of other monetary funds includes bank acceptance bill deposit 51045344.11 Yuan Mastercard deposit
215720.00 Yuan in-transit foreign exchange funds 2656627.59 Yuan letter of credit guarantee deposit 587241.00 Yuan and
frozen dividends 2838880.93 Yuan. The in-transit foreign exchange fund of 2656627.59 Yuan is the final payment of the
investment in Protean Holding Corp; as of December 31 2020 the amount is still in the foreign exchange supervision account.The
frozen dividend of 2838880.93 Yuan represents the part of dividends distributed by SDEC(stock code:600841) and Miracle
Automation (stock code:002009) from 2017 to 2020 held by the Company as financial assets available for sale. According to the
notices numbered Yue 03MC [2016]2490 and Yue 03MC [2016]2492 served by Guangdong Shenzhen Intermediate People’s Court
these dividends were frozen.
2. Transaction financial asset
In RMB/CNY
Item Ending balance Opening balance
Financial assets measured at fair value and whose changes
are included in current profit or loss
3518432939.10 3940885674.32
Including:
SDEC 140395956.00 91822332.00
Miracle Automation 47712300.00 36031500.00
Financial products 3330324683.10 3813031842.32
Including:
Total 3518432939.10 3940885674.32
3. Note receivable
(1) Classification of notes receivable
In RMB/CNY
Item Ending balance Opening balance
Bank acceptance bill 1312571695.46 1755135175.42
Trade acceptance bill 344744028.10 57006196.52
Total 1657315723.56 1812141371.94
In RMB/CNY
Category
Ending balance Opening balance
Book balance
Bad debt
reserve
Book value
Book balance
Bad debt
reserve
Book
value
Amount Ratio
Amo
unt
Accru
al ratio
Amount Ratio
Amou
nt
Accru
al
ratio
Including:
Note receivable with
bad debt provision
accrual on portfolio
1657315723.56
100.00
%
1657315723
.56
1812141371.94
100.00
%
1812141
371.94
Including:
Portfolio 1: bank
acceptance bill
1312571695.46
79.20
%
1312571695
.46
1755135175.42
96.85
%
1755135
175.42
Portfolio 2: trade
acceptance bill
344744028.10
20.80
%
344744028.1
0
57006196.52 3.15%
5700619
6.52
Total 1657315723.56
100.00
%
1657315723
.56
1812141371.94
100.00
%
1812141
371.94
Statement of the basis for determining the combination:
On December 31 2020 the company accrued bad debt provisions according to the expected credit losses for the entire duration bank
acceptance bills and trade acceptance bill do not need to accrue bad debt provisions.The company believed that the bank acceptance
bills held did not have significant credit risk and would not cause significant losses due to bank defaults.The trade acceptance bill
held by the Company did not have significant credit risk because these bills were mainly issued by large state-owned enterprises and
listed companies with good reputation and based on historical experience there had been no major defaults so they did not accrue
bad debt provisions for the receivable bank acceptance bills and trade acceptance bill.If the provision for bad debts of note receivable is made in accordance with the general model of expected credit losses please refer to
the disclosure of other receivables to disclose related information about bad-debt provisions:
□ Applicable √ Not applicable
(2) Bad debt provision accrual collected or switch back
Provision for bad debts in the current period:
□ Applicable √ Not applicable
(3) Notes receivable already pledged by the Company at the end of the period
In RMB/CNY
Item Amount pledge at period-end
Bank acceptance bill 677962881.14
Trade acceptance bill 203951495.81
Total 881914376.95
(4) Notes endorsement or discount and undue on balance sheet date
In RMB/CNY
Item Amount derecognition at period-end Amount not derecognition at period-end
Bank acceptance bill 883989936.32
Trade acceptance bill 33750000.00
Total 917739936.32
(5) Notes transfer to account receivable due for failure implementation by drawer at period-end
In RMB/CNY
Item Amount transfer to account receivable at period-end
Trade acceptance bill 7300000.00
Total 7300000.00
Other explanation
The trade acceptance bill that the company transferred to the accounts receivable due to in 2018 the failure of the drawer to perform the
agreementat the end of the period were the bills of the subsidiaries controlled by Baota Petrochemical Group Co. Ltd. and the bills
accepted by Baota Petrochemical Group Finance Co. Ltd. (hereinafter referred to as “BDbills”); In 2018 the amount transferred to
account receivable was 7 million Yuan and 1.7 million Yuan has been recovered in 2019 this year an increase of 2 million Yuan
was added.
(6) Note receivable actually written-off in the period
Nil
4. Account receivable
(1) Classification of account receivable
In RMB/CNY
Category
Ending balance Opening balance
Book balance Bad debt reserve
Book value
Book balance Bad debt reserve
Book value
Amount Ratio Amount
Accr
ual
ratio
Amount
Rati
o
Amount
Accru
al
ratio
Account
receivable with
bad debt provision
accrual on a single
basis
80362095.35 2.74%
80362095.
35
100.
00%
64818802.1
4
2.58
%
64818802.14
100.00
%
Including:
Account
receivable with
bad debt provision
accrual on
portfolio
2847529398
.11
97.26
%
22749045.
70
0.80
%
28247803
52.41
244848681
2.37
97.4
2%
22804870.08 0.93%
2425681942.
29
Including:
Total
2927891493
.46
100.00
%
103111141
.05
3.52
%
28247803
52.41
251330561
4.51
100.
00%
87623672.22 3.49%
2425681942.
29
Bad debt provision accrual on single basis: RMB 80362095.35
In RMB/CNY
Name
Ending balance
Book balance Bad debt reserve
Accrual
ratio
Accrual causes
Hubei Meiyang Auto Industry Co. Ltd. 20139669.45 20139669.45 100.00% Have difficulty in collection
Hunan Leopaard Auto Co. Ltd. 8910778.54 8910778.54 100.00% Have difficulty in collection
BD bills 7300000.00 7300000.00 100.00% Have difficulty in collection
Jiangxi Dorcen Automobile Industry Co. Ltd. 7287632.16 7287632.16 100.00% Have difficulty in collection
Linyi Zotye Automobile components Manufacturing
Co. Ltd.
6193466.77 6193466.77 100.00% Have difficulty in collection
Changchun FAW Sihuan Engine Manufacturing Co.
Ltd
5852415.65 5852415.65 100.00% Have difficulty in collection
Tongling Ruineng Purchasing Co. Ltd. 4320454.34 4320454.34 100.00% Have difficulty in collection
Brilliance Automotive Group Holdings Co. Ltd. 3469091.33 3469091.33 100.00% Have difficulty in collection
Zhejiang Zotye Auto Manufacturing Co. Ltd. 3217763.27 3217763.27 100.00% Have difficulty in collection
Jiangxi Dorcen Automobile Co. Ltd. 2518959.01 2518959.01 100.00% Have difficulty in collection
Dongfeng Chaoyang Diesel Co. Ltd. 1953054.31 1953054.31 100.00% Have difficulty in collection
Jiangsu Kawei Auto Industrial Group Co. Ltd. 1932476.26 1932476.26 100.00% Have difficulty in collection
Wuxi Kipor Machinery Co. Ltd 1820798.21 1820798.21 100.00% Have difficulty in collection
Fujian Zhao’an Country Minyue Bianjie
Agricultural Machinery Automobile components
Co. Ltd.
1111007.12 1111007.12 100.00% Have difficulty in collection
Jiangsu Jintan Automobile Industry Co. Ltd. 1059798.43 1059798.43 100.00% Have difficulty in collection
Other custom 3274730.50 3274730.50 100.00% Have difficulty in collection
Total 80362095.35 80362095.35 -- --
Bad debt provision accrual on portfolio: RMB 22749045.70
In RMB/CNY
Name
Ending balance
Book balance Bad debt reserve Accrual ratio
Within 6 months 2708236852.25
6 months to one year 112424780.47 11242478.05 10.00%
1-2 years 16733198.33 3346639.68 20.00%
2-3 years 3291064.86 1316425.77 40.00%
Over 3 years 6843502.20 6843502.20 100.00%
Total 2847529398.11 22749045.70 --
If the provision for bad debts of accounts receivable is made in accordance with the general model of expected credit losses please refer
to the disclosure of other receivables to disclose related information about bad-debt provisions:
□ Applicable √ Not applicable
By account age
In RMB/CNY
Account age Book balance
Within one year (One year included) 2822428153.44
Including: within 6 months 2708470485.40
6 months to one year 113957668.04
1-2 years 54617379.30
2-3 years 35820608.24
Over 3 years 15025352.48
3-4 years 15025352.48
Total 2927891493.46
(2) Bad debt provision accrual collected or switch back
Bad debt provision accrual in the period:
In RMB/CNY
Category Opening balance
Amount changed in the period
Ending balance
Accrual
Collected or
reversal
Written-off Other
Bad debt
provision
87623672.22 17176890.53 931854.92 988058.21 230491.43 103111141.05
Total 87623672.22 17176890.53 931854.92 988058.21 230491.43 103111141.05
Important bad debt provision collected or switch back:
Nil
(3) Account receivable actual charge off in the Period
In RMB/CNY
Item Amount charge off
Anhui Quanchai Power Co. Ltd. 143750.00
Zhejiang Gonow Automobile Co. Ltd. 138571.90
Chongqing Tuopu Diesel Engine Factory 134197.30
Fuzhou Haominxing Automobile components Co. Ltd. 129739.47
Shanghai Yangma Generator Co. Ltd. 104496.00
Retail enterprise 337303.54
Total 988058.21
Major charge-off for the major receivable: Nil
Account receivable write-off explanation: the funds are not generated by connected transactions
(4) Top 5 receivables at ending balance by arrears party
In RMB/CNY
Name
Ending balance of account
receivable
Ratio in total ending balance of
account receivables
Ending balance of bad
debt reserve
Bosch Automobile Diesel System Co. Ltd. 549543387.12 18.77
Robert Bosch Company 205738695.62 7.03 84473.87
Custom 3 220253622.18 7.52 7236.15
Custom 4 183940277.82 6.28 85495.24
Custom 5 171736086.39 5.87 8253890.59
Total 1331212069.13 45.47
(5) Account receivable derecognition due to financial assets transfer
Nil
(6) Assets and liabilities resulted by account receivable transfer and continues involvement
Nil
5. Receivable financing
In RMB/CNY
Item Ending balance Opening balance
Including: bank acceptance bill 1005524477.88 23873317.86
Total 1005524477.88 23873317.86
Increase and decrease in current period and changes in fair value of receivables financing
□ Applicable √ Not applicable
If the bad debt provision for account receivable is calculated and withdrawn according to the general model of expected credit loss
please refer to the disclosure method of other account receivables in aspect of impairment provision:
□ Applicable √ Not applicable
Other explanation:
During the management of enterprise liquidity the company will discount or endorse transfers before the maturity of some bills the
business model for managing bills receivable is to collect contractual cash flows and sell the financial asset so it is classified as
financial assets measured at fair value and whose changes are included in other comprehensive income which is listed in receivables
financing.Notes receivable already pledged by the Company at the end of the period
Item Amount pledge at period-end
Bank acceptance bill 646892501.28
Trade acceptance bill --
Total 646892501.28
6. Account paid in advance
(1) Account age of account paid in advance
In RMB/CNY
Account age
Ending balance Opening balance
Amount Ratio Amount Ratio
Within one year 146877271.37 96.71% 118030952.47 84.77%
1-2 years 2799827.49 1.84% 19644713.49 14.11%
2-3 years 1254109.33 0.83% 683098.16 0.49%
Over 3 years 942149.57 0.62% 883153.66 0.63%
Total 151873357.76 -- 139241917.78 --
Explanation on reasons of failure to settle on important advance payment with age over one year:
Nil
(2) Top 5 account paid in advance at ending balance by prepayment object
Total year-end balance of top five account paid in advance by prepayment object amounted to 61951950.89 Yuan takes 40.79
percent of the total advance payment at year-end.
7. Other account receivables
In RMB/CNY
Item Ending balance Opening balance
Interest receivable 655052.98
Dividend receivable 49000000.00 1070000.00
Other account receivables 5209580.88 42004970.33
Total 54209580.88 43730023.31
(1) Interest receivable
1) Category of interest receivable
In RMB/CNY
Item Ending balance Opening balance
Interest of fund occupation 655052.98
Total 655052.98
2) Significant overdue interest
Nil
3) Accrual of bad debt provision
□ Applicable √ Not applicable
(2) Dividend receivable
1) Category of dividend receivable
In RMB/CNY
Item (or invested enterprise) Ending balance Opening balance
Wuxi Weifu Environment Catalyst Co. Ltd. 49000000.00
Weifu Precision Machinery Manufacturing Co. Ltd. 1070000.00
Total 49000000.00 1070000.00
2) Important dividend receivable with account age over one year
Nil
(3) Other account receivables
1) Other account receivables classification by nature
In RMB/CNY
Nature Ending book balance Opening book balance
Intercourse funds from units 35441483.88
Equity disposal fund of Protean Holdings Corp. 10654092.89
Cash deposit 5650143.62 3625917.96
Staff loans and petty cash 766301.05 1346241.81
Other 1651737.93 300206.93
Total 8068182.60 51367943.47
2) Accrual of bad debt provision
In RMB/CNY
Bad debt reserve
Phase I Phase II Phase III
Total
Expected credit
losses over next 12
months
Expected credit losses for the
entire duration (without credit
impairment occurred)
Expected credit losses for the
entire duration (with credit
impairment occurred)
Balance on Jan. 1 2020 7848301.94 1514671.20 9362973.14
Balance of Jan. 1 2020
in the period
—— —— —— ——
Current accrual 33302.78 31823.40 65126.18
Current reversal 5056807.33 68706.86 5125514.19
Current written-off 1445964.34 1445964.34
Other change 1980.93 1980.93
Balance on Dec. 31 2020 2826778.32 31823.40 2858601.72
Change of book balance of loss provision with amount has major changes in the period
□ Applicable √ Not applicable
By account age
In RMB/CNY
Account age Book balance
Within one year (One year included) 5306591.79
Within 6 months 4338058.39
6 months to one year 968533.40
1-2 years 80.00
2-3 years 47365.81
Over 3 years 2714145.00
3-4 years 2714145.00
Total 8068182.60
3) Bad debt provision accrual collected or switch back
Bad debt provision accrual in the period:
In RMB/CNY
Category
Opening
balance
Amount changed in the period
Ending balance
Accrual Collected or reversal Written-off Other
Bad debt
provision
9362973.14 65126.18 5125514.19 1445964.34 1980.93 2858601.72
Total 9362973.14 65126.18 5125514.19 1445964.34 1980.93 2858601.72
Including the important bad debt provision switch back or collected in the period: nil
4) Other receivables actually written-off during the reporting period
In RMB/CNY
Item Amount charge off
American HESS Company 1445964.34
Note of important other receivables of written-off:
Nil
5) Top 5 other receivables at ending balance by arrears party
In RMB/CNY
Enterprise Nature Ending balance Account age
Ratio in total ending
balance of other
receivables
Ending balance
of bad debt
reserve
Ningbo Jiangbei High-Tech Industry Park
Development Construction Co. Ltd.
Deposit
margin
1767000.00 Over 3 years 21.90% 1767000.00
Wuxi China Resources Gas Co. Ltd.
Deposit
margin
1026000.00 Within 6 months 12.73%
Zhenkunxing Industrial Supermarket
(Shanghai) Co. Ltd.
Deposit
margin
1000000.00 Within 6 months 12.39%
Chongqing Airport Group Co. Ltd.
Deposit
margin
636710.00
6 months to one
year
7.89% 63671.00
Nanjing Chimbusco City Gas
Development Co. Ltd.
Deposit
margin
575640.00 Over 3 years 7.13% 575640.00
Total -- 5005350.00 -- 62.04% 2406311.00
6) Other account receivables related to government grants
Nil
7) Other receivable for termination of confirmation due to the transfer of financial assets
Nil
8) The amount of assets and liabilities that are transferred other receivable and continued to be involved
Nil
8. Inventory
(1) Category of inventory
In RMB/CNY
Item Ending balance Opening balance
Book balance
Inventory
depreciation
reserve or
Provision for
impairment of
contract
performance
costs
Book value Book balance
Inventory
depreciation
reserve or
Provision for
impairment of
contract
performance
costs
Book value
Raw materials 584188987.86 73833368.32 510355619.54 495927678.66 81069128.03 414858550.63
Goods in process 415445852.86 14589096.65 400856756.21 243525007.82 13963866.92 229561140.90
Finished goods 2124817656.18 158847857.29 1965969798.89 1937368868.87 163043724.58 1774325144.29
Total 3124452496.90 247270322.26 2877182174.64 2676821555.35 258076719.53 2418744835.82
(2) Inventory depreciation reserve
In RMB/CNY
Item Opening balance
Current increased Current decreased
Ending balance
Accrual Other Switch back or write-off Other
Raw materials 81069128.03 32396791.38 318998.85 39951549.94 73833368.32
Goods in process 13963866.92 8567123.76 7941894.03 14589096.65
Finished goods 163043724.58 101436883.33 33853.67 105666604.29 158847857.29
Total 258076719.53 142400798.47 352852.52 153560048.26 247270322.26
① Net realizable value of the inventory refers to: during the day-to-day activities results of the estimated sale price less costs which
are going to happen by estimation till works completed sales price estimated and relevant taxes.
② Accrual basis for inventory depreciation reserve:
Cash on hand Accrual basis for inventory impairment
provision
Specific basis for recognition
Materials in stock
The materials sold due to finished goods
manufactured its net realizable value is
lower than the book value
Results from the estimated sale price of such inventory less the cost what
will happen estimated sales expenses and relevant taxes till the goods
completed
Goods in process
The goods in process sold due to
finished goods manufactured its net
realizable value is lower than the book
value
Results from the estimated sale price of such inventory less the cost what
will happen estimated sales expenses and relevant taxes till the goods
completed
Cash on hand
Accrual basis for inventory impairment
provision
Specific basis for recognition
③ Reasons of write-off for inventory falling price reserves:
Cash on hand Reasons of write-off
Materials in stock Used for production and the finished goods are realized sales
Goods in process Goods in process completed in the Period and corresponding finished goods are realized sales in the Period
Finished goods Sales in the Period
(3) Explanation on capitalization of borrowing costs at ending balance of inventory
Nil
(4) Assets completed without settlement from construction contract at period-end
Nil
9. Other current assets
In RMB/CNY
Item Ending balance Opening balance
Structured deposits 1925000000.00 965000000.00
Receivable export tax rebates 5286965.71 5383485.34
VAT refund receivable 1648669.86
Prepaid taxes and VAT retained 200524304.70 36067254.77
Input tax to be deducted and certification 178073.42 764895.21
Other 6931769.78 3191300.56
Total 2137921113.61 1012055605.74
Other explanation:
Nil
10. Long-term equity investments
In RMB/CNY
The invested
entity
Opening
balance
(book value)
Current changes (+ -)
Ending
balance
(book
value)
Ending
balance
of
depreciati
on
reserves
Additi
onal
invest
ment
Capital
reducti
on
Investme
nt
gain/loss
recognize
d under
equity
Other
comprehe
nsive
income
adjustmen
t
Other
equity
change
Cash
dividend
or profit
announce
d to
issued
Impairme
nt accrual
Other
I. Joint venture
II. Associated enterprise
Wuxi Weifu
Environment
Catalyst Co.
Ltd.
578366832.
27
1479503
44.01
4900000
0.00
6773171
76.28
Bosch
Automobile
Diesel System
Co. Ltd.
341709213
6.65
1185178
731.75
1801681
159.00
2800589
709.40
Zhonglian
Automobile
Electronic Co.
Ltd.
126123263
5.30
3077162
21.01
3314000
00.00
1237548
856.31
Weifu Precision
Machinery
Manufacturing
Co. Ltd.
61536602.8
2
1691746
7.83
3600000
.00
7485407
0.65
Shinwell
Automobile
Technology
(Wuxi) Co. Ltd.
4177746.31
-319499
6.20
982750.1
1
Changchun
Xuyang Weifu
Automobile
components
Technology Co.Ltd.
10200
000.0
0
-4271.78
1019572
8.22
Subtotal
532240595
3.35
10200
000.0
0
1654563
496.62
2185681
159.00
4801488
290.97
Total
532240595
3.35
10200
000.0
0
1654563
496.62
2185681
159.00
4801488
290.97
11. Other equity instrument investment
In RMB/CNY
Item Ending balance Opening balance
Wuxi Xidong Science & Technology Industrial Park 5000000.00 5000000.00
Beijing Zhike Industry Investment Holding Group Co. Ltd. 75940000.00 75940000.00
Rare earth Catalysis Innovation Research Institute (Dongying) Co. Ltd. 4108000.00 4108000.00
Wuxi Xichang Microchip Semi-Conductor 200000000.00 200000000.00
Total 285048000.00 285048000.00
Disclosure of the non-trading equity instrument investment item by item
Nil
12. Other non-current financial assets
In RMB/CNY
Item Ending balance Opening balance
Tradable financial assets holding for over one year 1467000000.00 1000246703.43
Equity instrument investment 338788421.00 43343284.00
Total 1805788421.00 1043589987.43
13. Investment real estate
(1) Investment real estate measured by cost
√ Applicable □ Not applicable
In RMB/CNY
Item House and Building Land use right
Construction in
progress
Total
I. original book value
1.Opening balance 65524052.61 65524052.61
2.Current increased
(1) outsourcing
(2) Inventory\fixed
assets\construction in process transfer-in
(3) increased by combination
3.Current decreased
(1) disposal
(2) other transfer-out
4.Ending balance 65524052.61 65524052.61
II. Accumulated depreciation and
accumulated amortization
1.Opening balance 43113540.74 43113540.74
2.Current increased 1523830.25 1523830.25
(1) accrual or amortization 1523830.25 1523830.25
3.Current decreased
(1) disposal
(2) other transfer-out
4.Ending balance 44637370.99 44637370.99
III. Depreciation reserves
1.Opening balance
2.Current increased
(1) accrual
3. Current decreased
(1) disposal
(2) other transfer-out
4.Ending balance
IV. Book value
1.Ending Book value 20886681.62 20886681.62
2.Opening Book value 22410511.87 22410511.87
(2) Investment real estate measured at fair value
□ Applicable √ Not applicable
(3) Investment real estate without property certification held
Nil
14. Fixed assets
In RMB/CNY
Item Ending balance Opening balance
Fixed assets 2882230191.08 2845176078.20
Total 2882230191.08 2845176078.20
(1) Fixed assets
In RMB/CNY
Item
House and
Building
Machinery
equipment
Transportation
equipment
Electronic and other
equipment
Total
I. original book value:
1.Opening balance 1577727234.03 2892177324.22 33031605.81 518844612.28 5021780776.34
2.Current increased 7563975.38 498442904.87 1083968.58 44140463.89 551231312.72
(1) Purchase 5768487.05 5779483.65 11547970.70
(2) Construction in
progress transfer-in
7563975.38 406156147.42 1083968.58 26833999.90 441638091.28
(3) increased by
combination
86518270.40 11526980.34 98045250.74
3.Current decreased 696619.88 32375566.33 3834292.89 31182407.69 68088886.79
(1) disposal or scrapping 696619.88 32375566.33 3834292.89 31182407.69 68088886.79
4.Conversion of foreign
currency financial statement
1445729.23 209033.22 1654762.45
5.Ending balance 1584594589.53 3359690391.99 30281281.50 532011701.70 5506577964.72
II. Accumulated depreciation
1.Opening balance 373468771.98 1466289636.27 24572383.79 259549999.99 2123880792.03
2.Current increased 47226786.07 341600542.42 1505443.82 50929896.22 441262668.53
(1) accrual 47226786.07 295932176.04 1505443.82 44560750.98 389225156.91
(3) increased by
combination
45668366.38 6369145.24 52037511.62
3.Current decreased 552514.41 7100470.77 3475517.46 19546483.92 30674986.56
(1) disposal or scrapping 552514.41 7100470.77 3475517.46 19546483.92 30674986.56
4.Conversion of foreign
currency financial statement
833283.96 135316.83 968600.79
5.Ending balance 420143043.64 1801622991.88 22602310.15 291068729.12 2535437074.79
III. Depreciation reserves
1.Opening balance 45370341.62 73319.90 7280244.59 52723906.11
2.Current increased 36436674.38 36436674.38
(1) accrual 36436674.38 36436674.38
3.Current decreased 35943.60 213938.04 249881.64
(1) disposal or scrapping 35943.60 213938.04 249881.64
4.Conversion of foreign
currency financial statement
5.Ending balance 81771072.40 73319.90 7066306.55 88910698.85
IV. Book value
1.Ending Book value 1164451545.89 1476296327.71 7605651.45 233876666.03 2882230191.08
2.Opening Book value 1204258462.05 1380517346.33 8385902.12 252014367.70 2845176078.20
(2) Temporarily idle fixed assets
Nil
(3) Fixed assets acquired by financing lease
In RMB/CNY
Item Original book value
Accumulated
depreciation
Provision for impairment Book value
Mechanical equipment 28328331.83 16449611.12 11878720.71
(4) Fixed assets acquired by operating lease
Nil
(5) Fixed assets without property certification held
In RMB/CNY
Item Book value Reasons for without the property certification
Plant and office building of Weifu Chang’an 34117284.65 Still in process of relevant property procedures
(6) Disposal of fixed assets
Nil
15. Construction in progress
In RMB/CNY
Item Ending balance Opening balance
Construction in progress 243795493.04 247857777.25
Total 243795493.04 247857777.25
(1) Construction in progress
In RMB/CNY
Item
Ending balance Opening balance
Book balance
Depreciation
reserves
Book value Book balance
Depreciation
reserves
Book value
Technical transformation
of parent company
123249079.40 123249079.40 98032515.22 98032515.22
Technical transformation
of Weifu Autocam
20720304.97 20720304.97 44412832.62 44412832.62
Technical transformation
of Weifu Leader
27031547.25 27031547.25 25051156.03 25051156.03
Other item 72794561.42 72794561.42 80361273.38 80361273.38
Total 243795493.04 243795493.04 247857777.25 247857777.25
(2) Changes of major projects under construction
In RMB/CNY
Item
Bu
dge
t
Opening
balance
Current
increased
Fixed
assets
transfer-in
in the
Period
Other
decreased
in the
Period
Ending
balance
Proportio
n of
project
investme
nt in
budget
Prog
ress
Accumu
lated
amount
of
interest
capitaliz
ation
includin
g:
interest
capitaliz
ed
amount
of the
year
Intere
st
capita
lizatio
n rate
of the
year
Source
of funds
Technical
transformation
of parent
company
98032515
.22
25824801
1.11
23303144
6.93
12324907
9.40
Other
Technical
transformation
of Weifu
Autocam
44412832
.62
59344058
.68
83036586
.33
20720304
.97
Other
Technical
transformation
of Weifu
Leader
25051156
.03
49714021
.24
47733630
.02
27031547
.25
Other
Total
16749650
3.87
36730609
1.03
36380166
3.28
17100093
1.62
-- -- --
(3) The provision for impairment of construction projects
Nil
(4) Engineering materials
Nil
16. Intangible assets
(1) Intangible assets
In RMB/CNY
Item Land use right Patent
Non-patent
technology
Computer
software
Trademark and
trademark license
Total
I. original book value
1.Opening balance 380986757.11 105086673.46 81823603.48 41597126.47 609494160.52
2.Current increased 25763.33 75384836.56 15790128.41 91200728.30
(1) Purchase 2842372.92 15019691.80 17862064.72
(2) internal R&D
(3) increased by
combination
72542463.64 770436.61 73312900.25
(4) Other 25763.33 25763.33
3.Current decreased
(1) disposal
4.Conversion of foreign
currency financial
statement
4607818.10 71130.87 4678948.97
5.Ending balance 381012520.44 185079328.12 97684862.76 41597126.47 705373837.79
II. accumulated
amortization
1.Opening balance 88200675.16 9823965.21 54519248.03 9709000.00 162252888.40
2.Current increased 7052263.90 44226916.11 19718966.93 70998146.94
(1) accrual 7052263.90 11059695.32 19034067.57 37146026.79
(2) Increased by
combination
33167220.79 684899.36 33852120.15
3.Current decreased
(1) disposal
4.Conversion of foreign
currency financial
statement
1027211.35 35743.41 1062954.76
5.Ending balance 95252939.06 55078092.67 74273958.37 9709000.00 234313990.10
III. Depreciation reserves
1.Opening balance 16646900.00 16646900.00
2.Current increased
(1) accrual
3.Current decreased
(1) disposal
4.Conversion of foreign
currency financial
statement
5.Ending balance 16646900.00 16646900.00
IV. Book value
1.Ending Book value 285759581.38 130001235.45 23410904.39 15241226.47 454412947.69
2.Opening Book value 292786081.95 95262708.25 27304355.45 15241226.47 430594372.12
(2) Land use right without property certification held
Nil
17. Goodwill
(1) Original book value of goodwill
In RMB/CNY
The invested entity or
matters forming
goodwill
Opening balance
Current increased Current decreased
Ending balance Formed by business
combination
Translation of foreign
currency statements
Disposal
Merged with Weifu
Tianli
1784086.79 1784086.79
Merged with Borit 247766648.21 8249961.32 256016609.53
Total 1784086.79 247766648.21 8249961.32 257800696.32
(2) Goodwill depreciation reserves
Nil
Other explanation
(1) Goodwill formed by the merger of Weifu Tianli:
In 2010 the Company controlling and combine Weifu Tianli by increasing the capital the goodwill is the number
that combination cost greater than the fair value of identical net assets of Weifu Tianli. At the end of the period the
company conducted an impairment test on goodwill to estimate the present value of future cash flows and the
recoverable amount of the goodwill-related asset group that is to estimate the present value of future cash flow
based on the management's financial budget for the next five years and the discount rate of 15.05% the cash flow of
the year after the five years of financial budget has remained stable. The asset group identified during the goodwill
impairment test did not change.The key parameters determined by the goodwill impairment test are as follows: The
current value of the expected future cash flow of the asset group related to goodwill is measured by using 20%~24%
of gross profit margin and 4%~14% of the operating income growth rate in the forecast period as key parameters.The management determines these parameters based on historical conditions prior to the forecast period and
forecasts of market development. After the above tests the company's goodwill does not need to make provisions
for impairment.
(2) Goodwill formed by the merger of Borit:
In this period the company acquired 100.00% equity of Borit in the form of cash purchase the goodwill was the
part that the cost of the merger was greater than the fair value share of the identifiable net assets of
Borit.According to the “Assets Appraisal Report” (Wanlong PBZi (2021) No. 40016) issued by Wanlong
(Shanghai) Assets Appraisal Co. Ltd appointed by the Company the recoverable value of the assets group where
the goodwill of the merged with Borit is 439880000 Yuan higher than the carrying value of 339170000 Yuan
and there is no impairment loss of goodwill.
18. Long-term deferred expenses
In RMB/CNY
Item Opening balance Current increased
Amortized in the
Period
Other decrease Ending balance
Remodeling costs etc. 18536000.25 9164129.72 12637958.88 15062171.09
Total 18536000.25 9164129.72 12637958.88 15062171.09
19. Deferred income tax assets/Deferred income tax liabilities
(1) Deferred income tax assets that are not offset
In RMB/CNY
Item
Ending balance Opening balance
Deductible temporary
difference
Deferred income tax
assets
Deductible temporary
difference
Deferred income
tax assets
Bad debt reserve 104259030.38 15779756.63 94527571.76 14302572.39
Inventory depreciation reserve 225684043.14 35799261.60 237900564.04 38773864.59
Depreciation reserves of fixed assets 55397599.68 8523566.97 19197534.00 3095824.19
Depreciation reserves of intangible
assets
16646900.00 2497035.00 16646900.00 2497035.00
Other equity instrument investment 10000000.00 1500000.00 10000000.00 1500000.00
Change of fair value of transaction
financial asset
16517403.00 2477610.45
Deferred income 323924836.18 48935725.44 362993022.12 54664953.32
Internal un-realized profit 19551845.38 3457610.51 22481656.04 4568190.39
Payable salary accrued expenses etc. 981477549.10 151813641.23 622348855.94 96720511.00
Depreciation assets amortization
difference
89867140.23 14608530.41 49220776.87 7779059.56
Deductible loss of subsidiary 9703095.17 2425773.79 21714524.19 4101171.83
Equity incentive 6330515.63 987908.92
Total 1842842554.89 286328810.50 1473548807.96 230480792.72
(2) Deferred income tax liabilities that are not offset
In RMB/CNY
Item
Ending balance Opening balance
Taxable temporary
differences
Deferred income
tax liabilities
Taxable temporary
differences
Deferred income
tax liabilities
The difference between the fair value and
taxation basis of Weifeu Tianli assets in a
merger not under the same control
11271189.48 1690678.40 12011409.46 1801711.40
The difference between the fair value and
taxation basis of IRD assets in a merger not
under the same control
86905585.08 19119228.72 94383365.10 20764340.32
The difference between the fair value and
taxation basis of Borit assets in a merger not
under the same control
39376104.10 9844026.00
Change of fair value of transaction financial
asset
366808362.19 55023506.38 18231842.32 2734776.35
Accelerated depreciation of fixed assets 211571729.76 32911802.62 98019924.32 15269514.83
Total 715932970.61 118589242.12 222646541.20 40570342.90
(3) Deferred income tax assets and deferred income tax liabilities listed after off-set
In RMB/CNY
Item
Trade-off between the
deferred income tax
assets and liabilities
Ending balance of
deferred income tax
assets or liabilities after
off-set
Trade-off between the
deferred income tax
assets and liabilities at
period-begin
Opening balance of
deferred income tax
assets or liabilities after
off-set
Deferred income tax
assets
-87935309.00 198393501.50 -18004291.18 212476501.54
Deferred income tax
liabilities
-87935309.00 30653933.12 -18004291.18 22566051.72
(4) Details of unrecognized deferred income tax assets
In RMB/CNY
Item Ending balance Opening balance
Bad debt reserve 1710712.39 2459073.60
Inventory depreciation reserve 21586279.12 20176155.49
Loss from subsidiary 193713240.35 103734801.82
Depreciation reserves of fixed assets 33513099.17 33526372.11
Other equity instrument investment 46600000.00 48633106.95
Equity incentive 154321.87
Total 297277652.90 208529509.97
(5) Deductible losses of un-recognized deferred income tax assets expired on the followed year
In RMB/CNY
Maturity year Ending amount Opening amount Note
2020 23567088.89 44795747.87 Subsidiaries have operating losses
2021 43218245.04 46080956.48 Subsidiaries have operating losses
2022 9901777.74 10503882.86 Subsidiaries have operating losses
2023 7882026.39 12228941.56 Subsidiaries have operating losses
2024 19165663.76 Subsidiaries have operating losses
2025 Subsidiaries have operating losses
No expiration period Overseas subsidiaries have operating losses
Total 103734801.82 139281223.32 --
20. Other non-current assets
In RMB/CNY
Item
Ending balance Opening balance
Book balance
Provision for
impairment
Book value Book balance
Provision for
impairment
Book value
Engineering equipment
paid in advance
195259441.73 195259441.73 230235982.45 230235982.45
Total 195259441.73 195259441.73 230235982.45 230235982.45
21. Short-term borrowings
(1) Category of short-term borrowings
In RMB/CNY
Item Ending balance Opening balance
Credit loan 301958184.49 305835808.28
Bill financing 5976347.95
Accrued interest 280415.56 341813.58
Total 302238600.05 312153969.81
Explanation of short-term loan classification:
Nil
(2) Overdue short-term loans without payment
Nil
22. Note payable
In RMB/CNY
Category Ending balance Opening balance
Bank acceptance bill 2462592372.82 1745218439.52
Total 2462592372.82 1745218439.52
Notes expired at year-end without paid was 0.00 Yuan.
23. Account payable
(1) Account payable
In RMB/CNY
Item Ending balance Opening balance
Within 1 year 3986993867.21 3214392402.81
1-2 years 87605077.14 74021217.00
2-3 years 13824720.43 5854811.50
Over three years 12560575.61 17985798.53
Total 4100984240.39 3312254229.84
(2) Important account payable with account age over one year
Nil
24. Accounts received in advance
(1) Accounts received in advance
In RMB/CNY
Item Ending balance Opening balance
Within 1 year 4071236.87 2862682.00
Total 4071236.87 2862682.00
(2) Important accounts received in advance with account age over one year
Nil
25. Contract liabilities
In RMB/CNY
Item Ending balance Opening balance
Within 1 year 77554320.04 96736917.15
1-2 years 2763605.96 654710.65
2-3 years 255602.59 243585.27
Over three years 1143858.66 930400.47
Total 81717387.25 98565613.54
26. Wage payable
(1) Wage payable
In RMB/CNY
Item Opening balance Current increased Current decreased Ending balance
I. Short-term compensation 161202257.62 1106707656.84 1083683592.15 184226322.31
II. Post-employment welfare- defined
contribution plans
27587740.03 119822883.92 97479526.53 49931097.42
III. Dismissed welfare 2249529.82 3660684.94 4264943.44 1645271.32
IV. Other welfare due within one
year
106180000.00 81282389.60 103312389.60 84150000.00
V. Other short-term
welfare-Housing subsidies
employee benefits and welfare
funds
17124210.19 2525946.49 7181035.91 12469120.77
Total 314343737.66 1313999561.79 1295921487.63 332421811.82
(2) Short-term compensation
In RMB/CNY
Item Opening balance Current increased Current decreased Ending balance
1. Wages bonuses allowances and
subsidies
141247196.85 884495041.97 870419048.20 155323190.62
2. Welfare for workers and staff 76357049.59 76356937.24 112.35
3. Social insurance 8701447.13 58977737.95 50181099.40 17498085.68
Including: Medical insurance 7575173.65 49025390.01 42349121.51 14251442.15
Work injury insurance 541230.02 3737106.50 2616665.94 1661670.58
Maternity insurance 585043.46 6215241.44 5215311.95 1584972.95
4. Housing accumulation fund 679677.00 70474436.00 70137926.00 1016187.00
5. Labor union expenditure and
personnel education expense
10573936.64 15610566.19 15817413.27 10367089.56
6. Short-term paid absences 792825.14 771168.04 21657.10
Total 161202257.62 1106707656.84 1083683592.15 184226322.31
(3) Defined contribution plans
In RMB/CNY
Item Opening balance Current increased Current decreased Ending balance
1. Basic endowment insurance 9782749.83 73994787.03 53932701.22 29844835.64
2. Unemployment insurance 412974.22 2215497.53 1715942.59 912529.16
3. Enterprise annuity 17392015.98 43612599.36 41830882.72 19173732.62
Total 27587740.03 119822883.92 97479526.53 49931097.42
Other explanation:
Reclassification of long-term staff remuneration payable:
①An amount of RMB 223910852.76 in short-term remuneration is reclassified into long-term staff remuneration
payable which represents the incentive fund of RMB 223910852.76 provided for in this period.
②An amount of RMB97723894.49 is recorded in post office benefits - defined benefit plan and incentive fund
payable within one year which represents the difference between the incentive fund of RMB101270000.00
expected to be paid in 2021 and the beginning balance of incentive fund payable within one year post office
benefits-defined benefit plan and the actual amount paid in this period.Post-employment welfare- defined contribution plans:
The Company participates in the pension insurance and unemployment insurance plans established by government
authorities by laws a certain percentage of the social security fee regulated by the government will pay by the
Company monthly for the plans.Other than the aforesaid monthly contribution the Company takes no further
payment obligation. The relevant expenditure is included in current profit or loss or cost of relevant assets whenoccurs. Found more of enterprise annuity in Note XVI-4.” Annuity plan”
(4) Dismiss welfare
The wages payable resulted from the implementation of inner retirement plan the amount paid in the year RMB
2598717.94 re-classified into the wage payable from long-term wages payable.
27. Taxes payable
In RMB/CNY
Item Ending balance Opening balance
Value-added tax 28744351.90 61749095.75
Corporation income tax 21458320.79 50686013.43
Individual income tax 7184934.79 2689642.51
City maintaining & construction tax 1983996.80 4348399.47
Educational surtax 1417140.56 3105999.62
Other (including stamp tax and local funds) 6704945.45 6959261.08
Total 67493690.29 129538411.86
28. Other account payable
In RMB/CNY
Item Ending balance Opening balance
Interest payable 4862.22
Other accounts payable 361551395.20 65266262.39
Total 361556257.42 65266262.39
(1) Interest payable
In RMB/CNY
Item Ending balance Opening balance
Other 4862.22
Total 4862.22
Major overdue interest:
Nil
(2) Dividend payable
Nil
(3) Other account payable
1) Classification of other accounts payable according to nature of account
In RMB/CNY
Item Ending balance Opening balance
Deposit and margin 12759592.29 14458865.71
Social insurance and reserves funds that withholding 8853543.93 8434584.35
Intercourse funds of unit 30982145.98 37055997.50
Restricted stock repurchase obligations 302479200.00
Other 6476913.00 5316814.83
Total 361551395.20 65266262.39
2) Significant other payable with over one year age
In RMB/CNY
Item Ending balance Reasons for non-repayment or carry-over
Nanjing Jidian Industrial Group Co. Ltd. 4500000.00 Intercourse funds
Total 4500000.00 --
29. Non-current liabilities due within one year
In RMB/CNY
Item Ending balance Opening balance
Long-term borrowings due within one year 33271589.84
Finance lease payments due within one year 3615985.51
Interest payable 26666.67
Total 36914242.02
30. Other current liabilities
In RMB/CNY
Item Ending balance Opening balance
Rebate payable 213477951.00 115015466.40
Pending sales tax 9393136.33 12309137.07
Total 222871087.33 127324603.47
Changes in short-term bonds payable:
Nil
31. Long-term borrowings
(1) Category of Long-term borrowings
In RMB/CNY
Item Ending balance Opening balance
Guaranteed loan 3050640.97
Total 3050640.97
Explanation of long-term loan classification:Nil
32. Long-term account payable
In RMB/CNY
Item Ending balance Opening balance
Long-term account payable 15351883.00 16843181.00
Special accounts payable 24127335.17 18265082.11
Total 39479218.17 35108263.11
(1) Long-term account payable listed by nature
In RMB/CNY
Item Ending balance Opening balance
Hi-tech Branch of Nanjing Finance Bureau (note ①) Financial support funds (2005) 1140000.00
Hi-tech Branch of Nanjing Finance Bureau (note ②) Financial support funds (2006) 1250000.00 1250000.00
Hi-tech Branch of Nanjing Finance Bureau (note ③) Financial support funds (2007) 1230000.00 1230000.00
Loan transferred from treasury bond (note ④) 339090.00 678181.00
Hi-tech Branch of Nanjing Finance Bureau (note ⑤) Financial support funds (2008) 2750000.00 2750000.00
Hi-tech Branch of Nanjing Finance Bureau (note ⑥) Financial support funds (2009) 1030000.00 1030000.00
Hi-tech Branch of Nanjing Finance Bureau (note ⑦) Financial support funds (2010) 960000.00 960000.00
Hi-tech Branch of Nanjing Finance Bureau (note ⑧) Financial support funds (2011) 5040000.00 5040000.00
Hi-tech Branch of Nanjing Finance Bureau (note ⑨) Financial support funds (2013) 2740000.00 2740000.00
Total 15339090.00 16818181.00
Other explanation:
Note ①: To encourage Weifu Jinning to enter Nanjing High-tech Technology Industry Development Zone
financial supporting capital is allotted by High-tech branch of Finance Bureau of Nanjing for supporting use the
term is from 20 October 2005 to 20 October 2020. Provided that the operation period in the zone is less than 15
years financial supporting capital will be reimbursed. This support fund has expired fifteen years in the current
period so it is transferred to other income.Note ②: To encourage Weifu Jinning to enter Nanjing High-tech Technology Industry Development Zone
financial supporting capital is allotted by High-tech branch of Finance Bureau of Nanjing for supporting use the
term is from 20 July 2006 to 20 July 2021. Provided that the operation period in the zone is less than 15 years
financial supporting capital will be reimbursed.Note ③: To encourage Weifu Jinning to enter Nanjing High-tech Technology Industry Development Zone
financial supporting capital is allotted by High-tech branch of Finance Bureau of Nanjing for supporting use
the term is from 17 September 2007 to 17 September 2022. Provided that the operation period in the zone is
less than 15 years financial supporting capital will be reimbursed.Note ④: Loan transferred from treasury bond: Weifu Jinning received RMB1.87 million Yuan of special funds
from budget of the central government and RMB1.73 million Yuan of special funds from budget of the local
government. The non-operating income transferred in was 1.87 million Yuan in 2011 which was confirmed not to
return if the Company pays back special funds of 3.73 million Yuan to the local government in 11 years since
2012 then the Company needs to repay the principal of 339091.00 Yuan each year.
Note ⑤: To encourage Weifu Jinning to enter Nanjing High-tech Technology Industry Development Zone
financial supporting capital is allotted by High-tech branch of Finance Bureau of Nanjing for supporting use
the term is from 10 November 2008 to 10 November 2023. Provided that the operation period in the zone is
less than 15 years financial supporting capital will be reimbursed.Note ⑥: To encourage Weifu Jinning to enter Nanjing High-tech Technology Industry Development Zone
financial supporting capital is allotted by High-tech branch of Finance Bureau of Nanjing for supporting use the
term is from 27 October 2009 to 27 October 2024. Provided that the operation period in the zone is less than 15
years financial supporting capital will be reimbursed.Note ⑦: To encourage Weifu Jinning to enter Nanjing High-tech Technology Industry Development Zone
financial supporting capital is allotted by High-tech branch of Finance Bureau of Nanjing for supporting use
the term is from 27 December 2010 to 27 December 2025. Provided that the operation period in the zone is less
than 15 years financial supporting capital will be reimbursed.Note ⑧: To encourage Weifu Jinning to enter Nanjing High-tech Technology Industry Development Zone
financial supporting capital is allotted by High-tech branch of Finance Bureau of Nanjing for supporting use the
term is from 28 December 2011 to 28 December 2026. Provided that the operation period in the zone is less than
15 years financial supporting capital will be reimbursed.
Note ⑨: To encourage Weifu Jinning to enter Nanjing High-tech Technology Industry Development Zone
financial supporting capital is allotted by High-tech branch of Finance Bureau of Nanjing for supporting use the
term is from 18 December 2013 to 18 December 2028. Provided that the operation period in the zone is less than
15 years financial supporting capital will be reimbursed.
(2) Special accounts payable
In RMB/CNY
Item Opening balance Current increased Current decreased Ending balance Cause of formation
Removal compensation of
subsidiary Weifu Jinning
18265082.11 18265082.11
Finance lease payments 5862253.06 5862253.06
Total 18265082.11 5862253.06 24127335.17 --
Other explanation:
In line with regulation of the house acquisition decision of People’s government of Xuanwu District Nanjing City
Ning Xuan Fu Zheng Zi (2012) No.001 part of the lands and property of Weifu Jingning needs expropriation in
order to carry out the comprehensively improvement of Ming Great Wall. According to the house expropriation
and compensation agreement in state-owned lands signed between Weifu Jinning and House Expropriation
Management Office of Xuanwu District Nanjing City RMB 19.7067 million in total are compensate including
operation losses from lessee RMB 1.4416 million in total. The above compensation was received in last period
and is making up for the losses from lessee and the above lands and property have not been collected up to 31
December 2020.
33. Long-term wages payable
(1) Long-term wages payable
In RMB/CNY
Item Ending balance Opening balance
I. Post-employment welfare-defined contribution plans net indebtedness 0 0
II. Dismiss welfare 5734948.91 8333666.85
III. Other long-term welfare 176245345.03 50058386.76
Total 181980293.94 58392053.61
(2) Changes in defined benefit plans
Nil
34. Deferred income
In RMB/CNY
Item Opening balance Current increased Current decreased Ending balance Cause of formation
Government grand 365116022.98 24216119.46 61127665.71 328204476.73
Total 365116022.98 24216119.46 61127665.71 328204476.73 --
Item with government grants involved:
In RMB/CNY
Item
Opening
balance
New grants in
the Period
Amount
reckone
d in
non-ope
ration
revenue
Amount
reckoned into
other income
in the period
Cost
reductio
n in the
period
Other
changes
Ending balance
Assets
related/In
come
related
Industrialization
project for injection
VE pump system with
electronically
controlled high
pressure for
less-emission diesel
used
2163000.86 721000.30 1442000.56
Assets
related/In
come
related
Appropriation on
reforming of
production line
technology and R&D
ability of common rail
system for diesel by
distributive
high-voltage
7100000.00 7100000.00
Assets
related
Fund of industry
upgrade (2012)
26657526.17 26015356.44 642169.73
Income
related
Fund of industry
upgrade (2013)
60520000.00 60520000.00
Income
related
Appropriation on
central basic
construction
investment
1428571.45 714285.72 714285.73
Assets
related
R&D and
industrialization of the
high-pressure variable
pump of the common
rail system of diesel
engine for automobile
6870714.16 1543095.28 5327618.88
Assets
related
Research institute of
motor vehicle exhaust
aftertreatment
technology
1836712.58 622985.37 1213727.21
Assets
related
Fund of industry
upgrade (2014)
36831000.00 36831000.00
Income
related
New-built assets
compensation after the
removal of parent
company
124849393.92 20764119.52 104085274.40
Assets
related
Fund of industry
upgrade (2016)
40000000.00 40000000.00
Income
related
Guiding capital for the
technical reform from
State Hi-Tech
Technical
Commission
8147430.27 1552110.44 6595319.83
Assets
related
Implementation of the
variable cross-section
turbocharger for diesel
engine
8972771.42 1609982.67 7362788.75
Assets
related
Demonstration project
for intelligent
manufacturing
1148441.34 299341.74 849099.60
Assets
related
The 2nd batch of
provincial special
funds for industry
transformation of
industrial and
information in 2019
5000000.00 5000000.00
Assets
related
Municipal
technological reform
fund allocation in
2020
4770000.00 4770000.00
Assets
related
Strategic cooperation
agreement funding for
key enterprise of
smart manufacturing
in high-tech zone
4060000.00 4060000.00
Assets
related
Other 38590460.81 9139181.27 7285388.23 1246938.19 41691192.04
Assets
related/In
come
related
Total 365116022.98 22969181.27 61127665.71 1246938.19 328204476.73
Other explanation:
(1) Appropriation on industrialization project of electrical control and high voltage jet VE system of lowemissions diesel: in September 2009 Weifu Jinning signed “Project Contract of Technology OutcomeTransferring Special Capital in Jiangsu Province” with Nanjing Technical Bureau according to which Weifu
Jinning received appropriation 6.35 million Yuan in 2009 4.775 million Yuan received in 2010 and 0.875 million
Yuan received in 2011. According to the contract the attendance date of this project was: from October of 2009 to
March of 2012. This contract agreed 62% of newly increased investment in project would be spent in fixed assets
investment which are belongs to the government grand with assets/income concerned. In 2013 accepted by the
science & technology agency of Jiangsu Province and 4789997.04Yuan with income related was reckoned into
current operation revenue directly; the 7210002.96Yuan with assets related was amortized during the predicted
service period of the assets and 721000.30Yuan amortized in the Period.
(2) The appropriation for research and development ability of distributive high-pressure common rail system for
diesel engine use and production line technological transformation project: according to XCJ No. [2010] 59 the
Company has received special funds of 7.1 million Yuan appropriated by Finance Bureau of Wuxi New District in
2011 and used for the Company’s research and development ability of distributive high-pressure common rail
system for diesel engine use and production line technological transformation project; this appropriation belongs
to government subsidies related to assets and will be amortized according to the depreciation process of the
underlying assets when the project is completed.
(3) Industry upgrading funds (2012): In accordance with the document Xi Xin Guanjing Fa [2012] No.216 and
Document Xi Xin Guancai Fa [2012] No. 85 the Company received funds of 60.4 million Yuan appropriated for
industry upgrading this year. Current write off: 26015356.44Yuan.
(4) Industry upgrading funds (2013): In accordance with the document Xi Xin Guan Jing Fa [2013] No.379 Xi
Xin Guan Jing Fa [2013] No.455 Xi Xin Guan Cai Fa [2013] No.128 and Xi Xin Guan Cai Fa [2013] No.153 the
Company received funds of 60.52 million Yuan appropriated for industry upgrading in 2013.
(5) Appropriation for investment of capital construction from the central government: In accordance with the
document Xi Caijian [2012] No.43 the Company received appropriation of 5 million Yuan for investment of
capital construction from the central government in 2012. The project has passed the acceptance check in current
period this appropriation should be amortized within the surplus service life of current assets and amortization
amount of current period is 714285.71 Yuan.
(6) R&D and industrialization of the high pressure variable pump of the common rail system of diesel engine for
automobile: the Company received appropriated for the project in 2013 with 8.05 million Yuan in line with
documents of Xi Ke Ji [2013] No.186 Xi Ke Ji [2013] No.208 Xi Cai Gong Mao [2013] No.104 Xi Cai Gong
Mao [2013] No.138 Xi Ke Ji [2014] No.125 Xi Cai Gong Mao [2014] No.58 Xi Ke Ji [2014] No. 246 and Xi
Cai Gong Mao [2014] No.162. Received 3 million Yuan in 2014 and 0.45 million Yuan in 2015; and belongs to
government grant with assets concerned and shall be amortized according to the depreciation process amount of
1543095.28 Yuan amortizes in the year.
(7) Vehicle exhaust after-treatment technology research institute project: in 2012 the subsidiary Weifu Leader has
applied for equipment purchase assisting funds to Wuxi Huishan Science and Technology Bureau and Wuxi
Science and Technology Bureau for the vehicle exhaust after-treatment technology research institute project. This
declaration has been approved by Wuxi Huishan Science and Technology Bureau and Wuxi Science and
Technology Bureau in 2012 and the company has received appropriation of 2.4 million Yuan in 2012 and
received appropriation of 1.6 million Yuan in 2013. This appropriation belongs to government subsidies related to
assets and will be amortized according to the depreciation process amount of 622985.37 Yuan amortizes in the
year.
(8) Industry upgrading funds (2014): In accordance with the document Xi Xin Guan Jing Fa [2014] No.427 and
Xi Xin Guan Cai Fa [2014] No.143 the Company received funds of 36.831 million Yuan appropriated for
industry upgrading in 2014.
(9) New-built assets compensation after the removal of parent company: policy relocation compensation received
by the Company and will be amortized according to the depreciation of new-built assets amount of
20764119.52 Yuan amortizes in the year.
(10) Fund of industry upgrade (2016): In accordance with the document Xi Xin Guan Jing Fa [2016] No.585 and
Xi Xin Fa [2016] No.70 the Company received funds of 40 million Yuan appropriated for industry upgrading in
2016.
(11) Guilding capital for the technical reform from State Hi-Tech Technical Commission: In accordance with the
document Xi Jing Xin ZH [2016] No.9 and Xi Cai GM [2016] No.56 the Company received a 9.74 million Yuan
for the guiding capital of technical reform (1st batch) from Wuxi for year of 2016 and belongs to government
grant with assets concerned and shall be amortized according to the depreciation process amount of 1552110.44
Yuan amortize in the year.
(12) Implementation of the variable cross-section turbocharger for diesel engine: In accordance with the document
YCZ Fa[2016] NO.623 and “Strong Industrial Base Project Contract for year of 2016” subsidiary Weifu Tianli
received a specific subsidy of 16.97 million Yuan (760000 Yuan received in the period) the fund supporting
strong industrial base project (made-in-China 2025) of central industrial transformation and upgrading 2016 from
Ministry of Industry and Information Technology; and belongs to government grant with assets concerned and
shall be amortized according to the depreciation process amount of 1609982.67 Yuan amortize in the year.
(13) Demonstration project for intelligent manufacturing: under the Notice Relating to Selection of the Intelligent
Manufacturing Model Project in Huishan District in 2016 (HJXF[2016]No.36) a fiscal subsidy of 3000000 Yuan
was granted by relevant government authority in Huishan district to our subsidiary Weifu Leader in 2017 to be
utilized for transformation and upgrade of Weifu Leader’s intelligent manufacturing facilities. This subsidy
belongs to government grant related to assets which shall be amortized based on the depreciation progress of the
assets. Amortization for the year amounts to 299341.74 Yuan.
(14) The 2
nd
batch of provincial special funds for industry transformation of industrial and information in 2019:
according to XCGM [2019] No. 121 the Company received a special fund of 5 million Yuan in 2020 this subsidy
was related to the"Weifu High-Technology New Factory Internet Construction" projects and belonged to
government subsidies related to assets.
(15) Municipal technological reform fund allocation in 2020: according to XGXZH [2020] No. 16 the Company
received 4.77 million Yuan of municipal technological transformation fund project allocation in 2020 which was
related to key technological transformation projects and belonged to government subsidies related to assets.(16) Strategic cooperation agreement funding for key enterprise of smart manufacturing in high-tech zone:
according to XXGXF [2020] No. 61 the Company received a related grant of 4.06 million Yuan in 2020 this
subsidy was related to the intelligent transformation project and belonged to the government subsidies related to
assets.
35. Share capital
In RMB
Opening balance
Change during the year (+ -)
Ending balance New shares
issued
Bonus share
Shares
transferred
from capital
reserve
Other Subtotal
Total shares 1008950570.00 1008950570.00
36. Capital reserve
In RMB/CNY
Item Opening balance Current increased Current decreased Ending balance
Capital premium (Share
capital premium)
3346333817.41 103565899.63 3242767917.78
Other Capital reserve 45193988.92 6280461.58 51474450.50
Total 3391527806.33 6280461.58 103565899.63 3294242368.28
Other explanation including changes in the period and reasons for changes;
(1)Share capital premium has 103565899.63 Yuan declined in the Period mainly due to the following:
①the difference between the long-term equity investment newly acquired by the company to purchase minority of
IRD and the net assets that the company should enjoy continuously calculated from the date of purchase based on
the newly increased shareholding ratio is 7176697.04 Yuan;
② the difference between the repurchase cost of 398868402.59 Yuan(19540000 shares repurchased for use in
the restricted share incentive plan) and the amount of subscription money 302479200.00 Yuan is 96389202.59
Yuan.
(2) Other Capital reserve increase 6280461.58 Yuan in the period mainly resulted by the share payment settled
by equity 6484837.50 Yuan deducted 204375.92 Yuan attributable to minority’s shareholder.
37. Treasury stock
In RMB/CNY
Item Opening balance Current increased Current decreased Ending balance
Stock repurchases 400017180.33 398868402.59 1148777.74
Repurchase obligation of 302479200.00 302479200.00
restricted stock incentive plan
Total 702496380.33 398868402.59 303627977.74
Other explanations including changes in the current period and explanations of the reasons for the changes:
(1) Stock repurchase: increased 400017180.33 Yuan in the Period mainly refers to the repurchase of
19596277.00 shares by way of centralized competitive bidding for the implementation of restricted stock
incentive plan; decreased 398868402.59 Yuan in the Period mainly refers to the 19540000.00 shares awarded
to incentive object for the implementation of restricted stock incentive plan.
(2)Repurchase obligation of restricted stock incentive plan: increased 302479200.00 Yuan in the Period mainly
refers to the repurchase obligation recognized in accordance with the subscription paid by the incentive object for
the implementation of restricted stock incentive plan.
38. Other comprehensive income
In RMB/CNY
Item
Opening
balance
Current period
Ending
balance
Account before
income tax in
the year
Less: written
in other
comprehensi
ve income in
previous
period and
carried
forward to
gains and
losses in
current
period
Less:
written in
other
comprehe
nsive
income in
previous
period and
carried
forward to
retained
earnings in
current
period
Less:
incom
e tax
expens
e
Belong to
parent
company after
tax
Belong to
minority
shareholder
s after tax
II. Other comprehensive
income items which will be
reclassified subsequently to
profit or loss
134871.67 13839596.07
13781747.
80
57848.27 13916619.47
Conversion difference of
foreign currency financial
statement
134871.67 13839596.07
13781747.
80
57848.27 13916619.47
Total other comprehensive
income
134871.67 13839596.07
13781747.
80
57848.27 13916619.47
Other explanation including the adjustment on initial recognition for arbitrage items that transfer from the effective part of cash flow
hedge profit/loss:
Nil
39. Reasonable reserve
In RMB/CNY
Item Opening balance Current increased Current decreased Ending balance
Safety production costs 3247757.06 21673368.09 22587635.12 2333490.03
Total 3247757.06 21673368.09 22587635.12 2333490.03
Other explanation including changes and reasons for changes:
(1) Instructions for the withdrawing of special reserves (safe production cost): According to the CQ [2012] No. 16 -
Administrative Measures on the Withdrawing and Use of Enterprise Safety Production Expenses jointly issued by
the Ministry of Finance and the State Administration of Work Safety in the current period the Company adopted
excess retreat method for quarterly withdrawal by taking the actual operating income of the previous period as the
withdrawing basis.
(2) Among the above safety production costs including the safety production costs accrual by the Company in
line with regulations and the parts enjoy by shareholders of the Company in safety production costs accrual by
subsidiary in line with regulations.
40. Surplus reserve
In RMB/CNY
Item Opening balance Current increased Current decreased Ending balance
Statutory surplus reserves 510100496.00 510100496.00
Total 510100496.00 510100496.00
Other explanation including changes and reasons for changes:
Withdrawal of the statutory surplus reserves: Pursuit to the Company Law and Article of Association the
Company extracted statutory surplus reserve on 10 percent of the net profit. No more amounts shall be withdrawal
if the accumulated statutory surplus reserve takes over 50 percent of the registered capital.
41. Retained profit
In RMB/CNY
Item Current period Last period
Retained profits at the end of last year before adjustment 12076443635.56 10996945870.13
Total retained profit at beginning of the adjustment (+ for increased -for
decreased)
1584556.37
Retained profits at the beginning of the year after adjustment 12076443635.56 10998530426.50
Add: The net profits belong to owners of patent company of this period 2772769377.96 2268026432.78
Less: Common dividend payable 1093241270.00 1210740684.00
Withdraw employee rewards and welfare funds 2525946.49
Add: Net effect of disposal other equity instrument investment 2656627.59 20627460.28
Retained profit at period-end 13756102424.62 12076443635.56
Details about adjusting the retained profits at the beginning of the period:
1) The retroactive adjustments to Accounting Standards for Business Enterprises and its relevant new regulations
affect the retained profits at the beginning of the period amounting to 0 Yuan.
2) The changes in accounting policies affect the retained profits at the beginning of the period amounting to
1584556.37 Yuan.
3) The major accounting error correction affects the retained profits at the beginning of the period amounting to 0
Yuan
4) Merge scope changes caused by the same control affect the retained profits at the beginning of the period
amounting to 0 Yuan.
5) Other adjustments affect the retained profits at the beginning of the period amounting to 0 Yuan
42. Operating income and cost
In RMB/CNY
Item
Current period Last Period
Income Cost Income Cost
Main operating 12430431489.90 10124574480.95 8354743964.67 6322810707.67
Other business 453394816.70 304709961.02 429612995.63 347543672.87
Total 12883826306.60 10429284441.97 8784356960.30 6670354380.54
Whether the lower of the audited net profit before and after deduction of non-recurring gains and losses is negative
□Yes √No
43. Operating tax and extras
In RMB/CNY
Item Current period Last Period
City maintaining & construction tax 22768800.74 24124239.92
Educational surtax 16259673.98 17320175.67
Property tax 16993056.48 16236869.24
Land use tax 4516628.41 5991933.84
Vehicle use tax 29923.52 31410.44
Stamp duty 4508905.03 2720462.05
Other taxes 246793.71 209545.50
Total 65323781.87 66634636.66
44. Sales expenses
In RMB/CNY
Item Current period Last Period
Salary and fringe benefit 58727035.03 53193376.14
Consumption of office materials and business travel charge 9260423.14 12114381.29
Transportation charge 36110291.16
Warehouse charge 24982242.41 13540499.34
Three guarantees and quality cost 272364223.21 102034286.75
Business entertainment fee 25842735.05 26297874.14
Other 15176786.26 16360043.51
Total 406353445.10 259650752.33
45. Administration expenses
In RMB/CNY
Item Current period Last Period
Salary and fringe benefit 295394722.09 261541676.32
Depreciation charger and long-term assets amortization 65638800.42 55145177.10
Consumption of office materials and business travel charge 16772265.23 19603194.54
Incentive fund 187658444.76 71880000.00
Share-based payment 3878656.31
Other 213481533.82 105858403.80
Total 782824422.63 514028451.76
46. R&D expenses
In RMB/CNY
Item Current period Last Period
Technological development expenses 532581209.78 417924908.28
Total 532581209.78 417924908.28
47. Financial expenses
In RMB/CNY
Item Current period Last Period
Interest expenses 11466886.33 21770516.39
Note discount interest expenses 8075178.10 1205789.22
Less: interest income 51622216.58 79299239.77
Gains/losses from exchange 5138503.01 -5453798.20
Handling charges 3663347.30 3884456.24
Total -23278301.84 -57892276.12
48. Other income
In RMB/CNY
Sources of income generated Current period Last Period
Government grants with routine operation activity concerned 80342497.11 91170663.57
Total 80342497.11 91170663.57
49. Investment income
In RMB/CNY
Item Current period Last Period
Income of long-term equity investment calculated based on equity 1659752704.14 1378264061.18
Investment income from holding financial assets available for sales 683211.60 1383668.59
Dividend income from holding other equity instrument investment 900000.00
Investment income of financial products 263460954.90 236832172.54
Other 40908817.93 -2839187.48
Total 1964805688.57 1614540714.83
50. Income from change of fair value
In RMB/CNY
Sources Current period Last Period
Changes in the fair value of wealth management products 8223219.19 18231842.32
Changes in the fair value of the stocks of listed companies
held-excluding the stocks of listed companies that are included in
other equity instrument investments
375102546.00 6787824.00
Total 383325765.19 25019666.32
51. Credit impairment loss
In RMB/CNY
Item Current period Last Period
Bad debt loss -11184647.60 -52825875.25
Total -11184647.60 -52825875.25
52. Assets impairment loss
In RMB/CNY
Item Current period Last Period
I. Loss of bad debts 0.00 0.00
II. Loss of inventory falling price and loss of contract
performance cost impairment
-142400798.47 -169460299.73
III. Long-term equity investment impairment losses 0.00 0.00
IV. Impairment loss of investment real estate 0.00 0.00
V. Impairment loss of fixed assets -36436674.38 0.00
VI. Devaluation loss of construction materials 0.00 0.00
VII. Impairment loss of construction in progress 0.00 0.00
VIII. Impairment loss of productive biological assets 0.00 0.00
IX. Impairment losses of oil and gas assets 0.00 0.00
X. Intangible assets impairment loss 0.00 0.00
XI. Goodwill impairment loss 0.00 0.00
XII. Impairment loss of contract assets 0.00 0.00
XIII. Other 0.00 0.00
Total -178837472.85 -169460299.73
53. Income from assets disposal
In RMB/CNY
Sources Current period Last Period
Income from disposal of non-current assets 12962146.98 34050815.11
Losses from disposal of non-current assets -1507738.38 -1896354.90
Total 11454408.60 32154460.21
54. Non-operating income
In RMB/CNY
Item Current period Last Period
Amount reckoned into current
non-recurring gains/losses
Periodic reduction or exemption of part of social insurance
premiums
60373772.69 60373772.69
Periodic reduction of kinetic energy costs 5759525.46 5759525.46
Other 333723.47 2413561.54 333723.47
Total 66467021.62 2413561.54 66467021.62
Government subsidies included in the current profit and loss:
Nil
55. Non-operating expense
In RMB/CNY
Item Current period Last Period
Amount reckoned into current
non-recurring gains/losses
Donation 3107003.70 73332.31 3107003.70
Non-current assets disposal losses 738248.83 3161855.50 738248.83
Including: loss of fixed assets scrap 738248.83 3161855.50 738248.83
Local fund 2734286.52
Other 313635.64 156952.84 313635.64
Total 4158888.17 6126427.17 4158888.17
56. Income tax expense
(1) Income tax expense
In RMB/CNY
Item Current period Last Period
Payable tax in current period 170925337.68 147179544.24
Adjusted the previous income tax -2349322.00 5674478.65
Increase/decrease of deferred income tax assets -54432577.63 -12918338.05
Increase/decrease of deferred income tax liability 66072310.95 7870125.22
Total 180215749.00 147805810.06
(2) Adjustment on accounting profit and income tax expenses
In RMB/CNY
Item Current period
Total profit 3002951679.56
Income tax measured by statutory/applicable tax rate 450442751.93
Impact by different tax rate applied by subsidies 4347476.78
Adjusted the previous income tax -2349322.00
Impact by non-taxable revenue -248721266.24
Impact on cost expenses and losses that unable to deducted 37323520.03
Impact by the deductible losses of the un-recognized previous deferred income tax -34045025.55
The deductible temporary differences or deductible losses of the un-recognized
deferred income tax assets in the Period
11968364.43
Impact on additional deduction -41288278.77
Other 2537528.39
Income tax expense 180215749.00
57. Other comprehensive income
See Note VII. 38 “Other comprehensive income”
58. Items of ash flow statement
(1) Other cash received in relation to operation activities
In RMB/CNY
Item Current period Last Period
Interest income 52277269.56 77690762.13
Government grants 41044012.67 30510895.39
Margin on operation bill 27804815.03
Other 9252536.29 7906425.25
Total 102573818.52 143912897.80
(2) Other cash paid in relation to operation activities
In RMB/CNY
Item Current period Last Period
Cash cost 840363837.09 525923320.71
Other 59565319.82 22629265.34
Total 899929156.91 548552586.05
(3) Cash received from other investment activities
In RMB/CNY
Item Current period Last Period
Received the disposal payment 10654092.89
Received investment funds in transit at the end of 2019 30448157.81
Import equipment letter of credit guarantee 1450000.00
Cash from Weifu Electronic Drive merger not under the same
control
67622008.17
Intercourse funds of unit 24000000.00
Other 953424.66
Total 65102250.70 70025432.83
(4) Cash paid related with investment activities
In RMB/CNY
Item Current period Last Period
Margin paid by L/C for purchase of equipment 587241.00
Trading losses on forward foreign exchange and RMB options 1115357.50
Intercourse funds of unit 13992067.94 24000000.00
Total 14579308.94 25115357.50
(5) Other cash received in relation to financing activities
In RMB/CNY
Item Current period Last Period
Borrowings received by Weifu Leader 5470000.00
Borrowings received by IRD 260135.13 845291.11
Total 5730135.13 845291.11
(6) Cash paid related with financing activities
In RMB/CNY
Item Current period Last Period
Account paid for purchasing minority equity of Weifu Tianli 132522000.00
Account paid for purchasing minority equity of IRD 48507056.85
National debt paid transfer to loans 351298.00 339091.00
Borrowing return by Weifu Leader 5470000.00
Borrowing return by IRD 7733845.00
Payments from finance leases 375886.28
Repurchase of A shares 400017180.33
Total 449251421.46 146064936.00
59. Supplementary information to statement of cash flow
(1) Supplementary information to statement of cash flow
In RMB/CNY
Supplementary information Current period Last Period
1. Net profit adjusted to cash flow of operation activities: -- --
Net profit 2822735930.56 2302736761.11
Add: Assets impairment provision 190022120.45 222286174.98
Depreciation of fixed assets consumption of oil assets and
depreciation of productive biology assets
390748987.16 315650455.35
Depreciation of right-of-use assets
Amortization of intangible assets 37146026.79 24276364.81
Amortization of long-term deferred expenses 12637958.88 6293470.69
Loss from disposal of fixed assets intangible assets and other
long-term assets (gain is listed with “-”)
-11454408.60 -32154460.21
Losses on scrapping of fixed assets (gain is listed with “-”) 738248.83 3161855.50
Gain/loss of fair value changes (gain is listed with “-”) -383325765.19 -25019666.32
Financial expenses (gain is listed with “-”) 17798991.04 15026154.36
Investment loss (gain is listed with “-”) -1957024490.66 -1613945471.30
Decrease of deferred income tax asset ((increase is listed with “-”) -54432577.63 -12918338.05
Increase of deferred income tax liability (decrease is listed with “-”) 66072310.95 7870125.22
Decrease of inventory (increase is listed with “-”) -591321045.44 -1130561363.05
Decrease of operating receivable accounts (increase is listed with “-”) -1326286166.68 -1110387668.48
Increase of operating payable accounts (decrease is listed with “-”) 1562204812.18 2074881909.55
Other 5550301.37 1473749.07
Net cash flows arising from operating activities 781811234.01 1048670053.23
2. Material investment and financing not involved in cash flow -- --
Conversion of debt into capital
Switching Company bonds due within one year
financing lease of fixed assets
3. Net change of cash and cash equivalents: -- --
Balance of cash at period end 944946018.70 820498653.85
Less: Balance of cash equivalent at year-begin 820498653.85 2404674139.49
Add: Balance at year-end of cash equivalents
Less: Balance at year-begin of cash equivalents
Net increase of cash and cash equivalents 124447364.85 -1584175485.64
(2) Net cash payment for the acquisition of a subsidiary in the period
In RMB/CNY
Amount
Cash and cash equivalent paid in the period for enterprise combination occurred in the period 318708001.47
Including: --
Less: Cash and cash equivalent held by subsidiary on purchasing date 21405243.16
Including: --
Including: --
Net cash paid for subsidiary obtained 297302758.31
Other explanation: Nil
(3) Net cash received from the disposal of subsidiaries
Nil
(4) Constitution of cash and cash equivalent
In RMB/CNY
Item Ending balance Opening balance
I. Cash 944946018.70 820498653.85
Including: Cash on hand 507.66 93165.33
Bank deposit available for payment at any time 944945511.04 820405488.52
III. Balance of cash and cash equivalents at the period-end 944946018.70 820498653.85
Other explanation: Nil
The difference between bank deposits available for payment at any time and the bank deposits in Note VII. 1 "Monetary Funds" is the
company's fixed deposits in the bank.
60. Note of the changes of owners’ equity
Explain the items and amount at period-end adjusted for “Other” at end of the last year: Nil
61. Assets with ownership or use right restricted
In RMB/CNY
Item Ending Book value Restriction reason
Monetary funds 587241.00 Letter of Credit Margin
Note receivable 881914376.95 Notes pledge for bank acceptance
Monetary funds 51045344.11 Cash deposit paid for bank acceptance
Monetary funds 2838880.93 Court freeze
Monetary funds 215720.00 Mastercard deposit
Receivables
financing
646892501.28 Notes pledge for bank acceptance
Transaction
financial asset
174611992.62
In accordance with the civil ruling No.(2016)Y03MC2490 and No.(2016)
Y03MC2492 of Guangdong Shenzhen Intermediate People's Court (Hereinafter
referred to as Shenzhen Intermediate People's Court) the property with the value of
217 million Yuan under the name of the Company and other seven respondents and
the third party Shenzhen Hejun Chuangye Holdings Co. Ltd. (Hereinafter referred to
as Hejun Company) was frozen. As of the end of the reporting period 4.71 million
shares of Miracle Automation and 11739102 shares of SDEC held by the Company
were frozen.Total 1758106056.89 --
62. Item of foreign currency
(1) Item of foreign currency
In RMB/CNY
Item Closing balance of foreign currency Rate of conversion Ending RMB balance converted
Monetary funds -- --
Including: USD 11596564.24 6.5249 75666419.10
EUR 3694505.41 8.025 29648405.15
HKD 11548347.98 0.84164 9719551.59
DKK 9616906.23 1.0786 10372795.06
Account receivable -- --
Including: USD 2190411.21 6.5249 14292214.10
EUR 1290945.42 8.025 10359837.00
HKD
JPY 12179808.00 0.063236 770202.34
DKK 2239065.57 1.0786 2415056.12
Long-term borrowings -- --
Including: USD
EUR
HKD
Other account receivables -- --
Including: EUR 70143.68 8.025 562903.03
DKK 462081.08 1.0786 498400.65
Short-term borrowings -- --
Including: EUR 4981278.48 8.025 39974759.80
Account payable -- --
Including: USD 812035.19 6.5249 5298448.41
EUR 1031866.82 8.025 8280731.24
JPY 15780699.00 0.063236 997908.28
CHF 103580.75 7.4006 766559.70
DKK 2865734.26 1.0786 3090980.97
GBP 59450.00 8.8903 528528.34
Other account payable -- --
Including: EUR 255.00 8.025 2046.38
DKK 402113.23 1.0786 433719.33
(2) Explanation on foreign operational entity including as for the major foreign operational entity
disclosed main operation place book-keeping currency and basis for selection; if the book-keeping
currency changed explain reasons
√ Applicable □ Not applicable
Subsidiary of the Company IRD was established in Denmark in 1996. The 66% equity of IRD were required by
the Company in cash in April 2019 and in October 2020 increasing the shareholding to 34.00% by cash purchase.
After the increase in holdings the company acquired 100.00% of the company's equity. Book-keeping currency of
IRD was Danish krone and IRD mainly engaged in the R&D production and sales of fuel cell components.
Subsidiary Borit was established in Belgium in 2010. the Company acquired 100% equity of Borit by cash
acquisition in November 2020. Borit is denominated in Euro and engaged in the R&D production and sales of
fuel cell components.
63. Government grants
(1) Government grants
In RMB/CNY
Category Amount Item
Amount
reckoned in
current gain/loss
The second batch of provincial-level industrial and information
industry transformation special funds in 2019
5000000.00 Deferred income
Municipal technological reform fund allocation in 2020
Appropriations for Municipal Technical Reform Fund Projects in
2020
4770000.00 Deferred income
Strategic cooperation agreement funding for key enterprise of smart
manufacturing in high-tech zone
Strategic cooperation agreement funds for key intelligent
manufacturing enterprises in the high-tech zone
4060000.00 Deferred income
2020 Wuxi Science and Technology Development Fund 19th Batch
of Science and Technology Development Plan Project Funds
1000000.00 Deferred income
Intelligent transformation of Automobile components
manufacturing process
1310000.00 Deferred income
E-store 1162700.27
Deferred income
other income
1162700.27
Anione 1410199.51
Deferred income
other income
211192.07
Annual output of 150000 gasoline engine turbochargers 1095300.00
Deferred income
other income
717082.83
Neptune 918551.27 Deferred income
Development of variable nozzle turbocharger meeting the
requirements of National VI B
800000.00 Deferred income
Pegasus 528530.85
Deferred income
other income
528530.85
HighPem2 Gas 356327.63
Deferred income
other income
356327.63
Job stabilization subsidy 4125376.68 Other income 4125376.68
Intelligent transformation and technical transformation guidance
funds
3740000.00 Other income 3740000.00
Wuxi City Intellectual Property Project Operation Service System
Construction Fund
1050000.00 Other income 1050000.00
"Work for training" subsidy 1269900.00 Other income 1269900.00
Training subsidy 1005934.35 Other income 926294.35
2019 Wuxi Mayor Quality Award 1000000.00 Other income 1000000.00
Distributed photovoltaic project power generation subsidies 968800.00 Other income 968800.00
Service charge for three agencies 682632.28 Other income 682632.28
The second batch of supporting project funds (manufacturing
taxation top 30)
350000.00 Other income 350000.00
2019 Quality Special Award 350000.00 Other income 350000.00
Huishan District Support Fund 340000.00 Other income 340000.00
Special subsidies for enterprise vocational education in Binhu
District in the third quarter of 2019
324300.00 Other income 324300.00
Vocational Appraisal Guidance Center Collection 303600.00 Other income 303600.00
Technology plan subsidy 300000.00 Other income 300000.00
2020 Wuxi Smart Manufacturing Project Support Fund 300000.00 Other income 300000.00
Subsidies for manufacturing individual champion enterprises 200000.00 Other income 200000.00
Intellectual property reward 114670.00 Other income 114670.00
In 2019 the integration of industrialization and industrialization
and the provincial-level segmentation project reward for enterprise
cloud
180000.00 Other income 180000.00
2019 Huishan District "Pioneer Talent Program" Talent Award 150000.00 Other income 150000.00
2019 corporate postdoctoral subsidy funds 120000.00 Other income 120000.00
2019 tax contribution incentives for key enterprises 100000.00 Other income 100000.00
Supporting funding for key talent programs above the provincial
level
100000.00 Other income 100000.00
Other 1557189.83
Deferred income
other income
998816.62
Total 41044012.67
(2) Government grants rebate
□ Applicable√ Not applicable
Other explanation:
64. Other
Nil
VIII. Changes of consolidation scope
1. Enterprise combine not under the same control
(1) Enterprise combines not under the same control occurred in the period
In RMB/CNY
Purchaser
Time point for
equity obtained
Cost of equity
obtained
Ratio of
equity
obtained
Acquir
ed
way
Equity
obtain
ed
way
Purchasing date
Standard
to
determin
e the
purchasi
ng date
Income of
purchaser from
purchasing date
to period-end
Net profit of
purchaser from
purchasing date
to period-end
Borit
November 30
2020
318708001.47 100.00%
Cash
purcha
se
November 30 2020 100% 9143241.73 -5166510.61
Other explanation:
(2) Combination cost and goodwill
In RMB/CNY
Combination cost Borit
--Cash 318708001.47
Total combination cost 318708001.47
Less: shares of fair value of identifiable net assets acquired 70941353.26
Goodwill/merger cost is less than the shares of fair value of identifiable net assets acquired 247766648.21
The main reasons for the formation of large amounts of goodwill:
In this period the company acquired 100.00% equity of Borit in the form of cash purchase the goodwill was the
part that the cost of the merger was greater than the fair value share of the identifiable net assets of
Borit.According to the “Assets Appraisal Report” (Wanlong PBZi (2021) No. 40016) issued by Wanlong
(Shanghai) Assets Appraisal Co. Ltd appointed by the Company the recoverable value of the assets group where
the goodwill of the merged with Borit is 439880000 Yuan higher than the carrying value of 339170000 Yuan
and there is no impairment loss of goodwill.
(3) Identifiable assets and liability on purchasing date under the purchaser
In RMB/CNY
Borit
Fair value on purchasing date Book value on purchasing date
Monetary funds 21405243.16 21405243.16
Account receivable 2306622.48 2306622.48
Inventory 12692549.70 11925135.80
Fixed assets 46007739.12 28314172.77
Intangible assets 39460780.10 13349057.73
Account paid in advance 478370.09 478370.09
Other account receivables 748859.12 748859.12
Construction in progress 950331.98 950331.98
Deferred tax assets 1388436.59 1388436.59
Accounts payable 7894432.49 7894432.49
Deferred income tax liabilities 11143175.66
Contract liabilities 3067697.93 3067697.93
Employee compensation payable 2805072.70 2805072.70
Taxes payable 273570.08 273570.08
Other payable 13935900.17 13935900.17
Non-current liabilities due within one year 872471.02 872471.02
Long term loan 6201616.25 6201616.25
Long-term payable 7106533.43 7106533.43
Deferred income 1197109.35 1197109.35
Net assets 70941353.26 37511826.30
Net assets acquired 70941353.26 37511826.30
Other explanation: Nil
(4) Gains or losses arising from re-measured by fair value for the equity held before purchasing date
Whether it is a business combination realized by two or more transactions of exchange and a transaction of obtained control rights in
the Period or not
□ Yes √ No
(5)Notes relating to the purchase date or the end of the period in which the merger consideration or the fair
value of the purchasee’s identifiable assets and liabilities cannot be reasonable determined
Nil
(6)Other explanations
Nil
2. Enterprise combine under the same control
Nil
3. Reverse purchase
Nil
4. Disposal of subsidiaries
Whether there is a single disposal of an investment in a subsidiary that resulted in a loss of control
□ Yes √ No
Whether there is a step-by-step disposal of investment in a subsidiary through multiple transactions and loss of control during the
period
□ Yes √ No
5. Other reasons for consolidation range changed
Explain the reasons on consolidate scope changes (i.e. subsidiary newly established subsidiary liquidation etc.)
and relevant information:
In the reporting period Weifu Leader- subsidiary of the company established the Autosmart Seating jointly with
Qiqiong Automobile Technology (Shanghai) Co. Ltd. According to the Article of Association under the name of
Autosmart Seating Weifu Leader holds 66.00% equity of Autosmart Seating while 34.00% held by Qiqiong
Automobile Technology (Shanghai) Co. Ltd.
6. Other
Nil
IX. Equity in other entity
1. Equity in subsidiary
(1) Constitute of enterprise group
Subsidiary
Main
operation
place
Registered
place
Business nature
Share-holding ratio
Acquired way
Directly Indirectly
Weifu Jinning Nanjing Nanjing
Spare parts of
internal-combustion engine
80.00%
Enterprise combines
under the same control
Weifu Leader Wuxi Wuxi
Automobile exhaust purifier
muffler
94.81%
Enterprise combines
under the same control
Weifu Mashan Wuxi Wuxi
Spare parts of
internal-combustion engine
100.00% Investment
Weifu Chang’an Wuxi Wuxi
Spare parts of
internal-combustion engine
100.00% Investment
Weifu
International
Trade
Wuxi Wuxi Trading 100.00%
Enterprise combines
under the same control
Weifu Schmidt Wuxi Wuxi Spare parts of 66.00% Investment
internal-combustion engine
Weifu Tianli Ningbo Ningbo
Spare parts of
internal-combustion engine
98.83% 1.17%
Enterprise combines not
under the same control
Weifu Autocam Wuxi Wuxi
Spare parts of
internal-combustion engine
51.00%
Enterprise combines not
under the same control
Weifu Leader
(Wuhan)
Wuhan Wuhan
Automobile exhaust purifier
muffler
60.00% Investment
Weifu Leader
(Chongqing)
Chongqing Chongqing
Automobile exhaust purifier
muffler
100.00% Investment
Weifu Leader
(Nanchang)
Nanchang Nanchang
Automobile exhaust purifier
muffler
100.00% Investment
Autosmart
Seating
Wuxi Wuxi Smart car equipment 66.00% Investment
Weifu Electric
Drive
Wuxi Wuxi Hub Motor 80.00%
Enterprise combines not
under the same control
SPV Denmark Denmark Investment 100.00% Investment
IRD Denmark Denmark Fuel cell components 100.00%
Enterprise combines not
under the same control
IRD America America America Fuel cell components 100.00%
Enterprise combines not
under the same control
Borit Belgium Belgium Fuel cell components 100.00%
Enterprise combines not
under the same control
Borit Inc. America America Fuel cell components 100.00%
Enterprise combines not
under the same control
Explanation on share-holding ratio in subsidiary different from ratio of voting right:
Nil
Basis for holding half or less of the voting rights but still controlling the investee and holding more than half of the voting rights but
not controlling the investee:
Nil
(2) Important non-wholly-owned subsidiary
In RMB/CNY
Subsidiary
Share-holding ratio of
minority
Gains/losses attributable
to minority in the Period
Dividend announced to
distribute for minority in
the Period
Ending equity of
minority
Weifu Jinning 20.00% 21848100.90 15748768.80 199246408.99
Weifu Schmidt 34.00% 4996898.99 16239171.33
Weifu Leader 5.19% 11252872.88 107011846.40
Weifu Autocam 49.00% 22118036.30 177267298.23
Total 60215909.07 15748768.80 499764724.95
Explanation on holding ratio different from the voting right ratio for minority shareholders:
Nil
(3) Main finance of the important non-wholly-owned subsidiary
In RMB/CNY
Subsidiary
Ending balance
Current assets Non-current assets Total assets Current liabilities
Non-current
liabilities
Total liabilities
Weifu Jinning 1182876680.02 293436809.97 1476313489.99 433667329.34 42293914.58 475961243.92
Weifu Schmidt 213435154.59 47533838.59 260968993.18 212812487.33 212812487.33
Weifu Leader 4942039786.72 1200764541.57 6142804328.29 4204615377.36 20388995.29 4225004372.65
Weifu Autocam 323378083.30 360083668.37 683461751.67 321531075.82 321531075.82
Total 6661729704.63 1901818858.50 8563548563.13 5172626269.85 62682909.87 5235309179.72
In RMB/CNY
Subsidiary
Opening balance
Current assets Non-current assets Total assets Current liabilities
Non-current
liabilities
Total liabilities
Weifu Jinning 999097495.08 334721775.17 1333819270.25 318915621.86 47104930.82 366020552.68
Weifu
Schmidt
141991506.20 49208881.93 191200388.13 157822785.29 157822785.29
Weifu Leader 3941739116.15 1095110196.65 5036849312.80 3351853614.37 22204377.06 3374057991.43
Weifu
Autocam
245057798.53 323114477.06 568172275.59 254234583.00 254234583.00
Total 5327885915.96 1802155330.81 7130041246.77 4082826604.52 69309307.88 4152135912.40
In RMB/CNY
Subsidiary
Current period
Operation Income Net profit
Total comprehensive
income
Cash flow from operation
activity
Weifu Jinning 685608389.43 110875256.44 110875256.44 42395588.51
Weifu Schmidt 252434907.65 14694274.89 14694274.89 -2270586.10
Weifu Leader 6427844701.00 245276849.88 245276849.88 41415937.03
Weifu Autocam 485081038.09 50518929.75 50518929.75 86836060.40
Total 7850969036.17 421365310.96 421365310.96 168376999.84
In RMB/CNY
Subsidiary
Last Period
Operation Income Net profit
Total comprehensive
income
Cash flow from operation
activity
Weifu Jinning 591679134.25 124990228.55 124990228.55 73403344.49
Weifu Schmidt 221352114.68 5093231.61 5093231.61 19622886.37
Weifu Leader 3020424650.65 33406696.55 33406696.55 112342744.56
Weifu Autocam 417638897.85 23573670.87 23573670.87 125547456.63
Total 4251094797.43 187063827.58 187063827.58 330916432.05
(4) Significant restrictions on the use of enterprise group assets and pay off debts of the enterprise group
Nil
(5) Financial or other supporting offers to the structured entity included in consolidated financial statement
range
Nil
2. Transaction that has owners’ equity shares changed in subsidiary but still with controlling rights
(1) Owners’ equity shares changed in subsidiary
In October 2020 the company purchased the equity held by minority shareholders of IRD with 48507056.85
Yuan in cash. After this transaction the company's shareholding in IRD was changed from 66.00% to 100.00%.
(2) Impact on minority’s interest and owners’ equity attributable to parent company
In RMB/CNY
--Cash 48507056.85
Less: Net assets share of the subsidiary calculated according to the equity ratio obtained/disposed 41330359.81
Balance 7176697.04
Including: Capital reserve adjustment 7176697.04
3. Equity in joint venture and associated enterprise
(1) Important joint venture and associated enterprise
Joint venture or associated
enterprise
Main
operation
place
Registered
place
Business nature
Share-holding ratio Accounting
treatment on
investment for
joint venture and
associated
enterprise
Directly Indirectly
Wuxi Weifu Environment
Catalyst Co. Ltd.
Wuxi Wuxi Catalyst 49.00% Equity method
Bosch Automobile Diesel
System Co. Ltd.Wuxi Wuxi
Internal-combustion
engine accessories
32.50% 1.50% Equity method
Zhonglian Automobile
Electronic Co. Ltd.
Shanghai Shanghai
Internal-combustion
engine accessories
20.00% Equity method
Weifu Precision Machinery
Manufacturing Co. Ltd.Wuxi Wuxi
Internal-combustion
engine accessories
20.00% Equity method
Shinwell Automobile
Technology (Wuxi) Co. Ltd.Wuxi Wuxi Automobile components 45.00% Equity method
Changchun Xuyang Weifu
Automobile components
Technology Co. Ltd.
Changchun Changchun Automobile components 34.00% Equity method
Holding shares ratio different from the voting right ratio:
Has major influence with less 20% voting rights hold or has minor influence with over 20% (20% included) voting rights hold:
(2) Main financial information of the important joint venture
Nil
(3) Main financial information of the important associated enterprise
In RMB/CNY
Ending balance/Current period Opening balance/Last Period
Weifu
Environment
Bosch Diesel
System
Zhonglian
Automobile
Weifu
Environment
Bosch Diesel
System
Zhonglian
Automobile
Current assets 4446438334.10 11965249225.12 201344601.39 3285078665.28 10878760988.82 175292101.34
Non -current
assets
363513166.84 2995027302.84 5985689857.38 323188749.54 3059116036.23 6129564645.28
Total assets 4809951500.94 14960276527.96 6187034458.77 3608267414.82 13937877025.05 6304856746.62
Current 3251776146.44 7423648562.76 3687897.36 2401381614.27 4613514567.69 3030820.85
liabilities
Non-current
liabilities
175895402.90 2638609.61 26545326.53 2699079.03
Total liabilities 3427671549.34 7423648562.76 6326506.97 2427926940.80 4613514567.69 5729899.88
Attributable to
parent company
shareholders’
equity
1382279951.60 7536627965.20 6180707951.80 1180340474.02 9324362457.36 6299126846.74
Share of net
assets calculated
by shareholding
ratio
677317176.28 2562453508.17 1236141590.36 578366832.27 3170283235.50 1259825369.35
--Goodwill 267788761.35 1407265.96 267788761.35 1407265.96
--Unrealized
profit of internal
trading
-29652559.84 -20979859.92
--Other -0.28 -0.01 -0.28
Book value of
equity
investment in
associated
enterprise
677317176.28 2800589709.40 1237548856.31 578366832.27 3417092136.65 1261232635.31
Operation
income
7458886474.12 15742669081.61 23790158.00 3729583492.29 14224084504.12 23049985.98
Net profit 296484991.05 3511327740.19 1538581105.06 26414017.30 3152063841.44 1399783397.92
Total
comprehensive
income
296484991.05 3511327740.19 1538581105.06 26414017.30 3152063841.44 1399783397.92
Dividends
received from
associated
enterprise in the
year
1801681159.00 331400000.00 858896776.94 105200000.00
Other explanation
Adjustment item for other “-0.28”: the differential tail;
(4) Financial summary for non-important Joint venture and associated enterprise
In RMB/CNY
Ending balance/Current period Opening balance/Last Period
Joint venture: -- --
Amount based on share-holding ratio -- --
--Net profit -910094.79
--Total comprehensive income -910094.79
Associated enterprise: -- --
Total book value of investment 86032548.98 65714349.12
Amount based on share-holding ratio -- --
--Net profit 13773166.19 6501430.20
--Total comprehensive income 13773166.19 6501430.20
(5) Major limitation on capital transfer ability to the Company from joint venture or associated enterprise
Nil
(6) Excess loss occurred in joint venture or associated enterprise
Nil
(7) Unconfirmed commitment with joint venture investment concerned
Nil
(8) Intangible liability with joint venture or associated enterprise investment concerned
Nil
4. Major conduct joint operation
Nil
5. Structured body excluding in consolidate financial statement
Relevant explanations for structured entities not included in the scope of the consolidated financial statements: Nil
X. Risk related with financial instrument
Main financial instrument of the Company including monetary funds structured deposits account receivable
equity instrument investment financial products loans and account payable etc. more details of the financial
instrument can be found in relevant items of Note V. Risks concerned with the above-mentioned financial
instrument and the risk management policy takes for lower the risks are as follow:
Aims of engaging in the risk management is to achieve equilibrium between the risk and benefit lower the
adverse impact on performance of the Company to minimum standards and maximized the benefit for
shareholders and other investors. Base on the risk management targets the basic tactics of the risk management is
to recognized and analyzed the vary risks that the Company counted established an appropriate risk exposure
baseline and caring risk management supervise the vary risks timely and reliably in order to control the risk in a
limited range.In business process the risks with financial instrument concerned happen in front of the Company mainly
including credit exposure market risk and liquidity risk. BOD of the Company takes full charge of the risk
management target and policy-making and takes ultimate responsibility for the target of risk management and
policy. Compliance department and financial control department manager and monitor those risk exposures to
ensuring the risks are control in a limited range.
1. Credit Risk
Credit risk refers to the risk that one party of a financial instrument fails to perform its obligations and resulting
in the financial loss of other party. The company's credit risk mainly comes from monetary funds structured
deposits note receivable account receivable other account receivables. The management has established an
appropriate credit policy and continuously monitors the exposure to these credit risks.The monetary funds and structured deposits held by the Company are mainly deposited in financial institutions
such as commercial banks the management believes that these commercial banks have higher credit and asset
status and have lower credit risks.The Company adopts quota policies to avoid credit risks to any financial
institutions.
For accounts receivable other receivables and bills receivable the Company sets relevant policies to control the
credit risk exposure. To prevent the risks the company has formulated a new customer credit evaluation system
and an existing customer credit sales balance analysis system. The new customer credit evaluation system aims at
new customers the company will investigate a customer’s background according to the established process to
determine whether to give the customer a credit line and the credit line size and credit period. Accordingly the
company has set a credit limit and a credit period for each customer which is the maximum amount that does not
require additional approval. The analysis system for credit sales balance of existing customers means that after
receiving a purchase order from an existing customer the company will check the order amount and the balance
of the accounts owed by the customer so farif the total of the two exceeds the credit limit of the customer the
company can only sell to the customer on the premise of additional approval otherwise the customer must be
required to pay the corresponding amount in advance. In addition for the credit sales that have occurred the
company analyzes and audits the monthly statements for risk warning of accounts receivable to ensure that the
company’s overall credit risk is within a controllable range.The maximum credit risk exposure of the Company is the carrying amount of each financial asset on the balance
sheet.
2. Market risk
Market risk of the financial instrument refers to the fair value of financial instrument or future cash flow due to
fluctuations in the market price changes and produce mainly includes the IRR FX risk and other price risk.
(1) Interest rate risk (IRR)
IRR refers to the fluctuate risks on Company’s financial status and cash flow arising from rates changes in market.IRR of the Company mainly related with the bank loans. In order to lower the fluctuate of IRR the Company in
line with the anticipative change orientation choose floating rate or fixed rate that is the rate in future period will
goes up prospectively than choose fixed rate; if the rate in future period will decline prospectively than choose
the floating rate. In order to minor the bad impact from difference between the expectation and real condition
loans for liquid funds of the Company are choose the short-term period and agreed the terms of prepayment in
particular.
(2) Foreign exchange (FX) risk
FX risks refer to the losses arising from exchange rate movement. The FX risk sustain by the Company mainly
related with the USD EUR SF JPY HKD DKK except for the USD EUR SF JPY HKD and DKK carried out
for the equipment purchasing of parent company and Autocam material purchasing of parent company technical
service and trademark usage costs of parent company the import and export of Weifu International Trade
operation of IRD and operation of Borit other main business of the Company are pricing and settle with RMB
(Yuan). In consequence of the foreign financial assets and liabilities takes minor ratio in total assets the Company
has small FX risk of the financial instrument considered by management of the Company.
End as 31st December 2020 except for the follow assets or liabilities listed with foreign currency assets and
liabilities of the Company are carried with RMB
① Foreign currency assets of the Company till end of 31st December 2020:
Cash on hand
Ending foreign
currency balance
Convert rate Ending RMB balance converted Ratio in assets (%)
Monetary funds
Including: USD 11596564.24 6.5249 75666419.10 0.28
EUR 3694505.41 8.025 29648405.15 0.11
HKD 11548347.98 0.84164 9719551.59 0.04
DKK 9616906.23 1.0786 10372795.06 0.04
Account receivable
Including: USD 2190411.21 6.5249 14292214.10 0.05
EUR 1290945.42 8.025 10359837.00 0.04
JPY 12179808.00 0.063236 770202.34 0.00
DKK 2239065.57 1.0786 2415056.12 0.01
Other account receivables
Including: USD 70143.68 8.025 562903.03 0.00
DKK 462081.08 1.0786 498400.65 0.00
Total ratio in assets 0.57
② Foreign currency liability of the Company till end of 31st December 2020:
Cash on hand
Ending foreign
currency balance
Convert rate Ending RMB balance converted Ratio in assets(%)
Short-term borrowings
Including: EUR 4981278.48 8.025 39974759.80 0.47
Account payable
Including: USD 812035.19 6.5249 5298448.41 0.06
EUR 1031866.82 8.025 8280731.24 0.10
JPY 15780699.00 0.063236 997908.28 0.01
CHF 103580.75 7.4006 766559.70 0.01
DKK 2865734.26 1.0786 3090980.97 0.04
GBP 59450.00 8.8903 528528.34 0.01
Interest payable
Including: EUR 2065.46 8.025 16575.32 0.00
Other account payable
Including: EUR 255.00 8.025 2046.38 0.00
DKK 402113.23 1.0786 433719.33 0.01
Total ratio in liabilities 0.71
③ Other pricing risk 1
The equity instrument investment held by the Company with classification as transaction financial asset and other
non-current financial assets are measured on fair value of the balance sheet date. The fluctuation of expected price
for these investments will affect the gains/losses of fair value changes for the Company.
Furthermore on the premise of deliberated and approved in 10
th
session of 8
th
BOD the Company exercise entrust
financing with the self-owned idle capital; therefore the Company has the risks of collecting no principal due toentrust financial products default. Aims at such risk the Company formulated a “Management Mechanism of
Capital Financing” and well-defined the authority approval investment decision-making calculation
management and risk controls for the entrust financing in order to guarantee a security funds and prevent
investment risk efficiently. In order to lower the adverse impact from unpredictable factors the Company choose
short-term and medium period for investment and investment product’s term is up to 3 years in principle; in
variety of investment the Company did not invest for the stocks derivative products security investment fund
and the entrust financial products aims at security investment as well as other investment with securities
concerned.
3. Liquidity risk
Liquidity risk refers to the capital shortage risk occurred during the clearing obligation implemented by the
enterprise in way of cash paid or other financial assets. The Company aims at guarantee the Company has rich
capital to pay the due debts therefore a financial control department is established for collectively controlling
such risks. On the one hand the financial control department monitoring the cash balance the marketable
securities which can be converted into cash at any time and the rolling forecast on cash flow in future 12 months
ensuring the Company on condition of reasonable prediction owes rich capital to paid the debts; on the other
hand building a favorable relationship with the banks rationally design the line of credit credit products and
credit terms guarantee a sufficient limit for bank credits in order to satisfy vary short-term financing
requirements.XI. Disclosure of fair value
1. Ending fair value of the assets and liabilities measured by fair value
In RMB/CNY
Item
Ending fair value
First-order Second-order Third-order Total
I. Sustaining measured by fair value -- -- -- --
(I) Transaction financial asset 188108256.00 326848122.00 4809264982.10 5324221360.10
1.Financial assets measured at fair
value and whose changes are
included in current profit or loss
188108256.00 326848122.00 4809264982.10 5324221360.10
(1) Investment in debt instruments 4797324683.10 4797324683.10
(2) Investment in equity instruments 188108256.00 326848122.00 11940299.00 526896677.00
(3) Derivative financial assets 334488446.37
(2) Investment in equity instruments 334488446.37
(III) Other equity instrument
investment
285048000.00 285048000.00（IV）Financing of accounts
receivable
1005524477.88 1005524477.88
Total liability sustaining measured
by fair value
188108256.00 326848122.00 6099837459.98 6614793837.98
II. Non-persistent measure -- -- -- --
2. Recognized basis for the market price sustaining and non-persistent measured by fair value on
first-order
On 31 December 2020 the financial assets available for sale-equity instrument investment held by the Company
refers to the SDEC (stock code: 600841) and Miracle Automation (Stock code: 002009) determining basis of the
market price at period-end refers to the closing price of 31 December 2020.3. The qualitative and quantitative information for the valuation technique and critical parameter that
sustaining and non-persistent measured by fair value on second-order
On 31 December 2020 other non-current financial assets-equity instrument investment held by the Company
refers to the Guolian Securities (stock code: 601456) determining basis of the market price at period-end refers to
the closing price and liquidity discounts of 31 December 2020.
4. The qualitative and quantitative information for the valuation technique and critical parameter that
sustaining and non-persistent measured by fair value on third-order
(1) Fair value of wealth management products
The fair value of wealth management products is determined by the Company using discounted cash flow
valuation techniques.Among them the important unobservable input values are mainly the expected annualized
rate of return and the risk factor of wealth management products.
(2) Financing of accounts receivable
For this part of financial assets the Company uses discounted cash flow valuation techniques to determine its fair
value. Among them important unobservable input values mainly include discount rate and contractual cash flow
maturity period. The cash flow with a contract expiration period of 12 months (inclusive) shall not be discounted
and the cost shall be regarded as its fair value.
(3) Fair value of equity instrument investment and other equity instrument investment
Due to the lack of market liquidity for this part of financial assets the Company uses the replacement cost method
to determine its fair value.Among them the important unobservable input values mainly include the financial data
of the invested company etc.
5. Continuous third-level fair value measurement items adjustment information between the opening and
closing book value and sensitivity analysis of unobservable parameters
Nil
6. Continuous fair value measurement items if there is a conversion between various levels in the current
period the reasons for the conversion and the policy for determining the timing of the conversion
Nil
7. Changes in valuation technology during the current period and reasons for the changes
Nil
8. The fair value of financial assets and financial liabilities not measured by fair value
Nil
9. Other
Nil
XII. Related party and related party transactions
1. Parent company of the enterprise
Parent company Registration place Business nature Registered capital
Share-holding ratio
on the enterprise for
parent company
Voting right ratio on
the enterprise
Wuxi Industry
Group
Wuxi
Operation of
state-owned assets
5172.6571 million
Yuan
20.22% 20.22%
Explanation on parent company of the enterprise
Wuxi Industry Group is an enterprise controlled by the State-owned Assets Management Committee of Wuxi
Municipal People’s Government. Its business scope includes foreign investment by using its own assets house
leasing services self-operating and acting as an agent for the import and export business of various commodities
and technologies (Except for goods and technologies that are restricted by the state or prohibited for import and
export) domestic trade (excluding national restricted and prohibited items). (Projects that are subject to approval
in accordance with the law can be operated only after being approved by relevant departments).Ultimate controller of the Company is State-owned Assets Supervision & Administration Commission of Wuxi Municipality of
Jiangsu Province.Other explanation: Nil
2. Subsidiary of the Enterprise
Found more in Note IX. 1.” Equity in subsidiary”
3. Joint venture and associated enterprise
Found more in Note IX.3. “Equity in joint venture and associated enterprise”
Other associated enterprise or joint ventures which has related transaction with the Company in the period or occurred previous:
Nil
4. Other Related party
Other Related party Relationship with the Enterprise
Robert Bosch Company Second largest shareholder of the Company
Key executive Director supervisor and senior executive of the Company
5. Related transaction
(1) Goods purchasing labor service providing and receiving
Goods purchasing/labor service receiving
In RMB/CNY
Related party
Content of
related
transaction
Current period
Approved transaction
limit
Whether more than
the transaction limit
(Y/N)
Last Period
Weifu Precision
Machinery
Goods and labor 34570825.03 30000000.00 Y 37649400.25
Bosch Diesel System Goods and labor 29740591.61 25000000.00 Y 42492806.04
Weifu Environment Goods 3051418777.65 3200000000.00 N 1663362526.18
Robert Bosch
Company
Goods and labor 150855622.37 153000000.00 N 173854905.98
Shinwell Automobile
Tech. (Wuxi) Co. Ltd.Goods 1733572.01 5000000.00 N 11195174.16
Goods sold/labor service providing
In RMB/CNY
Related party Content of related transaction Current period Last Period
Weifu Precision Machinery Goods and labor 6092391.01 1428332.05
Bosch Diesel System Goods and labor 2961684269.09 2670139591.68
Weifu Environment Goods and labor 29663885.81 29810340.60
Robert Bosch Company Goods and labor 860611502.90 730599270.85
Shinwell Automobile Tech.(Wuxi) Co. Ltd.Goods 103329.66 1241682.55
Description of related transactions in the purchase and sale of goods provision and acceptance of labor services Nil
(2) Related trusteeship management/contract & entrust management/ outsourcing
Nil
(3) Related lease
As a lessor for the Company:
In RMB/CNY
Lessee Assets type
Lease income recognized in the
Period
Lease income recognized at last
Period
Weifu Environment Workshop 2508057.00 2508057.00
Explanation on related lease
Weifu Leader entered into the house leasing contract with Weifu Environment as for the plant locates at No.9
Linjiang Road Wuxi new district owed by Weifu Leader rent-out to Weifu Environment agreements are made
as: Rental from 1 January 2020 to 31 December 2020 was 2508057.00 Yuan
(4) Related guarantee
Nil
(5) Related party’s borrowed/lending funds
Related party Loan amount Start date Maturity Note
Borrowing
Wuxi Industry Group 5470000.00
This year Weifu Leader received borrowed
funds from Wuxi Industry Group.Lending
(6) Related party’s assets transfer and debt reorganization
Nil
(7) Remuneration of key manager
In RMB/CNY
Item Current period Last Period
Remuneration of key manager 16986000.00 5370000.00
(8) Other related transactions
Related party Name Current period Last Period
Weifu Precision Machinery Payable for technical services 54783.81 --
Weifu Precision Machinery Purchase of fixed assets 145200.00 --
Bosch Diesel System Technology royalties paid etc. 184740.27 337369.76
Bosch Diesel System Purchase of fixed assets 447692.06 5720900.23
Bosch Diesel System Technology royalties paid etc. 295419.00
Robert Bosch Company Technology royalties paid etc. 5072260.23 3489339.19
Robert Bosch Company Payable for technical services -- 702303.80
Robert Bosch Company Purchase of fixed assets 22927889.53 6150100.00
Weifu Environment House rental fee payable -- 214285.71
Weifu Environment Purchase of fixed assets 30000.00 148668.39
Weifu Environment Payable for technical services 64433.96 --
Weifu Environment Sales of fixed assets 9426.00 --
Wuxi Industry Group Interest paying 89564.40
6. Receivable/payable items of related parties
(1) Receivable item
In RMB/CNY
Item Related party
Ending balance Opening balance
Book balance Bad debt reserve Book balance Bad debt reserve
Account receivable
Weifu Precision
Machinery
160565.87 243544.57
Other account
receivables
Weifu Precision
Machinery
1070000.00
Account receivable Bosch Diesel System 549543387.12 547423047.70
Account receivable
Robert Bosch
Company
205738695.62 84473.87 155195576.42 135534.13
Other account
receivables
Robert Bosch
Company
7600000.00 1520000.00
Account receivable Weifu Environment 642390.75 3925564.95
Other account
receivables
Weifu Environment 49000000.00
Other non-current
assets
Weifu Precision
Machinery
53788.00
Other non-current
assets
Bosch Diesel System 183842.03
Account paid in
advance
Robert Bosch
Company
2970930.93 5954823.56
Other non-current
assets
Robert Bosch
Company
6600000.00
(2) Payable item
In RMB/CNY
Item Related party Ending book balance Opening book balance
Account payable Weifu Precision Machinery 12959303.46 10556782.28
Other account payable Weifu Precision Machinery 29000.00 29000.00
Account payable Weifu Environment 850384640.88 553049630.17
Account payable Bosch Diesel System 7178387.17 5664266.10
Account payable Robert Bosch Company 5370249.46 12297410.48
Account payable Shinwell Automobile Tech. (Wuxi) Co. Ltd. 19320.30 2212768.26
Other current liabilities Bosch Diesel System 169620804.78 69164600.47
Other current liabilities Weifu Precision Machinery 74778.76
Other account payable Wuxi Industry Group 5474862.22
Contract liabilities Weifu Precision Machinery 619469.03
Contract liabilities Bosch Diesel System 0.36
Contract liabilities Robert Bosch Company 18094.85 854162.51
Contract liabilities Weifu Environment 5812521.86
7. Undertakings of related party
Nil
8. Other
Nil
XIII. Share-based payment
1. Overall situation of share-based payment
√ Applicable □ Not applicable
In RMB/CNY
Total amount of various equity instruments granted by the
company in the current period
509994000.00
Total amount of various equity instruments exercised by the
company in the current period
0.00
Total amount of various equity instruments invalidated by the
company in the current period
0.00
The scope of the exercise price of the stock options issued by
the company at the end of the period and the remaining
period of the contract
The grant price is 15.48 Yuan per share; the exercise time is from the
first trading day 24 months after the completion of the registration of
the restricted stocks granted in the first tranche to the last trading
day within 60 months from the date of completion of the registration
of the restricted stock granted in the first tranche so the remaining
period of the contract is 4 years and 11 months.The scope of the exercise price of other equity instruments
issued by the company at the end of the period and the
remaining period of the contract
N/A
2. Share-based payment settled by equity
√ Applicable □ Not applicable
In RMB/CNY
Method for determining the fair value of equity instruments on the
grant date
Determine based on the closing price of the restricted stock on
the grant date
Basis for determining the number of vesting equity instruments Unlocking conditions
Reasons for the significant difference between estimate in the
current period and estimate in the prior period
Not Applicable
Cumulative amount of equity-settled share-based payments
included in the capital reserve
6484837.50
Total amount of expenses confirmed by equity-settled share-based
payments in the current period
6484837.50
Other explanations:
This restricted stock incentive plan has been reviewed and approved by the company's second extraordinary
general meeting of shareholders in 2020. The overview of this restricted stock incentive plan is as follows:
(1) Stock source: the company's A-share common stock repurchased from the secondary market.
(2) Grant date: November 12 2020.
(3) Grant objects and number of grants: 19540000 restricted stocks were granted to 601 incentive objects of the
company and its subsidiaries.
(4) Grant price: 15.48 Yuan/share.
(5) Grant registration completion date: December 4 2020.
(6) Lifting the restrictions on sales:
Unlock period Unlock time
Ratio of unlocked quantity to
granted quantity
Phase I unlocked
Starting from the first trading day 24 months after the completion of the
registration of the first grant and ending on the last trading day within 36 months
Phase II unlocked
Starting from the first trading day 36 months after the completion of the
registration of the first grant and ending on the last trading day within 48 months
Phase III unlocked
Starting from the first trading day 48 months after the completion of the
registration of the first grant and ending on the last trading day within 60 months
(7) Performance appraisal requirements at the company level:
Unlock conditions Performance appraisal requirements
The first batch of unlock
conditions
1. the weighted average ROE for year of 2021 is not less than 10%;
2. the growth rate of self-operating profit in 2021 will not be less than 6% compared with the year of 2019 the
absolute amount will not be less than 845 million Yuan;
238
3. the cash dividends for year of 2021 shall be no less than 50% of the profit available for distribution of the
current year.The second batch of
unlocking conditions
1. the weighted average ROE for year of 2022 is not less than 10%;
2. the growth rate of self-operating profit in 2022 will not be less than 12% compared with the year of 2019 the
absolute amount will not be less than 892 million Yuan;
3. the cash dividends for year of 2022 shall be no less than 50% of the profit available for distribution of the
current year.The third batch of
unlocking conditions
1. the weighted average ROE for year of 2023 is not less than 10%;
2. the growth rate of self-operating profit in 2023 will not be less than 20% compared with the year of 2019 the
absolute amount will not be less than 958 million Yuan;
3. the cash dividends for year of 2023 shall be no less than 50% of the profit available for distribution of the
current year.Other explanation:self-operating profit refers to the net profit attributable to the owners of the parent company after deducting
non-recurring gains and losses and deducting the investment income from Bosch Diesel System and CNEMS.
3. Share-based payment settled by cash
□ Applicable √ Not applicable
4. Modification and termination of share-based payment
Nil
5. Other
Nil
XIV. Undertakings or contingency
1. Important undertakings
Important undertakings on balance sheet date
Nil
2. Contingency
(1) Contingency on balance sheet date
Nil
(2) For the important contingency not necessary to disclosed by the Company explained reasons
The Company has no important contingency that need to disclosed
239
(3) Other information required by the Guidelines for Information Disclosure of Automobile Manufacturing
Related Industries
Mortgage sales financial leasing and other models of sales accounted for more than 10% of operating income
□ Applicable √ Not applicable
The company's guarantee to the dealer
□ Applicable √ Not applicable
3. Other
Nil
XV. Events after balance sheet date
1. Important non adjustment matters
Nil
2. Profit distribution
In RMB/CNY
Profit or dividend plans to distributed 1513341439.50
Profit or dividend declare to distributed which have been approved 1513341439.50
3. Sales return
Nil
4. Other events after balance sheet date
(1)The Proposal on External Investment was deliberated and approved by the 22
nd
session of 9
th
BOD dated 26
Feb. 2021. the Company intends to invest in Qingdao Shangqi HuiZhu Zhanxing Industry Investment Fund
(Limited Partnership) with its own funds of 150 million Yuan.
(2) According to the resolution of the 23
rd
session of the 9
th
board of directors of the company held on April 16
2021 the company plans to use its own idle funds for entrusted financial management in 2021 with the total
investment amount not exceeding 9.5 billion Yuan and the above amount can be rolled
XVI. Other important events
1. Previous accounting errors collection
Nil
240
2. Debt restructuring
Nil
3. Assets replacement
Nil
4. Pension plan
The Enterprise Annuity Plan under the name of WFHT has deliberated and approved by 8
th
session of 7
th
BOD: in
order to mobilize the initiative and creativity of the employees established a talent long-term incentive
mechanism enhance the cohesive force and competitiveness in enterprise the Company carried out the above
mentioned annuity plan since the date of reply of plans reporting received from labor security administration
department. Annuity plans are: the annuity fund are paid by the enterprise and employees together; the
enterprise’s contribution shall not exceed 8% of the gross salary of the employees of the enterprise per year the
combined contribution of the enterprise and the individual employee shall not exceed 12% of the total salary of
the employees of the enterprise. In accordance with the State’s annuity policy the Company will adjusted the
economic benefits in due time in principle of responding to the economic strength of the enterprise the amount
paid by the enterprise at current period control in the 8 percent of the total salary of last year the maximum annual
allocation to employees shall not exceed five times the average allocation to employees and the excess shall not be
counted towards the allocation. The individual contribution is limited to 1% of one’s total salary for the previous
year. Specific paying ratio later shall be adjusted correspondingly in line with the operation condition of the
Company.
In December 2012 the Company received the Reply on annuity plans reporting under the name of WFHT from
labor security administration department later the Company entered into the Entrusted Management Contract of
the Annuity Plan of WFHT with PICC.
5. Termination of operation
Not applicable
6. Segment
(1) Recognition basis and accounting policy for reportable segment
Determine the operating segments in line with the internal organization structure management requirement and
internal reporting system. Operating segment of the Company refers to the followed components that have been
satisfied at the same time:
① The component is able to generate revenues and expenses in routine activities;
② Management of the Company is able to assess the operation results regularly and determine resources
allocation and performance evaluation for the component;
③ Being analyzed financial status operation results and cash flow of the components are able to require by the
Company
The Company mainly engaged in the manufacture of fuel system of internal combustion engine and fuel cell
components products auto components muffler and purifier etc. based on the product segment the Company
determine three reporting segments as auto fuel injection system and fuel cell components air management
system and automotive post processing system. Accounting policy for the three reporting segments are shares the
same policy state in Note V
Segment assets exclude transaction financial asset other account receivables-dividend receivable other
non-current financial assets other equity instrument investment long term equity investment and other
undistributed assets since these assets are not related to products operation.
(2) Financial information for reportable segment
In RMB/CNY
Item
Automotive fuel
injection system
and fuel cell parts
product division
Product segment
of automotive
post processing
system
Product segment
of air
management
system
Add:
investment/income
measured by
equity income of
financial products
or possession and
disposal income
the retained assets
or gains/losses as
the financial assets
available for sale or
possession and
disposal income
Offset of
segment
Total
Operating
revenue
5993310683.00 6427844701.00 697872646.74 235201724.14 12883826306.60
Operating cost 4448683801.55 5731947799.03 446496408.80 197843567.41 10429284441.97
Total Profit 524729824.97 96006636.11 71788594.68 2309901783.97 -524839.83 3002951679.56
Net profit 452179859.49 101778469.69 55671416.42 2212713056.22 -393128.74 2822735930.56
Total assets 11471288383.40 5342888369.35 1013319278.74 10404823830.96 881624474.24 27350695388.21
Total liabilities 3923773971.66 4225004372.65 592960211.88 1235734.93 186744801.93 8556229489.19
(3)If the company has no reportable segments or is unable to disclose the total assets and liabilities of each
reportable segment it should state the reasons
Not applicable
(4)Other explanations
Nil
7. Major transaction and events makes influence on investor’s decision
Nil
8. Other
Nil
XVII. Principal notes of financial statements of parent company
1. Account receivable
(1) Classification of account receivable
In RMB/CNY
Category
Ending balance Opening balance
Book balance Bad debt reserve
Book
value
Book balance Bad debt reserve
Book value
Amount Ratio Amount
Accrual
ratio
Amount Ratio Amount
Accrual
ratio
Account receivable
with bad debt
provision accrual on
a single basis
111071
23.51
1.11%
111071
23.51
100.00%
9107123
.51
1.06%
9107123
.51
100.00%
Including:
Account receivable
with bad debt
provision accrual on
portfolio
985882
139.36
98.89%
309986
0.14
0.31%
9827822
79.22
8519565
78.91
98.94%
3716569
.87
0.44%
84824000
9.04
Including:
Including:
receivables from
customers
836329
626.26
83.89%
309986
0.14
0.37%
8332297
66.12
7157227
90.25
83.12%
3716569
.87
0.52%
71200622
0.38
Receivables from
internal related
parties
149552
513.10
15.00%
1495525
13.10
1362337
88.66
15.82%
13623378
8.66
Total
996989
262.87
100.00%
142069
83.65
1.42%
9827822
79.22
8610637
02.42
100.00%
1282369
3.38
1.49%
84824000
9.04
Bad debt provision accrual on single basis: RMB 11107123.51
In RMB/CNY
Name
Ending balance
Book balance
Bad debt
reserve
Accrual
ratio
Accrual causes
BD bills 7300000.00 7300000.00 100.00% Have difficulty in collection
Changchun FAW Sihuan Engine Manufacturing Co.
Ltd
1475731.65 1475731.65 100.00% Have difficulty in collection
Wuxi Kipor Machinery Co. Ltd 1220384.74 1220384.74 100.00% Have difficulty in collection
Fujian Zhao’an Country Minyue Bianjie Agricultural
Machinery Automobile components Co. Ltd.
1111007.12 1111007.12 100.00% Have difficulty in collection
Total 11107123.51 11107123.51 -- --
Bad debt provision accrual on portfolio: RMB 3099860.14
In RMB/CNY
Name
Ending balance
Book balance Bad debt reserve Accrual ratio
Within 6 months 822921167.68
6 months to one year 8783211.93 878321.19 10.00%
1-2 years 2434208.25 486841.65 20.00%
2-3 years 760568.50 304227.40 40.00%
Over 3 years 1430469.90 1430469.90 100.00%
Total 836329626.26 3099860.14 --
If the provision for bad debts of accounts receivable is made in accordance with the general model of expected credit losses please refer
to the disclosure of other receivables to disclose related information about bad-debt provisions:
□ Applicable √ Not applicable
By account age
In RMB/CNY
Account age Book balance
Within one year (One year included) 976000464.78
Including: within 6 months 965950994.85
6 months to one year 10049469.93
1-2 years 7690636.18
2-3 years 10292548.30
Over 3 years 3005613.61
3-4 years 3005613.61
Total 996989262.87
(2) Bad debt provision accrual collected or switch back
Bad debt provision accrual in the period:
In RMB/CNY
Category Opening balance
Amount changed in the period
Ending balance
Accrual
Collected or
reversal
Written-off Other
Bad debt
provision
12823693.38 1336214.96 210660.88 257736.19 14206983.65
Total 12823693.38 1336214.96 210660.88 257736.19 14206983.65
Important bad debt provision collected or switch back: nil
(3) Account receivable actual charge off in the Period
In RMB/CNY
Item Amount charge off
Fuzhou Haominxing Automobile components Co. Ltd. 129739.47
Kunming Yunnei Power Co. Ltd. 47449.10
Xinxiang Xincheng Machinery Equipment Co. Ltd. 28895.81
Other customers 4576.50
Total 210660.88
Major charge-off for the major receivable: nil
Account receivable write-off explanation: the funds are not generated by connected transactions
(4) Top 5 receivables at ending balance by arrears party
In RMB/CNY
Name
Ending balance of account
receivable
Ratio in total ending balance of
account receivables
Ending balance of bad debt
reserve
Bosch Diesel System 548842896.72 55.05%
Weifu ITM 68976711.20 6.92%
Weifu Leader 55481232.29 5.56%
Custom 4 49207860.47 4.94% 703826.23
Custom 5 45023657.85 4.52% 102723.13
Total 767532358.53 76.99%
(5) Account receivable derecognition due to financial assets transfer
Nil
(6) Assets and liabilities resulted by account receivable transfer and continues involvement
Nil
2. Other account receivables
In RMB/CNY
Item Ending balance Opening balance
Interest receivable 897777.78 804929.68
Dividend receivable 1070000.00
Other account receivables 196437936.85 248140027.06
Total 197335714.63 250014956.74
(1) Interest receivable
1) Category of interest receivable
In RMB/CNY
Item Ending balance Opening balance
Interest receivable of unified-borrowing & unified-lending 897777.78 149876.70
Interest of fund occupation 655052.98
Total 897777.78 804929.68
2) Significant overdue interest
Nil
3) Accrual of bad debt provision
□ Applicable √ Not applicable
(2) Dividend receivable
1) Category of dividend receivable
In RMB/CNY
Item (or invested enterprise) Ending balance Opening balance
Weifu Precision Machinery 1070000.00
Total 1070000.00
2) Important dividend receivable with account age over one year
Nil
3) Accrual of bad debt provision
□ Applicable √ Not applicable
(3) Other account receivables
1) Other account receivables classification by nature
In RMB/CNY
Nature Ending book balance Opening book balance
Staff loans and petty cash 483650.21 462664.16
Balance of related party in the consolidate scope 194745396.72 216403060.04
Margin 1030340.00
Intercourse funds of unit 24000000.00
Protean Holdings Corp. equity disposal fund 10654092.89
Other 263534.00 117939.00
Total 196522920.93 251637756.09
2) Accrual of bad debt provision
In RMB/CNY
Bad debt reserve
Phase I Phase II Phase III
Total
Expected credit
losses over next 12
months
Expected credit losses for
the entire duration (without
credit impairment occurred)
Expected credit losses for
the entire duration (with
credit impairment occurred)
Balance of Jan. 1 2020 3497729.03 3497729.03
Balance of Jan. 1 2020
in the period
—— —— —— ——
Current accrual 52664.34 52664.34
Current reversal 3465409.29 3465409.29
Balance on Dec. 31 2020 84984.08 84984.08
Change of book balance of loss provision with amount has major changes in the period
□ Applicable √ Not applicable
By account age
In RMB/CNY
Account age Book balance
Within one year (One year included) 160889115.00
Within 6 months 71626274.30
6 months to one year 89262840.70
1-2 years 35552695.72
2-3 years 43570.21
Over 3 years 37540.00
3-4 years 37540.00
Total 196522920.93
3) Bad debt provision accrual collected or switch back
Bad debt provision accrual in the period:
In RMB/CNY
Category
Opening
balance
Amount changed in the period
Ending balance
Accrual
Collected or
reversal
Written-off Other
Bad debt provision 3497729.03 52664.34 3465409.29 84984.08
Total 3497729.03 52664.34 3465409.29 84984.08
Including the important bad debt provision switch back or collected in the period: nil
4) Other receivables actually written-off during the reporting period
Nil
5) Top 5 other receivables at ending balance by arrears party
In RMB/CNY
Enterprise Nature Ending balance Account age
Ratio in total ending
balance of other
receivables
Ending balance of
bad debt reserve
Weifu Leader
Balance of related party in
the consolidate scope
100000000.00 Within 1 year 50.88%
Weifu Chang’an
Balance of related party in
the consolidate scope
54192781.00 Within 1 year 27.58%
Weifu Schmidt
Balance of related party in
the consolidate scope
21000000.00 1-2 years 10.68%
Weifu Mashan
Balance of related party in
the consolidate scope
19552615.72 Within 2 years 9.95%
Zhenkunxing
Industrial
Supermarket
(Shanghai) Co. Ltd.Margin 1000000.00 Within 6 months 0.51%
Total -- 195745396.72 -- 99.60%
6) Other account receivables related to government grants
Nil
7) Other receivable for termination of confirmation due to the transfer of financial assets
Nil
8) The amount of assets and liabilities that are transferred other receivable and continued to be involved
Nil
3. Long-term equity investments
In RMB/CNY
Item
Ending balance Opening balance
Book balance
Depreciati
on
reserves
Book value Book balance
Depreciati
on
reserves
Book value
Investment for subsidiary 1978302303.40 1978302303.40 1731814008.11 1731814008.11
Investment for associates
and joint venture
3999826000.48 3999826000.48 4599549621.93 4599549621.93
Total 5978128303.88 5978128303.88 6331363630.04 6331363630.04
(1) Investment for subsidiary
In RMB/CNY
The invested
entity
Opening balance
(book value)
Changes in Current Period
Ending balance
(book value)
Ending
balance of
depreciation
reserves
Additional
Investment
Negative
Investment
Provision
for
impairment
loss
Other
Weifu Jinning 178639593.52 569165.62 179208759.14
Weifu Leader 460113855.00 731784.39 460845639.39
Weifu Mashan 168693380.51 154321.87 168847702.38
Weifu Chang’an 220902037.30 144365.63 221046402.93
Weifu
International
Trade
32849254.85 59737.50 32908992.35
Weifu ITM 167000000.00 167000000.00
Weifu Schmidt 50160000.00 84628.12 50244628.12
Weifu Tianli 234941100.00 243928.12 235185028.12
Weifu Autocam 82454467.99 82454467.99
Weifu
Electronic Drive
53832280.23 54759.38 53887039.61
SPV 82228038.71 411445604.66 493673643.37
Total 1731814008.11 413488295.29 167000000.00 1978302303.40
(2) Investment for associates and joint venture
In RMB/CNY
Enterprise
Opening balance
(book value)
Current changes (+ -)
Ending balance
(book value)
Endin
g
balan
ce of
depre
ciatio
n
reserv
es
Addit
ional
invest
ment
Capit
al
reduc
tion
Investment
gain/loss
recognized
under equity
Other
compre
hensive
income
adjustm
ent
Othe
r
equit
y
chan
ge
Cash dividend
or profit
announced to
issued
Impair
ment
accrual
Other
I. Joint venture
II. Associated enterprise
Bosch
Diesel
System
3276853986.35
1132865918.6
9
-1722195225.
51
2687524679.53
Zhonglian
Automobile
1261232635.30 307716221.01 -331400000.00 1237548856.31
Weifu
Precision
Machinery
61463000.28 16889464.36 -3600000.00 74752464.64
Subtotal 4599549621.93
1457471604.0
6
-2057195225.
51
3999826000.48
Total 4599549621.93
1457471604.0
6
-2057195225.
51
3999826000.48
(3)Other explanations
Nil
4. Operating income and cost
In RMB/CNY
Item
Current period Last Period
Income Cost Income Cost
Main business 4164444997.29 2955881019.87 3470103915.90 2330022370.30
Other business 371972806.50 280430592.86 362821444.52 311590544.97
Total 4536417803.79 3236311612.73 3832925360.42 2641612915.27
5. Investment income
In RMB/CNY
Item Current period Last Period
Investment income from holding transaction financial asset 683211.60 1383668.59
Dividend income from holding other equity instrument investment 900000.00
Investment income in subsidiaries 62995075.18 105086820.44
Investment income in joint ventures and associated enterprises 1457471604.06 1310687436.86
Investment income of financial products 258702394.98 228151138.50
Other 36907117.60
Total 1816759403.42 1646209064.39
6. Other
Nil
XVIII. Supplementary Information
1. Current non-recurring gains/losses
√ Applicable □ Not applicable
In RMB/CNY
Item Amount Note
Gains/losses from the disposal of non-current asset 10719959.77
Governmental subsidy reckoned into current gains/losses (not including the subsidy enjoyed
in quota or ration according to national standards which are closely relevant to enterprise’s
business)
146475795.26
Profit and loss of assets delegation on others’ investment or management 271684174.09
Held transaction financial asset gains/losses of changes of fair values from transaction
financial liabilities and investment gains from disposal of transaction financial asset
transaction financial liabilities and financial asset available for sales exclude the effective
hedging business relevant with normal operations of the Company
375102546.00
Switch back of provision for depreciation of account receivable which was singly taken
depreciation test
3078424.43
Other non-operating income and expenditure except for the aforementioned items -3090715.87
Less: Impact on income tax 116175046.47
Impact on minority shareholders’ equity 5011845.35
Total 682783291.86 --
Concerning the extraordinary profit (gain)/loss defined by Q&A Announcement No.1 on Information Disclosure for Companies
Offering Their Securities to the Public --- Extraordinary Profit/loss and the items defined as recurring profit (gain)/loss according to
the lists of extraordinary profit (gain)/loss in Q&A Announcement No.1 on Information Disclosure for Companies Offering Their
Securities to the Public --- Extraordinary Profit/loss explain reasons
□ Applicable √ Not applicable
2. ROE and earnings per share
Profits during report period
Weighted
average ROE
Earnings per share
Basic earnings per share
(RMB/Share)
Diluted earnings per
share (RMB/Share)
Net profits belong to common stock stockholders of the
Company
15.78 2.79 2.79
Net profits belong to common stock stockholders of the
Company after deducting nonrecurring gains and losses
11.90 2.10 2.10
3. Difference of the accounting data under accounting rules in and out of China
(1) Difference of the net profit and net assets disclosed in financial report under both IAS (International
Accounting Standards) and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable √ Not applicable
(2) Difference of the net profit and net assets disclosed in financial report under both foreign accounting
rules and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable √ Not applicable
(3) Explanation on data differences under the accounting standards in and out of China; as for the
differences adjustment audited by foreign auditing institute listed name of the institute
4. Other
For details please refer to the description in Note 535 "Changes in Important Accounting Policies and Accounting Estimates".
Section XIII. Documents available for reference
I. Financial statement carrying the signatures and seals of person in charge of the company principal of the
accounting works and person in charge of accounting organ (accounting Supervisor);
II. Original audit report seal with accounting firms and signature and seal with CPA;
III. Original documents of the Company and manuscripts of public notices that disclosed in Juchao
website(http://www.cninfo.com.cn) designated by CSRC in the report period;
IV. Annual report published on China Securities Journal Securities Times and Hong Kong Commercial Daily
during the Period.
BOD of Weifu High-Technology Group Co. Ltd.
Chairman:
Wang Xiaodong
20 April 2021
沪公网安备31011802005267号
