Chongqing Changan Automobile Company Limited
2019 Semi-annual Report
August 2019
Chapter 1 Important Notice Contents and Definitions
The Board of Directors the Board of Supervisors Directors Supervisors and Senior Executives
of the company hereby guarantee that no false or misleading statement or major omission was made
to the materials in this report and that they will assume all the responsibilities individually and
jointly for the trueness accuracy and completeness of the contents of this report.
All the directors attended the board meeting for reviewing the semi-annual report.
For the first half of 2019 the Company has no plans of cash dividend no bonus shares and no
share converted from capital reserve.The Chairman of the Board Zhang Baolin the Chief Financial Officer Zhang Deyong and the
responsible person of the accounting institution (Accountant in charge) Chen Jianfeng hereby
declare that the Financial Statements enclosed in this annual report are true accurate and complete.The prospective description regarding future business plan and development strategy in this
report does not constitute virtual commitment. The investors shall pay attention to the risk.The report shall be presented in both Chinese and English and should there be any conflicting
understanding of the text the Chinese version shall prevail.
CONTENTS
Chapter 1 Important Notice Contents and Definitions ............................................. 1
Chapter 2 Company Profile & Main Financial Indexes ............................................. 4
Chapter 3 Analysis of Main Business ........................................................................ 8
Chapter 4 Business Discussion and Analysis ........................................................... 10
Chapter 5 Important Matters .................................................................................... 23
Chapter 6 Changes in the shareholding of the company and shareholders .............. 31
Chapter 7 Information about Directors Supervisors Senior Management ............. 35
Chapter 8 Corporate Bonds ...................................................................................... 35
Chapter 9 The Financial Statements ......................................................................... 36
Chapter 10 Documents for Future Reference ......................................................... 163
Definitions
Items Definitions
Changan Auto. the
Company
Refers to Chongqing Changan Automobile Company Limited
South Industries Refers to China South Industries Group Co. Ltd. the Company’s actual controller
China Changan Refers to
China Changan Automobile Group Co. Ltd. old name: China South
Industries automobile Co. Ltd. a subsidiary company of South Industries
Changan Industry Refers to
Chongqing Changan Industry (Group) Co. Ltd. old name: Changan
Automobile Co. Ltd. Changan Automobile (Group) Co. Ltd. a
subsidiary company of South Industries the controlling shareholder of the
Company before December 2005
Nanjing Changan Refers to
Nanjing Changan Automobile Co. Ltd. a subsidiary company of the
Company
Hebei Changan Refers to
Hebei Changan Automobile Co. Ltd. a subsidiary company of the
Company
Hefei Changan Refers to
Hefei Changan Automobile Co. Ltd. a subsidiary company of the
Company
Changan Bus Refers to Baoding Changan Bus Co. Ltd. a subsidiary company of the Company
International Company Refers to
Chongqing Changan Automobile International Sale Service Co. Ltd. a
subsidiary company of the Company
Changan Suzuki Refers to
Chongqing Changan Suzuki Automobile Co. Ltd a subsidiary company
of the Company
Changan Ford Refers to Changan Ford Automobile Co. Ltd，a JV of the Company
Changan Mazda Refers to Changan Mazda Automobile Co. Ltd a JV of the Company
CME Refers to Changan Mazda Engine Co. Ltd a JV of the Company
CAPSA Refers to Changan PSA Automobiles Co. Ltd，a JV of the Company
Jiangling Holding Refers to Jiangling Holding Co. Ltd. a JV of the Company
Changan Finance Refers to Changan Auto Finance Co.Ltd Company's Joint Stock Company
Financial Co. of CSGC Refers to Financial Co. of China South Industries Group Co. Ltd.
UPI Refers to
United Prosperity (Hong Kong)Investment Co. Ltda subsidiary company
of China Changan
Hafei Group Refers to
Harbin Hafei Automobile Industry Group Co. Ltd. a subsidiary company
of China Changan
CMAL Refers to
Chongqing Changan Minsheng APLL Logistics Co. Ltd a Joint Stock
Company of China Changan.
Chapter 2 Company Profile & Main Financial Indexes
I. Basic Information
Stock abbreviation Changan Automobile 、Changan B Stock Code 000625、200625Listed on Shenzhen Stock Exchange
Company in Chinese
name重庆长安汽车股份有限公司
Company abbreviation in
Chinese name长安汽车
Company name in
English
Chongqing Changan Automobile Company Limited
Legal representative Zhang Baolin
II. Contact Information
Secretary of the Board of Directors Securities affairs representative
Name Li Jun
Contact address
No. 260 East Jianxin Road Jiangbei District
Chongqing
Telephone 023-67594008
Fax 023-67866055
E-mail address cazqc@changan.com.cn
III. Others
1. Way of contact
Whether registration address office address and its post code as well as website and email of the Company changed in the
reporting period or not
□ Applicable √ Not applicable
The registration address office address and post code as well as website and email of the Company did not change in the
reporting period. See more details in Annual Report 2018.
2. Information disclosure and preparation place
Whether information disclosure and preparation place changed in reporting period or not
□ Applicable √ Not applicable
The newspaper appointed for information disclosure the website for the publishment of the semi-annual report appointed by
CSRC and the preparation place for semi-annual report did not change in the reporting period. See more details in Annual Report
2018.
3. Other relevant information
Whether other relevant information changed in the reporting period or not
□ Applicable √ Not applicable
IV. Summary of Accounting Data and Financial Indexes
Does the company conduct the retrospective adjustment or restatement over previous years accounting data due to changes of
accounting policies or accounting errors?
□ Yes √ No
Report period Same period of last year
Increase/decrease
y-o-y (%)
Operating revenue (Yuan) 29875780096.84 35642832190.04 -16.18%
Net profit belonging to shareholders of
the listed company (Yuan)
-2240039761.11 1609606578.84 -239.17%
Net profit belonging to shareholders of
the listed company after deduction of
non-recurring profit and loss (Yuan)
-2911767596.44 695716688.41 -518.53%
Net cash flow arising from operating
activities (Yuan)
4220263630.95 4401401760.15 -4.12%
Basic earnings per share (Yuan/Share) -0.47 0.34 -238.24%
Diluted earnings per share (Yuan/Share) Not applicable Not applicable Not applicable
Return on equity (ROE) (%) -4.97% 3.39% Down 8.36 points
Report period Same period of last year
Increase/decrease
y-o-y (%)
Total assets (RMB) 92648982677.77 93488854098.95 -0.90%
Net assets attributable to shareholder of
the listed company(RMB)
43972470820.42 46244958676.52 -4.91%
V. The differences between domestic and international accounting standards
1. Simultaneously pursuant to both Chinese accounting standards and international accounting standards
disclosed in the financial reports of differences in net income and net assets.
□ Applicable √ Not applicable
No difference
2. Differences of net profit and net assets disclosed in financial reports prepared under overseas and
Chinese accounting standards.
□ Applicable √ Not applicable
No difference
3. Explanation of the differences in accounting data under domestic and overseas accounting standards
□ Applicable √ Not applicable
VI. Non-recurring items and amounts
√ Applicable □ Not applicable
In RMB Yuan
Item Amount Illustration
Non-recurring items and amounts(including accrued reversal assets
impairment part)
9392459.28
Government subsidies included in the profit and loss of the current period
(Except closely related to business operations in accordance with the
national unified standard quota or quantitative enjoyment of government
subsidies)
620733074.11
Current net profit from beginning to combined date of business
combination under common control
In addition to the effective hedging business related to the normal business
of the company the gains and losses from changes in fair value arising
from the holding of trading financial assets derivative financial assets
trading financial liabilities derivative financial liabilities and disposal of
transactional financial assets derivative finance Investment income from
assets trading financial liabilities derivative financial liabilities and other
debt investments
40337151.27
Other non-business income and expenditures other than the above items 6191613.24
Interest on deferred payment of funds received by non-financial enterprises 18205918.42
Subtract: Influenced amount of income tax 13119121.76
Influenced amount of miniority shareholders’ equity (after tax) 10013259.23
Total 671727835.33 --
According to “Public offering of securities information disclosure of the company's information disclosure announcement No. 1 –non-recurring gains and losses” defined non-recurring items and“Public offering of securities information disclosure of thecompany's information disclosure announcement No. 1 - non-recurring gains and losses”The items defined as recurring items are
listed in the announcement No. 1 and shall be explained.
□ Applicable √ Not applicableThe company in the reporting period does not base on the definition and listing of “Public offering of securities information
disclosure of the company's information disclosure announcement No. 1 – non-recurring gains and losses” about non-recurring gains
and losses to define a case of recurring profit or loss.
Chapter 3 Analysis of Main Business
I. The main business of the Company in the reporting period
Does the Company need to comply with the disclosure requirements of special industry
□ Yes √ No
During the reporting period the company's main business is the R&D manufacturing and sale of cars the R&D and production
of automobile engine products. Besides the company integrates advantageous resources to actively develop travel services new
retail and so on and carry out multi-dimensional industrial layout.
Changan automobile always adheres to the mission of "leading the car civilization for the benefit of human life" and the
concept of "energy conservation environmental protection scientific and technological intelligence" vigorously develops new
energy and smart cars guides the automobile civilization by the use of scientific and technological innovation and provides
customers with high quality products and services. After years of development the company now owns many famous brands such as
Changan passenger car Oushang automobile Kaicheng automobile Changan Ford Changan Mazda and so on. Up to now the
company has successfully launched a series of classic brands such as CS series Eado series Raeton series Honor and Oushang
series; a series of famous JV products such as all new Focus new Mondeo Kuga Edge Axela CX-5 CX-8 DS7 and so on. At the
same time we have launched new energy vehicles such as Eado EV new Benben EV and CS15EV which are admired by the market
and loved by the consumers.II. Major changes in assets
1. Major changes in assets
No significant changes in major assets during the reporting period
2. Main Overseas Assets
□ Applicable √ Not applicable
III. Core Competence Analysis
Changan builds a research and development system based on the realization of classic products，focusing on breakthroughs in
intelligent technology new energy technologies product experience design etc. Based on the long-term development Changan
continuously invest on research and development. In the first half of 2019 nearly 400 science and technology projects were launched.
As of June 2019 the company has applied for 11611 domestic and foreign patents including 3414 invention patents. Changan is
deepening the “Beidou Tianshu” strategy and building differentiated competitiveness. As the acceleration of the "shangri-la" program
Changan obtained initial results of leading technology. The global R&D center with a total investment of 4.3 billion yuan was
officially put into use and Changan entered the "open sharing global synergy" R&D 4.0 era.New products delivery released on schedule. The new products such as CS85 COUPE new CS15 new CS95 Keshang Eado
ET KaichengF70 CS75 PLUS were put into production on tim. Auchan X7 was released. We first released the first brand of modular
power technology platform of China brand - Blue Whale NE platform fully embraced electrification created a strong power and
opened the Changan Automobile Power 3.0 era. All products are smoothly switched to the sixth national standards.
R&D technology is progressing steadily. APA5.0 automatic parking technology achieves first volume production in the CS75
PLUS. CS75 PLUS debuted at the Shanghai Auto Show "Equipped with BLUECORE 2.0TGDI + Aisin 8AT strongest power
combination" and "BLUECORE 1.5TGDI+ Aisin 6AT classic power combination". L2 level technology continues to spread. CS85
COUPE and CS75 PLUS equipped with a car system developed by the joint venture company "Wu Tong Che Lian" realized mass
production. Changan leads the industry in terms of ecological resources. A new generation of voice interactive system launched in the
new CS95 reaching industry leading level. For the first time the industry realized the demonstration road operation of Xiantao Data
Valley public road. Core technologies such as battery safety and big data platform have achieved initial results. Eado EV520 finished
a comprehensive cruising range of 612 kilometers and won over more than 10 models with absolute advantage in the 6th Qinghai
Lake Electric Vehicle Challenge.Open cooperation and win-win development. "Changan-Huawei Joint Innovation Center" and "Changan-Tencent Joint
Innovation Center" formally unveiled and will develop in-depth cooperation in areas such as intelligence new energy network
security big data new retail and post-market.
Changan Automobile Global R&D Center was officially opened. Under the guidance of "The Third Entrepreneurship –
Innovation and Entrepreneurship Program" Changan continues to deepen its research and development. Integrate global resources to
create an open shared wisdom research and development platform-- Changan Automobile Global R&D Center. The center has a total
investment of 4.3 billion yuan and covers an area of more than 1000 acres. It has 7 functions including design test and management
covering 12 major fields such as simulation analysis noise vibration and collision safety and has more than 180 laboratories
including hybrids air conditioning systems non-metallic materials and the world's leading data centers built with cloud technology.The official opening of the global R&D center marks a key step for Changan Automobile to promote the construction of a smart city
in Chongqing realize the dream of China's automobile power and lead the world's automobile civilization.
Chapter 4 Business Discussion and Analysis
I. Overview
In 2018 the sales volume of the Chinese auto market fell for the first time in 28 years which marks the Chinese auto market has
gradually entered a period of deep adjustment after years of rapid growth，as the market base continues to expand. Zero growth andnegative growth will become the new normal. In the first half of 2019 the auto market continues to be under pressure with great
changes in industrial policies and fierce competition in the industry and negative growth price war new four new competitive
relationship etc. The industry has entered a more brutal knockout. From January to June 2019 the production and sales of the
Chinese auto market continued to fall. The cumulative production and sales reached 12.132 million units and 12.323 million units
respectively declining by 13.7% and 12.4% year-on-year respectively. 10.127 million units of passenger cars were sold declining by
14.0% year-on-year. Among them car sales fell by 12.9% year-on-year and SUV fell by 13.4% year-on-year. Among the new energy
passenger vehicles the production and sales of pure electric passenger vehicles reached 440000 units a year-on-year increase of
69.8% maintaining a high-speed growth momentum. Industry concentration is further improved. The top ten enterprise groups in the
automobile sales totaled 10.997 million units declining 12.1% year-on-year. The decline was slightly smaller than the industry
accounting for 89.2% of the total automobile sales which was 0.3 percentage points higher than the same period of the previous year.(The above data comes from "China Automotive Industry Production and Marketing Newsletter" China Association of Automobile
Manufacturers and its industry information release)
In the first half of 2019 Changan Automobile is guided by the “365ascending action” for quality improvement. With the key to
“deepening reform improving efficiency focusing on marketing and leading quality” the Company deeply implemented "the third
entrepreneurship - innovation and entrepreneurship plan" and solidly promoted the transformation and upgrading of enterprises.
Efforts were made to overcome the adverse effects of large downturns in the economy and negative growth in the industry and we
did our utmost to complete various business objectives. In the first half of the year Changan sold 825000 units ranking the sixth in
China's auto industry. The main results during the reporting period are as follows:
1. Solidly promote the implementation of the strategy and continuously deepen the reform and adjustment
Release the "3rd Entrepreneurship - Innovation and Entrepreneurship Program" version 2.0 and gather full strategic consensus.
Continue to deepen institutional reforms and Auchan light vehicles and other mixed changes are in an orderly manner. Strengthen
institutional innovation propose a new organizational planning direction establish business units such as manufacturing centers
platform development centers and large customer business units and streamline 270 organizations. Strengthen the incentive and
restraint mechanism high-level personnel to strengthen performance linkage and strict assessment and continue to optimize the
matching of people and posts to ensure that personnel are relatively stable. Strongly promote the project and investment mechanism
to encourage value creation.
2. Pay close attention to the improvement of management quality and improve efficiency
In-depth implementation of the quality improvement "365" ascending action with efficiency and efficiency as the core adhere
to the goal orientation optimize resource allocation implement operational quality improvement projects focus on resources to
create classic products optimize product structure reduce costs lean investment projects strictly control inventory and other means
innovative management mechanisms strict management and gradually improve the quality of operations. The 1/2 project is strongly
promoted and business process optimization is continuously promoted and the process efficiency is continuously improved
strengthen data-driven management unify the CA-DDM platform and data guide the improvement of each segment's business
through big data thematic analysis report further enhance operational and service capabilities and to joint ventures.
3. Product lineage is more perfect and technological innovation is remarkable
A variety of new or replacement products such as S85 COUPE new CS95 new CS15 Keshang etc are published on time. The
CS75 PLUS created by the international design team was unveiled at the Shanghai Auto Show and won unanimous praise from the
industry. The Changan Kaicheng F70 designed in conjunction with the French PSA was unveiled for the first time. The brand new
powertrain brand - Blue Whale Power shocked release Chinese automotive industry's first modular engine development platform –
BLUECORE NE medium and small displacement engine platform was born. All products are smoothly switched to the sixth national
standards. Ruichi CC received a 5-star rating with a comprehensive score of 86.9% test and successfully selected as "2019 Safety
Car" for the C-NCAP compact passenger car class.
4. The “Beidou Tianshu” plan continued to deepen and the “Shangri-La” plan accelerated
Deepen the “Beidou Tianshu” plan and continue to build differentiated competitiveness. Realize the industry's first L4 level
autonomous driving in the open road scene in Chongqing Xiantao Data Valley. APA5.0 achieves the first mass production in the
industry on CS75 PLUS and L2 technology continues to be popularized. The cooperation with Tencent has achieved rapid results
CS85 COUPE、CS75 PLUSF equipped with a car system developed by "Wu Tong Che Lian" realized mass production. Changan
leads the industry in terms of ecological resources. A new generation of voice interactive system launched in the new CS95 reaching
industry leading level. The global R&D center costed 4.3 billion was officially put into use marking the official opening of the R&D
4.0 era of “open sharing global synergy”.
Accelerated landing of the "Shangri-La" program technology leadership has begun to show results. Progress has been achieved
in the development of exclusive platforms for new energy vehicles. Core technologies such as big data platform and battery safety
have achieved initial results. New energy products are more abundant CS15EV400 and Eado ET are on the market as scheduled. The
Eado EV520 with a comprehensive life capability of 612 kilometers won the A3 comprehensive champion and 9 individual
champions and media recommendation awards in the 6th Qinghai Lake Electric Vehicle Challenge. The fish-mouth battery and
electric drive system integration plant were officially put into operation and the pace of new energy development was accelerated.
5. Increase marketing efforts steadily improve customer operations
The 100-day marketing attack is remarkable. The sales of Changan passenger brands in May and June increased by the same
period. In the first half of the year the average sales volume of key products CS75 series CS55 series CS35 series and Eado series
reached 10000 units. Changan Ford's retail sales gradually increased from May to June and key products such as Shuangfu Series
Ruijie and Mondeo achieved a significant increase. The channel layout has been continuously improved and have been sunk and the
integration has been promoted in an orderly manner. The customer's operation has been steadily improved and the membership has
grown rapidly. As of June the number of Changan Automobile members exceeded 8.2 million. Build an omni-channel service
system improve the vehicle road rescue management measures and achieve 24-hour service online and enhance customer
experience and satisfaction. Establish a communication mechanism with dealers and suppliers carry out a variety of customer
exchange activities and actively listen to the front line voice. The performance of large customers has been remarkable increasing
customer sourcing promoting the innovative cooperation mode of travel platforms and accelerating the promotion of direct B-side
solutions.
6. Joint ventures face challenges and strategic adjustments continue to deepen
Deepen communication and exchanges and negotiate with the JV partners to develop the Changan Ford Revitalization Plan.
Fully implement the "two leading" strategy of effection and products and the “five major upgrades” strategy of marketing efficiency
quality supply chain and new-field cooperation and promote the rapid improvement of Changan Ford's management quality.
Changan Mazda launched the CX-5 and Angke Sela annual models and the cloud control version boosted sales with 61000 units
sold in the first half of the year. At the same time strengthen high-level interaction and strategic coordination to ensure that Changan
Mazda's operations improved. The reform and innovation of Jiangling Holdings has been basically completed and the follow-up
transformation development path has been clarified.
7. The construction of the ecological circle has been solidly promoted and the emerging business has accelerated
Intensively cooperate with the National Information Center in joint projects special research trend research and research
methods and system construction and promote Changan Automobile's "third entrepreneurship-innovation and entrepreneurship plan
". Deepen strategic cooperation with Huawei and establish the "Changan-Huawei Joint Innovation Center" to carry out in-depth
cooperation in intelligent forward-looking technologies. The T3 travel project was jointly established with FAW and Dongfeng and
Nanjing Leading Technology Co. Ltd. was established and officially put into operation. The “Changan Travel” business continued to
advance with more than 9000 vehicles operating of which the time-sharing business scale has reached the top in Chongqing. The
new marketing business has been promoted in an orderly manner and the core business circle construction mode has been
continuously verified. The brands cover Changan Passenger Auchan Changan Ford and other products of which high-value models
account for more than half of sales.II. Analysis of Main Business
1. Overview
Are they identical with those disclosed in the "I. Overview" in the Chapter of Business Discussion and Analysis?
√ Yes □ No
Please refer to the content of "I. Overview" in the Chapter of Business Discussion and Analysis.
2. Y-o-y changes of main financial data
In RMB Yuan
Current period
Same period of last
year(restated)
Y-o-y
increase/decrease
Reasons for changes
Operating
revenue
29875780096.84 35642832190.04 -16.18%
Operating cost 27419410626.92 30614845704.45 -10.44%
Operating
expenses
1443216541.30 2543462428.51 -43.26%
Mainly due to the decrease in sales volume of
products the reduction in the use of commercial
resources and freight
General and
administrative
expenses
1260364119.97 1048876421.66 20.16%
Financial
expenses
-96832709.15 -225518842.31 57.06%
Mainly due to the decrease in interest income caused
by the decrease in current stock funds
Income tax
expense
116567696.08 15288317.83 662.46%
Mainly due to the decrease in current deferred income
tax assets
R&D expenses 1302956091.53 1106524840.39 17.75%
Subtotal of cash
inflow from
operating
activities
4220263630.95 4401401760.15 -4.12%
Subtotal of cash
inflow from
investment
activities
-3684509162.66 -2973370521.87 -23.92%
Subtotal of cash
inflow from
financing activity
-65487944.32 869502774.20 -107.53%
Mainly due to the decrease in the impact of the
invoicing margin of the acceptance bill
Net increase in
cash and cash
equivalents
499453398.49 2316338311.36 -78.44%
Mainly due to the decrease in cash inflow from
financing activities and investment activities
Major changes on profit composition or profit resources in reporting period
□ Applicable √ Not applicable
3. Composition of Main Business
In RMB Yuan
Operating revenue Operating cost
Gross
profit
Increase or
decrease of
operating
revenue
y-o-y
Increase or
decrease of
operating
cost y-o-y
Increase or decrease
of gross profit y-o-y
According to industries
Automobile
Production
29100899960.18 26869270640.75 7.67% -15.51% -10.95% Down 4.73%
According to products
Vehicles 29039911031.57 26783426523.20 7.77% -15.50% -10.97% Down 4.70%
According to region
China 27640776612.07 25429548405.65 8.00% -16.57% -11.65% Down 5.12%
III. Analysis of non principal business
□ Applicable √ Not applicable
IV. Assets and liability
1. The significant changes of the assets and liability
In RMB Yuan
Item
Current period Same period of last year
Increase/
decrease
(%)
YoY change (%)
Amount
Ratio in
total
assets(%)
Amount
Ratio in
total
assets(%)
Monetary capital 10535284892.55 11.37% 24067745140.49 23.97% -12.60%
Mainly due to the negative net
cash flow from operating
investment and financing
activities at the end of the
same period of the previous
year
Accounts
receivable
2011970761.86 2.17% 1925729920.41 1.92% 0.25%
Inventory 5705376137.26 6.16% 4726421476.59 4.71% 1.45%
Investment
property
7216205.50 0.01% 7442917.06 0.01% 0.00%
Long-term equity
investment
13951703216.21 15.06% 15638035950.97 15.57% -0.51%
Fixed assets 23096697122.71 24.93% 18456584832.13 18.38% 6.55%
Construction in
progress
5178469344.52 5.59% 4728241031.94 4.71% 0.88%
Short-term loan 210000000.00 0.23% 186000000.00 0.19% 0.04%
Long-term loan - 0.00% - 0.00% 0.00%
Transactional
financial assets
1570658462.58 1.70% - 0.00% 1.70%
According to the new
"Accounting Standards for
Business Enterprises No. 22 -
Recognition and Measurement
of Financial Instruments" and
"Accounting Standards for
Business Enterprises No. 37 -
Presentation of Financial
Instruments" the portion of
fair value measurement
previously stated in the
“Available-for-sale financialassets” is reclassified into“Transactional financialassets”.
Available for sale
financial assets
- - 564227000.00 0.56% -0.56%
According to the new
"Accounting Standards for
Business Enterprises No. 22 -
Recognition and Measurement
of Financial Instruments" and
"Accounting Standards for
Business Enterprises No. 37 -
Presentation of Financial
Instruments" it is reclassifiedinto “Investment in otherequity instruments” by the
cost measurement component
and reclassified into“Transactional financialassets” by the fair value
measurement component.Investment in
other equity
instruments
504572800.00 0.54% - - 0.54%
According to the new
"Accounting Standards for
Business Enterprises No. 22 -
Recognition and Measurement
of Financial Instruments" and
"Accounting Standards for
Business Enterprises No. 37 -
Presentation of Financial
Instruments" the portion of
cost measurement previously
stated in the
“Available-for-sale financialassets” is reclassified into“Investment in other equityinstruments”.
2. Assets and liabilities measured by fair value
√ Applicable □ Not applicable
In RMB Yuan
Item
Amount at year
beginning
Comprehensive
income in the
reporting period
Accumulated
fair value
changes
included in
profit or loss
Impairmen
t
provisions
in the
reporting
period
Purchasing
(increasing)
amount in the
reporting period
Selling (reducing)
amount in the
reporting period
Amount at year
end
Financial assets
Transactional financial
assets
40337151.27 1530321311.31 1570658462.58
Other equity investment 504572800.00 504572800.00
Available for sale financial
assets
1530321311.31 1530321311.31 -
Subtotal of financial assets 1530321311.31 - 40337151.27 - 2034894111.31 1530321311.31 2075231262.58
Total 1530321311.31 - 40337151.27 - 2034894111.31 1530321311.31 2075231262.58
Whether the measurement attributes of main assets in the reporting period have significantly changed
√ Yes □ No
After January 1 2019 the company designated part of the equity investment as a financial asset measured at fair value through other
comprehensive income which is reported as other equity instrument investment.
3. Property rights limits by the end of report period
In RMB Yuan
Item
book value at the end of this
year
Limited Reason
Monetary fund 387677879.26 Acceptance bond
Notes receivable 282704275.96 Pledge for issuing bills payable
Intangible assets 18289841.52
Mortgage loans and obtain the amount of commercial
acceptance
Total 688671996.74
V. Analysis of Investment
1. General information
√ Applicable □ Not applicable
External investment
Investment Amount in the report
period(Yuan)
Investment Amount in the same period of last
year(Yuan)
Variance rate
1800000000 2198000000 -18.11%
Particulars of investees
Company Name Principal business Proportion in the investees’ equity (%
Nanjing Leading Equity Investment
Partnership (Limited Partnership)
Equity investment venture capital investment;
investment in non-publicly traded equity of
non-listed companies non-publicly issued
equity of listed companies and related
services. (Projects subject to approval
according to law may be operated after
approval by relevant departments)
16.39%
Chongqing Lianzhi Antou Equity
Investment Partnership (Limited
Partnership)
Equity investment (operating in accordance
with the approved items and deadlines of the
license documents).
50.25%
2. Major equity investment in the reporting period
√ Applicable □ Not applicable
Company name Principal business Investment Investment Share-holding Capital Partner Investment Progress on Any Disclosure Disclosure
mode amount ratio source period book closing
date
litigations date(in
case)
index(in
case)
Nanjing Leading
Equity
Investment
Partnership
(Limited
Partnership)
Equity investment
venture capital
investment;
investment in
non-publicly traded
equity of non-listed
companies
non-publicly issued
equity of listed
companies and
related services.(Projects subject to
approval according
to law may be
operated after
approval by
relevant
departments)
Newly
established
1600000000 16.39%
Its own
capital
Suning Investment
Co. Ltd. China First
Automobile Group
Co. Ltd. Dongfeng
Motor Group Co. Ltd.Shenzhen Tencent
New Travel Limited
Partnership (Limited
Partnership) Shenzhen
Segali Asset
Management Co. Ltd.Hangzhou Alibaba
Venture Capital
Management Co. Ltd.Wuxi Feiye Investment
Co. Ltd. Xianning
Rongyi Smart Travel
Industry Investment
Fund (Limited
Partnership) Nanjing
Hengchuang Yunzhi
Network Technology
Co. Ltd. Nanjing
Leading Equity
Investment
Management Co. Ltd.Indefinite
duration
Establishment
completed
industrial and
commercial
registration
procedures
completed
No 2019-03-22
Announceme
nt of the
Establishmen
t of Nanjing
Leading
Equity
Investment
Partnership
(Limited
Partnership)
(Bulletin No:
2019-16)
Chongqing
Lianzhi Antou
Equity
Investment
Partnership
(Limited
Partnership)
Equity investment
(operating in
accordance with the
approved items and
deadlines of the
license documents).Newly
established
200000000 50.25%
Its own
capital
Jiantou Huake
Investment Co. Ltd.
Beijing Huake Lianzhi
Technology Co. Ltd.
China Construction
Investment
Management (Tianjin)
Co. Ltd.
Indefinite
duration
Establishment
completed
industrial and
commercial
registration
procedures
completed
No 2019-04-30
Announceme
nt of the
Establishmen
t of
Chongqing
Lianzhi
Antou
Equity
Investment
Partnership
(Limited
Partnership)
(Bulletin No:
2019-30)
Total -- -- 2198000000 -- -- -- -- -- -- -- --
3. Major non-equity investment in the reporting period
Please refer to Notes 7 Item 13 “Construction in progress” in the Financial Statement.
4. Investment of Financial Assets
(1)Equity-holdings in financial enterprises
√ Applicable □ Not applicable
Company
name
Company
variety
Initial investment
cost (Yuan)
Opening
equity
Holdings
(share)
Opening
equity
holding
ratio
(%)
Closing
equity
holdings
(share)
Closin
g
equity
Holdin
gs
(%)
Closing book
value (Yuan)
Gain/loss in
the reporting
period (Yuan)
Accounting
title
Equity
source
Southwest
Securities
Securities
Firm
50000000
35500000
0.63%
35500000
0.63% 175370000 51830000
Transactional
financial assets
Initial
investment
Ningde
Times New
Energy
Technology
Co. Ltd.
Electrical
machinery
and
equipment
manufactur
ing
1052930406.36 22999575 1.05% 22999575 1.05% 1395288462.58 -11492848.73
Transactional
financial assets
Initial
investment
(2) Derivative Investments
□ Applicable √ Not applicable
5. Use of raised funds
□ Applicable √ Not applicable
VI. Selling of major assets and major equity
1. Selling of major assets
□ Applicable √ Not applicable
There is no selling of major assets.
2. Selling of Equity
□ Applicable √ Not applicable
There is no selling of major equity.
VII. Analysis of main holding companies and equity companies
√ Applicable □ Not applicable
Basic information of main subsidiary companies and shareholding companies which have an impact on over 10% of net profits
Unit: Ten Thousand Yuan
Name
Registered
capital
Equity
held
Main businesses Total assets
Main
operating
income
Net profit
Changan Mazda Automobile Co. Ltd 11097 USD 50% Produce and sell auto and parts 1354127 757314 87396
Chongqing Changan Suzuki
Automobile Co. Ltd
133764 100% Produce and sell auto and parts 310585 93954 -24576
Jiangling Holding Co. Ltd 100000 50% Produce and sell auto and parts 943398 12075 -47283
Changan Ford Automobile Co. Ltd 24100 USD 50% Produce and sell auto and parts 4176587 1206028 -77689
Subsidiaries acquired and sold in the reporting period
√ Applicable □ Not applicable
During the reporting period Changan newly established Chongqing Chehemei Technology Co. Ltd. It is included in the
consolidated statements in 2019.Name
Acquisition and disposal of subsidiaries
during the reporting period
On the overall production and operation
and performance impact
Chongqing Chehemei Technology Co. Ltd Newly established None
VIII. Structural main business under the company control
□ Applicable √ Not applicable
IX. Forecast for the operating performance of Jan.-Sep. 2019
The accumulated net profit forecast for the beginning of the year to the end of the next reporting period may be a loss or a warning
and explanation of a significant change compared with the same period of the previous year
□ Applicable √ Not applicable
X. Possible risks and coresponding measures
1. Policy and regulatory risks: New energy safety supervision will be further tightened or relevant management rules will be issued
to improve corporate compliance operating costs. The Ministry of Communications will control vehicle logistics violations and
strengthen the notification of violations. It is possible to introduce policies such as “removal mechanism for logistics enterprises”
and the stricter treatment will lead to an increase in the logistics cost of the whole vehicle.
Actions: Adhere to compliance management make pre-plans in advance. Implement cost reduction and efficiency improvement and
strictly control costs.
2. Market competition risk: Since the first negative growth in March 2018 the Chinese auto market has been declining for 15
consecutive months and the auto market has really entered the era of “low growth and negative growth”. The stock competition
situation is still grim. The competition of new products in the industry is fierce and the price reduction promotion is increasingly
frequent. The joint ventures strengthen the layout of the middle and low-end market and the price of joint venture products moves
downwards. The competition of independent brands is fierce and the pace of elimination of enterprises is accelerating.
Actions: In the face of the new competitive situation the company will speed up the upgrading of products and rapidly improve the
overall comprehensive competitiveness. At the same time we will seize the opportunity of national strategic development actively
expand overseas markets and enhance the competitiveness of the international market.
3. Business model risk: With the rapid advancement and development of the “new four” (electricalization interconnection sharing
and intelligentization) of automobiles the huge business opportunities brought about by them have attracted a large influx of various
capitals and carried out on the industry. They disrupted the industry causing disorderly competition in the market and changing the
traditional business model.
Actions: Changan Automobile will seize the strategic opportunity period and realize the transformation from traditional automobile
manufacturing industry to intelligent travel technology company and become an internationally competitive Chinese brand.XI. Interviews and visits in the reporting period
√ Applicable □ Not applicable
Date Manner Object Content discussed and material offered
2019.1.2 On-Site Survey Institution
For details see the January 4 2019 Shenzhen stock exchange interactive
(http://irm.cninfo.com.cn) on the Changan Automobile: January 2 2019 investor
relations activities record sheet
2019.1.10 On-Site Survey Institution
For details see the January 14 2019 Shenzhen stock exchange interactive
(http://irm.cninfo.com.cn) on the Changan Automobile: January 10 2019 investor
relations activities record sheet(1)
2019.1.10 On-Site Survey Institution
For details see the January 14 2019 Shenzhen stock exchange interactive
(http://irm.cninfo.com.cn) on the Changan Automobile: January 10 2019 investor
relations activities record sheet(2)
2019.1.10 On-Site Survey Institution
For details see the January 14 2019 Shenzhen stock exchange interactive
(http://irm.cninfo.com.cn) on the Changan Automobile: January 10 2019 investor
relations activities record sheet(3)
2019.1.11 On-Site Survey Institution
For details see the January 14 2019 Shenzhen stock exchange interactive
(http://irm.cninfo.com.cn) on the Changan Automobile: January 11 2019 investor
relations activities record sheet(1)
2019.1.11 On-Site Survey Institution
For details see the January 14 2019 Shenzhen stock exchange interactive
(http://irm.cninfo.com.cn) on the Changan Automobile: January 11 2019 investor
relations activities record sheet(2)
2019.1.15 On-Site Survey Institution
For details see the January 17 2019 Shenzhen stock exchange interactive
(http://irm.cninfo.com.cn) on the Changan automobile: February 15 2019 investor
relations activities record sheet(1)
2019.1.15 On-Site Survey Institution
For details see the January 18 2019 Shenzhen stock exchange interactive
(http://irm.cninfo.com.cn) on the Changan automobile: February 15 2019 investor
relations activities record sheet(2)
2019.1.16 On-Site Survey Institution
For details see the January 18 2019 Shenzhen stock exchange interactive
(http://irm.cninfo.com.cn) on the Changan Automobile: January 16 2019 investor
relations activities record sheet
2019.1.18 On-Site Survey Institution
For details see the January 22 2019 Shenzhen stock exchange interactive
(http://irm.cninfo.com.cn) on the Changan Automobile: January 18 2019 investor
relations activities record sheet
2019.1.22 On-Site Survey Institution
For details see the January 24 2019 Shenzhen stock exchange interactive
(http://irm.cninfo.com.cn) on the Changan Automobile: January 22 2019 investor
relations activities record sheet(1)
2019.1.22 On-Site Survey Institution
For details see the January 24 2019 Shenzhen stock exchange interactive
(http://irm.cninfo.com.cn) on the Changan Automobile: January 22 2019 investor
relations activities record sheet(2)
2019.2.26 On-Site Survey Institution
For details see the February 27 2019 Shenzhen stock exchange interactive
(http://irm.cninfo.com.cn) on the Changan Automobile: February 26 2019 investor
relations activities record sheet
2019.2.28 On-Site Survey Institution
For details see the March 1 2019 Shenzhen stock exchange interactive
(http://irm.cninfo.com.cn) on the Changan Automobile: February 28 2019 investor
relations activities record sheet
2019.3.5 On-Site Survey Institution
For details see the March 7 2019 Shenzhen stock exchange interactive
(http://irm.cninfo.com.cn) on the Changan Automobile: March 5 2019 investor
relations activities record sheet
2019.3.14 On-Site Survey Institution
For details see the March 18 2019 Shenzhen stock exchange interactive
(http://irm.cninfo.com.cn) on the Changan Automobile: March 14 2019 investor
relations activities record sheet(1)
2019.3.14 On-Site Survey Institution
For details see the March 18 2019 Shenzhen stock exchange interactive
(http://irm.cninfo.com.cn) on the Changan Automobile: March 14 2019 investor
relations activities record sheet(2)
2019.3.19 On-Site Survey Institution
For details see the March 20 2019 Shenzhen stock exchange interactive
(http://irm.cninfo.com.cn) on the Changan Automobile: March 19 2019 investor
relations activities record sheet
2019.3.22 On-Site Survey Institution
For details see the March 25 2019 Shenzhen stock exchange interactive
(http://irm.cninfo.com.cn) on the Changan Automobile: March 22 2019 investor
relations activities record sheet
2019.4.30 On-Site Survey Institution
For details see the May 7 2019 Shenzhen stock exchange interactive
(http://irm.cninfo.com.cn) on the Changan Automobile: April 30 2019 investor
relations activities record sheet
2019.5.6 On-Site Survey Institution
For details see the May 7 2019 Shenzhen stock exchange interactive
(http://irm.cninfo.com.cn) on the Changan Automobile: May 6 2019 investor
relations activities record sheet
2019.5.10 On-Site Survey Institution
For details see the May 13 2019 Shenzhen stock exchange interactive
(http://irm.cninfo.com.cn) on the Changan Automobile: May 10 2019 investor
relations activities record sheet
2019.5.14 On-Site Survey Institution
For details see the May 16 2019 Shenzhen stock exchange interactive
(http://irm.cninfo.com.cn) on the Changan Automobile: May 14 2019 investor
relations activities record sheet
2019.6.12 On-Site Survey Institution
For details see the June 14 2019 Shenzhen stock exchange interactive
(http://irm.cninfo.com.cn) on the Changan Automobile: June 12 2019 investor
relations activities record sheet(1)
2019.6.12 On-Site Survey Institution
For details see the June 14 2019 Shenzhen stock exchange interactive
(http://irm.cninfo.com.cn) on the Changan Automobile: June 12 2019 investor
relations activities record sheet(2)
2019.6.21 On-Site Survey Institution
For details see the June 25 2019 Shenzhen stock exchange interactive
(http://irm.cninfo.com.cn) on the Changan Automobile: June 21 2019 investor
relations activities record sheet
2019.6.28 On-Site Survey Institution
For details see the July 2 2019 Shenzhen stock exchange interactive
(http://irm.cninfo.com.cn) on the Changan Automobile: June 28 2019 investor
relations activities record sheet
Chapter 5 Important Matters
I. Annual shareholders meeting and interim shareholders meeting during the reporting
period
1. Shareholders meeting during the reporting period
Meeting
Session
Type
Investors'
participatio
n ratio
Holding Date Disclosure Date Disclosure Index
2018 Annual
Shareholders
Meeting
Annual 58.387% Jun 27th 2019 Jun 28th 2019
http//www.cninfo.com.cn
2018 Annual Shareholders Meeting Resolution
Announcement(Announcement Number:
2019-45)
2019 The First
Interim
Shareholders
Meeting
Interim 43.615% Jan 3th 2019 Jan 4th 2019
http//www.cninfo.com.cn
2019 The First Interim Shareholders Meeting
Resolution Announcement(Announcement
Number: 2019-02)
2. Preferred shareholders’ request to hold the interim shareholders meeting with restoration of voting
rights
□ Applicable √ Non-applicable
II. Preplan for Company common stock profit distribution and capital reserves converting
into share capital in the reporting period
□ Applicable √ Non-applicable
The company plans not to distribute cash dividends not to send bonus shares not to increase equity by provident fund in the first half
of the year.III. Commitments finished in implementation by the Company shareholders actual
controlleracquirer directors supervisors senior executives or other related parties in
the reporting period and commitments unfinished in implementation at the end of the
reporting period
□ Applicable √ Non-applicable
IV. The appointment and dismissal of accounting firms
Is the semi-annual financial report audited?
□ Yes √ No
V. The board of directors and supervisors explaining the "non standard audit report" from
the accounting firm during the reporting period
□ Applicable √ Not-applicable
VI. The board of directors explaining the "non standard audit report" of last year
□ Applicable √ Not-applicable
VII. Bankruptcy restructuring related matters
□ Applicable √ Not-applicable
During the report period no bankruptcy restructuring related matters occur.
VIII. Crucial litigation events
Crucial litigation and arbitration events
□ Applicable √ Not-applicable
During the report period the company has no crucial litigation or arbitration events.
Other litigation events
□ Applicable √ Not-applicable
IX. Punishment and rectification
□ Applicable √ Not-applicable
During the reporting period there’s no punishment and rectification.
X. The integrity of company and its controlling shareholder actual controller
□ Applicable √ Not-applicable
XI. Company equity incentive plan the implementation of the employee stock ownership plan
or other staff incentives.
√ Applicable □ Not-applicable
At the 50th meeting of the 7th board of directors 《A bill to cancel some stock options of the Company》was deliberated andpassed on Apr 19th 2019 and 9503400 stock options would be cancelled. For details please refer to 《The announcement ofcancellation about some stock options of the company》(Announcement Number: 2019-24) on Apr 23th 2019. On May 15th 2019
the company disclosed 《Notice on the completion of cancellation about some stock options》(Announcement Number: 2019-33)
according to relevant regulations the company applied to the shenzhen branch of China securities registration and settlement co.
LTD for the cancellation of stock options and completed the cancellation procedures.
XII. Significant related party transactions
1. Related transactions related to day-to-day operation
For details please refer to Note 12 "Related Party Relationships and Transactions" in the Financial Statements.
2. Assets or equity acquisition sales related transactions
□ Applicable √ Not-applicable
No related transaction of the acquisition or sale of assets or shares occurred during the reporting period.
3. Related transactions of common investment
□ Applicable √ Not-applicable
During the reporting period the company has no related transactions of common investment
4. Related rights and debt relations
√ Applicable □ Not-applicable
For details please refer to Note 12 "Related Party Relationships and Transactions" in the Financial Statements.
Whether there is any non-business related credits and debts
□ Applicable √ Not-applicable
There is no non-operating associated credits and debts during the reporting period.
5. Other significant related transactions
√ applicable □ not applicable
Related queries in disclosure website of temporary announcement of related transactions
Name of temporary announcements
Temporary
announcement date
Temporary announcement site name
Related transaction announcement thet Chongqing Automobile
Finance Co. Ltd. provides financial services
Feb 1th 2019 http://www.cninfo.com.cn
Related Transactions Announcement that China South Industries
Group Co. Ltd. provides financial service for the company
Feb 1th 2019 http://www.cninfo.com.cn
Announcement about increasing estimated amount of 2019 daily
related transaction
Feb 1th 2019 http://www.cninfo.com.cn
Supplementary announcement about increasing estimated amount
of 2019 daily related transaction
Feb 21th 2019 http://www.cninfo.com.cn
XIII. The non-operating occupation for the capital by the controlling shareholder of the listed
company and its related parties
□ Applicable √ Not-applicable
XIV. Major contract and its performance
1. Trusteeship contracting leasing matters
(1) Trusteeship
□ Applicable √ Not-applicable
Information about Trusteeship
There is no Trusteeship during the reporting period.
(2) Contracting
□ Applicable √ Not-applicable
Information about contracting
There is no contracting during the reporting period.
(3) Leasing
√ Applicable □ Not-applicable
Information about leasing
Related party rental situation can be found in the note 12 of financial statements 4 (3) related party relationships and transactions.Projects whose profit and loss to the company during the reporting period is more than 10% of total profits
□ Applicable √ Not-applicable
Projects whose profit and loss to the company during the reporting period can’t be more than 10% of total profits
2. Major guarantee
□ Applicable √ Not-applicable
There’s no major guarantee during the report period.
3. Other major contract
□ Applicable √ Not-applicable
There’s no other major contract during the reporting period.
Announcement of Related Transactions for Providing Entrusted
Loans to Jiangling Holdings Limited
Apr 23th 2019 http://www.cninfo.com.cn
XV. Social responsibility
1. Significant environmental protection
Whether the listed companies and their subsidiaries belong to the key pollutant discharge units announced by the environmental
protection department
√ Yes □ No
Basic status
Changan Automobile mainly produces engines and automobiles. The main pollutants are chemical oxygen demand ammonia
nitrogen total nickel toluene xylene and non-methane hydrocarbonetc. Waste water mainly comes from the treatment of surface
treatment wastewater spray painting wastewater and oil containing wastewater before the coating workshop which is discharged
after physicochemical and biochemical treatment. The exhaust gas is mainly painted waste gas and flue gas. The exhaust gas of the
spray paint is absorbed concentrated and burned and the exhaust gas of the oven is discharged after burning. Two sulfur oxide and
nitrogen oxide are mainly from the waste gas from the clean energy of natural gas. All of the exhaust gases from energy and natural
gas combustion are organized emissions. The company's headquarters and subsidiaries have a sound environmental management
system which has passed the environmental management system certification.Pollution discharge information
During the reporting period there were 349 pollutant outlets and 22 water pollutant outlets. The emission standards were strictly
implemented according to the national sewage comprehensive discharge standard the water pollutant discharge standard in Beijing
the national standard for the comprehensive emission of air pollutants the standard for the emission of air pollutants on the surface of
automobile manufacturing in Chongqing the standard for the comprehensive emission of air pollutants and the vehicle
Manufacturing industry (painting process) air pollutant emission standard in Beijing national industrial enterprise boundary
environmental noise emission standard and so on. All the pollutants in the company are discharged and there is no excess total
emission.Solid wastes are separately collected and stored. Main dangerous wastes are wastewater and sludge treatment paint slag
phosphated residue and waste solvent etc. The units with hazardous waste business qualification are entrusted to dispose hazardous
wastes. The general industrial solid wastes and household garbage are disposed by the units with qualification according to the
requirement of the local government. The waste electrical and electronic products are disassembled by the units with qualification
and are safely disposed by the units with hazardous waste business qualification.
Construction and operation of pollution prevention facilities
During the reporting period the main waste gas prevention and control facilities include foundry dust removal and
deodorization facilities in engine factories welding dust removal facilities in vehicle factories and treatment facilities for coating
volatile organic waste gas; together with wastewater treatment facilities they are included in preventive maintenance management of
equipment with account books operation instructions preventive maintenance rules preventive maintenance plans and
implementation records and equipment spot inspection records operating records and so on. The facilities are running normally.
Administrative licensing of environmental impact assessment and other environmental protection for construction projects
In accordance with the regulations of the State Council on environmental protection and management of construction projects
the People's Republic of China Environmental Impact Assessment Law the regulations on environmental protection in Chongqing
and the Interim Measures for the construction project completion of environmental protection and acceptance by the Ministry of
environmental protection of the state the environmental impact assessment and completion ring of the new modified and expanded
projects are required and strictly enforce the environmental impact assessment system and the "Three Simultaneity" system. In the
first half of 2019 the Company obtained "Collision Laboratory Phase II Project EIA Approval"and completed the EIA acceptance
about New Energy Phase I Project Electric Drive Project and Automobile Product Structure Adjustment Project.
Emergency preparedness and exercise of emergency environmental events
Continue to carry out environmental protection emergency drills to enhance the response capacity to environmental emergencies.
In the first half of 2019 all bases made environmental risk assessment reports and emergency plans for environmental emergencies.Nanjing Chang'an completed the revision and filing of emergency plans for environmental emergencies. The Company carried out a
company-level drill on chemical leakage.Programming and implementation of self-monitoring of the environment
In the first half of 2019 Key sewage units of Changan Automobile: Yuzui Base of OuShang Automotive Division Jiangbei
Engine Factory Yubei Factory Beijing Changan Hefei Changan. All the key sewage made self-monitoring schemes and
self-monitoring has been carried out and information disclosure has been carried out according to the requirements of the local
ecological environment department.Others
During the reporting period all bases carry out the declaration of national discharge permits in accordance with the
requirements of laws and regulations. Oushang Automobile Business Department Jiangbei Engine Factory and Yubei Factory carried
out the 2018 Environmental Credit Evaluation.
2. Fulfill social responsibility of targeted poverty alleviation
√ Applicable □ Not applicable
In the first half of 2019 Chang'an Automobile actively responded to the Guiding Opinions of the Central Committee of the
Communist Party of China and the State Council on the Three-Year Action to Win the Strong Fight against Poverty comprehensively
implemented the spirit of the Nineteenth National Congress of the CPC and the Central Conference on Poverty Alleviation and
Development and effectively promoted the precise poverty alleviation and public welfare in accordance with the decision-making
and deployment work of the central party committee and the central government and strived to promote better and faster economic
and social development in poor areas.
（1）In the first half of 2019 precise poverty alleviation in "two counties" of Yunnan
The company donated RMB 9 million to Luxi County.On education poverty alleviation projects: invest 1.5 million yuan on the renovation project of dangerous buildings in Alou
Primary School of Yongning Village Committee to improve the school infrastructure and provide a safe learning environment for the
school students.On poverty alleviation projects for people's livelihood: invest 4.7 million yuan to improve the living environment through the
support rural domestic waste collection and transportation facilities project for the disposal of garbage trucks and stainless steel trash
cans (hanging barrels) on demand in Luxi County
On the industrial poverty alleviation project: invest 2.8 million yuan to support the construction project of factory nursery
base in Jinma
The company donated RMB 9 million to Yanshan County.On education poverty alleviation projects: invest 0.3 million yuan on the 980 square metre student complex building of
Dageda hope primary school to solve the problem of teaching rooms for school students in grades 1-3 and kindergartens; invest 2
million yuan on the 960 square metre new comprehensive building and 120 square metre latrines and ancillary engineering projects
of the Biyun hope primary school.On poverty alleviation projects for people's livelihood: donate 2.89 million yuan to 9 townships for the purchase of the
garbage collection vehicles; donate 3.81 million yuan on the project of garbage collection bins (boxes) to purchase domestic garbage
collection boxes in 11 townships.
（2）Fixed Poverty Alleviation Program in Jishui County Jiangxi Province in the first half of 2019
The company donated RMB 2 million to to Jishui County.On the health poverty alleviation project: support the health express project and invest 2 million yuan to purchase medical
ambulances for Jishui County.
（3）Fixed Poverty Alleviation Programs in Pengshui and Youyang Counties of Chongqing in the first half of 2019
According to the "Notice of the Chongqing Municipal Development and Reform Commission's Leading Group for Poverty
Alleviation on Carrying out Donation Assistance and Reporting Poverty Alleviation Materials"( Yu Development and Reform
Commission of the Poverty Alleviation Group issued [2019] Document No. 1) Changan Automobile donated 300000 yuan to
Pengshui County for poverty alleviation.In accordance with the spirit of the Notice of the Office of the People's Government of Jiangbei District of Chongqing on the
Work Plan of Aiding Youyang County in 2019 (No. 5 of Jiangbei Prefecture Office) Changan Automobile donated 200000 yuan to
Youyang County for the"Golden Plum" planting project in Changsha Village of Lixi Town.
Changan Automobile Statistics on Poverty Alleviation in the first half of 2019
Indicator Unit Quantity / Details
Ⅰ. Total —— ——
1.funds 10 thousand RMB 2050
2. Material 10 thousand RMB ——
Ⅱ. Subdivision —— ——
1. Industrial poverty alleviation —— 300
1.1 Industrial poverty alleviation project type ——
1) Construction Project of Factory Seedling
Raising Base in Jinma Town Luxi；280
2) "Golden Plum" Planting Project in Changsha
Village Lixi Town Youyang; 20.
2. Education poverty alleviation —— 380
2.1 Funding for poor students 10 thousand RMB
1) Renovation project of dangerous buildings in
Alou Primary School of Yongning Village
Committee in Luxi County; 150.
2) Dageda Hope Primary School Project in
Yanshan county; 289
3) Biyun Hope Primary School Project in
Yanshan county; 200
3. Medical and health poverty alleviation —— 200
3.1 Medical and health resources invested in poverty areas 10 thousand RMB
Jishui County Health Express (Medical
Ambulance) Project; 200
4. Other projects - people's livelihood poverty alleviation —— 1170
4.1 Amount of investment 10 thousand RMB
Luxi Waste Collection and Transportation
Facility Project; 470
Yanshan Garbage Collection Vehicle Purchase
and Construction Project; 289
Inkshan Garbage Collection Tank Purchase
（4）Follow-up precision poverty alleviation plan
According to the "Notice on Requesting Further Enhancement of Assistance to Mengxiang Automobile Training Base of
Fuping Vocational Education Center" by the Office of the Poverty Alleviation Working Group of the State Administration of Organs
Affairs the Company will carry out the poverty alleviation work in Fuping County Hebei Province in the second half of 2019
mainly for upgrading the Mengxiang Automobile Training Base of Fuping Vocational and Technical Education Center to the regional
comprehensive high-level automobile and intelligent manufacturing production and education integration training base construction
project. The Company plans to donate the vehicles spare parts machinery and equipment including 38 vehicles 77 spare parts (2
categories and 8 kinds of materials) and 30 machines and equipment.XVI. Other important matters
□ Applicable √ Not-applicable
XVII. Important matters of company subsidiaries
□ Applicable √ Not-applicable
Construction Project; 381
Pengshui County; 30
Chapter 6 Changes in the shareholding of the company and
shareholders
I. Change in shareholdings
1. Change in shareholdings
Unit: one share
Balance before current
change
Addition and deduction(+，-) during change
Balance after current
change
Quantity
Ratio
(%)
Additional
issued
Stock
dividend
Provident
fund
transfer
other Quantity
Ratio
(%)
Quantity
Non-circulated shares 139781303 2.91% 139781303 2.91%
1. State-owned legal
person shares
139762403 2.91% 139762403 2.91%
2. Senior management
personnel shares
18900 0.00% 18900 0.00%
Circulated shares 4662867208 97.09% 4662867208 97.09%
1. Domestic listed
RMB shares
3760881066 78.31% 3760881066 78.31%
2. Domestic listed
foreign shares
901986142 18.78% 901986142 18.78%
Total shares 4802648511 100.00% 4802648511 100.00%
Reason of stock changes
□ Applicable √ Not-applicable
Approval of stock changes
□ Applicable √ Not-applicable
Ownership transfer of stock change
□ Applicable √ Not-applicable
Progress of Share Repurchase
□ Applicable √ Not-applicable
Implementation Progress of Reducing Holdings of Repurchase Shares by Centralized Bidding
□ Applicable √ Not-applicable
The influence of share changes on financial indicators such as the latest year and the latest basic earnings per share and
diluted earnings per share the net assets per share belonging to the common shareholder of the company
□ Applicable √ Not-applicable
Other contents which the company regards necessary and securities supervising institution requires the Company to disclose
□ Applicable √ Not-applicable
2. Change in Non-circulated shares
√ Available □ Not-available
Unit: one share
Name of
shareholders
Non-circulated
shares held at the
year-beginning
Decrease during the
reporting period
Increase during the
reporting period
Non-circulated
shares held at the
year-end
Reason for non-circulated
shares
Date for the
circulated shares
China Changan
Automobile Co.
Ltd.
139762403 - - 139762403
Non-public offering
shares of 139762403
in 2016
2019-10-14
Zhu Huarong 18900 - - 18900 Executive lock stocks
6 months after
the retirement
Total 139781303 - - 139781303 -- --
II. Issuing and listing of securities
□ Applicable √ Not-applicable
III. Shareholding and shareholders of the company
Unit: one share
At the end of the report period the total number of
shareholders
180066
Number of preferred
shareholders with
resumed voting rights
at the period-end
0
Holding more than 5% of the shareholders or top 10 shareholders situation
Name of shareholders
Nature of
Shareholders
Percentage
of total
shares
(%)
Shares held at
the year-end
Increases and
decreases
during the
report period
Non-circulat
ed shares
held at the
year-end
Circulated
shares held at
the year-end
Pledged/ Frozen
cases
Share
status
amount
China South Industries
Group Co. Ltd.State-owned legal
person shares
21.56% 1035312673 - - -
No pledge
or freeze
China Changan
Automobile Co. Ltd.
State-owned legal
person shares
19.32% 928044946 - 139762403 788282543
No pledge
or freeze
China securities
finance Co Ltd
domestic general
legal person
shares
4.88% 234265333 - - -
No pledge
or freeze
United Prosperity
Investment Co.Limited
foreign legal
person shares
3.21% 154120237 - - -
No pledge
or freeze
Central Huijin
Investment Ltd.domestic general
legal person
shares
1.15% 55393100 - - -
No pledge
or freeze
DRAGON BILLION
SELECT MASTER
FUND
foreign legal
person shares
0.85% 40597114 - - -
No pledge
or freeze
GIC PRIVATE
LIMITED
foreign legal
person shares
0.73% 35283393 -9519830 - -
No pledge
or freeze
Hong Kong Central
Settlement Co. Ltd.foreign legal
person shares.
0.73% 34925042 11276995 - -
No pledge
or freeze
National Social
Security Fund 107
Portfolio
fund finance
products etc.
0.57% 27581041 27581041 - -
No pledge
or freeze
China Life Insurance
Co. Ltd. - Dividend -
Individual Dividend -
005L - FH002 Deep
fund finance
products etc.
0.57% 27309067 27309067 - -
No pledge
or freeze
Explanation on the relationship and the
action alike of above shareholders
Among the top 10 shareholders China South Industries Group Co. Ltd. the actual controller; China Changan
Automobile Group Co. Ltd. the controlling shareholder and its wholly owned subsidiary United Prosperity(Hong Kong) Investment Co. Limited. belong to the concerted actor regulated by “Disclosure Administrationof Shares Change Information of The Listed Company”.The ten largest circulated shareholders
Name of shareholders Shares at the year end
Shares type
Type Amount
China South Industries Group Co. Ltd. 1035312673 RMB ordinary shares 1035312673
China Changan Automobile Co. Ltd. 788282543 RMB ordinary shares 788282543
China securities finance Co Ltd 234265333 RMB ordinary shares 234265333
United Prosperity Investment Co. Limited 154120237
Domestic listed foreign
shares
154120237
Central Huijin Investment Ltd. 55393100 RMB ordinary shares 55393100
DRAGON BILLION SELECT MASTER FUND 40597114
Domestic listed foreign
shares
40597114
GIC PRIVATE LIMITED 35283393
Domestic listed foreign
shares
35283393
Hong Kong Central Settlement Co. Ltd. 34925042 RMB ordinary shares 34925042
National Social Security Fund 107 Portfolio 27581041 RMB ordinary shares 27581041
China Life Insurance Co. Ltd. - Dividend - Individual
Dividend - 005L - FH002 Deep
27309067 RMB ordinary shares 27309067
The top 10 shareholders to sell circulated shares and the
infinite tradable relationship between shareholders and
top 10 shareholders or concerted action
Among the top 10 shareholders China South Industries Group Co. Ltd. the actual
controller; China Changan Automobile Group Co. Ltd. the controlling shareholder and
its wholly owned subsidiary United Prosperity (Hong Kong)Investment Co. Limitedbelong to the concerted actor regulated by “Disclosure Administration of Shares ChangeInformation of The Listed Company”.Whether the company top 10 shareholders of ordinary shares and the top 10 circulated shareholders agreed on the repurchase
transactions during the report period
□ Available √ Not- available
The company top 10 shareholders of ordinary shares and the top 10 circulated shareholders did not agree on the repurchase
transactions during the reporting period
IV. The change of the controlling shareholders and theactual controllers
During the reporting period the change of controlling shareholders
□ Available √ Not- available
No changes in controlling shareholders during the reporting period.The change of the actual controllers during the reporting period
□ Available √ Not- available
No changes in the actual controllers during the reporting period.
Chapter 7 Information about Directors Supervisors Senior
Management
I. Share ownership of directors supervisors and senior managers
□ Available √ Not- available
The share ownership of the directors supervisors and senior managers has no change during the reporting period. For details plaese
refer to 2018 annual report.II. Departure and Hiring information of the directors supervisors and senior manager
Name Duties Type Date Reason
Yan Ming Supervisory board chairman Election Jan 3th 2019 Appointment due to work
Zhang Anguo Supervisor Departure Jun 12th 2019
Reached the statutory retirement
age
Chapter 8 Corporate Bonds
Is there a corporate bond that is publicly issued and listed on the stock exchange and fails to be fully paid
up or not due on maturity until the approval of the semi-annual report
□ Yes √ No
Chapter 9 The Financial Statements
I. Auditing Report
Semi-annual report is audited
□ Yes √ No
No audit on the semi-annual financial report.II. Financial statement ment
Financial in notes to the statements of the unit is: RMB yuan
1. Consolidated Balance Sheet
In RMB Yuan
Account Ending Balance Opening Balance
Current assets:
Cash 10535284892.55 9980544526.14
Transactional financial assets 1570658462.58 -
Notes receivable 15646668140.73 20561625805.24
Accounts receivable 2011970761.86 1409419600.50
Prepayments 1037445041.94 866249749.51
Other receivables 3508904992.23 3250452923.70
Interest receivable 4581253.52 17432805.54
Dividend receivable 74897909.69 -
Inventories 5705376137.26 4917420457.19
Other current assets 2386633331.39 2227565353.23
Total current assets 42402941760.54 43213278415.51
Non-current assets:
Available-for-sale financial assets - 1957873311.31
Long-term receivables 13951703216.21 13275170118.83
Other equity investment 504572800.00 -
Investment properties 7216205.50 7329561.28
Fixed assets 23096697122.71 22161054058.31
Construction in progress 5178469344.52 5383844030.75
Intangible assets 5157430063.87 5018243552.80
Devlopment expenditure 760182010.40 789597615.60
Goodwill 9804394.00 9804394.00
Long-term deferred expenses 16237755.41 17104601.67
Deferred tax assets 1563728004.61 1655554438.89
Other non-current assets - -
Total non-current assets 50246040917.23 50275575683.44
Total assets 92648982677.77 93488854098.95
Current liabilities:
Short-term loans 210000000.00 190000000.00
Notes payable 13769475508.94 14807862262.39
Accounts payable 14276660036.85 13916201276.95
Advances from customers 2956683361.56 1556482278.92
Payroll payable 718633011.49 1362995277.56
Taxes payable 291143424.37 669316487.25
Other payables 5165398262.95 3079749015.81
Interest payables - -
Dividend payables 86527416.00 79742.80
Non-current liabilities due within one
year
- 6594120.00
Other current liabilities 3496651739.73 4325441152.61
Total current liabilities 40884645345.89 39914641871.49
Non-current liabilities:
Long-term loans - -
Long-term payable 305774538.84 303590824.69
Long term payroll payable 50169379.85 53837000.00
Estimated liabilities 3592278128.96 3245322744.12
Deferred earnings 3811225620.05 3683308534.73
Deferred tax liabilities 128477234.19 135231170.59
Total non-current liabilities 7887924901.89 7421290274.13
Total liabilities 48772570247.78 47335932145.62
Owners’ equity:
Share capital 4802648511.00 4802648511.00
Capital reserves 5057242440.17 5057242440.17
Other Comprehensive Income 258077778.57 235509930.44
Special reserves 72654099.18 41222369.10
Surplus reserves 2401324255.50 2401324255.50
Retained earnings 31380523736.00 33707011170.31
Equity attributable to owners 43972470820.42 46244958676.52
Minority interests -96058390.43 -92036723.19
Total equity 43876412429.99 46152921953.33
Total liabilities and owener’s equity 92648982677.77 93488854098.95
2. Balance sheet
In RMB Yuan
Account Ending Balance Opening Balance
Current assets:
Cash 6698422103.34 7310973018.99
Transactional financial assets 175370000.00 -
Notes receivable 14161450629.65 19391160283.70
Accounts receivable 6945459716.89 5679160679.69
Prepayments 898186001.89 671849711.04
Other receivables 2500415415.10 2344318158.83
Interest receivable - 17432805.54
Dividend receivable - -
Inventories 4621978826.11 3851783233.12
Other current assets 1464380012.55 1355155749.21
Total current assets 37465662705.53 40604400834.58
Non-current assets:
Available-for-sale financial assets 541182000.00
Long-term equity investments 19034465670.17 18017137600.72
Other equity investment 494662800.00 -
Investment properties - -
Fixed assets 17810903333.74 16795537563.35
Construction in progress 4015173896.05 4114409774.13
Intangible assets 3925681021.92 4054893372.88
Development expenditure 621830546.25 559309970.45
Goodwill - -
Long-term deferred expenses 11563878.39 12555353.69
Deferred tax assets 1441043727.65 1533057523.95
Other non-current assets - 250000000.00
Total non-current assets 47355324874.17 45878083159.17
Total assets 84820987579.70 86482483993.75
Current liabilities:
Short-term loans - -
Notes payable 12199985904.83 13572757870.72
Accounts payable 11427979197.45 10690985635.15
Advances from customers 2683222204.98 1208631011.05
Payroll payable 402607121.40 1001765362.99
Taxes payable 218034971.63 604525457.30
Other payables 3839324170.55 3219909047.22
Interest payables - -
Dividend payables 86447673.20 -
Non-current liabilities within one year - -
Other current liabilities 3082258825.11 3923419042.37
Total current liabilities 33853412395.95 34221993426.80
Non-current liabilities:
Long-term loans - -
Long-term payable 236869351.54 248240115.29
Long term payroll payable 20933120.15 24315000.00
Estimated liabilities 2498529264.52 2372512543.49
Deferred earnings 2864067397.18 2827208446.74
Deferred tax liabilities 34458242.04 26683742.04
Total non-current liabilities 5654857375.43 5498959847.56
Total liabilities 39508269771.38 39720953274.36
Owners' equity:
Share capital 4802648511.00 4802648511.00
Capital reserves 4705917638.38 4705917638.38
Other comprehensive income 149525803.58 149525803.58
Special reserves 25951495.71 19835367.61
Surplus reserves 2401324255.50 2401324255.50
Retained earnings 33227350104.15 34682279143.32
Total owners' equity 45312717808.32 46761530719.39
Total liabilities and owners’ equity 84820987579.70 86482483993.75
3. Consolidated Income Statement
In RMB Yuan
Account Current Period Prior Period
1.Total operating revenue 29875780096.84 35642832190.04
Operating revenue 29875780096.84 35642832190.04
2.Total operating costs 32409385145.35 36375105754.27
Operating cost 27419410626.92 30614845704.45
Tax and surcharges 1080270474.78 1286915201.57
Operating expenses 1443216541.30 2543462428.51
General and administrative expenses 1260364119.97 1048876421.66
Research and development expenses 1302956091.53 1106524840.39
Financial expenses -96832709.15 -225518842.31
Interest expense 28216059.24 13996367.31
Interest income 128484820.10 263722875.78
Add: Other income 620733074.11 1116231219.32
Investment income -108336709.94 1362011815.11
Including: Investment income from
associates and joint venture
-108336709.94 1362011815.11
Exchange gains
Gains from changes in fair value 40337151.27 -
Credit impairment loss -9529733.66 -
Asset impairment loss -152676538.06 -108941422.42
Gain on disposal of assets 9392459.28 18771809.69
3.Operating profit -2133685345.51 1655799857.47
Add: Non-operating income 18836680.44 29318896.76
Less: Non-operating expenses 12645067.20 52348762.93
4.Total profit -2127493732.27 1632769991.30
Less: Income tax expense 116567696.08 15288317.83
5.Net profit -2244061428.35 1617481673.47
Classification by going concern
Net profit from continuing operations -2244061428.35 1617481673.47
Net profit from discontinued operations
Classification by ownership attribution
Net profit attributable to owners -2240039761.11 1609606578.84
Minority interests -4021667.24 7875094.63
6.Other comprehensive income net of tax 22567848.13 247029533.59
Net after-tax net of other
comprehensive income attributable to the
parent company owner
22567848.13 247029533.59
Other comprehensive income that
will be reclassified into profit or loss
22567848.13 247029533.59
Other comprehensive income
of convertible gains and losses under the
equity method
- 289756488.89
Gains and losses from
changes in fair value of available-for-sale
financial assets
- -23536500.00
Foreign currency financial
statement translation difference
22567848.13 -19190455.30
7.Total comprehensive income -2221493580.22 1864511207.06
Total comprehensive income
attributable to owners
-2217471912.98 1856636112.43
Total comprehensive income
attributable to minority interest
-4021667.24 7875094.63
8.Earnings per share
Basic earnings per share -0.47 0.34
Diluted earnings per share -0.47 0.34
4. Income Statement
In RMB Yuan
Account Current Period Prior Perid
1.Operating revenue 26805108322.22 34209065716.02
Less: Operating cost 24637906770.95 29726487573.72
Tax and surcharges 855166897.03 1092437739.80
Operating expenses 902216576.48 2298436366.37
General and administrative expenses 670820794.55 715915096.88
Research and development expenses 1347276655.86 1088618476.49
Financial expenses -88753361.46 -248434734.69
Interest expense 14997114.41 -
Interest income 109584194.58 256209477.45
Add: Other income 406839978.09 761820507.26
Investment income -73898822.33 1995138886.45
Including: Investment income from
associates and joint venture
-78048193.41 1362011815.11
Exchange gains
Gains from changes in fair value 51830000.00
Credit impairment loss -4381254.25
Asset impairment loss -141818001.51 -114014999.44
Gain on disposal of assets 6747426.61 23972983.02
2.Operating profit -1274206684.58 2202522574.74
Add: Non-operating income 14232341.29 22601200.00
Less: Non-operating expenses 8718726.38 44712292.46
3.Total profit -1268693069.67 2180411482.28
Less: Income tax expense 99788296.30 -31839831.42
4.Net profit -1368481365.97 2212251313.70
Net profit from continuing operations -1368481365.97 2212251313.70
Net profit from discontinued operations
5.Other comprehensive income net of tax - 266219988.89
Other comprehensive income that
will be reclassified into profit or loss
- 266219988.89
Other comprehensive income
of convertible gains and losses under the
equity method
- 289756488.89
Gains and losses from
changes in fair value of available-for-sale
financial assets
- -23536500.00
6.Total comprehensive income -1368481365.97 2478471302.59
7.Earnings per share
Basic earnings per share -0.28 0.46
Diluted earnings per share -0.28 0.46
5. Consolidated cash flow statement
In RMB Yuan
Account Current Period Prior Perid
1.Cash flows from operating activities:
Cash received from sale of goods
or rendering of services
37501789702.13 47598885985.36
Refunds of taxes 305232064.00 196358525.83
Cash received relating to other
operating activities
3464749370.24 1720885871.60
Subtotal of cash inflows 41271771136.37 49516130382.79
Cash paid for goods and services 29029097098.22 36479347621.36
Cash paid to and on behalf of
employees
2984764831.32 3423077482.78
Cash paid for all types of taxes 1743016544.47 1795067722.02
Cash paid relating to other
operating activities
3294629031.41 3417235796.48
Subtotal of cash outflows 37051507505.42 45114728622.64
Net cash flows from operating activities 4220263630.95 4401401760.15
2.Cashflows from investing activities:
Cash received from investment
income
- 114500000.00
Net cash received from disposal of
fixed assets intangible assets and other
long-term assets
5214056.34 18444059.30
Cash received relating to other
investing activities
1478695.29 17358750.00
Subtotal of cash inflows 6692751.63 150302809.30
Cash paid for acquisition of fixed
assets intangible assets and other
long-term assets
2438475206.69 3071429581.17
Cash paid for acquisition of
investments
936788517.00 52243750.00
Cash paid relating to other
investing activities
315938190.60 -
Subtotal of cash outflows 3691201914.29 3123673331.17
Net cash flows from investing activities -3684509162.66 -2973370521.87
3.Cash flows from financing activities:
Cash received from borrowings 41000000.00 166000000.00
Cash received relating to other 37159887.74 880129667.40
financing activities
Subtotal of cash inflows 78159887.74 1046129667.40
Cash repayments of borrowings 27708100.00 171300000.00
Cash paid for distribution of
dividends or profits and interest
expenses
23367744.44 5326893.20
Cash paid relating to other
financing activities
92571987.62 -
Subtotal of cash outflows 143647832.06 176626893.20
Net cash flows from financing activities -65487944.32 869502774.20
4.Effect of changes in exchange rate on
cash
29186874.52 18804298.88
5.Net increase in cash and cash
equivalents
499453398.49 2316338311.36
Add: Opening balance of cash and cash
equivalents
9648153614.80 21451305090.53
6.Closing balance of cash and cash
equivalents
10147607013.29 23767643401.89
6. Cash flow statement
In RMB Yuan
Account Current Period Prior Perid
1.Cash flows from operating activities:
Cash received from sale of goods
or rendering of services
34665878858.45 45723211451.95
Refunds of taxes - -
Cash received relating to other
operating activities
2199853209.77 1227875965.34
Subtotal of cash inflows 36865732068.22 46951087417.29
Cash paid for goods and services 26688730896.99 34485733663.71
Cash paid to and on behalf of
employees
2093118245.08 2753479395.91
Cash paid for all types of taxes 1228855624.27 1308603097.31
Cash paid relating to other
operating activities
3878425262.91 3359852336.20
Subtotal of cash outflows 33889130029.25 41907668493.13
Net cash flows from operating activities 2976602038.97 5043418924.16
2.Cashflows from investing activities:
Cash received from return on
investments
- 839201.56
Cash received from investment
income
4398333.33 119200416.67
Net cash received from disposal of
fixed assets intangible assets and other
long-term assets
- 18417859.30
Cash received relating to other
investing activities
- 100000000.00
Subtotal of cash inflows 4398333.33 238457477.53
Cash paid for acquisition of fixed
assets intangible assets and other
long-term assets
2281259200.99 2869658085.59
Cash paid for acquisition of
investments
997294972.55 157000000.00
Cash paid relating to other
investing activities
300000000.00 200000000.00
Subtotal of cash outflows 3578554173.54 3226658085.59
Net cash flows from investing activities -3574155840.21 -2988200608.06
3.Cash flows from financing activities:
Cash received from borrowings - -
Cash received relating to other
financing activities
- 461856503.42
Subtotal of cash inflows - 461856503.42
Cash repayments of borrowings - -
Cash paid for distribution of
dividends or profits and interest
expenses
14997114.41 -
Cash paid relating to other
financing activities
- -
Subtotal of cash outflows 14997114.41 -
Net cash flows from financing activities -14997114.41 461856503.42
4.Effect of changes in exchange rate on
cash
- -
5.Net increase in cash and cash -612550915.65 2517074819.52
equivalents
Add: Opening balance of cash and cash
equivalents
7310973018.99 20172657984.53
6.Closing balance of cash and cash
equivalents
6698422103.34 22689732804.05
7. Consolidated statement of changes in shareholders’ equity
In RMB Yuan
Items
Current period
Equity attributable to owners
Minority interest Total equity
Share capital Capital reserves
Less:
Treasury
shares
Special
reserves
Surplus reserves
General
reserves
Retained earnings
Other
comprehensive
income
I. At end of last year 4802648511.00 5057242440.17 - 41222369.10 2401324255.50 33707011170.31 235509930.44 -92036723.19 46152921953.33
II. At beginning of year 4802648511.00 5057242440.17 - 41222369.10 2401324255.50 33707011170.31 235509930.44 -92036723.19 46152921953.33
III. Changes during the year - - - 31431730.08 - -2326487434.31 22567848.13 -4021667.24 -2276509523.34
1.Total comprehensive
income
-2240039761.11 22567848.13 -4021667.24 -2221493580.22
2. Capital contributed by
owners and capital decreases
-
3. Distribution of profit -86447673.20 -86447673.20
Distribution to owners -86447673.20 -86447673.20
4. Special reserves 31431730.08 31431730.08
(1) Pick-up in current
period
36229412.78 36229412.78
(2) Used in current period -4797682.70 -4797682.70
IV. At end of current period 4802648511.00 5057242440.17 - 72654099.18 2401324255.50 - 31380523736.00 258077778.57 -96058390.43 43876412429.99
Prior period
In RMB Yuan
Items
Prior period
Equity attributable to owners
Minority interest Total equity
Share capital Capital reserves
Less:
Treasury
shares
Special
reserves
Surplus reserves
General
reserves
Retained earnings
Other
comprehensive
income
I. At end of last year 4802648511.00 5099405956.94 - 28279733.06 2401324255.50 - 35184073061.94 82959423.84 -135511683.82 47463179258.46
II. At beginning of year 4802648511.00 5099405956.94 - 28279733.06 2401324255.50 - 35184073061.94 82959423.84 -135511683.82 47463179258.46
III. Changes during the year - - - 17709058.85 - - -548183704.82 247029533.59 7875094.63 -275570017.75
1.Total comprehensive
income
- - - - - - 1609606578.84 247029533.59 7875094.63 1864511207.06
2. Capital contributed by
owners and capital decreases
3. Distribution of profit - - - - - -- -2157790283.66 - - -2157790283.66
Distribution to owners - - - - - - -2157790283.66 - - -2157790283.66
4. Special reserves - - - 17709058.85 - - - - - 17709058.85
(1) Pick-up in current
period
- - - 40997574.06 - - - - - 40997574.06
(2) Used in current period - - - -23288515.21 - - - - - -23288515.21
IV. At end of current period 4802648511.00 5099405956.94 - 45988791.91 2401324255.50 - 34635889357.12 329988957.43 -127636589.19 47187609240.71
8. Statement of changes in shareholders’ equity
In RMB Yuan
Items
Current period
Share capital Capital reserves
Less:
Treasury
shares
Special
reserves
Surplus reserves Retained earnings
Other
comprehensive
income
Total equity
I. At end of last year 4802648511.00 4705917638.38 19835367.61 2401324255.50 34682279143.32 149525803.58 46761530719.39
II. At beginning of year 4802648511.00 4705917638.38 - 19835367.61 2401324255.50 34682279143.32 149525803.58 46761530719.39
III. Changes during the year - - - 6116128.10 - -1454929039.17 - -1448812911.07
1.Total comprehensive income -1368481365.97 - -1368481365.97
2. Capital contributed by owners and
capital decreases
-
The amount of shares paid into the owner's
equity
3. Distribution of profit -86447673.20 -86447673.20
Distribution to owners -86447673.20 -86447673.20
4. Special reserves 6116128.10 6116128.10
(1) Pick-up in current period 23037668.82 23037668.82
(2) Used in current period -16921540.72 -16921540.72
IV. At end of current period 4802648511.00 4705917638.38 - 25951495.71 2401324255.50 33227350104.15 149525803.58 45312717808.32
Prior period
In RMB Yuan
Items
Prior period
Share capital Capital reserves
Less:
Treasury
shares
Special
reserves
Surplus reserves Retained earnings
Other
comprehensive
income
Total equity
I. At end of last year 4802648511.00 4717192101.72 - 12013706.73 2401324255.50 36640962334.05 132520410.88 48706661319.88
II. At beginning of year 4802648511.00 4717192101.72 - 12013706.73 2401324255.50 36640962334.05 132520410.88 48706661319.88
III. Changes during the year - - - 10769602.18 - 54461030.04 266219988.89 331450621.11
1.Total comprehensive income - - - - - 2212251313.70 266219988.89 2478471302.59
2. Capital contributed by owners and
capital decreases
The amount of shares paid into the owner's
equity
3. Distribution of profit - - - - - -2157790283.66 - -2157790283.66
Distribution to owners - - - - - -2157790283.66 - -2157790283.66
4. Special reserves - - - 10769602.18 - - - 10769602.18
(1) Pick-up in current period - - - 28985079.84 - - - 28985079.84
(2) Used in current period - - - -18215477.66 - - - -18215477.66
IV. At end of current period 4802648511.00 4717192101.72 - 22783308.91 2401324255.50 36695423364.09 398740399.77 49038111940.99
III. CORPORATE INFORMATION
Chongqing Changan Automobile Company Limited (hereafter referred to as the “Company”) was established by China Changan
Automobile Group (hereafter referred to as the “Changan Group”) as the individual originator on 31 October 1996. The company
was set up using the group’s net asset relating to the operation of mini cars and engine the shares it owned in Chongqing Changan
Suzuki company limited (equal to 506190000 shares of the Company) and the fund raised from the issuance of 250000000 foreign
capital stock (B shares) with total share capital of RMB756190000.With the approval of China Securities Regulatory Commission the company initially floated on share market on 19 May 1997 by
issuing 120000000 common shares (A share) to the public. The offering increased the total share capital to RMB 876190000.
On 26 June 1998 the Company issued 4 shares for each 10 shares to existing shareholders of the original 876190000 shares. The
issuance was made from capital reserve and increased the total share capital to RMB 1226666000.
On 26 May 2004 the Company offered 2 bonus shares for each 10 shares held by existing shareholders which increased the total
share capital from RMB 1226666000 to RMB 1471999200.
On 26 August 2004 with the approval of China Securities Regulatory Commission the Company offered 148850000 common
shares (A share) to the market which increased the total share capital to RMB 1620849200.
In December 2005 China South Industries Group Corporation (hereafter referred to as the “South Group”) the ultimate parent
company used the common share (850399200 shares) owned by its subsidiary Changan Group as part of the investment toestablish China South Industries Motor Company (hereafter referred to as” South Industries Motor”). The share occupied 52.466% of
the Company’s total share capital. Therefore South industries Motor became the parent company of the Company. On 30 March
2006 the transfer of share was registered by Shenzhen branch of China Securities Depository and Clearing Corporation limited.
In May 2006 South Industries Motor issued 3.2 bonus shares for each 10 shares to the shareholders at the implementation date ofreformation of non-tradable shares for their non-tradable shares according to the” Reply of the problems related to the reformation ofnon-tradable shares of Chongqing Changan Automobile Co. Ltd.” (2006[442] Guo Zi Chan Quan) issued by the State-owned Assets
Supervision and Administration Commission of State Council and the related shareholder’s meeting. After the reformation of
non-tradable shares South Industries Motor occupied 45.548% of equity through 738255200 common shares.
On 15 May 2007 the Company issued 2 bonus shares for each 10 shares to existing shareholders which increased the total share
capital from RMB 1620849200 to RMB 1945019040.
On 30 May 2008 the Company issued 2 shares for each 10 shares owned by existing shareholders. The issuance was made from
capital reserve and increased the total share capital to RMB 2334022848.
On 3 March 2009 the secondary temporary shareholder meeting was held. The board resolution about ‘the reacquisition of foreign
capital stock listed in China’ was approved in the meeting. For the buyback period ended on 3 March 2010 the company repurchased
8365233 shares in total equal to 0.3584% of total capital. On 17 March 2009 the company cancelled the share and the share capital
decreased to RMB 2325657615.
On 1 July 2009 with the approval of State Administration for Industry and Commercial South industries Motor the parent company
changed its name to China Changan Automobile Industry (Group) Co. Ltd. (hereafter referred to as the “China Changan”).With the approval of China Securities Regulatory Commission on 14 January 2011 the Company issued 360166022 common shares
(A share) which increased the total share capital to RMB 2685823637. After the completion of the issuance China Changan holds
1163787489 shares of the Company's common stock and the held equity interest decreased to 43.33%.
On 18 May 2011 the Company issued 4 bonus shares for each 10 shares and issued 4 shares to 10 shares from capital reserve to
existing shareholders. After this issuance the total share capital has been increased to RMB 4834482546.
On 21 December 2011 the first temporary shareholder meeting was held. The board resolution about ‘the reacquisition of foreign
capital stock listed in China’ was approved in the meeting. For the buyback period ended on 20 March 2012 the company
repurchased 171596438 shares in total equal to 3.55% of total capital. On 30 March 2012 the company cancelled the share and the
share capital decreased to RMB 4662886108.
During 2013 and 2014 China Changan the parent company of the Company continuously sold 181260000 and 89962264 shares
in total in secondary market. As at 31 December 2014 China Changan holds 1823595216 shares of the Company’s ordinary shares
with shares proportion decreasing to 39.11%.With the approval of China Securities Regulatory Commission on 14 September 2016 the Company issued 139762403 non-public
common shares (A share) to China Changan Automobile Industry (Group) Co. Ltd. which caused the total share capital increased to
RMB 4802648511. After the completion of the issuance China Changan holds 1963357619 shares of the Company's common
stock with shares proportion increasing to 40.88%.On June 15 2018 with the approval of the state-owned assets supervision and administration commission of the state council China
Changan the controlling shareholder of the company transfers the 1035312673 a-share shares held by the company to the ultimate
holding company of the company South Group and equipment group co. ltd. free of charge.
On December 31 2018 the controlling shareholder of the company China Changan and its wholly-owned subsidiary Zhonghui
futong (Hong Kong) investment co. LTD. together held 1082165183 ordinary shares of the company with an equity ratio of
22.53%. The ultimate controlling company of the company is China South Industries Group Co. Ltd.
The Group's main business activities are: the manufacture and sales of automobiles automobile engine series products and accessory
parts.The scope of consolidation in the consolidated financial statement is determined based on control. For the change of the
consolidation scope please refer to Note 8.
IV. BASIS OF PREPERATION
The financial statements have been prepared in accordance with Accounting Standards for Business Enterprises-Basic Standard and
the specific standards issued and modified subsequently and the implementation guidance interpretations and other relevant
provisions issued subsequently by the MOF (correctly referred to as “Accounting Standards for Business Enterprises”).The financial statements are presented on a going concern basis.The financial statements have been prepared under the historical cost convention except for certain financial instruments. If the
assets are impaired the corresponding provisions should be made accordingly.V. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
According to the actual production and operation characteristics the group formulated the specific accounting policies and
accounting estimates mainly reflected in provision of accounts receivables (note 5 (9-10)) inventory valuation (Note 5 (11))
depreciation of fixed assets intangible assets amortization (Note 5 (14) (17)) condition of capitalization of research and development
expense (Note 5 (18)) and revenue recognition and measurement (Note 5 (24)).
1. Statement of compliance with Accounting Standards for Business Enterprises
The financial statements present fairly and fully the financial position of the Company as at 30 June 2019 and the financial results
and the cash flows for the half year then ended in accordance with Accounting Standards for Business Enterprises.
2. Accounting year
The accounting year of the Group is from 1 January to 31 December of each calendar year.
3. Functional currency
The Group’s functional and reporting currency is the Renminbi (“RMB”). Unless otherwise stated the unit of the currency is Yuan.
Each entity in the Group determines its own functional currency in accordance with the operating circumstances. At the end of the
reporting period the foreign currency financial statements are translated into the reporting currency of the Company of RMB.
4. Business combination
Business combinations are classified into business combinations involving entities under common control and business combinations
involving entities not under common control.
Business combination involving entities under common control
A business combination involving entities under common control is a business combination in which all of the combining entities are
ultimately controlled by the same party or parties both before and after the combination and that control is not transitory. For a
business combination involving entities under common control the party which on the combination date obtains control of another
entity participating in the combination is the acquiring party while that other entity participating in the combination is a party being
acquired. Combination date is the date on which the acquiring party effectively obtains control of the party being acquired.
Assets and liabilities that are obtained by the acquiring party in a business combination involving entities under common control
shall be measured at their carrying amounts at the combination date as recorded by the party being acquired. The difference between
the carrying amount of the net assets obtained and the carrying amount of the consideration paid for the combination (or the
aggregate face value of shares issued as consideration) shall be adjusted to capital reserve. If the capital reserve is not sufficient to
absorb the difference any excess shall be adjusted against retained earnings.
Business combination involving entities not under common control
A business combination involving entities not 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. For a business combination
involving entities not under common control the party that on the acquisition date obtains control of another entity participating in
the combination is the acquirer while that other entity participating in the combination is the acquiree. Acquisition date is the date on
which the acquirer effectively obtains control of the acquiree.The acquirer shall measure the acquiree’s identifiable assets liabilities and contingent liabilities acquired in the business combination
at their fair values on the acquisition date.Goodwill is initially recognised and measured at cost being the excess of the aggregate of the fair value of the consideration
transferred (or the fair value of the equity securities issued) and any fair value of the Group’s previously held equity interest in the
acquiree over the Group’s interest in the fair value of the acquiree’s net identifiable assets. After initial recognition goodwill is
measured at cost less any accumulated impairment losses. Where the aggregate of the fair value of the consideration transferred (or
the fair value of the equity securities issued) and any fair value of the Group’s previously held equity interest in the acquiree is lower
than the Group’s interest in the fair value of the acquiree’s net identifiable assets the Group reassesses the measurement of the fair
value of the acquiree’s identifiable assets liabilities and contingent liabilities and the fair value of the consideration transferred (or
the fair value of the equity securities issued) together with the fair value of the Group’s previously held equity interest in the
acquiree. If after that reassessment the aggregate of the fair value of the consideration transferred (or the fair value of the equity
securities issued) and the Group’s previously held equity interest in the acquiree is still lower than the Group’s interest in the fair
value of the acquiree’s net identifiable assets the Group recognises the remaining difference in profit or loss.If a business combination not under the same control is realized step by step through multiple transactions the equity of the
purchased party held before the purchase date shall be re-measured according to the fair value of the equity on the purchase date and
the difference between the fair value and the book value shall be included in the calculation. Current profit and loss; if the equity of
the purchased party held before the purchase date involves other comprehensive income under the equity method it shall be
accounted for on the same basis as the investee directly disposes the relevant assets or liabilities except for net profit or loss other
comprehensive income. Changes in other shareholders' equity other than the profit distribution are transferred to the current profit
and loss of the purchase date.
5. Consolidated financial statements
The scope of the consolidated financial statements which include the financial statements of the Company and all of its subsidiaries
is determined on the basis of control. A subsidiary is an entity that is controlled by the Company (such as an enterprise a deemed
separate entity or a structured entity controlled by the Company).In the preparation of the consolidated financial statements the financial statements of the subsidiaries are prepared for the same
reporting period as the Company using consistent accounting policies. All intra-group assets and liabilities equity income expenses
and cash flows relating to transactions between members of the Group are eliminated in full on consolidation.When the current loss belong to minorities of the subsidiary exceeds the beginning equity of the subsidiary belong to minorities the
exceeded part will still deduct the equity belong to minorities.With respect to subsidiaries acquired through business combinations involving entities not under common control the operating
results and cash flows of the acquiree should be included in the consolidated financial statements from the day that the Group gains
control till the Group ceases the control of it. While preparing the consolidated financial statements the acquirer should adjust the
subsidiary’s financial statements on the basis of the fair values of the identifiable assets liabilities and contingent liabilities
recognized on the acquisition date.With respect to subsidiaries acquired through business combinations involving entities under common control the operating results
and cash flows of the acquiree should be included in the consolidated financial statements from the beginning of the period in which
the combination occurs.If the changes of relevant facts and circumstances will result in the changes of one or more control elements then the Group should
reassess whether it has taken control of the investee.
6. Joint venture arrangement classification and joint operation
Joint venture arrangements are classified into joint operation and joint venture. Joint operation refers to those joint venture
arrangements relevant assets and liabilities of which are enjoyed and assumed by the joint venturers. Joint ventures refer to those
joint venture arrangements only the right to net assets of which is enjoyed by the joint venturers.
Any joint venturer shall recognize the following items related to its share of benefits in the joint operation and conduct accounting
treatment in accordance with relevant accounting standards for business enterprises: assets it solely holds and its share of jointly-held
assets based on its percentage; liabilities it solely assumes and its share of jointly-assumed liabilities based on its percentage; incomes
from sale of output enjoyed by it from the joint operation; incomes from sale of output from the joint operation based on its
percentage; and separate costs and costs for the joint operation based on its percentage.
7. Cash and cash equivalents
Cash comprises cash on hand and bank deposits which can be used for payment at any time; Cash equivalents are short-term highly
liquid investments held by the Group that are readily convertible to known amounts of cash and which are subject to an insignificant
risk of changes in value.
8. Foreign currency translation
The Group translates the amount of foreign currency transactions occurred into functional currency.The foreign currency transactions are recorded on initial recognition in the functional currency by applying to the foreign currency
amount at the spot exchange rate on the transaction dates. Foreign currency monetary items are translated using the spot exchange
rate quoted by the People’s Bank of China at the balance sheet date. The exchange gains or losses arising from occurrence of
transactions and exchange of currencies except for those relating to foreign currency borrowings specifically for construction and
acquisition of fixed assets capitalized are dealt with in the profit and loss accounts. Non-monetary foreign currency items measured
at historical cost remain to be translated at the spot exchange rate prevailing on the transaction date and the amount denominated in
the functional currency should not be changed. Non-monetary foreign currency items measured at fair value should be translated at
the spot exchange rate prevailing on the date when the fair values are determined. The exchange difference thus resulted should be
charged to the current income or other comprehensive income account of the current period.When preparing consolidated financial statements the financial statements of the subsidiaries presented in foreign currencies are
translated into Renminbi as follows: asset and liability accounts are translated into Renminbi at exchange rates ruling at the balance
sheet date; shareholders’ equity accounts other than retained profits are translated into Renminbi at the applicable exchange rates
ruling at the transaction dates; income and expense in income statement are translated into Renminbi at spot exchange rates on
transaction occurrence; total difference between translated assets and translated liabilities and shareholders’ equity is separately listed
as “foreign currency exchange differences” below retained profits. The translation difference arising from the settlement of oversea
subsidiaries is charged to the current liquidation profit and loss in proportion to the settlement ratio of the assets concerned.
Foreign currency cash flows and the cash flows of foreign subsidiaries should be translated using the average exchange rate
prevailing on the transaction month during which the cash flows occur. The amount of the effect on the cash arising from the change
in the exchange rate should be separately presented as an adjustment item in the cash flow statement.
9. Financial instruments
(1) Financial instruments (Applicable since January 1 2019)
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of
another entity.Recognition and derecognition
The Group recognizes a financial asset or a financial liability when the Group becomes a party to the contractual provision of the
instrument.The Group derecognizes a financial asset (or part of a financial asset or part of a group of similar financial assets) be written off
from the account and balance sheet when the following conditions are met:
(1) the rights to receive cash flows from the asset have expired;
(2) the Group transferred the rights to receive cash flows from the asset or has assumed an obligation to pay the received cash
flows in full without material delay to a third party under a “pass-through” arrangement; and either (a) has transferred
substantially all the risks and rewards of the asset or (b) has neither transferred nor retained substantially all the risks and
rewards of the asset but has transferred control of the asset.If the underlying obligation of a financial liability has been discharged or cancelled or has expired the financial liability is
derecognized. If an existing financial liability is replaced by the same creditor with a new financial liability that has substantially
different terms or if the terms of an existing financial liability are substantially revised such replacement or revision is accounted for
as the derecognition of the original liability and the recognition of a new liability and the difference thus resulted is recognized in
profit or loss for the current period.When buy or sell financial instruments under a normal way financial instruments are recognized or derecognized according to the
transaction date accounting. A normal way to buy or sell financial instruments refers to according to the contract terms receive or
deliver financial instruments within the period as required by legal regulation or generally accepted guidelines. Transaction date
refers to the date when the Group committed to buy or sell financial instruments.
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 fair value and whose changes are
included in current profit or loss the financial assets measured at amortized cost the financial assets measured at fair value and
whose changes are included in other comprehensive income. A financial asset is recognized initially at fair value. However if the
accounts receivable or bills receivable arising from the sale of goods or the provision of services do not contain significant financing
elements or the financing elements not exceeding one year the initial measurement shall be made according to the transaction price.The subsequent measurement of financial assets depends on their classification as follows:
Financial assets measured at amortized cost
The Company classifies the financial assets that meet the following conditions as financial assets measured at amortized cost: the
group's business model for managing the financial assets is to collect contractual cash flows;
the contractual terms of the financial assets stipulate that cash flow generated on a specific date isonly 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 derecognized amortized by effective interest
method or impaired.Such financial assets mainly include monetary funds accounts receivable and notes receivable other
receivables creditor's rights investment and long-term receivables. The Group will present the creditor's rights investment and
long-term receivables maturing within one year from the balance sheet date as non-current assets maturing within one year and the
creditor's rights investment within one year from the original maturity date as other current assets.
Debt Instrument Investment measured at fair value and whose changes are included in other comprehensive income
Financial assets that meet the following conditions are classified as financial assets measured at fair value and whose changes are
included in other comprehensive gains: the business model of the Group's management of the financial assets is both to collect
contractual cash flows and to sell financial assets; the terms of the contract of the financial assets stipulate that the financial assets
shall be subject to specific conditions. The cash flow generated by the date is only the payment of principal and interest based on the
amount of outstanding principal. The real interest rate method is used to confirm the interest income of such financial assets. Except
that interest income impairment loss and exchange difference are recognized as current gains and losses other changes in fair value
are included in other comprehensive gains. When financial assets are terminated the accumulated gains or losses previously included
in other comprehensive gains are transferred from other comprehensive gains and recorded in current profits and losses. Such
financial assets are reported as other creditor's rights investment other creditor's rights investment due within one year from the
balance sheet date is reported as non-current assets due within one year and other creditor's rights investment due within one year
from the original maturity date is reported as other current assets.
Equity Instrument Investment Measured at Fair Value and Its Changes Included in Other Comprehensive Income
The Group irrevocably chooses to designate some non-tradable equity instrument investments as financial assets measured at fair
value and whose changes are included in other comprehensive income. Only relevant dividend income (excluding dividend income
explicitly recovered as part of investment cost) is included in current profits and losses and subsequent changes in fair value are
included in its current profits and losses. His comprehensive income does not require any provision for impairment. When financial
assets are terminated the accumulated gains or losses previously included in other comprehensive gains are transferred from other
comprehensive gains and included in retained earnings. Such financial assets are reported as investments in other equity instruments.If one of the following conditions is satisfied it belongs to transactional financial assets: the purpose of acquiring relevant financial
assets is mainly to sell or repurchase in the near future; it belongs to a part of the identifiable financial instruments portfolio under
centralized management and there is objective evidence that enterprises have adopted short-term profitability mode in the near
future; it belongs to derivative instruments but it does not belong to derivative instruments. The derivatives designated as valid
hedging instruments and in accordance with financial guarantee contracts shall be excluded.
Financial Assets Measured at Fair Value and Their Changes Included in Current Profits and Losses
The above-mentioned financial assets measured at amortized cost and those measured at fair value and whose changes are included
in other comprehensive income are classified as financial assets measured at fair value and whose changes are included in current
profits and losses. For such financial assets fair value is used for subsequent measurement and all changes in fair value are included
in current profits and losses. Such financial assets are reported as transactional financial assets and other non-current financial assets
whose maturity exceeds one year from the balance sheet date and whose expected holdings exceed one year are reported as other
non-current financial assets.Only when accounting mismatches can be eliminated or significantly reduced can financial assets be designated as financial assets
measured at fair value and recorded in current profits and losses at the initial measurement.When an enterprise designates a financial asset as a financial asset measured at fair value and its changes are included in current
profits and losses it can not be reclassified as other financial assets; nor can other financial assets be re-designated as a financial
asset measured at fair value after initial confirmation and its changes are included in current profits and losses.
Classification and measurement of financial liabilities
The Group’s financial liabilities are on initial recognition classified into the following categories: financial liabilities at fair value
through profit or loss other financial liabilities and the derivatives designated as effective hedging instrument. For financial
liabilities at fair value through profit or loss relevant transaction costs are directly recognized in profit or loss for the current period
and transaction costs relating to other financial liabilities are included in the initial recognition amounts.The subsequent measurement of financial liabilities depends on their classification as follows:
Financial liabilities measured at fair value and recorded in current profits and losses
Financial liabilities which are measured at fair value and whose changes are included in current profits and losses include
transactional financial liabilities (including derivatives belonging to financial liabilities) and financial liabilities designated at the
time of initial recognition as financial liabilities measured at fair value and whose changes are included in current profits and losses.Those who satisfy one of the following conditions are transactional financial liabilities: the purpose of assuming relevant financial
liabilities is mainly to sell or repurchase in the near future; they are part of a centrally managed identifiable portfolio of financial
instruments and there is objective evidence that enterprises have adopted short-term profitability mode in the near future; they are
derivatives but they are not. The derivatives designated as valid hedging instruments and in accordance with financial guarantee
contracts shall be excluded. Transactional financial liabilities (including derivatives belonging to financial liabilities) are
subsequently measured according to fair value. Except for hedging accounting all changes in fair value are included in current
profits and losses.Other financial liabilities
After initial recognition these financial liabilities are measured at amortized cost using the effective interest method.
Impairment of financial assets
Based on anticipated credit losses the Group undertakes impairment treatment of financial assets measured at amortized cost
investment in debt instruments measured at fair value and whose changes are included in other comprehensive gains and confirms
loss preparation.
Credit loss refers to the difference between the cash flow of all contracts discounted according to the original real interest rate and the
expected cash flow of all contracts receivable according to the contract i.e. the present value of all cash shortages. Among them the
financial assets purchased by the Group or originated from which credit impairment has occurred shall be discounted at the actual
interest rate adjusted by the credit of the financial assets.
For receivables and contractual assets that do not contain significant financing components the Group uses simplified measurement
methods to measure loss preparation in accordance with the amount of anticipated credit losses equivalent to the entire life cycle.In addition to the simplified measurement method mentioned above the Group assesses whether its credit risk has increased
significantly since the initial confirmation on each balance sheet day. If the credit risk has not increased significantly since the initial
confirmation it is in the first stage and the Group is in accordance with the amount equivalent to the expected credit loss in the next
12 months. If the credit risk has increased significantly since the initial confirmation but no credit impairment has occurred it is in
the second stage. The group measures the loss preparation according to the amount equivalent to the anticipated credit loss during the
whole life period and calculates the interest income according to the book balance and the actual interest rate. Interest income is
calculated with the actual interest rate; if credit impairment occurs after initial confirmation it is in the third stage. The group
measures loss preparation according to the amount equivalent to the expected credit loss during the whole life period and calculates
interest income according to the amortized cost and the actual interest rate. For financial instruments with low credit risk on balance
sheet day the Group assumes that their credit risk has not increased significantly since the initial confirmation.The Group evaluates the expected credit losses of financial instruments on a single and combined basis. Considering the credit risk
characteristics of different customers the Group evaluates the expected credit losses of financial instruments based on the age
portfolio.In assessing anticipated credit losses the Group takes into account reasonable and valid information on past events current
conditions and future economic forecasts.When the Group no longer reasonably expects to be able to recover all or part of the cash flow of the financial assets contract the
Group directly deducts the book balance of the financial assets.Offsetting of financial instruments
Financial assets and financial liabilities are offset and the net amount is reported in the balance sheet if there is a currently
enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis or to realise the assets and
settle the liabilities simultaneously.Transfer of financial assets
If the Group transfers substantially all the risks and rewards of ownership of the financial asset the Group derecognizes the financial
asset; and if the Group retains substantially all the risks and rewards of the financial asset the Group does not derecognize the
financial asset.If the Group neither transfers nor retains substantially all the risks and rewards of ownership of the financial asset the Group
determines whether it has retained control of the financial asset. In this case: (i) if the Group has not retained control it derecognizes
the financial asset and recognize separately as assets or liabilities any rights and obligations created not retained in the transfer; (ii) if
the Group has retained control it continues to recognize the financial asset to the extent of its continuing involvement in the
transferred financial asset and recognizes an associated liability.If the transfer of financial assets is continued to be involved by providing financial guarantee the assets formed by the continued
involvement shall be confirmed according to the lower of the book value of the financial assets and the amount of financial
guarantee. The amount of financial guarantee refers to the maximum amount that will be required to be repaid in the consideration
received.
(2) Financial instruments (Applicable before January 1 2019)
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of
another entity.Recognition and derecognition
The Group recognizes a financial asset or a financial liability when the Group becomes a party to the contractual provision of the
instrument.The Group derecognizes a financial asset (or part of a financial asset or part of a group of similar financial assets) be written off
from the account and balance sheet when the following conditions are met:
(1) the rights to receive cash flows from the asset have expired;
(2) the Group transferred the rights to receive cash flows from the asset or has assumed an obligation to pay the received cash
flows in full without material delay to a third party under a “pass-through” arrangement; and either (a) has transferred
substantially all the risks and rewards of the asset or (b) has neither transferred nor retained substantially all the risks and
rewards of the asset but has transferred control of the asset.If the underlying obligation of a financial liability has been discharged or cancelled or has expired the financial liability is
derecognized. If an existing financial liability is replaced by the same creditor with a new financial liability that has substantially
different terms or if the terms of an existing financial liability are substantially revised such replacement or revision is accounted for
as the derecognition of the original liability and the recognition of a new liability and the difference thus resulted is recognized in
profit or loss for the current period.When buy or sell financial instruments under a normal way financial instruments are recognized or derecognized according to the
transaction date accounting. A normal way to buy or sell financial instruments refers to according to the contract terms receive or
deliver financial instruments within the period as required by legal regulation or generally accepted guidelines. Transaction date
refers to the date when the Group committed to buy or sell financial instruments.
Classification and measurement of financial assets
Financial assets are on initial recognition classified into the following categories: financial assets at fair value through profit or loss
held-to-maturity investments loans and receivables available-for-sale financial assets and the derivatives designated as effective
hedging instrument. A financial asset is recognized initially at fair value. In the case of financial assets at fair value through profit
or loss relevant transaction costs are directly charged to the profit and loss of the current period; transaction costs relating to
financial assets of other categories are included in the amount initially recognized.The subsequent measurement of financial assets depends on their classification as follows:
Financial assets at fair value through profit or loss
Financial assets at fair value through profit or loss include financial assets held for trading and those designated upon initial
recognition as at fair value through profit or loss. A financial asset held for trading is the financial asset that meets one of the
following conditions: the financial asset is acquired for the purpose of selling it in a short term; the financial asset is a part of a group
of identifiable financial instruments that are collectively managed and there is objective evidence indicating that the enterprise
recently manages this group for the purpose of short-term profits; the financial asset is a derivative except for a derivative that is
designated as effective hedging instrument or a financial guarantee contract or a derivative that is linked to and must be settled by
delivery of an unquoted equity instrument (without a quoted price from an active market) whose fair value cannot be reliably
measured. For such kind of financial assets fair values are adopted for subsequent measurement. All the realized or unrealized gains
or losses on these financial assets are recognized in profit or loss for the current period. Dividend or interest income related to
financial assets at fair value through profit or loss is recognized in profit or loss for the current period.Held-to-maturity investments
Held-to-maturity investments are non-derivative financial assets with fixed or determinable payments and fixed maturity that an
entity has the positive intention and ability to hold to maturity. Such kind of financial assets are subsequently measured at amortized
cost using the effective interest method. Gains or losses arising from derecognition impairment or amortization are recognized in
profit or loss for the current period.Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active
market. Such kind of financial assets are subsequently measured at amortized cost using the effective interest method. Gains or losses
arising from derecognition impairment or amortization are recognized in profit or loss for the current period.
Available-for-sale financial assets
Available-for-sale financial assets are those non-derivative financial assets that are designated as available for sale or are not
classified as the above financial assets. After initial recognition available-for-sale financial assets are measured at fair value. The
premium/discount is amortized using effective interest method and recognized as interest income or expense. A gain or loss arising
from a change in the fair value of an available-for-sale financial asset is recognized in other comprehensive income as a component
of capital reserve except for impairment losses and foreign exchange gains and losses resulted from monetary financial assets until
the financial asset is derecognized or determined to be impaired at which time the accumulated gain or loss previously recognized in
capital reserve is removed from capital reserve and recognized in profit or loss for the current period. Interests and dividends relating
to an available-for-sale financial asset are recognized in profit or loss for the current period.The equity investment instruments for which there is no quoted price in active market and whose fair value cannot be reliably
measured shall be measured at cost.
Classification and measurement of financial liabilities
The Group’s financial liabilities are on initial recognition classified into the following categories: financial liabilities at fair value
through profit or loss other financial liabilities and the derivatives designated as effective hedging instrument. For financial
liabilities at fair value through profit or loss relevant transaction costs are directly recognized in profit or loss for the current period
and transaction costs relating to other financial liabilities are included in the initial recognition amounts.The subsequent measurement of financial liabilities depends on their classification as follows:
Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss include financial liabilities held for trading and those designated as at fair value
through profit or loss. A financial liability held for trading is the financial liability that meets one of the following conditions: the
financial liability is assumed for the purpose of repurchasing it in a short term; the financial liability is a part of a group of
identifiable financial instruments that are collectively managed and there is objective evidence indicating that the enterprise recently
manages this group for the purpose of short-term profits; the financial liability is a derivative except for a derivative that is
designated and effective hedging instrument or a financial guarantee contract or a derivative that is linked to and must be settled by
delivery of an unquoted equity instrument (without a quoted price form an active market) whose fair value cannot be reliably
measured. For such kind of financial liabilities fair values are adopted for subsequent measurement. All the realized or unrealized
gains or losses on these financial liabilities are recognized in profit or loss for the current period.Other financial liabilities
After initial recognition these financial liabilities are measured at amortized cost using the effective interest method.
Offsetting of financial instruments
Financial assets and financial liabilities are offset and the net amount is reported in the balance sheet if there is a currently
enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis or to realise the assets and
settle the liabilities simultaneously.Impairment of financial assets
The Group assesses the carrying amount of a financial asset at the balance sheet date. If there is objective evidence that the financial
asset is impaired the Group makes provision for the impairment loss. Objective evidence that a financial asset is impaired is
evidence arising from one or more events that occurred after the initial recognition of the asset and that event has an impact on the
estimated future cash flows of the financial asset which can be reliably estimated.
Financial assets carried at amortized cost
When the financial assets carried at amortized cost are impaired the carrying amount of the financial asset shall be reduced to the
present value of the estimated future cash flow (excluding future credit losses that have not been incurred). The amount of reduction
is recognized as an impairment loss in the income statement. Present value of estimated future cash flow is discounted at the financial
asset’s original effective interest rate and includes the value of any related collateral.If a financial asset is individually significant the Group assesses the asset individually for impairment and recognizes the amount of
impairment in the income statement if there is objective evidence of impairment. For a financial asset that is not individually
significant the Group can include the asset in a group of financial assets with similar credit risk characteristics and collectively
assess them for impairment. Assets for which an impairment loss is individually recognized will not be included in a collective
assessment of impairment.If subsequent to the recognition of an impairment loss on a financial asset carried at amortized cost there is objective evidence of a
recovery in value of the financial asset which can be related objectively to an event occurring after the impairment was recognized
the previously recognized impairment loss is reversed and recognized in the income statement. However the reversal shall not result
in a carrying amount of the financial asset that exceeds what the amortized cost would have been had the impairment not been
recognized at the date the impairment is reversed.
Available-for-sale financial assets
When there is objective evidence that the asset is impaired the cumulative loss from declines in fair value that had been recognized
directly in capital reserve are removed from equity and recognized in the income statement. The amount of the cumulative loss that is
removed from capital reserves and recognized in the income statement (net of any principal repayment and amortization) and current
fair value less any impairment loss on that financial asset previously recognized in the income statement.Impairment of financial assets In the case of equity investments classified as available for sale objective evidence would include a
significant or prolonged decline in the fair value of an investment below its cost. The determination of what is “significant” or''prolonged” requires judgement. “Significant” is evaluated against the original cost of the investment and “prolonged” against theperiod in which the fair value has been below its original cost. Impairment losses on equity instruments classified as available for sale
are not reversed through the income statement. Increases in their fair value after impairment are recognised directly in other
comprehensive income.The determination of what is “significant” or “prolonged” requires judgement. In making this judgement the Group evaluates
among other factors the duration or extent to which the fair value of an investment is less than its cost.
Financial assets carried at cost
If objective evidence shows that the financial assets carried at cost are impaired the difference between the present value discounted
at the prevailing rate of return of similar financial assets and the book value of the financial asset are provided as a provision and
recognized in the current income statement. The impairment loss recognized cannot be reversed.Transfer of financial assets
If the Group transfers substantially all the risks and rewards of ownership of the financial asset the Group derecognizes the financial
asset; and if the Group retains substantially all the risks and rewards of the financial asset the Group does not derecognize the
financial asset.If the Group neither transfers nor retains substantially all the risks and rewards of ownership of the financial asset the Group
determines whether it has retained control of the financial asset. In this case: (i) if the Group has not retained control it derecognizes
the financial asset and recognize separately as assets or liabilities any rights and obligations created not retained in the transfer; (ii) if
the Group has retained control it continues to recognize the financial asset to the extent of its continuing involvement in the
transferred financial asset and recognizes an associated liability.
10. Accounts receivable
(1) Accounts receivable (effective since 1 January 2019)
The determination method and accounting treatment method of the anticipated credit loss of bills receivable and accounts receivable
of the Group as of January 1 2019 are detailed in this chapter "9. Financial instruments (for trial use as since January 1 2019)".
(2) Accounts receivable (effective before 1 January 2019)
①Accounts receivable which is individually significant and analyzed individually for provision：
Criterion for individually significant items
Accounts receivable balance greater than RMB15 million due from
non-related parties
Method for provision
A provision of the difference between recoverable amount and book
value is recognized based on individually analysis
② Accounts receivable analyzed by credit risk charactristics group for provision：
Criterion for group
Group 1
Accounts receivable due from non-related parties other than individually significant items or
insignificantly but analyzed individually for provision
Group 2 Accounts receivable due from related parties
Method for the provision of group
Group 1 Making provision according to aging analysis
Group 2
A provision of the difference between recoverable amount and book value is recognized based on
individually analysis.Group 1 the provision analyzed according to aging analysis:
Aging Accounts receivable
Provision percentage (%)
Other receivables
Provision percentage (%)
Within 1 year
Within 6 months 0 0
6 to 12 months 5 5
1 to 2 years 10 10
2 to 3 years 30 30
3 to 4 years 50 50
4 to 5 years 80 80
Above 5 years 100 100
③Accounts receivable which is individually insignificant but analyzed individually for provision
Criterion for individually analysis for
provision
There is objective evidence that the accounts receivable due from non-related parties
is impaired and the future recoverable possibility is little.Method for provision
A provision of the difference between recoverable amount and book value is
recognized individually.
11. Inventories
Inventory includes raw materials goods in transit work in progress finished goods consigned processing materials low-value
consumables and spare parts.Inventory is initially carried at the actual cost. Inventory costs comprise all costs of purchase costs of conversion and other costs
incurred in bringing the inventory to its present location and condition. Weighted average method is assigned to the determination of
actual costs of inventories. One-off writing off method is adopted in amortization of low-value consumables.The Group applies a perpetual counting method of inventory.
At the balance sheet date the inventory is stated at the lower of cost and net realizable value. If the cost is higher than the net
realizable value provision for the inventory should be made through profit or loss. If factors that resulted in the provision for the
inventory have disappeared and made the net realizable value higher than their book value the amount of the write-down should be
reversed to the extent of the amount of the provision for the inventory and the reversed amount should be recognized in the income
statement for the current period.Net realizable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the
estimated costs necessary to make the sale. The impairment provision should be made on a basis of each item of inventories
according to the difference between cost and net realizable value. For large numbers of inventories at relatively low unit prices the
provision for loss on decline in value of inventories should be made by category.
12. Long-term equity investments
Long-term equity investments include investments in subsidiaries joint ventures and associates.
The long-term investments are initially recorded at costs on acquisition. Long-term investments acquired from business combination
under common control shall be initially measured at the carrying value of the held interest of the party being acquired; The difference
between the initial measured amounts and the book value of consideration adjust the capital reserves (if the capital reserve is
insufficient to be offset retained earnings should be adjusted); Long-term investments acquired from business combination not under
common control shall be initially measured at the cost (or the sum of the cost and the carrying value of the previously held equity
interest in the acquire for the business combination achieved by stages) which include the fair value of the consideration paid the
liabilities beard and the fair value of issued equity instrument; the other comprehensive income produced from the investment before
the acquisition should be transferred into the current year investment income on disposal.Long-term investments acquired not from business combination are initially measured at 1)the consideration together with the cost
necessary incurred; 2) the fair value of the equity instruments; and 3) the consideration agreed in the investment agreement by the
investors otherwise the agreed consideration were not fair
The Company adopted cost method to account for long-term investments in the subsidiaries in the separate financial statements of the
Company. Control is the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities.
Under cost method the long-term equity investment is valued at the cost of the initial investment. The cost of long-term equity
investment should be adjusted in case of additional investment or disinvestments. When cash dividends or profits are declared by
the invested enterprise is recognized as investment income in current period.The equity method is applied to account for long-term equity investments when the Group has jointly control or significant
influence on the investee enterprise. Joint control is the contractually agreed sharing of control over an economic activity and exists
only when the strategic financial and operating decisions relating to the activity require the unanimous consent of the parties sharing
control (the venturers). Significant influence is the power to participate in the financial and operating policy decisions of an economic
activity but is not control or joint control over those policies.Under equity method the Group recognizes its share of post-acquisition equity in the investee enterprise for the current period as a
gain or loss on investment and also increases or decreases the carrying amount of the investment. When recognizing its share in the
net profit or loss of the investee entities the Group should based on the fair values of the identifiable assets of the investee entity
when the investment is acquired in accordance with the Group’s accounting policies and periods after eliminating the portion of the
profits or losses arising from internal transactions with joint ventures and associates attributable to the investing entity according to
the share ratio (but losses arising from internal transactions that belong to losses on the impairment of assets should be recognized in
full) recognize the net profit of the investee entity after making appropriate adjustments. The book value of the investment is reduced
to the extent that the Group’s share of the profit or cash dividend declared to be distributed by the investee enterprise. However the
share of net loss is only recognized to the extent that the book value of the investment is reduced to zero except to the extent that the
Group has incurred obligations to assume additional losses. The Group shall adjust the carrying amount of the long-term equity
investment for other changes in owners’ equity of the investee enterprise (other than net profits or losses) and include the
corresponding adjustments in equity which should be realized through profit or loss in subsequent settlement of the respective
long-term investment.On settlement of a long-term equity investment the difference between the proceeds actually received and the carrying amount shall
be recognized in the income statement for the current period. As to other comprehensive income recognized based on measurement
of the original equity investment by employing the equity method accounting treatment shall be made on the same basis as would be
required if the invested entity had directly disposed of the assets or liabilities related thereto when measurement by employing the
equity method is terminated. As to any change in owners' equity of the invested entity other than net profit or loss other
comprehensive income and profit distribution the investing party shall be transferred to the income statement for the current period.If the remaining equities still be measured under the equity method accumulative change previously recorded in other
comprehensive income shall be transferred to current profit or loss in measurement on the same basis as the invested entity had
directly disposed of the assets or liabilities related thereto. The income or loss recorded in the equity directly should been transferred
to the current income statement on settlement of the equity investment on the disposal proportion.
13. Investment property
Investment property are properties held to earn rentals or for capital appreciation or both including rented land use right land use
right which is held and prepared for transfer after appreciation and rented building.The initial measurement of the investment property shall be measured at its actual cost. The follow-up expenses pertinent to an
investment property shall be included in the cost of the investment property if the economic benefits pertinent to this real estate are
likely to flow into the enterprise and the cost of the investment property can be reliably measured. Otherwise they should be
included in the current profits and losses upon occurrence.The group adopts the cost method to make follow-up measurement to the investment property. The buildings are depreciated under
straight-line method.
14. Fixed assets
A fixed asset probably shall be recognized only when the economic benefits associated with the asset will flow to the Group and the
cost of the asset can be measured reliably. Subsequent expenditure incurred for a fixed asset that meet the recognition criteria shall be
included in the cost of the fixed asset and the book value of the component of the fixed asset that is replaced shall be derecognized.Otherwise such expenditure shall be recognized in the income statement in the period during which they are incurred.
Fixed assets are initially measured at actual cost on acquisition. The cost of a purchased fixed asset comprises the purchase price
relevant taxes and any directly attributable expenditure for bringing the asset to working condition for its intended use such as
delivery and handling costs installation costs and other surcharges.
Fixed assets are depreciated on straight-line basis. The estimated useful lives estimated residual values and annual depreciation rates
for each category of fixed assets are as follows:
Category Deprecation period Residual rate (%) Yearly deprecation rate (%)
Buildings 20 to 35 years 3% 2.77%-4.85%
Machinery (Note) 5 to 20 years 3% 4.85%-19.40%
Vehicles 4 to 10 years 3% 9.70%-24.25%
Others 3 to 21 years 3% 4.62%-32.33%
Note: the molds in machinery should be depreciated in units-of-production method.The Group reviews the useful life and estimated net residual value of a fixed asset and the depreciation method applied at least at the
end of each year and makes adjustments if necessary.
15. Construction in progress
The cost of construction in progress is determined according to the actual expenditure for the construction including all necessary
construction expenditure incurred during the construction period borrowing costs that should be capitalized before the construction
reaches the condition for intended use and other relevant expenses.
Construction in progress is transferred to fixed assets when the asset is ready for its intended use.
16. Borrowing costs
Borrowing costs are interest and other costs incurred by the Group in connection with the borrowing of the funds. Borrowing costs
include interest amortization of discounts or premiums related to borrowings ancillary costs incurred in connection with the
arrangement of borrowings and exchange differences arising from foreign currency borrowings.The borrowing costs that are directly attributable to the acquisition construction or production of a qualifying asset are capitalized
otherwise the borrowing costs are expensed in the period during which they are incurred. A qualifying asset is an asset (an item of
property plant and equipment and inventory etc.) that necessarily takes a substantial period of time to get ready for its intended use
of sale.The capitalization of borrowing costs is as part of the cost of a qualifying asset shall commence when:
1) expenditure for the asset is being incurred;
2) borrowing costs are being incurred; and
3) activities that are necessary to prepare the asset for its intended use or sale are in progress.
Capitalization of borrowing costs shall be ceased when substantially all the activities necessary to prepare the qualifying asset for its
intended use or sale have been done. And subsequent borrowing costs are recognized in the income statement.
During the capitalization period the amount of interest to be capitalized for each accounting period shall be determined as follows:
1) where funds are borrowed for a specific-purpose the amount of interest to be capitalized is the actual interest expense incurred
on that borrowing for the period less any bank interest earned form depositing the borrowed funds before being used on the asset or
any investment income on the temporary investment of those funds;
2) where funds are borrowed for a general-purpose the amount of interest to be capitalized on such borrowings is determined by
applying a weighted average interest rate to the weighted average of the excess amounts of cumulative expenditure on the asset over
and above the amounts of specific-purpose borrowings.
During the construction or manufacture of assets that are qualified for capitalization if abnormal discontinuance other than
procedures necessary for their reaching the expected useful conditions happens and the duration of the discontinuance is over three
months the capitalization of the borrowing costs is suspended. Borrowing costs incurred during the discontinuance are recognized as
expense and charged to the income statement of the current period till the construction or manufacture of the assets resumes.
17. Intangible assets
An intangible asset probably shall be recognized only when the economic benefits associated with the asset will flow to the Group
and the cost of the asset can be measured reliably. Intangible assets are initially measured at cost. The cost of intangible assets
acquired in a business combination is the fair value as at the date of acquisition if the fair value can be reliably measured.The useful life of the intangible assets shall be assessed according to the estimated beneficial period expected to generate economic
benefits. An intangible asset shall be regarded as having an indefinite useful life when there is no foreseeable limit to the period over
which the asset is expected to generate economic benefits for the Group.The useful lives of the intangible assets are as follow:
Useful life
Land use right 43 to 50 years
Software 2 years
Trademark 10 years
Non-patent technology 5 years
Land use rights that are purchased or acquired through the payment of land use fees are accounted for as intangible assets. With
respect to self-developed properties the corresponding land use right and buildings should be recorded as intangible and fixed assets
separately. As to the purchased properties if the reasonable allocation of outlays cannot be made between land and buildings all
assets purchased will be recorded as fixed assets. The cost of a finite useful life intangible asset is amortized using the straight-line
method during the estimated useful life. For an intangible asset with a finite useful life the Group reviews the estimated useful life
and amortization method at least at the end of each year and adjusts if necessary.The Group should test an intangible asset with an indefinite useful life for impairment by comparing its recoverable amount with its
carrying amount annually whenever there is an indication that the intangible asset may be impaired. An intangible asset with an
indefinite useful life shall not be amortized.The useful life of an intangible asset that is not being amortised shall be reviewed each period to determine whether events and
circumstances continue to support an indefinite useful life assessment for that asset. If there are indicators that the intangible asset
has finite useful life the accounting treatment would be in accordance with the intangible asset with finite useful life.
18. Research and development expenditures
The Group classified the internal research and development expenditures as follows: research expenditures and development cost.The expenditures in research stage are charged to the current income on occurrence.The expenditures in development stage are capitalized that should meet all the conditions of (a) it is technically feasible to finish
intangible assets for use or sale; (b) it is intended to finish and use or sell the intangible assets; (c) the usefulness of methods for
intangible assets to generate economic benefits shall be proved including being able to prove that there is a potential market for the
products manufactured by applying the intangible assets or there is a potential market for the intangible assets itself or the intangible
assets will be used internally; (d) it is able to finish the development of the intangible assets and able to use or sell the intangible
assets with the support of sufficient technologies financial resources and other resources; and (e) the development expenditures of
the intangible assets can be reliably measured. Expenses incurred that don’t meet the above requirements unanimously should be
expensed in the income statement of the reporting period.The Group discriminates between research and development stage with the condition that the project research has been determined
in which the relevant research complete all the fractionalization of products measurements and final product scheme under final
approval of management. The expenditures incurred before project-determination stage is charged to the current income otherwise it
is recorded as development cost.
19. Impairment of assets
The Group determines the impairment of assets other than the impairment of inventory deferred income taxes and financial assets
using the following methods:
The Group assesses at the balance sheet date whether there is any indication that an asset may be impaired. If any indication exists
that an asset may be impaired the Group estimates the recoverable amount of the asset and performs impairment tests. Goodwill
arising from a business combination and an intangible asset with an indefinite useful life are tested for impairment at least at the end
of every year irrespective of whether there is any indication that the asset may be impaired. An intangible asset which is not ready
for its intended use is tested for impairment at least at the end of every year.The recoverable amount of an asset is the higher of its fair value less costs to sell and the present value of the future cash flow
expected to be derived from the asset. The Group estimates the recoverable amount on an individual basis. If it is not possible to
estimate the recoverable amount of the individual asset the Group determines the recoverable amount of the asset group to which the
asset belongs. Identification of an asset group is based on whether major cash flows generated by the asset group are independent of
the cash flows from other assets or asset groups.When the recoverable amount of an asset or asset group is less than its carrying amount the carrying amount is reduced to the
recoverable amount. The impairment of asset is provided for and the impairment loss is recognized in the income statement for the
current period.
For the purpose of impairment testing the carrying amount of goodwill acquired in a business combination is allocated on a
reasonable basis to related asset groups; if it is impossible to allocate to the related asset groups it is allocated to each of the related
sets of asset groups. Each of the related asset groups or related sets of asset groups is a group or set of asset group that is able to
benefit from the synergies of the business combination and shall not be larger than a reportable segment determined by the Group.When an impairment test is conducted on an asset group or a set of asset groups that contains goodwill if there is any indication of
impairment the Group firstly tests the asset group or the set of asset groups excluding the amount of goodwill allocated for
impairment i.e. it determines and compares the recoverable amount with the related carrying amount and then recognize impairment
loss if any. Thereafter the Group tests the asset group or set of asset groups including goodwill for impairment the carrying amount
(including the portion of the carrying amount of goodwill allocated) of the related asset group or set of asset groups is compared to its
recoverable amount. If the carrying amount of the asset group or set of asset groups is higher than its recoverable amount the amount
of the impairment loss is firstly eliminated by and amortized to the book value of the goodwill included in the asset group or set of
asset groups and then eliminated by the book value of other assets according to the proportion of the book values of assets other than
the goodwill in the asset group or set of asset groups. Once the above impairment loss is recognized it cannot be reversed in
subsequent periods.
20. Long-term deferred expenses
The long-term deferred expenses represent the payment for the improvement on buildings and other expenses which have been paid
and should be deferred in the following years. Long-term deferred expenses are amortized on the straight-line basis over the expected
beneficial period and are presented at actual expenditure net of accumulated amortization.
21. Employee benefits
Employee benefits refer to all kinds of remunerations or compensation made by enterprises to their employees in exchange for
services provided by the employees or termination of labor relation. Employee compensation includes short-term compensation and
post-employment benefits. The benefits offered by enterprises to the spouse children the dependents of the employee the family
member of deceased employee and other beneficiaries are also employee compensation.Short-term employee salaries
During the accounting period of employee rendering service the actural employees salaries and are charged to the statement of profit
or loss as they become payable in balance sheet.Post-employment benefits (Defined contribution plans)
The employees of the Group participate in pension insurance which is managed by local government and the relevant expenditure is
recognized when incurred in the costs of relevant assets or the profit and loss for the current period.Post-employment benefits (Defined benefit plan)
The Group operates a defined benefit pension plan which requires contributions to be made to a separately administered fund. The
benefits are unfunded. The cost of providing benefits under the defined benefit plan is determined using the projected unit credit
actuarial valuation method.Remeasurements arising from defined benefit pension plans are recognised immediately in the consolidated statement of financial
position with a corresponding debit or credit to retained profits through other comprehensive income in the period in which they
occur. Remeasurements are not reclassified to profit or loss in subsequent periods.Past service costs are recognised in profit or loss at the earlier of: the date of the plan amendment or curtailment; and the date that the
Group recognises restructuring-related costs.Net interest is calculated by applying the discount rate to the net defined benefit liability or asset. The Group recognises the
following changes in the net defined benefit obligation under administrative expenses in the consolidated statement of profit or loss
by function: ?service costs comprising current service costs past-service costs gains and losses on curtailments and non-routine
settlements;net interest expense or income.Termination benefits
Termination benefits are recognised at the earlier of when the Group can no longer withdraw the offer of those benefits and when the
Group recognises restructuring costs involving the payment of termination benefits.
22. Provisions
An obligation related to a contingency shall be recognised by the Group as a provision when all of the following conditions are
satisfied except for contingent considerations and contingent liabilities assumed in a business combination not involving entities
under common control:
1) the obligation is a present obligation of the Group;
2) it is probable that an outflow of economic benefits from the Group will be required to settle the obligation;
3) a reliable estimate can be made of the amount of the obligation.
Contingent liabilities are initially measured according to the current best estimate for the expenditure necessary for the performance
of relevant present obligations with comprehensive consideration given to factors such as the risks uncertainty and time value of
money relating to contingencies. The book value of the contingent liabilities should be reviewed at each balance sheet date. If there is
objective evidence showing that the book value cannot reflect the present best estimate the book value should be adjusted according
to the best estimate.
23. Share-based payments
The share-based payments shall consist of equity-settled share-based payments and cash-settled share-based payments. The term
"equity-settled share-based payment" refers to a transaction in which an enterprise grants shares or other equity instruments as a
consideration in return for services.
The equity-settled share-based payment in return for employee services shall be measured at the fair value of the equity instruments
granted to the employees. As to an equity-settled share-based payment in return for services of employees if the right may be
exercised immediately after the grant the fair value of the equity instruments shall on the date of the grant be included in the
relevant cost or expense and the capital reserves shall be increased accordingly. As to a equity-settled share-based payment in return
for employee services if the right cannot be exercised until the vesting period comes to an end or until the prescribed performance
conditions are met then on each balance sheet date within the vesting period the services obtained in the current period shall based
on the best estimate of the number of vested equity instruments be included in the relevant costs or expenses and the capital reserves
at the fair value of the equities instruments on the date of the grant. The fair value is determined using Black-Scholes model (Note
13).
Within the vesting period or before the prescribed performance conditons are met the relevant costs or expenses and capital reserves
shall be determined and increased based on the best estimate of the number of vested equity instruments on each balance sheet date.
For awards that do not ultimately vest because non-market performance and/or service conditions have not been met no expense is
recognised. Where awards include a market or non-vesting condition the transactions are treated as vesting irrespective of whether
the market or non-vesting condition is satisfied provided that all other performance and/or service conditions are satisfied.Where the terms of an equity-settled award are modified as a minimum an expense is recognised as if the terms had not been
modified if the original terms of the award are met. In addition an expense is recognised for any modification that increases the total
fair value of the share-based payments or is otherwise beneficial to the employee as measured at the date of modification.Where an equity-settled award is cancelled it is treated as if it had vested on the date of cancellation and any expense not yet
recognised for the award is recognised immediately. This includes any award where non-vesting conditions within the control of
either the Group or the employee are not met. However if a new award is substituted for the cancelled award and is designated as a
replacement award on the date that it is granted the cancelled and new awards are treated as if they were a modification of the
original award as described in the previous paragraph.
24. Revenue
Revenue is recognized only when an inflow of economic benefits is probable the amount of which can be reliably measured and all
of the following conditions are qualified.Revenue from the sale of goods
The Group has transferred to the buyer the significant risks and rewards of ownership of the goods; the Group retains neither
continuing management involvement to the degree usually associated with ownership nor effective control over the goods sold; and
the amount of revenue can be measured reliably. The proceeds earned from sales of goods are determined based on the amount
received or receivable as stipulated in the contract or agreement otherwise the amount is not fair; If the amount received or
receivable as stipulated in the contract or agreement is collected in a defer method it includes the financing elements and should be
determined according to the fair value of the amount received or receivable as stipulated in the contract or agreement.Revenue from the rendering of services
When the outcome of a transaction involving the rendering of services can be estimated reliably at the balance sheet date revenue
associated with the transaction is recognized using the percentage of completion method or otherwise the revenue is recognized to
the extent of costs incurred that are expected to be recoverable. The outcome of a transaction involving rendering of services can be
estimated reliably when all of the following conditions are satisfied: the amount of revenue can be measured reliably; it is probable
that the associated economic benefits will flow into the Group; the stage of completion of the transaction can be measured reliably;
and the costs incurred and to be incurred for the transaction can be measured reliably. The Group determines the stage of completion
of a transaction involving the rendering of services by using the proportion of services performed to date to the total services to be
performed. The total amount of revenue earned from rendering service are determined based on the amount received or receivable as
stipulated in the contract or agreement otherwise the amount is not fair.Interest income
It should be measured based on the length of time for which the Group’s cash is used by others and the applicable effective interest
rate.Royalty income
Royalty income is recognized according to the agreed time and method by both parties in related contracts.Rental income
Rental income from operating leases is recognized by the lesser in the income statement on a straight-line basis over the lease term.The contingent rents shall be recorded in the profits and losses of the period in which they actually arise.
25. Government grants
A government grant is recognized only when there is reasonable assurance that the entity will comply with any conditions attached to
the grant and the grant will be received. Monetary grants are accounted for at received or receivable amount. Non-monetary grants
are accounted for at fair value. If there is no reliable fair value available the grants are accounted for a nominal amount.
A government grant which is specified by the government documents to be used to purchase and construct the long-term assets shall
be recognized as the government grant related to assets. A government grant which is not specified by the government documents
shall be judged based on the basic conditions to obtain the government grant. The one whose basic condition was to purchase and
construct the long-term assets shall be recognized as the government grant related to assets.The Group uses the gross method to account for government grants.Government grants related to income to be used as compensation for future expenses or losses shall be recognized as deferred income
and shall be charged to the current profit or loss or be used to write down the relevant loss during the recognition of the relevant cost
expenses or losses; or used as compensation for relevant expenses or losses already incurred by enterprises shall be directly charged
to the profit and loss account in the current period or used to write down the relevant cost.The government grants related to assets shall be used to write down the book value of the relevant assets or be recognized as deferred
income. The government grants related to assets recognized as deferred income shall be charged to the profit and loss reasonably
and systematically in stages over the useful lives of the relevant assets. The government grants measured at nominal amount shall be
directly charged to the current profit and loss. The remaining book value of the government grants related to assets should be
charged to the profit and loss account in the current period when the relative assets sold transferred disposed or damaged.
26. Income taxes
Income tax comprises current and deferred tax. Income tax is recognized as an income or an expense and include in the income
statement for the current period except to the extent that the tax arises from a business combination or if it relates to a transaction or
event which is recognized directly in equity.
Current income tax liabilities or assets for the current and prior periods are measured at the amount expected to be paid (or
recovered) according to the requirements of tax laws.
For temporary differences at the balance sheet date between the tax bases of assets and liabilities and their carrying amounts and
temporary differences between the carrying amounts and the tax bases of items the tax bases of which can be determined for tax
purposes but which have not been recognized as assets and liabilities deferred taxes are provided using the liability method.
A deferred tax liability is recognized for all taxable temporary differences except:
(1) to the extent that the deferred tax liability arises from the initial recognition of goodwill or the initial recognition of an asset
or liability in a transaction which contains both of the following characteristics: the transaction is not a business combination
and at the time of the transaction it affects neither the accounting profit nor taxable profit or loss.
(2) in respect of taxable temporary differences associated with investments in subsidiaries associates and interests in
jointly-controlled enterprises where the timing of the reversal of the temporary differences can be controlled and it is
probable that the temporary differences will not reverse in the foreseeable future.
A deferred tax asset is recognized for deductible temporary differences carry forward of unused tax credits and unused tax losses to
the extent that it is probable that taxable profit will be available against which the deductible temporary differences and the carry
forward of unused tax credits and unused tax losses can be utilized except:
(1) where the deferred tax asset relating to the deductible temporary differences arises from the initial recognition of an asset or
liability in a transaction that is not a business combination and at the time of the transaction affects neither the accounting
profit nor taxable profit or loss; and
(2) in respect of deductible temporary differences associated with investments in subsidiaries associates and interests in joint
ventures deferred tax assets are only recognized to the extent that it is probable that the temporary differences will reverse in
the foreseeable future and taxable profit will be available against which the temporary differences can be utilized.
At the balance sheet date deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the period when
the asset is realized or the liability is settled according to the requirements of tax laws. The measurement of deferred tax assets and
deferred tax liabilities reflects the tax consequences that would follow from the manner in which the Group expects at the balance
sheet date to recover the assets or settle the liabilities.
At the balance sheet date the Group reviews the book value of deferred tax assets. If it is probable that sufficient taxable income
cannot be generated to use the tax benefits of deferred tax assets the book value of deferred tax assets should be reduced. When it is
probable that sufficient taxable income can be generated the amount of such reduction should be reversed. When it is probable that
sufficient taxable income can be generated the amount of such reduction should be reversed.
At the same time when the following conditions are met the deferred income tax assets and deferred income tax liabilities are shown
as net after offsetting: they have the legal right to settle current income tax assets and current income tax liabilities in net terms;
deferred income tax assets and deferred income tax liabilities are levied on the same taxpayable subject by the same tax collection
and administration department. Income tax is related to or related to different tax payers but in the future during each important
period of the transfer of deferred income tax assets and deferred income tax liabilities the tax payers involved intend to settle the
current income tax assets and current income tax liabilities in net or to acquire assets and pay off debts simultaneously.
27. Leases
A finance lease is a lease that transfers in substance all the risks and rewards incident to ownership of an asset. An operating lease is a
lease other than a finance lease.The Group recording the operating lease as a lessee
Lease payments under an operating lease are recognized by a lessee on a straight-line basis over the lease term and either included in
the cost of another related asset or charged to the income statement for the current period. The contingent rents shall be recorded in
the profits and losses of the period in which they actually arise.The Group recording the operating lease as a lessor
Rental income from operating leases is recognized by the lesser in the income statement on a straight-line basis over the lease term.The contingent rents shall be recorded in the profits and losses of the period in which they actually arise.
28. Profit distribution
The cash dividend of the Group is recognized as liabilities after the approval of general meeting of stockholders.
29. Safety fund
The safety fund extracted by the Group shall be recognized as the cost of the related products or income statement while be
recognized as special reserve. When using safety fund it shall be distinguished whether it will form fixed assets or not. The
expenditure shall write down the special reserve; the capital expenditure shall be recognized as fixed assets when meet the expected
conditions for use and write down the special reserve while recognizing accumulated depreciation with the same amount.
30. Fair value measurement
The Group measures its equity investments at fair value at the end of each reporting period. Fair value is the price that would be
received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either
in the principal market for the asset or liability or in the absence of a principal market in the most advantageous market for the asset
or liability. The principal or the most advantageous market must be accessible by the Group. The fair value of an asset or a liability is
measured using the assumptions that market participants would use when pricing the asset or liability assuming that market
participants act in their economic best interest.
A fair value measurement of a non-financial asset takes into account a market participant’s ability to generate economic benefits by
using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best
use.The Group uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure
fair value maximising the use of relevant observable inputs and minimising the use of unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the fair value
hierarchy described as follows based on the lowest level input that is significant to the fair value measurement as a whole: Level 1 –
based on quoted prices (unadjusted) in active markets for identical assets or liabilities; Level 2 – based on valuation techniques for
which the lowest level input that is significant to the fair value measurement is observable either directly or indirectly; Level 3 –
based on valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable
For assets and liabilities that are recognised in the financial statements on a recurring basis the Group determines whether transfers
have occurred between levels in the hierarchy by reassessing categorisation (based on the lowest level input that is significant to the
fair value measurement as a whole) at the end of each reporting period.
31. Significant accounting judgments and estimates
The preparation of financial statements requires management to make judgments estimates and assumptions that affect the amounts
and disclosures of revenues expenses assets and liabilities and the disclosure of contingent liabilities at the balance sheet date.However uncertainty about these assumptions and estimates could result in outcomes that could require a material adjustment to the
carrying amounts of the assets or liabilities affected in the future.Judgments
In the process of applying the Group’s accounting policies management has made the following judgments which have significant
effect on the financial statements:
Operating leases - as lessor
The Group has entered into commercial property leases on its investment property portfolio. The Group has determined based on an
evaluation of the terms and conditions of the arrangements that it retains all the significant risks and rewards of ownership of these
properties which are leased out on operating leases.Uncertainty of accounting estimates
The following are the key assumptions about the future on the balance sheet date and other key sources of uncertainty in estimating
assets and liabilities that may lead to significant adjustments in the book value of assets and liabilities in future accounting periods.Impairment of available-for-sale
Prior to January 1 2019 the Group classified certain assets as financial assets for sale and included changes in their fair value
directly in other comprehensive earnings. When the fair value falls management assumes that the value falls to determine whether
there is a loss of impairment that needs to be recognized in the profits and losses.Impairment of financial instruments
The Group uses the anticipated credit loss model to evaluate the impairment of financial instruments. The application of the
anticipated credit loss model needs to make significant judgments and estimates taking into account all reasonable and reliable
information including forward-looking information. In making such judgments and estimates the Group infers the expected changes
in the debtor's credit risk based on historical repayment data combined with economic policies macroeconomic indicators industry
risks and other factors.Impairment of non-current assets other than financial assets (goodwill excluded)
The Group assesses at each reporting date whether there is an indication that non-current assets other than financial assets may be
impaired. If there is any sign of possible assets impairment the assets concerned should be subject to impairment test. When the
carrying amount of an asset or the relevant assets group exceeds its recoverable amount which is the higher one of the net amount of
the fair value of the asset minus the disposal expenses and the present value of the expected future cash flow of the asset the asset is
considered impaired. The fair value minus the disposal expenses is determined by reference to the recent market transactions price or
observed market price less any directly attributable expenditure for disposing. When making an estimate of the present value of the
future cash flow of an asset the Group should estimate the future cash flows of the asset or the relevant assets group with the
appropriate discount rate selected to reflect the present value of the future cash flows.
Bad debt provisions
Provisions are made under the allowance method. For each individually significant receivable the impairment test should be
conducted individually. Where there is evidence that indicates impairment the loss should be recognized with the respective
provision accrued equaling to the difference between the present value of the future cash flows and the book value of receivables.
For other receivables concerned management should accrue the general provisions along with the receivables individually tested
while no impairment incurred taking in account the collectability.Inventory impairment based on the net realizable value
According to accounting policy inventories shall be measured at the lower of cost and the net realizable value. Provision for
inventories is recognized in the income statement when the cost is higher than the net realizable value and when the inventories are
obsolete and slow-moving. The Group will reassess whether a single inventory is obsolete slow-moving or whether the net realizable
value is lower than the inventories’ cost at end of each year.
Development expenditures
When determining the capitalization amount management should make assumptions such as the expected cash flows of the assets
related the applicable discount rate and expected benefit period.
Deferred tax assets
The Group should recognize the deferred income tax assets arising from all the existing unutilized tax deficits and deductible
temporary differences to the extent of the amount of the taxable income which it is most likely to obtain and which can be deducted
from the deductible temporary differences. Enormous accounting judgments as well as the tax planning are compulsory for
management to estimate the time and amount of prospective taxable profits and thus determine the appropriate amount of the
deferred tax assets concerned.Warranty
The Group provides warranties on automobile and undertakes to repair or replace items that fail to perform satisfactorily based on
certain pre-determined conditions. Factors that influence estimation of related warranty claim include: 1) renewal of laws and
regulations; 2) quality promotion of Group products; 3) change of parts and labour cost. In general the Group records warranty based
on selling volume and estimated compensatory unit warranty cost deduction multi-agreed compensation from suppliers. As at
balance sheet day the Group launches retrospective analysis on warranty carrying amount in consideration of accrual warranty
payment during relative warranty period and recent trends of product renovation and replacement and further adjustment if
necessary. Any increase or decrease in the provision would affect profit or loss in future years.
Depreciation and amortization
The Group’s management determines the estimated useful lives and residual value of fixed assets and intangible assets. This estimate
is based on the historical experience of actual useful lives of fixed assets and intangible assets of similar nature and functions.Management will increase the depreciation and amortization charges where useful lives are less than previously estimated.
32. Changes in accounting policies and estimates
Changes in accounting policies
In 2017 the Ministry of Finance promulgated revised Accounting Standards for Enterprises No. 22 - Recognition and Measurement of Financial
Instruments Accounting Standards for Enterprises No. 23 - Transfer of Financial Assets Accounting Standards for Enterprises No. 24 - Hedging
and Accounting Standards for Enterprises No. 37 - Presentation of Financial Instruments (abbreviated as "New Financial Workers"). Since
January 1 2019 the Group has carried out accounting treatment in accordance with the newly revised above-mentioned standards. According to
the cohesion rules the information during the comparable period is not adjusted.New Financial Instrument Guidelines
The new financial instrument standards have changed the classification and measurement methods of financial assets and identified three main
measurement categories: amortized cost; fair value measurement and its changes are included in other comprehensive income; fair value
measurement and its changes are included in current profits and losses. Enterprises need to consider their own business model as well as the
characteristics of contractual cash flow of financial assets for the above classification. Equity instrument investment should be measured at fair
value and its changes should be included in current profits and losses. However when initial confirmation is made non-tradable equity
instrument investment can be irrevocably designated as a financial asset measured at fair value and its changes should be included in other
comprehensive income.The new financial instrument standard requires that the measurement of impairment of financial assets be changed from "the model of loss
incurred" to "the model of anticipated credit loss" which is applicable to financial assets measured at amortized cost financial assets measured
at fair value and whose changes are included in other comprehensive gains as well as loan commitments and financial guarantee contracts.
After January 1 2019 the Group designated some of its equity investments as financial assets measured at fair value and included their changes
in other comprehensive income and reported them as investments in other equity instruments.On the first execution day financial assets are classified and measured according to the revised and revised financial instrument recognition and
measurement standards. The results are as follows:
The group and the Company
Before the prevision
After the prevision
Category Book Value
Category Book Value
Equity
Investment
Measured at fair
value and
recorded in other
combined
earnings (assets
available for sale)
1957873311.31
Measured at fair value and
recorded in current profits
and losses (transactional
financial assets)
1530321311.31
Measured at fair value and
its changes are included in
other comprehensive
earnings (investment in
other equity instruments)
427552000.00
Report item changes
The company prepares the semi-annual financial statements for 2019 according to the financial statement format stipulated in Accounting No. 6
and its interpretation divides the "notes receivable and accounts receivable" in the balance sheet into "notes receivable" and "accounts
receivable" presentation and "notes payable and accounts payable" into "notes payable" and "accounts payable". The Group has retrospectively
adjusted the comparative data accordingly.VI. Taxes
1. The major categories of taxes and surcharges
Categories of taxes and surcharges Basis of tax Tax rate
Value added tax (“VAT”)
Levy on the taxable sales
and rendering of services
deducted the deductible
input VAT.
5%、6%、9%(10%)或 13%(16%)
Note: The taxable income shall be calculated at
the tax rate of 16% or 10% before April 1
2019. The taxable income shall be calculated at
the rate of 13% or 9% from April 1 2019.
Consumption tax Taxable sales 1% 3% or5%
City maintenance and construction tax The turnover taxes paid 5% or7%
Educational surcharge The turnover taxes paid 3%
Local educational surcharge The turnover taxes paid 2%
Corporate income tax Taxable income 15% or25%
2. Tax benefits
In accordance to Circular for Further Implementation of Tax Incentives In the Development of Western Regions (Cai Shui [2011] No.
58) collectively issued by the ministry of Finance the Customs General Administration and the National Taxation Bureau of PRC
from 1 January 2011 to 31 December 2020 enterprises located in the Western Region and engaged in encouraged business would be
entitled to a preferential CIT rate of 15%. For the year ended 2017 the Company Changan Special Sales and Chongqing Changan
Automobile Supporting are qualified to the requirement and acquired permission of the preferential tax rate of 15% from Chongqing
Jiangbei National Tax Bureau (refer to Jiang Fa Gai Ti[2015] No. 135).In accordance to Circular of the Administrative Measures for the Certification of New and High Technology Enterprises (Guo Ke Fa
Huo [2016] No. 32) and Circular of the Working Guidance on the Recognition of Hi-tech Enterprises (Guo Ke Fa Huo [2016] No.
195) the subsidiary of Hefei Changan Automobile Co. Ltd. obtained the certificate of new and high technology enterprise on 21
October 2016 and is subjected to the preferential tax rate of 15% from 2016 to 2018. This year we have submitted a review of the
qualifications of high-tech enterprises. It is expected to be approved in the near future. From 2019 to 2021 we will continue to enjoy
the 15% corporate income tax preferential policy for high-tech enterprises.In accordance to Circular of the Administrative Measures for the Certification of New and High Technology Enterprises (Guo Ke Fa
Huo [2016] No. 32) and Circular of the Working Guidance on the Recognition of Hi-tech Enterprises (Guo Ke Fa Huo [2016] No.
195) the subsidiaries of Hebei Changan Automobile Co. Ltd. and Hebei Baoding Changan Bus Co. Ltd. obtained the certificate of
new and high technology enterprise on 21 July 2017 and on 27 October 2017 and are subjected to the preferential tax rate of 15%
from 2017 to 2019.VII. Notes to the consolidated financial statements
1. Cash and cash equivalents
In RMB Yuan
Item Ending Beginning
Cash 17875.99 14374.84
Cash at bank 10147589137.30 9648139239.96
Other cash 387677879.26 332390911.34
Total 10535284892.55 9980544526.14
As at 30 June 2019 the book value of restricted cash and cash equivalents is RMB 387677879.26 which was mainly restricted for
the issuance of acceptance bill.
As at 30 June 2019 the cash at bank oversea is equivalent to RMB 237146846.03.
2. Transactional financial assets (Applicable from January 1 2019)
Item Ending
Financial assets measured at fair value through profit or loss 1570658462.58
Total 1570658462.58
3. Notes receivable
(1) Classification of notes receivable
In RMB Yuan
Type Ending Beginning
Commercial acceptance bill 2243353649.97 6687321419.20
Bank acceptance bill 13403314490.76 13874304386.04
Total 15646668140.73 20561625805.24
(2) The notes receivable pledged as follows:
Type 30 June 2019 31 December 2018
Commercial acceptance bill 266141440.00 384462570.00
Bank acceptance bill 16562835.96 85160000.00
Total 282704275.96 469622570.00
The bank acceptance bill of the above amount has been pledged for the notereceivable on 30 June 2019 and 31 December 2018.
(3) Endorsed or discounted but unexpired notes receivable as at the end of reporting period are as follows:
In RMB Yuan
Type
Ending Beginning
Derecognition Un-derecognition Derecognition Un-derecognition
Commercial acceptance bill 153040000.00 - 147853740.00 -
Bank acceptance bill 3839509514.21 - 1498687956.97 -
Total 3992549514.21 - 1646541696.97 -
4. Accounts receivable
(1) Disclosure of accounts receivable
In RMB Yuan
Item
2019
Balance Provision
Amount % Amount %
Single item assessment credit expected
credit loss provision for bad debts
89833683.79 4.26 62917348.77 70.04
Assess bad debt provision for expected
credit expected loss according to credit
risk characteristics combination
2020132181.21 95.74 35077754.37 1.74
Total 2109965865.00 100.00 97995103.14 4.64
Item
2018
Balance Provision
Amount % Amount %
Individually significant items and
analyzed individually for provision
858892602.36 57.26 44226423.35 5.15
Accounts receivable analyzed as groups for provision
Group 1. Accounts receivable analyzed
for provision according to aging
analysis
427323980.23 28.48 29225702.47 6.84
Group 2. Accounts receivable from
related parties
185492616.70 12.37 - -
Group subtotal 612816596.93 40.85 29225702.47 4.77
Individually insignificant items but
analyzed individually for provision
28324721.11 1.89 17162194.08 60.59
Total 1500033920.40 100 90614319.90 6.04
On June 30 2019 the accounts receivable for single provision for bad debts were as follows:
In RMB Yuan
Serial No. Balance Provision
Expected
credit loss
rate
Reason
1 39138955.35 12236785.13 31.26
Dealers caused by foreign exchange control
are not well paid
2 24025073.81 24025073.81 100.00
The company’s legal affairs have been
prosecuted and the case is under way.
3 6119941.69 6119941.69 100.00 Customer has gone bankrupt.
Others 20549712.94 20535548.14 99.93 Customer bankruptcy etc.Total 89833683.79 62917348.77 70.04
The Group's expected credit loss portfolio based on credit risk assessment is as follows:
In RMB Yuan
Aging Estimated book balance for default Expected credit loss rate
Expected credit loss for the
entire life
Within 1 year 1883415093.97 0.09 1695169.14
1 to 2 years 50443014.41 2.92 1470491.10
2 to 3 years 30065004.51 21.91 6585758.27
3 to 4 years 24837623.29 6.97 1731489.45
4 to 5 years 3616303.48 46.09 1666832.90
Over 5 years 27755141.55 79.01 21928013.51
Total 2020132181.21 1.74 35077754.37
(2) On June 30 2019 the top five accounts receivable totaled RMB 1028011275.44 accounting for 48.73% of the total
accounts receivable (2018: RMB 564688036.12 accounting for 37.65% of the total accounts receivable).
(3) Provision for bad debts withdrawn recovered or reversed in the current period
Category
Opening
Balance
Current change amount
Ending Balance
Accrual Turn back Write off
Accounts receivable bad debt provision 90614319.90 7447883.24 67100.00 97995103.14
Total 90614319.90 7447883.24 67100.00 97995103.14
(4) From January to June 2019 the group has no accounts receivable as a termination of financial assets transfer (2018:
none).
5. Prepayments
(1) An aged analysis of the prepayments is as follows:
In RMB Yuan
Aging
Ending Beginning
Amount % Amount %
Within 1 year 828207088.93 79.84 781698728.24 90.25
1 to 2 years 207186837.75 19.97 77209604.94 8.91
2 to 3 years 30535.49 - 5320836.56 0.61
Over 3 years 2020579.77 0.19 2020579.77 0.23
Total 1037445041.94 100.00 866249749.51 100.00
As at 30 June 2019 the total amount of the top five prepayments was RMB 818823877.64 accounting for 78.93% of the total
amount of prepayments (2017: RMB 692025641.94 accounting for 79.89%).
6. Other receivables
In RMB Yuan
Item Ending Beginning
Interest receivable 4581253.52 17432805.54
Dividend receivable 74897909.69
Other receivables 3429425829.02 3233020118.16
合计 3508904992.23 3250452923.70
Interest receivable
In RMB Yuan
Item Ending Beginning
Fixed deposits 4581253.52 17432805.54
Dividend receivable
Item Beginning
Increased in
this period
Reduced in
this period
Ending
Reason for not
recovering
Whether the
relevant
amount is
impaired
Dividends
receivable within
one year
- 74897909.69 - 74897909.69
No
Total 74897909.69 74897909.69 -- --
Other receivables
(1) The changes in bad debt provision for other receivables based on 12-month expected credit losses and the entire lifetime
expected credit losses are as follows (2019 only):
In RMB Yuan
Bad debt preparation
first stage second stage third stage
Total
Expected credit
losses in the next
12 months
Expected credit loss
for the entire
duration (single
assessment)
Expected credit loss
for the entire
duration
(combination
assessment)
Balance on January 1 2019 290391.47 6635181.42 922590.69 7848163.58
The balance of January 1 2019 is
in this issue.- - - -
-- Transfer to the second stage -29326.52 29326.52 -
-- Transfer to the third stage -
- Turn back to the second stage -
- Turn back to the first stage -
Current accrual 2949736.83 17325.21 2967062.04
Return this issue 818111.62 818111.62
Resale in the current period -
Write-off of this period -
Other changes -
Total 261064.95 9584918.25 151130.80 9997114.00
The changes in the book balance of other receivables are as follows:
Book balance
first stage second stage third stage
Total
Expected credit
losses in the next
12 months
Expected credit
loss for the entire
duration (single
Expected credit
loss for the entire
duration
assessment) (combination
assessment)
Balance on January 1 2019 3224559978.75 6635181.42 5738281.45 3236933441.62
The balance of January 1 2019 is
in this issue.- - - -
-- Transfer to the second stage -586530.34 586530.34 -
-- Transfer to the third stage -
- Turn back to the second stage -
- Turn back to the first stage -
New in this issue 195035459.71 2949736.83 13121060.07 211106256.61
Termination confirmation 8616755.21 8616755.21
Write-off of this period -
Other changes -
Total 3419008908.12 9584918.25 10829116.65 3439422943.02
Other receivables are indicated by type (2018 only):
In RMB Yuan
Type
Beginning
Book balance Bad debt preparation
Amount % Amount %
Other receivables with significant single amount and single
provision for bad debts
2780889774.62 85.80 -
Other receivables with provision for bad debts by combination
Combination 1. Other receivables with provision for bad debts
by aging analysis
323279832.19 9.98 1212982.16 0.38
Combination 2. Other receivables with provision for bad debts
by related parties
126128653.39 3.89 -
Combined subtotal 449408485.58 13.87 1212982.16 0.27
Other receivables that are not significant in individual amount
but are individually provisioned for bad debts
10570021.54 0.33 6635181.42 62.77
Total 3240868281.74 100.00 7848163.58 0.24
(2) From January to June 2019 provision for bad debts was RMB 2967062.04 (2018: RMB 576587.36 was accrued and bad
debt provision increased by RMB 4348209.00 due to the acquisition of Changan Suzuki) and the provision for bad debts
was RMB 818111.62 (2018 : RMB 1176673.66).
(3) The other accounts receivable actually written off from January to June 2019 were RMB 0 (2018: RMB 56554.80).
(4) From January to June 2019 the group has no other receivables as a termination of financial assets transfer (2018: none).
(5) Top five debtors of other receivables are as follows:
In RMB Yuan
Debtors Ending balance Years
Proportion of total other
receivables (%)
First 1865146017.60 Within 4 years 54.23
Second 702085026.74 Within 4 years 20.41
Third 315259435.40 Within 3 years 9.17
Fourth 124312677.99 Within 1 year 3.61
Fifth 91385460.00 Within 2 years 2.66
Total 3098188617.73 - 90.08
7. Inventory
(1) Classification of inventory
In RMB Yuan
Item
Ending Beginning
Balance Provision Net value Balance Provision Net value
Raw materials 1389922376.25 203070981.68 1186851394.57 2029706541.33 181897353.27 1847809188.06
Work in transit 103745221.41 - 103745221.41 318420244.84 - 318420244.84
Work in progress 832526220.55 27231163.66 805295056.89 1413892484.38 35473526.73 1378418957.65
Commodity stock 3737132783.85 167615041.67 3569517742.18 1292509122.51 76519657.33 1215989465.18
Revolving materials - - - 110310364.86 - 110310364.86
Spare parts 39966722.21 - 39966722.21 46472236.60 - 46472236.60
Total 6103293324.27 397917187.01 5705376137.26 5211310994.52 293890537.33 4917420457.19
(2) Provision for inventory
In RMB Yuan
Type Beginning Provision
Deduction
Ending
Reversal Write-off
Raw materials 181897353.27 45654482.92 20374619.52 4106234.99 203070981.68
Work in progress 35473526.73 1330008.90 - 9572371.97 27231163.66
Commodity stock 76519657.33 126266125.80 199460.04 34971281.42 167615041.67
Total 293890537.33 173250617.62 20574079.56 48649888.38 397917187.01
8. Other current assets
In RMB Yuan
Item Ending Beginning
Accrual input tax 2064442729.98 2227386063.11
Others 322190601.41 179290.12
Total 2386633331.39 2227565353.23
9. Available-for-sale financial assets (2018 only)
In RMB Yuan
Item Ending Beginning
Available-for-sale equity securites
Measured at fair value - 1530321311.31
Measured by cost - 427552000.00
Total - 1957873311.31
In 2017 the Ministry of Finance successively revised and issued the "Accounting Standards for Business Enterprises No. 37 -
Presentation of Financial Instruments" "Accounting Standards for Business Enterprises No. 22 - Recognition and Measurement of
Financial Instruments" and Accounting Standards for Business Enterprises No. 23 - Financial Assets Relevant guidelines for
financial instruments such as Transfer. According to regulations the company has implemented the new financial instruments
standard since January 1 2019 and reclassified available-for-sale financial assets into trading financial assets and other equity
instruments.
10. Other equity instrument investments (applicable from January 1 2019)
Invested unit
Opening
balance
Initial
impairment
provision
Increased this
year
Reduced
this year
Ending balance
Final
impairment
provision
%
Weapon Equipment Group
Finance Co. Ltd.
157020800.00
157020800.00
3.83
Sichuan Glass Co. Ltd
1809274.00
1809274.00 1809274.00 0.60
Zhongfa Lian Investment Co.Ltd.
21000000.00
21000000.00
10.37
Chongqing Ante Import and
Export Trade Co. Ltd.
3000000.00
3000000.00
10.00
Guoqi (Beijing) Automotive
Lightweight Technology
Research Institute Co. Ltd.
3000000.00
3000000.00
6.90
Guolian Automotive Power
Battery Research Luyuan Co.
Ltd.
40000000.00
40000000.00
7.41
Zhonghui Futong Financial
30552000.00
30552000.00
5.00
Leasing (Shenzhen) Co. Ltd.Keliyuan Hybrid Power
Technology Co. Ltd.
200000000.00
200000000.00
9.24
Guoqi (Beijing) Intelligent
Network Association Automotive
Research Institute Co. Ltd.
50000000.00
50000000.00
5.56
Total - - 506382074.00 - 506382074.00 1809274.00
11. Long-term equity investment
In RMB Yuan
Investee
Accounting
method
Initial amount Beginning
Addition/
(deduction)
Ending
Shareholding
percentage (%)
Voting
percentage
(%)
Explanation for the
difference between
shareholding
percentage and
voting percentage
Impairment
Current
provision
Current cash
dividends
1.Joint ventures
Jiangling Holdings Co. Ltd. Equity 1008511522.00 2493754915.53 -236679161.41 2257075754.12 50.00% 50.00% - - - -
Changan Ford Motor Co. Ltd. Equity 975232926.29 3709784507.11 -388312379.14 3321472127.97 50.00% 50.00% - - - -
Changan Mazda Automobile Co. Ltd. Equity 1097839635.00 2472626663.41 431236189.99 2903862853.40 50.00% 50.00% - - - -
Changan Mazda Engine Co. Ltd. Equity 786734634.10 827803757.96 22279051.96 850082809.92 50.00% 50.00% - - - -
Changan Peugeot Citroen Automobile
Co. Ltd.
Equity
3807841700.00 1456519068.74 -37577002.31 1418942066.43 50.00% 50.00% - - - -
Changan Weilai New Energy
Automobile Technology Co. Ltd.
Equity
49000000.00 44065513.91 -16493522.92 27571990.99 50.00% 50.00% - - - -
2.Associates
Chongqing Changan Crossing Vehicle
Co. Ltd.
Equity
61800885.00 116588234.97 39038877.69 155627112.66 34.30% 34.30% - - - -
Chongqing Changan Cross Vehicle
Marketing Co. Ltd.
Equity
1.00 - 34.30% 34.30% - - - -
Beijing Fangan Xinyue Taxi Co. Ltd. Equity 6000000.00 - 20.70% 20.70% - - - -
Changan Automobile Finance Co. Equity 1805000000.00 2030617157.41 46724451.22 2077341608.63 28.66% 28.66% - - - -
Ltd.Hainan Anxinxing Information
Technology Co. Ltd.
Equity
6000000.00 5536555.21 -775195.24 4761359.97 30.00% 30.00% - - - -
Nanjing Chelai Travel Technology
Co. Ltd.
Equity
2000000.00 1813616.14 -238955.00 1574661.14 10.00% 10.00% - - - -
Hunan Guoxin Semiconductor
Technology Co. Ltd.
Equity
25000000.00 25000000.00 -145569.13 24854430.87 25.00% 25.00% - - - -
Anhe (Chongqing) Equity Investment
Fund Management Co. Ltd.
Equity
2500000.00 2500000.00 -166798.94 2333201.06 25.00% 25.00% - - - -
Hangzhou Chelizi Intelligent
Technology Co. Ltd.
Equity
2243750.00 2703275.87 852500.11 3555775.98 20.00% 20.00% - - - -
Nanjing Leading Equity Investment
Partnership
Equity
858267717.00 846264828.30 846264828.30 16.39% 16.39% - - - -
Nanjing Lingxing Equity Investment
Management Co. Ltd.
Equity 1500000.00 1500000.00 1500000.00 15.00% 15.00%
other Equity 98000000.00 85856852.57 -30974217.80 54882634.77 49.00% 49.00%
Total --
10593472770.3
9
13275170118.8
3
676533097.38 13951703216.2
1
-- -- -- -- --
12. Investment property
According to the cost of the investment real estate
In RMB Yuan
Item Beginning Addition Deduction Ending
I. Original cost 10050100.00 10050100.00
Buildings 10050100.00 10050100.00
II. Accumulated depreciationand
amortization
2720538.72 113355.78 2833894.50
Buildings 2720538.72 113355.78 2833894.50
III. Net Value 7329561.28 -113355.78 7216205.50
Buildings 7329561.28 -113355.78 7216205.50
IV. Impairment Provision 7329561.28 -113355.78 7216205.50
Buildings 7329561.28 -113355.78 7216205.50
13. Fixed assets
Beginning Ending
Fixed assets 23096697122.71 22161054058.31
Fixed assets cleanup
total 23096697122.71 22161054058.31
Fixed assets
In RMB Yuan
Item Beginning Addition Deduction Ending
I. Original cost 40674248814.18 2346338248.66 8490208.62 43012096854.22
Buildings 9889579515.34 88520701.41 2725898.44 9975374318.31
Machinery 21927380270.82 965242220.50 689154.17 22891933337.15
Vehicles 1213223699.56 513755057.84 487730.25 1726491027.15
Other Equipments 7644065328.46 778820268.91 4587425.76 8418298171.61
II. Accumulated
depreciation
17352600109.49 1412812879.82 5947502.87 18759465486.44
Buildings 2147206657.32 153514251.20 808226.36 2299912682.16
Machinery 11026127942.23 711495302.76 645979.80 11736977265.19
Vehicles 405520581.39 278918455.42 189329.30 684249707.51
Other Equipments 3773744928.55 268884870.44 4303967.41 4038325831.58
III. Net Value 23321648704.69 933525368.84 2542705.75 24252631367.78
Buildings 7742372858.02 -64993549.79 1917672.08 7675461636.15
Machinery 10901252328.59 253746917.74 43174.37 11154956071.96
Vehicles 807703118.17 234836602.42 298400.95 1042241319.64
Other Equipments 3870320399.91 509935398.47 283458.35 4379972340.03
IV.Impairment Provision 1160594646.38 - 4660401.31 1155934245.07
Buildings 82452249.51 - 82452249.51
Machinery 895917567.96 - 265375.48 895652192.48
Vehicles 36271972.06 - 36271972.06
Other Equipments 145952856.85 - 4395025.83 141557831.02
V. Book Value 22161054058.31 933525368.84 -2117695.56 23096697122.71
Buildings 7659920608.51 -64993549.79 1917672.08 7593009386.64
Machinery 10005334760.63 253746917.74 -222201.11 10259303879.48
Vehicles 771431146.11 234836602.42 298400.95 1005969347.58
Other Equipments 3724367543.06 509935398.47 -4111567.48 4238414509.01
The depreciation during the reporting period is RMB 1412812879.82. During the period the construction in progress amounting to RMB
2332323509.58 is transferred to the fixed asset.
14. Construction in progress
(1) Details of construction in progress
In RMB Yuan
Item
Closing balance Openning balance
Balance Provision Book value Balance Provision Book value
Mini-bus production
equipment
218182423.55 218182423.55 815889070.57 - 815889070.57
Yuzui motor city project 5981953.14 5981953.14 51962876.25 - 51962876.25
Car production equipment 243224594.25 243224594.25 181137313.03 - 181137313.03
Engine plant 1909833300.91 1909833300.91 1458726257.58 - 1458726257.58
Vehicle research institution 950213737.56 950213737.56 854570879.08 - 854570879.08
Vehicle moulds 343625680.95 343625680.95 420284566.37 - 420284566.37
Light vehicle technical
transformation project of
Baoding Changan bus
60153349.31 60153349.31 83207252.58 - 83207252.58
Plant for vehicle test project 920000.00 920000.00 6643182.68 - 6643182.68
Beijing vehicle construction
project
118804482.72 118804482.72 98585664.59 - 98585664.59
Engine Base of Nanjing - - 499150.94 - 499150.94
Yuzui Refitting factory 12276085.40 12276085.40 12276085.40 - 12276085.40
Car production Project Of
Hefei Changan
934063696.44 934063696.44 872832482.14 - 872832482.14
Others 430505435.17
4931539
4.88
381190040.29 576544644.42
4931539
4.88
527229249.54
Total
5227784739.40 4931539
4.88
5178469344.52 5433159425.63 4931539
4.88
5383844030.75
(2) Movement of major construction in progress projects
In RMB Yuan
Item Beginning Addition
Transferred to fixed
assets
Deduction Ending
Mini-bus production
equipment
815889070.57 531757827.46 1129464474.48 - 218182423.55
Yuzui motor city project 51962876.25 54169722.66 100150645.77 - 5981953.14
Car production equipment 181137313.03 72616133.72 10528852.50 - 243224594.25
Engine plant 1458726257.58 609155139.77 158048096.44 - 1909833300.91
Vehicle research institution 854570879.08 165954927.63 70280881.12 31188.03 950213737.56
Vehicle moulds 420284566.37 52636717.80 129295603.22 - 343625680.95
Light vehicle technical
transformation project of
Baoding Changan bus
83207252.58 8277205.78 31331109.05 60153349.31
Plant for vehicle test project 6643182.68 1429248.10 7131898.78 20532.00 920000.00
Beijing vehicle construction
project
98585664.59 63099651.54 42880833.41 118804482.72
Engine Base of Nanjing 499150.94 41509.43 540660.37
Yuzui Refitting factory 12276085.40 12276085.40
Car production Project Of
Hefei Changan
872832482.14 188092832.10 126861617.80 934063696.44
Others 527229249.54 379771109.56 525808836.64 1482.17 381190040.29
Total 5383844030.75 2127002025.55 2332323509.58 53202.20 5178469344.52
(3) Provision for impairment of construction in progress
On June 30 2019 the balance of impairment provision for construction in progress was 49315394.88 yuan. There was no accrued
or resold amount in the current year. (In 2018 Changan Suzuki was acquired and the provision for impairment of construction in
progress increased by RMB 49315394.88).
15. Intangible assets
Details of intangible assets
In RMB Yuan
Item Beginning Addition Deduction Ending
I. Original cost 9226222538.41 624420788.46 - 9850643326.87
Land use rights 2753082390.28 - - 2753082390.28
Software use rights 632418610.26 7717112.61 - 640135722.87
Trademark use rights 211784400.00 - 211784400.00
Non-patent technology 5628937137.87 616703675.85 - 6245640813.72
II. Accumulated amortization 3978633979.12 485234277.39 - 4463868256.51
Land use rights 403454284.03 30222421.91 - 433676705.94
Software use rights 510503061.87 20642786.11 - 531145847.98
Trademark use rights 170953466.62 8763934.35 - 179717400.97
Non-patent technology 2893723166.60 425605135.02 - 3319328301.62
III. Net value 5247588559.29 139186511.07 - 5386775070.36
Land use rights 2349628106.25 -30222421.91 - 2319405684.34
Software use rights 121915548.39 -12925673.50 - 108989874.89
Trademark use rights 40830933.38 -8763934.35 - 32066999.03
Non-patent technology 2735213971.27 191098540.83 - 2926312512.10
IV. Impairment provision 229345006.49 - 229345006.49
Land use rights 2298118.36 2298118.36
Software use rights 21319804.81 - - 21319804.81
Non-patent technology 205727083.32 - 205727083.32
V. Book value 5018243552.80 139186511.07 5157430063.87
Land use rights 2347329987.89 -30222421.91 - 2317107565.98
Software use rights 100595743.58 -12925673.50 - 87670070.08
Trademark use rights 40830933.38 -8763934.35 - 32066999.03
Non-patent technology 2529486887.95 191098540.83 2720585428.78
As at 30 June 2019 the intangible assets from internal research and development account for 52.75% of total
intangible assets.
16. Development expenditure
In RMB Yuan
Item Beginning Addition Deduction
Charged to income
Statement of the
Current period
Charged to income
Statement of the Current
period
Ending
Automobile
Development
789597615.60 663276329.42 76047969.60 616643965.02 760182010.40
Total 789597615.60 663276329.42 76047969.60 616643965.02 760182010.40
17. Goodwill
In RMB Yuan
Investee Beginning Addition Deduction Ending
Impairment
provision
Hebei Changan Automobile Co. Ltd 9804394.00 9804394.00
Nanjing Changan Automobile Co. Ltd 73465335.00
Total 9804394.00 9804394.00 73465335.00
18. Long-term deferred expenses
In RMB Yuan
Item Beginning Addition Amortization Other deduction Ending
Long-term deferred expenses 17104601.67 1913020.99 2285013.79 494853.46 16237755.41
Total 17104601.67 1913020.99 2285013.79 494853.46 16237755.41
19. Deferred tax assets and liabilities
Recognized deferred tax assets and liabilities:
In RMB Yuan
Item Ending Beginning
Deferred tax assets:
Provision for the impairment of assets 195028800.31 178931389.28
Accrued expenses and contingent liabilities 759225831.00 863293314.33
Unpaid tech development expense and
advertisement expense
101258288.44 71636763.88
Deferred income 472108267.04 467502076.45
Unpaid salary and bonus and others 36106817.82 74190894.95
Subtotal 1563728004.61 1655554438.89
Deferred tax liabilities:
Changes in fair value of available-for-sale financial 76116073.54
assets
Changes in fair value of trading financial assets 82166646.24
Fair value adjustment of business combination not
under the same control
46310587.95 59115097.05
Subtotal 128477234.19 135231170.59
20. Provision for the impairment of assets
In RMB Yuan
Item Beginning
Addition Deduction
Ending
Current accrual
Other increase Reversal Write-off Other
reduction
I. Bad debt
provision
98462483.48 10414945.28 885211.62 107992217.14
II. Provision for
obsolete
inventory
293890537.33 173250617.62 20574079.56 48649888.38 397917187.01
III. Provision for
the impairment
of fixed assets
1160594646.38 4660401.31 1155934245.07
IV. Provision for
the impairment
of intangible
assets
229345006.49 229345006.49
V. Provision for
the impairment
of goodwill
73465335.00 73465335.00
VI. Provision for
the impairment
of
available-for-sale
financial assets
49315394.88 49315394.88
VII. Provision
for impairment
of
available-for-sale
financial assets
28929274.00 28929274.00
VIII. Other
equity
instruments
1809274.00 1809274.00
investment
impairment
provision
Total 1934002677.56 183665562.90 1809274.00 21459291.18 53310289.69 28929274.00 2015778659.59
21. Short-term loans
In RMB Yuan
Item Ending Beginning
Pledge loans 60000000.00 40000000.00
Guaranteed loans -
Credit loans 150000000.00 150000000.00
Total 210000000.00 190000000.00
22. Notes payable
In RMB Yuan
Item Ending Beginning
Commercial acceptance bill 2946482019.96
Bank acceptance bill 13769475508.94 11861380242.43
Total 13769475508.94 14807862262.39
23. Accounts payable
In RMB Yuan
Item Ending Beginning
Accounts payable 14276660036.85 13916201276.95
total 14276660036.85 13916201276.95
24. Advances from customers
In RMB Yuan
Item Ending Beginning
Advances from customers 2956683361.56 1556482278.92
total 2956683361.56 1556482278.92
25. Payroll payable
30 June 2019
In RMB Yuan
Item Beginning Addition Deduction Ending
Short term salary benefits 1271461842.35 2009984286.64 2666995493.94 614450635.05
Defined contribution plans 84410435.21 246314325.96 244459768.83 86264992.34
Early retirement benefits 7123000.00 11946648.33 1152264.23 17917384.10
Total 1362995277.56 2268245260.93 2912607527.00 718633011.49
Short term salary benefits as follows:
30 June 2019
In RMB Yuan
Item Beginning Addition Deduction Ending
Salary bonus allowance
and subsidy
1077447577.69 1484593041.13 2195561155.16 366479463.66
Employee benefit 45611590.61 78079279.84 75656837.51 48034032.94
Social insurance 3379369.66 236358091.76 234957718.01 4779743.41
Housing accumulation fund 9422677.58 146465413.34 146605427.98 9282662.94
Labor fund and employee
education fund
135600626.81 64488460.57 14214355.28 185874732.10
Total 1271461842.35 2009984286.64 2666995493.94 614450635.05
Defined contribution plans as follows:
30 June 2019
In RMB Yuan
Item Beginning Addition Deduction Ending
Basic retirement
security
76517169.90 239621331.31 237709806.47 78428694.74
Unemployment
insurance
7893265.31 6692994.65 6749962.36 7836297.60
Total 84410435.21 246314325.96 244459768.83 86264992.34
26. Taxes payable
In RMB Yuan
Item Ending Beginning
Value-added tax 5159464.47 9641450.47
Consumption tax 239049926.42 658869177.63
Corporate income tax 30437097.13 -19968952.37
Individual Income tax 1463366.34 655007.28
City maintenance and construction tax education 4504831.21 9333772.54
additional expenses
Others 10528738.80 10786031.70
Total 291143424.37 669316487.25
27. Other payables
Item Ending Beginning
Dividend payable 86527416.00 79742.80
Other payables 5078870846.95 3079669273.01
合计 5165398262.95 3079749015.81
Dividend payable
In RMB Yuan
Item Ending Beginning
Dividend payable – A share dividend 86447673.20
Dividend payable – Hebei Changan Minority
interests
79742.80 79742.80
Total 86527416.00 79742.80
Other payables
In RMB Yuan
Item Ending Beginning
Deposits of dealer and supplier 1791134921.16 133434563.54
Maintenance fees 146266708.47 205714188.51
Advertising fees 452999910.77 750771372.18
Warehousing and transport fees 267088420.59 123222758.15
Integrated service charges and miscellaneous
expenses
207668516.93 110960485.47
Purchase and construction of fixed assets
intangible assets and project deposits
1445922536.66 1271262272.32
Others 767789832.37 484303632.84
Total 5078870846.95 3079669273.01
28. Estimated liabilities
In RMB Yuan
Item Beginning Addition Deduction Ending
product quality assurance 2610780818.12 645442330.86 274432792.39 2981790356.59
Supplier compensation 634541926.00 24054153.63 610487772.37
Total 3245322744.12 645442330.86 298486946.02 3592278128.96
Note: The product quality assurance is the maintenance cost of the estimated three-package period of the sold vehicle.
29. Other current liabilities
In RMB Yuan
Item Ending Beginning
Accrued utilities 6088846.05 36910207.22
Accrued transportation fee 465862022.77 537462389.91
Accrued maintenance fee 28206664.07 37723105.48
Accrued technology transfer and development
fee
487062803.54 128055835.93
Accrued commercial discount payable 1834314241.41 2883344577.38
Accrued market development expense 324529202.03 443397362.38
Accrued rental fee 14182051.07 98306892.29
Accrued consultancy fee 43982256.70
Others 336405908.79 116258525.32
Total 3496651739.73 4325441152.61
30. Non-current liabilities due within one year
In RMB Yuan
Item Ending Beginning
Non-current liabilities due within one year - 6594120.00
Total - 6594120.00
31. Long-term loans
In RMB Yuan
Item Ending Beginning
Credit loan - 6594120.00
Deduction of loans due within one year - -6594120.00
Total - -
32.Long-term payables
Item Ending Beginning
Special payables 305774538.84 303590824.69
Total 305774538.84 303590824.69
Special payables
In RMB Yuan
Item Beginning Addition Deduction Ending
New car development 20684920.29 3026900.00 1747628.15 21964192.14
Changan Automobile E-type gasoline
engine cylinder block cylinder head
machine plus production line
demonstration project
22984695.64 22984695.64
Land demolition compensation 55350709.40 55350709.40
C206 pure electric vehicle development
and industrialization project
3446280.58 3446280.58
Intelligent manufacturing special
project
104783625.98 1246700.00 7339177.27 98691148.71
Lightweight design of automobile
structure
52890838.71 21000000.00 12102012.55 61788826.16
Others 43449754.09 38395377.90 17311750.14 64533381.85
Total 303590824.69 63668977.90 61485263.75 305774538.84
33. Deferred income
30 June 2019
In RMB Yuan
Item Beginning Addition Deduction Ending
Government grants related to
assets
2871932225.37 1440000.00 88821798.04 2784550427.33
Government grants related to
income
673754999.84 400000000.00 71456238.65 1002298761.19
Others 137621309.52 136155386.10 249400264.09 24376431.53
Total 3683308534.73 537595386.10 409678300.78 3811225620.05
2018
Item Beginning Addition Deduction Ending
Government grants related to
assets
2825085486.08 258126338.83 211279599.54 2871932225.37
Government grants related to
income
754048245.36 302298761.19 382592006.71 673754999.84
Others 48683687.61 142238902.00 53301280.09 137621309.52
Total 3627817419.05 702664002.02 647172886.34 3683308534.73
As at 30 June 2019 details of liabilities related to government grants are as follows:
Item Beginning Addition
Recorded to
other income
Ending
Relates to
asset/gain
Project subsidy funds 2343587752.65 1440000.00 58818721.02 2286209031.63 Related to asset
Subsidies for plant
construction
338633250.56 24748714.76 313884535.80
Related to asset
Technical innovation funds 16150000.00 16150000.00 Related to asset
Other asset - related subsidies 173561222.16 5254362.26 168306859.90 Related to asset
Other income - related
subsidies
673754999.84 400000000.00 71456238.65 1002298761.19
Related to income
Total 3545687225.21 401440000.00 160278036.69 3786849188.52
As at 31 December 2018 details of liabilities related to government grants are as follows:
Item Beginning Addition
Recorded to
non-operating income
Ending
Relates to
asset/gain
Project subsidy funds 2393683325.86 79093338.83 129188912.04 2343587752.65 Related to asset
Subsidies for plant
construction
343254680.06 44876000.00 49497429.50 338633250.56
Related to asset
Technical innovation
funds
16150000.00 16150000.00
Related to asset
Other asset - related
subsidies
71997480.16 134157000.00 32593258.00 173561222.16
Related to asset
Other income - related
subsidies
754048245.36 302298761.19 382592006.71 673754999.84 Related to
income
Total 3579133731.44 560425100.02 593871606.25 3545687225.21
34. Share capital
In RMB Yuan
Beginning
Current movement
Ending Issuance of
shares
Stock dividend
Transfer of
reserve to
common shares
others Subtotal
The sum of
shares
4802648511.00 - - - - - 4802648511.00
35. Capital reserves
In RMB Yuan
Item Beginning Addition Deduction Ending
Share premium 4938329830.94 - - 4938329830.94
Share-based payment 23961900.00 - - 23961900.00
Capital reserve transferred
arising from the old standards
44496899.00 - - 44496899.00
Restricted capital reserve of
equity investments
17015985.20 - - 17015985.20
Others 33437825.03 - - 33437825.03
Total 5057242440.17 - - 5057242440.17
36. Other comprehensive income
In RMB Yuan
Item Report period Same period of last year
1. Profits (loss) generated from available for sale financial
assets
-27690000.00
Less: Available for sale financial assets arising from income tax
effect
-4153500.00
Net - through other comprehensive income into the profits and
losses of the current
-
Subtotal -23536500.00
2. Translation differences of foreign currency financial
statements
22567848.13 -19190455.30
3. Shares in the other comprehensive income of the investee
accounted for according to the equity method
289756488.89
Total 22567848.13 247029533.59
37. Surplus reserves
In RMB Yuan
Item Beginning Addition Deduction Ending
Statutory surplus 2401324255.50 - - 2401324255.50
Total 2401324255.50 - - 2401324255.50
38. Retained earnings
In RMB Yuan
Item Sum
Retained earnings at beginning of year before adjustments 33707011170.31
Adjust the early undistributed profits total
Retained earnings at beginning of year after adjustments 33707011170.31
Add: Net profit belong to parent company -2240039761.11
Less: the statutory surplus reserves
Extract discretionary surplus reserve
Extract general risk preparation
Common stock dividends payable 86447673.20
Retained earnings at the end 31380523736.00
39. Operating revenue and cost
(1) Operating revenue and operating cost
In RMB Yuan
Item Report period Same period of last year
Operating revenue 29100899960.18 34440982013.45
Other operating revenue 774880136.66 1201850176.59
Operating cost 27419410626.92 30614845704.45
(2) Main business (divisions)
In RMB Yuan
Item
Report period Same period of last year
Operating revenue Operating cost Operating revenue Operating cost
Motor industry 29100899960.18 26869270640.75 34440982013.45 30172410492.58
Total 29100899960.18 26869270640.75 34440982013.45 30172410492.58
(3) Main business (product)
In RMB Yuan
Item
Report period Same period of last year
Operating revenue Operating cost Operating revenue Operating cost
Sale of goods 29039911031.57 26783426523.20 34368280256.20 30082686676.78
Outsourcing processing 60988928.61 85844117.55 72701757.25 89723815.80
Total 29100899960.18 26869270640.75 34440982013.45 30172410492.58
(4) Main business areas (points)
In RMB Yuan
Item
Report period Same period of last year
Operating revenue Operating cost Operating revenue Operating cost
Domestic 27640776612.07 25429548405.65 33128902612.24 28783568072.99
Overseas 1460123348.11 1439722235.10 1312079401.21 1388842419.59
Total 29100899960.18 26869270640.75 34440982013.45 30172410492.58
40. Tax and surcharges
In RMB Yuan
Item Report period Same period of last year
Consumption tax 858219663.65 1046865578.31
City maintenance and construction tax 66201215.72 81462766.85
Education additional expenses 48193289.93 60907556.48
Others 107656305.48 97679299.93
Total 1080270474.78 1286915201.57
41. Operating expenses
In RMB Yuan
Item Report period Same period of last year
Payroll and welfare 217259045.38 179109833.87
Promotional advertising fees and sales
service fees
315728251.14 1212685702.28
Transportation expenses 840974104.51 1045016389.46
Travelling expenses 39917298.97 30138418.47
Package expenses 12659730.13 30646835.90
Administrative expenses 2538568.31 2271915.34
Consulting fee 3900858.69 2347166.50
Training fee 3755007.88 15475414.33
Others 6483676.29 25770752.36
Total 1443216541.30 2543462428.51
42. General and administrative expenses
In RMB Yuan
Item Report period Same period of last year
Payroll and welfare 511834200.57 530842721.95
Administrative expenses 8543521.30 5913317.34
Depreciation and amortization 556027643.30 410403475.53
Miscellaneous service charges 5974056.43 1189374.05
Traffic expenses 11461479.61 23356637.81
Travelling expenses 10780103.21 29427519.57
Entertainment expenses 1162489.46 1531047.02
Others 154580626.09 46212328.39
Total 1260364119.97 1048876421.66
43. Research and development expenses
Item Report period Same period of last year
Wages and benefits 701527180.22 810581975.90
Material fee 85090579.88 65395559.56
Subcontract fee 333086743.60 81396090.19
Travel research fee 17519367.04 31264931.10
Test fee 49958628.39 42934689.91
Depreciation and amortization 84795731.04 72497637.56
other fee 30977861.36 2453956.17
Total 1302956091.53 1106524840.39
44. Financial expenses
In RMB Yuan
Item Report period Same period of last year
Interest expense 28216059.24 13996367.31
Less: interest income 128484820.10 263722875.78
Exchange gain or loss -2640391.42 16320129.48
Others 6076443.13 7887536.68
Total -96832709.15 -225518842.31
45. Assets disposal income
In RMB Yuan
Item Report period Same period of last year
Included in 2018 non-recurring
gains and losses
Fixed assets disposal income 9392459.28 18771809.69 9392459.28
Total 9392459.28 18771809.69 9392459.28
46. Impairment loss on assets
In RMB Yuan
Item Report period Same period of last year
1. Bad debt loss - 2102999.91
2. Impairment provision of obsolete inventory 152676538.06 106838422.51
Total 152676538.06 108941422.42
47. Credit impairment loss (applicable from January 1 2019)
Item Report period Same period of last year
I. Notes receivable and bad debts of accounts receivable 7380783.24
2. Loss of bad debts of other receivables 2148950.42
Total 9529733.66
48. Changes in fair value gains and losses
Sources of income from changes in fair value Report period Same period of last year
Transactional financial assets 40337151.27
Total 40337151.27
49. Investment income
In RMB Yuan
Item Report period Same period of last year
Long-term equity investment income under equity
method
-108336709.94 1362011815.11
Total -108336709.94 1362011815.11
50. Other income
In RMB Yuan
Item Report period Same period of last year Explain
R&D special funds 476456238.65 526000000.00
Vehicle development project support - 331454741.70
Research and development grants for
power and intelligent technology
- 100000000.00
Deferred revenue amortization 110976095.19 78888221.15
Other government subsidies 33300740.27 79888256.47
Total 620733074.11 1116231219.32
51. Non-operating income
In RMB Yuan
Item Report period Same period of last year
Fines and others 18836680.44 29318896.76
Total 18836680.44 29318896.76
52. Non-operating expenses
In RMB Yuan
Item Report period Same period of last year
Donation 2300000.00 22300000.00
Vehicle reward 6029776.00 4080100.00
Fines and late fees 1065115.94 2968836.54
Others 3250175.26 22999826.39
Total 12645067.20 52348762.93
53. Income tax expenses
In RMB Yuan
Item Report period Same period of last year
Current income tax expense 31508825.01 43577796.68
Deferred income tax adjustment 85058871.07 -28289478.85
Total 116567696.08 15288317.83
54. Notes to cash flow statement
(1) The major cash received relating to other operating activities
In RMB Yuan
Item Amount
Interest income 119244542.40
Government grants related to operating activities 840966704.05
Others 2504538123.79
Total 3464749370.24
(2) The major cash paid relating to other operating activities
In RMB Yuan
Item Amount
Selling expenses 722315326.41
Administrative expenses 1086113871.84
Others 1486199833.16
Total 3294629031.41
(3) The major cash received relating to other investing activities
In RMB Yuan
Item Amount
Others 1478695.29
Total 1478695.29
(4) The major cash paid relating to other investing activities
In RMB Yuan
Item Amount
Others 315938190.60
Total 315938190.60
(5) The major cash received relating to other financing activities
In RMB Yuan
Item Amount
Redemption of the deposit for acceptance 37159887.74
Total 37159887.74
(6) The major cash paid relating to other financing activities
Item Amount
Payment of acceptance billsother 92446855.66
Others 125131.96
Total 92571987.62
55. Supplementary information of cash flow statement
(1) Supplementary information of cash flow statement
In RMB Yuan
Supplementary information Current Amount Prior-period Amount
1. Cash flow relating to operating activities calculated by
adjusting the net profit
Net profit -2244061428.35 1617481673.47
Add: credit impairment loss 9529733.66
Add: provision for assets impairment 152676538.06 108941422.42
Depreciation of fixed assets oil and gas assets productive
biological assets
1412926235.60 1045654724.17
Amortization of intangible assets 485234277.39 349623578.41
Amortization of long-term deferred expense 1190008.24 113355.78
Disposal loss/(income) on fixed assets intangible assets and
others long-term assets(with “-” for gains)
9392459.28 18771809.69
Loss of fair value change (revenue is marked with "-") -40337151.27 -
Financial expense(with “-” for gains) -96832709.15 -225518842.31
Investment loss(with “-” for gains) 108336709.94 -1362011815.11
Decrease in deferred tax assets(with “-” for gains) 91826434.28 -28289478.86
Decrease in inventory(with “-” for gains) -787955680.07 -60238054.79
Decrease in operating receivables(with “-” for gains) 3615249233.77 9804878336.43
Increase in operating payables(with “-” for gains) 1406660271.88 -6910067427.00
Others 96428697.69 42062477.85
Net cash flows from operating activities 4220263630.95 4401401760.15
2. Investment and financing activities involving no cash
incomings / outgoings
3. Movement of cash and cash equivalents
Ending balance of cash equivalents 10147607013.29 23767643401.89
Less: beginning balance of cash equivalents 9648153614.80 21451305090.53
Net increase in cash and cash equivalents 499453398.49 2316338311.36
(2) Cash and cash equivalents
In RMB Yuan
Item Ending balance Beginning balance
I. Cash
Including: Cash on hand 17875.99 14374.84
Bank deposits that can be readily used 10147589137.30 9648139239.96
II. Ending balance of cash and cash equivalents 10147607013.29 9648153614.80
VIII. The change of consolidation scope
1. Business combination not under the Same Control
□ Applicable √ Not Applicable
2. Combination under the same control
□ Applicable √ Not Applicable
3. Counter purchase
□ Applicable √ Not Applicable
4. Disposing subsidiary
Whether there is a single disposal of the subsidiary company investment that is the loss of control of the situation
□ Applicable √ Not Applicable
Whether there is a situation of the loss of control over the period of the investment and the loss of control of the subsidiary company
through multiple transactions
□ Applicable √ Not Applicable
5. Change of consolidation scope due to other reasons
(1) Newly established subsidiary companies during the reporting period
Name
Registered
Address
Type of
business
Registered Capital(Ten
Thousand Yuan)
Proportion of shares enjoyed
by the group
Chongqing Chehemei
Technology Co. Ltd.
Chongqing Sales 1000 100.00
(2) Subsidiary clearing during the reporting period
□ Applicable √ Not Applicable
Subsidiary clearing during the reporting period and related circumstances:
□ Applicable √ Not Applicable
IX. Stake in other entities
1. Rights in subsidaries
The subsidiaries of the Company are as follows：
Company name
Main
operating
Registered
place
Nature of
business
Registered
capital (ten
Total proportion
of shareholders
place thousand) (%)
Direct Indirect
I. The subsidiary formed by establishment or investment
Hebei Changan Automobile Co. Ltd. (Note
1)
Dingzhou Dingzhou Manufacturing 46469 94.22 -
Chongqing Changan International
Automobile Sales Co. Ltd.
Chongqing Chongqing Sales 1376 100.00 -
Chongqing Changan Vehicle Networking
Technology Co. Ltd.
Chongqing Chongqing Sales 8850 100.00 -
Chongqing Changan Special Automobile
Sales Co. Ltd (Note 2)
Chongqing Chongqing Sales 500 50.00 -
Chongqing Changan Automobile Supporting
Service Co. Ltd.
Chongqing Chongqing Sales 3000 99.00 1.00
Chongqing Changan New Energy
Automobile Co. Ltd.
Chongqing Chongqing R&D 2900 65.00 -
Chongqing Changan Europe Design
Academy Co. Ltd.
Turin Italy Turin Italy R&D EUR1738.36 100.00 -
Changan United Kingdom R&D Center Co.
Ltd.Nottingham
United
Kingdom
Nottingham
United
Kingdom
R&D GBP2482 100.00 -
Beijing Changan R&D Center Co. Ltd. Beijing Beijing R&D 100 100.00 -
Harbin Changan R&D Center Co. Ltd. Habin Habin R&D 100 100.00 -
Changan Japan Designing Center Co.Ltd.
Yokohama
Japan
Yokohama
Japan
R&D JPY2000 100.00 -
Changan United States R&D Center Co.
Ltd.Troy United
states
Troy United
states
R&D USD154 100.00 -
Changan Automobile Russia Co. Ltd.
Moscow
Russia
Moscow
Russia
Sales USD20 100.00 -
Changan Brazil Holdings Limited
St. Paul
Brazil
St. Paul
Brazil
Sales BRL100 100.00 -
Shenzhen Changan New Energy Automobile
Service Co. Ltd
Shenzhen Shenzhen Sales 5000 100.00 -
Hangzhou Changan Yixing Technology Co.Ltd.Hangzhou Hangzhou Lease 500 100.00 -
Hefei Changan Yixing Technology Co. Ltd. Hefei Hefei Lease 500 100.00 -
Nanjing Changan Connected Car Technology
Co. Ltd.
Nanjing Nanjing Lease 500 100.00 -
Beijing Changan Vehicle Networking
Technology Co. Ltd.
Beijing Beijing Lease 500 100.00 -
Haikou Changan Vehicle Networking
Technology Co. Ltd.Haikou Haikou Lease 500 100.00 -
Changan Vehicle Networking (Shanghai)
Technology Co. Ltd.Shanghai Shanghai Lease 500 100.00 -
Note 1: The Company owns 93.79% and 95.70% of voting shares of Nanjing Changan Automobile Co. Ltd. And Hebei Changan
Automobile Co. Ltd. respectively the difference between proportion of voting shares and proportion of shares held is due to the
voting right consigned from minority shareholders.Note 2: The remaining shareholders of Chongqing Changan Special Automobile Co. Ltd. made an agreement with the Company that
the remaining shareholders are to vote in accordance with the Company. The main financial and operating policies have been
controlled by the Company so it is included in the scope of consolidated financial statements.
As at June 30 2019 the Group has no subsidiaries with important minority interests.
2. Transctions result in change of holdingshare proportion but no effect in control of subsidiaries
□ Applicable √ Not applicable
3. Stakes in joint ventures and associates
Tianjin Changan Vehicle Networking
Technology Co. Ltd.Tianjin Tianjin Lease 500 100.00 -
Xiamen Changan New Energy Automobile
Sales & Service Co. Ltd.Xiamen Xiamen Sales 200 100.00 -
Guangzhou Changan New Energy
Automobile Sales & Service Co. Ltd.
Guangzhou Guangzhou Sales 400 100.00 -
Fuzhou Fuqing Changan New Energy
Automobile Sales & Service Co. Ltd.
Fuzhou Fuzhou Sales 200 100.00 -
Chongqing Chehemei Technology Co. Ltd. Chongqing Chongqing Sales 1000 100.00
Chongqing Changan New Energy
Automobile Technology Co. Ltd.
Chongqing Chongqing R&D 9900 100.00 -
II. The subsidiary formed by business combination not under common control
Nanjing Changan Automobile Co.Ltd.(Note1)
Nanjing Nanjing Manufacturing 60181 84.73 -
Chongqing Changan Suzuki Automobile Co.
Ltd.Zhenjiang Demao Hairun Equity
Investment Fund Partnership (Limited
Partnership)
Chongqing Chongqing Manufacturing 133764 100.00
Zhenjiang Demao Hairun Equity Investment
Fund Partnership (Limited Partnership)
Zhenjiang Zhenjiang
Financial
industry
150001 100.00
III. The subsidiary formed by business combination under common control
Hebei Baoding Changan Bus Co. Ltd. Dingzhou Dingzhou Manufacturing 3000 100.00 -
Hefei Changan Automobile Co.Ltd. Hefei Hefei Manufacturing 77500 100.00 -
Company name
Main
operating
place
Registered
place
Nature of business
Registered
capital (ten
thousand)
Total proportion of
shareholders (%)
Accounting
treatment
Direct Inderect
I. Joint ventures
Jiangling Holding Co. Ltd. Nanjing Nanjing
Manufacture and sale
ofautomobiles and
components
100000 50.00 - Equity
Changan Ford Automobile
Co. Ltd.
Chongqing Chongqing
Manufacture and sale
ofautomobiles and
components
USD24100 50.00 - Equity
Changan Mazda Automobile
Co. Ltd.
Nanjing Nanjing
Manufacture and sale
ofautomobiles and
components
USD11097 50.00 - Equity
Changan Mazda Engine Co.
Ltd. (Note 1)
Nanjing Nanjing
Manufacture and sale
ofautomobiles and
components
USD20996 50.00 - Equity
Changan PSA Automobiles
Co. Ltd.
Shenzhen Shenzhen
Manufacture and sale
ofautomobiles and
components
400000 50.00 - Equity
Changan Weilai New Energy
Automobile Technology Co.
Ltd.Nanjing Nanjing
Manufacture and sale
ofautomobiles and
components
9800 50.00 - Equity
II. Associates
Chongqing Changan Kuayue
Automobile Co. Ltd.
Chongqing Chongqing
Develop product and
sale of automobile and
components; import
and export goods.
6533 34.30 - Equity
Chongqing Changan Kuayue
Automobile Sales Co. Ltd.
Chongqing Chongqing
Sale of Changan
Kuayue’ s automobile
and agricultural cars
and components.Technical advisory
services for automobile
300 34.30 - Equity
Beijing Fang’an Taxi Co. Ltd. Beijing Beijing
For the car loan
business
2897.96 20.70 - Equity
Chongqing Auto Finance Co.
ltd.
Chongqing Chongqing
Provide car loan;
provide vehicle loans
and operating
equipment loans to car
dealers including the
construction loans of
exhibition hallspare
parts loans and
maintenance equipment
loans etc.
476843.1 28.66 - Equity
Hainan Anxinxing Information
Technology Co. Ltd.
Chengmai
County
Chengmai
County
Software and hardware
technology
development technical
3000 30.00 - Equity
X. Risks associated with financial instruments
1. Classification of financial instruments
As at balance sheet day the book values of financial instruments are as follows:
Financial assets
In RMB Yuan
2019.6.30
Financial Assets Measured at
Fair Value and Their Changes
Included in Current Profits and
Losses
Measured at amortized cost
Measured at fair value and
its changes are included in
other comprehensive income
Cash 10535284892.55
Transactional financial assets 1570658462.58
consulting auto parts
sales
Nanjing Chelai Travel
Technology Co. Ltd.Nanjing Nanjing
Car sales leasing
software technology
development technical
services
10000 10.00 - Equity
Hunan Guoxin Semiconductor
Technology Co. Ltd.Zhuzhou Zhuzhou
Technology
development
consulting technical
services technology
transfer in the field of
power semiconductors
50000 25.00 - Equity
Beijing Wutong Chelian
Technology Co. Ltd.
Beijing Beijing
Technology
development technical
consulting technical
services technology
transfer
20000 - - Equity
Anhe (Chongqing) Equity
Investment Fund Management
Co. Ltd.
Chongqing Chongqing
Equity investment
management
1000 - - Equity
Hangzhou Chelizi Intelligent
Technology Co. Ltd.Hangzhou Hangzhou Car travel service 630 - - Equity
Nanjing Leading Equity
Investment Partnership
Nanjing Nanjing
Equity investment
venture capital
investment
976000 15.00 - Equity
Nanjing Leading Equity
Investment Management Co.Ltd.Nanjing Nanjing
Equity investment
management
1000 16.39 - Equity
Notes receivable 15646668140.73
Accounts receivable 2011970761.86
Other receivables 3508904992.23
Investment in other equity
instruments
504572800.00
Total 1570658462.58 31702828787.37 504572800.00
In RMB Yuan
2018 Loans and accounts receivable Available-for-sale financial assets
Cash 9980544526.14 -
Notes receivable 20561625805.24 -
Accounts receivable 1409419600.50
Other receivables 3250452923.70 -
Available-for-sale financial assets - 1957873311.31
Total 35202042855.58 1957873311.31
Financial liabilities
In RMB Yuan
2019.6.30 2018.12.31
Short-term loans 210000000.00 190000000.00
Notes payable 13769475508.94 14807862262.39
Accounts payable 14276660036.85 13916201276.95
Other payables 5165398262.95 3079749015.81
Long-term loan 305774538.84 303590824.69
Total 33727308347.58 32297403379.84
2. Transfer of financial assets
The transferred financial assets that entirely derecognized but continuing involved
As at 30 June 2019 the Group has endorsed bank acceptance bill with a carrying amount of RMB 2195073464.21 to suppliers to
settle the accounts payable. The maturities of the notes are between 1 to 6 months. According to the relevant provisions of the "law of
negotiable instruments" if the banks refuse the payment the holder has the right of recourse to the Group (the "continuing
involvement"). The Group holds the view that almost all the risks and rewards concerned have been transferred; therefore the book
value of the accounts payable should be derecognized. The maximum loss and the undiscounted cash flow of the continuing
involvement and repurchase is equal to its book value the Group regards the fair value of the continuing involvement is not
significant.
As of June 30 2019 the Group operated a number of discount businesses with banks in China. The Group considers that the notes
receivable with book value of RMB 1797476050.00 have transferred most of the risks and rewards related to the notes receivable at
the time of discount thus meeting the conditions for termination of recognition of financial assets. On the discount day the relevant
receivables shall be terminated in full accordance with the book value. These terminated recognized receivables continue to be
exposed to the greatest risk and have the same discounted cash flow as the book value of the receivables when they are repurchased.If the acceptor refuses to pay the bill when it matures it has the right to recourse to the group ("continue to involve"). In the view of
the Group the continued involvement in fair value is not significant.In the first half of 2019 the Group did not recognize gains or losses on its transfer date. The Group shall continue to be involved in
the proceeds or expenses of the year in which the recognition of financial assets has been terminated and the cumulative recognition
thereof. Endorsements occur roughly and evenly during the year.
3. Risks of financial instruments
The Group’s principal financial instruments except for derivatives include bank loans bonds payable cash etc. The main purpose
of these financial instruments is to raise finance for the Group’s operations. The Group has various other financial assets and
liabilities such as accounts receivable and accounts payable which arise directly from its operations.The main risks arising from the Group’s financial instruments are credit risk liquidity risk and market risk. The Group’s risk
management policies are summarized below:
Credit risk
The Group trades only with recognized creditworthy third parties. It is the Group’s policy that all customers who wish to trade on
credit terms are subject to credit verification procedures. In addition receivable balances are monitored on an ongoing basis with the
result that the Group’s exposure to bad debts is not significant. For transactions that do not occur in the country of the relevant
operating unit the Group does not offer credit terms without the approval of the special department of credit control.With respect to credit risk arising from the other financial assets of the Group which comprise cash and cash equivalents
available-for-sale financial assets other receivables dividend receivables and certain derivatives financial instruments the Group’s
exposure to credit risk arising from default of the counterparty with a maximum exposure equal to the carrying amount of these
instruments listed as book value of financial assets in consolidated financial statements. In 2018 there was no credit risk arising
from financial guarantee.
No gage is required since the Group trades only with recognized creditworthy third parties. Credit risks are managed by clients and
industries collectively. As at 31 December 2018 among the Group’s collections with specific credit risk 48.73% of accounts
receivables of the Group are due from top five clients. The Group does not hold any gage from or enhance credit limit to these
clients.
2019
Credit Risk Increasing the Judgment Criteria Significantly
The Group assesses whether the credit risk of the relevant financial instruments has increased significantly since the initial
confirmation on each balance sheet day. In determining whether credit risk has increased significantly since the initial confirmation
the Group considers that reasonable and valid information including qualitative and quantitative analysis based on the Group's
historical data external credit risk rating and forward-looking information can be obtained without unnecessary additional costs or
efforts. Based on a single financial instrument or a portfolio of financial instruments with similar credit risk characteristics the Group
compares the risk of default of financial instruments on the balance sheet date with the risk of default on the initial confirmation date
to determine the change of default risk of financial instruments during the expected lifetime.When triggering one or more of the following quantitative and qualitative criteria the Group believes that the credit risk of financial
instruments has increased significantly:
Quantitative criteria are that the probability of default of the remaining duration of the reporting day rises by more than a certain
percentage compared with the initial confirmation
Qualitative criteria include major adverse changes in the debtor's business or financial situation early warning customer lists etc.The upper limit indicator is that the debtor's contract payments (including principal and interest) are overdue for more than [30] days.Other financial assets of the Group include monetary funds sellable financial assets other receivables etc. The credit risk of these
financial assets originates from the default of the counterparty and the maximum risk exposure equals the book value of these
instruments. The Group faces no credit risk in this year due to the provision of financial guarantees.
Definition of assets with impaired credit
In order to determine whether credit impairment occurs the defining criteria adopted by the Group are consistent with the internal
objectives of credit risk management for relevant financial instruments taking into account quantitative and qualitative indicators.When assessing whether the debtor has suffered credit impairment the Group mainly considers the following factors:
Major financial difficulties occur to the issuer or debtor;
The debtor breaches the contract such as defaulting of the interest or overdue principal etc.The creditor gives the debtor concessions in no other case for economic or contractual considerations related to the debtor's financial
difficulties;
The debtor is likely to go bankrupt or undergo other financial restructuring;
The financial difficulties of the issuer or debtor lead to the disappearance of the active market of the financial assets;
Purchase or derivation of a financial asset at a substantial discount reflects the credit losses.
Credit impairment of financial assets may be caused by the interaction of multiple events not necessarily by separate identifiable
events.Parameters for Measuring Expected Credit Loss
Depending on whether credit risk has increased significantly and whether credit impairment has occurred the Group measures
impairment provision for different assets by anticipated credit losses for 12 months or the whole life period respectively. The key
parameters of anticipated credit loss measurement include default probability default loss rate and default risk exposure. Considering
the quantitative analysis and forward-looking information of historical statistics (such as counterparty ratings guarantees and
collateral types repayment methods etc.) the Group establishes a default probability default loss rate and default risk exposure
model.The relevant definitions are as follows:
The probability of default refers to the possibility that the debtor will not be able to fulfil its obligation to pay in the next 12 months
or throughout the remaining period. The default probability of the group is adjusted based on the results of XX model and
forward-looking information is added to reflect the default probability of the debtor under the current macroeconomic environment.The default loss rate refers to the group's expectation of the extent of loss from exposure to default risk. According to the type of
counterparty the way and priority of recourse and the different collateral the loss rate of breach of contract is also different. The
default loss rate is the percentage of risk exposure loss at the time of default which is calculated on the basis of the next 12 months
or the whole duration.The default risk exposure is the amount that the group should be repaid in the event of default in the next 12 months or throughout
the remaining period.Prospective information
The assessment of significant increase in credit risk and the calculation of anticipated credit losses involve forward-looking
information. Through historical data analysis the Group identifies key economic indicators affecting credit risk and expected credit
loss of various business types.The impact of these economic indicators on default probability and default loss rate varies with different business types. In this
process the Group applies expert judgment to forecast these economic indicators annually based on the results of expert judgment
and determines the impact of these economic indicators on default probability and default loss rate through [regression analysis].Liquidity risk
The Group adopts cycle liquidity planning instrument to manage capital shortage risks. The instrument takes into consideration the
maturity date of financial instruments plus estimated cash flow from the Group’s operations.The Group’s objective is to maintain a balance between continuity of funding and flexibility and sufficient cash to support operating
capital through financing functions by the use of bank loans debentures etc.Market risk
Interest rate risk
The Group’s revenue and operating cash flows are seldomly influenced by the interest fluctuation. As at 30 June 2019 the Group’s
loans are bearing fixed interest rate and the Group is not hedging the risk currently.
Foreign currency risk
The Group’s exposures to fluctuation in foreign currency exchange rate mainly arise from operating activities where transactions are
settled in currencies other than the units' functional currency and net investment to offshore subsidiary.
In 30 June 2019 the Group only has limited transactional currency exposures of its total revenue that is valued in currencies other
than the units' functional currency. Since most of the Group’s businesses are operated in China mainland the estimated influence of
fluctuation of foreign currency is insignificant; therefore the Group hasn’t carried out large amount of hedging to reduce the risk.
Equity instruments investment price risk
The Group is exposed to equity price risk arising from individual equity investments classified as transactional financial investments
(Note VII 2) as at 30 June 2019. The Group’s listed investments are listed on the Shanghai and Shenzhen stock exchanges and valued
at quoted market prices at the end of the reporting period. The following table demonstrates the sensitivity to every 5% change (based
on the carrying amount as at the end of reporting period) in the Group’s net profit and fair value of the equity investments with all
other variables held constant based on their carrying amounts at the end of the reporting period.
Carrying amount of equity
investments
Change in fair value Increase/(decrease) in equity
2019.6.30
Shanghai- Transactional
financial assets
175370000.00 5% 7453225.00
Shanghai- Transactional
financial assets
175370000.00 -5% -7453225.00
Shenzhen-Transactional
financial assets
1395288462.58 5% 59299759.66
Shenzhen-Transactional
financial assets
1395288462.58 -5% -59299759.66
2018.12.31
Shanghai- Available for sale 123540000.00 5% 5250450.00
Shanghai- Available for sale 123540000.00 -5% -5250450.00
Shenzhen- Available for sale 1406781311.31 5% 59788205.73
Shenzhen- Available for sale 1406781311.31 -5% -59788205.73
4. Capital management
The main goal of the Group’s capital management is to ensure that the ability of continuous operation and maintain a healthy capital
ratios in order to support business development and to maximize shareholder value.The Group manages the capital structure and adjusts it with the change of economy trend and the risk feature of the assets. To
maintain or adjust the capital structure the Group can rectify dividend distribution return capital to shareholders or issue new shares.The Group is not subject to external mandatory capital requirements constraints. The goal principle and procedure of capital
management stay the same in 2018 and 30 June 2019.The Group’s leverage ratio on the balance sheet date is as follows:
30 June 2019 31 December 2018
Leverage ratio 52.64% 50.63%
XI. Disclosure of fair value
1. Assets and liabilities measured at fair value
June 30 2019
In RMB Yuan
Input measured at fair value
Quoted price in
active market
(The first level)
Important and
observable input
(The second level)
Important but
unobservable input
(The third level)
Total
Trading financial assets -
equity instrument
investment
175370000.00 1395288462.58 1570658462.58
Other equity instruments 504572800.00 504572800.00
December 31 2018
In RMB Yuan
Input measured at fair value
Quoted price in
active market
(The first level)
Important and observable
input
(The second level)
Important but
unobservable input
(The third level)
Total
Available-for-sale
financial assets- equtiy
instruments
123540000.00 1406781311.31 1530321311.31
2. Fair value valuation
Fair value of financial instruments
The management has assessed the monetary funds notes receivable and accounts receivable other receivables short-term loans
other payables bills payable and accounts payable. The fair value is equal to the book value because the remaining period is not long.The fair value of financial assets and financial liabilities is determined by the amount of voluntarily exchange of assets or debt
settlement between the parties to the transaction in a fair transaction rather than the amount of money that is forced to sell or
liquidate.Long-term borrowings and long-term borrowings due within one year are determined using the discounted future cash flow method
to determine the fair value using the market yields of other financial instruments with similar contractual terms credit risk and
remaining maturity as the discount rate. On December 31 2018 the risk assessment of long-term borrowings and long-term
borrowings due within one year was not significant.The equity instruments listed by the Company include unrestricted ordinary shares and restricted shares. The unrestricted ordinary
shares investment determines the fair value by market quotation and the restricted stock investment uses the discounted valuation
model to estimate the fair value. We believe that the fair value and its changes estimated by valuation techniques are reasonable and
are also the most appropriate value on the balance sheet date.XII. Rela XII. Related parties and related party transactions
1. Parent company of the Company
Parent
company
Related
parties’
relationship
Company
type
Place of
registration
Legal
representative
Nature of
the business
Registered
capital
Proportion
of shares in
the
Company
(%)
Proportion
of voting
rights in the
company
(%)
Final
controlling
party
Organization
Code
China
Changan
Automobile
Group
Co Ltd.
controlling
shareholder
Liability
limited
Beijing Liu Weidong
Manufacture
and sale of
automobiles
engine and
components
45823737
00
22.53% 22.53%
China South
Industries
Group
corporation
9111000-0710
Main business and products: design development manufacturing and marketing of automobiles motorcycles automobile
motorcycle engines automobile motorcycle parts and components; Sales of optical products electronic and optoelectronic
productsnight vision equipments information and communications equipment; technology development technology transfer
technical consulting technical training technical services related to the above mentioned business; Import and export business; Asset
acquisitions recapitalization.
125
2. Subsidiaries
See subsidiaries in IX. Stake in other entities.
3. Other related parties
Other related parties Relationship
Changan Ford Automobile Co.Ltd. Joint venture
Changan Ford Automobile Co. Ltd. - Harbin branch Joint venture
Changan Ford Automobile Co. Ltd. - Hangzhou branch Joint venture
Changan Mazda Automobile Co.Ltd. Joint venture
Changan Mazda Engine Co. Ltd. Joint venture
Jiangling Holding Co. Ltd. Joint venture
Jiangling Holding Landwind Plant Joint venture
Changan PSA Automobiles Co. Ltd. Joint venture
Changan Weilai New Energy Automobile Technology Co. Ltd. Joint venture
Changan Automobile Finance Co. Ltd. Associated enterprise
Hainan Anxinxing Information Technology Co. Ltd. Associated enterprise
Nanjing Chelai Travel Technology Co. Ltd. Associated enterprise
Chongqing Changan Kuayue Automobile Co. Ltd. Associated enterprise
Hangzhou Chelizi Intelligent Technology Co. Ltd. Associated enterprise
Beijing Fangan Xinyue Taxi Co. Ltd. Associated enterprise
Hunan Guoxin Semiconductor Technology Co. Ltd. Associated enterprise
Chongqing Changan Kuayue Automobile Marketing Co. Ltd. Associated enterprise
Chongqing Changan Industrial (Group) Co. Ltd. Subordinate company of South Industries
Chongqing Changan Real Estate Development Co. Ltd. Subordinate company of Changan Industries
Chongqing Changan Construction Engineering Co. Ltd. Subordinate company of Changan Industries
Sichuan Hongguang Machinery and Electrics Co. Ltd. Subordinate company of Changan Industries
Chongqing Changan Property Management Co. Ltd. Subordinate company of Changan Industries
China Changan Automobile Co. Ltd. Parent company
China Changan Automobile Co. Ltd. – Chongqing Qingshan Transmission Branch Branch of China Changan
Sichuan Jianan Industrial Co. Ltd. Subordinate company of China Changan
Sichuan Jian'an Industrial Co. Ltd. - Chengdu Jianan Axle Branch Subordinate company of China Changan
South Air International Co.Ltd. Subordinate company of China Changan
Sichuan Ningjiang Shanchuan Machinery Co Ltd. Subordinate company of China Changan
Sichuan Ningjiang Shanchuan Machinery Co Ltd. - Longchang Shock Absorber Branch Subordinate company of China Changan
Other related parties Relationship
Chengdu Huachuan Electric Equipment Co. Ltd. Subordinate company of China Changan
Chongqing Automobile Air-Conditioning Co. Ltd. Subordinate company of China Changan
Csgc Trw Chassis Systems Co.Ltd. Subordinate company of China Changan
Chongqing Changan Min Sheng Logistics Co. Ltd. Subordinate company of China Changan
Chongqing Changan Min Sheng Logistics Co. Ltd. - Yubei branch Subordinate company of China Changan
Chongqing Wanyou Auto Sales and Service Co. Ltd. Subordinate company of China Changan
Chongqing Wanyou Longrui Auto Sales and Service Co. Ltd. Subordinate company of China Changan
Chongqing Wanyou Longxing Auto Sales and Service Co. Ltd. Subordinate company of China Changan
Guangxi Wanyou Auto Sales and Service Co. Ltd. Subordinate company of China Changan
Nanning Wanyou Auto Sales and Service Co. Ltd. Subordinate company of China Changan
Chengdu Wanyou Xiangyu Auto Sales and Service Co. Ltd. Subordinate company of China Changan
Chengdu Wanyou Trading Co. Ltd. Subordinate company of China Changan
Hafei Motor Co. Ltd. Subordinate company of China Changan
Chongqing Anfu Automobile Marketing Co. Ltd. Subordinate company of China Changan
China Changan Automobile Group Tianjin Sales Co. Ltd. Subordinate company of China Changan
Chengdu Ningjiang Zhaohe Automobile Components Co. Ltd. Subordinate company of China Changan
Harbin Dongan Auto Engine Co. Ltd. Subordinate company of China Changan
Harbin Dongan Automotive Engine Manufacturing Co. Ltd. Subordinate company of China Changan
United Prosperity Investment Co. Ltd (Hongkong) Subordinate company of China Changan
United Prosperity Investment Co. Ltd (Shenzhen) Subordinate company of China Changan
Wanyou Automobile Investment Co. Ltd. Subordinate company of China Changan
Chengdu Wanyou Auto Trade Service Co. Ltd. Subordinate company of China Changan
Chongqing Wanyou Economic Development Co. Ltd. Subordinate company of China Changan
Chongqing Wanyou Economic Development Co. Ltd. – Changshou Branch Subordinate company of China Changan
Chongqing Wanyou Economic Development Co. Ltd. – Fengdu Branch Subordinate company of China Changan
Chongqing Wanyou Economic Development Co. Ltd. – JIangjin Branch Subordinate company of China Changan
Chongqing Wanyou Economic Development Co. Ltd. – Qianjiang Branch Subordinate company of China Changan
Chongqing Wanyou Economic Development Co. Ltd. – Dazu Branch Subordinate company of China Changan
Chongqing Wanyou Economic Development Co. Ltd. – Hechuan Branch Subordinate company of China Changan
Chongqing Wanyou Economic Development Co. Ltd. – Nanping Branch Subordinate company of China Changan
Chongqing Wanyou Economic Development Co. Ltd. – Yongchuan Branch Subordinate company of China Changan
Chongqing Wanyou Economic Development Co. Ltd. – Jiangnan Branch Subordinate company of China Changan
Chongqing Wanyou Zunda Automobile Sales & Service Co. Ltd. Subordinate company of China Changan
Other related parties Relationship
Chongqing Wanyou Zunda Automobile Sales & Service Co. Ltd. – Guangxi Branch Subordinate company of China Changan
Chongqing Wanyou Zunda Automobile Sales & Service Co. Ltd. – Guizhou Branch Subordinate company of China Changan
Chongqing Wanyou Zunda Automobile Sales & Service Co. Ltd. – Parts Branch Subordinate company of China Changan
Chongqing Wanyou Zunda Automobile Sales & Service Co. Ltd. – Sichuan Branch Subordinate company of China Changan
Chongqing Wanyou Zunda Automobile Sales & Service Co. Ltd. –Yunnan Branch Subordinate company of China Changan
Yunnan Wanyou Automobile Sales & Service Co. Ltd. Subordinate company of China Changan
Guizhou Wanyou Automobile Sales & Service Co. Ltd. Subordinate company of China Changan
Yunnan Xiangyu Automobile Sales & Service Co. Ltd. Subordinate company of China Changan
Chongqing Fuji Supply Chain Management Co. Ltd. Subordinate company of China Changan
Panzhihua Wanyou Automobile Sales & Service Co. Ltd. Subordinate company of China Changan
Ya'an Wanyou Automobile Sales & Service Co. Ltd. Subordinate company of China Changan
Chongqing Wanyou Ducheng Automobile Sales & Service Co. Ltd. Subordinate company of China Changan
Chongqing Wanyou Ducheng Automobile Sales & Service Co. Ltd. –Zhongxian Branch Subordinate company of China Changan
Chongqing Wanyou Xingjian Automobile Sales & Service Co. Ltd. Subordinate company of China Changan
Luzhou Wanyou Automobile Service Co. Ltd. Subordinate company of China Changan
Luzhou Wanyou Automobile Service Co. Ltd. – Naxi Branch Subordinate company of China Changan
Southern Faurecia Auto Parts Co. Ltd. Subordinate company of China Changan
Chengdu Wanyou Automobile Sales & Service Co. Ltd. Subordinate company of China Changan
Bazhong Wanyou Automobile Sales & Service Co. Ltd. Subordinate company of China Changan
Liangshan Wanyou Automobile Sales & Service Co. Ltd. Subordinate company of China Changan
Kunming Wanning Automobile Sales & Service Co. Ltd. Subordinate company of China Changan
Harbin Botong Auto Parts Manufacturing Co. Ltd. Subordinate company of China Changan
Chongqing Qingshan Transmission Sales Co. Ltd. Subordinate company of South Group
Hubei Xiaogan Huazhong Automobile Light Co. Ltd. Subordinate company of South Group
Chongqing Changrong Machinery Co. Ltd. Subordinate company of South Group
Chengdu Lingchuan Special Industry Co. Ltd. Subordinate company of South Group
Chengdu Lingchuan Vehicle Oil Tank Co. Ltd. Subordinate company of South Group
Chongqing Changfeng Jiquan Machinery Co. Ltd. Subordinate company of South Group
Yunnan Xiyi Industries Co. Ltd. Subordinate company of South Group
Chongqing Shangfang Automobile Fittings Co. Ltd. Subordinate company of South Group
Chongqing Dajiang Xinda Vehicles Shares Co. Ltd. Subordinate company of South Group
Chongqing Dajiang Yuqiang Plastic Co. Ltd. Subordinate company of South Group
Chongqing Jianshe Automobile Air-conditioner Co. Ltd. Subordinate company of South Group
Other related parties Relationship
China South Industries Group Finance Co. Ltd. Subordinate company of South Group
Southwest Ordnance Industry Corporation Subordinate company of South Group
Chengdu Wanyou Filter Co. Ltd. Subordinate company of South Group
Chongqing Yihong Engineering Plastic Products Co. Ltd. Subordinate company of South Group
Beijing Beiji Mechanical and Electrical Industry Co. Ltd. Subordinate company of South Group
Chengdu Jialing Huaxi Optical & Precision Machinery Co. Ltd. Subordinate company of South Group
Chongqing Nexteer steering system co. Ltd Subordinate company of South Group
Chongqing Dajiang Jiexing Forging Co. Ltd. Subordinate company of South Group
Chongqing Jialing Yimin Special Equipment Co. Ltd. Subordinate company of South Group
Chengdu Guangming Tianzhong Environmental Protection Technology Co. Ltd. Subordinate company of South Group
Chongqing Xiyi Automobile Connecting Rod Co. Ltd. Subordinate company of South Group
Chongqing Dajiang Guoli Precision Machinery Manufacturing Co. Ltd. Subordinate company of South Group
4. Related-party transaction
(1) Goods purchased and services received
In RMB Yuan
Related parties
Nature of the
transaction
Current amount
Approved
transaction amount
Whether
it exceeds
the
transactio
n amount
Prior-period
amount
Changan Ford Automobile Co.Ltd.
Purchase of
spare parts
840032.40 1413003.88 No 196358.68
Changan Ford Automobile Co.Ltd. -
Harbin branch
Purchase of
spare parts
450451.43 7674650.72 No 50332437.64
Jiangling Holding Co. Ltd.Purchase of
spare parts
- 1650000.00 No 211813380.00
Changan PSA Automobiles Co. Ltd.
Purchase of
spare parts、
Accept service
42367096.09 246803700.00 No -
Chongqing Changan Kuayue Automobile
Co. Ltd.
Purchase of
spare parts
- - No 2185200.00
Hangzhou Chelizi Intelligent Technology
Co. Ltd.
Purchase of
spare parts
3150482.79 - Yes -
Chongqing Changan Industrial (Group)
Co. Ltd.
Accept service 348568.01 13678470.17 No 35491790.41
Related parties
Nature of the
transaction
Current amount
Approved
transaction amount
Whether
it exceeds
the
transactio
n amount
Prior-period
amount
Chongqing Changan Construction
Engineering Co. Ltd.
Accept service 7313785.24 235830010.02 No 767688.60
Sichuan Hongguang Machinery and
Electrics Co. Ltd.
Purchase of
spare parts
3339067.87 10045813.15 No 5247314.70
Chongqing Changan Property
Management Co. Ltd.
Accept service 1812064.04 6855450.00 No 1880756.31
China Changan Automobile Co. Ltd. –
Chongqing Qingshan Transmission
Branch
Purchase of
spare parts
455343757.53 1682734997.69 No 790009094.86
Sichuan Jianan Industrial Co. Ltd.Purchase of
spare parts
353770028.01 755184952.97 No 396002416.92
Sichuan Jian'an Industrial Co. Ltd. -
Chengdu Jianan Axle Branch
Purchase of
spare parts
- - No -20068.28
South Air International Co.Ltd.Purchase of
spare parts
153661141.06 625914322.13 No 278286144.78
Sichuan Ningjiang Shanchuan Machinery
Co Ltd.
Purchase of
spare parts
34121749.07 168945306.07 No 68700314.53
Sichuan Ningjiang Shanchuan Machinery
Co Ltd. - Longchang Shock Absorber
Branch
Purchase of
spare parts
16894846.23 6807066.25 No 14571788.09
Chengdu Huachuan Electric Equipment
Co. Ltd.
Purchase of
spare parts
130426180.96 315692574.27 No 147010890.28
Chongqing Automobile Air-Conditioning
Co. Ltd.
Purchase of
spare parts
- - No -
Csgc Trw Chassis Systems Co.Ltd.
Purchase of
spare parts
202875095.90 759647453.82 No 302296647.64
Chongqing Changan Min Sheng Logistics
Co. Ltd.
Purchase of
spare parts、
Accept service
827152859.32 2731929163.09 No 669938773.76
Guangxi Wanyou Auto Sales and Service
Co. Ltd.
Accept service 63818.11 - No -
Nanning Wanyou Auto Sales and Service
Co. Ltd.
Accept service 70493.10 - No -
Chengdu Wanyou Xiangyu Auto Sales
and Service Co. Ltd.
Accept service 248627.10 - No -
Chengdu Wanyou Trading Co. Ltd. Accept service 18514.24 - No -
Related parties
Nature of the
transaction
Current amount
Approved
transaction amount
Whether
it exceeds
the
transactio
n amount
Prior-period
amount
China Changan Automobile Group
Tianjin Sales Co. Ltd.
Accept service 25144.55 - No -
Chengdu Ningjiang Zhaohe Automobile
Components Co. Ltd.
Purchase of
spare parts
47772865.85 49128786.79 No 11369508.22
Harbin Dongan Auto Engine Co. Ltd.Purchase of
spare parts
420102474.82 830544500.95 No 407727748.76
Harbin Dongan Automotive Engine
Manufacturing Co. Ltd.Purchase of
spare parts
353143739.85 448373823.07 No 232165111.94
Chengdu Wanyou Auto Trade Service
Co. Ltd.
Accept service 464001.50 - No -
Chongqing Wanyou Economic
Development Co. Ltd.
Purchase of
spare parts、
Accept service
134932176.36 434639017.58 No 191811118.53
Yunnan Wanyou Automobile Sales &
Service Co. Ltd.
Accept service 1084974.53 - No -
Guizhou Wanyou Automobile Sales &
Service Co. Ltd.
Accept service 986717.54 - No -
Yunnan Xiangyu Automobile Sales &
Service Co. Ltd.
Accept service 124427.22 - No -
Panzhihua Wanyou Automobile Sales &
Service Co. Ltd.
Accept service 13092.15 - No -
Ya'an Wanyou Automobile Sales &
Service Co. Ltd.
Accept service 128960.48 - No -
Chongqing Wanyou Ducheng
Automobile Sales & Service Co. Ltd.
Accept service 327791.37 - No -
Chongqing Wanyou Xingjian Automobile
Sales & Service Co. Ltd.
Accept service 257093.48 - No -
Luzhou Wanyou Automobile Service Co.Ltd.
Accept service 20198.04 - No -
Southern Faurecia Auto Parts Co. Ltd.Purchase of
spare parts
114560039.57 501336000.00 No -
Bazhong Wanyou Automobile Sales &
Service Co. Ltd.
Accept service 14698.71 - No -
Liangshan Wanyou Automobile Sales &
Service Co. Ltd.
Accept service 40679.82 - No -
Chongqing Qingshan Transmission Sales
Co. Ltd.
Purchase of
spare parts
3559602.32 6189337.21 No 3372342.00
Related parties
Nature of the
transaction
Current amount
Approved
transaction amount
Whether
it exceeds
the
transactio
n amount
Prior-period
amount
Hubei Xiaogan Huazhong Automobile
Light Co. Ltd.Purchase of
spare parts
46683372.83 76474295.70 No 41165671.16
Chongqing Changrong Machinery Co.
Ltd.Purchase of
spare parts
6433171.02 17359212.30 No 12476284.96
Chengdu Lingchuan Special Industry Co.
Ltd.Purchase of
spare parts
9930016.99 17737916.16 No 16648659.65
Chengdu Lingchuan Vehicle Oil Tank
Co. Ltd.
Purchase of
spare parts
18186753.45 75940339.34 No 36629643.10
Chongqing Changfeng Jiquan Machinery
Co. Ltd.
Purchase of
spare parts
10396114.98 29026088.70 No 11501147.75
Yunnan Xiyi Industries Co. Ltd.Purchase of
spare parts
30665985.08 105955263.92 No 50426409.01
Chongqing Shangfang Automobile
Fittings Co. Ltd.
Purchase of
spare parts
15447216.43 49476726.42 No 25730159.90
Chongqing Dajiang Xinda Vehicles
Shares Co. Ltd.Purchase of
spare parts
7009231.20 160146161.27 No 81105898.94
Chongqing Dajiang Yuqiang Plastic Co.
Ltd.Purchase of
spare parts
70660688.47 298706005.96 No 161444150.25
Chongqing Jianshe Automobile
Air-conditioner Co. Ltd.
Purchase of
spare parts
45884509.86 110624360.16 No 44409783.45
Chongqing Dajiang Xinda Vehicles
Shares Co. Ltd.Purchase of
spare parts
56809638.72 156971238.84 No 93328718.59
Chongqing Yihong Engineering Plastic
Products Co. Ltd.Purchase of
spare parts
3943111.25 23641386.70 No 14426634.47
Beijing Beiji Mechanical and Electrical
Industry Co. Ltd.Purchase of
spare parts
21611.25 1163002.81 No 41364.74
Chengdu Jialing Huaxi Optical &
Precision Machinery Co. Ltd.Purchase of
spare parts
6120347.20 18699132.68 No 7735029.09
Chongqing Nexteer steering system co.
Ltd
Purchase of
spare parts
319878978.48 663918298.44 No 307967283.63
Chongqing Dajiang Jiexing Forging Co.
Ltd.Purchase of
spare parts
1178761.66 3243514.03 No 778239.55
Chengdu Guangming Tianzhong
Environmental Protection Technology
Purchase of
spare parts
-1885.21 - No -1771.14
Related parties
Nature of the
transaction
Current amount
Approved
transaction amount
Whether
it exceeds
the
transactio
n amount
Prior-period
amount
Co. Ltd.
Chongqing Xiyi Automobile Connecting
Rod Co. Ltd.Purchase of
spare parts
-5769.12 - No -4295.93
Chongqing Dajiang Guoli Precision
Machinery Manufacturing Co. Ltd.Purchase of
spare parts
58201499.62 - No -
Chongqing Changan Suzuki Automobile
Co. Ltd.
Purchase of
spare parts
- - No 40015153.39
Total 4019270690.83 11650101343.24 4766980922.93
The price of the Group’s purchase from related parties is based on contracts agreed by both parties.Note：The company calculated the actual amount of related party transactions according to the related parties under the same control
of the South Group and compared with the transaction amount approved at the beginning of the year.
(2) Goods sold and services offered
In RMB Yuan
Related parties Nature of the transaction Current amount Prior-period Amount
Changan Ford Automobile Co.Ltd. Sales of spare parts、staff support 856061.60 959683.96
Changan Ford Automobile Co.Ltd. -
Harbin branch
Sales of spare parts、staff support - -
Changan Ford Automobile Co. Ltd. -
Hangzhou branch
Sales of spare parts、staff support 20.37
Changan Mazda Automobile Co.Ltd. Sales of spare parts 2683010.71 1064339.48
Changan Mazda Engine Co. Ltd. Training fee 12830.19 -
Jiangling Holding Co. Ltd. Sales of spare parts、staff support - 92466850.38Nanjing Chelai Travel Technology Co.Ltd.
Car rental income 50442.48
Chongqing Changan Kuayue
Automobile Co. Ltd.
Income from trademark right 5913.00 26078.68
Hangzhou Chelizi Intelligent
Technology Co. Ltd.
Car rental income 8193799.97
Chongqing Changan Industrial (Group)
Co. Ltd.
Sales of spare parts 312427.84 -
Chongqing Changan Construction
Engineering Co. Ltd.
Electricity fee 19563.79 -
Sichuan Hongguang Machinery and
Electrics Co. Ltd.
Sales of spare parts 804913.61 965831.85
China Changan Automobile Co. Ltd. –
Chongqing Qingshan Transmission
Sales of vehicles and spare parts 270959.66 3754.72
Related parties Nature of the transaction Current amount Prior-period Amount
Branch
Sichuan Jianan Industrial Co. Ltd. Sales of spare parts - 3754.72
South Air International Co.Ltd. Sales of vehicles and spare parts - 4708.49
Sichuan Ningjiang Shanchuan
Machinery Co Ltd.Sales of vehicles and spare parts - 3754.72
Csgc Trw Chassis Systems Co.Ltd. Sales of vehicles and spare parts - 3754.72
Chongqing Changan Min Sheng
Logistics Co. Ltd.Sales of spare parts、Training fee 9384009.45 49034525.61
Chongqing Changan Min Sheng
Logistics Co. Ltd. – Yubei Branch
Electricity fee 292914.38
Guangxi Wanyou Auto Sales and
Service Co. Ltd.Sales of vehicles and spare parts 41791580.46 79266636.74
Nanning Wanyou Auto Sales and
Service Co. Ltd.Sales of vehicles and spare parts 17029211.44 18660666.94
Chengdu Wanyou Xiangyu Auto Sales
and Service Co. Ltd.Sales of vehicles and spare parts 414364744.60 564089962.66
Chongqing Anfu Automobile Marketing
Co. Ltd.
Sales of vehicles 34296238.49 4504052.51
China Changan Automobile Group
Tianjin Sales Co. Ltd.Sales of vehicles and spare parts 62048690.92 96595781.73
Chengdu Ningjiang Zhaohe Automobile
Components Co. Ltd.
Sales of spare parts 559797.07 -
Harbin Dongan Auto Engine Co. Ltd. Sales of spare parts 6860735.86 5807864.29
Harbin Dongan Automotive Engine
Manufacturing Co. Ltd.Sales of spare parts 11294757.38 541580.93
Wanyou Automobile Investment Co.Ltd.Sales of vehicles and spare parts 194731627.80 278840354.88
Chengdu Wanyou Auto Trade Service
Co. Ltd.
Sales of vehicles and spare parts 173518730.23 307793749.81
Chongqing Wanyou Economic
Development Co. Ltd.
Sales of vehicles and spare parts 392673110.16 466874730.20
Chongqing Wanyou Zunda Automobile
Sales & Service Co. Ltd. – Guangxi
Branch
Sales of vehicles and spare parts 34904.51
Chongqing Wanyou Zunda Automobile
Sales & Service Co. Ltd. – Guizhou
Branch
Sales of vehicles and spare parts 9017.16
Chongqing Wanyou Zunda Automobile
Sales & Service Co. Ltd. – Parts Branch
Sales of vehicles and spare parts 8275.85
Chongqing Wanyou Zunda Automobile
Sales & Service Co. Ltd. – Sichuan
Branch
Sales of vehicles and spare parts 85343.02
Related parties Nature of the transaction Current amount Prior-period Amount
Chongqing Wanyou Zunda Automobile
Sales & Service Co. Ltd. –Yunnan
Branch
Sales of vehicles and spare parts 210147045.26 318109175.14
Yunnan Wanyou Automobile Sales &
Service Co. Ltd.Sales of vehicles and spare parts 7825827.75 12136503.95
Guizhou Wanyou Automobile Sales &
Service Co. Ltd.Sales of vehicles and spare parts 27281012.14 27679119.48
Yunnan Xiangyu Automobile Sales &
Service Co. Ltd.Sales of vehicles and spare parts 57120893.29 58340829.40
Chongqing Wanyou Zunda Automobile
Sales & Service Co. Ltd. – Guangxi
Branch
Sales of vehicles and spare parts 41796231.44 57749959.33
Chongqing Wanyou Zunda Automobile
Sales & Service Co. Ltd. – Guizhou
Branch
Sales of vehicles and spare parts 16106957.12 41553601.57
Chongqing Wanyou Zunda Automobile
Sales & Service Co. Ltd. – Parts Branch
Sales of vehicles and spare parts 309384958.88 350671270.23
Chongqing Wanyou Zunda Automobile
Sales & Service Co. Ltd. – Sichuan
Branch
Sales of vehicles and spare parts 347551447.54 452909126.31
Chongqing Wanyou Zunda Automobile
Sales & Service Co. Ltd. –Yunnan
Branch
Sales of vehicles and spare parts 45082563.98 67497061.87
Panzhihua Wanyou Automobile Sales &
Service Co. Ltd.Sales of vehicles and spare parts - 11045.54
Ya'an Wanyou Automobile Sales &
Service Co. Ltd.Sales of vehicles and spare parts - 16589.56
Chongqing Wanyou Ducheng
Automobile Sales & Service Co. Ltd.
Sales of vehicles and spare parts - 72903.23
Chongqing Wanyou Ducheng
Automobile Sales & Service Co. Ltd. –
Zhongxian Branch
Sales of vehicles and spare parts 5998.70
Chongqing Wanyou Xingjian
Automobile Sales & Service Co. Ltd.
Sales of vehicles and spare parts - 71605.18
Luzhou Wanyou Automobile Service
Co. Ltd.
Sales of vehicles and spare parts - 53390.03
Chengdu Wanyou Automobile Sales &
Service Co. Ltd.Sales of vehicles and spare parts 3373560.20
Chongqing Changrong Machinery Co.
Ltd.Sales of spare parts 124339.62 3754.72
Chengdu Lingchuan Special Industry
Co. Ltd.
Sales of spare parts 2011.39 10007.55
Related parties Nature of the transaction Current amount Prior-period Amount
Chengdu Lingchuan Vehicle Oil Tank
Co. Ltd.
Sales of spare parts 1362120.82 -
Yunnan Xiyi Industries Co. Ltd. Sales of vehicles and spare parts 2876531.50 4070438.35
Chongqing Shangfang Automobile
Fittings Co. Ltd.
Sales of vehicles and spare parts 20037.74 35037.74
Chongqing Dajiang Xinda Vehicles
Shares Co. Ltd.Sales of vehicles and spare parts - -
Chongqing Dajiang Yuqiang Plastic Co.
Ltd.Sales of vehicles and spare parts 345391.14 -
Chongqing Jianshe Automobile
Air-conditioner Co. Ltd.
Sales of vehicles and spare parts 12037.74 3754.72
China South Industries Group Finance
Co. Ltd.
Sales of vehicles and spare parts 1260010.87 5333618.49
Southwest Ordnance Industry
Corporation
Sales of vehicles and spare parts -
Chengdu Wanyou Filter Co. Ltd. Sales of vehicles and spare parts 76460.18 3754.72
Chongqing Yihong Engineering Plastic
Products Co. Ltd.Sales of vehicles and spare parts 943.30 -
Chongqing Changan Suzuki Automobile
Co. Ltd.
Sales of raw materials and spare
parts
- 9470279.42
Total 2443950012.60 3373315244.55
The price of the Group’s purchase from related parties is based on contracts agreed by both parties.
(3) Related-party leasing
Rent assets to related parties
In RMB Yuan
Lessee
Type of leased
assets
Starting date Expiring date
Report period
recognized rental
Jiangling Holdings Co. Ltd.
A102
production line
2017.04.01 2019.03.31 1889756.40
Chongqing Changan Industrial (Group)
Co. Ltd.
Building 2018.01.01 2032.12.31 3283373.71
Rent assets from related parties
In RMB Yuan
Lessor
Type of
leased assets
Starting date Expiring date
Report period
recognized
rental
Chongqing Changan Real Estate
Development Co. Ltd.
Building 2019.1.1 2019.6.30 483861.90
Chongqing Changan Min Sheng
Logistics Co. Ltd. – Hebei Branch
Storeroom 2019.1.1 2019.12.31 364466.04
Chongqing Changan Real Estate
Development Co. Ltd.
Site 2019.1.1 2019.5.31 668740.00
Chongqing Changan Min Sheng
Logistics Co. Ltd.Storeroom
2018.9.20（Kunming） 2019.9.19（Kunming）
2599542.98
2018.9.6（Guangzhou） 2019.9.5（Guangzhou）
Chongqing Changan Min Sheng
Logistics Co. Ltd.Storeroom 2018.1.1 2018.12.31 6000000.00
Chongqing Changan Min Sheng
Logistics Co. Ltd.Storeroom
2018.9.4 2018.11.3（Beijing）
1153170.00
2018.9.6 2018.10.15（CHongqing）
(4) Other related transactions
Integrated service charges
In RMB Yuan
Related parties Nature of the transaction Report period Amount
Same period of last
period Amount
Changan Industries (Group)
Co. Ltd
Payment of land rental fees 13960191.76 15738619.47
Payment of building rental fees 2320098.28 2320098.28
Payment of utilities 41936461.05 41238737.71
Payment of fire fighting fees
Others 5598032.75 2604188.16
Total 63814783.84 61901643.62
Purchase of project materials
In RMB Yuan
Related parties Report period Amount
Same period of last period
Amount
Chongqing Changan Construction Co. Ltd 219003991.17 285684556.02
Chongqing Changan Min Sheng Logistics Co. Ltd. 510059.11 362735.93
Changan Industries (Group) Co. Ltd 6163.00 -
Chongqing wanyou engineering installation co. ltd - 49273687.28
Total 219520213.28 335320979.23
Staff expenses for technical supporting
In RMB Yuan
Related parties Report period Amount
Same period of last period
Amount
Changan Mazda Automobile Co.Ltd. 7242531.36 5113134.48
Changan Ford Automobile Co.Ltd. 10419283.74 10500543.45
Changan Mazda Engine Co. Ltd. 833481.46 -
Jiangling Holding Co. Ltd. 884649.40 -
Changan PSA Automobiles Co. Ltd. 242271.06 -
Hainan Anxinxing Information Technology Co. Ltd. 652302.36 -
Changan Ford Automobile Co.Ltd. - 1539750.64
Total 20274519.38 17153428.57
Techonology development service charges
In RMB Yuan
Related parties Report period Amount
Same period of last period
Amount
Jiangling Holdings Co. Ltd. 1886792.45-
Changan Ford Automobile Co.Ltd. 769811.32 -
Harbin Dongan Auto Engine Co. Ltd. 11320754.71 -
Total 12090566.03 1886792.45-
Collection of trademark use rights fees
In RMB Yuan
Related parties Report period Amount
Same period of last period
Amount
Chongqing Changan Kuayue Automobile Co. Ltd. 8689641.51 6483396.23
Related party monetary funds
In RMB Yuan
Related parties Ending Amount Beginning Amount
China South Industries Group Finance Co. Ltd 4716330300.07 3312617903.21
Changan Automobile Finance Co. Ltd 500000000.00 1000000000.00
In the first half of 2019 the annual rate of return of the company in the financial limited liability company of China South Industries
Group Finance Co. Ltd and Changan automobile finance co. ltd is 1.97% and 3.77 % respectively.
Borrowing
Short-term borrowing
In RMB Yuan
Related parties Ending Amount Beginning Amount
China South Industries Group Finance Co. Ltd 210000000.00 190000000.00
Interest income of deferred payment
In RMB Yuan
Related parties Report period Amount
Same period of last period
Amount
Wanyou Automobile Investment Co. Ltd. 0.00 2186.32
Chengdu Wanyou Xiangyu Auto Sales and Service Co. Ltd. 373037.00 116762.05
China Changan Automobile Group Tianjin Sales Co. Ltd. 14735.00 8617.09
Chengdu Wanyou Auto Trade Service Co. Ltd. 193056.00 48452.99
Yunnan Wanyou Automobile Sales & Service Co. Ltd. 349378.00 64533.33
Guizhou Wanyou Automobile Sales & Service Co. Ltd. 97614.00 28282.91
Guangxi Wanyou Automobile Sales & Service Co. Ltd. 64825.00 0.00
Nanning Wanyou Automobile Sales & Service Co. Ltd. 34018.00 0.00
Chongqing Wanyou Economic Development Co. Ltd. 90192.00 0.00
Chongqing Wanyou Economic Development Co. Ltd. -
Jiangnan Branch
63363.00 0.00
Yunnan Xiangyu Auto Sales and Service Co. Ltd. 78469.00 0.00
Total 1358687.00 268834.69
5. Payment and receivables of related parties
Payment receivables of related listed companies
In RMB Yuan
Items Related parties
Ending balance Beginning balance
Book balance
Provision
for
bad-debts
Book balance
Provision
for
bad-debts
Notes
receivable
Wanyou Automobile Investment Co. Ltd. 1082530000.00 - 1588720000.00 -
Notes
receivable
Chongqing Wanyou Economic
Development Co. Ltd.
- - 9050000.00 -
Notes
receivable
Yunnan Wanyou Automobile Sales and
Service Co. Ltd
- - 5000000.00 -
Notes
receivable
Changan Ford Automobile Co.Ltd. - - 2128658.11 -
Notes
receivable
Chongqing Changan Kuayue Automobile
Marketing Co. Ltd.
7000000.00 - - -
Items Related parties
Ending balance Beginning balance
Book balance
Provision
for
bad-debts
Book balance
Provision
for
bad-debts
Notes
receivable
Harbin Dongan Automotive Engine
Manufacturing Co. Ltd.
778139.65 - - -
Subtotal 1090308139.65 - 1604898658.11 -
Account
receivable
Jiangling Holding Co. Ltd. 61931302.44 - 54670170.21 -
Account
receivable
Harbin Dongan Automotive Engine
Manufacturing Co. Ltd.
8604540.60 - 32628379.07 -
Account
receivable
Changan Ford Automobile Co.Ltd. 182374.15 - 26562801.86 -
Account
receivable
Chongqing Changan Minsheng Logistics
Co. Ltd
29333952.45 - 24295732.61 -
Account
receivable
Chongqing Changan Kuayue Automobile
Co. Ltd.
12567120.00 - 13567425.09 -
Account
receivable
Changan PSA Automobiles Co. Ltd. 61126194.06 - 9377634.60 -
Account
receivable
Yunnan Wanyou Automobile Sales &
Service Co. Ltd.
507107.71 - 8494704.49 -
Account
receivable
Chengdu Wanyou Trading Co. Ltd. - - 5610252.52 -
Account
receivable
Hangzhou Chelizi Intelligent Technology
Co. Ltd.
9741647.00 - 5564800.00 -
Account
receivable
Changan Mazda Engine Co. Ltd. - - 4228792.00 -
Account
receivable
Chongqing Changan Property Management
Co. Ltd.
- - 426120.00 -
Account
receivable
Chongqing Wanyou Zunda Automobile
Sales & Service Co. Ltd.- - 65804.25 -
Account
receivable
Chongqing Changan Industrial (Group)
Co. Ltd.
651664.44 - - -
Account
receivable
Harbin Dongan Auto Engine Co. Ltd. 13200.00 - - -
Account
receivable
Chongqing Changrong Machinery Co. Ltd. 131800.00 - - -
Account Chongqing Shangfang Automobile Fittings 17260.00 - - -
Items Related parties
Ending balance Beginning balance
Book balance
Provision
for
bad-debts
Book balance
Provision
for
bad-debts
receivable Co. Ltd.
Account
receivable
Chongqing Jianshe Automobile
Air-conditioner Co. Ltd.
12760.00 - - -
Subtotal 184820922.85 - 185492616.70 -
Other
receivable
Changan Ford Automobile Co.Ltd. - - 124312677.99 -
Other
receivable
Hafei Motor Co. Ltd. - - 1500000.00 -
Other
receivable
Harbin Dongan Auto Engine Co. Ltd. 286000.00 - 268000.00 -
Other
receivable
Chongqing Changan Minsheng Logistics
Co. Ltd
- - 47975.40 -
Other
receivable
Changan Ford Automobile Co. Ltd. -
Harbin branch
124312677.99
Subtotal 124598677.99 - 126128653.39 -
Advanced
payment
Changan PSA Automobiles Co. Ltd. 8826473.38 - 8826473.38 -
Advanced
payment
Guangxi Wanyou Auto Sales and Service
Co. Ltd.
- 124497.13 -
Subtotal 8826473.38 - 8950970.51 -
Accounts payable to related parties of listed companies
In RMB Yuan
Items Related parties Ending balance
Beginning
balance
Notes
payable
Harbin Dongan Auto Engine Co. Ltd. 403600000.00 460430000.00
Notes
payable
Chongqing Jianshe Automobile Air-conditioner Co. Ltd. 259560057.89 298387280.00
Notes
payable
Chongqing Changan Minsheng Logistics Co. Ltd 209934301.71 221925743.41
Notes
payable
South Air International Co.Ltd. 128210000.00 149430000.00
Notes China Changan Automobile Co. Ltd. –Chongqing Qingshan Transmission 4330000.00 130270000.00
Items Related parties Ending balance
Beginning
balance
payable Branch
Notes
payable
Chongqing Dajiang Yuqiang Plastic Co. Ltd. 86280000.00 127940000.00
Notes
payable
Harbin Dongan Automotive Engine Manufacturing Co. Ltd. 217660000.00 112940000.00
Notes
payable
Chongqing Jianshe Automobile Air-conditioner Co. Ltd. 49270000.00 50060000.00
Notes
payable
Chengdu Wanyou Filter Co. Ltd. 31590000.00 23950000.00
Notes
payable
Southern Faurecia Auto Parts Co. Ltd. 10350000.00 22090000.00
Notes
payable
Hubei Xiaogan Huazhong Auto Lamp Co. Ltd. 17800000.00 13860000.00
Notes
payable
Sichuan Ningjiang Shanchuan Machinery Co. Ltd. 11080000.00 9160000.00
Notes
payable
Sichuan Jianan Industrial Co. Ltd. 12400000.00 8650000.00
Notes
payable
Chengdu Lingchuan Special Industry Co. Ltd. 10490000.00 8000000.00
Notes
payable
Chongqing Changfeng Jiquan Machinery Co. Ltd. 590000.00 7900000.00
Notes
payable
Chengdu Jialing Huaxi Optical & Precision Machinery Co. Ltd. 8050000.00 7270000.00
Notes
payable
Chongqing Yihong Engineering Plastic Products Co. Ltd. 1540000.00 4500000.00
Notes
payable
Chengdu Huachuan Electric Equipment Co. Ltd. 3920000.00 2490000.00
Notes
payable
Sichuan Hongguang Automobile Electrical Co. Ltd. 1360000.00 2240000.00
Notes
payable
Changan Ford Automobile Co.Ltd. 0.00 1749094.40
Notes
payable
Sichuan Ningjiang Shanchuan Machinery Co. Ltd. Longchang Shock
Absorber Branch
2900000.00 1370000.00
Notes
payable
Chongqing Shangfang Auto Parts Co. Ltd. 1530000.00 1150000.00
Notes Chongqing Dajiang Jiexin Forging Co. Ltd. 0.00 1120000.00
Items Related parties Ending balance
Beginning
balance
payable
Notes
payable
Chengdu Ningjiang Zhaohe Automobile Components Co. Ltd. 14640000.00
小计 1487084359.60 1666882117.81
Account
payable
Chongqing Nexteer steering system co. Ltd 248328304.82 249837358.48
Account
payable
Harbin Dongan Auto Engine Co. Ltd. 173010450.18 161417419.68
Account
payable
Csgc Trw Chassis Systems Co.Ltd. 67760931.46 106558182.07
Account
payable
China Changan Automobile Co. Ltd. –Chongqing Qingshan Transmission
Branch
106037264.34 104125292.03
Account
payable
Sichuan Jianan Industrial Co. Ltd. 59919255.16 80657220.16
Account
payable
Southern Inte Air Conditioning Co. Ltd. 47832555.32 76175712.19
Account
payable
Chongqing Wanyou Economic Development Co. Ltd. 53619585.33 66540872.82
Account
payable
Jiangling Holding Co. Ltd. 102373.73 53715373.73
Account
payable
Chongqing Dajiang Yugqiang Plastic Products Co. Ltd. 15704492.67 46084064.75
Account
payable
Chongqing Dajiang Xinda Automobile Co. Ltd. 1764432.05 45780498.50
Account
payable
Harbin Dongan Automotive Engine Manufacturing Co. Ltd. 50632826.43 44767814.32
Account
payable
Southern Faurecia Auto Parts Co. Ltd. 32430193.79 41239427.48
Account
payable
Chengdu Huachuan Electric Equipment Co. Ltd. 13820646.03 33208038.95
Account
payable
Chongqing Changan Minsheng Logistics Co. Ltd 9706700.97 27674139.19
Account
payable
Chongqing Jianshe Automobile Air-conditioner Co. Ltd. 18028522.00 27597844.39
Account
payable
Chengdu Ningjiang Zhaohe Auto Parts Co. Ltd. 36111454.21 24826794.96
Items Related parties Ending balance
Beginning
balance
Account
payable
Hubei Xiaogan Huazhong Automobile Light Co. Ltd. 13981161.02 21513647.99
Account
payable
Chengdu Wanyou Filter Co. Ltd. 19377897.54 21426685.22
Account
payable
Chengdu Lingchuan Vehicle Oil Tank Co. Ltd. 9751045.39 17663383.80
Account
payable
Sichuan Ningjiang Shanchuan Machinery Co. Ltd. 13074343.68 17161138.52
Account
payable
Chongqing Changfeng Jiyu Machinery Co. Ltd. 10197431.07 9917256.01
Account
payable
Sichuan Ningjiang Shanchuan Machinery Co Ltd. - Longchang Shock
Absorber Branch
2448737.54 9586665.78
Account
payable
Chongqing Shangfang Auto Parts Co. Ltd. 5462008.12 9100420.32
Account
payable
Chengdu Lingchuan Special Industry Co. Ltd. 1934670.34 8664902.18
Account
payable
Yunnan Xiyi Industries Co. Ltd. 8831367.95 6535900.15
Account
payable
Chongqing Qingshan Transmission Sales Co. Ltd. 5254023.60 5262876.71
Account
payable
Changan Ford Automobile Co. Ltd 0.00 4085436.29
Account
payable
Chengdu Jialing Huaxi Optical & Precision Machinery Co. Ltd. 1658863.93 2709675.36
Account
payable
Chongqing Changrong Machinery Co. Ltd. 1576019.76 2686306.64
Account
payable
Chongqing Yihong Engineering Plastic Products Co. Ltd. 1271100.45 2524005.52
Account
payable
Changan Industries Group Co. Ltd 204484.37 2215125.47
Account
payable
Chongqing Changan Kuayue Automobile Co. Ltd. 0.00 1263841.59
Account
payable
Sichuan Hongguang Automobile Electrical Co. Ltd. 811045.59 1187095.50
Account
payable
Hafei Automobile Co. Ltd. 661117.68 661117.68
Items Related parties Ending balance
Beginning
balance
Account
payable
Chongqing Dajiang Jiexin Forging Co. Ltd. 695944.05 282878.46
Account
payable
Chongqing Automobile Air Conditioner Co. Ltd. 205041.51 177312.15
Account
payable
Chongqing Changan Construction Co. Ltd 5063.37 119514.45
Account
payable
Chongqing Jialing Yimin Special Equipment Co. Ltd. 104496.50 104496.50
Account
payable
Chengdu Guangming Tianzhong Environmental Protection Technology Co.
Ltd.
83316.71 85473.47
Account
payable
Chongqing Xiyi Automobile Connecting Rod Co. Ltd. 46793.40 67466.78
Account
payable
Changan Ford Automobile Co. Ltd 哈尔滨分公司 3483034.37 -
Account
payable
Changan PSA Automobiles Co. Ltd. 343350344.94 -
Account
payable
Hangzhou Chelizi Intelligent Technology Co. Ltd. 3024321.25 -
Account
payable
Changan Automobile Group Co Ltd. 0.00 -
Account
payable
Beijing Beiji Mechanical and Electrical Industry Co. Ltd. 8968.78 -
Account
payable Chongqing Dajiang Guoli Precision Machinery Manufacturing Co. Ltd.
27774621.58 -
Subtotal 1410087252.98 1335208676.24
Advance
receipts
Chongqing Wanyou Economic Development Co. Ltd. 60085551.48 30602220.89
Advance
receipts
Guizhou Wanyou Automobile Sales & Service Co. Ltd. 8712314.88 24770462.88
Advance
receipts
Chengdu Wanyou Xiangyu Auto Sales and Service Co. Ltd. 47181483.86 23961768.86
Advance
receipts
Chongqing Changan Kuayue Automobile Co. Ltd 0.00 9833525.00
Advance
receipts
China Changan Automobile Group Tianjin Sales Co. Ltd. 2829066.78 7694948.94
Advance Yunnan Wanyou Automobile Sales & Service Co. Ltd. 0.00 6741068.88
Items Related parties Ending balance
Beginning
balance
receipts
Advance
receipts
Changan Industries Group Co. Ltd. 0.00 5289712.91
Advance
receipts
Changan Ford Mazda Engine Co. Ltd. 3256185.92 3347884.03
Advance
receipts
Chongqing Wanyou Zunda Automobile Sales & Service Co. Ltd. 10474248.06 2874902.88
Advance
receipts
Guangxi Wanyou Auto Sales and Service Co. Ltd. 2452974.14 2031019.64
Advance
receipts
Chongqing Anfu Automobile Marketing Co. Ltd. 7557144.00 1764144.00
Advance
receipts
Chengdu Wanyou Auto Trade Service Co. Ltd. 12626321.30 1031647.35
Advance
receipts
Nanning Wanyou Auto Sales and Service Co. Ltd. 978391.87 1000769.87
Advance
receipts
Yunnan Xiangyu Automobile Sales & Service Co. Ltd. 603506.67 820739.67
Advance
receipts
Hafei Motor Co. Ltd. 670500.00 670500.00
Advance
receipts
Wanyou Automobile Investment Co. Ltd. 4543310.00 394254.00
Advance
receipts
Kunming Wanning Automobile Sales & Service Co. Ltd. 0.00 36548.04
Advance
receipts
Chongqing Shangfang Auto Parts Co. Ltd. 0.00 3980.00
Advance
receipts
Kunming Wanning Automobile Sales & Service Co. Ltd. 0.00 2037.62
Advance
receipts
Luzhou Wanyou Automobile Service Co. Ltd. 0.00 121.00
Advance
receipts
Chongqing Changan Minsheng Logistics Co. Ltd 0.00 -
Advance
receipts
Southwest Ordnance Industry Corporation 0.00 -
Advance
receipts
Southern Inte Air Conditioning Co. Ltd. 0.00 -
Advance Changan Mazda Automobile Co.Ltd. 1423660.83 -
Items Related parties Ending balance
Beginning
balance
receipts
Advance
receipts
Changan Automobile Finance Co. Ltd. 2400.00 -
Advance
receipts
Changan Automobile Group Co Ltd. 153207.00 -
Advance
receipts
Changan Automobile Group Co Ltd.重庆青山变速器分公司 1.57 -
Advance
receipts
Bazhong Wanyou Automobile Sales & Service Co. Ltd. 50000.00 -
Subtotal 163600268.36 122872256.46
Other
payables
Chongqing Changan Minsheng Logistics Co. Ltd 391165781.92 105930160.43
Other
payables
China South Industries Group Co. Ltd. 0.00 29580000.00
Other
payables
Changan PSA Automobiles Co. Ltd. 0.00 26007857.90
Other
payables
Chongqing Changan Construction Engineering Co. Ltd. 13835695.04 13471837.97
Other
payables
Changan Industries Group Co. Ltd. 14929972.09 8784882.05
Other
payables
Chongqing Changan Property Management Co. Ltd. 2892305.28 2252567.36
Other
payables
Chongqing Wanyou Zunda Automobile Sales & Service Co. Ltd. 550000.00 550000.00
Other
payables
Chongqing Qingshan Transmission Sales Co. Ltd. 0.00 439120.00
Other
payables
Chongqing Changan Real Estate Development Co. Ltd. 0.00 277907.42
Other
payables
Guizhou Wanyou Automobile Sales & Service Co. Ltd. 26215.00 218604.28
Other
payables
Chongqing Anfu Automobile Marketing Co. Ltd. 100000.00 200000.00
Other
payables
Changan Ford Mazda Engine Co. Ltd. 0.00 144115.79
Other
payables
Chengdu Wanyou Filter Co. Ltd. 120000.00 120000.00
Items Related parties Ending balance
Beginning
balance
Other
payables
Chongqing Wanyou Economic Development Co. Ltd. 0.00 111551.22
Other
payables
Chengdu Wanyou Xiangyu Auto Sales and Service Co. Ltd. 81847.00 75330.00
Other
payables
Chongqing Dajiang Xinda Automobile Co. Ltd. 0.00 50000.00
Other
payables
Southern Inte Air Conditioning Co. Ltd.空调有限公司 0.00 35844.50
Other
payables
Yunnan Wanyou Automobile Sales & Service Co. Ltd. 0.00 26100.00
Subtotal 423701816.33 188275878.92
XIII. Share-based payments
1. General information
2019.06
The total amount of the employee services as a result of the share-based
payments
23961900.00
The equity settled share based payments are as follows:
2019.06
The accumulated amount of equity settled share-based payments included in
capital reserve
23961900.00
The amount of equity settled share-based payments included in expense 0.00
2. Share-based payment scheme
On 23 September 2016 the share option was approved to be granted on 23 September 2016 by the 12th meeting
of the seventh session of the Board of Directors and the 8th meeting of the seventh session of Board of
Supervisors. According to the share option scheme the Company granted 29140000 options to 202 employees
conferring rights to purchase 1 A share of Changan Automobile for each option before the expiration date. Share
options are granted to directors chief executive officers and key technical and management personnel.The share option will expire in 5 years. After the vesting period of 24 month since the grant date the option shall
be exercised in three periods. In each exercise period 1/3 of the total options could be exercised when the
prescribed performance conditions are met. The exercise price is RMB14.12 per share. The options granted shall
be exercised before the expiration date. The share should not be exercised unless the prescribed conditions are met.
The exercisable shares not exercised in above periods will be written off by the Company. The company has
disclosed in June 1 2017 "The 2016 annual notice of the implementation of equity distribution".According to the
company's stock option incentive plan (Revised Draft) the relevant provisions on the stock option price
adjustment if dividends and capital reserve capitalization stock dividends stock split delivery allotment
issuance or reduced matters occur before the stock exercise the stock option price should be adjusted. The
exercise price of the adjusted stock option is 13.478 yuan. The incentive object must be exercised within the
validity period of the option exercise. If the exercise conditions are not met the current stock options may not be
exercised. If part of the stock options that meet the exercise conditions but are not exercised in the above exercise
period are cancelled by the company.The performance indicators of the share option includes:
(1) Return on equity (ROE)
(2) Net profit growth rate attributable to owners
(3) Economic value added (EVA) and
(4) The ratio of prime operating revenue to operating revenue
The above net profit and ROE are based on net profit and weighted average net assets attributable to owners
deducting non-recurring gains and losses.The exercise terms of share options:
Exercise
Period
Exercise
Ratio
Exercise Time Exercise Terms
The 1st
exercise
period
The 1st trading day since 2
4 month after the grant date
to the last trading day sinc
e 36 month after the grant
date
2017 net profit growth rate based on 2015 average
growth rate ≥3.2%(growth amount equivalent to
RMB10182000000);
ROE≥15%
The above indicators≥benchmark average and ≥7
5 quartile
△EVA>0;
The ratio of prime operating revenue to operating
revenue≥95%
The 2nd
exercise
period
The 1st trading day since 3
6 month after the grant date
to the last trading day sinc
e 48 month after the grant
date
2018 net profit growth rate based on 2015 avera
ge growth rate ≥3.2%(growth amount equivalent t
o RMB10507000000);
ROE≥15%
The above indicators≥benchmark average and ≥7
5 quartile
△EVA>0;
The ratio of prime operating revenue to operating
revenue≥95%
The 3rd
exercise
period
The 1st trading day since 4
8 month after the grant date
to the last trading day sinc
2019 net profit growth rate based on 2015 avera
ge growth rate ≥3.2%(growth amount equivalent t
o RMB10844000000);
149
e 60 month after the grant
date
ROE≥15%
The above indicators≥benchmark average and ≥7
5 quartile
△EVA>0;
The ratio of prime operating revenue to operating
revenue≥95%
On the grant date the fair value of the above stock options of the Company was RMB 139527600.00. As the
performance appraisal target of the first and second exercise periods of the stock option incentive plan of the
company has not reached the target and a total of 19 incentive objects have respectively terminated the labor
contract with the company the company no longer meets the stock option incentive conditions. On December 31
2018 a total of 20.33 million stock options were cancelled. After the cancellation the company's stock options
issued under the plan were 8.81 million and the corresponding fair value was RMB 42183885.90. The share
option fee confirmed by the company in June 2019 is RMB 0.00.The fair value of the equity-settled share option is determined using Black-Scholes model based on the estimate in
accordance with the terms and conditions of the share options. The input variables are as follows:
Valuation factors 2016
Dividend rate (%) 0%
Expected volatility (%) 29.78%
Historical volatility (%) 29.78%
Risk-free rate (%) 2.4987%
Expected duration (year) 4
Share price as at the grant date (Yuan) 15.43
The expected duration of the option is based on the historical data of the past which is not necessarily reflected in
the exercise of the right in future.The expected volatility is based on the assumption that the historical volatility
reflects the future trend but not necessarily the actual results.XIV. Commitments and Contingencies
1. Significant commitments
Investment commitment
By June 30th 2019 the group has no investment commitment that has been signed but not yet fully fulfilled.
2. Contingencies
By June 30th 2019 the company has no significant contingencies that need to be published.
150
XV. Events after the balance sheet date
1. Significant non-adjusting events
□ Applicable √Not Applicable
2. Distribution of profit
□ Applicable √ Not Applicable
3. Sales return
□ Applicable √ Not Applicable
XVI. Other important events
1. Correction of accounting error of earlier stage
□ Applicable √ Not Applicable
2. Debt restructuring
□ Applicable √ Not Applicable
3. Asset replacement
□ Applicable √ Not Applicable
4. Annuity plan
□ Applicable √ Not Applicable
5. Discontinuing operation
□ Applicable √ Not Applicable
6. Information on business branch
Identify business branch of the group according to internal organization structure management requirements internal reporting rules
and identify the report and information disclosed of the brand based on the identified branch.Identify business branch of the group according to internal organization structure management requirements internal reporting rules
and identify the report and information disclosed of the brand based on the identified branch.business branch refers to the component of the group that meets the following conditions:
(1) the component has income and expenditure incurred in routine activities;
(2) the management of the company regularly evaluates the operation performance of the component to decide the company’s
151
resource distribution and evaluate its overall performance
(3) The group receives related accounting information on the financial situation operation performance and cash flow.
If two or more components have similar economic features and meet the conditions they should be consolidated into one branch.Income and profit of the group consists of automobile manufacturing and domestic sales. Main asset of the group is in China. The
management of the group evaluates the performance of the group as a whole. Thus report of the branch is not included in this year’s
report.XVII. Notes to the main items of the parent company’s financial statements
1. Account Receivables
(1) Account Receivables
Disclosure of accounts receivable
In RMB Yuan
Items
2019
Book balance Provision for bad-debts
Amount (%) Amount (%)
Individual assessment of credit expected
loss and provision for bad debts
Assess bad debt provision for expected
credit expected loss according to credit
risk characteristics combination
6962658706.03 100.00 17198989.14 100.00
Total 6962658706.03 100.00 17198989.14 100.00
In RMB Yuan
Items
2018
Book balance Provision for bad-debts
Amount (%) Amount (%)
Individually significant amount and
account receivables of individually
provision for bad debts
74433396.10 1.31 - -
Account receivables of provision for bad-debts calculated and extracted by groups
Group 1: account receivables of
provision for bad-debts calculated and
extracted by aging analysis
50150446.67 0.88 15559782.05 31.03
Group 2: Account receivables for
related parties
5570136618.97 97.81 - -
Group subtotal 5620287065.64 98.69 15559782.05 0.28
Notindividually significant amount but
other receivables of individually
- - - -
provision for bad debts
Total 5694720461.74 100 15559782.05 0.27
The parent company's portfolio of expected credit losses based on credit risk assessment is as follows:
In RMB Yuan
Account receivable age
Estimated book balance for
default
Expected credit
loss rate
Provision for bad-debts
Within 1 year 4786444085.47 0.00 1.30
1 to 2 years 1175736910.88 0.09 1103078.60
2 to 3 years 651568851.27 0.62 4010976.73
3 to 4 years 130204659.05 -
4 to 5 years 137850362.59 -
Over 5 years 80853836.77 14.95 12084932.51
Total 6962658706.03 0.24 17198989.14
On June 30 2019 the top five accounts receivable totalled RMB 5631531067.57， accounting for 80.88% of the total accounts
receivable (2018：RMB 4575962128.25，accounting for 80.35% of the total accounts receivable)
Provision for bad debts withdrawn recovered or reversed in the current period
In RMB Yuan
Items Beginning
Current change amount
Beginning
Provision
Withdrawn
or recovered
Reversed
Bad debt provision of accounts
receivable
15559782.05 1706307.09 67100.00 17198989.14
Total 15559782.05 1706307.09 67100.00 17198989.14
2. Other receivables
In RMB Yuan
Items Ending Beginning
Interest receivable 4581253.52 17432805.54
Dividend receivable 74897909.69
Other receivables 2420936251.89 2326885353.29
Total 2500415415.10 2344318158.83
Other receivables
The changes in bad debt provision for other receivables based on 12-month expected credit losses and the entire lifetime expected
credit losses are as follows（Only for 2019）：
In RMB Yuan
Bad debt provision
The first stage The second stage The second stage
Total
Expected credit
losses in the next 12
months
Expected credit loss
for the entire life
(Single evaluation)
Expected credit loss
for the entire life
(Group evaluation)
Balance on January 1 2019 261669.32 341762.08 603431.40
In this period Balance on January
1 2019
- - - -
--Transfer to the second stage -29326.52 29326.52 -
--Transfer to the third stage -
--Turn back to the second stage -
--Turn back to the first stage -
Current provision 2949782.81 825.21 2950608.02
Current return 208560.86 208560.86
Current reselling -
Current verification -
Other changes -
Total 232342.80 2949782.81 163352.95 3345478.56
The changes in the balance of other receivables are as follows：
In RMB Yuan
Bad debt provision
The first stage The second stage The second stage
Total
Expected credit
losses in the next 12
months
Expected credit loss
for the entire life
(Single evaluation)
Expected credit loss
for the entire life
(Group evaluation)
Balance on January 1 2019 2322255398.35 4436899.38 2326692297.73
In this period Balance on January
1 2019
- - - -
--Transfer to the second stage -586530.34 586530.34 -
--Transfer to the third stage -
--Turn back to the second stage -
--Turn back to the first stage -
New in this period 94849311.69 2949782.81 2531268.26 100330362.76
Derecognition 2740930.04 2740930.04
Current verification -
Other changes -
Total 2416518179.70 2949782.81 4813767.94 2424281730.45
Other receivables are described by type（Only for 2018）：
In RMB Yuan
Items
Beginning
Book balance Provision for bad-debts
Amount (%) Amount (%)
Individually significant amount and account receivables of
individually provision for bad debts
1720350524.62 73.91 - -
Account receivables of provision for bad-debts calculated and extracted by groups
Group 1: other receivables of provision for bad-debts calculated
and extracted by aging analysis
118981025.65 5.12 603431.40 0.51
Group 2: other receivables of provision for bad-debts calculated
and extracted by related parties
488157234.42 20.97 - -
Group subtotal 607138260.07 26.09 603431.40 0.10
no Individually significant amount but other receivables of
individually provision for bad debts
- - - -
Total 2327488784.69 100 603431.40 0.03
3. Long-term equity investment
In RMB Yuan
Invested in
Accounting
method
capitalized cost
beginning
amount
increase/decrease ending amount
Share
proportion
in the
company
invested
(%)
Voting
proportion
in the
company
invested
(%)
Explanatio
n for the
difference
between
shareholdin
g
percentage
and voting
percentage
Impa
irme
nt
impairme
nt
provision
in current
period
cash bonus
in current
period
1、Joint ventures
Jiangling Holding Co. Ltd. Equity 1008511522.00 2493754915.53 -236679161.41 2257075754.12 50.00% 50.00% -
Changan Ford Automobile Co. Ltd Equity 975232926.29 3709784507.11 -388312379.14 3321472127.97 50.00% 50.00% -
Changan Mazda Automobile Co.Ltd. Equity 1097839635.00 2472626663.41 431236189.88 2903862853.29 50.00% 50.00% -
Changan Ford Mazda Engine Co. Ltd. Equity 786734634.10 827803757.96 22279051.96 850082809.92 50.00% 50.00% -
Changan PSA Automobiles Co. Ltd. Equity 3807841700.00 1456519068.74 -37577002.31 1418942066.43 50.00% 50.00% -
Changan Weilai New Energy
Automobile Technology Co. Ltd.
Equity 49000000.00 44065513.91 -16493522.92 27571990.99 50.00% 50.00% -
2、Associated Enterprises
Chongqing Changan Kuayue
Automobile Co. Ltd
Equity 61800885.00 116588234.97 39038877.69 155627112.66 34.00% 34.00% -
Chongqing Changan Kuayue
Automobile Marketing Co. Ltd.
Equity 1.00 34.00% 34.00% -
Invested in
Accounting
method
capitalized cost
beginning
amount
increase/decrease ending amount
Share
proportion
in the
company
invested
(%)
Voting
proportion
in the
company
invested
(%)
Explanatio
n for the
difference
between
shareholdin
g
percentage
and voting
percentage
Impa
irme
nt
impairme
nt
provision
in current
period
cash bonus
in current
period
Beijing Fang’an Xinyue taxi Co. Ltd Equity 6000000.00 21.00% 21.00% -
Chongqing Auto Finance Co. Ltd. Equity 1805000000.00 2030617157.41 46724451.22 2077341608.63 29.00% 29.00% -
Hainan Anxinxing Information
Technology Co. Ltd.
Equity 6000000.00 5536555.21 -775195.24 4761359.97 30.00% 30.00% -
Nanjing Chelai Travel Technology Co.Ltd.
Equity 2000000.00 1813616.14 -238955.00 1574661.14 10.00% 10.00% -
Hunan Guoxin Semiconductor
Technology Co. Ltd.
Equity 25000000.00 25000000.00 -145569.13 24854430.87 25.00% 25.00% -
Nanjing Leading Equity Investment
Partnership
Equity 858267717.00 846264828.30 846264828.30 16.00% 16.00% -
Nanjing Lingxing Equity Investment
Management Co. Ltd.
Equity 1500000.00 1500000.00 1500000.00 15.00% 15.00% -
3、Subsidiaries
Nanjing Changan Automobile Co. Ltd. Cost 422533259.00 422533259.00 422533259.00 84.74% 84.74% -
Hebei Changan Automobile Co. Ltd. Cost 438223236.00 438223236.00 438223236.00 95.06% 95.06% -
Chongqing Changan Automobile
International Sales Service Co. Ltd.
Cost 13068581.00 13068581.00 13068581.00 100.00% 100.00% -
Invested in
Accounting
method
capitalized cost
beginning
amount
increase/decrease ending amount
Share
proportion
in the
company
invested
(%)
Voting
proportion
in the
company
invested
(%)
Explanatio
n for the
difference
between
shareholdin
g
percentage
and voting
percentage
Impa
irme
nt
impairme
nt
provision
in current
period
cash bonus
in current
period
Chongqing Changan Automobile
Customer Service Co. Ltd.
Cost 29700000.00 29700000.00 29700000.00 100.00% 100.00% -
Chongqing Changan Chelian
Technology Co. Ltd.
Cost 88500000.00 88500000.00 88500000.00 100.00% 100.00% -
Chongqing Changan Special Vehicle
Co. Ltd.
Cost 2500000.00 2500000.00 2500000.00 50.00% 50.00% -
Chongqing Changan Europe Design
Center Co. Ltd
Cost 155469913.50 155469913.50 155469913.50 100.00% 100.00% -
Chongqing Changan new Engergy
Automobile Co. Ltd
Cost 49194195.00 49194195.00 49194195.00 100.00% 100.00% -
Changan United Kingdom R&D Center
Co. Ltd.
Cost 250093850.95 236387395.40 13706455.55 250093850.95 100.00% 100.00% -
Beijing Changan Automotive
engineering and Technology Reseach
Co. Ltd.
Cost 1000000.00 1000000.00 1000000.00 100.00% 100.00% -
Changan Japan Design Center Co. Ltd. Cost 1396370.15 1396370.15 1396370.15 100.00% 100.00% -
Changan United States R&D Center Cost 10243460.00 10243460.00 10243460.00 100.00% 100.00% -
Invested in
Accounting
method
capitalized cost
beginning
amount
increase/decrease ending amount
Share
proportion
in the
company
invested
(%)
Voting
proportion
in the
company
invested
(%)
Explanatio
n for the
difference
between
shareholdin
g
percentage
and voting
percentage
Impa
irme
nt
impairme
nt
provision
in current
period
cash bonus
in current
period
Co. Ltd.
Baoding Changan Bus Manufacturing
Co. Ltd.
Cost 176002613.18 176002613.18 176002613.18 100.00% 100.00% -
Hefei Changan Automobile Co. Ltd Cost 35367765.23 35367765.23 35367765.23 100.00% 100.00% -
Changan Automobile Russia Co. Ltd. Cost 251242589.15 1242589.15 250000000.00 251242589.15 100.00% 100.00% -
Changan Brazil Holding Co. Ltd Cost 2584556.97 2584556.97 2584556.97 100.00% 100.00% -
Shenzhen Changan New Engergy
Automobile Service Co. Ltd
Cost 184800000.00 148000000.00 36800000.00 184800000.00 100.00% 100.00% -
Nanjing Changan New Energy
Automobile Sales & Service Co. Ltd.
Cost 50000000.00 50000000.00 50000000.00 100.00% 100.00% -
Fuzhou Changan New Energy
Automobile Sales & Service Co. Ltd.
Cost 2000000.00 2000000.00 2000000.00 100.00% 100.00% -
Xiamen Changan New Energy
Automobile Sales & Service Co. Ltd.
Cost 2000000.00 2000000.00 2000000.00 100.00% 100.00% -
Guangzhou Changan New Energy
Automobile Sales & Service Co. Ltd.
Cost 4000000.00 4000000.00 4000000.00 100.00% 100.00% -
Chongqing Changan New Energy Cost 1238742571.54 1238742571.54 1238742571.54 100.00% 100.00% -
Invested in
Accounting
method
capitalized cost
beginning
amount
increase/decrease ending amount
Share
proportion
in the
company
invested
(%)
Voting
proportion
in the
company
invested
(%)
Explanatio
n for the
difference
between
shareholdin
g
percentage
and voting
percentage
Impa
irme
nt
impairme
nt
provision
in current
period
cash bonus
in current
period
Automobile Technology Co. Ltd.
Changan Suzuki Automobile Co. Ltd. Cost 594949059.30 594949059.30 594949059.30 100.00% 100.00% -
Zhenjiang Demao Hairun Equity
Investment Fund Partnership (Limited
Partnership)
Cost 1129922044.91 1129922044.91 1129922044.91 100.00% 100.00% -
Chongqing Chehemei Technology Co.
Ltd.
Cost 10000000.00 10000000.00 10000000.00 100.00% 100.00% -
Total -- 15634263086.27 18017137600.72 1017328069.45 19034465670.17 － － － － － 0
4. Operating revenue and cost
(1) Operating revenue
In RMB Yuan
Items Current amount Prior-period amount
Main business income 25956607065.04 32840989835.15
Other business income 848501257.18 1368075880.87
Operating cost 24637906770.95 29726487573.72
(2) Main business (classified by industries)
In RMB Yuan
Industries
Current amount Prior-period amount
revenue cost revenue cost
Automobile manufacturing
industry
25956607065.04 24182358106.88 32840989835.15 29084851115.73
Total 25956607065.04 24182358106.88 32840989835.15 29084851115.73
(3) Main business (classified by products)
In RMB Yuan
Products
Current amount Prior-period amount
revenue cost revenue cost
Sales of goods 25895618136.43 24096513989.33 32768288077.90 28995127299.93
Outsourcing processing 60988928.61 85844117.55 72701757.25 89723815.80
Total 25956607065.04 24182358106.88 32840989835.15 29084851115.73
5. Investment income
(1) Details of investment income
In RMB Yuan
Items Current amount Prior-period amount
Long-term equity investment income measured by cost
method
628650000.00
Long-term equity investment income measured by equity
method
-78048193.41 1362011815.11
investment income from long -term equity investment
disposition
42715.98
others 4149371.08 4434355.36
Total -73898822.33 1995138886.45
(2) Long-term equity investment incomemeasured by cost accounting method
In RMB Yuan
Items Current amount Prior-period amount
Chongqing Changan Automobile Customer Service Co.
Ltd.
628650000.00
Total - 628650000.00
(3) Long-term equity investment income measured by equity accounting method
In RMB Yuan
Invested in company Current amount Prior-period amount
Changan Ford Automobile Co. Ltd -388312379.14 866427723.13
Changan Mazda Automobile Co. Ltd 431236189.88 635451737.12
Changan Suzuki Automobile Co. Ltd. -80032104.09
Changan Ford Mazda Engine Co. Ltd. 22279051.96 41312350.21
Jiangling Holding Co. Ltd -236679161.41 -83707141.74
Changan PSA Automobiles Co. Ltd. -37577002.31 -171729822.06
Chongqing Changan Kuayue Automobile Co. Ltd 39038877.69 17458524.85
Changan Auto Finance Co. Ltd. 121622360.91 137070317.23
Zhenjiang Demao Hairun Equity Investment Fund
Partnership (Limited Partnership)
-239769.54
Hunan Guoxin Semiconductor Technology Co. Ltd. -145569.13
Hainan Anxinxing Information Technology Co. Ltd. -775195.24
Nanjing Chelai Travel Technology Co. Ltd. -238955.00
Changan Weilai New Energy Automobile Technology Co.
Ltd.
-16493522.92
Nanjing Leading Equity Investment Partnership (Limited
Partnership)
-12002888.70
Total -78048193.41 1362011815.11
XVIII. Additional information
1. Non-recurring profit and loss statement of current period
In RMB Yuan
Items Amount Explanation
Profit and loss of non-current assets disposition 9392459.28
Government subsidies counted in current profit and loss (except the
government subsidies which are closely related with business events and
given certain amount according to national standards)
620733074.11
Net profit or loss of the subsidiary from the beginning of the business
combination to the merger date
In addition to the effective hedging business related to the normal
business of the company the gains and losses from changes in fair value
arising from the holding of trading financial assets derivative financial
assets trading financial liabilities derivative financial liabilities and
disposal of transactional financial assets derivative finance investment
income from trading financial assets trading financial liabilities
derivative financial liabilities and other debt investments
40337151.27
Other non-business incomings and outgoings except above-mentioned
items
6191613.24
Interest on deferred payment of funds received from non - financial
enterprises
18205918.42
Less: amount influenced by income tax 13119121.76
Amount influenced by minority shareholders’ interest (after tax) 10013259.23
Total 671727835.33
If the company identifies non-recurring profit and loss defined by Information Disclosure by Companies Offering Securities to the
Public No. 1--non-recurring profit and loss and non-recurring profit and loss defined by Information Disclosure by Companies
Offering Securities to the Public No. 1--non-recurring profit and loss as recurring profit and loss explain the reasons.
□ Applicable √ Not applicable
2. Return on equity and earnings per share
In RMB Yuan
Profit in report period
Weighted average return on
equity
Earnings per share
Basic EPS Basic EPS
Net profit belonging to the Company’s common
stockholders
-4.97% -0.47 Not applicable
Net profit belonging to the Company’s common
stockholders after deducting non-recurring profit and loss
-6.46% -0.61 Not applicable
3. Accounting data difference by domestic and foreign accouting standards
(1) Net profit and net asset differences from financial statements by global GAAC and prc GAAC
□ Applicable √ Not applicable
(2) Net profit and net asset differences from financial statements by GAAC abroad and PRC GAAP
□ Applicable √ Not applicable
(3) Description on accounting data differences by domestic and foreign accounting standards. If auditing institutions abroad
have adjusted the data differences identify the name of the auditing institution abroad.None
4. Others
□ Applicable √ Not applicable
Chapter 10 Documents for Future Reference
Catalogue of Reference Files
1、Semi-annual report with signature of legal representative;
2、Financial statements with the signatures and seals of legal representative person in charge of accounting and
person in accounting agency;
3、BOD resolutions and written confirmation documents signed by board members and senior executives;
4、Written auditing opinions in form of resolution by the Board of Supervisors;
5、All original copies of company documents and announcements disclosed in China Securities Journal
Securities Time and Hong Kong Commercial Daily in reporting period.The company will provide the the abovementioned reference files timely when required by China Securities
Regulatory Commission and Shenzhen Stock Exchange and required by shareholders according to law and
corporate regulations.
Chairman: Zhang Baolin
Submit Date Approved by BOD: August 31 2019
沪公网安备31011802005267号
