Chongqing Changan Automobile Company Limited 2022 Annual Report April 2023Chongqing Changan Automobile Company Limited 2022 Annual Report Chapter 1 Important Notice Contents and Definitions 1. The Board of Directors (or the “Board”) the Supervisory Board as well as the directors supervisors and senior managers of Chongqing Changan Automobile Co. Ltd. hereby guarantee the factuality accuracy and completeness of the contents of this Report and its summary and shall be jointly and severally liable for any misrepresentations misleading statements or material omissions therein. 2. Zhu Huarong the Company’s legal representative Zhang Deyong the Company’s Chief Financial Officer and Chen Jianfeng the person-in-charge of the accounting organ hereby guarantee that the financial statements carried in this Report are factual accurate and complete. 3. Except the following directors all the directors have attended the board meeting for reviewing this Report.Name of the directors absent Positions Reasons for the absence Name of the Trustees Zhang Bo Director Work reasons Xian Zhigang Liu Gang Director Work reasons Zhang Deyong Li Keqiang Independent Director Work reasons Ren Xiaochang 4. Any prospective description such as future business plans and development strategies in this Report shall not be considered as the Company’s commitment to investors. Investors and relevant persons shall be sufficiently mindful of risks and undertake the difference in plans predictions and commitment. 5. Chapter III “Management Discussion and Analysis” of this Report describes the possible risks and countermeasures of the Company and investors shall pay attention to the relevant content. 6. The Board has approved a final dividend plan as follows: Based on 9921799422 shares a cash dividend of RMB 2.36 (tax included) per 10 shares is to be distributed to all shareholders without transferring capital reserve to share capital.This Report have been prepared in both Chinese and English. Should there be any discrepancies or misunderstandings between the two versions the Chinese version shall prevail. 1Chongqing Changan Automobile Company Limited 2022 Annual Report CONTENTS Chapter 1 Important Notice Contents and Definition... 1 Chapter 2 Company Profile and Main Financial Index... 5 Chapter 3 Management Discussion and Analysis ........ 9 Chapter 4 Corporate Governance ..................... 37 Chapter 5 Environmental and Social Responsibility .. 57 Chapter 6 Significant Events ....................... 66 Chapter 7 Share Changes and Shareholder Informatio.. 71 Chapter 8 Preference Shares ........................ 76 Chapter 9 Bonds .................................... 77 Chapter 10 Auditor’s Report ........................ 80 2Chongqing Changan Automobile Company Limited 2022 Annual Report Documents Available for Reference I. Financial statements carrying the signatures and seals of the Company’s legal representative the Chief Financial Officer and the person-in-charge of the accounting organ.Ⅱ. The 2022 Auditor’s Report stamped by the accounting firm and signed and stamped by chartered accountants.Ⅲ. During the reporting period the original copies of all company documents and announcements publicly disclosed by the Company in China Securities Journal Securities Times Securities Daily Shanghai Securities News and Hong Kong Commercial Daily.IV. Annual Reports disclosed in other securities markets.Definitions Items Definitions Changan Auto Changan Refers to Chongqing Changan Automobile Co. Ltd.Automobile the Company China South Industries Group Corporation the Company’s actual CSG Refers to controller China Changan Automobile Group Co. Ltd. formerly known as China China Changan Refers to South Industries Automobile Co. Ltd. a subsidiary company of CSG Chongqing Changan Industry (Group) Co. Ltd. formerly known as Changan Industry Refers to Changan Automobile (Group) Co. Ltd. a subsidiary company of CSG Nanjing Changan Automobile Co. Ltd. a subsidiary company of the Nanjing Changan Refers to Company Hebei Changan Automobile Co. Ltd. a subsidiary company of the Hebei Changan Refers to Company Hefei Changan Automobile Co. Ltd. a subsidiary company of the Hefei Changan Refers to Company Changan Bus Refers to Baoding Changan Bus Co. Ltd. a subsidiary company of the Company Kaicheng Automotive Technology Co. Ltd. a subsidiary company of the Kaicheng Automobile Refers to Company Chongqing Changan Automobile International Sale Service Co. Ltd. a CIC Refers to 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 Jiangling Holding Refers to Jiangling Holding Co. Ltd. an associate of the Company Changan Finance Refers to Changan Automobile Financing Co. Ltd. an associate of the Company China South Industries Group Finance Co. Ltd. a subsidiary company of CSG Finance Refers to South Industries UPI Refers to United Prosperity Investment Co. Ltd. a subsidiary company of China 3Chongqing Changan Automobile Company Limited 2022 Annual Report Changan Chongqing Changan Technology Co. Ltd. a subsidiary company of the Changan Technology Refers to Company Chongqing Changan New Energy Vehicle Technology Co. Ltd. formerly an associate of the Company renamed as Deep Blue Automotive Changan New Energy Refers to Technology Co. Ltd. on April 6th 2023 currently a subsidiary company of the Company Avatr Refers to Avatr Technology (Chongqing) Co. Ltd. an associate of the Company 4Chongqing Changan Automobile Company Limited 2022 Annual Report Chapter 2 Company Profile and Main Financial Indexes I. Basic Information Stock abbreviation Changan Automobile Changan B Stock Code 000625 200625 Listed on Shenzhen Stock Exchange Company name in Chinese 重庆长安汽车股份有限公司 Chinese abbreviation 长安汽车 Company name in English Chongqing Changan Automobile Co. Ltd.Legal representative Zhu Huarong Registered address No. 260 East Jianxin Road Jiangbei District Chongqing Post code of the registered address 400023 No. 260 East Jianxin Road Jiangbei District Chongqing.Office address Building T2 No. 2 Financial City No. 61 Dongshengmen Road Jiangbei District Chongqing.Post code of the office address 400023 Website http://www.changan.com.cn E-mail address cazqc@changan.com.cn Ⅱ. Contact Information Secretary of the Board of Directors Securities affairs representative Name Zhang Deyong Li Jun Building T2 No. 2 Financial City No. 61 Contact address Dongshengmen Road Jiangbei District Chongqing TEL 023-67594008 FAX 023-67866055 E-mail address cazqc@changan.com.cn Ⅲ. Information Disclosure and Filing Site Stock exchange website where this Report is discl osed http://www.szse.cn Media and website where this Report is disclosed China Securities Journal Securities Times Securities Daily Shanghai Securities News Hong Kong Commercial Daily and www.cninfo.com.cn Place where this Report is lodged Board Office of the Company IV. Changes of Registration Information Organization Code 9150000020286320X6 Changes in the main business since the Company’s listing Not applicable Changes of controlling shareholder since 1. In December 2005 according to the restructuring program on automobile business the incorporation (if any) Company’s actual controller CSG transferred all state-owned shares of Changan Automobile (Group) Company Limited (“Changan Group”) as part of funding for China 5Chongqing Changan Automobile Company Limited 2022 Annual Report South Industries Automobile Co. Ltd. In March 2006 all shares held by Changan Group have been transferred to China South Industries Automobile Co. Ltd. China South Industries Automobile Co. Ltd. became the majority shareholder of the Company and Changan Group holds zero share since then. 2. In July 2009 with the approval of State Administration for Industry and Commerce “China South Industries Automobile Co. Ltd.” changed its name to “China ChanganAutomobile Group Co. Ltd.”. No change occurred in its property ownership and control of the Company. 3. In February 2019 “China Changan Automobile Group LLC” changed its name to “China Changan Automobile Group Co. Ltd.” with the approval of Beijing Administration for Industry and Commerce. The company changed from a joint stock company to a limited liability company.V. Other Relevant Information The audit firm employed by the Company Name Ernst & Young Hua Ming LLP (Special General Partnership) Office address 17th Floor Ernst & Young Tower Oriental Plaza No. 1 East Chang An Avenue Dong Cheng District Beijing China Accountants writing signatures Qiao Chun Yuan Yong The independent sponsor employed by the Company to exercise constant supervision over the Company in the reporting period √ Applicable □Not applicable Name Office address Sponsor representative Supervision period CITIC Securities 21st Floor CITIC Securities Building No. 48 He Yang Chen October 26 2020 - Co. Ltd. Liangmaqiao Road Chaoyang District Beijing Shumian December 31 2021 Note: CITIC Securities Co. Ltd. is the recommendation institution for the continuous supervision of the company's non-public offering of shares in 2020.The independent financial advisor employed by the Company to exercise constant supervision over the Company in the reporting period □ Applicable √ Not applicable VI. Key Accounting Data and Financial Indexes Does the Company need to retrospectively adjust or restate the accounting data of previous years? □Yes √ No 2022 2021 YoY change (%) 2020 Operating revenue (RMB) 121252864085.40 105141877237.05 15.32% 84565544146.58 Net profit attributable to shareholders of the 7798451093.72 3552463320.03 119.52% 3324251164.16 Company (RMB) Net profit after deduction of non-recurring gains or losses attributable to 4458919314.80 1652771338.77 169.78% -3249984527.77 shareholders of the Company(RMB) Net cash flow from operating activities (RMB) 5666346858.52 22971723210.84 -75.33% 10675953479.24 Basic earnings per share (RMB/share) 0.80 0.36 122.22% 0.34 Diluted earnings per share (RMB/share) 0.78 0.36 116.67% Not applicable Weighted average ROE (%)13.07%6.53%6.54%7.13% 6Chongqing Changan Automobile Company Limited 2022 Annual Report 31 December 2022 31 December 2021 YoY change (%) 31 December 2020 Total assets (RMB) 146048555951.92 135404623479.63 7.86% 118265186394.86 Net assets attributable to shareholders of the 62858105705.70 55732932103.72 12.78% 53410193236.09 Company (RMB) The lower of the Company’s net profit before and after deduction of non-recurring gains and losses in the most recent three fiscal years is negative and the audit’s report of last year shows that the Company’s ability to continue operations is uncertain.□Yes √ No The lower of the net profit before and after non-recurring gains and losses is negative.□Yes √ No VII. The Differences between Chinese Accounting Standards and International Financial Reporting Standards 1. Differences in net profit and net asset attributable to shareholders in financial report disclosed in accordance with International Financial Reporting Standards and Chinese Accounting Standards □ Applicable √ Not applicable No difference during the reporting period. 2. Differences of net profit and net assets disclosed in financial reports prepared under Overseas Financial Reporting Standards and Chinese Accounting Standards □ Applicable √ Not applicable No difference during the reporting period. 3. Reasons for differences in accounting data under Chinese Accounting Standards and International Financial Reporting Standards □ Applicable √ Not applicable VIII. Key Financial Indexes of 2022 by Quarter Unit: RMB First Quarter Second Quarter Third Quarter Forth Quarter Operating revenues 34575856873.59 21997711520.12 28778056089.43 35901239602.26 Net profit attributable to shareholders of the Company 4536355136.07 1321270999.71 1042292116.23 898532841.71 Net profit attributable to shareholders of the Company after deducting non-recurring 2269972838.78 830140980.56 739364812.69 619440682.77 gains and losses Net cash flow from operating activities 769267734.42 5082968685.78 -2069436274.57 1883546712.89 Whether there are significant differences between the above-mentioned financial indexes or its total number and the relevant financial indexes disclosed in the Company’s quarterly report and semi-annual report □ Yes √ No IX. Items and Amounts of Non-Recurring Gains and Losses √ Applicable □Not applicable Unit: RMB Items 2022 2021 2020 Explanation Gains or losses on disposal of non-current assets 74862481.00 745601530.26 29465046.07 7Chongqing Changan Automobile Company Limited 2022 Annual Report (inclusive of impairment allowance write-offs) Government subsidies charged to current gains or losses (exclusive of government subsidies given in the Company’s ordinary course of 1134358181.32 1335952105.80 797901407.24 business at fixed quotas or amounts as per the government’s uniform standards) Gains or losses on fair-value changes on held for trading financial assets (exclusive of the 3570229.29 42078804.00 2035390665.86 effective portion of hedges that arise in the Company’s ordinary course of business) Gains and losses on entrusted loans 6959316.00 13768160.42 Losses from business combination not under -6937641.07 common control Gains from disposal of long-term equity 1398196002.13 investments The subsidiary Avatr has introduced investors for capital increase and based on the evaluation results on March 11 2022 as the benchmark date the income on the statement has Gains from the remeasurement of the remaining 2128313646.36 2246681836.54 been confirmed. For equity at fair value after the loss of control details please refer to the "Progress Announcement on Controlling Subsidiaries to Increase Capital and Expand Shares through Public Listing" disclosed on the same day on CNINFO Non-operating income and expense other than 77519377.00 90085373.52 -27519486.75 the above Deferred payment interest on funds charged to 40505154.81 11853260.69 17795918.37 non-financial corporations Reversal of impairment provision for accounts 2847641.57 receivable subject to separate impairment testing Minus: influenced amount of income tax 94817746.44 196630848.39 -91514483.25 Non-controlling interests effects (after tax) 27627185.99 136207560.62 22020700.13 Total 3339531778.92 1899691981.26 6574235691.93 Particulars about other gains and losses that meet the definition of non-recurring gain/loss □ Applicable √ Not applicable No such cases for the reporting period.Explanation of why the Company reclassifies non-recurrent gain/loss as a recurrent gain/loss item listed in the Explanatory Announcement No. 1 on Information Disclosure for Companies Offering Their Securities to the Public—Extraordinary Gain/Loss Items □ Applicable √ Not applicable No such cases for the reporting period. 8Chongqing Changan Automobile Company Limited 2022 Annual Report Chapter 3 Management Discussion and Analysis I．Industry Overview in 2022 1. The industry analysis 2022 is a year which is full of challenges and opportunities for China’s auto industry. Despite the impact of macroeconomic downturn the automobile industry withstood the pressure and numerous tests. The annual auto sales rose by 2.1 percent. Especially the new energy vehicles maintained a rapid growth momentum and their sales hit a new high. At the same time car exports increased significantly and the annual export exceeded 3 million units. Amid transformation and multiple challenges China’s auto industry is entering a new stage of development. The details are as follows.In 2022 the cumulative production and sales of the auto industry reached 27.021 million units and 26.864 million units up by 3.4% and 2.1% year-on-year respectively. Since 2017 the sales volume has achieved two consecutive increases for the first time and China’s scale of production and sales has been the first in the world for 14 consecutive years. The passenger vehicle market still showed enough resilience in recent years. The cumulative production and sales of the passenger vehicle reached 23.836 million units and 23.563 million units up by 11.2% and 9.5% year-on-year respectively both of which significantly outperformed the industry. Chinese brands mainly contributed to the growth in the passenger car market and market share climbed to a record high mainly due to the dominant position of the new energy vehicles. The commercial vehicle market was affected by factors such as the surging demand brought by the previous emission and overloading restriction policies. The production and sales of commercial vehicles declined by more than 30% year on year which was a decline for two consecutive years and 2022 sales volume compared to 2009 fell to a new low in 14 years.New energy vehicles continue to show explosive growth. Their sales hit a new high and was the largest growth point of the automobile market the production and sales volume of new energy vehicles reached 7.058 million units and 6.887 million units respectively with year-on-year growth exceeding 90%. New energy vehicles become a bright color in the current automobile market.In the new energy passenger car market the sales volume of pure electric models accounted for more than 70% occupying an absolute share advantage. Plug-in hybrid models have been growing rapidly in recent two years maintaining a high growth trend. The competition in the new energy industry has quietly changed. Chinese brands rank the first place in the annual sales of pure electric passenger cars and the growth rate of the new power car enterprises slowed down. Also the internal pattern changed. In the transformation towards new energy vehicles the traditional leading OEMs have faced the competition by launching new energy brands and they overtook the new players.In 2022 automobile export of China exceeded 3 million units and automobile export has become a new growth point of the industry after new energy vehicles. In recent years under the correct guidance of national policies Chinese automobile enterprises have continued to strengthen technological innovation and the competitiveness of independent brands has been continuously improved.In particular independent brands have made considerable progress in the fields of new energy and intelligence in recent years which has further enhanced the image status of Chinese automobiles in overseas markets and promoted the increase of export sales. In addition with the gradual expansion of automobile export scale the “going global” mode of Chinese OEMs is also constantly enriched from the single export gradually expanded to overseas investment and construction of factories.China's Automobile Sales Volume and Growth Rate from 2001 to 2022 Sales Volume Growth Rate Unit: 10000 units 50.0%3500 46.1% 40.0%2803288828083000 37.0%35.2%262726862577 32.4%24602531 30.0%23492500 2198 25.1% 20.0%21.8%18061851 19312000 14.1%15.5%13.5%13.9%13.7% 10.0%13641500 6.7%6.9% 4.3%4.7% 9382.5%3.0%3.8%8792.1%0.0%1000 722-2.8%-1.9% 507576 -10.0%439-8.2%325500237 -20.0%0 2001200220032004200520062007200820092010201120122013201420152016201720182019202020212022 Source: China Automobile Industry Newsletter of Production & Sales and other industry information released from the China 9Chongqing Changan Automobile Company Limited 2022 Annual Report Association of Automobile Manufacturers. 2. Changan Auto’s performance In 2022 thoroughly studied and implemented the spirit of Xi Jinping's important instructions Changan effectively responded to the grim and complex international situation and the huge risks and challenges that entailed it and made every effort to overcomechallenges With the key of “strengthening the foundation pursuing progress through innovation restructuring the system and takingthe lead“ the company strives to promote the high-quality development of enterprises proactively constructs a new developmentpattern steadily pushes forward the Third Business Venture — Innovation & Entrepreneurship Program and constantly breaks the waves on the channel of promoting the transformation and development of enterprises with a vigorous spirit.In 2022 Changan overcame the repeated influence of multiple uncertain factors and controlled the operation quality. The annual sales volume was 2.346 million units with a year-on-year growth of 2.0%. The market share remained unchanged. The sales volume of Changan Chinese brand cars was 1.875 million with a year-on-year growth of 6.8% ranking the second in the industry. Changan new energy vehicle sales exceeded 270000 units with a year-on-year growth rate much better than the new energy vehicle industry.Changan took resolute and daring actions to respond to the 20th CPC National Congress! 3. Industrial policies (1) Announcement on the reduction of the purchasing tax on part of passenger vehiclesOn May 31 2022 the Ministry of Finance the State Administration of Taxation issued the “Announcement on the reduction ofthe purchasing tax on part of passenger vehicles”. The government will cut the tax for cars priced at no more than 300000 yuan and with 2.0-liter. The tax cut will be applicable for purchases from June 1 2022 through the end of the year.From June to November 10 2022 the policy reduced vehicle purchase tax for eligible passenger vehicles by a total of RMB 39.75 billion. Data from the unified invoice for sales of motor vehicles showed that from June to October 2022 approximately 6.523 million passenger vehicles of 2.0-liter displacement and below were sold representing a year-on-year growth of 20.6% compared with the January-May period before the implementation of the policy which had an obvious policy effect and effectively promoted automobile consumption effectively driving the sales of the Company’s related products to climb. (2) Announcement on the continuation of the NEV purchase tax exemption policy On September 18 2022 the Ministry of Finance the State Administration of Taxation the Ministry of Industry and Information Technology in order to support the development of the new energy automobile industry and promote automobile consumption jointly issued the Announcement on The Continuation of The New Energy Vehicle Purchase Tax Exemption Policy. The purchase date of new energy vehicles in the period of January 1 2023 to December 31 2023 vehicle purchase tax can be exempted. New energy vehicles exempt from vehicle purchase tax shall be managed through the Catalogue of New energy Vehicle Models exempt from Vehicle Purchase Tax issued by the Ministry of Industry and Information Technology and the State Administration of Taxation.Extending the vehicle purchase tax exemption policy for new-energy vehicles can increase additional 100 billion yuan expected to be exempted. According to the data of China Association of Automobile Manufacturers in 2022 the production and sales of new energy vehicles completed 7.058 million and 6.887 million respectively with year-on-year growth of 96.9% and 93.4%. The market share reached 25.6% 12.1 percentage points higher than the previous year. The policy will further promote the consumption of new energy vehicles conducive to the company’s new energy product market sales. 4. Major laws and regulations (1) Market access With the development of Chinese automobile industry the national management system of automobile product certification is also in continuous improvement. Under the background of a new round of scientific and technological revolution and breakthrough the development of intelligent connected vehicles has risen to a national strategic height. At the same time the automobile authorities are constantly studying and promoting the access system of intelligent connected vehicles. In November 2022 the Ministry of Industry and Information Technology and the Ministry of Public Security publicly solicited the Notice on Pilot Work of Access and road use of Intelligent Connected Vehicles (Draft for Comments) proposing to guide enterprises to strengthen capacity building through pilot work.Changan is actively participating in the formulation and pilot research of the access system of intelligent connected vehicles by the Ministry of Industry and Information Technology and other automobile authorities. In September 2022 Changan has established an intelligent connected vehicle access promotion team to push enterprises to achieve access conditions. (2) Standards Changan’s various models are in strict accordance with the national regulations and standards for development and manufacturing. 10Chongqing Changan Automobile Company Limited 2022 Annual Report Changan’s products are in line with the regulations and standards. As for the new standards that have been implemented Changan has completed the product upgrade and switch according to the time requirements among which the standards for 2022 are as follow. (A) GB 17675-2021 “Basic Requirements for Automotive Steering System” was released in February 2021 and for new type approved vehicles it will be implemented on January 1 2022. For models with type approval it will be implemented on January 1 2023. This standard defines the term definition technical requirements and test methods of automobile steering system and adds that the electrical control of steering system should meet the requirements of electromagnetic compatibility functional safety failure alarm and so on. (B) GB 39732-2020 "Automobile Event Data Recording System" was released in December 2020. This standard stipulates that the automobile event data recording system records the motion state of the vehicle for the purpose of cause analysis and liability determination after an accident. As of January 1 2022 the newly applied type approval vehicles meet the requirements of this standard except for B-class elements and Article 4.4. New type approval applications from 1 January 2024 should meet all requirements. (C) GB/T 31498-2021 “Post-Crash Safety Requirements for Electric Vehicles” was released in August 2021 and implemented as of March 1 2022. This standard sets out special safety requirements for electric vehicles after frontal side and rear crashes. (D) GB 19578-2021 “The Fuel Consumption Limits for Passenger Vehicles” were issued in February 2021 and applied to type approved models from 1 January 2023. The standard mainly specifies the fuel consumption limit requirements based on the reconditioning mass of passenger vehicles under WLTC cycle conditions. (E) GB 9656-2021 “Technical Specification for Safety of Glass for Motor Vehicles” was issued in April 2021. From January 1 2023 the glass of new type approved vehicles shall meet the requirements of safety of visual field safety of strength safety of destruction and so on. (F) GB 16897-2022 “Brake hose structure performance requirements and test methods” was released in August 2022. This standard mainly added the hydraulic brake hose fast tensile strength pneumatic brake hose flexure fatigue requirements. From January 1 2023 the new application type approval of the vehicle will be implemente. It will be implemented on July 1 2023 for models with type approval.(G) GB 15084-2022 “Performance and Installation Requirements for Indirect Vision Devices for Motor Vehicles” was released in December 2022. The standard mainly adds the requirements for the use of electronic rearview mirrors rimless internal view mirrors and other related requirements. The standard will be implemented on July 1 2023 for the newly applied type approval models.II. Analysis of Core Businesses in 2022 As an automobile manufacturer Changan Automobile’s businesses cover the R&D manufacturing and sales of vehicles (including passenger vehicles and commercial vehicles) as well as the R&D and production of engines. At the same time we proactively develop new businesses such as mobility car services new marketing and sales and battery swapping and steps up efforts in exploring finance used cars and other fields to build a comprehensive industrial ecology and become an intelligent and low-carbon mobility technology company.Changan always adheres to the mission of “Leading Auto Culture for a Better Life” to the concept of "energy saving environmental protection scientific and technological intelligence". At the same time Changan vigorously develops new energy and intelligent vehicles is committed to leading automobile civilization with scientific and technological innovation and strives to provide customers with high-quality products and services. The company now owns brands including Changan Automobile Oshan Automobile Kaicheng Automobile Deepal Avatr among which Changan Deepal and Avatr are the new energy brands released by Changan Automobile in recent years. Changan Deepal is positioned as a high-tech digital all-electric brand and Avatr is positioned as an emotional intelligent electric vehicle brand. In addition Changan also produces and sells joint-venture models through Sino-foreign joint ventures Changan Ford and Changan Mazda.Changan has launched a series of iconic models including CS series EADO series UNI series Oshan series and Shenqi series.At the same time Changan has created Deepal SL03 Avatr 11 Lumin Benben E-star and other new energy models. Joint venture has a new generation of Mondeo Explorer Aviator Aviator Axela CX-5 CX-30 and other well-received products. Many models of the company are welcomed by consumers.Changan adopts the business model of “equal emphasis on wholly-owned and joint venture brands” and carries out entity operation of its own auto brand business such as Changan Automobile Changan Deepal Avatr Oshan Automobile Kaicheng Automobile etc. and firmly builds its own classic brand. We will conduct investment control over joint ventures such as Changan Ford and Changan Mazda and continue to deepen mutual trust and cooperation with partners. 1. The Company’s business development in 2022 (1) Effectively respond to multiple difficult challenges and the growth rate of the main board block is faster than that of the industry.Since 2022 the company has risen to the challenge taken the initiative adhered to the "rush and pull" fought for resources and technology substitution through multiple channels and made every effort to "ensure supply production and delivery". The company's sales scale continued to improve with sales of 2.346 million units in 2022 a new high in the past five years and sales increased by 2.0% year-on-year achieving a three-year increase in the company's overall sales year-on-year! Changan’s sales of Chinese brand vehicles reached 1.875 million units a new high increased by 6.8% year-on-year. The sales scale of self-owned new energy brand vehicles has jumped significantly with annual sales exceeding 270000 units a year-on-year growth rate significantly better than that 11Chongqing Changan Automobile Company Limited 2022 Annual Report of the industry. Overseas export sales reached a new breakthrough with a total export volume of 170000 self-owned brands setting a new record for export sales.The sales volume of key products increased steadily which strongly supported the company's sales base. According to terminal retail data the CS75 series has retailed nearly 220000 units throughout the year and the sales of the second-generation CS75 PLUS continue to rank in the forefront of Chinese brand compact SUVs. The annual sales volume of the EADO series and CS55 series reached 150000 units and 130000 units respectively of which the sales volume of the EADO PLUS ranked third in the Chinese brand compact car; UNI series sales exceeded 180000 units of which UNI-K sales exceeded 5000 units in a single month; Oshan X5 achieved annual sales of nearly 90000 units achieving monthly sales of 10000 units. (2) The strategic path has been continuously refined and the pace of transformation has become more stable. With the Changan’s "14th Five-Year Plan" as the traction accelerate the pace of strategic transformation implement version 5.0 of the innovation and entrepreneurship plan and version 6.0 of the iterative innovation and entrepreneurship plan continuously strengthen the management of the whole process and all elements of the strategy promote the basic achievement of planning goals and make new progress in the "Beidou Tianshu" and "Shangri-La" plans.Accelerate the promotion of intelligent strategy and continue to strengthen brand recognition. Released the intelligent brand "Zhuge Intelligence" opened a new track for new automobiles and unveiled the first prototype car CD701 equipped with the new digital intelligent architecture SDA making every effort to seize the commanding heights of the intelligent industry. Accelerate the implementation of major projects create a new batch of scientific and technological innovation subjects realize the landing of long- term intelligence and other projects and complete the establishment of Changan Technology Company. Focus on the field of new energy release a new digital pure electric brand - Deepal start to build OX sequence and accelerate the transformation of the whole brand sequence to new energy; Fully promote the construction of new energy production capacity start major projects such as Yubei factory replacement and green intelligent upgrading construction and promote the transformation of traditional manufacturing to green intelligent manufacturing.Focus on the globalization strategy and steadily expand overseas markets. Sales in overseas markets have achieved a breakthrough against the trend exporting nearly 250000 vehicles throughout the year ranking fourth in the domestic automotive industry in terms of total exports maintaining rapid growth for seven consecutive years; The overseas market layout is increasingly perfect and the sales volume in 10 countries including Saudi Arabia ranks in the forefront of Chinese brands.New progress has been made in the construction of the industrial ecosystem and comprehensive and in-depth cooperation with excellent partners in various fields in the fields of new energy and intelligence has been created to create "new automobiles" and win- win "new ecology". The first batch production cars of the Avatr 11 and 011 the emotional intelligent electric coupe SUVs jointly built with Huawei and CATL have officially rolled off the production line at the end of 2022; Establish joint innovation centers with Tsingshan Industry and South China Optoelectronics in the fields of new energy and intelligence and strive to tackle key technologies and jointly cope with future challenges; It has signed strategic cooperation agreements with many domestic and foreign leading enterprises such as NXP and Desay SV as well as universities and the circle of cooperation has expanded from traditional enterprises to technology enterprises. (3) Adhere to the two-wheel drive of reform and innovation and the key capabilities are continuously enhanced.We have continued to cultivate the field of new energy and intelligence and have mastered more than 600 intelligent low-carbon core technologies. Accelerate the breakthrough of the core technology of "three electricity" and make great progress in the core field of new energy and power technology. Master the battery CTP integration technology and realize mass production and installation of all-in-one super-collector electric drive and seven-in-one "smart core"; Released three new energy power technologies for the green future: "Changan Hydrogen Fuel Cell System Changan Smart Electric iDD and Changan Force Electric". Focusing on the intelligent field of "core device graph core cloud network sky" the forward-looking technology research has achieved stage results achieved a breakthrough in the bottleneck of the "integrated driving" architecture of the new platform of autonomous driving solution 2.0 (ADS2.0) released the first APA6.0 remote intelligent parking industry and released 20 key technical achievements of the SDA-S platform such as experience-driven computer (EDC) hardware pluggable and intelligent control digital base service-oriented. Build CHN EPA1 MPA2 and other platforms the development of intelligent platform architecture is carried out in an orderly manner the system construction is constantly improved and the image of “Tech Changan” is deeply rooted in the hearts of the people.The performance of new products on the market is remarkable and the sales volume has increased significantly forming a new momentum for growth. Successfully launched 5 electric electrification products including Lumin Deepal SL03 Avatr 11 UNI-K Smart Electric iDD Oshan Z6 Smart Electric iDD and launched new fuel vehicle products such as UNI-V second-generation CS75PLUS and Changan Landtop. According to terminal retail data UNI-V has nearly 100000 units and its monthly sales once ranked second in the Chinese brand compact car market; Lumin delivered more than 10000 vehicles in a single month with a retail of more than 60000 units and its monthly sales once ranked second in the Chinese brand new energy mini car market; The Deepal SL03 quickly seized the mainstream passenger car market with a retail of 25000 units ranking among the top five in the new energy mid- size car market.Marketing innovation has been further advanced and operational efficiency has been significantly improved. Taking Lumin and Deepal SL03 as pilots build a "three-center" channel system and basically open up a new marketing operation model of "scene decoupling digital connection and diversified combination". By reconstructing traffic scenarios services and data structures the proportion of self-operated + direct-operated leads is increased the cost of individual leads is further reduced the conversion rate of leads to orders is improved and a traffic operation system with "better cost and higher efficiency" is initially constructed. 12Chongqing Changan Automobile Company Limited 2022 Annual Report The reform of the organizational system has been accelerated and the ability to guarantee strategic transformation has been continuously consolidated. Focusing on the strategy of "New Automobile New Ecology" the New Automobile Development Department was established to build organizational capabilities to support the realization of new intelligent and connected automobile products. Optimize the electrification organization of the product development department to drive the electrification transformation.Promote the tenure system and contractual management further enhance the vitality of cadres and stimulate the motivation of officers.Accelerate the cultivation of innovation capabilities introduce more than 1000 professionals in the fields of new energy and intelligence and help enterprises transform and develop. 2. Blockbuster products to be launched in 2022 Avatr 11 the first product of the Avatr brand is based on the CHN pure electric platform jointly built by Changan Huawei and CATL positioning high-end emotional intelligent electric SEV (mid-size SUV) with international high-end original design emotional interactive intelligent cockpit three lidar high-end intelligent driving 750V high-voltage fast charging 3.98s zero hundred acceleration as product highlights for the people who are pleasant love themselves and love their families to create intelligent electric SEV.Avatr 11 Deepal SL03 based on the EPA1 all-electric digital platform is compatible with three energy replenishment methods: pure electric range extender and hydrogen fuel cells.Equipped with 19-inch sports wheels frameless doors LOW-E panoramic canopy power liftgate 14.6-inch sunflower screen AR-HUD and other technological equipment. Using Force electric technology the maximum power can reach 190kW and the fastest acceleration is 5.9s per 100 km/h. It has an integrated adaptive IACC and all models are equipped with intelligent driving assistance functions such as lane change assist intelligent panoramic image and AEB automatic emergency braking as standard. The smart cockpit is equipped with the industry-leading Qualcomm 8155 chip which supports Deepal SL03 Bluetooth/NFC senseless cabin entry 3D holographic face login and other functions reconstructing the travel imagination with digital technology.UNI-V the first sedan in the UNI series brings the elegance and dynamism of a five-door hatchback coupe to the A+ class.The new exclusive coupe chassis has greatly strengthened the structure and reconstructs the suspension hard points based on genetic algorithms to upgrade the driving texture and expand the performance matching space. The exclusively tuned Blue Core power brings users a surging and delicate power experience. The high-rigidity and lightweight "ark cage" body structure improves safety standards in an all-round way.UNI-V 13Chongqing Changan Automobile Company Limited 2022 Annual Report UNI-K iDD is the first PHEV product under the high-end series UNI of Changan Passenger Vehicle and the first product in Changan equipped with the iDD intelligent Dual Drive system. UNI-K iDD continues the design concept of new technology intelligent aesthetics to present futuristic quality aesthetics; Based on the global high-efficiency electrical platform it realizes the excellent economical safe and dynamicperformance of “full speed domain full field domain fulltemperature domain and full time domain”. The future technology intelligent cockpit will make the car no longer just a simple travel tool but also an extension of human nature and the externalization of emotions and a smart partner with wisdom intelligence as well as emotional judgment and aesthetic UNI-K iDD experience.The second-generation CS75PLUS is upgraded from the four dimensions of power design intelligence and safety and brings users a leapfrog driving experience with six standard features. Whaletail wave grille and through-the-top headlights create a futuristic design; Dual 12.3-inch large screens and dual- color-block yacht-style electronic gear shift handles create an interstellar intelligent cockpit with a sense of technology; Blue Core's new generation engine + Aisin 8AT powerful and smooth gear changes bringing a better driving experience; 540° high- definition panoramic image bringing a travel experience full of 2nd-Generation CS75 PLUS science and technology. The 2022 EADO PLUS equipped with Blue Core's new generation NE1.4T high-efficiency power combination achieves the perfect balance of high power and low fuel consumption; handsome and sporty shape dynamic light and shadow progressive front grille minimalist skyline neon through-through LED taillights the whole vehicle posture is coordinated and rhythmic; wrap-around cockpit with dual 10.25-inch joint screens to show intelligent technology exquisite yacht-style electronic gear lever wireless charging of mobile phones The all-new lncall3.0S intelligent interaction 2022 EADO PLUS system and intelligent driving assistance system make the whole vehicle shape and quality more comprehensively evolved.The second-generation CS55PLUS Storm Gray Limited Edition creates a limited edition of Storm Ash car paint and cool orange trim with unique design aesthetics such as light and shadow progressive grille and star ring light source; The technologically aesthetic cockpit and intelligent power tailgate combine technology and practicality allowing aesthetics and functionality to complement each other. AI voice interaction intelligent sound source positioning whole vehicle voice control and tacit partnering; Intelligent remote control remote sharing of cars and call of internal and external cameras to keep abreast of vehicle conditions. Equipped with Blue Core's new generation NE1.5T high-efficiency power combination the maximum power is 138Kw surging power feeling; 4% reduction 2nd-Generation CS55 PLUS in fuel consumption per 100 km. 14Chongqing Changan Automobile Company Limited 2022 Annual Report Lamore PLUS a new generation of intelligent wide family car. Parametric gradient grille skyline LED light group surround smart light luxury cockpit elegant new Chinese light luxury design super comfortable; 2770mm ultra-long wheelbase full series of reinforced four-wheel independent suspension integrated zero-pressure seat;; Blue Core's new generation NE1.5T high-pressure direct injection engine is matched with Blue Touch's new generation 7-speed wet dual- clutch transmission; High-strength energy-absorbing body Lamore PLUS high-quality manufacturing technology high-standard verification system multiple protection travel with confidence.The 2022 CS35 PLUS continuing the 2021 Blue Core Edition. The dot matrix grille and front and rear echoing design run through the lamp and add whale tail styling elements to show strength in calmness; All models are equipped with Andean gray bodies and twin exhaust pipes. Asymmetrical interior design dual-screen connectivity integrated design. At the same time the horizontal layout is strengthened and the screen and IP decorative parts are pulled through the design left and right and the horizontal through air vents are added to make the internal space more reasonable and wide. 1.4T+7-speed wet dual-clutch of which Blue Core Power NE 1.4T direct injection 2022 CS35 PLUS engine has a maximum power of 118kW and a peak torque of 260Nm. The 2023 CS85 COUPE features a dome streamer-style back design star diamond headlights two-tone wheels and black carbon fiber mirrors highlighting its sporty charm. It adopts a classic combination of red and black. With a wrap- around starry cockpit panoramic starry sky skylight and microfiber leather seats it creates a new level of comfortable driving. With Blue Core's new generation NE1.5T high-pressure direct injection engine + 7DCT power combination Bosch electronic stable braking system all series of electronic gear shifting idle start-stop technology. Tencent TAI automotive intelligent system IACC integrated adaptive cruise system APA4.0 valet parking system 540° high-definition panoramic image system PAB warning auxiliary braking system. 2023 CS85 COUPE Oshan Z6 positioned as a new aesthetic smart flagship SUV as an Oshan brand leapfrog strategic model adopts prismatic design aesthetics capable lines outline dynamic body posture full-scene intelligent exterior voice function equipped with OnStyle 5.1 intelligent happy cockpit matching Blue Core's new generation NE1.5T + Blue Core 7-speed wet dual- clutch transmission high-efficiency powertrain create four major high-energy product strengths: high-energy styling high- energy intelligence high-energy power and high-energy quality Oshan Z6 15Chongqing Changan Automobile Company Limited 2022 Annual Report Oshan Z6 iDD perfectly integrates Blue Core 1.5T hybrid turbocharged engine 28.4kWh ultra-large capacity battery two- in-one high-efficiency motor and 6-speed transmission system with the blessing of AI intelligent control system and intelligent safety system of temperature balance bringing high performance and low energy consumption to the product. The product has the two advantages of smart electricity economy and smart electric safety 150KM ultra-long pure electric battery life 1200KM ultra-long comprehensive battery life IP68 industry's highest level of battery protection 6 levels of dustproof 8 levels of waterproof standard DC fast charging AC fast charging dual charging ports achieving a win-win situation of power and OshanZ6 iDD efficiency.Oshan X5 PLUS continuing the sense of sport of the light shaping design language adopts a 30-inch triple screen design three screens are distributed in the center of the driver's field of vision which is convenient for the driver to view and operate with a new electronic gear lever integrated sports seats etc… and Blue Core's new generation NE1.5T engine matches Blue Core’s 7-speed wet dual-clutch transmission and is equipped with OnStyle 5.1 intelligent and happy cockpit sports wisdom is excellent and create a new sports smart SUV.Oshan X5 PLUS Oshan X7 PLUS 7-seater version based on the excellent quality of Oshan X7 PLUS once again changes the cabin space focuses on multi-person travel scenarios and creates the "100000-level home enjoyment boutique 7-seater SUV preferred" label with scenario-based marketing. Changeable large space SUV 7-seat + 280L trunk space or5-seat + 780L trunk space free switching 2786mm class-leading wheelbase second-row seat backrest adjustable from 15° to 35° three-row seat cushion height 270mm seat backrest angle of 26° more practical. Meet the full-scenario car experience of users' families traveling with multiple people.Oshan X7 PLUS 7-seater version Changan Landtop pickup version of Blue Core power ZF 8-speed hand self integrated transmission BorgWarner all- wheel-drive system; Highly recognizable grille LED high- brightness headlight cluster through-type LED front lights two- tone wheels; Smart dual screen wide luxury seating space rich storage space; Enjoy first-class seats intelligent health air conditioning control system wrap-around 4 airbags multi- function steering wheel yacht-class grip gear shifting keyless entry and one-button start; Changan’s latest generation of vehicle system pickup version 540° high-definition panoramic image master chassis ESC body stability system lane departure warning cruise control system three-mode electronic power Changan Landtop steering. 16Chongqing Changan Automobile Company Limited 2022 Annual Report 3. Key models planned for 2023 In 2023 the company will launch a number of new and modified products including more than 10 new energy products accelerating the pace of new energy transformation. (1) Renew fuel vehicle products enhance competitiveness and consolidate market position. In 2023 Lamore the third- generation CS55PLUS and the third-generation CS75PLUS a total of 3 new products and a total of 6 modified products such as UNI- K UNI-T UNI-V will be launched one after another which will further enhance product competitiveness and consolidate the market position of fuel vehicles through interior and exterior decoration and configuration upgrades. Lamore is positioned as a compact family car born in the Changan Ark architecture with high-end simple appearance design wrap-around technology cockpit and a new generation of Blue Core power as product highlights to meet the needs of family users in pursuit of economical comfortable and safe travel. (2) Accelerate the electrification transformation and create the "Changan Smart Electric iDD Intelligent Electric Hybrid" cognition. In the first half of 2023 the new products UNI-V Smart Electric iDD the third-generation CS75PLUS Smart Electric iDD and the facelifted products UNI-K Smart Electric iDD and Oshan Z6 Smart Electric iDD will be launched soon; In the second half of the year a number of new Smart Electric iDD products such as the new compact sedan and the new compact SUV were launched one after another using the new Smart Electric iDD technology platform to meet the needs of strong power and low energy consumption improve the driving experience of users and further focus on building the "Changan Smart Electric iDD Intelligent Electric Hybrid" cognition to promote the realization of electrification transformation. (3) Improve the intelligent pure electric genealogy and establish a new energy market position. In 2023 C236 Deepal S7 and Avatr E12 products will be launched one after another and the lineage of smart pure electric products will be further improved helping to form a new energy market position and brand user recognition. C236 is positioned as a high-end comfortable mid-size sedan with smooth and forward-looking styling design high-tech cockpit and comfortable driving experience as product highlights to meet the needs of a new generation of young users. Positioning the Deepal S7 as a pure electric smart SUV on the basis of the EPA1 platform Force Range Extension and Super Three Electric it meets the core requirements of users for new energy intelligent SUVs through a new intelligent experience and creates a benchmark for 200000 pure electric smart SUVs. Avatr E12 is positioned as an emotional intelligent electric coupe with future-looking styling design immersive smart space and all-scenario intelligent driving as product highlights to meet the needs of high-end intelligent electric vehicle users in all scenarios.Note: The features and configurations mentioned in “II. Analysis of Core Business in 2022” in Chapter 3 are not a true representation of the features and configurations of actual vehicles. the actual configuration and functions of the model shall be subject to the official product configuration table..Vehicle manufacturing production and operation during the reporting period √ Applicable □ Not applicable Production and sales of vehicles Production Volume (Unit) Sales Volume (Unit) YoY YoY 2022 2021 increase/decrease 2022 2021 increase/decrease (%)(%) By Region Domestic 2049250 2130925 -3.83% 2096982 2141390 -2.07% Overseas 249169 159140 56.57% 249169 159140 56.57% Note: 1. The above sales and production volume includes vehicles produced and sold by the Company and its JVs and associates. 2. Production capacity: In 2022 the design capacity is 2.29 million vehicles. The capacity utilization rate reached 71.9%. In the past three years the backward production capacity for 0.41 million vehicles and 0.45 million engines have been shut down. The capacity for 0.25 million connected and 0.1 million batteries have been built. The capacity structure is gradually adjusted to new energy.Cause description of over 30% year-on-year increase/decrease √ Applicable □ Not applicable The production and sales volume of overseas regions increased by more than 30% mainly due to the insufficient supply of overseas markets and in recent years Chinese brands represented by Changan Automobile have gradually established competitive advantages in the field of new energy and intelligence driving the growth of overseas exports.Construction of parts supporting system Changan Automobile's main models such as the CS series UNI series and navy brand are equipped with parts that combine in- house production and external procurement. Key components such as Blue Core's new generation of high-pressure direct injection engine are independently developed by the company which can effectively control costs and enhance the quality control of key parts through self-production; In cooperation with international and domestic first-class parts and components enterprises such as Huawei autonomous driving intelligent cockpit CATL new energy battery Aisin 8AT manual automatic transmission Chongqing Tsingshan Industrial 7-speed wet dual-clutch transmission Wutong TINNOVE intelligent system etc. through external procurement integrate 17Chongqing Changan Automobile Company Limited 2022 Annual Report industry resources select suitable suppliers accelerate the transformation into intelligent low-carbon mobility technology companies make products safer smarter and greener maximize corporate interests and provide support for the continuous improvement of the company's performance.It has organized a total of 516 suppliers and more than 3800 people to study a series of QCA (Changan Automobile Supplier Quality Capability Assessment System) courses and completed 84 QCA certification audits in 2022. The company has long implemented the quality capability evaluation strategy implemented hierarchical management and continuously promoted the improvement of supplier quality management capabilities.The production and operation of auto parts during the reporting period □Applicable √ Not applicable The company conducts auto finance business □Applicable √ Not applicable The company conducts NEV-related business √ Applicable □ Not applicable Production and operation of new energy vehicles and parts By Category Production Capacity (unit) Production Volume (unit) Sales Volume (unit) New Energy Passenger Vehicle 1090000 249646 252584 New Energy Commercial Vehicle 170000 19163 18656 Note: The revenue from the sales of new energy vehicles within the scope of the company's consolidated financial statements is RMB 9028 million in the reporting period. III. Core Competence Analysis 1. Scientific and technological research capability. The company adheres to innovation-led development and pushes the implementation of science technological development plan at full speed. Changan strengthens investment in scientific and technological innovation guides by user needs adheres to the “two-wheel drive” of scientific and technological innovation and ecological construction achieves a number of technological industry leading first-stage mass production and makes new breakthroughs in product development and technological innovation. In the intelligent field intelligent driving intelligent network connection and intelligent interaction technologies are supported to realize intelligent network operation and build an intelligent vehicle platform in stages. APA6.0 remote intelligent parking and AEB automatic Emergency braking equipped with UNI-V won the gold medal of the 2022 World Intelligent Driving Challenge and the Special prize of the Smart Connected Car Challenge. In the field of new energy technology in the aspect of battery completed the prototype development of semi-solid cell independently mastered the CTP integration technology. In terms of electric drive it broke through core technologies such as silicon carbide (SiC) control realized the "7-in-1" super collector drive industry debut and won the "China Heart" 2022 top 10 new energy vehicle power system. In terms of electric control the seven-in-one "wisdom core" is independently developed and mass-produced to Deepal SL03. As of December 2022 the company has 8330 patents at home and abroad including 2148 invention patents. 2. Product definition capability. The company adheres to customer experience as the orientation focuses on user needs and constantly innovates product definition mode to further improve the matching degree between products and user needs. Continuously updating and iterating product market equations strengthening differentiated functions such as personalized configuration and vehicle software for fuel and electrification products to enhance product competitiveness. For new automobile products review the user operation and resource matching links and promote the product to the full life cycle user experience. The company's key products in 2022 perform well. CS series UNI series Auchan Z6 and other key products are favored by the market. Also Avatr 11 enters the critical delivery period and Deepal SL03 quickly grabs the mainstream passenger car market. The company will continue to focus on the user experience focus on the core scene and quickly build a differentiated competitive advantage of popular products. At the same time the company will improve Avatr Deepal and new automobile product matrix promote the full renewal of existing brand electrification products and strive to provide users with product experience beyond expectations. 3. Brand upward capability. The company insists on strengthening brand value management further consolidating the "intelligent" and "electric" brand label innovating brand promotion improving brand customer satisfaction and helping the brand to move up. In terms of brand value management build a new Changan brand structure plan Smart Electric iDD product sequence expand the electrification market start the construction of new mainstream electric OX sequence and achieve a breakthrough in brand development. Released new digital pure electric brand Shenlan and "Zhuge smart" "Force Electric" " Smart Electric iDD" and "Partner +" four brand labels innovation to build brand equity. In terms of brand promotion Changan will focus on the launch of 7 new cars such as the second-generation CS75PLUS and Rui Cheng PLUS and create innovative cross-border cooperation series such as Sanxingdui Migu Music Festival Dragon Gate King Kong and Talk Show so as to win the exclusive title of animation of the Three-Body Problem a national science fiction IP to help the brand get younger and accelerate the brand exposure and popularity. In terms of improving brand customer satisfaction the customer satisfaction (SSI/CSI namely sales service satisfaction/after-sales service satisfaction) in 2022 reached more than 99%. In addition the company won the second place of its own brand in J.D.Power's 18Chongqing Changan Automobile Company Limited 2022 Annual Report 2022 China Auto sales service Satisfaction ranking. 4. Intelligent manufacturing capability. The company focuses on the digital transformation of the new factory and explores the digitalization and digitalization of business in the whole scenario of the factory. Changan will make new progress in smart and green manufacturing under the model of innovative manufacturing. Further promote the application of 5G technology and the construction of industrial Internet in each manufacturing base and put 5G+AR remote maintenance and intelligent fault diagnosis 5G+ machine vision detection and other scenes into operation greatly improving the one-time detection accuracy and logistics distribution efficiency. The company orderly implements the user direct connection manufacturing mode (C2M) and fully realize the mass customization mode of new energy products to meet the personalized needs of users. Also centering on the five dimensions of "technological transformation process optimization quality improvement production scheduling optimization and lean start-stop" a number of carbon reduction measures have been formulated and implemented to further reduce the carbon emission intensity of single and single vehicles. In the 2022 China New Car Quality Study (IQS) released by J.D.Power (Jundi) Changan Automobile won the first prize in “Quality of new cars of China’s homegrown brands” the Getaway PLUS won the second prize in "medium base sedan" and the CS35PLUS won the third prize in "Compact SUV". 5. Cultural leadership capability. The company insists on improving the cultural system and iteratively updating the leading cultural concept (fourth edition) to further gather strategic consensus and stimulate the spirit of struggle. The company actively carries out a series of activities for the 160th anniversary of Changan telling good Changan stories inheriting Changan culture drawing great power of innovation and entrepreneurship from the history of Changan and continuously creating an atmosphere of "leading culture · Wolf Changan". The company further implements the "double concern" carries out the "I do practical things for the people" on a regular basis and solves the problem of employees' "urgent difficulties and worries". At the same time the company firmly practices social responsibility actively responds to the call of the CPC Central Committee deeply implements the rural revitalization strategy carries out cross-border Youyang Tea oil help action and forms the "Changan Plan" for rural revitalization. Changan immediately rushed to the aid of Chongqing wildfire donating 10 million yuan. The company actively supported Sichuan earthquake relief and donated 10 Kaicheng F70 cars to contribute to Changan. 6. Mechanism and efficiency capacity. The company insists on improving the organization mechanism replenishing the talentteam and optimizing the incentive scheme to inject new vitality into the transformation and development. We have established a “smilecurve” management logic formed a matrix and flat management model and built organizational capabilities to support the realization of new automotive products; continued to introduce cutting-edge talents in the fields of intelligence software and modeling externally and promoted the transformation of talents in the fields of intelligent network “three-electric” and new platform internally. The company also promotes the tenure system and contract management to further enhance the vitality of cadres and stimulate the motivation of managing officers; improves the incentive “team leader” mechanism to help tackle important and difficult technical projects; implements the equity incentive plan to further stimulate the vitality and motivation of employees and promote the achievement of strategic tasks; carries out the follow-up mechanism of product projects in depth and the core personnel of the whole value chain of the project are closely bound to the successful implementation of the product; the construction of a comprehensive honor system to stimulate a greater sense of mission achievement and striving with spiritual incentives; the deferred bonus incentive policy has been increased again and the enthusiasm of the staff is greatly strengthened.IV. Analysis of Main Business 1. Overview Compared with 2021 the company's operating income was RMB 121.253 billion an increase of 15.32%. And it is caused by the company's sales growth. The net operating cash flow was 5.666 billion yuan a decrease of 75.33% over last year. The company's net profit attributable to the shareholders of the listed company during the reporting period was 7.798 billion yuan and it was growth by 119.52% compared to 2021. The positive net profit mainly due to the increase in sales volume of the company's own sector and the improvement of operating quality. The substantial increase in profit year-on-year. In addition the overall profitability of the JVs andassociates sector has decreased and please see "IX. Analysis of Major Shareholding and Joint Stock Companies “under this chapter.Please refer to “II Analysis of Main Business” under this chapter. 2. Income and cost (1) Revenue 20222021 Proportion of Proportion of YoY Amount (RMB) operating revenue Amount (RMB) operating revenue increase/decrease %(%)(%)（） Operating revenue 121252864085.40 100% 105141877237.05 100% 15.32% By industry Automotive business 121252864085.40 100% 105141877237.05 100% 15.32% By product Vehicles 114066406439.25 94.07% 99238618010.70 94.39% 14.94% 19Chongqing Changan Automobile Company Limited 2022 Annual Report Services and others 7186457646.15 5.93% 5903259226.35 5.61% 21.74% By region China 107841417091.18 88.94% 97338405886.42 92.58% 10.79% Overseas 13411446994.22 11.06% 7803471350.63 7.42% 71.87% By sales model Distribution 103713980228.17 85.53% 96492889603.69 91.78% 7.48% Direct selling 10352426211.08 8.54% 2745728407.01 2.61% 277.04% Others 7186457646.15 5.93% 5903259226.35 5.61% 21.74% Note: The Company has 2164 dealers at the end of the reporting period. (2) The business products regions and sales model accounting for over 10% of the Company’s operating revenue or operating profit √ Applicable □ Not applicable YoY YoY YoY Operating Revenue Operating Cost Gross increase/decrease of increase/decrease increase/decrease (RMB) (RMB) margin operating income of operating cost of gross margin (%)(%)(%) By industry Automotive business 121252864085.40 96409610873.76 20.49% 15.32% 10.00% 3.85% By product Vehicles 114066406439.25 91604889306.21 19.69% 14.94% 9.18% 4.24% By region China 107841417091.18 83836238670.05 22.26% 10.79% 4.66% 4.55% By sales model Distribution 103713980228.17 81908748404.43 21.02% 7.48% 0.66% 5.35% Where the statistical caliber of the main business data of the Company is adjusted the data is subject to the main business data after adjustment according to the caliber of the end of the report period in the latest year.□ Applicable √ Not applicable (3) Whether revenue from physical sales is higher than service revenue √ Yes □ No By business Item 2022 2021 YoY increase/decrease (%) Sales volume (unit) 2346151 2300530 1.98% Production volume (unit) 2298419 2290065 0.36% Automotive business Inventory volume (unit) 54900 64557 -14.96% Market share（%） 8.73% 8.74% -0.01% Note: The above sales and production volume includes vehicles produced and sold by the Company and its JVs and associates. The analysis over market share is based on the data from China Automobile Industry Association.Cause description of over 30% year-on-year increase/decrease □ Applicable √ Not applicable (4) Performance of major sales and purchase contracts as of the end of the reporting period □ Applicable √ Not applicable (5) Cost By business Item 2022 2021 20Chongqing Changan Automobile Company Limited 2022 Annual Report Proportion Proportion YoY Amount (RMB) of operational Amount (RMB) of operational increase/decrease cost (%) cost (%) (%) Products 91604889306.21 95.02% 83904632708.41 95.73% 9.18% Automotive business Services and others 4804721567.55 4.98% 3744072825.73 4.27% 28.33% Total 96409610873.76 100.00% 87648705534.14 100.00% 10.00% (6) Whether the scope of consolidation was changed during the reporting period √ Applicable □ Not applicable During the reporting period Avatr completed a capital increase and equity expansion to introduce new investors. After this capital increase the company lost control of Avatr and no longer included it in the company's consolidated financial statements. As of the end of the reporting period the company holds 40.99% equity in Avatr. (7) Major changes or adjustment in business product or service of the Company in the reporting period □ Applicable √ Not applicable (8) Major customers and suppliers Major customers Total sales revenue from top five customer (RMB) 11027129512.08 Proportion of total sales revenue from top 5 customers in annual total sales revenue (%) 9.10% Proportion of total sales revenue from affiliated parties in the top five customers in annual total sales revenue (%) 4.76% The top 5 customers No. Customer Revenue (RMB) Proportion of annual total sales revenue (%) 1 Customer One 3891334275.79 3.21% 2 Customer Two 2609084124.78 2.15% 3 Customer Three 1684301990.87 1.39% 4 Customer Four 1476308931.64 1.22% 5 Customer Five 1366100189.00 1.13% Total 11027129512.08 9.10% Other information regarding major customers √ Applicable □ Not applicable One of the above customers is a joint venture of the Company and two customer is controlled by the same ultimate holding company. Please refer to item 5 of Note 10 "Related Party Relationships and Transactions" in Chapter 10.Major suppliers Total purchase amount from top five suppliers (RMB) 17209662321.50 Proportion of total purchase amount from top five suppliers in annual total purchase amount (%) 17.85% Proportion of total purchase amount from affiliated parties of the top five suppliers in total annual total purchase amount (%) 14.61% Top 5 suppliers No. Supplier Purchase amount (RMB) Proportion of annual total purchase amount (%) 1 Supplier One 5929105477.16 6.15% 21Chongqing Changan Automobile Company Limited 2022 Annual Report 2 Supplier Two 4693770740.03 4.87% 3 Supplier Three 3463898449.23 3.59% 4 Supplier Four 1683131736.33 1.75% 5 Supplier Five 1439755918.75 1.49% Total 17209662321.50 17.85% Other information regarding major suppliers √ Applicable □ Not applicable One of the above suppliers is a joint venture of the Company one supplier is controlled by the same ultimate holding companyand one supplier is a company in which the ultimate holding company participates. Please refer to item 5 of note 10 “Related PartyRelationships and Transactions” in Chapter 10. 3. Expenses Item 2022 2021 YoY Change (%) Explanation of major changes Selling expenses (RMB) 5138270162.95 4645654234.59 10.60% Administrative expenses (RMB) 3532458198.76 3499654508.49 0.94% Due to the year-on-year increase in the average monthly monetary fund Financial costs (RMB) -1017305743.08 -780923197.18 30.27% balance of the company during the reporting period the interest income from deposits in financial institutions increased R&D expenses (RMB) 4315444864.76 3515029178.76 22.77% 4. Research and Development Investment √Applicable □ Not applicable Expected impact on the Projects Purpose Progress Goals future development of the Company Advanced Comfort Car The first product of the new Complete the annual Develop new smart electric Develop new products to Development series to enhance market development task vehicles and launch the enhance market competitiveness model as planned competitiveness Development of a new Develop new products to Develop a new generation of Develop new products to generation of plug-in enhance market Complete the annual plug-in hybrid models and enhance market hybrid models competitiveness development task launch the model as planned competitiveness Development of a new Changan New Energy's first Develop new smart electric Develop new products to generation of all-electric pure electric platform Complete the annual development task vehicles and launch the enhance market digital car strategic model model as planned competitiveness Development of intelligent Create a leading hardware Complete the annual Complete the development of Transformation and electric digital platform and software platform development task main functions and lock the technical status upgrading of new vehicles Accelerate the Break through the technical Complete the development of transformation to intelligent Development of a new- generation all-electric bottleneck and strengthen Complete the annual the platform to achieve low-carbon travel technology companies and intelligent vehicle platform electrification and development task platform-based synergy intelligence capabilities intelligence and electrification support the development strategy of ' new automobile new ecology '.Expand and optimize the Enrich the company's Multi-power compatible Changan compatible platform architecture Complete the annual system architecture realize product power selection architecture vehicle supports multi-power development task multi-power platform and improve the platform development products common platform development efficiency and development cost 22Chongqing Changan Automobile Company Limited 2022 Annual Report R&D staff 2022 2021 Change over the previous year (%) Number of R&D staff (person) 7899 7269 8.67% Proportion of R&D personnel 18.42% 17.13% 1.29% Education background —— —— —— High School diploma or below (person) 262 281 -6.76% Bachelor’s degree (person) 5819 5467 6.44% Master’s degree (person) 1738 1443 20.44% Doctor’s degree (person) 80 78 2.56% Age structure —— —— —— Aged below 30 (person) 2217 2067 7.26% Aged 30 - 40 (person) 4682 4421 5.90% Aged above 40 (person) 1000 781 28.04% R&D Input 2022 2021 Change over the previous year (%) Amount of R&D Input (RMB) 5677807968.36 4826946503.77 17.63% Proportion of R&D Input in Operating Revenue (%) 4.68% 4.59% 0.09% Amount of Capitalized R&D Expenditure (RMB) 1362363103.60 1311917325.01 3.85% Proportion of Capitalized R&D Expenditure in R&D Input (%) 23.99% 27.18% -3.19% Cause and effects of significant changes in composition of the R&D staff □ Applicable √ Not applicable Cause for significant changes in the proportion of total R&D investment in operating revenue from the previous year □ Applicable √ Not applicable Cause and Reasonable Explanation of the major changes of the capitalization rate of R&D investment □ Applicable √ Not applicable 5. Cash Flow Unit: RMB YoY Change Item 2022 2021 (%) Subtotal of cash inflows from operating activities 127195228996.80 132847688924.95 -4.25% Subtotal of cash outflows from operating activities 121528882138.28 109875965714.11 10.61% Net cash flows from operating activities 5666346858.52 22971723210.84 -75.33% Subtotal of cash inflows from investing activities 2492217372.08 1450454543.93 71.82% Subtotal of cash outflows from investing activities 5446189241.05 2939679984.95 85.26% Net cash flows from investing activities -2953971868.97 -1489225441.02 -98.36% Subtotal of cash inflows from financing activities 2792324450.65 1826518075.81 52.88% Subtotal of cash outflows from financing activities 2567894182.64 4422477490.74 -41.94% Net cash flows from financing activities 224430268.01 -2595959414.93 108.65% Net increase in cash and cash equivalents 2973518212.75 18861948777.36 -84.24% Description of major influence factors of significant change of relevant data on a year-on-year basis √ Applicable □ Not applicable In 2022 the net cash flow generated from operating activities decreased by 17.305 billion yuan compared to the previous year.On the one hand due to the impact of market supply and demand the proportion of cash paid by distributors decreased resulting in a decrease in cash received from selling goods and providing services. On the other hand to support the supply chain relatively loose policies were adopted for supplier payments resulting in an increase in cash paid for purchasing goods and receiving services.The net cash flow generated from investment activities decreased by 1.465 billion yuan compared to the previous year mainly due to the payment of investment funds to Chongqing Changan New Energy Vehicle Technology Co. Ltd. and Avatr Technology (Chongqing) Co. Ltd. in the current period resulting in an increase in cash paid for investment compared to the previous year. 23Chongqing Changan Automobile Company Limited 2022 Annual Report The net cash flow generated from financing activities increased by 2.82 billion yuan compared to the previous year mainly due to the impact of restricted monetary changes resulting in a significant increase in "other cash received related to financing activities" and a significant decrease in "other cash paid related to financing activities" compared to the previous year.Cause for the significant difference between net cash flows from operating activities and net profit in the reporting period √ Applicable □ Not applicable As for the significant difference between net cash flows from operating activities and net profit in the reporting period please refer to the Item 63 Note 5 “Supplementary Information of the Cash Flow Statement” in the Auditor’s Report.V. Analysis of Non-Main Business √ Applicable □ Not applicable Amount (RMB) Proportion of profits (%) Explanation Whether it is sustainable or not Except for 2.13 billion yuan which is the Please refer to the Item 52 company's uncontrollableNote 5 “Supplementary equity interest in AvatrReturn on investment -768957070.79 -9.98% Information of the Cash and the remaining equity isFlow Statement” in the remeasured at fair value to Auditor’s Report. generate profits other sustainable assets are available Profits or losses of fair value change 3570229.29 0.05% No Please refer to the Item 55Impairment losses on Note 5 “Supplementaryassets -945853716.20 -12.27% Information of the Cash No Flow Statement” in the Auditor’s Report.Non-operating income 128910416.79 1.67% No Non-operating expenses 54391039.79 0.71% No VI. Analysis of Assets and Liabilities 1. Major Changes in Asset Composition 31 December 2022 31 December 2021 Increase/Decrea Amount (RMB) Proportion of Proportion of se in Proportion Description of total assets (%) Amount (RMB) total assets (%) (%) significant changes Monetary fund 53530183827.34 36.65% 51976242149.37 38.39% -1.74% Mainly due to the increased impact of Receivables 3068414415.29 2.10% 1675427534.87 1.24% 0.86% accounts receivable for outsourcing and project development Contract assets 458389187.10 0.31% 1151292247.36 0.85% -0.54% Inventories 5823307512.90 3.99% 6852874420.59 5.06% -1.07% Investment property 6422715.04 0.00% 6649426.60 0.00% 0.00% Long-term equity investment 14406662456.28 9.86% 13245374860.55 9.78% 0.08% Fixed assets 19346764691.44 13.25% 21325959850.16 15.75% -2.50% Construction in progress 1387898218.64 0.95% 1460176539.43 1.08% -0.13% Right-of-use assets 100813386.01 0.07% 66313062.98 0.05% 0.02% Short-term loans 29000000.00 0.02% 19000000.00 0.01% 0.01% Mainly due to the high matching between dealer Contract liabilities 5655256792.66 3.87% 9840509514.39 7.27% -3.40% demand and manufacturer inventory resources resulting in a decrease 24Chongqing Changan Automobile Company Limited 2022 Annual Report in advance payments Long-term loans 36000000.00 0.02% 600000000.00 0.44% -0.42% Lease liabilities 60205397.98 0.04% 38679735.59 0.03% 0.01% Mainly due to the year-on-year increase in year-end sales and Notes receivable 35849660652.96 24.55% 24267633416.65 17.92% 6.63% the impact of an increase in the proportion of dealer bill payments Mainly due to the deferred tax assets 3028487187.18 2.07% 2280819516.99 1.68% 0.39% impact of increased balance of deductible items Mainly due to the Other payables 6082766424.67 4.16% 4562626344.69 3.37% 0.79% impact of prepaid land and factory disposal funds Mainly due to the share capital 9921799422.00 6.79% 7632153402.00 5.64% 1.15% impact of converting capital reserves into equity Foreign assets account for a relatively high proportion □ Applicable √ Not applicable 2. Assets and liabilities measured at fair value √ Applicable □ Not applicable Unit: RMB Changes in Accumulated Provision Item Opening Fair Value Fair Value for Amount of Amount of Sales Balance Gains and Changes Impairment Purchase in in Current Other Changes Closing Balance Losses in Included in in Current Current Period Period Current Period Equity Period Financial assets Financial assets held for trading (excluding 195798300.00 3570229.29 98999997.80 18052956.00 280315571.09 derivative financial assets) Investments in other equity 701409600.00 -5500000.00 205959600.00 489950000.00 instruments Subtotal financial assets 897207900.00 3570229.29 -5500000.00 98999997.80 205959600.00 18052956.00 770265571.09 Others - - - - - - - Total 897207900.00 3570229.29 -5500000.00 98999997.80 205959600.00 18052956.00 770265571.09 Financial liabilities - - - - - - -Note: The trading financial assets and investments in other equity instruments in the table above are detailed in “2. Trading FinancialAssets” and “11. Investments in Other Equity Instruments” in Note 5 of Auditor’s Report .Whether there are major changes on measurement attributes for main assets of the Company in reporting period □ Yes √ No 3. Limitation of asset rights as of the end of the reporting period Unit: RMB Item Book Value at the End of Period Limitation Reason Monetary fund 1038748779.60 Acceptance bill deposit Bill receivable 6340255963.00 Pledge used to issue notes payable Intangible assets 16823861.76 Obtaining working capital mortgage loans 25Chongqing Changan Automobile Company Limited 2022 Annual Report Fixed assets 29963526.50 Obtaining working capital mortgage loans Total 7425792130.86 VII. Analysis of Investments 1. Overall situation √ Applicable □ Not applicable Item Investment amount for the Investment amount for the reporting period (RMB) previous reporting period (RMB) YoY Change (%) Equity investments 5170467840.00 867235994.00 496.20% Fixed assets 17301970.59 26662625.05 -35.11% Construction in progress 1749624706.95 1516873296.63 15.34% Intangible assets 145975646.19 61121381.78 138.83% Total 7083370163.73 2471893297.46 186.56% Joint investment between the Company and professional investment institutions: Subscribed Actual Name of investment institutions capital Subscription capital contribution ratio (%) contribution Progress (RMB) (RMB) Chongqing Changan Innovation By the end of the reporting period the Private Equity Investment Fund 300000000 46.08% 1000000 filing procedures for private equity Partnership (Limited Partnership) investment funds have been completed Chongqing Lianzhi Antou Equity As of the end of the reporting period Investment Partnership (Limited 200000000 50.25% 0 the operation of the partnership has Partnership) been terminated and cancelled 26Chongqing Changan Automobile Company Limited 2022 Annual Report 2. The major equity investment obtained in reporting period √ Applicable □ Not applicable Profit and Whethe Investment Shareho Progress Expe loss on Name of Main Investm Investm r it is Discl amount lding Capital Product as of the cted investmen investee busines ent Partner ent involve osure Disclosure Index （10000RM proporti source type balance reven ts for thecompany s mode term d in a date B） on sheet date ue current lawsuit period National Green Development Fund Co. Ltd; Jiaxing Lizhanye No. 6 Equity Investment Partnership Please refer to the (Limited Partnership); Qingdao Yuewan Smart announcement of Network Industrial Investment Fund Partnership“Announcement(Limited Partnership); Huzhou Chuangsheng Sales of Completio on Related Chiming Equity Investment Partnership (Limited new n of Transactions of Self- Partnership); Chongqing Cheng'an No. 2 Private New Not cars and Capital Long- agreement Not 2022/ Capital Increase to Avatr 116900.00 40.99% owned Equity Investment Fund Partnership (Limited energy appli No new increase term signing applicable 8/3 Associated funds Partnership); Tianjin Weihao Haihe Phase I Equity vehicles cableenergy and Enterprises” on Investment Partnership (Limited Partnership); vehicles delivery http://www.cninfo Ningbo Yongxin Weihao Phase I Semiconductor.com.cn(Announc Industry Investment Partnership (Limited ement Number: Partnership); Yiwu Weihao Chuangxin Phase I Equity 2022-55) Investment Partnership (Limited Partnership); Southern Industrial Asset Management Co. Ltd Total -- -- 116900.00 -- -- -- -- -- -- -- -- -- 27Chongqing Changan Automobile Company Limited 2022 Annual Report 3. The ongoing major non-equity investment in reporting period □ Applicable √ Not applicable 4. Financial assets investment (1) Security investments √ Applicable □ Not applicable Accumula Accountin Gains and ted fair Purchase Sales Book value at the losses from amount amount Gains and Security Stock g value losses of the Book value at the Account type code Abbreviation I nitial investment beginning of the changes in fair changes during the during the reporting end of the Source cost RMB measurem（ ） ent model reporting period value during ing the period included reporting reporting period reporting period of funds（RMB） in equity period period RMB （RMBsubject ） （RMB （ ）） RMB （RMB） （RMB） （ ） Fair value Trading Self- Stock 600369 Southwest Securities 50000000.00 measurem 177902700.00 -51790200.00 0.00 0.00 0.00 -49099800.00 126112500.00 financial owned ent assets funds China Fair value Trading Self- Stock 301215 Automobile 98999997.80 measurem -- 26052631.00 0.00 0.00 0.00 26651841.51 125052628.80 financial owned Corporation ent assets funds Total 148999997.80 -- 177902700.00 -25737569.00 0.00 0.00 0.00 -22447958.49 251165128.80 -- -- (2) Derivative investments √ Applicable □ Not applicable 1） Derivative investments for hedging purposes during the reporting period √ Applicable □ Not applicable Unit: 10000 RMB Initial Profit and loss Accumulated Amount of Amount of Investment Proportion of investment Investment type of derivatives derivatives from changes in changes in fair purchase in sales in the amount at the amount at the end of the investment fair value in the value included the reporting reporting end of the reporting reporting period to net amount current period in equity period period period assets of the Company Forward Exchange 0 2915 2915 85419 0 85419 1.36% Total 0 2915 2915 85419 0 85419 1.36% Explanation of changes of the accounting policies and accounting principles of the Company’s hedging Not applicable during the reporting period compared with the previous reporting period Description of actual gains/losses during the reporting period No contract delivery no actual profit or loss occurred.Changan Automobile adheres to the principle of risk neutrality in carrying out forward foreign exchange settlement and Description of hedging effect sales business based on normal production and operation locks in income and cost through forward foreign exchange transactions avoids the risk of exchange rate fluctuations reduces the uncertainty of operating profits and ensures the realization of annual operating objectives.Source of funds Self-owned funds Risk analysis 1. Market risk: In the case of large changes in the exchange rate the difference between the exchange rate of the forward exchange contract and the actual exchange rate on the expiration date may cause the Company to lose money.Risk analysis and control measures for 2. Liquidity risk: The foreign exchange hedging business is based on the Company’s foreign exchange assets and derivatives investment during the liabilities and matches the actual foreign exchange receipts and expenditures to ensure that there are sufficient funds for reporting period (including but not liquidation at the time of delivery so as to reduce the cash flow demand on the maturity date.limited to market risk liquidity risk 3. Default risk: Due to inaccurate forecasts the delivery date signed by the forward exchange transaction is inconsistent credit risk operational risk legal risk with the actual delivery period resulting in the delayed delivery risk caused by the failure of the forward exchange etc.) transaction to be delivered at the agreed time. 4. Operational risk: Forward exchange transactions are complex which may cause risks due to imperfect internal control and unprofessional operators. 5. Legal risks: If the terms of the transaction contract are not clear the Company may face legal risks. Risk control measures 28Chongqing Changan Automobile Company Limited 2022 Annual Report 1. The Company and its subsidiaries will pay attention to the changes in the exchange rate market strengthen the study of exchange rates study the future exchange rate trends improve the forecasting ability of exchange rates and reduce the impact of exchange rate fluctuations on the Company. 2. In order to prevent delayed transaction settlement of forward exchange the business management departments of the Company and its subsidiaries will track the progress of payment and collection avoid overdue payments and try to reduce the risk to the minimum. 3. The Company and its subsidiaries will strengthen business knowledge training improve the comprehensive business quality of relevant personnel and improve the ability to identify and prevent exchange rate risks. 4. The Company has formulated the “Measures for the Administration of Forward Exchange Trading Business (Trial)” which clearly stipulates the business operation principles approval authority internal operation processes and requirements risk handling procedures etc. and the operation must be handled in strict accordance with the requirements of the measurements.Changes in market price or fair valueof invested derivatives during the The Company’s measurement of Financial Instruments follows the “Accounting Standard for Business Enterprisesreporting period (the specific methods Article 22 - Recognition and Measurement of Financial Instruments” and the fair value is basically measured and relevant assumptions and parameters recognized with reference to bank pricing. During the reporting period the gain on the change in fair value of forward used in the analysis of the fair value exchange contracts was RMB 29.15 million.should be disclosed) Whether it is involved in a lawsuit Not applicable Disclosure date of derivatives investment approval board February 23 2022 announcement Disclosure date of derivatives investment approval shareholders March 18 2022 meeting announcement The independent directors believed that the forward exchange transactions settled by the Company and its subsidiaries are based on normal production and operation needs with the principle of prudence and for the purpose of currency Opinions of independent directors on preservation and avoidance of exchange rate risks. For foreign exchange transactions it is necessary to reduce the riskthe Company’s derivatives investment of exchange rate fluctuations by locking the exchange rate. The Company has formulated the “Management Measuresand risk control for Forward Exchange Transactions (Trial)” and has improved the relevant internal control procedures. The targeted risk control measures taken by the Company are feasible. And the forward exchange transactions settled by the Company and its subsidiaries will abide by relevant laws and regulations and the Company’s relevant rules. 2） Derivative investment for the purpose of speculation during the reporting period □ Applicable √ Not applicable During the reporting period there was no derivative investment for the purpose of speculation. 5. Use of raised funds √ Applicable □ Not applicable (1) Overall use of raised funds √ Applicable □ Not applicable Unit: 10000 RMB The total The used amount of Cumulative Proportion amount of Total raised funds total amount of total The total The purpose Amount of Year Types of Total funds total funds accumulated with of raised raised amount of and placement funds raised raise raised raised in the use of funds purpose funds with funds with unused of the unused idle for current raised changed in purpose purpose funds funds more than period reporting changed changed two years period Non-public Deposited in a 2020 offering of 603929.76 69330.16 469260.07 160545.86 160545.86 26.58% 134669.69 dedicated 0 shares account for raised funds Total -- 603929.76 69330.16 469260.07 160545.86 160545.86 26.58% 134669.69 -- 0 Description of the overall use of raised funds 1. The board of directors of the Company believes that the Company has disclosed the storage and actual use of the Company’s raised funds in a timelytrue accurate and complete manner in accordance with the “Guidelines for the Standardized Operation of Listed Companies on the Shenzhen StockExchange” and relevant format guidelines. There are no violations in the management of raised funds. The Company has faithfully fulfilled its obligation to disclose the investment direction and progress of the raised funds. 2. The net amount of raised funds after deducting other issuance expenses is RMB 5986.08 million the actual net amount of raised funds after adjustment is RMB 6039.30 million. The Company used the raised funds of RMB 3252.08 million RMB 747.22 million and RMB 693.30 million respectively in 2020 2021 and 2022. As of December 31 2022 the Company has used a total of RMB 4692.60 million of the raised funds. 29Chongqing Changan Automobile Company Limited 2022 Annual Report (2) Use of the raised funds in committed projects √ Applicable □ Not applicable Unit: 10000 RMB Cumulative Committed projects and Whether Total Adjusted investment Investment Whether the Whether it Whether the placement of extra funds the project committed total Amount invested amount as progress as of project has Benefits feasibility of has been investment of investment of the end the end of the reached the realized this meets the the project has raised changed raised funds (1) this year of the period% (3) = intended year expected return changed period (2) (2)/(1) usable state significantly Committed projects H series fifth phase NE1 series first phase engine production capacity Yes 141568.38 103313.68 17031.87 100831.01 98% No Not Not applicable applicable No construction project Crash Laboratory Capacity Yes 11505.75 8251.85 2076.08 8042.02 97% No Not Not Upgrade Project applicable applicable No Clarificatio n can only CD569 production line construction project Yes 15576.22 9418.59 4921.37 9433.27 100% Yes be made Not after the applicable No project cycle ends Hefei Changan Automobile Co. Ltd. adjustment and Yes 249958.06 142399.78 7555.82 133208.75 94% No Not Not upgrade project applicable applicable No Supplementary working capital No 180000.00 180000.00 - 180000.00 100% No Not Not applicable applicable No New generation energy- saving product No - 160545.86 37745.02 37745.02 24% No Not Not transformation and applicable applicable No upgrading project Total 598608.41 603929.76 69330.16 469260.07 78% -- -- -- -- The reasons for not reaching the planned progress or expected N/A benefits (by specific projects) Description of major changes in the feasibility of N/A the project The amount use and progress of extra raised Not applicable funds Change in implementation location of the committed N/A projects Adjustment to implementation method of N/A committed project On November 18th 2020 the Ninth Meeting of the Eighth Session of the Board of Directors of the Company reviewed and approved the Upfront investment and “Proposal on the Use of Raised Funds to Replace Early Investment in Self-Own Funds” and agreed to use raised funds of RMB replacement of committed 1378818553.05 to replace pre-invested sell-raised funds for the project. The replacement of the raised funds has been verified by the projects Ernst & Young Hua Ming (2020) Special Zi No. 60662431_D05 special report issued by Ernst & Young Hua Ming Certified Public Accountants (special general partnership).Use of idle raised funds for temporary supplement of N/A working capital There was a balance of the original project investment funds compared to upfront planning. The main reason is that the company has reduced the actual investment amount through the localization of imported equipment in the project implementation process in order to Amount and cause of reduce the investment in the project construction cycle and at the same time the company has continuously optimized the program in the surplus of funds raised for project construction process in order to continuously improve the quality of operation and lean investment process management has project implementation realized the control of the scale and rhythm of investment. According to the company’s long-term strategic planning and the current development needs after the company’s comprehensive research. In order to further improve the efficiency of the use of the raised funds the company intends to adjust the investment scale of the original raised funds investment projects and the expected balance of RMB 1605.46 million for the company’s new generation of energy-saving product transformation and upgrading projects. The purpose and placement Deposited in a dedicated account by the Company for raised funds 30Chongqing Changan Automobile Company Limited 2022 Annual Report of the unused raised funds Defects and other problems in utilization and disclosure N/A of the raised funds (3) Changes of projects supported by raised funds √ Applicable □ Not applicable Unit: 10000 RMB Total amount of The amount Actual Investment The date when Significant actually cumulative progress as the project Benefits Whether the changes in Changed project The commitment of the funds to be achieved the original project invested in invested investment of the end reached the during the expected feasibility the project during the amount as of of the intended benefits have after the reporting the end of the period (%) availability reporting been achieved of the change (1) period period (2) (3)=(2)/(1) status period project after the change 1. H series fifth phase NE1 series first phase engine pr A new oduction capacity construct generation of ion project energy-saving 2. Crash Laboratory Capaci products ty Upgrade Construction Project 160545.86 37745.02 37745.02 24% In the year of Not Not transformation 2023 applicable applicable No and upgrading 3. CD569 production line c projects onstruction project 4. Hefei Changan Automob ile Co. Ltd. adjustment and upgrade project Total -- 160545.86 37745.02 37745.02 24% -- -- -- -- 1. There was a balance of the original project investment funds compared to upfront planning. The main reason is that the company has reduced the actual investment amount through the localization of imported equipment in the project implementation process in order to reduce the investment in the project construction cycle and at the same time the company has continuously optimized the program in the project construction process in order to continuously improve the quality of operation and lean investment process management has realized the control of the scale and rhythm of investment.According to the company’s long-term strategic planning and the current development needs after the Reasons for change decision-making procedures and company’s comprehensive research. In order to further improve the efficiency of the use of the raised information disclosure (by specific project) funds the company intends to adjust the investment scale of the original raised funds investment projects and the expected balance of RMB 1605.46 million for the company’s new generation of energy-saving product transformation and upgrading projects. 2. Decision-making procedure: The Company held the 38th meeting of the 8th Board of Directors onApril 26th 2022 and approved the proposal of “Adjusting and Changing the Use of Part of the RaisedFunds”. The proposal has yet to be submitted to the Company’s General Meeting of Shareholders for consideration. 3. Information disclosure: Please refer to the announcement of “Adjusting and Changing the Use of Partof the Raised Funds” on http://www.cninfo.com.cn (Announcement Number: 2022-23).Reasons for failure to meet the planned schedule or projected benefits (by project) Not applicable Description of significant changes in the feasibility of the project after the change Not applicable VIII. Sale of significant Assets and Equity 1. Sale of significant assets □ Applicable √ Not applicable 2. Sale of significant equity □ Applicable √ Not applicable IX. Analysis of Major Shareholding and Joint Stock Companies √ Applicable □ Not applicable Major subsidiaries and joint stock companies that affect the company’s net profit by more than 10% 31Chongqing Changan Automobile Company Limited 2022 Annual Report Unit: 10000 RMB Main Registered Operating Name Type businesses capital Total assets Net assets Operating income profit Net profit Avatr Technology (Chongqing) Joint Stock Production and Co. Ltd. Company sales of vehicles 164466 521264 277307 2834 -201434 -201530 and parts Chongqing Changan New Energy Joint Stock Production and Vehicle Technology Co. Ltd. Company sales of vehicles 32811 2033628 109002 1567757 -319557 - 319656 and parts Changan Ford Automobile Co. Joint Stock Production and Ltd. Company sales of vehicles 24100 USD 3601827 153032 5106691 -114102 -244864 and parts Subsidiaries acquired and sold in the reporting period √ Applicable □ Not applicable During the reporting period Changan Automobile established a new subsidiary Chongqing Changan Technology Co. Ltd; Simultaneously completing the deregistration of Changan Brazil Holdings Limited Liability Company; Avatr Technology (Chongqing) Co. Ltd. introduced strategic investors lost control over them and no longer included them in the consolidation scope and made subsequent measurement according to the Equity method.Name Acquisition and disposal of subsidiaries Impact on overall production during the reporting period operation and performance Changan Brazil Holdings Co. Ltd Unregister None Chongqing Changan Technology Co. Ltd New Settings None Avatr Technology (Chongqing) Co. Ltd. Equity dilution Significant impact Description of major holding and participating companies Avatr is in a strategic investment period and has invested heavily in product research and development brand promotion channel building and technical talent introduction resulting in losses; Changan New Energy has increased investment in product R&D and brand promotion to accelerate the transformation of new energy strategy and brand advancement. At the same time it has suffered losses due to the increase in battery raw material costs and other factors; Changan Ford has shut down outdated production lines in order to accelerate revitalization and has made provision for asset impairment in the current period which has affected a significant decrease in profits.X. Information of main shareholding and joint stock companies □ Applicable √ Not applicable XI. Prospects of Future Development 1. Industrial Landscape and Tendency From the overall perspective of the automotive industry the demand side external demand slows down China's economy turns to domestic demand-driven with the recovery of travel scenarios and residents' confidence domestic consumer demand is gradually released it is expected that the trend of the automotive industry in 2023 will first decline and then rise and the total volume will increase slightly. (1) New energy and power trends: The low-speed growth of China's automobile market and the high-speed growth of new energy vehicles are clearly contrasted and the "fragmentation" of power structure and industrial scale coexist. China's new energy automobile industry has entered a period of explosive growth and sales are expected to increase by about 20% year-on-year in 2023.In the new energy vehicle market it is expected that XEV (plug-in hybrid + extended-range hybrid) will replace traditional fuel vehicles with its economy. (2) Intelligent industry trends: In intelligent vehicles intelligent driving and intelligent cockpits have become the fastest changing fields. In the field of intelligent driving after years of development and practice most enterprises have returned to rationality and focused on user scenarios to create excellent L2+ intelligent driving systems; The field of intelligent space is the most direct competition point for the user experience of various brands and it is also the main battlefield for brand differentiated experience. (3) Competitive trends: Chinese brands foreign brands new automakers and ICT companies compete on the same stage. Among them Chinese brands seize the strategic opportunities of the new energy market continue to give full play to the advantages of new energy technology intelligent ecological localization and cost control and continue to increase their market share in the passenger car market and it is expected that the market share will be close to 55% in 2023. (4) Overseas market trends: Based on the expectation of a global economic recession in 2023 overseas demand is weakened and it is expected that the increase in China's automobile exports will slow down in 2023 and the export growth rate is expected to be about 30%; In addition under the trend of global intelligent electrification of automobiles the relatively leading position of China's automobile industry coupled with China's engineer dividend lean management and other promoting factors gradually exporting products technologies and capital to the world Chinese car companies are expected to gradually develop from export-oriented to industrial investment-oriented in overseas markets. 32Chongqing Changan Automobile Company Limited 2022 Annual Report (5) Core supply chain trends of smart electric vehicles (chips and batteries): The supply and demand of automotive chips will remain structurally tight in 2023 and it is expected that the global supply of automotive chip production capacity will increase by about 20% and demand by about 40% in 2023. The price of battery materials remains high and volatile. 2. Corporation Development Strategy At present China in the new era is entering a period of coexistence of strategic opportunities and risks and challenges and increasing uncertainties and unpredictable factors Changan Automobile takes the initiative to identify and adapt to changes takes the company's "14th Five-Year Plan" development plan as the traction firmly adheres to the direction of the third entrepreneurship takes scientific and technological innovation as the driving force reshapes capabilities upgrades the industry and firmly and resolutely transforms into a smart low-carbon mobility technology company with a faster speed and greater intensity. By 2025 the Group aims to sell 3.5 million to 4 million units of which 2.8 million to 3 million units will be sold under the Changan brand. By 2030 the Group aims to achieve sales of 5 million units including 4 million units under the Changan brand during which it will make every effort to increase the penetration rate of new energy and accelerate the layout of overseas markets.In order to ensure the achievement of strategic goals we will focus on implementing the "five major breakthroughs" and fully promote the “two major changes”: ——Five breakthroughs (1) Strategic breakthrough Firmly promote the third entrepreneurship - innovation and entrepreneurship plan quickly implement the new energy "Shangri- La" plan and the intelligent "Beidou Tianshu" plan and create "new automobiles new ecology". (2) Brand breakthrough Further reconstruct the brand architecture and accelerate the creation of popular products. Focus on the three major brands of Changan Deepal and Avatr build differentiated brand value and create a new label of intelligent electric vehicles. Thereinto: Changan brand on the one hand integrates existing fuel vehicle brands such as "V" standard UNI series and Oshan accelerates electrification transformation and creates the "Smart electricity iDD" technology label. Integrate resources to achieve the goal of "increasing stock". By 2025 the company plans to launch 22 new products and maintain sales of 1 million units.On the other hand the creation of a new mainstream electric sequence OX sequence will be a new exploration of the transformation of the main brand of "Changan" to electrification. The OX sequence will increase the layout of mainstream EVs maximize the scale of expansion enhance the value of the main brand of "Changan" and strive to seize new tracks. We will select investment entities and open up special zones on the basis of existing channels to achieve full coverage of prefecture-level cities and core business districts. In the fourth quarter of 2023 the first product of the OX series will be officially launched and by 2025 it plans to launch five new products with sales estimated to exceed 800000 units.Deepal Auto further consolidates the brand positioning of young and high-tech digital pure electric vehicles combines the all- electric technology advantages of range extension pure electric and hydrogen electricity and comprehensively develops the mainstream electric market bringing users a young high-tech and pioneer intelligent low-carbon travel experience. By 2025 the company plans to launch seven new products with sales estimated to exceed 800000 units.Avatr is the strategic support of Changan Automobile brand. In 2022 the brand launch has been completed and the first product Avatr 11 and co-branded limited model 011 have been put on the market and sold which has been warmly received. In the future Avatr will continue to strengthen the brand emotional intelligent label occupy the high-end market and compete with new forces and luxury brands. Before 2025 it plans to launch 4 new products and the sales volume is estimated to exceed 300000-400000.Kaicheng Automobile integrates social resources promotes smart logistics demonstration operation accelerates the transformation to pickup trucks and smart logistics and realizes brand renewal. Before 2025 it plans to launch 7 brand new products and the sales volume is estimated to exceed 300000 to 400000 units.In the joint venture sector the company should adhere to the profit and market share orientation strengthen operation and management empower the parent company further expand the cooperation of "technology platform and overseas" and try best to open up a new era of joint venture. Seven new products are planned by 2025. (3) Overseas breakthrough The company will accelerate the construction of overseas strategic bases and strive to develop overseas markets. To build an international brand the company should follow the slogan "No base no overseas no overseas no Changan". (4) Technology breakthrough The company should deepen efforts in the fields of new energy and intelligence and develop key core technologies. (5) Ecology breakthrough The company will accelerate the new ecological layout improve the innovation chain integrate the capital chain strengthen the supply chain layout the industrial chain and explore new opportunities for value growth.——Two major changes The company should actively explore the two major changes of "new marketing new partners" and strive to open a new chapter of higher quality win-win cooperation. (1) New Marketing The company should keep up with the technological progress and the changing trend of the market review the asset-heavy model of 4S store distribution to the scene decoupling digital connection multiple combination of the new model. (2) New Partners 33Chongqing Changan Automobile Company Limited 2022 Annual Report Based on the principles of "equality mutual trust transparency security and synergistic resilience" the company should comprehensively build a new type of strategic cooperative partnership for customers. 3. Operation Plan The actual sales of the company in the reporting period reached 95.8% of the board's target with a year-on-year growth of 2.0% and the sales volume reached a five-year high. The operating goal of the board of directors in 2023 is to achieve production and sales of more than 2.53 million vehicles. In order to achieve the above goals the company adheres to the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era fully implements the Party's 20 great spirits and takes Innovation and Entrepreneurship Plan 6.0 as the main line. The company will set firm strategy steady and brave progress innovative development and strives to increase stock grab increment improve quality adjust structure keep bottom line and strengthen Party building.Changan will unswervingly promote transformation upgrading and high-quality development and will focus on the following tasks: first uphold the leadership of the Party and guide high-quality development through high-quality Party building. Second the company need to strengthen strategy implementation and draw a new blueprint for high-quality development. Third Changan needs to resolutely guard against and defuse major risks to ensure that production and operation targets are achieved. Fourth the company needs to adhere to innovation-driven make efficiency into the core competitiveness. Fifth the company should deepen reform and innovation to fully stimulate innovation and entrepreneurship. Sixth Changan should strengthen the incentive and restraint mechanism to stimulate the new vitality of organizational talents. Seventh the company needs to create a leading culture and gather the spirit of innovation and entrepreneurship among all staff. 4. Capital Expenditure Plan for 2023 In order to achieve the strategic goals of the company the investment plan of the company and its holding subsidiaries in 2023 is RMB 8648.59 million including RMB 479265 million fixed assets investment and RMB 3855.94 million equity investment.Investment in fixed assets is mainly invested in the four aspects of capacity structure adjustment research and development capacity new product launch and digital capacity to deepen the layout of new energy industry accelerate the pace of new energy product launch and continue to improve digitalization and research and development capacity. Equity investment is mainly to support independent new energy brands expand the scale expand overseas markets deepen the capital relationship with partners build intelligent research and development and forward-looking research capabilities and layout of intelligent and new energy core components. The company will study and formulate fund raising plans and fund use plans through various channels according to the project progress and combined with the operating and financing environment so as to improve the efficiency of fund use and reduce the cost of capital. 5. Possible Risks (1) Supply chain stability risk Due to multiple factors and contradictions the stability of the global supply chain system has decreased. The automotive industry may still face supply chain risks in areas such as chips and battery materials.Counterplan: first the company should strengthen the cooperation between the upstream and downstream enterprises of the industrial chain and reduce the risk of supply fluctuation through long-term agreements stockpiling risky components etc. Second the company needs to intensify independent development of key core components and continue to promote domestic alternatives for key core components. (2) Exchange rate fluctuation risk Since 2022 global inflation has heated up the US Federal Reserve has raised interest rates aggressively the US dollar has returned monetary policy fluctuations of major economies have significantly increased and economic growth has faced downward pressure.These factors may lead to a decline in the export volume of automobiles in some target markets.Counterplan: in the context of normal two-way exchange rate fluctuations the awareness of exchange rate risk should be enhanced the tracking of exchange rate changes should be strengthened and the risk of exchange rate loss should be reduced by gradually expanding the RMB settlement range or locking the settlement rate.XII. Reception Research Communication Interviews and Other Activities during the Reporting Period √ Applicable □ Not applicable Type of Reception Date Research Type Research Index place Object On February 22 For details see the February 24 2022 Shenzhen stock exchange 2022 Chongqing Field research Institution interactive (http://irm.cninfo.com.cn) on the Changan Automobile: February 22 2022 investor relations activities record sheet On April 29 Oneline Performance All investors For details see the May 6 2022 Shenzhen stock exchange interactive 34Chongqing Changan Automobile Company Limited 2022 Annual Report 2022 briefing (http://irm.cninfo.com.cn) on the Changan Automobile: April 29 2022 investor relations activities record sheet conference For details see the May 6 2022 Shenzhen stock exchange interactive On May 5 2022 calls conference calls Institution (http://irm.cninfo.com.cn) on the Changan Automobile: May 5 2022 investor relations activities record sheet conference For details see the May 9 2022 Shenzhen stock exchange interactive On May 6 2022 calls conference calls Institution (http://irm.cninfo.com.cn) on the Changan Automobile: May 6 2022 investor relations activities record sheet conference For details see the May 9 2022 Shenzhen stock exchange interactive On May 7 2022 calls conference calls Institution (http://irm.cninfo.com.cn) on the Changan Automobile: May 7 2022 investor relations activities record sheet conference For details see the May 11 2022 Shenzhen stock exchange interactive On May 9 2022 calls conference calls Institution (http://irm.cninfo.com.cn) on the Changan Automobile: May 9 2022 investor relations activities record sheet On May 10 conference For details see the May 11 2022 Shenzhen stock exchange interactive 2022 calls conference calls Institution (http://irm.cninfo.com.cn) on the Changan Automobile: May 10 2022 investor relations activities record sheet On May 11 conference For details see the May 13 2022 Shenzhen stock exchange interactive 2022 calls conference calls Institution (http://irm.cninfo.com.cn) on the Changan Automobile: May 11 2022 investor relations activities record sheet On May 12 conference For details see the May 13 2022 Shenzhen stock exchange interactive 2022 calls conference calls Institution (http://irm.cninfo.com.cn) on the Changan Automobile: May 12 2022 investor relations activities record sheet On May 18 conference For details see the May 20 2022 Shenzhen stock exchange interactive 2022 calls conference calls Institution (http://irm.cninfo.com.cn) on the Changan Automobile: May 18 2022 investor relations activities record sheet On May 19 conference For details see the May 20 2022 Shenzhen stock exchange interactive 2022 calls conference calls Institution (http://irm.cninfo.com.cn) on the Changan Automobile: May 19 2022 investor relations activities record sheet On May 23 conference For details see the May 24 2022 Shenzhen stock exchange interactive 2022 calls conference calls Institution (http://irm.cninfo.com.cn) on the Changan Automobile: May 23 2022 investor relations activities record sheet On May 25 conference For details see the May 27 2022 Shenzhen stock exchange interactive 2022 calls conference calls Institution (http://irm.cninfo.com.cn) on the Changan Automobile: May 25 2022 investor relations activities record sheet On May 26 conference For details see the May 27 2022 Shenzhen stock exchange interactive 2022 calls conference calls Institution (http://irm.cninfo.com.cn) on the Changan Automobile: May 26 2022 investor relations activities record sheet conference For details see the June 8 2022 Shenzhen stock exchange interactive On June 7 2022 calls conference calls Institution (http://irm.cninfo.com.cn) on the Changan Automobile: June 7 2022 investor relations activities record sheet On June 10 conference For details see the June 10 2022 Shenzhen stock exchange interactive 2022 calls conference calls Institution (http://irm.cninfo.com.cn) on the Changan Automobile: June 10 2022 investor relations activities record sheet On June 15 conference For details see the June 16 2022 Shenzhen stock exchange interactive 2022 calls conference calls Institution (http://irm.cninfo.com.cn) on the Changan Automobile: June 15 2022 investor relations activities record sheet On June 16 conference For details see the June 17 2022 Shenzhen stock exchange interactive 2022 calls conference calls Institution (http://irm.cninfo.com.cn) on the Changan Automobile: June 16 2022 investor relations activities record sheet On June 20 conference For details see the June 22 2022 Shenzhen stock exchange interactive 2022 calls conference calls Institution (http://irm.cninfo.com.cn) on the Changan Automobile: June 20 2022 investor relations activities record sheet On June 23 conference For details see the June 24 2022 Shenzhen stock exchange interactive 2022 calls conference calls Institution (http://irm.cninfo.com.cn) on the Changan Automobile: June 23 2022 investor relations activities record sheet On August 23 For details see the August 25 2022 Shenzhen stock exchange 2022 Chongqing Field research Institution interactive (http://irm.cninfo.com.cn) on the Changan Automobile: August 23 2022 investor relations activities record sheet On August 31 Performance For details see the September 2 2022 Shenzhen stock exchange 2022 Oneline briefing All investors interactive (http://irm.cninfo.com.cn) on the Changan Automobile: August 31 2022 investor relations activities record sheet On September conference For details see the September 19 2022 Shenzhen stock exchange 15 2022 calls conference calls Institution interactive (http://irm.cninfo.com.cn) on the Changan Automobile: September 15 2022 investor relations activities record sheet On September Chongqing Field research Institution For details see the September 30 2022 Shenzhen stock exchange 35Chongqing Changan Automobile Company Limited 2022 Annual Report 28 2022 interactive (http://irm.cninfo.com.cn) on the Changan Automobile: September 28 2022 investor relations activities record sheet On October 31 For details see the November 3 2022 Shenzhen stock exchange 2022 Oneline Performance briefing All investors interactive (http://irm.cninfo.com.cn) on the Changan Automobile: October 31 2022 investor relations activities record sheet 36Chongqing Changan Automobile Company Limited 2022 Annual Report Chapter 4 Corporate Governance I. The Basic Situation of Corporate Governance During the reporting period the company continuously improved its corporate governance structure established and improved its internal management and control system and continuously promoted the improvement of the company's standardized operation level in strict accordance with the requirements of the Company Law the Securities Law and the relevant regulatory documents of the China Securities Regulatory Commission and Shenzhen Stock Exchange. The actual situation of corporate governance of the company meets the requirements of the regulatory documents of the China Securities Regulatory Commission on listed company governance.During the reporting period the company improved a series of regulatory management systems such as the Articles of Association the Management System for Connected Transactions the Management System for Information Disclosure the Registration Management System for Insiders the Investor Relations Management System and the Independent Director Work System in accordance with the newly issued regulatory documents of the China Securities Regulatory Commission and the Shenzhen Stock Exchange in combination with the actual situation Continuously optimize the construction of corporate governance related systems and management processes orderly promote implementation and strive to improve the company's decision-making efficiency and governance effectiveness.The company has established an effective internal control system over the financial report. According to company’s operation and management characteristics the company strictly implemented the “Enterprise Accounting Standards” improved the basic accounting management established a sound financial system optimized accounting and statements preparation process strengthened the financial supervision conducted the in-depth implementation of financial management established the management foundation work accounting and finance management authorization the monetary fund management financing purchasing and payment fixed assets projects under construction accounting policy accounting estimate consolidated financial statements cost management inventory management financial analysis and other financial management system to ensure the quality of accounting information and the safety of the Company property. According to internal control deficiencies identified standards of the financial report there is no internal control defects over financial reporting in the report period. The full text of the internal control self-evaluation report is published on http://www.cninfo.com.cn on April 18 2023.Whether there are differences between corporate governance and the related requirements of “Company Law” and China CSRC.□ Yes √ No There is no difference between corporate governance and the related requirements of “Company Law” and China CSRC.II. The Independence of the Company in Terms of Assets Personnel Finance Organization And Business Relative to Controlling Shareholders and Actual Controllers The Company is completely independent from the controlling shareholders and actual controllers in terms of business assets personnel institutions and finance. 1. Business: The business of Changan Auto is independent of controlling shareholders and actual controllers. It makes independent decisions operates independently and is responsible for its own profits and losses. It has a complete business and industrial system including procurement production sales and research and development. The controlling shareholders and actual controllers do not directly or indirectly interfere in the production and business activities of Changan Auto. 2. Personnel: The controlling shareholder and the actual controller are completely independent from the personnel labor and personnel of Changan Auto. They have independent staff teams complete labor management performance appraisal and other systems and salary systems and independently sign the Labor Contract with employees according to law. 3. Assets: The assets of controlling shareholders and actual controllers are strictly separated from Changan Auto and the property rights are clearly defined. There is no direct or indirect interference in the production and operation of Changan Auto. Changan Auto has independent production system auxiliary production system supporting facilities land use rights and other assets legally owns land real estate machinery and equipment trademarks related to production and operation and has an independent raw material procurement and product sales system. 4. Organization: The controlling shareholder the actual controller and Changan Auto have independent production operation and office places. There is no mixed operation. 5. Finance: The controlling shareholder the actual controller and Changan Auto have independent finance and accounting departments with independent finance and accounting personnel and have established independent accounting system and financial management system. They make financial decisions independently open bank accounts and pay taxes independently and do not share bank accounts. Changan Auto handles tax registration independently and pays tax independently according to law.Ⅲ. Competition Situation □ Applicable √ Not applicable 37Chongqing Changan Automobile Company Limited 2022 Annual Report IV. Annual Shareholders Meeting and Extraordinary General Meeting during the Reporting Period 1. Shareholders meeting during the reporting period Investors’ Meeting Session Type participation Opening Time Disclosure Time Resolution Index Ratio http//www.cninfo.com.cn 2022 The First 2022 The First Extraordinary Extraordinary EGM 40.917% March 17th 2022 March 18th 2022 General Meeting Resolution General Meeting Announcement (Announcement Number: 2022-14) 2021 Annual http//www.cninfo.com.cn Shareholders Annual 50.718% June 15th2022 June 16th 2022 2021 Annual Shareholders Meeting Meeting Resolution Announcement (Announcement Number: 2022-44) http//www.cninfo.com.cn 2022 The Second 2021 The Second Extraordinary Extraordinary EGM 40.755% July 26th2022 July 27th 2022 General Meeting Resolution General Meeting Announcement (Announcement Number: 2022-53) http//www.cninfo.com.cn 2022 The Third 2021 The Second Extraordinary Extraordinary EGM 49.838% August 18th2022 August 19th 2022 General Meeting Resolution General Meeting Announcement (Announcement Number: 2022-60) http//www.cninfo.com.cn 2022 The Fourth Extraordinary EGM 39.332% December 22nd December 23th 2021 The Second Extraordinary General Meeting Resolution General Meeting 2022 2022 Announcement (Announcement Number: 2022-82) 2. The shareholders of preferred shares with voting right restored request to convene an extraordinary general meeting □ Applicable √ Not applicable V. Directors Supervisors and Senior Management Personnel 1. Basic information Share Share Shares held volume volume Shares Appoint Start End at beginning increased decreased Other held at the Reasons for Name Position ment Gender Age of reporting in the in the increase/de end of the increase status date date period reporting reporting crease reporting /decrease in(share） period period (share) period shares（share） （share） （share)Chairman Equity Zhu Secretary of Incumbe 2020- 2023- Huarong the Party nt M 57 06-22 06-22 385280 115584 500864 distribution in 2021; Equity Committee incentive Xian Zhigang Director Incumbe 2022- 2023- nt M 52 07-26 06-22 - - - Zhang Bo Director Incumbe 2021- 2023-nt M 44 02-18 06-22 - - - Liu Gang Director Incumbent M 56 2021-2023- 02-1806-22--- Zhou Kaiquan Director Incumbe nt M 50 2021-2023- 09-1706-22--- 38Chongqing Changan Automobile Company Limited 2022 Annual Report Director President Equity Wang Jun and Deputy Incumbent M 50 2020- 2023- 280000 84000 364000 distribution in Party 06-22 06-22 2021; Equity Secretary incentive Director CFO Equity Zhang Secretary of Incumbe 2020- 2023- distribution in Deyong M 48 271600 81480 353080 the Board of nt 06-22 06-22 2021; Equity Directors incentive Ren Xiaochan Independent Incumbe 2020- 2023- g Director nt M 66 06-22 06-22 - - - Wei Independent Incumbe M 54 2020- 2023-Xinjiang Director nt 06-22 06-22 - - - Cao Independent Incumbe 2020- 2023- Xingquan Director nt M 51 06-22 06-22 - - - Yang Independent Incumbe 2021- 2023- Xinmin Director nt M 62 09-17 06-22 - - - Li Independent Incumbe 2022- 2023- Keqiang Director nt M 59 06-15 06-22 - - - Ding Wei Independent IncumbeDirector nt M 62 2022-2023- 06-1506-22--- Tang Independent Incumbe M 60 2022- 2023-Guliang Director nt 06-15 06-22 - - - Zhang Independent Incumbe Ying Director nt M 44 2022-2023- 06-1506-22--- Chairman of Lian Jian the Incumbe 2021- 2023-Supervisory nt M 59 09-17 06-22 - - - Board Sun Dahong Supervisor Incumbe nt M 56 2020-2023- 06-2206-22--- Employee Shi Supervisory Incumbe 2021- 2023- Shengwei Board nt M 51 11-08 06-22 - - - Member Employee Luo Yan Supervisory Incumbe 2020- 2023-Board nt F 48 06-19 06-22 - - - Member Deputy Equity Yuan Secretary of Incumbe M 54 2020- 2023-Mingxue the Party nt 07-13 06-22 280000 84000 364000 distribution in 2021; Equity Committee incentive Pu Secretary of Xingchua Discipline Incumbe M 51 2023- 2023- n Inspection nt 03-03 06-22 --- Commission Tan Executive Equity Incumbe 2020- 2023- distribution in Benhong Vice M 47 President nt 07-13 06-22 271600 81480 353080 2021; Equity incentive Executive Equity Ye Pei Vice Incumbe M 47 2020- 2023-nt 07-13 06-22 271600 81480 353080 distribution in President 2021; Equity incentive Executive Equity Chen Wei Vice Incumbent M 50 2020-2023- 07-1306-2227160081480353080 distribution in President 2021; Equity incentive Li Executive Equity Mingcai Vice Incumbe nt M 41 2022- 2023- distribution in President 01-28 06-22 271600 81480 353080 2021; Equity incentive Yang Executive Incumbe M 48 2022- 2023- 194000 58200 252200 Equity 39Chongqing Changan Automobile Company Limited 2022 Annual Report Dayong Vice nt 12-28 06-22 distribution in President 2021; Equity incentive Executive Equity Peng Tao Vice Incumbe M 45 2022- 2023- 191240 57372 248612 distribution in President nt 12-28 06-22 2021; Equity incentive Equity Zhang Vice Incumbe 2022- 2023- distribution in Xiaoyu President nt M 43 01-12 06-22 191240 57372 248612 2021; Equity incentive Equity Wang Vice Incumbe M 40 2022- 2023-Xiaofei President nt 01-12 06-22 132300 39690 171990 distribution in 2021; Equity incentive Equity Wang Hui Vice IncumbePresident nt M 41 2022-2023- 09-2206-2213230039690171990 distribution in 2021; Equity incentive Equity Zhang Vice Incumbe 2023- 2023- Fatao President nt M 40 01-05 06-22 191240 57372 248612 distribution in 2021; Equity incentive Equity Li Jun Secretary of Incumbe F 53 2020- 2023- 191240 57372 248612 distribution in the Board nt 07-13 06-22 2021; Equity incentive Executive Equity Li Wei Vice Outgoing M 56 2020- 2022- 271600 81480 353080 distribution in President 07-13 01-12 2021; Equity incentive Liu Jipeng Independent Director Outgoing M 66 2020-2022- 06-2206-15--- Li Independent Qingwen Director Outgoing M 67 2020-2022- 06-2206-15--- Chen Independent Quanshi Director Outgoing M 77 2020-2022- 06-2206-15--- Tan Xiaoshen Independent Director Outgoing M 52 2020-2022- g 06-22 06-15 --- Ye Wenhua Director Outgoing M 50 2022-2022- 03-1707-08--- Equity He Independent Chaobing Director Outgoing M 55 2020-2022- 07-1309-2227160081480353080 distribution in 2021; Equity incentive Executive Equity Zhao Fei Vice Outgoing M 48 2020- 2022-07-13 12-02 271600 81480 353080 distribution in President 2021; Equity incentive Secretary of Equity Hua Discipline 2020- 2023- Zhanbiao Inspection Outgoing M 55 07-13 03-03 271600 81480 353080 distribution in 2021; Equity Commission incentive Total -- -- -- -- -- -- 4613240 1383972 5997212 -- Whether there are any outgoing directors and supervisors and the dismissal of senior management personnel during the reporting period √Yes □ No See “V. 1. Changes in Directors Supervisors and Senior Management Personnel” in Chapter 4.Changes in Directors Supervisors and Senior Management Personnel √ Applicable □ Not applicable Name Position Type Date Reason Zhang Xiaoyu Vice President Appointed January 12th 2022 Appointment Wang Xiaofei Vice President Appointed January 12th 2022 Appointment 40Chongqing Changan Automobile Company Limited 2022 Annual Report Li Mingcai Executive Vice President Appointed January 28th 2022 Appointment Zhang Deyong Secretary of the Board Appointed January 28th 2022 Appointment Ye Wenhua Director Elected March 17th 2022 Appointment Li Keqiang Independent Director Elected June 15th 2022 Appointment Ding Wei Independent Director Elected June 15th 2022 Appointment Tang Guliang Independent Director Elected June 15th 2022 Appointment Zhang Ying Independent Director Elected June 15th 2022 Appointment Xian Zhigang Director Elected July 26th 2022 Appointment Wang Hui Vice President Appointed September 22th 2022 Appointment Yang Dayong Executive Vice President Appointed December 28th 2022 Appointment Peng Tao Executive Vice President Appointed December 28th 2022 Appointment Zhang Fatao Vice President Appointed January 5th 2023 Appointment Secretary of Discipline Pu Xingchuan Inspection Commission (Senior Management Appointed March 3rd 2023 Appointment Personnel) Li Wei Executive Vice Dismissal from President Employment January 12th 2022 Job change Li Mingcai Vice President Dismissal from Employment January 28th 2022 Job change Liu Jipeng Independent Director Leave office upon expiration of term June 15th 2022 Leaving office after 6 years of tenure Li Qingwen Independent Director Leave office upon expiration of term June 15th 2022 Leaving office after 6 years of tenure Chen Quanshi Independent Director Leave office upon expiration of term June 15th 2022 Leaving office after 6 years of tenure Tan Xiaosheng Independent Director Leave office upon expiration of term June 15th 2022 Leaving office after 6 years of tenure Ye Wenhua Director Outgoing July 8th 2022 Job change He Chaobing Executive Vice Dismissal from President Employment September 22th 2022 Job change Zhao Fei Executive Vice Dismissal from President Employment December 2nd 2022 Job change Yang Dayong Vice President Dismissal from Employment December 28th 2022 Job change Peng Tao Vice President Dismissal from Employment December 28th 2022 Job change Secretary of Discipline Hua Zhanbiao Inspection Commission Dismissal from (Senior Management Employment March 3rd 2023 Job change Personnel) 2. Incumbency Professional background work experience and duties and responsibilities of incumbent Directors Supervisors and Senior Manager Personnel (1) Directors Mr. Zhu Huarong Chairman and Secretary of the Party Committee. Born in 1965 master's degree senior engineer. Currently he is the General Manager Assistant of Weapon Equipment Group and the Director of Changan China. He has served as Deputy Director of the Technology Department of Changan Company Chief Engineer of the Automobile Manufacturing Plant Assistant to the President and Director of the Technology Center Director of the Science and Technology Committee Deputy General Manager of the Company President of the Engineering Research Institute Vice President and Secretary of the Party Committee of Changan Automobile Deputy 41Chongqing Changan Automobile Company Limited 2022 Annual Report Secretary of the Party Committee of Changan Automobile of China and President of Changan Automobile.Mr. Xian Zhigang Director. Born in 1970 master's degree senior engineer. Currently he is the Director of the Strategic Development Department of the Weapon Equipment Group. He has served as Deputy Factory Director of Precision Machinery Factory of Changan Company Factory Director of Special Machinery Factory of Machine Manufacturing Company Vice President of Changan Company and Senior Vice General Manager of Machine Manufacturing Company Deputy General Manager Deputy Secretary of the Party Committee General Manager Chairman and Secretary of the Party Committee of Changan Industry Chairman Secretary of the Party Committee General Manager and Deputy Secretary of the Party Committee of Chongqing Wangjiang Industry Co. Ltd. and Director of the Safety and Environmental Protection Department of Ordnance Equipment Group.Mr. Zhang Bo Director. Born in 1978 master's degree senior accountant. Currently he is the Director of the Finance Department of the Weapon Equipment Group. He has served as Deputy Director of the Finance Department (Comprehensive Department) Deputy Director of the Finance Department and Researcher of the Weapon Equipment Group Director and Chief Accountant of Chongqing Wangjiang Industry Co. Ltd. and Deputy Director of the Finance Department of the Weapon Equipment Group.Mr. Liu Gang Director. Born in 1966 with a bachelor's degree he is a senior engineer. Currently he is the Deputy Chief Engineer of the Weapon Equipment Group. He has served as the Deputy Director and Director of the Scientific Research Division of the 58th Research Institute of China's Weapon Industry the Deputy Director and Director of the 58th Research Institute of China's Weapon Industry the Deputy Director of the Southwest Regional Department of the Weapon Equipment Group the Deputy President of the China Weapon Equipment Research Institute the Director of the Science and Technology Quality Department (Information Department) the Director of the Science and Technology and Information Department and the Director of the Science and Technology Quality Network Information Department of the Weapon Equipment Group.Mr. Zhou Kaiquan Director. Born in 1973 master's degree senior engineer. Currently he is the Chairman and Secretary of the Party Committee of Changan China. He has served as the Chairman of Chengdu Qingshan Automobile Trade and Sales Company the Deputy General Manager Director General Manager and Deputy Secretary of the Party Committee of Chongqing Qingshan Industry Co. Ltd. the Director and General Manager of Sichuan Ningjiang Shanchuan Machinery Co. Ltd. the Director and General Manager of Sichuan Ningjiang Precision Industry Co. Ltd. the Chairman Secretary of the Party Committee and General Manager of Southwest Weapons Co. Ltd. and the Deputy General Manager General Manager Deputy Secretary of the Party Committee Vice Chairman Secretary of the Party Committee and President of Changan China.Mr. Wang Jun Director President and Deputy Secretary of the Party Committee. Born in 1972 master's degree senior engineer.He has served as Vice President of the Automotive Engineering Research Institute and Director of the Product Planning Division of Changan Company Manager of the Product Management Division of the Marketing Department of the Sales Co. Ltd. Director Vice Minister and Director of the Product Planning Division of the Marketing Department of the Sales Co. Ltd. Assistant to the President of Changan Automobile and General Manager of the Sales Co. Ltd. Secretary of the Party Committee Vice General Manager and General Manager of the Commercial Vehicle Business Unit Executive Vice President of Changan Automobile Management Representative of the Integration of Industrialization and Urbanization Chairman of the Labor Union and President of Changan Automobile University.Mr. Zhang Deyong Director Chief Accountant Secretary of the Board of Directors. Born in 1975 Master of Accounting (MPAcc) Senior Accountant. He has served as the Deputy Director Director and Assistant Director of the Finance Department of the Automation Research Institute of the Weapon Equipment Group the Deputy Director of the Finance Department of the Weapon Equipment Group (on a temporary basis) the Director Chief Accountant and Member of the Party Committee of Chongqing Changjiang Electric Co.Ltd. the Deputy Director of the Finance Department of the Weapon Equipment Group (on a temporary basis) the Director Chief Accountant and Member of the Party Committee of Changan Industry and the Executive Vice President of Changan Automobile.Mr. Ren Xiaochang independent director. Born in 1956 with a bachelor's degree. Currently he is a member of the Second National Expert Advisory Committee on the Development of Strategic Emerging Industries an expert in the high-tech expert group of China International Engineering Consulting Corporation a science and technology expert in the Chinese machinery industry an expert on special allowances from the State Council and an expert on the evaluation of the National Science and Technology Award; He is also an independent director of Lifan Technology (601777) Chongqing Electromechanical (02722) and Zongshen Power (001696). The science and technology projects he is leading and participating in have won three second and third prizes of the provincial and ministerial level science and technology progress awards. He served as Chairman and General Manager (President) of China Automotive Engineering Research Institute Co. Ltd.Mr. Wei Xinjiang independent director. Born in 1969 Ph.D. researcher. Currently he is the Deputy General Manager of the Development Planning Department of China Life Pension Insurance Co. Ltd. a senior researcher at the China Life Financial Research Institute and an arbitrator at the Shenzhen International Arbitration Court; He is also a part-time professor and postgraduate supervisor at the School of Finance and Finance of Renmin University of China the School of International Business and Economics of the University of International Business and Economics and the Netherlands Business School. He is good at international business operations overseas mergers and acquisitions capital market operations etc. He has rich research in finance insurance overseas investment comprehensive finance and other fields. He has published nearly 160 papers and 8 monographs in important international and domestic journals. He has been engaged in teaching and research for 13 years in the Department of International Investment at the China University of Finance and the School of Finance at the University of International Business and Economics.Mr. Cao Xingquan independent director. Born in 1971 Doctor of Laws. Currently he is a professor at the School of Civil and Commercial Law of Southwest University of Political Science and Law and a doctoral supervisor in the field of civil and commercial law and commercial law; He also serves as the executive director of the Research Societies of Commercial Law and Insurance Law of the Chinese Law Society and as an arbitrator of arbitration institutions in Chongqing Zunyi and other places. He has 21 years of teaching and research experience in civil and commercial law including 18 years of teaching at Southwest University of Political Science and Law focusing on research in commercial law company law securities law and insurance law. He has presided over or participated in more than 20 scientific research projects published more than 60 legal academic papers and published academic works and participated in the compilation of more than 10 teaching materials. He once served as Deputy Chief Judge of the Fourth Civil Trial 42Chongqing Changan Automobile Company Limited 2022 Annual Report Division of the First Intermediate People's Court of Chongqing and a member of the Civil Administrative Procuratorial Expert Committee of the Chongqing People's Procuratorate.Mr. Yang Xinmin independent director. Born in 1960 Ph.D. Currently he is a professor at the School of Mathematical Sciences of Chongqing Normal University the supervisor of the China Operations Research Society the vice chairman of the China Industrial and Applied Mathematics Association the director of the Chongqing National Applied Mathematics Center and the deputy director of the National Tianyuan Mathematics Southwest Center. Mainly engaged in systematic research in the field of operations research (mathematics). In 2012 he was awarded the National Excellent Scientific and Technological Worker in 2014 he was awarded the National Outstanding Professional and Technical Talent and in 2016 he was elected an academician of the International Academy of Systems and Control Sciences. He has presided over more than 10 National Natural Science Foundation projects including 1 major project 2 key projects and 1 international (regional) project. He has won the second prize of the National Natural Science Award the first prize of the Ministry of Education's Natural Science Award and the highest science and technology outstanding contribution award in Chongqing. He has served as Vice President of the Chinese Mathematical Society Vice President of the Chinese Operational Research Society and Vice President of the Chinese Society of Systems Engineering.Mr. Li Keqiang independent director. Born in 1963 Ph.D. in automotive engineering. He is currently a professor and doctoral supervisor of the School of Vehicle and Transportation of Tsinghua University director of the State Key Laboratory of Automotive Safety and Energy Conservation (Tsinghua University) and an academician of the CAE Member; He also serves as an independent director of Yutong Bus (600666) Siwei Tuxin (002405) China Auto Research (601965) and Gaohong Co. Ltd. (000851). He was the dean of the Department of Automotive Engineering at Tsinghua University.Mr. Ding Wei is an independent director. Born in 1960 Bachelor of Finance. Currently he is the founder and chairman of Xiamen Borun Capital Investment Management Co. Ltd; He is also an independent director of Guotai Jun'an (601211) and Hengsheng Electronics (600570). He has accumulated rich experience and network resources in the fields of macroeconomic commercial banking investment banking and private equity investment. He has served as an economist and department head of the World Bank and the International Monetary Fund President of Deutsche Bank in China Chairman of the Investment Banking Management Committee and Head of the Investment Banking Department of China International Finance Corporation Member of the Global Senior Management Committee of Temasek Member of the Global Investment Decision Committee President of China President and Chairman of CICC Capital Operations Co. Ltd Independent non-executive director of Shenzhou Car Rental Co. Ltd.Mr. Tang Guliang independent director. Born in 1962 Doctor of Finance. Currently he is a professor of finance at the International Business School of the University of International Business and Economics; He also serves as an independent director of Guangfeng Technology (688007) and Fosun Pharmaceutical (600196). He is mainly engaged in the teaching and research of management accounting and financial management and has made unique and influential achievements in budget management group control performance evaluation financial strategy capital operation and other aspects. Currently he has published 4 monographs and 40 books and over 120 papers in high-end academic journals such as Accounting Review TAR and Management World. He has served as an independent director of Jiangsu Wuzhong (600200) China Satellite (600118) Seagull Sanitary Ware (002084) Oceanwide Holdings (000046) Minmetals Development (600058) Changjiang Securities (000783) and other companies. Mr. Zhang Ying independent director. Born in 1978 with a PhD in management. Currently he is a Distinguished Professor of Boya at Peking University Deputy Dean of Guanghua School of Management Director of the Peking University Management Case Study Center and Senior Researcher of the China Management Research Center at Cambridge University in the United Kingdom; He is also an independent director of China Film (600977). Research focuses on the intersection of psychology and economics specializing in using experimental and data methods to study how individual behavioral decisions and social attitudes affect corporate strategy and policy making. Awarded the Outstanding Young Scholar Award of the American Academy of Marketing Sciences and the "Global Top Marketing Scholar" Award of the American Marketing Association. He has been selected as one of the National Youth Top Talents of the Organization Department of the Central Committee of the Communist Party of China awarded the National Natural Science Foundation for Distinguished Young Scholars and won the "Four First Batch" talent of the Propaganda Department of the Central Committee of the Communist Party of China. He once taught at the University of Texas and served as an independent director of Dashang Shares (600694). 2. Supervisors Mr. Lian Jian Chairman of the Supervisory Board. Born in 1963 master's degree senior engineer. Currently he is a senior professional in the Southwest Regional Department of Weapon Equipment Group. He has served as Deputy Director Deputy Chief Engineer Chief Engineer Factory Director Deputy Secretary of the Party Committee Secretary of the Party Committee General Manager and Vice Chairman of the Technology Department of Sichuan Changqing Machinery Factory Director Secretary of the Party Committee and Chairman of the Labor Union of Chongqing Hongyu Precision Industry Co. Ltd. Deputy Secretary of the Party Committee and Secretary of the Discipline Inspection Commission of the Southwest Regional Department of the Weapon Equipment Group Deputy Secretary of the Party Committee Secretary of the Discipline Inspection Commission and Senior Special Agent of the Southwest Regional Department (Motorcycle Department) of the Weapon Equipment Group Chairman and Secretary of the Party Committee of Chongqing Huxi Electric Machinery Industry Co. Ltd. Senior Executive of the Southwest Division of the Weapon Equipment Group.Mr. Sun Dahong Supervisor. Born in 1966 master's degree senior economist. Currently he is the Deputy Director and Senior Professional of the Audit Risk Control and Legal Department of the Weapon Equipment Group. He has served as the Deputy Director of the Legal Department of the General Office of the Weapon Equipment Group the Deputy Director and Director of the Legal Advisory Office the Director of the Legal Affairs Department the Director of the Security and Confidentiality Bureau the Deputy Director of the Office and the Deputy Director of the Legal Department.Mr. Shi Shengwei Employee Supervisor. Born in 1971 bachelor’s degree political engineer. Currently he is the Discipline Inspection Officer of the Supervision Division of Changan Automobile Discipline Inspection Department. He has served as a workshop group and machining worker in Changan Company a mechanic in the first machining section of the Engine Branch a publicity officer and office director of the Party-Masses Studio of the Comprehensive Management Division of the Fourth Factory a director of the 43Chongqing Changan Automobile Company Limited 2022 Annual Report Party-Masses Studio of the Comprehensive Management Division of Changan Automobile Jiangbei Engine Factory a discipline inspection and supervision officer of the Discipline Inspection Division of the Discipline Inspection and Supervision Department and a manager of the Changan Mazda Integrity Employment Office.Ms. Luo Yan employee supervisor. Born in 1974 bachelor’s degree assistant economist. Currently he is the director of the Jiangbei Branch of the Shared Service Center of Changan Automobile Human Resources Department. He has served as a maintenance electrician engineering surveyor labor technology quota officer and planner in Workshop 232 of the Third Factory of Changan Company as well as the director of the Employee Welfare Office of the Salary Management Office of the Human Resources Department of Changan Automobile and the director of the Third Office of Salary and Welfare Management. 3. Senior Management other than Directors and Supervisors Mr. Yuan Mingxue Deputy Secretary of the Party Committee Chairman of the Labor Union and Director of the Changan Learning Center. Born in 1968 master's degree senior engineer. He has served as Deputy Director and Minister of the Quality Department of Changan Company General Manager and Secretary of the Party Committee of Nanjing Changan Automobile Co. Ltd.Assistant to the President of Changan Automobile Co. Ltd. Executive Vice President of Jiangling Holding Co. Ltd. Director of the Strategic Planning Department Secretary of the Party Branch Director of the Capital Operation Department of Changan Automobile Co. Ltd. General Manager and Secretary of the Party Branch of the Overseas Business Development Department Vice President and Executive Vice President of Changan Automobile Co. Ltd.Mr. Pu Xingchuan Secretary of the Discipline Inspection Commission. Born in 1971 master's degree senior economist. He has served as Deputy Secretary of the Party Committee Secretary of the Discipline Inspection Commission and Chairman of the Labor Union of Chongqing Qingshan Industry Co. Ltd. Director of the Office of the Southwest Military Industry Bureau Secretary of the Party Committee Secretary of the Discipline Inspection Commission and Chairman of the Labor Union of Southwest Ordnance Industry Co. Ltd. Director General Manager and Deputy Secretary of the Party Committee of Wanyou Automobile Investment Co.Ltd. and Chairman and Secretary of the Party Committee of Southwest Ordnance Industry Co. Ltd.Mr. Tan Benhong Executive Vice President CEO of Avatr Technology (Chongqing) Co. Ltd. Born in 1975 master's degree engineer. He has served as the Director of the Technical Planning Research Institute of the Automobile Engineering Research Institute of Changan Company the Deputy Chief Engineer and Director of the Technical Planning Research Institute of the Automobile Engineering Research Institute the Vice President of the Changan Automobile Engineering Research Institute the President of the Beijing Research Institute the Director of the Marketing Department the Director of the Brand Public Relations Department the Director of the Product Planning Department the Executive Vice President of the Changan Automobile Research Institute the Secretary of the Party Committee the Company's Press Spokesperson and the General Manager of the Design Institute.Mr. Ye Pei Executive Vice President Director of Passenger Car Operation Management Committee and Director of Auchan Operation Management Committee. Born in 1975 master's degree engineer. He has served as Assistant General Manager of Nanjing Changan Deputy Director of the Quality Department of Changan Automobile Deputy Director of the Company's Office General Manager and Secretary of the Party Committee of Nanjing Changan Automobile Deputy General Manager of the Commercial Vehicle Business Unit Assistant President of the Company Director of the Strategic Planning Department Secretary of the Party Branch General Manager and Secretary of the Party Committee of the Car Sales Business Unit General Manager and Secretary of the Party Committee of the Passenger Vehicle Marketing Business Unit and Vice President of Changan Automobile.Mr. Chen Wei Executive Vice President General Counsel of the Company Deputy Director of Passenger Car Operation Management Committee and Deputy Director of Auchan Operation Management Committee. Born in 1972 bachelor's degree political engineer. He has served as Deputy Factory Director Factory Director and Secretary of the Party Committee of Changan Automobile Manufacturing Factory Vice President of Personnel and Secretary of the Discipline Inspection Commission of Changan Ford Director of the Logistics Department of Changan Automobile Manufacturing Secretary of the Party Branch and OTD Project Director of the company General Manager and Secretary of the Party Committee of Beijing Changan Automobile Company Director of the Construction Project of Beijing Research Institute Secretary of the Party Committee of Chongqing Lingyao Automobile Co. Ltd. and Vice President of Changan Automobile.Mr. Li Mingcai Executive Vice President and Management Representative of the Integration of Industrialization and Urbanization.Born in 1981 with a master's degree. He has served as General Manager Assistant and Sales Regional Manager of Changan Automobile's Overseas Business Development Department Deputy General Manager of Overseas Business Development Department General Manager of International Companies Executive Deputy General Manager of Overseas Business Development Department Project Director of Russian JV Manager of Brazil Project Team General Manager of Overseas Business Department and Vice President of Changan Automobile.Mr. Yang Dayong Executive Vice President Executive Vice President of Changan Ford and Secretary of the Party Committee.Born in 1974 bachelor’s degree. He has served as Vice Minister of Changan Automobile Marketing Department Vice Minister and Minister of Commercial Vehicle Business Management Department Director of Brand Public Relations Department Secretary of Party Branch Company Press Spokesperson Senior Project Director of High-end Vehicle Brand Project Team Senior Project Director of Intelligent Industry Development Project Team General Manager and Secretary of Party Committee of Changan New Energy and Vice President of Changan Automobile.Mr. Peng Tao Executive Vice President Director of the Light Vehicle Operations Management Committee. Born in 1978 bachelor’s degree senior engineer. He has served as Vice Minister Executive Vice General Manager and Secretary of the Party Branch of Changan Automobile Product Planning Department Executive Vice General Manager General Manager and Secretary of the Party Committee of the Passenger Vehicle Marketing Division and Vice President of Changan Automobile.Mr. Zhang Xiaoyu Vice President General Manager of Changan Prospective Technology Research Institute Chairman of the Association for Science and Technology of the Company and Director of the National Key Laboratory of Intelligent Vehicle Safety Technology. Born in 1979 Ph.D. senior engineer. He has served as the Deputy General Manager and General Manager of the British R&D Center of Changan Automotive Power Research Institute the Deputy General Manager of the Power Research Institute the Company's H13T Project Director the NE Series Powertrain Project Director the General Manager of the Power Research Institute 44Chongqing Changan Automobile Company Limited 2022 Annual Report and the General Manager of the Second Product Development Department.Mr. Wang Xiaofei Vice President. Born in 1982 bachelor’s degree engineer. He used to be the Deputy Director of the Product Department of Changan Commercial Vehicle Business Unit the Deputy Director of the Product Department of Auchan Automotive Business Unit the Deputy General Manager and Product Marketing Director of Passenger Vehicle Marketing Business Unit the Deputy General Manager of Product Planning Department and the General Manager of Auchan Automotive Business Unit.Mr. Wang Hui Vice President. Born in 1981 bachelor’s degree engineer. He has served as the director of the new business coordination project team of Changan Automobile the company's office director and party branch secretary the executive vice president and party committee secretary of Changan Mazda Engine the person in charge of the new energy cooperation project of Changan Mazda the executive vice president and party committee secretary of Changan Mazda and the general manager of the overseas business development department.Mr. Zhang Fatao Vice President and Director of Safety Production of the Company. Born in 1982 bachelor’s degree assistant engineer. He has served as Deputy Director of the Office of Changan Automobile Company General Manager of the Technology and Project Management Department Secretary of the Party Branch Executive Vice Chairman of the Association for Science and Technology PDS Project Director Director of the Company's Office Secretary of the Party Branch Director of the Party Committee Office Director of the Board Office General Manager of the Human Resources Department Director of the Party Committee Organization Department and Director of the Talent Management Department of Changan Learning Center.Ms. Li Jun Secretary of the Board of Directors and Senior Expert of the Board Office. Born in 1969 Master of Business Administration Senior Accountant. He has served as the Deputy Director and Director of the Securities Division of the Finance Department of Changan Automobile the Director of the Capital Operations Division of the Finance Department the Director of the Board of Directors Office the Deputy Director of the Finance Department and the Deputy General Manager of the Capital Operations Department.Employment in shareholders’ work unit √Applicable □ Not applicable Whether having Name Name of shareholders’ work Position in shareholders’ work Term start Term end renumeration or unit unit date date allowance in shareholders’ work unit China South Industries Group Assistant General Manager of Zhu Huarong Co. Ltd. and China Changan China South Industries Group Co. N Automobile Group Co. Ltd. Ltd. and the director of China Changan Xian Zhigang China South Industries Group Director of the Strategic Co. Ltd. Development Department Y Zhang Bo China South Industries Group Co. Ltd. Director of Finance Department Y Liu Gang China South Industries Group Co. Ltd. Vice Chief Engineer of CSG Y Zhou Kaiquan China Changan Automobile Chairman and Secretary of the Group Co. Ltd Party Committee Y Lian Jian China South Industries Group Senior Professional of Southwest Co. Ltd. Regional Department Y Deputy Director and Senior Sun Dahong China South Industries Group Co. Ltd. Executive of Audit Risk Control Y and Legal Department Position in other work unit None Employment status in other units √Applicable □ is not applicable Name Name of other Term Whether get work units Position in other work units start Term allowance in date end date other work unit China Life Deputy General Manager of Development Planning Wei Xinjiang Insurance Co. Department of China Life Insurance Co. Ltd. Senior Y Ltd. Researcher of China Life Financial Research Institute Southwest University of Professor of the School of Civil and Commercial Law of Cao Xingquan Political Science Southwest University of Political Science and Law and a Y & Law doctoral tutor in the direction of civil and commercial law Chongqing Professor of the School of Mathematical Sciences of Yang Xinmin Normal Chongqing Normal University Chairman of the China University Association for Operational Research Vice Chairman of Y the China Association for Industry and Applied 45Chongqing Changan Automobile Company Limited 2022 Annual Report Mathematics Director of the Chongqing National Center for Applied Mathematics Vice Director of the National Tianyuan Mathematics Southwest Center the first batch of members of the China Association for Industry and Applied Mathematics and members of the China Association for Operational Research Professor and doctoral supervisor of the School of Vehicle Li Keqiang Tsinghua and Transportation of Tsinghua University director of the University State Key Laboratory of Automotive Safety and Energy Y Conservation (Tsinghua University) Xiamen Borun Capital Ding Wei Investment Founder and Chairman of Xiamen Borun Capital Management Co. Investment Management Co. Ltd.Y Ltd Professor Department of Finance International Business University of School University of International Business and International Economics contributing editor and reviewer of Tang Guliang Business and "Accounting Research" deputy editor of "China Y Economics Management Accounting" management accounting consulting expert from the Ministry of Finance member of the CIMA Research Committee in the United Kingdom Distinguished Professor Boya of Peking University Vice Dean of Guanghua School of Management Director of Peking University Management Case Study Center Senior Zhang Ying Peking University Researcher of China Management Research Center at Y Cambridge University UK Professional Editor in Chief of Chinese Journal of Management Science and Executive Vice Editor of Chinese Journal of Marketing Science Position in other work unit None Securities regulator’s punishment to the current and former directors supervisors and senior management during the reporting period in recent three years.□ Applicable √ Not applicable 3. Remuneration of directors supervisors and senior management personnel Decision-making process basis the actual payment of remuneration for directors supervisors and senior management personnel Decision-making process: the annual remuneration of the company's directors supervisors and senior executives except for independent directors is issued in accordance with the relevant remuneration management regulations and standards of the company and based on the achievement of performance targets submitted to the company's board of directors for approval before distribution.The basis: the senior management evaluation is divided into annual appraisal and term assessment. The salary of employee supervisors shall be paid by position in accordance with the company's salary system. Payment of company independent directors is prescribed by the board of directors and submitted to the board of directors of the company and approved by the shareholders' general meeting.Actual payments: Since June 2022 Mr. Li Keqiang an independent director has voluntarily waived receiving allowances and other independent directors are paid according to the allowance standards. In 2022 directors supervisors and senior executives who receive remuneration from the company had a total of RMB 29.1927 million yuan in remuneration payable.Remuneration of Directors Supervisors and Senior Management Personnel during the reporting period Unit: RMB Total pre-tax Whether Name Position Gender Age Office status remuneration from remunerated by the Company related-parties of the company Chairman Secretary Zhu Huarong of the Party M 57 Incumbent 2509457 N Committee Xian Zhigang Director M 52 Incumbent Y Zhang Bo Director M 44 Incumbent Y Liu Gang Director M 56 Incumbent Y Zhou Kaiquan Director M 50 Incumbent Y Wang Jun Director President Deputy Secretary of M 50 Incumbent 2492281 N 46Chongqing Changan Automobile Company Limited 2022 Annual Report the Party Committee Director Chief Zhang Deyong accountant Secretary M 48 Incumbent 1995683 N of BOD Ren Xiaochang Independent Director M 66 Incumbent 120000 N Wei Xinjiang Independent Director M 54 Incumbent 120000 N Cao Xingquan Independent Director M 51 Incumbent 120000 N Yang Xinmin Independent Director M 62 Incumbent 120000 N Li Keqiang Independent Director M 59 Incumbent N Ding Wei Independent Director M 62 Incumbent 60000 N Tang Guliang Independent Director M 60 Incumbent 60000 N Zhang Ying Independent Director M 44 Incumbent 60000 N Lian Jian Chairman of the Board of Supervisors M 59 Incumbent Y Sun Dahong Supervisor M 56 Incumbent Y Shi Shengwei Employee Supervisor M 51 Incumbent 309463 Y Luo Yan Employee Supervisor F 48 Incumbent 337687 N Yuan Mingxue Deputy Secretary of the Party Committee M 53 Incumbent 2129659 N Tan Benhong Executive Vice President M 47 Incumbent 1988446 N Ye Pei Executive Vice President M 47 Incumbent 2046423 N Chen Wei Executive Vice President M 50 Incumbent 2125206 N Li Mingcai Executive Vice President M 41 Incumbent 1989156 N Yang Dayong Executive Vice President M 48 Incumbent 1165307 N Peng Tao Executive Vice President M 45 Incumbent 1148900 N Zhang Xiaoyu Vice President M 43 Incumbent 605968 N Wang Xiaofei Vice President M 40 Incumbent 605968 N Wang Hui Vice President M 41 Incumbent 110176 N Li Jun Secretary of the Incumbent BOD F 53 874540 N Li Wei Executive Vice President M 56 Outgoing N Liu Jipeng Independent Director M 66 Outgoing 60000 N Li Qingwen Independent Director M 67 Outgoing 60000 N Chen Quanshi Independent Director M 77 Outgoing 60000 N Tan Xiaosheng Independent Director M 52 Outgoing 60000 N Ye Wenhua Director M 50 Outgoing Y He Chaobing Executive Vice President M 55 Outgoing 1941342 N Zhao Fei Executive Vice President M 48 Outgoing 1873027 N Hua Zhanbiao Secretary for Discipline Inspection M 55 Outgoing 2044038 N Total -- -- -- -- 29192727 -- VI. Performance of Directors during the reporting period 1. Board of Directors in the reporting period Meeting Date of convening Disclosure date Meeting resolution 47Chongqing Changan Automobile Company Limited 2022 Annual Report The 32nd meeting of the 8th Session of Board of Directors January 12 2022 January 13 2022 Please refer to the Resolution of the 32th Meeting of the 8th Board of Directors (No: Announcement 2022-02) The 33rd meeting of the 8th Session of Board of Directors January 18 2022 January 19 2022 Please refer to the resolution of the 33th Meeting of the 8th Board of Directors (Announcement No: 2022-05) The 34th meeting of the 8th Session Please refer to the Resolution of the 34th Meeting of the of Board of Directors January 28 2022 February 8 2022 8th Board of Directors (Announcement No: 2022-07) The 35th meeting of the 8th Session February 21 2022 February 23 2022 Please refer to the Resolution of the 35th Meeting of the of Board of Directors 8th Board of Directors (Announcement No: 2022-09) The 36th meeting of the 8th Session of Board of Directors March 2 2022 No disclosable matters involved The 37th meeting of the8th Session of Board of Directors March 21 2022 No disclosable matters involved The 38th meeting of the 8th Session of Board of Directors April 26 2022 April 28 2022 Please refer to the Resolution of the 38th Meeting of the 8th Board of Directors (Announcement No: 2022-18) The 39th meeting of the 8th Session of Board of Directors April 28 2022 April 292022 Please refer to the Resolution of the 39th Meeting of the 8th Board of Directors (Announcement No: 2022-26) The 40th meeting of the 8th Session Please refer to the Resolution of the 40th Meeting of the of Board of Directors May 20 2022 May 212022 8th Board of Directors (Announcement No: 2022-32) The 41st meeting of the 8th Session of Board of Directors June 2 2022 No disclosable matters involved The 42nd Meeting of the 8th Session Please refer to the Resolution of the 42th Meeting of the of Board of Directors July 8 2022 July 9 2022 Eighth Board of Directors (Announcement No.: 2022- 47) The 43rd meeting of the 8th Session of Board of Directors August 22022 August 3 2022 Please refer to the Resolution of the 43st Meeting of the 8th Board of Directors (Announcement No: 2022-54) The 44th meeting of the 8th Session August 30 2022 August 312022 Please refer to the Resolution of the 44th Meeting of the of Board of Directors 8th Board of Directors (Announcement No: 2022-64) The 45th meeting of the 8th Session September of Board of Directors 222022 September 232022 Please refer to the Resolution of the 45rd Meeting of the 8th Board of Directors (Announcement No: 2022-68) The 46th meeting of the 8th Session September 29 of Board of Directors 2022 No disclosable matters involved The 47th meeting of the 8th Session of Board of Directors October 18 2022 No disclosable matters involved The 48th meeting of the 8th Session October 28 2022 October 312022 Please refer to the Resolution of the 48rd Meeting of the of Board of Directors 8th Board of Directors (Announcement No: 2022-71) The 49th meeting of the 8th Session December 2 2022 December 3 2022 Please refer to the Resolution of the 49rd Meeting of the of Board of Directors 8th Board of Directors (Announcement No: 2022-77) The 50th meeting of the 8th Session December 28 of Board of Directors 2022 December 29 2022 Please refer to the Resolution of the 50th Meeting of the 8th Board of Directors (Announcement No: 2022-83) 2. Attendance of directors at the board of directors and shareholders’ meeting Attendance at BOD meetings and shareholders' meeting Number of BOD meetings that Number of Absent from Attendance by Name should be BOD meeting Attendance meetings for Attendance at attendance at means of by proxy Absence two shareholders’ attended in this spot communication consecutive meetings reporting period times Zhu Huarong 19 2 17 0 NO 5 Xian Zhigang 8 0 7 1 NO 0 Zhang Bo 19 1 17 1 NO 2 Liu Gang 19 2 17 0 NO 4 Ye Wenhua 5 0 4 1 NO 0 Zhou Kaiquan 19 0 17 2 NO 1 Wang Jun 19 1 17 1 NO 3 Zhang Deyong 19 2 17 0 NO 4 Liu Jipeng 10 1 9 0 NO 0 48Chongqing Changan Automobile Company Limited 2022 Annual Report Li Qingwen 10 1 9 0 NO 0 Chen Quanshi 10 1 9 0 NO 0 Ren Xiaochang 19 2 17 0 NO 4 Tan Xiaosheng 10 1 9 0 NO 0 Wei Xinjiang 19 2 17 0 NO 4 Cao Xingquan 19 2 17 0 NO 4 Yang Xinmin 19 2 17 0 NO 4 Li Keqiang 9 1 8 0 NO 2 Ding Wei 9 1 8 0 NO 1 Tang Guliang 9 1 8 0 NO 3 Zhang Ying 9 0 8 1 NO 3 Explanation of the members of the Board who failed to attend Board meetings in person for two consecutive times Not applicable 3. The directors’ objections to the relevant matters of the company Disagreement of the directors on matters related to the Company □Yes √ No During the reporting period the directors did not raise objections to the relevant matters of the company. 4. Other statement of the directors performance of duties Whether the directors' suggestions on the company are adopted √Yes □ No Description of the directors on the adoption or non-adoption of relevant suggestions of the company During the reporting period the directors of the company performed their duties and obligations diligently and conscientiously in strict accordance with the relevant provisions of the Company Law and the Articles of Association actively attended the board of directors and shareholders' general meetings carefully deliberated various proposals and put forward valuable professional opinions on the company's system improvement and daily business decision-making effectively improving the company's standardized operation and scientific decision-making level. In addition the independent directors of the company have issued independent and impartial independent opinions on matters such as the company's nomination of directors the appointment of senior management the annual profit distribution the self-evaluation report of internal control the annual daily related party transaction estimate the deposit and use of raised funds and the restricted stock incentive plan which effectively protects the legitimate rights and interests of the company and the majority of investors especially small and medium-sized investors and the company actively listens to and adopts the reasonable suggestions put forward by the directors.VII. Duty Performance of Specialized Committees of the Board of Directors during the Report Period Important Number comments Other Specific Committee of Date of and Members Meeting content performance objection name meetings convening suggestions of duties (if any) held that are made Internal audit work plan for 2022; All the March Report on Audit and Inspection Work in motions Liu Jipeng 2nd 2022 the Fourth Quarter of 2021 were passed Wei Audit unanimously Xinjiang 4 Committee Zhang Financial and accounting statements All the April Deyong prepared by the company motions 19th were passed 2022 unanimously 49Chongqing Changan Automobile Company Limited 2022 Annual Report Financial statements for 2021 (after All the April audit); 2021 Annual Audit Results and motions 26th Communication Report on Important were passed 2022 Matters unanimously 2021 Annual Internal Control Audit Report; Proposal for self-evaluation report on internal control in 2021; All the March Proposal on the appointment of auditors motions 2nd 2022 for the 2022 financial report and were passed internal control report; Work plan for unanimously the second quarter of 2022 and internal audit report for the first quarter Report on Audit Work for the Half Year All the September of 2022 motions 2nd 2022 were passed Tang unanimously Guliang Report on audit work in the third quarter All the October Wei of 2022; Report on Adjusting Audit motions 3 28th Xinjiang Fees for 2022 Financial Report were passed 2022 Zhang unanimously Deyong 2022 Overall Audit Plan and Relevant All the December Audit Requirements motions 30th were passed 2022 unanimously Compensation Zhang Proposal on Adjusting the Repurchase All the and Ying Wei August Price of the A-share Restricted Stock motions Assessment Xinjiang 2nd 2022 Incentive Plan and Repurchase and were passed Committee Ding Wei Cancellation of Some Restricted Stocks unanimously Proposal on Jointly Establishing All the January Chongqing Changan Venture Private motions 12nd Equity Investment Fund Partnership were passed 2022 (Limited Partnership) (Tentative Name) unanimously Proposal on Capital Increase and Share All the January Expansion of Associated Enterprises motions 18th through Public Listing were passed 2022 unanimously Proposal on Investment Plan for 2022; Proposal on the 2022 financing plan; All the February Proposal on developing bill pool motions 21st 2022 business; Proposal on the Company and were passed Zhu its subsidiaries to carry out forward unanimously The Strategic Huarong foreign exchange transactions and Wang Jun 7 Investment Description of financial final accounts All the Ren April Committee for 2021 and financial budget for 2022; motions Xiaochang 26th Proposal on Adjusting and Changing were passed 2022 the Use of Some Raised Funds unanimously Proposal on Disposal of Equipment and All the April Assets in Dashiba and Tea Garden motions 28th Plants were passed 2022 unanimously Proposal on signing a "Financial Service Agreement" with Ordnance All the Equipment Group Finance Co. Ltd; May 20th motions Proposal on Signing a Financial Service 2022 were passed Agreement with Changan Automobile unanimously Finance Co. Ltd; Proposal on Asset Disposal and Signing of Collection and 50Chongqing Changan Automobile Company Limited 2022 Annual Report Storage Agreement in Tea Garden Plant Area Proposal on Investment in Yubei All the July 8th Factory Replacement and Green motions 2022 Intelligent Upgrade Construction were passed Project unanimously Proposal on Increasing Capital to All the August Associated Enterprises motions 2nd 2022 were passed Zhu unanimously Huarong Proposal on Joint-stock Establishment All the Zhang Bo September of Intelligent Driving Company motions Wang Jun 3 22nd were passed Ren 2022 unanimously Xiaochang Li Keqiang Proposal on Acquisition of Partial All the December Equity of Changan New Energy motions 2nd 2022 were passed unanimously VIII. The work of the board of supervisors Whether the company was at risk during the report period according to the supervision of the board of supervisors □Yes √ No The Board of Supervisors supervised and inspected the legal compliance of the company's financial situation measurement of managing major affairs of the company operation and management activities and the implementation of major strategies. The Board of Supervisors has no objection to the supervision matters during the reporting period.IX. The Employees of the Company 1. The number of employees professional field and education level Number of incumbent employees in the parent company 31223 Number of incumbent employees in major subsidiaries 11671 Total number of incumbent employees 42894 Total number of incumbent salaried employees 42894 Number of retired employees for whom parent company and major subsidiary bear the costs 2901 Professional composition Professional fields Number Production 27115 Sales 2002 Technology 9464 Finance 483 Administration 545 Management 3285 Total 42894 Educational Background Degree Number PhD 113 Postgraduate 2573 Bachelor 12470 Junior college 11200 Technical secondary school and high school 14730 Middle school and below 1808 Total 42894 2. Compensation policy The company actively deepens the reform of the distribution system continuously optimizes and improves the salary system; 51Chongqing Changan Automobile Company Limited 2022 Annual Report Adhere to the efficiency oriented principle establish a payroll/labor cost generation mechanism improve distribution efficiency strengthen performance and salary benchmarking and guide units to continuously improve labor productivity and human resource value creativity; Constantly establish and improve the medium and long-term incentive and constraint mechanism closely bind the core interests of the backbone with the company's medium and long-term operations support the company's strategic development and promote the continuous improvement of the company's operating performance. 3. Training plan Company staff training in 2023 will be guided by Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era and principles of the spirit of the 20th National Congress of the Communist Party of China centering around the Third BusinessVenture-Innovation and Entrepreneurship Program. Taking “firm strategy steady and courageous progress innovative developmentand commitment to achieving goals” as the key through talent cultivation at all levels in-depth internal talent transformation work is carried out accelerating the construction of new knowledge and new capabilities for all employees and comprehensively promoting the transformation of the company into an intelligent low-carbon travel technology company. 4. Outsourcing of services □ Applicable √ Not applicable X. Distribution of profits and capital reserve The formulation implementation or adjustment of profit distribution policies especially the formulation implementation or the adjustment situation of cash dividend policy.√ Applicable □Not applicable According to the China Securities Regulatory Commission requirements the Notice on Further Implementing Matters concerning Cash Dividends of Listed Companies as issued by the CSRC the Guideline No. 3 for the Supervision of Listed Companies—CashDividends of Listed Companies in combination with the practical situation of the company the Company has rectified the “Articlesof Association” and clarified the distributable profit caliber dividend distribution means principle form cash dividend conditions and proportion stock dividend condition plan making and review procedures the implementation the conditions of distribution policy adjustment and decision-making procedures etc to strengthen the supervision of independent directors in the profit distribution plan policy adjustment and strengthen the institutional guarantee of the dividend for investors. For details of the company’s specific distribution policy please refer to the Articles of Association. Company’s reported profit distribution plan and equity shares in line with the relevant provisions of the Articles of Association and relevant provisions.Special statement for cash dividend policy Whether it comply with the Articles of Association or the resolutions of the shareholders' general meeting: Yes Are the standard and the proportion of distribution clear: Yes Are the related decision-making process and mechanism thorough: Yes Have independent directors fulfilled their duties and performed their due roles: Yes Whether medium and minority shareholders have the chance to fully express their views and demands and whether the legitimate rights and interests are fully protected: Yes Whether cash dividend policy is adjusted or changed and whether the conditions and procedures are compliant and transparent: Not Applicable During the reporting period the company made profits and the parent company could distribute profits to shareholders but did not put forward the dividend distribution plan □ Applicable √ Not applicable Plans of profit distribution and increase of capital stock by transfer of capital reserve during the reporting period √ Applicable □Not applicable Number of bonus shares per ten shares (share) 0 Dividend per ten shares (RMB) (tax included) 2.36 Increased shares through transfer for per 10 shares (shares) 0 Equity base of distribution plan (shares) 9921799422 Cash dividends (RMB) (tax included) 2341544663.59 Cash dividend (RMB) of other means (such as repurchase) - Total cash dividend (RMB) (including other means) 2341544663.59 Distributable profits (RMB) 39906030604.91 Proportion (%) of cash dividends (including other means) to total profit distribution 100% Cash dividend policy： others 52Chongqing Changan Automobile Company Limited 2022 Annual Report Detailed description of profit distribution or increase of capital stock by transfer of capital reserves The 56th meeting of the 8th Session of Board Of Directors of the company deliberated and passed the 2022 Profit Distribution Plan which still needs to be submitted to the 2022 annual general meeting for deliberation. In accordance with the provisions of the Articles of Association the relevant decision-making procedures and mechanisms are thorough which fully protect the legitimate rights and interests of medium and minority investors and the independent directors perform their duties and express their opinions.XI. Implementation of company equity incentive plans employee stock incentive plans or other incentive measures √ Applicable □ Not applicable 1. Equity incentive On July 13th 2020 the 2nd meeting of the 8th Session of Board of Directors and the 2nd meeting of the 8th Session of Board ofSupervisors reviewed and approved proposals such as “Proposal on and its Summary” and “Proposal on ”. The independent directors expressed their independent agreement on the incentive plan.On February 1st 2021 the 11th meeting of the 8th Session of Board of Directors and the 7th meeting of the 8th Session of Boardof Supervisors reviewed and approved proposals such as “Proposal on and its Summary” and “Proposal on (Revision)”. The independent directors expressed their independent agreement on the incentive plan revision.On February 18th 2021 the Company held the first extraordinary general meeting in 2021 and reviewed and approved proposals such as “Proposal on and its Summary” “Proposal on” and “Proposal on General Meeting Granting Full Authority to the Board of Directors to Handle Matters Related to Equity Incentives”.On February 22nd 2021 the Company held the twelfth meeting of the Session of Board of Directors and the 8th meeting of theSession of Board of Supervisors which reviewed and approved proposals such as “Proposal on Adjusting the List of Incentive Objectsand Incentive Quantity of the A-Share Restricted Stock Incentive Plan under Initial Granting” and "”Proposal on Granting RestrictedStocks for the First Time to Incentive Objects of A-Share Restricted Stock Incentive Plan”. The independent directors expressed their independent agreement.On March 3rd 2021 the Company completed the registration of restricted stocks and disclosed the “Announcement on theCompletion of the Registration of the Initial Granting of the A-Share Restricted Stock Incentive Plan”. 1247 people were actually granted with 76195400 restricted shares. The listing date of restricted shares was March 5 2021.On August 30th 2021 the Company held the 25th meeting of the 8th Session of Board of Directors and the 12th meeting of the 8th Session of Board of Supervisors which reviewed and approved the “Proposal on Adjusting the Repurchase Price of A-ShareRestricted Stock Incentive Plan” and “Proposal on Repurchase and Cancellation of Certain Restricted Shares Granted to IncentiveObjects but still with Sales Restriction”. The independent directors expressed independent agreement.On September 17th 2021 the Company held the second extraordinary general meeting in 2021 and reviewed and approved the “Proposal on Repurchase and Cancellation of Certain Restricted Shares Granted to Incentive Objects but still with Sales Restriction”.On November 19th 2021 the Company held the 29th meeting of the 8th Session of Board of Directors and the 15th meeting ofthe 8th Session of Board of Supervisors and reviewed and approved the “Proposal on Adjusting the Amount of Reserved A-ShareRestricted Stock Incentive Plan” and “Proposal on Granting Reserved Restricted Stocks to the Incentive Objects of the A-ShareRestricted Stock Incentive Plan”. The independent expressed independent agreement.On December 21th 2021 the Company completed the repurchase and cancellation of all 1.036 million restricted shares that had been granted to the original 11 incentive objects but still had sales restrictions.On December 30th 2021 the Company completed the registration of the reserved restricted stock and disclosed the “Announcement on the Completion of the Grant of the Reserved A-Share Restricted Stock of the Incentive Plan”; 356 people were granted with 17761200 reserved restricted stocks. The listing date of reserved restricted stocks was December 31th 2021.On August 2nd 2022 the company held the 43rd meeting of the 8th Board of Directors and the 18th meeting of the 8th Board of Supervisors and reviewed and approved the Proposal on Adjusting the Repurchase Price of A-share Restricted Stock Incentive Plan and Repurchasing and Cancelling Some Restricted Stocks. The independent directors of the company have expressed independent opinions that they agree with.On August 18th 2022 the company held the third extraordinary general meeting of shareholders in 2022 and reviewed and approved the Proposal on Adjusting the Repurchase Price of the A-share Restricted Stock Incentive Plan and Repurchase and Cancellation of Some Restricted Stocks.On February 17th 2023 the company held the 52nd meeting of the 8th Board of Directors and the 21st meeting of the 8th Board of Supervisors and reviewed and approved the Proposal on the Achievements of the First Release of Restriction Conditions during the First Grant Period of the A-share Restricted Stock Incentive Plan. The independent directors of the company have expressed independent opinions that they agree with.On March 3rd 2023 the company disclosed the "Indicative Announcement on the Release of Restricted Shares from Listing and Circulation during the First Release Period of the First Grant Part of the A-share Restricted Stock Incentive Plan" and the date of 53Chongqing Changan Automobile Company Limited 2022 Annual Report release of restricted shares from listing and circulation was March 6th 2023.Equity incentives for directors and senior management √ Applicable □ Not applicable Unit: share Price of Market Number of Number of Exercisable Shares exercised shares price at the restricted Number of newly Number of shares exercised end of the shares held shares granted Grant price of restricted Name Position during the during during the reporting at the unlocked restricted restricted shares held reporting the reporting reporting period beginning in the shares shares at the end period current during the (RMB/share) of the period period (RMB/share of the (RMB/share) ) period period reporting period period Zhu Chairman Secretary Huarong of the Party 12.31 350000 3.31 455000 Committee Director President Wang Jun Deputy Secretary of 12.31 280000 3.31 364000 the Party Committee Zhang Director The Chief Deyong Accountant Board 12.31 271600 3.31 353080 of Directors Sectary Yuan Deputy Secretary of Mingxue the Party Committee 12.31 280000 3.31 364000 Tan Executive Vice Benhong President 12.31 271600 3.31 353080 Ye Pei Executive Vice President 12.31 271600 3.31 353080 Chen Wei Executive Vice President 12.31 271600 3.31 353080 Li Executive Vice Mingcai President 12.31 271600 3.31 353080 Yang Executive Vice Dayong President 12.31 194000 7.46 252200 Peng Tao Executive Vice Presiden 12.31 191240 3.31 248612 Zhang Xiaoyu Vice President 12.31 191240 3.31 248612 Wang Xiaofei Vice President 12.311323003.31171990 Wang Hui Vice President 12.311323003.31171990 Zhang Fatao Vice President 12.31 191240 3.31 248612 Li Jun Board of Directors Sectary 12.31 191240 3.31 248612 Li Wei Executive Vice President (outgoing) 12.31 271600 3.31 353080 He Executive Vice Chaobing President (outgoing) 12.31 271600 3.31 353080 Zhao Fei Executive Vice President (outgoing) 12.31 271600 3.31 353080 Secretary of Hua Discipline & Zhanbiao Inspection 12.31 271600 3.31 353080 Commission (outgoing) Total -- -- -- 4577960 -- 5951348 1. The above-mentioned personnel and positions are as of the disclosure date of this report; Notes (if any) 2. The original initial grant price of the Company's A-share restricted shares was 6.66 yuan per share and the reserved grant price was 9.93 yuan per share. The number of shares and the grant price have been adjusted accordingly based on the implementation of the Company's equity distribution plans for 2020 and 2021.Evaluation mechanism and incentives for senior managers For details please refer to “V. 3. Remuneration of Directors Supervisors and Senior Management” in Chapter 4. 2. Implementation of employee stock ownership plans □ Applicable √ Not applicable 54Chongqing Changan Automobile Company Limited 2022 Annual Report 3. Other employee incentives □ Applicable √ Not applicable XII. Internal control system building and implementation during reporting period 1. Internal control building and implementation Optimize the internal control team and improve control effectiveness. Establish a matrix team of company level internal control specialists open up internal control communication channels at all levels of the company form a working mechanism with clear responsibilities and clear communication from top to bottom and improve the communication efficiency of cross department internal control work. Carry out online and offline training in real time empower units at all levels of the company and promote the synchronous improvement of internal control awareness and professional level of units at all levels of the company.Improve the management system and strengthen the binding force of the internal control system. Improve top-level design promote inventory management revise and issue the Internal Control Evaluation Manual clarify the division of work and responsibilities of internal control standardize the scope standards steps and other requirements of internal control evaluation improve the internal control system and achieve closed-loop management of control evaluation and rectification. Continuously integrate and optimize business systems embed internal control system control requirements into specific business systems clarify business link control requirements and risk response measures and build a standardized comprehensive and effective management system.Strengthen authorization management and improve internal control and supervision mechanism. Carry out the clean-up of the entire level authorization management system refine the power and responsibility boundaries of each level based on the authorization list of the board of directors and reformulate and issue the management authorization form and centralized and decentralized authority list for institutions at all levels. Prepare a list of incompatible positions comprehensively clean up incompatible positions at all levels of the company's institutions sort out the responsibilities of important positions and key personnel adjust unreasonable positions and personnel settings and achieve the separation of incompatible position responsibilities and personnel.Carry out comprehensive internal control evaluation to promote the continuous optimization of the internal control system.Organizations at all levels of the company use the Internal Control Evaluation Manual as a standardized process to actively evaluate the effectiveness of the implementation of the internal control system identify problems develop measures improve implementation and ensure the effective operation and rigid constraints of the company's internal control system. 2. Details of significant defects in internal control during the reporting period □ Yes √ No XIII. Management and control of subsidiaries of the company during the reporting period Name Integration plan Integration Problems progress encountered in Solutions taken Progress Follow-up the integration solution plan Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Note: During the reporting period the company has no new purchase of subsidiaries.XIV. Internal control self-evaluation report or internal control audit report 1. Self-evaluation report of internal control Date of Full-text disclosure of internal control evaluation report April 18th 2023 Inquiry index of internal control evaluation report full text disclosure Juchao (www.cninfo.com.cn) The proportion of the total assets of units included in the evaluation scope to the total assets in the company's consolidated 91.88% financial statements The proportion of the operating income of the unit in the evaluation scope to the total operating income of the company's 93.25% consolidated financial statements 55Chongqing Changan Automobile Company Limited 2022 Annual Report Defect identification standard Type Financial reports Non-financial report 1. Fraud of the directors supervisors and 1. Lack of or violation of democratic senior managers of the Company. decision-making procedures; 2. The Company shall correct the published 2. Violation against state laws and financial report to correct major regulations with serious punishment; misstatements caused by fraud or errors or 3. Large loss of medium and senior major misstatements in the current financial management personnel and senior Qualitative standards report found by certified public accountants technical personnel; but not identified by the company's internal 4. Frequent and serious negative media control of the Company. coverage that spread far; 3. The Audit Committee has ineffective 5. Lack of institutional control or supervision over the company’s external institutional system failure of important financial reports and financial report internal business; control. 6. Major defects in internal control not rectified.The misstatement amount in the financial Identification according to the internal Quantitative standards statements in the following range: control defect quantitative standard in Misstated 1% of the total assets financial report.Number of material defects in financial reports 0 Number of material defects in non- financial reports 0 Number of important defects in financial reports 0 Number of important defects in non- financial reports 0 2. Internal control audit report √ Applicable □ Not applicable Review opinions of the internal control audit report The audit opinions in the internal control audit report issued by Ernst & Young Huaming LLP (Special General Partnership) are as follows: Chongqing Changan Automobile Co. Ltd. has maintained an effective internal control of financial report in all major aspects on December 31st2022 in accordance with the Basic Standards for Internal Control of Enterprises and relevant provisions.Disclosure of the internal control audit report Disclosed Date of full text disclosure of the internal control audit report April 18th 2023 Inquiry index of Internal Control Audit Report Juchao (www.cninfo.com.cn) Opinion type of internal control audit report Standard without reservations Material defects in non-financial reports None Whether the accounting firm issues a non-standard opinion internal control audit report □Yes √ No Whether the internal control audit report issued by the accounting firm is consistent with the self-evaluation report of the board of directors √Yes □No XV. Rectification of self-inspection problems in the Special Action of Listed Companies According to the company’s self-inspection the company’s overall compliance operation shows that there are no issues requiring rectification. 56Chongqing Changan Automobile Company Limited 2022 Annual Report Chapter 5 Environmental and Social Responsibility Ⅰ. Major Environment Concerns Whether the listed company and its subsidiaries are reckoned as major pollutant discharging units by environment protection department or not √Yes □No Environmental protection-related policies and industry standards The company strictly implements the laws regulations standards and requirements for environmental protection in its production and operation. The regulatory standards include Environmental Protection Law of the People’s Republic of China Law on Air Pollution Prevention and Control Law of the People’s Republic of China on Prevention and Control of Water Pollution Law of the People’s Republic of China on Prevention and Control of Environmental Pollution by Solid Waste Law of People’s Republic of China on Environmental Impact Assessment etc.Administrative regulations or rules include Measures for the Administration of Environmental Monitoring Measures for the Administration of the List of Key Units of Environmental Supervision Measures for Enterprise Environmental Credit Evaluation Administrative Measures for the Legal Disclosure of Enterprise Environmental Information Contingency Plan for Environmental Emergencies etc.National standards include Integrated Wastewater Discharge Standard Integrated Emission Standard of Air Pollutants Emission Standard of Air Pollutants for Foundry Industry Standard for Fugitive Emission of Volatile Organic Compounds Technical Requirement for Low-Volatile-Organic-Compound-Content Coatings Product etc. Industry standards include Technical Specification for Application and Issuance of Pollutant Permit Automotive Industry Self-Monitoring Technology Guidelines for Pollution Sources Technical specification for operation of wastewater online monitoring system (CODCr NH3-N et al.) Technical guide for leak detection and repair of volatile organic compounds in industries etc.Local standards include Emission standard of Air Pollutants for Surface Coating of Automobile Manufacturing Industry Emission Standard of Air Pollutants for Catering Industry Emission Standard of Air Pollutants for Boilers etc. The company collects and interprets the newly released and implemented regulations and standards quarterly and conducts compliance evaluations to ensure that the company’s production and operation are always legally compliant.Environmental Protection Administrative License ——Administrative License Information for Construction Projects In 2022 there will be a total of 6 EIA approval documents for construction projects as follows: Name and document number of Name of construction project environmental impact assessment approval Approval Authority Approval document acquisition time Chongqing Changan Automobile Co. Ltd. Changan Automobile Chongqing Construction Project C589 Series Passenger Vehicle Environmental Impact Assessment Chongqing Ecology and Environment June 27th 2022 Production Line Technical Document Approval Letter (YSHZ [2022] No. 036) Bureau Transformation Project Technical Transformation Project Chongqing Construction Project Chongqing Ecology of the New Series New Energy Environmental Impact Assessment and Environment Vehicle Production Line in the First Document Approval Letter Bureau (Liangjiang January 24th 2022 Plant Area of Liangjiang Factory (YLJHZ [2022] No. 007) New Area Branch) Chongqing Construction Project Chongqing Ecology NE1 Series Engine Phase III Environmental Impact Assessment and Environment Technical Transformation Project Document Approval Letter Bureau (Liangjiang May 27th 2022 (YLJHZ [2022] No. 054) New Area Branch) EDS2 electric drive and electric Chongqing Construction Project Chongqing Ecology control housing production line Environmental Impact Assessment and Environment September 21st technical transformation project Document Approval Letter Bureau (Liangjiang 2022 (YLJHZ [2022] No. 118) New Area Branch) Environmental Protection Reply on the Environmental Impact Report of Relocation (Replacement and the Environmental Protection Relocation Nanjing Ecology Upgrade) Project of Nanjing (Replacement and Upgrade) Project of and Environment September 5th 2022 Changan Automobile Co. Ltd Nanjing Changan Automobile Co. Ltd. Bureau (NHJ [2022] No. 17) 57Chongqing Changan Automobile Company Limited 2022 Annual Report Approval Opinions on the EnvironmentalHefei Changan Automobile Co. Impact Report of “Hefei ChanganLtd. C928 Series Passenger Vehicle Automobile Co. Ltd. C928 Series Passenger Hefei Ecology and Production Line Technical Vehicle Production Line Technical Environment July 27th 2022Transformation Project Transformation Project” Bureau (HJS [2022] No. 10086) ——Information on administrative permission for pollutant discharge In 2022 each base involved a total of 36 pollution discharge license documents including 5 re applications 23 changes and 8 extensions. For details see the "National Pollution Discharge License Management Information Platform" at http://permit.mee.gov.cn.——Other administrative licensing information None.Industry emission standards and specific conditions of pollutant emissions involved in production and business activities Name of the Total company or Main pollutants and specific Discharge Number of Distribution Discharge Total pollutants means discharge of discharge concentration Pollutant discharge standards discharge approved Excessive subsidiary outlets outlets (mg/L) (Tons/year) discharge emissions (Tons/year) COD 39.61 13.65 347.90 —Ammonia Two outlets for 1.09 Integrated Wastewater Discharge nitrogen workshop Standard（GB8978-1996); The 0.3831.31— Wastewater Total nickel Intermittent 3 facilities 0.20 Influent Water Quality emissions and one Requirements set by the Yubei 0.040.17— Total zinc main outlet 0.14 District Sewage Treatment Plant in Chongqing 0.03 3.48 — for the Plant Phosphate 0.29 0.08 0.70 — Sulfur 8.50 Emission Standard of Air Pollutants 2.91 16.95 — Chongqing dioxide for Surface Coating ofChangan Nitrogen 47.43 Automobile Manufacturing Industryoxides 27.04 75.40 — Automobile （DB 50/577-2015);Co. Ltd. Particulate 1.66 Emission Standards of Air Yubei Plant matter 5.0194.33— Exhaust gas Organized Outlets Pollutants for Industrial Kiln andVolatile emissions 32 around the Plant Furnace（DB 50/659-2016); organic 1.57 Integrated Emission Standards of 3.11 221.21 —compounds Air Pollutants（DB 50/418-2016);Emission Standards of Air Toluene +Xylene 0.17 Pollutants for Boiler（DB 50/658- 0.50 50.00 — 2016)During the reporting period the Yubei Plant of Chongqing Changan Automobile Co. Ltd. was included in the List of Key Pollutant Discharge Soil Units of Chongqing in 2022 with a total of 1866.26 tons of hazardous waste generated in this period. The 1861.65 tons have been legally utilized and disposed of by manufacturers with hazardous waste operation permits produced 18369.87 tons of general industrial solid waste and — 18369.87 tons of utilization and disposal. COD An outlet for 97.13 Integrated Wastewater Discharge 6.00 14.02 —Ammonia workshop 2.78 Standard（GB8978-1996); The nitrogen Intermittent facilities Influent Water Quality 0.60 1.40 — Wastewater 2Total nickel emissions and one 0.13 Requirements set by Guoyuangang main outlet Sewage Treatment Plant in 0.01 0.04 — Total zinc for the Plant 0.12 Chongqing 0.06 0.28 — Sulfur Emission standard of Air Pollutants Chongqing dioxide 3.06 0.85 1.23 — for Surface Coating of Changan Nitrogen Automobile Manufacturing IndustryAutomobile oxides 26.99 9.68 18.23 — （DB 50/577-2015);Co. Ltd. Particulate Emission Standards of Air (Liangjiang matter 6.61 13.97 36.14 — Exhaust gas Organized Outlets Pollutants for Industrial Kiln andPlant Volatile emissions 26 around the Plant Furnace（DB 50/659-2016); Campus No. organic 10.76 Integrated Emission Standards of 13.82 63.06 —1) compounds Air Pollutants（DB 50/418-2016);Emission Standards of Air Toluene +xylene 0.58 Pollutants for Boiler（DB 50/658- 0.65 2.68 — 2016)During the reporting period Liangjiang Plant Campus No. 1 of Changan Automobile was included in the List of Key Pollutant Discharge Soil Units of Chongqing in 2022 with a total of 1854.42 tons of hazardous waste in this period. A total of 1850.31 tons were legally utilized and disposed of by manufacturers with hazardous waste operation permits produced 16297.49 tons of general industrial solid waste and 16297.49 — tons of utilization and disposal.Chongqing COD An outlet for 75 Integrated Wastewater Discharge 33.81 46 —Changan Ammonia workshop Standard（GB8978-1996); TheAutomobile nitrogen Intermittent facilities 3.8 Influent Water Quality 1.66 4.6 — Co. Ltd. Wastewater 2 (Liangjiang Total nickel emissions and one Requirements set by the main outlet 0.10 Guoyuangang Sewage Treatment 0.008 0.14 — Plant Total zinc for the Plant 0.05 Plant in Chongqing 0.03 1.38 — 58Chongqing Changan Automobile Company Limited 2022 Annual Report Campus No. Sulfur 0 Emission standard of Air Pollutants 2) dioxide 0 4.12 — for Surface Coating ofNitrogen 61 Automobile Manufacturing Industryoxides 27.10 34.72 — （DB 50/577-2015);Particulate 8.28 Emission Standards of Air matter Outlets 19.85 50.61 — Organized Pollutants for Industrial Kiln and Exhaust gas Volatile emissions 50 around the Plant Furnace（DB 50/659-2016); organic 6.47 Integrated Emission Standards of 364.31 543.23 —compounds Air Pollutants（DB 50/418-2016);Emission Standards of Air Toluene +xylene 0.63 Pollutants for Boiler（DB 50/658- 1.09 1.54 — 2016)During the reporting period Liangjiang Plant Campus NO. 2 was included in the List of Key Pollutant Discharge Units of Chongqing in 2022 Soil with a total of 3136.72 tons of hazardous waste. The 3111.17 tons were legally utilized and disposed of by manufacturers with hazardous — waste operation permits produced 31405.87 tons of general industrial solid waste and 31405.87 tons of utilization and disposal.COD 55.3 An outlet for Integrated Wastewater Discharge 13.9245—workshop Standard（GB8978-1996); TheWastewater Total nickel Intermittent 2 facilities 0.13 Influent Water Quality 0.01 0.1 — emissions and one Requirements set by the Ammonia main outlet Guoyuangang Sewage Treatment nitrogen 2.53 0.65 4.5 — for the Plant Plant in Chongqing Total zinc 0.095 0.02 0.81 — Particulate Emission standard of Air Pollutants Chongqing matter 8.6 for Surface Coating of 13.44 64.24 — Changan Automobile Manufacturing IndustryAutomobile VOCs 6.15 （DB 50/577-2015); 10.69 244.36 —Co. Ltd. Emission Standards of Air (Liangjiang SO2 Organized Outlets 0 Pollutants for Industrial Kiln and 0.48 5.34 —Plant Exhaust gas emissions 42 around the Plant Furnace（DB 50/659-2016); Campus No. Toluene + 0.322 Integrated Emission Standards of 3) xylene 0.34 0.95 — Air Pollutants（DB 50/418-2016);Emission Standards of AirNOx 19 Pollutants for Boiler（DB 50/658- 4.18 24.78 — 2016) During the reporting period Liangjiang Plant Campus NO. 3 was included in the List of Key Pollutant Discharge Units in Chongqing in 2022 Soil with a total of 2018.65 tons of hazardous waste generated in this period. 2030.99 tons were legally utilized and disposed of by manufacturers with hazardous waste operation permits produced 19542.43 tons of general industrial solid waste and 19542.43 tons of utilization and — disposal.COD 83 Integrated Wastewater Discharge 16.21 22.5 —Standard（GB8978-1996); TheWastewater Intermittent 1 Main outlet Influent Water Quality Ammonia emissions for the Plant Requirements set by the nitrogen 2.84 Guoyuangang Sewage Treatment 0.52 2.25 — Chongqing （NH3-N） Plant in Chongqing Changan Automobile Particulate 21.19 14.18 — — Co. Ltd. matter Emission Standards of Air (Jiangbei SO2 Outlets 10.8 Pollutants for Industrial Kiln and Exhaust gas Organized 7.24—— Engine VOCs emissions93 around the Furnace（DB 50/659-2016);Plant Plant Plant 0.609 Integrated Emission Standards of 0.44 — —No.1） Air Pollutants（DB 50/418-2016) NOx 14.73 9.86 — —During the reporting period Jiangbei Engine Plant Plant NO. 1 was included in the List of Key Pollutant Discharge Units in Chongqing in Soil 2022 and a total of 2944.85 tons of hazardous waste was generated in this period. 2944.85 tons were legally utilized and disposed of by manufacturers with hazardous waste operation permits or exemption certificates produced 934.86 tons of general industrial solid waste and — 934.86 tons of utilization and disposal. COD 43.2 Integrated Wastewater Discharge 9.652 11.08 —Standard（GB8978-1996); TheWastewater Intermittent Main outlet Influent Water Quality Ammonia emissions 1 for the Plant Requirements set by Guoyuangang Chongqing nitrogen 3.45 Sewage Treatment Plant in 0.372 1.11 — Changan （NH3-N） Chongqing Automobile Co. Ltd. Non- (Jiangbei methane Engine total 22.52 1.57 — — Plant Plant hydrocarbon Emission Standards of AirNo. 2 s Outlets Pollutants for Industrial Kiln and ）Exhaust gas Nitrogen Organized emissions 37 around the 12.25 Furnace（DB 50/659-2016); oxides factory Integrated Emission Standards of 3.17 — —Particulate 34.58 Air Pollutants（DB 50/418-2016) matter 8.15 —Sulfur dioxide 7.01 1.81 — — 59Chongqing Changan Automobile Company Limited 2022 Annual Report During the reporting period Jiangbei Engine Plant Plant NO. 2 was included in the List of Key Pollutant Discharge units in Chongqing in Soil 2022 and a total of 5952.91 tons of hazardous waste was generated in this period. 5952.91 tons were legally utilized and disposed of by manufacturers with hazardous waste operation permits or exemption certificates produced 641.4 tons of general industrial solid waste and — 641.4 tons of utilization and disposal. COD 34 7.34 25.76 — Ammonia An outlet fornitrogen workshop 2.5 Integrated Wastewater Discharge 0.42 3.48 — Standard（GB8978-1996); TheWastewater Total nickel Intermittent 3 facilities emissions and two 0 Inlet Water Quality Requirements 0.00 — — set by Guoyuangang Sewage Total zinc main outlets for the Plant 0.02 Treatment Plant in Chongqing 0.01 — — Phosphate 0.08 0.03 0.13 — Particulate Emission standard of Air Pollutants matter 4.6 18.06 38.03 — Chongqing for Surface Coating of Lingyao Volatile Automobile Manufacturing IndustryAutomobile organic 0.61 （DB 50/577-2015); 4.35 111.4 —Co. Ltd. compounds Emission Standards of Air Organized Outlets Toluene + Pollutants for Industrial Kiln and Exhaust gas 40 around thexylene emissions 0.60 Plant Furnace（DB 50/659-2016); 1.256.46— Integrated Emission Standards ofSulfur Air Pollutants（DB 50/418-2016);dioxide 3 Emission Standards of Air 0.21 7.12Nitrogen Pollutants for Boiler（DB 50/658-oxides 3 2016) 0.69 16.26 During the reporting period Chongqing Lingyao Automobile Co. Ltd. (Changan Suzuki) was included in the List of Key Pollutant Discharge Soil Units in Chongqing in 2022 and a total of 2213.2 tons of hazardous waste was generated in this period 2213.2 tons were legally utilized and disposed of by manufacturers with hazardous waste operation permits or exemption certificates produced 15899.33 tons of general industrial — solid waste and 15899.33 tons of utilization and disposal.COD An outlet for 59.29 13.63 63.68 — Ammonia workshop nitrogen Intermittent facilities 3.52 Integrated Discharge Standard of 1.19 3.81 — Wastewater Total nickel emissions 2 and a main 0.03 Water Pollutants (DB11/307-2013) 0.0005 0.01 — Chongqing outlet for the Changan Phosphate Plant 1.92 0.04 / — Automobile Co. Ltd. Nitrogen oxides 12.3 Emission standard of Air Pollutants Beijing Outlets for Surface Coating of 0.373.18— Changan Exhaust gas Organized 52 around the Automobile Manufacturing Industry Volatile Automobile emissions Plant (DB11/1227-2015); organic 3.56 Company Integrated Emission Standards of 8.53458.76— compounds Air Pollutants（DB11/501-2017） During the reporting period Chongqing Changan Automobile Co. Ltd. Beijing Changan Automobile Company was included in the List of Key Soil Pollutant Discharge units in Beijing in 2022 and a total of 551.09 tons of hazardous waste was generated in this period 551.09 tons were legally utilized and disposed of by manufacturers with hazardous waste operation permits or exemption certificates produced 6648.6 tons of — general industrial solid waste and 6648.6 tons of utilization and disposal.COD 35.224 23.99 144.13 — Total Two outlets nitrogen for 9.601 Integrated Wastewater Discharge 6.54 39.44 —Intermittent workshop Standard（GB8978-1996); Wastewater 3 facilitiesTotal nickel emissions 0.006 The Pipe Standards set by Hefei and a main West Group Sewage Treatment 0.004 0.09 — outlet for the Plant Total Hefei Plant phosphorus 0.174 0.12 4.73 Changan Automobile Ammonia Co. Ltd nitrogen 0.449 0.31 14.41 — Outlets Emission Control Standard for Organized Industrial Enterprises Volatile Exhaust gas VOCs emissions 83 around the 1.3 Plant Organic Compounds of Tianjin 4.2671139.6— （DB12/524-2020） During the reporting period Hefei Changan Automobile Co. Ltd. was included in the List of Key Pollutant Discharge Units in Hefei in 2022 Soil and a total of 1968.87 tons of hazardous waste was generated in this period 1987.23 tons were legally utilized and disposed of by manufacturers with hazardous waste operation permits or exemption certificates produced 23532.7 tons of general industrial solid waste and — 23532.7 tons of utilization and disposal. COD 37.55 5.83 13.34 — Total nitrogen 2.83 0.22 14.24 — An outlet for workshop Integrated Wastewater DischargeNanjing Total nickel 0.19 Standard（GB8978-1996); 0.006 0.06Changan Wastewater Intermittent facilities emissions 2 and a main The Pipe Standards set by Nanjing Automobile Total outlet for the Lishui Qinyuan Sewage Treatment Co. Ltd. phosphorus 0.19 Co. Ltd. 0.02 0.08 — Plant Ammonia nitrogen 0.94 0.06 0.26 —（NH3-N） NOx 6 9.67 2.35 8.79 — 60Chongqing Changan Automobile Company Limited 2022 Annual Report Exhaust gas Particulate Outlets 0.6 Emission standard of Air Pollutants matter around the for Surface Coating of 2.58 10.24 — VOCs Plant 4.3 Automobile Manufacturing Industry 16.32 38.48 — Organized (DB32/2862 – 2016); emissions Integrated Emission Standards of Air Pollutants (GB 16297 - 1996); SO2 3 Emission Standards of Air 0.24 53.4 — Pollutants for Boiler (GB13271- 2014) During the reporting period Nanjing Changan Automobile Co. Ltd. was included in the List of Key Pollutant Discharge Units in Nanjing in Soil 2022 and a total of 678.14 tons of hazardous waste was generated in this period 685.64 tons were legally utilized and disposed of by manufacturers with hazardous waste operation permits or exemption certificates produced 131.98 tons of general industrial solid waste and — 131.98 tons of utilization and disposal. Ammonia nitrogen 1.4 0.19 4.8 — COD 68.31 7.85 63.71 — An outlet for workshop Integrated wastewater discharge Wastewater Total Intermittent facilitiesstandard（GB8978-1996);nitrogen emissions 2 and a main 4.93 The Influent Water Quality 0.39 7.32 — outlet for the Requirements Set by Gezhouba Plant Water Dingzhou Branch Chongqing Total phosphorus 1.42 0.09 0.92 Changan Kaicheng Automobile Total nickel 0.14 0.001 0.03 — Technology Sulfur Integrated Emission Standards of Co. Ltd. dioxide 3 Air Pollutants GB16297-1996; 0.3 30.01 — Campus Non- Emission Standards of Air NO.1(Hebei methane Pollutants for Industrial Kiln and Changan total Furnace DB1640-2012; Outlets 2.5 12.14 570.34 — Automobile hydrocarbon Organized Emission Control Standards for Co. Ltd) Exhaust gas s emissions 51 around the plant Volatile Organic Compounds by Particulate Industrial Enterprises DB13/2322- matter 4.05 2016; 5.43 53.4 — Emission Standards of Air Nitrogen oxides 7Pollutants for Boiler（DB13/5161- 6.65 31.47 — 2020) During the reporting period Campus NO.2 of Chongqing Changan Kaicheng Automobile Technology Co. Ltd. (formerly known as Hebei Soil Changan) was included in the List of Key Pollutant Discharge Units in Dingzhou In 2022 with a total of 661.28 tons of hazardous waste generated in this period of which 658.38 tons have been legally utilized and disposed of by suppliers with hazardous waste operation permits — produced 7128.16 tons of general industrial solid waste and 7128.16 tons of utilization and disposal.COD 104.43 10.77 72.71 — Ammonia nitrogen A workshop 6.23 0.42 4.14 — facilitydischarge Integrated Wastewater Discharge Total 13.25 Standard（GB8978-1996); 0.92 5.51 —Wastewater nitrogen Intermittent emissions 2 outlet and one factory The Influent Water Quality Total total Requirements Set by Gezhouba Chongqing phosphorus discharge 1.43 Water Dingzhou Branch 0.12 1 Changan outlet Kaicheng Automobile Nickel 0.19 0.004 0.06 — Technology Sulfur - Integrated Emission Standards of Co. Ltd. dioxide Air Pollutants GB16297-1996; 3.8 88.23 — Campus Nitrogen 7 Emission Standards of Air NO.2(Baodi oxides Pollutants for Industrial Kiln and 8.01 33.75 — ng Changan Particulate Outlets Furnace DB1640-2012; Bus matter Organized 1.5 94 around the Emission Control Standards for 15.62850.8— Manufacturi Exhaust gas emissions plant Volatile Organic Compounds by ng Co. Ltd) Industrial Enterprises DB13/2322- Volatile 2016; organic 3.88 Emission Standards of Air 81.97 880.62 —compounds Pollutants for Boiler（DB13/5161- 2020) During the reporting period Campus NO.2 of Chongqing Changan Kaicheng Automobile Technology Co. Ltd. (formerly known as Changan Soil Bus) was included in the List of Key Pollutant Discharge Units in Dingzhou in 2022. A total of 930.18 tons of hazardous waste were generated in this period and 928.66 tons were legally utilized and disposed of by suppliers with hazardous waste operation permits produced 10.212.26 — tons of general industrial solid waste and 10212.26 tons of utilization and disposal.All pollutants are discharged to the standard and there is no discharge exceeding the standard and the total amount. For details of the name distribution and pollutant discharge of each discharge outlet please refer to the "National Pollutant Discharge Certificate Management Information Platform" (Website: http: //permit mee. gov.cn) and "Changan Automobile Brand Official Website" for details (Website: https://www.changan.com.cn/sociology?index=2).Treatment of pollutants Pollutant type Main processing technology Processing method Spraying VOCs exhaust Venturi wet paint mist treatment+zeolite rotary adsorption Deal with by oneself or gas concentration+TNV incineration; Activated carbon adsorption themselves Exhaust gas (Changan Nanjing); Low temperature plasma (Changan Bus) Drying VOCs exhaust gas TNV or RTO incineration Deal with by oneself or themselves Other VOCs exhaust gas Activated carbon adsorption Deal with by oneself or 61Chongqing Changan Automobile Company Limited 2022 Annual Report themselves Test exhaust gas (nitrogen oxide) Automotive three-way catalytic converter Deal with by oneself or themselves Foundry dust Bag type dust removal Deal with by oneself or themselves Foundry stench Alkali adsorption or biosorption Deal with by oneself or themselves Refueling mist Mechanical filtration Deal with by oneself or themselves Phosphating waste gas Coagulation sedimentation Self processing or outsourcing operations Wastewater Oily wastewater Oil separation+air flotation Self processing or outsourcing operations Comprehensive wastewater Coagulation sedimentation+aerobic biochemistry Self processing or outsourcing operations Waste solvent Utilization or incineration Outsourcing utilization and disposal Wet metal chips Utilize Outsourcing utilization and disposal Aluminum ash packaging Utilize Outsourcing utilization Solid waste drum and disposal Wastewater treatment Landfill Outsourcing utilization sludge and disposal Recyclable general Outsourcing utilization industrial solid waste Utilize and disposal Others Incineration or landfill Outsourcing utilization and disposal Noise Mechanical noise Damping and sound insulation Deal with by oneself or themselves In 2022 Yubei Plant added a set of TNV exhaust gas treatment facilities. Pollution treatment facilities are included in the preventive maintenance management of equipment like other production equipment. There are standing books operating procedures or operation instructions preventive maintenance procedures preventive maintenance plans and implementation records equipment spot inspection dosing slag removal consumables replacement and other operation records. All facilities run normal. Key pollutant discharge units are equipped with automatic monitoring facilities for wastewater and waste gas according to the requirements of the local department of ecological conservation and entrust a third-party professional company for operation and maintenance. The facilities run normal. There is no abnormal operation of pollution treatment facilities in 2022.Contingency Plan for environmental emergencies The manufacturing sites as required carries out risk assessment of environmental emergencies emergency resource surveys formulated or revised contingency plans for environmental emergencies prepared on-site response plans for units with environmental risk and continuously carried out hidden danger investigation and treatment. In 2022 Yubei Plant Nanjing Changan and other sites completed the revision and filing of contingency plan for environmental emergencies as shown in the following table: Unit Contingency Plan File Code Filing Authority Chongqing Yubei District Ecological Environmental Yubei Plant Chongqing Changan Automobile Co. Ltd. Yubei Plant Protection Contingency Plan for Environmental Emergencies 500112-2022-065-L Comprehensive Administrative Law Enforcement Detachment Chongqing Ecology and Liangjiang Plant Chongqing Changan Automobile Co. Ltd. Liangjiang NO.1 Plant NO.1 Risk Assessment Report on Environmental 500128-2022-156-L Environment Bureau Emergencies (Liangjiang New Area Branch) Liangjiang Plant Chongqing Changan Automobile Co. Ltd. Liangjiang Chongqing Ecology and NO.2 Plant NO.2 Contingency Plan for Environmental 500128-2022-183-L Environment Bureau Emergencies (Revised Version) (Liangjiang New Area Branch) Jiangbei Engine Chongqing Changan Automobile Co. Ltd. Jiangbei Chongqing Ecology and Engine Plant (1# site) Contingency Plan for 500128-2022-036- Environment Bureau Plant Environmental Emergencies M (Liangjiang New Area Branch) Changan Bus Baoding Changan Bus Manufacturing Co. Ltd. Dingzhou Ecology and Contingency Plan for Environmental Emergencies 139001-2022-113-L Environment Bureau Nanjing Changan Nanjing Changan Automobile Co. Ltd. Contingency Plan Lishui Ecology and for Environmental Emergencies 3201242022087L Environment Bureau 62Chongqing Changan Automobile Company Limited 2022 Annual Report Chongqing Banan District Ecological Environmental Chongqing Chongqing Lingyao Automobile Co. Ltd. Plant 2 Protection Lingyao Contingency Plan for Environmental Emergencies 500113-2022-032-L Comprehensive Administrative Law Enforcement Detachment All bases formulate emergency drill plans in accordance with the requirements of laws and regulations and carry out emergency drills as planned so as to continuously improve the practicality of emergency plans and the emergency handling ability of employees.No environmental emergencies occurred in 2022.Environmental self-monitoring plan In 2022 key units responsible for pollution discharge of the company prepared self-monitoring plans and carried out self- monitoring in accordance with the requirements of laws and regulations and disclosed monitoring information on self-monitoring data release platforms of various provinces as required by local ecological environment authorities. See the following table for the public websites.Units Environmental Self-Monitoring Plan Disclosure Platform Website Yubei Plant Liangjiang Plant Jiangbei Key Pollution Source Monitoring Data http://119.84.149.34:20003/publish2/dat Engine Plant Chongqing Lingyao Release Platform aSearchPub/entList.aspx Beijing Environmental Information Beijing Changan Automobile Company Disclosure Platform for Enterprises and http://xxgk.bevoice.com.cn/monitor- Institutions pub/index.do Hefei Changan Automobile Co. Ltd Anhui Province Discharge Units Self-Monitoring Information Disclosure Platform http://39.145.0.253:8081/index Nanjing Changan Automobile Co. Ltd. Jiangsu Province Discharge Units Self- http://218.94.78.61:8080/newPub/web/hMonitoring Information Disclosure Platform ome.htm Kaicheng Automobile Technology Co. National Pollution Source Monitoring Ltd. (formerly known as Hebei Changan Information Management and Sharing https://wryjc.cnemc.cn/gkpt/mainZxjc/1 and Changan Bus) Platform 30000 Investment in environmental treatment and protection and payment of environmental protection tax The company’s environmental protection investment mainly includes: the construction of environmental protection facilities operation and maintenance of environmental protection facilities solid waste transportation and disposal (hazardous waste included) sewage treatment monitoring revision of contingency plans purchase of emergency materials environmental protection tax etc.The company paid environmental protection tax of 1327500 yuan in 2022.Measures taken to reduce carbon emissions during the reporting period and effects √ Applicable □Not applicable In response to the national “3060” dual carbon strategy Changan has set up a carbon peak & carbon neutralization joint taskforce with the Chairman as the leader of the leading group to promote the implementation of the overall work. The organizational structure is composed of the leading group business coordination group and dedicated business working group (low-carbon products low- carbon technology low-carbon manufacturing low-carbon supply low-carbon digitization and low-carbon cost) to jointly promote the green and low-carbon transformation of the company and build an intelligent low-carbon mobility technology company.To achieve the carbon peaking and carbon neutrality targets Changan has taken solid efforts in energy-saving and carbon-reducing measures in the manufacturing achieving a 5.1% year-on-year reduction in the carbon emission per vehicle. There were five dimensionsincluding “energy & efficiency optimization process optimization production plan optimization lean management and qualityimprovement". With these dimensions as focus we carried out energy conservation and carbon reduction in production bases of sself- owned Chinese brands reducing carbon by 21000 tons. We built photovoltaic power plants with scientific plans and actively promoted energy mix transformation and upgrading towards green and low-carbon energy. The three major bases in Hefei Hebei and Nanjing have built 42.4MW of photovoltaic power stations which generated green and clean energy for their own use. The total consumption of green electricity throughout the year stood at 37.76 million kWh carbon emissions was down by 32000 tons. We actively participated in green power market transactions to further expand the proportion of green energy used and reduce corporate carbon emissions.Changan has actively carried out R&D of low-carbon technologies as the first manufacturer in the industry to apply a number of technologies in mass production. Changan launched the BEV ultra-integrated e-drive system Force the intelligent hybrid iDD and Zhuge intelligent technology. The new generation of ultra-integrated e-drive can reach maximum efficiency of 95%. Changan’s seven- in-one “smart core” (SVCU) cut volume by 70% with a 70% increase in overall performance. The iBC battery management system 63Chongqing Changan Automobile Company Limited 2022 Annual Report has extended the battery life by more than 20%. We have breakthroughs in NEV platform technology and launched the first vehicle with three powertrains namely FCEV BEV and REEV. Other breakthroughs occurred in new materials such as advanced thermoforming technology and steel-aluminum body structure and research on the performance of key low-carbon materials such as recycled aluminum alloys and bio-based nylon was completed. Changan is dedicated to creating green and low-carbon products. Up to now 17 Changan models have been awarded as national “Green Design Products”.Administrative penalties imposed for environmental reasons during the reporting period are shown below None.Other environmental protection-related information 1. Environmental credit evaluation In 2022 the production bases carry out the 2021 environmental credit evaluation according to the requirement of local ecological environment authorities. Yubei Plant the 3 bases of Liangjiang Plant 2 bases of Jiangbei Plant and Lingyao Automobile were named “Enterprises of Integrity in Environmental Protection”. Tooling Business Unit was named “Enterprises of Integrity in EnvironmentalProtection” in Yubei district and Nanjing Changan was named “Enterprise of Integrity” in 2021 by Jiangsu Province. Hefei Changan was named “Enterprises of Integrity in Environmental Protection” in 2021 by Anhui Province. Hebei Changan and Changan Bus were B-class enterprises of Dingzhou city. 2. Green supply management information Changan plays an active role in radiating the industry to build the partnership of mutual trust shared responsibility and shared benefits for a new supply chain system of open cooperation mutual benefit and sustainable development. We have established the management process and cloud management platform where Changan coordinates with suppliers covering all links from supplier sourcing access certification pricing component R&D and performance evaluation to integration. Changan has the SRM system and work with suppliers through access certification VOC control prohibited and restricted substances management special supply requirements and other measures to improve environmental protection performance and encourage suppliers to save energy and cut emission for green and low-carbon development. We implemented the IATF16949 quality management system standards and the ISO14001 environmental certification with 98% of suppliers obtaining IATF16949 and 92% acquiring ISO14001.For the management of hazardous substances the system data is collected through CAMDS and fed into the ELV compliance system for comprehensive analysis and certifying. In this way Changan realizes the collection and control of automotive material data energy consumption and other information.Check “China Automotive Green Dismantling System” (http://www.cagds.org.cn) for Changan outlets for recycling scrapped vehicles. Companies to recycle or use dismantled vehicles can also log in on the CAGDS website or CAGDS system to see the manual of M1 passenger car dismantling. Users can check relevant information on the M1 vehicle disassembly manual through the WeChat mini program “Vehicle Disassembly Manual Identity Analysis Tool”.Power battery recycling service outlets can be checked on “Changan Automobile Official Website” (https://www.changan.com.cn).II. Social Responsibility The full text of corporate social responsibility report has been published on Juchao (www.cninfo.com.cn) on the same day as the annual report of the company was released.III. The Company Consolidated and Expanded the Achievements of Poverty Alleviation and Rural Revitalization Our company has deeply studied general Secretary Xi's spirit of helping and supporting work and fully implement the party central committee and the State Council designated to help support the decision deployment helping to carry out the government designated work arrangements to advance to consolidate and expand the crucial poverty results and country to promote the effective connection work to implement the political responsibility and social responsibility. 1. Strengthened organizational leadership We held 11 meetings among senior company leaders for support for targeted poor areas to decide on key programs study the plans line out measures and speed up the work. Changan leaders visited Yunnan for research and guidance. 2. Guaranteed funds for assistance Changan had pooled 10.6 million yuan for assistance including 4.5 million yuan for Luxi County in Yunnan and 6 million yuan for Yanshan County in Yunnan to support the comprehensive revitalization of rural industries talents culture ecology and organization in these two counties. Our purpose is to drive the development of rural industries improve the local ecosystem make local culture 64Chongqing Changan Automobile Company Limited 2022 Annual Report more civilized and improve people’s well-being with more effective governance. 3. Support for innovative industries 1. Youyang Camellia Oil Project In line with the government's overall plan for rural revitalization Changan has continued to carry forward the Youyang Camellia Oil Project from the three aspects of marketing brand and systems. First we helped with the marketing and channels of the project.Through our own sales channels we helped Youzhou Oil and Tea Technology Co. Ltd. achieve sales of 32.68 million yuan with annual sales exceeding 126 million yuan top ten in the country.Second we helped the Youzhou company establish digital M&S by leveraging new media channels and resources such as Douyin.The company achieved 363 million reads on social media. Changan’s influence in new models of public welfare working with other industries also expanded as a good example of enterprises undertaking social responsibilities.Third building the operation and management system. Changan helped the company establish a long-term mechanism of scientific management. In 2022 50000 rural households and nearly 200000 people benefited of which 5313 households and 18595 people were lifted out of poverty. 2. Chongqing Tanmeizi Project We have done deep research on the support plan for the special case of Chongqing Tanmeizi. By encouraging employees to buy introducing catering suppliers for group buying and making the products prizes for membership points in the Changan Shop Chongqing Tanmeizi achieved chili sales of 92000 yuan. 4. Scale up assistance through consumption In line with the government’s call Changan encourages employees to directly purchase products from the targeted rural area and we participated in the “Week of Consumption for Rural Area Products through SOEs under Central Government”. Changa supported the consumption of 2.376 million yuan throughout the year and drove industry development and income increase in poverty alleviation areas with concrete actions. 5. Promote employment assistanceLeveraging its advantages as an automobile manufacturer Changan has made skill training the focus and set up 8 “ChanganAutomobile Classes” in Luxi County and Yanshan County in Yunnan Province and Youyang County in Chongqing City. We carried out 3 expert lectures on campus and 3 rounds of recruitment at targeted areas. A total of 405 students and residents were recruited to promote the employment of the rural labor force and help increase the income of people from rural areas. We deepened cooperation with schools and drove the Luxi Automobile Training Base Project in Yunnan to make good use of existing resources and maximize the effects and efficiency of the training base. 6. Improve communications Under the title of “A Dreams in Youyang” Changan’s case for rural vitalization was named the “Outstanding Cases of RuralRevitalization of Listed Companies”. Our Youyang Camellia Oil Project showed excellent results and the project team for supporting targeted rural areas was awarded the title of “Worker Pioneer” by the Chongqing Federation of Trade Unions. 65Chongqing Changan Automobile Company Limited 2022 Annual Report Chapter 6 Important Matters I. Undertaking performance 1. Undertakings completed during the reporting period and yet to be performed as of the end of the reporting period of the company’s actual controllers shareholders related-parties acquirers and the company’s related parties of the undertakings.√ Applicable □Not applicable Undertakings Undertaking party Type of undertaking Description Date Duration Performance The shares of Changan China South Industries Group Automobile subscribed through Undertakings Co. Ltd.; China Changan Sales this offering shall not be made at the IPO Automobile Group Co. Ltd.; restrictions for transferred in any way within 36 In normal or refinancing Southern Industry Asset shares months after the offering October 2020 36 Months progress Management Co. Ltd. including but not limited to public transfer through the securities market or by agreement.Whether the promise is fulfilled as Yes scheduled 2. Explanation on whether assets or projects reach the earnings forecast and reasons when there is earning forecast for asset or projects and the reporting period is within the forecast period.□ Applicable √ Not applicable II. Non-operating funds the listed company occupied by controlling shareholders and their related parties □ Applicable √ Not applicable During the reporting period there was no non-operating funds of the listed company occupied by the controlling shareholder and related parties.III. Irregular external guarantee □ Applicable √ Not applicable The Company has no irregular external guarantee during the reporting period.IV. Explanation of the Board of Directors on the latest “Non-standard Audit Report” □ Applicable √ Not applicable V. Explanation of the “Non-Standard Audit Report” issued by the accounting firm during the reporting period by the BOD BOS and independent directors (if any) □ Applicable √ Not applicable 66Chongqing Changan Automobile Company Limited 2022 Annual Report VI. Explanation of changes in accounting policies accounting estimates and remedies for significant accounting errors □ Applicable √ Not applicable VII. Explanation of changes in the consolidated statement scope compared to the last annual report √ Applicable □ Not applicable During the reporting period Avatr completed a capital increase and equity expansion to introduce new investors. After this capital increase the company lost control of Avatr and no longer included it in the company's consolidated financial statements. As of the end of the reporting period the company holds 40.99% equity in Avatr. Changan Brazil Holdings Co. Ltd. has completed its deregistration and will no longer be included in the company's consolidated financial statements.VIII. Appointment and dismissal of the accounting firm The appointed accounting firm The name of the domestic accounting firm Ernst & Young Hua Ming LLP (Special General Partnership) Payment (RMB: 10000) 395 Years of audit services 16 Names of Certified Public Accountants Qiao Chun Yuan Yong Years of services provided by Certified Public Accountants （5 years）Qiao Chun （2 years）Yuan Yong Whether to re-appoint the accounting firms □Yes √ No Description of the internal control accounting firms financial adviser or sponsor √Applicable □ Not applicable After deliberation at the 2021 annual general meeting the company has appointed Ernst & Young Hua ming LLP (special general partnership) as the internal control auditor in 2022. In 2022 the company paid Ernst & Young Hua ming LLP (special general partnership) RMB 1.166 million for the internal control audit services.IX. Delisting after the disclosure of the annual report □ Applicable √ Not applicable X. Bankruptcy and restructuring □ Applicable √ Not applicable During the report period there is no bankruptcy or restructuring.XI. Crucial litigation and arbitration □ Applicable √ Not applicable During the reporting period the company has no crucial litigation and arbitration.XII. Punishment and rectification □ Applicable √ Not applicable During the reporting period there’s no punishment and rectification..XIII. The integrity of company its controlling shareholder and actual controller □ Applicable √ Not applicable 67Chongqing Changan Automobile Company Limited 2022 Annual Report XIV. Significant related-party transactions 1. Related-party transactions related to daily operation For details please refer to Note 10 “Related Party Relationships and Transactions” under the Chapter 10. 2. Related-party transactions of acquisition or sales of assets or equity □ Applicable √ Not applicable 3. Related-party transactions of common foreign investment √ Applicable □ Not applicable For details please refer to “XIV. 7. Other significant related-party transactions” in Chapter 6. 4. Related rights and debt relations √Applicable □Not applicable For details please refer to Note 10 "Related Party Relationships and Transactions" under the Chapter 10.Whether there is any non-business related credits and debts □Yes √ No There is no non-operating associated credits and debts during the reporting period. 5. Transactions with associated financial companies √ Applicable □Not applicable Deposit Amount incurred in the current Maximum period Related party Relationship daily deposit Beginning limit (RMB: Interest rate balance (RMB: Total deposit Total Ending balance 10000) amount (RMB: withdrawal (RMB: 10000) 10000) 10000) amount (RMB: 10000) A company China South controlled by Industries the actual Group Finance controller of 2000000 0.35%-2.1% 1965298 33811595 33790598 1986295 Co. Ltd. Changan Automobile A company Changan controlled by Automobile the actual Financing Co. controller of 1500000 1.85%-3.50% 1200000 1495000 1200000 1495000 Ltd. Changan Automobile Loan Amount incurred in the current Beginning period Related party Relationship Loan amount (RMB: 10000) Interest rate balance (RMB: Total amount Total Ending balance 10000) of loan (RMB: repayment (RMB: 10000) 10000) amount (RMB: 10000) A company China South controlled by Industries the actual Group Finance controller of 50000 1%-4.75% 7330 8707 9137 6900 Co. Ltd. Changan Automobile Credit granting or other financial business Related party Relationship Business Total amount (RMB: Actual amount incurred 68Chongqing Changan Automobile Company Limited 2022 Annual Report 10000) (RMB: 10000) China South Industries A company controlled by Group Finance Co. Ltd. the actual controller of Credit granting 1150000 523164 Changan Automobile 6. Transactions between the financial company controlled by the company and related parties □ Applicable √ Not applicable 7. Other significant related-party transactions √ Applicable □Not applicable Interim announcement of major related-party transactions on the website Interim announcement Interim announcement date Wsebsite Announcement of Expected Related-party Transactions in the Ordinary Course of 2022 April 28th 2022 Announcement on Related-party Transactions of China South Industries Group Finance Co. Ltd. Providing Financial Services for Changan Automobile May 21st 2022 Announcement on Related-party Transactions of Changan Automobile Finance http://www.cninfo.com.cn Co. Ltd. Providing Financial Services for Changan Automobile May 21st 2022 Announcement on Related Transactions of Capital Increase to Associated Enterprises August 3rd 2022 XV. Major contracts and their performance 1. Custody contracting and leasing （1）Custody □ Applicable √ Not applicable Custody information There is no custody during the reporting period. （2）Contracting □ Applicable √ Not applicable Contracting information There is no contracting during the reporting period. （3）Leasing √ Applicable □Not applicable Leasing information Leasing of related parties can be found in Item 5 (3) of Note 10 of Financial Statements “Related Party and Related Transactions”.Projects whose profit and loss to the company account for more than 10% of total profits during the reporting period.□ Applicable √ Not applicable There was no project whose profit and loss to the company accounted for more than 10% of total profits during the reporting period. 2. Guarantee □ Applicable √ Not applicable There’s no guarantee during the report period. 69Chongqing Changan Automobile Company Limited 2022 Annual Report 3. Entrustment of cash asset management (1) Entrust wealth management □ Applicable √ Not applicable There’s no entrusting wealth management during the reporting period. (2) Entrusted loans □ Applicable √ Not applicable There is no entrusted loan during the reporting period. 4. Other major contracts □ Applicable √ Not applicable There are no other major contracts of the Company during the reporting period.XVI. Other important events √ Applicable □ Not applicable On December 2 2022 and December 22 2022 respectively the company held the forty-ninth meeting of the eighth board ofdirectors and the fourth Extraordinary General Meeting in 2022 to review the “motion on the acquisition of part of Changan NewEnergy”. After the completion of this transaction the company’s shareholding ratio in Changan New Energy will increase from 40.66 %to 51.00%. Changan New Energy will be included in the company’s consolidated statements. For details see “Announcement on theacquisition of part of Changan New Energy” (Announcement No. 2022-78). On February 18 2023 the company disclosed “Announcement on the progress of the acquisition of part of Changan New Energy” (Announcement No.2023-05). Changan New Energy has been included in the company’s consolidated statements since February 2023.XVII. Important matters of the Company’s subsidiary □ Applicable √ Not applicable 70Chongqing Changan Automobile Company Limited 2022 Annual Report Chapter 7 Share Changes and Shareholder Information Ⅰ. Change in shareholdings 1. Change in shareholdings Unit: One share Before change Changes（+，-） After changeQuantity Ratio Additional Stock Provident fund issued dividend transfer Other Subtotal Quantity Ratio Shares with sales restrictions 519818865 6.81% 155945659 10950 155956609 675775474 6.81% 1. State-owned legal person shares 396393645 5.19% 118918093 118918093 515311738 5.19% 2. Other domestic shares 122490320 1.61% 36747096 10950 36758046 159248366 1.61% Including: domestic legal person shares domestic natural person shares 122490320 1.61% 36747096 10950 36758046 159248366 1.61% 3. Foreign shares 934900 0.01% 280470 280470 1215370 0.01% Including: foreign legal persons shares foreign natural person shares 934900 0.01% 280470 280470 1215370 0.01% Shares without sales restrictions 7112334537 93.19% 2133700361 -10950 2133689411 9246023948 93.19% 1.Ordinary shares denominated in RMB 5849553939 76.64% 1754866182 -10950 1754855232 7604409171 76.64% 2. Domestic listed foreign shares 1262780598 16.55% 378834179 378834179 1641614777 16.55% Total shares 7632153402 100.00% 2289646020 2 289646020 9921799422 100.00% Reasons for share change √ Applicable □ Not applicable The company implemented the 2021 annual equity distribution (see the "Announcement on the Implementation of 2021 Annual Dividend Distribution and Capital Share Increase by Transfer" for more information). The distribution plan went: based on the total capital share of 7632153402 distribute RMB 2.33 for each10 shares Cash (tax included) to all shareholders and increase by transferring 3 shares for each 10 shares to all shareholders by capital reserve. The ex-dividend date is June 27 2022 and the total number of capital share was 9921799422 after the transfer.Other changes in the company’s limited sales conditions shares are caused by changes in lock-up stocks for retired executives.Approval of share change √ Applicable □ Not applicable 2021 annual equity distribution was reviewed and approved by the 38th meeting of the 8th Session of Board of Directors on April 26 2022 and was reviewed and approved by the company’s 2021 annual general meeting of shareholders on June 15 2022. Transfer of shares √ Applicable □ Not applicable See Chapter 7 I 1 "Reasons for share change" for details.Impact of share changes on financial indicators such as basic earnings per share and diluted earnings per share in the latest year and the latest period and net assets per share attributable to ordinary shareholders of the company √ Applicable □ Not applicable The basic earnings per share at the beginning of the reporting period was RMB 0.36 yuan and at the end RMB 0.80 yuan; the diluted earnings per share at the beginning of the reporting period was RMB 0.36 yuan and at the end was RMB 0.78 yuan; the net assets per share attributable to ordinary shareholders at the beginning were RMB 7.30 yuan and at the end RMB 6.34 yuan.Other information deemed necessary by the company or required by securities regulators to disclose □ Applicable √ Not applicable 71Chongqing Changan Automobile Company Limited 2022 Annual Report 2. Changes in restricted shares √ Applicable □ Not applicable Unit: share(s) Number of Number of Increase during shares with sales Number of Name of shareholders restricted shares at the reporting restriction restricted shares at Reasons for Date of removal of sales the beginning of period removed during the end of the restrictions restriction the period the reporting period period Southern Industry Asset 261682243 78504673 - 340186916 Non-public issuance Management Co. Ltd. of A shares in 2020 2023-10-26 China Changan Automobile Group Co. Ltd. 130841122 39252336 - 170093458 Non-public issuance of A shares in 2020 2023-10-26 China South Industries Group 3870280 1161084 - 5031364 Non-public issuance Co. Ltd. of A shares in 2020 2023-10-26 The restricted stock granted by the incentive object for the first time and reserved for the restricted stock is released in three batches.The restriction period of each batch is 24 months A-share restricted stock 123398760 37019628 - 160418388 Equity incentive 36 months and 48 months from the date of completion of the corresponding grant registration. The proportion of lifting the restriction is 33 % 33 % and 34 % of the total number of shares granted by the incentive object.Locked shares of senior executives Lift the sale restriction Other shareholders 26460 18888 - 45348 and outgoing according to the relevant executives other than rules Restricted stock Total 519818865 155956609 - 675775474 -- -- Note: The above "Increase during the reporting period" has been adjusted according to the implementation of the company's 2021 equity distribution plan which is subject to the registration of China Securities Depository and Clearing Corporation Limited Shenzhen Branch.II. Issuing and listing of securities 1. Securities issuance (excluding preference shares) during the reporting period √ Applicable □ Not applicable Unit: RMB Name of the Price (or Number share and its approved of Closing Disclosure derivative Date interest Number Listing date rate) listing and date of Disclosure information securities trading trading date Convertible corporate bonds separate transaction convertible corporate bonds corporate bonds For details please see the " Chongqing Changan Automobile Co. Ltd.in 2022 22 Changan December December December for Professional Investors to Publicly December K1 19th 2022 3.00% 1000000000 26th 2022 1000000000 20th 2027 Issued Scientific and Technological Innovation Corporate Bonds ( Phase I ) 15th 2022 Issuance Announcement " on http://www.cninfo.com.cn Explanation on the issuance of securities (excluding preferred shares) during the reporting period On December 19 2022 the company publicly issued the technology innovation company bonds (Phase I ) to professional investors with the issuance scale of RMB 1000000000 yuan the bond issuance period of 5 years and the bond coupon rate of 3.00%. It was listed and traded on the Shenzhen Stock Exchange on December 26 2022. 72Chongqing Changan Automobile Company Limited 2022 Annual Report 2. Changes in the company’s total shares and shareholding structure and changes in the company's asset and liability structure √ Applicable □ Not applicable Please see Chapter 7 I 1 “Reasons for share change” for the changes in the total number of ordinary shares and shareholder structure of the Company during the reporting period.At the beginning of the reporting period the total assets were RMB 135404623479.63; the total liabilities were RMB 79538383535.43 and the asset-liability ratio was 58.74%. At the end of the period the total assets were RMB 146048555951.92 the total liabilities were RMB 83099751390.43 and the asset-liability ratio was 56.90%. 3. Existing employee shares □ Applicable √ Not applicable III. Shareholders and actual controllers 1. Number of shareholders and shareholding Unit: share(s) Number of Number of ordinary shareholders Number of shareholders shareholders holding preference holding preference shares At the end of the report period the at the month- shares with with restored voting total number of shareholders 731125 end prior 736208 restored voting 0 rights at the month-end 0 to the rights at the end of prior to the disclosure disclosure date the reporting date of this Report of this Report period Shareholders holding more than 5% of the shares or top 10 shareholders Number of Increase/ Number of Number of Condition of Name Nature Percentag shares held as of decrease shares (pledged e the end of the during the shares held shares held with sales without sales labeled or frozen) reporting period Reporting Period restrictions restrictions Status Amoun t China Changan Automobile Group State-owned legal Co. Ltd. person 17.97% 1783090143 411482340 170093458 1612996685 China South Industries Group Co. State-owned legal Ltd. person 14.22% 1410747155 285364756 5031364 1405715791 Southern Industry Asset Management State-owned legal Co. Ltd. person 5.10% 506243257 49175367 340186916 166056341 China Securities Finance Co. Ltd. Domestic general legal person 4.30% 426362905 98391439 426362905 United Prosperity Investment Co. Ltd. Foreign legal person 2.83% 280498832 64730500 280498832 Not Hong Kong Securities Clearing Co.Ltd. Foreign legal person 1.44% 143126909 -97559531 143126909 pledged labeled or China Construction Bank Corporation Funds wealth frozen - Huaxia Energy Reform Equity management 0.72% 71921430 16048986 71921430 Securities Investment Fund products etc.GUOTAI JUNAN SECURITIES HONG KONG LIMITED Foreign legal person 0.43% 42682415 12517977 42682415 （ ） China Merchants Securities (HK) Co.Ltd. Foreign legal person 0.40% 39905619 39905619 39905619 Taiping Life Insurance Co. Ltd. State-owned legal person 0.35% 34742116 34742116 34742116 Among the top 10 shareholders the actual controller China South Industries Group Co. Ltd. and its Description of the related party relationship or acting in wholly-owned subsidiary Southern Industry Asset Management Co. Ltd. the controlling shareholderconcert among the above shareholders China Changan Automobile Group Co. Ltd. and its wholly-owned subsidiary United Prosperity Investment Co. Ltd. are parties acting in concert by “Measures for the Administration of Takeover ofListed Companies”.Description of the above-mentioned shareholders entrusting/being entrusted with voting rights and waiver of None voting rights Shareholdings of the top 10 ordinary shareholders of unrestricted shares Number of shares without sales Shares type Shareholders restrictions at the end of the reporting period Type Number China Changan Automobile Group Co. Ltd. 1612996685 RMB ordinary shares 1612996685 China South Industries Group Co. Ltd. 1405715791 RMB ordinary shares 1405715791 73Chongqing Changan Automobile Company Limited 2022 Annual Report China Securities Finance Co. Ltd. 426362905 RMB ordinary shares 426362905 United Prosperity Investment Co. Limited 280498832 Domestic listed foreign shares 280498832 Southern Industry Asset Management Co. Ltd. 166056341 RMB ordinary shares 166056341 Hong Kong Securities Clearing Co. Ltd. 143126909 RMB ordinary shares 143126909 China Construction Bank Corporation - Huaxia Energy Reform Equity Securities Investment Fund 71921430 RMB ordinary shares 71921430 GUOTAI JUNAN SECURITIES（HONG KONG） LIMITED 42682415 Domestic listed foreign shares 42682415 China Merchants Securities (HK) Co. Ltd. 39905619 Domestic listed foreign shares 39905619 Taiping Life Insurance Co. Ltd. 34742116 RMB ordinary shares 34742116 Description of the related relationship or acting in concert Among the top 10 shareholders the actual controller China South Industries Group Co. Ltd. and its among the top 10 shareholders of unrestricted circulating wholly-owned subsidiary Southern Industry Asset Management Co. Ltd. the controlling shareholder shares and between the top 10 shareholders of unrestricted China Changan Automobile Group Co. Ltd. and its wholly-owned subsidiary United Prosperity tradable shares and the top 10 shareholders Investment Co. Ltd. are parties acting in concert as stipulated in the “Measures for the Administration of Takeover of Listed Companies”.Whether the top 10 shareholders of ordinary shares and the top 10 shareholders of ordinary shares without sales restrictions agreed on the repurchase transactions during the report period □ Yes √ No The top 10 shareholders of ordinary shares and the top 10 shareholders of ordinary shares without sales restrictions did not agree on the repurchase transactions during the reporting period. 2. The company's controlling shareholder Nature of the controlling shareholder: the central state-owned Type of the controlling shareholder: legal person Name Legal /Representative Date of establishment Organization code Business scope and major products: Design development manufacturing and sales of car motorcycle and engine and parts; sales of optical products electronic and optoelectronic products night vision device China Changan Automobile 91110000710933948 information and communication equipment; technical Group Co. Ltd. Zhou Kaiquan Dec 26th 2005 4 development transfer consultation technical training and other technical service related to the operation mentioned above; imports and exports; merge and acquisition and asset restructuring consultation; telecommunications services and agency bookkeeping.Equity of other domestic and overseas listed As of the end of the reporting period controlling shares of listed companies: Harbin Dongan Auto Engine Co. Ltd.companies where he has (stock code 600178); Hunan Tianyan Machinery Co. Ltd. (stock code 600698) Chongqing Changan Minsheng APLL controlled and participated Logistics Co. Ltd (stock code 01292.HK) during the reporting period The change of controlling shareholder during the reporting period □ Applicable √ Not applicable No changes in controlling shareholder during the reporting period. 3. The actual controller and its parties acting in concert Nature of the actual controller: the central state-owned asset management institution Type of the actual controller: legal person Name Legal Representative Date of establishment Organization code Businesses Investment and management of state-owned assets operation and management R&D manufacturing guarantee and services of vehicles electrical equipment China South Industries optoelectronic information products and equipment Group Corp. Xu Xianping Jun 29th1999 9111000071092604 3F mechanical equipment engineering and construction machinery chemical materials (except hazardous chemicals) fire-fighting equipment medical and environmental protection equipment metal and non-metal materials and products.Other domestic and As of the end of the reporting period directly or indirectly controlling shares of listed companies: Harbin Dongan Auto overseas listed companies Engine Co. Ltd. (stock code 600178); Baoding Tianwei Electric Co. Ltd. (stock code 600550); Jiangling Motors Co.controlled by the actual Ltd. (stock code 000550); Hunan Tianyan Machinery Co. Ltd. (stock code 600698); Chongqing Jianshe Automotive controller during the report Systems Co. Ltd. (stock code 200054); China Optical Group Co. Ltd. (stock code 002189); Yunnan Xiyi Industrial Co.period Ltd. (stock code 002265); Chongqing Changan Minsheng APLL Logistics Co. Ltd. (stock code 01292.HK); Hubei Huaqiang Technology Co. Ltd. (stock code 688151).The change of the actual controller during the reporting period □ Applicable √ Not applicable 74Chongqing Changan Automobile Company Limited 2022 Annual Report No changes in the actual controller during the reporting period.The equity and control relationship between the company and the actual controller: Actual controlling through trust or other asset management.□ Applicable √ Not applicable 4. Pledged shares held by controlling shareholder or the largest shareholder and its parties acting in concert account for 80% of the shares.□ Applicable √ Not applicable 5. Other corporate shareholders holding over 10% shares. □ Applicable √ Not applicable 6. Shareholding restriction and reduction of controlling shareholder actual controller restructuring party and other commitment entities □ Applicable √ Not applicable IV. Share repurchase during the reporting period Share repurchase □ Applicable √ Not applicable Reducing repurchased shares by centralized bidding □ Applicable √ Not applicable 75Chongqing Changan Automobile Company Limited 2022 Annual Report Chapter 8 Preference Shares □ Applicable √ Not applicable There was no preferred share in the Company in the reporting period. 76Chongqing Changan Automobile Company Limited 2022 Annual Report Chapter 9 Bonds √Applicable □ Not applicable I. Enterprise Bonds □Applicable √ Not applicable No enterprise bonds in the Reporting Period II. Corporate Bonds √Applicable □ Not applicable 1. Basic Information of the Corporate Bonds Unit: RMB Abbreviati Bond Date of Value Maturi Interes Trading Bond Name Bonds balance Way of redemption on Code issue date ty t rate place Chongqing Single interest is Changan calculated on an annual Automobile Co.basis excluding Ltd. publicly Dece Dece Dece compound interest. The issued science 22 Shenzhen 148147. mber mber mber interest is paid once a and technology Changan 1000000000 3.00% Stock SZ 19th 20th 20th year and the principal is innovation K1 Exchange 2022 2022 2027 repaid once due. The last corporate bonds interest is paid with the to professional payment of the investors in principal. 2022 ( Phase I ) This bond is issued to professional institutional investors who open A-share securities accounts Appropriate arrangement of the investors in Shenzhen Branch of China Securities Depository and Clearing Co. Ltd. (excluding purchasers (if any) prohibited by laws and regulations).Applicable trading mechanism Centralized bidding trade and block trading Risk of termination of listing transactions None (if any) and countermeasures Overdue bonds □ Applicable √ Not applicable 2. The Trigger and Execution of the Option Clause of the Issuers or Investors and the Investor Protection Clause □Applicable √ Not applicable 3. Intermediary Signature Contact person of Bond Intermediary Office address Contact number accountant intermediary Chongqing Lead underwriter 22nd Floor CITIC Securities Hu Yan Changan and bond trustee: Building No. 48 Liangmaqiao Jiang Haotian Qiao Chun 010-60837490 Automobile CITIC Securities Road Chaoyang District Jiang jiarong Yuan Yong Co. Ltd. Co. Ltd. Beijing 77Chongqing Changan Automobile Company Limited 2022 Annual Report publicly issued Joint lead 27th and 28th Floors Block 2 science and underwriter: China Guomao Building No. 1 Qi Qin Yan 010-65051166 technology International Capital Jianguomenwai Street Runan Li Cong innovation Corporation Limited Chaoyang District Beijing corporate Floor 8-10 Building A bonds to Law Firm: Beijing Rongchao Business Center professional ZhongLun Law Xu Zhigang 0755-33256902 6003 Yitian Road Futian investors in Firm District Shenzhen 2022 (Phase I ) Accounting firm: 17th Floor Ernst & Young Ernst & Young Hua Tower Oriental Plaza No. 1 Qiao Chun Yuan 023-62736177 Ming LLP (Special East Chang An Avenue Dong Yong General Partnership) Cheng District Beijing China 17th Floor PICC Rating agency: Property&Casualty Insurance Sun Changzheng United Credit Building No. 2 010-85679696 Li Jingyun Rating Co. Ltd. Jianguomenwai Street Chaoyang District Beijing Indicate by tick mark whether above intermediary changed in the Reporting Period □ Yes √ No 4. List of the Usage of the Raised Funds Unit: RMB Whether is consistent Rectification of Operation of with the usage using Unused raised funds for Bond Total amount Amount spent special account plan and other amount violation for raised funds agreements stipulated in operation the raising specification Chongqing Changan Automobile Co. Ltd. Relevant special publicly issued science accounts for and technology raised funds are No illegal use 1000000000 1000000000 0 Yes innovation corporate used normally of raised funds bonds to professional according to investors in 2022 regulations ( Phase I ) The raised funds were used for project construction □ Applicable √ Not applicable The Company changed the usage of above funds raised from bonds during the Reporting Period.□ Applicable √ Not applicable 5. Adjustment of Credit Rating Results during the Reporting Period □ Applicable √ Not applicable 6. Execution and Changes of Guarantee Repayment Plan and Other Repayment Guarantee Measures as well as Influence on Equity of Bond Investors during the Reporting Period □ Applicable √ Not applicable III. Debt Financing Instruments of Non-financial Enterprises □ Applicable √ Not applicable No such cases in the Reporting Period. 78Chongqing Changan Automobile Company Limited 2022 Annual Report IV. Convertible Corporate Bonds □ Applicable √ Not applicable No such cases in the Reporting Period.V. Losses of Scope of Consolidated Financial Statements during the Reporting Period Exceeding 10% of Net Assets up the Period-end of Last Year □ Applicable √ Not applicable VI. Matured Interest-bearing Debt excluding Bonds up the Period-end □ Applicable √ Not applicable VII. Whether there was any Violation of Rules and Regulations during the Reporting Period □ Yes √ No VIII. The Major Accounting Data and the Financial Indicators of the Recent 2 Years of the Company up the Period-end Unit: 10000 RMB Items 31 December 2022 31 December 2021 Increase/decrease Current ratio 1.28 1.20 6.67% Debt/asset ratio 56.90% 58.74% -1.84% Quick ratio 1.18 1.03 14.56% 31 December 2022 31 December 2021 Increase/decrease Net profit after deducting 445891.93 165277.13 169.78% non-recurring profit or loss Debt/EBITDA ratio 46.48% 39.59% 6.89% Interest cover (times) 137.44 67.31 104.19% Cash-to-interest cover (times) 116.39 508.67 -77.12% EBITDA-to-interest cover 793.45697.2313.80% (times) Loan repayment rate 100% 100% 0 Interest coverage 100% 100% 0 79Chongqing Changan Automobile Company Limited 2022 Annual Report Chapter 10 Auditor’s Report Ernst & Young Hua Ming Shen Zi (2023) No. 60662431_V01 Chongqing Changan Automobile Company Limited To the shareholders of Chongqing Changan Automobile Company Limited 80Auditor’s Report Ernst & Young Hua Ming Shen Zi (2023) No. 60662431_V01 Chongqing Changan Automobile Company Limited To the shareholders of Chongqing Changan Automobile Company Limited: Opinion We have audited the accompanying financial statements of Chongqing Changan Automobile Company Limited which comprise the consolidated and the company balance sheet as at 31 December 2022 and the consolidated and the company income statements the statements of changes in equity and the cash flow statements for the year then ended and notes to the financial statements.In our opinion the accompanying financial statements of Chongqing Changan Automobile Company Limited present fairly in all material respects the consolidated and the Company’s financial position as at 31 December 2022 and the consolidated and the Company’s financial performance and cash flows for the year then ended in accordance with Accounting Standards for Business Enterprises (“ASBEs”).Basis for opinion We conducted our audit in accordance with China Standards on Auditing (“CSAs”). Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the Company in accordance with China Code of Ethics for Certified Public Accountants (the “Code”) and we have fulfilled our other ethical responsibilities in accordance with the Code.We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.Key audit matters Key audit matters are those matters that in our professional judgement were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole and in forming our opinion thereon and we do not provide a separate opinion on these matters. For each matter below our description of how our audit addressed the matter is provided in that context. 81Auditor’s Report (continued) Ernst & Young Hua Ming Shen Zi (2023) No. 60662431_V01 Chongqing Changan Automobile Company Limited Key audit matters (continued) We have fulfilled the responsibilities described in the Auditor’s responsibilities for the audit of the financial statements section of our report including in relation to these matters.Accordingly our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the financial statements. The results of our audit procedures including the procedures performed to address the matters below provide the basis for our audit opinion on the accompanying financial statements.Key audit matter How our audit addressed the key audit matter Provision for warranties According to after-sales maintenance contracts or With regard to the warranty provisions related national laws and regulations Chongqing audited by us: Changan Automobile Company Limited provides warranties on automobile and undertakes to repair * We understood and evaluated or replace items that fail to perform satisfactorily the process of the warranty based on certain pre-determined conditions. In provisions. In addition we tested addition in order to maintain the quality and safety the key controls and application of the sold vehicle Chongqing Changan Automobile controls over the process of the Company Limited also promotes a recall based on warranty provisions.needs. Chongqing Changan Automobile Company Limited should estimate and recognize the warranty * We assessed the reasonableness costs and the corresponding liabilities. and evaluated the major assumptions of management’s Provisions for warranties granted by Chongqing warranty provision models. We Changan Automobile Company Limited for the tested the samples of payment of vehicles sold are recognized based on sales volume the warranty provisions and tested and past experience of the cost of repair and the mathematical accuracy of replacement and labor cost which involves a calculations therein by re- number of assumptions and judgments. Extra performing the calculations recalls are recognized based on the vehicles regarding the balance of the involved and the estimated average cost of repair provisions.and replacement and labor cost which involves a number of assumptions and judgments. Any * We reviewed the adequacy of increase or decrease in the provision would have a disclosures in the financial significant impact on the financial statements. statements.Refer to Note III 23 33 and Note V 28 of the consolidated financial statements for the disclosures of the provision for warranties. 82Auditor’s Report (continued) Ernst & Young Hua Ming Shen Zi (2023) No. 60662431_V01 Chongqing Changan Automobile Company Limited Key audit matters (continued) Key audit matter How our audit addressed the key audit matter Capitalization of internal development costs The research and development activities With regard to the capitalization of internal launched by Chongqing Changan Automobile development costs audited by us: Company Limited mainly include technology development product process design and * We understood evaluated and product manufacturing process design. validated the key controls over the Management capitalized the costs on capitalization of internal development development projects met the criteria set out in costs.the accounting standard for capitalization.* We assessed the criteria set by the The expenditures in development stage are management related to the capitalized that should meet all the conditions capitalization of the costs under including technically feasible use or sale development stage. We assessed intention market finance resources and etc. the accuracy of the start point and the The judgment should be made according to stop point for capitalization of internal every project and agreed by all related development costs. We also tested departments. In addition for projects that samples of projects to review the have been capitalized in the past the judgment feasibility reports and other reports for whether the expenditures in development can important stages.be continuing capitalized should be made according the latest progress and future * We reviewed the adequacy of expectations of the project. The judgment disclosures in the financial statements.made by the management would have a significant impact on the financial statements.Refer to Note III 18 33 and Note V 17 of the consolidated financial statements for the disclosures of capitalization of internal development costs. 83Auditor’s Report (continued) Ernst & Young Hua Ming Shen Zi (2023) No. 60662431_V01 Chongqing Changan Automobile Company Limited Other information The management of the Chongqing Changan Automobile Company Limited (the “Management”) is responsible for the other information. The other information comprises the information included in the annual report other than the financial statements and our auditor’s report thereon.Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.In connection with our audit of the financial statements our responsibility is to read the other information and in doing so consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated.If based on the work we have performed we conclude that there is a material misstatement of this other information we are required to report that fact. We have nothing to report in this regard.Management’s and governance’ responsibility for the financial statements The Management is responsible for the preparation and fair presentation of these financial statements in accordance with ASBEs and for designing implementing and maintaining such internal control as the management determines is necessary to enable the preparation of financial statements that are free from material misstatement whether due to fraud or error.In preparing the financial statements the Management is responsible for assessing the Company’s ability to continue as a going concern disclosing as applicable matters related to going concern and using the going concern basis of accounting unless the management either intends to liquidate the Company or to cease operations or has no realistic alternative but to do so.Those charged with governance are responsible for overseeing the Company’s financial reporting process. 84Auditor’s Report (continued) Ernst & Young Hua Ming Shen Zi (2023) No. 60662431_V01 Chongqing Changan Automobile Company Limited Auditor’s responsibilities for the audit of the financial statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement whether due to fraud or error and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with CSAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are generally considered material if individually or in the aggregate they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.As part of an audit in accordance with CSAs we exercise professional judgement and maintain professional skepticism throughout the audit. We also: (1) Identify and assess the risks of material misstatement of the financial statements whether due to fraud or error design and perform audit procedures responsive to those risks and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error as fraud may involve collusion forgery intentional omissions misrepresentations or the override of internal control. (2) Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. (3) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the management. (4) Conclude on the appropriateness of the management’s use of the going concern basis of accounting and based on the audit evidence obtained whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or if such disclosures are inadequate to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However future events or conditions may cause the Company to cease to continue as a going concern. (5) Evaluate the overall presentation including the disclosures structure and content of the financial statements and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. 85Auditor’s Report (continued) Ernst & Young Hua Ming Shen Zi (2023) No. 60662431_V01 Chongqing Changan Automobile Company Limited Auditor’s responsibilities for the audit of the financial statements (continued) (6) Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Company to express an opinion on the financial statements. We are responsible for the direction supervision and performance of the Group audit. We remain solely responsible for our audit opinion.We communicate with those charged with governance regarding among other matters the planned scope and timing of the audit and significant audit findings including any significant deficiencies in internal control that we identify during our audit.We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence and where applicable related safeguards.From the matters communicated with those charged with governance we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when in extremely rare circumstances we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.Qiao Chun Ernst & Young Hua Ming (LLP) Chinese Certified Public Accountant (Engagement partner) Yuan Yong Chinese Certified Public Accountant Beijing the People’s Republic of China 16 April 2023 86Chongqing Changan Automobile Company Limited CONSOLIDATED BALANCE SHEET 31 December 2022 (Expressed in Renminbi Yuan) Assets Notes V 2022/12/31 2021/12/31 Current assets Cash 1 53530183827.34 51976242149.37 Financial assets held for trading 2 280315571.09 195798300.00 Notes receivable 3 35849660652.96 24267633416.65 Accounts receivable 4 3068414415.29 1675427534.87 Prepayments 5 749572262.00 3241248831.28 Other receivables 6 1261157951.14 632122942.37 Inventories 7 5823307512.90 6852874420.59 Contract assets 8 458389187.10 1151292247.36 Other current assets 9 1054779668.19 1147798871.42 Total current assets 102075781048.01 91140438713.91 Non-current assets Long-term equity investments 10 14406662456.28 13245374860.55 Other equity instrument investment 11 489950000.00 701409600.00 Investment property 12 6422715.04 6649426.60 Fixed assets 13 19346764691.44 21325959850.16 Construction in progress 14 1387898218.64 1460176539.43 Right-of-use assets 15 100813386.01 66313062.98 Intangible assets 16 4446385255.68 4385997657.67 Development expenditure 17 723211177.47 727568248.78 Goodwill 18 9804394.00 48883188.37 Long-term deferred expenses 19 26375422.17 15032814.19 Deferred tax assets 20 3028487187.18 2280819516.99 Total non-current assets 43972774903.91 44264184765.72 TOTAL ASSETS 146048555951.92 135404623479.63 The notes form an integral part of the financial statements. 87Chongqing Changan Automobile Company Limited CONSOLIDATED BALANCE SHEET (continued) 31 December 2022 (Expressed in Renminbi Yuan) Notes V 2022/12/31 2021/12/31 Current liabilities Short-term loans 21 29000000.00 19000000.00 Notes payable 22 22072793864.83 24292268371.12 Account payable 23 29449664138.75 23650604870.98 Contract liabilities 24 5655256792.66 9840509514.39 Payroll payable 25 2807158489.85 2566570928.52 Tax payable 26 1749946082.32 1121313397.52 Other payables 27 6082766424.67 4562626344.69 Contingent liabilities 28 4589299321.49 3839015677.84 Non-current liabilities due within one year 29 885723901.34 533839583.57 Other current liabilities 30 6627044667.62 5680959029.22 Total current liabilities 79948653683.53 76106707717.85 Non-current liabilities Long-term loans 31 36000000.00 600000000.00 Bonds payable 32 999528301.88 - Lease Liabilities 33 60205397.98 38679735.59 Long-term account payable 34 553518750.12 825473490.08 Long term payroll payable 35 35013000.00 39103000.00 Deferred income 36 347568549.62 924749731.12 Deferred tax liabilities 20 237036741.16 217441992.37 Other non-current liabilities 37 882226966.14 786227868.42 Total non-current liabilities 3151097706.90 3431675817.58 Total liabilities 83099751390.43 79538383535.43 The notes form an integral part of the financial statements. 88Chongqing Changan Automobile Company Limited CONSOLIDATED BALANCE SHEET (continued) 31 December 2022 (Expressed in Renminbi Yuan) Notes V 2022/12/31 2021/12/31 Owners’ equity Share capital 38 9921799422.00 7632153402.00 Capital reserves 39 8532806685.77 9776193360.38 Less: treasury shares 40 627060416.52 655812327.60 Other comprehensive Income 41 98841615.42 69442469.53 Special reserves 42 24090898.05 27988260.61 Surplus reserves 43 3528137635.53 2982292413.67 Retained earnings 44 41379489865.45 35900674525.13 Equity attributable to owners 62858105705.70 55732932103.72 Minority interests 90698855.79 133307840.48 Total equity 62948804561.49 55866239944.20 TOTAL LIABILITIES AND OWNERS’ EQUITY 146048555951.92 135404623479.63 The financial statements have been signed by: Legal Principal in Charge Chief Representative: of Accountancy: Accountant: The notes form an integral part of the financial statements. 89Chongqing Changan Automobile Company Limited CONSOLIDATED INCOME STATEMENT Year ended 31 December 2022 (Expressed in Renminbi Yuan) Notes V 2022 2021 Operating revenue 45 121252864085.40 105141877237.05 Less: Operating cost 45 96409610873.76 87648705534.14 Tax and surcharges 46 4101847822.50 3972433040.45 Operating expenses 47 5138270162.95 4645654234.59 General and administrative expenses 48 3532458198.76 3499654508.49 Research and development expenses 49 4315444864.76 3515029178.76 Financial income 50 (1017305743.08) (780923197.18) Interest expense 48683490.36 45160385.56 Interest income 1014346758.69 868952893.13 Add: Other incomes 51 529819888.31 330174796.23 Investment income/(loss) 52 (768957070.79) 1013650091.28 Including: Investment income/(loss) from associates and joint venture (3060648491.82) 924827870.13 Earnings from fair value changes 53 3570229.29 42078804.00 Impairment loss of credit 54 (32242010.27) (23050864.57) Impairment loss on assets 55 (945853716.20) (1019254832.79) Gain on disposal of assets 56 74862481.00 745601530.26 Operating profit 7633737707.09 3730523462.21 Add: Non-operating income 57 128910416.79 130170270.12 Less: Non-operating expenses 58 54391039.79 40084896.60 Total profit 7708257084.09 3820608835.73 Less: Income tax expense 60 (36425271.88) 216390645.75 Net profit 7744682355.97 3604218189.98 Classification by going concern Net profit from continuing operations 7744682355.97 3604218189.98 Classification by ownership attribution Net profit attributable to owners 7798451093.72 3552463320.03 Minority interests (53768737.75) 51754869.95 The notes form an integral part of the financial statements. 90Chongqing Changan Automobile Company Limited CONSOLIDATED INCOME STATEMENT (continued) Year ended 31 December 2022 (Expressed in Renminbi Yuan) Notes V 2022 2021 Other comprehensive income net of tax Total comprehensive income attributable to owners net of tax 34464805.89 (8978251.25) Other comprehensive income not to be reclassified to profit or loss in subsequent periods Change in net liability or assets from defined benefit plan 112000.00 (1519000.00) Other comprehensive income under the equity method cannot be converted into profit or loss 602832.07 (1279985.89) Changes in fair value of other equity investment (4675000.00) 8006660.00 (3960167.93)5207674.11 Other comprehensive income to be reclassified to profit or loss in subsequent periods: Other comprehensive income under the equity method to be converted into profit or loss (75815.98) - Foreign currency reserve 38500789.80 (14185925.36) 38424973.82(14185925.36) Total comprehensive income attributable to minority interests net of tax (1916.69 ) 19231.15 Total comprehensive income 7779145245.17 3595259169.88 Including: Total comprehensive income 7832915899.613543485068.78 attributable to owners Total comprehensive income attributable to minority interest (53770654.44) 51774101.10 Earnings per share Basic earnings per share 61 0.7960 0.3616 Diluted earnings per share 61 0.7799 0.3579 The notes form an integral part of the financial statements. 91Chongqing Changan Automobile Company Limited CONSOLIDATED STATMENT OF CHANGES IN SHAREHOLDERS’ EQUITY Year ended 31 December 2022 (Expressed in Renminbi Yuan) 2022 Equity attributable to owners Share capital Capital Less: treasury Other Special Surplus Retained Subtotal Minority Total equity reserves shares comprehensive reserves reserves earnings interest income At 31 December 2021 7632153402.00 9776193360.38 655812327.60 69442469.53 27988260.61 2982292413.67 35900674525.13 55732932103.72 133307840.48 55866239944.20 Changes during the year: Total comprehensive income - - - 34464805.89 - - 7798451093.72 7832915899.61 (53770654.44 ) 7779145245.17 Capital contributed by owners and capital decreases 1.Amount of share-based payments included in shareholders' equity - 380209900.00 - - - - - 380209900.00 - 380209900.00 2.Others - 666049445.39 - - - - - 666049445.39 - 666049445.39 Distribution of profit 1.Surplus reserve - - - - - 545845221.86 (545845221.86 ) - - - 2.Distribution to owners - - (28751911.08) - - - (1778856191.54 ) (1750104280.46) - (1750104280.46 ) Internal transfer of shareholder equity 1.Capital reserve converted into share capital 2289646020.00 (2289646020.00) - - - - - - - - 2.Other comprehensive income converted to retained earnings - - - (5065660.00) - - 5065660.00 - - - Special reserves 1.Provided - - - - 104696987.95 - - 104696987.95 3726050.64 108423038.59 2.Ultilized - - - - (108594350.51 ) - - (108594350.51 ) (3439069.58) (112033420.09) Disposal of subsidiaries - - - - - - - - 10874688.69 10874688.69 At 31 December 2022 9921799422.00 8532806685.77 627060416.52 98841615.42 24090898.05 3528137635.53 41379489865.45 62858105705.70 90698855.79 62948804561.49 The notes form an integral part of the financial statements. 92Chongqing Changan Automobile Company Limited CONSOLIDATED STATMENT OF CHANGES IN SHAREHOLDERS’ EQUITY (continued) Year ended 31 December 2022 (Expressed in Renminbi Yuan) 2021 Equity attributable to owners Share capital Capital Less: treasury Other Special Surplus Retained Subtotal Minority Total equity reserves shares comprehensive reserves reserves earnings interest income At 31 December 2020 5363396174.00 10930781918.64 - 78420720.78 40847443.41 2681698087.00 34315048892.26 53410193236.09 70114229.66 53480307465.75 Changes during the year: Total comprehensive income - - - (8978251.25 ) - - 3552463320.03 3543485068.78 51774101.10 3595259169.88 Capital contributed by owners and capital decreases 1.Amount of share-based payments included in shareholders' equity 93956600.00 858413347.92 683830080.00 - - - - 268539867.92 - 268539867.92 2.Cancellation of restricted shares (1036000.00) (3667440.00) (4703440.00) - - - - - - - 3.Others - 166502161.82 - - - - - 166502161.82 11376990.65 177879152.47 Distribution of profit 1.Surplus reserve - - - - - 300594326.67 (300594326.67 ) - - - 2.Distribution to owners - - (23314312.40) - - - (1666243360.49 ) (1642929048.09 ) - (1642929048.09 ) Internal transfer of shareholder equity 1.Capital reserve converted into share capital 2175836628.00 (2175836628.00) - - - - - - - - Special reserves 1.Provided - - - - 85032433.05 - - 85032433.05 2604021.39 87636454.44 2.Ultilized - - - - (97891615.85 ) - - (97891615.85) (2561502.32) (100453118.17 ) At 31 December 2021 7632153402.00 9776193360.38 655812327.60 69442469.53 27988260.61 2982292413.67 35900674525.13 55732932103.72 133307840.48 55866239944.20 The notes form an integral part of the financial statements. 93Chongqing Changan Automobile Company Limited CONSOLIDATED CASH FLOW STATEMENT Year ended 31 December 2022 (Expressed in Renminbi Yuan) Notes V 2022 2021 CASH FLOWS FROM OPERATING ACTIVITIES Cash received from sale of goods or rendering of services 122619321871.95 128548576993.05 Refunds of taxes 2134224529.98 1031417236.58 Cash received relating to other operating activities 62 2441682594.87 3267694695.32 Subtotal of cash inflows 127195228996.80 132847688924.95 Cash paid for goods and services 97369979246.46 90214683838.52 Cash paid to and on behalf of employees 9188241321.99 7600050569.34 Cash paid for all types of taxes 8604964741.08 6961836584.35 Cash paid relating to other operating activities 62 6365696828.75 5099394721.90 Subtotal of cash outflows 121528882138.28 109875965714.11 Net cash flows from operating activities 63 5666346858.52 22971723210.84 CASH FLOWS FROM INVESTING ACTIVITIES Cash received from recovery of investment 131455724.43 79892280.00 Cash received from return on investment 1750853747.11 985428249.71 Net cash received from disposal of fixed assets intangible assets and other long-term assets 609907900.54 85134014.22 Cash received relating to other investing activities 62 - 300000000.00 Subtotal of cash inflows 2492217372.08 1450454543.93 Cash paid for acquisition of fixed assets intangible assets and other long-term assets 1405004336.97 2009773990.95 Cash paid for investment 3226058570.32 929905994.00 Other cash disbursed in connection with investment activities 62 815126333.76 - Subtotal of cash outflows 5446189241.05 2939679984.95 Net cash flows from investing activities (2953971868.97 ) (1489225441.02) 94The notes form an integral part of the financial statements. 95Chongqing Changan Automobile Company Limited CONSOLIDATED CASH FLOW STATEMENT (continued) Year ended 31 December 2022 (Expressed in Renminbi Yuan) Notes V 2022 2021 CASH FLOWS FROM FINANCING ACTIVITIES: Cash received from absorbing investments - 942392939.15 Including: cash received by the subsidiary from absorbing minority shareholders' investment - 4812859.15 Cash received from borrowings 1086598301.88 48000000.00 Cash received relating to other financing activities 62 1705726148.77 836125136.66 Sub-total of cash inflows 2792324450.65 1826518075.81 Cash repayments of borrowings 391370000.00 708000000.00 Cash paid for distribution of dividends or profits and interest expenses 1803960937.04 1704968349.69 Cash paid relating to other financing activities 62 372563245.60 2009509141.05 Sub-total of cash outflows 2567894182.64 4422477490.74 Net cash flows from financing activities 224430268.01 (2595959414.93) EFFECT OF CHANGES IN EXCHANGE RATE ON CASH 36712955.19 (24589577.53 ) NET INCREASE IN CASH AND CASH EQUIVALENTS 2973518212.75 18861948777.36 Add: Opening balance of cash and cash equivalents 49517916834.99 30655968057.63 CLOSING BALANCE OF CASH AND CASH EQUIVLANT 63 52491435047.74 49517916834.99 The notes form an integral part of the financial statements. 96Chongqing Changan Automobile Company Limited BALANCE SHEET 31 December 2022 (Expressed in Renminbi Yuan) Notes 2022/12/312021/12/31 XIV Current assets Cash 44742705933.76 41917770676.45 Financial assets held for trading 251165128.80 195798300.00 Notes receivable 32497209409.96 21500746660.99 Accounts receivable 1 5538504821.82 7931510606.59 Prepayments 519014279.72 2935068191.78 Other receivables 2 859026748.64 1756623581.93 Inventories 2872390838.54 4137987048.19 Contract assets 221555444.48 635112994.60 Other current assets 199954784.05 21082615.46 Total current assets 87701527389.77 81031700675.99 Non-current assets Long-term equity investments 3 17385137116.25 17660819978.70 Other equity instrument investment 489950000.00 691156200.000 Fixed assets 14214227798.06 16001089813.79 Construction in progress 895860965.16 475209255.90 Right-of-use assets 78806182.57 53789648.12 Intangible assets 3299143861.49 3205472940.52 Development expenditure 616814902.46 422291074.50 Long-term deferred expenses 24406892.18 12065475.24 Deferred tax assets 2631189529.75 1893957371.71 Total non-current assets 39635537247.92 40415851758.48 TOTAL ASSETS 127337064637.69 121447552434.47 The notes form an integral part of the financial statements. 97Chongqing Changan Automobile Company Limited BALANCE SHEET (continued) 31 December 2022 (Expressed in Renminbi Yuan) Notes 2022/12/312021/12/31 XIV Current liabilities Notes payable 18728133049.99 19118739562.85 Accounts payable 21488548997.96 20181845700.58 Contract liabilities 3997514972.13 8446500016.04 Payroll payable 2436938973.59 2074732440.77 Taxes payable 1376448691.45 784928251.22 Other payables 5425776798.83 4330506737.23 Contingent liabilities 3936444965.49 3050701028.41 Non-current liabilities due within one year 635180849.52 374210756.73 Other current liabilities 5932680982.04 4955516106.11 Total current liabilities 63957668281.00 63317680599.94 Non-current liabilities Long term loans 36000000.00 600000000.00 Bonds Payable 999528301.88 - Lease Liabilities 45437270.79 30751928.99 Long term payable 144571302.45 120409242.99 Long term payroll payable 20565000.00 21995000.00 Deferred income 150000000.00 150000000.00 Deferred tax liabilities 195053909.31 178583323.79 Other non-current liabilities 844435549.31 715087257.75 Total non-current liabilities 2435591333.74 1816826753.52 Total liabilities 66393259614.74 65134507353.46 Owner’s equity Share capital 9921799422.00 7632153402.00 Capital reserves 8047195325.61 9293065334.91 Less: treasury shares 627060416.52 655812327.60 Other comprehensive income 157416810.63 166051336.11 Special reserves 10285640.79 7552984.45 Surplus reserves 3528137635.53 2982292413.67 Retained earnings 39906030604.91 36887741937.47 Total owner’s equity 60943805022.95 56313045081.01 TOTAL LIABILITIES AND OWNERS’ EQUITY 127337064637.69 121447552434.47 98The notes form an integral part of the financial statements. 99Chongqing Changan Automobile Company Limited INCOME STATEMENT Year ended 31 December 2022 (Expressed in Renminbi Yuan) Notes XIV 2022/12/31 2021/12/31 Operating revenue 4 106665145289.28 98302939371.97 Less: Operating cost 4 86241479807.95 84138585800.66 Tax and surcharges 2941819015.41 2898309008.73 Operating expenses 3664889410.65 3670173505.37 General and administrative expenses 2913302431.16 2610713089.51 Research and development expenses 4234015352.11 3371837869.71 Financial income (825576954.93) (695999209.03) Interest expense 26032591.55 39147654.54 Interest income 868071769.55 752571893.13 Add: Other incomes 283581332.54 40860900.00 Investment income 5 (1923078565.61 ) 1531325711.97 Including: Investment Income/(loss) from associates and joint venture (3075237898.94 ) 1441363553.71 Income/(loss) from fair value changes (25580213.00) (2805696.00 ) Credit impairment loss (15475196.02 ) (8817825.93 ) Impairment loss (659679327.77 ) (861714244.01 ) Gain/(loss) on disposal of assets 33996713.38 10187339.53 Operating profit 5188980970.45 3018355492.58 Add: Non-operating income 50112744.21 23020197.15 Less: Non-operating expenses 25461278.69 23902086.95 Total profit 5213632435.97 3017473602.78 Less: Income tax expense (244819782.60) 11530336.10 Net profit 5458452218.57 3005943266.68 Classification by going concern Net profit from continuing operations 5458452218.57 3005943266.68 100The notes form an integral part of the financial statements. 101Chongqing Changan Automobile Company Limited INCOME STATEMENT (continued) Year ended 31 December 2022 (Expressed in Renminbi Yuan) Notes XIV 2022/12/31 2021/12/31 Other comprehensive income net of tax Total comprehensive income attributable to owners net of tax Other comprehensive income not to be reclassified to profit or loss in subsequent periods Change in net liability or assets from defined benefit plan 141000.00 (720000.00 ) Other comprehensive income under the equity method cannot be converted into profit or loss 602832.07 (1279985.89 ) Changes in fair value of other equity investment (4675000.00 ) 8097270.00 (3931167.93)6097284.11 Other comprehensive income to be reclassified to profit or loss in subsequent periods Reclassification of financial assets recognized in other comprehensive income Amounts under equity method 70412.45 - Total comprehensive income 5454591463.09 3012040550.79 The notes form an integral part of the financial statements. 102Chongqing Changan Automobile Company Limited STATMENT OF CHANGES IN SHAREHOLDERS’ EQUITY Year ended 31 December 2022 (Expressed in Renminbi Yuan) 2022 Share capital Capital reserves Less: treasury Other Special reserves Surplus reserves Retained earnings Total owner’s equity shares comprehensive income At 31 December 2021 7632153402.00 9293065334.91 655812327.60 166051336.11 7552984.45 2982292413.67 36887741937.47 56313045081.01 Changes during the year: Total comprehensive income - - - (3860755.48 ) - - 5458452218.57 5454591463.09 Capital contributed by owners and capital decreases 1.Amount of share-based payments included in shareholders' equity - 380209900.00 - - - - - 380209900.00 2.Others - 663566110.70 - - - - - 663566110.70 Distribution of profit 1.Surplus reserve - - - - - 545845221.86 (545845221.86 ) - 2.Distribution to owners - - (28751911.08 ) - - - (1778856191.54 ) (1750104280.46 ) Internal transfer of shareholder equity 1.Capital reserve converted into share capital 2289646020.00 (2289646020.00 ) - - - - - - 2.Other comprehensive earnings converted to retained earnings - - - (4773770.00) - - 4773770.00 - Special reserves 1.Provided - - - - 61019966.31 - - 61019966.31 2.Ultilized - - - - (58287309.97 ) - - (58287309.97 ) Disposition of subsidiaries - - - - - - (120235907.73) (120235907.73 ) At 31 December 2022 9921799422.00 8047195325.61 627060416.52 157416810.63 10285640.79 3528137635.53 39906030604.91 60943805022.95 The notes form an integral part of the financial statements. 103Chongqing Changan Automobile Company Limited STATMENT OF CHANGES IN SHAREHOLDERS’ EQUITY (continued) Year ended 31 December 2022 (Expressed in Renminbi Yuan) 2021 Share capital Capital reserves Less: treasury Other Special reserves Surplus reserves Retained earnings Total owner’s equity shares comprehensive income At 31 December 2020 5363396174.00 10440896902.52 - 159954052.00 7505438.57 2681698087.00 35848636357.95 54502087012.04 Changes during the year: Total comprehensive income - - - 6097284.11 - - 3005943266.68 3012040550.79 Capital contributed by owners and capital decreases 1.Amount of share-based payments included in shareholders' equity 93956600.00 858413347.92 683830080.00 - - - - 268539867.92 2.Cancellation of restricted shares (1036000.00 ) (3667440.00) (4703440.00) - - - - - 3.Others - 173259152.47 - - - - - 173259152.47 Distribution of profit 1.Surplus reserve - - - - - 300594326.67 (300594326.67 ) - 2.Distribution to owners - - (23314312.40 ) - - - (1666243360.49) (1642929048.09) Internal transfer of shareholder equity 1.Capital reserve converted into share capital 2175836628.00 (2175836628.00 ) - - - - - - Special reserves 1.Provided - - - - 52743013.00 - - 52743013.00 2.Ultilized - - - - (52695467.12 ) - - (52695467.12) At 31 December 2021 7632153402.00 9293065334.91 655812327.60 166051336.11 7552984.45 2982292413.67 36887741937.47 56313045081.01 The notes form an integral part of the financial statements. 104Chongqing Changan Automobile Company Limited CASH FLOW STATEMENT Year ended 31 December 2022 (Expressed in Renminbi Yuan) 20222021 CASH FLOWS FROM OPERATING ACTIVITIES Cash received from sale of goods or rendering of services 101043628683.39 111833846959.34 Refunds of taxes 215500668.27 - Cash received relating to other operating activities 2041143114.40 1467818250.53 Subtotal of cash inflows 103300272466.06 113301665209.87 Cash paid for goods and services 80159943881.88 78605485054.62 Cash paid to and on behalf of employees 6388175996.37 5542027671.21 Cash paid for all types of taxes 5761670921.49 5258611669.40 Cash paid relating to other operating activities 4922708175.82 4133449098.11 Subtotal of cash outflows 97232498975.56 93539573493.34 Net cash flows from operating activities 6067773490.50 19762091716.53 CASH FLOWS FROM INVESTING ACTIVITIES Cash received from recovery of investment 121799633.86 79892280.00 Cash received from return on investment 1809926134.11 918427083.03 Net cash received from disposal of fixed assets intangible assets and other long-term assets 554362304.63 14915738.17 Cash received relating to other investing activities - 500000000.00 Subtotal of cash inflows 2486088072.60 1513235101.20 Cash paid for acquisition of fixed assets intangible assets and other long-term assets 1064936821.33 1479062944.86 Cash paid for investment 3506058570.32 1429902283.00 Subtotal of cash outflows 4570995391.65 2908965227.86 Net cash flows from investing activities (2084907319.05) (1395730126.66) The notes form an integral part of the financial statements. 105Chongqing Changan Automobile Company Limited CASH FLOW STATEMENT (continued) Year ended 31 December 2022 (Expressed in Renminbi Yuan) 20222021 CASH FLOWS FROM FINANCING ACTIVITIES: Cash received from absorbing investments - 683830080.00 Cash received from borrowings 1039528301.88 - Sub-total of cash inflows 1039528301.88 683830080.00 Cash repayments of borrowings 354300000.00 611000000.00 Cash paid for distribution of dividends or profits and interest expenses 1802234067.67 1702697363.56 Cash paid relating to other financing activities 23280631.67 37526537.08 Sub-total of cash outflows 2179814699.34 2351223900.64 Net cash flows from financing activities (1140286397.46) (1667393820.64 ) EFFECT OF CHANGES IN EXCHANGE RATE ON CASH - - NET INCREASE IN CASH AND CASH EQUIVALENTS 2842579773.99 16698967769.23 Add: Opening balance of cash and cash equivalents 41889838553.29 25190870784.06 CLOSING BALANCE OF CASH AND CASH EQUIVLANT 44732418327.28 41889838553.29 The notes form an integral part of the financial statements. 106Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) I CORPORATE INFORMATION Chongqing Changan Automobile Company Limited (hereafter referred to as “the Company”) is a company limited by shares registered in Chongqing People’s Republic of China. It was established on 31 October 1996 with an indefinite business period. The ordinary A shares of Renminbi issued by the company and the B shares of domestically listed foreign shares have been listed on the Shenzhen Stock Exchange. The company is headquartered at 260 Jianxin East Road Jiangbei District Chongqing China and its office address is T2 Building No. 2 Financial City No. 61 Dongshengmen Road Jiangbei District Chongqing China. In 2022 due to the capital reserve conversion plan the total share capital of the company increased by RMB2289646020.00. On 31 December 2022 the total share capital of the company was RMB9921799422.00.Until December 31 2022 the controlling shareholder of the company China Changan Automobile Group Co. Ltd. (hereinafter referred to as "China Changan") and its wholly-owned subsidiary Zhonghui Futong (Hong Kong) Investment Co. Ltd. hold a total of 2063588975 ordinary shares of the company representing an equity ratio of 20.80%. China South Industries Group Co. Ltd. (hereinafter referred to as "South Group") which is the parent company of China Changan and its wholly-owned subsidiaries Nanfang Industrial Asset Management Co. Ltd.(hereinafter referred to as "Nanfang Asset") and China Southern Industries International Holdings (Hong Kong) Co. Ltd. hold a total of 1921622884 ordinary shares of the Company representing a shareholding ratio of 19.37%. China Changan and South Group hold a total of 3985211859 ordinary shares of the company with an equity ratio of 40.17%.The company and its subsidiaries collectively refer to as “the Group” and its main business activities are the manufacturing and sales of automobiles (including cars) automobile engine products and supporting parts.The holding company and ultimate holding company of the Company are China Changan and China South Group respectively.According to the Articles of Association the financial statements which has been approved by the board of directors on 16 April 2023 was submitted to general meeting of shareholders for approval.The scope of consolidation in the consolidated financial statement is determined based on control. For the consolidation scope of this year please refer to Note VI. 107Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) II 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 provisionsissued subsequently by the MOF (correctly referred to as “Accounting Standards for BusinessEnterprises”).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.III 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 inventory valuation depreciation of fixed assets intangible assets amortization condition of capitalization of research and development expense and revenue recognition and measurement. 1. Statement of compliance with Accounting Standards for Business Enterprises The financial statements present fairly and fully the financial position of the company on 31 December 2022 and the financial results and the cash flows for the 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. 108Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 4. Business combination (continued) 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 recognized 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 recognize the remaining difference in profit or loss. 109Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 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 ventures. Joint ventures refer to those joint venture arrangements only the right to net assets of which is enjoyed by the joint ventures.Any joint venture 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. 110Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 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 average exchange rate of the period in which the transaction occurred (unless the exchange rate fluctuation makes it inappropriate to adopt this exchange rate for conversion the spot exchange rate on the date of cash flow shall be adopted for conversion); 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 (unless the exchange rate fluctuation makes it inappropriate to adopt this exchange rate for conversion the spot exchange rate on the date of cash flow shall be adopted for conversion). 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. 111Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 9. Financial instruments 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.A financial asset (or where applicable a part of a financial asset or part of a group of similar financial assets) is primarily derecognized (i.e. removed from the Group’s consolidated balance sheet) when: 1) the rights to receive cash flows from the financial asset have expired; 2) the Group has transferred its rights to receive cash flows from the financial 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 financial asset or (b) has neither transferred nor retained substantially all the risks and rewards of the asset but has transferred control of the financial asset.A financial liability is derecognized when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms or the terms of an existing liability are substantially modified such an exchange or modification is treated as a derecognition of the original liability and a recognition of a new liability and the difference between the respective carrying amounts is recognized in profit or loss.Regular way purchases and sales of financial assets are recognized and derecognized using trade date accounting. Regular way purchases or sales are purchases or sales of financial assets that require delivery within the period generally established by regulation or convention in the marketplace. The trade date is the date that the Group committed to purchase or sell a financial asset.Classification and measurement of financial assets The classification of financial assets at initial recognition depends on the financial asset’s contractual cash flow characteristics and the Group’s business model for managing them: financial assets at fair value through profit or loss financial assets at amortized cost and financial assets at fair value through other comprehensive income. All affected related financial assets will be reclassified only if the Group changes its business model for managing financial assets.Financial assets are measured at fair value on initial recognition but accounts receivable or notes receivable arising from the sale of goods or rendering of services that do not contain significant financing components or for which the Group has applied the practical expedient of not adjusting the effect of a significant financing component due within one year are initially measured at the transaction price. 112Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 9. Financial instruments(continued) Classification and measurement of financial assets(continued) For financial assets at fair value through profit or loss relevant transaction costs are directly recognized in profit or loss and transaction costs relating to other financial The subsequent measurement of financial assets depends on their classification as follows: Debt investments measured at amortized cost The Group measures financial assets at amortized cost if both of the following conditions are met: the financial asset is held within a business model with the objective to hold financial assets in order to collect contractual cash flows; the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. Financial assets at amortized cost are subsequently measured using the effective interest method. Gains and losses are recognized in profit or loss when the asset is derecognized modified or impaired.Debt investments at fair value through other comprehensive income The Group measures debt investments at fair value through other comprehensive income if both of the following conditions are met: the financial asset is held within a business model with the objective of both holding to collect contractual cash flows and selling; the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. Interest income is recognized using the effective interest method. The interest income impairment losses and foreign exchange revaluation are recognized in profit or loss. The remaining fair value changes are recognized in other comprehensive income. Upon derecognition the cumulative fair value change recognized in other comprehensive income is recycled to profit or loss.Equity investments at fair value through other comprehensive income The Group can elect to classify irrevocably its equity investments which are not held for trading as equity investments designated at fair value through other comprehensive income. Only the relevant dividend income (excluding the dividend income explicitly recovered as part of the investment cost) is recognized in profit or loss. Subsequent changes in the fair value are included in other comprehensive income and no provision for impairment is made. When the financial asset is derecognized the accumulated gains or losses previously included in other comprehensive income are transferred from other comprehensive income to retained earnings. 113Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 9. Financial instruments (continued) Classification and measurement of financial assets (continued) Financial assets at fair value through profit or loss The financial assets other than the above financial assets measured at amortized cost and financial assets at fair value through other comprehensive income are classified as financial assets at fair value through profit or loss. Such financial assets are subsequently measured at fair value with net changes in fair value recognized in profit or loss.Financial liabilities are classified at initial recognition as financial liabilities at fair value through profit or loss other financial liabilities. For financial liabilities at fair value through profit or loss relevant transaction costs are directly recognized in profit or loss and transaction costs relating to other financial assets 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 financial liabilities designated upon initial recognition as at fair value through profit or loss.Financial liabilities held for trading are subsequently measured at fair value with net changes in fair value recognized in profit or loss. Gains or losses on liabilities designated at fair value through profit or loss are recognized in profit or loss except for the gains or losses arising from the Group’s own credit risk which are presented in other comprehensive income with no subsequent reclassification to profit or loss.Other financial liabilities Other financial liabilities are subsequently measured at amortized cost using the effective interest method. 114Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 9. Financial instruments (continued) Impairment of financial assets On the basis of expected credit loss the Group carries out impairment treatment on financial assets measured at amortized cost and contract assets and recognizes loss reserves For receivables and contract assets that do not contain significant financing components the Group uses a simplified measurement method to measure the loss provision based on the expected credit loss amount for the entire duration.For financial assets other than the simplified measurement method mentioned above the Group assesses on each balance sheet date whether its credit risk has not increased significantly since initial recognition it is in the first stage. The Group measures the loss provision based on the amount equivalent to the expected credit loss in the next 12 months and calculates the interest income based on the book balance and the actual interest rate; if the credit risk has increased significantly since initial recognition but has not yet suffered credit impairment it is in the second at this stage the Group measures the loss provision based on the amount equivalent to the expected credit loss for the entire duration and calculates the interest income based on the book balance and the actual interest rate; If credit impairment occurs after initial recognition it is in the third stage. The amount of expected credit losses is measured over the entire duration of the loss allowance and interest income is calculated based on amortized cost and effective interest rate. For financial instruments with low credit risk on the balance sheet date the Group assumes that their credit risk has not increased significantly since initial recognition.The Group assesses the expected credit losses of financial instruments based on individual items and portfolios. The Group has considered the credit risk characteristics of different customers and evaluated the expected credit losses of accounts receivable and other receivables based on the ageing combination.Please refer to Note VII3 for the disclosure of the Group’s judgment criteria for significant increase in credit risk the definition of credit impairment assets that have occurred and assumptions about the expected credit loss measurement.When the Group no longer reasonably expects to be able to fully or partially recover the contractual cash flows of financial assets the Group directly writes down the book balance of the financial asset. 115Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 9. Financial instruments (continued) 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 recognized amounts; and there is an intention to settle on a net basis or to realize 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. 10. Inventories Inventory includes raw materials goods in transit work in progress finished goods consigned processing materials low-value consumables.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. 116Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 11. Long-term equity investments Long-term equity investments include investments in subsidiaries joint ventures and associates.Long-term equity investments are recognized at initial investment cost upon acquisition. For a long-term equity investment acquired through a business combination under common control the initial investment cost of the long-term equity investment shall be the absorbing party’s share of the carrying amount of the owners’ equity of the party being absorbed in the consolidated financial statements of the ultimate controlling party at combination date. The difference between the initial investment cost and the carrying amount of cash paid non-cash assets transferred and liabilities assumed shall be adjusted to capital reserve. If the balance of capital reserve is not sufficient any excess shall be adjusted to retained earnings. Any other comprehensive income previously recognized shall be accounted for on the same basis as would have been required if the investee had directly disposed of the related assets or liabilities. The portion recognized based on changes in the investee’s equity (other than net profit or loss other comprehensive income and profit appropriation) is charged to profit or loss upon disposal of such long-term equity investment. For those partially disposed equity investments gains or losses upon disposal are proportionately recognized in profit or loss when they still constitute long- term equity investments after the disposal and are fully charged to profit or loss when they are reclassified to financial instruments after the disposal. For business combination involving entities not under common control the initial investment cost should be the cost of acquisition (for step acquisitions not under common control the initial investment cost is the sum of the carrying amount of the equity investment in the acquiree held before the acquisition date and the additional investment cost paid on the acquisition date) which is the sum of the fair value of assets transferred liabilities incurred or assumed and equity instruments issued. If the equity investments in the acquiree involve other comprehensive income prior to the acquisition date when disposing of the investments the relevant other comprehensive income will be accounted for on the same basis as would have been required if the investee had directly disposed of the related assets or liabilities. The portion recognized based on changes in the investee’s equity (other than net profit or loss other comprehensive income and profit appropriation) is charged to profit or loss upon disposal of such long-term equity investment. The initial investment cost of a long-term equity investment acquired otherwise than through a business combination shall be determined as follows: for a long-term equity investment acquired by paying cash the initial investment cost shall be the actual purchase price has been paid plus those costs taxes and other necessary expenditures directly attributable to the acquisition of the long-term equity investment; for those acquired by the issue of equity securities the initial investment cost shall be the fair value of the equity securities issued. 117Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 11. Long-term equity investments (continued) 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 ventures). 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 when the initial investment cost of a long-term equity investment exceeds the investing enterprise’s interest in the fair values of the investee’s identifiable net assets at the acquisition date the difference is accounted for as an initial cost. As to the initial investment cost is less than the investing enterprise’s interest in the fair values of the investee’s identifiable net assets at the acquisition date the difference shall be charged to the income statement for the current period and the cost of the long-term equity investment shall be adjusted accordingly.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. 118Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 11. Long-term equity investments (continued) 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. 12. 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. 13. 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. 119Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 13. Fixed assets (continued) 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. 14. 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. 15. 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. 120Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 15. Borrowing costs (continued) 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. 16. Right-of-use assets The Group's right-of-use assets are mainly buildings.At the commencement date of the lease period the Group recognizes its right to use the leased assets during the lease period as a right-of-use asset including: the initial measured amount of the lease liability; the amount of lease payments paid on or before the start date of the lease period in addition the relevant amount of lease incentive should be deducted; Initial direct expenses incurred by the lessee; the estimated cost incurred by the lessee for dismantling and removing the leased assets restoring the site where the leased assets are located or restoring the leased assets to the state agreed in the lease terms. the Group adopts the average age method to depreciate the assets of the right of use. If it can be reasonably determined that the ownership of the leased asset is obtained at the expiration of the lease term the Group adopts depreciation within the remaining service life of the leased asset. If it is impossible to reasonably determine that the ownership of the leased asset can be obtained at the expiration of the lease term the Group adopts depreciation within the shorter of the lease term and the remaining service life of the leased asset.When the Group remeasures the lease liability according to the present value of the changed lease payment and adjusts the book value of the right of use asset if the carrying amount of the right-of-use assets has been reduced to zero but the lease liabilities still need to be further reduced the Group will include the remaining amount in the profit or loss of the current period. 121Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 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 to 7 years Patent technology 10 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. 122Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 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 contract assets 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. 123Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 19. Impairment of assets (continued) 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. 124Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 21. Employee benefits (continued) Short-term employee salaries During the accounting period of employee rendering service the actual 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 recognized 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 recognized in profit or loss at the earlier of: the date of the plan amendment or curtailment; and the date that the Group recognizes restructuring-related costs.Net interest is calculated by applying the discount rate to the net defined benefit liability or asset.The Group recognizes 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 recognized at the earlier of when the Group can no longer withdraw the offer of those benefits and when the Group recognizes restructuring costs involving the payment of termination benefits. 125Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 22. Lease liabilities At the commencement date of the lease period the Group recognizes the present value of the outstanding lease payments as a lease liability excluding short-term leases and leases of low- value assets. When calculating the present value of the lease payment the Group uses the lease implied rate as the discount rate and if the lease implied interest rate cannot be determined the lessee incremental borrowing rate is used as the discount rate. The Group calculates the interest expense of the lease liability in each period of the lease term according to the fixed periodic interest rate and records it into the current profit and loss unless otherwise specified it is included into the cost of relevant assets. Variable lease payments that are not included in the measurement of lease liabilities are included in the profit or loss of the current period when actually incurred unless otherwise specified to be included in the cost of the underlying assets.After the commencement date of the lease period the Group remeasures the lease liability against the present value of the changed lease payment amount when there is a change in the amount of substantial fixed payments a change in the amount expected to pay due to the residual value of the guarantee a change in the index or ratio used to determine the amount of the lease payment the assessment of the purchase option the renewal option or the option to terminate the lease. 23. Provisions An obligation related to a contingency shall be recognized 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.The contingent liabilities of the acquiree acquired in the business combination involving entities not under common control are measured at fair value upon initial recognition. After initial recognition the balance of the amount recognized according to the estimated liabilities and the amount initially recognized after deducting the accumulated amortization determined by the revenue recognition principle is subsequently measured at the higher of the two. 126Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 24. Share-based payments A share-based payment is classified as either an equity-settled share-based payment or a cash- settled share-based payment. An equity-settled share-based payment is a transaction in which the Group receives services and uses shares or other equity instruments as consideration for settlement.An equity-settled share-based payment in exchange for services received from employees is measured at the fair value of the equity instruments granted to the employees. If such equity- settled share-based payment could vest immediately related costs or expenses at an amount equal to the fair value on the grant date are recognized with a corresponding increase in capital reserves; if such equity-settled share-based payment could not vest until the completion of services for a vesting period or until the achievement of a specified performance condition the Group at each balance sheet date during the vesting period recognizes the services received for the current period as related costs and expenses with a corresponding increase in capital reserves at an amount equal to the fair value of the equity instruments at the grant date based on the best estimate of the number of equity instruments expected to vest. The fair value is determined using the closing price of the company's shares on the grant date.For awards that do not ultimately vest because non-market performance and/or service conditions have not been met no expense is recognized. 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 share-based award are modified as a minimum an expense is recognized as if the terms had not been modified. In addition an expense is recognized for any modification that increases the total fair value of the share-based payment or is otherwise beneficial to the employee as measured at the date of modification.Where an equity-settled share-based award is cancelled it is treated as if it had vested on the date of cancellation and any expense not yet recognized for the award is recognized 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 on the date that it is granted the cancelled and new awards are treated as if they were a modification of the original award. 127Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 25. Revenue from contracts with customers The Group has fulfilled its performance obligations in the contracts that is the revenue is recognized when the customer obtains control of the relevant goods or services. Obtaining control over related goods or services means being able to lead the use of the goods or the provision of the services and obtain almost all of the economic benefits from it.Contracts for the sale of goods A contract for the sale of goods between the Group and the customer usually includes the performance obligation to transfer of goods transportation services and free maintenance. The Group allocates the transaction price to each individual performance obligation in accordance with the relative proportion of the stand-alone selling price of the goods or services promised by each individual performance obligation on the date of contract commencement. Regarding the performance obligations of the transferred goods the Group usually recognizes revenue at the point when the performance obligations are fulfilled based on the following indicators which include: a present right to payment for goods the transfer of significant risks and rewards of ownership of goods the transfer of legal title to goods the transfer of physical possession of goods the customer’s acceptance of goods.Provide service contract The performance obligations of the service provision contract between the Group and the customer are due to the fact that the customer obtains and consumes the economic benefits brought by the performance of the Group at the same time the Group performs the contract and the Group has the right to accumulate the economic benefits during the entire contract period.The Group regards it as a performance obligation performed within a period and recognizes the revenue according to the performance progress unless the performance progress cannot be reasonably determined. In accordance with the output method the Group determines the progress of the performance of the service provided based on the completed or delivered products. When the performance progress cannot be reasonably determined if the cost incurred by the Group is expected to be compensated the revenue will be recognized according to the amount of the cost incurred until the performance progress can be reasonably determined.Variable consideration Some contracts between the Group and customers have sales rebate arrangements forming variable consideration. The Group determines the best estimate of the variable consideration based on the expected value or the most likely amount but the transaction price including the variable consideration does not exceed the amount that the accumulated recognized revenue will most likely not be materially reversed when the relevant uncertainty is eliminated. 128Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 25. Revenue from contracts with customers (continued) Warranty obligations In accordance with contractual agreements and legal provisions the Group provides quality assurance for the goods sold. For guarantee quality assurance to ensure that the products sold meet the established standards the Group conducts accounting treatment in accordance with Note III 23. For the service quality assurance that provides a separate service in addition to the established standards to ensure that the goods sold meet the established standards the Group regards it as a single performance obligation based on the stand-alone selling price of the quality assurance of the goods and services provided. In a relative proportion part of the transaction price is allocated to service quality assurance and revenue is recognized when the customer obtains control of the service. When assessing whether the quality assurance provides a separate service in addition to ensuring that the products sold meet the established standards the Group considers whether the quality assurance is a legal requirement the quality assurance period and the nature of the Group's commitment to perform tasks.Principal/agent For the Group to lead a third party to provide services to customers on behalf of the Group the Group has the right to independently determine the price of the goods or services traded that is the Group can control the relevant goods before transferring the goods to the customers so the Group is the main responsible person and recognize revenue based on the total consideration received or receivable. Otherwise the Group acts as an agent and recognizes revenue based on the amount of commission or fees expected to be charged. This amount should be based on the net amount of the total consideration received or receivable minus the price payable to other related parties or based on the established commission amount or proportions etc. 26. Contract assets and contract liabilities The Group lists contract assets or contract liabilities in the balance sheet based on the relationship between performance obligations and customer payments. The Group offsets the contract assets and contract liabilities under the same contract as net amount.Contract assets Contract assets refer to the right to receive consideration for the transfer of goods or services to customers and this right depends on factors other than the passage of time.The determination method and accounting treatment method of the expected credit loss of the contract assets of the Group refer to Note III 9. 129Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 26. Contract assets and contract liabilities (continued) Contract liabilities Contract liabilities refer to the obligation to transfer goods or services to customers for the consideration received or receivable from customers such as the payment received by companies before the transfer of promised goods or services. 27. 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 net 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. 130Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 28. 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. 131Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 28. Income taxes (continued) 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.When the following conditions are met at the same time the deferred tax assets and deferred tax liabilities are listed at the net amount after offset: the legal right to settle the current income tax assets and current income tax liabilities at the net amount; the deferred tax assets and deferred tax liabilities are related to the income tax levied by the same tax collection and management department on the same taxable subject or different taxpaying subjects However in the future during each period when the significant deferred tax assets and deferred tax liabilities are reversed the tax payer involved intends to settle the current income tax assets and current income tax liabilities with net amount or obtain assets and pay off debts at the same time. 29. Leases Identification of leases At inception of a contract the Group assesses whether the contract is or contains a lease. A contract is or contains a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To assess whether a contract conveys the right to control the use of an identified asset for a period of time the Group assesses whether throughout the period of use the customer has both of the right to obtain substantially all of the economic benefits from use of the identified asset and the right to direct the use of the identified asset. 132Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 29. Leases (continued) Assessment of the lease term The lease term is the non-cancellable period of a lease for which the Group has the right to use an underlying asset. If the Group has an option to extend the lease that is the Group has the right to extend the lease and is reasonably certain to exercise that option the lease term also includes periods covered by an option to extend the lease. If the Group has an option to terminate the lease that is the Group has the right to terminate the lease but is reasonably certain not to exercise that option the lease term includes periods covered by an option to terminate the lease. The Group reassesses whether it is reasonably certain to exercise an extension option purchase option or not to exercise a termination option upon the occurrence of either a significant event or a significant change in the circumstances that is within the control of the Group and affects whether the Group is reasonably certain to exercise an option not previously included in its determination of the lease term.As lessee The Group's general accounting treatment as a lessee is provided in Notes III 16 and 22.Short-term leases and leases of low-value assets The Group considers a lease that at the commencement date of the lease has a lease term of 12 months or less and does not contains any purchase option as a short-term lease; and a lease with a lower value of a single leased asset is recognized as a low value asset lease.As lessor A lease is classified as a finance lease if it transfers substantially all the risks and rewards incidental to ownership of an underlying asset except that a lease is classified as an operating lease at the inception date.The Group recording the operating lease as a lessor Rental income under an operating lease is recognized on a straight-line basis over the lease term through profit or loss. Variable lease payments that are not included in the measurement of lease receivables are charged to profit or loss as incurred. 133Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 29. Leases (continued) The Group accounts for a modification to an operating lease as a new lease from the effective date of the modification considering any prepaid or accrued lease payments relating to the original lease as part of the lease payments for the new lease.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. 30. Profit distribution The cash dividend of the Group is recognized as liabilities after the approval of general meeting of stockholders. 31. 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. 32. 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.The Group measures 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 in the principal market for the asset or liability or in the most advantageous market for the asset or liability when a principal market is absent. The principal or the most advantageous market must be accessible to 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. 134Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 32. Fair value measurement (continued) The Group uses valuation techniques that are appropriate in the circumstances and for which sufficient data and other supporting information are available to measure fair value giving priority to the use of relevant observable inputs and using unobservable inputs only when observable inputs are unavailable or not feasible to obtain.All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized 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 – Quoted (unadjusted) market prices in active markets for identical assets or liabilities Level 2 – Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable Level 3 – Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable For assets and liabilities that are recognized in the financial statements on a recurring basis the Group determines whether transfers have occurred between levels in the hierarchy by reassessing categorization at the end of each reporting period. 33. 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: Business model The classification of financial assets at initial recognition depends on the business model of the Group’s management of financial assets. When judging the business model the Group considers the methods including enterprise evaluation and reporting of financial asset performance to key management personnel risks affecting financial asset performance and its arangement method and the way in which related business managers get paid. When evaluating whether to take contract cash flow as the goal the Group needs to analyze and judge the reasons time frequency and value of the sale of financial assets before the due date. 135Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 33. Significant accounting judgments and estimates (continued) Judgments (continued) Contract cash flow characteristics The classification of financial assets at initial recognitions depends on the contractual cash flow characteristics of the financial assets. It is necessary to determine whether the contractual cash flow is only for the payment of principal and interest based on outstanding principal including correction of the time value of money during the evaluation it is necessary to determine whether there is a significant difference compared to the benchmark cash flow. For financial assets that include prepayment characteristics it is necessary to determine whether the fair value of the prepayment characteristics is very small etc.Uncertainty of accounting estimates The crucial assumptions of significant accounting estimates in future and other crucial sources of estimated uncertainty which may result in the significant adjustments to the book value of the subsequent accounting period are as the following: Impairment of financial instruments and contract assets The Group uses the expected credit loss model to assess the impairment of financial instruments and contract assets. The application of the expected credit loss model requires significant judgments and estimates. All reasonable and valid information must be considered including forward-looking information. In making these judgments and estimates the Group infers the expected changes in the credit risk of the debtor based on historical repayment data combined with economic policies macroeconomic indicators industry risks and other factors. Different estimates may affect the provision for impairment losses. The provision for impairment losses may not be equal to the actual amount of future impairment losses.Uncertainty of accounting estimates (continued) 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.Fair value of unlisted equity investments For unlisted equity instrument investments several valuation models are used to estimate the fair value. This requires the Group to make estimates of unobservable market parameters such as price-to-book ration discount rate sustainable growth rate asset price index etc. and is therefore uncertain. 136Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 33. Significant accounting judgments and estimates (continued) 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.Uncertainty of accounting estimates (continued) The lessee's incremental borrowing rate For leases where the interest rate embedded in the lease cannot be determined the Group uses the lessee's incremental borrowing rate as the discount rate to calculate the present value of the lease payment. When determining the incremental borrowing rate the Group uses the observable interest rate as the reference basis for determining the incremental borrowing rate according to its economic environment and on this basis adjusts the reference interest rate according to its own circumstances the underlying assets the lease period and the amount of lease liabilities and other leasing business conditions to derive the applicable incremental borrowing rate. 137Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) IV TAXES 1. Main taxes and tax rates Value added tax (“VAT”) - The income from the sale of goods and the income from the provision of services are calculated at the tax rates of 13% and 6% respectively and the VAT is calculated on the basis of the difference after deducting the input tax that is allowed to be deducted in the current period.Consumption tax - Consumption tax is calculated at 1% 3% or 5% of taxable income.City maintenance and 5% or 7% of the turnover tax paid is calculated and paid.- construction tax Educational surcharge - 3% of the actual turnover tax paid is calculated and paid.Local educational 2% of the turnover tax actually paid is calculated and paid.- surcharge Corporate income tax - Corporate income tax is paid at 15% or 25% of taxable income. 2. Tax benefits According to the relevant provisions of the national high-tech identification and relevant tax preferential policies the following companies of the Group are identified as high-tech enterprises and are subjected to the preferential corporate income tax rate of 15% within the prescribed period: the company (2021-2023) and the Company’s subsidiaries including Hebei Changan Automobile Company Limited (2020-2022) and Baoding Changan Bus Manufacturing Company Limited (2020- 2022). According to the Announcement on Continuing the Income Tax Policy for Enterprises in the Large- scale Development of the Western Region jointly issued by the Ministry of Finance the State Administration of Taxation and the National Development and Reform Commission from January 1 2021 to December 31 2030 enterprise income tax will be levied at a reduced rate of 15% for encouraged industrial enterprises located in the western region. Chongqing Changan Automobile International Sales Service Co. Ltd. Chongqing Changan Special Purpose Vehicle Co. Ltd. Chongqing Changan Automobile Customer Service Co. Ltd. Chongqing Lingyao Automobile Co. Ltd. and Chongqing Chehemei Technology Co. Ltd. subsidiaries of the Company meet the above requirements and are subject to corporate income tax calculated at a 15% corporate income tax rate.According to the Announcement on Enterprise Income Tax Policies on Promoting the High-quality Development of the Integrated Circuit Industry and the Software Industry jointly issued by the Ministry of Finance the State Administration of Taxation the Development and Reform Commission and the Ministry of Industry and Information Technology software enterprises encouraged by the state are exempt from enterprise income tax from the first to second year from the year of profit and from the third to the fifth year the statutory tax rate of 25% is halved. Chongqing Changan Automobile Software Technology Co. Ltd. a subsidiary of the Company meets the above conditions and this year is the second profit year and is exempt from corporate income tax. 138Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) V NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 1. Cash 20222021 Cash 32155.77 36881.35 Cash at bank 52455913791.28 49517879953.64 Other cash 1074237880.29 2458325314.38 Total 53530183827.34 51976242149.37 On 31 December 2022 the book value of restricted cash was RMB1038748779.60 which was mainly restricted for the issuance of acceptance bill (December 2021: RMB2458325314.38).On December 2022 the cash at bank overseas is equivalent to RMB 231286316.97 (31 December 2021: RMB 300347944.86). On December 31 2022 the cash deposited by the Group in the finance company (related party) was RMB 34812952043.78 (December 31 2021: RMB 31652980551.77). Refer to note IX7.Cash at banks earns interest at floating rates based on daily bank deposit rates. The 7-day bank notice deposits and fixed deposits can be withdrawn at any time according to the cash requirements of the Group and interest income is obtained according to the corresponding bank deposit rates. 2. Financial assets held for trading 20222021 Equity instrument investment 251165128.80 177902700.00 Others 29150442.29 17895600.00 Total 280315571.09 195798300.00 As of December 31 2022 the equity instrument investment was 33.63 million ordinary shares of Southwest Securities Co. Ltd. held by the Group without selling restrictions (December 31 2021: 33.63 million) and 26.05 million restricted shares of CATARC Automotive Proving Ground Co. Ltd. (December 31 2021: Nil comments). 139Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 3. Notes receivable (1) Classification of notes receivable 20222021 Commercial acceptance bill 10010938909.34 7080362856.62 Bank acceptance bill 25838721743.62 17187270560.03 Total 35849660652.96 24267633416.65 (2) Pledged notes receivable 20222021 Commercial acceptance bill 508288620.00 1042916400.00 Bank acceptance bill 5831967343.00 6164348540.74 Total 6340255963.00 7207264940.74 As at 31 December 2022 and 2021 notes receivable with above carrying amount were pledged to issue notes payable. (3) Endorsed or discounted but unexpired notes receivable as at the end of reporting period are as follow: 20222021 Derecognition Un- Derecognition Un-derecognition derecognition Commercial acceptance bill 518527457.01 - 10249473.84 - Bank acceptance bill 4775896824.61 - 2381317582.00 - Total 5294424281.62 - 2391567055.84 - (4) As at 31 December 2022 there was no note receivables converted to accounts receivable due to the inability of the drawer to perform the contract. (As at 31 December 2021: Nil comments) 140Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 4. Accounts receivable (1) Aging analysis of the accounts receivable on 31 December 2022 is as follows: 20222021 Within 1 year 2905353787.00 1605244476.97 1 to 2 years 176712124.08 28484908.94 2 to 3 years 25732015.24 116846682.50 Over 3 years 201045330.53 140125844.08 Total 3308843256.85 1890701912.49 Less: Provision (240428841.56 ) (215274377.62 ) 3068414415.291675427534.87 (2) The movements in provision for impairment of accounts receivable are as follows: Beginning Accrual Reversal Write-off Ending balance balance 2022215274377.6235457297.584945346.855357486.79240428841.56 2021189491038.2231121598.403933948.001404311.00215274377.62 (3) Analysis of accounts receivable by category as at 31 December 2022 is as follows: 2022 Balance Accrual Amount (%) Amount (%) Individually analyzed for provision 2059626543.23 62.25 152800930.19 7.42 Provision based on the combination of credit risk characteristics 1249216713.62 37.75 87627911.37 7.01 Total 3308843256.85 100.00 240428841.56 7.27 2021 Balance Accrual Amount (%) Amount (%) Individually analyzed for provision 1116005410.48 59.03 161822950.43 14.50 Provision based on the combination of credit risk characteristics 774696502.01 40.97 53451427.19 6.90 Total 1890701912.49 100.00 215274377.62 11.39 141Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 4. Accounts receivable (continued) (4) The Group’s accounts receivable was analyzed for provision by expected credit loss model 20222021 Estimated face Expected Expected credit Face balance Provision Provision for bad value for default credit loss loss for the entire ratio (%) debt rate (%) duration Within 1 year 1031532359.36 0.41 4211660.35 572882251.72 0.13 759937.11 1 to 2 years 30724065.06 7.24 2225905.84 28352246.25 8.57 2429794.47 2 to 3 years 25707148.00 16.02 4118732.53 92634562.67 12.47 11548535.79 Over 3 years 161253141.20 47.80 77071612.65 80827441.37 47.90 38713159.82 Total 1249216713.62 7.01 87627911.37 774696502.01 6.90 53451427.19 (5) As at 31 December 2022 accounts receivable from Top 5 clients amounted to RMB1880530.647.71 accounted for 56.83%. (2021：RMB924920983.66 accounted for 48.92% of the total accounts receivable). (6) There were no accounts receivable derecognized due to transfer of financial assets during 2022 (2021: Nil). 5. Prepayments (1) Aging analysis of the prepayments is as follows: 20222021 Aging Amount Percentage Amount Percentage (%)(%) Within 1 year 523061724.51 69.78 3223697503.44 99.46 1 to 2 years 217460711.49 29.01 12192890.74 0.38 2 to 3 years 8858465.69 1.18 3934439.12 0.12 Over 3 years 191360.31 0.03 1423997.98 0.04 Total 749572262.00 100.00 3241248831.28 100.00 (2) As at 31 December 2022 prepayments to Top 5 suppliers amounted to RMB 341251881.85 which accounted for 45.53% of the total prepayments (2021: RMB1151298912.20 which accounted for 35.52% of the total prepayments). 142Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 6. Other receivables (1) Aging analysis of other receivables as at 31 December 2022 is as follows: 20222021 Within 1 year 1192972701.51 617564020.74 1 to 2 years 57855077.50 1762913.64 2 to 3 years 1364188.70 2737081.98 Over 3 years 18062282.93 17525165.97 Total 1270254250.64 639589182.33 Less: Provision (9096299.50) (7466239.96 ) 1261157951.14632122942.37 (2) Other receivables are classified by nature as follows: 20222021 New energy subsidy 667729527.63 409468872.96 Investment 399486432.52 26670000.00 Reserve 63703195.18 23921846.41 Margin 16618938.83 84465512.53 Other 113619856.98 87596710.47 Total 1261157951.14 632122942.37 (3) For other receivables the changes in the provision for bad debts based on 12-month expected credit losses and the entire duration of expected credit losses are as follows: Beginning Provision Reversal Write-off Ending balance balance 20227466239.961886641.46156581.92100000.009096299.50 202111821252.7968455.174205241.00218227.007466239.96 143Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 6. Other receivables (continued) (4) at 31 December 2022 top five debtors of other receivables are as follows: 2022 Amount Nature Aging Proportion of total Provision other receivables (%) First 338394118.63 New energy subsidy Within 1year 26.64 - Second 297876247.07 Equity investment Within 1year 23.45 - Third 206328464.00 New energy subsidy Within 1year 16.24 - Fourth 123006945.00 New energy subsidy Within 1year 9.68 - Fifth 101610185.45 Equity investment Within 1year 8.00 - Total 1067215960.15 84.01 - 2021 Amount Nature Aging Proportion of total Provision other receivables (%) First 358470077.96 New energy subsidy Within 1year 56.05 - Second 50998795.00 New energy subsidy Within 1year 7.97 - Third 49018367.96 Disposal income of assets Within 1year 7.66 - Fourth 33331404.62 Margin Within 1year 5.21 - Fifth 26670000.00 Equity investment Within 1year 4.17 - Total 518488645.54 81.06 - (5) For the year ended 2022 there were no accounts receivable derecognized due to transfer of financial assets. (2021: Nil). 144Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 7. Inventories (1) Classification of inventories 20222021 Balance Provision Net value Balance Provision Net value Raw materials 1230104093.50 439269923.99 790834169.51 814952436.64 313721126.17 501231310.47 Material in transit 130255961.90 - 130255961.90 355550319.54 - 355550319.54 Work in progress 1719902124.07 53609953.08 1666292170.99 2759775787.47 72995707.72 2686780079.75 Finish goods 3264190903.27 87522918.36 3176667984.91 3420908192.91 166294516.69 3254613676.22 Consigned processing material 26582772.70 - 26582772.70 29535580.80 - 29535580.80 Consumables 32674452.89 - 32674452.89 25163453.81 - 25163453.81 Total 6403710308.33 580402795.43 5823307512.90 7405885771.17 553011350.58 6852874420.59 (2) Provision for inventories 2022 Beginning balance Provision Deduction Ending balance Reversal Written off Raw materials 313721126.17 208865490.81 160368.68 83156324.31 439269923.99 Work in progress 72995707.72 48288507.37 44851.63 67629410.38 53609953.08 Finish goods 166294516.69 27948697.61 - 106720295.94 87522918.36 Total 553011350.58 285102695.79 205220.31 257506030.63 580402795.43 2021 Beginning balance Provision Deduction Ending balance Reversal Written off Raw materials 361595043.64 63699792.10 25532.23 111548177.34 313721126.17 Work in progress 74926608.94 33974479.46 25024.29 35880356.39 72995707.72 Finish goods 214237621.88 82003406.68 1522.21 129944989.66 166294516.69 Total 650759274.46 179677678.24 52078.73 277373523.39 553011350.58 (3) Note for inventory provision The Group assesses whether the cost of inventory is higher than the net realizable value and makes provision of the difference. Net realizable value is the estimated by selling price in the ordinary course of business deduct estimated costs in further production to sell and estimated necessary distribution expense and tax expense. The reversal of inventory provisions is due to price rebound of previous impaired inventories by net realizable value test while written off inventory provisions are due to selling off of previous impaired inventories in current year. 145Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 8. Contract assets 2022 Book balance Impairment Book value Contract assets 747871586.89 289482399.79 458389187.10 2021 Book balance Impairment Book value Contract assets 1320954229.34 169661981.98 1151292247.36 The movement of impairment for contract assets is as follows:： Balance at the beginning of the Provision Reverse Write off end of year balance year 2022169661981.98129619022.819798605.00-289482399.79 2021134148932.8849094830.067431781.006149999.96169661981.98 9. Other current assets 20222021 Input VAT to be deducted 803647039.82 1140996871.24 Prepaid taxes and fees 250386657.89 3078565.10 Others 745970.48 3723435.08 Total 1054779668.19 1147798871.42 146Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 10. Long-term equity investments 2022 Beginning balance Addition less Investment Other Other equity Cash dividends Ending balance Ending Income/(loss) under comprehensive variation declared balance of equity method income provision Joint Venture Changan Ford Automobile Co. Ltd. 2934876043.99 - - (1222416692.14) - - (1000000000.00) 71245 9 351.85 - Changan Mazda Automobile Co. Ltd. 1867086106.67 - - 45093349.65 - - (478875000.00) 143330 4 456.32 - Changan Mazda Engine Co. Ltd. 835121564.38 - - 30420484.67 - - (41500000.00) 82404 2 049.05 - Nanchang Jiangling Holding Co. Ltd. 1630596420.97 - - 179430391.82 602832.07 - - 181062 9 644.86 - Subtotal 7267680136.01 - - (967472466.00) 602832.07 - (1520375000.00) 478043 5 502.08 - Associates Chongqing Changan Kuayue Automobile Co. Ltd. 242792196.86 - - (33023260.52) - - - 20976 8 936.34 - Chongqing Changan Kuayue Automobile Sales Co. Ltd. (note1) - - - - - - - - - Beijing Fang’an cresent taxi Co. Ltd. (note1) - - - - - - - - - Changan Automobile Financing Co.Ltd 2520349332.44 - - 325492694.33 - - (66943616.44) 277889 8 410.33 - Hainan Anxinxing Information Technology Co. Ltd. - 368900.00 (849.01) (368050. 99) - - - - - Nanjing Chelai Travel Technology Co. Ltd. 866888.90 - - (242115.59) - - - 6 24 773.31 - Hunan Guoxin Semiconductor Technology Co. Ltd. 25285116.95 - - 167308.31 - - - 2545 2 425.26 - Jiangling Holding Co. Ltd. (note1) 70492790.08 - - (70492790.08) - - - - - Nanjing Leading Equity Investment Management Co. Ltd. (Limited Partnership) 2424143949.52 - - 146277515.18 - - - 2570421464.70 - Nanjing Leading Equity Investment Partnership 1133065.60 - - (20854.91) - - - 111 2 210.69 - Chongqing Changan New Energy Vehicles Technology Co. Ltd. 425266071.28 1360000000.00 - (1508341243.99) - 663566110.70 - 94049 0 937.99 - Zhongqi Chuangzhi Technology Co. Ltd. 190534997.15 - - (22042206.37) - - - 16849 2 790.78 - Chongqing Changxin Zhiqi Private Equity Investment Fund Partnership (Limited Partnership) 25007587.62 133187500.00 - 12244966.46 - - - 170440054.08 - Anhe Chongqing Dingfeng Auto Contractual Private Equity Investment Fund - 61744000.00 - (175293.92) - - - 61568706.08 - Avatr Technology (Chongqing) Co. Ltd. - 3611526800.00 - (966915043.54) (75815.98 ) - - 264453 5 940.48 - Chongqing Changan Innovation private Equity Investment Fund Partnership (Limited Partnership) - 1000000.00 - 844.59 - - - 1000844.59 - Chongqing Wutong Chelian Technology Co. Ltd (note1). - - - (2483334.69) - 2483334.69 - - - Anhe (Chongqing) Stock Right Investment Fund Management Co.Ltd. 2199216.74 2640640.00 - 310930.67 - - - 51 50 787.41 - Hangzhou Chelizi Intelligent Technology Co. Ltd. 9456236.58 - - (6436209.78) - - - 302 0 026.80 - Master Changan Automobile Limited 40167274.82 - - 5081370 .54 - - - 4524 8 645.36 - Subtotal 5977694724.54 5170467840.00 (849.01) (2120964774.30) (75815.98) 666049445.39 (66943616.44) 962622 6 954.20 - Total 13245374860.55 5170467840.00 (849.01) (3088437240.30) 527016.09 666049445.39 (1587318616.44) 14406662456.28 - Note 1: On 2022 December 31 the Group of Chongqing Changan Kuayue Automobile Co. Ltd. Beijing Fang’an cresent taxi Co. Ltd. Jiangling Holding Co. Ltd. and Chongqing Wutong Chelian Technology Co. Ltd. did not have the obligation to undertake extra losses so the excess loss when it occurs only the long-term equity investment was written down to zero. The excess losses related to the investment in the above three companies were not recognized. 147Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 10. Long-term equity investments (continued) 2021 Beginning balance Addition Investment Other equity Cash dividends Other Deduction Provision Ending balance Ending income under variation declared balance of equity method provision Joint Venture Changan Ford Automobile Co. Ltd. 1791533495.17 - 1143342548.82 - - - - 2934876043.99 - Changan Mazda Automobile Co. Ltd. 1995998622.28 - 417328331.92 - 173259152.47 (719500000.00 ) - 1867086106.67 - Changan Mazda Engine Co. Ltd. 832869256.44 - 41752307.94 - - (39500000.00) - 835121564.38 - Nanchang Jiangling Holding Co. Ltd. 1545807633.84 - 86068773.02 (1279985.89) - - - 1630596420.97 - Subtotal 6166209007.73 - 1688491961.70 (1279985.89 ) 173259152.47 (759000000.00 ) - 7267680136.01 - Associates Chongqing Changan Kuayue Automobile Co. Ltd. 237736134.21 - 8486062.65 - - (3430000.00 ) - 242792196.86 - Chongqing Changan Kuayue Automobile Sales Co. Ltd. (note1) - - - - - - - - - Beijing Fang’an cresent taxi Co. Ltd. (note1) - - - - - - - - - Changan Automobile Financing Co.Ltd 2337849374.75 - 247691770.61 - - (65191812.92) - 2520349332.44 - Hainan Anxinxing Information Technology Co. Ltd. (note1) 2316052.92 - (2316052.92) - - - - - - Nanjing Chelai Travel Technology Co. Ltd. 1192605.27 - (325716.37 ) - - - - 866888.90 - Hunan Guoxin Semiconductor Technology Co. Ltd. 25373809.47 - 47460.39 - - (136152.91 ) - 25285116.95 - Chongqing Wutong Chelian Technology Co. Ltd. (note1) - 3711.00 (3711.00 ) - - - - - - Anhe (Chongqing) Equity Investment Fund Management Co. Ltd. 1518177.47 - 681039.27 - - - - 2199216.74 - Hangzhou Chelizi Intelligent Technology Co. Ltd. 9692964.92 - (236728.34) - - - - 9456236.58 - Nanjing Leading Equity Investment Management Co. Ltd. (Limited Partnership) 999636607.63 741732283.00 682775058.89 - - - - 2424143949.52 - Nanjing Leading Equity Investment Partnership 1262180.39 - (129114.79 ) - - - - 1133065.60 - Pakistan Master Automobile Co. Ltd. 33550101.47 - 6617173.35 - - - - 40167274.82 - Jiangling Holding Co. Ltd. 201736644.25 - (131243854.17 ) - - - - 70492790.08 - Chongqing Changan New Energy Vehicles Technology Co. Ltd. 1991016135.19 - (1565750063.91 ) - - - - 425266071.28 - Zhongqi Chuangzhi Technology Co. Ltd. 100000000.00 100000000.00 (9465002.85) - - - - 190534997.15 - Chongqing Changxin Zhiqi Private Equity Investment Fund Partnership (Limited Partnership) - 25500000.00 (492412.38) - - - - 25007587.62 - Subtotal 5942880787.94 867235994.00 (763664091.57 ) - - (68757965.83 ) - 5977694724.54 - Total 12109089795.67 867235994.00 924827870.13 (1279985.89 ) 173259152.47 (827757965.83) - 13245374860.55 - 148Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 11. Investment in other equity instruments 2022 Accumulative changes in Fair value Dividends Income Reason for being designated fair value included in other as fair value through other comprehensive income comprehensive income China South Industry Group Finance Co. Ltd 181979200.00 339000000.00 143737363.49 Unlisted equity instruments National Innovation Center of Intelligent and connected Vehicles 2700000.00 52700000.00 73034.00 Unlisted equity instruments Guolian Automobile Power Battery Research Institute Co.Ltd. - 40000000.00 - Unlisted equity instruments China South Industries Financial Leasing Co. Ltd. 3698000.00 34250000.00 411666.67 Unlisted equity instruments Zhong Fa Lian Investment Co. Ltd. - 21000000.00 15866100.00 Unlisted equity instruments CAERI(Beijing) automobile Lightweight Technology Research Institution Co. Ltd. - 3000000.00 - Unlisted equity instruments Total 188377200.00 489950000.00 160088164.16 2021 Accumulative changes in Fair value Dividends Income Reason for being designated fair value included in other as fair value through other comprehensive income comprehensive income Corun Hybrid Power Technology Co. Ltd 5959600.00 205959600.00 - Unlisted equity instruments China South Industries Financial Leasing Co. Ltd. 174979200.00 332000000.00 70203905.15 Unlisted equity instruments Guoqi (Beijing) Intelligent Network Association Automotive Research Institute Co. Ltd. 100000.00 50100000.00 - Unlisted equity instruments Guoqi Automobile Power Cell Research Co. Ltd. 6700000.00 46700000.00 - Unlisted equity instruments China South Industry Group Financial Leasing Co. Ltd. 12098000.00 42650000.00 - Unlisted equity instruments Zhong Fa Lian Investment Co. Ltd. - 21000000.00 8296000.00 Unlisted equity instruments CAERI(Beijing) automobile Lightweight Technology Research Institution Co. Ltd. - 3000000.00 - Unlisted equity instruments Total 199836800.00 701409600.00 78499905.15 In 2022the Group disposed of investments in other equity instruments of RMB205959600.00 totaling RMB5065660.00 from other comprehensive income to retained earnings. 149Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 12. Investment property Cost Model Buildings 2022 2021 Original cost Beginning and Ending balance 10050100.00 10050100.00 Accumulated depreciation and amortization Beginning 3400673.40 3173961.84 Accrual 226711.56 226711.56 Ending 3627384.96 3400673.40 Impairment Provision Beginning and Ending - - Carrying amount Ending 6422715.04 6649426.60 Beginning 6649426.60 6876138.16 The investment property is rented to third parties in the form of operating lease.As at 31 December 2022 there was no investment property without property certificate (As at 31 December 2021: Nil). 150Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 13. Fixed assets (1) Details of fixed assets 2022 Buildings Machinery Vehicles Other Equipment Total Original cost Beginning 9881301151.22 26013931324.85 1421170657.53 9442094973.15 46758498106.75 Purchase 1265124.39 3890620.93 1608965.83 10537259.44 17301970.59 Transfer from Construction in progress 15846963.74 576973067.51 670805017.81 373187890.97 1636812940.03 Government grants 16984544.50 146643567.32 - 24611126.55 188239238.37 Disposal 52803557.15 153014327.54 109955267.54 316751699.72 632524851.95 Other deduction - - 433482.76 8742126.24 9175609.00 Ending 9828625137.70 26295137118.43 1983195890.87 9475715171.05 47582673318.05 Accumulated depreciation Beginning 2830770398.43 14770986696.00 537352883.68 4988689213.76 23127799191.87 Accrual 319496770.54 1708030839.79 228535233.82 580979774.97 2837042619.12 Disposal 26785669.57 91638342.44 52941050.82 225100138.35 396465201.18 Other deduction - - 205021.23 1225713.14 1430734.37 Ending 3123481499.40 16387379193.35 712742045.45 5343343137.24 25566945875.44 Impairment provision Beginning 99421052.16 1772417722.74 99933602.55 332966687.27 2304739064.72 Accrual 858451.71 465342187.03 763786.28 6436099.39 473400524.41 Disposal 2561175.92 47971857.94 42928054.22 15715749.88 109176837.96 Ending 97718327.95 2189788051.83 57769334.61 323687036.78 2668962751.17 Carrying amount Ending 6607425310.35 7717969873.25 1212684510.81 3808684997.03 19346764691.44 Beginning 6951109700.63 9470526906.11 783884171.30 4120439072.12 21325959850.16 151Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 13. Fixed assets (continued) (1) Details of fixed assets (continued) 2021 Buildings Machinery Vehicles Other Equipment Total Original cost Beginning 10066169441.77 26288090298.73 1226140443.01 8865870472.93 46446270656.44 Purchase 11306.95 17077558.92 3115387.73 6458371.45 26662625.05 Transfer from Construction in progress 10913289.22 56958774.50 389549047.56 647311794.62 1104732905.90 Government grants 58219853.53 280095599.82 14203669.96 29234649.46 381753772.77 Disposal 137573033.19 68099707.48 183430550.81 48311016.39 437414307.87 Ending 9881301151.22 26013931324.85 1421170657.53 9442094973.15 46758498106.75 Accumulated depreciation Beginning 2477068266.00 13020076877.36 507000274.31 4428190094.09 20432335511.76 Accrual 389459177.13 1811920566.61 118631361.81 605254490.57 2925265596.12 Disposal 35757044.70 61010747.97 88278752.44 44755370.90 229801916.01 Ending 2830770398.43 14770986696.00 537352883.68 4988689213.76 23127799191.87 Impairment provision Beginning 100679400.66 1255840090.86 124040034.63 232784768.51 1713344294.66 Accrual 6495998.00 521868181.56 556175.52 102761810.82 631682165.90 Disposal 7754346.50 5290549.68 24662607.60 2579892.06 40287395.84 Ending 99421052.16 1772417722.74 99933602.55 332966687.27 2304739064.72 Carrying amount Ending 6951109700.63 9470526906.11 783884171.30 4120439072.12 21325959850.16 Beginning 7488421775.11 12012173330.51 595100134.07 4204895610.33 24300590850.02 (2) Fixed assets that are temporarily unused On December 31 2022 fixed assets with a book value of approximately RMB 191192253.37 (December 31 2021: book value of approximately RMB 150232534.30) were temporarily idle due to product planning and other reasons. 152Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) (3) The fixed assets which are rented out under operating leases is as follow: 2022 Buildings Machinery Vehicles Total Original cost Beginning 407385917.78 193922403.14 1142516412.19 1743824733.11 Addition 2106368074.56 4818277154.51 655644459.59 7580289688.66 Deduction 24869567.09 116543579.08 107604264.51 249017410.68 Ending 2488884425.25 4895655978.57 1690556607.27 9075097011.09 Accumulated depreciation Beginning 98821531.20 68789989.43 438775091.17 606386611.80 Addition 1078562000.71 3157041669.93 193774365.75 4429378036.39 Deduction 3907592.46 52571903.60 84324631.38 140804127.44 Ending 1173475939.45 3173259755.76 548224825.54 4894960520.75 Impairment provision Beginning 13971205.80 63528839.55 - 77500045.35 Addition 400000.00 338636738.17 - 339036738.17 14371205.80402165577.72-416536783.52 Carrying amount Ending 1301037280.00 1320230645.09 1142331781.73 3763599706.82 Beginning 294593180.78 61603574.16 703741321.02 1059938075.96 153Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 13. Fixed assets (continued) (3) The fixed assets which are rented out under operating leases is as follow: 2021 Buildings Machinery Vehicles Total Original cost Beginning 262415513.45 156809971.64 896182876.14 1315408361.23 Addition 144970404.33 37112431.50 388057070.59 570139906.42 Deduction - - 141723534.54 141723534.54 Ending 407385917.78 193922403.14 1142516412.19 1743824733.11 Accumulated depreciation Beginning 76364071.98 61385064.83 415268200.97 553017337.78 Addition 22457459.22 7404924.60 108398037.71 138260421.53 Deduction - - 84891147.51 84891147.51 Ending 98821531.20 68789989.43 438775091.17 606386611.80 Impairment provision Beginning and ending balance 13971205.80 63528839.55 - 77500045.35 Carrying amount Ending 294593180.78 61603574.16 703741321.02 1059938075.96 Beginning 172080235.67 31896067.26 480914675.17 684890978.10 154Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 13. Fixed assets (continued) (4) Fixed assets without property certificate as at 31 December 2022 are as follow: Carrying amount Reason for incomplete Assembly workshop 282128369.30 In process Painting workshop 249774785.51 In process Welding workshop 185112742.30 In process Other plants 88726117.42 In process Engine workshop 69319545.23 In process Stamping Workshop 65725773.29 In process S series machine plant 56059727.15 In process H plant Phase IV 48377664.60 In process R&D Center 30473938.22 In process Yuzui Auto City 21440076.05 In process Staff cafeteria 12232566.28 In process Other supporting facilities 10170587.87 In process Emission Capability Laboratory 9115582.70 In process Office building 171633.38 In process 155Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 14. Construction in progress (1) Details of construction in progress Item 2022 2021 Balance Provision Carrying amount Balance Provision Carrying amount Mini-bus production equipment 75025377.82 - 75025377.82 110892336.09 - 110892336.09 Car production equipment 242918939.86 22624011.22 220294928.64 304941771.34 21313648.08 283628123.26 Engine plant 504558659.05 - 504558659.05 127069581.90 - 127069581.90 Vehicle research institution 17740102.50 - 17740102.50 27661450.64 - 27661450.64 Car production Project of Hefei Changan 55863516.26 - 55863516.26 13073052.88 - 13073052.88 Light vehicle project 13541208.87 - 13541208.87 20953663.84 - 20953663.84 Car-sharing project 9631578.61 - 9631578.61 721192899.46 - 721192899.46 Others 514351814.01 23108967.12 491242846.89 206083453.28 50378021.92 155705431.36 Total 1433631196.98 45732978.34 1387898218.64 1531868209.43 71691670.00 1460176539.43 The movement of impairment for construction in progress is as follows: Beginning balance Provision Write-off Ending balance 202271691670.001533334.0027492025.6645732978.34 202171352959.12558034.00219323.1271691670.00 156Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 14. Construction in progress (continued) (2) Movements of significant construction in progress in 2022 Budget Beginning balance Addition Other deduction Transfer to fixed assets The project Progress of Source of funds Ending balance (RMB0000) investments’ construction proportion of budget Mini-bus production 137470.00 110892336.09 191447800.99 - 227314759.26 62% 62% Self-funded 75025377.82 equipment Car production 360738.00 283628123.26 282894772.61 120121061.17 226106906.06 35% 35% Self-raised and additional 220294928.64 equipment issuance Self-raised and additional Engine plant 485216.00 127069581.90 507405858.99 - 129916781.84 63% 63% 504558659.05 issuance Vehicle research 209906.00 27661450.64 36536296.38 - 46457644.52 75% 75% Self-funded 17740102.50 institution Car production project of 394980.00 13073052.88 80152211.39 - 37361748.01 88% 88% Self-raised and additional 55863516.26 Hefei Changan issuance Light vehicle project 65828.00 20953663.84 58492273.87 - 65904728.84 44% 44% Self-funded 13541208.87 Car-sharing project 721192899.46 19868623.27 64969026.54 666460917.58 9631578.61 Others 155705431.36 572826869.45 - 237289453.92 491242846.89 Total 1460176539.43 1749624706.95 185090087.71 1636812940.03 1387898218.64 157Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 14. Construction in progress (continued) (2) Movements of significant construction in progress in 2021：(continued) Budget Beginning balance Addition Other Transfer to fixed assets The project Progress of Source of funds Ending balance (RMB0000) deduction investments’ construction proportion of budget Mini-bus production equipment 104349.00 17743577.36 108291158.23 - 15142399.50 63% 63% Self-funded 110892336.09 Car production Self-raised and additional equipment 335015.50 308892683.21 307662699.16 - 332927259.11 35% 35% issuance 283628123.26 Self-raised and additional Engine plant 445907.12 146394397.19 1726013.42 - 21050828.71 57% 57% issuance 127069581.90 Vehicle research institution 209906.00 38021494.37 39150347.51 - 49510391.24 73% 73% Self-funded 27661450.64 Car production project of Self-raised and additional Hefei Changan 394980.00 336334.75 21135448.23 - 8398730.10 86% 86% issuance 13073052.88 Light vehicle project 52008.34 8029777.67 47344748.00 - 34420861.83 45% 45% Self-funded 20953663.84 Car-sharing project 391178598.20 750682874.26 - 420668573.00 721192899.46 Others 137439285.95 240880007.82 - 222613862.41 155705431.36 Total 1048036148.70 1516873296.63 - 1104732905.90 1460176539.43 158Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 15. Right-of-use assets 2022 Buildings Buildings 20222021 Cost Beginning 92864546.90 55163093.63 Addition 141510763.34 37701453.27 Disposal 2689483.42 - Other deduction 78792400.21 - Ending 152893426.61 92864546.90 Accumulated depreciation Beginning 26551483.92 - Accrual 29882264.96 26551483.92 Disposal 582721.40 - Other deduction 3770986.88 - Ending 52080040.60 26551483.92 Carrying amount Ending 100813386.01 66313062.98 Beginning 66313062.98 55163093.63 159Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 16. Intangible assets 2022 Land use rights Software use Trademark use Non-patent Patent Total rights rights technology technology Original cost Beginning 2284655025.60 785360545.01 211864157.55 6643349368.90 - 9925229097.06 Purchase - 60419074.89 - - 85556571.30 145975646.19 Internal research and development - - - 1052395491.38 - 1052395491.38 Other deduction - 388564.73 - - - 388564.73 Disposal 46688334.00 - - - - 46688334.00 Ending 2237966691.60 845391055.17 211864157.55 7695744860.28 85556571.30 11076523335.90 Accumulated amortization Beginning 440258024.63 671428815.01 211786800.00 3969781572.32 - 5293255211.96 Accrual 48341991.87 55422065.44 4716.98 934762871.41 7129714.27 1045661359.97 Other deduction - 388564.73 - - - 388564.73 Disposal 20568118.91 - - - - 20568118.91 Ending 468031897.59 726462315.72 211791516.98 4904544443.73 7129714.27 6317959888.29 Impairment provision Beginning - 23617923.17 - 222358304.26 - 245976227.43 Accrual - - - 66201964.50 - 66201964.50 Ending - 23617923.17 - 288560268.76 - 312178191.93 Carrying amount Ending 1769934794.01 95310816.28 72640.57 2502640147.79 78426857.03 4446385255.68 Beginning 1844397000.97 90313806.83 77357.55 2451209492.32 - 4385997657.67 160Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 16. Intangible assets(continued) 2021 Land use rights Software use Trademark use Non-patent Total rights rights technology Original cost Beginning 2303983300.91 730114323.90 211784400.00 7564874038.93 10810756063.74 Purchase 5790686.14 55246221.11 79757.55 4716.98 61121381.78 Internal research and development - - - 1147021839.86 1147021839.86 Disposal 25118961.45 - - 2068551226.87 2093670188.32 Ending 2284655025.60 785360545.01 211864157.55 6643349368.90 9925229097.06 Accumulated amortization Beginning 402078843.59 618795694.50 205953466.62 4744811854.08 5971639858.79 Accrual 50147493.85 52633120.51 5833333.38 966237928.00 1074851875.74 Disposal 11968312.81 - - 1741268209.76 1753236522.57 Ending 440258024.63 671428815.01 211786800.00 3969781572.32 5293255211.96 Impairment provision Beginning - 23617923.17 - 383915337.04 407533260.21 Accrual - - - 165725984.32 165725984.32 Disposal - - - 327283017.10 327283017.10 Ending - 23617923.17 - 222358304.26 245976227.43 Carrying amount Ending 1844397000.97 90313806.83 77357.55 2451209492.32 4385997657.67 Beginning 1901904457.32 87700706.23 5830933.38 2436146847.81 4431582944.74 As of December 31 2022 intangible assets formed through internal research and development accounted for 56.28% of the year-end book value of intangible assets (December 31 2021: 55.89%). As of December 31 2022 there is no land use rights that have not completed the land use right certificate (December 31 2021: Nil) 161Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 17. Development expenditure 2022 Beginning balance Addition Deduction Ending balance Internal research and Recognized as Charged to income Other development intangible assets Statement of the deduction current year Automobile Development 727568248.78 1362363103.60 1052395491.38 62815604.46 251509079.07 723211177.47 2021 Beginning balance Addition Deduction Ending balance Internal research Recognized as Charged to income Other deduction and development intangible assets Statement of the current year Automobile Development 596577787.95 1311917325.01 1147021839.86 33905024.32 - 727568248.78 18. Goodwill 2022 Beginning Addition Deduction Ending balance balance Hebei Changan Automobile Co. Ltd. 9804394.00 - - 9804394.00 Nanjing Changan Automobile Co. Ltd. - - - - Avatr Technology (Chongqing) Co. Ltd. 39078794.37 - 39078794.37 - Total 48883188.37 - 39078794.37 9804394.00 2021 Beginning Addition Deduction Ending balance balance Hebei Changan Automobile Co. Ltd. 9804394.00 - - 9804394.00 Nanjing Changan Automobile Co. Ltd. - - - - Avatr Technology (Chongqing) Co. Ltd. 39078794.37 - - 39078794.37 Total 48883188.37 - - 48883188.37 The movement of provision for goodwill is as follow: 2022 and 2021 B eginning balance Addition Deduction Ending balance Nanjing Changan Automobile Co. Ltd. 73465335.00 - - 73465335.00 Due to the accumulated losses of Nanjing Changan Automobile Co. Ltd. provision for related goodwill has been fully accrued and amounted to RMB73465335.00. 162Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 19. Long-term deferred expenses Beginning balance Addition Deduction Ending balance 202215032814.1915184585.043841977.0626375422.17 202110642512.518950773.444560471.7615032814.19 20. Deferred tax assets and liabilities Deferred income tax assets and deferred income tax liabilities that are not offset: 20222021 Deferred tax assets Deductible Deferred tax assets Deductible Deferred tax assets temporary temporary differences differences Assets provision 3278951051.51 491238489.39 2777356777.37 416729166.66 Accrued expenses and contingent liabilities 8585308052.56 1298584169.65 6824636821.50 1034344964.94 Unpaid tech development expense and advertisement expense 372397166.51 55859574.98 371602577.37 55740386.60 Deferred income 2699509959.27 457007113.15 2897724045.52 434658606.83 Unpaid salary and bonus and others 4831140039.89 725797840.01 2252471662.68 339346391.96 Total 19767306269.74 3028487187.18 15123791884.44 2280819516.99 20222021 Deferred tax liabilities： Taxable temporary Deferred tax Taxable temporary Deferred tax differences liabilities differences liabilities Available-for-sale financial assets on the changes in fair value recorded in capital reserve 358180218.36 53727032.75 366226945.07 54934041.76 Fair value adjustment of business combination not under common control 204733319.00 30709997.85 223598108.60 33539716.29 Long-term equity investment 971329619.28 145699442.89 824671946.85 123700792.03 Other 46001784.40 6900267.67 35116281.93 5267442.29 Total 1580244941.04 237036741.16 1449613282.45 217441992.37 Unrecognized deductible temporary differences and tax losses of unrecognized are as follows: 20222021 The deductible temporary difference 1785535297.97 2557584132.14 The deductible tax loss 3908340793.95 7599963296.27 Total 5693876091.92 10157547428.41 163Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 20. Deferred tax assets and liabilities (continued) Note: Due to the uncertainty of whether there will be enough taxable profit in future to utilize the above deductible loss no deferred tax assets have been recognized accordingly.Maturity period for unrecognized deductible tax losses: 20222021 2022-186827208.01 2023719486343.29719486343.29 2024644243430.69644243430.69 2025669056651.63804477322.53 2026172527777.26191081327.12 2027 and beyond 1703026591.08 5053847664.63 Total 3908340793.95 7599963296.27 21. Short-term loans Classification of short-term loans： 20222021 Mortgage loans 29000000.00 19000000.00 Total 29000000.00 19000000.00 As at 31 December 2022 the interest rates of the above loans were 4.6%-4.75% (as at 31 December 2021: 4.75%).As at 31 December 2022 there was no overdue short-term loan (as at 31 December 2021: Nil).In 2022 the Group used land use rights with a book value of RMB 16823861.76 and fixed assets with a book value of RMB 29963526.50 as collateral to obtain a working capital mortgage loan of RMB 29000000.00 from the China South Industries Group Finance Co. Ltd. (2021: The Group used land use rights with a book value of RMB 17242713.12 and fixed assets with a book value of RMB 16987667.52 to obtain a liquidity mortgage loan of RMB 19000000.00 from the China South Industries Group Finance Co. Ltd.). 164Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 22. Notes payable 20222021 Commercial acceptance bill 5001155687.84 5419108409.88 Bank acceptance bill 17071638176.99 18873159961.24 Total 22072793864.83 24292268371.12 As at 31 December 2022 there is no overdue unpaid notes payable (as at 31 December 2021: Nil) 23. Accounts payable 20222021 Accounts payable 29449664138.75 23650604870.98 As at 31 December 2022 there were no significant accounts payable aged over one year (as at 31 December 2021: Nil). 24. Contract liabilities/Advances from customers 20222021 Advance payment 4808762223.46 9274445050.60 Advance service payment 846494569.20 566064463.79 Total 5655256792.66 9840509514.39 165Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 25. Payroll payable 2022 Beginning Addition Deduction Other Ending balance deduction balance Short term salary benefits 2474414390.26 8829988102.78 8546570667.33 41347085.59 2716484740.12 Defined contribution plans 89216538.26 667430841.13 665797989.33 1991640.33 88857749.73 Early retirement benefits 2940000.00 2323630.24 3447630.24 - 1816000.00 Total 2566570928.52 9499742574.15 9215816286.90 43338725.92 2807158489.85 2021 Beginning Addition Deduction Ending balance balance Short term salary benefits 1920693265.47 7623229078.65 7069507953.86 2474414390.26 Defined contribution plans 91080101.10 558047277.44 559910840.28 89216538.26 Early retirement benefits 4095000.00 2728535.70 3883535.70 2940000.00 Total 2015868366.57 8184004891.79 7633302329.84 2566570928.52 166Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 25. Payroll payable (continued) Short term salary benefits： 2022 Beginning Addition Deduction Other Ending balance deduction balance Salary bonus allowance and subsidy 2051402711.53 7146292092.31 6945040964.14 30997758.66 2221656081.04 Employee benefit 50630435.22 386349815.91 386037939.85 185939.60 50756371.68 Social insurance Medical insurance 21021344.24 395967753.79 394480490.19 1158414.89 21350192.95 Industrial injury insurance 11118683.26 40723587.86 40684896.28 54852.60 11102522.24 Maternity insurance 1382325.53 1172637.29 1159217.83 - 1395744.99 Housing accumulation fund 82772742.30 491467767.44 488154268.15 2142079.87 83944161.72 Labor fund and employee education fund 256086148.18 368014448.18 291012890.89 6808039.97 326279665.50 Total 2474414390.26 8829988102.78 8546570667.33 41347085.59 2716484740.12 2021 Beginning Addition Deduction Ending balance balance Salary bonus allowance and subsidy 1575687212.16 6202178861.73 5726463362.36 2051402711.53 Employee benefit 50451868.33 316335971.16 316157404.27 50630435.22 Social insurance Medical insurance 19319679.31 332968337.05 331266672.12 21021344.24 Industrial injury insurance 9388780.46 35224367.34 33494464.54 11118683.26 Maternity insurance 1337197.59 767729.44 722601.50 1382325.53 Housing accumulation fund 74632036.37 386080540.13 377939834.20 82772742.30 Labor fund and employee education fund 189876491.25 349673271.80 283463614.87 256086148.18 Total 1920693265.47 7623229078.65 7069507953.86 2474414390.26 167Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 25. Payroll payable (continued) Defined contribution plans： 2022 Beginning Addition Deduction Other Ending balance balance Deduction Basic retirement security 79483988.05 646286750.65 644976261.42 1763392.69 79031084.59 Unemployment insurance 9732550.21 21144090.48 20821727.91 228247.64 9826665.14 Total 89216538.26 667430841.13 665797989.33 1991640.33 88857749.73 2021 Beginning Addition Deduction Ending balance balance Basic retirement security 82228882.36 539914162.66 542659056.97 79483988.05 Unemployment insurance 8851218.74 18133114.78 17251783.31 9732550.21 Total 91080101.10 558047277.44 559910840.28 89216538.26 The salary bonus allowance and subsidy employee benefits and other social insurances mentioned above are paid in time according to related laws and regulations and sets of the Group. 26. Taxes payable 20222021 Value-added tax 655162944.40 226203631.00 Consumption tax 378822293.63 677686833.74 Corporate income tax 550250134.24 105632071.69 City maintenance and construction tax and 106797577.85 40480950.08 Others 58913132.20 71309911.01 Total 1749946082.32 1121313397.52 168Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 27. Other payables 20222021 Purchase and construction of fixed assets intangible 1190478260.12949561307.22 assets and engineering deposits Customer and supplier margin 839653876.07 614910836.94 New energy vehicle subsidiaries 697956559.00 - Advanced receipt of land and plant disposal fees 635268035.18 - Treasury stock repurchase 627060416.52 655812327.60 Advertisement fees 505569065.16 890826555.71 Storage fees and freight 382409902.25 159463618.29 Maintenance fees 278765596.52 212946188.78 Capital increase from third parties received in advance -253750000.00 by subsidiaries Others 925604713.85 825355510.15 Total 6082766424.67 4562626344.69 28. Contingent liabilities 2022 Beginning Addition Deduction Ending Warranty 3295272783.50 1595486879.87 738758003.06 4152001660.31 Contingent liabilities of contract performance 543742894.34 26346680.32 132791913.48 437297661.18 Total 3839015677.84 1621833560.19 871549916.54 4589299321.49 2021 Beginning Addition Deduction Ending Warranty 2555699406.23 1573355355.84 833781978.57 3295272783.50 Contingent liabilities of contract performance 569471536.23 144904107.11 170632749.00 543742894.34 Total 3125170942.46 1718259462.95 1004414727.57 3839015677.84 29. Non-current liability within 1 year 20222021 Long-term loan within 1 year 604000000.00 354300000.00 Long-term payables within 1 year 244429325.65 154593759.05 Lease liabilities within 1 year 37294575.69 24945824.52 885723901.34533839583.57 Non-current liability within 1 year refer to refer to Note V 31 33 and 34. 169Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 30. Other current liabilities 20222021 Accrued commercial discount payable 3837216057.38 3367324452.66 Accrued market development expense 1004950610.70 808031552.57 Accrued transportation fee 728264657.72 729390155.06 Accrued technology royalty 534463454.23 342675110.58 Accrued labor service fee 107051967.02 63197022.32 Accrued integrated services fee 87715544.50 79555300.00 Accrued utilities 60370787.91 48068943.51 Accrued negative points for fuel consumption 59308609.28 33239495.00 Others 207702978.88 209476997.52 Total 6627044667.62 5680959029.22 31. Long-term Loan 20222021 Credit loan 640000000.00 954300000.00 Deduction: Loan within 1 year 604000000.00 354300000.00 Net long-term borrowings 36000000.00 600000000.00 As at 31 December 2022 the interest rates of the above loans were 1.00%-3.00% (as at 31 December 2021: 1.00%- 3.00%). As at 31 December 2022 there is no overdue long-term loans (as at 31 December 2021: Nil). 32. Bonds Payable 20222021 Corporate Bonds 999528301.88 - In December 2022 the Company publicly issued technology innovation corporate bonds (Phase I) to professional investors with a face value of RMB1000000000.00 a coupon rate of 3% simple interest payable annually the interest payment date is December 20 of each year from 2023 to 2027 and the final redemption date is December 202027. 33. Lease liabilities 20222021 Lease liabilities 97499973.67 63625560.11 Less：Lease liabilities within 1 year 37294575.69 24945824.52 60205397.9838679735.59 170Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 34. Long-term payables 20222021 Long-term payables 408939511.34 642513537.69 Special payables 144579238.78 182959952.39 Total 553518750.12 825473490.08 Long-term payables: 20222021 Purchase of fixed assets 653368836.99 797107296.74 Less：Long-term payables within 1 year 244429325.65 154593759.05 Total 408939511.34 642513537.69 Special payables: 2022 Beginning Addition Deduction Ending Land relocation compensation of Nanjing changan 55350709.40 - 55350709.40 - Intelligent manufacturing project 82777201.36 6169200.00 34823429.36 54122972.00 Lightweight design of automobile structure 18903766.50 4900000.00 9393208.56 14410557.94 Others 25928275.13 71133518.47 21016084.76 76045708.84 Total 182959952.39 82202718.47 120583432.08 144579238.78 2021 Beginning Addition Deduction Ending Land relocation compensation of Nanjing changan 55350709.40 - - 55350709.40 Intelligent manufacturing project 131865237.97 38618400.00 87706436.61 82777201.36 Lightweight design of automobile structure 6914468.49 24922500.00 12933201.99 18903766.50 Others 67130512.84 18126077.00 59328314.71 25928275.13 Total 261260928.70 81666977.00 159967953.31 182959952.39 171Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 35. Long-term payroll payable 20222021 Net obligation of defined benefit plan 29227000.00 30917000.00 Early retirement 5786000.00 8186000.00 Total 35013000.00 39103000.00 In addition to basic retirement security and unemployment insurance which are managed by local government the Group offers different kinds of overall pension and annual compensation to some retired employees until their death. The Group provides subsidies to former military personnel who participated in specific wars and offers large medical treatment insurance for all retired personnel. The Group also offered early-retired salary social insurances and housing accumulation fund with different standards until their formal retirement (Male: Age 60; Female: Age 50 or 55). These amounts of social insurances and housing accumulation fund are based on cost base and statutory proportion.The present value of the defined benefits plans is valued by expected cumulative welfare units determination which was ensured by Aon Enterprise Solutions Shanghai Co Ltd. at 31 December 2022. The related plans recognized in the profit and loss of the defined benefit plan are as follows: 20222021 Service costs- current period 56000.00 47000.00 Net interest 818000.00 964000.00 Net post-employment benefit costs 874000.00 1011000.00 Recorded in general administrative expenses 874000.00 1011000.00 Movement of present value of defined benefits plan is as follows: Defined Benefit Plan Obligation 20222021 Beginning balance 30917000.00 30832000.00 Charged to income Statement of the current period Service costs- current period 56000.00 47000.00 Interest expense net 818000.00 964000.00 Actuarial losses charged to other comprehensive income (112000.00) 1519000.00 Benefits Payment (2452000.00) (2445000.00 ) Ending balance 29227000.00 30917000.00 172Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 36. Deferred income 2022 2021.12.31 Addition Deduction Other deduction 2022.12.31 Government grants related to assets 224903605.46 185504839.57 188239238.37 - 222169206.66 Government grants related to gains 699846125.66 - 299235506.09 275211276.61 125399342.96 924749731.12185504839.57487474744.46275211276.61347568549.62 2021 2020.12.31 Addition Deduction 2021.12.31 Government grants related to assets 205752282.46 400905095.77 381753772.77 224903605.46 Government grants related to gains 612646147.76 599550000.00 512350022.10 699846125.66 818398430.221000455095.77894103794.87924749731.12 As at 31 December 2022 details of liabilities related to government grants are as follows: 2021.12.31 Addition Deduction 2022.12.31 Related to assets: 224903605.46 185504839.57 188239238.37 222169206.66 Production and construction subsidies 158141323.00 185504839.57 177229238.37 166416924.20 Other government subsidies 66762282.46 - 11010000.00 55752282.46 Related to gains: 699846125.66 - 574446782.70 125399342.96 R&D technology subsidies 569842539.65 - 448091782.38 121750757.27 Other government subsidies 130003586.01 - 126355000.32 3648585.69 Total 924749731.12 185504839.57 762686021.07 347568549.62 173Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 36. Deferred income (continued) As at 31 December 2021 details of liability related to government grants are as follows(Restated)： 2021.12.31 Addition Deduction 2022.12.31 Related to assets: 205752282.46 400905095.77 381753772.77 224903605.46 Production and construction subsidies 150000000.00 389895095.77 381753772.77 158141323.00 Other government subsidies 55752282.46 11010000.00 - 66762282.46 Related to gains: 612646147.76 599550000.00 512350022.10 699846125.66 R&D technology subsidies 356547561.96 599000000.00 385705022.31 569842539.65 Other government subsidies 256098585.80 550000.00 126644999.79 130003586.01 Total 818398430.22 1000455095.77 894103794.87 924749731.12 37. Other non-current liabilities 20222021 Advance service payment 1728721535.34 1352292332.21 Deduction: Advance service payment within 1 year 846494569.20 566064463.79 882226966.14786227868.42 174Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 38. Share capital 2022 movement Beginning Issuance of shares Stock dividend Transfer of reserve to Others Sub-total Ending common shares I. Restricted shares 1 Shares held by state-owned legal persons 396393645.00 - - 118918093.00 - 118918093.00 515311738.00 2 Other domestic shareholdings 122490320.00 - - 36747096.00 10950.00 36758046.00 159248366.00 Including： shares held by domestic legal persons - - - - - - - shares held by domestic natural persons 122490320.00 - - 36747096.00 10950.00 36758046.00 159248366.00 3 Foreign shareholdings 934900.00 - - 280470.00 - 280470.00 1215370.00 Total of restricted shares 519818865.00 - - 155945659.00 10950.00 155956609.00 675775474.00 II. Unrestricted shares 1 RMB ordinary shares 5849553939.00 - - 1754866182.00 (10950.00 ) 1754855232.00 7604409171.00 2 Foreign-funded shares listed domestically 1262780598.00 - - 378834179.00 - 378834179.00 1641614777.00 Total of unrestricted shares 7112334537.00 - - 2133700361.00 (10950.00 ) 2133689411.00 9246023948.00 III. Total shares 7632153402.00 - - 2289646020.00 - 2289646020.00 9921799422.00 Note: According to the Company's 2021 profit distribution and capital reserve conversion plan to increase share capital the Company will increase the capital reserve to all shareholders by 3 shares for every 10 shares increasing the share capital by RMB 2289646020.00 and reducing the capital reserve by RMB 2289646020.00. 175Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 38. Share capital (continued) 2021 movement Beginning Issuance of shares Stock dividend Transfer of reserve to Others Sub-total Ending common shares I. Restricted shares 1 Shares held by state-owned legal persons 283138318.00 - - 113255327.00 - 113255327.00 396393645.00 2 Other domestic shareholdings 244917965.00 93956600.00 - 30485720.00 (245935065.00 ) (122427645.00 ) 122490320.00 Including： shares held by domestic legal persons 244899065.00 - - - (244899065.00 ) (244899065.00 ) - shares held by domestic natural persons 18900.00 93956600.00 - 30485720.00 (1036000.00 ) 122471420.00 122490320.00 3 Foreign shareholdings 32710280.00 - - - (32710280.00 ) (31775380.00 ) 934900.00 Total of restricted shares 560766563.00 93956600.00 - 143741047.00 (278645345.00 ) (40947698.00 ) 519818865.00 II. Unrestricted shares 1 RMB ordinary shares 3900643469.00 - - 1671301125.00 277609345.00 1948910470.00 5849553939.00 2 Foreign-funded shares listed domestically 901986142.00 - - 360794456.00 - 360794456.00 1262780598.00 Total of unrestricted shares 4802629611.00 - - 2032095581.00 277609345.00 2309704926.00 7112334537.00 III. Total shares 5363396174.00 93956600.00 - 2175836628.00 (1036000.00 ) 2268757228.00 7632153402.00 176Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 39. Capital reserves 2022 Beginning Addition Deduction Ending Share premium 8774823352.59 - 2289646020.00 6485177332.59 Share-based payments 268539867.92 380209900.00 - 648749767.92 Capital reserve transferred arising from the old standards 44496899.00 - - 44496899.00 Restricted capital reserve of equity investments 17015985.20 - - 17015985.20 Others (Note 1) 671317255.67 666049445.39 - 1337366701.06 Total 9776193360.38 1046259345.39 2289646020.00 8532806685.77 Note 1: In 2022 the increase in other capital reserves was mainly due to the absorption of new investments by Chongqing Changan New Energy Automobile Technology Co. Ltd. an associate of the Company. 2021 Beginning Addition Deduction Ending Share premium 10364453940.59 589873480.00 2179504068.00 8774823352.59 Share-based payments - 268539867.92 - 268539867.92 Capital reserve transferred arising from the old standards 44496899.00 - - 44496899.00 Restricted capital reserve of equity investments 17015985.20 - - 17015985.20 Others (Note 1) 504815093.85 166502161.82 - 671317255.67 Total 10930781918.64 1024915509.74 2179504068.00 9776193360.38 177Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 40. Treasury stock 2022 Beginning Addition Deduction Ending Treasury stock 655812327.60 - 28751911.08 627060416.52 2021 Beginning Addition Deduction Ending Treasury stock - 683830080.00 28017752.40 655812327.60 Note: The decrease in treasury shares for the year was due to the Group's distribution of dividends to incentive recipients during the year. 41. Other comprehensive income Accumulated other comprehensive income in consolidated balance sheet attributable to parent company is as follows: 2022 2021.12.31 Movement 2022.12.31 Re-measurement of changes in defined benefit plans (297000.00 ) 112000.00 (185000.00 ) Other comprehensive income that cannot be transferred to profit or loss under the equity method (3368053.89 ) 602832.07 (2765221.82 ) Other comprehensive income on convertible gains and losses under the equity method - (75815.98) (75815.98 ) Changes in the fair value of other equity instrument investments 169861280.00 (9740660.00) 160120620.00 Translation difference of foreign currency financial statements (96753756.58 ) 38500789.80 (58252966.78 ) Total 69442469.53 29399145.89 98841615.42 2021 2020.12.31 Movement 2021.12.31 Re-measurement of changes in defined benefit plans 1222000.00 (1519000.00) (297000.00) Other comprehensive income that cannot be transferred to profit or loss under the equity method (2088068.00 ) (1279985.89) (3368053.89) Changes in the fair value of other equity instrument investments 161854620.00 8006660.00 169861280.00 Translation difference of foreign currency financial statements (82567831.22 ) (14185925.36 ) (96753756.58) Total 78420720.78 (8978251.25) 69442469.53 178Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 41. Other comprehensive income (continued) Current occurrence amount of other comprehensive income in consolidated income statement attributable to parent company: 2022 Amount before tax Deduct: amounts Deduct: amounts Deduct: Income Amount attributable to Amount attributable transferred to income transferred to tax owners to minority interests statement which were retained earnings recognized in other which were comprehensive income recognized in other in prior period comprehensive income in prior period Other comprehensive income not to be reclassified to profit or loss in subsequent period Change in net liability or assets from defined benefit plan (112000.00 ) - - - (112000.00 ) - Other comprehensive income that cannot be transferred to profit or loss under the equity method (602832.07 ) - - - (602832.07 ) - Fair value change of Investment in other equity instruments 5500000.00 - (5065660.00 ) 825000.00 9740660.00 - Subtotal 4785167.93 - (5065660.00 ) 825000.00 9025827.93 - Other comprehensive income will be reclassified to profit or loss in subsequent period - Other comprehensive income which can convert to gain and loss under the equity method 75815.98 - - - 75815.98 - Foreign currency translation difference (37775975.99 ) 722897.12 - - (38500789.80 ) 1916.69 Subtotal (37700160.01 ) 722897.12 - - (38424973.82 ) 1916.69 Total (32914992.08 ) 722897.12 (5065660.00 ) 825000.00 (29399145.89 ) 1916.69 179Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 41. Other comprehensive income (continued) 2021 Amount before tax Deduct: amounts Deduct: Income tax Amount attributable to owners Amount attributable to transferred to income minority interests statement which were recognized in other comprehensive income in prior period Other comprehensive income not to be reclassified to profit or loss in subsequent period Change in net liability or assets from defined benefit plan 1519000.00 - - 1519000.00 - Other comprehensive income that cannot be transferred to profit or loss under the equity method 1279985.89 - - 1279985.89 - Fair value change of Investment in other equity instruments (9419600.00 ) - (1412940.00 ) (8006660.00 ) - Subtotal (6620614.11 ) - (1412940.00 ) (5207674.11 ) - Other comprehensive income will be reclassified to profit or loss in subsequent period Foreign currency translation difference 14166694.21 - - 14185925.36 (19231.15) Subtotal 14166694.21 - - 14185925.36 (19231.15) Total 7546080.10 - (1412940.00 ) 8978251.25 (19231.15 ) 180Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 42. Special reserves 2022 Beginning Addition Deduction Ending Safety fund 27988260.61 104696987.95 108594350.51 24090898.05 2021 Beginning Addition Deduction Ending Safety fund 40847443.41 85032433.05 97891615.85 27988260.61 The special reserve is the safety production fee accrued by the Group in accordance with the Administrative Measures for the Withdrawal and Use of Enterprise Safety Production Expenses (Caizi [2022] No. 136) promulgated by the Ministry of Finance and the Ministry of Emergency Response on 21 November 2022. 43. Surplus reserves 2022 Beginning Addition Deduction Ending Statutory surplus 2982292413.67 545845221.86 - 3528137635.53 2021 Beginning Addition Deduction Ending Statutory surplus 2681698087.00 300594326.67 - 2982292413.67 The Company appropriated statutory surplus reserves based on profit after tax. When statutory surplus reserves account for 50% of paid-in capital no further surplus reserve will be appropriated. 181Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 44. Retained earnings 20222021 Retained earnings at beginning of the year 35900674525.13 34315048892.26 Add: Profits attributable to parent company for the current year 7798451093.72 3552463320.03 Add: Other comprehensive income transferred to retained earnings 5065660.00 - Less: Appropriation to statutory surplus reserves 545845221.86 300594326.67 Less: Ordinary share dividend of cash 1778856191.54 1666243360.49 Retained earnings at the end of year 41379489865.45 35900674525.13 According to the decision of the fifty-sixth meeting of the eighth session of the company’s board of directors the 2022 profit distribution plan is: based on the total share capital of 9921799422.00 shares on the date of announcement to distribute cash of RMB2.36 (including tax) for every 10 shares to all shareholders totaling the distribution cash RMB 2341544663.59 (tax included). The above plan is yet to be reviewed and approved by the company's general meeting of shareholders. 45. Operating revenue and cost 20222021 Revenue Cost Revenue Cost Main business 117565143198.95 94573428488.62 102696170307.57 86348567579.13 Other business 3687720886.45 1836182385.14 2445706929.48 1300137955.01 Total 121252864085.40 96409610873.76 105141877237.05 87648705534.14 Operating revenue listed as follows: 20222021 Sale of goods 114066406439.25 99238618010.70 Provide labor and other services 7186457646.15 5903259226.35 Total 121252864085.40 105141877237.05 The breakdown of operating revenue generated from contracts with customers is as follows: 182Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 45. Operating revenue and cost (continued) 20222021 Revenue recognition time Recognize revenue at a certain point in time 120203760630.11 104253879828.51 Recognize revenue within a certain period of time 1049103455.29 887997408.54 Total 121252864085.40 105141877237.05 The income recognized in the current year and included in the book value of contract liabilities at the beginning of the year is as follows: 20222021 Sales of goods 9274445050.60 3779593859.42 Provision of services and others 566064463.79 154187357.35 Total 9840509514.39 3933781216.77 The estimated time when the total transaction price that has not been fulfilled (or partially fulfilled) performance obligations allocated to the end of the year is recognized as revenue is as follows: 20222021 Within 1 year 5655256792.66 9840509514.39 More than 1 year 882226966.14 786227868.42 Total 6537483758.80 10626737382.81 46. Tax and surcharges 20222021 Consumption tax 3022759216.21 3002762967.36 City maintenance and construction tax 454863299.03 373005368.21 Educational surcharge 229702527.01 188365736.49 Others 394522780.25 408298968.39 Total 4101847822.50 3972433040.45 183Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 47. Operating expenses 20222021 Sales service fee 2132352506.82 1657420104.39 Promotion advertising fee 1760645464.70 1872615623.45 Payroll and welfare 718415703.07 570208149.45 Transportation and storage fees 296302707.75 347165629.82 Travelling expenses 71192697.52 71196292.69 Package expenses 42180208.06 35130297.34 Consulting fee 31870498.85 7580858.70 Training fee 27499082.32 29950509.42 Others 57811293.86 54386769.33 Total 5138270162.95 4645654234.59 48. General and administrative expenses 20222021 Payroll and welfare 2361704245.03 2239444389.16 Share-based payments 380209900.00 268539867.92 Administrative expenses 342662496.31 351316057.92 Depreciation and amortization 209021291.13 196426684.61 Traffic expenses 54685498.40 43244134.99 Travelling expenses 7465840.51 16681419.45 Negative points for fuel consumption - 175899501.68 Others 176708927.38 208102452.76 Total 3532458198.76 3499654508.49 49. Research and development expenses 20222021 Payroll and welfare 1744089751.78 1320641894.55 Depreciation and amortization 1221653901.00 1223956918.63 Subcontract fee 580052391.93 339472444.83 Material fee 192475951.44 168390304.98 Test fee 109549382.65 135140093.55 Others 467623485.96 327427522.22 Total 4315444864.76 3515029178.76 184Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 50. Financial income 20222021 Interest income 1014346758.69 868952893.13 Less: Foreign exchange gain or loss (79104476.10 ) 16412404.08 Interest expense 48683490.36 45160385.56 Others 27462001.35 26456906.31 Total 1017305743.08 780923197.18 51. Other income 2022 2021 Amount recognized in 2021 as non-recurring profit and loss Government subsidies related to daily activities 529819888.31 330174796.23 529819888.31 Government subsidies related to daily activities are as follows: 20222021 Production and construction subsidies 385172523.26 248073126.32 Other government subsidies 144647365.05 82101669.91 529819888.31330174796.23 52. Investment income 20222021 Long-term equity investment income/(loss) accounted for by the equity method (3060648491.82) 924827870.13 The investment income of financial asset held for trading during its holding period 3289610.51 3363000.00 Dividend income from remaining investments in other equity instruments 160088164.16 78499905.15 Gains from the remeasurement of the remaining equity at fair value after the loss of control 2128313646.36 - Interest income from entrusted loan - 6959316.00 Total (768957070.79) 1013650091.28 185Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 53. Fair value change 20222021 Equity instrument investment (25737569.00) (3026700.00 ) Others 29307798.29 45105504.00 Total 3570229.29 42078804.00 54. Impairment loss of credit 20222021 Bad debt for account receivable 30511950.73 27187650.40 Bad debt for other receivables 1730059.54 (4136785.83) Total 32242010.27 23050864.57 55. Impairment loss on assets 20222021 Impairment of inventory 284897475.48 179625599.51 Impairment of contract assets 119820417.81 41663049.06 Impairment of fixed assets 473400524.41 631682165.90 Impairment of intangible assets 66201964.50 165725984.32 Impairment of construction in progress 1533334.00 558034.00 Total 945853716.20 1019254832.79 56. Gain on disposal of assets 2022 2021 Amount recognized in 2022 as non- recurring profit and loss Gain on disposal of fixed-assets 74862481.00 745601530.26 74862481.00 186Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 57. Non-operating income 2022 2021 Amount recognized in 2021 as non- recurring profit and loss Fines penalties and others 128910416.79 130170270.12 128910416.79 58. Non-operating expenses 2022 2021 Amount recognized in 2022 as non-recurring profit and loss Donation 19172451.80 16259600.00 19172451.80 Fines and penalties 1168042.33 6225500.39 1168042.33 Others 34050545.66 17599796.21 31050545.66 Total 54391039.79 40084896.60 51391039.79 59. Government grants The government grants accounted by the Group with the net method offset the book value of relevant assets and related costs as follows: 20222021 Government grants related to assets Write down:Fixed assets 188239238.37 381753772.77 Government grants related to income Write down:Operating cost 87580801.54 169371137.15 Operating expenses 4958904.12 9941452.49 General and administrative expenses 62862742.73 30312480.16 Research and development expenses 179583821.24 521570527.20 Financial income - 91000.00 For other government grants refer to notes V 51. 187Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 60. Income tax expense 20222021 Current income tax expense 689928709.52 265219161.46 Deferred income tax expense (726353981.40) (48828515.71 ) Total (36425271.88 ) 216390645.75 The relationship between income tax expense and profit/(loss) before tax is as follows: 20222021 Profit before tax 7708257084.09 3820608835.73 Tax at the applicable tax rate 1156238562.61 573091325.37 Impact of different tax rates of subsidiaries 44322786.54 65824174.22 Adjustments to current income tax of previous period (34234083.88 ) (28003351.23 Profit or loss attributable to joint ventures and associates 484159369.97 (37003883.24) Non-taxable income (347606111.09 ) (13064084.90) Non-deductible tax expense 17534017.22 10747006.40 Usage previous deductible losses (689321898.12 ) (104980345.46) Unrecognized deductible temporary differences and deductible losses (121558547.51 ) 209941859.03 Additional deduction arising from research and development expense (480741014.87 ) (460162054.44) Changes in the applicable tax rate for deferred tax assets (65218352.75 ) - Tax expense under actual tax rate of the Group (36425271.88 ) 216390645.75 188Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 61. Earnings per share (“EPS”) 20222021 Basic EPS Going concern 0.7960 0.3616 Diluted EPS Going concern 0.7799 0.3579 The basic EPS is calculated by dividing the net profit of the current period attributable to the ordinary shareholders of the Company by the weighted average number of outstanding ordinary shares.The numerator of diluted earnings per share is determined based on the current net profit attributable to the ordinary shareholders of the company after adjusting the following factors: (1) the interest of diluted potential ordinary shares that have been recognized as expenses in the current period; (2) The proceeds or expenses that will be incurred upon conversion of diluted potential ordinary shares; (3) the income tax impact related to the above adjustment.The denominator of diluted earnings per share is equal to the sum of the following two items: (1) the weighted average number of ordinary shares issued by the parent company in the basic earnings per share; (2) the weighted average number of ordinary shares increased by assuming the conversion of diluted potential ordinary shares into ordinary shares.When calculating the weighted average number of ordinary shares increased by the conversion of diluted potential ordinary shares into issued ordinary shares the diluted potential ordinary shares issued in previous periods are assumed to be converted at the beginning of the current period; Diluted potential ordinary shares issued in the current period are assumed to be converted on the issuance date. In 2022 the restricted stock incentive plan implemented by the company diluted earnings per share.Note: According to the plan of converting capital reserve into share capital approved by the general meeting of shareholders in July 2022 the Company converted 3 shares for every 10 shares with capital reserve. Accordingly basic earnings per share and diluted earnings per share for each presentation period are calculated on an adjusted share basis. For details of the conversion of capital reserve into share capital see Note 5 and 38. 62. Notes to cash flow statement (1) Items of cash received relating to other operating activities are as follows: 20222021 Interest income 1014346758.69 868952893.13 Government grants 711835358.28 1580573924.48 Others 715500477.90 818167877.71 Total 2441682594.87 3267694695.32 189Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 62. Notes to cash flow statement (continued) (2) Items of cash paid relating to other operating activities are as follows: 20222021 Selling expense 4057275191.41 2851733499.00 Administrative expense 594849261.20 635117562.52 Research and development expenses 951048522.32 1146120474.66 Others 762523853.82 466423185.72 Total 6365696828.75 5099394721.90 (3) Items of cash received relating to other investing activities are as follows: 20222021 Entrusted loan received - 300000000.00 Total - 300000000.00 (4) Items of cash received relating to other investing activities are as follows: 20222021 Cash transferred out from the loss of control of the subsidiary 815126333.76 - (5) Items of cash received relating to other financing activities are as follows: 20222021 Withdraw for deposit of bill 1705726148.77 836125136.66 (6) Items of cash paid relating to other financing activities are as follows: 20222021 Payment for deposit of bill 328638801.53 1967854026.77 Repurchase restricted share - 4703440.00 Others 43924444.07 36951674.28 Total 372563245.60 2009509141.05 190Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 63. Supplementary information of cash flow statement (1) Supplementary information of cash flow statement Cash flows from operating activities calculated by adjusting the net profit: 20222021 Net profit 7744682355.97 3604218189.98 Add: Impairment provision for assets 978095726.47 1042305697.36 Depreciation of fixed assets 2837042619.12 2925265596.12 Right-of-use assets depreciation 29882264.96 26551483.92 Depreciation and amortization of investment property 226711.56 226711.56 Amortization of intangible assets 1045661359.97 1074851875.74 Amortization of long-term deferred expense 3841977.06 4560471.76 Increase/(decrease) in deferred income (113730666.52 ) 464611919.67 Disposal income on fixed assets intangible assets and others long-term assets (74862481.00 ) (745601530.26) Loss/(income) of abandonment of fixed assets - 964155.31 Income of fair value movement (3570229.29) (42078804.00) Financial expense 8976404.49 45450807.95 Investment income/(loss) 768957070.79 (1013650091.28) Increase in deferred tax assets (747667670.19 ) (149552839.47) Increase/(decrease) in inventory 744669432.21 (1064983789.53) Deferred income tax liabilities Increased/(decreased) 21313688.79 100724323.76 Increase/(decrease) in operating receivables (10855537441.91 ) 2050313410.12 Increase in operating payables 2901766217.54 14395488567.44 Share-based payments cost 380209900.00 268539867.92 Others (3610381.50 ) (16482813.23) Net cash flows from operating activities 5666346858.52 22971723210.84 Movement of cash and cash equivalents: Ending balance of cash 52491435047.74 49517916834.99 Less: beginning balance of cash 49517916834.99 30655968057.63 Increase in cash and cash equivalents 2973518212.75 18861948777.36 191Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 63. Supplementary information of cash flow statement (continued) (2) Endorsement of bills: 20222021 Endorsed bank acceptance received by sales and providing service 10213830689.47 5101549250.90 (3) Cash and cash equivalents 20222021 Cash Including: Cash 32155.77 36881.35 Bank deposits that can be readily used 52455913791.28 49517879953.64 Other cash and cash equivalents that can be 35489100.69 readily used - Cash equivalents - - Ending balance of cash and cash equivalents 52491435047.74 49517916834.99 Note: The restricted cash and cash equivalents of the Group are not included in the cash and cash equivalents. 64. The assets with ownership or right restricted 2022 2021 Notes Cash and cash equivalents 1038748779.60 2458325314.38 Note V 1 Note receivables 6340255963.00 7207264940.74 Note V 3(2) Intangible assets 16823861.76 17242713.12 Note V 21 Fixed assets 29963526.50 16987667.52 Note V 21 7425792130.869699820635.76 192Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 65. Foreign Monetary Item 20222021 Original Currency Exchange Translated to RMB Original Currency Exchange Translated to RMB Rate Rate Cash USD 56180945.38 6.9646 391277812.22 57387026.02 6.3757 365882461.80 GBP 3256961.22 8.3941 27339258.18 5209847.34 8.6064 44838030.15 EUR 10611483.98 7.4229 78767984.44 9516883.92 7.2197 68709046.84 JPY 92191272.00 0.0524 4826950.62 179758385.00 0.0554 9961310.90 SUR 5653760.56 0.0942 532404.26 1529465059.95 0.0855 130719040.37 BRL - 1.3174 - 571122.09 1.1443 653558.85 Accounts receivable USD 40416598.13 6.9646 281485439.30 36727588.87 6.3757 234164088.36 Other receivables USD 31960.50 6.9646 222592.10 32000.00 6.3757 204022.40 JPY 14581471.00 0.0524 763456.66 13365572.00 0.0554 740653.17 EUR 1685080.00 7.4229 12508180.33 1587999.00 7.2197 11464876.38 GBP 466250.99 8.3941 3913757.44 606906.32 8.6064 5223278.55 Accounts Payable JPY 13886600.00 0.0524 727074.60 - 0.0554 - EUR 2821453.00 7.4229 20943363.47 - 7.2197 - GBP 41575.10 8.3941 348985.55 - 8.6064 - SUR 16777602.67 0.0942 1579916.07 - 0.0855 - USD 59626.10 6.9646 415271.94 - 6.3757 - Other Payables USD 1175603.03 6.9646 8187604.86 33900.00 6.3757 216136.23 GBP 209186.02 8.3941 1755928.37 11860.01 8.6064 102071.99 EUR - 7.4229 - 7790.84 7.2197 56247.53 193Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) VI Changes in the scope of consolidation 1. Disposition of subsidiaries Registration Nature of Shareholding Proportion of Reason of dispo place business Ratio of the Group voting rights of sition （%） the Group （%） Production and The introduction AVATR Technology (Chongqing) sales of new of investors leads Co. Ltd. ("AVATR Technology") energy vehicles to dilution of ChongQing and parts 39.018% 39.018% equity According to the capital increase agreement signed by the Company with Shanghai NIO Automobile Co. Ltd. CATL New Energy Technology Co. Ltd. Fujian Mindong Times Rural Investment and Development Partnership (Limited Partnership) Chongqing Chengan Private Equity Investment Fund Partnership (Limited Partnership) Chongqing Liangjiang Xizheng Equity Investment Fund Partnership (Limited Partnership) Southern Industrial Asset Management Co.Ltd. and Chongqing Southern Industrial Equity Investment Fund Partnership (Limited Partnership) (Collectively referred to as “investors”) the Company and the investors increased their capital to AVATR Technology by RMB 500000000.00 and RMB 1920000000.00 respectively for a total capital increase of RMB 2420000000.00. After the completion of the capital increase the investors held a total of 60.9820% of the equity of AVATR Technology the equity of AVATR Technology held by the Company decreased from 95.38% to 39.0180% and AVATR Technology was changed from a subsidiary of the Company to an associate. As of the completion date of the capital increase (March 11 2022) the Group will no longer include AVATR Technology in the scope of the merger. 194Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 1. Disposition of subsidiaries (Continued) The relevant financial information of Avita Technology is set out below: 2022/3/112021/12/31 Book Value Book Value Current Assets 2542310614.22 1018554547.61 Non-Current Asset 454396428.20 288663663.28 Current Liability 483860747.75 1193023674.26 Non-Current Liability 328229166.81 309005514.38 Shareholder’s Equity 2184617127.86 (194810977.75 ) Less: Capital Increase 2420000000.00 Less: Minority interests (10874688.69 ) The Company’s share of net assets on the date of disposal (224508183.45 ) Add:Capital Increase from this company 500000000.00 Add:Goodwill 39078794.37 Less:Other comprehensive income transferred out 357457.28 314213153.64 Fair Value of Residual Equity 2442526800.00 Disposal income 2128313646.36 The operating results of AVATR Technology from January 12022 to the completion date of capital increase are listed as follows : 2022/1/1-2023/3/11 Operating Revenue - Operating Costs - Net loss (40527007.50 ) 195Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) VII Shares in other entities 1. Shares in subsidiaries The subsidiaries of the Company are as follows： Company name Main Registered Nature of Registered Total proportion of operating place business capital shareholders (%) place (0000) direct indirect I.The subsidiary formed by establish or investment Chongqing Changan International Automobile Sales Co.Ltd. Chongqing Chongqing Sales 20375.64 100.00 - Chongqing Changan Connected Car Technology Co. Ltd. Chongqing Chongqing Lease 8850.00 100.00 - Chongqing Changan Special Automobile Co. Ltd.(note 2) Chongqing Chongqing Sales 2000.00 50.00 - Changan Brazil Holdings Limited (note 3) St. Paul Brazil St. Paul Brazil Sales BRL100 99.00 1.00 Chongqing Changan Automobile Supporting Service Co. Ltd. Chongqing Chongqing Sales 3000.00 99.00 1.00 Chongqing Changan New Energy Automobile Co. Ltd. Chongqing Chongqing R&D 2900.00 100.00 - Chongqing Changan Europe Design Academy Co. Ltd. Turin Italy Turin Italy R&D EUR1738 100.00 - Nottingham Nottingham Changan United Kingdom R&D Center Co. Ltd. United United Kingdom Kingdom R&D GBP2639 100.00 - Beijing Changan R&D Center Co. Ltd. Beijing Beijing R&D 100.00 100.00 - Yokohama Yokohama Changan Japan Designing Center Co.Ltd.Japan Japan R&D JPY1000 100.00 - Troy United Detriot Changan United States R&D Center Co. Ltd.states United states R&D USD154 100.00 - Moscow Changan Automobile Russia Co. Ltd.Moscow Russia Russia Sales SUR220382 100.00 - Changan Automobile Investment (Shenzhen) Co. Ltd. Shenzhen Shenzhen Sales 23789.00 100.00 - Nanjing Changan New Energy Automobile Sales & Service Co.Ltd. Nanjing Nanjing Sales 5000.00 100.00 - Chongqing Anyi Automobile Technical Service Co. Ltd. Chongqing Chongqing Sales 200.00 100.00 - Xiamen Changan New Energy Automobile Co. Ltd. Xiamen Xiamen Sales 200.00 100.00 - Guangzhou Changan New Energy Automobile Co. Ltd. Guangzhou Guangzhou Sales 400.00 100.00 - Chongqing Chehemei Technology Co. Ltd. Chongqing Chongqing Sales 1000.00 100.00 - Chongqing Changan Kaicheng Automobile Technology Co. Ltd. Chongqing Chongqing Sales 100000.00 83.64 - Chongqing Changan Automobile Software Technology Co. Ltd. Chongqing Chongqing R&D 9900.00 100.00 - Chongqing Xingzhi Technology Co. Ltd. Chongqing Chongqing Sales 4900.00 100.00 - Chongqing Changan Technology Co. Ltd. Chongqing Chongqing R&D 9000.00 100.00 - II.Subsidiaries acquired through business combinations not under common control Nanjing Changan Automobile Co. Ltd. (note 1) Nanjing Nanjing Manufacturing 60181.00 84.73 - Chongqing Changan Lingyao Automobile Co. Ltd. Chongqing Chongqing Manufacturing 133764.00 100.00 - III.The subsidiary formed by business combination under common control Hefei Changan Automobile Co.Ltd. Hefei Hefei Manufacturing 227500.00 100.00 - Note 1: The proportion of the company's voting rights in Nanjing Changan Automobile Co. Ltd. is 91.53%. The reason for the inconsistency between the shareholding ratio and the proportion of voting rights is that some minority shareholders entrust the company to exercise their voting rights.Note 2: The remaining shareholders of Chongqing Changan Special Purpose Vehicle Co. Ltd. have signed the "Concerted Acting Persons Agreement" with the company all agreeing to vote in accordance with the company's voting intentions so the company can exercise control over it so it is included in the scope of consolidated financial report.Note 3: In 2022 Changan Brazil Holding Co. Ltd. was liquidated and canceled.As at 31 December 2022 the Group has no subsidiaries with important minority interests. 196Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 2. Shares in joint ventures and associates Company name Main Registered Nature of business Registered Total proportion of Accounting operating place capital shareholders (%) treatment place (0000) direct indirect I. Joint ventures Changan Ford Automobile Co. Ltd. Chongqing Chongqing Manufacture and sale of automobiles and components USD24100 50.00 - The equity method Changan Mazda Automobile Co. Ltd. Nanjing Nanjing Manufacture and sale of automobiles and components USD11681 47.50 - The equity method Changan Mazda Engine Co. Ltd. Nanjing Nanjing Manufacture and sale of automobiles and components USD20996 50.00 - The equity method Nanchang Jiangling Investment Co. Ltd. Nanchang Nanchang Management of investment industry and assets 100000 50.00 - The equity method 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 - The equity method Chongqing Changan Kuayue Automobile Sales Co.Ltd. Sale of Changan Kuayue’ s automobile and agricultural cars and components. Technical advisory Chongqing Chongqing services for automobile 300 34.30 - The equity method Chongqing Changan New Energy Vehicles Technology Co. Ltd. Chongqing Chongqing Production and sales of new energy vehicles and parts 32811 40.6559 - The equity method Beijing Fang’an cresent taxi Co. Ltd. Beijing Beijing Regional taxi operation 2898 22.24 - The equity method Provide car loan; provide vehicle loans and operating equipment loans to car dealers including Changan Automobile Finacing Co. Ltd. the construction loans of exhibition hallspare parts loans and maintenance equipment loans Chongqing Chongqing etc. 476843 28.66 - The equity method Hainan Anxinxing Information Technology Co. Ltd. (note 1) Chengmai Chengmai Software and hardware technology development technical consulting auto parts sales 3000 30.00 - The equity method Nanjing Chelai Travel Technology Co. Ltd. Nanjing Nanjing Car sales leasing software technology development technical services 10000 10.00 - The equity method Coresing Semiconductor Technology Co. Ltd. Technology development consulting technical services technology transfer in the field of Zhuzhou Zhuzhou power semiconductors 50000 25.00 - The equity method Chongqing Wutong Chelian Technology Co. Ltd. Chongqing Chongqing Technology development transfer and consulting services 56056 - 27.05 The equity method Anhe (Chongqing) Equity Investment Fund Management Co. Ltd. Chongqing Chongqing Equity investment management 1260 - 44.44 The equity method Hangzhou Chelizi Intelligent Technology Co. Ltd. Hangzhou Hangzhou Car travel service 630 - 20.00 The equity method Master Changan Motors Ltd. (note 2) Pakistan Pakistan Car travel service PKR75000 - 30.00 The equity method Jiangling Holding Co. Ltd. Nanchang Nanchang Production and sales of automobiles and auto parts 200000 25.00 - The equity method Nanjing Leading Equity Investment Partnership (Limited Equity investment venture capital; investment in non-publicly traded equity such as non-listed Partnership) Nanjing Nanjing companies 'equity listed companies' non-publicly issued equity and related services. 976000 16.39 - The equity method Nanjing Leading Equity Investment Management Co. Ltd. Entrusted with the management of private equity investment funds engaged in equity Nanjing Nanjing investment management and related services 1000 15.00 - The equity method Zhongqi Chuangzhi Technology Co. Ltd. Nanjing Nanjing R&D 1600000 3.125 - The equity method Chongqing Changxin Zhiqi Private Equity Investment Fund Partnership (Limited Partnership) Chongqing Chongqing Private equity 50200 49.80 - The equity method AVATR Technology (Chongqing) Co. Ltd. Chongqing Chongqing Production and sales of new energy automobiles and auto parts 164466 40.9939 - The equity method Anhe Chongqing Dingfeng Auto Contractual Private Equity Investment Fund Chongqing Chongqing Private equity 15436 40.00 - The equity method Chongqing Changan Innovation Private Equity Investment Fund Partnership (Limited Partnership) Chongqing Chongqing Private equity 65100 46.08 - The equity method 197Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 2. Shares in joint ventures and associates (Continued) Note 1 : In 2022 Hainan Anxinxing Information Technology Co. Ltd. was liquidated and cancelled.Note 2 : The former Pakistan Master Automobile Co. Ltd. has been renamed Master Changan Automobile Limited.Note 3 : In March 2022 Avita Technology ( Chongqing ) Co. Ltd. completed the capital increase and equity expansion to introduce new investors. After the completion of the capital increase it changed from a subsidiary to an associate.Changan Ford Automobile Co. Ltd. is the important joint venture to the Group and makes great influence in the share of profit and loss in joint venture and associates the Group adopts equity method to deal with the investment to it.The table below shows the financial status of Changan Ford Automobile Co. Ltd. and all the information has been adjusted to eliminate the difference of the accounting policies. 20222021 Current assets 15159099717.00 13985198069.00 Including: cash and cash equivalent 6818327323.00 5495088974.00 Non-current assets 20859166829.00 26699638722.00 Total assets 36018266546.00 40684836791.00 Current liabilities 26771621602.00 28816791001.00 Non-current liabilities 7716321374.00 5889087187.00 Total liabilities 34487942976.00 34705878188.00 Minority interests - - Equity attributable to owners 1530323570.00 5978958603.00 Net asset owned according to share proportion 765161785.00 2989479301.50 Adjustment (52702433.15) (54603257.51) Book value of investment 712459351.85 2934876043.99 Operating revenue 51066908933.00 61765317548.00 Financial expenses- interest income 127367165.00 117633590.00 Financial expenses- interest expense 326852062.00 453750578.00 Income tax expense 1343872002.00 235034761.00 Net profit/ (loss) (2448635033.00) 2283913708.00 198Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 2. Shares in joint ventures and associates (continued) The table below shows the financial status of the less important joint ventures and associates: 20222021 Joint venture Total book value of the investment 4067976150.23 4332804092.02 Total amount calculated by shareholding proportion Net profit 254944226.14 545149412.88 Other comprehensive income 602832.07 (1279985.89) Total comprehensive income 255547058.21 543869426.99 Associates Total book value of the investment 9626226954.20 5977694724.54 Total amount calculated by shareholding proportion Net profit (2120964774.30) (763664091.57) Other comprehensive income (75815.98) - Total comprehensive income (2121040590.28) (763664091.57) As at 31 December 2022 since the Group has no obligation to undertake the extra loss of Chongqing Changan Kuayue Automobile Sales Co. Ltd Beijing Fang’an cresent taxi Co. Ltd.Chongqing Wutong Chelian Technology Co. Ltd and Jiangling Motors Co. Ltd.. When extra loss occurs the Group writes down the long-term investment to zero without recognizing the extra loss. 199Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) VIII 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 2022 Financial assets Financial assets Financial assets measured Total measured at fair value measured at amortized at fair value and whose and whose changes are cost changes are recorded in recorded in the current Other comprehensive profit and loss (standard income (specified) required) Cash - 53530183827.34 - 53530183827.34 Financial assets for trading 280315571.09 - - 280315571.09 Notes receivable - 35849660652.96 - 35849660652.96 Accounts receivable - 3068414415.29 - 3068414415.29 Other receivables - 861671518.62 - 861671518.62 Other current assets - 745970.48 - 745970.48 Investment in other equity instrument - - 489950000.00 489950000.00 Total 280315571.09 93310676384.69 489950000.00 94080941955.78 2021 Financial assets Financial assets Financial assets measured Total measured at fair value measured at amortized at fair value and whose and whose changes are cost changes are recorded in recorded in the current Other comprehensive profit and loss (standard income (specified) required) Cash - 51976242149.37 - 51976242149.37 Financial assets for trading 195798300.00 - - 195798300.00 Notes receivable - 24267633416.65 - 24267633416.65 Accounts receivable - 1675427534.87 - 1675427534.87 Other receivables - 632122942.37 - 632122942.37 Other current assets - 3723435.08 - 3723435.08 Investment in other equity instrument - - 701409600.00 701409600.00 Total 195798300.00 78555149478.34 701409600.00 79452357378.34 200Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 1. Classification of financial instruments (continued) Financial liabilities Financial liabilities measured at amortized cost 20222021 Short-term loans 29000000.00 19000000.00 Notes payable 22072793864.83 24292268371.12 Accounts payable 29449664138.75 23650604870.98 Other payables 4749541830.49 4562626344.69 Non-current liabilities due within 1 year 885723901.34 533839583.57 Long-term loan 36000000.00 600000000.00 Lease liabilities 60205397.98 38679735.59 Long-term payables 408939511.34 642513537.69 Bonds payable 999528301.88 - Total 58691396946.61 54085782443.64 2. Transfer of financial assets The transferred financial assets that entirely derecognized but continuing involved As at 31 December 2022 the Group has endorsed acceptance bill with a carrying amount of RMB5294424281.62 (31 December 2021: RMB2391567055.84) 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 may exercise the right of recourse against any one several or all of the debtors of the bill including the Group regardless of the order of the debtors of the bill (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.In 2022 the Group didn’t recognize profit or loss on the transferring date. No revenue or expense should be recognized in accordance with the continuing involvement in the current period. The indorsement occurred flatly in this period. 201Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 3. Risks of financial instruments The Group faces risks of various financial instruments in its daily activities mainly including credit risk liquidity risk and market risk (including exchange rate risk interest rate risk and price risk).The main financial instruments of the Group include monetary funds equity investments loans bills receivable accounts receivable bills payable accounts payable lease liabilities etc. The risks associated with these financial instruments and the risk management strategies adopted by the Group to reduce these risks are described below.The Group has formulated risk management policies to identify and analyze the risks faced by the Group set appropriate risk acceptance levels and design corresponding internal control procedures to monitor the Group's risk levels. The Group will periodically re-examine these risk management policies and related internal control systems to adapt to changes in market conditions or the Group ’s operating activities. The internal audit department also regularly and irregularly checks whether the implementation of the internal control system complies with the risk management policy.Credit risk The Group only deals with recognized and reputable customers. In accordance with the Group's policy a credit review is required for all customers who require credit transactions. In addition the Group continuously monitors the balance of accounts receivable to ensure that the Group does not face significant bad debt risk. For transactions that are not settled with the relevant business unit's bookkeeping standard currency the Group does not provide credit transaction conditions unless specifically approved by the Group's credit control department.Since the counterparties of monetary funds and bank acceptance receivables are reputable banks with higher credit ratings these financial instruments have lower credit risk.With respect to credit risk arising from the other financial assets of the Group which comprise accounts receivable 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 2022 there was no credit risk arising from financial guarantee.Since the Group only trades with approved and reputable customers there is no need for collateral. Credit risk is centralized and managed according to customers. As at the balance sheet date the Group has a specific concentration of credit risks. 56.83% of the Group's accounts receivable (December 31 2021: 48.92%) originated from the top five customers with the balance of accounts receivable. The Group does not hold any collateral or other credit enhancements for the balance of accounts receivable. 202Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 3. Risks of financial instruments (continued) Credit risk (continued) Judgment criteria for significant increase in credit risk The Group evaluates on each balance sheet date whether the credit risk of the relevant financial instruments has increased significantly since the initial recognition. In determining whether credit risk has increased significantly since the initial recognition the Group considers that reasonable and evidence-based information can be obtained without unnecessary additional cost or effort including qualitative and quantitative analysis based on the Group's historical data external credit risk ratings and forward-looking information. Based on a single financial instrument or a portfolio of financial instruments with similar credit risk characteristics the Group compares the default risk of financial instruments on the balance sheet date with the default risk on the initial confirmation date to determine the change of default risk of financial instruments during their expected duration.When one or more of the following quantitative or qualitative criteria are triggered the Group believes that the credit risk of financial instruments has significantly increased: * the quantitative criterion is that the default probability of the remaining duration on the report date increases by more than a certain percentage compared with the initial confirmation; * qualitative criteria mainly include material adverse changes in the operating or financial situation of the debtor early warning customer list etc.; Definition of assets that have incurred credit impairment In order to determine whether credit impairment occurs the Group adopts a definition standard consistent with the internal credit risk management objectives for relevant financial instruments and considers both quantitative and qualitative indicators. The Group mainly takes the following factors into consideration when evaluating whether the debtor has credit impairment: * significant financial difficulties of the issuer or debtor; * debtor breaches the contract such as default or overdue payment of interest or principal; * the creditor gives the debtor concessions that the debtor would not have made under any other circumstances for economic or contractual reasons 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 result in the disappearance of an active market for the financial asset; * purchase or source a financial asset at a substantial discount that reflects the fact that a credit loss has occurred.The credit impairment of financial assets may be caused by the joint action of multiple events but not by events that can be identified separately. 203Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 3. Risks of financial instruments (continued) 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.The table below summarizes the maturity profile of the Group’s financial liabilities based on the non-discounted cash flow of the contracts: 2022 Within 1 year 1 to 2 years 2 to 3 years Over 3 years Total Short-term loans 29621345.00 - - - 29621345.00 Notes payable 22072793864.83 - - - 22072793864.83 Accounts payable 29449664138.75 - - - 29449664138.75 Other payable 4749541830.49 - - - 4749541830.49 Non-current liabilities due within 1 year 907011961.68 - - - 907011961.68 Long-term loan - 360000.00 36090000.00 - 36450000.00 Lease liabilities - 28446270.64 13141937.62 23324609.18 64912817.44 Long-term payables - 195656936.33 192710708.33 36552833.33 424920477.99 Bonds payable 30000000.00 30000000.00 30000000.00 1060000000.00 1150000000.00 Total 57238633140.75 254463206.97 271942645.95 1119877442.51 58884916436.18 2021 Within 1 year 1 to 2 years 2 to 3 years Over 3 years Total Short-term loans 19795625.00 - - - 19795625.00 Notes payable 24292268371.12 - - - 24292268371.12 Accounts payable 23650604870.98 - - - 23650604870.98 Other payable 4308876344.69 - - - 4308876344.69 Non-current liabilities due within 1 year 586179931.75 - - - 586179931.75 Long-term loan - 609000000.00 - - 609000000.00 Lease liabilities - 28962720.73 12810301.90 763259.70 42536282.33 Long-term payables - 212672500.00 212672500.00 248724166.67 674069166.67 Total 52857725143.54 850635220.73 225482801.90 249487426.37 54183330592.54 204Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 3. Risks of financial instruments (continued) Market risk Interest rate risk The Group’s revenue and operating cash flows are seldomly influenced by the interest fluctuation.As at 31 December 2022 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 2022 the Group only has transactional currency exposures of 7.33% (2021: 5.41%) 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 price risk of equity instrument investment refers to the risk that the fair value of equity securities is reduced due to changes in the level of stock indexes and changes in the value of individual securities. On December 31 2022 the Group's listed equity instrument investment (Note V. 2) was listed on the Shanghai Stock Exchange and measured on the basis of market quotes on the balance sheet date. The following table illustrates the sensitivity of the Group’s net profit and loss to every 5% change in the fair value of equity instrument investments (based on the book value at the balance sheet date) under the assumption that all other variables remain constant. 2022 Carrying amount of Change in fair Increase/ Increase/ equity instrument value (decrease) in net (decrease) in equity investments profit Shanghai- Equity investment included in financial assets at fair value through profit or loss 126112500.00 5% 5359781.25 5359781.25 Shanghai- Equity investment included in financial assets at fair value through profit or loss 126112500.00 (5% ) (5359781.25 ) (5359781.25) Shenzhen- Equity investment included in financial assets at fair value through profit or loss 125052628.80 5% 5314736.72 5314736.72 Shenzhen- Equity investment included in financial assets at fair value through profit or loss 125052628.80 (5% ) (5314736.72 ) (5314736.72 ) 205Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 3. Risks of financial instruments (continued) Market risk(continued) Equity instruments investment price risk (continued) 2021 Carrying amount of Change in fair Increase/ Increase/ equity instrument value (decrease) in net (decrease) in equity investments profit Shanghai- Equity investment included in financial assets at fair value through profit or loss 177902700.00 5% 7560864.75 7560864.75 Shanghai- Equity investment included in financial assets at fair value through profit or loss 177902700.00 (5% ) (7560864.75 ) (7560864.75) 4. Capital management The main goal of the Group’s capital management is to ensure that the ability of continuous operation and maintain 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 2022 and 2021.The Group’s leverage ratio on the balance sheet date is as follows: 31 December 2022 31 December 2021 Leverage ratio 56.90% 58.74% 206Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) IX Disclosure of fair value 1. Assets and liabilities measured at fair value 2022 Input measured at fair value Quoted price in Important and Important but Total active market observable input unobservable input (The first level) (The second (The third level)level） Financial asset held for trading Equity instrument investment 126112500.00 125052628.80 - 251165128.80 Others - 29150442.29 - 29150442.29 Investment in other equity instruments - - 489950000.00 489950000.00 Total 126112500.00 154203071.09 489950000.00 770265571.09 2021 Input measured at fair value Quoted price in Important and Important but Total active market observable input unobservable input (The first level) (The second (The third level)level） Financial asset held for trading Equity instrument investment 177902700.00 - - 177902700.00 Others - - 17895600.00 17895600.00 Investment in other equity instruments - - 701409600.00 701409600.00 Total 177902700.00 - 719305200.00 897207900.00 2. Fair value estimation Management has assessed and concluded accounts including cash notes receivable accounts receivable other receivables other payables notes payable and accounts payable and so on whose fair value equals to book value because of its short term to overdue.Financial assets and financial liabilities are measured at the amount that an asset could be exchanged for or by which a liability could be incurred or settled by knowledge willing parties in a current arm’s-length transaction other than liquidation or unwilling sales. Methods and hypothesis followed are used for determining fair value. 207Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 2. Fair value estimation (continued) Long-term loans and long-term payables use discounted cash flow method to determine its fair value with discount rate in accordance with market return of other financial instruments based on similar terms credit risks and remaining terms. As at 31 December 2022 the default risk of long-term loans and short-term loans were considered immaterial.The equity instruments listed by the Group are ordinary shares with unrestricted sale conditions and their fair value is determined at the quoted market price. The Group's unlisted equity instruments use a series of valuation models to estimate the fair value and the assumptions used are not supported by observable market prices or interest rates. The Group mainly refers to the evaluation reports of independent qualified professional appraisers. The Group believes 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.The Group entered into a derivative financial instrument contract with the bank. The Group's derivative financial instruments are foreign exchange forward contracts which are measured using valuation techniques similar to the present value method. The observable input value of the market covered by the model is the forward exchange rate. The book value of a foreign exchange forward contract is the same as the fair value. 3. Unobservable input The following is an overview of the important unobservable input value of the third level fair value measurement: Fair value Valuation techniques Non-observable input value Investment in other equity instrument Comparable transaction value 2022 489950000.00 Market approach multiplier / Post-tax discount rate Comparable transaction value 2021 701409600.00 Market approach multiplier / Post-tax discount rate Financial asset held for trading-Others Expected yield contained in the 2021 17895600.00 Expected yield as per the contract contract 208Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) X Related party relationships and transactions 1. The holding company Holding company Place of Registered capital Nature of the business Proportion of Proportion of registration shares in the voting rights in Company the company Automobile and its engines spare parts China Changan Automobile Group manufacturing Co. Ltd. Beijing 6092273400.00 marketing 20.80% 20.80% The ultimate holding company is China South Industries Group Corporation. 2. Subsidiaries Refer to Note VII 1 for details of the Group’s subsidiaries. 3. Joint ventures and associates Refer to Note VII 2 for details of the Group’s joint ventures and associates. 209Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 4. Other related parties Related parties Relationship Anhui Wanyou Automobile Sales Service Co. Ltd. Controlled by the same ultimate holding company Chengdu Huachuan Electric Equipment Co. Ltd. Controlled by the same ultimate holding company Chengdu Wanyou Auto Trade Service Co. Ltd. Controlled by the same ultimate holding company Chengdu Wanyou Xiangyu Auto Sales and Service Co. Ltd. Controlled by the same ultimate holding company Guizhou Wanyou Auto Sales and Service Co. Ltd. Controlled by the same ultimate holding company Harbin Dongan Auto Engine Co. Ltd. Controlled by the same ultimate holding company Harbin Dongan Automotive Engine Manufacturing Co. Ltd. Controlled by the same ultimate holding company Jiangsu Wanyou Automobile Sales Service Co. Ltd. Controlled by the same ultimate holding company Sichuan Jian'an Industrial Co.Ltd. Controlled by the same ultimate holding company Sichuan Ningjiang Shanchuan Machinery Co Ltd. Controlled by the same ultimate holding company Ya'an Wanyou Auto Sales and Service Co. Ltd. Controlled by the same ultimate holding company Yunnan Wanyou Auto Sales and Service Co. Ltd. Controlled by the same ultimate holding company Yunnan Wanxing Automobile Sales and Service Co. Ltd Controlled by the same ultimate holding company China Changan Automobile Group Tianjin Sales Co. Ltd. Controlled by the same ultimate holding company Chongqing Tsingshan Industrial Co. Ltd. Controlled by the same ultimate holding company Chongqing Wanyou Ducheng Auto Sales Service Co. Ltd. Controlled by the same ultimate holding company Chongqing Wanyou Economic Development Co. Ltd. Controlled by the same ultimate holding company Chengdu Jialing Huaxi Optical & Precision Machinery Co. Ltd. Controlled by the same ultimate holding company Chengdu Lingchuan Vehicle Oil Tank Co. Ltd. Controlled by the same ultimate holding company Chengdu Wanyou Filter Co. Ltd. Controlled by the same ultimate holding company Hubei Huazhong Marelli Automobile Lighting Co. Ltd. Controlled by the same ultimate holding company Hubei Xiaogan Huazhong Automobile Light Co. Ltd. Controlled by the same ultimate holding company Yunnan Xiyi Industries Co. Ltd. Controlled by the same ultimate holding company Chongqing Dajiang Jiexin Forging Co. Ltd. Controlled by the same ultimate holding company Chongqing Jianshe Automobile Air-conditioner Co. Ltd. Controlled by the same ultimate holding company 210Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 4. Other related parties (continued) Related parties Relationship Chongqing Construction Tongda Industrial Co. Ltd. Controlled by the same ultimate holding company Chongqing Shangfang Automobile Fittings Co. Ltd. Controlled by the same ultimate holding company Chongqing Yihong Defense Technology Co. Ltd Controlled by the same ultimate holding company Chongqing Changan Industries Group Co. Ltd. Controlled by the same ultimate holding company Chongqing Changan Property Management Co. Ltd. Controlled by the same ultimate holding company Chongqing Changan Intelligent Industrial Technology Service Co. Ltd. Controlled by the same ultimate holding company Longchang Shanchuan Precision Welded Tube Co. Ltd. Controlled by the same ultimate holding company Chongqing Changrong Machinery Co. Ltd. Controlled by the same ultimate holding company Controlled by the same ultimate holding company Southwest Ordnance Industry Chongqing Environmental Protection Research Institute Co. Ltd Chongqing Qingshan Transmission Sales Co. Ltd. Controlled by the same ultimate holding company Beijing Beiji Mechanical and Electrical Industry Co. Ltd. Controlled by the same ultimate holding company Chongqing Wanyou Zunda Automobile Sales & Service Co. Ltd. Controlled by the same ultimate holding company Panzhihua Wanyou Auto Sales & Service Co. Ltd. Controlled by the same ultimate holding company Luzhou Wanyou Automobile Service Co. Ltd. Controlled by the same ultimate holding company Chengdu Wanyou Trading Co. Ltd. Controlled by the same ultimate holding company Chongqing Wanyou Xingjian Auto Sales & Service Co. Ltd. Controlled by the same ultimate holding company Chengdu Wanyou Auto Sales and Service co.Ltd. Controlled by the same ultimate holding company Chongqing Pingshan Tk Carburetor Co. Ltd. Controlled by the same ultimate holding company Chongqing Wanyou Zhicheng Automobile Sales and Service Co. Ltd Controlled by the same ultimate holding company Chongqing Jianshe Industry (Group) Co. Ltd. Controlled by the same ultimate holding company Chongqing Changan Construction Co. Ltd. Controlled by the same ultimate holding company Bazhong Wanyou Auto Sales & Service Co. Ltd. Controlled by the same ultimate holding company China South Industries Group Information Center Co. Ltd. Controlled by the same ultimate holding company Chongqing Changfeng Jiquan Machinery Co. Ltd. Controlled by the same ultimate holding company 211Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 4. Other related parties (continued) Related parties Relationship Wanyou Automobile Investment Co. Ltd. Controlled by the same ultimate holding company China South Industries Group Financial Leasing Co. Ltd. Controlled by the same ultimate holding company Chongqing Anfu Automobile Co. Ltd. Controlled by the same ultimate holding company China South Industries Group Commercial Factoring Co. Ltd. Controlled by the same ultimate holding company China Changan Automobile Group Hefei Investment Co. Ltd. Controlled by the same ultimate holding company China South Industry Group Finance Co. Ltd. Controlled by the same ultimate holding company Ya'an Changan Affordable Housing Construction Co. Ltd. Controlled by the same ultimate holding company Chongqing Dajiang Xinda Vehicles Shares Co. Ltd. Controlled by the same ultimate holding company Chongqing Jialing Yimin Special Equipment Co. Ltd. Controlled by the same ultimate holding company Chongqing Jianshe Mechanical & Electrical Equipment Co. Ltd. Controlled by the same ultimate holding company Chongqing Xiyi Automobile Connecting Rod Co. Ltd. Controlled by the same ultimate holding company Chengdu Lingchuan Special Industry Co. Ltd. Controlled by the same ultimate holding company Chongqing Automobile Air-conditioner Co. Ltd. Controlled by the same ultimate holding company Guangxi Wanyou Auto Sales and Service Co. Ltd. Controlled by the same ultimate holding company Dali Wanfu Automobile Sales and Service Co. Ltd Controlled by the same ultimate holding company SIAMC Management Co. Ltd. Controlled by the same ultimate holding company Chengdu Ningjiang Zhaohe Automobile Components Co. Ltd. Participated by the Ultimate holding company Southern Fojiya Auto Parts Co. Ltd. Participated by the Ultimate holding company South Tianhe Chassis System Co. Ltd. Participated by the Ultimate holding company South Inter Air-conditioner Co.Ltd. Participated by the Ultimate holding company Chongqing Changan Minsheng Logistics Co. Ltd. Participated by the Ultimate holding company Chongqing Nexteer Steering System Co.Ltd. Participated by the Ultimate holding company Lear Changan (Chongqing) Automotive System Co. Ltd. Participated by the Ultimate holding company United Automotive Electronis Systems (Chongqing) Co. Ltd. Participated by the Ultimate holding company 212Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 4. Other related parties (continued) Related parties Relationship Gkn Huayu Driveline Systems(chongqing) Co. Ltd. Participated by the Ultimate holding company Tenneco Lingchuan (Chongqing) Exhaust System Company Ltd. Participated by the Ultimate holding company Chongqing Dajiang Tongyang Plastics Co. Ltd. Participated by the Ultimate holding company Chongqing Dajiang Guoli Precision Machinery Manufacturing Co. Ltd. Participated by the Ultimate holding company Dajiang Yapp Automotive Systems Co. Ltd. Participated by the Ultimate holding company Chongqing Hanon Jianshe Automotive Thermal Systems Co. Ltd. Participated by the Ultimate holding company Chongqing Lingchuan Auto Parts Manufacturing Technology Co. Ltd. Participated by the Ultimate holding company Chongqing Dajiang Yuqiang Plastic Co. Ltd. Participated by the Ultimate holding company Beijing Zhongbing Insurance Brokerage Co. Ltd. Participated by the Ultimate holding company Hunan Tyen Machinery Co. Ltd. Participated by the Ultimate holding company Changan Reis (Chongqing) Robotic Intelligent Equipment Co. Ltd. Participated by the Ultimate holding company Chongqing Chang'an Minsheng Boyu Logistics Co. Ltd. Participated by the Ultimate holding company Nanjing CMSC Logistics Co. Ltd. Participated by the Ultimate holding company Hafei Motor Co. Ltd. Participated by the Ultimate holding company Chengdu Zhongzi Guangming Catalytic Technology Co. Ltd Participated by the Ultimate holding company Nanjing LingHang Technology Co. Ltd. Companies in which the company participates Jiangling Motors Co. Ltd Companies in which the company participates Ald Fortune Auto Leasing & Renting (Shanghai) Co. Ltd. Companies in which the company participates Beijing Wutong Chelian Technology Co. Ltd. Companies in which the company participates 213Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 5. Major transactions between the Group and its related parties (1) Transactions of goods and services Purchases of goods and services from related parties Related parties Nature of the transaction 2022 2021 Chongqing Tsingshan Industrial Co. Ltd. Purchase of spare parts and accept service 5929105477.16 4785993498.79 Chongqing Changan New Energy Vehicles Technology Co. Ltd. Purchase of spare parts and accept service 4693770740.03 1157433115.64 Chongqing Changan Minsheng Logistics Co. Ltd. Purchase of spare parts and accept service 3463898449.23 2367887858.81 Harbin Dongan Automotive Engine Manufacturing Co. Ltd. Purchase of spare parts and accept service 1059383069.06 1470076695.64 Hubei Huazhong Marelli Automobile Lighting Co. Ltd. Purchase of spare parts 1000676703.53 1103986382.45 South Tianhe Chassis System Co. Ltd. Purchase of spare parts and accept service 850217286.61 855650728.58 Chongqing Nexteer Steering System Co.Ltd. Purchase of spare parts and accept service 831405194.98 772763837.57 United Automotive Electronis Systems (Chongqing) Co. Ltd. Purchase of spare parts and accept service 822043773.13 514909546.70 Sichuan Jian'an Industrial Co.Ltd. Purchase of spare parts and accept service 797061806.68 833678868.10 Harbin Dongan Auto Engine Co. Ltd. Purchase of spare parts and accept service 510666022.83 737712816.89 Southern Fojiya Auto Parts Co. Ltd. Purchase of spare parts and accept service 474902181.20 522797081.51 Chengdu Huachuan Electric Equipment Co. Ltd. Purchase of spare parts and accept service 433491184.42 419242322.52 South Inter Air-conditioner Co.Ltd. Purchase of spare parts 417113793.15 429818507.26 Lear Changan (Chongqing) Automotive System Co. Ltd. Purchase of spare parts 398441173.61 626890790.17 Chongqing Dajiang Tongyang Plastics Co. Ltd. Purchase of spare parts and accept service 390094811.70 157108911.96 Subtotall of this page 22072271667.32 16755950962.59 214Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 5. Major transactions between the Group and its related parties (continued) (1) Transactions of goods and services (continued) Purchases of goods and services from related parties (continued) Related parties Nature of the transaction 2022 2021 Dajiang Yapp Automotive Systems Co. Ltd. Purchase of spare parts 367878744.52 339075086.11 Chongqing Dajiang Guoli Precision Machinery Manufacturing Co. Ltd. Purchase of spare parts 353842435.47 276472478.63 Gkn Huayu Driveline Systems(chongqing) Co. Ltd. Purchase of spare parts 349384726.01 329353847.13 Sichuan Ningjiang Shanchuan Machinery Co Ltd. Purchase of spare parts 236368439.32 218229152.25 Chongqing Changrong Machinery Co. Ltd. Purchase of spare parts 188542642.58 208657447.92 Chongqing Wutong Chelian Technology Co. Ltd. Accept service 162264149.40 - Chongqing Hanon Jianshe Automotive Thermal Systems Co. Ltd. Purchase of spare parts 151002052.30 192644714.03 Purchase of spare parts and accept Jiangling Holding Co. Ltd. 138548818.43 - service Chongqing Lingchuan Auto Parts Manufacturing Technology Co. Ltd. Purchase of spare parts 136745996.51 116001208.39 Purchase of spare parts and accept Chengdu Wanyou Filter Co. Ltd. 131651417.70 130985512.13 service Yunnan Xiyi Industries Co. Ltd. Purchase of spare parts 107396789.80 104765620.44 Purchase of spare parts and accept Beijing Wutong Chelian Technology Co. Ltd. 104475718.53 72575303.13 service Hubei Xiaogan Huazhong Automobile Light Co. Ltd. Purchase of spare parts 100374013.64 108537666.51 Chongqing Shangfang Automobile Fittings Co. Ltd. Purchase of spare parts 84981815.82 94792739.82 Purchase of spare parts and accept Tenneco Lingchuan (Chongqing) Exhaust System Company Ltd. 67353980.86 56309042.36 service Purchase of spare parts and accept Chongqing Wanyou Economic Development Co. Ltd. 66255194.45 603419863.12 service Chongqing Jianshe Automobile Air-conditioner Co. Ltd. Purchase of spare parts 60528242.94 159688393.32 Subtotal of this page 2807595178.28 3011508075.29 215Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 5. Major transactions between the Group and its related parties (continued) (1) Transactions of goods and services (continued) Purchases of goods and services from related parties (continued) Related parties Nature of the transaction 2022 2021 Chengdu Lingchuan Vehicle Oil Tank Co. Ltd. Purchase of spare parts 33992791.02 38128016.68 Chongqing Qingshan Transmission Sales Co. Ltd. Purchase of spare parts 32926122.52 23973681.31 Chongqing Yihong Defense Technology Co. Ltd Purchase of spare parts 36665517.10 14709194.40 Chengdu Zhongzi Guangming Catalytic Technology Co. Ltd Purchase of spare parts 29580684.02 - Longchang Shanchuan Precision Welded Tube Co. Ltd. Purchase of spare parts 27909131.44 28967949.24 Chongqing Construction Tongda Industrial Co. Ltd. Purchase of spare parts 25814511.10 37055895.63 Yunnan Wanyou Auto Sales and Service Co. Ltd. Accept service 25188983.36 22766515.25 Guizhou Wanyou Auto Sales and Service Co. Ltd. Accept service 13511730.91 14259779.04 Chongqing Changan Industries Group Co. Ltd. Accept service 12292136.25 17861163.78 Chengdu Wanyou Xiangyu Auto Sales and Service Co. Ltd. Accept service 12062273.95 10395446.00 Chengdu Ningjiang Zhaohe Automobile Components Co. Ltd. Purchase of spare parts 10745694.02 60296426.94 Chengdu Wanyou Auto Trade Service Co. Ltd. Accept service 9348028.62 8507457.55 Jiangsu Wanyou Automobile Sales Service Co. Ltd. Accept service 7102848.68 1986071.15 Anhui Wanyou Automobile Sales Service Co. Ltd. Accept service 5293300.68 2404928.50 Chongqing Changan Property Management Co. Ltd. Accept service 4134339.52 4176911.94 Chongqing Wanyou Ducheng Auto Sales Service Co. Ltd. Accept service 4101094.51 3338044.36 Chongqing Dajiang Jiexin Forging Co. Ltd. Purchase of spare parts 3078583.33 5121697.47 Chongqing Changan Intelligent Industrial Technology Service Co. Ltd. Accept service 2946005.80 - Chengdu Jialing Huaxi Optical & Precision Machinery Co. Ltd. Purchase of spare parts 2786069.10 10043682.64 Subtotal of this page 299479845.93 303992861.88 216Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 5. Major transactions between the Group and its related parties (continued) (1) Transactions of goods and services (continued) Purchases of goods and services from related parties (continued) Related parties Nature of the transaction 2022 2021 Purchase of spare parts and accept Hunan Tyen Machinery Co. Ltd. 2092525.14 70511666.83 service Southwest Ordnance Industry Chongqing Environmental Protection Accept service 2049165.81 - Research Institute Co. Ltd Ya'an Wanyou Auto Sales and Service Co. Ltd. Accept service 1946181.65 1736024.66 Chongqing Wanyou Xingjian Auto Sales & Service Co. Ltd. Accept service 1423274.77 1919504.03 China Changan Automobile Group Tianjin Sales Co. Ltd. Accept service 1371694.94 1808381.51 Chongqing Jianshe Industry (Group) Co. Ltd. Purchase of spare parts 1197461.49 1732643.94 Chengdu Wanyou Auto Sales and Service co.Ltd. Accept service 678453.32 187650.50 Luzhou Wanyou Automobile Service Co. Ltd. Accept service 509671.25 669657.17 Purchase of spare parts and accept Beijing Zhongbing Insurance Brokerage Co. Ltd. 226434.19 340815.00 service Chongqing Dajiang Yuqiang Plastic Co. Ltd. Purchase of spare parts 459367.27 93797140.57 Panzhihua Wanyou Auto Sales & Service Co. Ltd. Accept service 451213.56 514551.95 Purchase of spare parts and accept Nanjing LingHang Technology Co. Ltd. 348114.07 378892.59 service Zhongqi Chuangzhi Technology Co. Ltd. Accept service 320000.00 - Chongqing Pingshan Tk Carburetor Co. Ltd. Purchase of spare parts 170426.18 256266.00 Chongqing Wanyou Zhicheng Automobile Sales and Service Co. Ltd Purchase of spare parts 127433.63 - Yunnan Wanxing Automobile Sales and Service Co. Ltd Accept service 76719.72 981350.81 Chengdu Wanyou Trading Co. Ltd. Accept service 55017.09 35404.55 Beijing Beiji Mechanical and Electrical Industry Co. Ltd. Purchase of spare parts 38462.43 3933.64 Subtotal of this page 13541616.51 174873883.75 217Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 5. Major transactions between the Group and its related parties (continued) (1) Transactions of goods and services (continued) Purchases of goods and services from related parties (continued) Related parties Nature of the transaction 2022 2021 Changan Ford Automobile Co. Ltd. Purchase of spare parts 35475.70 329133.98 China South Industries Financial Leasing Co. Ltd. Accept service 22339.62 - Chongqing Wanyou Zunda Automobile Sales & Service Co. Ltd. Purchase of spare parts 12900.95 - Purchase of spare parts and accept Changan Reis (Chongqing) Robotic Intelligent Equipment Co. Ltd. - 44892792.39 service Hangzhou Chelizi Intelligent Technology Co. Ltd. Purchase of spare parts - 2148762.81 Chongqing Changan Construction Co. Ltd. Accept service - 564840.03 China Changan Automobile Group Co. Ltd. Accept service - 120000.00 Bazhong Wanyou Auto Sales & Service Co. Ltd. Accept service - 64894.12 Chongqing Chang'an Minsheng Boyu Logistics Co. Ltd. Accept service - 47627.52 China South Industries Group Information Center Co. Ltd. Accept service - 27169.81 Chongqing Changfeng Jiquan Machinery Co. Ltd. Purchase of spare parts - 7254.24 Nanjing CMSC Logistics Co. Ltd. Accept service - 2752.29 Subtotal of this page 70716.27 48205227.19 Total 25192959024.31 20294531010.70 The price of the Group’s purchase from related parties is based on contracts agreed by both parties. 218Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 5. Major transactions between the Group and its related parties (continued) (1) Transactions of goods and services (continued) Sales of goods and services to related parties Related parties Nature of the transaction 2022 2021 Chongqing Changan New Energy Vehicles Technology Co. Ltd. Sales of vehicle parts and services 2609084124.78 2087692782.62 Chongqing Wanyou Economic Development Co. Ltd. Sales of vehicle parts and services 1684301990.87 1720993540.69 Chongqing Wanyou Zunda Automobile Sales & Service Co. Ltd. Selling parts and services 1476308931.64 436822730.06 Chengdu Wanyou Xiangyu Auto Sales and Service Co. Ltd. Sales of vehicle parts and services 1284359479.27 1257537353.64 Yunnan Wanyou Auto Sales and Service Co. Ltd. Sales of vehicle parts and services 1142270993.20 1046987731.08 Pakistan Master Automobile Co. Ltd. Sales of vehicles and parts 924463919.88 825606129.36 Guizhou Wanyou Auto Sales and Service Co. Ltd. Sales of vehicle parts and services 884848504.37 929945622.49 Avatr Technology (Chongqing) Co. Ltd. Sales of vehicle parts and services 714145977.09 - Wanyou Automobile Investment Co. Ltd. Selling vehicles and services 598010950.82 535094553.91 Chengdu Wanyou Auto Trade Service Co. Ltd. Sales of vehicle parts and services 549991470.85 513214521.29 Changan Automobile Finacing Co. Ltd. Provide labor services 490826007.07 399039103.55 Jiangsu Wanyou Automobile Sales Service Co. Ltd. Sales of vehicle parts and services 470683276.14 200741980.03 Anhui Wanyou Automobile Sales Service Co. Ltd. Sales of vehicle parts and services 260352341.97 199372254.88 China Changan Automobile Group Tianjin Sales Co. Ltd. Sales of vehicle parts and services 247493153.78 227233799.93 Changan Ford Automobile Co. Ltd. Selling parts and services 179318692.12 10926158.29 Chongqing Tsingshan Industrial Co. Ltd. Selling parts and services 158523290.48 82201791.51 Chongqing Changan Kuayue Automobile Co. Ltd. Selling parts and services 77335639.06 71993694.98 Changan Mazda Automobile Co. Ltd. Selling goods and services 64329600.00 - China South Industries Group Financial Leasing Co. Ltd. Provide labor services 48064780.21 7132075.48 Chongqing Dajiang Guoli Precision Machinery Manufacturing Co. Ltd. Selling parts 37118575.61 10746.64 Harbin Dongan Automotive Engine Manufacturing Co. Ltd. Selling parts 28271075.57 62194464.21 Subtotal of this page 13930102774.78 10614741034.64 219Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 5. Major transactions between the Group and its related parties (continued) (1) Transactions of goods and services (continued) Sales of goods and services to related parties (continued) Related parties Nature of the transaction 2022 2021 Chongqing Anfu Automobile Co. Ltd. Sales of vehicles and parts 27875221.32 14756637.21 Yunnan Wanxing Automobile Sales and Service Co. Ltd Sales of vehicles and parts 18948851.57 93848306.63 Tenneco Lingchuan (Chongqing) Exhaust System Company Ltd. Selling parts 4244013.23 - Ya'an Wanyou Auto Sales and Service Co. Ltd. Sales of vehicle parts and services 3074292.53 1555063.32 Chongqing Wanyou Ducheng Auto Sales Service Co. Ltd. Sales of vehicle parts and services 2714289.11 2356554.96 China Changan Automobile Group Hefei Investment Co. Ltd. Selling vehicles 2169330.09 40568514.45 Chongqing Changan Minsheng Logistics Co. Ltd. Selling parts and services 2148551.67 3311934.58 Nanjing LingHang Technology Co. Ltd. Provide labor services 1871703.43 - Chongqing Lingchuan Auto Parts Manufacturing Technology Co. Ltd. Selling parts 1866175.08 12045145.12 China South Industry Group Finance Co. Ltd. Provide labor services 1852079.79 365474.29 Chongqing Wanyou Xingjian Auto Sales & Service Co. Ltd. Selling parts and services 1575307.62 1356654.72 Chengdu Lingchuan Vehicle Oil Tank Co. Ltd. Selling parts 1480056.13 2246031.95 Yunnan Xiyi Industries Co. Ltd. Selling parts 1365240.00 131376.00 Chengdu Wanyou Auto Sales and Service co.Ltd. Sales of vehicle parts and services 934370.23 219077.77 Luzhou Wanyou Automobile Service Co. Ltd. Selling parts and services 820143.92 1026650.15 Chongqing Dajiang Tongyang Plastics Co. Ltd. Selling parts 750186.19 1536134.53 Panzhihua Wanyou Auto Sales & Service Co. Ltd. Selling parts and services 712145.73 479039.76 Jiangling Holding Co. Ltd. Selling parts and services 397278.07 - Subtotal of this page 74799235.71 175802595.44 220Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 5. Major transactions between the Group and its related parties (continued) (1) Transactions of goods and services (continued) Sales of goods and services to related parties (continued) Related parties Nature of the transaction 2022 2021 Chongqing Changan Kuayue Automobile Sales Co. Ltd. Selling parts 281930.93 279576.78 Chongqing Jianshe Industry (Group) Co. Ltd. Selling parts 253525.27 - Lear Changan (Chongqing) Automotive System Co. Ltd. Selling parts and services 147535.15 14716.98 Chongqing Dajiang Yuqiang Plastic Co. Ltd. Selling parts 131400.00 - China South Industries Group Commercial Factoring Co. Ltd. Provide labor services 106858.13 113315.44 China Changan Automobile Group Co. Ltd. Provide labor services 84905.66 - Hainan Anxinxing Information Technology Co. Ltd. Provide labor services 28301.89 180405.38 Chengdu Wanyou Trading Co. Ltd. Selling parts and services 25171.68 - Sichuan Ningjiang Shanchuan Machinery Co Ltd. Provide labor services 13329.40 349056.60 Chongqing Jianshe Automobile Air-conditioner Co. Ltd. Selling parts 11946.90 - Chongqing Wutong Chelian Technology Co. Ltd. Provide labor services 11320.75 - South Inter Air-conditioner Co.Ltd. Provide labor services 2943.40 - Harbin Dongan Auto Engine Co. Ltd. Provide labor services 1173.00 54540.16 Chongqing Chang'an Minsheng Boyu Logistics Co. Ltd. Selling vehicles - 103326580.61 China South Industries Group Information Center Co. Ltd. Provide labor services - 690566.04 Changan Mazda Engine Co. Ltd. Selling parts - 138073.58 Chongqing Nexteer Steering System Co.Ltd. Selling parts - 104655.66 Chengdu Huachuan Electric Equipment Co. Ltd. Selling parts and services - 103773.58 United Automotive Electronis Systems (Chongqing) Co. Ltd. Selling parts - 56120.75 Southern Fojiya Auto Parts Co. Ltd. Provide labor services - 1490.57 Subtotal of this page 1100342.16 105412872.13 Total 14006002352.65 10895956502.21 The price of the Group’s sales to related parties is based on contracts agreed by all parties. 221Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 5. Major transactions between the Group and its related parties (continued) (2) Other major related-party transactions The price of the Group’s other major related-party transactions is based on contracts agreed by all parties.Expenses of integrated service charges Related parties 2022 2021 Chongqing Changan Industries Group Co. Ltd. 72388391.31 87217070.27 Purchase of project materials Related parties 2022 2021 Changan Reis (Chongqing) Robotic Intelligent Equipment Co. Ltd. 14202332.81 607600.00 Chongqing Changan Minsheng Logistics Co. Ltd. 13862.82 - Sichuan Jian'an Industrial Co.Ltd. 44.14 - Chongqing Changan Construction Co. Ltd. - 26233377.55 Total 14216239.77 26840977.55 Staff expenses for technical supporting Related parties 2022 2021 Chongqing Changan New Energy Vehicles Technology Co. Ltd. 87739303.52 17151364.69 Changan Ford Automobile Co. Ltd. 26618313.54 33193267.38 Changan Mazda Automobile Co. Ltd. 20766828.90 22076355.37 Changan Mazda Engine Co. Ltd. 13623103.29 14413961.51 Chongqing Changan Kuayue Automobile Co. Ltd. 2724505.28 3113694.01 Jiangling Holding Co. Ltd. 1465987.40 3663424.01 Jiangling Motors Co. Ltd 1158831.59 - Hainan Anxinxing Information Technology Co. Ltd. 634354.87 - Chongqing Changan Minsheng Logistics Co. Ltd. - 654146.65 Chongqing Shangfang Automobile Fittings Co. Ltd. - 53900.00 Total 154731228.39 94320113.62 222Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 5. Major transactions between the Group and its related parties (continued) (2) Other major related-party transactions (continued) Deferred interest income from funds Related parties 2022 2021 Yunnan Wanyou Auto Sales and Service Co. Ltd. 297408.89 228308.44 Chengdu Wanyou Auto Trade Service Co. Ltd. 109002.02 127015.84 Chongqing Wanyou Economic Development Co. Ltd. 66581.59 43143.18 Anhui Wanyou Automobile Sales Service Co. Ltd. 42256.63 2723.01 Jiangsu Wanyou Automobile Sales Service Co. Ltd. 32918.60 8148.67 China Changan Automobile Group Tianjin Sales Co. Ltd. 21429.12 5878.76 Wanyou Automobile Investment Co. Ltd. 19690.27 46188.50 Chengdu Wanyou Xiangyu Auto Sales and Service Co. Ltd. 9988.50 50616.82 Chongqing Changan Minsheng Logistics Co. Ltd. 4584.91 - Guizhou Wanyou Auto Sales and Service Co. Ltd. 3686.97 75045.17 Yunnan Wanxing Automobile Sales and Service Co. Ltd - 28390.27 Total 607547.50 615458.66 (3) Lease between related parties As lessor Related parties Type of 2022 2021 leased assets Nanjing LingHang Technology Co. Ltd. Vehicle 89060494.43 125060344.01 Chongqing Changan New Energy Vehicles Building and Technology Co. Ltd. equipment 129219487.60 20690813.54 Ald Fortune Auto Leasing & Renting (Shanghai) Co.Ltd. Vehicle 28781100.74 70778756.80 Chongqing Changan Industries Group Co. Ltd. Building 6667632.38 6650384.59 Chongqing Changan Minsheng Logistics Co. Ltd. Building 703167.61 675912.67 Chongqing Wanyou Economic Development Co. Ltd. Building 642201.84 645346.00 South Inter Air-conditioner Co.Ltd. Vehicle 67752.21 67752.21 Nanjing CMSC Logistics Co. Ltd. Vehicle - 172460.17 Zhongqi Chuangzhi Technology Co. Ltd. Vehicle - 116037.74 Ya'an Changan Affordable Housing Construction Co.Ltd. Vehicle - 36106.19 Chongqing Dajiang Jiexin Forging Co. Ltd. Vehicle - 38123.89 Total 255141836.81 224932037.81 223Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 5. Major transactions between the Group and its related parties (continued) (3) Lease between related parties (continued) As lessee Related parties Type of leased assets 2022 2021 Chongqing Changan Minsheng Logistics Co. Ltd Warehouse 21845685.75 15940585.06 Note: The lease with Chongqing Changan Minsheng Logistics Co. Ltd. is a short-term lease and the right-of-use asset is not recognized. (4) Deposits and loan interest from related parties Interest income Related parties Type of leased assets 2022 2021 China South Industry Group Finance Co. Deposit interest Ltd. income 323932186.89 192425074.21 Deposit Interest Changan Automobile Finacing Co. Ltd. income 220175000.00 249750000.00 Entrusted loan Jiangling Holding Co. Ltd. interest income - 6959316.00 Total 544107186.89 449134390.21 Interest expense Related parties Type of transaction 2022 2021 China South Industry Group Finance Co. Ltd. Loan interest expense 2546530.48 10158888.89 (5) Other related party transactions Related parties 2022 2021 Compensation of key management personal 29192727.00 30376486.00 Stock-based compensation of key management personal 13446227.88 10771483.50 Total 42638954.88 41147969.50 224Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 6. Amounts due from/to related parties (1) Notes receivable Related parties 2022 2021 Chongqing Changan New Energy Vehicles Technology Co. Ltd. 3623354650.53 1707657373.40 Wanyou Automobile Investment Co. Ltd. 3047690000.00 2175240000.00 Avatr Technology (Chongqing) Co. Ltd. 121822864.29 - Yunnan Wanyou Auto Sales and Service Co. Ltd. 43000000.00 47000000.00 Chongqing Tsingshan Industrial Co. Ltd. 40463588.91 7995373.20 Chengdu Wanyou Auto Trade Service Co. Ltd. 22500000.00 24800000.00 Chongqing Wanyou Economic Development Co. Ltd. 20250000.00 25500000.00 Guizhou Wanyou Auto Sales and Service Co. Ltd. 7300000.00 5500000.00 Harbin Dongan Automotive Engine Manufacturing Co.Ltd. 3029467.77 9132765.60 Chongqing Changan Kuayue Automobile Co. Ltd. - 13841516.24 Chongqing Changan Minsheng Logistics Co. Ltd. - 1895178.03 Chongqing Changan Kuayue Automobile Sales Co. Ltd. - 1450000.00 Total 6929410571.50 4020012206.47 225Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 6. Amounts due from/to related parties (continued) (2) Accounts receivable Related parties 2022 2021 Chongqing Changan New Energy Vehicles Technology Co.Ltd. 1011838777.69 664390126.60 Avatr Technology (Chongqing) Co. Ltd. 320592883.29 - Changan Ford Automobile Co. Ltd. 195582372.52 27571894.33 Jiangling Holding Co. Ltd. 121166512.75 43263418.79 Changan Mazda Automobile Co. Ltd. 72378357.38 10443141.10 Changan Automobile Finacing Co. Ltd. 68199053.80 27000000.00 Chongqing Changan Kuayue Automobile Co. Ltd. 39592219.39 31600512.92 Beijing Fang Anxin Yue Rental Auto Co.Ltd. 38600000.00 38600000.00 Pakistan Master Automobile Co. Ltd. 37958837.2570424616.57 Chongqing Tsingshan Industrial Co. Ltd. 29579405.37 15547355.69 China South Industries Group Financial Leasing Co. Ltd. 9734968.89 - Ald Fortune Auto Leasing & Renting (Shanghai) Co. Ltd. 5181800.00- Nanjing LingHang Technology Co. Ltd. 4209516.65 16622454.93 Chongqing Changan Industries Group Co. Ltd. 3626628.57 192632.17 Changan Mazda Engine Co. Ltd. 3494661.85 - Jiangling Motors Co. Ltd 1176831.13 - Chongqing Changan Minsheng Logistics Co. Ltd. 688099.86 32259206.05 Harbin Dongan Automotive Engine Manufacturing Co.Ltd. 147532.81 21179345.59 Chengdu Wanyou Xiangyu Auto Sales and Service Co. Ltd. 127548.00 - Guizhou Wanyou Auto Sales and Service Co. Ltd. 63900.00 - Chongqing Changan Kuayue Automobile Sales Co. Ltd. 31861.79128646.00 China South Industries Group Commercial Factoring Co.Ltd. 1841.34 1841.34 Chongqing Changan Intelligent Industrial Technology Service Co. Ltd. 0.15 - Tenneco Lingchuan (Chongqing) Exhaust System Company Ltd. 0.03 0.03 Total 1963973610.51 999225192.11 226Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 6. Amounts due from/to related parties (continued) (3) Prepayments Related parties 2022 2021 Beijing Wutong Chelian Technology Co. Ltd. 12438660.30 21982556.75 Chongqing Changan New Energy Vehicles Technology Co. Ltd. 10397480.50 5660917.50 Chongqing Tsingshan Industrial Co. Ltd. - 180000000.00 Chongqing Nexteer Steering System Co.Ltd. - 50000000.00 Total 22836140.80 257643474.25 (4) Other receivables Related parties 2022 2021 Chongqing Changan Industries Group Co. Ltd. 1157446.69 1157446.69 China South Industry Group Finance Co. Ltd. 859049.92 - Chongqing Changan Minsheng Logistics Co. Ltd. 436.57 596131.62 Chongqing Changxin Zhiqi Private Equity Investment Fund Partnership (Limited Partnership) - 26670000.00 Chongqing Changan New Energy Vehicles Technology Co. Ltd. - 25935000.00 Hafei Motor Co. Ltd. - 1500000.00 Nanjing LingHang Technology Co. Ltd. - 1027352.32 Total 2016933.18 56885930.63 227Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 6. Amounts due from/to related parties (continued) (5) Notes payable Related parties 2022 2021 Chongqing Tsingshan Industrial Co. Ltd. 1078658254.05 997630000.00 Chongqing Nexteer Steering System Co.Ltd. 327738252.79 345500000.00 Chongqing Changan Minsheng Logistics Co. Ltd. 300858223.58 293970489.20 Chongqing Changan New Energy Vehicles Technology Co. Ltd. 293766946.00 100200000.00 Harbin Dongan Automotive Engine Manufacturing Co. Ltd. 197280000.00 449050000.00 Dajiang Yapp Automotive Systems Co. Ltd. 175450000.00 172180000.00 Chongqing Dajiang Tongyang Plastics Co. Ltd. 145840000.00 72710000.00 Hubei Huazhong Marelli Automobile Lighting Co. Ltd. 139690000.00 115860000.00 South Inter Air-conditioner Co.Ltd. 130650474.98 76300000.00 South Tianhe Chassis System Co. Ltd. 118961825.13 33896189.65 Gkn Huayu Driveline Systems(chongqing) Co. Ltd. 98250000.00 76420000.00 Chongqing Hanon Jianshe Automotive Thermal Systems Co. Ltd. 82600000.00 83160000.00 Chongqing Lingchuan Auto Parts Manufacturing Technology Co. Ltd. 80530000.00 50210000.00 Sichuan Ningjiang Shanchuan Machinery Co Ltd. 60759442.02 71204039.75 Jiangling Holding Co. Ltd. 59248188.59 - Harbin Dongan Auto Engine Co. Ltd. 59090000.00 144790000.00 Southern Fojiya Auto Parts Co. Ltd. 36370000.00 27690000.00 Chengdu Wanyou Filter Co. Ltd. 34373849.84 34230000.00 Chongqing Shangfang Automobile Fittings Co. Ltd. 33869017.86 40747850.00 Tenneco Lingchuan (Chongqing) Exhaust System Company Ltd. 32530000.00 9110000.00 Chongqing Jianshe Automobile Air-conditioner Co. Ltd. 20050000.00 57320000.00 Chongqing Yihong Defense Technology Co. Ltd 19560000.00 7990000.00 Hubei Xiaogan Huazhong Automobile Light Co. Ltd. 15650000.00 15230000.00 Chongqing Construction Tongda Industrial Co. Ltd. 10640000.00 12789350.84 Chongqing Dajiang Guoli Precision Machinery Manufacturing Co. Ltd. 7765999.95 - Longchang Shanchuan Precision Welded Tube Co. Ltd. 6140145.72 700000.00 Chongqing Changrong Machinery Co. Ltd. 1314548.20 - Chongqing Dajiang Jiexin Forging Co. Ltd. 1090000.00 2230000.00 Chengdu Jialing Huaxi Optical & Precision Machinery Co. Ltd. 950000.00 4420000.00 Hunan Tyen Machinery Co. Ltd. 630000.00 45800000.00 Chengdu Zhongzi Guangming Catalytic Technology Co. Ltd 560000.00 - Chengdu Ningjiang Zhaohe Automobile Components Co. Ltd. - 29530000.00 Changan Reis (Chongqing) Robotic Intelligent Equipment Co. Ltd. - 16298837.60 Chongqing Changan Construction Co. Ltd. - 2417746.00 Total 3570865168.71 3389584503.04 228Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 6. Amounts due from/to related parties (continued) (6) Accounts payable Related parties 2022 2021 Jiangling Holding Co. Ltd. 1116408615.48 37578608.85 Chongqing Changan New Energy Vehicles Technology Co. Ltd. 822638571.39 45785722.56 Chongqing Nexteer Steering System Co.Ltd. 278876988.05 303819542.94 Hubei Huazhong Marelli Automobile Lighting Co. Ltd. 236096916.60 276099169.78 Chongqing Tsingshan Industrial Co. Ltd. 153454423.03 289136235.05 Dajiang Yapp Automotive Systems Co. Ltd. 152806662.74 130308165.60 South Tianhe Chassis System Co. Ltd. 142620012.97 218042109.95 Lear Changan (Chongqing) Automotive System Co.Ltd. 109342564.03 59478481.96 Harbin Dongan Auto Engine Co. Ltd. 103616123.17 155019007.24 Harbin Dongan Automotive Engine Manufacturing Co.Ltd. 99563867.81 79164395.58 South Inter Air-conditioner Co.Ltd. 87495633.58 156165656.54 Chongqing Dajiang Tongyang Plastics Co. Ltd. 86558622.08 122247111.17 Southern Fojiya Auto Parts Co. Ltd. 79576674.87 111176628.27 United Automotive Electronis Systems (Chongqing) Co. Ltd. 72864235.98 43729758.05 Gkn Huayu Driveline Systems(chongqing) Co. Ltd. 49148122.03 67131433.77 Chengdu Huachuan Electric Equipment Co. Ltd. 41958250.19 42505846.09 Sichuan Jian'an Industrial Co.Ltd. 40868455.07 114453923.31 Chengdu Zhongzi Guangming Catalytic Technology Co. Ltd 32759347.97 83175.03 Chongqing Lingchuan Auto Parts Manufacturing Technology Co. Ltd. 25869763.88 23129987.81 Hubei Xiaogan Huazhong Automobile Light Co. Ltd. 19359970.66 22108475.58 Chongqing Changrong Machinery Co. Ltd. 18773538.36 48459589.80 Chengdu Wanyou Filter Co. Ltd. 14115700.51 14085492.47 Chongqing Shangfang Automobile Fittings Co. Ltd. 13575599.30 26347971.01 Chongqing Changan Minsheng Logistics Co. Ltd. 12696301.88 26921418.99 Chongqing Construction Tongda Industrial Co. Ltd. 11268342.31 16219154.70 Sichuan Ningjiang Shanchuan Machinery Co Ltd. 11108409.24 24528900.28 Chongqing Jianshe Automobile Air-conditioner Co. Ltd. 10360465.69 22265092.41 Chongqing Qingshan Transmission Sales Co. Ltd. 10199151.11 10260951.97 Changan Reis (Chongqing) Robotic Intelligent Equipment Co. Ltd. 8537490.14 129036.87 Chengdu Lingchuan Vehicle Oil Tank Co. Ltd. 8056699.53 16297923.33 Chongqing Dajiang Guoli Precision Machinery Manufacturing Co. Ltd. 6417935.77 14889297.76 Tenneco Lingchuan (Chongqing) Exhaust System Company Ltd. 5380229.34 8304368.73 Subtotal of this page 3882373684.76 2525872633.45 229Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 6. Amounts due from/to related parties (continued) (6) Accounts payable (continued) Related parties 2022 2021 Chongqing Yihong Defense Technology Co. Ltd 4247025.85 1278419.64 Beijing Wutong Chelian Technology Co. Ltd. 4301349.18 5798358.99 Yunnan Xiyi Industries Co. Ltd. 4210156.64 1815316.79 Chongqing Hanon Jianshe Automotive Thermal Systems Co.Ltd. 2388277.76 22651086.10 Changan Ford Automobile Co. Ltd. 1878695.33 1943909.28 Longchang Shanchuan Precision Welded Tube Co. Ltd. 1759775.48 2359553.08 Chengdu Ningjiang Zhaohe Automobile Components Co.Ltd. 1358424.58 8406255.55 Southwest Ordnance Industry Chongqing Environmental Protection Research Institute Co. Ltd 963651.26 - Chongqing Wanyou Economic Development Co. Ltd. 757763.87 3256626.28 Chengdu Jialing Huaxi Optical & Precision Machinery Co.Ltd. 559576.76 1137544.54 Chongqing Dajiang Yuqiang Plastic Co. Ltd. 496894.20 4627147.80 Chongqing Dajiang Jiexin Forging Co. Ltd. 312203.77 103404.61 Chongqing Changan Industries Group Co. Ltd. 236355.17 601702.05 Chengdu Lingchuan Special Industry Co. Ltd. 220175.48 325142.83 Chongqing Automobile Air-conditioner Co. Ltd. 205041.51 205041.51 Hunan Tyen Machinery Co. Ltd. 143359.78 2083314.54 Chongqing Jialing Yimin Special Equipment Co. Ltd. 104496.50 104496.50 Chongqing Dajiang Xinda Vehicles Shares Co. Ltd. 56251.08 56251.08 Chongqing Jianshe Mechanical & Electrical Equipment Co.Ltd. 47265.91 47265.91 Chongqing Xiyi Automobile Connecting Rod Co. Ltd. 38422.14 38422.14 Chongqing Wanyou Xingjian Auto Sales & Service Co. Ltd. 20842.80 20842.80 Hangzhou Chelizi Intelligent Technology Co. Ltd. 12350.00 12350.00 Beijing Beiji Mechanical and Electrical Industry Co. Ltd. 3165.30 29268.25 Chongqing Changan Kuayue Automobile Co. Ltd. 1382.56 5271250.56 Chongqing Changfeng Jiquan Machinery Co. Ltd. 1340.91 1850577.35 Hafei Motor Co. Ltd. 344.04 949114.25 Chengdu Wanyou Auto Trade Service Co. Ltd. 250.00 - China Changan Automobile Group Co. Ltd. - 14756.94 Chongqing Jianshe Industry (Group) Co. Ltd. - 857195.55 Chongqing Pingshan Tk Carburetor Co. Ltd. - 70083.18 Chengdu Wanyou Xiangyu Auto Sales and Service Co. Ltd. - 1544.70 Subtotal of this page 24324837.86 65916242.80 Total 3906698522.62 2591788876.25 230Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 6. Amounts due from/to related parties (continued) (7) Contract liabilities Related parties 2022 2021 Chongqing Wanyou Economic Development Co. Ltd. 124667991.83 269281235.61 Guizhou Wanyou Auto Sales and Service Co. Ltd. 96702773.24 133567022.54 Chongqing Wanyou Zunda Automobile Sales & Service Co. Ltd. 74694999.66 22362432.39 Chengdu Wanyou Xiangyu Auto Sales and Service Co. Ltd. 64279954.50 118480778.11 Jiangsu Wanyou Automobile Sales Service Co. Ltd. 58420002.39 41137071.23 Yunnan Wanyou Auto Sales and Service Co. Ltd. 49769852.59 101043742.82 Wanyou Automobile Investment Co. Ltd. 47689212.74 68334467.34 China Changan Automobile Group Tianjin Sales Co. Ltd. 33057138.53 37209408.83 Chengdu Wanyou Auto Trade Service Co. Ltd. 18393074.44 51006262.19 Anhui Wanyou Automobile Sales Service Co. Ltd. 12540522.24 36775197.75 Jiangling Holding Co. Ltd. 6854200.00 6854200.00 Avatr Technology (Chongqing) Co. Ltd. 5832549.46 - Pakistan Master Automobile Co. Ltd. 5213676.57 - Changan Automobile Finacing Co. Ltd. 685200.00 - Changan Ford Automobile Co. Ltd. 493954.43 - Hafei Motor Co. Ltd. 471942.49 670500.00 Chongqing Changan Minsheng Logistics Co. Ltd. 416441.17 - Chongqing Wanyou Ducheng Auto Sales Service Co. Ltd. 373179.91 21566.76 Chongqing Wanyou Xingjian Auto Sales & Service Co. Ltd. 155719.35 68346.03 Chongqing Anfu Automobile Co. Ltd. 149000.00 73268.00 Chengdu Wanyou Auto Sales and Service co.Ltd. 101869.64 30005.78 Luzhou Wanyou Automobile Service Co. Ltd. 91342.25 50528.84 Ya'an Wanyou Auto Sales and Service Co. Ltd. 75083.25 23611.57 Bazhong Wanyou Auto Sales & Service Co. Ltd. 50426.48 50426.48 Chengdu Wanyou Trading Co. Ltd. 18900.00 - Panzhihua Wanyou Auto Sales & Service Co. Ltd. 16305.41 17855.01 Chongqing Shangfang Automobile Fittings Co. Ltd. 12979.98 12979.98 China Changan Automobile Group Hefei Investment Co. Ltd. 10273.00 10273.00 Yunnan Wanxing Automobile Sales and Service Co. Ltd 6816.00 15033974.67 Dali Wanfu Automobile Sales and Service Co. Ltd 3486.06 - Guangxi Wanyou Auto Sales and Service Co. Ltd. 302.40 302.40 Changan Mazda Engine Co. Ltd. - 3060368.00 Chongqing Chang'an Minsheng Boyu Logistics Co. Ltd. - 2646426.62 Ya'an Changan Affordable Housing Construction Co. Ltd. - 10000.00 Chongqing Hanon Jianshe Automotive Thermal Systems Co. Ltd. - 147080.20 Total 601249170.01 907979332.15 231Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 6. Amounts due from/to related parties (continued) (8) Other payables Related parties 2022 2021 Chongqing Changan Minsheng Logistics Co. Ltd. 392075910.69 123243509.52 Chongqing Changan New Energy Vehicles Technology Co. Ltd. 113039584.99 28204667.10 Chongqing Changan Construction Co. Ltd. 26391448.08 26391448.08 Yunnan Wanyou Auto Sales and Service Co. Ltd. 10068122.20 3756167.26 Chongqing Tsingshan Industrial Co. Ltd. 7868918.85 565792.16 Chengdu Wanyou Xiangyu Auto Sales and Service Co. Ltd. 7732620.00 5204000.00 Chongqing Wanyou Economic Development Co. Ltd. 7660147.80 245798.56 Jiangsu Wanyou Automobile Sales Service Co. Ltd. 4970000.00 504400.00 Chongqing Changan Intelligent Industrial Technology Service 4404413.091507567.09 Co. Ltd.Guizhou Wanyou Auto Sales and Service Co. Ltd. 4007517.20 828912.03 China Changan Automobile Group Tianjin Sales Co. Ltd. 3729000.00 - Chengdu Wanyou Auto Trade Service Co. Ltd. 3607415.80 1296988.78 United Automotive Electronis Systems (Chongqing) Co. Ltd. 3439700.00 263423.01 Chongqing Changan Industries Group Co. Ltd. 2960859.38 2010787.85 Sichuan Jian'an Industrial Co.Ltd. 2101400.49 709839.37 Ya'an Wanyou Auto Sales and Service Co. Ltd. 2063900.00 733079.80 Chongqing Changan Property Management Co. Ltd. 1935184.57 1587169.00 South Inter Air-conditioner Co.Ltd. 1567432.39 425490.20 Anhui Wanyou Automobile Sales Service Co. Ltd. 1475600.00 - Chongqing Dajiang Tongyang Plastics Co. Ltd. 1423800.00 1067850.00 Chengdu Wanyou Filter Co. Ltd. 1266573.71 143553.10 Hunan Tyen Machinery Co. Ltd. 1235044.80 951324.40 Chongqing Shangfang Automobile Fittings Co. Ltd. 1113793.54 3390.00 Chongqing Wanyou Ducheng Auto Sales Service Co. Ltd. 1096014.24 42215.90 Changan Reis (Chongqing) Robotic Intelligent Equipment Co. 917118.5218027403.31 Ltd.Chengdu Wanyou Auto Sales and Service co.Ltd. 790000.00 350000.00 Chongqing Wanyou Xingjian Auto Sales & Service Co. Ltd. 400000.00 - South Tianhe Chassis System Co. Ltd. 293868.55 606242.21 Chongqing Lingchuan Auto Parts Manufacturing Technology 219898.32332961.91 Co. Ltd.Harbin Dongan Automotive Engine Manufacturing Co. Ltd. 203155.92 1258466.14 Chongqing Anfu Automobile Co. Ltd. 200000.00 200000.00 Chengdu Huachuan Electric Equipment Co. Ltd. 173206.40 356673.20 Chongqing Dajiang Xinda Vehicles Shares Co. Ltd. 150000.00 50000.00 Subtotal 610581649.53 220869119.98 232Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 6. Amounts due from/to related parties (continued) (8) Other payables (continued) Related parties 2022 2021 Yunnan Xiyi Industries Co. Ltd. 148030.00 25130.48 Luzhou Wanyou Automobile Service Co. Ltd. 129140.00 4401.62 China Changan Automobile Group Hefei Investment Co. Ltd. 106890.47 - Harbin Dongan Auto Engine Co. Ltd. 106468.60 4839.23 Jiangling Holding Co. Ltd. 47703.40 1182839.61 Chongqing Construction Tongda Industrial Co. Ltd. 33787.00 21164.90 Hubei Xiaogan Huazhong Automobile Light Co. Ltd. 27828.32 1349.36 Chengdu Wanyou Trading Co. Ltd. 11391.20 12333.20 Dajiang Yapp Automotive Systems Co. Ltd. 10855.59 - Panzhihua Wanyou Auto Sales & Service Co. Ltd. 4550.30 24646.80 China Changan Automobile Group Co. Ltd. 1000.00 1000.00 SIAMC Management Co. Ltd. - 253750000.00 Chongqing Changan Kuayue Automobile Co. Ltd. - 163007855.00 Ald Fortune Auto Leasing & Renting (Shanghai) Co. Ltd. - 1500000.00 Hubei Huazhong Marelli Automobile Lighting Co. Ltd. - 530196.00 Gkn Huayu Driveline Systems(chongqing) Co. Ltd. - 89857.60 Subtotal 627644.88 420155613.80 Total 611209294.41 641024733.78 233Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 6. Amounts due from/to related parties (continued) (9) Non-current liability within 1 year Related parties 2022 2 021 Chongqing Changan New Energy Vehicles Technology Co.Ltd. 244429325.65 15459375 9.05 (11) Long-term payables Related parties 2022 2021 Chongqing Changan New Energy Vehicles Technology Co.Ltd. 408939511.34 642513537.69 7. Cash deposited in related party Related parties 2022 2021 China South Industry Group Finance Co. Ltd. 19862952043.78 19652980551.77 Changan Automobile Finacing Co. Ltd. 14950000000.00 12000000000.00 Total 34812952043.78 31652980551.77 In 2022 deposit rates in related party are 0.455%-2.25% deposit terms are 0 to 12 months. (in 2021 deposit rate was 0.35% to 3.5% terms are 0 to 12 months.) 8. Loans from related parties Short-term loans 2022 Related parties Category Beginning balance Addition Repay Ending balance China South Industry Group Finance Co. Ltd. Credit loan - 18070000.00 18070000.00 - Mortgage China South Industry Group Finance Co. Ltd. loan 19000000.00 29000000.00 19000000.00 29000000.00 Total 19000000.00 47070000.00 37070000.00 29000000.00 2021 Related parties Category Beginning balance Addition Repay Ending balance China South Industry Group Finance Co. Ltd. Credit loan 530000000.00 - 530000000.00 - Mortgage China South Industry Group Finance Co. Ltd. loan 48000000.00 48000000.00 77000000.00 19000000.00 Total 578000000.00 48000000.00 607000000.00 19000000.00 Refer to Note V 21 for the details of the interest rates of the short-term loan. 234Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 8. Loans from related parties (continued) Long-term loans and non-current liability within 1 year 2022 Related parties Category Beginning balance Addition Repay Ending balance China South Industry Group Finance Co. Ltd. Credit loan 54300000.00 40000000.00 54300000.00 40000000.00 2021 Related parties Category Beginning balance Addition Repay Ending balance China South Industry Group Finance Co. Ltd. Credit loan 55300000.00 - 1000000.00 54300000.00 Refer to Note V 31 for the details of the interest rates of the long-term loan.XI Share-based payments 20222021 Total amount of equity instruments granted 92920600.00 92920600.00 Services provided by employees in exchange for share-based payments 380209900.00 268539867.92 Equity-settled share payments are as follows: 20222021 Accumulated amount of equity-settled share-based payments included in capital reserve 648749767.92 268539867.92 Equity-settled share-based payments recognized as expenses 380209900.00 268539867.92 With the approval of the Board of Directors and the General Meeting of Shareholders of the Company the equity incentive plan implemented in 2021 is as follows: 1) the Company granted a total of 76195400 restricted A-share ordinary shares to a total of 1247 directors senior management middle management and core technical (business) backbone personnel of the Company in February 2021 at a grant price of RMB6.66 per share. 2) the Company repurchased and cancelled 1036000 A shares of 11 incentive objects at the price of RMB 4.54/share in September 2021. 3) the Company granted a total of 17761200 reserved restricted A-share shares to a total of 356 specific senior management middle management and core technical (business) personnel of the Company in November 2021 at a grant price of RMB9.93 per share. The fair value of the equity instrument on the grant date is determined based on the closing price of the outstanding shares on the grant date of the company.The arrangements for the restricted shares mentioned above are as follows: 235Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) XI Share-based payments(continued) Release restricted Release restricted timeline Release arrangement restricted percentage The first release From the first trading day 24 months after the completion of the 33% restricted period registration of the corresponding restricted stock to the date of completion of the registration of the corresponding restricted stock on the last trading day within 36 months from the date of completion of the registration of the corresponding restricted stock The second released From the first trading day after 36 months from the date of 33% restricted period completion of the registration of the corresponding restricted stock to the date of completion of the registration of the corresponding restricted stock the last trading day within 48 months from the date of completion of the registration of the corresponding restricted stock The third released From the first trading day after 48 months from the date of 34% restricted period completion of the registration of the corresponding restricted stock to the date of completion of the registration of the corresponding restricted stock the date of completion of the last trading day within 60 months The arrangements for the release of the restricted shares mentioned above are as follows: Release restricted Performance appraisal conditions period The first release Based on the performance of 2019 the compound annual growth rate of net profit restricted period in 2021 ≥50% and should not be lower than the average level of the same industry or the 75th quartile value of the benchmark enterprise and the 2021 △ EVA is positive. The return on net assets in 2021 ≥ 1.7% and should not be lower than the average level of the same industry or the 75th quartile value of the benchmark enterprise.The second released Based on the performance of 2019 the compound annual growth rate of net profit restricted period in 2022 ≥ 42% and should not be lower than the average level of the same industry or the 75th quartile value of the benchmark enterprise and the 2022 △ EVA is positive. The return on net assets in 2022 ≥ 4.8% and should not be lower than the average level of the same industry or the 75th quartile value of the benchmark enterprise.The third released Based on the performance of 2019 the compound annual growth rate of net profit restricted period in 2023 ≥32% and should not be lower than the average level of the same industry or the 75th quartile value of the benchmark enterprise and the 2023 △ EVA is positive. The return on net assets in 2023 ≥ 5.5% and should not be lower than the average level of the same industry or the 75th quartile value of the benchmark enterprise. 236Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) XII Contingencies and commitments 1. Commitments Contracted but not provided for 20222021 Capital commitments 11675534857.57 9188776086.05 Investment commitments 1782940000.00 1509000000.00 Total 13458474857.57 10697776086.05 For the lease commitment as the lessee please see Note 14 2. 2. Contingencies As at 31 December 2022 no material contingencies needed to be disclosed.XIII Events after the balance sheet date 1. The dividends after balance sheet date The profit distribution plan for 2022 is detailed in note V 44. 2. Other events after the balance sheet date In December 2022 with the approval of the 49th meeting of the 8th Board of Directors and the 4th extraordinary general meeting of shareholders the company will acquire 2.63% of the equity of Chongqing Changan New Energy Vehicles Technology Co. Ltd (hereinafter referred to as "New Energy Technology") from Chongqing Liangjiang New Area Chengwei Equity Investment Fund Partnership (Limited Partnership) and 7.71% of equity of New Energy Technology from Changxin Equity Investment Fund Partnership (Limited Partnership) for RMB 1.332 billion. After the completion of the acquisition the company’s shareholding in New Energy Technology increased from 40.6559% to 50.9960% and New Energy Technology will change from an associate accounted for by the equity method to a holding subsidiary. As at the date of this report the relevant acquisitions have been completed and New Energy Technology has been included in the scope of the Group's consolidated statements since February 2023. 237Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) XIV Other important event 1. Segment report The Group identifies operating segments based on the internal organization structure managerial requirements and internal reporting system and identifies reportable segments based on operating segments and discloses segment information by operating segment.An operating segment is a component of the Group that meets all the following conditions: (1) it engages in business activities from which it may earn revenues and incur expenses; (2) its operating results are regularly reviewed by the Company’s management to make decisions about resources to be allocated to the segment and assess its performance; and (3) the Group can obtain relevant accounting information such as its financial position operating results and cash flows.If two or more segments have similar economic characteristics and meet certain conditions they can be aggregated into a single operating segment.The revenue and profit of the Group mainly consist of the automobile manufacturing and domestic sales. The Group’s principal assets are in China. The operating performance of the Group has been evaluated as a whole by the management. So the segment report has not been prepared for this year. 2. Lease arrangements (1) As lessor The Group leases buildings machinery and equipment and vehicles for a lease term of 1-15 years forming an operating lease. Details for investment property and operating leased fixed assets refer to note V 12 and 13.The income related to operating leases are listed as follows: 20222021 Leasehold Income 414625233.74 269945865.23 238Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 2. Lease arrangements (continued) According to the lease contract signed with the lessee the minimum lease collection amount of irrevocable lease is as follows: 20222021 Less than 1 year (including 1 year) 485069034.35 431996621.28 1 to 2 years (including 2 years) 393916228.04 367687620.42 2 to 3 years (including 3 years) 258908078.26 327218497.55 3 to 4 years (including 3 years) 116180073.26 240066615.96 4 to 5 years (including 3 years) 33175628.20 95177907.96 Over 5 years 25435140.79 29888877.61 1312684182.901492036140.78 (2) As lessee 20222021 Interest expense of lease liabilities 3315624.26 3238026.58 Short term lease expenses with simplified treatment included in current profit and loss 68405663.80 78921021.42 Lease expense of low value assets with simplified treatment included in current profit and loss 3208292.72 2566698.86 Total cash outflow related to leasing 96132331.89 119748677.95 The leased assets leased by the Group include buildings and other equipment used in the operation activities. The lease term of houses and buildings is usually 1-5 years and that of other equipment is usually 2-5 years. 239Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) XV Notes to the Company’s financial statements 1. Accounts Receivable (1) Aging analysis of accounts receivable as at 31 December 2022 is as follows: 20222021 Less than 1 year (including 1 year) 4445068297.55 6741369355.22 1 to 2 years (including 2 years) 997705973.80 353774325.51 2 to 3 years (including 3 years) - 227529170.91 Over 3 years 213599440.84 711074867.37 5656373712.198033747719.01 Less：Provision (117868890.37) (102237112.42) 5538504821.827931510606.59 (2) Movements of provision for accounts receivable are as follows: Beginning balance Provision Write-off Ending balance 2022102237112.4217018007.911386229.96117868890.37 202193484241.668752870.76-102237112.42 (3) Analysis of the accounts receivable by category as at 31 December 2022 is as follows: 2022 Balance Provision Amount % Amount % Individually analyzed provision 5137221177.03 90.82 76252846.20 1.48 Provision for bad debts based on credit risk characteristics 519152535.16 9.18 41616044.17 8.02 Total 5656373712.19 100.00 117868890.37 2.08 2021 Balance Provision Amount % Amount % Individually analyzed provision 7844348937.41 97.64 77639076.15 0.99 Provision for bad debts based on credit risk characteristics 189398781.60 2.36 24598036.27 12.99 Total 8033747719.01 100.00 102237112.42 1.27 240Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 1. Accounts Receivable (continued) (4) Accounts receivable was analyzed for provision by expected credit loss model: 20222021 Balance amount % Provision Balance amount % Provision Within 1 year 452608491.21 0.89 4009679.22 153480402.70 0.42 642592.90 1 to 2 years 30625665.06 7.23 2214135.18 - - - 2 to 3 years - - - 655000.31 10.84 71031.12 Over 3 years 35918378.89 98.54 35392229.77 35263378.59 67.73 23884412.25 Total 519152535.16 8.02 41616044.17 189398781.60 12.99 24598036.27 (5) As at 31 December 2022 accounts receivable from top 5 clients amounted to RMB 3044844058.24 accounted for 53.83% of the total amount (2021：RMB 4129668343.88 accounted for 51.40% of the total amount). (6) There are no accounts receivable derecognized due to transference of financial assets during 2022 (2021: Nil). 2. Other receivables (1) Aging analysis of other receivables as at 31 December 2022 is as follows: 20222021 Within 1 year 842446117.27 1745128693.03 1 to 2 years 7116112.63 1413046.51 2 to 3 years 1226346.51 497065.04 Over 3 years 15300830.26 16804017.31 866089406.671763842821.89 Less：Provision (7062658.03 ) (7219239.96) Total 859026748.64 1756623581.93 (2) Analysis of other receivables by nature is as follows: 20222021 Prepaid equity investment 399486432.52 526670000.00 Energy-saving and new energy subsidy 338394118.63 358470077.96 Pretty cash 62920147.86 21998665.75 Internal transactions 32946539.47 791370940.07 Others 25279510.16 58113898.15 Total 859026748.64 1756623581.93 241Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 2. Other Receivable (continued) (3) In 2022 the changes in the provision for bad debts for other receivables based on the 12- month expected credit loss and the expected credit loss for the entire duration are as follows Beginning balance Provision Reversal Ending balance 20227219239.96-156581.937062658.03 20217154284.7964955.17-7219239.96 (4) As at 31 December 2022 top five debtors of other receivables are as follows: Amount Aging Proportion of Ending total other balance of Debtors receivables (%) provision 1st 338394118.63 Within 1 year 39.07 - 2nd 297876247.07 Within 1 year 34.39 - 3nd 101610185.45 Within 1 year 11.73 - 4th 18673042.75 Within 1 year 2.16 - 5th 16186569.01 Within 1 year 1.87 - Total 772740162.91 89.22 (5) As of December 31 2022 the company had no other receivables that were derecognized as a transfer of financial assets (December 31 2021: Nil). 242Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 3. Long-term investments 2022 Investee Opening Balance Addition Reduction Investment Other Other changes in Dividend of cash Other Ending Balance Ending Balance income/loss under comprehensive equity declared deduction of provision equity method income comprehensive income Joint ventures Changan Ford Automobile Co. Ltd. 2934876043.99 - - (1222416692.14 ) - - (1000000000.00 ) - 712459351.85 - Changan Mazda Automobile Co. Ltd. 1867086106.67 - - 45093349.65 - - (478875000.00 ) - 1433304456.32 - Changan Mazda Engine Co. Ltd. 835121564.38 - - 30420484.67 - - (41500000.00 ) - 824042049.05 - Nanchang Jiangling Investment Co. Ltd. 1630596420.97 - - 179430391.82 602832.07 - - - 1810629644.86 - Subtotal of joint ventures 7267680136.01 - - (967472466.00 ) 602832.07 - (1520375000.00 ) - 4780435502.08 - Associates Chongqing Changan Kuayue Automobile Co. Ltd. 242792196.86 - - (33023260.52 ) - - - - 209768936.34 - Chongqing Changan Kuayue Automobile Sales Co. Ltd. - - - - - - - - - - Beijing Fang Anxin Yue Rental Auto Co.Ltd. - - - - - - - - - - Changan Automobile Finacing Co. Ltd. 2520349332.44 - - 325492694.33 - - (66943616.44 ) - 2778898410.33 - Hainan Anxinxing Information Technology Co. Ltd. - 368900.00 (849.01 ) (368050.99 ) - - - - - - Nanjing Chelai Travel Technology Co. Ltd. 866888.90 - - (242115.59 ) - - - - 624773.31 - Coresing Semiconductor Technology Co. Ltd. 25285116.95 - - 167308.31 - - - - 25452425.26 - Nanjing Leading Equity Investment Partnership (Limited Partnership) 2424143949.52 - - 146277515.18 - - - - 2570421464.70 - Nanjing Leading Equity Investment Management Co. Ltd. 1133065.60 - - (20854.91 ) - - - - 1112210.69 - Jiangling Holding Co. Ltd. 70492790.08 - - (70492790.08 ) - - - - - - Chongqing Changan New Energy Vehicles Technology Co.Ltd. - 1360000000.00 - (1653680684.65 ) - 663566110.70 - - 369885426.05 - Zhongqi Chuangzhi Technology Co. Ltd. 190534997.15 - - (22042206.37 ) - - - - 168492790.78 - Chongqing Changxin Zhiqi Private Equity Investment Fund Partnership (Limited Partnership) 25007587.62 133187500.00 - 12244966.46 - - - - 170440054.08 - Anhe Chongqing Dingfeng Auto Contractual Private Equity Investment Fund - 61744000.00 - (175293.92 ) - - - - 61568706.08 - Avatr Technology (Chongqing) Co. Ltd. - 2040266561.89 - (811903504.78 ) (75815.98 ) - - - 1228287241.13 - Chongqing Changan Innovation Private Equity Investment Fund Partnership (Limited Partnership) - 1000000.00 - 844.59 - - - - 1000844.59 - Subtotal of associates 5500605925.12 3596566961.89 (849.01 ) (2107765432.94 ) (75815.98 ) 663566110.70 (66943616.44 ) - 7585953283.34 - 243Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 3. Long-term investments (continued) 2022 (continued) Investee Opening Balance Addition Reduction Investment Other Other changes in Dividend of cash Others Ending Balance Ending Balance of income/loss under comprehensive equity declared provision equity method income comprehensive income Subsidiaries Nanjing Changan Automobile Co. Ltd. 422533259.00 - - - - - - - 422533259.00 - Chongqing Changan International 13068581.00 190000000.00 - - - - - - 203068581.00 - Chongqing C hang an A utom obile Supporting 29700000.00 - - - - - - - 29700000.00 - Chongq ing C han gan Connected Car 88500000.00 - - - - - - - 88500000.00 - Chongqing C han gan Special Automobile Co. 2500000.00 - - - - - - - 2500000.00 - Cho ngqing Changan Europe Design 155469913.50 - - - - - - - 155469913.50 - Chongqin g Ch anga n New Energy - - - - - - - - - (49194195.00 ) Changan Un ited King dom R&D Center Co. 250093850.95 - - - - - - - 250093850.95 - Beiji ng Changan R&D Center Co. Ltd. 1000000.00 - - - - - - - 1000000.00 - Changan Japan Designing Center Co.Ltd. 1396370.15 - - - - - - - 1396370.15 - Changan United States R&D Center Co. Ltd. 10243460.00 - - - - - - - 10243460.00 - Hefei Changan Automobile Co.Ltd. 1535367765.23 - - - - - - - 1535367765.23 - Changan Automobile Russia Co. Ltd. 251242589.15 - - - - - - - 251242589.15 - Changan Brazil Holdings Limited 2584556.97 - (2584556.97 ) - - - - - - - Changan Automobile Investment 235248871.00 2640640.00 - - - - - - 237889511.00 - Nanjing Cha nga n Ne w Energy Automobile 50000000.00 - - - - - - - 50000000.00 - Chon gq ing Any i Aut omo bile Technical 2000000.00 - - - - - - - 2000000.00 - Xiamen Cha ngan New Energy Automobile 2000000.00 - - - - - - - 2000000.00 - Gua ngzh ou Changan New Energy 4000000.00 - - - - - - - 4000000.00 - Chongqing C han gan Lingyao Automobile 594949059.30 - - - - - - - 594949059.30 - Cho ngqin g Chehemei Technology Co. Ltd. 10000000.00 - - - - - - - 10000000.00 - Chongqing Changan Kaicheng Automobile 977793971.55 - - - - - - - 977793971.55 - Chongqing C han gan A u t omobile Software 99000000.00 - - - - - - - 99000000.00 - Chongqing C han gan T echnology Co. Ltd. - 90000000.00 - - - - - - 90000000.00 - Avatr Technology (Chongqing) Co. Ltd. 153841669.77 - - - - - - (153841669.77 ) - - Subtotal of subsidiaries 4892533917.57 282640640.00 (2584556.97 ) - - - - (153841669.77 ) 5018748330.83 (49194195.00 ) Total 17660819978.70 3879207601.89 (2585405.98 ) (3075237898.94 ) 527016.09 663566110.70 (1587318616.44 ) (153841669.77 ) 17385137116.25 (49194195.00 ) 244Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 3. Long-term investments (continued) 2021 Investee Opening Balance Addition Investment income/loss Other comprehensive Other changes in Dividend of cash Ending Balance Ending Balance under equity method income equity declared of provision Joint ventures Changan Ford Automobile Co. Ltd. 1791533495.17 - 1143342548.82 - - - 2934876043.99 - Changan Mazda Automobile Co. Ltd. 1995998622.28 - 417328331.92 - 173259152.47 (719500000.00 ) 1867086106.67 - Changan Mazda Engine Co. Ltd. 832869256.44 - 41752307.94 - - (39500000.00 ) 835121564.38 - Nanchang Jiangling Investment Co. Ltd. 1545807633.84 - 86068773.02 (1279985.89) - - 1630596420.97 - Subtotal of joint ventures 6166209007.73 - 1688491961.70 (1279985.89 ) 173259152.47 (759000000.00 ) 7267680136.01 - Associates Chongqing Changan Kuayue Automobile Co. Ltd. 237736134.21 - 8486062.65 - - (3430000.00 ) 242792196.86 - Chongqing Changan Kuayue Automobile Sales Co. Ltd. - - - - - - - - Beijing Fang’an cresent taxi Co. Ltd. - - - - - - - - Changan Automobile Finacing Co. Ltd. 2337849374.75 - 247691770.61 - - (65191812.92 ) 2520349332.44 - Hainan Anxinxing Information Technology Co. Ltd. 2316052.92 - (2316052.92 ) - - - - - Nanjing Chelai Travel Technology Co. Ltd. 1192605.27 - (325716.37) - - - 866888.90 - Coresing Semiconductor Technology Co. Ltd. 25373809.47 - 47460.39 - - (136152.91 ) 25285116.95 - Nanjing Leading Equity Investment Partnership (Limited - Partnership) 999636607.63 741732283.00 682775058.89 - - 2424143949.52 - Nanjing Leading Equity Investment Management Co. Ltd. 1262180.39 - (129114.79 ) - - - 1133065.60 - Jiangling Holding Co. Ltd. 201736644.25 - (131243854.17 ) - - - 70492790.08 - Chongqing Changan New Energy Vehicles Technology Co. - Ltd. 1042156607.05 - (1042156607.05) - - - - Zhongqi Chuangzhi Technology Co. Ltd. 100000000.00 100000000.00 (9465002.85) - - - 190534997.15 - Chongqing Changxin Zhiqi Private Equity Investment Fund Partnership (Limited Partnership) - 25500000.00 (492412.38 ) - - - 25007587.62 - Subtotal of associates 4949260015.94 867232283.00 (247128407.99 ) - - (68757965.83 ) 5500605925.12 - 245Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 3. Long-term investments (continued) 2021 (continued) Investee Opening Balance Addition Investment income/loss Other Other changes in Dividend of cash Ending Balance Ending Balance of under equity method comprehensive equity declared provision income Subsidiaries - - - - - - - Nanjing Changan Automobile Co. Ltd. 422533259.00 - - - - - 422533259.00 - Chongqing Changan International Automobile Sales Co. Ltd. 13068581.00 - - - - - 13068581.00 - Chongqing Changan Automobile Supporting Service Co. Ltd. 29700000.00 - - - - - 29700000.00 - Chongqing Changan Connected Car Technology Co. Ltd. 88500000.00 - - - - - 88500000.00 - Chongqing Changan Special Automobile Co. Ltd. 2500000.00 - - - - - 2500000.00 - Chongqing Changan Europe Design Academy Co. Ltd. 155469913.50 - - - - - 155469913.50 - Chongqing Changan New Energy Automobile Co. Ltd. - - - - - - - (49194195.00) Changan United Kingdom R&D Center Co. Ltd. 250093850.95 - - - - - 250093850.95 - Beijing Changan R&D Center Co. Ltd. 1000000.00 - - - - - 1000000.00 - Changan Japan Designing Center Co.Ltd. 1396370.15 - - - - - 1396370.15 - Changan United States R&D Center Co. Ltd. 10243460.00 - - - - - 10243460.00 - Hefei Changan Automobile Co.Ltd. 1535367765.23 - - - - - 1535367765.23 - Changan Automobile Russia Co. Ltd. 251242589.15 - - - - - 251242589.15 - Changan Brazil Holdings Limited 2584556.97 - - - - - 2584556.97 - Changan Automobile Investment (Shenzhen) Co. Ltd. 235248871.00 - - - - - 235248871.00 - Nanjing Changan New Energy Automobile Sales & Service 50000000.00 - - - - - 50000000.00 - Chongq ing A nyi Automobile Technical Service Co. Ltd. 2000000.00 - - - - - 2000000.00 - Xiamen Changan New Energy Automobile Co. Ltd. 2000000.00 - - - - - 2000000.00 - Guangzhou Changan New Energy Automobile Co. Ltd. 4000000.00 - - - - - 4000000.00 - Chongqing Changan Lingyao Automobile Co. Ltd. 594949059.30 - - - - - 594949059.30 - Chongqing Chehemei Technology Co. Ltd. 10000000.00 - - - - - 10000000.00 - Chongqing Changan Kaicheng Automobile Technology Co. 976475558.18 1318413.37 - - - - 977793971.55 - Chongq in g Changan Automobile Software Technology Co. 99000000.00 - - - - - 99000000.00 - Avatr Te c hnology (Chongqing) Co. Ltd. 58461669.77 95380000.00 - - - - 153841669.77 - Subtotal of subsidiaries 4795835504.20 96698413.37 - - - - 4892533917.57 (49194195.00) Total 15911304527.87 963930696.37 1441363553.71 (1279985.89) 173259152.47 (827757965.83) 17660819978.70 (49194195.00) 246Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 4. Operating revenue and cost 20222021 Revenue Cost Revenue Cost Primary Operation 99659461376.20 83039189231.43 90985611205.39 80344375608.83 Other Operation 7005683913.08 3202290576.52 7317328166.58 3794210191.83 Total 106665145289.28 86241479807.95 98302939371.97 84138585800.66 Operating revenue listed as follows: 20222021 Sales of goods 100724925838.45 93345887353.11 Provision of services and others 5940219450.83 4957052018.86 Total 106665145289.28 98302939371.97 The breakdown of operating revenue generated from contracts with customers is as follows: 20222021 Revenue recognition time Recognize revenue at a certain point in time 105965019826.80 97549755107.36 Recognize revenue within a certain period of time 700125462.48 753184264.61 Total 106665145289.28 98302939371.97 The income recognized in the current year and included in the book value of contract liabilities at the beginning of the year is as follows: 20222021 Sales of goods 8024058722.97 3305994526.82 Provision of services and others 422441293.07 137381961.13 Total 8446500016.04 3443376487.95 247Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 4. Operating revenue and cost (continued) The estimated time when the total transaction price that has not been fulfilled (or partially fulfilled) performance obligations allocated to the end of the year is recognized as revenue is as follows: 20222021 Within 1 year 3997514972.13 8446500016.04 More than 1 year 844435549.31 715087257.75 Total 4841950521.44 9161587273.79 5. Investment income/loss (1) Details of investment income 20222021 Long-term equity investment income accounted for by the cost method 653072387.00 - Long-term equity investment income/(loss) accounted for by the equity method (3075237898.94) 1441363553.71 The investment income of financial asset held for trading during its holding period 3289610.51 3363000.00 Dividend income from remaining investments in other equity instruments 160088164.16 78499905.15 Investment income from disposal of long-term equity investments (1805399.76) - Gains from the remeasurement of the remaining equity at fair value after the loss of control 337514571.42 - Interest income from entrusted loan - 8099253.11 Total (1923078565.61) 1531325711.97 248Chongqing Changan Automobile Company Limited Notes to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) 5. Investment income/loss (continued) (2) Long-term equity investment income under equity method Investee 2022 2021 Reason for the fluctuation Decrease in profit due Changan Ford Automobile Co. Ltd. (1222416692.14 ) 1143342548.82 to sales decline Decrease in profit due Changan Mazda Automobile Co. Ltd. 45093349.65 417328331.92 to sales decline Changan Mazda Engine Co. Ltd. 30420484.67 41752307.94 Increase in Nanchang Jiangling Investment Co. Ltd. 179430391.82 86068773.02 investment income Jiangling Holding Co. Ltd. (70492790.08 ) (131243854.17) Decrease in profit due Chongqing Changan Kuayue Automobile Co. Ltd. (33023260.52) 8486062.65 to sales decline Changan Automobile Finacing Co. Ltd. 325492694.33 247691770.61 Loss at the beginning Avatr Technology (Chongqing) Co. Ltd. (811903504.78 ) - of operations Hainan Anxinxing Information Technology Co. Ltd. (368050.99 ) (2316052.92) Nanjing Chelai Travel Technology Co. Ltd. (242115.59 ) (325716.37) Nanjing Leading Equity Investment Partnership Decrease in fair value (Limited Partnership) 146277515.18 682775058.89 premium Nanjing Leading Equity Investment Management Co. Ltd. (20854.91 ) (129114.79) Coresing Semiconductor Technology Co. Ltd. 167308.31 47460.39 Chongqing Changan New Energy Vehicles Technology Co.Ltd. (1653680684.65 ) (1042156607.05) Increase in loss Zhongqi Chuangzhi Technology Co. Ltd. (22042206.37 ) (9465002.85) Chongqing Changxin Zhiqi Private Equity Investment Fund Partnership (Limited Partnership) 12244966.46 (492412.38) Anhe Chongqing Dingfeng Auto Contractual Private Equity Investment Fund (175293.92 ) - Chongqing Changan Innovation Private Equity Investment Fund Partnership (Limited Partnership) 844.59 - Total (3075237898.94) 1441363553.71 249Chongqing Changan Automobile Company Limited Supplementary Information to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) Supplementary information 1. Schedule of non-recurring profit and loss 2022 Non-current asset disposal gains and losses (including the write-off portion of the asset impairment provision) 74862481.00 Government subsidies included in the current profit and loss (closely related to the business of the enterprise except for government subsidies that are fixed or quantified according to the national unified standard) 1134358181.32 Interest on late payment of funds charged to non-financial enterprises 40505154.81 In addition to the effective hedging business related to the company's normal business operations the fair value changes in gains and losses arising from holding trading financial assets 3570229.29 Reversal of impairment provision for accounts receivable that are tested separately for impairment 2847641.57 Investment income from the disposal of long-term equity investments 2128313646.36 Other non-operating income and expenses other than the above 77519377.00 Income tax impact (94817746.44) Minority shareholders' equity impact (after tax) (27627185.99) Total 3339531778.92 The Group disclosed non-recurring profit and loss items in accordance with the regulations issued by China Security Regulation Commission No 1 Regulation of Information Disclosure of Public Companies-Non-recurring Profit and Loss 250Chongqing Changan Automobile Company Limited Supplementary Information to Financial Statement Year ended 31 December 2022 (Expressed in Renminbi Yuan) Supplementary information 2. Return on equity and earnings per share 2022 Weighted average Earnings per share return on equity (%) Basic EPS Diluted EPS Net profit attributable to the Company’s ordinary shareholders 13.07 0.7960 0.7799 Net profit attributable to the Company’s ordinary shareholders after deducting non-recurring profit and loss 7.47 0.4538 0.4459 2021 Weighted average Earnings per share return on equity (%) Basic EPS Diluted EPS Net profit attributable to the Company’s ordinary shareholders 6.53 0.3616 0.3579 Net profit attributable to the Company’s ordinary shareholders after deducting non-recurring profit and loss 3.04 0.1670 0.1665 In accordance with the regulations issued by China Security Regulation Commission Regulation of Information Disclosure of Public Companies—the Calculation and Disclosure of Return of Net Assets and Earning per Share (2010 Revision) the Group disclosed the return of net assets and earnings per share in the reporting period. 251