2013 Annual Report of Wuxi Little Swan Company Limited Wuxi Little Swan Company Limited
2013 Annual Report
March 2014
2013 Annual Report of Wuxi Little Swan Company Limited Section I. Important Reminders, Catalogue& Explanation The Board of Directors, the Supervisory Committee as well as all directors, supervisors and senior management staff of Wuxi Little Swan Company Limited (hereinafter referred to as “the Company”) warrant that this report is factual, accurate and complete without any false record, misleading statement or material omission. And they shall be jointly and severally liable for that.
All directors attended the board session for reviewing this report.
TheCompany’s profit distribution preplan upon review and approval of this board session: Based on the total shares of the Company as at 31 Dec. 2013, a cash dividend of RMB 3.00 (tax included) will be distributed for every 10 shares held by shareholders. No bonus shares will be granted and no capital reserve will be turned into share capital.
Mr. Fang Hongbo, company principal, Mr. Zhang Zhaofeng, chief of the accounting work, and Mr. Zhong Fangliu, chief of the accounting organ (chief of accounting), hereby confirm that the Financial Report enclosed in this report is factual, accurate and complete.
This report involves futures plans and some other forward-looking statements, which shall not be considered as virtual promises to investors. Investors are kindly reminded to pay attention to possible risks.
This report is prepared in both Chinese and English. Should there be any discrepancy between the two versions, the Chinese version shall prevail.
2013 Annual Report of Wuxi Little Swan Company Limited Catalogue
Section I. Important Reminders, Catalogue& Explanation .......................................................... 2 Section II. Company Profile .............................................................................................................. 6 Section III. Accouonting& Business Highlights ............................................................................. 8 Section IV. Report of the Board of Directors ................................................................................. 10 Section V. Significant Events ........................................................................................................... 31 Section VI. Change in Shares& Shareholders .............................................................................. 42 Section VII. Directors, Supervisors, Senior Management Staff& Employees ........................... 50 Section VIII. Corporate Governance ............................................................................................. 57 Section IX. Internal Control ........................................................................................................... 61 Section X. Financial Report ................................................................................................................ Section XI. Documents Available for Reference ................................................................................
2013 Annual Report of Wuxi Little Swan Company Limited Explanation
||||
|-|-|-|
|Term|Refers to|Contents|
|Company, the Company or Little Swan|Refers to|Wuxi Little Swan Company Limited|
|Midea Group|Refers to|Midea Group Co., Ltd.|
|Midea Group Finance|Refers to|Midea Group Finance Co., Ltd.|
|Midea Holding|Refers to|GD Midea Holding Co., Ltd.|
|Reporting period|Refers to|1 Jan. 2013-31 Dec. 2013|

2013 Annual Report of Wuxi Little Swan Company Limited Reminder of Major Risks
1. Market risks: The uncertain domestic real estate market and unrest in the overseas political environment have brought uncertainty to market demand. Meanwhile, the rise and rapid development of e-commerce poses challenges to traditional marketing modes.
2. Cost risks: In 2013, the prices of bulk raw materials remained relatively low. If they go to a much higher level in 2014, theCompany’s profitability will be directly affected. Along with the rise of labor cost, cost pressure on the Company will build up.
3. Exchange rate risks: The fluctuation in exchange rate is very much uncertain. Though the Company has adopted certain counter measures against exchange rate fluctuation, the Company would still be largely affected in profitability of overseas sales by fluctuated exchange rate.
4. Policy risks: In overseas market, the promotion of non-tariff trade barriers and possible anti-dumping policy would affect the scale and profitability of theCompany’s overseas business.
2013 Annual Report of Wuxi Little Swan Company Limited Section II. Company Profile
I. Basic information of the Company
|||||
|-|-|-|-|
|Stock abbreviation|XTEA, XTEB|Stock code|000418, 200418|
|Stock exchange listed with|Shenzhen Stock Exchange|||
|Chinese name of the Company|无锡小天鹅股份有限公司|||
|Abbr. of the Chinese name of the Company|小天鹅|||
|English name of the Company (if any)|Wuxi Little Swan Company Limited|||
|Legal representative of the Company|Mr. Fang Hongbo|||
|Registered address|No. 18, Changjiang Road S., National Hi-tech Development Zone, Wuxi|||
|Postal code for the registered address|214028|||
|Office address|No. 18, Changjiang Road S., National Hi-tech Development Zone, Wuxi|||
|Postal code for the office address|214028|||
|Internet website of the Company|http://www.littleswan.com|||
|Email address|IR_littleswan@littleswan.com.cn|||

II. For Contact
||||
|-|-|-|
||Company Secretary|Securities Affairs Representative|
|Name|Ms. Zhou Sixiu|Ms. Tian Lin|
||No. 18, Changjiang Road S., National|No. 18, Changjiang Road S., National|
|Contact address|||
||Hi-tech Development Zone, Wuxi|Hi-tech Development Zone, Wuxi|
|Tel.|0510-81082320|0510-81082377|
|Fax|0510-83720879|0510-83720879|
|E-mail|IR_littleswan@littleswan.com.cn|IR_littleswan@littleswan.com.cn|

III. About information disclosure and where this report is placed
|||
|-|-|
|Newspapers designated by the Company for||
||Securities Times, Ta Kung Pao (HK)|
|information disclosure||
|Internet website designated by CSRC for||
||http://www.cninfo.com.cn|
|disclosing this report||
|Where this report is placed|Securities Department of the Company|

2013 Annual Report of Wuxi Little Swan Company Limited IV. Change of the registered information
|||||||
|-|-|-|-|-|-|
|||||Registration code of||
||Registration date|Registration place|Business license No.||Organizational code|
|||||taxation||
|||Industrial and||||
|||Commercial||||
|Initial registration|29 November 1993|Administration|13590586-X-1|320200704046760|70404676-0|
|||Bureau of Wuxi,||||
|||Jiangsu||||
|||Industrial and||||
|||Commercial||||
|At the end of the||||||
||25 March 2011|Administration|320200000014723|320200704046760|70404676-0|
|reporting period||||||
|||Bureau of Wuxi,||||
|||Jiangsu||||
|Changes of the main business since listing||Unchanged||||
|Changes of the controlling shareholder||Unchanged||||

V. Other information
The CPAs firm hired by the Company:
|||
|-|-|
|Name|Jiangsu Gongzheng Tianye Certified Public Accountants LLP|
|Office address|No. 28, Liangxi Road, Wuxi|
|Signing accountants|Dai Weizhong, Yu Zhiqiang|

Sponsor engaged by the Company to conduct sustained supervision during the reporting period
√ Applicable□ Inapplicable
|||||
|-|-|-|-|
|Name|Office address|Sponsor representative|Consistent supervision period|
||||From 4 Aug. 2006 to the date|
||||when all non-tradable share|
||25/F, CTS Tower, No. 4011||holders pay off the|
|Huatai United Securities Co.,||||
||Shennan Road, Shenzhen,|Bian Jianguang|considerations that have been|
|Ltd.||||
||Guangdong||paid in advance for them and|
||||the non-tradable shares are|
||||unlocked|

Financial consultant engaged by the Company to conduct sustained supervision during the reporting period□ Applicable√ Inapplicable
2013 Annual Report of Wuxi Little Swan Company Limited Section III. Accounting& Business Highlights
I. Major accounting data and financial indicators
Does the Company adjust retrospectively or restate accounting data of previous years due to change of the accounting policy or correction of any accounting error?
□ Yes√ No
||||||
|-|-|-|-|-|
||||Increase or||
||||decrease of this||
||2013|2012||2011|
||||year over last year||
||||(%)||
|Operating revenue (RMB Yuan)|8,727,956,044.37|6,899,863,926.81|26.49%|10,975,621,704.52|
|Net profit attributable to shareholders of the|413,350,079.54|338,387,680.99|||
||||22.15%|453,327,963.81|
|Company (RMB Yuan)|||||
|Net profit attributable to shareholders of the|||||
||310,261,096.43|341,978,755.36|-9.27%|364,358,220.01|
|Company after extraordinary gains and losses|||||
|(RMB Yuan)|||||
|Net cash flows from operating activities (RMB|904,882,101.01|344,757,698.15|||
||||162.47%|242,531,309.07|
|Yuan)|||||
|Basic EPS (RMB Yuan/share)|0.65|0.54|20.37%|0.72|
|Diluted EPS (RMB Yuan/share)|0.65|0.54|20.37%|0.72|
|Weighted average ROE (%)|10.88%|9.59%|1.29%|13.99%|
||||Increase or||
||||decrease of this||
||As at 31 Dec. 2013|As at 31 Dec. 2012||As at 31 Dec. 2011|
||||year-end than last||
||||year-end (%)||
|Total assets (RMB Yuan)|9,222,527,380.74|8,403,705,443.29|9.74%|9,145,185,476.94|
|Net assets attributable to shareholders of the|3,908,897,654.74|3,686,210,495.87|||
||||6.04%|3,441,144,937.45|
|Company (RMB Yuan)|||||

II. Items and amounts of extraordinary gains and losses
Unit: RMB Yuan
||||||
|-|-|-|-|-|
|Items|2013|2012|2011|Notes|
|Gain/loss on the disposal of non-current|-1,078,789.83||||
|assets (including the offset part of the asset||5,388,076.41|53,601,089.33||
|impairment provisions)|||||
|Government grants recognized in the current|23,748,858.49||||
|||23,335,697.60|61,717,786.34||
|period, except for those acquired in the|||||

2013 Annual Report of Wuxi Little Swan Company Limited
||||||
|-|-|-|-|-|
|ordinary course of business or granted at|||||
|certain quotas or amounts according to the|||||
|government’s unified standards|||||
|Gain/loss on debt restructuring|2,807,241.09|9,007,539.11|10,188,474.84||
|Impairment provision reversal of accounts|733,146.16||||
|receivable on which the impairment test is|||||
|carried out separately|||||
|Effect on current gains/losses when a|308,469.59||||
|one-off adjustment is made to current|||||
|gains/losses according to requirements of|||||
|taxation, accounting and other relevant laws|||||
|and regulations|||||
|Non-operating income and expense other|9,283,944.96||||
|||7,166,257.62|4,214,334.91||
|than the above|||||
|Other gain and loss items that meet the|97,565,087.41||||
|||-33,250,000.00|||
|definition of an extraordinary gain/loss|||||
|Dismissal expenses|-5,944,610.29|-4,606,067.30|-7,452,612.88||
|Projected liabilities|||-1,199,402.08||
|Less: Income tax effects|9,485,975.81|6,042,660.17|18,070,842.88||
|Minority interests effects (after tax)|14,848,388.66|4,589,917.64|14,029,083.78||
|Total|103,088,983.11|-3,591,074.37|88,969,743.80|--|

 Explain the reasons if the Company classifies an item as an extraordinary gain/loss according to the definition in the Explanatory Announcement No. 1 on Information Disclosure for Companies Offering Their Securities to thePublic—Extraordinary Gains and Losses, or classifies any extraordinary gain/loss item mentioned in the said explanatory announcement as a recurrent gain/loss item
□ Applicable√ Inapplicable
2013 Annual Report of Wuxi Little Swan Company Limited Section IV. Report of the Board of Directors
I. Overview
（I）Sum-up
2013 marked a year of adjustment and change for the household appliance industry of China. Household appliance makers were affected to varying degrees by factors such as industrial structure upgrading, sale forms innovation, withdrawal of stimulus policies, implementation of new energy efficiency standards and uncertainties in the real estate market. 2013 saw recovery of the washing machine industry as a whole, but with differentiation between the domestic and foreign markets. In the domestic market, consumption of washing machines was upgrading noticeably, with the proportion of middle and high-end products on the rise; boosted by factors such as product structure optimization, rapid development of e-commerce and low prices of raw materials, the domestic market of washing machines showed a trend of growth. As for the foreign market, affected by economic and political factors, as well as change in the competition structure, export of washing machines of China was weak, showing a declining trend in general.
In the reporting period, closely adhering to the strategic axis of “leading products, efficiency-driven and global operation”, the Company focused on changes in the industry, improved products, and kept pushing forward and deepening operation transformation to ensure maximum earnings under the optimum business scale. In 2013, theCompany’s efforts in transformation produced initial results, with recovery YoY growth of53.03% in domestic sales. Overseas sales dropped by17.70% on the year-on-year basis due to the overall decline of export and theCompany’s move to adjust its product structure, but with increased profitability. For 2013, the Company achieved sales revenue of RMB 8.728 billion and net profit attributable to the Company (without subsidiaries) of RMB 413 million.
(II) Review of major work
1. Enhanced basic management and increased operating efficiency
2013 was the year for the Company to deepen operational transformation. Through tidying performance management, a performance management mechanism with strategy as the lead and performance as the guidance was established. The Company also tidied core work flows such as the three major work flows of PLC, quality and production, and enhanced appraisal of execution. It unveiled the accountability management methods, defined professional manager conduct as the red line and pushed forward recreation of the corporate culture. At the same time, it optimized its organizational structure and adjusted theR&D organizational structure; carried forward operation of small plants specializing in double-cylinder products and inspired vitality in operation of the double-cylinder washer business; further implemented the concept and requirements of “Quality First” through setting up work flows, tidied the quality management function and increased responsiveness in the quality system; and improved internal control functions and enhanced risk control. Meanwhile, it carried out the lean logistics project to optimize the logistics pattern and increase the overall operating efficiency.
2. Deepened marketing reform and achieved initial results in transformation efforts
In 2013, the Company continued to push forward transformation in marketing and deepen structural reform. In
2013 Annual Report of Wuxi Little Swan Company Limited terms of the domestic sale system, it further cut down and adjusted the organizational structure and moved its focus to the lower tiers of operation to improve the operating quality. It pushed forward the CCS system and established effective control over procurement, sale and storage via channels. It promoted standardization in the retail end and improved the after-sales network, as well as its serviceability. Meanwhile, it vigorously expanded e-commerce channels, set up e-commerce teams and brought in more online distributors to significantly enlarge its share in the online market. The operation of double brands of “Little Swan” and “Midea” helped rapidly increase the market share of the “Midea” brand. As for export, the Company proactively coped with the big picture of an overall weak export market, proactively adjusted the product and customer structures, and vigorously pushed forward deepened strategic cooperation with customers from emerging markets. In some regions, the Company introduced its other brands as a way to improve profitability. As a result, in an unfavorable macro-environment, the Company managed to maintain relatively stable export.
3. Continued to input more in product innovation and upgrading
In 2013, the Company continued to input more to make its products more competitive. It enhanced study of the needs of consumers at home and abroad, and developed and launched a series of new products according to characteristics of different markets, which increased the competitiveness of its brands and products. For the domestic market, the Company launched high-end tumbling-box products of the “New Midea”, “Xinaishang” and “Chunzhen 2.0” series, as well as the brand-new whirlpool agitator series of “Midea 863”. For the overseas market, the “Water Magic Cube” and “One Button for All” series were launched. In 2013, the New Midea tumbling-box washer of the Company won the Independent Innovative Design Award in the 2013 Innovation Ceremony of China Industrial Design Awards, the Innovative Industrial Award in the Awards of China Household Appliance Innovation Achievements and the South Korea GD Awards. In addition, the Little Swan Chunzhen tumbling-box washer won the first prize in the China Industrial Design Taihu Awards. Meanwhile, the Xinaishang series of tumbling-box washers featuring green washing functions of fast washing and thorough cleaning received a lot of favorable comments after being launched.
II. Main business analysis
1. Overview
The Company is mainly engaged in washing machines. And this remained the same during the reporting period. Movements of revenue, cost, expense, etc. are as follows:
Unit: RMB Ten thousand
||||||
|-|-|-|-|-|
|Item|2013|2012|+/-|+/-%|
|Operating revenues|872,795.60|689,986.39|182,809.21|26.49%|
|Operating costs|654,962.19|533,991.46|120,970.73|22.65%|
|Period expense|168,520.93|116,889.50|51,631.43|44.17%|
|Operating profit|52,144.23|40,445.62|11,698.61|28.92%|
|Total profit|54,862.13|44,557.16|10,304.97|23.13%|
|Net profit attributable to theCompany (withoutsubsidiaries)|41,335.01|33,838.77|7,496.24|22.15%|

For reasons for items with a movement over30%, see “Section X Financial Report” - “XIV. Supplementary
2013 Annual Report of Wuxi Little Swan Company Limited Information– 3. Abnormalities of main items of the accounting statements and reasons therefor”.
Overview of the reporting period progress of development strategies and business plans disclosed in previous periods:
For the reporting period execution of the previously disclosed strategies and business plans, see this section– “I. Overview”– “(II) Review of major work”.
State the reasons why theCompany’s actual business performance is20% lower or higher than the earning forecast for the reporting period which has been publicly disclosed earlier:
□ Applicable√ Inapplicable
2. Revenues
The Company is mainly engaged in washing machines. For the reporting period, the Company achieved operating revenues of RMB 8.728 billion, up26.49% over last year.
Is theCompany’s goods selling revenue higher than the service revenue?
√ Yes□ No
Unit: Unit
||||||
|-|-|-|-|-|
|Industry|Item|2013|2012|YoY +/-%|
||Sales volume|9,142,664|7,656,657|19.41%|
|Household appliance|Output|9,054,490|7,795,785|16.15%|
||Stock|1,048,718|1,136,892|-7.76%|

 Reasons for anyover-30% YoY movement of the data above:
□ Applicable√ Inapplicable
Major orders on hand:
□ Applicable√ Inapplicable
Significant change or adjustment of theCompany’s products or services during the reporting period:
□ Applicable√ Inapplicable
Major customers:
|||
|-|-|
|Total sales to the top 5 customers (RMB Yuan)|2,306,194,921.56|
|Ratio of the total sales to the top 5 customers to the annual total sales (%)|26.42%|

 Information about the top 5 customers:
√ Applicable□ Inapplicable
|||||
|-|-|-|-|
|Serial No.|Name of customer|Sales (RMB Yuan)|Proportion in annual total sales (%)|
|1|Midea (Singapore) Trading Co., Ltd.|1,112,577,742.13|12.75%|
|2|Suning Commerce Group Co., Ltd|795,381,723.31|9.11%|
|3|Guizhou Midea Refrigeration Production Sales Co., Ltd.|162,915,012.10|1.87%|
|4|Beijing Jingdong Century Commerce Co., Ltd|118,037,791.26|1.35%|
||Kunming Midea Refrigeration Production Sales Co.,|||
|5||117,282,652.76|1.34%|
||Ltd.|||

2013 Annual Report of Wuxi Little Swan Company Limited
|||||
|-|-|-|-|
|Total|--|2,306,194,921.56|26.42%|

 3. Costs
Classified by industry:
Unit: RMB Yuan
||||||||
|-|-|-|-|-|-|-|
|||2013||2012|||
||||Proportion in||Proportion in||
|Industry|Item|||||YoY +/- (%)|
|||Amount|operating costs|Amount|operating costs||
||||（%）||（%）||
|Home appliance|||||||
||Raw materials|5,328,504,226.96|90.48%|4,062,553,588.78|86.12%|4.36%|
|manufacture|||||||
|Home appliance|||||||
||Labor cost|287,045,949.02|4.87%|221,156,333.64|4.69%|0.19%|
|manufacture|||||||
|Home appliance|Depreciation &||||||
|||159,123,532.24|2.70%|254,680,756.42|5.40%|-2.70%|
|manufacture|amortization||||||
|Home appliance|||||||
||Energy|47,221,210.21|0.80%|26,635,747.71|0.56%|0.24%|
|manufacture|||||||

Classified by product:
Unit: RMB Yuan
||||||||
|-|-|-|-|-|-|-|
|||2013||2012|||
||||Proportion in||Proportion in||
|Product|Item|||||YoY +/- (%)|
|||Amount|operating costs|Amount|operating costs||
||||（%）||（%）||
|Washing|||||||
||Raw materials|5,328,504,226.96|90.48%|4,062,553,588.78|86.12%|4.36%|
|machines|||||||
|Washing|||||||
||Labor cost|287,045,949.02|4.87%|221,156,333.64|4.69%|0.19%|
|machines|||||||
|Washing|Depreciation &||||||
|||159,123,532.24|2.70%|254,680,756.42|5.40%|-2.70%|
|machines|amortization||||||
|Washing|||||||
||Energy|47,221,210.21|0.80%|26,635,747.71|0.56%|0.24%|
|machines|||||||

Notes: 1. The proportion of raw materials increased because the business scale expanded, the proportion of fixed expenses decreased and the proportion of materials increased accordingly.
2. A new costitem—mouldamortization—was added to the cost items in the reporting period, and the relevant figures of last year were adjusted on the same basis.
Major suppliers:
2013 Annual Report of Wuxi Little Swan Company Limited
|||
|-|-|
|Total purchases from the top 5 suppliers （RMB Yuan）|1,136,927,538.81|
|Ratio of the total purchases from the top 5 suppliers to the annual total purchases（%）|18.9%|

 Information about the top 5 suppliers:
□ Applicable√ Inapplicable
4. Expense
Unit: RMB Yuan
|||||||
|-|-|-|-|-|-|
|Item|2013||2012||YoY +/-%|
|Selling expenses||1,267,118,417.20||840,560,482.53|50.75%|
|Administrative expenses||393,481,200.80||331,386,860.96|18.74%|
|Financial expenses||24,609,694.16||-3,052,363.24|906.25%|
|Income tax expenses||74,868,314.89||66,735,452.95|12.19%|

 5.R&D expenses
During the reporting period, with consumers as the center, the Company focused on building long-standing product competitiveness.R&D expenses were mainly used to: 1. carry out in-depth research on markets and consumers to work out more accurate plans and increase input on key projects; 2. vigorously improve product quality and enhance product design; and 3. keep introducing high-end talents. In 2013, variousR&D expenses stood at RMB 340 million, accounting for8.81% of theCompany’s audited net assets at the end of 2013 and3.95% of its operating revenues for the year.
6. Cash flows
Unit: RMB Yuan
|||||
|-|-|-|-|
|Item|2013|2012|YoY +/-（%）|
|Subtotal of cash inflows from operating|7,313,349,568.57|7,083,790,703.59||
||||3.24%|
|activities||||
|Subtotal of cash outflows from operating|6,408,467,467.56|6,739,033,005.44||
||||-4.91%|
|activities||||
|Net cash flows from operating activities|904,882,101.01|344,757,698.15|162.47%|
|Subtotal of cash inflows from investing|11,405,168,864.71|10,555,477,669.52||
||||8.05%|
|activities||||
|Subtotal of cash outflows from investing|11,854,317,350.44|11,754,098,980.68||
||||0.85%|
|activities||||
|Net cash flows from investing activities|-449,148,485.73|-1,198,621,311.16|62.53%|
|Subtotal of cash outflows from financing|189,716,383.08|132,586,903.59||
||||43.09%|
|activities||||

2013 Annual Report of Wuxi Little Swan Company Limited
|||||
|-|-|-|-|
|Net cash flows from financing activities|-189,716,383.08|-132,586,903.59|-43.09%|
|Net increase in cash and cash equivalents|265,078,649.53|-986,527,085.57|126.87%|

 Reasons for anyover-30% YoY movement of the data above:
√ Applicable□ Inapplicable
Net cash flows from operating activities increased mainly because the sales scale increased and cash received from sale of goods increased.
Net cash flows from investing activities increased mainly because the cash received from bank wealth management products increased.
Cash outflows from financing activities increased mainly because the cash dividends increased.
Reasons for a big difference between the operating cash flows and the net profit:
□ Applicable√ Inapplicable
2013 Annual Report of Wuxi Little Swan Company Limited III. Breakdown of main business
Unit: RMB Yuan
||||||||
|-|-|-|-|-|-|-|
|||||Increase/decrease||Increase/decrease|
||||||Increase/decrease||
||||Gross profit|of operating||of gross profit|
||Operating revenues|Operating costs|||of operating costs||
||||rate (%)|revenues over last||rate over last year|
||||||over last year (%)||
|||||year (%)||(%)|
|Classified by industry:|||||||
|Home appliance|||||||
||7,994,530,052.92|5,888,976,204.86|26.34%|29.71%|24.84%|2.88%|
|manufacture|||||||
|Classified by product:|||||||
|Washing|||||||
||7,994,530,052.92|5,888,976,204.86|26.34%|29.71%|24.84%|2.88%|
|machines|||||||
|Classified by region:|||||||
|China|6,322,627,813.03|4,343,498,573.35|31.3%|53.03%|55.92%|-1.28%|
|Other countries|1,671,902,239.89|1,545,477,631.51|7.56%|-17.7%|-19.98%|2.63%|

 Where theCompany’s accounting standard of the main business data above changed during the reporting period, give the main business data of the latest year adjusted according to the accounting standard at the end of the reporting period:
□ Applicable√ Inapplicable
IV. Asset and liability analysis
1. Major changes of asset items
Unit: RMB Yuan
||||||||
|-|-|-|-|-|-|-|
||As at 31 Dec. 2013||As at 31 Dec. 2012||||
|||Proportion in||Proportion in|Proportion|Explain any|
||Amount|total assets|Amount|total assets|change（%）|major change|
|||(%)||(%)|||
|Monetary funds|1,617,373,088.50|17.54%|1,404,291,094.65|16.71%|0.83%||
|Accounts|777,744,132.32||722,198,904.66||||
|||8.43%||8.59%|-0.16%||
|receivable|||||||
|Inventories|798,141,838.58|8.65%|952,747,860.68|11.34%|-2.69%||
|Investing real|9,466,777.10||5,049,500.73||||
|||0.10%||0.06%|0.04%||
|estate|||||||
|Long-term equity|4,579,148.88||5,695,850.80||||
|||0.05%||0.07%|-0.02%||
|investment|||||||

2013 Annual Report of Wuxi Little Swan Company Limited
|||||||
|-|-|-|-|-|-|
|Fixed assets|1,194,244,286.86|12.95%|1,297,298,526.31|15.44%|-2.49%|

2. Assets and liabilities measured at fair value
Unit: RMB Yuan
|||||||||
|-|-|-|-|-|-|-|-|
||||||Purchase|||
|||||||Sold||
|||Gain/loss on fair|Cumulative fair|Impairment|d|||
|||||||amount||
|||value change in|value change|provisions in|amount|||
|Item|Opening amount|||||in the|Closing amount|
|||the reporting|recorded into|the reporting|in the|||
|||||||reportin||
|||period|equity|period|reportin|||
|||||||g period||
||||||g period|||
|Financial assets||||||||
|1. Derivative financial|1,224,590.00|13,792,150.00|||||15,016,740.00|
|assets||||||||
|2. Available-for-sale|286,944.00|25,872.00|180,638.60||||312,816.00|
|financial assets||||||||
|Subtotal of financial|1,511,534.00|13,818,022.00|180,638.60||||15,329,556.00|
|assets||||||||
|Total of the above|1,511,534.00|13,818,022.00|180,638.60||||15,329,556.00|

 Did any significant change occur to the attribute of theCompany’s main asset measurement during the reporting period?
□ Yes√ No
V. Core competitiveness analysis
The Company is one of the biggest washing machine manufacturers in China, with its main competitiveness as follows:
1. Technology-related competitiveness: The Company has been concentrating on its washing machine business all the time. Through constant input ofR&D resources over the years, the Company has owned leading technological competitiveness in the industry. The Company has a sound technologicalR&D system, including one state-level technological center and two state-recognized labs. Little Swan Lab is the first washing machine lab in China to pass the UL North American safety verification and the German VDE verification. Little Swan holds on to independent innovation and has the internationally advanced frequency-changing, intelligent control, structure design, industrial design and other core washing technologies.
2. Brand-related competitiveness: The Company adopts a two-brand strategy (“Little Swan” and “Midea”). As a washer brand with a history over 30 years, Little Swan is considered a very reliable brand among consumers, with the slogan of “Whole-hearted Little Swan” being well-known among them. As for Midea, it is a well-known home appliance brand, which is also of a high reputation as a washer brand, and its market share keeps rising.
3. Scale-related competitiveness: The Company is one of the first washer manufacturers in China and it has
established the lean manufacturing culture. It now has domestically and internationally first-class manufacturing
equipments and an experienced manufacturing team. The Company has now three productionbases—Wuxi, Hefei
and Jingzhou, with the combined production capacity over 16 million units. Its wide product range covers
2013 Annual Report of Wuxi Little Swan Company Limited tumbling-box, whirlpool agitator full-automatic, double-cylinder and agitator washing machines, clothes dryers, etc., creating incomparable scale competitiveness among washer manufacturers.
4. Channel-related competitiveness: Through reform and adjustment in the recent years, the Company has formed its channel competitiveness. In the domestic first and secondary markets, the Company mainly works with Suning, Gome and some other big regional customers. In the tertiary and fourth markets, the Company combines traditional channels and franchised stores to distribute its products to households. In the overseas markets, the Company keeps deepening its cooperation with customers and the overseas markets keep expanding. With a good and long-term cooperation with all major customers, the Company enjoys good brand loyalty.
No significant change occurred to the core competitiveness of the Company in the reporting period.
VI. Investment analysis
1. Investments in equities of external parties
(1) Equity-holdings in financial enterprises
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
||Enterprise|||Opening||Closing||Gain/loss in||Equit|
|||Initial|Opening||Closing||Closing book||Accou||
|Enterprise|||||||||||
|||||equity-h||equity-hol||the reporting||y|
|||investment cost|equity-hold||equity-holdi||value (RMB||nting||
|name|variet|||olding||ding ratio||period||sourc|
|||(RMB Yuan)|ings (share)||ngs (share)||Yuan)||title||
||y|||ratio (%)||(%)||(RMB Yuan)||e|
||||||||||Long-t||
|Jiangsu|Com|||||||||Privat|
||||||||||erm||
|Commerci|merci|1,100,000.00|2,202,564|0%|2,202,564|0%|1,210,000.00|123,405.12||e|
||||||||||equity||
|al Bank|al|||||||||offeri|
||||||||||invest||
|Ltd., Co.|bank|||||||||ng|
||||||||||ment||
|Total||1,100,000.00|2,202,564|--|2,202,564|--|1,210,000.00|123,405.12|--|--|

 2. Wealth management entrustment, derivative investments and entrustment loans
(1) Wealth management entrustment
Unit: RMB Ten Thousand Yuan
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
|||Rela|||||||||Amount|
||Relat|ted-|||||||||of the|
||||||||||Impair|||
|||part||||||Principal||Anticipat|actual|
|Name oftrustee|ed-pa||Type of||Beginning|Ending|Payment|||||
|||y||Amount|||||ment||gains and|
||rty|||||||actually||ed||
|||trans|products||date|date|determination||provisi||losses|
||relati|||||||recovered||income||
|||actio|||||||on||during the|
||on|||||||||||
|||n or|||||||||reporting|
|||not|||||||||period|
||||||||Floating interest|||||
||||Bank|||||||||
||||||1 Jan.|31 Dec.||||||
|Bank|No|No||1,179,479|||rate and the|1,118,673||9,756|9,756|
||||financial|||||||||
||||||2013|2013|contract gave|||||
||||products|||||||||
||||||||the highest|||||

2013 Annual Report of Wuxi Little Swan Company Limited
|||||||||
|-|-|-|-|-|-|-|-|
|||||annualized rate||||
|||||of return||||
|Total|1,179,479|--|--|--|1,118,673|9,756|9,756|
||All is from the self-owned funds of the Company. The entrusted funds are cumulative. The line for|||||||
|Source of the entrusted funds||||||||
||wealth management entrustment is RMB 1.8 billion and repeated use is allowed within the said|||||||
||line.|||||||
|Cumulative overdue principals||||||||
||0|||||||
|and gains||||||||
|Disclosure date of the Board fDirectors’ announcementapproving the wealthmanagement entrustment (ifany)||||||||
||6 March 2013|||||||
|Disclosure date of the Board fShareholders’ announcementapproving the wealthmanagement entrustment (ifany)||||||||

2013 Annual Report of Wuxi Little Swan Company Limited (2) Derivative investments
Unit: RMB Ten Thousand Yuan
||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|
||||||||||||Proportio||
||||||||||||n of the||
|||Relate|||||||||||
||||||||||||closing|Actual|
||||||||||Impairme||||
|||d-part|Type of||Initial|||Opening||Closing|investmen||
||Relat|||||Beginning||||||gain/loss|
|Operator||y|||||Ending date||nt||t amount||
||||derivative||investment|||investmen||investmen||in|
||ion|transac||||date|||provision||in the||
||||investment||amount|||t amount||t amount||reporting|
|||tion or|||||||(if any)||Company||
|||||||||||||period|
|||not|||||||||’s closing||
||||||||||||net assets||
||||||||||||(%)||
||||Forward||||||||||
|Bank|No|No|||24,245|10 Jan. 2013|7 Jan. 2015|24,245||48,371|10.67%|1,893|
||||exchange||||||||||
||||contract||||||||||
|Total||||24,245||--|--|24,245||48,371|10.67%|1,893|
|Capital source for derivative|||||||||||||
|||||All self-owned funds|||||||||
|investment|||||||||||||
|Disclosure date of the boardannouncement approving thewealth managemententrustment (if any)||||3 Nov. 2012|||||||||
|||||6 Aug. 2013|||||||||
|Disclosure date of the generalmeeting announcementapproving the wealthmanagement entrustment (ifany)||||21 Nov. 2012|||||||||
|||||28 Aug. 2013|||||||||
|||||The Company has formulated the Management Methods for Futures Hedging Business and the|||||||||
|||||Management Methods for Exchange Funds upon review to thoroughly assess and control derivative|||||||||
|||||investment risks, which are detailed as follows:|||||||||
|Analysis on risks and control|||||||||||||
|||||1. Market risk|||||||||
|measures of derivative|||||||||||||
|||||Price movements of bulk raw materials and fluctuations of exchange rates may incur a great market|||||||||
|products held in the reporting|||||||||||||
|period (including but not|||||||||||||
|||||risk in the futures business and the foreign exchange funds business. Meanwhile, if the Company|||||||||
|limited to market risk,|||||||||||||
|||||fails to input enough funds in time to create and maintain hedging positions in its futures hedging|||||||||
|liquidity risk, credit risk,|||||||||||||
|||||operations, or fails to input foreign exchanges on time for contract execution in the foreign|||||||||
|operation risk, law risk, etc.)|||||||||||||
|||||exchange funds business, hedging loss and contract breach risk may incur.|||||||||
|||||Counter-measures: The Company will not carry out speculative trading in its futures hedging|||||||||
|||||business and foreign exchange funds business. And the Company will stick to the principle of being|||||||||

2013 Annual Report of Wuxi Little Swan Company Limited
|||
|-|-|
||prudent in operations. As for the futures hedging business, the hedging volume should be|
||determined and futures trading applications should be filed in strict accordance with production and|
||operation needs. In principle, the hedging volume shall not exceed one third of the planned volume|
||for the year. And a stop-loss mechanism is adopted. Guarantee deposits are paid as required and|
||increased according to production and operation needs. As for the foreign exchange funds business,|
||a from-the-bottom-up management mechanism is adopted. When subsidiaries or product enterprises|
||file applications for funds business, they will give a risk analysis on conditions or circumstances|
||that might affect gains and losses, estimate the maximum gain and loss, and state the ratio or total|
||amount of guarantee deposits they can bear. And the Company will, according to their applications,|
||update operations in time in its funds business and make funds arrangements before the maturity|
||date.|
||2. Operation risk|
||The Company may suffer loss in its hedging business and foreign exchange funds business due to|
||faulty internal procedures, staff, systems and external events.|
||Counter-measures: Responsibility division and approval procedures for the hedging and foreign|
||exchange business have been specified in relevant management rules. And a sound supervision|
||mechanism has been established. And operation risk can be effectively reduced by enhancing risk|
||control over procedures for operation, decision-making and trading.|
||3. Risk concerning laws and regulations|
||The Company carries out its hedging and foreign exchange business in compliance with applicable|
||laws and regulations, with rights and duties between the Company and agencies being stated clearly.|
||Counter-measures: The Company urges responsible departments to understand better about relevant|
||laws, regulations and market rules; be strict in contract re-checks; make clear relevant rights and|
||duties; and enhance compliance checks to make sure that the Company operates derivative|
||investments in compliance with applicable laws, regulations and the Company’s internal|
||management rules.|
|Changes of market prices or||
|fair values in the reporting||
|period of the invested||
||The Company adopts public quotations in the futures market or forward foreign exchange|
|derivatives. And the analysis||
|on the fair value of the|quotations declared by the People’s Bank of China in its analysis on fair values of derivative|
|derivatives should include the|products.|
|specific use methods and the||
|relevant assumptions and||
|parameters.||
|Whether significant changes||
|occurred to the Company’s||
||No significant changes.|
|accounting policy and specific||
|accounting principles of||
|derivatives in the reporting||

2013 Annual Report of Wuxi Little Swan Company Limited
|||
|-|-|
|period compared to the||
|previous reporting period||
||Independent directors of the Company believe that: A. The Company has formulated derivative|
||investment rules such as the Management Methods for Futures Hedging Business and the|
||Management Methods for Exchange Funds to help it effectively control risks involved; B. During|
|Specific opinion from|the reporting period, the Company performed the relevant approval procedure before it conducted|
||derivative investments in strict compliance with the lines and ways approved by the Shareholders’|
|independent directors on the||
||General Meeting; And C. The Company’s derivative investments in the reporting period mainly|
|Company’s derivatives||
||targeted its exports. It signed forward exchange contracts with domestic financial institutions, which|
|investment and risk control||
||helped it lock up the exchange rate and avoid the risk of exchange rate fluctuations. The Company|
||conducted no speculative operations, so there was no credit risk. And transaction periods were|
||determined according to expectations and payment receiving and making, with no influence on the|
||Company’s fluidity.|

3. Analysis to main subsidiaries and stock-participating companies
Main subsidiaries and stock-participating companies:
Unit: RMB Ten Thousand Yuan
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
||||Main|||||||
||Compan|Industr||Registered|||Operating|Operating||
|Company name|||||Total assets|Net assets|||Net profit|
||||products/servi|||||||
||y variety|y||capital|||revenues|profit||
||||ces|||||||
|Hefei Midea|||washing|||||||
||Subsidia|Manuf||USD||||||
||||||374,603.14|165,917.67|390,739.88|15,777.32|14,941.96|
|Washing Machine|||machine|||||||
||ry|acture||13552||||||
|Co., Ltd.|||manufacture|||||||
|Wuxi Little Swan||||||||||
||Subsidia|Manuf|Washer-dryer|||||||
|||||2800|22,756.31|15,363.76|19457.38|258.39|301.82|
|General Electrical||||||||||
||ry|acture|manufacture|||||||
|Appliances Co., Ltd||||||||||
||||Development|||||||
||||and|||||||
|Wuxi FILIN|Subsidia|Manuf||USD||||||
||||manufacture||38,161.46|27,935.58|29,015.53|5,349.59|5,199.71|
|Electronics Co., Ltd|ry|acture|of new|362.46||||||
||||electronic|||||||
||||components|||||||
|Little Swan||||||||||
||||Washing|||||||
||Subsidia|Manuf||||||||
|(Jingzhou) Sanjin||||1107||||||
||||machine|||||||
|Electric Appliances|ry|acture|||11,735.91|3,242.00|28,996.77|830.74|658.91|
||||manufacture|||||||
|Co., Ltd.||||||||||

Explain particulars about main subsidiaries and stock-participating companies:
Notes: During the reporting period, thesubsidiary—Hefei Royalstar Washing Equipment Manufacturing Co., Ltd.
renamed as Hefei Midea Washing Machine Co., Ltd..
2013 Annual Report of Wuxi Little Swan Company Limited Subsidiaries acquired or disposed during the reporting period:
√ Applicable□ Inapplicable
During the reporting period, the Company had disbanded and canceled its subsidiary--Wuxi Little Swan drive and control technology development Co., Ltd. See details of the progress of the disposal of other subsidiaries on the XI: Events after the balance sheet date in Section X: Financial report.
2013 Annual Report of Wuxi Little Swan Company Limited 4. Significant projects of investments with non-raised funds
Unit: RMB Ten Thousand Yuan
|||||||
|-|-|-|-|-|-|
||Total|Input for this|Cumulative actual input as at|||
|Project name||||Project progress|Project earnings|
||investment|period|the period-end|||
|Investment plans of the||||||
||||||Immeasurable|
|Company and its|64,870|0|19,911|30%||
|subsidiaries for 2011|||||separately|
|(Notes 1)||||||
|Total|64,870|0|19,911|--|--|
|Date when the relevant interim||||||
|||18 March 2011||||
|announcement was disclosed on the||||||
|designated website||||||
|Index when the relevant interim||||||
|||Investment Plan Announcement of 2011 of Wuxi Little Swan Co., Ltd. (No.: 2011-12),||||
|announcement was disclosed on the||||||
|||or see details on http://www.cninfo.com.cn.||||
|designated website||||||

Note 1: In the year-begin of 2011, in regards of market demand growth forecast and tightening production capacity at that time, the Company, based on company decision, planned to invest RMB 648.7 million to enlarge the production capacity of Jinzhou Base and other base. During the implementation process, the market changed a lot with decreased whole demand and slower industry growth. According to market changes, the Company adjusted investment plans in time, and non-invested projects in investment plans of the Company and subsidiaries in 2011 have been terminated.
VII. Predict the operating results of Jan.-Mar. 2014
Warning of possible loss or considerable YoY change of the accumulated net profit made during the period-begin to the end of the next reporting period according to prediction, as well as explanations on the reasons:
□ Applicable√ Inapplicable
VIII. Outlook of theCompany’s future development
(I) Industry development trend
In 2014, after withdrawal of the Consumption Stimulus Policies, the household appliance industry will return to market-oriented operation, and the washing machines will recover to the stable adjusted stage from the rapid development a few years ago. Product upgrading, technological innovation and efficiency increase will become the main development means of the sustainable development in the washing machine industry. The execution of
the new energy efficiency standards will boost the further acceleration of the optimization and integration of the
whole industry. The intelligent home appliances as well as the application of the mobile internet will gain
increasing attention. The development of the online sales and the urbanization progress will bring new market
2013 Annual Report of Wuxi Little Swan Company Limited opportunities for the industry. Meanwhile, the regulation of the real estate market and the upheaval of the international political situation will also bring uncertainties to the whole industry.
(II) Development plan of the Company
In 2014, the Company will continue to insist the professional operation, and will center on the corebusiness—the washing machine business, to make further transformation, and center on the twocores—the enhancing of the product power as well as the enhancing of the operation efficiency, to regard the consumers as the center, thus to continuously improve the competitiveness of the products; to strengthen its competitiveness in the markets at home and abroad; to intensify the execution of the performance-oriented mechanism and improve the organizational operation efficiency.
1. Regard the consumers as the center and make good products
As the improvement of the resident income as well as the up-gradation of the consumption concept, the consumers become more focus on the product performance and the consumption experience. The changes of the consumption awareness as well as the consumption behaviors request the washing machine to develop more high-end oriented and qualifier oriented, and the intellectualization, green and environmental protection as well as the high capacity is becoming the development tendency of the washing machine. In 2014, the Company will enhance the cooperation investment with the professional assessment and research firms, and to push the professionalization of the market and the user research. To construct the new platform based on the consumers research, and to build up and operate an open innovated system, to enlarge the research of the basic skills and the appliance research of the efficiency, the noise skills and the internet skills, to further push the standardization work, so thus to make the products well.
2. Strengthen the rigid quality, and create the touching quality
No product, no user, and no quality, no market. In 2014, the Company will continue to strengthen the rigid quality and effectively implement the one-vote veto; to intensify the quality controlling of two source (procurement and design), one process (manufacturing), and the quality index will be involved in the performance index of the responsible persons of each department and the execution of the rigid examine. To enhance the threshold of the suppliers introduction, and to forced out the inferior supplier. In 2014, the Company will based on the invested 160 million to invest for another funds not less than 100 million, which will continuously push the improvement of the quality as well as make efforts to create the touching quality.
3. Insist on the double brands operation and guarantee the balanced improvement of scale and profits.
In 2014, the Company will insist to carry out the two brand operation system of the Little Swan and the Midea. These two brands both own the relatively stable clients, and have certain differences as well as complement. The Company will focus on the position of these two brands to make definite market segmentation according to their appearance design, the function and the prices. The Little Swan positions in high-end and professional and devotes to creating more perfect washing experience, and it is the high-end washing machine brands as industry leader. And the Midea positions in fashion, and its perfect integration of the innovated technology and the humanization design gains the highly reorganization of the market. In 2014, the Company will reasonable layout, thus to push the washing machine of the Little Swan and the Midea to develop continuously as well as stable, and
2013 Annual Report of Wuxi Little Swan Company Limited to realize the balanced improvement of the scale and the profits.
4. Enlarge the investment of the e-commerce channels and to proactively embrace the opportunities and the challenges.
According to the results of the Survey on the Online Shopping Needs of the Washing Machine of the China Netizen which was co-sponsored by the State Grid Corporation of China and the AVC, there were73.2% of the netizens will buy the washing machine online. Under the internet environment, we should really regard the consumers as the center, so thus to offer better shopping experience for the consumers. As the rapid development of the electrical business channels, its percentage of the sales volume was arising by year, and the online and offline interactive sales was becoming an emerging trends of the home appliance channel, which was also the new opportunity as well as the challenge facing upon the Company. In 2013, the electric business of the Company grew rather quickly that gained a more substantial growth. In 2014, the Company will continue to be stronger based on the year of 2013, and to set up an independent management center of electric business, and to carry out the distribution of resource and the professional operation according to the product planning, organization and team construction, promotion planning and process optimization. In 2014, the Company will continue to consolidate and strengthen the cooperation of each electric business platform, to improve the online sales structure, so thus to ensure the online business of the Company could match the industry status.
(III) Future risk analysis
1. Market risks: The uncertain domestic real estate market and unrest in the overseas political environment have brought uncertainty to market demand. Meanwhile, the rise and rapid development of e-commerce poses challenges to traditional marketing modes.
2. Cost risks: In 2013, the prices of bulk raw materials remained relatively low. If they go to a much higher level in 2014, theCompany’s profitability will be directly affected. Along with the rise of labor cost, cost pressure on the Company will build up.
3. Exchange rate risks: The fluctuation in exchange rate is very much uncertain. Though the Company has adopted certain counter measures against exchange rate fluctuation, the Company would still be largely affected in profitability of overseas sales by fluctuated exchange rate.
4. Policy risks: In overseas market, the promotion of non-tariff trade barriers and possible anti-dumping policy would affect the scale and profitability of theCompany’s overseas business.
IX. Explanation by the Board of Directors and the Supervisory Committee about the “non-standard audit report” issued by the CPAs firm for the reporting period
N/A
X. Explanation of the changes of the accounting policy, the accounting estimates and the accounting methods compared to the last financial report
N/A
2013 Annual Report of Wuxi Little Swan Company Limited XI. Explanation of the significant accounting correction of errors that needed to make retroactive statement during the reporting period
N/A
XII. Explanation of the changes of the consolidated statement scale compared to the last financial report
One entity was deconsolidated for the current year as compared with last year. Subsidiary Wuxi Little Swan Drive& Control Technology Development Co., Ltd. dissolved and canceled its registration. It has thus been excluded from the consolidated financial statement scope since 17 Dec. 2013.
XIII. Profit allocation and dividend payout
Formulation, execution or adjustment of theCompany’s profit allocation policy, especially the cash dividend policy, during the reporting period:
□ Applicable√ Inapplicable
TheCompany’s preplans or plans for profit allocation and turning capital reserve into share capital for the recent three years (including the reporting year):
Profit distribution plan for 2011: Based on the total 632,487,764 shares of the Company as at the end of 2011, a cash dividend of RMB 2.00 (tax included) was distributed for every 10 shares and no capital reserve was turned into share capital. The plan was fully carried out in Jun. 2012.
Profit distribution plan for 2012: Based on the total 632,487,764 shares of the Company as at the end of 2012, a cash dividend of RMB 3.00 (tax included) was distributed for every 10 shares and no capital reserve was turned into share capital. The plan was fully carried out in Jun. 2013.
Profit distribution plan for 2013: Based on the total 632,487,764 shares of the Company as at the end of 2013, a cash dividend of RMB 3.00 (tax included) was distributed for every 10 shares and no capital reserve was turned into share capital. After the deliberation of the Board of Directors, it would be handed in to be examined by the Board of Shareholders.
Cash dividend distribution of the Company over the recent three years:
Unit: RMB Yuan
|||||
|-|-|-|-|
|||Net profit attributable to||
||||Ratio in net profit attributable to|
|||shareholders of listed||
||Amount of cash dividend||shareholders of listed|
|Year||companies under the||
||(tax included)||companies under the|
|||consolidated statement in the||
||||consolidated statement (%)|
|||year||
|2013|189,746,329.20|413,350,079.54|45.90%|
|2012|189,746,329.20|338,387,680.99|56.07%|

2013 Annual Report of Wuxi Little Swan Company Limited
|||||
|-|-|-|-|
|2011|126,497,552.80|453,327,963.81|27.90%|

 The Company (including its subsidiaries) made profit in the reporting period and the retained profit of the Company (without subsidiaries) was positive, but it did not put forward a preplan for cash dividend distribution:□ Applicable√ Inapplicable
XIV. Pre-plan for profit allocation and turning capital reserve into share capital for the reporting period
|||
|-|-|
||0|
|Bonus shares for every 10 shares (share)||
|Dividend for every 10 shares (RMB Yuan) (tax|3.00|
|included)||
|Total shares as the basis for the allocation preplan||
||632,487,764|
|(share)||
||189,746,329.20|
|Total cash dividends (RMB Yuan) (tax included)||
||1,912,838,272.63|
|Distributable profit (RMB Yuan)||
|Percentage of the cash bonus of the total profits||
||100%|
|dividends (%)||
|Cash dividend policy:||
|Other||
|Details about the profit allocation or turning capital reserve into share capital||
|According to the Audit Report provided by the Jiangsu Gongzheng Tianye Certified Public Accountants LLP, the parent company||
|realized the net profit of RMB 203,411,195.64 in 2013, and if plus the undistributed profit of the last year-begin of the amount of||
|RMB 1,709,427,076.99, the distributable profit would be of RMB 1,912,838,272.63; the statutory reserved funds was of RMB||
|20,341,119.56, the distributed dividend of 2012 was of RMB 189,746,329.20, and the distributable profits for the shareholders of||
|the end of the reporting period was of RMB 1,702,750,823.87.||
|Rre-plan of the distribution of 2013: Based on the total 632,487,764 shares of the Company as at the end of 2013, a cash dividend||
|of RMB 3.00 (tax included) was distributed for every 10 shares to the whole shareholders, which come to the total cash amount of||
|RMB 189,746,329.20, and the remain undistributed profits will carry forward to the consequent years. No capital reserve was||
|turned into share capital in 2013.||

XV. Social responsibilities
(I) Safeguarding legitimate rights and interests of consumers: Being market-oriented, the Company pays attention tocustomers’ needs and keeps improving quality management to offer products with a quality higher than the expectation of consumers. It has a national servicehotline—4008228228—to answer tocustomers’ questions and complaints, ensure that they would be satisfied.
(II) Safeguarding rights and interests of employees: The Company strictly implemented the state laws and
regulations to positively guarantee the legal interests of the staff. The Company offered a favorable working and
living environment for its staff and built as well as improved the salary standard and the incentive system, and
2013 Annual Report of Wuxi Little Swan Company Limited provided competitive salary reward with improving space. It also conducts many leisure activities to enrichemployees’ life. Aimed at the actual demands of the staff on different position, the Company offered various kinds of training to promote the career development of the staff by the method combined either in internal or external.
(III) Promoting energy saving and environmental protection: The Company carried out and promoted the energy conservation and emission reduction and executed the social responsibility under the low-carbon time through innovation in management, system, technology and products. During the progress of produce, the Company strengthened the measures of the energy conservation and emission reduction, thus realized100% of the recycle and the reuse of the industrial water consumption; the Company successfully explored the Accurate Automatic Launch Detergent Technology, which gained the authentication of the international authority-UK Intertek, and at the same time received the green leave label of Carbon Footprint that meant the Company be the first enterprise that received that label in the domestic washing machine industry.
(IV) Caring for the vulnerable groups: Both in the activity of the Happy Life Promotion Plan of the Disabled In Jiangsu on the National Disabled Day in May and the Charity Donation Day in Dec., the Company had positively made donates, which demonstrated its social responsibility by actual behaviors.
Does the listed company or its subsidiaries belong to the heavily polluting industries stipulated by the environmental protection authorities of the country?
□ Yes√ No
Does the listed company or its subsidiaries have any other significant social security problems?
□ Yes√ No
Any administrative punishment during the reporting period?
□ Yes√ No
XVI. Particulars about researches, visits and interviews received in this reporting period
|||||||
|-|-|-|-|-|-|
||||||Main discussion and|
||Place of|Way of|Visitor|||
|Time of reception||||Visitor|materials provided by|
||reception|reception|type|||
||||||the Company|
||Conference|||||
|||Field||Changjiang Securities, SWS Mu Fund|Overall operation of|
|8 Jan. 2013|Room of the||Institution|||
|||research||||
|||||Management, China Post Fund, Hua’an Funds|the Company|
||Company|||||
|||||China Merchants Securities, Eastern Bay Asset||
||Conference|||||
|||Field||Management, Ping An Insurance, New Think|Overall operation of|
|14 Jan. 2013|Room of the||Institution|||
|||||Invest, BNY Fund, Western Asset Management,||
|||research||||
||||||the Company|
||Company|||Haitong Securities, Wanjia Asset, Aijian||
|||||Securities||
|||||Changjiang Securities, Broad Capital, Nanjing||
||Conference|||||
|||Field|||Overall operation of|
|13 Aug. 2013|Room of the||Institution|Securities, Orient Securities Asset Management,||
|||research||||
|||||PICC Asset Management, Zhonghai Fund, CPIC,|the Company|
||Company|||||
|||||China Post Fund, Soochow Securities, Everbright||

2013 Annual Report of Wuxi Little Swan Company Limited
|||||||
|-|-|-|-|-|-|
|||||Securities Asset Management, China Life||
|||||Insurance Asset Management, Hua’an Funds,||
|||||Wanjia Asset, J-high Investment, Fullgoal Fund,||
|||||Dacheng Fund, Shanghai Congrong Investment,||
|||||Shanghai Elegant Investment||
||Conference|||||
|||Field|||Overall operation of|
|6 Sep. 2013|Room of the||Institution|Morgan Stanley||
|||research||||
||||||the Company|
||Company|||||
||Conference|||||
|||Field|||Overall operation of|
|12 Sep. 2013|Room of the||Institution|Bohai Securities||
|||research||||
||||||the Company|
||Company|||||
||Conference|||||
|||Field|||Overall operation of|
|14 Nov. 2013|Room of the||Institution|Galaxy Securities, Rongtong Fund||
|||research||||
||||||the Company|
||Company|||||
||Conference|||||
|||Field||Changjiang Securities, China Universal Asset|Overall operation of|
|15 Nov. 2013|Room of the||Institution|||
|||research||||
|||||Management|the Company|
||Company|||||

2013 Annual Report of Wuxi Little Swan Company Limited Section V. Significant Events
I. Significant lawsuit or arbitration
□ Applicable√ Inapplicable
There was no significant lawsuit or arbitration during the reporting period.
II.Media’s doubts
□ Applicable√ Inapplicable
There was no such a case in the reporting period where most of the media raised the same doubt about the Company.
III. Asset transactions
1. Sale of assets
|||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
|||||Net||||||||||
||||||||||Relation|||||
|||||profit|||||||Whether|||
||||||||||ship|||||
|||||contribu||Ratio of||||Whether|or not|||
||||||||||between|||||
|||||ted to||the net||||or not|the|||
||||||||||the|||||
|||||the||profit||||the|creditor’|||
||||||||||transacti|||||
|||||Compan||contribu||||ownersh|s right|||
||||||Impact|||Related-|on party|||||
|||||y from||ted by||||ip of the|and|||
|Transact|||Transact||to the||Pricing|party|and the||||Disclos|
||Assets|Disposa||the||the asset||||asset|liabilitie|Disclos||
|ion|||ion||compan||principl|transacti|Compan||||ure|
||sold|l date||period-b||to the||||involve|s|ure date||
|party|||price||y(Notes||e|on or|y||||index|
|||||egin to||Compan||||d has|involve|||
||||||3)|||not|(applica|||||
|||||the||y to the||||been|d have|||
||||||||||ble for|||||
|||||disposal||total||||fully|been|||
||||||||||related-|||||
|||||date(R||profit||||transferr|fully|||
||||||||||party|||||
|||||MB Ten||(%))||||ed|transferr|||
||||||||||transacti|||||
|||||thousan|||||||ed|||
||||||||||ons)|||||
|||||d)||||||||||
||Equities||||||Negotiat|||||||
|Jiangsu||||||||||||||
||of||||||ed|||||||
|kunpeng||||||||||||||
||Hengtai||||||accordin|||||||
|investm||5 Jan.|||||||Inapplic||||Inapplic|
||insuranc||100|0|0|0%|g to the|No||Yes|Yes|||
|ent co.,|||||||||able||||able|
|||2013||||||||||||
|LTD|e||||||compan|||||||
||brokers||||||y's net|||||||
||co., Ltd.||||||assets|||||||
||||||||Confirm|||||||
|Midea|Equities|23 Dec.|||Inapplic||||Compan||||Inapplic|
||||881.03|12.34||0%||Yes||No|No|||
||||||||ed|||||||
|Group|of the|2013|||able||||y||||able|
||||||||accordin|||||||

2013 Annual Report of Wuxi Little Swan Company Limited
|||||
|-|-|-|-|
|Finance|Jiangsu|g to the|controll|
|Co.,|Comme|market|ed by|
|Ltd.|rcial|price of|the|
||Bank|similar|controlli|
|||assets|ng|
||||sharehol|
||||der|

IV. Implementation of equity incentive and its influence
Inapplicable
V. Significant related-party transactions
1. Credits and liabilities with related parties
Was there any credit or liability with any related party for non-operating purpose?
□ Yes√ No
2. Other significant related-party transactions
(1) The Company convened the
1st
SpecialShareholder’s General Meeting on 27 Aug. 2013, which reviewed and approved the proposals on:
① The Proposal on the Announcement about the Financial Service Agreement which signed with the Midea Group Finance Co., Ltd., Ltd. of related transaction
It was agreed that, the financial company should provide the service of deposit, loan, note discount, guarantee, settlement, and the series of the financial services that approved by the CBRC according to the requirements of the Company as well as its subsidiaries. During the three-year validity after date of the validation of the agreement, the maximum of the deposit balance that the Company and its subsidiaries disposed in the financial company should not exceed the amount of RMB 1 billion per day; and the maximum of the outstanding loan principal and interest balance that the financial company granted to the Company and its subsidiaries should not exceed the amount of RMB 1 billion per day.
② The Proposal on the Announcements about trademark license of related transactions
The Company permitted GD Midea Holding Co., Ltd and its controlled subsidiaries to use trademark of LITTLE SWAN and picture in air conditioner commodities; permitted Hubei Midea Refrigerator Co., Ltd. and its controlled subsidiaries to use to use trademark of LITTLE SWAN and picture in the refrigerators and the freezers; at the same time GD Midea Holding Co., Ltd permitted the Company and subsidiaries of the Company to use trademark of Midea in production, sales and ad campaign of washing machines and dryers. The aforesaid licensing contracts were all contracted with0.3% charges of net sales revenue of products with the authorized
trademark as trademark license fees, and the permitting period last from the 1 Jan. 2014 to 31 Dec. 2016.
(2) The 2012 AnnualShareholder’s General Meeting was convened on 12 Apr. 2013, at which reviewed and
approved the Proposal on Prediction of the Line of Routine Related Transaction of the Company for 2013.
2013 Annual Report of Wuxi Little Swan Company Limited See details of its specific contents and the corresponding of the associations of the related debts in X. Financial Report: VIII. Related parties and related party transactions.
Index for the interim announcements on significant related-party transactions disclosed on the relevant website:
||||
|-|-|-|
|Title of the interim announcement|Disclosure date|Disclosure website|
|Announcements about estimating the 2013 dailyconnection transaction amount (NO.2013-03)|||
||6 Mar. 2013||
|||www.cninfo.com.cn|
|Announcement about the Financial Service Agreementwhich signed with the Midea Group Finance Co., Ltd. ofrelated transaction(NO. 2013-17)|||
||6 Aug. 2013||
|||www.cninfo.com.cn|
|Announcements about trademark license of relatedtransactions(NO.2013-18)|||
||6 Aug. 2013||
|||www.cninfo.com.cn|

VI. Significant contracts and their execution
1. Trusteeship, contracting and leasing
（1）Trusteeship
Particulars about trusteeship:
During the reporting period, there were no major events where the Company trusted other companies with anything or vice versa. Nor there were such events that occurred in previous periods but lasted to the reporting period.
Any trusteeship event with anover-10% influence on the total profit of the Company for the reporting period:□ Applicable√ Inapplicable
（2）Contracting
Particulars about contracting:
During the reporting period, there were no major events where the Company served as a contractor for other companies or vice versa. Nor there were such events that occurred in previous periods but lasted to the reporting period.
Any contracting event with anover-10% influence on the total profit of the Company for the reporting period:□ Applicable√ Inapplicable
2013 Annual Report of Wuxi Little Swan Company Limited（3）Leasing
Particulars about leasing:
During the reporting period, no major leasing events occurred. Nor there were such events that occurred in previous periods but lasted to the reporting period.
Any leasing event with anover-10% influence on the total profit of the Company for the reporting period:□ Applicable√ Inapplicable
2. Guarantees provided by the Company
Unit: RMB Ten Thousand
|||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
|Guarantees provided by the Company for external parties (excluding those for subsidiaries)||||||||||||||
||Disclosure||||||||||||Guarante|
|||||Actual||||||||||
||date of|||||Actual|||||||e for a|
|||Amount for||occurrence date||||Type of||Period of||Executed||
|Guaranteed party|relevant|||||guarantee|||||||related|
|||guarantee||(date of||||guarantee||guarantee||or not||
||announcem|||||amount|||||||party or|
|||||agreement)||||||||||
||ent||||||||||||not|
|Total external guarantee line||||||Total actual occurred amount||||||||
|||0||||||||0||||
|approved during the reporting||||||of external guarantee during||||||||
|period (A1)||||||the reporting period (A2)||||||||
|Total external guarantee line that||||||Total actual external guarantee||||||||
|||0||||||||0||||
|has been approved at the end of||||||balance at the end of the||||||||
|the reporting period (A3)||||||reporting period (A4)||||||||
|Guarantees provided by the Company for its subsidiaries||||||||||||||
||Disclosure||||||||||||Guarante|
||date of||||Actual occurrence||Actual||||Period of||e for a|
||||Amount for||||||Type of|||Executed||
|Guaranteed party|relevant||||date (date of||guarantee||||guarante||related|
||||guarantee||||||guarantee|||or not||
||announceme||||agreement)）||amount||||e||party or|
||nt||||||||||||not|
|Hefei Royalstar||||||||||||||
||||||||||Joint|||||
|Washing Equipment|6 Mar. 2013||160,000||18 Jan. 2013||5,986||||No|Yes|No|
||||||||||liability|||||
|Manufacturing Co.,||||||||||||||
||||||||||guarantee|||||
|Ltd||||||||||||||
|Hefei Royalstar|||||||||Joint|||||
||6 Mar. 2013||160,000||1 Feb. 2013||6,377||||No|Yes|No|
|Washing Equipment|||||||||liability|||||
|Manufacturing Co.,|||||||||guarantee|||||

2013 Annual Report of Wuxi Little Swan Company Limited
||||||||||
|-|-|-|-|-|-|-|-|-|
|Ltd|||||||||
|Hefei Royalstar|||||||||
||||||Joint||||
|Washing Equipment|6 Mar. 2013|160,000|22 Feb. 2013|4,652||No|Yes|No|
||||||liability||||
|Manufacturing Co.,|||||||||
||||||guarantee||||
|Ltd|||||||||
|Hefei Royalstar|||||||||
||||||Joint||||
|Washing Equipment|6 Mar. 2013|160,000|14 Mar. 2013|4,274||No|Yes|No|
||||||liability||||
|Manufacturing Co.,|||||||||
||||||guarantee||||
|Ltd|||||||||
|Hefei Royalstar|||||||||
||||||Joint||||
|Washing Equipment|6 Mar. 2013|160,000|20 Mar. 2013|7,831||No|Yes|No|
||||||liability||||
|Manufacturing Co.,|||||||||
||||||guarantee||||
|Ltd|||||||||
|Hefei Royalstar|||||||||
||||||Joint||||
|Washing Equipment|6 Mar. 2013|160,000|11 Apr. 2013|2,327||No|Yes|No|
||||||liability||||
|Manufacturing Co.,|||||||||
||||||guarantee||||
|Ltd|||||||||
|Hefei Royalstar|||||||||
||||||Joint||||
|Washing Equipment|6 Mar. 2013|160,000|12 Apr. 2013|739||No|Yes|No|
||||||liability||||
|Manufacturing Co.,|||||||||
||||||guarantee||||
|Ltd|||||||||
|Hefei Royalstar|||||||||
||||||Joint||||
|Washing Equipment|6 Mar. 2013|160,000|10 May. 2013|2,475||No|Yes|No|
||||||liability||||
|Manufacturing Co.,|||||||||
||||||guarantee||||
|Ltd|||||||||
|Hefei Royalstar|||||||||
||||||Joint||||
|Washing Equipment|6 Mar. 2013|160,000|8 Jun. 2013|2,285||No|Yes|No|
||||||liability||||
|Manufacturing Co.,|||||||||
||||||guarantee||||
|Ltd|||||||||
|Hefei Midea washing|||||Joint||||
||6 Mar. 2013|160,000|9 Jul. 2013|1,736||No|No|No|
|machine co., LTD|||||liability||||
|(Notes)|||||guarantee||||
||||||Joint||||
|Hefei Midea washing|||||||||
||6 Mar. 2013|160,000|22 Aug. 2013|2,170||No|No|No|
||||||liability||||
|machine co., LTD|||||||||
||||||guarantee||||
||||||Joint||||
|Hefei Midea washing|||||||||
||6 Mar. 2013|160,000|12 Sep. 2013|2,280||No|No|No|
||||||liability||||
|machine co., LTD|||||||||
||||||guarantee||||

2013 Annual Report of Wuxi Little Swan Company Limited
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
||||||||Joint|||||
|Hefei Midea washing||||||||||||
||6 Mar. 2013||160,000|17 Sep. 2013||1,211|||No|No|No|
||||||||liability|||||
|machine co., LTD||||||||||||
||||||||guarantee|||||
||||||||Joint|||||
|Hefei Midea washing||||||||||||
||6 Mar. 2013||160,000|16 Oct. 2013||1,628|||No|No|No|
||||||||liability|||||
|machine co., LTD||||||||||||
||||||||guarantee|||||
||||||||Joint|||||
|Hefei Midea washing||||||||||||
||6 Mar. 2013||160,000|22 Oct. 2013||1,195|||No|No|No|
||||||||liability|||||
|machine co., LTD||||||||||||
||||||||guarantee|||||
||||||||Joint|||||
|Hefei Midea washing||||||||||||
||6 Mar. 2013||160,000|24 Oct. 2013||13|||No|No|No|
||||||||liability|||||
|machine co., LTD||||||||||||
||||||||guarantee|||||
||||||||Joint|||||
|Hefei Midea washing||||||||||||
||6 Mar. 2013||160,000|28 Oct. 2013||109|||No|No|No|
||||||||liability|||||
|machine co., LTD||||||||||||
||||||||guarantee|||||
|||||||Total actual occurred||||||
|Total guarantee line approved for||||||||||||
|||||||amount of guarantee for||||||
|the subsidiaries during the reporting||||||||||||
||||165,000||||||47,289|||
|||||||the subsidiaries during||||||
|period||||||||||||
|||||||the reporting period||||||
|(B1)||||||||||||
|||||||(B2)||||||
|||||||Total actual guarantee||||||
|Total guarantee line that has been||||||balance for the||||||
||||165,000||||||10,344|||
|approved for the subsidiaries at the||||||subsidiaries at the end||||||
|end of the reporting period (B3)||||||of the reporting period||||||
|||||||(B4)||||||
|Total guarantee amount provided by the Company (total of the above-mentioned two kinds of guarantees)||||||||||||
|Total guarantee line approved|||||Total actual occurred amount|||||||
|||165,000||||||47,289||||
|during the reporting period|||||of guarantee during the|||||||
|(A1+B1)|||||reporting period (A2+B2)|||||||
|Total guarantee line that has been||||||||||||
||||||Total actual guarantee balance|||||||
|approved at the end of the||||||||||||
|||165,000||||||10,344||||
||||||at the end of the reporting|||||||
|reporting period||||||||||||
||||||period (A4+B4)|||||||
|(A3+B3)||||||||||||
|Proportion of total guarantee amount (A4+B4) to the net assets||||||||||||
||||||2.65%|||||||
|of the Company||||||||||||
|Of which:||||||||||||
|Amount of guarantee for shareholders, actual controller and||||||||||||
||||||0|||||||
|related parties (C)||||||||||||

2013 Annual Report of Wuxi Little Swan Company Limited
|||
|-|-|
|Amount of debt guarantee provided for the guaranteed party||
||0|
|whose asset-liability ratio is not less than 70% directly or||
|indirectly (D)||
|Part of the amount of the total guarantee over 50% of net assets||
||0|
|(E)||
|Total amount of the above three guarantees (C+D+E)|0|

 Notes: In June of 2013, the subsidiary of the Company--Hefei Royalstar Washing Equipment Manufacturing Co., Ltd changed its name as Hefei Midea Washing Machine Co., Ltd.
3. Other significant contracts
N/A
4. Other significant transactions
N/A
VII. Performance of commitments
1. Commitments made by the Company or shareholders holding over5% of theCompany’s shares in the reporting period, or such commitments carried down into the reporting period
|||||||
|-|-|-|-|-|-|
||||Time of|Period||
||Commit|||||
|Commitm|||making|of|Fulfillme|
||ment|Contents||||
|ent|||commitme|commit|nt|
||maker|||||
||||nt|ment||
|Commitment onsharereform||Where the controlling shareholder GD Midea Holding Co., Ltd. (Midea||||
|||Holding) plans to sell the Company’s shares released from trading|||In the|
||Controlli|||||
|||moratorium held by it via the bid trading system of the Shenzhen Stock|||process|
||ng||28 Feb.|Long-ter||
|||Exchange, and Midea Holding decreases over 5% shares within six months|||of|
||sharehol||2008|m||
|||since the first reduction of holdings, Midea Holding will disclose the|||implemen|
||der|||||
|||suggestive announcement on share selling through the Company two trading|||tation|
|||days before its first reduction of holdings.||||
||Controlli|||Complet||
||ng|||ed the|In the|
|||1. As for Midea Holding’s commitment on share lock-up, it has committed||||
||sharehol|||impleme|process|
|||that it will not transfer Little Swan shares held by it within 36 months since|1 Dec.|||
||der and|||ntation|of|
|||the date when the private share offering deal is closed.|2010|||
||actual|||on 1|implemen|
||controlle|||Dec.|tation|
||r|||2013||
||Controlli|2. As for the commitment of avoiding horizontal competition, Midea Holding|||In the|
||ng|(the controlling shareholder) and Mr. He Xiangjian (the actual controller) has|1 Dec.|Long-ter|process|
||sharehol|promised that, for the period after the said transaction when the Company’s|2010|m|of|
||der and|controlling shareholder and actual controller remain unchanged, Midea|||implemen|

2013 Annual Report of Wuxi Little Swan Company Limited
||||||
|-|-|-|-|-|
|actual|Holding, Mr. He Xiangjian and other subsidiary companies under their|||tation|
|controlle|control excluding the Company and the Company’s subordinate companies||||
|r|will not increase business or establish new subsidiary companies engaged in||||
||business which is the same with or similar to the Company’s main business||||
||or forms substantial horizontal competition with the Company. If they act||||
||against the commitment above, profits thus generated will be attributable to||||
||the Company.||||
||3. As for the commitment for regulating related-party transactions, GD||||
||Midea Holding (the controlling shareholder) and Mr. He Xiangjian (the actual||||
|Controlli|controller) have promised that when there are inevitable related-party||||
|ng|transactions or such transaction incurred with rational reasons after the|||In the|
|sharehol|completion of the transaction, they will follow the fair, reasonable and market|||process|
|||1 Dec.|Long-ter||
|der and|principles in formulating and signing relevant agreements on such|||of|
|||2010|m||
|actual|related-party transactions and ensure that no harm will be done to interests of|||implemen|
|controlle|the Company and other shareholders. Where GD Midea Holding and Mr. He|||tation|
|r|Xiangjian act against the promise above and damage interests of the||||
||Company and other shareholders, they will assume liabilities for||||
||compensation according to relevant provisions.||||
|Controlli|||||
|ng||||In the|
|sharehol|4. As for the commitment on independence, GD Midea Holding has promised|||process|
|||1 Dec.|Long-ter||
|der and|to protect Little Swan’s independence in terms of assets, staff, finance,|||of|
|||2010|m||
|actual|organization and business.|||implemen|
|controlle||||tation|
|r|||||
|Controlli|5. As for the commitment on related-party deposits and borrowings, up to 8||||
|ng|Apr. 2010, the Financial Settlement Center of GD Midea Holding had settled|||In the|
|sharehol|all internal deposits and borrowings with Hefei Royalstar Washing|||process|
|||1 Dec.|Long-ter||
|der and|Equipment Manufacturing Co., Ltd.; and GD Midea Holding has promised|||of|
|||2010|m||
|actual|that there will be no more deposits, borrowings or other funds flows incurred|||implemen|
|controlle|between the Financial Settlement Center and Hefei Royalstar Washing|||tation|
|r|Equipment Manufacturing Co., Ltd..||||
||6. The commitment by GD Midea Holding on housing properties with no||||
||ownership certificates of the target company for sale is detailed as follows.||||
|Controlli|||||
||Two pieces of the buildings of Royalstar Washing Equipment assessed and||||
|ng||||In the|
||sold to the Company are of no ownership certificates—the warehouse for||||
|sharehol||||process|
||half-finished products (176 square meters) and the workshop for injection|1 Dec.|Long-ter||
|der and||||of|
||molding (834 square meters), both located in the old factory of Royalstar|2010|m||
|actual||||implemen|
||Washing Equipment, Hewa Road, Hefei. GD Midea Holding has promised||||
|controlle||||tation|
||that if loss occurs due to the said two buildings without ownership certificates||||
|r|||||
||in the asset disposal process in the future, it will assume the loss thus caused||||
||and make compensation to the Company.||||
|Controlli|7. The commitment by GD Midea Holding on trademarks is detailed as|1 Dec.|(2)|In the|

2013 Annual Report of Wuxi Little Swan Company Limited
|||||||
|-|-|-|-|-|-|
||ng|follows. (1) Concerning the “Midea” trademark: Upon approval and|2010|Concern|process|
||sharehol|implementation of the equity transfer transaction, GD Midea Holding has||ing the|of|
||der and|promised that it will make sure that Royalstar Washing Equipment uses the||“Royalst|implemen|
||actual|“Midea” trademark in a proper manner. Royalstar Washing Equipment will||ar”|tation|
||controlle|be allowed to use the “Midea” trademark with a trademark use fee not more||trademar||
||r|than that paid by Midea Group (the controlling shareholder of GD Midea||k was||
|||Holding) and its subsidiaries (currently 3‰ of the annual sales income||expired||
|||generated by products using the “Midea” trademark), and upon negotiation||on 31||
|||and signing of the “Agreement for Trademark Use”. The related-party||Mar.||
|||transactions incurred due to the said use of the “Midea” trademark will be||2013||
|||submitted to the decision-making organ of the Company for approval||and will||
|||according to the stipulated procedure. As such, interests of the Company and||not be||
|||its minority shareholders will be safeguarded. (2) Concerning the “Royalstar”||renewed||
|||trademark: GD Midea Holding has signed the “Contract for Trademark Use”||, others||
|||with Royalstar Group and obtained the ordinary use rights of the “Royalstar”||are in||
|||(or “荣事达”) trademark. As the transferor in the transfer transaction of||the||
|||equity interests of Royalstar Washing Equipment, GD Midea Holding has||process||
|||promised that within the scope as agreed in the “Contract for Trademark||of long||
|||Use”, if any dispute arises between Royalstar Washing Equipment and||term||
|||Royalstar Group over the former’s execution of the “Contract for Trademark||impleme||
|||Use”, Little Swan will not be involved. If Royalstar Washing Equipment and||ntation||
|||Little Swan have to assume any responsibility or loss due to the aforesaid||||
|||dispute, GD Midea Holding is willing to take on the responsibility instead||||
|||and make compensations to Royalstar Washing Equipment and Little Swan at||||
|||full amount.||||
|||8. The commitment by GD Midea Holding on social security payment and||||
|||tax risks is detailed as follows. GD Midea Holding has promised that upon||||
|||the completion of the said equity transfer deal, if Royalstar Washing||||
|||Equipment is obliged to take on any responsibility or pay relevant fares as||||
|||required by relevant government authorities due to its social security payment||||
||Controlli|||||
|||before the said deal, GD Midea Holding is willing to pay relevant fares for||||
||ng||||In the|
|||Royalstar Washing Equipment to relevant government authorities in a timely||||
||sharehol||||process|
|||manner and assume any other liability. If any loss thus occurs to Royalstar|1 Dec.|Long-ter||
||der and||||of|
|||Washing Equipment or Little Swan, GD Midea Holding is willing to assume|2010|m||
||actual||||implemen|
|||relevant responsibilities for compensation. Upon the completion of the said||||
||controlle||||tation|
|||equity transfer deal, if income tax evasion or any other tax risk is found in||||
||r|||||
|||Royalstar Washing Equipment, GD Midea Holding is willing to assume||||
|||relevant legal responsibilities and risks and pay relevant taxes in a timely||||
|||manner to relevant government authorities; and if any loss thus occurs to||||
|||Little Swan, GD Midea Holding will assume the corresponding responsibility||||
|||for compensation.||||
|Commitments madeupon the||||||

2013 Annual Report of Wuxi Little Swan Company Limited
|||
|-|-|
|assetsreorganization||
|Commitments madeupon IPOorrefinancing||
|Othercommitments madetominorityshareholders||
|Executed||
|timely or|Yes|
|not?||

VIII. Particulars about engagement and disengagement of CPAs firm
CPAs firm engaged at present
|||
|-|-|
|Name of domestic CPAs firm|Jiangsu Gongzheng Tianye Certified Public Accountants LLP|
|Consecutive years of the audit services provided by||
||Seven years（including the year of 2013）|
|domestic CPAs firm||
|Names of the certified public accountants from the||
||Dai Weizhong, Yu Zhiqiang|
|CPAs firm||

Reengage the CPAs firm at current period or not?
□ Yes√ No
Particulars on engaging the audit firm for the internal control, financial adviser or sponsor
√ Applicable□ Inapplicable
The Company engaged Jiangsu Gongzheng Tianye Certified Public Accountants LLP as the audit firm for the internal control for the year. During the reporting period, the Company paid the financial report and internal control audit fees totaling RMB 2.35 million to Jiangsu Gongzheng Tianye Certified Public Accountants LLP. In the reporting period, as the sponsor for supervising theCompany’s stock-split reform on a sustained basis, Huatai United Securities Co., Ltd. continued to execute their duty of supervision.
IX. Other significant events
Naught
2013 Annual Report of Wuxi Little Swan Company Limited X. Significant events of subsidiaries
Naught
2013 Annual Report of Wuxi Little Swan Company Limited Section VI. Change in Shares& Shareholders
I. Changes in shares
Unit: share
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
||Before the change||Increase/decrease (+, -)|||||After the change||
||||||Capita|||||
||||Issuan||lizatio|||||
|||Proportion|ce of|Bonus|n of||||Proportio|
||Amount|||||Others|Subtotal|Amount||
|||(%)|new|shares|public||||n (%)|
||||shares||reserv|||||
||||||e fund|||||
|I. Restricted||||||||||
||252,003,449|39.84%||||-248,313,559|-248,313,559|3,689,890|0.58%|
|shares||||||||||
|3. Shares held by||||||||||
|other domestic|221,151,735|34.97%||||-217,461,845|-217,461,845|3,689,890|0.58%|
|investors||||||||||
|Among which:||||||||||
|shares held by||||||||||
||221,148,735|34.96%||||-217,461,845|-217,461,845|3,686,890|0.58%|
|domestic||||||||||
|corporations||||||||||
|Shares held by||||||||||
|domestic natural|3,000|||||||3,000||
|persons||||||||||
|4. Shares held by||||||||||
||30,851,714|4.88%||||-30,851,714|-30,851,714|||
|foreign investors||||||||||
|Among which:||||||||||
|Shares held by||||||||||
||30,851,714|4.88%||||-30,851,714|-30,851,714|||
|foreign||||||||||
|corporations||||||||||
|II. Non-restricted||||||||||
||380,484,315|60.16%||||248,313,559|248,313,559|628,797,874|99.42%|
|shares||||||||||
|1. Ordinary shares||||||||||
|denominated in|220,300,157|34.83%||||217,461,845|217,461,845|437,762,002|69.21%|
|RMB||||||||||
|2. Domestically||||||||||
|listed foreign|160,184,158|25.33%||||30,851,714|30,851,714|191,035,872|30.2%|
|shares||||||||||

2013 Annual Report of Wuxi Little Swan Company Limited
||||||
|-|-|-|-|-|
|III. Total shares|632,487,764|100%|632,487,764|100%|

 Reason for the change in shares
√ Applicable□ Inapplicable
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
|||||||Restricted|||||
||||||||||Reason forrestriction||
|||Restricted||||shares||Restricted||Date ofunlocking|
|||||Shares unlocked|||||||
|Name of shareholder||shares at||||increased||shares at|||
|||||in current year|||||||
|||year-begin||||in current||year-end|||
|||||||year|||||
|GD Midea Holding Co., Ltd.|216,342,015||216,342,015||||0||Note1||
|TITONIINVESTMENTS|30,851,714||30,851,714||||0||||
||||||||||Note1||
|DEVELOPMENT LTD.|||||||||||
|Yang Jiezhen|756,000||673,898||-82,102||0||Note 2||
|Shenzhen Xinhua Wealth Asset|270,000||240,678||-29,322||0||||
||||||||||Note 2||
|Management Co; Ltd|||||||||||
|Jiangsu Little Swan Group Co., Ltd|||205,254||205,254||0||Note 2||
|Fushun Special Steel Group Co., Ltd|864,000||||-864,000||0||Note 3||
|The Northeast Special Steel Group Co.,|||||770,170||770,170||||
||||||||||Note 3||
|Ltd|||||||||||
|Other Restricted Shareholders|2,919,720||||||2,919,720||Note 4||
|Total|252,003,449||248,313,559||0||3,689,890||--|--|

 Note1：During the reporting period, the Company privately issued A-shares to GD Midea Holding Co., Ltd. that GD Midea Holding Co., Ltd. made a commitment that it would not transfer the shares of the Company within 36 months since the final day of privateissuing；on 3 Dec. 2013, 247,193,729 shares holding by GD Midea Holding Co., Ltd and its wholly-owned subsidiaries TITONIINVESTMENTS DEVELOPMENT LTD was cancelled the restricted listed circulation, for details please refer to the Suggestive Announcement on Non Public Shares Released from Trading Moratorium of Wuxi Little Swan Company Limited (Announcement No.: 2013-29, published on Securities Times, Hong Kong Ta Kung Pao and http://www.cninfo.com.cn on 3 Dec. 2013)
Note 2: on 23 Oct. 2013 a total of 1,119, 830 shares subject to trading moratorium held by three restricted shareholders were released, for details please refer to the Suggestive Announcement on Shares Released from Trading Moratorium of Wuxi Little Swan Company Limited (Announcement No.: 2013-28, published on Securities Times, Hong Kong Ta Kung Pao and http://www.cninfo.com.cn on 23 Oct. 2013)
Note3：Fushun Special Steel Group Co.,Ltd.’s original 864,000 shares of restricted share, after pay for the consideration share 93,830 shares, the remaining 770,170 restricted share transfer in the Northeast Special Steel Group Co., Ltd through the court ruling.
Note 4: on 4 Aug. 2006, the Company completed the reform of non-tradable shares. Between the non-tradable shares, 14 shareholders participate in the share reform, the remaining 94 of share reform consideration by the
share reform paid by the controlling shareholder Jiangsu Little Swan Group Co., Ltd. Expired on the end of the
reporting period, there are 14 shareholders did not released from Trading Moratorium, the total number of
shares are 3689890 shares.
2013 Annual Report of Wuxi Little Swan Company Limited Approval of the change in shares
□ Applicable√ Inapplicable
Transfer of share ownership
□ Applicable√ Inapplicable
Effects of the change in shares on the basic EPS, diluted EPS, net assets per share attributable to common shareholders of the Company and other financial indexes over the last year and last period
□ Applicable√ Inapplicable
Other contents that the Company considered necessary or were required by the securities regulatory authorities to disclose
□ Applicable√ Inapplicable
II. Issuance and listing of securities
1. Securities issued in the three years ended 31 Dec. 2013
||||||||
|-|-|-|-|-|-|-|
||||Number of||Number approved|Ending date of|
|Stock name|Issuing date|Issuing price||Listing date|||
||||shares issued||for listing|trade|
|Stock|||||||
|A share|18 Nov. 2010|8.63|84,832,004|02 Dec. 2010|84,832,004||
|Convertible company bonds, detachable convertible bonds, other company bonds, etc.|||||||
|Warrant|||||||

Explanation on securities issuance over the past three years
In accordance with the Reply on Approving the Significant Assets Reorganization of Wuxi Little Swan Co., Ltd. and its Share Issuance to GD Midea Holding Co., Ltd. in exchange of assets (ZJXK[2010] Document No.1577) issued by China Securities Regulatory Committee (CSRC), the Company issued 84,832,004 A-shares to GD Midea Holding Co., Ltd. at the issue price as RMB 8.63 per share, which is the consideration in exchange of69.47% of Hefei Royalstar Water Industry Facilities Co., Ltd.
Under the approval of Shenzhen Stock Exchange, the privately issued 84,832,004 shares of RMB common share were listed in Shenzhen Stock Exchange since 2 Dec. 2010. GD Midea Holding Co., Ltd. made a commitment that it would not transfer the shares of the Company within 36 months after the final day of private issuing, and thereafter will trade according the stipulations of CSRC and Shenzhen Stock Exchange.
2. Changes in total shares of the Company and the shareholder structure, as well as the asset and liability structures
During the reporting period, there existed no changes in total shares of the Company, or changes in structure of shares or in asset-liability structure of the Company due to bonus shares, capitalization of shares, allotment of shares, issuance of new shares, private issuance of shares or other reasons.
3. Existing shares held by internal staff of the Company
2013 Annual Report of Wuxi Little Swan Company Limited Inapplicable
III. Shareholders and actual controller
1. Total number of shareholders and their shareholdings
Unit: share
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
||||||Total number of shareholders on the fifth trading||||||
|Total number of shareholders at the|||||||||||
|||28,907|||day before the disclosure date of the annual||||23,744||
|end of the reporting period|||||||||||
||||||report||||||
|Particulars about shares held by shareholders with a shareholding percentage over 5% or by the top ten shareholders holding shares|||||||||||
||||Sharehol|||Increase/dec|Number of||Pledged or frozen||
||Nature of|||Total shares||||Number of|||
||||ding|||rease during|non-tradab||shares||
|Name of shareholder|shareholde|||held at the||||tradable shares|||
||||percenta|||the reporting|le shares||Status of|Number|
||r|||period-end||||held|||
||||ge (%)|||period|held||shares|of shares|
|MIDEA GROUP CO., LTD.|Domesticnon-state-ownedcorporation||35.2%|222,661,571||0||222,661,571|||
|GAOLING FUND,L.P.|Overseascorporation||8.56%|54,151,586||1,783,543||54,151,586|||
|TITONI INVESTMENTSDEVELOPMENT LTD.|Overseascorporation||4.88%|30,851,714||0||30,851,714|||
|FINANCE BUREAU OFWUXI|On behalfof the state||3.49%|22,057,657||0||22,057,657|||
|BOCI SECURITIESLIMITED|Overseascorporation||3.35%|21,209,809||-265,847||21,209,809|||
|GUOTAI JUNANSECURITIES(HONGKONG)LIMITED|Overseascorporation||2.27%|14,348,071||697,629||14,348,071|||
|NATIONAL SOCIALSECURITY FUNDPORTFOLIO 102|Domesticnon-state-ownedcorporation||1.9%|12,000,000||-3,133,169||12,000,000|||
|CHINA CONSTRUCTIONBANK－BOSHI THEMEINDUSTRIAL STOCK|Domesticnon-state-owned||1.42%|8,999,108||8,699,150||8,999,108|||

2013 Annual Report of Wuxi Little Swan Company Limited
|||||||||
|-|-|-|-|-|-|-|-|
|SECURITIES INVESTMENTFUND|corporation|||||||
|ICBC－CHINAUNIVERSALEQUILIBRIUM GROWTHSTOCK SECURITIESINVESTMENT FUND|Domesticnon-state-ownedcorporation|1.26%|8,000,791||8,000,791|8,000,791||
|NATIONAL SOCIALSECURITY FUNDPORTFOLIO 108|Domesticnon-state-ownedcorporation|1.14%|7,180,101||2,395,868|7,180,101||
|Strategic investor or general corporation||||||||
|becoming a top ten shareholder due to||Inapplicable||||||
|placing of new shares (if any)(note3)||||||||
|Explanation on associated relationship or||||||||
|||GD MIDEA HOLDING CO., LTD. and TITONI INVESTMENTS DEVELOPMENT||||||
|persons acting in concert among the||||||||
|||LTD. are parties acting in concert.||||||
|above-mentioned shareholders:||||||||
|Particulars about shares held by the top ten shareholders holding shares not subject to trading moratorium||||||||
|||||Number of tradable shares||Type of shares||
|Name of shareholder||||||||
|||||held at the year-end||Type of shares|Number|
|MIDEA GROUP CO., LTD||||222,661,571||Renminbi ordinary||
|||||||shares||
|GAOLING FUND,L.P.||||54,151,586||Domestically listed||
|||||||foreign shares||
|TITONI INVESTMENTS DEVELOPMENT LTD.||||30,851,714||Domestically listed||
|||||||foreign shares||
|FINANCE BUREAU OF WUXI||||22,057,657||Renminbi ordinary||
|||||||shares||
|BOCI SECURITIES LIMITED||||21,209,809||Domestically listed||
|||||||foreign shares||
|GUOTAI JUNAN SECURITIES(HONGKONG) LIMITED||||14,348,071||Domestically listed||
|||||||foreign shares||
|NATIONAL SOCIAL SECURITY FUND PORTFOLIO 102||||12,000,000||Renminbi ordinary||
|||||||shares||
|CHINA CONSTRUCTION BANK－BOSHI THEMEINDUSTRIAL STOCK SECURITIES INVESTMENT FUND||||8,999,108||Renminbi ordinary||
|||||||shares||
|ICBC－CHINA UNIVERSAL EQUILIBRIUM GROWTHSTOCK SECURITIES INVESTMENT FUND||||8,000,791||Renminbi ordinary||
|||||||shares||

2013 Annual Report of Wuxi Little Swan Company Limited
||||
|-|-|-|
|NATIONAL SOCIAL SECURITY FUND PORTFOLIO 108|7,180,101|Renminbi ordinary|
|||shares|
||MIDEA GROUP CO., LTD. became the new controlling||
|Explanation on associated relationship or/and persons acting inconcert among the top ten tradable shareholders and betweenthe top ten tradable shareholders and the top ten shareholders|||
||shareholder of the Company after GD MIDEA HOLDING CO.,||
||LTD. It and TITONI INVESTMENTS DEVELOPMENT LTD. are||
||parties acting in concert.||
|Explanation on the ten top shareholders participating in themargin trading business (if any) (note 4)|||
||Inapplicable||

Whether the shareholders of a company conducted the transaction of repurchase under the agreement during the reporting period
□ Yea√ No
2. Particulars about the controlling shareholder
Corporation
|||||||
|-|-|-|-|-|-|
||Legal|||||
|||Date of||||
|Name of controlling|representative|||||
|||establishm|Organization code|Registered capital|Business scope|
|shareholder|/ company|||||
|||ent||||
||principal|||||
|||7 Apr.||RMB 1,686,323,389|Electric Equipment and|
|MIDEA GROUP CO., LTD|Fang Hongbo||72247334-4|||
|||2000||Yuan|Machinery|
|Operating results, financial||||||
||The Company’s controlling shareholder is MIDEA GROUP CO., LTD with the securities code of|||||
|situation, cash flow and||||||
||000333, whose operating results, financial situation, cash flow and future development strategy, etc.|||||
|future development strategy,||||||
||are published on www.cninfo.com.cn.|||||
|etc.||||||
|Shares held by the||||||
|controlling shareholder in|The Company’s controlling shareholder is MIDEA GROUP CO., LTD. with the securities code of|||||
|other listed companies by|000333, whose shares held in other listed companies by holding or shareholding is published|||||
|holding or shareholding|on www.cninfo.com.cn.|||||
|during the reporting period||||||

Change of the controlling shareholder during the reporting period
□ Applicable√ Inapplicable
|||
|-|-|
|Name of the new controlling shareholder|MIDEA GROUP CO., LTD|
|Date of change|31 Dec. 2013|
|Website for disclosure|www.cninfo.com.cn|
|Date of disclosure|7 Jan. 2014|

3. Particulars about the actual controller
Natural person
2013 Annual Report of Wuxi Little Swan Company Limited
||||
|-|-|-|
|||Whether gain the right of residence in other countries or|
|Name of the actual controller|Nationality||
|||regions or not|
||The People’s Republic of||
|He Xiangjian||No|
||China||
|Occupation and position over the five years|Chairman of the Board in Midea Holding and Midea Group||
|Particulars on his controlling listed companies|Midea Holding（000527.SZ）, Welling Holding（00382.HK) and Little Swan（A：||
|over the past ten years|000418.SZ;B:200418)||

Change of the actual controller during the reporting period
□ Applicable√ Inapplicable
The ownership and controlling relationship between the actual controller of the Company and the Company is detailed as follows:
He Xiangjian Lu Deyan
94.55%
5.45%
Midea Holding Co., Ltd.
35.49%
Midea Group Co., Ltd.
100%
Midea Electric Investment (BVI) Limited
100% 35.20%
Titoni Investments Development Ltd.
4.88%
Wuxi Little Swan Co., Ltd.
2013 Annual Report of Wuxi Little Swan Company Limited The actual controller controls the Company via trust or other ways of asset management
□ Applicable√ Inapplicable
4. Other Corporate Shareholder with a shareholding percentage over10%
Inapplicable
IV. Particulars on shareholding increase scheme during the reporting period proposed or implemented by the shareholders and act-in-concert persons
Inapplicable
2013 Annual Report of Wuxi Little Swan Company Limited Section VII. Directors, Supervisors, Senior Management Staff& Employees I. Changes in shareholding of directors, supervisors and senior management staff
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
|||||||||||Amoun|
|||||||||Amount|Amount||
||||||||Shares|||t of|
|||||||||of shares|of shares||
||||||||held at|||shares|
|||||||||increase|decrease||
|||Tenure|||||the|||held at|
|Name|Office title||Sex|Age|Start date|Ending date||d at the|d at the||
|||status|||||year-beg|||the|
|||||||||reportin|reportin||
||||||||in|||period-|
|||||||||g period|g period||
||||||||(share)|||end|
|||||||||(share)|(share)||
|||||||||||(share)|
||Chairman of the||||||||||
|Fang Hongbo||Current|Male|46|21 Aug. 2012|20 Aug. 2015|0|0|0|0|
||Board||||||||||
|Chai Xinjian|Vice Director ,|Current|Male|50|20 Aug. 2013|20 Aug. 2015|0|0|0|0|
||Director ,||||||||||
|Yin Bitong||Current|Male|45|20 Aug. 2013|20 Aug. 2015|0|0|0|0|
||General Manage||||||||||
|Xiao|||||||||||
||Director|Current|Male||21 Aug. 2012|20 Aug. 2015|0|0|0|0|
|Mingguang||||43|||||||
|Zhang Zhaofeng|Director, CFO|Current|Male|38|2 Nov. 2012|20 Aug. 2015|0|0|0|0|
||Director,||||||||||
|Zhou Sixiu|Secretary to the|Current|Female|40|21 Aug. 2012|20 Aug. 2015|0|0|0|0|
||Board||||||||||
||Independent||||||||||
|Zhao Shuming||Current|Male|61|21 Aug. 2012|9th Sep. 2014|0|0|0|0|
||director||||||||||
||Independent||||||||||
|Ye Yongfu||Current|Male|66|21 Aug. 2012|9th Sep. 2014|0|0|0|0|
||director||||||||||
||Independent||||||||||
|Yu Lihui||Current|Female|48|21 Aug. 2012|20 Aug. 2015|0|0|0|0|
||director||||||||||
||Chairman of the||||||||||
|Jiang Huafang||Current|Male|37|21 Aug. 2012|20 Aug. 2015|0|0|0|0|
||Supervisory||||||||||
||C itt||||||||||
|Yang Xiaowen|Supervisor|Current|Male|47|21 Aug. 2012|20 Aug. 2015|4,000|0|0|4,000|

2013 Annual Report of Wuxi Little Swan Company Limited
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
||Staff||||||||||
|Ye Dexin||Current|Male|41|21 Aug. 2012|20 Aug. 2015|0|0|0|0|
||representative||||||||||
|Hu Ziqiang|Deputy GM|Current|Male|56|21 Aug. 2012|20 Aug. 2015|0|0|0|0|
|Fu Wei|Deputy GM|Current|Male|37|21 Aug. 2012|20 Aug. 2015|0|0|0|0|
|Mao Zhiliang|Deputy GM|Current|Male|56|21 Aug. 2012|20 Aug. 2015|0|0|0|0|
||Former Director ,||||||||||
|Chai Xinjian||Former|Male|50|21 Aug. 2012|2nd Aug. 2013|0|0|0|0|
||General Manager||||||||||
||Former Deputy||||||||||
|Yin Bitong||Former|Male|45|21 Aug. 2012|2nd Aug. 2013|0|0|0|0|
||GM||||||||||
|Li Feide|Former Director|Former|Male|36|21 Aug. 2012|2nd Aug. 2013|0|0|0|0|
|Total|--|--|--|--|--|--|4,000|0|0|4,000|

 II. Resumes of important personnel
Main working experience of current directors, supervisors and senior management staff over the past five years: (1) Mr. Fang Hongbo, was born in Jan. 1967, master degree. He now serves in the Company as the Chairman of the Board, in Midea Group Co., Ltd. as the Chairman of the Board and concurrently President in GD Midea Holding Co., Ltd. He ever took the posts of General Manager of Air-conditioner Division Marketing Company in China, as well as of Deputy General Manager and General Manager of Air-conditioner Division subordinate to GD Midea Holding Co., Ltd., of Vice President, Vice Chairman of the Board and President in GD Midea Holding Co., Ltd..
(2) Mr. Chai Xinjian, was born in Oct. 1963, doctor degree, and researcher-level Senior Engineer. Now he acts as Director and General Manager of the Company. He ever took the posts of Director of the Technology Center and of Standing Deputy General Manager in Wuxi Little Swan Company Limited.
(3) Mr. Yin Bitong, was born in Dec. 1968, master degree. He now acts as Director and General Manager of the Company. He ever served as Assistant General Manager, Marketing Chief and Chief of large region market in South China in Midea Air-conditioner Marketing Company in China, Marketing General Manager in China in Midea (Guangzhou) Hualing Air Conditioner Equipment Co., Ltd. Domestic Marketing General Manager of Hefei Royalstar Washing Equipment Manufacturing Co., Ltd..
(4) Mr. Xiao Mingguang, was born in Feb. 1970, master degree, CPAs. He now serves as Director in the Company and Deputy Director of financial management of GD Midea Holding Co., Ltd. He ever took the posts as chief of Audit and Supervision Department, as chief of Operating and HR Department of Laundry Division and Refrigeration Division in GD Midea Holding Co., Ltd., as chief of Supply Chain Management Department of Residential Air-conditioning Division, and of chief of financial management department in Refrigeration Royalstar Joint-venture Company.
(5) Mr. Zhang Zhaofeng, was born in Aug. 1975, master degree. Now he acts as the Director and CFO in the Company. He ever took the posts of Supervisor, Director and CFO of the Company, as Chief of the Audit and Supervision Department, as Chief of Finance Department of Residential Air-conditioning Domestic Division,
CFO of Residential Air-conditioning Business Division as well as CFO of Midea-Toshiba-Carrier
Air-conditioners.
2013 Annual Report of Wuxi Little Swan Company Limited (6) Ms. Zhou Sixiu, was born in Feb. 1973, bachelor degree, CPAs. Now, she holds the posts of Director and Secretary to the Board in the Company. She ever served as Securities Affair Representative and other positions in Wuxi Qingfeng Stock Co., Ltd..
(7) Mr. Zhao Shuming, was born in Dec. 1952, doctor degree. He now serves as Independent Director of the Company and Honorary Dean, Professor and Ph.D. Candidate Tutor of School of Business of Nanjing University. He ever served as Dean of School of Business, Assistant Principal of Nanjing University. He has been the Independent Director of the Company since Sept. 2008, and concurrently serves as Independent Director of Jiangsu Lianfa Textile Co., Ltd., Anhui Hengyuan Coal-Electricity Co., Ltd. and Daqo New Energy Corp. (listed in New York Stock Exchange).
(8) Mr. Ye Yongfu, was born in Mar. 1947, master degree and Senior Engineer. He now serves as Independent Director of the Company. He ever took the posts of Deputy Director of Wuxi Municipal Economic Commission, of Director and Secretary of CPC in Wuxi Development Plan Committee, of Director and Secretary of CPC in Wuxi Municipal Economic and Trade Commission, and concurrently held Deputy Secretary-general of the Municipal Government, of Director of the Enterprise Management Center, of Director and Secretary of CPC of Training Center of National Center for Management Development at Wuxi, as well as Deputy Leader of Wuxi Support Leading Group. He has been the Independent Director of the Company since Sept. 2008, and concurrently serves as Independent Director of Wuxi Commercial Mansion Grand Orient Co., Ltd. and Jiangsu Zhongchao Cable Corporation.
(9) Ms. Yu Lihui, was born in Oct. 1965, master degree and CPA. She now serves as Independent Director of the Company and acts as the associate professor in the School of Business of East China University of Science and Technology, Senior Lecturer of Ourui Management Consultant Co., Ltd. at present. She ever served as Training Specialist of AMA. And she has been the Independent Director of the Company since Sept. 2009.
（10）Mr. Jiang Huafang, was born in Jan. 1976, bachelor degree. He serves as Supervisor, Director of Operation& HR Department in the Company. He ever took the posts of Chief of Overseas Supporter Department and Chief of Supply Chain Management Department in the Company, of Regional Sales Manager of Midea Central Air Conditioner Marketing Company, of Deputy Purchasing Manager of Hefei Hualing Electric Appliances Co., Ltd., of Department Director and Chief of Supply Chain Management Department in Hefei Royalstar Washing Equipment Manufacturing Co., Ltd..
(11) Mr. Yang Xiaowen, was born in Sep. 1966, bachelor degree. He now serves as the Supervisor and general manager of theCompany’s subsidiary, WuXi General Appliance Co., Ltd.. He once served as the technological deputy general manager of Wuxi General Appliance Co., Ltd..
(12) Mr. Ye Dexin, was born in Jan. 1972, master degree. He now serves as Supervisor and the employee representative supervisors and Chief engineer of Product planning in TechnicalR&D Center. He ever served as Chief of TechnicalR&D Center in the Company and the Chief of Wave-wheel Design Room 3, Chief of Cylinder Design Room 2 of theR&D Center in the Company and the Chief of theR&D Department of the Drum Washing Machine Company.
(13) Mr. Hu Ziqiang, was born in Oct. 1957, doctor degree. He now serves as the deputy GM and Technical Principal of the Company. He ever served as the Principal of the Vibration Noise Team in theR&D Center of GE Group, Manager of GE Household Electrical Appliances Company, Deputy GM and Chief ofR&D Center in Su Zhou Samsung Electronics Co., Ltd..
(14) Mr. Fu Wei, was born in Aug. 1976, bachelor degree. Now he serves as the Deputy GM and GM of Overseas Sales Company in the Company. He ever acted as Regional Manager and Area Manager of Air-conditioner Overseas Division in GD Midea Holding Co., Ltd., Senior Manager of Electrolux Operation Center of
2013 Annual Report of Wuxi Little Swan Company Limited Air-conditioner Overseas Division and GM of Washing Machine Operation Department of International Division in GD Midea Holding Co., Ltd..
(15) Mr. Mao Zhiliang, was born in Jun. 1957, master degree. He now acts as Deputy GM of the Company. He ever served as the GM of Wuxi Little Swan General Appliance Co., Ltd. and GM of the Drum Washing Machine Company in the Company.
Post-holding in shareholder units
√Applicable□Inapplicable
|||||||
|-|-|-|-|-|-|
|Name of the|||||Receives|
|person holding|||||payment|
||Name of the shareholder|Position in the shareholder|Beginning date of|Ending date of||
|any post in any|||||from the|
||unit|unit|office term|office term||
|shareholder|||||shareholder|
|unit|||||unit?|
||GD Midea Holding Co.,|||||
|Fang Hongbo||Chairman of the Board|25 Aug. 2012|24 Aug. 2015|Yes|
||Ltd.|||||
||GD Midea Holding Co.,|Deputy GM of||||
|Chai Xinjian|||1st Dec. 2013||Yes|
||Ltd.|International business||||
|Xiao|GD Midea Holding Co.,|Deputy director of||||
||||18 Sep. 2013||Yes|
|Mingguang|Ltd.|financial management||||

Post-holding in other units
√Applicable□Inapplicable
|||||||
|-|-|-|-|-|-|
|Name of the||||||
|||||Ending||
|person holding||||||
||Name of other unit|Position in other unit|Beginning date of|date of|Receives payment|
|any post in|||office term|office|from other unit?|
|||||term||
|other units||||||
|||Honorary Dean,||||
||School of Business of Nanjing|||||
|Zhao Shuming||Professor and Ph.D.|1 Oct. 1991||No|
||University|||||
|||Candidate Tutor||||
||School of Business of East|||||
|Yu Lihui|China University of Science|Associate professor|1 Jul. 1991||No|
||and Technology|||||

III. Remuneration for directors, supervisors and senior management
Decision-making procedure, determining basis and actual payment for the remuneration of directors, supervisors and senior management
(1) Decision-making procedure for the remuneration of directors, supervisors and senior management: The remuneration of directors, supervisors and senior management receiving remuneration from the Company is
decided after the approval of the Board of Directors.
(2) Determining basis for the remuneration of directors, supervisors and senior management: The remuneration of
directors, supervisors and senior management receiving remuneration from the Company consist of the basic
2013 Annual Report of Wuxi Little Swan Company Limited annual salary and performance annual salary. The basic annual salary is decided according to the duties, risks, pressure and other factors born by the directors, supervisors and senior management, and it stays unchanged; while the performance annual salary is linked with the profit completion rate and the appraisal results of target responsibility system of the Company. The remuneration system of the directors, supervisors and senior management of the Company serves for its operating strategy, which is adjusted according to the changes of operation situation of the Company so as to adapt to the needs of the further development of the Company. The adjustment basis for the remuneration of directors, supervisors and senior management of the Company is as follows: (1) the increase level of remuneration in the same industry; (2) the inflation level; (3) the earnings of the Company; (4) the adjustment of organization structure; (5) individual adjustment on positions. The allowance for independent directors approved by the Board of Directors is RMB 80,000 per year, and the expenses occurred to execute their responsibilities are born by the Company.
(3) Actual payment for the remuneration of directors, supervisors and senior management: The basic salary of directors, supervisors and senior management receiving remuneration from the Company is paid monthly; the allowance for independent directors is paid quarterly.
Remuneration of the directors, supervisors and senior management of the Company during the reporting period Unit: RMB Ten thousand
|||||||||
|-|-|-|-|-|-|-|-|
||||||Total|Total||
||||||||Actual|
||||||remuneration|remuneration||
|Name|Position|Sex|Age|Tenure status|||remuneration at|
||||||gained from the|gained from||
||||||||the period-end|
||||||Company|shareholder’s||
|Fang Hongbo|Chairman of the Board|Male|46|Current||679.82|679.82|
|Chai Xinjian|Vice Director|Male|50|Current|82.97|214.13|297.1|
|Yin Bitong|Director , GM|Male|45|Current|300.81||300.81|
|Xiao||||||||
||Director|Male|43|Current||199.6|199.6|
|Mingguang||||||||
|Zhang|Director, CFO|Male|38|Current|167.94||167.94|
|h fZhou Sixiu|Director, Secretary to the|Female|40|Current|118.98||118.98|
|Zhao Shuming|dIndependent director|Male|61|Current|8||8|
|Ye Yongfu|Independent director|Male|66|Current|8||8|
|Yu Lihui|Independent director|Female|48|Current|8||8|
|Jiang Huafang|Chairman of the|Male|37|Current|125.97||125.97|
|Yang Xiaowen|i iSupervisor|Male|47|Current|48.25||48.25|
|Ye Dexin|Staff representative|Male|41|Current|113.11||113.11|
|Hu Ziqiang|iDeputy GM|Male|56|Current|513.07||513.07|
|Fu Wei|Deputy GM|Male|37|Current|233.69||233.69|
|Mao Zhiliang|Deputy GM|Male|56|Current|204.83||204.83|

2013 Annual Report of Wuxi Little Swan Company Limited
|||||||||
|-|-|-|-|-|-|-|-|
|Li Feide|Director|Male|36|Former||197.1|197.1|
|Total|--|--|--|--|1,933.62|1,290.65|3,224.27|

 Particulars about the equity incentives awarded for the directors, supervisors and senior management of the Company
□ Applicable√ Inapplicable
IV. Changes in engagement and dismissal of Directors, Supervisors and Senior Management Staffs within the reporting period
||||||
|-|-|-|-|-|
|Name|Position|Type|Date|Reason|
|||Leaving the|||
|Chai Xinjian|GM||2nd Aug. 2013|Job changes|
|||office|||
|||Leaving the|||
|Yin Bitong|Deputy GM||2nd Aug. 2013|Job changes|
|||office|||
|||Leaving the|||
|Li Feide|Director||2nd Aug. 2013|Job changes|
|||office|||

V. Particulars about changes in core technical team or key technicians during the reporting period (not directors, supervisors or senior management)
There was no change in core technical team or key technicians (not directors, supervisors or senior management) and other persons who have significant influence on theCompany’s core competitiveness during the reporting period, which has no influence on theCompany’s operation.
VI. About employees
Employee’s remuneration policy and training plan
(1)Employee’s remuneration policy: It will adopt irregular work system and integrated working hours foremployee’s remuneration according to the nature and content of the positions, and sign the collective wage contract by collective wage consultation system.
(2)Employee’s training: It will decide the training content for employees from different levels and groups according to the post qualification, and promote the training of entire staff, so as to build a learning organization.
2013 Annual Report of Wuxi Little Swan Company Limited
||
|-|
|Financial personnel|

Administrative personnel
Technicians Master degree or above
Junior middle school
Bachelor degree
Sales personnel and below
Junior college Production personnel
Technical secondary scho ol
Composition of education
Composition of profession
2013 Annual Report of Wuxi Little Swan Company Limited Section VIII. Corporate Governance
I. Basic information of corporate governance
The Company continuously perfected its corporate governance; promote the improvement of its operation in accordance with the requirements of relevant laws and rules such as Company Law, Securities Law issued by CSRC. The actual situation of theCompany’s corporate governance is in accordance with the requirements of Administrative Rule for Listed Companies issued by CSRC
The Company set up Rules of Procedure for the operation of Board of Directors, Supervisory Board andShareholders’ General Meeting, Rules of Procedure, The Disclosure of Information Management System, Raise Money Management System, Related Transaction Management System, Information Source Insider Registration Management System, Internal Report System for the Major Issues, System of Accountability for Management etc files of standard management for the Special Committee of the Board. During the reporting period, the Company set up Risk Management Plan about Deposit and Lending Financial Business of the Midea Group Financial Co., Ltd., clear about the risk management process, ensuring the security of the company funds.
TheCompany’s shareholder meeting, board of directors, board of supervisors and management are in liability trenchant, cooperatively and effectively check and balance, scientifically making decision, coordinately operating, lay a solid foundation for thecompany’s sustained, stable and healthy development.
Whether it exists any difference between the corporate governance and the Company Law and relevant rules of CSRC or not?
□ Yes√ No
There is no difference between the corporate governance and the Company Law and relevant rules of CSRC. Progress of corporate governance activities, promulgation and implementation of Registration System for Information Insiders
During the year, the Company did well the confidential work for inside information in strict accordance with the newly revised Registration System for Information Insiders of Wuxi Little Swan Company Limited (published on http://www.cninfo.com.cn dated 2 Mar. 2012) and Regulations of CSRC for Listed Companies on Establishing Registration System for Information Insiders as well as other relevant regulations, and did well the registration work for information insiders. Upon self-examination, no information insider was found to manipulate insider information for trading theCompany’s shares before the Company disclosed significant and sensitive information that might affect its share price. And the Company received no monitoring& inspection measures or administrative punishments from regulators due to its execution of the Information Insider Registration Mechanism or insider trading. During the reporting period, directors, supervisors and senior management of the Company were not involved in any illegal trading of theCompany’s shares.
II. Particulars about annualshareholders’ general meeting and specialshareholders’ general meeting held during the reporting period
1. Particulars about annualshareholders’ general meeting held during the reporting period
2013 Annual Report of Wuxi Little Swan Company Limited
|||||||
|-|-|-|-|-|-|
||Convening|||Disclosure||
|Session||Name of proposal|Resolution||Disclosure index|
||date|||date||
|||1. Annual Financial Statement Report 2012; 2. Annual||||
|||Profit Distribution Plan 2012; 3. Annual Work Report||||
|||of the Board 2012; 4. Annual Work Report of the||||
|||Supervisory Board 2012; 5. Annual Report and Its||||
||||All the||(Announcement No.:|
|2012 Annual||Abstract 2012; 6. Proposal on Engaging the Audit||||
||||proposals||2013-09) was|
|Shareholders’||Firm for the 2013 Annual Financial Report; 7.||13 Apr.||
||12 Apr. 2013||are approved||published|
|General||Proposal on Engaging the Audit Firm for the 2013||2013||
||||at the||on www.cninfo.com.|
|Meeting||Annual Internal Control; 8. Proposal on Prediction of||||
||||session||cn|
|||the Line of Routine Related Transaction of the||||
|||Company for 2013; 9. Proposal on the Company’s||||
|||Appling for Bank Loan Line of Credit and Offering||||
|||Accumulative Guarantee Amount for the Subsidies;||||

2. Particulars about specialshareholders’ general meeting held during the reporting period
|||||||
|-|-|-|-|-|-|
||Convening|||Disclosure||
|Session||Name of proposal|Resolution||Disclosure index|
||date|||date||
|||1. Related Transaction Proposal about||||
|||Sign Financial Services Agreement with||||
|The First||Midea Group Financial Co., Ltd||||
||||||(Announcement No.:|
|Special||2. Related Party Transactions Proposal on||||
||||All the proposals are||2013-22) was|
|Shareholders’||the Trademark Licensing||28 Aug.||
||27 Aug. 2013||approved at the||published|
|General||3. Proposal about the Company in 2014 to||2013||
||||session||on www.cninfo.com.|
|Meeting for||Carry out the Forward Foreign Exchange||||
||||||cn（|
|2013||Transactions 4. Proposal about||||
|||Additionally Electing the Directors of the||||
|||Company||||

III. Duty performance of independent directors in the reporting period
1. Particulars about the independent directors attending the board sessions and theshareholders’ general meetings
||||||||
|-|-|-|-|-|-|-|
|Particulars about the independent directors attending the board sessions|||||||
|||||||Failing to attend|
|Name of independent|Due presence|Presence in|Presence by|Entrusted|||
||||||Absence (times)|in person for two|
|directors|(times)|person (times)|telecommunicati|presence (times)|||
|||||||consecutive|

2013 Annual Report of Wuxi Little Swan Company Limited
||||||||
|-|-|-|-|-|-|-|
||||on (times)|||sessions or not|
|Zhao Shuming|5|1|3|0|1|No|
|Ye Yongfu|5|0|4|1|0|No|
|Yu Lihui|5|1|4|0|0|No|
|Presence of independent directors in|||||||
|||2|||||
|shareholders’ general meeting (times)|||||||

No independent directors failed to attend board sessions in person for two consecutive times.
2. Particulars about independent directors proposing objection on relevant events
Whether independent directors propose objection on relevant events or not?
□ Yes√ No
The independent directorsdidn’t propose objection on relevant events during the reporting period.
IV. Duty performance of the Special Committees under the Board during the reporting period During the reporting period, the performance of the Special Committees under the Board was as follows:
1. The Audit Committee under the Board convened two sessions, at which reviewed and approved the Annual Financial Statement Report 2012, Annual Report and Its Abstract 2012, Summary Report of the Audit Committee on the 2012 Annual Audit Work, Proposal on Engaging the Audit Firm for the 2013 Annual Financial Report, Proposal on Engaging the Audit Firm for the 2013 Annual Internal Control and 2013 Semi-annual Report and Its Abstract;
2. The strategy Committee under the Board convened one session, at which reviewed and approved the proposal on Mid-term Development Plan of the Company;
3. The Remuneration and Appraisal Committee under the Board convened one session, at which reviewed and approved the Proposal on Paying the 2012 Annual Remuneration to the Senior Management;
4. The Nomination Committee under the Board convened one session, at which reviewed and approved the Proposal on the Appointment of the General Manager and Proposal on Additionally Electing the Directors of the Company
V. Duty performance of the Supervisory Committee
Whether the Supervisory Committee finds the Company existing risks or not in the supervisory activities during the reporting period?
□ Yes√ No
The Supervisory Committee has no objection on the supervised events during the reporting period
VI. Particulars about theCompany’s independence from the controlling shareholder in respect of business, personnel, assets, organization and finance
The Company totally kept separation from the controlling shareholder in respect of business, personnel, assets,
organization and financing that it owned an independent and complete business as well as self-operation
capability.
1. In respect of business, the Company owned independent and integrated system ofR&D, purchasing, production
2013 Annual Report of Wuxi Little Swan Company Limited and sales. Main business of the Company is washing machine that thereisn’t any horizontal competition between the Company and the controlling shareholder. The Company was completely separated from the controlling shareholder in business.
2. In respect of personnel, in terms of labor, personnel and salary management, the Company and the controlling shareholder were independent each other, there existed no mixed operation and management between the Company and the controlling shareholder. Such senior management staff as General Manager, Deputy General Managers, CFO and Secretary to the Board did not take any post other than Director in Shareholding Companies respectively.
3. In respect of assets, theCompany’s assets were complete, and there was the clear property right relationship between the Company and the controlling shareholder.
4. In respect of organization, the Company has set up the organization that was independent from the controlling shareholder completely, the Board of Directors, the Supervisory Committee and internal organization could operate independently.
5. In respect of financing, the Company owned independent financial department, established independent accounting system and financial management system, opened independent bank account, paid tax in line with laws.
VII. Particulars about horizontal competition
The Companydidn’t have any horizontal competition with its controlling shareholder and actual controller. VIII. Performance appraisal and incentive mechanism for senior management staff
The selection, appraisal and incentive system of the senior management staff of the Company were implemented according to relevant regulations of the Company Law and the Articles of Association of the Company. The Company established comprehensive management system based on KPI, continued to implement the annual compensation system closely linked with theCompany’s operating achievements, which was decided by the Board of Directors, and it has effectively strengthened the sense of responsibility and improved work enthusiasm of the whole senior management staffs.
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 Section IX. Internal Control
I. Improvement of internal control of the Company
Strictly in line with laws and regulations stipulated in Company Law, Securities Law as well as Corporate Governance Principle for Listed Company promulgated by CSRC, the Company standardized corporate operation, continuing established and perfected corporate governance, drafted relevant internal control system, enforced and improved internal control work, made prevention to control company risk and safeguarded lawful rights and interests of the Company and shareholders.
According to regulations of Company Law, Articles of Association and relevant laws, the Company set up relatively completed frame system of organizational control, established rules for procedure for the Board of Directors, Supervisory Board andShareholders’ General Meeting and corporate governance. The Board of the Company worked out proposals ofShareholders’ General Meeting, shouldered significant decisions of the Company and was responsible forShareholders’ General Meeting. The Company installed general manager pursuant to the law, presided daily production, operation and management of the Company, gathered and formulated proposals of the Board as well as responsible for the Board. Supervisory Board was supervision union of the Company, which was responsible for supervision of behavior of directors, general manager and finance of the Company. The Board divided into strategic committee, remuneration and evaluation committee, and audit committee. The strategic committee, remuneration and evaluation committee, and audit committee formed a system of internal control as they accounted for separate responsibility, cooperated with each other while restricted each other at the same time.
According to requirements stipulated in Company Law, Securities Law and relevant laws and regulations of CSRC etc., the Company established and perfected Articles of Association, Rules of Procedure forShareholders’ General Meeting, Rules of Procedure for Supervisory Board, System of Independent Director, Management System of Investor Relations, Management System of Information Disclosure, Internal Reporting System of Significant Information etc., standardized and perfected corporate governance of the Company.
II. Statement of the Board about internal control responsibilities
It is the responsibility of the Board of the Company to establish, to perfect as well as to effective conduct internal control. Since the implement of internal control, framework of internal control is more perfect, system of internal control is more proper and adapting to changes in operation and development of the Company. The internal control system is running well and the risk of operation is in control.
The Board of the Company and all directors guaranteed that the Self-appraise Report of Internal Control for 2011 does not contain any false or misleading statements or omit any material facts and hereby accept, individually and collectively, responsibility for the truth, accuracy and completeness of the contents of this report.
III. Basis on which the financial reporting internal control is established
The internal control for financial report is decided according to the Basic Rules for Enterprise Internal Control and Supporting Guidelines for Enterprise Internal Control jointly issued by the five ministries of PRC, such as the Ministry of Finance.
IV. Self-appraisal report on internal control
|||
|-|-|
|Particulars about significant deficits of internal control found during the reporting period in the self-appraisal report on internal||
|control||
|In accordance with the recognition standards for the deficits of internal control, it doesn’t find any significant deficits during the||
|process of appraising internal control relevant to the financial report.||
|Disclosure date of the||
|Self-appraisal Report on Internal||
||7 Mar. 2014|
|Control||
|Disclosure index of the||
||For details about the Self-appraisal Report on the 2012 Annual Internal Control, please refer|
|Self-appraisal Report on Internal||
||to www.cninfo.com.cn, which is the information disclosure website designated by Shenzhen|
|Control||
||Stock Exchange.|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 V. Audit report on internal control
√ Applicable□ Inapplicable
|||
|-|-|
|Audit opinion paragraphs in the Audit Report on Internal Control||
|The audit firm for internal control believes that the Company makes valid internal control on financial report in all significant||
|aspects on 31 Dec. 2013 according to the Basic Rules on Enterprise Internal Control and other relevant stipulations.||
|Disclosure date of the Audit Report||
||7 Mar. 2014|
|on Internal Control||
||For details about the Audit Report on 2013 Annual Internal Control, please refer|
|Disclosure index of the Audit||
||to www.cninfo.com.cn, which is the information disclosure website designated by Shenzhen|
|Report on Internal Control||
||Stock Exchange.|

Whether the CPAs firm issues an Audit Report on Internal Control with non-standard opinion or not?
□ Yes√ No
Whether the Audit Report on Internal Control from the CPAs firm is in consistent with the Self-appraisal Report from the Board or not?
√ Yes□ No
VI. Establishment and execution of rules of accountability for significant mistakes in annual report information disclosure
The Company already formulated Rules of Accountability for Significant Mistakes in Annual Report Information Disclosure in Chapter XI., Section I of Management System for Information Disclosure. In the reporting period, thereisn’t any amendment of significant accounting false, complement of significant information omit or adjustment in prediction of performance etc.
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 X.Financial Report
NoteI Audit Report
|||
|-|-|
|Types of auditing opinion|qualified opinion without reservation|
|Signing date of the report|Mar5th, 2014|
||Jiangsu Gongzheng Tianye Certified Public|
|Accountant firm||
||Accountants, SGP|
|Number of the audit report|WCPA A [2014] NO.A089|

TO THE SHAREHOLDERS OF WUXI LITTLE SWAN COMPANYLIMITED：
We have audited the accompanying consolidated financial statements of Wuxi Little Swan Company (the “Company”) which comprise the Balance sheet as of December 31, 2013, and the Income statement, Statement of changes in equity and Cash flow statement for the year then ended, and a summary of significant accounting policies and other explanatory notes.
1.Management’s Responsibility for the Financial Statements
TheCompany’s management is responsible for the preparation and fair presentation of these financial statements. This responsibility includes:(ⅰ)preparing and fairly presenting financial statements in accordance with Accounting Standards for Business Enterprises;(ⅱ)designing, implementing and maintaining necessary internal control in order that financial statements are free from material misstatement, whether due to fraud or error. 2.Auditor’s responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with China Standards on Auditing issued by Chinese Institute of Certified Public Accountants. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on theauditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to theentity’s preparation of financial statements that gives a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting
estimates made by the management, as well as evaluating the overall presentation of the financial statements.
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
3. Audit opinion
In our opinion, the financial statements give a true and fair view of the financial position of the Company as of 31 December 2013 and of its financial performance and cash flows for the year then ended in accordance with the Accounting Standards for Business Enterprises and China Accounting System for Business Enterprises.
NoteII Financial Report
The monetary unit used in notes to the financial statements is yuan of rmb
1. CONSOLIDATED BALANCE SHEET
Prepared by:WUXI LITTLE SWAN CO., LTD.
Unit: RMB yuan
|||||||
|-|-|-|-|-|-|
||Item||2013-12-31||2012-12-31|
||Current Assets:|||||
|Monetary fund||1,617,373,088.50||1,404,291,094.65||
|Deposit reservation for balance||||||
|Lendings to banks and other financial institutions||||||
|Trading financial assets||15,016,740.00||1,224,590.00||
|Notes receivable||2,449,770,225.41||2,262,814,443.87||
|Accounts receivable||777,744,132.32||722,198,904.66||
|Prepayment||140,841,924.06||97,188,434.21||
|Insurance receivable||||||
|Reinsurance receivable||||||
|Provisions of Reinsurance contracts receivable||||||
|Interest receivable||||||
|Dividend receivable||||||
|Other Receivables||26,163,524.13||16,984,517.49||
|Repurchasing of financial assets||||||
|Inventory||798,141,838.58||952,747,860.68||
|Non-current assets due within 1 year||||||
|Other current assets||1,791,288,539.62||1,201,171,819.72||
|Subtotal of current assets||7,616,340,012.62||6,658,621,665.28||
||Non-current Assets|||||
|Loans and advance||||||
|Sellable financial asset||312,816.00||286,944.00||
|Expired investment in possess||||||

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 Long-term receivables
|||||
|-|-|-|-|
|Long-term equity investment||4,579,148.88|5,695,850.80|
|Investment real estate||9,466,777.10|5,049,500.73|
|Fixed assets||1,194,244,286.86|1,297,298,526.31|
|Construction in progress||||
|Construction materials||||
|Disposal of fixed assets||||
|Capitalized biological assets||||
|Oil-gas assets||||
|Intangible assets||219,445,532.87|308,714,119.44|
|Development expenditure||||
|Good will||||
|Long-term deferred expenses||7,147,835.74|27,729,917.87|
|Deferred tax assets||170,990,970.67|100,308,918.86|
|Other non-current assets||||
|Subtotal of non-current assets||1,606,187,368.12|1,745,083,778.01|
|Total assets||9,222,527,380.74|8,403,705,443.29|
||Current Liabilities:|||
|Short-term loans||||
|Loan from Central Bank||||
|Deposit received and hold for others||||
|Call loan received||||
|Financial liabilities||||
|Notes payable||385,673,110.34|1,003,090,693.95|
|Accounts payable||2,768,046,095.46|2,129,979,583.30|
|Advances from the customers||1,057,952,597.52|804,441,642.84|
|Selling of repurchased financial assets||||
|Fees and commissions receivable||||
|Employees’ wage payable||207,323,619.92|125,902,663.09|
|Taxes payable||199,203,856.56|-3,821,048.41|
|Interests payable||||
|Dividends payable||3,740,152.33|3,710,206.21|
|Other payables||50,021,093.66|71,726,352.37|
|Reinsurance fee payable||||
|Insurance contract provision||||
|Entrusted trading of securities||||
|Entrusted selling of securities||||
|Non-current liabilities duewithin 1 year||||
|Other current liabilities||||
|Subtotal of current liabilities||4,671,960,525.79|4,135,030,093.35|
||Non-current Liabilities:|||
|Long-term loans||||
|Debentures payable||||
|Long-term payables||||

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 Specific purpose account payable 2,073,957.30 2,607,427.30
|||||
|-|-|-|-|
|Contingent liabilities||11,310,523.59|14,041,361.41|
|Deferred tax liabilities||2,284,388.40|211,685.10|
|Other non-current liabilities||568,600.00|1,271,800.00|
|Subtotal of non-current liabilities||16,237,469.29|18,132,273.81|
|Total liabilities||4,688,197,995.08|4,153,162,367.16|
||Shareholders' Equity|||
|Share captial||632,487,764.00|632,487,764.00|
|Capital surplus||1,129,431,304.91|1,129,409,313.71|
|Less: Treasury Stock||||
|Reserve fund||||
|Surplus Reserves||290,958,368.49|270,617,248.93|
|General risk provision||||
|Undistributed profit||1,859,579,931.10|1,656,317,300.32|
|Foreign exchange difference||-3,559,713.76|-2,621,131.09|
|Owners' equity attributable to parent company||3,908,897,654.74|3,686,210,495.87|
|Minority interest||625,431,730.92|564,332,580.26|
|Total shareholders' equity||4,534,329,385.66|4,250,543,076.13|
|Total liabilities & shareholders' equity||9,222,527,380.74|8,403,705,443.29|

 Legal Person in charge Accounting
representative:Mr.Fang Hongbo of accounting: Mr. Zhang Zhaofeng Department leader:Zhong Fangliu 2. PARENT COMPANY BALANCE SHEET
Prepared by:WUXI LITTLE SWAN CO., LTD.
Unit: RMB yuan
|||||||
|-|-|-|-|-|-|
||Item||2013-12-31||2012-12-31|
||Current Assets:|||||
|Monetary fund||910,325,739.17||922,427,475.16||
|Trading financial assets||8,727,740.00||1,003,870.00||
|Notes receivable||1,541,082,811.22||1,630,477,941.72||
|Accounts receivable||731,446,199.69||315,755,445.34||
|Prepayment||56,620,106.39||56,491,157.88||
|Interest receivable||||||
|Dividend receivable||||||
|Other Receivables||18,752,200.83||14,097,542.06||
|Inventory||543,401,541.27||595,440,128.45||
|Non-current assets due within 1 year||||||
|Other current assets||939,664,538.10||510,244,753.07||
|Subtotal of current assets||4,750,020,876.67||4,045,938,313.68||
||Non-current Assets|||||
|Sellable financial asset||312,816.00||286,944.00||
|Expired investment in possess||||||
|Long-term receivables||||||

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 Long-term equity investment 1,601,723,640.45 1,669,439,929.87
|||||
|-|-|-|-|
|Investment real estate||9,466,777.10|5,049,500.73|
|Fixed assets||568,924,123.24|599,765,994.35|
|Construction in progress||||
|Construction materials||||
|Disposal of fixed assets||||
|Capitalized biological assets||||
|Oil-gas assets||||
|Intangible assets||101,069,007.28|106,918,898.60|
|Development expenditure||||
|Good will||||
|Long-term deferred expenses||6,781,326.79|26,516,523.53|
|Deferred tax assets||119,667,809.75|65,508,358.77|
|Other non-current assets||||
|Subtotal of non-current assets||2,407,945,500.61|2,473,486,149.85|
|Total assets||7,157,966,377.28|6,519,424,463.53|
||Current Liabilities:|||
|Short-term loans||||
|Financial liabilities||||
|Notes payable||273,399,760.34|557,839,790.34|
|Accounts payable||1,766,585,288.21|1,340,509,488.90|
|Advances from the customers||724,228,146.67|540,385,145.87|
|Employees’ wage payable||118,237,120.06|38,376,269.86|
|Taxes payable||156,722,107.53|15,517,733.11|
|Interests payable||||
|Dividends payable||3,740,152.33|3,710,206.21|
|Other payables||208,682,591.14|130,963,937.18|
|Non-current liabilities duewithin 1 year||||
|Other current liabilities||||
|Subtotal of current liabilities||3,251,595,166.28|2,627,302,571.47|
||Non-current Liabilities:|||
|Long-term loans||||
|Debentures payable||||
|Long-term payables||||
|Specific purpose account payable||||
|Contingent liabilities||||
|Deferred tax liabilities||1,341,038.40|178,577.10|
|Other non-current liabilities|||600,000.00|
|Subtotal of non-current liabilities||1,341,038.40|778,577.10|
|Total liabilities||3,252,936,204.68|2,628,081,148.57|
||Shareholders' Equity|||
|Share captial||632,487,764.00|632,487,764.00|
|Capital surplus||1,291,483,360.14|1,291,461,368.94|
|Less: Treasury Stock||||

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 Reserve fund
||||
|-|-|-|
|Surplus Reserves|278,308,224.59|257,967,105.03|
|General risk provision|||
|Undistributed profit|1,702,750,823.87|1,709,427,076.99|
|Foreign exchange difference|||
|Owners' equity attributable to parent company|3,905,030,172.60|3,891,343,314.96|
|Minority interest|||
|Total shareholders' equity|3,905,030,172.60|3,891,343,314.96|
|Total liabilities & shareholders' equity|7,157,966,377.28|6,519,424,463.53|

 Legal Person in charge Accounting
representative:Mr.Fang Hongbo of accounting: Mr. Zhang Zhaofeng Department leader:Zhong Fangliu 3. CONSOLIDATED INCOME STATEMENT
Prepared by:WUXI LITTLE SWAN CO., LTD.
Unit: RMB yuan
||||
|-|-|-|
|Item|2013|2012|
|Ⅰ.Total Sales|8,727,956,044.37|6,899,863,926.81|
|Including: Sales|8,727,956,044.37|6,899,863,926.81|
|Interests income|||
|Insurance fee earned|||
|Premium charges and commission income|||
|II.Total Cost|8,337,167,801.38|6,547,962,736.57|
|Including: Cost of goods sold|6,549,621,939.90|5,339,914,557.98|
|Interests expenses|||
|Handling charges and commission expenses|||
|Insurance discharge payment|||
|Net claim amount paid|||
|Net insurance policy reserves provided|||
|Insurance policy dividend paid|||
|Reinsurance expenses|||
|Taxes and associate charges|53,002,629.99|30,481,840.17|
|Selling and distribution expenses|1,267,118,417.20|840,560,482.53|
|Administrative expenses|393,481,200.80|331,386,860.96|
|Financial expenses|24,609,694.16|-3,052,363.24|
|Impairment loss|49,333,919.33|8,671,358.17|
|Add: gain/(loss) from change in fair value (“-” means loss)|13,792,150.00|-3,067,710.00|
|Investment income (“-” means loss)|116,861,930.20|55,622,690.40|
|Including: income from investment onaffiliated enterprise and joint enterprise|-116,701.92|-143,000.95|
|Foreign exchange difference (“-” means loss)|||
|III. Business profit (“-” means loss)|521,442,323.19|404,456,170.64|
|Plus: non-operation income|40,374,853.39|52,003,988.56|
|Less: non- operation expense|13,195,868.57|10,888,538.79|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 Including: loss from non-current asset disposal 3,962,772.35 5,461,998.05
||||
|-|-|-|
|IV. Total profit (“-” means loss)|548,621,308.01|445,571,620.41|
|Less: Tax expense|73,863,608.22|66,735,452.95|
|V. Net profit (“-” means loss)|474,757,699.79|378,836,167.46|
|Attributable to parent company|413,350,079.54|338,387,680.99|
|Minority interest|61,407,620.25|40,448,486.47|
|VI. Earnings per share|||
|(I) basic earnings per share|0.65|0.54|
|(II) diluted earnings per share|0.65|0.54|
|VII. Other misc. incomes|-916,591.47|-74,569.77|
|VIII. Total of misc. incomes|473,841,108.32|378,761,597.69|
|Attributable to owners of parent company|412,433,488.07|338,313,111.22|
|Minority interest|61,407,620.25|40,448,486.47|

 Legal Person in charge Accounting
representative:Mr.Fang Hongbo of accounting: Mr. Zhang Zhaofeng Department leader:Zhong Fangliu 4. PARENT COMPANY INCOME STATEMENT
Prepared by:WUXI LITTLE SWAN CO., LTD.
Unit: RMB yuan
||||
|-|-|-|
|Item|2013|2012|
|Ⅰ.Total Sales|6,342,297,557.91|4,472,527,414.69|
|less: Cost of goods sold|6,342,297,557.91|3,374,118,170.00|
|Taxes and associate charges|38,666,878.02|23,755,294.31|
|Selling and distribution expenses|940,158,466.34|608,958,098.56|
|Administrative expenses|254,025,133.09|207,303,445.99|
|Financial expenses|10,450,667.44|-4,465,928.87|
|Impairment loss|96,662,671.60|78,550,923.12|
|Add: gain/(loss) from change in fair value (“-” means loss)|7,723,870.00|-1,664,430.00|
|Investment income (“-” means loss)|76,201,988.21|42,078,035.42|
|Including: income from investment onaffiliated enterprise and joint enterprise|-116,701.92|-143,000.95|
|Foreign exchange difference (“-” means loss)|||
|II. Business profit (“-” means loss)|244,035,218.38|224,721,017.00|
|Plus: non-operation income|16,563,125.26|29,384,659.07|
|Less: non- operation expense|8,414,234.79|7,117,850.45|
|Including: loss from non-current asset disposal|548,024.58|2,425,340.62|
|III. Total profit (“-” means loss)|252,184,108.85|246,987,825.62|
|Less: Tax expense|48,772,913.21|35,154,459.11|
|IV. Net profit (“-” means loss)|203,411,195.64|211,833,366.51|
|V. Earnings per share|||
|(I) basic earnings per share|0.32|0.33|
|(II) diluted earnings per share|0.32|0.33|
|VI. Other misc. incomes|21,991.20|1,999.20|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 VII. Total of misc. incomes 203,433,186.84 211,835,365.71 Legal Person in charge Accounting
representative:Mr.Fang Hongbo of accounting: Mr. Zhang Zhaofeng Department leader:Zhong Fangliu 5. CONSOLIDATED STATEMENT OF CASH FLOWS
Prepared by:WUXI LITTLE SWAN CO., LTD.
Unit: RMB yuan
||||
|-|-|-|
|Item|2013|2012|
|I. Cash flow from business operation|||
|Cash received from sales of products and providing of services|7,152,993,865.17|6,857,898,811.46|
|Tax returned|108,549,026.13|176,923,799.52|
|Other cash received from business operation|51,806,677.27|48,968,092.61|
|Sub-total of cash inflow from business activities|7,313,349,568.57|7,083,790,703.59|
|Cash paid for purchasing of merchandise and services|4,150,047,174.80|4,827,830,777.79|
|Cash paid to staff or paid for staff|626,533,856.58|515,778,563.34|
|Taxes paid|416,449,377.95|347,521,146.71|
|Other cash paid for business activities|1,215,437,058.23|1,047,902,517.60|
|Sub-total of cash outflow from business activities|6,408,467,467.56|6,739,033,005.44|
|Net cash flow from business operation|904,882,101.01|344,757,698.15|
|II. Cash flow generated by investment|||
|Cash received from investment retrieving|11,187,730,000.00|10,539,392,774.02|
|Cash received as investment gains|116,670,162.53|7,124,030.24|
|Net cash received from disposal of fixed assets, intangible assets,and other long-term assets|100,768,702.18|8,960,865.26|
|Net cash received from disposal of subsidiaries or other operationalunits|||
|Other investment-related cash received|||
|Sub-total of cash inflow due to investment activities|11,405,168,864.71|10,555,477,669.52|
|Cash paid for construction of fixed assets, intangible assets and otherlong-term assets|59,527,350.44|91,407,867.77|
|Cash paid as investment|11,794,790,000.00|11,662,691,112.91|
|Net cash received from subsidiaries and other operational units|||
|Other cash paid for investment activities|||
|Sub-total of cash outflow due to investment activities|11,854,317,350.44|11,754,098,980.68|
|Net cash flow generated by investment|-449,148,485.73|-1,198,621,311.16|
|III. Cash flow generated by financing|||
|Cash received as investment|||
|Cash received as loans|||
|Other financing-related cash received|||
|Sub-total of cash inflow from financing activities|||

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 Cash to repay debts 6,961,486.36
||||
|-|-|-|
|Cash paid as dividend, profit, or interests|189,716,383.08|125,625,417.23|
|Other cash paid for financing activities|||
|Sub-total of cash outflow due to financing activities|189,716,383.08|132,586,903.59|
|Net cash flow generated by financing|-189,716,383.08|-132,586,903.59|
|IV. Influence of exchange rate alternation on cash and cashequivalents|-938,582.67|-76,568.97|
|V. Net increase of cash and cash equivalents|265,078,649.53|-986,527,085.57|
|Plus: Balance of cash and cash equivalents at the beginning of term|1,293,126,217.00|2,279,653,302.57|
|VI. Balance of cash and cash equivalents at the end of term|1,558,204,866.53|1,293,126,217.00|

 Legal Person in charge Accounting
representative:Mr.Fang Hongbo of accounting: Mr. Zhang Zhaofeng Department leader:Zhong Fangliu 6. PARENT COMPANY STATEMENT OF CASH FLOWS
Prepared by:WUXI LITTLE SWAN CO., LTD.
Unit: RMB yuan
||||
|-|-|-|
|Item|2013|2012|
|I. Cash flow from business operation|||
|Cash received from sales of products and providing of services|3,790,868,852.78|4,657,331,213.12|
|Tax returned|29,881,889.63|34,588,385.08|
|Other cash received from business operation|25,210,647.68|24,755,557.75|
|Sub-total of cash inflow from business activities|3,845,961,390.09|4,716,675,155.95|
|Cash paid for purchasing of merchandise and services|1,785,821,502.14|3,430,866,856.14|
|Cash paid to staff or paid for staff|393,084,196.18|287,402,832.30|
|Taxes paid|295,325,601.66|267,304,047.74|
|Other cash paid for business activities|757,102,720.81|760,878,755.82|
|Sub-total of cash outflow from business activities|3,231,334,020.79|4,746,452,492.00|
|Net cash flow from business operation|614,627,369.30|-29,777,336.05|
|II. Cash flow generated by investment|||
|Cash received from investment retrieving|5,987,000,000.00|7,891,747,719.04|
|Cash received as investment gains|70,536,370.52|4,654,930.24|
|Net cash received from disposal of fixed assets, intangible assets, andother long-term assets|1,641,069.42|6,463,250.69|
|Net cash received from disposal of subsidiaries or other operationalunits|10,282,319.61||
|Other investment-related cash received|||
|Sub-total of cash inflow due to investment activities|6,069,459,759.55|7,902,865,899.97|
|Cash paid for construction of fixed assets, intangible assets and otherlong-term assets|34,215,273.55|27,553,240.00|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 Cash paid as investment 6,426,000,000.00 8,344,181,612.91
||||
|-|-|-|
|Net cash received from subsidiaries and other operational units|||
|Other cash paid for investment activities|||
|Sub-total of cash outflow due to investment activities|6,460,215,273.55|8,371,734,852.91|
|Net cash flow generated by investment|-390,755,514.00|-468,868,952.94|
|III. Cash flow generated by financing|||
|Cash received as investment|||
|Cash received as loans|||
|Other financing-related cash received|||
|Sub-total of cash inflow from financing activities|||
|Cash to repay debts|||
|Cash paid as dividend, profit, or interests|189,716,383.08|125,625,417.23|
|Other cash paid for financing activities|||
|Sub-total of cash outflow due to financing activities|189,716,383.08|125,625,417.23|
|Net cash flow generated by financing|-189,716,383.08|-125,625,417.23|
|IV. Influence of exchange rate alternation on cash and cashequivalents|||
|V. Net increase of cash and cash equivalents|34,155,472.22|-624,271,706.22|
|Plus: Balance of cash and cash equivalents at the beginning of term|848,257,647.96|1,472,529,354.18|
|VI. Balance of cash and cash equivalents at the end of term|882,413,120.18|848,257,647.96|

 Legal Person in charge Accounting
representative:Mr.Fang Hongbo of accounting: Mr. Zhang Zhaofeng Department leader:Zhong Fangliu 7. CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
Prepared by:WUXI LITTLE SWAN CO., LTD.
Unit: RMB yuan
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
|Items|Year 2013||||||||||
||Equity attributable to parent company||||||||Minority equity|Totalshareholders'equity|
||Capital paid in(or sharecapital)|Capital reserve|Less:Treasurystock|Specialreserves|Surplus reserve|Common riskprovision|Undistributedprofit|Others|||
|Ⅰ. Balance at the end of lastaccounting period|632,487,764.00|1,129,409,313.71|||270,617,248.93||1,656,317,300.32|-2,621,131.09|564,332,580.26|4,250,543,076.13|
|Add: 1. Changes of accountingpolicy|||||||||||
|2. Correction of errors inprevious period|||||||||||
|3.Others|||||||||||
|II. Balance at the beginning ofcurrent year|632,487,764.00|1,129,409,313.71|||270,617,248.93||1,656,317,300.32|-2,621,131.09|564,332,580.26|4,250,543,076.13|
|III. Changed in the current year("-"for decrease)||21,991.20|||20,341,119.56||203,262,630.78|-938,582.67|61,099,150.66|283,786,309.53|
|(Ⅰ).Net profit|||||||413,350,079.54||61,407,620.25|474,757,699.79|
|( Ⅱ).Other misc. income||21,991.20||||||-938,582.67||-916,591.47|
|Subtotal of (Ⅰ) and ( Ⅱ)||21,991.20|||||413,350,079.54|-938,582.67|61,407,620.25|473,841,108.32|
|( Ⅲ). Capital contributed bythe shareholders|||||||||-308,469.59|-308,469.59|
|1.New increase of capital fromshareholders in current year|||||||||||
|2.Amount of share paymentaccounted into shareholders'equity|||||||||||
|3. others|||||||||-308,469.59|-308,469.59|
|( Ⅳ). Profit distribution|||||20,341,119.56||-210,087,448.76|||-189,746,329.20|
|1. Providing of surplus reserves|||||20,341,119.56||-20,341,119.56||||
|2. Commonrisk provision|||||||||||
|3.Allotment to the owners (orshareholders)|||||||-189,746,329.20|||-189,746,329.20|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
|||||||||
|-|-|-|-|-|-|-|-|
|(V)Internal transferring ofowners’equity||||||||
|1. Capitalizing of capitalreserves (or to capital shares)||||||||
|2.Capitalizing of surplusreserves (or to capital shares)||||||||
|3. Surplus reserve make uplosses||||||||
|4. Others||||||||
|(VI)Special reserves||||||||
|1.Provided this year||||||||
|2.Used this year||||||||
|(VII)Others||||||||
|IV.Balance at the end of thisterm|632,487,764.00|1,129,431,304.91|290,958,368.49|1,859,579,931.10|-3,559,713.76|625,431,730.92|4,534,329,385.66|

Legal representative:Mr.Fang Hongbo Person in charge of accounting: Mr. Zhang Zhaofeng Accounting Department leader:Zhong Fangliu
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
|Items|Year 2012||||||||||
||Equity attributable to parent company||||||||Minority equity|Totalshareholders'equity|
||Capital paid in(or sharecapital)|Capital reserve|Less:Treasurystock|Specialreserves|Surplus reserve|Common riskprovision|Undistributedprofit|Others|||
|Ⅰ. Balance at the end of lastaccounting period|632,487,764.00|1,096,157,314.51|||249,433,912.28||1,465,610,508.78|-2,544,562.12|523,884,093.79|3,965,029,031.24|
|Add: 1. Changes of accountingpolicy|||||||||||
|2. Correction of errors inprevious period|||||||||||
|3.Others|||||||||||
|II. Balance at the beginning ofcurrent year|632,487,764.00|1,096,157,314.51|||249,433,912.28||1,465,610,508.78|-2,544,562.12|523,884,093.79|3,965,029,031.24|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
||||||||
|-|-|-|-|-|-|-|
||33,251,999.20|21,183,336.65|190,706,791.54|-76,568.97|40,448,486.47||
|(Ⅰ).Net profit|||338,387,680.99||40,448,486.47|378,836,167.46|
|( Ⅱ).Other misc. income|1,999.20|||-76,568.97||-74,569.77|
|Subtotal of (Ⅰ) and ( Ⅱ)|1,999.20||338,387,680.99|-76,568.97|40,448,486.47|378,761,597.69|
|( Ⅲ). Capital contributed bythe shareholders|33,250,000.00|||||33,250,000.00|
|1.New increase of capital fromshareholders in current year|||||||
|2.Amount of share paymentaccounted into shareholders'equity|33,250,000.00|||||33,250,000.00|
|3. others|||||||
|( Ⅳ). Profit distribution||21,183,336.65|-147,680,889.45|||-126,497,552.80|
|1.Providing of surplus reserves||21,183,336.65|-21,183,336.65||||
|2. Common risk provision|||||||
|3.Allotment to the owners (orshareholders)|||-126,497,552.80|||-126,497,552.80|
|4. Others|||||||
|(V)Internal transferring ofowners’equity|||||||
|1. Capitalizing of capitalreserves (or to capital shares)|||||||
|2.Capitalizing of surplusreserves (or to capital shares)|||||||
|3. Surplus reserve make uplosses|||||||
|4. Others|||||||
|(VI)Special reserves|||||||
|1.Provided this year|||||||
|2.Used this year|||||||
|(VII)Others|||||||

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
|||||||
|-|-|-|-|-|-|
|632,487,764.00|1,129,409,313.71|270,617,248.93|1,656,317,300.32|-2,621,131.09|564,332,580.26|

Legal representative:Mr.Fang Hongbo Person in charge of accounting: Mr. Zhang Zhaofeng Accounting Department leader:Zhong Fangliu 8. PARENT STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
Prepared by:WUXI LITTLE SWAN CO., LTD.
Unit: RMB yuan
|||||||||
|-|-|-|-|-|-|-|-|
|Items|Year 2013|||||||
||Capital paid in(or sharecapital)|Capital reserve|Less: Treasurystock|Specialreserves|Surplus reserve|Undistributedprofit|Total ofshareholders'equity|
|Ⅰ. Balance at the end of last accounting period|632,487,764.00|1,291,461,368.94|||257,967,105.03|1,709,427,076.99|3,891,343,314.96|
|Add: 1. Changes of accounting policy||||||||
|2. Correction of errors in previous period||||||||
|3.Others||||||||
|II. Balance at the beginning of current year|632,487,764.00|1,291,461,368.94|||257,967,105.03|1,709,427,076.99|3,891,343,314.96|
|III. Changed in the current year ("-"for decrease)||21,991.20|||20,341,119.56|-6,676,253.12|13,686,857.64|
|(Ⅰ).Net profit||||||203,411,195.64|203,411,195.64|
|( Ⅱ).Other misc. income||21,991.20|||||21,991.20|
|Subtotal of (Ⅰ) and ( Ⅱ)||21,991.20||||203,411,195.64|203,433,186.84|
|( Ⅲ). Capital contributed by the shareholders||||||||
|1.New increase of capital from shareholders in current year||||||||
|2.Amount of share payment accounted into shareholders'equity||||||||
|3. others||||||||
|( Ⅳ). Profit distribution|||||20,341,119.56|-210,087,448.76|-189,746,329.20|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
|||||||
|-|-|-|-|-|-|
|1. Providing of surplus reserves|||20,341,119.56|-20,341,119.56||
|2. Common risk provision||||||
|3.Allotment to the owners (or shareholders)||||-189,746,329.20|-189,746,329.20|
|4. Others||||||
|(V)Internal transferring of owners’equity||||||
|1. Capitalizing of capital reserves (or to capital shares)||||||
|2.Capitalizing of surplus reserves (or to capital shares)||||||
|3. Surplus reserve make up losses||||||
|4. Others||||||
|(VI)Special reserves||||||
|1.Provided this year||||||
|2.Used this year||||||
|(VII)Others||||||
|IV.Balance at the end of this term|632,487,764.00|1,291,483,360.14|278,308,224.59|1,702,750,823.87|3,905,030,172.60|

 Legal representative:Mr.Fang Hongbo Person in charge of accounting: Mr. Zhang Zhaofeng Accounting Department leader:Zhong Fangliu
|||||||||
|-|-|-|-|-|-|-|-|
|Items|Year 2012|||||||
||Capital paid in(or sharecapital)|Capital reserve|Less: Treasurystock|Specialreserves|Surplus reserve|Undistributedprofit|Total ofshareholders'equity|
|Ⅰ. Balance at the end of last accounting period|632,487,764.00|1,258,209,369.74|||236,783,768.38|1,645,274,599.93|3,772,755,502.05|
|Add: 1. Changes of accounting policy||||||||
|2. Correction of errors in previous period||||||||

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
|||||||
|-|-|-|-|-|-|
|3.Others||||||
|II. Balance at the beginning of current year|632,487,764.00|1,258,209,369.74|236,783,768.38|1,645,274,599.93|3,772,755,502.05|
|III. Changed in the current year ("-"for decrease)||33,251,999.20|21,183,336.65|64,152,477.06|118,587,812.91|
|(Ⅰ).Net profit||||211,833,366.51|211,833,366.51|
|( Ⅱ).Other misc. income||1,999.20|||1,999.20|
|Subtotal of (Ⅰ) and ( Ⅱ)||1,999.20||211,833,366.51|211,835,365.71|
|( Ⅲ). Capital contributed by the shareholders||33,250,000.00|||33,250,000.00|
|1.New increase of capital from shareholders in current year||||||
|2.Amount of share payment accounted into shareholders'equity||33,250,000.00|||33,250,000.00|
|3. others||||||
|( Ⅳ). Profit distribution|||21,183,336.65|-147,680,889.45|-126,497,552.80|
|1. Providing of surplusreserves|||21,183,336.65|-21,183,336.65||
|2. Common riskprovision||||||
|3.Allotment to the owners (or shareholders)||||-126,497,552.80|-126,497,552.80|
|4. Others||||||
|(V)Internal transferring of owners’equity||||||
|1. Capitalizing of capital reserves (or to capital shares)||||||
|2.Capitalizing of surplus reserves (or to capital shares)||||||
|3. Surplus reserve make up losses||||||
|4. Others||||||
|(VI)Special reserves||||||
|1.Provided this year||||||
|2.Used this year||||||

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
|||||||
|-|-|-|-|-|-|
|(VII)Others||||||
|IV.Balance at the end of this term|632,487,764.00|1,291,461,368.94|257,967,105.03|1,709,427,076.99|3,891,343,314.96|

 Legal representative:Mr.Fang Hongbo Person in charge of accounting: Mr. Zhang Zhaofeng Accounting Department leader:Zhong Fangliu
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 NoteIII Corporate information
Wuxi Little Swan Co., Ltd (hereinafter referred to as‘TheCompany’) was formerly a SOE founded and reorganized as a Private Placement Limited liability Company by the approval of Jiangsu State Commission for restructuring (License (1993) 253). By the approval of Jiangsu Municipal Government (License (1996) 52), State Council Securities Regulatory Commission (License (1996) 14), Shenzhen Securities and Exchange Commission (License (1996) 4), the company issued 70 million public shares and reorganized into a public company. The public offering raised fund of 310 million Yuan and the company was listed in Shenzhen Stock Exchange in July 1996. B-Stock Abbreviation is‘Little SwanB’. B-Stock Code is 200418.
The company publicly offered 60 million Common Stock (RMB Denominated) (including 90 million employee stocks) on the net value of asset. The Stock issued under the approval of China Securities Regulatory Commission (License (1996) 54 55). The public offerings raised fund of 720.83 million Yuan and the company was listed in Shenzhen Stock Exchange in Mar 1997. A-Stock Abbreviation is‘Little SwanA’. A-Stock Code is 000418. The company regulated its shareholder structure on August 7, 2006: The Holding Shareholder of records on the registration date of the Solution have the right to exchange on the consideration of 10 floating shares for 2.5 shares held by non-floating shareholders. The total consideration consisted of 18 million non-floating shares. Non-floating shareholders then obtained the access to outstanding shares.
According to the Resolution of shareholder meeting, 2007: New registered capital totals to 182.55192 million Yuan, consisting of 182.55192 million share capital transferred from capital public reserves. The new share capital is transferred based on 365.10384 million shares at the end of Year 2007, every 10 shares for 5 new shares. According to the 4th Session of the 6th Board meeting and the 1st Temporary Meeting Of Shareholders in 2010, approved by China Securities Regulatory Commission (SFC license[2010] 1577), the company offer a private share placement of 84,832,004 A shares for69.47% of the shares of Hefei Midea Washing Machine Co., Ltd, formerly as Hefei Royal star Washing Machine Manufacture Co., Ltd., from its shareholder Guangdong Midea Electric Appliances Co., Ltd. For par value of 1 Yuan per share, issuing price of 8.63 Yuan per share. This issuance increased thecompany’s share capital by 84.832004 million Yuan.
After the merger and acquisition of Guangdong Midea Electric Appliances Co., Ltd approved by China Securities Regulatory Commission (License (2013) 1014), Midea Group Co., Ltd now hold share volume of equities formerly held by Guangdong Midea Electric Appliances Co., Ltd. Transfer procedures for shareholdings' movements is completed by 31 Dec, 2013.
By the date of 31 Dec, 2013, the registered capital of the company is 632.487764 million shares,0.583% of which are 3.68989 million floating A-shares with trading limited conditions,69.213% of which are 437.762002 million floating A-shares,30.204% of which are 191.035872 million B-shares.
Company profile
Place of Registration: No. 18 Changjiang South Road, National High-tech Industrial Development Zone, Wuxi Business Address: No. 18, Changjiang South Road, Wuxi, Jiangsu Province
Form of Organization: Limited Liability Company
Operations and business scope of the Company
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 Business scope: manufacture, sales and after-sales service of household electrical appliances, industrial ceramic products, environmental-friendly dry cleaning equipment, washing apparatus for typical machines, processing equipment and fittings. The company provide laundry service, machining, exporting, or be agent for exporting a variety of products and technologies. (Excluding unqualified or forbidden products and technologies for operation according to state regulations to Enterprise) It also provide appliance technical service, qualified outsourcing service.
Name of the holding company
The holding company of the company: Midea Group Co., Ltd
The Ultimate Controller of the company: He Xiangjian.
Authorization and date of issuing the financial statements
The financial statements were approved and authorized for issue by the board of directors on the date of March 5th, 2014.
Note IV Summary of Main Accounting Policies and Accounting Estimate
1. Preparation basis of the financial statements
The company recognizes and measures transactions occurred according to Chinese Accounting Standards– Basic standard and other related accounting standards, prepares the financial statements based on accrual accounting and the underlying assumption of going concern.
2. Statement of compliance with Enterprise accounting standards
The financial statements of the company comply with the requirements of Accounting Standards; the company's financial position, operating results, cash flows and other relevant information are truly and completely disclosed in the financial statements.
3. Accounting period
The company's accounting year is from 1st January to 31st December for each calendar year.
4. Recording currency
The recording currency of the company is Renminbi
5. Accounting processing method of business combination under common control and not under common control
(1) The business combinations which are under common control
The assets and liabilities that the combining party obtains in a business combination shall be measured on the
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 basis of their carrying amount in the combined party on the combining date. As for the balance between the carrying amount of the net assets obtained by the combining party and the carrying amount of the consideration paid by it (or the total par value of the shares issued), the additional paid-in capital shall be adjusted. If the additional paid-in capital is not sufficient to be offset, the retained earnings shall be adjusted. The direct cost for the business combination of the combining party shall, including the expenses for audit, assessment and legal services, be recorded into the profits and losses at the current period. However, the handling fees, commissions and other expenses for the issuance of equity securities or bonds for the business combination shall be recorded into the amount of initial measurement of the equity securities or the bonds.
(2) The business combinations which are not under common control
The acquirer shall recognize the initial cost of combination under the following principles:
a) The cost of a business combination which are not under common control is the aggregate of the fair values, at the date of exchange, of assets given, liabilities incurred or assumed, and equity securities issued by the acquirer, in exchange for control of the acquiree. The direct cost for the business combination of the combining party shall, including the expenses for audit, assessment and legal services, be recorded into the profits and losses at the current period.
b) The acquirer shall recognize the difference that the combination costs are over the fair value of the identifiable net assets obtained from acquiree as goodwill; if the combination costs are less than the fair value of the identifiable net assets obtained from acquiree, the acquirer shall reexamine the measurement of the fair values of the identifiable assets, liabilities and contingent liabilities obtained from the acquiree as well as the combination costs; and then after the reexamination, the result is still the same, the difference shall be recorded in the profit and loss of the current period.
6. Preparation method of consolidated financial statements
(1) Determination of consolidation scope
The combination scope of the consolidated financial statement will be determined on the basis of the control. The consolidated financial statements will be subject to the No. 33 Enterprise Accounting Standards
–Consolidated Financial Statement that was issued in February 2006. In preparing the consolidated financial statements, all key accounts and transactions between the company and subcompanies, subcompanies and subcompanies will be offset. The net assets of merged subcompanies that are attributable to the minority of shareholder equities will be separately listed in the shareholder equities of consolidated financial statements. In case the accounting policies and accounting periods of subcompanies differ from those of parent company, the financial statements of subcompanies will be adjusted.
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 7. Cash and cash equivalent
For the purposes of the cash flow statement, cash refers to all cash in hand and all deposits which are readily available for payment. Cash equivalents refer to short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.
8. Foreign currency transactions and translations
All foreign currency transactions during the period have been translated in to RMB at the spot exchange rate of the transaction date. The foreign currency conversions and any transactions involved foreign currency conversions have been translated in to RMB at the actually used exchange rate during the transaction process.
On the balance sheet date, the company treats the foreign currency monetary items and foreign currency non-monetary items according to the following provisions:
(1)The foreign currency monetary assets and liabilities items have been translated at the spot exchange rate on the balance sheet date. The exchange difference arising from the difference between the spot exchange rate on the balance sheet date and the spot exchange rate at the time of initial recognition or prior to the balance sheet date shall be recorded in the profits and losses in the current period, except for those attributable to foreign currency borrowings that have been taken out specifically for the construction of fixed assets, which are capitalized as part of fixed assets' costs.
(2)A foreign currency non-monetary item measured at the historical costs shall still be translated at the spot exchange rate on the transaction date, of which the amount of functional currency shall not be changed; the foreign currency non-monetary items measured at their fair values have been translated at the spot exchange rate on the balance sheet date, the exchange difference arising from the difference between the spot exchange rate on the balance sheet date and the spot exchange rate at the time of initial recognition or prior to the balance sheet date shall be recorded in changes in fair value gains and losses of the current period.
The asset and liability items in the balance sheet about the overseas businesses of the company have been translated at the spot exchange rate on the balance sheet date. Among theowner’s equity items, except for the items as “undistributed profits”, other items have been translated at the spot exchange rate at the time when they are incurred. The income and expense items in the profit statement have been translated at an exchange rate which is approximate to the spot exchange rate of the transaction date. The differences arising from the translation of foreign currency financial statements in compliance with the aforesaid items have been presented separately under theowner’s equities of the balance sheets. Foreign currency cash flows and the cash flows of foreign subsidiaries have been translated at an exchange rate which is approximate to the spot exchange rate at the time when the cash flows incurred. The differences arising from fluctuations in exchange have been presented separately in the statement of cash flows.
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 9. Financial instruments
(1) Classification and measurement of financial assets and financial liabilities
Based on the investment purpose and economic essence, the company classifies the financial assets into the following four categories:
a) transactional financial assets, which are measured at fair value with variations of fair value accounted into current income account;
b) financial assets available for sale, which are measured at fair value with the variations accounted into
shareholders' equity;
c) account receivables measured at the post-amortization costs; and
d) held-to-maturity investments, which are also measured at the costs.
The company has divided its financial liabilities into one category measured at fair value with variations accounted into current profit and loss and another category measured at the post-amortization costs.
(2) Recognition of the fair value of financial assets and liabilities.
When there is an active market for the financial instrument, the quoted prices for the financial assets the company holds or the financial liabilities it plans to assume shall be the present actual offer, while the quoted prices for the financial assets the company plans to acquire or the financial liabilities it has assumed shall be the available charge.
When thereisn’t any active market, fair value will be recognized by evaluation techniques. Evaluation techniques include referencing to the prices adopted in latest voluntary transaction between parties with full understanding of the situation, referencing to the current fair value of other substantially similar financial instruments and other evaluation techniques.
(3) Recognition and measurement of finance asset transferring
The term "transfer of a financial asset" refers to thecompany’s (the transferor's) transferring or delivering a financial asset to a party other than the issuer of the financial asset (the transferee). Transfer of a financial asset could be the whole asset or part of it. It includes the following two cases:
a) The company transfers the right to another party for receiving the cash flow of the financial asset; and;
b) The company transfers the financial asset to another party, but maintains the right to receive the cash flow of the financial asset and undertakes the obligation to pay the cash flow it receives to the final recipient.
Where the company has transferred nearly all of the risks and rewards related to the ownership of the financial asset or part of this asset to the transferee, it shall stop recognizing the financial asset or part of this asset. The difference arising from the sum of consideration received from the transfer and the book value of this asset should be accounted into the profit and loss. If it retained nearly all of the risks and rewards related to the ownership of the financial asset, it shall not stop recognizing the financial asset.
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 (4) Impairment testing on financial assets, providing of impairment provision
At balance sheet date, the Company performs testing on the book value of financial assets other than those measured by fair value and changes accounted into current income account.
10. Accounts Receivable
(1) Individually significant accounts receivable on which the bad debt provisions are provided individually
|||
|-|-|
|Standards of the individually significantaccounts receivable|The accounts receivable whose individual amount accounts forover 10% (including 10%) of accounts receivable balance at theend of this period or amount of the individual account receivablewhich is greater than RMB 10 millions (and including 10 millions);Standards of the individually significant other receivable: the otherreceivable whose individual amount accounts for over 10%(including 10%) of other receivables balance at the end of thisperiod or amount of the individual other receivable which is greaterthan RMB 5 millions (and including 5 millions).|
|Providing method for bad debt provisions ofindividually significant receivables|For the individually significant receivables, the impairment test iscarried on individually; the Company provides provision forimpairment loss for the amount which is measured as thedifference between the asset's carrying amount and the presentvalue of estimated future cash flows.|

(2) Accounts receivable on which the bad debt provisions are provided by combinations
||||
|-|-|-|
|Combinations|Providing method forbad debt provisions ofaccountants receivablesby combinations|Basis for recognition of Combination|
|||For the receivables which are not individually|
|||significant, as well as the individually tested receivables|
|||which the test has not recognize any impairment loss,|
|Combination 1：Accountants|||
|||the company categorizes them according to their age|
|receivable categorized|Aging methods||
|||and provides the bad debt reserve for these receivables|
|according to their age|||
|||in different proportions to the closing balance of each|
|||category.|
||When the test has not||
|Combination 2 ： Accounts|recognize any||
||impairment loss, the||
|receivables in the scope of||Accountant receivables of subsidiaries in the|
||company does not||
|combination statements|provide bad debt|combination scope|
||provision for||
||receivables of||

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
||
|-|
|subsidiaries in the|
|combination scope.|

For combinations which bad debt provisions of accountant receivables are provided by aging method:
||||
|-|-|-|
|Aging|Provision rate for AccountsReceivable（%）|Provision rate for Other Receivables（%）|
|Within 1 year|5|5|
|From 1-2 years|10|10|
|From 2-3 years|20|20|
|From 3-5 years|60|60|
|Over 5 years|100|100|

(3) Accounts receivable which are not individually significant, but still the bad debt provisions are provided individually
|||
|-|-|
|Reasons for providing the bad debtprovisions individually for receivableswhich are not individually significant|The receivables are not individually significant, but are assessed at highrisk level through credit risk combination. Confirmation of credit riskcharacteristics’ combination: the receivables which are involved inpending lawsuits or dissolution of the debtor company, and thereceivables with the age of over 3years (excluding the individuallysignificant receivables).|
|Providing method for bad debtprovisions|For the receivables which are not individually significant, but which areassessed at high risk level through credit risk combination, theimpairment test is carried on individually, the company providesprovision for impairment loss for the amount which is measured as thedifference between the asset's carrying amount and the present value ofestimated future cash flows.|

11. Inventories
(1) Categorizing of inventories
Inventories are those under theCompany’s possession for the purpose of selling, in the process of production, or materials and goods used in production process or providing of services, including materials purchased, raw materials, low-value consumables, products in process, semi-finished goods, stock merchandises (finished goods) and consigned goods.
(2) Pricing of delivering inventory
Inventories are measured at cost when procured, including purchase cost, processing cost, and other costs. Actual costs are recognized at weight average when delivered.
(3) Recognition of inventory realizable value and providing of impairment provision
On the balance sheet date, inventories are accounted depending on which is lower between the cost and the net
realisable value. At overall verification of inventories at the end of year, when the net realisable value is lower
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 than the cost, provisions for impairment of inventories shall be drawn. Provisions for impairment of inventories shall be accounted according to the difference between the cost of individual inventory items and the net realisable value. Including: for inventories such as finished products or materials which will be directly sold, in the normal operation, the realizable net value will be the balance of estimated selling price less sales expenses and relative taxations; for those inventories need further processing, in the normal operation, the realizable net value will be the balance of estimated sales price less costs to make it finished, less estimated sales expenses, and less relative taxation. At the balance sheet day, inventories with contract prices will be determined for realizable value separately from those without contract prices.
Where certain items of inventory have similar purposes or end uses and relate to the same product line produced and marketed in the same geographical area, and therefore cannot be practicably evaluated separately from other items in that product line, costs and net realisable values of those items may be determined on an aggregate basis. For large quantity and low value items of inventories, cost and net realisable value are determined based on categories of inventories.
(4) Inventory system
The Company uses perpetual inventory system. Inventories are checked periodically and the gains and losses from inventory checking are accounted into current gain/loss account.
(5) Amortizing of low-value consumables and packaging materials
Low-value consumables and packaging materials are amortized on on-off amortization basis at using.
12. Long-term share equity investment
（1）Recognition of initial investment costs
Investments of the Company in subsidiaries are valued at investment costs. For long-term share equity investment formed by shareholding and merger please see Note II(V). Retrospective or retrieved investments are adjusted to the cost of long term equity investment.
For long-term equity investment of the Company with or without common control or major influence on the investee, and there is no quotation in an active market, and the fair value is not reliably measured, values are on initial investment costs.
（2）Subsequent measurement and recognition of gain/loss
The Company uses cost basis in subsequent measurement of investment in subsidiaries, and adjusted on equity basis when preparing the consolidated financial statement. Except for the announced cash dividend or profit included in the practical cost or price when the investment was made, the investment gains are recognized at the announced cash dividend or profit distribution.
Subsequent measurement of long-term equity investment in investees under common control or significant influence is on equity basis. When the initial investment cost is larger than the share of fair value of net asset, the initial cost of long-term equity investment shall not be adjusted. When the initial investment cost is lower than the
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 share of fair value of net asset, the balance share be accounted into current gain/loss, and the long-term investment cost shall be adjusted meanwhile.
After obtaining of the long-term equity investment, the investment gain/loss is recognized according to the share of the net gain/loss realized by the invested company, and the book value of the long-term equity investment shall be adjusted accordingly. The share of profit distributions or cash dividends announced by the invested company is used to reduce the book value of the long-term equity investment.
If the Company has no common control or significant influence on the investee, also there is no quotation in an active market, and the fair value of the long-term investment is not able to be reliably measured, the subsequent measurement shall be on cost basis.
（3）Basis of recognizing common control and significant influence
Common control is the mutual control of investors over an economic action basing on a contract, only effective when it is agreed by all of the investors who have the share of control on the financial and business control power. When the investors hold common control over the investee, the investee is regarded as their affiliate.
Significant influences mean an entity has the power to participate in the decision making of another, but cannot dominate individually or jointly with other parties. When the investor may significantly influence the investee, the investee is regarded as the affiliate.
（4） Impairment examination and providing of impairment provision
At the balance sheet day, if evidence showing that impairment occurred on the long-term equity investment, the recoverable amount shall be decided by the higher one of net amount of fair value less disposal fees and the current value of predicted future cash flow. When the recoverable amount of the long-term equity investment is lower than the book value, the book value will be reduced down to the recoverable amount, the reduced amount is recognized as asset impairment loss and counted into current gain/loss account, asset impairment provision shall be provided accordingly.
Once the long-term equity investment impairment loss is recognized, it will not be written back in following fiscal terms, excluding sellable financial assets, whose impairment provision can be written back through equity accounts.
13. Investment real estate
Investment real estate is measured according to the initial cost. Cost of real estate purchased from outside includes purchasing price, tax, and other expenses directly related to the real estate; cost of real estate constructed by the Company itself is composed of the essential costs to make the real estate usable. Investment properties invested by investors are booked at the value according to the investment contract, whereas when the contract value is not fairly acceptable, it will be booked at the fair value.
The Company employs the cost mode to calculate the investment properties and adopts straight-line method in depreciation and amortization of investment properties, among which, period of depreciation for the buildings
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 is 20 years (the lower one of Statutory useful life and estimated useful life) , and period of amortization for land is 50 years (Statutory useful life ).
Providing of impairment provisions for investment properties is in accordance with impairment providing of fixed assets.
14. Fixed assets
(1) Conditions for fixed asset recognition
Fixed assets are defined as the tangible assets which are held for the purpose of producing goods, providing services, leasing or for operation& management, and have more than one year of service life.
Other than the fixed assets which have already been provided depreciations in full but still in use, the Company provides depreciations upon all of the fixed assets. Straight-line method is adopted by the Company in depreciation.
(2)Categories, useful life, predicted salvage value, and annual depreciation rate of fixed assets are as the followings:
|||||
|-|-|-|-|
|Categories|Useful life|Salvage value|Annual depreciation ratio|
|Plant & buildings|30-40 years|5%|2.38-3.17%|
|Machinery equipment|10-18 years|5%|5.28-9.50%|
|Electric equipment|3-8 years|5%|11.88-31.67%|
|Transportation vehicles|4-12 years|5%|7.92-23.75%|
|Others|5-8 years|5%|11.88-19%|

（3）Impairment testing and impairment provisions
At the balance sheet day, fixed assets are accounted at the lower one of book value and retrievable value. If the retrievable value is lower than the book value, the book value will be deducted to the retrievable value, and the deducted amount will be recorded as asset impairment loss into current income account, and impairment provision shall be provided accordingly. Once the impairment loss was recognized, it will not be written back in coming fiscal terms.
It suggests that a fix asset may be impaired if there are any of the following indications and retrievable value of this asset needs to be calculated for impairment testing:
a) during the period, a fix asset's market value has declined significantly more than it would be expected as a result of the passage of time or normal use during the current period;
b) evidence is available of obsolescence or physical damage of an asset;
c) significant changes with an adverse effect on the predicted usage mode of the fixed assets have taken place. The
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 asset becomes idle, or the Company plans to discontinue or to dispose of an asset before the previously expected date, which will cause negative effect on the Company.
d) significant changes with an adverse effect on the Company have taken place during the period, or will take place in the near future, in the technological, market, economic or legal environment in which the Company operates or in the market to which an asset is dedicated;
e) market interest rates or other market rates of return on investments have increased during the period, and those increases are likely to affect the discount rate used by the company in calculating an asset's present value by predicted future cash flows, and decrease the asset's recoverable amount materially;
f) evidence is available from internal reporting that indicates that the economic performance of an asset is, or will be, worse than expected, for example, the net cash flow generated from fixed assets or the operating profit (or loss) realized by fixed assets is lower (higher) than the excepted amount, etc.; and
g) Other evidence indicates that fixed assets may be impaired.
(4) Recognition and measurement of fixed assets acquired under finance lease
The Company identifies a lease of asset as finance lease when it satisfies the following one or several conditions:① The Company gains ownership of the asset at the end of the lease period.
② The lease contains a bargain purchase option to buy the equipment at less than fair market value, thus it could be predicted that the Company will exercise this option.
③ Even though the Company will not gain ownership of the asset, the life of the lease is75% or greater of theasset’s useful life.
④ The present value of lease payments is greater than90% of the asset's fair value on the date of lease.⑤ The asset for lease is special and it can only be used by the Company unless it is extensively modified. A fixed asset acquired under finance lease shall be valued at the lower of the fair value of the leased asset and the present value of the minimum lease payments at the inception of lease.
The depreciation method of fixed assets acquired under finance lease is consistent with that for depreciable assets owned by the Company. If the Company can reasonably confirm that it will obtain the ownership of leased asset at the end of lease term, the leased asset shall be depreciated during the useful life of the leased asset. If the Company cannot reasonably confirm that it will obtain the ownership of leased asset at the end of lease term, the leased asset shall be depreciated during the shorter one of the useful life of the leased asset and the lease term.
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 15. Construction in process
(1) Measurement of construction in process
Constructions in process are measured at the actual cost. For the constructions in process conducted by the Company itself, the actual cost consists of essential costs of carrying on the construction till it reaches usable status.
(2) Standards and timing for construction in process transferring into fixed assets
Cost of fixed asset which has already become usable but not settled yet, is recognized according to estimated value or the actual construction cost, and depreciations share be provided from the next month. Upon completion of settlement, the original estimated value shall be adjusted according to the actual cost.
(3) Basis of recognizing impairment and providing of impairment provision.
At the balance sheet day, the Company performs overall testing on constructions in process and evaluates the retrievable value if evidence shows impairment occurred on the constructions. If the retrievable value is lower than the book value, the book value will be deducted to the retrievable value, and the deducted amount will be recorded as asset impairment loss into current income account, and impairment provision shall be provided accordingly. Once the impairment loss was recognized, it will not be written back in coming fiscal terms.
16. Borrowing expenses
(1) Capitalization of borrowing costs
Borrowing expenses include the interest of loans incurred, amortization of discounts or premiums and ancillary costs, as well as foreign currency exchange differences from foreign currency loans.
The costs of borrowings designated for acquisition or construction of qualifying assets should be capitalized as part of the cost of the assets. Assets satisfying the conditions of capitalization are referring to the fixed assets, investment properties, and inventories that need one year or more than oneyear’s construction or production process to reach the usable or sellable status. Borrowing expenses incurred for these assets should be accounted into costs of these assets. The other borrowing expenses should be accounted into current gains and losses when incurred.
Borrowing expenses start to be capitalized when all of the followings are satisfied:
① The capital expenditures have incurred;
② The borrowing costs have incurred;
③ The acquisition and construction activities that are necessary to bring the asset to its expected usable condition have commenced.
(2)Capitalization period of borrowing costs
Capitalization of borrowing costs should be suspended during periods in which the acquisition or construction is interrupted abnormally, and the interruption period is three months or longer. These borrowing costs should be
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 recognized directly in profit or loss during the current period.
Capitalization of borrowing costs ceases when the qualifying asset being acquired or constructed is substantially ready for its intended use. Subsequent borrowing costs should be expensed off during the period in which they are incurred.
(3) Time period of suspending capitalization
Where the acquisition and construction or production of a qualified asset is interrupted abnormally and the interruption period lasts for more than 3 months, the capitalization of the borrowing costs shall be suspended. The borrowing costs incurred during such period shall be recognized as expenses, and shall be recorded into the profits and losses of the current period, till the acquisition and construction or production of the asset restarts. If the interruption is a necessary step for making the qualified asset under acquisition and construction or production ready for the intended use or sale, the capitalization of the borrowing costs shall continue.
When the qualified asset under acquisition and construction or production is ready for the intended use or sale, the capitalization of the borrowing costs shall be ceased.
(4) Calculation method of capitalization for borrowing costs
To the extent that funds are borrowed specifically for the purpose of acquiring or constructing a qualifying asset, the amount of borrowing costs eligible for capitalization on that asset is determined as the actual borrowing costs incurred on that borrowing during the period less any investment income on the temporary investment of the borrowing.
To the extent that funds are borrowed generally and used for the purpose of acquiring or constructing a qualifying asset, the amount of borrowing costs eligible for capitalization shall be determined by applying a capitalization rate to the weighted average of excess of accumulated expenditures on qualifying asset over that on specific purpose borrowing. The capitalization rate is the weighted average of the borrowing costs applicable to the borrowings of the Company that are outstanding during the period, other than borrowings made specifically for the purpose of acquiring or constructing a qualifying asset.
17. Intangible assets
(1) Recognition of intangibleassets：
The intangible assets refer to the land-use right, patent, non-patent technology and software.
Intangible assets are initially measured by their costs. Intangible assets purchased are booked at the actual cost to purchase and relative expenses.
Intangible assets inputted by investors are booked at the contract or agreement price, but if the contract or agreement price is not fairly acceptable, it will be booked at fair value.
In case the non-currency asset exchange is characteristic of commercial substance and the fair values of received or delivered assets can be reliably calculated, the book values of received intangible assets in the non-currency asset exchange will normally be determined based on the fair values of delivered assets, except that the accurate evidences indicate that the fair values of received assets are more reliable. In case any non-currency asset
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 exchange does not meet the above conditions, the book values of delivered assets and the payable taxes will be deemed as the costs of received intangible assets. No profit and loss will be confirmed.
In case the intangible assets are obtained by the liability restructure to write off the liabilities of debtors, their book values will be determined based on the fair values of this intangible asset.
Expenditures incurred during the research phase of an internal project shall be recognized as expenses in the period in which they are incurred. Expenditures incurred during the development phase of an internal project shall be recognized as an intangible asset if, and only if, the Company can demonstrate all of the following:
①The technical feasibility of completing the intangible asset so that it will be available for use or sale;
②Its intention to complete the intangible asset and use or sell it;
③The method that the intangible asset will generate probable future economic benefits. Among other things, the Company can demonstrate the existence of a market for the output of the intangible asset or the intangible asset itself or, if it is to be used internally, the usefulness of the intangible asset;
④The availability of adequate technical, financial and other resources to complete the development and to use or sell the intangible asset;
⑤ Its ability to measure reliably the expenditure attributable to the intangible asset during its development.⑥ The use of the intangible products cycle more than 1 year.
(2) Usage life and amortization of intangibleassets：
||||
|-|-|-|
|Items|Expected Useful Life|Amortization Method|
|The land-use rights|Beneficial years|Straight-line method|
|The non-patent technology|Contract years or beneficial years|Straight-line method|

(3) Impairment provisions of intangibleassets：
Intangible assets without certain useful life are not amortized. They will be reconsidered in each accounting period, if strong evidence showing that the useful life became limited, then it will be estimated, and amortized on straight basis.
On the balance sheet date, the Company measures intangible assets according to the lower of book value and retrievable value, intangible asset impairment provisions shall be provided at the difference of retrievable value lower than the book value, and the corresponding impairment loss shall be recorded to current income account. Once intangible asset impairment losses are recognized, they will not be written back in successive fiscal periods.① It has been replaced by other new technologies, and significantly decreased its ability to create economic interests for the Company;
② The price fell sharply in current period, and is not expected to increase in its remaining amortization period;
③ Over the time limit of legal protection, but still has someuse-value；
④ Other facts that prove the assets actually impaired.
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 18. Long-term deferred expenses
The Company recognizes all expenses which have occurred during the period but shall be amortized beyond one year, such as improvement expenditures of operating leased fixed assets, as long-term deferred expenses. The Company amortizes long-term deferred expenses by straight-line method according to relevant beneficial periods or its usage life, long-term deferred expenses are amortized in five years if its beneficial periods or usage lifecan’t be estimated.
19. Expected liabilities
(1) Recognition of expected liabilities
When responsibilities occurred in connection to contingent issues, and all of the following conditions are satisfied, they are recognized as expected liability in the balance sheet:
① This responsibility is a current responsibility undertaken by the Company;
② Execution of this responsibility may cause financial benefit outflow from the Company;
③ Amount of the liability can be reliably measured.
(2) Measurement of expected liabilities
Expected liabilities are initially measured at the best estimation on the expenses to exercise the current responsibility, and the Company shall give considerations to the relative risks, uncertainty, and periodic value of currency. When the periodic value of currency is with major influence, then the best estimation will be determined at the discount of future cash outflow. The book value of expected liability is revised at balance sheet day, and adjustment will be made to reflect current best estimation.
20. Share-based payments and equity instruments
(1) Categories of share-based payments
The share-based payments shall consist of equity-settled share-based payments and cash-settled share-based payments.
(2) The measures for the confirmation of the fair value of the equity instruments
The fair value of the equity instruments shall be confirmed in accordance with Accounting Standards for Enterprises No.22-Recognition and Measurement of Financial Instruments.
(3) The measures for the confirmation of the best estimate of the number of the equity instruments about the exercisable right
Within the vesting period, at each balance sheet date, the company makes a best estimate according to the after information about number of exercisable employees and revises the estimated number of the equity instruments about the exercisable right. At the vesting date, the final estimated number of the equity instruments about the exercisable right should be conformed to the actual number about the exercisable right
21. Revenues
(1) Sales of goods
When all of the following conditions are satisfied, the sales of goods are recognized as sales income according to
the contract amount received or receivable from the buyer:
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012① Main risks and rewards attached to the ownership of the goods have been transferred to the buyer;② No succeeding power of administration or effective control is reserved which are usually attached to ownership;
③ Amount received can be reliably measured;
④ Related financial benefit may inflow to the Company;
⑤ Relative costs, occurred or will occur, can be reliably measured;
⑥ When collection of contract payment is by differed way, and practically with financing characters, sales income shall be recognized at the fair value of the receivable contract amount.
(2) Providing of labor service
Labor service started and completed in a same fiscal year is recognized as income at completion. If they are not in the same year, then use the estimation on percentage basis when it is possible. When the labor cost occurred is expectable to be covered, the labor service income is recognized at the cost already occurred, and recorded to labor cost as well. When the labor cost occurred is not expectable to be covered, the cost will be recorded to current gain/loss account without recognizing as labor service income.
(3) Demising of asset using rights
Income is recognized when the financial benefit in connection with the demising of asset using right was received and the amount can be reliably measured.
22. Government grant
The income approach for government grants, to retrieve expense or loss of the Company in further period, the government grants are recognized as deferred income, and shall be recorded in profit and loss when that expense or loss occurred. To retrieve expense or loss of the Company in current period, the government grants shall be recorded directly in current profit and loss. If related assets were disposed before using period ended, undistributed deferred income shall be shift to current profit and loss at once.
The Capital approach for government grants, the grant is recognized as deferred income when it is acquired. Since the related assets achieve its intended using status, the deferred income is amortized and recognized in profit and loss duringasset’s using period.
23. Differed income tax assets/ differed income tax liabilities
Based on the differences between the book values of assets and liabilities and taxation basis (for the items that have not been confirmed as the assets and liabilities, if their taxation basis may be determined in accordance with the taxation provisions, the difference between such taxation basis and their book values will be applied), the deferred income tax assets or deferred income tax liabilities will be confirmed at the applicable tax rate during the expected periods of returning such assets or settling such liabilities.
The Company will confirm the deferred income tax assets generated by the deductible temporary difference within the limit of taxable income amount that may be obtained and used to deduct such difference. On the preparation date of balance sheet, if enough evidences prove that the taxable income amounts that maybe probably obtained in the future periods may be used to deduct the deductible temporary differences, they will be confirmed
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 as the deferred income tax assets that have not been confirmed in the previous accounting periods.
On the preparation date of balance sheet, the Company will recheck the book values of deferred income tax assets. If the taxable income amounts cannot be obtained in the future periods to be used to deduct the benefits of deferred income tax assets, the Company will reduce the book values of deferred income tax assets. If there is great possibility to obtain enough taxable income amounts, the reduced amounts may be reversed.
24. Hedging Accounting
The term " hedging" refers to one or more hedging instruments which are designated by the company for avoiding the risks of foreign exchange, interest rate, commodity price, stock price, credit and etc., and which is expected to make the changes in fair value or cash flow of hedging instrument(s) to offset all or part of the changes in the fair value or cash flow of the hedged item.
The term "hedging instrument" shall refer to a derivative instrument which is designated by the company for hedging and by which it is expected that changes in its fair value or cash flow can offset the changes in fair value or cash flow of the hedged item. For a hedging of foreign exchange risk, a non-derivative financial asset or non-derivative financial liability may be used as a hedging instrument.
The "hedged items" refer to items which make the company faced with changes in fair value or cash flow and are designated as the hedged objectives.
For a hedging which satisfies all the following conditions, the company will deal with it through the hedging accounting method.
(1) At the commencement of the hedging, the company shall specify the hedging relationship formally and prepare a formal written document on the hedging relationship, risk management objectives and the strategies of hedging.
(2) The hedging expectation is highly efficient and meets the risk management strategy, which is confirmed for the hedging relationship by the company at the very beginning.
(3) For a cash flow hedging of forecast transaction, the forecast transaction shall be likely to occur and shall make the company faced to the risk of changes in cash flow, which will ultimately affect the profits and losses. (4) The effectiveness of hedging can be reliably measured.
(5) The hedging is highly effective in the accounting period in which the hedging relationship is designated. 25. Change of main accounting policies and estimations
(1) Change of accounting policies
No change of accounting policies occurred in the year.
(2) Change of accounting estimations
No change of accounting estimations occurred in the year.
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 26. Correction of previous accounting faults
No correction of previous accounting faults occurred in the report term.
Note V. Taxation
1. Main tax type and Tax rate applied
||||
|-|-|-|
|Tax Type|Tax Basis|Tax Rate|
|Value-added Tax|Output tax of Taxable Income lessdeductible input VAT|17%|
|Business tax|Taxable Income|5%|
|Urban maintenance and construction tax|Turnover tax payables|7%|
|Educational surtax|Turnover tax payables|5%|
|Corporate income tax|Income Tax Payables|25% or 15%|
|Flood Control Security Fund|Operating Income|0.1% or 0.06%|
|Dike maintenance cost|Turnover tax payables|2%|

2. Notes
In November 2008, The Company and its subsidiary Hefei Midea Washing Machine Co., Ltd, Wuxi Little Swan GE Co., Ltd, Little Swan (Jingzhou) SanJin Electric Co., Ltd, Wuxi Filin Electronics Co., Ltd, Little Swan (Jingzhou) SanJin Electric Co., Ltd gained the certificate of‘High-techEnterprises’. The Certificate Numbers are GR200932000077, GR200834000011, GR200932000078, GR200932000397. The Certification Dates respectively are Mar 2009, Nov 2008, Mar 2009, May 2009 and Nov 2011.
Term of validity for this Certificate is three years. The company and its subsidiaries Hefei Royalstar Washing Machine Manufacture Co., Ltd., Wuxi Little Swan GE Co., Ltd and Wuxi Filin Electronics Co., Ltd. have been through the review on the expiry Date. The company obtained the reviewed certificate with the number of GF201232000096 in June 2012; Hefei Washing Machine Co., Ltd obtained its reviewed certificate with the number of GF201134000043 in October 2011; Wuxi Little Swan GE Co., Ltd. obtained its reviewed certificate with the number of GF201232000077 in May 2012, and Wuxi Filin Electronics Co., Ltd. obtained the reviewed certificate as GF201232000673 in August 2012.
According to Document guoshuifa[2008] 111 of‘State Administration of Taxation: Notification of Corporate Tax Relief andExemption’ and guoshuihan[2008] 985 of‘State Administration of Taxation: Notification of Corporate Tax Payment by High-Tech Enterprises of financial Year2008’ issued by State Administration of Taxation, for the Company and its four subsidiaries, Hefei Washing Machine Co., Ltd, Wuxi Little Swan GE Co., Ltd, Wuxi Filin Electronics Co., Ltd and Little Swan (Jing Zhou) Electronic Appliances Co., Ltd., the applicable corporate income tax rate is15%.
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 NOTEVI：Business Combination and Consolidated Financial Statements
1. Subsidiaries
(1) The subsidiaries obtained through establishment or investment Unit：RMB(0’000)
|||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
|Subsidiaries|Categories|RegistrationAddress|Businessnature|Registered capital|Businessscope|Paid-incapital|Othernetinvestments insubsidiaries|Shareholdingratio(%)|Theproportionofvotingrights(%)|prepareconsolidatedstatements|MinorityInterest|DeductibleMinorityinterest|Balance of parentcompany’sequity afterdeducting shareof loss tominority interestexceed equityobtained byminorityshareholders atopening balance|
|Wuxi Little Swan GeneralElectric Appliances Co. ,Ltd.|Holdingsubsidiaries|Wuxi|Manufacturing|2,800.00|Manufacture and saleof washingmachineand dryers|1,960.00|-|70.00|70.00|Yes|4,038.67|-|-|
||||||Developme|||||||||
||Holdin|||||||||||||
|Wuxi Little Swan Drive|||||nt &|||||||||
||g|||||||||||||
|Control Technological||Wuxi|R&D|500|research of|-|-|97.30|100.00|Yes|—|-|-|
||subsidi|||||||||||||
|Development Co. , Ltd.|||||Driving &|||||||||
||aries|||||||||||||
||||||Control|||||||||
||||||Manufactur|||||||||
||Holdin||||e And|||||||||
|Wuxi Filin Electronics|g||Manufact||Developme|||||||||
|||Wuxi||$362.46||2,563.03|-|73.00|73.00|Yes|7,542.61|-|-|
|Co. , Ltd.|subsidi||uring||nt of new|||||||||
||aries||||electronic|||||||||
||||||component|||||||||
|Wuxi Little Swan Washing|Holdin||Manufact||Manufactur|||||||||
|||Wuxi||4967.95||3,725.98|-|99.91|99.91|Yes|-|-|-3,814.61|
|Machine Co. , Ltd.|g||uring||e and sale|||||||||

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
|||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
||subsidi||||of|||||||||
||aries||||commercial|||||||||
||||||washing|||||||||
||||||machine|||||||||
||||||and dryers|||||||||
||Holdin|||||||||||||
|Wuxi Meitian Refrigerator|g||||Sales of|||||||||
|||Wuxi|Selling|$400||2,484.00|-|75.00|75.00|Yes|-|-|-|
|Marketing Co., Ltd.|subsidi||||refrigerator|||||||||
||aries|||||||||||||
||Holdin||||Sales of|||||||||
|Jiangsu Little Swan||||||||||||||
||g||||household|||||||||
|Marketing and Sales Co. ,||Wuxi|Selling|41,950.00||41,794.00|-|99.63|99.63|Yes|-|-|-8,185.13|
||subsidi||||electrical|||||||||
|Ltd.||||||||||||||
||aries||||appliances|||||||||
||||||Imports &|||||||||
||Holdin||||exports of|||||||||
||||Imports|||||||||||
|Wuxi Little Swan Import &|g||||mechanical|||||||||
|||Wuxi|&|6,500.00||5,750.00|-|88.46|88.46|Yes|-||-1,517.50|
|Export Co. , Ltd|subsidi||||and|||||||||
||||Exports|||||||||||
||aries||||electrical|||||||||
||||||products|||||||||
||Wholl|||||||||||||
||y-own|||||||||||||
|Little Swan International||Singapor||||||||||||
||ed||Investing|$500|Investing|$500|-|100|100|Yes|-|-|-|
|(Singapore) Co., Ltd.||e||||||||||||
||subsidi|||||||||||||
||ary|||||||||||||
||Wholl|||||||||||||
||||||Manufactur|||||||||
||y-own|||||||||||||
|Tianjin Little Swan|||Manufact||e of|||||||||
||ed|Tianjin||20,000||20,000|-|100|100|Yes|-|-|-|
|Washing Machine Co., Ltd.|||uring||washing|||||||||
||subsidi|||||||||||||
||||||machine|||||||||
||ary|||||||||||||

(2) The subsidiaries obtained through business combination under common control
|||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
|Subsidiaries|Categories|RegistrationAddress|Businessnature|Registeredcapital|Businessscope|Paid-incapital|Other Netinvestmentsin subsidiaries|Theproportion|Theproportion|preparecons|MinorityInterest|DeductibleMinorit|Balance of parentcompany’s equityafter deducting|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
|||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
|||||||||ofholdingshares(%)|ofvotingrights(%)|olidatedstatements||yinterest|share of loss tominority interestexceed equityobtained byminorityshareholders atopening balance|
||Wholl|||||||||||||
||||||Manufact|||||||||
|Little Swan (Jing Zhou)|y-own|||||||||||||
||||Manufact||ure of|||||||||
|Sanjin Electronic|ed|Jingzhou||1,107.02||1,186.94|-|100.00|100.00|Yes|-|-|-|
||||uring||washing|||||||||
|Appliances Co., Ltd.|subsidi|||||||||||||
||||||machines|||||||||
||ary|||||||||||||
||Holdin||||Manufact|||||||||
|Hefei Midea Washing|g||Manufact||ure of|83,096.2||||||||
|||Hefei||$13,552|||-|69.47|69.47|Yes|50,718.22|-|-|
|Machine Co., Ltd.|subsidi||uring||washing|3||||||||
||aries||||machines|||||||||
||Holdin||||Manufact|||||||||
|Hefei Midea Washing||||||||||||||
||g||Manufact||ure of|||||||||
|Machine Manufacture Co.,||Hefei||2,000.00||1800|-|90.00|90.00|Yes|212.22|-|-|
||subsidi||uring||washing|||||||||
|Ltd.||||||||||||||
||aries||||machines|||||||||

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 2. Changing of consolidation scope
Wuxi Little Swan Drive Control Technological Development Co. , Ltd have closed down during this financial year so the consolidation scope of subsidiaries is one less compared to last year. And it shall not be included in consolidation scope from the date of Dec 17, 2013.
3. The entities which are included in or excluded from consolidation scope for the reporting period
||||
|-|-|-|
|Entity Name|Net asset on disposal Date|Net profit to the date ofdisposal of the financial year|
|Wuxi Little Swan Drive Control TechnologicalDevelopment Co. , Ltd|11,424,799.57|-223,874.48|

4. Exchange Rate on major Items of financial statement of overseas operating entities
Exchange Rate on major Items of financial statement of overseas operating entities of the reporting period are: Asset and Liability item shall be translated by Spot rate quoted at balance sheet date, which refers to RMB 6.0969 to$ 1. Equity items (except for retained earnings) shall translate using spot rate of the transaction date. Statement of comprehensive income and statement of cash flow shall be translated as approximate rate of the year, which is RMB 6.1896 to$ 1.
NoteVII：Notes to the items of consolidated financial statements (Uint: RMB yuan) 1. Monetary fund
(1) Items analysis
Unit: yuan
||||||||
|-|-|-|-|-|-|-|
|Items|Closing Balance|||Opening Balance|||
||Amount inforeigncurrency|ExchangeRate|Amount in RMB|Amount inforeigncurrency|ExchangeRate|Amount in RMB|
|Cash:|||||||
|RMB|||21,277.15|||169,620.72|
|Subtotal|||21,277.15|||169,620.72|
|Cash in Bank：|||||||
|USD|10,072,251.52|6.0969|61,409,510.29|22,185,864.08|6.2855|139,449,248.67|
|EUR|190,238.29|8.4189|1,601,597.14|587,330.39|8.3176|4,885,179.25|
|JPY|15.00|0.057771|0.87|130,960,172.00|0.073049|9,566,509.61|
|RMB|||1,495,172,481.08|||1,139,055,658.75|
|Subtotal|||1,558,183,589.38|||1,292,956,596.28|
|Other Cash andCashequivalents:|||||||
|USD|499,110.61|6.0969|3,043,027.48||||
|RMB|||56,125,194.49|||111,164,877.65|
|Subtotal|||59,168,221.97|||111,164,877.65|
|Total|||1,617,373,088.50|||1,404,291,094.65|

 2. Trading financial assets
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012（1）Financial assets Held for trading
Unit：yuan
||||
|-|-|-|
|Items|Fair value at the end of theperiod|Fair value at the beginning ofperiod|
|Derivatives- Currency Forward Contract|15,016,740.00|1,224,590.00|
|Total|15,016,740.00|1,224,590.00|

 3. Notes receivable
（1） Classification
Unit: yuan
||||
|-|-|-|
|Categories|Closing Balance|Opening Balance|
|Bank’s acceptance Notes|2,449,770,225.41|2,262,814,443.87|
|Total|2,449,770,225.41|2,262,814,443.87|

 (2) Information about Notes Receivables transferred into Accounts Receivable due to Drawer unable to perform the payment, and unexpired Notes receivables endorsed to other parties.
List of top 5 Notes Receivables significant in value that have been endorsed to other parties by the
Company
Unit: yuan
|||||
|-|-|-|-|
|Drawer|Date of issue|Maturity date|Amount|
|Xi’an Gome Appliance Co., Ltd|2013-10-30|2014-04-30|10,405,909.77|
|Suning procurement center of SuningCommerce Group Co., Ltd|2013-11-01|2014-04-30|10,000,000.00|
|Suning procurement center of SuningCommerce Group Co., Ltd|2013-11-01|2014-04-30|10,000,000.00|
|Shanghai Suning Commerce Marketing Co.,Ltd|2013-11-15|2014-05-15|10,000,000.00|
|Beijing Suning Commerce Marketing Co., Ltd|2013-10-14|2014-04-14|9,814,110.69|
|Total|||50,220,020.46|

 4. Accounts receivable
(1) Accounts receivable is categorized as:
Unit: yuan
||||||||||
|-|-|-|-|-|-|-|-|-|
|Categories|Closing Balance||||Opening Balance||||
||Carrying Amount||Bad debt Provisions||Carrying Amount||Bad debt Provisions||
||金额Amount|(%)|Amount|(%)|Amount|(%)|Amount|(%)|
|Individuallysignificant accountreceivable on whichthe bad debtprovisions areprovided individually|-|-|-|-|-|-|-|-|
|Accounts receivable for which the bad debt provisions are provided on asset combinations|||||||||
|Combination 1：|819,724,441.69|97.94|41,980,309.37|5.12|761,867,357.16|99.87|39,668,452.50|5.21|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
||||||||||
|-|-|-|-|-|-|-|-|-|
|Aging|||||||||
|Combination 2:Accounts Receivablein consolidated scope|-|-|-|-|-|-|-|-|
|Subtotal|819,724,441.69|97.94|41,980,309.37|5.12|761,867,357.16|99.87|39,668,452.50|5.21|
|Accounts receivablewhich are notindividuallysignificant, but still thebad debt provisionsare providedindividually|17,241,527.92|2.06|17,241,527.92|100|1,005,623.68|0.13|1,005,623.68|100|
|Total|836,965,969.61|100|59,221,837.29|7.08|762,872,980.84|100|40,674,076.18|5.33|

 There were no individually significant accounts receivable on which the bad debt provisions are provided individually in the reporting period.
Individually significant accounts receivable on which the bad debt provisions are provided individually at the balance sheet date
□ Applicable√ Not Applicable
Accounts receivable on which the bad debt provisions are provided by combinations according to age
√ Applicable□ Not Applicable
Aging analysis for combination according to accountage：
Unit: yuan
||||||||
|-|-|-|-|-|-|-|
|Aging|Closing Balance|||Opening Balance|||
||Carrying Amount||Bad Debt Provision|Carrying Amount||Bad DebtProvision|
||Amount|(%)||Amount|(%)||
|Within 1 Year|813,679,130.91|99.26|40,683,956.54|752,659,402.92|98.79|37,632,970.15|
|1-2 Years|4,906,952.28|0.60|490,695.24|409,218.54|0.05|40,921.85|
|2-3 Years|115,910.66|0.02|23,182.13|8,376,218.80|1.10|1,675,243.76|
|3-5 Years|599,930.94|0.07|359,958.56|258,000.40|0.04|154,800.24|
|Over 5 Years|422,516.90|0.05|422,516.90|164,516.50|0.02|164,516.50|
|Total|819,724,441.69|100|41,980,309.37|761,867,357.16|100|39,668,452.50|

 Accounts receivable on which the bad debt provisions are provided by combinations according to balance percentage method
□ Applicable√ Not Applicable
Accounts receivable on which the bad debt provisions are provided by combinations with other methods□ Applicable√ Not Applicable
Accounts receivable which are not individually significant, but still the bad debt provisions are provided individually at the balance sheet date
√ Applicable□ Not Applicable
Accounts receivable which are not individually significant, but still the bad debt provisions are
provided individually
Unit：yuan
||||||
|-|-|-|-|-|
|Company Name|Carrying Amount|Bad DebtProvision|（%）|Reason|
|China Nuclear Power EngineeringCo., Ltd|2,367,588.00|2,367,588.00|100|Uncollectable|
|Chongqing Taizheng (Group) Co.,Ltd|1,851,500.00|1,851,500.00|100|Uncollectable|
|Chongqing Fuli Real-estateDevelopment Co., Ltd|1,675,800.00|1,675,800.00|100|Uncollectable|
|Chongqing Zhongcheng Property|1,655,000.00|1,655,000.00|100|Uncollectable|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
||||||
|-|-|-|-|-|
|Development Co., Ltd|||||
|Headquarters of Hangzhou West LakeXixi Wetland ComprehensiveProtection Program|1,427,004.00|1,427,004.00|100|Uncollectable|
|Hunan Huitang Hot spring HuatianProperties Co., Ltd with other 63Companies|8,264,635.92|8,264,635.92|100|Uncollectable|
|Total|17,241,527.92|17,241,527.92|--|--|

 (2) Accounts Receivable Collected or Recovered:
Unit:yuan
||||||
|-|-|-|-|-|
|Company Name|Reason|Determination of BadDebt|Accumulated BadDebt Provisionbefore recovery|Amount|
|Huagao Tech (Suzhou)Co., Ltd|Collect the Debtthrough furtheroperating Activities|Left over issues withmany handovers, it isexpected unrecoverable.|12,146.16|12,146.16|
|Wuxi Shengchaopetrochemical andmetallurgical equipmentFactory|Settled by Wuxihigh and new techdevelopment zone|It is expectedunrecoverable.|861,084.02|721,000.00|
|Total|||873,230.18|733,146.16|

 (3) Written-off Accounts Receivable in current reporting period
|||||||
|-|-|-|-|-|-|
|Company Name|Nature|Written offDate|Written offValue|Reason|Accountsreceivablearisen fromrelated-partytransactions|
|Wuxi Shengchao petrochemical andmetallurgical equipment Factory|Paymentfor goods|Oct 2013|140,084.02|ExpectedUncollectableitem|No|
|Wuxi Panasonic Home AppliancesRefrigerator(Wuxi) Co., Ltd.|Paymentfor goods|Oct 2013|76,255.55|ExpectedUncollectableitem|No|
|Yanfeng Weishitong AutomotiveElectronics Co., Ltd|Paymentfor goods|Oct 2013|21,342.86|ExpectedUncollectableitem|No|
|Shanghai Rujing Electronics Co., Ltd|Paymentfor goods|Oct 2013|15,564.15|ExpectedUncollectableitem|No|
|Fujitsu General (Shanghai) Co., Ltd|Paymentfor goods|Oct 2013|13,768.98|ExpectedUncollectableitem|No|
|Yanfeng Weishitong YidongAutomobile Dashboard Co., Ltd|Paymentfor goods|Oct 2013|5,461.96|ExpectedUncollectableitem|No|
|Total|||272,477.52|||

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 (4) Accounts receivable due from shareholders with more than5% (including5%) of the voting shares of the Company.
None.
(5) Illustration of Top 5 Accounts receivable significant in Value at the end of reporting period Unit:yuan
||||||
|-|-|-|-|-|
|Company Name|Relationship tothe Company|Amount|Aging|Percentage oftotal Amount(%)|
|Midea (Singapore) Trading Co., Ltd.|Distributors|216,980,362.32|Within 1 Year|25.92|
|Suning Produrement Centre of SuningCommerce Group Co., Ltd|Distributors|178,446,191.04|Within 1 Year|21.32|
|GEA PRODUCTS|Distributors|59,047,326.47|Within 1 Year|7.06|
|Jilin Midea Refrigeration Product MarketingCo., Ltd|Distributors|26,327,818.83|Within 2Years|3.15|
|Kunming Midea Refrigeration ProductMarketing Co., Ltd|Distributors|24,182,380.11|Within 1 Year|2.89|
|Total||504,984,078.77||60.34|

 (6) Accounts Receivable due from Related parties at the end of reporting period
Unit: yuan
|||||
|-|-|-|-|
|Company Name|Relationship to the Company|Amount|Percentage oftotal Amount(%)|
|Midea (Singapore) Trading Co., Ltd.|Held by ControllingShareholder of the Company|216,980,362.32|25.92|
|MIDEA SCOTT & ENGLISH SDN BHD|Participated by ControllingShareholder of the Company|10,020,687.97|1.20|
|PT. Midea Planet Indonesia|Participated by ControllingShareholder of the Company|2,507,863.97|0.30|
|Midea Household Equipment (Vietnam)Co., Ltd|Held by ControllingShareholder of the Company|4,651.08|—|
|Hefei Midea Refrigerator Co. , Ltd.|Held by ControllingShareholder of the Company|1,788.06|—|
|Total||229,515,353.40|27.42|

 5. Other receivables
(1) Disclosure of Other Account Receivable by Categories
Unit: yuan
||||||||||
|-|-|-|-|-|-|-|-|-|
|Categories|Closing Balance||||Opening Balance||||
||Book Balance||Bad Debt Provision||Book Balance||Bad Debt Provision||
||Amount|(%)|Amount|(%)|Amount|(%)|Amount|(%)|
|Individuallysignificant otherAccounts receivableson which the bad debtprovisions areprovided individually|—|—|—|—|—|—|—|—|
|Other Accounts receivable for which the bad debt provisions are provided on asset combinations|||||||||
|Combination 1: Aging|29,105,439.83|100|2,941,915.70|10.11|21,500,115.42|98.98|4,515,597.93|21.00|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
||||||||||
|-|-|-|-|-|-|-|-|-|
|Combination 2：OtherAccounts Receivablein ConsolidationScope|—|—|—|—|—|—|—|—|
|Subtotal|29,105,439.83|100|2,941,915.70|10.11|21,500,115.42|98.98|4,515,597.93|21.00|
|Other Accountsreceivable which arenot individuallysignificant yet baddebt provisions areprovided individually|—|—|—|—|221,066.34|1.02|221,066.34|100|
|Total|29,105,439.83|100|2,941,915.70|10.11|21,721,181.76|100|4,736,664.27|21.81|

 Categories of other receivables
There were no individually significant other receivables on which the bad debt provisions are provided individually in the reporting period.
Individually significant other receivables on which the bad debt provisions are provided individually at the balance sheet date
□ Applicable√ Not Applicable
Other receivables on which the bad debt provisions are provided by combinations according to age
√ Applicable□ Not Applicable
Aging analysis for combination according to accountage：
Unit yuan
||||||||
|-|-|-|-|-|-|-|
|Aging|Closing Balance|||Opening Balance|||
||Book Balance||Bad DebtProvision|Book Balance||BadDebtProvision|
||Amount|(%)||Amount|(%)||
|Within 1 Year|24,970,133.06|85.79|1,248,506.66|12,717,942.28|59.15|635,897.12|
|1-2 Years|1,442,035.00|4.95|144,203.50|782,868.30|3.64|78,286.83|
|2-3 Years|208,868.00|0.72|41,773.60|2,638,772.31|12.27|527,754.46|
|3-5 Years|2,442,429.65|8.39|1,465,457.82|5,217,182.53|24.27|3,130,309.52|
|Over 5 Years|41,974.12|0.15|41,974.12|143,350.00|0.67|143,350.00|
|Total|29,105,439.83|100|2,941,915.70|21,500,115.42|100|4,515,597.93|

 Other receivables on which the bad debt provisions are provided by combinations according to balance percentage method
□ Applicable√ Not Applicable
Other receivables on which the bad debt provisions are provided by combinations with other methods
□ Applicable√ Not Applicable
Other receivables which are not individually significant, but still the bad debt provisions are provided
individually at the balance sheet date
√ Applicable□ Not Applicable
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 (2) Illustration of Other Accounts Recdeivable Written-off in this reporting period
Unit:yuan
|||||||
|-|-|-|-|-|-|
|Company Name|Natue ofOtherAccountsRecdeivable|Date ofWritten off|AmountWritten off|Reason|Other Accountreceivablesarised fromrelated partytransactions|
|Guangzhou ShibangHuman ResourceCo., Ltd|Receivable|Oct 2013|399,265.05|Uncollectable|No|
|Qingdao BiqinElectromechanicalCo., Ltd|Receivable|Oct 2013|126,359.50|Uncollectable|No|
|Wuxi Maple SoftElectronics Co., Ltd|Receivable|Oct 2013|21,600.00|Uncollectable|No|
|Suzhou HuichuanElectromechanicalCo., Ltd|Receivable|Oct 2013|51,000.00|Uncollectable|No|
|Wuxi Jitong MotorDeveolpment Co.,Ltd|Receivable|Oct 2013|40,780.00|Uncollectable|No|
|Wuxi Dongchengplastic and hardwareCo., Ltd|Receivable|Oct 2013|30,100.06|Uncollectable|No|
|Emerson HouseholdApplianceApplicaionTechnology(Shenzhen) Co., Ltd|Receivable|Oct 2013|15,586.02|Uncollectable|No|
|Wuxi XishanHengfengPaper Co., Ltd|Receivable|Oct 2013|2,287.00|Uncollectable|No|
|Wuxi PengdeAuto Parts Co.,Ltd|Receivable|Oct 2013|2,136.10|Uncollectable|No|
|Wuxi RuilongPrinting Co., Ltd|Receivable|Oct 2013|2,000.00|Uncollectable|No|
|Wuxi SecondPlastic Co., Ltd|Receivable|Oct 2013|1,074.66|Uncollectable|No|
|Taizhou YongshengColor-printing andPackaging Co., Ltd|Receivable|Oct 2013|500.00|Uncollectable|No|
|Wuxi Wanji WashingFitting Co., Ltd|Receivable|Oct 2013|243.00|Uncollectable|No|
|Total|--|--|692,931.39|--|--|

(3) There were no account receivables due from shareholders with more than5% (including5%) of the voting shares of the Company.
(4) Illustration of Top 5 Other Accounts Receivable significant in Value at the end of reporting
period
Unit:yuan
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
||||||
|-|-|-|-|-|
|Entity Name|Relationshipwith thecompany|Amount|Aging|Percentage of totalAmount of OtherAccountReceivables(%)|
|Ministry of Industry andInformation|GovernmentDepartment|13,162,521.10|With 1 Year|45.22|
|Hefei high-tech industrialdevelopment zone treasurypayment Centre|GovernmentDepartment|1,000,000.00|3-4Years|3.44|
|Wuxi China Resources GasCo., Lts|Cooperators|926,391.20|With 1 Year|3.18|
|Huang Qingqing|Employee|794,900.00|With 1 Year|2.73|
|Hefei Labor and SocialSecurity Bureau|GovernmentDepartment|529,500.00|3-4Years|1.82|
|Total|--|16,413,312.30|--|56.39|

6. Prepayment
(1) Prepayments shall be presented by Aging
Unit: yuan
||||||
|-|-|-|-|-|
|Aging|Closing Balance||Opening Balance||
||Amount|（%）|Amount|（%）|
|Within 1 Year|130,792,399.39|92.86|88,507,679.47|91.07|
|1-2Years|5,434,937.53|3.86|8,131,834.74|8.37|
|2-3Years|4,614,587.14|3.28|548,920.00|0.56|
|Over 3 Years|—|—|—|—|
|Total|140,841,924.06|100|97,188,434.21|100|

(2) Illustration of Top 5 Prepayment significant in Value
||||||
|-|-|-|-|-|
|Company Name|Relationship to theCompany|Amount|Aging|Reason ofoutstanding|
|PetroChina East ChinaMarketing Company|Supplier|47,662,500.00|Within 1 Year|Prepayments formaterials|
|SINOPEC YanshanBranch|Supplier|29,772,000.00|Within 1 Year|Prepayments formaterials|
|Basell Asia-pacific Co.,Ltd.|Supplier|13,174,449.75|Within 1 Year|Prepayments formaterials|
|Anhui Electronic PowerHefei Power SupplyCompany|Supplier|4,253,525.09|Within 1 Year|Prepayments forelectronic power|
|Beijing GudaoInnovation andCleaning Technology Co.,Ltd|Supplier|4,131,481.91|Within 2 Years|Prepayments forequipments|
|Total||98,993,956.75|||

(3) Prepayments due from shareholders with more than5% (including5%) of Voting Shares of the Company of the reporting period
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 7. Inventory
(1) Category
Unit:yuan
||||||||
|-|-|-|-|-|-|-|
|Items|Closing Balance|||Opening Balance|||
||Balance|Inventoryrevaluationreserve|CarryingValue|Balance|Inventoryrevaluationreserve|CarryingValue|
|Materials|43,399,847.13|3,610,554.47|39,789,292.66|51,824,769.90|717,694.85|51,107,075.05|
|Working inProcess|10,469,267.54|—|1 0,469,267.54|10,576,555.01|—|10,576,555.01|
|Finished Goods|785,045,416.69|37,162,138.31|747,883,278.38|916,584,493.31|25,520,262.69|891,064,230.62|
|Total|838,914,531.36|40,772,692.78|798,141,838.58|978,985,818.22|26,237,957.54|952,747,860.68|

 (2) Inventory Revaluation Reserve
Unit:yuan
|||||||
|-|-|-|-|-|-|
|Categories|Opening Balance|Provision addedin the reportingperiod|Decrease in the reporting period||Closing Balance|
||||Revesed|Written Off||
|Material|717,694.85|3,040,112.06|—|147,252.44|3,610,554.47|
|Finished Goods|25,520,262.69|22,407,153.39|—|10,765,277.77|37,162,138.31|
|Total|26,237,957.54|25,447,265.45|—|10,912,530.21|40,772,692.78|

 8. Other current asset
Unit:yuan
||||
|-|-|-|
|Item|Closing Balance|Opening Balance|
|Financial Product in Bank|1,780,000,000.00|1,171,940,000.00|
|Expenses To Be Apportioned-Mould|11,288,539.62|29,231,819.72|
|Total|1,791,288,539.62|1,201,171,819.72|

 Other Current Assets- Financial Product in Bank are financial products acquired by idle funds of the
company.
Expenses To Be Apportioned refers to mould items whose useful life is within 1 Year.
9. Sellable financial assets
（1）Details of Available-for-sale financial assets
Unit:yuan
||||
|-|-|-|
|Items|Fair Value at end of thereporting Period|Fair Value at the beginning ofthe reporting Period|
|Equity Instrument Available For sale：|||
|Wuhan Huaxin High-technology Co., Ltd（400038）|312,816.00|286,944.00|
|Total|312,816.00|286,944.00|

 10. Co-operative& Joint-operative subsidiaries investments
Unit:yuan
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
|||||||||
|-|-|-|-|-|-|-|-|
|InvestedEntity|Share ofInterest(%)|Share ofVoting Rightin theinvestedEntity(%)|Total Asset Atthe end of theperiod|Total LiabilityAt the end ofthe period|Total NetAsset At theend of theperiod|TotalOperatingIncome ofthe reportingPeriod|Net Profit fortheReportingPeriod|
|ⅠInvestment in Joint Ventures||||||||
|GuangzhouAntaidaLogisticsCorporation|20|20|21,900,052.65|6,054,308.26|15,845,744.39|8,782,971.75|-583,509.61|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 11. Long-term equity investment
(1) List of long-term equity investment
||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|
|Entity Invested|ValuationMethod|Investment Cost|OpeningBalance|Increase/Decrease|ClosingBalance|Share ofInterest(%)|Share ofVotingRights(%)|Notes to theDifferencebetweenshare ofvoting rightsandshare ofinterest||ImpairmentProvision|ProvisionAccruedin thereporting period|Cashdividends ofthereportingperiod|
|Guangzhou AntaidaLogistics Corporation|EquityMethod|2,000,000.00|3,285,850.80|-116,701.92|3,169,148.88|20|20||—||—|—|
|P.T. Little Swan PrimaIndustries (Malaysia) Co.,Ltd|CostMethod|4,224,744.00|—|—|—|—|—||—||—|—|
|Hengtai InsuranceBrokers Co., Ltd.|CostMethod|1,000,000.00|1,000,000.00|-1,000,000.00|—|3.3 3|3.33||—||—||
|Suzhou People'sShoppingCentre(100,000 shares)|CostMethod|150,000.00|150,000.00|—|1 50,000.00|—|—||—||—|50 ,000.00|
|Bank ofJiangsu(2,202,564 Shares)|CostMethod|1,100,000.00|1,210,000.00|—|1 ,2 10,000.00|—|—||—||—|1 2 3 ,405.12|
|Inner-Mongolia BaotouDepartment StoreCo., Ltd.|CostMethod|50,000.00|50,000.00|—|50,000.00|—|—||—||—|—|
|Total|--|8,524,744.00|5,695,850.80|-1,116,701.92|4,579,148.88||||—||—|1 7 3, 405.12|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 12. Investment Property
（1）Investment property measured at cost
Unit: yuan
||||||
|-|-|-|-|-|
|Item|Opening Balance|Increase|Decrease|Closing Balance|
|Ⅰ、Total OriginalValue|6,948,011.11|23,988,709.04|—|30,936,720.15|
|1.Buildings|6,948,011.11|18,638,915.69|—|25,586,926.80|
|2.Land Use Right|—|5,349,793.35|—|5,349,793.35|
|Ⅱ、Total AccumulatedDepreciation andAmortisation|1,898,510.38|6,995,367.38|—|8,893,877.76|
|1.Buildings|1,898,510.38|5,105,107.88|—|7,003,618.26|
|2. Land Use Right|—|1,890,259.50|—|1,890,259.50|
|Ⅲ、Total Net Value|5,049,500.73|16,993,341.66|—|22,042,842.39|
|1.Buildings|5,049,500.73|13,533,807.81|—|18,583,308.54|
|2. Land Use Right|—|3,459,533.85|—|3,459,533.85|
|Ⅳ、Total ImpairmentProvision|—|12,576,065.29|—|12,576,065.29|
|1.Buildings|—|12,576,065.29|—|12,576,065.29|
|2. Land Use Right|—|-|—|-|
|Ⅴ、Total CarryingValue|5,049,500.73||—|9,466,777.10|
|1.Buildings|5,049,500.73||—|6,007,243.25|
|2. Land Use Right|—||—|3,459,533.85|

 Unit: yuan
|||
|-|-|
||Amonut|
|Depreciation and amortization accrued in current year|193,535.98|

 13. Fixed assets
(1) Illustration of Fixed asset
Unit： yuan
|||||||
|-|-|-|-|-|-|
|Item|Opening Balance|Increase||Decrease|Closing Balance|
|1、Total Original Value:|1,771,191,499.59|38,470,100.78||68,325,672.02|1,741,335,928.35|
|Including:Buildings|832,445,990.38|1,963,434.81||19,308,867.50|815,100,557.69|
|Machinery Equipements|822,132,516.71|27,986,949.14||45,978,003.15|804,141,462.70|
|Vehicles|26,378,509.82|1,228,630.35||1,047,190.40|26,559,949.77|
|Electronic Equipments& others|90,234,482.68|7,291,086.48||1,991,610.97|95,533,958.19|
||Opening Balance|Increase|Provision of theperiod|Decrease|Closing Balance|
|2、Total AccumulatedDepreciation:|457,587,977.26|—|117,979,662.77|37,760,709.77|537,806,930.26|
|Including:Buildings|114,521,682.82|—|31,148,874.85|5,136,887.33|140,533,670.34|
|Machinery Equipements|276,580,778.39|—|69,765,563.72|30,579,998.36|315,766,343.75|
|Vehicles|12,099,850.20|—|2,788,794.81|479,914.59|14,408,730.42|
|Electronic Equipments|54,385,665.85|—|14,276,429.39|1,563,909.49|67,098,185.75|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
|||||
|-|-|-|-|
|& others||||
||Opening Balance|--|Closing Balance|
|3、Total Net Value|1,313,603,522.33|--|1,203,528,998.09|
|Including:Buildings|717,924,307.56|--|674,566,887.35|
|Machinery Equipements|545,551,738.32|--|488,375,118.95|
|Vehicles|14,278,659.62|--|12,151,219.35|
|Electronic Equipments& others|35,848,816.83||28,435,772.44|
|4、Total ImpairmentProvision|16,304,996.02|--|9,284,711.23|
|Including:Buildings|15,098,707.55|--|4,550,556.97|
|Machinery Equipements|776,585.55|--|4,074,257.81|
|Vehicles|24,351.50|--|271,413.75|
|Electronic Equipments& others|405,351.42||388,482.70|
|5、Total Carrying Value|1,297,298,526.31|--|1,194,244,286.86|
|Including:Buildings|702,825,600.01|--|670,016,330.38|
|Machinery Equipements|544,775,152.77|--|484,300,861.14|
|Vehicles|14,254,308.12|--|11,879,805.60|
|Electronic Equipments& others|35,443,465.41|--|28,047,289.74|

Depreciation of the reporting period totals 117,979,662.77RMB；Fixed asset transferred from Construction In Progress is 0 during the reporting period.
14. Construction in progress
(1) Illustration of Construction in progress
Unit： yuan
||||||||
|-|-|-|-|-|-|-|
|Item|Closing Balance|||Opening Balance|||
||BookBalance|ImpairmentProvision|CarryingValue|BookBalance|ImpairmentProvision|CarryingValue|
|Tianjin Drum FactoryFoundation Project|—|—|—|5 , 53 3,291.00|5,533,291.00|—|
|Total|—|—|—|5 , 53 3,291.00|5,533,291.00|—|

 (2) Changes of main construction in process:
Unit： yuan
||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|
|Project|Budget|OpeningBalance|Increaseduringthereporintgperiod|Transferredintofixedasset|OtherDecreaseduringthereporintgperiod|Proportion ofcostincurred tototalbudget(%)|StageofCompletion|TotalAmount ofinterestCapitalised|OfWhich:Amount ofinterestCapitalised ofthisperiod|Cpitalisationrate ofthisperiod(%)|CapitalResource|ClosingBalance|
|TianjinDrumFactoryFoundation Project|7,617,600.00|5,533,291.00|—|—|5, 533, 291.00|72.64|100%|—|—|—|Self-Fin a nc ing|—|
|Total|7,617,600.00|5,533,291.00|—|—|5, 533, 291.00|||—|—|—||—|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 (3) Impairment provision for construction in progress
Unit: yuan
|||||||
|-|-|-|-|-|-|
|Project|OpeningBalance|Increase of theperiod|Decrease of theperiod|Closing Balance|Reason for Provision|
|Tianjin DrumFactoryFoundationProject|5,533,291.00|—|5 ,533,291.00|—|Land and Buildingsarereturned backto localgovernmentat the originaltransferred price|
|Total|5,533,291.00|—|5 ,533,291.00|—||

（4）Details of construction progress
||||
|-|-|-|
|Project|Stage of Completion|Note|
|Tianjin Drum Factory FoundationProject|Transferred to Local Government|TianjinIndustrial Park Project hasbeen terminated.|

 15. Intangible assets
(1) Details of intangible assets
Unit: yuan
||||||
|-|-|-|-|-|
|Item|Opening Balance|Increase of theperiod|Decrease of theperiod|Closing Balance|
|1、Total Original Value|347,207,335.42|628,840.00|89,034,900.35|258,801,275.07|
|Land Use Right|343,533,013.86|—|88,903,193.35|254,629,820.51|
|Non-patentedTechnology|1,992,000.00|—|—|1,992,000.00|
|Sofware and others|1,682,321.56|628,840.00|131,707.00|2,179,454.56|
|2、Total AccumulatedAmortisation|38,026,790.18|5,680,896.86|4,351,944.84|39,355,742.20|
|Land Use Right|34,650,420.55|5,478,463.65|4,220,237.84|35,908,646.36|
|Non-patentedTechnology|1,992,000.00|—|—|1,992,000.00|
|Sofware and others|1,384,369.63|202,433.21|131,707.00|1,455,095.84|
|3、Net Book Value|309,180,545.24|-5,052,056.86|84,682,955.51|219,445,532.87|
|Land Use Right|308,882,593.31|-5,478,463.65|84,682,955.51|218,721,174.15|
|Non-patentedTechnology|—|—|—|—|
|Sofware and others|297,951.93|426,406.79|—|724,358.72|
|4、Total ImpairmentProvision|466,425.80|—|466,425.80|—|
|Land Use Right|466,425.80|—|466,425.80|—|
|Non-patentedTechnology|—|—|—|—|
|Sofware and others|—|—|—|—|
|5、Total Carrying Value|308,714,119.44|-5,052,056.86|84,216,529.71|219,445,532.87|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
||||||
|-|-|-|-|-|
|Land Use Right|308,416,167.51|-5,478,463.65|84,216,529.71|218,721,174.15|
|Non-patentedTechnology|—|—|—|—|
|Sofware and others|297,951.93|426,406.79|—|724,358.72|

 Amortization of the current period is RMB 5,680,896.86
16. Long-term deferred expenses
Unit: yuan
||||||||
|-|-|-|-|-|-|-|
|Item|Opening Balance|Increase ofcurrent period|Amortisation ofcurrent period|OtherDecrease|ClosingBalance|Reason forotherDecrease|
|Mould|23,533,334.26|704,755.22|19,441,118.88|—|4,796,970.60|—|
|IT consultingfee|3,312,633.73|1,362,000.00|2,626,110.87|—|2,048,522.86|—|
|LeaseholdImprovementcost|755,855.64|—|453,513.36|—|302,342.28|—|
|Others|128,094.24|—|128,094.24|—|—|—|
|Total|27,729,917.87|2,066,755.22|22,648,837.35|—|7,147,835.74|—|

 17. Deferred income tax assets/deferred income tax liabilities
（1）Deferred income tax assets and deferred income tax liabilities are listed before offset
Confirmed deferred tax assets and deferred tax liabilities
Unit: yuan
||||
|-|-|-|
|Item|Closing Balance|Opening Balance|
|Deferred Tax Assets ：|||
|Impairment Provision|16,382,981.18|10,841,379.05|
|Remuneration and Dismissal Cost|5,760,927.08|6,335,180.75|
|Accrued expensess|135,295,945.42|69,848,344.20|
|Unrealized Internal Profit|10,451,805.07|9,669,597.27|
|Estimated Liabilities|1,696,578.54|2,106,204.21|
|Deferred Income (Government Grant)|85,290.00|190,770.00|
|Investment Differences|1,317,443.38|1,317,443.38|
|Subtotal|170,990,970.67|100,308,918.86|
|Deferred Tax Liabilities ：|||
|Estimated Value of Financial Asset held fortrading|2,252,511.00|183,688.50|
|Changes in Fair Value of Financial Assetavailable for Sale measured at Fair valuethrough Capital Reserve|31,877.40|27,996.60|
|Total|2,284,388.40|211,685.10|

 Unconfirmed deferred tax assets
Unit: yuan
||||
|-|-|-|
|Item|Closing Balance|Opening Balance|
|Deductible temporary differences|15,798,136.82|21,677,550.56|
|Deductible tax losses|75,366,221.20|56,550,772.09|
|Total|91,164,358.02|78,228,322.65|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 Details of taxable differences and deductible differences
Unit: yuan
||||
|-|-|-|
|Item|Temporary differences||
||Closing Balance|Opening Balance|
|Taxable Differences|||
|Estimated Value of Financial Asset held fortrading|15,016,740.00|1,224,590.00|
|Changes in Fair Value of Financial Assetavailable for Sale measured at Fair valuethrough Capital Reserve|212,516.00|186,644.00|
|Subtotal|15,229,256.00|1,411,234.00|
|Deductible differences|||
|Impairment Provision|109,219,874.55|72,244,281.49|
|Remuneration and Dismissal Cost|38,406,180.54|42,234,538.30|
|Accrued expensess|901,972,969.48|465,655,628.05|
|Unrealized Internal Profit|69,678,700.46|64,463,981.81|
|Estimated Liabilities|11,310,523.59|14,041,361.41|
|Deferred Income (Government Grant)|568,600.00|1,271,800.00|
|Investment Differences|8,782,955.88|8,782,955.88|
|Subtotal|1,139,939,804.50|668,694,546.94|

 18. Asset Impairment Provision
Unit: yuan
|||||||
|-|-|-|-|-|-|
|Item|OpeningBalance|Increase|Decrease||ClosingBalance|
||||Reversed|Written-off||
|1、Bad-Debt Provision|45,410,740.45|18,451,567.61|733,146.16|965,408.91|62,163,752.99|
|2、Inventory RevaluationReserve|26,237,957.54|25,447,265.45|—|10,912,530.21|40,772,692.78|
|3、 ImpairmentProvision of Long-termequity Investement|4,224,744.00|—|—|4,224,744.00|—|
|4、ImpairmentProvision of investmentproperty|—|12,576,065.29|—|—|12,576,065.29|
|5、 ImpairmentProvision of Fixed asset|16,304,996.02|-6,407,832.86||612,451.93|9,284,711.23|
|6、 ImpairmentProvision of Construction inProgress|5,533,291.00|—|—|5,533,291.00|—|
|7、 ImpairmentProvision of intangibleAssets|466,425.80|—|—|466,425.80|—|
|Total|98,178,154.81|50,067,065.49|733,146.16|22,714,851.85|124,797,222.29|

19. Notes payable
Unit: yuan
||||
|-|-|-|
|Categories|Closing Balance|Opening Balance|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
||||
|-|-|-|
|Bank Acceptance Bill|385,673,110.34|1,003,090,693.95|
|Total|385,673,110.34|1,003,090,693.95|

 The amount due in the next accounting period of RMB385,673,110.34 .
20. Accounts payable
(1) Details of accounts payable
Unit: yuan
||||
|-|-|-|
|Item|Closing Balance|Opening Balance|
|Within 1 year|2,670,837,986.87|2,044,635,160.07|
|1-2 years|45,299,711.81|47,405,124.51|
|2-3 years|22,284,494.89|9,750,315.03|
|3-5 years|17,047,547.93|15,836,998.95|
|Over 5 years|12,576,353.96|12,351,984.74|
|Total|2,768,046,095.46|2,129,979,583.30|

 (2) Accounts payable due to shareholders with over5% (including5%) of voting rights of the
Company of the reporting period
None.
(3) Note for the accounts payable with the age of over one year
Accounts payable aging over 1 year significant in value are mainly unsettled payment for equipments and goods.
21. Advance from customers
(1) Illustration of Advance from customers
Unit: yuan
||||
|-|-|-|
|Item|Closing Balance|Opening Balance|
|Within 1 year|980,920,518.26|770,534,048.23|
|1-2 years|44,922,372.19|7,213,629.28|
|2-3 years|5,916,412.68|1,928,106.72|
|3-5 years|8,434,917.26|12,450,147.61|
|Over 5 years|17,758,377.13|12,315,711.00|
|Total|1,057,952,597.52|804,441,642.84|

 (2) Advance from customers due to shareholders with over5% (including5%) of voting rights of the Company of the reporting period
None.
(3) Note for the advance from customers with the age of over one year
Advance from customers aging over 1 year significant in value are mainly unsettled Advance from
customers.
22.Employees’ wage payable
Unit：yuan
||||||
|-|-|-|-|-|
|Item|Opening Balance|Increase|Decrease|Closing Balance|
|1、Wage, bonus,|58,136,514.42|526,462,780.85|447,167,985.91|137,431,309.36|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
||||||
|-|-|-|-|-|
|allowance andsubsidies|||||
|2、EmployeeBenefits|4,222,517.84|51,534,700.91|47,713,448.91|8,043,769.84|
|3、 Socialinsurance|7,797,272.02|93,565,145.66|93,691,546.96|7,670,870.72|
|4、 Housing fund|6,161,915.24|20,586,225.23|20,296,422.23|6,451,718.24|
|5、Labor Unionoperationexpenses andemployee|3,809,893.78|9,861,350.47|9,311,889.32|4,359,354.93|
|6、 Terminationbenefits|45,774,549.79|5,944,610.29|8,352,563.25|43,366,596.83|
|Total|125,902,663.09|707,954,813.41|626,533,856.58|207,323,619.92|

 At the balance sheet date, the total amount of trade union and education are RMB4,359,354.93, amount of compensations for cancellation of the labor relationship with employees is RMB43,366,596.83. There is no non-monetary welfare benefits payable at the balance sheet date.
The accrued wages payable at the end of current period has been completely paid in Jan and Feb 2014. 23. Tax payable
Unit: yuan
||||
|-|-|-|
|Items|Closing balance|Opening balance|
|VAT|26,109,122.01|-59,759,954.01|
|Business tax|360,000.00|1,930,713.13|
|Corporate Income tax|137,640,615.34|38,520,975.00|
|Individual income tax|649,936.36|1,541,484.10|
|House property tax|3,807,332.62|1,376,460.23|
|Land using tax|3,105,747.40|350,261.21|
|Stamp tax|599,259.73|498,728.40|
|Urban maintenance and construction tax|6,945,372.39|131,494.23|
|Education surtax|4,986,066.76|106,658.87|
|Household electrical appliances recycling fund|11,974,697.00|9,612,869.00|
|Other taxes|3,025,706.95|1,869,261.43|
|Total|199,203,856.56|-3,821,048.41|

 24. Dividends payable
Unit: yuan
|||||
|-|-|-|-|
|Entity Name|Closing balance|Opening balance|Reason of aging over 1 year|
|Shareholders of OtherCorporate Shares With TradingLimited Conditions|3,740,152.33|3,710,206.21|Unable to pay|
|Total|3,740,152.33|3,710,206.21||

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 25. Other payables
(1) Aging analysis of other payables
Unit:yuan
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Within 1 year|34,703,583.02|39,791,570.09|
|1 -2 years|4,046,107.47|17,330,598.41|
|2-3 years|2,886,513.66|5,188,603.80|
|3-5 years|7,209,641.43|7,999,362.70|
|Over 5 years|1,175,248.08|1,416,217.37|
|Total|50,021,093.66|71,726,352.37|

 (2) List of other payables due to shareholders with more than5% (including5%) of the voting shares of the Company.
Unit: yuan
||||
|-|-|-|
|Name|Closing balance|Opening balance|
|Midea Group Co., Ltd.|390,636.00|390,636.00|
|Total|390,636.00|390,636.00|

 (3) Other Accounts Payable aging over 1 year significant in value
Other Accounts Payable aging over 1 year significant in value are mainly unsetteled suspense receipts and other accounts payable.
(4) Illustration of Other Accounts Payables Significant in value at the end of reporting period
Unit：yuan
|||||||
|-|-|-|-|-|-|
|Entity Name|Relationship tothe Company|Nature of otherAccountspayables|Amount|Aging|Proportion tototal amount ofother Accountspayables|
|Hefei Datong Gelan PlasticIndustry Co. , Ltd.|Supplier|GuaranteeDeposit|2,190,000.00|Within 1 year|4.38|
|Zhang Lei|Lessee|Payables onland andbuildingpurchased|1,100,000.00|Within 1 year|2.20|
|Gao Shouqun|Lessee|Payables onland andbuildingpurchased|1,100,000.00|Within 1 year|2.20|
|Anhui Hualong Plastic Co., Ltd.|Supplier|GuaranteeDeposit|795,000.00|Within 1 year|1.59|
|Anhui Qi Jing Machinery Co.,Ltd.|Supplier|GuaranteeDeposit|755,000.00|Within 1 year|1.50|
|Total|--|--|5,940,000.00|--|11.87|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 By Conciliation of Jinan HuaiyinPeople’s Court, Lessee Gao Shouqun, Zhang Leiha and the company have reached agreement to buy the house owned by the company which locating at Jingsanweiba Street, Huaiyin District, Jinan for the consideration of 4.4 million Yuan for total area of 893.51m2.50% of contract price have been paid with 2.2 million unpaid due from the lessee. The Payment was not settled on expiration date of this agreement. The property has not been transferred.
26. Estimated liabilities
Unit: yuan
||||||
|-|-|-|-|-|
|Item|Opening balance|Increase|Decrease|Closing balance|
|Product QualityAssurance|14,041,361.41|622,830.56|3,353,668.38|11,310,523.59|
|Total|14,041,361.41|622,830.56|3,353,668.38|11,310,523.59|

 The washing machines produced by subsidiary of the company, Wuxi Little Swan General Electric Co., Ltd., are mainly sold to the United States and other foreign markets. Overseas sale of these washing machines involves the two kinds of compensation risks: 1) Risk arised where the compensation from insurance company not available for cover the loss when the quality problems take place, and 2) Risk of liability for damages when the failure rate is
higher than FCR stipulated in the contract with General Electric Company. As of December 31, 2013, the company has estimated loss of RMB 11.3105 million for the products sold.
27. Other non-current liabilities
Unit: yuan
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Compensation Payments for Relocation|2,073,957.30|2,607,427.30|
|Total|2,073,957.30|2,607,427.30|

 Due to Urban Planing requirement, Wuxi New DistrictXin’an Street Relocation Office and Wuxi Filin Electronics Co., Ltd have reached agreement of land transfer and compensation is settled for buildings on land, which the Closing balance rised.
28. Other non-current liabilities
Unit：yuan
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Deferred Income|568,600.00|1,271,800.00|
|Total|568,600.00|1,271,800.00|

 Other non-current liabilities related to Government Grant
Unit：yuan
||||||||
|-|-|-|-|-|-|-|
|Item|Openingbalance|Government GrantIncrease|AmountTransferred intonon-operatingrevenue|OtherChanges|Closing balance|pertinent to assets/ pertinent toincome|
|Government Grant forinnovation abilityproject from NationalEnterprise TechonologyCentre|600,000.00|—|600,000.00|—|—|pertinent to assets|
|Government Grant forDevelopment of|327,800.00|—|50,400.00|—|277,400.00|pertinent to assets|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
||||||||
|-|-|-|-|-|-|-|
|substation|||||||
|Provincial financialfund for guidance ofmodern service industrydevelopment|344,000.00|—|52,800.00|—|291,200.00|pertinent to assets|
|Total|1,271,800.00|—|703,200.00|—|568,600.00|--|

 29. Share capital
Unit: yuan
|||||||||
|-|-|-|-|-|-|-|-|
||Opening balance|Increase/Decrease (+/-)|||||Closing balance|
|||Issuingnewshares|Bonusshares|Sharestransferredfrom capitalsurplus|Others|Subtotal||
|Total shares|632,487,764.00||||||632,487,764.00|

 30. Capital surplus
Unit: yuan
||||||
|-|-|-|-|-|
|Item|Openingbalance|Increase|Decrease|Closingbalance|
|Share premium|1,055,182,718.57|—|—|1 ,0 55,182,718.57|
|Capital surplus of theoriginal system transferredin|39,179,385.00|—|—|39,179,385.00|
|Loss/profit from change offair value|158,647.40|21,991.20|—|180,638.60|
|Provision of equityinvestment|1,638,562.74|—|—|1,638,562.74|
|Share payment|33,250,000.00|—|—|33,250,000.00|
|Total|1,129,409,313.71|21,991.20|—|1 ,1 29,431,304.91|

 Increase in Capital Surplus totals 21,991.20 RMB, which is fair value change of financial asset available for sale.
31. Surplus reserves
Unit: yuan
||||||
|-|-|-|-|-|
|Item|Opening balance|Increase|Decrease|Closing balance|
|Legal reserve|270,617,248.93|20,341,119.56|—|2 90,958,368.49|
|Total|270,617,248.93|20,341,119.56|—|2 90,958,368.49|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 32. Retained earnings
||||
|-|-|-|
|Item|Amounts|Extraction orallocation proportion|
|Before adjustment Retained earnings at the end oflast year|1,656,317,300.32|--|
|Adjusted retained earnings at the beginning of theyear|1,656,317,300.32|--|
|Plus: Net profit attributable to parent companytransferred in|413,350,079.54|--|
|Less: Appropriation of statutory surplus reserve|20,341,119.56|10%|
|Common share dividend payable|189,746,329.20|--|
|Retained earnings at the end of the year|1,859,579,931.10|--|

33. Operational turnover and costs
（1）Operational turnover and costs
Unit: yuan
||||
|-|-|-|
|Items|Occurred this year|Occurred last year|
|Main business income|7,994,530,052.92|6,163,266,557.05|
|Other operating income|733,425,991.45|736,597,369.76|
|Operation cost|6,549,621,939.90|5,339,914,557.98|

（2）Mainoperation（Categorize byindustries）
Unit: yuan
||||||
|-|-|-|-|-|
|Name of industry|Occurred this year||Occurred last year||
||Operating revenue|Operating cost|Operating revenue|Operating cost|
|Household appliancesmanufacture|7,994,530,052.92|5,888,976,204.86|6,163,266,557.05|4,717,192,015.96|
|Total|7,994,530,052.92|5,888,976,204.86|6,163,266,557.05|4,717,192,015.96|

（3）Mainoperation（Categorize byproducts）
Unit: yuan
||||||
|-|-|-|-|-|
|Name of products|Occurred this year||Occurred last year||
||Operating revenue|Operating cost|Operating revenue|Operating cost|
|Washing machines|7,994,530,052.92|5,888,976,204.86|6,163,266,557.05|4,717,192,015.96|
|Total|7,994,530,052.92|5,888,976,204.86|6,163,266,557.05|4,717,192,015.96|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012（4）Mainoperation（Categorize byregions）
Unit: yuan
||||||
|-|-|-|-|-|
|Name of regions|Occurred this year||Occurred last year||
||Operating revenue|Operating cost|Operating revenue|Operating cost|
|Homeland|6,322,627,813.03|4,343,498,573.35|4,131,737,749.77|2,785,735,439.42|
|Other countries|1,671,902,239.89|1,545,477,631.51|2,031,528,807.28|1,931,456,576.54|
|Total|7,994,530,052.92|5,888,976,204.86|6,163,266,557.05|4,717,192,015.96|

（5）Turnover from top 5 clients:
Unit: yuan
||||
|-|-|-|
|Name of customers|Main business income|Proportion to the wholeoperational turnover of thecompany (%)|
|Midea (Singapore) Trading Co., Ltd.|1,112,577,742.13|12.75|
|Suning Commerce Group Co., Ltd|795,381,723.31|9.11|
|Guizhou Midea Refrigeration ProductionSales Co., Ltd.|162,915,012.10|1.87|
|Beijing Jingdong Century CommerceCo., Ltd|118,037,791.26|1.35|
|Kunming Midea RefrigerationProduction Sales Co., Ltd.|117,282,652.76|1.34|
|Total|2,306,194,921.56|26.42|

34. Business tax and surcharge
Unit: yuan
|||||
|-|-|-|-|
|Items|Occurred this year|Occurred last year|Tax base|
|Business tax|16,844.56|452,161.83|Taxable revenue|
|City maintenance andconstruction tax|30,898,629.72|17,517,312.77|Turnover tax|
|Education surtax|22,087,155.71|12,512,365.57|Turnover tax|
|Total|53,002,629.99|30,481,840.17||

35. Selling expenses
Unit: yuan
||||
|-|-|-|
|Items|Occurred this year|Occurred last year|
|Employee payment|183,545,912.93|69,087,909.41|
|Shipping and handling expenses|311,473,920.77|263,884,652.66|
|Travelling expenses|31,187,832.09|20,242,094.64|
|Leasing expenses|54,754,176.97|98,471,959.31|
|Installation cost|97,296,711.96|27,793,165.10|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
||||
|-|-|-|
|Spare and accessory parts|12,713,598.44|21,319,907.16|
|Maintenance costs|93,663,632.80|48,393,831.50|
|Advertising & promotion fees|433,534,282.80|233,637,297.55|
|Others|48,948,348.44|57,729,665.20|
|Total|1,267,118,417.20|840,560,482.53|

 36.G&A expenses
Unit: yuan
||||
|-|-|-|
|Items|Occurred this year|Occurred last year|
|Employee payment|146,159,003.37|131,782,669.30|
|Depreciation|23,490,044.11|20,799,637.77|
|Water & electricity fees|8,167,655.43|10,401,122.69|
|Quality loss|20,484,435.07|13,804,451.22|
|Property tax|10,654,675.80|7,827,164.54|
|Product certification fee|4,989,452.10|9,277,378.04|
|Share payment|—|33,250,000.00|
|Others|179,535,934.92|104,244,437.40|
|Total|393,481,200.80|331,386,860.96|

 37. Financial expenses
Unit: yuan
||||
|-|-|-|
|Items|Occurred this year|Occurred last year|
|Interest expenses|5,169,679.70|8,783,561.97|
|Interest income|17,642,421.68|-24,171,770.04|
|Exchange losses|34,546,399.18|9,292,368.64|
|Commission charge|2,536,036.96|3,043,476.19|
|Total|24,609,694.16|-3,052,363.24|

 38. Gains from changes in fair values
Unit: yuan
||||
|-|-|-|
|Item|Occurred this year|Occurred last year|
|Trading financial assets|13,792,150.00|-3,067,710.00|
|Total|13,792,150.00|-3,067,710.00|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 39. Investment income
(1) Details of investment income
Unit: yuan
||||
|-|-|-|
|Items|Occurred this year|Occurred last year|
|Long-term equity investment gains oncost basis –cash dividends fromnon-subsidiaries|173,405.12|341,810.24|
|Long-term equity investment gains on equitybasis|-116,701.92|-143,000.95|
|Gains from disposal of long-term equityinvestment|308,469.59|—|
|Investment gains from holding of tradingfinancial assets, etc.|18,931,670.00|6,782,220.00|
|Other|97,565,087.41|48,641,661.11|
|Total|116,861,930.20|55,622,690.40|

 (2) Long-term equity investment gains on cost basis
Unit: yuan
||||
|-|-|-|
|Name of Investee|Occurred this year|Occurred last year|
|Hengtai Insurance Brokers Co., Ltd.||55,000.00|
|Suzhou People's Shopping Centre|50,000.00|40,000.00|
|Bank of Jiangsu|123,405.12|246,810.24|
|Total|173,405.12|341,810.24|

 (3) Long-term equity investment gains on equity basis
Unit: yuan
||||
|-|-|-|
|Name of Investee|Occurred this year|Occurred last year|
|Guangzhou Antaida MaterialDistribution Co. , Ltd.|-116,701.92|-143,000.95|
|Total|-116,701.92|-143,000.95|

 40. Impairment provisions of assets
Unit: yuan
||||
|-|-|-|
|Items|Occurred this year|Occurred last year|
|1.Bad debt losses|17,718,421.45|-8,216,753.61|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
||||
|-|-|-|
|2.Inventory impairment|25,447,265.45|10,888,394.98|
|3.Fixed assets impairment|6,168,232.43|—|
|4.Construction in progressimpairment|—|5,533,291.00|
|5.Intangible assets impairment|—|466,425.80|
|Total|49,333,919.33|8,671,358.17|

 41. Non-operating income
(1) Details of non-operating income
Unit: yuan
|||||
|-|-|-|-|
|Items|Occurred this year|Occurred last year|Amount accountedinto non-recurringgain and loss incurrent year|
|Gains from disposal of noncurrentassets|2,883,982.52|10,850,074.46|2,883,982.52|
|Inclusive of: Gains from disposal offixed assets|2,883,982.52|10,850,074.46|2,883,982.52|
|Gains from debt restructuring|2,807,241.09|9,544,766.77|2,807,241.09|
|Gains from governmental subsidy|10,798,333.04|8,112,282.45|10,798,333.04|
|Penalty income|23,748,858.49|23,335,697.60|23,748,858.49|
|Other|136,438.25|161,167.28|136,438.25|
|Total|40,374,853.39|52,003,988.56|40,374,853.39|

(2) Details of gains from government subsidies:
Unit: yuan
||||||
|-|-|-|-|-|
|Item|Amount in currentperiod|Amount in last period|pertinent toassets / pertinentto income|Non-recurring gainand loss|
|VAT Rebate on collection|6,238,538.06|2,814,198.28|pertinent toincome|Yes|
|Hefei Post Allowance forenterprises in difficulties|3,838,680.00|—|pertinent toincome|Yes|
|Subsidies for export creditinsurance premiums|2,473,500.00|353,200.00|pertinent toincome|Yes|
|Hefei Key Project Fund|2,645,382.00|—|pertinent toincome|Yes|
|Wuxi Capital Support Forscience and technology R&D(Designing) Institute|2,000,000.00|—|pertinent toincome|Yes|
|Special Capital Support forEnvironmental Protection|1,060,000.00|—|pertinent toincome|Yes|
|Fund for TechnicalProfessional Training|742,000.00|—|pertinent toincome|Yes|
|Capital Support For foreigntrade and economicdevelopment|693,000.00|1,080,000.00|pertinent toincome|Yes|
|National Technology Centerinnovation capacity Funds|600,000.00|600,000.00|pertinent toassets|Yes|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
||||||
|-|-|-|-|-|
|Support funds of promotingforeign trade|918,600.00|—|pertinent toincome|Yes|
|Reward For Wuxi Industrialbig seller|578,000.00|—|pertinent toincome|Yes|
|Provincial Reward for R&DInstitute|250,000.00|—|pertinent toincome|Yes|
|Wuxi ScientificDevelopment Funds|250,000.00|—|pertinent toincome|Yes|
|Wuxi IndustrialDevelopment Funds|215,000.00|—|pertinent toincome|Yes|
|Reward for ‘Jiangsu PatentProject’|168,500.00|—|pertinent toincome|Yes|
|Charges For Tax Collectionfromfinance Bureau|146,177.47|177,824.08|pertinent toincome|Yes|
|Hefei self-innovationsupport fund|141,646.00|—|pertinent toincome|Yes|
|Capital Support for CleanerProduction|110,000.00|—|pertinent toincome|Yes|
|Reward for Wuxi TaihuIndustrial Design ExcellenceAward|100,000.00|—|pertinent toincome|Yes|
|Subsidies for special guide ofmodern service industry|52,800.00|52,800.00|pertinent toassets|Yes|
|Government Grant forDevelopment of substation|50,400.00|50,400.00|pertinent toassets|Yes|
|Compensation ForRelocation|—|514,349.70|pertinent toincome|Yes|
|Container DevelopmentReward|25,400.00|531,060.00|pertinent toincome|Yes|
|Special Capital Support foroutsourcing project|—|4,912,850.00|pertinent toincome|Yes|
|Scientific DevelopmentProject subsidy|—|4,894,857.82|pertinent toincome|Yes|
|Employee Settlement andpost Allowance fund|—|2,705,680.00|pertinent toincome|Yes|
|Special Fund for BusinessDevelopment|—|1,694,300.00|pertinent toincome|Yes|
|Government Grant forforeign Economies andtrades development|—|640,000.00|pertinent toincome|Yes|
|Provincial Science-andtechnology-promoting-tradesproject fund|—|500,000.00|pertinent toincome|Yes|
|Government Grants fromNew Product Reward|—|480,200.00|pertinent toincome|Yes|
|Citywide 'InternationalScience & TechnologyCooperation Scheme' Fund|—|300,000.00|pertinent toincome|Yes|
|Fund for InternationalFamous BrandsDevelopment in JiangsuProvince|—|200,000.00|pertinent toincome|Yes|
|Foreign Capital introductionRewards|—|150,000.00|pertinent toincome|Yes|
|Capital Support for Patent|—|135,400.00|pertinent to|Yes|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
||||||
|-|-|-|-|-|
||||income||
|Others|451,234.96|548,577.72|||
|Total|23,748,858.49|23,335,697.60|--|--|

 42. Non-operating expenses
Unit: yuan
|||||
|-|-|-|-|
|Item|Amount in currentperiod|Amount in last period|Amountaccounted intonon-recurringgain and loss ofcurrent period|
|Loss from disposal of non-current assets|3,962,772.35|5,461,998.05|3,962,772.35|
|Including： Loss from disposal of fixedassets|3,962,772.35|3,704,732.89|3,962,772.35|
|Penalties|398,961.70|169,742.93|398,961.70|
|Compensation costs|—|319,999.99|—|
|Donations|102,200.00|80,000.00|102,200.00|
|Local fees (Flood control &Security fund,etc.)|7,582,269.89|3,782,120.97|—|
|Others|1,149,664.63|1,074,676.85|1,149,664.63|
|Total|13,195,868.57|10,888,538.79|5,613,598.68|

43. Income tax expenses
Unit: yuan
||||
|-|-|-|
|Items|Occurred this year|Occurred last year|
|Income tax calculated according to the law andregulations in current period|142,476,837.54|62,742,475.06|
|Adjustment of differed income tax|-68,613,229.32|3,992,977.89|
|Total|73,863,608.22|66,735,452.95|

 44. Calculation of Basic EPS and diluted EPS (Earning Per Share)
（1）Results
||||
|-|-|-|
|Item|Amount in current period|Amount in last period|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
||||||||
|-|-|-|-|-|-|-|
|Profit of thereporting period|WeightedAverageROE (ReturnonShareholder’s Equity)|BasicEPS|dilutedEPS|WeightedAverage ROE(Return onShareholder’sEquity)|Basic EPS|dilutedEPS|
|Net profitattributable toordinaryshareholders of theCompany|10.88%|0.65|0.65|9.59%|0.54|0.54|
|Net profitattributable toordinaryshareholders of theCompany afterdeductingNon-recurring profitand loss|8.17%|0.49|0.49|9.69%|0.54|0.54|

（2）Calculation
|||||
|-|-|-|-|
|Item|Ref. No.|Amount in currentperiod|Amount in lastperiod|
|Net profit attributable to ordinaryshareholders of the Company|1|413,350,079.54|338,387,680.99|
|Non-recurring gain/loss attributableto the net profit ofordinary shareholders of the parentcompany after deducting of incometax influences|2|103,088,983.11|-3,591,074.37|
|Net profit attributable to ordinaryshareholders of the Company afterdeducting of non-recurringgain/loss|3=1-2|310,261,096.43|341,978,755.36|
|Total shares at beginning of year|4|632,487,764.00|632,487,764.00|
|Amount of shares transferred fromreserves or share dividend, etc.|5|-|-|
|Amount of shares increased byissuing new shares or ConvertingDebt to shares|6|-|-|
|Number of monthsfrom the nextmonth of new share issued orconverting debt to shares till end ofthe report period|7|-|-|
|Amount of shares decreased byrepurchasing of shares in the reportperiod|8|-|-|
|Number of months from the nextmonth of share decreasing to theend of report period|9|-|-|
|Amount of shares decreased in thereport period|10|-|-|
|Number of months in the report|11|12.00|12.00|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
|||||
|-|-|-|-|
|period||||
|Weighted average of outstandingordinary shares issued (I)|12=4+5+6×7÷11-8×9÷11-10|632,487,764.00|632,487,764.00|
|Weighted average of outstandingordinary shares issued adjusted forcombination under same control (II)|13|632,487,764.00|632,487,764.00|
|Basic EPS (I)|14=1÷12|0.65|0.54|
|Basic EPS(II)|15=3÷13|0.49|0.54|
|Potential delusional shares interestsrecognized as expenses|16|-|-|
|Income Tax Rate Applicable|17|15%|15%|
|Conversion Cost|18|-|-|
|Amount of shares increased byconverting or exercisingConvertible Corporate Debt,warrants, share options|19|-|-|
|Diluted EPS (I)|20=[1+(16-18)×(1-17)]÷(12+19)|0.65|0.54|
|Diluted EPS (II)|21=[3+(16-18)×(1-17)]÷(13+19)|0.49|0.54|

45. Other misc. incomes
Unit: yuan
||||
|-|-|-|
|Items|Occurred thisyear|Occurred lastyear|
|1. Gains (losses) from sellable financial assets|25,872.00|2,352.00|
|Less: Income tax influence of sellable financial assets|3,880.80|352.80|
|Sub-total|21,991.20|1,999.20|
|2. Difference from translating of foreign currency financialstatements|-938,582.67|-76,568.97|
|Sub-total|-938,582.67|-76,568.97|
|Total|-916,591.4 7|-74,569.77|

 46. Notes to the Cash Flow Statement
(1) Other cash inflow related to operation
Unit: yuan
|||
|-|-|
|Items|Amount|
|Interest income|17,642,421.68|
|Government Subsidies|23,045,658.49|
|Revenue from fines|10,798,333.04|
|Other non-operating-related cash income|320,264.06|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
|||
|-|-|
|Total|51,806,677.27|

 (2) Other cash paid related to operation
Unit: yuan
|||
|-|-|
|Items|Amount|
|Sales expense|1,027,956,765.77|
|Administrative expense|139,306,099.57|
|The amount of fee expenditures in financialexpenses|2,536,036.96|
|Fund transfer|35,089,516.78|
|Others|10,548,639.15|
|Total|1,215,437,058.23|

 47. Appendix of Cash Flow Statement
（1）Appendix of cash flow statement
Unit: yuan
||||
|-|-|-|
|Items|Closing balance|Opening balance|
|1.Net profit adjusted to cash flow of operation:|||
|Net profit|474,757,699.79|378,836,167.46|
|Plus: Asset impairment provision|49,333,919.33|8,671,358.17|
|Fixed asset depreciation, gas and petroldepreciation, production goods depreciation|118,173,198.75|118,416,902.29|
|Amortizing of intangible assets|5,680,896.86|7,679,470.84|
|Amortizing of long-term expenses|22,648,837.35|32,813,580.28|
|Loss from disposal of fixed assets, intangibleassets, and other long-term assets (“-“ for gains)|940,175.27|-7,145,341.57|
|Loss from fixed asset discard|138,614.56|—|
|Loss from fluctuation of fair value|-13,792,150.00|3,067,710.00|
|Financial expenses||—|
|Investment loss (“-“ for gains)|-116,861,930.20|-55,622,690.40|
|Decrease of deferred income tax asset (“-“ forincrease)|-70,682,051.81|4,453,134.39|
|Increase of deferred income tax liabilities (“-“ fordecrease)|2,068,822.50|-460,156.50|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
||||
|-|-|-|
|Decrease of inventory (“-“ for increase)|129,158,756.65|-154,235,526.68|
|Decrease of operational receivable items (“-“ forincrease)|-3,865,072,453.99|937,501,960.31|
|Increase of operational payable items (“-“ fordecrease)|4,168,389,765.95|-962,468,870.44|
|Others||33,250,000.00|
|Net cash flow generated by businessoperation|904,882,101.01|344,757,698.15|
|2. Investment and financing activities not involvingin cash flow|||
|Liabilities converted to capital||—|
|Convertible bond expire within 1 year||—|
|Fixed assets acquired under finance leases||—|
|3. Change of cash and cash equivalents|||
|Balance of cash at end of year|1,558,204,866.53|1,293,126,217.00|
|Less: Balance of cash at beginning of year|1,293,126,217.00|2,279,653,302.57|
|Plus: Balance of cash equivalents at end of term||—|
|Less: Balance of cash equivalents at beginningof term||—|
|Net increase of cash and cash equivalents|265,078,649.53|-986,527,085.57|

（2）Details of acquisition or disposal of subsidiaries and other operating entities in current period
Unit: yuan
||||
|-|-|-|
|Item|Amount in current period|Amount in last period|
|一、Information referring to acquisition ofsubsidiaries and other operating entities：|||
|二、Information referring to Disposal ofsubsidiaries and other operating entities：|||
|1．Consideration of subsidiaries and otheroperating entities disposed|11,424,799.57|—|
|2．Cash and Cash equivalents received from thedisposal of subsidiaries and other operating entities|11,424,799.57|—|
|Less：Cash and Cash equivalents held bysubsidiaries and other operating entities|11,424,799.57|—|
|3．Net Asset of subsidiaries disposed|11,424,799.57|—|
|Current Asset|11,424,799.57|—|

（3） Component of cash and cash equivalents
Unit: yuan
||||
|-|-|-|
|Items|Closing balance|Opening balance|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
||||
|-|-|-|
|1. Cash|1,558,204,866.53|1,293,126,217.00|
|Inclusive of： cash in treasury|21,277.15|169,620.72|
|Cash in bank|1,558,183,589.38|1,292,956,596.28|
|2. Balance of cash and cash equivalents atthe end of term|1,558,183,589.38|1,293,126,217.00|

NOTEVIII：Relationship and Related party transactions
1. Details of the parent party:
Unit:RMB(0’000)
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
|HoldingCompanyName|Relationship|BusinessType|RegistrationPlace|legalrepresentative|BusinessNature|Registered Capital|ProportionofCompanySharesHeld byparentcompany(%)|Proportion ofvotingright byparentcompany(%)|Ultimatecontroller ofthecompany|Organization Code|
||||||Manufactureand sales ofHouseholdAppliances,Motor andfittings, alongwithafter-saleservice, etc.||||||
||||Fosha||||||||
|Midea|Parent||||||||He||
|||Corpor|n,|Fang|||||||
|Group|Compan|||||168,632.34|40.08|40.08|Xiangji|72247334-4|
|||ation|Guang|Hongbo|||||||
|Co., Ltd|y||||||||an||
||||dong||||||||

2. Subsidiaries of the company
Unit:RMB(0’000)
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
|Name of theSubsidiary|Categories|Form ofbusinessorganization|RegistrationPlace|legalrepresentative|BusinessNature|RegisteredCapital|Proportion ofSharesHeld bythecompany(%)|Proportion ofvotingrightheld bythecompany(%)|Organization Code|
|Wuxi Little SwanGeneral ElectricAppliances Co. , Ltd.|Holdingsubsidiaries|LimitedCompany|Wuxi|ChaiXinjian|Manufacture|2,800.00|70.00|70.00|76355342-0|
|Wuxi Filin Electronics|Holdi|Limited|Wuxi|||||||
|Co. , Ltd.|ng|Compa||||||||
|||||Yin|Manufact|||||
||subsi|ny||||$362.46|73.00|73.00|74815875-6|
|||||Bitong|ure|||||
||diarie|||||||||
||s|||||||||
|Wuxi Little Swan|Holdi|Limited|Wuxi|Chai|Manufact|||||
|Washing Machine|ng|Compa||Xinjian|ure|||||
|||||||4967.95|99.91|99.91|60792331-1|
|Co. , Ltd.|subsi|ny||||||||
||diarie|||||||||

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
||s|||||||||
|Wuxi Meitian|Holdi|Limited|Wuxi|Chai|Sale|||||
|Refrigerator Market|ng|Compa||Xinjian||||||
|Co., Ltd.|subsi|ny||||$400|75.00|75.00|71490141-7|
||diarie|||||||||
||s|||||||||
|Jiangsu Little Swan|Holdi|Limited|Wuxi|Chai|Sale|||||
|Marketing and Sales|ng|Compa||Xinjian||||||
|Co. , Ltd.|subsi|ny||||41,950.00|99.63|99.63|73330538-9|
||diarie|||||||||
||s|||||||||
|Wuxi Little Swan|Holdi|Limited|Wuxi|||||||
|Import & Export Co. ,|ng|Compa||||||||
|||||Yin|Import|||||
|Ltd|subsi|ny||||6,500.00|88.46|88.46|13600714-8|
|||||Bitong|and export|||||
||diarie|||||||||
||s|||||||||
|Little Swan|Whol|Limited||||||||
||||Singa||Investmen|||||
|International|ly-ow|Compa||||$500|100|100||
||||pore||t|||||
|(Singapore) Co., Ltd.|ned|ny||||||||
||Whol|||||||||
|Tianjin Little Swan||Limited||||||||
||||Tianji|Chai|Manufact|||||
|Washing Machine Co.,|ly-ow|Compa||||20,000|100|100|57230359-2|
||||n|Xinjian|ure|||||
|Ltd.|ned|ny||||||||
|Little Swan (Jing||||||||||
||Whol|Limited||||||||
|Zhou) Sanjin|||Jingz|Yin|Manufact|||||
||ly-ow|Compa||||1,107.02|100|100|72614223-5|
|Electronic Appliances|||hou|Bitong|ure|||||
||ned|ny||||||||
|Co., Ltd.||||||||||
||Holdi|Limited||||||||
||ng|Compa||||||||
|Hefei Midea Washing||||Yin|Manufact|||||
||subsi|ny|Hefei|||$13,552|69.47|69.47|14906761-7|
|Machine Co., Ltd.||||Bitong|ure|||||
||diarie|||||||||
||s|||||||||
||Holdi|Limited||||||||
|Hefei Midea Washing|ng|Compa||||||||
|||||Yin|Manufact|||||
|Machine Manufacture|subsi|ny|Hefei|||2,000|90|90|67423819-7|
|||||Bitong|ure|||||
|Co., Ltd.|diarie|||||||||
||s|||||||||

3. Associated enterprise of the company
Unit: yuan
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
|Name of Investee|Form ofbusinessorganization|Registered place|Corporaterepresentative|BusinessNature|RegisteredCapital|Proportions of thecompany’sshareholding to theinvestee(%)|Proportions ofthe company’svoting right tothe investee(%)|Relationship|OrganizationCode|
|1.Associated enterprise||||||||||
|Guangzhou Antaida|Limited|||||||Asso||
|||Guang|Ye|||||||
|Material Distribution Co. ,|Compan|||logistics|10,000,000|20|20|ciate|72993557-2|
|||zhou|Weilong|||||||
|Ltd.|y|||||||d||

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 4. Other related parties of the company
|||||
|-|-|-|-|
|Name|Relationship to the Company|OrganizationCode||
|Midea Group Finance Co., Ltd|Controlled by controlling shareholders of the Company|55912326-3||
|Hefei Midea Materials Supply Co. , Ltd.|Controlled by controlling shareholders of the Company|55183611-1||
|Hefei Midea Refrigerator Co., Ltd|Controlled by controlling shareholders of the Company|14906759-6||
|Hefei Hualing Corporation|Controlled by controlling shareholders of the Company|61031550-1||
|Guangdong Midea Heating Equipment||||
||Controlled by controlling shareholders of the Company|78115339-1||
|Co., Ltd||||
|Midea (Singapore) Trading Co., Ltd.|Controlled by controlling shareholders of the Company|||
|PT. Midea Planet Indonesia|Participated by controlling shareholders of the Company|||
|MIDEA SCOTT & ENGLISH SDN||||
||Participated by controlling shareholders of the Company|||
|BHD||||
|MIDEA ITALIA S.R.L.|Controlled by controlling shareholders of the Company|||
|Midea Household Equipment (Vietnam)||||
||Controlled by controlling shareholders of the Company|||
|Co., Ltd||||
|Hefei Century|Controlled by immediate family member of|||
|||66293360-0||
|Molding Technology Co., Ltd|Ultimate controller of the company|||
||Controlled by immediate family member of|||
|Hefei Huitong New Materials Co., Ltd||67759766-2||
||Ultimate controller of the company|||
|Zhongshan Midea Environmental||||
|electrical engineering products|Controlled by controlling shareholders of the Company|68445743-0||
|Installation Services Co., Ltd.||||
|Guangdong GANEY Precision||||
||Controlled by controlling shareholders of the Company|72111191-5||
|Machinery Co., Ltd||||
|Foshan Shunde Century Technology||||
||Controlled by controlling shareholders of the Company|70807868-X||
|Co., Ltd.||||
|Foshan Shunde Century Development||||
||Controlled by controlling shareholders of the Company|79462671-7||
|Plastics Co., Ltd||||
|Ningbo Ande Logistics Co., Ltd|Controlled by controlling shareholders of the Company|57051088-9||
|Huai’an Weiling motor manufacture Co.,||||
||Controlled by controlling shareholders of the Company|75968160-6||
|Ltd||||
|Hubei Midea refrigerator Co., Ltd|Controlled by controlling shareholders of the Company|70696333-5||
|Wuhu Century Technology||||
||Controlled by controlling shareholders of the Company|75096265-5||
|Development Co., Ltd.||||
|Wuhu Andhra Logistics Co., Ltd.|Controlled by controlling shareholders of the Company|71992943-5||
|Wuhu air conditioning equipment Co.,||||
||Controlled by controlling shareholders of the Company|55458322-8||
|Ltd||||
|Wuhu Midea Kitchen appliances||||
||Controlled by controlling shareholders of the Company|67890503-0||
|Manufacture Co., Ltd||||
|Wuhu Midea Household Appliance Mar||||
||Controlled by controlling shareholders of the Company||67890505-7|
|keting Co., Ltd||||
|Guangdong Midea Group Wuhu||||
||Controlled by controlling shareholders of the Company|70490853-5||
|Refrigerator Euipment Co., Ltd||||
|Guangdong Midea Refrigerator||||
||Controlled by controlling shareholders of the Company|72547107-X||
|Euipment Co., Ltd||||

5. Related Party Transactions
(1) Purchase of goods, services received from the related-party
Unit: yuan
||||||||
|-|-|-|-|-|-|-|
|Related-party|Related-partyTransactions|Pricingmethod anddecision|Amount in current period||Amount in last period||
||||Amount|Percentage of|Amount|Percentage of|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
||||||||
|-|-|-|-|-|-|-|
|||makingprocess ofrelated partytransactions||totalsimilartransactions（%）||totalsimilartransactions（%））|
|Huai’an Welling MotorManufacturing Co., Ltd.|Electricengines andmaterials|Marketprice|427,047,526.03|7.10|363,677,042.18|7.18|
|Hefei Midea Materials Supply|Materials|Market|||||
||||376,568,034.51|6.26|344,004,324.75|6.80|
|Co., Ltd.|purchase|price|||||
|Ningbo Ande Logistics Co.,||Market|||||
||Logistics||98,886,953.53|1.64|60,504,801.61|1.20|
|Ltd||price|||||
|Hefei Huitong New Materials|Materials|Market|||||
||||—|—|81,120,196.78|1.60|
|Co., Ltd|purchase|price|||||
|Hefei Century molding|Materials|Market|||||
||||54,490,149.68|0.91|80,541,848.99|1.59|
|Development Co., Ltd.|purchase|price|||||
|Wuhu Midea Home Appliance|Procurement|Market|||||
||||11,408,443.41|0.19|—|—|
|Marketing Co., Ltd|of Goods|price|||||
|Hubei Midea Refrigerator|M aterials|Market|||||
||||9,236,027.91|0.15|—|—|
|Co., Ltd|purchase|price|||||
||Materials|Market|||||
|Hefei Hualing Corporation|||2,325,941.02|0.04|70,316.47|—|
||purchase|price|||||
|Wuhu Andhra Logistics Co.,||Market|||||
||Logistics||963,854.49|0.02|224,378.68|0.01|
|Ltd||price|||||
|Hefei Midea Refrigerator Co.,|Materials|Market|||||
||||46,115.38|—|—|—|
|Ltd|purchase|price|||||
|Total|||980,973,045.96|16.31|930,179,582.30|18.38|

 Sale of goods, services provided to the related-party
Unit: yuan
||||||||
|-|-|-|-|-|-|-|
|Related-party|Related-partyTransactions|Pricingmethodanddecisionmakingprocess ofrelatedpartytransactions|Amount in current period||Amount in last period||
||||Amount|Percentageof totalsimilartransactions（%）|Amount|Percentage oftotal similartransactions（%）|
||Sales of||||||
|Midea (Singapore) Trading||Market|||||
||Washing||1,112,577,724.98|12.75|1,088,619,499.50|15.78|
|Co., Ltd.||Price|||||
||Machine||||||
||Sales of||||||
|||Market|||||
|MIDEA SCOTT & ENGLISH SDN BHD|Washing||23,385,473.81|0.27|26,471,058.09|0.38|
|||Price|||||
||Machine||||||
|Hefei Century molding|Sales of|Market|||||
||||20,550,778.14|0.24|59,308,524.14|0.86|
|Development Co., Ltd.|Materials|Price|||||
||Sales of||||||
|||Market|||||
|PT. Midea Planet Indonesia|Washing||11,489,166.47|0.13|16,077,304.14|0.23|
|||Price|||||
||Machine||||||
||Sales of||||||
|Midea Household Equipment||Market|||||
||Washing||2,561,882.76|0.03|—|—|
|(Vietnam) Co., Ltd||Price|||||
||Machine||||||

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
||||||||
|-|-|-|-|-|-|-|
||Sales of|Market|||||
|Hefei Hualing Corporation|||331,865.92|—|9,446,882.46|0.14|
||Materials|Price|||||
|Huai’an Welling Motor|Sales of|Market|||||
||||198,468.28|—|—|—|
|Manufacturing Co., Ltd.|Materials|Price|||||
|Hefei Huitong New Materials|Sales of|Market|||||
||||—|—|22,947,393.15|0.33|
|Co., Ltd|Materials|Price|||||
|Hefei Midea Refrigerator Co.,|Sales of|Market|||||
||||28,879.20|—|2,599,345.67|0.04|
|Ltd|Materials|Price|||||
|Guangdong Midea Heating|Sales of|Market|||||
||||—|—|848.16|—|
|Equipment Co., Ltd|Materials|Price|||||
|Total|||1,171,124,239.|5 1 3.42|1,225,470,855.|17.76|

 (2) Related-party guarantee
No Related-party guarantee is out of consolidation scope.
(3) Asset Transfer and Debt Reconstruction with related parties
Unit：yuan
|||||||||
|-|-|-|-|-|-|-|-|
|Related-party|Related-partytransactiontype|Related-partyTransactions|PricingMethodof Relatedpartytransactions|Amount in current period||Amount in last period||
|||||Amount|Percentage oftotalsimilartransactions（%）|Amount|Percentage oftotalsimilartransactions（%）|
|Foshan Shunde CenturyDevelopment PlasticsCo., Ltd|AssetTransfer|Disposal ofEquipment|MarketPrice|3,249,127.47|3.42|—|—|
|Wuhu CenturyTechnologyDevelopment Co., Ltd.|AssetTransfer|Disposal ofEquipment|MarketPrice|2,293,061.07|2.41|—|—|
|Foshan Shunde CenturyTechnology Co., Ltd.|AssetTransfer|Disposal ofEquipment|MarketPrice|2,240,656.53|2.36|—|—|
|Wuhu Midea Kitchenappliances ManufactureCo., Ltd|AssetTransfer|Disposal ofEquipment|MarketPrice|1,218,032.59|1.28|—|—|
|Handan Midearefrigerator Co., Ltd|AssetTransfer|Disposal ofEquipment|MarketPrice|840,577.60|0.89|—|—|
|Guangdong MideaHeating Equipment Co.,Ltd|AssetTransfer|Disposal ofEquipment|MarketPrice|—|—|383,283.04|7.45|
|Guangdong GANEYPrecision Machinery Co.,Ltd|AssetTransfer|AcquisitionofEquipment|MarketPrice|208,310.26|0.54||—|
|Foshan Shunde CenturyTechnology Co., Ltd.|AssetTransfer|AcquisitionofEquipment|MarketPrice|29,914.53|0.08||—|
|Hefei HualingCorporation|AssetTransfer|AcquisitionofEquipment|MarketPrice|28,888.89|0.08||—|
|Wuhu MeizhiAir-conditioning|AssetTransfer|Acquisitionof|MarketPrice|22,478.63|0.06|—|—|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
|||||||
|-|-|-|-|-|-|
|Equipment Co., Ltd|Equipment|||||
|Total||10,131,047.57|11.12|383,283.04|7.45|

 (4)Other Transactions with Related Parties
Unit：yuan
||||||
|-|-|-|-|-|
|Related Parties|Related-partytransaction|Related-partytransactionPricingMethod|Amount in currentperiod|Amount in Lastperiod|
|Guangdong MideaRefrigerator Euipment Co.,Ltd|Trademark LicensingPayment|NegotiatedPrice|138,308.22|—|
|Hubei Midea refrigeratorCo., Ltd|Trademark LicensingPayment|NegotiatedPrice|332,226.54|2,985,936.62|
|Guangdong Midea GroupWuhu RefrigeratorEuipment Co., Ltd|Trademark LicensingPayment|NegotiatedPrice|1,230,743.90|—|
|Midea Group Co., Ltd|Trademark LicensingPayment|NegotiatedPrice|—|5,749,300.00|
|Midea Group Co., Ltd|Trademark LicensingPayment|NegotiatedPrice|2,315,938.74|6,836,492.37|
|Midea Group Co., Ltd|project trusteeshippayment|NegotiatedPrice|—|36,672.84|

6. Amount due to/from related parties
(1) Amount due from related parties
Unit: yuan
|||||||
|-|-|-|-|-|-|
|Item|Related parties|Closing Balance||Opening Balance||
|||Book Value|Bad DebtProvision|Book Value|Bad DebtProvision|
|AccountsReceivable|Midea (Singapore) TradingCo., Ltd.|216,980,362.32|10,802,299.01|226,480,645.57|11,324,830.37|
|AccountsReceivable|MIDEA SCOTT & ENGLISH SDN BHD|10,020,687.97|125,393.20|9,162,679.13|458,133.96|
|AccountsReceivable|PT. Midea Planet Indonesia|2,507,863.97|501,034.40|12,244,315.71|612,215.79|
|AccountsReceivable|Hefei Hualing Corporation|—|—|461,954.29|25,921.50|
|AccountsReceivable|Guangdong Midea HeatingEquipment Co., Ltd|—|—|383,283.04|19,164.15|
|Accounts||||||
||MIDEA ITALIA S.R.L.|—|—|706,673.25|70,667.33|
|Receivable||||||
|Accounts|Hubei Midea Refrigerator Co.,|||||
|||—|—|55,579.28|2,778.96|
|Receivable|Ltd.|||||
|Accounts|Midea Household Equipment|||||
|||4,651.08|232.55|—|—|
|Receivable|(Vietnam) Co., Ltd|||||
|Accounts|Hefei Midea Refrigerator Co.,|||||
|||1,788.06|357.61|43,547.38|2,777.66|
|Receivable|Ltd|||||
||Total|229,515,353.40|11,429,316.77|249,538,677.65|12,516,489.72|
||Hefei Midea Materials Supply|||||
|Prepayment||3,074,917.50||||
||Co. , Ltd.|||||
|Prepayment|Ningbo Andhra Logistics Co.,|16,406.87||||

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
|||
|-|-|
|Ltd.||
|Total|3,091,324.37|

(2) Amount due to related parties
Unit: yuan
|||||
|-|-|-|-|
|Item|Related parties|Closing Balance|Opening Balance|
|AccountsPayable|Hefei Midea Materials SupplyCo. , Ltd|60,510,586.85|7,956,562.94|
|AccountsPayable|Huai’an Weiling motormanufacture Co., Ltd|39,169,018.59|40,022,965.01|
|Accounts||||
||Hefei Hualing Corporation|510,238.62|—|
|Payable||||
|Accounts||||
||Hubei Midea refrigerator Co., Ltd|291,120.87|—|
|Payable||||
|Accounts|Foshan Shunde Century|||
|||276,400.00|—|
|Payable|Technology Co., Ltd|||
|Accounts|Hefei Century Molding|||
|||172,082.75|15,932,705.63|
|Payable|Development Co., Ltd|||
|Accounts||||
||Ningbo Andhra Logistics Co., Ltd|144,787.50|331,939.49|
|Payable||||
|Accounts||||
||Wuhu Andhra Logistics Co., Ltd.|90,630.06|784,905.06|
|Payable||||
|Accounts|Hefei Huitong New Materials|||
|||—|1,420,794.54|
|Payable|Co., Ltd|||
|Accounts|Zhongshan Midea Environmental|||
|Payable|electric engineering product|—|137,032.00|
||installation Co., Ltd|||
|Accounts|Guangdong GANEY Precision|||
|||—|85,200.00|
|Payable|Machinery Co., Ltd|||
||Total|101,164,865.24|66,672,104.67|
|Advance||||
||Midea (Singapore) Trading Co.,|||
|From||56,655,613.54|—|
||Ltd|||
|Customers||||
|Advance||||
|From|MIDEA SCOTT & ENGLISH SDN BHD|30,931.47|27,139.93|
|Customers||||
||Total|56,686,545.01|27,139.93|
|Other||||
|Accounts|Midea Group Co., Ltd|390,636.00|390,636.00|
|Payable||||
||Total|390,636.00|390,636.00|

 NoteIX、Contingency
1、Contingent Liability arisen from pending lawsuits or arbitrament and financial effect
(1) Hefei baiyan Feilong construction materials Co., Ltd Apply for litigation preservation
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 to Anhui Feixi county people's court due to dispute over construction Contract between Jiangsu Hongda Construction Group Co., Ltd and Hefei Midea Refrigerator Co., Ltd. In which case, Cash in Bank totals 650,000 Yuan of Hefei Midea Refrigerator Co., Ltd, subsidiary of the company, is frozen.
2、Other Contingent Liability and Financial effect
(1)Due to operating capital requirement and development need, the Company offer guarantee over 103.4357 millionbank’s acceptance bill of Hefei Midea Refrigerator Co., Ltd. (2)The Company pledged 10.9256 million of guarantee deposit in Bank of China Ltd. Wuxi Branch to obtainbank’s acceptance bill.
(3) The Company pledged 3.5421 million of guarantee deposit in China Construction Bank Corporation Wuxi Branch to obtainbank’s acceptance bill.
(4) The Company pledged 10.10 million of guarantee deposit in Agricultural Bank of China Ltd. Wuxi New District Branch to obtainbank’s acceptance bill.
(5) The Company pledged 3.3448 milion of guarantee deposit in China Merchants Bank Co., Ltd Wuxi Branch to obtainbank’s acceptance bill.
NoteX：Commitment
issues
By the date of 31 Dec, 2013, no significant commitment issues shall be disclosed.
NoteXI： Commitment issues
As of December 31, 2012, no significant commitment issues should be disclosed.
NoteXII.：Events after balance sheet date
1. Allocation of profits after balance sheet date
Unit: yuan
|||
|-|-|
|The profits or dividends to be distributed|189,746,329.20|
|The profits or dividends declared to be distributed upon deliberation|189,746,329.20|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
||
|-|
|and approval under the profit distribution plan|

2. Approved by Company Resolution, the company decided to close down Tianjin Little Swan Refrigerator Co., Ltd, subsidiary of the company. On 28 Jan, 2014, Tianjin Little Swan Refrigerator Co., Ltd cancelled its registration
3. Ruled by Jiangsu Wuxi Intermediate People's Court on 21 Feb, 2014, Wuxi Little Swan Washing Machine Co., Ltd go into bankruptcy.
Note XIII: Other significant events
1、Asset and Liability measured at Fair Value
Unit：yuan
|||||||
|-|-|-|-|-|-|
|Items|Opening balance|Profit or loss onfair value changeon Asset andLiability|Accumulated fairvalue changesthrough equity|ImpairmentProvisionaccrued ofcurrent period|Closing balance|
|Financial assets||||||
|1. Derivatives -Forward foreignexchange contracts|1,224,590.00|13,792,150.00|—|—|15,016,740.00|
|2. Financial assetsavailable for sale|286,944.00|25,872.00|180,638.60|—|312,816.00|
|Subtotal of FinancialAsset|1,511,534.00|13,818,022.00|180,638.60|—|15,329,556.00|

2、Financial assets and financial liabilities in foreign currency
Unit：yuan
|||||||
|-|-|-|-|-|-|
|Items|Opening balance|Profit or loss onfair value changeon Asset andLiability|Accumulatedfair valuechanges throughequity|ImpairmentProvisionaccrued ofcurrent period|Closing balance|
|Financial assets||||||
|1. Derivatives -Forward foreignexchange contracts|1,224,590.00|13,792,150.00|—|—|15,016,740.00|
|Subtotal of FinancialAssets|1,224,590.00|13,792,150.00|—|—|15,016,740.00|

Note XIV: Notes to the financial statements of parent Company
1. Accounts receivable
(1) category analysis:
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012Unit：yuan
||||||||||
|-|-|-|-|-|-|-|-|-|
|Categories|Closing Balance||||Opening Balance||||
||Book Value||Bad Debt Provision||Book Value||Bad Debt Provision||
||Amount|(%)|Amount|(%)|Amount|(%)|Amount|(%)|
|Individuallysignificant accountsreceivable on whichthe bad debtprovisions areprovided individually|—|—|—|—|—|—|—|—|
|Accounts receivable on which the bad debt provisions are provided by asset combinations|||||||||
|Combination1：Aging|404,535,014.38|52.60|20,348,820.07|5.03|333,592,268.24|99.74|17,836,822.90|5.35|
|Combination 2：Accounts receivable inConsolidation Scope|347,260,005.38|45.16|—|—|—|—|—|—|
|Subtotal|751,795,019.76|97.76|20,348,820.07|2.71|333,592,268.24|99.74|17,836,822.90|5.35|
|Accounts receivablewhich are notindividuallysignificant yet baddebt provisions areprovided individually|17,241,527.92|2.24|17,241,527.92|100.00|861,084.02|0.26|861,084.02|100|
|Total|769,036,547.68|100|37,590,347.99|4.89|334,453,352.26|100|18,697,906.92|5.59|

 Categories of accounts receivable
There were no individually significant accounts receivable on which the bad debt provisions are provided individually in the reporting period.
Individually significant accounts receivable on which the bad debt provisions are provided individually at the balance sheet date
□ Applicable√ Not Applicable
Accounts receivable on which the bad debt provisions are provided by combinations according to age
√ Applicable□ Not Applicable
Aginganalysis：
Unit：yuan
||||||||
|-|-|-|-|-|-|-|
|Aging|Closing Balance|||Opening Balance|||
||Book Value||Bad debtprovisions|Book Value||Bad debtprovisions|
||Amount|(%)||Amount|(%)||
|Within 1 year|402,093,647.22|99.40|20,104,682.36|325,737,081.06|97.65|16,286,854.06|
|1-2 years|2,441,359.96|0.60|244,136.00|210,685.97|0.06|21,068.60|
|2-3 years|6.53|—|1.31|7,644,501.21|2.29|1,528,900.24|
|Over 3 Years|0.67|—|0.40|—|—|—|
|Total|404,535,014.38|100|20,348,820.07|333,592,268.24|100|17,836,822.90|

 Accounts receivable on which the bad debt provisions are provided by combinations according to balance percentage method
□ Applicable√ Not Applicable
Accounts receivable on which the bad debt provisions are provided by combinations with other methods□ Applicable√ Not Applicable
Accounts receivable which are not individually significant, but still the bad debt provisions are provided
individually at the balance sheet date
√ Applicable□ Not Applicable
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 Accounts receivable which are not individually significant yet bad debt provisions are provided
individually at the end of the period
Unit：yuan
||||||
|-|-|-|-|-|
|Details|Book Value|Bad debtprovisions|Provision Rate（%）|Reason|
|China Nuclear Power EngineeringCo., Ltd|2,367,588.00|2,367,588.00|100|Uncollectable|
|Chongqing Taizheng (Group) Co.,Ltd|1,851,500.00|1,851,500.00|100|Uncollectable|
|Chongqing Fuli Real-estateDevelopment Co., Ltd|1,675,800.00|1,675,800.00|100|Uncollectable|
|Chongqing Zhongcheng PropertyDevelopment Co., Ltd|1,655,000.00|1,655,000.00|100|Uncollectable|
|Headquarters of Hangzhou West LakeXixi Wetland ComprehensiveProtection Program|1,427,004.00|1,427,004.00|100|Uncollectable|
|Hunan Huitang Hot spring HuatianProperties Co., Ltd with other 63Companies|8,264,635.92|8,264,635.92|100|Uncollectable|
|Total|17,241,527.92|17,241,527.92|--|--|

 (2) Written-off Accounts Receivable in current reporting period
Unit：yuan
|||||||
|-|-|-|-|-|-|
|Company Name|Nature ofAccountsReceivable|Written-off Date|Written-offAmount|Reason|Accountsreceivable arisenfromrelated-partytransactions|
|Wuxi Shengchaopetrochemical andmetallurgical equipmentFactory|Paymentsfor Goods|Oct 2013|140,084.02|ExpectedUncollectableitem|No|
|Total|||140,084.02|||

(3) Accounts receivable due from shareholders with more than5% (including5%) of the voting shares of the Company.
None.
(4) Information of Companies where Top 5 significant in amount Accounts Receivable due from Unit:yuan
||||||
|-|-|-|-|-|
|Company Name|Relationshipto theCompany|Amount|Aging|Percentage oftotal Amount (%)|
|Hefei Midea Washing Machine Co., Ltd|Subsidiary|347,260,005.38|Within 1 year|45.15|
|Suning Procurement Centre of SuningCommerce Group Co., Ltd|Distributor|144,834,803.71|Within 1 year|18.83|
|HOME RETAIL GROUP|Distributor|21,365,254.06|Within 1 year|2.78|
|Kunming Midea Refrigeration ProductMarketing Co., Ltd|Distributor|16,175,173.75|Within 1 year|2.10|
|Jilin Midea Refrigeration Product MarketingCo., Ltd|Distributor|15,735,714.19|Within 1 year|2.05|
|合计||545,370,951.09||70.92|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 (5) Details of accounts receivables from related parties
Unit: yuan
|||||
|-|-|-|-|
|Company Name|Relationship to the Company|Amount|Percentage of totalAmount (%)|
|Hefei Midea Washing Machine Co.,Ltd|Holding Subsidiary|347,260,005.38|45.15|
|PT. Midea Planet Indonesia|Participated by ControllingShareholder of the Company|1,376,096.42|0.18|
|MIDEA SCOTT & ENGLISH SDN BHD|Participated by ControllingShareholder of the Company|152,489.63|0.02|
|Midea (Singapore) Trading Co.,Ltd.|Held by ControllingShareholder of the Company|76,989.52|0.01|
|Total||348,865,580.95|45.36|

 2. Other receivables
(1) category analysis:
Unit: yuan
||||||||||
|-|-|-|-|-|-|-|-|-|
|Categories|Closing Balance||||Opening Balance||||
||Carrying Amount||Bad Debt Provision||||Carrying Amount||
||Amount|(%)||Amount|(%)||Amount|(%)|
|Individuallysignificant otherAccounts receivableson which the bad debtprovisions areprovided individually|—|—|—|—|—|—|—|—|
|Other Accounts receivable for which the bad debt provisions are provided on asset combinations|||||||||
|Combination 1: Aging|20,350,003.60|20.45|1,597,802.77|7.85|17,806,355.81|16.26|3,787,364.45|21.27|
|Combination 2：OtherAccounts Receivablein ConsolidationScope|79,150,338.65|79.55|79,150,338.65|100.00|91,716,023.13|83.74|91,637,472.43|99.91|
|Subtotal|99,500,342.25|100.00|80,748,141.42|81.15|109,522,378.94|100|95,424,836.88|87.13|
|Other Accountsreceivable which arenot individuallysignificant yet baddebt provisions areprovided individually|—|—|—|—|—|—|—|—|
|Total|99,500,342.25|100|80,748,141.42|81.15|109,522,378.94|100|95,424,836.88|87.13|

 Categories of other receivables
There were no individually significant other receivables on which the bad debt provisions are provided individually in the reporting period.
Individually significant other receivables on which the bad debt provisions are provided individually at the balance sheet date
□ Applicable√ Not Applicable
Other receivables on which the bad debt provisions are provided by combinations according to age
√ Applicable□ Not Applicable
Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 Aging analysis for combination according to accountage：
Unit:yuan
||||||||
|-|-|-|-|-|-|-|
|Aging|Closing Balance|||Opening Balance|||
||Book Value||Bad DebtProvision|Book Value||Bad DebtProvision|
||Amount|(%)||Amount|(%)||
|Within 1 Year|18,164,493.72|89.26|908,224.69|11,323,747.98|63.59|566,187.40|
|1-2 Years|1,145,035.00|5.62|114,503.50|532,175.30|2.99|53,217.53|
|2-3 Years|165,000.00|0.81|33,000.00|1,034,500.00|5.81|206,900.00|
|3-5 Years|833,500.76|4.10|500,100.46|4,887,182.53|27.45|2,932,309.52|
|Over 5 Years|41,974.12|0.21|41,974.12|28,750.00|0.16|28,750.00|
|Total|20,350,003.60|100|1,597,802.77|17,806,355.81|100|3,787,364.45|

 Other receivables on which the bad debt provisions are provided by combinations according to balance percentage method
□ Applicable√ Not Applicable
Other receivables on which the bad debt provisions are provided by combinations with other methods
□ Applicable√ Not Applicable
Other receivables which are not individually significant, but still the bad debt provisions are provided
individually at the balance sheet date
√ Applicable□ Not Applicable
(2) Other receivables written off in current period:
Unit:yuan
|||||||
|-|-|-|-|-|-|
|Company Name|Nature of OtherAccountsReceivable|Date ofWritten off|AmountWritten off|Reason|Other Accountreceivables arisenfrom related partytransactions|
|Wuxi MeitianRefrigeratorMarketing Co.,Ltd|Receivable|Oct 2013|10,968,856.34|Uncollectable|No|
|GuangzhouShibang HumanResource Co., Ltd|Receivable|Oct 2013|399,265.05|Uncollectable|No|
|Wuxi Maple SoftElectronics Co.,Ltd|Receivable|Oct 2013|21,600.00|Uncollectable|No|
|Suzhou HuichuanElectromechanicalCo., Ltd|Receivable|Oct 2013|51,000.00|Uncollectable|No|
|Total|--|--|11,440,721.39|--|--|

(3) Other Accounts Receivable due from shareholders with over5% (Including5%) in the
reporting period
None.
(4) The information list for the top 5 customers:
Unit:yuan
||||||
|-|-|-|-|-|
|Entity Name|Relationshipto thecompany|Amount|Aging|Percentage oftotal Amount ofOther AccountReceivables(%)|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
||||||
|-|-|-|-|-|
|Jiangsu Little Swan Marketing Co., Ltd|Subsidiary|74,645,177.68|1-2Years|75.02|
|Ministry of Industry and Information|GovernmentDepartment|10,152,391.10|With 1Year|10.20|
|Wuxi Little Swan Imports & Exports Co., Ltd|Subsidiary|1,108,162.95|Within2Years|1.11|
|Wuxi Little Swan Sutai Washing Machine Co., Ltd|Subsidiary|3,396,998.02|Within4Years|3.42|
|Wuxi China Resources Gas Co., Ltd|Cooperators|926,391.20|Within1 Year|0.93|
|Total||90,229,120.95||90.68|

（5） Other receivables due from related parties
Unit: yuan
|||||
|-|-|-|-|
|Entity Name|Relationship to thecompany|Amount|Proportion of totalAccounts Receivable(%)|
|Jiangsu Little Swan MarketingCo., Ltd|Subsidiary|74,645,177.68|75.02|
|Wuxi Little Swan WashingMachinery Co., Ltd|Subsidiary|3,396,998.02|3.41|
|Hefei Midea WashingMachine Co., Ltd|Subsidiary|1,200,000.00|1.21|
|Wuxi Little Swan Imports &Exports Co., Ltd|Subsidiary|1,108,162.95|1.11|
|Total|--|80,350,338.65|80.75|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 3. Long-term equity investment
Unit：yuan
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
|Company|Method|Amount ofInitialinvestment|Openingbalance|Increase/Decrease|Closingbalance|Proportions ofshareholding (%)|Proportions ofvotingRights(%)|Note forDifferencebetweenproportions of votingrights andshareholding|Provision forimpairment|ImpairmentProvisionAccruedof currentperiod|Cashdividends incurrentperiod|
|Guangzhou AntaidaLogistics Co., Ltd|EquityMethod|2,000,000.00|3,285,850.80|-116,701.92|3,169,148.88|20.00|20.00|--|--|--|--|
|Wuxi Little SwanImport & Export Co.,Ltd.|CostMethod|57,500,000.00|57,500,000.00|--|57,500,000.00|88.46|88.46|--|--|--|--|
|Wuxi Little SwanWashing MachineryCo., Ltd|CostMethod|37,259,587.50|37,259,587.50|-37,259,587.50|--|75.00|75.00|--|37,259,587.50|37,259,587.50|--|
|Wuxi MeitianRefrigerator Marketingand sale Co., Ltd.|CostMethod|24,840,000.00|24,840,000.00|-24,840,000.00|--|75.00|75.00|--|24,840,000.00|24,840,000.00|--|
|Jiangsu Little SwanMarketing and SalesCo. , Ltd.|CostMethod|417,550,000.00|417,550,000.00|--|417,550,000.00|99.54|99.54|--|--|--|--|
|Wuxi Filin ElectronicsCo. , Ltd.|CostMethod|25,630,294.47|25,660,308.10|--|25,660,308.10|73.00|73.00|--|--|--|--|
|Wuxi Little SwanGeneral ElectricAppliances Co. , Ltd.|CostMethod|19,600,000.00|19,600,000.00|--|19,600,000.00|70.00|70.00|--|--|--|--|
|San Jin (Jing Zhou)Electrical Appliances|CostMethod|11,869,431.12|11,869,431.12|--|11,869,431.12|100.00|100.00|--|--|--|--|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
|Wuxi Little SwanDriving & ControlDevelopmentTechnology Co. , Ltd.|CostMethod|4,500,000.00|4,500,000.00|-4,500,000.00|--|--|--|--|--|--|--|
|Little SwanInternational(Singapore) Co., Ltd.|CostMethod|34,052,500.00|34,052,500.00|--|34,052,500.00|100.00|100.00|--|--|--|--|
|Hefei MideaWashing Machine Co.,Ltd|CostMethod|830,962,252.35|830,962,252.35|--|830,962,252.35|69.47|69.47|--|--|--|--|
|P.T. Little Swan PrimaIndustries (Malaysia)|CostMethod|4,224,744.00|--|--|--|--|--|--|--|--|--|
|Tianjin Little SwanWashing Machine Co.,Ltd.|CostMethod|200,000,000.00|200,000,000.00|--|200,000,000.00|100.00|100.00|--|--|--|--|
|Hengtai InsuranceBrokers Ltd.|CostMethod|1,000,000.00|1,000,000.00|-1,000,000.00|--|--|--|--|--|--|--|
|Suzhou People'sShopping Centre(100,000 shares)|CostMethod|150,000.00|150,000.00|--|150,000.00|-|-|--|--|--|50,000.00|
|Bank of Jiangsu(2,202,564 shares)|CostMethod|1,210,000.00|1,210,000.00|--|1,210,000.00|-|-|--|--|--|123,405.12|
|Total|--|1,672,348,809.44|1 ,669,439,929.87|-67,716,289.42|1 ,601,723,640.45| --|--|--|62,099,587.50|62,099,587.50|173,405.12|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012 4.Operational turnover and costs
(1) Operational turnover and costs
Unit: yuan
||||
|-|-|-|
|Items|Occurred this year|Occurred last year|
|Main business income|5,914,345,955.43|4,074,944,500.64|
|Other operating income|427,951,602.48|397,582,914.05|
|Total|6,342,297,557.91|4,472,527,414.69|
|Operation cost|4,842,224,381.25|3,374,118,170.00|

（2）Mainoperation（Categorize byindustries）
Unit: yuan
||||||
|-|-|-|-|-|
|Name of industry|Occurred this year||Occurred last year||
||Operating revenue|Operating cost|Operating revenue|Operating cost|
|Household appliancesmanufacture|5,914,345,955.43|4,443,120,274.56|4,074,944,500.64|3,012,031,852.16|
|Total|5,914,345,955.43|4,443,120,274.56|4,074,944,500.64|3,012,031,852.16|

（3）Mainoperation（Categorize byproducts）
Unit: yuan
||||||
|-|-|-|-|-|
|Name of products|Occurred this year||Occurred last year||
||Operating revenue|Operating cost|Operating revenue|Operating cost|
|Washing machines|5,914,345,955.43|4,443,120,274.56|4,074,944,500.64|3,012,031,852.16|
|Total|5,914,345,955.43|4,443,120,274.56|4,074,944,500.64|3,012,031,852.16|

（4）Mainoperation（Categorize byregions）
Unit: yuan
||||||
|-|-|-|-|-|
|Name of regions|Occurred this year||Occurred last year||
||Operating revenue|Operating cost|Operating revenue|Operating cost|
|Homeland|5,338,313,710.54|3,900,625,027.73|3,505,118,756.45|2,421,497,568.72|
|Other countries|576,032,244.89|542,495,246.83|569,825,744.19|590,534,283.44|
|Total|5,914,345,955.43|4,443,120,274.56|4,074,944,500.64|3,012,031,852.16|

top 5 clients:
Unit: yuan
||||
|-|-|-|
|Name of customers|Main business income|Proportion to the wholeoperational turnover of the|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
||||
|-|-|-|
|||company (%)|
|Hefei Midea Washing Machine Co., Ltd|778,735,700.93|12.28|
|Suning Procurement Centre of SuningCommerce Group Co., Ltd|649,422,743.43|10.24|
|Midea (Singapore) Trading Co., Ltd.|332,293,174.91|5.24|
|Guizhou Midea Refrigeration ProductionSales Co., Ltd.|104,352,697.28|1.64|
|Beijing Jingdong Century CommerceCo., Ltd|87,651,950.68|1.38|
|Total|1,952,456,267.23|30.78|

 etails of investment income
Unit: yuan
||||
|-|-|-|
|Items|Occurred this year|Occurred last year|
|Long-term equity investment gains oncost basis –cash dividends fromnon-subsidiaries|173,405.12|341,810.24|
|Long-term equity investment gains on equitybasis|-116,701.92|-143,000.95|
|Gains from disposal of long-term equityinvestment|5,782,319.61|—|
|Investment gains from holding of tradingfinancial assets, etc.|11,916,730.00|4,313,120.00|
|Investment gains from holding of bankfinancial products|58,446,235.40|37,566,106.13|
|Total|76,201,988.21|42,078,035.42|

 i ty investment gains on cost basis
Unit: yuan
||||
|-|-|-|
|Name of Investee|Occurred this year|Occurred last year|
|Hengtai Insurance Brokers Co., Ltd.||55,000.00|
|Suzhou People's Shopping Centre|50,000.00|40,000.00|
|Bank of Jiangsu|123,405.12|246,810.24|
|Total|173,405.12|341,810.24|

 rm equity investment gains on equity basis
Unit: yuan
||||
|-|-|-|
|Name of Investee|Occurred this year|Occurred last year|
|Guangzhou Antaida MaterialDistribution Co. , Ltd.|-116,701.92|-143,000.95|
|Total|-116,701.92|-143,000.95|

 6.Appendix of Cash Flow Statement
||||
|-|-|-|
|Items|Current year|Last year|
|1.Net profit adjusted to cash flow of operation:|--|--|
|Net profit|203,411,195.64|211,833,366.51|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
||||
|-|-|-|
|Plus: Asset impairment provision|96,662,671.60|78,550,923.12|
|Fixed asset depreciation, gas and petroldepreciation, production goods depreciation|54,331,764.50|49,818,195.32|
|Amortizing of intangible assets|2,710,201.61|2,801,855.63|
|Amortizing of long-term expenses|21,778,393.30|28,220,247.32|
|Loss from disposal of fixed assets, intangibleassets, and other long-term assets (“-“ for gains)|-33,182.42|-7,195,752.01|
|Loss from fixed asset discard|||
|Loss from fluctuation of fair value|-7,723,870.00|1,664,430.00|
|Financial expenses|||
|Investment loss (“-“ for gains)|-76,201,988.21|-42,078,035.42|
|Decrease of deferred income tax asset (“-“ forincrease)|-54,159,450.98|-3,882,174.38|
|Increase of deferred income tax liabilities (“-“ fordecrease)|1,158,580.50|-249,311.70|
|Decrease of inventory (“-“ for increase)|36,444,483.47|-150,498,562.28|
|Decrease of operational receivable items (“-“ forincrease)|-4,045,873,381.58|786,484,163.66|
|Increase of operational payable items (“-“ fordecrease)|4,382,121,951.87|-1,018,496,681.82|
|Others||33,250,000.00|
|Net cash flow generated by business operation|614,627,369.30|-29,777,336.05|
|2. Investment and financing activities not involving incash flow|--|--|
|Liabilities converted to capital|||
|Convertible bond expire within 1 year|||
|Fixed assets acquired under finance leases|||
|3. Change of cash and cash equivalents|--|--|
|Balance of cash at end of year|882,413,120.18|848,257,647.96|
|Less: Balance of cash at beginning of year|848,257,647.96|1,472,529,354.18|
|Plus: Balance of cash equivalents at end of term|||
|Less: Balance of cash equivalents at beginningof term|||
|Net increase of cash and cash equivalents|34,155,472.22|-624,271,706.22|

 NoteXV：
Further Information
1. Details of non-recurring gain/loss of current period
Unit: yuan
||||
|-|-|-|
|Item|Amount in current period|Notes|
|Gain/loss from disposal of non-current assets|-1,078,789.83||

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
||||
|-|-|-|
|Government Grant into Current Profit and Loss(except for those government Grant closely relatedto the Company’s business, and received at nationalstatutory standard and amount)|23,748,858.49||
|Gain/loss from debt reconstruction|2,807,241.09||
|Impairment Loss for Account Receivable testedindividually ready for reversal|733,146.16|—|
|Effect of On-off Adjustment to current profit andloss according to taxation law and accountingregulations|308,469.59|—|
|Other non-operating income and losses other thanitems above|9,283,944.96||
|Other Profit and loss qualified for non-recurringprofit and loss|97,565,087.41||
|Dismiss welfare|-5,944,610.29||
|Total|127,423,347.58||
|Less: Income Tax Effect|9,485,975.81||
|Less: Minority interest (after-tax)|14,848,388.66||
|Total|103,088,983.11||

2. ROE (Return on Equity) and EPS (Earning Per Share)
Unit：yuan
|||||
|-|-|-|-|
|Profit of the reporting period|Weighted Average ROE(Return onShareholder’s Equity)|EPS||
|||Basic EPS|Diluted EPS|
|Net profit attributable to ordinaryshareholders of the Company|10.88%|0.65|0.65|
|Net profit attributable to ordinaryshareholders of the Company afterdeducting Non-recurring profit and loss|8.17%|0.49|0.49|

3. Illustrations of Change in Items of Financial Statement of the Company
Unit: (RMB0’000)
|||||||
|-|-|-|-|-|-|
|Items|Amount incurrentperiod|Amount inlast period|Increase/decrease|Variation%|Reason|
|Financial AssetsHeld for trading|1,501.67|122.46|1,379.22|1126.27|Forward foreign exchangecontract with Bankincreased|
|Accountsprepayment|14,084.19|9,718.84|4,365.35|44.92|Output increasing led toincreasing in materialprocurement|
|Other AccountsReceivable|2,616.35|1,698.45|917.90|54.04|Payment on Account ofefficient beneficial energyplan|
|Other Non-currentAssets|179,128.85|120,117.18|59,011.67|49.13|Financial product in Bankunexpired increased bythe end of the period|
|InvestmentProperty|946.68|504.95|441.73|87.48|Idle plant from oldfactory designated forrent.|
|Intangible Asset|21,944.55|30,871.41|-8,926.86|-28.92|Investment project in|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
|||||||
|-|-|-|-|-|-|
||||||Tianjin Industrial Parkhas apportioned and landtransferred returned back.|
|Long-termDeferred expenses|714.78|2,772.99|-2,058.21|-74.22|Mould Amortization|
|Deferred tax Asset|17,099.10|10,030.89|7,068.21|70.46|Deductible temporarydifference have increased.|
|Note Payable|38,567.31|100,309.07|-61,741.76|-61.55|Bank’s Acceptance billshave matured|
|Accounts Payable|276,804.61|212,997.96|63,806.65|29.96|Procurement increase dueto increase in sales andproduction.|
|Advance Fromcustomers|105,795.26|80,444.16|25,351.10|31.51|Increase is caused byDomestic Marketexpansion.|
|Payroll Payable|20,732.36|12,590.27|8,142.10|64.67|Performance Salary ispaid on semester basisrather than quarter basisof last year, the payrollpayable accrued istherefore increased.|
|Tax Payable|19,920.39|-382.10|20,302.49|5313.33|Tax payable increased dueto increase in sales.|
|Other AccountsPayable|5,002.11|7,172.64|-2,170.53|-30.26|Operational temporarycredits decreased.|
|Special Accountspayable|207.40|260.74|-53.35|-20.46|Use of Special Capitalhas been increased.|
|Deferred taxliability|228.44|21.17|207.27|979.14|Fair value change offinancial asset held fortrading have increased.|
|Other non-currentliabilities|56.86|127.18|-70.32|-55.29|Deferred income has beenrecognized during thisperiod.|
|Exchange lossfrom translation ofstatement inforeign currency|-355.97|-262.11|-93.86|-35.81|Translation difference ofstatement of Singaporesubsidiary.|
|Operating Income|872,795.60|689,986.39|182,809.21|26.49|Sales have increased.|
|Operating cost|654,962.19|533,991.46|120,970.74|22.65|Increase is along withSales increase.|
|Business tax andsurcharge|5,300.26|3,048.18|2,252.08|73.88|Turnover tax increased assales increase.|
|Selling expenses|126,711.84|84,056.05|42,655.79|50.75|Selling expenses increasedue to changes inmarketing pattern andincrease in sales volume.|
|Financial Expenses|2,460.97|-305.24|2,766.21|906.25|Exchange loss due toexchange rate changes.|
|Asset Impairmentloss|4,933.39|867.14|4,066.26|468.93|Provision for inventoryimpairment and accountsreceivable have increased.|
|Gain from Fairvalue changes|1,379.22|-306.77|1,685.99|549.59|Gain from fair valuechange in forward foreignexchange contract|
|Investment income|11,686.19|5,562.27|6,123.92|110.10|Income from financialproduct in Bank Increased|

Notes to the Financial Statements Wuxi Little Swan Company Ltd. Year 2012
|||||||
|-|-|-|-|-|-|
|Non-operatingincome|4,037.49|5,200.40|-1,162.91|-22.36|Gain from disposal ofasset decreased.|
|Non-operating cost|1,319.59|1,088.85|230.73|21.19|Local Charges Increasedue to sales increased.|
|Minority interest|6,140.76|4,044.85|2,095.91|51.82|Profit of holdingsubsidiary increasedcompared to last year|
|OtherComprehensiveIncome|-91.66|-7.46|-84.20|-1129.17|Change arisen fromInfluenced by fluctuationof exchange rate appliedto statement of Singaporesubsidiary|