China Fangda Group Co., Ltd. 2014 Annual Report China Fangda Group Co., Ltd.
2014 Annual Report
March 2015
China Fangda Group Co., Ltd. 2014 Annual Report I. Important Statement, Table of Contents and Definitions
The members of the Board and the Company guarantee that the announcement is free from any false information, misleading statement or material omission and are jointly and severally liable for theinformation‟s truthfulness, accuracy and integrity.
All the Directors have attended the meeting of the board meeting at which this report was examined.
The Board meeting reviewed and approved the profit distribution preplan: distributing cash dividend of RMB0.3 for each ten shares to all shareholders on the basis of all shares of the Company on December 31, 2014 and no dividend share is issued to shareholders. No reserve is capitalized.
Mr. Xiong Jianming, the Chairman of Board, Mr. Lin Kebin, the Chief Financial Officer, and Mr. Chen Yonggang, the manager of accounting department declare: the Financial Report carried in this report is authentic and completed.
China Fangda Group Co., Ltd. 2014 Annual Report Table of Contents
I. Important Statement, Table of Contents and Definitions .................................... 2 II. Company Profile ..................................................................................................... 7 III Financial Highlight .............................................................................................. 10 IV Board ofDirectors‟ Report .................................................................................. 13 V Significant Events .................................................................................................. 37 VI Changes in Share Capital and Shareholders ..................................................... 42 VII Particulars about the Directors, Supervisors, Senior Management and Employees ................................................................................................................... 48 VIII Corporation Governance ................................................................................. 56 IX Internal Control ................................................................................................... 61 X Financial Statements ............................................................................................. 63 XI Documents for Reference .................................................................................. 171
China Fangda Group Co., Ltd. 2014 Annual Report Definitions
||||
|-|-|-|
||Refers||
|Terms||Description|
||to||
||Refers||
|Fangda Group, company, the Company||China Fangda Group Co., Ltd.|
||to||
||Refers||
|Articles of Association||Articles of Association of China Fangda Group Co., Ltd.|
||to||
||Refers||
|Meeting of shareholders||Meetings of shareholders of China Fangda Group Co., Ltd.|
||to||
||Refers||
|Board of Directors||Board of Directors of China Fangda Group Co., Ltd.|
||to||
||Refers||
|Supervisory Committee||Supervisory Committee of China Fangda Group Co., Ltd.|
||to||
||Refers||
|Banglin Co.||Shenzhen Banglin Technologies Development Co., Ltd.|
||to||
||Refers||
|Shilihe Co.||Shenzhen Shilihe Investment Co., Ltd.|
||to||
||Refers||
|Shengjiu Co.||Shengjiu Investment Ltd.|
||to||
||Refers|Formerly Shenzhen Fangda Decoration Engineering Co., Ltd., now|
|Fangda Jianke, Fangda Decoration|||
||to|known as Shenzhen Fangda Jianke Group Co., Ltd.|
||Refers||
|Fangda Automatic||Shenzhen Fangda Automation System Co., Ltd.|
||to||
||Refers||
|Fangda New Material||Fangda New Materials (Jiangxi) Co., Ltd.|
||to||
||Refers||
|Fangda New Resource||Shenzhen Fangda New Energy Co., Ltd.|
||to||
||Refers||
|Fang SOZN||Guangdong Fangda SOZN Lighting Co., Ltd.|
||to||
||Refers||
|Shenyang Fangda||Shenyang Fangda Semi-conductor Lighting Co., Ltd.|
||to||
||Refers||
|Shenzhen Woke||Shenzhen Woke Semi-conductor Lighting Co., Ltd.|
||to||
|Hong Kong Junjia|Refers|Hong Kong Junjia Group Co., Ltd.|

China Fangda Group Co., Ltd. 2014 Annual Report
||||
|-|-|-|
||to||
||Refers||
|Fangda Aluminium||Jiangxi Fangda New Type Aluminum Co., Ltd.|
||to||
||Refers||
|Fangda Yide Co.||Shenzhen Fangda Yide New Material Co., Ltd.|
||to||
||Refers||
|Dongguan Fangda New Material||Dongguan Fangda New Material Co., Ltd.|
||to||
||Refers||
|Kexunda Co.||Shenzhen Kexunda Software Co., Ltd.|
||to||
||Refers||
|Fangda Property||Shenzhen Fangda Property Development Co., Ltd.|
||to||
||Refers|Formerly Chengdu Fangda New Material Co., Ltd., now known as|
|Chengdu Fangda New Material|||
||to|Chengdu Fangda Construction Technology Co., Ltd.|
||Refers||
|Shenyang Decoration||Fangda Decoration Engineering (Shenyang) Co., Ltd.|
||to||
||Refers||
|CSRC||China Securities Regulatory Commission|
||to||
||Refers||
|SZSE||Shenzhen Stock Exchange|
||to||
||Refers||
|Sponsor, Zhongshan Securities||Zhongshan Securities Co., Ltd.|
||to||

China Fangda Group Co., Ltd. 2014 Annual Report Major Risk Statement
The Company has specified market, management and production and operation risks in this report. Please review the potential risks and measures mentioned in the discussion and analysis of future development in IV. Board ofDirectors‟ Report.
China Fangda Group Co., Ltd. 2014 Annual Report II. Company Profile
1. Company profiles
|||||
|-|-|-|-|
|Stock ID|Fangda Group, Fangda B|Stock code|000055、200055|
|Modified stock ID (if any)|None|||
|Stock Exchange|Shenzhen Stock Exchange|||
|Chinese name|China Fangda Group Co., Ltd.|||
|Chinese abbreviation|Fangda Group|||
|English name (if any)|CHINA FANGDA GROUP CO., LTD.|||
|English abbreviation (if any)|CFGC|||
|Legal representative|Xiong Jianming|||
|Registered address|Fangda Building, Kejinan 12th Avenue, High-tech Zone, Shenzhen, PR China.|||
|Zip code|518057|||
|Office address|20F, Fangda Building, Kejinan 12th Avenue, High-tech Zone, Shenzhen, PR China.|||
|Zip code|518057|||
|Website|http://www.fangda.com|||
|Email|fd@fangda.com|||

2. Contacts and liaisons
||||
|-|-|-|
||Secretary of the Board|Representative of Stock Affairs|
|Name|Zhou Zhigang|Guo Linchen|
||20F, Fangda Building, Kejinan 12th|20F, Fangda Building, Kejinan 12th|
|Address|||
||Avenue, Hi-Tech Zone, Shenzhen|Avenue, Hi-Tech Zone, Shenzhen|
|Tel.|86(755) 26788571 ext. 6622|86(755) 26788571 ext. 6622|
|Fax|86(755)26788353|86(755)26788353|
|Email|zqb@fangda.com|zqb@fangda.com|

3. Information disclosure and inquiring
|||
|-|-|
|Information disclosure and inquiring Press medias|China Securities Journal, Security Times, Shanghai Securities Daily, Hong|
|of information disclosure|Kong Commercial Daily|
|Website assigned by CSRC to release the online||
||http://www.cninfo.com.cn|
|reports||

China Fangda Group Co., Ltd. 2014 Annual Report
|||
|-|-|
|Place for information inquiry|Secretarial Office of the Board|

4. Registration changes
|||||||
|-|-|-|-|-|-|
||||Business license|Tax registration||
||Registration date|Registration place|||Organization code|
||||number|number||
|||Shenzhen Bureau of||||
|||Industry &||||
|First registration|December 13, 1995||440301501124785|440301192448589|19244858-9|
|||Commerce||||
|||Administration||||
|||Market Supervision||||
|Registration at the||||||
|||Administration of||||
|end of the reporting|June 20, 2013||440301501124785|440301192448589|19244858-9|
|||Shenzhen||||
|period||||||
|||Municipality||||
|Changes in main businesses since the||||||
|||None||||
|listing of the Company||||||
|||In 1996, the Company listed it’s A and B shares and the controlling shareholder is||||
|||Shenzhen Fangda Group Co., Ltd. On August 25, 2000, the controlling shareholder||||
|Changes in the controlling shareholders (if||changed its name into Shenzhen Fangda Economic Development Co., Ltd. On July 5,||||
|any)||2002, the controlling shareholder changed into Shenzhen Banglin Technologies||||
|||Development Co., Ltd. By the end of this reporting period, the controlling||||
|||shareholder remains the Shenzhen Banglin Technologies Development Co., Ltd..||||

 5. Other information
Public accountants employed by the Company
|||
|-|-|
|Public accountants|Grant Thornton (special general partner)|
|Address|5th Floor, Scitech Place, 22 Jianguomen Wai Avenue, Chaoyang District, Beijing, China|
|Signing accountant names|Lin Kaiqin and Li Chunmei|

Sponsor engaged by the Company to perform continued supervision and guide during the reporting period
√ Applicable□ Inapplicable
|||||
|-|-|-|-|
|Sponsor name|Office address|Representatives|Period of supervision and guide|
||||The period started on July 15, 2010 and|
||||ended on November 7, 2012. The|
||||sponsor has submitted the sponsor report|
||29th Floor, New World Center,|||
||||to CSRC. Given that the fund raised|
|Zhongshan Securities Co., Ltd.|6009 Yitian Road, Futian|He Lihui, Cui Lei||
||||from non-public issue of the Company in|
||District, Shenzhen|||
||||2010 has not been fully used, the sponsor|
||||will continue to perform supervision and|
||||guide for the use of the fund.|

Financial advisor engaged by the Company to perform continued supervision and guide during the reporting period
China Fangda Group Co., Ltd. 2014 Annual Report□ Applicable√ Inapplicable
China Fangda Group Co., Ltd. 2014 Annual Report III Financial Highlight
1. Financial Highlight
The Company retroactively adjusts or restates financial statistics of the previous years because of changes in account policies and correction of accounting errors.
□ Yes√ No
||||||
|-|-|-|-|-|
||2014|2013|Increase/decrease|2012|
|Turnover (yuan)|1,938,324,435.51|1,747,620,845.74|10.91%|1,397,901,424.59|
|Net profit attributable to|96,998,429.76|85,676,863.78|||
|shareholders of the listed company|||13.21%|24,948,377.20|
|(yuan)|||||
|Net profit attributable to the|||||
|shareholders of the listed company|||||
||69,068,577.10|68,393,391.56|0.99%|7,361,274.38|
|and after deducting of|||||
|non-recurring gain/loss (RMB)|||||
|Net cash flow generated by|-557,893,929.44|156,544,620.31|||
||||-456.38%|59,262,071.37|
|business operation (RMB)|||||
|Basic earnings per share|0.13|0.11|||
||||18.18%|0.03|
|(yuan/share)|||||
|Diluted Earnings per share|0.13|0.11|||
||||18.18%|0.03|
|(yuan/share)|||||
|Weighted average net income/asset|||||
||8.14%|7.61%|0.53%|2.30%|
|ratio|||||
||End of 2014|End of 2013|Increase/decrease|End of 2012|
|Total asset (RMB)|3,662,719,900.41|2,599,557,542.57|40.90%|2,327,802,889.51|
|Net profit attributable to the|1,234,930,863.46|1,160,639,730.85|||
|shareholders of the listed company|||6.40%|1,098,612,195.57|
|(RMB)|||||

2. Differences in accounting data under domestic and foreign accounting standards
1. Differences in net profits and assets in financial statements disclosed according to the international and Chinese account standards
√ Applicable□ Inapplicable
In RMB
|||
|-|-|
|Net profit attributable to the shareholders of the|Net profit attributable to the shareholders of the|

China Fangda Group Co., Ltd. 2014 Annual Report
||||||
|-|-|-|-|-|
||listed company||listed company||
||This period|Last period|Closing amount|Opening amount|
|On Chinese accounting|96,998,429.76|85,676,863.78|1,234,930,863.46|1,160,639,730.85|
|standards|||||
|Items and amounts adjusted according International Accounting Standards|||||
|On international accounting|96,998,429.76|85,676,863.78|1,239,694,261.70|1,165,403,129.09|
|standards|||||

2. Differences in net profits and assets in financial statements disclosed according to the overseas and Chinese account standards
□ Applicable√ Inapplicable
2. There is no difference in net profits and assets in financial statements disclosed according to the international and Chinese account standards during the report period.
3. Explanation of the differences in accounting data under domestic and foreign accounting standards√ Applicable□ Inapplicable
Net assets attributable to the listedcompany’s shareholders calculated according to the IAS is RMB4,763,398.24 higher than that calculated according to the domestic accounting standards, mainly attributable to the
capitalization of borrow expenses before the domestic Enterprise Accounting Standard was implemented on January 1, 2007.
3. Accidental gain/loss item and amount
√ Applicable□ Inapplicable
In RMB
||||||
|-|-|-|-|-|
|Items|2014|2013|2012|Notes|
|Non-current asset disposal gain/loss|-24,398.43||||
|(including the write-off part for which assets||-462,554.08|260,038.90||
|impairment provision is made)|||||
|Subsidies accounted into the current income|2,340,175.75||||
|account (except the government subsidy|||||
|closely related to the enterprise’s business||1,815,855.07|6,275,756.00||
|and based on unified national standard|||||
|quota)|||||
|Capital using expense charged to|3,649,313.12||||
|non-financial enterprises and accounted into||2,149,420.09|1,180,032.08||
|the current income account|||||
|Gain from entrusted investment or assets|2,144,844.80||||
|||306,301.37|||
|management|||||

China Fangda Group Co., Ltd. 2014 Annual Report
||||||
|-|-|-|-|-|
|Gain/loss from change of fair value of|-2,852,885.00||||
|transactional financial asset and liabilities,|||||
|and investment gains from disposal of|||||
|transactional financial assets and liabilities|||3,448,207.99||
|and sellable financial assets, other than valid|||||
|period value instruments related to the|||||
|Company’s common businesses|||||
|Gain/loss from change of fair value of|34,897,632.10||||
|investment property measured at fair value||16,647,859.74|12,290,834.22||
|in follow-up measurement|||||
|Other non-business income and expenditures|-3,671,724.03||||
|||1,929,934.59|917,890.35||
|other than the above|||||
|Less: Influenced amount of income tax|9,526,862.57|5,177,842.87|5,353,185.48||
|Influenced amount of minority|-973,756.92||||
|||-74,498.31|1,432,471.24||
|shareholders’ equity (after-tax)|||||
|Total|27,929,852.66|17,283,472.22|17,587,102.82|--|

Explanation statement should be made for accidental gain/loss items defined and accidental gain/loss items defined as regular gain/loss items according to the Explanation Announcement of Information Disclosure No. 1 - Non-recurring gain/loss mentioned.
□ Applicable√ Inapplicable
No accidental gain/loss defined as recurrent gain/loss as defined in Explanation Announcement of Information Disclosure No. 2
China Fangda Group Co., Ltd. 2014 Annual Report IV Board ofDirectors‟ Report
1. Summary
In 2014, the growth of the Chinese economy continued slowing down, subdued by weak government investment in fixed assets. Economic risks resurfaced, creating numerous difficulties for enterprises. To survive the weak economy and increasingly fierce competition, the Company has continued improving the brand equity, expertise and services, stabilizing the growth. In the report period, the Company recorded a sales income of RMB1,938,324,400, up10.91% year on year. The net profit attributed to owners of the parent reached RMB96,998,400, up13.21% year on year. The revenue from main businesses continued growing. In 2014, the Company had secured new orders worth RMB2.816 billion with undelivered orders worth RMB3.268 billion, which172.04%, paving the way for the Company to complete the sales target for 2015. While developing existing businesses, the Company has increased investment in new energy sector in the report period and focused on solar power plants and LED lights as a development area.
1、 Curtain wall and material industry development trend
Currently, the curtain wall system and material sector remains theCompany’s main source of sales revenue and profit. The Company has further consolidated its brand advantages and visibility, making remarkable progress in key sales regions. In the report period, the Company has won bids in a series of notable energy-saving and green curtain wall and material projects. The curtain wall system used in Shenyu Shangcheng South project, China Energy Storage Building, and Chongqing Tianhe Global Center is 300m high. The Company has sought to expand the business size, improve field management, optimize design and engineering solutions, elevate production and engineering efficiency, lower costs, consolidate profitability to boost theCompany’s long-term development.
The Company has adhered to the business philosophy of integrity, trust, cooperation and continuous improvement and seeks to meetcustomers’ needs thanks to our customer-centered value, strong innovation and high engineering quality, receiving wide recognition among customers. The Company won the title of Outstanding Supplier in the report period.
2. New energy business
The Company established a new energy company to develop solar PV applications, PV construction and LED industry. In the report period, the Company has entered into solar energy power plant construction agreements of 900MWp in Jiangxi Pingxiang, Xinjian and Longnan and obtained government approval for solar energy power plant construction of 100MWp. On December 23, 2014, the Board of Directors approved the proposal of private A-share issuing. No more than 105 million shares (inclusive) will be issued to raise no more than RMB1.008 billion. The fund will be used to support construction solar power plants and repay bank loans. The private share issuing is now undergoing. Solar power generation business is a strategic business of the Company and coincides with the national policy. The business enjoys a bright development lookout and will fuel theCompany’s long-term development.
In the report period, the Company acquired Fangda SOZN, which is specialized in LED lights. After the acquisition, management teams are established to explore traditional channels and first- and second-tier markets in China. The innovative direct sales mode is introduced and is high received among local customers and consumers. Four modern production bases with new and outstanding equipment are set up, including more than 20 automatic
China Fangda Group Co., Ltd. 2014 Annual Report assembly lines and intelligentR&D and production devices. Fangda SOZN can produce more than 10 million LED bulbs now with more than 100 patented technologies, more than 10,000 sales networks. The Company continued to promote the online and office sales mode in order or tap on the advantages of e-business and traditional sales channels, making Fangda SOZN the domestic leading LED bulb producer.
3. Metro screen door business
In the report period, several screen door orders entered design, production and engineering stage. Screen doors for Shenzhen metro phase III line No.9 and 11,Xi’an metro line No.3, Wuhan metro phase II line No.4, Nanchang metro line No.1, Fuzhou metro line No.1, Wuhan-Xiaogan railway, Singapore Dashi extension line have been designed, produced and installed as scheduled. The screen door business's sales revenue increased64.55% from the last year. During the report period, thanks to high reliability and stability, theCompany’s screen door systems made the record the zero failure in the one-million attempt service life test of the Singapore Tuas expansion line and Nanchang No.1 line. The two projects have completed the one-million attempt service life test and acceptance procedure and have been put into massive product.
The metro screen door maintenance business is high added-value service sector. As many screen doors enter the maintenance cycle, the business enjoys a bright outlook. The Company has a natural advantage in this high-end service industry. Our screen door system are independently developed by us, thus enabling us to provide prompt, overall, effective and standard maintenance services for our customers without other third parties. In the report period, the Company received maintenance orders in Tianjin, Nanjing and Shenzhen, showing theCompany’s leadership in the sector. The business will expand theCompany’s rail transport industry line.
4. Fangda Town renovation
In the report period, Fangda Town renovation project has obtained construction permits. Since commencement in 2014, various works have been performed as scheduled. The sales will start in the
4th
quarter in 2015. To reach the sales target, the Company has launched promotion, business introduction, media development and advertising in the report period.
5. Introducing talents and build the corporate culture
As orders increase rapidly over the past few year and five industry bases are put into operation, the Company has further improved the management matrix, optimize the business process, aggressively introduced high-quality and diligent management and technical professional to build a modern management led by engineers, technicians, comprehensive management executives and technical sales representatives. The Company attaches great importance to corporate culture and construction of a harmonious working environment. Various activities such as health care lectures, speech competition, sports competitions are held for the staff, including birthday parties and speed dating for single employees to refresh employees and get them ready for elevating theCompany’s core competitiveness.
6. Awards
In the report period, Fangda is selected by the national industry and commerce administration as a Chinese well-known trademark and the Company is selected as one of the most promising listing company by Sina. Fangda also won the title a Shenzhen well-known brand for 12 consecutive years.
Thanks to outstanding quality and brand equity, the Company has won a series of remarkable titles including the 1994-2014 outstanding enterprise for sustained development, National Construction Engineering Award, High-quality Construction Award, Guangdong Engineering Golden Award, Guangdong Construction Engineering Quality Award, Shenzhen Golden Bull Engineering Award, National Construction Decoration Award, anmd QCC silver and outstanding performance awards. Mr. Wei Yuexing, general manager of Fangda Jianke is given the title as one of the Shenzhen 100 industry leaders in the curtain wall industry.
China Fangda Group Co., Ltd. 2014 Annual Report Fangda Automatic is given titles as theXi’an metro construction outstanding supplier, advanced equipment supplier, outstanding maintenance provider, Nanjing metro construction outstanding supplier, Dongguan railway line R2 outstanding supplier, Wuhan metro line No.4 phase II outstanding supplier.
Jiangxi New Material was given the title as an outstanding company in the Nanchang Hi-tech Park, class-A taxpayer.
2. Main business analysis
1. Summary
Implementation progress of development strategies and operating plans disclosed previously in the report period In 2014, the growth of the Chinese economy continued slowing down, subdued by weak government investment in fixed assets. Economic risks resurfaced, creating numerous difficulties for enterprises. To survive the weak economy and increasingly fierce competition, the Company has continued improving the brand equity, expertise and services, stabilizing the growth. In the report period, the Company recorded a sales income of RMB1,938,324,400, up10.91% year on year. The net profit attributed to owners of the parent reached
RMB96,998,400, up13.21% year on year. The revenue from main businesses continued growing. In 2014, the Company had secured new orders worth RMB2.816 billion with undelivered orders worth RMB3.268 billion, which172.04%, paving the way for the Company to complete the sales target for 2015. While developing existing businesses, the Company has increased investment in new energy sector in the report period and focused on solar power plants and LED lights as a development area.
The actual operating performance is over20% lower or higher than the annual forecast result disclosed earlier.□ Applicable√ Inapplicable
Change in the main business mode
□ Applicable√ Inapplicable
2. Revenue
The physical sales revenue is high the labor service revenue
√ Yes□ No
|||||||
|-|-|-|-|-|-|
|Industry|Items|Unit|2014|2013|YOY change (% )|
||Sales|M2|2,479,915.61|2,472,558.74|0.30%|
|Curtain wall system||||||
||Output|M2|2,593,192.46|2,403,890.85|7.87%|
|and materials||||||
||Inventory|M2|220,123.14|106,846.3|106.02%|

 Explanation for a year-on-year change of over30%
□ Applicable√ Inapplicable
Major orders on hand
√ Applicable□ Inapplicable
In the report period, the Company received orders worth RMB2.816 billion, of which22.43% has realized output
value. By December 31, 2014, the order reserve amounted to RMB3.268 billion. All the orders have been fulfilled
as contracted.
China Fangda Group Co., Ltd. 2014 Annual Report Major changes or adjustment of products or services in the report period
√ Applicable□ Inapplicable
Fang SOZN was acquired in the repot period to add LED bulb into theCompany’s product scope, creating a new profit growth point.
Main customers
|||
|-|-|
|Total sales amount to top 5 customers (RMB)|379,625,604.60|
|Proportion of sales to top 5 customers in the annual sales|19.59%|

 Information of the Company's top 5 customers
□ Applicable√ Inapplicable
Other information about main customers
□ Applicable√ Inapplicable
3. Costs
Industry
In RMB
||||||||
|-|-|-|-|-|-|-|
|||2014||2013|||
|Industry|Items||Proportion in||Proportion in|YOY change (% )|
|||Amount||Amount|||
||||operating costs||operating costs||
|Metal production|Raw materials|929,436,079.36|67.40%|874,994,717.90|65.38%|6.22%|
|Metal production|Labor|94,243,308.97|6.83%|76,722,963.79|5.73%|22.84%|
||Installation and||||||
|Metal production||299,337,209.27|21.71%|327,693,011.67|24.48%|-8.65%|
||onsite expenses||||||
|Metal production|Others|55,895,771.82|4.05%|59,002,837.42|4.41%|-5.27%|
|Metal production|Total|1,378,912,369.42|100.00%|1,338,413,530.78|100.00%|3.03%|

 Product
In RMB
||||||||
|-|-|-|-|-|-|-|
|||2014||2013|||
|Product|Items||Proportion in||Proportion in|YOY change (% )|
|||Amount||Amount|||
||||operating costs||operating costs||
|Curtain wall|||||||
|system and|Raw materials|929,436,079.36|67.40%|874,994,717.90|65.38%|6.22%|
|materials|||||||
|Curtain wall|||||||
|system and|Labor|94,243,308.97|6.83%|76,722,963.79|5.73%|22.84%|
|materials|||||||
|Curtain wall|||||||
||Installation and||||||
|system and||299,337,209.27|21.71%|327,693,011.67|24.48%|-8.65%|
||onsite expenses||||||
|materials|||||||

China Fangda Group Co., Ltd. 2014 Annual Report
||||||||
|-|-|-|-|-|-|-|
|Curtain wall|||||||
|system and|Others|55,895,771.82|4.05%|59,002,837.42|4.41%|-5.27%|
|materials|||||||
|Curtain wall|||||||
|system and|Total|1,378,912,369.42|100.00%|1,338,413,530.78|100.00%|3.03%|
|materials|||||||

Main suppliers
|||
|-|-|
|Purchase amount of top 5 suppliers (RMB)|431,310,596.92|
|Proportion of purchase amount of top 5 suppliers in the||
||26.44%|
|total annual purchase amount||

Information of theCompany’s top 5 suppliers
□ Applicable√ Inapplicable
Other information about main suppliers
□ Applicable√ Inapplicable
4. Expenses
None
5.R&D expenses
In the report period, Fangda Group has developed a series of new products and technology in low-carbon, energy saving, environmental protection fields, including energy-saving and green curtain wall, solar power curtain wall, aluminium-plastic composite panel, single-layer aluminium panel, honeycomb aluminum panel, metro screen door system, LED lights, PV power plants. All theR&D projects have been reviewed and approved by theGroup’s technology committee. The products and technologies have independent intellectual property rights and patents, which will give a strong booth to theCompany’s long-term growth.
In the report period, theR&D expense totaled RMB86,772,900, accounting4.48% of the operating revenue in 2014. It accounts for7.02% of the interest attributed to owners of the parent on December 31, 2014
5. Cash flow
In RMB
|||||
|-|-|-|-|
|Items|2014|2013|YOY change (% )|
|Sub-total of cash inflow from|1,684,047,696.92|1,806,435,338.47||
||||-6.78%|
|business operations||||
|Sub-total of cash outflow from|2,241,941,626.36|1,649,890,718.16||
||||35.88%|
|business operations||||
|Cash flow generated by|-557,893,929.44|156,544,620.31||
||||-456.38%|
|business operations, net||||

China Fangda Group Co., Ltd. 2014 Annual Report
|||||
|-|-|-|-|
|Sub-total of cash inflow|302,123,140.16|120,915,060.37||
||||149.86%|
|generated from investment||||
|Subtotal of cash outflows|588,172,728.21|172,570,887.63|240.83%|
|Cash flow generated by|-286,049,588.05|-51,655,827.26||
||||453.76%|
|investment activities, net||||
|Subtotal of cash inflow from|1,303,817,100.01|529,000,000.00||
||||146.47%|
|financing activities||||
|Subtotal of cash outflow from|642,732,507.84|588,354,192.64||
||||9.24%|
|financing activities||||
|Net cash flow generated by|661,084,592.17|-59,354,192.64||
||||-1,213.80%|
|financing activities||||
|Net increase in cash and cash|-182,599,023.19|45,069,882.52||
||||-505.15%|
|equivalents||||

Explanation for a year-on-year change of over30%
Explanation of major difference between the cash flow generated by operating activities and the net profit in the year.
3. Business composition
In RMB
||||||||
|-|-|-|-|-|-|-|
|||||Year-on-year|Year-on-year|Year-on-year|
||Turnover|Operation cost|Gross margin|change in|change in|change in gross|
|||||operating revenue|operating costs|margin|
|Industry|||||||
|Metal production|1,643,589,644.97|1,378,912,369.42|16.10%|2.71%|3.03%|-0.26%|
|Product|||||||
|Curtain wall|||||||
|system and|1,643,589,644.97|1,378,912,369.42|16.10%|2.71%|3.03%|-0.26%|
|materials|||||||
|District|||||||
|Domestic|1,856,320,639.39|1,546,696,308.96|16.68%|11.62%|11.23%|0.29%|
|Overseas|40,212,936.07|26,435,336.21|34.26%|16.27%|18.74%|-1.37%|

 Main business statistics adjusted in the recent one year with the statistics criteria adjusted in the report period□ Applicable√ Inapplicable
IV. Assets and Liabilities
1. Major changes in assets
In RMB
China Fangda Group Co., Ltd. 2014 Annual Report
||||||||
|-|-|-|-|-|-|-|
||End of 2014||End of 2013||||
|||Proportion in||Proportion in|Change|Notes|
||Amount||Amount||||
|||total assets||total assets|||
||212,430,798.87||333,876,921.97||||
|Monetary capital||5.80%||12.84%|-7.04%||
|Account|1,105,242,251.46||898,780,981.93||||
|||30.18%||34.57%|-4.39%||
|receivable|||||||
||982,441,187.05||428,537,851.82|||The inventory book value balance|
|||||||at the end of the period increased|
|||||||128.03% from the beginning. It is|
|Inventory||26.82%||16.49%|10.33%||
|||||||because that the development cost of|
|||||||Fangda Town renovation project|
|||||||increased.|
|Investment real|226,279,523.39||195,249,069.13||||
|||6.18%||7.51%|-1.33%||
|estate|||||||
|Long-term share|11,048,660.43||9,994,565.55||||
|||0.30%||0.38%|-0.08%||
|equity investment|||||||
||489,714,684.63||462,930,269.98||||
|Fixed assets||13.37%||17.81%|-4.44%||
|Construction in|341,749.17||940,841.00||||
|||0.01%||0.04%|-0.03%||
|process|||||||

2. Major changes in liabilities
In RMB
||||||||
|-|-|-|-|-|-|-|
||2014||2013||||
|||Proportio||Proportion|||
||||||Change|Notes|
||Amount|n in total|Amount|in total|||
|||assets||assets|||
|Short-term loans|1,100,000,000.00|30.03%|369,000,000.00|14.19%|15.84%|Additional bank borrowing|

3. Assets and liabilities measured at fair value
In RMB
|||||||||
|-|-|-|-|-|-|-|-|
||||Accumulative|||||
|||Gain/loss|changes in fair|||||
|||||Impairment|Amount|||
||Opening|caused by|value|||Amount sold in|Closing|
|Items||||provided in the|purchased in|||
||amount|changes in fair|accounting into|||the period|amount|
|||||period|the period|||
|||value|the income|||||
||||account|||||

China Fangda Group Co., Ltd. 2014 Annual Report
|||||||
|-|-|-|-|-|-|
|Financial assets||||||
|1. Financial||||||
|assets||||||
|measured at||||||
|fair value with||||||
|variations||||||
|accounted into||||||
||0.00|-2,852,885.00||16,263,675.00|13,410,790.00|
|current income||||||
|account||||||
|(excluding||||||
|derivative||||||
|financial||||||
|assets)||||||
|Investment real||||||
||174,778,756.62|34,897,632.10|91,831.63||198,513,586.15|
|estate||||||
|Total|174,778,756.62|32,044,747.10|91,831.63|16,263,675.00|211,924,376.15|
|Financial||||||
||0.00||||0.00|
|liabilities||||||

Major changes in the assets measurement property of the Company in the report period
□ Yes√ No
4. Main overseas capital
□ Applicable√ Inapplicable
5 Core Competitiveness Analysis
(1) Curtain wall system and material
1. Expertise and brand competitiveness
In response to the national call for energy saving and emission reduction, the Company has aggressively develop solar electric and optimal and energy-saving curtain walls, developing a series of domestic and global leading solar and energy-saving curtain wall products. The Company owns 372 curtain wall and material patents (including 23 invention patents) and one software copyright, ranking top among domestic peers. It has achieved many firsts in the industry and created incomparable brand equity, making it an optimal choice in the domestic high-end curtain wall and material market. FANGDA is a nationwide well-known trademark in China.
2. Focusing on the high-end market to edge out competitors
Amid the fierce market competition, the Company has focused on the high-end energy-saving curtain wall market and technical integration to improve high-end project quality. Moreover, it has focused resources on high-end curtain wall engineering and won several Luban awards, Zhan Tianyou Civil Engineering awards and
Classic Construction for the
50th
Anniversary of the Foundation of thePeople’s Republic of China, High-Quality
Construction, White Magnolia Prize and Customer Satisfactory Engineering and the title of “Top 10 Competitive
Chinese Curtain Wall Provider”. The Company has build a leading brand and created a clear edge in the
China Fangda Group Co., Ltd. 2014 Annual Report high-end curtain wall market.
3. Well-developed industry base landscape
Thanks to continued investment in facilities, the Company has established a national business landscape with Shenzhen as the headquarters, Dongguan Songshanhu as the base in the south, Beijing in the north, Chengdu in the southwest and Shanghai and Nanchang in the east. The Dongguan Songshanhu and Nanchang bases are the largest and most advanced curtain wall system and material production bases in China and across the world, fueling the Company to increase its market share and competitiveness.
4. General supply advantage
TheCompany’s main business is design, production and engineering of curtain wall projects. The Company has expanded into the entire industry chain. It improves the overall supply capability, reduces raw material cost; and improves the engineering efficiency and engineering quality.
(2) New energy industry
In the report period, the Company set up the Shenzhen Fangda New Energy Co., Ltd. to develop solar energy PV applications, PV construction and LED industry. The move will extend theCompany’s energy-saving and environment protection business, coincide with the national plan and industry policies as well as the development trend of the industry.
1. Technical advantage
With more than tenyears’ experience in developing solar energy PV power generating curtain wall
technology, the Company is the earliest company that masters the intelligent property right in the designing, production and integration of solar energy PV curtain wall systems and is a pioneer in the application of PV curtain wall technology. The Company built the first solar energy PV integrated building curtain wall system in China– Shenzhen Fangda Building photoelectric curtain wall system.
2. Relation with other industries
Distributed solar PV industry is highly related to theCompany’s business. It is closely related to construction. Moreover, the Company has more than 10 years' experience in electrical product integration. The Company also has more than 20years’ experience in construction management and has the level-1 construction curtain wall engineering qualification and electrical installation engineering qualification.
3. Strategic advantage
The Company is engaged in the upper, middle and downstream of the LED industry and is familiar with industry policies in China. Currently, the Company is acquiring LED companies to realize fast expansion in the LED business and seek to create a new profit source for the Company.
(3) Rail transport equipment business
1. Technical advantage
Through continued independent innovation, the Company has developed the global leading metro screen door system with full intellectual property right and broken the monopoly of overseas competitors. The
Company has also compiled the Rail Transport Station Screen Door Standard, which is the first of its kind in China. The standard was approved in April 2006 and was implemented on March 1, 2007. As the first standard in the industry in China, the standard has played a key role in guiding the development ofChina’s rail transport screen door industry and enabled the Company a dominant lead in the industry. Currently, the Company has 218 metro screen door patents, including 40 invention patents. The Company also has seven computer software copyrights.
2. Brand equity
China Fangda Group Co., Ltd. 2014 Annual Report So far, the Company has undertaken rail screen door projects in cities including Beijing, Shanghai, Tianjin, Shenyang, Nanjing, Guangzhou, Shenzhen, Dongguan, Fuzhou, Nanchang, Wuhan,Xi’an, Dalian, Hong Kong, Taipei and Singapore. It The Fangda screen door system has grasped a leading market share and established incomparable brand influence thanks to its patents, standard and maintenance services. The Company has emerged as the Chinese No.1 and global No.3 screen door provider, building a large competitive edge in the global market.
(4) Real Estate
The Fangda Town renovation project is well-positioned and enjoys express transport, unique landscape resources, preferential policies and moderate competition in the district. In additional industry buildings for domestic use, the project comprises about 100,000
m2
of industry buildings for sales, 20,000
m2
of business property and 70,000
m2
of industry buildings for lease. The project will be put into pre-sales in Q4 2015 and sold out in 2017. The project will buoy theCompany’s net assets and total assets, bring strong cash flows for the Company, provide capital support for the development of businesses, and gain experience in the real-estate development industry.
VI. Investment
1. External equity investment
(1) External investment: None
(2) Financial enterprise share held: None
(3) Securities investment
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
|||||Number||||||||
|||||||Number||||||
|||||of shares||||||||
|||||||of shares||Closing||||
||||Initial|held at|Opening||Closing|||||
|||Abbreviat||||held at||book|Gain/loss|Accounti||
|Securities|Code||investmen|beginning|sharehold||sharehold||||Source|
|||ion||||end of the||value|(RMB)|ng item||
||||t cost|of the|ing||ing|||||
|||||||period||(RMB)||||
|||||period||||||||
|||||||(share)||||||
|||||(share)||||||||
|||Sino Oil||||||||Transacti||
|||and Gas|16,263,67|||100,000,0||13,410,79|-2,852,88|onal||
|Stock|00702|||0|0.00%||0.56%||||Purchase|
|||Holdings|5.00|||00||0.00|5.00|financial||
|||Ltd||||||||assets||
||||16,263,67|||100,000,0||13,410,79|-2,852,88|||
|Total||||0|--||--|||--|--|
||||5.00|||00||0.00|5.00|||
|Disclosure date of approval by||||||||||||
|the Board of Directors of|||March 11, 2014|||||||||
|securities investment||||||||||||
|Disclosure date of securities||||||||||||
||||None|||||||||
|investment approval by the||||||||||||

China Fangda Group Co., Ltd. 2014 Annual Report
||
|-|
|Shareholders’ Meeting (if any)|

(4) Shareholding in other listed companies: None
2. Trust wealth management, investment in derivatives and entrustment loan
(1) Wealth management
In RMB10,000
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
||||||||||||Actual|
||||||||||Impairme|||
|||Related|||||Earning|Principal|||gain/loss|
||Relations||Type of||||||nt|Estimate||
|Trustee||transactio||Amount|Start date|End date|recognitio|recovered|||in the|
||hip||product||||||provision|return||
|||n|||||n method|actually|||report|
||||||||||(if any)|||
||||||||||||period|
||||||||Estimated|||||
||||Break-eve|||||||||
|Bank of|Non-affili||||July 4,|August|annual|||||
|||No|n, fixed|2,000||||2,000|0|8.54|8.54|
|China|ated party||||2014|11, 2014|yield|||||
||||earning|||||||||
||||||||4.1%|||||
|CMB|||Not|||||||||
||||||||Estimated|||||
|Shenzhen|||earning-pr|||||||||
||Non-affili||||July 9,|Septembe|annual|||||
|Nanshan||No|otected|4,000||||4,000|0|33.75|33.75|
||ated party||||2014|r 3, 2014|yield|||||
|Sub-branc|||floating|||||||||
||||||||5.5%|||||
|h|||earning|||||||||
|CMB|||Not|||||||||
||||||||Estimated|||||
|Shenzhen|||earning-pr|||||||||
||Non-affili||||July 10,|August|annual|||||
|Nanshan||No|otected|4,000||||4,000|0|20.71|20.71|
||ated party||||2014|14, 2014|yield|||||
|Sub-branc|||floating|||||||||
||||||||5.4%|||||
|h|||earning|||||||||
|CMB|||Not|||||||||
||||||||Estimated|||||
|Shenzhen|||earning-pr|||||||||
||Non-affili||||October|October|annual|||||
|Nanshan||No|otected|3,000||||3,000|0|0.59|0.59|
||ated party||||17, 2014|20, 2014|yield|||||
|Sub-branc|||floating|||||||||
||||||||2.4%|||||
|h|||earning|||||||||
|CMB||||||||||||
||||||||Estimated|||||
|Shenzhen|||Break-eve|||||||||
||Non-affili||||October|October|annual|||||
|Nanshan||No|n, floating|6,695||||6,695|0|1.32|1.32|
||ated party||||17, 2014|20, 2014|yield|||||
|Sub-branc|||earning|||||||||
||||||||2.4%|||||
|h||||||||||||
|CMB|||Not||||Estimated|||||
|Shenzhen|Non-affili||earning-pr||October|October|annual|||||
|||No||4,695||||4,695|0|3.09|3.09|
|Nanshan|ated party||otected||21, 2014|31, 2014|yield|||||
|Sub-branc|||floating||||2.4%|||||

China Fangda Group Co., Ltd. 2014 Annual Report
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
|h|||earning|||||||||
||||||||Estimated|||||
|Bank of|Non-affili||Earning-p||December|January 4,|annual|||||
|||No||3,000|||||0|0.92||
|China|ated party||rotected||31, 2014|2015|yield|||||
||||||||2.8%|||||
|CMB|||Not|||||||||
||||||||Estimated|||||
|Shenzhen|||earning-pr|||||||||
||Non-affili||||October|October|annual|||||
|Nanshan||No|otected|10||||10|0|0.01|0.01|
||ated party||||10, 2014|17, 2014|yield|||||
|Sub-branc|||floating|||||||||
||||||||5.21%|||||
|h|||earning|||||||||
|CMB|||Not|||||||||
||||||||Estimated|||||
|Shenzhen|||earning-pr|||||||||
||Non-affili||||October|October|annual|||||
|Nanshan||No|otected|5,000||||5,000|0|5.67|5.67|
||ated party||||21, 2014|29, 2014|yield|||||
|Sub-branc|||floating|||||||||
||||||||5.17%|||||
|h|||earning|||||||||
||||Not|||||||||
||||||||Actual|||||
|CCB|||earning-pr|||||||||
||Non-affili||||December|January 4,|annual|||||
|Shenzhen||No|otected|6,000||||0|0|2.05||
||ated party||||31, 2014|2015|yield|||||
|Branch|||floating|||||||||
||||||||3.12%|||||
||||earning|||||||||
|CCB|||Not|||||||||
|Shenzhen|||earning-pr||||Estimated|||||
||Non-affili||||December|January 3,||||||
|OCT||No|otected|1,000|||yield|0|0|0.34|0|
||ated party||||31, 2014|2015||||||
|Sub-branc|||floating||||3.12%|||||
|h|||earning|||||||||
||||Not|||||||||
||||||||Estimated|||||
|CCB|||earning-pr|||||||||
||Non-affili||||December|January 4,|annual|||||
|Shenzhen||No|otected|6,800||||0|0|2.33|0|
||ated party||||31, 2014|2015|yield|||||
|Branch|||floating|||||||||
||||||||3.12%|||||
||||earning|||||||||
||||Not|||||||||
||||earning-pr||||Estimated|||||
|Bank of|Non-affili||||December|January 4,||||||
|||No|otected|3,000|||yield|0|0|2.07|0|
|China|ated party||||26, 2014|2015||||||
||||floating||||2.5%|||||
||||earning|||||||||
||||Not|||||||||
||||||||Estimated|||||
|CCB|||earning-pr|||||||||
||Non-affili||||December|January 3,|annual|||||
|Shenzhen||No|otected|3,000||||0|0|1.83|0|
||ated party||||31, 2014|2015|yield|||||
|Branch|||floating|||||||||
||||||||3.1%|||||
||||earning|||||||||
|Total||||52,200|--|--|--|29,400|0|83.22|73.68|

China Fangda Group Co., Ltd. 2014 Annual Report
|||
|-|-|
|Source of fund|Self-owned fund|
|Principal and return due but not covered|0|
|Lawsuit (if any)|None|
|Disclosure date of approval announcement||
||March 11, 2014|
|(if any)||
|Disclosure date of Shareholders' Meeting||
||None|
|approval announcement (if any)||

(2) Derivative investment
In RMB10,000
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
|||||||||||Proportio||
|||||||||||n of||
|||||||||||closing||
|||||||||||investmen|Actual|
|Derivativ||||||||Impairme||||
|||Related|||||Initial||Closing|t amount|gain/loss|
|e|Relations|||Initial||||nt||||
|||transactio|Type||Start date|End date|investmen||investmen|in the|in the|
|investmen|hip|||amount||||provision||||
|||n|||||t amount||t amount|closing|report|
|t operator||||||||(if any)||||
|||||||||||net assets|period|
|||||||||||in the||
|||||||||||report||
|||||||||||period||
|Shanghai||||||||||||
||||Shanghai||May 5,|July 23,||||||
|Futures|None|No||1,459.21|||0|0|0|0.00%|21.94|
||||aluminum||2014|2014||||||
|Exchange||||||||||||
|Total||||1,459.21|--|--|0|0|0|0.00%|21.94|
|Capital source||||Self-owned fund||||||||
|Lawsuit (if any)||||Inapplicable||||||||
|Disclosure date of derivative investment||||||||||||
|approval by the Board of Directors (if any)||||||||||||
|Disclosure date of derivative investment||||||||||||
|approval by the Shareholders’ Meeting (if||||None||||||||
|any)||||||||||||
|||||To prevent the risk of fluctuation of raw material prices, the Company adopted the||||||||
|Risk analysis and control measures for the||||||||||||
|||||aluminum futures exchanged at the domestic futures exchange to provide hedging for||||||||
|derivative holding in the report period||||||||||||
|||||aluminum as a raw material for the Company. The Company has set up and||||||||
|(including without limitation market,||||||||||||
|||||implemented the Provincial Regulations on China Fangda Group Domestic Futures||||||||
|liquidity, credit, operation and legal risks)||||||||||||
|||||Hedging to prevent risks.||||||||
|Changes in the market price or fair value of||||The fair value of the derivative should be calculated with the open quotation of the||||||||
|the derivative in the report period, the||||futures market and should be reviewed regularly to ensure effective hedging.||||||||

China Fangda Group Co., Ltd. 2014 Annual Report
|||
|-|-|
|analysis of the derivative’s fair value||
|should disclose the method used and||
|related assumptions and parameters.||
|Material changes in the accounting policies||
|and rules related to the derivative in the|No|
|report period compared to last period||
|Opinions of independent directors on the||
|Company’s derivative investment and risk|None|
|controlling||

(3) Trusted loans: None
3. Use of raised capital
(1) Overview
In RMB10,000
|||
|-|-|
|Total amount of the raised capital|33,658.69|
|Total raised capital invested in the report period|760.64|
|Total accumulative raised capital invested|31,431.04|
|Amount of raised capital of which the purpose was||
||0|
|changed in the report period||
|Accumulative amount of raised capital of which the||
||6,000|
|purpose has been changed||
|Proportion of raised capital of which the purpose has||
||17.83%|
|been changed||
|Notes to use of raised capital||
|By the end of the report period, the Company has strictly comply with the Instruction on Standard Operation of PLCs on the Main||
|Board of Shenzhen Stock Exchange and provisions for use and management of raised capital of the Company to deposit and use the||
|raised capital.. The raised capital totaled RMB314,31 million.||

(2) Promised raised-capital-based projects
In RMB10,000
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
||If|||||Investme|Date||||
|||Promised|||Accumul||||||
|Project promised to be|investme|||||nt|when the||Whether|Any|
|||total|Adjusted|Investme|ative|||Profit|||
|invested with the raised|nt project|||||progress|project||the|major|
|||investme|total|nt in the|investme|||realized|||
|capital and investment|is|||||by the|become||estimate|change in|
|||nt of the|investme|report|nt by the|||in the|||
|of the excessive raised|changed|||||end of the|useable||profit is|the|
|||raised|nt (1)|period|end of the|||period|||
|capital|(includin|||||period (3)|as||realized|feasibility|
|||capital|||period (2)||||||
||g partial|||||＝(2)/(1)|proposed||||

China Fangda Group Co., Ltd. 2014 Annual Report
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
||change)||||||||||
|Promised investment projects|||||||||||
|Energy-saving and PV|||||||||||
||||||||June 30,||||
|curtain wall production|Yes|21,000|27,000|631.15|25,370.21|93.96%||6,270.22|Yes|No|
||||||||2013||||
|expansion project|||||||||||
||||||||Decembe||||
|PSD production|||||||||||
||Yes|12,658.69|6,658.69|129.49|6,060.83|91.02%|r 31,|1,227.83|No|No|
|expansion project|||||||||||
||||||||2012||||
|Subtotal of promised|||||||||||
||--|33,658.69|33,658.69|760.64|31,431.04|--|--|7,498.05|--|--|
|investment projects|||||||||||
|Investment of excessive raised capital|||||||||||
|Total|--|33,658.69|33,658.69|760.64|31,431.04|--|--|7,498.05|--|--|
|Reason or situation that|||||||||||
|not on schedule (on|None||||||||||
|specific project)|||||||||||
|Notes to major changes|||||||||||
||None||||||||||
|in project feasibility|||||||||||
|Amount, purpose and|Inapplicable||||||||||
|use of excessive raised|||||||||||
|capital|||||||||||
||Applicable||||||||||
||Occurred in previous years||||||||||
|Changes in|||||||||||
||To improve the Company's industry landscape, simplify the Company’s management and reducemanagement costs, the 24th meeting of the 5th term of the Board of the Company approved the proposal ofchanging the implementation place of the energy-saving and photo-electric curtain wall productionexpansion project and increasing the implementation entities and changed the implementation place toDongguan, Guangdong.||||||||||
|implementation place|||||||||||
|of investment funded|||||||||||
|by raised capital|||||||||||
||Applicable||||||||||
|Adjustment of the|||||||||||
||Occurred in previous years||||||||||
|implementation way of|||||||||||
||On March 9, 2012, the 1st provisional shareholders’ meeting of the Company approved the adjustmentproposal to put the RMB60 million for the metro screen door production expansion to the energy-savingand photo-electric curtain wall production expansion project.||||||||||
|investment funded by|||||||||||
|raised capital|||||||||||
||Applicable||||||||||
||On September 30, 2010, it was decided to use the raised capital of RMB4,347,753.09 to replace theinvestment made previously by Fangda Automatic RMB1,403,503.00 and Fangda DecorationRMB2,944,250.09. This has been verified by CPA with report 天健正信审（2010）专字第020722号. Theexchange of a self-financed capital of RMB4,347,753.09 using the raised capital has been verified byAscenda Certified Public Accountants with 天健正信审（2010）专字第020722号 and Self-RaisedCapital Investment Project Verification Report issued.||||||||||
|Initial use of raised|||||||||||
|fund in projects and|||||||||||
|replacement|||||||||||

China Fangda Group Co., Ltd. 2014 Annual Report
|||
|-|-|
||Applicable|
||On September 30, 2010, payment of RMB20 million was made from idle proceeds to Fangda Decoration;and RMB10 million was made to Fangda Automatic. On March 22, 2011, the returned idle capital RMB30million was transferred to raise capital account. On March 28, 2011, payment of RMB20 million was madefrom idle proceeds to Fangda Decoration; and RMB10 million was made to Fangda Automatic. On August19, 2011, the returned idle capital RMB30 million was transferred to raise capital account. On August 23,2011, payment of RMB20 million was made from idle raised capital to Fangda jianke; and RMB10 millionwas made to Fangda Automatic. On February 16, 2012, the returned idle capital RMB30 million into theraised capital account. On February 22, 2012, payment of RMB20 million was made from idle proceeds toFangda Decoration; and RMB10 million was made to Fangda Automatic. On August 15, 2012, the returnedidle capital RMB30 million was transferred to raise capital account. On August 17, 2012, payment ofRMB20 million was made from idle proceeds to Fangda Decoration; and RMB10 million was made toFangda Automatic. On February 4, 2013 the returned idle capital RMB30 million was transferred to raisecapital account. On February 25, 2013, payment of RMB22 million was made from idle proceeds toFangda Decoration; and RMB8 million was made to Fangda Automatic. On July 15, 2013, the returnedidle capital RMB30 million was transferred to raise capital account.|
|Idle raised capital used||
|as working capital||
||Applicable|
||On July 15, 2013, the surplus raised capital (including interest income RMB was transferred to permanentworking capital. On August 22, 2014, raised capital (including interest) 5,150,302.35 was transferred topermanent working capital of the Company. The remaining raise capital was due to: 1. the Companystrictly implements multi-supply purchase system and project tendering and bidding regulations, thustrimming the engineering and equipment purchase costs. 2. in the process of engineering andconstruction, the Company has taken effective measures to control, supervise and manage engineeringcosts. 3. the Company has taken effective measures to improve utilization of its resources and optimizeits processes to cut the project investment.|
|Surplus of investment||
|and cause||
|Use plan of retained||
||Inapplicable|
|fund from financing||
|Problem or situation in||
|using of raised capital|None|
|and disclosing||

(3) Altering of projects financed by raised capital
In RMB10,000
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
|||Total||Accumulati|||||Any major|
||||||Investment|Date when||||
|||investment|Actual|ve actual||||Whether the|change in|
||Correspondi||||progress by|the project|Profit|||
|Altered||of raised|investment|investment||||estimate|the|
||ng promised||||the end of|become|realized in|||
|project||capital in|in the report|by the end||||profit is|feasibility|
||project||||the period|useable as|the period|||
|||the altered|period|of the||||realized|after the|
||||||(3)＝(2)/(1)|proposed||||
|||project (1)||period (2)|||||alteration|
|Energy-savi|Energy-savi|||||June 30,||||
|||27,000|631.15|25,370.21|93.96%||6,270.22|Yes|No|
|ng and PV|ng and PV|||||2013||||

China Fangda Group Co., Ltd. 2014 Annual Report
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
|curtain wall|curtain wall|||||||||
|production|production|||||||||
|expansion|expansion|||||||||
|project|project|||||||||
|2. PSD|2. PSD|||||December31, 2012||||
|production|production|||||||||
|||6,658.69|129.49|6,060.83|91.02%||1,227.83|No|No|
|expansion|expansion|||||||||
|project|project|||||||||
|Total|--|33,658.69|760.64|31,431.04|--|--|7,498.05|--|--|
||||The screen door project in Nanchang aimed to use a plant in Dafang Jiangxi new material|||||||
||||industry zone as the production base. This can reduce the investment of RMB60 million for|||||||
||||new plant, office and facilities. According to the resolution of the 24th meeting of the 5th|||||||
||||term of the Board, the proposal of changing the implementation place of the energy-saving|||||||
|Alteration reason, decision-making||||||||||
||||and photo-electric curtain wall production expansion project and increasing the|||||||
|process and information disclosure (by||||||||||
||||implementation entities was approved to change the implementation place to Dongguan,|||||||
|project)||||||||||
||||Guangdong. As a new factory and part of the office and facilities must be built in|||||||
||||Dongguan, the investment is forecast to increase to RMB75 million. Given the alteration|||||||
||||of the two projects, the capital RMB 60 million for the screen door project is transferred to|||||||
||||the curtain wall project, while the insufficient part made up by the self-owned capital.|||||||
||||The delivery process of metro screen door takes a long period of time. The Company|||||||
|Reason or situation that not on|||received orders of RMB613 million from 2013 to 2014, accounting for nearly 70% of the|||||||
|schedule (on specific project)|||national aggregate. Orders to be delivered by the end of 2014 are worth RMB468 million.|||||||
||||The screen door production expansion will support the sales and order delivery.|||||||
|Notes to major changes in project||||||||||
||||None|||||||
|feasibility after the alteration||||||||||

4. Analysis of major subsidiaries and joint-stock companies
Major subsidiaries and joint-stock companies
In RMB
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
||||Main|||||||
|Compan|||products|Registered||||Operation||
||Type|Industry|||Total assets|Net assets|Turnover||Net profit|
|y|||or|capital||||profit||
||||services|||||||
||||Curtain|||||||
|Fangda|Subsidia|Decorati|||||1,499,837,703.29|81,813,917.|70,755,15|
||||wall|500,000,000|2,297,588,580.12|749,684,129.22||||
|Jianke|ry|on||||||19|6.37|
||||system|||||||
|Fangda|||Metro|||||||
||Subsidia|Railroad|||||163,158,433.01|9,060,690.9|8,973,274|
|Automat|||screen|105,000,000|396,147,819.22|192,209,221.13||||
||ry|industry||||||9|56|
|ic|||door|||||||
|Kexunda|Subsidia|Railroad|Software|1,000,000.00|57,361,368.99|2,774,714.13|13,472,393.|10,975,280.|12,861,41|

China Fangda Group Co., Ltd. 2014 Annual Report
||||||||
|-|-|-|-|-|-|-|
|Co.|ry|industry|develop|23|62|5.59|
||||ment||||
||||and||||
||||system||||
||||integrati||||
||||on||||

Major subsidiaries and joint-stock companies
None
Acquisition and disposal of subsidiaries in the report period
√ Applicable□ Inapplicable
|||||
|-|-|-|-|
||Acquisition and disposal|Acquisition and disposal||
||||Impact on production and|
|Company|purpose of subsidiaries in the|method of subsidiaries in the||
||||performance|
||report period|report period||
|Guangdong Fangda SOZN|Speed up expansion to LED|||
|||Purchase|Create new profit growth|
|Lighting Co., Ltd.|business|||

5. Major projects of non-raised capital: None
VII. Forecast of operating performance between January and March in 2015
Warning and reasons of possible net loss or substantial change from the last period between the beginning of the year and the end of the next report period
□ Applicable√ Inapplicable
VIII. Entities on which the Company has control power: None
IX. Future Prospect
(1) Industry competition map and development trend
Curtain wall and material system industry
According to the Chinese Building Decoration Industry
12th
Five-year Plan, the domestic building curtain wall industry is worth RMB400 million in 2015. The urbanization will accelerate the market demand and give a strong booth to the development of the industry. The government also released a series of policies to support the development of the industry.
(2) New energy industry
1. Solar power industry
The solar power generation industry is supported by the Chinese government. Since late 2012, the state council, finance minister, energy administration and state grid have issued a series of policies to regulate various issues related to PV power generation and subsidies for distributed power plants. Despite that most on-grid power generation is centralized power plants, accounting for84% in 2013, distributed power plants will develop rapidly
with the government support.
(2) LED light
China Fangda Group Co., Ltd. 2014 Annual Report LED as the new lighting technology has won support in many countries and organizations, which issued many policies to support the development of the industry. The retirement of incandescent light bulbs will explode the development of LED lights. In November 2011, China released the incandescent light bulb retirement
roadmap. All incandescent light bulbs will be retired in China by 2016. Recently, National Development and Reform Committee and tax administration released the announcement on subsidies for EMC project enterprise. The government concern for energy conservation will boost the development of the LED industry.
(3) Rail transport equipment business
In the
12th
Five-year period, the urban metro and railway construction mileage will reach2,600km, with a total investment of RMB1.27 trillion. Screen door is a key device for metro. Therefore, the demand will remain strong.
(4) Real estate
As the land resource becomes increasingly rare, the urban renovation has become a common issue for many large cities. Shenzhen government has released a series of policies to encourage renovation projects. Fangda Town renovation project is located into the crossroad of Dashahe Innovation Corridor and OCT cultural
innovation ring.
(2) Corporate development strategy and operating plan
2015 will witness remarkable innovation and development, as well as business, concept transformation of the Company. A series of internal reforms will be launched to improve the comprehensive competitiveness and operation efficiency, fueling theCompany’s long-term development. The development of the new energy business is a strategic part in theCompany’s development plan. The Company will grasp the gold opportunities to blend industry, financial and business innovation and blaze a new trail in developing the new energy industry. The Company will further consolidate its position as the domestic leading supplier of metro screen doors and expand into the global market. The Company will ensure the quality of the Fangda Town renovation project and meet the sales target.
(3) Capital demand for support existing business and construction in progress
The development of theCompany’s main business and Fangda Town renovation project increase the capital demand. Therefore, the Company has approved the proposal of private A-share issuing to raise RMB1.008 billion, which will be used to fund construction of solar power plants. To realize the operating target in 2015, the
Company will formulate reasonable financial and capital plans to add more financing channels and self-owned fund and bank loans to meet the capital demand.
(4) Potential risks and measures
1. Market risks and measures
As the overall designing and engineering quality continues improving in the domestic construction curtain wall industry, curtain wall products will become increasingly standard, intensifying the market competition. The Company will continue implementing a prudent operation strategy, fine management and technical innovation to lower the management costs and accelerate the recovery of receivables. Through new technologies and processes, we will improve product quality, lower costs and elevate earnings. While consolidating the domestic market, the Company will step up the efforts in exploring overseas markets, thus elevating our competitiveness in global markets and improving our resistance to risks.
2. Management risks and measures
With an increase in orders in recent years and operation of six industry bases, the Company has continued expanding rapidly in terms of capitalization, business and teams. The organizational structure and management system have become more complicated, leading to management risks in industry expansion. The Company will
China Fangda Group Co., Ltd. 2014 Annual Report continue to improve the matrix management mode, integrate business management, optimize the business flow, seeking to build a high-efficient and solid management team. We will introduce high-quality, professional technical and management talents in different fields to strengthen the Company's core competitiveness.
3. Production and operation risks and measures
The macro-economy and market demand have added to the fluctuation in prices of main raw materials such as aluminum and steel and labor, affecting theCompany’s profitability and creating additional production and operation risks for the Company. The Company has sought to lower the purchase and production costs, pay attention to technicalR&D, reduce consumption of raw materials, introduce automatic and intelligent production equipment, and strengthen staff training to improve working efficiency.
4. Management and implementation risks in Fangda Town renovation project and measures
As the first real-estate project undertaken by the Company, the Fangda Town renovation project may lead to risks for the company in project management and implementation. The Company has recruited a professional and experienced team and a solid internal control system to manage and implement the project.
X Statement of the Board on the “non-standardauditors‟ report” issued by the CPA on the current report period
□ Applicable√ Inapplicable
XI TheCompany‟s accounting policies, estimates and calculation methods have remained unchanged from the last annual report.
XII. Retrospective restatement of major accounting errors in the report period
13. Statement of change in the financial statement consolidation scope compared with the previous financial report
√ Applicable□ Inapplicable
Acquire Guangdong Fangda SOZN Lighting Co., Ltd. under different control in the report period.
Fangda New Energy and Shihui International Holding were established and consolidated in the period. Fangda Yi was liquidated in the period and removed from consolidate statements.
XIV Profit distribution and dividend payment of the Company
Formulation, execution or adjustment of profit distribution policy in the report period
√ Applicable□ Inapplicable
To regulate cash dividend distribution and improve distribution transparency, according to CSRC[2013] No.43 Cash Dividend of Listed Companies, the Company revised profit distribution policies and terms in the Articles of Associations and formulated the Shareholder Return Plan for 2015-2017, which were approved at the 8th
meeting of the
7th
Board of Directors and
1st
extraordinaryshareholders’ meeting in 2015.
During the report period, the Company implemented the profit distribution plan for 2013. Approved at the Shareholders' Meeting 2013 held on March 31, 2014, the Company's profit distribution plan for 2013 is
distributing a cash dividend of RMB0.30 (tax-included) for every ten shares of all the shareholders based on a
China Fangda Group Co., Ltd. 2014 Annual Report total of 756,909,905 shares on December 31, 2013. The plan was implemented on April 15, 2014 (see the 2013 Share Equity Distribution Implementation Announce 2014-29).
|||
|-|-|
|Explanation of Cash Dividend Distribution Policies||
|Comply with the Articles of Association or resolution made at||
||Yes|
|the General Shareholders' Meeting||
|Clear and definite distribution standard and proportion|Yes|
|Decision-making procedure and mechanism|Yes|
|Independent directors fulfill their duties|Yes|
|Middle and small shareholders express their opinions and claims.||
||Yes|
|There rights are well protected.||
|Cash dividend distribution policies are adjusted or revised||
||Yes|
|according to law||

Profit distribution and reserve capitalizing pre-plans or plans over the recent three years (including the reporting period)
2012: A cash dividend of RMB0.30 (including tax) for each ten shares is issued to all shareholders on the basis of 756,909,905 shares with a total amount of RMB 22,540,512.87, on December 31, 2012. No dividend share or capitalization share is issued in the year.
2013: A cash dividend of RMB0.30 (including tax) for each ten shares is issued to all shareholders on the basis of 756,909,905 shares with a total amount of RMB 22,707,297.15, on December 31, 2013. No dividend share or capitalization share is issued in the year.
2014: A cash dividend of RMB0.30 (including tax) for each ten shares is issued to all shareholders on the basis of 756,909,905 shares with a total amount of RMB 22,707,297.15, on December 31, 2014. No dividend share or capitalization share is issued in the year.
Cash dividends for the recent three years
In RMB
|||||||
|-|-|-|-|-|-|
||||||Proportion of the|
|||Net profit|Proportion in the net|Amount of||
||||||amount of|
|||attributable to|project attributable|repurchased share||
||Cash dividend||||repurchased share|
|Year||shareholders in the|to shareholders in|capital in cash||
||(including tax)||||capital in cash|
|||consolidated|the consolidated|included in cash||
||||||included in cash|
|||financial statements|financial statements|dividend||
||||||dividend|
|2014|22,707,297.15|96,998,429.76|23.41%|0.00|0.00%|
|2013|22,707,297.15|85,676,863.78|26.50%|0.00|0.00%|
|2012|22,540,512.87|24,948,377.20|90.35%|0.00|0.00%|

 No cash dividend is proposed despite the Company records profits in the report period and a positive undistributed
profit/
□ Applicable√ Inapplicable
China Fangda Group Co., Ltd. 2014 Annual Report XV Profit Distribution and Reserve Capitalization Plan in the Report Period
√ Applicable□ Inapplicable
|||
|-|-|
|Bonus shares for every ten shares|0|
|Cash dividend for every ten shares (yuan,||
||0.30|
|tax-included)||
|Share dividend for each ten shares (share)|0|
|A total number of shares as the distribution basis|756,909,905|
|Total cash dividend (yuan, including tax)|22,707,297.15|
|Distributable profit (yuan)|404,322,761.53|
|Proportion of cash dividend in the distributable||
||100.00%|
|profit||
|Cash dividend distribution policy||
|The Company is in a fast growth stage. Therefore, the cash dividend will reach 20% of the profit distribution at least.||
|Details of profit distribution or reserve capitalization plan||
|The Company plans to distribute a cash dividend of RMB0.30 (including tax) for each ten shares issued to all shareholders on||
|the basis of 756,909,905 shares with a total amount of RMB22,707,297.15, on December 31, 2014. No dividend share or||
|capitalization share is issued in the year.||
|The plan needs to be reviewed and approved at the General Shareholders' Meeting 2014.||

XVI Social responsibilities
√ Applicable□ Inapplicable
In the reporting period, the Company has positively assumed social responsibilities by: paying taxes RMB105 million, up13.20% year-on-year; donating RMB958,000 and investing RMB771,800 in environment protection, create nearly 10,000 jobs; inputting RMB2.1421 million in employee knowledge and skill training. The company has invested RMB86.77 million to promote development of new draft, technology, product structure and patent according to clean, safety and efficient production to make contribution for environmental protection.
Are the listed company and subsidiaries involved in a heavy-pollution industry defined by the national
environment protection department?
□ Yes√ No□ N/A
Do the listed and subsidiaries cause any material security problems to the society?
□ Yes√ No□ N/A
Did the listed and subsidiaries receive any administration penalty in the report period?
□ Yes√ No□ N/A
China Fangda Group Co., Ltd. 2014 Annual Report XVII Reception of investigations, communications, or interviews in the reporting period√ Applicable□ Inapplicable
|||||||
|-|-|-|-|-|-|
||||||Main content involved and|
|Time/date|Place|Way|Visitor|Visitor||
||||||materials provided|
|||||Industrial||
|||||Securities,||
|||Onsite|||Business and future|
|March 13, 2014|Shenzhen||Institution|Goldstate||
|||investigation|||development|
|||||Securities and||
|||||Guosen Securities||
|||Onsite||Goldstate|Business and future|
|March 18, 2014|Shenzhen||Institution|||
|||investigation||Securities|development|
|||Onsite|||Business and future|
|March 19, 2014|Shenzhen||Institution|Essences Securities||
|||investigation|||development|
|||Onsite||Dongxing|Business and future|
|April 23, 2014|Shenzhen||Institution|||
|||investigation||Securities|development|
|||Onsite|||Business and future|
|May 14, 2014|Shenzhen||Institution|Minsen Investment||
|||investigation|||development|
|||||Industrial||
|||||Securities,||
|||||Citic-Prudential||
|||||Fund, CCFund,||
|||Onsite||Fortune SG Fund,|Business and future|
|May 21, 2014|Shenzhen||Institution|||
|||investigation||Bosera Fund,|development|
|||||Essence Fund,||
|||||Galaxy AMC,||
|||||Qianhai QianBaBa||
|||||Fund||
|||Onsite|||Business and future|
|June 26, 2014|Shenzhen||Institution|China Post Fund||
|||investigation|||development|
|||Onsite|||Business and future|
|July 4, 2014|Shenzhen||Institution|Fullgoal Fund||
|||investigation|||development|
|||||CMS, Shenyin &||
|||Onsite|||Business and future|
|July 8, 2014|Shenzhen||Institution|Wanguo, Southern||
|||investigation|||development|
|||||Fund||
|||||GF Securities,||
|||||Invesco Great Wall||
|||Onsite||fund, QHKY Fund,|Business and future|
|July 14, 2014|Shenzhen||Institution|||
|||investigation||Industrial|development|
|||||Securities,||
|||||Prudential Fund||

China Fangda Group Co., Ltd. 2014 Annual Report
||||||||
|-|-|-|-|-|-|-|
||Shenzhen,||||||
|||Onsite||||Business and future|
|July 24, 2014|Dongguan|||Institution|Shenyin & Wanguo||
|||investigation||||development|
||Songshanhu||||||
|||Onsite|||Hong Yuan|Business and future|
|September 3, 2014|Shenzhen|||Institution|||
|||investigation|||Securities|development|
|||Onsite||||Business and future|
|November 3, 2014|Shenzhen|||Institution|Shenyin & Wanguo||
|||investigation||||development|
|||Onsite||||Business and future|
|November 13, 2014|Shenzhen|||Institution|Yuanta Funds||
|||investigation||||development|
||||||Shenyin &||
||||||Wanguo, China||
||||||Investment||
||||||Securities, Invesco||
|||Onsite|||Great Wall fund,|Business and future|
|December 2, 2014|Shenzhen|||Institution|||
|||investigation|||Yintai Securities,|development|
||||||Qianhai Anzhou||
||||||Capital, Rongyao||
||||||Investment, Daoyi||
||||||Assets||
|Number of reception|||15||||
|Number of institutions|||34||||
|Disclosed or leaked uncovered material|||||||
||||No||||
|information|||||||

China Fangda Group Co., Ltd. 2014 Annual Report V Significant Events
I. The Company has no significant lawsuit or arbitration affair in the report period.
II. The Company has no significant affair that arouses media questioning.
III. The controlling shareholder and its affiliates occupied no capital for non-operating purpose of the Company during the report period.
IV. The Company has no bankruptcy or reorganization events in the report period.
V. Assets trade
1. The Company required no assets in the report period.
2. The Company sold no assets in the report period.
3. Enterprise merger
√ Applicable□ Inapplicable
On July 18, 2014, the Company entered into an agreement with natural person Luo Huichi to acquire60% stake in the Guangdong Fangda SOZN Lighting Co., Ltd (“New Company”) set upo with the fixed assets, intangible assets, sales networks and teams of three LED lighting companies controlled by Luo. The investment does not exceed RMB48 million in cash. The payment includes conditional stock transfer to Luo and conditional investment to the New Company. The Announcement on Acquiring Zhongshan SOZN Lighting Co., Ltd. and LED Lighting Business of Its Affiliates was published on China Securities Journal, Shanghai Securities Daily,
Securities Times, HKCD and www.cninfo.com.cn on July 22, 2014. The acquisition will accelerate the
Company’s LED business expansion and create new profit growth opportunities. As part of theCompany’s new energy development strategy, it coincides with theCompany’s development shift onto energy-saving industries and will optimize theCompany’s business structure, thus propelling theCompany’s long-term growth. The acquisition has completed as scheduled. Fangda SOZN recorded a tax-included income of RMB136,832,908.41 between July and December 2014.
China Fangda Group Co., Ltd. 2014 Annual Report VI. The Company made or implemented no option incentive scheme in the report period. VII. Material related transactions
1. The Company made no related transaction related to daily operating in the report period.
2. The Company made no related transaction of assets requisition and sales in the report period.
3. The Company made no related transaction of joint external investment in the report period.
4. The Company had no related debt in the report period.
5. The Company has no other related transaction in the report period.
VIII. Significant contracts and performance
1. Asset entrusting, leasing, contracting
(1) The Company made no custody in the report period
(2) The Company made no contract in the report period
(3) Leasing
Leasing
The Company leases investment real estates and obtained a lease income of RMB25,160,000 in the report period. Projects that create gains accounting for over10% of theCompany’s total profit in the report period
□ Applicable√ Inapplicable
The Company leased no projects that create gains accounting for over10% of theCompany’s total profit in the report period.
2. Guarantee
The Company made no external guarantee (excluding for subsidiaries)
In RMB10,000
||||||||||
|-|-|-|-|-|-|-|-|-|
|Guarantee provided to subsidiaries|||||||||
||||Actual date of||||||
|Guarantee provided|Date of|Guarantee|occurring|Actual amount|Type of||Complete|Related|
|||||||Term|||
|to|disclosure|amount|(signing date of|of guarantee|guarantee||d or not|party|
||||agreements)||||||
|||||||since engage|||
||March 11,||September 3,||||||
|Fangda Jianke||36,000||22,823.38|Joint liability|of contract to|No|No|
||2014||2014||||||
|||||||2 years upon|||

China Fangda Group Co., Ltd. 2014 Annual Report
||||||||||
|-|-|-|-|-|-|-|-|-|
|||||||due of debt|||
|||||||since engage|||
||March 11,||October 20,|||of contract to|||
|Fangda Jianke||20,000||19,945.62|Joint liability||No|No|
||2014||2014|||2 years upon|||
|||||||due of debt|||
|||||||since engage|||
||March 11,||September 9,|||of contract to|||
|Fangda Jianke||25,000||14,613.72|Joint liability||No|No|
||2014||2014|||2 years upon|||
|||||||due of debt|||
|||||||since engage|||
||March 11,|||||of contract to|||
|Fangda Jianke||20,000|June 16, 2014|19,822.97|Joint liability||No|No|
||2014|||||2 years upon|||
|||||||due of debt|||
|||||||since engage|||
||March 11,||September 30,|||of contract to|||
|Fangda Jianke||21,428||9,683.29|Joint liability||No|No|
||2014||2014|||2 years upon|||
|||||||due of debt|||
|||||||since engage|||
||November||November 11,|||of contract to|||
|Fangda Jianke||15,000||3,850|Joint liability||No|No|
||8, 2014||2015|||2 years upon|||
|||||||due of debt|||
|||||||since engage|||
||March 11,||September 3,|||of contract to|||
|Fangda Automatic||20,000||13,266.57|Joint liability||No|No|
||2014||2015|||2 years upon|||
|||||||due of debt|||
|||||||since engage|||
||November||November 11,|||of contract to|||
|Fangda Automatic||5,000||2,660|Joint liability||No|No|
||8, 2014||2015|||2 years upon|||
|||||||due of debt|||
|||||||since engage|||
|Fangda New|March 11,|||||of contract to|||
|||7,080|April 11, 2015|2,977.68|Joint liability||No|No|
|Material|2014|||||2 years upon|||
|||||||due of debt|||
|||||||since engage|||
|Fangda New|March 11,|||||of contract to|||
|||8,000|May 5, 2015|5,573.29|Joint liability||No|No|
|Material|2014|||||2 years upon|||
|||||||due of debt|||
|||||||since engage|||
||January 4,||January 29,|||of contract to|||
|Fangda Property||21,000||11,000|Joint liability||No|No|
||2014||2014|||2 years upon|||
|||||||due of debt|||

China Fangda Group Co., Ltd. 2014 Annual Report
|||||
|-|-|-|-|
|||Total of guarantee to||
|Total of guarantee to subsidiaries||||
||264,000|subsidiaries actually occurred|148,787.48|
|approved in the report term (B1)||||
|||in the report term (B2)||
|||Total of balance of guarantee||
|Total of guarantee to subsidiaries||||
|||actually provided to the||
|approved as of the report term|264,000||126,216.53|
|||subsidiaries as of end of||
|(B3)||||
|||report term (B4)||
|Total of guarantee provided by the Company (total of the above two)||||
|Total of guarantee approved in the||Total of guarantee occurred in||
||264,000||148,787.48|
|report term (A1+B1)||the report term (A2+B2)||
|||Total of guarantee occurred as||
|Total of guarantee approved as of||||
||264,000|of the end of report term|126,216.53|
|end of report term (A3+B3)||||
|||(A4+B4)||
|Percentage of the total guarantee occurred (A4+B4) on net asset||||
|||102.21%||
|of the Company||||

The Company made no incompliant external guarantee in the report period.
3. The Company entered into no other significant contract in the report.
4. The Company entered into no other significant contract in the report period.
IX. Performance of promises
1. The Company and shareholders with more than5% stakes in the Company made no guarantee in the report period or before report period but remaining effective in the report period.
2. Explanation and reason of profit forecasts on assets or projects that remain in the report period
□ Applicable√ Inapplicable
10. Engaging and dismissing of CPA
CPA engaged currently
|||
|-|-|
|Domestic public accountants name|Grant Thornton (special general partner)|
|Remuneration for the domestic public accountants||
||130|
|(in RMB10,000)||
|Consecutive years of service by the domestic public||
||3|
|accountants||
|Name of certified accountants of the domestic public||
||Lin Kaiqin and Li Chunmei|
|accountants||

China Fangda Group Co., Ltd. 2014 Annual Report
|||
|-|-|
|Overseas public accountants name (if any)|None|
|Remuneration for the overseas public accountants||
||0|
|(in RMB10,000)||
|Consecutive years of service by the overseas public||
||None|
|accountants (if any)||
|Name of certified accountants of the overseas public||
||None|
|accountants (if any)||

The CPA is not replaced
□ Yes√ No
Engaging of internal control audit CPA, financial advisor and sponsor
√ Applicable□ Inapplicable
This year, the Company continued engaging Grant Thornton (special general partner) as the internal control CPA. The financial statement review fee is RMB1.3 million.
11. Statement of the Supervisory Committee and Independent Directors (if applicable) on the “non-standardauditors‟ report” issued by the CPA on the current report period
□ Applicable√ Inapplicable
XII. The Company received no penalty and made no correction in the report period.
XIII. Trade suspension and termination after the disclose of the annual report
XIV. The Company had no other significant event to be explained in the report period.
XV. Material events of subsidiaries
XVI. The Company issued no corporate bonds in the period.
China Fangda Group Co., Ltd. 2014 Annual Report VI Changes in Share Capital and Shareholders
1. Changes in shares
1. Changes in shares
In share
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
||Before the change||Change (+,-)|||||After the change||
||||Issued||Transferre|||||
|||||Bonus|||Subtot|||
||Amount|Proportion|new||d from|Others||Amount|Proportion|
|||||shares|||al|||
||||shares||reserves|||||
|I. Shares with trade||||||||||
||779,292|0.10%||||||779,292|0.10%|
|restriction conditions||||||||||
|3. Other domestic shares|779,292|0.10%||||||779,292|0.10%|
|Domestic natural||||||||||
||779,292|0.10%||||||779,292|0.10%|
|person shares||||||||||
|II. Shares without trading||||||||||
||756,130,613|99.90%||||||756,130,613|99.90%|
|limited conditions||||||||||
|1. Common shares in RMB|420,179,425|55.51%||||||420,179,425|55.51%|
|2. Foreign shares in||||||||||
||335,951,188|44.39%||||||335,951,188|44.39%|
|domestic market||||||||||
|III. Total of capital shares|756,909,905|100.00%||||||756,909,905|100.00%|

 Reasons
□ Applicable√ Inapplicable
Approval of the change
□ Applicable√ Inapplicable
Share transfer
□ Applicable√ Inapplicable
Impacts on financial indicators including basic and diluted earnings per share, net assets per share attributable to common shareholders of the company in the most recent year and period
□ Applicable√ Inapplicable
Others that need to be disclosed as required by the securities supervisor
□ Applicable√ Inapplicable
China Fangda Group Co., Ltd. 2014 Annual Report 2. No change in shares with sales restriction
2. Share placing and listing
1. The Company issued no securities in the recent three years
□ Applicable√ Inapplicable
2. Statement of changes in share number and shareholder structure, assets and liabilities structure
□ Applicable√ Inapplicable
3. Currentemployees‟ shares
□ Applicable√ Inapplicable
3. Shareholders and the substantial controller of the Company
1. Shareholders and shareholding
In share
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
||||||52,741||Number of|||||
||||Number of ordinary|||||||||
|Number of|||||||shareholders of|||||
||||shareholders by the|||||||||
|shareholders of|||||||preferred stocks of|||||
||||end of the 5th date|||||||||
|common shares at|46,209||||||which voting rights|||0||
||||day before the|||||||||
|the end of the report|||||||recovered in the|||||
||||disclosure date of the|||||||||
|period|||||||report period (if any,|||||
||||annual report|||||||||
||||||||see Note VIII)|||||
|Shareholders holding 5% of the Company's shares or top-10 shareholders||||||||||||
|||||Number of|||||Pledging or freezing|||
|||||||||Amount of||||
|||||shares held at|Change in the|Conditio||||||
||Properties of|Shareholdi||||||shares without||||
|Shareholder||||the end of the|reporting|nal|||Share|||
||shareholder|ng||||||sales|||Amount|
|||||reporting|period|shares|||status|||
|||||||||restriction||||
|||||period||||||||
|Shenzhen BanglinTechnologiesDevelopment Co.,Ltd.|Domesticnon-state legalperson|9.09%||68,774,273|0|||68,774,273||||
||||||||||Pledged||14,150,000|
|Shengjiu InvestmentLtd.|Foreign legalperson|5.00%||37,845,591|+11,199,085|||37,845,591||||
|Huang Jupei|Domesticnatural person|3.96%||30,001,000|+5,083,800|||30,001,000||||

China Fangda Group Co., Ltd. 2014 Annual Report
|||||||||
|-|-|-|-|-|-|-|-|
|Zhou Shijian|Domesticnatural person|2.79%|21,123,481|+21,123,481|21,123,481|||
|Shenzhen ShiliheInvestment Co., Ltd.|Domesticnon-state legalperson|2.36%|17,860,992|0|17,860,992|||
|Yu Liandi|Domesticnatural person|1.34%|10,121,923|+10,121,923|10,121,923|||
|National SocialInsurance PortfolioNo.109|Others|1.32%|9,999,832|+9,999,832|9,999,832|||
|Jiang Jing|Domesticnatural person|1.19%|9,029,914|-1,605,526|9,029,914|||
|ICBC-Lion FundStock InvestmentFund|Others|1.12%|8,513,474|+8,513,474|8,513,474|||
|Bank ofCommunication –Huaan ChuangxinSecuritiesInvestment Fund|Others|0.79%|5,995,718|+5,995,718|5,995,718|||
|A strategic investor or ordinary||||||||
|legal person becomes the Top10||None||||||
|shareholder due a stock issue.||||||||
|||Among the shareholders, Shenzhen Banglin Technology Development Co., Ltd. and Shengjiu||||||
|||Investment Co., Ltd. are parties action-in-concert. Shenzhen Banglin Technology||||||
|Notes to top ten shareholderrelationship or "action in concert"||||||||
|||Development Co., Ltd. and Shenzhen Shilihe Investment Co., Ltd. are related parties. The||||||
|||Company is not notified of other action-in-concert or related parties among the other holders||||||
|||of current shares.||||||
|Top 10 holders of unconditional shares||||||||
|||||||Category of shares||
|Shareholder||Amount of shares without sales restriction||||Category of||
||||||||Amount|
|||||||shares||
|Shenzhen Banglin TechnologiesDevelopment Co., Ltd.||68,774,273||||RMB common||
||||||||68,774,273|
|||||||shares||
|Shengjiu Investment Ltd.||37,845,591||||Foreign shares||
|||||||listed in domestic|37,845,591|
|||||||exchanges||
|Huang Jupei||30,001,000||||RMB common||
||||||||30,001,000|
|||||||shares||
|Zhou Shijian||21,123,481||||RMB common|21,123,481|

China Fangda Group Co., Ltd. 2014 Annual Report
|||||
|-|-|-|-|
|||shares||
|Shenzhen Shilihe Investment Co.,Ltd.|17,860,992|RMB common||
||||17,860,992|
|||shares||
|Yu Liandi|10,121,923|RMB common||
||||10,121,923|
|||shares||
|National Social Insurance PortfolioNo.109|9,999,832|RMB common||
||||9,999,832|
|||shares||
|Jiang Jing|9,029,914|RMB common||
||||9,029,914|
|||shares||
|ICBC-Lion Fund Stock InvestmentFund|8,513,474|RMB common||
||||8,513,474|
|||shares||
|Bank of Communication – HuaanChuangxin Securities InvestmentFund|5,995,718|||
|||RMB common||
||||5,995,718|
|||shares||
|No action-in-concert or related||||
||Among the top 10 shareholders, Shenzhen Banglin Technology Development Co., Ltd. and|||
|parties among the top10||||
||Shengjiu Investment Co., Ltd. are parties action-in-concert. Shenzhen Banglin Technology|||
|unconditional shareholders and||||
||Development Co., Ltd. and Shenzhen Shilihe Investment Co., Ltd. are related parties. The|||
|between the top10 unconditional||||
||Company is not notified of other action-in-concert or related parties among the other holders|||
|shareholders and the top10||||
||of current shares.|||
|shareholders||||
||Huang Jupei holds 30,000,000 shares of the Company through GF Securities customer credit|||
||transaction guarantee securities account; Zhou Shijian holds 21,123,481 shares of the|||
|Participation by top-10 ordinary||||
||Company through GF Securities customer credit transaction guarantee securities account, Yu|||
|shareholders in financing bonds (if||||
||Liandi holds 10,121,923 shares of the Company through GF Securities customer credit|||
|any)||||
||transaction guarantee securities account; Jiang Jing holds 9,024,914 shares of the Company|||
||through Everbright Securities customer credit transaction guarantee securities account.|||

 Agreed re-purchasing by theCompany’s top 10 shareholders of common shares and top 10 shareholders of unconditional common shares in the report period
2. Profile of the controlling shareholders
Legal person
|||||||
|-|-|-|-|-|-|
||Legal|||||
|Name of controlling||Date of||||
||representative/resp||Organization code|Registered capital|Main business|
|shareholder||establishment||||
||onsible person|||||
||||||Industrial investment,|
||||||developing of electronic|
|Shenzhen Banglin||||||
||||||products, technical|
|Technologies|Chen Jinwu|June 7, 2001|72984005-5|RMB 30 million||
||||||consulting, domestic|
|Development Co., Ltd.||||||
||||||commerce, material|
||||||trading|

China Fangda Group Co., Ltd. 2014 Annual Report
|||
|-|-|
|Future development||
||The Company will continue investment.|
|strategy||
|Operating result,||
|financial status and cash|Banglin Technology's 2014 financial statements are not audited.|
|flow||
|Stock ownership of||
|other domestic and||
|overseas listed company||
||None|
|controlled or whose||
|shares are held by||
|controlling shareholders||

No change in the controlling shareholder in the report period
3. Substantial controller of the Company
Natural person
||||
|-|-|-|
|Name of substantial controller|Nationality|Right of residence in another country or region|
|Xiong Jianming|Chinese|Yes|
|Occupation and position over the last five|||
||Chair of the Board and president of the Company||
|years|||
|Profiles of domestic and overseas listed|||
||The controller held no share in other listed companies in the last ten years.||
|companies in which the controller held shares|||

No change in the actual shareholder in the report period
7. Chart of the controlling relationship
No controlling over the Company by the substantial controller through trust or other asset management
China Fangda Group Co., Ltd. 2014 Annual Report 4. The Company has no other legal person shareholders with over10% of total shares
4. Statement on share increasing proposal raised by the shareholders or their action-in-concert parties in the reporting period
||||||||
|-|-|-|-|-|-|-|
|||||||Disclosure date of|
|Name of|||||||
||Number of|Proportion of||Actual proportion|Initial disclosure|the share increase|
|shareholder/|||Actual number of||||
||shares to be|shares to be||of shares|date of the share|plan|
|action-in-concert|||shares increased||||
||increased|increased||increased|increase plan|implementation|
|parties|||||||
|||||||completion|
|Shengjiu Investment|||||||
||||11,199,085|1.48%|||
|Ltd.|||||||

China Fangda Group Co., Ltd. 2014 Annual Report VII Particulars about the Directors, Supervisors, Senior Management and Employees
1. Changes in shareholding of Directors, Supervisors and Senior Management
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
||||||||Number of||||
||||||||shares held|Increased|Decreased|Number of|
||||||Starting||||||
|||||||End date|at|shares in|shares in|shares held|
|Name|Position|Job status|Sex|Age|date of the||||||
|||||||of the term|beginning|this period|this period|at end of|
||||||term||||||
||||||||of the|(share)|(share)|the period|
||||||||period||||
|Xiong|Chairman,||||March 31,|March 31,|||||
|||In office|M|57|||1,002,771|0|0|1,002,771|
|Jianming|president||||2014|2017|||||
||Director,||||||||||
|Wang|||||March 31,|March 31,|||||
||vice|In office|M|57|||36,286|0|0|36,286|
|Shengguo|||||2014|2017|||||
||president||||||||||
|Xiong|||||March 31,|March 31,|||||
||Director|In office|M|46|||||||
|Jianwei|||||2014|2017|||||
||Director,||||||||||
|Zhou|secretary||||March 31,|March 31,|||||
|||In office|M|52|||||||
|Zhigang|of the||||2014|2017|||||
||Board||||||||||
|Huang|Independe||||March 31,|March 31,|||||
|||In office|M|52|||||||
|Yaying|nt director||||2014|2017|||||
|Guo|Independe||||March 31,|March 31,|||||
|||In office|M|49|||||||
|Wanda|nt director||||2014|2017|||||
||Independe||||March 31,|March 31,|||||
|Lin Bin||In office|M|52|||||||
||nt director||||2014|2017|||||
||Supervisor||||||||||
||y||||||||||
||||||March 31,|March 31,|||||
|Zhen Hua|Committee|In office|F|55|||||||
||||||2014|2017|||||
||meeting||||||||||
||convener||||||||||
|Yin|||||March 31,|March 31,|||||
||Supervisor|In office|M|46|||||||
|Changjian|||||2014|2017|||||
|Zen|||||March 31,|March 31,|||||
||Supervisor|In office|M|45|||||||
|Xiaowu|||||2014|2017|||||

China Fangda Group Co., Ltd. 2014 Annual Report
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
||Vice||||||||||
||||||March 31,|March 31,|||||
|Lin Kebin|president|In office|M|37|||||||
||||||2014|2017|||||
||and CFO||||||||||
|Wei|Vice||||March 31,|March 31,|||||
|||In office|M|46|||||||
|Yuexing|president||||2014|2017|||||
|Guo|Independe||||March 25,|March 25,|||||
|||Resigned|M|53|||||||
|Jinlong|nt director||||2011|2014|||||
|Shao|Independe||||March 25,|March 25,|||||
|||Resigned|F|76|||||||
|Hanqing|nt director||||2011|2014|||||
||||||March 25,|March 25,|||||
|Yu Guoan|Supervisor|Resigned|M|55|||||||
||||||2011|2014|||||
||||||March 25,|March 25,|||||
|Cao Naisi|Supervisor|Resigned|F|36|||||||
||||||2011|2014|||||
|Yang|Vice||||March 25,|March 25,|||||
|||Resigned|M|61|||||||
|Xioazhuan|president||||2011|2014|||||
|Total|--|--|--|--|--|--|1,039,057|0|0|1,039,057|

 2. Office Description
Working experiences of current directors, supervisors and senior management in recent five years
Mr. Xiong Jianming: PHD Management; senior engineer; part-time professor of Beijing Institute of Civil Engineering and Architecture and Nanchang University. He was once employed by Jiangxi Provincial
Machinery Design Academe, Administration Bureau of Shekou District of Shenzhen government, etc, deputy to the 10thPeople’s Congress of Guangdong Province, deputy to the
2nd
and
3rd
People’s Congress of Shenzhen City.He’s now assuming Chairman of the Board and President of the Company, member of the
5th
Shenzhen
Committee of CPPCC, standing member of the
5th
Nanshan Committee of CPPCC, founder and president of the Shenzhen Semiconductor Lighting Association, vice president of the Federation of Shenzhen Industries, vice president of the SGCC, president of the Nanshan Industry and Commerce Association and Honorary Chairman of Shenzhen Nanshan Charity Society.
Mr. Wang Shengguo: Master degree; Visiting Scholar from University of Essen, senior engineer. He once held such positions as Chief Engineer of Design Institute of the
2nd
Heavy Machinery factory of Machinery Industrial Ministry. Mr. Wang is now a Director and Vice President of the Company.
Mr. Xiong Jianwei: MBA. He is now a director of the Company.
Mr. Zhou Zhigang,bachelor’s degree. He is currently a Director, Secretary of Board, and head of the Securities Dept and HR Dept.
Mr. Huang Yaying, is a master of China University of Political Science and Law, a law professor and licensed lawyer. He is a senior visiting scholar of the Law School of UNSW and Hong Kong University. He is now the president of the Law School and a member of the Diploma Appraisal Committee of Shenzhen University, standing director of the China Academy of Arbitration Law and Institute of China Private International Law,
lawyer of the Guangdong Guoxin Law Firm and independent director of the Company.
Guo Wanda: Economic PH.D, research. As the executive deputy president of China Development Institute,
he has studied in macro-economy, industry policies and enterprise development strategies for years and provided
China Fangda Group Co., Ltd. 2014 Annual Report consulting services. He is an independent director of the Company.
Lin Bin: economics (accounting) doctor. He is a professor of the Accounting Department of the Management School of Sun Yat-Sen University, director of the Enterprise and Non-Profit Organization Research Center of Sun Yat-Sen University, and was once the director of the Accounting Department of Sun Yat-Sen University and MPACC Education Center. He is a member of the consultant panel of the enterprise internal control standard committee of the Ministry of Finance, deputy president of Guangdong Auditor Society, vice president of the Guangdong Internal Auditor Association.
Ms. Zhen Hua: Bachelor degree. She is now Supervisory Committee meeting convener, Chairwoman of Trade Union, Director of President Office and head of the administration department of the Company.
Yin Changjian, bachelor's degree, is a CPA. He was only deputy general manager of Beijing branch of Fangda Jianke and is now the deputy director of the audit and supervision dept. He is a staff supervisor.
Zeng Xiaowu, master's degree, is a senior engineer. He was once chief engineer, president of the design institution and is now the vide technical supervisor
Mr. Lin Kebin,bachelor’s degree. At presenthe’s the Vice President and CFO of the Company.
Wei Yuexing, bachelor's degree, is an engineer. He is now vice president of the Company and general manager of Fangda Jianke
Offices held at shareholders entities
|||||||
|-|-|-|-|-|-|
||||||Whether any|
||||Starting date of|End date of the|remuneration is paid|
|Name|Shareholder entity|Office||||
||||the term|term|at the shareholder|
||||||entity|
|Xiong|||October 6,|||
||Shengjiu Investment Ltd.|Chairman|||No|
|Jianming|||2011|||
|Wang|||October 19,|||
||Shenzhen Shilihe Investment Co., Ltd.|Chairman|||No|
|Shengguo|||2006|||
|Wang||General|September 29,|||
||Shenzhen Shilihe Investment Co., Ltd.||||No|
|Shengguo||manager|2003|||
|Xiong Jianwei|Shenzhen Shilihe Investment Co., Ltd.|Director|June 12, 2001||No|
||||October 19,|||
|Zhou Zhigang|Shenzhen Shilihe Investment Co., Ltd.|Director|||No|
||||2006|||
||||October 19,|||
|Zhen Hua|Shenzhen Shilihe Investment Co., Ltd.|Supervisor|||No|
||||2006|||
|Office||||||
||None|||||
|description||||||

Offices held at other entities
|||||||
|-|-|-|-|-|-|
||||||Whether any|
||||Starting date of|End date of the|remuneration is paid|
|Name|Entity name|Office||||
||||the term|term|at the shareholder|
||||||entity|
|Huang Yaying|Law School of Shenzhen University|Dean|July 1, 2009||Yes|

China Fangda Group Co., Ltd. 2014 Annual Report
|||||||
|-|-|-|-|-|-|
|Huang Yaying|Guangdong Guoxin Law Firm|Lawyer|May 1, 2009||No|
||Shenzhen Zhongzhuang Construction|Independent||||
|Huang Yaying|||May 1, 2013||Yes|
||Group Stock Co., Ltd.|director||||
|||Independent|October 1,|||
|Huang Yaying|Han's Laser Technology Co., Ltd.||||Yes|
|||director|2013|||
|||Independent|December 1,|||
|Huang Yaying|Shenzhen Airport Stock Co., Ltd.||||Yes|
|||director|2014|||
|||Standing||||
||General Development Research Institute|||||
|Guo Wanda||deputy|July 1, 2007||Yes|
||(China Shenzhen)|||||
|||president||||
||Shenzhen Baode Technology Group Stock|Independent||||
|Guo Wanda|||June 6, 2008||Yes|
||Co., Ltd.|director||||
||Shenzhen Meiyingseng Environmental|Independent|September 21,|September 22,||
|Guo Wanda|||||Yes|
||Protection Technology Co., Ltd.|director|2010|2016||
||Sun Yat-Sen University Management||October 1,|||
|Lin Bin||Professor|||Yes|
||Academy||1998|||
||Guangzhou Baiyun International Airport|Independent||||
|Lin Bin|||June 27, 2013|June 26, 2016|Yes|
||Co., Ltd.|director||||
|||Independent||||
|Lin Bin|Guangzhou Pearl River Beer Co., Ltd.||June 19, 2012||Yes|
|||director||||
|Office||||||
||The above-mentioned three are independent directors of the Company.|||||
|description||||||

3. Annual Remunerations of the Directors, Supervisors and Senior Executives
Decision making procedures, basis and actual payment of remunerations of the Directors, Supervisors and Senior Executives
1. Remuneration schemes for directors and supervisors are proposed by the Remuneration and Assessment Committee of the Board, and implemented upon approval of the Board and theShareholders’ Meetings; the remuneration schemes for executives are approved and implemented by the Board.
Remuneration for directors and supervisors are decided by theshareholders’ meeting. Remunerations for
executives are composed of wages and performance bonus as decided by the Board.
Payment on monthly basis
Remunerations of the Directors, Supervisors and Senior Executives of the Company During the reporting period In RMB10,000
|||||||||
|-|-|-|-|-|-|-|-|
|||||||Total|Unpaid|
||||||Total|remuneration|remuneration|
|Name|Position|Sex|Age|Job status||||
||||||remuneration|from the|during the|
|||||||shareholding|reporting|

China Fangda Group Co., Ltd. 2014 Annual Report
|||||||||
|-|-|-|-|-|-|-|-|
|||||||party|period|
|Xiong|Chairman,|||||||
|||M|57|In office|176.33|0|176.33|
|Jianming|president|||||||
|Wang|Director, vice|||||||
|||M|57|In office|90.92|0|90.92|
|Shengguo|president|||||||
|Xiong Jianwei|Director|M|46|In office|78.55|0|78.55|
||Director,|||||||
|Zhou Zhigang|secretary of the|M|52|In office|63.84|0|63.84|
||Board|||||||
||Independent|||||||
|Huang Yaying||M|52|In office|8|0|8|
||director|||||||
||Independent|||||||
|Guo Wanda||M|49|In office|6|0|6|
||director|||||||
||Independent|||||||
|Lin Bin||M|52|In office|6|0|6|
||director|||||||
||Supervisory|||||||
||Committee|||||||
|Zhen Hua||F|55|In office|53.9|0|53.9|
||meeting|||||||
||convener|||||||
|Yin Changjian|Supervisor|M|46|In office|31.54|0|31.54|
|Zen Xiaowu|Supervisor|M|45|In office|66.46|0|66.46|
||Vice president|||||||
|Lin Kebin||M|37|In office|78.76|0|78.76|
||and CFO|||||||
|Wei Yuexing|Vice president|M|46|In office|75.56|0|75.56|
||Independent|||||||
|Guo Jinlong||M|53|Resigned|2|0|2|
||director|||||||
||Independent|||||||
|Shao Hanqing||F|76|Resigned|2|0|2|
||director|||||||
|Cao Naisi|Supervisor|F|36|Resigned|41.61|0|41.61|
|Yu Guoan|Supervisor|M|55|Resigned|0.75|0|0.75|
|Yang||||||||
||Vice president|M|61|Resigned|43.75|0|43.75|
|Xioazhuan||||||||
|Total|--|--|--|--|825.97|0|825.97|

 Equity incentive programs provided for the Directors, Supervisors and Senior Executives of the Company during the reporting period
China Fangda Group Co., Ltd. 2014 Annual Report 4. Changes in the Directors, Supervisors and Senior Executives
||||||
|-|-|-|-|-|
|Name|Job|Type|Date|Reason|
|Xiong Jianming|Chairman, president|Elected|March 31, 2014|Expired|
|Wang Shengguo|Director, vice president|Elected|March 31, 2014|Expired|
|Xiong Jianwei|Director|Elected|March 31, 2014|Expired|
||Director, secretary of the||||
|Zhou Zhigang||Elected|March 31, 2014|Expired|
||Board||||
|Huang Yaying|Independent director|Elected|March 31, 2014|Expired|
|Guo Wanda|Independent director|Elected|March 31, 2014|Expired|
|Lin Bin|Independent director|Elected|March 31, 2014|Expired|
||Supervisory Committee||||
|Zhen Hua||Elected|March 31, 2014|Expired|
||meeting convener||||
|Yin Changjian|Supervisor|Elected|March 31, 2014|Expired|
|Zen Xiaowu|Supervisor|Elected|March 31, 2014|Expired|
|Lin Kebin|Vice president and CFO|Engaged|March 31, 2014|Expired|
|Wei Yuexing|Vice president|Engaged|March 31, 2014|Expired|
|Guo Jinlong|Independent director|Leaving office|March 31, 2014|Expired|
|Shao Hanqing|Independent director|Leaving office|March 31, 2014|Expired|
|Yu Guoan|Supervisor|Leaving office|March 31, 2014|Expired|
|Cao Naisi|Supervisor|Leaving office|March 31, 2014|Expired|
|Yang Xioazhuan|Vice president|Leaving office|March 31, 2014|Expired|

5. Core technical team or personnel have remained unchanged in the report period.
6. Employees
||||||
|-|-|-|-|-|
|Employees (by December 31, 2014)|||||
||Fangda Group (parent)|Fangda Jianke(main subsidiary)|Othersubsidiaries|Total|
|Number of employeesin position|72|1,588|1359|3,019|
|Retired employees onthe Company’s expense|0|0|0|0|
|Categories ofprofessions|Fangda Group (parent)|Fangda Jianke(main subsidiary)|Othersubsidiaries|Total|
|Production|0|552|824|1376|
|Sales & Marketing|0|63|99|162|

China Fangda Group Co., Ltd. 2014 Annual Report
||||||
|-|-|-|-|-|
|Technicians|0|258|137|395|
|Finance & Accounting|8|42|28|78|
|Executive|64|673|271|1008|
|Categories of education|Fangda Group (parent)|Fangda Jianke(main subsidiary)|Othersubsidiaries|Total|
|High school or below|22|677|1040|1739|
|College diploma|9|299|146|454|
|Bachelor|32|597|164|793|
|Master’s degree|8|14|9|31|
|Doctor’s degree|1|1|0|2|

Staff remuneration policy: TheCompany’s staff remuneration comprises post wage, performance wage, allowance
China Fangda Group Co., Ltd. 2014 Annual Report and annual bonus. The Company has set up an economic responsibility assessment system according to the annual operation target and responsibility indicators for all departments. The performance wage is determined by the economic indicators, management indicators, optimization indicators and internal control. The annual bonus is determined by the Company's annual profit and fulfillment of targets set for various departments. The staff remuneration and welfare will be adjusted according to theCompany’s business operation and changes in the local standard of living and price index.
Staff training plan: The Company has paid continuous attention to training and development of the staff and introduces innovative learning as part of the long-term strategy. We provide training programs through different channels and in different fields for different employees will help them fulfill their works, including new staff training, on-the-job training, operation and management training programs. These programs have largely elevated capabilities of the staff and underpin the success of the Company.
In the report period, the total of outsourced labor services amounted to 8.56 million hours, with a total income of RMB256.69 million.
China Fangda Group Co., Ltd. 2014 Annual Report VIII Corporation Governance
1. Overview
During the report period, the Company strictly complied with the Company Law, Securities Law,
Governance Standards for Listed Companies, Shenzhen Stock Exchange Share Listing Rules, Operation
Regulations for Listed Companies in the Main Board of Shenzhen Stock Exchange, continued to improve the legal person governance structure and has formulated a series of internal management systems covering various aspects. The Company has set up a comprehensive and effective internal control system in important decision making, related transaction decision making, financial management, HR management, administration, purchase, production and sales management, confidentiality and information disclosure.
By the end of the reporting period, the corporate governance complies with the Chinese laws and
requirements regarding corporate governance of listed companies issued by CSRC. The corporate governance complies with the Company Law and related requirements of CSRC.
Implementation of corporate governance activities and establishment and implementation of insider registration and management system
1. Revision of corporate governance
(1) According to the Company Law (2014 Revised), Guidelines for Articles of Association for Listed Companies (2014 Revised), the Company revised the Articles of Associations,Shareholders’ Meeting Criteria, Working Regulations of the Board of Directors and Regulations on External Investment, which were approved at the
2nd
extraordinaryshareholders’ meeting in 2014 and
1st
extraordinaryshareholders’ meeting in 2015. The announcements were published on China Securities Journal, Shanghai Securities Daily, Securities Times, HKCD and www.cninfo.com.cn on September 12, 2014 and January 14, 2015.
(2) To regulate cash dividend distribution and improve distribution transparency, according to CSRC[2013] No.43 Cash Dividend of Listed Companies, the Company revised profit distribution policies and terms in the Articles of Associations and formulated the Shareholder Return Plan for 2015-2017, which were approved at the 8th
meeting of the
7th
Board of Directors and
1st
extraordinaryshareholders’ meeting in 2015.
2. Implementing cash dividend distribution plan
Approved at the Shareholders' Meeting 2013 held on March 31, 2014, the Company's profit distribution plan for 2013 is distributing a cash dividend of RMB0.30 (tax-included) for every ten shares of all the shareholders based on a total of 756,909,905 shares on December 31, 2013. The 2013 Share Equity Distribution
Implementation Announcement was published on China Securities Journal, Shanghai Securities Daily, Securities Times, HKCD and www.cninfo.com.cn on April 8, 2014. 3. Establishing and implementing insider registration management system
The Company has revised the “Information Insider Registration Scheme” according to the requirement of CSRC in February 2012. The revised Information Insider Registration Scheme is published on
www.cninfo.com.cn.
No situation was found in the report period that any of the insiders had been trading theCompany’s shares taking advantages of the material information they could get access to, neither informed by the supervisory
China Fangda Group Co., Ltd. 2014 Annual Report authorities regarding inspection or correction notice.
2. Annual and extraordinary shareholder meetings held during the report period
1. Annual shareholder meeting during the report period
|||||||
|-|-|-|-|-|-|
||||Resoluti|Date of|Index for information|
|Meeting|Date|Proposal||||
||||on|disclosure|disclosure|
|||(1) Review The Board of Directors’ Work Report||||
|||2013; (2) review the Supervisory Committee’s Work||||
|||Report 2013; (3) review the Annual Report 2013 and||||
|||the Summary; (4) review the Financial Settlement||||
||||||The announcement of|
|||Report 2013; (5) review the proposal of dividend||||
||||||The Resolutions of|
|||distribution for year 2013; (6) review the proposal||||
||||||Shareholders’ Annual|
|||about applying for integrated bank credit; (special|All the|||
||||||Meeting 2013 was|
|2013 Annual||resolution); (7) review the proposal of providing|proposal|||
||March 31,|||April 1,|published on China|
|Shareholder||guarantee for the company’s fully-owned subsidiary;|s are|||
||2014|||2014|Securities Journal,|
|Meeting||(special resolution); (8) review the proposal of|approve|||
||||||Shanghai Securities|
|||engaging the auditor for 2014; (9) review the|d|||
||||||Daily, Securities|
|||remuneration plan for the 7th Board of Directors||||
||||||Times, HKCD and|
|||(including independent directors) and supervisory||||
||||||www.cninfo.com.cn|
|||committee; (10) review the proposal of re-electing the||||
|||Board of Directors of the Company; (11) review the||||
|||proposal of re-electing the Supervisory Committee of||||
|||the Company||||

2. Extraordinary shareholder meetings during the report period
|||||||
|-|-|-|-|-|-|
||||Resoluti|Date of|Index for information|
|Meeting|Date|Proposal||||
||||on|disclosure|disclosure|
|||1. Proposal on providing guarantee for the Company’s|||The announcement of 1st|
|1st||fully-owned subsidiaries.(special resolution) 2. The|All the||Provisional Shareholders’|
|Provisional||proposal of approving Shenzhen Fangda Property|proposal||Meeting 2014 was published|
||January|||January||
|Shareholder||Development Co., Ltd.’s application for integrated|s are||on China Securities Journal,|
||24, 2014|||25, 2014||
|s’ Meeting||bank credit and providing of guarantee. (Special|approve||Shanghai Securities Daily,|
|2014||resolution) 3. Proposal of Investment in Fangda Town|d||Securities Times, HKCD and|
|||renovation project.|||www.cninfo.com.cn.|
|||1. The proposal about applying for integrated bank|||The announcement of 2nd|
|2nd|||All the|||
|||credit; (special resolution) 2. The proposal of|||Provisional Shareholders’|
|Provisional|||proposal|||
||September|providing guarantee for controlled company; (special||September|Meeting 2014 was published|
|Shareholder|||s are|||
||11, 2014|resolution) 3. The proposal on revising the Articles of||12, 2014|on China Securities Journal,|
|s’ Meeting|||approve|||
|||Association (special resolution); 4. The proposal of|||Shanghai Securities Daily,|
|2014|||d|||
|||Revising Shareholders' Meeting Criteria 5. The|||Securities Times, HKCD and|

China Fangda Group Co., Ltd. 2014 Annual Report
|||
|-|-|
|proposal of Revising Working Regulations of the|www.cninfo.com.cn.|
|Board of Directors.||

3. No shareholder of preferred shares with recovered votes convened extraordinaryshareholders‟ meeting 3. Performance of independent directors during the report period
1. Independentdirectors‟ presenting of board meetings andshareholders‟ meetings in the report period
||||||||
|-|-|-|-|-|-|-|
|Independent directors’ presenting of board meetings|||||||
||Time of board|||||Absent for two|
|Name of independent||Presented|Presented by|Presented by|||
||meetings should||||Absent|consecutive|
|director||personally|telecom|proxy|||
||have attended|||||meetings|
|Huang Yaying|12|9|3|0|0|No|
|Guo Wanda|8|4|2|2|0|No|
|Lin Bin|8|5|2|1|0|No|
|Shao Hanqing|4|2|1|1|0|No|
|Guo Jinlong|4|2|1|1|0|No|
|Time of presence by independent|||||||
|||5|||||
|directors at shareholders’ meetings|||||||

No independent director was absent from two consecutive meetings of the Board of Director in the report period. 2. Independent directors made no objection on related issued of the Company in the report period.
3. Other statement for performance of independent directors
Adoption of suggestion proposed by independent directors
√ Yes□ No
Statement for suggestion adopted or not by the Company
(1) During the report period, theCompany’s independent directors have paid attention to theCompany’s operation and performed their duties independent in accordance with applicable laws, regulations and Articles of Association of the Company and have proposed many professional suggestions for improving theCompany’s system and routine operation decision-making. During the report period, independent directors have made independent and just opinion on issues that need independentdirectors’ opinions, playing positive roles in improving theCompany’s supervisory system and protecting the rights and interests of the Company and
shareholders.
(2) Independent opinions issued in 2014
||||||
|-|-|-|-|-|
|Name|Time of independentopinion|Issue involved|Type ofindependentopinion|Disclosure ofthe independentopinion|
|Shao|March 7, 2014|Use of the Company’s fund by controlling shareholder|In favor|Yes|

China Fangda Group Co., Ltd. 2014 Annual Report
||||
|-|-|-|
|HanqingGuoJinlongHuangYaying||and other affiliates and guarantee made by the Company|
|||Internal control self evaluation report|
|||Independent opinion on the profit distribution plan for2013|
|||Independent opinion of engaging the auditor for 2014|
|||Independent opinion on remuneration of directors andsenior executives in 2013|
|||Announcement on Using Self-Owned Idle Fund forSecurities Investment|
|||Independent opinions on re-election of the Board ofDirectors and annual remuneration for directors andsupervisors|
|HuangYaying,GuoWanda, LinBin|March 31, 2014|Independent opinions on employing senior management|
||August 21, 2014|Use of fund and external guarantees made controllingshareholder and other affiliates in the first half of 2014|
||December 23, 2014|Independent opinions on private share issuance|
|||Independent opinions on Related Transactions of PrivateShare Issuance.|
|||Opinions on the utilization report of previously raisedcapital|
|||Opinions on revising the Articles of Association ofChina Fangda Group Co., Ltd.|
|||Independent opinions on the Shareholders’ RewardingPlan for the next three years|

4. Performance of specific committees under the Board
(1) Performance of the Development Strategy Committee
During the report period, the Development Strategy Committee of the Company has performed its duties in accordance with the Working Regulations for Development Strategy Committee and played its role in the decision-making process of the Company. Two meetings were convened and details are disclosed as follows: 1. On March 7, 2014, the Company held the
6th
meeting of the 6th Development Strategy Commission to listen to the report on production and operation and production and operation plan for 2013 and 2014.
2. On August 22, 2014, the
1st
meeting of the Development Strategy Committee of the
7th
term of the Board was held to view theCompany’s production and operation in the first half of 2014 and studied the fulfillment of the business plan in the first half of the year and places to be improved in the second half.
(2) Performance of the Auditing Committee
During the report period, five Auditing Committee meetings are held to review issues including the
arrangement of audit, regular financial reports, engaging the CFA, and use of the fund raised. Details of the meetings are disclosed as follows:
1. On March 3, 2014, the
15th
meeting of the Auditing Committee of the
6th
term of the Board was held to
review the financial statements with the initial opinion issued by the CFA for 2013 and approved the auditor
report issued by the CFA. After the CFA issued to finalauditor’s opinion, the Auditing Committee submitted the
China Fangda Group Co., Ltd. 2014 Annual Report resolution on the annual financial statements to the Board and issued the summary report on the auditing of the CFA for this year.
5. Performance of Supervisory Committee
Risks for the Company discovered by the Supervisory Committee
□ Yes√ No
No disagreement with supervisory issues by the Supervisory Committee during the report period.
6. Independence of the Company from the controlling shareholder in aspects of businesses, personnel, assets, organizations, and accounting
The Company is completely separated from the controlling shareholder in aspects of businesses, personnel, assets, organizations and accounting. The Company has its own completed businesses and capacity of independent business operation.
In the aspect of business: the Company has its own purchasing, production, sales, and customer service system which performing independently. There is not any material related transactions occurred with the controlling shareholders.
In personnel: The labor management, personnel and salary management are operated independently from the controlling shareholder. The senior managements take salaries from the Company and none of them takes senior management position in the controlling party.
In assets: The Company owns its production, supplementary production system and accessory equipments independently, and possesses its own industrial properties, non-patent technologies, and trademark.
In organization: The production and business operation, executive management, and department setting are completely independent from the controlling shareholder. No situation of combined office exists. The Company adjusts its organizing structure only for its own practical requirement of development and management.
In accounting: The company has its own independent accounting and auditing division, established
independent and completed accounting system and management rules, has its own bank account, and exercise its liability of taxation independently.
7. No horizontal competition
8. Assessment and motivation of senior executives
The Company has implemented a remuneration system that combines post wage and performance bonus. The wages and bonus are determined by on the assessment of seniorexecutives’ innovation capabilities, general quality, performance, fulfillment of profit and payment collection targets in the Implementation Regulations for 2014 Supervisory and Management Department Target Management and Assessment and Implementation Regulations for 2014 Subordinate Unit Assessment.
China Fangda Group Co., Ltd. 2014 Annual Report IX Internal Control
1. Internal Control Construction
In 2014, the Company has established a solid internal control system and examine key control activities in accordance with the Enterprise Internal Control Regulations and Guidelines and Internal Control Evaluation Guide issued by the Ministry of Finance. Moreover, the Company has urged subsidiaries and branches to establish and improve the internal control system. The Company has inspected the internal control on business
management, capital management, assets management, investment management, information management and HR management and make correction on key internal control points to ensure implementation of the internal control system. Moreover, the Company has accelerated establishment and improvement of internal control system among its subsidiaries and branches to formulate relate documents. In the report period, the Company has established internal control system to cover related business and affairs. The existing system is complete, reasonable and effective with enforceable documents, which will help the Company prevent risks in decision making and management.
2.Board‟s statement on internal control responsibility
The Company has established a comprehensive and effective internal control system and reviews its
effectiveness. It is the responsibility of the Board of Directors to disclose the internal control evaluation report. 3. Basis for establishment of the internal financial statement control
The financial report internal control system is built based on the Company Law, Enterprise Accounting Principles, Operation Regulations for Listed Companies in the Main Board of Shenzhen Stock Exchange and Basic Regulations on Enterprise Internal Control and other applicable laws and regulations.
4. Internal control valuation report
|||
|-|-|
|Major internal control defects discovered in the report period in the internal control evaluation report||
|No major defect is found in the report period||
|Date of disclosure of the internal||
||March 27, 2015|
|control evaluation report||
|Disclosure of the internal control||
||The 2014 Internal Control Evaluation Report will be disclosed on www.cninfo.com.cn.|
|evaluation report||

5. Internal Control Audit or Verification Report
||
|-|
|Comments in the internal control audit report|
|We believe that China Fangda Group has maintained effective internal control on financial reports according to Basic Regulations|

China Fangda Group Co., Ltd. 2014 Annual Report
|||
|-|-|
|on Enterprise Internal Control and related regulations on December 31, 2014.||
|Date of disclosure of the internal||
||March 27, 2015|
|control audit report||
|Source of disclosure of the internal||
||The 2014 Internal Control Audit Report will be disclosed on www.cninfo.com.cn.|
|control audit report||

Non-standard internal control audit report by the CFA
Consistency between the internal control audit report and self-evaluation report
6. Establishment and implementation of the Retrospective Rules of Material False Information in Annual Report
The Company has adopted the Retrospective Rules of Material False Information in Annual Report. It will contribute to recognize and process material false in the procedures. The Company has been implementing the regulations diligently and no such material false or omission was found in the report period.
China Fangda Group Co., Ltd. 2014 Annual Report X Financial Statements
1.Auditor„s report
|||
|-|-|
|Type|Standard opinion auditor’s report|
|Issued on|March 25, 2015|
|Auditor|Grant Thornton (special general partner)|
|Report No.|致同审字（2015）第350ZA0071号|
|CPA names|Lin Kaiqin and Li Chunmei|

Auditors‟ report
致同审字（2015）第350ZA0071号 To the shareholders of China Fangda Group Co., Ltd.:
We have audited the Financial Statements of China Fangda Group Co., Ltd. (“Fangda Group”) attached hereafter, including the Balance Sheet and Consolidated Balance Sheet ended December 31, 2014 and the Income Statement, Consolidated Income Statement, Cash Flow Statement, Consolidated Cash Flow Statement, Statement on Change ofShareholders’ Equity, Consolidated Statement on Change ofShareholders’ Equity of the year 2014, as well as the Notes to the Financial Statements.
1.Executives‟ responsibilities on the Financial Statements
Preparing of the Financial Statements according to Enterprise Accounting Standard is the responsibility of the management of the Company. This responsibility includes: (1) to prepare the financial statements according to the accounting standard, and ensure its fair reflection of business position; (2) to design, implement and maintain the internal control system related to producing of the Financial Statements, to prevent the Financial Statements from major false presentation due to cheating or error.
2. Responsibilities of the CPA
Our responsibility is to express an auditing opinion on the financial statements basing on our audit. We carried out the auditing works with compliance to Chinese CPA Auditing Standard, which requires us to plan and implement our works on the basis of professional ethic standards, and obtain reasonable guarantee that the Financial Statements are free of major false statements.
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, we consider the internal control relevant to theentity’s preparation of financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting polices used and the reasonableness of the accounting estimates made by
management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
China Fangda Group Co., Ltd. 2014 Annual Report audit opinion.
3.Auditors‟ Opinions
We believe that Fangda Group has been following with the Enterprise Accounting Standard in preparing of the Financial Statements. The Financial Statements is reflecting, in all important aspects, the financial situation of Fangda Group as of December 31, 2014, and the business performance and cash flow of year 2014.
Grand Thornton CPA CPA China Lin Kaiqin
(limited liability partnership)
CPA China Li Chunmei
Beijing, China March 25, 2015
2. Financial statements
Unit for statements in notes to financial statements: RMB yuan
1. Consolidated Balance Sheet
Prepared by: China Fangda Group Co., Ltd.
In RMB
||||
|-|-|-|
|Items|Closing balance|Ending balance|
|Current asset:|||
|Monetary capital|212,430,798.87|333,876,921.97|
|Settlement provision|||
|Outgoing call loan|||
|Financial assets measured at fair|||
|value with variations accounted into|13,410,790.00||
|current income account|||
|Derivative financial assets|||
|Notes receivable|83,325,725.70|21,898,770.43|
|Account receivable|1,105,242,251.46|898,780,981.93|
|Prepayment|29,234,231.49|28,364,016.21|

China Fangda Group Co., Ltd. 2014 Annual Report
||||
|-|-|-|
|Insurance receivable|||
|Reinsurance receivable|||
|Provisions of Reinsurance|||
|contracts receivable|||
|Interest receivable||36,387.50|
|Dividend receivable|||
|Other receivables at the end of|||
||48,950,647.67|66,298,730.17|
|the period|||
|Repurchasing of financial assets|||
|Inventory|982,441,187.05|428,537,851.82|
|Assets held for sales|||
|Non-current assets due in 1 year|||
|Other current assets|234,986,107.72||
|Total current assets|2,710,021,739.96|1,777,793,660.03|
|Non-current assets:|||
|Disburse of loans|||
|Sellable financial assets|||
|Investment held until mature|||
|Long-term receivable|||
|Long-term share equity|||
||11,048,660.43|9,994,565.55|
|investment|||
|Investment real estate|226,279,523.39|195,249,069.13|
|Fixed assets|489,714,684.63|462,930,269.98|
|Construction in process|341,749.17|940,841.00|
|Engineering materials|||
|Disposal of fixed assets|26,918.21|177,298.11|
|Productive biological assets|||
|Gas & petrol|||
|Intangible assets|98,947,331.09|91,527,650.52|
|R&D expense|||
|Goodwill|26,279,395.89||
|Long-term amortizable expenses|4,119,362.63|3,799,354.79|
|Deferred income tax assets|52,616,656.38|41,166,043.56|
|Other non-current assets|43,323,878.63|15,978,789.90|
|Total of non-current assets|952,698,160.45|821,763,882.54|

China Fangda Group Co., Ltd. 2014 Annual Report
||||
|-|-|-|
|Total of assets|3,662,719,900.41|2,599,557,542.57|
|Current liabilities|||
|Short-term loans|1,100,000,000.00|369,000,000.00|
|Loans from Central Bank|||
|Deposit received and held for|||
|others|||
|Call loan received|||
|Financial liabilities measured at|||
|fair value with variations accounted into|||
|current income account|||
|Derivative financial liabilities|||
|Notes payable|227,266,485.57|188,570,850.63|
|Account payable|685,108,346.73|489,216,140.32|
|Prepayment received|122,285,231.14|168,386,251.94|
|Selling of repurchased financial|||
|assets|||
|Fees and commissions payable|||
|Employees’ wage payable|41,703,314.26|30,182,851.80|
|Taxes payable|58,696,926.25|44,839,947.77|
|Interest payable|2,055,911.11|689,153.75|
|Dividend payable|||
|Other payables|47,425,682.44|41,687,580.72|
|Reinsurance fee payable|||
|Insurance contract provision|||
|Entrusted trading of securities|||
|Entrusted selling of securities|||
|Liabilities held for sales|||
|Non-current liabilities due in 1|||
||6,000,000.00||
|year|||
|Other current liabilities|||
|Total current liabilities|2,290,541,897.50|1,332,572,776.93|
|Non-current liabilities:|||
|Long-term loans|||
|Bond payable|||
|Including: preferred share|||

China Fangda Group Co., Ltd. 2014 Annual Report
||||
|-|-|-|
|Perpetual capital|||
|securities|||
|Long-term payable|6,000,000.00||
|Employees’ wage payable|||
|Special payables|||
|Anticipated liabilities|5,859,045.98||
|Deferred earning|10,049,892.04|10,255,823.93|
|Deferred income tax liabilities|49,734,436.90|40,656,763.97|
|Other non-current liabilities|||
|Total of non-current liabilities|71,643,374.92|50,912,587.90|
|Total liabilities|2,362,185,272.42|1,383,485,364.83|
|Owner’s equity:|||
|Share capital|756,909,905.00|756,909,905.00|
|Other interest tools|||
|Including: preferred share|||
|Perpetual capital|||
|securities|||
|Capital reserves|79,099,220.38|79,099,220.38|
|Less: Shares in stock|||
|Other miscellaneous income|91,831.63|91,831.63|
|Special reserves|||
|Surplus reserves|48,842,080.76|46,389,142.21|
|Common risk provisions|||
|Retained profit|349,987,825.69|278,149,631.63|
|Total of owner’s equity belong to the|||
||1,234,930,863.46|1,160,639,730.85|
|parent company|||
|Minor shareholders’ equity|65,603,764.53|55,432,446.89|
|Total of owners’ equity|1,300,534,627.99|1,216,072,177.74|
|Total liabilities and shareholders’ equity|3,662,719,900.41|2,599,557,542.57|

 Legal representative: Xiong Jianming CFO: Lin Kebing Accounting Manager: Chen Yonggang 2. Balance Sheet of the Parent Company
In RMB
||||
|-|-|-|
|Items|Closing balance|Ending balance|

China Fangda Group Co., Ltd. 2014 Annual Report
||||
|-|-|-|
|Current asset:|||
|Monetary capital|22,256,065.49|68,223,808.76|
|Financial assets measured at fair|||
|value with variations accounted into|||
|current income account|||
|Derivative financial assets|||
|Notes receivable|||
|Account receivable|511,660.60|604,459.49|
|Prepayment|50,903.86|218,984.07|
|Interest receivable|||
|Dividend receivable|28,639,627.17|39,356,000.00|
|Other receivables at the end of|||
||254,604,163.79|571,620,659.73|
|the period|||
|Inventory|||
|Assets held for sales|||
|Non-current assets due in 1 year|||
|Other current assets|31,005,620.01||
|Total current assets|337,068,040.92|680,023,912.05|
|Non-current assets:|||
|Sellable financial assets|||
|Investment held until mature|||
|Long-term receivable|||
|Long-term share equity|||
||1,130,674,559.01|719,728,311.13|
|investment|||
|Investment real estate|198,513,586.15|174,778,756.62|
|Fixed assets|60,145,112.89|48,117,849.19|
|Construction in process||914,126.00|
|Engineering materials|||
|Disposal of fixed assets|||
|Productive biological assets|||
|Gas & petrol|||
|Intangible assets|2,256,575.64|1,351,845.98|
|R&D expense|||
|Goodwill|||
|Long-term amortizable expenses|81,367.47|50,314.43|

China Fangda Group Co., Ltd. 2014 Annual Report
||||
|-|-|-|
|Deferred income tax assets|22,623,560.72|12,342,430.37|
|Other non-current assets|220,000,000.00||
|Total of non-current assets|1,634,294,761.88|957,283,633.72|
|Total of assets|1,971,362,802.80|1,637,307,545.77|
|Current liabilities|||
|Short-term loans|350,000,000.00|104,000,000.00|
|Financial liabilities measured at|||
|fair value with variations accounted into|||
|current income account|||
|Derivative financial liabilities|||
|Notes payable|||
|Account payable|606,941.85|1,849,090.36|
|Prepayment received|832,772.45|798,586.70|
|Employees’ wage payable|1,956,875.76|1,881,681.86|
|Taxes payable|567,424.56|260,761.30|
|Interest payable|659,266.67|193,930.00|
|Dividend payable|||
|Other payables|270,281,330.40|192,765,065.68|
|Liabilities held for sales|||
|Non-current liabilities due in 1|||
|year|||
|Other current liabilities|||
|Total current liabilities|624,904,611.69|301,749,115.90|
|Non-current liabilities:|||
|Long-term loans|||
|Bond payable|||
|Including: preferred share|||
|Perpetual capital|||
|securities|||
|Long-term payable|||
|Employees’ wage payable|||
|Special payables|||
|Anticipated liabilities|||
|Deferred earning|||
|Deferred income tax liabilities|97,693,047.19|88,615,374.26|

China Fangda Group Co., Ltd. 2014 Annual Report
||||
|-|-|-|
|Other non-current liabilities|||
|Total of non-current liabilities|97,693,047.19|88,615,374.26|
|Total liabilities|722,597,658.88|390,364,490.16|
|Owner’s equity:|||
|Share capital|756,909,905.00|756,909,905.00|
|Other interest tools|||
|Including: preferred share|||
|Perpetual capitalsecurities|||
|Capital reserves|38,598,565.00|38,598,565.00|
|Less: Shares in stock|||
|Other miscellaneous income|91,831.63|91,831.63|
|Special reserves|||
|Surplus reserves|48,842,080.76|46,389,142.21|
|Retained profit|404,322,761.53|404,953,611.77|
|Total of owners’ equity|1,248,765,143.92|1,246,943,055.61|
|Total liabilities and shareholders’ equity|1,971,362,802.80|1,637,307,545.77|

 3. Consolidated Income Statement
In RMB
||||
|-|-|-|
|Items|Amount occurred in the current period|Occurred in previous period|
|1. Total revenue|1,938,324,435.51|1,747,620,845.74|
|Incl. Business income|1,938,324,435.51|1,747,620,845.74|
|Interest income|||
|Insurance fee earned|||
|Fee and commission|||
|received|||
|2. Total business cost|1,867,564,531.44|1,670,170,512.18|
|Incl. Business cost|1,590,836,786.02|1,425,369,204.42|
|Interest expense|||
|Fee and commission paid|||
|Insurance discharge|||
|payment|||
|Net claim amount paid|||
|Net insurance policy|||

China Fangda Group Co., Ltd. 2014 Annual Report
||||
|-|-|-|
|reserves provided|||
|Insurance policy dividend|||
|paid|||
|Reinsurance expenses|||
|Business tax and surcharge|22,855,639.99|23,272,313.84|
|Sales expense|44,684,306.70|37,383,041.60|
|Administrative expense|152,584,713.60|127,254,247.26|
|Financial expenses|29,165,058.80|23,108,586.39|
|Asset impairment loss|27,438,026.33|33,783,118.67|
|Plus: gains from change of fair|||
||32,044,747.10|16,647,859.74|
|value (“-“ for loss)|||
|Investment gains (“-“ for loss)|1,720,693.98|300,866.92|
|Incl. Investment gains from|||
||1,054,094.88|-5,434.45|
|affiliates and joint ventures|||
|Exchange gains (“-“ for loss)|||
|3. Operational profit (“-“ for loss)|104,525,345.15|94,399,060.22|
|Plus: non-operational income|16,281,459.18|7,595,856.24|
|Including: Gain/loss of|||
||3,162,999.40|154,552.62|
|non-current assets|||
|Less: non-operational expenditure|10,623,712.10|1,344,375.30|
|Incl. Loss from disposal of|||
||1,709,152.13|617,106.70|
|non-current assets|||
|4. Gross profit (“-“ for loss)|110,183,092.23|100,650,541.16|
|Less: Income tax expenses|17,493,747.57|19,249,761.60|
|5. Net profit (“-“ for net loss)|92,689,344.66|81,400,779.56|
|Net profit attributable to the|||
||96,998,429.76|85,676,863.78|
|owners of parent company|||
|Minor shareholders’ equity|-4,309,085.10|-4,276,084.22|
|6. After-tax net of other miscellaneous|||
|||-1,108,815.63|
|income|||
|After-tax net of other miscellaneous|||
|||-1,108,815.63|
|income attributed to parent owner|||
|(1) Other comprehensive gain|||
|cannot be classified into gain/loss|||
|1. Changes in net liabilities|||
|or net assets of re-measured defined|||
|benefit program|||

China Fangda Group Co., Ltd. 2014 Annual Report
||||
|-|-|-|
|2. Share enjoyed in other|||
|miscellaneous income cannot be|||
|classified into gain/loss under the equity|||
|method|||
|(2) Other comprehensive gain that|||
|||-1,108,815.63|
|will be classified into gain/loss|||
|1. Share enjoyed in other|||
|miscellaneous income that will be|||
|classified into gain/loss under the equity|||
|method|||
|2. Gain/loss caused by|||
|changes in the fair value of financial asset|||
|for sales|||
|3 Gain/loss caused by|||
|reclassification of held-to-maturity|||
|investment to financial asset for sales|||
|4. Effective part of cash flow|||
|hedging gain/loss|||
|(5) Translation difference of|||
|foreign exchange statement|||
|6. Others||-1,108,815.63|
|After-tax net of other miscellaneous|||
|income attributed to minority|||
|shareholders|||
|7. Total of misc. incomes|92,689,344.66|80,291,963.93|
|Total of misc. incomes attributable|||
||96,998,429.76|84,568,048.15|
|to the owners of the parent company|||
|Total misc gains attributable to the|||
||-4,309,085.10|-4,276,084.22|
|minor shareholders|||
|8. Earnings per share:|||
|(1) Basic earnings per share|0.13|0.11|
|(2) Diluted earnings per share|0.13|0.11|

 Legal representative: Xiong Jianming CFO: Lin Kebing Accounting Manager: Chen Yonggang
4. Income Statement of the Parent Company
In RMB
||||
|-|-|-|
|Items|Amount occurred in the current period|Occurred in previous period|

China Fangda Group Co., Ltd. 2014 Annual Report
||||
|-|-|-|
|1. Turnover|29,609,371.13|45,659,921.07|
|Less: Operation cost|5,669,281.13|10,980,932.52|
|Business tax and surcharge|2,420,213.38|3,415,837.54|
|Sales expense|||
|Administrative expense|24,285,538.55|22,773,847.97|
|Financial expenses|13,398,214.90|10,054,285.40|
|Asset impairment loss|27,045,993.77|-3,228,252.95|
|Plus: gains from change of fair|||
||34,897,632.10|16,647,859.74|
|value (“-“ for loss)|||
|Investment gains (“-“ for|||
||29,805,392.25|-5,434.45|
|loss)|||
|Incl. Investment gains from|||
||1,054,094.88|-5,434.45|
|affiliates and joint ventures|||
|2. Operational profit (“-“ for loss)|21,493,153.75|18,305,695.88|
|Plus: non-operational income|2,441,486.71|193,478,232.51|
|Incl. Gain from disposal of|||
||22,719.41|4,918.81|
|non-current assets|||
|Less: non-operational expenditure|608,712.42|442,064.12|
|Incl. Loss from disposal of|||
||207,212.42|37,992.07|
|non-current assets|||
|3. Gross profit (“-“ for loss)|23,325,928.04|211,341,864.27|
|Less: Income tax expenses|-1,203,457.42|52,395,871.61|
|4. Net profit (“-“ for net loss)|24,529,385.46|158,945,992.66|
|5. After-tax net of other miscellaneous|||
|||-1,108,815.63|
|income|||
|(1) Other comprehensive gain|||
|cannot be classified into gain/loss|||
|1. Changes in net liabilities|||
|or net assets of re-measured defined|||
|benefit program|||
|2. Share enjoyed in other|||
|miscellaneous income cannot be|||
|classified into gain/loss under the equity|||
|method|||
|(2) Other comprehensive gain that|||
|||-1,108,815.63|
|will be classified into gain/loss|||
|1. Share enjoyed in other|||

China Fangda Group Co., Ltd. 2014 Annual Report
||||
|-|-|-|
|miscellaneous income that will be|||
|classified into gain/loss under the equity|||
|method|||
|2. Gain/loss caused by|||
|changes in the fair value of financial|||
|asset for sale|||
|(3) Gain/loss caused by|||
|reclassification of held-to-maturity|||
|investment to financial asset for sales|||
|(4) Effective part of cash|||
|flow hedging gain/loss|||
|(5) Translation difference|||
|of foreign exchange statement|||
|6. Others||-1,108,815.63|
|(6) Total of misc. incomes|24,529,385.46|157,837,177.03|
|(7) Earnings per share:|||
|(1) Basic earnings per share|||
|(2) Diluted earnings per share|||

5. Consolidated Cash Flow Statement
In RMB
||||
|-|-|-|
|Items|Amount occurred in the current period|Occurred in previous period|
|1. Net cash flow from business|||
|operations:|||
|Cash received from sales of|||
||1,651,025,342.09|1,763,447,209.35|
|products and providing of services|||
|Net increase of customer deposits|||
|and capital kept for brother company|||
|Net increase of loans from central|||
|bank|||
|Net increase of inter-bank loans|||
|from other financial bodies|||
|Cash received against original|||
|insurance contract|||
|Net cash received from|||
|reinsurance business|||
|Net increase of client deposit and|||
|investment|||

China Fangda Group Co., Ltd. 2014 Annual Report
||||
|-|-|-|
|Net increase in financial assets|||
|measured at fair value with variations|||
|accounted into current income account|||
|Cash received as interest,|||
|processing fee, and commission|||
|Net increase of inter-bank fund|||
|received|||
|Net increase of repurchasing|||
|business|||
|Tax refunded|1,735,709.16|1,935,388.44|
|Other cash received from|||
||31,286,645.67|41,052,740.68|
|business operation|||
|Sub-total of cash inflow from business|||
||1,684,047,696.92|1,806,435,338.47|
|operations|||
|Cash paid for purchasing|||
||1,796,240,670.15|1,313,329,311.49|
|products and services|||
|Net increase of client trade and|||
|advance|||
|Net increase of savings in central|||
|bank and brother company|||
|Cash paid for original contract|||
|claim|||
|Cash paid for interest, processing|||
|fee and commission|||
|Cash paid for policy dividend|||
|Cash paid to and for the staff|225,245,085.75|167,796,650.09|
|Taxes paid|86,882,633.93|78,014,776.44|
|Other cash paid for business|||
||133,573,236.53|90,749,980.14|
|activities|||
|Sub-total of cash outflow from business|||
||2,241,941,626.36|1,649,890,718.16|
|operations|||
|Cash flow generated by business|||
||-557,893,929.44|156,544,620.31|
|operations, net|||
|2. Cash flow generated by investment:|||
|Cash received from investment|||
||294,000,000.00|120,000,000.00|
|recovery|||
|Cash received as investment profit|2,144,844.81|306,301.37|
|Net cash retrieved from disposal|5,912,795.35|179,704.00|

China Fangda Group Co., Ltd. 2014 Annual Report
||||
|-|-|-|
|of fixed assets, intangible assets, and|||
|other long-term assets|||
|Net cash received from disposal|||
|of subsidiaries or other operational units|||
|Other investment-related cash|||
||65,500.00|429,055.00|
|received|||
|Sub-total of cash inflow generated from|||
||302,123,140.16|120,915,060.37|
|investment|||
|Cash paid for construction of|||
|fixed assets, intangible assets and other|33,875,128.34|40,911,829.63|
|long-term assets|||
|Cash paid as investment|538,263,675.00|130,000,000.00|
|Net increase of loan against|||
|pledge|||
|Net cash paid for acquiring|||
||15,702,424.87||
|subsidiaries and other operational units|||
|Other cash paid for investment|331,500.00|1,659,058.00|
|Subtotal of cash outflows|588,172,728.21|172,570,887.63|
|Cash flow generated by investment|||
||-286,049,588.05|-51,655,827.26|
|activities, net|||
|3. Cash flow generated by financing|||
|activities:|||
|Cash received from investment|||
|Incl. Cash received from|||
|investment attracted by subsidiaries|||
|from minority shareholders|||
|Cash received from borrowed|||
||1,303,817,100.01|529,000,000.00|
|loans|||
|Cash received from bond placing|||
|Other cash received from|||
|financing activities|||
|Subtotal of cash inflow from financing|||
||1,303,817,100.01|529,000,000.00|
|activities|||
|Cash paid to repay debts|575,000,000.00|540,000,000.00|
|Cash paid as dividend, profit, or|||
||67,732,507.84|48,354,192.64|
|interests|||
|Incl. Dividend and profit paid by|||
|subsidiaries to minority shareholders|||

China Fangda Group Co., Ltd. 2014 Annual Report
||||
|-|-|-|
|Other cash paid for financing|||
|activities|||
|Subtotal of cash outflow from financing|||
||642,732,507.84|588,354,192.64|
|activities|||
|Net cash flow generated by financing|||
||661,084,592.17|-59,354,192.64|
|activities|||
|4. Influence of exchange rate changes|||
||259,902.13|-464,717.89|
|on cash and cash equivalents|||
|5. Net increase in cash and cash|||
||-182,599,023.19|45,069,882.52|
|equivalents|||
|Plus: Balance of cash and cash|||
||285,237,255.38|240,167,372.86|
|equivalents at the beginning of term|||
|6. Balance of cash and cash equivalents|||
||102,638,232.19|285,237,255.38|
|at the end of the period|||

6. Cash Flow Statement of the Parent Company
In RMB
||||
|-|-|-|
|Items|Amount occurred in the current period|Occurred in previous period|
|1. Net cash flow from business|||
|operations:|||
|Cash received from sales of|||
||25,532,652.79|44,496,139.39|
|products and providing of services|||
|Tax refunded|||
|Other cash received from|||
||535,560,936.32|580,085,321.10|
|business operation|||
|Sub-total of cash inflow from business|||
||561,093,589.11|624,581,460.49|
|operations|||
|Cash paid for purchasing|||
||6,265,876.89|12,790,698.85|
|products and services|||
|Cash paid to and for the staff|12,900,103.54|10,045,800.12|
|Taxes paid|2,806,998.73|4,659,170.87|
|Other cash paid for business|||
||144,910,876.80|217,012,897.35|
|activities|||
|Sub-total of cash outflow from business|||
||166,883,855.96|244,508,567.19|
|operations|||
|Cash flow generated by business|||
||394,209,733.15|380,072,893.30|
|operations, net|||

China Fangda Group Co., Ltd. 2014 Annual Report
||||
|-|-|-|
|2. Cash flow generated by investment:|||
|Cash received from investment|||
||20,000,000.00||
|recovery|||
|Cash received as investment profit|39,860,211.87||
|Net cash retrieved from disposal|||
|of fixed assets, intangible assets, and|66,000.00|33,241,974.20|
|other long-term assets|||
|Net cash received from disposal|||
|of subsidiaries or other operational units|||
|Other investment-related cash|||
|received|||
|Sub-total of cash inflow generated from|||
||59,926,211.87|33,241,974.20|
|investment|||
|Cash paid for construction of|||
|fixed assets, intangible assets and other|3,257,461.79|1,359,102.96|
|long-term assets|||
|Cash paid as investment|707,011,633.00|50,000,000.00|
|Net cash paid for acquiring|||
|subsidiaries and other operational units|||
|Other cash paid for investment|||
|Subtotal of cash outflows|710,269,094.79|51,359,102.96|
|Cash flow generated by investment|||
||-650,342,882.92|-18,117,128.76|
|activities, net|||
|3. Cash flow generated by financing|||
|activities:|||
|Cash received from investment|||
|Cash received from borrowed|||
||446,000,000.00|194,000,000.00|
|loans|||
|Cash received from bond placing|||
|Other cash received from|||
|financing activities|||
|Subtotal of cash inflow from financing|||
||446,000,000.00|194,000,000.00|
|activities|||
|Cash paid to repay debts|200,000,000.00|470,000,000.00|
|Cash paid as dividend, profit, or|||
||35,741,367.15|43,525,867.31|
|interests|||
|Other cash paid for financing|||
|activities|||

China Fangda Group Co., Ltd. 2014 Annual Report
||||
|-|-|-|
|Subtotal of cash outflow from financingactivities|||
||235,741,367.15|513,525,867.31|
|Net cash flow generated by financingactivities|||
||210,258,632.85|-319,525,867.31|
|4. Influence of exchange rate changeson cash and cash equivalents|||
||-93,226.35|3,306.69|
|5. Net increase in cash and cashequivalents|||
||-45,967,743.27|42,433,203.92|
|Plus: Balance of cash and cashequivalents at the beginning of term|||
||67,973,808.76|25,540,604.84|
|6. Balance of cash and cash equivalentsat the end of the period|||
||22,006,065.49|67,973,808.76|

7. Statement of Change inOwners‟ Equity (Consolidated)
Amount of the Current Term
In RMB
|||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
||Current period|||||||||||||
||Owners’ Equity Attributable to the Parent Company|||||||||||||
|||Other interest tools||||||||||||
|||||||||||||Minor||
||||Perpet|||||||||||
||||||||Other|||Commo|||Total of|
|Items||||||||||||||
|||||||Less:||||||shareho||
||||ual|||||||||||
||Share|Prefer|||Capital||miscella|Special|Surplus|n risk|Retaine||owners’|
||||capita|Other||Shares||||||lders’||
||capital|red|||reserves||neous|reserves|reserves|provisio|d profit||equity|
||||l|s||in stock||||||equity||
|||shares|||||income|||ns||||
||||securi|||||||||||
||||ties|||||||||||
||756,90||||||||||||1,216,0|
|1. Balance at the|||||79,099,||91,831.||46,389,||278,149|55,432,||
||9,905.||||||||||||72,177.|
|end of last period|||||220.38||63||142.21||,631.63|446.89||
||00||||||||||||74|
|Plus:||||||||||||||
|Changes in||||||||||||||
|accounting||||||||||||||
|policies||||||||||||||
|Correction of||||||||||||||
|previous errors||||||||||||||
|Under||||||||||||||
|common control||||||||||||||
|Others||||||||||||||

China Fangda Group Co., Ltd. 2014 Annual Report
|||||||||
|-|-|-|-|-|-|-|-|
|2. Balance at the|756,90||||||1,216,0|
|||79,099,|91,831.|46,389,|278,149|55,432,||
|beginning of|9,905.||||||72,177.|
|||220.38|63|142.21|,631.63|446.89||
|current period|00||||||74|
|3. Amount of||||||||
|change in current||||2,452,9|71,838,|10,171,|84,462,|
|term (“-“ for||||38.55|194.06|317.64|450.25|
|decrease)||||||||
|(1) Total of misc.|||||96,998,|-4,309,0|92,689,|
|incomes|||||429.76|85.10|344.66|
|(2) Investment or||||||||
|||||||16,000,|16,000,|
|decreasing of||||||||
|||||||000.00|000.00|
|capital by owners||||||||
|1. Common shares||||||||
|||||||16,000,|16,000,|
|invested by||||||||
|||||||000.00|000.00|
|shareholders||||||||
|2. Capital invested||||||||
|by other equity||||||||
|tool holders||||||||
|3. Amount of||||||||
|shares paid and||||||||
|accounted as||||||||
|owners’ equity||||||||
|4. Others||||||||
|(3) Profit||||2,452,9|-25,160,||-22,707,|
|allotment||||38.55|235.70||297.15|
|1. Providing of||||2,452,9|-2,452,9|||
|surplus reserves||||38.55|38.55|||
|2. Common risk||||||||
|provision||||||||
|3. Allotment to the||||||||
||||||-22,707,||-22,707,|
|owners (or||||||||
||||||297.15||297.15|
|shareholders)||||||||
|4. Others||||||||
|(4) Internal||||||||
|transferring of||||||||
|owners’ equity||||||||
|1. Capitalizing of||||||||
|capital reserves (or||||||||
|to capital shares)||||||||
|2. Capitalizing of||||||||

China Fangda Group Co., Ltd. 2014 Annual Report
|||||||||
|-|-|-|-|-|-|-|-|
|surplus reserves||||||||
|(or to capital||||||||
|shares)||||||||
|3. Making up||||||||
|losses by surplus||||||||
|reserves||||||||
|4. Others||||||||
|(5) Special||||||||
|reserves||||||||
|1. Provided this||||||||
|year||||||||
|2. Used this term||||||||
|||||||-1,519,5|-1,519,5|
|(6) Others||||||||
|||||||97.26|97.26|
||756,90||||||1,300,534,627.99|
|4. Balance at the||79,099,|91,831.|48,842,|349,987|65,603,||
||9,905.|||||||
|end of this period||220.38|63|080.76|,825.69|764.53||
||00|||||||

 Amount of the Previous Term
In RMB
|||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
||Last period|||||||||||||
||Owners’ Equity Attributable to the Parent Company|||||||||||||
|||Other interest tools||||||||||||
|||||||||||||Minor||
||||Perpet|||||||||||
||||||||Other|||Commo|||Total of|
|Items||||||||||||||
|||||||Less:||||||shareho||
||||ual|||||||||||
||Share|Prefer|||Capital||miscella|Special|Surplus|n risk|Retaine||owners’|
||||capita|Other||Shares||||||lders’||
||capital|red|||reserves||neous|reserves|reserves|provisio|d profit||equity|
||||l|s||in stock||||||equity||
|||shares|||||income|||ns||||
||||securi|||||||||||
||||ties|||||||||||
||756,90||||||||||||1,158,3|
|1. Balance at the|||||79,099,||1,200,6||30,494,||230,907|59,708,||
||9,905.||||||||||||20,726.|
|end of last period|||||220.38||47.26||542.94||,879.99|531.11||
||00||||||||||||68|
|Plus:||||||||||||||
|Changes in||||||||||||||
|accounting||||||||||||||
|policies||||||||||||||
|Correction of||||||||||||||
|previous errors||||||||||||||
|Under||||||||||||||

China Fangda Group Co., Ltd. 2014 Annual Report
|||||||||
|-|-|-|-|-|-|-|-|
|common control||||||||
|Others||||||||
|2. Balance at the|756,90||||||1,158,3|
|||79,099,|1,200,6|30,494,|230,907|59,708,||
|beginning of|9,905.||||||20,726.|
|||220.38|47.26|542.94|,879.99|531.11||
|current period|00||||||68|
|3. Amount of||||||||
|change in current|||-1,108,8|15,894,|47,241,|-4,276,|57,751,|
|term (“-“ for|||15.63|599.27|751.64|084.22|451.06|
|decrease)||||||||
|(1) Total of misc.|||-1,108,8||85,676,|-4,276,|80,291,|
|incomes|||15.63||863.78|084.22|963.93|
|(2) Investment or||||||||
|decreasing of||||||||
|capital by owners||||||||
|1. Common shares||||||||
|invested by||||||||
|shareholders||||||||
|2. Capital invested||||||||
|by other equity||||||||
|tool holders||||||||
|3. Amount of||||||||
|shares paid and||||||||
|accounted as||||||||
|owners’ equity||||||||
|4. Others||||||||
|(3) Profit||||15,894,|-38,435,||-22,540,|
|allotment||||599.27|112.14||512.87|
|1. Providing of||||15,894,|-15,894,|||
|surplus reserves||||599.27|599.27|||
|2. Common risk|||||-22,540,||-22,540,|
|provision|||||512.87||512.87|
|3. Allotment to the||||||||
|owners (or||||||||
|shareholders)||||||||
|4. Others||||||||
|(4) Internal||||||||
|transferring of||||||||
|owners’ equity||||||||
|1. Capitalizing of||||||||
|capital reserves (or||||||||

China Fangda Group Co., Ltd. 2014 Annual Report
|||||||||
|-|-|-|-|-|-|-|-|
|to capital shares)||||||||
|2. Capitalizing of||||||||
|surplus reserves||||||||
|(or to capital||||||||
|shares)||||||||
|3. Making up||||||||
|losses by surplus||||||||
|reserves||||||||
|4. Others||||||||
|(5) Special||||||||
|reserves||||||||
|1. Provided this||||||||
|year||||||||
|2. Used this term||||||||
|(6) Others||||||||
||756,90||||||1,216,0|
|4. Balance at the||79,099,|91,831.|46,389,|278,149|55,432,||
||9,905.||||||72,177.|
|end of this period||220.38|63|142.21|,631.63|446.89||
||00||||||74|

 8. Statement of Change inOwners‟ Equity (Parent Company)
Amount of the Current Term
In RMB
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
||Current period|||||||||||
|||Other interest tools||||||||||
||||Perpetu||||Other|||||
|||||||Less:|||||Total of|
|Items|Share||al||Capital||miscellan|Special|Surplus|Retaine||
|||Preferre||||Shares in|||||owners’|
||capital||capital|Others|reserves||eous|reserves|reserves|d profit||
|||d shares||||stock|||||equity|
||||securiti||||income|||||
||||es|||||||||
|1. Balance at the|756,909,||||38,598,56||||46,389,14|404,953|1,246,943|
||||||||91,831.63|||||
|end of last period|905.00||||5.00||||2.21|,611.77|,055.61|
|Plus:||||||||||||
|Changes in||||||||||||
|accounting||||||||||||
|policies||||||||||||
|Correction of||||||||||||
|previous errors||||||||||||
|Others||||||||||||

China Fangda Group Co., Ltd. 2014 Annual Report
||||||||
|-|-|-|-|-|-|-|
|2. Balance at the|||||||
||756,909,|38,598,56||46,389,14|404,953|1,246,943|
|beginning of|||91,831.63||||
||905.00|5.00||2.21|,611.77|,055.61|
|current period|||||||
|3. Amount of|||||||
|change in current||||2,452,938|-630,85|1,822,088|
|term (“-“ for||||.55|0.24|.31|
|decrease)|||||||
|(1) Total of misc.|||||24,529,|24,529,38|
|incomes|||||385.46|5.46|
|(2) Investment or|||||||
|decreasing of|||||||
|capital by owners|||||||
|1. Common shares|||||||
|invested by|||||||
|shareholders|||||||
|2. Capital invested|||||||
|by other equity|||||||
|tool holders|||||||
|3. Amount of|||||||
|shares paid and|||||||
|accounted as|||||||
|owners’ equity|||||||
|4. Others|||||||
|(3) Profit||||2,452,938|-25,160,|-22,707,2|
|allotment||||.55|235.70|97.15|
|1. Providing of||||2,452,938|-2,452,9||
|surplus reserves||||.55|38.55||
|2. Allotment to the|||||||
||||||-22,707,|-22,707,2|
|owners (or|||||||
||||||297.15|97.15|
|shareholders)|||||||
|3. Others|||||||
|(4) Internal|||||||
|transferring of|||||||
|owners’ equity|||||||
|1. Capitalizing of|||||||
|capital reserves (or|||||||
|to capital shares)|||||||
|2. Capitalizing of|||||||
|surplus reserves|||||||
|(or to capital|||||||

China Fangda Group Co., Ltd. 2014 Annual Report
||||||||
|-|-|-|-|-|-|-|
|shares)|||||||
|3. Making up|||||||
|losses by surplus|||||||
|reserves|||||||
|4. Others|||||||
|(5) Special|||||||
|reserves|||||||
|1. Provided this|||||||
|year|||||||
|2. Used this term|||||||
|(6) Others|||||||
|4. Balance at the|756,909,|38,598,56||48,842,08|404,322|1,248,765,143.92|
||||91,831.63||||
|end of this period|905.00|5.00||0.76|,761.53||

 Amount of the Previous Term
In RMB
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
||Last period|||||||||||
|||Other interest tools||||||||||
||||Perpetu||||Other|||||
|||||||Less:|||||Total of|
|Items|Share||al||Capital||miscellan|Special|Surplus|Retaine||
|||Preferre||||Shares in|||||owners’|
||capital||capital|Others|reserves||eous|reserves|reserves|d profit||
|||d shares||||stock|||||equity|
||||securiti||||income|||||
||||es|||||||||
|1. Balance at the|756,909,||||38,598,56||1,200,647||30,494,54|284,442|1,111,646|
|end of last period|905.00||||5.00||.26||2.94|,731.25|,391.45|
|Plus:||||||||||||
|Changes in||||||||||||
|accounting||||||||||||
|policies||||||||||||
|Correction of||||||||||||
|previous errors||||||||||||
|Others||||||||||||
|2. Balance at the||||||||||||
||756,909,||||38,598,56||1,200,647||30,494,54|284,442|1,111,646|
|beginning of||||||||||||
||905.00||||5.00||.26||2.94|,731.25|,391.45|
|current period||||||||||||
|3. Amount of||||||||||||
|change in current|||||||-1,108,81||15,894,59|120,510|135,296,6|
|term (“-“ for|||||||5.63||9.27|,880.52|64.16|
|decrease)||||||||||||

China Fangda Group Co., Ltd. 2014 Annual Report
||||||
|-|-|-|-|-|
|(1) Total of misc.|-1,108,81||158,945|157,837,1|
|incomes|5.63||,992.66|77.03|
|(2) Investment or|||||
|decreasing of|||||
|capital by owners|||||
|1. Common shares|||||
|invested by|||||
|shareholders|||||
|2. Capital invested|||||
|by other equity|||||
|tool holders|||||
|3. Amount of|||||
|shares paid and|||||
|accounted as|||||
|owners’ equity|||||
|4. Others|||||
|(3) Profit||15,894,59|-38,435,|-22,540,5|
|allotment||9.27|112.14|12.87|
|1. Providing of||15,894,59|-15,894,||
|surplus reserves||9.27|599.27||
|2. Allotment to the|||||
||||-22,540,|-22,540,5|
|owners (or|||||
||||512.87|12.87|
|shareholders)|||||
|3. Others|||||
|(4) Internal|||||
|transferring of|||||
|owners’ equity|||||
|1. Capitalizing of|||||
|capital reserves (or|||||
|to capital shares)|||||
|2. Capitalizing of|||||
|surplus reserves|||||
|(or to capital|||||
|shares)|||||
|3. Making up|||||
|losses by surplus|||||
|reserves|||||
|4. Others|||||
|(5) Special|||||
|reserves|||||

China Fangda Group Co., Ltd. 2014 Annual Report
||||||||
|-|-|-|-|-|-|-|
|1. Provided this|||||||
|year|||||||
|2. Used this term|||||||
|(6) Others|||||||
|4. Balance at the|756,909,|38,598,56||46,389,14|404,953|1,246,943|
||||91,831.63||||
|end of this period|905.00|5.00||2.21|,611.77|,055.61|

 III. General Information
China Fangda Group Co., Ltd. (hereinafter referred to as “the Company” or "Fangda") was established by restructuring Shenzhen Fangda Construction Material Co., Ltd. with the approval Shenzhen Government Office Doc. No. (1995) in October 1995. The Registration No. of theCompany’s business license is: 440301501124785; with a registered capital of RMB756,909,905; registered address: Fangda Building, Kejinan Road 12, High-tech Zone, Shenzhen. Mr. Xiong Jianming is the legal representative.
The Company issued foreign currency shares (B shares) and local currency shares (A shares) and listed in November 1995 and April 1996 respectively in Shenzhen Stock Exchange.
The Company has established a corporate governance structure that comprisesshareholders’ meeting, board of directors and supervisory committee. Currently, the Company sets up the President Office, Administrative Department, HR Department, Enterprise Management Department, Financial Department, Audit and Supervisory Department, Securities Department, Technology Department and IT Department and has established subsidiaries including Fangda Decoration, Fangda Automatic, Fangda New Material, Shenyang Fangda and Fangda Property. Business nature and main business activities of the Company and its subsidiaries (collectively referred to "the Group") include (1) curtain wall segment, production and sales of curtain wall materials, construction curtain wall design, production and installation; (2) rail transport segment, assembly and processing of metro screen doors; (3) real estate development segment, develop and operate real estate projects on land with legal land use rights; property management; (4) new energy segment,R&D, installation and sales of PV devices, design and construction of PV power plants;R&D, design, production, sales and installation of lighting electric accessories and other lighting devices, LED products and hardware products.
The financial statements and notes are approved at the
9th
meeting of the
7th
term of the Board held on March 25, 2015.
The consolidation scope of financial statements in this report period includes the Company and all subsidiaries. New entities incorporated in this report period include Shenzhen Fangda New Energy Co., Ltd., Guangdong Fangda SOZN Lighting Co., Ltd., Shihui International Holding Co., Ltd. During the report period, subsidiary Shenzhen Fangda Yide New Material Co., Ltd. was de-registered. See Note VIII. Changes to the Consolidation Scope and Note IX. Disclosure of Interest in Other Entities for details.
China Fangda Group Co., Ltd. 2014 Annual Report IV Basis for the preparation of financial statements
1. Preparation basis
The financial report is prepared based on enterprise accounting standards issued by the Ministry of Finance and application guide, interpretation and other related provision (collectively “Enterprise Accounting Standards”). The Group has also disclosed related financial information according to the requirement of the Regulations of Information Disclosure No.15– General Provisions for Financial Statements (Revised in 2014) issued by the CSRC.
2. Continuous operation
The Company is capable of continuous operation. The financial statement is prepared based on continuous operation.
The Group's audit is based on the accrual basis. Except for some financial instruments and property held for investment, the financial statements are prepared based on historical costs. In case of any asset impairment, the impairment provision will be made as required.
V Significant Accounting Policies and Estimates
Specific accounting policy and assumption prompt:
1. Statement of compliance to the Accounting Standards for Business Enterprises
The financial report and statements are prepared with compliance to the requirement of the Enterprise Accounting Standards. They reflect the financial position as of December 31, 2014, and business performance and cash flow situation in Year 2014 of the Company frankly and completely.
2. Fiscal period
The fiscal year of the Group is the solar calendar year, that is from January 1 to December 31.
3. Operating period
The operating period of the Group is 12 months.
4. Bookkeeping standard money
The Group takes RMB as the standard currency for bookkeeping.
4. Accounting treatment of the entities under common and different control
(1) Consolidation of entities under common control
Assets and liabilities obtained by the merging party are calculated at their book value with the merged parties at
China Fangda Group Co., Ltd. 2014 Annual Report the merger day in the finalcontroller’s consolidated financial statements in addition to the adjustment made given the difference in accounting policies. The differences between the book value of net assets and the book value of consideration price (or the total of face value of share issued) are adjusted to the capital reserve (share capital premium). If the share capital premium is not enough to offset the difference, it will be adjusted to the retained gains.
(2) Consolidation of entities under different control
For merger of entities under different control, the merger cost is the fair value of the asset paid, liability undertaken, and equity securities issued for exchanging of control power over the entities at the day of acquisition. On the acquisition day, the assets and liabilities (if any) acquired by the Company from the acquired party are recognized on the fair value.
If the merger costs exceed the fair value of the recognizable net assets of the acquired party in the merger, it is recognized as goodwill and measured based the costs after the accumulative impairment provision is deducted; if the fair value exceeds the costs, it is included in the income statement for the period after being re-examined. Involved amount or consideration is included in consolidated cost at the fair value on the day of acquisition. Where the value needs to be adjusted based on the amount on the date of acquisition 12 months later, the consolidated goodwill should be adjusted accordingly.
(3) Treatment of transaction fees in merger
Agency expenses and other administrative expenses such as auditing, legal consulting, or appraisal services occurred relating to the merger of entities are accounted into current income account when occurred. The transaction fees of equity certificates or liability certificates issued by the purchaser for payment for the acquisition are accounted at the initial amount of the certificates.
6. Preparation of Consolidated Financial Statements
(1) Consolidation scope
The consolidation scope of consolidated financial statements is determined based on control. Control refers to a power possessed by the Group on invested entities, the power of enjoying variable return by participating in activities conducted by invested entities, and capabilities of using the power to change the returns. Subsidiaries are enterprises controlled by the Company.
(2) Preparation of Consolidated Financial Statements
Consolidated financial statements are prepared by the Company based on financial statements of the Company and subsidiaries and according to other related information. During preparation of consolidated financial statements, the accounting policies and period of the Company and subsidiaries must be the same. Major transactions and balances between companies are offset.
Subsidiaries and businesses newly incorporated under the same control during the report period are considered incorporated in the consolidation scope since the date on which they are controlled. Business results and cash flows are consolidated in the consolidated income and cash flow statements since the same date.
China Fangda Group Co., Ltd. 2014 Annual Report Incomes, expenses and profits of subsidiaries and businesses newly incorporated under different control and their businesses are consolidated from the date of acquisition and end of the report period in the consolidated income statement, with cash flows consolidated in the consolidated cash flow statement.
The part of theshareholders’ equity in subsidiaries not owned the Company are separately listed under theshareholders’ equity as minorityshareholders’ equity in the consolidated balance sheet. The part of thesubsidiaries’ net profits and losses for the current period that belongs to minority shareholders is listed as minorityshareholders’ profits and losses under net profit in the consolidated income statement. If the losses of subsidiaries shared by the minority shareholders exceed the part of theowners’ equity of the subsidiaries at the beginning of the period, the excessive part will offset the minorityshareholders’ equity.
7. Recognition of cash and cash equivalents
Cash refers to cash on hand and deposits that can be used at any time for payment. Cash equivalent refers to the investments with short term, strong liquidity and small risk of value fluctuation that are held by the Group and easily converted into cash with known amount.
8. Foreign exchange business and foreign exchange statement translation
Trades of the Group made in foreign currencies are translated into RMB basing on the spot exchange rate on the date when the trade is conducted.
At the balance sheet date, foreign currency items are translated on the spot exchange rate of the balance sheet date. The exchange differences caused by the difference in exchange rates on the balance sheet date and initial recognizing date or previous balance sheet date are included in the current profits and losses. Non-monetary items accounted in foreign currency and on historical costs are exchanged with the spot exchange rate on the transaction date. Non-monetary items accounted in foreign currency and on fair value are exchanged with the spot exchange rate on the determination date of the fair value. The exchange difference between the accounting standard-currency amount and the original accounting standard-currency amount are included in the current profits and losses.
9. Financial instrument
Financial instrument refers to acompany’s financial assets and contracts that form other units of financial liabilities or equity instruments.
(1) Recognition and derecognition of financial instrument
The Group recognizes a financial asset or liability when it becomes one party in the financial instrument contract. Financial asset is derecognized when:
(1) The contractual right to receive the cash flows of the financial assets is terminated;
(2) The financial asset is transferred and meets the following derecognition condition.
When partial or all of the current responsibilities attached to such financial liabilities, the partial or all of the
China Fangda Group Co., Ltd. 2014 Annual Report financial liabilities are derecognized. When the Group (debtor) and creditor enter into an agreement to replace the existing financial liabilities by undertaking new financial liabilities and the contract terms for the new financial liabilities are essentially different from those for the existing one, the existing financial liabilities will be derecognized and new financial liabilities will be recognized.
Financial asset transactions in regular ways are recognized and de-recognized on the transaction date.
(2) Classification and measurement of financial assets
Financial assets of the Group are categorized as: financial assets measured at fair value with variations accounted into current income account and account receivables. Financial assets are measured at the fair value at the initial recognition. For financial assets measured at fair value with variations accounted into current income account, related transaction expenses are accounted into the current income. For other financial assets, the related transaction expenses are accounted into the initial recognized amounts.
Financial assets measured at fair value with variations accounted into current income account
It includes transactional financial assets and financial assets measured by fair value and with variations accounted into current gain/loss account at initial recognition. The financial assets are further measured by fair value with the gain/loss created by variations in fair value and related dividends and interest accounted into the current gain/loss account.
Receivables
Receivables refer to non-derivative financial assets without quotations but with fixed recoverable amount or can be confirmed, including receivable accounts and other receivables (Note V. 10). Receivables adopt the effective interest method and are further measured by amortized cost. Gain/loss generated at final recognition, impairment or amortization is accounted into the current gain/loss account.
China Fangda Group Co., Ltd. 2014 Annual Report (3) Classification and measurement of financial liabilities
TheGroup’s financial liabilities are mainly other financial liabilities
Other financial liabilities adopt the effective interest method and are further measured by amortized cost. Gain/loss generated at final recognition or amortization is accounted into the current gain/loss account.
(4) Fair value of financial instrument
See Note V 29 for the method of determining fair value of financial assets and liabilities.
(5) Impairment of financial assets
Financial assets measured at fair value with variations accounted into current income account. The Group checks the book value of financial assets on the balance sheet date. Impairment provision will be made in case of objective evidence proving impairment to the financial assets. Objective evidence proving impairment to the financial assets refers to events actually occur after the initial recognition of financial assets, with influence on the estimated future cash flows of the financial assets and can be reliably measured by the Company.
Objective evidence providing impairment to financial assets includes:
① Severe financial difficulties for the issuer or debtor;
② The debtor violates a contract, for example delaying in paying interest or principal;
③ The Group makes concessions for the debtor with financial difficulties for economic or legal reasons;
④ The debtor is likely to go into liquidation or other financial reorganization;
⑤ The financial assets cannot be traded in an active market due to severe financial difficulties of the issuer;⑥ It is un-recognizable whether the cash flow of an asset in a group of financial assets decreases, but the estimated future cash flow has decreased since the first recognition of the group of financial assets based on general evaluation of open data and the decrease can be measured, including:
- The repaying capability of the debtor of the group of financial assets continues worsening;
- The group of financial assets may not be settled due to economic status of the country or district whether the debtor is located;
⑦ The equity instrument may not be recovered due to material adverse changes to technical, market, economic or legal status of the debtor;
⑧ Other objective evidence proving impairment to financial assets
Financial assets measured at amortized cost
If there is objective evidence proving impairment to the financial assets, the book value of the financial assets will be written down to the present value of the estimated future cash flow (excluding undiscovered future credit loss). The write-down amount is accounted into the current gain/loss account. The present value of the estimated
China Fangda Group Co., Ltd. 2014 Annual Report future cash flow is determined by the original effective discount rate with the value of the guarantee considered. Conduct impairment test separately for major financial assets. If there is objective evidence suggesting impairment, determine the impairment loss and account it into the current gain/loss account. Conduct impairment test for other financial assets including financial assets combination with similar credit risk features. Test financial assets without impairment separately (including major and minor financial assets) and conduct impairment test in the financial assets combination with similar credit risk features. Conduct impairment test for financial assets separately recognized as impaired excluding financial assets combination with similar credit risk features.
After the Group recognizes impair loss to financial assets measured by amortized cost, if there is object evidence suggesting that the value of the financial assets is restored objectively due to an event after the loss, the recognized impairment loss can be reversed and accounted into the current gain/loss account. The book value after the reversal must not exceed the amortized cost of the financial assets on the reversal date assuming that no impairment provision was made.
China Fangda Group Co., Ltd. 2014 Annual Report (6) Transfer of financial assets
The transfer of financial assets refers to transferring or delivering the financial assets to another party (receiver) other than the issuing party of the financial assets.
Recognition of the financial asset is terminated as soon as all of the risks and rewards attached to the financial asset have been transferred to the receiver. Whereas if all of the risks and rewards attached to the financial assets are reserved, recognition of the financial asset shall not be terminated.
When the Group neither transfers nor reserve almost all risks and rewards attached to the financial assets, it will be handled as: When the controlling power over the financial asset is given up, the financial assets will be derecognized and the generated assets and liabilities will be recognized; when the controlling power is not given up, financial asset and related liability shall be recognized according to the extend the Group is involving in the financial asset.
(7) Offsetting of financial assets and liabilities
When the Group has the legal right to offset recognized financial assets and liabilities and can exercise the right, and the Group plans to set them in net value or realize the financial assets or repay the financial liabilities, the financial assets and liabilities are presented in the balance sheet by their amounts after offsetting. Financial assets and liabilities other than the above-mentioned circumstance are presented in the balance sheet separately and are not offset.
10. Receivables
(1) Receivables with major individual amount and bad debt provision provided individually
|||
|-|-|
||For the current year, the Company recognizes project receivables|
||over RMB8 million (inclusive) as “individual receivable with|
||large amount” while recognizes product receivables over RMB2|
|Judging basis or standard of major individual amount||
||million (included) as “individual receivable with large amount”|
||and other receivables over RMB1 million (included) as|
||“individual receivable with large amount”.|
||The Company performs impairment examination individually on|
||each large amount receivables, and recognizes impairment and|
|Provision method for account receivable with major individual|provides bad debt provision when the impairment is recognized|
|amount and bad debt provision provided individually|based on objective evidence. Those not impaired are accounted|
||along with the minor amount receivables and recognized in risk|
||groups.|

(2) Recognition and providing of bad debt provisions on groups
|||
|-|-|
|Group|Method of bad debt provision|
|Account age|Aging method|

China Fangda Group Co., Ltd. 2014 Annual Report
|||
|-|-|
|Receivable accounts consolidated|Other method|

Receivables adopting the aging method in the group
√ Applicable□ Inapplicable
||||
|-|-|-|
|Age|Providing rate for receivable account|Providing rate for other receivables|
|Within 1 year (inclusive)|3.00%|3.00%|
|1-2 years|10.00%|10.00%|
|2-3 years|30.00%|30.00%|
|Over 3 years|50.00%|50.00%|

 Receivables adopting the balance percentage method in the group
□ Applicable√ Inapplicable
Receivables adopting other methods in the group
□ Applicable√ Inapplicable
(3) Receivables with minor individual amount and bad debt provision provided individually
|||
|-|-|
|Reasons for separate bad debt provision|Long account age or deterioration of customer creditability|
||According to the difference between the present value of future|
|Method of bad debt provision||
||cash flow and the book value|

11. Inventories
(1) Classification of inventories
TheGroup’s inventories include purchased materials, raw materials, low-value consumables, OEM materials, products in process, semi-finished goods, finished goods, inventory, development cost, and construction in process.
(2) Pricing of inventory
Inventories are measured at cost when procured. Raw materials, products in process, commodity stocks and goods shipped in transit are measured by the weighted average method.
Construction contracts are measured by the effective cost, including direct and indirect expenses generated before the contracts are fulfilled. Costs generated and recognized accumulatively by construction in process and settled payment are listed in the balance sheet as offset net amounts. The excessive part of the sum of the generated costs and recognized gross profit (loss) over the settled payment is listed inventories; the excessive part of the settled payment over the sum of the generated costs and recognized gross profit (loss) is listed as the prepayment received.
Travel and bidding expenses generated by execution of contracts, if they can be separated and reliably measured
and it is likely to enter into contracts, are accounted as the contract cost when the contracts are entered into; or
into the current gain/loss account if the conditions are not met.
China Fangda Group Co., Ltd. 2014 Annual Report The actual costs of development include land transfer payment, infrastructure and facility costs, installation engineering costs, borrows before completion of the development and other costs during the development process. (3) Recognition of inventory realizable value and providing of impairment provision
12. Assets held for sales
13. Long-term share equity investment
(1) Recognition of initial investment costs
The investment cost of long-term share equity investment formed by entities under common control is the share of the book value of the owner's equity of the merged party on the date of the merger. The investment cost of long-term share equity investment formed by entities under different control is the merger cost on the date of the merger.
For other long-term investment: for those obtained with cash, the initial investment cost is the purchase price. 2. Subsequent measurement and recognition of gain/loss
Long-term equity investments in which the Group can control invested entities are accounted using the cost method; investment in affiliates is accounted using the equity method.
For the long-term equity investment measured on the cost basis, the profit distributed by the invested entity is recognized as investment gains in the current gain/loss account.
When the equity method is used, the current investment gain is the share of the net gain realized in the current year that can be shared or borne.
(3) Basis for recognition of major influence on invested entities
Major influence refers to the power to participate in decision-making of financial and operation policies of a company, but cannot control or jointly control the making of the policies. When determining whether major influence can be added on the invested entity, it should be considered whether the investor directly or indirectly holds voting shares of the invested entity and the investor and the impacts that can be created by switching potential votes held by the investor and other parties into shares of the invested entity, including exchangeable warrants, share options, exchangeable corporate bonds issued by the invested entity.
If the Company directly or through subsidiaries holds more than20% (inclusive) but less than50% of the shares with voting rights of the invested entity, unless there is clear evidence proving that the Company cannot participate the decision-making of production and operation of the invested entity, the Company has major influence on the invested entity; If the Group directly or through subsidiaries holds less than20% (exclusive) of the shares with voting rights of the invested entity, unless there is clear evidence proving that the Group participates the decision-making of production and operation of the invested entity, the Group does not have major influence on the invested entity. (4) Impairment examination and providing of impairment provision
See Note V, 19 for the assets impairment provision method for investment in subsidiaries and joint
China Fangda Group Co., Ltd. 2014 Annual Report ventures.
14. Investment real estates
Measuring method for investment real estate
Measured at fair value
Measuring basis
Investment real estates of the Company are buildings leased.
For investment real estate with an active real estate transaction market and the Company can obtain market price and other information of same or similar real estate to reasonably estimate the investment realestates’ fair value, the Company will use the fair value mode to measure the investment real estate subsequently. Variations in fair value are accounted into the current gain/loss account.
The fair value of investment real estate is determined with reference to the current market prices of same or similar real estates in active markets; when no such price is available, with reference to the recent transaction prices and consideration of factors including transaction background, date and district to reasonably estimate the fair value; or based on the estimated lease gains and present value of related cash flows.
For an investment real estate whose fair value is proven unable to be obtained continuously and reliably by objective evidence, the real estate will be measured at cost basis until it is disposed and no residual value remains as assumed.
The difference of the proceeds from sales, transfer, retirement or destruction of investment real estate with book value and related taxes deducted is accounted into the current gain/loss account.
See Note V 19 for the assets impairment provision method for the investment real estate that is subsequently measured using the cost model.
15. Fixed assets
(1) Recognition conditions
Fixed assets is defined as the tangible assets which are held for the purpose of producing goods, providing services, lease or for operation& management, and have more than one accounting year of service life. The fixed assets can only be recognized hen economic interests related to the fixed assets are very likely to flow into the company and the costs of the fixed assets can be reliably measured. The Group measures fixed assets at the actual costs when the fixed assets are obtained
(2) Depreciation method
||||||
|-|-|-|-|-|
|||||Annual depreciation|
|Type|Depreciation method|Service year|Residual rate||
|||||rate %|
|Houses & buildings|Average age|35-45|10.00%|2-2.57|

China Fangda Group Co., Ltd. 2014 Annual Report
||||||
|-|-|-|-|-|
|Mechanical|||||
||Average age|10|10.00%|9|
|equipment|||||
|Transportation|||||
||Average age|5|10.00%|18|
|facilities|||||
|Electronics and other|||||
||Average age|5|10.00%|18|
|devices|||||

16. Construction in process
The Group recognizes the cost of construction in process according to the actual construction expense, including necessary engineering expenses, borrowing costs to be capitalized before the engineering reaches the preset service condition and other related costs.
Construction in process will be transferred to fixed assets when it reaches the preset service condition.
See Note V, 19 for the provision method for construction in process.
17. Borrowing expenses
(1) Recognition principles for capitalization of borrowing expenses
Borrowing expenses occurred to the Group that can be accounted as purchasing or production of asset satisfying the conditions of capitalizing, are capitalized and accounted as cost of related asset. Borrowing expenses start to be capitalized when all of the followings are satisfied:
(1) Asset expense has already occurred. Asset expenses include cash payment, non-cash asset transferring, or undertaking of debt with interest done for purchasing or producing of assets;
(2) The borrowing expense has already occurred;
(3) Purchasing or production activity, which is necessary for the asset to reach the useful status, has already started.
(2) During borrowing expense capitalization
When the asset satisfying the capitalizing conditions has reached its usable or sellable status, capitalizing of borrowing expenses shall be terminated. Borrowing expenses incurred after assets that meet capitalization conditions reach the service or sales conditions are accounted into the current gain/loss account according to the actual amounts.
If the construction or production of assets satisfying the capitalizing conditions is suspended abnormally for over 3 months, capitalizing of borrowing expenses shall be suspended. During the normal suspension period, borrowing expenses will be capitalized continuously.
(3) Calculation of the capitalization rate and amount of borrowing expense
The interest expense incurred actually from special borrowing in the current period is capitalized after deducting
China Fangda Group Co., Ltd. 2014 Annual Report the interest income obtained from the borrowing that has not been used or investment gain obtained from temporary investment; the capitalization amount of general borrow should be determined according to the weighted average of the excessive part of the accumulative asset expense over the special borrowing multiple the percentage of the special borrowing in general borrowing. The capitalization ratio is calculated according to the weighted average interest rate of general borrowing.
During the capitalization period, the exchange difference of foreign currency special borrowing is fully capitalized; the exchange difference of foreign currency general borrowing is included in the current gain/loss.
18. Intangible assets
(1) Pricing method, service life and impairment test
TheGroup’s intangible assets include land using rights, trademarks, patents, proprietary technologies, and software.
Intangible assets are initially measured at costs and the useful life will be determined when obtained. Where the useful life is limited, the intangible assets will be amortized within the predicted useful life by using the amortization method that can reflect predicted realization way of the economic benefit of the assets; whether the realization way cannot be reliably confirmed, use the straight-line method. If the useful life is uncertain, the intangible assets are not amortized.
Intangible assets with limited useful life are amortized as followings:
|||||
|-|-|-|-|
|Type|Useful life|Basis of amortization|Notes|
|Land using right|Beneficial age|Average age||
|Trademarks and patents|10|Average age||
|Proprietary technology|10|Average age||
|Software|5, 10 years|Average age||
|Other intangible assets|10 years or beneficialage|Average age||

At the end of each year, the Group will reexamine the useful life and amortization basis of intangible assets with limited useful life. If they change, adjust the prediction and handle it according to accounting estimate changes. On the balance sheet day, if the intangible assets become unlikely to bring future economic benefits for the Company, transfer all the intangibleassets’ book value into the current gain/loss account.
See Note II, 20 for the impairment provision method for intangible assets.
(2) Internal research development expense accounting policy
The Group divides internalR&D project expenses into research and development expenses.
The research expenses are accounted the current gain/loss account.
Development expenses can only be capitalized when the following conditions are satisfied: the technology is
feasible for use or sales; there is the intention to use or sell the intangible assets; it can be proven that the product
China Fangda Group Co., Ltd. 2014 Annual Report generated by the intangible assets is demanded or the intangible assets in demanded; if the intangible is used internally, it can be proven that it is useful; with necessary technical and financial resources and other resources to complete the development of the intangible assets and the intangible assets can be used or sold; the development expense can be reliably measured. If not, the development expense is accounted into the current gain/loss account.
If a research project meets the above-mentioned conditions and passes the technical and economic feasibility study, the project will enter the development stage.
Expenses in the development stage capitalized are listed as development expense on the balance sheet and transferred to intangible assets when the project reaches the useful condition.
19. Long-term assets impairment
The Group uses the cost mode to continue measuring the assets impairment to investment real estate, fixed assets construction in progress, intangible assets and goodwill (except for the inventories, investment real estate measured by the fair value mode, deferred income tax assets and financial assets). The method is determined as follows:
The Group judges whether there is a sign of impairment to assets on the balance sheet day. If such sign exists, the Group estimates the recoverable amount and conducts the impairment test. Impairment test is conducted annually for goodwill generated by mergers and intangible assets whose service life is uncertain and that have not reached the useful condition no matter whether the impairment sign exists.
The recoverable amount is determined by the higher of the net of fair value minus disposal expense and the present value of the predicted future cash flow. The Group estimates the recoverable amount on the individual asset item basis; whether it is hard to estimate the recoverable amount on the individual asset item basis, determine the recoverable amount based on the asset group that the assets belong to. The assets group is determined by whether the main cash flow generated by the group is independent from those generated by other assets or assets groups.
When the recoverable amount of the assets or assets group is lower than its book value, the Group writes down the book value to the recoverable amount, the write-down amount is accounted into the current income account and the assets impairment provision is made.
For goodwill impairment test, the book value of goodwill generated by mergers is amortized through reasonable measures since the purchase day to related asset groups; those cannot be amortized to related assets groups are amortized to related combination of asset groups. The related asset groups or combination of asset groups refer to those that can benefit from the synergistic effect of mergers and must not exceed to the reporting range determined by the Group.
When the impairment test is conducted, if there is sign of impairment to the asset group or combination of asset groups related to goodwill, first perform impair test for asset group or combination of asset groups without goodwill and calculate the recoverable amount and recognize the related impairment loss. Then conduct impairment test on those with goodwill, compare the book value with recoverable amount. If the recoverable amount is lower than the book value, recognize the impairment loss of the goodwill.
China Fangda Group Co., Ltd. 2014 Annual Report Once recognized, the asset impairment loss cannot be written back in subsequent accounting period.
20. Long-term amortizable expenses
TheGroup’s long-term amortizable expenses are measured at the actual costs and amortized averagely based on the beneficial term. For long-term amortizable expenses that are not beneficial in the subsequent account periods, the residual value is fully accounted into the current gain/loss account.
21. Staff remuneration
(1) Accounting method of short-term remuneration
In the accounting period, the Group pays medical insurance, employment injury insurance and birth insurance based on their salaries, bonus, and the required ratio. The insurance cost is recognized as liability and included in the gain/loss or related asset cost of the current period. If the liability will not be paid in 12 months after the report period ends and the financial impact is material, the liability is measured at the discounted amount.
(2) Accounting method of post-employment benefit
The Group's post employment welfare scheme is the defined contribution plan. After making fixed payment to an independent fund, the Company will not make further payment to the post-employment welfare scheme, including basic retirement pension and unemployment insurance. In the fiscal period, the payable to the defined contribution plan is recognized as liability and included in the gain/loss or related asset cost of the current period.
22. Anticipated liabilities
When responsibilities occurred in connection to contingent issues, and all of the following conditions are satisfied, they are recognized as expectable liability in the balance sheet:
(1) This responsibility is a current responsibility undertaken by the Group;
(2) Execution of this responsibility may cause financial benefit outflow from the Group;
(3) Amount of the liability can be reliably measured.
The anticipated liabilities are measured at the best estimated expense necessary for fulfilling the liabilities. The book value of expected liability is revised at balance sheet day, and adjustment will be made to reflect current best estimation.
23. Revenue
(1) General principles
1. Sales of goods
When all of the following conditions are satisfied, the sales of goods are recognized as sales income according to
China Fangda Group Co., Ltd. 2014 Annual Report the contract amount received or receivable from the buyer: (1) 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. 2. Providing of labor service
If they are not in the same year, then use the estimation on percentage basis when it is possible.
The completion percentage is the costs occurred on the total cost.
The reliable estimation of the result of providing of labor service must meet the following conditions: A. the revenue can be reliably measured; B. the economic benefit is very likely to flow into the company; C. the completion can be determined reliably; D. costs incurred or will be incurred can be reliably measured.
If the result cannot be reliably estimated, use the service cost amount of the compensation obtained or will be obtained to recognize the revenue of the providing of labor service and recognize the incurred labor service cost as the current expense. If no compensation can be obtained for incurred labor service cost, no revenue can be recognized.
3. Demising of asset using rights
The revenue is recognized when the financial benefit in connection with the demising of asset using right was received and the amount can be reliably measured.
4. Construction contracts
On the balance sheet day, the Group recognizes the contract income and costs using the completion percentage method if the result of the construction contract can be reliably estimated. If not, such contracts are treated differently. If the contract cost can be recovered, the revenue is recognized according to the actual contract costs that can be recovered and the contract cost is recognized as the current expense; if not, the contract cost is recognized as the current expense and no revenue is recognized.
If the estimated total costs exceed the total revenue, the Group recognizes the estimated loss as the current expense.
The competition percentage is determined by the share of the costs incurred in the total cost.
The reliable estimation of the result of a construction contract must meet the following conditions: A. the revenue can be reliably measured; B. the economic benefit is very likely to flow into the company; C. the completion cost can be clearly distinguished and determined reliably; D. the completion and costs that will be incurred for completion of the contract can be reliably recognized.
(2) Specific revenue recognition method
Metro screen door projects of the Company and Shenzhen Fangda Automatic System, and curtain wall project of Fangda Jianke are individual construction contracts. They are accounted by the following means:
Construction contracts completed within a fiscal year are recognized for their income and cost upon completion.
China Fangda Group Co., Ltd. 2014 Annual Report Income and expenses of the construction contracts carried over-year are recognized on percentage basis at balance sheet day when all of the following conditions are satisfied: contract income can be reliably measured, relative financial benefit can inflow to the Company; progress of the project and costs to complete the contract can be reliably recognized; cost occurred to complete the contract can be clearly distinguished and reliably measured, which enables comparing of actual cost with predicted cost.
Contract costs are direct and indirect expenses occurred since the date when the contract is engaged till the completion day. The competition percentage is determined by the share of the costs incurred in the total cost. Construction contracts completed in current term are recognized for income according to the actual total income of the contract less income recognized in previous terms; meanwhile, the total costs of the contract less costs recognized in previous terms are recognized as current contract costs. If the total contract cost is predicted to be greater than the predicted total income, the predicted loss shall be recognized as current cost instantly.
Parts of the curtain wall project under Fangda Jianke are outsourced, and administrative fees are collected at the agreed rate. For these construction contracts, income will be recognized when ongoing payment for the project is received and corresponding costs are transferred.
Revenue of products for domestic sales is recognized when the Group delivers the products and receives the sales payment or obtains the payment voucher; revenue for products for overseas sales is recognized at departure of the products.
24. Government subsidy
(1) Judgment basis and accounting method of governmental subsidies related to assets
Government subsidy is only recognized when the required conditions are met and the subsidy is received. When a government subsidy is monetary capital, it is measured at the received or receivable amount. When there is no clear evidence indicating compliance with related conditions for governmental support and it is estimated that the Company can receive a government subsidy, it will be measured at the receivable amount. Otherwise, it is measured at the amount actually received.
Government subsidies related to assets are obtained by the Group to purchase, build or formulate in other manners long-term assets; or subsidies related to benefits.
For subsidies that can formulate long-term assets without clear government regulations, the part of the subsidies corresponding to the asset value will be measured as assets-related government subsidies, while the rest of them will be measured as benefit-related government subsidies. Where it is difficult to distinguish them from each other, the whole subsidies will be measured as benefit-related government subsidies.
Government subsidies in connection with capital are recognized as differed income, and amortized straight to its useful life, and accounted into current income account.
(2) Judgment basis and accounting method of governmental subsidies related to profit
Government subsidies in connection with gains, which are used to cover current expenses or losses, are
China Fangda Group Co., Ltd. 2014 Annual Report recognized as current gain/loss, if used to cover future expenses or losses, recognized as differed gains, and recorded to current income account to the period when the expenses are recognized. Government subsidy measured at the nominal amount is accounted into current income account.
If a recognized government subsidy needs to be returned, if there are relative differed gains, the balance of differed gains will be setoff, the exceeded part shall be recorded into current income account; if there is no relative differed gain, record to current income account directly.
25. Deferred income tax assets and deferred income tax liabilities
Income tax includes current and deferred income tax Except for the adjustment goodwill generated by mergers or deferred income tax related to transactions or events directly accounted into theowners’ equity, income tax is accounted as income tax expense into the current gain/loss account.
The Group uses the temporary difference between the book value of the assets and liabilities on the balance sheet day and the tax base and the liabilities method to recognize the deferred income tax.
The taxable temporary difference recognizes the related deferred income tax liabilities, unless the taxable temporary difference is created by the following transactions:
(1) Initial recognition of goodwill, or of assets or liabilities generated in transactions with the following features: the transaction is not a merger and the transaction does not affect the accounting profit or taxable proceeds; (2) For taxable temporary difference related to investment in subsidiaries and affiliates, the reversal timing for the temporary difference can be controlled and the difference is unlikely to be reversed in the foreseeable future. For deductable temporary difference, deductible loss and tax deduction that can be accounted in subsequent years, the Group recognizes the incurred deferred income tax assets to the extent to the future income tax proceeds that is very likely to be received for deducting deductable temporary difference, deductable loss and tax deduction, unless the deductable temporary difference is generated in following transactions:
(1) the transaction is not a merger and the transaction does not affect the accounting profit or taxable proceeds; (2) for the taxable temporary difference related to investment in subsidiaries and affiliates, the corresponding deferred income tax assets are recognized when the following condition is met: the temporary difference is very likely to be reversed in the foreseeable future and it is very likely to receive the taxable proceeds that can be used to deduct the deductable temporary difference.
On the balance sheet day, the Group measures the deferred income tax assets and liabilities with the tax rate applicable during the predicted period during which the assets are recovered or the liabilities are paid off and reflects the income tax influence of the assets recovery and liabilities repayment way on the balance sheet day. On the balance sheet day, the Group re-examines the book value of the deferred income tax assets. If it is unlikely to have adequate taxable proceeds to reduce the benefits of the deferred income tax assets, less the deferred income taxassets’ book value. When there is adequate taxable proceeds, the lessened amount will be reversed.
China Fangda Group Co., Ltd. 2014 Annual Report 26. Leasing
(1) Accounting of operational leasing
Rentals from operational leasing are recognized as current gains on straight basis to the periods of leasing. Initial direct expenses are recorded to current income account.
Rentals in operational leasing are recorded to relative capital cost or current income account on straight basis to the periods of leasing. Initial direct expenses are recorded to current income account.
(2) Accounting of financing leasing
The Company as the leasor: In leasing, the book value of financial rental is the sum of lowest amount of the rent and the initial expenses since the date when the lease is started. The difference between the sum of lowest rental, initial direct expense and unsecured balance and the current value is recognized as the unrealized financial income. Unrealized financial income is recognized as financial income at actual interest basis to the periods of the leasing period.
The Company as the leasee: The Company measures the leased assets as the lower of the fair value and the present value of minimum lease payment of the leased assets on the starting date of the lease and records the minimum lease payment as long-term payable and the difference between the two as unrecognized financing expense. The initial direct expense is accounted into asset value. Unrecognized financial cost is recognized as financial cost at actual interest basis to the periods of the leasing period. The Company adopts the depreciation policy same as the self-owned fixed assets to made provision for depreciation of leased assets.
27 Other significant accounting policies and assumptions
Significant accounting judgment and estimate
The Company continuously reviews significant accounting judgment and estimate adopted for the reasonable forecast of future events based on its historical experience and other factors.
Significant accounting judgment and assumptions that may lead to major adjustment of the book value of assets and liabilities in the next accounting year are listed as follows:
(1) Goodwill impairment
The Company judges whether there is impairment to goodwill at least annually. This required valuation of the use value of the asset groups with goodwill. While estimating the use value, the Company needs to estimate the cash flow from the asset group in the future and choose the proper discount rate to calculate the present value of the future cash flow.
(2) Estimate of fair value
The Company uses fair value to measure investment real estate and needs to estimate the fair value of investment real estate at least quarterly. This requires the management to reasonably estimate the fair value of the investment real estate with the half of valuation experts.
(3) Deferred income tax assets
China Fangda Group Co., Ltd. 2014 Annual Report If there is adequate taxable profit to deduct the loss, the deferred income tax assets should be recognized by all the unused tax loss. This requires the management to make a lot of judgment to forecast the time and amount of future taxable profit and determine the amount of the deferred tax assets based on the taxation strategy.
(4) Construction contracts
The Group recognizes gains of construction contracts according to the completion percentage of separated contracts. The management estimates the completion percentage of construction projects according to the actual cost in the total budget and estimates the contract gain. The activity date and completion date are usually included in different accounting periods. The Group will review and revise contract gain and cost estimates in the budget along the progress (if the actual contract gain is smaller than the estimated or actual contract cost, contract estimate loss provision will be made).
28. Major changes in accounting policies and estimates
(1) Changes in accounting policies
√ Applicable□ Inapplicable
||||
|-|-|-|
|Change and reason|Approval procedure|Notes|
|On January 7, 2014, the Ministry of|||
|Finance released three standards|||
|including the Enterprise Accounting||The standards became effective on|
|Standard No.39-Fair Value||July 1, 2014 other than Enterprise|
|Measurement and revised four||Accounting Standard No.37, which|
|standards including the Enterprise||will be effective for 2014 and later|
|Accounting Standard||fiscal periods.|
|No.2-Long-term Share Equity|||
|Investment.|||

In the changes to the accounting policies, no impact is caused by accounting policies other than the following ones.
According to the review Enterprise Accounting Standard No.30– Financial Statement Presentation, the Group adjusts the definition and presentation of other general gain. The part of the original capital reserve that belongs to other general gain is adjusted. Other general gain items that cannot be reclassified into gain/loss and those that can be classified into gain/loss when the conditions are met are distinguished from each other. The Group classifies the opening and end balance of other general gain in capital reserve RMB91,831.63 into other general gain. According to the revised Enterprise Accounting Standard No.30– Financial Statement Presentation, the Group adjusts the presentation of deferred gain. The deferred gain in other non-current liabilities is adjusted into deferred gain. By December 31, 2014, the end balance of other non-current liabilities of RMB10,049,892.04 is classified into deferred gain. The opening balance of 10,255,823.93 is adjusted accordingly.
(2) Changes in accounting estimates
□ Applicable√ Inapplicable
China Fangda Group Co., Ltd. 2014 Annual Report 29. Others
Measured at fair value
Fair value is the price that the market participant needs to pay for acquiring an asset or transfer liability in an orderly transaction on the measurement date.
For assets or liability of the Group measured at fair value, the orderly transaction in which assets are sold or liability is transferred is conducted in the primary market of the related assets or liability; if there is no such primary market, the Group assumes that the transaction is conducted in the most favorable market for the related assets or liability. Primary market (or the most favorable market) is the transaction market that the Group can enter on the measurement date. The Group uses the assumption under which the market participant can maximize the economic benefit when the assets or liability is priced.
For financial assets or liability with an active market, the Group uses the price in the active market to recognize the fair value. If there is no active market, the Company uses evaluation techniques to determine the fair value. Where non-financial assets are measured by fair value, the capability of the assets is the maximum economic benefit of the assets can be realized in the best use of it or other market participant who can make the best use of it.
The Group adopts appropriate and sufficient data and other information-supporting evaluation techniques. Related observable inputs are used firstly. Non-observable inputs are only used when observable inputs cannot be obtained or are infeasible.
The fair value level of assets and liability measured or disclosed at fair value in financial statement are determined according to the lowest input significant for the fair value as a howl: first-level input is the non-adjusted price of the same assets or liability that can be obtained in an active market; second-level input is observable inputs with direct or indirect impact on related assets or liability other than the first-level inputs; third-level inputs are non-observable inputs of related assets and liability.
On each balance sheet day, the Group re-evaluates the assets and liability measured at the fair value and recognized in the financial statements to confirm if any change happens to the fair value measurement level. VI. Taxation
1. Major taxes and tax rates
||||
|-|-|-|
|Tax|Tax basis|Tax rate|
|VAT|Taxable income|6、13、17|
|Business tax|Taxable income|3、5|
|City maintenance and construction tax|Taxable turnover|1、5、7|
|Enterprise income tax|Taxable income|See the following table|
|Education surtax|Taxable turnover|3|

Tax payers vary in the corporate income tax rate are listed as follows
China Fangda Group Co., Ltd. 2014 Annual Report
|||
|-|-|
|Tax payer|Tax rate|
|The Company|25%|
|Shenzhen Fangda Jianke Group Co., Ltd. (hereinafter Fangda||
||15%|
|Jianke)||
|Shenzhen Fangda Automatic System Co., Ltd. (hereinafter||
||15%|
|Fangda Automatic)||
|Shenzhen Fangda Yide New Material Co., Ltd. (hereinafter||
||25%|
|Fangda Yide)||
|Shenzhen Woke Semi-conductor Lighting Co., Ltd. (hereinafter||
||25%|
|Shenzhen Woke)||
|Fangda New Material (Jiangxi) Co., Ltd. (hereinafter Fangda||
||15%|
|New Material)||
|Jiangxi Fangda New Type Aluminum Co., Ltd. (hereinafter||
||25%|
|Fangda Aluminum)||
|Shenyang Fangda Semi-conductor Lighting Co., Ltd. (hereinafter||
||25%|
|Shenyang Fangda)||
|Dongguan Fangda New Material Co., Ltd. (hereinafter||
||25%|
|Dongguan New Material)||
|Shenzhen Kexunda Software Co., Ltd. (hereinafter Kexunda)|25%|
|Chengdu Fangda Construction Technology Co., Ltd. (hereinafter||
||15%|
|Chengdu Fangda)||
|Fangda Decoration Engineering (Shenyang) Co., Ltd.||
||25%|
|(hereinafter Shenyang Decoration)||
|Shenzhen Fangda Property Development Co., Ltd. (hereinafter||
||25%|
|Fangda Property Development)||
|Shenzhen Fangda New Energy Co., Ltd. (hereinafter Fangda||
||25%|
|New Energy)||
|Guangdong Fangda SOZN Lighting Co., Ltd. (hereinafter||
||25%|
|Fangda SOZN)||

2. Tax preference
(1) According to the Certification of High-tech Enterprise issued by Shenzhen Commission of Technological Innovation, Shenzhen Commission of Finance, Shenzhen National Tax Bureau, and Shenzhen Local Tax Bureau on September 12, 2012, Fangda Jianke was entitled to enjoy a tax preference of enterprise income tax of15% for three years (2012-2014) since the qualifications were awarded.
(2) According to the Certification of High-tech Enterprise issued by Shenzhen Commission of Technological
Innovation, Shenzhen Commission of Finance, Shenzhen National Tax Bureau, and Shenzhen Local Tax Bureau
on September 12, 2012, Fangda Automatic was entitled to enjoy a tax preference of enterprise income tax of15%
China Fangda Group Co., Ltd. 2014 Annual Report for three years (2012-2014) since the qualifications were awarded.
(3) According to the Certification of High-tech Enterprise issued by Jiangxi Ministry of Science and Technology, Jiangxi Ministry of Finance, Jiangxi National Tax Bureau, and Jiangxi Local Tax Bureau on November 7, 2012, Fangda New Material was entitled to enjoy a tax preference of enterprise income tax of15% for three years (2012-2014) since the qualifications were awarded.
(4) On December 25, 2013, Kexunda was certified by Shenzhen Nanshan National Tax Bureau as a software and integrated circuit designer according to the Shenzhen National Tax Reduction Registration[2013] No.739 and will enjoy exemption from the enterprise income tax for two years and50% reduction of the same tax for another three years from the year that the company starts making a net profit. Kexunda started making profits in 2013 and therefore starts to enjoy the exemption.
(5) On November 7, 2014, Chengdu Fangda was certified by the Sichuan Xinjin National Tax Bureau as an encouraged business in the west according to the Xinjin National Tax Doc.[zzy024] and will enjoy a preferential corporate income tax rate of15% from January 1, 2014.
V. Notes to the consolidated financial statements
1. Monetary capital
In RMB
||||
|-|-|-|
|Items|Closing balance|Ending balance|
|Cash on hand|40,733.33|33,975.32|
|Bank deposits|114,515,874.25|297,145,634.33|
|Other monetary capital|97,874,191.29|36,697,312.32|
|Total|212,430,798.87|333,876,921.97|
|Including: Overseas deposit|2,370,695.75|65,446.08|

 Notes
1. RMB12 million among the balance of bank deposit at end of year was frozen by the court for the lawsuit involved by Fangda Jianke. For details of the case please see Note XIII, 1.
2. Balance of RMB97,874,191.29 under other monetary capital was mainly deposit for bank accepted notes and letter of guarantee, including deposit of RMB97,792,566.68 for accepted notes and guarantee letter which are not regarded as cash equivalent at preparing of cash flow statement.
3. The36.37% decrease of the closing balance from the opening balance is mainly attributed to increase in investment in the renovation of Fangda Town in the period and purchase of short-term financial products late this report period.
2. Financial assets measured at fair value with variations accounted into current income account
In RMB
||||
|-|-|-|
|Items|Closing balance|Ending balance|

China Fangda Group Co., Ltd. 2014 Annual Report
|||
|-|-|
|Transactional financial assets|13,410,790.00|
|Investment in equity tools|13,410,790.00|
|Total|13,410,790.00|

Notes
The Group holds 100 million shares in Sino Oil and Gas Holdings Limited.
3. Derivative financial assets
□ Applicable√ Inapplicable
4. Notes receivable
(1) Classification of notes receivable
In RMB
||||
|-|-|-|
|Items|Closing balance|Ending balance|
|Bank acceptance bill|2,697,145.86|21,898,770.43|
|Commercial acceptance bill|80,628,579.84||
|Total|83,325,725.70|21,898,770.43|

 (2) Receivable notes endorsed or discounted but not mature at the end of the period
In RMB
||||
|-|-|-|
|Items|De-recognized amount|Not de-recognized amount|
|Bank acceptance bill|75,895,357.71||
|Commercial acceptance bill|14,125,500.00||
|Total|90,020,857.71||

5. Account receivable
(1) Account receivable are disclosed by categories
In RMB
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
||Closing balance|||||Ending balance|||||
||||Bad debt provision|||||Bad debt provision|||
||Remaining book|||||Remaining book|||||
||||balance at the end|||||balance at the end of|||
|Type|value||||Book|value|||||
||||of the period|||||the period||Book value|
||||||value||||||
|||Proportio||Provision|||Proportio||Provision||
||Amount||Amount|||Amount||Amount|||
|||n||rate|||n||rate||
|Recognition and|1,280,50|98.68%|175,879,|13.74%|1,104,625|1,059,9|98.00%|161,204,9|15.21%|898,730,98|

China Fangda Group Co., Ltd. 2014 Annual Report
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
|providing of bad debt|4,982.91||731.45||,251.46|35,942.||60.82||1.93|
|provisions on groups||||||75|||||
|Account receivable||||96.40%|||||||
|with minor individual|||||||||||
||17,154,2||16,537,2||617,000.0|21,620,||21,570,47|||
|amount and bad debt||1.32%|||||2.00%||99.77%|50,000.00|
||85.41||85.41||0|471.60||1.60|||
|provision provided|||||||||||
|individually|||||||||||
|||||14.83%|1,105,242,251.46|1,081,5||||898,780,981.93|
||1,297,65||192,417,|||||182,775,4|||
|Total||100.00%||||56,414.|100.00%||16.90%||
||9,268.32||016.86|||||32.42|||
|||||||35|||||

Account receivable with major individual amount and bad debt provision provided individually at the end of the period:
□ Applicable√ Inapplicable
In the group, the account receivable of which bad debt provision is made through the account aging method:√ Applicable□ Inapplicable
In RMB
|||||
|-|-|-|-|
||Closing balance|||
|Age||Bad debt provision balance at||
||Account receivable||Provision rate|
|||the end of the period||
|Items less than 1 year||||
|Less than 1 year|712,092,320.08|21,362,769.59|3.00%|
|Subtotal for less than 1 year|712,092,320.08|21,362,769.59|3.00%|
|1-2 years|262,647,258.23|26,264,725.84|10.00%|
|2-3 years|123,152,331.43|36,945,699.43|30.00%|
|Over 3 years|182,613,073.17|91,306,536.59|50.00%|
|Total|1,280,504,982.91|175,879,731.45|13.74%|

Note:
Account receivable adopting the balance percentage method in the group:
□ Applicable√ Inapplicable
Account receivable adopting other methods in the group:
None
(2) Bad debt provisions made, recovered or reversed in this period
Bad debt provisions of RMB21,710,901.08 were made in this period; none was recovered or reversed in this period.
Important bad debt write-back or recovery:
In RMB
||||
|-|-|-|
|Entity|Written-back or recovered amount|Method|

China Fangda Group Co., Ltd. 2014 Annual Report (3) Written-off account receivable during the period
In RMB
|||
|-|-|
|Items|Amount|
|Actually written-off account receivable|12,440,143.04|

 Important write-off of account receivable
In RMB
|||||||
|-|-|-|-|-|-|
|Entity|Nature|Amount|Reason|Write-off procedure|Related transaction|

 Notes to written-off account receivable:
Fangda Yide completed liquidation in this period, Accounts receivable of RMB12,058,685.51 were written off. (4) Top 5 account receivable entities at the end of the period
The total balance of accounts receivable due from top 5 account receivable entities at the end of the period is RMB146,062,403.09, accounting for11.26% of the aggregate. Bad debt provisions made totaled
RMB27,719,198.96 at the end of the period.
6. Prepayment
(1) Account age of prepayments
In RMB
||||||
|-|-|-|-|-|
||Closing balance||Ending balance||
|Age|||||
||Amount|Proportion|Amount|Proportion|
|Less than 1 year|24,526,989.72|83.90%|24,086,301.50|84.92%|
|1-2 years|2,991,743.88|10.23%|2,582,202.92|9.10%|
|2-3 years|163,672.10|0.56%|486,463.33|1.72%|
|Over 3 years|1,551,825.79|5.31%|1,209,048.46|4.26%|
|Total|29,234,231.49|--|28,364,016.21|--|

(2) Top 5 prepayment entities at the end of the period
The total balance prepayment made by top 5 prepayment entities at the end of the period is RMB7,819,029.20, accounting for25.71% of the aggregate at the end of the period.
7. Receivable interest
(1) Receivable interest classification
In RMB
China Fangda Group Co., Ltd. 2014 Annual Report
||||
|-|-|-|
|Items|Closing balance|Ending balance|
|Time deposit||36,387.50|
|Total||36,387.50|

8. Other receivables
(1) Other receivables are disclosed by categories
In RMB
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
||Closing balance|||||Ending balance|||||
||||Bad debt provision|||||Bad debt provision|||
||Remaining book|||||Remaining book|||||
||||balance at the end|||||balance at the end of|||
|Type|value||||Book|value|||||
||||of the period|||||the period||Book value|
||||||value||||||
|||Proportio||Provision|||Proportio||Provision||
||Amount||Amount|||Amount||Amount|||
|||n||rate|||n||rate||
|Other receivables|||||||||||
|with major individual|||||||||||
|||||||1,220,3||1,220,316|||
|amount and bad debt|||||||1.47%||100.00%||
|||||||16.84||.84|||
|provision provided|||||||||||
|individually|||||||||||
|Recognition and|||||||||||
||62,085,1||13,134,5||48,950,64|79,642,||13,343,55||66,298,730.|
|providing of bad debt||99.64%||21.16%|||96.15%||16.75%||
||55.66||07.99||7.67|281.33||1.16||17|
|provisions on groups|||||||||||
|Account receivable|||||||||||
|with minor individual|||||||||||
||223,146.||223,146.|||1,971,8||1,971,822|||
|amount and bad debt||0.36%||100.00%|||2.38%||100.00%||
||95||95|||22.77||.77|||
|provision provided|||||||||||
|individually|||||||||||
||62,308,3||13,357,6||48,950,647.67|82,834,||16,535,69||66,298,730.17|
|Total||100.00%||21.44%|||100.00%||19.96%||
||02.61||54.94|||420.94||0.77|||

 Other receivables with major individual amount and bad debt provision provided individually at the end of the period:
□ Applicable√ Inapplicable
In the group, the other receivables of which bad debt provision are made through the account aging method:√ Applicable□ Inapplicable
In RMB
|||||
|-|-|-|-|
||Closing balance|||
|Age|Other receivables at the end of|Bad debt provision balance at||
||||Provision rate|
||the period|the end of the period||
|Items less than 1 year||||

China Fangda Group Co., Ltd. 2014 Annual Report
|||||
|-|-|-|-|
|Subtotal for less than 1 year|23,951,028.17|718,521.63|3.00%|
|1-2 years|12,221,834.10|1,222,183.42|10.00%|
|2-3 years|8,811,718.34|2,643,515.50|30.00%|
|Over 3 years|17,100,575.05|8,550,287.44|50.00%|
|Total|62,085,155.66|13,134,507.99|21.16%|

Note:
Other receivables adopting the balance percentage method in the group:
□ Applicable√ Inapplicable
Other receivables adopting other methods in the group:
□ Applicable√ Inapplicable
(2) Bad debt provisions made, recovered or reversed in this period
Bad debt provisions of RMB1,575,546.4 were made in this period; none was recovered or reversed in this period. (3) Other receivable actually written off in the current period.
In RMB
|||
|-|-|
|Items|Amount|
|Actually written-off other receivable|4,771,216.93|

Notes to written-off other receivables:
Fangda Yide completed liquidation in this period, Other receivables of RMB3,391,658.26 were written off. (4) Other receivables disclosed by nature
In RMB
||||
|-|-|-|
|By account|Closing balance of book value|Opening balance of book value|
|Deposit|37,088,745.12|55,316,690.93|
|Engineering project borrowing and|||
||14,869,519.46|10,722,385.63|
|advance|||
|House disposal receivable|2,136,200.00||
|Staff borrowing and petty cash|1,410,387.87|2,260,157.64|
|VAT refund receivable|576,297.37|278,416.96|
|Others|6,227,152.79|14,256,769.78|
|Total|62,308,302.61|82,834,420.94|

(5) Top 5 other receivable entities at the end of the period
In RMB
China Fangda Group Co., Ltd. 2014 Annual Report
|||||||
|-|-|-|-|-|-|
||||||Bad debt provision|
|||||Percentage in the||
|Entity|By account|Closing balance|Age||balance at the end of|
|||||aggregate||
||||||the period|
|Hainan Green Town||||||
||Deposit|4,346,000.00|1-2 years|6.97%|434,600.00|
|Investment Co., Ltd.||||||
||Advanced|||||
|Wang Weihong||695.00|Less than 1 year|0.00%|20.85|
||engineering cost|||||
||Advanced|||||
|Wang Weihong||352,178.17|1-2 years|0.57%|35,217.82|
||engineering cost|||||
||Advanced|||||
|Wang Weihong||564,963.00|2-3 years|0.91%|169,488.90|
||engineering cost|||||
||Advanced|||||
|Wang Weihong||3,337,246.98|Over 3 years|5.36%|1,668,623.49|
||engineering cost|||||
|Zhejiang Jiayue||||||
||Deposit|500,000.00|1-2 years|0.80%|50,000.00|
|Industrial Co., Ltd.||||||
|Zhejiang Jiayue||||||
||Deposit|3,199,100.00|2-3 years|5.13%|959,730.00|
|Industrial Co., Ltd.||||||
||Advanced|||||
|Xin Song||2,653,327.61|Over 3 years|4.26%|1,326,663.81|
||engineering cost|||||
|Chen Jian Zhong Ji||||||
|(Zhejiang) Business||||||
||Deposit|1,907,624.65|1-2 years|3.06%|190,762.47|
|Development Co.,||||||
|Ltd.||||||
|Total|--|16,861,135.41|--|27.06%|4,835,107.34|

 9. Inventories
(1) Classification of inventories
In RMB
||||||||
|-|-|-|-|-|-|-|
||Closing balance|||Ending balance|||
|Items|Remaining book|Depreciation||Remaining book|Depreciation||
||||Book value|||Book value|
||value|provision||value|provision||
|Raw materials|101,814,705.80|2,551,138.82|99,263,566.98|47,592,162.78|1,492,798.29|46,099,364.49|
|Product in|||||||
||6,682,625.91|2,277.73|6,680,348.18|5,992,333.49||5,992,333.49|
|process|||||||
|Finished goods in|||||||
||22,999,746.67|2,470,651.68|20,529,094.99|10,246,627.50|1,984,145.11|8,262,482.39|
|stock|||||||
|Completed but|251,262,257.58|1,830,742.67|249,431,514.91|229,499,318.33|1,830,742.67|227,668,575.66|

China Fangda Group Co., Ltd. 2014 Annual Report
||||||||
|-|-|-|-|-|-|-|
|not settled assets|||||||
|formulated by|||||||
|construction|||||||
|contracts|||||||
|Low price|||||||
||59,672.66||59,672.66|51,278.67||51,278.67|
|consumable|||||||
|OEM materials|3,358,174.63||3,358,174.63|873,790.05||873,790.05|
|Development cost|603,118,814.70||603,118,814.70|139,590,027.07||139,590,027.07|
|Total|989,295,997.95|6,854,810.90|982,441,187.05|433,845,537.89|5,307,686.07|428,537,851.82|

 (2) Inventory depreciation provision
In RMB
||||||||
|-|-|-|-|-|-|-|
|||Increase in this period||Decrease in this period|||
|Items|Ending balance|||Reversed or||Closing balance|
|||Provision|Others||Others||
|||||written off|||
|Raw materials|1,492,798.29|1,098,377.42||40,036.89||2,551,138.82|
|Product in||||||2,277.73|
|||2,277.73|||||
|process|||||||
|Finished goods in|1,984,145.11|||||2,470,651.68|
|||486,506.57|||||
|stock|||||||
|Completed but|1,830,742.67|||||1,830,742.67|
|not settled assets|||||||
|formulated by|||||||
|construction|||||||
|contracts|||||||
|Total|5,307,686.07|1,587,161.72||40,036.89||6,854,810.90|

 (3) Note
Development cost in the balance at the end of the inventory period includes the capitalization amount of the borrowing cost of RMB15,466,418.47.
(4) Development cost
||||||||
|-|-|-|-|-|-|-|
|Project|Start time|Estimate|Estimated total|Closing amount|Openingamount|Depreciatio|
|||complete time|investment|||n provision|
||||Investment|||at the end of|
|||||||the period|
|Fangda Town|||||||

China Fangda Group Co., Ltd. 2014 Annual Report (5) Completed but not settled assets formulated by construction contracts
In RMB
|||
|-|-|
|Items|Amount|
|Accumulative occurred costs|4,827,856,677.82|
|Accumulative recognized gross margin|767,911,779.61|
|Less: estimated loss|1,830,742.67|
|Settled amount|5,344,506,199.85|
|Completed but not settled assets formulated by construction|249,431,514.91|
|contracts||

10. Other current assets
In RMB
||||
|-|-|-|
|Items|Closing balance|Ending balance|
|Deductible tax input|6,986,107.72||
|Bank financial products|228,000,000.00||
|Total|234,986,107.72||

Notes
Bank financial product in other current assets refers to CCB Qian Yuan– Fu Shun Ying open asset portfolio RMB financial products purchased by the Group and BOC Monthly Plan GSRJYL01 financial product. The financial products are not principal-guaranteed with floating returns.
11. Long-term share equity investment
In RMB Invested entity Opening amount Increase Decrease Closing amount Affiliate
Shenzhen Ganshang
Joint Investment Co., 9,994,565.55 1,054,094.88 11,048,660.43 Ltd.
12. Investment real estates
(1) Investment real estate measured at costs
√ Applicable□ Inapplicable
|||||||
|-|-|-|-|-|-|
|Items||Houses & buildings|Land using right|Construction in process|Total|
||I. Book value|||||
||1. Opening balance|26,150,933.45|||26,150,933.45|

China Fangda Group Co., Ltd. 2014 Annual Report
|||||
|-|-|-|-|
|2. Increased amount in this|20,674,244.77||20,674,244.77|
|period||||
|(1) Transferred from fixed|20,674,244.77||20,674,244.77|
|assets||||
|3. Decreased amount in this|14,743,910.08||14,743,910.08|
|period||||
|(2) Transfer-out for self-use|14,743,910.08||14,743,910.08|
|4. Closing balance|32,081,268.14||32,081,268.14|
|II. Accumulative total||||
|depreciation and||||
|amortization||||
|1. Opening balance|5,680,620.94||5,680,620.94|
|2. Increased amount in this|1,922,459.18||1,922,459.18|
|period||||
|(1) Provision or amortization|768,601.33||768,601.33|
|(2) Transferred from fixed|1,153,857.85||1,153,857.85|
|assets||||
|3. Decreased amount in this|3,287,749.22||3,287,749.22|
|period||||
|(2) Transfer-out for self-use|3,287,749.22||3,287,749.22|
|4. Closing balance|4,315,330.9||4,315,330.90|
|III. Book value||||
|1. Closing book value|27,765,937.24|27,765,937.24||
|2. Opening book value|20,470,312.51|20,470,312.51||

 (2) Investment real estate measured at fair value
√ Applicable□ Inapplicable
In RMB
||||||
|-|-|-|-|-|
|Items|Houses & buildings|Land using right|Construction in process|Total|
|I. Opening balance|174,778,756.62|||174,778,756.62|
|II. Change in the period|23,734,829.53|||23,734,829.53|
|Transfer-in|||||
|from inventory/fixed|||||
|assets/construction in|||||
|progress|||||
|Other|11,162,802.57|||11,162,802.57|

China Fangda Group Co., Ltd. 2014 Annual Report
||||
|-|-|-|
|transfer-out|||
|Change in fair|||
||34,897,632.10|34,897,632.10|
|value|||
|III. Closing balance|198,513,586.15|198,513,586.15|

 (3) Investment real estate without ownership certificate
By December 31, 2014, no property ownership certificate has been applied for any of the investment real estate.
13. Fixed assets
(1) Fixed assets
In RMB
||||||||
|-|-|-|-|-|-|-|
||Houses &|Mechanical|Electronic|Transport|||
|Items|||||Others|Total|
||buildings|equipment|equipment|equipment|||
|1. Opening balance|393,946,389.09|233,769,225.30|40,817,091.98|17,163,113.28||685,695,819.65|
|2. Increased amount in|||||||
||49,617,440.25|11,489,620.93|16,914,554.37|6,723,382.99||84,744,998.54|
|this period|||||||
|(1) Purchase|22,617,056.78|9,615,264.77|12,332,649.64|6,293,372.50||50,858,343.69|
|(2) Transfer-in of|||||||
||1,093,670.82||1,926,646.77|||3,020,317.59|
|construction in progress|||||||
|(3) Merger||1,874,356.16|2,655,257.96|430,010.49||4,959,624.61|
|(4) Transfer-in of investment|||||||
||25,906,712.65|||||25,906,712.65|
|real estates|||||||
|3. Decreased amount in|||||||
||28,887,622.15|738,729.07|1,944,205.02|534,222.55||32,104,778.79|
|this period|||||||
|(1) Disposed or|||||||
||8,213,377.38|738,729.07|1,944,205.02|534,222.55||11,430,534.02|
|retired|||||||
|(2) Other decrease|20,674,244.77|||||20,674,244.77|
|4. Closing balance|414,676,207.19|244,520,117.16|55,787,441.33|23,352,273.72||738,336,039.40|
|1. Opening balance|26,604,093.45|150,791,998.23|21,055,152.64|9,179,557.42||207,630,801.74|
|2. Increased amount in|||||||
||13,723,613.32|9,312,492.67|3,928,791.53|1,768,471.31||28,733,368.83|
|this period|||||||
|(1) Provision|10,435,864.10|9,279,732.35|3,884,506.10|1,762,483.11||25,362,585.66|
|(2) Merger||32,760.32|44,285.43|5,988.20||83,033.95|
|(3) Transfer-in of investment|||||||
||3,287,749.22|||||3,287,749.22|
|real estates|||||||

China Fangda Group Co., Ltd. 2014 Annual Report
|||||||
|-|-|-|-|-|-|
|3. Decreased amount in||||||
||1,854,629.52|183,304.92|1,736,870.15|900,277.55|4,675,082.14|
|this period||||||
|(1) Disposed or||||||
||700,771.67|183,304.92|1,736,870.15|900,277.55|3,521,224.29|
|retired||||||
|(2) Other decrease|1,153,857.85||||1,153,857.85|
|4. Closing balance|38,473,077.25|159,921,185.98|23,247,074.02|10,047,751.18|231,689,088.43|
|1. Opening balance|1,131,563.50|14,003,184.43|||15,134,747.93|
|2. Increased amount in||||||
|||2,651,337.41|||2,651,337.41|
|this period||||||
|(1) Provision||2,651,337.41|||2,651,337.41|
|3. Decreased amount in||||||
||853,819.00||||853,819.00|
|this period||||||
|(1) Disposed or||||||
||853,819.00||||853,819.00|
|retired||||||
|4. Closing balance|277,744.50|16,654,521.84|||16,932,266.34|
|1. Closing book value|375,925,385.44|67,944,409.34|32,540,367.31|13,304,522.54|489,714,684.63|
|2. Opening book value|366,210,732.14|68,974,042.64|19,761,939.34|7,983,555.86|462,930,269.98|

 (2) Temporary idle fixed assets
In RMB
|||||||
|-|-|-|-|-|-|
|||Accumulative|Impairment|||
|Items|Book value|||Book value|Notes|
|||depreciation|provision|||
|Houses & buildings|46,833,628.81|5,086,265.30|277,744.50|41,469,619.01||
|Mechanical||||||
||105,591,939.34|67,175,395.78|15,300,132.34|23,116,411.22||
|equipment||||||
|Transportation||||||
||358,087.84|335,658.73||22,429.11||
|facilities||||||
|Electronics and other||||||
||7,822,284.94|7,317,787.20||504,497.74||
|devices||||||
|Total|160,605,940.93|79,915,107.01|15,577,876.84|65,112,957.08||

(3) Fixed assets without ownership certificate
In RMB
||||
|-|-|-|
|Items|Book value|Reason|
|Houses in Urumuqi for offsetting debt|580,196.93|Applying for|
|Yuehai Office Building C 502|161,032.14|Historical reasons|

China Fangda Group Co., Ltd. 2014 Annual Report
||||
|-|-|-|
|Houses in Dalian of Fangda Jianke for|||
||20,228,382.98|Applying for|
|offsetting debt|||
|Shenyang Fangda extension workshop|17,582,204.34|Entering into liquidation|
|Shenyang Fangda dorm and workshop 2#|8,145,332.66|Entering into liquidation|
|Dining hall and power station of Shenyang|||
||3,913,314.22|Entering into liquidation|
|Fangda|||

14. Construction in process
(1) Construction in progress
In RMB
||||||||
|-|-|-|-|-|-|-|
||Closing balance|||Ending balance|||
|Items|Remaining book|Impairment||Remaining book|Impairment||
||||Book value|||Book value|
||value|provision||value|provision||
|Xinjin energy|||||||
|saving and green|||||||
||341,749.17||341,749.17|26,715.00||26,715.00|
|curtain wall|||||||
|project|||||||
|Decoration of|||||||
|Fangda Building||||914,126.00||914,126.00|
|5F and 20F|||||||
|Total|341,749.17||341,749.17|940,841.00||940,841.00|

 (2) No impairment provision is made for construction in progress.
15. Disposal of fixed assets
In RMB
||||
|-|-|-|
|Items|Closing balance|Ending balance|
|Mechanical equipment|26,918.21|144,421.47|
|Tools and apparatus||3,761.50|
|Transport equipment||2,829.75|
|Other equipment||26,285.39|
|Total|26,918.21|177,298.11|

China Fangda Group Co., Ltd. 2014 Annual Report 16. Intangible assets
(1) Intangible assets
In RMB
|||||||
|-|-|-|-|-|-|
||||Non-patent|||
|Items|Land using right|Patent||Others|Total|
||||technology|||
|1. Opening balance|93,144,805.39|1,266,728.37|24,330,413.42|9,024,654.00|127,766,601.18|
|2. Increased amount in this||||||
||4,870,594.02|4,339,236.09||2,003,730.99|11,213,561.10|
|period||||||
|(1) Purchase|4,870,594.02|69,861.70||2,003,730.99|6,944,186.71|
|(3) Merger||4,269,374.39|||4,269,374.39|
|3. Decreased amount in this||||||
|||40,160.00|||40,160.00|
|period||||||
|(2) Other decrease||40,160.00|||40,160.00|
|4. Closing balance|98,015,399.41|5,565,804.46|24,330,413.42|11,028,384.99|138,940,002.28|
|1. Opening balance|9,476,058.26|832,698.67|15,463,344.49|4,940,985.47|30,713,086.89|
|2. Increased amount in this||||||
||1,889,109.92|491,682.20|571,988.88|824,825.75|3,777,606.75|
|period||||||
|(1) Provision|1,889,109.92|384,947.84|571,988.88|824,825.75|3,670,872.39|
|(2) Merger||106,734.36|||106,734.36|
|3. Decreased amount in this||||||
|||23,886.22|||23,886.22|
|period||||||
|(2) Other decrease||23,886.22|||23,886.22|
|4. Closing balance|11,365,168.18|1,300,494.65|16,035,333.37|5,765,811.22|34,466,807.42|
|1. Opening balance|||5,525,863.77||5,525,863.77|
|4. Closing balance|||5,525,863.77||5,525,863.77|
|1. Closing book value|86,650,231.23|4,265,309.81|2,769,216.28|5,262,573.77|98,947,331.09|
|2. Opening book value|83,668,747.13|434,029.70|3,341,205.16|4,083,668.53|91,527,650.52|

 Intangible asset formed by internalR&D of the period accounts for2.8% of the balance of intangible assets. (2) Failure to obtain the land use right
In RMB
||||
|-|-|-|
|Items|Book value|Reason|
|Chengdu Fangda land use right|4,855,744.50|Applying for|

Notes
Shenyang Fangda, a subsidiary of the Company, entered the liquidation procedure in the period. The amortizable
China Fangda Group Co., Ltd. 2014 Annual Report value RMB5,525,863.77 of non-patent technology without realizable value is fully provided for intangible assets impairment.
17. Goodwill
(1) Original goodwill book value
In RMB
||||||||
|-|-|-|-|-|-|-|
|Invested entity or||Increase||Decrease|||
||Ending balance|||||Closing balance|
|item of goodwill||Merger|Others|Disposal|Others||
|Shenzhen Woke|8,197,817.29|||||8,197,817.29|
|Fangda Yide|746,519.62||||746,519.62||
|Fangda SOZN||26,279,395.89||||26,279,395.89|
|Total|8,944,336.91|26,279,395.89|||746,519.62|34,477,213.18|

 (2) Goodwill impairment provision
In RMB
||||||||
|-|-|-|-|-|-|-|
|Invested entity or||Increase||Decrease|||
||Ending balance|||||Closing balance|
|item of goodwill||Provision|Others|Disposal|Others||
|Shenzhen Woke|8,197,817.29|||||8,197,817.29|
|Fangda Yide|746,519.62||||746,519.62||
|Fangda SOZN|||||||
|Total|8,944,336.91||||746,519.62|8,197,817.29|

 Goodwill impairment test process, parameter and impairment loss recognition method:
1. The Company acquired the100% control power over Shenzhen Woke Co. by merger of enterprise under common control in May 2007. The difference between the initial investment cost and recognizable fair value of the investee has formed the goodwill of RMB8,197,817.29. For Shenzhen Woke was not in good business operation for successive years, impairment provision has been provided fully upon the goodwill.
2. The Company acquired the minority share equities of Fangda Yide Co. in August 2007. The difference between the initial investment cost and recognizable fair value of the investee has formed the goodwill of RMB746,519.62. For Fangda Yide was not in good business operation for successive years, impairment provision has been provided fully upon the goodwill. Given that Fangda Yide was liquidated in 2014, goodwill and goodwill impairment provision of RMB746,519.62 was transferred out.
18. Long-term amortizable expenses
In RMB
|||||||
|-|-|-|-|-|-|
|Items|Ending balance|Increase in this|Amortized in this|Other decrease|Closing balance|

China Fangda Group Co., Ltd. 2014 Annual Report
||||||
|-|-|-|-|-|
|||period|period||
|Epoxy floor|1,120,531.13||162,004.50|958,526.63|
|Plant and dormitory|||||
||1,482,723.37||443,246.64|1,039,476.73|
|decoration|||||
|Upgrading of|||||
|workshop rented by|||||
||284,336.02||41,108.82|243,227.20|
|Fangda Jianke|||||
|Nanchang Branch|||||
|Upgrading of|||||
|workshop rented by|207,303.07||138,636.40|68,666.67|
|Fangda Jianke|||||
|Lifting fee for the|||||
|Anhui SASAC|12,000.00||12,000.00||
|project|||||
|Renovation of office|||||
|and plants rented by|120,243.95|15,621.55|126,752.90|9,112.60|
|Chengdu Fangda|||||
|Jinshan factory|||||
|renovation of|||||
||521,902.82||109,874.16|412,028.66|
|Fangda Jianke|||||
|Shanghai Branch|||||
|Renovation of fixed|||||
|||385,810.80|51,387.63|334,423.17|
|assets leased|||||
|Dongguan isolation|||||
|||389,086.57|77,817.36|311,269.21|
|project|||||
|Upgrading of|||||
|workshop rented by||664,974.60|102,930.29|562,044.31|
|Fangda SOZN|||||
|Anti junk email|||||
|||49,519.66|16,506.60|33,013.06|
|module service fee|||||
|General wiring|||||
|project of the office|||||
|||91,257.00|22,814.28|68,442.72|
|on 5th floor of|||||
|Fangda Building|||||
|Others|50,314.43|60,690.98|31,873.74|79,131.67|
|Total|3,799,354.79|1,656,961.16|1,336,953.32|4,119,362.63|

China Fangda Group Co., Ltd. 2014 Annual Report 19. Deferred income tax assets and deferred income tax liabilities
(1) Not deducted deferred income tax assets
In RMB
||||||
|-|-|-|-|-|
||Closing balance||Ending balance||
|Items|Deductible temporary|Deferred income tax|Deductible temporary|Deferred income tax|
||difference|assets|difference|assets|
|Assets impairment|||||
||215,379,455.02|33,823,708.10|216,510,309.81|35,815,369.06|
|provision|||||
|Unrealized profit of|||||
||11,839,968.61|2,579,827.55|6,715,484.36|1,636,018.35|
|internal transactions|||||
|Deductible loss|56,605,182.29|13,897,641.41|9,460,002.94|2,365,000.74|
|Reserved expense|3,055,220.98|458,283.15|2,361,521.89|354,228.28|
|Reserved wage|3,087,427.61|463,114.14|3,063,966.18|459,594.93|
|Deferred earning|2,161,818.23|515,225.13|2,261,103.48|535,832.20|
|Anticipated liabilities|5,859,045.98|878,856.90|||
|Total|297,988,118.72|52,616,656.38|240,372,388.66|41,166,043.56|

 (2) Not deducted deferred income tax liabilities
In RMB
||||||
|-|-|-|-|-|
||Closing balance||Ending balance||
|Items|Taxable temporary|Deferred income tax|Taxable temporary|Deferred income tax|
||difference|liabilities|difference|liabilities|
|Gain/loss caused by|||||
||198,937,747.60|49,734,436.90|162,627,055.88|40,656,763.97|
|changes in fair value|||||
|Total|198,937,747.60|49,734,436.90|162,627,055.88|40,656,763.97|

 (3) Details of unrecognized deferred income tax assets
In RMB
||||
|-|-|-|
|Items|Closing balance|Ending balance|
|Deductible temporary difference|40,015,820.28|58,902,435.47|
|Deductible loss|70,274,405.85|69,150,558.57|
|Total|110,290,226.13|128,052,994.04|

China Fangda Group Co., Ltd. 2014 Annual Report (4) Deductible losses of the un-recognized deferred income tax asset will expire in the following years In RMB
|||||
|-|-|-|-|
|Year|Closing amount|Opening amount|Notes|
|2014||7,864,870.78||
|2015|7,240,577.12|7,695,652.54||
|2016|19,999,060.04|22,158,289.57||
|2017|20,241,373.78|20,241,373.78||
|2018|11,130,985.83|11,190,371.90||
|2019|11,662,409.08|||
|Total|70,274,405.85|69,150,558.57|--|

20. Other non-current assets
In RMB
||||
|-|-|-|
|Items|Closing balance|Ending balance|
|Prepaid house and equipment amount|41,684,590.97|15,978,789.90|
|Deductible tax input|1,639,287.66||
|Total|43,323,878.63|15,978,789.90|

(1) The increase in the other non-current assets is the house purchase payment made by Fangda Jianke to Dalian Gaoxin Wanda Plaza Investment Co., Ltd., Tianjin Wanda Center Investment Co., Ltd. and Zixi Greentown Investment Co., Ltd.
(2) The deductible tax input increased in the period because Shenyang Fangda and Shenzhen Woke stopped operation and cannot obtain sufficient sales tax deduction in the short term.
21. Short-term borrowings
(1) Classification of short-term borrowings
In RMB
||||
|-|-|-|
|Items|Closing balance|Ending balance|
|Loan by pledge|200,000,000.00|104,000,000.00|
|Guarantee loan|900,000,000.00|265,000,000.00|
|Total|1,100,000,000.00|369,000,000.00|

Notes to classification of short-term borrowings
By December 31, 2014, the Group's pledged borrowings are using buildings as pledge.
China Fangda Group Co., Ltd. 2014 Annual Report 22. Notes payable
In RMB
||||
|-|-|-|
|Type|Closing balance|Ending balance|
|Commercial acceptance|12,106,210.45|9,356,905.04|
|Bank acceptance|215,160,275.12|179,213,945.59|
|Total|227,266,485.57|188,570,850.63|

 23. Account payable
(1) Account payable
In RMB
||||
|-|-|-|
|Items|Closing balance|Ending balance|
|Account repayable and engineering|||
||558,886,064.80|366,465,573.67|
|payables|||
|Construction payable|21,675,087.66|10,418,557.07|
|Payable installation and|||
||102,780,295.76|107,489,398.01|
|implementation fees|||
|Others|1,766,898.51|4,842,611.57|
|Total|685,108,346.73|489,216,140.32|

24. Prepayment received
(A) Prepayment
In RMB
||||
|-|-|-|
|Items|Closing balance|Ending balance|
|Curtain wall and screen door|||
||115,346,105.96|163,602,896.86|
|engineering payment|||
|Material loan|6,106,352.73|1,970,928.42|
|Others|832,772.45|2,812,426.66|
|Total|122,285,231.14|168,386,251.94|

(2) Major prepayment aged over 1 year
In RMB
||||
|-|-|-|
|Items|Closing balance|Reason|
|Fuzhou Metro Co., Ltd.|3,234,553.34|Engineering prepayment|

China Fangda Group Co., Ltd. 2014 Annual Report
||||
|-|-|-|
|Xi'an Metro Co., Ltd.|3,143,967.62|Engineering prepayment|
|Total|6,378,520.96|--|

25.Employees‟ wage payable
(1)Employees‟ wage payable
In RMB
||||||
|-|-|-|-|-|
|Items|Ending balance|Increase|Decrease|Closing balance|
|1. Short-term|||||
||30,102,357.84|225,699,515.08|214,150,801.41|41,651,071.51|
|remuneration|||||
|2. Post employment|||||
|welfare scheme - defined|80,493.96|11,359,604.66|11,387,855.87|52,242.75|
|contribution plan|||||
|Total|30,182,851.80|237,059,119.74|225,538,657.28|41,703,314.26|

 (2) Short-term remuneration
In RMB
||||||
|-|-|-|-|-|
|Items|Ending balance|Increase|Decrease|Closing balance|
|1. Wage, bonus,|||||
|allowance and|27,807,395.20|206,363,308.89|194,651,151.04|39,519,553.05|
|subsidies|||||
|2. Employee welfare|32,064.56|9,295,212.85|9,327,277.41||
|3. Social insurance|56,233.99|5,242,822.78|5,259,444.02|39,612.75|
|Including: medical|||||
||51,062.33|4,285,469.08|4,302,961.41|33,570.00|
|insurance|||||
|Labor injury|||||
||3,429.18|684,771.38|684,843.56|3,357.00|
|insurance|||||
|Breeding insurance|1,742.48|272,582.32|271,639.05|2,685.75|
|4. Housing fund|99,607.50|4,176,672.82|4,233,695.12|42,585.20|
|5. Labor union|||||
|budget and staff|2,107,056.59|621,497.74|679,233.82|2,049,320.51|
|education fund|||||
|Total|30,102,357.84|225,699,515.08|214,150,801.41|41,651,071.51|

 (3) Defined contribution plan
In RMB
China Fangda Group Co., Ltd. 2014 Annual Report
||||||
|-|-|-|-|-|
|Items|Ending balance|Increase|Decrease|Closing balance|
|1. Basic pension|73,842.08|10,611,654.97|10,635,742.05|49,755.00|
|2. Unemployment|||||
||6,651.88|747,949.69|752,113.82|2,487.75|
|insurance|||||
|Total|80,493.96|11,359,604.66|11,387,855.87|52,242.75|

 26. Taxes payable
In RMB
||||
|-|-|-|
|Items|Closing balance|Ending balance|
|VAT|6,739,115.69|-1,250,348.83|
|Business tax|25,489,264.49|23,221,596.65|
|Enterprise income tax|16,071,901.30|15,884,641.78|
|Personal income tax|1,228,564.47|902,435.66|
|City maintenance and construction tax|2,329,212.21|1,895,518.80|
|Land using tax|2,534,674.36|1,515,989.53|
|Property tax|2,287,765.04|1,477,538.33|
|Education surtax|1,123,167.45|907,151.22|
|Local education surtax|298,064.57|148,031.74|
|Others|595,196.67|137,392.89|
|Total|58,696,926.25|44,839,947.77|

 27. Interest payable
In RMB
||||
|-|-|-|
|Items|Closing balance|Ending balance|
|Short-term borrowing interests payable|2,055,911.11|689,153.75|
|Total|2,055,911.11|689,153.75|

Notes
The interest payable at the end of the period increased198.32% from the beginning because theGroup’s bank borrowing increased.
28. Other payables
(1) Other payables by nature
In RMB
||||
|-|-|-|
|Items|Closing balance|Ending balance|

China Fangda Group Co., Ltd. 2014 Annual Report
||||
|-|-|-|
|Performance and quality deposit|22,806,218.88|20,142,316.44|
|Deposit|6,264,664.14|6,931,340.61|
|Reserved expense|9,369,196.08|6,587,792.11|
|Others|8,985,603.34|8,026,131.56|
|Total|47,425,682.44|41,687,580.72|

(2) Other major payables aged over 1 year
In RMB
||||
|-|-|-|
|Items|Closing balance|Reason|
|Guangzhou Nanjiang Civil Engineering||Performance deposit, the engineering|
||8,289,683.50||
|Co., Ltd.||payment is unsettled|
|Guangzhou Nanjian Civil Engineering Co.,||Performance deposit, the engineering|
||3,000,000.00||
|Ltd.||payment is unsettled|
|Ningbo Lailai Energy-Saving Door &|||
||2,060,000.00|Deposit|
|Windows Development Co., Ltd.|||
|Total|13,349,683.50|--|

29. Non-current liabilities due within 1 year
In RMB
||||
|-|-|-|
|Items|Closing balance|Ending balance|
|Long-term payables due within 1 year|6,000,000.00||
|Total|6,000,000.00||

Notes
Long-term payable due within 1 year is the share transfer payable within one year according to investment agreement and share transfer agreement for acquisition of60% shares in Fangda SOZN by Fangda New Energy. 30. Long-term payables
(1) Long-term payables by nature
In RMB
||||
|-|-|-|
|Items|Closing balance|Ending balance|
|Share transfer payable|12,000,000.00||
|Subtotal|12,000,000.00||
|Less: Long-term payables due within 1|||
||6,000,000.00||
|year|||
|Total|6,000,000.00||

China Fangda Group Co., Ltd. 2014 Annual Report Notes
The share transfer payable is the transfer payment due within more than 1 year according to investment agreement and share transfer agreement for acquisition of60% shares in Fangda SOZN by Fangda New Energy.
31. Anticipated liabilities
In RMB
|||||
|-|-|-|-|
|Items|Closing balance|Ending balance|Reason|
|Pending lawsuit|5,039,045.98||See Note XIII, 1|
|Others|820,000.00|||
|Total|5,859,045.98||--|

32. Deferred earning
In RMB
|||||||
|-|-|-|-|-|-|
|Items|Ending balance|Increase|Decrease|Closing balance|Reason|
|Government subsidy|10,255,823.93||205,931.89|10,049,892.04|Assets-related|
|Total|10,255,823.93||205,931.89|10,049,892.04|--|

In RMB
||||||||
|-|-|-|-|-|-|-|
||||Amount included||||
|||Amount of new||||Related to|
|Liabilities|Ending balance||in non-operating|Other change|Closing balance||
|||subsidy||||assets/earning|
||||revenue||||
|Major investment|||||||
|project prize from|||||||
|Industry and|||||||
|Trade|||||||
||1,966,666.70||57,142.80||1,909,523.90|Assets-related|
|Development|||||||
|Division of|||||||
|Dongguan|||||||
|Finance Bureau|||||||
|Massive|||||||
|production|||||||
|project of|||||||
|air-breathing|||||||
||7,994,720.45||106,646.64||7,888,073.81|Assets-related|
|double-layer|||||||
|hollow glass|||||||
|energy-saving|||||||
|curtain call|||||||
|Railway transport|294,436.78||42,142.45||252,294.33|Assets-related|

China Fangda Group Co., Ltd. 2014 Annual Report
||||||
|-|-|-|-|-|
|screen door|||||
|controlling|||||
|system and|||||
|information|||||
|transmission|||||
|technology|||||
|Total|10,255,823.93|205,931.89|10,049,892.04|--|

 Notes
(1) The Dongguan Finance Bureau Industry and Trade Development Division major subsidy project is a subsidized project not stipulated in Dongguan Financial Circular[2013] No.779. As the project has formed into long-term assets, the Company treats it as an assets-related government subsidy.
(2) The massive production project of air-breathing double-layer hollow glass energy-saving curtain wall is a subsidized project stipulated in Guangdong Financial Doc[2013] No.183. As the project has formed into long-term assets, the Company treats it as an assets-related government subsidy.
(3) The railway transport screen door controlling system and information transmission technology is a subsidized project stipulated in Shenzhen Tech Innovation[2013] No.242. RMB300,000 is used to purchase equipment and RMB900,000 is used to purchase materials and for travel fees. As the project has formed into long-term assets, the Company treats RMB300,000 as assets-related government subsidy and RMB900,000 as earning-related government subsidy.
33. Capital share
In RMB
|||||||||
|-|-|-|-|-|-|-|-|
|||Change (+,-)||||||
||||||||Closing|
||Ending balance|Issued new||Transferred||||
||||Bonus shares||Others|Subtotal|balance|
|||shares||from reserves||||
|Total of capital|756,909,905.00||||||756,909,905.00|
|shares||||||||

34. Capital reserve
In RMB
||||||
|-|-|-|-|-|
|Items|Ending balance|Increase|Decrease|Closing balance|
|Capital premium (share|||||
||38,238,222.48|||38,238,222.48|
|capital premium)|||||
|Other capital reserves|40,860,997.90|||40,860,997.90|
|Total|79,099,220.38|||79,099,220.38|

China Fangda Group Co., Ltd. 2014 Annual Report 35. Other miscellaneous income
In RMB
|||||||||
|-|-|-|-|-|-|-|-|
|||Amount occurred in the current periodLess: amountwritten intoAfter-tax After-taxBefore tax other gains Less:attributable attributablein current and transferred Income taxto parent to minorityperiod into gain/loss expensescompany shareholderin previousterms||||||
||||Less: amount|||||
||||written into|||||
||||||After-tax|After-tax||
||Ending|Before tax|other gains|Less:|||Closing|
|Items||||||||
||||||attributable|attributable||
||balance|in current|and transferred|Income tax|||balance|
||||||to parent|to minority||
|||period|into gain/loss|expenses||||
||||||company|shareholder||
||||in previous|||||
||||terms|||||
|(2) Other comprehensive gain that||||||||
||91,831.63||||||91,831.63|
|will be classified into gain/loss||||||||
|Investment real estate measured at||||||||
||91,831.63||||||91,831.63|
|fair value||||||||
|Total of other miscellaneous income|91,831.63||||||91,831.63|

 36. Surplus reserves
In RMB
||||||
|-|-|-|-|-|
|Items|Ending balance|Increase|Decrease|Closing balance|
|Statutory surplus|||||
||46,389,142.21|2,452,938.55||48,842,080.76|
|reserves|||||
|Total|46,389,142.21|2,452,938.55||48,842,080.76|

 Note:
The increase in the surplus reserve is attributable to the10% provision on the after-tax net profit of the parent according to Articles of Association of the Company.
37. Retained profit
In RMB
||||
|-|-|-|
|Items|Current period|Last period|
|Adjustment on retained profit of previous period|278,149,631.63|230,907,879.99|
|Retained profit adjusted at beginning of year|278,149,631.63|230,907,879.99|
|Plus: Net profit attributable to owners of theparent|||
||96,998,429.76|85,676,863.78|
|Less: Statutory surplus reserves|2,452,938.55|15,894,599.27|
|Common share dividend payable|22,707,297.15|22,540,512.87|
|Closing retained profit|349,987,825.69|278,149,631.63|

China Fangda Group Co., Ltd. 2014 Annual Report Details of retained profit adjusted at beginning of the period
1) Retrospective adjustment due to adopting of the Enterprise Accounting Standard and related regulations, included the retained profit by RMB0.
2) Variation of accounting policies, influenced the retained profit by RMB0.
3) Correction of material accounting errors, influenced the retained profit by RMB0.
4) Change of consolidation range caused by merger of entities under common control, influenced the retained profit by RMB0.
5) Other adjustment influenced the retained profit by RMB0.
38. Operational revenue and costs
In RMB
||||||
|-|-|-|-|-|
||Amount occurred in the current period||Occurred in previous period||
|Items|||||
||Income|Cost|Income|Cost|
|Main business|1,896,533,575.46|1,573,131,645.17|1,697,728,577.19|1,412,825,229.71|
|Other business|41,790,860.05|17,705,140.85|49,892,268.55|12,543,974.71|
|Total|1,938,324,435.51|1,590,836,786.02|1,747,620,845.74|1,425,369,204.42|

 39. Business tax and surcharge
In RMB
||||
|-|-|-|
|Items|Amount occurred in the current period|Occurred in previous period|
|Business tax|14,227,005.22|13,788,191.30|
|City maintenance and construction tax|4,077,936.61|4,071,880.14|
|Education surtax|2,163,665.87|1,921,563.67|
|Property tax|1,019,630.24|1,232,548.46|
|Land using tax|107,681.50|150,753.68|
|Others|1,259,720.55|2,107,376.59|
|Total|22,855,639.99|23,272,313.84|

Notes
See VI. Tax for the calculation standard of business tax and surcharges.
40. Sales expense
In RMB
||||
|-|-|-|
|Items|Amount occurred in the current period|Occurred in previous period|
|Labor costs|23,748,948.40|20,594,907.02|
|Freight and miscellaneous charges|6,207,886.36|6,061,750.15|

China Fangda Group Co., Ltd. 2014 Annual Report
||||
|-|-|-|
|Travel expense|5,067,027.92|3,211,228.05|
|Entertainment expense|2,204,861.40|1,956,831.61|
|Material consumption|1,449,539.85|911,912.24|
|Office costs|1,246,910.58|1,856,349.96|
|Rental|1,295,860.13|975,957.59|
|Advertisement and business promotion|||
||2,041,379.42|523,282.43|
|cost|||
|Others|1,421,892.64|1,290,822.55|
|Total|44,684,306.70|37,383,041.60|

41. Management expenses
In RMB
||||
|-|-|-|
|Items|Amount occurred in the current period|Occurred in previous period|
|Labor costs|75,477,871.56|61,712,341.07|
|Depreciation and amortization|18,501,963.63|20,496,282.99|
|Agencies|3,603,925.17|1,934,253.99|
|Tax|6,689,450.36|5,462,000.30|
|Maintenance costs|4,055,124.83|2,775,338.16|
|Water and electricity|1,594,371.07|1,552,664.57|
|Office expense|3,010,166.04|3,588,714.66|
|Travel expense|2,577,863.90|2,357,134.52|
|R&D|16,901,351.15|9,671,242.90|
|Entertainment expense|2,024,918.27|1,653,162.04|
|Rental|2,334,921.30|3,591,131.18|
|Lawsuit|1,950,459.20|2,411,335.91|
|Material consumption|1,754,537.01|470,234.11|
|Property management fee|2,386,763.59|2,357,853.90|
|Others|9,721,026.52|7,220,556.96|
|Total|152,584,713.60|127,254,247.26|

42. Financial expenses
In RMB
||||
|-|-|-|
|Items|Amount occurred in the current period|Occurred in previous period|
|Interest expense|46,439,424.36|24,548,276.25|

China Fangda Group Co., Ltd. 2014 Annual Report
||||
|-|-|-|
|Less: Interest capitalization|15,466,418.47||
|Less: Interest income|3,193,733.32|3,054,605.10|
|Acceptant discount|248,232.09||
|Exchange gain/loss|-383,218.13|861,872.66|
|Less: exchange gain/loss capitalization|||
|Commission charges and others|1,520,772.27|753,042.58|
|Total|29,165,058.80|23,108,586.39|

43. Assets impairment loss
In RMB
||||
|-|-|-|
|Items|Amount occurred in the current period|Occurred in previous period|
|1. Bad debt loss|23,199,527.20|33,742,863.78|
|2. Inventory depreciation loss|1,587,161.72|40,254.89|
|7. Fixed assets impairment loss|2,651,337.41||
|Total|27,438,026.33|33,783,118.67|

44. Income from fair value fluctuation
In RMB
||||
|-|-|-|
|Source of income from fluctuation of fair|||
||Amount occurred in the current period|Occurred in previous period|
|value|||
|Financial assets measured at fair value|||
|with variations accounted into current|-2,852,885.00||
|income account|||
|Investment real estate measured at fair|||
||34,897,632.10|16,647,859.74|
|value|||
|Total|32,044,747.10|16,647,859.74|

45. Investment income
In RMB
||||
|-|-|-|
|Items|Amount occurred in the current period|Occurred in previous period|
|Gains from long-term equity investment|||
||1,054,094.88|-5,434.45|
|measured by equity|||
|Investment income from disposal of long-term|||
||-1,478,245.70||
|equity share investment|||
|Other investment gains|2,144,844.80|306,301.37|

China Fangda Group Co., Ltd. 2014 Annual Report
||||
|-|-|-|
|Total|1,720,693.98|300,866.92|

46. Non-business income
In RMB
|||||
|-|-|-|-|
||Amount occurred in the current||Amount accounted into the|
|Items||Occurred in previous period||
||period||current accidental gain/loss|
|Total of gains from disposal of|3,162,999.40|154,552.62||
||||3,162,999.40|
|non-current assets||||
|Including: Gains from disposal||||
||3,162,999.40|154,552.62|3,162,999.40|
|of fixed assets||||
|Government subsidy|2,340,175.75|1,815,855.07|2,340,175.75|
|Penalty income|217,749.21|228,295.79|217,749.21|
|Compensation received|41,826.64|190,428.00|41,826.64|
|VAT rebated into revenue|1,886,134.97|818,825.27||
|Payable account not able to be||||
||1,447,458.99|250,648.50|1,447,458.99|
|paid||||
|Others|7,185,114.22|4,137,250.99|7,185,114.22|
|Total|16,281,459.18|7,595,856.24|14,395,324.21|

 Government subsidies accounted into current profit or loss:
In RMB
|||||
|-|-|-|-|
|Item|Occurred in current period|Occurred in previous period|Related to assets/earning|
|Railway transport screen door||||
|controlling system and||||
||42,142.45|935,563.22|Assets-related|
|information transmission||||
|technology||||
|Major investment project prize||||
|from Industry and Trade||||
||57,142.80|33,333.30|Assets-related|
|Development Division of||||
|Dongguan Finance Bureau||||
|Massive production project of||||
|air-breathing double-layer||||
||106,646.64|25,279.55|Assets-related|
|hollow glass energy-saving||||
|curtain call||||
|Shenzhen hi-tech project||||
||1,011,800.00||Earning-related|
|subsidy||||
|Chinese famous brand,||||
|Guangdong famous brand and|200,000.00||Earning-related|
|Guangdong famous product||||

China Fangda Group Co., Ltd. 2014 Annual Report
|||||
|-|-|-|-|
|subsidies||||
|Nanchang Industry Information||||
|Committee and Financial||||
||200,000.00||Earning-related|
|Department subsidies for||||
|formulating industry standards||||
|Nanchang hi-tech industry part||||
|management committee subsidy||||
||100,000.00||Earning-related|
|for technological development||||
|projects||||
|Chengdu new material||||
||100,000.00||Earning-related|
|company award||||
|Nanchang high-tech zone||||
|management committee subsidy||||
||150,000.00||Earning-related|
|for formulating industry||||
|standards||||
|Nanchang hi-tech industry||||
|development zone management||||
||141,100.00||Earning-related|
|committee subsidy for hi-tech||||
|industries||||
|Jiangxi Financial Ministry||||
||136,700.00||Earning-related|
|export exhibition subsidy||||
|Private enterprise and SME||||
|development fund IT||570,000.00|Earning-related|
|construction project subsidy||||
|2012 High-quality foreign trade||||
|export subsidy granted by||188,179.00|Earning-related|
|Shenzhen Finance Commission||||
|Nanchang Quality and||||
|Technology Supervision Bureau||50,000.00|Earning-related|
|well-known brand product prize||||
|Others|94,643.86|13,500.00|Earning-related|
|Total|2,340,175.75|1,815,855.07|--|

Notes
Major projects are disclosed as follows:
1. Fangda Jianke recovered the revenue of RMB4,893,062.86 related to the Dalian Yunshan engineering project.
2. Waste income RMB1,446,492.20
China Fangda Group Co., Ltd. 2014 Annual Report 47. Non-business expenses
In RMB
|||||
|-|-|-|-|
||Amount occurred in the current||Amount accounted into the|
|Items||Occurred in previous period||
||period||current accidental gain/loss|
|Total of losses from disposal of|1,709,152.13|617,106.70||
||||1,709,152.13|
|non-current assets||||
|Including: Losses from disposal||||
||1,709,152.13|446,022.67|1,709,152.13|
|of fixed assets||||
|Donation|958,000.00|367,000.00|958,000.00|
|Penalty and overdue fine|364,256.62|173,744.23|364,256.62|
|Estimated lawsuit compensation|5,039,045.98||5,039,045.98|
|Others|2,553,257.37|186,524.37|2,553,257.37|
|Total|10,623,712.10|1,344,375.30|10,623,712.10|

 Notes
(1) See Note XIII, 1 for estimated lawsuit compensation.
(2) Major amounts are disclosed as follows:
Shenyang Fangda made a provision of RMB411,590.52 according to the judgment of the semi-conductor industry park phase I chip packaging plant construction contract; Shenyang Fangda made a provision of RMB354,119.76 according to the judgment of the semi-conductor industry park phase I dormitory and plant#2 construction contract; Shenyang Fangda made a provision of RMB100,306.06 for the semi-conductor purchase and sales contract with Dongguan Enrui Precision Equipment Co., Ltd. Shenyang Fangda made a provision of RMB1,034,158.33 for the payable engineering amount according to the judgment of the P16 full-color LED display engineering contract with Shenyang Xingmoer.
48. Income tax expenses
(1) Income tax expenses
In RMB
||||
|-|-|-|
|Items|Amount occurred in the current period|Occurred in previous period|
|Income tax expenses|18,618,875.30|19,777,942.50|
|Deferred income tax expenses|-1,125,127.73|-528,180.90|
|Total|17,493,747.57|19,249,761.60|

(2) Accounting profit and income tax expense adjustment
In RMB
China Fangda Group Co., Ltd. 2014 Annual Report
|||
|-|-|
|Items|Amount occurred in the current period|
|Total profit|110,183,092.23|
|Income tax expense calculated by lawful/applicable tax rate|27,545,773.06|
|Impacts of different tax rates on subsidiaries|-13,527,919.55|
|Impacts of income tax in periods before adjustment|-1,537,060.30|
|Impacts of non-taxable income|-290,185.38|
|Impacts of non-deductible costs, expenses and losses|1,541,210.73|
|Impacts of using deductible loss with recognizing deferred||
||-764,290.33|
|income tax assets||
|Deductible temporary difference and deductable loss of||
||4,321,849.71|
|unrecognized deferred income tax assets||
|Others|204,369.63|
|Income tax expenses|17,493,747.57|

 49. Other miscellaneous income
See Note VII, 35.
50. Cash flow statement items
(1) Other cash inflow related to operation
In RMB
||||
|-|-|-|
|Items|Amount occurred in the current period|Occurred in previous period|
|Interest income|3,230,120.82|3,091,050.93|
|Subsidy income|2,134,243.86|12,041,679.00|
|Retrieving of deposits for exchange bills||174,858.62|
|Retrieving of bidding deposits|9,893,934.66|4,508,546.79|
|Other operating accounts|16,028,346.33|21,236,605.34|
|Total|31,286,645.67|41,052,740.68|

(2) Other cash paid related to operation
In RMB
||||
|-|-|-|
|Items|Amount occurred in the current period|Occurred in previous period|
|Sales expense|17,958,181.41|16,096,357.83|
|Administrative expense|38,615,205.18|39,553,659.77|
|Bidding deposit paid|868,076.30|9,952,466.34|

China Fangda Group Co., Ltd. 2014 Annual Report
||||
|-|-|-|
|Net draft deposit net paid|61,152,900.09|10,697,929.46|
|Other trades|14,978,873.55|14,449,566.74|
|Total|133,573,236.53|90,749,980.14|

(3) Other cash received related to investment activities
In RMB
||||
|-|-|-|
|Items|Amount occurred in the current period|Occurred in previous period|
|Bidding and contract deposit related to|||
||65,500.00|429,055.00|
|construction projects|||
|Total|65,500.00|429,055.00|

(4) Other cash paid related to investment activities
In RMB
||||
|-|-|-|
|Items|Amount occurred in the current period|Occurred in previous period|
|Bidding deposit paid related to|||
||331,500.00|1,659,058.00|
|construction projects|||
|Total|331,500.00|1,659,058.00|

(5) Other cash received related to financing: None
(6) Other cash paid related to financing: None
51. Supplementary data of cash flow statement
(1) Supplementary data of cash flow statement
In RMB
||||
|-|-|-|
|Supplementary information|Amount of the Current Term|Amount of the Previous Term|
|1. Net profit adjusted to cash flow of|||
||--|--|
|business operation|||
|Net profit|92,689,344.66|81,400,779.56|
|Plus: Asset impairment provision|27,438,026.33|33,783,118.67|
|Fixed asset depreciation, gas and petrol|||
||26,131,186.99|23,877,998.21|
|depreciation, production goods depreciation|||
|Amortization of intangible assets|3,670,872.39|3,920,173.92|
|Amortization of long-term amortizable|||
||1,336,953.32|1,362,450.83|
|expenses|||

China Fangda Group Co., Ltd. 2014 Annual Report
||||
|-|-|-|
|Loss from disposal of fixed assets, intangible|||
|assets, and other long-term assets (“-“ for|-1,453,847.27|410,730.16|
|gains)|||
|Loss from fixed asset discard (“-“ for gains)||51,823.92|
|Loss from fair value fluctuation (“-“ for|||
||-32,044,747.10|-16,647,859.74|
|gains)|||
|Financial expenses (“-“ for gains)|30,961,335.85|25,012,994.14|
|Investment losses (“-“ for gains)|-1,720,693.98|-300,866.92|
|Decrease of deferred income tax asset|||
||-10,202,800.67|-4,974,658.47|
|(“-“ for increase)|||
|Increase of deferred income tax asset (“-“ for|||
||9,077,672.93|4,446,477.57|
|increase)|||
|Decrease of inventory (“-“ for increase)|-523,064,898.18|-22,336,480.28|
|Decrease of operational receivable items|||
||-292,111,913.10|-198,931,167.94|
|(“-“ for increase)|||
|Increase of operational receivable items|||
||172,552,478.48|235,992,177.52|
|(“-“ for decrease)|||
|Others|-61,152,900.09|-10,523,070.84|
|Cash flow generated by business operations,|-557,893,929.44|156,544,620.31|
|net|||
|2. Major investment and financing operation|||
||--|--|
|not involving with cash|||
|3. Net change of cash and cash equivalents|--|--|
|Balance of cash at period end|102,638,232.19|285,237,255.38|
|Less: Initial balance of cash|285,237,255.38|240,167,372.86|
|Net increase in cash and cash equivalents|-182,599,023.19|45,069,882.52|

(2) Net cash obtained from subsidiaries in the period
In RMB
|||
|-|-|
||Amount|
|Related company and consolidated in paid cash or cash equivalent||
||36,000,000.00|
|in the period||
|Including:|--|
|Fangda SOZN|36,000,000.00|
|Less: Cash and cash equivalent held by the subsidiary on the||
||20,297,575.13|
|acquisition date||

China Fangda Group Co., Ltd. 2014 Annual Report
|||
|-|-|
|Including:|--|
|Fangda SOZN|20,297,575.13|
|Including:|--|
|Net cash obtained from the subsidiary|15,702,424.87|

(3) Net cash received from subsidiaries in the period: None
(4) Composition of cash and cash equivalents
In RMB
||||
|-|-|-|
|Items|Closing balance|Ending balance|
|I. Cash|102,638,232.19|285,237,255.38|
|Including: Cash in stock|40,733.33|33,975.32|
|Bank savings can be used at any time|102,515,874.25|285,145,634.33|
|Other monetary capital can be used at any|||
||81,624.61|57,645.73|
|time|||
|3. Balance of cash and cash equivalents at|102,638,232.19|285,237,255.38|
|end of term|||

52. Ownership or use right restricted assets
In RMB
||||
|-|-|-|
|Items|Closing book value|Reason|
|Monetary capital|109,792,566.68|Frozen deposit and cash deposit|
|Fixed assets|54,390,783.41|Loan by pledge|
|Investment real estate|198,513,586.15|Loan by pledge|
|Total|362,696,936.24|--|

Notes
(1) The above-mentioned monetary capital cannot be used at anytime and is not included in cash and cash equivalent in the cash flow statement.
(2) The restricted investment real estate is the Fangda Technology Building pledged to CCB Shenzhen OCT sub-branch.
53. Foreign currency monetary items
(1) Foreign currency monetary items
In RMB
China Fangda Group Co., Ltd. 2014 Annual Report
|||||
|-|-|-|-|
||||Exchanged RMB balance at the|
|Items|Foreign currency balance|Exchange rate||
||||end of the period|
|Monetary capital|--|--||
|Including: USB|386,114.22|6.1190|2,362,632.92|
|HK Dollar|9,876.04|0.78887|7,790.92|
|SGD|208,054.76|4.6396|965,290.86|
|Account receivable|--|--||
|Including: USB|6,150,218.83|6.1190|37,633,189.02|
|EUR|2,039,722.10|0.78887|1,609,075.57|
|SGD|17,312.18|4.6396|80,321.59|
|Financial assets measured at fair||||
|value with variations accounted||||
|into current income account||||
|Including: HK dollar|17,000,000.00|0.78887|13,410,790.00|
|Other receivables at the end of||||
|the period||||
|Including: USB|156,327.54|6.1190|956,568.22|

(2) No overseas operating entity
54. Hedging
Qualitative and quantitative information about hedging projects, tools and risks: None
VIII. Changes to consolidation scope
1. Consolidation of entities under common control
(1) Merger of companies not under the common control during the report period
In RMB
||||||||||
|-|-|-|-|-|-|-|-|-|
|||||||Acquisition|Income of|Net profit of|
|Acquired|Acquisition|||Acquisition|Acquisition|date|acquired|acquired|
|||Cost|Percentage||||||
|party|date|||method|date|determination|party during|party during|
|||||||basis|the period|the period|
|FangdaSOZN||||Monetary|September 1,2014|Controlpoweracquisitiondate|95,761,317.84|4,320,158.67|
||August 4,|||capital|||||
|||48,000,000.00|60.00%||||||
||2014|||acquisition|||||
|||||and injection|||||

Notes
China Fangda Group Co., Ltd. 2014 Annual Report (2) Consolidation cost and goodwill
|||
|-|-|
|Items|Fangda SOZN|
|Consolidation cost:||
|Cash|6,000,000.00|
|Or fair value with consideration|42,000,000.00|
|Total consolidation cost|48,000,000.00|
|Less: recognizable net asset fair value can be obtained|21,720,604.11|
|Goodwill|26,279,395.89|

 Notes:
Fangda New Energy and Shenzhen Jinma Yinke entered into a share transfer agreement. Fangda New Energy acquires60% of FangdaSOZN’s shares at RMB6 million to RMB48 million. The final amount depends on FangdaSOZN’s performance over the next three years (July-December 2014, 2015 and 2016). The stock transfer amount is up to RMB18 million. The Company shall pay the amount to Luo Huichi in three installments: The first installment of RMB 6million shall be paid after both parties sign the stock transfer agreement, complete the transfer and registration procedures, and the Company holds60% of the TargetCompany’s stocks. The second installment of RMB 6million shall be paid after the Target Company realizes90% or higher of the sales or net profit target for 2014 (between July and December); the first installment of RMB6 million will be paid after the Target Company realizes90% or higher of the sales or net profit target for 2015. If the conditions for the second and third installments are not met, the Company does not need to pay the stock transfer amounts to the Counterpart and the60% shareholding of the Target Company by the Company remains unchanged.
The Company will provide interest-free loans of RMB30 million to the Target Company with a mature date of December 31, 2016 after the share transfer agreement is signed, both parties complete the commercial and industrial registration, the Company holds60% of the TargetCompany’s shares. If the Target Company completes90% of the sales target or accumulative net profit target between July 2014 and December 2016, the loans will be transferred to the acquisition payment of60% of the Target Company and the Target Company does not need to repay the loans. Otherwise, Luo Huichi shall transfer30% of the TargetCompany’s shares held by her to the Company at the price of RMB1/share.
The Group forecasts that Fangda SOZN will fulfill the performance target over the next three years. Therefore, the acquisition cost may reach RMB42 million.
Reason for large-amount goodwill:
See (2) Consolidation cost and goodwill
Notes
None
(3) Recognizable assets and liabilities of acquired party on acquisition date
Fair value and book value of FangdaSOZN’s recognizable assets and liabilities on the acquisition date:
China Fangda Group Co., Ltd. 2014 Annual Report
||||
|-|-|-|
|Items||Fangda SOZN|
||Current asset||
||Non-current assets||
||Including: other intangible assets||
||Including: fixed assets||
||Current liabilities||
||Non-current liabilities||
||Net assets||
||Less: minor shareholders’ equity||
||Net assets obtained from consolidation||

Determination method of the fair value of recognizable assets and liabilities
None
Notes
None
2. Changes to the consolidation scope with other reasons
Other reasons that cause changes to the consolidation scope and related information
Fangda New Energy and Shihui International Holding were established and consolidated in the period.
Fangda Yi was liquidated in the period and removed from consolidate statements.
IX. Interests in Other Entities
1. Interest in subsidiaries
(1) Composition of the group
||||||||
|-|-|-|-|-|-|-|
||Operating|Registered||Shareholding||Acquisition|
|Company|||Business||||
||location|address||Direct|Indirect|method|
||||Designing,||||
||||manufacturing,||||
|Fangda Jianke|Shenzhen|Shenzhen||98.39%|1.61%|Established|
||||and installation of||||
||||curtain walls||||
||||Installation and||||
|Fangda|||||||
||Shenzhen|Shenzhen|processing of|94.08%|5.92%|Established|
|Automatic|||||||
||||metro screen door||||
|Fangda New|||Production and||||
||Nanchang|Nanchang||75.00%|25.00%|Established|
|Material|||sales of new-type||||

China Fangda Group Co., Ltd. 2014 Annual Report
|||||||
|-|-|-|-|-|-|
||||materials|||
||||composite|||
||||materials and|||
||||production of|||
||||curtain walls|||
||||Design,|||
||||production, sales|||
||||and installation of|||
||||curtain wall|||
|Fangda||||||
||Nanchang|Nanchang|aluminum|100.00%|Established|
|Aluminium||||||
||||materials, doors,|||
||||windows and|||
||||sectional|||
||||materials|||
|HK Junjia|Hong Kong|Hong Kong|Investment|100.00%|Established|
||||Manufacturing of|||
||||semiconductor|||
||||lighting material|||
||||and chips;|||
||||lighting source|||
||||encapsulation;|||
||||developing,|||
|Shenyang Fangda|Shenyang|Shenyang||64.58%|Established|
||||designing,|||
||||manufacturing,|||
||||engineering,|||
||||installation and|||
||||trading of|||
||||semiconductor|||
||||lighting system|||
||||Developing of|||
||||hardware and|||
||||software, system|||
|Kexunda|Shenzhen|Shenzhen||100.00%|Established|
||||integration,|||
||||technical|||
||||consulting|||
||||Real-estate|||
||||development and|||
|Fangda Property|Shenzhen|Shenzhen|operation;|100.00%|Established|
||||property|||
||||management|||
|Fangda New|||Design and|||
||Shenzhen|Shenzhen||100.00%|Established|
|Energy|||construction of|||

China Fangda Group Co., Ltd. 2014 Annual Report
||||||||
|-|-|-|-|-|-|-|
||||PV power plants||||
||||Trusted||||
||||processing of||||
|Chengdu Fangda|Chengdu|Chengdu|||100.00%|Established|
||||building curtain||||
||||wall materials||||
|Shihui|||||||
|International|Virgin Islands|Virgin Islands|Investment|100.00%||Established|
|Holding Co., Ltd.|||||||
||||Installation and||||
|Dongguan New|||||||
||Dongguan|Dongguan|sales of building||100.00%|Established|
|Material|||||||
||||curtain walls||||
||||Designing,||||
|Shenyang|||manufacturing,||||
||Shenyang|Shenyang|||100.00%|Established|
|Decoration|||and installation of||||
||||curtain walls||||
||||Installation of||||
||||LED color curtain|||Under different|
|Shenzhen Woke|Shenzhen|Shenzhen|||64.58%||
||||wall, city and|||control|
||||road lamps||||
||||Production and||||
|||||||Under different|
|Fangda SOZN|Zhongshan|Zhongshan|sales of lights and||60.00%||
|||||||control|
||||LED products||||
||||R&D, design and||||
||||production of||||
|Fangda Yide|Shenzhen|Shenzhen|new-type|75.00%|25.00%|Established|
||||composite||||
||||materials||||

(2) Important partially-owned subsidiaries
In RMB
||||||
|-|-|-|-|-|
|||||Minority shareholder|
||Minority shareholding|Gain/loss attributed to|Dividends distributable||
|Company||||equity balance at the end|
||percentage|minority shareholders|to minority shareholders||
|||||of the period|
|Shenyang Fangda|35.42%|-5,803,503.04|0.00|52,387,418.95|
|Fangda SOZN|40.00%|1,728,063.47|0.00|16,208,466.21|

 (3) Financial information of important partially-owned subsidiaries
In RMB
||||
|-|-|-|
|Compan|Closing balance|Ending balance|

China Fangda Group Co., Ltd. 2014 Annual Report
||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|
|y||Non-curr|||Non-curr|||Non-curr|||Non-curr||
||Current||Total ofassets|Current||Total|Current||Total of|Current||Total|
|||ent|||ent|||ent|||ent||
||asset|||liabilities||liabilities|asset||assets|liabilities||liabilities|
|||assets|||liabilities|||assets|||liabilities||
|Shenyan|11,169,3|102,807,|113,977,|25,118,9||25,118,9|13,573,8|110,103,|123,677,|18,434,2||18,434,2|
|g Fangda|16.98|842.68|159.66|35.62||35.62|15.84|435.92|251.76|08.29||08.29|
|Fangda|98,422,1|24,060,4|122,482,|111,961,||111,961,|||||||
|SOZN|61.21|01.24|562.45|396.93||396.93|||||||

In RMB
||||||||||
|-|-|-|-|-|-|-|-|-|
||Amount occurred in the current period||||Occurred in previous period||||
|||||Cash flow||||Cash flow|
|Company|||Total of misc.|from|||Total of misc.incomes|from|
||Turnover|Net profit|||Turnover|Net profit|||
||||incomes|operating||||operating|
|||||activities||||activities|
|Shenyang||-16,384,819.4|-16,384,819.4|||-11,845,430.1|-11,845,430.1||
|||||-95,859.16|-850,952.79|||-285,099.80|
|Fangda||3|3|||4|4||
|Fangda|95,761,317.84|||-13,259,799.7|||||
|||4,320,158.67|4,320,158.67||||||
|SOZN||||3|||||

2. Interest in joint venture arrangement or affiliates
Financial information of no longer important affiliate
Closing amount/this Opening amount/last Item
period period Affiliate
Total book value of investment 11,048,660.43 9,994,565.55 Total of the shareholding of the following
items
Net profit 1,058,094.88 -5,434.45 Other misc. income
Total misc. income 1,058,094.88 -5,434.45 X. Financial Tools and Risk Management
Details about the Group's financial instruments are disclosed in related notes. The following explains risks related to the financial instruments and risk management policies adopted by the Group to lower the risks. The management of the Group manages and monitor the risks to ensure that the risks are within the acceptable range.
1. Risk management target and policy
China Fangda Group Co., Ltd. 2014 Annual Report The taget of the risk management is to balance between risk and benefit and lower financialrisks’ impacts on theGroup’s financial performance. Based on the target, the Group has formulated risk management policy to identify and analyze risks facing the Group and set an appropriate acceptable level and internal control procedures to monitor the risks. The Group regularly reviews the risk management policies and related internal control system to suit the market status and changes in theGroup’s operating activities. The internal auditing department of the Group will regularly or randomly check the implementation of the internal control system.
Risks caused by theGroup’s financial instruments are interest risk, exchange rate risk, credit risk and liquidity risk.
(1) Market risk
Market risk of financial instrument is caused by changes in the fair value of financial instruments or future cash flow, including interest risk, exchange rate and other price risks.
Interest rate risk
Interest rate risk is caused by fluctuation of the fair value or future cash flow of financial instruments caused by changes in the market interest rate. The interest rate risk can be caused by recognized interest-bearing financial instruments and unrecognized financial instruments.
The Group's interest rate risk is mainly caused by short-term borrowings. Financial liabilities with floating interest rate cause cash flow interest rate risk for the Group. Financial liabilities with fixed interest rate cause fair value interest rate risk for the Group. The Group decides the proportion between fixed interest rate and floating interest rate according to the market environment and regularly reviews and monitors the combination of fixed and floating interest rate instruments. On December 31, 2014, if the interest rate of borrowings with floating interest rates rises or drops 50 base points, the net profit of the Group andshareholders’ interest will decrease or increase about RMB30,694.44.
Exchange rate risk
Exchange rate risk is caused by fluctuation of the fair value or future cash flow of financial instruments caused by changes in the foreign exchange rates. The exchange rate risk can be caused by financial instruments priced in foreign currencies.
The Group mainly operates in China and use RMB as the settlement currency. Therefore, the exchange rate risk facing the Group is minor.
See foreign currency item note for theGroup’s financial assets and liabilities priced in foreign currencies.
(2) Credit risk
Credit risk is caused by the failure of one party of a financial instrument in performing its obligations, causing the risk of financial loss for the other party.
The Group manages credit risks through classification. The credit risk is mainly caused by bank
China Fangda Group Co., Ltd. 2014 Annual Report deposit and receivables.
TheGroup’s bank deposit is mainly deposited in state-owned banks and large-sized listed banks. The credit risk caused by bank deposited is minor.
For receivables, the Group sets up related policies to control the credit risk. The Group set the credit line and term for debtors according to their financial status, external rating, and possibility of getting third-party guarantee, credit record and other factors. The Group regularly monitorsdebtors’ credit record. For those with poor credit record, the Group will send written payment reminders, shorten or cancel credit term to lower the general credit risk.
The largest credit risk facing the Group is the book value of each financial asset on the balance sheet. The Group makes no guarantee that may cause the Group credit risks.
Among theGroup’s receivables, accounts receivable from top 5 customers account for11.26% of the total accounts receivable (2013:15%); among other receivables, other receivables from top 5 customers account for27.06% of the total other receivables (2013:23.49%).
(3) Liquidity risk
Liquidity risk is the risk of capital shortage when the Group needs to pay cash or settled with other financial assets.
The Group keeps adequate cash and cash equivalent, and monitors the level to ensure that the cash and cash equivalent can meet the operation needs. The management of the Group monitors the use of bank loans and ensures that they are used as agreed. The Group also obtains guarantee from financial institutions for adequate standby fund to meet short-term and long-term capital demand. The Group can also use fund generated by operating activities and bank and other loans. On December 31, 2014, bank loan credit that the Group has not used was RMB1,046,395,900.
Financial liabilities and excluded guarantees held by the Group by undiscounted residual contract cash flow (in RMB10,000) at the end of the period:
||||||
|-|-|-|-|-|
||Closing amount||||
|Assets|||||
||Less than 1 year|Within 1-3 years|Over 3 years|Total|
|Financial liabilities:|||||
|Short-term loans|110,000.00|||110,000.00|
|Notes payable|22,726.65|||22,726.65|
|Account payable|68,359.80|25.50|125.53|68,510.83|
|Interest payable|205.59|||205.59|
|Other payables|4,535.77|206.80||4,742.57|
|Non-current liabilities due in 1 year|600.00|||600.00|
|Long-term payable||600.00||600.00|

China Fangda Group Co., Ltd. 2014 Annual Report
||||||
|-|-|-|-|-|
|Total liabilities|206,427.81|832.30|125.53|207,385.64|

 Financial liabilities and excluded guarantees held by the Group by undiscounted residual contract cash flow (in RMB10,000) at the beginning of the period:
||||||
|-|-|-|-|-|
||Opening amount||||
|Assets|||||
||Less than 1 year|Within 1-3 years|Over 3 years|Total|
|Financial liabilities:||||-|
|Short-term loans|36,900.00|||36,900.00|
|Notes payable|18,857.09|||18,857.09|
|Account payable|48,921.61|||48,921.61|
|Interest payable|68.92|||68.92|
|Other payables|2,815.24|1,353.52||4,168.76|
|Total liabilities|107,562.86|1,353.52||108,916.38|

 2. Capital management
TheGroup’s capital management aims to ensure continuous operation of the Group, provide returns for shareholders, help other interested parties make benefit, and maintain the best capital structure and lower capital cost.
The Group may adjust the dividend distributed to shareholders, issue new shares or sell assets to maintain or adjust the capital structure.
The Group monitors the capital structure based on the assets/liability ratio. On December 31, 2014, theGroup’s assets/liability ratio is64.49% (December 31, 2013:53.22%).
XI. Disclosure of fair value
1. Closing fair value of assets and liabilities measured at fair value
In RMB
||||||
|-|-|-|-|-|
||Closing fair value||||
|Items|||||
||First level fair value|Second level fair value|Third level fair value|Total|
|1. Continuous fair value|||||
||--|--|--|--|
|measurement|||||
|(2) Investment in equity|||||
||13,410,790.00|||13,410,790.00|
|tools|||||
|2. Leased building||198,513,586.15||198,513,586.15|
|Total assets measured at|||||
||13,410,790.00|198,513,586.15||211,924,376.15|
|fair value continuously|||||
|2. Discontinuous fair|||||
||--|--|--|--|
|value measurement|||||

China Fangda Group Co., Ltd. 2014 Annual Report 2. Determination basis for continuous and discontinuous first level fair value measurement
The Group determines the fair value using quotation in an active market for financial instruments traded in an active market;
3. Continuous and discontinuous second level fair value measurement items, valuation techniques, important qualitative and quantitative information
For investment in real estate similar with real estate transaction, the Group uses valuation techniques to determine its fair value. The technique is comparison method. Inputs include transaction date, status, region and other factors.
4. Continuous fair value measurement items, switch between different levels, reason and switching policies In the period, there is no switch in the financial assets measured at fair value between the first and second level or transfer in or out of the third level.
5. Change in valuation technique and reason
None
6. Fair value of financial assets and liabilities not measured at fair value
The difference between book value and fair value of financial assets and liabilities not measured at fair value is small.
7. Others
None
XII. Related parties and transactions
1. Parent of the Company
|||||||
|-|-|-|-|-|-|
|||||Share of the parent|Voting power of the|
|Parent|Registered address|Business|Registered capital|||
|||||co. in the Company|parent company|
|Shenzhen Banglin||||||
|Technologies||||||
||Shenzhen|Industrial investment|RMB30 million|9.09%|9.09%|
|Development Co.,||||||
|Ltd.||||||
|Shenzhen Shilihe||||||
||Shenzhen|Industrial investment|19,780,992|2.36%|2.36%|
|Investment Co., Ltd.||||||
|Shengjiu Investment||||||
||Hong Kong|Industrial investment|HKD1.00|5.00%|5.00%|
|Ltd.||||||

China Fangda Group Co., Ltd. 2014 Annual Report Particulars about the parent of the Company
1. All of the investors of Shenzhen Banglin Technology Development Co., Ltd.– the holding shareholder of the Company, are natural persons. Among them, Chairman Xiong Jianming is holding85% of the shares, and Mr. Xiong Xi– son of Mr. Xiong Jianming, is holding15% of the shares.
2. Among the top 10 shareholders, Shenzhen Banglin Technology Development Co., Ltd. and Shengjiu
Investment Co., Ltd. are parties action-in-concert. Shenzhen Banglin Technology Development Co., Ltd. and Shenzhen Shilihe Investment Co., Ltd. are related parties. The Company is not notified of other
action-in-concert or related parties among the other holders of current shares.
The final controller is Xiong Jianming.
2. Subsidiaries of the Company
See Note IX, 1 for the details.
XIII. Contingent events
1. Contingencies
(1) Contingencies on the balance sheet date
(1) Contingent liabilities formed by material lawsuit or arbitration, and their influences on the financial position
|||||||
|-|-|-|-|-|-|
|Plaintiff|Defender|Case|Court|Target|Progress|
|||||amount||
|Wang Weihong|Fangda Jianke|Engineeringdispute|The 1st MiddleCourt ofChongqing|RMB17.07million and itsinterest|Trial of secondinstance|

In 2010, Wang Weihong filed a lawsuit to the
1st
Middle Court of Chongqing against Fangda Jianke, demanding engineering payment and loss of RMB17.07 million and interest. On June 19, 2014, the court made the first-instance judgment (201) Yu
1st
Court No.00128. Fangda Jianke is required to pay RMB14,015,908.19 and interest to Wang Weihong in 10 days upon the effectiveness of the judgment and refund deposit of RMB1,655,000.00 and interest to Wang Weihong. Fangda Jianke appeal to Chongqing SeniorPeople’s Court. The second trial is in progress on the report date. Fangda Jianke has made liability provision of RMB5.039 million according to the judgment of the first trial. Fangda Jianke also filed a lawsuit against Wang Weihong and demanded an engineering payment and compensation of RMB18 million An amount of RMB12 million in the bank account of Fangda Jianke has been frozen by the court.
(2) Important contingencies thatdon‟t need to be disclosed but need to be explained
None
China Fangda Group Co., Ltd. 2014 Annual Report 2. Others: None
XIV. Post-balance-sheet events
1. Important non-adjustment item: None
2. Profit distribution
In RMB
|||
|-|-|
|Profit or dividend to be distributed|22,707,297.10|
|Profit or dividend approved to be distributed||

3. Sales return: None
4. Notes to other issues in post balance sheet period: None
XV. Other material events
1. Suspended business
In RMB
||||||||
|-|-|-|-|-|-|-|
|||||||Net profit|
|||||Income tax||attributable to the|
|Items|Income|Expense|Total profit||Net profit||
|||||expenses||owners of parent|
|||||||company|
|Suspend business|||||||
||3,195,855.07|17,153,885.09|-13,958,030.02||-13,958,030.02|-7,920,881.45|
|revenue|||||||

Notes
(1) Shenyang Fangda has been suspended from operating since 2012 and is in the liquidation process. Shenzhen Woke has been liquidated according to the resolution of theShareholders’ Meeting, the company's business has been suspended. Fangda Yide was liquidated in 2014. Fangda Aluminium has been suspended from operating since 2011 and is in the liquidation process.
(2) The net profit from suspended business in 2014 includes: the net project of RMB-17,044,462.38 of Shenyang Fangda and its subsidiaries, RMB158,530.86 of Fangda Yide and RMB2,927,901.50 of Fangda Aluminium. (3) The net profit from suspended business in 2013 includes: the net project of RMB-12,072,513.31 of Shenyang Fangda and its subsidiaries, RMB158,530.86 of Fangda Yide and RMB2,927,901.50 of Fangda Aluminium.
China Fangda Group Co., Ltd. 2014 Annual Report 2. Segment information
(1) Reporting segment determination basis and accounting policy
The Group divides its businesses into five reporting segments. The reporting segments are determined based on financial information required by routine internal management. TheGroup’s management regularly review the operating results of the reporting segments to determine resource distribution and evaluate their performance. The reporting segments are:
(1) Curtain wall segment, production and sales of curtain wall materials, construction curtain wall design, production and installation;
(2) Rail transport segment, assembly and processing of metro screen doors;
(3) Real estate segment, development and operating of real estate on land of which land use right is legally obtained by the Company; property management;
(4) New energy segment,R&D, installation and sales of PV devices, design and construction of PV power plants;R&D, design, production, sales and installation of light accessories, and other lights, LED products and hardware. (5) Others
The segment report information is disclosed based on the accounting policies and measurement standards used by the segments when reporting to the management. The policies and standards should be consistent with those used in preparing the financial statement.
(2) Financial information of reporting segments
(1) Segment profit or loss, assets and liabilities
|||||||||
|-|-|-|-|-|-|-|-|
|This period or end of this|Curtain wall|Rail transport|Real estate|New energy|Others|Offset|Total|
|period||||||||
|Turnover|1,661,248,718.96|164,055,611.07|2,013,839.96|95,761,317.84|29,609,371.13|14,364,423.45|1,938,324,435.51|
|Including: externaltransaction income|1,656,916,307.20|163,281,339.00||95,761,317.84|22,365,471.47||1,938,324,435.51|
|Inter-segmenttransaction income|4,332,411.76|774,272.07|2,013,839.96||7,243,899.66|14,364,423.45|-|
|Including: majorbusiness turnover|1,647,897,816.63|160,427,755.07||92,516,175.40||4,308,171.64|1,896,533,575.46|
|Operation cost|1,391,336,171.77|118,320,893.63|-|80,611,629.14|5,669,281.13|5,101,189.65|1,590,836,786.02|
|Including: majorbusiness cost|1,384,070,778.59|116,907,821.10||77,403,664.46||5,250,618.98|1,573,131,645.17|
|Business expense|188,366,206.12|26,148,333.72|5,023,251.58|10,224,044.08|-15,730,365.23|-28,930,834.07|242,962,304.34|
|Operating profit/(loss)|81,546,341.07|19,586,383.72|-3,009,411.62|4,925,644.62|39,670,455.23|38,194,067.87|104,525,345.15|
|Total assets|2,696,787,412.01|403,424,853.36|875,469,981.13|212,477,809.8|2,012,145,066.90|2,537,585,222.82|3,662,719,900.41|

China Fangda Group Co., Ltd. 2014 Annual Report
|||||||||
|-|-|-|-|-|-|-|-|
|||||3||||
|Total liabilities|1,828,471,033.63|213,625,244.55|678,400,713.51|94,316,598.44|771,716,371.36|1,224,344,689.07|2,362,185,272.42|
|Last period or end of last|Curtain wall|Rail transport|Real estate|New energy|Others|Offset|Total|
|period||||||||
|Turnover|1,615,770,830.70|109,386,493.23|686,160.04||44,439,832.54|22,662,470.77|1,747,620,845.74|
|Including: externaltransaction income|1,614,569,290.76|98,493,487.64|||34,558,067.34||1,747,620,845.74|
|Inter-segmenttransaction income|1,201,539.94|10,893,005.59|686,160.04||9,881,765.20|22,662,470.77||
|Including: majorbusiness turnover|1,602,159,942.22|97,497,470.54||||1,928,835.57|1,697,728,577.19|
|Operation cost|1,345,014,568.09|84,836,442.32|||10,834,093.34|15,315,899.33|1,425,369,204.42|
|Including: majorbusiness cost|1,339,429,169.22|74,237,530.43||||841,469.94|1,412,825,229.71|
|Business expense|189,120,439.96|15,672,530.75|1,245,190.31||24,421,736.04|2,607,315.96|227,852,581.10|
|Operating profit/(loss)|81,635,822.65|8,877,520.16|-559,030.27||9,184,003.16|4,739,255.48|94,399,060.22|
|Total assets|2,093,240,742.30|355,159,698.99|360,666,929.02||1,660,494,495.61|1,870,004,323.35|2,599,557,542.57|
|Total liabilities|1,486,596,070.19|154,191,112.44|311,112,848.14||433,684,819.46|1,002,099,485.40|1,383,485,364.83|

 (2) Others
① Product and external labor transaction income
||||
|-|-|-|
|Items|Amount occurred in the current|Occurred in previous period|
||period||
|Metal production|1,643,589,644.97|1,600,231,106.65|
|Railroad industry|160,427,755.09|97,497,470.54|
|Light production|92,516,175.40||
|Total|1,896,533,575.46|1,697,728,577.19|

②Regional information
Since more than90% of theGroup’s revenue comes from Chinese customer and90% of theGroup’s assets are in China, no detailed regional information is needed.
3. Other significant transaction and items with impacts on investors
1. Acquisition of shares of Fangda SOZN
(1) About the acquisition
Fangda New Energy entered into an investment agreement with Luo Huichi on July 18, 2014. According to the
agreement, Fangda Energy and Shenzhen Jinma Yinke entered into a share transfer agreement on July 29, 2014.
The transaction does not constitute a related transaction or material asset restructuring. Therefore, the transaction
China Fangda Group Co., Ltd. 2014 Annual Report does not need to be submitted to the Board of Directors for discussion according to theCompany’s Articles of Association.
Content of the investment and share transfer agreement:
1. Terms of the transaction
Luo Huichi makes contribution to a newly established company with limited liability using fixed assets, intangible assets, sales network and teams in three companies under her actual control: Zhongshan SOZN Lighting, Zhongshan Henglan Tengding Lighting Factory, Shenzhen Jinma Yinke. The new company is named as Guangdong Fangda SOZN Lighting Co., Ltd. (hereinafter referred to as Target Company). After confirming the TargetCompany’s assets, both parties entered into the stock transfer and capital increment agreement, under which the Company acquires60% stack in the Target Company by acquiring stocks and injecting capital.
2. Transaction amount
The acquisition amount does not exceed RMB48 million, including a conditional payment to Luo Huichi of RMB18 million and a conditional capital injection to the Target Company of RMB30 million.
3. Payment term
The stock transfer amount is up to RMB18 million. The Company shall pay the amount to Luo Huichi in three installments: The first installment of RMB 6million shall be paid after both parties sign the stock transfer agreement, complete the transfer and registration procedures, and the Company holds60% of the TargetCompany’s stocks. The second installment of RMB 6million shall be paid after the Target Company realizes90% or higher of the sales or net profit target for 2014 (between July and December); the first installment of RMB6 million will be paid after the Target Company realizes90% or higher of the sales or net profit target for 2015. If the conditions for the second and third installments are not met, the Company does not need to pay the stock transfer amounts to the Counterpart and the60% shareholding of the Target Company by the Company remains unchanged.
The Company will provide interest-free loans of RMB30 million to the Target Company with a mature date of December 31, 2016 after the share transfer agreement is signed, both parties complete the commercial and industrial registration, the Company holds60% of the TargetCompany’s shares. If the Target Company completes90% of the sales target or accumulative net profit target between July 2014 and December 2016, the loans will be transferred to the acquisition payment of60% of the Target Company and the Target Company does not need to repay the loans. Otherwise, Luo Huichi shall transfer30% of the TargetCompany’s shares held by her to the Company at the price of RMB1/share.
4. Result guaranty
||||
|-|-|-|
|Period|Target sales (tax-inclusive)|Target net profit|
|July to December, 2014|RMB150 million|RMB3 million|
|July to December, 2015|RMB600 million|RMB36 million|
|July to December, 2016|RMB1 billion|RMB60 million|
|Total|RMB1.75 billion|RMB99 million|

5. Special agreement
China Fangda Group Co., Ltd. 2014 Annual Report Luo Huichi agrees to sign a three-year labor contract, non-disclosure agreement and non-competition agreement with the Target Company and agrees not to be involved in the same or similar business directly, indirectly, paid or not paid, full-time or part-time, by starting a company or cooperating with others. If Luo fails to honor the guaranty, the Company has the right to terminate the agreement and require Luo to return the stock transfer amount and bear the liability of the breach.
Both parties agree that the Target Company will not distribute profit between July 2014 and December 2016, which will be fully used to push the development of the Target Company.
(2) Performance in 2014
Between July and December 2014, Fangda SOZN recorded a tax-included income of RMB136,832,908.41 and net profit of RMB521,165.52, reaching90% of the sales target for 2014. Fangda New Energy made the second installment of RMB6 million to Shenzhen Jinma Yinke.
2. Private share issuance
TheGroup’s private share issuance proposal was approved at the
8th
meeting of the
7th
Board of Directors held on December 23, 2014. The shares will be issued privately to specific subscribers. The Company will issue shares to no more than 10 specific subscribers including theCompany’s largest shareholder Shenzhen Banglin Technologies Development Co., Ltd. (Banglin Technology) when appropriate within 6 months upon approval by CSRC. RMB common shares (A-shares) will be issued this time with a par value of RMB1.00. A-shares issued this time will not be more than 105,000,000 million shares (inclusive). In case ex-dividend or ex-interest events happened during the period from pricing ex-day to issuing day, such as dividend distribution, bonus shares, or capitalizing of common reserves, the amount shall be adjusted correspondingly. The finally issued amount will be determined by the Board of Directors authorized by theShareholders’ Meeting and the sponsor (major underwriter) according to regulations and actual conditions. The shares will be issued to no more than 10 specific subscribers including theCompany’s largest shareholder Banglin Technology, which will subscribe for the shares with RMB201,600,000 (accounting for20% of the maximum raised amount of RMB1,008,000,000 of the private issuing). The subscribers shall subscribe for the shares in cash. The other subscribers are no more than nine specific investors including eligible securities investment fund management companies, securities companies, trust investment companies, financial companies, insurance institutional investors, eligible overseas institutional investors, other domestic corporate investors and natural persons according to CSRC. Two or more fund subscribers managed by one securities investment fund management company are one subscriber. A trust company subscriber shall subscribe the shares with its own fund.
The pricing ex-date will be the day when the announcement of resolutions of the 8th meeting of the 7th Board of Directors. The price will be90% of the average price in 20 days prior to the pricing ex-date, namely RMB9.85 per share. The average price in 20 days prior to the pricing ex-date= total dealing amount in the days prior to the pricing ex-date/total number of shares dealt in the 20 days prior to the pricing ex-date. In case ex-dividend or ex-interest events happened during the period from pricing ex-day to issuing day, such as dividend distribution, bonus shares, or capitalizing of common reserves, the price shall be adjusted according to the following formula:
Assume that the base issuing price before adjustment is P0, N share(s) is distributed for each share, D is distributed as cash dividend for each share, the base issuing price after adjustment is P1 (the figure is rounded to
China Fangda Group Co., Ltd. 2014 Annual Report two decimal places when the number is larger than 4):
Cash dividend:P1=P0－D
Share dividend or transfer of capital to shares:P1=P0/(1+N)
Both:P1=(P0-D)/(1+N)
The final issuing price is to be determined by the Board of Directors and sponsor (principal underwriter) according to the price priority principle based on the investor subscription price after the Board of Directors receives approval of the issuance from CSRC with the authorization by theShareholders’ Meeting. Banglin Technology does not participate in the market enquiry process and agrees to accept the bidding result and subscribe for the shares with other investors at the same price. Where no other investors bid, the subscription price for Banglin Technology will be the base issuing price.
Shares subscribed by Banglin Technology at this private issuing are not allowed to be transferred in 36 months since the closing day of this private issuing. Shares subscribed by other investors at this private issuing are not allowed to be transferred in 12 months since the closing day of this private issuing.
Upon accomplishing of the issuing, the new shareholders will share the retained profit in the previous years along with the existing shareholders.
3. Assets and liabilities measured at fair value
(1) Assets of the Group measured at fair value are investment real estate and financial assets measured at fair value and change including the gain of the current period. Investment real estate's fair value is adjusted when necessary using quotation of similar asset in an active market or same or similar asset in an inactive market. The closing value is RMB198,513,586.15; financial assets measured at fair value and of which changes are including in gain/loss in the current period, the fair value is determined by quotation in an active market. The closing value is RMB13,410,790.00. (2) Assets measured at fair value
Accumulative
changes in fair
Gain/loss
value
caused by Provision
Items Opening amount accounting Closing amount changes in Impairment
into the
fair value
income
account
34,897,632.1 91,831.6 198,513,586.1 Investment real estate 174,778,756.62
0 3 5 Financial assets
measured at fair
value with
variations -2,852,885.00 13,410,790.00 accounted into
current income
account
China Fangda Group Co., Ltd. 2014 Annual Report XVI. Notes to Financial Statements of the Parent
1. Account receivable
(1) Account receivable are disclosed by categories
In RMB
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
||Closing balance|||||Ending balance|||||
||||Bad debt provisionbalance at the endof the period|||||Bad debt provision|||
||Remaining book|||||Remaining book|||||
|||||||||balance at the end of|||
|Type|value||||Book|value|||||
|||||||||the period||Book value|
||||||value||||||
|||Proportio||Provisionrate|||Proportio||Provision||
||Amount||Amount|||Amount||Amount|||
|||n|||||n||rate||
|Recognition and|||||||||||
||527,485.15||15,824.5||511,660.6|623,154|||||
|providing of bad debt||100.00%||3.00%|||100.00%|18,694.62|3.00%|604,459.49|
||||5||0|.11|||||
|provisions on groups|||||||||||
||527,485.15||15,824.5||511,660.60|623,154||||604,459.49|
|Total||100.00%||3.00%|||100.00%|18,694.62|3.00%||
||||5|||.11|||||

Account receivable with major individual amount and bad debt provision provided individually at the end of the period:
□ Applicable√ Inapplicable
In the group, the account receivable of which bad debt provision is made through the account aging method:√ Applicable□ Inapplicable
In RMB
|||||
|-|-|-|-|
||Closing balance|||
|Age||Bad debt provision balance atthe end of the period||
||Account receivable||Provision rate|
|Items less than 1 year||||
|Less than 1 year|527,485.15|15,824.55|3.00%|
|Subtotal for less than 1 year|527,485.15|15,824.55|3.00%|
|Total|527,485.15|15,824.55|3.00%|

Note:
Account receivable adopting the balance percentage method in the group:
□ Applicable√ Inapplicable
(2) Bad debt provisions made, recovered or reversed in this period
Bad debt provisions of RMB-2,870.07 were made in this period; none was recovered or reversed in this period.
China Fangda Group Co., Ltd. 2014 Annual Report (3) Top 5 account receivable entities at the end of the period
The total balance of accounts receivable due from top 5 account receivable entities at the end of the period is RMB348,543.92, accounting for66.08% of the aggregate. Bad debt provisions made totaled RMB10,456.32 at the end of the period.
2. Other receivables
(1) Other receivables are disclosed by categories
In RMB
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
||Closing balance|||||Ending balance|||||
||||Bad debt provisionbalance at the endof the period|||||Bad debt provision|||
||Remaining book|||||Remaining book|||||
|||||||||balance at the end of|||
|Type|value||||Book|value|||||
|||||||||the period||Book value|
||||||value||||||
|||Proportio||Provisionrate|||Proportio||Provision||
||Amount||Amount|||Amount||Amount|||
|||n|||||n||rate||
|Recognition and|||||||||||
||255,152,639.18||548,475.||254,604,1|572,239||619,111.5||571,620,65|
|providing of bad debt||99.97%||0.21%|||99.99%||0.11%||
||||39||63.79|,771.28||5||9.73|
|provisions on groups|||||||||||
|Account receivable|||||||||||
|with minor individual|||||||||||
||77,046.00||77,046.0|||77,046.|||||
|amount and bad debt||0.03%||100.00%|||0.01%|77,046.00|100.00%||
||||0|||00|||||
|provision provided|||||||||||
|individually|||||||||||
||255,229,685.18||625,521.||254,604,163.79|572,316||696,157.5||571,620,659.73|
|Total|||||||||||
||||39|||,817.28||5|||

 Other receivables with major individual amount and bad debt provision provided individually at the end of the period:
□ Applicable√ Inapplicable
In the group, the other receivables of which bad debt provision are made through the account aging method:√ Applicable□ Inapplicable
In RMB
|||||
|-|-|-|-|
||Closing balance|||
|Age|Other receivables at the end of|Bad debt provision balance at||
||||Provision rate|
||the period|the end of the period||
|Items less than 1 year||||
|Less than 1 year|68,253.65|2,047.61|3.00%|
|Subtotal for less than 1 year|68,253.65|2,047.61|3.00%|
|1-2 years|35,000.00|3,500.00|10.00%|

China Fangda Group Co., Ltd. 2014 Annual Report
|||||
|-|-|-|-|
|2-3 years|46,753.35|14,026.01|30.00%|
|Over 3 years|1,057,803.54|528,901.77|50.00%|
|Total|1,207,810.54|548,475.39|45.41%|

Note:
Other receivables adopting the balance percentage method in the group:
□ Applicable√ Inapplicable
Other receivables adopting other methods in the group:
□ Applicable√ Inapplicable
(2) Bad debt provisions made, recovered or reversed in this period
Bad debt provisions of RMB-70,636.16 were made in this period; none was recovered or reversed in this period.
(3) Other receivables disclosed by nature
In RMB
||||
|-|-|-|
|By account|Closing balance of book value|Opening balance of book value|
|Payments between counterparts|253,944,828.64|570,338,916.39|
|Lent to employee||20,152.00|
|Deposit|100,699.54|100,699.54|
|Other trades|1,184,157.00|1,857,049.35|
|Total|255,229,685.18|572,316,817.28|

(4) Top 5 other receivable entities at the end of the period
In RMB
|||||||
|-|-|-|-|-|-|
||||||Bad debt provision|
|||||Percentage in the||
|Entity|By account|Closing balance|Age||balance at the end of|
|||||aggregate||
||||||the period|
|Shenzhen Fangda||||||
|Property||||||
||Trades|133,179,160.80|Less than 1 year|52.18%||
|Development Co.,||||||
|Ltd.||||||
|Shenzhen Fangda||||||
|Jianke Group Co.,|Trades|82,615,134.19|Less than 1 year|32.37%||
|Ltd.||||||
|HK Junjia|Trades|83,183.13|Less than 1 year|0.03%||
|HK Junjia|Trades|3,230.36|1-2 years|||
|HK Junjia|Trades|6,529.28|2-3 years|||

China Fangda Group Co., Ltd. 2014 Annual Report
||||||
|-|-|-|-|-|
|HK Junjia|Trades|30,380,251.73|Over 3 years|11.90%|
|Shenyang Fangda|||||
|Semi-conductor|Trades|6,906,771.58|Over 3 years|2.71%|
|Lighting Co., Ltd.|||||
|Shenzhen Woke|||||
|Semi-conductor|Trades|630,000.00|Less than 1 year|0.25%|
|Lighting Co., Ltd.|||||
|Shenzhen Woke|||||
|Semi-conductor|Trades|2,342.08|2-3 years||
|Lighting Co., Ltd.|||||
|Shenzhen Woke|||||
|Semi-conductor|Trades|106,411.33|Over 3 years|0.04%|
|Lighting Co., Ltd.|||||
|Total|--|253,913,014.48|--|99.48%|

3. Long-term share equity investment
In RMB
||||||||
|-|-|-|-|-|-|-|
||Closing balance|||Ending balance|||
|Items|Remaining book|Impairment||Remaining book|Impairment||
||||Book value|||Book value|
||value|provision||value|provision||
|Investment insubsidiaries|||||||
||1,166,555,998.58|46,930,100.00|1,119,625,898.58|749,452,105.58|39,718,360.00|709,733,745.58|
|Investment inaffiliates|||||||
||11,048,660.43||11,048,660.43|9,994,565.55||9,994,565.55|
|Total|1,177,604,659.01|46,930,100.00|1,130,674,559.01|759,446,671.13|39,718,360.00|719,728,311.13|

 (1) Investment in subsidiaries
In RMB
||||||||
|-|-|-|-|-|-|-|
|||||||Impairment|
||||||Provision made in|provision balance|
|Invested entity|Ending balance|Increase|Decrease|Closing balance|||
||||||this period|at the end of the|
|||||||period|
|Fangda Jianke|305,000,000.00|186,950,000.00||491,950,000.00|||
|Fangda|||||||
||19,800,000.00|||19,800,000.00||19,800,000.00|
|Aluminium|||||||
|Fangda Yide|19,907,760.00||19,907,760.00||||
|HK Junjia|10,600.00|||10,600.00||10,600.00|

China Fangda Group Co., Ltd. 2014 Annual Report
||||||||
|-|-|-|-|-|-|-|
|Fangda Automatic|170,385,071.73|||170,385,071.73|||
|Fangda New|||||||
||74,496,600.00|||74,496,600.00|||
|Material|||||||
|Shenyang Fangda|108,852,073.85|||108,852,073.85|27,119,500.00|27,119,500.00|
|Kexunda|1,000,000.00|||1,000,000.00|||
|Fangda Property|50,000,000.00|150,000,000.00||200,000,000.00|||
|Shihui|||||||
|International||61,653.00||61,653.00|||
|Holding Co., Ltd.|||||||
|Fangda New|||||||
|||100,000,000.00||100,000,000.00|||
|Energy|||||||
|Total|749,452,105.58|437,011,653.00|19,907,760.00|1,166,555,998.58|27,119,500.00|46,930,100.00|

 (2) Investment in affiliate
Invested entity Opening amount Increase Decrease Closing amount Affiliate:
Shenzhen Ganshang
Joint Investment Co., 9,994,565.55 1,054,094.88 11,048,660.43 Ltd.
(3) Others
4. Operational revenue and costs
In RMB
||||||
|-|-|-|-|-|
||Amount occurred in the current period||Occurred in previous period||
|Items|||||
||Income|Cost|Income|Cost|
|Other business|29,609,371.13|5,669,281.13|45,659,921.07|10,980,932.52|
|Total|29,609,371.13|5,669,281.13|45,659,921.07|10,980,932.52|

 5. Investment income
In RMB
||||
|-|-|-|
|Items|Amount occurred in the current period|Occurred in previous period|
|Gains from long-term equity investment|||
||28,639,627.17||
|measured by costs|||
|Gains from long-term equity investment|||
||1,054,094.88|-5,434.45|
|measured by equity|||
|Other investment gains|111,670.20||

China Fangda Group Co., Ltd. 2014 Annual Report
||||
|-|-|-|
|Total|29,805,392.25|-5,434.45|

6. Others
XVII. Supplementary Materials
1. Detailed accidental gain/loss
In RMB
||||
|-|-|-|
|Items|Amount|Notes|
|Gain/loss of non-current assets|-24,398.43||
|Subsidies accounted into the current income|||
|account (except the government subsidy|||
|closely related to the enterprise’s business|2,340,175.75||
|and based on unified national standard|||
|quota)|||
|Capital using expense charged to|||
|non-financial enterprises and accounted into|3,649,313.12||
|the current income account|||
|Gain from entrusted investment or assets|||
||2,144,844.80||
|management|||
|Gain/loss from change of fair value of|||
|transactional financial asset and liabilities,|||
|and investment gains from disposal of|||
|transactional financial assets and liabilities|-2,852,885.00||
|and sellable financial assets, other than valid|||
|period value instruments related to the|||
|Company’s common businesses|||
|Gain/loss from change of fair value of|||
|investment property measured at fair value|34,897,632.10||
|in follow-up measurement|||
|Other non-business income and expenditures|||
||-3,671,724.03||
|other than the above|||
|Less: Influenced amount of income tax|9,526,862.57||
|Influenced amount of minority shareholders’|||
||-973,756.92||
|equity|||
|Total|27,929,852.66|--|

Explanation statement should be made for accidental gain/loss items defined and accidental
gain/loss items defined as regular gain/loss items according to the Explanation Announcement of
Information Disclosure No. 1 - Non-recurring gain/loss mentioned.
□ Applicable√ Inapplicable
China Fangda Group Co., Ltd. 2014 Annual Report 2. Net income on asset ratio and earning per share
|||||
|-|-|-|-|
|||Earning per share||
|Profit of the report period|Weighted average net income/asset ratio|Basic earnings per share|Diluted Earnings per|
|||(yuan/share)|share (yuan/share)|
|Net profit attributable to common||0.13|0.13|
||8.14%|||
|shareholders of the Company||||
|Net profit attributable to the||||
|common owners of the PLC after||||
||5.79%|0.09|0.09|
|deducting of non-recurring||||
|gains/losses||||

3. Differences in accounting data under domestic and foreign accounting standards
(1) Differences in net profits and assets in financial statements disclosed according to the international and Chinese account standards
In RMB
||||||
|-|-|-|-|-|
||Net profit||Net assets||
||Amount occurred in the|Occurred in previous|||
||||Closing balance|Ending balance|
||current period|period|||
|On Chinese accounting|96,998,429.76|85,676,863.78|1,234,930,863.46|1,160,639,730.85|
|standards|||||
|Items and amounts adjusted according International Accounting Standards|||||
|On international|||||
||96,998,429.76|85,676,863.78|1,239,694,261.70|1,165,403,129.09|
|accounting standards|||||

(2) Differences in net profits and assets in financial statements disclosed according to the international and Chinese account standards
□ Applicable√ Inapplicable
(3) Where the data audited by overseas auditor has been adjusted, the name of the overseas auditor should be specified.
Net assets attributable to the listedcompany’s shareholders calculated according to the IAS is RMB4,763,398.24 higher than that calculated according to the domestic accounting standards, mainly attributable to the
capitalization of borrow expenses before the domestic Enterprise Accounting Standard was implemented on January 1, 2007.
China Fangda Group Co., Ltd. 2014 Annual Report 4. Supplementary material related to changes to accounting policies
√ Applicable□ Inapplicable
According to the eight modified accounting standards including Enterprise Accounting Standard No.2–
Long-term Equity Investment, balance sheet from January 1, 2013 to December 31, 2013 is restated as follows: In RMB
|||||
|-|-|-|-|
|Items|January 1, 2013|December 31, 2013|December 31, 2014|
|Current asset:||||
|Monetary capital|278,283,968.61|333,876,921.97|212,430,798.87|
|Financial assets measured at|||13,410,790.00|
|fair value with variations||||
|accounted into current||||
|income account||||
|Notes receivable|7,638,780.88|21,898,770.43|83,325,725.70|
|Account receivable|774,890,805.30|898,780,981.93|1,105,242,251.46|
|Prepayment|22,006,159.22|28,364,016.21|29,234,231.49|
|Interest receivable|72,833.33|36,387.50||
|Other receivables at the end|||48,950,647.67|
||57,339,556.28|66,298,730.17||
|of the period||||
|Inventory|269,120,191.36|428,537,851.82|982,441,187.05|
|Other current assets|||234,986,107.72|
|Total current assets|1,409,352,294.98|1,777,793,660.03|2,710,021,739.96|
|Non-current assets:||||
|Long-term share equity|||11,048,660.43|
|||9,994,565.55||
|investment||||
|Investment real estate|258,405,762.09|195,249,069.13|226,279,523.39|
|Fixed assets|341,555,810.21|462,930,269.98|489,714,684.63|
|Construction in process|175,138,694.28|940,841.00|341,749.17|
|Disposal of fixed assets||177,298.11|26,918.21|
|Intangible assets|102,380,382.21|91,527,650.52|98,947,331.09|
|R&D expense|67,700.00|||
|Goodwill|||26,279,395.89|
|Long-term amortizable|||4,119,362.63|
||4,710,860.65|3,799,354.79||
|expenses||||
|Deferred income tax assets|36,191,385.09|41,166,043.56|52,616,656.38|
|Other non-current assets||15,978,789.90|43,323,878.63|
|Total of non-current assets|918,450,594.53|821,763,882.54|952,698,160.45|

China Fangda Group Co., Ltd. 2014 Annual Report
|||||
|-|-|-|-|
|Total of assets|2,327,802,889.51|2,599,557,542.57|3,662,719,900.41|
|Current liabilities||||
|Short-term loans|181,970,000.00|369,000,000.00|1,100,000,000.00|
|Notes payable|160,779,777.03|188,570,850.63|227,266,485.57|
|Account payable|411,846,031.72|489,216,140.32|685,108,346.73|
|Prepayment received|77,741,903.02|168,386,251.94|122,285,231.14|
|Employees’ wage payable|23,945,272.55|30,182,851.80|41,703,314.26|
|Taxes payable|33,686,577.98|44,839,947.77|58,696,926.25|
|Interest payable|1,954,557.27|689,153.75|2,055,911.11|
|Other payables|41,340,056.86|41,687,580.72|47,425,682.44|
|Non-current liabilities due in|||6,000,000.00|
|1 year||||
|Other current liabilities|200,000,000.00|||
|Total current liabilities|1,133,264,176.43|1,332,572,776.93|2,290,541,897.50|
|Non-current liabilities:||||
|Long-term payable|7,700.00||6,000,000.00|
|Anticipated liabilities|||5,859,045.98|
|Deferred earning||10,255,823.93|10,049,892.04|
|Deferred income tax|||49,734,436.90|
||36,210,286.40|40,656,763.97||
|liabilities||||
|Total of non-current|||71,643,374.92|
||36,217,986.40|50,912,587.90||
|liabilities||||
|Total liabilities|1,169,482,162.83|1,383,485,364.83|2,362,185,272.42|
|Owner’s equity:||||
|Share capital|756,909,905.00|756,909,905.00|756,909,905.00|
|Capital reserves|79,099,220.38|79,099,220.38|79,099,220.38|
|Other miscellaneous income|1,200,647.26|91,831.63|91,831.63|
|Surplus reserves|30,494,542.94|46,389,142.21|48,842,080.76|
|Retained profit|230,907,879.99|278,149,631.63|349,987,825.69|
|Total of owner’s equity|||1,234,930,863.46|
||1,098,612,195.57|1,160,639,730.85||
|belong to the parent company||||
|Minor shareholders’ equity|59,708,531.11|55,432,446.89|65,603,764.53|
|Total of owners’ equity|1,158,320,726.68|1,216,072,177.74|1,300,534,627.99|
|Total liabilities and|||3,662,719,900.41|
||2,327,802,889.51|2,599,557,542.57||
|shareholders’ equity||||

China Fangda Group Co., Ltd. 2014 Annual Report 5. Others
None
China Fangda Group Co., Ltd. 2014 Annual Report XI Documents for Reference
1. The Annual Report 2014 and the Summary with signature of the legal representative (Chinese and English); 2. Accounting Statements with signatures and seals of the legal representative and financial principal and chief of accounting department;
3. Original copy of theAuditors’ Report under the seal of the CPA and signed by and under the seal of certified accountants.
4. Originals of all documents and manuscripts of Public Notices of the Company disclosed in public in the newspapers as designated by China Securities Regulatory Commission.