ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 SHENZHEN PROPERTIES& RESOURCES DEVELOPMENT (GROUP) LTD.
ANNUAL REPORT 2018
（Announcement No.2019-12）
March 2019
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Table of Contents
Part I Important Notes, Table of Contents and Definitions ........................................................... 3 Part II Corporate Information and Key Financial Information ................................................... 5 Part III Business Summary ............................................................................................................. 10 Part IV Operating Performance Discussion and Analysis ........................................................... 16 Part V Significant Events ................................................................................................................ 38 Part VI Share Changes and Shareholder Information ................................................................. 49 Part VII Preferred Shares ............................................................................................................... 59 Part VIII Directors, Supervisors, Senior Management and Staff................................................ 60 Part IX Corporate Governance ...................................................................................................... 70 Part X Corporate Bonds .................................................................................................................. 77 Part XI Financial Statements .......................................................................................................... 78 Part XII Documents Available for Reference .............................................................................. 226
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Part I Important Notes, Table of Contents and Definitions The Board of Directors (or the “Board”), the Supervisory Committee as well as the directors, supervisors and senior management of ShenZhen Properties& Resources Development (Group) Ltd. (hereinafter referred to as the “Company”) hereby guarantee the factuality, accuracy and completeness of the contents of this Report and its summary, and shall be jointly and severally liable for any misrepresentations, misleading statements or material omissions therein.
Liu Shengxiang, theCompany’s legal representative, Cai Lili, theCompany’s head of financial affairs, and Liu Qiang, head of theCompany’s financial department (equivalent to financial manager) hereby guarantee that the Financial Statements carried in this Report are factual, accurate and complete.
All theCompany’s directors have attended the Board meeting for the review of this Report and its summary.
The Company is subject to the Guideline No. 3 of the Shenzhen Stock Exchange on Information Disclosure byIndustry—for Listed Companies Engaging in Real Estate, for which it is required to include in this Report the changes in thecountry’s real estate policy and the related financial policy, as well as the supply and demand changes in the real estate sector.
The Board has approved a final dividend plan as follows: based on the 595,979,092 shares, a cash dividend of RMB3.00 (tax inclusive) per 10 shares is to be distributed to the shareholders, with no bonus issue from either profit or capital reserves.
This Report and its summary have been prepared in both Chinese and English. Should there be any discrepancies or misunderstandings between the two versions, the Chinese versions shall prevail.
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Definitions
|||
|-|-|
|Term|Definition|
||ShenZhen Properties & Resources Development (Group) Ltd. and its|
|The ―Company‖, the ―Group‖, ―SZPRD‖ or ―we‖||
||consolidated subsidiaries, except where the context otherwise requires|
|SIHC|Shenzhen Investment Holdings Co., Ltd.|
|SCIHC|Shenzhen Construction Investment Holdings Corporation|
|SIM|Shenzhen Investment Management Co., Ltd.|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Part II Corporate Information and Key Financial Information I Corporate Information
|||||
|-|-|-|-|
|Stock name|PRD, PRD-B|Stock code|000011, 200011|
|Changed stock name (if any)|N/A|||
|Stock exchange for stock||||
||Shenzhen Stock Exchange|||
|listing||||
|Company name in Chinese|深圳市物业发展(集团)股份有限公司|||
|Abbr.|深物业集团|||
|Company name in English (if||||
||ShenZhen Properties & Resources Development (Group) Ltd.|||
|any)||||
|Abbr. (if any)|SZPRD|||
|Legal representative|Liu Shengxiang|||
||39/F and 42/F, International Trade Center, Renmin South Road, Shenzhen, Guangdong Province,|||
|Registered address||||
||P.R.China|||
|Zip code|518014|||
||39/F and 42/F, International Trade Center, Renmin South Road, Shenzhen, Guangdong Province,|||
|Office address||||
||P.R.China|||
|Zip code|518014|||
|Company website|www.szwuye.com.cn|||
|Email address|000011touzizhe@szwuye.com.cn|||

II Contact Information
||||
|-|-|-|
||Board Secretary|Securities Representative|
|||Qian Zhong and Ding Minghua|
|Name|Fan Weiping||
||42/F, International Trade Center, Renmin|42/F, International Trade Center, Renmin|
|Address|South Road, Shenzhen, Guangdong|South Road, Shenzhen, Guangdong|
||Province, P.R.China|Province, P.R.China|
|Tel.|0755-82211020|0755-82211020|
|Fax|0755-82210610 82212043|0755-82210610 82212043|
|Email address|000011touzizhe@szwuye.com.cn|000011touzizhe@szwuye.com.cn|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 III Media for Information Disclosure and Place where this Report Is Lodged
|||
|-|-|
|Newspapers designated by the Company for|For A-stock investors: Securities Times|
|information disclosure|For B-stock investors: Ta Kung Pao (HK)|
|Website designated by CSRC for publication of this||
||www.cninfo.com.cn|
|Report||
||Board Office, 42/F, International Trade Center, Renmin South Road,|
|Place where this Report is lodged||
||Shenzhen, Guangdong Province, P.R.China|

IV Change to Company Registered Information
|||
|-|-|
|Unified social credit code|No change|
|Change to principal activity of the||
||No change|
|Company since going public (if any)||
||On 29 September 2004, the State-Owned Assets Supervision and Administration|
||Commission of Shenzhen Municipality (―SASAC Shenzhen‖) decided to incorporate|
||Shenzhen Investment Holdings Co., Ltd. (―SIHC‖) to include Shenzhen Investment|
||Management Co., Ltd. (―SIM‖, the former controlling shareholder of the Company)|
||and Shenzhen Construction Investment Holdings Corporation (―SCIHC‖). SCIHC and|
|Every change of controlling shareholder|SIM hold 323,796,324 and 56,582,573 shares respectively in the Company,|
|since incorporation (if any)|representing a combined stake of 63.82%.|
||On 19 October 2018, the Company was notified by its actual controlling shareholder|
||SIHC that it had received the Confirmation of Securities Transfer Registration from|
||China Securities Depository and Clearing Co., Ltd. (Shenzhen branch), marking the|
||completion of the equity transfer to SIHC. As such, SIHC has become the controlling|
||shareholder of the Company.|

V Other Information
The independent audit firm hired by the Company:
|||
|-|-|
|Name|Ruihua Certified Public Accountants LLP|
||9-10/F, Taiping Finance Tower, 6001 Yitian Road, Futian District, Shenzhen City, Guangdong|
|Office address||
||Province, China|
|Accountants writing signatures|Cai Xiaodong and Wang Huansen|

The independent sponsor hired by the Company to exercise constant supervision over the Company in the Reporting Period:□ Applicable√ Not applicable
The independent financial advisor hired by the Company to exercise constant supervision over the Company in the Reporting Period:
□ Applicable√ Not applicable
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 VI Key Financial Information
Indicate by tick mark whether there is any retrospectively restated datum in the table below.
□ Yes√ No
||||||
|-|-|-|-|-|
||||2018-over-2017||
||2018|2017||2016|
||||change (%)||
|Operating revenue (RMB)|2,787,240,632.53|2,904,690,690.53|-4.04%|2,059,204,077.18|
|Net profit attributable to the listed|592,723,852.71|622,962,734.37|||
||||-4.85%|354,857,241.74|
|company‘s shareholders (RMB)|||||
|Net profit attributable to the listed|||||
|company‘s shareholders before|591,362,024.37|559,625,850.90|5.67%|357,519,344.14|
|exceptional items (RMB)|||||
|Net cash generated from/used in|1,123,594,927.59|-346,269,760.94|||
||||424.49%|2,252,041,183.42|
|operating activities (RMB)|||||
|Basic earnings per share|0.9945|1.0453|||
||||-4.86%|0.5954|
|(RMB/share)|||||
|Diluted earnings per share|0.9945|1.0453|||
||||-4.86%|0.5954|
|(RMB/share)|||||
|Weighted average return on equity|||||
||18.94%|26.64%|-7.70%|15.79%|
|(%)|||||
||||Change of 31||
||||December 2018 over||
||31 December 2018|31 December 2017||31 December 2016|
||||31 December 2017||
||||(%)||
|Total assets (RMB)|5,820,202,137.54|5,393,331,548.87|7.91%|6,654,356,144.10|
|Equity attributable to the listed|3,337,949,324.64|2,921,693,794.08|||
||||14.25%|2,410,434,735.75|
|company‘s shareholders (RMB)|||||

VII Accounting Data Differences underChina’s Accounting Standards for Business Enterprises (CAS) and International Financial Reporting Standards (IFRS) and Foreign Accounting Standards
1. Net Profit and Equity under CAS and IFRS
□ Applicable√ Not applicable
No difference for the Reporting Period.
2. Net Profit and Equity under CAS and Foreign Accounting Standards
□ Applicable√ Not applicable
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 No difference for the Reporting Period.
VIII Key Financial Information by Quarter
Unit: RMB
||||||
|-|-|-|-|-|
||Q1|Q2|Q3|Q4|
|Operating revenue|544,366,414.09|280,647,570.88|373,989,694.46|1,588,236,953.10|
|Net profit attributable to the listed|||||
||53,456,824.88|29,515,702.71|61,216,163.81|448,535,161.31|
|company‘s shareholders|||||
|Net profit attributable to the listed|||||
|company‘s shareholders before|53,039,124.57|28,924,009.75|61,962,097.63|447,436,792.42|
|exceptional items|||||
|Net cash generated from/used in|||||
||-96,704,935.74|-128,887,050.07|275,573,016.00|1,073,613,897.40|
|operating activities|||||

Indicate by tick mark whether any of the quarterly financial data in the table above or their summations differs materially from what have been disclosed in theCompany‘s quarterly or interim reports.
□ Yes√ No
IX Exceptional Gains and Losses
√ Applicable□ Not applicable
Unit: RMB
||||||
|-|-|-|-|-|
|Item|2018|2017|2016|Note|
|Gain or loss on disposal of non-current|-79,489.58|||Disposal ofmiscellaneous assets|
|assets (inclusive of impairment allowance||104,883,756.37|-182,886.11||
|write-offs)|||||
|Government subsidies charged to current|165,676.08|||The subsidy forkeeping stable jobs|
|profit or loss (exclusive of government|||||
|subsidies given in the Company‘s ordinary|||||
|course of business at fixed quotas or|||||
|amounts as per the government‘s uniform|||||
|standards)|||||
|Gain or loss on contingencies that do not|||||
|arise in the Company‘s ordinary course of||-5,491,792.67|-4,366,315.82||
|business|||||
|Non-operating income and expense other|1,724,017.41|||Penalty and liquidateddamages income|
|||-466,062.66|1,010,733.64||
|than the above|||||
|Less: Income tax effects|448,375.57|35,589,017.57|-876,365.89||
|Total|1,361,828.34|63,336,883.47|-2,662,102.40|--|

Explanation of why the Company reclassifies as recurrent an exceptional gain/loss item defined or listed in the Explanatory
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Announcement No. 1 on Information Disclosure for Companies Offering Their Securities to thePublic—Exceptional Gain/Loss Items:
□ Applicable√ Not applicable
No such cases for the Reporting Period.
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Part III Business Summary
I Principal Activity of the Company in the Reporting Period
Is the Company subject to any industry-specific disclosure requirements?
Yes, because the Company engages in real estate.
(I) Core Business Overview
Shenzhen Property Group was established in November 1982 that the predecessor was Luohu Engineering Construction Headquarters and renamed to Shenzhen Municipal Property Development Corporation in August 1985. The Company was determined as the second batch of pilot units for joint-stock reform of state-owned enterprises in 1988. Approved by the municipal government, the Company renamed to Shenzhen Properties& Resources Development (Group) Ltd. (SZPRD) in April 1990. The stock of the group company (Shenzhen PropertyA+B; securities code 000011/200011) was officially listed in Shenzhen Stock Exchange in March 1992. The Company is headquartered in International Trade Centre Building, Renmin South Road, Luohu District.
At its inception, the Company contracted and built Shenzhen International Trade Centre Building as Party A, and created the world-famous "Shenzhen Speed" that "one floor was completed in three days". International Trade Centre Building ranked the first place in several places in China: It was the first super-high-rise building in China, which has occupied the position of "the tallest building in the country" for ten years; It was the first building project involving bidding in China. It is the landmark building in Luohu and even Shenzhen, a resounding historical and cultural symbol in Shenzhen and the "cultural card in Shenzhen". It was selected into the first batch of 45 historical buildings in Shenzhen and became "The Reflection of the Shenzhen Speed and the Symbol of the Reform and Opening-up" with a reputation for the whole country and even the world. The enterprise spirit of "going ahead and reforming" of Shenzhen Property Group has also become the spiritual totem of the numerous entrepreneurs in Shenzhen. The three generations of leaders of the Party and the State are very concerned about the growth and development of the Company. On 22 June 1990, Comrade Jiang Zemin inspected the International Trade Centre Building and commemorated the inscription; On 20 January 1992, Comrade Deng Xiaoping overlooked Shenzhen in the revolving restaurant at the 53rd floor of the International Trade Centre Building, and delivered a 30-minute "South Inspection Speech"; On 13 November 1994, Comrade Hu Jintao personally inspected the Company and commemorated the inscription.
Since its establishment 37 years ago, the Company has developed into a large-scale comprehensive group company from a simple project company at that time, taking Luohu as its base area and radiating all over the country. The group has successively won a number of honors, such as the second place of "Top-100 Real Estate Enterprises with Comprehensive Benefits in China", the 23rd place of the first rating of "Top 100 Companies with Comprehensive Strength of Listed Companies in China", "Top-500 Real Estate Development Enterprises in China" for eight consecutive years (2011-2018), the 35th place of "National Property Service Industry in 2018", the fourth place of "Excellent property Management Enterprises in China's Industrial Park in 2017", etc.
The Company currently has 9 functioning secondary subsidiaries in total, including 4 property development subsidiaries (Shenzhen Huangcheng Real Estate Co., Ltd., Dongguan ITC Changsheng Real Estate Development Co., Ltd., SZPRD Xuzhou Dapeng Real Estate Development Co., Ltd. and SZPRD Yangzhou Real Estate Development Co., Ltd.), 1 property management subsidiary, 1 housing assets operation subsidiary, 2 joint ventures (SZPRD Jifa Warehouse Co., Ltd. and ShenzhenTian‘an International Building Property Management Co., Ltd., with the Company holding a50% stake in both), and 1 catering subsidiary.
1. Property Development
The property development business is principally operated by 4 subsidiaries. Those four subsidiaries are Shenzhen Huangcheng Real
Estate Co., Ltd., Dongguan ITC Changsheng Real Estate Development Co., Ltd., SZPRD Xuzhou Dapeng Real Estate Development
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Co., Ltd., and SZPRD Yangzhou Real Estate Development Co., Ltd. The following 6 property developments are currently ongoing: (1) SZPRD-GoldenCollar‘s Resort (Shenzhen): Located at the Huanggang Port, historical land, site area 12,600㎡, plot ratio 10.5, total floor area 130,000㎡ and sales have started in 2018.
(2) SZPRD-Qianhai Gangwan Garden (Shenzhen): Obtained in July 2011 in an asset swap promised in the share reform, site area 19,900㎡, plot ratio 3.2, total land price RMB270 million, open for sale in November 2015 and is currently selling the remaining houses.
(3) SZPRD-Songhu Langyuan (Dongguan): Won on 15 July 2010, site area 66,900㎡, plot ratio 2.2, total land price RMB214 million, open for sale at the end of July 2015 and is currently selling the remaining houses.
(4) SZPRD-Fuhui Huayuan (Shenzhen): Located in Fumin New Village, Futian District, historical land, site area 4,274㎡, total floor area 43,819㎡ and construction has officially begun on 29 December 2018.
(5) SZPRD-Hupan Yujing Phase I (Yangzhou): Won through bidding on 28 January 2011, site area 25,228㎡, and total floor area 50,948㎡. So far, residential units have been sold out and it is currently selling commercial and office space. SZPRD-Hupan Yujing Phase II (Yangzhou): Site area 41,331㎡, and total floor area 74,382㎡. Currently, it is selling the remaining residential units, as well as the commercial and office space.
(6) SZPRD-Banshan Yujing Phase I (Xuzhou): Won through bidding on 10 February 2010, site area 65,332㎡, and total floor area 101,605㎡. Currently, it is selling the remaining space. SZPRD-Banshan Yujing Phase II (Xuzhou): Site area 31,537㎡, and total floor area 34,956㎡. Construction has begun in late 2018.
2. Property Management
This business is principally run by Shenzhen International Trade Center Property Management Co., Ltd., which has four subsidiaries, namely, Shenzhen Huangcheng Property Management Co., Ltd., Shandong International Trade Center Property Management Co., Ltd., Chongqing International Trade Center Property Management Co., Ltd. and Yangzhou Jingyue Property Management Co., Ltd. Yangzhou Jingyue Property Management Co., Ltd. is a new joint venture incorporated in 2018, with the Company holding a51% interest. The establishment of this sub-subsidiary marked theCompany‘s official entrance to the area of cultural and tourism property management. International Trade Property Management Co., Ltd. has been developed into the domestic first-class industrial park brand property service provider. At present, the Company has 14 branches and three national-level qualified enterprises in the whole country, and employs more than 4,000 employees, including Hulun Buir, Manzhouli, Baoding in Southern Market, Shandong, Shanghai, Zhejiang and Jiangsu in East China Market, Shenzhen and Dongguan in South China Market, etc. The Company manages over 100 projects and covers an area of 16 million m2 (including the property park exceeding 5 million m2 (including trusteeship). The Company has provided service for the famous enterprise parks (Huawei, Alibaba, Jingdong, Hikvision) and a large batch of government property projects in Shandong and Chongqing with its excellent market competitiveness.
3. Property Rental
This was formerly run by the Leasing Center of the Group Headquarters, which has become SZPRD Housing Assets Operation and Management Co., Ltd. in 2018, running independently. The Company has now a total floor area of 81,610.23㎡ available for rental, with an occupancy rate of95%.
4. Catering Service
The catering business of the Company is operated by Shenzhen International Trade Catering Co., Ltd., with a total operating area of 1,892 square meters. Shenzhen International Trade Catering Co., Ltd. was established in 1986. The revolving restaurant under the operation of the Company has been listed as "The Highest-level Revolving Restaurant in China" by the State Council, and is also the only revolving restaurant in the country that runs Chinese food. Located on the 53rd floor of the International Trade Centre Building, the restaurant has received more than 600 Party and state leaders, domestic and foreign dignitaries, and cultural celebrities. The restaurant is also a scenic spot with unique historical significance in Shenzhen.
5. Warehousing Service
The warehousing service is mainly provided by SZPRD Jifa Warehouse Co., Ltd., a joint venture where the Company holds a50%
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 stake, with the total area of the warehouses reaching 35,000㎡.
(II) The Development Stage, Periodic Features and Status of TheCompany’s Industry Involved within the Reporting Period The development of the industry the Company is in is closely related to the development of the national economy and orientation of national policy with positive correlation with economic cycle fluctuations.
1. Real Estate
In March 2018, the government work report during the two sessions further emphasized the positioning of―Houses are for living in, not for speculatingon‖, and defined the localsubject‘s responsibilities so as to continue the differentiated regulation and control, establish a sound long-term mechanism, and promote the stable and healthy development of the real estate market. Under the guidance of this general idea, the market has begun to show favorable trend at a moderate growth speed.
In 2018, the sales area of commercial houses was 171.654 million square meters with a year-on-year increase of1.3%, but the growth rate dropped by 0.1 percentage point when compared to that from January to November and declined 6.4 percentage points when compared to that in last year. However, the sales volume of commercial houses achieved RMB 1,499.7 billion yuan with an increase of12.2% (increasing 0.1 percentage point when compared to that from January to November and dropping by 1.5 percentage points when compared to that in last year). At present, the current real estate inventory has been massively sold out to reach a record low value. At the end of 2018, the area of commercial houses for sale was 524.14 million square meters, decreasing 2.14 million square meters from that at the end of November, and decreasing 65.1 million square meters from that at the end of the previous year. The growth rate of land transfer revenue and the real estate investment maintained at a higher level, which can facilitate the transition from the strict policy to the tolerant policy. From January to December in 2018, the nationwide real estate development investment reached RMB 1202.64 billion yuan with a year-on-year increase of9.5%, and the growth rate declined 0.2 percentage point when compared to that from January to November while increasing 2.5 percentage points when compared to that during the same period last year. In 2018, the land acquisition area of real estate enterprises was 291.42 million square meters with a year-on-year increase of14.2%, but the growth rate declined 0.1 percentage point when compared to that from January to November while dropping 1.6 percentage points when compared to that during the same period last year. The land transaction price amounted to RMB 1610.2 billion yuan with a year-on-year increase of18.0%, but the growth rate declined 2.2 percentage points when compared to that from January to November while decreasing 31.4 percentage points when compared to that during the same period last year.
The financing situation in 2018 was not so good, and the increase in the availability of funds was mainly driven by the self-raised funds and the deposits for public recognition. In 2018, the real estate development enterprises received the available funds of RMB 1,659.6 billion yuan with a year-on-year increase of6.4%, but the growth rate dropped by 1.2 percentage points when compared to that from January to November while declining 1.8 percentage points when compared to that last year. However, the domestic loans were RMB 2,005 billion yuan, decreasing4.9%; the utilized foreign capital reached RMB 10.8 billion yuan, declining35.8%; the self-raised funds were RMB 558.31 billion yuan, increasing9.7%; the deposits and advances received were RMB 5541.8 billion yuan, increasing13.8%; the individual mortgage loans were RMB 2,370.6 billion yuan, declining0.8%.
During 2018 Central Economic Work Conference, 2019 monetary policies were worked out with the emphasis placed on―moderate monetary policies shall achieve a proper balance and maintain the rational and sufficientflexibility‖ rather than―neutral‖. From the perspective of monetary policies, the central bank has carried out multiple RRR cuts, and in terms of financial supervision, it has gradually shifted from―Deleveraging‖ to―Stabilizingleverages‖. On the whole, policies have become relatively loose. As the proverb goes that―the small river will spill when the big river is full ofwater‖, when the funds flowing into the real estate industry are expected to increase, the real estate financing environment is expected to improve.
From the perspective of real estate policies, the two meetings of Political Bureau of the Central Committee respectively held on October 31 and December 13, 2018 did not mentioned the real estate for two consecutive times since July 2015, but emphasized―stable employment, stable financing, stable foreign trade, stable foreign investment, stable investment, and stableexpectations‖. Similarly,―regulation andcontrol‖ was not mentioned during 2018 Central Economic Work Conference on the deployment of real estate policies in 2019, but emphasis was placed on―building a long-term mechanism for the healthy development of the real estate market; insisting on the positioning of‗Houses are for living in, not for speculatingon‘; implementing different policies in line with
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 the actual situation under classified guidance; strengthening main responsibilities of thecity‘s government; improving the housing market system and the housing guaranteesystem‖, which indicates that the current real estate market price drop is consistent with the forecast made by the central government, and the real estate policy has changed from―regulated‖ to―moderate‖. Looking forward to 2019,―stabilized housingprice‖ is the main keynote.
2. Property Management Industry
Up to now, the property management industry successively experienced the initial development period, the period of standardization and the new diversified development period. As the industry continues to develop, various government departments are paying more and more attention to the property management, and relevant laws and regulations have also been published in succession with the policy content evolving from normative content to supportive and encouraging content.
In the future, various companies providing property services will accelerate their transformation and upgrading, and gradually transform from traditional providers of property services to integrated providers of modern services. Through outsourcing traditional property services to more specialized companies, refined and specialized division of labor can thus be realized; by providing standardized―PersonalButler‖ services based on hi-tech means, theowners‘ needs for life services can be satisfied; in combination with fine-sorted, complete and professional outsourcing services, the quality of property services will be continuously improved to create much more value for the owners. With new ideas and thought, various property service companies will pay much more attention to theowners‘ diversified needs while improving their service efficiency and quality by means of high and new technologies including the AI technology, and continue to strengthen the reserve of talents in order to realize the property managementservice‘s standardization, the technological modernization, the business diversification, and the specialization of talents. The sales area of nationwide commercial houses and affordable houses is expected to exceed 4 billion square meters from 2018 to 2020 in line with the internal and external macroeconomic environment. Taking the property management area of 24.665 billion square meters in 2017 as the benchmark, the nationwide property management area will exceed 28.7 billion square meters in 2020; if calculated based on the average property management fees charging standards of Top 100 Property Management Companies,China‘s basic property management market size in the next five years will achieve RMB 1.5 trillion yuan.
In 2018, the property service industry became much more diversified and involved various fields including pension service, financing, leasing, education, tourism, new retail and agriculture etc., and some property management companies have even built their own brand. Based on the compound growth rate of11.3% of total retail sales of consumer goods from 2012 to 2017, the total retail sales of consumer goods in 2020 is estimated to reach RMB 62.56 trillion yuan. If the communitybusiness‘s proportion is40% and the community value-addedservice‘s market penetration rate is13.5%, it can be comprehensively predicted that thecommunity‘s value-added property service scale could reach RMB 3.38 trillion yuan. By means of the diversified community-level value-added service, various enterprises can enhance their own profitability, and stimulate the huge community terminal consumption resources, which is vital to better the capital market.
3. Industrial Position of the Company
(1) The Company has won such titles as Top 500 Real Estate Development Companies in China and Top 500 Companies in Guangdong for eight consecutive years, and obtained the honorary title of Top 100 Property Service Companies in China for three consecutive years.
(2) As theCompany‘s wholly-owned subsidiary, Shenzhen International Trade Center Property Management Co., Ltd. is the first property management company positioned to office buildings in China. Up to now, its service area has exceeded 13 million square meters, of which, the industrialpark‘s property service area has exceeded 2.7 million square meters. Shenzhen International Trade Center Property Management Co., Ltd. has also won various honorary titles including 2018 Annual Top 100 (ranking 35th), and 2018China‘s Outstanding Enterprises Specialized in the Property Management of Industrial Parks (ranking 4th) etc..
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 II Significant Changes in Major Assets
1. Significant Changes in Major Assets
|||
|-|-|
|Major assets|Main reason for significant changes|
||Up 3.28% from the beginning amount, primarily driven by gains on joint ventures|
|Equity assets||
||recognized at the equity method|
||Up 11.13% from the beginning amount, primarily driven by new purchases and the|
|Fixed assets||
||reclassification of certain investment property to fixed assets|
|Intangible assets|No such assets|
|Construction in progress|No such assets|
||Up 36.83% from the beginning amount, primarily driven by a larger inflow of sales|
|Monetary capital||
||revenue|
||Down 73.26% from the beginning amount, primarily driven by the receipt of the|
|Other receivables||
||payment for the sale of two taxi service subsidiaries|
||Down 36.14% from the beginning amount, primarily driven by the settlement on real|
|Inventory||
||estate projects in the Reporting Period|
||Up33.96% from the beginning amount, primarily driven by larger amounts of deductable|
|Deferred income tax assets||
||loss and land VAT provision|
||Up by RMB108.97 million from the beginning amount, primarily driven by prepayments|
|Other non-current assets||
||for investments|

2. Major Assets Overseas
□ Applicable√ Not applicable
III Core Competitiveness Analysis
Is the Company subject to any industry-specific disclosure requirements?
Yes, because the Company engages in real estate.
In the recent years, the Company has maintained a stable business model with real estate as the core, supplemented by other diverse operations. Its asset size, operating revenue and net profit have kept hitting new records, which is mainly attributed to theCompany‘s accurate market positioning and unique core competitiveness advantages:
The first is the enterprise spirit of "going ahead and reforming". The Company is headquartered in Shenzhen. The "Shenzhen Speed" that "one floor was completed in three days" reflected the good style of work of Shenzhen Property personnel, such as taking courage to explore, attacking and overcoming difficulties, advancing despite the difficulties, and being pragmatic and efficient, etc. The enterprise spirit of "going ahead and reforming" has encouraged a generation of Shenzhen property people to seek for a higher and
stronger goal, and the continuous and healthy development of the Company.
Second, the Company has a stable operation team, which persists in the corporate development strategy, continuously making the 12th
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Five-Year Strategic Plan and the 13th Five-Year Strategic Plan and pioneering with the strategic plans as the guideline and road map, thus ensuring the continuity of theCompany‘s principal policy.
Third, the Company is currently adopting a mode of two levels, Group Headquarters - City Companies for controlling its property development projects. At the headquarters level, the group mainly manages issues such as land investment, planned operation, key marketing nodes, above-norm plan and design and cost control, while companies in the cities are engaged in project management, on-site marketing, under-norm on-site design and cost control. Thus, the project companies are given sufficient independence. The group focuses on systematic management, currently having established a standardized internal operation system such as Real Estate Handbook, etc. for the comprehensive management policy for real estate. TheCompany‘s property control mode is being improved and matured.
Fourth, theCompany‘s development areas are mainly in Shenzhen and its neighboring cities, thanks to the price advantage of land obtainment costs and the rapid development ofShenzhen‘s real estate market. TheCompany‘s regional projects in Shenzhen will bring itself with good economic profits.
Fifth, the Company has an advantage in brand and culture condensation. Over more than 30 years of development and accumulation, the Company is highly recognized in the market by virtue of its brand value of―Shenzhen Properties&Resources‖ that carries the spirit of international trade in the reform and opening up and comprehensive competence. The Company has won multiple honor titles such as―Best 500 of China Real EstateDevelopers‖ and―Guangdong Top 500Enterprises‖.
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Part IV Operating Performance Discussion and Analysis
I Overview
(I) Review of industry development during the reporting period
1. Macroeconomic environment
In 2018, China's economic growth rate was declining, and the growth rate of GDP in four quarters was6.8%,6.7%,6.5%, and6.4%, respectively. The growth rate in the third quarter has been lower than the operating ranged that has been kept for 12 quarters(6.7%～6.9%). The Value-added of Industrial Enterprises Above Designated Size was5.8% in September and reduced by0.3% than that in August. Since March 2016, it has fallen below6% for the first time; The growth rate was5.9% and5.4% respectively in October and November with a further decline.
More notably, the growth rate in consumer demand continued to decline. The year-on-year growth rate of Total Retail Sales of Consumer Goods was8.1% in October 2018, which was the lowest growth rate since June 2003; Affected by the continuous declination in the growth rate of resident income, rapid increase in resident sector leverage ratio, weakening wealth effect and other factors, the declining tendency of residents' consumption ability and willingness began to appear and the downward trend of consumption demand became obvious.
In terms of investment, the downward pressure of real estate investment was increasing, the confidence of real estate enterprises in the future market was insufficient, and the development and construction activities tended to shrink; Infrastructure investment growth has fallen. After the Meeting of the political Bureau of the Central Committee on July 31, 2018, the growth rate became stable at a low level after October with the steady growth of related measures. However, taking into account the lack of local government financing capacity and other issues, the ability to pick up became further weak. Private enterprises, small and medium-sized enterprises were faced with more difficulties, and lack of confidence, investment will and capacity in the future market. When the domestic demand growth capacity was insufficient, the export growth rate also began to decline.
The Central Economic Work Conference convened in December 2018 pointed out that: The development of our country is still and will be in the period of important strategic opportunity for a long time. We should be good at turning a crisis into an opportunity and safety, firmly adhere to the new connotation of important strategic opportunities, accelerate the optimization and upgrading of the economic structure, enhance the capacity for scientific and technological innovation, deepen the reform and opening up, speed up green development, and participate in the reform of the global economic governance system, change the pressure to the driving force to accelerate the high-quality development of the economy.
The meeting proposed that we should continue to adhere to the general tone of work of seeking progress stably, and that in view of the changes in the situation and tasks, a series of new strategies have been made clear in terms of "stability" and "progress". The meeting emphasized the need to innovate and improve macroeconomic regulation and control, ensure that the economy operates within a reasonable range, further improve and implement stable employment, stable finance, stable foreign trade, stable foreign investment, steady investment, and stable expectations, and propose three major policies in the macro economy, structure and society. At the same time, more efforts should be made to work hard in the "progress". We must adhere to taking the supply-side structural reform as the main line, take more measures of reform, make more use of market-oriented and legal means, and work hard in "consolidation, enhancement, promotion and unblocking".
In accordance with the overall deployment of progress in a stable manner, we should do well in seven aspects in 2019, namely promoting the high-quality development of manufacturing industry, promoting the formation of a strong domestic market, firmly promoting the strategy of rural revitalization, promoting coordinated regional development, accelerating the reform of economic system, promoting all-round opening-up, and strengthening the protection and improvement of people's livelihood. In view that the
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 economic fundamentals in China turn better and based on the overall arrangement of the central economic conference, it can be predicted that in 2019, China's economy will show a tendency of "low base, steady progress, gradual rise". The annual growth of the economy will be slightly higher than the previous year. The good situation of "seek progress while maintaining stability" in the economy will be displayed continuously.
2. Industry pattern and trend analysis
International economic situation: It generally presents the characteristics of "three increases", namely increasing controversy between multilateralism and unilateralism/conservatism in international trade; Increase in geopolitical conflict; Increase in the fight between China and the US in economy, science and technology, trade and geographical relationship. But on the whole, it's still in a situation of fighting and not breaking. The trade friction between China and the United States is likely to reach a more comprehensive agreement than expected. The U.S. economy remains strong but there are hidden downside worries, and the pace of interest rate increases in the dollar is expected to slow down. The world economy has struggled to recover and rebound in the midst of a difficult dispute. Overall, the international economy in 2019 will not be worse than 2018.
Domestic economic situation: With the temporary truce of Sino-US trade friction, the national positive support and comprehensive encouragement to the private enterprises and private economy, the policies of "deepening reform and expanding high-level opening-up, as well as large-scale tax cuts and improvement of the business environment", the positive factors will appear in the "stable and changing economy", the expectations of economic downturn stabilization will be strengthened, and the confidence will be recovered and repaired to a certain degree. The bottom of politics and policy has appeared, but there are still a lot of uncertain factors. Overall, the downward pressure on the domestic economy in 2019 is greater than that in 2018.
The pace and intensity of the battle to prevent and control financial risks and eliminate pollution will be significantly adjusted, and the liquidity of social funds will be further abundant. Domestic real estate is still in a "stable with a slight decline" state and the price continues to drop obviously. The transaction of new houses and second-hand houses is solidified and difficult to keep active. It is expected that administrative regulation will not be increased throughout the year, and that market-oriented regulation will be valued and returned to a certain extent. There will be a moderate increase in Inelastic Demand before and after the mid-year in the first-line market. The inter-regional regulation and supervision policy is more obviously divided, and it is inevitable that there will be the possibility of implementing local improvement measures and strengthening the market regulation. But regulation of the overall situation will not be reversed. It is impossible to take a sharp rebound in housing prices within the year.
Economic situation in Shenzhen: On the whole, Shenzhen economy will remain the high-speed development trend because Sino-US trade frictions have limited impact. Real estate will continue to maintain the strength and scope of the "7.31" new policy. However, with the strong rise in Inelastic Demand and the recovery of confidence in economic development, Shenzhen will have a high probability that price stability will increase from the second quarter, and real estate transactions in the second half of the year will obviously recover. But it is unlikely that there will be a sharp rebound in prices. The good policies that benefit the real estate transactions cannot be ruled out, such as relaxing the household policy, reducing the interest rate of the first loan, improving the restrictions of lubrication trading and substantially increasing the liquidity
(II) Overview of TheCompany’s Business Operation in 2018
In 2018, theCompany‘s economic operation made certain progress steadily, the quality was also improved, and major business segments accordingly achieved major breakthroughs in stability.
Firstly, the operating performance maintained its high level and the Company over-fulfilled the budget targets. In 2018, the Company achieved operating revenue of about RMB 2.79 billion yuan with a profit before tax of about RMB 780 million yuan, and a net profit of RMB 593 million yuan. By the end of the year, theCompany‘s assets were about RMB 5.82 billion yuan, the net assets RMB 3.34 billion yuan. As its asset-liability ratio was only42.6%, the financial status was proved stable and high-quality, and strong in fending off risks. The return on net assets was about18%, which was higher than the industry average.
Secondly, the land reserve bottleneck has been initially relieved. Focusing on the annual challenge of―increasing the floor area of 500,000 square meters and the plot ratio-related construction are of 1 million squaremeters‖, the Company made great effort to promote the expansion. In this year, special effort was made to propel various city-industry integration projects in Longhua Guanlan,
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Zhaoqing, Yangzhou and Chongqing. Up to now, the urban renewal project in Guanlan Bangling, covering an area of about 68,000 square meters with the plot ratio-related construction area of about 380,000 square meters and the total construction area of over 500,000 square meters, has completed various acquisitions.
Thirdly, the property management business mergers and acquisitions and the market expansion were carried out at the same time to make great achievement. In 2018, the property management section newly expanded its area by more than 1.5 million square meters, and 8 industrial park projects including Alibaba Hangzhou Riverside Industrial Park were successfully undertaken. Meanwhile, the Company continuously expanded its industrial scale and completed the annual target of doubling the new area of property management. Besides, the Group Company has officially announced the acquisition of100% equity of TK Property. After the successful acquisition, the Company will realize its nationwide operation and management layout with Baoding (Shenzhen) Industrial Park in the north, Alibaba Hangzhou in the east, Shenzhen Bay Industrial Park in the south and JD in the west. By promoting work in all areas by drawing upon the experience gained on key points, exerting the powerful demonstration effect, and making progress in an all-round way, the overall strength of theCompany‘s industrial park operation and management sector will be further advanced, and is expected to rank among the top 3 in the national industry.
Fourthly, the housing asset management sector has taken firm steps. TheGroup‘s housing asset management Company operates independently and actively explores the development model of―long-term rental apartment+ commercialoffices‖, and strives to develop various key demonstrative long-term rental apartment projects including ONE39 Building, Longhua Fengherili Complex, Fumin New Village Complex and Xinhu Village. The Company will officially launch its―XiApartments‖ brand for trial operation at the end of the year.
(III) Features of Various Businesses Operated by the Company
1. The Real Estate Business Made Certain Progress Steadily
TheCompany‘s subsidiary has properly responded to the market changes, seized golden opportunities and made great achievement through timely adjusting the sales strategy according to specific policies and market conditions. Shenzhen Huangcheng Real Estate Co., Ltd. realized operating revenue of RMB 1.5 billion. In March 2018, Dongguan Songhu Langyuan Project was put on market before othercompetitors‘ projects. Throughout the year, about 18,190 m2 were sold. By optimizing negotiation strategies and seizing the opportunity, various shops with the difficulty in realization were all sold out. XuzhouCompany‘s operating revenue achieved RMB 120 million. Besides, a full success was achieved in the main contracting settlement in relation with Xuzhou Phase I Project. The commencement ceremony and subsequent construction of Xuzhou Phase II Project were also organized and held as scheduled; Yangzhou Company realized the operating revenue of about RMB 650 million, smoothly fulfilling the annual objective.
2. The Accelerated Development of Property Management Business
The Company has made unremitting effort to develop its property management business, achieved remarkable results in the business development, and continuously expanded its brand influence. Throughout the year, Shenzhen International Trade Center Property Management Co., Ltd. developed 28 new projects in various cities including Chongqing, Shandong, Hangzhou and Shanghai with the newly-added area of about 1.5 million square meters. Besides, it undertaken Aliyun Apsara Industrial Park, and integrated three core industrial parks of Alibaba into its service scope, becoming the largest framework supplier of Alibaba in the world for its integrated logistics support. Shenzhen International Trade Center Property Management Co., Ltd. realized the operating revenue of RMB 420 million yuan with a year-on-year increase of about RMB 60 million yuan, exceeding about110% of the annual budget. Meanwhile, its total profit achieved about RMB 27 million yuan with the year-on-year increase of about RMB 2.5 million yuan. Huangcheng Property Management Co., Ltd. realized the operating revenue of about RMB 65 million yuan, fulfilling about110% of the annual budget target.
3. Adjustment of House Rental Business
Relying on theheadquarters‘ leasing center, the Company has founded the housing assets operation Company in charge of readjusting the positioning of rental business and carrying out independent operation. The long-term rental apartment brand Xi Apartments is owned by the housing assets operation Company, and corresponding preparation work was completed at the end of December for its launching into the market. However, emphasis will be placed on launching three major long-term rental apartment
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 projects including ONE39 Building, Xinhu Village Apartment and Fengherili Complex.
(IV) Progress of Major Projects under Construction
1. SZPRD-GoldenCollar’s Resort Project (Shenzhen): As interior and exterior decoration works are basically completed, it is in the stage of preparing for various special acceptance inspections.
2. SZPRD-Qianhai Gangwan Project (Shenzhen): This project was successfully completed in December 2016.
3. SZPRD-Songhu Langyuan Project (Dongguan): This project was successfully completed in July 2017.
4. SZPRD-Fuhui Huayuan Project (Shenzhen): Theproject‘s planning permit and the foundation supporting construction permit were obtained in early December, and it was officially commenced on December 29.
5. SZPRD-Hupan Yujing Project Phase I (Yangzhou): This project was completed and owners moved in it in June 2014. 6. SZPRD-Hupan Yujing Project Phase II (Yangzhou): Thisproject‘s completion filing was completed in early November 2017, and owners moved in it at the beginning of 2018.
7. SZPRD-Banshan Yujing Project Phase I (Xuzhou): Owners successfully moved into the project in the first half of 2017, and houses are available for sale now.
8. SZPRD-Banshan Yujing Project Phase II (Xuzhou): Theproject‘s main contractor bidding was completed.
Details are described as follows:
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
||||||||Space|||||
|||||||Space sold||Space||||
||||||Opening||sold in||||The|
|||Site|Floor|Sellable||in Current||settled in||||
||||||sellable||Current||Status quo of|Time of|Company’s|
|Project|Location|area|area|space||Period（m2）||Current||||
||||||space||Period||project|completion|interest|
|||（m2）|（m2）|（m2）||(subscribed||Period||||
||||||（m2）||（m2）||||(%)|
|||||||for)||（m2）||||
||||||||(signed)|||||
|Qianhai|NanshanDistrict,Shenzhen|19,894|98,545|63,325|21,778|20,325|18,392|17,149|Completedandcommerciallyavailable|October2016|100|
|Gangwan||||||||||||
|Garden||||||||||||
|Yangzhou|WeiyangDistrict,Yangzhou|25,228|50,948|48,871|10,366|2,353|2,899|3,542|Completedandcommerciallyavailable|June 2015|100|
|Hupan||||||||||||
|Yujing||||||||||||
|Phase I||||||||||||
|Yangzhou|WeiyangDistrict,Yangzhou|41,331|74,382|73,122|25,652|9,130|9,703|54,343|Completedandcommerciallyavailable|November2017|100|
|Hupan||||||||||||
|Yujing||||||||||||
|Phase II||||||||||||
|Xuzhou|TongshanDistrict,Xuzhou|65,332|101605|85,653|17,163|11,297|10,972|79,785|Completedandcommerciallyavailable|November2016|100|
|Banshan||||||||||||
|Yujing||||||||||||
|Phase I||||||||||||
|Xuzhou|TongshanDistrict,Xuzhou|31,537|34,956|21,839|-------|-------|-------|-------|Newlycommencedand underconstruction|July 2020|100|
|Banshan||||||||||||
|Yujing||||||||||||
|Phase II||||||||||||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
|Songhu|DalangTown,Dongguan|66,882|207,459|140,911|20,718|18,373|18,190|15636|Completedandcommerciallyavailable|July 2017|100|
|Langyuan||||||||||||
|Golden|FutianDistrict,Shenzhen|12,598|183,323|119,198|38,885|3,306|89|-------|Underconstruction|March 2019|100|
|Collar’s||||||||||||
|Resort||||||||||||
|Apartment||||||||||||
|Fuhui|FutianDistrict,Shenzhen|4,274|43,819|30,150|-------|-------|-------|-------|Newlycommencedand underconstruction|December2021|100|
|Huayuan||||||||||||
|Huiyang|HuiyangDistrict,Huizhou|17,700|61,950|-------|-------|-------|-------|-------|In preparationforconstruction|PreliminaryPreparation|100|
|Danshui||||||||||||

Note: The space of the Yangzhou Hupan Yujing project includes the parking area.
(III) Properties for Rent
|||||
|-|-|-|-|
|||The Company’s interest||
|Type of property|Space available for rent (m2)||Annual revenue (RMB’0,000)|
|||(%)||
|Shops and offices|61,406.20|100%|5,634.31|
|Plants|6,818.95|100%|634.16|
|Residential units|3,501.83|100%|176.10|
|Hotels|8,383.25|100%|430.42|
|Complexes|1,500.00|100%|86.25|
|Total|81,610.23|100%|6,961.24 (tax inclusive)|

The Company is subject to the Guideline No. 3 of the Shenzhen Stock Exchange on Information Disclosure byIndustry—for Listed Companies Engaging in Real Estate.
See―Part IV Operating Performance Discussion andAnalysis‖,―IOverview‖ herein.
II Core Business Analysis
1. Overview
See―IOverview‖ above.
2. Revenue and Cost Analysis
(1) Breakdown of Operating Revenue
Unit: RMB
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||||
|-|-|-|-|-|-|
||2018||2017|||
|||As % of total||As % of total||
||||||Change (%)|
||Operating revenue|operating revenue|Operating revenue|operating revenue||
|||(%)||(%)||
|Total|2,787,240,632.53|100%|2,904,690,690.53|100%|-4.04%|
|By operating division||||||
|Property||||||
||2,209,992,090.75|79.29%|2,340,233,648.93|80.57%|-5.57%|
|development||||||
|Property rental|76,443,577.98|2.74%|79,236,389.91|2.73%|-3.52%|
|Property||||||
||401,218,038.76|14.40%|344,226,703.95|11.85%|16.56%|
|management||||||
|Transport service||0.00%|48,573,142.33|1.67%|-100.00%|
|Catering service|27,677,194.36|0.99%|30,898,120.01|1.06%|-10.42%|
|Other|71,909,730.68|2.58%|61,522,685.40|2.12%|16.88%|
|By product category||||||
|Property||||||
||2,209,992,090.75|79.29%|2,340,233,648.93|80.57%|-5.57%|
|development||||||
|Property rental|76,443,577.98|2.74%|79,236,389.91|2.73%|-3.52%|
|Property||||||
||401,218,038.76|14.40%|344,226,703.95|11.85%|16.56%|
|management||||||
|Transport service||0.00%|48,573,142.33|1.67%|-100.00%|
|Catering service|27,677,194.36|0.99%|30,898,120.01|1.06%|-10.42%|
|Other|71,909,730.68|2.58%|61,522,685.40|2.12%|16.88%|
|By operating segment||||||
|Shenzhen city|1,696,976,389.71|60.88%|1,227,064,851.69|42.24%|38.30%|
|Dongguan city|252,401,699.77|9.06%|1,036,257,611.02|35.68%|-75.64%|
|Other|837,862,543.05|30.06%|641,368,227.82|22.08%|30.64%|

 (2) Operating Division, Product Category or Operating Segment Contributing over10% of Operating Revenue or Operating Profit
√ Applicable□ Not applicable
Is the Company subject to any disclosure requirements for special industries?
Yes
Real Estate
Unit: RMB
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||||||
|-|-|-|-|-|-|-|
|||||YoY change in||YoY change in|
||Operating||Gross profit||YoY change in||
|||Cost of sales||operating revenue||gross profit|
||revenue||margin||cost of sales (%)||
|||||(%)||margin (%)|
|By operating division|||||||
|Real estate|||||||
||2,209,992,090.75|844,658,618.92|61.78%|-5.57%|-28.59%|12.33%|
|development|||||||
|Property|||||||
||401,218,038.76|390,234,660.55|2.74%|16.56%|16.29%|0.22%|
|management|||||||
|By product category|||||||
|Real estate|||||||
||2,209,992,090.75|844,658,618.92|61.78%|-5.57%|-28.59%|12.33%|
|development|||||||
|Property|||||||
||401,218,038.76|390,234,660.55|2.74%|16.56%|16.29%|0.22%|
|management|||||||
|By operating segment|||||||

Core business data of the prior year restated according to the changed statistical caliber for the Reporting Period:
□ Applicable√ Not applicable
(3) Whether Revenue from Physical Sales Is Higher than Service Revenue
√ Yes□ No
|||||||
|-|-|-|-|-|-|
|Operating division|Item|Unit|2018|2017|Change (%)|
||Unit sales|m2|60,245|73,537|-18.07%|
|Real estate||||||
||Output|m2|262,098|338,090|-22.47%|
|development||||||
||Inventory|m2|158,489|82,069|93.12%|

 Any over30% YoY movements in the data above and why:
√ Applicable□ Not applicable
Inventory increased due to the real estatesector‘s periodic changes and the progress ofproject‘s development and construction. (4) Execution Progress of Major Signed Sales Contracts in the Reporting Period
□ Applicable√ Not applicable
(5) Breakdown of Cost of Sales
By operating division
By operating division
Unit: RMB
||||||
|-|-|-|-|-|
|Operating|Item|2018|2017|Change (%)|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||||
|-|-|-|-|-|-|
|division||As % of total cost||As % of total cost||
||Cost of sales||Cost of sales|||
|||of sales (%)||of sales (%)||
|Real estate||||||
||844,658,618.92|64.22%|1,182,884,514.58|72.66%|-28.59%|
|development||||||
|Property rental|24,963,641.31|1.90%|22,951,930.77|1.41%|8.76%|
|Property||||||
||390,234,660.55|29.67%|335,567,577.69|20.61%|16.29%|
|management||||||
|Transport service||0.00%|29,669,816.38|1.82%|-100.00%|
|Catering service|24,630,697.78|1.87%|26,763,583.26|1.64%|-7.97%|
|Other|30,702,373.28|2.33%|30,030,482.96|1.84%|2.24%|

 Notes:
N/A.
(6) Changes in the Scope of Consolidated Financial Statements for the Reporting Period
√ Yes□ No
The Company increased 2 subsidiaries to the consolidated scope as compared with last year. For details, see VIII. Changes in Consolidated Scope in XI. Financial Statements of this Report.
(7) Major Changes to the Business Scope or Product or Service Range in the Reporting Period
□ Applicable√ Not applicable
(8) Major Customers and Suppliers
Major customers:
|||
|-|-|
|Total sales to top five customers (RMB)|235,744,668.00|
|Total sales to top five customers as % of total sales of the||
||10.56%|
|Reporting Period (%)||
|Total sales to related parties among top five customers||
||0.00%|
|as % of total sales of the Reporting Period (%)||

Information about top five customers:
|||||
|-|-|-|-|
|||Sales revenue contributed for||
|No.|Customer||As % of total sales revenue (%)|
|||the Reporting Period (RMB)||
||Property management center of Futitan|||
|1||75,826,580.00|3.95%|
||District Government, Shenzhen|||
|2|Alibaba (China) Co., Ltd.|74,090,411.00|3.32%|
|3|Dongguan Congze Trade Co., Ltd|62,554,040.00|2.80%|
|4|Natural person 1|11,667,429.00|0.52%|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||
|-|-|-|-|
|5|Natural person 2|11,606,208.00|0.52%|
|Total|--|235,744,668.00|10.56%|

 Other information about major customers:
□ Applicable√ Not applicable
Major suppliers:
|||
|-|-|
|Total purchases from top five suppliers (RMB)|76,383,439.00|
|Total purchases from top five suppliers as % of total||
||29.95%|
|purchases of the Reporting Period (%)||
|Total purchases from related parties among top five||
|suppliers as % of total purchases of the Reporting Period|0.00%|
|(%)||

Information about top five suppliers:
|||||
|-|-|-|-|
|||Purchase in the Reporting||
|No.|Supplier||As % of total purchases (%)|
|||Period (RMB)||
||The Second Construction Co., Ltd of|||
||The Second Construction Co., Ltd of|||
|1|China Construction Third Engineering|44,571,765.00|17.47%|
||Bureau|||
||Shanghai Reliance Environmental Service|||
|2||9,988,320.00|3.92%|
||Co., Ltd|||
||Zhejiang Ohant Comprehensive Service|||
|3||7,928,898.00|3.11%|
||Co., Ltd|||
||Shenzhen Design and Decoration|||
||Engineering Co., Ltd/ Shenzhen Pinguan|||
|4||7,686,667.00|3.01%|
||Construction Engineering Co., Ltd|||
||(Combo)|||
||Shenzhen Jianqiao Construction Group|||
|5||6,207,789.00|2.43%|
||Co., Ltd|||
|Total|--|76,383,439.00|29.95%|

 Other information about major suppliers:
□ Applicable√ Not applicable
3. Expense
Unit: RMB
||||||
|-|-|-|-|-|
||2018|2017|Change (%)|Reason for any significant change|
||46,501,225.18|31,179,193.33||Increases in commissions for sales|
|Selling expenses|||49.14%||
|||||agents and advertising expenditure|
|Administrative expenses|102,852,213.19|137,028,655.69|-24.94%|Equity transfer of two automobile|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||||
|-|-|-|-|-|
|||||subsidiaries in the same period of last|
|||||year, and the enterprises included into|
|||||consolidated financial statements in|
|||||this year decreased and the legal costs|
|||||decreased.|
||-57,579,532.57|-24,407,456.38||Increase in interest revenue of bank|
|Finance costs|||135.91%||
|||||deposits|
|Income tax expenses|184,813,373.69|203,784,886.40|-9.31%|Decrease in income|

4.R&D Expense
□ Applicable√ Not applicable
5. Cash Flows
Unit: RMB
|||||
|-|-|-|-|
|Item|2018|2017|Change (%)|
|Subtotal of cash generated from|2,746,158,558.76|1,337,537,854.19||
||||105.31%|
|operating activities||||
|Subtotal of cash used in|1,622,563,631.17|1,683,807,615.13||
||||-3.64%|
|operating activities||||
|Net cash generated from/used in|1,123,594,927.59|-346,269,760.94||
||||424.49%|
|operating activities||||
|Subtotal of cash generated from|80,016,759.11|68,062,071.40||
||||17.56%|
|investing activities||||
|Subtotal of cash used in|117,185,136.22|3,721,869.38||
||||3,048.56%|
|investing activities||||
|Net cash generated from/used in|-37,168,377.11|64,340,202.02||
||||-157.77%|
|investing activities||||
|Subtotal of cash generated from|3,450,000.00|||
|financing activities||||
|Subtotal of cash used in|178,793,727.60|107,246,594.16||
||||66.71%|
|financing activities||||
|Net cash generated from/used in|-175,343,727.60|-107,246,594.16||
||||63.50%|
|financing activities||||
|Net increase in cash and cash|911,088,034.88|-392,726,401.64||
||||-331.99%|
|equivalents||||

Explanation of why any of the data above varies significantly:
√ Applicable□ Not applicable
 Cash generated and net cash flows from operating activities increased from last year, primarily driven by the increase in house
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 payments received.
② Cash used and net cash flows from investing activities increased from last year, primarily driven by the increase of payments for investment in the Reporting Period.
③ Cash used and net cash flows from financing activities increased from last year, primarily driven by the increase of cash bonus.④ Net increase in cash and cash equivalents increased from last year, primarily driven by the increase in house payments received. Reason for any big difference between the net operating cash flow and the net profit for this Reporting Period
√ Applicable□ Not applicable
For the Reporting Period, the net cash flows from operating activities stood at RMB1,123,594,927.59, representing a big difference with the net income of RMB592,661,752.02, which was mainly because of the increased recoup funds of the projects of the Company and the time difference between related taxes provisions and actual payment.
III Analysis of Non-Core Businesses
√ Applicable□ Not applicable
Unit: RMB
||||||
|-|-|-|-|-|
||Amount|As % of total profit|Source/Reason|Exceptional or recurrent|
|||||Exceptional (excluding income|
||||Investment income of main||
|Investment income|1,889,021.11|0.24%||of joint ventures of|
||||joint ventures||
|||||RMB1268890.28)|
||||Reversal of some valuation||
||||allowances as a result of the||
||||rising prices of the||
|Asset impairments|-6,926,131.97|-0.89%||Exceptional|
||||Xuzhou-located Banshan||
||||Yujing in the Reporting||
||||Period||
|Non-operating|||Miscellaneous penalty||
||4,859,143.80|0.62%||Exceptional|
|income|||income||
||||Paying overdue fine and||
|Non-operating|||||
||3,040,842.92|0.39%|compensation for removing|Exceptional|
|expense|||||
||||tenants||
|Asset disposal|||Disposal income of||
||-8,096.97|0.00%||Exceptional|
|income|||Miscellaneous assets||

IV Analysis of Assets and Liabilities
1. Significant Changes in Asset Composition
Unit: RMB
|||||
|-|-|-|-|
|31 December 2018|31 December 2017|Change in|Reason for any significant change|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||||||
|-|-|-|-|-|-|-|
|||As % of total||As % of total|percentage (%)||
||Amount||Amount||||
|||assets||assets|||
||3,389,234,357.72||2,477,028,815.21|||The increased sales recoup funds of the|
|Monetary capital||58.23%||45.93%|12.30%||
|||||||projects|
||64,231,267.94||46,272,600.86|||Increase in property management|
|Accounts|||||||
|||1.10%||0.86%|0.24%|subsidiary‘s accounts receivable from|
|receivable|||||||
|||||||house owners|
||1,181,762,531.67||1,850,672,044.36|||Settlement of real estate project in|
|Inventories||20.30%||34.31%|-14.01%||
|||||||Reporting Period|
||400,550,689.90||426,849,558.05|||Change in percentage was driven by|
|Investment||||||increased total assets, and decrease in|
|||6.88%||7.91%|-1.03%||
|property||||||value was because of depreciation|
|||||||withdrawal|
|Long-term equity|39,999,283.24||38,730,392.96|||Increase of total assets at the|
|||0.69%||0.72%|-0.03%||
|investments||||||period-end|
||32,612,592.40||29,346,901.33|||Newly increased fixed assets in the|
|Fixed assets||0.56%||0.54%|0.02%||
|||||||Reporting Period|
|Long-term|1,000,000.00|||||Newly increased borrowings in the|
|||0.02%|||0.02%||
|borrowings||||||Reporting Period|
|Deferred income|519,783,531.6||||||
|||8.93%|388,022,097.64|7.19%|1.74%|The increased deductible losses|
|tax assets|4||||||
|Other non-current|108,971,942.0||||||
|||1.87%|0.00||1.87%|Paying for the investment|
|assets|0||||||
|Advances from|265,338,215.3|||||Settlement of real estate project in|
|||4.56%|516,984,711.11|9.59%|-5.03%||
|customers|4|||||Reporting Period|
|||||||Decrease of surplus of specific|
|Other non-current|||||||
||52,937,180.81|0.91%|54,543,253.27|1.01%|-0.10%|maintenance funds of property|
|liabilities|||||||
|||||||management subsidiary|

2. Assets and Liabilities at Fair Value
√ Applicable□ Not applicable
Unit: RMB
|||||||||
|-|-|-|-|-|-|-|-|
||Beginningamount|Gain/loss on|Cumulative|||||
|||||Impairmentallowance forthe ReportingPeriod||||
|||fair-value|fair-value||Purchased in|Sold in the||
||||||||Ending|
|Item||changes in the|changes||the Reporting|Reporting||
||||||||amount|
|||Reporting|charged to||Period|Period||
|||Period|equity|||||
|Financial assets||||||||
|3.|3,591,209.20||30,171.91||||3,621,381.11|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||
|-|-|-|-|
|Available-for-sa||||
|le financial||||
|assets||||
|Subtotal of||||
||3,591,209.20|30,171.91|3,621,381.11|
|financial assets||||
|Total of the||||
||3,591,209.20|30,171.91|3,621,381.11|
|above||||
|Financial||||
||0.00||0.00|
|liabilities||||

Significant changes to the measurement attributes of the major assets in the Reporting Period:
□ Yes√ No
3. Restricted Asset Rights as at the Period-End
TheCompany‘s subsidiary Dongguan ITC Changsheng Real Estate Development Co., Ltd. is a tentatively qualified real estate development enterprise. During the application for the pre-sale permit for commodity houses, it is required to submit the commercial housing quality guarantee letter after the bankruptcy and dissolution of the enterprise. After Dongguan ITC Real Estate Development Co., Ltd. paid the deposit of RMB 12,402,160.00 to the Bank of Communications Dongguan Dalang Branch for issuing 9 irrevocable commercial housing rental quality guarantee letters, of which, one letter was valued at RMB 1,468,870.00 with the valid guarantee period from 30 June 2015 to 31 December 2020, and the remaining 8 letters RMB 10,933,290.00 from 1 July 2015 to 31 December 2020. As of 31 December 2018, the Company retrieved all original letters from the Land and Resources Bureau.
 As a real estate developer, the Company provided purchasers of commercial residential building with mortgage guarantee and paid cash deposits of loans according to the operation convention in real estate industry. As of 31 December 2018, the balance of cash deposits not releasing guarantee was of RMB1,117,507.63, and the guarantee will be released when mortgage is paid off.
V Investments Made
1. Total Investment Amount
□ Applicable√ Not applicable
2. Major Equity Investments Made in the Reporting Period
□ Applicable√ Not applicable
3. Major Non-Equity Investments Ongoing in the Reporting Period
□ Applicable√ Not applicable
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 4. Financial Investments
(1) Securities Investments
√ Applicable□ Not applicable
Unit: RMB
|||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
|||||||Gain/Lo||||||||
||||||||Accumu||||||Source|
|||||||ss on||||||||
||||||||lated|||||||
|Variety|||Initial|Account|Beginni|fair|fair|Purchas|Sold in|Gain/los|||of|
||Code of|Name of||ing||value||ed in||s in|Ending|Account||
|of|||investm|measure|ng|changes|value|Reporti|Reporti|Reporti|carrying||investm|
||security|security|||carrying||changes||ng|||ing title||
|security|||ent cost|ment|value|in|charged|ng|Period|ng|value||ent|
|||||method||Reporti||Period||Period||||
|||||||ng|to||||||funds|
||||||||equity|||||||
|||||||Period||||||||
||||||||||||||Obtaine|
|||||||||||||Availabl||
|||Gintian|||||||||||d in|
|Domesti||||Fair||||||||e-for-sal||
||400016,|A,|3,565,8||3,591,2||30,171.||||3,621,3||Gintian‘|
|c/Foreig||||value||||||||e||
||420016|Gintian|56.06||09.20||91||||81.11||s debt|
|n stock||||method||||||||financia||
|||B|||||||||||restructu|
|||||||||||||l asset||
||||||||||||||ring|
||||3,565,8||3,591,2||30,171.||||3,621,3|||
|Total||||--||0.00||0.00|0.00|0.00||--|--|
||||56.06||09.20||91||||81.11|||
|Disclosure date of||||||||||||||
|announcement on Board‘s||||||||||||||
|consent for securities||||||||||||||
|investment||||||||||||||
|Disclosure date of||||||||||||||
|announcement on||||||||||||||
|shareholders‘ meeting‘s||||||||||||||
|consent for securities||||||||||||||
|investment (if any)||||||||||||||

(2) Investments in Derivative Financial Instruments
□ Applicable√ Not applicable
No such cases in the Reporting Period.
5. Use of Funds Raised
□ Applicable√ Not applicable
No such cases in the Reporting Period
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 VI Sale of Major Assets and Equity Interests
1. Sale of Major Assets
□ Applicable√ Not applicable
No such cases in the Reporting Period.
2. Sale of Major Equity Interests
□ Applicable√ Not applicable
VII Major Subsidiaries
√ Applicable□ Not applicable
Major fully/majority-owned subsidiaries and those minority-owned subsidiaries with an over10% effect on theCompany‘s net profit: Unit: RMB
||||||||||
|-|-|-|-|-|-|-|-|-|
||Relationship||||||||
|||Principal|Registered|||Operating|Operating||
|Name||||Total assets|Net assets|||Net profit|
||with the||||||||
|||activity|||||||
||||capital|||revenue|profit||
||Company||||||||
|Shenzhen|||||||||
|||Development|||||||
|Huangcheng|||30,000,000.0|1,246,825,73|162,179,009.|79,799,612.5|||
||Subsidiary|and sales of|||||3,101,585.73|2,657,622.33|
|Real Estate|||0|0.89|56|9|||
|||real estate|||||||
|Co., Ltd.|||||||||
|SZPRD|||||||||
|Xuzhou|||||||||
|||Development|||||||
|Dapeng Real|||50,000,000.0|370,070,631.|-109,480,636|122,209,577.|21,152,530.1|21,289,416.2|
||Subsidiary|and sales of|||||||
|Estate|||0|55|.35|13|4|9|
|||real estate|||||||
|Development|||||||||
|Co., Ltd.|||||||||
|Dongguan|||||||||
|ITC|||||||||
|||Development|||||||
|Changsheng|||20,000,000.0|447,597,292.|262,735,716.|247,296,018.|110,757,985.|80,762,210.8|
||Subsidiary|and sales of|||||||
|Real Estate|||0|23|03|72|92|5|
|||real estate|||||||
|Development|||||||||
|Co., Ltd.|||||||||
|SZPRD|||||||||
|Yangzhou||Development|||||||
|||||347,048,899.|77,589,765.1|554,889,563.|87,465,303.7|75,603,493.9|
|Real Estate|Subsidiary|and sales of|50000000||||||
|||||87|1|08|1|3|
|Development||real estate|||||||
|Co., Ltd.|||||||||
|Shenzhen||Property||469,980,871.|86,894,350.5|482,067,279.|32,701,494.8|23,923,135.2|
||Subsidiary||20000000||||||
|International||management||08|0|18|8|7|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||
|-|
|Trade Center|
|Property|
|Management|
|Co., Ltd.|

Subsidiaries obtained or disposed in the Reporting Period:
√ Applicable□ Not applicable
||||
|-|-|-|
||How subsidiary was obtained or disposed|Effects on overall operations and operating|
|Subsidiary|||
||in the Reporting Period|performance|
|Shangdong SZITC Hotels Managements||Income was of RRMB 1.7278million, and|
||Newly established||
|co., Ltd||net profit was of RMB -60,000|
|||Income was of RMB0, and net profit|
|Yangzhou Slender West Lake Jingyue|||
||Newly established|attributable to the Company as the Parent|
|Property Development Co., Ltd|||
|||was of RMB -64,600|

Information about major majority- and minority-owned subsidiaries:
VIII Structured Bodies Controlled by the Company
√ Applicable□ Not applicable
For details, see IX 1. Equity interests in subsidiaries in Section XI Financial Report herein.
IX Prospects
(I) Development Environment Analysis
Refer to "2. Analysis of Industry Pattern and Trend" in "Section IV: Discussion and Analysis of Business Situation"
(II) Company Development Situation in 2019
Compared with the uncertainties in material transition of team, insufficient land reserve, low team passion, etc., the internal and external uncertainties faced by the group will be obviously reduced, and the directions and goals will be clearer in 2019. Through the solid work and joint efforts of the group in 2018, the main orientation of the group's entrepreneurship has been established, and the bottleneck of land reserve that restricts the sustainable development of the group has been initially alleviated. The orientation of the main company and platform company of the investment control company has taken shape and gained initial recognition, and the confidence to accelerate the reform and development of the group has been enhanced. At present, what we need to do is execute the normal work of "sowing in spring and harvesting in autumn", concentrate on doing our own things well, highlight the two key directions of incremental expansion and development, stock optimization and realization, maintain strategic determination, and maintain the strategic determination, rhythm and intensity, keep working passion, accurately grasp the opportunity, dare to act to ensure the completion of the target tasks throughout the year.
(III) Revision and Adjustment of theCompany’s Future Development Strategy
As the traditional real estatemarket‘s development declines on the whole, various industrial resources have been continuously occupied by the large-scale brand houses, which has threatened the survival and development of medium and small-sized property companies.―Large-scale Enterprises Taking AllAdvantages‖ has become normal in the industry, and the positioning of―Houses are
for living in, not for speculatingon‖ has already been established. In this case, Shenzhen Properties& Resources Development
(Group)Ltd. specialized in the traditional real estate will be confronted with the extremely severe industrial situation. In order to
implement the overall strategic layout formulated by Land and Resources Bureau of Shenzhen Municipality, the Company has made
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 great effort to seek effective breakthroughs, thoroughly connected with the system of Land and Resources Bureau, kept abreast of the major strategic orientation featuring gradient of layers and multiple industrial parks in one district and combined fund control, and learned from the leading enterprises in the benchmarking industry. By means of strategic thinking, analysis& conclusion and research& demonstration in 2018, the Company accordingly revised and adjusted its 13th five-year strategic plan, and put forward the development vision of―Becoming Top 1 Intelligent Technology Industrial Park Full Eco-chain Integrated Operator in China and even Leading theWorld‖. Through following the overwhelming trend of the real estate market from the age of increments to the age of stocks and seizing the golden opportunity posed by the transformation of the social major contradiction, the Company has attached great importance to the key points of stockassets‘ value management and industrial and ecological operation services, propelled the high-quality development based on new development ideas and satisfiedpeople‘s longings for better life.
In this context, the Company put forward the―12345‖ overall development idea of―1 Vision+ 2 Major Sectors+ 3 Driving Factors+ 4 Businesses+ 5 Value-addedServices‖. In other words, the Company will take effective measures with the focus on―Hi-tech IndustrialPark‖ and―ResidentCommunity‖, and relying on the driving innovation power, the leverage of capital and the platform linkage mechanism as the inexhaustible motive force for development, pay special attention to develop four major businesses through expanding the main business and making breakthroughs including the urban space development, the industrial ecological operation, property management services, and high-end value-added services. Meanwhile, the Company will realize the rapid deployment and integration of five major value-added services including financial services, life health, pension services, education services, and AI+ services.
The Company will moderately deploy the high-quality heavy-asset operating properties, and the highly market-operated light-assets operating properties, and simultaneously carry out the heavy-assets operation and the light-assets operation with the priority given to the light-assets operation, highlighting the asset value management capability, the industrial ecological operational capability and the channel resources platform integration capability; the Company will also strengthen the driving role played by the strategic objective, establish the humanistic thought, broaden the horizon of human resources allocation, build and improve the mechanism and proportion of all employees to share various development results, and strive to shape a beautiful life scene. In 2025, the Company will make its four business segments advance side by side, complement each other, realize the coordinated development, catch up with and surpass theworld‘s advanced level. With strong comprehensive strength and unique brand advantages, it will become Top 1 Intelligent Technology Industrial Park Full Eco-chain Integrated Operator in China and even Leading the World, and further promote the core competitiveness of Shenzhen.
(IV) Major Works and Tasks for 2019
We should do a good job in the guiding ideology for the group's work in 2019: Guided by Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, we should implement and carry out the important speech spirit that General Secretary Xi Jinping visited Guangdong, grasp the major opportunity of Shenzhen State-owned Enterprises in the new round of large-scale reform and integration taking the opportunity of the Municipal SASAC to promote the "Regional State-owned Enterprises Comprehensive Reform Experimental Zone", coordinate with the investment control company to be selected into "Double Hundred Action" for the reform of state-owned enterprises, and create a municipal science and technology control platform and Benchmarking Temasek and other key strategies; Positioned in the main company and platform company of investment control system, we should make efforts and concentrate efforts to fight against "sales payback, project construction landing and capital operation", continue to vigorously promote a multi-level incentive mechanism, vigorously select and train young talents, vigorously enhance the capacity and level of the group's modern enterprise system construction, and enhance the sense of modernity, vitality and awareness of the group's governance image, continue to promote the building of a clean and honest party style and the implementation of the "two responsibilities"; We should advocate for practical work, support practical work, reward practical work, be honest in starting a business, strengthen confidence, maintain determination, and comprehensively embark on a new journey of building China's first and leading integrated operator of the whole ecological chain of intelligent science and technology parks in the world, and go all out to accomplish the goals and tasks of 2019.
Firstly, the Company shall seize the opportunity and take the initiative to occupy three heavily-fortified positions,
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 continuously reinforce its development potentials and firmly promote thegroup’s high-quality development. Strictly adhering to the functional orientation of establishing the main Company and the platform Company, the Company will accordingly take the initiative to occupy three heavily-fortified positions in relation Sales Outstanding, Commencement of Project Construction and Capital Operation, and flexibly apply various marketing methods to guarantee the full completion of sales of Golden Collar Project. In the year, the returned funds from various projects shall be guaranteed at RMB 4,000 million and even at RMB 5,000 million. In the year 2019, 1 or 2 city-industry integration project(s) will be implemented in Shenzhen with the total construction area no less than 300,000 square meters. Besides, if possible, various city-industry integration projects will also be carried out in Zhaoqing, Yangzhou and Chongqing, and it is estimated that the total newly-added land reserves would be no less than 500mu (1,000mu at most). Regarding the hi-end hi-tech industrial parks, office buildings, commercial buildings, cultural tourism and municipal engineering as key points, the Company will expand the property management area no less than 10 million square meters by means of mergers and acquisitions. By occupying three heavily-fortified positions, theCompany‘s development potentials will be further enhanced. In addition, the Company will continuously optimize its business development structure, improve its business development quality, strive to realize the high-quality foundation, operation level and development potentials, and firmly drive theCompany‘s high-quality growth.
Secondly, the Company will spare no effort to guarantee the fulfillment of annual business target. Based on the comprehensive budget, the Company will effectively implement the budget plan, figure out various in-depth potential factors and formulate the operating budget for the year 2019 in a scientific and reasonable way, complete various budget objectives, carry out strict assessment work and properly implement the supervision and inspection. Various branches not involved in the real estate are required to increase the income and reduce the expenditure, save the cost and improve the efficiency, contributing to the increase of operating profits of the group. Meanwhile, great effort shall also be made to promote the project marketing, adjust various marketing strategies based on the market changes, flexibly make use of different marketing methods and master various key opportunities. The early sales, quick sales and large sales strategy must be firmly implemented for Qianhai Gangwan Garden Project and Dongguan Songhu Langyuan Project so as to sell out all houses, realize the goal of selling up all houses in Block B of GoldenCollar‘s Resort Apartment and the cash sales of Block C, accelerate the return of capital and strengthen the collection of accounts receivables.
Thirdly, the Company shall stick to the development strategy of externally expanding its property management business, realize its large-scale expansion, enhance its core competitiveness and expand the brand influence. By learning from the leading enterprise within the bench-marking industry, the Company will seek ways for expanding its property management business to the overseas market, and facilitate the Company to transform from the supplier of traditional property management services to the supplier of internationalized and modernized comprehensive social services. Regarding high-end high-tech industrial parks, cultural tourism, municipal engineering and medium and high-end residence communities as key points, the Company will realize its large-scale expansion by means of merges and acquisitions and the establishment of industrial acquisition fund, emphasize the improvement of various competitive advantages in the field of industrial parks, continuously improve the service innovation ability, form the unique brand influence and core competitiveness, enhance the introduction and training of core property management cadres and talents, and establish the talent base for its rapid expansion. In this year, the Company shall try its best to make the expanded property management area no less than 10 million square meters and the self-developed area no less than 1 million square meters. Fourthly, the Company shall introduce the brand strategy, improve the business scale and make full use of the operating efficiency of the leasing assets. From three major perspectives such as the reform, the transformation and the sustainable development, the Company will proceed from the increment expansion, the transformation of stocks and the quality and efficiency improvement to realize the comprehensive operation of five long-term rental apartment stores including Longhua Complex, ONE39 Building, Xinhu Village, Fumin Complex and Chuanbu Street Phase I, and the food court in the ITC Plaza. In addition, it is expected to add the rental income about RMB 10 million Yuan and the total revenue about RMB 80 million Yuan, straighten out and perfect various management works related to the rental operation Company, comprehensively strengthen the business operation and management capability, introduce the brand strategy and improve the business scale.
Fifthly, the Company will insist on the comprehensive deepening of the reform, further optimize the system, define the
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 power-responsibility system, firmly implement the system and strengthen the development momentum. The Company must respect the laws of the market, optimize the rational allocation of resources, and effectively establish a mechanism for sharing benefits. Meanwhile, it is required to strengthen the market-oriented management in the business areas of group real estate, property management, and long-term rental apartments etc., improve the decision-making efficiency and level, rationally allocate resources according to the rules of market value, provide all necessary support, and ensure the unification of―efficiency, benefits andeffects‖. At the same time, the Company will strive to complete theGroup‘s internal remuneration reform plan, and implement various incentive and restraint systems including the real estate project investment system, fully introduce the incremental sharing mechanism, strengthen the assessment, lay the common material benefits foundation for allmembers‘ fulfillment of core values such as Concentric Effort, Co-creation and Sharing, and guarantee the long-term, stable and sustainable development of the Group. In the sixth step, the Company shall focus on the new mission for its development, continuously strengthen its basic management ability, firmly hold on to “six improvements” and help the Group become the first-class enterprise in this industry. First, the Company must pay close attention to the promotion of corporate brand culture, promote the group brand building and the re-thinking of corporate culture, form a consistent brand strategy and cultural identity; second, it must pay close attention to the management and control process, comprehensively sort out thegroup‘s management process, operation mechanism and authorization system so as to realize the business process optimization and re-engineering, cooperate with the process management, simultaneously promote the optimization and integration of theGroup‘s OA system, and formulate and introduce theGroup‘s five-year informationization plan; third, the Company must focus on the standardization of products and services, actively promote the standardization of theGroup‘s real estate, leasing and property management products and services, form various advantages related to the systemization, branding and standardization, and establish the service standards geared to Shenzhen Bay Park; it is also required to strengthen the construction of technology centers, and initially establish theGroup‘s innovation platform to significantly promote theGroup‘s overall technological innovation capability; fourth, the Company must attach great importance to the financial management and control improvement, officially operate theGroup‘s fund settlement center within the year in accordance with theGroup‘s management objectives and operational requirements of―one network, one table, one process and onepool‖ so as to realize the centralized management of the entireGroup‘s funds, simultaneously explore and establish the financial sharing center model, and fully play the primary and driving role of the financial management and control in the group management and control; fifth, the Company must make great effort to improve the standardization of safety production, complete the construction of the safety production standardization system, carry out various mechanisms such as the founding of institution, the personnel allocation, implementation of benefits, and realization of rewards and punishments etc. and fully take theenterprise‘s main responsibilities for safety production. Finally, emphasis must be placed on the improvement of theGroup‘s comprehensive risk management and control system, especially the strengthening of the construction of the top-level design and basic norm system in relation to the group-level policy compliance risks, integrity prevention and control risks and investment decision-making risks. Further, it is required to re-organize and pre-judge historical stock litigation cases, propose the overall solutions, and resolutely prevent possible subversive risks.
In the seventh step, the Company shall take the party construction as the guide and continuously strengthen the construction of party organization. In this case, it is required to complete the construction of the reform and opening-up exhibition hall on the 42nd floor of the ITC Building and open it to the outside world, fully demonstrate the profound historical heritage of the Group, write the story of spring in the spirit of―International TradeCenter‖, and reshape theSZPRD‘s brand image of―Dare to be the First and Become Stronger throughReform‖; the Company will also follow the correct political orientation, obey the overall service situation, highlight the problem orientation, uphold the strict, careful, and practical work style, strictly implement the overall responsibility of strictly administering the party, give full play to the role of discipline building in addressing both symptoms and root causes, guarantee the actual implementation of theparty‘s line, principles, policies, and major decisions, fully play the political core role and the vanguard and exemplary role of the party organization.
(V) Analysis of theCompany’s Possible Risks
1. Market-related Risks
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 There exists a great correlation between the real estate industry and the macro economy. TheCompany‘s income mainly comes from real estate development, which is greatly affected by the macroeconomic development cycle. Generally, in the rising stage of the macroeconomic cycle, the investment prospects and market demand of the real estate industry will be optimistic, and the real estate prices and transaction volume will rise; on the contrary, market demand will shrink, and the real estate prices and trading volume will fall accordingly with increased operating risks and declined income on investment. In addition, the real estate industry is highly correlated with the overall operation of the national economy, and as a typical industry largely depending on various resources, it is greatly affected by thegovernment‘s macroeconomic policies. Since the third quarter of 2016, the central government has proposed that―houses are for living in, not for speculatingon‖, and various provinces and municipalities have successively introduced restrictions on purchases, limits on loans and related financial regulation policies to guide and promote the sustainable, stable and healthy development of the real estate industry, which will have a direct impact on the operation and development of real estate development enterprises. Therefore, whether the Company can adjust its business strategy and investment behavior in a timely manner in response to the change in the industry cycle and the adjustment of industrial policies will greatly affect theCompany‘s performance.
2. Land Reserve Risk
TheCompany‘s lack of land reserves and insufficient development stamina still exists. In the current favorable situation for sales of real estate projects and theCompany‘s funds, various resources for land investment will be increased in the future. In addition to the emphasis placed on the targetcity‘s land bidding and auction information, it will also strengthen the study on other cooperative development modes includingM&A so as to replenish land reserves as soon as possible.
3. Financing Risk
In the process of actively increasing land reserves and accelerating the business development, the Company needs to invest a large amount of funds for land acquisition and project development. In addition to its own funds, theCompany‘s project development funds need to be externally financed through bank loans and issuing securities. If thecountry‘s macroeconomic situation, credit policy and capital market undergo major changes or adjustments, it may lead to restrictions on theCompany‘s financing or theCompany‘s financing costs, which will adversely affect theCompany‘s production and operation.
The above business plan and business objectives do not represent the listedCompany’s profit forecast for 2019. Whether it can be achieved depends on various factors including changes in market conditions and the effort made by the management team. Investors must pay special attention to that because there exists huge uncertainty.
X Communications with the Investment Community such as Researches, Inquiries and Interviews
1. During the Reporting Period
√ Applicable□ Not applicable
|||||
|-|-|-|-|
|||Type of communication|Index to main information|
|Date|Way of communication|||
|||party|communicated|
||||Inquired of relevant questions about|
||||strategic cooperation of the Company|
|11 January 2018|By phone|Individual||
||||with CASTD, and the future|
||||development of the Company|
||||Inquired of the forecast of annual report|
|31 January 2018|By phone|Individual||
||||of the Company|
|31 January 2018|By phone|Individual|Inquired of the basic information and|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||||
|-|-|-|-|-|
|||||trend of stock prices of the Company|
|||||Inquired of the operation conditions and|
|1 February 2018|By phone||Individual||
|||||trend of stock prices of the Company|
|||||Inquired of the trend of stock prices of|
|7 February 2018|By phone||Individual||
|||||the Company|
|||||Inquired of the performance of thee|
|9 April 2018|By phone||Individual||
|||||Company this year|
|||||Inquired of the forecast reduction in first|
|12 April 2018|By phone||Individual||
|||||quarter of the Company|
|||||Inquired of the development of|
|19 April 2018|By phone||Individual|long-term rental apartment of the|
|||||Company|
|||||Inquired of the development of|
|23 April 2018|By phone||Individual|long-term rental apartment of the|
|||||Company|
|||||Inquired of the performance of the|
|||||Company, forecast reduction of|
|10 October 2018|By phone||Individual||
|||||performance in third quarter of the|
|||||Company|
|||||Inquired of the forecast reduction of|
|10 October 2018|By phone||Individual|performance in third quarter of the|
|||||Company|
|||||Inquired of the reasons for falling stock|
|17 October 2018|By phone||Individual||
|||||prices of the Company|
|||||Inquired of the reasons for falling stock|
|18 October 2018|By phone||Individual||
|||||prices of the Company|
|||||Inquired of the reasons for falling stock|
|18 October 2018|By phone||Individual||
|||||prices of the Company|
|||||Inquired of the current operation|
|7 November 2018|By phone||Individual|conditions of the Company and the|
|||||opening of Golden Collar Project|
|||||Inquired of the current operation|
|7 November 2018|By phone||Individual|conditions of the Company and the|
|||||opening of Golden Collar Project|
|||||Inquired of the acquisition of TK|
|14 December 2018|By phone||Individual||
|||||Property|
|||||Inquired of the acquisition of TK|
|18 December 2018|By phone||Individual||
|||||Property|
|Times of communications||18|||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||
|-|-|
|Number of institutions communicated with|0|
|Number of individuals communicated with|18|
|Number of other communication parties|0|
|Tip-offs or leakages of substantial||
|supposedly-confidential information during|None|
|communications||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Part V Significant Events
I Profit Distributions to Ordinary Shareholders (in the Form of Cash and/or Stock)
How the profit distribution policy, especially the cash dividend policy, for ordinary shareholders was formulated, executed or revised in the Reporting Period:
□ Applicable√ Not applicable
The profit distributions to ordinary shareholders, either in the form of cash or stock, in the past three years (including the Reporting Period) are summarized as follows:
|||
|-|-|
|Year|Profit distributions (in the form of cash or stock)|
|2018|A cash dividend of RMB3.00 (tax included) per 10 shares and no share capital increase from capitalreserve|
|2017|A cash dividend of RMB1.80 (tax included) per 10 shares and no share capital increase from capitalreserve|
|2016|A cash dividend of RMB0.80 (tax included) per 10 shares and no share capital increase from capitalreserve|

Cash dividend for ordinary shareholders in the past three years (including the Reporting Period):
Unit: RMB
|||||||||
|-|-|-|-|-|-|-|-|
|||Net profit||||||
|||attributable to||||||
|||ordinary||||Total cash||
||Cash|shareholders||Cash dividends||dividends||
||||A as % of B||C as % of B||D as % of B|
|Year|dividends (tax|of the listed||in other forms||(including||
||||(%)|(such as share|(%)||(%)|
||inclusive) (A)|company in||repurchase) (C)||those in other||
|||consolidated||||forms) (D)||
|||statements for||||||
|||the year (B)||||||
|2018|178,793,727.60|592,723,852.71|30.16%|0.00|0.00%|178,793,727.60|30.16%|
|2017|178,793,727.60|622,962,734.37|28.70%|0.00|0.00%|178,793,727.60|28.70%|
|2016|107,276,236.56|354,857,241.74|30.23%|0.00|0.00%|107,276,236.56|30.23%|

 Indicate by tick mark whether the Company fails to put forward a cash dividend proposal for the ordinary shareholders despite the facts that the Company has made profits in the Reporting Period and the profits of the Company as the parent distributable to the ordinary shareholders are positive.
□ Applicable√ Not applicable
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 II Final Dividend Plan for the Reporting Period
√ Applicable□ Not applicable
|||
|-|-|
|Bonus shares for every 10 shares (share)|0|
|Dividend for every 10 shares (RMB) (tax inclusive)|3.00|
|Additional shares to be converted from capital||
||0|
|reserve for every 10 shares (share)||
|Total shares as the basis for the profit distribution||
||595,979,092.00|
|proposal (share)||
|Cash dividends (RMB) (tax inclusive)|178,793,727.60|
|Cash dividends in other forms (such as share||
||0.00|
|repurchase) (RMB)||
|Total cash dividends (including those in other||
||178,793,727.60|
|forms) (RMB)||
|Distributable profit (RMB)|2,080,513,737.62|
|Total cash dividends (including those in other||
||100%|
|forms) as % of total profit distribution||
|Cash dividend policy||
|If the Company is in a mature development stage and has no plans for any significant expenditure, in profit allocation, the ratio of||
|cash dividends in the profit allocation shall be 80% or above.||
|Details about the proposal for profit distribution and converting capital reserve into share capital||
|According to the Company‘s Articles of Association as well as the actual situation of its development and operation, the proposal of||
|the Company for 2018 annual profit distribution is as follows: Based on the total 595,979,092 shares of the Company as at 31||
|December 2018, a cash dividend of RMB3.00 (tax included) will be distributed to all its shareholders for every 10 shares they hold,||
|with the total cash dividends to be distributed amounting to RMB178,793,727.60. And the retained profits will be carried over for||
|distribution in the future. No capital reserves will be turned into share capital for 2018.||

III Fulfillment of Commitments
1. Commitments of theCompany’s Actual Controller, Shareholders, Related Parties and Acquirers, as well as the Company Itself and other Entities Fulfilled in the Reporting Period or Ongoing at the Period-end□ Applicable√ Not applicable
No such cases in the Reporting Period.
2. Where there had been an earnings forecast for an asset or project and the Reporting Period was still within the forecast period, explain why the forecast has been reached for the Reporting Period.
□Applicable√ Not applicable
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 IV Occupation of theCompany’s Capital by the Controlling Shareholder or Its Related Parties for Non-Operating Purposes
□ Applicable√ Not applicable
No such cases in the Reporting Period.
V Explanations Given by the Board of Directors, the Supervisory Board and the Independent Directors (if any) Regarding the Independent Auditor's “Modified Opinion” on the Financial Statements of the Reporting Period
□ Applicable√ Not applicable
VI YoY Changes to Accounting Policies, Estimates and Methods
□ Applicable√ Not applicable
No such cases in the Reporting Period.
VII Retrospective Restatements due to Correction of Material Accounting Errors in the Reporting Period
□ Applicable√ Not applicable
No such cases in the Reporting Period.
VIII YoY Changes to the Scope of the Consolidated Financial Statements
√ Applicable□ Not applicable
For the detailed changes to theCompany‘s consolidated statements of the Reporting Period, see―Part XI FinancialStatements‖, VIII. IX Engagement and Disengagement of Independent Auditor
Current independent auditor:
|||
|-|-|
|Name of the domestic independent auditor|Ruihua Certified Public Accountants (LLP)|
|The Company‘s payment to the domestic independent auditor||
||63|
|(RMB‘0,000)||
|How many consecutive years the domestic independent auditor||
||1|
|has provided audit service for the Company||
|Names of the certified public accountants from the domestic||
||Cai Xiaodong and Wang Huansen|
|independent auditor writing signatures on the auditor‘s report||
|How many consecutive years the certified public accountants||
||1|
|have provided audit service for the Company||

Indicate by tick mark whether the independent auditor was changed for the Reporting Period.
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018√ Yes□ No
Indicate by tick mark whether the independent auditor was changed during the audit period.
□ Yes√ No
Indicate by tick mark whether an approval procedure was implemented for the change of independent auditor.
√ Yes□ No
Further details about the change of independent auditor:
TheCompany‘s original audit institution, Mazars Certified Public Accountants (SGP) (hereinafter referred to as―MazarsCPA‖) adhered to the principle of independent audit in the course of practicing, and reflected the financial status of the Company in an objective, fair and impartial way, earnestly fulfilled their due responsibilities, and effectively safeguarded the legitimate rights and interests of the Company and its shareholders from a professional perspective.
As the employment of Mazars CPA has expired and the audit team serving the Company has provided audit services for the Company for more than 15 consecutive years, according to relevant regulations of China Securities Regulatory Commission and State-Owned Assets Supervision Administration of Shenzhen Municipality, in order to ensure the independence and objectiveness of theCompany‘s audit work, and comprehensively take into account the needs of theCompany‘s business development and future audits, the Company held the annual meeting of board of directors andshareholders‘ meeting respectively on 29 March 2018 and 15 June 2018, and hired Ruihua Certified Public Accountants (special general partnership) as theCompany‘s annual financial statements and the internal control auditing agency at the cost of RMB 850,000. The proposal has been approved by the board of directors and the shareholders meeting respectively.
Independent auditor, financial advisor or sponsor engaged for the audit of internal controls:
√ Applicable□ Not applicable
In this Reporting Period, the Company engaged Ruihua Certified Public Accountants (LLP) for its internal control audit and paid an internal control audit fee of RMB220,000 to it for the year.
X Possibility of Listing Suspension or Termination after Disclosure of this Report
□ Applicable√ Not applicable
XI Insolvency and Reorganization
□ Applicable√ Not applicable
No such cases in the Reporting Period.
XII Major Legal Matters
□ Applicable√ Not applicable
No such cases in the Reporting Period.
XIII Punishments and Rectifications
□ Applicable√ Not applicable
No such cases in the Reporting Period.
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 XIV Credit Quality of the Company as well as Its Controlling Shareholder and Actual Controller
□ Applicable√ Not applicable
XV Equity Incentive Plans, Employee Stock Ownership Plans or Other Incentive Measures for Employees
□ Applicable√ Not applicable
No such cases in the Reporting Period.
XVI Major Related-Party Transactions
1. Continuing Related-Party Transactions
□ Applicable√ Not applicable
No such cases in the Reporting Period.
2. Related-Party Transactions Regarding Purchase or Sales of Assets or Equity Interests
□ Applicable√ Not applicable
No such cases in the Reporting Period.
3. Related Transactions Regarding Joint Investments in Third Parties
□ Applicable√ Not applicable
No such cases in the Reporting Period.
4. Credits and Liabilities with Related Parties
√Applicable□ Not applicable
Indicate by tick mark whether there were any credits and liabilities with related parties for non-operating purposes.
√ Yes□ No
Receivable from related parties
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
||||Capital|||||||
||||||Amount|||||
|||||||Amount||||
||||occupation|Beginning|newly||||Ending|
||Relationshi|||||received in||Current||
|Related|||for|balance|added in|current||interest|balance|
||p with the|Reason|||current||Interest rate|||
|||||||period||(RMB‘0,00||
|party|||non-operati|(RMB‘0,00|period||||(RMB‘0,000|
||Company||||(RMB‘0,00|(RMB‘0,00||0)||
||||ng purposes|0)||0)|||)|
||||||0)|||||
||||(yes/no)|||||||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||||
|-|-|-|-|-|-|
|Anhui|30%|||||
|||Business||||
|Nanpeng|equities|||||
|||circulating|No|813|813|
|Papermakin|held by the|||||
|||funds||||
|g Co., Ltd.|Company|||||
|Shenzhen||||||
|Wufang|26%|||||
|||Business||||
|Pottery &|equities|||||
|||circulating|No|175|175|
|Porcelain|held by the|||||
|||funds||||
|Industrial|Company|||||
|Co., Ltd.||||||
|Influence on the||||||
|Company‘s operating||All were within the risks control of the Company and not influenced the operating results and the||||
|results and financial||financial conditions.||||
|condition||||||

Liabilities payable to related parties
||||||||||
|-|-|-|-|-|-|-|-|-|
|||||Amount|Amount||||
||||Beginning|newly added|returned in||Current||
||Relation with|Formation|||||||
|Related party|||balance|in current|current|Interest rate|interest|Ending|
||the Company|reason|||||||
||||(RMB‘0,000)|period|period||(RMB‘0,000)|balance(RMB|
|||||(RMB‘0,000)|(RMB‘0,000)|||‘0,000)|
|Shenzhen Jifa|||||||||
|||Intercourse|||||||
|Warehouse|Joint venture||2,630|||||2,630|
|||funds|||||||
|Co., Ltd.|||||||||
|Shenzhen|||||||||
|Tian‘an|||||||||
|International|||||||||
|||Intercourse|||||||
|Building|Joint venture||521|||||521|
|||funds|||||||
|Property|||||||||
|Management|||||||||
|Co., Ltd.|||||||||
|Influence on the Company‘s|||||||||
|||Were all within the risks control of the Company and not influenced the operating results and the|||||||
|operating results and|||||||||
|||financial conditions.|||||||
|financial condition|||||||||

5. Other Major Related-Party Transactions
□ Applicable√ Not applicable
No such cases in the Reporting Period.
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 XVII Major Contracts and Execution thereof
1. Entrustment, Contracting and Leases
(1) Entrustment
□ Applicable√ Not applicable
No such cases in the Reporting Period.
(2) Contracting
□ Applicable√ Not applicable
No such cases in the Reporting Period.
(3) Leases
□ Applicable√ Not applicable
No such cases in the Reporting Period.
2. Major guarantees
√ Applicable□ Not applicable
(1) Guarantees
Unit: RMB'0,000
||||||||||
|-|-|-|-|-|-|-|-|-|
|Guarantees provided by the Company as the parent and its subsidiaries for external parties (exclusive of those for subsidiaries)|||||||||
||Disclosure||||||||
|||||||||Guarante|
||date of the||||||||
|||||Actual|||Having|e for a|
||guarantee|Line of|Actual||Type of|Term of|||
|Obligor||||guarantee|||expired|related|
||line|guarantee|occurrence date||guarantee|guarantee|||
|||||amount|||or not|party or|
||announcem||||||||
|||||||||not|
||ent||||||||
|Guarantees provided by the Company as the parent for its subsidiaries|||||||||
||Disclosure||||||||
|||||||||Guarante|
||date of the||||||||
|||||Actual|||Having|e for a|
||guarantee|Line of|Actual||Type of|Term of|||
|Obligor||||guarantee|||expired or|related|
||line|guarantee|occurrence date||guarantee|guarantee|||
|||||amount|||not|party or|
||announcem||||||||
|||||||||not|
||ent||||||||
|Shenzhen||||||20 July 2018|||
||29 March||||General||||
|Huangcheng Real||75,000|20 July 2018|100||to 20 June|No|Yes|
||2018||||guaranty||||
|Estate Co., Ltd.||||||2021|||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||||||||
|-|-|-|-|-|-|-|-|-|
|Total approved line for such||||Total actual amount of such|||||
|guarantees in the Reporting Period||75,000||guarantees in the Reporting||100|||
|(B1)||||Period (B2)|||||
|Total approved line for such||||Total actual balance of such|||||
|guarantees at the end of the||75,000||guarantees at the end of the||100|||
|Reporting Period (B3)||||Reporting Period (B4)|||||
|Guarantees provided between subsidiaries|||||||||
||Disclosure||||||||
|||||||||Guarante|
||date of the||||||||
|||||Actual|||Having|e for a|
||guarantee|Line of|Actual||Type of|Term of|||
|Obligor||||guarantee|||expired|related|
||line|guarantee|occurrence date||guarantee|guarantee|||
|||||amount|||or not|party or|
||announcem||||||||
|||||||||not|
||ent||||||||
|Total guarantee amount (total of the three kinds of guarantees above)|||||||||
|||||Total actual guarantee|||||
|Total guarantee line approved in|||||||||
|||75,000||amount in the Reporting||100|||
|the Reporting Period (A1+B1+C1)|||||||||
|||||Period (A2+B2+C2)|||||
|||||Total actual guarantee|||||
|Total approved guarantee line at|||||||||
|||||balance at the end of the|||||
|the end of the Reporting Period||75,000||||100|||
|||||Reporting Period|||||
|(A3+B3+C3)|||||||||
|||||(A4+B4+C4)|||||
|Total actual guarantee amount (A4+B4+C4) as % of the|||||||||
|||||0.03%|||||
|Company‘s net assets|||||||||
|Of which:|||||||||
|Balance of debt guarantees provided directly or indirectly for|||||||||
|||||100|||||
|obligors with an over 70% debt/asset ratio (E)|||||||||
|Total of the three amounts above (D+E+F)||||100|||||

 Compound guarantees:
(2) Irregularities in Provision of Guarantees
□ Applicable√ Not applicable
No such cases in the Reporting Period.
3. Cash Entrusted to Other Entities for Management
(1) Cash Entrusted for Wealth Management
□ Applicable√ Not applicable
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 No such cases in the Reporting Period.
(2) Entrusted Loans
□ Applicable√ Not applicable
No such cases in the Reporting Period.
4. Other Major Contracts
□ Applicable√ Not applicable
No such cases in the Reporting Period.
XVIII Corporate Social Responsibility (CSR)
Since its inception, SZPRD has been adhering to the concept of honesty, responsibility and win-win cooperation for the benefit of society. The Company actively fulfills its social responsibilities and always takes repaying the society as an important development concept. It actively fulfills its statutory social responsibilities and ethical social obligations, and unifies the realization of economic and social benefits to create an excellent corporate image. The Company carried out the following activities to perform its social responsibility in 2018:
I. Actively Carry out the Volunteer Service Activities
At the end of August, the Group actively responded to the call of Shenzhen Investment Holding Co., Ltd. to undertake the theme activity for public benefits of―Love& Support forPeople‘s Livelihood1+1‖. For this activity, it was responsible for the organization and publicity of the event, and for advocating the spirit of volunteer service of―dedication, friendship, mutual assistance andprogress‖, helping the poor and tackling the difficulties and supporting the Shenzhen blood bank. During the activity, the Group successfully finished corresponding organization and publicity work. Meanwhile, 37 enterprises directly under the control of Shenzhen Investment Holding Co., Ltd. actively responded, and 415 people participated in the blood donation activity. The accumulated blood donation volume was 135,450 ml, and the whole system donated 17,239 pieces of clothing to various poverty-stricken areas in Kashgar, Xinjiang, strongly demonstrating that various state-owned enterprises in Shenzhen could earnestly fulfill their social responsibilities.
II. Actively Organize and Conduct the Voluntary Blood Donation Activity
In order to commemorate the 97th anniversary of the founding of the Communist Party of China, cherish the history of the party, and carry forward the fine traditions of the party, on 27 June 2018, the party committee of Shenzhen International Trade Center Property Management Co., Ltd. subordinated to SZPRD together with the Jiabei Community Station of Nanhu Sub-district in Luohu District held the activity of―Red Banner& RedAction‖ Voluntary Blood Donation, attracting a total of 96 people to voluntarily donate their blood on the day with the total amount of blood donation 34,750 ml. In fact, the number of people involving the blood donation and the donated blood volume all exceeded that in previous years. Since 2011, the party committee of Shenzhen International Trade Center Property Management Co., Ltd. has insisted on carrying out the theme activity for public benefits of―Red Banner& RedAction‖ to commemorate theparty‘s birthday every year, allowing party member volunteers to play an exemplary role. Fortunately, the activity has attracted the active response from the owners and tenants of ITC Building, various party organizations in the southern business district and Jiabei Community station and people from all walks of life, and become a unique party building activity featuring―the secretary controls the activity, the party branch creates the brand, and the party members strive for becoming thevanguard‖. In terms of this activity, more than 550 people have donated their blood voluntarily with the total unpaid blood donation volume exceeding 180,000 ml.
To celebrate the 40th anniversary ofChina‘s reform and opening up, Huangcheng Property Management Co., Ltd. under the control of
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 SZPRD jointly sponsored the large-scale voluntary blood donation activity―Donate forLife‖ in the Huangyuyuan Residence Community with Shenzhen Blood Center, Red Cross Society of China Shenzhen Branch, Shenzhen Port Community Party Committee, Shenzhen TV Entertainment Life Channel, and Shenzhen Xuezhiyuan Commonweal Foundation from August 24 to August 25. In two days, the number of good-hearted people participating in the blood donation reached 129, the actual number reached 114, and the total amount of blood donation reached 42,900 ml.
III. Care for Employees and Advocate Good Morals
Examples for Care for Employees: In the afternoon of February 8, Liu Shengxiang, the secretary of the party committee& Chairman of SZPRD, Wei Xiaodong, the deputy secretary of the party committee and the secretary of the Discipline Inspection Commission, Liu Guangxin, the chairman of the labor union, and the deputy general manager CaiLili and Zhang Gejian visited and comforted 5 employees suffering from diseases or needing take care of sick family members that were working for three affiliated companies under theCompany‘s direct control, and costed RMB 11,190 by sending them consolation money, gifts and best wishes for the new year. In the afternoon of March 6, the Female Working Committee of SZPRD invited the lecturer of theWorkers‘ Cultural Lecture Hall of Municipal Federation of Trade Unions, the member of IHNMA in Shenzhen, the director of Shenzhen Health Care Association, the TCM health teacher, and the international hypnosis teacher Chen Weiling to hold the public lecture on―Life Cultivation and Health Preservation in FourSeasons‖ as a special gift for female employees on March 8. As a matter of fact, more than 60 female employees from the headquarters and subordinated grassroots trade unions attended the lecture.
The Deeds of Returning Lost Money. In the afternoon of May 16, He Rui, any employee of Shenzhen Huangcheng Property Management Co., Ltd. under the control of SZPRD, picked up HKD25,000 in cash on his way to theemployee‘s canteen. In order to find the owner, he waited in situ for about 10 minutes, but no one came to claim the money. Then, He Rui immediately reported such situation to the Company, and sent the money to Fuqiang Police Station. After he came back to the Company, he finally knew theowner‘s identity by means of checking videos and various investigations, and then found the owner and claimed back the money from Fuqiang Police Station.
IV. Social Honors Obtained
1. On March 21, the list of 2018China‘s Top 500 Real Estate Development Enterprises jointly appraised and elected by CREA, E-house ChinaR&D Institute, China Real Estate Appraisal Center was announced and revealed to the public, and SZPRD ranked among them. Actually,it‘s the 8th time for SZPRD to rank among them.
2. On June 1, China Index Research Academy and China Real Estate TOP10 Research Group held―2018 China Property Service Top 100 Research Results ReleaseConference‖, announcing the list of―Top 100 Property Service Enterprises inChina‖. By virtue of its outstanding comprehensive strength and service management level, Shenzhen International Trade Center Property Management Co., Ltd. under the control of SZPRD ranked 35th among―2018 China Property Service Top 100Enterprises‖, and won various titles such as―China Property Service Top 100 Enterprises (from 2016 to2018)‖ and―2018 China Industrial Park Property Management LeadingEnterprise‖ etc.
3. Guangdong Provincial Enterprises Confederation, Guangdong Provincial Association of Entrepreneurs jointly held―2018 Guangdong Enterprises Top 500& Excellent Independent Brands Release Conference", announcing the list of Top 500 Enterprises in Guangdong Province. By virtue of its remarkable performance in operating the real estate development and property management business, SZPRD was awarded the title of―Top 500 Enterprises in Guangdong Province in2018‖. In fact, the Group won the title of―Top 500 Enterprises in Guangdong Province in2017‖for the 8th time.
4. On December 14, Shenzhen Printing Industry Association held―2018 Internal Publication Media Awards Presentation Ceremony of Shenzhen Enterprise InternalPublications‖, announcing the winners of Shenzhen Excellent Internal Publication Media Awards. The internal publication of ITC Window of SZPRD won―2018 Shenzhen Excellent Internal Publication MediaAward‖. Since 2009, ITC Window has won this award for ten consecutive years.
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 2. Measures Taken for Targeted Poverty Alleviation
The Companydidn‘t take any targeted measures to help people lift themselves out of poverty during the Reporting Period, no targeted poverty alleviation plan temporarily too.
3. Issues Related to Environmental Protection
Indicate by tick mark whether the Company or any of its subsidiaries is identified as a major polluter by the environmental protection authorities.
No.
No such cases in the Reporting Period.
XIX Other Significant Events
□ Applicable√ Not applicable
No such cases in the Reporting Period.
XX Significant Events of Subsidiaries
□ Applicable√ Not applicable
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Part VI Share Changes and Shareholder Information
I. Share Changes
1. Share Changes
Unit: share
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
||Before||Increase/decrease in the Reporting Period (+/-)|||||After||
||||||Shares as|||||
|||||Shares as||||||
||||||dividend|||||
|||Percent||dividend||||||
||||New||converted||Subtota||Percent|
||Shares|age||converted||Other||Shares||
||||issues||from||l||age (%)|
|||(%)||from||||||
||||||capital|||||
|||||profit||||||
||||||reserves|||||
|I. Restricted shares|352,511,223|59.15%|0|0|0|0||352,511,223|59.15%|
|1. Shares held by State|||0|0|0|0||||
|2. Shares held by state-owned||||||||||
||350,579,943|58.82%|0|0|0|0||350,579,943|58.82%|
|legal person||||||||||
|3. Shares held by other||||||||||
||1,931,280|0.33%||||||1,931,280|0.33%|
|domestic investors||||||||||
|Among which: Shares held||||||||||
||1,894,980|0.32%||||||1,894,980|0.32%|
|by domestic legal person||||||||||
|Shares held by||||||||||
||36,300|0.01%||||||36,300|0.01%|
|domestic natural person||||||||||
|4. Shares held by other||||||||||
||0|||||||||
|foreign investors||||||||||
|II. Unrestricted shares|243,467,869|40.85%|0|0|0|0||243,467,869|40.85%|
|1. RMB common shares|175,862,626|29.51%|0|0|0|0||175,862,626|29.51%|
|2. Domestically listed foreign||||||||||
||67,605,243|11.34%|0|0|0|0||67,605,243|11.34%|
|shares||||||||||
|||100.00|||||||100.00|
|III. Total shares|595,979,092|||||||595,979,092||
|||%|||||||%|

 Reasons for share changes:
□ Applicable√ Not applicable
Approval of share changes:
□ Applicable√ Not applicable
Transfer of share ownership:
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018□ Applicable√ Not applicable
Progress on any share repurchases:
□ Applicable√ Not applicable
Progress on reducing the repurchased shares by means of centralized bidding:
□ Applicable√ Not applicable
Effects of share changes on the basic and diluted earnings per share, equity per share attributable to theCompany‘s ordinary shareholders and other financial indicators of the prior year and the prior accounting period, respectively:
□ Applicable√ Not applicable
Other information that the Company considers necessary or is required by the securities regulator to be disclosed:
□ Applicable√ Not applicable
2. Changes in Restricted Shares
□ Applicable√ Not applicable
II. Issuance and Listing of Securities
1. Securities (Exclusive of Preferred Shares) Issued in the Reporting Period
□ Applicable√ Not applicable
2. Changes to Total Shares, Shareholder Structure and Asset and Liability Structures
□ Applicable√ Not applicable
3. Existing Staff-Held Shares
□ Applicable√ Not applicable
III Shareholders and Actual Controller
1. Shareholders and Their Shareholdings at the Period-End
Unit: share
|||||||||
|-|-|-|-|-|-|-|-|
|Number of||Number of||Number of||Number of||
|ordinary|45,465|ordinary|45,610|preferred|0|preferred|0|
|shareholders||shareholders at||shareholders with||shareholders||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
|||the month-end||||resumed voting||||with resumed||
|||prior to the||||rights (if any) (see||||voting rights at||
|||disclosure of this||||note 8)||||the month-end||
|||Report||||||||prior to the||
|||||||||||disclosure of this||
|||||||||||Report (if any)||
|||||||||||(see note 8)||
|5% or greater shareholders or top 10 shareholders||||||||||||
|||||Total|||||Shares in pledge or frozen|||
||||||Increase/|||||||
||||Sharehold|shares||||||||
||||||decrease||Restricted|Unrestrict||||
|Name of|Nature of||ing|held at||||||||
||||||in the||shares|ed shares||||
|shareholder|shareholder||percentag|the|||||Status||Shares|
||||||Reporting||held|held||||
||||e|period-en||||||||
||||||Period|||||||
|||||d||||||||
|ShenzhenInvestmentHoldingsCorporation|State-owned legalperson||63.82%|380,378,897|380,378,897.00||350,579,943|29,798,954||||
|ShenzhenDuty-FreeCommodityEnterprises Co.,Ltd.|Domesticnon-state-ownedlegal person||0.29%|1,730,300|0||1,730,300|0||||
|Yang Yaochu|Domestic naturalperson||0.24%|1,410,620|0||0|1,410,620||||
|Li Jing|Domestic naturalperson||0.20%|1,176,740|214,300||0|1,176,740||||
|Su Zhifen|Domestic naturalperson||0.19%|1,150,000|1,150,000||0|1,150,000||||
|Mai Furong|Domestic naturalperson||0.19%|1,130,500|0||0|1,130,500||||
|WuhanXingkaiyuanElectric PowerEngineering Co.,Ltd|Domesticnon-state-ownedlegal person||0.17%|1,000,000|1,000,000||0|1,000,000||||
|Chen Liying|Domestic naturalperson||0.14%|846,621|-255,430||0|846,621||||
|Cao Yifan|Domestic naturalperson||0.14%|820,460|60,460||0|820,460||||
|Zhang Shaoming|Domestic natural||0.13%|785,000|785,000||0|785,000||||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||||
|-|-|-|-|-|
||person||||
|Strategic investor or general legal|||||
|person becoming a top-10 ordinary|||||
|||N/A|||
|shareholder due to rights issue (if any)|||||
|(see note 3)|||||
|||The first largest shareholder, Shenzhen Investment Holding Corporation, is the actual|||
|Related or acting-in-concert parties|||||
|||controlling shareholder of the Company. And the Company does not know whether there|||
|among the shareholders above|||||
|||are related parties or acting-in-concert parties among the other 9 shareholders.|||
|Top 10 unrestricted shareholders|||||
||||Shares by type||
|Name of shareholder||Unrestricted shares held at the period-end|||
||||Type|Shares|
|Shenzhen Investment HoldingsCorporation||29,798,954|RMB common||
|||||29,798,954|
||||share||
|Yang Yaochu||1,410,620|Domestically||
||||listed foreign|1,410,620|
||||share||
|Li Jing||1,176,740|Domestically||
||||listed foreign|1,176,740|
||||share||
|Su Zhifen||1,150,000|RMB common||
|||||1,150,000|
||||share||
|Mai Furong||1,130,500|Domestically||
||||listed foreign|1,130,500|
||||share||
|Wuhan Xingkaiyuan Electric PowerEngineering Co., Ltd||1,000,000|RMB common||
|||||1,000,000|
||||share||
|Chen Liying||846,621|Domestically||
||||listed foreign|846,621|
||||share||
|Cao Yifan||820,460|Domestically||
||||listed foreign|820,460|
||||share||
|Zhang Shaoming||785,000|RMB common||
|||||785,000|
||||share||
|He Simo||762,650|Domestically||
||||listed foreign|762,650|
||||share||
|Related or acting-in-concert parties|||||
|||The first largest shareholder, Shenzhen Investment Holding Corporation, is the actual|||
|among top 10 unrestricted public|||||
|||controlling shareholder of the Company. And the Company does not know whether there|||
|shareholders, as well as between top|||||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||
|-|-|
|10 unrestricted public shareholders|are related parties or acting-in-concert parties among the other 9 shareholders.|
|and top 10 shareholders||
|Top 10 ordinary shareholders involved||
|in securities margin trading (if any)|N/A|
|(see note 4)||

Indicate by tick mark whether any of the top 10 ordinary shareholders or the top 10 unrestricted ordinary shareholders of the Company conducted any promissory repo during the Reporting Period.
□ Yea√ No
No such cases in the Reporting Period.
2. Controlling Shareholder
Nature of the controlling shareholder: Controlled by a local state-owned legal person
Type of the controlling shareholder: legal person
||||||
|-|-|-|-|-|
||Legal||||
|Name of controlling|||Unified social credit||
||representative/person|Date of establishment||Principal activity|
|shareholder|||code||
||in charge||||
|||||To execute the investment,|
|||||operating and management|
|||||of the state-owned equities|
|||||of the wholly-owned,|
|||||controlling and|
|||||stock-participating|
|||||enterprises through the|
|||||methods such as the|
|||||restructuring integration,|
|||||capital operation and assets|
|||||disposal; to engage in the|
|Shenzhen Investment||||property development and|
||Wang Yongjian|13 October 2004|914403007675664218||
|Holdings Corporation||||operation business within|
|||||the scale of legally acquire|
|||||the land use right; to|
|||||execute the policy-based|
|||||and strategic investment|
|||||according to the|
|||||requirements of the|
|||||SASAC; to provide the|
|||||guarantee of the municipal|
|||||state-owned enterprises;|
|||||other business developed|
|||||with the authority from the|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||
|-|-|-|
|||Municipal State-owned|
|||Assets Supervision and|
|||Administration|
|||Commission.|
||SZPRD A (000011) holds 380.38 million shares, accounting for 63.82%; Shenzhen Textile (000045)||
||holds 234.06 million shares, accounting for 46.21%; Shenzhen Shenbao A (000019) holds 72.25||
|Shareholdings of the|million shares, accounting for 16.00%; SPG A (000029) holds 642.88 million shares, accounting||
|controlling shareholder in|for 63.55%; Shenzhen Universe A (000023) holds 14.44 million shares, accounting for 10.41%;||
|other listed companies at|Ping‘an (601318) holds 962.72 million shares, accounting for 5.27%; Guosen Securities (002736)||
|home or abroad in this|holds 2,749.52million shares, accounting for 33.53%; Guotai Jun‘an (601211) holds 624.07||
|Reporting Period|million shares, accounting for 8.18%; Telling Telecommunication (000829) holds 131,917,569||
||shares, accounting for 13.76%; Emap Information (834386) holds 42.00 million shares, accounting||
||for 60.00%; CCIC-Testing (836325) holds 20.00million shares, accounting for 40.00%.||

Change of the controlling shareholder in the Reporting Period:
□ Applicable√ Not applicable
No such cases in the Reporting Period.
3. Actual Controller and Its Acting-in-Concert Parties
Nature of the actual controller: local institution for state-owned assets management
Type of the actual controller: legal person
||||||
|-|-|-|-|-|
||Legal||||
|||Date of|Unified social credit||
|Name of actual controller|representative/per|||Principal activity|
|||establishment|code||
||son in charge||||
|||||(I) Implementing and practicing|
|||||state, provincial and municipal|
|||||laws and regulations related to|
|||||management on state-owned|
|||||assets, drafting local laws,|
|||||regulations, and policies about|
|||||management on state-owned|
|||||assets, and organizing|
|Shenzhen Municipal|||||
|||||implementation activities upon|
|State-owned Assets Supervision|Peng Haibin||N/A||
|||||approvals. Intending to draft|
|and Administration Commission|||||
|||||supervision systems and|
|||||methods about operational|
|||||state-owned assets, and|
|||||organizing implementation|
|||||activities.|
|||||(II) On the basis of authorization|
|||||from municipal government,|
|||||fulfilling duties of investors|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||
|-|
|according to laws and|
|regulations, and protecting the|
|rights and interests of investors|
|for state-owned assets according|
|to laws|
|(III) Taking charge of|
|Party-building work for|
|enterprises in its supervision and|
|organs entrusted|
|(IV) Undertaking the|
|supervision over state-owned|
|assets of municipal enterprises,|
|strengthening management on|
|state-owned assets, further|
|perfecting the management|
|mechanism for state-owned|
|assets with the unification of|
|power, obligation, and duties, as|
|well as the combination of|
|managing assets, people, and|
|affairs|
|(V) Being responsible for|
|hedging and appreciation of the|
|value of state-owned assets of|
|enterprises in its supervision,|
|establishing and perfecting the|
|index system for hedging and|
|appreciation of the value of|
|state-owned assets, setting out|
|assessment standards,|
|supervising on hedging and|
|appreciation of the value of|
|state-owned assets of enterprises|
|in its supervision by statistics,|
|audit, and check, and urging|
|enterprises in its supervision to|
|fulfill social duties|
|(VI) In charge of researching|
|and preparing the general|
|planning for transformation and|
|development of state-owned|
|enterprise in its supervision,|
|guiding and boosting|
|transformation and|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||
|-|
|re-organization of state-owned|
|enterprises, prompting the|
|construction of modern|
|enterprise system, carrying|
|forward operation of|
|state-owned capital, pushing the|
|strategic adjustment on|
|state-owned economy layout and|
|structure, and making|
|state-owned capital play the role|
|in significant industries and key|
|fields including national|
|security, national economy|
|lifeline, etc.|
|(VII) Directing and propelling|
|enterprises in its supervision to|
|perfect company governance|
|structure, intensifying|
|construction of Board and|
|Supervision Committees of|
|enterprises in its supervision,|
|and forming the governance|
|mechanism with specific duties,|
|coordinating operation, and|
|effective counterbalance|
|(VIII) Assuming the|
|management work of income|
|distribution for enterprises in its|
|supervision, and standardizing|
|the income distribution and|
|position-related consumption|
|over people in charge of|
|enterprises in its supervision|
|(IX) In line with rules of|
|municipal Party committee,|
|appointing and dismissing,|
|appraising, as well as, in|
|accordance with business|
|performance, rewarding and|
|punishing people in charge of|
|enterprises in its supervision by|
|applying legal procedures,|
|establishing the mechanism of|
|selecting and choosing|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||
|-|-|-|
|||candidates meeting the|
|||requirements of socialist market|
|||economy system and modern|
|||enterprise system, and perfecting|
|||the incentive and control system|
|||for operators|
|||(X) Being responsible for|
|||appointing or recommending|
|||board directors, supervisors,|
|||CFOs to enterprises in its|
|||supervision, and auditing on|
|||economic duties of people in|
|||charge of enterprises in its|
|||supervision according to rules|
|||about management authorization|
|||to people in charge of|
|||enterprises|
|||(XI) In charge of preparing the|
|||draft of budgets and final|
|||accounts of annual state-owned|
|||capital of enterprises in its|
|||supervision, including it to the|
|||government budget system,|
|||organizing the execution upon|
|||approvals, and collecting|
|||earnings of state-owned capital|
|||handed in by enterprises in its|
|||supervision|
|||(XII) In charge of strategy|
|||research, policy formulation,|
|||and guidance for transformation,|
|||development, and asset|
|||management related to|
|||collectively-owned enterprises|
|||(XIII) Assuming other|
|||assignments assigned by|
|||municipal government and|
|||superior departments|
|Shareholdings of the actual|||
|controller in other listed|Listed companies such as the Shenzhen Airport, YTP, Shenzhen Energy, Shenzhen Zhenye,||
|companies at home or abroad in|Shenzhen Tagen, Agricultural Products and SDGI.||
|this Reporting Period|||

Change of the actual controller during the Reporting Period:
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018□ Applicable√ Not applicable
No such cases in the Reporting Period.
Ownership and control relations between the actual controller and the Company:
Indicate by tick mark whether the actual controller controls the Company via trust or other ways of asset management.
□ Applicable√ Not applicable
4. Other10% or Greater Corporate Shareholders
□ Applicable√ Not applicable
5. Limitations on Shareholding Decrease by theCompany’s Controlling Shareholder, Actual Controller, Reorganizer and Other Commitment Makers
□ Applicable√ Not applicable
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Part VII Preferred Shares
□ Applicable√ Not applicable
No preferred shares in the Reporting Period.
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Part VIII Directors, Supervisors, Senior Management and Staff I Change in Shareholdings of Directors, Supervisors and Senior Management
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
||||||||Beginnin|Increase|Decrease|||
|||||||||||Other|Ending|
||||||||g|in the|in the|||
||Office|Incumben||||||||increase/d|sharehold|
|Name|||Gender|Age|Start of|End of|sharehold|Reporting|Reporting|||
||title|t/Former|||tenure|tenure||||ecrease|ing|
||||||||ing|Period|Period|||
|||||||||||(share)|(share)|
||||||||(share)|(share)|(share)|||
|Liu|Chairman|||||||||||
|||Incumben|||15 June|14 June||||||
|Shengxia|of the||Male|48|||0|0|0|0|0|
|||t|||2018|2021||||||
|ng|Board|||||||||||
|Wang|Director,|Incumben|||15 June|14 June||||||
||||Male|53|||0|0|0|0|0|
|Hangjun|GM|t|||2018|2021||||||
|Wei||Incumben|||15 June|14 June||||||
||Director||Male|49|||0|0|0|0|0|
|Xiaodong||t|||2018|2021||||||
|Shen|Director|Incumben|||15 June|14 June||||||
||||Female|50|||0|0|0|0|0|
|Xueying|and CFO|t|||2018|2021||||||
|||Incumben|||15 June|14 June||||||
|Wang Ge|Director||Male|48|||0|0|0|0|0|
|||t|||2018|2021||||||
|Zhang||Incumben|||15 June|14 June||||||
||Director||Male|41|||0|0|0|0|0|
|Shilei||t|||2018|2021||||||
||Chairman|||||||||||
|Chen|||||30 June|15 June||||||
||of the|Former|Male|62|||0|0|0|0|0|
|Yugang|||||2006|2018||||||
||Board|||||||||||
||Director||||15 July|15 June||||||
|Wei Zhi||Former|Male|62|||0|0|0|0|0|
||and GM||||2008|2018||||||
||Director,|||||||||||
||Chairman||||22|||||||
|Liu||||||15 June||||||
||of the|Former|Male|61|December||0|0|0|0|0|
|Guangxin||||||2018||||||
||Labor||||2007|||||||
||Union|||||||||||
|Guo|Director||||30 June|15 June||||||
|||Former|Male|46|||0|0|0|0|0|
|Liwei|||||2006|2018||||||
||Director||||1|||||||
|||||||15 June||||||
|Wen Li||Former|Female|50|December||0|0|0|0|0|
|||||||2018||||||
||||||2007|||||||
|Yuan|Independ|Incumben|Male|48|14 April|14 June|0|0|0|0|0|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
|Hongchan|ent|t|||2017|2021||||||
|g|Director|||||||||||
||Independ|||||||||||
|Mei||Incumben|||15 June|14 June||||||
||ent||Male|55|||0|0|0|0|0|
|Yonghong||t|||2018|2021||||||
||Director|||||||||||
||Independ|||||||||||
|Li||Incumben|||15 June|14 June||||||
||ent||Male|42|||0|0|0|0|0|
|Qingyuan||t|||2018|2021||||||
||Director|||||||||||
||Independ||||22|||||||
|||||||15 June||||||
|Li Jianxin|ent|Former|Male|65|October||0|0|0|0|0|
|||||||2018||||||
||Director||||2014|||||||
||Independ||||22|||||||
|||||||15 June||||||
|Zhang Qi|ent|Former|Male|41|October||0|0|0|0|0|
|||||||2018||||||
||Director||||2014|||||||
||Chairman|||||||||||
|Dai|of the|Incumben|||15 June|14 June||||||
||||Male|57|||0|0|0|0|0|
|Xianhua|Superviso|t|||2018|2021||||||
||ry Board|||||||||||
|Zhang|Superviso|Incumben|||15 June|14 June||||||
||||Male|44|||0|0|0|0|0|
|Manhua|r|t|||2018|2021||||||
|Li|Superviso|Incumben|||15 June|14 June||||||
||||Male|37|||0|0|0|0|0|
|Qinghua|r|t|||2018|2021||||||
|Wang|Superviso||||3 June|15 June||||||
|||Former|Female|57|||0|0|0|0|0|
|Xiuyan|r||||2011|2018||||||
||Employee|||||||||||
|Wang||Incumben|||15 June|14 June||||||
||superviso||Female|49|||0|0|0|0|0|
|Qiuping||t|||2018|2021||||||
||r|||||||||||
||Employee|||||||||||
|Gu||Incumben|||15 June|14 June||||||
||superviso||Female|38|||0|0|0|0|0|
|Weimin||t|||2018|2021||||||
||r|||||||||||
|Fan||Incumben|||15 June|14 June||||||
||Vice GM||Male|54|||0|0|0|0|0|
|Weiping||t|||2018|2021||||||
|||Incumben|||15 June|14 June||||||
|Cai Lili|Vice GM||Female|47|||0|0|0|0|0|
|||t|||2018|2021||||||
|||Incumben|||15 June|14 June||||||
|Li Peng|Vice GM||Male|43|||0|0|0|0|0|
|||t|||2018|2021||||||
|Zhang||Incumben|||15 June|14 June||||||
||Vice GM||Male|44|||0|0|0|0|0|
|Gejian||t|||2018|2021||||||
|Deng|||||28 April|18 May||||||
||CFO|Former|Male|41|||0|0|0|0|0|
|Shaowu|||||2017|2018||||||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
|Total|--|--|--|--|--|--|0|0|0|0|0|

 II Change of Directors, Supervisors and Senior Management
√Applicable□ Not applicable
||||||
|-|-|-|-|-|
|Name|Office title|Type of change|Date of change|Reason for change|
||Chairman of the||||
|Chen Yugang||Left|15 June 2018|To the age of retirement|
||Board||||
|Wei Zhi|Director and GM|Left|15 June 2018|To the age of retirement|
||Director,|Left|||
|Liu Guangxin|Chairman of the||15 June 2018|To the age of retirement|
||Labor Union||||
|Guo Liwei|Director|Left|15 June 2018|Job transfer|
|Wen Li|Director|Left|15 June 2018|Job transfer|
|Deng Shaowu|CFO|Dismissed|18 May 2018|Job transfer|
||Independent||||
|Zhang Qi||Left|15 June 2018|Jon-related reason|
||Director||||
||Independent|Left when the|||
|Li Jianxin|||15 June 2018|Two consecutive terms expired|
||Director|term expired|||
|Wang Xiuyan|Supervisor|Left|15 June 2018|To the age of retirement|
|||||No longer holding the post of supervisor, but as the vice|
|Zhang Gejian|Supervisor|Appointed|15 June 2018||
|||||GM|

III Biographical Information
Professional backgrounds, major work experience and current duties in the Company of the incumbent directors, supervisors and senior management:
Members of the Board of Directors:
Mr. Liu Shengxiang, born in August 1971, is a now member of the Communist Party of China, professor-level senior engineer, National Certified Architect (Level 1), and has obtained his Bachelor Degree, Master of Engineering, and MBA. In June 1994, he joined Shenzhen Tagen Group Co., Ltd., and successively served as the deputy general manager, general manager, and general Party branch secretary of Shenzhen Municipal Engineering Corp. and the deputy general manager of Shenzhen Tagen Group Co., Ltd. In June 2013, he joined Shenzhen Road& Bridge Group as the executive director, Secretary of the Party Committee and general manager. He now is the Secretary of the Party Committee and the Chairman of the Company. Mr. Liu Shengxiang was awarded the title of Outstanding Communist Party Member of Shenzhen in 2001, and obtained Tien-yow Jeme Civil Engineering Prize in 2013, and May 1st Labor Medal of Shenzhen in 2015, the Party representative of the 6th Party Congress in Shenzhen.
Mr. Wang Hangjun, born in Nov. 1966, member of Communist Party of China, is a senior auditor with a master degree of economy. He ever took post of Deputy Chief of Audit Bureau of Nanshan District, Shenzhen; Vice Minister, Minister of Audit Department of Shenzhen Investment and Management Company; Vice Minister, Minister of Supervision Department of Shenzhen Investment and
Management Company; Minister of Audit and Inspection Department of Shenzhen Investment Holding Co., Ltd. He has been Deputy
GM of the Company since Oct. 2007. Now he is the Director, deputy Party Secretary and GM of the Company.
Mr. Wei Xiaodong, born in January 1970, is a member of the Communist Party of China with theBachelor‘s Degree. Mr. Wei
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Xiaodong ever worked in the municipal government department of Shenzhen for many years. In 2008, he began to work for Shenzhen State-owned Assets Supervision and Administration Commission, and successively served as the deputy director and director of Shenzhen SASAC Office. In June 2014, he served as the deputy director of Shenzhen SASAC Office, and now, he is the Director, deputy secretary of the Party committee, Secretary of Committee for Discipline Inspection.
Ms. Shen Xueying, born in October 1969, Bachelor of Economics, is a senior accountant. Ms. Shen Xueying has been engaged in the financial management of listed companies for more than 20 years. She joined the Finance Department of the Company in 1991 and successively served as the clerk and deputy manager of the financial management department of the Company. She was the manager of the financial management department of the Company from 2007-2018 and now she is currently the Director and Chief Financial Officer of the Company.
Mr. Wang Ge, born in October 1971, the member of the Communist Party of China, is now the senior engineer with the degree of Bachelor of Engineering. Mr. Wang Ge has been engaged in the enterprise management for many years. He successively served as the deputy director and director of the engineering department of ShenzhenJian‘an (Group) Co., Ltd., the manager and the deputy secretary of the Party Branch ofJian‘an Group Construction and Municipal Engineering Company, and the deputy general manager, director, the deputy secretary of the Party Committee and the general manager ofJian‘an Group. From March 2017 to present, he has served as the Chief Engineer of Shenzhen Investment Holdings Co., Ltd.
Mr. Zhang Shilei, Born in December 1976, is the member of the Communist Party of China with the degree of Master of Management, and successively served as the office director of Shenzhen Information Pipeline Co., Ltd., the deputy director of the general office of Shenzhen Investment Holdings Co., Ltd., the director of Shenzhen Wuzhou Hotel Co., Ltd., the deputy secretary of the Party Committee and the secretary of the Committee for Discipline Inspection. From September 2017 to present, he serves as the director of the general management department of Shenzhen Investment Holdings Co., Ltd.
Mr. Yuan Hongchang, born in Mar. 1971, Chinese nationality without overseas residency, is a undergraduate and postgraduate of Tsinghua University, EMBA of Central Europe. He holds professional qualification of registered land appraiser of China and registered real estate broker. He joined in Shenzhen WorldUnion Properties Consultancy Incorporated in 2001, and acted as Vice GM in East China Region, GM of Shanghai WorldUnion, GM in East China Region. Now he works as Vice GM and Secretary of Board in Shenzhen WorldUnion Properties Consultancy Incorporated. Mr. Yuan Hongchang has attended the 80th phase of independentdirectors‘ training class of Shenzhen Stock Exchange with qualification certificate of independent director.
Mr. Mei Yonghong, born in October 1964, is the member of the Communist Party of China, and graduated from the Department of Agriculture of Huazhong Agricultural University with the Degree of Bachelor of Agriculture. He successively served as the deputy director of the General Office of Ministry of Science and Technology and the director of the information research office, the director of the Policy, Regulations and System Reform Department of Ministry of Science and Technology and the mayor of Jining City in Shandong Province. From September 2015 to present, he has served as the director of China National GeneBank (CNGB) and the chairman of BGI Agricultural Group.
Mr. Li Qingyuan, Born in 1977, is the member of the Communist Party of China with the Chinese nationality. After he obtained the degree of the Doctor of Accountancy, he became a visiting scholar of Columbia University, and was successively supported by Program for New Century Excellent Talents in University of Ministry of Education in 2012, 351 Program for Talents of Wuhan University in 2011 and Outstanding Accounting Talents (Academic) of Ministry of Finance in 2008. Meanwhile, he also serves as the member of the Academic Exchange Committee of Accounting Society of China, the editor member of China Journal of Accounting Studies, the professional editor-in-chief of Luojia Management Review and the director of the Board of Journal of Management Accounting Studies. As a professor (Level 4), he is nominated and elected into National Support Program for Outstanding Young Talents, and now serves as the deputy dean of the department of economy and management and the director of the department of accounting of Wuhan University.
Members of the Supervisory Committee:
Mr. Dai Xianhua, was born in April 1962, doctor degree, Party member of CPC. He worked as a lecturer in School of Business and Economy of Zhongnan University of Economics and Law from 1986 to 1989. He took posts of editor of department of theory and
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 review, vice director, and editor-in-chief, in Shenzhen Economic Daily from 1992 to 1997; worked in Shenzhen State Assets Administration Committee (hereinafter referred as―ShenzhenSAC‖) as Vice Section Chief of Assets Management Department, investigator of property right management Department, Vice Director, investigator of Office, and investigator of Appraisal and Distribution Department from 1997 to 2012. Since 2012 he is the Chairman of the Supervisory Committee of the Company. Mr. Zhang Manhua, born in Feb. 1975,master‘s degree, member of the Communist Party of China, studied and worked in Central South University from 1992 to 2004; Senior Manager in the Investment Center of Konka Group and concurrently worked as the Board Secretary for Shenzhen Jvlong Optoelectronic Co., Ltd., and Investment Manager in Shenchao Technological Investment Co., Ltd. from 2004 to 2013; he worked as deputy director in the Strategy& Development Department in Shenzhen Investment Holding Co., Ltd from 2013 to 2018. He is the director in Law and Risks Management department of Shenzhen Investment Holdings Co., Ltd since 2018.
Mr. Li Qinghua, born in April 1982, has obtained his Bachelor degree. From 2003 to 2013, he worked for DZX International Appraisal Limited, and successively served as the project assistance, the project manager and the senior manager; from 2013 to 2017, he served as the senior executive of the property right management and legal affairs department of Shenzhen Investment Holdings Co., Ltd., and from 2017 till now, he serves as the deputy director of the audit department of Shenzhen Investment Holdings Co., Ltd. Ms. Wang Qiuping, born in Jan. 1970, Bachelor degree, member of the Communist Party of China, is a senior economist. From 1992 to 2015, she ever took post in GM office, Plan and Finance Department, and Development Management. Since 2015, she is the Party Committee Secretary and GM of Shenzhen International Trade Center Property Management Co., Ltd.
Ms. Gu Weimin, Born in October 1981, is the member of the Communist Party of China with theMaster‘s Degree. From 2007 to 2010, he served as the audit assistance manager of KPMG Shenzhen; from 2011 till now, he has worked for the Company in the audit department (the office of the board of supervisors), and is now the deputy director of the audit department.
Executive officers:
Mr. Wang Hangjun, born in Nov. 1966, member of Communist Party of China, is a senior auditor with a master degree of economy. He ever took post of Deputy Chief of Audit Bureau of Nanshan District, Shenzhen; Vice Minister, Minister of Audit Department of Shenzhen Investment and Management Company; Vice Minister, Minister of Supervision Department of Shenzhen Investment and Management Company; Minister of Audit and Inspection Department of Shenzhen Investment Holding Co., Ltd. He has been Deputy GM of the Company since Oct. 2007. Now he is the Director, deputy Party Secretary and GM of the Company.
Mr. Fan Weiping, born in Apr. 1965, is a member of the Communist Party of China with postgraduate degree. He used to work in Shenhua Group successively as the Chief of the Legal Affairs Section in the Supervisory and Audit Department; the Vice Manager and Manager of the Legal Affairs Department; the GM Assistant; and the Chief Legal Adviser. Since Jan. 2009, he has become the Board Secretary and the Chief Legal Adviser for the Company. And he has been a Vice GM, the Board Secretary and the Chief Legal Adviser for the Company since Feb. 2012, and he got the qualification certificate of Board Secretary in Shenzhen Stock Exchange in 2009. Now he is the member of the Party Committee, vice GM, Chief Legal Adviser, and Board Secretary of the Company. Ms. Cai Lili, Born in November 1972, is the member of the Communist Party of China, and has obtained theMaster‘s Degree in Economics. Since 1995, he has worked in Shenzhen Tax Service, SAT, and ever served as the deputy chief of the taxation and scientific and technological development department of Shenzhen Tax Service, SAT, and the member of the Party Organization and the deputy director of Futian District Tax Bureau in Shenzhen. Currently, he is the member of the Party Committee, deputy general manager and Chief Financial Officer.
Mr. Li Peng, Born in May 1976, is the member of the Communist Party of China, the Bachelor of Engineering and the intermediate economist. Since July 1999, he has worked for the Company as the operation manager, and successively served as the deputy manager of theCompany‘s development management department, the manager of the cost control department, and the secretary of the Party branch and the deputy general manager of Shenzhen Huangcheng Real Estate Co., Ltd. Currently, he now is the member of the Party Committee, and deputy general manager.
Mr. Zhang Gejian, born in September 1975, the member of the Communist Party of China, MBA, is an Accountant as well as Auditor. He was engaged in internal auditing work in Audit Department of the Company since July 1997. He acted as the audit
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 manager, Supervisor of the Company and concurrently the Cost Control Manager. Now he is the member of the Party Committee, and the vice GM of the Company.
Ms. Shen Xueying, born in October 1969, the member of the Communist Party of China, Bachelor of Economics, is a senior accountant. Ms. Shen Xueying has been engaged in the financial management of listed companies for more than 20 years. She joined the Finance Department of the Company in 1991 and successively served as the clerk and deputy manager of the financial management department of the Company. She has been the manager of the financial management department of the Company from 2007-2018, and now she is the Director, and Chief Financial Officer of the Company.
Offices held concurrently in shareholding entities:
√Applicable□Not applicable
|||||||
|-|-|-|-|-|-|
|||Office held in||||
||||||Remuneration or|
|Name|Shareholding entity|the|Start of tenure|End of tenure|allowance from the|
|||shareholding||||
|||entity|||shareholding entity|
|||Chief||||
|||Engineer of||||
|||Shenzhen||||
|Wang Ge|Shenzhen Investment Holdings Co., Ltd.||1 March 2017||Yes|
|||Investment||||
|||Holdings Co.,||||
|||Ltd.||||
|||Director of||||
|||the general||||
|||management||||
|||department of|1 September|||
|Zhang Shilei|Shenzhen Investment Holdings Co., Ltd.||||Yes|
|||Shenzhen|2017|||
|||Investment||||
|||Holdings Co.,||||
|||Ltd.||||
|||Deputy||||
|||director in||||
|||capital||||
|||operation||||
|Zhang Manhua|Shenzhen Investment Holdings Co., Ltd.|department of|1 January 2017||Yes|
|||Shenzhen||||
|||Investment||||
|||Holdings Co.,||||
|||Ltd||||
|||Deputy||||
|||director of the||||
|||audit||||
|||department of||||
|Li Qinghua|Shenzhen Investment Holdings Co., Ltd.||1 January 2017||Yes|
|||Shenzhen||||
|||Investment||||
|||Holdings Co.,||||
|||Ltd.||||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Offices held concurrently in other entities:
√Applicable□Not applicable
|||||||
|-|-|-|-|-|-|
||||||Remuneration or|
|Name|Other entity|Office held in|Start of tenure|End of tenure|allowance from|
|||the entity||||
||||||the entity|
|||Vice GM and||||
|||Secretary of||||
|||Board in||||
|Yuan|Shenzhen WorldUnion Properties|Shenzhen|1 September|||
||||||Yes|
|Hongchang|Consultancy Incorporated|WorldUnion|2013|||
|||Properties||||
|||Consultancy||||
|||Incorporated.||||
|||Director of||||
|||China||||
|||National||||
|||GeneBank||||
||China National GeneBank, BGI Agricultural||1 September|||
|Mei Yonghong||(CNGB) and|||Yes|
||Group||2015|||
|||the chairman||||
|||of BGI||||
|||Agricultural||||
|||Group||||
|||Deputy dean||||
|||of the||||
|||department of||||
|||economy and||||
|||management||||
||||1 December|||
|Li Qingyuan|Wuhan University|and the|||Yes|
||||2015|||
|||director of the||||
|||department of||||
|||accounting of||||
|||Wuhan||||
|||University.||||

Punishments imposed in the recent three years by the securities regulator on the incumbent directors, supervisors and senior management as well as those who left in the Reporting Period:
□ Applicable√ Not applicable
IV Remuneration of Directors, Supervisors and Senior Management
Decision-making procedure, determination basis and actual payments of remuneration for directors, supervisors and senior
management:
During this Reporting Period, the board and the management of the Company signed statement of operation objectives responsibility
for 2018, conducted appraisal system integrating operation indicators, classification indicators with management objectives. After the
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 end of this Reporting Period, assessment was implemented by the board. Remuneration of senior executives, according to―Management Method of Annual salary System of Directors, Supervisors and SeniorExecutives‖, adopted annual salary system, and need to be implemented after assessment of the board.
Remuneration of directors, supervisors and senior management for the Reporting Period
Unit: RMB'0,000
||||||||
|-|-|-|-|-|-|-|
||||||Total before-tax||
|||||||Any|
|||||Incumbent/Forme|remuneration||
|Name|Office title|Gender|Age|||remuneration|
|||||r|from the||
|||||||from related party|
||||||Company||
||Chairman of the||||||
|Liu Shengxiang||Male|48|Incumbent|77.36|No|
||Board||||||
|Wang Hangjun|Director, GM|Male|53|Incumbent|123|No|
||Director,||||||
|Liu Guangxin|Chairman of the|Male|61|Former|79.81|No|
||Labor Union||||||
|Guo Liwei|Director|Male|46|Former||Yes|
|Wen Li|Director|Female|50|Former||Yes|
|Wang Ge|Director|Male|48|Incumbent||Yes|
|Zhang Shilei|Director|Male|41|Incumbent||Yes|
||Independent||||||
|Li Jianxin||Male|65|Former|3.67|No|
||Director||||||
||Independent||||||
|Zhang Qi||Male|41|Former|3.67|No|
||Director||||||
||Independent||||||
|Yuan Hongchang||Male|48|Incumbent|8|No|
||Director||||||
||Independent||||||
|Li Qingyuan||Male|42|Incumbent|4.33|No|
||Director||||||
||Independent||||||
|Mei Yonghong||Male|55|Incumbent|4.33|No|
||Director||||||
||Chairman of the||||||
|Dai Xianhua|Supervisory|Male|57|Incumbent|79.15|No|
||Board||||||
||Supervisor and||||||
||GM of Shenzhen||||||
||International||||||
|Wang Qiuping|Trade Center|Female|49|Incumbent|60.09|No|
||Property||||||
||Management Co.,||||||
||Ltd.||||||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||||||
|-|-|-|-|-|-|-|
||Supervisor and||||||
||deputy director of||||||
|Gu Weimin||Female|38|Incumbent|49.53|No|
||the audit||||||
||department||||||
|Zhang Manhua|Supervisor|Male|44|Incumbent||Yes|
|Wang Xiuyan|Supervisor|Female|57|Former||Yes|
|Li Qinghua|Supervisor|Male|37|Incumbent||Yes|
||Deputy||||||
||secretary of the||||||
||Party committee,||||||
|Wei Xiaodong|Secretary of|Male|49|Incumbent|66.5|No|
||Committee for||||||
||Discipline||||||
||Inspection||||||
|Fan Weiping|Vice GM|Male|54|Incumbent|113.31|No|
|Cai Lili|Vice GM|Female|47|Incumbent|66.5|No|
|Li Peng|Vice GM|Male|43|Incumbent|84.37|No|
|Zhang Gejian|Vice GM|Male|44|Incumbent|90.58|No|
|Shen Xueying|CFO|Female|50|Incumbent|83.58|Yes|
|Total|--|--|--|--|997.78|--|

 Equity incentives for directors, supervisors and senior management in the Reporting Period:
□ Applicable√ Not applicable
V Employees
1. Number, Functions and Educational Backgrounds of Employees
|||
|-|-|
|Number of in-service employees of the Company as the parent|83|
|Number of in-service employees of major subsidiaries|5,421|
|Total number of in-service employees|5,504|
|Total number of paid employees in the Reporting Period|5,504|
|Number of retirees to whom the Company as the parent or its||
||0|
|major subsidiaries need to pay retirement pensions||
|Functions||
|Function|Employees|
|Production|3,838|
|Sales|213|
|Technical|915|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||
|-|-|
|Financial|203|
|Administrative|335|
|Total|5,504|
|Educational backgrounds||
|Educational background|Employees|
|College and Technical secondary school graduates and above|2,440|
|High school graduates and below|3,064|
|Total|5,504|

 2. Employee Remuneration Policy
As required by corporate development strategy, based on actual situation to insist the internal industrialization and the marketization among the industry of the remuneration principles of the Group and our Company adopts a differentiated management on different industries to satisfy market demands by appropriately increasing the remuneration distance to better attract and retain talents. In HQ and real estate enterprises, position type management idea is introduced, with all positions divided into Leader Group, Management Group, Professional Group, Business Group and Service Group at different remuneration levels. Meanwhile, the remuneration for professional technicians and that for medium-level management are kept overlapped. In this way, remuneration and career development are provided at the same time. To some extent, the remuneration is a little bit favorable for professionals in real estate development industry. With regard to other enterprises under the Company group, market reference is applied, but the key is to appropriately adjust remuneration for key positions or some positions with lower remuneration than market level.
3. Employee Training Plans
In 2019, based on the overall requirements of the Company to establish a learning organization and carry out business development, as well as the survey on training needs, the Company is going to reinforce training in specialized real estate courses, comprehensive caliber, expertise knowledge and team building with an aim of further increasing the comprehensive knowledge and improving the professional competence and skills of the team, seeking synchronized development between the Company and its employees and achieving the sustainable and sound development of the Company. The major contents of the training will include specialized real estate courses, comprehensive management capabilities, team development, professional skills, etc, with a combination of internal and external training to be conducted in a planned way, and all the employees will attend the training in different groups throughout the year.
4. Labor Outsourcing
□ Applicable√ Not applicable
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Part IX Corporate Governance
I General Information of Corporate Governance
During this Reporting Period, in accordance with the requirement of the Company Law, Securities Law, Code of Corporate Governance for Listed Companies in China and Stock Listing Rules of Shenzhen Stock Exchange as well as relevant laws and statutes of CSRC, the Company continuously regulated and perfected corporate governance structure, established and perfected internal management and control system and investigated in management activities of the Company, which promoted theCompany‘s standard management level.
As to the end of this Reporting Period, the internal control system of the Company is complete, accomplished and defined that in accordance with Company Law, Articles of Association and other laws and regulations as well as requirements of regulatory documents. The convene ofShareholders‘ General Meeting, the Board of Directors and Supervisory Board are strictly in accordance with relevant rules and regulations, all directors and supervisors earnestly and diligently commit their responsibilities. Corporate structure of the Company is complete and the operation of the Company is standardized.
With the goal of constructing a standard management structure, the Company has established related regulations onShareholders‘ Meeting, Board of Directors and Board of Supervisors, to ensure effective rights to decision-making, execution and supervision respectively.
TheShareholders‘ Meeting shall have the highest right to review and make decision on major issues, including theCompany‘s business idea, investment plan, major trading items, capital changes, appointment and dismissal of directors and supervisors, within the legal scope as defined by laws, regulations and rules like the Company Law and Articles of Corporation. The Company has established and strictly followed various regulations, including Rules of Procedure ofShareholders‘ Meeting, to ensure allshareholders‘ rights.
The Board of Directors has the right to business decision-making, responsible for the establishment and effective execution of theCompany‘s internal control as well. Besides, it further sets up four special committees, namely, Strategic Development& Investment Committee, Remuneration and Assessment Committee, Audit Committee and Nomination Committee, to improve its operating efficiency based on corresponding work rules.
The Board of Supervisors acts as a supervising organ for the Company. It checks theCompany‘s finance, and supervises all jobs of theCompany‘s directors and senior management. Also, it is responsible for and reports to theShareholders‘ Meeting.
The business management have the right to execution. They are appointed by the Board of Directors, and responsible for daily running of business management and internal control.
Based on the principle of science, simplicity and efficiency, the Company has established such functional departments as Office for Board of Directors, GeneralManager‘s Office, Cost Control Department, Planning Design Department, Human Resources Department, Development Management Department, Financial Management Department, Audit Department (Office for Board of Supervisors), Law and Risk Control Department, Lease Center, and Party Work Office. These departments perform their specific functions and carry out work in accordance with regulations on internal control, to ensure theCompany‘s healthy running.
The Company always pays attention to standardize the management for inside information, such as promulgating the Management Rules for Insiders, making clear about the contents of inside information, making the scope of insiders and accountability system for inside dealings. After reporting and submitting non-published information to the controlling shareholders, the Company all registered the relevant information of insiders and then submitted to securities regulatory authorities, as well as strictly controlled the transmission scope of inside information, further strengthened the security work of inside information. Upon Self-inspection, during this Reporting Period, there were no particulars about insiders took advantages of inside information to purchase or sell shares of the Company before the disclosure of major sensitive information that shall have an impact on the share price of the Company, nor any
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 investigation and punishment as well as rectification from the regulatory authority. From now on, the Company will continuously strengthen to learn relevant rules and laws, scrupulously execute the Management Rules for Insider Information and Insiders, standardize the corporate governance of the Company, do well the work of preventing inside dealings.
Indicate by tick market whether there is any material incompliance with the regulatory documents issued by the CSRC governing the governance of listed companies.
□ Yes√ No
No such cases in the Reporting Period.
II TheCompany’s Independence from Its Controlling Shareholder in Business, Personnel, Asset, Organization and Financial Affairs
The Company was independent from the controlling shareholder in business, personnel, assets, organization and finance to realize that independent personnel, independent finance, complete assets, independent organization and independent business.
1. In aspect of business: The Company was independent from the controlling shareholder with independent and complete business and independent operation capability. There was no business which was same or competitive with the controlling shareholder. 2. In aspect of personnel: The Company was complete independent from the controlling shareholder in terms of labor and personnel, management on remuneration. All Senior Executives drew the remuneration from the Company, and none held a post concurrently inshareholders‘ company. Personnel of the Company are independent, all ones signed labor contract with the Company. The Company was independent from the shareholders or other related parties in personnel management, social security, salary etc.
3. In aspect of asset: TheCompany‘s assets were complete and independent, the property relationship was clear. There was no capital occupation by controlling shareholder, and assets of the Company were completely independent from controlling shareholder. 4. In aspect of organization: TheCompany‘s organization was independent, and the Company implemented rules and regulations as well as responsibilities for all departments, formed independent responsibilities and rights, scientific and rational internal control system. Independence of the Company on operation and management is free from impact from controlling shareholders and other subordinated units. There were no controlling shareholders intervene organization of the Company.
5. In aspect of finance: TheCompany‘s finance was independent with independent finance department. The Company established the independent finance settling system and financial management system, had its own finance account and paid the tax in line with laws, run finance decision-making independently.
The controlling shareholder of the Company performed normatively with no conduct that intervened with the operation decision-making and operation activities directly or indirectly over theshareholders‘ general meeting, however, the controlling shareholder could influence on the significant decision-making through the shares holding.
III Horizontal Competition
□ Applicable√ Not applicable
IV Annual and Special General Meetings Convened during the Reporting Period
1. General Meeting Convened during the Reporting Period
|||||||
|-|-|-|-|-|-|
|||Investor|||Index to disclosed|
|Meeting|Type||Date of the meeting|Disclosure date||
|||participation ratio|||information|
||||||Announcement No.|
|The 1st General|Extraordinary|||||
|||64.06%|15 June 2018|16 June 2018|2018-21 on the|
|Meeting of 2018|General Meeting|||||
||||||Resolutions of the|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||
|-|
|2017 Annual|
|Meeting of|
|Shareholders|
|disclosed on|
|www.cninfo.com.cn,|
|Securities News and|
|Ta Kung|

2. Special General Meetings Convened at the Request of Preferred Shareholders with Resumed Voting Rights
□ Applicable√ Not applicable
V Performance of Duty by Independent Directors in the Reporting Period
1. Attendance of Independent Directors at Board Meetings and General Meetings
|||||||||
|-|-|-|-|-|-|-|-|
|Attendance of independent directors at board meetings and general meetings||||||||
||Total number|||||The||
||||Board|||||
||of board|||Board|Board|independent||
|||Board|meetings|||||
||meetings the|||meetings|meetings the|director failed|General|
|Independent||meetings|attended by|||||
||independent|||attended|independent|to attend two|meetings|
|director||attended on|way of|||||
||director was|||through a|director failed|consecutive|attended|
|||site|telecommunica|||||
||eligible to|||proxy|to attend|board meetings||
||||tion|||||
||attend|||||(yes/no)||
|Yuan Hongchang|7|1|6|0|0|No|1|
|Mei Yonghong|3|1|2|0|0|No|1|
|Li Qingyuan|3|1|2|0|0|No|1|

 Why any independent director failed to attend two consecutive board meetings:
Not applicable
2. Objections Raised by Independent Directors on Matters of the Company
Indicate by tick mark whether any independent directors raised any objections on any matter of the Company.
□ Yes√ No
No such cases in the Reporting Period.
3. Other Information about the Performance of Duty by Independent Directors
Indicate by tick mark whether any suggestions from independent directors were adopted by the Company.
√ Yes□ No
Suggestions from independent directors adopted or not adopted by the Company:
With attitude of credibility and diligence to the Company and all shareholders, independent directors was diligent and responsible,
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 reviewed all resolutions, and in line with their professional knowledge and capability, made independent, objective and fair judgment away from influence from the Company and principal shareholders of the Company. Also, independent directors expressed independent, objective and fair opinion on relevant events, which made practical efforts to safeguard interests of the Company and minority shareholders.
VI Performance of Duty by Specialized Committees under the Board in the Reporting Period The four special committees under theboard—the Strategic Development and Investment Committee, the Nomination Committee, the Remuneration and Appraisal Committee and the AuditCommittee—according to―Governance Principle of listedCompany‖,―Articles ofAssociation‖,―and Rules of Procedure of the Board ofDirectors‖ and implementation rules of special committee, earnestly performed their duties.
1. Duty Performance of Strategic Development and Investment Committee
During this Reporting Period, strategic development and investment committee paid attention to authorization of the board to project development and financing, kept good contact with the management and had a good knowledge of matters within their power. 2. Duty Performance of Remuneration and Assessment Committee
During this Reporting Period, remuneration and assessment committee earnestly performed their duties, kept good contact with the management and conducted several communication with the management for relevant matters.
3. Duty Performance of Audit Committee
During this Reporting Period, audit committee held on-the-spot working conference twice, listened to report of Mazars Certified Public Accountants (SGP) on audit work, deliberate preliminary audit opinion issued by Mazars Certified Public Accountants (SGP) and proposed their opinions about 2017 Financial Statement of the Company.
VII Performance of Duty by the Supervisory Committee
Indicate by tick mark whether the Supervisory Committee found any risk to the Company during its supervision in the Reporting Period.
□ Yes√ No
The Supervisory Committee raised no objections in the Reporting Period.
VIII Appraisal of and Incentive for Senior Management
Within this Reporting Period, the annual operating target plan 2018 was went forth to the management team by the Board of Directors, of which the Company adopted appraisal method by the score combination of operation index, category index and administrative goal. At the end of the fiscal year, the Board of Directors examined the final score. For senior executives of the Company, the Company adopted annual salary system in accordance with Management Measure for Annual Salary System of Directors, Supervisors and Senior Executives, which shall be implemented after the Board of Directors completing fiscal examination.
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 IX Internal Control
1. Material Internal Control Weaknesses Identified for the Reporting Period
□ Yes√ No
2. Internal Control Self-Evaluation Report
||||
|-|-|-|
|Disclosure date of the internal control|||
||30 March 2019||
|self-evaluation report|||
|Index to the disclosed internal control|||
||http://www.cninfo.com.cn||
|self-evaluation report|||
|Evaluated entities‘ combined assets as % of|||
||99.00%||
|consolidated total assets|||
|Evaluated entities‘ combined operating|||
|revenue as % of consolidated operating|100.00%||
|revenue|||
|Identification standards for internal control weaknesses|||
||Weaknesses in internal control over financial|Weaknesses in internal control not|
|Type|||
||reporting|related to financial reporting|
||Indications of the serious defect of the|If the following situation occurred, could|
||financial report were including: (1) to|be recognized as the serious defect and|
||execute the misstatement correction of the|other situation should be recognized as|
||great defect occurred on the reported and|the important defect or the common|
||disclosed financial report by the Company;|defect respectively according to the|
||(2) the audit institution discovered the|influenced degree: (1) the|
||current financial report had great defect|decision-making of the significant events|
||while the internal control of the Company|of the Company lacked of the collective|
||didn‘t found out during the operating|democratic decision-making process or|
||process; (3) the supervision of the|the collective democratic|
|Nature standard|Company‘s Audit and Risk Committee and|decision-making process was not|
||the internal audit department on the internal|normative; (2) the decision-making of|
||control was invalid; (4) there was significant|the Company was not scientific or the|
||corrupt practice among the Directors,|decision-making occurred serious|
||Supervisors or Senior Management.|mistakes; (3) the operating or the|
||Indications of the important defect of the|decision-making seriously violated the|
||financial report were including: (1) didn‘t|national laws and regulations; (4) the|
||abide by the universally acknowledged|Company occurred serious|
||accounting standard to choose and apply the|environmental pollution or other events|
||accounting policies; (2) had not built up the|seriously effected the social public|
||anti-fraud process and the control measures;|interests; (5) the media frequently|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||
|-|-|-|
||(3) had not built up the corresponding|o ccurred the significant negative news;|
||control mechanism or had not executed the|(6) lacked of the important business|
||corresponding compensating control for the|management system or the|
||accounting treatment which was|systematicness of the system operation|
||unconventional or with special transaction;|was invalid; (7) the constantly outflow of|
||(4) the control during the process of the|the key management personnel and|
||financial report at the period-end existed one|technical personnel of the Company; (8)|
||or multiple defects that could not guarantee|the great or significant internal control|
||the compile of the financial report reach the|defect of the Company could not be|
||goal of being real and complete. Common|timely modified; (9) the Company|
||defect: refers to the other control defect|constantly or plentifully occurred the|
||except for the above great defect and|significant internal control defects; (10)|
||significant defect.|other situation may lead the Company to|
|||seriously deviate from the control target.|
||Serious defect: potential misstatement of the||
||operating income≥1 % of the operating||
||income of the consolidated statements of the||
||current year, potential misstatement of the||
|||The Company compared the magnitude|
||total assets amount≥0.25% of the total||
|||of the direct property losses amount with|
||amount of the consolidated statements of the||
|||the net assets amount of the last fiscal|
||current year. Important defect: 0.75% of the||
|||year to confirm the quantitative criteria|
||operating income of the consolidated||
|||of the internal control as the follows:|
||statements of the current year||
|||serious defect: amount of the direct|
||≤misstatement<1 % of the operating income||
|||property losses≥0.5% of the net assets|
|Quantitative standard|of the consolidated statements of the current||
|||amount of the last fiscal year; important|
||year; 0.2% of the total amount of the||
|||defect: 0.4% of the net assets amount of|
||consolidated statements of the current year||
|||the last fiscal year ≤losses amount<0.5%|
||≤misstatement<0.25 of the total amount of||
|||of the net assets amount of the last fiscal|
||the consolidated statements of the current||
|||year; common defect: losses|
||year. Common defect: misstatement of the||
|||amount<0.4% of the net assets amount of|
||operating income<0.75% of the operating||
|||the last fiscal year|
||income of the consolidated statements of the||
||current year, misstatement of the total assets||
||amount<0.2 of the total assets amount of the||
||consolidated statements of the current year||
|Number of material weaknesses in internal|||
||0||
|control over financial reporting|||
|Number of material weaknesses in internal|||
||0||
|control not related to financial reporting|||
|Number of serious weaknesses in internal|||
||0||
|control over financial reporting|||
|Number of serious weaknesses in internal|||
||0||
|control not related to financial reporting|||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 X IndependentAuditor’s Report on Internal Control
√ Applicable□ Not applicable
|||
|-|-|
|Opinion paragraph in the independent auditor‘s report on internal control||
|We believe that Shenzhen Properties & Resources Development (Group) Ltd. maintained efficient internal control of financial||
|reports in all significant aspects according to ―Basic Standards of Corporate Internal Control‖ and relevant regulations.||
|Independent auditor‘s report on||
||Disclosed|
|internal control disclosed or not||
|Disclosure date|30 March 2019|
|Index to such report disclosed|http://www.cninfo.com.cn|
|Type of the auditor‘s opinion|Unmodified unqualified opinion|
|Material weaknesses in internal||
|control not related to financial|None|
|reporting||

Indicate by tick mark whether any modified opinion is expressed in the independentauditor‘s report on theCompany‘s internal control.
□ Yes√ No
Indicate by tick mark whether the independentauditor‘s report on theCompany‘s internal control is consistent with the internal control self-evaluation report issued by theCompany‘s Board.
√ Yes□ No
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Part X Corporate Bonds
Does the Company have any corporate bonds publicly offered on the stock exchange, which were outstanding before the date of thisReport‘s approval or were due but could not be redeemed in full?
No.
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Part XI Financial Statements
I IndependentAuditor’s Report
|||
|-|-|
|Type of the independent auditor‘s opinion|Unmodified unqualified opinion|
|Date of signing this report|29 March 2019|
|Name of the independent auditor|Ruihua Certified Public Accountants (LLP)|
|Reference number of Audit Report|Ruihua Audit Report【2019】No. 48400002|
|Name of the certified public accountants|Cai Xiaodong and Wang Huansen|

Text of theAuditor‘s Report
All shareholders of Shenzhen Properties& Resources Development (Group) Ltd.:
1. Opinion
We have audited the financial statements of Shenzhen Properties& Resources Development (Group) Ltd. (the―Company‖), which comprise the consolidated and parent company balance sheets as of 31 December 2018, the consolidated and parent company statements of income, cash flows and changes inowners‘ equity for the year then ended, as well as the notes to the financial statements.
In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated and parent company financial position of the Company at 31 December 2018, and the consolidated and parent company operating results and cash flows for the year then ended, in conformity with the Chinese Accounting Standards (CAS).
2. Basis for Opinion
We conducted our audits in accordance with the Audit Standards for Chinese Registered Accountants. Our responsibilities under those standards are further described in theAuditor‘s Responsibilities for Audit of Financial Statements section of our report. We are independent of the Company in accordance with the China Code of Ethics for Certified Public Accountants, and we have fulfilled our other ethical responsibilities in accordance with the said Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
3. Key audit items
Key audit items are the items that are considered most important for the audit of the current financial statements based on our professional judgment. The response to these items is based on the audit of the financial statements as a whole and the formation of audit opinions. We do not comment on these items separately. We confirm that the following items are key audit items needed to be expressed in the Audit Report.
(I) Revenue Recognition of Real Estate Development Projects
1. Description
As of 31 December 2018, the main business income (the income from the sales of real estate) reflected in the Notes to theGroup‘s consolidated financial statements was RMB 2.283 billion, accounting for81.90% of theGroup‘s total revenue. As the gross profit
accounted for96.02% of the consolidated gross profit, it shall be counted as the major source of income and profit for the Group.
Therefore, we count the income from theGroup‘s real estate development business as a key audit matter.
According to the revenue recognition accounting policy of SZPRD, the recognition of theCompany‘s real estate sales income must
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 meet the following conditions: the development product has been completed and qualified for acceptance, and the realization of sales revenue is recognized after the property is handed over to the owner in accordance with the contract. (See Note IV. 23―Revenue‖ for details).
2. Audit Treatment
During the audit of business income ofSZPRD‘s real estate development projects, the audit procedureswe‘ve implemented mainly include: We evaluated the effectiveness of the design and operation of key internal controls related to the revenue recognition of real estate development projects; we checked all provisions stated in the real estate sales contract to verify whether the income recognition policy ofSZPRD‘s real estate development projects meets the requirements of relevant accounting standards; we took samples from the project whose real estate sales revenue was recognized to check the sales contract, the payment status and the receipt of the building and to evaluate whether relevant real estate sales were recognized in accordance with theGroup‘s revenue recognition policy; for various projects whose real estate sales revenue was recognized before and after the balance sheet date, we selected some samples, checked the sales contract, the payment status and the receipt of the building to evaluate whether relevant real estate sales revenue was recognized during the appropriate period; for the real estate income recognized in this year, we re-calculated various taxes and verified whether there existed any difference.
(II) Calculation and Withdrawal of Land Appreciation Tax
1. Description
The land value-added tax is one of the major taxes payable by SZPRD, and for the real estate sold and developed by SZPRD,it‘s required to pay the land value-added tax based on the land value-added amount resulting from the transfer of real estate and the progressive tax rate of30% to60%. However, for various real estate development enterprises specialized in constructing ordinary standard residential buildings for sales, if the value-added amount does not exceed20% of the deducted project amount, they shall be exempted from paying the land value-added tax; otherwise, related taxes shall be calculated based on the added value. Therefore, at the end of each financial reporting period, the management needs to estimate the amount of the land value-added tax. In making the judgment on the estimation, main factors required to be considered include the provisions and explanations of relevant tax laws and regulations, and the estimated real estate sales revenue minus the estimated deductible land costs, real estate development costs, interest expenses, development costs etc. When SZPRD clears the land value-added tax, the actual tax payable may differ from the amount estimated by SZPRD. As the accrued land value-added tax accounts for a large proportion in the taxes and taxes payable reflected in the consolidated financial statements, and themanagement‘s judgment on the estimation includes various considerations such as the understanding of relevant tax laws, regulations and practices. Therefore, we have counted the accrual of the land value-added tax of SZPRD as a key audit matter.
2. Audit Treatment
Evaluate the effectiveness of the design and operation of key internal controls related to the land value-added tax made by the management; the evaluation of the accrual of the land value-added tax on 31 December 2018 by SZPRD, includes the evaluation ofSZPRD‘s assumptions and judgment based on our understanding of the actual implementation of related tax laws by various local tax authorities, the evaluation of themanagement‘s estimations on the expected income from the real estate sales and on the deductible amount, the evaluation of themanagement‘s assumptions and judgment, the re-calculation of the land value-added tax accrued by SZPRD, and the comparison between our calculated results and the amount recorded by SZPRD.
We confirm that there are no other key audit matters that need to be expressed in the audit report issued by us.
4. Other Information
TheCompany‘s management is responsible for the other information. The other information comprises all of the information included in theCompany‘s 2018 Annual Report other than the financial statements and ourauditor‘s report thereon.
Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
5. Responsibilities of Management and Those Charged with Governance for Financial Statements
TheCompany‘s Management (hereinafter referred to as the―Management‖) is responsible for the preparation of the financial statements that give a fair view in accordance with CAS, and for designing, implementing and maintaining such internal control as the management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the Management is responsible for assessing theCompany‘s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Management either intends to liquidate the Company or to cease operations, or have no realistic alternative but to do so.
Those charged with governance are responsible for overseeing theCompany‘s financial reporting process.
6.Auditor’s Responsibilities for Audit of Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue anauditor‘s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with CAS will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with CAS, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
(1) Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
(2) Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances.
(3) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the management.
(4) Conclude on the appropriateness of themanagement‘s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on theCompany‘s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required by CAS to drawusers‘ attention in ourauditor‘s report to the related disclosures in the financial statements or. if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of ourauditor‘s report. However, future events or conditions may cause the Company to cease to continue as a going concern.
(5) Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
(6) Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Company to express an opinion on the financial statements. We are responsible for the direction, supervision and performance of the Company audit. We remain solely responsible for our audit opinion.
We communicate with those charged with governance regarding the planned scope and timing of the audit and significant audit findings, including any noteworthy deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and communicate with them all relationships and other matters that may reasonably be thought to bear on our
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in ourauditor‘s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Ruihua Certified Public Accountants Chinese CPA
(Engagement Partner)
Cai Xiaodong
Beijing· China Chinese CPA
Wang Huansen
29 March 2019
II Financial Statements
Currency unit for the financial statements and the notes thereto: RMB
1. Consolidated Balance Sheet
Prepared by ShenZhen Properties& Resources Development (Group) Ltd.
31 December 2018
Unit: RMB
||||
|-|-|-|
|Item|31 December 2018|31 December 2017|
|Current assets:|||
|Monetary capital|3,389,234,357.72|2,477,028,815.21|
|Settlement reserve|||
|Interbank loans granted|||
|Financial assets at fair value through|||
|profit or loss|||
|Derivative financial assets|||
|Notes and accounts receivable|64,231,267.94|46,272,600.86|
|Including: Notes receivable|||
|Accounts receivable|64,231,267.94|46,272,600.86|
|Prepayments|35,913,164.32|28,149,956.60|
|Premiums receivable|||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||
|-|-|-|
|Reinsurance receivables|||
|Receivable reinsurance contract reserve|||
|Other receivables|24,428,411.19|91,345,782.84|
|Including: Interest receivable|8,293,317.33||
|Dividends receivable|||
|Financial assets purchased under resale|||
|agreements|||
|Inventories|1,181,762,531.67|1,850,672,044.36|
|Assets classified as held for sale|||
|Current portion of non-current assets|||
|Other current assets|16,694,408.12|12,370,820.97|
|Total current assets|4,712,264,140.96|4,505,840,020.84|
|Non-current assets:|||
|Loans and advances to customers|||
|Available-for-sale financial assets|3,621,381.11|3,591,209.20|
|Held-to-maturity investments|||
|Long-term receivables|||
|Long-term equity investments|39,999,283.24|38,730,392.96|
|Investment property|400,550,689.90|426,849,558.05|
|Fixed assets|32,612,592.40|29,346,901.33|
|Construction in progress|||
|Productive living assets|||
|Oil and gas assets|||
|Intangible assets|||
|R&D expense|||
|Goodwill|||
|Long-term prepaid expense|2,398,576.29|951,368.85|
|Deferred income tax assets|519,783,531.64|388,022,097.64|
|Other non-current assets|108,971,942.00||
|Total non-current assets|1,107,937,996.58|887,491,528.03|
|Total assets|5,820,202,137.54|5,393,331,548.87|
|Current liabilities:|||
|Short-term borrowings|||
|Borrowings from central bank|||
|Customer deposits and interbank|||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||
|-|-|-|
|deposits|||
|Interbank loans obtained|||
|Financial liabilities at fair value through|||
|profit or loss|||
|Derivative financial liabilities|||
|Notes and accounts payable|398,429,855.96|491,963,303.62|
|Advances from customers|265,338,215.34|516,984,711.11|
|Financial assets sold under repurchase|||
|agreements|||
|Handling charges and commissions|||
|payable|||
|Payroll payable|96,069,521.54|92,066,474.54|
|Taxes payable|1,552,720,630.59|1,192,587,256.66|
|Other payables|112,502,146.69|122,622,000.38|
|Including: Interest payable|1,669.10||
|Dividends payable|29,642.40|29,642.40|
|Reinsurance payables|||
|Insurance contract reserve|||
|Payables for acting trading of securities|||
|Payables for underwriting of securities|||
|Liabilities directly associated with assets|||
|classified as held for sale|||
|Current portion of non-current liabilities|||
|Other current liabilities|||
|Total current liabilities|2,425,060,370.12|2,416,223,746.31|
|Non-current liabilities:|||
|Long-term borrowings|1,000,000.00||
|Bonds payable|||
|Including: Preferred shares|||
|Perpetual bonds|||
|Long-term payables|||
|Long-term payroll payable|||
|Provisions|||
|Deferred income|||
|Deferred income tax liabilities|5,275.60|8,668.15|
|Other non-current liabilities|52,937,180.81|54,543,253.27|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||
|-|-|-|
|Total non-current liabilities|53,942,456.41|54,551,921.42|
|Total liabilities|2,479,002,826.53|2,470,775,667.73|
|Owners‘ equity:|||
|Share capital|595,979,092.00|595,979,092.00|
|Other equity instruments|||
|Including: Preferred shares|||
|Perpetual bonds|||
|Capital reserves|118,938,132.89|118,938,132.89|
|Less: Treasury stock|||
|Other comprehensive income|-1,786,181.69|-4,111,587.14|
|Specific reserve|||
|Surplus reserves|299,569,569.96|299,569,569.96|
|General reserve|||
|Retained earnings|2,325,248,711.48|1,911,318,586.37|
|Total equity attributable to owners of theCompany as the parent|||
||3,337,949,324.64|2,921,693,794.08|
|Non-controlling interests|3,249,986.37|862,087.06|
|Total owners‘ equity|3,341,199,311.01|2,922,555,881.14|
|Total liabilities and owners‘ equity|5,820,202,137.54|5,393,331,548.87|

 Legal representative: Liu Shengxiang Head of financial affairs: Cai Lili
Head of the financial department: Liu Qiang
2. Balance Sheet of the Company as the Parent
Unit: RMB
||||
|-|-|-|
|Item|31 December 2018|31 December 2017|
|Current assets:|||
|Monetary capital|2,520,788,994.16|1,754,272,751.45|
|Financial assets at fair value through|||
|profit or loss|||
|Derivative financial assets|||
|Notes and accounts receivable|1,853,494.72|479,462.50|
|Including: Notes receivable|||
|Accounts receivable|1,853,494.72|479,462.50|
|Prepayments|829,683.68|496,729.09|
|Other receivables|1,306,715,826.93|1,128,977,669.02|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||
|-|-|-|
|Including: Interest receivable|8,229,503.58||
|Dividends receivable|||
|Inventories|105,840,115.24|303,797,408.60|
|Assets classified as held for sale|||
|Current portion of non-current assets|||
|Other current assets||85,558.19|
|Total current assets|3,936,028,114.73|3,188,109,578.85|
|Non-current assets:|||
|Available-for-sale financial assets|3,851,881.11|3,821,709.20|
|Held-to-maturity investments|||
|Long-term receivables|||
|Long-term equity investments|239,501,956.17|250,613,065.89|
|Investment property|317,313,917.65|336,964,573.31|
|Fixed assets|9,121,637.65|8,163,838.55|
|Construction in progress|||
|Productive living assets|||
|Oil and gas assets|||
|Intangible assets|||
|R&D expense|||
|Goodwill|||
|Long-term prepaid expense|778,392.57|951,368.85|
|Deferred income tax assets|315,888,967.26|191,632,218.83|
|Other non-current assets|104,132,920.00||
|Total non-current assets|990,589,672.41|792,146,774.63|
|Total assets|4,926,617,787.14|3,980,256,353.48|
|Current liabilities:|||
|Short-term borrowings|||
|Financial liabilities at fair value through|||
|profit or loss|||
|Derivative financial liabilities|||
|Notes and accounts payable|124,501,464.28|119,489,366.28|
|Advances from customers|75,895,087.75|5,127,871.19|
|Payroll payable|31,224,455.28|34,296,032.66|
|Taxes payable|1,402,388,742.76|704,897,740.79|
|Other payables|224,875,980.31|206,906,599.52|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||
|-|-|-|
|Including: Interest payable|||
|Dividends payable|29,642.40|29,642.40|
|Liabilities directly associated with assets|||
|classified as held for sale|||
|Current portion of non-current liabilities|||
|Other current liabilities|||
|Total current liabilities|1,858,885,730.38|1,070,717,610.44|
|Non-current liabilities:|||
|Long-term borrowings|||
|Bonds payable|||
|Including: Preferred shares|||
|Perpetual bonds|||
|Long-term payables|||
|Long-term payroll payable|||
|Provisions|||
|Deferred income|||
|Deferred income tax liabilities|||
|Other non-current liabilities|||
|Total non-current liabilities|||
|Total liabilities|1,858,885,730.38|1,070,717,610.44|
|Owners‘ equity:|||
|Share capital|595,979,092.00|595,979,092.00|
|Other equity instruments|||
|Including: Preferred shares|||
|Perpetual bonds|||
|Capital reserves|92,326,467.62|94,057,859.68|
|Less: Treasury stock|||
|Other comprehensive income|||
|Specific reserve|||
|Surplus reserves|298,912,759.52|298,912,759.52|
|Retained earnings|2,080,513,737.62|1,920,589,031.84|
|Total owners‘ equity|3,067,732,056.76|2,909,538,743.04|
|Total liabilities and owners‘ equity|4,926,617,787.14|3,980,256,353.48|

3. Consolidated Income Statement
Unit: RMB
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||
|-|-|-|
|Item|2018|2017|
|1. Revenue|2,787,240,632.53|2,904,690,690.53|
|Including: Operating revenue|2,787,240,632.53|2,904,690,690.53|
|Interest income|||
|Premium income|||
|Handling charge and|||
|commission income|||
|2. Costs and expenses|2,013,464,731.84|2,178,847,472.64|
|Including: Cost of sales|1,315,189,991.84|1,627,867,905.64|
|Interest expense|||
|Handling charge and|||
|commission expense|||
|Surrenders|||
|Net claims paid|||
|Net amount provided as|||
|insurance contract reserve|||
|Expenditure on policy|||
|dividends|||
|Reinsurance premium|||
|expense|||
|Taxes and surcharges|613,426,966.17|463,876,115.22|
|Selling expense|46,501,225.18|31,179,193.33|
|Administrative expense|102,852,213.19|137,028,655.69|
|R&D expense|||
|Finance costs|-57,579,532.57|-24,407,456.38|
|Including: Interest|||
|expense|||
|Interest|||
||58,627,284.65|25,827,011.83|
|income|||
|Asset impairment loss|-6,926,131.97|-56,696,940.86|
|Add: Other income|||
|Investment income (―-‖ for loss)|1,889,021.11|106,874,030.32|
|Including: Share of profit or|||
||1,268,890.28|1,978,501.84|
|loss of joint ventures and associates|||
|Gain on changes in fair value (―-‖|||
|for loss)|||
|Foreign exchange gain (―-‖ for|||
|loss)|||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||
|-|-|-|
|Asset disposal income (―-‖ for|||
||-8,096.97|-11,772.11|
|loss)|||
|3. Operating profit (―-‖ for loss)|775,656,824.83|832,705,476.10|
|Add: Non-operating income|4,859,143.80|1,759,894.83|
|Less: Non-operating expense|3,040,842.92|7,717,750.16|
|4. Profit before tax (―-‖ for loss)|777,475,125.71|826,747,620.77|
|Less: Income tax expense|184,813,373.69|203,784,886.40|
|5. Net profit (―-‖ for net loss)|592,661,752.02|622,962,734.37|
|5.1 Net profit from continuing|||
||592,661,752.02|548,933,658.73|
|operations (―-‖ for net loss)|||
|5.2 Net profit from discontinued|||
|||74,029,075.64|
|operations (―-‖ for net loss)|||
|Net profit attributable to owners of|||
||592,723,852.71|622,962,734.37|
|the Company as the parent|||
|Net profit attributable to|||
||-62,100.69|0.00|
|non-controlling interests|||
|6. Other comprehensive income, net of|||
||2,325,405.45|-3,414,038.44|
|tax|||
|Attributable to owners of the|||
||2,325,405.45|-3,414,038.44|
|Company as the parent|||
|6.1 Items that will not be|||
|reclassified to profit or loss|||
|6.1.1 Changes caused by|||
|remeasurements on defined benefit|||
|pension schemes|||
|6.1.2 Share of other|||
|comprehensive income of investees that|||
|will not be reclassified to profit or loss|||
|under equity method|||
|6.2 Items that may subsequently be|||
||2,325,405.45|-3,414,038.44|
|reclassified to profit or loss|||
|6.2.1 Share of other|||
|comprehensive income of investees that|||
|will be reclassified to profit or loss|||
|under equity method|||
|6.2.2 Gain/Loss on changes in|||
|fair value of available-for-sale financial|||
|assets|||
|6.2.3 Gain/Loss arising from|||
|reclassification of held-to-maturity|||
|investments to available-for-sale|||
|financial assets|||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||
|-|-|-|
|6.2.4 Effective gain/loss on cash|||
|flow hedges|||
|6.2.5 Differences arising from|||
|translation of foreign|||
||2,325,405.45|-3,414,038.44|
|currency-denominated financial|||
|statements|||
|6.2.6 Other|||
|Attributable to non-controlling|||
|interests|||
|7. Total comprehensive income|594,987,157.47|619,548,695.93|
|Attributable to owners of the|||
||595,049,258.16|619,548,695.93|
|Company as the parent|||
|Attributable to non-controlling|||
||-62,100.69||
|interests|||
|8. Earnings per share|||
|8.1 Basic earnings per share|0.9945|1.0453|
|8.2 Diluted earnings per share|0.9945|1.0453|

 Where business combinations under common control occurred in the current period, the net profit achieved by the acquirees before the combinations was RMB0.00, with the amount for last year being RMB0.00.
Legal representative: Liu Shengxiang Head of financial affairs: Cai Lili
Head of the financial department: Liu Qiang
4. Income Statement of the Company as the Parent
Unit: RMB
||||
|-|-|-|
|Item|2018|2017|
|1. Operating revenue|1,280,644,589.75|974,400,482.05|
|Less: Cost of sales|225,828,386.48|191,844,816.06|
|Taxes and surcharges|525,630,333.93|355,615,402.19|
|Selling expense|19,343,750.44|4,602,356.70|
|Administrative expense|47,578,406.12|67,072,041.58|
|R&D expense|||
|Finance costs|-54,255,168.19|-10,220,836.89|
|Including: Interest expense|||
|Interest income|50,378,375.05|17,390,604.23|
|Asset impairment loss|47,377,759.48|1,250,188.43|
|Add: Other income|||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||
|-|-|-|
|Investment income (―-‖ for loss)|1,834,522.57|570,972,139.28|
|Including: Share of profit or|||
||1,268,890.28|1,978,501.84|
|loss of joint ventures and associates|||
|Gain on changes in fair value (―-‖|||
|for loss)|||
|Asset disposal income (―-‖ for|||
|loss)|||
|2. Operating profit (―-‖ for loss)|470,975,644.06|935,208,653.26|
|Add: Non-operating income|963,333.70|222,418.81|
|Less: Non-operating expense|711,102.23|7,030,356.88|
|3. Profit before tax (―-‖ for loss)|471,227,875.53|928,400,715.19|
|Less: Income tax expense|132,509,442.15|119,553,327.36|
|4. Net profit (―-‖ for net loss)|338,718,433.38|808,847,387.83|
|4.1 Net profit from continuing|||
||338,718,433.38|718,383,636.46|
|operations (―-‖ for net loss)|||
|4.2 Net profit from discontinued|||
|||90,463,751.37|
|operations (―-‖ for net loss)|||
|5. Other comprehensive income, net of|||
|tax|||
|5.1 Items that will not be reclassified|||
|to profit or loss|||
|5.1.1 Changes in caused by|||
|remeasurements on defined benefit|||
|pension schemes|||
|5.1.2 Share of other|||
|comprehensive income of investees that|||
|will not be reclassified to profit or loss|||
|under equity method|||
|5.2 Items that may subsequently be|||
|reclassified to profit or loss|||
|5.2.1 Share of other|||
|comprehensive income of investees that|||
|will be reclassified to profit or loss|||
|under equity method|||
|5.2.2 Gain/Loss on changes in fair|||
|value of available-for-sale financial|||
|assets|||
|5.2.3 Gain/Loss arising from|||
|reclassification of held-to-maturity|||
|investments to available-for-sale|||
|financial assets|||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||
|-|-|-|
|5.2.4 Effective gain/loss on cash|||
|flow hedges|||
|5.2.5 Differences arising from|||
|translation of foreign|||
|currency-denominated financial|||
|statements|||
|5.2.6 Other|||
|6. Total comprehensive income|338,718,433.38|808,847,387.83|
|7. Earnings per share|||
|7.1 Basic earnings per share|0.5683|1.3572|
|7.2 Diluted earnings per share|0.5683|1.3572|

 5. Consolidated Cash Flow Statement
Unit: RMB
||||
|-|-|-|
|Item|2018|2017|
|1. Cash flows from operating activities:|||
|Proceeds from sale of commodities|||
||2,691,977,990.38|1,298,880,512.56|
|and rendering of services|||
|Net increase in customer deposits and|||
|interbank deposits|||
|Net increase in borrowings from|||
|central bank|||
|Net increase in loans from other|||
|financial institutions|||
|Premiums received on original|||
|insurance contracts|||
|Net proceeds from reinsurance|||
|Net increase in deposits and|||
|investments of policy holders|||
|Net increase in proceeds from|||
|disposal of financial assets at fair value|||
|through profit or loss|||
|Interest, handling charges and|||
|commissions received|||
|Net increase in interbank loans|||
|obtained|||
|Net increase in proceeds from|||
|repurchase transactions|||
|Tax rebates|||
|Cash generated from other operating|||
||54,180,568.38|38,657,341.63|
|activities|||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||
|-|-|-|
|Subtotal of cash generated from|||
||2,746,158,558.76|1,337,537,854.19|
|operating activities|||
|Payments for commodities and|||
||435,818,332.73|515,987,168.02|
|services|||
|Net increase in loans and advances to|||
|customers|||
|Net increase in deposits in central|||
|bank and in interbank loans granted|||
|Payments for claims on original|||
|insurance contracts|||
|Interest, handling charges and|||
|commissions paid|||
|Policy dividends paid|||
|Cash paid to and for employees|362,508,689.89|331,180,621.68|
|Taxes paid|731,616,830.74|746,485,110.50|
|Cash used in other operating|||
||92,619,777.81|90,154,714.93|
|activities|||
|Subtotal of cash used in operating|||
||1,622,563,631.17|1,683,807,615.13|
|activities|||
|Net cash generated from/used in|||
||1,123,594,927.59|-346,269,760.94|
|operating activities|||
|2. Cash flows from investing activities:|||
|Proceeds from disinvestment|||
|Investment income|||
|Net proceeds from disposal of fixed|||
|assets, intangible assets and other|115,072.54|11,700.85|
|long-lived assets|||
|Net proceeds from disposal of|||
||79,901,686.57|68,050,370.55|
|subsidiaries or other business units|||
|Cash generated from other investing|||
|activities|||
|Subtotal of cash generated from|||
||80,016,759.11|68,062,071.40|
|investing activities|||
|Payments for acquisition of fixed|||
|assets, intangible assets and other|17,185,136.22|3,721,869.38|
|long-lived assets|||
|Payments for investments|100,000,000.00||
|Net increase in pledged loans granted|||
|Net payments for acquisition of|||
|subsidiaries and other business units|||
|Cash used in other investing|||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||
|-|-|-|
|activities|||
|Subtotal of cash used in investing|||
||117,185,136.22|3,721,869.38|
|activities|||
|Net cash generated from/used in|||
||-37,168,377.11|64,340,202.02|
|investing activities|||
|3. Cash flows from financing activities:|||
|Capital contributions received|2,450,000.00||
|Including: Capital contributions by|||
||2,450,000.00||
|non-controlling interests to subsidiaries|||
|Increase in borrowings obtained|1,000,000.00||
|Net proceeds from issuance of bonds|||
|Cash generated from other financing|||
|activities|||
|Subtotal of cash generated from|||
||3,450,000.00||
|financing activities|||
|Repayment of borrowings|||
|Payments for interest and dividends|178,793,727.60|107,246,594.16|
|Including: Dividends paid by|||
|subsidiaries to non-controlling interests|||
|Cash used in other financing|||
|activities|||
|Subtotal of cash used in financing|||
||178,793,727.60|107,246,594.16|
|activities|||
|Net cash generated from/used in|||
||-175,343,727.60|-107,246,594.16|
|financing activities|||
|4. Effect of foreign exchange rate|||
||5,212.00|-3,550,248.56|
|changes on cash and cash equivalents|||
|5. Net increase in cash and cash|||
||911,088,034.88|-392,726,401.64|
|equivalents|||
|Add: Cash and cash equivalents,|||
||2,464,626,655.21|2,857,353,056.85|
|beginning of the period|||
|6. Cash and cash equivalents, end of the|||
||3,375,714,690.09|2,464,626,655.21|
|period|||

6. Cash Flow Statement of the Company as the Parent
Unit: RMB
||||
|-|-|-|
|Item|2018|2017|
|1. Cash flows from operating activities:|||
|Proceeds from sale of commodities|||
||1,414,305,014.68|65,757,450.31|
|and rendering of services|||
|Tax rebates|||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||
|-|-|-|
|Cash generated from other operating|||
||43,112,205.17|21,716,848.94|
|activities|||
|Subtotal of cash generated from|||
||1,457,417,219.85|87,474,299.25|
|operating activities|||
|Payments for commodities and|||
||7,075,382.01|44,735,175.71|
|services|||
|Cash paid to and for employees|38,651,894.17|21,174,100.46|
|Taxes paid|148,571,148.46|339,287,204.18|
|Cash used in other operating|||
||246,528,170.36|272,205,006.82|
|activities|||
|Subtotal of cash used in operating|||
||440,826,595.00|677,401,487.17|
|activities|||
|Net cash generated from/used in|||
||1,016,590,624.85|-589,927,187.92|
|operating activities|||
|2. Cash flows from investing activities:|||
|Proceeds from disinvestment|||
|Investment income||798,375,302.27|
|Net proceeds from disposal of fixed|||
|assets, intangible assets and other||8,377.85|
|long-lived assets|||
|Net proceeds from disposal of|||
||73,001,849.11|88,010,664.30|
|subsidiaries or other business units|||
|Cash generated from other investing|||
|activities|||
|Subtotal of cash generated from|||
||73,001,849.11|886,394,344.42|
|investing activities|||
|Payments for acquisition of fixed|||
|assets, intangible assets and other|4,936,323.59|585,878.55|
|long-lived assets|||
|Payments for investments|100,000,000.00|1,000,000.00|
|Net payments for acquisition of|||
||39,351,392.06||
|subsidiaries and other business units|||
|Cash used in other investing|||
|activities|||
|Subtotal of cash used in investing|||
||144,287,715.65|1,585,878.55|
|activities|||
|Net cash generated from/used in|||
||-71,285,866.54|884,808,465.87|
|investing activities|||
|3. Cash flows from financing activities:|||
|Capital contributions received|||
|Increase in borrowings obtained|||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||
|-|-|-|
|Net proceeds from issuance of bonds|||
|Cash generated from other financing|||
|activities|||
|Subtotal of cash generated from|||
|financing activities|||
|Repayment of borrowings|||
|Payments for interest and dividends|178,793,727.60|107,246,594.16|
|Cash used in other financing|||
|activities|||
|Sub-total of cash used in financing|||
||178,793,727.60|107,246,594.16|
|activities|||
|Net cash generated from/used in|||
||-178,793,727.60|-107,246,594.16|
|financing activities|||
|4. Effect of foreign exchange rate|||
||5,212.00|-17,273.22|
|changes on cash and cash equivalents|||
|5. Net increase in cash and cash|||
||766,516,242.71|187,617,410.57|
|equivalents|||
|Add: Cash and cash equivalents,|||
||1,754,272,751.45|1,566,655,340.88|
|beginning of the period|||
|6. Cash and cash equivalents, end of the|||
||2,520,788,994.16|1,754,272,751.45|
|period|||

7. Consolidated Statements of Changes inOwners’ Equity
2018
Unit: RMB
|||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
||2018|||||||||||||
||Equity attributable to owners of the Company as the parent|||||||||||||
|||Other equity||||||||||Non-co||
|Item|||||||Other||||Retaine||Total|
|||instruments||||Less:||||||ntrollin||
||Share||||Capital||compre|Specific|Surplus|General|d||owners‘|
|||Prefer|Perpe|t||Treasur||||||g||
||capital||||reserves||hensive|reserve|reserves|reserve|earning||equity|
|||red|ual|Other||y stock||||||interests||
||||||||income||||s|||
|||shares|bonds|||||||||||
|1. Balances as at|595,97||||||||||1,911,3||2,922,5|
||||||118,938||-4,111,5||299,569|||862,087||
|the end of the prior|9,092.||||||||||18,586.||55,881.|
||||||,132.89||87.14||,569.96|||.06||
|year|00||||||||||37||14|
|Add: Adjustments||||||||||||||
|for changed||||||||||||||
|accounting||||||||||||||
|policies||||||||||||||
|Adjustments for||||||||||||||
|corrections of||||||||||||||
|previous errors||||||||||||||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||||||
|-|-|-|-|-|-|-|-|
|Adjustments for||||||||
|business||||||||
|combinations||||||||
|under common||||||||
|control||||||||
|Other||||||||
|adjustments||||||||
|2. Balances as at|595,97||||1,911,3||2,922,5|
|||118,938|-4,111,5|299,569||862,087||
|the beginning of|9,092.||||18,586.||55,881.|
|||,132.89|87.14|,569.96||.06||
|the year|00||||37||14|
|3. Increase/||||||||
|decrease in the|||2,325,4||413,930|2,387,8|418,643|
|period (―-‖ for|||05.45||,125.11|99.31|,429.87|
|decrease)||||||||
|3.1 Total||||||||
||||2,325,4||592,723|-62,100.|594,987|
|comprehensive||||||||
||||05.45||,852.71|69|,157.47|
|income||||||||
|3.2 Capital||||||||
|||||||2,450,0|2,450,0|
|increased and||||||||
|||||||00.00|00.00|
|reduced by owners||||||||
|3.2.1||||||||
|Ordinary shares||||||2,450,0|2,450,0|
|increased by||||||00.00|00.00|
|shareholders||||||||
|3.2.2 Capital||||||||
|increased by||||||||
|holders of other||||||||
|equity instruments||||||||
|3.2.3||||||||
|Share-based||||||||
|payments included||||||||
|in owners‘ equity||||||||
|3.2.4 Other||||||||
||||||-178,79||-178,79|
|3.3 Profit||||||||
||||||3,727.6||3,727.6|
|distribution||||||||
||||||0||0|
|3.3.1||||||||
|Appropriation to||||||||
|surplus reserves||||||||
|3.3.2||||||||
|Appropriation to||||||||
|general reserve||||||||
|3.3.3|||||-178,79||-178,79|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||||||
|-|-|-|-|-|-|-|-|
|Appropriation to|||||3,727.6||3,727.6|
|owners (or|||||0||0|
|shareholders)||||||||
|3.3.4 Other||||||||
|3.4 Transfers||||||||
|within owners‘||||||||
|equity||||||||
|3.4.1 Increase||||||||
|in capital (or share||||||||
|capital) from||||||||
|capital reserves||||||||
|3.4.2 Increase||||||||
|in capital (or share||||||||
|capital) from||||||||
|surplus reserves||||||||
|3.4.3 Loss||||||||
|offset by surplus||||||||
|reserves||||||||
|3.4.4||||||||
|Changes in||||||||
|defined benefit||||||||
|pension schemes||||||||
|transferred to||||||||
|retained earnings||||||||
|3.4.5 Other||||||||
|3.5 Specific||||||||
|reserve||||||||
|3.5.1 Increase||||||||
|in the period||||||||
|3.5.2 Used in||||||||
|the period||||||||
|3.6 Other||||||||
|4. Balances as at|595,97||||2,325,2||3,341,199,311.01|
|||118,938|-1,786,1|299,569||3,249,9||
|the end of the|9,092.||||48,711.|||
|||,132.89|81.69|,569.96||86.37||
|period|00||||48|||

 2017
Unit: RMB
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
||2017|||||||||||
||Equity attributable to owners of the Company as the parent|||||||||||
|||||||||||Non-co|Total|
|Item||||||||||||
||Share|Other equity|Capital|Less:|Other|Specific|Surplus|General|Retaine|ntrollin|owners‘|
||capital|instruments|reserves|Treasur|compre|reserve|reserves|reserve|d|g|equity|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
|||Prefer|Perpet|||y stock|hensive||earnings|interest||
|||red|ual|Other|||income|||s||
|||shares|bonds|||||||||
|1. Balances as at|595,97||||||||1,441,6||2,411,2|
||||||119,951||-697,54|253,569||862,087||
|the end of the prior|9,092.||||||||32,088.||96,822.|
||||||,533.93||8.70|,569.96||.06||
|year|00||||||||56||81|
|Add: Adjustments||||||||||||
|for changed||||||||||||
|accounting||||||||||||
|policies||||||||||||
|Adjustments for||||||||||||
|corrections of||||||||||||
|previous errors||||||||||||
|Adjustments for||||||||||||
|business||||||||||||
|combinations||||||||||||
|under common||||||||||||
|control||||||||||||
|Other||||||||||||
|adjustments||||||||||||
|2. Balances as at|595,97||||||||1,441,6||2,411,2|
||||||119,951||-697,54|253,569||862,087||
|the beginning of|9,092.||||||||32,088.||96,822.|
||||||,533.93||8.70|,569.96||.06||
|the year|00||||||||56||81|
|3. Increase/||||||||||||
|decrease in the|||||-1,013,4||-3,414,0|46,000,|469,686||511,259|
|period (―-‖ for|||||01.04||38.44|000.00|,497.81||,058.33|
|decrease)||||||||||||
|3.1 Total||||||||||||
||||||||-3,414,0||622,962||619,548|
|comprehensive||||||||||||
||||||||38.44||,734.37||,695.93|
|income||||||||||||
|3.2 Capital||||||||||||
|increased and||||||||||||
|reduced by owners||||||||||||
|3.2.1||||||||||||
|Ordinary shares||||||||||||
|increased by||||||||||||
|shareholders||||||||||||
|3.2.2 Capital||||||||||||
|increased by||||||||||||
|holders of other||||||||||||
|equity instruments||||||||||||
|3.2.3||||||||||||
|Share-based||||||||||||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||||
|-|-|-|-|-|
|payments included|||||
|in owners‘ equity|||||
|3.2.4 Other|||||
||||-153,27|-107,27|
|3.3 Profit||46,000,|||
||||6,236.5|6,236.5|
|distribution||000.00|||
||||6|6|
|3.3.1|||||
|||46,000,|-46,000,||
|Appropriation to|||||
|||000.00|000.00||
|surplus reserves|||||
|3.3.2|||||
|Appropriation to|||||
|general reserve|||||
|3.3.3|||||
||||-107,27|-107,27|
|Appropriation to|||||
||||6,236.5|6,236.5|
|owners (or|||||
||||6|6|
|shareholders)|||||
|3.3.4 Other|||||
|3.4 Transfers|||||
||-1,013,4|||-1,013,4|
|within owners‘|||||
||01.04|||01.04|
|equity|||||
|3.4.1 Increase|||||
|in capital (or share|||||
|capital) from|||||
|capital reserves|||||
|3.4.2 Increase|||||
|in capital (or share|||||
|capital) from|||||
|surplus reserves|||||
|3.4.3 Loss|||||
|offset by surplus|||||
|reserves|||||
|3.4.4|||||
|Changes in|||||
|defined benefit|||||
|pension schemes|||||
|transferred to|||||
|retained earnings|||||
||-1,013,4|||-1,013,4|
|3.4.5 Other|||||
||01.04|||01.04|
|3.5 Specific|||||
|reserve|||||
|3.5.1 Increase|||||
|in the period|||||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||||||
|-|-|-|-|-|-|-|-|
|3.5.2 Used in||||||||
|the period||||||||
|3.6 Other||||||||
|4. Balances as at|595,97||||1,911,3||2,922,5|
|||118,938|-4,111,5|299,569||862,087||
|the end of the|9,092.||||18,586.||55,881.|
|||,132.89|87.14|,569.96||.06||
|period|00||||37||14|

 8. Statements of Changes inOwners’ Equity of the Company as the Parent
2018
Unit: RMB
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
||2018|||||||||||
|||Other equity instruments|||||Other|||||
|||||||Less:||||Retaine|Total|
|Item|Share||||Capital||comprehe|Specific|Surplus|||
|||Preferre|Perpetu|||Treasury||||d|owners‘|
||capital|||Other|reserves||nsive|reserve|reserves|||
|||d shares|a l bonds|||stock||||earnings|equity|
||||||||income|||||
|1. Balances as at||||||||||1,920,5||
||595,979,||||94,057,85||||298,912,7||2,909,538|
|the end of the prior||||||||||89,031.||
||092.00||||9.68||||59.52||,743.04|
|year||||||||||84||
|Add: Adjustments||||||||||||
|for changed||||||||||||
|accounting||||||||||||
|policies||||||||||||
|Adjustments for||||||||||||
|corrections of||||||||||||
|previous errors||||||||||||
|Other||||||||||||
|adjustments||||||||||||
|2. Balances as at||||||||||1,920,5||
||595,979,||||94,057,85||||298,912,7||2,909,538|
|the beginning of||||||||||89,031.||
||092.00||||9.68||||59.52||,743.04|
|the year||||||||||84||
|3. Increase/||||||||||||
|decrease in the|||||-1,731,39|||||159,924|158,193,3|
|period (―-‖ for|||||2.06|||||,705.78|13.72|
|decrease)||||||||||||
|3.1 Total||||||||||||
|||||||||||338,718|338,718,4|
|comprehensive||||||||||||
|||||||||||,433.38|33.38|
|income||||||||||||
|3.2 Capital||||||||||||
|increased and||||||||||||
|reduced by owners||||||||||||
|3.2.1||||||||||||
|Ordinary shares||||||||||||
|increased by||||||||||||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||
|-|-|-|-|
|shareholders||||
|3.2.2 Capital||||
|increased by||||
|holders of other||||
|equity instruments||||
|3.2.3||||
|Share-based||||
|payments included||||
|in owners‘ equity||||
|3.2.4 Other||||
|||-178,79||
|3.3 Profit|-1,731,39||-180,525,|
|||3,727.6||
|distribution|2.06||119.66|
|||0||
|3.3.1||||
|Appropriation to||||
|surplus reserves||||
|3.3.2||||
|||-178,79||
|Appropriation to|||-178,793,|
|||3,727.6||
|owners (or|||727.60|
|||0||
|shareholders)||||
|3.3.3 Other||||
|3.4 Transfers||||
|within owners‘||||
|equity||||
|3.4.1 Increase||||
|in capital (or share||||
|capital) from||||
|capital reserves||||
|3.4.2 Increase||||
|in capital (or share||||
|capital) from||||
|surplus reserves||||
|3.4.3 Loss||||
|offset by surplus||||
|reserves||||
|3.4.4 Changes||||
|in defined benefit||||
|pension schemes||||
|transferred to||||
|retained earnings||||
||-1,731,39||-1,731,39|
|3.4.5 Other||||
||2.06||2.06|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||||
|-|-|-|-|-|-|
|3.5 Specific||||||
|reserve||||||
|3.5.1 Increase||||||
|in the period||||||
|3.5.2 Used in||||||
|the period||||||
|3.6 Other||||||
|4. Balances as at||||2,080,5|3,067,732,056.76|
||595,979,|92,326,46|298,912,7|||
|the end of the||||13,737.||
||092.00|7.62|59.52|||
|period||||62||

2017
Unit: RMB
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
||2017|||||||||||
|||Other equity instruments|||||Other|||||
|||||||Less:||||Retaine|Total|
|Item|Share||||Capital||comprehe|Specific|Surplus|||
|||Preferre|Perpetu|||Treasury||||d|owners‘|
||capital|||Other|reserves||nsive|reserve|reserves|||
|||d shares|a l bonds|||stock||||earnings|equity|
||||||||income|||||
|1. Balances as at||||||||||1,265,0||
||595,979,||||94,057,85||||252,912,7||2,207,967|
|the end of the prior||||||||||17,880.||
||092.00||||9.68||||59.52||,591.77|
|year||||||||||57||
|Add: Adjustments||||||||||||
|for changed||||||||||||
|accounting||||||||||||
|policies||||||||||||
|Adjustments for||||||||||||
|corrections of||||||||||||
|previous errors||||||||||||
|Other||||||||||||
|adjustments||||||||||||
|2. Balances as at||||||||||1,265,0||
||595,979,||||94,057,85||||252,912,7||2,207,967|
|the beginning of||||||||||17,880.||
||092.00||||9.68||||59.52||,591.77|
|the year||||||||||57||
|3. Increase/||||||||||||
|decrease in the|||||||||46,000,00|655,571|701,571,1|
|period (―-‖ for|||||||||0.00|,151.27|51.27|
|decrease)||||||||||||
|3.1 Total||||||||||||
|||||||||||808,847|808,847,3|
|comprehensive||||||||||||
|||||||||||,387.83|87.83|
|income||||||||||||
|3.2 Capital||||||||||||
|increased and||||||||||||
|reduced by owners||||||||||||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||
|-|-|-|-|
|3.2.1||||
|Ordinary shares||||
|increased by||||
|shareholders||||
|3.2.2 Capital||||
|increased by||||
|holders of other||||
|equity instruments||||
|3.2.3||||
|Share-based||||
|payments included||||
|in owners‘ equity||||
|3.2.4 Other||||
|||-153,27||
|3.3 Profit|46,000,00||-107,276,|
|||6,236.5||
|distribution|0.00||236.56|
|||6||
|3.3.1||||
||46,000,00|-46,000,||
|Appropriation to||||
||0.00|000.00||
|surplus reserves||||
|3.3.2||||
|||-107,27||
|Appropriation to|||-107,276,|
|||6,236.5||
|owners (or|||236.56|
|||6||
|shareholders)||||
|3.3.3 Other||||
|3.4 Transfers||||
|within owners‘||||
|equity||||
|3.4.1 Increase||||
|in capital (or share||||
|capital) from||||
|capital reserves||||
|3.4.2 Increase||||
|in capital (or share||||
|capital) from||||
|surplus reserves||||
|3.4.3 Loss||||
|offset by surplus||||
|reserves||||
|3.4.4 Changes||||
|in defined benefit||||
|pension schemes||||
|transferred to||||
|retained earnings||||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||||
|-|-|-|-|-|-|
|3.4.5 Other||||||
|3.5 Specific||||||
|reserve||||||
|3.5.1 Increase||||||
|in the period||||||
|3.5.2 Used in||||||
|the period||||||
|3.6 Other||||||
|4. Balances as at||||1,920,5||
||595,979,|94,057,85|298,912,7||2,909,538|
|the end of the||||89,031.||
||092.00|9.68|59.52||,743.04|
|period||||84||

III Company Profile
1. Company profile
Shenzhen Properties& Resources Development (Group) Ltd. (hereinafter referred to as―theCompany‖ or―Company‖) was incorporated based on the reconstruction of Shenzhen Properties& Resources Development Co., Ltd. after obtaining approval of ZFBF[1991] No. 831 fromPeople‘s Government of Shenzhen Municipality. The registration number of Business License for Enterprises as Legal Person is ZQFZ No. 440301103570124. And the credibility code for the Company after the business license reform is 91440300192174135N. The registered capital of the Company was RMB541, 799,175 after bonus issue of shares on the basis of one share for every existing 10 shares based on existing paid-in capital of the Company in 1996 and it changes to RMB595,979,092 after bonus issue of shares on the basis of one share for every existing 10 shares based on previous paid-in capital of RMB541,799,175 in 2009. As of 31 December 2018, the total share capital of the Company was 595,979,092 shares, among which, 528,373,849 A shares, and 67,605,243 B shares.
Registered address: 39th and 42nd Floor, International Trade Center, Renmin South Road, Shenzhen.
Registration number of business entity: 91440300192174135N
Legal representative: Liu Shengxiang
2. Nature of the business, business scope and main products of the Company
The nature of business and business scope of the Company and its subsidiaries includes development of real estate and sale of commercial housing, construction and management of buildings, house rent, supervision of construction, domestic trading and materials supply and marketing (excluding exclusive dealing and monopoly sold products and commodities under special control to purchase).
Main products or services rendered mainly include the development and sales of commercial residential housing; property management; buildings and the building devices maintenance, garden afforest and cleaning service; property leasing; supervise and management of the engineering; retails of the Chinese food, Western-style food and wines, and etc.
The parent company of the Company is Shenzhen Investment Holdings Co., Ltd., a solely state-funded limited company. As a government department, Shenzhen State-owned Assets Supervision and Administration Bureau manages Shenzhen Investment Holdings Co., Ltd. on behalf ofPeople‘s Government of Shenzhen Municipality. Thus, the final controller of the Company is Shenzhen State-owned Assets Supervision and Administration Committee of Shenzhen Government.
The financial statements were approved and authorized for issue by Board of the Directors on 29 March 2019. According to the Articles of the Company, the financial statements will be submitted to General Meeting of Shareholders for review.
There were 22 subsidiaries included in the consolidation financial statements in 2018, and for details, please refer to Note VIII―Equities among OtherEntities‖ herein. There was 2 increased subsidiary in the consolidation scope as compared with last year, and
please refer to Notes VII.―Changes in ConsolidationScope‖ for details.
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 IV Basis for Preparation of Financial Statements
1. Preparation Basis
With the going-concern assumption as the basis and based on transactions and other events that actually occurred, the Group prepared financial statements in accordance with The Accounting Standards for BusinessEnterprises—Basic Standard issued by the Ministry of Finance with Decree No. 33 and revised with Decree No. 76, the 42 specific accounting standards, the Application Guidance of Accounting Standards for Business Enterprises, the Interpretation of Accounting Standards for Business Enterprises and other regulations issued and revised from 15 February 2006 onwards (hereinafter jointly referred to as―the Accounting Standards for BusinessEnterprises‖,―China AccountingStandards‖ or―CAS‖), as well as the Rules for Preparation Convention of Disclosure of Public Offering Companies No.15– General Regulations for Financial Reporting (revised in 2014) by China Securities Regulatory Commission.
In accordance with relevant provisions of the Accounting Standards for Business Enterprises, the Group adopted the accrual basis in accounting. Except for some financial instruments, the financial statements were based on historical costs for measurement. If impairment occurred on an asset, an impairment reserve was withdrawn accordingly pursuant to relevant requirements.
2. Continuation
There will be no such events or situations in the 12 months from the end of this Reporting Period that will cause material doubts as to the continuation capability of the Company.
V Important Accounting Policies and Estimations
Is the Company subject to any disclosure requirements for special industries?
Yes
Real estate.
Indication of specific accounting policies and estimations:
The Company and its subsidiaries engage in development of real estate, property leasing, property management, supervision of construction, and catering services. The Company and each subsidiary according to the actual production and operation characteristics and the regulations of the relevant ASBE, formulated certain specific accounting policies and accounting estimates of the transactions and events such as recognizing the revenues, and please refer to the Note IV. 28―Revenue‖ for details. As for the notes to the important accounting judgment and estimations made by the management level, please refer to the Note IV. 33.―Other important accounting policies andestimations‖ of the section.
1. Statement of Compliance with the Accounting Standards for Business Enterprises
The financial statements prepared by the Company are in compliance with in compliance with the Accounting Standards for Business Enterprises, which factually and completely present theCompany‘s, and theCompany‘s financial positions as at 31 December 2018, business results and cash flows for the year of 2018 and other relevant information. In addition, theCompany‘s and theCompany‘s financial statements meet the requirements of disclosing financial statements and notes thereto stated in the Rules for Preparation Convention of Disclosure of Public Offering Companies No.15– General Regulations for Financial Reporting (revised in 2014) by China Securities Regulatory Commission.
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 2. Fiscal Year
TheCompany‘s fiscal periods include fiscal years and fiscal periods shorter than a complete fiscal year. TheCompany‘s fiscal year starts on 1 Jan. and ends on 31 Dec. of every year according to the Gregorian calendar.
3. Operating Cycle
A normal operating cycle refers to a period from the Group purchasing assets for processing to realizing cash or cash equivalents. As for the construction of the real estate projects of the Group with rather long period, the normal operating period more than 1 year owning to the industry characteristics, and although the relevant assets be discounted, sold or consumed more than 1 year, should still be divided into the circulating assets; as for the operating liabilities projects during the normal operation period even be liquidated over 1 year after the balance sheet date, should be divided into the circulation liabilities. Besides, the normal operating period of other business of the Group is shorter than 1 year. As for the normal operating period shorten than 1 year and the assets discounted since the balance sheet date or the liabilities should be liquidated due within 1 year since the balance sheet date, should be classified as the current assets or liabilities.
4. Recording Currency
Renminbi (RMB) is regarded as the prevailing currency used in the main economic circumstances of the Company and its domestic subsidiaries. The Company and its domestic subsidiaries adopt RMB as the recording currency. The Hong Kong subsidiary of the Company confirms the Hong Kong dollar as its recording currency according to the major economic environment of the currency of its office place. When compiling the financial statements, the currency the Company adopted was the Renminbi.
5. Accounting Treatment for Business Combinations under the Common Control and Not under the Common Control
Business combinations, it is refer to two or more separate enterprises merge to form a reporting entity transactions or events. Business combination is divided into under the same control and those non under the same control.
(1) Business combinations under the same control
A business combination under the same control is a business combination in which all of the combining enterprises are ultimately controlled by the same party or the same parties both before and after the business combination and on which the control is not temporary. In a business combination under the same control, the party which obtains control of other combining enterprise(s) on the combining date is the combining party, the other combining enterprise(s) is (are) the combined party. The―combiningdate‖ refers to the date on which the combining party actually obtains control on the combined party.
The assets and liabilities that the combining party obtains in a business combination shall be measured on the basis of their carrying amount in the combined party on the combining date. As for the balance between the carrying amount of the net assets obtained by the combining party and the carrying amount of the consideration paid by it (or the total par value of the shares issued), the additional paid-in capital (share premium) shall be adjusted. If the additional paid-in capital (share premium) is not sufficient to be offset, the retained earnings shall be adjusted.
The direct cost for the business combination of the combining party shall be recorded into the profits and losses at the current period. (2) Business combinations not under the same control
A business combination not under the same control is a business combination in which the combining enterprises are not ultimately controlled by the same party or the same parties both before and after the business combination. In a business combination not under the same control, the party which obtains the control on other combining enterprise(s) on the purchase date is the acquirer, and other
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 combining enterprise(s) is (are) the acquiree.
For a business combination not under the same control, the combination costs shall include the fair values, on the acquisition date, of the assets paid, the liabilities incurred or assumed and the equity securities issued by the acquirer in exchange for the control on the acquiree, the expenses for audit, legal services and assessment, and other administrative expenses, which are recorded into the profits and losses in the current period. The trading expenses for the equity securities or debt securities issued by the acquirer as the combination consideration shall be recorded into the amount of initial measurement of the equity securities or debt securities. The involved contingent consideration shall be recorded into the combination costs at its fair value on the acquiring date. Where new or further evidences emerge, within 12 months since the acquiring date, against the existing circumstances on the acquiring date and the contingent consideration thus needs to be adjusted, the combined goodwill shall be adjusted accordingly. The combination costs of the acquirer and the identifiable net assets obtained by it in the combination shall be measured according to their fair values at the acquiring date. The acquirer shall recognize the positive balance between the combination costs and the fair value of the identifiable net assets it obtains from the acquiree as business reputation. Where the combination costs are less than the fair value of the identifiable net assets it obtains from the acquiree, the acquirer shall re-examine the measurement of the fair values of the identifiable assets, liabilities and contingent liabilities it obtains from the acquiree as well as the combination costs. If, after the reexamination, the combination costs are still less than the fair value of the identifiable net assets it obtains from the acquiree, the acquirer shall record the balance into the profits and losses of the current period.
As for the deductible temporary differences the acquirer obtains from the acquiree which are not recognized into deferred income tax liabilities due to their not meeting the recognition standards, if new or further information shows that the relevant situation has existed on the acquiring date and the economic benefits brought by the deductible temporary differences the acquirer obtains from the acquiree on the acquiring date can be realized, they shall be recognized into deferred income tax assets and the relevant goodwill shall be reduced. Where the goodwill is not sufficient to be offset, the difference shall be recognized into the profits and losses in the current period. In other circumstances than the above, where the deductible temporary differences are recognized into deferred income tax assets on the acquiring date, they shall be recorded into the profits and losses in the current period.
In a business combination not under same control realized by two or more transactions of exchange, according to about the 5th Notice about the Treasury Issuing the Accounting Standards for Enterprises (Finance accounting)[2012] No. 19 Criterion about the―packagedeal‖ (see Notes IV. 5 (2)), Whether the deals are―packagedeal‖ or not, belong to the―packagedeal‖, see the previous paragraphs described in this section and Notes IV. 14―Long term equity investmenttransaction‖ and conduct accounting treatment, those not belong to the "package deal" distinguish between the individual financial statements and the consolidated financial statements and conduct relevant accounting treatment.
In the individual financial statements, the sum of the book value and new investment cost of the Company holds in the acquiree before the acquiring date shall be considered as initial cost of the investment. Other related comprehensive gains in relation to the equity interests that the Company holds in the acquiree before the acquiring date shall be treated on the same basis as the acquiree directly disposes the related assets or liabilities when disposing the investment (that is, except for the corresponding share in the changes in the net liabilities or assets with a defined benefit plan measured at the equity method arising from theacquiree‘s re-measurement, the others shall be transferred into current investment gains).
In theCompany‘s consolidated financial statements, as for the equity interests that the Company holds in the acquiree before the acquiring date, they shall be re-measured according to their fair values at the acquiring date; the positive difference between their fair values and carrying amounts shall be recorded into the investment gains for the period including the acquiring date. Other related comprehensive gains in relation to the equity interests that the Company holds in the acquiree before the acquiring date shall be treated on the same basis as the acquiree directly disposes the related assets or liabilities when disposing the investment (that is, except for the corresponding share in the changes in the net liabilities or assets with a defined benefit plan measured at the equity method arising from theacquiree‘s re-measurement, the others shall be transferred into current investment gains on the acquiring date).
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 6. Preparation of the Consolidated Financial Statements
(1) Principle for determining the consolidation scope
The consolidation scope for financial statements is determined on the basis of control. The term―control‖ is the power of the Company upon an investee, with which it can take part in relevant activities of the investee to obtain variable returns and is able to influence the amount of returns. The consolidated financial statements comprise the financial statements of the Company and its subsidiaries. A subsidiary is an enterprise or entity controlled by the Company.
If any changes in the relevant facts or situations result in any changes in the elements involved in the aforesaid definition of―control‖, the Company shall carry out a reassessment.
(2) Methods for preparing the consolidated financial statements
Subsidiaries are fully consolidated from the date on which the Company obtains control on their net assets and operation decision-making and are de-consolidated from the date when such control ceases. As for a disposed subsidiary, its operating results and cash flows before the disposal date has been appropriately included in the consolidated income statement and cash flow statement; and as for subsidiaries disposed in the current period, the opening items in the consolidated balance sheet are not adjusted. For a subsidiary acquired in a business combination not under the same control, its operating results and cash flows after the acquiring date have been appropriately included in the consolidated income statement and cash flow statement, and the opening items and comparative items in the consolidated financial statements are not adjusted. For a subsidiary acquired in a business combination under the same control or a combined party obtained in a takeover, its operating results and cash flows from the beginning of the Reporting Period of the combination to the combination date have been appropriately included in the consolidated income statement and cash flow statement, and the comparative items in the consolidated financial statements are adjusted at the same time.
The financial statements of subsidiaries are adjusted in accordance with the accounting policies and accounting period of the Company during the preparation of the consolidated financial statements, where the accounting policies and the accounting periods are inconsistent between the Company and subsidiaries. For a subsidiary acquired from a business combination not under the same control, the individual financial statements of the subsidiary are adjusted based on the fair value of the identifiable net assets at the acquisition date.
All significant inter-group balances, transactions and unrealized profits are offset in the consolidated financial statements.
The portion of asubsidiary‘sshareholders‘ equity and the portion of asubsidiary‘s net profits and losses for the period not held by the Company are recognized as minority interests and minority shareholder profits and losses respectively and presented separately undershareholders‘ equity and net profits in the consolidation financial statements. The portion of asubsidiary‘s net profits and losses for the period that belong to minority interests is presented as the item of―minority shareholder profits andlosses‖ under the bigger item of net profits in the consolidated financial statements. Where the loss of a subsidiary shared by minority shareholders exceeds the portion enjoyed by minority shareholders in thesubsidiary‘s openingowners‘ equity, minority interests are offset.
Where the Company losses control on its original subsidiaries due to disposal of some equity investments or other reasons, the residual equity interests are re-measured according to the fair value on the date when such control ceases. The summation of the consideration obtained from the disposal of equity interests and the fair value of the residual equity interests, minus the portion in the originalsubsidiary‘s net assets measured on a continuous basis from the acquisition date that is enjoyable by the Company according to the original shareholding percentage in the subsidiary, is recorded in investment gains for the period when theCompany‘s control on the subsidiary ceases. Other comprehensive incomes in relation to the equity investment in the original subsidiary are treated on the same accounting basis as the acquiree directly disposes the relevant assets or liabilities (that is, except for the changes in the net liabilities or assets with a defined benefit plan resulted from re-measurement of the original subsidiary, the rest shall all be transferred into current investment gains) when such control ceases. And subsequent measurement is conducted on the residual equity interests according to the No. 2 Accounting Standard for Business Enterprises—Long-term Equity Investments or the No. 22 Accounting Standard for BusinessEnterprises—Recognition and Measurement of Financial Instruments. For details, see Notes IV. 14―Long
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Term EquityInvestment‖ or Notes IV. 10―FinancialInstruments‖.
Where the Company losses control on its original subsidiaries due to step by step disposal of equity investments through multiple transactions, it need to distinguish the Group losses control on its subsidiaries due to disposal of equity investments whether belongs to a package deal. All the transaction terms, conditions and economic impact of the disposal ofsubsidiaries‘ equity investment are in accordance with one or more of the following conditions, which usually indicate the multiple transactions, should be considered as a package deal for accounting treatment.① These deals are at the same time or under the condition of considering the influence of each other to concluded;② These transactions only be as a whole can achieve a complete business result;③ The occurrence of a deal depends on at least one othertransactions；④ A deal alone is not economical, it is economical with other trading together. Those not belong to a package deal, each of them a deal depends on circumstances respectively conduct accounting treatment in accordance with the applicable principles of―part disposal of subsidiaries of a long-term equity investment under the condition of not losing control on itssubsidiaries‖ (see Notes IV. 13. (2)④ in this section) and―Where the Company losses control on its original subsidiaries due to disposal of some equity investments or otherreasons‖ (see the front paragraph) relevant transactions of the Company losses control on its subsidiaries due to disposal of equity investments belonging to a package deal, considered as a transaction and conduct accounting treatment. However, Before losing control, every disposal cost and corresponding net assets balance of subsidiary of disposal investment are confirmed as other comprehensive income in consolidated financial statements, which together transferred into the current profits and losses in the loss of control, when the Company losing control on its subsidiary.
7. Classification of Joint Arrangements and Accounting Treatment of Joint Operations
A joint arrangement refers to an arrangement jointly controlled by two participants or above. The Company classifies joint arrangements into joint operations and joint ventures according to its rights and duties in the joint arrangements. A joint operation refers to a joint arrangement where the Group enjoys assets and has to bear liabilities related to the arrangement. A joint venture refers to a joint arrangement where the Group is only entitled to the net assets of the arrangement.
TheCompany‘s investment in the joint venture shall accounted by using the equity method and treated in accordance with relevant accounting policies described in Note IV. 14 (2)②―Long-term equity investments accounted by using the equitymethod‖. In terms of the joint operation involving the Company as a joint operator: recognizes the assets/liabilities held alone and the assets/liabilities jointly held by recognizing according to the portion; recognizes the income from sale of theCompany‘s share in the output of the joint operation; recognizes the income from sale of the jointoperation‘s outputs according to theCompany‘s stake in it; and recognizes the expense solely incurred to the Company and the expense incurred to the joint operation according to theCompany‘s stake in it.
When the Company, as a joint operator, transfers or sells assets (except for the assets constituting business, the same below) to the joint operation, before the assets are sold to a third party, the Company only recognizes the share of the other joint operators in the gains and losses arising from the sale. Where impairment occurs to the assets as prescribed in The Accounting Standard No. 8 for BusinessEnterprises—Asset Impairment, the Company shall fully recognizes the loss resulting from theCompany‘s transfer or sale of the assets in relation to the joint operation; the Company shall recognizes the loss according to its stake in the joint operation for a purchase of assets from the joint operation.
8. Confirmation Standard for Cash and Cash Equivalent
The term―cash‖ refers to cash on hand and deposits that are available for payment at any time. The term―cashequivalents‖ refers to short-term (within 3 months from the purchase date) and highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of change in value.
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 9. Foreign Currency Businesses and Translation of Foreign Currency Financial Statements
(1) Accounting treatments for translation of foreign currency transactions
As for a foreign currency transaction, the Company shall convert the amount in a foreign currency into amount in its bookkeeping base at the spot exchange rate (usually referring to the central parity rate announced by thePeople‘s Bank of China, the same below) of the transaction date, while as for such transactions as foreign exchange or involving in foreign exchange, the Company shall converted into amount in the bookkeeping base currency at actual exchange rate the transaction is occurred.
(2) Accounting treatments for translation of foreign currency monetary items and non-monetary items
On the balance sheet date, the foreign currency monetary items shall be translated at the spot exchange rate on the balance sheet date. The exchange difference arising from it shall be recorded into current profit and loss.
A foreign currency non-monetary item measured at the historical costs shall still be translated at the spot exchange rate on the transaction date. Where the foreign non-monetary items measured at the fair value shall be converted into amount in its bookkeeping base currency at spot exchange rate, the exchange gains and losses arising thereof shall be treated as change in fair value, and recorded into the current period gains and losses or as other comprehensive incomes.
(3) Translation of foreign currency financial statements
When it involves overseas business in preparing the consolidated financial statement, for the translation difference of foreign currency monetary items of net investment in overseas business arising from the change in exchange rate, it shall be recorded into the item of―difference of foreign currency financial statementtranslation‖ under theowners‘ equity; and be recorded into disposal gains and losses at current period when disposing overseas business.
The foreign currency financial statement of overseas business should be translated in to RMB financial statement by the following methods: The asset and liability items in the balance sheets shall be translated at a spot exchange rate on the balance sheet date. Among theowner‘s equity items, except for the items as―undistributedprofits‖, other items shall be translated at the spot exchange rate at the time when they are incurred. The income and expense items in the profit statements shall be translated at the average spot exchange rate at the period-begin and period-end of the transaction date. The undistributed profits at year-begin is the undistributed profits at the end of last year after the translation; undistributed profits at year-end shall be listed as various distribution items after the translation; after the translation, the balance between assets and the sum of liabilities andowners‘ equities shall be recorded into other comprehensive gains and losses as difference of foreign currency translation. Where an enterprise disposes of an overseas business without the control right, it shall shift the differences, which is presented under the items of theowner‘s equities in the balance sheet and which arises from the translation of foreign currency financial statements relating to this overseas business, into the disposal profits and losses of the current period by all or proportion of the disposed overseas business.
Foreign cash flow shall be translated at the average spot exchange rate at the period-begin and period-end of the date of cash flow incurred. The influence of exchange rate on the cash flow shall be adjustment item and individually listed in the cash flow statement. And the beginning balance and the actual balance of last year shall be listed at the amounts after translation of foreign currency financial statement in last year.
Where the control of the Company over an overseas operation ceases due to disposal of all or some of theCompany‘sowner‘s equity in the overseas operation or other reasons, the foreign-currency statement translation difference belonging to the parentcompany‘sowner‘s equity in relation to the overseas operation which is stated in the balance sheet shall be all restated as gains and losses of the disposal period.
Where theCompany‘s equity in an overseas operation decreases due to disposal of some equity investment or other reasons but the Company still has control over the overseas operation, the foreign-currency statement translation difference in relation to the disposed part of the overseas operation shall be recorded into minority interests instead of current gains and losses. Ifwhat‘s disposed is some equity in an overseas associated enterprise or joint venture, the foreign-currency statement translation difference related to the overseas operation shall be recorded into the gains and losses of the current period of the disposal according to the disposal ratio.
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 10. Financial Instruments
The Company recognizes a financial asset or liability when it becomes a party of the relevant financial instrument contract. Financial assets and liabilities are measured at fair value in initial recognition. As for the financial assets and liabilities measured at fair value of which changes are recorded into current gains and losses, the relevant dealing expenses are directly recorded into gains and losses; and the dealing expenses on other kinds of financial assets and liabilities are included in the amounts initially recognized.
(1) Determination of the fair value of main financial assets and financial liabilities
Fair value refers to the price that a market participant shall receive for selling an asset or shall pay for transferring a liability in an orderly transaction on the measurement date. As for the financial assets or financial liabilities for which there is an active market, the quoted prices in the active market shall be used to determine the fair values thereof. The quoted prices in the active market refers to the prices available from stock exchange,broker‘s agencies, guilds, pricing organization and etc., which represent the actual trading price under equal transaction. Where there is no active market for a financial instrument, the enterprise concerned shall adopt value appraisal techniques, including the prices adopted by the parties, who are familiar with the condition, in the latest market transaction upon their own free will, the current fair value obtained by referring to other financial instruments of the same essential nature, the cash flow capitalization method and the option pricing model, etc., to determine its fair value.
(2) Classification, recognition and measurement of financial assets
The purchase and sale of financial assets under the normal ways shall be recognized and stopped to be recognized respectively at the price of transaction date. Financial assets shall be classified into the following four categories when they are initially recognized: (a) the financial assets which are measured at their fair values and the variation of which is recorded into the profits and losses of the current period, (b) the investments which will be held to their maturity; (c) loans and the account receivables; and (d) financial assets available for sale.
① The financial assets which are measured at their fair values and the variation of which is recorded into the profits and losses of the current period
Including transactional financial assets and the financial assets which are designated to be measured at their fair value and of which the variation is recorded into the profits and losses of the current period;
The financial assets meeting any of the following requirements shall be classified as transactional financialassets：A. The purpose to acquire the said financial assets is mainly for selling them in the near future; B. Forming a part of the identifiable combination of financial instruments which are managed in a centralized way and for which there are objective evidences proving that the enterprise may manage the combination by way of short-term profit making in the near future; C. Being a derivative instrument, excluding the designated derivative instruments which are effective hedging instruments, or derivative instruments to financial guarantee contracts, and the derivative instruments which are connected with the equity instrument investments for which there is no quoted price in the active market, whose fair value cannot be reliably measured, and which shall be settled by delivering the said equity instruments. The financial assets meeting any of the following requirements shall be designated as financial assets which are measured at their fair values and the variation of which is recorded into the profits and losses of the current period for initial recognition: A. the designation can eliminate or significantly reduce the difference of relevant gains and losses between recognition and measurement causing from different bases for measurement of financial assets; B. The official written documents for risk management and investment strategies of the enterprise have clearly stated that it shall, manage, evaluate and report to important management personnel based on the fair value, about the group of financial assets which the financial assets are belong to or the financial assets and liabilities group. A financial asset which is measured at their fair values with its variation recorded into the profits and losses of the current period is subsequently measured at the fair value. The gains and losses arising from the fair value changes, as well as the dividend and interest incomes from the financial asset, are recorded in the gains and losses for the current period.
② Held-to-maturity investment
The term "held-to-maturity investment" refers to a non-derivative financial asset with a fixed date of maturity, a fixed or
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 determinable amount of repo price and which the enterprise holds for a definite purpose or the enterprise is able to hold until its maturity.
For the held-to-maturity investment adopting actual interest rate method, which is measured at the post-amortization costs, the profits and losses that arise when such financial assets or financial liabilities are terminated from recognition, or are impaired or amortized, shall be recorded into the profits and losses of the current period.
The actual interest rate method refers to the method by which the post-amortization costs and the interest incomes of different installments or interest expenses are calculated in light of the actual interest rates of the financial assets or financial liabilities (including a set of financial assets or financial liabilities). The actual interest rate refers to the interest rate adopted to cash the future cash flow of a financial asset or financial liability within the predicted term of existence or within a shorter applicable term into the current carrying amount of the financial asset or financial liability.
When the actual interest rate is determined, the future cash flow shall be predicted on the basis of taking into account all the contractual provisions concerning the financial asset or financial liability (the future credit losses shall not be taken into account).and also the various fee charges, trading expenses, premiums or reduced values, etc., which are paid or collected by the parties to a financial asset or financial liability contract and which form a part of the actual interest rate.
③ Loans and the accounts receivables
Loans and the accounts receivables refer to non-derivative financial assets, which there is no quotation in the active market, with fixed recovery cost or recognizable. Financial assets that are defined as loans and the accounts receivables by the Company including notes receivables, accounts receivables, interest receivable, dividends receivable and other receivables etc..
Loans and the accounts receivables are made follow-up measurement on the basis of post-amortization costs employing the effective interest method. Gains or loss arising from the termination recognition, impairment occurs or amortization shall be recorded into the profits and losses of the current period.
④ Assets available for sales
Assets available for sales including non-derivative financial asset that has been assigned as assets available for sales on the initial recognition and financial assets excluded those measured at fair value and of which the variation into profits and losses of the current period, they are some financial assets, loans and accounts receivables, held-to-maturity investment.
The cost at the period-end of the available-for-sale liabilities instruments should be confirmed according to its amortized cost method, that is the initially recognized amount which deduct the principal that had been repaid, to plus or minus the accumulative amortization amount formed by the amortization between the difference of the initially recognized amount and the amount on the due date that adopted the actual interest rate method, and at the same time deduct the amount after the impairment loss happened. The cost at the period-end of the available-for-sale liabilities instruments is its initial cost.
Financial assets available-for-trade are subsequently measured at fair value, and gains or losses arising from changes in the fair value are recognized as other comprehensiveincome，and be carried forward when the said financial assets stopped recognition, then it shall be recorded into the profits and losses of the current period. But, the equity instrument investment which neither have quotation in the active market nor its fair value could not be reliable measured, as well as the derivative financial assets that concern with the equity instruments and should be settled through handing over to its equity instruments, should take the follow-up measurement according to the cost.
Interest receive during the holding of assets available for sales and cash dividends with distribution announcement by invested companies, it shall be recorded into the profits and losses of the current period.
(3) Impairment of financial assets
The Company assesses at the balance sheet date the carrying amount of every financial asset except for the financial assets that measured by the fair value. If there is objective evidence indicating a financial asset may be impaired, a provision is provided for the impairment.
The Company carries out a separate impairment test for every financial asset which is individually significant. As for a financial asset
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 which is individually insignificant, an impairment test is carried out separately or in the financial asset group with similar credit risk. Where the financial asset (individually significant or insignificant) is found not impaired after the separate impairment test, it is included in the financial asset group with similar credit risk and tested again on the group basis. Where the impairment loss is recognized for an individual financial asset, it is not included in the financial asset group with similar credit risk for an impairment test.
① Impairment on held-to maturity investment, loans and receivables
The financial assets measured by cost or amortized cost write down their carrying value by the estimated present value of future cash flow. The difference is recorded as impairment loss. If there is objective evidence to indicate the recovery of value of financial assets after impairment, and it is related with subsequent event after recognition of loss, the impairment loss recorded originally can be reversed. The carrying value of financial assets after impairment loss reversed shall not exceed the amortized cost of the financial assets without provisions of impairment loss on the reserving date.
② Impairment of available-for-sale financial assets
When it judged that the decrease of fair value of the available-for-sale equity instrument investment is serious and not temporarily after comprehensive considering relevant factors, it reflected that the available-for-sale equity instrument investment occurred impairment. Of which, the―seriousdecline‖ refers to the accumulative decline range of the fair value over50%; while the―non-temporarydecline‖ refers to the consecutive decline time of the fair value over 12 months.
Where an available-for-sale financial asset is impaired, the accumulative losses arising from the decrease of the fair value of the capital reserve which is directly included are transferred out and recorded in the profits and losses for the current period. The accumulative losses transferred out are the balance obtained from the initially obtained cost of the said financial asset after deducting the principals as taken back, the amortized amount, the current fair value and the impairment loss originally recorded in the profits and losses.
Where the impairment loss has been recognized for an available-for-sale financial asset, if, within the accounting periods thereafter, there is any objective evidence proving that the value of the said financial asset has been restored and the restoration is objectively related to the events that occur after the impairment loss was recognized, the originally recognized impairment loss is reversed. The impairment losses on the available-for-sale equity instrument investments are reversed and recognized as other comprehensive incomes, and the impairment losses on the available-for-sale liability instruments are reversed and recorded in the profits and losses for the current period.
The impairment loss incurred to an equity instrument investment for which there is no quoted price in the active market and whose fair value cannot be reliably measured, or incurred to a derivative financial asset which is connected with the said equity instrument investment and which must be settled by delivering the said equity investment, is not reversed.
(4) Recognition and measurement of financial asset transfers
Where a financial asset satisfies any of the following requirements, the recognition of it is terminated:① The contractual rights for collecting the cash flow of the said financial asset are terminated;② The said financial asset has been transferred and nearly all of the risks and rewards related to the ownership of the financial asset to the transferee; or③ The said financial asset has been transferred. And the Company has ceased its control on the said financial asset though it neither transfers nor retains nearly all of the risks and rewards related to the ownership of the financial asset.
Where the Company neither transfers nor retains nearly all of the risks and rewards related to the ownership of a financial asset, and it does not cease its control on the said financial asset, it recognizes the relevant financial asset and liability accordingly according to the extent of its continuous involvement in the transferred financial asset. The term "continuous involvement in the transferred financial asset" refers to the risk level that the enterprise faces resulting from the change of the value of the financial asset.
If the transfer of an entire financial asset satisfies the conditions for stopping recognition, the difference between the amounts of the following 2 items is recorded in the profits and losses of the current period: (1) The book value of the transferred financial asset; and (2) The sum of consideration received from the transfer, and the accumulative amount of the changes of the fair value originally
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 recorded in other comprehensive incomes.
If the transfer of partial financial asset satisfies the conditions to stop the recognition, the book value of the transferred financial asset is apportioned between the portion whose recognition has been stopped and the portion whose recognition has not been stopped according to their respective relative fair value, and the difference between the amounts of the following 2 items is included into the profits and losses of the current period: (1) The summation of the consideration received from the transfer and the portion of the accumulative amount of changes in the fair value originally recorded in other comprehensive incomes which corresponds to the portion whose recognition has been stopped; and (2) The amortized carrying amounts of the aforesaid amounts.
In respect of the assets using recourse to sell or using endorsement to transfer, the Company needs to determine whether almost all of the risks and rewards of the financial asset ownership are transferred. If almost all of the risks and rewards of the financial asset ownership had been transferred to the transferee, derecognize the financial assets. For almost all of the risks and rewards of the financial asset ownership retained, do not end to recognize the financial assets. For which neither transfer or retain almost all of the risks and rewards of the financial asset ownership, continuously judge whether the Company retain the control of the assets, and conduct accounting treatment according to the principle of mentioned in the previous paragraphs.
(5) Classification and measurement of financial liabilities
In the initial recognition, financial liabilities are divided into the financial liabilities measured at fair values and whose changes are recorded in current gains and losses and other financial liabilities. Financial liabilities are initially recognized at their fair values. As for a financial liability measured at fair value and whose changes are recorded in current gains and losses, the relevant trading expense is directly recorded in the profits and losses for the current period. As for other financial liabilities, the relevant trading expenses are recorded in the initially recognized amounts.
① Financial liabilities measured at fair values and whose changes are recorded in current gains and losses
Such financial liabilities are divided into transactional financial liabilities and financial liabilities designated to be measured at fair values and whose changes are recorded in current gains and losses in the initial recognition under the same conditions where such financial assets are divided into transactional financial assets and financial assets designated to be measured at fair values and whose changes are recorded in current gains and losses in the initial recognition.
Financial liabilities measured at fair values and whose changes are recorded in current gains and losses are subsequently measured at their fair values. Gains or losses arising from the fair value changes, as well as the dividend and interest expenses in relation to the said financial liabilities, are recorded in the profits and losses for the current period.
② Other financial liabilities
As for a derivative financial liability connected to an equity instrument for which there is not quoted price in an active market and whose fair value cannot be reliably measured and which must be settled by delivering the equity instrument, it is subsequently measured on the basis of costs. Other financial liabilities are subsequently measured according to the amortized cost using the actual interest rate method. Gains or losses arising from de-recognition or amortization of the said financial liabilities is recorded in the profits and losses for the current period.
(6) De-recognition of financial liabilities
Only when the prevailing obligations of a financial liability are relieved in all or in part may the recognition of the financial liability be terminated in all or partly. Where the Company (debtor) enters into an agreement with a creditor so as to substitute the existing financial liabilities by way of any new financial liability, and if the contractual stipulations regarding the new financial liability is substantially different from that regarding the existing financial liability, it terminates the recognition of the existing financial liability, and at the same time recognizes the new financial liability.
Where the recognition of a financial liability is totally or partially terminated, the enterprise concerned shall include into the profits and losses of the current period for the gap between the book value which has been terminated from recognition and the considerations it has paid (including the non-cash assets it has transferred out and the new financial liabilities it has assumed) (7) Offsetting financial assets and financial liabilities
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 When the Company has a legal right that is currently enforceable to set off the recognized financial assets and financial liabilities, and intends either to settle on a net basis, or to realize the financial asset and settle the financial liability simultaneously, a financial asset and a financial liability shall be offset and the net amount is presented in the balance sheet. Except for the above circumstances, financial assets and financial liabilities shall be presented separately in the balance sheet and shall not be offset.
11. Notes and Accounts Receivable
(1) Accounts Receivable with Significant Single Amount for Which the Bad Debt Provision is Made Individually
|||
|-|-|
||Receivables with the amount of more than RMB2 million|
|Judgement basis or monetary standards of provision for bad||
||(including RMB2 million) should recognize as the receivables|
|debts of the individually significant accounts receivable||
||with significant single amount.|
||The Company made an independent impairment test on|
||receivables with significant single amounts; the financial assets|
||without impairment by independent impairment test should be|
|Method of individual provision for bad debts of the individually||
||included in financial assets portfolio with similar credit risk to|
|significant accounts receivable||
||take the impairment test. Receivables was recognized with|
||impairment should no longer be included in receivables portfolio|
||with similar credit risk to take the impairment test.|

(2) Accounts Receivable Which the Bad Debt Provision is Withdrawn by Credit Risk Characteristics
|||
|-|-|
|Name of portfolios|Bad debt provision method|
|Portfolios 1 (accounts receivable among the companies within||
||Other method|
|the consolidated scope of the Group)||
|Portfolios 2 (accounts receivable except for the accounts||
|receivable in the consolidation scope which had not been||
|impaired after the independent test, and the Company analyzed||
|and recognized the ratio of the withdrawal of the bad debt||
|provision combined with the current situation and based on the|Aging analysis method|
|actual losses rate of the accounts receivable group which||
|possessed the similar credit risk characteristics divided according||
|to the aging phase that were the same as or similar to the||
|previous years)||

In the groups, adopting aging analysis method to withdraw bad debt provision:
√ Applicable□ Not applicable
||||
|-|-|-|
||Withdrawal proportion for accounts|Withdrawal proportion for other accounts|
|Age|||
||receivable|receivable|
|Within 1 year (including 1 year)|3.00%|3.00%|
|1-2 years|10.00%|10.00%|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||
|-|-|-|
|2-3 years|30.00%|30.00%|
|3-4 years|50.00%|50.00%|
|4-5 years|80.00%|80.00%|
|Over 5 years|100.00%|100.00%|

 In the groups, adopting balance percentage method to withdraw bad debt provision:
□ Applicable√ Not applicable
In the groups, adopting other methods to withdraw bad debt provision:
√ Applicable□ Not applicable
||||
|-|-|-|
||Withdrawal proportion for accounts|Withdrawal proportion for other accounts|
|Name of portfolios|||
||receivable|receivable|
|Portfolio 1|0.00%|0.00%|

 (3) Accounts Receivable with an Insignificant Single Amount but for which the Bad Debt Provision is Made Independently
|||
|-|-|
||The Group made independent impairment test on receivables|
|Reason of individually withdrawing bad debt provision|with insignificant amount but with special impairment indicated|
||by objective evidence.|
||The Company made independent impairment test on receivables|
||with insignificant amount but with the following characteristics,|
||if any objective evidence shows that the accounts receivable has|
|Withdrawal method for bad debt provision|been impaired, impairment loss shall be recognized on the basis|
||of the gap between the current values of the future cash flow|
||lower than its book value so as to withdraw provision for bad|
||debts|

12. Inventory
Is the Company subject to any disclosure requirements for special industries?
Yes
Real estate industry
(1) Classification
Inventories include raw materials, revolving materials, finished products, stock products, land intended to develop, development products in construction (development costs), completed development products and development products intended to sell but rent temporarily, and etc. the costs of development products include land-transferring fees, expenditures of basic supporting facilities and building installation engineering, borrowing costs incurred before the completion of development project, and other related costs in the process of the development. When the inventories are delivered,it‘s actual costs shall be recognized by specific identification. (2) Valuation method of inventories acquiring and issuing
Inventories shall be priced at actual cost when acquired, and they shall be initially measured at costs. When inventories are delivered,
the materials are priced by weighted average costs, and development products are priced by specific identification.
(3) Basis for determining net realizable value of inventories and provision methods for decline in value of inventories
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Net realizable value is the estimated selling price in the ordinary course of business less the estimated costs of completion, the estimated costs necessary to make the sale and relevant taxes. Net realizable value is determined on the basis of clear evidence obtained, and takes into consideration the purpose of holding inventories and effect of post balance sheet events.
At the balance sheet date, inventories are measured at the lower of the cost and net realizable value. If the net realizable value is below the cost of inventories, a provision for decline in value of inventories is made. The provision for inventories decline in value is determined by the difference of the cost of individual item less its realizable value. For inventory that has large quantity and low unit price, the provision for inventory devaluation is provided for based on categories of the inventory. For inventory related to the products manufactured and sold in the same district, with same or similar use or purpose, and difficult to account for separately from other items, the provision for inventory devaluation is provided for on a consolidated basis.
After the provision for decline in value of inventories is made, if the circumstances that previously caused inventories to be written down below cost no longer exist so that the net realizable value of inventories is higher than their cost, the original provision for decline in value is reversed and the reversal is included in profit or loss for the period.
(4) The perpetual inventory system is maintained for stock system.
(5) Amortization method of the low-value consumption goods and packing articles
(6) Accounting Method Applied to Lands for Development
For pure land development projects, all resulting costs and expenses shall individually constitute the land development costs; For projects linked with the real estate for overall development, when the party supposed to assume all resulting expenses can be defined, such expenses shall be amortized into the commercial housing costs based on the actual area.
(7) Accounting of Costs of Public Facilities
It shall be calculated into the work in progress based on the actual completion cost (if the corresponding public facilities have not been completed when the real estate project is completed, it will be included in the completed development products according to the estimated cost); if a supporting facility can benefit from multiple supporting real estate projects and the developed products are of the same type, it shall be apportioned according to the saleable area; if a supporting facility can benefit from multiple supporting real estate projects and the developed products are not of the same type (for example, common residence and villas are developed at the same time), it shall be apportioned according to the floor space ratio.
(8) Accounting Method of Maintenance Fund
For theCompany‘s property management business, the public maintenance fund received from the owners under theCompany‘s management shall be included in the long-term account payable specially used for the maintenance and renewal of public facilities in the residential common facilities and property management areas.
(9) Accounting Method of Quality Guarantee Deposit
It shall be included in the completed development product costs based on the amount stipulated in the contract, and calculated into the accounts payable for future actual payment after the guarantee period expires.
13. Assets Held for Sale
The Company classifies an asset into held-for-sale when its book value is mainly recovered by selling (including the exchanges of non-monetary assets with commercial substance) instead of a non-current asset or disposal group. Specific standards are simultaneously satisfying the following conditions: A asset or disposal group can be sold immediately under current conditions based on the practice of selling such assets or disposal groups in similar transactions; the Company has already made a resolution on sale plan and obtained a confirmed purchase commitment; and the sale is expected to will be completed within one year. A disposal group refers to a group of assets that are disposed of together as a whole by sale or other means in a transaction and the liabilities directly related to these assets transferred in the transaction. Where the asset group or combination of asset groups to which a disposal group belongs apportions the goodwill acquired in the business combination in accordance with the "Accounting Standards for Enterprises
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 No. 8 - Asset Impairment", the disposal group shall include the goodwill allocated to it.
When the Company initially measures or re-measures on the balance sheet date the non-current assets and disposal groups classified as held-for-sale, If the book value is higher than the fair value minus the net amount of the sale costs, the book value will be written down to the net amount of fair value minus the sale costs, and the amount written down will be recognized as impairment loss of assets and included in the current profit and loss, and provision for impairment of held-for-sale assets will be made at the same time. For the confirmed amount of impairment loss of assets of the disposal groups held for sale, the book value of goodwill of the disposal groups will be offset first, and then the book value of various non-current assets applicable to the measurement of Accounting Standards for Business Enterprises No. 42 - Non-current Assets and Disposal Groups Held for Sale and Termination of Operations (hereinafter referred to as―Held for salestandards‖) in the disposal groups will be offset according to the proportions. If the net amount that the fair value of the disposal groups held for sale on the follow-up balance sheet date minus the sale costs increases, the previous written-down amount will be restored, and reversed to the asset impairment loss confirmed after the assets being classified as held-for-sale. The reversed amount will be included in the current profit or loss. And its book value shall be increased proportionately to the proportion of the book value of various non-current assets measured by the disposal group in addition to goodwill applicable to the measurement of held-for-sale norms; The book value of deducted goodwill and the non-current assets applicable to the measurement of held-for-sale norms will not be reversed if the asset impairment loss is recognized before it is classified as held for sale.
Non-current assets held for sale or non-current assets in the disposal group are not subject to depreciation or amortization. Interest and other expenses of liabilities in the disposal group held for sale will be confirmed as before.
When a non-current asset or disposal group ceases be classified as held-for-sale or a non-current asset is removed out from the held-for-sale disposal group due to failure in meeting the classification conditions for the category of held-for-sale, it will be measured by one of the followings whichever is lower: (1) The book value before being classified as held for sale will be adjusted according to the depreciation, amortization or impairment that would have been recognized under the assumption that it was not classified as held for sale; (2) The recoverable amount.
14. Long-term Equity Investments
The long-term equity investments of this part refer to the long-term equity investments that the Company has control, joint control or significant influence over the investees. The long-term equity investment that the Company does not have control, joint control or significant influence over the investees, should be recognized as available-for-sale financial assets or be measured by fair value with the changes should be included in the financial assets accounting of the current gains and losses, and please refer the details of the accounting policies to Notes IV. 10―Financialinstrument‖
Joint control, refers to the control jointly owned according to the relevant agreement on an arrangement by the Company and the relevant activities of the arrangement should be decided only after the participants which share the control right make consensus. Significant influence refers to the power of the Company which could anticipate in the finance and the operation polices of the investees, but could not control or jointly control the formulation of the policies with the other parties.
(1) Recognition of investment costs
As for long-term equity investments acquired by enterprise merger, if the merger is under the same control, the share of the book value of theowner‘s equity of the merged enterprise, on the date of merger, is regarded as the initial cost of the long-term equity investment. The difference between the initial cost of the long-term equity investment and the payment in cash, non-cash assets transferred as well as the book value of the debts borne by the merging party shall offset against the capital reserve. If the capital reserve is insufficient to dilute, the retained earnings shall be adjusted. If the consideration of the merging enterprise is that it issues equity securities, it shall, on the date of merger, regard the share of the book value of the shareholder's equity of the merged enterprise on the consolidated financial statement of the ultimate control party as the initial cost of the long-term equity investment. The total face value of the stocks issued shall be regarded as the capital stock, while the difference between the initial cost of the
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 long-term equity investment and total face value of the shares issued shall offset against the capital reserve. If the capital reserve is insufficient to dilute, the retained earnings shall be adjusted. The equities of the combined party which respectively acquired through multiple transaction under the same control that ultimately form into the combination of the enterprises under the same control, should be disposed according whether belongs to package deal; if belongs to package deal, each transaction would be executed accounting treatment by the Company as a transaction of acquiring the control right. If not belongs to package deal, it shall, on the date of merger, regard the enjoyed share of the book value of the shareholder's equity of the merged enterprise on the consolidated financial statement of the ultimate control party as the initial cost of the long-term equity investment, and as for the difference between the initial investment cost of the long-term equity investment and sum of the book value of the long-term equity investment before the combination and the book value of the consideration of the new payment that further required on the combination date, should adjust the capital reserve; if the capital reserve is insufficient to dilute, the retained earnings shall be adjusted. The equity investment held before the combination date which adopted the equity method for accounting, or the other comprehensive income confirmed for the available-for-sale financial assets, should not have any accounting disposal for the moment.
For the long-term investment required from the business combination under different control, the initial investment cost regarded as long-term equity investment on the purchasing date according to the combination cost, the combination costs shall be the sum of the fair values of the assets paid, the liabilities incurred or assumed and the equity securities issued by the Company. The equities of the acquirees which respectively acquired through multiple transaction that ultimately form into the combination of the enterprises under the different control, should be disposed according whether belongs to package deal; if belongs to package deal, each transaction would be executed accounting treatment by the Company as a transaction of acquiring the control right. If not belongs to package deal, the sum of the book value of the original held equity investment of the acquirees and the newly added investment cost should be regarded as the initial investment cost of the long-term equity investment that changed to be accounted by cost method. If the original held equity is calculated by cost method, the other relevant comprehensive income would not have any accounting disposal for the moment. If the original held equity investment is the financial assets available for sale, its difference between the fair value and the book value as well as the accumulative changes of the fair value that include in the other comprehensive income, should transfer into the current gains and losses.
The commission fees for audit, law services, assessment and consultancy services and other relevant expenses occurred in the business combination by the combining party or the purchase party, shall be recorded into current profits and losses upon their occurrence.
Besides the long-term equity investments formed by business combination, the other long-term equity investments shall be initially measured by cost, the cost is fixed in accordance with the ways of gaining, such as actual cash payment paid by the Company, the fair value of equity securities issued by the Company, the agreed value of the investment contract or agreement, the fair value or original carrying amount of exchanged assets from non-monetary assets exchange transaction, the fair value of the long-term equity investments, etc. The expenses, taxes and other necessary expenditures directly related with gaining the long-term equity investments shall also be recorded into investment cost. The long-term equity investment cost for those could execute significant influences on the investees because of appending the investment or could execute joint control but not form as control, should be as the sum of the fair value of the original held equity investment and the newly added investment cost recognized according to the No. 22 of Accounting Standards for BusinessEnterprises—Recognition and Measurement of Financial Instrument.
(2) Subsequent measurement and recognition of gains or losses
A long-term equity investment where the investing enterprise has joint control (except for which forms into common operators) or significant influence over the investors should be measured by equity method. Moreover, long-term equity investment adopting the cost method in the financial statements, and which the Company has control on invested entity.
① Long-term equity investment measured by adopting cost method
The price of a long-term equity investment measured by adopting the cost method shall be included at its initial investment cost and append as well as withdraw the cost of investing and adjusting the long-term equity investment. The return on investment at current
period shall be recognized in accordance with the cash dividend or profit announced to distribute by the invested entity, except the
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 announced but not distributed cash dividend or profit included in the actual payment or consideration upon gaining the investment.② Long-term equity investment measured by adopting equity method
If the initial cost of a long-term equity investment is more than the Company's attributable share of the fair value of the invested entity's identifiable net assets for investment, the initial cost of the long-term equity investment may not be adjusted. If the initial cost of a long-term equity investment is less than the Company's attributable share of the fair value of the invested entity's identifiable net assets for the investment, the difference shall be included in the current profits and losses and the cost of the long-term equity investment shall be adjusted simultaneously.
When measured by adopting equity method, respectively recognize investment income and other comprehensive income according to the net gains and losses as well as the portion of other comprehensive income which should be enjoyed or be shared, and at the same time adjust the book value of the long-term equity investment; corresponding reduce the book value of the long-term equity investment according to profits which be declared to distribute by the investees or the portion of the calculation of cash dividends which should be enjoyed; for the other changes except for the net gains and losses, other comprehensive income and theowners‘ equity except for the profits distribution of the investees, should adjust the book value of the long-term equity investment as well as include in the capital reserve. The investing enterprise shall, on the ground of the fair value of all identifiable assets of the invested entity when it obtains the investment, recognize the attributable share of the net profits and losses of the invested entity after it adjusts the net profits of the invested entity. If the accounting policy adopted by the investees is not accord with that of the Company, should be adjusted according to the accounting policies of the Company and the financial statement of the investees during the accounting period and according which to recognize the investment income as well as other comprehensive income. For the transaction happened between the Company and associated enterprises as well as joint ventures, if the assets launched or sold not form into business, the portion of the unrealized gains and losses of the internal transaction, which belongs to the Company according to the calculation of the enjoyed proportion, should recognize the investment gains and losses on the basis. But the losses of the unrealized internal transaction happened between the Company and the investees which belongs to the impairment losses of the transferred assets, should not be neutralized. The assets launched by the Company to the associated enterprises or the joint ventures if could form into business, the long-term equity investment without control right which acquired by the investors, should regard the fair value of the launched business as the initial investment cost the newly added long-term equity investment, and for the difference between the initial investment cost and the book value of the launched business, should be included into the current gains and losses with full amount. The assets sold by the Company to the associated enterprises or the joint ventures if could form into business, the difference between the acquired consideration and the book value of the business should be included in the current gains and losses with full amount. The assets purchased by the Company to the associated enterprises or the joint ventures if could form into business, should be accounting disposed according to the regulations of No. 20 ofASBE—Business Combination, and should be recognized gains or losses related to the transaction with full amount.
The Company shall recognize the net losses of the invested enterprise until the book value of the long-term equity investment and other long-term rights and interests which substantially form the net investment made to the invested entity are reduced to zero. However, if the Company has the obligation to undertake extra losses, it shall be recognized as the estimated liabilities in accordance with the estimated duties and then recorded into investment losses at current period. If the invested entity realizes any net profits later, the Company shall, after the amount of its attributable share of profits offsets against its attributable share of the un-recognized losses, resume recognizing its attributable share of profits.
For the long-term equity investment held by the Company before the first execution of the new accounting criterion of the associated enterprises and joint ventures, if there is debit difference of the equity investment related to the investment, should be included in the current gains and losses according to the amount of the straight-line amortization during the original remained period.
③ Acquiring shares of minority interest
In the preparation for the financial statements, the balance existed between the long-term equity investment increased by acquiring shares of minority interest and the attributable net assets on the subsidiary calculated by the increased shares held since the purchase
date (or combination date), the capital reserves shall be adjusted, if the capital reserves are not sufficient to offset, the retained profits
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 shall be adjusted.
④ Disposal of long-term equity investment
In the preparation of financial statements, the Company disposed part of the long-term equity investment on subsidiaries without losing its controlling right on them, the balance between the disposed price and attributable net assets of subsidiaries by disposing the long-term equity investment shall be recorded intoowners‘ equity; where the Company losses the controlling right by disposing part of long-term equity investment on such subsidiaries, it shall treated in accordance with the relevant accounting policies in Notes IV. 5. (2)―Method on preparation of combined financialstatements‖.
For other ways on disposal of long-term equity investment, the balance between the book value of the disposed equity and its actual payment gained shall be recorded into current profits and losses.
For the long-term equity investment measured by adopting equity method, if the remained equity after disposal still adopts the equity method for measurement, the other comprehensive income originally recorded intoowners‘ equity should adopt the same basis of the accounting disposal of the relevant assets or liabilities directly disposed by the investees according to the corresponding proportion. Theowners‘ equity recognized owning to the changes of the otherowners‘ equity except for the net gains and losses, other comprehensive income and the profits distribution of the investees, should be transferred into the current gains and losses according to the proportion.
For the long-term equity investment which adopts the cost method of measurement, if the remained equity still adopt the cost method, the other comprehensive income recognized owning to adopting the equity method for measurement or the recognition and measurement standards of financial instrument before acquiring the control of the investees, should adopt the same basis of the accounting disposal of the relevant assets or liabilities directly disposed by the investees and should be carried forward into the current gains and losses according to the proportion; the changes of the otherowners‘ equity except for the net gains and losses, other comprehensive income and the profits distribution among the net assets of the investees which recognized by adopting the equity method for measurement, should be carried forward into the current gains and losses according to the proportion.
If the Company loses control over the investee due to disposal of partial equity investment, in the preparation of individual financial statements, if the remaining equity after such disposal can be applied to exercise joint control or exert significant influence on the investee, it shall be calculated by using the equity method. The remaining equity shall be deemed to be adjusted by equity method when it is acquired; if the remaining equity after disposal cannot be applied to exercise joint control over or exert significant influence on the investee, it shall be calculated according to various provisions related to financial instrument recognition and measurement criteria. The difference between the fair value and the book value on the date of loss of control is recognized in profit or loss for the period. Before the Company obtains control over the investee, other comprehensive incomes recognized and calculated by using the equity method or according to the financial instrument recognition and measurement criteria shall be subject to the accounting treatment by adopting the same accounting basis with that applied by the investee to directly dispose relevant assets or liabilities when the control over the investee is lost. The changes in theowner‘s equity other than the net profit or loss, other comprehensive income and profit distribution in the net assets of the investee recognized by using the equity method shall be carried forward into the current profit or loss. Where the remaining equity after disposal is calculated by using the equity method, other comprehensive incomes and otherowner‘s equities shall be carried forward on a pro-rata basis; if the remaining equity after disposal adopts corresponding accounting treatment based on the financial instrument recognition and measurement criteria, other comprehensive incomes and otherowner‘s equities shall be carried forward.
If the Company loses its joint control over or significant influence on the investee due to the disposal of partial equity investment, the remaining equity after disposal shall be subject to the financial instrument recognition and measurement criteria for accounting, and the difference between the fair value and the book value on the day of loss of joint control or significant influence shall be included in the current profit and loss. In the original equity investment, other comprehensive incomes recognized by using the equity method shall be subject to the accounting treatment on the same basis with that applied by the investee to directly dispose related assets or liabilities when the equity method is discontinued for accounting. Theowner‘s equity recognized due to the changes of otherowner‘s
equities of the investee other than the net profit or loss, other comprehensive incomes and profit distribution shall be all carried
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 forward to the current income on investment when the equity method is discontinued for accounting.
If the Company disposes the equity investment in the subsidiaries step by step by means of multiple transactions till the loss of control, and such transactions are part of the package transaction, such transactions shall be treated as a transaction in relation to the equity investment of the subsidiary with the lost control right. The difference between the disposal price and the book value of the long-term equity investment corresponding to the disposed equity before the loss of control shall be firstly recognized as other comprehensive incomes, and then carried forward to the current profit or loss when the control is lost.
15. Investment Real Estate
Measurement model of investment real estate
Costing method measurement
Depreciation or amortization method
The investment real estate refers to the real estate gaining the rent or capital appreciation or both. It includes rented land use right, holding land use right to be transferred after the appreciation and rented building, etc.
The investment real estate is measured initially according to the cost. The subsequent expenses related with the investment real estate shall be calculated into the cost of investment real estate if the economic benefit related with the asset may flow in and the cost may be measured reliably. Other subsequent expenses shall be calculated in the current profits and losses at the occurrence.
The Company adopts the cost mode to conduct the subsequent measurement on the investment real estate, depreciates or amortizes according to the policy consistent with the house building or land use right.
The devaluation test method and devaluation provision method for the investment real estate can be seen in Notes IV. 22―Long-term AssetDevaluation‖.
When the self-use real estate or stock is converted to the investment real estate or the investment real estate is converted to the self-use real estate, the book value before the conversion shall be the entry value after the conversion.
When the purpose of investment real estate is changed into private use, the investment real estate shall be converted into the fixed assets or intangible assets from the date of change. When the purpose of the self-use real estate is changed for earning rents or for capital appreciation, the fixed assets or intangible assets shall be converted into the investment real estate from the date of change. If it is converted to the investment real estate measured by the cost model, the book value before such conversion shall be used as the entry value after such conversion; if it is converted into the investment real estate measured by the fair value model, the fair value on the conversion date shall be used as the entry value after such conversion.
When the investment real estate is disposed, or out of usage permanently, and it is expected not to get the economic benefit from the disposal, the confirmation on the investment real estate shall be terminated. The disposal income for the sales, transferring, scrap or damage of the investment real estate deducing the book value and related tax shall be calculated in the current profits and losses. 16. Fixed Assets
(1) Conditions for Recognition
The term―fixedassets‖ refers to the tangible assets that simultaneously possess the features as follows: (a) they are held for the sake of producing commodities, rendering labor service, renting or business management; and (b) their useful life is in excess of one fiscal year. The fixed assets are only recognized when the relevant economic benefits probably flow in the Company and its cost could be reliable measured. The fixed assets should take the initial measurement according to the cost and at the same time consider the influences of the factors of the estimated discard expenses.
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 (2) Depreciation Methods
||||||
|-|-|-|-|-|
|Category of fixed assets|Method|Useful life|Salvage value|Annual deprecation|
||Average method of||||
|Housing and building||20-25|5-10%|3.8-4.5|
||useful life||||
||Average method of||||
|Transportation vehicle||5|5%|19|
||useful life||||
|Electronic equipments|Average method of||||
|||5|5%|19|
|and others|useful life||||
|Decoration of fixed|Average method of||||
|||5|0%|20|
|assets|useful life||||

The estimated net salvage refers to the amount obtained by the Company from its disposal of the assets by deducting the estimated disposal expenses based on the assumption that the fixedassets‘ estimated service life expires and reaches the predicted status when its service life expires.
The fixed assets impairment test methods and the impairment provision calculating and withdrawing method
Please refer to Note IV. 22―Long-term AssetsImpairment‖ for the fixed assets impairment test methods and the impairment provision calculating and withdrawing method.
Subsequent expenses related to the fixed assets, if the economic benefits related to the fixed assets are likely to flow in and their costs can be reliably measured, are included in the cost of fixed assets and the carrying amount of the replaced portion is derecognized. Other subsequent expenditures other than that shall be recognized in the current profit or loss.
The fixed asset shall be derecognized when the fixed asset is in disposal or is expected not to generate economic benefits through use or disposal. The difference between the disposal income from the sale, transfer, retirement or damage of the fixed assets less the carrying amount and related taxes is recognized in profit or loss for the current period.
The Company shall review the useful life, estimated net residual value and depreciation method of the fixed assets at least at the end of the year, and if there is any change, it shall be treated as the changes in accounting estimations.
(3) Recognition Basis, Pricing and Depreciation Method of Fixed Assets by Finance Lease
The―financelease‖ shall refer to a lease that has transferred in substance all the risks and rewards related to the ownership of an asset. Its ownership may or may not eventually be transferred. The fixed assets by finance lease shall adopt the same depreciation policy for self-owned fixed assets. If it is reasonable to be certain that the lessee will obtain the ownership of the leased asset when the lease term expires, the leased asset shall be fully depreciated over its useful life. If it is not reasonable to be certain that the lessee will obtain the ownership of the leased asset at the expiry of the lease term, the leased asset shall be fully depreciated over the shorter one of the lease term or its useful life.
17. Construction in Progress
Is the Company subject to any disclosure requirements for special industries?
Yes
Real estate industry
Construction in process is measured at actual cost. Actual cost comprises construction costs, borrowing costs that are eligible for
capitalization before the fixed assets being ready for their intended us and other relevant costs. Construction in process is transferred
to fixed assets when the assets are ready for their intended use.
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 See the details of the impairment test method of the impairment provision withdrawal method of the construction in progress to Note IV. 22―Long-term assetsimpairment‖.
18. Borrowing Costs
Borrowing costs include interest on borrowings, amortization of discounts or premiums, ancillary expenses and exchange differences arising from foreign currency borrowings. The capitalization of borrowing costs, which can be directly attributable to asset acquisition or construction, starts when asset expenditure or borrowing cost are generated, or the asset acquisition or construction is launched to enable the asset to meet the predefined conditions for use or sale, and ends when the acquired or constructed asset conforming to capitalization conditions meet the predefined conditions for use or sale. The other borrowing costs are recognized as expenses in the current period.
The actual interest expenses incurred in the current period of specific borrowings shall be capitalized by subtracting the interest income earned by the bank from unused borrowing funds or investment income gained from temporary investment. For general borrowings, the amount to be capitalized shall be determined based on the weighted average of total asset expenditure exceeding the specific borrowing multiplied by the capitalization rate of general borrowings. The capitalization rate is determined based on the weighted average interest rate of general borrowings.
During the capitalization period, the foreign exchange differences on foreign currency specific borrowings shall be capitalized. The exchange differences on foreign currency general borrowings shall be included in the current profits and losses.
Assets eligible for capitalization refer to assets such as fixed assets, investment real estate and inventory that require a considerable amount of time for acquisition or construction to be ready for use or sale.
If the acquisition or construction process of the assets eligible for capitalization is stopped unexpectedly for more than 3 months, the capitalization of borrowing costs shall be suspended until the asset acquisition or construction resumes.
19. Biological Assets
Not applicable
20. Oil-gas Assets
Not applicable
21. Intangible Assets
(1) Pricing Method, Useful Life and Impairment Test
The term―intangibleasset‖ refers to the identifiable non-monetary assets possessed or controlled by enterprises which have no physical shape.
The intangible assets shall be initially measured according to its cost. The costs related with the intangible assets, if the economic benefits related to intangible assets are likely to flow into the enterprise and the cost of intangible assets can be measured reliably, shall be recorded into the costs of intangible assets; otherwise, it shall be recorded into current profits and losses upon the occurrence. The use right of land gained is usually measured as intangible assets. For the self-developed and constructed factories and other constructions, the related expenditures on use right of land and construction costs shall be respectively measured as intangible assets and fixed assets. For the purchased houses and buildings, the related payment shall be distributed into the payment for use right of land and the payment for buildings, if it is difficult to be distributed, the whole payment shall be treated as fixed assets.
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 For intangible assets with a finite service life, from the time when it is available for use, the original vaue shall be amortized by straight line method during the service life. While the intangible assets without certain service life shall not be amortized.
At the end of period, the Company shall check the service life and amortization method of intangible assets with finite service life, if there is any change, it shall be regarded as a change of the accounting estimates. Besides, the Company shall check the service life of intangible assets without certain service life, if there is any evidence showing that the period of intangible assets to bring the economic benefits to the enterprise can be prospected, it shall be estimated the service life and amortized in accordance with the amortization policies for intangible assets with finite service life.
(2) Accounting Policy for Internal Research and Development Expenditures
Not applicable
22. Impairment of Long-term Assets
For non-current financial Assets of fixed Assets, projects under construction, intangible Assets with limited service life, investing real estate with cost model, long-term equity investment of subsidiaries, cooperative enterprises and joint ventures, the Company should judge whether decrease in value exists on the date of balance sheet. Recoverable amounts should be tested for decrease in value if it exists. Other intangible Assets of reputation and uncertain service life and other non-accessible intangible assets should be tested for decrease in value no matter whether it exists.
If the recoverable amount is less than book value in impairment test results, the provision for impairment of differences should include in impairment loss. Recoverable amounts would be the higher of net value of asset fair value deducting disposal charges or present value of predicted cash flow. Asset fair value should be determined according to negotiated sales price of fair trade. If no sales agreement exists but with asset active market, fair value should be determined according to theBuyer‘s price of the asset. If no sales agreement or asset active market exists, asset fair value could be acquired on the basis of best information available. Disposal expenses include legal fees, taxes, cartage or other direct expenses of merchantable Assets related to asset disposal. Present value of predicted asset cash flow should be determined by the proper discount rate according to Assets in service and predicted cash flow of final disposal. Asset depreciation reserves should be calculated on the basis of single Assets. If it is difficult to predict the recoverable amounts for single Assets, recoverable amounts should be determined according to the belonging asset group. Asset group is the minimum asset combination producing cash flow independently.
In impairment test, book value of the business reputation in financial report should be shared to beneficial asset group and asset group combination in collaboration of business merger. It is shown in the test that if recoverable amounts of shared business reputation asset group or asset group combination are lower than book value, it should determine the impairment loss. Impairment loss amount should firstly be deducted and shared to the book value of business reputation of asset group or asset group combination, then deduct book value of all assets according to proportions of other book value of above assets in asset group or asset group combination except business reputation.
After the asset impairment loss is determined, recoverable value amounts would not be returned in future.
23. Long-term Deferred Expenses
Long-term deferred expenses refer to general expenses with the apportioned period over one year (one year excluded) that have occurred but attributable to the current and future periods. And the long-term deferred expense shall be amortized by the straight-line method averagely within the benefit period.
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 24. Payroll
(1) Accounting Treatment of Short-term Compensation
The payroll of the Company mainly includes Short-term Compensation, Welfare after Departure, Demission Welfare, and the Welfare of Other Long-term Staff. Among which:
Short-term compensation mainly including salary, bonus, allowances and subsidies, employee services and benefits, medical insurance premiums, birth insurance premium, industrial injury insurance premium, housing fund, labor union expenditure and personnel education fund, non-monetary benefits etc. The short-term compensation actually happened during the accounting period when the active staff offering the service for the Company should be recognized as liabilities and is included in the current gains and losses or relevant assets cost. Of which the non-monetary benefits should be measured according to the fair value.
(2) Accounting Treatment of the Welfare after Departure
Welfare after demission mainly includes basic endowment insurance and unemployment insurance and annuity, and welfare plans after demission include setting drawing plan. Where the setting drawing plan is adopted, the corresponding payable and deposit amount should be included into the relevant assets cost or the current gains and losses when happen. The Company relieves the labor relation with the employees before the due date of the labor contacts or puts forward the advice of providing the compensation for urging the employees volunteered to receive the downsizing and when the Company could not unilaterally withdraw the demission welfare owning to the relieving plan of the labor relation or the downsizing advice, should confirm the liabilities of theemployees‘ salary from the demission welfare on the earlier day between the cost confirmed by the Company and the cost related to the reorganization of the payment of the demission welfare and includes which in the current gains and losses. But as for the demission welfare be estimated that could not be completed paid within 12 months after the end of the annual Reporting Period, should be handled according to the other long-termemployee‘s salary.
(3) Accounting Treatment of the Demission Welfare
The internal retire plan of the employees should be handled by adopting the same principles of the above demission welfare. The Company includes the salary and the paid social insurance charges planed to pay by the personnel retreated inside during the period from the date when ceased the services to the normal retire date in the current gains and losses (demission welfare) when met with the recognition conditions of the estimated liabilities.
(4) Accounting Treatment of the Welfare of Other Long-term Staffs
The other long-term welfare that the Company offers to the staffs, if met with the setting drawing plan, should be accounting disposed according to the setting drawing plan, while the rest should be disposed according to the setting revenue plan.
25. Estimated Liabilities
The obligation pertinent to contingencies shall be recognized as an estimated debts when the following conditions are satisfied simultaneously:① That obligation is a current obligation of the enterprise;② It is likely to cause any economic benefit to flow out of the enterprise as a result of performance of the obligation; and③ The amount of the obligation can be measured in a reliable way On balance sheet date, given the risks, uncertainty, the time value of money, and other factors pertinent to the contingencies, the estimated debts shall be measured in accordance with the best estimate of the necessary expenses for the performance of the current obligation.
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 When all or some of the expenses necessary for the liquidation of an estimated debts of an enterprise is expected to be compensated by a third party, the compensation should be separately recognized as an asset only when it is virtually certain that the reimbursement will be obtained. The amount of compensation is not exceeding the book value of the recognized estimated liabilities.
26. Share-based Payment
Not applicable
27. Other Financial Instruments such as Preferred Shares and Perpetual Capital Securities
Not applicable
28. Revenue
Is the Company subject to any disclosure requirements for special industries?
Yes
Real estate industry
The revenue of the Group including the commodities sales revenue, real estate sales revenues, property leasing revenues, labor revenues and the revenues from the using of the assets of the Company by others.
(1) Selling products
No revenue from selling goods may be recognized unless the following conditions are met simultaneously: the significant risks and rewards of ownership of the goods have been transferred to the buyer by the enterprise; the enterprise retains neither continuous management right that usually keeps relation with the ownership nor effective control over the sold goods; the relevant amount of revenue can be measured in a reliable way; the relevant economic benefits may flow into the enterprise; and the relevant costs incurred or to be incurred can be measured in a reliable way.
The revenues of the sales of the commodities of the Group were mainly the sales revenues of the commercial residential buildings. The sales of the properties of the Group had executed completion acceptance that had transferred to the buyers or be regarded as had transferred to the buyers according to the sales contacts as well as confirmed the realization of the revenues when executing the liquidation of the sales amount of the commercial residential buildings (the mortgage purchase way of the buildings were the receipted down payment and the bank mortgage amount).
(2) Provide labor income
The labor income provided by the Group mainly comes from property management income, project supervision service income and catering service income.
Property management income: the property management income is realized when the property management service has been provided and the service fee as agreed with the owner is able to flow into the enterprise.
Other labor income: the labor income is realized when the labor service has been provided and the related economic interest is able to flow into the enterprise and related cost is able to be reliably measured.
The outcome of a transaction concerning the providing of labor services can be measured in a reliable way, means that the following conditions shall be met simultaneously:① The amount of revenue can be measured in a reliable way;② The relevant economic benefits are likely to flow into the enterprise;③The costs incurred or to be incurred in the transaction can be measured in a reliable way.
If the outcome of a transaction concerning the providing of labor servicescan‘t be measured in a reliable way, the revenue from the providing of labor services shall be recognized in accordance with the amount of the cost of labor services incurred and expected to be compensated, and make the cost of labor services incurred as the current expenses. If it is predicted that the cost of labor services
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 incurredcouldn‘t be compensated, thus no revenue shall be recognized.
Where a contract or agreement signed between Company and other enterprises concerns selling goods and providing of labor services, if the part of sale of goods and the part of providing labor services can be distinguished from each other and can be measured respectively, the part of sale of goods and the part of providing labor services shall be treated respectively. If the part of selling goods and the part of providing labor servicescan‘t be distinguished from each other, or if the part of sale of goods and the part of providing labor services can be distinguished from each other butcan‘t be measured respectively, both parts shall be conducted as selling goods.
(3) Income from transferring asset use right
The income from transferring asset use right includes property lease income, and other use right income.
Property lease income: the property lease income is realized by the method of straight line as agreed in the lease contract or agreement signed with the leasee. If there are lease periods free of any rent, the lessor shall distribute the total rent, not deducting the rent during those periods free of any rent, within the entire lease period by the method of straight line or other reasonable means. During the periods free of any rent, the lessor shall recognize the lease income.
Income from other use right: the income from transferring asset use right is recognized when the income amount is able to be reliably measured and related economic interest is possible to flow into the enterprise.
(4) Interest income
The interest income is recognized by the duration you use theCompany‘s monetary capital and the actual interest rate.
29. Government Subsidies
The government subsidy refers to the Company gets the monetary and non-monetary assets for free from the government, excluding the capital that the government invests as the investor who enjoys the correspondingowner‘s equity. It can be divided into the asset-related government subsidy and income-related government subsidy. The government subsidies pertinent to assets mean the government assets that are obtained by enterprises used for purchase or construction, or forming the long-term assets by other ways. The government subsidies pertinent to income refer to all the government subsides except those pertinent to assets. If the government subsidies documents had not definitely confirm the subsidy targets, based on the basic requirements necessary for the subsidies, the government subsidies based on long-term assets formed through purchase and construction and other methods are regarded as government subsidies related to assets. Beyond that, the rest are divided as the government subsidies related to income. If monetary grants are received, it recognized at actual received or receivable amount. If non-monetary grants are received, it recognized at fair value, replacing with nominal amount while fair value is not reliable. Government subsidies measured at nominal amount are directly recorded into the current profit and loss.
The asset-related government subsidy shall be confirmed as the deferred income, and it shall be calculated into the current profits and losses by stages in reasonable and systematic way within the service life of related asset. The income-related government subsidy to compensate the related expense and loss later shall be confirmed as the deferred income, and it shall be calculated in the current profits and losses during the period to confirm the related costs or losses; the occurred related costs or losses for compensation shall be calculated in the current profits and losses directly.
For government subsidy including the asset-related government subsidy and the income-related government subsidy at one time, accounting treatment shall be conducted respectively to distinguish the different parts; if it is difficult to distinguish, then it shall be classified into the income-related government subsidy
Government subsidies related to routine activities of the Company shall be calculated into other income according to the essence of economic business; government subsidies that have nothing to do with routine activities shall calculated into non-operating income. 30. Deferred Income Tax Assets/Deferred Income Tax Liabilities
(1) Income tax of the current period
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 On the balance sheet date, for the current income tax liabilities (or assets) of the current period as well as the part formed during the previous period, should be measured by the income tax of the estimated payable (returnable) amount which be calculated according to the regulations of the tax law. The amount of the income tax payable which is based by the calculation of the current income tax expenses, are according to the result measured from the corresponding adjustment of the pre-tax accounting profit of this year which in accord to the relevant regulations of the tax law.
(2) Deferred income tax assets and deferred income tax liabilities
The difference between the book value of certain assets and liabilities and their tax assessment basis, as well as the temporary difference occurs from the difference between the book value of the items which not be recognized as assets and liabilities but could confirm their tax assessment basis according to the regulations of the tax law, the deferred income tax assets and the deferred income tax liabilities should be recognized by adopting liabilities law of the balance sheet.
No deferred tax liability is recognized for a temporary difference arising from the initial recognition of goodwill, the initial recognition of assets or liabilities due to a transaction other than a business combination, which affects neither accounting profit nor taxable profit (or deductible loss). Besides, no deferred tax assets is recognized for the taxable temporary differences related to the investments of subsidiary companies, associated enterprises and joint enterprises, and the investing enterprise can control the time of the reverse of temporary differences as well as the temporary differences are unlikely to be reversed in the excepted future. Otherwise, the Group should recognize the deferred income tax liabilities arising form other taxable temporary difference.
No deferred taxable assets should be recognized for the deductible temporary difference of initial recognition of assets and liabilities arising from the transaction which is not business combination, the accounting profits will not be affected, nor will the taxable amount or deductible loss be affected at the time of transaction. Besides, no deferred taxable assets should be recognized for the deductible temporary difference related to the investments of the subsidiary companies, associated enterprises and joint enterprises, which are not likely to be reversed in the expected future or is not likely to acquire any amount of taxable income tax that may be used for making up such deductible temporary differences. Otherwise, the Company shall recognize the deferred income tax assets arising from a deductible temporary difference basing on the extent of the amount of the taxable income that is likely to be acquired to make up such deductible temporary differences
For any deductible loss or tax deduction that can be carried forward to the next year, the corresponding deferred income tax asset shall be determined to the extent that the amount of future taxable income to be offset by the deductible loss or tax deduction to be likely obtained.
On the balance sheet date, the deferred income tax assets and the deferred income tax liabilities shall be measured at the tax rate applicable to the period during which the assets are expected to be recovered or the liabilities are expected to be settled.
The book value of deferred income tax assets shall be reviewed at each balance sheet date. If it is unlikely to obtain sufficient taxable income to offset against the benefit of the deferred income tax asset, the book value of the deferred income tax assets shall be written down. Any such write-down should be subsequently reversed where it becomes probable that sufficient taxable income will be available.
(3) Income tax expenses
Income tax expenses include current income tax and deferred income tax.
The rest current income tax and the deferred income tax expenses or revenue should be included into current gains and losses except for the current income tax and the deferred income tax related to the transaction and events that be confirmed as other comprehensive income or be directly included in theshareholders‘ equity which should be included in other comprehensive income orshareholders‘ equity as well as the book value for adjusting the goodwill of the deferred income tax occurs from the business combination. (4) Offset of income tax
The current income tax assets and liabilities of the Company should be listed by the written-off net amount which intend to executes the net amount settlement as well as the assets acquiring and liabilities liquidation at the same time while owns the legal rights of settling the net amount.
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 The deferred income tax assets and liabilities of the Company should be listed as written-off net amount when having the legal rights of settling the current income tax assets and liabilities by net amount and the deferred income tax and liabilities is relevant to the income tax which be collected from the same taxpaying bodies by the same tax collection and administration department or is relevant to the different taxpaying bodies but during each period which there is significant reverse of the deferred income assets and liabilities in the future and among which the involved taxpaying bodies intend to settle the current income tax and liabilities by net amount or are at the same time acquire the asset as well as liquidate the liabilities.
31. Lease
(1) Accounting Treatment of Operating Lease
Financial lease is the lease that actually transfers all risks and compensation related to assets ownership, and its ownership may transfer, or may not transfer. Other lease except financial lease is operating lease.
Business of operating leases recorded by the Group as the lessee
The rent expenses from operating leases shall be recorded by the lessee in the relevant asset costs or the profits and losses of the current period by using the straight-line method over each period of the lease term. The initial direct costs shall be recognized as the profits and losses of the current period. The contingent rents shall be recorded into the profits and losses of the current period in which they actually arise.
Business of operating leases recorded by the Group as the lessor
The rent incomes from operating leases shall be recognized as the profits and losses of the current period by using the straight-line method over each period of the lease term. The initial direct costs of great amount shall be capitalized when incurred, and be recorded into current profits and losses in accordance with the same basis for recognition of rent incomes over the whole lease term. The initial direct costs of small amount shall be recorded into current profits and losses when incurred. The contingent rents shall be recorded into the profits and losses of the current period in which they actually arise.
(2) Accounting Treatments of Financial Lease
Business of finance leases recorded by the Company as the lessee
On the lease beginning date, the Company shall record the lower one of the fair value of the leased asset and the present value of the minimum lease payments on the lease beginning date as the entering value in an account, recognize the amount of the minimum lease payments as the entering value in an account of long-term account payable, and treat the balance between the recorded amount of the leased asset and the long-term account payable as unrecognized financing charges. Besides, the initial direct costs directly attributable to the leased item incurred during the process of lease negotiating and signing the leasing agreement shall be recorded in the asset value of the current period. The balance through deducting unrecognized financing charges from the minimum lease payments shall be respectively stated in long-term liabilities and long-term liabilities due within 1 year.
Unrecognized financing charges shall be adopted by the effective interest rate method in the lease term, so as to calculate and recognize current financing charges. The contingent rents shall be recorded into the profits and losses of the current period in which they actually arise.
32. Other Significant Accounting Policies and Estimates
(1) Measurement of fair value
Fair value refers to the price received from selling any asset or paid for transferring any liability in the orderly transactions that occur on the measurement date of the market participants. The Group should consider the characteristics of the assets or liabilities when
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 measuring the relevant assets or liabilities by fair value; to suppose the transactions of selling or transferring the assets on the measurement date by the market participants is the orderly transactions under the conditions of the current market; to suppose the orderly transaction of selling or transferring the assets is executing in the market of the relevant assets or liabilities; to suppose the transaction is executing in the most favorable market of the relevant assets or liabilities if there is no any main market. The Group adopts the advice used when pricing the assets or liabilities for realizing the maximum of the economy benefits by the market participants.
The Group judges the fair value of initial recognition whether is equal to the transaction price according to the characteristics of the relevant assets or liabilities with transaction nature etc.; if the transaction price and fair value is not equal, should include the relevant gains or losses in the current gains and losses except for those stipulated by other relevant ASBE.
The Group adopts the assessment technology which adapt to the current conditions with sufficient available data and other information support, and the assessment technology mainly including the market method, equity method and cost method. In the application of the assessment technology, the Group should prefer the relevant observable input value and only when the relevant observable input value could not be required or required the not feasible value, could use the not observable input value.
The input value used for the fair value measurement is divided into three levels and the first level of the input value is initially used, then come to the second level and the third one the last. The first level input value is the quotation acquired from the active market of the same assets or liabilities that had not be adjusted; the second input value is the input value could be directly or indirectly observed of the relevant assets or liabilities except for the first level input value; the third level input value is the not observable input value of the relevant assets or liabilities.
The Group measures the non-financial assets by fair value by considering the ability of the market participants when using the assets for the best purpose for causing the economy benefits or the ability to sell the assets to the other market participants which can use them with the best purpose for causing the economy benefits. The Group supposes to transfer the liabilities to other market participants on the measurement date and the liabilities would be continue to exist after the transfer as well as to be as the market participants of the transferees to execute the obligation when measuring the liabilities by fair value. The Group supposes to transfer the self equity instruments to other market participants on the measurement date and the self equity instruments would be continue to exist after the transfer as well transferees as to acquire the relevant rights and to undertake the relevant obligations as the market participants of the s.
(2) Termination of operation
Termination of operation refers to a separately identifiable constituent part that satisfies one of the following conditions that has been disposed of by the Company or is classified as held-for-sale:This constituent part represents an independent main business or a separate main business area.This constituent part is part of an associated plan that is intended to be disposed of in an independent main business or a separate major business area.This constituent part is a subsidiary that is specifically acquired for resale. For details of accounting arrangement method of termination of operation, see relevant descriptions of Note IV. 12 Assets Held for Sale and Disposal Group
(3) Segmental report
The Group recognizes the operating segments according to the internal organization structure, the management requirements and the internal report system and recognizes the reporting segments and discloses the segmental information according base on the operating segments.
Operating segments refer to the compose parts of the Group which meet with the following conditions at the same time: (1). the compose part could cause revenues and expenses in the daily activities; (2). the management layer could periodically evaluate the operation results of the compose part and base which to distribute the resources and evaluate the performance; (3). the Group could acquire the relevant accounting information of the financial conditions, operation results and the cash flows of the compose part. If two or more operating segments own the similar economy characteristics and meet with certain conditions, could be combining as an operating segment.
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 33. Changes in Main Accounting Policies and Estimates
(1) Change of Accounting Policies
□ Applicable√ Not applicable
(2) Changes in Accounting Estimates
□ Applicable√ Not applicable
34. Other
Significant Accounting Adjustment and Estimates
Due to the internal uncertainty of operating activities, the Company needs to make judgments, estimates and assumptions for carrying amounts of statement items thatcan‘t be measured accurately during the process of applying accounting policies. Such judgments, estimates and assumptions are made on the basis of the past experience ofCompany‘s management staffs and on the consideration of other relevant factors. Such judgments, estimates and assumptions have effect on reporting amount of incomes, expense, assets and liabilities, as well as disclosure of contingent liabilities on the balance sheet date. However, the uncertainty of such estimates may results in major adjustments of carrying amounts of assets or liabilities that will be influenced in future.
The Company shall have a check on the aforesaid judgments, estimates and assumptions at fixed intervals on the basis of sustainable operation. As for the change in accounting estimates that only effects on the current period of the change, the affected amount thereof shall be recognized at current period of the change. As for accounting estimates that effects on both the current period of the change and future periods, the affected amount thereof shall be recognized at current period of the change and future periods.
On balance sheet date, major fields requiring judgments, estimates and assumptions on amounts of financial statement items by the Company are as follows:
(1) Classification of leases
In line with rules in Accounting Standards for Enterprises No. 21– Leases, the Company classifies leases into operating leases and finance leases. Upon the classification, the management staffs need to make analysis and judgments on whether to essentially transfer all risks and remuneration relating to the ownership of leased-out assets to the lessee, or whether the Company has essentially undertaken all risks and remuneration relating to the ownership of leased-in assets.
(2) Withdrawal of bad debt provisions
The Company shall, in accordance with accounting policies of receivables, calculate bad debt provisions by adopting allowance method. Impairment of accounts receivable is based on the assessment of the recovery of accounts receivable. Identification of impairment of accounts receivable requires judgments and estimates by management staffs. The difference between actual outcomes and originally estimated outcomes, which will influence the carrying amount of accounts receivable and bad debt provisions thereof in the estimated period of the change, shall be withdrawn or reversed.
(3) Inventory depreciation reserves
The Company shall calculate whichever is lower between the cost and realizable net value in light of inventory accounting policies. As for inventories of which the cost is higher than the realizable net value and inventories which are obsolete and unsalable inventory depreciation reserves shall be withdrawn. Impairment of inventories to realizable net value is based on the assessment of the marketing of inventories and realizable net value thereof. Identification of inventory impairment requires well-established evidences by management staffs, as well as judgments and estimates based on consideration of the purpose of holding inventories and other factors such as events occurring after the date of balance sheet. The difference between actual outcomes and originally estimated
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 outcomes, which will influence the carrying amount of inventories and inventory depreciation reserves in the estimated period of the change, shall be withdrawn or reversed.
(4) Fair values of financial instruments
As for financial instruments not existing in active trading market, the Company shall determine their fair values by all kinds of assessment methods, which include model analysis of discounted cash flow and etc. During the assessment, the Company needs to assess for respects such as future cash flows, credit risks, market volatility, correlation, and choose appropriate discount rate. Such related assumptions have uncertainty, of which the change will effect on fair values of financial instruments.
(5) Impairment of financial assets available for sale
To a large extent, whether the impairment of financial assets available for sale is recognized or not relies on the judgments and assumptions of the management staffs. In that way, the Company shall be certain about whether to recognize impairment losses of financial assets available for sale in the profit statement. During the process of making judgments and assumptions, the Company needs to evaluate how much the fair value of such investment is less than its cost, how long such investment will last, and the financial condition and short-term business outlook of the invested parties, which include industry status, technology transform, credit rating, default rate and risks from the opposite parties.
(6) Impairment provisions for long-term assets
The Company shall judge whether there is sign of impairment of non-current assets other than financial assets on balance sheet date. Intangible assets with uncertain service lives, besides being conducted with annual impairment test every year, have to accept impairment tests when there is sign of impairment. Other non-current assets except for financial assets have to accept impairment tests when there is sign indicating the carrying amount thereof is unrecoverable.
When the carrying amounts of the asset or group assets are higher than the recoverable amounts, namely whichever is higher between the net amount through deducting disposal charges from the fair value and the present value of the estimated future cash flow, impairment occurs.
The net amount of the fair value of an asset minus the disposal expenses shall be determined in light of the amount of the basis of the price as stipulated in the sales agreement or the observable market price in the fair transaction minus the incremental cost directly subject to the disposal of the asset.
When estimating present value of future cash flows, it is necessary to make significant judgments on characters of the asset or asset group, such as output, sales price, related operating costs, and discount used to calculate the present value. When estimating recoverable amount, the Company shall adopt all relevant materials that can be required, including estimates relating to output, sales price and relevant operating costs judged by rational and supportable assumptions.
The Company tests whether there is impairment of good will at least for every year, which requires itself to estimate the present value of the future cash flow of group assets or combination of group assets. When estimating the present value of the future cash flow, the Company needs to estimate the cash flow arising from future group assets or combination of group assets, and at the same time choose appropriate discount rate to determine the present value of the future cash flow.
(7) Depreciation and amortization
Upon consideration on the salvage value of investment real estates, fixed assets and intangible assets, the Company shall withdraw depreciation and amortization by straight-line method over their service lives. The Company checks on service lives at fixed intervals, so as to determine the amounts of depreciation expenses and amortization expenses at each period. Service lives are confirmed in accordance with the past experience on similar assets of the Company, along with renewed technology of expectation. If any significant change occurred to previous estimated, depreciation expenses and amortization expenses will be adjusted in future period. (8) Deferred income tax assets
In a limit providing large possibility of offset losses from sufficient taxable profits, the Group shall recognize deferred income tax assets in line with all unused tax losses, which requires management staffs of the Group to estimate the time when future taxable
profits occurs and the amount thereof by applying plenty of judgments and combining tax planning strategies, so as to determine the
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 amount of the recognizable deferred income tax assets.
(9) Income taxes
There‘s certain uncertainty of disposal and calculation of taxes of partial transactions in normal operating activities. It is uncertain whether some pre-taxed items can set aside the approvals by tax authorities or not. If there are differences between the ultimate recognition outcomes and the originally estimated amounts of such tax issues, then such differences shall effect on the current income tax and deferred income tax during the ultimate recognition period.
VI Taxes
1. Main Taxes and Tax Rates
||||
|-|-|-|
|Category of taxes|Tax basis|Tax rate|
|VAT|Operating revenue|For details, see 3. Other of this section|
|||Applied to 7%, 1% separately according to|
|Urban maintenance and construction tax|Turnover tax payable||
|||the regional level|
|Enterprise income tax|Taxable income|15%, 20%, 16.5%, 25%|
|||Paid according to 3% of the actual paid|
|Education surcharge|Taxable income||
|||turnover tax|
|||Paid according to 2% of the actual paid|
|Local education surcharge|Taxable income||
|||turnover tax|
|||Four progressive levels with the tax rate|
||Added amount from transfer of real||
|Land value appreciation tax||ranging from 30% to 60% of transferring|
||property||
|||real estate added value|

Notes of the disclosure situation of the taxpaying bodies with different enterprises income tax rate
|||
|-|-|
|Name|Income tax rate|
|Chongqing Shenzhen International Trade Center Property||
||15%|
|Management Co., Ltd.||
|Chongqing Aobo Elevator Co., Ltd.|20%|
|Subsidiaries registered in Hong Kong area|16.5%|
|Other taxpaying bodies within the consolidated scope|25%|

2. Tax Preference
According to the regulations of No. 2, Property Service of No. 37, Commercial Service among the encouraging category of the Guidance Catalogue of Industry Constructure Adjustment (Y2011), the western industry met with the conditions should be collected the corporate income tax according to15% of the tax rate. The subsidiary of the Group Chongqing Shenzhen International Trade Center Property Management Co., Ltd. had be regarded as the western enterprise of the property service by Local Taxation Bureau of Chongqing Jiulong District on 4 May 2014, and had be collected the corporate income tax according to15% of the tax rate.
According to the regulations of the notice of the income tax preferential policies of the small low-profit enterprises issued by SAT of
CS[2015] No. 34, from 1 January 2017 to 31December 2019, as for those small low-profit enterprises with the annual after-tax
amount lower than RMB0.2 million (including RMB0.2 million), of which50% of the revenues should be included into the taxable
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 income and should be collected the corporate income tax according to20% of the tax rate. The subsidiary of the Company, Chongqing Aobo Elevator Co., Ltd, has applied to this policy since 2017, which50% of the revenues is included into the taxable income and is collected the corporate income tax according to20% of the tax rate.
3. Other
Note 1. Taxable items and tax rate of the VAT of the Company and its subsidiaries are as follows:
|||
|-|-|
|Type of the revenue|General rate|
|Sales of house property|10%|
|Rent of real estate|10%|
|Property service|6%|
|Catering service|6%|
|Others|16%|

VII. Notes to Major Items in the Consolidated Financial Statements of the Company
1. Monetary Funds
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|
|Cash on hand|176,193.08|164,502.21|
|Bank deposits|3,375,538,497.01|2,463,348,038.01|
|Other monetary funds|13,519,667.63|13,516,274.99|
|Total|3,389,234,357.72|2,477,028,815.21|
|Of which: the total amount deposited|||
||52,976,296.80|50,659,691.68|
|overseas|||

Other notes:
Note: on 31 December 2018, the monetary capital with restricted ownership of the Company was of RMB13,519,667.63, for details, see Note XIV. 2. (2).
2. Financial Assets at Fair Value through Profit or Loss
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|

Other notes:
Naught
3. Derivative Financial Assets
□ Applicable√ Not applicable
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 4. Notes Receivable and Accounts Receivable
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|
|Accounts receivable|64,231,267.94|46,272,600.86|
|Total|64,231,267.94|46,272,600.86|

 (1)Notes Receivable
1) Notes Receivable Listed by Category
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|

2) Notes Receivable Pledged by the Company at the Period-end
Unit: RMB
|||
|-|-|
|Item|Amount|

3) Notes Receivable which Had Endorsed by the Company or had Discounted and had not Due on the Balance Sheet Date at the Period-end
Unit: RMB
||||
|-|-|-|
||Amount of recognition termination at the|Amount of not terminated recognition at|
|Item|||
||period-end|the period-end|

4) Notes Transferred to Accounts Receivable because Drawer of the Notes Failed to Execute the Contract or Agreement
Unit: RMB
|||
|-|-|
||Amount of the notes transferred to accounts receivable at theperiod-end|
|Item||

Other notes:
(2)Accounts Receivable
1) Accounts Receivable Classified by Category
Unit: RMB
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
||Ending balance|||||Beginning balance|||||
||Carrying amount||Bad debt provision|||Carrying amount||Bad debt provision|||
|||||Withdrawalproportion|||||||
|Category|||||Carrying|||||Carrying|
|||Proportio|||||Proportio||Withdrawal||
||Amount||Amount||value|Amount||Amount||value|
|||n|||||n||proportion||
|Accounts receivable|||||||||||
||99,466,1||99,466,1|||99,466,||99,466,17|||
|with significant||59.08%||100.00%|||66.53%||100.00%||
||73.89||73.89|||173.89||3.89|||
|single amount with|||||||||||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
|bad debt provision|||||||||||
|separately accrued|||||||||||
|Accounts receivable|||||||||||
|withdrawn bad debt|||||||||||
||67,955,2||3,724,01||64,231,26|49,088,||2,816,177||46,272,600.|
|provision according||40.36%||5.48%|||32.84%||5.74%||
||77.98||0.04||7.94|778.72||.86||86|
|to credit risks|||||||||||
|characteristics|||||||||||
|Accounts receivable|||||||||||
|with insignificant|||||||||||
|single amount for|942,824.||942,824.|||942,824||942,824.5|||
|||0.56%||100.00%|||0.63%||100.00%||
|which bad debt|55||55|||.55||5|||
|provision separately|||||||||||
|accrued|||||||||||
||168,364,||104,133,||64,231,267.94|149,497||103,225,1||46,272,600.86|
|Total||100.00%||61.85%|||100.00%||69.05%||
||276.42||008.48|||,777.16||76.30|||

 Accounts receivable with significant single amount for which bad debt provision separately accrued at theperiod-end：
√Applicable□ Not applicable
Unit: RMB
||||||
|-|-|-|-|-|
|Accounts receivable|Ending balance||||
|(classified by units)|Accounts receivable|Bad debt provision|Proportion|Reason|
|||||Involved in lawsuit and|
|Shenzhen Jiyong|||||
|||||no executable property,|
|Properties & Resources|93,811,328.05|93,811,328.05|100.00%||
|||||and see details in Notes|
|Development Company|||||
|||||(XIV). 2. (1)|
|Shenzhen Tewei Industry||||Uncollectible for a long|
||2,836,561.00|2,836,561.00|100.00%||
|Co., Ltd.||||period|
|||||Poor operating|
|Lunan Industry|||||
||2,818,284.84|2,818,284.84|100.00%|conditions, uncollectible|
|Corporation|||||
|||||for a long period|
|Total|99,466,173.89|99,466,173.89|--|--|

In the groups, accounts receivable adopting aging analysis method to withdraw bad debt provision:
√ Applicable□ Not applicable
Unit: RMB
|||||
|-|-|-|-|
||Ending balance|||
|Aging||||
||Accounts receivable|Bad debt provision|Withdrawal proportion|
|Sub-item within 1 year||||
|Within 1 year|61,150,863.40|1,834,525.90|3.00%|
|Subtotal within 1 year|61,150,863.40|1,834,525.90|3.00%|
|1 to 2 years|3,555,648.91|355,564.89|10.00%|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||
|-|-|-|-|
|2 to 3 years|1,889,494.67|566,848.40|30.00%|
|3 to 4 years|740,994.66|370,497.33|50.00%|
|4 to 5 years|108,514.08|86,811.26|80.00%|
|Over 5 years|509,762.26|509,762.26|100.00%|
|Total|67,955,277.98|3,724,010.04||

Notes of the basis of recognizing the group:
Note: The basic of recognizing the group refers to Notes V. 11―AccountsReceivable‖ (2).
In the groups, accounts receivable adopting balance percentage method to withdraw bad debt provision
□ Applicable√ Not applicable
In the groups, accounts receivable adopting other methods to accrue bad debt provision:
Not applicable
2) Accounts Receivable Withdraw, Reversed or Collected during the Reporting Period
The withdrawal amount of the bad debt provision during this Reporting Period was of RMB907,832.18; the amount of the reversed or collected part during this Reporting Period was of RMB0.00.
Of which significant amount of the reversed or collected:
Unit: RMB
||||
|-|-|-|
|Name of the entity|Amount|Method|

Naught
3) Particulars of the Actual Verification of Accounts Receivable during the Reporting Period
Unit: RMB
|||
|-|-|
|Item|Amount|

Of which: significant actual verification of accounts receivable
Unit: RMB
|||||||
|-|-|-|-|-|-|
||||||Whether occurred|
||||||because of|
|Name of the entity|Nature|Amount|Reason|Procedure||
||||||related-party|
||||||transactions|

 Notes of the verification of accounts receivable:
Naught
(4) Top 5 of the Ending Balance of the Accounts Receivable Collected according to the Arrears Party
|||||
|-|-|-|-|
|Name of units|Relationship withthe Company|Amount|Age limit|
|Shenzhen Jiyong Properties &Resources DevelopmentCompany|Not-related|93,811,328.05|Over 5 years|
|Alibaba Internet TechnologyCo., Ltd|Not-related|21,389,086.53|Within 1 year|
|Shenzhen Tewei Industry Co.,|Not-related|2,836,561.00|Over 5 years|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||
|-|-|-|-|
|Ltd.||||
|Lunan Industry Corporation|Not-related|2,818,284.84|Over 5 years|
|Shangdong Finance Real EstateCo., Ltd|Not-related|1,891,934.56|Within 1 year|
|Total||122,747,194.98||

5) Derecogniziton of Accounts Receivable due to the Transfer of Financial Assets
Not applicable
6) The Amount of the Assets and Liabilities Formed due to the Transfer and the Continued Involvement of Accounts Receivable Not applicable
Other notes:
Not applicable
5. Prepayments
(1) List by Aging Analysis
Unit: RMB
||||||
|-|-|-|-|-|
||Ending balance||Beginning balance||
|Aging|||||
||Amount|Proportion|Amount|Proportion|
|Within 1 year|27,130,150.07|75.54%|16,414,273.12|58.31%|
|1 to 2 years|8,272,467.04|23.04%|11,704,985.06|41.58%|
|2 to 3 years|500,503.40|1.39%|20,656.62|0.07%|
|Over 3 years|10,043.81|0.03%|10,041.80|0.04%|
|Total|35,913,164.32|--|28,149,956.60|--|

Notes of the reasons of the prepayment aging over 1 year with significant amount but failed settled in time:
The prepayment aging over 1 year are the various prepaid taxes, like business tax, Urban construction tax, and educational surtax of prepayment of real estate projects still not reaching the recognition of income conditions according to tax law.
(2) Top 5 of the Ending Balance of the Prepayments Collected according to the Prepayment Target
|||
|-|-|
|Name of units|Ending balance|
|Prepayment of taxes|33,676,909.33|
|State Grid Chongqing Electric PowerCo., Ltd|475,000.00|
|Chongqing Caitong Water Affairs Co.,Ltd|300,000.00|
|Shenzhen Tianfu Fire Engineering Co.,|266,000.00|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||
|-|-|
|Ltd||
|Shenzhen Jian‘an (Group) Co., Ltd|116,000.00|
|Total|34,833,909.33|

Other notes:
The balance of prepayment of taxes of the Company are the various prepaid taxes, like business tax, Urban construction tax, and educational surtax of prepayment of real estate projects still not reaching the recognition of income conditions according to tax law. 6. Other Receivables
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|
|Interest receivable|8,293,317.33||
|Other receivables|16,135,093.86|91,345,782.84|
|Total|24,428,411.19|91,345,782.84|

 (1) Interest Receivable
1) Category of Interest Receivable
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|
|Fixed time deposits|8,293,317.33||
|Total|8,293,317.33||

2) Significant Overdue Interest
Unit: RMB
||||||
|-|-|-|-|-|
|||||Whether occurred|
|Entity|Ending balance|Overdue time|Overdue reason|impairment and the|
|||||judgment basis|

 Other notes:
Naught
(2) Dividends Receivable
1) Dividends Receivable
Unit: RMB
||||
|-|-|-|
|Item (or investees)|Ending balance|Beginning balance|

2) Significant Dividends Receivable Aged over 1 Year
Unit: RMB
||||||
|-|-|-|-|-|
|||||Whether occurred|
|Item (or investees)|Ending balance|Aging|Reason||
|||||impairment and the|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||
|-|
|judgment basis|

 Other notes:
None
(3) Other Receivables
1) Other Receivables Classified by Category
Unit: RMB
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
||Ending balance|||||Beginning balance|||||
||Carrying amount||Bad debt provision|||Carrying amount||Bad debt provision|||
|||||Withdra|||||||
|Category|||||Carrying|||||Carrying|
|||Proportio||wal|||Proportio||Withdrawal||
||Amount||Amount||value|Amount||Amount||value|
|||n||proportio|||n||proportion||
|||||n|||||||
|Other receivables|||||||||||
|with significant|||||||||||
|single amount for|14,066,6||14,066,6|||21,046,||21,046,88|||
|||28.97%||100.00%|||15.94%||100.00%||
|which bad debt|15.90||15.90|||888.91||8.91|||
|provision separately|||||||||||
|accrued|||||||||||
|Other receivables|||||||||||
|withdrawn bad debt|||||||||||
||29,649,4||13,514,3||16,135,09|105,826||14,481,06||91,345,782.|
|provision according||61.06%||45.58%|||80.16%||13.68%||
||37.37||43.51||3.86|,852.42||9.58||84|
|to credit risks|||||||||||
|characteristics|||||||||||
|Other receivables|||||||||||
|with insignificant|||||||||||
|single amount for|4,845,26||4,845,26|||5,144,0||5,144,059|||
|||9.98%||100.00%|||3.90%||100.00%||
|which bad debt|3.65||3.65|||59.49||.49|||
|provision separately|||||||||||
|accrued|||||||||||
||48,561,3||32,426,2||16,135,093.86|132,017||40,672,01||91,345,782.84|
|Total||100.00%||66.45%|||100.00%||30.81%||
||16.92||23.06|||,800.82||7.98|||

 Other receivables with significant single amount for which bad debt provision separately accrued at the period-end
√ Applicable□ Not applicable
Unit: RMB
||||||
|-|-|-|-|-|
|Other receivables (by|Ending balance||||
|unit)|Other receivables|Bad debt provision|Withdrawal proportion|Withdrawal reason|
|Shanghai Yutong Real||||Difficult to recover the|
||5,676,000.00|5,676,000.00|100.00%||
|estate development Co.,||||lawsuit judgment|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||||
|-|-|-|-|-|
|Ltd.|||||
|Hong Kong Yueheng||||Unrecoverable for a long|
||3,271,837.78|3,271,837.78|100.00%||
|Development Co., Ltd.||||term|
|Dameisha Tourism||||Projects construction ce|
||2,576,445.69|2,576,445.69|100.00%||
|Center||||ased|
|||||Projects construction|
|Elevated Train Project|2,542,332.43|2,542,332.43|100.00%||
|||||ceased|
|Total|14,066,615.90|14,066,615.90|--|--|

Among these groups, other receivables adopting aging analysis method to withdraw bad debt provision:
√ Applicable□ Not applicable
Unit: RMB
|||||
|-|-|-|-|
||Ending balance|||
|Aging||||
||Other receivables|Bad debt provision|Withdrawal proportion|
|Subentry within 1 year||||
|Within 1 year|9,777,854.77|293,335.65|3.00%|
|Subtotal within 1 year|9,777,854.77|293,335.65|3.00%|
|1 to 2 years|3,747,597.17|374,759.72|10.00%|
|2 to 3 years|3,711,862.45|1,113,558.73|30.00%|
|3 to 4 years|1,101,987.13|550,993.56|50.00%|
|4 to 5 years|642,200.00|513,760.00|80.00%|
|Over 5 years|10,667,935.85|10,667,935.85|100.00%|
|Total|29,649,437.37|13,514,343.51||

Notes:
Note: refer to Note V-11. Accounts Receivable-(2) for relevant details.
Among these groups, other receivables adopting balance percentage method to withdraw bad debt provision:
□ Applicable√ Not applicable
Among these groups, other receivables adopting other methods to withdraw bad debt provision:
□ Applicable√ Not applicable
2) Bad Debt Provision Withdrawn, Reversed or Recovered in the Reporting Period
The withdrawal amount of the bad debt provision during the Reporting Period was of RMB0.00; the amount of the reversed or collected part during the Reporting Period was of RMB1,268,154.93.
Significant amount of reversed or recovered bad debt provision during the Reporting Period:
Unit: RMB
||||
|-|-|-|
|Name of the entity|Reversed or collected amount|Method|

The withdrawal amount of bad debt provision in current period is RMB0.00; the exchange rate translation for the foreign-currency
loans withdrawal amount of bad debt provision receivable and foreign-currency financial statement translation increased bad debt
provision is RMB2,633.02. As the court ruled that Shenzhen Shengfeng Road, Guomao Jewel& Gold Co., Ltd. ended the bankruptcy
proceedings, it transferred RMB6,980,273.01 to the other current assets with the original value. the amount of the reversed or collected
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 part during the Reporting Period was of RMB1,268,154.93.
3) Particulars of the Actual Verification of Other Receivables during the Reporting Period
Unit: RMB
|||
|-|-|
|Item|Amount|

Of which: significant actual verification of other receivables:
Unit: RMB
|||||||
|-|-|-|-|-|-|
||||||Whether occurred|
||||||because of|
|Name of the entity|Nature|Amount|Reason|Procedure||
||||||related-party|
||||||transactions|

 Notes of verification of other receivables:
None
4) Other Receivables Classified by Account Nature
Unit: RMB
||||
|-|-|-|
|Nature|Ending carrying amount|Beginning carrying amount|
|Margin|11,525,412.63|10,114,308.11|
|Cash deposit|4,592,622.32|2,683,810.92|
|Petty cash|595,535.66|1,565,686.27|
|Payments on behalf|1,054,967.78|973,252.97|
|Intercourse funds|28,022,997.15|114,000,793.48|
|Other|2,769,781.38|2,679,949.07|
|Total|48,561,316.92|132,017,800.82|

 5) Top 5 of the Ending Balance of the Other Receivables Collected according to the Arrears Party
Unit: RMB
|||||||
|-|-|-|-|-|-|
|||||Proportion to ending||
||||||Ending balance of|
|Name of the entity|Nature|Ending balance|Aging|balance of other||
||||||bad debt provision|
|||||receivables%||
|Shanghai Yutong||||||
|Real estate||||||
||Non-related party|5,676,000.00|Over 5 years|9.98%|5,676,000.00|
|development Co.,||||||
|Ltd.||||||
|Hong Kong Yueheng||||||
|Development Co.,|Non-related party|3,271,837.78|Over 5 years|5.75%|3,271,837.78|
|Ltd.||||||
|Yangzhou Housing||||||
|Loans Guarantee|Non-related party|2,750,000.00|1-5 years|4.84%|722,000.00|
|Service Center||||||
|Dameisha Tourism|Non-related party|2,576,445.69|Over 5 years|4.53%|2,576,445.69|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||||
|-|-|-|-|-|-|
|Center||||||
|Elevated Train||||||
||Non-related party|2,542,332.43|Over 5 years|4.47%|2,542,332.43|
|Project||||||
|Total|--|16,816,615.90|--|29.57%|14,788,615.90|

 6) Accounts Receivable Involving Government Subsidies
Unit: RMB
||||||
|-|-|-|-|-|
||Project of government|||Estimated recovering|
|Name of the entity||Ending balance|Aging at period-end||
||subsidies|||time, amount and basis|

 None
7) Derecogniziton of Other Receivables due to the Transfer of Financial Assets
None
8) The Amount of the Assets and Liabilities Formed due to the Transfer and the Continued Involvement of Other Receivables None
Other notes:
As the court ruled that Shenzhen Shengfeng Road, Guomao Jewel& Gold Co., Ltd. ended the bankruptcy proceedings, RMB6,980,273.01 was transferred into other current assets with the original value.
|||||
|-|-|-|-|
|Name of the entity|Nature of otherreceivables|Amount transferred out||
|||Otherreceivables|Bad debtprovision|
|Shenzhen ShengfengRoad, Guomao Jewel& Gold Co., Ltd.|Rental fees andutilities|6,980,273.01|6,980,273.01|
|Total|——|6,980,273.01|6,980,273.01|

7. Inventories
Whether the Company need satisfy relevant disclosure requirements governing the real estate industry
Yes
(1) Category of Inventories
The Company needs to comply with the disclosure requirements of Shenzhen Stock Exchange Industry Information Disclosure Guidelines No.3-Listed Companies Engaged in Real Estate Industry
Classified by nature
Unit: RMB
||||||||
|-|-|-|-|-|-|-|
||Ending balance|||Beginning balance|||
|Item||Falling price|||Falling price||
||Carrying amount||Carrying value|Carrying amount||Carrying value|
|||reserves|||reserves||
|R&D expenses|740,858,627.04|6,648,404.13|734,210,222.91|522,188,965.52|6,648,404.13|515,540,561.39|
|R&D of products|448,118,524.87|1,611,969.40|446,506,555.47|1,365,998,591.00|31,737,353.10|1,334,261,237.90|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||||||
|-|-|-|-|-|-|-|
|Raw materials|1,306,660.68|489,471.7|9 817,188.89|1,157,601.08|506,000.68|651,600.40|
|Inventory good|54,416.03||54,416.03|37,870.66||37,870.66|
|Low-value|||||||
|consumption|174,148.37||174,148.37|180,774.01||180,774.01|
|goods|||||||
|Total|1,190,512,376.99|8,749,845.3|2 1,181,762,531.67|1,889,563,802.27|38,891,757.91|1,850,672,044.36|

 Disclose main items ofR&D expenses and interest capitalization thereof as the following format:
Unit: RMB
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
||||||Shifted||Increase|||Of which:||
|||||||Other|||Accumula|||
|||Estimated|Estimated||developin||(Costs of|||amount of||
||Date of|||||decreased|||tive|||
|Name of||date of|total|Beginnin|g||developm|Ending||capitalize|Capital|
||commenc|||||sums for|||amount of|||
|project||completio|investmen|g balance|properties||ent) for|balance||d interests|resources|
||ement|||||this|||capitalize|||
|||n|t||for this||this|||for this||
|||||||period|||d interests|||
||||||period||period|||period||
|Shenzhen||||||||||||
|Properties||||||||||||
|&|1 March|30 April|1,595,600|400,891,6|||217,725,1|618,616,8|3,882,239|||
|||||||||||23,367.37|Other|
|Resources|2014|2019|,000.00|67.55|||78.68|46.23|.73|||
|•Jinling||||||||||||
|Holiday||||||||||||
|Fuchang|29|||||||||||
|||30 June|969,290,0|6,024,627|||827,036.5|6,851,663||||
|Garden|December||||||||||Other|
|||2021|00.00|.11|||4|.65||||
|Phase II|2018|||||||||||
|Hainan||||||||||||
|||||6,648,404||||6,648,404||||
|Qiongsha|||||||||||Other|
|||||.13||||.13||||
|n Land||||||||||||
|Shenhui||||||||||||
|||||36,966,04||||37,002,03||||
|Garden|||||||35,990.00||||Other|
|||||0.89||||0.89||||
|Land||||||||||||
|Shenzhen||||||||||||
|Properties||||||||||||
|&|30|||||||||||
|||31 July|170,000,0|71,658,22||||71,739,68||||
|Resources|December||||||81,456.30||||Other|
|||2020|00.00|5.84||||2.14||||
|•Banshan|2018|||||||||||
|yujing||||||||||||
|Phase II||||||||||||
||||2,734,890|522,188,9|||218,669,6|740,858,6|3,882,239|||
|Total|--|--||||||||23,367.37|--|
||||,000.00|65.52|||61.52|27.04|.73|||

Disclosing main items of―Developingproperties‖ in the following format:
Unit: RMB
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||||||
|-|-|-|-|-|-|-|-|
|||||||Accumulative|Of which: amount|
|Name of|Date of|Beginning||||amount of|of capitalized|
||||Increase|Decrease|Ending balance|||
|project|completion|balance||||capitalized|interests for this|
|||||||interests|period|
|Internationa||||||||
|l Trade|1 December|||||||
|||4,839,083.10|||4,839,083.10|||
|Center|1995|||||||
|Plaza||||||||
|Huangyuyu||||||||
||1 June 2001|790,140.58|||790,140.58|||
|an A Area||||||||
|Podium||||||||
||1|||||||
|Building of||||||||
||November|645,532.65|||645,532.65|||
|Fuchang||||||||
||1999|||||||
|Building||||||||
|Shenzhen||||||||
|Properties||||||||
|&||||||||
||1 December|||||||
|Resources•||27,154,592.60||15,637,396.49|11,517,196.11|||
||2012|||||||
|Langqiao||||||||
|Internationa||||||||
|l||||||||
|Shenzhen||||||||
|Properties||||||||
|&||||||||
|Resources•|1 June 2015|99,025,705.00||25,204,143.59|73,821,561.41|10,446,911.43||
|Hupan||||||||
|Yujing||||||||
|Phase I||||||||
|Shenzhen||||||||
|Properties||||||||
|&||||||||
||1 January|240,944,014.8||189,764,951.7||||
|Resources•|||||51,179,063.15|14,633,486.15||
||2016|5||0||||
|Front Sea||||||||
|Harbor||||||||
|Garden||||||||
|Shenzhen||||||||
|Properties||||||||
|&|1|||||||
|||179,738,838.0||112,079,650.6||||
|Resources•|November||||67,659,187.47|27,205,315.95||
|||8||1||||
|Banshan|2016|||||||
|Yujing||||||||
|Phase I||||||||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||||
|-|-|-|-|-|-|
|Shenzhen||||||
|Properties||||||
|&||156,800,740.0||||
||1 July 2017||88,701,712.72|68,099,027.29|30,539,392.65|
|Resources•||1||||
|Songhu||||||
|Langyuan||||||
|Shenzhen||||||
|Properties||||||
||1|||||
|&||652,331,580.6|486,449,246.6|||
||November|||165,839,369.65||
|Resources•||7|3|||
||2017|||||
|Hupanyujin||||||
|g Phase II||||||
|Other||||||
|||3,728,363.46||3,728,363.46|83,077,702.96|
|projects||||||
|||1,365,998,591.|917,837,101.7|||
|Total|--|||448,118,524.87|165,902,809.14|
|||00|4|||

Classification of―Developing properties with the collection of payments ininstallments‖,―Renting developingproperties‖ and―TemporaryHousing‖:
Unit: RMB
||||||
|-|-|-|-|-|
|Item|Beginning balance|Increase|Decrease|Ending balance|

Whether the Company need satisfy relevant disclosure requirements stated in SZSE Industrial Information Disclosure Guidance No.11-Listed Company Specialized in Jewelry-related Business or not?
No
(2) Falling Price Reserves of Inventories
Disclosure of falling provision withdrawal of inventory in the following format:
Classified by nature:
Unit: RMB
|||||||||
|-|-|-|-|-|-|-|-|
|||Increase||Decrease||||
||Beginning|||||||
|Item||||Reverse or||Ending balance|Note|
||balance|Withdrawal|Other||Other|||
|||||write-off||||
|Costs of|6,648,404.|||||||
|||||||6,648,404.13||
|development|13|||||||
|Developing|31,737,353|||||||
|||||30,125,383.70||1,611,969.40||
|properties|.10|||||||
|Raw materials|506,000.68|||16,528.89||489,471.79||
||38,891,757|||||||
|Total||||30,141,912.59||8,749,845.32|--|
||.91|||||||

Classification by main project:
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Unit: RMB
|||||||||
|-|-|-|-|-|-|-|-|
|||Increase||Decrease||||
||Beginning|||||||
|Name of project||||Reverse or||Ending balance|Remarks|
||balance|Withdrawal|Other||Other|||
|||||write-off||||
|Hainan|6,648,404.|||||||
|||||||6,648,404.13||
|Qiongshan Land|13|||||||
|Shenzhen||||||||
|Properties &|21,839,690|||||||
|||||20,227,720.70||1,611,969.40||
|Resources•Bansh|.10|||||||
|an Yujing Phase I||||||||
|Shenzhen||||||||
|Properties &|9,897,663.|||||||
|||||9,897,663.00||0.00||
|Resources•Hupan|00|||||||
|Yujing Phase I||||||||
||38,385,757|||||||
|Total||||30,125,383.70||8,260,373.53|--|
||.23|||||||

(3) Notes to the Ending Balance of Inventories Including Capitalized Borrowing Expense
The ending balance of the inventory included a total amount of the capitalized borrowings of RMB13,465,231.16, details were listed as follows:
Item Period-begin Reporting Period Carry-over in Period-end
current period
Banshan Yujing I 7,207,754.95 -- 4,922,621.25 2,285,133.71 Qianhai Gangwan 5,031,818.17 -- 3,962,152.57 1,069,665.60 GoldenCollar‘s Resort 3,858,872.36 23,367.37 -- 3,882,239.73 Songhu Langyuan 4,504,890.24 -- 3,388,797.28 1,116,092.96 Langqiao International 4,655,259.52 -- 1,683,272.97 2,971,986.54 Hupan Yujing I 2,897,207.03 -- 757,094.41 2,140,112.62 Total 28,155,802.27 23,367.37 14,713,938.48 13,465,231.16 (4) Inventory Limit
Disclosed by project
Unit: RMB
|||||
|-|-|-|-|
|Name of project|Beginning balance|Ending balance|Reason for the Limit|
||||Guarantee for property|
|Completed development product|4,839,083.09|0.00||
||||conservation|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||
|-|-|-|-|
|Total|4,839,083.09|0.00|--|

(5) Completed but Unsettled Assets Generated from Construction Contacts at the Period-end
Unit: RMB
|||
|-|-|
|Item|Amount|

Other notes:
Not applicable
Whether the Company needs to comply with the disclosure requirements of Guideline No. 4 of the Shenzhen Stock Exchange on the Industrial Information Disclosure about ListedCompanies’ Engagement in Seed Industry and Planting Industry
No
8. Held-for-sale Assets
Unit: RMB
||||||
|-|-|-|-|-|
||||Estimated disposal||
|Item|Ending carrying value|Fair value||Estimated disposal time|
||||expense||

Other notes:
Not applicable
9. Current Portion of Non-current Assets
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|

Other notes:
Not applicable
10. Other Current Assets
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|
|1. Assets group (investment to Hainan|||
|Xinda and accounts receivable) held to|||
|cancel after verification|||
|Of which: original value of assets|||
||69,437,140.28|69,437,140.28|
|group|||
|Depreciation reserves of the assets|||
||-69,437,140.28|-69,437,140.28|
|group|||
|2. Assets group (investment to Nanpeng|||
|Papermaking and accounts receivable)|||
|held to cancel after verification|||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||
|-|-|-|
|Of which: original value of assets|||
||21,949,664.00|21,949,664.00|
|group|||
|Depreciation reserves of the assets|||
||-21,949,664.00|-21,949,664.00|
|group|||
|3. Assets group (investment to|||
|International Trade Industry and accounts|||
|receivable) held to cancel after verification|||
|Of which: original value of assets|||
||6,034,625.03|6,034,625.03|
|group|||
|Depreciation reserves of the assets|||
||-6,034,625.03|-6,034,625.03|
|group|||
|4. Assets group (accounts receivable from|||
|Jintian Industry) held to cancel after|||
|verification and other accounts receivable|||
|Of which: original carrying value of|||
||53,034,143.94|53,034,143.94|
|other receivables|||
|Bad debt provision|-53,034,143.94|-53,034,143.94|
|5. Assets group (accounts receivable from|||
|Shenzhen Shengfeng Road, Guomao Jewel|||
|& Gold Co., Ltd.) held to cancel after|||
|verification and other accounts receivable|||
|Of which: original carrying value of|||
||6,980,273.01||
|other receivables|||
|Bad debt provision|-6,980,273.01||
|6. Pre-paid VAT|16,644,131.80|12,301,387.50|
|7. Deducted input tax|50,276.32|69,433.47|
|Total|16,694,408.12|12,370,820.97|

 Other notes:
11. Available-for-sale Financial Assets
(1) List of Available-for-sale Financial Assets
Unit: RMB
||||||||
|-|-|-|-|-|-|-|
||Ending balance|||Beginning balance|||
|Item|Carrying|Depreciation||Carrying|Depreciation||
||||Carrying value|||Carrying value|
||amount|reserves||amount|reserves||
|Available-for-sale equity|||||||
||20,704,235.10|17,082,853.99|3,621,381.11|20,462,995.80|16,871,786.60|3,591,209.20|
|instruments:|||||||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||||||
|-|-|-|-|-|-|-|
|Measured at fair|||||||
||3,621,381.11||3,621,381.11|3,591,209.20||3,591,209.20|
|value|||||||
|Total|17,082,853.99|17,082,853.99||16,871,786.60|16,871,786.60||
|Total|20,704,235.10|17,082,853.99|3,621,381.11|20,462,995.80|16,871,786.60|3,591,209.20|

 (2) Available-for-sale Financial Assets Measured by Fair Value at the Period-end
Unit: RMB
|||||
|-|-|-|-|
||Available-for-sale equity|Available-for-sale debt||
|Category|||Total|
||instruments|instruments||
|Fair value|3,621,381.11||3,621,381.11|
|Depreciation amountwithdrawn||||
||0.00||0.00|

(3) Available-for-sale Financial Assets Measured by Cost at the Period-end
Unit: RMB
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
||Carrying amount||||Depreciation reserves||||Shareholdi|Cash|
||||||||||ng|bonus of|
|Investee|Period-beg||||Period-beg||||proportion|the|
|||Increase|Decrease|Period-end||Increase|Decrease|Period-end|||
||inning||||inning||||among the|Reporting|
||||||||||investees|Period|
|North|||||||||||
|Machinery|3,465,000.|||3,465,000.|3,465,000.|||3,465,000.|||
||||||||||12.66%||
|(Group)|00|||00|00|||00|||
|Co., Ltd.|||||||||||
|Guangdon|||||||||||
|g Huayue|||||||||||
||8,780,645.|||8,780,645.|8,780,645.|||8,780,645.|||
|Real|||||||||8.47%||
||20|||20|20|||20|||
|Estate Co.,|||||||||||
|Ltd.|||||||||||
|Sanya East|||||||||||
|Travel|230,500.00|||230,500.00|230,500.00|||230,500.00|0.28%||
|Co., Ltd.|||||||||||
|Shensan|||||||||||
||17,695.09|||17,695.09|17,695.09|||17,695.09|||
|Co., Ltd.|||||||||||
|Macao|||||||||||
|Huashen|||||||||||
||81,155.34|3,912.62||85,067.96|81,155.34|3,912.62||85,067.96|10.00%||
|Enterprise|||||||||||
|Co., Ltd.|||||||||||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||||||
|-|-|-|-|-|-|-|-|
|Chongqing||||||||
|Guangfa||||||||
|Real estate|2,462,546.||2,581,269.|2,462,546.||2,581,269.42||
|||118,723.07|||118,723.07||27.25%|
|developme|35||42|35||||
|nt Co.,||||||||
|Ltd.||||||||
|Saipan|1,834,244.||1,922,676.|1,834,244.||1,922,676.32||
|||88,431.70|||88,431.70||30.00%|
|Project|62||32|62||||
||16,871,786||17,082,853|16,871,786||17,082,853.99||
|Total||211,067.39|||211,067.39||--|
||.60||.99|.60||||

(4) Changes in Depreciation of Available-for-sale Financial Assets during the Reporting Period
Unit: RMB
|||||
|-|-|-|-|
||Available-for-sale equity|Available-for-sale debt||
|Category|||Total|
||instruments|instruments||
|Withdrawn impairment||||
|balance at the|16,871,786.60||16,871,786.60|
|period-begin||||
|Withdrawal in the||||
||211,067.39||211,067.39|
|Reporting Period||||
|Withdrawn impairment||||
||17,082,853.99||17,082,853.99|
|balance at the period-end||||

(5) Notes to the Available-for-sale Equity Instrument with Serious Fall or Non-transient Fall in Ending Fair Value but without Provisions for Impairment
Unit: RMB
||||||||
|-|-|-|-|-|-|-|
|Item of||||Duration offalling (month)|||
||||Falling scope of||Withdrawn|Reason for not|
|available-for-sale|||||||
||Investment cost|Ending fair value|fair value against||impairment|withdrawing the|
|equity|||||||
||||the cost||amount|impairment|
|instruments|||||||

Other notes
Note: The available-for-sale financial assets measured in fair value held by the Company were based on the final execution of The Reorganization Plan of Gintian Industry (Group) Co., Ltd, the Company received 772,717 tradable A shares, 412,123 non-tradable A shares and 447,217 B shares distributed by Gintian Industry on 26 January 2016, received 163,488 tradable A shares, 83,239 non-tradable A shares and 92,238 B shares additionally distributed on 15 March 2017. The cost of available-for-sale financial assets was recognized based on the price issued on the last trading date before the trading suspension of Gintian Industry (10 December 2014), RMB2.09 per A share andUS$0.17 per B share.
The changes in long-term equity investment in Macao Huashen Enterprise Co., Ltd., Saipan Project and Chongqing Guangfa Real
Estate Development Co., Ltd. and changes in depreciation reserves during the Reporting Period were caused by translation of foreign
currency statements.
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 12. Held-to-maturity Investments
(1) List of Held-to-maturity Investments
Unit: RMB
||||||||
|-|-|-|-|-|-|-|
||Ending balance|||Beginning balance|||
|Item||Depreciation|||Depreciation||
||Carrying amount||Carrying value|Carrying amount||Carrying value|
|||reserves|||reserves||

(2) Significant Held-to-maturity Investments at the Period-end
Unit: RMB
||||||
|-|-|-|-|-|
|Item|Par value|Coupon rate|Actual interest rate|Due date|

 (3) Re-classified Held-to-maturity Investments during the Reporting Period
Not applicable
Other notes
Not applicable
13. Long-term Receivables
(1) List of Long-term Receivables
Unit: RMB
|||||||||
|-|-|-|-|-|-|-|-|
||Ending balance|||Beginning balance||||
||||||||Interval of|
|Item|Carrying|Bad debtprovision||Carrying|Bad debt|||
||||Carrying value|||Carrying value|discount rate|
||amount|||amount|provision|||

(2) Derecogniziton of Long-term Receivables due to the Transfer of Financial Assets
Not applicable
(3) The Amount of the Assets and Liabilities Formed due to the Transfer and the Continued Involvement of Long-term Receivables
Not applicable
Other notes
Not applicable
14. Long-term Equity Investments
Unit: RMB
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
|||Increase/decrease||||||||||
||||||||||||Ending|
|||||Gains and|Adjustme|||||||
||||||||Cash|Withdraw|||balance|
|||Additiona||losses|nt of|||||||
||Beginnin||Reduced|||Changes|bonus or|al of||Ending|of|
|Investees||||||||||||
|||l||recognize|other|||||||
||g balance||investmen|||of other|profits|depreciati|Other|balance|depreciati|
|||investmen||d under|comprehe|||||||
||||t|||equity|announce|on|||on|
|||t||the equity|nsive|||||||
||||||||d to issue|reserves|||reserves|
|||||method|income|||||||
|I. Joint ventures||||||||||||
|Jifa||||||||||||
|Warehous|33,498,61|||605,227.6||||||34,103,84||
|e Co.,|2.76|||4||||||0.40||
|Ltd.||||||||||||
|Shenzhen||||||||||||
|Tian‘an||||||||||||
|Internatio||||||||||||
|nal||||||||||||
||5,231,780|||663,662.6||||||5,895,442||
|Building||||||||||||
||.20|||4||||||.84||
|Property||||||||||||
|Managem||||||||||||
|ent Co.,||||||||||||
|Ltd.||||||||||||
||38,730,39|||1,268,890||||||39,999,28||
|Subtotal||||||||||||
||2.96|||.28||||||3.24||
|II. Associated enterprises||||||||||||
|Shenzhen||||||||||||
|Wufang||||||||||||
|Pottery &|18,983,61|||||||||18,983,61|18,983,61|
|Porcelain|4.14|||||||||4.14|4.14|
|Industrial||||||||||||
|Co., Ltd.||||||||||||
||18,983,61|||||||||18,983,61|18,983,61|
|Subtotal||||||||||||
||4.14|||||||||4.14|4.14|
||57,714,00|||1,268,890||||||58,982,89|18,983,61|
|Total||||||||||||
||7.10|||.28||||||7.38|4.14|

Other notes
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 15. Investment Property
(1) Investment Property Adopting the Cost Measurement Mode
√ Applicable□ Not applicable
Unit: RMB
||||||
|-|-|-|-|-|
|Item|Houses and buildings|Land use right|Construction in progress|Total|
|I. Original carrying value|||||
|1. Beginning balance|682,062,541.24|3,885,469.40||685,948,010.64|
|2. Increased amount of|||||
||10,554,632.04|||10,554,632.04|
|the period|||||
|(1) Outsourcing|||||
|(2) Transfer from|||||
|inventory\fixed|||||
||9,998,266.97|||9,998,266.97|
|assets\construction in|||||
|progress|||||
|(3) Enterprise|||||
|combination increase|||||
|(4) Influence of the|||||
|translation of foreign|||||
||556,365.07|||556,365.07|
|currency denominated|||||
|financial statements|||||
|3. Decreased amount of|||||
||18,707,710.55|||18,707,710.55|
|the period|||||
|(1) Disposal|||||
|(2) Other transfer|18,707,710.55|||18,707,710.55|
|4. Ending balance|673,909,462.73|3,885,469.40||677,794,932.13|
|II. Accumulative|||||
|depreciation and|||||
|accumulative|||||
|amortization|||||
|1. Beginning balance|255,751,372.33|3,347,080.26||259,098,452.59|
|2. Increased amount of|||||
||23,695,879.13|373,005.12||24,068,884.25|
|the period|||||
|(1) Withdrawal or|||||
||23,695,879.13|373,005.12||24,068,884.25|
|amortization|||||
|3. Decreased amount of|5,923,094.61|||5,923,094.61|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||
|-|-|-|-|
|the period||||
|(1) Disposal||||
|(2) Other transfer|5,923,094.61||5,923,094.61|
|4. Ending balance|273,524,156.85|3,720,085.38|277,244,242.23|
|III. Depreciation reserves||||
|1. Beginning balance||||
|2. Increased amount of||||
|the period||||
|(1) Withdrawal||||
|3. Decreased amount of||||
|the period||||
|(1) Disposal||||
|(2) Other transfer||||
|4. Ending balance||||
|IV. Carrying value||||
|1. Ending carrying value|400,385,305.88|165,384.02|400,550,689.90|
|2. Beginning carrying|||426,849,558.05|
||426,311,168.91|538,389.14||
|value||||

(2) Investment Property Adopting the Fair Value Measurement Mode
□ Applicable√ Not applicable
The Company needs to comply with the disclosure requirements of Guideline No. 3 of the Shenzhen Stock Exchange on the Industrial Information Disclosure about ListedCompanies’ Engagement in Real Estate Business
Investment properties measured in fair value by project disclosure:
Unit: RMB
|||||||||
|-|-|-|-|-|-|-|-|
||||Lease|||||
||Geographi||income||||Reason for fair value|
|||Building||Beginning||Range of fair||
|Name of project|cal||during this||Ending fair value||changes and report|
|||area||fair value||value changes||
||location||Reporting||||index|
||||Period|||||

Whether the Company has new investment properties measured in fair value
□ Yes√ No
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 (3) Investment Property Failed to Accomplish Certification of Property
Unit: RMB
||||
|-|-|-|
|Item|Carrying value|Reason|

Other notes
None
16. Fixed Assets
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|
|Fixed assets|32,612,592.40|29,346,901.33|
|Total|32,612,592.40|29,346,901.33|

 (1) List of Fixed Assets
Unit: RMB
|||||||
|-|-|-|-|-|-|
|||Transportation|Electronic|||
||Houses and|||Decoration of the||
|Item||equipment|equipment and||Total|
||buildings|||fixed assets||
||||others|||
|I. Original carrying||||||
|value||||||
|1. Beginning balance|92,775,910.74|9,058,794.34|15,771,409.46|4,163,727.48|121,769,842.02|
|2. Increased amount||||||
||6,953,263.39|3,374,107.40|2,722,242.78||13,049,613.57|
|of the period||||||
|(1) Purchase||3,374,107.40|2,722,242.78||6,096,350.18|
|(2) Transfer from||||||
|construction in||||||
|progress||||||
|(3) Enterprise||||||
|combination increase||||||
|(4) Influence of the||||||
|translation of foreign||||||
|currency|257,476.50||||257,476.50|
|denominated||||||
|financial statements||||||
|(5) Transfer of||||||
|investment|6,695,786.89||||6,695,786.89|
|properties||||||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||||
|-|-|-|-|-|-|
|3. Decreased amount||||||
|||2,782,085.00|1,063,185.59||3,845,270.59|
|of the period||||||
|(1) Disposal or Scrap||2,782,085.00|1,063,185.59||3,845,270.59|
|4. Ending balance|99,729,174.13|9,650,816.74|17,430,466.65|4,163,727.48|130,974,185.00|
|II. Accumulative||||||
|depreciation||||||
|1. Beginning balance|69,068,851.85|7,460,443.52|11,948,746.10|3,869,182.06|92,347,223.53|
|2. Increased amount||||||
||7,353,945.74|811,728.33|1,208,545.61|201,569.37|9,575,789.05|
|of the period||||||
|(1) Withdrawal|2,048,913.53|811,728.33|1,208,545.61|201,569.37|4,270,756.84|
|(2) Transfer of||||||
|investment|5,305,032.21||||5,305,032.21|
|properties||||||
|3. Decreased amount||||||
|||2,642,980.75|994,156.39||3,637,137.14|
|of the period||||||
|(1) Disposal or Scrap||2,642,980.75|994,156.39||3,637,137.14|
|4. Ending balance|76,422,797.59|5,629,191.10|12,163,135.32|4,070,751.43|98,285,875.44|
|III. Depreciation||||||
|reserves||||||
|1. Beginning balance|||75,717.16||75,717.16|
|2. Increased amount||||||
|of the period||||||
|(1) Withdrawal||||||
|3. Decreased amount||||||
|of the period||||||
|(1) Disposal or Scrap||||||
|4. Ending balance|||75,717.16||75,717.16|
|IV. Carrying value||||||
|1. Ending carrying||||||
||23,306,376.54|4,021,625.64|5,191,614.17|92,976.05|32,612,592.40|
|value||||||
|2. Beginning||||||
||23,707,058.89|1,598,350.82|3,746,946.20|294,545.42|29,346,901.33|
|carrying value||||||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 (2) List of Temporarily Idle Fixed Assets
Unit: RMB
|||||||
|-|-|-|-|-|-|
||Original carrying|Accumulative|Depreciation|||
|Item||||Carrying value|Note|
||value|depreciation|reserves|||
|Houses and||||||
||4,059,207.77|2,522,507.21||1,536,700.56||
|buildings||||||

(3) Fixed Assets Leased in by Financing Lease
Unit: RMB
||||||
|-|-|-|-|-|
|||Accumulative|||
|Item|Original carrying value||Depreciation reserves|Carrying value|
|||depreciation|||

(4) Fixed Assets Leased out by Operation Lease
Unit: RMB
|||
|-|-|
|Item|Ending carrying value|

(5) Fixed Assets Failed to Accomplish Certification of Property
Unit: RMB
||||
|-|-|-|
|Item|Carrying value|Reason|

Other notes
Not applicable
(6) Proceeds from Disposal of Fixed Assets
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|

Other notes
Not applicable
17. Construction in Progress
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|

(1) List of Construction in Progress
Unit: RMB
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||||||
|-|-|-|-|-|-|-|
||Ending balance|||Beginning balance|||
|Item||Depreciation|||Depreciation|Carrying value|
||Carrying amount||Carrying value|Carrying amount|||
|||reserves|||reserves||

(2) Changes in Significant Construction in Progress during the Reporting Period
Unit: RMB
||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|
|||||||||||Ofwhich:amountofcapitalizedinterestsfor theReporting Period|||
||||||||Proportion ofaccumulatedinvestment inconstructions tobudget||||||
||||||||||Accumul||Capitaliz||
||||||||||ated||ation rate||
|||||Transferr|||||||||
|||Beginnin|||Other||||amount||of||
||||Increased amount|ed in||Ending||Job||||Capital|
|Item|Budget|g|||decrease||||of||interests||
|||||fixed||balance||schedule||||resources|
|||balance|||d amount||||interest||for the||
|||||assets|||||||||
||||||||||capitaliz||Reportin||
||||||||||ation||g Period||

(3) List of the Withdrawal of the Depreciation Reserves for Construction in Progress
Unit: RMB
||||
|-|-|-|
|Item|Amount withdrawn|Reason for withdrawal|

Other notes
Not applicable
(4) Engineering Materials
Unit: RMB
||||||||
|-|-|-|-|-|-|-|
||Ending balance|||Beginning balance|||
|Item||Depreciation||Carryingamount|Depreciation||
||Carrying amount||Carrying value|||Carrying value|
|||reserves|||reserves||

Othernotes：
Not applicable
18. Productive Living Assets
(1) Productive Living Assets Adopting Cost Measurement Mode
□ Applicable√ Not applicable
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 (2) Productive Living Assets Adopting Fair Value Measurement Mode
□ Applicable√ Not applicable
19. Oil and Gas Assets
□ Applicable√ Not applicable
20. Intangible Assets
(1) List of Intangible Assets
Unit: RMB
||||||
|-|-|-|-|-|
|Item|Land use right|Patent right|Non-patent right|Total|
|I. Original carrying|||||
|value|||||
|1. Beginning balance|||||
|2. Increased amount|||||
|of the period|||||
|(1) Purchase|||||
|(2) Internal R&D|||||
|(3) Business|||||
|combination increase|||||
|3. Decreased amount|||||
|of the period|||||
|(1) Disposal|||||
|4. Ending balance|||||
|II. Accumulated|||||
|amortization|||||
|1. Beginning balance|||||
|2. Increased amount|||||
|of the period|||||
|(1) Withdrawal|||||
|3. Decreased amount|||||
|of the period|||||
|(1) Disposal|||||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||
|-|
|4. Ending balance|
|III. Depreciation|
|reserves|
|1. Beginning balance|
|2. Increased amount|
|of the period|
|(1) Withdrawal|
|3. Decreased amount|
|of the period|
|(1) Disposal|
|4. Ending balance|
|IV. Carrying value|
|1. Ending carrying|
|value|
|2. Beginning|
|carrying value|

The proportion of intangible assets formed from the internalR&D of the Company at the Period-end to the ending balance of intangible assets was.
(2) Land Use Right with Certificate of Title Uncompleted
Unit: RMB
||||
|-|-|-|
|Item|Carrying value|Reason|

Othernotes：
Not applicable
21.R&D Expense
Unit: RMB
||||||
|-|-|-|-|-|
||Beginning|||Ending|
|Item||Increase|Decrease||
||balance|||balance|

 Other notes
Not applicable
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 22. Goodwill
(1) Original Carrying Value of Goodwill
Unit: RMB
||||||
|-|-|-|-|-|
|Name of the|||||
|invested units or|Beginning||||
|||Increase|Decrease|Ending balance|
|events generating|balance||||
|goodwill|||||

(2) Depreciation Reserves of Goodwill
Unit: RMB
||||||
|-|-|-|-|-|
|Name of the|||||
|invested units or|Beginning||||
|||Increase|Decrease|Ending balance|
|events generating|balance||||
|goodwill|||||

Information on the assets group or combination of assets groups which goodwill belongs to
Not applicable
Notes of the testing process of goodwill impairment, parameters (such as growth rate of the forecast period, growth rate of stable period, rate of profit, discount rate, forecast period and so on for prediction of future present value of cash flows) and the recognition method of goodwill impairment losses:
Not applicable
Influence of goodwill impairment testing
Not applicable
Other notes
Not applicable
23. Long-term Prepaid Expense
Unit: RMB
|||||||
|-|-|-|-|-|-|
||||Amortization|Other decreased||
|Item|Beginning balance|Increased amount|||Ending balance|
||||amount of the period|amount||
|Facilities||||||
|reconstruction|951,368.85|1,084,305.07|228,935.63||1,806,738.29|
|expenses||||||
|Rental fees||998,070.00|406,232.00||591,838.00|
|Total|951,368.85|2,082,375.07|635,167.63||2,398,576.29|

Other notes
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 24. Deferred Income Tax Assets/Deferred Income Tax Liabilities
(1) Deferred Income Tax Assets that Had not Been Set-off
Unit: RMB
||||||
|-|-|-|-|-|
||Ending balance||Beginning balance||
|Item|Deductible temporary|Deferred income tax|Deductible temporary|Deferred income tax|
||difference|assets|difference|assets|
|Provision for impairment|||||
||126,743,538.44|31,553,045.99|127,814,574.78|31,824,813.21|
|of assets|||||
|Internal unrealized profit|52,189,819.68|13,047,454.92|50,232,811.52|12,558,202.88|
|Deductible losses|657,498,958.12|164,374,739.53|325,096,396.59|81,274,099.15|
|Accrued land VAT|1,204,912,500.44|301,228,125.11|1,048,229,108.99|262,057,277.25|
|Estimated profit|||||
|calculated at pre-sale|||||
||38,294,088.60|9,573,522.15|1,158,823.50|289,705.88|
|revenue of property|||||
|enterprises|||||
|Payroll payable unpaid|||||
||26,575.76|6,643.94|71,997.16|17,999.27|
|but withdrawn|||||
|Total|2,079,665,481.04|519,783,531.64|1,552,603,712.54|388,022,097.64|

 (2) Deferred Income Tax Liabilities Had Not Been Off-set
Unit: RMB
||||||
|-|-|-|-|-|
||Ending balance||Beginning balance||
|Item|Deductible temporary|Deferred income tax|Deductible temporary|Deferred income tax|
||difference|liabilities|difference|liabilities|
|The carrying value of|||||
|fixed assets was larger|21,102.40|5,275.60|34,664.60|8,668.15|
|than the tax basis|||||
|Total|21,102.40|5,275.60|34,664.60|8,668.15|

 (3) Deferred Income Tax Assets or Liabilities Listed by Net Amount after Off-set
Unit: RMB
||||||
|-|-|-|-|-|
||Mutual set-off amount of|Ending balance of|Mutual set-off amount of|Beginning balance of|
||deferred income tax|deferred income tax|deferred income tax|deferred income tax|
|Item|||||
||assets and liabilities at|assets or liabilities after|assets and liabilities at|assets or liabilities after|
||the period-end|off-set|the period-begin|off-set|
|Deferred income tax||519,783,531.64||388,022,097.64|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||
|-|-|-|
|assets|||
|Deferred income tax|5,275.60|8,668.15|
|liabilities|||

(4) List of Unrecognized Deferred Income Tax Assets
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|
|Deductible losses|116,064,336.25|264,391,115.35|
|Estimated profit calculated at pre-sale|||
||2,535,696.30|72,335,705.85|
|revenue of property enterprises|||
|Internal unrealized profit|2,427,381.29|15,134,932.80|
|Provision for assets impairment|212,156,220.23|241,361,068.56|
|Total|333,183,634.07|593,222,822.56|

 (5) Deductible Losses of Unrecognized Deferred Income Tax Assets will Due in the Following Years Unit: RMB
|||||
|-|-|-|-|
|Years|Ending amount|Beginning amount|Notes|
|Y2018||8,320,354.75|The deductible losses of 2013|
|Y2019|7,443.23|4,766,878.24|The deductible losses of 2014|
|Y2020|2,221,261.56|4,461,538.13|The deductible losses of 2015|
|Y2021|5,397,820.20|6,158,740.02|The deductible losses of 2016|
|Y2022|108,437,811.26|240,683,604.21|The deductible losses of 2017|
|Y2023|||The deductible losses of 2018|
|Total|116,064,336.25|264,391,115.35|--|

Othernotes：
None
25. Other Non-current Assets
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|
|Prepayment for purchase of fixed assets,|||
||8,971,942.00||
|investment properties and intangible assets|||
|Prepayment for acquisition of long-term|||
||100,000,000.00||
|equity investment|||
|Total|108,971,942.00||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Othernotes：
Note: On 11 August 2018, the Company signed the framework agreement with Shenzhen Xinhai Rongyao Real Estate Development Co., Ltd. to purchase69% of shares in Shenzhen Rongyao Real Estate Development Co., Ltd., the subsidiary of Shenzhen Xinhai Rongyao Real Estate Development Co., Ltd. As stipulated in the agreement, the Company shall pay a subscription of RMB0.1 billion and that subscription will be deducted from the transaction consideration as one part of transfer money for shares after signing the formal transaction document.
26. Short-term Borrowings
(1) Category of Short-term Borrowings
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|

Notes of short-term borrowings category:
Not applicable
(2) List of the Short-term Borrowings Overdue but Not Returned
The amount of the overdue unpaid short-term borrowings at the period-end was of RMBXXX, of which the significant overdue unpaid short-term borrowings are as follows:
Unit: RMB
||||||
|-|-|-|-|-|
|Borrower|Ending balance|Interest rate|Overdue time|Overdue charge rate|

 Othernotes：
Not applicable
27. Financial Liabilities at Fair Value through Profit or Loss
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|

Othernotes：
Not applicable
28. Derivative Financial Liabilities
□ Applicable√ Not applicable
29. Notes Payable and Accounts Payable
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|
|Accounts payable|398,429,855.96|491,963,303.62|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||
|-|-|-|
|Total|398,429,855.96|491,963,303.62|

 (1) Notes Payable Listed by Category
Unit: RMB
||||
|-|-|-|
|Category|Ending balance|Beginning balance|

The total amount of the due but not paid notes payable at the end of the period was of RMBXXX.
(2) List of Accounts Payable
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|
|Within 1 year|129,232,449.39|210,969,598.73|
|1 to 2 years|203,704,187.53|197,803,229.69|
|2 to 3 years|13,191,433.56|17,921,262.66|
|Over 3 years|52,301,785.48|65,269,212.54|
|Total|398,429,855.96|491,963,303.62|

 (3) Significant Accounts Payable Aging over One Year
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Unpaid/ Un-carry-over reason|
|The Second Construction Co., Ltd. of|||
|China Construction Third Engineering|81,258,600.00|Unsettled|
|Bureau|||
|Jinchen Group Limited Company|50,634,299.28|Unsettled|
|Jiangsu Hanjian Group Co.,Ltd.|32,324,917.24|Unsettled|
|Shenzhen Luohu District Land and|||
||25,000,000.00|Unsettled|
|Resources Bureau|||
|Henan First Construction Engineering|||
||14,028,734.51|Unsettled|
|Group Co., Ltd.|||
|Total|203,246,551.03|--|

Othernotes：
There were no accounts payable for any related parties or shareholding entities holding shares of the Company with over5% (including5%) of voting rights in the accounts payable for the Reporting Period.
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 30. Advances from Customers
(1) List of Advances from Customers
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|
|Within 1 year|262,553,420.13|278,516,155.14|
|1-2 years|2,031,091.19|236,833,304.63|
|2-3 years|510,000.00|898,707.77|
|Over 3 years|243,704.02|736,543.57|
|Total|265,338,215.34|516,984,711.11|

 (2) Significant Advances from Customers Aging over One Year
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Unpaid/ Un-carry-over reason|

 (3) Settled but Uncompleted Projects Formed by Construction Contracts at the Period-end
Unit: RMB
|||
|-|-|
|Item|Amount|

Othernotes：
There were no advances from any related parties or shareholding entities holding shares of the Company with over5% (including5%) of voting rights in the advances from customers for the Reporting Period.
The advances from customers aging over one year were mainly the advances from home buyers without obtaining their homes yet. The Company is required to comply with the disclosure requirements stipulated in Shenzhen Stock Exchange Industry Information Disclosure Guidelines No. 3-Listed Company Engaged in Property Development
Prepayment of the top 5 sale of real estate projects:
Unit: RMB
|||||||
|-|-|-|-|-|-|
|||||Estimate finished||
|No.|Item|Beginning balance|Ending balance||Presale proportion|
|||||time||
||SZPRD-Golden|||||
|1||0.00|89,772,140.00|30 April 2019|2.63%|
||Collar‘s Resort|||||
||SZPRD –Qianhai|||||
|2||4,981,735.00|75,538,532.00|30 October 2016|92.69%|
||Gangwan|||||
||SZPRD –Songhu|||||
|3||604,765.00|51,299,542.00|31 July 2017|96.34%|
||Langyuan|||||
||SZPRD –Hupan|||||
|4||455,923,289.00|8,687,567.00|30 November 2017|73.36%|
||Yujing II|||||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||||
|-|-|-|-|-|-|
||SZPRD –Banshan|||||
|5||18,346,748.00|6,222,099.00|30 November 2016|91.78%|
||Yujing I|||||

31. Payroll Payable
(1) List of Payroll Payable
Unit: RMB
||||||
|-|-|-|-|-|
|Item|Beginning balance|Increase|Decrease|Ending balance|
|I. Short-term salary|91,496,562.39|348,224,773.29|344,137,746.24|95,583,589.44|
|II. Post-employment|||||
|benefit-defined|477,112.15|27,282,419.99|27,273,600.04|485,932.10|
|contribution plans|||||
|III. Termination benefits|92,800.00|2,929,719.63|3,022,519.63||
|IV. Current portion of|||||
|||49,569.54|49,569.54||
|other welfares|||||
|Total|92,066,474.54|378,486,482.45|374,483,435.45|96,069,521.54|

 (2) List of Short-term Salary
Unit: RMB
||||||
|-|-|-|-|-|
|Item|Beginning balance|Increase|Decrease|Ending balance|
|1. Salary, bonus,|||||
||83,449,073.72|303,400,997.89|300,819,367.28|86,030,704.33|
|allowance, subsidy|||||
|2. Employee welfare||14,248,642.80|14,248,612.80|30.00|
|3. Social insurance|254.95|11,198,952.30|11,199,207.25||
|Of which: Medical|||||
|||9,937,506.45|9,937,506.45||
|insurance premiums|||||
|Work-re|||||
|||544,251.87|544,251.87||
|lated injury insurance|||||
|Materni|||||
||254.95|676,743.93|676,998.88||
|ty insurance|||||
|Other social security|||||
|||40,450.05|40,450.05||
|charges|||||
|4. Housing fund|504,216.12|8,654,244.64|8,675,162.21|483,298.55|
|5. Labor union budget|||||
|and employee education|7,543,017.60|8,643,309.69|7,116,770.73|9,069,556.56|
|budget|||||
|8. Other short-term||2,078,625.97|2,078,625.97||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||||
|-|-|-|-|-|
|salary|||||
|Total|91,496,562.39|348,224,773.29|344,137,746.24|95,583,589.44|

 (3) List of Defined Contribution Plans
Unit: RMB
||||||
|-|-|-|-|-|
|Item|Beginning balance|Increase|Decrease|Ending balance|
|1. Basic pension benefits|477,112.15|22,433,456.77|22,424,636.82|485,932.10|
|2. Unemployment|||||
|||664,978.33|664,978.33||
|insurance|||||
|3. Annuity||4,183,984.89|4,183,984.89||
|Total|477,112.15|27,282,419.99|27,273,600.04|485,932.10|

 Othernotes：
The Company, in line with the requirement, participate the endowment insurance, unemployment insurance scheme and so on, according to the scheme, the Company monthly pay to the scheme in line with14% and1% of the endowment insurance base, except the monthly payment, the Company no longer shoulder the further payment obligation, the relevant expense occurred was recorded into current profits and losses or related assets costs.
32. Taxes Payable
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|
|VAT|43,456,567.41|6,311,231.88|
|Corporate income tax|299,844,086.29|135,064,846.34|
|Personal income tax|727,690.79|829,379.86|
|Urban maintenance and construction tax|2,041,413.19|317,880.65|
|Stamp tax|11,902.61|36,803.91|
|Education Surcharge|893,767.33|144,949.71|
|Local education surtax|603,356.32|105,286.00|
|Land VAT|1,205,033,788.57|1,048,229,108.99|
|Property tax|48,545.74|1,097,050.21|
|Other|59,512.34|450,719.11|
|Total|1,552,720,630.59|1,192,587,256.66|

 Othernotes：
33. Other Payables
Unit: RMB
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||
|-|-|-|
|Item|Ending balance|Beginning balance|
|Interest payable|1,669.10||
|Dividends payable|29,642.40|29,642.40|
|Other payables|112,470,835.19|122,592,357.98|
|Total|112,502,146.69|122,622,000.38|

 (1) Interest Payable
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|
|Interest of long-term borrowings with|||
|installment payments of interest and|1,669.10||
|payment of principal at maturity|||
|Total|1,669.10||

List of the significant overdue unpaid interest:
Unit: RMB
||||
|-|-|-|
|Borrower|Overdue amount|Overdue reasons|

Othernotes：
Not applicable
(2) Dividends Payable
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|
|Ordinary share dividends|29,642.40|29,642.40|
|Total|29,642.40|29,642.40|

 Other notes, including significant dividends payable unpaid for over one year, the unpaid reason shall be disclosed:
|||||
|-|-|-|-|
|Name|Shares|Amount of dividendspayable|Note|
|Shenzhen South China InvestmentDevelopment Co., Ltd.|54,840.00|9,871.20|Without access to itsaccount|
|Wenling Quality Control Association|54,839.00|9,871.02|Without access to itsaccount|
|Shanghai Weihong Industry & Trade Co., Ltd.|55,000.00|9,900.00|Without access to itsaccount|
|China Shenzhen International Cooperation(Group) Co., Ltd.|1.00|0.18|Without access to itsaccount|
|Total|164,680.00|29,642.40||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Note: On 21 April 2017, the Company reviewed and approved the Proposal on 2016 Profit Distribution Plan and Bonus Issue from Capital Reserves on the 2016 Annual General Meeting and decided to distribute the dividends to all shareholders at RMB1.80 per ten shares in cash based on the total 595,979,092 shares of share capital. As of the end of the Reporting Period, there was still four shareholders who could not be distributed their dividends due to no access to their effective accounts.
(3) Other Payables
1) Other Payables Listed by Nature
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|
|Guarantee deposit|25,366,966.93|23,563,482.44|
|Cash deposit|10,150,566.03|10,920,996.03|
|Agency fund|26,902,808.40|35,176,474.28|
|Intercourse fund|35,881,368.64|34,481,368.64|
|Accrued expenses|4,641,226.43|7,057,227.97|
|Payment on behalf|4,410,942.10|394,048.71|
|Other|5,116,956.66|10,998,759.91|
|Total|112,470,835.19|122,592,357.98|

 2) Significant Other Payables Aging over One Year
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Unpaid/Un-carry-over reason|
|||Come-and-go accounts without specific|
|Shenzhen Jifa Warehouse Co., Ltd.|26,296,665.14||
|||payment term|
|Shenzhen Tian‘an International Building||Come-and-go accounts without specific|
||5,214,345.90||
|Property Management Co., Ltd.||payment term|
|Margin of sporadic lease|6,747,724.03|Margin within the leasing period|
|Rainbow Co., Ltd.|2,380,000.00|Margin within the leasing period|
|Shenzhen Branch of CPIC|1,022,842.00|Margin within the leasing period|
|Total|41,661,577.07|--|

Other notes
None
34. Held-for-sale Liabilities
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|

Othernotes：
Not applicable
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 35. Current Portion of Non-current Liabilities
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|

Othernotes：
Not applicable
36. Other Current Liabilities
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|

Increase/decrease of the short-term bonds payable:
Unit: RMB
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
|||||||||Amortizat|||
||||||||Withdraw||||
|||||||||ion of|Repayme||
|||||||The|al of||||
|Bonds||Issuing||Issuing|Beginnin|||premium|nt in the|Ending|
||Par value||Duration|||current|interest||||
|name||date||amount|g balance|||and|Reporting|balance|
|||||||issue|by par||||
|||||||||depreciati|Period||
||||||||value||||
|||||||||on|||

Othernotes：
Not applicable
37. Long-term Borrowings
(1) Category of Long-term Borrowings
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|
|Guaranteed borrowings|1,000,000.00||
|Total|1,000,000.00||

Notes to the category of long-term borrowings:
Other notes, including the interval of interest rate:
|||||||
|-|-|-|-|-|-|
|Bank providing loan|Borrowings|Borrowings|Interestrate (%)|Currency||
||Start date|End date|||Foreigncurrencyamount|
|Shenzhen Branch of Bankof Shanghai Co., Ltd.|20 July 2018|20 June 2021|5.4625|RMB|--|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 38. Bonds Payable
(1) List of Bonds Payable
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|

(2) Increase/Decrease of Bonds Payable (Excluding Other Financial Instrument Classified as Financial Liabilities such as Preferred Shares and Perpetual Bonds)
Unit: RMB (3) Notes to the Conditions and Time of the Shares Transfer of the Convertible Corporate Bonds
(4) Notes to Other Financial Instruments Classified as Financial Liabilities
Basic situation of other financial instruments such as preferred shares and perpetual bonds outstanding at the period-end
Changes in financial instruments such as preferred shares and perpetual bonds outstanding at the period-end
Unit: RMB
||||||||||
|-|-|-|-|-|-|-|-|-|
|Outstanding|Period-beginning||Increase||Decrease||Period-end||
|financial||Carrying||Carrying||Carrying||Carrying|
||Amount||Amount||Amount||Amount||
|instrument||value||value||value||value|

 Notes to basis for the classification of other financial instruments as financial liabilities
Other notes
Not applicable
39. Long-term Payables
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|

(1) Long-term Payables Listed by Nature
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|

Othernotes：
(2) Specific Payables
Unit: RMB
|||||||
|-|-|-|-|-|-|
|Item|Beginning balance|Increase|Decrease|Ending balance|Reason for|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||
|-|
|formation|

 Othernotes：
Not applicable
40. Long-term Payroll Payable
(1) List of Long-term Payroll Payable
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|

(2) Changes in Defined Benefit Plans
Obligation present value of defined benefit plans:
Unit: RMB
||||
|-|-|-|
|Item|Reporting period|Same period of last year|

Plan assets:
Unit: RMB
||||
|-|-|-|
|Item|Reporting period|Same period of last year|

Net liabilities (net assets) of defined benefit plans:
Unit: RMB
||||
|-|-|-|
|Item|Reporting period|Same period of last year|

Notes of influence of content of defined benefit plans and its relevant risks to the future cash flow, time and uncertainty of the Company:
Notes to the results of significant actuarial assumptions and sensitivity analysis of defined benefit plans:
Othernotes：
Not applicable
41. Provisions
Unit: RMB
|||||
|-|-|-|-|
|Item|Ending balance|Beginning balance|Reason for formation|

 Other notes, including notes to related significant assumptions and evaluation of significant provisions:
Not applicable
42. Deferred Income
Unit: RMB
|||||||
|-|-|-|-|-|-|
||||||Reason for|
|Item|Beginning balance|Increase|Decrease|Ending balance||
||||||formation|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Item involving government subsidies:
Unit: RMB
||||||||||
|-|-|-|-|-|-|-|-|-|
||||Amount|Amount|||||
||||recorded into|recorded into|Amount||||
|||Amount of||||||Related to|
||Beginning||non-operatin|other income|offset cost in|Other|Ending||
|Item||newly||||||assets/related|
||balance||g income in|in the|the Reporting|changes|balance||
|||subsidy||||||income|
||||the Reporting|Reporting|Period||||
||||Period|Period|||||

Othernotes：
Not applicable
43. Other Non-current Liabilities
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|
|Utility specific fund|237,163.63|237,163.63|
|Housing principle fund|11,702,533.73|14,107,346.01|
|House warming deposit|6,649,884.71|7,220,523.83|
|Electric Equipment Maintenance fund|4,019,415.44|4,019,415.44|
|Deputed Maintenance fund|28,374,344.95|27,687,597.11|
|Other|1,953,838.35|1,271,207.25|
|Total|52,937,180.81|54,543,253.27|

 Othernotes：
None
44. Share Capital
Unit: RMB
|||||||||
|-|-|-|-|-|-|-|-|
|||Increase/decrease (+/-)||||||
||Beginning|||||||
|||New shares||Bonus issue|||Ending balance|
||balance||Bonus shares||Other|Subtotal||
|||issued||from profit||||
|The sum of|595,979,092.00||||||595,979,092.00|
|shares||||||||

Othernotes：
None
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 45. Other Equity Instruments
(1) The Basic Information of Other Financial Instruments such as Preferred Stock and Perpetual Bond Outstanding at the End of the Period
Not applicable
(2) Changes in Financial Instruments such as Preferred Stock and Perpetual Bond Outstanding at the End of the Period
Unit: RMB
||||||||||
|-|-|-|-|-|-|-|-|-|
|Outstanding|Period-beginning||Increase||Decrease||Period-end||
|financial||Carrying||Carrying||Carrying||Carrying|
||Amount||Amount||Amount||Amount||
|instruments||value||value||value||value|

 The current changes in other equity instruments and the corresponding reasons and the basis of the relevant accounting treatment Not applicable
Othernotes：
Not applicable
46. Capital Reserves
Unit: RMB
||||||
|-|-|-|-|-|
|Item|Beginning balance|Increase|Decrease|Ending balance|
|Capital premium|||||
||38,450,087.51|||38,450,087.51|
|(premium on stock)|||||
|Other capital reserves|80,488,045.38|||80,488,045.38|
|Total|118,938,132.89|||118,938,132.89|

 Other notes, including changes and reason of change:
None
47. Treasury Shares
Unit: RMB
||||||
|-|-|-|-|-|
|Item|Beginning balance|Increase|Decrease|Ending balance|

 Other notes, including changes and reason of change:
Not applicable
48. Other Comprehensive Income
Unit: RMB
|||||
|-|-|-|-|
|Item|Beginning|Reporting Period|Ending|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||||||
|-|-|-|-|-|-|-|-|
||balance||Less: recorded||||balance|
||||in other|||||
||||||Attributable|||
||||comprehensive|||Attributable||
|||Income|||to owners|||
||||income in|||to||
|||before||Less:|of the|||
||||prior period|||non-control||
|||taxation in||Income tax|Company|||
||||and transferred|||ling||
|||the Current||expense|as the|||
||||in profit or|||interests||
|||Period|||parent after|||
||||loss in the|||after tax||
||||||tax|||
||||Current|||||
||||Period|||||
|II. Other comprehensive income that|||||2,325,405.45|||
|||2,325,405.4|||||-1,786,18|
|may subsequently be reclassified to|-4,111,587.14|||||||
|||5|||||1.69|
|profit or loss||||||||
|Differences arising from translation|||||2,325,405.45|||
|||2,325,405.4|||||-1,786,18|
|of foreign currency-denominated|-4,111,587.14|||||||
|||5|||||1.69|
|financial statements||||||||
||-4,111,587.14|2,325,405.4|||2,325,405.45||-1,786,181.69|
|Total of other comprehensive income||||||||
|||5||||||

 Other notes, including the adjustment of the effective gain/loss on cash flow hedges to the initial recognized amount:
49. Specific Reserve
Unit: RMB
||||||
|-|-|-|-|-|
|Item|Beginning balance|Increase|Decrease|Ending balance|

 Other notes, including changes and reason of change:
Not applicable
50. Surplus Reserves
Unit: RMB
||||||
|-|-|-|-|-|
|Item|Beginning balance|Increase|Decrease|Ending balance|
|Statutory surplus|||||
||299,569,569.96|||299,569,569.96|
|reserves|||||
|Total|299,569,569.96|||299,569,569.96|

 Notes, including changes and reason of change:
In line with provisions of Corporate Law and Articles of Association, the Company withdrew10% of net profits as statutory surplus reserves. When the accumulative statutory surplus reserves reach over50% of the registered capital of the Company, no statutory surplus reserves will be withdrawn.
After the withdrawal of statutory surplus reserves, the Company can withdraw the discretionary surplus reserves which can be used
to make up for losses of previous years or increase the share capital when approved.
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 51. Retained Earnings
Unit: RMB
||||
|-|-|-|
|Item|Reporting Period|Same period of last year|
|Beginning balance of retained earnings beforeadjustments|||
||1,911,318,586.37|1,441,632,088.56|
|Beginning balance of retained earnings afteradjustments|1,911,318,586.37||
|||1,441,632,088.56|
|Add: Net profit attributable to owners of theCompany as the parent|||
||592,723,852.71|622,962,734.37|
|Less: withdrawal of statutory surplus reserves||46,000,000.00|
|Dividend of ordinary shares payable|178,793,727.60|107,276,236.56|
|Ending retained earnings|2,325,248,711.48|1,911,318,586.37|

 List of adjustment of beginning retained earnings:
(1) RMB0.00 beginning retained earnings was affected by retrospective adjustment conducted according to the Accounting Standards for Business Enterprises and relevant new regulations.
(2) RMB0.00 beginning retained earnings was affected by changes in accounting policies.
(3) RMB0.00 beginning retained earnings was affected by correction of significant accounting errors.
(4) RMB0.00 beginning retained earnings was affected by changes in combination scope arising from same control.
(5) RMB0.00 beginning retained earnings was affected totally by other adjustments.
52. Operating Revenue and Cost of Sales
Unit: RMB
||||||
|-|-|-|-|-|
||Reporting Period||Same Period of last year||
|Item|||||
||Operating revenue|Cost of sales|Operating revenue|Cost of sales|
|Main operations|2,723,996,545.39|1,294,560,011.00|2,851,768,386.62|1,609,336,288.38|
|Other operations|63,244,087.14|20,629,980.84|52,922,303.91|18,531,617.26|
|Total|2,787,240,632.53|1,315,189,991.84|2,904,690,690.53|1,627,867,905.64|

 The Company is required to comply with the disclosure requirements stipulated in Shenzhen Stock Exchange Industry Information Disclosure Guidelines No. 3-Listed Company Engaged in Property Development
The top 5 accounts received with confirmed amount in the Reporting Period:
Unit: RMB
||||
|-|-|-|
|No.|Name of project|Income balance|
|1|SZPRD-Qianhai Gangwan|1,213,469,382.80|
|2|SZPRD-Hupan Yujing II|554,867,040.56|
|3|SZPRD-Songhu Langyuan|247,296,018.72|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||
|-|-|-|
|4|SZPRD-Banshan Yujing I|122,209,577.13|
|5|SZPRD-Langqiao International|72,215,790.71|

 53. Taxes and Surtaxes
Unit: RMB
||||
|-|-|-|
|Item|Reporting Period|Same Period of last year|
|Urban maintenance and construction tax|8,542,191.66|9,234,208.58|
|Education Surcharge|3,765,265.53|4,403,393.23|
|Property tax|4,495,124.63|5,121,683.05|
|Land use tax|819,578.17|1,879,238.55|
|Business tax|1,115,668.20|68,915,815.45|
|Local education surtax|2,510,202.58|2,936,020.80|
|Land VAT|591,164,599.63|370,146,447.34|
|Other taxes|1,014,335.77|1,239,308.22|
|Total|613,426,966.17|463,876,115.22|

 Othernotes：
Refer to Note VI Taxation for details.
54. Selling Expense
Unit: RMB
||||
|-|-|-|
|Item|Reporting Period|Same Period of last year|
|Employee‘s remuneration|4,024,373.52|4,790,260.31|
|Depreciation fees|68,637.22|70,363.20|
|Advertising|11,002,256.66|1,657,379.03|
|Office expenses|1,561,813.69|1,026,676.83|
|Business entertainment fees|667,915.85|696,049.45|
|Property fees|1,031,123.17|2,768,765.78|
|Consultancy and sales service charges|3,508,647.82|6,337,866.06|
|Article of consumption|353,706.00|520,602.12|
|Amortization of low-value consumption|||
||204,838.19|91,070.68|
|goods|||
|Agency fee|19,774,323.60|11,150,853.97|
|Vacancy charge|2,634,036.79|1,261,750.31|
|Other|1,669,552.67|807,555.59|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||
|-|-|-|
|Total|46,501,225.18|31,179,193.33|

 Othernotes：
55. Administrative Expense
Unit: RMB
||||
|-|-|-|
|Item|Reporting Period|Same Period of last year|
|Employee‘s remuneration|70,389,976.43|95,553,096.76|
|Administrative office cost|21,708,292.73|21,621,558.85|
|Assets amortization and depreciation|||
||3,640,986.34|5,174,960.73|
|expense|||
|Litigation costs|155,176.40|6,374,637.65|
|Other|6,957,781.29|8,304,401.70|
|Total|102,852,213.19|137,028,655.69|

 Othernotes：
56.R&D Expense
Unit: RMB
||||
|-|-|-|
|Item|Reporting Period|Same Period of last year|

Othernotes：
Not applicable
57. Finance Costs
Unit: RMB
||||
|-|-|-|
|Item|Reporting Period|Same Period of last year|
|Interest expense|||
|Less: Interest income|58,627,284.65|25,827,011.83|
|Foreign exchange gains or losses|290,983.11|734,047.30|
|Other|756,768.97|685,508.15|
|Total|-57,579,532.57|-24,407,456.38|

 Othernotes：
58. Asset Impairment Loss
Unit: RMB
||||
|-|-|-|
|Item|Reporting Period|Same Period of last year|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||
|-|-|-|
|I. Bad debt loss|-360,322.75|3,952,731.89|
|II. Loss on inventory valuation|-6,565,809.22|-59,564,053.97|
|XIV. Other||-1,085,618.78|
|Total|-6,926,131.97|-56,696,940.86|

 Othernotes：
Other refers to losses on deprecisation of other current assets.
59. Other Income
Unit: RMB
||||
|-|-|-|
|Sources|Reporting Period|Same period of last year|

60. Investment Income
Unit: RMB
||||
|-|-|-|
|Item|Reporting Period|Same Period of last year|
|Long-term equity investment income|||
||1,268,890.28|1,978,501.84|
|accounted by equity method|||
|Investment income from disposal of long-term|||
||620,130.83|104,895,528.48|
|equity investment|||
|Total|1,889,021.11|106,874,030.32|

 Othernotes：
61. Gain on Changes in Fair Value
Unit: RMB
||||
|-|-|-|
|Sources|Reporting Period|Same period of last year|

Othernotes：
Not applicable
62. Asset Disposal Income
Unit: RMB
||||
|-|-|-|
|Sources|Reporting Period|Same period of last year|
|Gains from disposal of non-current|||
||-8,096.97|-11,772.11|
|assets(―-― means losses)|||

63. Non-operating Income
Unit: RMB
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||
|-|-|-|-|
||||Amount recorded in the current|
|Item|Reporting Period|Same Period of last year||
||||non-recurring profit or loss|
|Total income from scrap of||||
||13,571.33||13,571.33|
|non-current assets||||
|Government subsidy not related||||
||165,676.08||165,676.08|
|to routine activities of business||||
|Compensation income|929,177.65|295,947.51|929,177.65|
|Other|3,750,718.74|1,463,947.32|3,750,718.74|
|Total|4,859,143.80|1,759,894.83|4,859,143.80|

 Government subsidies recorded into current profit or loss
Unit: RMB
||||||||||
|-|-|-|-|-|-|-|-|-|
|||||Whether|||||
|||||influence the|Special|||Related to|
||Distribution|Distribution||||Reporting|Same period||
|Item|||Nature|profits or|subsidy or|||assets/related|
||entity|reason||||Period|of last year||
|||||losses of the|not|||income|
|||||year or not|||||
|Subsidy for|||||||||
|||||||||Related to|
|stabilizing||||Not|Not|165,676.08|0.00||
|||||||||income|
|posts|||||||||

Othernotes：
None
64. Non-operating Expense
Unit: RMB
|||||
|-|-|-|-|
||||Amount recorded in the current|
|Item|Reporting Period|Same Period of last year||
||||non-recurring profit or loss|
|Loss on damage and scrap of||||
||84,963.94||84,963.94|
|non-current assets||||
|Penalty and fine for delaying||||
||1,806,353.15|92,327.19|1,806,353.15|
|payment||||
|Other|1,149,525.83|7,625,422.97|1,149,525.83|
|Total|3,040,842.92|7,717,750.16|3,040,842.92|

 Othernotes：
65. Income Tax Expense
(1) List of Income Tax Expense
Unit: RMB
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||
|-|-|-|
|Item|Reporting Period|Same Period of last year|
|Current income tax expense|316,578,200.24|217,802,226.43|
|Deferred income tax expense|-131,764,826.55|-14,017,340.03|
|Total|184,813,373.69|203,784,886.40|

 (2) Adjustment Process of Accounting Profit and Income Tax Expense
Unit: RMB
|||
|-|-|
|Item|Reporting Period|
|Profit before taxation|777,475,125.71|
|Current income tax expense accounted at statutory/applicable tax||
||194,368,781.43|
|rate||
|Influence of applying different tax rates by subsidiaries|-35,695.97|
|Influence of income tax before adjustment|751,191.04|
|Influence of non-deductable costs, expenses and losses|3,216,782.60|
|Influence of deductable loss of unrecognized deferred income tax||
||-4,019,160.74|
|assets in prior period||
|Influence of deductable temporary difference or deductable||
|losses of unrecognized deferred income tax in the Reporting|-9,468,524.67|
|Period||
|Income tax expense|184,813,373.69|

 Other notes
66. Other Comprehensive Income
Refer to Note VII-48 for details.
67. Cash Flow Statement
(1) Cash Generated from Other Operating Activities
Unit: RMB
||||
|-|-|-|
|Item|Reporting Period|Same Period of last year|
|Large intercourse funds|0.00|3,000,000.00|
|Interest income|50,333,967.32|25,827,011.83|
|Net margins, security deposit and various|||
||3,846,601.06|2,838,483.50|
|special funds received|||
|Other small receivables|0.00|6,991,846.30|
|Total|54,180,568.38|38,657,341.63|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Notes:
None
(2) Cash Used in Other Operating Activities
Unit: RMB
||||
|-|-|-|
|Item|Reporting Period|Same Period of last year|
|Paying administrative expense in cash|29,464,167.94|38,821,683.72|
|Paying selling expense in cash|44,006,125.48|24,407,136.09|
|Net amount of utilities, miscellaneous|||
|fees and accident fee and other payments|19,149,484.39|20,314,557.26|
|on behalf|||
|Other small payments||6,611,337.86|
|Total|92,619,777.81|90,154,714.93|

 Notes:
None
(3) Cash Generated from Other Investing Activities
Unit: RMB
||||
|-|-|-|
|Item|Reporting Period|Same Period of last year|

Notes:
Not applicable
(4) Cash Used in Other Investing Activities
Unit: RMB
||||
|-|-|-|
|Item|Reporting Period|Same Period of last year|

Notes:
Not applicable
(5) Cash Generated from Other Financing Activities
Unit: RMB
||||
|-|-|-|
|Item|Reporting Period|Same Period of last year|

Notes:
Not applicable
(6) Cash Used in Other Financing Activities
Unit: RMB
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||
|-|-|-|
|Item|Reporting Period|Same Period of last year|

Notes:
Not applicable
68. Supplemental Information for Cash Flow Statement
(1) Supplemental Information for Cash Flow Statement
Unit: RMB
||||
|-|-|-|
|Supplemental information|Reporting Period|Same period of last year|
|1. Reconciliation of net profit to net cash|||
||--|--|
|flows generated from operating activities|||
|Net profit|592,661,752.02|622,962,734.37|
|Add: Provision for impairment of assets|-6,926,131.97|-56,696,940.86|
|Depreciation of fixed assets, oil-gas assets,|||
||27,721,578.69|38,598,604.19|
|and productive living assets|||
|Amortization of intangible assets||6,556,461.12|
|Amortization of long-term prepaid expenses|635,167.63|498,718.07|
|Losses from disposal of fixed assets,|||
|intangible assets and other long-lived assets|8,096.97|11,772.11|
|(gains: negative)|||
|Losses on scrap of fixed assets (gains:|||
||71,392.61||
|negative)|||
|Finance costs (gains: negative)|-5,212.00|36,939.72|
|Investment loss (gains: negative)|-1,889,021.11|-106,874,030.32|
|Decrease in deferred income tax assets|||
||-131,761,434.00|-10,038,547.95|
|(gains: negative)|||
|Increase in deferred income tax liabilities|||
||-3,392.55|-5,819.36|
|(―-‖ means decrease)|||
|Decrease in inventory (gains: negative)|677,488,978.60|770,702,729.75|
|Decrease in accounts receivable generated|||
||-43,238,766.69|68,508,132.92|
|from operating activities (gains: negative)|||
|Increase in accounts payable used in|||
||8,836,623.81|-1,680,530,514.70|
|operating activities (decrease: negative)|||
|Other|||
|Net cash generated from/used in operating|1,123,594,927.59|-346,269,760.94|
|activities|||
|2. Significant investing and financing|--|--|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||
|-|-|-|
|activities without involvement of cash|||
|receipts and payments|||
|3. Net increase/decrease of cash and cash|||
||--|--|
|equivalent:|||
|Ending balance of cash|3,375,714,690.09|2,464,626,655.21|
|Less: beginning balance of cash|2,464,626,655.21|2,857,353,056.85|
|Add: ending balance of cash equivalents|||
|Less: beginning balance of cash equivalents|||
|Net increase in cash and cash equivalents|911,088,034.88|-392,726,401.64|

 (2) Net Cash Paid For Acquisition of Subsidiaries
Unit: RMB
|||
|-|-|
||Amount|
|Of which:|--|
|Of which:|--|
|Of which:|--|

Othernotes：
None
(3) Net Cash Receive from Disposal of the Subsidiaries
Unit: RMB
|||
|-|-|
||Amount|
|Cash or cash equivalents received in the Reporting Period from||
||79,901,686.57|
|disposal of subsidiaries in the Current Period||
|Of which:|--|
|Of which: Shenzhen International Trade Center Car Industry Co.,||
||68,998,374.55|
|Ltd.||
|Shenzhen Shenxin Taxi Co., Ltd.|10,903,312.02|
|Of which:|--|
|Of which:|--|
|Net cash received from disposal of subsidiaries|79,901,686.57|

 Othernotes：
None
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 (4) Cash and Cash Equivalents
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|
|I. Cash|3,375,714,690.09|2,464,626,655.21|
|Including: Cash on hand|176,193.08|164,502.21|
|Bank deposit on demand|3,375,538,497.01|2,463,348,038.01|
|Other monetary fund on demand||1,114,114.99|
|III. Ending balance of cash and cash|3,375,714,690.09|2,464,626,655.21|
|equivalents|||

Othernotes：
None
69. Notes to Items of the Statements of Changes inOwners’ Equity
Notes to the name of―Other‖ of ending balance of the same period of last year adjusted and the amount adjusted:
Not applicable
70. Assets with Restricted Ownership or Right to Use
Unit: RMB
||||
|-|-|-|
|Item|Ending carrying value|Reason for restriction|
|Monetary capital|13,519,667.63|Refer to Note XIV.-2-(2)|
|Total|13,519,667.63|--|

Othernotes：
71. Foreign Currency Monetary Items
(1) Foreign Currency Monetary Items
Unit: RMB
|||||
|-|-|-|-|
||Ending foreign currency||Ending balance converted to|
|Item||Exchange rate||
||balance||RMB|
|Monetary capital|--|--||
|Of which: USD||||
|EUR||||
|HKD|61,076,208.86|0.8762|53,514,974.20|
|Accounts receivable|--|--||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||
|-|-|-|-|
|Of which: USD||||
|EUR||||
|HKD||||
|Long-term borrowings|--|--||
|Of which: USD||||
|EUR||||
|HKD||||
|Other receivables||||
|Of which: HKD|770.00|0.8762|674.67|
|Available-for-sale financial assets||||
|Of which: USD|91,707.93|6.8632|629,409.87|
|Accounts payable||||
|Of which: HKD|56,000.00|0.8762|49,067.20|
|Other payables||||
|Of which: HKD|578,289.25|0.8762|506,697.04|
|Long-term payables||||
|Of which: USD|8,768.06|6.8632|60,176.95|
|HKD|422,631.32|0.8762|312,455.77|

 Othernotes：
(2) Notes to Overseas Entities Including: for Significant Oversea Entities, Main Operating Place, Recording Currency and Selection Basis Shall Be Disclosed; if there Are Changes in Recording Currency, Relevant Reasons Shall Be Disclosed.
√ Applicable□ Not applicable
||||
|-|-|-|
|Item|Mainoperatingplace|Recordingcurrency|
|Shum Yip Properties Development Co.,Ltd. and its subsidiary|HongKong|HKD|

72. Arbitrage
Qualitative and quantitative information of relevant arbitrage instruments, hedged risk in line with the type of arbitrage to disclose:
Not applicable
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 73. Government Subsidy
(1) Basic Information on Government Subsidy
Unit: RMB
|||||
|-|-|-|-|
||||Amount recorded in the current|
|Category|Amount|Listed items||
||||profit or loss|
|Subsidy for stabilizing posts|165,676.08|Non-operating income|165,676.08|

 (2) Return of Government Subsidy
□ Applicable√ Not applicable
Other notes:
74. Other
Not applicable
VIII. Changes of Consolidation Scope
1. Business Combination Not under the Same Control
(1) Business Combination Not under the Same Control during the Reporting Period
Unit: RMB
||||||||||
|-|-|-|-|-|-|-|-|-|
||||||||Income of|Net profits of|
||Time and||||||||
|||Cost of||||Recognition|acquiree from|acquiree from|
|Name of|place of||Proportion of|Way to gain|||||
|||gaining the|||Purchase date|basis of|the purchase|the purchase|
|acquiree|gaining the||equity|the equity|||||
|||equity||||purchase date|date to|date to|
||equity||||||||
||||||||period-end|period-end|

 Othernotes：
Not applicable
(2) Combination Cost and Goodwill
Unit: RMB
||
|-|
|Combination cost|

Note to determination method of the fair value of the combination cost, consideration and changes:
Not applicable
The main formation reason for the large goodwill:
Not applicable
Othernotes：
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Not applicable
(3) The Identifiable Assets and Liabilities of Acquiree on Purchase Date
Unit: RMB
|||
|-|-|
|Fair value on purchase date|Carrying value on purchase date|

 The determination method of the fair value of identifiable assets and liabilities
Not applicable
Contingent liability of acquiree undertaken in the business combination
Not applicable
Othernotes：
Not applicable
(4) Gains or losses from Re-measurement of Equity Held before the Purchase Date at Fair Value
Whether there is a transaction that through multiple transaction step by step to realize business combination and gaining the control during the Reporting Period
□ Yes√ No
(5) Notes to Reasonable Consideration or Fair Value of Identifiable Assets and Liabilities of the Acquiree that Cannot Be Determined on the Acquisition Date or during the Period-end of the Merger
Not applicable
(6) Other Notes
Changes in consolidation scope for other reasons
On 1 November 2018, Shenzhen International Trade Center Property Management Co., Ltd., theCompany‘s subsidiary, and Slender West Lake Tourism Business Management Group jointly established Yangzhou Slender West Lake Jingyue Property Management Co., Ltd. with a registered capital of RMB10,000,000.00, among which, RMB5,100,000.00 was offered by Shenzhen International Trade Center Property Management Co., Ltd. for shareholding ratio of51.00%.
On 5 September 2018, Shandong International Trade Center Property Management Co., Ltd., the subsidiary of the Company, set up a wholly-owned subsidiary Shandong International Trade Center Hotel Management Co., Ltd. with a registered capital of RMB300,000.00.
2. Business Combination under the Same Control
(1) Business Combination under the Same Control during the Reporting Period
Unit: RMB
||||||||||
|-|-|-|-|-|-|-|-|-|
|Combined|Proportion of||Combination|Recognition|Income from|Net profits|Income of the|Net profits of|
|||Basis|||||||
|party|the equity||date|basis of|the|from the|acquiree|the acquiree|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||||
|-|-|-|-|-|
|combination|period-begin|period-begin|during the|during the|
|date|ning to the|ning to the|period of|period of|
||combination|combination|comparison|comparison|
||date of the|date of the|||
||acquiree|acquiree|||

Othernotes：
(2) Combination Cost
Unit: RMB
||
|-|
|Combination cost|

Note to contingent consideration and the changes:
Othernotes：
(3) The Carrying Value of Assets and Liabilities of the Combined Party on the Combination Date
Unit: RMB
|||
|-|-|
|Combination date|Period-end of the last period|

 Contingent liabilities of the combined party undertaken in the business combination
Othernotes：
3. Counter Purchase
Basic information of trading, the basis of transactions constitute counter purchase, the retain assets , liabilities of the listed companies whether constituted a business and its basis, the determination of the combination costs, the amount and calculation of adjusted rights and interests in accordance with the equity transaction process:
4. Disposal of Subsidiary
Whether there is a single disposal of the investment to the subsidiary and lost control?
□ Yes√ No
Whether there are several disposals of the investment to the subsidiary and lost controls?
□ Yes√ No
5. Changes in Combination Scope for Other Reasons
Note to changes in combination scope for other reasons (such as newly establishment or liquidation of subsidiaries, etc.) and relevant information:
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 6. Other
IX. Equity in Other Entities
1. Equity in Subsidiary
(1) Subsidiaries
||||||||
|-|-|-|-|-|-|-|
||Main operating||Nature of|Holding percentage (%)|||
|Name||Registration place||||Way of gaining|
||place||business|Directly|Indirectly||
|Shenzhen|||||||
||||Property||||
|Huangcheng Real|Shenzhen|Shenzhen||100.00%||Set-up|
||||development||||
|Estate Co., Ltd.|||||||
|Szprd Real Estate|||||||
||||Property||||
|Development Co.,|Shenzhen|Shenzhen||95.00%|5.00%|Set-up|
||||development||||
|Ltd.|||||||
|Prd Group|||||||
|Xuzhou Dapeng|||||||
||||Property||||
|Real Estate|Xuzhou|Xuzhou||100.00%||Set-up|
||||development||||
|Development Co.,|||||||
|Ltd.|||||||
|Dongguan|||||||
|International|||||||
|Trade Center|||||||
||||Property||||
|Changsheng Real|Dongguan|Dongguan||100.00%||Set-up|
||||development||||
|Estate|||||||
|Development Co.,|||||||
|Ltd.|||||||
|Prd Yangzhou|||||||
|Real Estate|||Property||||
||Yangzhou|Yangzhou||100.00%||Set-up|
|Development Co.,|||development||||
|Ltd.|||||||
|Shenzhen|||||||
|International|||||||
|Trade Center|||Property||||
||Shenzhen|Shenzhen||100.00%||Set-up|
|Property|||management||||
|Management Co.,|||||||
|Ltd.|||||||
|Shenzhen|||||||
|Huangcheng Real|||Property||||
||Shenzhen|Shenzhen|||100.00%|Set-up|
|Estate|||management||||
|Management Co.,|||||||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||||||
|-|-|-|-|-|-|-|
|Ltd.|||||||
|Shandong|||||||
|Shenzhen|||||||
|International|||||||
||||Property||||
|Trade Center|Jinan|Jinan|||100.00%|Set-up|
||||management||||
|Property|||||||
|Management Co.,|||||||
|Ltd.|||||||
|Chongqing|||||||
|Shenzhen|||||||
|International|||||||
||||Property||||
|Trade Center|Chongqing|Chongqing|||100.00%|Set-up|
||||management||||
|Property|||||||
|Management Co.,|||||||
|Ltd.|||||||
|Chongqing|||||||
|Ao‘Bo Elevator|Chongqing|Chongqing|Service||100.00%|Set-up|
|Co., Ltd.|||||||
|Shenzhen|||||||
|Tianque Elevator|||||||
||Shenzhen|Shenzhen|Service||100.00%|Set-up|
|Technology Co.,|||||||
|Ltd.|||||||
|Shenzhen|||||||
|International|||||||
|Trade Center|||||||
|Property|||||||
||Shenzhen|Shenzhen|Service||100.00%|Set-up|
|Management|||||||
|Engineering|||||||
|Equipment Co.,|||||||
|Ltd.|||||||
|Shenzhen|||||||
|International|||||||
||Shenzhen|Shenzhen|Catering service|100.00%||Set-up|
|Trade Center|||||||
|Food Co., Ltd.|||||||
|Shenzhen|||||||
|Property|||||||
||||Project||||
|Construction|Shenzhen|Shenzhen|||100.00%|Set-up|
||||supervision||||
|Supervision Co.,|||||||
|Ltd.|||||||
|Shenzhen|||||||
|International|Shenzhen|Shenzhen|Service industry|100.00%||Set-up|
|Trade Real Estate|||||||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||||||
|-|-|-|-|-|-|-|
|Exchange Center|||||||
|Zhanjiang|||||||
|Shenzhen Real|||||||
||||Property||||
|Estate|Zhanjiang|Zhanjiang||100.00%||Set-up|
||||development||||
|Development Co.,|||||||
|Ltd.|||||||
|Shum Yip|||||||
|Properties|||Property||||
||Hong Kong|Hong Kong||100.00%||Set-up|
|Development Co.,|||development||||
|Ltd.|||||||
|Wayhang|||||||
||||Property||||
|Development Co.,|Hong Kong|Hong Kong|||100.00%|Set-up|
||||development||||
|Ltd.|||||||
|Chief Link|||||||
||||Property||||
|Properties Co.,|Hong Kong|Hong Kong|||70.00%|Set-up|
||||development||||
|Ltd.|||||||
|||||||Business|
|Syndis|||||||
||||Property|||combination not|
|Investment Co.,|Hong Kong|Hong Kong|||70.00%||
||||development|||under the same|
|Ltd.|||||||
|||||||control|
|Yangzhou|||||||
|Slender West|||||||
|Lake Jingyue|||Property||||
||Yangzhou|Yangzhou|||51.00%|Set-up|
|Property|||development||||
|Development Co.,|||||||
|Ltd.|||||||
|Shangdong|||||||
|International|||||||
|Trade Center|||||||
||Jinan|Jinan|Service industry||100.00%|Set-up|
|Hotel|||||||
|Management Co.,|||||||
|Ltd.|||||||

Notes: holding proportion in subsidiary different from voting proportion:
Not applicable
Basis of holding half or less voting rights but still controlling the investee and holding more than half of the voting rights but not controlling the investee:
Not applicable
Significant structural entities and controlling basis in the scope of combination:
Not applicable
Basis of determining whether the Company is the agent or the principal:
Not applicable
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Othernotes：
None
(2) Significant Non-wholly-owned Subsidiary
Unit: RMB
||||||
|-|-|-|-|-|
||Shareholding proportion|The profit or loss|Declaring dividends|Balance of|
|Name|of non-controlling|attributable to the|distributed to|non-controlling interests|
||interests|non-controlling interests|non-controlling interests|at the period-end|
|Yangzhou Slender West|||||
|Lake Jingyue Property|49.00%|-62,100.69||2,387,899.31|
|Development Co., Ltd.|||||

Holding proportion of non-controlling interests in subsidiary different from voting proportion:
Othernotes：
(3) The Main Financial Information of Significant Not Wholly-owned Subsidiary
Unit: RMB
||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|
||Ending balance||||||Beginning balance||||||
|||Non-curr|||Non-curr|||Non-curr|||Non-curr||
|Name|Current||Totalassets|Current||Total|Current||Total|Current||Total|
|||ent|||ent|||ent|||ent||
||assets|||liabilities||liabilities|assets||assets|liabilities||liabilities|
|||assets|||liability|||assets|||liability||
|Yangzho|||||||||||||
|u|||||||||||||
|Slender|||||||||||||
|West|||||||||||||
|Lake|4,873,26||4,873,263.90||||||||||
|||0.00||0.00|0.00|0.00|0.00|0.00|0.00|0.00||0.00|
|Jingyue|3.90||||||||||||
|Property|||||||||||||
|Develop|||||||||||||
|ment|||||||||||||
|Co., Ltd.|||||||||||||

Unit: RMB
||||||||||
|-|-|-|-|-|-|-|-|-|
||Reporting Period||||Same period of last year||||
|||||Cash flows||||Cash flows|
||||Total||||Total||
|Name|Operatingrevenue|||from|Operating|||from|
|||Net profit|comprehensi|||Net profit|comprehensi||
|||||operating|revenue|||operating|
||||ve income||||ve income||
|||||activities||||activities|
|Yangzhou|||||||||
|Slender West|0.00|-126,736.10|-126,736.10|-126,736.10|0.00|0.00|0.00|0.00|
|Lake Jingyue|||||||||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||
|-|
|Property|
|Development|
|Co., Ltd.|

Othernotes：
(4) Significant Restrictions on Using the Assets and Liquidating the Liabilities of the Company
None
(5) Financial Support or Other Supports Provided to Structural Entities Incorporated into the Scope of Consolidated Financial Statements
None
Othernotes：
2. The Transaction of the Company with ItsOwner’s Equity Share Changed but Still Controlling the Subsidiary
(1) Note to theOwner’s Equity Share Changed in Subsidiary
None
(2) TheTransaction’s Influence on the Equity of Non-controlling Interests and the Owner's Equity Attributable to the Company as the Parent
Unit: RMB
 Other notes
Not applicable
3. Equity in Joint Ventures or Associated Enterprises
(1) Significant Joint Ventures or Associated Enterprises
||||||||
|-|-|-|-|-|-|-|
|||||Holding percentage (%)||Accounting|
|||||||treatment of the|
||Main operating||Nature of|||investment to|
|Name||Registration place|||||
||place||business|Directly|Indirectly|joint venture or|
|||||||associated|
|||||||enterprise|
|Shenzhen Jifa|||||||
|Warehouse Co.,|Shenzhen|Shenzhen|Warehouse serve|50.00%||Equity method|
|Ltd.|||||||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||||
|-|-|-|-|-|-|
|Tianan||||||
|International||||||
|Building Property|||Property|||
||Shenzhen|Shenzhen||50.00%|Equity method|
|Management|||management|||
|Company of||||||
|Shenzhen||||||

Notes to holding proportion of joint venture or associated enterprise different from voting proportion:
Not applicable
Basis of holding less than20% of the voting rights but has a significant impact or holding20% or more voting rights but does not have a significant impact:
Not applicable
(2) Main Financial Information of Significant Joint Ventures
Unit: RMB
||||||
|-|-|-|-|-|
||Ending balance/Reporting Period||Beginning balance/The same period of last year||
|||Tianan International||Tianan International|
||Shenzhen Jifa Warehouse|Building Property|Shenzhen Jifa Warehouse|Building Property|
||Co., Ltd.|Management Company|Co., Ltd.|Management Company|
|||of Shenzhen||of Shenzhen|
|Current assets|9,555,202.09|50,941,418.43|6,879,862.65|47,958,558.83|
|Of Which: Cash and cash|||||
||8,614,698.79|34,496,954.60|5,890,362.65|34,268,115.61|
|equivalents|||||
|Non-current assets|62,828,540.59|38,523.34|63,528,043.92|29,349.24|
|Total assets|72,383,742.68|50,979,941.77|70,407,906.57|47,987,908.07|
|Current liabilities|4,176,061.89|22,970,163.57|3,410,681.06|21,253,083.10|
|Non-current liability||16,218,892.53||16,271,264.57|
|Total liabilities|4,176,061.89|39,189,056.10|3,410,681.06|37,524,347.67|
|Equity attributable To|||||
|owners of the Company|68,207,680.79|11,790,885.67|66,997,225.51|10,463,560.40|
|as the parent|||||
|Portion of net Assets|||||
|calculated according to|||||
||34,103,840.40|5,895,442.84|33,498,612.76|5,231,780.20|
|proportion of|||||
|shareholdings|||||
|Carrying value of equity|||||
|investment to joint|34,103,840.40|5,895,442.84|33,498,612.76|5,231,780.20|
|ventures|||||
|Operating revenue|5,269,653.82|20,490,161.85|7,504,631.18|17,581,422.94|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||||
|-|-|-|-|-|
|Finance expense|-19,322.34|-221,967.51|-12,400.09|-724,727.16|
|Income tax expense|403,485.10|444,662.96|836,613.87|495,714.73|
|Net profit|1,210,455.28|1,327,325.27|2,470,744.33|1,486,259.40|
|Other comprehensive|||||
||1,210,455.28|1,327,325.27|2,470,744.33|1,486,259.40|
|income|||||
|Total comprehensive|||||
||1,210,455.28|1,327,325.27|2,470,744.33|1,486,259.40|
|income|||||

Other notes
None
(3) Main Financial Information of Significant Associated Enterprise
Unit: RMB
|||
|-|-|
||Beginning balance/The same period of last|
|Ending balance/Reporting Period||
||year|

Other notes
Not applicable
(4) Summary Financial Information of Insignificant Joint Ventures or Associated Enterprises
Unit: RMB
||||
|-|-|-|
|||Beginning balance/The same period of last|
||Ending balance/Reporting Period||
|||year|
|Joint venture:|--|--|
|The total of following items according to the|||
||--|--|
|shareholding proportions|||
|Associated enterprise:|--|--|
|The total of following items according to the|||
||--|--|
|shareholding proportions|||

Other notes
Note: The Company has withdrawn depreciation reserves in full for its associated enterprise Shenzhen Wufang Pottery& Porcelain Industrial Co., Ltd. and now has no ability to obtain its financial statements. Therefore, the Company regarded it as insignificant associated enterprise.
(5) Note to the Significant Restrictions on the Ability of Joint Ventures or Associated Enterprises to Transfer Funds to the Company
None
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 (6) The Excess Loss of Joint Ventures or Associated Enterprises
Unit: RMB
|||||
|-|-|-|-|
||The cumulative recognized|The derecognized losses (or the||
||||The accumulative unrecognized|
|Name|losses in previous|share of net profit) in Reporting||
||||losses in Reporting Period|
||accumulatively derecognized|Period||

Other notes
Not applicable
(7) The Unrecognized Commitment Related to Investment to Joint Ventures
None
(8) Contingent Liabilities Related to Investment to Joint Ventures or Associated Enterprises
None
4. Significant Common Operation
|||||||
|-|-|-|-|-|-|
|||||Proportion /share portion||
|Name|Main operating place|Registration place|Nature of business|||
|||||Directly|Indirectly|

 Notes to holding proportion or share portion in common operation different from voting proportion:
None
For common operation as a single entity, basis of classifying as common operation
None
Other notes
None
5. Equity in the Structured Entity Excluded in the Scope of Consolidated Financial Statements
Notes to the structured entity excluded in the scope of consolidated financial statements:
None
6. Other
None
X. The Risk Related to Financial Instruments
The financial instruments of the Group include: monetary fund, the available for sale financial assets, borrowings, accounts
receivable and accounts payable, etc, for details, see disclosure in each note.
1. Market Risk
(1) Exchange rate risk
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Exchange rate risk refers to risk of losses due to fluctuation in exchange rate. Sensitive analysis of foreign exchange risk was as follows, which reflected the influence of changes in monetary assets and monetary liabilities on net profits andshareholders‘ equity when the following listed foreign exchanges showed reasonable and possible changes under the hypothesis of other variables constant.
|||||
|-|-|-|-|
|Item|Period-end|||
||Change in net profit|Change in equity ofshareholders|Change in net profit|
|RMB down 2% against HKD|789,711.43|1,864,214.88|-28.41|
|RMB up 2% against HKD|-789,711.43|-1,864,214.88|28.41|
|RMB down 2% against USD|8,538.49|8,538.49|-8,988.57|
|RMB up 2% against USD|-8,538.49|-8,538.49|8,988.57|

 2. Credit Risk
The credit risk mainly occurred in bank deposit, accounts receivable and other receivables. The source of credit risk of financial assets was the default of the other party. The biggest risk exposure was equivalent to book value of the instruments.
TheGroup‘s working capital was in bank with higher credit rating, so there was no significant credit risk, nor significant losses due to the default of other entity. Thus, the credit risk of working capital is relatively low.
There were accounts receivable withdrawn individually in the Group and had withdrawn bad debt provision, which fully reveal the existence of credit risk. Amount of balance of account receivables was RMB67,992,690.84 except the aforesaid had withdrawn bad debt provision, mainly was the account receivable of property management, of which was account receivable RMB21,389,086.53 of Taobao (China) Software Co., Ltd. was the total property management costs of several serve district of Taobao (China) Software Co., Ltd. Other client receivables were widely dispersed owners and tenants. The Group conducted continuous supervisor to the account receivables to ensure the Group not facing significant bad debt risk.
3. Liquidity Risk
The subsidiary of the Group monitor the cash flow and the need of itself, the headquarters of the finance department combine the cash flow of each subsidiary, continue to monitor the short term or long term capital needs to ensure maintain plenty of cash flow. Besides, according to the actual capital need of the Group, provided commitment of adequate emergency capital to meet the short term and long term capital need.
XI. The Disclosure of Fair Value
1. Ending Fair Value of Assets and Liabilities at Fair Value
Unit: RMB
||||||
|-|-|-|-|-|
||Ending fair value||||
|Item|Fair value measurement|Fair value measurement|Fair value measurement||
|||||Total|
||items at level 1|items at level 2|items at level 3||
|I. Consistent fair value|||||
||--|--|--|--|
|measurement|||||
|(II)Available-for-sale|||||
||3,621,381.11|||3,621,381.11|
|financial assets|||||
|(2) equity instrument|3,621,381.11|||3,621,381.11|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||||
|-|-|-|-|-|
|investment|||||
|The total amount of assets|||||
||3,621,381.11|||3,621,381.11|
|measured at fair value|||||
|II. Inconsistent fair value|||||
||--|--|--|--|
|measurement|||||

2. Market Price Recognition Basis for Consistent and Inconsistent Fair Value Measurement Items at Level 1
The closing price in the national stock transfer system for small and medium sized enterprises on 30 December 2018
3. Valuation Technique Adopted and Nature and Amount Determination of Important Parameters for Consistent and Inconsistent Fair Value Measurement Items at Level 2
Not applicable
4. Valuation Technique Adopted and Nature and Amount Determination of Important Parameters for Consistent and Inconsistent Fair Value Measurement Items at Level 3
Not applicable
5. Sensitiveness Analysis on Unobservable Parameters and Adjustment Information between Beginning and Ending Carrying Value of Consistent Fair Value Measurement Items at Level 3
Not applicable
6. Explain the Reason for Conversion and the Governing Policy when the Conversion Happens if Conversion Happens among Consistent Fair Value Measurement Items at Different Levels
Not applicable
7. Changes in the Valuation Technique in the Current Period and the Reason for Such Changes
Not applicable
8. Fair Value of Financial Assets and Liabilities Not Measured at Fair Value
Not applicable
9. Other
Not applicable
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 XII. Related Party and Related-party Transactions
1. Information Related to the Company as the Parent of the Company
|||||||
|-|-|-|-|-|-|
|||||Proportion of share|Proportion of voting|
|||||held by the|rights owned by the|
|Name|Registration place|Nature of business|Registered capital|Company as the|Company as the|
|||||parent against the|parent against the|
|||||Company (%)|Company (%)|
|Shenzhen||||||
|||Managing||||
|Investment Holdings|Shenzhen||RMB25,349,000,000|63.82%|63.82%|
|||state-owned assets||||
|Co., Ltd||||||

Notes: information on the Company as the parent
Note: Shenzhen Investment Holdings Co., Ltd. is the final controller of the Company and also is a sole state-funded limited company. As a government department, Shenzhen State-owned Assets Supervision and Administration Bureau manage Shenzhen Investment Holdings Co., Ltd. on behalf ofPeople‘s Government of Shenzhen Municipality. Thus, the final controller of the Company is Shenzhen State-owned Assets Supervision and Administration Committee of Shenzhen Government.
The registered capital of Shenzhen Investment Holdings Co., Ltd. was changed into RMB25,349,000,000 on 4 December 2018. The original registered capital was RMB RMB23,149 million.
The final controller of the Company is Shenzhen State-owned Assets Supervision and Administration Committee of Shenzhen Government.
Othernotes：
None
2. Subsidiaries of the Company
Refer to Note IX-1. Equity in Subsidiary for details.
3. Information on the Joint Ventures and Associated Enterprises of the Company
Refer to Note IX-3. Equity in Joint Ventures or Associated Enterprises for details about significant joint ventures or associated enterprises.
Information on other joint venture or associated enterprise of occurring related-party transactions with the Company in Reporting Period, or forming balance due to related-party transactions made in previous period:
|||
|-|-|
|Name|Relationship with the Company|

Other notes
Not applicable
4. Information on Other Related Parties
|||
|-|-|
|Name|Relationship with the Company|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||
|-|-|
||Under the same control of the Company as the parent of the|
|Shenzhen Investment Holdings Co., Ltd.||
||Company|

Other notes
None
5. List of Connected Transactions
(1) Information on Acquisition of Goods and Reception of Labor Service
Information on acquisition of goods and reception of labor service
Unit: RMB
|||||||
|-|-|-|-|-|-|
||||The approval trade|Whether exceed trade|Same period of last|
|Related party|Content|Reporting Period||||
||||credit|credit or not|year|
||||||0.00|

 Information of sales of goods and provision of labor service
Unit: RMB
|||||
|-|-|-|-|
|Related party|Content|Reporting Period|Same period of last year|
|Shenzhen Investment Holdings||||
||Property management|943,396.23|0.00|
|Co., Ltd.||||

Notes:
(2) Information on Related-party Trusteeship/Contract
Lists of trusteeship/contract:
Unit: RMB
||||||||
|-|-|-|-|-|-|-|
|Name of the|Name of the|||||Income|
|entruster/contract|entrustee/|Type|Start date|Due date|Pricing basis|recognized in this|
|ee|contractor|||||Reporting Period|

 Notes:
Not applicable
Lists of entrust/contractee
Unit: RMB
||||||||
|-|-|-|-|-|-|-|
|Name of the|Name of the|||||Charge|
|entruster/contract|entrustee/|Type|Start date|Due date|Pricing basis|recognized in this|
|ee|contractor|||||Reporting Period|

 Notes:
Not applicable
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 (3) Information on Related-party Lease
The Company was lessor:
Unit: RMB
|||||
|-|-|-|-|
|||The lease income confirmed in|The lease income confirmed in|
|Name of lessee|Category of leased assets|||
|||the Reporting Period|the same period of last year|

 The Company was lessee:
Unit: RMB
|||||
|-|-|-|-|
|||The lease fee confirmed in the|The lease fee confirmed in the|
|Name of lessor|Category of leased assets|||
|||Reporting Period|same period of last year|
|Shenzhen Investment Holdings||||
||Office|365,868.00|358,700.40|
|Co., Ltd.||||

Notes:
(4) Information on Related-party Guarantee
The Company was guarantor:
Unit: RMB
||||||
|-|-|-|-|-|
|||||Execution accomplished|
|Secured party|Guarantee amount|Start date|End date||
|||||or not|

The Company was secured party
Unit: RMB
||||||
|-|-|-|-|-|
|||||Execution accomplished|
|Guarantor:|Guarantee amount|Start date|End date||
|||||or not|

Notes:
Not applicable
(5) Information on Inter-bank Lending of Capital of Related Parties
Unit: RMB
||||||
|-|-|-|-|-|
|Related party|Amount|Start date|End date|Note|
|Borrowing|||||
|Lending|||||

(6) Information on Assets Transfer and Debt Restructuring by Related Party
Unit: RMB
|||||
|-|-|-|-|
|Related party|Content|Reporting period|Same period of last year|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 (7) Information on Remuneration for Key Management Personnel
Unit: RMB
||||
|-|-|-|
|Item|Reporting period|Same period of last year|
|Remuneration for key management|||
||9,764,725.59|6,426,500.00|
|personnel|||

(8) Other Related-party Transactions
Not applicable
6. Accounts Receivable and Payable of Related Party
(1) Accounts Receivable
Unit: RMB
|||||||
|-|-|-|-|-|-|
|||Ending balance||Beginning balance||
|Item|Related party|||||
|||Carrying amount|Bad debt provision|Carrying amount|Bad debt provision|
||Shenzhen Wufang|||||
|Other receivables|Pottery & Porcelain|1,747,264.25|1,747,264.25|1,747,264.25|1,747,264.25|
||Industrial Co., Ltd.|||||

(2) Accounts Payable
Unit: RMB
|||||
|-|-|-|-|
|Item|Related party|Ending carrying amount|Beginning carrying amount|
||Shenzhen Jifa Warehouse Co.,|||
|Other payables||29,296,665.14|29,296,665.14|
||Ltd.|||
||Tianan International Building|||
|Other payables|Property Management|5,214,345.90|5,214,345.90|
||Company of Shenzhen|||

7. Commitments of Related Party
None
8. Other
Not applicable
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 XIII. Stock Payment
1. The Overall Situation of Stock Payment
□ Applicable□ Not applicable
2. The Stock Payment Settled in Equity
□ Applicable□ Not applicable
3. The Stock Payment Settled in Cash
□ Applicable□ Not applicable
4. Modification and Termination of the Stock Payment
None
5. Other
None
XIV. Commitments and Contingency
1. Significant Commitments
Significant Contingency on Balance Sheet Date
2. Contingency
(1) Significant Contingency on Balance Sheet Date
(1)Pending Action
The action about transferring Jiabin Building contentious matter ( Now rename as: Longyuan Development Building; former name Jinlihua CommercialPlaza）
In 1993, the Company signed Right of Development Transfer Contract of Jiabin Building with Shenzhen Jiyong Property Development Co., Ltd. (hereinafter referred to as―JiyongCompany‖). Since the contract was not effectively executed, the Company subsequently filed a series of lawsuits against the parties involved in the project, but the outcome was not favorable to the Company. Therefore, the Company calculated and withdrew bad-debt provisions for accounts receivable from Jiyong Company in full in past years for the transfer of Jiabin Building (see 2. (4) of Note VII for details). On October 31, 2018, Shenzhen IntermediatePeople‘s Court made a civil award and ruled that theCompany‘s application for the bankruptcy of Jiyong Company would not be accepted. The Company refused to accept such ruling and has appealed to Shenzhen IntermediatePeople‘s Court.
(2) Guarantee
①:TheCompany’s subsidiary Dongguan International Trade Center Changsheng Real Estate Development Co., Ltd. belongs to provisional qualification real estate development enterprise, when dealing with the application of approval of the presale of houses,
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 the commercial housing quality guarantee after the liquidations of enterprise bankruptcy, dissolution, Dongguan International Trade Center Changsheng Real Estate Development Co., Ltd. submitted guarantee RMB12,402,160.00 to Bank of Communications, Duangguang, Dalang Branch, the bank issue 9 Guarantee Letter for irrevocable goods, of which one guarantee of RMB1,468,870.00, from 30 June 2015 to 31 December 2020, and the remained were RMB10,933,290.00 from 1 July 2015 to 31 December 2020. As of 31 December 2018, the Company has get the original L/G back from Land and Resources Bureau.
②: As a real estate developer, the Company has provided mortgage guarantees for commercial housing purchasers and paid loan guarantees according to real estate business practices. As of 31 December 2018, the balance of the cash deposit that have not been released is RMB1,117,507.63. That guarantee will be released on the date when the mortgage money is paid off.
③: The Company and its subsidiaries provide mortgage guarantees for commercial housing purchasers according to the real estate business practice. The purchaser uses the purchased commercial housing as collateral. The guarantee amount that has not been settled as of 31 December 2018 totals RMB735,697,969.36. and since so far, purchasers have not defaulted, and the current market price of these properties is higher than the selling price, the Company believes that the risks associated with providing such guarantees are relatively low.
④: On 20 April 2018, Shenzhen Huangcheng Real Estate Co., Ltd. (hereinafter referred to as―Huangcheng RealEstate‖), a subsidiary of the Company, signed a fixed asset borrowing contract with the Shenzhen Branch of Bank of Shanghai Co., Ltd., in which, the land use right of GoldenCollar‘s Resort was mortgaged and the Company agreed to provide guarantee for Huangcheng Real Estate. In November 2018, due to the pre-sale of GoldenCollar’s Resort Project, mortgage of the land use right was released according to the requirements of the Housing Authority. Only the credit guarantee provided by the Company for Huangcheng Real Estate was still effective. As of the end of the period, the details about the remaining outstanding guarantee are as follows:
||||
|-|-|-|
|Secured party|Content|Guarantee period|
|Shenzhen Huangcheng Real Estate Co.,Ltd.|Shenzhen Branch of Bankof Shanghai|20 June 2018 to 20 June 2021|
|Total|||

(2) In Despite of no Significant Contingency to Disclose, the Company Shall Also Make Relevant Statements
There was no significant contingency in the Company to disclose.
3. Other
Acquisition event after the Reporting Period
On 26 February 2019, the Company signed the share transfer agreement with Shenzhen Xinhai Rongyao Real Estate Development Co., Ltd. (hereinafter referred to as―XinhaiRongyao‖) to acquire69% of shares in its subsidiary Shenzhen Rongyao Real Estate Development Co., Ltd. (hereinafter referred to as the―targetcompany‖). The price for transfer of shares in the target company agreed bilaterally is RMB508 million which will be paid in four installments based on the progress of the project stipulated in the agreement. After the completion of share transfer, the Company will develop the project of urban renewal unit in Bangling region owned by the target company together with Xinhai Rongyao. As of the period-end, the Company has paid a subscription of RMB0.1 billion which will be offset the share transfer money payable when meeting the clauses of the first payment as stipulated in the share transfer agreement. The plan for payment of share transfer was as follows:
||
|-|
|Payment clause|
|Completing the setting up of fund supervision account and all application documentsrequired in the registration changing procedures have been prepared completely|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||
|-|
|Completion of demolition of Bangling Phase I|
|Completion of demolition of Bangling Phase II|
|Recognization of implementation subject of Bangling Phase I and Bangling Phase II|
|Total|

 XV. Events after Balance Sheet Date
1. Significant Non-adjusted Events
Unit: RMB
|||||
|-|-|-|-|
|||Influence number to the||
||||Reason of inability to estimate|
|Item|Content|financial position and operating||
||||influence number|
|||results||

2. Profit Distribution
Unit: RMB
|||
|-|-|
|Profits or dividends to be distributed|178,793,727.60|
|Profits or dividends announced to be distributed after the approval|178,793,727.60|

 3. Sales Return
None
4. Notes to Other Events after Balance Sheet Date
Influence of the Implementation of New ASBE from January 1, 2019
On 31 March 2017, the Ministry of Finance respectively issued ASBE No. 22-Recognition and Measurement of Financial Instruments (Revised in 2017) (CK[2017] No. 7), ASBE No. 23-Transfer of Financial Assets (Revised in 2017) (CK[2017] No. 8), and ASBE No. 24-Hedge Accounting (Revised in 2017) (CK[2017] No. 9). On 2 May 2017, ASBE No. 37-Presentation of financial instruments (Revised in 2017) (CK[2017] No. 14) was issued (all the above-mentioned standards are collectively referred to as―New Financial InstrumentsStandards‖), and domestic listed companies were required to implement these new standards from 1 January 2019 on. The Company will implement the above new financial instrument standards from 1 January 2019 on, and change relevant accounting policies in accordance with the above new financial instrument standards.
Main changes in the accounting policy involved are described as follows:
According to new financial instrument standards, all recognized financial assets shall be subsequently measured based on the amortized costs or the fair value.
On the implementation date of new financial instrument standards, the business model applied to manage the financial assets shall be evaluated based on the facts and circumstances of the Company on the day, and the contractual cash flow characteristics on the financial assets shall be evaluated based on the facts and circumstances resulting from the initial confirmation of the financial assets.
Financial assets are classified into three categories: Measured by the amortized cost, Measured by the fair value with changes
included in other comprehensive incomes and Measured by the fair value with changes included in profits or losses. For the equity
instrument investment measured by the fair value with changes included in other comprehensive incomes, when the financial asset is
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 derecognized, the accumulated gain or loss previously included in other comprehensive incomes shall be transferred from other comprehensive incomes to the retained earnings without being included in the current gain or loss.
Pursuant to new financial instrument standards, the Company shall calculate and withdraw corresponding provisions for impairment and recognize the credit impairment losses for financial assets measured by the amortized cost, debt instrument investments measured by the fair value with changes included in other comprehensive incomes, lease receivables, contract assets and the financial guarantee contract based on the expected credit loss.
XVI. Other Significant Events
1. The Accounting Errors Correction in Previous Period
(1) Retrospective Restatement
Unit: RMB
|||||
|-|-|-|-|
|||Name of the influenced report||
|Content|Processing program||accumulative impact|
|||items during comparison period||

(2) Prospective Application
||||
|-|-|-|
|||Reason for adopting prospective|
|Content|Processing program||
|||application|

2. Debt Restructuring
Not applicable
3. Assets Replacement
(1) Non-monetary Assets Exchange
Not applicable
(2) Other Assets Replacement
4. Pension Plan
Not applicable
5. Discontinued Operations
Unit: RMB
||||||||
|-|-|-|-|-|-|-|
|||||||Profit from|
|||||Income tax|||
|Item|Income|Expense|Total profit||Net profit|discontinued|
|||||expense|||
|||||||operations|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||
|-|
|attributable to|
|owners of the|
|Company as the|
|parent|

 Other notes
Not applicable
6. Segment Information
(1) Determination Basis and Accounting Policies of Reportable Segment
The Group's business includes real estate business, property management, catering services, and other business (including: mechanical and electrical professional maintenance business, automobile service, engineering supervision, parking lot, because of the above businesses income are small, approve them being merged), etc. The Group separately organized and managed according to the business and the properties of products and services provided. Each business division of the Group was a business group, provided the facing risk and obtained rewards and products different from other division.
A. Real estate business divisions: real estate development, sales and rental
B. The property management business divisions: building management
C. Diet services: catering service
D. Other business: operating mechanical and electrical professional maintenance business, automobile service, engineering supervision business, and parking lot
The management for the purpose of considering the decision of resources and evaluation of performance separately managed the operating results of each unit of business.
(2) The Financial Information of Reportable Segment
Unit: RMB
||||||||
|-|-|-|-|-|-|-|
|||Property|||Offset among||
|Item|Real estate||Catering service|Others||Total|
|||management|||segment||
|Operation|||||||
||2,285,948,875.48|468,624,110.77|32,010,217.83|16,497,980.20|-15,840,551.75|2,787,240,632.53|
|revenue|||||||
|Cost of sales|886,871,173.23|414,923,126.76|28,529,242.78|12,286,802.65|-27,420,353.58|1,315,189,991.84|
|Total profit|694,502,815.24|33,922,662.27|566,164.16|73,333.90|48,410,150.14|777,475,125.71|
||||||-2,143,268,150.6||
|Total assets|7,389,794,956.74|457,108,967.67|7,399,483.47|109,166,880.33||5,820,202,137.54|
||||||7||
||||||-1,904,318,518.3||
|Total liabilities|3,881,617,071.17|380,249,838.06|4,666,715.02|116,787,720.65||2,479,002,826.53|
||||||7||

(3) If there Was no Reportable Segment, or the Total Amount of Assets and Liabilities of Each Reportable
Segment Could not Be Reported, Relevant Reasons Shall Be Clearly Stated
Not applicable
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 (4) Other notes
①Foreign Trade Income regarding businesses
|||
|-|-|
|Item|Reporting Period|
|Real estate|2,282,760,505.89|
|Property management|462,035,401.49|
|Transportation|--|
|Catering service|29,404,981.03|
|Other|13,039,744.12|
|Total|2,787,240,632.53|

②Foreign trade income regarding geography and total non-current assets
|||||
|-|-|-|-|
|Countries or regions|Total foreign trrade income|||
||Reporting Period|Same period of lastyear|Reporting Period|
|Mainland of China|2,787,240,632.53|2,904,690,690.53|434,417,428.34|
|Hong Kong|--|--|1,144,430.25|
|Other regions|--|--|--|

 7. Other Significant Transactions and Events with Influence onInvestors’ Decision-making
Not applicable
8. Other
None
XVII. Notes of Main Items in the Financial Statements of the Company as the Parent
1. Notes Receivable and Accounts Receivable
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|
|Accounts receivable|1,853,494.72|479,462.50|
|Total|1,853,494.72|479,462.50|

 (1) Notes Receivable
1) Notes Receivable Listed by Category
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 2) Notes Receivable Pledged by the Company at the Period-end
Unit: RMB
|||
|-|-|
|Item|Amount|

3) Notes Receivable Endorsed by the Company or Discounted and not due on the Balance Sheet Date at the Period-end
Unit: RMB
||||
|-|-|-|
|||Non-derecognized amount at the|
|Item|Derecognized Amount at the period-end||
|||period-end|

4) Notes Transferred to Accounts Receivable because Drawer of the Notes Failed to Execute the Contract or Agreement
Unit: RMB
|||
|-|-|
||Amount of the notes transferred to accounts receivable at theperiod-end|
|Item||

Other notes
Not applicable
(2) Accounts Receivable
1) Accounts Receivable Classified by Category
Unit: RMB
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
||Ending balance|||||Beginning balance|||||
||Carrying amount||Bad debt provision|||Carrying amount||Bad debt provision|||
|||||Withdra|||||||
|Category|||||Carrying|||||Carrying|
|||Proportio||wal|||Proportio||Withdrawal||
||Amount||Amount||value|Amount||Amount||value|
|||n||proportio|||n||proportion||
|||||n|||||||
|Accounts receivable|||||||||||
|with significant|||||||||||
|single amount for|96,647,8||96,647,8|||96,647,||96,647,88|||
|||97.98%||100.00%|||99.03%||100.00%||
|which bad debt|89.05||89.05|||889.05||9.05|||
|provision separately|||||||||||
|accrued|||||||||||
|Accounts receivable|||||||||||
|withdrawal of bad|||||||||||
||1,940,44||86,951.6||1,853,494|893,820||414,357.6|||
|debt provision of by||1.97%||4.48%|||0.92%||46.36%|479,462.50|
||6.37||5||.72|.19||9|||
|credit risks|||||||||||
|characteristics:|||||||||||
|Accounts receivable|||||||||||
|with insignificant|54,380.3||54,380.3|||54,380.|||||
|||0.05%||100.00%|||0.05%|54,380.35|100.00%||
|single amount for|5||5|||35|||||
|which bad debt|||||||||||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
|provision separately|||||||||||
|accrued|||||||||||
||98,642,715.77||96,789,2|98.12%|1,853,494.72|97,596,||97,116,62||479,462.50|
|Total||100.00%|||||100.00%||99.51%||
||||21.05|||089.59||7.09|||

Accounts receivable with significant single amount for which bad debt provision separately accrued at the period-end:
√ Applicable□ Not applicable
Unit: RMB
||||||
|-|-|-|-|-|
|Accounts receivable（by|Ending balance||||
|unit）|Accounts receivable|Bad debt provision|Withdrawal proportion|Withdrawal reason|
|||||Involved in lawsuit and|
|Shenzhen Jiyong|||||
|||||with no executable|
|Properties & Resources|93,811,328.05|93,811,328.05|100.00%||
|||||property, please refer to|
|Development Company|||||
|||||Note XIV-2-(1)|
|Shenzhen Tewei Industry||||Not recovered for a long|
||2,836,561.00|2,836,561.00|100.00%||
|Co., Ltd.||||time|
|Total|96,647,889.05|96,647,889.05|--|--|

In the groups, accounts receivable adopted aging analysis method to withdraw bad debt provision:
√ Applicable□ Not applicable
Unit: RMB
|||||
|-|-|-|-|
||Ending balance|||
|Aging||||
||Accounts receivable|Bad debt provision|Withdrawal proportion|
|Subitem within 1 year||||
|Within 1 year|1,910,819.30|57,324.58|3.00%|
|Over 5 years|29,627.07|29,627.07|100.00%|

 Notes to the determination basis for the group:
For details, please refer to Part XI Financial Statement-V-11.
Among these groups, accounts receivable adopting balance percentage method to withdraw bad debt provision:
□ Applicable√ Not applicable
Among these groups, accounts receivable adopting other methods to withdraw bad debt provision:
Not applicable
2) Bad Debt Provision Withdrawal, Reversed or Recovered in the Reporting Period
The withdrawal amount of the bad debt provision during the Reporting Period was of RMB0.00; the amount of the reversed or collected part during the Reporting Period was of RMB327,406.04.
Significant amount of reversed or recovered bad debt provision:
Unit: RMB
||||
|-|-|-|
|Name of the entity|Amount|Method|

Not applicable
3) Particulars of the Actual Verification of Accounts Receivable during the Reporting Period
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Unit: RMB
|||
|-|-|
|Item|Amount|

Of which: significant actual verification of accounts receivable
Unit: RMB
|||||||
|-|-|-|-|-|-|
||||||Whether occurred|
||||||because of|
|Name of the entity|Nature|Amount|Reason|Procedure||
||||||related-party|
||||||transactions|

 Notes to verification of accounts receivable:
Not applicable
4) Top5 of the Ending Balance of the Accounts Receivable Collected according to Arrears Party
|||||
|-|-|-|-|
|Entity|Relationship withthe Company|Amount|Period|
|Shenzhen Jiyong Properties &Resources DevelopmentCompany|Non-related party|93,811,328.05|Over 5 years|
|Shenzhen Tewei Industry Co.,Ltd.|Non-related party|2,836,561.00|Over 5 years|
|Shenzhen Rainbow DepartmentStore Co., Ltd|Non-related party|1,046,117.49|1 to 5 years|
|PingAn Bank Co., Ltd.|Non-related party|459,252.00|Within 1 year|
|Shenzhen Meigexiazi CateringManagement Co., Ltd.|Non-related party|190,955.00|W it h i n 1 year|
|Total|—|98,344,213.54|—|

 5) Derecogniziton of Accounts Receivable due to the Transfer of Financial Assets
Not applicable
6) The Amount of the Assets and Liabilities Formed due to the Transfer and the Continued Involvement of Accounts Receivable Not applicable
Othernotes：
Not applicable
2. Other Receivables
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|
|Interest receivable|8,229,503.58||
|Other receivables|1,298,486,323.35|1,128,977,669.02|

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||
|-|-|-|
|Total|1,306,715,826.93|1,128,977,669.02|

 (1) Interest Receivable
1) Category of Interest Receivable
Unit: RMB
||||
|-|-|-|
|Item|Ending balance|Beginning balance|
|Fix time deposit|8,229,503.58||
|Total|8,229,503.58||

2) Significant Overdue Interest
Unit: RMB
||||||
|-|-|-|-|-|
|||||Whether occurred|
|Entity|Ending balance|Overdue time|Overdue reason|impairment and its|
|||||judgment basis|

 Othernotes：
Not applicable
(2) Dividends Receivable
1) Dividends Receivable
Unit: RMB
||||
|-|-|-|
|Item (or investees)|Ending balance|Beginning balance|

2) Significant Dividends Receivable Aged over 1 Year
Unit: RMB
||||||
|-|-|-|-|-|
|||||Whether occurred|
|Item (or investees)|Ending balance|Aging|Reason|impairment and its|
|||||judgment basis|

 Othernotes：
Not applicable
(3) Other Receivables
1) Other Receivables Disclosed by Category
Unit: RMB
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
||Ending balance|||||Beginning balance|||||
||Carrying amount||Bad debt provision|||Carrying amount||Bad debt provision|||
|Category||||Withdra|Carrying|||||Carrying|
|||Proportio|||||Proportio||Withdrawal||
||Amount||Amount|wal|value|Amount||Amount||value|
|||n|||||n||proportion||
|||||proportio|||||||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
|||||n|||||||
|Other receivables|||||||||||
|with significant|||||||||||
|single amount for|121,695,||21,844,7||99,850,58|123,873||28,557,10||95,316,884.|
|||9.14%||17.95%|||59.45%||23.05%||
|which bad debt|318.80||31.77||7.03|,986.03||1.98||05|
|provision separately|||||||||||
|accrued|||||||||||
|Other receivables|||||||||||
|withdrawn bad debt||||||1,044,6|||||
||1,207,50||8,872,83||1,198,635|||11,008,80||1,033,660,7|
|provision according||90.68%||0.73%||69,585.|89.21%||1.05%||
||8,567.54||1.22||,736.32|||0.80||84.97|
|to credit risks||||||77|||||
|characteristics|||||||||||
|Other receivables|||||||||||
|with insignificant|||||||||||
|single amount for|2,415,32||2,415,32|||2,415,3||2,415,326|||
|||0.18%||100.00%|0.00||1.13%||100.00%|0.00|
|which bad debt|6.23||6.23|||26.23||.23|||
|provision separately|||||||||||
|accrued|||||||||||
||||||1,298,486,323.35|1,170,9||||1,128,977,669.02|
||1,331,61||33,132,8|||||41,981,22|||
|Total||100.00%||2.48%||58,898.|100.00%||3.59%||
||9,212.57||89.22|||||9.01|||
|||||||03|||||

Other receivables with significant single amount for which bad debt provision separately accrued at the end of the period
√ Applicable□ Not applicable
Unit: RMB
||||||
|-|-|-|-|-|
||Ending balance||||
|Other receivables (unit)|||||
||Other receivables|Bad debt provision|Withdrawal proportion|Withdrawal reason|
|Shum Yip Properties||||Uncollectible for a long|
||107,628,702.90|7,778,115.87|7.23%||
|Development Co., Ltd.||||period|
|Shanghai Yutong Real|||||
|estate development Co.,|5,676,000.00|5,676,000.00|100.00%|Judgments, irrecoverable|
|Ltd.|||||
|Everglow Development||||Uncollectible for a long|
||3,271,837.78|3,271,837.78|100.00%||
|Limited||||period|
|Dameisha Tourism Center|2,576,445.69|2,576,445.69|100.00%|Suspension of projects|
|Elevated Train Project|2,542,332.43|2,542,332.43|100.00%|Suspension of projects|
|Total|121,695,318.80|21,844,731.77|--|--|

Among these groups, other receivables adopting aging analysis method to withdraw bad debt provision:
√ Applicable□ Not applicable
Unit: RMB
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||
|-|-|-|-|
||Ending balance|||
|Aging||||
||Other receivables|Bad debt provision|Withdrawal proportion|
|Subentry within 1 year||||
|Within 1 year|138,811.00|4,164.33|3.00%|
|Subtotal of within 1 year|138,811.00|4,164.33|3.00%|
|1 to 2 years|601,020.08|60,102.01|10.00%|
|2 to 3 years|43,300.00|12,990.00|30.00%|
|4 to 5 years|42,200.00|33,760.00|80.00%|
|Over 5 years|8,761,814.88|8,761,814.88|100.00%|
|Total|9,587,145.96|8,872,831.22||

Notes to the determination basis for the Group:
Refer to Part XI Financial Statement-V-11 in the Report for details.
Among these groups, other receivables adopting balance percentage method to withdraw bad debt provision
□ Applicable√ Not applicable
Among these groups, other receivables adopting other methods to withdraw bad debt provision:
□ Applicable√ Not applicable
2) Bad Debt Provision Withdrawal, Reversed or Recovered in the Reporting Period
The withdrawal amount of the bad debt provision during the Reporting Period was of RMB0.00; the amount of the reversed or collected part during the Reporting Period was of RMB2,294,834.48.
Significant amount of reversed or recovered bad debt provision:
Unit: RMB
||||
|-|-|-|
|Name of the entity|Reversed or collected amount|Method|

The bad debt provision recovered in the Reporting Period was RMB2,294,834.48; the increase in bad debt provision generated from exchange rate translation of bad debt provision for claimable assets in foreign currency receivable during the Reporting Period was RMB426,767.70. Since the court ruled that the Shenzhen Shengfeng Road Guomao Jewel& Gold Co., Ltd. ended its bankruptcy procedures, the bad debt provision of RMB6,980,273.01 was transferred into other current assets with the original value.
Other receivables transferred out during the Reporting Period
|||||
|-|-|-|-|
|Name of the entity|Nature of otherreceivbales|Amount transferred out||
|||Other receivables|Bad debt provision|
|Shenzhen Shengfeng Road,Guomao Jewel & GoldCo., Ltd.|Rental charge andutilities|6,980,273.01|6,980,273.01|
|Total|—|6,980,273.01|6,980,273.01|

3) Particulars of the Actual Verification of Other Receivables during the Reporting Period
Unit: RMB
|||
|-|-|
|Item|Amount|

Of which, the verification of significant other receivables:
Unit: RMB
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||||
|-|-|-|-|-|-|
||||||Whether occurred|
||||||because of|
|Name of the entity|Nature|Amount|Reason|Procedure||
||||||related-party|
||||||transactions|

 Notes to the verification of other receivables:
Not applicable
4) Other Receivables Classified by Nature
Unit: RMB
||||
|-|-|-|
|Nature|Ending carrying amount|Beginning carrying amount|
|Margin|2,218,894.63|2,218,894.63|
|Pretty cash|174,311.00|86,342.50|
|Payment on behalf|511,835.47|511,835.47|
|Intercourse fund|130,739,271.12|102,707,509.45|
|Account receivable to subsidiary|1,197,974,900.35|1,065,434,315.98|
|Total|1,331,619,212.57|1,170,958,898.03|

 5) Top 5 of the Ending Balance of Other Receivables Collected according to the Arrears Party
Unit: RMB
|||||||
|-|-|-|-|-|-|
|||||Proportion to ending||
||||||Ending balance of|
|Name of the entity|Nature|Ending balance|Aging|balance of total other||
||||||bad debt provision|
|||||receivables%||
|SZPRD Xuzhou||||||
|Dapeng Real Estate|Related party in|||||
|||389,838,221.77|Within 1 year|29.28%||
|Development Co.,|combination scope|||||
|Ltd.||||||
|SZPRD Yangzhou||||||
|Real Estate|Related party in|||||
|||175,939,836.60|Within 1 year|13.21%||
|Development Co.,|combination scope|||||
|Ltd.||||||
|SHUM YIP||||||
|PROPERTIES|Related party in|||||
|||107,628,702.90|Over 5 years|8.08%|7,778,115.87|
|DEVELOPMENT|combination scope|||||
|LIMITED||||||
|Shenzhen||||||
||Related party in|||||
|Huangcheng Property||76,265,906.77|Within 1 year|5.73%||
||combination scope|||||
|Management Co., Ltd.||||||
|Shanghai Yutong Real||||||
||Non-related party|5,676,000.00|Over 5 years|0.43%|5,676,000.00|
|Estate Co., Ltd.||||||
|Total|--|755,348,668.04|--||13,454,115.87|

6) Accounts Receivable Involving Government Subsidies
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Unit: RMB
||||||
|-|-|-|-|-|
||Project of government|||Estimated recovering|
|Name of the entity||Ending balance|Ending aging||
||subsidies|||time, amount and basis|

 Not applicable
7) Derecogniziton of Other Receivables due to the Transfer of Financial Assets
Not applicable
8) The Amount of the Assets and Liabilities Formed due to the Transfer and the Continued Involvement of Other Receivables Not applicable
Othernotes：
Not applicable
3. Long-term Equity Investment
Unit: RMB
||||||||
|-|-|-|-|-|-|-|
||Ending balance|||Beginning balance|||
|Item||Depreciation|||Depreciation||
||Carrying amount||Carrying value|Carrying amount||Carrying value|
|||reserve|||reserve||
|Investment tosubsidiaries|||||||
||269,466,672.93|69,964,000.00|199,502,672.93|231,846,672.93|19,964,000.00|211,882,672.93|
|Investment tojoint ventures andassociatedenterprises|||||||
||58,982,897.38|18,983,614.14|39,999,283.24|57,714,007.10|18,983,614.14|38,730,392.96|
|Total|328,449,570.31|88,947,614.14|239,501,956.17|289,560,680.03|38,947,614.14|250,613,065.89|

 (1) Investment to Subsidiaries
Unit: RMB
||||||||
|-|-|-|-|-|-|-|
||||||Depreciation|Ending balance of|
||Beginningbalance||||||
|Investee||Increase|Decrease|Ending balance|reserve|depreciation|
||||||withdrawn|reserve|
|Shenzhen|||||||
|Huangcheng Real|35,552,671.93|||35,552,671.93|||
|Estate Co., Ltd.|||||||
|SZPRD Real|||||||
|Estate|||||||
||30,950,000.00|||30,950,000.00|||
|Development Co.,|||||||
|Ltd.|||||||
|SZPRD Yangzhou|||||||
|Real Estate|50,000,000.00|||50,000,000.00|||
|Development Co.,|||||||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||||
|-|-|-|-|-|-|
|Ltd.||||||
|Dongguan ITC||||||
|Changsheng Real||||||
|Estate|20,000,000.00||20,000,000.00|||
|Development Co.,||||||
|Ltd.||||||
|Shenzhen||||||
|International Trade||||||
|Center Property|20,000,000.00||20,000,000.00|||
|Management Co.,||||||
|Ltd.||||||
|Shenzhen||||||
|International Trade||||||
||1,600,001.00||1,600,001.00||1,600,000.00|
|Center Catering||||||
|Co., Ltd.||||||
|Shenzhen Property||||||
|Construction||||||
||3,000,000.00||3,000,000.00|||
|Supervision Co.,||||||
|Ltd.||||||
|SZPRD Housing||||||
|Assets Operation||||||
||2,380,000.00|37,620,000.00|40,000,000.00|||
|and Management||||||
|Co., Ltd.||||||
|Zhanjiang||||||
|Shenzhen Real||||||
|Estate|2,530,000.00||2,530,000.00||2,530,000.00|
|Development Co.,||||||
|Ltd.||||||
|Shum Yip||||||
|Properties||||||
||15,834,000.00||15,834,000.00||15,834,000.00|
|Development Co.,||||||
|Ltd.||||||
|SZPRD Xuzhou||||||
|Dapeng Real||||||
|Estate|50,000,000.00||50,000,000.00|50,000,000.00|50,000,000.00|
|Development Co.,||||||
|Ltd.||||||
|Total|231,846,672.93|37,620,000.00|269,466,672.93|50,000,000.00|69,964,000.00|

(2) Investment to Joint Ventures and Associated Enterprises
Unit: RMB
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
|||Increase/decrease||||||||||
||||||||||||Ending|
|||||Gains and|Adjustme|||||||
||||||||Cash|Withdraw|||balance|
|||Additiona||losses|nt of|||||||
||Beginnin||Reduced|||Changes|bonus or|al of||Ending|of|
|Investee||||||||||||
|||l||recognize|other|||||||
||g balance||investmen|||of other|profits|impairme|Other|balance|depreciati|
|||investmen||d under|comprehe|||||||
||||t|||equity|announce|nt|||on|
|||t||the equity|nsive|||||||
||||||||d to issue|provision|||reserve|
|||||method|income|||||||
|I. Joint ventures||||||||||||
|Shenzhen||||||||||||
|Jifa||||||||||||
||33,498,61|||605,227.6||||||34,103,84||
|Warehous||||||||||||
||2.76|||4||||||0.40||
|e Co.,||||||||||||
|Ltd.||||||||||||
|Tianan||||||||||||
|Internatio||||||||||||
|nal||||||||||||
|Building||||||||||||
|Property|5,231,780|||663,662.6||||||5,895,442||
|Managem|.20|||4||||||.84||
|ent||||||||||||
|Company||||||||||||
|of||||||||||||
|Shenzhen||||||||||||
||38,730,39|||1,268,890||||||39,999,28||
|Subtotal||||||||||||
||2.96|||.28||||||3.24||
|II. Associated enterprises||||||||||||
|Shenzhen||||||||||||
|Wufang||||||||||||
|Pottery &|18,983,61|||||||||18,983,61|18,983,61|
|Porcelain|4.14|||||||||4.14|4.14|
|Industrial||||||||||||
|Co., Ltd.||||||||||||
||18,983,61|||||||||18,983,61|18,983,61|
|Subtotal||||||||||||
||4.14|||||||||4.14|4.14|
||57,714,007.10|||1,268,890||||||58,982,897.38|18,983,614.14|
|Total||||||||||||
|||||.28||||||||

（3）Other Notes
None
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 4. Operating Revenue and Cost of Sales
Unit: RMB
||||||
|-|-|-|-|-|
||Reporting Period||Same period of last year||
|Item|||||
||Operating revenue|Cost of sales|Operating revenue|Cost of sales|
|Main operations|1,279,701,193.52|225,828,386.48|974,400,482.05|191,844,816.06|
|Other operations|943,396.23||||
|Total|1,280,644,589.75|225,828,386.48|974,400,482.05|191,844,816.06|

 Othernotes：
None
5. Investment Income
Unit: RMB
||||
|-|-|-|
|Item|Reporting Period|Same period of last year|
|Long-term equity investment income|||
|||433,297,336.35|
|accounted by cost method|||
|Long-term equity investment income|||
||1,268,890.28|1,978,501.84|
|accounted by equity method|||
|Investment income from disposal of|||
||565,632.29|135,696,301.09|
|long-term equity investment|||
|Total|1,834,522.57|570,972,139.28|

 6. Other
Not applicable
XVIII. Supplementary Materials
1. Items and Amounts of Non-recurring Profit or Loss
√ Applicable□ Not applicable
Unit: RMB
||||
|-|-|-|
|Item|Amount|Note|
|Gains/losses on the disposal of non-current|||
||-79,489.58|Disposal of retail assets|
|assets|||
|Government grants recognized in the current|||
|period, except for those acquired in the|||
||165,676.08|Subsidy for stabilizing posts|
|ordinary course of business or granted at|||
|certain quotas or amounts according to the|||

ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018
||||
|-|-|-|
|government‘s unified standards|||
|Other non-operating income and expense||Income from penalty and liquidated|
||1,724,017.41||
|other than the above||damages|
|Less: Income tax effects|448,375.57||
|Total|1,361,828.34|--|

Explain the reasons if the Company classifies an item as an non-recurring gain/loss according to the definition in the Explanatory Announcement No. 1 on Information Disclosure for Companies Offering Their Securities to thePublic—Non-recurring Gains and Losses, or classifies any extraordinary gain/loss item mentioned in the said explanatory announcement as a recurrent gain/loss item□ Applicable√Not applicable
2. Return on Equity and Earnings Per Share
|||||
|-|-|-|-|
|||EPS (Yuan/share)||
|Profit as of Reporting Period|Weighted average ROE (%)|||
|||EPS-basic|EPS-diluted|
|Net profit attributable to ordinary||0.9945|0.9945|
||18.94%|||
|shareholders of the Company||||
|Net profit attributable to ordinary||||
|shareholders of the Company after||||
||18.89%|0.9923|0.9923|
|deduction of non-recurring profit or||||
|loss||||

3. Differences between Accounting Data under Domestic and Overseas Accounting Standards
(1) Differences of Net Profit and Net Assets Disclosed in Financial Reports Prepared under International and Chinese Accounting Standards
□ Applicable√ Not applicable
(2) Differences of Net profit and Net assets Disclosed in Financial Reports Prepared under Overseas and Chinese Accounting Standards
□ Applicable√ Not applicable
(3) Explain Reasons for the Differences between Accounting Data under Domestic and Overseas Accounting Standards; for any Adjustment Made to the Difference Existing in the Data Audited by the Foreign Auditing Agent, Such Foreign AuditingAgent’s Name Shall Be Clearly Stated
Not applicable
4. Other
Comparative data
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 In the Reporting Period, for the sake of comparability of information disclosed, the Company made appropriate adjustments to some of the comparable data for 2017 in the form of the disclosure for the Reporting Period.
ShenZhen Properties& Resources Development (Group) Ltd. Annual Report 2018 Part XII Documents Available for Reference
I The financial statements with the signatures and seals of the legal representative and the heads of financial affairs and the financial department;
II The original copy of the IndependentAuditor‘s Report with the seal of the CPA firm as well as the signatures and seals of the certified public accountants; and
III The originals of all theCompany‘s announcements and documents disclosed on the designated media during the Reporting Period.