Shenzhen Textile (Holdings) Co., Ltd.
Auditor’s Report
Qin Xin Shen Zi(2016)]No.1564
Table of contents
Contents Page
I.Auditor’s Report
II. Audited Financial Statements
1.Consolidated Balance sheet
2．Parent company Balance sheet
3. Consolidated Income statement
4. Parent company Income statement
5. Consolidated Cash flow statement
6. Parent company Cash flow statement
7. Consolidated Statement on Change inOwners’
Equity
8. Statement of change inowner’s Equity of the Parent
Company
III. Notes to financial statements
Peking Certified Public Accountants
Add:11/F,Zhongtang Building,No.110, Xizhimen Street, Beijing
Tel：（86-10）68360123
Fax：（86-10）68360123-3000
Zip Code:100044
Auditor’s Report
Qin Xin Shen Zi(2016)]No.1564 To all shareholders of Shenzhen Textile (Holdings) Co.,Ltd.：
We audited accompanying financial statements of Shenzhen Textile (Holdings) Co., Ltd.(the “Company), including Consolidated and parent Company balance sheet as of December 31, 2015, and the Parent Company and Consolidated income statement, The parent company and Consolidated cash flow statement ,The parent Company and Consolidated Statements of Changes in equity for the year then ended, and the notes to the financial statements .
I. The responsibility of the Management for the financial statements
Shenzhen Textile (Holdings) Co., Ltd’s. management is responsible for the preparation and fair presentation of these financial statements this responsibility includes : (1) Prepare the financial statements according to business enterprises regulation, so that making reasonable accounting estimate;(2) Design, implementation and maintenance of internal control related to the preparation of financial statements so that financial statements are free from material misstatement caused by fraudulent practices or errors.
II. Responsibility of certified public accountants
We are responsible for expressing opinions on financial statements based on our audit. We conducted audit in accordance with the audit criteria for Chinese certified public accountants. The audit criteria for Chinese certified public accountants require us to abide by professional ethics, plan and conduct audit to obtain reasonable assurance as to whether financial statements are free from material misstatement.
Audit involves carrying out audit procedure to obtain the audit evidences about the amounts and disclosure of financial statements. The selected audit procedure relies on the judgment of certified public accountants,
including the appraisal of risk of material misstatement of financial statements used by fraudulent practices or errors. While appraising risks, we considered the internal control related to the preparation of financial statements to design proper audit procedure. The audit also includes the appraisal of suitability of accounting policies selected by the management, the reasonableness of accounting estimate and the overall presentation of financial statements.
We believe that the audit evidences obtained by us are full and appropriate and provide a basis for expressing audit opinion.
III. Audit opinion
In our opinion, the financial statements of the Company Wharf present fairly, in all material respects, the
company’s and consolidated financial position as of 31 December 2015, and theCompany’s and consolidated results of operations and cash flows for the year then ended in accordance with Accounting Standards for
Business Enterprises.
Peking Certified Public Accountants(Special General Partnership)
Chinese C.P.A. Xiao Yi
Chinese C.P.A. Lan Tao
March 29,2016
Financial Statements
\Statement in Financial Notes are carried in RMB/CNY
1.Consolidated Balance sheet
Prepared by : Shenzhen Textile (Holdings) Co., Ltd.
In RMB
||||
|-|-|-|
|Items|Year-end balance|Year-beginning balance|
|Current asset：|||
|Monetary fund|752,314,871.53|1,101,771,561.28|
|Settlement provision|||
|Outgoing call loan|||
|Financial assets measured at fair value|||
|with variations accounted into current|||
|income account|||
|Derivative financial assets|||
|Bill receivable|18,841,745.16|43,412,635.19|
|Account receivable|182,766,372.05|156,123,570.35|
|Prepayments|7,853,818.19|27,075,094.81|
|Insurance receivable|||
|Reinsurance receivable|||
|Provisions of Reinsurance contracts|||
|receivable|||
|Interest receivable|30,298,938.80|13,357,311.32|
|Dividend receivable|||
|Other account receivable|45,133,672.10|41,843,377.39|
|Repurchasing of financial assets|||
|Inventories|308,775,044.88|230,659,122.24|
|Assets held for sales|||
|Non-current asset due in 1 year|||
|Other current asset|513,553,675.47|61,748,415.41|
|Total of current assets|1,859,538,138.18|1,675,991,087.99|
|Non-current assets：|||
|Loans and payment on other’s behalf|||
|disbursed|||
|Disposable financial asset|43,241,524.06|87,592,297.11|

||||
|-|-|-|
|Expired investment in possess|||
|Long-term receivable|||
|Long term share equity investment|22,879,269.06|20,795,057.33|
|Property investment|134,389,963.05|140,905,275.45|
|Fixed assets|790,019,487.16|824,871,367.33|
|Construction in progress|75,803,586.70|79,822,149.34|
|Engineering material|||
|Fixed asset disposal|||
|Production physical assets|||
|Gas & petrol|||
|Intangible assets|40,626,936.34|41,771,402.89|
|R & D petrol|||
|Goodwill||9,614,758.55|
|Long-germ expenses to be amortized|633,541.50|560,877.06|
|Differed income tax asset|2,262,532.65|2,607,644.23|
|Other non-current asset|||
|Total of non-current assets|1,109,856,840.52|1,208,540,829.29|
|Total of assets|2,969,394,978.70|2,884,531,917.28|
|Current liabilities|||
|Short-term loans|53,866,521.87|24,676,594.72|
|Loan from Central Bank|||
|Deposit received and hold for others|||
|Call loan received|||
|Financial liabilities measured at fair|||
|value with variations accounted into|||
|current income account|||
|Derivative financial liabilities|||
|Bill payable|||
|Account payable|227,528,808.60|153,026,682.35|
|Advance payment|28,199,415.11|41,135,510.00|
|Selling of repurchased financial assets|||
|Fees and commissions receivable|||
|Employees’ wage payable|35,307,822.40|37,736,705.46|
|Tax payable|14,682,643.09|8,912,594.55|
|Interest payable|39,088,887.96|33,037,218.68|

||||
|-|-|-|
|Dividend payable|||
|Other account payable|125,775,723.80|112,654,863.06|
|Reinsurance fee payable|||
|Insurance contract provision|||
|Entrusted trading of securities|||
|Entrusted selling of securities|||
|Liabilities held for sales|||
|Non-current liability due in 1 year|40,000,000.00|75,346,136.30|
|Other current liability|||
|Total of current liability|564,449,822.83|486,526,305.12|
|Non-current liabilities：|||
|Long-term loan|120,000,000.00|124,653,863.70|
|Bond payable|||
|Including：preferred stock|||
|Sustainable debt|||
|Long-term payable|||
|Long-term payable employees’s|||
|remuneration|||
|Special payable|||
|Expected liabilities|||
|Deferred income|99,524,165.58|66,546,079.96|
|Deferred income tax liability|10,851,444.74|10,556,420.24|
|Other non-current liabilities|||
|Total non-current liabilities|230,375,610.32|201,756,363.90|
|Total of liability|794,825,433.15|688,282,669.02|
|Owners’ equity|||
|Share capital|506,521,849.00|506,521,849.00|
|Other equity instruments|||
|Including：preferred stock|||
|Sustainable debt|||
|Capital reserves|1,585,130,051.37|1,585,130,051.37|
|Less：Shares in stock|||
|Other comprehensive income|3,212,187.35|33,389,117.46|
|Special reserves|||

||||
|-|-|-|
|Surplus reserves|70,539,319.86|64,403,027.10|
|Common risk provision|||
|Undistributed profit|9,166,137.97|6,805,203.33|
|Total of owner’s equity belong to the|||
||2,174,569,545.55|2,196,249,248.26|
|parent company|||
|Minority shareholders’ equity|||
|Total of owners’ equity|2,174,569,545.55|2,196,249,248.26|
|Total of liabilities and owners’ equity|2,969,394,978.70|2,884,531,917.28|

 Legal Representative: Zhu Jun Person in charge ofaccounting：Zhu Jun Accounting Dept Leader: Mu Linying 2. Balance sheet of Parent Company
In RMB
||||
|-|-|-|
|Items|Year-end balance|Year-beginning balance|
|Current asset：|||
|Monetary fund|271,582,749.03|457,379,886.16|
|Financial assets measured at fair value|||
|with variations accounted into current|||
|income account|||
|Derivative financial assets|||
|Bill receivable||1,800,000.00|
|Account receivable|819,054.57|468,887.97|
|Prepayments|1,754,880.00|2,771,374.00|
|Interest receivable|22,294,015.02|10,640,957.35|
|Dividend receivable|7,798,378.51||
|Other account receivable|72,543,709.78|64,581,392.46|
|Inventories|||
|Assets held for sales|||
|Non-current asset due in 1 year|||
|Other current asset|260,000,000.00||
|Total of current assets|636,792,786.91|537,642,497.94|
|Non-current assets：|||
|Disposable financial asset|41,741,524.06|84,292,297.11|
|Expired investment in possess|||
|Long-term receivable|||

||||
|-|-|-|
|Long term share equity investment|1,779,103,035.67|1,797,651,565.42|
|Property investment|126,873,096.51|132,976,776.39|
|Fixed assets|26,579,978.92|27,002,348.21|
|Construction in progress|38,792,110.90|31,482,502.19|
|Engineering material|||
|Fixed asset disposal|||
|Production physical assets|||
|Gas & petrol|||
|Intangible assets|1,378,688.61|1,627,715.16|
|R & D petrol|||
|Goodwill|||
|Long-germ expenses to be amortized|||
|Deferred income tax asset|2,556,126.29|3,061,417.30|
|Other non-current asset|||
|Total of non-current assets|2,017,024,560.96|2,078,094,621.78|
||2,653,817,347.87|2,615,737,119.72|
|Total of assets|||
|Current liabilities|||
|Short-term loans|||
|Financial liabilities measured at fair|||
|value with variations accounted into|||
|current income account|||
|Derivative financial liabilities|||
|Bill payable|||
|Account payable|411,743.57|411,743.57|
|Advance payment|639,024.58|639,024.58|
|Employees’ wage payable|7,299,686.80|5,878,352.45|
|Tax payable|12,558,340.06|6,660,135.95|
|Interest payable|||
|Dividend payable|||
|Other account payable|77,332,555.09|67,479,912.27|
|Liabilities held for sales|||
|Non-current liability due in 1 year|||
|Other current liability|||
|Total of current liability|98,241,350.10|81,069,168.82|
|Non-current liabilities：|||

||||
|-|-|-|
|Long-term loan|||
|Bond payable|||
|Including：preferred stock|||
|Sustainable debt|||
|Long-term payable|||
|Employees’ wage payable|||
|Special payable|||
|Expected liabilities|||
|Deferred income|||
||278,469.57|10,556,420.24|
|Deferred income tax liability|||
|Other non-current liabilities|||
|Total of Non-current liabilities|278,469.57|10,556,420.24|
|Total of liability|98,519,819.67|91,625,589.06|
|Owners’ equity|||
|Share capital|506,521,849.00|506,521,849.00|
|Other equity instrument|||
|Including：preferred stock|||
|Sustainable debt|||
|Capital reserves|1,576,547,069.58|1,576,547,069.58|
|Less：Shares in stock|||
|Other comprehensive income|3,212,187.35|33,389,117.46|
|Special reserves|||
|Surplus reserves|70,539,319.86|64,403,027.10|
|Undistributed profit|398,477,102.41|343,250,467.52|
|Total of owners’ equity|2,555,297,528.20|2,524,111,530.66|
|Total of liabilities and owners’ equity|2,653,817,347.87|2,615,737,119.72|

 Legal Representative: Zhu Jun Person in charge ofaccounting：Zhu Jun Accounting Dept Leader: Mu Linying 3.Consolidated Income Statement
In RMB
||||
|-|-|-|
|Items|Report period|Same period of the previous year|
|I. Income from the key business|1,226,746,791.62|1,210,952,548.57|
|Incl：Business income|1,226,746,791.62|1,210,952,548.57|
|Interest income|||

||||
|-|-|-|
|Insurance fee earned|||
|Fee and commission received|||
|II. Total business cost|1,302,269,276.48|1,317,382,360.52|
|Incl：Business cost|1,142,511,012.84|1,154,743,462.84|
|Interest expense|||
|Fee and commission paid|||
|Insurance discharge payment|||
|Net claim amount paid|||
|Insurance policy dividend paid|||
|Insurance policy dividend paid|||
|Reinsurance expenses|||
|Business tax and surcharge|7,624,971.76|7,905,969.24|
|Sales expense|11,743,914.73|14,067,625.17|
|Administrative expense|103,044,704.30|119,496,105.45|
|Financial expenses|-24,448,318.10|-30,392,840.60|
|Asset impairment loss|61,792,990.95|51,562,038.42|
|Add：Gains from change of fir value|||
|（“-”for loss）|||
|Investment gain（“-”for loss）|94,812,557.58|23,294,636.54|
|Incl: investment gains from affiliates|2,431,042.20|1,788,818.78|
|Gains from currency exchange（“-”for|||
|loss）|||
|III. Operational profit（“-”for loss）|19,290,072.72|-83,135,175.41|
|Add ：Non-operational income|24,122,339.62|21,159,989.26|
|Including：Income from disposal of|||
||235,533.62|135,925.51|
|non-current assets|||
|Less：Non business expenses|260,665.61|83,757.49|
|Incl：Loss from disposal of non-current|||
||260,642.59|83,643.89|
|assets|||
|IV.Total profit(“-”for loss)|43,151,746.73|-62,058,943.64|
|Less：Income tax expenses|34,654,519.33|51,532,384.62|
|V. Net profit|8,497,227.40|-113,591,328.26|
|Net profit attributable to the owners of|||
||8,497,227.40|-113,591,328.26|
|parent company|||
|Minority shareholders’ equity|||

||||
|-|-|-|
|VI. Other comprehensive income|-30,176,930.11|9,854,344.17|
|Net of profit of other comprehensive inco|||
|me attributable to owners of the parent co|-30,176,930.11|9,854,344.17|
|mpany.|||
|（I）Other comprehensive income items|||
|that will not be reclassified into|||
|gains/losses in the subsequent|||
|accounting period|||
|1.Re-measurement of defined benefit pla|||
|ns of changes in net debt or net assets|||
|2.Other comprehensive income under the|||
|equity method investee can not be reclass|||
|ified into profit or loss.|||
|（II）|||
||-30,176,930.11|9,854,344.17|
|Other comprehensive income that will b|||
|e reclassified into profit or loss.|||
|1.Other comprehensive income under the|||
|equity method investee can be reclassifie|||
|d into profit or loss.|||
|2.Gains and losses from changes in fair v|||
||-30,375,486.14|9,886,627.82|
|alue available for sale financial assets|||
|3.Held-to-maturity investments reclassifi|||
|ed to gains and losses of available for sal|||
|e financial assets|||
|4.The effective portion of cash flow hedg|||
|es and losses|||
|5.Translation differences in currency fina|||
||198,556.03|-32,283.65|
|ncial statements|||
|6.Other|||
|7.Net of profit of other comprehensive i|||
|ncome attributable to Minority|||
|shareholders’ equity|||
|VII. Total comprehensive income|-21,679,702.71|-103,736,984.09|
|Total comprehensive income attributable|||
||-21,679,702.71|-103,736,984.09|
|to the owner of the parent company|||
|Total comprehensive income attributable|||
|minority shareholders|||
|VIII. Earnings per share|||
|（I）Basic earnings per share|0.02|-0.22|
|(II)Diluted earnings per share|0.02|-0.22|

The current business combination under common control, the net profits of the combined party before achieved ne
t profit of RMB 0, last period the combined party realized RMB 0.
Legal Representative: Zhu Jun Person in charge ofaccounting：Zhu Jun Accounting Dept Leader: Mu Linying 4. Income statement of the Parent Company
In RMB
||||
|-|-|-|
|Items|Amount in this period|Amount in last period|
|I. Income from the key business|64,473,351.83|63,124,318.89|
|Incl：Business cost|12,333,803.24|12,482,856.41|
|Business tax and surcharge|5,494,540.21|5,530,512.60|
|Sales expense|||
|Administrative expense|28,207,859.60|31,313,410.67|
|Financial expenses|-19,528,024.29|-15,035,734.73|
|Asset impairment loss|14,939,945.14|-5,163,448.04|
|Add：Gains from change of fir value|||
|（“-”for loss）|||
|Investment gain（“-”for loss）|58,283,064.18|22,062,282.28|
|Incl: investment gains from affiliates|2,431,042.20|1,788,818.79|
|II. Operational profit（“-”for loss）|81,308,292.11|56,059,004.26|
|Add ：Non-operational income|2,047,648.92|3,993,511.97|
|Including：Income from disposal of|||
||235,233.62||
|non-current assets|||
|Less：Non business expenses|13,020.92||
|Incl：Loss from disposal of non-current|||
||13,020.92||
|assets|||
|III.Total profit(“-”for loss)|83,342,920.11|60,052,516.23|
|Less：Income tax expenses|21,979,992.46|14,039,596.21|
|IV. Net profit（“-”for net loss）|61,362,927.65|46,012,920.02|
|V.Net of profit of other comprehensive i|||
||-30,176,930.11|9,854,344.17|
|ncome|||
|（I）Other comprehensive income items|||
|that will not be reclassified into|||
|gains/losses in the subsequent|||
|accounting period|||
|1.Re-measurement of defined benefit pl|||
|ans of changes in net debt or net assets|||
|2.Other comprehensive income under th|||
|e equity method investee can not be recl|||
|assified into profit or loss.|||

||||
|-|-|-|
|（II）|||
|Other comprehensive income that will b|-30,176,930.11|9,854,344.17|
|e reclassified into profit or loss.|||
|1.Other comprehensive income under th|||
|e equity method investee can be reclassi|||
|fied into profit or loss.|||
|2.Gains and losses from changes in fair|||
||-30,375,486.14|9,886,627.82|
|value available for sale financial assets|||
|3.Held-to-maturity investments reclassif|||
|ied to gains and losses of available for s|||
|ale financial assets|||
|4.The effective portion of cash flow hed|||
|ges and losses|||
|5.Translation differences in currency fin|||
||198,556.03|-32,283.65|
|ancial statements|||
|6.Other|||
|VI. Total comprehensive income|31,185,997.54|55,867,264.19|
|VII. Earnings per share：|||
|（I）Basic earnings per share|||
|(II)Diluted earnings per share|||

Legal Representative: Zhu Jun Person in charge ofaccounting：Zhu Jun Accounting Dept Leader: Mu Linying 5. Consolidated Cash flow statement
In RMB
||||
|-|-|-|
|Items|Amount in this period|Amount in last period|
|I.Cash flows from operating activities|||
|Cash received from sales of goods or|||
||1,247,874,437.38|1,225,517,209.48|
|rending of services|||
|Net increase of customer deposits|||
|and capital kept for brother company|||
|Net increase of loans from central bank|||
|Net increase of inter-bank loans from|||
|other financial bodies|||
|Cash received against original insurance|||
|contract|||
|Net cash received from reinsurance|||

||||
|-|-|-|
|business|||
|Net increase of client deposit and|||
|investment|||
|Net increase of amount from disposal|||
|financial assets that measured by fair|||
|value and with variation reckoned into|||
|current gains/losses|||
|Net increase of inter-bank fund|||
|received|||
|Net increase of trade financial asset|||
|disposal|||
|Net increase of repurchasing business|||
|Tax returned|68,431,596.59|77,012,597.33|
|Other cash received from business|||
||95,526,183.51|75,754,386.32|
|operation|||
|Sub-total of cash inflow|1,411,832,217.48|1,378,284,193.13|
|Cash paid for purchasing of|||
||1,157,396,626.23|1,165,323,109.41|
|merchandise and services|||
|Net increase of client trade and advance|||
|Net increase of savings n central bank|||
|and brother company|||
|Cash paid for original contract claim|||
|Cash paid for interest, processing fee|||
|and commission|||
|Cash paid for policy dividend|||
|Cash paid to staffs or paid for staffs|128,028,856.25|134,633,573.32|
|Taxes paid|36,667,118.26|80,706,284.79|
|Other cash paid for business activities|50,155,116.37|46,322,719.66|
|Sub-total of cash outflow from business|||
||1,372,247,717.11|1,426,985,687.18|
|activities|||
|Cash flow generated by business|||
||39,584,500.37|-48,701,494.05|
|operation, net|||
|II.Cash flow generated by investing|||
|Cash received from investment|||
||89,640,023.95|21,307,417.68|
|retrieving|||
|Cash received as investment gains|4,871,581.37|3,298,701.39|
|Net cash retrieved from disposal of|||
||2,950.00|118,690.00|
|fixed assets, intangible assets, and other|||

||||
|-|-|-|
|long-term assets|||
|Net cash received from disposal of|||
|||100,386,000.00|
|subsidiaries or other operational units|||
|Other investment-related cash received|30,591,780.82|202,371,196.29|
|Sub-total of cash inflow due to|||
||125,106,336.14|327,482,005.36|
|investment activities|||
|Cash paid for construction of|||
|fixed assets, intangible assets|17,134,529.58|48,919,307.85|
|and other long-term assets|||
|Cash paid as investment|||
|Net increase of loan against pledge|||
|Net cash received from subsidiaries and|||
|other operational units|||
|Other cash paid for investment|||
||490,059,223.58|100,000,000.00|
|activities|||
|Sub-total of cash outflow due to|||
||507,193,753.16|148,919,307.85|
|investment activities|||
|Net cash flow generated by investment|-382,087,417.02|178,562,697.51|
|III.Cash flow generated by financing|||
|Cash received as investment|||
|Incl: Cash received as investment from|||
|minor shareholders|||
|Cash received as loans|244,759,302.00|160,095,760.79|
|Cash received from bond placing|||
|Other financing –related ash received||279.31|
|Sub-total of cash inflow from financing|||
||244,759,302.00|160,096,040.10|
|activities|||
|Cash to repay debts|255,569,374.85|135,419,166.07|
|Cash paid as dividend, profit, or|||
||792,115.53|402,425.29|
|interests|||
|Incl: Dividend and profit paid by|||
|subsidiaries to minor shareholders|||
|Other cash paid for financing activities|||
|Sub-total of cash outflow due to|||
||256,361,490.38|135,821,591.36|
|financing activities|||
|Net cash flow generated by financing|-11,602,188.38|24,274,448.74|
|IV. Influence of exchange rate|4,531,621.61|182,755.14|

||||
|-|-|-|
|alternation on cash and cash equivalents|||
|V.Net increase of cash and cash|||
||-349,573,483.42|154,318,407.34|
|equivalents|||
|Add: balance of cash and cash|||
||1,098,232,359.02|943,913,951.68|
|equivalents at the beginning of term|||
|VI ..Balance of cash and cash|||
||748,658,875.60|1,098,232,359.02|
|equivalents at the end of term|||

Legal Representative: Zhu Jun Person in charge ofaccounting：Zhu Jun Accounting Dept Leader: Mu Linying 6. Cash flow statement of the Parent Company
In RMB
||||
|-|-|-|
|Items|Amount in this period|Amount in last period|
|I.Cash flows from operating activities|||
|Cash received from sales of goods or|||
||63,862,579.19|62,399,316.68|
|rending of services|||
|Tax returned|||
|Other cash received from business|||
||18,819,989.01|20,495,286.17|
|operation|||
|Sub-total of cash inflow|82,682,568.20|82,894,602.85|
|Cash paid for purchasing of|||
||4,835,838.70|6,021,459.84|
|merchandise and services|||
|Cash paid to staffs or paid for staffs|14,524,922.32|17,957,199.61|
|Taxes paid|22,477,306.54|68,706,268.66|
|Other cash paid for business activities|9,551,257.85|10,533,550.85|
|Sub-total of cash outflow from business|||
||51,389,325.41|103,218,478.96|
|activities|||
|Cash flow generated by business|||
||31,293,242.79|-20,323,876.11|
|operation, net|||
|II.Cash flow generated by investing|||
|Cash received from investment|||
||46,395,738.95|19,302,132.19|
|retrieving|||
|Cash received as investment gains|3,777,417.02|2,048,981.52|
|Net cash retrieved from disposal of|||
|fixed assets, intangible assets, and other|||
|long-term assets|||
|Net cash received from disposal of||100,386,000.00|

||||
|-|-|-|
|subsidiaries or other operational units|||
|Other investment-related cash received|30,591,780.82|567,210.00|
|Sub-total of cash inflow due to|||
||80,764,936.79|122,304,323.71|
|investment activities|||
|Cash paid for construction of|||
|fixed assets, intangible assets|7,855,316.71|10,228,512.00|
|and other long-term assets|||
|Cash paid as investment|||
|Net cash received from subsidiaries and|||
|other operational units|||
|Other cash paid for investment|||
||290,000,000.00||
|activities|||
|Sub-total of cash outflow due to|||
||297,855,316.71|10,228,512.00|
|investment activities|||
|Net cash flow generated by investment|-217,090,379.92|112,075,811.71|
|III.Cash flow generated by financing|||
|Cash received as investment|||
|Cash received as loans|||
|Cash received from bond placing|||
|Other financing –related ash received||279.31|
|Sub-total of cash inflow from financing|||
|||279.31|
|activities|||
|Cash to repay debts|||
|Cash paid as dividend, profit, or|||
|interests|||
|Other cash paid for financing activities|||
|Sub-total of cash outflow due to|||
|financing activities|||
|Net cash flow generated by financing||279.31|
|IV. Influence of exchange rate|||
|||6,989.91|
|alternation on cash and cash equivalents|||
|V.Net increase of cash and cash|||
||-185,797,137.13|91,759,204.82|
|equivalents|||
|Add: balance of cash and cash|||
||457,379,886.16|365,620,681.34|
|equivalents at the beginning of term|||
|VI ..Balance of cash and cash|||
||271,582,749.03|457,379,886.16|
|equivalents at the end of term|||

Legal Representative: Zhu Jun Person in charge ofaccounting：Zhu Jun Accounting Dept Leader: Mu Linying 7. Consolidated Statement on Change inOwners’ Equity
Amount in this period
In RMB
|||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
||Amount in this period|||||||||||||
||Owner’s equity Attributable to the Parent Company|||||||||||||
|||Other Equity||||||||||||
|||||||||||||Minor||
|||instrusment|||||Other|||Commo|||Total of|
|Items||||||||||||||
||Share|||||Less:||Speciali|||Attribut|shareho||
||||||Capital||Compre||Surplus|n risk|||owners’|
||Capita|prefer||||Shares||zed|||able|lders’||
||||Sustai||reserves||hensive||reserves|provisio|||equity|
||l|red||Other||in stock||reserve|||profit|equity||
||||nable||||Income|||n||||
|||stock||||||||||||
||||debt|||||||||||
||506,52||||1,585,1||||||||2,196,2|
|I.Balance at the|||||||33,389,||64,403,||6,805,2|||
||1,849.||||30,051.||||||||49,248.|
|end of last year|||||||117.46||027.10||03.33|||
||00||||37||||||||26|
|Add: Change of||||||||||||||
|accounting||||||||||||||
|policy||||||||||||||
|Correcting of||||||||||||||
|previous errors||||||||||||||
|Merger of entities||||||||||||||
|under common||||||||||||||
|control||||||||||||||
|Other||||||||||||||
|II.Balance at the|506,52||||1,585,1||||||||2,196,2|
||||||||33,389,||64,403,||6,805,2|||
|beginning of|1,849.||||30,051.||||||||49,248.|
||||||||117.46||027.10||03.33|||
|current year|00||||37||||||||26|
|III.Changed in the|||||||-30,176,||6,136,2||2,360,9||-21,679,|
|current year|||||||930.11||92.76||34.64||702.71|
|（1）Total||||||||||||||
||||||||-30,176,||||8,497,2||-21,679,|
|comprehensive||||||||||||||
||||||||930.11||||27.40||702.71|
|income||||||||||||||
|（II）Investment||||||||||||||
|or decreasing of||||||||||||||
|capital by owners||||||||||||||
|1．Ordinary Share||||||||||||||
|s invested by hare||||||||||||||
|holders||||||||||||||

||||
|-|-|-|
|2．Holders of oth|||
|er equity instrume|||
|nts invested capital|||
|3．Amount of|||
|shares paid and|||
|accounted as|||
|owners’ equity|||
|4．Other|||
|（III）Profit|6,136,2|-6,136,2|
|allotment|92.76|92.76|
|1.Providing of|6,136,2|-6,136,2|
|surplus reserves|92.76|92.76|
|2.Providing of|||
|common risk|||
|provisions|||
|3．Allotment to the|||
|owners (or|||
|shareholders)|||
|4．Other|||
|(IV) Internal|||
|transferring of|||
|owners’ equity|||
|1. Capitalizing of|||
|capital reserves (or|||
|to capital shares)|||
|2. Capitalizing of|||
|surplus reserves|||
|(or to capital|||
|shares)|||
|3．Making up|||
|losses by surplus|||
|reserves.|||
|4. Other|||
|(V). Special|||
|reserves|||
|1. Provided this|||
|year|||
|2．Used this term|||
|（VI）Other|||

||||||||
|-|-|-|-|-|-|-|
||506,52|1,585,1||||2,174,569,545.55|
|IV. Balance at the|||3,212,1|70,539,|9,166,1||
||1,849.|30,051.|||||
|end of this term|||87.35|319.86|37.97||
||00|37|||||

 Amount in last year
In RMB
|||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
||Amount in last year|||||||||||||
||Owner’s equity Attributable to the Parent Company|||||||||||||
|||Other Equity||||||||||Minor||
|||instrusment|||||Other|||Commo|||Total of|
|Items||||||||||||||
|||||||||||||shareho||
||ShareCapita|prefer|||Capital|Less:Shares|Compre|Specialized|Surplus|n risk|Attributable|lders’|owners’|
||l|red|Sustainable|Other|reserves|in stock|hensive|reserve|reserves|provisio|profit|equity|equity|
|||stock|debt||||Income|||n||||
||506,52||||1,582,9||||||||2,297,8|
|I.Balance at the|||||||23,534,||59,801,||124,997|||
||1,849.||||90,396.||||||||46,577.|
|end of last year|||||||773.29||735.10||,823.59|||
||00||||13||||||||11|
|Add: Change of||||||||||||||
|accounting||||||||||||||
|policy||||||||||||||
|Correcting of||||||||||||||
|previous errors||||||||||||||
|Merger of entities||||||||||||||
|under common||||||||||||||
|control||||||||||||||
|Other||||||||||||||
|II.Balance at the|506,52||||1,582,9||||||||2,297,8|
||||||||23,534,||59,801,||124,997|||
|beginning of|1,849.||||90,396.||||||||46,577.|
||||||||773.29||735.10||,823.59|||
|current year|00||||13||||||||11|
||||||||||||-118,19||-101,59|
|III.Changed in the|||||2,139,6||9,854,3||4,601,2|||||
||||||||||||2,620.2||7,328.8|
|current year|||||55.24||44.17||92.00|||||
||||||||||||6||5|
|（1）Total|||||||||||-113,59||-103,73|
||||||||9,854,3|||||||
|comprehensive|||||||||||1,328.2||6,984.0|
||||||||44.17|||||||
|income|||||||||||6||9|
|（II）Investment||||||||||||||
|or decreasing of||||||||||||||
|capital by owners||||||||||||||
|1．Ordinary Share||||||||||||||
|s invested by hare||||||||||||||

||||||
|-|-|-|-|-|
|holders|||||
|2．Holders of oth|||||
|er equity instrume|||||
|nts invested capital|||||
|3．Allotment to the|||||
|owners (or|||||
|shareholders)|||||
|4．Other|||||
|（III）Profit||4,601,2|-4,601,2||
|allotment||92.00|92.00||
|1.Providing of||4,601,2|-4,601,2||
|surplus reserves||92.00|92.00||
|2.Providing of|||||
|common risk|||||
|provisions|||||
|3．Allotment to the|||||
|owners (or|||||
|shareholders)|||||
|4．Other|||||
|(IV) Internal|||||
|transferring of|||||
|owners’ equity|||||
|1. Capitalizing of|||||
|capital reserves (or|||||
|to capital shares)|||||
|2. Capitalizing of|||||
|surplus reserves|||||
|(or to capital|||||
|shares)|||||
|3．Making up|||||
|losses by surplus|||||
|reserves.|||||
|4. Other|||||
|(V) Special|||||
|reserves|||||
|1. Provided this|||||
|year|||||
|2．Used this term|||||
|（VI）Other|2,139,6|||2,139,6|

||||||||
|-|-|-|-|-|-|-|
|||55.24||||55.24|
||506,52|1,585,1||||2,196,2|
|IV. Balance at the|||33,389,|64,403,|6,805,2||
||1,849.|30,051.||||49,248.|
|end of this term|||117.46|027.10|03.33||
||00|37||||26|

 Legal Representative: Zhu Jun Person in charge ofaccounting：Zhu Jun Accounting Dept Leader: Mu Linying 8. Statement of change inowner’s Equity of the Parent Company
Amount in this period
In RMB
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
||Amount in this period|||||||||||
|||Other Equity instrusment||||||||||
||||||||Other|||||
|||||Other||Less:|||||Total of|
|Items|Share||||Capital||Compreh|Specialize|Surplus|Attribut||
|||preferre|Sustain|||Shares in||||able|owners’|
||Capital||||reserves||ensive|d reserve|reserves|||
|||d stock|able|||stock||||profit|equity|
||||||||Income|||||
||||debt|||||||||
||506,521,||||1,576,547||33,389,11||64,403,02|343,250|2,524,111|
|I.Balance at the||||||||||||
||849.00||||,069.58||7.46||7.10|,467.52|,530.66|
|end of last year||||||||||||
|Add: Change of||||||||||||
|accounting||||||||||||
|policy||||||||||||
|Correcting of||||||||||||
|previous errors||||||||||||
|Other||||||||||||
|II.Balance at the||||||||||||
||506,521,||||1,576,547||33,389,11||64,403,02|343,250|2,524,111|
|beginning of||||||||||||
||849.00||||,069.58||7.46||7.10|,467.52|,530.66|
|current year||||||||||||
|III.Changed in the|||||||-30,176,9||6,136,292|55,226,|31,185,99|
|current year|||||||30.11||.76|634.89|7.54|
|（1）Total||||||||||||
||||||||-30,176,9|||61,362,|31,185,99|
|comprehensive||||||||||||
||||||||30.11|||927.65|7.54|
|income||||||||||||
|（II）Investment or||||||||||||
|decreasing of||||||||||||
|capital by owners||||||||||||
|1．Ordinary Share||||||||||||
|s invested by hareh||||||||||||
|olders||||||||||||
|2．Holders of oth||||||||||||

||||||||
|-|-|-|-|-|-|-|
|er equity instrume|||||||
|nts invested capital|||||||
|3．Allotment to the|||||||
|owners (or|||||||
|shareholders)|||||||
|4．Other|||||||
|（III）Profit||||6,136,292|-6,136,2||
|allotment||||.76|92.76||
|1.Providing of||||6,136,292|-6,136,2||
|surplus reserves||||.76|92.76||
|2．Allotment to the|||||||
|owners (or|||||||
|shareholders)|||||||
|3．Other|||||||
|(IV)Internal|||||||
|transferring of|||||||
|owners’ equity|||||||
|1. Capitalizing of|||||||
|capital reserves (or|||||||
|to capital shares)|||||||
|2. Capitalizing of|||||||
|surplus reserves|||||||
|(or to capital|||||||
|shares)|||||||
|3．Making up|||||||
|losses by surplus|||||||
|reserves.|||||||
|4. Other|||||||
|(V) Special|||||||
|reserves|||||||
|1. Provided this|||||||
|year|||||||
|2．Used this term|||||||
|（VI）Other|||||||
|IV. Balance at the|506,521,|1,576,547|3,212,187|70,539,31|398,477|2,555,297,528.20|
|end of this term|849.00|,069.58|.35|9.86|,102.41||

 Amount in last year
In RMB
|||
|-|-|
|Items|Amount in last year|

|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
|||Other Equity instrusment||||||||||
||||||||Other|||||
|||||Other||Less:|||||Total of|
||Share||||Capital||Compreh|Specialize|Surplus|Attribut||
|||preferre|Sustain|||Shares in||||able|owners’|
||Capital||||reserves||ensive|d reserve|reserves|||
|||d stock|able|||stock||||profit|equity|
||||||||Income|||||
||||debt|||||||||
||506,521,||||1,574,407||23,534,77||59,801,73|301,838|2,466,104|
|I.Balance at the||||||||||||
||849.00||||,414.34||3.29||5.10|,839.50|,611.23|
|end of last year||||||||||||
|Add: Change of||||||||||||
|accounting||||||||||||
|policy||||||||||||
|Correcting of||||||||||||
|previous errors||||||||||||
|Other||||||||||||
|II.Balance at the||||||||||||
||506,521,||||1,574,407||23,534,77||59,801,73|301,838|2,466,104|
|beginning of||||||||||||
||849.00||||,414.34||3.29||5.10|,839.50|,611.23|
|current year||||||||||||
|III.Changed in the|||||2,139,655||9,854,344||4,601,292|41,411,|58,006,91|
|current year|||||.24||.17||.00|628.02|9.43|
|（1）Total||||||||||||
||||||||9,854,344|||46,012,|55,867,26|
|comprehensive||||||||||||
||||||||.17|||920.02|4.19|
|income||||||||||||
|（II）Investment or||||||||||||
|decreasing of||||||||||||
|capital by owners||||||||||||
|1．Ordinary Share||||||||||||
|s invested by hareh||||||||||||
|olders||||||||||||
|2．Holders of oth||||||||||||
|er equity instrume||||||||||||
|nts invested capital||||||||||||
|3．Allotment to the||||||||||||
|owners (or||||||||||||
|shareholders)||||||||||||
|4．Other||||||||||||
|（III）Profit|||||||||4,601,292|-4,601,2||
|allotment|||||||||.00|92.00||
|1.Providing of|||||||||4,601,292|-4,601,2||
|surplus reserves|||||||||.00|92.00||
|2．Allotment to the||||||||||||
|owners (or||||||||||||

||||||||
|-|-|-|-|-|-|-|
|shareholders)|||||||
|3．Other|||||||
|(IV)Internal|||||||
|transferring of|||||||
|owners’ equity|||||||
|1. Capitalizing of|||||||
|capital reserves (or|||||||
|to capital shares)|||||||
|2. Capitalizing of|||||||
|surplus reserves|||||||
|(or to capital|||||||
|shares)|||||||
|3．Making up|||||||
|losses by surplus|||||||
|reserves.|||||||
|4. Other|||||||
|(V) Special|||||||
|reserves|||||||
|1. Provided this|||||||
|year|||||||
|2．Used this term|||||||
|||2,139,655||||2,139,655|
|（VI）Other|||||||
|||.24||||.24|
|IV. Balance at the|506,521,|1,576,547|33,389,11|64,403,02|343,250|2,524,111|
|end of this term|849.00|,069.58|7.46|7.10|,467.52|,530.66|

 Legal Representative: Zhu Jun Person in charge ofaccounting：Zhu Jun Accounting Dept Leader: Mu Linying
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements Shenzhen Textile (Holdings) Co., Ltd.
Notes to financial statements
Year 2015
(Currency unit for the statements in the notes to these financial statements: RMB)
I. Basic Information of the Company
(1)Company Profile
1. Enterprise registration address, organization mode and headquarter address.
The company was previously the Shenzhen Textile Industry Company, on April 13, 1994, approved
by the Letter(1994)No.15 issued by Shenzhen Municipal People's Government, the Company was
restructured and named as Shenzhen Textile (Holdings) Co., Ltd. In the same year, approved by the
(1994) No.19 file of Shenzhenshi, the shares of the company were listed in Shenzhen Stock
Exchange. The Company has got the corporate business certification of Shensizi No.
440301105031014, Registration address and headquarter address are 6/F,Shenfang Building,
Huaqiang Road. North, Futian District, Shenzhen.
2.Enterprise’s business nature and major business operation.
At present, the Company is mainly engaged in high-tech industry focusing onR&D, production and
marketing ofpolarizer’s for liquid crystal display, management of properties in bustling business
districts of Shenzhen and reserved high-class textile and garment business.
3. Approval of the financial statements reported
The financial statements have been authorized for issuance by the Board of Directors of the Group
on March 29,2016.
(2)Scope of consolidated financial statements
1.As of the end of the reporting period, there are 7 subsidiaries companies included in the
consolidated financial statements:Shenzhen Shengbo Optoelectronic Technology Co., Ltd.,
Shenzhen Lisi Industrial Development Co., Ltd.,Shenzhen Huaqiang Hotel, Shenzhen Shenfang
Property Management Co., Ltd., Shenzhen Beautify Garments Co., Ltd., Shenzhen Shenfang Import
& Export Co., Ltd. and Shengtou (Hongkong) Co.,Ltd.
2．The scope of consolidated financial statements this period did not change.
II.Basis for the preparation of financial statements
（1）Basis for the preparation
The basis of the financial statements was continuous operation assumption, based on actual
transactions, in accordance with the relevant provisions of Accounting Standards for Business
Enterprises and in accordance with this Note III, "Significant accounting policies and accounting
estimates".
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements (2).Continuation
There will be no such events or situations in the 12 months from the end of the reporting period that will cause material doubts as to the continuation capability of the Company.
III. Important accounting policies and estimations
1. Statement on complying with corporate accounting standards
The financial statements prepared by the Company comply with the requirements of corporate
accounting standards. They truly and completely reflect the financial situations, operating results,
equity changes and cash flow, and other relevant information of the company.
2.Fiscal Year
The Company adopts the Gregorian calendar year commencing on January 1 and ending on
December 31 as the fiscal year.
3. Operating cycle
Normal business cycle is realized by the Company in cash or cash equivalents from the purchase of
assets for processing until. Less than 1 year is for the normal operating cycle in the company.
With regard to less than 1 year for the normal operating cycle, the assets realized or the liabilities
repaid at maturity within one year as of the balance sheet date shall be classified into the current
assets or the current liabilities.
4. Accounting standard money
The Company takes RMB as the standard currency for bookkeeping.
5. Accounting process method of enterprise consolidation under same and different
controlling.
（1）Enterprise merger under samecontrol：
For a business combination involving enterprises under common control, the party that, on the
combination date, obtains control of another enterprise participating in the combination is the
absorbing party, while that other enterprise participating in the combination is a party being
absorbed. Combination date is the date on which the absorbing party effectively obtains control of
the party being absorbed.
The assets and liabilities obtained are measured at the carrying amounts as recorded by the
enterprise being combined at the combination date. The difference between the carrying amount of
the net assets obtained and the carrying amount of consideration paid for the combination (or the
total face value of shares issued) is adjusted to the capital premium in the capital reserve. If the
balance of the capital premium is insufficient, any excess is adjusted to retained earnings.
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements The cost of a combination incurred by the absorbing party includes any costs directly attributable to the combination shall be recognized as an expense through profit or loss for the current period when incurred.
Accounting Treatment of the Consolidated Financial Statements:
The long-term equity investment held by the combining party before the combination will change if
the relevant profit and loss, other comprehensive income and other owner equity are confirmed
between the ultimate control date and the combining date for the combining party and the combined
party on the acquirement date, and shall respectively offset the initial retained incomes or the profits
and losses of the current period during the comparative statement.
(2)Business combination involving entities not under common control
A business combination involving enterprises not under common control is a business combination
in which all of the combining enterprises are not ultimately controlled by the same party or parties
both before and after the business combination. For a business combination not involving
enterprises under common control, the party that, on the acquisition date, obtains control of another
enterprise participating in the combination is the acquirer, while that other enterprise participating in
the combination is the acquire. Acquisition date is the date on which the acquirer effectively obtains
control of the acquire.
The difference of the merger cost minus the fair value shares of identifiable net assets obtained by
the acquire during the merger on the acquisition date, is recognized as the business reputation.
While the merger cost is less than the fair value shares of identifiable net assets obtained by the
acquire during the merger, all the measurement on the identifiable assets, the liabilities, the fair
value of liabilities and the merger cost obtained by the acquire should firstly be rechecked, and the
difference shall be recorded into the current profits and costs if the merger cost is still less than the
fair value shares of identifiable net assets obtained by the acquire during the merger after
rechecking.
Where the temporary difference obtained by the acquirer was not recognized due to inconformity
with the conditions applied for recognition of deferred income tax, if, within the 12 months after
acquisition, additional information can prove the existence of related information at acquisition date
and the expected economic benefits on the acquisition date arose from deductible temporary
difference by the acquiree can be achieved, relevant income tax assets can be recognized, and
goodwill offset. If the goodwill is not sufficient, the difference shall be recognized as profit of the
current period.
For a business combination not involving enterprise under common control, which achieved in
stages that involves multiple exchange transactions, according to “The notice of the Ministry of
Finance on the issuance of Accounting Standards Interpretation No. 5” (CaiKuai[2012] No. 19) and
Article51 of “Accounting Standards for Business Enterprises No.33 - Consolidated Financial
Statements” on the “package deal” criterion, to judge the multiple exchange transitions whether they
are the"package deal". If it belong to the “package deal” in reference to the preceding paragraphs of
this section and “long-term investment” accounting treatment, if it does not belong to the “package
deal” to distinguish the individual financial statements and the consolidated financial statements
related to the accounting treatment:
In the individual financial statements, the total value of the book value of theacquirer’s equity
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements investment before the acquisition date and the cost of new investment at the acquisition date, as the
initial cost of the investment, theacquirer’s equity investment before the acquisition date involved
in other comprehensive income, in the disposal of the investment will be in other comprehensive
income associated with the use of infrastructure and the acquire directly related to the disposal of
assets or liabilities of the same accounting treatment (that is, except in accordance with the equity
method of accounting in the defined benefit plan acquire is remeasured net changes in net assets or
liabilities other than in the corresponding share of the lead, and the rest into the current investment
income).
In the combination financial statements, the equity interest in the acquire previously held before the
acquisition date re-assessed at the fair value at the acquisition date, with any difference between its
fair value and its carrying amount is recorded as investment income. The previously-held equity
interest in the acquire involved in other comprehensive income and other comprehensive income
associated with the purchase of the foundation should be used party directly related to the disposal
of assets or liabilities of the same accounting treatment (that is, except in accordance with the equity
method of accounting in the acquire is remeasured defined benefit plans other than changes in net
liabilities or net assets due to a corresponding share of the rest of the acquisition date into current
investment income).
6.Preparation of the consolidated financial statements
(1)The scope of consolidation
The scope of consolidation for the consolidated financial statements is determined on the basis of control. Control is the power to govern the financial and operating policies of an enterprise so as to obtain benefits from its operating activities. The relevant events refer to the activities that have significant influence on the return to the invested party. In accordance with the specific conditions, the relevant events of the invested party should conclude the sale and purchase of goods and services, the management of the financial assets, the purchase and disposal of the assets, the research and development activities, the financing activities and so on.
The scope of consolidation includes the Company and all of the subsidiaries. Subsidiary is an enterprise or entity under the control of the Company.
Once the change in the relevant facts and circumstances leading to the definition of the relevant elements involved in the control of the change, the company will be re-evaluated.
( 2)Preparation of the consolidated financial statements.
The Company based on its own and its subsidiaries financial statements, in accordance with other relevant information, to prepare the consolidated financial statements.
For a subsidiary acquired through a business combination not under common control, the operating results and cash flows from the acquisition (the date when the control is obtained) are included in the consolidated income statement and consolidated statement of cash flows, as appropriated; no adjustment is made to the opening balance and comparative figures in the consolidated financial statements. Where a subsidiary and a party being absorbed in a merger by absorption was acquired during the reporting period, through a business combination involving enterprises under common control, the financial statements of the subsidiary are included in the consolidated financial statements. The results of operations and cash flow are included in the consolidated balance sheet and
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements the consolidated income statement, respectively, based on their carrying amounts, from the date that common control was established, and the opening balances and the comparative figures of the consolidated financial statements are restated.
When the accounting period or accounting policies of a subsidiary are different from those of the Company, the Company makes necessary adjustments to the financial statements of the subsidiary based on theCompany’s own accounting period or accounting policies. Where a subsidiary was acquired during the reporting period through a business combination not under common control, the financial statements was reconciliated on the basis of the fair value of identifiable net assets at the date of acquisition.
Intra-Group balances and transactions, and any unrealized profit or loss arising from intra-Group transactions, are eliminated in preparing the consolidated financial statements.
Minority interest and the portion in the net profit or loss not attributable to the Company are presented separately in the consolidated balance sheet withinshareholders’/owners’ equity and net profit. Net profit or loss attributable to minority shareholders in the subsidiaries is presented separately as minority interest in the consolidated income statement below the net profit line item.
When the amount of loss for the current period attributable to the minority shareholders of a subsidiary exceeds the minorityshareholders’ portion of the opening balance ofshareholders’/equity of the subsidiary, the excess is allocated against the minority interests.
When the Company loses control of a subsidiary due to the disposal of a portion of an equity investment or other reasons, the remaining equity investment is re-measured at its fair value at the date when control is lost. The difference between 1) the total amount of consideration received from the transaction that resulted in the loss of control and the fair value of the remaining equity investment and 2) the carrying amounts of the interest in the formersubsidiary’s net assets immediately before the loss of the control is recognized as investment income for the current period when control is lost. Other comprehensive income related to the former subsidiary's equity investment, using the foundation and the acquire directly related to the disposal of the same assets or liabilities are accounted when the control is lost(ie, in addition to the former subsidiary is remeasured at the net defined benefit plan or changes in net assets and liabilities resulting from, the rest are transferred to the current investment income). The retained interest is subsequently measured according to the rules stipulated in the - “Chinese Accounting Standards for Business Enterprises No.2 - Long-term equity investment” or “Chinese Accounting Standards for Business Enterprises No.22 - Determination and measurement of financial instruments”.
The company through multiple transactions step deal with disposal of the subsidiary's equity investment until the loss of control, need to distinguish between equity until the disposal of a subsidiary's loss of control over whether the transaction is package deal. Terms of the transaction disposition of equity investment in a subsidiary, subject to the following conditions and the economic impact of one or more of cases, usually indicates that several transactions should be accounted for as a packagedeal:①these transactions areconsidered。simultaneously, or in the case of mutual influence made,②these transactions as a whole in order to achieve a complete business results;③the occurrence of a transaction depends on occurs at least one other transaction;④a transaction look alone is not economical, but when considered together with other transaction is economical.
If they does not belong to the package deal, each of them separately, as the case of a transaction in accordance with “without losing control over the disposal of a subsidiary part of a long-term equity
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements investments“principles applicable accounting treatment. Until the disposal of the equity investment loss of control of a subsidiary of the transactions belonging to the package deal, the transaction will be used as a disposal of a subsidiary and the loss of control of the transaction. However, before losing control of the price of each disposal entitled to share in the net assets of the subsidiary 's investment corresponding to the difference between the disposal, recognized in the consolidated financial statements as other comprehensive income, loss of control over the transferred together with the loss of control or loss in the period.
7.Joint venture arrangements classification and Co-operation accounting treatment
(1)Joint arrangement
A joint arrangement is an arrangement of which two or more parties have jointcontrol，depending of the rights and obligation of the Company in the joint arrangement. A joint operation is a joint
arrangement whereby the Company has rights to the assets, and obligations for the liabilities, relating to the arrangement. A joint venture is a joint arrangement whereby the Company has rights to the net assets of the arrangement.
(2)Co-operation accounting treatment
When the joint venture company for joint operations, confirm the following items and share common business interests related to:
（1）Confirm individual assets and common assets held based on shareholdings;
（2）Confirm individual liabilities and shared liabilities held based on shareholdings;
（3）Confirm the income from the sales revenue of co-operate business output
（4）Confirm the income from the sales of the co-operate business output based on shareholdings;
（5）Confirm the individual expenditure and co-operate business cost based on shareholdings.
(3)When a、company is a joint ventures, joint venture investment will be recognized as long-term
equity investments .
8.Recognition Standard of Cash& Cash Equivalents
Cash and cash equivalents of the Company include cash on hand, ready usable deposits and investments having short holding term (normally will be due within three months from the day of purchase), with strong liquidity and easy to be exchanged into certain amount of cash that can be measured reliably and have low risks of change.
9.Foreign Currency Transaction
（1）Foreign Currency Transaction
The approximate shot exchange rate on the transaction date is adopted and translated as RMB
amount when the foreign currency transaction is initially recognized. On the balance sheet date, the
monetary items of foreign currency are translated as per the shot exchange rate on the balance sheet
date, the foreign exchange conversion gap due to the exchange rate, except for the balance of
exchange conversion arising from special foreign currency borrowings capitals and interests for the
purchase and construction of qualified capitalization assets, shall be recorded into the profits and
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements losses of the current period. The non-monetary items of foreign currency measured at the historical
cost shall still be translated at the spot exchange rate on the transaction date, of which the RMB
amount shall not be changed. The non-monetary items of foreign currency measured at the fair
value shall be translated at the spot exchange rate on the fair value recognized date, the gap shall be
recorded into the current profits and losses or other comprehensive incomes.
(2) Translation Method of Foreign Currency Financial Statement
For the assets and liabilities in the balance sheet, the shot exchange rate on the balance sheet date is
adopted as the translation exchange rate. For theowner’s equity, the shot exchange rate on the
transaction date is adopted as the translation exchange rate, with the exception of “undistributed
profits”. The incomes and expenses in the income statement shall be translated at the spot exchange
rate or the approximate exchange rate on the transaction date. The translation gap of financial
statement of foreign currency converted above shall be listed in other comprehensive incomes under
theowner’s equity in the consolidated balance sheet.
10.Financial tools
One financial asset or financial liability shall be recognized when the company becomes the party in the financial instrument contract. The financial assets and the financial liabilities are measured at the fair value in the initial recognition. For the financial assets and liabilities that measured at the fair values and the variation included in the current profits and losses, the relative transaction expenses shall be directly recorded into the profits and losses. For the financial assets and liabilities of other categories, the expenses related to transactions are recognized as initial amount.
1 Determination of financial assets andliabilities’ fair value
Fair value is the amount for which an asset could be exchanged, or a liability settled, between
knowledgeable, willing parties in anarm’s length transaction. For a financial instrument which has an active market, the Company uses quoted price in the active market to establish its fair value. The
quoted price in the active market refers to the price that can be regularly obtained from exchange
market, agencies, industry associations, pricing authorities; it represents the fair market trading price
in the actual transaction. For a financial instrument which does not have an active market, the
Company establishes fair value by using a valuation technique. Valuation techniques include using
recentarm’s length market transactions between knowledgeable, willing parties, reference to the
current fair value of another instrument that is substantially the same, discounted cash flow analysis
and option pricing models.
2. Classification, recognition and measurement of financial assets
All regular way purchases or sales of financial assets are recognized and derecognized on a trade date basis. On initial recognition, theCompany’s financial assets are classified into including financial
assets at fair value though profit or loss, held-to maturity investments, loans and receivables and
available-for-trade assets.
（1） Financial assets at fair value through profit or loss:
Including financial assets held-for-trade and financial assets designated at fair value through profit or loss. Financial asset held-for-trade is the financial asset that meets one of the following conditions:
A. the financial asset is acquired for the purpose of selling it in a short term;
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements B. the financial asset is a part of a portfolio of identifiable financial instruments that are collectively managed, and there is objective evidence indicating that the enterprise recently manages this portfolio for the purpose of short-term profits;
C. the financial asset is a derivative, except for a derivative that is designated and effective hedging instrument, or a financial guarantee contract, or a derivative that is linked to and must be settled by delivery of an unquoted equity instrument (without a quoted price from an active market) whose fair value cannot be reliably measured. For such kind of financial assets, fair values are adopted for subsequent measurement.
Financial asset is designated on initial recognition as at fair value through profit or loss only when it meets one of the following conditions:
A. the designation eliminates or significantly reduces the inconsistency in the measurement or recognition of relevant gains or losses that would otherwise arise from measuring the financial instruments on different bases.
B. a Group of financial instruments is managed and its performance is evaluated on a fair value basis, and is reported to theenterprise’s key management personnels. Formal documentation regarding risk management or investment strategy hasprepared。
Financial assets at fair value through profit or loss are subsequently measured at the fair value. Any gains or losses arising from changes in the fair value and any dividends or interest income earned on the financial assets are recognized in the profit or loss.
（2）Investment held-to maturity
Held-to-maturity investments are non-derivative financial assets with fixed or determinable payments and fixed maturity that an entity has the positive intention and ability to hold to maturity. Such kind of financial assets are subsequently measured at amortized cost using the effective interest method. Gains or losses arising from derecognition, impairment or amortization are recognized in profit or loss for the current period.
Effective interest rate is the rate that exactly discounted estimated future cash flows through the expected life of the financial asset or financial liability or, where appropriate, a shorter period to the net carrying amount of the financial asset or financial liability. When calculating the effective interest rate, the Company shall estimate future cash flow considering all contractual terms of the financial asset or financial liability without considering future credit losses, and also consider all fees paid or received between the parties to the contract giving rise to the financial asset and financial liability that are an integral part of the effective interest rate, transaction costs, and premiums or discounts, etc.
（3）Loans and receivables
Loans and receivables are non-derivative financial assets with fixed determinable payment that are not quoted in an active market. Financial assets classified as loans and receivables by the Company include note receivables, account receivables, interest receivable dividends receivable and other receivables.
Loans and receivables are subsequently measured at amortized cost using the effective interest method. Gain or loss arising from derecognition, impairment or amortization is recognized in profit or loss.
（4）Financial assets available-for-trade
Financial assets available-for-trade include non-derivative financial assets that are designated on initial recognition as available for trade, and financial assets that are not classified as financial assets
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements at fair value through profit or loss, loans and receivables or investment held-to-maturity.
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 comprehensive income and included in the capital reserve, except that impairment losses and exchange differences related to amortized cost of monetary financial assets denominated in foreign currencies are recognized in profit or loss, until the financial assets are derecognized, at which time the gains or losses are released and recognized in profit or loss. Interests obtained and dividends declared by the investee during the period in which the financial assets available-for-trade are held, are recognized in investment gains.
3. Impairment of financial assets
The Group 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 shall make an independent impairment test on the financial assets with significant single amounts, and carry out an independent impairment test on the financial assets with insignificant single amounts, or conduct an impairment-related test after they are included in a combination of financial assets with similar credit risk features so as to carry out. Where, upon independent test, the financial asset (including those financial assets with significant single amounts and those with insignificant amounts) has not been impaired, it shall be included in a combination of financial assets with similar risk features so as to conduct another impairment test. The financial assets which have suffered from an impairment loss in any single amount shall not be included in any combination of financial assets with similar risk features for any 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 loss on available-for-trade financial assets
Where the fair value of the equity instrument investment drops significantly or not contemporarily according to the integrated relevant factors, an available-for-trade financial asset is impaired. The "serious decline" refers to the cumulative fair value declines more than30%; "non-temporary decline" refers to the continuous decline in the fair value of time over 12 months.
When an available-for-trade financial asset is impaired, the cumulative loss arising from declining in fair value that had been recognized in capital reserve shall be removed and recognized in profit or loss. The amount of the cumulative loss that is removed shall be difference between the acquisition cost with deduction of recoverable amount less amortized cost, current fair value and any impairment loss on that financial asset previously recognized in profit or loss.
If, after an impairment loss has been recognized, there is objective evidence that the value of the financial asset is recovered, and it is objectively related to an event occurring after the impairment loss was recognized, the initial impairment loss can be reversed and the reserved impairment loss on available-for-trade equity instrument is recorded in the profit or loss, the reserved impairment loss on available-for-trade debt instrument is recorded in the current profit or loss.
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements The equity instrument where there is no quoted price in an active market, and whose fair value cannot be reliably measured, or impairment loss on a derivative asset that is linked to and must be settled by delivery of such an unquoted equity instrument shall not be reversed.
4. Recognition and measurement of financial assets transfer
The Group derecognizes a financial asset when one of the following conditions is met:
1) the rights to receive cash flows from the asset have expired;
2) the enterprise has transferred its rights to receive cash flows from the asset to a third party under a pass-through arrangement; or
3) the enterprise has transferred its rights to receive cash flows from the asset and either has transferred substantially all the risks and rewards of the asset, or has neither transferred norretained substantially all the risks and rewards of the asset, but has transferred control of the asset.
If the enterprise has neither retained all the risks and rewards from the financial asset nor control over the asset, the asset is recognized according to the extent it exists as financial asset, and correspondent liability is recognized. The extent of existence refers the level of risk by the financial asset changes the enterprise is facing.
For a transfer of a financial asset in its entirety that satisfies the derecognition criteria, the carrying amount of the financial asset transferred; and the sum of the consideration received from the transfer and any cumulative gain or loss that had been recognized in other comprehensive income, is recognized in profit or loss.
If a part of the transferred financial asset qualifies for derecognition, the carrying amount of the transferred financial asset is allocated between the part that continues to be recognized and the part that is derecognized, based on the relative fair value of those parts. The difference between (a) the carrying amount allocated to the part derecognized; and (b) the sum of the consideration received for the part derecognized and any cumulative gain or loss allocated to the part derecognized which has been previously recognized in other comprehensive income, is recognized in profit or loss.
The Company uses recourse sale financial assets, or financial assets held endorser, determine almost all of the risks and rewards of ownership of the financial assets have been transferred if. Has transferred the ownership of the financial assets of almost all the risks and rewards to the transferee, the derecognition of the financial asset; retains ownership of the financial assets of almost all of the risks and rewards of financial assets that are not derecognised; neither transfers nor retains ownership of the financial assets of almost all of the risks and rewards, then continue to determine whether the enterprise retains control of the assets and the accounting treatment in accordance with the principles described in the preceding paragraphs.
5. Classification and measurement of financial liabilities
TheGroup’s financial liabilities are, on initial recognition, classified into financial liabilities at fair value through profit or loss and other financial liabilities. For financial liabilities at fair value through profit or loss, relevant transaction costs are immediately recognized in profit or loss for the current period, and transaction costs relating to other financial liabilities are included in the initial recognition amounts.
(1)Financial liabilities measured by the fair value and the changes recorded in profit or loss
The classification by which financial liabilities held-for-trade and financial liabilities designed at the initial recognition to be measured by the fair value follows the same criteria as the classification by which financial assets held-for-trade and financial assets designed at the initial recognition to be
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements measured by the fair value and their changes are recorded in the current profit or loss.For the financial liabilities measured by the fair value and changes recorded in the profit or loss, fair values are adopted for subsequent measurement. All the gains or losses on the change of fair value and the expenses on dividends or interests related to these financial liabilities are recognized in profit or loss for the current period.
（2）Other financial liabilities
Derivative financial liabilities that linked with equity instruments, which do not have a quoted price in an active market and their fair value cannot be measured reliably, is subsequently measured by cost Other financial liabilities are subsequently measured at amortized cost using the effective interest method. Gains or losses arising from derecognition or amortization is recognized in profit or loss for the current period.
6. Derecognition of financial liabilities
The Group derecognizes a financial liability (or part of it) when the underlying present obligation (or part of it) is discharged or cancelled or has expired. An agreement between the Company (an existing borrower) and existing lender to replace original financial liability with a new financial liability with substantially different terms is accounted for as an extinguishment of the original financial liability and the recognition of a new liability.
When the Company derecognizes a financial liability or a part of it, it recognizes the difference between the carrying amount of the financial liability (or part of the financial liability) derecognized the consideration paid (including any non-cash assets transferred or new financial liabilities assumed) in profit or loss.
7. Offsetting financial assets and financial liabilities
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.
8. Equity instruments
An equity instrument is any contract that evidences a residual interest in the assets of the Company after deducting all of its liabilities. The consideration received from issuing equity instruments, net of transaction costs, are added toshareholders’ equity. All types of distribution (excluding stock dividends) made by the Company to holders of equity instruments are deducted fromshareholders’ equity. The Group does not recognize any changes in the fair value of equity instruments.
11.Accounts Receivable
1.Accounts receivable with material specific amount and specific provisioned bad debt
preparation.
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|-|-|
|Judgment criteria oramount standard ofmaterial specific amount|The Client Identifies single amount of accounts receivable that is not less than RMB 1 million asaccount receivable that are individually significant in amount. The Client Identifies singleamount of accounts receivable that is not less than RMB 0.5 million as account receivable that|

S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
|||
|-|-|
|or amount criteria：|are individually significant in amount.|
|Provision method withmaterial specific amountand provision of specificbad debt preparation：|Making an independent impairment test. If any objective evidence shows that it has beenimpaired, the impairment-related losses shall be recognized according to the gap between itspresent value of future cash flow less than its book value, and the several shall be determined towithdraw the bad debt provision. If there exists no the impairment after the impairment test,they shall be included in a combination of the receivables with similar risk features so as towithdraw the bad debt provision.|

2.The accounts receivable of bad debt provisions made by credit risk Group
(1) Recognition Criteria for the Group and Withdrawing Method of Bad Debt Provision
Name Recognition Criteria Withdrawing Method
Aging Group Division by Aging Aging Analysis Method
(2)Accounts on age basis in theportfolio：
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|-|-|-|
|Aging|||
||Rate for receivables(%)|Rate for other receivables(%)|
||5|5|
|Within 1 year（Included 1 year）|||
||10|10|
|1－2 years|||
||30|30|
|2－3 years|||
||50|50|
|Over 3 years|||

(3)Account receivable with non-material specific amount but specific bad debt preparation
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|-|-|
|Reasons of Withdrawing Individual Bad DebtProvision|There is any objective evidence shows that it has been impaired.|
|Withdrawing Method of Bad Debt Provision|The impairment-related losses shall be recognized according to the gapbetween its present value of future cash flow less than its book value.|

 12.Inventory
1.Investories class
Inventory shall include the finished products or goods available for sale during daily activities, the products in the process of production, the stuff and material consumed during the process of
production or the services offered.
2．Valuation method of inventory issued
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements The company calculates the prices of its inventories according to the weighted averages method
3. Recognition Criteria for the Net Realizable Value of Different Category of Inventory and Withdrawing Method of Inventory Falling Price Reserves
The inventory shall be measured by use of the lower between the cost and the net realizable value and the inventory falling price reserves shall be withdrawn as per the gap of single inventory cost minus the net realizable value at the balance sheet date. The net realizable value refers to the amounts that the estimated sale price of inventory minus the estimated costs ready to happen till the completion of works, the estimated selling expenses and the relevant expenses of taxation. The company shall recognize the net realizable value of inventory based on the acquired unambiguous evidence and in view of the purpose to hold the inventory, the influence of matters after the balance sheet date and other factors.
The net realizable value of inventory directly for sale shall be recognized according to the amounts of the estimated sale price of the inventory minus the estimated sale expenses and the relevant expenses of taxation during the process of normal production and operation. The net realizable value of inventory that required to conduct processing shall be recognized according to the amounts of the estimated sale price of the finished products minus the estimated costs ready to happen till the completion of works, the estimated selling expenses and the relevant expenses of taxation. On the balance sheet date, the net realizable value shall be respectively defined for the partial agreed with the contract price and others without the contract price in the same inventory, and the amounts of the inventory falling price reserves withdrawn or returned shall be respectively recognized in comparison with their corresponding costs.
4. Inventory System: Adopts the Perpetual Inventory System
5．Amortization method for low cost and short-lived consumable items and packaging materials
（1）Low cost and short-lived consumable items
Low cost and short-lived consumable items are amortized using immediate write-offmethod。
（2）Packaging materials
Packaging materials are amortized using
13.Held-for-sale assets
A non-current asset is classified as held-for-sale if all of the following conditions are satisfied:
1The asset is immediately sellable at its current condition per usual sales term applicable to the type of assets to which itbelongs；
2. the Company's has completed official decision to dispose the asset;
3. the Company has entered into irrevocable sales contract with the purchaser; and
4. the sales will be completed within one year.
Is classified as held for sale and the disposal of non current assets in the group of assets and liabilities, are classified as current assets and current liabilities.
Termination of operation to meet one of the following conditions have been disposed of or classified as held for sale, in the operation and the preparation of the financial statements to be able to differentiate the components alone in the company within:
1.This part of main business represents an independent or a main business area;
2.This part of the proposed disposal plans for a major business independent or a main business area;
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements 3 This part is just to sell again and made subsidiary.
For the fixed assets held for sale, the company shall adjust the estimated net residual value of the fixed assets in order to make it reflecting the amount after the disposal costs deducted from the fair value, whichdoesn’t exceed the original book value of the fixed assets when the condition of holding for sale is met. The impairment losses of the assets shall be regarded and recorded into the current profits and losses if the original book value is more than the balance of the estimated net residual value after adjusting.
The assets or the disposal group held for sale no longer meet the recognized requirements of the fixed assets held for sale, the company shall terminate the classification of held-for-sale and measure based on the less one between the following amounts: (1) the amounts after adjusted for the assets or the disposal group classified as the book value before the held-for-sale according to the originally confirmed depreciation, amortization or impairment when supposed that have not classified as the held-for-sale. (2) the returned amounts thatcan’t be re-sold.
The intangible assets and other non-current assets held for sale shall be treated as per above principles.
14.Long-term equity investments
Long-term equity investments referred to in this section refer to the Company invested entity has control, joint control or significant influence over the long-term equity investments. The Company invested does not have control, joint control or significant influence over the long-term equity investments as financial assets available for sale or at fair value and the changes included financial assets through profit or loss.
Joint control is the Company control over an arrangement in accordance with the relevant stipulations are common, related activities and the arrangement must be after sharing control participants agreed to the decision-making. Significant influence is the Company s financial and operating policies of the entity has the right to participate in decision-making, but can not control or with other parties joint control over those policies.
1. Determination of Investment cost
The cost of a long-term equity investment acquired through business combination under common control is measured at the acquirer's share of the combination date book value of the acquiree's net equity in the ultimate controller's consolidated financial statements. The difference between the cost and book value of cash paid, non-monetary assets transferred and liabilities assumed is adjusted to capital reserves, and to retained earnings if capital reserves is insufficient. If the consideration is transferred by way of issuing equity instruments, the face value of the equity instruments issued is recognised in share capital and the difference between the cost of the face value of the equity instruments issued is adjusted to capital reserves, and to retained earnings if capital reserves is insufficient. The cost of a long-term equity investment acquired through business combination not under common control is the fair value of the assets transferred, liabilities incurred or assumed and equity instruments issued. (For the equity of the combined party under common control obtained step-by-step through multiple transactions and the business combination under common control ultimately formed, the company should respectively dispose all the transactions if belong to the package deal. For the package deal, all the transactions will be conducted the accounting treatment as the deal with acquisition of control. For the non-package deal, the shares of the book value of the
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statementsstockholders’equity/owners’ equity of the combined party in the consolidated financial statements of the ultimate control party shall be as the initial investment cost of the long-term equity investment, and the capital reserves shall be adjusted for the difference between the initial investment cost of long-term equity investment and the sum of the book value of long-term equity investment before merging and that of new consideration payment obtained on the merger date, or the retained earnings shall be adjusted if the capital reserves are insufficient to offset. As for the equity investment held before the merger date, the accounting treatment will not be conducted temporarily for other comprehensive income accounted by equity method or confirmed for the financial assets available for sale.)
All expenses incurred directly associated with the acquisition by the acquirer, including expenditure of audit, legal services, valuation and consultancy and other administrative expenses, are recognised in profit or loss for the period during which the acquisition occurs. For the merger of enterprises not under the same control through gaining the shares of the combined enterprise by multiple steps of deals, it shall deal with it in the following two ways depending on that if it belongs to "a package deal": if it belongs to "a package deal", it shall deal with all the deals as one obtaining the control power; if it does not belong to "a package deal", it shall, on the date of merger, regard the sum of book value of theowner’s original equity of the merged enterprise and the newly increased investment cost as the initial cost of the long-term equity investment. For the shares originally held by this enterprise accounted for by weighted equity method, the relevant other comprehensive income shall not be accounted for temporarily. If the equity investment held originally can be classified as the financial assets for sale, the difference between the fair value and the book value, and the variation in the accumulative fair value of other comprehensive returns recorded originally will be transferred into the current profits and losses.
All expenses incurred directly associated with the acquisition by the acquirer, including expenditure of audit, legal services, valuation and consultancy and other administrative expenses, are recognised in profit or loss for the period during which the acquisition occurs.
Long-term equity investments acquired not through business combination are measured at cost on initial recognition. Depending on the way of acquisition, the cost of acquisition can be the total cash paid, the fair value of equity instrument issued, the contract price, the fair value or book value of the assets given away in the case of non-monetary asset exchange, or the fair value of the relevant long-term equity investments. The cost of acquisition of a long-term equity investment acquired not through business combination also includes all directly associated expenses, applicable taxes and fees, and other necessary expenses. When the significant impact or the joint control but non-control on the invested party can be implemented due to the additional investment, the long-term equity investment cost is the sum of the fair value of the equity investment originally held and the new investment costs based on the recognition of “Accounting Standards for Enterprises No.22– Recognition and Measurement of Financial Instruments”.
2. Subsequent Measurement
To be invested joint control ( except constitute common operator ) or long-term equity investments significant influence are accounted for using the equity method. In addition, the Company's financial statements using the cost method of accounting for long-term equity can exercise control over the investee.
(1)Cost method of accounting for long-term equity investments
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements Under the cost method, a long-term equity investment is measured at initial investment cost. Except for cash dividends or profits declared but not yet paid that are included in the price or consideration actually paid upon acquisition of the long-term equity investment, investment income is recognized in the period in accordance with the attributable share of cash dividends or profit distributions declared by the investee.
(2)Equity method of accounting for long-term equity investments
When using the equity method, the initial investment cost of long-term equity investment exceeds th
e investor's net identifiable assets of the fair share of the investment value, do not adjust the initial in
vestment cost of long-term equity investment; the initial investment cost is less than the investee uni
t share of identifiable net assets at fair value, the difference is recognized in profit or loss, while the
long-term equity investment adjustment costs.
Where the initial investment cost of a long-term equity investment exceeds the investingenterprise’s interest in the fair values of theinvestee’s identifiable net assets at the time of acquisition, no adjustment shall be made to the initial investment cost. The carrying amount of an long-term equity investment measured using the equity method is adjusted by the Company's share of the investee's net profit and other comprehensive income, which is recognised as investment income and other comprehensive income respectively. The carrying amount of an long-term equity investment measured using the equity method is reduced by profit distribution or cash dividends announced by the investee. The carrying amount of an long-term equity investment measured using the equity method is also adjusted by the investee's equity movement other than net profit, other comprehensive income and profit distribution, which is adjusted to capitalreserves。The net profit of the investee is adjusted by the fair value of the investee's identifiable assets as at acquistion. The financial statements and hence the net profit and other comprehensive income of an investee which does not adopt accounting policies or accounting period uniform with the Company is adjusted by the Company's accounting policies and accounting period. The Company's share of unrealised profit or loss arising from related party transactions between the Company and an associate or joint venture is deducted from investment income. Unrealised loss arising from related party transactions between the Company and an associate or joint venture which is associated with asset impairment is not adjusted. Where assets transferred to an associate or joint venture which form part of the Company's investment in the investee but which does not enable the Company obtain control over the investee, the cost of the additional investment acquired is measured at the fair value of assets transferred and the difference between the cost of the additional investment and the book value of the assets transferred is recognised in profit or loss. Where assets transferred to an associate or joint venture form an operation, the difference between the consideration received and the book value of the assets transferred in recognised in profit or loss. Where assets transferred from an associate or joint venture form an operation, the transaction is accounted for in accordance with CAS 20 - Business Combination, any gain or loss is reocgnised in profit or loss.
The Company's share of an investee's net loss is limited by the sum of the book value of the long-term equity investment and other net long-term investments in the investees. Where the Company has obligation to share additional net loss of the investee, the estimatedshare of loss recognised as accrued liabilities and investment loss. Where the Company has unrecognised share of loss of the investee when the investee generates net profit, the Company's unrecognised share of loss is reduced by the Company's share of net profit and when the Company's unrecognised share or loss is eliminated in full, the Company's share of net profit, if any, is recognised as investment income.
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements (3)Acquisition of minority interest
The difference between newly increased equity investment due to acquisition of minority interests and portion of net asset cumulatively calculated from the acquisition date is adjusted as capital reserve. If the capital reserve is not sufficient to absorb the difference, the excess are adjusted against returned earnings.
(4)Disposal of long-term equity investment
Where the parent company disposes long-term investment in a subsidiary without a change in control, the difference in the net asset between the amount of disposed long-term investment and the amount of the consideration paid or received is adjusted to theowner’s equity. If the disposal of long-term investment in a subsidiary involves loss of control over the subsidiary, the related accounting policies in Note applies. For disposal of long-term equity investments in any situation other than the fore-mentioned situation, the difference between the book value of the investment disposed and the consideration received is recognised in profit or loss.
The investee's equity movement other than net profit, other comprehensive income and profit distribution is reocgnised in profit or loss proportionate to the disposal.
Where a long-term equity investment is measured by the equity method both before and after part disposal of the investment, cumulative other comprehensive income relevant to the investment recognised prior to the acquistion is treated in the same manner that the investee disposes the relevant assets or liabilities proportionate to the disposal. The investee's equity movement other than net profit, other comprehensive income and profit distribution is reocgnised in profit or loss proportionate to the disposal.
Where a long-term equity investment is measured at cost both before and after part disposal of the investment, cumulative other comprehensive income relevant to the investment recognised, as a result of accounting by equity method or recognition and measurement principles applicable to financial instruments, prior to the Company's acquisition of control over the investee is treated in the same manner that the investee disposes the relevant assets or liabilities and recognised in profit or loss proportionate to the disposal. The investee's equity movement other than net profit, other comprehensive income and profit distribution, as a result of accounting by equity method, is reocgnised in profit or loss proportionate to the disposal.
Where the Company's control over an investee is lost due to partial disposal of investment in the investee and the Company continues to have significant influence over the investee after the partial disposal, the investment in measured by the equity method in the Company's separate financial statements; where the Company's control over an investee is lost due to partial disposal of investment in the investee and the Company ceases to have significant influence over the investee after the partial disposal, the investment in measured in accordance with the recognition and measurement principles applicable to financial instruments in the Company's separate financialstatements and the difference between the fair value and the book value of the remaining investment at the date of loss of control is recognised in profit or loss. Cumulative other comprehensive income relevant to the investment recognised, as a result of accounting by equity method or recognition and measurement principles applicable to financial instruments, prior to the Company's acquisition of control over the investee is treated in the same manner that the investee disposes the relevant assets or liabilities on the date of loss of control. The investee's equity movement other than net profit, other comprehensive income and profit distribution, as a result of accounting by equity method, is reocgnised in profit or
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements loss when control is lost. Where the remaining investment is measured by equity method, the fore-mentioned other comprehensive income and other equity movement are recognised in profit or loss proportionate to the disposal; Where the remaining investment is measured in accordance with the recognition and measurement principles applicable to financial instruments, the fore-mentioned other comprehensive income and other equity movement are recognised in profit or loss in full.
Where the Company's joint control or significant influence over an investee is lost due to partial disposal of investment in the investee,the remaining investment in the investee is measured in accordance with the recognition and measurement principles applicable to financial instruments, the difference between the fair value and the book value of the remaining investment at the date of loss of joint control or significant influence is recognised in profit or loss.Cumulative other comprehensive income relevant to the investment recognised, as a result of accounting by equity method, prior to the partial disposal is treated in the same manner that the investee disposes the relevant assets or liabilities on the date of loss of joint control or significant influence. The investee's equity movement other than net profit, other comprehensive income and profit distribution is reocgnised in profit or loss when joint control or significant influence is lost.
Where the Company's control over an investee is lost through multiple disposals and the multiple disposals shall be viewed as one single transaction, the multiple disposals is accounted for one single transaction which result in the Company's loss of control over the investee. Each difference between the consideration received and the book value of the investment disposed is recognised in other comprehensive income and reclassified in full to profit or loss at the time when control over the investee is lost.
15.Investment property
1. The Measurement Mode of Investment Property
The investment property of the company includes the leased land use rights, the leased buildings,
the land use rights held and prepared to transfer after appreciation.
The company shall adopt the cost mode to measure the investment property.
2. Depreciation or Amortization Method by Use of Cost Mode
The leased buildings of the investment property in the company shall be withdrawn the depreciation
by the service life average method, and the depreciation policy is the same with that of the fixed
assets. The land use rights held and prepared to transfer after appreciation in the investment property
shall be amortized by the line method, and the specific accounting policy is same with that of the
intangible assets.
16.Fixed assets
1．The conditions of recognition
Fixed assets refers to the tangible assets that are held for the sake of producing commodities,
rendering labor service, renting or business management and their useful life is in excess of one
fiscal year. The fixed assets can be recognized when the following requirements are all met: (1) the
economic benefits relevant to the fixed assets will flow into the enterprise. (2) the cost of the fixed
assets can be measured reliably.
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements The fixed assets of the company include the houses and buildings, the decoration of the fixed assets,
the machinery equipment, the transportation equipment, the electronic instrument and other devices.
2. Initial Measurement and Subsequent Measurement of the Fixed Assets
The fixed assets shall be book kept as per the acquired actual cost, and the depreciation shall be
withdrawn from the subsequent month after the usable status reserved and achieved.
3．The method for depreciation
||||||
|-|-|-|-|-|
||The method for|Expected useful life|||
|Category|||Estimated residual value|Depreciation|
||depreciation|（Year）|||
|House and Building-|Straight-line method||||
|||35 years|4%|2.74%|
|Production|||||
|House and|Straight-line method||||
|Building-Non-||40 years|4%|2.40%|
|Production|||||
|Decoration of Fixed|Straight-line method||||
|||10 years||10.00%|
|assets|||||
|Machinery and|Straight-line method||||
|||10-14 years|4%|9.60%-6.86%|
|equipment|||||
|Transportation|Straight-line method||||
|||8 years|4%|12.00%|
|equipment|||||
||Straight-line method||||
|Electronic equipment||8 years|4%|12.00%|
|Other equipment|Straight-line method|8 years|4%|12.00%|

4．Cognizance evidence and pricing method of financial leasing fixed assets
(1) Recognition Criteria of the Fixed Assets under Financing Lease
The financing lease shall be recognized if the following one or several criteria are met:① the
ownership of the leasing assets shall be transferred to the tenant when the expiration of lease term.
② the tenant has the option to purchase the leasing assets, and the made purchase price is expected
to be far less than the fair value of the leasing assets in the implementation of the option. Thus, it
can be reasonably recognized that the tenant will implement the option on the lease date.③ the
ownership of assets is not transferred, but the lease term shall be the most of the life of the lease
assets.④ the least present value of the lease payment of the tenant and the least present value of the
lease receipts on the lease date almost equal to the fair value of the leasing assets on the lease date
respectively.⑤ the leasing assets have the special nature, and only the tenant can use if there is no
major modifications.
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements (2) Valuation of Fixed Assets Acquired under Finance Leases: the fixed assets acquired under
finance leases shall be book kept according to the lower between the fair value of the leasing assets
and the least lease payment on the lease date.
(3) Depreciation Method of Fixed Assets Acquired under Finance Leases: the depreciation shall be
withdrawn for the fixed assets acquired under finance leases as per the depreciation policy of own
fixed assets.
17.Construction in progress
1. The projects under construction shall be recognized when the economic benefits may flow into and the cost can be reliably measured. Meanwhile, the projects under construction shall be measured according to the actual cost occurred before the assets are built to achieve the expected usable condition.
2. The projects under construction shall be transferred into the fixed assets according to the actual project costs when the expected usable condition achieved. For the expected usable condition achieved while the final accounts for completed projects not handled yet, the projects shall be transferred into the fixed assets as per the estimated value. After the final accounts for completed projects handled, the original estimated value shall be adjusted as per the actual cost, but the original withdrawn depreciation shall not be adjusted again.
18.Borrowing costs
1. Recognition principles for capitalizing of loan expenses
Borrowing expenses occurred to the Company that can be accounted as purchasing or production of
asset satisfying the conditions of capitalizing, are capitalized and accounted as cost of related asset.
Other borrowing expenses are recognized as expenses according to the occurred amount, and
accounted into gain/loss of current term.
2. Duration of capitalization of Loan costs
(1).When a loan expense satisfies all of the following conditions, it is capitalized:
1. Expenditures on assets have taken place.
2. Loan costs have taken place;
3. The construction or production activities to make assets to reach the intended use or sale of state have begun.
（2）Capitalization of borrowing costs is suspended during periods in which the acquisition, construction or production of a qualifying asset is interrupted by activities other than those necessary to prepare the asset for its intended use or sale, when the interruption is for a continuous period of more than 3 months. Borrowing costs incurred during these periods recognized as an expense for the current period until the acquisition, construction or production is resumed.
（3）When the construction or production meets the intended use or sale of state of capitalization conditions, the Loan costs should stop capitalization.
3. Computation Method for Capitalization Rate and Amount of Borrowing Costs
With regard to the special borrowings for the purchase and construction of qualified assets, the
capitalized interest amount shall be recognized according to the amount of the interest cost for the
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements special borrowings actually occurred during the current period (including the amortization of discount or premium recognized as per the effective interest method) minus the interest income acquired after the borrowings deposit in bank or the investment income obtained from the temporary investment. For the general borrowings for the purchase and construction of qualified assets, the capitalized interest amount of the general borrowings shall be computed and recognized according to the weighted average of accumulative asset expense beyond the expense of the special borrowings, multiplying the capitalization rate of general borrowings.
19.Intangible assets
1. Valuation Method, Service Life and Impairment Test of Intangible Assets
(1) The intangible assets include the land use rights, the professional technology and the software, which are conducted the initial measurement as per the cost.
(2) The service life of intangible assets is analyzed and judged when of the company acquires the intangible assets. For the finite service life of the intangible assets, the years of service life or the quantity of service life formed and the number of similar measurement unit shall be estimated. If the term of economic benefits of the intangible assets brought for the company is not able to be foreseen, the intangible assets shall be recognized as that with the indefinite service life.
(3) Estimation Method of Service life of Intangible Assets
1) For the intangible assets with the finite service life, the company shall generally consider the following factors to estimate the service life:① the normal service life of products produced with the assets, and the acquired information of the service life of similar assets.② the estimation of the current stage conditions and the future development trends in the aspects of technology and craft.③ the demand of the products produced by the assets or the offered services in the market.④ the expectation of actions adopted by current or potential competitors.⑤ the expected maintenance expense for sustaining the capacity to economic benefits brought by the assets and the ability to the relevant expense expected.⑥ the relevant law provision or the similar limit to the control term of the assets, such as the licensed use term and the lease term.⑦ the correlation with the service life of other assets held by the company.
2) Intangible Assets with Indefinite Service Life, Judgment Criteria on Indefinite Service Life and Review Procedure of Its Service Life
The company shall be unable to foresee the term of economic benefits brought by the assets for the company, or the indefinite term of intangible assets recognized as the indefinite service life of intangible assets.
The judgment criteria of Indefinite service life:① as from the contractual rights or other legal rights, but the indefinite service life of contract provision or legal provisions.② unable to judge the term of economic benefits brought by the intangible assets for the company after the integration of information in the same industry or the relevant expert argumentation.
At the end of every year, the review should be made for the service life of the intangible assets with the indefinite service life, and the relevant department that uses the intangible assets, shall conduct the basic review by the method from up to down, in order to evaluate the judgment criteria of the indefinite service life if there is the change.
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements (4) Amortization Method of Intangible Assets Value
The intangible assets with the finite service life shall be systematically and reasonably amortized according to the expected implementation mode of the economic benefits related to the intangible assets during the service life, and the line method shall be adopted to amortize for the intangible assets unable to reliably recognize the expected implementation mode. The specific service life is as follows:
|||
|-|-|
|Items|Amortization life time（Year）|
|Land use right|50 years|
|Proprietary technology|15 years|
|Software|5 years|

The intangible assets with the indefinite service life shall not be amortized, and the company shall make the review of the service life of the intangible assets during every accounting period.
(5) If there is the impairment for the intangible assets with the definite service life on the balance sheet date, the corresponding impairment provision shall be withdrawn according to the difference between the book value and the recoverable amount. The intangible assets with the indefinite service life and without the usable condition shall be conducted the impairment test every year whether the impairment exists.
2. Accounting Policy of Internal Research and Development Expenditure
The expenditure for internal research and development project in the study stage shall be recorded
into the current profits and losses when occurring. The expenditure for internal research and
development project in the development stage shall be recognized as the intangible assets when the
following requirements are simultaneously met: (1) the completion of the intangible assets is
available for use or sale, and feasible in the technology. (2) the intention to complete the intangible
assets and use or sale. (3) the method for the economic benefits produced by the intangible assets,
including the evidence that shows there exists the market for the products generated from the
intangible assets or the intangible assets have the market. The intangible assets are used internally
which shows the serviceability. (4) there are sufficient technology, financial resources and other
resources to support the completion of the development of the intangible assets, and there is ability
to use or sell the intangible assets. (5) the expenditure belong to the development stage of the
intangible assets can be reliably measured.
The specific criteria for the division of the internal research and development projects at the
research stage and the development stage of the company is as follows: (1) the investigation stage
planned to obtain the new technology and knowledge, shall be recognized as the research stage,
which has the features of planning and exploration. (2) before the commercial manufacture and use,
the research results or other knowledge should be applied for the plan or design, in order to produce
the new or improved stages with substantial materials, devices and products, which should be
recognized as the development stage, and this stage has the features of pertinence and more
possibility to create the achievement.
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements 20.Long-term Assets Impairment
The company shall make judgment of the long-term assets including the long-term equity
investment, the investment property measured by the cost mode, the fixed assets and the projects
under construction if there is possible impairment on the balance sheet date. If there exists the
evidence shows that the long-term assets have the impairment, the impairment test should be
conducted, and the recoverable amount should be estimated. The impairment shall be confirmed if
there exists after the comparison of the estimated recoverable amount of the assets and its book
value, and if the assets impairment provision shall be withdrawn to recognize the corresponding
impairment losses. The estimation of the recoverable amount of assets should be confirmed
according to the higher one between the net amount of the fair value minus the disposal costs and
the present value of the cash flow of assets expected in the future.
The company shall conduct the impairment test at least every year for the goodwill established by
the business combination and the intangible assets with the indefinite service life whether there
exists the impairment.
The impairment loss of long-term assets after recognizedshouldn’t be reversed in the future accounting period.
21.Long-term amortizable expenses
Deferred charges represent expenses incurred that should be borne and amortized over the current and subsequent period (together of more than one year).
The long-term unamortized expense shall be book kept as per the actual amount occurred, and shall be averagely amortize within the benefit period or the specified period. If the long-term unamortized expensecan’t make the benefits for the future accounting period, the amortized value of the unamortized project shall all be transferred into the current profits and losses.
22.Remuneration
The employee benefits of the company include short-term employee benefits, post-employment
benefits, termination benefits and other long-term employee benefits.
1. Accounting Treatment Method of Short-term Compensation
During the accounting period of service provision of staff, the company shall regard the actual short-term compensation as the liability and record into the current profits and losses or the relevant assets cost as per the beneficiary. Of which, the non-monetary welfare shall be measured as per the fair value.
2. Accounting Treatment Method of Severance Benefit Plans
The severance benefit plans can be divided into the defined contribution plan and the defined benefit plan according to the risk and obligation borne.
(1) The Defined Contribution Plan
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements The contribution deposits that paid to the individual subject for the services provided by the staffs on the balance sheet date during the accounting period, shall be recognized as the liability, and recorded into the current profits and losses or the relevant asset costs as per the beneficiary.
(2) The Defined Benefit Plan
The defined benefit plan is the severance benefit plans with the exception of the defined contribution plans.
1) Based on the expected cumulative welfare unit method, the company shall adopt unbiased and mutually consistent actuarial assumptions to make evaluation of demographic variables and financial variables, measure and define the obligations arising from the benefit plan, and determine the period of the relevant obligations. The company shall discount all the defined benefit plan obligations, including the obligation within twelve months after the end of the annual report during the expected services provision of employee. The discount rate adopted in discounting shall be recognized according to the bonds matched with the defined benefit plan obligation term and the currency at the balance sheet date or the market return of high-quality corporate bonds in the active market.
2) If there exist the assets for the defined benefit plan, the deficit or surplus arising from the present value of the defined benefit plan obligations minus the fair value of the defined benefit plan assets are recognized as the net liability or the net assets of the defined benefit plan. If there exists the surplus of the defined benefit plan, the lower one between the surplus of the define benefit plan and the upper limit of assets shall be used to measure the net assets of the defined benefit plan. The upper limit of assets refers to the present value of economic benefits obtained from the refund of the defined benefit plans or the reduction of deposit funds of future defined benefit plans.
3) At the end of period, theemployee’s payroll costs arising from the defined benefit plan are recognized as the service costs, the net interests on the net liabilities or the net assets of the defined benefit plan, and the changes caused by the net liabilities and the net assets of the defined benefit plan that re-measured. Of which, the service costs and the net interests on the net liabilities or the net assets of the defined benefit plan shall be recorded into the current profits and losses or the relevant assets costs, the changes caused by the net liabilities and the net assets of the defined benefit plan that re-measured shall be recorded into other comprehensive incomes, which should not be switched back to the profits and losses during the subsequent accounting period, but the amount recognized from other comprehensive incomes can be transferred within the scope of the rights and interests.
4) The profit or loss of one settlement shall be recognized when settling the defined benefit plan.
3. Accounting Treatment Method of Demission Welfare
The employee compensation liabilities generated by the demission welfare shall be recognized on the early date and recorded into the current profits and losses: (1) when the companycan’t withdraw the demission welfare provided due to the rundown suggestion or the termination of labor relations plans. (2) when the company recognizes the costs or the expenses related to the reorganization of demission welfare payment.
The earlier one between when the companycan’t withdraw the rundown suggestion or the termination of labor relations plans at its side and when the costs relevant to the recombination of dismission welfare payment, shall be recognized as the liabilities arising from the compensation due to the termination of labor relations with staff and shall be recorded into the current profits and losses.
Then company shall reasonably predict and recognize the payroll payable arising from the dismission
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements welfare. The dismission welfare, which is expected to finish the payment within twelve months after the end of the annual report recognized, shall apply to the relevant provisions of short-term compensation. The dismission welfare, which is expected to be unfinished for the payment within twelve months after the end of the annual report recognized, shall apply to the relevant provisions of short-term compensation, shall apply to the provisions related to other long-term employee benefits.
4. Accounting Treatment Method of Other Long-term Employee Benefits
If other long-term employee benefits of employees provided by the company meet the conditions of the defined contribution plan, the accounting treatment shall be made in accordance with the defined contribution plan. Except for these, other long-term benefits shall be made the accounting treatment according to the defined benefit plan, but the changes arising from the re-measurement of net liabilities or net assets of other long-term employee benefits shall be recorded into the current profits and losses or the relevant assets costs.
23. Estimated Liabilities
1. Recognition Criteria of Estimated Liabilities
The liabilities shall be recognized when external guarantee, pending litigation or arbitration, product
quality assurance, staff reduction plan, loss contract, recombination obligation, disposal obligation of the fixed assets and other pertinent businesses all meet the following requirements:
(1) The obligation is the current obligation borne by the company.
(2) The implementation of the obligation may cause the economic benefits out of the enterprise.
(3) The amount of the obligation can be measured reliably.
2. Measurement Method of Estimated Liabilities
The estimated liabilities shall be made the initial measurement according to the best estimate of the expenditure required to settle the present obligation. There is the continuous scope for the required expenditure, and the best estimate with the same possibilities resulted from various outcomes within the scope shall be recognized as per the intermediate value. The best estimate should be recognize according to the following methods:
(1) The best estimate shall be recognized as per the most possible amount if there are matters involved in the single item.
(2) The best estimate shall be calculated and recognized as per the possible amount if there are matters involved in the multiple item.
If the company pays all the expenses for paying off the estimated liabilities, or partial estimates are compensated by the third party or other parties, the compensation amount should be separately recognized as the assets when the receipt of the compensation amount is basically determined. Meanwhile, the determined compensation amount shall not exceed the book value of the estimated liabilities recognized.
The company shall make review of the book value of estimated liabilities at the balance sheet date. If there is conclusive evidence that the book value cannot really reflect the current best estimate, the adjustment shall be made for the book value in accordance with the current best estimate.
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements 24. Revenue
1. Recognition Principle of Revenue
(1) The Goods for Sale
The revenue of the goods for sale shall be recognized when the following requirements are met simultaneously: the transfer of main risks and rewards on ownership of the goods to the buyers, the continual management rights related to ownership no longer retained by the company and the effective control of the sold goods no longer implemented, the reliable measurement of the revenue amount, the possible inflow of the relevant economic benefits, and the reliable measurement of the relevant costs incurred or to be incurred.
(2) The Service Provision
If the provided services transaction results can be reliably estimated at the balance sheet date (the reliable measurement of the revenue amount, the possible inflow of the relevant economic benefits, the reliable recognition of the completion schedule of transaction, and the reliable measurement of the relevant costs incurred or to be incurred in the transaction), the company shall recognize the relevant service incomes according to the completion percentage method and recognized the completion schedule of the provided service transaction according to the proportion of the costs occurred accounting for the total estimated costs. If the provided services transaction results cannot be reliably estimated at the balance sheet date and the occurred service costs can be expected to have compensation, the company shall recognize to provide the service revenue according to the occurred service cost amount and transfer the service costs as per the same amount. If the occurred service costs cannot be expected to have compensation, the occurred service costs shall be recorded into the current profits and losses and not be recognized as the service revenue.
(3) The Abalienation of the Right to Use Assets
The revenue of abalienation of the right to use assets shall be recognized when the abalienation of the right to use assets meets the requirements of the possible inflow of the relevant economic benefits and the reliable measurement of revenue amount. The interest income shall be calculated and determined according to time and actual interest rate of the monetary capital of the company used by others, and the royalty revenue shall be measured and determined in accordance with the charging time and method appointed in the relevant contract or agree.
2. The Specific Recognition Method of Revenue
The company mainly sells the polaroid, textiles and other products. The revenue of the sale of products in domestic market shall be recognized after the following requirements are met: The company has agreed to deliver the goods to the purchaser under the contract and the revenue amount of product sales has been determined, the payment for goods has been withdrawn or the payment vouchers has been obtained and related economic benefits are likely to inflow, and the costs related to the products can be measured reliably. The revenue of the sale of products in foreign market shall be recognized after the following requirements are met: The company has made customs clearance and departure from port under the contract, the bill of landing has obtained and the revenue of the sale of products has been recognized, the payment for goods has been withdrawn or the payment vouchers has been obtained and related economic benefits are likely to inflow, and the costs related to the products can be measured reliably.
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements 25.Government subsidy
1. Judgment Basis and Accounting Treatment Method of Government Grants related to Assets
The government grants of long-term assets that obtained, used for construction or formed by other ways, shall be recognized as the government subsidy related to the assets. The government grants related to assets are recognized as the deferred income, equally distributed within the service life of the relevant assets, and recorded into the current profits or losses.
2. Judgment Basis and Accounting Treatment Method of Government subsidy related to Income
The government subsidy other than that related to income acquired by the company shall be recognized as the government subsidy related to income.
If the grant objects are not explicitly stipulated in the government files, the government subsidy shall be divided into that related to assets and that related to income, and the judgment basis is that:① if the specific purpose of subsidy is stipulated in the government document, the review and necessary change shall be made at the balance sheet date for the proportion of division according to the relative proportion of assets expense amount and expense amount recorded in the budget of the special item.② only general expression is made in the government documents, and the government subsidy related to income should be made for the non-particular items.
The government subsidy related to income that used for the compensation of the related expenses or losses in subsequent period, shall be recognized as the deferred income and recorded into the current profits and losses during the period of the confirmation of relevant expenses. The relevant expenses or losses occurred for the purpose of compensation shall be directly recorded into the current profits and losses.
3. Recognition Time of Government subsidy
If there is evidence shows that the company can meet the financial support policies and regulations at the end of period, and the support funds can be expected to receive, the government grants shall be recognized as per the receivable amount. In addition, the government subsidy should be recognized when actually received.
4. Accounting Method of Government subsidy
The government subsidy shall be measured as per the received or receivable amount if the grants are as the monetary assets. The government subsidy shall be measured as per the fair value if the grants are as the non-monetary assets, and shall be measured as per the nominal amount if the fair value cannot be reliably obtained.
26.The Deferred Tax Assets / The deferred Tax Liabilities
1. Temporary Difference
The temporary difference includes the difference of the book value of assets and liabilities and the tax basis, and the difference of the book value and the tax basis that no confirmation of assets and liabilities but able to confirm the tax basis as per the provisions of tax law. The temporary difference can be classified into the taxable temporary difference and the deductible temporary difference.
2. Recognition Basis of Deferred Tax Assets
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements For the deductible temporary difference, the deductible loss and the tax payment offset, the company shall recognize the deferred tax assets arising from the future taxable income that obtained to deduce the deductible temporary difference, the deductible loss and the tax payment offset.
The deferred tax assets with the following features and arising from the initial recognition of assets or liabilities in the transaction shall not be recognized: (1) the transaction is not the business combination. (2) the transactiondoesn’t influence the accounting profits and the taxable incomes (or the deductible losses).
The company shall recognize the corresponding deferred tax assets for the deductible temporary difference related to the investment of subsidiaries, cooperative enterprises and joint ventures if the following requirements are simultaneously met: (1) the temporary difference is possible to be reversed in the foreseeable future. (2) the taxable income used to offset the deductible temporary difference is possible to be obtained in the future.
3. Recognition Basis of Deferred Tax Liabilities
All the taxable temporary differences shall be recognized as the deferred tax liabilities.
But the company shall not recognize the taxable temporary differences arising from the following transactions as the deferred tax liabilities: (1) the initial recognition of goodwill. (2) the initial recognition of assets or liabilities arising from the transactions with the following features: this transaction is not the business combination, and the transactiondoesn’t influence the accounting profits and the taxable incomes (or the deductible losses).
The company shall recognize the corresponding deferred tax liabilities for the taxable temporary difference related to the investment of subsidiaries, cooperative enterprises and joint ventures. Except that the following requirements are simultaneously met: (1) the investment enterprise can control the reversal time of the temporary difference. (2) the temporary difference is possible to not be reversed in the foreseeable future.
4. Impairment of Deferred Tax Assets
The company shall review the book value of the deferred tax assets at the balance sheet date. If it is not possible to obtain sufficient taxable income for the reduction of the benefit of the deferred tax assets in the future, the book value of the deferred tax assets shall be deduced. Except that the deferred tax assets and the reduction amount are recorded into theowner’s equity when the original recognition, others shall be recorded into the current income tax expense. The book value of the deferred tax assets reduced can be recovered when sufficient taxable income is possibly obtained.
5. Income Tax Expense
The income tax expense should include the current income tax and the deferred income tax.
Other comprehensive income or the current income tax and the deferred income tax related to the transactions and items directly recorded into thestockholders’ equity, shall be recorded into other comprehensive incomes or thestockholders’ equity, and the book value of goodwill shall be adjusted by the deferred income tax arising from the business combination, but the rest of the current income tax and the deferred income tax expense or income shall be recorded into the current profits and losses.
27.Lease
1. Accounting Treatment Method of Operating Lease
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements When the company is as the tenant, the rental within the lease term shall be recorded into the relevant assets cost or recognized as the current profits and losses as per the line method, and the initial direct expense occurred shall be directly recorded into the current profit and loss. The contingent rental shall be recorded into the current profit and loss once the actual occurrence.
When the company is as the leaser, the rental within the lease term shall be recognized as the current profits and losses as per the line method, and the initial direct expense occurred shall be directly recorded into the current profit and loss, except that the large amounts are capitalized and recorded into the profit and loss by stages. The contingent rental shall be recorded into the current profit and loss once the actual occurrence.
2. Accounting Treatment Method of Finance Lease
When the company is as the tenant, the company shall recognize the less one between the fair value of leasing assets and the present value of minimum lease payment at the lease commencement date as the book value of rented assets, recognize the minimum lease payment as the book value of the long-term payables, and the undeterminedfiancé expense of the difference and the initial direct costs occurred shall be recorded into the leasing asset value. During each lease period, the current financing charges shall be measured and recognized by the effective interest method.
When the company is as the leaser, the company shall recognize the sum of minimum lease receivables and initial direct expense at the lease commencement date as the book value of finance lease receivables, and record the unguaranteed residual value. Meanwhile, the company shall recognize the difference between the sums of minimum lease receivables, minimum lease receivables and unguaranteed minus the sum of the present value as the unrealized financing income. During each lease period, the current financing charges shall be measured and recognized by the effective interest method.
28.Change of main accounting policies and estimations
(1)Change of main accounting policies
□Applicable√Not applicable
N/A
（2）Change of main accounting estimations
□Applicable√Not applicable
N/A
IV.Taxes of the Company
1. Main taxes categories and tax rate
||||
|-|-|-|
|Taxes|Tax references|Applicable tax rates|
||Selling goods or providing taxable||
|VAT||17%|
||labor services||
|Business tax.|Taxable income|5%|

S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
||||
|-|-|-|
|City construction tax|The taxable turnover|7%|
|Business income tax|Taxable income|25%、15%|
|Business income tax|Taxable income|25%、15%|

2. Tax preference and approval file
(1)Shenzhen Shengbo Optoelectronic Technology Co., Ltd., the subsidiary company of our company, has been qualified as national high-tech enterprise since 2013 ,High-tech and enterprise certificate
No.: GF201344200044 ,The certificate is valid for three years, The enterprise income tax rate of this
year is15%.
(2).In accordance with relevant provisions of the Notice of Ministry of Finance, General Administra
tion of Customs and State Taxation Administration Regarding Tax Preference Policies for Further Su
pporting the Development of New-type Display Device Industry (Cai Guan Shui (2012) No. 16), an
d the Notice of Printing and Issuing the Scope of Imported Materials of Enterprises Manufacturing
Colorful Light Filtering Coating and Polarizer Sheets and the List of the First Group of Enterprises
Enjoying Preferential Policies (Cai Guan Shui (2012) No. 53), Shenzhen Shengbo Optoelectronic Te
chnology Co., Ltd. manufactured key materials and parts for the upstream industry of new-type disp
lay devices including colorful light filter coating and polarizer sheet that comply with the planning f
or independent development of domestic industries may enjoy the preferential policies of exemption
from import tariff for the import of raw materials and consumables for the purpose of self use and p
roduction that can not be produced domestically from June 1, 2012 and December 31, 2015. For the
concrete regulations on tax exemption, the Provisional Regulations on Taxation Policies for Importe
d Materials of Enterprises Manufacturing New-type Display Device Panels (Cai Guan Shui (2012)
No. 16).
V. Notes of consolidated financial statement
Unless otherwise stated, the meaning of "B/f", "C/f", "Current year", "Prior year" in the following
notes (incl. Notes to elements of the separate financial statements) is "1st January 2015", "31st
December 2015", "the year ended 31st December 2015", and "the year ended 31st December 2014"
respectively.
1.Monetary Capital
In RMB
||||
|-|-|-|
|Items|Year-end balance|Year-beginning balance|
|Cash at hand|8,872.71|8,588.42|
|Bank deposit|750,353,139.33|1,101,274,000.66|
|Other monetary funds|1,952,859.49|488,972.20|

S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
||||
|-|-|-|
|Total|752,314,871.53|1,101,771,561.28|
|Including : The total amount of deposit|31,258,353.11|3,552,067.53|
|abroad|||

Notes :As of December 31,2016，The fixed-term deposit balance of money fund is RMB
3,655,995.93 , this part will not be treated as closing cash or closing cash equivalent in preparing cash
flow statement. Monetary unit is RMB yuan
2.Bill receivables
1. Classification Bill receivable
In RMB
||||
|-|-|-|
|Items|Year-end balance|Year-beginning balance|
|Bank acceptance|18,841,745.16|43,412,635.19|
|Trade acceptance|||
|Total|18,841,745.16|43,412,635.19|

 2. As of December 31,2015，The company has no Bill receivable pledged.
3．Notes endorsement or discount and undue on balance sheet date
In RMB
||||
|-|-|-|
|Items|Amount derecognizing at period –end|Amount derecognizing at period-end|
|Bank acceptance|32,454,052.03||
|Trade acceptance|||
|Total|32,454,052.03||

4．Bill transferred to account receivable for the issuer is not able to execute the liability at the end of
period.
3. Account receivable
1.Classification account receivables.
Amount in year-end
Book balance Bad debt provision
Classification
Book value
Proportio Proportion(
Amount Amount
n(%) %)
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements Amount in year-end
Book balance Bad debt provision
Classification
Book value
Proportio Proportion(
Amount Amount
n(%) %)
Accounts receivable of
individual significance and
subject to individual
impairment assessment 6,373,036.66 3.16 4,035,782.60 63.33 2,337,254.06 Accounts receivable subject to
impairment assessment by
credit risk characteristics of
a portfolio 189,029,540.68 93.74 9,776,480.20 5.17 179,253,060.48 Accounts receivable of
individual insignificance but
subject to individual
impairment assessment 6,259,765.85 3.10 5,083,708.34 81.21 1,176,057.51 Total 201,662,343.19 100.00 18,895,971.14 182,766,372.05 Amount in year-begin
Book balance Bad debt provision
Classification
Book value
Proportio Proportion(
Amount Amount
n(%) %)
Accounts receivable of
individual significance and
subject to individual
impairment assessment 4,698,879.38 2.73 3,198,621.70 68.07 1,500,257.68 Accounts receivable subject to
impairment assessment by
credit risk characteristics of
a portfolio 162,559,876.54 94.56 8,393,593.26 5.16 154,166,283.28 Accounts receivable of
individual insignificance but
subject to individual
impairment assessment 4,651,945.06 2.71 4,194,915.67 90.18 457,029.39 Total 171,910,700.98 100.00 15,787,130.63 156,123,570.35
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements (1)Accounts receivable of individual significance and subject to individual impairment assessment.
||||||
|-|-|-|-|-|
||Amount in year-end||||
|Debtor|||||
||Account receivable|Bad debt provision|Proportion(%)|Reason for allowance|
|||||It has been included in|
|Dongguan Fair LCD Co.,||||the list of national courts|
||1,698,528.55|1,698,528.55|100.00||
|Ltd.||||dishonest debtor, unlikely|
|||||to recover.|
|||||Beyond the credit period|
|Guangdong Ruili Baolai|||||
||1,418,965.36|709,482.68|50.00|f or a long time, uncertain|
|Technology Co., Ltd.|||||
|||||recovered.|
|||||Beyond the credit period|
|Dongguan Yaxing|||||
||3,255,542.75|1,627,771.37|50.00|f or a long time, uncertain|
|Semiconductor Co., Ltd.|||||
|||||recovered.|
|Total|6,373,036.66|4,035,782.60||--|

（2）Account receivable on which bad debt provisions are provided on age basis in the group
|||||
|-|-|-|-|
||Balance in year-end|||
|Aging||||
||Account receivable|Bad debt provision|Proportion(%)|
|Within 1 year|188,008,826.83|9,400,441.34|5.00|
|1-2 years|269,320.69|26,932.07|10.00|
|2-3 years|132,948.96|39,884.69|30.00|
|Over 3 years|618,444.20|309,222.10|50.00|
|Total|189,029,540.68|9,776,480.20||

2．Recognisation , recovery or reversal of allowance for baddebt：
（1）The account of allowance for bad debts recognised during the period is RMB3,899,615.51, The
amount collected or switches back amounting to 790,775.00.
（2）Bad debt provision accrual collected or switch back
Amount Allowance for
Name Recovery methods
receivable bad debts
Guangdong Ruili Baolai Technology 790,775.00
1,581,550.00 Cash and Bank acceptance
Co., Ltd.
Total 1,581,550.00 790,775.00
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements3．The company has no account receivables written off this period.
4.The ending balance of receivable owed by the imputation of the top five parties
|||||||
|-|-|-|-|-|-|
|Name|Nature|Balance inyear-end|Aging|Proportion(%)|Bad debt provision|
|Client 1|Goods|67,995,405.77|Within 1 year|33.72|3,399,770.29|
|Client 2|Goods|31,812,267.30|Within 1 year|15.77|1,590,613.37|
|Client 3|Goods|15,437,524.43|Within 1 year|7.65|771,876.22|
|Client 4|Goods|8,562,394.21|Within 1 year|4.25|428,119.71|
|Client 5|Goods|7,315,138.55|Within 1 year|3.63|365,756.93|
|Total||131,122,730.26||65.02|6,556,136.52|

 4.Prepayments
1．Disclosure by age
（1）Disclosure by age
||||||
|-|-|-|-|-|
||Balance in year-end||Balance in year-begin||
|Aging|||||
||Amount|Proportion（%）|Amount|Proportion（%）|
|Within 1 year(including|||||
||5,027,361.20|64.01|24,681,972.11|91.16|
|1 year)|||||
|1-2 years|1,033,416.99|13.16|2,298,742.28|8.49|
|2-3 years|1,754,880.00|22.34|94,380.42|0.35|
|Over 3 years|38,160.00|0.49|||
|Total|7,853,818.19|100.00|27,075,094.81|100.00|

 (2)Notes of the reasons of the prepayment ages over 1 year with significant amount but failed settled
in time
|||||
|-|-|-|-|
|Claims unit|Debt unit|Balance in year-end|Aging|
|Shenzhen Textile（Holdings）Co., Ltd.|Shenzhen FutianDistrict Housing andConstruction Bureau|1,754,880.00|2-3 years|

S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements 2.The ending balance of Prepayments owed by the imputation of the top five parties
||||
|-|-|-|
|Name|Balance in year-end|Proportion|
|First|1,754,880.00|22.35|
|Second|981,952.10|12.50|
|Third|438,461.55|5.58|
|Fourth|437,459.86|5.57|
|Fifth|219,687.79|2.80|
|Total|3,832,441.30|48.80|

 5.Interest receivable
1.Category of interest receivable
In RMB
||||
|-|-|-|
|Items|Balance in year-end|Balance in year-begin|
|Fixed deposit interest|13,357,311.32|5,520,035.21|
|Structure deposit interest||706,164.38|
|Total|13,357,311.32|6,226,199.59|

 6.Other receivable
1．Category of Other receivable
In RMB
Amount in year-end
Book balance
Bad debt provision
Classification
Amount Proporti Amount Withdrawal
Book value
on(%) proportion
(%)
Other accounts receivable of
individual significance and
11,981,464.60 19.67 11,981,464.60 100.00
subject to individual
impairment assessment
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements Amount in year-end
Book balance
Bad debt provision
Classification
Amount Proporti Amount Withdrawal
Book value
on(%) proportion
(%)
Other accounts receivable
subject to impairment
48,425,735.21 79.49 3,292,063.11 6.80 45,133,672.10 assessment by credit risk
characteristics of a portfolio
Other accounts receivable of
individual insignificance but
511,820.77 0.84 511,820.77 100.00
subject to individual
impairment assessment
Total 60,919,020.58 100.00 15,785,348.48 45,133,672.10 Amount in year-begin
Classification
Book balance
Bad debt provision
Book value
Proport Withdrawal
Amount Amount
ion(%) proportion(%)
Other accounts receivable of
individual significance and
11,981,464.60 20.88 11,981,464.60 100.00
subject to individual
impairment assessment
Other accounts receivable
subject to impairment
44,880,159.19 78.23 3,036,781.80 6.77 41,843,377.39
assessment by credit risk
characteristics of a portfolio
Other accounts receivable of
individual insignificance but
511,820.77 0.89 511,820.77 100.00
subject to individual
impairment assessment
Total 57,373,444.56 100.00 15,530,067.17 41,843,377.39
Other receivable accounts with large amount and were provided had debt provisions individually at
end of period.
|||
|-|-|
||Amount in year-end|
|Debtor||

S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
||||||
|-|-|-|-|-|
||||Withdrawal proportion||
||Other account receivable|Bad debt provision||Reason for allowance|
||||(%)||
|Jiangxi Xuanli String||||No executable property,|
||11,389,044.60|11,389,044.60|100.00||
|Co., Ltd.||||unlikely to recover.|
|Shenzhen Tianlong||||Has been|
|Induatry& Trade Co.,|592,420.00|592,420.00|100.00|conceled,unlikely to|
|Ltd.||||recover|
|Total|11,981,464.60|11,981,464.60||--|

(2)Other receivable accounts in Group on which bad debt provisions were provided on age analyze
basis：
|||||
|-|-|-|-|
||Amount in year-end|||
|Aging||||
||Other receivable|Bad debt provision|Withdrawal proportion|
|Within 1 year|44,339,566.81|2,216,978.35|5.00|
|1-2 years|2,237,253.61|223,725.36|10.00|
|2-3 years|365,489.98|109,646.99|30.00|
|Over 3 years|1,483,424.81|741,712.41|50.00|
|Total|48,425,735.21|3,292,063.11||

2.The current amount of provision for bad debts is RMB255,281.31, no withdraw or return for bad
debts.
3．The company has no other receivables written off this period.
4.Other accounts receivable classified by the nature of accounts
Category
Year-end balance Year-beginning balance
The equity transfer 2,276,015.00
Export rebate 37,916,465.75 37,329,677.22 Unit account 16,318,999.87 14,476,263.97 Deposit 2,024,236.32 2,074,647.36 Reserve fund and staff loans 968,214.01 1,058,737.57 Other 1,415,089.63 2,434,118.44
Total 60,919,020.58 57,373,444.56
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements 5.Top 5 of the closing balance of the other accounts receivable colleted according to the arrears
party
Proportion of Bad debt
the total year provision
Name Nature Closing balance Aging end balance of
the accounts
Closing balancereceivable(%)
First Export rebate
37,916,465.75 Within 1 year 62.25 1,895,823.29 Second Unit account
11,389,044.60 Over 3 years 18.69 11,389.044.60 1,800,000.00 Within 1 year 2.95 90,000.00 Third
1,800,000.00 1-2 years 2.95 180,000.00 Unit account
Fourth Equity transfer
2,276,015.00 Within 1 year 3.74 113,800.75 Fifth Deposit 980,461.06 Over 3 years 1.61 490,230.53 Total
56,161,986.41 92.19 14,158,899.17 7.Inventories
（1）Inventories types
In RMB
||||||||
|-|-|-|-|-|-|-|
||Year-end balance|||Year-beginning balance|||
|Items|Book balance|Provision for bad|Book value|Book balance|Provision for bad|Book value|
|||debts|||debts||
|Raw materials|150,409,810.60|14,406,278.95|136,003,531.65|96,253,606.72|18,042,269.08|78,211,337.64|
|Processing|||||||
||6,871,382.66|493,094.77|6,378,287.89|6,209,041.89||6,209,041.89|
|products|||||||
|Finished product|128,415,576.27|30,161,550.92|98,254,025.35|116,534,286.34|25,965,053.01|90,569,233.33|
|Semi-finished|||||||
||90,791,967.01|22,652,767.02|68,139,199.99|76,759,022.66|21,506,818.01|55,252,204.65|
|product|||||||
|Turnover|||||||
|||||133,102.72||133,102.72|
|materials|||||||
|Designated|||||||
|processing||||284,202.01||284,202.01|
|material|||||||

S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
||||||||
|-|-|-|-|-|-|-|
|Total|376,488,736.54|67,713,691.66|308,775,044.88|296,173,262.34|65,514,140.10|230,659,122.24|

（2）Inventory Impairment provision
||||||||
|-|-|-|-|-|-|-|
|||Increased in current period||Decreased in current period|||
||Year-beginning||||||
|Items||||||Year-end balance|
||balance|Provision|Other|Transferred back|Other||
|Raw materials|18,042,269.08|5,678,191.34||9,314,181.47||14,406,278.95|
|Finished product|25,965,053.01|25,463,253.58||21,266,755.67||30,161,550.92|
|Semi-finished|||||||
||21,506,818.01|17,179,570.89||16,033,621.88||22,652,767.02|
|product|||||||
|Processing||||||493,094.77|
|||493,094.77|||||
|products|||||||
|Total|65,514,140.10|48,814,110.58||4 6,614,559.02||6 7,713,691.66|

 8.Other current assets
||||
|-|-|-|
||Year-end balance|Year-beginning balance|
|Items|||
|Structural Deposit|460,000,000.00||
|After the deduction of input VAT|53,553,675.47|61,748,415.41|
|Total|513,553,675.47|61,748,415.41|

 9.Available-for-sale financial assets
(1)Available-for-sale financial assets
||||||||
|-|-|-|-|-|-|-|
||Year-end balance|||Year-beginning balance|||
|Items|||||||
|||Bad debt|||Bad debt||
||Book balance||Book value|Book balance||Book value|
|||provision|||provision||
|Available-for-sale equity||||124,282,285.6|||
||79,931,512.57|36,689,988.51|43,241,524.06||36,689,988.51|87,592,297.11|
|instruments||||2|||
|Measured by fair value|10,054,476.60||10,054,476.60|52,605,249.65||52,605,249.65|
|Measured by cost|69,877,035.97|36,689,988.51|33,187,047.46|71,677,035.97|36,689,988.51|34,987,047.46|
||||43,241,524.06|124,282,285.6||87,592,297.11|
|Total|79,931,512.57|36,689,988.51|||36,689,988.51||
|||||2|||

S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements (2)Available-for-sale financial assets measured by fair value at the period-end
Items Cost Fair value
Available-for-sale financial instrument 8,940,598.31 10,054,476.60Fawer（000030） 8,940,598.31 10,054,476.60 Total 8,940,598.31 10,054,476.60 (2)Available-for-sale financial assets measured by cost at the period-end
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
||Book balance||||Impairment provision||||Shareholdi|Cash|
||||||||||ng|bonus of|
|Investee|Period-beg||||Period-beg||||proportion|the|
|||Increase|Decrease|Period-end||Increased|Decreased|Period-end|||
||in||||in||||among the|reporting|
||||||||||investees|period|
|Shenzhen|||||||||||
|Jintian|||||||||||
|Industry|||||||||||
|（Group）|14,831,68|||14,831,68|14,831,68|||14,831,68|||
|Co., Ltd.|1.50|||1.50|1.50|||1.50|3.68||
|Shenzhen|||||||||||
|Jiafeng|||||||||||
|Textile|16,800,00|||16,800,00|16,800,00|||16,800,00|||
|Co., ltd.|0.00|||0.00|0.00|||0.00|10.80||
|Shenzhen|||||||||||
|Guanhua|||||||||||
|Prnting &|||||||||||
|dyeing|5,491,288|||5,491,288|5,058,307|||5,058,307|||
|Co., Ltd.|.71|||.71|.01|||.01|45.00||
|Shenzhen|||||||||||
|Union|||||||||||
|Developm|||||||||||
|ent Group|2,600,000|||2,600,000||||||156,000.0|
|Co., Ltd|.00|||.00|||||2.87|0|
|Shenzhen|160,000.0|||160,000.0|||||||
|Xiangjiang|0|||0|||||20.00|84,587.22|

S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
|||||||||
|-|-|-|-|-|-|-|-|
|Trade Co.,||||||||
|Ltd.||||||||
|Shenzhen||||||||
|Xinfang||||||||
|Knitting|524,000.0||524,000.0|||||
|Co., Ltd.|0||0|||20.00|54,000.00|
|Shenzhen||||||||
|Dailisi||||||||
|Knitting|2,559,856||2,559,856||||788,870.0|
|Co., Ltd.|.26||.26|||30.00|0|
|Anhui||||||||
|Huapeng||||||||
|Textile|25,410,20||25,410,20||||1,800,000|
|Co., Ltd.|9.50||9.50|||50.00|.00|
|Shenzhen||||||||
|South||||||||
||1,500,000||1,500,000||||658,819.4|
|Textile||||||||
||.00||.00|||9.84|0|
|Co., Ltd.||||||||
|Shenzhen||||||||
|Tongyi||||||||
||1,800,000|1,800,000|||||685,344.9|
|Silk Co.,||||||||
||.00|.00|||||5|
|Ltd.||||||||
||71,677,03|1,800,000|69,877,03|36,689,98|36,689,98||4,227,621|
|Total||||||||
||5.97|.00|5.97|8.51|8.51||.57|

 In the reporting period,18% Equity of Tongyi with assessed value RMB 45.5203 million was
transferred to Shenzhen Fenghuirun Investment Co., Ltd; Shenzhen Dailisi Knitting Co., Ltd. and Anhui
Huapeng Textile Co., Ltd. provided foreign contract in the current period.
(4)Changes of the impairment of the available-for-sale financial assets during the reporting period
Available for sale equity Available for sale
Category Total
instruments debts instruments
Impairment amount at the beginning 37,301,142.97 37,301,142.97
period
Current provision
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements Available for sale equity Available for sale
Category Total
instruments debts instruments
Including: Transferred from other
comprehensive income
Decreased of this period
Including:transferred from the 611,154.46 611,154.46
increased fair value
Impairment amount at the end of
period 36,689,988.51 36,689,988.51
Fawer Shares（000030）the company held impairment loss at the last period of RMB
2,947,341.67, the current value raised, the reversal of impairment losses of RMB 611,154.46
through equity.
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements 10.Long-term equity investment
(1)Long-term equity investment
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
|||Increase/decrease||||||||||
||||||||||||Closing|
||||||Adjustme|||||||
||||||||Cash|Withdraw|||balance|
|||||Gains/los|nt of|||||||
||Opening|Add|Investme|||Changes|bonus or|al of||Closing|of|
|Investees||||||||||||
|||||s of|other|||||||
||balance|investmen|nt|||of other|profits|impairme|Other|balance|impairme|
|||||Investme|comprehe|||||||
|||t|decreased|||equity|announce|nt|||nt|
|||||nt|nsive|||||||
||||||||d to issue|provision|||provision|
||||||income|||||||
|I. Joint venture||||||||||||
|Shenzhen||||||||||||
|Haohao||||||||||||
|Property||||||||||||
|Leasing|3,762,40|||635,434.1||||||4,397,840||
|Co., Ltd.|6.73|||5||||||.88||
|Shenzhen||||||||||||
|Xieli||||||||||||
|Automobil|3,675,12|||386,836.5||||||4,061,958|266,654.9|
|e Co., Ltd.|2.44|||2||||||.96|9|
||7,437,52|||1,022,270||||||8,459,799|266,654.9|
|Subtotal||||||||||||
||9.17|||.67||||||.84|9|
|2. Affiliated Company||||||||||||
|Shenzhen||||||||||||
|Changlianf||||||||||||
|a Printing||||||||||||
|& dyeing|1,814,15|||||||||1,871,377||
|Company|8.78|||57,218.31||||||.09||
|Jordan||||||||||||
|Garment|3,262,74|||-76,209.2|197,479.0|||||3,384,014||
|Factory|4.69|||3|3|||||.49||
|Hongkong||||||||||||
|Yehui|8,547,27|||1,427,762|||545,386.5|||9,430,732||
|Internation|9.68|||.45|1,077.00||0|||.63||

S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
||||||||
|-|-|-|-|-|-|-|
|al Co.,|||||||
|Ltd.|||||||
||13,624,1|1,408,771|198,556.0|545,386.5|14,686,12||
|Subtotal|||||||
||83.15|.53|3|0|4.21||
||21,061,7|2,431,042|198,556.0|545,386.5|23,145,92|266,654.9|
|Total|||||||
||12.32|.20|3|0|4.05|9|

 Shenzhen Xieli Automobile Co., Ltd. Business license has been revoked the business sector.
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements 11.Investment real estate
（1）Measured by the cost of investment in real estate
||||||
|-|-|-|-|-|
|Items|House, Building|Land use right|Construction in process|Total|
|I. Original price|||||
|1. Balance at|||||
||254,042,931.46|||254,042,931.46|
|period-beginning|||||
|2.Increase in the current|||||
||60,000.00|||60,000.00|
|period|||||
|3.Decrease in the current|||||
||1,817,038.92|||1,817,038.92|
|period|||||
|4 Year-end balance|252,285,892.54|||252,285,892.54|
|II.Total accumulated|||||
|depreciation accumulated|||||
|amortization|||||
|1. Year-begin balance|113,137,656.01|||113,137,656.01|
|2.Increase in the current|||||
||6,575,312.40|||6,575,312.40|
|period|||||
|(1).Provision or|||||
||6,575,312.40|||6,575,312.40|
|amortization|||||
|3.Decrease in the current|||||
||1,817,038.92|||1,817,038.92|
|period|||||
|4 Year-end balance|117,895,929.49|||117,895,929.49|
|4. Balance at period-end|||||
|III. Impairment provision|||||
|1. Balance at|||||
|period-beginning|||||
|2.Increased amount of|||||
|the period|||||
|3.Decrease in the|||||
|current period|||||
|4. Balance at period-end|||||
|IV.Book value|134,389,963.05|||134,389,963.05|
|1.Book value at period|140,905,275.45|||140,905,275.45|

S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
||||
|-|-|-|
|-end|||
|2.Book value at||140,905,275.45|
||140,905,275.45||
|period-beginning|||

12. Fixed assets
（1）Fixed assets
Electronic
House and Machinery
Transportation
Items Equipment and Total
buildings equipment
equipment
other
I.Original book value
1. Year-beginning 477,461,993.94 633,688,396.11 3,691,157.72 18,266,876.86 1,133,108,424.63 balance
2. Increased at this 18,163,742.62 19,105,781.35 1,630,732.31 38,900,256.28 period
（1）Purchase 903,094.00 3,571,969.74 1,630,732.31 6,105,796.05（2） 17,260,648.62 15,533,811.61 32,794,460.23 Transferredfromconstruct
3. Decreased at 5,573,724.08 622,103.56 434,356.71 6,630,184.35 ion in -progress
this period
（1）Disposal or scrap 5,573,724.08 622,103.56 434,356.71 6,630,184.35 4 Year-end balance 490,052,012.48 652,172,073.90 3,691,157.72 19,463,252.46 1,165,378,496.56 II. Accumulated
depreciation
1. Year-beginning 76,531,202.95 217,981,340.78 2,363,208.73 11,126,071.22 308,001,823.68 balance
2. Increased at this 13,946,557.06 58,087,101.46 365,764.49 1,324,654.47 73,724,077.48 period
（1）Provision 13,946,557.06 58,087,101.46 365,764.49 1,324,654.47 73,724,077.48 3.Decreased at this
5,573,724.08 444,802.17 348,365.51 6,366,891.76 period
（1）Disposal or scrap 5,573,724.08 444,802.17 348,365.51 6,366,891.76 4. Year-end balance 84,904,035.93 275,623,640.07 2,728,973.22 12,102,360.18 375,359,009.40 III. Impairment
allowance
1. Year-beginning 235,233.62 235,233.62 balance
2. Increased at this
period
3. Decreased at this 235,233.62 235,233.62 period
4. Year-end balance
IV.Book value
S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements Electronic
House and Machinery
Transportation
Items Equipment and Total
buildings equipment
equipment
other
1. Closing book value 405,147,976.55 376,548,433.83 962,184.50 7,360,892.28 790,019,487.16 2. Book value at year 400,930,790.99 415,707,055.33 1,092,715.37 7,140,805.64 824,871,367.33 beginning
(2)Fixed assets with un-completed property certificates
||||
|-|-|-|
|Items|Book Value|Reasons for un-completed certificate|
|TFT-LCD polarizing film project phase 1 fixed|||
|||Need to improve the relevant accreditation|
||288,049,723.38||
|||information|
|assets of houses and buildings|||

Notes
Current depreciation is RMB73,724,077.48 .The issue of fixed assets transferred from
construction in progress original price is RMB32,794,460.23.
2.Fixed assets with un-completed property certificates
Items Book Value Reasons for un-completed
certificate
TFT-LCD polarizing film project phase 1 fixed
Need to improve the relevant
accreditation information
assets of houses and buildings 296,998,079.44
13.Project under construction
（1）Project under construction
||||||||
|-|-|-|-|-|-|-|
||Year-end balance|||Year-beginning balance|||
|Items|Book balance|Provision for|Book Net value|Book balance|Provision for|Book Net value|
|||devaluation|||devaluation||
|TFT-LCD|||||||
|polarizing film II|||||||
||36,212,078.79||36,212,078.79|32,436,160.45||32,436,160.45|
|project|||||||
|Guanhua|||||||
||39,004,527.58||39,004,527.58|31,482,502.19||31,482,502.19|
|Building project|||||||

S Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
||||||
|-|-|-|-|-|
|Research and|||||
|development|||||
||||14,745,915.59|14,745,915.59|
|center expansion|||||
|project|||||
|Other|586,980.33|586,980.33|1,157,571.11|1,157,571.11|
|Total|75,803,586.70|75,803,586.70|79,822,149.34|79,822,149.34|

（2）Changes of significant construction in progress
Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
|||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
||||||||||||Including：||Source of fund|
|||||||||||Including：|Current|||
||||||||||Capitalizat|||||
|||||||||||The year|amount of|Capitalizat||
|||Amount at||Transferre|||||ion of|||||
||||Increase at||Other|Balance in|Proportion|Progress of||amount of|capitalizati|ion of||
|Name|Budget|year||d to fixed|||||interest|||||
||||this period||decrease|year-end|(%)|work||capitalizati|on of|interest||
|||beginning||assets|||||accumulat|||||
|||||||||||on of|interest|ratio（%)||
||||||||||ed balance|||||
|||||||||||interest||||
|TFT-LCD|||||||||||||Collect and Self-|
|polarizing|1,470.93m|32,436,160|3,775,918.|||36,212,0||||||||
||||||||2%|2%||||||
|film II|illion|.45|34|||78.79||||||||
|project||||||||||||||
|||32,436,160|3,775,918.|||36,212,0||||||||
|Total||||||||||||||
|||.45|34|||78.79||||||||

Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements 14.Intangible assets
（1）List of intangible assets
||||||
|-|-|-|-|-|
|Items|Land use right|Proprietary technology|Software|Total|
|I. Original price|||||
|1.Opening|||||
||48,765,130.50|11,825,200.00|1,876,780.00|62,467,110.50|
|balance|||||
|2.Increased|||||
||||61,500.00|61,500.00|
|amount of the|||||
|period|||||
|(1) Purchase|||61,500.00|61,500.00|
|3.Decreased at|||||
|thisperiod|||||
|4. Balance at|||||
||48,765,130.50|11,825,200.00|1,938,280.00|62,528,610.50|
|period-end|||||
|II.Accumulated|||||
|amortization|||||
|1. Balance at|||||
||8,417,706.45|11,825,200.00|452,801.16|20,695,707.61|
|period-beginning|||||
|2. Increase in the|||||
||965,603.28||240,363.27|1,205,966.55|
|current period|||||
|(1) Withdrawal|965,603.28||240,363.27|1,205,966.55|
|3.Decreased|||||
|amount of the|||||
|period|||||
|4. Balance at|||||
||9,383,309.73|11,825,200.00|693,164.43|21,901,674.16|
|period-end|||||
|III. Impairment|||||
|provision|||||
|1. Balance at|||||
|period-beginning|||||
|2. Increase in the|||||
|current period|||||
|3.Decreased|||||
|amount of the|||||
|period|||||
|4. Balance at|||||

Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
|||||
|-|-|-|-|
|period-end||||
|IV. Book value||||
|1.Book value at||||
||39,381,820.77|1,245,115.57|40,626,936.34|
|period -end||||
|2.Book value at||||
||40,347,424.05|1,423,978.84|41,771,402.89|
|period-beginning||||

15.Goodwill
1．General information
Increased at this .Decreased at
Balance in year-begin Balance in year-end Investee
period this period
Shenzhen Beauty Century
2,167,341.21 2,167,341.21 Garment Co., Ltd.
Shenzhen Shenfang Import and
82,246.61 82,246.61 Export Co., Ltd.
Shenzhen Shengbo
Optoelectronic Technology Co.,
9,614,758.55 9,614,758.55 Ltd
Total
11,864,346.37 11,864,346.37（2）Impairment allowance
Increased at this .Decreased at
Balance in year-begin Balance in year-end Investee
period this period
Shenzhen Beauty Century
2,167,341.21 2,167,341.21 Garment Co., Ltd.
Shenzhen Shenfang Import and
82,246.61 82,246.61 Export Co., Ltd.
Shenzhen Shengbo
Optoelectronic Technology Co.,
9,614,758.55 9,614,758.55 Ltd
Total
2,249,587.82 9,614,758.55 11,864,346.37
Notes：
The company has purchased52.05% stock equity of Shenzhen Shengbo Optoelectronic Technology Co., Ltd. In
June 2009, and has paid the consideration with the difference RMB9,614,758.55 after the shares of the fair value
Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements of the identifiable net assets deducted, which shall be recorded into the goodwill. the company has made the impairment test for the assets group combination including the goodwill, After testing, the goodwill impairment provision is RMB 9,614,758.55.
16. Long term amortize expenses
|||||||
|-|-|-|-|-|-|
||||Amortized expenses|||
|Items||Increase in this||Other loss|Balance in year-end|
||Balance in year-begin|||||
|||period||||
|Renovation fee|245,050.54|350,688.00|246,709.20||349,029.34|
|Other|315,826.52|14,616.00|45,930.36||284,512.16|
|Total|560,877.06|365,304.00|292,639.56||633,541.50|

 17. Deferred income tax assets/deferred income tax liabilities
（1）Details of the un-recognized deferred income tax assets
In RMB
||||||
|-|-|-|-|-|
||Balance in year-end||Balance in year-begin||
|Items|Deductible temporary|Deferred income tax|Deductible temporary|Deferred income tax|
||difference|assets|difference|assets|
|Assets depreciation|||||
||7,334,802.71|1,833,700.67|8,661,780.26|2,165,445.08|
|reserves|||||
|Unattained internal sales|||||
||2,858,879.80|428,831.98|2,947,994.35|442,199.15|
|profits|||||
|Total|10,193,682.51|2,262,532.65|11,609,774.61|2,607,644.23|

（2）Details of the un-recognized deferred income tax liabilities
In RMB
||||||
|-|-|-|-|-|
||Balance in year-end||Balance in year-begin||
|Items|||||
||Temporarily Deductable|Deferred Income Tax|Temporarily Deductable|Deferred Income Tax|
||or Taxable Difference|liabilities|or Taxable Difference|liabilities|
|Stock equity disposition|||||
|Stock equity disposition|||||
|of the temporary|||||
||42,291,900.69|10,572,975.17|||
|taxable difference and|||||
|the taxable income|||||
|Changes in fair value of|1,113,878.29|278,469.57|42,225,680.94|10,556,420.24|

Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
||||||
|-|-|-|-|-|
|financial assets|||||
|available for sale|||||
|Total|43,405,778.98|10,851,444.74|42,225,680.94|10,556,420.24|

 (3)Details of un-recognized deferred income tax assets
Items
Balance in year-end Balance in year-begin
Deductible temporary difference 85,512,740.17 81,167,910.31 Deductible loss 495,605,796.60 411,615,401.60 Total 581,118,536.77 492,783,311.91 Due to the uncertainty which exists in whether sufficient taxable income can be obtained in the future , therefore, delay-tax capital has not been confirmed.
（4）Deductible losses of the un-recognized deferred income tax asset will expire in the following years
|||||
|-|-|-|-|
|Year|Balance in year-end|Balance in year-begin|Remark|
|2017|134,292,559.16|134,292,559.16||
|2018|129,226,944.33|129,226,944.33||
|2019|148,095,898.11|148,095,898.11||
|2020|83,990,395.00|||
|Total|495,605,796.60|411,615,401.60|--|

18. Short-term loan
（1）Categories of short-term loans
In RMB
||||
|-|-|-|
|Items|Balance in year-end|Balance in year-Beginning|
|Credit loans|53,866,521.87|24,676,594.72|
|Total|53,866,521.87|24,676,594.72|

 19.Account payable
（1）Account payable
In RMB
||||
|-|-|-|
|Items|Balance in year-end|Balance in year-begin|
||221,732,534.76|147,154,864.20|
|Within 1 year|||

Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
||||
|-|-|-|
||339,044.59|364,150.98|
|1-2 years|||
||64,917.00|281,468.35|
|2-3 years|||
||187,643.43|48,196.00|
|3-4 years|||
||38,046.00|33,784.50|
|4-5 years|||
||5,166,622.82|5,144,218.32|
|Over 5 years|||
|Total|227,528,808.60|153,026,682.35|

（2）Significant accounts payable that aged over one year
The reason for not repaid or carried fo Items Balance in year-end
Age
rward
Will Taco Corporation 5,089,267.83 Over 5 years Quality dissension
Total 5,089,267.83
20. Advance account
（1） Advance account
||||
|-|-|-|
|Items|Balance in year-end|Balance in year-begin|
|Within 1 year|27,505,005.53|40,457,864.19|
|1-2 years|45,161.00|27,012.70|
|2-3 years|10,224.00|968.40|
|3-4 years||9,072.57|
|4-5 years||50.76|
|Over 5 years|639,024.58|640,541.38|
|Total|28,199,415.11|41,135,510.00|

 21.Payable Employee wage
（1）Payable Employee wage
||||||
|-|-|-|-|-|
|Items|Balance in year-begin|Increase in this period|Payable in this period|Balance in year-end|
|I. Short-term employee|37,736,705.46|121,924,801.52|125,103,684.58|34,557,822.40|
|benefits|||||

Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
||||||
|-|-|-|-|-|
|||9,307,301.55|8,557,301.55|750,000.00|
|II. Post-employment|||||
|benefits|||||
|III. Termination benefit||175,175.00|175,175.00||
|Total|37,736,705.46|131,407,278.07|133,836,161.13|35,307,822.40|

（2）Short-term remuneration
||||||
|-|-|-|-|-|
|Items|Balance in year-begin|Increase in this period|Payable in this period|Balance in year-end|
|||107,369,504.10|111,363,785.59||
|1.Wages, bonuses,|||||
||36,466,410.58|||32,472,129.09|
|allowances and subsidies|||||
|2.Employee welfare||5,323,050.11|5,323,050.11||
|3. Social insurance||2,457,634.32|2,457,634.32||
|premiums|||||
|Including：Medical||1,899,806.38|1,899,806.38||
|insurance|||||
|Work injury insurance||169,446.03|169,446.03||
|Maternity insurance||388,381.91|388,381.91||
|4. Public reserves for||4,452,911.39|3,932,911.39|520,000.00|
|housing|||||
|5.Union funds and staff|1,270,294.88|2,321,701.60|2,026,303.17|1,565,693.31|
|education fee|||||
|Total|37,736,705.46|121,924,801.52|125,103,684.58|34,557,822.40|

（3）Defined contribution plans listed
||||||
|-|-|-|-|-|
|Items|Balance in year-begin|Increase in this period|Payable in this period|Balance in year-end|
|1. Basic old-age||7,030,420.62|7,030,420.62||
|insurance premiums|||||
|2.Unemployment||545,800.73|545,800.73||
|insurance|||||
|3. Annuity payment||1,731,080.20|981,080.20||
|Total||9,307,301.55|8,557,301.55||

Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements 22.Tax Payable
||||
|-|-|-|
|Items|At end of term|At beginning of term|
|VAT|135,460.12|475,624.79|
|Business Tax|510,707.45|658,958.83|
|City Construction tax|31,836.84|58,577.68|
|Enterprise Income tax|12,570,466.83|6,320,905.10|
|Individual Income tax|480,334.74|386,166.15|
|House property Tax|750,607.19|750,603.03|
|Education surcharge|22,964.43|85,549.33|
|Other|180,265.49|176,209.64|
|Total|14,682,643.09|8,912,594.55|

 23.Interest Payable
（.1）Interest Payable
||||
|-|-|-|
|Items|At end of term|At beginning of term|
|Interest on long-term borrowings payable|39,000,625.75|32,806,459.08|
|Interest on short-term borrowings|88,262.21|230,759.60|
|Total|39,088,887.96|33,037,218.68|

 24.Other payable
（1）Disclosure by nature
||||
|-|-|-|
|Items|At end of term|At beginning of term|
|Engineering Equipment fund|59,222,758.80|44,921,304.26|
|Unit account|24,819,916.41|38,703,210.28|
|Deposit|19,151,806.04|11,209,176.63|
|Drawing expenses|2,879,640.37|2,872,752.99|
|Other|19,701,602.18|14,948,418.90|

Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
||||
|-|-|-|
|Total|125,775,723.80|112,654,863.06|

 25.Non-currentliabilitiesdue within 1 year
||||
|-|-|-|
|Items|At end of term|At beginning of term|
|Long-term borrowings due with in 1year|40,000,000.00|75,346,136.30|
|Total|40,000,000.00|75,346,136.30|

 The long-term borrowings at the end of period are the borrowings extended to the Company by Pingan Bank.Shenzhen Jiangsu Building Branch. Entrusted by Shenzhen Shenchao Technology Investment Co.,Ltd. 26.Long-term borrowings
（1）Long-term term borrowings
In rmb
||||
|-|-|-|
|Items|At end of term|At beginning of term|
|Credit borrowings|120,000,000.00|124,653,863.70|
|Total|120,000,000.00|124,653,863.70|

 The long-term borrowings at the end of period are the borrowings enxtended to the Company by Pingan Bank.Shenzhen Jiangsu Building Branch. Entrusted by Shenzhen Shenchao Technology Investment Co.,Ltd. 27.Deferredincome
||||||
|-|-|-|-|-|
||Balance in|Increase at this|Decrease at this||
|Items||||Balance in year-end|
||year-begin|period|period||
|Govemment Subsidy|66,546,079.96|45,202,608.00|12,224,522.38|99,524,165.58|
|Total|66,546,079.96|45,202,608.00|12,224,522.38|99,524,165.58|

Details of govemmentsubsidy：
||||||||
|-|-|-|-|-|-|-|
||||The||||
||Balance in||||||
|Items||New grantsamount of this|non-operating|Other changed|Balance in|Income related to|
||year-begin||revenue amount||year-end|assets|
|||period|of this period||||
|Textile special|||||||
||1,142,857.16||142,857.14|1,000,000.02|1,142,857.16|Related to assets|
|funds|||||||
|High-tech|||||||
|Industrialization|1,000,000.00||200,000.00|800,000.00|900,000.00|Related to assets|
|demonstration|||||||

Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
|||||||
|-|-|-|-|-|-|
|projects||||||
|National grant||||||
|fundsfor new flat||||||
||5,000,000.00|1,000,000.00|4,000,000.00|4,500,000.00|Related to assets|
|panel display||||||
|industry||||||
|Borrowing||||||
||1,209,722.08|241,944.44|967,777.64|1,088,749.87|Related to assets|
|discount||||||
|Government R &||||||
||7,909,980.00|7,909,980.00||3,954,990.00|Related to income|
|D subsidies||||||
|Grant funds for||||||
|TFT-LCD||||||
||9,533,333.34|1,300,000.00|8,233,333.34|8,883,333.34|Related to assets|
|polarizer industry||||||
|project||||||
|Grant funds for||||||
|TFT-LCD||||||
|polarizer narrow|4,000,000.00|500,000.00|3,500,000.00|3,750,000.00|Related to assets|
|line (line 5)||||||
|project||||||
|Purchase of||||||
|imported||||||
||1,377,377.58|175,090.20|1,202,287.38|1,289,832.48|Related to assets|
|equipment and||||||
|technology||||||
|Innovation and||||||
|venture capital||||||
||400,000.00|50,000.00|350,000.00|375,000.00|Related to assets|
|for TFT-LCD||||||
|polarier project||||||
|Shenzzhen||||||
|Engineering||||||
|laboratory||||||
|polarizing|500,000.00|37,500.00|462,500.00|500,000.00|Related to assets|
|material and||||||
|technical||||||
|engineering||||||
|Shenzhen||||||
|polarizingmateria||||||
||5,000,000.00|375,000.00|4,625,000.00|5,000,000.00|Related to assets|
|l and technical||||||
|engineering||||||

Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
||||||||
|-|-|-|-|-|-|-|
|Capital funding|||||||
|for Technology|3,000,000.00||225,000.00|2,775,000.00|3,000,000.00|Related to assets|
|Center|||||||
|Subsidy funds to|||||||
|support the|||||||
|introduction of a|115,104.80||14,388.10|100,716.70|107,910.72|Related to assets|
|dvanced technolo|||||||
|gy|||||||
|Grant funds for|||||||
|TFT-LCD|||||||
|polarizer narrow|15,000,000.00|||15,000,000.00|15,000,000.00|Related to assets|
|line (line 6)|||||||
|project|||||||
|Grant funds for|||||||
|TFT-LCD|||||||
|polarizer narrow|10,000,000.00|||10,000,000.00|10,000,000.00|Related to assets|
|line (line 6)|||||||
|project|||||||
|Grant funds for|||||||
|TFT-LCD|||||||
|polarizer narrow|500,000.00|||500,000.00|500,000.00|Related to assets|
|line (line 6)|||||||
|project|||||||
|Imported|||||||
|equipment and|||||||
|technology of|857,705.00|||857,705.00|857,705.00|Related to assets|
|discount interest|||||||
|funds|||||||
|key technology|||||||
|research and deve|||||||
|lopment projects||5,000,000.00||5,000,000.00|5,000,000.00|Related to assets|
|of optical|||||||
|compensation|||||||
|film for polarizer|||||||
|Strategic|||||||
|industries|||||||
|Development|||||||
|||20,000,000.00||20,000,000.00|18,152.00|Related to assets|
|fund of|||||||
|Guangdong|||||||
|Province|||||||

Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
||||||||
|-|-|-|-|-|-|-|
|Grants of|||||||
|Purchase|||||||
|equipment of|||||||
|||20,000,000.00||20,000,000.00||Related to assets|
|TFT-LCD|||||||
|polarizing film|||||||
|phase II project|||||||
|Energy saving|||||||
|transformation||202,608.00|52,762.50|149,845.50||Related to assets|
|grant funds|||||||
|Total|66,546,079.96|45,202,608.00|12,224,522.38|99,524,165.58|65,926,431.57|--|

Notes：
（1）According to the "Notice on National Development and Reform Commission to the General Office of the textile project management of the special funds" (Faigaiban[2006]2841), on December 22, 2006, the Company received "Textile special" funds RMB 2,000,000.00 from Shenzhen Finance Bureau. The company will use 14 years as asset depreciation period for amortization with the corresponding equipment in current period. The amortization in accordance with the corresponding equipment, The non-operating income in current period is RMB142,857.14, the ending balance of uncompleted amortization is RMB 1,000,000.02 .
(2) According to the document of Shenzhen Municipal Development and Reform Commission【2009】 No. 416 that "The Notice On issued the Governmental Investment Plan in 2009 on Zhong Ke New Industrial Internet Security Audit System and Other High-tech Industrialization Demonstration Project and the Public Testing and Consultation Service of Information Security Industry and other National High-tech Industrial Base Platform Projects”, on May 2009, the company received the Shenzhen Municipal Development and Reform Commission high-tech industrialization demonstration project supporting Capital RMB 2 million allocated by Shenzhen City Bureau of Finance for the construction of “The Project of the Construction Line of Polaripiece for TFT-LCD”.Our company will use 10 years as asset depreciation period for amortization in current period. The non-operating income in current period is RMB 200,000.00 and the balance amount of unfinished final amortization is RMB 800,000.00.
(3) According to the document of the Office of the State Development and Reform Commission on "The Office of the State Development and Reform Commission on the Reply of New Flat-Panel Display Industrialization Special Project” (Development and Reform OfficeHigh-Tech【2008】No. 2104), the company obtained the state subsidies RMB 10,000,000.00 from the State Development and Reform Commission New Flat-Panel Display Industrialization Special Project for the construction of “The Project of Polaripiece Industrialization for TFT-LCD”. On June 2009, December 2009 and April 2010, the company received the special subsidies of State Development and Reform Commission RMB 10,000,000.00. Our company will use 10 years as asset depreciation period for amortization. The non-operating income in current period is RMB100,000.00, the balance amount of unfinished final amortization is RMB 4,000,000.00;
（4）On December 2009 ,June 2011 and February 2013, the Company received a loan interest discount funds of
RMB 992,000.00, RMB 850,000.00 and RMB 483,000.00 allocated by Shenzhen Bureau of Finance for phase-II
alteration project. Our company will use 10 years as asset depreciation period for amortization in current
period.The non-operating income in current period is RMB 241,944.44 and the balance amount of unfinished final
Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements amortization is RMB967,777.64.
（5）The Company receivedR&D subsidy of RMB39,549,900.00 from the government according to Shen Cai Jian (2010) No. 101 Document - Circular of Plan for Use of Special Funds for the 14th Group of Significant High-tech Projects in 2010. The Company plans to invest these funds inR&D in five years from 2011. The non-operating income in current period is RMB 7,909,980.00, The final allocation has beencompleted。
（6）In accordance with the Notice of Forwarding the Reply of General Office of State Development and Reform Commission Regarding Special Plan for Strategic Transformation and Industrialization of Color TV Industry issued by Shenzhen Development and Reform Commission (Shen Fa Gai (2011) No. 823), State Development and Reform Commission approved including the project of industrialization of polarizer sheet for TFT-LCD of Shengbo Optoelectronic Company into the special plan for strategic transformation and industrialization of color TV industry in 2010 and appropriated national aid of RMB 10,000,000.00 to Shengbo Optoelectronic Company for the research and development in the process of the project of industrialization and the purchase of required software and hardware equipment. On June 2012 and September 2013, the company received the national grants of RMB 10,000,000.00.. According to the Notice of Issuing the Governmental Investment Plan for 2011 Regarding Demonstration Project of High-tech Industrialization Including Specialized Services Such As Disaster Recovery of Financial Information System issued by Shenzhen Development and Reform Commission (Shen Fa Gai (2012) No. 3), the Company received subsidy of RMB 3,000,000.00 for the project of industrialization of polarizer sheet for TFT-LCD in April 2012. Our company will use 10 years as asset depreciation period for amortization in current period.The non-operating income in current period is RMB1,300,000.00. and the balance amount of unfinished final amortization is RMB8,233,333.34.
（7）According to the Notice about the Plan for Supporting the Second Group of Enterprises in Biological, Internet, New Energy and New Material Industries with Special Development Funds (Shen Fa Gai (2011) No. 1782), the Company received subsidy of RMB 5,000,000.00 for the narrow-width line (line 5) of phase-I project of polarizer sheet for TFT-LCD on February 2012. The Company planned to amortize the subsidy over 10 years according to the depreciation period of relevant assets. The non-operating income in current period is RMB5,000,000.00 and the balance amount of unfinished final amortization is RMB3,500,000.00.
（8）On October 2013, The company received the grants for the purchase of imported equipment and technology in 2012 of RMB 1,750,902.00, the Company planned to amortize the subsidy over 10 years according to the depreciation period of relevant assets.The non-operating income in current period is RMB175,090.20 and the balance amount of unfinished final amortization is RMB1,202,287.38.
（9）On December2013，The company received the funds for innovation and entrepreneurship of of TFT-LCD polarizing project from Pingshan New District Development and Finance Bureau of RMB 500,000.00(matching funding category),the Company planned to amortize the subsidy over 10 years according to the depreciation period of relevant assets. The non-operating income in current period is RMB50,000.00 and the balance amount of unfinished final amortization is RMB350,000.00.
（10）On December2013，The company received the funds for innovation and entrepreneurship of of TFT-LCD polarizing project from Pingshan New District Development and Finance Bureau of RMB 500,000.00(matching funding category),the Company planned to amortize the subsidy over 10 years according to the depreciation period of relevant assets. The non-operating income in current period is RMB37,500.00 and the balance amount of unfinished final amortization is RMB462,500.00.
Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements（11）According to the Approval of Application of Shenzhen Shengbo Optoelectronic Technology Co., Ltd. for Project Funds for Shenzhen Polarization Material and Technology Engineering Laboratory (Shen Fa Gai (2012) No. 1385), Shenzhen Polarization Material and Technology Engineering Laboratory was approved to be established on the strength of Shengbo Optoelectronic with total project investment of RMB 24,390,000.00. As approved by Shenzhen Municipal People's Government, this project was included in the plan for supporting the fourth group of enterprises with special fund for the development of strategic new industries in Shenzhen in 2012 (new material industry). According to the Notice of Issuing the Plan for Supporting the Fourth Group of Enterprises with Special Fund for Development of Strategic New Industries in Shenzhen in 2012 (Shen Fa Gai (2012) No. 1241), the Company received subsidy of RMB 5,000,000.00 on December 2012 for purchasing instruments and equipment and improving existing technological equipment and test conditions. The fund gap will be filled by the Company through raising funds by itself. the Company planned to amortize the subsidy over 10 years according to the depreciation period of relevant assets. The non-operating income in current period is RMB375,000.00 and the balance amount of unfinished final amortization is RMB4,625,000.00.
（12）According to the “Announcement on the Identification of Technology Centers of 24 Enterprises including Shenzhen Yuanwanggu Information Technology Joint Stock Company Limited as the Municipal Research and Development Centers (Technical Center)” (SJMXXJS[2013] No.137), the research and development center of Shenzhen SAPO Photoelectric Co., Ltd. has been regarded as 2012 annual municipalR&D center. In December 2013, the company has received the funding subsidy of RMB3 million for the construction of the technical center. the Company planned to amortize the subsidy over 10 years according to the depreciation period of relevant assets. The non-operating income in current period is RMB225,000.00 and the balance amount of unfinished final amortization is RMB2,775,000.00.
(13)On March 2014 the company received the introduction of advanced technology import subsidy funds of RMB 143,881.00 from Shenzhen Finance Committee, the Company planned to amortize the subsidy over 10 years according to the depreciation period of relevant assets. The non-operating income in current period is RMB14,388.10 and the balance amount of unfinished final amortization is RMB100,716.70.
（14）According to the "Shenzhen Municipal Development and Reform Commission Reply for Shenzhen Shengbo Optoelectronic Technology Co., Ltd. application for local matching funds of TFT-LCD polarizing film II project (Line 6) " (Shenzhen DRC[2013]No. 1771), the company obtained TFT-LCD polarizing film II project (line 6) local matching funds of RMB 15,000,000.00 in April 2014.The fund gap will be filled by the Company through raising funds by itself. The subsidy will be amortized over the depreciation period from the day when relevant assets get ready for intended use.
（15）According to "National Development and Reform Commission issued on industrial transformation and upgrading projects
(2nd
industrial restructuring) notify the central budget for 2014 investment plan" (NDRC Investment[2014] No. 1280), the company obtained TFT- LCD polarizer II project (line 6) state grants of RMB 10,000,000.00 in December 2014.The fund gap will be filled by the Company through raising funds by itself. The subsidy will be amortized over the depreciation period from the day when relevant assets get ready for intended use.
（16）In December 2014, the company received innovation venture capital (matching funding category) for Ping Shan District Development and Finance Bureau of TFT-LCD polarizing film II project (line 6) of RMB 500,000.00.The fund gap will be filled by the Company through raising funds by itself. The subsidy will be
amortized over the depreciation period from the day when relevant assets get ready for intended use;
Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements（17）On September2014，The company received a discount of imported equipment and technology funds of RMB 857,705.00.The fund gap will be filled by the Company through raising funds by itself. The subsidy will be amortized over the depreciation period from the day when relevant assets get ready for intended use.
(18) On Jan. 2015, the company received RMB 5 million of grants for key technology research and development projects of optical compensation film for polarizer from Shenzhen Scientific and Technological Innovation Committee. The company will defer income share transferred in the current profit and loss on the basis of depreciation life as of the date of the predetermined workability state the related assets reach.
19. According to “Reply on Congregating Development in Emerging Industrial Area Strategic Pilot Implement Scheme of Guangdong Province ”(Reform and Development Office High-Tech[2013] No.2552, the Company received 20 million RMB of the pilot project fund( period II project of TFT-LCD polarizer).The company will defer income share transferred in the current profit and loss on the basis of depreciation life as of the date of the predetermined workability state the related assets reach.
20. According to Reform and Development Commission of Shenzhen Municipality sending the notice of “Reply of National Reform and Development Office on Investing in Petrifaction and Medicine Project within Central Budget of 2013 for Industry Structure Adjustment Special Project”(Reform and Development Commission of Shenzhen Municipality[2013]No.1449) , the Company received 20 million RMB of new production line of TFT-LCD polarizer project period II and equipment purchase subsidy in August 2015 and December 2015.The company will defer income share transferred in the current profit and loss on the basis of depreciation life as of the date of the predetermined workability state the related assets reach.
21. In 2015, the Company received the subsidy funds of 202,608.00 RMB on energy-saving reconstruction, amortized by 8-year depreciation life of the relevant asset, the no business income was 52,762.50 RMB at the current period, the ending balance without amortization was 149,845.50 RMB
28.Stock capital
|||||||||
|-|-|-|-|-|-|-|-|
|||Changed（+，-）||||||
||Balance in|||Capitalization|||Balance in|
|||Issuance of||||||
||year-begin||Bonus shares|of public|Other|Subtotal|year-end|
|||new share||||||
|||||reserve||||
|Total of capital|506,521,849.00||||||506,521,849.00|
|shares||||||||

29.Capital reserves
||||||
|-|-|-|-|-|
|Items|Year-beginning balance|Increase in the current|Decrease in the current|Year-end balance|
|||period|period||
|Share premium|1,574,407,414.34|||1,574,407,414.34|
|Other|10,722,637.03|||10,722,637.03|
|Total|1,585,130,051.37|||1,585,130,051.37|

Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements 30.Other Comprehensive income
|||||||||
|-|-|-|-|-|-|-|-|
|||Amount of current period||||||
||||Less ：|||||
|||Amount for|Previously rec||After - tax a|After - tax a||
||Year-beginni||||||Year-end|
|Items||the period|ognized in pro|Less：|ttributable t|ttributable t||
||ng balance||||||balance|
||||fit or loss in ot|||||
|||before inco||Income tax|o the parent|o minority s||
||||her comprehen|||||
|||me tax|||company|hareholders||
||||sive income|||||
|1.Other comprehensive income will||||||||
|be reclassified into||||||||
|income or loss in the future||||||||
|Including: remeasurement of net||||||||
|assets or net liabilities of defined||||||||
|benefit plans||||||||
|Share of other comprehensive income||||||||
|of the investee that cannot be||||||||
|transferred to profit or loss accounted||||||||
|for using the equity method||||||||
|2.Other comprehensive income|33,389,117.46||||-30,176,930.11||3,212,187.35|
|||1,923,588.7||||||
|reclassifiable to profit or loss in|||31,669,260.70|431,258.19||||
|||8||||||
|subsequent periods||||||||
|Including ： Share of other||||||||
|comprehensive income of the||||||||
|investee that cannot be||||||||
|transferred to profit or loss||||||||
|accounted for using the equity||||||||
|method||||||||
|Gains and losses from changes|33,421,401.11||||-30,375,486.14||3,045,914.97|
|||1,725,032.7||||||
|in fair value of financial assets|||31,669,260.70|431,258.19||||
|||5||||||
|available for sale||||||||
|Held-to-maturity investment||||||||
|that is reclassified as financial||||||||
|assets available for sale||||||||
|Effective gains(losses) arising from||||||||
|cash flow hedging instruments||||||||
|Translation differences of financial|-32,283.65|198,556.03|||198,556.03||166,272.3|

Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
||||||||
|-|-|-|-|-|-|-|
|statements denominated||||||8|
|Total of other comprehensive income|33,389,117.46|1,923,588.7|||-30,176,930.11|3,212,187.35|
||||31,669,260.70|431,258.19|||
|||8|||||

 31.Surplus reserve
||||||
|-|-|-|-|-|
|Items|Year-beginning balance|Increase in the current|Decrease in the current|Year-end balance|
|||period|period||
|Statutory surplus reserve|64,403,027.10|6,136,292.76||70,539,319.86|
|Total|64,403,027.10|6,136,292.76||70,539,319.86|

 The increase in the surplus reserves for the current period is caused by the legal surplus reserves withdrawn as per10% of the net profits of the parent company.
32.Retained profits
Items Amount of this period Amount of last period
Before adjustments: Retained profits at 6,805,203.33 124,997,823.59 the period end
Adjustment: Total unappropriated
profits at the beginning of the year
After adjustments: Retained profits at the 6,805,203.33 124,997,823.59 period beginning
Add: Net profit attributable to owners of 8,497,227.40 -113,591,328.26 the Company for the period
Less: Appropriation to statutory surplus 6,136,292.76 4,601,292.00 reserve
Appropriation to discretionary
s Au pr pp rol pu rs
ia
r tie os ne tr ov Ce
o mmon risk provision
Common stock dividend payable
Common stock dividends Converted to
shares
Retained profits at the period end 9,166,137.98 6,805,203.33 33.Business income, Business cost
（1）Business income
Items Amount of current period Amount of previous period
Income from Main Business 1,220,983,979.24 1,205,218,842.69
Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements Other Business income 5,762,812.38 5,733,705.88
Total 1,226,746,791.62 1,210,952,548.57
Main business cost 1,136,902,952.29 1,149,096,458.05
Other business cost 5,608,060.55 5,647,004.79
Total 1,142,511,012.84 1,154,743,462.84
（2）Mainbusiness（Industry）
Amount of current period Amount of previous period
Name
Business income Business cost Business income Business cost Domestic and foreign
429,639,819.01 423,199,182.16 418,662,598.31 415,021,559.43 trade
700,600,503.65 690,228,637.37 697,875,210.57 710,855,827.41 Manufacturing
Property management,
90,743,656.58 23,475,132.76 88,681,033.81 23,219,071.21 leasing
Total
1,220,983,979.24 1,136,902,952.29 1,205,218,842.69 1,149,096,458.05（3）Mainbusiness（Production）
Amount of current period Amount of previous period
Name
Business income Business cost Business income Business cost Property and rental
90,743,656.58 23,475,132.76 88,681,033.81 23,219,071.21 income
Textile income 25,205,284.70 27,117,500.23 36,871,877.02 30,147,926.39 Polaroid income 803,719,803.87 787,302,128.29 734,488,663.78 752,645,742.75 Trade income 301,315,234.09 299,008,191.01 345,177,268.08 343,083,717.70 Total 1,220,983,979.24 1,136,902,952.29 1,205,218,842.69 1,149,096,458.05（4）MainBusiness（Area）
Amount of current period Amount of previous period
Name
Business income Business cost Business income Business cost 446,846,597.09 396,404,251.87 427,602,892.57 343,117,315.91 Domestic
774,137,382.15 740,498,700.42 777,615,950.12 805,979,142.14 Oversea
Total 1,220,983,979.24 1,136,902,952.29 1,205,218,842.69 1,149,096,458.05（5）Operating income from top five clients
Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements Name Income Proportion
First 318,888,124.08 25.99% Second 300,886,664.10 24.53% Third 141,768,566.85 11.56% Fourth 40,520,628.95 3.30% Fifth 33,128,839.03 2.70% Total 835,192,823.01 68.08% 34.Business tax and subjoin
||||
|-|-|-|
|Items|Amount of current period|Amount of previous period|
|Business tax|4,569,235.38|4,627,582.53|
|Urban construction tax|456,427.96|534,309.40|
|Education surcharge|282,652.28|381,647.42|
|Other|2,316,656.14|2,362,429.89|
|Total|7,624,971.76|7,905,969.24|

 35.Sales expenses
||||
|-|-|-|
|Items|Amount of current period|Amount of previous period|
|Wage|3,328,467.06|4,363,205.11|
|Transportation changes|3,570,014.59|5,836,916.82|
|Exhibition fee|214,273.75|427,035.70|
|Advertising expenses|21,367.52|47,821.93|
|Business expenses|803,058.95|796,292.50|
|Samples and product loss|153,275.77|131,439.90|
|Other|3,653,457.09|2,464,913.21|
|Total|11,743,914.73|14,067,625.17|

Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements 36.Administrative expenses
||||
|-|-|-|
|Items|Amount of current period|Amount of previous period|
|Wage|43,599,715.93|39,927,512.63|
|Property insurance|531,310.04|520,476.41|
|Repair charge|1,040,496.65|320,063.00|
|Business entertainment|1,436,619.00|1,839,218.23|
|Travel expenses|1,135,661.35|1,415,640.88|
|Office expenses|1,487,998.89|1,731,141.43|
|Water and electricity|3,839,832.91|655,053.39|
|Tax|1,364,877.14|1,222,081.41|
|Lawsuit expenses|120,304.55|412,056.24|
|Agency expenses|1,710,285.57|2,457,575.02|
|R& D|30,867,294.24|55,070,970.28|
|Board fees|65,515.20|73,289.60|
|Other|7,945,060.22|6,300,185.37|
|Depreciation of fixed assets|6,370,639.10|4,948,505.73|
|Amortization of intangible assets|1,205,966.55|2,298,368.48|
|Amortization of long-term deferred|||
|expenses|134,803.96|49,821.45|
|Low consumables amortization|188,323.00|254,145.90|
|Total|103,044,704.30|119,496,105.45|

 37.Financial Expenses
||||
|-|-|-|
|Items|Amount of current period|Amount of previous period|
|Interest expenses|6,843,784.81|9,608,435.14|
|Interest income|-38,467,889.51|-33,143,531.65|
|Exchange loss|6,356,852.45|-7,497,707.98|

Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
||||
|-|-|-|
|Fees and other|818,934.15|639,963.89|
|Total|-24,448,318.10|-30,392,840.60|

38.Loss of assets impairment
||||
|-|-|-|
|Items|Amount of current period|Amount of previous period|
|I .Losses for bad debts|3,364,121.82|-5,232,365.43|
|II. Losses for falling price of inventory|48,814,110.58|56,794,403.85|
|III. Goodwill impairment|9,614,758.55||
|Total|61,792,990.95|51,562,038.42|

 39.Investment income
1.Detail
||||
|-|-|-|
|Items|Amount of this period|Amount of last period|
|Investment income from the disposal of|||
||2,431,042.20|1,788,818.78|
|long-term equity investment|||
|Investment income arising from disposal of|||
|long-term equity investment|||
|Hold the investment income during from|4,374,824.87|4,609,627.57|
|available-for-sale financial assets|||
|Investment income gain from available for sale|||
||88,006,690.51|16,896,190.19|
|financial assets|||
|Total|94,812,557.58|23,294,636.54|

 2.Long-term equity investment income by costing
Amount of current period Amount of previous
Name Reason to increase or decrease period
Shenzhen Haohao Property Leasing Co.,
635,434.15 574,502.13
Ltd.
350,422.87
386,836.52
Shenzhen Xieli Automobile Co., Ltd.
Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements Amount of current period Amount of previous
Name Reason to increase or decrease period
Shenzhen Changlianfa Printing and
55,707.44
57,218.31
dyeing Company
395,273.09
-76,209.23
Jordan Garment Factory
Yehui International Co., Ltd. 1,427,762.45 412,913.25
Total 2,431,042.20 1,788,818.78
40. Non-Operation income
1．Non-Operation income
|||||
|-|-|-|-|
|Items|Amount of current period|Amount of previous period|Recorded in the amount of the|
||||non-recurring gains and losses|
|Total gains from disposal of|235,533.62|135,925.51||
||||235,533.62|
|non-current assets||||
|Including：Gains from disposal||||
||235,533.62|135,925.51|235,533.62|
|of fixed assets||||
|Government Subsidy|21,420,940.38|16,688,387.98|21,420,940.38|
|Other|2,465,865.62|4,335,675.77|2,465,865.62|
|Total|24,122,339.62|21,159,989.26|24,122,339.62|

2．Government subsidy reckoned into current gains/losses
|||||
|-|-|-|-|
||||Assets-related/|
||Amount of this|Amount of last||
|Items|||income|
||period|period||
||||-related|
||||Related to the|
|Grant funds for TFT-LCD polarizer narrow line (line 5)||||
||500,000.00|500,000.00|assets|
|project||||
||||Related to the|
||175,090.20|175,090.20|assets|
|Purchase of imported equipment and technology||||
||||Related to the|
||142,857.14|142,857.14|assets|
|Textile special funds||||

Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
|||||
|-|-|-|-|
||||Related to|
||7,909,980.00|7,909,980.00|income|
|Government R & D subsidies||||
||||Related to the|
||200,000.00|200,000.00|assets|
|High-tech Industrialization demonstration projects||||
||||Related to the|
||1,000,000.00|1,000,000.00|assets|
|National grant fundsfor new flat panel display industry||||
||||Related to the|
|Loan subsidy interest allocated by Finance Commission||||
||241,944.44|241,944.44|assets|
|of Shenzhen Municipality||||
||||Related to the|
|Subsidy amortization of the projecto of TFT-LCD||||
||1,300,000.00|1,300,000.00|assets|
|polarizer industrialization||||
|Innovation entrepreneurship fund amortization of||||
||||Related to the|
|TFT-LCD polarizer period I project for Pingshan New||||
||50,000.00|50,000.00|assets|
|District Development and Finance Bureau||||
||||Related to the|
|Financing aid amortization of introducing advanced||||
||14,388.10|28,776.20|assets|
|technique||||
||||Related to|
|Innovation entrepreneurship subsidy of Pingshan New||||
||590,000.00||income|
|District Development and Finance Bureau||||
||||Related to|
|Reward funds for innovation of SASAC of Shenzhen||||
|||300,000.00|income|
|Municipality||||
||||Related to|
|Special fund subsidy of industry development of Futian||||
||63,000.00|32,000.00|income|
|District||||
|Financing aid of Finance Commission of Shenzhen||||
||||Related to|
|Municipality for optimizing foreign trade export||||
||74,623.00||income|
|structure||||
||||Related to|
|||6,380.00|income|
|Financing aid of the domestic market development||||
||||Related to|
||93,543.00|60,460.00|income|
|Subsidy of the exhibition||||
||||Related to|
|||250,000.00|income|
|Financing aid of science and technology platform||||
||||Related to|
||88,152.00|100,000.00|income|
|Interest subsidy||||
||||Related to|
|||200,000.00|income|
|Subsidy of dyeing polarizer project||||

Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
|||||
|-|-|-|-|
||||Related to|
|Incentive of outstanding science-and-technology||||
|||50,000.00|income|
|enterprise||||
||||Related to|
||8,287,100.00|4,140,900.00|income|
|High-tech major projects Special funds||||
|Shenzhen Engineering laboratory polarizing material and|||Related to|
|technical engineering|37,500.00||assets|
||||Related to|
|Shenzhen polarizing material and technical engineering||||
||375,000.00||assets|
||||Related to|
|Capital funding for Technology Center|225,000.00||assets|
||||Related to|
|Energy saving transformation grant funds amortization||||
||52,762.50||assets|
|Total|21,420,940.38|16,688,387.98||

41．Non-current expenses
|||||
|-|-|-|-|
||Amount of current period|Amount of previous period|The amount of non-operating|
|Items||||
||||gains & lossed|
|Total of non-current asset|260,642.59|83,643.89||
||||260,642.59|
|Disposition loss||||
|Incl: loss of fixed assets||||
||260,642.59|83,643.89|260,642.59|
|disposition||||
|Other|23.02|113.60|23.02|
|Total|260,665.61|83,757.49|260,665.61|

 42.Income tax expenses
(1)Income tax expenses
||||
|-|-|-|
||Amount of current period|Amount of previous period|
|Items|||
|Current income tax expense|24,352,326.20|14,590,550.96|
|Deferred income tax expense|10,302,193.13|36,941,833.66|
|Total|34,654,519.33|51,532,384.62|

(2)Reconciliation of account profit and income taxexpenses：
In RMB
Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
|||
|-|-|
|Items|Amount of current period|
|Total profits|43,151,746.73|
|Income tax computed in accordance with the applicable tax rate|10,787,936.68|
|Effect of different tax rate applicable to the subsidiary Company|905,254.95|
|Influence of income tax before adjustment|69,480.07|
|Influence of non taxable income|-3,054,186.40|
|Impact of non-deductible costs, expenses and losses|3,862,227.82|
|Affect the use of deferred tax assets early unconfirmed||
|deductible losses||
|The current period does not affect the deferred tax assets|22,083,806.21|
|recognized deductible temporary differences or deductible loss||
|Income tax expense|34,654,519.33|

 43.Other comprehensive income
1．Other comprehensive income items and income tax effects and transferred to profit and loss
||||
|-|-|-|
|Items|Amount of current period|Amount of previous period|
|I. Net amount included in other comprehensive|||
|income that cannot be transferred to profit or loss|||
|in the future|||
|I.Share of other comprehensive income of the investee that|||
|cannot be transferred to profit or loss accounted for using|||
|the equity method|||
|II. Net amount included in other comprehensive|||
|income that can be transferred to profit or loss in|-30,176,930.11|9,854,344.17|
|the future|||
|1.|||
|Share of other comprehensive income of the|||
|investee that can be transferred to profit or loss|||
|accounted for using the equity method|||
|Less：Previously recognized in other comprehensive|||
|income, Profit or loss in current period|||
|Subtotal|||

Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
||||
|-|-|-|
|Items|Amount of current period|Amount of previous period|
|2. The income gains (losses) amount of available for sale|||
||1,725,032.75|30,124,854.43|
|financial assets|||
|Less： Recognized in other comprehensive income that tax|||
||431,258.19|7,531,213.61|
|effect amount|||
|Less：Previously recognized in other comprehensive|||
||31,669,260.70|12,707,013.00|
|income, Profit or loss in current period|||
|Subtotal|-30,375,486.14|9,886,627.82|
|3.|||
||198,556.03|-32,283.65|
|Translation differences of financial statements|||
|denominated in foreign currencies|||
|Less：Previously recognized in other comprehensive|||
|income, Profit or loss in current period|||
|Subtotal|198,556.03|-32,283.65|
|III.Total of other comprehensive income|-30,176,930.11|9,854,344.17|

 2.Adjustment process of accounting profit and income tax expense
Gains and losses from
Foreign currency
changes in fair value of
Items translation differences Subtotal available for sale
of financial statements
financial assets
I. Beginning balance last year 23,534,773.29 23,534,773.29 II.Changes in the amount last year 9,886,627.82 -32,283.65 9,854,344.17 III.Beginning balance this year 33,421,401.11 -32,283.65 33,389,117.46 IV.Changes in the amount this year -30,375,486.14 198,556.03 -30,176,930.11 V.The year-end balance 3,045,914.97 166,272.38 3,212,187.35 44.Items of Cash flow statement
(1)Other cash received from business operation
||||
|-|-|-|
|Items|Amount of current period|Amount of previous period|
||54,399,026.00|31,641,326.00|
|Government Subsidy|||

Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
||||
|-|-|-|
||41,127,157.51|44,113,060.32|
|Bank deposit interest income and other|||
|Total|95,526,183.51|75,754,386.32|

 2.Other cash paid related to operating activities
Other cash paid relating to operating activities this period was RMB 50,155,116.37, mainly for the payment of the cost of sales and administration expenses.
3.Other Cash received related to investment activities
||||
|-|-|-|
|Items|Amount of current period|Amount of previous period|
|Structure deposit and income|30,591,780.82|201,803,986.29|
|Other||567,210.00|
|Total|30,591,780.82|202,371,196.29|

 (4)Cash paid related to other investment activities
In RMB
||||
|-|-|-|
|Items|Amount of current period|Amount of previous period|
|Structure deposit investment|490,000,000.00|100,000,000.00|
|Other|59,223.58||
|Total|490,059,223.58|100,000,000.00|

 45.Supplement Information for cash flow statement
（1）Supplement Information for cash flow statement
|||||
|-|-|-|-|
||Supplement Information|Amount of|Amount of|
|||current period|previous period|
||I. Adjusting net profit to cash flow from operating activities|||
||Net profit|8,497,227.40|-113,591,328.26|
||Add: Impairment loss provision of assets|15,178,431.93|-24,728,253.16|
||Depreciation of fixed assets, oil and gas assets and consumable biological|||
|||80,299,389.88|78,523,175.42|
||assets|||
|||1,205,966.55|2,298,368.48|
||Amortization of intangible assets|||
||Amortization of Long-term deferred expenses|292,639.56|385,402.12|
|Loss on disposal of fixed assets, intangible assets and other long-term|||-52,725.62|

Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
||||
|-|-|-|
|Supplement Information|Amount of|Amount of|
||current period|previous period|
|deferred assets|||
|Loss on scrap of fixed assets|25,108.97|444.00|
|Loss on fair value changes|||
|Financial cost|-12,222,940.66|5,937,407.06|
|Loss on investment|-94,812,557.58|-23,294,636.54|
|Decrease in deferred income tax assets|192,322.96|36,941,833.66|
|Increased of deferred income tax liabilities|10,572,975.17|-52,384,071.50|
|Decrease of inventories|-80,315,474.20|-7,352,419.31|
||11,626,183.95|-49,608,590.83|
|Decease of operating receivables|||
||99,045,226.43|102,121,539.16|
|Increased of operating Payable|||
|Other||-3,897,638.73|
|Net cash flows arising from operating activities|39,584,500.37|-48,701,494.05|
|II. Significant investment and financing activities that without cash|||
|flows:|||
|Debt-to-capital conversion|||
|Convertible loan due within 1 year|||
|Fixed assets acquired under financial lease|||
|3．Movement of cash and cash equivalents：|||
|Ending balance of cash|748,658,875.60|1,098,232,359.02|
|Less: Beginning balance of cash equivalents|1,098,232,359.02|943,913,951.68|
|Add：Ending balance of cash equivalents|||
|Less: Beginning balance of cash equivalents|||
|Net increase of cash and cash equivalents|-349,573,483.42|154,318,407.34|

 (2)Composition of cash and cash equivalents
In RMB
||||
|-|-|-|
|Items|Year-end balance|Year-beginning balance|

Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
||||
|-|-|-|
|I. Cash|1,098,232,359.02|943,913,951.68|
|Including：Cash at hand|8,588.42|85,537.12|
|Demand bank deposit|1,097,734,798.40|941,362,518.21|
|Demand other monetary funds|488,972.20|2,465,896.35|
|Depositing performs|||
|Loan to performs|||
|II. Cash equivalents|||
|Including：Debt instrument matured within|||
|three months|||
|III. Balance of cash and cash equivalents at|||
|the period end|||
||1,098,232,359.02|943,913,951.68|

 46.Foreign currency monetary items
(1)Foreign currency monetary items
|||||
|-|-|-|-|
||Closing foreign currency||Closing convert to RMB|
|Items||Exchange rate||
||balance||balance|
|Monetary funds||||
|Including：USD|8,497,366.48|6.4936|55,178,498.97|
|JPY|5,371,949.00|0.053875|289,413.75|
|HKD|154,976.76|0.83778|129,836.43|
|Account receivable||||
|Including：USD|9,770,547.62|6.4936|63,446,028.03|
|JPY|240,306.00|0.053875|12,946.49|
|HKD|278,280.00|0.83778|233,137.42|
|Other receivable||||
|Including：HKD|330,841.65|0.83778|277,172.52|
|Account payable||||
|Including：USD|17,319,633.39|6.4936|112,466,771.38|

Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
|||||
|-|-|-|-|
|JPY|1,731,904,956.09|0.053875|93,306,379.51|
|Other payable||||
|Including：USD|81,000.00|6.4936|525,981.60|
|JPY|24,567,800.00|0.053875|1,323,590.23|
|HKD|1,530,628.30|0.83778|1,282,329.78|
|Euro|51,500.00|7.0952|365,402.80|
|Short –term loans||||
|Including：USD|2,226,967.88|6.4936|14,461,038.63|
|JPY|731,424,283.00|0.053875|39,405,483.25|
|Interest payable||||
|Including：USD|260.20|6.4936|1,689.63|
|JPY|1,606,915.99|0.053875|86,572.60|

 VI. Change in consolidation scope
No change of scope of consolidation from last year.
VII. Equity in other entity
1. Equity in subsidiary
（1）Constitute of enterprise group
||||||||
|-|-|-|-|-|-|-|
|||||Share-holding ratio|||
|Subsidiary|Main operation|Registered place|Business nature|||Acquired way|
|||||Directly|Indirectly||
|Shenzhen Lishi|||||||
||||Domestic trade,||||
|Industry|Shenzhen|Shenzhen||||Establish|
||||Property||||
|Development Co.,|||||||
||||Management|100.00|||
|Ltd|||||||
||||Accommodation,|||Establish|
|Shenzhen|||||||
||Shenzhen|Shenzhen|||||
||||restaurants,||||
|Huaqiang Hotel||||100.00|||
||||business center;||||
|Shenfang||||||Establish|
|Property|Shenzhen|Shenzhen|Property||||
|Management Co.,|||Management||||
|||||100.00|||
|Ltd.|||||||

Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
||||||||
|-|-|-|-|-|-|-|
||||Production of|||Establish|
|Shenzhen Beauty|||||||
|Century Garment|Shenzhen|Shenzhen|fully electronic|100.00|||
||||jacquard knitting||||
|Co., Ltd.|||whole shape||||
|Shenzhen|||||||
||||Operating import||||
|Shengbo|Shenzhen|Shenzhen|||||
|||||||Purchase|
|Ophotoelectric|||||||
||||and export||||
|Technology Co.,|||||||
|||||100.00|||
|Ltd|||business||||
|Shenzhen|||Operating import||||
|Shenfang Import|Shenzhen|Shenzhen||||Establish|
||||and export||||
|& export Co.,|||||||
||||||100.00||
|Ltd.|||business||||
|Shengtou|||||||
||||Production and||||
|(Hongkong)|Hongkong|Hongkong||||Establish|
|Co.,Ltd.|||sales of polarizer||100.00||

2.Equity in joint venture arrangement or associated enterprise
(1) Significant joint venture arrangement or associated enterprise
||||||||
|-|-|-|-|-|-|-|
|||||Holding proportion(%)||The accounting|
|Joint venture or|||||||
|associated|Place of operation|Place of|Nature|||treatment of|
|||||Directly|Indirectly||
|||registration||||investment in|
|enterprise|||||||
|||||||associates|
|Shenzhen Haohao|||||||
|Property Leasing|Shenzhen|Shenzhen|Property leasing|50.00||Equity method|
|Co., Ltd.|||||||
|Shenzhen Xieli|||||||
|Automobile Co.,|Shenzhen|Shenzhen|Property leasing|50.00||Equity method|
|Ltd.|||||||
|Shenzhen|||||||
|Changlianfa|||||||
||Shenzhen|Shenzhen|Property leasing|40.25||Equity method|
|Printing and|||||||
|dyeing Company|||||||
|Jordan Garment|||||||
||Jordan|Jordan|Manufacturing|35.00||Equity method|
|Factory|||||||
|Yehui|||||||
|International Co.,|Hongkong|Hongkong|Manufacturing|22.75||Equity method|
|Ltd.|||||||

(2)Key financial information of significant joint venture or associated enterprise
Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements Year-beginning balance/
Year-end balance/ Amount
Amount of previous
of current period
period
Jointventure：
Total book value of the investment 8,193,144.85 6,720,327.40
Total amount of the pro rata calculation of the following
items
--Net profit 1,022,270.67 924,925.00
--Other Comprehensive income
--Total comprehensive income 1,022,270.67 924,925.00
Dividends received from joint ventures this period 474,378.22
Associatedenterprise：
Total book value of the investment 14,686,124.21 4,614,853.99
Total amount of the pro rata calculation of the following
items
--Net profit 1,408,771.53 863,893.78
--Other Comprehensive income 198,556.03 -32,283.65
--Total comprehensive income 1,607,327.56 831,610.13
Dividends received from joint ventures this period 545,386.50
3. Significant common operation
|||||||
|-|-|-|-|-|-|
|||||Proportion /shareportion||
|Name|Main operating place|Registration place|Business nature|||
|||||Directly|Indirectly|
|Guanhua Building|Shenzhen|Shenzhen|Cooperate|50.16%||

According to the company along with Hongkong Qiaohui Industries Co.,Ltd. signed "Agreement on cooperative development and construction of Guanhua building", jointly developed Guanhua building construction, the compa ny invested50.16%, Hong Qiao Hui Industrial Co., Ltd. invested49.84%, the two sides need to agree matters affe cting the cooperation projects. In addition, the two sides agreed to the project is completed in accordance with the
ratio of the actual investment allocation or co-operation, specific programs need further deliberations.
As of the reporting period, Guanhua unfinished building projects.
Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements VIII. Risks Related to Financial Instruments
The company has the main financial instruments, such as bank deposits, receivables and payables, investments, loans and so on. Please refer to the relevant disclosure in Notes for the details. The risks associated with these financial instruments mainly include credit risk, market risk and liquidity risk. Thecompany’s management shall manage and monitor these risks and ensure above risks to be controlled within certain scope.
（I）Credit Risk
The credit risk of the company is primarily attributable to bank deposits and receivables. Of which, the bank deposits are mainly deposited in the medium and large commercial banks with strength, high credibility. For the receivables, the company has developed the relevant policies to control the credit risk, and set up the corresponding debt and credit limit after the credit status of debtor is evaluated based on financial condition of debtor, credit history, external ratings, possibility of guarantee obtained from the third party. Meanwhile, the company shall regularly monitor thedebtor’s credit history. With regard to the bad credit record for the debtor, the company shall adopt the written reminder, shortening or cancel of credit period to ensure the overall credit risks within the controllable scope.
（II）Market risk
Market risk of financial instrument arises from changes in fair value or future cash flow of financial instruments affected by market price . Market risks includes foreign exchange risk and interest risk.
(1) Interest Rate Risk
The interest rate risk faced by the company is mainly from the bank borrowings. The company is faced the interest rate risk of the cash flow due to the financial liability of the floating interest rate, and faced the interest rate risk of the fair value due to the financial liability of the fixed interest rate. The company shall determine the relative proportion in the fixed and floating interest rate contracts.
(2) Foreign Exchange Risk
The foreign exchange risks faced by the company are mainly from the financial assets and liabilities based on the price of US dollar and JPY. The company matches the income and expenditure of foreign currency as far as possible in order to reduce the foreign exchange risk.
（III）Liquidity risk
Liquidity risk refers to fund shortage problems when fulfilling obligations settled in cash or other financial assets. The company shall guarantee to have the sufficient funds to repay the debts through monitoring the cash balance, the marketable securities available to be cash and the rolling forecast for the future cash flow.
IX. The disclosure of the fair value
1. Closing fair value of assets and liabilities calculated by fair value
||||||
|-|-|-|-|-|
||Closing fair value||||
|Items|Fir value measurement|Fir value measurement|Fir value measurement||
|||||Total|
||items at level 1|items at level 2|items at level 3||
|I. Consistent fair value|||||

Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
||||
|-|-|-|
|measurement|||
|(1).Available for sale|||
||10,054,476.60|10,054,476.60|
|financial assets|||
|1.Equity instrument|||
||10,054,476.60|10,054,476.60|
|investment|||
|Total of Consistent fair|||
||10,054,476.60|10,054,476.60|
|value measurement|||

2. Market price recognition basis for consistent and inconsistent fair value measurement items at level
The fair value of financial assets available for sale at the end of period is measured based on the closing price of Shenzhen Stock Exchange on December 31,2016.
X. Related parties and related-party transactions
1.Parent company information of the enterprise
|||||||
|-|-|-|-|-|-|
|||||The parent company|The parent company|
||||Registered capital|||
|Name|Registered address|Nature||||
|||||of the Company's|of the Company’s|
||||（RMB’0000）|||
|||||shareholding ratio|vote ratio|
||18/F, Investment|Equity investment ,||||
|Shenzhen||||||
||Building, Shennan|Real-estate||||
|Investment Holdings|||2,145,000.00|46.21%|49.39%|
||Road, Futian|Development and||||
|Co.,Ltd.||||||
||District, Shenzhen|Guarantee||||

The company is authorized and approved to be state-owned independent company by Shenzhen Government, and it Executes financial contributor function on state-owned enterprise within authorization scope.
The finial control of the Company was ShenzhenPeople’s Govemment state owned assets supervision& Administration Commission.
2.Subsidiaries of the Company
Details refer to the Note VII-1, Interest in the subsidiary
3. Information on the joint ventures and associated enterprises of the Company
Details refer to the Note VII-2, Interests in joint ventures or associates
4.Other Related parties information
|||
|-|-|
|Other related party|Relationship to the Company|
|Shenzhen Shenchao Technology Investment Co., Ltd.|Subject to the same party controls|

Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
|||
|-|-|
|Shenzhen Tianma Microelectronics Co., Ltd.|Chairman of the Board Is the Vice Chairman of the Company|
|Shengbo （HK）Co., Ltd.|The Company Executives are Director of the company|
|Shenzhen Xiangjiang Trade Co., Ltd.|Sharing Company|
|Shenzhen Xinfang Knitting Co., Ltd.|Sharing Company|
|Shenzhen Dailishi Underwear Co., Ltd.|Sharing Company|
|Anhui Huapeng Textile Co., Ltd.|Sharing Company|

5. Related transactions.
1．Sales of goods and vendering of services
|||||
|-|-|-|-|
|Related party|Content|Amount of current period|Amount of previous period|
|Shenzhen Tianma||2,077,019.45|3,169,202.48|
||Sales polarizer sheet|||
|Microelectronics Co., Ltd.||||

2．Entrusted loans to related parties
For the construction of the project of polarizer sheet for TFT-LCD, the Company signed Entrusted Loan Contract with Shenzhen Shenchao Technology Investment Co., Ltd. and Shenzhen Jiangsu Building Sub-branch of Shenzhen Development Bank Co., Ltd. in 2010. According to the contract, Shenzhen Shenchao Technology Investment Co., Ltd. entrusted Shenzhen Jiangsu Building Sub-branch of Shenzhen Development Bank Co., Ltd. to extend a loan of RMB 200 million to the Company. The term of the loan is 108 months from the day when the first installment of entrusted loan is transferred to the account of the Company. The interest rate of the entrusted loan is the rate of commercial loans with a term of 5 years quoted by People's Bank of China minus2%. In case of adjustment of such commercial loan rate, the rate of commercial loans with a term of 5 years after adjustment minus2% shall apply as interest rate of entrusted loan from the first day of the next month after the adjustment of basic interest rate.As of December 31, 2015, The Company actually received a loan of RMB 160 million. 3. Rewards for the key management personnel
Items
Amount of current period Amount of previous period Rewards for the key management 4.3809 million 5.5268 million
personnel
6. Receivables and payables of related parties
（1）Receivables
|||||||
|-|-|-|-|-|-|
|||Amount at year end||Amount at year beginning||
|Name|Related party|||||
|||Balance of Book|Bad debt Provision|Balance of Book|Bad debt Provision|
||Shenzhen Tianma|||||
|Account receivable||349,938.59|17,496.93|568,133.34|28,406.67|
||Microelectronics|||||

Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
|||||||
|-|-|-|-|-|-|
||Co., Ltd.|||||
|Other Account|Anhui Huapeng|||||
|||3,600,000.00|270,000.00|1,800,000.00|90,000.00|
|receivable|Textile Company|||||
|Other Account|Shenzhen Dailishi|||||
|||277,172.52|13,858.63|257,450.22|12,872.51|
|receivable|Underwear Co., Ltd.|||||

（2）Payables
In RMB
|||||
|-|-|-|-|
|Name|Related party|Amount at year end|Amount at year beginning|
||Shenzhen Xinfang Knitting Co.,|||
|Other payable||244,789.85|244789.85|
||Ltd.|||
||Shenzhen Xiangjiang Trade|||
|Other payable||40,000.00|40,000.00|
||Co., Ltd.|||
||Shenzhen Changlianfa Printing|||
|Other payable||916,673.69|584,644.49|
||and dyeing Co., Ltd.|||
||Shenzhen Haohao Property|||
|Other payable||4,179,489.85|3,479,489.85|
||Leasing Co., Ltd.|||
|Other payable|Yehui International Co.,Ltd.|1,137,966.35|1,071,546.49|
|Other payable|Shengbo （Hongkong）Co., Ltd.|315,000.00|315,000.00|
||Shenzhen Shenchao Technology|||
|Interest payable||39,000,625.75|32,806,459.08|
||Investment Co., Ltd.|||

XI. Subsequent events
During the reporting period, the company received the No.28 respondent notice issued by Shenzhen Intermediate People's Court (2014) Foreign legislation, the plaintiff association of Hong Kong Xieli Automobile Co., Ltd liability disputes has been formally accepted. The company as the first defendant, Shenzhen Xieli Automobile Co., Ltd. was the second defendant. The plaintiff requested: 1, the economic loss of tort liability by the total amount of RMB 31.8579 million; 2, the second defendant involved in joint liability of the amount of compensation; 3, the litigation fee paid by two co-defendants. As of December 31,2015, this case was in process.
XII. Post-balance-sheet events
According to the dividend distribution preplan made by the board of directors of the Company, the Company will neither distribute profits nor capitalize capital surplus for the current period.
Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements XIII. Notes s of main items in financial reports of parent company
（1）Account receivable
1.Classification account receivables.
Year-end balance
Book balance Provision for bad debts
Classification
Book value
Proportio Proportion(
Amount Amount
n(%) %)
Accounts receivable of
individual significance and
subject to individual
impairment assessment
Accounts receivable subject to
impairment assessment by
862,162.70 100.00 43,108.13 5.00 819,054.57
credit risk characteristics of
a portfolio
Accounts receivable of
individual insignificance but
subject to individual
impairment assessment
Total 862,162.70 100.00 43,108.13 819,054.57
Year-beginning
Book balance Provision for bad debts
Classification
Book value
Proportio Proportion(
Amount Amount
n(%) %)
Accounts receivable of
individual significance and
subject to individual
impairment assessment
Accounts receivable subject to
impairment assessment by
credit risk characteristics of
a portfolio 493,566.28 100.00 24,678.31 5.00 468,887.97
Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements Year-beginning
Book balance Provision for bad debts
Classification
Book value
Proportio Proportion(
Amount Amount
n(%) %)
Accounts receivable of
individual insignificance but
subject to individual
impairment assessment
Total 493,566.28 100.00 24,678.31 468,887.97
In the groups, accounts receivable adopting aging analysis method to withdraw bad debt provision:
|||||
|-|-|-|-|
||Balance in year-end|||
|Aging||||
||Account receivable|Bad debt provision|Proportion(%)|
|Within 1 year|862,162.70|43,108.13|5.00|

 2.Other receivable
(1)Category of Other receivable
Year-end balance
Book balance
Provision for bad debts
Classification
Book value
Proportio Proportion(
Amount Amount
n(%) %)
Other Accounts receivable of
individual significance and
11,981,464.60 12.98 11,981,464.60 100.00
subject to individual
impairment assessment
Other Accounts receivable
subject to impairment
assessment by credit risk 79,979,624.27 86.68 7,435,914.49 9.30 72,543,709.78
characteristics of a
portfolio
Other Accounts receivable of
individual insignificance but
311,486.35 0.34 311,486.35 100.00
subject to individual
impairment assessment
Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements Year-end balance
Book balance
Provision for bad debts
Classification
Book value
Proportio Proportion(
Amount Amount
n(%) %)
Total 92,272,575.22 100.00 19,728,865.44 72,543,709.78
Year-beginning
Book balance
Provision for bad debts
Classification
Book value
Proportio Proportion(
Amount Amount
n(%) %)
Other Accounts receivable of
individual significance and
11,981,464.60 14.30 11,981,464.60 100.00
subject to individual
impairment assessment
Other Accounts receivable
subject to impairment
assessment by credit risk 71,511,079.72 85.33 6,929,687.26 9.69 64,581,392.46
characteristics of a
portfolio
Other Accounts receivable of
individual insignificance but
311,486.35 0.37 311,486.35 100.00
subject to individual
impairment assessment
Total 83,804,030.67 100.00 19,222,638.21 64,581,392.46
（1）Other Receivable accounts with large amount individually and bad debt provisions were provided
Balance at year-end
Other receivable（Unit）
Provision for bad debts Proportion% Reason Other receivable
Jiangxi Xuanli String Co., 11,389,044.60 11,389,044.60 Unable to 100.00
Ltd. recover
592,420.00 592,420.00 Unable to Shenzhen Tianlong Industry&
100.00
recover Unable Trade Co., Ltd.
to recover
Total 11,981,464.60 11,981,464.60
Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements（2）In the groups, other accounts receivable adopting aging analysis method to withdraw bad debt provision:
|||||
|-|-|-|-|
||Amount in year-end|||
|Aging||||
||Other receivable|Bad debt provision|Withdrawal proportion|
|Within 1 year|70,741,994.77|3,537,099.74|5.00%|
|1-2 years|1,800,000.00|180,000.00|10.00%|
|Over 3 year|7,437,629.50|3,718,814.75|50.00%|
|Total|79,979,624.27|7,435,914.49||

2.The amount of allowance for bad debt recovered or reversed during the current year is RMB506,227.23.
（3）Other accounts receivable classified by the nature of accounts
In RMB
||||
|-|-|-|
|Category|Year-end balance|Year-beginning balance|
|Internal current account|75,889,102.97|69,244,280.72|
|Unit account|16,251,300.27|14,431,577.97|
|Other|132,171.98|128,171.98|
|Total|92,272,575.22|83,804,030.67|

（4）The ending balance of other receivables owed by the imputation of the top five parties
Bad debt
Portion in total
Year-end
provision
Name Nature Age other
balance
Year-end
receivables(%)
balance
63,644,822.25 3,182,241.10 Within 1 year 68.98
First Internal current account
Second Unit account
11,389,044.60 Over 3 years 12.34 11,389,044.60 Third Internal current account
7,168,680.72 Over 3 years 7.77 3,584,340.36 5,000,000.00 Within 1 year 5.42 250,000.00 Fourth Internal current account
75,600.00 Over 3 years 0.08 37,800.00
1,800,000.00 Within 1 year 1.95 90,000.00
Fifth
Unit account
Total
1,800,000.00 1-2 Year 1.95 180,000.00
Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements Total
90,878,147.57 98.49 18,713,426.06 3.Long-term equity investment
||||||||
|-|-|-|-|-|-|-|
||Year-end balance|||Year-beginning balance|||
|Items||Bad debt|||Bad debt||
||Book balance||Book value|Book balance||Book value|
|||provision|||provision||
|Investment to thesubsidiary|||||||
||1,772,806,395.91|16,582,629.30|1,756,223,766.61|1,779,106,095.91|2,249,587.82|1,776,856,508.09|
|Investment tojoint ventures andassociatedenterprises|||||||
||23,145,924.05|266,654.99|22,879,269.06|21,061,712.32|266,654.99|20,795,057.33|
|Total|1,795,952,319.96|16,849,284.29|1,779,103,035.67|1,800,167,808.23|2,516,242.81|1,797,651,565.42|

（1）Investment to the subsidiary
||||||||
|-|-|-|-|-|-|-|
||||||Withdrawn||
|||||||Closing balance|
||||||impairment||
|Name|Opening balance|Increase|Decrease|Closing balance||of impairment|
||||||provision in the||
|||||||provision|
||||||reporting period||
|Shenzhen Shengbo|||||||
|Optoelectrionc|||||||
|Technology Co.,|||||||
||1,716,663,070.03|||1, 716,663,070.03|14,415,288.09|14,415,288.09|
|Ltd.|||||||
|Shenzhen Lisi|||||||
|Industrial|||||||
|Development Co.,|||||||
|Ltd.|8,073,388.25|||8,073,388.25|||
|Shenzhen Beauty|||||||
|Centruty Garment|||||||
|Co., Ltd.|30,867,400.00|||30,867,400.00||2,167,341.21|
|Shenzhen|||||||
|Shenfang Import|||||||
|& Export Co., Ltd|6,299,700.00||6,299,700.00||||
|Shenzhen|||||||
|Huaqiang Hotal|15,489,351.08|||15,489,351.08|||
|Shenfang Property|||||||
||1,713,186.55|||1,713,186.55|||
|Management Co.,|||||||

Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
||||||||
|-|-|-|-|-|-|-|
|Ltd.|||||||
|Total|1,779,106,095.91|0.00|6,299,700.00|1 ,772,806,395.91|14,415,288.09|16,582,629.30|

（2）Investment to joint ventures and associated enterprises
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
|||Increase /decrease in reporting period||||||||||
||||||||||||Closing|
||||||Adjustme|||||||
|||||||||Withdraw|||balance|
||||Decreas|Gain/loss|nt of||Declarati|||||
||Opening|Add||||Other||n||Closing|of|
|Name||||||||||||
||||ed|of|other||on of cash|||||
||balance|investme||||equity||impairme|Other|balance|impairme|
||||investm|Investme|comprehe||dividends|||||
|||nt||||changes||nt|||nt|
||||ent|nt|nsive||or profit|||||
|||||||||provision|||provision|
||||||income|||||||
|I. Joint ventures||||||||||||
|Shenzhen||||||||||||
|Haohao||||||||||||
|Property||||||||||||
|Leasing Co.,||||||||||||
||3,762,406.|||635,434.1||||||4,397,840||
|Ltd.||||||||||||
||73|||5||||||.88||
|Shenzhen||||||||||||
|Xieli||||||||||||
|Automobile||||||||||||
||3,675,122.|||386,836.5||||||4,061,958|266,654.9|
|Co., Ltd.||||||||||||
||44|||2||||||.96|9|
||7,437,529.|||1,022,270||||||8,459,799|266,654.9|
|Subtotal||||||||||||
||17|||.67||||||.84|9|
|II. Associated enterprises||||||||||||
|Shenzhen||||||||||||
|Changlianfa||||||||||||
|Printing and||||||||||||
|dyeing||||||||||||
||1,814,158.|||||||||1,871,377||
|Company||||||||||||
||78|||57,218.31||||||.09||
|Jordan||||||||||||
|Garnent||||||||||||
||3,262,744.|||-76,209.2|197,479.0|||||3,384,014||
|Factory||||||||||||
||69|||3|3|||||.49||

Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
||||||||
|-|-|-|-|-|-|-|
|Yehui|||||||
|International|||||||
||8,547,279.|1,427,762||545,386.5|9,430,732||
|Co., Ltd.|||||||
||68|.45|1,077.00|0|.63||
||13,624,18|1,408,771|198,556.0|545,386.5|14,686,12||
|Subtotal|||||||
||3.15|.53|3|0|4.21||
||21,061,712.32|2,431,042|198,556.0|545,386.5|23,145,924.05|266,654.99|
|Total|||||||
|||.20|3|0|||

 4.Business income and Business cost
（1）Business income
Items Amount of current period Amount of previous period
59,936,965.65 58,390,060.58
Income from Main Business
4,536,386.18 4,734,258.31
Other Business income
Total 64,473,351.83 63,124,318.89
Cost from Main Business 7,797,417.08 7,748,598.15
Other Business cost 4,536,386.16 4,734,258.26
Total 12,333,803.24 12,482,856.41
（2）Mainbusiness（Industry）
Amount of current period Amount of previous period
Name
Business income Business cost Business income Business cost
Rental industry 59,936,965.65 7,797,417.08 58,390,060.58 7,748,598.15
Total 59,936,965.65 7,797,417.08 58,390,060.58 7,748,598.15
（3）Mainbusiness（Production）
Amount of current period Amount of previous period
Name
Business income Business cost Business income Business cost
Rental industry 59,936,965.65 7,797,417.08 58,390,060.58 7,748,598.15
Total 59,936,965.65 7,797,417.08 58,390,060.58 7,748,598.15
Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements（4）Mainbusiness（Area）
Amount of current period Amount of previous period
Name
Business income Business cost Business income Business cost 59,936,965.65 7,797,417.08 58,390,060.58 7,748,598.15 Shenzhen
59,936,965.65 7,797,417.08 58,390,060.58 7,748,598.15 Total
（5）Operating income from top five clients
Name Business Income Proportion(%)
First 26,979,808.44 41.85% Second 1,778,880.00 2.76% Third 1,680,000.00 2.60% Fourth4 1,110,014.77 1.72% Fifth 890,400.00 1.38% Total 32,439,103.21 50.31% 5.Investment income
Items Amount of current Amount of previous period period
Income from long-term equity investment measured by adopting
8,048,378.51
the cost method
Income from long-term equity investment measured by adopting
2,431,042.20 1,788,818.79 the Equity method
Investment income arising from disposal of long-term eqiuty
427,368.86
investments
Investment income received from holding of available-for–sale
3,030,660.52 3,377,273.30 financial assets
The investment income procure from the available-for-sale
44,345,614.09 16,896,190.19 financial assets
Total 58,283,064.18 22,062,282.28 6. Supplement information of Cash Flow Statement
Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
||||
|-|-|-|
|Supplement information|Amount of|Amount of|
||current period|previous period|
|I. Adjusting net profit to cash flow from operating activities|||
|Net profit|||
||61,362,927.65|46,012,920.02|
|Add : Impairment loss provision of assets|||
||14,939,945.14|-5,163,448.04|
|Depreciation of fixed assets, oil and gas assets and consumable biological|||
||8,301,759.87|8,255,226.95|
|assets|||
|Amortization of intangible assets|310,526.55|614,528.48|
|Amortization of long-term deferred expenses|||
|Loss on disposals of fixed assets, intangible assets and other long-term|||
|assets(“-“for gains)|||
|Loss on discard of fixed assets|-222,212.70||
|Loss on fair value changes|||
|Financial expenses|-8,307,625.26|-1,392,989.91|
|||-22,062,282.2|
|Loss on investment|-58,283,064.18||
|||8|
|Decrease of deferred income tax assets|352,502.39|1,653,775.47|
|Increase of deferred income tax assets||-52,384,071.50|
|Decrease in inventories|||
|Decrease of operating receivable|-4,280,901.95|-1,764,126.72|
|Increase of operating recivable|17,119,385.28|9,804,230.15|
|Other||-3,897,638.73|
|Net cash flows arising from operating activities|31,293,242.79|-20,323,876.11|
|II. Significant investment and financing activities that without cash flows|||
|Debt-to –capital conversion|||
|Convertible loan due within 1 year|||
|Fixed assets acquired under financial lease|||

Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements
||||
|-|-|-|
|Supplement information|Amount of|Amount of|
||current period|previous period|
|3. Net Changes of cash and cash equivalents|||
|Ending balance of cash|271,582,749.03|457,379,886.16|
|Less: Beginning balance of cash|457,379,886.16|365,620,681.34|
|Add：End balance of cash equivalents|||
|Less: Beginning balance of cash equivalents|||
|Net increase of cash and cash equivalents|-185,797,137.13|91,759,204.82|

 XIV. Supplement information
1. Particulars about current non-recurring gains and loss
||||
|-|-|-|
|Items|Amount|Notes|
|Non-current asset disposal gain/loss|-25,108.97||
|Government subsidies recognized in current gain and|||
||21,420,940.38||
|loss(excluding those closely related to the Company’s|||
|business and granted under the state’s policies)|||
|Except for effective hedge business relevant to|||
|normal operation of the Company, gains and losses|||
|arising from fair value change of tradable financial|||
||88,006,690.51||
|assets and tradable financial liabilities, and|||
|investment income from disposal of tradable financial|||
|assets, tradable financial liabilities and financial|||
|assets available for sale|||
|Single impairment test for impairment of receivables|||
|transferred back to preparation|790,775.00||
|Other non-business income and expenditures other|||
||2,465,842.60||
|than the above|||
|Influenced amount of income tax|-11,902,114.51||
|Total|100,757,025.01||

Shenzhen Textile (Holdings) Co., Ltd. Notes to Financial Statements 2. Return on net asset and earnings per share
|||||
|-|-|-|-|
|||EPS||
|Profit as of reporting period|Weighted average ROE (%)|||
|||EPS-basic|EPS-diluted|
|Net profit attributable to the Common||0.02|0.02|
||0.39|||
|stock shareholders of Company.||||
|Net profit attributable to the Common||||
||-4.22|-0.18|-0.18|
|stock shareholders of Company after||||
|deducting of non-recurring gain/loss.||||

Shenzhen Textile (Holdings) Co., Ltd.
March 29, 2016