KONKA GROUP CO., LTD.
2015 SEMI-ANNUAL REPORT
2015-56
August 2015
2015Semi-annualReportofKonkaGroupCo.,Ltd. Section I. Important Reminders, Contents& Definitions
The Board of Directors, the Supervisory Committee as well as all directors, supervisors and senior management staff of Konka Group Co., Ltd. (hereinafter referred to as “the Company”) warrant that this report is factual, accurate and complete without any false record, misleading statement or material omission.And they shall bejointlyand severally liableforthat.
All directors attended theboard meeting for reviewing this report.
TheCompany’s profit distribution preplan upon the review and approval of the Fourth Meeting of the Eighth Board of Directors: Based on the total 1,203,972,704 shares of the Company as at 30 June 2015, 10 shares will be increased, with the capital reserves, to all shareholders for every 10 shares they hold. Nocash dividends orbonus shares will begranted.
Liu Fengxi, company principal, and Xu Youshan, chief of the accounting work and the accounting organ (chief of accounting), hereby confirm that the Financial Report enclosed in this report is factual, accurate and complete.
This report is prepared in both Chinese and English. Should there be any discrepancy between the two versions, the Chineseversion shall prevail.
2015Semi-annualReportofKonkaGroupCo.,Ltd. Contents
2015Semi-annualReport..................................................................................................................1 Section I. Important Reminders, Contents&Definitions..............................................................2 Section II. Company Profile..............................................................................................................7 Section III. Highlights ofAccounting Data&FinancialIndicators............................................10 Section IV.Report oftheBoard ofDirectors.................................................................................13 SectionV.SignificantEvents...........................................................................................................23 SectionVI.ChangesinShares&Particulars aboutShareholders..............................................38 SectionVII. Preference Shares........................................................................................................42 SectionVIII.Directors, Supervisors&SeniorManagementStaff..............................................43 Section IX. Financial Report...........................................................................................................47 Section X. DocumentsAvailableforReference............................................................................206
2015Semi-annualReportofKonkaGroupCo.,Ltd. Definitions
||||
|-|-|-|
|Term|Refersto|Definition|
|Company,theCompany,theGroup|Refersto|KonkaGroupCo.,Ltd.|
|TelecommunicationTechnology|Refersto|ShenzhenKonkaTelecommunicationsTechnologyCo.,Ltd.|
|Video&CommunicationSystemsEngineering|Refersto|ShenzhenKonkaVideo&CommunicationSystemsEngineeringCo.,Ltd.|
|PrecisionMold|Refersto|ShenzhenKonkaPrecisionMoldManufacturingCo.,Ltd.|
|KonkaHouseholdAppliances|Refersto|ShenzhenKonkaHouseholdAppliancesCo.,Ltd.|
|InformationNetwork|Refersto|ShenzhenKonkaInformationNetworkCo.,Ltd.|
|PlasticProducts|Refersto|ShenzhenKonkaPlasticProductsCo.,Ltd.|
|ElectricalAppliances|Refersto|ShenzhenKonkaElectricalAppliancesCo.,Ltd.|
|FittingsTechnology|Refersto|ShenzhenKonkaElectronicFittingsTechnologyCo.,Ltd.|
|MudanjiangAppliances|Refersto|MudanjiangArcticOceanAppliancesCo.,Ltd.|
|ShanxiKonka|Refersto|ShanxiKonkaElectronicCo.,Ltd.|
|ChongqingKonka|Refersto|ChongqingKonkaElectronicCo.,Ltd.|
|ChongqingElectronic|Refersto|ChongqingKonkaAutomotiveElectronicCo.,Ltd.|
|ChongqingQingjia|Refersto|ChongqingQingjiaElectronicsCo.,Ltd.|
|AnhuiKonka|Refersto|AnhuiKonkaElectronicCo.,Ltd.|
|AnhuiHouseholdAppliances|Refersto|AnhuiKonkaHouseholdAppliancesCo.,Ltd.|
|ChangshuKonka|Refersto|ChangshuKonkaElectronicCo.,Ltd.|
|KunshanKonka|Refersto|KunshanKonkaElectronicCo.,Ltd.|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||
|-|-|-|
|DongguanKonka|Refersto|DongguanKonkaElectronicCo.,Ltd.|
|DongguanPacking|Refersto|DongguanKonkaPackingMaterialsCo.,Ltd.|
|DongguanMouldPlastic|Refersto|DongguanKonkaMouldPlasticCo.,Ltd.|
|BoluoKonka|Refersto|BoluoKonkaPCBCo.,Ltd.|
|BoluoPrecision|Refersto|BoluoKonkaPrecisionTechnologyCo.,Ltd.|
|NanhaiInstitute|Refersto|Konka(Nanhai)DevelopmentCenter|
|HongKongKonka|Refersto|HongKongKonkaCo.,Ltd.|
|KonkaHouseholdAppliancesInvestment|Refersto|KonkaHouseholdAppliancesInvestment&DevelopmentCo.,Ltd.|
|Konka Household Appliances InternationalTrading|Refersto|KonkaHouseholdAppliancesInternationalTradingCo.,Ltd.|
|KonkaAmerica|Refersto|KonkaAmerica,Inc.|
|KonkaEurope|Refersto|Konka(Europe)Co.,Ltd.|
|Xutongda|Refersto|DongguanXutongdaMouldPlasticCo.,Ltd.|
|KonkaOptoelectronic|Refersto|ShenzhenKonkaOptoelectronicTechnologyCo.,Ltd.|
|Wankaida|Refersto|ShenzhenWankaidaScienceandTechnologyCo.,Ltd.|
|KunshanKangsheng|Refersto|KunshanKangshengInvestmentDevelopmentCo.,Ltd.|
|AnhuiTongchuang|Refersto|AnhuiKonkaTongchuangHouseholdAppliancesCo.,Ltd.|
|IndonesiaKonka|Refersto|IndonesiaKonkaElectronicsCo.,Ltd.|
|ShushidaLogistics|Refersto|ShenzhenShushidaLogisticsServiceCo.,Ltd.|
|BeijingKonkaElectronic|Refersto|BeijingKonkaElectronicCo.,Ltd.|
|KunshanJielunte|Refersto|KunshanJielunteMouldPlasticCo.,Ltd.|
|WuhanJielunte|Refersto|WuhanJielunteMouldPlasticCo.,Ltd.|
|ChuzhouJielunte|Refersto|ChuzhouJielunteMouldPlasticCo.,Ltd.|
|KonkaE-display|Refers|ShenzhenKonkaE-displayCo.,Ltd.|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
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|-|-|-|
||to||
|XiamenDalong|Refersto|XiamenDalongTradingCo.,Ltd.|
|YoushiKangrong|Refersto|YoushiKangrongCultureCommunicationCo.,Ltd.|
|AnhuiJiasen|Refersto|AnhuiJiasenPrecisionTechnologyCo.,Ltd.|
|KangqiaoJiacheng|Refersto|ShenzhenKangqiaoJiachengPropertyInvestmentCo.,Ltd.|
|KonkaSmartTech|Refersto|KonkaSmartTechLimited|
|KaikaiShijie|Refersto|AnhuiKaikaiShijieE-commerceCo.,Ltd.|
|E2info|Refersto|ShenzhenE2infoNetworkTechnologyCo.,Ltd.|
|CSRC|Refersto|ChinaSecuritiesRegulationCommission|
|SZSE|Refersto|ShenzhenStockExchange|
|CSRCShenzhenBureau|Refersto|ShenzhenBureauofChinaSecuritiesRegulationCommission|
|Yuan, Ten thousand Yuan, One HundredMillionYuan|Refersto|RMBYuan,RMBTenthousand,RMBOneHundredMillionYuan|

2015Semi-annualReportofKonkaGroupCo.,Ltd. Section II. Company Profile
I.Basicinformation ofthe Company
|||||
|-|-|-|-|
|Stockabbreviation|SKJA,SKJB|Stockcode|000016,200016|
|Stock abbreviation afterchange(ifany)|None|||
|Stockexchangelistedwith|ShenzhenStockExchange|||
|ChinesenameoftheCompany|康佳集团股份有限公司|||
|Abbr. of the Chinese name oftheCompany(ifany)|康佳集团|||
|EnglishnameoftheCompany(ifany)|KONKAGROUPCO.,LTD|||
|Abbr.oftheEnglishnameoftheCompany(ifany)|KONKAGROUP|||
|Legal representative of theCompany|LiuFengxi|||

II. Contact information
|||
|-|-|
||CompanySecretary|
|Name|WuYongjun|
|Contactaddress|BoardSecretariat,24/F,KonkaR&DCenter,28KejiSouthTwelfthRoad,ScienceandTechnology Park, Yuehai Street, Nanshan District, Shenzhen, Guangdong Province,China|
|Tel.|0755-26608866|
|Fax|0755-26600082|
|E-mail|szkonka@konka.com|

III. Other information
1.Ways to contactthe Company
Did any change occur to the registered address, office address and their postal codes, website address and email address oftheCompany during thereporting period?
√Applicable□ Inapplicable
|||
|-|-|
|RegisteredaddressoftheCompany|15-24/F, Konka R&D Center, 28 Keji South Twelfth Road, Science andTechnology Park, Yuehai Street, Nanshan District, Shenzhen, GuangdongProvince,China|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
|||
|-|-|
|Zipcode|518057|
|OfficeaddressoftheCompany|15-24/F, Konka R&D Center, 28 Keji South Twelfth Road, Science andTechnology Park, Yuehai Street, Nanshan District, Shenzhen, GuangdongProvince,China|
|Zipcode|518057|
|InternetwebsiteoftheCompany|www.konka.com|
|EmailaddressoftheCompany|szkonka@konka.com|
|Date of the disclosure of the relevantannouncementonthedesignatedwebsite(ifany)|14April2015|
|Website link for the relevant announcementdisclosedonthedesignatedwebsite(ifany)|http://www.cninfo.com.cn/finalpage/2015-04-14/1200825769.PDF|

2.Aboutinformation disclosureandwhere this report is placed
Did any change occur to information disclosure media and where this report is placed during the reporting period?
√Applicable□ Inapplicable
|||
|-|-|
|Newspapers designated by the Company forinformationdisclosure|SecuritiesTimes,etc.|
|InternetwebsitedesignatedbyCSRC for disclosingthisreport|www.cninfo.com.cn|
|Wherethisreportisplaced|Board Secretariat, 24/F, Konka R&D Center, 28 Keji South Twelfth Road,Science and Technology Park, Yuehai Street, Nanshan District, Shenzhen,GuangdongProvince,China|
|Dateofthedisclosureoftherelevantannouncementonthedesignatedwebsite(ifany)|14April2015|
|Website link for the relevant announcementdisclosedonthedesignatedwebsite(ifany)|http://www.cninfo.com.cn/finalpage/2015-04-14/1200825769.PDF|

3.Changes inthe registered information
Did any change occur to theregistered information during the reporting period?
√Applicable□ Inapplicable
|||||||
|-|-|-|-|-|-|
||Registrationdate|Registrationplace|BusinesslicenseNo.|Registrationcodeoftaxation|Organizationalcode|
|At the beginning of thereportingperiod|1October2011|Overseas ChineseTown, NanshanDistrict, Shenzhen,Guangdong|440301501121863|440301618815578|618815578|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
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|-|-|-|-|-|-|
|||Province,China||||
|At the end of the reportingperiod|1July2015|15-24/F, KonkaR&D Center, 28Keji SouthTwelfthRoad, Science andTechnology Park,Yuehai Street,Nanshan District,Shenzhen,GuangdongProvince,China|440301501121863|440301618815578|618815578|
|Date of the disclosure of therelevant announcement on thedesignatedwebsite(ifany)|14April2015|||||
|Website link for the relevantannouncement disclosed onthedesignatedwebsite(ifany)|http://www.cninfo.com.cn/finalpage/2015-04-14/1200825769.PDF|||||

2015Semi-annualReportofKonkaGroupCo.,Ltd. Section III. Highlights of Accounting Data& Financial Indicators I.Major accounting data andfinancialindicators
Does theCompany adjust retrospectively orrestate accounting dataof previous years due tochange ofany accounting policy orcorrection ofany accounting error?
□Yes√No
|||||
|-|-|-|-|
||Reportingperiod|Sameperiodoflastyear|YoY+/-(%)|
|Operatingrevenues(RMBYuan)|8,944,558,920.96|8,390,067,695.48|6.61%|
|Net profit attributable to shareholders oftheCompany(RMBYuan)|-296,953,507.39|44,394,585.84|-768.90%|
|Net profit attributable to shareholders oftheCompany after extraordinarygainsandlosses(RMBYuan)|-333,938,231.98|-172,899,104.31|-93.14%|
|Net cash flows from operating activities(RMBYuan)|70,042,909.63|1,207,928,081.12|-94.20%|
|BasicEPS(RMBYuan/share)|-0.25|0.04|-725.00%|
|DilutedEPS(RMBYuan/share)|-0.25|0.04|-725.00%|
|WeightedaverageROE(%)|-7.52%|1.11%|-8.63%|
||Asattheendofthereportingperiod|Asattheendoflastyear|+/-(%)|
|Totalassets(RMBYuan)|16,132,799,097.22|16,779,359,276.65|-3.85%|
|Net assets attributable to shareholders oftheCompany(RMBYuan)|3,797,724,449.84|4,103,478,971.07|-7.45%|

II. Differences between accounting data underdomestic andoverseas accounting standards 1. Differences of net profit and net assets disclosed in financial reports prepared under international andChineseaccounting standards
□Applicable√ Inapplicable
No difference.
2. Differences of net profit and net assets disclosed in financial reports prepared under overseas and Chineseaccounting standards
□Applicable√ Inapplicable
No difference.
2015Semi-annualReportofKonkaGroupCo.,Ltd. III. Items andamounts ofextraordinary gainsandlosses
√Applicable□Inapplicable
Unit:RMBYuan
||||
|-|-|-|
|Item|Amount|Explanation|
|Gains/losses on the disposal of non-current assets (including theoffsetpartoftheassetimpairmentprovisions)|-1,192,849.90||
|Government grants recognized in the current period, except forthose acquired in the ordinary course of business or granted atcertain quotas or amounts according to the government’s unifiedstandards|27,769,533.09||
|Gain/loss on entrusting others with investments or assetmanagement|3,442,481.04||
|Gains and losses on change in fair value from tradable financialassets and tradable financial liabilities, as well as investmentincome from disposal of tradable financial assets and tradablefinancial liabilities and financial assets available for sales exceptfor effective hedging related with normal businesses of theCompany|2,153,880.21||
|Gain/lossonentrustmentloans|1,669,999.98||
|Non-operatingincomeandexpenseotherthantheabove|5,493,353.06||
|Other gain and loss items that meet the definition of anextraordinarygain/loss|4,936,419.75||
|Less:Incometaxeffects|6,314,708.35||
|Minorityinterestseffects(aftertax)|973,384.29||
|Total|36,984,724.59|--|

Explain the reasons if the Company classifies an item as an extraordinary gain/loss according to the definition in the Explanatory Announcement No. 1 on Information Disclosure for Companies Offering Their Securities to thePublic—Extraordinary Gains and Losses, or classifies any extraordinary gain/loss item mentioned in the said explanatory announcement as a recurrent gain/loss item
√Applicable□ Inapplicable
||||
|-|-|-|
|Item|Amountinvolved(RMBYuan)|Reason|
|Taxrebatesonsoftware|34,130,823.15|GovernmentgrantscloselyrelatedtotheCompany’snormaloperationand constantly given at certain quotas or amounts according to thegovernment’spoliciesandstandards|
|Total|34,130,823.15||

2015Semi-annualReportofKonkaGroupCo.,Ltd. Section IV. Report of the Board of Directors
I.Overview
The Company specializes in production and operation of color TVs, digital mobile phones, consumer appliances, set-top boxes, LED products as well as the supporting products (such as molds, injection, packages, etc), and belongs to the industries of electronics manufacture and telecommunication equipment manufacture.
In the reporting period, we carried on with our Internet strategy and our product mix improved with a larger proportion ofsmart TVs inour totalsales.
(I) In the reporting period, the proportions of smart TVs and large-screen TVs in our total sales rose steadily, and theactivated smart TVrate also increased considerably.
In the reporting period, we launched a series of smart TVs. Joining hands with Tencent, Youku and Aliyun.com, we launched three majorseries—T60 Tencent Super TV, 2600 Youku TV and Aliyun TV for online sales. In addition, we also introduced to the market quality series including X80U Moon Goddess 4K Curved-Surface TV and 8900 TV. In the meantime, we started to cooperate with GITV and Tencent Video, marking theincrease ofour Internet TV partners toa numberof three. (II) In terms of our consumer appliance business, we adjusted our sales structure by promoting the sales of three-door, multi-door and side-by-side combination refrigerators and achieved a fast development with e-commerce channels by making the development of e-commerce a priority. As a result, boththe sales volumeand profitability ofourconsumer appliance business improved. (III) As for export, we successfully attracted new customers in Latin America, the Asia-Pacific region, etc., which boosted ouroverseas sales.
However, due to the fierce price competition of our main products, the profitability in our main business saw a drop in the reporting period. In addition, our gains and losses on disposal of non-current assets were RMB 259 million in the first half of 2014, which were mainly the investment gain on transferring Shenzhen Konka Video& Communication Systems Engineering Co., Ltd., while the first half of 2015 did not see such large-amount non-recurring gains. All these caused a large drop in the net profits attributable to the shareholders of the Company for the first half of2015.
For the reporting period, the Company achieved operating revenues of RMB 8.945 billion, up6.61% over the same period of last year; net profits attributable to the shareholders of the Company ofRMB -296.95million, down768.90% ontheyear-on-year basis;and EPSofRMB -0.25/share. II. Main business analysis
YoYmovements in majorfinancial data:
Unit:RMBYuan
2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||||
|-|-|-|-|-|
||Reportingperiod|Sameperiodoflastyear|YoY+/-%|Mainreasonsformovement|
|Operatingrevenues|8,944,558,920.96|8,390,067,695.48|6.61%||
|Operatingcosts|7,791,215,800.57|7,003,790,313.05|11.24%||
|Sellingexpenses|1,124,688,950.35|1,155,868,360.85|-2.70%||
|Administrativeexpenses|292,238,903.71|304,442,442.38|-4.01%||
|Financialexpenses|99,066,911.17|101,860,777.24|-2.74%||
|Incometaxexpenses|-51,101,619.20|35,514,884.35|-243.89%|Recognizedintheperioddeferredtaxincreasesresultinreducedincometaxexpenses|
|R&Dinputs|104,617,216.07|104,169,480.26|0.43%||
|Net cash flows fromoperatingactivities|70,042,909.63|1,207,928,081.12|-94.20%|Cashpaidforpurchaseofgoodsandserviceswiththegrowth|
|Net cash flows frominvestingactivities|326,173,576.74|-779,118,652.95|141.86%|Theperiodtorecoverpaymentofpremiumof488millionYuanlastyear|
|Net cash flows fromfinancingactivities|37,779,744.97|-579,139,400.35|106.52%|Borrowthecashreceivedforthecurrentperiodincreased|
|Net increase in cash andcashequivalents|396,244,280.00|-139,437,747.49|384.17%||

Major changes to theprofit structure orsources ofthe Companyduring the reporting period:√Applicable□ Inapplicable
Due to the fierce price competition of our main products, the profitability in our main business saw a drop in the reporting period. In addition, our gains and losses on disposal of non-current assets were RMB 259 million in the first half of 2014, which were mainly the investment gain on transferring Shenzhen Konka Video& Communication Systems Engineering Co., Ltd., while the first half of 2015 did not see such large-amount non-recurring gains.All these caused a large drop in the net profits attributableto theshareholders of theCompany forthe firsthalf of2015.
Reporting period progress of the future development planning in the disclosed documents of the Company such as share-soliciting prospectuses, offering prospectuses, asset reorganization reports, etc.:
□Applicable√ Inapplicable
The Company did not mention any future planning for the reporting period in its disclosed
documents such as share-soliciting prospectuses, offering prospectuses, asset reorganization reports,
etc.
Review theprogress ofanypreviously disclosed business plan in thereporting period:
2015Semi-annualReportofKonkaGroupCo.,Ltd. During the reporting period, adhering to our annual operational plan, we overcame difficulties and steadily pushed forward all our operational and management tasks. In the reporting period, we carried on with our Internet strategy and our product mix improved with a larger proportion of smart TVs in our total sales. The sales incomes from our consumer appliance business and overseas business both increased. However, due to the fierce price competition of our main products, the sales income from our color TV business saw a drop, which brought down our main business income andprofits in thereporting period. For moredetails, seethe“Overview”section above. III. Breakdown ofmain business
Unit:RMBYuan
|||||||||
|-|-|-|-|-|-|-|-|
||Operatingrevenue||Operatingcost|Grossprofitrate(%)|Increase/decreaseofoperatingrevenueoverthesameperiodoflastyear(%)|Increase/decreaseofoperatingcostoverthesameperiodoflastyear(%)|Increase/decreaseofgrossprofitrateoverthesameperiodoflastyear(%)|
|Classifiedbyindustry:||||||||
|Electronic|8,246,299,638.18||7,161,672,404.62|13.15%|-0.44%|3.07%|-2.96%|
|Total|8,246,299,638.18||7,161,672,404.62|13.15%|-0.44%|3.07%|-2.96%|
|Classifiedbyproduct:||||||||
|ColorTVs|5,839,273,101.30|4,998,980,729.53||14.39%|-5.35%|-1.57%|-3.29%|
|Cellphones|405,882,081.01|394,112,904.23||2.90%|-47.47%|-44.60%|-5.02%|
|Customerappliances|828,393,555.30|650,002,713.45||21.53%|4.76%|2.36%|1.84%|
|Other|1,172,750,900.57|1,118,576,057.41||4.62%|113.25%|113.76%|-0.23%|
|Total|8,246,299,638.18|7,161,672,404.62||13.15%|-0.44%|3.07%|-2.96%|
|Classifiedbyregion:||||||||
|Domestic|4,807,213,043.19|3,897,064,692.75||18.93%|-18.77%|-18.29%|-0.48%|
|Overseas|3,439,086,594.99|3,264,607,711.87||5.07%|45.44%|49.84%|-2.79%|
|Total|8,246,299,638.18|7,161,672,404.62||13.15%|-0.44%|3.07%|-2.96%|

 IV.Core competitiveness analysis
TheCompany’s capability inR&D, the marketing network and manufacture constitutes its competitive edges. Through resource integration, the Company will vigorously try to make substantial breakthroughs in intelligent products, cloud computing, application of the internet technology, application software, etc.. It will also try to enhance the strength and thickness of technical innovations toincrease its overall competitiveness.
2015Semi-annualReportofKonkaGroupCo.,Ltd. V. Investmentanalysis
1.Investments inequities ofexternal parties
(1) Investments in external parties
√Applicable□ Inapplicable
||||
|-|-|-|
|Investmentsinexternalparties|||
|Investmentamountinthereportingperiod(RMBYuan)|Investmentamountinthesameperiodoflastyear(RMBYuan)|+/-%|
|66,835,410.00|7,723,300.00|765.37%|
|Particularsaboutinvestees|||
|Nameofinvestee|Mainbusiness|ProportionoftheCompany’sinvestmentintheinvestee’stotalequityinterests(%)|
|HunanVaryTechCo.,Ltd.|Solidwasteandotherwasterecycling,etc.|10.40%|
|ShenzhenNobelEducationInvestmentandDevelopmentCo.,Ltd.|Educationprojectinvestment,etc.|14.76%|
|ZhuhaiJinsuPlasticCo.,Ltd.|Modifiedplastics,etc.|20.70%|
|Shenzhen Qianhai Qingsong VentureCapitalFundCo.,Ltd.|Equityinvestment|6.00%|

(2) Equity-holdingsin financialenterprises
□Applicable√ Inapplicable
No such cases in thereporting period.
(3) Securities investments
√ Applicable□Inapplicable
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
|Varietyofsecurities|Codeofsecurities|Nameofsecurities|Initialinvestmentcost(RMBYuan)|Numberofsharesheldatperiod-begin|Shareholdingpercentageatperiod-begin|Numberofsharesheldatperiod-end|Shareholdingpercentageatperiod-end|Closingbookvalue(RMBYuan)|Gain/lossforreportingperiod(RMBYuan)|Accountingtitle|Sourceofstock|
|Stock|002772|ZXRY|6,500.00|0|0.00%|500|0.00%|11,325.00|4,825.00|Available-for-salefinancialassets|Applicationfor thenewshares|
|Stock|300485|SSYY|19,230.00|0|0.00%|500|0.00%|33,500.00|14,275.00|Available-for-salefinancialassets|Applicationfor thenewshares|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
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|-|-|-|-|-|-|-|-|-|-|-|-|
|Stock|300481|PYHC|4,565.00|0|0.00%|500|0.00%|6,575.00|2,010.00|Available-for-salefinancialassets|Applicationfor thenewshares|
|Stock|002770|KDRY|3,425.00|0|0.00%|500|0.00%|4,930.00|1,505.00|Available-for-salefinancialassets|Applicationfor thenewshares|
|Stock|002776|BBL|11,645.00|0|0.00%|500|0.00%|20,290.00|8,645.00|Available-for-salefinancialassets|Applicationfor thenewshares|
|Stock|002766|SLGF|3,765.00|0|0.00%|500|0.00%|17,005.00|13,240.00|Available-for-salefinancialassets|Applicationfor thenewshares|
|Other securities investmentheldattheperiod-end|||0.00|0|--|0|--|0.00|0.00|--|--|
|Total|||49,130.00|0|--|3,000|--|93,625.00|44,500.00|--|--|
|Disclosure date of the boardannouncement on approval ofthesecuritiesinvestment|||Inapplicable|||||||||
|Disclosure dateof thegeneralmeeting announcement onapproval of the securitiesinvestment(ifany)|||Inapplicable|||||||||

(4) Shareholdingsin otherlisted companies
√Applicable□ Inapplicable
At the period-end, the Company held the common shares ofVankeAwith the initial investment cost of RMB 2,311,748.07 and the fair value at the period-begin of RMB 1,630,609.00, the fair value at the period-end should be calculated and recognized ofRMB1,703,341.20.
2.Wealth management entrustment, derivative investments andentrustment loans
(1) Wealth management entrustment
√ Applicable□Inapplicable
Unit: RMB Ten Thousand Yuan
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
|Trusteename|Associaterelations|Relatedpartytransactio|Producttype|Financialamount|Startdate|Terminationdate|Paydetermination|Theactualprincipal|Provisionforimpairme|Expectedbenefits|AmountofProfit/los|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
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|-|-|-|-|-|-|-|-|-|-|-|-|
|||ns||||||amount|ntamount(ifany)||softhereportingperiod|
|BankMudanjiangbranch|No|No|Shorttermfinance|100|30,June2015|25,August 2015|Guarant|100|0|0.56|0.56|
||||||||eedprin|||||
||||||||cipal|||||
||||||||and int|||||
||||||||erest|||||
|Total||||100|--|--|--|100|0|0.56|0.56|
|Financialsources||||Ownfunds||||||||
|Failstorecoverthecumulativeamountofprincipalandearnings||||0||||||||
|Involved(ifapplicable)||||Inapplicable||||||||
|EntrusttheapprovaldisclosuredatefortheannouncementoftheBoard(ifany)||||24,May2014||||||||
|Entrustapprovalannouncementdateofdisclosureofshareholders(ifany)||||Inapplicable||||||||

(2) Derivative investments
□Applicable√ Inapplicable
No such cases in thereporting period.
(3) Entrustmentloans
√ Applicable□Inapplicable
Unit: RMB Ten Thousand Yuan
|||||||
|-|-|-|-|-|-|
|Borrower|Relatedpartyornot|Amountofloan|Interestrate|Guarantororpawn|Usageofloanbyborrower|
|Chuzhou Tongchuang Construction Investment Co.,Ltd.|No|5,000||ChuzhouEconomicTechnologyDevelopmentCorporation|Purchase of theconstructionmaterials|
|Total|--|5,000|--|--|--|
|Expanded,overdueperiodorlawsuitsevents(ifany)|Inapplicable|||||
|Solutions of expanded, overdue period or lawsuitsevents(ifany)|Inapplicable|||||
|Disclosure date of the board announcementapprovingtheentrustmentloans(ifany)|Inapplicable|||||

2015Semi-annualReportofKonkaGroupCo.,Ltd.
|||
|-|-|
|Disclosure date of the general meetingannouncement approving the entrustment loans (ifany)|Inapplicable|

3.Use ofraised funds
□Applicable√ Inapplicable
No such cases in thereporting period.
4.Analysisto main subsidiaries andstock-participating companies
√ Applicable□Inapplicable
Particulars about main subsidiaries and stock-participating companies:
Unit:RMBYuan
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
|Companyname|Companyvariety|Industry|Mainproducts/services|Registeredcapital|Totalassets|Netassets|Operatingrevenues|Operatingprofit|Netprofit|
|ShenzhenWankaidaScience andTechnologyCo.,Ltd.|Subsidiary|Softwaredevelopment|Developmentandmaintenanceofsoftwaretechnology|RMB10000000|325,286,855.14|322,097,576.79|36,178,080.00|18,365,880.14|21,771,380.93|
|DongguanCityXuTongdaMouldPlasticCo.,Ltd.|Subsidiary|Manufacture|Productionandsaleofmouldandplasticproducts|RMB5000000|82,696,941.43|29,434,604.59|84,103,163.49|8,529,549.21|7,240,416.80|
|ShenzhenKonkaInformationNetworkCo.,Ltd.|Subsidiary|Manufacture|Productionand sale ofdigitalnetworkproducts|RMB30000000|147,603,003.22|652,045.90|99,506,009.01|2,984,000.32|4,191,814.58|
|AnhuiKonkaTongchuangHouseholdAppliancesCo.,Ltd.|Subsidiary|Manufacture|Productionand sale ofrefrigerators, washingmachinesand otherhouseholdappliances|RMB180000000|1,022,368,569.91|-12,788,506.35|768,107,346.13|1,793,529.37|1,513,697.38|
|AnhuiKonkaElectronic|Subsidiary|Manufacture|Productionand sale ofmultimediaproducts|RMB140000000|1,298,815,352.05|269,668,296.82|2,428,514,346.89|-17,702,359.71|-11,901,124.74|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
|Co.,Ltd.||||||||||
|DongguanKonkaMouldPlasticCo.,Ltd.|Subsidiary|Manufacture|Productionandsaleofmouldandplasticproducts|RMB10000000|293,766,111.61|114,280,816.46|82,998,859.63|-9,735,442.37|-8,221,585.52|
|EnRayTekOptoelectronics(Shanghai)Co.,Ltd.|Jointstockcompany|Manufacture|ProductionandsaleofLED|USD50000000|875,265,958.44|640,134,316.09|410,435,854.56|-52618094.68|20,881,774.05|
|ShenzhenKonkaTelecommunicationsTechnologyCo.,Ltd.|Subsidiary|Manufacture|Productionand sale ofmobilecommunicationproducts &sale ofmultimediaproducts|RMB120000000|317,656,816.35|-204,020,492.13|370,547,236.64|-14,379,933.02|-4,771,454.21|
|KunshanKonkaElectronicCo.,Ltd.|Subsidiary|Manufacture|ProductionandsaleofTFT-LCMandmultimediaproducts|RMB350000000|634,703,195.12|340,956,607.91|789,554,198.22|-22,234,082.10|-19,145,674.95|
|DongguanKonkaElectronicCo.,Ltd.|Subsidiary|Manufacture|Productionandsaleofmultimediaproducts|RMB266670000|834,505,119.30|550,372,816.91|500,896,789.28|-42,825,749.56|-33,149,905.02|
|HongKongKonkaCo.,Ltd.|Subsidiary|Internationaltrade|Export & import of electromechanical and electronics|HKD500000|2,631,427,077.20|61,802,269.30|1,700,208,001.07|-52,621,630.87|-53,437,493.49|

5.Significantprojects invested with non-raised funds
√Applicable□ Inapplicable
Unit:RMBTenThousandYuan
|||||||||
|-|-|-|-|-|-|-|-|
|Projectname|Totalplanedinvestment|Inputforthisperiod|Cumulativeactualinputasattheperiod-end|Projectprogress|Projectearnings|Disclosuredate(ifany)|Disclosureindex(ifany)|
|Kunshan|200,000|12,517|90,325|45.2%|PhaseI|Inapplicable|Inapplicable|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
|||||||||
|-|-|-|-|-|-|-|-|
|ShuiyueZhouzhuangProject|||||dwellinghousescompleted,PhaseIIdwellinghousesunderconstructionAnincomeofRMB40.5679millionforthereportingperiod,representingadeficitofRMB14.3834million|||
|UrbanrenewalprojectsoftheheadquartersfactoryofKonkaGroup|496,000|5,601|5,601|1.1%|Planningandadvisoryagencyhiredthroughbidding.Currentlyincoordinationtodismantleoldplants,etc.Thereportingperiodsawnoincome.|Inapplicable|Inapplicable|

VI.Predict theoperating results ofJan.-Sept. 2015
Warning of possible loss or considerableYoYchange of the accumulated net profit made during the period-begin to the end of the next reporting period according to prediction, as well as explanations onthe reasons:
□Applicable√ Inapplicable
VII. Explanation by the Board of Directors and the Supervisory Committee about the “non-standard auditreport”issued by theCPAs firmforthereporting period
□Applicable√ Inapplicable
2015Semi-annualReportofKonkaGroupCo.,Ltd. VIII. Explanation by the Board of Directors about the “non-standard audit report” for last year
□Applicable√ Inapplicable
IX.Implementation ofprofitallocationduringthereporting period
Profit allocation plan implemented during the reporting period, especially execution and adjustment ofthe cash dividend plan and theplan for turning capital reserve intoshare capital:
√Applicable□ Inapplicable
As reviewed at the 2014AnnualShareholders’General Meeting, the profit allocation plan for 2014 was decided as follows:
Dividend distribution plan: Based on theCompany’s total share capital of 1,203,972,704 shares as at the end of 2014, the Company distributed a cash dividend of RMB 0.1 (tax included) to every 10 shares. The distributed profits aggregated RMB 12,039,727.04 and the retained profit was carried forward intothe nextyear fordistribution.
The profit allocation plan has been carried out. For A-shares, the date of record was 17 Jul. 2015 and the ex-dividend date was 20 Jul. 2015; for B-shares, the last trading date was 17 Jul. 2015, the ex-dividend date was 20Jul. 2015and thedate ofrecord was 22Jul.2015.
|||
|-|-|
|Specialstatementaboutthecashdividendpolicy||
|In compliance with the Company’s Articles of Association andtheresolutionofthegeneralmeeting:|Yes|
|Specificandcleardividendstandardandratio:|Yes|
|Completedecision-makingprocedureandmechanism:|Yes|
|Independent directors fulfilled their responsibilities and playedtheirduerole:|Yes|
|Minority shareholders have the chance to fully express theiropinionand desireand theirlegal rightsandinterests were fullyprotected:|Yes|
|In adjustment or alteration of the cash dividend policy, theconditions and procedure were in compliance with regulationsandtransparent:|Yes|

X. Preplan for profit distribution and turning capital reserve into share capital in the reporting period
√Applicable□ Inapplicable
|||
|-|-|
|Bonussharesforevery10shares(share)|0|
|Dividend for every 10 shares (RMB Yuan) (tax|0.00|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
|||
|-|-|
|included)||
|Increasedsharesforevery10shares(share)|10|
|Totalsharesasthebasisfortheallocationpreplan(share)|1,203,972,704|
|Totalcashdividends(RMBYuan)(taxincluded)|0.00|
|Distributableprofit(RMBYuan)|0.00|
|Percentage of the cash dividends in the totaldistributedprofit(%)|0.00%|
|Cashdividendpolicy:||
|Other||
|Detailsaboutthepre-planforprofitallocationandturningcapitalreserveintosharecapital||
|Trough the review of the 4th Session of the 8th Board of Directors, based on the Company’s total share capital of 1,203,972,704sharesasat30Jun.2015,theCompanyturnedthecapitalreserveofevery10sharesintosharecapitalfor 10sharestothewholeshareholders,andthepreplanwasstillneededtobesubmittedtotheAnnualGeneralMeetingforreview.Theplanalsorequiredthecompanytoshareholders.||

XI.Researches, visits andinterviews received inthe reporting period
□Applicable√ Inapplicable
The Company was not involved in any activity of researches, visits and interviews in the reporting period.
Section V. Significant Events
I.Corporate governance
In the reporting period, in strict compliance with the Company Law, the Securities Law and other relevant laws, regulations and rules governing corporate governance of listed companies, as well as theCompany’s Articles of Association, the Company kept optimizing its corporate governance structure, promoted compliance with applicable laws and regulations in its operation, and performed the information disclosure duty strictly in accordance with the Stock Listing Rules of the Shenzhen Stock Exchange. All directors, supervisors and senior executives of the Company performed their duties diligently. TheShareholders’ General Meeting, the Board of Directors and the Supervisory Committee all operated in compliance with relevant laws and regulations. TheCompany’s existing internal control rules played the role of supervision, control and guidance effectively in its production and operation. Independence and transparency of the Company, together with a
professional board of directors, ensured that every decision of the Company was made in a
scientific procedure. The actual situation of theCompany’s governance was in compliance with the
2015Semi-annualReportofKonkaGroupCo.,Ltd. Company Law and therelevant CSRCrequirements.
II. Lawsuits
Significant litigations and arbitrations
□Applicable√ Inapplicable
There was noany significant litigation and arbitration oftheCompany in thereporting period. Other lawsuits
√Applicable□Inapplicable
Please referto notes to
|||||||||
|-|-|-|-|-|-|-|-|
|Basicinformationofthelawsuit(arbitration)|Amountinvolvedinthelawsuit(arbitration)(RMBTenthousand)|Formingtheestimatedliabilitiesornot?|Progressofthelawsuit(arbitration)|Trialresultandinfluenceofthelawsuit(arbitration)|Enforcementonthejudgmentofthelawsuit(arbitration)|Disclosuredate|Disclosureindex|
|thefinancial statements in the12th chapter ofcommitments and contingencies 2ndsummary or description of thematter.||||||||

III.Media’squeries
□Applicable√Inapplicable
There wasnomedia’s common query during thereporting period.
IV.Bankruptcy reorganization
□Applicable√ Inapplicable
No event involving bankruptcy reorganization occurred tothe Companyin thereporting period. V. Assettransactions
1.Purchase ofassets
□Applicable√ Inapplicable
There was nopurchase of assets bytheCompany during thereporting period.
2.Saleofassets
□Applicable√ Inapplicable
There was nosaleof assets bytheCompany during thereporting period.
2015Semi-annualReportofKonkaGroupCo.,Ltd. 3.Business combination
□Applicable√ Inapplicable
No businesscombination occurred to theCompany during thereporting period.
VI.Implementation ofequity incentiveandits influence
□Applicable√ Inapplicable
The Company did notmake orcarry out any equity incentiveplan during the reporting period. VII. Significantrelated-party transactions
1.Related-party transactions concerning routineoperation
√Applicable□ Inapplicable
|||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
|Relatedtransactionparty|Relation|Typeofthetransaction|Contentsofthetransaction|Pricingprinciple|Transactionprice|Transactionamount(RMBTenthousandYuan)|Proportioninthetotalamountsoftransactionsofthesamekind(%)|Methodofsettlement|Obtainablemarketpriceforthetransactionofthesamekind|Disclosuredate|Disclosureindex|Relatedtransactionparty|Relation|
|AnhuiHualiPackingCo.,Ltd.|Underthesameactualcontroller|Purchaseofcommodities|Purchaseofmaterials|Negotiatedprice|Marketprice|1,368.57|0.21%|4,000|No|Cash|N/A|3Apr.2015|http://www.cninfo.com.cn/finalpage/2015-04-03/1200782520.PDF|
|ShanghaiHualiPackingCo.,Ltd.|Underthesameactualcontroller|Purchaseofcommodities|Purchaseofmaterials|Negotiatedprice|Marketprice|531.37|0.08%|2,000|No|Cash|N/A|3Apr.2015|Sameasabove|
|HualiPacking(Huizhou)Co.,Ltd.|Underthesameactualcontroller|Purchaseofcommodities|Purchaseofmaterials|Negotiatedprice|Marketprice|506.21|0.08%|2,000|No|Cash|N/A|3Apr.2015|Sameasabove|
|Total||||--|--|2,406.15|--|8,000|--|--|--|--|--|
|Details of large amount of salesreturns||||Inapplicable||||||||||

2015Semi-annualReportofKonkaGroupCo.,Ltd.
|||
|-|-|
|As for the prediction on the totalamount of routine related-partytransactions to be occurred in thereporting period by relevant types,the actual performance in thereportingperiod(ifany)|The Company has published the Forecasting Public Notice on Routine Related Transactionfor Y2015 (public notice No. 2015-03) on Securities Times, Shanghai Securities News,China Securities Journal and Hong Kong Ta Kung Pao as well as the Internet websitedesignatedbyCSRChttp://www.cninfo.com.cn on3Apr.2015.In thereportingperiod,thebasis for pricing, transaction price, transaction amount and settlement methods of rawmaterials purchased by the Company were basically in accordance with the forecast. ThetotalamountwasRMB2,406.14million.|
|Reason for significant differencebetweenthetransactionpriceandthemarketprice|The transaction price was fixed by referring to the market price, which had not anysignificantdifferencewiththemarketprice.|

2.Related-party transactions arisingfromacquisitionandsaleof assets
□Applicable√ Inapplicable
There was noany related-party transaction arising from acquisition and saleofassets.
3.Related-party transactions arisingfromjointinvestment inexternal parties
√Applicable□ Inapplicable
||||||||||
|-|-|-|-|-|-|-|-|-|
|Jointinvestor|Relationship|Pricingprinciple|Nameofinvestee|Mainbusinessofinvestee|Registeredcapitalofinvestee|Totalassetsofinvestee(RMB0’000)|Netassetsofinvestee(RMB0’000)|Netprofitofinvestee(RMB0’000)|
|OCTEnterprisesCo. and theCompany|OCT is thecontrollingshareholderof theCompany.|Bothcontributedincash. TheCompanycontributedRMB 700million,representinga stake of70%; andOCTcontributedRMB 300million,representinga stake of30%.|ShenzhenKangqiaoJiachengRealEstateInvestmentCo.,Ltd.|Investment,developmentand operationof the realestateprojects inthe plant areaof the KonkaHeadquarters|RMB1billion|15,986.05|15,945.65|-54.35|
|Progress of any significantconstruction in process oftheinvestee(ifany)||According to the Proposal on the Cooperation Development Plan of the Urban Renewal Projects oftheHeadquartersFactoryofKonkaGroupwhichbereviewedandapprovedbythe2ndExtraordinaryGeneralMeetingheldon8Dec.2014bytheCompany,theCompanyandtheOCTGroupsetuptheShenzhen Kangqiao Jiacheng Real Estate Investment Co., Ltd. by joint capital . And recently theurban renewal projects of the original headquarters factory of Konka Group had completed the bidinviting of the planning consulting unit and is harmoniously promoting the dismantling work of the|||||||

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||
|-|
|oldplantareaandsoon.|

Notes: if had been disclosed on the interim report but there was on any progress or change of the follow-up execution, the section could select the “inapplicable”, while still needed to be summarized by disclosing on the other related transactions of notes 5 of the section and should provide therelevant index ofthe inquiryon theinterim report disclosure website.
4.Credits andliabilities with related parties
□Applicable√ Inapplicable
There was noany credit and liabilitywith related parties oftheCompany in thereporting period. 5.Other related-party transactions
√Applicable□ Inapplicable
Due to production and operation needs, we have planned to sell LCD to and purchase whole TVs from HuiKe Electronics (Shenzhen) Co., Ltd. (“HKC”). It is expected that during the period from 18 Jun. 2015 to 18 Jun. 2016, we will sell LCD to HKC under the amount of RMB 70 million and purchasewholeTVs from HKC under theamount ofRMB120million.
The related-party transactions between us and HKC amounted to RMB 0 during the reporting period.
For details, see theCompany’s announcement on expected routine related-party transactions disclosed onwww.cninfo.com.cn dated 29Jul. 2015.
||||
|-|-|-|
|Announcementtitle|Dateofdisclosure|Websiteofdisclosure|
|AnnouncementonExpectedRoutineRelated-PartyTransactions|29Jul.2015|www.cninfo.com.cn|

.
VIII. Occupation of theCompany’s funds for non-operating purposes by the controlling shareholderand its related parties
□Applicable√ Inapplicable
The controlling shareholder or its related parties did not occupy theCompany’s funds for non-operating purposes during thereporting period.
IX.Significant contracts andfulfillmentthereof
1.Trusteeship, contracting andleasing
(1) Trusteeship
□Applicable√ Inapplicable
The Company did notmake any entrustment in thereporting period.
(2) Contracting
□Applicable√ Inapplicable
The Company was not involved inany contracting in thereporting period.
2015Semi-annualReportofKonkaGroupCo.,Ltd. (3) Leasing
√Applicable□ Inapplicable
Particulars about lease: TheCompany’s Research and Development Building is rent with annual income ofRMB3315.35in thefirst half of2015.
Any leasing event incurring gain/loss reaching more than10% of the total profits of the Company in the reporting period
□Applicable√ Inapplicable
No leasing event incurred gain/loss reaching more than10% of the total profits of the Company in the reporting period.
2.Guarantees providedby theCompany
Unit:RMBTenThousandYuan
||||||||||
|-|-|-|-|-|-|-|-|-|
|Guaranteesprovidedbythecompanyforexternalparties(excludingthoseforsubsidiaries)|||||||||
|Guaranteedparty|Disclosuredateonrelevantannouncementofguaranteedamount|Amountforguarantee|Actualoccurrencedate(dateofagreement)|Actualguaranteeamount|Typeofguarantee|Periodofguarantee|Executedornot|Guaranteeforarelatedpartyornot|
|No|No|0|No|0||0|No|No|
|Total external guarantee lineapproved during the reportingperiod(A1)||0||Total actual occurred amountof external guarantee duringthereportingperiod(A2)||0|||
|Total external guarantee linethat has been approved at theendofthereportingperiod(A3)||0||Totalactual external guaranteebalance at the end of thereportingperiod(A4)||0|||
|GuaranteesprovidedbytheCompanyforitssubsidiaries|||||||||
|Guaranteedparty|Disclosuredateofrelevantannouncementontheguaranteeamount|Amountforguarantee|Actualoccurrencedate(dateofagreement)|Actualguaranteeamount|Typeofguarantee|Periodofguarantee|Executedornot|Guaranteeforarelatedpartyornot|
|Anhui KonkaElectronic Co.,Ltd.|21Nov.2014|20,000|26Dec.2014|7,761.57|Generalguaranty|1year|No|No|
|Anhui KonkaElectronic Co.,Ltd.|21Nov.2014|20,000|12Mar.2015|610.79|Generalguaranty|1year|No|No|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||||||||
|-|-|-|-|-|-|-|-|-|
|Anhui KonkaElectronic Co.,Ltd.|21Nov.2014|20,000|10Apr.2015|1,997.67|Generalguaranty|1year|No|No|
|Anhui KonkaElectronic Co.,Ltd.|21Nov.2014|20,000|14May2015|3,537.20|Generalguaranty|1year|No|No|
|Anhui KonkaElectronic Co.,Ltd.|21Nov.2014|20,000|19May2015|4,259.39|Generalguaranty|1year|No|No|
|Anhui KonkaTongchuangHouseholdAppliances Co.,Ltd.|21Nov.2014|30,000|30Jan.2015|8,000|Generalguaranty|1year|No|No|
|Anhui KonkaTongchuangHouseholdAppliances Co.,Ltd.|21Nov.2014|30,000|18Nov.2014|10,500|Generalguaranty|1year|No|No|
|Anhui KonkaTongchuangHouseholdAppliances Co.,Ltd.|21Nov.2014|30,000|2Jun.2015|2,000|Generalguaranty|1year|No|No|
|Kunshan KonkaElectronic Co.,Ltd.|21Nov.2014|30,000|26Dec.2014|5,214.15|Generalguaranty|1year|No|No|
|Shenzhen KonkaCommunicationtechnology Co.,Ltd.|21Nov.2014|60,000|22Apr.2015|50,000|Generalguaranty|1year|No|No|
|Shenzhen KonkaCommunicationtechnology Co.,Ltd.|21Nov.2014|60,000|28Jan.2015|10,000|Generalguaranty|1year|No|No|
|E-displayCommercialDisplayCo.,Ltd.|21Nov.2014|4,800|27Jan.2015|2,000|Generalguaranty|1year|No|No|
|Hong Kong KonkaCo.,Ltd.|30Sep.2013|307,500|10Oct.2014|6,110|Generalguaranty|1year|No|No|
|Hong Kong Konka|30Sep.|307,500|12Nov.2014|7,800|General|1year|No|No|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||||||||
|-|-|-|-|-|-|-|-|-|
|Co.,Ltd.|2013||||guaranty||||
|Hong Kong KonkaCo.,Ltd.|30Sep.2013|307,500|17Nov.2014|18,330|Generalguaranty|1year|No|No|
|Hong Kong KonkaCo.,Ltd.|30Sep.2013|307,500|20Nov.2014|27,495|Generalguaranty|1year|No|No|
|Hong Kong KonkaCo.,Ltd.|30Sep.2013|307,500|15Jan.2015|30,550|Generalguaranty|2years|No|No|
|Hong Kong KonkaCo.,Ltd.|30Sep.2013|307,500|28Jul.2014|42,220|Generalguaranty|2years|No|No|
|Hong Kong KonkaCo.,Ltd.|30Sep.2013|307,500|17Sep.2014|18,880|Generalguaranty|2years|No|No|
|Hong Kong KonkaCo.,Ltd.|30Sep.2013|307,500|23Mar.2015|15,092|Generalguaranty|1year|No|No|
|Hong Kong KonkaCo.,Ltd.|30Sep.2013|307,500|29May2015|15,458|Generalguaranty|1year|No|No|
|Hong Kong KonkaCo.,Ltd.|30Sep.2013|307,500|26Jan2015|24,440|Generalguaranty|1year|No|No|
|Hong Kong KonkaCo.,Ltd.|30Sep.2013|307,500|1Apr.2015|14,800|Generalguaranty|8months|No|No|
|Total guarantee line approvedfor the subsidiaries during thereportingperiod(B1)||0||Total actual occurred amountof guarantee for thesubsidiaries during thereportingperiod(B2)||152,195.05|||
|Total guarantee line that hasbeen approved for thesubsidiaries at the end of thereportingperiod(B3)||477,050||Total actual guarantee balancefor the subsidiaries at the endofthereportingperiod(B4)||327,055.77|||
|Guaranteesprovidedbythesubsidiariesforthesubsidiaries|||||||||
|Guaranteedparty|Disclosuredateofrelevantannouncementontheguaranteeamount|Amountforguarantee|Actualoccurrencedate(dateofagreement)|Actualguaranteeamount|Typeofguarantee|Periodofguarantee|Executedornot|Guaranteeforarelatedpartyornot|
|Dongguan KonkaMould Plastic Co.,Ltd.|27Apr.2013|4,631|6Feb.2015|234.79|Joint liabilityguaranty|6months|No|No|
|Dongguan KonkaMould Plastic Co.,|27Apr.2013|4,631|21Jan.2015|136.61|Joint liabilityguaranty|6months|No|No|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||||||||
|-|-|-|-|-|-|-|-|-|
|Ltd.|||||||||
|Dongguan KonkaMould Plastic Co.,Ltd.|27Apr.2013|4,631|10Feb.2015|263.97|Joint liabilityguaranty|6months|No|No|
|Dongguan KonkaMould Plastic Co.,Ltd.|27Apr.2013|4,631|16Mar.2015|200.99|Joint liabilityguaranty|6months|No|No|
|Dongguan KonkaMould Plastic Co.,Ltd.|27Apr.2013|4,631|1Apr.2015|84.28|Joint liabilityguaranty|6months|No|No|
|Dongguan KonkaMould Plastic Co.,Ltd.|27Apr.2013|4,631|21Apr.2015|137.08|Joint liabilityguaranty|6months|No|No|
|Dongguan KonkaMould Plastic Co.,Ltd.|27Apr.2013|4,631|18Jan.2015|132.91|Joint liabilityguaranty|6months|No|No|
|Dongguan KonkaMould Plastic Co.,Ltd.|27Apr.2013|4,631|16Jan.2015|163.94|Joint liabilityguaranty|6months|No|No|
|Kunshan GeraintMould Plastic Co.,Ltd.|29Sep.2013|23,155|21Jan.2014|361.22|Joint liabilityguaranty|2year|No|No|
|Kunshan GeraintMould Plastic Co.,Ltd.|29Sep.2013|23,155|28Nov.2014|78.73|Joint liabilityguaranty|1year|No|No|
|Kunshan GeraintMould Plastic Co.,Ltd.|29Sep.2013|23,155|8Dec.2014|60.20|Joint liabilityguaranty|1year|No|No|
|Kunshan GeraintMould Plastic Co.,Ltd.|29Sep.2013|23,155|3Dec.2014|213.03|Joint liabilityguaranty|1year|No|No|
|Kunshan GeraintMould Plastic Co.,Ltd.|29Sep.2013|23,155|12Feb.2015|32.42|Joint liabilityguaranty|1year|No|No|
|Kunshan GeraintMould Plastic Co.,Ltd.|29Sep.2013|23,155|5Feb.2015|245.44|Joint liabilityguaranty|1year|No|No|
|Total guarantee line approvedfor the subsidiaries during thereportingperiod(C1)||0||Total actual occurred amountof guarantee for thesubsidiaries during the||1,632.43|||

2015Semi-annualReportofKonkaGroupCo.,Ltd.
|||||
|-|-|-|-|
|||reportingperiod(C2)||
|Total guarantee line that hasbeen approved for thesubsidiaries at the end of thereportingperiod(C3)|27,786|Total actual guarantee balancefor the subsidiaries at the endofthereportingperiod(C4)|2,345.61|
|TotalguaranteeamountprovidedbytheCompany(totaloftheabove-mentionedthreekindsofguarantees)||||
|Total guarantee line approvedduring the reporting period(A1+B1+C1)|0|Total actual occurred amountof guarantee during thereportingperiod(A2+B2+C2)|153,827.48|
|Total guarantee line that hasbeen approved at the end of thereportingperiod(A3+B3+C3)|504,836|Total actual guarantee balanceat the end of the reportingperiod(A4+B4+C4)|329,401.38|
|Proportion of total guarantee amount (A4+B4+C4) to the netassetsoftheCompany||86.74%||
|Ofwhich:||||
|Amount of guarantee for shareholders, actual controller andrelatedparties(D)||0||
|Amount of debt guarantee provided for the guaranteed partywhose asset-liability ratio is not less than 70% directly orindirectly(E)||329,401.38||
|Part of the amount of the total guarantee over 50% of netassets(F)||139,515.16||
|Totalamountoftheabovethreeguarantees(D+E+F)||468,916.53||
|Explanation on possible bearing joint responsibility ofliquidationduetoimmatureguarantee(ifany)||Inapplicable||
|Explanation on provision of guarantees for external parties inviolationoftheprescribedprocedure(ifany)||Inapplicable||

Explanation onguarantee that adopts complex method
There was no any guarantee that adopted complex method of the Company during the reporting period.
(1) Illegalprovision ofguarantees forexternal parties
□Applicable√ Inapplicable
The Company did notillegally provideany guarantee for anyexternal party in thereporting period. 3.Othersignificantcontracts
□Applicable√ Inapplicable
There was noothersignificant contract of theCompany inthe reporting period.
4.Othersignificanttransactions
2015Semi-annualReportofKonkaGroupCo.,Ltd.□Applicable√ Inapplicable
The Company was not involved inany othersignificant transaction in thereporting period.
X. Commitments made by the Company or any shareholder holding over5% of theCompany’s shares in the reporting period or such commitments carried down into the reporting period
□Applicable√ Inapplicable
No such commitmentsin thereporting period.
XI.Engagement anddisengagementof theCPAsfirm
Has thesemi-annual financial report been audited?
√Yes□No
|||
|-|-|
|NameofdomesticCPAsfirmofauditingthesemi-annualfinancialreport|RuihuaCertifiedPublicAccountants(LLP)|
|Remuneration of domestic CPAs firm of auditing the semi-annualfinancialreport(RMBTenThousandYuan)|90|

Change the CPAs firm of the audit of the audit of the semi-annual financial report compared to the 2014annual report or not?
□Yes√No
XII. Punishment andrectification
□Applicable√ Inapplicable
No such cases in thereporting period.
XIII. Delisting risk dueto violationoflaws orregulations
□Applicable√ Inapplicable
No such risk inthe reporting period.
XIV.Othersignificantevents
√Applicable□ Inapplicable
||||||
|-|-|-|-|-|
|No.|Time|Nameofannouncement|Page|Link|
|||||www.cninfo.com.cn|
|Firsthalfyearof2015|||||
|2015-01|2015-3-28|Announcement onReceiptofTaxRebates|SecuritiesTimesB60,TaKungPaoB2|http://www.cninfo.com.cn/finalpage/2015-03-28/1200753459.PDF|
|2015-02|2015-4-3|Announcement on theResolution of the 15thSession of the 7th BoardofSupervisors|SecuritiesTimesB73,TaKungPaoB16-B18|http://www.cninfo.com.cn/finalpage/2015-04-03/1200782527.PDF|
|2015-03|2015-4-3|ForecastingPublicNoticeon Routine RelatedTransactionforY2015|SecuritiesTimesB73,TaKungPaoB16-B18|http://www.cninfo.com.cn/finalpage/2015-04-03/1200782520.PDF|
|2015-04|2015-4-3|Notice of Holding theY2014 Annual General|SecuritiesTimesB73,B74,TaKungPaoB16-B18|http://www.cninfo.com.cn/finalpage/2015-04-03/1200782525.PDF|

2015Semi-annualReportofKonkaGroupCo.,Ltd. Meeting
||||||
|-|-|-|-|-|
|2015-05|2015-4-3|Announcement on theChanges of Part of theAccountingPolicies|SecuritiesTimesB73,B74,TaKungPaoB16-B18|http://www.cninfo.com.cn/finalpage/2015-04-03/1200782538.PDF|
|2015-06|2015-4-3|Abstract of the Y2014Annual Report of theKonkaGroupCo.,Ltd.|SecuritiesTimesB73,B74,TaKungPaoB16-B18|http://www.cninfo.com.cn/finalpage/2015-04-03/1200782521.PDF|
|2015-07|2015-4-3|Y2014AnnualReport|SecuritiesTimesB73,B74,TaKungPaoB16-B18|http://www.cninfo.com.cn/finalpage/2015-04-03/1200782530.PDF|
|2015-08|2015-4-3|Announcement on theResolution of the 71stSession of the 7th BoardofDirectors|SecuritiesTimesB73,B74,TaKungPaoB16-B18|http://www.cninfo.com.cn/finalpage/2015-04-03/1200782524.PDF|
|2015-09|2015-4-3|Declaration of theNominators of theIndependent Directors oftheListedCompanies(DiXiaofeng)|SecuritiesTimesB73,B74,TaKungPaoB16-B18|http://www.cninfo.com.cn/finalpage/2015-04-03/1200782537.PDF|
|2015-10|2015-4-3|Declaration of theNominators of theIndependent Directors oftheListed Companies (LiLuoli)|SecuritiesTimesB73,B74,TaKungPaoB16-B18|http://www.cninfo.com.cn/finalpage/2015-04-03/1200782536.PDF|
|2015-11|2015-4-3|Declaration of theNominators of theIndependent Directors ofthe Listed Companies(ZhangShuhua)|SecuritiesTimesB73,B74,TaKungPaoB16-B18|http://www.cninfo.com.cn/finalpage/2015-04-03/1200782535.PDF|
|2015-12|2015-4-3|Declaration of theCandidates of theIndependent Directors oftheListedCompanies(DiXiaofeng)|SecuritiesTimesB73,B74,TaKungPaoB16-B18|http://www.cninfo.com.cn/finalpage/2015-04-03/1200782534.PDF|
|2015-13|2015-4-3|Declaration of theCandidates of theIndependent Directors oftheListed Companies (LiLuoli)|SecuritiesTimesB73,B74,TaKungPaoB16-B18|http://www.cninfo.com.cn/finalpage/2015-04-03/1200782533.PDF|
|2015-14|2015-4-3|Declaration of theCandidates of theIndependent Directors ofthe Listed Companies(ZhangShuhua)|SecuritiesTimesB73,B74,TaKungPaoB16-B18|http://www.cninfo.com.cn/finalpage/2015-04-03/1200782532.PDF|

2015Semi-annualReportofKonkaGroupCo.,Ltd. Announcement on the
SecuritiesTimesB40,Ta http://www.cninfo.com.cn/finalpage/2015- 2015-15 2015-4-14 Changes of the Office
KungPaoB7 04-14/1200825769.PDF
LocationoftheCompany
||||||
|-|-|-|-|-|
|2015-16|2015-4-16|Announcement on theStock Trading AbnormalFluctuations|SecuritiesTimesB80,TaKungPaoB2|http://www.cninfo.com.cn/finalpage/2015-04-16/1200839341.PDF|
|2015-17|2015-4-29|Test of the Y2015 FirstQuarterReport(Chinese)|SecuritiesTimesB76,TaKungPaoA20|http://www.cninfo.com.cn/finalpage/2015-04-29/1200930942.PDF|
|2015-18|2015-4-29|Full Test of the Y2015First Quarter Report(Chinese)|SecuritiesTimesB76,TaKungPaoA20|http://www.cninfo.com.cn/finalpage/2015-04-29/1200930945.PDF|
|2015-19|2015-5-8|Announcement on theStock Trading AbnormalFluctuations|SecuritiesTimesB80,TaKungPaoB1|http://www.cninfo.com.cn/finalpage/2015-05-08/1200979093.PDF|
|2015-20|2015-5-13|Announcement on theStock Trading AbnormalFluctuations|SecuritiesTimesB68,TaKungPaoB3|http://www.cninfo.com.cn/finalpage/2015-05-13/1201006433.PDF|
|2015-21|2015-5-15|Announcement on theShareholders Increasingthe Candidates of theNominated Directors andSupervisors|SecuritiesTimesB85,TaKungPaoB8|http://www.cninfo.com.cn/finalpage/2015-05-15/1201015562.PDF|
|2015-22|2015-5-15|Notice of Holding theY2014 Annual GeneralMeeting(renewed)|SecuritiesTimesB85,TaKungPaoB8|http://www.cninfo.com.cn/finalpage/2015-05-15/1201015561.PDF|
|2015-23|2015-5-15|Declaration of theCandidates of theIndependentDirectors|SecuritiesTimesB85,TaKungPaoB8|http://www.cninfo.com.cn/finalpage/2015-05-15/1201015563.PDF|
|2015-24|2015-5-15|Declaration of theNominators of theIndependentDirectors|SecuritiesTimesB85,TaKungPaoB8|http://www.cninfo.com.cn/finalpage/2015-05-15/1201015564.PDF|
|2015-25|2015-5-16|Announcement on theShareholders Increasingthe Candidates of theNominated Directors andSupervisors|SecuritiesTimesB37,TaKungPaoB11|http://www.cninfo.com.cn/finalpage/2015-05-16/1201020163.PDF|
|2015-26|2015-5-16|Notice of Holding theY2014 Annual GeneralMeeting(after thesecondrenewal)|SecuritiesTimesB37,TaKungPaoB11|http://www.cninfo.com.cn/finalpage/2015-05-16/1201020162.PDF|
|2015-27|2015-5-16|Declaration of theNominators of theIndependent Directors(XiaoZuhe)|SecuritiesTimesB37,TaKungPaoB11|http://www.cninfo.com.cn/finalpage/2015-05-16/1201020165.PDF|

2015Semi-annualReportofKonkaGroupCo.,Ltd. Declaration of the
Candidatures of the SecuritiesTimesB37,Ta http://www.cninfo.com.cn/finalpage/2015- 2015-28 2015-5-16
Independent Directors KungPaoB11 05-16/1201020164.PDF
(XiaoZuhe)
||||||
|-|-|-|-|-|
|2015-29|2015-5-19|Indicative Announcementon the ControllingShareholders ofIncreasing theShareholding of theSharesoftheCompany|SecuritiesTimesB49,TaKungPao11|http://www.cninfo.com.cn/finalpage/2015-05-19/1201031184.PDF|
||2015-5-19|Detailed Report of theChangesoftheEquities|SecuritiesTimesB49,TaKungPao11|http://www.cninfo.com.cn/finalpage/2015-05-19/1201031185.PDF|
|2015-30|2015-5-20|Announcement on theResolution of the 73rdSession of the 7th BoardofDirectors|SecuritiesTimesB37,TaKungPaoB2|http://www.cninfo.com.cn/finalpage/2015-05-20/1201035530.PDF|
|2015-31|2015-5-23|Indicative Announcementon Holding the Y2014AnnualGeneralMeeting|SecuritiesTimesB53,TaKungPaoA23|http://www.cninfo.com.cn/finalpage/2015-05-23/1201049180.PDF|
|2015-32|2015-5-27|Announcement on theGeneral Election of theEmployeeSupervisors|SecuritiesTimesB45,TaKungPaoB19|http://www.cninfo.com.cn/finalpage/2015-05-27/1201065868.PDF|
|2015-33|2015-5-29|Announcement on theResolution of the Y2014AnnualGeneralMeeting|SecuritiesTimesB4,TaKungPaoB2|http://www.cninfo.com.cn/finalpage/2015-05-29/1201078987.PDF|
|2015-34|2015-5-30|Announcement on theListing Suspension of theSignificantEvents|SecuritiesTimesB60,TaKungPaoB2|http://www.cninfo.com.cn/finalpage/2015-05-30/1201082236.PDF|
|2015-35|2015-6-5|Announcement on theTrading Resumption oftheSignificantEvents|SecuritiesTimesB60,TaKungPaoB3|http://www.cninfo.com.cn/finalpage/2015-06-05/1201106173.PDF|
|2015-36|2015-6-5|Announcement on theResolution of the 1stSession of the 8th BoardofDirectors|SecuritiesTimesB60,TaKungPaoB3|http://www.cninfo.com.cn/finalpage/2015-06-05/1201106172.PDF|
|2015-37|2015-6-5|Announcement on theResolution of the 1stSession of the 8th BoardofSupervisors|SecuritiesTimesB60,TaKungPaoB3|http://www.cninfo.com.cn/finalpage/2015-06-05/1201106171.PDF|
|2015-38|2015-6-12|Announcement on theListing Suspension of theSignificantEvents|SecuritiesTimesB36,TaKungPaoB2|http://www.cninfo.com.cn/finalpage/2015-06-12/1201139697.PDF|
|2015-39|2015-6-12|Announcement on theStock Trading Abnormal|SecuritiesTimesB36,TaKungPaoB2|http://www.cninfo.com.cn/finalpage/2015-06-12/1201139696.PDF|

2015Semi-annualReportofKonkaGroupCo.,Ltd. Fluctuations
||||||
|-|-|-|-|-|
|2015-40|2015-6-19|Announcement on theResolution of the 2ndSession of the 8th BoardofDirectors|SecuritiesTimesB60,TaKungPaoB2|http://www.cninfo.com.cn/finalpage/2015-06-19/1201168695.PDF|
|2015-41|2015-6-19|Announcement on theProgress of theSignificantEvents|SecuritiesTimesB60,TaKungPaoB2|http://www.cninfo.com.cn/finalpage/2015-06-19/1201168694.PDF|
|2015-42|2015-6-27|Announcement on theProgress of theSignificantEvents|SecuritiesTimesB37,TaKungPaoB9|http://www.cninfo.com.cn/finalpage/2015-06-27/1201200899.PDF|

2015Semi-annualReportofKonkaGroupCo.,Ltd. Section VI. Changes in Shares& Particulars about Shareholders I.Changeinshares
Unit:Share
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
||Beforethechange||Increase/decreaseinthechange(+,-)|||||Afterthechange||
||Number|Proportion|Issuanceofnewshares|Bonusshares|Capitalizationofpublicreservefund|Other|Subtotal|Number|Proportion|
|I.Sharessubjecttotradingmoratorium|198,381,940|16.48%||||63,405|63,405|198,445,345|16.49%|
|2. Shares held bystate-ownedcorporation|198,381,940|16.48%||||||198,381,940|16.48%|
|3, other domesticholdings||||||63,405|63,405|63,405|0.01%|
|Shares held by thedomesticindividuals||||||63,405|63,405|63,405|0.01%|
|II. Shares not subject totradingmoratorium|1,005,590,764|83.52%||||-63,405|-63,405|1,005,527,359|83.51%|
|1.RMBordinaryshares|599,914,960|49.83%||||||599,914,960|49.83%|
|2. Domestically listedforeignshares|405,675,804|33.69%||||-63,405|-63,405|405,612,399|33.68%|
|III.Totalshares|1,203,972,704|100.00%||||0|0|1,203,972,704|100.00%|

Notes: on 28 May 2015 of the Y2014 Annual General Meeting, Mr. Zhang Guanghui be selected as the Supervisor of the Company, who held 84,540 shares of the shares of the Company and according to the stipulations of the relevant laws and regulations, 63,405 shares ofwhich werethesharessubjecting to tradingmoratorium.
Reasons for changes in shares
□Applicable√ Inapplicable
Approval ofshare changes
□Applicable√ Inapplicable
Transfer of share ownership
□Applicable√ Inapplicable
Effects of changes in shares on the basic EPS, diluted EPS, net assets per share attributable to
2015Semi-annualReportofKonkaGroupCo.,Ltd. common shareholders of the Company and other financial indexes over the last year and the last reporting period
□Applicable√ Inapplicable
Other contents that the Company considers necessary or is required by the securities regulatory authorities todisclose
□Applicable√ Inapplicable
Change ofthetotal shares, shareholder structure, asset structureand liability structure
□Applicable√ Inapplicable
II.Total numberofshareholders and theirshareholdings
Unit:Share
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
|Total number of commonshareholders at the end of thereportingperiod||51,744||||Total number of preferred shareholders who had resumed theirvoting right at the end of thereporting period (if any) (seenote8)|||0||
|Shareholdingsofcommonshareholdersholdingmorethan5%sharesortop10shareholders|||||||||||
|Nameofshareholder|Natureofshareholder||Shareholdingpercentage(%)|Numberofsharesheldattheendofthereportingperiod|Increase/decreaseofsharesduringthereportingperiod||Numberofrestrictedsharesheld|Numberofnon-restrictedsharesheld|Pledgedorfrozenshares||
||||||||||Statusofshares|Numberofshares|
|OCTEnterprisesCo.|State-ownedcorporation||21.75%|261,873,466|0||198,381,940|63,491,526|Pledged|0|
||||||||||Frozen|0|
|CITICSecuritiesBrokerage(Hong Kong)Co.,Ltd.|Foreigncorporation||7.48%|90,000,555|90,000,555||0|90,000,555|Pledged|0|
||||||||||Frozen|0|
|GuoyuanSecuritiesBroker (HK)Co.,Ltd.|Foreigncorporation||2.81%|33,860,309|19,815,409||0|33,860,309|Pledged|0|
||||||||||Frozen|0|
|ChinaResources SCPTrust Co., Ltd.－ExtraordinaryNo. 18 CapitalTrust|Domesticnon-state-ownedcorporation||2.48%|29,878,723|6,762,855||0|29,878,723|Pledged|0|
||||||||||Frozen|0|
|Gaoling|Foreign||2.19%|26,400,62|0||0|26,400,625|Pledged|0|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
|Fund,L.P.|corporation||5|||||Frozen|0|
|Holy TimeGroupLimited|Foreigncorporation|2.18%|26,290,177|-20,243,438|0|26,290,177||Pledged|0|
|||||||||Frozen|0|
|ChinaResources SCPTrust Co., Ltd.－ExtraordinaryNo. 17 CapitalTrust|Domesticnon-state-ownedcorporation|2.00%|24,083,850|7,661,215|0|24,083,850||Pledged|0|
|||||||||Frozen|0|
|SunZhenxiang|Domesticindividual|1.40%|16,878,116|2,784,128|0|16,878,116||Pledged|0|
|||||||||Frozen|0|
|National SocialSecurity Fund118Group|Others|1.14%|13,702,689|13,702,689|0|13,702,689||Pledged|0|
|||||||||Frozen|0|
|NamNgai|Foreignindividual|0.97%|11,690,520|0|0|11,690,520||Pledged|0|
|||||||||Frozen|0|
|Strategic investor or generalcorporation becoming a top tenshareholder due to placing of newshares(ifany)||N/A||||||||
|Explanation on associatedrelationshipor/andpersonsactinginconcertamongtheabove-mentionedshareholders:||Jialong Investment Limited, a wholly-funded subsidiary of the Company’s first majorityshareholderOCTEnterprisesCo.,holds90,000,555commonsharesintheCompanythroughCITIC Securities Brokerage (Hong Kong) Co., Ltd. Therefore, Jialong Investment LimitedandOCTEnterprisesCo.arepartiesactinginconcert.TheCompanydoesnotknowwhethertheothershareholdersarerelatedpartiesandwhethertheyareacting-in-concertparties.||||||||
|Particularsaboutsharesheldbythetoptencommonshareholdersholdingsharesnotsubjecttotradingmoratorium||||||||||
|Nameofshareholder||Numberoftradablesharesheldattheperiod-end|||||Typeofshares|||
||||||||Type||Number|
|CITIC Securities Brokerage (HongKong)Co.,Ltd.||90,000,555|||||Domesticallylisted foreignshares||90,000,555|
|OCTEnterprisesCo.||63,491,526|||||RMB ordinaryshare||63,491,526|
|Guoyuan Securities Broker (HK)Co.,Ltd.||33,860,309|||||Domesticallylisted foreignshares||333,860,309|
|China Resources SCP Trust Co.,Ltd.－ExtraordinaryNo.18CapitalTrust||29,878,723|||||RMB ordinaryshare||29,878,723|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
|||||
|-|-|-|-|
|GaolingFund,L.P.|26,400,625|Domesticallylisted foreignshares|26,400,625|
|HolyTimeGroupLimited|26,290,177|Domesticallylisted foreignshares|26,290,177|
|China Resources SCP Trust Co.,Ltd.－ExtraordinaryNo.17CapitalTrust|24,083,850|RMB ordinaryshare|24,083,850|
|SunZhenxiang|16,878,116|RMB ordinaryshare|16,878,116|
|National Social Security Fund 118Group|13,702,689|RMB ordinaryshare|13,702,689|
|NamNgai|11,690,520|Domesticallylisted foreignshares|11,690,520|
|Explanation on associatedrelationshipor/andpersonsactinginconcert among the top ten tradableshareholders and between the topten tradable shareholders and thetoptenshareholders|Jialong Investment Limited, a wholly-funded subsidiary of the Company’s first majorityshareholderOCTEnterprisesCo.,holds90,000,555commonsharesintheCompanythroughCITIC Securities Brokerage (Hong Kong) Co., Ltd. Therefore, Jialong Investment LimitedandOCTEnterprisesCo.arepartiesactinginconcert.TheCompanydoesnotknowwhethertheothershareholdersarerelatedpartiesandwhethertheyareacting-in-concertparties.|||
|Explanation on the Top 10shareholders participating in themargintradingbusiness(ifany)(seenotes4)|SunZhenxiangholds11,386,300A-sharesthroughaclientcredittradingguaranteesecuritiesaccountofGFSecuritiesCo.,Ltd.|||

Did any of theCompany’s top 10 common shareholders or top 10 non-restricted common shareholders conduct any agreed buy-back in thereporting period?
□Yes√No
No such cases in thereporting period.
III. Changeofthecontrolling shareholderorthe actual controller
Change ofthecontrolling shareholderin thereporting period
□Applicable√ Inapplicable
The controlling shareholder oftheCompany did not change in thereporting period.
Change oftheactual controller inthereporting period
□Applicable√ Inapplicable
The actual controllerofthe Company didnot change in thereporting period.
IV. Any shareholding increase plan proposed or implemented by any shareholder or its
act-in-concert party during thereporting period
□Applicable√ Inapplicable
2015Semi-annualReportofKonkaGroupCo.,Ltd. To the best knowledge of the Company, no shareholder or its act-in-concert party proposed or implemented any shareholding increase plan during thereporting period.
2015Semi-annualReportofKonkaGroupCo.,Ltd. Section VII. Preference Shares
□Applicable√ Inapplicable
There was noany preference share of theCompanyin thereporting period.
2015Semi-annualReportofKonkaGroupCo.,Ltd. Section VIII. Directors, Supervisors& Senior Management Staff I.Changeofshareholdings ofdirectors, supervisors and seniormanagement staff
√Applicable□ Inapplicable
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
|Name|Officetitle|Incumbent/former|Numberofsharesheldattheperiod-begin(share)|Numberofsharesincreasedatreportingperiod(share)|Numberofsharesdecreasedatreportingperiod(share)|Numberofsharesheldattheperiod-end(share)|Numberofgrantedrestrictedsharesattheperiod-begin(share)|Numberofrestrictedsharesgrantedinreportingperiod(share)|Numberofgrantedrestrictedsharesattheperiod-end(share)|
|LiuFengxi|ChairmanoftheBoard|Current|0|0|0|0|0|0|0|
|JinQingjun|Director|Current|0|0|0|0|0|0|0|
|ChenYuehua|Director|Current|0|0|0|0|0|0|0|
|SongZhenhua|Director,VicePresident|Current|0|0|0|0|0|0|0|
|ZhangMin|IndependentDirector|Current|0|0|0|0|0|0|0|
|XiaoZuhe|IndependentDirector|Current|0|0|0|0|0|0|0|
|ZhangShuhua|IndependentDirector|Current|0|0|0|0|0|0|0|
|HaoGang|Supervisory|Current|0|0|0|0|0|0|0|
|ZhangGuanghui|Supervisor|Current|0|84,540|0|84,540|0|0|0|
|LiJun|EmployeeSupervisors|Current|0|0|0|0|0|0|0|
|LiuDan|President|Current|0|0|0|0|0|0|0|
|XiaoQing|ExecutiveVicePresident|Current|0|0|0|0|0|0|0|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
|HuangZhongtian|VicePresident|Current|0|0|0|0|0|0|0|
|HeJianjun|VicePresident|Current|0|0|0|0|0|0|0|
|LinGaike|VicePresident|Current|0|0|0|0|0|0|0|
|WanLibo|VicePresident|Current|0|0|0|0|0|0|0|
|LiHongtao|VicePresident|Current|0|0|0|0|0|0|0|
|LinHongfan|VicePresident|Current|0|0|0|0|0|0|0|
|WuYongjun|BoardSecretary|Current|0|0|0|0|0|0|0|
|ChenYuehua|BoardChairman|Left|0|0|0|0|0|0|0|
|SuZheng|Director|Left|0|0|0|0|0|0|0|
|WangXiaowen|Director|Left|0|0|0|0|0|0|0|
|HeHaibin|Director|Left|0|0|0|0|0|0|0|
|FengYutao|IndependentDirector|Left|0|0|0|0|0|0|0|
|YangHaiying|IndependentDirector|Left|0|0|0|0|0|0|0|
|ZhangZhong|IndependentDirector|Left|0|0|0|0|0|0|0|
|DongYaping|Supervisory|Left|0|0|0|0|0|0|0|
|LiuYong|EmployeeSupervisor|Left|0|0|0|0|0|0|0|
|LiuFengxi|President|Left|0|0|0|0|0|0|0|
|XiaoQing|BoardSecretary|Left|0|0|0|0|0|0|0|
|HuangZhiqiang|CFO|Left|0|0|0|0|0|0|0|
|Total|--|--|0|84,540|0|84,540|0|0|0|

Notes: on 27 Aug. 2015, the resolution of the 4th Session of the 8th Board of Directors decided
to engage Mr. Xiao Qing as the Executive Vice President and Mr. Wu Yongjun as the Board
2015Semi-annualReportofKonkaGroupCo.,Ltd. Secretary of theCompany.
II. Changeofdirectors, supervisors andseniormanagement staff
√Applicable□ Inapplicable
||||||
|-|-|-|-|-|
|Name|Position|Type|Date|Reason|
|LiuFengxi|Director|Appointmentanddismission|28May2015|Be elected as the Director through theAnnual GeneralMeeting|
|LiuFengxi|BoardChairman|Elected|18Jun.2015|Be elected as the Board Chairman through the BoardMeeting|
|JinQingjun|Director|Elected|28May2015|Be elected as the Director through theAnnual GeneralMeeting|
|ChenYuehua|Director|Appointmentanddismission|28May2015|Be elected as the Director through theAnnual GeneralMeeting|
|SongZhenhua|Director|Elected|28May2015|Be elected as the Director through theAnnual GeneralMeeting|
|ZhangMin|IndependentDirector|Elected|28May2015|Be elected as the Director through theAnnual GeneralMeeting|
|XiaoZuhe|IndependentDirector|Elected|28May2015|Be elected as the Independent Director through theAnnualGeneralMeeting|
|ZhangShuhua|IndependentDirector|Elected|28May2015|Be elected as the Independent Director through theAnnualGeneralMeeting|
|HaoGang|Supervisory|Elected|28May2015|Be elected as the Supervisor through the AnnualGeneral Meeting and be selected as the SupervisorythroughtheBoardofSupervisors|
|ZhangGuanghui|Supervisor|Elected|28May2015|Be elected as the Supervisor through the Board ofSupervisors|
|LiJun|EmployeeSupervisor|Elected|28May2015|BeelectedastheEmployeeSupervisorsthroughtheEmployees'Assembly|
|LiuDan|President|Engaged|18Jun.2015|BeengagedbythedecisionfromtheBoardofDirectors|
|SongZhenhua|VicePresident|Engaged|18Jun.2015|BeengagedbythedecisionfromtheBoardofDirectors|
|XiaoQing|Executive VicePresident|Engaged|27Aug.2015|BeengagedbythedecisionfromtheBoardofDirectors|
|WanLibo|VicePresident|Engaged|19May2015|BeengagedbythedecisionfromtheBoardofDirectors|
|LinHongfan|VicePresident|Engaged|18Jun.2015|BeengagedbythedecisionfromtheBoardofDirectors|
|WuYongjun|BoardSecretary|Engaged|27Aug.2015|BeengagedbythedecisionfromtheBoardofDirectors|
|SuZheng|Director|Left as termexpired|28May2015|TermexpiredoftheBoardofDirectors|
|WangXiaowen|Director|Left as termexpired|28May2015|TermexpiredoftheBoardofDirectors|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||||
|-|-|-|-|-|
|HeHaibin|Director|Left as termexpired|28May2015|TermexpiredoftheBoardofDirectors|
|FengYutao|IndependentDirector|Left as termexpired|28May2015|TermexpiredoftheBoardofDirectors|
|YangHaiying|IndependentDirector|Left as termexpired|28May2015|TermexpiredoftheBoardofDirectors|
|ZhangZhong|IndependentDirector|Left as termexpired|28May2015|TermexpiredoftheBoardofDirectors|
|DongYaping|Supervisory|Left as termexpired|28May2015|TermexpiredoftheBoardofSupervisors|
|LiuYong|EmployeeSupervisor|Left as termexpired|28May2015|TermexpiredoftheBoardofSupervisors|
|HuangZhiqiang|CFO|Left|18Jun.2015|Resignedowingtopersonalreasons|

2015Semi-annualReportofKonkaGroupCo.,Ltd. Section IX. Financial Report
I. Auditreport
II. Audited financial statement
1. Consolidatedbalancesheet
2. Consolidatedstatementofincome
3. Consolidatedstatementofcashflow
4. Consolidatedstatementofchangesinshareholders’equities
5. Balancesheet
6. Incomestatement
7. Cashflowstatement
8. Statementofchangesinstockholders'equityaccounts
9. Annexedtableoffinancialstatement
10. Supplementaryinformationofthenotesofthefinancialstatement
2015Semi-annualReportofKonkaGroupCo.,Ltd. I.Auditreport
Has this semi-annual report been audited?
√Yes□No
|||
|-|-|
|Typeofauditopinion|Standardunqualifiedauditopinion|
|Dateforsigningtheauditor’sreport|27Aug.2015|
|Nameoftheauditfirm|RuihuaCPAs(LLP)|
|DocumentNumberoftheauditor’sreport|R-H-S-Z[2015]No.44040034|
|NameoftheCPA|LiuJianhua,ShangQimei|

Whetherthesemi-annuial audit report was thenon-standard audit report
□Yes√No
Auditor’s Report
R-H-S-Z[2015]No. 44040034 Totheshareholders ofKonka Group Co., Ltd.,
We have audited the accompanying financial statements of Konka Group Co., Ltd. (hereafter referred to as “the Company”) and its subsidiaries (hereafter referred to as “the Group” in general) which comprise the consolidated andcompany’s balance sheets as at 30 Jun. 2015, and the consolidated andcompany’s income statements, the consolidated andcompany’s cash flow statements and the consolidated andcompany’s statements of changes inowners’ equityfor theJan-Jun .2015andnotes to these financial statements.
I.Management’s Responsibility fortheFinancial Statements
The management is responsible for the preparation of these financial statements in accordance with the Accounting Standards for Business Enterprises. This responsibility includes: (1) preparing financial statements according to the Accounting Standards for Business Enterprises and make them a fair presentation; and (2) designing, implementing and maintaining internal control relevant to the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
II.Auditor’s Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the China Standards on Auditing. Those standards require that we comply with ethical requirements of China CPAs and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on theauditor’s judgment, including the assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk assessments, the auditor
considers internal control relevant to theentity’s preparation of the financial statements and
fair statement in order to design audit procedures that are appropriate in the circumstances.
2015Semi-annualReportofKonkaGroupCo.,Ltd. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation ofthefinancial statements.
Webelieve that the audit evidence we have obtained is sufficient and appropriate to provide a basis forouraudit opinion.
III.Auditopinion
In our opinion, the financial statements have been prepared in accordance with the Accounting Standards for Business Enterprises in all material respects and give a fair view of the Company and itssubsidiaries’consolidated financial positions as at the first half year of 2015 and the consolidated business results and cash flows for the year then ended, as well as theCompany’s financial positions as at the Jan-Jun of .2015 and business results and cash flows for theyear then ended.
CPA: RuihuaCertified PublicAccountants (LLP) CPA: China·Beijing
27Aug. 2015
II.Financialstatements
Currency unit for thestatements in thenotes to thesefinancial statements: RMBYuan
1.Consolidated balance sheet
Prepared by KonkaGroup Co., Ltd.
30Jun. 2015
Unit:RMBYuan
||||
|-|-|-|
|Item|Closingbalance|Openingbalance|
|CurrentAssets:|||
|Monetaryfunds|2,265,265,648.68|1,703,135,732.18|
|Settlementreserves|||
|Intra-grouplendings|||
|Financial assets measured at fairvalue of which changes are recorded incurrentprofitsandlosses|||
|Derivativefinancialassets|||
|Notesreceivable|3,234,108,057.77|3,819,417,076.37|
|Accountsreceivable|2,205,869,401.51|2,259,293,207.16|
|Accountspaidinadvance|473,849,216.13|315,150,044.57|
|Premiumsreceivable|||
|Reinsurancepremiumsreceivable|||
|Receivable reinsurance contract|||

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||
|-|-|-|
|reserves|||
|Interestreceivable|2,911,894.95|1,885,727.36|
|Dividendreceivable|||
|Otheraccountsreceivable|299,254,830.25|298,975,391.68|
|Financial assets purchased underagreementstoresell|||
|Inventories|3,745,804,720.74|3,904,436,250.33|
|Assetsheldforsale|||
|Non-currentassetsduewithin1year|||
|Othercurrentassets|319,508,306.22|568,020,200.48|
|Totalcurrentassets|12,546,572,076.25|12,870,313,630.13|
|Non-currentassets:|||
|Loans by mandate and advancesgranted|||
|Available-for-salefinancialassets|305,809,971.20|245,033,609.00|
|Held-to-maturityinvestments|||
|Long-termaccountsreceivable|||
|Long-termequityinvestment|364,805,011.18|362,765,183.66|
|Investingrealestate|230,533,815.65|233,349,452.80|
|Fixedassets|1,759,970,665.94|1,783,695,548.92|
|Constructioninprogress|195,928,495.84|159,604,884.09|
|Engineeringmaterials|||
|Disposaloffixedassets|||
|Productionbiologicalassets|||
|Oil-gasassets|||
|Intangibleassets|354,648,538.76|347,626,130.58|
|R&Dexpense|||
|Goodwill|3,597,657.15|3,597,657.15|
|Long-termdeferredexpenses|50,637,205.71|25,792,805.06|
|Deferredincometaxassets|320,295,659.54|259,516,396.26|
|Othernon-currentassets|-|488,063,979.00|
|Totalofnon-currentassets|3,586,227,020.97|3,909,045,646.52|
|Totalassets|16,132,799,097.22|16,779,359,276.65|
|Currentliabilities:|||
|Short-termborrowings|5,539,496,207.68|5,145,712,436.91|
|BorrowingsfromCentralBank|||
|Customer bank deposits and due to|||

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||
|-|-|-|
|banksandotherfinancialinstitutions|||
|Intra-groupborrowings|||
|Financial liabilities measured at fairvalue of which changes are recorded incurrentprofitsandlosses|||
|Derivativefinancialliabilities|||
|Notespayable|1,069,722,035.13|911,355,028.47|
|Accountspayable|2,582,840,877.06|3,144,408,433.93|
|Accountsreceivedinadvance|402,867,136.96|302,904,453.86|
|Financialassetssoldforrepurchase|||
|Handling charges and commissionspayable|||
|Payrollpayable|215,006,492.49|299,272,715.05|
|Taxpayable|72,049,299.90|112,557,005.85|
|Interestpayable|32,580,621.62|22,872,418.43|
|Dividendpayable|12,039,727.04|-|
|Otheraccountspayable|1,261,835,707.99|1,376,803,381.03|
|Reinsurancepremiumspayable|||
|Insurancecontractreserves|||
|Payables for acting trading ofsecurities|||
|Payables for acting underwriting ofsecurities|||
|Liabilitiesheldforsale|||
|Non-current liabilities due within 1year|796,757.13|1,525,465.53|
|Othercurrentliabilities|||
|Totalcurrentliabilities|11,189,234,863.00|11,317,411,339.06|
|Non-currentliabilities:|||
|Long-termborrowings|678,111,262.86|957,541,210.52|
|Bondspayable|||
|Ofwhich:preferredshares|||
|Perpetualbonds|||
|Long-termpayables|30,133,928.20|30,029,990.10|
|Long-termpayrollpayables|26,256,521.15|28,554,734.16|
|Specificpayables|||
|Estimatedliabilities|||
|Deferredincome|147,931,651.71|147,315,999.02|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||
|-|-|-|
|Deferredincometaxliabilities|7,391,081.84|1,049,498.77|
|Othernon-currentliabilities|||
|Totalnon-currentliabilities|889,824,445.76|1,164,491,432.57|
|Totalliabilities|12,079,059,308.76|12,481,902,771.63|
|Owners’equity:|||
|Sharecapital|1,203,972,704.00|1,203,972,704.00|
|Otherequityinstruments|||
|Ofwhich:preferredshares|||
|Perpetualbonds|||
|Capitalreserves|1,291,877,244.65|1,289,403,563.99|
|Less:Treasurystock|||
|Othercomprehensiveincome|16,936,510.45|16,171,477.91|
|Specificreserves|||
|Surplusreserves|847,908,466.28|847,908,466.28|
|Provisionsforgeneralrisks|||
|Retainedprofits|437,029,524.46|746,022,758.89|
|Total equity attributable to owners oftheCompany|3,797,724,449.84|4,103,478,971.07|
|Minorityinterests|256,015,338.62|193,977,533.95|
|Totalowners’equity|4,053,739,788.46|4,297,456,505.02|
|Totalliabilitiesandowners’equity|16,132,799,097.22|16,779,359,276.65|

 Legalrepresentative:LiuFengxi Chiefoftheaccountingwork:XuYoushan
Chiefoftheaccountingorgan:XuYoushan
2.BalancesheetoftheCompany
Unit:RMBYuan
||||
|-|-|-|
|Item|Closingbalance|Openingbalance|
|CurrentAssets:|||
|Monetaryfunds|1,049,662,097.01|993,131,773.08|
|Financial assets measured at fairvalue of which changes are recorded incurrentprofitsandlosses|||
|Derivativefinancialassets|||
|Notesreceivable|3,023,526,485.21|3,664,117,423.56|
|Accountsreceivable|1,690,010,252.92|1,539,295,976.29|
|Accountspaidinadvance|325,383,806.52|349,343,179.42|
|Interestreceivable|22,236,655.07|14,450,153.53|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||
|-|-|-|
|Dividendreceivable|||
|Otheraccountsreceivable|860,013,572.76|988,199,630.05|
|Inventories|2,099,963,455.30|2,500,537,916.63|
|Assetsheldforsale|||
|Non-currentassetsduewithin1year|||
|Othercurrentassets|186,428,205.55|201,280,204.53|
|Totalcurrentassets|9,257,224,530.34|10,250,356,257.09|
|Non-currentassets:|||
|Available-for-salefinancialassets|273,703,636.20|218,983,609.00|
|Held-to-maturityinvestments|572,000,000.00|600,000,000.00|
|Long-termaccountsreceivable|||
|Long-termequityinvestment|1,740,702,147.33|1,608,674,456.09|
|Investingrealestate|230,533,815.65|233,349,452.80|
|Fixedassets|530,154,238.89|534,363,754.80|
|Constructioninprogress|27,317,551.97|37,567,861.10|
|Engineeringmaterials|||
|Disposaloffixedassets|||
|Productionbiologicalassets|||
|Oil-gasassets|||
|Intangibleassets|86,672,972.60|76,397,532.51|
|R&Dexpense|||
|Goodwill|||
|Long-termdeferredexpenses|37,834,404.29|14,567,206.83|
|Deferredincometaxassets|296,951,410.01|244,080,035.45|
|Othernon-currentassets|||
|Totalofnon-currentassets|3,795,870,176.94|3,567,983,908.58|
|Totalassets|13,053,094,707.28|13,818,340,165.67|
|Currentliabilities:|||
|Short-termborrowings|709,307,085.80|244,808,594.52|
|Financial liabilities measured at fairvalue of which changes are recorded incurrentprofitsandlosses|||
|Derivativefinancialliabilities|||
|Notespayable|416,904,914.18|367,803,372.65|
|Accountspayable|6,371,133,333.34|7,871,208,959.66|
|Accountsreceivedinadvance|320,440,041.22|190,627,895.21|
|Payrollpayable|103,808,582.75|146,758,331.08|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||
|-|-|-|
|Taxpayable|22,331,966.66|5,081,943.95|
|Interestpayable|5,624,327.52|5,406,211.20|
|Dividendpayable|12,039,727.04|-|
|Otheraccountspayable|1,345,069,025.79|1,103,672,772.19|
|Liabilitiesheldforsale|||
|Non-current liabilities due within 1year|||
|Othercurrentliabilities|||
|Totalcurrentliabilities|9,306,659,004.30|9,935,368,080.46|
|Non-currentliabilities:|||
|Long-termborrowings|||
|Bondspayable|||
|Ofwhich:preferredshares|||
|Perpetualbonds|||
|Long-termpayables|||
|Long-termpayrollpayables|||
|Specificpayables|||
|Estimatedliabilities|||
|Deferredincome|82,472,428.88|80,679,738.96|
|Deferredincometaxliabilities|5,960,028.72|-|
|Othernon-currentliabilities|||
|Totalnon-currentliabilities|88,432,457.60|80,679,738.96|
|Totalliabilities|9,395,091,461.90|10,016,047,819.42|
|Owners’equity:|||
|Sharecapital|1,203,972,704.00|1,203,972,704.00|
|Otherequityinstruments|||
|Ofwhich:preferredshares|||
|Perpetualbonds|||
|Capitalreserves|1,250,283,488.79|1,250,283,488.79|
|Less:Treasurystock|||
|Othercomprehensiveincome|542,790.41|471,827.51|
|Specificreserves|-|-|
|Surplusreserves|847,908,466.28|847,908,466.28|
|Retainedprofits|355,295,795.90|499,655,859.67|
|Totalowners’equity|3,658,003,245.38|3,802,292,346.25|
|Totalliabilitiesandowners’equity|13,053,094,707.28|13,818,340,165.67|

2015Semi-annualReportofKonkaGroupCo.,Ltd. Legalrepresentative:LiuFengxi Chiefoftheaccountingwork:XuYoushan
Chiefoftheaccountingorgan:XuYoushan
3.Consolidatedincomestatement
Unit:RMBYuan
||||
|-|-|-|
|Item|Reportingperiod|Sameperiodoflastyear|
|I.Totaloperatingrevenues|8,944,558,920.96|8,390,067,695.48|
|Including:Salesincome|8,944,558,920.96|8,390,067,695.48|
|Interestincome|||
|Premiumincome|||
|Handling charge and commissionincome|||
|II.Totaloperatingcosts|9,373,665,025.38|8,628,811,627.79|
|Including:Costofsales|7,791,215,800.57|7,003,790,313.05|
|Interestexpenses|||
|Handling charge and commissionexpenses|||
|Surrenders|||
|Netclaimspaid|||
|Net amount withdrawn for theinsurancecontractreserve|||
|Expenditureonpolicydividends|||
|Reinsurancepremium|||
|Taxesandassociatecharges|28,710,006.67|27,245,781.49|
|Sellinganddistributionexpenses|1,124,688,950.35|1,155,868,360.85|
|Administrativeexpenses|292,238,903.71|304,442,442.38|
|Financialexpenses|99,066,911.17|101,860,777.24|
|Assetimpairmentloss|37,744,452.91|35,603,952.78|
|Add: Gain/(loss) from change in fairvalue(“-”meansloss)|||
|Gain/(loss) from investment (“-”meansloss)|7,185,454.13|266,440,118.63|
|Including: share of profits inassociatesandjointventures|-5,017,326.86|1,720,001.40|
|Foreign exchange gains (“-” meansloss)|||
|III.Businessprofit(“-”meansloss)|-421,920,650.29|27,696,186.32|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||
|-|-|-|
|Add:non-operatingincome|69,423,163.55|58,215,468.02|
|Including: Gains on disposal ofnon-currentassets|140,774.90|160,385.54|
|Less:non-operatingexpense|3,222,304.15|4,035,941.02|
|Including: Losses on disposal ofnon-currentassets|1,333,624.80|3,468,914.31|
|IV.Totalprofit(“-”meansloss)|-355,719,790.89|81,875,713.32|
|Less:Incometaxexpense|-51,101,619.20|35,514,884.35|
|V.Netprofit(“-”meansloss)|-304,618,171.69|46,360,828.97|
|Net profit attributable to owners oftheCompany|-296,953,507.39|44,394,585.84|
|Minorityshareholders’income|-7,664,664.30|1,966,243.13|
|VI. After-tax net amount of othercomprehensiveincomes|1,132,503.31|2,175,683.27|
|After-tax net amount of othercomprehensive incomes attributable toownersoftheCompany|765,032.54|2,114,026.98|
|(I) Other comprehensive incomesthatwillnotbereclassifiedintogainsandlosses|||
|1. Changes in net liabilities orassets with a defined benefit plan uponre-measurement|||
|2. Enjoyable shares in othercomprehensive incomes in investees thatcannot be reclassified into gains andlossesundertheequitymethod|||
|(II)Othercomprehensiveincomesthat will be reclassified into gains andlosses|765,032.54|2,114,026.98|
|1. Enjoyable shares in othercomprehensive incomes in investees thatwill be reclassified into gains and lossesundertheequitymethod|||
|2. Gains and losses on fairvalue changes of available-for-salefinancialassets|90,185.65|21,115.80|
|3. Gains and losses onreclassifying held-to-maturityinvestments into available-for-salefinancialassets|||
|4. Effective hedging gains and|||

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||
|-|-|-|
|lossesoncashflows|||
|5. Foreign-currency financialstatementtranslationdifference|674,846.89|2,092,911.18|
|6.Other|||
|After-tax net amount of othercomprehensive incomes attributable tominorityshareholders|367,470.77|61,656.29|
|VII.Totalcomprehensiveincomes|-303,485,668.38|48,536,512.24|
|Attributable to owners of theCompany|-296,188,474.85|46,508,612.82|
|Attributable to minorityshareholders|-7,297,193.53|2,027,899.42|
|VIII.Earningspershare|||
|(I)Basicearningspershare|-0.25|0.04|
|(II)Dilutedearningspershare|-0.25|0.04|

 Legalrepresentative:LiuFengxi Chiefoftheaccountingwork:XuYoushan
Chiefoftheaccountingorgan:XuYoushan
4.IncomestatementoftheCompany
Unit:RMBYuan
||||
|-|-|-|
|Item|Reportingperiod|Sameperiodoflastyear|
|I.Totalsales|7,789,566,135.08|8,472,805,986.02|
|Less:costofsales|7,039,398,999.32|7,511,551,731.49|
|Businesstaxesandsurcharges|14,474,426.92|16,794,110.13|
|Distributionexpenses|809,860,840.08|922,354,852.66|
|Administrativeexpenses|153,399,610.11|196,095,536.45|
|Financialcosts|11,216,562.70|44,234,839.30|
|Impairmentloss|18,082,479.13|27,776,711.70|
|Add: gain/(loss) from change in fairvalue(“-”meansloss)|-|-|
|Gain/(loss) from investment (“-”meansloss)|39,372,796.93|271,435,144.18|
|Including:incomeforminvestmentonassociatesandjointventures|-1,682,308.76|-2,175,501.89|
|II.Businessprofit(“-”meansloss)|-217,493,986.25|25,433,348.47|
|Add:non-operatingincome|39,750,811.83|33,360,363.48|
|Including: Gains on disposal ofnon-currentassets|78,912.49|-|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||
|-|-|-|
|Less:non-operatingexpense|1,526,230.88|1,608,736.38|
|Including: Losses on disposal ofnon-currentassets|903,506.68|1,514,063.10|
|III.Totalprofit(“-”meansloss)|-179,269,405.30|57,184,975.57|
|Less:Incometaxexpense|-46,949,068.57|14,932,546.51|
|IV.Netprofit(“-”meansloss)|-132,320,336.73|42,252,429.06|
|V. After-tax net amount of othercomprehensiveincomes|70,962.90|21,115.80|
|(I)Othercomprehensiveincomesthatwill not be reclassified into gains andlosses|||
|1. Changes in net liabilities orassets with a defined benefit plan uponre-measurement|||
|2. Enjoyable shares in othercomprehensive incomes in investeesthat cannot be reclassified into gainsandlossesundertheequitymethod|||
|(II) Other comprehensive incomesthat will be reclassified into gains andlosses|70,962.90|21,115.80|
|1. Enjoyable shares in othercomprehensive incomes in investeesthat will be reclassified into gains andlossesundertheequitymethod|||
|2. Gains and losses on fair valuechanges of available-for-sale financialassets|70,962.90|21,115.80|
|3. Gains and losses onreclassifying held-to-maturityinvestments into available-for-salefinancialassets|||
|4. Effective hedging gains andlossesoncashflows|||
|5. Foreign-currency financialstatementtranslationdifference|||
|6.Other|||
|VI.Totalcomprehensiveincomes|-132,249,373.83|42,273,544.86|
|VII.Earningspershare|||
|(I)Basicearningspershare|||
|(II)Dilutedearningspershare|||

2015Semi-annualReportofKonkaGroupCo.,Ltd. Legalrepresentative:LiuFengxi Chiefoftheaccountingwork:XuYoushan
Chiefoftheaccountingorgan:XuYoushan
5.Consolidatedcashflowstatement
Unit:RMBYuan
||||
|-|-|-|
|Item|Reportingperiod|Sameperiodoflastyear|
|I.Cashflowsfromoperatingactivities:|||
|Cash received from sale ofcommoditiesandrenderingofservice|9,091,215,409.73|8,265,282,430.24|
|Net increase of deposits fromcustomersandduesfrombanks|||
|Netincreaseofloansfromthecentralbank|||
|Net increase of fundsborrowed fromotherfinancialinstitutions|||
|Cash received from premium oforiginalinsurancecontracts|||
|Net cash received from reinsurancebusiness|||
|Net increase of deposits of policyholdersandinvestmentfund|||
|Net increase of disposal of financialassets measured at fair value of whichchanges are recorded into current gainsandlosses|||
|Cashreceivedfrominterest,handlingchargesandcommissions|||
|Net increase of intra-groupborrowings|||
|Net increase of funds in repurchasebusiness|||
|Taxrefundsreceived|179,813,857.62|196,033,233.62|
|Other cash received relating tooperatingactivities|186,582,496.97|173,270,417.80|
|Subtotalofcashinflowsfromoperatingactivities|9,457,611,764.32|8,634,586,081.66|
|Cashpaidforgoodsandservices|7,641,403,251.15|5,557,372,388.56|
|Net increase of customer lendingsandadvances|||

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||
|-|-|-|
|Netincreaseoffundsdepositedinthecentral bank and amount due frombanks|||
|Cashforpayingclaimsoftheoriginalinsurancecontracts|||
|Cash for paying interest, handlingchargesandcommissions|||
|Cashforpayingpolicydividends|||
|Cashpaidtoandforemployees|914,786,833.95|881,787,596.74|
|Varioustaxespaid|290,017,993.03|414,347,427.94|
|Other cash payment relating tooperatingactivities|582,490,169.47|573,150,587.30|
|Subtotal of cash outflows fromoperatingactivities|9,428,698,247.60|7,426,658,000.54|
|Netcashflowsfromoperatingactivities|28,913,516.72|1,207,928,081.12|
|II.Cashflowsfrominvestingactivities:|||
|Cash received from withdrawal ofinvestments|20,170,536.85|13,879,620.00|
|Cash received from return oninvestments|13,104,708.65|157,693.56|
|Net cash received from disposal offixed assets, intangible assets and otherlong-termassets|244,057.50|7,917,613.23|
|Net cash received from disposal ofsubsidiariesorotherbusinessunits||233,782,351.98|
|Other cash received relating toinvestingactivities|1,788,563,979.00|200,000,000.00|
|Subtotal of cash inflows frominvestingactivities|1,822,083,282.00|455,737,278.77|
|Cash paid to acquire fixed assets,intangible assets and other long-termassets|122,139,343.19|626,949,134.37|
|Cashpaidforinvestment|70,266,706.00|7,723,300.00|
|Netincreaseofpledgedloans|||
|Net cash paid to acquire subsidiariesandotherbusinessunits|||
|Other cash payments relating toinvestingactivities|1,306,934,952.07|600,183,497.35|
|Subtotal of cash outflows frominvestingactivities|1,499,341,001.26|1,234,855,931.72|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||
|-|-|-|
|Netcashflowsfrominvestingactivities|322,742,280.74|-779,118,652.95|
|III. Cash Flows from FinancingActivities:|||
|Cash received from capitalcontributions|70,677,725.44||
|Including: Cash received fromminority shareholder investments bysubsidiaries|||
|Cashreceivedfromborrowings|2,233,051,652.35|1,671,417,041.46|
|Cash received from issuance ofbonds|||
|Other cash received relating tofinancingactivities|118,095,176.56|236,460.60|
|Subtotalofcashinflowsfromfinancingactivities|2,421,824,554.35|1,671,653,502.06|
|Repaymentofborrowings|2,137,458,379.74|2,027,899,932.25|
|Cash paid for interest expenses anddistributionofdividendsorprofit|68,163,779.14|44,821,809.15|
|Including: dividends or profit paidbysubsidiariestominorityshareholders|||
|Other cash payments relating tofinancingactivities|133,861,961.59|178,071,161.01|
|Sub-total of cash outflows fromfinancingactivities|2,339,484,120.47|2,250,792,902.41|
|Netcashflowsfromfinancingactivities|82,340,433.88|-579,139,400.35|
|IV. Effect of foreign exchange ratechangesoncashandcashequivalents|-37,751,951.34|10,892,224.69|
|V. Net increase in cash and cashequivalents|396,244,280.00|-139,437,747.49|
|Add:Opening balanceofcash andcashequivalents|1,640,236,837.08|1,771,489,421.21|
|VI. Closing balance of cash and cashequivalents|2,036,481,117.08|1,632,051,673.72|

Legalrepresentative:LiuFengxi Chiefoftheaccountingwork:XuYoushan
Chiefoftheaccountingorgan:XuYoushan
6.CashflowstatementoftheCompany
Unit:RMBYuan
||||
|-|-|-|
|Item|Reportingperiod|Sameperiodoflastyear|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||
|-|-|-|
|I.Cashflowsfromoperatingactivities:|||
|Cash received from sale ofcommoditiesandrenderingofservice|6,629,377,417.70|6,366,712,860.82|
|Taxrefundsreceived|64,799,118.52|74,807,745.10|
|Other cash received relating tooperatingactivities|1,377,079,891.69|161,045,296.10|
|Subtotalofcashinflowsfromoperatingactivities|8,071,256,427.91|7,090,629,881.02|
|Cashpaidforgoodsandservices|6,545,865,079.11|4,475,725,045.81|
|Cashpaidtoandforemployees|476,270,145.75|485,469,053.36|
|Varioustaxespaid|107,694,528.48|191,472,856.18|
|Other cash payment relating tooperatingactivities|1,141,233,856.69|616,128,790.00|
|Subtotal of cash outflows fromoperatingactivities|8,271,063,610.03|5,768,795,745.35|
|Netcashflowsfromoperatingactivities|-199,807,182.12|1,321,834,135.67|
|II.Cashflowsfrominvestingactivities:|||
|Cash received from retraction ofinvestments|5,278,509.85|261,567,420.00|
|Cash received from return oninvestments|23,022,273.10|8,624,360.22|
|Net cash received from disposal offixed assets, intangible assets and otherlong-termassets|55,338,137.50|7,556,113.23|
|Net cash received from disposal ofsubsidiariesorotherbusinessunits|8,889.24|-|
|Other cash received relating toinvestingactivities|1,400,000,000.00|200,000,000.00|
|Subtotal of cash inflows frominvestingactivities|1,483,647,809.69|477,747,893.45|
|Cash paid to acquire fixed assets,intangible assets and other long-termassets|25,438,491.22|540,291,381.68|
|Cashpaidforinvestment|188,835,410.00|1,723,300.00|
|Net cash paid to acquire subsidiariesandotherbusinessunits|||
|Other cash payments relating toinvestingactivities|1,374,884,590.00|640,000,000.00|
|Subtotal of cash outflows frominvestingactivities|1,589,158,491.22|693,950,702.68|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||
|-|-|-|
|Netcashflowsfrominvestingactivities|-105,510,681.53|-216,202,809.23|
|III. Cash Flows from FinancingActivities:|-|-|
|Cash received from capitalcontributions||-|
|Cashreceivedfromborrowings|61,422,000.00|-|
|Cash received from issuance ofbonds|-|-|
|Other cash received relating tofinancingactivities|434,734,396.24|235,988.85|
|Subtotalofcashinflowsfromfinancingactivities|496,156,396.24|235,988.85|
|Repaymentofborrowings|-|-|
|Cash paid for interest expenses anddistributionofdividendsorprofit|-|11,854,357.13|
|Other cash payments relating tofinancingactivities|133,921,663.91|176,578,387.43|
|Sub-total of cash outflows fromfinancingactivities|133,921,663.91|188,432,744.56|
|Netcashflowsfromfinancingactivities|362,234,732.33|-188,196,755.71|
|IV. Effect of foreign exchange ratechangesoncashandcashequivalents|-3,281,640.26|-530,199.59|
|V. Net increase in cash and cashequivalents|53,635,228.42|916,904,371.14|
|Add:Opening balanceofcash andcashequivalents|991,459,790.62|1,117,689,643.16|
|VI. Closing balance of cash and cashequivalents|1,045,095,019.04|2,034,594,014.30|

Legalrepresentative:LiuFengxi Chiefoftheaccountingwork:XuYoushan
Chiefoftheaccountingorgan:XuYoushan
7.Consolidatedstatementofchangesinowners’equity
Jan.–Jun.2015
Unit:RMBYuan
|||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
|Item|Reportingperiod|||||||||||||
||EquityattributabletoownersoftheCompany|||||||||||Minorityinterests|Totalowners’equity|
||Sharecapital|Otherequityinstruments|||Capitalreserve|Less:treasurystock|Othercomprehensive|Specificreserv|Surplusreserve|Generalriskreserv|Retainedprofit|||
|||Pref|Perp|Ot||||||||||

2015Semi-annualReportofKonkaGroupCo.,Ltd.
|||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
|||erredshares|etualbonds|her|||incomes|e||e||||
|I. Balance atthe end ofthe previousyear|1,203,972,704.00||||1,289,403,563.99||16,171,477.91||847,908,466.28||746,022,758.89|193,977,533.95|4,297,456,505.02|
|Add:change ofaccountingpolicy|-||||-||-||-||-|-|-|
|Correctionof errors inpreviousperiods|-||||-||-||-||-|-|-|
|Businessmergersunder thesamecontrol|-||||-||-||-||-|-|-|
|Other|-||||-||-||-||-|-|-|
|II. Balanceat thebeginning oftheyear|1,203,972,704.00|-|-|-|1,289,403,563.99|-|16,171,477.91|-|847,908,466.28|-|746,022,758.89|193,977,533.95|4,297,456,505.02|
|III. Increase/decrease inthe period(“-” meansdecrease)|-|-|-|-|2,473,680.66|-|765,032.54|-|-|-|-308,993,234.43|62,037,804.67|-243,716,716.56|
|(I) Totalcomprehensiveincomes|-||||-||765,032.54||-||-296,953,507.39|-7,297,193.53|-303,485,668.38|
|(II)Capitalincreasedand reducedbyowners|-|-|-|-|-|-|-|-|-|-|-|70,678,264.16|70,678,264.16|
|1.Commonsharesincreasedbyshareholders|-||||-||-||-||-|70,678,264.16|70,678,264.16|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
|||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
|2.Capitalincreasedbyholdersofotherequityinstruments|-||||-||-||-||-|-|-|
|3.Amountsofshare-basedpaymentsrecognizedinowners’equity|-||||-||-||-||-|-|-|
|4.Other|-||||-||-||-||-|-|-|
|(III)Profitdistribution|-|-|-|-|-|-|-|-|-|-|-12,039,727.04|-1,343,265.96|-13,382,993.00|
|1.Appropriationstosurplusreserves|-||||-||-||-||-|-|-|
|2.Appropriationstogeneralriskprovisions|-||||-||-||-||-|-|-|
|3.Appropriationstoowners(orshareholders)|-||||-||-||-||-12,039,727.04|-1,343,265.96|-13,382,993.00|
|4.Other|-||||-||-||-||-|-|-|
|(IV)Internalcarry-forward of owners’equity|-|-|-|-|-|-|-|-|-|-|-|-|-|
|1. Newincrease ofcapital (orsharecapital)from|-||||-||-||-||-|-|-|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
|||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
|capitalpublicreserves||||||||||||||
|2. Newincrease ofcapital (orsharecapital)fromsurplusreserves|-||||-||-||-||-|-|-|
|3.Surplusreserves formaking uplosses|-||||-||-||-||-|-|-|
|4.Other|-||||-||-||-||-|-|-|
|(V) Specificreserve|-|-|-|-|-|-|-|-|-|-|-|-|-|
|1.Withdrawnfor theperiod|-||||-||-||-||-|-|-|
|2. Usedintheperiod|-||||-||-||-||-|-|-|
|(VI)Other|-||||2,473,680.66||-||-||-|-|2,473,680.66|
|IV. Closingbalance|1,203,972,704.00|-|-|-|1,291,877,244.65|-|16,936,510.45|-|847,908,466.28|-|437,029,524.46|256,015,338.62|4,053,739,788.46|

 Legalrepresentative:LiuFengxi Chiefoftheaccountingwork:XuYoushan
Chiefoftheaccountingorgan:XuYoushan
Jan.-Jun.2014
Unit:RMBYuan
|||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
|Item|Lastyear|||||||||||||
||EquityattributabletoownersoftheCompany|||||||||||Minorityinterests|Totalowners’equity|
||Sharecapital|Otherequityinstruments|||Capitalreserve|Less:treasurystock|Othercomprehensiveincomes|Specificreserve|Surplusreserve|Generalriskreserve|Retainedprofit|||
|||Preferredshares|Perpetualbonds|Other||||||||||

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|
|I. Balance at theend of thepreviousyear|1,203,972,704.00||||1,314,409,687.82||16,179,316.17|847,908,466.28||705,438,958.07|193,008,519.16|4,280,917,651.50|
|Add: change ofaccountingpolicy|-||||-||-|-||-|-|-|
|Correction oferrors in previousperiods|-||||-||-|-||-|-|-|
|Businessmergers under thesamecontrol|-||||-||-|-||-|-|-|
|Other|-||||-||-|-||-|-|-|
|II. Balance at thebeginning of theyear|1,203,972,704.00|-|-|-|1,314,409,687.82|-|16,179,316.17|847,908,466.28|-|705,438,958.07|193,008,519.16|4,280,917,651.50|
|III. Increase/decrease in theperiod (“-” meansdecrease)|-|-|-|-|-25,006,123.83|-|-7,838.26|-|-|40,583,800.82|969,014.79|16,538,853.52|
|(I) Totalcomprehensiveincomes|-||||-||-7,838.26|-||52,623,527.86|7,965,513.47|60,581,203.07|
|(II) Capitalincreased andreducedbyowners|-|-|-|-|-|-|-|-|-|-|-6,996,498.68|-6,996,498.68|
|1.Commonsharesincreasedbyshareholders|-||||-||-|-||-|-|-|
|2.Capitalincreasedbyholdersofotherequityinstruments|-||||-||-|-||-|-|-|
|3.Amountsofshare-basedpaymentsrecognizedinowners’equity|-||||-||-|-||-|-|-|
|4.Other|-||||-||-|-||-|-|-|
|(III) Profitdistribution|-|-|-|-|-|-|-|-|-|-12,039,727.04|-|-12,039,727.04|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|
|1.Appropriations tosurplusreserves|-||||-||-|-||-|-|-|
|2.Appropriations togeneral riskprovisions|-||||-||-|-||-|-|-|
|3.Appropriations toowners (orshareholders)|-||||-||-|-||-12,039,727.04|-|-12,039,727.04|
|4.Other|-||||-||-|-||-|-|-|
|(IV) Internalcarry-forward ofowners’equity|-|-|-|-|-|-|-|-|-|-|-|-|
|1. Newincrease of capital(or share capital)fromcapitalpublicreserves|-||||-||-|-||-|-|-|
|2. Newincrease of capital(or share capital)from surplusreserves|-||||-||-|-||-|-|-|
|3. Surplusreserves formakinguplosses|-||||-||-|-||-|-|-|
|4.Other|-||||-||-|-||-|-|-|
|(V) Specificreserve|-|-|-|-|-|-|-|-|-|-|-|-|
|1. Withdrawnfortheperiod|-||||-||-|-||-|-|-|
|2.Usedintheperiod|-||||-||-|-||-|-|-|
|(VI)Other|-||||-25,006,123.83||-|-||-|-|-25,006,123.83|
|IV. Closingbalance|1,203,972,704.00|-|-|-|1,289,403,563.99|-|16,171,477.91|847,908,466.28|-|746,022,758.89|193,977,533.95|4,297,456,505.02|

Legalrepresentative:LiuFengxi Chiefoftheaccountingwork:XuYoushan
2015Semi-annualReportofKonkaGroupCo.,Ltd. Chiefoftheaccountingorgan:XuYoushan
8.Statementofchangesinowners’equityoftheCompany
Jan.–Jun.2015
Unit:RMBYuan
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
|Item|Reportingperiod|||||||||||
||Sharecapital|Otherequityinstruments|||Capitalreserve|Less:treasurystock|Othercomprehensiveincomes|Specificreserve|Surplusreserve|Retainedprofit|Totalowners’equity|
|||Preferredshares|Perpetualbonds|Other||||||||
|I. Balance at theendofthepreviousyear|1,203,972,704.00|-|-|-|1,250,283,488.79|-|471,827.51|-|847,908,466.28|499,655,859.67|3,802,292,346.25|
|Add: change ofaccountingpolicy|-|-|-|-|-|-|-|-|-|-|-|
|Correction oferrors in previousperiods|-|-|-|-|-|-|-|-|-|-|-|
|Other|-|-|-|-|-|-|-|-|-|-|-|
|II. Balance at thebeginning of theyear|1,203,972,704.00|-|-|-|1,250,283,488.79|-|471,827.51|-|847,908,466.28|499,655,859.67|3,802,292,346.25|
|III. Increase/decrease in theperiod (“-” meansdecrease)|-|-|-|-|-|-|70,962.90|-|-|-144,360,063.77|-144,289,100.87|
|(I) Totalcomprehensiveincomes|-|-|-|-|-|-|70,962.90|-|-|-132,320,336.73|-132,249,373.83|
|(II) Capitalincreased andreducedbyowners|-|-|-|-|-|-|-|-|-|-|-|
|1.Commonsharesincreasedbyshareholders|-|-|-|-|-|-|-|-|-|-|-|
|2.Capitalincreasedbyholdersofotherequityinstruments|-|-|-|-|-|-|-|-|-|-|-|
|3.Amountsofshare-basedpayments|-|-|-|-|-|-|-|-|-|-|-|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
|recognizedinowners’equity||||||||||||
|4.Other|-|-|-|-|-|-|-|-|-|-|-|
|(III) Profitdistribution|-|-|-|-|-|-|-|-|-|-12,039,727.04|-12,039,727.04|
|1.Appropriations tosurplusreserves|-|-|-|-|-|-|-|-|-|-|-|
|2.Appropriations toowners (orshareholders)|-|-|-|-|-|-|-|-|-|-12,039,727.04|-12,039,727.04|
|3.Other|-|-|-|-|-|-|-|-|-|-|-|
|(IV) Internalcarry-forward ofowners’equity|-|-|-|-|-|-|-|-|-|-|-|
|1. Newincrease of capital(or share capital)fromcapitalpublicreserves|-|-|-|-|-|-|-|-|-|-|-|
|2. Newincrease of capital(or share capital)from surplusreserves|-|-|-|-|-|-|-|-|-|-|-|
|3. Surplusreserves formakinguplosses|-|-|-|-|-|-|-|-|-|-|-|
|4.Other|-|-|-|-|-|-|-|-|-|-|-|
|(V) Specificreserve|-|-|-|-|-|-|-|-|-|-|-|
|1. Withdrawnfortheperiod|-|-|-|-|-|-|-|-|-|-|-|
|2.Usedintheperiod|-|-|-|-|-|-|-|-|-|-|-|
|(VI)Other|-|-|-|-|-|-|-|-|-|-|-|
|IV. Closingbalance|1,203,972,704.00|-|-|-|1,250,283,488.79|-|542,790.41|-|847,908,466.28|355,295,795.90|3,658,003,245.38|

Legalrepresentative:LiuFengxi Chiefoftheaccountingwork:XuYoushan
2015Semi-annualReportofKonkaGroupCo.,Ltd. Chiefoftheaccountingorgan:XuYoushan
Jan.-Jun.2014
Unit:RMBYuan
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
|Item|Sameperiodoflastyear|||||||||||
||Sharecapital|Otherequityinstruments|||Capitalreserve|Less:treasurystock|Othercomprehensiveincomes|Specificreserve|Surplusreserve|Retainedprofit|Totalowners’equity|
|||Preferredshares|Perpetualbonds|Other||||||||
|I. Balance at theendofthepreviousyear|1,203,972,704.00|-|-|-|1,250,133,590.04|-|-|-|847,908,466.28|711,968,983.25|4,013,983,743.57|
|Add: change ofaccountingpolicy|-|-|-|-|-|-|-|-|-|-|-|
|Correction oferrors in previousperiods|-|-|-|-|-|-|-|-|-|-|-|
|Other|-|-|-|-|-|-|-|-|-|-|-|
|II. Balance at thebeginning of theyear|1,203,972,704.00|-|-|-|1,250,133,590.04|-|-|-|847,908,466.28|711,968,983.25|4,013,983,743.57|
|III. Increase/decrease in theperiod (“-” meansdecrease)||-|-|-|149,898.75|-|471,827.51|-|-|-212,313,123.58|-211,691,397.32|
|(I) Totalcomprehensiveincomes||-|-|-|-|-|471,827.51|-|-|-200,273,396.54|-199,801,569.03|
|(II) Capitalincreased andreducedbyowners|-|-|-|-|-|-|-|-|-|-|-|
|1.Commonsharesincreasedbyshareholders|-|-|-|-|-|-|-|-|-|-|-|
|2.Capitalincreasedbyholdersofotherequityinstruments|-|-|-|-|-|-|-|-|-|-|-|
|3.Amountsofshare-basedpaymentsrecognizedinowners’equity|-|-|-|-|-|-|-|-|-|-|-|
|4.Other|-|-|-|-|-|-|-|-|-|-|-|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
|(III) Profitdistribution|-|-|-|-|-|-|-|-|-|-12,039,727.04|-12,039,727.04|
|1.Appropriations tosurplusreserves|-|-|-|-|-|-|-|-|-|-|-|
|2.Appropriations toowners (orshareholders)|-|-|-|-|-|-|-|-|-|-12,039,727.04|-12,039,727.04|
|3.Other|-|-|-|-|-|-|-|-|-|-|-|
|(IV) Internalcarry-forward ofowners’equity|-|-|-|-|-|-|-|-|-|-|-|
|1. Newincrease of capital(or share capital)fromcapitalpublicreserves|-|-|-|-|-|-|-|-|-|-|-|
|2. Newincrease of capital(or share capital)from surplusreserves|-|-|-|-|-|-|-|-|-|-|-|
|3. Surplusreserves formakinguplosses|-|-|-|-|-|-|-|-|-|-|-|
|4.Other|-|-|-|-|-|-|-|-|-|-|-|
|(V) Specificreserve|-|-|-|-|-|-|-|-|-|-|-|
|1. Withdrawnfortheperiod|-|-|-|-|-|-|-|-|-|-|-|
|2.Usedintheperiod|-|-|-|-|-|-|-|-|-|-|-|
|(VI)Other|-|-|-|-|149,898.75|-|-|-|-|-|149,898.75|
|IV. Closingbalance|1,203,972,704.00|-|-|-|1,250,283,488.79|-|471,827.51|-|847,908,466.28|499,655,859.67|3,802,292,346.25|

 Legalrepresentative:LiuFengxi Chiefoftheaccountingwork:XuYoushan
Chiefoftheaccountingorgan:XuYoushan
III.Company Profile
2015Semi-annualReportofKonkaGroupCo.,Ltd.
||
|-|
|Konka group company limited|
|2015 1 June notes to the financial statements|
|(Unless otherwise indicated, amounts to RMB|

I Thebasicsituationof thecompany
1.Establishment
Konka Group Co., Ltd. (hereinafter referred to as “Company” or “the Company”), is a joint-stock limited company reorganized from the former Shenzhen Konka Electronic Co., Ltd. in August 1991 upon approval of thePeople’s Government of Shenzhen Municipality, and has its ordinary shares (A-share and B-share) listed on Shenzhen Stock Exchange with prior consent from thePeople’s Bank of China Shenzhen Special Economic Zone Branch. On August 29, 1995, the Company, renamed to “Konka Group Co., Ltd.”, obtained corporate business license (registration No.: 440301501121863) with its main business falling into electronic industry.
2.ShareCapital Changes uponEstablishment
On November 27, 1991, with approval from the SRYFZ No. 102[1991] document as issued by thePeople’s Bank of China Shenzhen Special Economic Zone Branch, Shenzhen Konka Electronic Co., Ltd., during December8—December 31, 1991, has issued 128,869,000 RMB ordinary shares (A-share) at a par value of RMB1.00 per share, of which the original net assets were converted into 98,719,000 state-owned institutional shares, 30,150,000 new shares were issued, including 26,500,000 circulating shares issued to the public and 3,650,000staffshares issued to thestaffoftheCompany.
On January 29, 1992, with approval from the SRYFZ No. 106[1991] document as issued by thePeople’s Bank of China Shenzhen Special Economic Zone Branch, Shenzhen Konka Electronic Co., Ltd., during December 20,1991— January 31, 1992, has issued to investors abroad 58,372,300 RMB special shares (B-share) at a par value of RMB1.00 per share, of which 48,372,300 shares held by the former foreign investor andfounder—Hong Kong Ganghua Electronic Group Co., Ltd. are converted into foreign legalperson’s shares, and 10,000,000B-shares are issued additionally.
On April 10, 1993, the Proposal on Profit Distribution and Dividend Payout 1992 was adopted at the second general meeting of shareholders of the Company. With approval from the SZBF No. 2[1993] document as issued by Shenzhen Securities Regulatory Office, the Company began to perform dividend policy for FY 1992 as of April 30, 1993: distributing RMB 0.90 in cash plus 3.5 bonus shares for every 10 shares to all shareholders. The total capital stock reached 187,473,150shares after this distribution.
On April 18, 1994, the Proposal on Profit Distribution and Dividend Payout 1993 was adopted at the third general meeting of shareholders of the Company.With approval from the SZBF No. 115[1994] document as issued by Shenzhen Securities Regulatory Office, the
Company began to perform dividend policy for FY1993 as of June 10, 1994: distributing
RMB 1.10 in cash plus 5 bonus shares (including 4.4 profit bonus shares and 0.6 bonus share
capitalized from capital public reserve) for every 10 shares to all shareholders. The total
2015Semi-annualReportofKonkaGroupCo.,Ltd. capital stock reached 281,209,724 shares after this distribution and capitalization from capital publicreserve.
On June 2, 1994, in accordance with the provisions that “staff shares could go public and be transferred six months after listing”, as jointly promulgated by the State Commission for Restructuring the Economic System and the StateCouncil’s Securities Commission, the staff shares of the Company was planned to be listed on the flow on June 6, 1994, with the prior consent of Shenzhen Securities Regulatory Officeand Shenzhen StockExchange.
On October 8, 1994, the Proposal on Negotiable Bonus Shares of B-Share Corporate Shareholders 1992 was adopted at the 1994 interim general meeting of shareholders of the Company. With approval from the SZBF No. 224[1994] document as issued by Shenzhen Securities Regulatory Office, the 16,930,305 bonus shares for FY 1992 granted to foreign legal persons were listed and negotiated at B-sharemarket onOctober 26,1994.
On February 6, 1996, the Proposal on ShareAllotment Modes 1996 was adopted at the 1996 interim general metering of shareholders of the Company. With approval from the SZBF No. 5[1996] document as issued by Shenzhen Securities Regulatory Office, and reexamination from the ZJPSZ No. 16[1996] document and ZJGZ No. 2[1996] document as issued by China Securities Regulatory Commission, on July 16, 1996 and October 29, 1996, all shareholders were respectively allotted three shares for every ten existing shares held at RMB 6.28/A-share and HKD 5.85/B-share. Corporate shareholders took their respective existing shares as bases for full subscription of the allocable shares. The total capital stock reached 365,572,641 shares after thisallotment.
On January 25, 1998, the Plan on Share Allotment 1998 was adopted at the 1998 interim general meeting of shareholders of the Company. With approval from the ZZBZ No. 29[1998] document as issued by Shenzhen Securities Regulatory Office, and ZJSZ No.64[1998] document as issued by China Securities Regulatory Commission, on July 15, 1998, negotiable A-shares were allotted in proportion of 3:10 at RMB 10.50/A-share. For such reasons as continued weakness in B-share secondary market (lower than share allotment price), B-share negotiation and allotment plan was canceled, and the corporate shareholders of the Company waived the preemptive right. The total capital stock reached 389,383,603 shares after thisallotment.
On June 30, 1999, the Proposal on Profit Distribution and Capitalization from Capital Public Reserve 1998 was adopted at the eighth general meeting of shareholders of the Company. On August 20, 1999, the profit distribution for FY 1998 was carried out: all shareholders were presented RMB3.00 in cash for every 10 shares, plus 2 shares capitalized from capital public reserve.The total capital stock reached 467,260,323 shares after this capitalization.
On June 30, 1999, the Plan on A-Share Issue for Capital Increase was adopted at the eighth general meeting of shareholders of the Company. With approval from the ZJFXZ No.140[1999] document as issued by China Securities Regulatory Commission, on November 1, 1999, 80,000,000 A-shares were additionally issued to the public at RMB15.50/share. The totalcapital stock reached 547,260,323shares after thisadditional issue.
On May 30, 2000, the Plan on Profit Distribution and Dividend Payout 1999 was adopted at the ninth general meeting of shareholders of the Company. On July 25, 2000, the profit distribution for FY 1999 was carried out: all shareholders were distributed RMB4.00 in cash plus 1 bonus shares for every 10 shares. The total capital stock reached 601,986,352 shares after thisdistribution.
On April 3, 2008, the 7th meeting of the sixth Board of Directors was convened, during which the following resolutions were discussed and adopted: based on the total capital stock
2015Semi-annualReportofKonkaGroupCo.,Ltd. of 601,986,352 shares for the year ended December 31, 2007, capitalization from capital public reserve was made to all shareholders at a proportion of 1:1, namely 10 new shares for every 10 existing shares. And the said resolution was subject to approval by the 2007 annual general meeting of shareholders convened on May 26, 2008. The Company, in June 2008, implemented the capitalization from capital public reserve and went through the formalities for transfer registration with China Securities Depository and Clearing Corporation Limited. On December 16, 2008, with approval from the SMGZF No. 2662[2008] document as issued by Shenzhen Bureau of Trade and Industry, the Company was agreed to increase its share capital, and went through the formalities for registration of changes with the administration for industry and commerce onApril 10, 2009. The total capital stock reached 1,203,972,704shares after change.
3. Approved business scope: research and development, production and operation of such household appliances as televisions, refrigerators, washing machines, and personal electronic appliances; manufacturing and application of home AV, IPTV set-top boxes, digital TV receivers (including ground receiving equipment of satellite television broadcasting), digital products, mobile communication equipments and terminal products, daily-use electronic products, automotive electronic products, satellite navigation systems, intelligent transportation systems, fire-fighting and security systems, office equipments, computers, displays, large screen display systems; LED (OLED) back light, illumination, light-emitting devices, and packaging thereof; Touch TV AIO, wireless broadcasting television transiting equipment; electronic parts and components, moulds, plastic and rubber products, and packing materials, design and in-door installation security products, monitoring products, wireless and cable digital television system and system integration, and technical consultancy and after-sale paid services of related products (except mobile phone, the other products in the above business scope are manufactured in other places outside Shenzhen); Wholesale, retail, import& export and relevant support services of the aforesaid products (including spare parts) (Commodities subject to state trading management are not involved. Products involved in quota, license management and other specified management shall be subject to the relevant state provisions.); sale of self-developed technological achievements; provision of maintenance services, technical consultant service for electronic products; ordinary cargo transportation, domestic freight forwarding, warehousing services; consultancy on enterprise management; and self-owned property leasing and management services, recovery of waste electrical appliances and electronic products (excluding dissembling) (operated by branch offices); and outsourcing services of information technology and business procedures by means of undertaking services in the way of outsourcing, including management and maintenance of system application, management of information technology, bank background service, financial settlement, human resource service, software development, call center,and data processing.
4. The financial statements of the Company were submitted upon approval of the Board of Directors on27Aug. 2015.
5. There were 45 subsidiaries included in the consolidation scope of 2015 of the Company, and please refer to the Notes VIII. “Equities among other entities” for details. There were 6 subsidiaries increased and 1 decreased in the consolidation scope of 2015 over the last year of the Company, and the gains and losses as well as the cash flows of the subsidiary which be decreased before the date losing the control right should be recorded in the consolidation of the reporting period and please refer to the Notes VII. “Changes of the consolidation scope” fordetails.
2015Semi-annualReportofKonkaGroupCo.,Ltd. 6.Acheck listofcorporate names and theirabbreviations mentioned in thisReport
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|-|-|
|Corporatename|Abbreviation|
|ShenzhenKonkaTelecommunicationsTechnologyCo.,Ltd.|TelecommunicationTechnology|
|ShenzhenKonkaPrecisionMoldManufacturingCo.,Ltd.|PrecisionMold|
|ShenzhenKonkaElectronicCo.,Ltd.|KonkaElectronic|
|ShenzhenKonkaInformationNetworkCo.,Ltd.|InformationNetwork|
|ShenzhenKonkaPlasticProductsCo.,Ltd.|PlasticProducts|
|ShenzhenKonkaHousingAppliancesCo.,Ltd.|HousingAppliances|
|ShenzhenElectronicFittingsTechnologyCo.,Ltd.|FittingsTechnology|
|MudanjiangArcticOceanAppliancesCo.,Ltd.|MudanjiangAppliances|
|ChongqingKonkaAutomotiveElectronicCo.,Ltd.|ChongqingElectronic|
|ChongqingQingjiaElectronicsCo.,Ltd.|ChongqingQingjia|
|AnhuiKonkaElectronicCo.,Ltd.|AnhuiKonka|
|AnhuiKonkaHouseholdAppliancesCo.,Ltd.|AnhuiHouseholdAppliances|
|ChangshuKonkaElectronicCo.,Ltd.|ChangshuKonka|
|KunshanKonkaElectronicCo.,Ltd.|KunshanKonka|
|DongguanKonkaElectronicCo.,Ltd.|DongguanKonka|
|DongguanKonkaPackingMaterialsCo.,Ltd.|DongguanPacking|
|DongguanKonkaMouldPlasticCo.,Ltd.|DongguanMouldPlastic|
|BoluoKonkaPCBCo.,Ltd.|BoluoKonka|
|BoluoKonkaPrecisionTechnologyCo.,Ltd.|BoluoPrecision|
|Konka(Nanhai)DevelopmentCenter|NanhaiInstitute|
|HongKongKonkaCo.,Ltd.|HongKongKonka|
|KonkaHouseholdAppliancesInvestment&DevelopmentCo.,Ltd.|KonkaHouseholdAppliancesInvestment|
|KonkaHouseholdAppliancesInternationalTradingCo.,Ltd.|KonkaHouseholdAppliancesInternationalTrading|
|KONKAAMERICA,INC.|KONKAAMERICA|
|Konka(Europe)Co.,Ltd.|KonkaEurope|
|DongguanXutongdaMouldPlasticCo.,Ltd.|Xutongda|
|ShenzhenKonkaOptoelectronicTechnologyCo.,Ltd.|KonkaOptoelectronic|
|ShenzhenWankaidaScienceandTechnologyCo.,Ltd.|Wankaida|
|KunshanKangshengInvestmentDevelopmentCo.,Ltd.|KunshanKangsheng|
|AnhuiKonkaTongchuangHouseholdAppliancesCo.,Ltd.|AnhuiTongchuang|
|IndonesiaKonkaElectronicsCo.,Ltd.|IndonesiaKonka|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
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|-|-|
|Corporatename|Abbreviation|
|ShenzhenShushidaLogisticsServiceCo.,Ltd.|ShushidaLogistics|
|BeijingKonkaElectronicCo.,Ltd.|BeijingKonkaElectronic|
|KunshanJielunteMouldPlasticCo.,Ltd.|KunshanJielunte|
|WuhanJielunteMouldPlasticCo.,Ltd.|WuhanJielunte|
|ChuzhouJielunteMouldPlasticCo.,Ltd.|ChuzhouJielunte|
|ShenzhenKonkaYishijieCommercialDisplayCo.,Ltd.|KonkaYishijie|
|ShenzhenYishijieCommercialDisplayServiceCo.,Ltd.|YishijieCommercia|
|XiamenDalongTradingCo.,Ltd.|XiamenDalong|
|TianjinUseeKangrongCultureCommunicationCo.,Ltd.|TianjinKangrong|
|AnhuiJiasenPrecisionScienceandTechnologyCo.,Ltd.|AnhuiJiasen|
|ShenzhenKangqiaoJiachengRealEstateInvestmentCo.,Ltd.|KangqiaoJiacheng|
|KonkaZhishengCo.,Ltd.|KonkaZhisheng|
|AnhuiKaikaiShijieE-commerceCo.,Ltd.|KaikaiShijie|
|ShenzhenE2infoInternetScienceandTechnologyCo.,Ltd.|E2info|

II.Basis forthepreparationoffinancial statements
1.Preparation basic
With the going-concern assumption as the basis and based on transactions and other events that actually occurred, the Group prepared financial statements in accordance with<The Accounting Standards for BusinessEnterprises—BasicStandard> issued by the Ministry of Finance with Decree No. 33 and revised with Decree No. 76, the 41 specific accounting standards, the Application Guidance of Accounting Standards for Business Enterprises, the Interpretation of Accounting Standards for Business Enterprises and other regulations issued and revised from 15 Feb. 2006 onwards (hereinafter jointly referred to as “the Accounting Standards for Business Enterprises”, “China Accounting Standards” or “CAS”), as well as the Rules for Preparation Convention of Disclosure of Public Offering Companies No.15– General Regulations for Financial Reporting (revised in 2014) by China Securities Regulatory Commission.
In accordance with relevant provisions of theAccounting Standards for Business Enterprises, the Group adopted the accrual basis in accounting. Except for some financial instruments, where impairment occurred on an asset, an impairment reserve was withdrawn accordingly pursuant to relevant requirements.
III.Statementof Compliancewith theAccountingStandards forBusiness Enterprises The financial statements prepared by the Group are in compliance with in compliance with
the Accounting Standards for Business Enterprises, which factually and completely present
theCompany’s financial positions as at 30 Jun. 2015, business results and cash flows of
2015Semi-annualReportofKonkaGroupCo.,Ltd.Jan.–Jun. of 2015, and other relevant information. In addition, theCompany’s and theGroup’s financial statements meet the requirements of disclosing financial statements and notes thereto stated in the Rules for Preparation Convention of Disclosure of Public Offering Companies No.15– General Regulations for Financial Reporting (revised in 2014) by China Securities Regulatory Commission.
IV.Importantaccounting policies andestimations
The Company and each subsidiary formulated certain specific accounting policies and accounting estimates according to the actual production and operation characteristics and the regulations of the relevant ASBE on the transactions and events of the revenues recognition. For the details, please refer to each description of Notes IV. 22 “Revenues”. For the notes of the significant accounting judgment and estimations made by the management layer, please referto Notes IV.27“Significant accounting judgment and estimations”.
1.Fiscalperiod
TheGroup’s fiscal periods include fiscal years and fiscal periods shorter than a complete fiscal year. TheGroup’s fiscal year starts on 1 Jan. and ends on 31 Dec. of every year according tothe Gregorian calendar.
2.Operating cycle
Anormal operating cycle refers to a period from the Group purchasing assets for processing to realizing cash or cash equivalents.An operating cycle for the Group is 12 months, which is also theclassification criterion for theliquidity ofits assets and liabilities.
3.Recordingcurrency
Renminbi is the dominant currency used in the economic circumstances where the Group and its domestic subsidiaries are involved. Therefore, the Group and its domestic subsidiaries use Renminbi as their bookkeeping base currency. And the Group adopted Renminbi as the bookkeeping base currency whenpreparing thefinancial statements for thereporting year. 4. Accounting treatment methods for business combinations under the same control or not underthesame control
Business combinations, it is refer to two or more separate enterprises merge to form a reporting entity transactions or events. Business combination is divided into under the same control and thosenonunder thesame control.
(1)Business combinations underthe samecontrol
Abusiness combination under the same control is a business combination in which all of the combining enterprises are ultimately controlled by the same party or the same parties both before and after the business combination and on which the control is not temporary. In a business combination under the same control, the party which obtains control of other combining enterprise(s) on the combining date is the combining party, the other combining enterprise(s) is (are) the combined party. The “combining date” refers to the date on which thecombiningparty actually obtains control onthecombined party.
The assets and liabilities that the combining party obtains in a business combination shall be measured on the basis of their carrying amount in the combined party on the combining date. As for the balance between the carrying amount of the net assets obtained by the combining party and the carrying amount of the consideration paid by it (or the total par value of the shares issued), the additional paid-in capital (share premium) shall be adjusted. If the additional paid-in capital (share premium) is not sufficient to be offset, the retained earnings
2015Semi-annualReportofKonkaGroupCo.,Ltd. shall beadjusted.
The direct cost for the business combination of the combining party shall be recorded into the profits andlosses at thecurrent period.
(2)Business combinations not underthesame control
A business combination not under the same control is a business combination in which the combining enterprises are not ultimately controlled by the same party or the same parties both before and after the business combination. In a business combination not under the same control, the party which obtains the control on other combining enterprise(s) on the purchase dateis theacquirer,andother combiningenterprise(s) is (are)the acquiree.
For a business combination not under the same control, the combination costs shall include the fair values, on the acquisition date, of the assets paid, the liabilities incurred or assumed and the equity securities issued by the acquirer in exchange for the control on the acquiree, the expenses for audit, legal services and assessment, and other administrative expenses, which are recorded into the profits and losses in the current period. The trading expenses for the equity securities or debt securities issued by the acquirer as the combination consideration shall be recorded into the amount of initial measurement of the equity securities or debt securities. The involved contingent consideration shall be recorded into the combination costs at its fair value on the acquiring date. Where new or further evidences emerge, within 12 months since the acquiring date, against the existing circumstances on the acquiring date and the contingent consideration thus needs to be adjusted, the combined goodwill shall be adjusted accordingly. The combination costs of the acquirer and the identifiable net assets obtained by it in the combination shall be measured according to their fair values at the acquiring date. The acquirer shall recognize the positive balance between the combination costs and the fair value of the identifiable net assets it obtains from the acquiree as business reputation. Where the combination costs are less then the fair value of the identifiable net assets it obtains from the acquiree, the acquirer shall re-examine the measurement of the fair values of the identifiable assets, liabilities and contingent liabilities it obtains from the acquiree as well as the combination costs. If, after the reexamination, the combination costs are still less than the fair value of the identifiable net assets it obtains from the acquiree, the acquirer shall record the balance into the profits and losses of the current period.
As for the deductible temporary differences the acquirer obtains from the acquiree which are not recognized into deferred income tax liabilities due to their not meeting the recognition standards, if new or further information shows that the relevant situation has existed on the acquiring date and the economic benefits brought by the deductible temporary differences the acquirer obtains from the acquiree on the acquiring date can be realized, they shall be recognized into deferred income tax assets and the relevant goodwill shall be reduced. Where the goodwill is not sufficient to be offset, the difference shall be recognized into the profits and losses in the current period. In other circumstances than the above, where the deductible temporary differences are recognized into deferred income tax assets on the acquiring date, they shall berecorded intotheprofits andlosses in thecurrent period.
In a business combination not under same control realized by two or more transactions of exchange, according to about the 5th Notice about the Treasury Issuing the Accounting Standards for Enterprises (Finance accounting)[2012] No. 19 Criterion about the “package deal” (see note 4, 4 (2)), Whether the deals are “package deal” or not, belong to the “package deal”, see the previous paragraphs described in this section and note 4, 10 “long term equity investment transaction” and conduct accounting treatment, those not belong to the “package
2015Semi-annualReportofKonkaGroupCo.,Ltd. deal” distinguish between the individual financial statements and the consolidated financial statements and conduct relevant accounting treatment.
In the individual financial statements, the sum of the book value and new investment cost of the Group holds in the acquiree before the acquiring date shall be considered as initial cost of the investment. Other related comprehensive gains in relation to the equity interests that the Group holds in the acquiree before the acquiring date shall be treated onthe same basis as the acquiree directly disposes the related assets or liabilities when disposing the investment (that is, except for the corresponding share in the changes in the net liabilities or assets with a defined benefit plan measured at the equity method arising from theacquiree’s re-measurement, theothers shall be transferred into current investment gains).
In theGroup’s consolidated financial statements, as for the equity interests that the Group holds in the acquiree before the acquiring date, they shall be re-measured according to their fair values at the acquiring date; the positive difference between their fair values and carrying amounts shall be recorded into the investment gains for the period including the acquiring date. Other related comprehensive gains in relation to the equity interests that the Group holds in the acquiree before the acquiring date shall be treated on the same basis as the acquiree directly disposes the related assets or liabilities when disposing the investment (that is, except for the corresponding share in the changes in the net liabilities or assets with a defined benefit plan measured at the equity method arising from theacquiree’s re-measurement, the others shall be transferred into current investment gains on the acquiring date).
5.Methods forpreparing consolidated financialstatements
(1)Principlefor determining theconsolidation scope
The consolidation scope for financial statements is determined on the basis of control. The term “control” is the power of the Group upon an investee, with which it can take part in relevant activities of the investee to obtain variable returns and is able to influence the amount of returns. The consolidated financial statements comprise the financial statements of theGroup and its subsidiaries.Asubsidiary isan enterprise orentity controlled bytheGroup. (2)Methods for preparing theconsolidated financial statements
Subsidiaries are fully consolidated from the date on which the Group obtains control on their net assets and operation decision-making and are de-consolidated from the date when such control ceases. As for a disposed subsidiary, its operating results and cash flows before the disposal date has been appropriately included in the consolidated income statement and cash flow statement; and as for subsidiaries disposed in the current period, the opening items in the consolidated balance sheet are not adjusted. For a subsidiary acquired in a business combination not under the same control, its operating results and cash flows after the acquiring date have been appropriately included in the consolidated income statement and cash flow statement, and the opening items and comparative items in the consolidated financial statements are not adjusted. For a subsidiary acquired in a business combination under the same control or a combined party obtained in a takeover, its operating results and cash flows from the beginning of the reporting period of the combination to the combination date have been appropriately included in the consolidated income statement and cash flow statement, and the comparative items in the consolidated financial statements are adjusted at thesametime.
The financial statements of subsidiaries are adjusted in accordance with the accounting policies and accounting period of the Group during the preparation of the consolidated
2015Semi-annualReportofKonkaGroupCo.,Ltd. financial statements, where the accounting policies and the accounting periods are inconsistent between the Group and subsidiaries. For a subsidiary acquired from a business combination not under the same control, the individual financial statements of the subsidiary areadjusted based onthefair valueof theidentifiablenet assets at theacquisitiondate.
All significant inter-group balances, transactions and unrealized profits are offset in the consolidated financial statements.
The portion of asubsidiary’sshareholders’equity and the portion of asubsidiary’s net profits and losses for the period not held by the Group are recognized as minority interests and minority shareholder profits and losses respectively and presented separately undershareholders’equity and net profits in the consolidation financial statements. The portion of asubsidiary’s net profits and losses for the period that belong to minority interests is presented as the item of “minority shareholder profits and losses” under the bigger item of net profits in the consolidated financial statements. Where the loss of a subsidiary shared by minority shareholders exceeds the portion enjoyed by minority shareholders in thesubsidiary’s openingowners’equity,minorityinterests are offset.
Where the Group losses control on its original subsidiaries due to disposal of some equity investments or other reasons, the residual equity interests are re-measured according to the fair value on the date when such control ceases. The summation of the consideration obtained from the disposal of equity interests and the fair value of the residual equity interests, minus the portion in the originalsubsidiary’s net assets measured on a continuous basis from the acquisition date that is enjoyable by the Group according to the original shareholding percentage in the subsidiary, is recorded in investment gains for the period when theGroup’s control on the subsidiary ceases. Other comprehensive incomes in relation to the equity investment in the original subsidiary are treated on the same accounting basis as the acquiree directly disposes the relevant assets or liabilities (that is, except for the changes in the net liabilities or assets with a defined benefit plan resulted from re-measurement of the original subsidiary, the rest shall all be transferred into current investment gains) when such control ceases. And subsequent measurement is conducted on the residual equity interests according to the No. 2 Accounting Standard for Business Enterprises—Long-term Equity Investments or the No. 22Accounting Standard for BusinessEnterprises—Recognition and Measurement of Financial Instruments. For details, see note IV, 13 “long term equity investment” or 9 “financial instruments”.
Where the Group losses control on its original subsidiaries due to step by step disposal of equity investments through multiple transactions, it need to distinguish the Group losses control on its subsidiaries due to disposal of equity investments whether belongs to a package deal. All the transaction terms, conditions and economic impact of the disposal ofsubsidiaries’ equity investment are in accordance with one or more of the following conditions, which usually indicate the multiple transactions, should be considered as a package deal for accounting treatment.① These deals are at the same time or under the condition of considering the influence of each other to concluded;②These transactions only be as a whole can achieve a complete business result;③ The occurrence of a deal depends on at least one othertransactions；④ A deal alone is not economical, it is economical with other trading together. Those not belong to a package deal, each of them a deal depends on
2015Semi-annualReportofKonkaGroupCo.,Ltd. circumstances respectively conduct accounting treatment in accordance with the applicable principles of “part disposal of subsidiaries of a long-term equity investment under the condition of not losing control on its subsidiaries” (see note IV 13, (2)④) and “Where the Group losses control on its original subsidiaries due to disposal of some equity investments or other reasons” (See the front paragraph) relevant transactions of the Group losses control on its subsidiaries due to disposal of equity investments belonging to a package deal, considered as a transaction and conduct accounting treatment. However, Before losing control, every disposal cost and corresponding net assets balance of subsidiary of disposal investment are confirmed as other comprehensive income in consolidated financial statements, which together transferred into the current profits and losses in the lose of control ,when theGroup losingcontrol onitssubsidiary.
6.Classificationof jointarrangements andaccounting treatmentofjointoperations Ajoint arrangement refers to an arrangement jointly controlled by two participants or above. The Group classifies joint arrangements into joint operations and joint ventures according to its rights and duties in the joint arrangements. Ajoint operation refers to a joint arrangement where the Group enjoys assets and has to bear liabilities related to the arrangement. A joint venture refers to a joint arrangement where the Group is only entitled to the net assets of the arrangement.
TheGroup’s investments in joint ventures are measured at the equity method according to the accounting policies mentioned in Note IV. 13 (2)② “Long-term equity investments measured at theequity method”.
For a joint operation, the Group, as a joint operator, recognizes the assets and liabilities that it holds and bears in the joint operation, and recognizes the jointly-held assets and jointly-borne liabilities according to theGroup’s stake in the joint operation; recognizes the income from sale of theGroup’s share in the output of the joint operation; recognizes the income from sale of the jointoperation’s outputs according to theGroup’s stake in it; and recognizes the expense solely incurred to the Group and the expense incurred to the joint operation according totheGroup’s stakein it.
When the Group, as a joint operator, transfers or sells assets (the assets not constituting business, the same below) to the joint operation, or purchases assets from the joint operation, before the assets are sold to a third party, the Group only recognizes the share of the other joint operators in the gains and losses arising from the sale. Where impairment occurs to the assets as prescribed in<The Accounting Standard No. 8 for BusinessEnterprises—AssetImpairment>, the Group shall fully recognizes the loss for a transfer or sale of assets to a joint operation; and shall recognize the loss according to its stake in the joint operation for a purchase ofassets from thejointoperation.
7.Recognition standardforcash andcash equivalents
In theGroup’s understanding, cash and cash equivalents include cash on hand, any deposit that can be used for cover, and short-term (usually due within 3 months since the day of purchase) and high circulating investments, which are easily convertible into known amount ofcash andwhose risksin change of valueare minimal.
8.Foreigncurrency businesses and translationof foreigncurrency financialstatements (1)Accounting treatments fortranslation of foreign currency transactions
2015Semi-annualReportofKonkaGroupCo.,Ltd. As for a foreign currency transaction, the Company shall convert the amount in a foreign currency into amount in its bookkeeping base at the spot exchange rate (usually referring to the central parity rate announced by thePeople’s Bank of China, the same below) of the transaction date, while as for such transactions as foreign exchange or involving in foreign exchange, the Company shall converted into amount in the bookkeeping base currency at actual exchange rate thetransaction is occurred.
(2) Accounting treatments for translation of foreign currency monetary items and non-monetary items
On the balance sheet date, the foreign currency monetary items shall be translated at the spot exchange rate on the balance sheet date. The exchange difference arising from the difference between the spot exchange rate on the balance sheet date and the spot exchange rate at the time of initial recognition or prior to the balance sheet date shall be recorded in the profits and losses in the current period, excluding the following situations:① the exchange difference arising from foreign currency loans related to acquisition of fixed assets shall be treated at the principle of capitalization of borrowing costs;② the exchange difference arising from the hedging instruments used for effective hedging of net overseas operation investments shall be recorded into other comprehensive incomes, and shall be recognized into current gains and losses when the net investments are disposed; and③ the exchange difference arising from change in the book balance of foreign currency monetary items available for sale except the amortized costs shall be recorded into other comprehensive gains andlosses.
When it involves overseas business in preparing the consolidated financial statement, for the translation difference of foreign currency monetary items of net investment in overseas business arising from the change in exchange rate, it shall be recorded into other comprehensive incomes; and be recorded into disposal gains and losses at current period when disposing overseas business.
Aforeign currency non-monetary item measured at the historical costs shall still be translated at the spot exchange rate on the transaction date. Where the foreign non-monetary items measured at the fair value shall be converted into amount in its bookkeeping base currency at spot exchange rate, the exchange gains and losses arising thereof shall be treated as change in fair value, and recorded into the current period gains and losses or as other comprehensive incomes.
(3)Translation of foreign currency financial statements
When it involves overseas business in preparing the consolidated financial statement, for the translation difference of foreign currency monetary items of net investment in overseas business arising from the change in exchange rate, it shall be recorded into the item of “difference of foreign currency financial statement translation” under theowners’equity; and be recorded into disposal gains and losses at current period when disposing overseas business.
The foreign currency financial statement of overseas business should be translated in to RMB financial statement by the following methods: The asset and liability items in the balance sheets shall be translated at a spot exchange rate on the balance sheet date. Among theowner’s equity items, except for the items as “undistributed profits”, other items shall be translated at the spot exchange rate at the time when they are incurred. The income and
2015Semi-annualReportofKonkaGroupCo.,Ltd. expense items in the profit statements shall be translated at the spot exchange rate of the transaction date. The undistributed profits at year-begin is the undistributed profits at the end of last year after the translation; undistributed profits at year-end shall be listed as various distribution items after the translation; after the translation, the balance between assets and the sum of liabilities andowners’ equities shall be recorded into other comprehensive gains and losses as difference of foreign currency translation. Where an enterprise disposes of an overseas business without the control right, it shall shift the differences, which is presented under the items of theowner’s equities in the balance sheet and which arises from the translation of foreign currency financial statements relating to this overseas business, into the disposal profits and losses of the current period by all or proportion of the disposed overseas business.
Foreign cash flow shall be translated at the spot exchange rate of the date of cash flow incurred. The influence of exchange rate on the cash flow shall be adjustment item and individuallylistedin thecash flow statement.
And the opening balance and the actual balance of last year shall be listed at the amounts after translation offoreign currency financial statement inlast year.
Where the control of the Group over an overseas operation ceases due to disposal of all or some of theGroup’sowner’s equity in the overseas operation or other reasons, the foreign-currency statement translation difference belonging to the parentcompany’sowner’s equity in relation to the overseas operation which is stated under theshareholders’equity in thebalance sheet shallbe all restated as gains and lossesof thedisposal period.
Where theGroup’s equity in an overseas operation decreases due to disposal of some equity investment or other reasons but the Group still has control over the overseas operation, the foreign-currency statement translation difference in relation to the disposed part of the overseas operation shall be recorded into minority interests instead of current gains and losses. Ifwhat’s disposed is some equity in an overseas associated enterprise or joint venture, the foreign-currency statement translation difference related to the overseas operation shall be recorded into the gains and losses of the current period of the disposal according to the disposalratio.
9.Financial instruments
The Group recognizes a financial asset or liability when it becomes a party of the relevant financial instrument contract. Financial assets and liabilities are measured at fair value in initial recognition. As for the financial assets and liabilities measured at fair value of which changes are recorded into current gains and losses, the relevant dealing expenses are directly recorded into gains and losses; and the dealing expenses on other kinds of financial assets and liabilities are included intheamounts initiallyrecognized.
(1)Determination ofthefair valueof main financial assets andfinancial liabilities
Fair value refers to the price that a market participant shall receive for selling an asset or shall pay for transferring a liability in an orderly transaction on the measurement date.As for the financial assets or financial liabilities for which there is an active market, the quoted prices in the active market shall be used to determine the fair values thereof. The quoted prices in the active market refers to the prices available from stock exchange,broker’s agencies, guilds, pricing organization and etc., which represent the actual trading price under equal transaction. Where there is no active market for a financial instrument, the enterprise concerned shall adopt value appraisal techniques, including the prices adopted by the parties, who are familiar with the condition, in the latest market transaction upon their own free will,
2015Semi-annualReportofKonkaGroupCo.,Ltd. the current fair value obtained by referring to other financial instruments of the same essential nature, the cash flow capitalization method and the option pricing model, etc., to determineits fair value.
(2)Classification, recognitionand measurement offinancial assets
The purchase and sale of financial assets under the normal ways shall be recognized and stopped to be recognized respectively at the price of transaction date. Financial assets shall be classified into the following four categories when they are initially recognized: (a) the financial assets which are measured at their fair values and the variation of which is recorded into the profits and losses of the current period, (b) the investments which will be held to their maturity; (c) loans and the account receivables; and (d) financial assets available for sale.
① The financial assets which are measured at their fair values and the variation of which is recorded into theprofits and lossesof thecurrent period
Including transactional financial assets and the financial assets which are designated to be measured at their fair value when they are initially recognized and of which the variation is recorded into theprofits and lossesof thecurrent period;
The financial assets meeting any of the following requirements shall be classified as transactional financialassets：A.The purpose to acquire the said financial assets is mainly for selling them in the near future; B. Forming a part of the identifiable combination of financial instruments which are managed in a centralized way and for which there are objective evidences proving that the enterprise may manage the combination by way of short-term profit making in the near future; C. Being a derivative instrument, excluding the designated derivative instruments which are effective hedging instruments, or derivative instruments to financial guarantee contracts, and the derivative instruments which are connected with the equity instrument investments for which there is no quoted price in the active market, whose fair value cannot be reliably measured, and which shall be settled by delivering the said equityinstruments.
The financial assets meeting any of the following requirements shall be designated as financial assets which are measured at their fair values and the variation of which is recorded into the profits and losses of the current period for initial recognition: A. the designation can eliminate or significantly reduce the difference of relevant gains and losses between recognition and measurement causing from different bases for measurement of financial assets; B. The official written documents for risk management and investment strategies of the enterprise have clearly stated that it shall ,manage, evaluate and report to important management personnel based on the fair value, about the financial assets group or the group offinancial assets& liabilities which thefinancial assets are belong to.
For the financial assets which are measured at their fair values and the variation of which is recorded into the profits and losses of the current period shall continue to be measured by fair value, gains and losses of change in fair value, dividends and interest related with these financial assets shouldbe recorded intogains and losses ofcurrent period.
① The financial assets which are measured at their fair values and the variation of which is recorded into theprofits and lossesof thecurrent period
Including transactional financial assets and the financial assets which are designated to be
2015Semi-annualReportofKonkaGroupCo.,Ltd. measured at their fair value when they are initially recognized and of which the variation is recorded into theprofits and lossesof thecurrent period;
The financial assets meeting any of the following requirements shall be classified as transactional financialassets：A.The purpose to acquire the said financial assets is mainly for selling them in the near future; B. Forming a part of the identifiable combination of financial instruments which are managed in a centralized way and for which there are objective evidences proving that the enterprise may manage the combination by way of short-term profit making in the near future; C. Being a derivative instrument, excluding the designated derivative instruments which are effective hedging instruments, or derivative instruments to financial guarantee contracts, and the derivative instruments which are connected with the equity instrument investments for which there is no quoted price in the active market, whose fair value cannot be reliably measured, and which shall be settled by delivering the said equityinstruments.
The follow-up measurement of the tradable financial assets is by fair value, and the profits or losses formed from the changes of the fair value and the relevant dividend and interests of the financial assets shouldbe recorded inthe current gains and losses.
②Held-to-maturity investment
The term “held-to-maturity investment” refers to a non-derivative financial asset with a fixed date of maturity, a fixed or determinable amount of repo price and which the enterprise holds fora definitepurpose ortheenterpriseis able to holduntilits maturity.
For the held-to-maturity investment adopting actual interest rate method, which is measured at the post-amortization costs, the profits and losses that arise when such financial assets or financial liabilities are terminated from recognition, or are impaired or amortized, shall be recorded into theprofits and lossesof thecurrent period.
The actual interest rate method refers to the method by which the post-amortization costs and the interest incomes of different installments or interest expenses are calculated in light of the actual interest rates of the financial assets or financial liabilities (including a set of financial assets or financial liabilities). The actual interest rate refers to the interest rate adopted to cash the future cash flow of a financial asset or financial liability within the predicted term of existence or within a shorter applicable term into the current carrying amount of the financial asset orfinancial liability.
When the actual interest rate is determined, the future cash flow shall be predicted on the basis of taking into account all the contractual provisions concerning the financial asset or financial liability (the future credit losses shall not be taken into account).and also the various fee charges, trading expenses, premiums or reduced values, etc., which are paid or collected by the parties to a financial asset or financial liability contract and which form a part of the actual interest rate.
③Loans and theaccounts receivables
Loans and the accounts receivables refer to non-derivative financial assets, which there is no quotationin theactive market, withfixed recovery cost orrecognizable.
Financial assets that are defined as loans and the accounts receivables by the Group including notes receivables, accounts receivables, interest receivable, dividends receivable and other receivables etc..
2015Semi-annualReportofKonkaGroupCo.,Ltd. Loans and the accounts receivables are made follow-up measurement on the basis of post-amortization costs employing the effective interest method. Gains or loss arising from the termination recognition, impairment occurs or amortization shall be recorded into the profits andlosses ofthecurrent period.
④Assets available for sales
Assets available for sales including non-derivative financial asset that has been assigned as assets available for sales on the initial recognition and financial assets excluded those measured at fair value and of which the variation into profits and losses of the current period, they are somefinancial assets, loans and accounts receivables, held-to-maturity investment. The cost at the period-end of the available-for-sale liabilities instruments should be confirmed according to its amortized cost method, that is the initially recognized amount which deduct the principal that had been repaid, to plus or minus the accumulative amortization amount formed by the amortization between the difference of the initially recognized amount and the amount on the due date that adopted the actual interest rate method, and at the same time deduct the amount after the impairment loss happened. The cost at theperiod-end ofthe available-for-saleliabilities instrumentsis itsinitialcost.
Financial assets available-for-trade are subsequently measured at fair value, and gains or losses arising from changes in the fair value are recognized as other comprehensiveincome， and be carried forward when the said financial assets stopped recognition, then it shall be recorded into the profits and losses of the current period. But, the equity instrument investment which neither have quotation in the active market nor its fair value could not be reliable measured, as well as the derivative financial assets that concern with the equity instruments and should be settled through handing over to its equity instruments, should take thefollow-up measurement according tothe cost.
Interest receive during the holding of assets available for sales and cash dividends with distribution announcement by invested companies, it shall be recorded into the profits and losses ofthecurrent period.
(3)Impairment offinancial 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 indicatinga financial asset may be impaired, aprovision is provided for theimpairment. The Group carries out a separate impairment test for every financial asset which is individually significant. As for a financial asset which is individually insignificant, an impairment test is carried out separately or in the financial asset group with similar credit risk. Where the financial asset (individually significant or insignificant) is found not impaired after the separate impairment test, it is included in the financial asset group with similar credit risk and tested again on the group basis. Where the impairment loss is recognized for an individual financial asset, it is not included in the financial asset group with similar credit risk foran impairmenttest.
①Impairment onheld-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
2015Semi-annualReportofKonkaGroupCo.,Ltd. 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 provisionsof impairment lossonthe reserving date.
②Impairment ofavailable-for-sale financial assets
When it judged that the decrease of fair value of the available-for-sale equity instrument investment is serious and not temporarily after comprehensive considering relevant factors, it reflected that the available-for-sale equity instrument investment occurred impairment. Of which, the “serious decline” refers to the accumulative decline range of the fair value over20%; while the “non-temporary decline” refers to the consecutive decline time of the fair valueover 12months.
Where an available-for-sale financial asset is impaired, the accumulative losses arising from the decrease of the fair value of the capital reserve which is directly included are transferred out and recorded in the profits and losses for the current period. The accumulative losses transferred out are the balance obtained from the initially obtained cost of the said financial asset after deducting the principals as taken back, the amortized amount, the current fair valueand theimpairment lossoriginally recorded in theprofits andlosses.
Where the impairment loss has been recognized for an available-for-sale financial asset, if, within the accounting periods thereafter, there is any objective evidence proving that the value of the said financial asset has been restored and the restoration is objectively related to the events that occur after the impairment loss was recognized, the originally recognized impairment loss is reversed. The impairment losses on the available-for-sale equity instrument investments are reversed and recognized as other comprehensive incomes, and the impairment losses on the available-for-sale liability instruments are reversed and recorded in theprofits and losses for thecurrent period.
The impairment loss incurred to an equity instrument investment for which there is no quoted price in the active market and whose fair value cannot be reliably measured, or incurred to a derivative financial asset which is connected with the said equity instrument investment and which must besettled bydelivering thesaid equityinvestment, is not reversed.
(4)Recognition and measurement of financial asset transfers
Where a financial asset satisfies any of the following requirements, the recognition of it is terminated:① The contractual rights for collecting the cash flow of the said financial asset are terminated;② The said financial asset has been transferred and nearly all of the risks and rewards related to the ownership of the financial asset to the transferee; or③ The said financial asset has been transferred. And the Group has ceased its control on the said financial asset though it neither transfers nor retains nearly all of the risks and rewards related to theownership ofthe financial asset.
Where the Group neither transfers nor retains nearly all of the risks and rewards related to the ownership of a financial asset, and it does not cease its control on the said financial asset, it recognizes the relevant financial asset and liability accordingly according to the extent of its continuous involvement in the transferred financial asset. The term "continuous involvement in the transferred financial asset" refers to the risk level that the enterprise faces resulting from thechange of thevalueof thefinancial asset.
2015Semi-annualReportofKonkaGroupCo.,Ltd. If the transfer of an entire financial asset satisfies the conditions for stopping recognition, the difference between the amounts of the following 2 items is recorded in the profits and losses of the current period: (1) The book value of the transferred financial asset; and (2) The sum of consideration received from the transfer, and the accumulative amount of the changes of thefair valueoriginally recorded in othercomprehensiveincomes.
If the transfer of partial financial asset satisfies the conditions to stop the recognition, the book value of the transferred financial asset is apportioned between the portion whose recognition has been stopped and the portion whose recognition has not been stopped according to their respective relative fair value, and the difference between the amounts of the following 2 items is included into the profits and losses of the current period: (1) The summation of the consideration received from the transfer and the portion of the accumulative amount of changes in the fair value originally recorded in other comprehensive incomes which corresponds to the portion whose recognition has been stopped; and (2) The amortizedcarrying amountsof theaforesaid amounts.
In respect of the assets using recourse to sell or using endorsement to transfer, the Group needs to determine whether almost all of the risks and rewards of the financial asset ownership are transferred. If almost all of the risks and rewards of the financial asset ownership had been transferred to the transferee, derecognize the financial assets. For almost all of the risks and rewards of the financial asset ownership retained, do not end to recognize the financial assets. For which neither transfer or retain almost all of the risks and rewards of the financial asset ownership, continuously judge whether the Company retain the control of the assets, and conduct accounting treatment according to the principle of mentioned in the previous paragraphs.
(5)Classification and measurement offinancial liabilities
In the initial recognition, financial liabilities are divided into the financial liabilities measured at fair values and whose changes are recorded in current gains and losses and other financial liabilities. Financial liabilities are initially recognized at their fair values. As for a financial liability measured at fair value and whose changes are recorded in current gains and losses, the relevant trading expense is directly recorded in the profits and losses for the current period. As for other financial liabilities, the relevant trading expenses are recorded in the initially recognized amounts.
① Financial liabilities measured at fair values and whose changes are recorded in current gains andlosses
Such financial liabilities are divided into transactional financial liabilities and financial liabilities designated to be measured at fair values and whose changes are recorded in current gains and losses in the initial recognition under the same conditions where such financial assets are divided into transactional financial assets and financial assets designated to be measured at fair values and whose changes are recorded in current gains and losses in the initial recognition.
Financial liabilities measured at fair values and whose changes are recorded in current gains and losses are subsequently measured at their fair values. Gains or losses arising from the fair value changes, as well as the dividend and interest expenses in relation to the said financial liabilities, are recorded inthe profits and losses forthe current period.
②Otherfinancial liabilities
2015Semi-annualReportofKonkaGroupCo.,Ltd. As for a derivative financial liability connected to an equity instrument for which there is not quoted price in an active market and whose fair value cannot be reliably measured and which must be settled by delivering the equity instrument, it is subsequently measured on the basis of costs. Other financial liabilities are subsequently measured according to the amortized cost using the actual interest rate method. Gains or losses arising from de-recognition or amortization of the said financial liabilities is recorded in the profits and losses for the current period.
③Financial guaranteecontract and loan commitment
For the financial guarantee contracts which are not designated as a financial liability measured at its fair value and the variation thereof is recorded into the profits and losses of the current period, or the loan commitment which is not designated as a financial liability measured at its fair value and the variation thereof is recorded into the gains and losses that will be loaned lower than the market interest rate, which shall be initially recognized by fair value, and the subsequent measurement shall be made after they are initially recognized according to the higher one of the following: a. the amount as determined according to the Accounting Standards for Enterprises No. 13– Contingencies; b. the surplus after accumulative amortization as determined according to the principles of the Accounting Standards for Enterprises No. 14 - Revenues is subtracted from the initially recognized amount.
(6)De-recognition of financial liabilities
Only when the prevailing obligations of a financial liability are relieved in all or in part may the recognition of the financial liability be terminated in all or partly. Where the Group (debtor) enters into an agreement with a creditor so as to substitute the existing financial liabilities by way of any new financial liability, and if the contractual stipulations regarding the new financial liability is substantially different from that regarding the existing financial liability, it terminates the recognition of the existing financial liability, and at the same time recognizes thenew financial liability.
Where the recognition of a financial liability is totally or partially terminated, the enterprise concerned shall include into the profits and losses of the current period for the gap between the book value which has been terminated from recognition and the considerations it has paid (including the non-cash assets it has transferred out and the new financial liabilities it has assumed)
(7)Derivatives and embedded derivatives
Derivative financial instruments include derivatives are initially measured at fair value at the date when the derivative contracts are entered into and are substantially re-measured at fair value.The resulting gain and loss is recognized in profit or loss.
An embedded derivative is separated from the hybrid instrument, where the hybrid instrument is not designated as a financial asset or financial liability at fair value though profit or loss, and the treated as a standalone derivative if (a) the economic characteristics and risks of the embedded derivative are not closely related to the economic characteristics and risks of the host contract; and (b) a separate instrument with the same terms as the embedded derivative would meet the definition of a derivative. If the Company is unable to measure the embedded derivative separately either at acquisition or at a subsequent balance sheet date, it designates the entire hybrid instrument as a financial asset or financial liability at fair valuethrough profit or loss.
2015Semi-annualReportofKonkaGroupCo.,Ltd. (8)Offsetting financial assets and financial liabilities
When the Group 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 thebalance sheet andshall not beoffset.
(9)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 Group issues (including refinancing), re-purchases, sells or written-offs the equity instrument as the disposing of the changes of the equity. The Group not recognized the changes of the fair value of the equity instrument. The transaction expenses related to theequity transaction would bededucted from theequity. All types of distribution (excluding stock dividends) made by the Group to holders of equity instruments are deducted fromshareholders’ equity. The Group does not recognize any changes in thefair value ofequity instruments.
10.Receivables
Receivables includeaccount receivables and other accounts receivables.
(1)Recognition ofprovision for bad debts:
The Group shall test the carrying amount of receivables on the balance sheet date. Where there is any objective evidence proving that such receivables have been impaired, an impairment provision shallbemade.
①Debtorhas serious financial difficult;
② Debtor goes against the contract clause (for instance, breach of faith or overdue paying interests orprincipal);
③Debtors have agreat probability ofbankruptcy orother financial reorganization;
④Otherobjective evidence proving such accounts receivablehas been impaired;
(2)Withdraw method of provisionfor bad debts
① The recognition criteria and method of individual provision for bad debts of receivables thatare individually significant
The Group recognized the receivables with amount above RMB 20 million and other receivables above 10 million as receivables with significant single amounts and withdrawn theprovisionfor bad debts.
The Group made an independent impairment test on receivables with significant single amounts; the financial assets without impairment by independent impairment test should be included in financial assets portfolio with similar credit risk to take the impairment test. Receivables was recognized with impairment should no longer be included in receivables portfoliowith similarcredit risk to taketheimpairment test.
② The recognition and method of provision for bad debts of receivables by credit risk
2015Semi-annualReportofKonkaGroupCo.,Ltd. portfolio
A. Recognition ofcreditrisk group
Receivables that not individually significant and individually significant but without impairment by independent impairment test, are grouped on the basis of similarity and relevance of credit risk. This credit risk usually reflects thedebtor’s ability to repay all the due accounts in accordance with contract for such assets, which also are related with the measurement onfuturecash flowof theexaminedassets.
Recognition basicofdifferent groups:
Item Basic
Portfolio1:Aginggroup Divide the groups according to the credit risks characteristics of the accounts receivable
Portfolio 2:Internal related party Dividethegroupsaccordingtothecreditriskscharacteristicsofwhetherthecreditor groupsoftheCompany istheinternalrelatedpartyoftheCompany
B.Withdrawal method of provision forbad debts recognized bycredit risk group
For the impairment test implemented by groups, the amount of provision for bad debts was appraised and recognized in accordance with the structure of accounts receivable group and similar characteristics of credit risk (thedebtor’s ability to pay off the loans in accordance with the provisions of contract), experience of losses, current economic status and the predicted losses inthe accounts receivable group.
Withdrawal method ofthebad debts provisionofthe different groups:
Item Withdrawalmethod
Portfolio1:Aginggroup Aginganalysismethod
Portfolio2Internalrelatedpartygroups Executestheimpairmenttestindividuallyandifthereisnoimpairment,should oftheCompany notwithdrawthebaddebtprovision
In thegroups, adopting aging analysis method to withdraw bad debt provision:
||
|-|
|Withdrawalproportionforaccountsreceivable(%)|
|2|
|5|
|20|
|50|
|50|
|100|

③ Receivables with insignificant amount but being individually withdrawn the provision for
bad debts
The Group made independent impairment test on receivables with insignificant amount but
2015Semi-annualReportofKonkaGroupCo.,Ltd. with the following characteristics, if any objective evidence shows that the accounts receivable has been impaired, impairment loss shall be recognized on the basis of the gap between the current values of the future cash flow lower than its book value so as to withdrawprovision forbad debts:
A. Receivables have disputewiththeother parties or involvinglawsuit and arbitration;
B. Receivables have obvious indication showing that the debtors are likely to fail to perform thedutyof repayment, etc.
(3)Reversal ofprovision for baddebts
If there is any objective evidence proving that the value of the said receivables has been restored, and it is objectively related to the events occurred after such loss is recognized, the impairment-related losses as originally recognized shall be reversed and be recorded into the profits and losses of the current period. However, the reversed carrying amount shall not be any more than the post-amortization costs of the said accounts receivable on the day of reverseunder theassumption that no provisionis made forthe impairment.
11.Inventory
(1)Classification
TheGroup’s inventories are classified as non-property inventories and property inventories. And the non-property inventories include raw materials, goods in process; merchandise on hand, goods delivered and circulating materials, etc; while the property inventories include property inprocess and finished property,etc.
①Thefinished property refers tothe finished andheld-for-saleproperty.
② The property in process (development costs) refers to the unfinished property with the development purpose forsale.
(2)Pricing method foroutgoing inventories
Pricing method:weighted average method
The inventories shall be measured in light of their cost when obtained. The cost of inventory consists of purchase costs, processing costs and other costs. Inventory is accounted by weight average method upon receiving and giving. For merchandise on hand shall be accounted by planned cost, if the difference between planned cost of and actual cost of raw materials is accounted through the cost variance item, and the planned cost is adjusted to the actual cost according to the cost difference which the carryover and given-out inventory should shoulder intheperiod.
The property inventories are initially measured at the costs, and the costs of the developed property include the land premium, expenditures for supporting infrastructures, expenditures for construction and installation projects, the borrowing costs before the completion of the developed project and otherexpenses occurred during thedevelopment process.
① The public supporting facilities recorded the development costs at the actual costs, the amortization upon completion was transferred to the costs of houses and other available-for-sale property, while as for the supporting facilities with operating value and beneficiary rights owned by the Group as well as available for individual sale and measurement, which shall berecorded into the“investment property”
② For the accounting policies on borrowing costs occurred for developing property, please
2015Semi-annualReportofKonkaGroupCo.,Ltd. referto Note IV.17Pricing of“Borrowing Costs”.
(3) Recognition basis of net realizable value and withdrawal method of depreciation reserves forinventories
The net realizable value refers, in the ordinary course of business, to the account after deducting the estimated cost of completion, estimated sale expense and relevant taxes from the estimated sale price of inventories. The net realizable value of inventories shall be fixed on the basis of valid evidence as well as under consideration of purpose of inventories and theeffect of events after balance-sheet-date.
On the balance sheet date, the inventories shall be measured according to the cost or the net realizable value, whichever is lower. If the net realizable value is lower than the cost, it shall withdraw the depreciation reserves for inventories, which was withdrawn in accordance with thebalance that thecost of individual inventory item exceeding the net realizablevalue. After withdrawing the depreciation reserves for inventories, if the factors, which cause any write-down of the inventories, have disappeared, causing the net realizable value of inventories is higher than its carrying amount; the amount of write-down shall be reversed from the original amount of depreciation reserve for inventories. The reversed amount shall beincluded in theprofits and losses ofthecurrent period.
(4)The perpetual inventory system is maintained for stocksystem.
(5)Amortization method ofthelow-value consumption goods and packing articles
The low-value consumption goods should be amortized by one time amortization when acquiring and the packing articles are amortized by one time/gradation amortization when acquiring.
12.Long-term equityinvestments
The long-term equity investments of this part refer to the long-term equity investments that the Group has control, joint control or significant influence over the investees. The long-term equity investment that the Group does not have control, joint control or significant influence over the investees, should be recognized as available-for-sale financial assets or be measured by fair value with the changes should be included in the financial assets accounting of the current gains and losses, and please refer the details of the accounting policies to Notes IV 9 “financial instrument”.
Joint control, refers to the control jointly owned according to the relevant agreement on an arrangement by the Group and the relevant activities of the arrangement should be decided only after the participants which share the control right make consensus. Significant influence refers to the power of the Group which could anticipate in the finance and the operation polices of the investees, but could not control or jointly control the formulation of thepolicies with theotherparties.
(1)Recognition ofinvestment costs
As for long-term equity investments acquired by enterprise merger, if the merger is under the same control, the share of the book value of theowner’s equity of the merged enterprise, on the date of merger, is regarded as the initial cost of the long-term equity investment. The difference between the initial cost of the long-term equity investment and the payment in cash, non-cash assets transferred as well as the book value of the debts borne by the merging party shall offset against the capital reserve. If the capital reserve is insufficient to dilute, the retained earnings shall be adjusted. If the consideration of the merging enterprise is that it issues equity securities, it shall, on the date of merger, regard the share of the book value of the shareholder's equity of the merged enterprise on the consolidated financial statement of
2015Semi-annualReportofKonkaGroupCo.,Ltd. the ultimate control party as the initial cost of the long-term equity investment. The total face value of the stocks issued shall be regarded as the capital stock, while the difference between the initial cost of the long-term equity investment and total face value of the shares issued shall offset against the capital reserve. If the capital reserve is insufficient to dilute, the retained earnings shall be adjusted. The equities of the combined party which respectively acquired through multiple transaction under the same control that ultimately form into the combination of the enterprises under the same control, should be disposed according whether belongs to package deal; if belongs to package deal, each transaction would be executed accounting treatment by the Company as a transaction of acquiring the control right. If not belongs to package deal, it shall, on the date of merger, regard the enjoyed share of the book value of the shareholder's equity of the merged enterprise on the consolidated financial statement of the ultimate control party as the initial cost of the long-term equity investment, and as for the difference between the initial investment cost of the long-term equity investment and sum of the book value of the long-term equity investment before the combination and the book value of the consideration of the new payment that further required on the combination date, should adjust the capital reserve; if the capital reserve is insufficient to dilute, the retained earnings shall be adjusted. The equity investment held before the combination date which adopted the equity method for accounting, or the other comprehensive income confirmed for the available-for-sale financial assets, should not have any accounting disposal forthemoment.
For the long-term investment required from the business combination under different control, the initial investment cost regarded as long-term equity investment on the purchasing date according to the combination cost, the combination costs shall be the sum of the fair values of the assets paid, the liabilities incurred or assumed and the equity securities issued by the Company. The equities of the acquirees which respectively acquired through multiple transaction that ultimately form into the combination of the enterprises under the different control, should be disposed according whether belongs to package deal; if belongs to package deal, each transaction would be executed accounting treatment by the Company as a transaction of acquiring the control right. If not belongs to package deal, the sum of the book value of the original held equity investment of the acquirees and the newly added investment cost should be regarded as the initial investment cost of the long-term equity investment that changed to be accounted by cost method. If the original held equity is calculated by cost method, the other relevant comprehensive income would not have any accounting disposal for the moment. If the original held equity investment is the financial assets available for sale, its difference between the fair value and the book value as well as the accumulative changes of the fair value that include in the other comprehensive income, should transfer into the current gains andlosses.
The commission fees for audit, law services, assessment and consultancy services and other relevant expenses occurred in the business combination by the combining party or the purchase party, shall be recorded into current profits and losses upon their occurrence; the transaction expense from the issuance of equity securities or bonds securities which are as consideration for combination by the combining party, should be recorded as the initial amountof equity securities andbonds securities.
Besides the long-term equity investments formed by business combination, the other long-term equity investments shall be initially measured by cost, the cost is fixed in accordance with the ways of gaining, such as actual cash payment paid by the Group, the fair value of equity securities issued by the Group, the agreed value of the investment contract or
2015Semi-annualReportofKonkaGroupCo.,Ltd. agreement, the fair value or original carrying amount of exchanged assets from non-monetary assets exchange transaction, the fair value of the long-term equity investments, etc. The expenses, taxes and other necessary expenditures directly related with gaining the long-term equity investments shall also be recorded into investment cost. The long-term equity investment cost for those could execute significant influences on the investees because of appending the investment or could execute joint control but not form as control, should be as the sum of the fair value of the original held equity investment and the newly added investment cost recognized according to the No.22 of Accounting Standards for BusinessEnterprises—Recognition and Measurement ofFinancial Instrument.
(2)Subsequent measurement and recognition of gains or losses
A long-term equity investment where the investing enterprise has joint control (except for which forms into common operators) or significant influence over the investors should be measured by equity method. Moreover, long-term equity investment adopting the cost methodin thefinancial statements, and which theCompany has control oninvested entity.①Long-term equity investment measured byadopting cost method
The price of a long-term equity investment measured by adopting the cost method shall be included at its initial investment cost and append as well as withdraw the cost of investing and adjusting the long-term equity investment. The return on investment at current period shall be recognized in accordance with the cash dividend or profit announced to distribute by the invested entity, except the announced but not distributed cash dividend or profit included intheactual payment orconsideration upongainingthe investment.
②Long-term equity investment measured byadopting equity method
If the initial cost of a long-term equity investment is more than the Company's attributable share of the fair value of the invested entity's identifiable net assets for investment, the initial cost of the long-term equity investment may not be adjusted. If the initial cost of a long-term equity investment is less than the Company's attributable share of the fair value of the invested entity's identifiable net assets for investment, the difference shall be included in the current profits and losses and the cost of the long-term equity investment shall be adjusted simultaneously.
When measured by adopting equity method, respectively recognize investment income and other comprehensive income according to the net gains and losses as well as the portion of other comprehensive income which should be enjoyed or be shared, and at the same time adjust the book value of the long-term equity investment; corresponding reduce the book value of the long-term equity investment according to profits which be declared to distribute by the investees or the portion of the calculation of cash dividends which should be enjoyed; for the other changes except for the net gains and losses, other comprehensive income and theowners’equity except for the profits distribution of the investees, should adjust the book value of the long-term equity investment as well as include in the capital reserve. The investing enterprise shall, on the ground of the fair value of all identifiable assets of the invested entity when it obtains the investment, recognize the attributable share of the net profits and losses of the invested entity after it adjusts the net profits of the invested entity. If the accounting polices adopted by the investees is not accord with that of the Group, should be adjusted according to the accounting policies of the Group and the financial statement of the investees during the accounting period and according which to recognize the investment income as well as other comprehensive income. For the transaction happened between the
2015Semi-annualReportofKonkaGroupCo.,Ltd. Group and associated enterprises as well as joint ventures, if the assets launched or sold not form into business, the portion of the unrealized gains and losses of the internal transaction, which belongs to the Group according to the calculation of the enjoyed proportion, should recognize the investment gains and losses on the basis. But the losses of the unrealized internal transaction happened between the Group and the investees which belongs to the impairment losses of the transferred assets, should not be neutralized. The assets launched by the Group to the associated enterprises or the joint ventures if could form into business, the long-term equity investment without control right which acquired by the investors, should regard the fair value of the launched business as the initial investment cost the newly added long-term equity investment, and for the difference between the initial investment cost and the book value of the launched business, should be included into the current gains and losses with full amount. The assets sold by the Group to the associated enterprises or the joint ventures if could form into business, the difference between the acquired consideration and the book value of the business should be included in the current gains and losses with full amount. The assets purchased by the Group to the associated enterprises or the joint ventures ifcould form into business, should be accounting disposed according to the regulations of No. 20ofASBE—Business Combination, and should be recognized gains or losses related to the transaction with full amount.
The Group shall recognize the net losses of the invested enterprise until the book value of the long-term equity investment and other long-term rights and interests which substantially form the net investment made to the invested entity are reduced to zero. However, if the Group has the obligation to undertake extra losses, it shall be recognized as the estimated liabilities in accordance with the estimated duties and then recorded into investment losses at current period. If the invested entity realizes any net profits later, the Group shall, after the amount of its attributable share of profits offsets against its attributable share of the un-recognizedlosses, resumerecognizingits attributableshare ofprofits.
For the long-term equity investment held by the Group before the first execution of the new accounting criterion on 1 Jan. 2008 of the associated enterprises and joint ventures, if there is debit difference of the equity investment related to the investment, should be included in the current gains and losses according to the amount of the straight-line amortization during the original remained period.
③Acquiring shares of minorityinterest
In the preparation for the financial statements, the balance existed between the long-term equity investment increased by acquiring shares of minority interest and the attributable net assets on the subsidiary calculated by the increased shares held since the purchase date (or combination date), the capital reserves shall be adjusted, if the capital reserves are not sufficientto offset, theretained profits shall be adjusted.
④Disposal oflong-term equity investment
In the preparation of financial statements, the Company disposed part of the long-term equity investment on subsidiaries without losing its controlling right on them, the balance between the disposed price and attributable net assets of subsidiaries by disposing the long-term equity investment shall be recorded intoowners’ equity; where the Company losses the controlling right by disposing part of long-term equity investment on such subsidiaries, it shall treated in accordance with the relevant accounting policies in Note IV. 5 (2)— Method onpreparation ofcombined financial statements.
2015Semi-annualReportofKonkaGroupCo.,Ltd. For other ways on disposal of long-term equity investment, the balance between the book value of the disposed equity and its actual payment gained shall be recorded into current profits andlosses.
For the long-term equity investment measured by adopting equity method, if the remained equity after disposal still adopts the equity method for measurement, the other comprehensive income originally recorded intoowners’ equity should adopt the same basis of the accounting disposal of the relevant assets or liabilities directly disposed by the investees according to the corresponding proportion. Theowners’equity recognized owning to the changes of the otherowners’ equity except for the net gains and losses, other comprehensive income and the profits distribution of the investees, should be transferred into thecurrent gains andlosses according tothe proportion.
For the long-term equity investment which adopts the cost method of measurement, if the remained equity still adopt the cost method, the other comprehensive income recognized owning to adopting the equity method for measurement or the recognition and measurement standards of financial instrument before acquiring the control of the investees, should adopt the same basis of the accounting disposal of the relevant assets or liabilities directly disposed by the investees and should be carried forward into the current gains and losses according to the proportion; the changes of the otherowners’ equity except for the net gains and losses, other comprehensive income and the profits distribution among the net assets of the investees which recognized by adopting the equity method for measurement, should be carried forward intothecurrent gainsand losses according to theproportion.
For those the Group lost the control of the investees by disposing part of the equity investment as well as the remained equity after disposal could execute joint control or significant influences on the investees, should change to measure by equity method when compiling the individual financial statement and should adjust the measurement of the remained equity to equity method as adopted since the time acquired; if the remained equity after disposal could not execute joint control or significant influences on the investees, should change the accounting disposal according to the relevant regulations of the recognition and measurement standards of financial instrument, and its difference between the fair value and book value on the date lose the control right should be included in the current gains and losses. For the other comprehensive income recognized by adopting equity method for measurement or the recognition and measurement standards of financial instrument before the Group acquired the control of the investees, should execute the accounting disposal by adopting the same basis of the accounting disposal of the relevant assets or liabilities directly disposed by the investees when lose the control of them, while the changes of the otherowners’equity except for the net gains and losses, other comprehensive income and the profits distribution among the net assets of the investees which recognized by adopting the equity method for measurement, should be carried forward into the current gains and losses according to the proportion. Of which, for the disposed remained equity which adopted the equity method for measurement, the other comprehensive income and the otherowners’equity should be carried forward according to the proportion; for the disposed remained equity which changed to execute the accounting disposal according to the recognition and measurement standards of financial instrument, the other comprehensive incomeandtheotherowners’equity shouldbe carried forward in fullamount.
For those the Group lost the control of the investees by disposing part of the equity investment, the disposed remained equity should change to calculate according to the recognition and measurement standards of financial instrument, and difference between the
2015Semi-annualReportofKonkaGroupCo.,Ltd. fair value and book value on the date lose the control right should be included in the current gains and losses. For the other comprehensive income recognized from the original equity investment by adopting the equity method, should execute the accounting disposal by adopting the same basis of the accounting disposal of the relevant assets or liabilities directly disposed by the investees when terminate the equity method for measurement, while for theowners’equity recognized owning to the changes of the otherowner’s equity except for the net gains and losses, other comprehensive income and the profits distribution of the investees, should be transferred into the current investment income with full amount when terminate adoptingthe equitymethod.
The Group respectively disposes the equity investment of the subsidiaries through multiple transactions until lose the control right, if the above transactions belongs to the package deal, should execute the accounting disposal by regarding each transaction as a deal of disposing the equity investment of the subsidiaries until lose the control right, while the difference between each expenses of the disposal and the book value of the long-term equity investment in accord with the disposed equity before losing the control right, should firstly be recognized as other comprehensive income then be transferred into the current gains and losses oflosingthe control right along untilthetimewhen loseit.
13.Investmentreal estates
The term “investment real estates” refers to the real estate held for generating rent and/or capital appreciation. Investment real estates of the Group include the right to use any land which has already been rented; the right to use any land which is held and prepared for transfer after appreciation; and theright touseany buildingwhich has already been rented. The initial measurement of the investment real estate shall be made at its cost. Subsequent expenditures incurred for an investment real estate is included in the cost of the investment real estate when it is probable that economic benefits associated with the investment real estate will flow to the Group and the cost can be reliably measured, otherwise the expenditureis recognized in profit orloss in theperiod in which they are incurred.
The Group shall make a follow-up measurement to the investment real estates by employing the cost pattern on the date of the balance sheet.An accrual depreciation or amortization shall be made for the investment real estates in the light of the accounting policies of the use right ofbuildings or lands.
For details of impairment test method and withdrawal method of impairment provision of investment real estates, please refer to Note IV. 16. Impairment of Non-current Non-financial Assets.
When owner-occupied real estate or inventories are changed into investment real estate or investment real estate is changed into owner-occupied real estate, of which book value prior tothechange shallbe theentry valueafter the change.
When an investment real estate is changed to an owner-occupied real estate, it would be transferred to fixed assets or intangible assets at the date of such change. When an owner-occupied real estate is changed to be held to earn rental or for capital appreciation, the fixed asset or intangible asset is transferred to investment real estate at the date of such change. If the fixed asset or intangible asset is changed into investment real estate measured by adopting the cost pattern, whose book value prior to the change shall be the entry value after the change; if the fixed asset or intangible asset is changed into investment real estate measured by adopting the fair value pattern, whose fair value on the date of such change shall betheentry valueafter thechange
2015Semi-annualReportofKonkaGroupCo.,Ltd. An investment real estate is derecognized on disposal or when the investment real estate is permanently withdrawn from use and no future economic benefits are expected from its disposal. The amount of proceeds on sale, transfer, retirement or damage of an investment real estate less its carrying amount and related taxes and expenses is recognized in profit or lossin theperiod in which it isincurred.
14.Fixed assets
(1)Conditionsfor recognition of fixed assets
The term "fixed assets" refers to the tangible assets that simultaneously possess the features as follows: (a) they are held for the sake of producing commodities, rendering labor service, renting or business management; and (b) their useful life is in excess of one fiscal year. The fixed assets are only recognized when the relevant economic benefits probably flow in the Group and its cost could be reliable measured. The fixed assets should take the initial measurement according to the cost and at the same time consider the influences of the factors oftheestimated discard expenses.
(2)Depreciation methodsof each fixed asset
The fixed assets should be withdrawn and depreciation by straight-line depreciation within the useful life since the next month when the fixed assets reach the estimated available state. The useful life, estimated net salvage and the yearly discounted rate of each fixed asset are as follows:
||||
|-|-|-|
|Method|Usefullife(Year)|Expectednetsalvagevalue(%)|
|Straight-linedepreciation|20-40|10.00|
|Straight-linedepreciation|10|10.00|
|Straight-linedepreciation|5|10.00|
|Straight-linedepreciation|5|10.00|
|Straight-linedepreciation|5|10.00|

The “expected net salvage value” refers to the expected amount that the Group may obtain from the current disposal of a fixed asset after deducting the expected disposal expenses at theexpirationof itsexpected useful life.
(3) Testing method of impairment and withdrawal method of provision for impairment on fixed assets
For details of the testing method of impairment and withdraw method of impairment
provision for impairment on fixed assets, please refer to Note IV. 19 “Long-term assets
impairment”.
2015Semi-annualReportofKonkaGroupCo.,Ltd. (4)Recognition basis, pricing and depreciation method offixed assets byfinance lease
The “finance lease” shall refer to a lease that has transferred in substance all the risks and rewards related to the ownership of an asset. Its ownership may or may not eventually be transferred. The fixed assets by finance lease shall adopt the same depreciation policy for self-owned fixed assets. If it is reasonable to be certain that the lessee will obtain the ownership of the leased asset when the lease term expires, the leased asset shall be fully depreciated over its useful life. If it is not reasonable to be certain that the lessee will obtain the ownership of the leased asset at the expiry of the lease term, the leased asset shall be fully depreciated over theshorter oneof thelease term orits useful life.
(5)Other explanations
The follow-up expenses related to a fixed asset, if the economic benefits pertinent to this fixed asset are likely to flow into the enterprise and its cost can be reliably measured, shall be recorded into cost of fixed assets and ultimately recognized as the book value of the replaced part; otherwise, they shall beincluded in thecurrent profits andlosses.
Terminate to recognize the fixed assets when the fixed assets under the disposing state or be estimated that could not occur any economy benefits through using or disposing. When the Group sells, transfers or discards any fixed assets, or when any fixed assets of the Group is damaged or destroyed, the Group shall deduct the book value of the fixed assets as well as the relevant taxes from the disposal income, and include the amount in the current profits and losses.
The Group shall check the useful life, expected net salvage value and depreciation method of the fixed assets at the end of the year at least, if there is any change, it shall be regarded as a change oftheaccounting estimates.
15.Construction inprogress
Construction in process is measured at actual cost. Actual cost comprises construction costs, borrowing costs that are eligible for capitalization before the fixed assets being ready for their intended us and other relevant costs. Construction in process is transferred to fixed assets when theassets are ready for theirintended use.
For details of the testing method of impairment and withdraw method of impairment provision on construction in progress, please refer to Note IV. 19 “Long-term assets impairment”.
16.Borrowingcosts
The borrowing costs shall include interest on borrowings, amortization of discounts or premiums on borrowings, ancillary expenses, and exchange balance on foreign currency borrowings. When the borrowing costs can be directly attributable to the construction or production of assets eligible for capitalization, and the asset disbursements or the borrowing costs have already incurred, and the construction or production activities which are necessary to prepare the asset for its intended use or sale have already started, the capitalization of borrowing costs begins. When the asset eligible for capitalization under acquisition and construction or production is ready for the intended use or sale, the capitalization of the borrowing costs shall be ceased. Other borrowing costs shall be recognized as expenses when incurred.
The to-be-capitalized amount of interests shall be determined in light of the actual interests incurred of the specially borrowed loan at the present period minus the income of interests earned on the unused borrowing loans as a deposit in the bank or as a temporary investment;
2015Semi-annualReportofKonkaGroupCo.,Ltd. the enterprise shall calculate and determine the to-be-capitalized amount on the general borrowing by multiplying the weighted average asset disbursement of the part of the accumulative asset disbursements minus the general borrowing by the capitalization rate of the general borrowing used. The capitalization rate shall be calculated and determined in light ofthe weighted average interest rate ofthe general borrowing.
During the period of capitalization, the exchange balance on foreign currency special borrowings shall be capitalized; the exchange balance on foreign currency general borrowings shall be recorded into current profits and losses.
The term “assets eligible for capitalization” refers to the fixed assets, investment real estate, inventories and other assets, of which the acquisition and construction or production may takequitea longtimeto get ready for itsintended useorforsale.
Where the acquisition and construction or production of a qualified asset is interrupted abnormally and the interruption period lasts for more than 3 months, the capitalization of the borrowing costs shall besuspended.
17.Intangibleassets
(1)Pricing method, useful life and impairment test
The term “intangible asset” refers to the identifiable non-monetary assets possessed or controlled byenterprises which havenophysical shape.
The intangible assets shall be initially measured according to its cost. The costs related with the intangible assets, if the economic benefits related to intangible assets are likely to flow into the enterprise and the cost of intangible assets can be measured reliably, shall be recorded into the costs of intangible assets; otherwise, it shall be recorded into current profits and losses upontheoccurrence.
The use right of land gained is usually measured as intangible assets. For the self-developed and constructed factories and other constructions, the related expenditures on use right of land and construction costs shall be respectively measured as intangible assets and fixed assets. For the purchased houses and buildings, the related payment shall be distributed into the payment for use right of land and the payment for buildings, if it is difficult to be distributed,thewhole payment shall betreated as fixedassets.
For intangible assets with a finite service life, from the time when it is available for use, the cost after deducting the sum of the expected salvage value and the accumulated impairment provision shall be amortized by straight line method during the service life. While the intangibleassets without certain service lifeshall not beamortized.
At the end of period, the Group shall check the service life and amortization method of intangible assets with finite service life, if there is any change, it shall be regarded as a change of the accounting estimates. Besides, the Group shall check the service life of intangible assets without certain service life, if there is any evidence showing that the period of intangible assets to bring the economic benefits to the enterprise can be prospected, it shall be estimated the service life and amortized in accordance with the amortization policies for intangibleassets with finiteservice life.
(2)R& Dexpenses
The expenditures for internal research and development projects of an enterprise shall be classified into research expenditures and development expenditures.
Theresearch expenditures shall berecorded into theprofit orloss forthe current period. The development expenditures shall be confirmed as intangible assets when they satisfy the
2015Semi-annualReportofKonkaGroupCo.,Ltd. following conditions simultaneously, and shall be recorded into profit or loss for the current period when theydon’t satisfy thefollowing conditions.
①It isfeasibletechnically to finish intangibleassets foruse orsale;
②It isintended tofinish and use orsell theintangible assets;
③ The usefulness of methods for intangible assets to generate economic benefits shall be proved, including being able to prove that there is a potential market for the products manufactured by applying the intangible assets or there is a potential market for the intangibleassets itselfortheintangible assets will beused internally;
④ It is able to finish the development of the intangible assets, and able to use or sell the intangible assets, with the support of sufficient technologies, financial resources and other resources;
⑤Thedevelopment expenditures oftheintangible assets can be reliably measured.
As for expenses thatcan’t be identified as research expenditures or development expenditures, theoccurred R& Dexpenses shall be all included in current profits and losses. (3) Testing method of impairment and withdraw method of impairment provision of intangibleassets
For details of the testing method of impairment and withdraw method of impairment provisiononintangible assets, seeNotes IV.19“Long-term assets impairment”.
18.Amortization method oflong-term deferred expenses
Long-term deferred expenses refer to general expenses with the apportioned period over one year (one year excluded) that have occurred but attributable to the current and future periods. Long-term deferred expenseshall be amortizedaveragely within benefit period.
19.Impairmentoflong-term assets
For non-current financial Assets of fixed Assets, projects under construction, intangible Assets with limited service life, investing real estate with cost model, long-term equity investment of subsidiaries, cooperative enterprises and joint ventures, the Group should judge whether decrease in value exists on the date of balance sheet. Recoverable amounts should be tested for decrease in value if it exists. Other intangible Assets of reputation and uncertain service life and other non-accessible intangible assets should be tested for decrease invalue nomatterwhether it exists.
If the recoverable amount is less than book value in impairment test results, the provision for impairment of differences should include in impairment loss. Recoverable amounts would be the higher of net value of asset fair value deducting disposal charges or present value of predicted cash flow.Asset fair value should be determined according to negotiated sales price of fair trade. If no sales agreement exists but with asset active market, fair value should be determined according to theBuyer’s price of the asset. If no sales agreement or asset active market exists, asset fair value could be acquired on the basis of best information available. Disposal expenses include legal fees, taxes, cartage or other direct expenses of merchantable Assets related to asset disposal. Present value of predicted asset cash flow should be determined by the proper discount rate according toAssets in service and predicted cash flow
2015Semi-annualReportofKonkaGroupCo.,Ltd. of final disposal. Asset depreciation reserves should be calculated on the basis of single Assets. If it is difficult to predict the recoverable amounts for single Assets, recoverable amounts should be determined according to the belonging asset group. Asset group is the minimum asset combination producing cash flowindependently.
In impairment test, book value of the business reputation in financial report should be shared to beneficial asset group and asset group combination in collaboration of business merger. It is shown in the test that if recoverable amounts of shared business reputation asset group or asset group combination are lower than book value, it should determine the impairment loss. Impairment loss amount should firstly be deducted and shared to the book value of business reputation of asset group or asset group combination, then deduct book value of all assets according to proportions of other book value of above assets in asset group or asset group combinationexcept businessreputation.
After the asset impairment loss is determined, recoverable value amounts would not be returned in future.
20.Employee compensation
Employee compensation of the Company mainly includes short-term employee compensation, departure benefits, demission benefits and other long-term employee compensation. Of which:
Short-term compensation mainly including salary, bonus, allowances and subsidies, employee services and benefits, medical insurance premiums, birth insurance premium, industrial injury insurance premium, housing fund, labor union expenditure and personnel education fund, non-monetary benefits etc. The short-term compensation actually happened during the accounting period when the active staff offering the service for the Group should be recognized as liabilities and is included in the current gains and losses or relevant assets cost. Ofwhich thenon-monetary benefits should bemeasured according tothe fairvalue. Welfare after demission mainly includes setting drawing plan. Defined contribution plans include basic endowment insurance, unemployment insurance and annuity. Deposited amounts are charged to relevant asset costs or current profits and losses during the period in which they are incurred. Defined benefit plan of the Company is internal early retirement plan. According to anticipated accumulative welfare unit, the Company makes estimates by unbiased and consistent actuarial assumption for the demographic variables and financial variables, measures the obligations produced in defined benefit plans, and determines the vesting period. On balance sheet date, the Company will list all obligations in defined benefit plans as present value and include current service costs into current profits and losses.
When terminating labor relations before expiration of contract, or layoffs with compensations, and the Company can not terminate the labor relations unilaterally or reduce the dimission welfare, remuneration and liabilities produced from the dimission welfare should be determined and included in current profits and losses when determining the costs of dismission welfare and recombination. However, dimission welfare not fully paid within 12 months after annual report period should be handled the same as other long-termemployees’ payrolls.
The inside employee retirement plan is treated by adopting the same principle with the above dismiss ion welfare. The group would recorded the salary and the social security insurance fees paid and so on from theemployee’s service terminative date to normal retirement date into current profits and losses (dismiss ion welfare) under the condition that they meet the
2015Semi-annualReportofKonkaGroupCo.,Ltd. recognition conditionsof estimated liabilities.
The other long-term welfare that the Group offers to the staffs, if met with the setting drawing plan, should be accounting disposed according to the setting drawing plan, while the rest should bedisposed according to thesetting revenueplan.
21.Estimated liabilities
The company should recognize the related obligation as a provision for liability when the obligation meets the following conditions: (1) That obligation is a present obligation of the enterprise; (2) It is probable that an outflow of economic benefits from the enterprise will be required to settle the obligation; (3) A reliable estimate can be made of the amount of the obligation.
On the balance sheet date, an enterprise shall take into full consideration of the risks, uncertainty, time value of money, and other factors pertinent to the Contingencies to measure the estimated liabilities in accordance with the best estimate of the necessary expenses for the performance ofthecurrent obligation.
When all or some of the expenses necessary for the liquidation of an estimated liabilities of an enterprise is expected to be compensated by a third party, the compensation should be separately recognized as an asset only when it is virtually certain that the reimbursement will be obtained. Besides, the amount recognized for the reimbursement should not exceed the bookvalueoftheestimated liabilities.
22.Revenue
(1)Revenue from sellinggoods
No revenue from selling goods may be recognized unless the following conditions are met simultaneously: the significant risks and rewards of ownership of the goods have been transferred to the buyer by the enterprise; the enterprise retains neither continuous management right that usually keeps relation with the ownership nor effective control over the sold goods; the relevant amount of revenue can be measured in a reliable way; the relevant economic benefits may flow into the enterprise; and the relevant costs incurred or to beincurred can bemeasured ina reliableway.
The recognition of revenue from commodities for the home market when shipping the goods: for good exported by way of FOB, the revenue shall be recognized once the goods were delivered to the carrier designated by the purchaser; for goods exported by way of CIF, the revenue shall berecognized once thegoods reach theport of thepurchase.
(2)Providing laborservices
If the Group can reliably estimate the outcome of a transaction concerning the labor services it provides, it shall recognize the revenue from providing services employing the percentage-of-completion method on the date of the balance sheet. The completed proportion of a transaction concerning the providing of labor services shall be decided by the proportion ofthelabor service already provided tothe totallaborservice toprovide.
The outcome of a transaction concerning the providing of labor services can be measured in a reliable way, means that the following conditions shall be met simultaneously:① The amount of revenue can be measured in a reliable way;② The relevant economic benefits are likely to flow into the enterprise;③ The schedule of completion under the transaction can be
2015Semi-annualReportofKonkaGroupCo.,Ltd. confirmed in a reliable way; and④ The costs incurred or to be incurred in the transaction can bemeasured in areliable way.
If the outcome of a transaction concerning the providing of labor services cannot be measured in a reliable way, the revenue from the providing of labor services shall be recognized in accordance with the amount of the cost of labor services incurred and expected to be compensated, and make the cost of labor services incurred as the current expenses. If it is predicted that the cost of labor services incurredcouldn’t be compensated, thus no revenue shall berecognized.
Where a contract or agreement signed between Group and other enterprises concerns selling goods and providing of labor services, if the part of sale of goods and the part of providing labor services can be distinguished from each other and can be measured respectively, the part of sale of goods and the part of providing labor services shall be treated respectively. If the part of selling goods and the part of providing labor services can not be distinguished from each other, or if the part of sale of goods and the part of providing labor services can be distinguished from each other but can not be measured respectively, both parts shall be conducted as selling goods.
(3)Recognition method ofthe sales revenues of real estate
The Group had signed the sales contract with the real estate had completed and be examined qualified, and reached the referable using conditions agreed by the sales contract as well as at the same time the housing accounts had been recognized the realize of the sales revenues when received with fullamount according to thesales contract.
(4)Royalty revenue
In accordance with relevant contract or agreement, the amount of royalty revenue should be recognized as revenue onaccrual basis.
(5)Interest revenue
The amount of interest revenue should be measured and confirmed in accordance with the length of time for which theGroup’s monetary fund is used by others and the agreed interest rate.
(6)Property leasing revenue
For therecognition method oftheproperty leasing revenue, please refer toNotes IV.25. 23.Government subsidies
A government subsidy means the monetary or non-monetary assets obtained free by the Group from the government, but excluding the capital invested by the government as the owner of the enterprise. Government subsidies consist of the government subsidies pertinent toassets andgovernment subsidiespertinent to income.
If a government subsidy is a monetary asset, it shall be measured in the light of the received or receivable amount. If a government subsidy is a non-monetary asset, it shall be measured at its fair value. If its fair value cannot be obtained in a reliable way, it shall be measured at its nominal amount. The government subsidies measured at their nominal amounts shall be directly included in thecurrent profits andlosses.
The government subsidies pertinent to assets shall be recognized as deferred income, equally distributed within the useful lives of the relevant assets, and included in the current profits and losses. The government subsidies pertinent to incomes shall be treated respectively in accordance with the circumstances as follows: those subsidies used for compensating the
2015Semi-annualReportofKonkaGroupCo.,Ltd. related future expenses or losses of the enterprise shall be recognized as deferred income and shall included in the current profits and losses during the period when the relevant expenses are recognized; or those subsidies used for compensating the related expenses or losses incurred to theenterprise shall bedirectly included in thecurrent profits and losses.
Where it is necessary to refund any government subsidy which has been recognized, it shall be treated respectively in accordance with the circumstances as follows: if there is the deferred income concerned, the book balance of the deferred income shall be offset against, but the excessive part shall be included in the current profits and losses; or if there is no deferred income concerned to the government subsidy, it shall be directly included in the current profits andlosses.
24.Deferredincometax assets/deferredincome tax liabilities
(1)Income tax ofthe current period
On the balance sheet date, for the current income tax liabilities (or assets) of the current period as well as the part formed during the previous period, should be measured by the income tax of the estimated payable (returnable) amount which be calculated according to the regulations of the tax law. The amount of the income tax payable which is based by the calculation of the current income tax expenses, are according to the result measured from the corresponding adjustment of the pre-tax accounting profit of 2014 which in accord to the relevantregulations ofthetax law.
(2)Deferred income tax assets and deferred incometax liabilities
The difference between the book value of certain assets and liabilities and their tax assessment basis, as well as the temporary difference occurs from the difference between the book value of the items which not be recognized as assets and liabilities but could confirm their tax assessment basis according to the regulations of the tax law, the deferred income tax assets and the deferred income tax liabilities should be recognized by adopting liabilities law ofthebalance sheet.
No deferred tax liability is recognized for a temporary difference arising from the initial recognition of goodwill, the initial recognition of assets or liabilities due to a transaction other than a business combination, which affects neither accounting profit nor taxable profit (or deductible loss). Besides, no deferred tax assets is recognized for the taxable temporary differences related to the investments of subsidiary companies, associated enterprises and joint enterprises, and the investing enterprise can control the time of the reverse of temporary differences as well as the temporary differences are unlikely to be reversed in the excepted future. Otherwise, the Group should recognize the deferred income tax liabilities arising form othertaxabletemporary difference.
No deferred taxable assets should be recognized for the deductible temporary difference of initial recognition of assets and liabilities arising from the transaction which is not business combination, the accounting profits will not be affected, nor will the taxable amount or deductible loss be affected at the time of transaction. Besides, no deferred taxable assets should be recognized for the deductible temporary difference related to the investments of the subsidiary companies, associated enterprises and joint enterprises, which are not likely to be reversed in the expected future or is not likely to acquire any amount of taxable income tax that may be used for making up such deductible temporary differences. Otherwise, the Company shall recognize the deferred income tax assets arising from a deductible temporary difference basing on the extent of the amount of the taxable income that is likely to be acquired tomake upsuch deductible temporary differences
2015Semi-annualReportofKonkaGroupCo.,Ltd. For any deductible loss or tax deduction that can be carried forward to the next year, the corresponding deferred income tax asset shall be determined to the extent that the amount of future taxable income to be offset by the deductible loss or tax deduction to be likely obtained.
On the balance sheet date, the deferred income tax assets and the deferred income tax liabilities shall be measured at the tax rate applicable to the period during which the assets areexpected to berecovered orthe liabilities are expected to be settled.
The book value of deferred income tax assets shall be reviewed at each balance sheet date. If it is unlikely to obtain sufficient taxable income to offset against the benefit of the deferred income tax asset, the book value of the deferred income tax assets shall be written down.Any such write-down should be subsequently reversed where it becomes probable that sufficient taxableincome willbe available.
(3)Income tax expenses
Incometax expenses includecurrent incometax and deferred income tax.
The rest current income tax and the deferred income tax expenses or revenue should be included into current gains and losses except for the current income tax and the deferred income tax related to the transaction and events that be confirmed as other comprehensive income or be directly included in theshareholders’equity which should be included in other comprehensive income orshareholders’ equity as well as the book value for adjusting the goodwillof thedeferred incometax occurs from thebusinesscombination.
(4)Offset of incometax
The current income tax assets and liabilities of the Group should be listed by the written-off net amount which intend to executes the net amount settlement as well as the assets acquiring and liabilities liquidation at the same time while owns the legal rights of settling the net amount.
The deferred income tax assets and liabilities of the Group should be listed as written-off net amount when having the legal rights of settling the current income tax assets and liabilities by net amount and the deferred income tax and liabilities is relevant to the income tax which be collected from the same taxpaying bodies by the same tax collection and administration department or is relevant to the different taxpaying bodies but during each period which there is significant reverse of the deferred income assets and liabilities in the future and among which the involved taxpaying bodies intend to settle the current income tax and liabilities by net amount orare at thesame timeacquire theasset as well as liquidatetheliabilities.
25.Leasing
Financing leasing virtually transferred the whole risks and leasing of the compensation related to the assets ownership and their ownership may eventually be transferred or maybe not.Other leasing except for thefinancing leasing is operating leasing.
(1)Business ofoperating leases recorded bythe Group as thelessee
The rent expenses from operating leases shall be recorded by the lessee in the relevant asset costs or the profits and losses of the current period by using the straight-line method over each period of the lease term. The initial direct costs shall be recognized as the profits and losses of the current period. The contingent rents shall be recorded into the profits and losses ofthecurrent period inwhich they actually arise.
(2)Business ofoperating leases recorded bythe Group as thelessor
The rent incomes from operating leases shall be recognized as the profits and losses of the
2015Semi-annualReportofKonkaGroupCo.,Ltd. current period by using the straight-line method over each period of the lease term. The initial direct costs of great amount shall be capitalized when incurred, and be recorded into current profits and losses in accordance with the same basis for recognition of rent incomes over the whole lease term. The initial direct costs of small amount shall be recorded into current profits and losses when incurred. The contingent rents shall be recorded into the profits andlosses ofthecurrent period in which they actually arise.
(3)Business offinance leases recorded bytheGroup as thelessee
On the lease beginning date, the Group shall record the lower one of the fair value of the leased asset and the present value of the minimum lease payments on the lease beginning date as the entering value in an account, recognize the amount of the minimum lease payments as the entering value in an account of long-term account payable, and treat the balance between the recorded amount of the leased asset and the long-term account payable as unrecognized financing charges. Besides, the initial direct costs directly attributable to the leased item incurred during the process of lease negotiating and signing the leasing agreement shall be recorded in the asset value of the current period. The balance through deducting unrecognized financing charges from the minimum lease payments shall be respectively stated in long-term liabilities and long-term liabilities due within1year.
Unrecognized financing charges shall be adopted by the effective interest rate method in the lease term, so as to calculate and recognize current financing charges. The contingent rents shall berecorded intotheprofits and losses ofthecurrent period inwhich they actually arise. (4)Business offinance leases recorded bytheGroup as thelessor
On the beginning date of the lease term, the Group shall recognize the sum of the minimum lease receipts on the lease beginning date and the initial direct costs as the entering value in an account of the financing lease values receivable, and record the unguaranteed residual value at the same time. The balance between the sum of the minimum lease receipts, the initial direct costs and the unguaranteed residual value and the sum of their present values shall be recognized as unrealized financing income. The balance through deducting unrealized financing incomes from the finance lease accounts receivable shall be respectively stated in long-term claims andlong-term claims duewithin 1year.
Unrecognized financing incomes shall be adopted by the effective interest rate method in the lease term, so as to calculate and recognize current financing revenues. The contingent rents shall berecorded intotheprofits and losses ofthecurrent period inwhich they actually arise. 26.Changesin mainaccounting policies andestimates
(1)Changeof accounting policies
There was noany change ofaccounting policies oftheCompany in thereporting period. (2)Changeof accounting estimates
There was noany change ofaccounting estimateoftheCompany in thereporting period. 27.Critical accounting judgments andestimates
Due to the inside uncertainty of operating activity, the Group needed to make judgments, estimates and assumption on the book value of the accounts without accurate measurement during the employment of accounting policies. And these judgments, estimates and assumption were made basing on the prior experience of the senior executives of the Group, as well as in consideration of other factors. These judgments, estimates and assumption would also affect the report amount of income, costs, assets and liabilities, as well as the disclosure of contingent liabilities on balance sheet date. However, the uncertainty of these
2015Semi-annualReportofKonkaGroupCo.,Ltd. estimates was likely to cause significant adjustment on the book value of the affected assets and liabilities.
The Group would check periodically the above judgments, estimates and assumption on the basis of continuing operation. For the changes in accounting estimates only affected on the current period, the influence should be recognized at the period of change occurred; for the changes in accounting estimates affected the current period and also the future period, the influenceshould be recognized at theperiod ofchange occurred and future period.
On the balance sheet date, the Group needed to make judgments, estimates and assumption ontheaccountsin thefollowing importantitems:
(1)Categorization ofleasing
In accordance with Accounting Standards for Enterprises No. 21– Leasing, the Group categorized the leasing into operating lease and finance lease. During the categorization, the management level needed to make analysis and judgment on whether all the risk and compensation related with the leased assets had been transferred to the leasee, or whether the Group had already undertaken all therisk and compensation related with theleased assets. (2)Provision forbad debts
In accordance with the accounting policies of accounts receivable, the Group measured the losses for bad debts by adopting allowance method. The impairment of accounts receivable was based on the appraisal of the recoverability of accounts receivable. The impairment of accounts receivable was dependent on the judgment and estimates. The actual amount and the difference of previous estimates would affect the book value of accounts receivable and the withdrawal and reversal on provision for bad debts of accounts receivable during the period of estimates being changed.
(3)Provision forfalling price ofinventories
In accordance with the accounting policies of inventories, for the inventories that the costs were more than the net realizable value as well as out-of-date and dull-sale inventories, the Group withdrawn the provision for falling price of inventories on the lower one between costs and net realizable value. Evaluating the falling price of inventories needed the management level gain the valid evidence and take full consideration of the purpose of inventories, influence of events after balance sheet date and other factors, and then made relevant judgments and estimates. The actual amount and the difference of previous estimates would affect the book value of inventories and the withdrawal and reversal on provision for bad debts of inventories during theperiod of estimates being changed.
(4)The fair valueof financial instrument
For the financial instruments without active market, the Group recognized the fair value by various methods. These evaluation methods included discounted cash flow mode analysis, etc. The Group needed to estimate the future cash flow, credit risk, fluctuation rate of market and relativity and other factors, as well as choose the property discount rate. Due to the uncertainty of relevant assumptions, so their changes would affect the fair value of financial instrument.
(5)The impairment offinancial assets available for sale
The Group judged whether the financial assets available for sale were impaired relying heavily on the judgment and assumption of the management team, so as to decide whether recognized the impairment losses in the income statement. During the process of making the judgment and assumption, the Group needed to appraise the balance of the cost of the investment exceeding its fair value and the continuous period, the financial status and
2015Semi-annualReportofKonkaGroupCo.,Ltd. business forecast in a short period, including the industrial situation, technical reform, credit level, defaultrate and risk ofcounterparty.
(6)Provision forimpairment of non-financial non-current assets
The Group made a judgment on the non-current assets other than financial assets whether they had any indication of impairment on the balance sheet date. For the intangible assets without finite service life, other than the annual impairment test, they should be subject to the impairment test when there was any indication of impairment. For other non-current non-financial assets, which should be subjected to impairment test when there was indication ofimpairment indicated that thebookvaluecan’t berecoverable.
When the book value of the assets or assets portfolio was more than the recoverable amount, which was the higher one between the net amount of fair value after deducting the disposal expenses and the discounted amount of the estimated future cash flow, it means impairment incurred.
The net amount of fair value after deducting the disposal expenses should be fixed the price in the sale agreement for similar assets in the fair transaction minus the increased costs directly attributableto theassets disposal.
When estimated the discounted value of future cash flow, the Group needed to make important judgment on the output, selling price, relevant costs and the discount rate for calculating the discounted amount, etc. When estimated the recoverable amount, the Group would adopt all the available documents, including the prediction for relevant output, selling priceand relevant operating costs arising from reasonable and supportiveassumptions.
The Group made the impairment test on goodwill at least one time per year, which required to predict the discounted amount of the future cash flow of the assets or assets portfolio with the distributed good will, for which, the Group needed to predict the future cash flow of the assets or assets portfolio, and adopt the property discounted rate to decide the discounted amountof futurecash flow.
(7)Depreciation and amortization
For the investment real estate, fixed assets and intangible assets, the Group withdrew the depreciation and amortization by adopting the straight-line method during the service life after full consideration of the salvage value. The Group checked the service life periodically so as to decide the amount of depreciation and amortization at each reporting period. The service life was fixed by the Group in accordance with the previous experience of the similar assets and the expected technical update. If there was any significant change on the previous estimates, thedepreciation and amortization expenses should beadjusted.
(8)Expenditures for development
When fixing the amount of capitalization, the management level of the Group needed to make assumption on the predicted future cash flow, property discounted rate and estimated beneficiary period forrelevant assets.
(9)Deferred income tax assets
Within the limit that it was likely to have sufficient taxable profits to offset the losses, the Group recognized the deferred income tax assets by all the unused tax losses, which needed the management level of the Group to estimate time and amount of the future taxable profits incurred with many judgments, as well as integrate strategy of tax payment, to decide the amountof deferred incometax assets which should berecognized.
(10)Income tax
During the routine operating activities, there were some uncertainty in the ultimate tax
2015Semi-annualReportofKonkaGroupCo.,Ltd. treatment and calculation for parts of transactions. Some accounts of such transaction could be listed as pre-tax expenditures only after the approval of taxation authorities. If there were any differences between the ultimate result of recognition for these taxation maters and their initial estimates, the differences would affect the current income tax and deferred income tax at theperiod of ultimaterecognition.
(11)Internal early retirement welfare andsupplementary retirement welfare
Amounts of expenditures and liabilities of internal early retirement welfare and supplementary retirement welfare should be determined according to assumption terms. Assumption terms include discount rate, average growth rate of medical costs, growth rate of subsidies for early retirement employees and retirees and other factors. The differences of actual results and assumption should be confirmed immediately and included into costs of current year. Although the management have adopted reasonable assumption terms, changes of actual experience value and assumption terms may affect the internal early retirement welfare, supplementary retirement benefits andbalance of liabilities.
(12)Estimated liabilities
The Group made the estimation on product quality guarantee, predicted loss of contract and the fine for delayed delivery etc. and withdrew the relevant provision for estimated liabilities in accordance the provisions of contract, current knowledge and experience. Under the condition that the contingent event has formed a current duty and fulfilling the duty is likely to cause the economical interest outflow the Group, the Group measures the estimated liabilities in accordance with the best estimate of the necessary expenses for the performance of the current duty. The recognition and measurement of estimated liabilities were heavily relied on the judgment of the management team. During the process of making judgment, the Group needed to appraisetherelevant risks,uncertainty and the timevalue ofmoney and etc. Of which, the Group estimated the liabilities basing on the after-sale services commitments to the customers upon the sale, repair and reform of goods. When estimating the liabilities, the Group has fully taken the consideration of the latest repair experience, but which may not reflect the repair situation in the future.Any increase / decrease of the provision for estimated liabilities may affect theprofits and losses in thefuture periods.
V.Taxation
1.Maintaxes andtax rate
Categoryoftaxes Specificsituationofthetaxesrate
Calculated the output tax at17% of taxable income and paid the VAT by the amount after deducting the deductible withholding VAT at current period, of VAT whichthesubsidiaryEuropeKonkaof21%,TelecommunicationTechnologyof17%,6%, which see details to (3); Shushida Logistics of11%,6% which see detailsto(4)
Businesstax Paidby5%oftaxablebusinessincome.
Paid at7% of the circulating tax actually paid, of which Dongguan Packing, Urban maintenance and construction
Dongguan Konka, Dongguan Mould, Boluo Konka, Boluo Konka Precision, tax
XutongdaandKunshanKangshengof5%.
2015Semi-annualReportofKonkaGroupCo.,Ltd. Categoryoftaxes Specificsituationofthetaxesrate
Paid at25% of the taxable income, of which Hong Kong Konka, Konka Household Appliances Investment, Konka Household Appliances InternationalTradingof16.5%,Wankaida,TelecommunicationTechnology,PrecisionMould, Enterpriseincometax
Information Network, Chongqing Qingjia, Anhui Konka, Kunshan Konka,DongguanKonka,DongguanMouldandXutongdaof15%,USAKonkaof28%andEuropeKonkaof31%.
Educationsurtax
Paidat3%ofthecirculatingtaxactuallypaid.
Localeducationsurtax
Paidat2%ofthecirculatingtaxactuallypaid.
(1) In accordance with the Notice on Printing the Administration Method on Charging and Use of the Treatment Funds of Discarded Electronic Appliance and Electric Products issued by the Ministry of Finance, Ministry of Environmental Protection, National Development and Reform Commission, Ministry of Industry and Information, General Administration of Customs and National Taxation Bureau (CZ[2012] No. 34), and the Administration Method on Charging and Use of the Treatment Funds of Discarded ElectronicAppliance and Electric Products issued by National Taxation Bureau (GJSWZJGG[2012] No. 41), the domestic manufacturer of the electrical appliances and electronic products of PRC started to pay the treatment funds for discarded electrical appliance and electronic products according the sales volume (trusted processing amount) and relevant charging standards from 1 Jul. 2012. According to the regulations, theGroup’s charging standards were RMB 13 per set of TV, RMB12per set ofrefrigeratorand RMB7per set ofwashing machine.
(2) According to regulations of Temporary Provisions of Income Tax of Trans-boundary Tax Payment Enterprises by State Administration of Taxation, resident enterprises without business establishment or places of legal persons should be tax payment enterprises with the administrative measures of income tax of “unified computing, level-to-level administration, local prepayment, liquidation summary, and finance transfer”. It came into force from January 1, 2008.According to the above methods, theCompany’s sales branch companies in each area will hand in the corporate income taxes in advance from 1 Jan. 2008 and will be final settled uniformly bytheCompany at theyear-end.
(3) TheCompany’s subsidiary, Shenzhen Konka Communication Technology Co., Ltd, is engaged in value-added services of brand costs. According to Notice of the Ministry of Finance and the StateAdministration of Taxation on the Pilot Work of Levying Value-Added Tax in Lieu of Business Tax in the Transportation Industry and Some Modern Service Industries in Beijing and Other Seven Provinces and Cities(CS[2012] No.71), added-value tax is levied from 1Nov.2012,with tax rateof6%.
(4) As for the transportation revenue of the logistic business of theCompany’s subsidiary Shushida Logistics, in accordance with the Notice on Carrying out the Pilot of Change on Charging the Business Taxes of Transportation Industry and Partial Modern Service Industry to ValueAdded Taxes in Eight Provinces and Cities including Beijing issued by the Ministry of Finance and the National Taxation Bureau (CS[2012] No. 71) and other regulations, it was changed to charge theVATsince 1 Sept. 2012, with the tax rate of3%. From 1 Jun. 2013, Shushida Logistics received the general taxpayer qualification with the VAT rate of the transportation revenueof11%and theotherservice of6%.
2015Semi-annualReportofKonkaGroupCo.,Ltd. 2.Taxpreference andapproved document
(1) On 30 Sep. 2014, the subsidiary of the Company Shenzhen Konka Telecommunication Technology Co., Ltd. acquired the certificate of high-technology enterprises jointly issued by Shenzhen Science and technology Innovation Committee, Shenzhen Finance Committee, Shenzhen Provincial Office, SAT, and Shenzhen Local Taxation Bureau, with the certification number of GR201444201101 and the validity of three years. According to the relevant taxation regulations, the Telecommunication Technology could enjoy the relevant preferential tax policy on the high-tech enterprise for continuous 3 years from 2014 to 2016, and pay forthecorporate incometax according to15%of thepreferential tax rate.
(2) On 30 Sep. 2014, the subsidiary of the Company Konka Precision Mould Manufacture Co., Ltd. acquired the certificate of high-technology enterprises jointly issued by Shenzhen Science and technology Innovation Committee, Shenzhen Finance Committee, Shenzhen Provincial Office, SAT, and Shenzhen Local Taxation Bureau, with the certification number of GR201444201781 and the validity of three years. According to the relevant taxation regulations, the Precision Mould could enjoy the relevant preferential tax policy on the high-tech enterprise for continuous 3 years from 2014 to 2016, and pay for the corporate incometax according to15%of thepreferential tax rate.
(3) On 22 Jul. 2013, the subsidiary of the Company Shenzhen Konka Information Network Co., Ltd. acquired the certificate of high-technology enterprises jointly issued by Shenzhen Science and technology Innovation Committee, Shenzhen Finance Committee, Shenzhen Provincial Office, SAT, and Shenzhen Local Taxation Bureau, with the certification number of GR201344200179 and the validity of three years. According to the relevant taxation regulations, the Information Network could enjoy the relevant preferential tax policy on the high-tech enterprise for continuous 3 years from 2013 to 2015, and pay for the corporate incometax according to15%of thepreferential tax rate.
(4) TheCompany’ssubsidiary—Chongqing Qingjia Electronics Co., Ltd. is levied the business income tax at the preferential tariff of15% from 1 Jan. 2011 to 31 Dec. 2020 in accordance with CS (2011) No. 58 Notice on Relevant Tax Policies on Deeply Implementing thewestern development strategy.
(5) On 14 Oct., 2013, the subsidiary of the Company, Anhui Konka, received the certificate of high-technology enterprises (No.: GF2013342000298) awarded by Anhui Science and Technology Department, Anhui Department of Finance, Anhui State Taxation Bureau and Anhui Local Taxation Bureau. The period of validity is three years. According to taxation rules, Anhui Konka would enjoy the preferential tax privileges of high-technology enterprises from 2013 to 2015 and pay the enterprise income tax at the preferential rate of15%.
(6) On 5 Aug. 2014, the subsidiary of the Company, Kunshan Konka Electronics Co., Ltd. acquired the certificate of high-technology enterprises joint issued by Jiangsu Province Science and Technology Department, Department of Finance of Jiangsu Province, Jiangsu Province Municipal Office, SAT, and Jiangsu Local Taxation Bureau with the certification number of GF201432000413 and the validity of three years. According to the relevant taxation regulations, the Kunshan Konka could enjoy the relevant preferential tax policy on the high-tech enterprise for continuous 3 years from 2014 to 2016, and pay for the corporate incometax according to15%of thepreferential tax rate.
(7) On 10 Oct. 2014, the subsidiary of the Company, Dongguan Konka acquired the certificate of high-technology enterprises joint issued by Guangdong Province Science and
2015Semi-annualReportofKonkaGroupCo.,Ltd. Technology Department, Department of Finance of Guangdong Province, Guangdong Province Municipal Office, SAT, and Guangdong Local Taxation Bureau with the certification number of GF201444001341 and the validity of three years. According to the relevant taxation regulations, the Dongguan Konka could enjoy the relevant preferential tax policy on the high-tech enterprise for continuous 3 years since 2014, and pay for the corporateincometax according to15%ofthepreferential tax rate.
(8) On 12 Sept. 2012, theCompany’s subsidiary, Dongguan Konka Mould Plastic acquired the certificate of high-technology enterprises joint issued by Guangdong Province Science and Technology Department, Department of Finance of Guangdong Province, Guangdong Province Municipal Office, SAT, and Guangdong Local Taxation Bureau with the certification number of GF201244000053 and the validity of three years. According to the relevant taxation regulations, the Kunshan Konka could enjoy the relevant preferential tax policy on the high-tech enterprise for continuous 3 years from 2012 to 2014, and pay for the corporate income tax according to15% of the preferential tax rate. Dongguan Mould Plastic had put forward the re-examination application within 3 months before the expiration of the qualification period and according to the Taxation Bureau, the corporate income tax should berepaidby15%of thetax rate temporarily ofthesame year.
(9) On 26 Nov. 2012, theCompany’s subsidiary, Xutongda acquired the certificate of high-technology enterprises joint issued by Guangdong Province Science and Technology Department, Department of Finance of Guangdong Province, Guangdong Province Municipal Office, SAT, and Guangdong Local Taxation Bureau with the certification number of GR201244000555 and the validity of three years. According to the relevant taxation regulations, the Kunshan Konka could enjoy the relevant preferential tax policy on the high-tech enterprise for continuous 3 years from 2012 to 2014, and pay for the corporate income tax according to15% of the preferential tax rate. Xutongda had put forward the re-examination application within 3 months before the expiration of the qualification period and according to the Taxation Bureau, the corporate income tax should be repaid by15% of thetax rate temporarily of thesameyear.
(10) On 30 Sep. 2014, theCompany’s subsidiary, Shenzhen Wankaida Science and Technology Co., Ltd. acquired the certificate of high-technology enterprises joint issued by Shenzhen Science and technology Innovation Committee, Shenzhen Finance Committee, Shenzhen Provincial Office, SAT, and Shenzhen Local Taxation Bureau with the certification number of GR201444201523 and the validity of three years. According to the relevant taxation regulations, the Anhui Tongchuang could enjoy the relevant preferential tax policy on the high-tech enterprise for continuous 3 years from 2012 to 2014, and pay for the corporateincometax according to15%ofthepreferential tax rate.
(11) According to the CS No.[2011] 100 Article issued by Ministry of Finance and State Administration of Taxation, if the ordinary VAT payer sells software products developed by itself, the VAT is levied at the rate of17% and after that, the part of actual tax burden of VAT which exceeds3% can enjoy the policy of refunding taxes immediately after levying taxes. The subsidiaries of the Company,Shenzhen KonkaTelecommunicationTechnology Co., Ltd., Shenzhen Konka Information Network Co., Ltd., Shenzhen Wankaida Science and Technology Co., Ltd. and Shenzhen Konka Yishijie Commercial Display Co., Ltd. enjoy such favorable policy.
2015Semi-annualReportofKonkaGroupCo.,Ltd. VIII. Notes on major items in consolidated financial statements ofthe Company
Unless otherwise noted, the following annotation project (including the main projects annotation of the financial statement of the Company), the period-begin refers to 1 Jan. 2015, the period-end refers to 30 Jun. 2015 and this period refers to Jan.– Jun. 2015 with the last period ofJan.–Jun. 2014.
1.Monetary funds
||
|-|
|Closingbalance|
|193,395.85|
|2,036,287,721.23|
|228,784,531.60|
|2,265,265,648.68|
|329,171,417.16|

 Notes: The closing balance of other monetary funds was the deposits of each margin deposit notwithdrawn at any time.
2.Notes receivable
(1)Category ofnotes receivable
||
|-|
|Closingbalance|
|3,230,958,057.77|
|3,150,000.00|
|3,234,108,057.77|

 (2)Notes receivable pledged bytheCompany at theperiod-end
Item Amount
Banker’sacceptancebill 1,561,200,609.03 Total 1,561,200,609.03 (3) Notes receivable which had endorsed by the Company or had discounted and had not due onthebalance sheet dateat the period-end
||
|-|
|Amountofrecognitionterminationattheperiod-end|
|2,082,112,157.01|
|2,082,112,157.01|

Notes: Up to 30 Jun. 2015, the Company pledged thebanker’s acceptance bill of the book
2015Semi-annualReportofKonkaGroupCo.,Ltd. value of RMB 1,561,200,609.03 for the comprehensive financing business such as handling thebilling, letterofcredit and thetrading financing.
3.Accounts receivable
(1)Accounts receivabledisclosed by category
Closingbalance
|||||
|-|-|-|-|
|Bookbalance||Baddebtprovision||
|Amount|Proportion(%)|Amount|Withdrawalproportion(%)|
|96,468,109.12|3.86|10,760,574.72|11.15|
|2,374,449,981.91|95.08|256,056,289.52|10.78|
|2,374,449,981.91|95.08|256,056,289.52|10.78|
|26,327,312.83|1.06|24,559,138.11|93.28|
|2,497,245,403.86|100.00|291,376,002.35|11.67|

 (Continued)
Openingbalance
|||||
|-|-|-|-|
|Bookbalance||Baddebtprovision||
|Amount|Proportion(%)|Amount|Withdrawalproportion(%)|
|—|—|—|—|
|2,516,702,016.18|98.95|259,303,584.71|10.30|
|2,516,702,016.18|98.95|259,303,584.71|10.30|

2015Semi-annualReportofKonkaGroupCo.,Ltd. Openingbalance
|||||
|-|-|-|-|
|Bookbalance||Baddebtprovision||
|Amount|Proportion(%)|Amount|Withdrawalproportion(%)|
|26,756,380.18|1.05|24,861,604.49|92.92|
|2,543,458,396.36|100.00|284,165,189.20|11.17|

① In the groups, accounts receivable adopting aging analysis method to accrue bad debt provisionat the year-end
Closingbalance
Aging
|||
|-|-|
|Accountsreceivable|Baddebtprovision|
|2,052,444,568.33|41,285,518.71|
|53,625,982.60|2,681,299.13|
|64,156,647.90|12,831,329.58|
|6,588,843.13|3,294,421.57|
|3,340,438.84|1,670,219.42|
|194,293,501.11|194,293,501.11|
|2,374,449,981.91|256,056,289.52|

②Accounts receivable withsignificant single amount for which bad debt provision
Accountsreceivable(classifiedbyunits) Yearendbalance
||||
|-|-|-|
|Accountsreceivable|Baddebtprovision|Withdrawproportion|
|22,031,757.12|3,056,853.89|13.87%|
|74,436,352.00|7,703,720.83|10.35%|
|96,468,109.12|10,760,574.72|—|

③Accounts receivable withinsignificant single amount for which bad debt provision
Accountsreceivable(classifiedbyunits) Yearendbalance
||||
|-|-|-|
|Accountsreceivable|Baddebtprovision|Withdrawproportion|
|16,818,083.44|16,818,083.44|100.00%|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||
|-|-|-|
|5,893,915.73|4,125,741.01|70.00%|
|1,223,622.25|1,223,622.25|100.00%|
|1,473,948.45|1,473,948.45|100.00%|
|917,742.96|917,742.96|100.00%|
|26,327,312.83|24,559,138.11|—|

 (2)Accounts receivablewithdraw,reversed orcollected of2015
The withdrawn bad debt provision of 2015 was of RMB 15,436,953.24, the amount of the bad debt provision reversed of 2015 was of RMB 8,163,567.96 and the amount of the otherdecreased bad debt provision was ofRMB 62,572.13
(3) Top 5 of the closing balance of the accounts receivable colleted according to the arrears party at theyear-end
The total amount of the Top 5 of the closing balance of the accounts receivable colleted according to the arrears party at the year-end was of RMB 741,253,745.35 that covered the proportion of29.68% in the total amount of the accounts receivable at the year-end, and the totalamount of thecorresponding withdrewbad debt provision was of RMB14,825,074.91. 4.Prepayment
(1)List byaging analysis:
||||||
|-|-|-|-|-|
|Closingbalance|||||
|Bookvalue||Baddebtprovision|Bookvalue||
|Amount|Proportion(%)||Amount|Proportion(%)|
|468,164,771.78|96.82|984,768.80|312,558,414.85|96.34|
|5,678,078.22|1.17|372,286.54|5,069,017.23|1.56|
|3,087,903.41|0.64|2,086,581.91|735,503.34|0.23|
|6,616,503.97|1.37|6,254,404.00|6,086,092.93|1.87|
|483,547,257.38|100.00|9,698,041.25|324,449,028.35|100.00|

 Notes: prepayments of significant amount and aged more than 1 year were mainly the
prepayments of the purchase of the materials of RMB 4,632,126.10. Of which the amount of
RMB 4,154,625.44 was the relevant materials which had quality problems and had not
2015Semi-annualReportofKonkaGroupCo.,Ltd. handle the accounts settlement as well as the material warehousing formalities, and the materials purchaseaccount prepaid should be presented as theprepayments.
(2) Top 5 of the closing balance of the prepayment colleted according to the prepayment target
The total amount of the Top 5 of the closing balance of the prepayment colleted according to the prepayment target was of RMB 55,008,725.80, which was of11.38% of the total amount oftheyear-end balance ofthe prepayments.
5.Interestreceivable
||
|-|
|Closingbalance|
|2,841,117.19|
|70,777.76|
|2,911,894.95|

 6.Otheraccounts receivable
(1)Other accounts receivabledisclosed bycategory
Closingbalance
|||||
|-|-|-|-|
|Bookbalance||Baddebtprovision||
|Amount|Proportion(%)|Amount|Withdrawalproportion(%)|
|96,468,109.12|3.86|10,760,574.72|11.15|
|2,374,449,981.91|95.08|256,056,289.52|10.78|
|2,374,449,981.91|95.08|256,056,289.52|10.78|
|26,327,312.83|1.06|24,559,138.11|93.28|
|2,497,245,403.86|100.00|291,376,002.35|11.67|

2015Semi-annualReportofKonkaGroupCo.,Ltd. (Continued)
Openingbalance
|||||
|-|-|-|-|
|Bookbalance||Baddebtprovision||
|Amount|Proportion(%)|Amount|Withdrawalproportion(%)|
|—|—|—|—|
|2,516,702,016.18|98.95|259,303,584.71|10.30|
|2,516,702,016.18|98.95|259,303,584.71|10.30|
|26,756,380.18|1.05|24,861,604.49|92.92|
|2,543,458,396.36|100.00|284,165,189.20|11.17|

① In the groups, other accounts receivable adopting aging analysis method to accrue bad debt provisionat theperiod-end
Otheraccountsreceivable(classifiedby Periodendbalance
||||
|-|-|-|
|Otheraccountsreceivable|Baddebtprovision|Withdrawproportion|
|18,115,952.51|5,058,104.93|27.92%|
|18,115,952.51|5,058,104.93|27.92%|

②Otheraccounts receivable with insignificant singleamount for which bad debt provision Closingbalance
Aging
|||
|-|-|
|Otheraccountsreceivable|Baddebtprovision|
|124,591,891.34|2,075,918.70|
|83,319,699.60|4,165,984.98|
|103,068,262.95|20,613,652.59|
|2,983,005.90|1,491,502.95|

2015Semi-annualReportofKonkaGroupCo.,Ltd. Closingbalance
Aging
|||
|-|-|
|Otheraccountsreceivable|Baddebtprovision|
|1,162,364.20|581,182.10|
|14,240,518.66|14,240,518.66|
|329,365,742.65|43,168,759.98|

(2)Accounts receivablewithdraw,reversed orcollected during thereporting period
The withdrawal amount of the bad debt provision of 2015 was of RMB 14,808,717.31, the amountof the reversed bad debt provision was of RMB 181,960.43 and the amount of the otherdecreased bad debt provision was ofRMB 15.69.
(3) Top 5 of the closing balance of the other accounts receivable colleted according to the arrears party
|||||
|-|-|-|-|
|Nature|Closingbalance|Aging|Proportionofthetotalperiodendbalanceoftheaccountsreceivable(%)|
|Subsidypaymentsofenergysaving|152,402,680.00|Within1year,1to2 years, 2 to 3years|43.86|
|Exportrebates|45,985,602.92|Within1year|13.23|
|Exportrebates|3,293,340.36|Within1year|0.95|
|Margin|2,675,693.48|1to2years|0.77|
|Margin|2,480,401.90|1to2years|0.71|
|—|206,837,718.66|—|59.52|

 7.Inventory
(1)Category
Closingbalance
||||
|-|-|-|
|Bookbalance|Ofwhich:thecapitalizedamountoftheborrowings|Impairmentofinventories|
|460,209,261.87|708,392.08|—|
|152,322,883.37|2,209,218.60|—|
|612,532,145.24|2,917,610.68|—|

2015Semi-annualReportofKonkaGroupCo.,Ltd. Closingbalance
||||
|-|-|-|
|Bookbalance|Ofwhich:thecapitalizedamountoftheborrowings|Impairmentofinventories|
|1,337,323,305.38|—|328,538,622.63|
|295,369,075.62|—|167,124,682.21|
|2,246,678,711.92|—|251,721,490.43|
|1,286,277.85|—|—|
|3,880,657,370.77|—|747,384,795.27|
|4,493,189,516.01|2,917,610.68|747,384,795.27|

 (Continued)
Openingbalance
||||
|-|-|-|
|Bookbalance|Ofwhich:thecapitalizedamountoftheborrowings|Impairmentofinventories|
|433,431,258.26|708,392.08|—|
|184,288,149.21|4,786,589.71|—|
|617,719,407.47|5,494,981.79|—|
|1,299,997,072.71|—|331,916,902.96|
|384,479,782.98|—|174,801,078.20|
|2,347,967,769.03|—|239,864,738.09|
|854,937.39|—|—|
|4,033,299,562.11|—|746,582,719.25|
|4,651,018,969.58|5,494,981.79|746,582,719.25|

(2)List ofthedevelopment cost
2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||
|-|-|-|
|Startingtime|Expectedcompletiontimeofthenextbatch|Openingbalance|
|Y2011|Completion by stages|433,431,258.26|
|Undetermined|Undetermined|—|
|||433,431,258.26|

 (3)List ofthedeveloped products
|||||
|-|-|-|-|
|Completiontime|Openingbalance|Increased|Decreased|
|Y2014|184,288,149.21|—|31,965,265.84|
||184,288,149.21|—|31,965,265.84|

 (4)Impairment ofinventories
||||||
|-|-|-|-|-|
|Openingbalance|Increasedamount||Decreasedamount||
||Withdrawal|Other|Reverse|Write-off|
|331,916,902.96|9,235,365.55|—|9,856,169.31|2,757,476.57|
|174,801,078.20|839,307.46|—|3,829,830.40|4,685,873.05|
|239,864,738.09|23,700,492.32|—|7,271,104.77|4,572,635.21|
|746,582,719.25|33,775,165.33|—|20,957,104.48|12,015,984.83|

 (5) Withdrawal provision basis of the falling price of the inventory and the reasons of the reserveorwrite-off
||
|-|
|Specificbasisofthewithdrawalofthefallingpriceprovisionofinventory|
|The realizable net value was lower than the inventorycost|
|The realizable net value was lower than the inventorycost|
|The realizable net value was lower than the inventory|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||
|-|
|Specificbasisofthewithdrawalofthefallingpriceprovisionofinventory|
|cost|
|The realizable net value was lower than the inventorycost|

8.Othercurrent assets
||
|-|
|Closingbalance|
|268,508,306.22|
|50,000,000.00|
|1,000,000.00|
|—|
|319,508,306.22|

 9.Available-for-salefinancialassets
(1)Information ofavailable-for-sale financial assets
||||||
|-|-|-|-|-|
|Closingbalance|||||
|Bookbalance|Depreciationreserves|Bookvalue|Bookbalance|Depreciationreserves|
|308,503,378.07|2,693,406.87|305,809,971.20|247,799,748.07|2,766,139.07|
|2,405,378.07|608,406.87|1,796,971.20|2,311,748.07|681,139.07|
|306,098,000.00|2,085,000.00|304,013,000.00|245,488,000.00|2,085,000.00|
|308,503,378.07|2,693,406.87|305,809,971.20|247,799,748.07|2,766,139.07|

 (2)Available-for-sale financial assets measured byfair valueat theperiod-end
Available-for-saleequity Categoryofavailable-for-salefinancialassets
instruments
Costoftheequityinstruments
2,405,378.07 Fairvalue
1,796,971.20 Change amount of the fair value accumulatively included in the other
805,841.90 comprehensiveincome
Withdrawnimpairmentamount
608,406.87
(3)Available-for-sale financial assets measured bycost at theperiod-end
2015Semi-annualReportofKonkaGroupCo.,Ltd. Bookbalance
||||
|-|-|-|
|Period-begin|Increase|Decrease|
|6,000,000.00|6,000,000.00|—|
|4,800,000.00|—|—|
|9,500,000.00|—|—|
|5,750,000.00|—|—|
|1,300,000.00|—|—|
|100,000.00|—|—|
|485,000.00|—|—|
|5,000,000.00|—|—|
|1,153,000.00|—|—|
|6,000,000.00|—|—|
|2,400,000.00|—|—|
|203,000,000.00|—|—|
|—|47,230,000.00|—|
|—|7,380,000.00|—|
|245,488,000.00|60,610,000.00|—|

 (Continued)
||||||
|-|-|-|-|-|
|Bookbalance||||Shareholdingproportionamongtheinvestees(%)|
|Period-begin|Increase|Decrease|Period-end||
|—|—|—|—|6.00|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||||
|-|-|-|-|-|
|—|—|—|—|7.68|
|—|—|—|—|19.33|
|—|—|—|—|9.58|
|1,300,000.00|—|—|1,300,000.00|8.33|
|100,000.00|—|—|100,000.00|—|
|485,000.00|—|—|485,000.00|1.00|
|—|—|—|—|9.62|
|200,000.00|—|—|200,000.00|11.50|
|—|—|—|—|6.00|
|—|—|—|—|4.26|
|—|—|—|—|—|
|—|—|—|—|10.04|
|—|—|—|—|14.76|
|2,085,000.00|—|—|2,085,000.00|—|

 (4) Changes of the impairment of the available-for-sale financial assets of the reporting period
Available-for-saleequity
Categoryofavailable-for-salefinancialassets
instruments
2015Semi-annualReportofKonkaGroupCo.,Ltd. Withdrawnimpairmentbalanceattheperiod-begin 2,766,139.07 Withdrawalofthereportingperiod — Ofwhich:transferredfromothercomprehensiveincome — Decreaseofthereportingperiod 72,732.20 Ofwhich:recoveredorreversedfromthefairvalueaftertheperiod 72,732.20 Withdrawnimpairmentbalanceattheperiod-end 2,693,406.87 10.Long-term equityinvestment
||||||
|-|-|-|-|-|
|Openingbalance|||||
||Additionalinvestment|Reducedinvestment|Gainsandlossesrecognizedundertheequitymethod|Adjustmentofothercomprehensiveincome|
|43,425,481.67|—|—|1,564,853.96|—|
|110,793,944.21|—|—|-5,038,950.02|—|
|3,649,728.08|—|—|—|—|
|197,758,604.87|—|—|-1,798,656.54|—|
|7,137,424.83|—|—||—|
|—|6,210,000.00|—|116,347.78|—|
|362,765,183.66|6,210,000.00|—|-5,156,404.82|—|

 (Continued)
|||||
|-|-|-|-|
|Increase/decrease|||Closingbalance|
|Declarationofcashdividendorprofits|Withdrawbaddebtprovision|Other||

2015Semi-annualReportofKonkaGroupCo.,Ltd.
|||||
|-|-|-|-|
|1,487,448.32|—|—|43,502,887.31|
|—|—|—|108,228,674.85|
|—|—|—|3,649,728.08|
|—|—|—|195,959,948.33|
|—|—|—|7,137,424.83|
|—|—|—|6,326,347.78|
|1,487,448.32|—|—|364,805,011.18|

 11.Investment property
(1)Investment property calculated bycost
||||
|-|-|-|
|Housesandbuildings|Landuseright|constructioninprogress|
|249,923,047.75|—|—|
|—|—|—|
|—|—|—|
|249,923,047.75|—|—|
|16,573,594.95|—|—|
|2,815,637.15|—|—|
|2,815,637.15|—|—|
|—|—|—|
|19,389,232.10|—|—|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||
|-|-|-|
|Housesandbuildings|Landuseright|constructioninprogress|
|—|—|—|
|—|—|—|
|—|—|—|
|—|—|—|
|230,533,815.65|—|—|
|233,349,452.80|—|—|

 (2) Amount and reason of the investment property failed to accomplish certification of property
||
|-|
|Bookvalue|
|230,533,815.65|

12.Fixed assets
(1)List offixed assets
||||||
|-|-|-|-|-|
|Housesandbuildings|Machineryequipment|Electronicequipment|Transportationequipment|Other|
|1,666,832,339.28|1,025,362,549.65|252,641,100.35|74,244,036.50|214,920,840.16|
|10,842,538.20|19,773,855.93|9,251,172.29|2,367,502.55|7,818,858.18|
|3,437,909.80|16,899,072.96|9,251,172.29|2,367,502.55|6,985,653.01|
|7,404,628.40|2,874,782.97|—|—|833,205.17|
|406,000.00|2,785,524.10|4,018,081.84|4,170,226.32|4,737,776.34|
|406,000.00|2,785,524.10|4,018,081.84|4,170,226.32|4,737,776.34|
|1,677,268,877.48|1,042,350,881.48|257,874,190.80|72,441,312.73|218,001,922.00|
|401,426,983.75|590,925,364.93|201,361,698.85|52,503,060.71|140,779,033.03|
|18,867,945.47|29,064,593.42|7,730,493.37|3,506,444.41|10,052,034.41|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||||
|-|-|-|-|-|
|Housesandbuildings|Machineryequipment|Electronicequipment|Transportationequipment|Other|
|18,867,945.47|29,064,593.42|7,730,493.37|3,506,444.41|10,052,034.41|
|362,355.00|2,308,061.19|3,592,287.90|3,559,382.97|4,365,248.67|
|362,355.00|2,308,061.19|3,592,287.90|3,559,382.97|4,365,248.67|
|419,932,574.22|617,681,897.16|205,499,904.32|52,450,122.15|146,465,818.77|
|53,124,316.45|6,198,654.13|1,628,053.45|899,230.59|1,458,921.13|
|—|1,686,990.03|883,949.90|9,190.00|46,896.25|
|—|1,686,990.03|883,949.90|9,190.00|46,896.25|
|—|—|—|—|—|
|53,124,316.45|7,885,644.16|2,512,003.35|908,420.59|1,505,817.38|
|1,204,211,986.81|416,783,340.16|49,862,283.13|19,082,769.99|70,030,285.85|
|1,212,281,039.08|428,238,530.59|49,651,348.05|20,841,745.20|72,682,886.00|

 Notes: As of 30 Jun. 2015, there was no fixed asset with restricted ownership in theCompany。
(2)List oftemporarily idlefixed assets
|||||
|-|-|-|-|
|Originalbookvalue|Accumulativedepreciation|Impairmentprovision|Bookvalue|
|4,284,173.90|2,458,069.58|—|1,826,104.32|
|484,642.84|211,620.12|—|273,022.72|
|—|—|—|0.00|
|17,666,176.14|15,899,558.53|882,441.82|884,175.79|
|418,337.25|376,503.53|20,916.86|20,916.86|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
|||||
|-|-|-|-|
|22,853,330.13|18,945,751.76|903,358.68|3,004,219.69|

(3)Fixed assets leased in from financing lease
||||
|-|-|-|
|Originalbookvalue|Accumulativedepreciation|Impairmentprovision|
|5,526,681.05|989,119.92|—|

 (4)Fixed assets leased out from operation lease
Item Closingbookvalue
Housesandbuildings
34,649,674.28 Total
34,649,674.28 (5)Details of fixed assets failed to accomplishcertification of property
||
|-|
|Bookvalue|
|264,692,309.43|
|49,186,516.19|
|21,760,035.74|
|12,950,435.07|
|12,187,010.26|
|9,542,222.22|
|4,897,335.26|
|3,911,275.16|
|1,826,104.32|

13.Construction inprogress
(1)List ofconstruction in progress
||||||
|-|-|-|-|-|
|Closingbalance|||||
|Bookbalance|Impairmentprovision|Bookvalue|Bookbalance|Impairmentprovision|
|64,365,430.88|—|64,365,430.88|55,896,269.73|—|
|1,643,881.07|—|1,643,881.07|1,643,881.07|—|
|36,511,599.51|—|36,511,599.51|29,459,670.93|—|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||||
|-|-|-|-|-|
|Closingbalance|||||
|Bookbalance|Impairmentprovision|Bookvalue|Bookbalance|Impairmentprovision|
|28,333,853.73|—|28,333,853.73|18,304,006.73|—|
|3,206,801.60|—|3,206,801.60|—|—|
|169,559.78|—|169,559.78|873,065.82|—|
|61,697,369.27|—|61,697,369.27|53,427,989.81|—|
|195,928,495.84|—|195,928,495.84|159,604,884.09|—|

 (2)Changes ofsignificant construction in progress
||||||
|-|-|-|-|-|
|Estimatednumber|Openingbalance|Increasedamountoftheperiod|Amountthattransferredtofixedassetsoftheperiod|Otherdecreasedamountoftheperiod|
|441,600,000.00|55,896,269.73|8,469,161.15|—|—|
|26,320,000.00|1,643,881.07|—|—|—|
|36,550,000.00|29,459,670.93|7,051,928.58|—|—|
|40,000,000.00|18,304,006.73|10,029,847.00|—|—|
|4,186,655.78|—|3,206,801.60|—|—|
|3,075,000.00|873,065.82|358,974.36|1,062,480.40|—|
|—|53,427,989.81|25,029,421.29|10,050,136.14|6,709,905.69|
|551,731,655.78|159,604,884.09|54,146,133.98|11,112,616.54|6,709,905.69|

 (Continued)
||||||
|-|-|-|-|-|
|ProportionofAccumulativeinvestmentinbudget(%)|Progressofworks|Accumulativeamountofinterestcapitalization|Ofwhich:amountofinterestcapitalizationinreportingperiod|Rateofinterestcapitalization(%)|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||||
|-|-|-|-|-|
|ProportionofAccumulativeinvestmentinbudget(%)|Progressofworks|Accumulativeamountofinterestcapitalization|Ofwhich:amountofinterestcapitalizationinreportingperiod|Rateofinterestcapitalization(%)|
|14.58|34.00|810,165.16|—|—|
|6.25|—|—|—|—|
|98.00|98.00|1,181,842.26|579,583.49|6.72|
|70.83|70.83|—|—|—|
|76.60|76.60|—|—|—|
|11.67|11.67|—|—|—|

 Notes: the other decrease of the construction in progress was the intangible assets transferred from thesoftware development oftheGroup.
14.Intangibleassets
(1)Information
|||||
|-|-|-|-|
|Landuseright|Patent|Trademarkregistrationexpense|Other|
|366,197,934.11|40,139,739.88|3,519,159.61|30,062,433.23|
|—|25,709.40|—|13,110,758.31|
|—|25,709.40|—|13,110,758.31|
|—|—|—|—|
|—|—|—|—|
|—|—|—|—|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
|||||
|-|-|-|-|
|Landuseright|Patent|Trademarkregistrationexpense|Other|
|366,197,934.11|40,165,449.28|3,519,159.61|43,173,191.54|
|40,380,243.37|32,123,987.40|3,364,176.89|13,523,645.98|
|4,046,082.72|422,180.61|21,213.73|1,624,582.47|
|4,046,082.72|422,180.61|21,213.73|1,624,582.47|
|—|—|—|—|
|—|—|—|—|
|—|—|—|—|
|44,426,326.09|32,546,168.01|3,385,390.62|15,148,228.45|
|—|2,901,082.61|—|—|
|—|—|—|—|
|—|—|—|—|
|—|—|—|—|
|—|—|—|—|
|—|2,901,082.61|—|—|
|321,771,608.02|4,718,198.66|133,768.99|28,024,963.09|
|325,817,690.74|5,114,669.87|154,982.72|16,538,787.25|

 (2)Details of fixed assets failed to accomplishcertification of land useright
||
|-|
|Bookvalue|
|3,153,608.13|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||
|-|
|Bookvalue|

(3)Other notes:
The land use right of book value of intangible assets of theCompany’s subsidiary Kunshan Konka Electronic Co., Ltd. was RMB 79,197,475.64 which was pledged for long term loan ofRMB63,876,957.13.
15.Goodwill
(1)Original bookvalue ofgoodwill
||||||
|-|-|-|-|-|
|Openingbalance|Increase||Decrease||
||Formedfromthebusinesscombination|Other|Dispose|Other|
|3,597,657.15|—|—|—|—|
|3,597,657.15|—|—|—|—|

 (2)The method ofimpairment test and impairment provision, see note19,IV.
(3)As of30 Jun. 2015,there was nobookvalue ofgoodwill higherthan recoverable amount. 16.Long-term unamortized expenses
|||||
|-|-|-|-|
|Openingbalance|Increase|Amortizationamount|Otherdecrease|
|9,557,434.43|3,465,448.27|1,793,422.53|—|
|10,280,675.07|24,240,688.71|6,596,617.24|261,027.80|
|5,954,695.56|8,017,880.51|2,223,032.87|5,516.40|
|25,792,805.06|35,724,017.49|10,613,072.64|266,544.20|

 17.Deferredincometax assets/deferredincome tax liabilities
(1)Deferred income tax assets had not been off-set
||||
|-|-|-|
|Closingbalance|||
|Deductibletemporarydifference705,989,350.84|Deferredincometaxassets|Deductibletemporarydifference680,584,889.73|
||174,445,450.49||
|32,736,868.12|8,184,217.03|45,585,627.57|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||
|-|-|-|
|Closingbalance|||
|Deductibletemporarydifference|Deferredincometaxassets|Deductibletemporarydifference|
|80,640,095.89|20,068,125.82|92,847,148.47|
|92,848,868.87|22,174,573.22|91,852,218.96|
|405,772,588.06|95,432,156.48|137,205,313.83|
|-44,500.00|-8,863.50|—|

 (2)Deferred income tax liabilities had not been off-set
||||
|-|-|-|
|Closingbalance|||
|Taxabletemporarydifferences|Deferredincometaxliabilities|Taxabletemporarydifferences|
|9,540,354.13|1,431,053.12|6,996,658.49|
|23,840,114.88|5,960,028.72|—|
|33,380,469.01|7,391,081.84|6,996,658.49|

 (3)Deferred income tax assets orliabilities listed bynet amount after off-set
||
|-|
|Closingbalance|
|497,009,282.95|
|567,662,571.04|
|1,064,671,853.99|

 18.Othernon-currentassets
||
|-|
|Closingbalance|
|—|
|—|

 19.Listof theassets impairment provision
|||||
|-|-|-|-|
|Openingbalance|Withdrawal|Decrease||
|||Reverse|Write-off|
|327,064,296.70|30,679,723.63|8,380,357.75|62,754.07|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
|||||
|-|-|-|-|
|Openingbalance|Withdrawal|Decrease||
|746,582,719.25|33,775,165.33|20,957,104.48|12,015,984.83|
|2,766,139.07|—|72,732.20|—|
|63,309,175.75|2,627,026.18|—|—|
|2,901,082.61|—|—|—|
|1,142,623,413.38|67,081,915.14|29,410,194.43|12,078,738.90|

 20.Shortterm loan
||
|-|
|Closingbalance|
|66,206,000.00|
|—|
|1,588,476,154.34|
|3,884,814,053.34|
|5,539,496,207.68|

 Notes: The account receivable of book balance of Dongguan Mould Plastic of RMB 6,343,657.52was pledged for a loan ofRMB 5.07 millionin 2015.
The company's order book balance is RMB 10,338,200.40 accounts receivable as collateral obtained loans RMB 10,000,000.00.
21.Notes payable
||
|-|
|Closingbalance|
|—|
|1,069,722,035.13|
|1,069,722,035.13|

 Notes: RMB1,069,722,035.13will beduein nextfiscal period.
22.Accounts payable
(1)List ofaccounts payable
2015Semi-annualReportofKonkaGroupCo.,Ltd.
||
|-|
|Closingbalance|
|2,508,417,420.54|
|1,488,331,968.56|
|591,376,251.32|
|404,241,071.48|
|23,086,896.54|
|1,381,232.64|
|197,581.40|
|74,225,875.12|
|2,582,840,877.06|

 (2)Notes of theaccounts payable aging over oneyear
||
|-|
|Amount|
|15,911,043.38|
|5,038,769.40|
|2,902,005.96|
|1,499,564.98|
|801,445.61|
|559,067.17|
|339,041.60|
|27,050,938.10|

23.Advancefrom customers
(1)List ofadvance from customers
||
|-|
|Closingbalance|
|379,157,521.64|
|9,269,842.38|
|5,506,594.29|
|8,933,178.65|
|402,867,136.96|

 (2)Significant advance from customers aging over oneyear was sale expenseunsettled 24.Payrollpayable
(1)List ofPayroll payable
2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||
|-|-|-|
|Openingbalance|Increase|Decrease|
|296,701,946.79|758,267,558.67|843,112,693.92|
|2,562,794.26|69,434,462.31|68,880,549.62|
|7,974.00|2,920,473.92|2,895,473.92|
|—|—|—|
|299,272,715.05|830,622,494.90|914,888,717.46|

 (2)List ofShort-term salary
||||
|-|-|-|
|Openingbalance|Increase|Decrease|
|288,171,641.38|669,740,080.46|764,174,297.24|
|1,111,472.13|35,511,277.79|29,068,920.35|
|1,526,026.37|28,263,624.00|27,859,969.16|
|1,285,679.34|23,568,682.49|23,347,527.18|
|91,233.21|2,620,220.21|2,575,245.32|
|149,113.82|2,074,721.30|1,937,196.66|
|1,504,548.35|15,523,470.12|15,005,953.17|
|4,388,258.56|9,229,106.30|7,003,554.00|
|—|—|—|
|—|—|—|
|—|—|—|
|296,701,946.79|758,267,558.67|843,112,693.92|

 (3) List of defined contribution plans
||||
|-|-|-|
|Openingbalance|Increase|Decrease|
|2,437,546.24|65,492,118.67|65,173,675.36|
|125,248.02|3,940,807.59|3,705,338.21|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||
|-|-|-|
|Openingbalance|Increase|Decrease|
|—|1,536.05|1,536.05|
|2,562,794.26|69,434,462.31|68,880,549.62|

 The Company, in line with the requirement, participate the endowment insurance, unemployment insurance scheme and so on, according to the scheme, the Company monthly pay to the scheme in line with requirements of local government, except the monthly payment, the Company no longer shoulder the further payment obligation, the relevant expenseoccurred was recorded intocurrent profits and losses orrelated assets costs.
25.Taxes payable
||
|-|
|Closingbalance|
|21,490,744.58|
|2,230,849.62|
|1,865,941.85|
|1,316,749.19|
|3,803,864.36|
|829,317.16|
|2,957,434.46|
|17,251,061.00|
|20,303,337.68|
|72,049,299.90|
|21,490,744.58|

 26.Interestpayable
||
|-|
|Closingbalance|
|32,580,621.62|
|32,580,621.62|

 27.Dividendpayable
||
|-|
|Closingbalance|
|12,039,727.04|
|12,039,727.04|

28.Otheraccounts payable
2015Semi-annualReportofKonkaGroupCo.,Ltd. (1)Other accounts payable listedby nature oftheaccount
||
|-|
|Closingbalance|
|752,403,594.47|
|214,784,521.82|
|130,157,295.95|
|30,784,395.76|
|133,705,899.99|
|1,261,835,707.99|

 (2)Other significant accounts payable withaging over1year
||
|-|
|Closingbalance|
|3,800,000.00|
|2,075,485.15|
|3,591,041.94|
|10,350,000.00|
|5,000,000.00|
|24,816,527.09|

29.Non-currentliabilities duewithin1year
||
|-|
|Closingbalance|
|796,757.13|
|796,757.13|

 30.Long-term loan
||
|-|
|Closingbalance|
|63,876,957.13|
|614,234,305.73|
|678,111,262.86|

 Notes: themortgage asset category and amount ofmortgageloan see Notes 51.
31.Long-term payables
||
|-|
|Closingbalance|
|30,000,000.00|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||
|-|
|Closingbalance|
|930,685.33|
|796,757.13|
|30,133,928.20|

 32.Longterm payroll payable
(1)List oflong term payroll payable
||
|-|
|Closingbalance|
|26,256,521.15|
|—|
|—|
|26,256,521.15|

 (2)Changes ofdefined benefit plans
①Present worth of defined benefit plans obligation:
||
|-|
|Reportingperiod|
|28,554,734.16|
|—|
|—|
|—|
|—|
|—|
|—|
|2,298,213.01|
|26,256,521.15|

② Explanations of contents and related risks of defined benefit plans, and influences to
future cash flow,timeanduncertainties
Due to upgrading and reconstruction of current work sites of the subsidiary, communication
2015Semi-annualReportofKonkaGroupCo.,Ltd. technology, it is to adjust the labor relations according to Implementation Measures for Accompanying Employees in manufacturing system of Shenzhen Konka Communication Technology Co., Ltd on the premise to balance theCompany’s andemployees’ benefits and voluntary selection, Communication Technology provides early retirement plans for senior employees (employed before December 31, 1990 and signed non-fixed term labor contract withtheCompany orCommunicationTechnology). Content oftheplans includes:
1. Until March 31, 2014, the internal retire employee in line with the time length to mandatory age for retirement, which are classified as three classes, conducted relevant standard ofretirement pensions
2. Internal early retirement pensions include social insurance and housing provident funds bornebyindividuals.Theage is subject to that recorded in personnel archives.
3. Seniority subsidies for internal early retirement are classified as four classes in line with thetimelength of working age, ofwhich, working ageis calculated onan annualized basis. 4.Voluntary early retirement should be applied by individuals and approved by the leaders of Communication Technology and the Group. During the period of early retirement, management oftheemployees isresponsible bytheCompany.
The accumulative compensation paid to the internal early retirement pensions in future year is RMB 34,931,714.55, the Company in line with Agreement of Internal Early Retirement Pension, in line with the standard of salary remaining the same, turnover rate of 0, the mortality rate of, fix standard of social security base payment remaining the same to test the present worth of defined benefit plans. The actual payment for the employee is influence by theactual turnoverrate, death rate andthechanges ofminimumcardinality ofsocial security.③Notes to analysis results of major actuarial assumptions and sensibility of defined benefit plans
||
|-|
|Closingperiod|
|Treasurybondrateinsameperiod|
|0%|
|Overlegalemeritusage|
|0%|

33.Deferredincome
|||||
|-|-|-|-|
|Openingbalance|Increase|Decrease|Closingbalance|
|147,315,999.02|13,560,000.00|12,944,347.31|147,931,651.71|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
|||||
|-|-|-|-|
|147,315,999.02|13,560,000.00|12,944,347.31|147,931,651.71|

Items involved ingovernment subsidies:
||||||
|-|-|-|-|-|
|Openingbalance|Amountofnewlysubsidy|Amountaccruedinnon-businessincome|Otherchanges|Closingbalance|
|4,400,000.00|—|1,200,000.00|—|3,200,000.00|
|1,725,000.00|—|450,000.00|—|1,275,000.00|
|2,869,999.89|—|820,000.02|—|2,049,999.87|
|6,499,999.94|—|1,000,000.02|—|5,499,999.92|
|4,750,000.01|—|499,999.98|—|4,250,000.03|
|5,620,000.00|—|—|—|5,620,000.00|
|5,256,893.21|—|—|—|5,256,893.21|
|2,050,000.00|—|300,000.00|—|1,750,000.00|
|17,550,000.00|—|1,755,000.00|—|15,795,000.00|
|3,000,000.00|—|260,869.56|—|2,739,130.44|
|4,200,000.00|—|300,000.00|—|3,900,000.00|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||||
|-|-|-|-|-|
|3,600,000.00|—|1,200,000.00|—|2,400,000.00|
|11,550,000.00|—|—|—|11,550,000.00|
|2,470,000.00|—|—|—|2,470,000.00|
|2,000,000.00|—|—|—|2,000,000.00|
|8,508,737.85|—|—|600,000.00|7,908,737.85|
|12,800,000.00|—|—|—|12,800,000.00|
|2,030,000.00|—|—|—|2,030,000.00|
|2,800,000.00|—|—|—|2,800,000.00|
|2,259,541.37|—|—|—|2,259,541.37|
|2,940,000.00|—|100,000.02|—|2,839,999.98|
|2,775,000.00|—|150,000.00|—|2,625,000.00|
|2,068,933.33|—|210,400.02|—|1,858,533.31|
|2,600,000.00|—|—|—|2,600,000.00|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||||
|-|-|-|-|-|
|—|1,000,000.00|—|—|1,000,000.00|
|—|5,000,000.00|—|—|5,000,000.00|
|—|1,560,000.00|78,000.00|—|1,482,000.00|
|—|2,000,000.00|—|—|2,000,000.00|
|—|4,000,000.00|—|—|4,000,000.00|
|19,421,588.06|—|2,015,350.08|—|17,406,237.98|
|135,745,693.66|13,560,000.00|10,339,619.70|600,000.00|138,366,073.96|
|11,570,305.36|—|2,004,535.37|192.24|9,565,577.75|
|11,570,305.36|—|2,004,535.37|192.24|9,565,577.75|
|147,315,999.02|13,560,000.00|12,344,155.07|600,192.24|147,931,651.71|

34.Sharecapital
|||||||
|-|-|-|-|-|-|
|Opening balance|Increase/decrease(+/-)|||||
||Issuingnewshares|Bonusshares|Capitalizationofpublicreserves|Other|Subtotal|
|1,203,972,704.00|—|—|—|—|—|

 35.Capitalreserves
||||
|-|-|-|
|Openingbalance|Increase|Decrease|
|1,211,366,082.55|—|—|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||
|-|-|-|
|78,037,481.44|2,473,680.66|—|
|1,289,403,563.99|2,473,680.66|—|

2015Semi-annualReportofKonkaGroupCo.,Ltd. 36.Othercomprehensiveincome
|||||||
|-|-|-|-|-|-|
|Openingbalance|Reportingperiod|||||
||Amountincurredbeforeincometax|Less:Amounttransferredintoprofitandlossinthecurrentperiodthatrecognizedintoothercomprehensiveincomeinpriorperiod|Less:incometaxexpense|After-taxattributetotheparentcompany|After-taxattributetominorityshareholder|
|—|—|—|—|—|—|
|—|—|—|—|—|—|
|—|—|—|—|—|—|
|516,457.28|117,232.20|—|27,046.55|90,185.65|—|
|15,655,020.63|1,042,317.66|—|—|674,846.89|367,470.77|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
|||||||
|-|-|-|-|-|-|
|Openingbalance|Reportingperiod|||||
||Amountincurredbeforeincometax|Less:Amounttransferredintoprofitandlossinthecurrentperiodthatrecognizedintoothercomprehensiveincomeinpriorperiod|Less:incometaxexpense|After-taxattributetotheparentcompany|After-taxattributetominorityshareholder|
|16,171,477.91|1,159,549.86|—|27,046.55|765,032.54|367,470.77|

Notes: Corresponding other comprehensive of opening balance, closing balance in relevant balance sheet. Closing balance+ comprehensive incomeAT attributable to the parent company= closing balance. Amount in reporting period and corresponding other comprehensive in income statement,Amount before tax in reporting period-recorded into other comprehensive income in previous period transferred into current profits or losses - income tax expense= other comprehensive incomeATattributable to the parent company+ other comprehensive incomeATattributable tominority shareholder.
2015Semi-annualReportofKonkaGroupCo.,Ltd. 37.Surplusreserves
||||
|-|-|-|
|Openingbalance|Increase|Decrease|
|593,846,200.71|—|—|
|254,062,265.57|—|—|
|847,908,466.28|—|—|

 Notes: Based on the regulations of the Corporation Law and Constitution, the Company should withdraw10% of the statutory surplus reserves according tot the net profits. If the accumulated amount of the statutory surplus reserves exceeded the50% of the registered capital, theCompany could nomore withdraw.
The Company, after withdraw statutory surplus reserves, can withdraw discretional surplus reserves, in line with the approval, the discretional surplus reserves can be used for making uplosses inprevious year orincrease sharecapital
38.Retained profits
||
|-|
|2015|
|746,022,758.89|
|—|
|746,022,758.89|
|-296,953,507.39|
|—|
|—|
|12,039,727.04|
|—|
|437,029,524.46|

 Notes: The company was held on May 28, 2015 2014 annual consideration by the General Assembly, Scenarios are as follows:Based on theCompany’s total share capital of 1,203,972,704shares as at the end of 2014,the Company distributed a cash dividend of RMB 0.1 (tax included) to every 10 shares. The distributed profits aggregated RMB 12,039,727.04 and theretained profit was carried forward into thenextyear for distribution.
2015Semi-annualReportofKonkaGroupCo.,Ltd. 39.RevenueandCost ofSales
(1)Revenue, Costof Sales
||||
|-|-|-|
|Reportingperiod|||
|Revenue|Cost|Revenue|
|8,246,299,638.18|7,161,672,404.62|8,282,878,605.00|
|698,259,282.78|629,543,395.95|107,189,090.48|
|8,944,558,920.96|7,791,215,800.57|8,390,067,695.48|

 (2)Main business (Classified byindustry)
||||
|-|-|-|
|Reportingperiod|||
|Revenueofsales|Costsofsales|Revenueofsales|
|8,246,299,638.18|7,161,672,404.62|8,282,878,605.00|
|8,246,299,638.18|7,161,672,404.62|8,282,878,605.00|

 (3)Main business (Classified byproduct)
||||
|-|-|-|
|Reportingperiod|||
|Revenueofsales|Costsofsales|Revenueofsales|
|5,839,273,101.30|4,998,980,729.53|6,169,494,584.43|
|405,882,081.01|394,112,904.23|772,672,737.46|
|828,393,555.30|650,002,713.45|790,777,396.77|
|1,172,750,900.57|1,118,576,057.41|549,933,886.34|
|8,246,299,638.18|7,161,672,404.62|8,282,878,605.00|

 (4)Main business (Classified byarea)
||||
|-|-|-|
|Reportingperiod|||
|Revenueofsales|Costsofsales|Revenueofsales|
|4,807,213,043.19|3,897,064,692.75|5,918,248,976.50|
|3,439,086,594.99|3,264,607,711.87|2,364,629,628.50|
|8,246,299,638.18|7,161,672,404.62|8,282,878,605.00|

2015Semi-annualReportofKonkaGroupCo.,Ltd. (5)Therevenue ofsales from thetop five customers
||
|-|
|Mainbusinessrevenue|
|1,682,516,602.23|
|1,798,840,882.33|

40.Businesstax andsurcharges
||
|-|
|Reportingperiod|
|5,496,133.92|
|12,849,394.39|
|6,391,442.89|
|3,641,622.06|
|331,413.41|
|28,710,006.67|

 Notes: themeasurement standards ofbusiness tax and surcharges see NotesV.Tax
41.Salesexpenses
||
|-|
|Reportingperiod|
|332,857,088.15|
|174,049,619.44|
|168,134,586.26|
|155,114,369.05|
|119,606,305.71|
|20,877,888.67|
|18,327,672.91|
|14,363,429.92|
|13,263,180.79|
|11,618,648.04|
|96,476,161.41|
|1,124,688,950.35|

42．Administration expense
||
|-|
|Reportingperiod|
|104,617,216.07|
|67,908,610.15|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||
|-|
|Reportingperiod|
|18,202,729.34|
|17,552,634.06|
|10,056,569.85|
|8,726,615.59|
|8,059,767.37|
|5,633,366.65|
|5,429,742.03|
|4,966,713.86|
|41,084,938.74|
|292,238,903.71|

 43.Financial expenses
||
|-|
|Reportingperiod|
|82,012,379.10|
|25,280,539.71|
|39,133,044.16|
|3,202,027.62|
|99,066,911.17|

 44.Asset impairmentloss
||
|-|
|Reportingperiod|
|22,299,365.88|
|12,818,060.85|
|2,627,026.18|
|37,744,452.91|

 45.Investmentincome
||
|-|
|Reportingperiod|
|-5,017,326.85|
|—|
|2,153,880.21|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||
|-|
|Reportingperiod|
|10,048,900.77|
|7,185,454.13|

 46.Non-operating gains
|||
|-|-|
|2015|2014|
|140,774.90|160,385.54|
|140,774.90|160,385.54|
|—|—|
|61,900,356.24|51,628,675.32|
|3,598,283.81|—|
|2,879,986.02|2,620,502.92|
|903,762.58|3,805,904.24|
|69,423,163.55|58,215,468.02|

 Government subsidies recorded intocurrent profits andlosses
|||
|-|-|
|2015|2014|
|34,130,823.15|33,065,348.65|
|7,000,000.00|—|
|1,983,350.08|3,692,856.61|
|1,824,475.37|864,748.02|
|1,755,000.00|1,755,000.00|
|1,200,000.00|1,200,000.00|
|1,200,000.00|1,200,000.00|
|1,000,000.02|1,000,000.02|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
|||
|-|-|
|2015|2014|
|1,000,000.00|1,000,000.00|
|820,000.02|820,000.02|
|499,999.98|—|
|450,000.00|450,000.00|
|300,000.00|300,000.00|
|300,000.00|300,000.00|
|260,869.56|—|
|234,961.00|820,722.00|
|210,400.02|—|
|210,000.00|210,000.00|
|180,060.00|1,800,000.00|
|150,000.00|75,000.00|
|—|1,320,000.00|
|7,190,417.04|1,755,000.00|
|61,900,356.24|51,628,675.32|

47.Non-operating expenses
2015Semi-annualReportofKonkaGroupCo.,Ltd.
|||
|-|-|
|Reportingperiod|Sameperiodoflastyear|
|1,333,624.80|3,468,914.31|
|1,333,624.80|3,468,914.31|
|—|—|
|—|—|
|517,570.40|68,973.65|
|36,000.00|118,001.24|
|1,335,108.95|380,051.82|
|3,222,304.15|4,035,941.02|

 48.Incometax expense
(1)Lists ofincometax expense
||
|-|
|Reportingperiod|
|3,363,107.56|
|-54,464,726.76|
|-51,101,619.20|

 (2)Adjustmentprocessofaccountingprofitandincometaxexpense
Item Reportingperiod
Totalprofits -355,719,790.89 Currentincometaxexpenseaccountedbytaxandrelevantregulations -88,929,947.72 Influenceofdifferenttaxratesuitabletosubsidiary
15,150,525.69 Influenceofincometaxbeforeadjustment
1,224,003.30 Influenceofnontaxableincome
-503,724.74
Influenceofnon-deductablecosts,expensesandlosses
-1,563,504.99
—
Influence of deductable losses of deferred income tax assets derecognized used
2015Semi-annualReportofKonkaGroupCo.,Ltd. inpreviousperiod
Influence of deductible temporary difference or deductible losses of deferred
27,516,303.23 incometaxassetsderecognizedinreportingperiod.
Changes of the balance of deferred income tax assets/ liabilities in previous
— periodduetoadjustmentoftaxrate
Other -3,995,273.97 Deferredincometax -51,101,619.20 49.Supplementary information to cash flowstatement
(1)Other cash received relevant to operating activities
||
|-|
|Reportingperiod|
|63,116,201.19|
|50,806,977.96|
|25,280,539.71|
|17,710,940.97|
|7,399,974.01|
|4,012,389.68|
|3,677,654.89|
|2,879,986.02|
|585,764.95|
|175,470,429.38|

 (2)Other cash paid relevant to operating activities
||
|-|
|Reportingperiod|
|460,136,035.36|
|54,634,052.75|
|3,202,027.62|
|15,101,732.17|
|7,520,596.52|
|36,000.00|
|41,859,725.05|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||
|-|
|Reportingperiod|
|582,490,169.47|

 (3)Other cash received relevant to investment activities
||
|-|
|Reportingperiod|
|1,300,500,000.00|
|488,063,979.00|
|1,788,563,979.00|

 (4)Other cash paid relevant to investmentactivity
||
|-|
|Reportingperiod|
|1,301,000,000.00|
|5,784,590.00|
|150,362.07|
|1,306,934,952.07|

 (5)Other cash received relevant to financing activities
||
|-|
|Reportingperiod|
|118,095,176.56|
|—|
|118,095,176.56|

 (6)Other cash paid relevant to financing activities
||
|-|
|Reportingperiod|
|132,986,357.83|
|875,603.76|
|—|
|133,861,961.59|

2015Semi-annualReportofKonkaGroupCo.,Ltd. 50.Supplemental information forCash FlowStatement
(1)Supplemental information for Cash Flow Statement
||
|-|
|Reportingperiod|
|-304,618,171.69|
|37,744,452.91|
|72,037,148.23|
|6,114,059.53|
|10,613,072.64|
|1,192,849.90|
|—|
|—|
|99,380,910.41|
|7,185,454.13|
|-60,779,263.28|
|6,341,583.07|
|155,252,082.46|
|706,029,496.58|
|-666,450,765.26|
|—|
|70,042,909.63|
|—|
|—|
|—|
|2,036,481,117.08|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||
|-|
|Reportingperiod|
|1,640,236,837.08|
|—|
|—|
|396,244,280.00|

 (2)Cash and cash equivalents
||
|-|
|Reportingperiod|
|2,036,481,117.08|
|193,395.85|
|2,036,287,721.23|
|—|
|—|
|2,036,481,117.08|

 51.Theassets with theownership oruserightrestricted
||
|-|
|Closingbookvalue|
|79,197,475.64|
|79,197,475.64|
|1,859,532,420.12|
|228,784,531.60|
|1,561,200,609.03|
|69,547,279.49|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||
|-|
|Closingbookvalue|
|1,938,729,895.76|

52.Foreigncurrency monetary items
|||
|-|-|
|Closingforeigncurrencybalance|Exchangerate|
|59,503,307.86|6.11360|
|18,074.99|6.86990|
|10,177,076.92|0.78861|
|6.96|4.92320|
|1.32|9.64220|
|3,862,106,443.89|0.00046|
|108,214,434.99|6.11360|
|4,397,500.18|0.78861|
|8,805,336,193.38|0.00046|
|49,764.00|4.69930|
|490,921.91|6.11360|
|38,083.40|6.86990|
|93,071.11|0.78861|
|334,708,034.00|0.00046|
|41,632,641.35|6.11360|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
|||
|-|-|
|Closingforeigncurrencybalance|Exchangerate|
|28,062,677.73|0.78861|
|53,547,264,737.98|0.00046|
|1,079,430.85|6.86990|
|596,961,903.61|6.11360|
|53,010,841.64|6.8699|
|96,970,000.00|6.11360|

 IX. Changesof merge scope
1.Business merger notunder samecontrol
Singledisposal ofinvestment to subsidiary that losing control
||||||
|-|-|-|-|-|
|Theequitydisposalprice|Equitydisposalproportion(%)|Methodofequitydisposal|Timeoflosingcontrol|Recognitionbasisofthetimeoflosingcontrol|
|—|100.00|Cancel|2015-2-9|Cancellationprocedurewascompleted|

(Continued)
||||||
|-|-|-|-|-|
|Residualequityproportiononthedateoflosingcontrol(%)|Bookvalueofresidualequityonthedateoflosingcontrol|Fairvalueofresidualequityonthedateoflosingcontrol|Profitsorlossesofresidualequityrecalculatedinlinewithfairvalue|Recognitionmethodandmainassumptionoffairvalueofresidualequityonthedateoflosingcontrol|
|—|—|—|—|—|

2015Semi-annualReportofKonkaGroupCo.,Ltd. 2.Changeof mergerscopedueto otherreasons
(1) Shenzhen Konka Precision Mold Manufacturing Co., Ltd and Mansfield Technology (Taiwan) Co., Ltd, our subsidiaries contributed capital jointly and founded Anhui Jiasen Precision Technology Co., Ltd on December 22, 2014. Its registered capital was RMB 20 million, and it was paid in full amount by all the stockholders by September 30, 2015. In it, Shenzhen Konka Precision Mold Manufacturing Co., Ltd subscribed to RMB1.02 million, which occupied51% of the registered capital by means of contribution in currency, Mansfield Technology (Taiwan) Co., Ltd subscribed to RMB9.80 million, which occupied49% of the registered capital by means of contribution in RMB. By the date of the balance sheet, Shenzhen Konka Precision Mold Manufacturing Co., Ltd contributed RMB7.65 million, which occupied38.25% of the registered capital, and MansfieldTechnology (Taiwan) Co., Ltd contributed RMB4.8998million, which occupied24.50% of the registered capital. The Company has right of control over it, and included it into its merger scope from January 1,2015.
(2)The Company contributed capital with Shenzhen Kaikai Shijie Investment Partnership Enterprise (limited partnership) jointly and founded Anhui Kakai Shijie E-Commerce Co., Ltd on December 29, 2014, with a registered capital of RMB20 million. In it, the Company contributed RMB16 million, which occupied80% of the registered capital. Shenzhen Kaikai Shijie Investment Partnership Enterprise (limited partnership) contributed RMB 4.0 million, which occupied20% of the registered capital. The Company has right of control over it, and included itinto itsmerger scope from January 1,2015.
(3) The Company contributed capital with Shenzhen Yizhonghui Technology Co., Ltd and Shenzhen Yizhonghe Technology Co., Ltd jointly and founded Shenzhen Yipingfang Network Technology Co., Ltd, with a registered capital of RMB20 million on January 9, 2015. In it, the Company contributed RMB19.20million, which occupied96% of the registered capital, the other stockholders contributed RMB800, 000, which occupied4% of theregistered capital, but the capital had not been contributed by thedate of the balance sheet. The Company has right of control over it, and included it into its merger scope from January 9,2015.
(4) The Company contributed capital with OCT Group jointly and founded Shenzhen Kangqiaojiacheng Property Investment Co., Ltd, with a registered capital of RMB10 billion on January 9, 2015, which will be paid in full amount by all the stockholders by December 31, 2019. In it, the Company subscribed to RMB700 million by means of contribution in RMB, which occupied70% of the registered capital, OCT Group contributed to RMB300
2015Semi-annualReportofKonkaGroupCo.,Ltd. million by means of contribution in RMB, which occupied30% of the registered capital. By the date of the balance sheet, the Company contributed RMB112 million, which occupied11.20% of the registered capital; OCT Group contributed RMB48 million, which occupied4.8% of the registered capital. The Company has right of control over it, and included it into itsmergerscope from January 19,2015.
(5) Kangdian Investment Development Co., Ltd, a subsidiary of the Company, contributed capital jointly with KK Orient Limited and founded Konka Smarttech Limited on January 21, 2015, with a registered capital ofHK$10million. In it, Kangdian Investment Development Co., Ltd contributedHK$6.10 million, which occupied61% of the registered capital and Konka Smarttech Limited contributedHK$3.90 million, which occupied39% of the registered capital. The Company has right of control over it, and included it into its merger scopefrom January 21,2015.
(6) Shenzhen Konka Yishijie Commercial Display Co., Ltd, a subsidiary of the Company contributed capital and founded Shenzhen Konka Yishijie Commercial Display Service Co., Ltd, a wholly-funded subsidiary under it on May 7, 2015, with a registered capital of RMB2.00 million. The Company has right of control over it, and included it into its merger scopefrom May 7,2015.
2015Semi-annualReportofKonkaGroupCo.,Ltd. X.Equity in otherentities
1.Equity insubsidiary
(1)The structure oftheenterprisegroup
||||||
|-|-|-|-|-|
|Mainoperatingplace|Registration place|Natureofbusiness|Proportionofshareholding||
||||Directly|Indirectly|
|Shenzhen,Guangdong|Shenzhen,Guangdong|Manufacture|75.00|25.00|
|·Shenzhen,Guangdong|Shenzhen,Guangdong|Manufacture|—|46.31|
|Shenzhen,Guangdong|Shenzhen,Guangdong|ElectricalAppliancesRetail|100.00|—|
|Shenzhen,Guangdong|Shenzhen,Guangdong|Manufacture|75.00|25.00|
|Shenzhen,Guangdong|Shenzhen,Guangdong|Manufacture|49.00|51.00|
|Shenzhen,Guangdong|Shenzhen,Guangdong|Manufacture|75.00|25.00|
|Shenzhen,Guangdong|Shenzhen,|Investmentholding|75.00|25.00|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||||
|-|-|-|-|-|
|Mainoperatingplace|Registration place|Natureofbusiness|Proportionofshareholding||
||||Directly|Indirectly|
||Guangdong||||
|Mudanjiang,Heilongjiang|Mudanjiang,Heilongjiang|Manufacture|60.00|—|
|Chongqing|Chongqing|Manufacture|57.00|—|
|Chongqing|Chongqing|Manufacture|—|40.00|
|Chuzhou,Anhui|Chuzhou,Anhui|Manufacture|78.00|—|
|Chuzhou,Anhui|Chuzhou,Anhui|Manufacture|—|100.00|
|Changshu,Jiangsu|Changshu,Jiangsu|Manufacture|—|60.00|
|Kunshan,Jiangsu|Kunshan,Jiangsu|Manufacture|100.00|—|
|Dongguan,Guangdong|Dongguan,Guangdong|Manufacture|75.00|25.00|
|Dongguan,Guangdong|Dongguan,Guangdong|Manufacture|—|100.00|
|Dongguan,Guangdong|Dongguan,Guangdong|Manufacture|—|59.73|
|Boluo， Guangdong|Boluo，Guangdong|Manufacture|—|51.00|
|Boluo,Guangdong|Boluo,Guangdong|Manufacture|—|100.00|
|HongKong,China|HongKong,China|Hong Kong Konka|100.00|—|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||||
|-|-|-|-|-|
|Mainoperatingplace|Registration place|Natureofbusiness|Proportionofshareholding||
||||Directly|Indirectly|
|||Co.,Ltd.|||
|HongKong,China|HongKong,China|Konka HouseholdAppliancesInvestment &Development Co.,Ltd.|—|100.00|
|HongKong,China|HongKong,China|KonkaHouseholdAppliancesInternationalTradingCo.,Ltd.|—|100.00|
|TheUSA|TheUSA|International trade|100.00|—|
|Frankfurt, Germany,Europe|Frankfurt, Germany,Europe|International trade|100.00|—|
|DongguanGuangdong|DongguanGuangdong|Manufacture|—|46.31|
|GuangdongShenzhen|GuangdongShenzhen|Softwaredevelopment|100.00|—|
|GuangdongShenzhen|GuangdongShenzhen|Softwaredevelopment|100.00|—|
|KunshanJiangsu|KunshanJiangsu|Realestate|100.00|—|
|ChuzhouAnhui|ChuzhouAnhui|Manufacture|100.00|—|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||||
|-|-|-|-|-|
|Mainoperatingplace|Registration place|Natureofbusiness|Proportionofshareholding||
||||Directly|Indirectly|
|Indonesia|Indonesia|International trade|—|51.00|
|GuangdongShenzhen|GuangdongShenzhen|Logistics|100.00|—|
|Beijing|Beijing|Saleofhomeappliance|100.00|—|
|KunshanJiangsu|KunshanJiangsu|Manufacture|—|46.31|
|WuhanHubei|WuhanHubei|Manufacture|—|46.31|
|ChuzhouAnhui|ChuzhouAnhui|Manufacture|—|46.31|
|GuangdongShenzhen|GuangdongShenzhen|Manufacture|60.00|—|
|GuangdongShenzhen|GuangdongShenzhen|Manufacture||60.00|
|FujianXiamen|FujianXiamen|Commerce|—|69.23|
|Tianjin|Tianjin|Other|—|70.00|
|Anhui|Anhui|Manufacture|—|23.62|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||||
|-|-|-|-|-|
|Mainoperatingplace|Registration place|Natureofbusiness|Proportionofshareholding||
||||Directly|Indirectly|
|GuangdongShenzhen|GuangdongShenzhen|Realestate|70.00|—|
|HongKong,China|HongKong,China|Other|—|61.00|
|Anhui|Anhui|E-commerce|80.00|—|
|GuangdongShenzhen|GuangdongShenzhen|Informationservice|96.00|—|

2015Semi-annualReportofKonkaGroupCo.,Ltd. Notes:① The Company holds46.31% of shares of Shenzhen Konka Precision Mold Manufacturing Co., Ltd., Konka Household Appliances Investment& Development Co., Ltd, a subsidiary company of the Company, is entrusted to manage6.18% shares held by Shenzhen Dingshengxin Mould Technology Consultation Co., Ltd. After the entrustment, the percentage of voting rights of the Company increases to52.49%. Therefore, the financial statements of Shenzhen Konka Precision Mold Manufacturing Co., Ltd. are combined into the consolidated financial statements. Xutongda is a wholly funded subsidiary of Dongguan Konka Mould Plastic Co., Ltd and is also combined into the consolidated financial statements.
② The Company holds40.00% shares of Chongqing Qingjia Electronic Co., Ltd. that all senior managers of Chongqing Qingjia Electronic Co., Ltd. are appointed and dismissed by the Company. Among the directors, half of them or over half are dispatched directly or indirectly by the Company. Moreover, in Chongqing Qingjia, 70% to80% of its products are sold to the Company and thus the Company has absolute influence and control over the production and operation of Chongqing Qingjia Electronic Co., Ltd., which is combined intotheconsolidated financial statement.
③ Shenzhen Konka Precision Mold Manufacturing Co., Ltd. held100% equity of Dongguan Xutongda Mould Plastic Co., Ltd., and the Company is the actual controller of Dongguan Xutongda Mould Plastic Co., Ltd., for the Company indirectly held46.31% shares and52.49% voting right of Dongguan Xutongda Mould Plastic Co., Ltd., which is combined intotheconsolidated financial statement.
④ Anhui Tongchuang is a limited company jointly invested and established by the Company and Chuzhou Tongchuang Construction Investment Co., Ltd. (hereinafter refer to as “Tongchuang Construction”) with registration capital of RMB 180 million, of which each party invested in RMB 90 million respectively on contract.As to 31 Dec. 2010,Anhui Tongchuang with a paid-up capital of RMB 120 million (including paid-up capital of RMB 90 million of theCompany,75.00% of total paid-up capital; and paid-up capital of RMB 30 million of Tongchuang Construction,25.00% of total paid-up capital ). According to contract sign by two parties, Tongchuang Construction has the rights of transferring stock ownership three years after the establishment of Anhui Tongchuang Company. Meanwhile, the Company can repurchase the said stock ownership and contracted with Tongchuang Investment Company that the Company shall receive fixed investment gains at2% of actual capital invested by the Group annually. So the Company can conduct actual control toAnhuiTongchuang Company,and combines it intotheconsolidated financial statement.⑤ Precision Mould held100% equity of Kunshan Jielunte, Wuhan Jielunte and Chuzhou Jielunte and was actually controlled by the Company.The Company indirectly held46.31% equity of Jielunte and the52.49% voting right of it, which is combined into the consolidated financial statement.
2015Semi-annualReportofKonkaGroupCo.,Ltd. (2)Significant not wholly ownedsubsidiary
||||
|-|-|-|
|Shareholdingproportionofminorityshareholder|Theprofitsandlossesarbitratetotheminorityshareholders|Declaringdividendsdistributetominorityshareholder|
|53.69|541,887.63|—|
|22.00|-3,554,554.48|—|
|40.27|-3,358,327.79|—|
|53.69|3,869,565.90|—|

(3)Themain financial information ofsignificant not whollyowned subsidiary
Closingbalance
||||||
|-|-|-|-|-|
|Currentassets|Non-currentassets|Total assets|Current liabilities|Non-currentliability|
|63,252,508.15|177,844,217.80|241,096,725.95|161,239,670.19|—|
|1,056,404,598.05|242,410,754.00|1,298,815,352.05|1,022,333,767.36|6,813,287.87|
|236,376,313.43|57,389,798.18|293,766,111.61|176,320,890.63|3,164,404.52|
|74,140,483.20|8,556,458.23|82,696,941.43|52,999,867.82|262,469.02|

(Continued)
Openingbalance
||||||
|-|-|-|-|-|
|Currentassets|Non-currentassets|Total assets|Current liabilities|Non-currentliability|
|73,933,646.66|170,997,722.16|244,931,368.82|163,885,285.19|—|

2015Semi-annualReportofKonkaGroupCo.,Ltd. Name Openingbalance
||||||
|-|-|-|-|-|
|530,345,042.25|228,358,246.18|758,703,288.43|469,762,019.50|7,371,847.37|
|246,221,614.74|55,571,226.68|301,792,841.42|176,470,898.07|2,819,541.37|
|82,414,688.51|10,115,814.00|92,530,502.51|70,336,314.72|—|

||||
|-|-|-|
|Reportingperiod|||
|Operatingrevenue|Netprofits|Totalcomprehensiveincome|
|56,309,090.66|-1,189,027.87|-1,189,027.87|
|2,428,514,346.89|-11,901,124.74|-11,901,124.74|
|82,998,859.63|-8,221,585.52|-8,221,585.52|
|84,103,163.49|7,240,416.80|7,240,416.80|

||||
|-|-|-|
|Sameperiodoflastyear|||
|Operatingrevenue|Netprofits|Totalcomprehensiveincome|
|57,300,778.12|-1,260,788.91|-1,260,788.91|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||
|-|-|-|
|Sameperiodoflastyear|||
|1,950,159,308.59|-10,849,659.81|-10,849,659.81|
|145,203,294.42|4,508,902.22|4,508,902.22|
|80,172,167.88|5,374,021.36|5,374,021.36|

 2.Equity injointventure
(1)Significant joint venture
||||||
|-|-|-|-|-|
|Mainoperatingplace|Registrationplace|Businessnature|Proportion(%)||
||||Directly|Indirectly|
|Shenzhen|Shenzhen|Manufacturing andsellingLEDs|—|6.79|
|Shanghai|Shanghai|Manufacturing andsellingLEDs|—|26.45|
|Shanghai|Shanghai|Manufacturing andsellingLEDs|39.00|—|

2015Semi-annualReportofKonkaGroupCo.,Ltd. (2)Main financial information ofsignificant jointventure
||||
|-|-|-|
|EnrayTekOptoelectronic(Shanghai)Co.,Ltd.|ShanghaiKonkaGreenScienceandTechnologyCo.,Ltd.|EnrayTekOptoelectronic(Shanghai)Co.,Ltd.|
|341,730,366.36|475,063,721.57|268,409,318.7|
|639,724,830.29|232,632,671.64|606,856,639.67|
|981,455,196.65|707,696,393.21|875,265,958.44|
|439,424,290.39|102,711,613.48|355,102,547.52|
|247,268,850.06|95,504,437.10|232,930,605.06|
|686,693,140.45|198,216,050.58|588,033,152.58|
|622.12|7,018,936.66|68.50|
|294,761,434.08|502,461,405.97|287,232,737.36|
|77,971,539.01|195,959,948.33|80,536,808.37|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||
|-|-|-|
|EnrayTekOptoelectronic(Shanghai)Co.,Ltd.|ShanghaiKonkaGreenScienceandTechnologyCo.,Ltd.|EnrayTekOptoelectronic(Shanghai)Co.,Ltd.|
|30,257,135.84|—|30,257,135.84|
|—|—|—|
|—|—|—|
|108,228,674.85|195,959,948.33|110,793,944.21|
|—|—|—|
|78,019,124.12|71,478,992.66|49,861,829.96|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||
|-|-|-|
|EnrayTekOptoelectronic(Shanghai)Co.,Ltd.|ShanghaiKonkaGreenScienceandTechnologyCo.,Ltd.|EnrayTekOptoelectronic(Shanghai)Co.,Ltd.|
|-17,970,749.66|-7,998,708.70|-3,204,359.66|
|—|—|—|
|—|—|—|
|-17,970,749.66|-7,998,708.70|-3,204,359.66|
|—|—|—|

2015Semi-annualReportofKonkaGroupCo.,Ltd. XI. Risksrelated to financial instruments
Main financial instruments include monetary capital, accounts receivable and accounts payable. Refer to Note XI for the details of all financial instruments. Risks related to financial instruments and risk management policies to reduce risks are as follows. The management should control and monitor the risk exposure to ensure all risks within defined scope.
The Company uses sensitive analysis to analyze rationality of risk variables and possible influences to current profits and losses or equity interests. Because risk variables are not happened independently, correlation of variables to certain risk variable may affect the final amount. Therefore, the following items are conducted under assumptions of each variable changing independently.
(1)Risk management objectives andpolicies
Risk management objective of the Company is to balance the risks and profits, minimize the negative effects to business performance and maximize the profits for stockholders and other equity investors. On the basis of risk management objectives, basic strategies of risk management are to determine and analyze all possible risks, establish appropriate risk baseline, control and manage risks and monitor all risks timely and reliably within defined scope.
1.Marketrisk
(1)Foreign exchange risk
Foreign exchange risk refers to the risks that may lead to losses due to fluctuation in exchange rate. The foreign exchange risk borne by the Company is related to US dollars, except the procurement and sales by US dollars for several subsidiaries. Until December 31, 2015 (refer to Note VI 51, foreign monetary items), foreign exchange risks may affect the business performance produced bytheassets and liabilities ofthebalance.
(2)Interest rate risk-cash flowchange risk
Cash flow change risk caused by financial instruments due to interest rate change is related to floating interest rate of bank loan. By establishing good relations with banks and reasonable planning of credit line, credit varieties and credit period, it is to guarantee sufficient band line of credit and satisfy all financial demands. Moreover, it is to reduce risks of interest rate uncertaintybyshortening single loan term andestablishing repayment terms.
(3)Other price risks
2015Semi-annualReportofKonkaGroupCo.,Ltd. For the equity investment of other listed companies holding by the Company, the management considers that the market price risks are acceptable. Refer to Note VI, 9 Available-for-sale financial assets for equity investment of other listed companies holding by theCompany.
2.Creditrisk
On 30 Jun. 2015, the biggest credit risk exposure may lead to the financial assets losses of the Company was mainly from the one party fail to perform its obligation, which included: book amount recognized in consolidated balance sheet: for financial instruments measured at fair value, the book value reflect its risk exposure, but not the biggest one, the biggest risk exposurewillchange along with thechange of futurefair value.
In order the reduce the credit risk, the Company establish a group response for recognizing line of credit, conducting credit approval and other monitor procedures to ensure that the necessary measures were used to recycle expired claims. In addition, the Company, on each balance sheet date, reviews every single receivable recycling situation, to ensure that the money unable to recycle withdraw fully provision for bad debt. Thus, the management of the Company believed that theCompany had greatly reduced the creditrisk.
TheCompany’s working capital was deposit in bank with better risk management, thus the risk ofworking capital was low.
3.Liquidity risk
When managing liquidity risk, the Company maintained themanagement’s believe that supervising the sufficient cash and cash equivalents to meet the operating demand of the Company and reduce the influence of the fluctuation of cash flow. The management of the Company supervised the usage of bank loan and ensured complying with borrowing agreement.
XII. Thedisclosureofthe fairvalue
1.Closingfairvalueof assets andliabilities calculated byfairvalue
Closingfairvalue
||||
|-|-|-|
|Fairvaluemeasurementitemsatlevel1|Fairvaluemeasurementitemsatlevel2|Fairvaluemeasurementitemsatlevel3|

2015Semi-annualReportofKonkaGroupCo.,Ltd. Closingfairvalue
||||
|-|-|-|
|Fairvaluemeasurementitemsatlevel1|Fairvaluemeasurementitemsatlevel2|Fairvaluemeasurementitemsatlevel3|
|—|—|—|
|1,796,971.20|—|—|
|—|—|—|
|1,796,971.20|—|—|
|—|—|—|

2. The basis for determining market price of continual and non-continual level-1 fair valuemeasurement items
By the end of the year, the Company held 117,310.00 shares of stock A of Vanke, and their fair value at the end of the year was determined to be RMB1, 703, 341.20 according to closing price of RMB14.52 for each share on June 30, 2015. It held 500 shares of stock of Bobaolon, and their fair value at the end of the year was determined to be RMB20, 290.00 according to closing price of RMB40.58 for each share on June 30, 2015. It held 500 shares of stock of Soling, and their fair value at the end of the year was determined to be RMB17, 005.00 according to closing price of RMB34.01 for each share on June 30, 2015. It held 500 shares of stock of Science Sun, and their fair value at the end of the year was determined to be RMB33, 500.00 according to closing price of RMB67.01 for each share on June 30, 2015. It held 500 shares of stock of Junesun Fungi, and their fair value at the end of the year was determined to be RMB11, 325.00 according to closing price of RMB22.65 for each share on June 30, 2015. It held 500 shares of stock of Puyang Huicheng, and their fair value at the end of the year was determined to be RMB6, 575.00 according to closing price of RMB13.15 for each share on June 30, 2015. It held 500 shares of stock of Kedi Dairy, and their fair value at the end of the year was determined to be RMB4, 930.00 according to closing price of RMB9.86 for each share onJune30,2015.
XIII. Related party and related Transaction
1.Information ofsubsidiary oftheCompany
Details ofinformation ofsubsidiary oftheCompany see note1.Equity insubsidiaryVIII
2015Semi-annualReportofKonkaGroupCo.,Ltd. 2.Information onthe jointventures of theCompany
The details of significant joint venture of the Company see note 10. Long term equity investmentVI
3.Information onotherrelated parties oftheCompany
Name Relationship
ShenzhenOCTEastCo.,Ltd.
Underthesameactualcontroller
ShanghaiOCTInvestmentDevelopmentCo.,Ltd.
Underthesameactualcontroller
Chengdu Tianfu OCT Industrial Development Co.,
Underthesameactualcontroller
Ltd.
ShanghaiTianxiangOCTInvestmentCo.,Ltd.
Underthesameactualcontroller
AnhuiHualiPackagingCo.,Ltd.
Underthesameactualcontroller
ShenzhenOCTWaterandPowerCo.,Ltd
Underthesameactualcontroller
ShanghaiOCTInvestmentDevelopmentCo.,Ltd.
Underthesameactualcontroller
ShanghaiHualiPackagingCo.,Ltd
Underthesameactualcontroller
ShenzhenHuayouPackagingCo.,Ltd
Underthesameactualcontroller
ShenzhenHualiPacking&TradingCo.,Ltd
Underthesameactualcontroller
HualiPackaging(Huizhou)Co.,Ltd.
Underthesameactualcontroller
HuizhouHualiPackagingCo.,Ltd.
Underthesameactualcontroller
Shenzhen Overseas Chinese Town Gas Station Co.,
Underthesameactualcontroller
Ltd.
Shenzhen Konka Video& Communication Systems
Underthesameactualcontroller
EngineeringCo.,Ltd.
TaizhouOCTCo.,Ltd
Underthesameactualcontroller
ShenzhenOCT RealEstateCo.,Ltd.
Underthesameactualcontroller
ShenzhentheWindowsoftheworldCo.,Ltd.
AssociatedenterpriseoftheCompany
TianjinOCTIndustryCo.,Ltd.
Underthesameactualcontroller
YunnanOCTIndustryCo.,Ltd.
Underthesameactualcontroller
ShenzhenOCTHotelCo.,Ltd.
Underthesameactualcontroller
ShenzhenSplendidChinaDevelopmentCo.,Ltd
AssociatedenterpriseoftheCompany
2015Semi-annualReportofKonkaGroupCo.,Ltd. ShenzhenOCTEastInterlakenHotel
Underthesameactualcontroller
ShenzhenOCTPropertyManagementCo.,Ltd.
Underthesameactualcontroller
4.Listof related-party transactions
(1)Information onacquisition ofgoods and reception oflabor service
|||
|-|-|
|Content|2015|
|Purchasematerials|47,882,999.94|
|Purchasematerials|13,685,714.34|
|Water&Electricity|2,982,321.50|
|Purchasematerials|5,062,131.26|
|Purchasematerials|5,313,689.89|
|Purchasematerials|456,923.11|
|Purchasematerials|155,425.55|

 Transactions ofselling commodities andproviding laborservices
|||
|-|-|
|Content|2015|
|SellingLCDs,maintenancecost|—|
|Advertising|18,868,462.33|
|Sellingmaterials|10,381,121.06|
|Repairprocessingfeeincome|—|
|SellingLCDs|—|
|SellingLCDs|—|
|SellingLCDs,maintenancecost|374,606.74|

(2)Related trusteeship/contract
|||||||
|-|-|-|-|-|-|
||Guaranteeamount(TenThousandYuan)|currency|Actualusingamount(TenThousandYuan)|Startdate|Enddate|
|curren||||||
|cy||||||
|RMB|30,000.00|RMB|4,950.00|2015-1-30|2016-1-29|
|||RMB|2,000.00|2015-6-2|2016-6-1|
|||RMB|—|2014-11-18|2015-11-17|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||||||
|-|-|-|-|-|-|-|
||RMB|30,000.00|RMB|5,214.15|2014-12-26|2015-12-26|
||RMB|20,000.00|RMB|7,761.57|2014-12-26|2015-12-26|
||||RMB|610.79|2015-3-12|2016-3-12|
||||RMB|1,997.67|2015-4-10|2016-4-10|
||||RMB|3,537.20|2015-5-14|2016-5-14|
||||RMB|4,259.39|2015-5-19|2016-5-19|
||RMB|4,800.00|RMB|298.91|2015-1-27|2016-1-27|
||RMB|50,000.00|RMB|8,351.29|2015-4-22|2016-4-21|
||RMB|10,000.00|RMB|—|2015-1-28|2016-1-28|
||RMB|14,800.00|RMB|14,800.00|2015-4-1|2015-12-15|
||USD|4,000.00|USD|4,000.00|2015-6-26|2016-6-26|
||USD|2,470.00|USD|2,470.00|2015-3-23|2016-3-23|
||USD|2,530.00|USD|2,530.00|2015-5-29|2016-5-29|
||USD|1,000.00|USD|1,000.00|2014-10-10|2015-10-9|
||RMB|7,800.00|USD|1,215.00|2014-11-12|2015-11-10|
||USD|3,000.00|USD|3,000.00|2014-11-17|2015-12-17|
||USD|4,500.00|USD|4,500.00|2014-11-20|2015-12-18|
||USD|5,000.00|USD|4,850.00|2014-1-15|2016-2-14|
||USD|6,910.00|USD|6,700.00|2014-7-28|2016-8-27|
|DongguanKonkaMouldPlasticCo.,Ltd.|RMB|3,000.00|RMB|2,140.00|2013-9-29|2016-9-29|
|Kunshan Geraint Mould|RMB|10,000.00|RMB|2,925.65|2015-1-21|2015-12-18|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||
|-|
|PlasticCo.,Ltd.|

Note: Anhui construction of chuzhou city, Co., Ltd. a minority shareholder of Anhui Konka Tongchuang Household Appliances Co., Ltd. for the amount of guarantees provided50% counter-guarantee.
②, minority shareholders of Anhui Konka Electronic Co., Ltd. provide guarantees of the company'slineof22% thecounterguarantee.
③ subsidiary Shenzhen subsidiary Kunshan jielunte precision provided amount to RMB 30 millionYuan fixed assets loan guarantee.
④ subsidiary Shenzhen precision to provide subsidiary Dongguan mold amount security of RMB100million forissuing notes, loan.
(3)Rewards for thekey management personnel
||
|-|
|2015|
|5.1135 million|

 5.Receivablesand payables ofrelated parties
(1)Receivables
||||
|-|-|-|
|Closingbalance|||
|Bookbalance|Baddebtprovision|Bookbalance|
|11,037,967.18|278,103.84|10,963,653.88|
|131,099.44|2,621.99|—|
|8,775,156.27|175,503.13|7,478,269.37|
|—|—|1,260,956.45|
|19,944,222.89|456,228.96|19,702,879.70|
|18,115,952.51|5,058,104.93|18,115,952.51|
|80,000.00|80,000.00|80,000.00|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||
|-|-|-|
|Closingbalance|||
|Bookbalance|Baddebtprovision|Bookbalance|
|1,209,064.86|1,209,064.86|1,209,064.86|
|77,402.65|77,402.65|77,402.65|
|763,410.76|15,268.22|776,572.25|
|20,245,830.78|6,439,840.66|20,258,992.27|

 (2)Account payables
||
|-|
|Closingbalance|
|750,302.22|
|4,205,725.70|
|1,078,005.09|
|1,402,269.39|
|358,929.03|
|1,141,905.38|
|1,525,624.20|
|10,462,761.01|
|3,028,381.67|
|1,334,828.63|
|2,221,119.77|
|1,169,600.00|
|7,753,930.07|
|32,637,408.00|
|—|
|32,637,408.00|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||
|-|
|Closingbalance|
|1,130,000.00|
|1,530,000.00|
|428,000.00|
|51,135.00|
|3,139,135.00|

 XIV. Commitments
1.Significantcommitments
(1)Capital commitment
||
|-|
|Closingbalance|
|—|
|93,536,361.57|
|—|
|93,536,361.57|

 (2)Operating lease commitments
As of the end of balance sheet date, the irrevocable operating lease commitments that the Company signed were as followed:
||
|-|
|Closingbalance|
|22,008,951.96|
|13,369,023.53|
|12,024,300.37|
|3,874,680.65|
|51,276,956.51|

2015Semi-annualReportofKonkaGroupCo.,Ltd. 2.Contingency
1. Contingent liabilities and its financial effect arising from unsettled litigation or arbitration
1.Contingent liabilities and financial effects caused bypending litigation or arbitration
On 4 Feb. 2013, theCompany’s subsidiary Kunshan Konka signed Purchase Order (Hereinafter referred to as "PO") with Italy customer MOTOM ELECTRONICS GROUP SPA(Hereinafter referred to as the "MEG"). The PO payment was 90 days L/C, L/C amount was$1.29744 million. MEG opened L/C which Kunshan Konka was beneficiary on 26 Feb, due to the problems of delivery time and related items, after the agreement of both parties, MEG respectively opened two revisions of L/C on 11 Mar. and 13 May. Then the Kunshan Konka entrusted Ningbo United International Freight Forwarding Co., Ltd. (Hereinafter referred to as the “Ningbo United”) to book space, and Ningbo United signed and issued the carrier's bill of lading of Econolines Ltd. (Hereinafter referred to as the “Econolines” (No.NGB1305005\GNB1305016\NGB1305034) The whole case handover with Container delivery conditions of CYTO CY) on 5, 14 and 19 May 2013.According to the verification, after the goods arrived to the port of destination in Italy, the empty cargo container had returned to the shipping company, but the full set of original bill of lading was still in Kunshan Konka; Ningbo United andEconolines’s behaviors of delivery of goods without original bill of lading had violated the "maritime law" and other relevant laws and regulations, Kunshan Konka had right to require Econolines return the goods. The total amount of the goods was$ 1,214,780.04, equivalents RMB 7,507,340.65, MEG received the goods but not pay the full amount of the goods to Kunshan Konka, the amount in arrear reached$1,100,000.00.
Which caused large loss to Kunshan Konka, the payment in arrears of MEG to Kunshan Konkawas USD1,099,423.52
Kunshan Konka entrusted Shanghai Jiajia Law firm to file a suit from Shanghai Maritime Court, requested Ningbo United and Econolines compensate for the loss of payment for goods USD 1,099,423.52 and its interest; meanwhile bear the fees for acceptance and property preservation application fee
On 26 May 2014, Shanghai Maritime Court made the first-instance judgment, which ordered Ningbo United and Econolines compensate for the loss of payment for goods USD 1,099,423.52 and its interest, and bear the fees for acceptance and property preservation application fee
In Jun. 2014 Ningbo United appealed to the Shanghai Higher People's Court against its sentence. Now the case waits for a second trial. On 24 Nov. 2014, the Second-instance trial, pending at present
(2) Possible liabilities formed for providing debt guarantee for other institutions and their financial impacts
The Company applied to China Construction Bank, Hong Kong Branch for a credit line of USD 50 million (about RMB305.68 million) on January 15, 2014 and provided a loan of USD48.50 million on January 15, 2014, and this credit line had been used up by June 30, 2015.
The Company applied to China Construction Bank, Shenzhen Branch for a credit line by letter of guarantee of USD69.10 million (about RMB422.8229 million) on July 23, 2014, and
2015Semi-annualReportofKonkaGroupCo.,Ltd. provided a credit guarantee with a line of RMB409.973 million for Hong Kong Konka Co., Ltd on July 28, 2014, and its guarantee term was from July 28, 2014 to July 28, 2016. The line is mainly used by Hong Kong Konka Co., Ltd for the purposes of daily operating businesses such as opening and acceptance of letters of credit and acquiring financial loans from banks. By June30,2015,this linehad been used up.
The Company applied to HSBC Bank for a credit line by letter of guarantee of USD10 million (about RMB61.190 million) on October 10, 2014, and provided a credit guarantee with a line of RMB61.190 million for Hong Kong Konka Co., Ltd, and its guarantee term was from October 10, 2014 to October 10, 2015. The line is mainly used by Hong Kong Konka Co., Ltd for the purposes of daily operating businesses such as opening and acceptance of letters of credit and acquiring financial loans from banks. By June 30, 2015, thislinehad been used up.
The Company applied to Industrial and Commercial Bank of China, Xinian Sub-branch for a credit line by letter of guarantee of RMB78 million on November 8, 2014, and provided a credit guarantee with a line of RMB74.3459 million for Hong Kong Konka Co., Ltd, and its guarantee term was from November 12, 2014 to October 27, 2015. The line is mainly used by Hong Kong Konka Co., Ltd for the purposes of daily operating businesses such as opening and acceptance of letters of credit and acquiring financial loans from banks. By June 30,2015,thislinehad been used up.
The Company applied toAgricultural Bank of China, Shenzhen OCT Sub-branch for a credit line by letter of guarantee of USD30 million (about RMB183.570 million) on November 17, 2014, and provided a credit guarantee with a line of RMB183.570 million for Hong Kong Konka Co., Ltd, and its guarantee term was from November 17, 2014 to November 18, 2015. The line is mainly used by Hong Kong Konka Co., Ltd for the purposes of daily operating businesses such as opening and acceptance of letters of credit and acquiring financial loans from banks. By June30,2015,this linehad been used up.
The Company applied to Agricultural Bank of China, Shenzhen OCT Sub-branch for a credit line by letter of guarantee of USD45 million (about RMB275.355 million) on November 20, 2014, and provided a credit guarantee with a line of RMB275.355 million for Hong Kong Konka Co., Ltd, and its guarantee term was from November 20, 2014 to November 20, 2015. The line is mainly used by Hong Kong Konka Co., Ltd for the purposes of daily operating businesses such as opening and acceptance of letters of credit and acquiring financial loans from banks. ByJune 30,2015,thislinehad been used up.
The Company signed a Credit Line Contract with the serial number of BJ2014Z241JTBB-1 with China Construction Bank, Shenzhen Branch on December 8, 2014, and provided a credit guarantee with a line of RMB200million forAnhui Konka Electronics Co., Ltd, and its guarantee term was from December 8, 2014 to December 7, 2017.The line is mainly used by Anhui Konka Electronics Co., Ltd for the purposes of daily operating businesses such as opening and acceptance of letters of credit and acquiring financial loans from banks. By June 30, 2015, RMB 181,666,248.33 had been used in this line. Chuzhou State-owned Assets Operation Co., Ltd, a minority stockholder of Anhui Konka provided22% of counter guaranteeofthe lineguaranteed bytheCompany.
The Company provided a credit guarantee with a line of RMB300million for Anhui Konka Tongchuang Household Appliances Co., Ltd., and its guarantee term was from December 8, 2014 to December 7, 2017. The line is mainly used byAnhui Konka Tongchuang Household Appliances Co., Ltd. for the purposes of daily operating businesses such as opening and acceptance of letters of credit and acquiring financial loans from banks. By June 30, 2015,
2015Semi-annualReportofKonkaGroupCo.,Ltd. RMB 69,500,000.00 had been used in this line. Chuzhou Tongchuang Investment and Construction Co., Ltd., a minority stockholder of Toptry Electric Appliance Co., Ltd provided50% ofcounter guarantee of thelineguaranteed bytheCompany.
The Company signed a Credit Line Contract with the serial number of BJ2014Z241JTBB-2 with China Construction Bank, Shenzhen Branch on December 8, 2014, and provided a credit guarantee with a line of RMB300million for Kunshan Konka Electronic Co., Ltd., and its guarantee term was from December 8, 2014 to December 7, 2017. The line is mainly used by Kunshan Konka Electronic Co., Ltd. for the purposes of daily operating businesses such as opening and acceptance of letters of credit and acquiring financial loans from banks. By June30,2015, RMB52,141,467.59 in thislinehad been used.
The Company applied to Ping An Bank for a credit line by letter of guarantee of RMB148 million on March 27, 2015, and provided a credit guarantee with a line of RMB148 million for Hong Kong Konka Co., Ltd, and its guarantee term was fromApril 1, 2015 to December 15,2015.By June 30,2015,thislinehad been used up.
The Company applied to Bank of China, Shenzhen Branch for a comprehensive credit line of RMB5.3 billion on April 21, 2015, and provided a credit guarantee of RMB500 million for Shenzhen Konka Telecommunications Technology Co., Ltd. with its comprehensive credit line of RMB500 million onApril 22, 2015, and its guarantee term was fromApril 22, 2015 to April 21, 2016. The credit line is mainly used for the purposes of daily operating businesses such as opening and acceptance of letters of credit and acquiring financial loans from banks. By June 30, 2015, RMB83, 512, 861.55 in this line had been used. The Company provided a credit guarantee of RMB60 million for Shenzhen Konka Electric Appliance Co., Ltd on December 8, 2014, and its guarantee term was from December 8, 2015 to December 7, 2017. The credit line is mainly used for the purposes of daily operating businesses such as opening and acceptance of letters of credit and acquiring financial loans from banks. By June 30, 2015,RMB0 in thislinehad been used.
The Company opened a letter of guarantee agreement for tendering purpose with China Construction Bank, Nanshan Sub-branch (Contract No: 0701-154150150055) due to tendering need of ground digital television and broadcasting transmitting system of wireless digital coverage project for central broadcasting and television programs. Its beneficiary is China International Tendering Company, the amount covered by the letter of guarantee is RMB6.584 million and the term of letter of guarantee is from May 5, 2015 to September 2, 2015.
The Company applied to China Development Bank, Shenzhen Branch for a credit line by letter of guarantee of USD24.70 million on March 20, 2015, and provided a credit guarantee for Hong Kong Konka Co., Ltd on March 23, 2015, and its guarantee term was from March 23,2015toMarch 23,2016.ByJune 30,2015,thislinehad been used up.
The Company applied to China Development Bank, Shenzhen Branch for a credit line by letter of guarantee of USD25.30 million on May 29, 2015, and provided a credit guarantee for Hong Kong Konka Co., Ltd on May 29, 2015, and its guarantee term was from May 29, 2015toMay 29,2016.ByJune 30,2015,thislinehad been used up.
The Company applied to China Minsheng Banking Corp., Ltd, Shenzhen Branch for a credit line by letter of guarantee of USD40 million on June 19, 2015, and provided a credit guarantee of a lineof RMB148 million for Hong Kong Konka Co., Ltd onJune 26, 2015,and its guarantee term was from June 26, 2015 to June 26, 2016. By June 30, 2015, this line had been usedup.
By June 30, 2015, the Company opened commercial acceptance bills with a total amount of
2015Semi-annualReportofKonkaGroupCo.,Ltd. RMB41, 227, 166.17 for Konka Electric Appliance Co., Ltd, which was used as pledge to open bank acceptance bills. In accordance with theAgreement on Opening BankAcceptance Bills (SN: CD79172015880178) signed by Konka Electric Appliance Co., Ltd and Shanghai Pudong Development Bank, Shenzhen Branch, a bank acceptance bill with an amount of RMB4,076,491.13 was opened, and its contractual term was from February 3, 2015 to July 28, 2015. In accordance with the Agreement on Opening Bank Acceptance Bills (2015 SJTZCS No. 068)signed by Konka ElectricAppliance Co., Ltd and China Minsheng Banking Corp., Ltd, Shenzhen Branch, a bank acceptance bill with an amount of RMB3,443,578.26 was opened, andits contractual term was from May 27,2015toNovember 27,2015.
XV. Events afterbalancesheet date
1. On 27 Aug. 2015, the Company held the 4th Meeting of the 8th Session of Board of Directors, the meeting reviewed and approved the 2015 profits distribution preplan, which was: in order to reward the shareholders and share the operation result with the shareholder and increase the liquidity of theCompany’s share, under the premise of ensuring the Company's normal operation and long-term development, the Company decided that: on the base of total equity of 1,203,972,704 shares, conducting capital reserve transfer into share capital, every 10 shares transfer 10 shares, after the transfer, the total share capital of the Company willincreaseby2,407,945,408 shares.
XVI. Other significantevents
1.Lease
(1) The closing original price accumulated depreciation and accumulated impairment provisionof all kindsof therented fixed assets.
Particulars of thefinancing lease of therented fixed assets, please refer to noteVI, 12,(3) (2)Minimumlease payment willbepaid infuture
Theremainingleaseterm Theminimumleasepayment Within1year(including1year) 796,757.13 Within1yearand2years(including2years) 276,328.20 Total 1,073,085.33 (3) The balance of unrecognized financing charges, and the method used to allocate the unrecognized financing charges.
As of the balance sheet date, the balance of unrecognized financing charges was RMB71, 200.00;amortization method istheactual interest ratemethod.
(4)Category offixedassets leased byoperating lease, please refer to noteVI, 12(4)
2. On 22 Apr. 2014, the Company signed Comprehensive Credit Contract No. CN11002022648-140416 with HSBC Bank (China) Co., Ltd. Shenzhen Sub-branch and gained loan of no more than$ 20 million, the period was 2 years after the withdrawal date. As of30Jun.2015,theCredit Limit had used$10,000,000.00，unused$10,000,000.00.
2015Semi-annualReportofKonkaGroupCo.,Ltd. 3. On 11 Jun. 2014, the Company signed Credit Contract No. J2014Z241JTB with CCB Shenzhen Sub-branch and gained general credit limit no more than RMB 5,000,000,000. Period of credit: 10 Jun. 2014 to 2016. 10 Jun.As of 30 Jun. 2015, the Credit Limit had usedRMB1,474,695,219.75，unused RMB 3,525,304,780.25.
4. On January 13, 2015, the Company signed a Comprehensive Credit Line Contract with the serial number of 0251378 with Bank of Beijing, Shenzhen Branch, according to which, max credit line was RMB500.00 million, and its term was from January 13, 2015 to January 13, 2016. Specific credit awarding businesses include loan in foreign currencies, acceptance of bills and opening of import letters of credit and letters of guarantee. By June 30, 2015, the used lineofthis credit linewas 427,765,138.15 andunused credit linewas 72,234,861.85. 5. On January 27, 2015, the Company signed a Comprehensive Credit Line Contract with the serial number of 2015 SJTZEZ No 002 with China Minsheng Banking Corp., Ltd, according to which, max credit line was RMB500.00 million. Specific credit awarding businesses include import and export deposit exchange, payment for import on behalf, delivery-taking guarantee and packing credit, as well as discounting(pledging) of bill of exchange that Party A conducts with Party B as a creditor and holder of bills. The validity term of the contract was from January 27,2015toJanuary 27,2016.
6. On March 31, 2015, the Company contracted with Agricultural Bank of China, Shenzhen OCT Sub-branch that max credit line to be applied was RMB2 billion. By June 30, 2015, the unused credit line was RMB1, 532, 264, 132.85 and used credit line was RMB467, 735, 867.15.
7. OnApril 23, 2015, the Company extended the term of the Credit LineAgreement with the serial number of 2013 ZZYEXZ No. 0001005 signed with Bank of China, Shenzhen Branch, according to which the Company and Konka Telecommunications provided a collateral guarantee against a bank acceptance bill no less than RMB1.3 billion for acquiring a comprehensive credit line of no more than RMB5.3 billion. The Company was the credited person and Konka Telecommunications was the entitled drawer, and expiration date after extension wasApril 21, 2016. By June 30, 2015, the used line of this credit line was RMB3, 928,819,716.69,and unused linewas RMB1, 371,180,283.31.
8. On May 28, 2015, the Company signed a Comprehensive Credit Line Contract with the serial number of 2015 SYQHZZ No.0005 with CITIC Bank, Shenzhen Civic Center Sub-branch, with a credit awarding line of RMB400 million. The specific credit awarding businesses included loan, undertaking and discounting of notes, opening of letter of credit, packing loan, import and export deposit exchange and opening of letter of guarantee. The credit awarding term of the contract was from May 28, 2015 to April 15, 2017. By June 30, 2015,thiscomprehensivecredit linehad not been used temporarily.
9. On May 13, 2015, the Company contracted with Bank of Ningbo, Shenzhen Branch that max credit line to be applied was RMB500 million. By June 30, 2015, unused line was RMB300 million andused linewas RMB200 million.
10. By June 30, 2015, the total amount for the letters of guarantee in RMB opened by the Company was RMB452, 634,000.00, the total amount for the letters of guarantee in USD was USD325, 000,000.00, and that for the letters of guarantee in EUR was EUR 25,000.00. of them, the amount for the letters of guarantee in RMB that the Company opened to Hong Kong Konka, its subsidiary, through its credit awarding bank was USD 325,200,000.00 and that for letters of guarantee the Company opened to Hong Kong Konka in USD was 226,000,000.00.
2015Semi-annualReportofKonkaGroupCo.,Ltd. 11.By June 30, 2015, the amount for the letters of credit that the Company opened for Konka Electronics, its subsidiary, was RMB3, 186,710,335.31; of which the amount used by the subsidiary was RMB3, 081,643,066.53, and unused amount was 105, 067, 268. 78. The total amount for theletters of credit that it opened for Hong Kong Konka, its subsidiary,was RMB 13, 619, 382.48; of which, the amount used by the subsidiary was RMB13, 619, 382.48, and unused amount was 0.
12. The dividend distribution program passed the review at the stockholder meeting of 2014 held on May 28, 2015, and its specific contents were as follows: Based on the total stock shares of 1,203,972,704 in the year of 2014, a dividend of RMB0.1 (tax included) will be distributed per 10 shares to all the stockholders, and total amount of dividend to be distributed will be RMB 12, 039,727.04, and remaining undistributed profit will be carried forward to lateryears for distribution.
13. The Company is planning equity incentive matter currently. By the date of approval of this report, the Company and related parties are preparing materials actively and doing their best to pushforward various jobs.
XVNotes ofmain items inthefinancial statements ofthe Company
1.Accounts receivable
(1)Accounts receivable
Closingbalance
|||||
|-|-|-|-|
|Bookbalance||Provisionforbaddebts||
|Amount|Proportion(%)|Amount|Proportion(%)|
|—|—|—|—|
|1,080,511,048.34|56.89|209,330,818.38|19.37|
|818,830,022.96|43.11|—|—|
|1,899,341,071.30|100.00|209,330,818.38|11.02|
|—|—|—|—|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
|||||
|-|-|-|-|
|1,899,341,071.3|100.00|209,330,818.38|100.00|

 (Continued)
Openingbalance
|||||
|-|-|-|-|
|Bookbalance||Provisionforbaddebts||
|Amount|Proportion(%)|Amount|Proportion(%)|
|—|—|—|—|
|1,436,462,593.91|81.90|214,731,732.08|14.95|
|317,565,114.46|18.10|—|—|
|1,754,027,708.37|100.00|214,731,732.08|12.24|
|—|—|—|—|
|1,754,027,708.37|100.00|214,731,732.08|12.24|

① In the groups, other accounts receivable adopting aging analysis method to withdraw bad debt provision:
Closingbalance
Aging
|||
|-|-|
|Accountreceivable|Provisionforbaddebts|
|844,192,506.30|16,884,260.69|
|24,347,792.28|1,217,389.61|
|21,519,804.47|4,303,960.89|
|4,064,337.37|2,032,168.69|

2015Semi-annualReportofKonkaGroupCo.,Ltd. Closingbalance
Aging
|||
|-|-|
|Accountreceivable|Provisionforbaddebts|
|2,987,138.84|1,493,569.42|
|183,399,469.08|183,399,469.08|
|1,080,511,048.34|209,330,818.38|

② In the groups, accounts receivable adopting other methods to withdraw bad debt provision:
Closingbalance
Nameofthegroup
|||
|-|-|
|Accountreceivable|Provisionforbaddebts|
|818,830,022.96|—|
|818,830,022.96|—|

 (2)Baddebt provision withdrawal, reversed orrecovered in thereport period
The amount of bad debt provision was RMB -5,400,913.70 the amount of reversed or recovered baddebt provision in thereport period RMBYuan
(3)Thetop five otheraccount receivable classified bydebtorat period end
The total amount of the top five account receivable classified by debtor at period end was RMB 334,682,253.94,17.62% of the balance of closing account receivable, the relevant balance ofbad debt provision was RMB9,542,592.79.
2.Otheraccount receivable
(1)Otheraccount receivableclassified by category
Closingbalance
|||||
|-|-|-|-|
|Bookbalance||Provisionforbaddebts||
|Amount|Proportion(%)|Amount|Proportion(%)|
|31,507,986.04|3.47|18,450,138.46|58.56|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
|||||
|-|-|-|-|
|138,637,718.41|15.24|31,050,122.36|22.40|
|739,368,129.13|81.29|—|—|
|878,005,847.54|96.53|31,050,122.36|3.54|
|—|—|—|—|
|909,513,833.58|100.00|49,500,260.82|5.44|

 (Continued)
Openingbalance
|||||
|-|-|-|-|
|Bookbalance||Provisionforbaddebts||
|Amount|Proportion(%)|Amount|Proportion(%)|
|31,507,969.28|3.07|18,797,943.19|59.66|
|629,814,580.00|61.30|20,473,350.81|3.25|
|366,148,374.77|35.63|—|—|
|995,962,954.77|96.93|20,473,350.81|2.06|
|—|—|—|—|
|1,027,470,924.05|100.00|39,271,294.00|3.82|

① Other accounts receivable with significant single amount and individually withdrawn bad
debt provisionat period-end
2015Semi-annualReportofKonkaGroupCo.,Ltd. Closingbalance
||||
|-|-|-|
|Otheraccountsreceivable|Provisionforbaddebts|Withdrawalproportion(%)|
|13,392,033.53|13,392,033.53|100.00|
|18,115,952.51|5,058,104.93|27.92|
|31,507,986.04|18,450,138.46||

②In thegroups, other accounts receivable adopting aging analysis method towithdraw bad debt provision:
Closingbalance
Aging
|||
|-|-|
|Otheraccountreceivable|Provisionforbaddebts|
|41,384,557.87|583,617.27|
|4,595,916.83|229,795.84|
|76,341,291.96|15,268,258.39|
|2,478,778.88|1,239,389.44|
|216,222.90|108,111.45|
|13,620,949.97|13,620,949.97|
|138,637,718.41|31,050,122.36|

③ In the groups, other accounts receivable adopting other methods to withdraw bad debt provision:
Closingbalance
Nameofthegroup
|||
|-|-|
|Otheraccountreceivable|Provisionforbaddebts|
|739,368,129.13|—|

(2)Baddebt provision withdrawal, reversed orrecovered in thereport period
The amount of bad debt provision was RMB 10,228,966.82 the amount of reversed or recovered baddebt provision in thereport period RMBYuan
(3)The top 5otheraccount receivable classified bydebtor at period end
|||||
|-|-|-|-|
|Nature|Closingbalance|Aging|Proportion%|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
|||||
|-|-|-|-|
|Nature|Closingbalance|Aging|Proportion%|
|Currentamount|112,829,249.88|Within1year|12.41|
|Currentamount|106,095,989.02|Within2-3years|11.67|
|Currentamount|100,000,000.00|Within1-2years|10.99|
|Subsidy|75,655,587.77|Within2-3years|8.32|
|Loan|62,894,650.00|Within1year|6.92|
||457,475,476.67||50.31|

2015Semi-annualReportofKonkaGroupCo.,Ltd. 3.Longtermequity investment
(1)Category ofequity investment
||||||
|-|-|-|-|-|
|Closingbalance|||||
|Bookbalance|Baddebtprovision|Bookvalue|Bookbalance|Baddebtprovision|
|1,632,810,835.91|94,394,984.69|1,538,415,851.22|1,505,310,835.91|94,394,984.69|
|202,286,296.11|—|202,286,296.11|197,758,604.87|—|
|1,835,097,132.02|94,394,984.69|1,740,702,147.33|1,703,069,440.78|94,394,984.69|

 (2)Investment tosubsidiaries oftheCompany
||||||
|-|-|-|-|-|
|Openingbalance|Increase|Decrease|Closingbalance|Withdrawnimpairmentprovisioninthereportingperiod|
|36,000,000.00|—|—|36,000,000.00|—|
|122,780,937.98|—|—|122,780,937.98|—|
|274,783,988.91|—|—|274,783,988.91|—|
|781,828.61|—|—|781,828.61|—|
|261,482.50|—|—|261,482.50|—|
|500,000.00|—|500,000.00|—|—|
|350,000,000.00|—|—|350,000,000.00|—|
|4,655,000.00|—|—|4,655,000.00|—|
|10,732,485.69|—|—|10,732,485.69|—|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
||||||
|-|-|-|-|-|
|Openingbalance|Increase|Decrease|Closingbalance|Withdrawnimpairmentprovisioninthereportingperiod|
|90,000,000.00|—|—|90,000,000.00|—|
|8,062,500.00|—|—|8,062,500.00|—|
|22,500,000.00|—|—|22,500,000.00|—|
|31,500,000.00|—|—|31,500,000.00|—|
|17,100,000.00|—|—|17,100,000.00|—|
|48,750,000.00|—|—|48,750,000.00|—|
|350,000,000.00|—|—|350,000,000.00|—|
|69,702,612.22|—|—|69,702,612.22|—|
|10,000,000.00|—|—|10,000,000.00|—|
|10,000,000.00|—|—|10,000,000.00|—|
|30,000,000.00|—|—|30,000,000.00|—|
|10,000,000.00|—|—|10,000,000.00|—|
|7,200,000.00|—|—|7,200,000.00|—|
|—|16,000,000.00|—|16,000,000.00|—|
|—|112,000,000.00|—|112,000,000.00|—|
|1,505,310,835.91|128,000,000.00|500,000.00|1,632,810,835.91|—|

2015Semi-annualReportofKonkaGroupCo.,Ltd. (3)Investment tojoint venture andassociated enterprise
||||||
|-|-|-|-|-|
|Openingbalance|||||
||Additionalinvestment|negativeinvestment|Profitsorlossesrecognizedunderequitymethod.|Adjustmentofothercomprehensiveincome|
|—|—|—|—|—|
|—|—|—|—|—|
|197,758,604.87|—|—|-1,798,656.54|—|
|—|6,210,000.00|—|116,347.78|—|
|197,758,604.87|6,210,000.00|—|-1,682,308.76|—|
|197,758,604.87|6,210,000.00|—|-1,682,308.76|—|

 (Continued)
|||||
|-|-|-|-|
|Increase/decrease|||Closingbalance|
|Equitiesorprofitsdeclaretoissue|Baddebtprovision|Other||
|—|—|—|—|
|—|—|—|—|

2015Semi-annualReportofKonkaGroupCo.,Ltd.
|||||
|-|-|-|-|
|Increase/decrease|||Closingbalance|
|Equitiesorprofitsdeclaretoissue|Baddebtprovision|Other||
|—|—|—|195,959,948.33|
|—|—|—|6,326,347.78|
|—|—|—|202,286,296.11|
|—|—|—|202,286,296.11|

2015Semi-annualReportofKonkaGroupCo.,Ltd. 4.RevenueandCost ofSales
(1)Revenue, Cost ofSales
||||
|-|-|-|
|Reportingperiod|||
|Revenues|Operatingcosts|Revenues|
|5,206,152,132.20|4,497,471,865.49|6,099,604,673.55|
|2,583,414,002.88|2,541,927,133.83|2,373,201,312.47|
|7,789,566,135.08|7,039,398,999.32|8,472,805,986.02|

 (2)Main business (Classified byindustry)
||||
|-|-|-|
|Reportingperiod|||
|Revenueofsales|Costsofsales|Revenueofsales|
|5,206,152,132.20|4,497,471,865.49|6,099,604,673.55|
|5,206,152,132.20|4,497,471,865.49|6,099,604,673.55|

 (3)Main business (Classified byproduct)
||||
|-|-|-|
|Reportingperiod|||
|Revenueofsales|Costsofsales|Revenueofsales|
|4,941,412,033.28|4,263,991,650.08|5,750,914,101.07|
|257,995,693.55|226,820,496.00|308,491,356.79|
|6,744,405.37|6,659,719.41|40,199,215.69|
|5,206,152,132.20|4,497,471,865.49|6,099,604,673.55|

 (4)Main business (Classified byarea)
||||
|-|-|-|
|Reportingperiod|||
|Revenueofsales|Costsofsales|Revenueofsales|
|4,482,238,335.25|3,820,646,881.53|5,136,480,346.53|
|723,913,796.95|676,824,983.96|963,124,327.02|
|5,206,152,132.20|4,497,471,865.49|6,099,604,673.55|

 (5)Therevenue ofsales from thetop five customers
Period TotalamountofTop5customers Proportionofthesameperiodofthe
operatingrevenue operatingrevenue(%)
2015Semi-annualReportofKonkaGroupCo.,Ltd.
||
|-|
|1,076,825,404.57|
|1,609,340,421.61|

5.Investmentincome
||
|-|
|2015|
|2,014,898.95|
|-1,682,308.76|
|-491,110.76|
|2,153,880.21|
|37,377,437.29|
|39,372,796.93|

2015Semi-annualReportofKonkaGroupCo.,Ltd. XVIII. Supplementary information
1.Listofnon-currentgains andlosses of2015
Item Amount Gain/lossonthedisposalofnon-currentassets(includingtheoffsetpartoftheassetimpairmentprovisions) -1,192,849.90 Tax rebates, reductions or exemptions due to approval beyond authority or the lack of official approval
— documents
Government grants recognized in the current period, except for those acquired in the ordinary course of
27,769,533.09businessorgrantedatcertainquotasoramountsaccordingtothegovernment’sunifiedstandards
Capitaloccupationchargesonnon-financialenterprisesthatarerecordedintocurrentgainsandlosses — Gains due to that the investment costs for the Company to obtain subsidiaries, associates and joint ventures
are lower than the enjoyable fair value of the identifiable net assets of the investees when making the — investments
Gain/lossonnon-monetaryassetswap — Gain/lossonentrustingotherswithinvestmentsorassetmanagement 3,442,481.04 AssetimpairmentprovisionsduetoactsofGodsuchasnaturaldisasters — Gain/lossondebtrestructuring — Expensesonbusinessreorganization,suchasexpensesonstaffarrangements,integration,etc. — Gain/lossonthepartoverthefairvalueduetotransactionswithdistinctlyunfairprices — Current net gains and losses of subsidiaries acquired in business combination under the same control from
— period-begintocombinationdate
Gain/lossoncontingenteventsirrelevanttotheCompany’snormalbusiness — Gainsandlossesonchangeinfairvaluefromtradablefinancialassetsandtradablefinancialliabilities,aswell
asinvestmentincomefromdisposaloftradablefinancialassetsandtradablefinancialliabilitiesandfinancial 2,153,880.21 assetsavailableforsalesexceptforeffectivehedgingrelatedwithnormalbusinessesoftheCompany
Impairmentprovisionreversalofaccountsreceivableonwhichtheimpairmenttestiscarriedoutseparately — Gain/lossonentrustmentloans 1,669,999.98 Gain/lossonchangeofthefairvalueofinvestingrealestateofwhichthesubsequentmeasurementiscarried
— outadoptingthefairvaluemethod
Effect on current gains/losses when a one-off adjustment is made to current gains/losses according to
— requirementsoftaxation,accountingandotherrelevantlawsandregulations
Custodyfeeincomewhenentrustedwithoperation — Non-operatingincomeandexpenseotherthantheabove 5,493,353.06 Othergainandlossitemsthatmeetthedefinitionofanextraordinarygain/loss 4,936,419.75 Subtotal
44,272,817.23 Less:Incometaxeffects 6,314,708.35
2015Semi-annualReportofKonkaGroupCo.,Ltd. Item Amount Minorityinterestseffects(aftertax) 973,384.29 Total 36,984,724.59 Notes: the number“+” among the non-current gains and losses items refers to profits and revenues, while “-”referred to losses orexpenditure.
The recognition of the non-current gains and losses items was executed according to the regulations of No.1 of the Information Disclosure Explanatory Notice of the Companies Public Offering Securities-Non-current Gains andlosses (Z-J-H-Announcement[2008]No. 43) .
||
|-|
|Involvedamount|
|34,130,823.15|
|34,130,823.15|

2.Net assets yieldandearnings pershare
|||
|-|-|
|ROEWA(%)||
||BasicEPS|
|-7.52|-0.2466|
|-8.46|-0.2774|

Notes: (1) The corresponding ROEWAof the net profits attributed the common shareholders of the Company =-317,914,497.85/(4,103,478,971.07-317,914,497.85/2-12,039,727.04*1/6+90,185.65*6/6-674,846.91*6/6)
The corresponding ROEWA of the net profits attributed the common shareholders after deducting the non-current gains and losses =(-317,914,497.85-36,716,371.02)/(4,103,478,971.07-317,914,497.85/2-12,039,727.04*1/6+90,185.
65*6/6-674,846.91*6/6)
2015Semi-annualReportofKonkaGroupCo.,Ltd. Section X. Documents Available for Reference
I. Financial statements with the signatures and seals of the company principal, the principal of accounting work andtheprincipal of theaccountingorgan (financial manager);
II. Originals ofAuditors’ Report with the seals of the CPAs firm and the signatures& seals of the certified publicaccountants;
III. Texts of all theCompany’s documents ever publicly disclosed in newspapers designated by CSRCin thereporting period, andthe originals ofthepublicnotices.
IV.Otherrelevant materials.
The Board of Directors
Konka Group Co.,Ltd.
28Aug. 2015