Weifu High-Technology Group Co., Ltd.
Semi-Annual Report 2018
August 2018
Section I. Important Notice, Contents and Paraphrase
Board of Directors, Supervisory Committee, all directors, supervisors and senior executives of Weifu High-Technology Group Co., Ltd. (hereinafter referred to as the Company) hereby confirm that there are no any fictitious statements, misleading statements, or important omissions carried in this report, and shall take all responsibilities, individual and/or joint, for the reality, accuracy and completion of the whole contents.
Chen Xuejun, Principal of the Company, Ou Jianbin, person in charger of accounting works and Ou Jianbin, person in charge of accounting organ (accounting principal) hereby confirm that the Financial Report of 2018 Semi-Annual Report is authentic, accurate and complete.
All directors are attended the Board Meeting for report deliberation.
In this report, details of relevant risks and countermeasures in operation have described, found more in relevant content in the Report. Concerning the forward-looking statements with future planning involved in the Report, they do not constitute a substantial commitment for investors. The China Securities Journal, Securities Times, Hong Kong Commercial Daily and Juchao Website（www.cninfo.com.cn）are the information disclosure media appointed by the Company, all information should be prevail on the above mentioned media, investors are advice to pay attention on investment risks.
The Company has no plan of cash dividend distributed, no cash bonus and capitalizing of common reserves either carried out.
Contents
Section I Important Notice, Contents and Paraphrase ................................................................. 2 Section II Company Profile and Main Finnaical Indexes ............................................................. 5 Section III Summary of Company Business .................................................................................. 8 Section IV Discussion and Analysis of Operation ........................................................................ 11 Section V Important Events .......................................................................................................... 18 Section VI Changes in shares and particular about shareholders ............................................... 27 Section VII PreferredStock……………………………………………………………………….31 Section VIII Particulars about Directors, Supervisors and SeniorExecutives…. ..................... 32 Section IX Corporate Bonds ........................................................................................................... 35 Section X Financial Report ............................................................................................................. 36 Section XI Documents Available for Reference ........................................................................... 160
Paraphrase
||||
|-|-|-|
|Items|Refers to|Contents|
|Company, The Company, Weifu High-technology|Refers to|Weifu High-Technology Group Co., Ltd.|
|Industry Group|Refers to|Wuxi Industry Development Group Co., Ltd.|
|Robert Bosch, Robert Bosch Company|Refers to|Robert Bosch Co., Ltd, ROBERT BOSCH GMBH|
|Bosch Automobile Diesel、Bosch Diesel System|Refers to|Bosch Automobile Diesel System Co., Ltd.|
|Weifu Leader|Refers to|Wuxi Weifu Leader Catalytic Converter Co., Ltd.|
|Weifu Jinning|Refers to|Nanjing Weifu Jinning Co., Ltd.|
|Weifu Tianli|Refers to|Ningbo Weifu Tianli Supercharging Technique Co., Ltd.|
|Weifu Environment|Refers to|Wuxi Weifu Environment Catalyst Co.,Ltd.|
|Weifu Precision Machinery|Refers to|Weifu Precision Machinery Manufacturing Co., Ltd.|
|Zhonglian Electronic|Refers to|Zhonglian Automobile Electronic Co., Ltd.|
|Protean|Refers to|Protean Holdings Corp.|
|CSRC|Refers to|China Securities Regulatory Commission|
|Reporting period|Refers to|1 January 2018 to 30 June 2018|

Section II Company Profile and Main Finnaical Indexes
I. Company information
|||||
|-|-|-|-|
|Short form of the stock|Weifu High- Tech, Su Weifu-B|Stock code|000581, 200581|
|Stock exchange for listing|Shenzhen Stock Exchange|||
|Chinese name of the Company|无锡威孚高科技集团股份有限公司|||
|Short form of the Company in Chinese (if||||
||威孚高科|||
|applicable)||||
|Foreign name of the Company (if applicable)|WEIFU HIGH-TECHNOLOGY GROUP CO.,LTD.|||
|Short form of foreign name of the Company (if||||
||WFHT|||
|applicable)||||
|Legal representative|Chen Xuejun|||

II. Person/Way to contact
||||
|-|-|-|
||Secretary of the Board|Rep. of security affairs|
|Name|Zhou Weixing|Yan Guohong|
|Contact add.|No.5, Huashan Road, New District, Wuxi City|No.5, Huashan Road, New District, Wuxi City|
|Tel.|0510-80505999|0510-80505999|
|Fax.|0510-80505199|0510-80505199|
|E-mail|web @ weifu.com.cn|web @ weifu.com.cn|

III. Others
1. Way of contact
Whether registrations address, offices address and codes as well as website and email of the Company changed in reporting period or not
□ Applicable√ Not applicable
Registrations address, offices address and codes as well as website and email of the Company has no change in reporting period, found more details in Annual Report 2017.
2. Information disclosure and preparation place
Whether information disclosure and preparation place changed in reporting period or not
□ Applicable√ Not applicable
The newspaper appointed for information disclosure, website for semi-annual report publish appointed by CSRC and preparation
place for semi-annual report have no change in reporting period, found more details in Annual Report 2017
IV. Main accounting data and financial indexes
Whether it has retroactive adjustment or re-statement on previous accounting data
□ Yes√ No
|||||
|-|-|-|-|
||Current period|Same period of last year|Changes over last year|
|Operating income (RMB)|4,960,801,890.99|4,728,125,599.02|4.92%|
|Net profit attributable to shareholders of|1,545,242,704.92|1,325,922,029.56||
||||16.54%|
|the listed company(RMB)||||
|Net profit attributable to shareholders of||||
|the listed company after deducting|1,378,865,501.57|1,208,264,288.81|14.12%|
|non-recurring gains and losses(RMB)||||
|Net cash flow arising from operating|378,923,690.48|352,401,241.52||
||||7.53%|
|activities(RMB)||||
|Basic earnings per share (RMB/Share)|1.53|1.31|16.79%|
|Diluted earnings per share (RMB/Share)|1.53|1.31|16.79%|
|Weighted average ROE|9.92%|9.84%|0.08%|
||Period-end|Period-end of last year|Changes over period-end of last year|
|Total assets (RMB)|21,920,788,842.86|20,231,006,224.36|8.35%|
|Net assets attributable to shareholder of|15,111,165,491.74|14,835,673,669.75||
||||1.86%|
|listed company (RMB)||||

V. Difference of the accounting data under accounting rules in and out of China
1. Difference of the net profit and net assets disclosed in financial report, under both IAS (International Accounting Standards) and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable√ Not applicable
The Company had no difference of the net profit or net assets disclosed in financial report, under either IAS (International Accounting Standards) or Chinese GAAP (Generally Accepted Accounting Principles) in the period.
2. Difference of the net profit and net assets disclosed in financial report, under both foreign accounting rules and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable√ Not applicable
The Company had no difference of the net profit or net assets disclosed in financial report, under either foreign accounting rules or Chinese GAAP (Generally Accepted Accounting Principles) in the period.
VI. Items and amounts of extraordinary profit (gains)/loss
√Applicable□ Not applicable
In RMB
||||
|-|-|-|
|Item|Amount|Note|
|Gains/losses from the disposal of non-current asset (including the write-off that accrued for|1,421,091.02||
|impairment of assets)|||
|Governmental subsidy reckoned into current gains/losses (not including the subsidy enjoyed in|17,700,030.17||
|quota or ration according to national standards, which are closely relevant to enterprise’s business)|||
|Profit and loss of assets delegation on others’ investment or management|159,801,630.73||
|Held transaction financial asset, gains/losses of changes of fair values from transaction financial|17,370,816.75||
|liabilities, and investment gains from disposal of transaction financial asset, transaction financial|||
|liabilities and financial asset available for sales, exclude the effective hedging business relevant|||
|with normal operations of the Company|||
|Switch back of provision for depreciation of account receivable which was singly taken|512,580.00||
|depreciation test|||
|Other non-operating income and expenditure except for the aforementioned items|73,701.23||
|Less: Impact on income tax|29,876,415.88||
|Impact on minority shareholders’ equity (post-tax)|626,230.67||
|Total|166,377,203.35|--|

 Concerning the extraordinary profit (gain)/loss defined byQ&A Announcement No.1 on Information Disclosure for Companies Offering Their Securities to the Public --- Extraordinary Profit/loss, and the items defined as recurring profit (gain)/loss according to the lists of extraordinary profit (gain)/loss inQ&A Announcement No.1 on Information Disclosure for Companies Offering Their Securities to the Public --- Extraordinary Profit/loss, explain reasons
□ Applicable√ Not applicable
In reporting period, the Company has no particular about items defined as recurring profit (gain)/loss according to the lists of extraordinary profit (gain)/loss inQ&A Announcement No.1 on Information Disclosure for Companies Offering Their Securities to the Public --- Extraordinary Profit/loss
Section III Summary of Company Business
I. Main businesses of the company in the reporting period
(i) Main business of the Company
1. The Company belongs to auto parts industry, and its main business products include diesel fuel injection system products, exhaust after-treatment system products and air management system products.
2. Main uses of the Company's products
(1) The diesel fuel injection system products are widely used in different power diesel engines supporting all types of trucks, passenger cars, buses, construction machinery, marine, and generator sets. The company not only makes products matching with the main engines used at home but also exports some products to the Americas, Southeast Asia, and the Middle East. The products meet the needs of national emission standards.
(2) The auto exhaust after-treatment system products: mainly support the major manufacturers of automobile, motorcycle and general machinery at home which meet the national emission standards.
(3) The intake system products (supercharger): matches with most of the domestic small-bore diesel engine plants and some six-cylinder diesel engine manufacturers, and meet the needs of the light and heavy commercial vehicles and some passenger cars, and meets the national emission standards.
3. Business model of the Company
The Company follows the operating philosophy of making competitive products, creating famous brands, striving for first choices, and creating value for the users, implements the business model that parent company unifies the management and subsidiaries decentralize the production. Namely, the group company is responsible for making strategic development planning and operation targets, and making the unified management, instruction and assessment for the finance, significant personnel management, core raw materials, quality control, and technology of the subsidiaries. The subsidiaries arrange production based on the order management model of market, which makes the subsidiaries keep the consistent quality with the company, helps keep abreast of customer needs and saving logistics costs, maintain the timeliness of products production and supply, and improve thecompany’s economic benefits.
During the reporting period, theCompany’s main business and business model have no significant changes. II. Major changes in main assets
1. Major changes in main assets
|||
|-|-|
|Major assets|Note of major changes|
|Equity assets|No major change|
|Fixed assets|No major change|
|Intangible assets|No major change|

|||
|-|-|
||Amount at end of the Period has major growth over that of year-beginning, mainly due to|
|Construction in progress||
||the increase of investment in equipment for technology reformation|

2. Main overseas assets
√Applicable□ Not applicable
||||||||||
|-|-|-|-|-|-|-|-|-|
||||||||The|Whether|
||||||Control||proportion|there are|
|Specific|||||||||
||||||measures to|Income|of overseas|significan|
|content of the|Cause of formation|Asset size|Locati|Operatio|||||
||||||guarantee asset|status|assets to the|t risks of|
|asset|||on|n model|||||
||||||security||company’s|impairme|
||||||||net assets|nt?|
||For the overall arrangement of||||||||
||the company’s future||||||||
||development, the 15th meeting||||||||
||of the eighth board of directors||||||||
||of the company reviewed and||||||||
||approved the Proposal on||||||||
||Foreign Investment. The||||||||
|The|company will invest 30 million||||||||
|||The Company|||||||
|Company|US dollars in the E-round||||The Company||||
|||invested|||||||
|paid|preferred stock issued by||||will pay full||||
|||US$24 million|||||||
|investment of|Protean and the two parties||||attention to||||
|||and obtained|||||||
|24 million|will establish a Sino-foreign||||changes in the||||
|||the stock right||Equity|||||
|US dollars on|joint venture in China.||the||industry and the||||
|||of subscribing||of|||||
|May 21, 2018|According to the investment||United||market, give|No|1.01%|No|
|||10,212,765||preferre|||||
|to become a|cooperation agreement, the||States||play to its own||||
|||shares of||d stock|||||
|shareholder|company paid the initial||||advantages, and||||
|||E-round|||||||
|of Protean|investment of 24 million US||||actively prevent||||
|||preferred|||||||
|E-round|dollars on May 21, 2018. The||||and resolve||||
|||stock issued|||||||
|preferred|company obtained the equity||||various risks.||||
|||by Protean.|||||||
|stock.|certificate of subscribing||||||||
||10,212,765 shares of E-round||||||||
||preferred stock issued by||||||||
||Protean and became a||||||||
||shareholder of the Protean||||||||
||E-round preferred stock with||||||||
||the equity certificate number of||||||||
||Number E-1.||||||||

III. Core Competitiveness Analysis
The Company is a high technology enterprise with a number of patented technologies. For years, rewarded as National Enterprise Technical Center, Post-doctor Scientific Research Station, Jiangsu Provincial Engineering and Technology Research Center, Industrialization Base of National Hi-Tech Research and Development Achievement, the Company has taken the research and development on the three major sections of Fuel Injection System, Automobile Exhaust After Treatment System and Air Intake System as the top priority, has actively worked on technology upgrading and innovation, made research and development on the forefront industries of new energy and new technology, taken active steps to make a layout for future business, all of which have made the Company take the leading position in industry with distinct technology advantages.
Core competitiveness of the Company has no major changes in the Period
Section IV Discussion and Analysis of Operation
I. Overview
Since the beginning of this year, the company has continued to seize market opportunities and follow the trend, continuously promoted the improvement of internal management, strengthened the internal risk control, improved the early warning mechanism, and achieved the steady growth of thecompany’s comprehensive economic benefits. During the period, the Company achived an operation revenue of 4.961 billion Yuan with a y-o-y growth of4.92%; profit amounted to 1.681 billion Yuan, an increase of14.94% from a year earlier; the net profit attributable to owners of parent company amounted as 1.545 billion Yuan, an increase of16.54% over same period of last year.
Main work in the first half of the year
1. Ensure the sustainable development of the traditional business market. Grasp the product market development, ensure related product projects to be approved by the main engine plants; focus on production delivery, the output of common rail products in the first half of the year reached a new high, and the supercharger products also had a good growth;
2. Accelerate the layout of new business and the implementation of projects. Plan and lay out new business, launch the cooperation project of hub motor business with Protean, the first delivery is 24 million US dollars, the joint venture project is progressing in an orderly manner.
3. Continue to promote the optimization and improvement of internal management. Sort out the management duty and function, optimize the organization; build a financial sharing center, plan and design the financial transformation; establish a group procurement sharing platform project to standardize, optimize and upgrade the existing system processes. Strengthen the security construction of thegroup’s information system and further improve the human resources management system.
II. Main business analysis
See the “I-Introduction” in “Discussion and Analysis of the Operation”
Change of main financial data on a y-o-y basis
In RMB
||||||
|-|-|-|-|-|
||||y-o-y||
|||Same period of last|||
||Current period||changes|Reasons|
|||year|||
||||(+,-)||
|Operation income|4,960,801,890.99|4,728,125,599.02|4.92%||
|Operation cost|3,889,590,289.69|3,736,290,938.86|4.10%||
||106,347,559.85|71,559,262.66||Increase of Three Packs of policy for|
|Sales expenses|||48.61%||
|||||sales and salary|

||||||
|-|-|-|-|-|
|Administrative expenses|413,983,378.78|399,568,734.73|3.61%||
||-1,776,908.37|1,688,051.32||1. Exchange loss has declined from a|
|||||year earlier for change of exchange|
|Financial cost|||-205.26%|rate; and 2. interest costs increased due|
|||||to the bank loans growth on a y-o-y|
|||||basis|
|Income tax expense|102,927,297.96|94,025,933.36|9.47%||
|R&D investment|177,443,968.15|140,532,863.22|26.27%||
|Net cash flow arising from|378,923,690.48|352,401,241.52|||
||||7.53%||
|operation activities|||||
|Net cash flow arising from|-592,455,421.53|-2,563,680,842.64|||
|investment activities|||||
|Net cash flow arising from|106,793,020.26|14,285,552.13||Net cash inflow from bank loans|
||||647.56%||
|financing activities||||increased|
|Net increase of cash and cash|-105,928,538.96|-2,200,012,859.87|||
|equivalent|||||

Major changes on profit composition or profit resources in reporting period
□ Applicable√ Not applicable
No major changes on profit composition or profit resources occurred in reporting period
Constitution of main business
In RMB
||||||||
|-|-|-|-|-|-|-|
|||||Increase or|Increase or|Increase or|
||||Gross|decrease of|decrease of|decrease of gross|
||Operating revenue|Operating cost|profit|operating revenue|operating cost|profit ratio over|
||||ratio|over same period|over same period|same period of|
|||||of last year|of last year|last year|
|According to industries|||||||
|Auto parts|4,725,759,054.05|3,682,028,566.53|22.09%|5.47%|4.42%|0.79%|
|According to products|||||||
|Auto fuel injection|||||||
||2,874,988,054.10|2,069,258,205.88|28.03%|-1.31%|-3.84%|1.90%|
|system|||||||
|Post-processing system|1,608,955,867.94|1,439,376,887.32|10.54%|16.22%|16.23%|-0.01%|
|Induction system|241,815,132.01|173,393,473.33|28.30%|31.89%|27.44%|2.51%|
|According to region|||||||
|Domestic|4,538,658,375.69|3,498,606,218.04|22.92%|4.99%|3.65%|1.00%|
|Overseas|187,100,678.36|183,422,348.49|1.97%|18.52%|21.60%|-2.48%|

 III. Analysis of non-main business
√Applicable□Not applicable
In RMB
||||||
|-|-|-|-|-|
|||Ratio in|||
||Amount||Note|Whether be sustainable|
|||total profit|||
|||||The Company’s joint ventures Bosch|
||||Income mainly from the two joint||
|||||Automobile Diesel and Zhonglian Electronics’|
|Investment|||ventures the Company (Bosch||
||1,149,033,168.39|68.36%||joint venture- Lianhe Electronic have stable|
|income|||Automobile Diesel and Zhonglian||
|||||production and operation both on a sustained|
||||Electronic)||
|||||basis|
|Asset|||||
||-10,087.38||||
|impairment|||||
|Non-operating|||||
||3,881,128.87|0.23%|||
|income|||||
|Non-operating|||||
||2,327,872.38|0.14%|||
|expense|||||

IV. Assets and liability
1. Major changes of assets composition
In RMB
||||||||
|-|-|-|-|-|-|-|
||Period-end||Period-end of last year||||
||||||Ratio||
|||Ratio in||Ratio in||Notes of major changes|
||Amount||Amount||changes||
|||total assets||total assets|||
||3,042,709,775.25|||||Net inflow from|
|||||||operation activity|
|Monetary fund||13.88%|1,846,838,076.57|9.79%|4.09%||
|||||||increased and bonus from|
|||||||joint venture|
|Account receivable|2,374,955,337.33|10.83%|2,028,796,617.26|10.75%|0.08%||
|Inventory|1,241,695,545.38|5.66%|1,134,167,227.47|6.01%|-0.35%||
|Investment property|22,761,528.91|0.10%|24,344,196.10|0.13%|-0.03%||
|Long-term equity|4,261,256,191.08||||||
|||19.44%|3,381,642,657.07|17.92%|1.52%||
|investment|||||||
|Fix assets|2,625,557,400.23|11.98%|2,443,323,924.72|12.95%|-0.97%||
||195,609,102.08|||||Investment of equipment|
|Construction in process||0.89%|137,789,424.89|0.73%|0.16%|for technology capacity|
|||||||expansion|
||359,000,000.00|||||Short-term loans from|
|Short-term loans||1.64%|185,000,000.00|0.98%|0.66%||
|||||||subsidiary increased|
|Long-term loans|45,000,000.00|0.21%|57,500,000.00|0.30%|-0.09%||

2. Assets and liability measured by fair value
√Applicable□Not applicable
In RMB
|||||||||
|-|-|-|-|-|-|-|-|
|||||Devaluatio|Amount|||
|||Changes of fair|Accumulative|||||
||Amount at the|||n of|of|||
|||value|changes of fair|||Amount of sale|Amount at|
|Items|beginning|||withdrawi|purchas|||
|||gains/losses in|value reckoned|||in the period|period-end|
||period|||ng in the|e in the|||
|||this period|into equity|||||
|||||period|period|||
|Financial assets||||||||
|3. Financial assets||||||||
||266,376,600.00|-59,786,808.00|28,866,874.66|||37,880,000.00|178,332,264.00|
|available for sale||||||||
|Subtotal of financial||||||||
||266,376,600.00|-59,786,808.00|28,866,874.66|||37,880,000.00|178,332,264.00|
|assets||||||||
|Above total|266,376,600.00|-59,786,808.00|28,866,874.66|||37,880,000.00|178,332,264.00|
|Financial liabilities|0.00||||||0.00|

 Whether there have major changes on measurement attributes for main assets of the Company in report period or not
□ Yes√No
3. The assets rights restricted till end of the period
||||
|-|-|-|
||Book value at||
|Item||Restriction reasons|
||period-end||
|Notes receivable|389,454,825.85|Notes pledge for bank acceptance|
|Monetary fund|99,317,091.42|Cash deposit for bank acceptance|
|Monetary fund|881,868.57|Court freeze|
|||In accordance with the civil ruling No.(2016)Y03MC2490 and No.(2016) Y03MC2492 of|
|||Guangdong Shenzhen Intermediate People's Court, the property with the value of 217 million|
|Financial assets||Yuan under the name of the Company and other seven respondents and the third party|
||166,608,867.78||
|available for sale||Shenzhen Hejun Chuangye Holdings Co., Ltd. was frozen. As of the end of the reporting|
|||period, 4.71 million shares of Miracle Logistics and 11,739,102 shares of SDEC held by the|
|||Company were frozen.|
|Total|656,262,653.62|--|

V. Investment
1. Overall situation
□ Applicable√ Not applicable
2. The major equity investment obtained in the reporting period
□ Applicable√ Not applicable
3. The major non-equity investment doing in the reporting period
□ Applicable√ Not applicable
4. Financial assets investment
(1) Securities investment
√Applicable□Not applicable
|||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
||||||Book|Changes||||||||
||||||||Cumulat|||Profit||||
|||||Account|value at|in fair|||||Book|||
||||||||ive fair|Current||and loss|||Capit|
|Variety||Short||ing|the|value of|||Current||value at|||
||Code of||Initial||||value|purchas||in the||Accountin|al|
|of|securitie|form of|investm|measure|beginni|the|||sales||the end|||
|securitie||securitie|||||changes|e||Reporti||g subject|Sourc|
|s|s|s|ent cost|ment|ng of|current|||amount||of the|||
||||||||in|amount||ng|||e|
|||||model|the|profit|||||period|||
||||||||equity|||Period||||
||||||period|and loss||||||||
|Domesti||||||||||||Financial||
|||||Measure||||||||||
|c and|||199,208||186,966|-36,754,|10,791,||37,880,|-36,754,|121,953|assets|Own|
||600841|SDEC||d by fair||||||||||
|foreign|||,000.00||,000.00|908.00|072.16||000.00|908.00|,564.00|available|funds|
|||||value||||||||||
|stocks||||||||||||for sales||
|Domesti||||||||||||Financial||
|||Miracle||Measure||||||||||
|c and|||69,331,||79,410,|-23,031,|18,075,|||-22,796,|56,378,|assets|Own|
||002009|Logistic||d by fair||||||||||
|foreign|||500.00||600.00|900.00|802.50|||400.00|700.00|available|funds|
|||s||value||||||||||
|stocks||||||||||||for sales||
||||268,539||266,376|-59,786,|28,866,||37,880,|-59,551,|178,332|||
|Total||||--||||0.00||||--|--|
||||,500.00||,600.00|808.00|874.66||000.00|308.00|,264.00|||
|Disclosure date of|||2012-03-24|||||||||||
|securities investment||||||||||||||
||||2013-06-04|||||||||||
|approval of the Board||||||||||||||
|Disclosure date of||||||||||||||
|securities investment||||||||||||||
|approval of the Shareholder||||||||||||||
|Meeting (if applicable)||||||||||||||

(2) Derivative investment
□ Applicable√ Not applicable
The Company has no derivatives investment in the Period
VI. Significant asset and equity sales
1. Significant asset sales
□ Applicable√ Not applicable
No significant assets being sold in the Period
2. Significant equity sales
□ Applicable√ Not applicable
VII. Analysis of the main stock-jointly and controlling subsidiary
√ Applicable□ Not applicable
Main subsidiary and stock-jointly enterprise with over10% influence on net profit of the Company
In RMB
||||||||||
|-|-|-|-|-|-|-|-|-|
|Comp|||||||||
|||Main|Register|||Operating|||
|any|Type|||Total assets|Net Assets||Operating profit|Net profit|
|||business|capital|||revenue|||
|name|||||||||
|||Post|||||||
|Weifu|Subsid|processing|502,596,3||||||
|||||3,537,070,508.71|1,631,298,114.97|1,589,176,188.66|82,487,470.88|76,364,083.43|
|Leader|iary|system|00.00||||||
|||products|||||||
|Weifu||Fuel|||||||
||Subsid||346,286,8||||||
|Jinnin||injection||1,176,068,481.85|835,263,636.19|345,257,893.56|73,059,055.58|70,230,711.18|
||iary||25.80||||||
|g||system|||||||
|Bosch|Joint-s||||||||
|||Fuel|||||||
|Autom|tock||USD241,0||||||
|||injection||12,124,233,285.95|7,229,298,166.49|8,713,485,959.51|2,410,025,921.13|2,076,330,091.90|
|obile|compa||00,000.00||||||
|||system|||||||
|Diesel|ny||||||||
|Zhong|Joint-s||||||||
|lian|tock|Gasoline|600,620,0||||||
|||||5,865,322,697.48|4,650,905,593.44|12,091,114.45|1,062,174,075.39|1,059,760,956.40|
|Electr|compa|system|00.00||||||
|onic|ny||||||||

Subsidiary obtained and disposed in the Period
□Applicable√Not applicable
VIII. The structured subject controlled by the Company
□ Applicable√ Not applicable
IX. Prediction of business performance from January– September 2018
Estimation on accumulative net profit from the beginning of the year to the end of next report period to be loss probably or the warning of its material change compared with the corresponding period of the last year and explanation on reason
□ Applicable√ Not applicable
X. Risks and countermeasures
(1) Macro economy and market risks
The Company belongs to the auto parts industry which is closely related to the macroeconomic situation and the automobile industry policies. At present, there are uncertainties in the world economy, if macro economy has substantial adjustments in the future, it will certainly have an impact on the growth rate of auto industry, and shows influence on operation production of the Company.
Countermeasures:
The Company will continue to strengthen the tracking research on macroeconomic situation and auto market dynamics, and strengthen the new technology reserves, accelerate the adjustment of product structure, strengthen the quality management, and improve the product market share based on policy guidance and market conditions; at the same time, proactively laying out new business, exploit new market and strive to enhance core competitiveness of the Company and overall anti-risk capability.
(2) The risks of operation management and control
With the rapid growth of the Company's assets and the continuous expansion of business scope, but there are still potential risks of operation management and control because of the large span and multiple links in personnel, business, finance, and capital management.
Countermeasures:
The Company will continue to promote the optimization and improvement of internal management, focus on strengthening the compliance management, further improve the system and processes, promote the institutionalization and standardization of Company management, and control the operational risks.
(3) The risks of fluctuations in raw material prices
The company's main raw materials include various grades of steel, aluminum, precious metals, etc., the continuous rise in prices will bring the risks of rising costs to the company.
Countermeasures: The company will pay close attention to the price trend of its main raw materials, and take the appropriate procurement opportunities for reasonable strategic reserves to resolve the risks of fluctuations in raw material prices.
Section V. Important Events
I. AGM and extraordinary general meeting
1. AGM held in the period
|||||||
|-|-|-|-|-|-|
|||Participation ratio||||
|Meeting|Type||Holding date|Disclosure date|Index|
|||for investors||||
|Annual General|||||Notice No.: 2018-021 released on|
||AGM|42.04%|2018-06-27|2018-06-28||
|Meeting of 2017|||||Juchao Website (www.cninfo.com.cn)|

 2. Request for extraordinary general meeting by preferred stockholders with rights to vote
□ Applicable√ Not applicable
II. Profit distribution plan and capitalizing of common reserves in the period
□ Applicable√ Not applicable
There are no cash dividend, bonus and capitalizing of common reserves carried out in the semi-annual
III. Commitments that actual controller, shareholder, related parties, buyer and committed party as the Company etc. have fulfilled during the reporting period and have not yet fulfilled by the end of reporting period
□ Applicable√ Not applicable
There are no commitments that the actual controller, shareholder, related parties, buyer and committed party as the Company etc. have fulfilled during the reporting period and have not yet fulfilled by the end of reporting period
IV. Appointment and non-reappointment (dismissal) of CPA
Whether the semi-annual financial report had been audited
□Yes√ No
The semi-annual report was not audited
V. Explanation on “Qualified Opinion” from CPA by the Board and Supervisory Committee
□ Applicable√ Not applicable
VI. Explanation from the Board for “Qualified Opinion” of lastyear’s
□ Applicable√ Not applicable
VII. Bankruptcy reorganization
□ Applicable√ Not applicable
No bankruptcy reorganization in Period.
VIII. Lawsuits
Material lawsuits and arbitration
□ Applicable√ Not applicable
No material lawsuits and arbitration in the reporting
Other lawsuits
√Applicable□ Not applicable
|||||||||
|-|-|-|-|-|-|-|-|
||Amount|||||||
|||Whether|||Judgment|||
||Related|||Trial Results||||
|||Formed|||Implementat|Disclosure|Disclosure|
|Basic Situation of|to the||Progress of Litigation|and Effects of||||
|||Accrued|||ion of|Date|Index|
|Litigation (Arbitration)|Case (10||(Arbitration)|Litigation||||
|||Liabilitie|||Litigation|||
||thousan|||(Arbitration)||||
|||s|||(Arbitration)|||
||d Yuan)|||||||
|On March 6, 2017, the|||By the Company’s application|||||
|company received the|||for reconsideration, Shenzhen|||||
|civil ruling|||Intermediate People's Court|||||
|No.(2016)Y03MC2490|||deemed the total assets that|||||
|and No.(2016)|||Cinda Company applied for|||||
|Y03MC2492 from|||preservation to be RMB|||||
|Shenzhen Intermediate|||217,027,697.23. The total|||||
|People's Court about the|||value of 15.3 million shares of|||||
|dispute case that the|||SDEC Stock and 4.71 million|||||
|plaintiff applicant China|||shares of Miracle Logistics|This litigation|||(Announceme|
|Cinda Asset|||held by the Company has|will not affect|||nt No.:|
|Management Co., Ltd.|||exceeded the total assets that|the company’s|Not yet|2017-03-0|2017-002)|
||21,703|N||||||
|Shenzhen Branch|||Cinda Company applied for|daily|implemente|8|published on|
|(hereinafter referred to|||preservation, therefore,|operating|d||www.cninfo.c|
|as “Cinda Company”)|||3,560,898 shares of SDEC|activities for|||om.cn|
|appealed the respondent|||Stock held by the Company|the time being||||
|Weifu High Technology|||was unfrozen. Up to the end|||||
|and other seven|||of the reporting period, the|||||
|respondents and the|||Company’s frozen assets were|||||
|shareholders of the third|||as follows: 4.71 million shares|||||
|party Hejun Company|||of Miracles Logistics held by|||||
|damaged the interests of|||the Company and its fruits,|||||
|corporate creditors,|||and 11,739,102 shares of|||||
|which adopted the|||SDEC Stock held by the|||||

|||||||||
|-|-|-|-|-|-|-|-|
|mandatory measures to|||company and its fruits. At|||||
|freeze the assets with|||present, this litigation is in the|||||
|value of RMB 217|||first instance (First trail on 24|||||
|million under the name|||September 2017 and|||||
|of the Company and|||follow-up session will held|||||
|other seven respondents|||until further notice)|||||
|and Hejun Company.||||||||
|Freeze 4.71 million||||||||
|shares of Miracle||||||||
|Logistics and 15.3||||||||
|million shares of SDEC||||||||
|Stock held by the||||||||
|company.||||||||
||||The Company has applied to|||||
||||the Futian Court for|||||
||||compulsory liquidation of|||||
||||Hejun Company. Futian Court|||||
||||has made a civil ruling|||||
|||||This event||||
|The Company applied to|||((2017) Yue 0304 QS No. 5)||||(Announceme|
|||||will not affect||||
|the Futian Court for|||which ruled to execute||Relevant||nt No.:|
|||||the||2017-12-0||
|compulsory liquidation|3,300|N|compulsory liquidation to||works still||2017-023)|
|||||Company’s||6||
|of Hejun Company.|||Hejun Company. The||in process||published on|
|||||daily||||
||||Company will actively||||www.cninfo.c|
|||||operating||||
||||cooperate with the court to do||||om.cn|
|||||activities||||
||||the relevant liquidation work|||||
||||and safeguard the legitimate|||||
||||rights and interests of the|||||
||||Company.|||||

IX. Penalty and rectification
□ Applicable√ Not applicable
No penalty and rectification for the Company in reporting period.
X. Integrity of the Company and its controlling shareholders and actual controllers
□ Applicable√ Not applicable
XI. Implementation of thecompany’s stock incentive plan, employee stock ownership plan or other employee incentives
□ Applicable√ Not applicable
The Company did not has implementation of theCompany’s stock incentive plan, employee stock ownership plan or other employee
incentive either
XII. Major related transaction
1. Related transaction with routine operation concerned
√ Applicable□ Not applicable
|||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
||||||||||Wheth|||||
|||||||||Trading|er over|||||
|||||||||||Cleari|Availab|||
|||||||Related||limit|the||||Index|
|||Type of|Conten||Relate|transaction|Proporti|||ng|le|Date of||
||||t of||d||on in|approved|approv|form|||of|
|Related|Relationship|related|related|Pricing|transac|amount|similar|||for|similar|disclos||
|party||transact||principle||(in 10||(in 10|ed||||disclos|
|||ion|transact||tion|thousand|transacti|||related|market|ure||
||||ion||price||ons (%)|thousand|limited|transa|||ure|
|||||||Yuan)||||ction|price|||
|||||||||Yuan)|or not|||||
||||||||||(Y/N)|||||
|||||Based||||||||2018-0|Notice|
|Weifu||||||||||Based||||
|||Procure||on fair||||||||4-17|No.:20|
|Precisio||||||||||on the||||
||Associated|ment of||value of|Market||||||Market||18-009|
|n|||Goods|||2,293.44|0.82%|5,000|N|contra||||
||company|goods||the|price||||||price|||
|Machin||||||||||ct||||
|||Goods||market||||||||||
|ery||||||||||terms||||
|||||price||||||||||
||Associated|||||||||||||
|||||Based||||||||||
||company,|||||||||Based||||
|||Procure||on fair||||||||||
|Bosch|Controlling|||||||||on the||||
|||ment of||value of|Market||||||Market|||
|Diesel|subsidiary of||Goods|||2,937.53|1.05%|7,000|N|contra||||
|||goods||the|price||||||price|||
|System|German|||||||||ct||||
|||Goods||market||||||||||
||Bosch|||||||||terms||||
|||||price||||||||||
||Company|||||||||||||
|||||Based||||||||||
|||||||||||Based||||
|||Procure||on fair||||||||||
|Weifu|Joint venture|||||||||on the||||
|||ment of||value of|Market||||||Market|||
|Environ|of Weifu||Goods|||94,628.31|33.70%|192,500|N|contra||||
|||goods||the|price||||||price|||
|ment|Leader|||||||||ct||||
|||Goods||market||||||||||
|||||||||||terms||||
|||||price||||||||||
|||||Based||||||||||
||Second|||||||||Based||||
|Robert||Procure||on fair||||||||||
||largest|||||||||on the||||
|Bosch||ment of||value of|Market||||||Market|||
||shareholder||Goods|||6,235.01|2.22%|14,300|N|contra||||
|Compa||goods||the|price||||||price|||
||of the|||||||||ct||||
|ny||Goods||market||||||||||
||Company|||||||||terms||||
|||||price||||||||||
|Weifu|Associated|Sales of|Goods|Based|Market|||||Based|Market|||
|||||||277.28|0.06%|300|N|||||
|Precisio|company|goods|and|on fair|price|||||on the|price|||

|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
|n|||labors|value of||||||contra||
|Machin||||the||||||ct||
|ery||||market||||||terms||
|||||price||||||||
||Associated|||||||||||
|||||Based||||||||
||company、|||||||||Based||
|||||on fair||||||||
|Bosch|Controlling||Goods|||||||on the||
|||Sales of||value of|Market||||||Market|
|Diesel|subsidiary of||and|||160,001.35|32.25%|300,000|N|contra||
|||goods||the|price||||||price|
|System|German||labors|||||||ct||
|||||market||||||||
||Bosch|||||||||terms||
|||||price||||||||
||Company|||||||||||
|||||Based||||||||
|||||||||||Based||
|||||on fair||||||||
|Weifu|Joint venture||Goods|||||||on the||
|||Sales of||value of|Market||||||Market|
|Environ|of Weifu||and|||2,874.18|0.58%|5,300|N|contra||
|||goods||the|price||||||price|
|ment|Leader||labors|||||||ct||
|||||market||||||||
|||||||||||terms||
|||||price||||||||
|||||Based||||||||
||Second|||||||||Based||
|Robert||||on fair||||||||
||largest|||||||||on the||
|Bosch||Sales of||value of|Market||||||Market|
||shareholder||Goods|||31,946.17|6.44%|77,220|N|contra||
|Compa||goods||the|price||||||price|
||of the|||||||||ct||
|ny||||market||||||||
||Company|||||||||terms||
|||||price||||||||
|||||Based||||||||
|||||||||||Based||
|||||on fair||||||||
|Weifu|Joint venture|Rent|Rent|||||||on the||
|||||value of|Market||||||Market|
|Environ|of Weifu|receiva|receiva|||125.4||255|N|contra||
|||||the|price||||||price|
|ment|Leader|ble|ble|||||||ct||
|||||market||||||||
|||||||||||terms||
|||||price||||||||
||Associated|||||||||||
|||||Based||||||||
||company,|||||||||Based||
|||Procure|Procure|on fair||||||||
|Bosch|Controlling|||||||||on the||
|||ment of|ment of|value of|Market||||||Market|
|Diesel|subsidiary of|||||4.27||5,000|N|contra||
|||fixed|fixed|the|price||||||price|
|System|German|||||||||ct||
|||assets|assets|market||||||||
||Bosch|||||||||terms||
|||||price||||||||
||Company|||||||||||
|||||Based||||||||
||Second|Technic|Technic|||||||Based||
|Robert||||on fair||||||||
||largest|al|al|||||||on the||
|Bosch||||value of|Market||||||Market|
||shareholder|service|service|||280.51||550|N|contra||
|Compa||||the|price||||||price|
||of the|fee|fee|||||||ct||
|ny||||market||||||||
||Company|payable|p ayable|||||||terms||
|||||price||||||||

|||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
|||Labor|Labor|||||||||||
||Associated|||||||||||||
|||service|service|Based||||||||||
||company,|||||||||Based||||
|||fee and|fee and|on fair||||||||||
|Bosch|Controlling|||||||||on the||||
|||technic|technic|value of|Market||||||Market|||
|Diesel|subsidiary of|||||||100|N|contra||||
|||al|al|the|price||||||price|||
|System|German|||||||||ct||||
|||service|service|market||||||||||
||Bosch|||||||||terms||||
|||fee|fee|price||||||||||
||Company|||||||||||||
|||payable|payable|||||||||||
|Total||||--|--|301,603.45|--|607,525|--|--|--|--|--|
|Detail of sales return with major amount||||Not applicable||||||||||
|involved||||||||||||||
|||||After deliberated and approved by AGM of 2017, it is estimated that the routine relatedtransaction for year of 2018 amounting to 6075.25 million Yuan, actually 3016.0345million Yuan in total occurred in reporting period, including:1. It is estimated that purchasing goods and labors from related parties amounted as 2188million Yuan at most for year of 2018, actually 1060.9429 million Yuan occurred inreporting period;2. It is estimated that sales of goods and labors to related parties amounted as 3828.2million Yuan at most for year of 2018, actually 1950.9898 million Yuan occurred inreporting period;3. It is estimated that other related transactions with related parties amounted as 59.05million Yuan at most for year of 2018, actually 4.1018 million Yuan occurred in reportingperiod;||||||||||
|Report the actual implementation of the||||||||||||||
|normal related transactions which were||||||||||||||
|projected about their total amount by||||||||||||||
|types during the reporting period(if||||||||||||||
|applicable)||||||||||||||
|Reasons for major differences between||||||||||||||
|trading price and market reference price||||Not applicable||||||||||
|(if applicable)||||||||||||||

2. Related transactions by assets acquisition and sold
□ Applicable√ Not applicable
No related transactions by assets acquisition and sold for the Company in reporting period
3. Main related transactions of mutual investment outside
□ Applicable√ Not applicable
No main related transactions of mutual investment outside for the Company in reporting period
4. Contact of related credit and debt
□ Applicable√ Not applicable
The Company had no contact of related credit and debt in the reporting period.
5. Other related transactions
□ Applicable√ Not applicable
The company had no other significant related transactions in reporting period.
XIII. Non-business capital occupying by controlling shareholders and its related parties
□ Applicable√ Not applicable
No non-business capital occupied by controlling shareholders and its related parties in Period
XIV. Significant contract and implementations
1. Trusteeship, contract and leasing
(1) Trusteeship
□ Applicable√ Not applicable
No trusteeship for the Company in reporting period
(2) Contract
□ Applicable√ Not applicable
No contract for the Company in reporting period
(3) Leasing
□ Applicable√ Not applicable
No leasing for the Company in reporting period
2. Major guarantees
√ Applicable□ Not applicable
(1) Guarantees
In 10 thousand Yuan
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
|Particulars about the external guarantee of the Company (Barring the guarantee for subsidiaries)|||||||||||
||||||Actual date of|||||Guarante|
|Name of the|Related|||||||||e for|
|||||Guarant|happening (Date|Actual||Guarantee|Implemen||
|Company|Announcement||||||Guarantee type|||related|
|||||ee limit|of signing|guarantee limit||term|ted (Y/N)||
|guaranteed|disclosure date|||||||||party|
||||||agreement)||||||
|||||||||||(Y/N)|
|Guarantee of the Company and the subsidiaries|||||||||||
|||Related||||||||Guarante|
||||||Actual date of||||||
|Name of the||Announce||||||||e for|
||||Guarantee||happening (Date|Actual||Guarantee|Implemen||
|Company||ment|||||Guarantee type|||related|
||||limit||of signing|guarantee limit||term|ted (Y/N)||
|guaranteed||disclosure||||||||party|
||||||agreement)||||||
|||date||||||||(Y/N)|
|Ningbo Tianli|||||||||||
|Turbo charging|||||||Joint liability||||
|||2016-10-27|6,000||2016-11-11|5,000||5|N|N|
|Technology Co.,|||||||guaranty||||
|Ltd.|||||||||||
|Total amount of approving||||||Total amount of actual occurred|||||
|guarantee for subsidiaries in|||0|||guarantee for subsidiaries in||5,000|||
|report period (B1)||||||report period (B2)|||||
|Total amount of approved||||||Total balance of actual guarantee|||||
||||6,000|||||5,000|||
|guarantee for subsidiaries at the||||||for subsidiaries at the end of|||||

||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
|end of reporting period (B3)||||reporting period (B4)|||||||
|Guarantee of the subsidiaries for the subsidiaries|||||||||||
||Related|||||||||Guarante|
||||Actual date of||||||||
|Name of the|Announce|||||||||e for|
|||Guarantee|happening (Date|Actual||Guarantee|Guarantee||Implemen||
|Company|ment|||||||||related|
|||limit|of signing|guarantee limit||type|term||ted (Y/N)||
|guaranteed|disclosure|||||||||party|
||||agreement)||||||||
||date|||||||||(Y/N)|
|Total amount of guarantee of the Company( total of three abovementioned guarantee)|||||||||||
|Total amount of approving||||Total amount of actual occurred|||||||
|guarantee in report period||0||guarantee in report period||||5,000|||
|(A1+B1+C1)||||(A2+B2+C2)|||||||
|Total amount of approved||||Total balance of actual guarantee|||||||
|guarantee at the end of report||6,000||at the end of report period||||5,000|||
|period (A3+B3+C3)||||(A4+B4+C4)|||||||
|The proportion of the total amount of actually guarantee in the|||||||||||
|||||0.33%|||||||
|net assets of the Company (that is A4+ B4+C4)|||||||||||
|Including:|||||||||||
|Amount of guarantee for shareholders, actual controller and its|||||0||||||
|related parties(D)|||||||||||
|The debts guarantee amount provided for the guaranteed parties|||||0||||||
|whose assets-liability ratio exceed 70% directly or indirectly(E)|||||||||||
|Proportion of total amount of guarantee in net assets of the|||||0||||||
|Company exceed 50%(F)|||||||||||
|Total amount of the aforesaid three guarantees(D+E+F)|||||0||||||
|Explanations on possibly bearing joint and several liquidating|||||Not applicable||||||
|responsibilities for undue guarantees (if applicable)|||||||||||
|Explanations on external guarantee against regulated procedures|||||Not applicable||||||
|(if applicable)|||||||||||

Explanation on guarantee with composite way: Nil
(2)Guarantee outside against the regulation
□ Applicable√ Not applicable
No guarantee outside against the regulation in Period.
3. Other material contracts
□ Applicable√ Not applicable
No other material contracts for the Company in reporting period
XV. Social responsibility
1.Major environmental issues
The company and its subsidiariesdon’t belong to the key pollutant discharging units published by the environmental protection department.
Protecting the environment is the corporate mission of Weifu High Technology. Thecompany’s main business is expanded around the energy saving and emission reduction of automobiles. At present, thecompany’s main products have all met the emission regulations required by the state, and the company is actively preparing products that can meet the requirements of more stringent emission regulations. Saving resources and reducing consumption are part of the core value of Weifu High Technology. On the one hand, it is conducive to the improvement of enterprise efficiency, and at the same time, it is conducive to improving the resource utilization rate of the whole society. Therefore, the company will continue to improve the resource utilization through technological innovation.
The company resolutely implements the “three simultaneous” system of construction projects and strictly performs the procedures for environmental impact assessment, approval, and acceptance of construction projects. In the process of new project and technical transformation, the new and old pollution can be solved together according to the principle of technical feasibility and economic rationality, and the “three wastes” management project must be designed, constructed and accepted at the same time as the main project.
2. Precise poverty alleviation social responsibility
There are no precise poverty alleviation carried out in the period and no follow plan either
XVI. Explanation on other significant events
□Applicable√Not applicable
There are no explanations on other significant events in the period
XVII. Significant event of subsidiary of the Company
√ Applicable□ Not applicable
Proposed application for listing in the national middle and small enterprises stock transfer system by the controlling subsidiary Weifu Tianli
On 25 October 2016, the
8th
board of directors of the Company held the
9th
meeting to consider and approve the proposal relating to proposed application for listing in the national middle and small enterprises stock transfer system by the controlling subsidiary Ningbo Weifu Tianli Supercharging Technique Co., Ltd. on 30 December 2016, Weifu Tianli was served with the notice of acceptance from the National Middle and Small Enterprise Stock Transfer System Company Limited (GP2016120120). The relevant announcements (No.: 2016-020, 2016-023 and 2017-001) were published on China Securities Journal, Securities Times, Hong Kong Commercial Daily and Juchao Information Website (http://www.cninfo.com.cn). At the current stage, this matter is in the progress of consideration and approval.
Section VI. Changes in Shares and Particulars about Shareholders I. Changes in Shares
1. Changes in Shares
In Share
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
||Before the Change||Increase/Decrease in the Change (+, -)|||||After the Change||
||||||Capitaliza|||||
||||New|||||||
|||Proporti||Bonus|tion of||Subtot|||
||Amount||shares|||Others||Amount|Proportion|
|||on|issued|shares|public||al|||
||||||reserve|||||
|I. Restricted shares|78,577|0.01%||||2,002|2,002|80,579|0.01%|
|1. State Shareholdings|0|||||||||
|2. State-owned corporate||||||||||
||0|||||||||
|shares||||||||||
|3. Other domestic shares|78,577|0.01%||||2,002|2,002|80,579|0.01%|
|Including: domestic corporate||||||||||
||0|||||||||
|shares||||||||||
|Domestic nature person||||||||||
||78,577|0.01%||||2,002|2,002|80,579|0.01%|
|shares||||||||||
|4. Foreign shares|0|||||||||
|II. Unrestricted shares|1,008,871,993|99.99%||||-2,002|-2,002|1,008,869,991|99.99%|
|1. RMB Ordinary shares|836,491,993|82.90%||||-2,002|-2,002|836,489,991|82.90%|
|2. Domestically listed foreign||||||||||
||172,380,000|17.09%||||||172,380,000|17.09%|
|shares||||||||||
|III. Total shares|1,008,950,570|100.00%||||||1,008,950,570|100.00%|

 Reasons for share changed
□Applicable√ Not applicable
Approval of share changed
□Applicable√ Not applicable
Ownership transfer of share changed
□Applicable√Not applicable
Influence on the basic EPS and diluted EPS as well as other financial indexes of net assets per share attributable to common shareholders of Company in latest year and period
□Applicable√Not applicable
Other information necessary to disclose for the Company or need to disclosed under requirement from security regulators
□Applicable√Not applicable
2. Changes of restricted shares
√Applicable□Not applicable
In Share
||||||||
|-|-|-|-|-|-|-|
||Shares|Shares|Shares|Shares|||
|Sharehol||||||Date for|
||restricted at|un-lock in|increased for|restricted at|Reasons||
|der||||||un-lock|
||period-begin|the period|restriction|period-end|||
|Zhang|||||Executive lock-shares (resigned from supervisor for||
||0|0|500|500||2018-12-27|
|Zhenting|||||general election of supervisory committee)||
|Dai|||||Executive lock-shares (elected as supervisor for||
||0|0|1,500|1,500||Not applicable|
|Lizhong|||||general election of supervisory committee)||
|Total|0|0|2,000|2,000|--|--|

 II. Securities issuance and listing
□ Applicable√ Not applicable
III. Amount of shareholders of the Company and particulars about shares holding
In share
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
|Total common shareholders at|||Total preference shareholders with voting rights recovered at endof reporting period (if applicable) (see note 8)|||||||
||64,429|||||||0||
|period-end||||||||||
|Particulars about shares held above 5% by common shareholders or top ten common shareholders||||||||||
|||||||||Number of||
|||||||||share||
|||||Total common||Amount of|Amount of|||
||||||Changes|||pledged/froze||
|||Proportion||shareholders||restrict|un-restrict|||
|Full name of Shareholders|Nature of|of shares|||in report|||n||
||shareholder|||at the end of||common|common|||
|||held|||period|||State||
|||||report period||shares held|shares held||Amo|
|||||||||of||
||||||||||unt|
|||||||||share||
|Wuxi Industry DevelopmentGroup Co., Ltd|State-ownedcorporate|20.22%||204,059,398|0||204,059,398|||
|ROBERT BOSCH GMBH|Foreigncorporate|14.16%||142,841,400|0||142,841,400|||
|BBH BOS S/A FIDELITY FD- CHINA FOCUS FD|Foreigncorporate|1.71%||17,286,585|2,527,091||17,286,585|||
|Bank of Communication –HSBC Jixin Double CoreStrategy Mixed SecuritiesInvestment Fund|Other|1.67%||16,805,835|16,805,835||16,805,835|||
|Hong Kong Securities|Foreign|1.61%||16,284,346|-3,213,996||16,284,346|||

||||||||||
|-|-|-|-|-|-|-|-|-|
|Clearing Company Ltd.(HKSCC)|corporate||||||||
|Central Huijin AssetsManagement Co., Ltd.|State-ownedcorporate|1.27%|12,811,200||0||12,811,200||
|RBC EMERGINGMARKETS EQUITY FUND|Foreigncorporate|0.66%|6,667,035||-1,371,300||6,667,035||
|FIDELITY INVMT TRTFIDELITY INTL SMALLCAP FUND|Foreigncorporate|0.54%|5,459,404||1,046,572||5,459,404||
|National Social SecurityFund-412|Other|0.45%|4,499,184||531,857||4,499,184||
|Ping An Life InsuranceCompany of China – Bonus–individual insurance|Other|0.40%|4,009,378||-203,600||4,009,378||
|Strategy investors or general corporation|||||||||
|comes top 10 shareholders due to rights issue||Not applicable|||||||
|(if applicable) (see note 3)|||||||||
|||Among the top ten shareholders, there has no associated relationship between Wuxi|||||||
|||Industry Development Croup Co., Ltd. and other shareholders, the first largest|||||||
|Explanation on associated relationship among|||||||||
|||shareholder of the Company; and they do not belong to the consistent actionist|||||||
|the aforesaid shareholders|||||||||
|||regulated by the Management Measure of Information Disclosure on Change of|||||||
|||Shareholding for Listed Company.|||||||
|Particular about top ten shareholders with un-restrict common shares held|||||||||
|||||Amount of un-restrict||Type of shares|||
|Shareholders’ name||||common shares held|||||
|||||||Type||Amount|
|||||at Period-end|||||
|Wuxi Industry Development Group Co., Ltd||||204,059,398||RMB common shares||204,059,398|
|ROBERT BOSCH GMBH||||142,841,400||RMB common shares||115,260,600|
|||||||Domestically listed foreign|||
|||||||||27,580,800|
|||||||shares|||
|BBH BOS S/A FIDELITY FD - CHINA FOCUS FD||||17,286,585||Domestically listed foreign|||
|||||||||17,286,585|
|||||||shares|||
|Bank of Communication – HSBC Jixin Double Core StrategyMixed Securities Investment Fund||||16,805,835|||||
|||||||RMB common shares||16,805,835|
|Hong Kong Securities Clearing Company Ltd. (HKSCC)||||16,284,346||RMB common shares||16,284,346|
|Central Huijin Assets Management Co., Ltd.||||12,811,200||RMB common shares||12,811,200|
|RBC EMERGING MARKETS EQUITY FUND||||6,667,035||Foreign listed foreign shares||6,667,035|
|FIDELITY INVMT TRT FIDELITY INTL SMALL CAPFUND||||5,459,404|||||
|||||||Foreign listed foreign shares||5,459,404|

|||||
|-|-|-|-|
|National Social Security Fund-412|4,499,184|RMB common shares|4,499,184|
|Ping An Life Insurance Company of China – Bonus –individualinsurance|4,009,378|||
|||RMB common shares|4,009,378|
||Among the top ten shareholders, there has no associated|||
|Expiation on associated relationship or consistent actors within|relationship between Wuxi Industry Development Croup Co., Ltd.|||
|the top 10 un-restrict common shareholders and between top 10|and other shareholders, the first largest shareholder of the|||
|un-restrict common shareholders and top 10 common|Company; and they do not belong to the consistent actionist|||
|shareholders|regulated by the Management Measure of Information Disclosure|||
||on Change of Shareholding for Listed Company.|||
|Explanation on top 10 shareholders involving margin business||||
||Not applicable|||
|(if applicable) (see note 4)||||

Whether top ten common shareholders or top ten common shareholders with un-restrict shares held have a buy-back agreement dealing in reporting period
□ Yes√ No
The top ten common shareholders or top ten common shareholders with un-restrict shares held of the Company have no buy-back agreement dealing in reporting period.
IV. Changes of controlling shareholders or actual controller
Changes of controlling shareholders in reporting period
□ Applicable√ Not applicable
Changes of controlling shareholders had no change in reporting period.
Changes of actual controller in reporting period
□ Applicable√ Not applicable
Changes of actual controller in reporting period had no change in reporting period.
Section VII. Preferred Stock
□ Applicable√ Not applicable
The Company had no preferred stock in the reporting.
Section VIII. Directors, Supervisors and Senior Executives
I. Changes of shares held by directors, supervisors and senior executives
√Applicable□ Not applicable
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
|||||Amount of|Amount of||Number of|Number of|Number of|
||||Shares|||||||
|||||shares|shares|Shares|restricted|restricted|restricted|
||||held at|||||||
|||W o r k in g||increased|decreased|held at|shares|shares|shares|
||Title||period-|||||||
|Name||status||in this|in this|period-end|delegated at|delegated in|delegated at|
||||begin|||||||
|||||period|period|(Share)|period-begin|the period|period-end|
||||(Share)|||||||
|||||(Share)|(Share)||(Share)|(Share)|(Share)|
|Chen||Currently in||||||||
||President||34,753|||34,753||||
|Xuejun||office||||||||
|Rudolf|Deputy|Currently in||||||||
|Maier|president|office||||||||
||Deputy|||||||||
|Wang||Currently in||||||||
||president,||20,781|||20,781||||
|Xiaodong||office||||||||
||GM|||||||||
||Director,|||||||||
|Ou|standing|Currently in||||||||
||||10,000|||10,000||||
|Jianbin|deputy GM|office||||||||
||and CFO|||||||||
|Zhang||Currently in||||||||
||Director|||||||||
|Xiaogeng||office||||||||
|Chen||Currently in||||||||
||Director|||||||||
|Yudong||office||||||||
|Hua||Currently in||||||||
||Director|||||||||
|Wanrong||office||||||||
|Yu|Independent|Currently in||||||||
|Xiaoliyu|director|office||||||||
|Lou|Independent|Currently in||||||||
|Diming|director|office||||||||
|Jin|Independent|Currently in||||||||
|Zhangluo|director|office||||||||
|Xu|Independent|Currently in||||||||
|Xiaofang|director|office||||||||
||Chairman of|||||||||
|Shi||Currently in||||||||
||supervisory||12,673|||12,673||||
|Xingyuan||office||||||||
||committee|||||||||

|||||||||||
|-|-|-|-|-|-|-|-|-|-|
|Ma||Currently in||||||||
||Supervisor|||||||||
|Yuzhou||office||||||||
|Dai||Currently in||||||||
||Supervisor|||2,000||2,000||||
|Lizhong||office||||||||
|Miao||Currently in||||||||
||Deputy GM||10,000|||10,000||||
|Yuming||office||||||||
|Xu||Currently in||||||||
||Deputy GM||13,000|||13,000||||
|Yunfeng||office||||||||
|Zhou|Secretary of|Currently in||||||||
||||3,565|||3,565||||
|Weixing|the Board|office||||||||
||Independent|Leave the||||||||
|Xing Min||||||||||
||director|post||||||||
|Zhang||Leave the||||||||
||Supervisor||500|||500||||
|Zhenting||post||||||||
|||Leave the||||||||
|Liu Jinjun|Supervisor|||||||||
|||post||||||||
|Total|--|--|105,272|2,000|0|107,272|0|0|0|

 II. Resignation and dismissal of directors, supervisors and senior executives
√Applicable□Not applicable
||||||
|-|-|-|-|-|
|Name|Position|Type|Date|Reasons|
|Chen Xuejun|President|Election|2018-06-27|General election of the Board|
|Rudolf Maier|Deputy President|Election|2018-06-27|General election of the Board|
|Wang Xiaodong|Deputy President, GM|Election|2018-06-27|General election of the Board|
||Director, standing||||
|Ou Jianbin||Election|2018-06-27|General election of the Board|
||deputy GM and CFO||||
|Zhang Xiaogeng|Director|Election|2018-06-27|General election of the Board|
|Chen Yudong|Director|Election|2018-06-27|General election of the Board|
|Hua Wanrong|Director|Election|2018-06-27|General election of the Board|
|Yu Xiaoli|Independent director|Election|2018-06-27|General election of the Board|
|Lou Diming|Independent director|Election|2018-06-27|General election of the Board|
|Jin Zhangluo|Independent director|Election|2018-06-27|General election of the Board|
|Yu Xiaofang|Independent director|Election|2018-06-27|General election of the Board|
||Chairman of||||
|Shi Xingyuan||Election|2018-06-27|General election of supervisory committee|
||supervisory committee||||

||||||
|-|-|-|-|-|
|Ma Yuzhou|Supervisor|Election|2018-06-27|General election of supervisory committee|
|Dai Lizhong|Supervisor|Election|2018-06-27|General election of supervisory committee|
|Miao Yuming|Deputy GM|Appointment|2018-06-27|General election of the Board|
|Xu Yunfeng|Deputy GM|Appointment|2018-06-27|General election of the Board|
|Zhou Weixing|Secretary of the Board|Appointment|2018-06-27|General election of the Board|
|||Leave the post|||
|||||Resigned the post for general election of the|
|Xing Min|Independent director|for office term|2018-06-27||
|||||Board|
|||expired|||
|||Leave the post|||
|||||Resigned the post for general election of|
|Zhang Zhenting|Supervisor|for office term|2018-06-27||
|||||supervisory committee|
|||expired|||
|||Leave the post|||
|||||Resigned the post for general election of|
|Liu Jinjun|Supervisor|for office term|2018-06-27||
|||||supervisory committee|
|||expired|||

Section IX Corporate Bond
Whether the Company has a corporation bonds that issuance publicly and listed on stock exchange and without due on the date when semi-annual report approved for released or fail to cash in full on due
No
Section X. Financial Report
I. Audit report
Whether the semi annual report is audited
□ Yes√ No
The company's semi annual financial report has not been audited.
II. Financial statement
Unit in note of financial statement refers to CNY: RMB (Yuan)
1. Consolidated balance sheet
Prepared by Weifu High-Technology Group Co., Ltd
2018-6-30
In RMB
||||
|-|-|-|
|Item|Ending balance|Opening balance|
|Current assets:|||
|Monetary funds|3,042,709,775.25|3,118,709,412.83|
|Settlement provisions|||
|Capital lent|||
|Financial assets measured by fair value and with variation|||
|reckoned into current gains/losses|||
|Derivative financial assets|||
|Notes receivable|1,676,937,153.03|1,464,256,934.83|
|Accounts receivable|2,374,955,337.33|1,995,577,830.90|
|Account paid in advance|99,860,122.30|97,576,197.88|
|Insurance receivable|||
|Reinsurance receivables|||
|Contract reserve of reinsurance receivable|||
|Interest receivable|1,480,250.00|2,281,979.17|
|Dividends receivable|546,269,615.74||
|Other receivables|17,839,885.07|5,214,623.41|
|Purchase restituted finance asset|||
|Inventories|1,241,695,545.38|1,478,939,040.70|

||||
|-|-|-|
|Divided into assets held for sale|||
|Non-current assets due within one year|||
|Other current assets|4,586,279,800.73|3,887,997,290.53|
|Total current assets|13,588,027,484.83|12,050,553,310.25|
|Non-current assets:|||
|Loans and payments on behalf|||
|Available-for-sale financial assets|479,236,360.00|588,142,869.00|
|Held-to-maturity investments|||
|Long-term receivables|||
|Long-term equity investments|4,261,256,191.08|4,140,064,825.58|
|Investment property|22,761,528.91|23,544,830.78|
|Fixed assets|2,625,557,400.23|2,584,872,628.54|
|Construction in progress|195,609,102.08|100,345,461.28|
|Project materials|||
|Disposal of fixed assets|||
|Productive biological assets|||
|Oil and natural gas assets|||
|Intangible assets|332,886,731.99|340,632,143.36|
|Research and development costs|||
|Goodwill|1,784,086.79|1,784,086.79|
|Long-term deferred expenses|7,951,490.73|2,969,770.81|
|Deferred income tax assets|202,373,683.03|203,007,622.23|
|Other non-current assets|203,344,783.19|195,088,675.74|
|Total non-current assets|8,332,761,358.03|8,180,452,914.11|
|Total assets|21,920,788,842.86|20,231,006,224.36|
|Current liabilities:|||
|Short-term borrowings|359,000,000.00|243,000,000.00|
|Loan from central bank|||
|Absorbing deposit and interbank deposit|||
|Capital borrowed|||
|Financial liability measured by fair value and with variation|||
|reckoned into current gains/losses|||
|Derivative financial liability|||
|Notes payable|1,086,240,637.65|947,976,759.10|

||||
|-|-|-|
|Accounts payable|2,596,968,053.96|2,570,956,205.83|
|Accounts received in advance|38,744,126.90|42,820,236.07|
|Selling financial asset of repurchase|||
|Commission charge and commission payable|||
|Wage payable|272,784,575.15|327,778,677.29|
|Taxes payable|94,439,018.34|93,869,690.36|
|Interest payable|555,009.72|401,928.43|
|Dividend payable|1,210,740,700.00||
|Other accounts payable|65,356,662.87|62,937,940.90|
|Reinsurance payables|||
|Insurance contract reserve|||
|Security trading of agency|||
|Security sales of agency|||
|Liability held for sale|||
|Non-current liabilities due within one year|5,000,000.00|10,000,000.00|
|Other current liabilities|||
|Total current liabilities|5,729,828,784.59|4,299,741,437.98|
|Non-current liabilities:|||
|Long-term loans|45,000,000.00|45,000,000.00|
|Bonds payable|||
|Including: preferred stock|||
|Perpetual capital securities|||
|Long-term account payable|19,407,272.00|17,496,363.00|
|Long-term wages payable|30,448,132.88|30,448,132.88|
|Special accounts payable|18,265,082.11|18,265,082.11|
|Accrual liabilities|||
|Deferred income|439,544,262.06|451,281,721.77|
|Deferred income tax liabilities|7,062,415.26|17,406,622.39|
|Other non-current liabilities|||
|Total non-current liabilities|559,727,164.31|579,897,922.15|
|Total liabilities|6,289,555,948.90|4,879,639,360.13|
|Owners’ equity:|||
|Share capital|1,008,950,570.00|1,008,950,570.00|
|Other equity instrument|||

||||
|-|-|-|
|Including: preferred stock|||
|Perpetual capital securities|||
|Capital reserve|3,416,016,805.42|3,417,841,402.89|
|Less: Inventory shares|||
|Other comprehensive income|28,866,874.66|87,169,455.01|
|Reasonable reserve|1,119,601.82|2,606.93|
|Surplus reserve|510,100,496.00|510,100,496.00|
|Provision of general risk|||
|Retained profit|10,146,111,143.84|9,811,609,138.92|
|Total owners’ equity attributable to parent company|15,111,165,491.74|14,835,673,669.75|
|Minority interests|520,067,402.22|515,693,194.48|
|Total owners’ equity|15,631,232,893.96|15,351,366,864.23|
|Total liabilities and owner’s equity|21,920,788,842.86|20,231,006,224.36|

 Legal Representative: Chen Xuejun
Person in charge of accounting works: Ou Jianbin
Person in charge of accounting institute: Ou Jianbin
2. Balance Sheet of Parent Company
In RMB
||||
|-|-|-|
|Item|Ending balance|Opening balance|
|Current assets:|||
|Monetary funds|2,603,443,354.29|2,460,413,190.84|
|Financial assets measured by fair value and with variation|||
|reckoned into current gains/losses|||
|Derivative financial assets|||
|Notes receivable|418,685,069.60|449,209,323.02|
|Accounts receivable|1,003,118,142.78|1,047,012,889.92|
|Account paid in advance|58,841,677.78|52,269,971.38|
|Interest receivable|228,052.78|97,627.77|
|Dividends receivable|532,862,944.82||
|Other receivables|178,153,549.80|50,174,653.16|
|Inventories|386,390,243.97|425,577,163.53|
|Assets held for sale|||
|Non-current assets due within one year|||
|Other current assets|4,394,258,562.40|3,876,370,675.52|

||||
|-|-|-|
|Total current assets|9,575,981,598.22|8,361,125,495.14|
|Non-current assets:|||
|Available-for-sale financial assets|403,296,360.00|512,202,869.00|
|Held-to-maturity investments|||
|Long-term receivables|||
|Long-term equity investments|5,052,525,076.38|4,962,522,689.49|
|Investment property|||
|Fixed assets|1,560,811,227.67|1,567,315,925.73|
|Construction in progress|59,671,595.15|29,152,398.74|
|Project materials|||
|Disposal of fixed assets|||
|Productive biological assets|||
|Oil and natural gas assets|||
|Intangible assets|192,303,346.51|196,726,670.75|
|Research and development costs|||
|Goodwill|||
|Long-term deferred expenses|||
|Deferred income tax assets|114,410,983.88|114,706,976.54|
|Other non-current assets|103,943,087.63|80,866,308.04|
|Total non-current assets|7,486,961,677.22|7,463,493,838.29|
|Total assets|17,062,943,275.44|15,824,619,333.43|
|Current liabilities:|||
|Short-term borrowings|180,000,000.00|78,000,000.00|
|Financial liability measured by fair value and with variation|||
|reckoned into current gains/losses|||
|Derivative financial liability|||
|Notes payable|381,906,378.48|459,762,950.78|
|Accounts payable|965,506,741.66|1,082,206,882.07|
|Accounts received in advance|11,405,762.35|12,242,442.51|
|Wage payable|196,370,045.34|216,598,203.73|
|Taxes payable|66,402,908.98|71,370,793.35|
|Interest payable|292,055.55|93,777.78|
|Dividend payable|1,210,740,700.00||
|Other accounts payable|13,611,772.35|9,982,668.55|

||||
|-|-|-|
|Liability held for sale|||
|Non-current liabilities due within one year|||
|Other current liabilities|||
|Total current liabilities|3,026,236,364.71|1,930,257,718.77|
|Non-current liabilities:|||
|Long-term loans|||
|Bonds payable|||
|Including: preferred stock|||
|Perpetual capital securities|||
|Long-term account payable|||
|Long-term wages payable|16,665,236.81|16,665,236.81|
|Special accounts payable|||
|Accrual liabilities|||
|Deferred income|395,256,852.69|407,070,636.08|
|Deferred income tax liabilities|5,094,154.34|15,382,844.99|
|Other non-current liabilities|||
|Total non-current liabilities|417,016,243.84|439,118,717.88|
|Total liabilities|3,443,252,608.55|2,369,376,436.65|
|Owners’ equity:|||
|Share capital|1,008,950,570.00|1,008,950,570.00|
|Other equity instrument|||
|Including: preferred stock|||
|Perpetual capital securities|||
|Capital reserve|3,488,221,286.39|3,488,221,286.39|
|Less: Inventory shares|||
|Other comprehensive income|28,866,874.66|87,169,455.01|
|Reasonable reserve|||
|Surplus reserve|510,100,496.00|510,100,496.00|
|Retained profit|8,583,551,439.84|8,360,801,089.38|
|Total owners’ equity|13,619,690,666.89|13,455,242,896.78|
|Total liabilities and owner’s equity|17,062,943,275.44|15,824,619,333.43|

3. Consolidated Profit Statement
In RMB
||||
|-|-|-|
|Item|Current period|Last Period|
|I. Total operating income|4,960,801,890.99|4,728,125,599.02|
|Including: Operating income|4,960,801,890.99|4,728,125,599.02|
|Interest income|||
|Insurance gained|||
|Commission charge and commission income|||
|II. Total operating cost|4,446,134,584.97|4,235,672,796.49|
|Including: Operating cost|3,889,590,289.69|3,736,290,938.86|
|Interest expense|||
|Commission charge and commission expense|||
|Cash surrender value|||
|Net amount of expense of compensation|||
|Net amount of withdrawal of insurance contract reserve|||
|Bonus expense of guarantee slip|||
|Reinsurance expense|||
|Operating tax and extras|38,000,352.40|37,862,282.48|
|Sales expenses|106,347,559.85|71,559,262.66|
|Administration expenses|413,983,378.78|399,568,734.73|
|Financial expenses|-1,776,908.37|1,688,051.32|
|Losses of devaluation of asset|-10,087.38|-11,296,473.56|
|Add: Changing income of fair value(Loss is listed with “-”)|||
|Investment income (Loss is listed with “-”)|1,149,033,168.39|955,437,915.36|
|Including: Investment income on affiliated company and joint|||
||968,640,145.91|833,565,520.64|
|venture|||
|Exchange income (Loss is listed with “-”)|||
|Income from assets disposal(Loss is listed with “-”)|1,588,185.36|-125,780.60|
|Other income|14,032,459.71|15,608,007.28|
|III. Operating profit (Loss is listed with “-”)|1,679,321,119.48|1,463,372,944.57|
|Add: Non-operating income|3,881,128.87|2,784,579.48|
|Less: Non-operating expense|2,327,872.38|3,764,224.66|
|IV. Total Profit (Loss is listed with “-”)|1,680,874,375.97|1,462,393,299.39|
|Less: Income tax expense|102,927,297.96|94,025,933.36|

||||
|-|-|-|
|V. Net profit (Net loss is listed with “-”)|1,577,947,078.01|1,368,367,366.03|
|(i) Net profit of continuous operating (Net loss is listed with “-”)|1,577,947,078.01|1,368,367,366.03|
|(ii) Net profit of business termination (Net loss is listed with “-”)|||
|Net profit attributable to owners of parent company|1,545,242,704.92|1,325,922,029.56|
|Minority shareholders’ gains and losses|32,704,373.09|42,445,336.47|
|VI. Net after-tax of other comprehensive income|-58,302,580.35|-39,797,212.50|
|Net after-tax of other comprehensive income attributable to owners|||
||-58,302,580.35|-39,797,212.50|
|of parent company|||
|(I) Other comprehensive income items which will not be|||
|reclassified subsequently to profit of loss|||
|1. Changes as a result of re-measurement of net defined benefit|||
|plan liability or asset|||
|2. Share of the other comprehensive income of the investee|||
|accounted for using equity method which will not be reclassified|||
|subsequently to profit and loss|||
|(II) Other comprehensive income items which will be reclassified|||
||-58,302,580.35|-39,797,212.50|
|subsequently to profit or loss|||
|1. Share of the other comprehensive income of the investee|||
|accounted for using equity method which will be reclassified|||
|subsequently to profit or loss|||
|2. Gains or losses arising from changes in fair value of|||
||-58,302,580.35|-39,797,212.50|
|available-for-sale financial assets|||
|3. Gains or losses arising from reclassification of|||
|held-to-maturity investment as available-for-sale financial assets|||
|4. The effect hedging portion of gains or losses arising from|||
|cash flow hedging instruments|||
|5. Translation differences arising on translation of foreign|||
|currency financial statements|||
|6.Other|||
|Net after-tax of other comprehensive income attributable to minority|||
|shareholders|||
|VII. Total comprehensive income|1,519,644,497.66|1,328,570,153.53|
|Total comprehensive income attributable to owners of parent|||
||1,486,940,124.57|1,286,124,817.06|
|Company|||
|Total comprehensive income attributable to minority shareholders|32,704,373.09|42,445,336.47|
|VIII. Earnings per share:|||
|(i) Basic earnings per share|1.53|1.31|
|(ii) Diluted earnings per share|1.53|1.31|

Enterprise combine under the same control in the Period, the combined party realized net profit of 0 Yuan before combination, and realized 0 Yuan at last period for combined party
Legal Representative: Chen Xuejun
Person in charge of accounting works: Ou Jianbin
Person in charge of accounting institute: Ou Jianbin
4. Profit Statement of Parent Company
In RMB
||||
|-|-|-|
|Item|Current period|Last Period|
|I. Operating income|2,315,142,655.13|1,626,480,415.71|
|Less: Operating cost|1,698,516,522.90|1,268,622,661.58|
|Operating tax and extras|20,760,852.64|14,826,758.76|
|Sales expenses|17,030,807.96|13,791,093.39|
|Administration expenses|216,259,763.11|184,157,736.45|
|Financial expenses|-5,330,079.95|-346,977.87|
|Losses of devaluation of asset|468,622.39|48,394.70|
|Add: Changing income of fair value(Loss is listed with “-”)|||
|Investment income (Loss is listed with “-”)|1,137,350,229.02|1,830,767,022.75|
|Including: Investment income on affiliated company and|||
||894,788,126.54|767,309,765.64|
|joint venture|||
|Income from assets disposal(Loss is listed with “-”)|698,843.73|-143,090.25|
|Other income|11,813,783.39|13,915,329.88|
|II. Operating profit (Loss is listed with “-”)|1,517,299,022.22|1,989,920,011.08|
|Add: Non-operating income|26,550.35|244,259.65|
|Less: Non-operating expense|989,892.95|2,088,732.14|
|III. Total Profit (Loss is listed with “-”)|1,516,335,679.62|1,988,075,538.59|
|Less: Income tax expense|82,844,629.16|47,444,108.88|
|IV. Net profit (Net loss is listed with “-”)|1,433,491,050.46|1,940,631,429.71|
|(i) Net profit of continuous operating (Net loss is listed with “-”)|1,433,491,050.46|1,940,631,429.71|
|(ii) Net profit of business termination (Net loss is listed with “-”)|||
|V. Net after-tax of other comprehensive income|-58,302,580.35|-39,797,212.50|
|(I) Other comprehensive income items which will not be|||
|reclassified subsequently to profit of loss|||
|1. Changes as a result of re-measurement of net defined benefit|||
|plan liability or asset|||
|2. Share of the other comprehensive income of the investee|||

||||
|-|-|-|
|accounted for using equity method which will not be reclassified|||
|subsequently to profit and loss|||
|(II) Other comprehensive income items which will be|||
||-58,302,580.35|-39,797,212.50|
|reclassified subsequently to profit or loss|||
|1. Share of the other comprehensive income of the investee|||
|accounted for using equity method which will be reclassified|||
|subsequently to profit or loss|||
|2. Gains or losses arising from changes in fair value of|||
||-58,302,580.35|-39,797,212.50|
|available-for-sale financial assets|||
|3. Gains or losses arising from reclassification of|||
|held-to-maturity investment as available-for-sale financial assets|||
|4. The effect hedging portion of gains or losses arising from|||
|cash flow hedging instruments|||
|5. Translation differences arising on translation of foreign|||
|currency financial statements|||
|6.Other|||
|VI. Total comprehensive income|1,375,188,470.11|1,900,834,217.21|
|VII. Earnings per share:|||
|(i) Basic earnings per share|||
|(ii) Diluted earnings per share|||

5. Consolidated Cash Flow Statement
In RMB
||||
|-|-|-|
|Item|Current period|Last Period|
|I. Cash flows arising from operating activities:|||
|Cash received from selling commodities and providing labor|||
||4,321,753,642.57|3,437,449,626.28|
|services|||
|Net increase of customer deposit and interbank deposit|||
|Net increase of loan from central bank|||
|Net increase of capital borrowed from other financial|||
|institution|||
|Cash received from original insurance contract fee|||
|Net cash received from reinsurance business|||
|Net increase of insured savings and investment|||
|Net increase of amount from disposal financial assets that|||
|measured by fair value and with variation reckoned into current|||
|gains/losses|||

||||
|-|-|-|
|Cash received from interest, commission charge and|||
|commission|||
|Net increase of capital borrowed|||
|Net increase of returned business capital|||
|Write-back of tax received|28,784,608.45|22,168,009.92|
|Other cash received concerning operating activities|20,879,944.10|19,713,087.22|
|Subtotal of cash inflow arising from operating activities|4,371,418,195.12|3,479,330,723.42|
|Cash paid for purchasing commodities and receiving labor|||
||2,812,244,020.34|2,032,254,137.91|
|service|||
|Net increase of customer loans and advances|||
|Net increase of deposits in central bank and interbank|||
|Cash paid for original insurance contract compensation|||
|Cash paid for interest, commission charge and commission|||
|Cash paid for bonus of guarantee slip|||
|Cash paid to/for staff and workers|683,701,600.44|614,817,453.84|
|Taxes paid|342,578,412.02|325,770,301.21|
|Other cash paid concerning operating activities|153,970,471.84|154,087,588.94|
|Subtotal of cash outflow arising from operating activities|3,992,494,504.64|3,126,929,481.90|
|Net cash flows arising from operating activities|378,923,690.48|352,401,241.52|
|II. Cash flows arising from investing activities:|||
|Cash received from recovering investment|5,361,095,457.96|3,091,512,477.03|
|Cash received from investment income|463,686,171.47|430,252,079.05|
|Net cash received from disposal of fixed, intangible and other|||
||39,773,802.87|53,235,402.65|
|long-term assets|||
|Net cash received from disposal of subsidiaries and other|||
|units|||
|Other cash received concerning investing activities|||
|Subtotal of cash inflow from investing activities|5,864,555,432.30|3,574,999,958.73|
|Cash paid for purchasing fixed, intangible and other long-term|||
||362,947,568.87|212,687,557.71|
|assets|||
|Cash paid for investment|6,084,063,284.96|5,925,993,243.66|
|Net increase of mortgaged loans|||
|Net cash received from subsidiaries and other units|||
|Other cash paid concerning investing activities|10,000,000.00||
|Subtotal of cash outflow from investing activities|6,457,010,853.83|6,138,680,801.37|

||||
|-|-|-|
|Net cash flows arising from investing activities|-592,455,421.53|-2,563,680,842.64|
|III. Cash flows arising from financing activities|||
|Cash received from absorbing investment|||
|Including: Cash received from absorbing minority|||
|shareholders’ investment by subsidiaries|||
|Cash received from loans|330,000,000.00|185,000,000.00|
|Cash received from issuing bonds|||
|Other cash received concerning financing activities|5,470,000.00||
|Subtotal of cash inflow from financing activities|335,470,000.00|185,000,000.00|
|Cash paid for settling debts|219,000,000.00|152,500,000.00|
|Cash paid for dividend and profit distributing or interest|||
||9,337,888.74|17,164,736.59|
|paying|||
|Including: Dividend and profit of minority shareholder paid by|||
||174,600.00|11,958,920.00|
|subsidiaries|||
|Other cash paid concerning financing activities|339,091.00|1,049,711.28|
|Subtotal of cash outflow from financing activities|228,676,979.74|170,714,447.87|
|Net cash flows arising from financing activities|106,793,020.26|14,285,552.13|
|IV. Influence on cash and cash equivalents due to fluctuation in|||
||810,171.83|-3,018,810.88|
|exchange rate|||
|V. Net increase of cash and cash equivalents|-105,928,538.96|-2,200,012,859.87|
|Add: Balance of cash and cash equivalents at the period-begin|2,948,439,354.22|3,795,223,678.11|
|VI. Balance of cash and cash equivalents at the period-end|2,842,510,815.26|1,595,210,818.24|

 6. Cash Flow Statement of Parent Company
In RMB
||||
|-|-|-|
|Item|Current period|Last Period|
|I. Cash flows arising from operating activities:|||
|Cash received from selling commodities and providing labor|||
||2,707,966,926.41|1,138,848,252.21|
|services|||
|Write-back of tax received|||
|Other cash received concerning operating activities|9,047,393.86|505,652,991.97|
|Subtotal of cash inflow arising from operating activities|2,717,014,320.27|1,644,501,244.18|
|Cash paid for purchasing commodities and receiving labor|||
||1,572,426,004.69|707,951,478.67|
|service|||
|Cash paid to/for staff and workers|361,672,047.87|277,978,923.53|

||||
|-|-|-|
|Taxes paid|242,573,191.33|133,461,523.26|
|Other cash paid concerning operating activities|142,557,335.52|168,294,750.99|
|Subtotal of cash outflow arising from operating activities|2,319,228,579.41|1,287,686,676.45|
|Net cash flows arising from operating activities|397,785,740.86|356,814,567.73|
|II. Cash flows arising from investing activities:|||
|Cash received from recovering investment|5,174,745,373.00|2,974,601,492.00|
|Cash received from investment income|450,095,688.15|1,365,386,425.45|
|Net cash received from disposal of fixed, intangible and other|||
||38,214,564.65|52,252,940.94|
|long-term assets|||
|Net cash received from disposal of subsidiaries and other units||2,410,502.57|
|Other cash received concerning investing activities|||
|Subtotal of cash inflow from investing activities|5,663,055,625.80|4,394,651,360.96|
|Cash paid for purchasing fixed, intangible and other long-term|||
||187,935,182.03|61,095,071.88|
|assets|||
|Cash paid for investment|5,687,713,200.00|5,617,929,258.63|
|Net cash received from subsidiaries and other units|||
|Other cash paid concerning investing activities|173,000,000.00||
|Subtotal of cash outflow from investing activities|6,048,648,382.03|5,679,024,330.51|
|Net cash flows arising from investing activities|-385,592,756.23|-1,284,372,969.55|
|III. Cash flows arising from financing activities|||
|Cash received from absorbing investment|||
|Cash received from loans|180,000,000.00|80,000,000.00|
|Cash received from issuing bonds|||
|Other cash received concerning financing activities|||
|Subtotal of cash inflow from financing activities|180,000,000.00|80,000,000.00|
|Cash paid for settling debts|78,000,000.00|80,000,000.00|
|Cash paid for dividend and profit distributing or interest paying|3,391,380.55|1,637,133.32|
|Other cash paid concerning financing activities|||
|Subtotal of cash outflow from financing activities|81,391,380.55|81,637,133.32|
|Net cash flows arising from financing activities|98,608,619.45|-1,637,133.32|
|IV. Influence on cash and cash equivalents due to fluctuation in|||
||761,175.27|-3,018,810.88|
|exchange rate|||
|V. Net increase of cash and cash equivalents|111,562,779.35|-932,214,346.02|
|Add: Balance of cash and cash equivalents at the period -begin|2,454,696,969.20|2,143,377,059.99|
|VI. Balance of cash and cash equivalents at the period-end|2,566,259,748.55|1,211,162,713.97|

7. Statement of Changes inOwners’ Equity (Consolidated)
Amount for current period
In RMB
|||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
||Current period|||||||||||||
||Owners’ equity attributable to parent company|||||||||||||
|||Other||||||||Provisio||||
|Item||||||||||||Minority|Total owners’|
|||equity instrument||||Less:|Other||Surplus|n of||||
||Share capital||||Capital reserve|Inventor|comprehensiv|Reasonable|||Retained profit|interests|equity|
||||Perpetual|||||reserve|reserve|general||||
|||Preferre|capital|Oth||y shares|e income|||||||
|||d stock||er||||||risk||||
||||securities|||||||||||
|I. Balance at||||||||||||||
||1,008,950,570.0||||3,417,841,402.8||||510,100,496.0|||515,693,194.4|15,351,366,864.2|
|the end of the|||||||87,169,455.01|2,606.93|||9,811,609,138.92|||
||0||||9||||0|||8|3|
|last year||||||||||||||
|Add: Changes||||||||||||||
|of accounting||||||||||||||
|policy||||||||||||||
|Error||||||||||||||
|correction of||||||||||||||
|the last period||||||||||||||
|Enterpris||||||||||||||
|e combine||||||||||||||
|under the||||||||||||||
|same control||||||||||||||
|Other||||||||||||||
|II. Balance at|1,008,950,570.0||||3,417,841,402.8||||510,100,496.0|||515,693,194.4|15,351,366,864.2|
||||||||87,169,455.01|2,606.93|||9,811,609,138.92|||
|the beginning|0||||9||||0|||8|3|

||||||||
|-|-|-|-|-|-|-|
|of this year|||||||
|III. Increase/|||||||
|Decrease in|||||||
|this year||-58,302,580.3|||||
||-1,824,597.47||1,116,994.89|334,502,004.92|4,374,207.74|279,866,029.73|
|(Decrease is||5|||||
|listed with|||||||
|“-”)|||||||
|(i) Total|||||||
|||-58,302,580.3|||||
|comprehensiv||||1,545,242,704.92|32,704,373.09|1,519,644,497.66|
|||5|||||
|e income|||||||
|(ii) Owners’|||||||
|devoted and|||||-12,945,402.5||
||-1,824,597.47|||||-14,770,000.00|
|decreased|||||3||
|capital|||||||
|1.Common|||||||
|shares|||||-12,945,402.5||
|||||||-12,945,402.53|
|invested by|||||3||
|shareholders|||||||
|2. Capital|||||||
|invested by|||||||
|holders of|||||||
|other equity|||||||
|instruments|||||||
|3. Amount|||||||
|reckoned into|||||||
|owners equity|||||||
|with|||||||
|share-based|||||||

||||||
|-|-|-|-|-|
|payment|||||
|4. Other|-1,824,597.47|||-1,824,597.47|
|(III) Profit||-1,210,740,700.0|-15,604,600.0|-1,226,345,300.0|
|distribution||0|0|0|
|1. Withdrawal|||||
|of surplus|||||
|reserves|||||
|2. Withdrawal|||||
|of general risk|||||
|provisions|||||
|3.|||||
|Distribution||-1,210,740,700.0|-15,604,600.0|-1,226,345,300.0|
|for owners (or||0|0|0|
|shareholders)|||||
|4. Other|||||
|(IV) Carrying|||||
|forward|||||
|internal|||||
|owners’|||||
|equity|||||
|1. Capital|||||
|reserves|||||
|conversed to|||||
|capital (share|||||
|capital)|||||
|2. Surplus|||||
|reserves|||||
|conversed to|||||

||||||||||
|-|-|-|-|-|-|-|-|-|
|capital (share|||||||||
|capital)|||||||||
|3. Remedying|||||||||
|loss with|||||||||
|surplus|||||||||
|reserve|||||||||
|4. Other|||||||||
|(V)|||||||||
|Reasonable||||1,116,994.89|||219,837.18|1,336,832.07|
|reserve|||||||||
|1. Withdrawal|||||||||
|||||10,050,468.8|||||
|in the report|||||||1,395,689.84|11,446,158.69|
|||||5|||||
|period|||||||||
|2. Usage in|||||||||
|the report||||8,933,473.96|||1,175,852.66|10,109,326.62|
|period|||||||||
|(VI)Others|||||||||
|IV. Balance at||||||||15,631,232,893.96|
||1,008,950,570.0|3,416,016,805.4|||510,100,496.0|10,146,111,143.8|520,067,402.2||
|the end of the|||28,866,874.66|1,119,601.82|||||
||0|2|||0|4|2||
|report period|||||||||

Amount for last year
In RMB
|||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
||Last period|||||||||||||
||Owners’ equity attributable to parent company|||||||||||||
|||Other||||||||||||
|||equity||||||||||||
|||instrument||||||||Prov||||
|Item|||Pe|||Less:||||ision||Minority||
||||rp|||Inve|Other|||of|||Total owners’ equity|
||Share capital|Prefe|etu||Capital reserve|ntory|comprehensiveincome|Reasonable|Surplus reserve||Retained profit|interests||
||||al|||||reserve||gene||||
|||rre|capit|Othe||shar||||ral||||
|||d||||es||||||||
||||al|r||||||risk||||
|||sto|se|||||||||||
|||ck|cu|||||||||||
||||riti|||||||||||
||||es|||||||||||
|I. Balance at the end||||||||||||||
||1,008,950,570.00||||3,417,841,402.89||144,722,827.51|89,005.19|510,100,496.00||7,845,639,990.88|471,086,098.05|13,398,430,390.52|
|of the last year||||||||||||||
|Add: Changes of||||||||||||||
|accounting policy||||||||||||||
|Error correction||||||||||||||
|of the last period||||||||||||||
|Enterprise||||||||||||||
|combine under the||||||||||||||
|same control||||||||||||||
|Other||||||||||||||
|II. Balance at the||||||||||||||
|beginning of this|1,008,950,570.00||||3,417,841,402.89||144,722,827.51|89,005.19|510,100,496.00||7,845,639,990.88|471,086,098.05|13,398,430,390.52|
|year||||||||||||||

|||||||
|-|-|-|-|-|-|
|III. Increase/||||||
|Decrease in this year||||||
||-57,553,372.50|-86,398.26|1,965,969,148.04|44,607,096.43|1,952,936,473.71|
|(Decrease is listed||||||
|with “-”)||||||
|(i) Total||||||
|comprehensive|-57,553,372.50||2,571,339,490.04|75,870,434.54|2,589,656,552.08|
|income||||||
|(ii) Owners’||||||
|devoted and||||8,480,761.72|8,480,761.72|
|decreased capital||||||
|1.Common shares||||||
|invested by||||9,520,000.00|9,520,000.00|
|shareholders||||||
|2. Capital invested||||||
|by holders of other||||||
|equity instruments||||||
|3. Amount reckoned||||||
|into owners equity||||||
|with share-based||||||
|payment||||||
|4. Other||||-1,039,238.28|-1,039,238.28|
|(III) Profit||||||
||||-605,370,342.00|-39,650,290.00|-645,020,632.00|
|distribution||||||
|1. Withdrawal of||||||
|surplus reserves||||||
|2. Withdrawal of||||||
|general risk||||||

||||||||||
|-|-|-|-|-|-|-|-|-|
|provisions|||||||||
|3. Distribution for|||||||||
|owners (or||||||-605,370,342.00|-39,650,290.00|-645,020,632.00|
|shareholders)|||||||||
|4. Other|||||||||
|(IV) Carrying|||||||||
|forward internal|||||||||
|owners’ equity|||||||||
|1. Capital reserves|||||||||
|conversed to capital|||||||||
|(share capital)|||||||||
|2. Surplus reserves|||||||||
|conversed to capital|||||||||
|(share capital)|||||||||
|3. Remedying loss|||||||||
|with surplus reserve|||||||||
|4. Other|||||||||
|(V) Reasonable|||||||||
|||||-86,398.26|||-93,809.83|-180,208.09|
|reserve|||||||||
|1. Withdrawal in the|||||||||
|||||17,947,661.67|||2,379,810.36|20,327,472.03|
|report period|||||||||
|2. Usage in the|||||||||
|||||18,034,059.93|||2,473,620.19|20,507,680.12|
|report period|||||||||
|(VI)Others|||||||||
|IV. Balance at the|||||||||
|end of the report|1,008,950,570.00|3,417,841,402.89|87,169,455.01|2,606.93|510,100,496.00|9,811,609,138.92|515,693,194.48|15,351,366,864.23|
|period|||||||||

8. Statement of Changes inOwners’ Equity (Parent Company)
Amount for current period
In RMB
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
||Current period|||||||||||
|||Other||||||||||
|||equity||||||||||
|||||||Less||||||
|||instrument||||||||||
|||||||:||||||
||||Pe|||||||||
|Item|||rp|||Inve|Other|Reasonable||||
||Share capital|Pr|etu||Capital reserve|ntor|comprehensiv||Surplus reserve|Retained profit|Total owners’ equity|
||||al|||||reserve||||
|||eferre|ca|Ot||y|e income|||||
|||d|pit|he||shar||||||
||||al|r||||||||
|||sto|se|||es||||||
|||ck||||||||||
||||cu|||||||||
||||riti|||||||||
||||es|||||||||
|I. Balance at the end of the last year|1,008,950,570.00||||3,488,221,286.39||87,169,455.01||510,100,496.00|8,360,801,089.38|13,455,242,896.78|
|Add: Changes of accounting policy||||||||||||
|Error correction of the last period||||||||||||
|Other||||||||||||
|II. Balance at the beginning of this year|1,008,950,570.00||||3,488,221,286.39||87,169,455.01||510,100,496.00|8,360,801,089.38|13,455,242,896.78|
|III. Increase/ Decrease in this year|||||||-58,302,580.3|||||
|||||||||||222,750,350.46|164,447,770.11|
|(Decrease is listed with “-”)|||||||5|||||
||||||||-58,302,580.3|||||
|(i) Total comprehensive income||||||||||1,433,491,050.46|1,375,188,470.11|
||||||||5|||||
|(ii) Owners’ devoted and decreased||||||||||||
|capital||||||||||||

|||||||||
|-|-|-|-|-|-|-|-|
|1.Common shares invested by||||||||
|shareholders||||||||
|2. Capital invested by holders of other||||||||
|equity instruments||||||||
|3. Amount reckoned into owners equity||||||||
|with share-based payment||||||||
|4. Other||||||||
|(III) Profit distribution||||||-1,210,740,700.00|-1,210,740,700.00|
|1. Withdrawal of surplus reserves||||||||
|2. Distribution for owners (or||||||||
|||||||-1,210,740,700.00|-1,210,740,700.00|
|shareholders)||||||||
|3. Other||||||||
|(IV) Carrying forward internal owners’||||||||
|equity||||||||
|1. Capital reserves conversed to capital||||||||
|(share capital)||||||||
|2. Surplus reserves conversed to capital||||||||
|(share capital)||||||||
|3. Remedying loss with surplus reserve||||||||
|4. Other||||||||
|(V) Reasonable reserve||||||||
|1. Withdrawal in the report period||||3,751,960.66|||3,751,960.66|
|2. Usage in the report period||||3,751,960.66|||3,751,960.66|
|(VI)Others||||||||
|IV. Balance at the end of the report period|1,008,950,570.00|3,488,221,286.39|28,866,874.66||510,100,496.00|8,583,551,439.84|13,619,690,666.89|

Amount for last year
In RMB
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
||Last period|||||||||||
|||Other equity||||||||||
|||||||Less||||||
|||instrument||||||||||
|||||||:||||||
||||Perp|||Inve|Other|||||
|Item||Pr|etua|||||Reasonable||||
||Share capital||||Capital reserve|ntor|comprehensive||Surplus reserve|Retained profit|Total owners’ equity|
|||efe|l|||||reserve||||
|||rre|capi|Ot||y|income|||||
|||d|tal|her||||||||
|||sto|secu|||shar||||||
|||ck|ritie|||es||||||
||||s|||||||||
|I. Balance at the end of the last year|1,008,950,570.00||||3,448,408,786.39||144,722,827.51||510,100,496.00|5,525,644,079.79|10,637,826,759.69|
|Add: Changes of accounting policy||||||||||||
|Error correction of the last period||||||||||||
|Other||||||||||||
|II. Balance at the beginning of this year|1,008,950,570.00||||3,448,408,786.39||144,722,827.51||510,100,496.00|5,525,644,079.79|10,637,826,759.69|
|III. Increase/ Decrease in this year||||||||||||
||||||39,812,500.00||-57,553,372.50|||2,835,157,009.59|2,817,416,137.09|
|(Decrease is listed with “-”)||||||||||||
|(i) Total comprehensive income|||||||-57,553,372.50|||3,001,267,943.68|2,943,714,571.18|
|(ii) Owners’ devoted and decreased||||||||||||
|capital||||||||||||
|1.Common shares invested by||||||||||||
|shareholders||||||||||||
|2. Capital invested by holders of other||||||||||||
|equity instruments||||||||||||
|3. Amount reckoned into owners equity||||||||||||
|with share-based payment||||||||||||

|||||||||
|-|-|-|-|-|-|-|-|
|4. Other||||||||
|(III) Profit distribution||||||-605,370,342.00|-605,370,342.00|
|1. Withdrawal of surplus reserves||||||||
|2. Distribution for owners (or||||||||
|||||||-605,370,342.00|-605,370,342.00|
|shareholders)||||||||
|3. Other||||||||
|(IV) Carrying forward internal owners’||||||||
|equity||||||||
|1. Capital reserves conversed to capital||||||||
|(share capital)||||||||
|2. Surplus reserves conversed to capital||||||||
|(share capital)||||||||
|3. Remedying loss with surplus reserve||||||||
|4. Other||||||||
|(V) Reasonable reserve||||||||
|1. Withdrawal in the report period||||4,785,959.00|||4,785,959.00|
|2. Usage in the report period||||4,785,959.00|||4,785,959.00|
|(VI)Others||39,812,500.00||||439,259,407.91|479,071,907.91|
|IV. Balance at the end of the report period|1,008,950,570.00|3,488,221,286.39|87,169,455.01||510,100,496.00|8,360,801,089.38|13,455,242,896.78|

III. Basic information of the Company
1. Historical origin of the Company
By the approval of STGS (1992) No. 130 issued by Jiangsu Economic Restructuring Committee, Weifu High-Technology Group Co., Ltd. (hereinafter referred to “the Company” or “Company”) was established as a company of limited liability with funds raised from targeted sources, and registered at Wuxi Administration for Industry& Commerce in October 1992. The original share capital of the Company totaled RMB 115.4355 million, including state-owned share capital amounting to RMB 92.4355 million, public corporate share capital amounting to RMB 8 million and inner employee share capital amounting to RMB 15 million.
Between year of 1994 and 1995, the Company was restructured and became a holding subsidiary of Wuxi Weifu Group Co., Ltd (hereinafter referred to as “Weifu Group”).
By the approval of Jiangsu ERC and Shenzhen Securities Administration Office in August 1995, the Company issued 68 million special ordinary shares (B-share) with value of RMB 1.00 for each, and the total value of those shares amounted to RMB 68 million. After the issuance, theCompany’s total share capital increased to RMB 183.4355 million.
By the approval of CSRC in June 1998, the Company issued 120 million RMB ordinary shares (A-share) at Shenzhen Stock Exchange through on-line pricing and issuing. After the issuance, the total share capital of the Company amounted to RMB 303.4355 million.
In the middle of 1999, deliberated and approved by the Board andShareholders’ General Meeting, the Company implemented the plan of granting 3 bonus shares for each 10 shares. After that, the total share capital of the Company amounted to RMB 394.46615 million, of which state-owned shares amounted to RMB 120.16615 million, public corporate shares RMB 10.4 million, foreign-funded shares (B-share) RMB 88.40 million, RMB ordinary shares (A-share) RMB 156 million and inner employee shares RMB 19.5 million.
In the year 2000, by the approval of the CSRC and based upon the total share capital of 303.4355 million shares after the issuance of A-share in June 1998, the Company allotted 3 shares for each 10 shares, with a price of RMB 10 for each allotted share. Actually 41.9 million shares was allotted, and the total share capital after the allotment increased to RMB 436.36615 million, of which state-owned corporate shares amounted to RMB 121.56615 million, public corporate shares RMB 10.4 million, foreign-funded shares (B-share) RMB 88.4 million and RMB ordinary shares (A-share) RMB 216 million.
In April 2005, Board of Directors of the Company has examined and approved 2004 Profit Pre-distribution Plan, and examined and approved by 2004Shareholders’ General Meeting , the Company distributed 3 shares for each 10 shares to the whole shareholders totaling to 130,909,845 shares in 2005.
According to the Share Merger Reform Scheme of the Company that passed by relatedshareholders’ meeting of Share Merger Reform and SGZF[2006] No.61 Reply on Questions about State-owned Equity Management in Share Merger Reform of Weifu High-Technology Co., Ltd. issued by State-owned Assets Supervision& Administration Commission of Jiangsu Province, the Weifu Group etc. 8 non-circulating shareholders arranged pricing with granting 1.7 shares for each 10 shares to circulating A-share shareholders (totally granted 47,736,000 shares), so as to realize the originally non-circulating shares can be traded on market when satisfied certain conditions, the scheme has been implemented on April 5, 2006.
On 27 May 2009, Weifu Group satisfied the consideration arrangement by dispatching 0.5 shares for each 10 shares based on the number of circulating A share as prior to Share Merger Reform, according to the aforesaid Share Merger Reform, with an aggregate of 14,039,979 shares dispatched. Subsequent to implementation of dispatch of consideration shares, Weifu Group then held 100,021,999 shares of the Company, representing17.63% of the total share capital of the Company.
Pursuant to the document (XGZQ(2009)No.46) about “Approval for Merger of Wuxi Weifu Group Co., Ltd. by Wuxi Industry Development Group Co., Ltd.” issued by the State-owned Assets Supervision and Administration Commission of Wuxi City Government, Wuxi Industry Development Group Co., Ltd. (hereinafter referred to as Wuxi Industry Group) acquired Weifu Group. After the merger, Weifu Group was then revoked, and its assets and credits& debts were transferred to be under the name of Wuxi Industry Group. Accordingly, Wuxi Industry Group became the first largest shareholder of the Company since then.
In accordance with the resolutions of shareholders' meeting and provisions of amended constitution, and approved by[2012] No. 109 document of China Securities Regulatory Commission, in Feb., the Company issued RMB ordinary shares (A-share) of 112,858,000 shares to Wuxi Industry Groups and overseas strategic investor, ROBERT BOSCH GMBH (hereinafter referred to as Germany BOSCH), face value was RMB 1 Yuan per share, added registered capital of RMB112,858,000 Yuan , and the registered capital after change was RMB 680,133,995 Yuan. Wuxi Industry Group is the first majority shareholder of the Company, and Germany BOSCH is the second majority shareholder of the Company.
In March 2013, the profit distribution pre-plan for year of 2012 was deliberated and approved by the Board, and also passed in Annual General Meeting 2012 of the Company in May 2013. On basis of total share capital 680,133,995 shares, distribute 5-share for every 10 shares held by whole shareholders, 340,066,997 shares in total are distributed. Total share capital of the Company amounting RMB 1,020,200,992 up to 31 December 2013. Deliberated and approved by thecompany’s first extraordinary general meeting in 2015, the company has repurchased 11,250,422 shares of A shares from August 26, 2015 to September 8, 2015, and has finished the cancellation procedures for above repurchase shares in China Securities Depository and Clearing Corporation Limited Shenzhen Branch on September 16, 2015; after the cancellation of repurchase shares, thecompany’s paid-up capital (capital) becomes RMB 1,008,950,570 Yuan after the change.
2. Registered place, organization structure and head office of the Company
Registered place and head office of the Company: No. 5 Huashan Road, New District, Wuxi
Unified social credit code: 91320200250456967N
The Company sets upShareholders’ General Meeting, the Board of Directors and the Supervisory Committee. The Company sets up Administration Department, Technology Centre, organization& personnel department, Office of the Board, compliance department, IT department, Market& Strategy Department, Party-masses Department, Finance Department, Purchase Department, Manufacturing Quality Department, MS (Mechanical System) division, AC(Auto spare parts) division and DS (Diesel System ) division etc. and subsidiaries such as Wuxi Weifu Leader Catalytic Converter Co., Ltd. and Nanjing Weifu Jinning Co., Ltd.
3. Business nature and major operation activities of the Company
Operation scope of parent company: Technology development and consulting service in the machinery industry; manufacture of engine fuel oil system products, fuel oil system testers and equipments, manufacturing of auto electronic parts, automotive electrical components, non-standard equipment, non-standard knife tool and exhaust post-processing system; sales of the general machinery, hardware& electrical equipment, chemical products& raw materials (excluding hazardous chemicals), auto spare parts and vehicles (excluding nine-seat passenger car); internal combustion engine maintenance; leasing of the own houses; import and export business in respect of diversified commodities and technologies (other than those commodities and technologies limited or forbidden by the State for import and export) by self-operation and works as agent for such business. (Any projects that needs to be approved by laws can only be carried out after getting approval by relevant authorities)
Major subsidiaries respectively activate in production and sales of engine accessories, auto spare parts, mufflers, and purifiers.
4. Relevant party offering approval reporting of financial statements and date thereof
Financial statements of the Company were approved by the Board of Directors for reporting dated 24 August 2018.
|||||||||
|-|-|-|-|-|-|-|-|
|Name of subsidiary|Shortname ofsubsidiary|Shareholding ratio(%)||Proportionof votes(%)|Registeredcapital (in10 thousandYuan)|Business scope|Statementconsolidate(Y/N)|
|||Directly|Indirectly|||||
|Nanjing Weifu Jinning Co., Ltd.|Weifu Jinning|80.00|--|80.00|34,628.70|Internal-combustionengine andaccessories|Y|
|Wuxi Weifu Leader CatalyticConverter Co., Ltd.|Weifu Leader|94.81|--|94.81|50,259.63|Purifier and muffler|Y|
|Weifu Mashan Pump Glib Co., Ltd.|Weifu Mashan|100.00|--|100.00|16,500|Internal-combustionengine andaccessories|Y|
|Wuxi Weifu Chang’an Co., Ltd.|Weifu Chang’an|100.00|--|100.00|21,000|Internal-combustion|Y|

|||||||||
|-|-|-|-|-|-|-|-|
|||||||engine andaccessories||
|Wuxi Weifu International Trade Co.Ltd.|WeifuInternationalTrade|100.00|--|100.00|3,000|Trade|Y|
|Wuxi Weifu ITM SuperchargingTechnique Co., Ltd.|Weifu ITM|100.00|--|100.00|16,000|Internal-combustionengine andaccessories|Y|
|Wuxi Weifu Schmidt Power SystemSpare Parts Co., Ltd.|Weifu Schmidt|66.00|--|66.00|7,600|Internal-combustionengine andaccessories|Y|
|Ningbo Weifu Tianli SuperchargingTechnique Co., Ltd.|Weifu Tianli|54.23|--|54.23|11,136|Internal-combustionengine andaccessories|Y|
|Wuxi Weifu-Autocam Fine MachineryCo. Ltd.|Weifu Autocam|51.00|--|51.00|USD1,510|Auto parts|Y|
|Wuxi Weifu Leader CatalyticConverter (Wuhan) Co., Ltd.|Weifu Leader(Wuhan)|--|60.00|60.00|1,000|Purifier and muffler|Y|
|Weifu Leader (Chongqing)Automobile Parts Co., Ltd.|Weifu Leader(Chongqing)|--|100.00|100.00|2,615.17|Purifier and muffler|Y|
|Nanchang Weifu Leader AutomobileParts Co., Ltd.|Weifu Leader(Nanchang)|--|100.00|100.00|5,000|Purifier and muffler|Note ①|

Note①: Found more in5-‘Change of consolidation scope for other reasons” in Note VIII
IV. Basis of preparation of financial statements
1. Preparation base
The financial statement were stated in compliance with Accounting Standard for Business Enterprises–Basic Norms issued by Ministry of Finance, the specific 41 accounting rules revised and issued dated 15 February 2006 and later, the Application Instruments of Accounting Standards and interpretation on Accounting standards and other relevant regulations (together as “Accounting Standards for Business Enterprise”), as well as the Compilation Rules for Information Disclosure by Companies Offering Securities to the Public No.15– General Provision of Financial Report (Amended in 2014) issued by CSRC in respect of the actual transactions and proceedings, on a basis of ongoing operation.
In line with relevant regulations of Accounting Standards of Business Enterprise, accounting of the Company is on accrual basis. Except for certain financial instruments, the financial statement measured on historical cost. Assets have impairment been found, corresponding depreciation reserves shall accrual according to relevant rules. 2. Going concern
The Company comprehensively assessed the available information, and there are no obvious factors that impact
sustainable operation ability of the Company within 12 months since end of the reporting period.
V. Major Accounting Policies and Estimation
Specific accounting policies and estimation attention:
The Company and its subsidiaries are mainly engaged in the manufacture and sales of engine fuel oil system products, Auto spare parts, mufflers and purifiers etc., in line with the real operational characteristics and relevant accounting standards, many specific accounting policies and estimation have been formulated for the transactions and events with revenue recognized concerned. As for the explanation on major accounting judgment and estimation, found more in Note V-28-“Other major accounting policy and accounting estimation”.
1. Statement on observation of Accounting Standard for Business Enterprises
Financial statements prepared by the Company were in accordance with requirements of Accounting Standard for Business Enterprises, which truly and completely reflected the financial information of the Company in the period, such as financial position, operation achievements and cash flow.
2. Accounting period
Accounting period of the Company consist of annual and mid-term, mid-term refers to the reporting period shorter than one annual accounting year. The company adopts Gregorian calendar as accounting period, namely form each 1 January to 31 December.
3. Business cycles
Normal business cycle is the period from purchasing assets used for process by the Company to the cash and cash equivalent achieved. TheCompany’s normal business cycle was one-year (12 months).
4. Recording currency
TheCompany’s reporting currency is the RMB Yuan.
5. Accounting Treatment Method for Business Combinations
Business combination is the transaction or events that two or two above independent enterprises combined as a reporting entity. Business combination including enterprise combined under the same control and business combined under different control.
(1) The business combination under the same control
Enterprise combination under the same control is the enterprise who take part in the combination are have the same ultimate controller or under the same controller, the control is not temporary. The assets and liability acquired by combining party are measured by book value of the combined party on combination date. Balance of netasset’s book value acquired by combining party and combine consideration paid (or total book value of the shares issued), shall adjusted capital reserve (share premium); if the capital reserves (share premium) is not enough for deducted, adjusted for retained earnings. Vary directly expenses occurred for enterprise combination,
the combining party shall reckoned into current gains/losses while occurring. Combination day is the date when combining party obtained controlling rights from the combined party.
(2) Combine not under the same control
A business combination not involving entities under common control is a business combination in which all of the combining entities are not ultimately controlled by the same party or parties both before and after the combination. As a purchaser, fair value of the assets (equity of acquiree held before the date of purchasing included) for purchasing controlling right from the acquiree, the liability occurred or undertake on purchasing date less the fair value of identifiable net assets of the acquiree obtained in combination, recognized as goodwill if the results is positive; if the number is negative, the acquirer shall firstly review the measurement of the fair value of the identifiable assets obtained, liabilities incurred and contingent liabilities incurred, as well as the combination costs. After that, if the combination costs are still lower than the fair value of the identifiable net assets obtained, the acquirer shall recognize the difference as the profit or loss in the current period. Other directly expenses cost for combination shall be reckoned into current gains/losses. Difference of the fair value of assets paid and its book values, reckoned into current gains/losses. On purchasing date, the identifiable assets, liability or contingency of the acquiree obtained by the Company recognized by fair value, that required identification conditions; Acquisition date refers to the date on which the acquirer effectively obtains control of the acquiree.
6. Preparation method for consolidated financial statement
(1) Recognition principle of consolidated scope
On basis of the financial statement of the parent company and owned subsidiaries, prepared consolidated statement in line with relevant information. The scope of consolidation of consolidated financial statements is ascertained on the basis of effective control. Once certain elements involved in the above definition of control change due to changes of relevant facts or circumstances, the Company will make separate assessment.
(2) Basis of control
Control is the right to govern an investee so as to obtain variable return through participating in theinvestee’s relevant activities and the ability to affect such return by use of the aforesaid right over the investee. Relevant activates refers to activates have major influence on return of theinvestee’s.
(3) Consolidation process
Subsidiaries are consolidated from the date on which the company obtains their actual control, and are deconsolidated from the date that such control ceases. All significant inter-group balances, investment, transactions and unrealized profits are eliminated in the consolidated financial statements. For subsidiaries being disposed, the operating results and cash flows prior to the date of disposal are included in the consolidated income statement and consolidated cash flow statement; for subsidiaries disposed during the period, the opening balances of the consolidated balance sheet would not be restated. For subsidiaries acquired from a business combination not under common control, their operating results and cash flows subsequent to the acquisition date are included in the consolidated income statement and consolidated cash flow statement, and the opening balances and comparative figures of the consolidated balance sheet would not be restated. For subsidiaries acquired from a business combination under common control, their operating results and cash flows from the date of commencement of the accounting period in which the combination occurred to the date of combination are
included in the consolidated income statement and consolidated cash flow statement, and the comparative figures of the consolidated balance sheet would be restated.
In preparing the consolidated financial statements, where the accounting policies or the accounting periods are inconsistent between the company and subsidiaries, the financial statements of subsidiaries are adjusted in accordance with the accounting policies and accounting period of the company.
Concerning the subsidiary obtained under combination with different control, adjusted several financial statement of the subsidiary based on the fair value of recognizable net assets on purchased day while financial statement consolidation; concerning the subsidiary obtained under combination with same control, considered current status of being control by ultimate controller for consolidation while financial statement consolidation.
The unrealized gains and losses from the internal transactions occurred in the assets the Company sold to the subsidiaries fully offset "the net profit attributable to the owners of the parent company". The unrealized gains and losses from the internal transactions occurred in the assets the subsidiaries sold to the Company are distributed and offset between "the net profit attributable to the owners of the parent company" and "minority interest" according to the distribution ratio of the Company to the subsidiary. The unrealized gains and losses from the internal transactions occurred in the assets sold among the subsidiaries are distributed and offset between "the net profit attributable to the owners of the parent company" and "minority interest" according to the distribution ratio of the Company to the subsidiary of the seller.
The share of thesubsidiary’s ownership interest not attributable to the Company is listed as “minority interest” item under the ownership interest in the consolidated balance sheet. The share of thesubsidiary’s current profit or loss attributable to the minority interests is listed as "minority interest" item under the net profit item in the consolidated income statement. The share of thesubsidiary’s current consolidated income attributable to the minority interests is listed as the “total consolidated income attributable to the minority shareholders” item under the total consolidated income item in the consolidated income statement. If there are minority shareholders, add the "minority interests" item in the consolidated statement of change in equity to reflect the changes of the minority interests. If the losses of the current period shared by asubsidiary’s minority shareholders exceed the share that the minority shareholders hold in the subsidiary ownership interest in the beginning of the period, the balance still charges against the minority interests.
When the control over a subsidiary is ceased due to disposal of a portion of an interest in a subsidiary, the fair value of the remaining equity interest is re-measured on the date when the control ceased. The difference between the sum of the consideration received from disposal of equity interest and the fair value of the remaining equity interest, less the net assets attributable to the company since the acquisition date, is recognized as the investment income from the loss of control. Other comprehensive income relating to original equity investment in subsidiaries shall be treated on the same basis as if the relevant assets or liabilities were disposed of by the acquiree directly when the control is lost, namely be transferred to current investment income other than the relevant part of the movement arising from re-measuring net liabilities or net assets under defined benefit scheme by the original subsidiary. Subsequent measurement of the remaining equity interests shall be in accordance with relevant accounting standards such as “Accounting Standards for business Enterprises 2– Long-term Equity Investments” or “Accounting Standards for business Enterprises 22– Financial Instruments Recognition and Measurement”.
The company shall determine whether loss of control arising from disposal in a series of transactions should be regarded as a bundle of transactions. When the economic effects and terms and conditions of the disposal
transactions met one or more of the following situations, the transactions shall normally be accounted for as a bundle of transactions:①The transactions are entered into after considering the mutual consequences of each individual transaction;② The transactions need to be considered as a whole in order to achieve a deal in commercial sense;③The occurrence of an individual transaction depends on the occurrence of one or more individual transactions in the series;④ The result of an individual transaction is not economical, but it would be economical after taking into account of other transactions in the series. When the transactions are not regarded as a bundle of transactions, the individual transactions shall be accounted as “disposal of a portion of an interest in a subsidiary which does not lead to loss of control” and “disposal of a portion of an interest in a subsidiary which lead to loss of control”. When the transactions are regarded as a bundle of transactions, the transactions shall be accounted as a single disposal transaction; however, the difference between the consideration received from disposal and the share of net assets disposed in each individual transactions before loss of control shall be recognized as other comprehensive income, and reclassified as profit or loss arising from the loss of control when control is lost.
7. Joint arrangement classification and accounting treatment for joint operations
In accordance with theCompany’s rights and obligation under a joint arrangement, the Company classifies joint arrangements into: joint ventures and joint operations.
The company confirms the following items related to the share of interests in its joint operations, and in accordance with the provisions of the relevant accounting standards for accounting treatment:
(1) Recognize the assets held solely by the Company, and recognize assets held jointly by the Company in appropriation to the share of the Company;
(2) Recognize the obligations assumed solely by the Company, and recognize obligations assumed jointly by the Company in appropriation to the share of the Company;
(3) Recognize revenue from disposal of the share of joint operations of the Company;
(4) Recognize fees solely occurred by Company;
(5) Recognize fees from joint operations in appropriation to the share of the Company.
8. Determining standards for cash and cash equivalent
Cash refers to stock cash, savings available for paid at any time; cash and cash equivalent refers to the cash held by the Company with short terms(expired within 3 months since purchased), and liquid and easy to transfer as known amount and investment with minor variation in risks.
9. Foreign currency business and conversion
The occurred foreign currency transactions are converted into the recording currency in accordance with the middle rate of the market exchange rate published by the People's Bank of China on the transaction date. Thereinto, the occurred foreign currency exchange or transactions involved in the foreign currency exchange are converted in accordance with the actual exchange rate in the transactions.
At the balance sheet date, the account balance of the foreign currency monetary assets and liabilities is converted into the recording currency amount in accordance with the middle rate of the market exchange rate published by the People's Bank of China on the transaction date. The balance between the recording currency amount converted
according to exchange rate at the balance sheet date and the original recording currency amount is disposed as the exchange gains or losses. Thereinto, the exchange gains or losses occurred in the foreign currency loans related to the purchase and construction of fixed assets are disposed according to the principle of capitalization of borrowing costs; the exchange gains and losses occurred during the start-up are included in the start-up costs; the rest is included in the current financial expenses.
At the balance sheet date, the foreign currency non-monetary items measured with the historical costs are converted in accordance with the middle rate of the market exchange rate published by the People's Bank of China on the transaction date without changing its original recording currency amount; the foreign currency non-monetary items measured with the fair value are converted in accordance with the middle rate of the market exchange rate published by the People's Bank of China on the fair value date, and the generated exchange gains and losses are included in the current profits and losses as the gains and losses from changes in fair value.
The following displays the methods for translating financial statements involving foreign operations into the statements in RMB: The asset and liability items in the balance sheets for overseas operations are translated at the spot exchange rates on the balance sheet date. Among theowners’ equity items, the items other than “undistributed profits” are translated at the spot exchange rates of the transaction dates. The income and expense items in the income statements of overseas operations are translated at the average exchange rates of the transaction dates. The exchange difference arising from the above mentioned translation are recognized in other comprehensive income and is shown separately underowner’ equity in the balance sheet; such exchange difference will be reclassified to profit or loss in current year when the foreign operation is disposed according to the proportion of disposal.
The cash flows of overseas operations are translated at the average exchange rates on the dates of the cash flows. The effect of exchange rate changes on cash is presented separately in the cash flow statement.
10. Financial instrument
Financial instrument is the contract that taken shape of the financial asses for an enterprise and of the financial liability or equity instrument for other units.
(1) Classification and measurement on financial assets and financial liability
In terms of investment purposes and economic natures, the Company divides its financial assets into financial assets( with its variation of fair value reckoned into current gains/losses), financial assets available for sale, account receivables and held-to-maturity investments, among which, transactional financial asset is measured at fair value and movement of its fair value is recorded in current gains and losses; financial asset available for sale is measured at fair value and movement of its fair value is recorded inowners’ equity; account receivables and held-to-maturity investments are measured at amortized cost.
In terms of economic nature, the Company divides its financial liabilities into two groups, namely financial liabilities at fair value through gains and losses and other financial liabilities at amortized cost.
(2) Determination of fair values for financial assets and financial liabilities
The fair value refers to the price that will be received when selling an asset or the price to be paid to transfer a liability in an orderly transaction between market participants on the date of measurement. Financial instruments exist in an active market. Fair value is determined based on the quoted price in such market. An active market refers to where pricing is easily and regularly obtained from exchanges, brokers, industrial organizations and price fixing service organizations, representing the actual price of a market transaction that takes place in a fair deal. While financial instruments do not exist in an active market, the fair value is determined using valuation techniques. Valuation technologies include reference to be familiar with situation and prices reached in recent market transactions entered into by both willing parties, reference to present fair values of similar other financial instruments, cash flow discounting method and option pricing models.
As for the equity investment of the investee held by the Company, which has no controlling rights, common control or significant influence (that is under the major influence), has no quota in an active market and the fair value cannot be measure reasonably, than divided into financial assets available for sale and measured by cost. (3) Recognition basis and measurement for transfer of financial assets
That the Company grants or delivers financial assets to party other than the issuer of such financial assets equals transfer of financial assets. Financial assets transferred could be the entire or part of such financial assets. Two forms are listed as follows:
① Transfer of right for collecting cash flow of financial assets to another party;
② Transfer financial assets to another party, while the aforementioned right is retained, with obligation of paying such cash flow to final collector
When that the Company has transferred almost all risks and remunerations arising from ownership of all or part financial assets to another party, accordingly, recognition for such entire or part financial assets shall be ceased. Gains and losses are determined by the received consideration less the carrying value of the transferred financial assets. Meanwhile, the original accumulated gains or losses of financial assets recognized in theowners’ equity shall transferred to gains and losses; when all risks and remunerations attached to ownership are retained, recognition for such entire or part financial assets shall continue, and the consideration received shall be viewed as financial liabilities.
As for the financial assets which the Company has neither transferred nor retained all risks and remunerations attached to ownership of such financial assets, while control upon such financial assets still exists, recognition shall be conducted in light of the degree of its continuous involvement in the transferred financial assets. Accordingly, relevant liabilities shall be recognized.
(4) Recognition for termination of financial assets and liability
Upon satisfaction of one of the following condition, financial assets will immediately experience discontinued recognition:
① Right entitled by contract in respect of collection of cash flow from such financial asset terminates.
② Such financial assets have been transferred and meet discontinued recognition condition for financial assets as
regulated by Accounting Standard for Enterprise No.23-Transfer of Financial Assets.
Only when present obligations under financial liability have been released entirely or partly, could cease recognition of such financial liability or part thereof.
(5) Impairment of financial assets
The Company conducts inspection on carrying values of financial assets, except for transactional financial assets, as at balance sheet date. If there is objective evidence indicating that impairment has happened to financial assets, impairment reserve then shall be provided. Financial asset with great amount in single item is subject to separate impairment test. In case of any objective evidence indicating that impairment has happened to such financial asset, impairment loss shall be recognized and recorded in current gains and losses. As for the financial assets with no great amount in single item and those which prove to be not impaired after separate test, the Company will conduct impairment test on basis of credit portfolio which is determined in light ofcustomers’ credit records and historical bad debts, so as to recognize impairment loss.
Objective evidence indicating impairment happens to financial assets means the proceedings meeting the three characteristics: actually occurred subsequent to initial recognition of such financial assets, bring influence over the estimated future cash flow of such financial assets, and such influence could be reliably measured by the Company.
The followings are included in objective evidences indicating impairment happens to financial assets:
① Serious financial difficulty happens to issuer or debtor;
② Breach of terms of contract by debtor, such as breach or overdue in repaying interest or principal;
③ Creditor makes concession for debtors who experience financial trouble in light of consideration for economy or laws;
④ Debtor is very likely to experience bankrupt or financial reorganization;
⑤ Financial assets are not able to be traded in active market since material financial difficulty happens to issuer;⑥ It is unable to judge whether cash flow from certain asset in a group of financial assets has decreased, while it is finally found that the estimated future cash flow of such financial asset has actually decreased since its initial recognition and the decrease can be reliably measured by reference to the general valuation based on open data. For example, payment capacity of debtor of such financial assets portfolio gradually worsens, or unemployment in country or region where the debtor locates risen, price of guaranty falls greatly in the place where it locate, and the industry in which it belongs to is unpromising;
⑦ Material negative changes happen to technologies, markets, economy or law environment in which debtor operates, which leads to that equity instrument investor is not likely to be able to recover investment cost;⑧ Fair value of equity instrument investment experiences severe or non-temporary falling;
⑨ Other objective evidence indicating impairment happens to financial assets.
In the event of impairment in financial asset at amortized cost, impairment loss is calculated based on the difference between carrying value and present value of estimated future cash flow discounted at effective interest
rate.
After impairment loss is recognized for financial asset at amortized cost, if there is objective evidence indicating value of such financial asset has recovered, which is objectively related to proceedings occurred after recognition of such loss, the original impairment loss shall be reversed and recorded in current gains and losses. However, the carrying value subsequent to such reversal shall not exceed the amortized cost of such financial asset as at the reversal date on assumption that such impairment loss had not been provided.
Impairment of available-for-sale financial assets: in the event that decline in fair value of the available-for-sale equity instrument is regarded as “severe decline” or “non-temporary decline” on the basis of comprehensive related factors, it indicates that there is impairment loss of the available-for-sale equity instrument. In particular, “severe decline” refers to fair value is lower than50% of the cost price and last for over one year. “Non-temporary decline” refers to fair value fell for over 6-month sessions.
When the available-for-sale financial assets impair, the accumulated loss originally included in the other comprehensive income arising from the decrease in fair value was transferred out from the capital reserve and included in the profit or loss for the period. The accumulated loss that transferred out from the capital reserve is the balance of the acquired initial cost of asset, after deduction of the principal recovered, amortized amounts, current fair value and the impairment loss originally included in the profit or loss.
After recognition of the impairment loss, if there is objective evidence showing recovery in value of such financial assets impaired and which is related to any event occurring after such recognition in subsequent periods, the impairment loss originally recognized shall be reversed. The impairment loss reversal of the available-for-sale equity instrument will be recognized as other comprehensive income, and the impairment loss reversal of the available-for-sale debt instrument will be included in the profit or loss for the period.
When an equity investment that is not quoted in an active market and the fair value of which cannot be measured reliably, or the impairment loss of a derivative financial asset linked to the equity instrument that shall be settled by delivery of that equity instrument, then it will not be reversed.
11. Account Receivable
(1) Account Receivable withdrawal on single significant amount and with bad debt provision accrued for single item
|||
|-|-|
|Determine basis or amount standards for single|The Company’s account receivables with above RMB 1 million in single item|
|significant amount|is defined as account receivables with significant amount in single item.|
||In line with the difference of present value of future cash flow lower its book|
|Withdrawal method for account with single significant||
||value, carried out impairment test independently and withdrawal the bad debt|
|amount and withdrawal single item bad debt provision||
||reserves|

(2) Receivables with bad debt provision accrual by credit portfolio
|||
|-|-|
|Combination|Bad debt provision accrual|
|Classify to many combination based on credit portfolio for those receivables with minor||
|account singly and those with major amount but has no impairment been found after testing||
||Age analysis method|
|independently; base on the actual loss ratio of the receivables of previous years, with same or||
|similar credit portfolio, and combining actual condition accrual bad debt reserves.||

In combination, accounts whose bad debts provision was accrued by age analysis:
√ Applicable□ Not applicable
||||
|-|-|-|
|Account age|Rate for receivables|Rate for other receivables|
|Within 6 months|||
|6 months to 1 year|10.00%|10.00%|
|1－2 years|20.00%|20.00%|
|2－3 years|40.00%|40.00%|
|Over 3 years|100.00%|100.00%|
|3－4 years|100.00%|100.00%|
|4－5 years|100.00%|100.00%|
|Over 5 years|100.00%|100.00%|

 In combination, withdrawal proportion of bad debt provision based on balance proportion
□ Applicable√ Not applicable
In combination, withdrawal proportion of bad debt provision based on other methods:
□ Applicable√ Not applicable
(3) Account receivable with minor single amount but with withdrawal bad debt provision for single item
|||
|-|-|
|Reasons for withdrawal single item bad|The present value of future cash flow has major difference with the receivable group’s|
|debt provision|present value of future cash flow|
|Withdrawal method for bad debt|Carried out impairment test independently, accrual bad debt reserves according to the|
|provision|difference of present value of future cash flow lower its book value|

12. Inventories
Dose the Company need to comply with disclosure requirements of the special industry
No
(1) Classification of inventories
TheCompany’s inventories are categorized into stock materials, product in process and stock goods etc.
(2) Pricing for delivered inventories
A. Generally, stock materials are calculated at planned cost. Material cost difference is individually set according
to classification of grant types. Pursuant to the difference between the planned cost of the received or delivered raw materials and the material cost the aforesaid cost should share after carrying forward at period-end, the Company adjusts the planned cost to effective cost; finished products are priced at effective costs, and carried forward to operating cost by weighted average method when being delivered;
B. Products in process are priced at effective costs, and carried forward to finished products at actually occurred cost;
C. Finished self-produced products are priced at effective costs, and carried forward to operating cost by weighted average method; external purchase goods (from import and export trades) are carried forward to sales cost by individual pricing method.
(3) Recognition evidence for net realizable value of inventories and withdrawal method for inventory impairment provision
Inventories as at period-end are priced at the lower of costs and net realizable values; at period end, on the basis of overall clearance about inventories, inventory impairment provision is withdrew for uncollectible part of costs of inventories which result from destroy of inventories, out-of-time of all and part inventories, or sales price lowering than cost. Inventory impairment provision for stock goods and quantity of raw materials is subject to the difference between costs of single inventory item over its net realizable value. As for other raw materials with large quantity and comparatively low unit prices, inventory impairment provision is withdrawn pursuant to categories.
As for finished goods, commodities and materials available for direct sales, their net realizable values are determined by their estimated selling prices less estimated sales expenses and relevant taxes. For material inventories held for purpose of production, their net realizable values are determined by the estimated selling prices of finished products less estimated costs, estimated sales expenses and relevant taxes accumulated till completion of production. As for inventories held for implementation of sales contracts or service contracts, their net realizable values are calculated on the basis of contract prices. In the event that inventories held by a company exceed order amount as agreed in sales contracts, net realizable values of the surplus part are calculated on the basis of normal sale price.
(4) Inventory system
Perpetual Inventory System is adopted by the Company and takes a physical inventory.
(5) Amortization of low-value consumables and wrappage
①Low-value consumables
The Company adopts one-off amortization method to amortize the low-value consumables.
②Wrappage
The Company adopts one-off amortization method to amortize the wrappage at the time of receipt.
13. Classified as assets held for sale
The Company classifies non-current assets or disposal groups that meet all of the following conditions as held-for-sale: according to the practice of selling this type of assets or disposal groups in a similar transaction, the non-current assets or disposal group can be sold immediately at its current condition; The sale is likely to occur, that is, the Company has made resolution on the selling plan and obtained definite purchase commitment, the selling is estimated to be completed within one year. Those assets whose disposal is subject to approval from relevant authority or supervisory department under relevant requirements are subject to that approval.
Where the Company loses control over its subsidiary due to disposal of investment in the subsidiary, whether or not the Company retains part equity investment after such disposal, investment in the subsidiary shall be classified in its entirety as held for sale in the separate financial statement of the parent company subject to that the investment in the subsidiary proposed to be disposed satisfies the conditions for being classified as held for sale, and all the assets and liabilities of the subsidiary shall be classified as held for sale in consolidated financial statement.
The purchase commitment identified refers to the legally binding purchase agreement entered into between the Company and other parties, which sets out certain major terms relating to transaction price, time and adequately stringent punishment for default, which render an extremely minor possibility for material adjustment or revocation of the agreement.
Assets held for sale are measured at the lower of heir carrying value and fair value less selling expense. If the carrying value is higher than fair value less selling expense, the excess shall be recognized as impairment loss and recorded in profit or loss for the period, and allowance for impairment shall be provided for in respect of the assets. In respect of impairment loss recognized for disposal group held for sale, carrying value of the goodwill in the disposal group shall be deducted first, and then deduct the carrying value of the non-current assets within the disposal group applicable to this measurement standard on a pro rata basis according to the proportion taken by their carrying value.
If the net amount of fair value of non-current assets held for sale less sales expense on subsequent balance sheet date increases, the amount previously reduced for accounting shall be recovered and reverted from the impairment loss recognized after the asset is classified under the category of held for sale, with the amount reverted recorded in profit or loss for the period. Impairment loss recognized before the asset is classified under the category of held for sale shall not be reverted. If the net amount of fair value of the disposal group held for sale on the subsequent balance sheet date less sales expenses increases, the amount reduced for accounting in previous periods shall be restored, and shall be reverted in the impairment loss recognized in respect of the non-current assets which are applicable to relevant measurement provisions after classification into the category of held for sale, with the reverted amount charged in profit or loss for the current period. The written-off carrying value of goodwill shall not be reverted.
The non-current assets in the non-current assets or disposal group held for sale is not depreciated or amortized, and the debt interests and other fees in the disposal group held for sale continue to be recognized.
If the non-current assets or disposal group are no longer classified as held for sale since they no longer meet the condition of being classified as held for sale or the non-current assets are removed from the disposal group held for sale, they will be measured at the lower of the following:
(I) The amount after their book value before they are classified as held for sale is adjusted based on the depreciation, amortization or impairment that should have been recognized given they are not classified as held for sale;
(II) The recoverable amount.
14. Long-term equity investment
Long-term equity investments refer to long-term equity investments in which the Company has control, joint control or significant influence over the investee. Long-term equity investment without control or joint control or significant influence of the Group is accounted for as available-for-sale financial assets or financial assets measured at fair value with any change in fair value charged to profit or loss.
(1) Determination of initial investment cost
Investment costs of the long-term equity investment are recognized by the follow according to different way of acquirement:
①For a long-term equity investment acquired through a business combination involving enterprises under common control, the initial investment cost of the long-term equity investment shall be the absorbingparty’s share of the carrying amount of theowner’s equity under the consolidated financial statements of the ultimate controlling party on the date of combination. The difference between the initial cost of the long-term equity investment and the cash paid, non-cash assets transferred as well as the book value of the debts borne by the absorbing party shall offset against the capital reserve. If the capital reserve is insufficient to offset, the retained earnings shall be adjusted. If the consideration of the merger is satisfied by issue of equity securities, the initial investment cost of the long-term equity investment shall be the absorbingparty’s share of the carrying amount of theowner’s equity under the consolidated financial statements of the ultimate controlling party on the date of combination. With the total face value of the shares issued as share capital, the difference between the initial cost of the long-term equity investment and total face value of the shares issued shall be used to offset against the capital reserve. If the capital reserve is insufficient to offset, the retained earnings shall be adjusted. (For business combination resulted in an enterprise under common control by acquiring equity of the absorbing party under common control through a stage-up approach with several transactions, these transactions will be judged whether they shall be treat as “transactions in a basket”. If they belong to “transactions in a basket”, these transactions will be accounted for a transaction in obtaining control. If they are not belong to “transactions in a basket”, the initial investment cost of the long-term equity investment shall be the absorbingparty’s share of the carrying amount of theowner’s equity under the consolidated financial statements of the ultimate controlling party on the date of combination. The difference between the initial cost of the long-term equity investment and the aggregate of the carrying amount of the long-term equity investment before merging and the carrying amount the additional consideration paid for further share acquisition on the date of combination shall offset against the capital reserve. If the capital reserve is insufficient to offset, the retained earnings shall be adjusted. Other comprehensive income recognized as a result of the previously held equity investment accounted for using equity method on the date of combination or recognized for available-for-sale financial assets will not be accounted for.)
②For a long-term equity investment acquired through a business combination involving enterprises not under common control, the initial investment cost of the long-term equity investment shall be the cost of combination on the date of acquisition. Cost of combination includes the aggregate fair value of assets paid by the acquirer, liabilities incurred or borne and equity securities issued. (For business combination resulted in an enterprise not
under common control by acquiring equity of the acquire under common control through a stage-up approach with
several transactions, these transactions will be judged whether they shall be treat as “transactions in a basket”. If they belong to “transactions in a basket”, these transactions will be accounted for a transaction in obtaining control. If they are not belong to “transactions in a basket”, the initial investment cost of the long-term equity investment accounted for using cost method shall be the aggregate of the carrying amount of equity investment previously held by the acquire and the additional investment cost. For previously held equity accounted for using equity method, relevant other comprehensive income will not be accounted for. For previously held equity investment classified as available-for-sale financial asset, the difference between its fair value and carrying amount, as well as the accumulated movement in fair value previously included in the other comprehensive income shall be transferred to profit or loss for the current period.) plus the combination cost measured by costs which have directly connection with acquisition are considered as initial investment cost of such long-term equity investment. Realizable assets and liabilities undertaken by such assets (including contingent liabilities) of the party being combined as at the combination date are all measured at fair values, without consideration to amount of minority interests. The surplus of combination cost less fair value net realizable assets of the party being combined is recorded as goodwill, and the deficit is directly recognized in the consolidated statement of gains and losses.
③Long-term investments obtained through other ways:
A. Initial investment cost of long-term equity investment obtained through cash payment is determined according to actual payment for purchase;
B. Initial investment cost of long-term equity investment obtained through issuance of equity securities is determined at fair value of such securities;
C. Initial investment cost of long-term equity investment (exchanged-in) obtained through exchange with non-monetary assets, which is of commercial nature, is determined at fair value of the assets exchanged-out; otherwise determined at carrying value of the assets exchanged-out if it is not of commercial nature;
D. Initial investment cost of long-term equity investment obtained through debt reorganization is determined at fair value of such investment.
(2) Subsequent measurement on long-term equity investment
①Presented controlling ability on investee, the investment shall use cost method for measurement.
②Long-term equity investments with joint control (excluding those constitute joint ventures) or significant influence on the investee are accounted for using equity method.
Under the equity method, where the initial investment cost of a long-term equity investment exceeds theinvestor’s interest in the fair value of theinvestee’s identifiable net assets at the acquisition date, no adjustment shall be made to the initial investment cost. Where the initial investment cost is less than theinvestor’s interest in the fair value of theinvestee’s identifiable net assets at the acquisition date, the difference shall be charged to profit or loss for the current period, and the cost of the long term equity investment shall be adjusted accordingly. Under the equity method, investment gain and other comprehensive income shall be recognized based on theGroup’s share of the net profits or losses and other comprehensive income made by the investee, respectively.
Meanwhile, the carrying amount of long-term equity investment shall be adjusted. The carrying amount of long-term equity investment shall be reduced based on theGroup’s share of profit or cash dividend distributed by the investee. In respect of the other movement of net profit or loss, other comprehensive income and profit distribution of investee, the carrying value of long-term equity investment shall be adjusted and included in the capital reserves. The Group shall recognize its share of theinvestee’s net profits or losses based on the fair values of theinvestee’s individual separately identifiable assets at the time of acquisition, after making appropriate adjustments thereto. In the event of inconformity between the accounting policies and accounting periods of the investee and the Company, the financial statements of the investee shall be adjusted in conformity with the accounting policies and accounting periods of the Company. Investment gain and other comprehensive income shall be recognized accordingly. In respect of the transactions between the Group and its associates and joint ventures in which the assets disposed of or sold are not classified as operation, the share of unrealized gain or loss arising from inter-group transactions shall be eliminated by the portion attributable to the Company. Investment gain shall be recognized accordingly. However, any unrealized loss arising from inter-group transactions between the Group and an investee is not eliminated to the extent that the loss is impairment loss of the transferred assets. In the event that the Group disposed of an asset classified as operation to its joint ventures or associates, which resulted in acquisition of long-term equity investment by the investor without obtaining control, the initial investment cost of additional long-term equity investment shall be the fair value of disposed operation. The difference between initial investment cost and the carrying value of disposed operation will be fully included in profit or loss for the current period. In the event that the Group sold an asset classified as operation to its associates or joint ventures, the difference between the carrying value of consideration received and operation shall be fully included in profit or loss for the current period. In the event that the Company acquired an asset which formed an operation from its associates or joint ventures, relevant transaction shall be accounted for in accordance with “Accounting Standards for Business Enterprises No. 20 “Business combination”. All profit or loss related to the transaction shall be accounted for.
TheGroup’s share of net losses of the investee shall be recognized to the extent that the carrying amount of the long-term equity investment together with any long-term interests that in substance form part of theinvestor’s net investment in the investee are reduced to zero. If the Group has to assume additional obligations, the estimated obligation assumed shall be provided for and charged to the profit or loss as investment loss for the period. Where the investee is making profits in subsequent periods, the Group shall resume recognizing its share of profits after setting off against the share of unrecognized losses.
③Acquisition of minority interest
Upon the preparation of the consolidated financial statements, since acquisition of minority interest increased of long-term equity investment which was compared to fair value of identifiable net assets recognized which are measured based on the continuous measurement since the acquisition date (or combination date) of subsidiaries attributable to the Group calculated according to the proportion of newly acquired shares, the difference of which recognized as adjusted capital surplus, capital surplus insufficient to set off impairment and adjusted retained earnings.
④Disposal of long-term equity investments
In these consolidated financial statements, for disposal of a portion of the long-term equity investments in a subsidiary without loss of control, the difference between disposal cost and disposal of long-term equity investments relative to the net assets of the subsidiary is charged to theowners’ equity. If disposal of a portion of the long-term equity investments in a subsidiary by the parent company results in a change in control, it shall be accounted for in accordance with the relevant accounting policies as described in Note III.- 6 “Preparation Method of the Consolidated Financial Statements”.
On disposal of a long-term equity investment otherwise, the difference between the carrying amount of the investment and the actual consideration paid is recognized through profit or loss in the current period.
In respect of long-term equity investment accounted for using equity method with the remaining equity interest after disposal also accounted for using equity method, other comprehensive income previously underowners’ equity shall be accounted for in accordance with the same accounting treatment for direct disposal of relevant asset or liability by investee on pro rata basis at the time of disposal. Theowners’ equity recognized for the movement of otherowners’ equity (excluding net profit or loss, other comprehensive income and profit distribution of investee) shall be transferred to profit or loss for the current period on pro rata basis.
In respect of long-term equity investment accounted for using cost method with the remaining equity interest after disposal also accounted for cost equity method, other comprehensive income measured and reckoned under equity method or financial instrument before control of the investee unit acquired shall be accounted for in accordance with the same accounting treatment for direct disposal of relevant asset or liability by investee on pro rata basis at the time of disposal and shall be transferred to profit or loss for the current period on pro rata basis; among the net assets of investee unit recognized by equity method (excluding net profit or loss, other comprehensive income and profit distribution of investee) shall be transferred to profit or loss for the current period on pro rata basis.
In the event of loss of control over investee due to partial disposal of equity investment by the Group, in preparing separate financial statements, the remaining equity interest which can apply common control or impose significant influence over the investee after disposal shall be accounted for using equity method. Such remaining equity interest shall be treated as accounting for using equity method since it is obtained and adjustment was made accordingly. For remaining equity interest which cannot apply common control or impose significant influence over the investee after disposal, it shall be accounted for using the recognition and measurement standard of financial instruments. The difference between its fair value and carrying amount as at the date of losing control shall be included in profit or loss for the current period. In respect of other comprehensive income recognized using equity method or the recognition and measurement standard of financial instruments before the Group obtained control over the investee, it shall be accounted for in accordance with the same accounting treatment for direct disposal of relevant asset or liability by investee at the time when the control over investee is lost.
Movement of otherowners’ equity (excluding net profit or loss, other comprehensive income and profit distribution under net asset of investee accounted for and recognized using equity method) shall be transferred to profit or loss for the current period at the time when the control over investee is lost. Of which, for the remaining equity interest after disposal accounted for using equity method, other comprehensive income and otherowners’ equity shall be transferred on pro rata basis. For the remaining equity interest after disposal accounted for using the recognition and measurement standard of financial instruments, other comprehensive income and otherowners’ equity shall be fully transferred.
In the event of loss of common control or significant influence over investee due to partial disposal of equity investment by the Group, the remaining equity interest after disposal shall be accounted for using the recognition and measurement standard of financial instruments. The difference between its fair value and carrying amount as at the date of losing common control or significant influence shall be included in profit or loss for the current period. In respect of other comprehensive income recognized under previous equity investment using equity method, it shall be accounted for in accordance with the same accounting treatment for direct disposal of relevant asset or liability by investee at the time when equity method was ceased to be used. Movement of otherowners’ equity (excluding net profit or loss, other comprehensive income and profit distribution under net asset of investee accounted for and recognized using equity method) shall be transferred to profit or loss for the current period at the time when equity method was ceased to be used.
The Group disposes its equity investment in subsidiary by a stage-up approach with several transactions until the control over the subsidiary is lost. If the said transactions belong to “transactions in a basket”, each transaction shall be accounted for as a single transaction of disposing equity investment of subsidiary and loss of control. The difference between the disposal consideration for each transaction and the carrying amount of the corresponding long-term equity investment of disposed equity interest before loss of control shall initially recognized as other comprehensive income, and subsequently transferred to profit or loss arising from loss of control for the current period upon loss of control.
(3) Impairment test method and withdrawal method for impairment provision
Found more in Note V-20-”impairment of long-term investment”
(4) Criteria of Joint control and significant influence
Joint control is theCompany’s contractually agreed sharing of control over an arrangement, which relevant activities of such arrangement must be decided by unanimously agreement from parties who share control. All the participants or participant group whether have controlling over such arrangement as a group or not shall be judge firstly, than judge that whether the decision-making for such arrangement are agreed unanimity by the participants or not.
Significant influence is the power of the Company to participate in the financial and operating policy decisions of an investee, but to fail to control or joint control the formulation of such policies together with other parties.
While recognizing whether have significant influence by investee, the potential factors of voting power as current convertible bonds and current executable warrant of the investee held by investors and other parties shall be thank over.
15. Investment real estate
Measurement mode
Measured by cost method
Depreciation or amortization method
Investment real estate is stated at cost. During which, the cost of externally purchased properties held-for-investment includes purchasing price, relevant taxes and surcharges and other expenses which are directly attributable to the asset. Cost of self construction of properties held for investment is composed of necessary expenses occurred for constructing those assets to a state expected to be available for use. Properties held for investment by investors are stated at the value agreed in an investment contract or agreement, but those under contract or agreement without fair value are stated at fair value.
The Company adopts cost methodology amid subsequent measurement of properties held for investment, while depreciation and amortization is calculated using the straight-line method according to their estimated useful lives. The basis of provision for impairment of properties held for investment is referred to Note V-20-“Impairment of long-term assets”
16. Fixed assets
(1) Confirmation conditions
Fixed assets refer to the tangible assets for production of products, provision of labor, lease or operation, with a service life excess one year and has more unit value.
(2) Depreciation methods
||||||
|-|-|-|-|-|
|Categories|Method|Years of depreciation|Scrap value rate|Yearly depreciation rate|
|House and Building|Straight-line depreciation|20~35|5|2.71~4.75|
|Machinery equipment|Straight-line depreciation|10|5|9.50|
|Transportation equipment|Straight-line depreciation|4~5|5|19.00~23.75|
|Electronic and other equipment|Straight-line depreciation|3～10|5|9.50～31.67|

As for the fixed assets with impairment accrual, calculated depreciation amount based on the accumulative number of impairment of fixed assets accrual.
(3) Recognization basis, valuation and depreciation method for financial lease assets
The Company affirms those that conform to below one or several criteria as the finance lease fixed assets:
① Agreed in the lease contract (or made a reasonable judgment according to the correlated conditions on the
lease commencement date), the ownership of lease fixed assets can be transferred to the Company after the expiry of the lease period;
② The Company has the option to purchase or lease the fixed assets, and the purchase price is estimated to be much less than the fair value of the lease of fixed assets when exercises the options, so whether the Company will exercise the option can be reasonably determined on the lease commencement date;
③ Even though the fixed asset ownership is not transferred, the lease term accounts for75% of the service life of the lease fixed assets;
④ The present value of theCompany’s of minimum lease payment on the lease commencement date is equivalent to90% or more of the fair value of the lease fixed assets on the lease commencement date; the present value of theleaser’s of minimum lease payment on the lease commencement date is equivalent to90% or more of the fair value of the lease fixed assets on the lease commencement date;
⑤ The leased assets with special properties can only be used by the Company without major modifications. The fixed assets rented by finance leases is calculated as the book value according to the lower one between the fair value of leased assets on the lease commencement date and the present value of the minimum lease payments. (4) The impairment test method of fixed assets and the method of provision for impairment see Note V-20-“Long term asset impairment”.
17. Construction in process
From the date on which the fixed assets built by the Company come into an expected usable state, the projects under construction are converted into fixed assets on the basis of the estimated value of project estimates or pricing or project actual costs, etc. Depreciation is calculated from the next month. Further adjustments are made to the difference of the original value of fixed assets after final accounting is completed upon completion of projects.
The basis of provision for impairment of properties held for construction in process is referred to Note V-20-“Impairment of long-term assets”
18. Borrowing costs
(1) Recognition of capitalization of borrowing costs
Borrowing costs comprise interest occurred, amortization of discounts or premiums, ancillary costs and exchange differences in connection with foreign currency borrowings. The borrowing costs of the Company, which incur from the special borrowings occupied by the fixed assets that need more than one year (including one year) for construction, development of investment properties or inventories or from general borrowings, are capitalized and recorded in relevant assets costs; other borrowing costs are recognized as expenses and recorded in the profit or loss in the period when they are occurred. Relevant borrowing costs start to be capitalized when all of the following three conditions are met:
① Capital expenditure has been occurred;
② Borrowing costs have been occurred;
③ Acquisition or construction necessary for the assets to come into an expected usable state has been carried out.
(2) Period of capitalization of borrowing costs
Borrowing costs arising from purchasing fixed asset, investment real estate and inventory, and occurred after such assets reached to its intended use of status or sales, than reckoned into assets costs while satisfy the above mentioned capitalization condition; capitalization of borrowing costs shall be suspended and recognized as current expenditure during periods in which construction of fixed assets, investment real estate and inventory are interrupted abnormally, when the interruption is for a continuous period of more than 3 months, until the acquisition, construction or production of the qualifying asset is resumed; capitalization shall discontinue when the qualifying asset is ready for its intended use or sale, the borrowing costs occurred subsequently shall reckoned into financial expenses while occurring for the current period.
(3) Measure of capitalization for borrowing cost
In respect of the special borrowings borrowed for acquisition, construction or production and development of the assets qualified for capitalization, the amount of interests expenses of the special borrowings actually occurred in the period less interest income derived from unused borrowings deposited in banks or less investment income derived from provisional investment, are recognized.
With respect to the general borrowings occupied for acquisition, construction or production and development of the assets qualified for capitalization, the capitalized interest amount for general borrowings is calculated and recognized by multiplying a weighted average of the accumulated expenditure on the assets in excess of the expenditure on the some assets of the special borrowings, by a capitalization rate for general borrowings. The capitalization rate is determined by calculation of the weighted average interest rate of the general borrowings. 19. Intangible assets
(1) Measurement, use of life and impairment testing
① Measurement of intangible assets
The intangible assets of the Company including land use rights, patented technology and non-patents technology etc.
The cost of a purchased intangible asset shall be determined by the expenditure actually occurred and other related costs.
The cost of an intangible asset contributed by an investor shall be determined in accordance with the value stipulated in the investment contract or agreement, except where the value stipulated in the contract or agreement is not fair.
The intangible assets acquired through exchange of non-monetary assets, which is commercial in substance, is carried at the fair value of the assets exchanged out; for those not commercial in substance, they are carried at the carrying amount of the assets exchanged out.
The intangible assets acquired through debt reorganization, are recognized at the fair value.
② Amortization methods and time limit for intangible assets:
Land use right of the company had average amortization by the transfer years from the beginning date of transfer (date of getting land use light); Patented technology, non-patented technology and other intangible assets of the Company are amortized evenly with the shortest terms among expected useful life, benefit years regulated in the contract and effective age regulated by the laws. The amortization amount shall count in relevant assets costs and current gains/losses according to the benefit object.
As for the intangible assets as trademark, with uncertain benefit terms, amortization shall not be carried.
Impairment testing methods and accrual for depreciation reserves for the intangible assets found more in Note V-20-“Long-term assets impairment”.
(2) Internal accounting policies relating to research and development expenditures
Expenses incurred during the research phase are recognized as profit or loss in the current period; expenses incurred during the development phase that satisfy the following conditions are recognized as intangible assets (patented technology and non-patents technology):
① It is technically feasible that the intangible asset can be used or sold upon completion;
② there is intention to complete the intangible asset for use or sale;
③ The products produced using the intangible asset has a market or the intangible asset itself has a market;④ there is sufficient support in terms of technology, financial resources and other resources in order to complete the development of the intangible asset, and there is capability to use or sell the intangible asset;
⑤ the expenses attributable to the development phase of the intangible asset can be measured reliably.
If the expenses incurred during the development phase did not qualify the above mentioned conditions, such expenses incurred are accounted for in the profit or loss for the current period. The development expenditure reckoned in gains/losses previously shall not be recognized as assets in later period. The capitalized expenses in development stage listed as development expenditure in balance sheet, and shall be transfer as intangible assets since such item reached its expected conditions for service.
20. Impairment of long-term asset
The Company will judge if there is any indication of impairment as at the balance sheet date in respect of non-current non-financial assets such as fixed assets, construction in progress, intangible assets with a finite useful life, investment properties measured at cost, and long-term equity investments in subsidiaries, joint controlled entities and associates. If there is any evidence indicating that an asset may be impaired, recoverable amount shall be estimated for impairment test. Goodwill, intangible assets with an indefinite useful life and intangible assets beyond working conditions will be tested for impairment annually, regardless of whether there is any indication of impairment.
If the impairment test result shows that the recoverable amount of an asset is less than its carrying amount, the impairment provision will be made according to the difference and recognized as an impairment loss. The recoverable amount of an asset is the higher of its fair value less costs of disposal and the present value of the
future cash flows expected to be derived from the asset. Anasset’s fair value is the price in a sale agreement in anarm’s length transaction. If there is no sale agreement but the asset is traded in an active market, fair value shall be determined based on the bid price. If there is neither sale agreement nor active market for an asset, fair value shall be based on the best available information. Costs of disposal are expenses attributable to disposal of the asset, including legal fee, relevant tax and surcharges, transportation fee and direct expenses incurred to prepare the asset for its intended sale. The present value of the future cash flows expected to be derived from the asset over the course of continued use and final disposal is determined as the amount discounted using an appropriately selected discount rate. Provisions for assets impairment shall be made and recognized for the individual asset. If it is not possible to estimate the recoverable amount of the individual asset, the Group shall determine the recoverable amount of the asset group to which the asset belongs. The asset group is the smallest group of assets capable of generating cash flows independently.
For the purpose of impairment testing, the carrying amount of goodwill presented separately in the financial statements shall be allocated to the asset groups or group of assets benefiting from synergy of business combination. If the recoverable amount is less than the carrying amount, the Group shall recognize an impairment loss. The amount of impairment loss shall first reduce the carrying amount of any goodwill allocated to the asset group or set of asset groups, and then reduce the carrying amount of other assets (other than goodwill) within the asset group or set of asset groups, pro rata on the basis of the carrying amount of each asset.
An impairment loss recognized on the aforesaid assets shall not be reversed in a subsequent period in respect of the restorable value.
21. Long-term Deferred Expenses
Long-term expenses to be amortized of the Company the expenses that are already charged and with the beneficial term of more than one year are evenly amortized over the beneficial term. For the long-term deferred expense items cannot benefit the subsequent accounting periods, the amortized value of such items is all recorded in the profit or loss during recognition.
22. Employee compensation
(1) Accounting treatment for short-term compensation
During the accounting period when the staff providing service to the Company, the short-term remuneration actual occurred shall recognized as liability and reckoned into current gains/losses. During the accounting period when staff providing service to the Company, the actual short-term compensation occurred shall recognized as liabilities and reckoned into current gains/losses, except for those in line with accounting standards or allow to reckoned into capital costs; the welfares occurred shall reckoned into current gains/losses or relevant asses costs while actually occurred. The employee compensation shall recognize as liabilities and reckoned into current gains/losses or relevant assets costs while actually occurred. The employee benefits that belong to non-monetary benefits are
measured in accordance with the fair value; the social insurances including the medical insurance, work-injury
insurance and maternity insurance and the housing fund that the enterprise pays for the employees as well as the labor union expenditure and employee education funds withdrawn by rule should be calculated and determined as the corresponding compensation amount and determined the corresponding liabilities in accordance with the specified withdrawing basis and proportion, and reckoned in the current profits and losses or relevant asset costs in the accounting period that the employees provide services.
(2) Accounting treatment for post-employment benefit
The post-employment benefit included the defined contribution plans and defined benefit plans. Post-employment benefits plan refers to the agreement about the post-employment benefits between the enterprise and employees, or the regulations or measures the enterprise established for providing post-employment benefits to employees. Thereinto, the defined contribution plan refers to the post-employment benefits plan that the enterprisedoesn’t undertake the obligation of payment after depositing the fixed charges to the independent fund; the defined benefit plans refers to post-employment benefits plans except the defined contribution plan.
(3) Accounting for retirement benefits
When the Company terminates the employment relationship with employees before the end of the employment contracts or provides compensation as an offer to encourage employees to accept voluntary redundancy, the Company shall recognize employee compensation liabilities arising from compensation for staff dismissal and included in profit or loss for the current period, when the Company cannot revoke unilaterally compensation for dismissal due to the cancellation of labor relationship plans and employee redundant proposals; and the Company recognize cost and expenses related to payment of compensation for dismissal and restructuring, whichever is earlier. The early retirement plan shall be accounted for in accordance with the accounting principles for compensation for termination of employment. The salaries or wages and the social contributions to be paid for the employees who retire before schedule from the date on which the employees stop rendering services to the scheduled retirement date, shall be recognized (as compensation for termination of employment) in the current profit or loss by the Group if the recognition principles for provisions are satisfied.
(4)Accounting for other long-term employee benefits
Except for the compulsory insurance, the Company provides the supplementary retirement benefits to the employees satisfying some conditions, the supplementary retirement benefits belong to the defined benefit plans, and the defined benefit liability confirmed on the balance sheet is the value by subtracting the fair value of plan assets from the present value of defined benefit obligation. The defined benefit obligation is annually calculated in accordance with the expected accumulated welfare unit method by the independent actuary by adopting the treasury bond rate with similar obligation term and currency. The service charges related to the supplementary retirement benefits (including the service costs of the current period, the previous service costs, and the settlement gains or losses) and the net interest are reckoned in the current profits and losses or other asset costs, the changes generated by recalculating the net liabilities of defined benefit plans or net assets should be reckoned in other consolidated income.
23. Accrued liability
(1) Recognition principle
An obligation related to a contingency, such as guarantees provided to outsiders, pending litigations or arbitrations, product warranties, redundancy plans, onerous contracts, reconstructing, expected disposal of fixed assets, etc. shall be recognized as an estimated liability when all of the following conditions are satisfied:
① the obligation is a present obligation of the Company;
② it is Contingent that an outflow of economic benefits will be required to settle the obligation;
③ the amount of the obligation can be measured reliably.
(2) Measurement method: Measure on the basis of the best estimates of the expenses necessary for paying off the contingencies
24. Revenue
Dose the Company need to comply with disclosure requirements of the special industry
No
(1) Concrete judging criteria for time of recognized
The major risks and remuneration entitled to the ownership of goods are transferred to buyer; neither retains the continued management right generally related to ownership, nor exercise effective control over the sold products; the relevant economic benefits are probable to flow into the Company; the relevant income and costs can be measured reliably.
Concrete judging criteria for time of recognized the income from goods sales:
The Company's domestic sales revenue recognition time: The company delivers goods as agreed, checks the goods that the buyers have received and inspected during the period of the last reconciliation date and this reconciliation date with the buyers on the reconciliation date as agreed, and transfers the risks and remunerations to the buyers after checking, the Company issues the invoices to the buyers in accordance with the recognized varieties, quantities and amounts and affirms the sales revenue realization on the reconciliation date.
The Company's overseas sales revenue recognition time: After checking by the customs, the Company affirms the sales revenue realization according to the date of departure on the customs declaration.
(2) Recognition of revenue of assets using right alienation
Revenue from use by others of enterprise assets shall be recognized only when the associated economic benefit can flow into the Company, and the amount of revenue can be measured reliably, revenue measured by the follow:① Interest income amount: calculated and determined in accordance with the time that others use the enterprises cash and the actual interest rate.
② Royalty revenue amount: calculated and determined in accordance with the charging time and method of the relevant contract or agreement as agreed.
The basis that the Company confirms the revenue from transferring the right to use assets.
Rental income: the revenue realization is confirmed after collecting the rent on the date as agreed in the rental
contract (or agreement). For the rent not received on the date as agreed in the contract or agreement but can be received, and of which the amount of revenue can be measured reliably can also be recognized as revenue. (3) When confirming the incomes of labor services and construction contracts according to the percentage of completion method, determine the basis and method of the contract completion plan.
For the service transaction results can be estimated reliably on the balance sheet date, the service revenue is determined and recognized by adopting the percentage of completion method. The completion progress of service transaction is determined by the proportion of incurred costs in the estimated total cost.
The total service revenue is determined by the received or receivable contract or agreement costs, except that the received or receivable contract or agreement costs are not fair. On the balance sheet date, the service revenue of the current period is determined by multiplying the total service revenue by the completion progress and deducting the amount accumulated in the previous accounting period and confirmed to render the service revenue. Meanwhile, the labor costs of the current period are carried forward by multiplying the total estimated costs of labor services by the completion progress and deducting the amount accumulated in the previous accounting period with confirmed service costs.
For the service transaction results cannot be estimated reliably on the balance sheet date, respectively dispose as following circumstances:
①The incurred labor costs estimated to be compensated are confirmed to render the service revenue according to the incurred labor costs, and are carried forward by the equivalent amount.
②The incurred labor costs estimated not to be compensated are reckoned in the current profits or losses, and are not confirmed to render the service revenue.
25. Government Grants
(1) Determination basis and accounting for government grants related to assets
(1) Types
Government grants are transfer of monetary assets or non-monetary assets from the government to the Group at no consideration. Government grants are classified into government grants related to assets and government grants related to income.
As for the assistance object not well-defined ingovernment’s documents, the classification criteria for assets-related or income-related grants are as: whether the grants turn to long-term assets due to purchasing for construction or other means.
(2) Recognition and measure
The government grants shall be recognized while meet the additional conditions of the grants and amount is actually can be obtained.
If a government grant is in the form of a transfer of monetary asset, the item shall be measured at the amount received or receivable. If a government grant is in the form of a transfer of non-monetary asset, the item shall be measured at fair value. If the fair value can not be reliably acquired, than measured by nominal amount.
(3) Accounting treatment
A government grant related to an asset shall be recognized as deferred income, and reckoned into current gains/losses according to the depreciation process in use life of such assets.
A government grant related to income, if they making up relevant expenses and losses for later period, than recognized deferred income, and should reckoned into current gain/loss during the period while relevant expenses are recognized; if they making up relevant expenses and losses that occurred, than reckoned into current gains/losses.
A government grant related to daily operation activity of the Company should reckoned into other income; those without related to daily operation activity should reckoned into non-operation income and expenses.
The financial discount funds received by the Company shall write down relevant borrowing costs.
(2) Determination basis and accounting for government grants related to income
(1) Types
Government grants are transfer of monetary assets or non-monetary assets from the government to the Group at no consideration. Government grants are classified into government grants related to assets and government grants related to income.
As for the assistance object not well-defined ingovernment’s documents, the classification criteria for assets-related or income-related grants are as: whether the grants turn to long-term assets due to purchasing for construction or other means.
(2) Recognition and measure
The government grants shall be recognized while meet the additional conditions of the grants and amount is actually can be obtained.
If a government grant is in the form of a transfer of monetary asset, the item shall be measured at the amount received or receivable. If a government grant is in the form of a transfer of non-monetary asset, the item shall be measured at fair value. Measured by nominal amount if the fair value can not be reliably acquired.
(3) Accounting treatment
A government grant related to an asset shall be recognized as deferred income, and should be reckoned into current gain/loss according to the depreciation process of the use of such assets life.
A government grant related to an asset shall be recognized as deferred income, and evenly amortized to profit or loss over the useful life of the asset.
A government grant related to daily operation activity of the Company should reckoned into other income; those without related to daily operation activity should reckoned into non-operation income and expenses.
The financial discount funds received by the Company shall write down relevant borrowing costs.
26. Deferred tax assets / deferred income tax liabilities
(1) Deferred income tax assets or deferred income tax liabilities are realized based on the difference between the carrying values of assets and liabilities and their taxation bases (as for the ones did not recognized as assets and liability and with taxation basis recognized in line with tax regulations, different between tax base and its book
value) at the tax rates applicable in the periods when the Company recovers such assets or settles such liabilities. (2) Deferred income tax assets are realized to the extent that it is probable to obtain such taxable income which is used to set off the deductible temporary difference. As at the balance sheet date, if there is obvious evidence showing that it is probable to obtain sufficient taxable income to set off the deductible temporary difference in future periods, deferred income tax assets not realized in previous accounting periods shall be realized.
(3) On balance sheet date, re-review shall be made in respect of the carrying value of deferred income tax assets. If it is impossible to obtain sufficient taxable income to set off the benefits of deferred income tax assets in future periods, then the carrying value of deferred income tax assets shall be reduced accordingly. If it is probable to obtain sufficient taxable income, then the amount reduced shall be switched back.
(4) Current income tax and deferred income tax considered as income tax expenses or incomes reckoned into current gains/losses, excluding the follow income tax:
①Enterprise combination;
②Transactions or events recognized inowner’s equity directly
27. Lease
(1) Accounting for operating lease
The rental fee paid for renting the properties by the company are amortized by the straight-line method and reckoned in the current expenses throughout the lease term without deducting rent-free period. The initial direct costs related to the lease transactions paid by the company are reckoned in the current expenses.
When the lessor undertakes the expenses related to the lease that should be undertaken by the company, the company shall deduct the expenses from the total rental costs, share by the deducted rental costs during the lease term, and reckon in the current expenses.
Rental obtained from assets leasing, during the whole leasing period without rent-free period excluded, shall be amortized by straight-line method and recognized as leasing revenue. The initial direct costs paid with leasing transaction concerned are reckoned into current expenditure; the amount is larger is capitalized when incurred, and accounted for as profit or loss for the current period on the same basis as recognition of rental income over the entire lease period.
When the company undertakes the expenses related to the lease that should be undertaken by the lessor, the company shall deduct the expenses from the total rental income, and distribute by the deducted rental costs during the lease term.
(2) Accounting for financing lease
Assets lease-in by financing: On the beginning date of the lease, the entry value of leased asset shall be at the lower of the fair value of the leased asset and the present value of minimum lease payment at the beginning date of the lease. Minimum lease payment shall be the entry value of long-term accounts payable, with difference recognized as unrecognized financing expenses. Unrecognized financing expenses shall be reckoned in financial expenses and amortized and using effective interest method during the leasing period. The initial direct costs
incurred by the Company shall be reckoned into value of assets lease-in.
Finance leased assets: on the lease commencement date, the company affirms the balance among the finance lease receivables, the sum of unguaranteed residual value and its present value as the unrealized financing income, and recognizes it as the rental income during the period of receiving the rent. For the initial direct costs related to the rental transaction, the company reckons in the initial measurement of the finance lease receivables, and reduces the amount of income confirmed in the lease term.
28. Other important accounting policy and accounting estimation
In the process of applying the Company's accounting policies, due to the inherent uncertainty of business activities, the Company needs to judge, estimate and assume the book value of the report items cannot be accurately measured. These judgments, estimates and assumptions are made on the basis of the historical experience of theCompany’s management and by considering other relevant factors, which shall impact the reported amounts of income, expenses, assets and liabilities and the disclosure of contingent liabilities on the balance sheet date. However, the actual results caused by the estimated uncertainties may differ from the management's current estimates of the Company so as to carry out the significant adjustments to the book value of the assets or liabilities to be affected.
The Company regularly reviews the aforementioned judgments, estimates and assumptions on the basis of continuing operations, the changes in accounting estimates only affect the current period, of which the impacts are recognized in the current period; the changes in accounting estimates not only affect the current period but also the future periods, of which the impacts are recognized in the current and future periods.
On the balance sheet date, the important areas of the financial statements that the Company needs to judge, estimate and assume are as follows:
(1) Provision for bad debts
According to the accounting policies of the accounts receivable, the Company adopts the allowance method to calculate the bad debt losses. The impairment of receivables is based on the assessment to the collectability of the accounts receivable. The impairment of accounts receivable requires themanagement’s judgments and estimates. The actual results and the differences between the previously estimated results shall affect the book value of accounts receivable and the provision or return of thereceivables’ bad debt reserves during the period estimated to be changed.
(2) Inventory impairment
According to the inventory accounting policies, the Company measures by the comparison between the cost and the net realizable value, if the cost is higher than the net realizable value and the old and unsalable inventories, the Company calculates and withdraws the inventory impairment. The inventory devalues to the net realizable value by evaluating theinventory’s vendibility and net realizable value. To identify the inventory impairment, the management needs to obtain the unambiguous evidences, and consider the purpose to hold the inventory, and judge and estimate the impacts of events after the balance sheet date. The actual results and the differences between the previously estimated results shall affect the book value of inventory and the provision or return of the inventory impairment during the period estimated to be changed.
(3) Held-to-maturity investments
The Company classifies the non-derivative financial assets that meet the requirements, have the fixed or ascertainable repayment amount and fixed due date, and that the Company has the positive intention and ability to hold to maturity as the held-to-maturity investment. This classification involves a lot of judgments. In the process of making the judgments, the Company will evaluate its willingness and ability to this held-to-maturity investment. Except in certain cases (such as the investments with insignificant sales amount when the maturity date comes), if the Company fails to hold these investments till the maturity date, then all the investments shall be reclassified to the available-for-sale financial assets which cannot be classified as the held-to-maturity investments in this fiscal year and the next two fiscal years. This kind of case may have a significant impact on the relevant financial assets value listed on the financial statements, and may affect the Company's financial instruments risk management strategy.
(4) Impairment of held-to-maturity investments
The Company determines that the impairment of held-to-maturity investments largely relies on management's judgments. The objective evidences of impairment include that the issuer has serious financial difficulties so that the financial assets cannot continue to be traded in an active market, or cannot be able to fulfill the contract terms (for example, breach the contract of paying the interests or principal), etc. In the process of making the judgments, the Company needs to evaluate the impact of the objective evidence of impairment to the expected future cash flows of the investment.
(5) Impairment of financial assets available for sale
The Company determines that the impairment of held-to-maturity investments largely relies on management's judgments and assumptions so as to determine whether it is needed to affirm its impairment loss in the profit statement. In the process of making the judgments and assumptions, the Company needs to evaluate the extent and duration when the fair value of the investment is less than the cost, as well as the financial situation and short-term business prospects of the investees, including the industry conditions, technological change, credit rating, default rates, and risks of the counterparty.
(6) Preparation for the impairment of non-financial& non-current assets
The Company checks whether the non-current assets except for the financial assets may decrease in value at the balance sheet date. For the intangible assets with indefinite service life, in addition to the annual impairment test, the impairment test is also needed when there is a sign of impairment. For the other non-current assets except for the financial assets, the impairment test is needed when it indicates that the book amounts may not be recoverable. When the book value of the asset or group of assets exceeds its recoverable amount, i.e. the higher between the net amount by subtracting the disposal costs from the fair value and the present value of expected future cash flows, it indicates the impairment.
As for the net amount by subtracting the disposal costs from the fair value, refer to the sales agreement price similar to the assets in the fair trade or the observable market price, and subtract the incremental costs determination directly attributable to the disposal of the asset.
When estimating the present value of the future cash flow, the Company needs to make significant judgments to the output, price, and related operating expenses of the asset (or asset group) and the discount rate used for calculating the present value. When estimating the recoverable amount, the Company shall adopt all the relevant
information can be obtained, including the prediction related to the output, price, and related operating expenses based on the reasonable and supportable assumptions.
The Company tests whether its business reputation decreases in value every year, which requires to estimating the present value of the asset group allocated with goodwill or the future cash flow combined by the asset group. When estimating the present value of the future cash flow, the Company needs to estimate the future cash flows generated by the asset group or the combination of asset group, and select the proper discount rate to determine the present value of the future cash flows.
(7) Depreciation and amortization
The Company depreciates and amortizes the investment property, fixed assets and intangible assets according to the straight-line method in the service life after considering the residual value. The Company regularly reviews the service life to determine the depreciation and amortization expense amount to be reckoned in each reporting period. The service life is determined by the Company based on the past experience of similar assets and the expected technological updating. If the previous estimates have significant changes, the depreciation and amortization expense shall be adjusted in future periods.
(8) Income tax
In theCompany’s normal business activities, the final tax treatment and calculation of some transactions have some uncertainties. Whether some projects can be disbursed from the cost and expenses before taxes requires needs to get approval from the tax authorities. If the final affirmation of these tax matters differs from the initially estimated amount, the difference shall have an impact on its current and deferred income taxes during the final identification period.
(9) Early retirement benefits and supplementary retirement benefits
The expenses of the Company's early retirement benefits and supplementary retirement benefits and the amount of liabilities are determined in accordance with various assumptions. These assumptions include the discount rate, the average growth rate of health care costs, the subsidy growth rate of the early retired personnel and retirees and the other factors. The differences between the actual results and assumptions will be immediately identified and included in the costs of the current year. Although the management thought the reasonable assumptions have been adopted, the changes in the actual experience and assumed conditions will impact the costs and liability balances of the Company's internal early retirement benefits and supplementary retirement benefits.
29. Changes of important accounting policy and estimation
(1) Changes of major accounting policies
□ Applicable√ Not applicable
(2) Changes of important accounting estimate
□ Applicable√ Not applicable
30. Other
Nil
VI. Taxation
1. Major taxes and tax rates
||||
|-|-|-|
|Tax|Basis|Tax rate|
|||Tax rate of 17%/16%, 11%/10%, 6% and 5%, rate for exported commodities is stipulated by|
|VAT|Taxable income|the state with declaration of export tax rebate, rate of tax may be “exempted, credited and|
|||refunded”|
|City maintaining|Turnover tax||
|||7%|
|& construction tax|payable||
|Corporation|||
||Taxable income|25%、15%|
|income tax|||
|Educational surtax|Turnover tax||
|||5%|
||payable||

Disclose reasons for different taxpaying body
|||
|-|-|
|Taxpaying body|Income tax rate|
|Weifu Mashan, Weifu Chang’an, Weifu International Trade, Weifu ITM, Weifu Schmidt, Weifu Leader||
||25%|
|(Wuhan), Weifu Leader (Chongqing), Weifu Leader (Nanchang)||

2. Tax preference
On 17 November 2017, the Company got a “High-Tech Enterprise Certificate” issued jointly by Science& Technology Department of Jiangsu Province, Department of Finance of Jiangsu Province, Jiangsu Provincial Office, SAT and Jiangsu Local Taxation Bureau, certificate No.: GR201732000007. Corporate income tax of the Company shall be taxed by15% in three years since 1 January 2017 in accordance with State regulations. On 27 December 2017, Weifu Jinning got a “High-Tech Enterprise Certificate” issued jointly by Science& Technology Department of Jiangsu Province, Department of Finance of Jiangsu Province, Jiangsu Provincial Office, SAT and Jiangsu Local Taxation Bureau, certificate No.: GR201732004010. Corporate income tax of the Weifu Jinning shall be taxed by15% in three years since 1 January 2017 in accordance with State regulations. On 17 November 2017, Weifu Leader got a “High-Tech Enterprise Certificate” issued jointly by Science& Technology Department of Jiangsu Province, Department of Finance of Jiangsu Province, Jiangsu Provincial Office, SAT and Jiangsu Local Taxation Bureau, certificate No.: GR201732001828. Corporate income tax of the Weifu Jinning shall be taxed by15% in three years since 1 January 2017 in accordance with State regulations.
On 29 November 2017, Weifu Tianli got a “High-Tech Enterprise Certificate” issued jointly by Science&
Technology Bureau of Ningbo, Department of Finance of Ningbo, Ningbo Office, SAT and Ningbo, Zhejiang
Provincial Local Taxation Bureau, certificate No.: GR201733100363. Corporate income tax of the Weifu Tianli
shall be taxed by15% in three years since 1 January 2017 in accordance with State regulations.
On 17 November 2017, Weifu Autocam got a “High-Tech Enterprise Certificate” issued jointly by Science& Technology Department of Jiangsu Province, Department of Finance of Jiangsu Province, Jiangsu Provincial Office, SAT and Jiangsu Local Taxation Bureau, certificate No.: GR201732001043. Corporate income tax of the Weifu Autocam shall be taxed by15% in three years since 1 January 2017 in accordance with State regulations. VII. Notes to major items in consolidated financial statements
1. Monetary capital
In RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Cash on hand|594,764.72|736,773.22|
|Cash in bank|2,941,916,050.54|3,027,702,581.00|
|Other monetary fund|100,198,959.99|90,270,058.61|
|Total|3,042,709,775.25|3,118,709,412.83|

 Other explanation
Separate explanation is required for accounts with restricted application purposes, deposited overseas and of potential recovery risks arising from pledge, mortgage or frozen:
||||
|-|-|-|
|Item|2018-06-30|2017-12-31|
|Bank acceptance bill, L/C and other collateral|99,317,091.42|89,623,690.04|
|Frozen dividend|881,868.57|646,368.57|
|Total|100,198,959.99|90,270,058.61|

Other note:
The frozen dividend of RMB 881,868.57 represents the part of dividends distributed by SDEC Power (stock code: 600841) and Miracle Automation (stock code: 002009) in 2017 and 2018 held by the Company as financial assets available for sale. According to the notices numbered Yue 03MC[2016]2490 and Yue 03MC[2016]2492 served by Guangdong Shenzhen IntermediatePeople’s Court, these dividends were frozen.
2. Note receivables
(1) Classification of notes receivable
In RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Bank acceptance bill|1,605,304,038.52|1,399,006,661.54|
|Commercial acceptance bill|71,633,114.51|65,250,273.29|
|Total|1,676,937,153.03|1,464,256,934.83|

(2) Notes receivable already pledged by the Company at the end of the period
In RMB
|||
|-|-|
|Item|Amount pledge at period-end|
|Bank acceptance bill|389,454,825.85|
|Total|389,454,825.85|

 (3) Notes endorsement or discount and undue on balance sheet date
In RMB
||||
|-|-|-|
|Item|Amount derecognition at period-end|Amount not derecognition at period-end|
|Bank acceptance bill|552,021,420.12||
|Total|552,021,420.12||

(4) Notes transfer to account receivable due for failure implementation by drawer at period-end:
Nil
3. Accounts receivable
(1) Accounts receivable by category:
In RMB
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
||Closing balance|||||Opening balance|||||
||Book balance||Bad debt reserve|||Book balance||Bad debt reserve|||
|Types|||||Book||||||
|||||Accrualratio|||||Accrual|Book value|
||Amount|Ratio|Amount||value|Amount|Ratio|Amount|||
||||||||||ratio||
|Receivables with bad||||0.59%|||||||
|||||||2,006,9|||||
|debt provision|2,389,03||14,082,1||2,374,955|||11,359,20||1,995,577,8|
|||99.93%||||37,035.|99.90%||0.57%||
|accrual by credit|7,510.65||73.32||,337.33|||4.21||30.90|
|||||||11|||||
|portfolio|||||||||||
|Accounts with single|||||||||||
|significant amount|||||||||||
||1,594,67||1,594,67|||1,935,1||1,935,107|||
|and bad debts||0.07%||100.00%|||0.10%||100.00%||
||8.10||8.10|||07.25||.25|||
|provision accrued|||||||||||
|individually|||||||||||
|||||0.66%|2,374,955,337.33|2,008,8||||1,995,577,830.90|
||2,390,63||15,676,8|||||13,294,31|||
|Total||100.00%||||72,142.|100.00%||0.66%||
||2,188.75||51.42|||||1.46|||
|||||||36|||||

Account receivable with single significant amount and withdrawal bad debt provision separately at period end:
□ Applicable√ Not applicable
Account receivable provided for bad debt reserve under aging analysis method in the groups:
√ Applicable□ Not applicable
In RMB
|||||
|-|-|-|-|
||Closing balance|||
|Age||||
||Account receivable|Bad debt reserve|Accrual ratio|
|Sub item of within one year||||
|Within 6 months|2,307,180,116.48|||
|6 months to 1 year|64,424,536.74|6,442,453.69|10.00%|
|Subtotal of within 1 year|2,371,604,653.22|6,442,453.69||
|1-2 years|10,503,584.81|2,100,742.93|20.00%|
|2-3 years|2,317,159.87|926,863.95|40.00%|
|Over 3 years|4,612,112.75|4,612,112.75|100.00%|
|Total|2,389,037,510.65|14,082,173.32|0.59%|

 Explanation on combination determines:
Excluding the account receivable accrual impairment provision separately; based on actual loss ratio of the receivable groups that owes same or similar risk features, which has classify by age in previous years, determine accrual ratio for bad debt provision combine with real condition
In combination, withdrawal proportion of bad debt provision based on balance proportion for account receivable
□ Applicable√ Not applicable
In combination, withdrawal proportion of bad debt provision based on other methods for account receivable:
Nil
(2) Bad debt provision accrual collected or switch back
Bad debt provision accrual was 2,905,380.31 Yuan; the amount collected or switches back amounting to 512,580.00 Yuan.
Important bad debt provision collected or switch back: Nil
The bad-debt provisions transferred back in the current period are mainly the bad-debt provisions counting and drawing at the end of the prior period were withdrawn by means of monetary fund and banknotes in the current period;
(3) Account receivable actual charge off in the period
In RMB
|||
|-|-|
|Item|Amount written off|
|Other small companies|10,260.35|

Major written-off for the major receivable:
Nil
(4) Top 5 receivables at ending balance by arrears party
Total period-end balance of top five receivables by arrears party amounting to 1,282,384,362.70 Yuan, takes 53.64 percent of the total account receivable at period-end, bad debt provision accrual correspondingly at period-end amounting as 3,325,257.94 Yuan.
(5) Account receivable derecognition due to financial assets transfer
Nil
(6) Assets and liabilities resulted by account receivable transfer and continues involvement
Nil
4. Advance payment
(1) Advance payment by age
In RMB
||||||
|-|-|-|-|-|
||Closing balance||Opening balance||
|Age|||||
||Amount|Ratio|Amount|Ratio|
|Within one year|91,326,612.65|91.46%|94,641,350.21|96.99%|
|1-2 years|8,119,187.54|8.13%|2,550,321.91|2.61%|
|2-3 years|291,797.54|0.29%|319,185.79|0.33%|
|Over 3 years|122,524.57|0.12%|65,339.97|0.07%|
|Total|99,860,122.30|--|97,576,197.88|--|

Explanation on reasons of failure to settle on important advance payment with age over one year: Nil
(2) Top 5 advance payment at ending balance by prepayment object
Total period-end balance of top five advance payment by prepayment object amounted to 43,603,202.61 Yuan, takes 43.66 percent of the total advance payment at period-end.
5. Interest receivable
(1) Category
In RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Time deposit|1,480,250.00|2,281,979.17|
|Total|1,480,250.00|2,281,979.17|

(2) Major overdue interest
Nil
6. Dividends payable
(1) Dividends payable
In RMB
||||
|-|-|-|
|Item (or invested unit)|Closing balance|Opening balance|
|RBCD|303,884,540.74||
|Zhonglian Automobile Electronic Co., Ltd.|239,400,000.00||
|Shanghai CD Dengtong Equity Investment|2,985,075.00||
|Total|546,269,615.74||

(2) Important dividends payable with account age over one year
Nil
7. Other accounts receivable
(1) Other accounts receivable by category
In RMB
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
||Closing balance|||||Opening balance|||||
||Book balance||Bad debt provision|||Book balance||Bad debt provision|||
|Category|||||Book||||||
|||||Accrual|||||Accrual|Book value|
||Amount|Ratio|Amount||value|Amount|Ratio|Amount|||
|||||ratio|||||ratio||
|Other account||||||||2,775,552.63|||
|receivable with|||||||||||
|single significant|2,775,55||2,775,55|||2,775,5|||||
|||11.93%||100.00%|||25.60%||100.00%||
|amount and|2.63||2.63|||52.63|||||
|withdrawal bad debt|||||||||||
|provision separately|||||||||||
|Other receivables||||||||2,852,842.79|||
|with bad debt|20,492,4||2,652,60||17,839,88|8,067,4||||5,214,623.4|
|||88.07%||12.94%|||74.40%||35.36%||
|provision accrual by|91.25||6.18||5.07|66.20||||1|
|credit portfolio|||||||||||
||23,268,0||5,428,15||17,839,885.07|10,843,||5,628,395.42||5,214,623.41|
|Total||100.00%||23.33%|||100.00%||51.91%||
||43.88||8.81|||018.83|||||

Other receivable with single significant amount and withdrawal bad debt provision separately at end of period:
√ Applicable□ Not applicable
In RMB
||||||
|-|-|-|-|-|
||Closing balance||||
|Account receivable(units)|||||
||other receivable|Bad debt reserve|Accrual ratio|Reasons|
|American HESS|1,514,671.20|1,514,671.20|100.00%|Bankruptcy|
|Nanjing Jinning Machinery Factory|1,260,881.43|1,260,881.43|100.00%|Un-recyclable|
|Total|2,775,552.63|2,775,552.63|--|--|

In combination, other accounts receivable whose bad debts provision was accrued by age analysis:
√ Applicable□ Not applicable
In RMB
|||||
|-|-|-|-|
||Closing balance|||
|Age||||
||Other accounts receivable|Bad debt provision|Accrual ratio|
|Sub item of within one year||||
|Within 6 months|17,570,796.64|||
|6 months to one year|142,703.03|14,270.30|10.00%|
|Subtotal within one year|17,713,499.67|14,270.30||
|1-2 years|19,594.63|3,918.93|20.00%|
|2-3 years|208,300.00|83,320.00|40.00%|
|Over 3 years|2,551,096.95|2,551,096.95|100.00%|
|Total|20,492,491.25|2,652,606.18|12.94%|

 Explanations on combination determine:
Explanations on combination determine: Excluding the other account receivable accrual impairment provision separately; based on actual loss ratio of the receivable groups that owes same or similar risk features, which has classify by age in previous years, determine accrual ratio for bad debt provision combine with real condition. In combination, withdrawal proportion of bad debt provision based on balance proportion for other account receivable:
□ Applicable√ Not applicable
In combination, withdrawal proportion of bad debt provision based on other methods for other account receivable:
□ Applicable√ Not applicable
(2) Bad debt provision accrual collected or switch back
Bad debt provision accrual was 18,392.08Yuan; the amount collected or switches back amounting to 218,628.69 Yuan.
The major switch back or collected of the bad debt provision in the Period: Nil
The bad-debt provisions transferred back in the current period are mainly the bad-debt provisions counting and drawing at the end of
the prior period were withdrawn by means of banknotes in the current period;
(3) Other receivables actually written-off during the reporting period
Nil
(4) Other receivables by nature
In RMB
||||
|-|-|-|
|Nature|Ending book balance|Opening book balance|
|Intercourse funds receivable from units|13,940,315.41|4,883,788.59|
|Cash deposit|3,534,058.10|3,457,080.65|
|Staff loans and petty cash|5,342,707.17|2,099,504.91|
|Other|450,963.20|402,644.68|
|Total|23,268,043.88|10,843,018.83|

 (5) Top 5 other receivables at ending balance by arrears party
In RMB
|||||||
|-|-|-|-|-|-|
|||||Ratio in total ending||
|||Ending|||Ending balance of|
|Company|Nature||Age|balance of other||
|||balance|||bad bet provision|
|||||receivables||
||Intercourse||Within 6|||
|Baodun (Tianjin) Electrical Co., Ltd.||10,000,000.00||42.98%||
||funds of unit||months|||
|Ningbo Jiangbei High-Tech Industry||||||
||Performance|||||
|Park Development Construction Co.,||1,767,000.00|Over 3 years|7.59%|1,767,000.00|
||bond|||||
|Ltd.||||||
||Advance|||||
||||Specific|||
|American HESS|payment|1,514,671.20||6.51%|1,514,671.20|
||||identification|||
||transfer-in|||||
||Intercourse||Specific|||
|Nanjing Jinning Machinery Factory||1,260,881.43||5.42%|1,260,881.43|
||funds of unit||identification|||
|Nanjing Yinkun Tongchang Assets|Intercourse||Within 6|||
|||883,610.10||3.80%||
|Management Co., Ltd.|funds of unit||months|||
|Total|--|15,426,162.73|--|66.30%|4,542,552.63|

 (6) Account receivables related to government subsidies
Nil
(7) Other receivable for termination of confirmation due to the transfer of financial assets
Nil
(8) The amount of assets and liabilities that are transferred other receivable and continued to be involved Nil
8. Inventory
(1) Inventory classification
In RMB
||||||||
|-|-|-|-|-|-|-|
||Closing balance|||Opening balance|||
|Item||Depreciation|||Depreciation||
||Book balance||Book value|Book balance||Book value|
|||reserve|||reserve||
|Raw materials|440,849,100.13|81,123,527.46|359,725,572.67|444,304,506.71|83,879,268.03|360,425,238.68|
|Goods in process|161,751,574.16|15,483,517.38|146,268,056.78|198,648,407.88|15,483,517.38|183,164,890.50|
|Finished goods|894,902,092.67|159,200,176.74|735,701,915.93|1,098,294,008.21|162,945,096.69|935,348,911.52|
|Total|1,497,502,766.96|255,807,221.58|1,241,695,545.38|1,741,246,922.80|262,307,882.10|1,478,939,040.70|

 (2) Inventory depreciation reserve
In RMB
||||||||
|-|-|-|-|-|-|-|
|||Increase in the current period||Decrease in the current period|||
|Item|Opening balance|||||Closing balance|
|||Accrual|Other|Switch back or write-off|Other||
|Raw materials|83,879,268.03|1,300,000.00||4,055,740.57||81,123,527.46|
|Goods in process|15,483,517.38|||||15,483,517.38|
|Finished goods|162,945,096.69|||3,744,919.95||159,200,176.74|
|Total|262,307,882.10|1,300,000.00||7,800,660.52||255,807,221.58|

① Net realizable value of the inventory refers to: during the day-to-day activities, results of the estimated sale price less costs which are going to happen by estimation till works completed, sales price estimated and relevant taxes.
② Accrual basis for inventory depreciation reserve:
||||
|-|-|-|
|Item|Accrual basis for inventory impairmentprovision|Specific basis for recognization|
|Materials onhand|The materials sold due to finished goodsmanufactured, its net realizable value islower than the book value|Results from the estimated sale price of such inventory less the costwhat will happen, estimated sales expenses and relevant taxes tillthe goods completed|
|Goods in process Tgi|he goods in process sold due to finishedoods manufactured, its net realizable values lower than the book value|Results from the estimated sale price of such inventory less the costwhat will happen, estimated sales expenses and relevant taxes tillthe goods completed|
|Finished goods ib|ts net realizable value is lower than theook value|Results from the estimated sale price less the vary taxes which shallbe taken in process of sales|

③Reasons of switch-back for inventory falling price reserves:
|||
|-|-|
|Item|Reasons of switch-back|
|Materials on hand|The market price for the materials for selling soaring in the Period, thus switch-back in the inventory fallingprice reserves which was accrual|

④Reasons of write-off for inventory falling price reserves:
|||
|-|-|
|Item|Reasons of write-off|
|Materials on hand|Used for production and the finished goods are realized sales|
|Goods in process|Goods in process completed in the Period and corresponding finished goods are realized sales in the Period|
|Finished goods|Sales in the Period|

(3) Explanation on capitalization of borrowing costs at ending balance of inventory
Nil
(4) Assets completed without unsettlement from construction contract at period-end
Nil
9. Other current assets
In RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Entrust financing products|4,549,580,000.00|3,841,320,000.00|
|Receivable export tax rebates|15,440,435.90|14,289,026.22|
|Prepaid taxes and VAT retained|19,725,423.93|25,338,518.05|
|Input tax to be deducted and certification|1,090,087.75|2,568,145.27|
|Other|443,853.15|4,481,600.99|
|Total|4,586,279,800.73|3,887,997,290.53|

 10. Financial assets available for sale
(1) Particular about financial assets available for sale
In RMB
||||||||
|-|-|-|-|-|-|-|
||Closing balance|||Opening balance|||
|Item||Depreciation|||Depreciation||
||Book balance||Book value|Book balance||Book value|
|||reserves|||reserves||
|Instrument equity|||||||
||518,669,466.95|59,433,106.95|459,236,360.00|469,495,975.95|59,433,106.95|410,062,869.00|
|available for sale:|||||||
|Measured by fair|178,332,264.00||178,332,264.00|266,376,600.00||266,376,600.00|

||||||||
|-|-|-|-|-|-|-|
|value|||||||
|Measured by cost|340,337,202.95|59,433,106.95|280,904,096.00|203,119,375.95|59,433,106.95|143,686,269.00|
|Other -- financial|||||||
||20,000,000.00||20,000,000.00|178,080,000.00||178,080,000.00|
|products|||||||
|Total|538,669,466.95|59,433,106.95|479,236,360.00|647,575,975.95|59,433,106.95|588,142,869.00|

 (2) Financial assets available for sale measured by fair value at period-end
In RMB
|||||
|-|-|-|-|
||Instrument equity|Instrument debt||
|Type|||Total|
||available for sale|available for sale||
|Cost /liability of equity instrument/ amortization cost of debt||||
||144,371,235.00||144,371,235.00|
|instrument||||
|Fair value|178,332,264.00||178,332,264.00|
|Amount of fair value changes that accumulatively reckoned in||||
||33,961,029.00||33,961,029.00|
|other comprehensive gains||||

(3) Financial assets available for sale measured by cost at period-end
In RMB
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
||Book balance||||Depreciation reserves||||Ratio of||
||||||||||share-hol|Cash|
|The invested|||||||||||
||Period-begin||||Period-beginni|Incre|Decr||ding in|divid|
|entity||Increased|Decreased|Period-end||||Period-end|||
||ning||||ng|ased|eased||invested|end|
||||||||||entity||
|Guolian|12,000,000.||||||||||
|||||12,000,000.00|||||0.95%||
|Securities|00||||||||||
|Guangxi|||||||||||
||1,600,000.0||||||||||
|Liufa Co.,||||1,600,000.00|1,600,000.00|||1,600,000.00|1.22%||
||0||||||||||
|Ltd.|||||||||||
|Financial|||||||||||
|Company of|||||||||||
|Changchai|800,000.00|||800,000.00|800,000.00|||800,000.00|||
|Group Co.,|||||||||||
|Ltd.|||||||||||
|HEJUN|||||||||||
||33,000,000.||||||||||
|VANGUAR||||33,000,000.00|33,000,000.00|||33,000,000.00|11.72%||
||00||||||||||
|D GROUP|||||||||||
|Nanjing|1,000,000.0|||1,000,000.00|1,000,000.00|||1,000,000.00|1.85%||

|||||||||
|-|-|-|-|-|-|-|-|
|Hengtai|0|||||||
|Insurance||||||||
|and Broker||||||||
|Co., Ltd.||||||||
|Henan||||||||
|Gushi||||||||
|Weining Oil|2,033,106.9|||||||
|||||2,033,106.95|2,033,106.95|2,033,106.95||
|Pump &|5|||||||
|Nozzle Co.,||||||||
|Ltd.||||||||
|Beijing||||||||
|Zhike||||||||
|Industrial||||||||
||86,940,000.|||||||
|Investment||||86,940,000.00|11,000,000.00|11,000,000.00|12.66%|
||00|||||||
|Holding||||||||
|Group Co.,||||||||
|Ltd.(Note)||||||||
|Wuxi||||||||
|Xidong||||||||
|Technologic|5,000,000.0|||||||
|||||5,000,000.00|||1.43%|
|al Industry|0|||||||
|Park Co.,||||||||
|Ltd.||||||||
|Shanghai||||||||
|IMS||||||||
|Automotive|10,000,000.|||||||
|||||10,000,000.00|10,000,000.00|10,000,000.00|12.27%|
|Electronic|00|||||||
|System Co.,||||||||
|Ltd.||||||||
|Shanghai||||||||
|CD||||||||
|Dengtong|50,746,269.|||||||
||||14,925,373.00|35,820,896.00|||14.93%|
|Equity|00|||||||
|Investment||||||||
|Fund||||||||
|Protean||||||||
|||152,143,2||||||
|Holdings||||152,143,200.00||||
|||00.00||||||
|Corp.||||||||
||203,119,375.|152,143,2||||||
|Total|||14,925,373.00|340,337,202.95|59,433,106.95|59,433,106.95|--|
||95|00.00||||||

The
15th
meeting of the eighth board of directors of the company reviewed and approved the Proposal on Foreign
Investment. The company will invest 30 million US dollars in the E-round preferred stock issued by Protean and the two parties will establish a Sino-foreign joint venture in China. According to the investment cooperation agreement, the company paid the initial investment of 24 million US dollars on May 21, 2018. The company obtained the equity certificate of subscribing 10,212,765 shares of E-round preferred stock issued by Protean and became a shareholder of the Protean E-round preferred stock with the equity certificate number of Number E-1. (4) Changes of impairment in Period
In RMB
|||||
|-|-|-|-|
||Instrument equity|Instrument debt||
|Type|||Total|
||available for sale|available for sale||
|Balance of impairment accrual at period-begin|59,433,106.95||59,433,106.95|
|Balance of impairment accrual at period-end|59,433,106.95||59,433,106.95|

 (5) Where the fair value of equity instruments available for sale drops significantly or not contemporarily at period-end, without impairment provision is made
Nil
11. Long-term equity investment
In RMB
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
|||+,-||||||||||
||||||||||||Endin|
||||Capitalreduction||Other|||||||
||||||||||||g|
|||Add|||compr|||||||
|||||||Other|||||balan|
|||itio|||ehensi|||Impai||||
|The invested||||Investment gains||equit|Cash dividend or||||ce of|
||Opening balance|nal|||ve|||rment|Oth|Closing balance||
|entity||||recognized under||y|profit announced||||impai|
|||inve|||incom|||accru|er|||
|||||equity||chan|to issued||||rment|
|||stm|||e|||al||||
|||||||ge|||||provi|
|||ent|||adjust|||||||
||||||||||||sion|
||||||ment|||||||
|I. Joint venture||||||||||||
|Wuxi Weifu||||||||||||
|Environment||||||||||||
|Protection|522,882,789.26|||42,852,567.41||||||565,735,356.67||
|Catalyst Co.,||||||||||||
|Ltd.||||||||||||
|Subtotal|522,882,789.26|||42,852,567.41||||||565,735,356.67||
|II. Associated enterprise||||||||||||
|RBCD|2,608,796,934.00|||706,611,723.39|||607,769,081.48|||2,707,639,575.91||
|Zhonglian|959,036,193.36|||211,952,191.28|||239,400,000.00|||931,588,384.64||

||||||
|-|-|-|-|-|
|Automobile|||||
|Electronic Co.,|||||
|Ltd.|||||
|Weifu Precision|||||
|Machinery|||||
||49,348,908.96|6,943,964.90||56,292,873.86|
|Manufacturing|||||
|Co., Ltd.|||||
|Subtotal|3,617,182,036.32|925,507,879.57|847,169,081.48|3,695,520,834.41|
|Total|4,140,064,825.58|968,360,446.98|847,169,081.48|4,261,256,191.08|

 12. Investment real estate
(1) Investment real estate measured at cost
√ Applicable□ Not applicable
In RMB
||||||
|-|-|-|-|-|
||||Construction||
|Item|House and building|Land use right||Total|
||||in process||
|I. Original book value|||||
|1.Opening balance|63,545,325.48|||63,545,325.48|
|2. Increased in the period|||||
|(1) Outsourcing|||||
|(2) Inventory\fixed assets\construction in process|||||
|transfer-in|||||
|(3) Increased by combination|||||
|3. Decreased in the period|||||
|(1) Disposal|||||
|(2) Other transfer-out|||||
|4.Closing balance|63,545,325.48|||63,545,325.48|
|II. Accumulated depreciation and accumulated amortization|||||
|1.Opening balance|40,000,494.70|||40,000,494.70|
|2. Increased in the period|783,301.87|||783,301.87|
|(1) Accrual or amortization|783,301.87|||783,301.87|
|3. Decreased in the period|||||
|(1) Disposal|||||
|(2) Other transfer-out|||||
|4.Closing balance|40,783,796.57|||40,783,796.57|

||||
|-|-|-|
|III. Depreciation reserves|||
|1.Opening balance|||
|2. Increased in the period|||
|(1) Accrual|||
|3. Decreased in the period|||
|(1) Disposal|||
|(2) Other transfer-out|||
|4.Closing balance|||
|IV. Book value|||
|1. Ending Book value|22,761,528.91|22,761,528.91|
|2. Opening Book value|23,544,830.78|23,544,830.78|

 (2) Investment real estate measured at fair value
□ Applicable√ Not applicable
(3) Investment real estate without property certification held
Nil
13. Fixed assets
(1) Fixed assets
In RMB
|||||||
|-|-|-|-|-|-|
|||Machinery|Transportation|Electronic and||
|Item|Housing buildings||||Total|
|||equipment|equipment|other equipment||
|I. Original book value||||||
|1.Opening balance|1,537,881,197.20|2,214,135,391.61|40,678,767.59|423,482,779.18|4,216,178,135.58|
|2. Increased in the period|13,805,750.48|122,279,067.31|2,666,200.95|53,131,026.10|191,882,044.84|
|(1) Purchase||17,920,740.54|208,172.41|3,737,953.77|21,866,866.72|
|(2) Construction in process||||||
||13,805,750.48|104,358,326.77|2,458,028.54|49,393,072.33|170,015,178.12|
|transfer-in||||||
|(3) Increased by||||||
|combination||||||
|3. Decreased in the Period||15,081,226.35|7,279,444.18|10,203,624.37|32,564,294.90|
|(1) Disposal or scrapping||15,081,226.35|7,279,444.18|10,203,624.37|32,564,294.90|
|4.Closing balance|1,551,686,947.68|2,321,333,232.57|36,065,524.36|466,410,180.91|4,375,495,885.52|

|||||||
|-|-|-|-|-|-|
|II. Accumulated depreciation||||||
|1.Opening balance|283,668,171.81|1,077,183,649.52|29,697,332.26|185,833,218.62|1,576,382,372.21|
|2. Increased in the period|25,793,559.46|84,971,976.30|1,517,629.56|29,730,334.80|142,013,500.12|
|(1) Accrual|25,793,559.46|84,971,976.30|1,517,629.56|29,730,334.80|142,013,500.12|
|3. Decreased in the Period||14,791,563.81|6,421,864.04|1,632,480.02|22,845,907.87|
|(1) Disposal or scrapping||14,791,563.81|6,421,864.04|1,632,480.02|22,845,907.87|
|4.Closing balance|309,461,731.27|1,147,364,062.01|24,793,097.78|213,931,073.40|1,695,549,964.46|
|III. Depreciation reserves||||||
|1.Opening balance||48,038,049.98|73,320.38|6,811,764.47|54,923,134.83|
|2. Increased in the period||||||
|(1) Accrual||||||
|3. Decreased in the Period||534,612.88|0.48|0.64|534,614.00|
|(1) Disposal or scrapping||534,612.88|0.48|0.64|534,614.00|
|4.Closing balance||47,503,437.10|73,319.90|6,811,763.83|54,388,520.83|
|IV. Book value||||||
|1. Ending Book value|1,242,225,216.41|1,126,465,733.46|11,199,106.68|245,667,343.68|2,625,557,400.23|
|2. Opening Book value|1,254,213,025.39|1,088,913,692.11|10,908,114.95|230,837,796.09|2,584,872,628.54|

 (2) Temporarily idle fixed assets
Nil
(3) Fixed assets acquired by financing lease
Nil
(4) Fixed assets acquired by operating lease
Nil
(5) Certificate of title un-completed
In RMB
||||
|-|-|-|
|Item|Book value|Reasons|
|Boiler room and guard house of Weifu Jinning|2,876,014.42|Still in process of relevant property procedures|
|Plant and office building of Weifu Chang’an|44,885,378.07|Still in process of relevant property procedures|

14. Construction in progress
(1) Construction in progress
In RMB
||||||||
|-|-|-|-|-|-|-|
||Closing balance|||Opening balance|||
|Item||Depreciation|||Depreciation||
||Book balance||Book value|Book balance||Book value|
|||reserves|||reserves||
|2nd Phase construction project|||||||
||3,530,380.40||3,530,380.40|3,364,768.05||3,364,768.05|
|in industrial park|||||||
|Weifu Tianli Technical|||||||
||18,086,324.59||18,086,324.59|16,518,417.24||16,518,417.24|
|Transformation Project|||||||
|Technical|||||||
|transformation of parent|51,456,827.21|1,470,033.00|49,986,794.21|23,611,775.63|1,470,033.00|22,141,742.63|
|company|||||||
|Technical|||||||
|transformation of Weifu|84,307,233.92||84,307,233.92|32,705,249.53||32,705,249.53|
|Autocam|||||||
|Other project|41,794,711.58|2,096,342.62|39,698,368.96|27,711,626.45|2,096,342.62|25,615,283.83|
|Total|199,175,477.70|3,566,375.62|195,609,102.08|103,911,836.90|3,566,375.62|100,345,461.28|

 (2) Changes of major projects under construction
In RMB
||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|
||||increased in thePeriod||||||Acc||||
||||||||||umu|includi|Inter||
||||||||Propor||lated|ng:|est||
||||||||tion of||amo|interes|capit||
|||||||||Pr||||Sour|
||Bu|||Fixed assets|Other||project||unt|t|aliza||
|||Opening||||Closing||og||||ce of|
|Item|dg|||transfer-in in|decreased in||invest||of|capital|tion||
|||balance||||balance||res||||fund|
||et|||the Period|the Period||ment||inter|ized|rate||
|||||||||s||||s|
||||||||in||est|amoun|of||
||||||||budget||capit|t of the|the||
||||||||||aliza|year|year||
||||||||||tion||||
|2nd Phase|||||||||||||
|constructi|||||||||||||
|on project||||||||||||Oth|
|||3,364,768.05|7,282,775.95|7,117,163.60||3,530,380.40|||||||
|in||||||||||||er|
|industrial|||||||||||||
|park|||||||||||||

|||||||||
|-|-|-|-|-|-|-|-|
|Weifu||||||||
|Tianli||||||||
|Technical|||||||Oth|
||16,518,417.24|1,567,907.35||18,086,324.5|9|||
|Transform|||||||er|
|ation||||||||
|Project||||||||
|Technical||||||||
|transforma||||||||
||||||||Oth|
|tion of|23,611,775.63|90,442,603.61|62,597,552.03|51,456,827.2|1|||
||||||||er|
|parent||||||||
|company||||||||
|Technical||||||||
|transforma||||||||
||||||||Oth|
|tion of|32,705,249.53|88,909,818.12|37,307,833.73|84,307,233.9|2|||
||||||||er|
|Weifu||||||||
|Autocam||||||||
|||||157,380,766.|1--2|||
|Total|76,200,210.45|188,203,105.03|107,022,549.36|||--|--|

(3) The provision for impairment of construction projects
Nil
15. Intangible assets
(1) Particular about intangible assets
In RMB
||||||||
|-|-|-|-|-|-|-|
||||Non-patent|Trademark and|Computer||
|Item|Land use right|Patent||||Total|
||||technology|trademark license|software||
|I. Original book value|||||||
|1.Opening balance|382,073,520.00||3,539,793.05|41,597,126.47|51,218,449.46|478,428,888.98|
|2. Increased in the period|||||1,181,977.78|1,181,977.78|
|(1) Purchase|||||1,181,977.78|1,181,977.78|
|(2) Internal R&D|||||||
|(3) Increased by combination|||||||
|3. Decreased in the period|||||||
|(1) Disposal|||||||
|4.Closing balance|382,073,520.00||3,539,793.05|41,597,126.47|52,400,427.24|479,610,866.76|
|II. Accumulated amortization|||||||

|||||||
|-|-|-|-|-|-|
|1.Opening balance|70,825,229.06|2,271,368.77|9,709,000.00|38,344,247.79|121,149,845.62|
|2. Increased in the period|4,190,708.88|176,989.86||4,559,690.41|8,927,389.15|
|(1) Accrual|4,190,708.88|176,989.86||4,559,690.41|8,927,389.15|
|3. Decreased in the period||||||
|(1) Disposal||||||
|4.Closing balance|75,015,937.94|2,448,358.63|9,709,000.00|42,903,938.20|130,077,234.77|
|III. Impairment provision||||||
|1.Opening balance|||16,646,900.00||16,646,900.00|
|2. Increased in the period||||||
|(1) Accrual||||||
|3. Decreased in the period||||||
|(1) Disposal||||||
|4.Closing balance|||16,646,900.00||16,646,900.00|
|IV. Book value||||||
|1. Ending Book value|307,057,582.06|1,091,434.42|15,241,226.47|9,496,489.04|332,886,731.99|
|2. Opening Book value|311,248,290.94|1,268,424.28|15,241,226.47|12,874,201.67|340,632,143.36|

 Ratio of the intangible assets from internalR&D in balance of intangible assets at period-end was0%.
(2) Land use rights without certificate of ownership
Nil
16. Goodwill
(1) Original book value of goodwill
In RMB
||||||
|-|-|-|-|-|
|The invested entity or items|Opening balance|Increase during the period|Decreased during the period|Closing balance|
|Weifu Tianli|1,784,086.79|||1,784,086.79|
|Total|1,784,086.79|||1,784,086.79|

 (2) Goodwill depreciation reserves
Nil
Other note
Goodwill of the Weifu Tianli: the Company controlling and combine Weifu Tianli by increasing the capital, the
goodwill is the number that combination cost greater than the fair value of identical net assets of Weifu Tianli
17. Long-term unamortized expenses
In RMB
|||||||
|-|-|-|-|-|-|
|Item|Opening balance|increased in the Period|Amortized in the Period|Other decrease|Closing balance|
|Remodeling costs etc.|2,969,770.81|6,075,566.34|1,093,846.42||7,951,490.73|
|Total|2,969,770.81|6,075,566.34|1,093,846.42||7,951,490.73|

 18. Deferred income tax assets and deferred income tax liabilities
(1) Deferred income tax assets un-offset
In RMB
||||||
|-|-|-|-|-|
||Closing balance||Opening balance||
|Item|Deductible temporary|Deferred income|Deductible temporary|Deferred income|
||difference|tax assets|difference|tax assets|
|Bad debt reserves|20,748,735.98|3,154,735.07|18,591,825.81|2,834,842.52|
|Inventory falling price reserves|234,020,244.05|36,250,953.16|240,520,904.57|37,599,678.75|
|Fixed assets depreciation reserves|20,198,782.12|3,246,011.41|20,459,349.51|3,285,096.52|
|Construction in process depreciation|||||
||3,566,375.62|534,956.34|3,566,375.62|534,956.34|
|reserves|||||
|Intangible assets depreciation reserves|16,646,900.00|2,497,035.00|16,646,900.00|2,497,035.00|
|Financial assets available for sale|||||
||10,000,000.00|1,500,000.00|10,000,000.00|1,500,000.00|
|depreciation reserves|||||
|Deferred income|436,541,555.15|65,499,039.14|447,676,720.31|67,151,508.04|
|Internal un-realized profit|29,144,718.41|5,398,961.55|28,149,575.30|4,972,350.93|
|Payable salary, accrued expenses etc.|531,770,116.00|81,259,345.81|526,642,684.53|81,166,909.39|
|Depreciation assets, amortization|||||
||16,162,648.59|3,032,645.55|9,768,298.31|1,465,244.74|
|difference|||||
|Total|1,318,800,075.92|202,373,683.03|1,322,022,633.96|203,007,622.23|

 (2) Deferred income tax liabilities un-offset
In RMB
||||||
|-|-|-|-|-|
||Closing balance||Opening balance||
|Item|Taxable temporary|Deferred income tax|Taxable temporary|Deferred income tax|
||differences|liabilities|differences|liabilities|
|Asset evaluation increment for|||||
||13,121,739.54|1,968,260.9|2 13,491,849.42|2,023,777.40|
|combination not under the same control|||||

||||||
|-|-|-|-|-|
|Change of fair value for the financial|||||
||33,961,029.00|5,094,154.34|102,552,300.00|15,382,844.99|
|assets available for sale|||||
|Total|47,082,768.54|7,062,415.26|116,044,149.42|17,406,622.39|

 (3) Deferred income tax assets and deferred income tax liabilities listed after off-set
In RMB
||||||
|-|-|-|-|-|
||Trade-off between the|Ending balance of|Trade-off between the|Opening balance of|
|Item|deferred income tax|deferred income tax assets|deferred income tax assets and|deferred income tax assets|
||assets and liabilities|or liabilities after off-set|liabilities at period-begin|or liabilities after off-set|
|Deferred income tax||202,373,683.03||203,007,622.23|
|assets|||||
|Deferred income tax||7,062,415.26||17,406,622.39|
|liabilities|||||

(4) Details of unrecognized deferred income tax assets
In RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Bad debt reserves|356,274.25|330,881.07|
|Inventory falling price reserves|21,786,977.53|21,786,977.53|
|Loss of subsidiary of Weifu ITM etc.|145,170,897.49|160,376,822.42|
|Fixed assets depreciation reserves|34,189,738.71|34,463,785.32|
|Provision for impairment of financial assets available for sale|49,433,106.95|49,433,106.95|
|Total|250,936,994.93|266,391,573.29|

 (5) Deductible losses of un-recognized deferred income tax assets expired on the followed year
In RMB
|||||
|-|-|-|-|
|Year|Ending amount|Opening amount|Note|
|2018|5,322,336.59|23,365,456.08|Weifu ITM and other subsidiaries have operating losses|
|2019|35,159,237.40|35,159,237.40|Weifu ITM and other subsidiaries have operating losses|
|2020|44,811,748.35|44,811,748.35|Weifu ITM and other subsidiaries have operating losses|
|2021|46,080,956.48|46,080,956.48|Weifu ITM and other subsidiaries have operating losses|
|2022|10,959,424.11|10,959,424.11|Weifu Mashan and other subsidiaries have operating losses|
||||Weifu Leader (Wuhan) and Weifu Leader (Nanchang) have|
|2023|2,837,194.56|||
||||operating losses|
|Total|145,170,897.49|160,376,822.42|--|

19. Other non-current assets
In RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Engineering equipment paid in advance|203,344,783.19|195,088,675.74|
|Total|203,344,783.19|195,088,675.74|

 20. Short-term loans
(1) Types of short-term loans
In RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Debt of honor|359,000,000.00|243,000,000.00|
|Total|359,000,000.00|243,000,000.00|

 Note for types of short-term loans: Nil
(2) Overdue short-term loans without payment
Nil
21. Notes payable
In RMB
||||
|-|-|-|
|Type|Closing balance|Opening balance|
|Bank acceptance|1,086,240,637.65|947,976,759.10|
|Total|1,086,240,637.65|947,976,759.10|

 Notes expired at period-end without paid was 0.00 Yuan.
22. Account payable
(1) Account payable
In RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Within 1 year|2,443,885,021.54|2,452,140,381.86|
|1-2 years|74,618,775.30|43,524,905.85|
|2-3 years|4,528,284.50|2,318,008.01|
|Over 3 years|73,935,972.62|72,972,910.11|

||||
|-|-|-|
|Total|2,596,968,053.96|2,570,956,205.83|

 (2) Important account payable with account age over one year
Nil
23. Account received in advance
(1) Account received in advance
In RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Within 1 year|32,550,368.42|34,272,416.20|
|1-2 years|4,880,699.28|7,271,092.26|
|2-3 years|478,964.54|346,383.11|
|Over 3 years|834,094.66|930,344.50|
|Total|38,744,126.90|42,820,236.07|

 (2) Important account received in advance with account age over one year
Nil
(3) Project settled without completed from construction contract at end of the period
Nil
24. Wages payable
(1) Wages payable
In RMB
||||||
|-|-|-|-|-|
|||Increase during|Decreased during|Closing|
|Item|Opening balance||||
|||the period|the period|balance|
|I. Short-term compensation|147,444,265.93|552,717,728.57|551,598,001.98|148,563,992.52|
|II. Post-employment welfare- defined contribution plans|34,299,401.90|75,365,636.13|86,492,467.45|23,172,570.58|
|III. Dismissed welfare|3,397,642.16||2,534,994.78|862,647.38|
|IV. Other welfare due within one year|121,670,000.00||41,525,853.95|80,144,146.05|
|V. Other short-term welfare-Housing subsidies,|||||
||20,967,367.30|75,247.00|1,001,395.68|20,041,218.62|
|employee benefits and welfare funds|||||
|Total|327,778,677.29|628,158,611.70|683,152,713.84|272,784,575.15|

(2) Short-term compensation
In RMB
||||||
|-|-|-|-|-|
|Item|Opening balance|Increase during the period|Decreased during the period|Closing balance|
|1. Wages , bonuses, allowances and subsidies|128,145,458.85|444,358,686.59|442,039,905.59|130,464,239.85|
|2. Welfare for workers and staff|0.00|36,510,439.50|36,510,439.50|0.00|
|3. Social insurance|8,642,880.67|34,717,154.89|36,349,752.03|7,010,283.53|
|Including: Medical insurance|6,749,035.02|27,589,802.57|28,777,883.18|5,560,954.41|
|Work injury insurance|1,221,106.56|4,482,888.57|4,694,772.55|1,009,222.58|
|Maternity insurance|672,739.09|2,644,463.75|2,877,096.30|440,106.54|
|4. Housing accumulation fund|1,062,011.00|30,258,592.00|30,667,173.00|653,430.00|
|5. Labor union expenditure and|||||
||9,593,915.41|6,872,855.59|6,030,731.86|10,436,039.14|
|personnel education expense|||||
|Total|147,444,265.93|552,717,728.57|551,598,001.98|148,563,992.52|

 (3) Defined contribution plans
In RMB
||||||
|-|-|-|-|-|
|Item|Opening balance|Increase during the period|Decreased during the period|Item|
|1. Basic endowment insurance|17,818,243.64|63,188,840.92|67,471,461.20|13,535,623.36|
|2. Unemployment insurance|1,664,483.26|1,600,662.13|1,622,429.76|1,642,715.63|
|3. Enterprise annuity|14,816,675.00|10,576,133.08|17,398,576.49|7,994,231.59|
|Total|34,299,401.90|75,365,636.13|86,492,467.45|23,172,570.58|

 Other explanation:
1. Post-employment welfare- defined contribution plans: The Company participates in the pension insurance and unemployment insurance plans established by government authorities by laws. Under these plans, the Company makes monthly contribution to these plans based on19% and0.5% of the social insurance contribution base for 2017 respectively. Other than the aforesaid monthly contribution, the Company takes no further payment obligation. The relevant expenditure is included in current profit or loss or cost of relevant assets when occurs. Found more of enterprise annuity in Note XVI-4.” Annuity plan”
2. Dismiss welfare: The wages payable resulted from the implementation of inner retirement plan.
25. Tax payable
In RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Value-added tax|35,720,771.51|26,675,795.24|

||||
|-|-|-|
|Enterprise income tax|48,507,346.26|53,333,508.69|
|Individual income tax|948,422.26|3,102,645.73|
|Urban maintenance and construction tax|2,089,045.74|1,873,973.56|
|Educational surtax|1,492,175.51|1,338,552.54|
|Other (including stamp tax and local funds)|5,681,257.06|7,545,214.60|
|Total|94,439,018.34|93,869,690.36|

 26. Interest payable
In RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Long-term borrowing interest for installment|90,972.22|79,826.39|
|Interest payable for short-term loans|464,037.50|322,102.04|
|Total|555,009.72|401,928.43|

 Major overdue interest: Nil
27. Dividends payable
In RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Common stock dividends|1,210,740,700.00||
|Total|1,210,740,700.00||

Other explanation, including important dividend payables without payment over one year, and explained u-payment reasons: Nil
28. Other payable
(1) Classification of other payable according to nature of account
In RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Deposit and margin|20,194,038.96|20,977,476.26|
|Social insurance and reserves funds that withholding|7,139,777.20|7,689,385.68|
|Intercourse funds of units|31,165,472.64|25,754,545.98|
|Other|6,857,374.07|8,516,532.98|
|Total|65,356,662.87|62,937,940.90|

(2) Significant other payable with over one year age
In RMB
||||
|-|-|-|
|Item|Closing balance|Reasons of un-paid or carry-over|
|Nanjing Jidian Industrial Group Co., Ltd.|4,500,000.00|Intercourse funds|
|Total|4,500,000.00|--|

29. Noncurrent liabilities due within one year
In RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Long-term loans due within one year|5,000,000.00|10,000,000.00|
|Total|5,000,000.00|10,000,000.00|

 30. Long-term loans
(1) Classification of long-term loans
In RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Guaranteed loan|45,000,000.00|45,000,000.00|
|Total|45,000,000.00|45,000,000.00|

 Note for classification of long-term loans: Nil
Other explanation, including interest rate interval: nil
31. Long-term account payable
(1) Listed by nature
In RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Hi-tech Branch of Nanjing Finance Bureau [note ①]|1,140,000.00|1,140,000.00|
|Hi-tech Branch of Nanjing Finance Bureau[note ②]|1,250,000.00|1,250,000.00|
|Hi-tech Branch of Nanjing Finance Bureau[note ③]|1,230,000.00|1,230,000.00|
|Loan transferred from treasury bond [note ④]|1,017,272.00|1,356,363.00|
|Hi-tech Branch of Nanjing Finance Bureau[note ⑤]|2,750,000.00|2,750,000.00|
|Hi-tech Branch of Nanjing Finance Bureau[note ⑥]|1,030,000.00|1,030,000.00|
|Hi-tech Branch of Nanjing Finance Bureau[note ⑦]|960,000.00|960,000.00|

||||
|-|-|-|
|Hi-tech Branch of Nanjing Finance Bureau[note ⑧]|5,040,000.00|5,040,000.00|
|Hi-tech Branch of Nanjing Finance Bureau[note ⑨]|2,740,000.00|2,740,000.00|
|Hi-tech Branch of Nanjing Finance Bureau[note ⑩]|2,250,000.00||
|Total|19,407,272.00|17,496,363.00|

 Other explanation:
[Note① To encourage Weifu Jinning to enter Nanjing High-tech Technology Industry Development Zone, financial supporting capital is allotted by High-tech branch of Finance Bureau of Nanjing for supporting use, the term is from 20 October 2005 to 20 October 2020. Provided that the operation period in the zone is less than 15 years, financial supporting capital will be reimbursed.
[Note②] To encourage Weifu Jinning to enter Nanjing High-tech Technology Industry Development Zone, financial supporting capital is allotted by High-tech branch of Finance Bureau of Nanjing for supporting use, the term is from 20 July 2006 to 20 July 2021. Provided that the operation period in the zone is less than 15 years, financial supporting capital will be reimbursed.
[Note③] To encourage Weifu Jinning to enter Nanjing High-tech Technology Industry Development Zone, financial supporting capital is allotted by High-tech branch of Finance Bureau of Nanjing for supporting use, the term is from 17 September 2007 to 17 September 2022. Provided that the operation period in the zone is less than 15 years, financial supporting capital will be reimbursed.
[Note④] Loan transferred from treasury bond: Weifu Jinning received RMB1.87 million Yuan of special funds from budget of the central government, and RMB1.73 million Yuan of special funds from budget of the local government. The non-operating income transferred in was 1.87 million Yuan in 2011 which was confirmed not to return, if the Company pays back special funds of 3.73 million Yuan to the local government in 11 years since 2012, then the Company needs to repay the principal of 339,091.00 Yuan each year.
[Note⑤] To encourage Weifu Jinning to enter Nanjing High-tech Technology Industry Development Zone, financial supporting capital is allotted by High-tech branch of Finance Bureau of Nanjing for supporting use, the term is from 10 November 2008 to 10 November 2023. Provided that the operation period in the zone is less than 15 years, financial supporting capital will be reimbursed.
[Note⑥] To encourage Weifu Jinning to enter Nanjing High-tech Technology Industry Development Zone, financial supporting capital is allotted by High-tech branch of Finance Bureau of Nanjing for supporting use, the term is from 27 October 2009 to 27 October 2024. Provided that the operation period in the zone is less than 15 years, financial supporting capital will be reimbursed.
[Note⑦] To encourage Weifu Jinning to enter Nanjing High-tech Technology Industry Development Zone, financial supporting capital is allotted by High-tech branch of Finance Bureau of Nanjing for supporting use, the term is from 27 December 2010 to 27 December 2025. Provided that the operation period in the zone is less than 15 years, financial supporting capital will be reimbursed.
[Note⑧] To encourage Weifu Jinning to enter Nanjing High-tech Technology Industry Development Zone, financial supporting capital is allotted by High-tech branch of Finance Bureau of Nanjing for supporting use, the term is from 28 December 2011 to 28 December 2026. Provided that the operation period in the zone is less than 15 years, financial supporting capital will be reimbursed.
[Note⑨] To encourage Weifu Jinning to enter Nanjing High-tech Technology Industry Development Zone, financial supporting capital is allotted by High-tech branch of Finance Bureau of Nanjing for supporting use, the
term is from 18 December 2013 to 18 December 2028. Provided that the operation period in the zone is less than
15 years, financial supporting capital will be reimbursed.
[Note⑩]: Financial support funds are the support funds provided by the management office of Nanjing Intelligent
Manufacturing Industrial Park to encourage Weifu Jinning to enter Nanjing Intelligent Manufacturing Industrial Park, and the allotted time is from February 11, 2018 to February 11, 2033. If the operating period in the area is less than 15 years, the financial support funds shall be refunded.
32. Long-term employee payable
(1) Long-term employee payable
In RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|II. Dismiss welfare|13,782,896.07|13,782,896.07|
|III. Other long-term welfare|16,665,236.81|16,665,236.81|
|Total|30,448,132.88|30,448,132.88|

 (2) Change of defined benefit plans
Nil
33. Special payable
In RMB
|||||||
|-|-|-|-|-|-|
||Opening|Increase during|Decreased during|||
|Item||||Closing balance|Causes|
||balance|the period|the period|||
|Removal compensation of subsidiary Weifu||||||
||18,265,082.11|||18,265,082.11||
|Jinning [note ]||||||
|Total|18,265,082.11|||18,265,082.11|--|

 Other explanation:
Note: Removal compensation of subsidiary Weifu Jinning: in line with regulation of the house acquisition decision ofPeople’s government of Xuanwu District, Nanjing City, Ning Xuan Fu Zheng Zi (2012) No.001, part of the lands and property of Weifu Jingning needs expropriation in order to carry out the comprehensively improvement of Ming Great Wall. According to the house expropriation and compensation agreement in state-owned lands signed between Weifu Jinning and House Expropriation Management Office of Xuanwu District, Nanjing City, RMB 19.7067 million in total are compensate, including operation losses from lessee RMB 1.4416 million in total. The above compensation was received in last period and is making up for the losses from lessee, and the above lands and property have not been collected up to 30 August 2018.
34. Deferred income
In RMB
|||||||
|-|-|-|-|-|-|
|Item|Opening balance|Increase during the period|Decreased during the period|Closing balance|Causes|
|Government grand|451,281,721.77|1,395,000.00|13,132,459.71|439,544,262.06||

|||||||
|-|-|-|-|-|-|
|Total|451,281,721.77|1,395,000.00|13,132,459.71|439,544,262.06|--|

 Item with government grants involved:
In RMB
||||||||||
|-|-|-|-|-|-|-|-|-|
||||Amount||||||
||||reckoned|Amount|Cost|Othe|||
|||||||||Assets|
|||New grants in|in|reckoned into|reduction|r|||
|Item|Opening balance||||||Ending balance|related/Incom|
|||the Period|non-operat|other income|in the|chan|||
|||||||||e related|
||||ion|in the period|period|ges|||
||||revenue||||||
|Industrialization|||||||||
|project for injection|||||||||
|VE pump system|||||||||
|||||||||Assets|
|with electronically|||||||||
||3,605,001.46|||721,000.30|||2,884,001.16|related/Incom|
|controlled high|||||||||
|||||||||e related|
|pressure for|||||||||
|less-emission diesel|||||||||
|used|||||||||
|Appropriation on|||||||||
|reforming of|||||||||
|production line|||||||||
|technology and|||||||||
|R&D ability of|7,100,000.00||||||7,100,000.00|Assets related|
|common rail system|||||||||
|for diesel by|||||||||
|distributive|||||||||
|high-voltage|||||||||
|Fund of industry||||||||Income|
||60,400,000.00||||||60,400,000.00||
|upgrade (2012)||||||||related|
|Fund of industry||||||||Income|
||60,520,000.00||||||60,520,000.00||
|upgrade (2013)||||||||related|
|Appropriation on|||||||||
|central basic|||||||||
||2,857,142.87||||||2,857,142.87|Assets related|
|construction|||||||||
|investment|||||||||
|R&D and|||||||||
|industrialization of|||||||||
|the high pressure|||||||||
|variable pump of the|9,956,904.72||||||9,956,904.72|Assets related|
|common rail system|||||||||
|of diesel engine for|||||||||
|automobile|||||||||

|||||||
|-|-|-|-|-|-|
|Research institute of||||||
|motor vehicle||||||
|exhaust|3,116,125.34|||3,116,125.34|Assets related|
|aftertreatment||||||
|technology||||||
|Fund of industry|||||Income|
||36,831,000.00|||36,831,000.00||
|upgrade (2014)|||||related|
|New-built assets||||||
|compensation after||||||
||170,951,302.78||11,813,783.39|159,137,519.39|Assets related|
|the removal of||||||
|parent company||||||
|Fund of industry|||||Income|
||40,000,000.00|||40,000,000.00||
|upgrade (2016)|||||related|
|Guiding capital for||||||
|the technical reform||||||
|from State Hi-Tech|9,740,000.00|||9,740,000.00|Assets related|
|Technical||||||
|Commission||||||
|Implementation of||||||
|the variable||||||
|cross-section|12,438,231.54|||12,438,231.54|Assets related|
|turbocharger for||||||
|diesel engine||||||
|Demonstration||||||
|project for||||||
||1,808,806.64|880,000.00||2,688,806.64|Assets related|
|intelligent||||||
|manufacturing||||||
||||||Assets relatedIncomerelated|
|Other|31,957,206.42|515,000.00|597,676.02|31,874,530.40||
|Total|451,281,721.77|1,395,000.00|13,132,459.71|439,544,262.06|--|

 Other explanation:
(1) Appropriation on industrialization project of electrical control and high voltage jet VE system of low emissions diesel: in September 2009, Weifu Jinning signed “Project Contract of Technology Outcome Transferring Special Capital in Jiangsu Province” with Nanjing Technical Bureau, according to which Weifu Jinning received appropriation RMB 6.35 million in 2009, RMB 4.775 million received in 2010 and RMB 0.875 million received in 2011. According to the contract, the attendance date of this project was: from October of 2009 to March of 2012. This contract agreed62% of newly increased investment in project would be spent in fixed assets investment which are belongs to the government grand with assets/income concerned. In 2013, accepted by
the science& technology agency of Jiangsu Province, and RMB 4,789,997.04 with income related was reckoned
into current operation revenue directly; the RMB 7,210,002.96 with assets related was amortized during the
predicted service period of the assets, and RMB 721,000.30 amortized in the Period.
(2) The appropriation for research and development ability of distributive high-pressure common rail system for diesel engine use and production line technological transformation project: according to XCJ No.[2010] 59, the Company has received special funds of 7.1 million Yuan appropriated by Finance Bureau of Wuxi New District in 2011 and used for theCompany’s research and development ability of distributive high-pressure common rail system for diesel engine use and production line technological transformation project; this appropriation belongs to government subsidies related to assets, and will be amortized according to the depreciation process of the underlying assets when the project is completed.
(3) Industry upgrading funds (2012): In accordance with the document Xi Xin Guanjing Fa[2012] No.216 and Document Xi Xin Guancai Fa[2012] No. 85, the Company received funds of 60.4 million Yuan appropriated for industry upgrading this year.
(4) Industry upgrading funds (2013): In accordance with the document Xi Xin Guan Jing Fa[2013] No.379, Xi Xin Guan Jing Fa[2013] No.455, Xi Xin Guan Cai Fa[2013] No.128 and Xi Xin Guan Cai Fa[2013] No.153, the Company received funds of 60.52 million Yuan appropriated for industry upgrading in 2013.
(5) Appropriation for investment of capital construction from the central government: In accordance with the document Xi Caijian[2012] No.43, the Company received appropriation of 5 million Yuan for investment of capital construction from the central government in 2012. The project has passed the acceptance check in current period, this appropriation should be amortized within the surplus service life of current assets.
(6)R&D and industrialization of the high pressure variable pump of the common rail system of diesel engine for automobile: the Company received appropriated for the project in 2013 with 8.05 million Yuan in line with documents of Xi Ke Ji[2013] No.186, Xi Ke Ji[2013] No.208, Xi Cai Gong Mao[2013] No.104, Xi Cai Gong Mao[2013] No.138, Xi Ke Ji[2014] No.125, Xi Cai Gong Mao[2014] No.58, Xi Ke Ji[2014] No. 246 and Xi Cai Gong Mao[2014] No.162. Received RMB 3 million in 2014 and RMB 0.45 million in 2015; and belongs to government grant with assets concerned, and shall be amortized according to the depreciation process.
(7) Vehicle exhaust after-treatment technology research institute project: in 2012, the subsidiary Weifu Leader has applied for equipment purchase assisting funds to Wuxi Huishan Science and Technology Bureau and Wuxi Science and Technology Bureau for the vehicle exhaust after-treatment technology research institute project. This declaration has been approved by Wuxi Huishan Science and Technology Bureau and Wuxi Science and Technology Bureau in 2012, and the company has received appropriation of 2.4 million Yuan in 2012, and received appropriation of 1.6 million Yuan in 2013. This appropriation belongs to government subsidies related to assets and will be amortized according to the depreciation process.
(8) Industry upgrading funds (2014): In accordance with the document Xi Xin Guan Jing Fa[2014] No.427 and Xi Xin Guan Cai Fa[2014] No.143, the Company received funds of 36.831 million Yuan appropriated for industry upgrading in 2014.
(9) New-built assets compensation after the removal of parent company: policy relocation compensation received by the Company, and will be amortized according to the depreciation of new-built assets, amount of
11,813,783.39 Yuan amortize in the year.
(10) Fund of industry upgrade (2016): In accordance with the document Xi Xin Guan Jing Fa[2016] No.585 and Xi Xin Fa[2016] No.70, the Company received funds of 40 million Yuan appropriated for industry upgrading in 2016.
(11) Guiding capital for the technical reform from State Hi-Tech Technical Commission: In accordance with the document Xi Jing Xin ZH[2016] No.9 and Xi Cai GM[2016] No.56, the Company received a 9.74 million Yuan for the guiding capital of technical reform (1st batch) from Wuxi for year of 2016, which included in the government subsidy with assets-concerned, and will amortized according to the depreciation process after acceptance
(12) Implementation of the variable cross-section turbocharger for diesel engine: In accordance with the document YCZFa[2016] NO.623 and “Strong Industrial Base Project Contract for year of 2016”, subsidiary Weifu Tianli received a specific subsidy of 16.97 million Yuan, the fund supporting strong industrial base project (made-in-China 2025) of central industrial transformation and upgrading 2016 from Ministry of Industry and Information Technology; and belongs to government grant with assets concerned, and shall be amortized according to the depreciation process.
(13) Demonstration project for intelligent manufacturing: under the Notice Relating to Selection of the Intelligent Manufacturing Model Project in Huishan District in 2016(HJXF[2016]No.36), a fiscal subsidy of 3,000,000 Yuan was granted by relevant government authority in Huishan district to our subsidiary Weifu Leader in 2017, totally 0.88 million Yuan appropriate funds received in the year, to be utilized for transformation and upgrade of WeifuLeader’s intelligent manufacturing facilities. This subsidy belongs to government grant related to assets which shall be amortized based on the depreciation progress of the assets.
35. Share capital
In RMB
|||||||||
|-|-|-|-|-|-|-|-|
|||Change during the period(+,-)||||||
||Opening balance|New shares||Shares transferred from|||Closing balance|
||||Bonus share||Other|Subtotal||
|||issued||capital reserve||||
|Total shares|1,008,950,570.00||||||1,008,950,570.00|

 36. Capital reserve
In RMB
||||||
|-|-|-|-|-|
|Item|Opening balance|Increase during the period|Decreased during the period|Closing balance|
|Capital premium (Share|||||
||3,372,647,413.97|||3,372,647,413.97|
|capital premium)|||||
|Other Capital reserves|45,193,988.92||1,824,597.47|43,369,391.45|
|Total|3,417,841,402.89||1,824,597.47|3,416,016,805.42|

37. Other consolidated income
In RMB
|||||||||
|-|-|-|-|-|-|-|-|
|||Current period||||||
||||Less: written in|||||
||||other|||||
|Item|Opening balance|Account before|comprehensive|||Belong to|Closing|
||||income in|||||
|||income tax in the|previous period|Less : income tax|Belong to parent|minority|balancer|
|||||expense|company after taxs|hareholde||
|||period|and carried|||s after tax||
||||forward to gains|||||
||||and losses in|||||
||||current period|||||
|II. Other|||||-58,302,580.35|||
|comprehensive||||||||
|income items which||||||||
||87,169,455.01|-59,786,808.00|8,804,463.00|-10,288,690.65|||28,866,874.66|
|will be reclassified||||||||
|subsequently to||||||||
|profit or loss||||||||
|Gains or losses|||||-58,302,580.35|||
|arising from||||||||
|changes in fair value|87,169,455.01|-59,786,808.00|8,804,463.00|-10,288,690.65|||28,866,874.66|
|of available-for-sale||||||||
|financial assets||||||||
|Total other|87,169,455.01||||-58,302,580.35||28,866,874.66|
|||-59,786,808.00|8,804,463.00|-10,288,690.65||||
|consolidated income||||||||

38. Reasonable reserve
In RMB
||||||
|-|-|-|-|-|
|||Increase during the|Decrease during this|Closing balance|
|Item|Opening balance||||
|||period|period||
|Safety production costs|2,606.93|10,050,468.85|8,933,473.96|1,119,601.82|
|Total|2,606.93|10,050,468.85|8,933,473.96|1,119,601.82|

 Other explanation, including changes and reasons for changes:
According to the “management method of extraction and use the safety production costs for enterprise” Cai Qi[2012] No.16 jointly issued by Ministry of Finance and Administration of Production Safety Supervision, the provision is based on the actual operation revenue of last period, extract on average month-by-month basis through excess regressive method
Among the above safety production costs, including the safety production costs accrual by the Company in line with regulations and the parts enjoy by shareholders of the Company in safety production costs accrual by subsidiary in line with regulations.
39. Surplus reserves
In RMB
||||||
|-|-|-|-|-|
|Item|Opening balance|Increase during the period|Decrease during this period|Closing balance|
|Statutory surplus|||||
||510,100,496.00|||510,100,496.00|
|reserves|||||
|Total|510,100,496.00|||510,100,496.00|

 Other explanation, including changes and reasons for changes:
Withdrawal of the statutory surplus reserves: Pursuit to the Company Law and Article of Association, the Company extracted statutory surplus reserve on 10 percent of the net profit. No more amounts shall be withdrawal if the accumulated statutory surplus reserve takes over 50 percent of the registered capital.
40. Retained profit
In RMB
||||
|-|-|-|
|Item|Current period|Last period|
|Retained profits at the end of last period before adjustment|9,811,609,138.92|7,845,639,990.88|
|Retained profits at the beginning of the period after adjustment|9,811,609,138.92|7,845,639,990.88|
|Add: The net profits belong to owners of patent company of this period|1,545,242,704.92|2,571,339,490.04|
|Common dividend payable|1,210,740,700.00|605,370,342.00|
|Retained profit at period-end|10,146,111,143.84|9,811,609,138.92|

 Details about adjusting the retained profits at the beginning of the period:
1) The retroactive adjustments to Accounting Standards for Business Enterprises and its relevant new regulations affect the retained profits at the beginning of the period amounting to 0 Yuan.
2) The changes in accounting policies affect the retained profits at the beginning of the period amounting to 0 Yuan.
3) The major accounting error correction affects the retained profits at the beginning of the period amounting to 0 Yuan
4) Merge scope changes caused by the same control affect the retained profits at the beginning of the period amounting to 0 Yuan. 5) Other adjustments affect the retained profits at the beginning of the period amounting to 0 Yuan
41. Operating income and cost
In RMB
||||||
|-|-|-|-|-|
||Current period||Last period||
|Item|||||
||Income|Cost|Income|Cost|
|Main operating|4,725,759,054.05|3,682,028,566.53|4,480,811,897.39|3,526,184,596.99|
|Other operating|235,042,836.94|207,561,723.16|247,313,701.63|210,106,341.87|
|Total|4,960,801,890.99|3,889,590,289.69|4,728,125,599.02|3,736,290,938.86|

42. Business tax and surcharges
In RMB
||||
|-|-|-|
|Item|Current period|Last period|
|City maintenance and construction tax|15,131,214.76|15,554,573.84|
|Educational surtax|10,807,786.47|11,107,313.56|
|Property tax|7,130,285.13|6,488,252.36|
|Land use tax|3,243,530.28|3,131,115.90|
|Vehicle use tax|24,297.00|18,915.00|
|Stamp duty|1,578,877.86|1,556,803.30|
|Other taxes|84,360.90|5,308.52|
|Total|38,000,352.40|37,862,282.48|

 43. Sales expenses
In RMB
||||
|-|-|-|
|Item|Current period|Last period|
|Salary and fringe benefit|23,852,704.11|16,800,347.95|
|Consumption of office materials and business travel charge|5,767,944.92|5,184,310.23|
|Transportation charge|19,146,343.03|17,050,992.80|
|Warehouse charge|3,241,966.63|1,546,815.48|
|Three-guarantee fee|40,015,843.08|20,963,280.32|
|Business entertainment fee|8,251,206.32|6,230,440.89|
|Other|6,071,551.76|3,783,074.99|
|Total|106,347,559.85|71,559,262.66|

 44. Administration expenses
In RMB
||||
|-|-|-|
|Item|Current period|Last period|
|Salary and fringe benefit|94,992,042.41|116,204,076.96|
|Depreciation charger and long-term assets amortization|24,091,878.82|23,516,873.88|
|Consumption of office materials and business travel charge|7,840,515.40|10,088,373.09|
|Incentive fund|64,279,800.00|41,805,000.00|
|Other|222,779,142.15|207,954,410.80|
|Total|413,983,378.78|399,568,734.73|

45. Financial expenses
In RMB
||||
|-|-|-|
|Item|Current period|Last period|
|Interest expenses|9,075,955.05|4,482,686.51|
|Note discount interest expenses|409,282.24|402,851.58|
|Saving interest income|-11,684,097.62|-9,918,625.28|
|Gains/losses from exchange|-491,644.75|6,084,256.36|
|Handling charges|913,596.71|636,882.15|
|Total|-1,776,908.37|1,688,051.32|

 Other explanation:
The interest expenses for year of 2017 including the 1,135,848.00 Yuan received of regards for the provincial engineering center
46. Asset impairment loss
In RMB
||||
|-|-|-|
|Item|Current period|Last period|
|I. Bad debt loss|2,192,563.70|1,918,243.57|
|II. Inventory falling price loss|-2,202,651.08|-13,214,717.13|
|Total|-10,087.38|-11,296,473.56|

 47. Investment income
In RMB
||||
|-|-|-|
|Item|Current period|Last period|
|Income of long-term equity investment calculated based on equity|968,640,145.91|833,565,520.64|
|Investment income from holding financial assets available for sales|3,220,575.00|235,500.00|
|Investment income obtained from disposal of financial assets available for sales|17,370,816.75|24,625,516.88|
|Entrust financial income|159,801,630.73|97,021,850.83|
|Gains/losses of subsidiary liquidation||-10,472.99|
|Total|1,149,033,168.39|955,437,915.36|

 48. Income from assets disposal
In RMB
||||
|-|-|-|
|Sources|Current period|Last period|
|Income from disposal of non-current assets|1,820,229.59|235,193.85|

||||
|-|-|-|
|Losses from disposal of non-current assets|-232,044.23|-360,974.45|
|Total|1,588,185.36|-125,780.60|

 49. Other income
In RMB
||||
|-|-|-|
|Source of other income|Current period|Last period|
|Government subsidy related with daily operation activities|14,032,459.71|15,608,007.28|
|Total|14,032,459.71|15,608,007.28|

 50. Non-operating income
In RMB
|||||
|-|-|-|-|
||||Amount reckoned into current|
|Item|Current period|Last period||
||||non-recurring gains/losses|
|Government subsidy|3,667,570.4|6 1,498,749.45|3,667,570.46|
|Other|213,558.4|1 1,285,830.03|213,558.41|
|Total|3,881,128.8|7 2,784,579.48|3,881,128.87|

 Government subsidy reckoned into current gains/losses:
In RMB
||||||||||
|-|-|-|-|-|-|-|-|-|
||||Naturetype|Whether the|||||
|||Caus|||||||
||Gran|||impact of|Whether||||
|||e of||||||Assets|
||ting|||subsidies on|special|Current|||
|Item||distri|||||Last period|related/Incom|
||subj|||the current|subsidie|period|||
|||butio||||||e related|
||ect|||profit and|s||||
|||n|||||||
|||||loss|||||
|||||||||Income|
|Steady post subsidy in Wuxi||||No|No|967,170.46|1,402,281.45||
|||||||||related|
|Social insurance fund for recruiting college|||||||||
|||||||||Income|
|graduates by small & medium enterprise in||||No|No||27,468.00||
|||||||||related|
|Ningbo City|||||||||
|||||||||Income|
|Patent funding||||No|No|621,500.00|||
|||||||||related|
|Fund of manufacturing of intelligent|||||||||
|||||||||Income|
|transformation for common rail pump in||||No|No|1,340,000.00|||
|||||||||related|
|Huishan District|||||||||
|Grants of high-tech enterprise recognized|||||||||
|||||||||Income|
|award from Management Committee of||||No|No|500,000.00|||
|||||||||related|
|Jiangbei District|||||||||

||||||||||
|-|-|-|-|-|-|-|-|-|
|||||||||Income|
|Discount on imported equipment||||No|No|103,000.00|||
|||||||||related|
|Employment subsidy from Employment|||||||||
|||||||||Income|
|management service of Jiangbei District,||||No|No|86,520.00|||
|||||||||related|
|Ningbo City|||||||||
|Special fund for 333 high-end talents||||||||Income|
|||||No|No|30,000.00|||
|training project||||||||related|
|||||||||Income|
|Other||||No|No|19,380.00|69,000.00||
|||||||||related|
|Total|--|--|--|--|--|3,667,570.46|1,498,749.45|--|

 51. Non-operating expenditure
In RMB
|||||
|-|-|-|-|
||||Amount reckoned into current|
|Item|Current period|Last period||
||||non-recurring gains/losses|
|Total non-current assets disposal losses|167,094.34|1,175,039.72|167,094.34|
|Including: fixed assets disposal losses|167,094.34|1,175,039.72|167,094.34|
|Donations||13,500.00||
|Local fund|2,015,771.73|1,957,389.72||
|Other|145,006.31|618,295.22|145,006.31|
|Total|2,327,872.38|3,764,224.66|312,100.65|

 52. Income tax expense
(1) Statement of income tax expense
In RMB
||||
|-|-|-|
|Item|Current period|Last period|
|Payable tax in current period|102,952,291.92|84,212,598.76|
|Adjusted the previous income tax|-603,416.68|-644,798.91|
|Increase/decrease of deferred income tax assets|633,939.20|10,513,650.01|
|Increase/decrease of deferred income tax liability|-55,516.48|-55,516.50|
|Total|102,927,297.96|94,025,933.36|

 (2) Adjustment on accounting profit and income tax expenses
In RMB
|||
|-|-|
|Item|Current period|
|Total profit|1,680,874,375.97|
|Income tax measured by statutory/applicable tax rate|252,131,156.40|
|Impact by different tax rate applied by subsidies|3,581,538.92|
|Adjusted the previous income tax|-603,416.68|
|Impact by non-taxable revenue|-145,876,642.65|
|Impact by the deductible losses of the un-recognized previous deferred income tax|-4,510,779.88|
|The deductible temporary differences or deductible losses of the un-recognized||
||492,355.10|
|deferred income tax assets in the Period||
|Other|-2,286,913.25|
|Income tax expense|102,927,297.96|

 53. Other comprehensive income
See Note VII. 35 “Other comprehensive income”
54. Items of ash flow statement
(1) Other cash received in relation to operation activities
In RMB
||||
|-|-|-|
|Item|Current period|Last period|
|Income from bank deposit interest|12,485,826.79|10,505,698.00|
|Government subsidy|8,212,570.46|8,156,049.45|
|Other|181,546.85|1,051,339.77|
|Total|20,879,944.10|19,713,087.22|

 (2) Other cash paid in relation to operation activities
In RMB
||||
|-|-|-|
|Item|Current period|Last period|
|Expenses of sales cash paid|46,539,395.20|45,844,220.52|
|Expenses of management cash paid|100,789,163.46|104,847,303.37|
|Other|6,641,913.18|3,396,065.05|
|Total|153,970,471.84|154,087,588.94|

(3) Cash received from other investment activities
Nil
(4) Cash paid related with investment activities
In RMB
||||
|-|-|-|
|Item|Current period|Last period|
|Borrowing of Baodun (Tianjin) Electrical|||
||10,000,000.00||
|Co., Ltd. are paid|||
|Total|10,000,000.00||

(5) Other cash received in relation to financing activities
In RMB
||||
|-|-|-|
|Item|Current period|Last period|
|Weifu Leader received the borrowings|||
||5,470,000.00||
|from Wuxi Industrial Group|||
|Total|5,470,000.00||

(6) Cash paid related with financing activities
In RMB
||||
|-|-|-|
|Item|Current period|Last period|
|Liquidation charges||1,049,711.28|
|National debt paid transfer to loans|339,091.00||
|Total|339,091.00|1,049,711.28|

 55. Supplementary information to statement of cash flow
(1) Supplementary information to statement of cash flow
In RMB
||||
|-|-|-|
|Supplementary information|This Period|Last Period|
|1. Net profit adjusted to cash flow of operation activities:|--|--|
|Net profit|1,577,947,078.01|1,368,367,366.03|
|Add: Assets impairment provision|-10,087.38|-11,296,473.56|
|Depreciation of fixed assets, consumption of oil assets and depreciation of|||
||142,796,801.99|134,523,929.25|
|productive biology assets|||
|Amortization of intangible assets|8,927,389.15|9,475,063.57|
|Amortization of long-term deferred expenses|1,093,846.42|1,281,403.15|
|Loss from disposal of fixed assets, intangible assets and other long-term|-1,588,185.36|1,300,820.32|

||||
|-|-|-|
|assets(gain is listed with “-”)|||
|Losses on scrapping of fixed assets (gain is listed with “-”)|167,094.34||
|Financial expenses (gain is listed with “-”)|8,265,783.22|5,167,986.51|
|Investment loss (gain is listed with “-”)|-1,149,683,398.46|-953,391,921.75|
|Decrease of deferred income tax asset( (increase is listed with “-”)|633,939.20|10,513,650.01|
|Increase of deferred income tax liability (decrease is listed with “-”)|-55,516.48|-55,516.50|
|Decrease of inventory (increase is listed with “-”)|241,085,663.64|228,492,024.91|
|Decrease of operating receivable accounts (increase is listed with “-”)|-606,831,311.20|-684,474,762.93|
|Increase of operating payable accounts (decrease is listed with “-”)|154,832,323.82|255,605,734.75|
|Other|1,342,269.57|-13,108,062.24|
|Net cash flow arising from operating activities|378,923,690.48|352,401,241.52|
|2. Material investment and financing not involved in cash flow|--|--|
|3. Net change of cash and cash equivalents:|--|--|
|Balance of cash at period end|2,842,510,815.26|1,595,210,818.24|
|Less: Balance of cash equivalent at period-begin|2,948,439,354.22|3,795,223,678.11|
|Net increasing of cash and cash equivalents|-105,928,538.96|-2,200,012,859.87|

 (2) Net cash payment for the acquisition of a subsidiary of the current period
Nil
(3) Net cash received from the disposal of subsidiaries
Nil
(4) Constitution of cash and cash equivalent
In RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Ⅰ. Cash|2,842,510,815.26|2,948,439,354.22|
|Including: stock cash|594,764.72|736,773.22|
|Bank deposit available for payment at any time|2,841,916,050.54|2,947,702,581.00|
|Ⅲ. Balance of cash and cash equivalent at period-end|2,842,510,815.26|2,948,439,354.22|

 56. Notes for the statement of owners equity changes
Nil
57. Assets with ownership or use right restricted
In RMB
||||
|-|-|-|
|Item|Book value at|Restriction reason|
||period-end||
|Monetary fund|99,317,091.42|Cash deposit for bank acceptance|
|Notes receivable|389,454,825.85|Notes pledge for bank acceptance|
|Monetary fund|881,868.57|Court freeze|
|||In accordance with the civil ruling No.(2016)Y03MC2490 and No.(2016) Y03MC2492 of|
|||Guangdong Shenzhen Intermediate People's Court (Hereinafter referred to as “Shenzhen|
|||Intermediate People's Court”), the property with the value of 217 million Yuan under the|
|Financial assets|||
||166,608,867.78|name of the Company and other seven respondents and the third party Shenzhen Hejun|
|availablefor sale|||
|||Chuangye Holdings Co., Ltd. was frozen. As of the end of the reporting period, 4.71 million|
|||shares of Miracle Logistics and 11,739,102 shares of SDEC held by the Company were|
|||frozen.|
|Total|656,262,653.62|--|

58. Item of foreign currency
(1) Item of foreign currency
In RMB
|||||
|-|-|-|-|
|Item|Closing balance of foreign currency|Rate of conversion|Ending RMB balance converted|
|Monetary fund||||
|Including: USD|15,019,676.83|6.6166|99,379,193.71|
|EUR|1,959,035.57|7.6515|14,989,560.66|
|HKD|9,178,111.52|0.8431|7,738,065.82|
|JPY|9,248,508.00|0.059914|554,115.12|
|Accounts receivable||||
|Including: USD|4,805,349.78|6.6166|31,795,077.36|
|EUR|968,745.75|7.6515|7,412,358.10|
|JPY|11,348,905.00|0.059914|679,958.29|
|Accounts payable||||
|Including: USD|673,126.61|6.6166|4,453,809.52|
|EUR|1,597,806.15|7.6515|12,225,613.75|
|CHF|20,630.15|6.6350|136,881.05|
|JPY|94,543,893.00|0.059914|5,664,502.81|

(2) Explanation on foreign operational entity, including as for the major foreign operational entity, disclosed main operation place, book-keeping currency and basis for selection; if the book-keeping currency changed, explain reasons
□ Applicable√ Not applicable
VIII. Changes of consolidation range
1. Enterprise merger not under the same control
Nil
2. Enterprise merger under the same control
Nil
3. Reverse purchase
Nil
4. The disposal of subsidiaries
Whether there is a subsidiary disposal on one time, which is loss control of rights
□Yes√No
Whether there is a subsidiary disposal by steps through multiple trading and loss control of rights in the period
□Yes√No
5. Other reasons for consolidation range changed
Explain the reasons on consolidate scope changes (i.e. subsidiary newly established, subsidiary liquidation etc.) and relevant information:
In the Year, the wholly-owned subsidiary– Nanchang Weifu Leader Auto Parts Co., Ltd. was establised by investment from Weifu Leader, the industrial and commerce record was conpleted on 8 March 2018, and there was no business exercise in the reporting period actually
6. Other
Nil
IX. Equity in other entity
1. Equity in subsidiary
(1) Constitute of enterprise group
||||||||
|-|-|-|-|-|-|-|
||Main operation|Registere||Share-holding ratio|||
|Subsidiary|||Business nature|||Acquired way|
||place|d place||Directly|Indirectly||
||||Spare parts of|||Enterprise merger under|
|Weifu Jinning|Nanjing|Nanjing||80.00%|||
||||internal-combustion engine|||the same control|
||||Automobile exhaust purifier,|||Enterprise merger under|
|Weifu Leader|Wuxi|Wuxi||94.81%|||
||||muffler|||the same control|
||||Spare parts of||||
|Weifu Mashan|Wuxi|Wuxi||100.00%||Investment|
||||internal-combustion engine||||
||||Spare parts of||||
|Weifu Chang’an|Wuxi|Wuxi||100.00%||Investment|
||||internal-combustion engine||||
|Weifu|||||||
|||||||Enterprise merger under|
|International|Wuxi|Wuxi|Trading|100.00%|||
|||||||the same control|
|Trade|||||||
||||Spare parts of|||Enterprise merger not|
|Weifu ITM|Wuxi|Wuxi||100.00%|||
||||internal-combustion engine|||under the same control|
||||Spare parts of||||
|Weifu Schmidt|Wuxi|Wuxi||66.00%||Investment|
||||internal-combustion engine||||
||||Spare parts of|||Enterprise merger not|
|Weifu Tianli|Ningbo|Ningbo||54.23%|||
||||internal-combustion engine|||under the same control|
||||Spare parts of|||Enterprise merger not|
|Weifu Autocam|Wuxi|Wuxi||51.00%|||
||||internal-combustion engine|||under the same control|
|Weifu|||Automobile exhaust purifier,||||
||Wuhan|Wuhan|||60.00%|Investment|
|Leader(Wuhan)|||muffler||||
|Weifu Leader||Chongqin|Automobile exhaust purifier,||||
||Chongqing||||100.00%|Investment|
|(Chongqing)||g|muffler||||
|Weifu Leader|||Automobile exhaust purifier,||||
||Nanchang|Nanchang|||100.00%|Investment|
|(Nanchang)|||muffler||||

Explanation on share-holding ratio in subsidiary different from ratio of voting right: Nil
Basis of the invested unit control by the Company though holds half or below voting rights; and the invested unit without controls by the Company but with over half voting rights hold: Nil
Major structured entity included in consolidate statement: Nil
Basis of termination of agent or consigner: Nil
Other note:
In accordance with the resolution of Office Meeting 2017 No.(002), the6.29% shares of Weifu Tianli held by Ningbo Shenhua Energy-Saving and Enviornmental Protection Tech. Co., Ltd. are acquired in the Year, after acquisition, shares of Weifu Tianli held by the Company increased to54.23%, and file in industry and commerce bureau on 8 May 2018.
(2) Important non-wholly-owned subsidiary
In RMB
||||||
|-|-|-|-|-|
||Share-holding ratio of|Gains/losses attributable|Dividend announced to distribute|Ending equityof minority|
|Subsidiary|||||
||minority|to minority in the Period|for minority in the Period||
|Weifu Jinning|20.00%|14,039,076.96|15,604,600.00|166,673,874.88|
|Weifu Schmidt|34.00%|103,977.38||9,699,940.40|
|Weifu Leader|5.19%|3,712,573.37||85,078,510.19|
|Weifu Tianli|45.77%|3,707,146.34||100,120,917.35|
|Weifu Autocam|49.00%|11,141,599.05||158,494,159.40|
|Total||32,704,373.09|15,604,600.00|520,067,402.22|

 Explanation on holding ratio different from the voting right ratio for minority shareholders: Nil
(3) Main finance of the important non-wholly-owned subsidiary
In RMB
||||||||
|-|-|-|-|-|-|-|
||Closing balance||||||
|Subsidiary||Non-current|||Non-current||
||Current assets||Total assets|Current liability||Total liability|
|||assets|||liability||
|Weifu Jinning|844,802,667.29|331,265,814.56|1,176,068,481.85|285,415,594.32|55,389,251.34|340,804,845.66|
|Weifu Schmidt|92,971,564.08|38,943,805.27|131,915,369.35|102,971,926.15||102,971,926.15|
|Weifu Leader|2,491,180,678.70|1,045,889,830.01|3,537,070,508.71|1,881,471,789.42|24,300,604.32|1,905,772,393.74|
|Weifu Tianli|329,410,523.92|223,968,657.04|553,379,180.96|283,848,085.10|61,052,803.89|344,900,888.99|
|Weifu Autocam|292,491,401.69|280,137,032.48|572,628,434.17|251,950,534.98||251,950,534.98|
|Total|4,050,856,835.68|1,920,205,139.36|5,971,061,975.04|2,805,657,929.97|140,742,659.55|2,946,400,589.52|

||||||||
|-|-|-|-|-|-|-|
||Opening balance||||||
|Subsidiary||Non-current|||Non-current||
||Current assets||Total assets|Current liability||Total liability|
|||assets|||liability||
|Weifu Jinning|804,641,137.00|337,158,270.17|1,141,799,407.17|245,091,101.59|54,199,342.64|299,290,444.23|

||||||||
|-|-|-|-|-|-|-|
|Weifu Schmidt|88,975,034.68|33,405,432.30|122,380,466.98|93,741,159.45||93,741,159.45|
|Weifu Leader|2,392,378,693.81|978,224,529.85|3,370,603,223.66|1,793,072,212.90|23,503,280.34|1,816,575,493.24|
|Weifu Tianli|290,628,819.00|243,156,899.42|533,785,718.42|259,270,617.16|63,076,581.29|322,347,198.45|
|Weifu Autocam|250,884,987.49|216,134,430.81|467,019,418.30|169,012,066.26||169,012,066.26|
|Total|3,827,508,671.98|1,808,079,562.55|5,635,588,234.53|2,550,187,157.36|150,779,204.27|2,700,966,361.63|

 In RMB
||||||
|-|-|-|-|-|
||Current period||||
|Subsidiary|||||
||Operation Income|Net profit|Total comprehensive income|Cash flow from operation activity|
|Weifu Jinning|345,257,893.56|70,230,711.18|70,230,711.18|34,921,442.31|
|Weifu Schmidt|90,961,973.06|304,135.67|304,135.67|11,277,941.76|
|Weifu Leader|1,589,176,188.66|76,364,083.43|76,364,083.43|-19,011,866.15|
|Weifu Tianli|196,673,863.48|8,293,196.15|8,293,196.15|-9,491,657.17|
|Weifu Autocam|234,675,435.40|22,670,547.15|22,670,547.15|3,466,284.14|
|Total|2,456,745,354.16|177,862,673.58|177,862,673.58|21,162,144.89|

||||||
|-|-|-|-|-|
||Last period||||
|Subsidiary|||||
||Operation Income|Net profit|Total comprehensive income|Cash flow from operation activity|
|Weifu Jinning|320,793,577.32|75,554,314.01|75,554,314.01|51,524,867.08|
|Weifu Schmidt|63,231,942.41|-523,081.90|-523,081.90|-3,177,601.27|
|Weifu Leader|1,397,383,244.81|87,593,822.47|87,593,822.47|83,180,660.24|
|Weifu Tianli|160,306,384.47|804,668.07|804,668.07|7,731,426.95|
|Weifu Autocam|258,060,091.53|46,391,372.85|46,391,372.85|18,287,063.55|
|Total|2,199,775,240.54|209,600,886.31|209,600,886.31|158,446,533.01|

 (4) Significant restrictions on the use of enterprise group assets and pay off debts of the enterprise group Nil
(5) Financial or other supporting offers to the structured entity included in consolidated financial statement range
Nil
2. Transaction that has owners equity shares changed in subsidiary but still with controlling rights
Nil
3. Equity in joint venture and cooperative enterprise
(1) Important joint venture and cooperative enterprise
||||||||
|-|-|-|-|-|-|-|
|||Registeredplace||Share-holding ratio||Accounting|
|||||||treatment on|
||Main||||||
|||||||investment for|
|Name|operation||Business nature||Indirectl||
|||||Directly||joint venture and|
||place||||y||
|||||||cooperative|
|||||||enterprise|
|I. Joint venture|||||||
|Wuxi Weifu Environment Catalyst Co.,|||||||
||Wuxi|Wuxi|Catalyst||49.00%|Equity method|
|Ltd.|||||||
|II. Cooperative enterprise|||||||
||||Internal||||
|Bosch Automobile Diesel System Co.,|||combustion||||
||Wuxi|Wuxi||32.50%|1.50%|Equity method|
|Ltd.|||engine and||||
||||attachment||||
||||Internal||||
||||combustion||||
|Zhonglian Automobile Electronic Co., Ltd|Shanghai|Shanghai||20.00%||Equity method|
||||engine and||||
||||attachment||||
||||Internal||||
|Weifu Precision Machinery|||combustion||||
||Wuxi|Wuxi||20.00%||Equity method|
|Manufacturing Co., Ltd.|||engine and||||
||||attachment||||

Holding shares ratio different from the voting right ratio: Nil
Has major influence with less20% voting rights hold, or has minor influence with over20%(20% included) voting rights hold: Nil (2) Main financial information of the important joint venture
In RMB
||||
|-|-|-|
||Closing balance /Current period|Opening balance /Last period|
||Weifu Environment|Weifu Environment|
|Current assets|3,284,020,160.10|3,011,258,785.42|
|Including: cash and cash equivalents|278,457,844.16|120,584,888.35|
|Non -current assets|290,878,020.94|284,089,421.89|
|Total assets|3,574,898,181.04|3,295,348,207.31|
|Current liabilities|2,400,664,228.68|2,211,790,474.13|
|Non –current liabilities|19,672,000.00|16,450,000.00|

||||
|-|-|-|
|Total liabilities|2,420,336,228.68|2,228,240,474.13|
|Shareholders’ equity attributable to parent company|1,154,561,952.36|1,067,107,733.18|
|Share of net assets calculated by shareholding ratio|565,735,356.67|522,882,789.26|
|Book value of equity investment in joint ventures|565,735,356.67|522,882,789.26|
|Operation income|1,864,398,010.43|1,571,581,523.69|
|Financial expense|47,189,696.29|30,728,151.56|
|Income tax expense|3,251,620.98|17,908,910.36|
|Net profit|92,057,072.82|90,618,512.17|
|Total comprehensive income|92,057,072.82|90,618,512.17|

 (3) Main financial information of the important cooperative enterprise
In RMB
||||||||
|-|-|-|-|-|-|-|
||Closing balance /Current period|||Opening balance /Last period|||
||Bosch Diesel|Zhonglian|Weifu Precision|Bosch Diesel|Zhonglian|Weifu Precision|
||System|Automobile|Machinery|System|Automobile|Machinery|
|Current assets|9,675,155,533.63|1,346,012,502.62|269,283,814.39|8,194,014,833.80|688,116,022.56|238,511,756.68|
|Non -current|||||||
||2,449,077,752.32|4,519,310,194.86|127,131,232.18|2,696,164,046.92|4,668,848,226.74|123,616,959.50|
|assets|||||||
|Total assets|12,124,233,285.95|5,865,322,697.48|396,415,046.57|10,890,178,880.72|5,356,964,249.30|362,128,716.18|
|Current liabilities|4,894,935,119.46|1,212,230,464.04|112,123,028.11|3,949,654,684.13|566,609,302.26|112,597,321.52|
|Non –current|||||||
|||2,186,640.00|||2,210,310.00||
|liabilities|||||||
|Total liabilities|4,894,935,119.46|1,214,417,104.04|112,123,028.11|3,949,654,684.13|568,819,612.26|112,597,321.52|
|Attributable to|||||||
|parent company|||||||
||7,229,298,166.49|4,650,905,593.44|284,292,018.46|6,940,524,196.59|4,788,144,637.04|249,531,394.66|
|shareholders’|||||||
|equity|||||||
|Share of net|||||||
|assets calculated|||||||
||2,457,961,376.61|930,181,118.68|56,858,403.69|2,359,778,226.84|957,628,927.40|49,906,278.93|
|by shareholding|||||||
|ratio|||||||
|--Goodwill|267,788,761.35|1,407,265.96||267,788,761.35|1,407,265.96||
|--Unrealized|||||||
|profit of internal|-18,110,561.77||-36,495.80|-18,770,053.91||-28,335.94|
|trading|||||||
|--Other|-0.28||-529,034.03|-0.28||-529,034.03|
|Book value of|||||||
||2,707,639,575.91|931,588,384.64|56,292,873.86|2,608,796,934.00|959,036,193.36|49,348,908.96|
|equity investment|||||||

||||||||
|-|-|-|-|-|-|-|
|in joint ventures|||||||
|Operation income|8,713,485,959.51|12,091,114.45|190,093,280.56|7,780,712,323.52|8,953,773.36|120,872,329.06|
|Net profit|2,076,330,091.90|1,059,760,956.40|34,760,623.80|1,750,186,156.84|980,886,111.95|17,474,566.01|
|Total|||||||
|comprehensive|2,076,330,091.90|1,059,760,956.40|34,760,623.80|1,750,186,156.84|980,886,111.95|17,474,566.01|
|income|||||||
|Dividends|||||||
|received from|||||||
||303,884,540.74|||318,528,894.62|||
|joint venture in|||||||
|the year|||||||

(4) Financial summary for non-important Joint venture and affiliate enterprise
Nil
(5) Major limitation on capital transfer ability to the Company from joint venture or affiliates
Nil
(6) Excess loss occurred in joint venture or affiliates
Nil
(7) Unconfirmed commitment with joint venture investment concerned
Nil
(8) Intangible liability with joint venture or affiliates investment concerned
Nil
4. Major conduct joint operation
Nil
5. Structured body excluding in consolidate financial statement
Nil
6. Other
Nil
X. Risk related with financial instrument
Main financial instrument of the Company including equity investment, loans, account receivable, account payable etc., more details of the financial instrument can be found in relevant items of Note VII. Risks concerned with the above mentioned financial instrument, and the risk management policy takes for lower the risks are as follow:
Aims of engaging in the risk management is to achieve equilibrium between the risk and benefit, lower the adverse impact on performance of the Company to minimum standards, and maximized the benefit for shareholders and other investors. Base on the risk management targets, the basic tactics of the risk management is to recognized and analyzed the vary risks that the Company counted, established an appropriate risk exposure baseline and caring risk management, supervise the vary risks timely and reliably in order to control the risk in a limited range.
In business process, the risks with financial instrument concerned happen in front of the Company mainly including credit exposure, market risk and liquidity risk. BOD of the Company takes full charge of the risk management target and policy-making, and takes ultimate responsibility for the target of risk management and policy. Risk management department and financial control department manager and monitor those risk exposure to ensuring the risks are control in a limited range.
1. Credit Risk
Credit risk refers to the one party fails to perform the obligation of the financial instruments, form the other party company mainly face credit risk for financial loss caused by the customer credit risks. In order to prevent the risks, the Company formulated an evaluation system for the newclient’s credit and system to analyze the book credit for regular customer. The evaluation system for the newclient’s credit aims at the new clients, the Company will conduct an background investigation based on the established process, with purpose of determine whether offer credit limit to the client and the amount of the credit and credit terms or not. Whereby, the Company setting a credit limits and credit period for every new client, and such limit is the maximum amount without additional approval. The system to analyze the book credit for regular customer refers to after purchase order received by regular customer, the Company will examine the order amount and outstanding balance, if the total over the credit limit, on the premise of additional approval, sales on account shall be realized, or prepayments for relevant amount shall be required.
Furthermore, as for the sales on account occurred, the Company will guarantee the total credit risks in a controlling range by analyzed and review the monthly report of the risk attention for account receivables.
The maximum credit risk exposure of the Company is the book amount of such financial assets, till end of 30 June 2018; lists of the maximum credit risk exposure of the Company are as:
||||
|-|-|-|
|Item|Amount of merge|Amount of parent company|
|Accounts receivable|2,374,955,337.33|1,003,118,142.78|
|Other receivables|17,839,885.07|178,153,549.80|

2. Market risk
Market risk of the financial instrument refers to the fair value of financial instrument or future cash flow due to
fluctuations in the market price changes and produce, mainly includes the IRR, FX risk and other price risk. (1) Interest rate risk (IRR)
IRR refers to the fluctuate risks onCompany’s financial status and cash flow arising from rates changes in market. IRR of the Company mainly related with the bank loans. In order to lower the fluctuate of IRR, the Company, in line with the anticipative change orientation, choose floating rate or fixed rate, that is the rate in future period will goes up prospectively, than choose fixed rate; if the rate in future period will decline prospectively, than choose the floating rate. In order to minor the bad impact from difference between the expectation and real condition, loans for liquid funds of the Company are choose the short-term period, and agreed the terms of prepayment in particular.
(2) Foreign exchange (FX) risk
FX risks refer to the losses arising from exchange rate movement. The FX risk sustain by the Company mainly related with the USD, EUR, SF, JPY and GBP, except for the USD, EUR, SF and JPY carried out for the equipment purchasing of parent company and Autocam, material purchasing from business section of Weifu Diesel System, technical service and trademark usage costs from business section of Weifu Diesel System and the import and export of Weifu International Trade, other main business of the Company are pricing and settle with RMB (Yuan). In consequence of the foreign financial assets and liabilities takes minor ratio in total assets, the Company has small FX risk of the financial instrument, considered by management of the Company.
End as 30 June 2018, except for the follow assets or liabilities listed with foreign currency, assets and liabilities of the Company are carried with RMB
1. Foreign currency assets of the Company till end of 30 June 2018:
||||||
|-|-|-|-|-|
|Item|Ending foreigncurrency balance|Convert rate|Ending RMB balanceconverted|Ratio in assets|
|Monetary fund|||||
|Including: USD|15,019,676.83|6.6166|99,379,193.71|0.45%|
|EUR|1,959,035.57|7.6515|14,989,560.66|0.07%|
|JPY|9,248,508.00|0.059914|554,115.12||
|HKD|9,178,111.52|0.8431|7,738,065.82|0.04%|
|Accounts receivable|||||
|Including: USD|4,805,349.78|6.6166|31,795,077.36|0.15%|
|EUR|968,745.75|7.6515|7,412,358.10|0.03%|
|JPY|11,348,905.00|0.059914|679,958.29||
|Total ratio in assets||||0.74%|

 2. Foreign currency liabilities of the Company till end of 30 June 2018:
||||||
|-|-|-|-|-|
|Item|Ending foreigncurrency balance|Convert rate|Ending RMB balanceconverted|Ratio in liabilities|
|Accounts payable|||||
|Including: USD|673,126.61|6.6166|4,453,809.52|0.07%|
|EUR|1,597,806.15|7.6515|12,225,613.75|0.20%|

||||||
|-|-|-|-|-|
|CHF|20,630.15|6.6350|136,881.05||
|JPY|94,543,893.00|0.059914|5,664,502.81|0.09%|
|Total ratio inliabilities||||0.36%|

(3) Other pricing risk
Classification of the Company held is the equity investments in financial assets available for sale, and such investment can be measured by fair value on balance sheet date, thus, the Company owns a risk of stock market changes.
Furthermore, on the premise of deliberated and approved in 5th meeting of 8th session of the Board, the Company exercise entrust financing with the self-owned idle capital; therefore, the Company has the risks of collecting no principal due to entrust financial products default. Aims at such risk, the Company formulated a “Management Mechanism of Capital Financing”, and well-defined the authority approval, investment decision-making, calculation management and risk controls for the entrust financing in order to guarantee a security funds and prevent investment risk efficiently. In order to lower the adverse impact from unpredictable factors, the Company choose short-term and medium period for investment and investmentproduct’s term is up to 3 years in principle; in variety of investment, the Company did not invested for the stocks, derivative products, security investment fund and the entrust financial products aims at security investment as well as other investment with securities concerned.
3. Liquidity risk
Liquidity risk refers to the capital shortage risk occurred during the clearing obligation implemented by the enterprise in way of cash paid or other financial assets. The Company aims at guarantee the Company has rich capital to pay the due debts, therefore, a financial control department is established for collectively controlling such risks. On the one hand, the financial control department monitoring the cash balance, the marketable securities which can be converted into cash at any time and the rolling forecast on cash flow in future 12 months, ensuring the Company, on condition of reasonable prediction, owes rich capital to paid the debts; on the other hand, building a favorable relationship with the banks, rationally design the line of credit, credit products and credit terms, guarantee a sufficient limit for bank credits in order to satisfy vary short-term financing requirements.
XI. Disclosure of fair value
1. Ending fair value of the assets and liabilities measured by fair value
In RMB
||||||
|-|-|-|-|-|
||Ending fair value||||
|Item|||||
||First-order|Second-order|Third-order|Total|
|I. Sustaining measured by fair value|--|--|--|--|
|(2) Equity instrument investment|178,332,264.00|||178,332,264.00|
|Total assets sustaining measured by fair value|178,332,264.00|||178,332,264.00|
|II. Non-persistent measure|--|--|--|--|

XII. Related party and related transactions
1. Parent company of the enterprise
|||||||
|-|-|-|-|-|-|
|||||Share-holding ratio|Voting right ratio onthe enterprise|
|Parent company|Registration place|Business nature|Registered capital|on the enterprise for||
|||||parent company||
|Wuxi Industry||Operation of||||
||Wuxi||3,720,671,000 Yuan|20.22%|20.22%|
|Group||state-owned assets||||

Explanation on parent company of the enterprise
Wuxi Industry Development Group Co., Ltd was solely state-owned enterprise funded and established by Wuxi MunicipalPeople’s Government which mainly took responsibility of authorizing the state-owned assets operation within a certain areas, investment management of significant project, investment and development of manufacturing and services and venture capital in high-tech achievement
Ultimate controller of the Company is State-owned Assets Supervision& Administration Commission of Wuxi Municipality of Jiangsu Province.
2. Subsidiary of the Enterprise
Found more in Note IX. 1.” Equity in subsidiary”
3. Cooperative enterprise and joint venture
Found more in Note IX.3. “Equity in joint venture and cooperative enterprise”
Other cooperative enterprise or joint ventures which has related transaction with the Company in the period or occurred previous: Nil 4. Other related party
|||
|-|-|
|Other related party|Relationship with the Enterprise|
|ROBERT BOSCH GMBH|The second largest shareholder of the Company|
|Key executive|Director, supervisor and senior executive of the Company|

 5. Related transaction
(1) Goods purchasing, labor service providing and receiving
Goods purchasing/labor service receiving
In RMB
|||||||
|-|-|-|-|-|-|
||||Approved transaction|Whether more thanthe transaction limit||
|Related party|Content|Current period|||Last period|
||||limit|||
|Weifu Precision||||||
||Goods and labor|22,934,380.54|50,000,000.00|No|20,428,172.03|
|Machinery||||||

|||||||
|-|-|-|-|-|-|
|Bosch Diesel||||||
||Goods and labor|29,375,329.74|70,000,000.00|No|101,905,922.60|
|System||||||
|Weifu Environment|Goods|946,283,103.47|1,925,000,000.00|No|683,351,475.87|
|ROBERT BOSCH||||||
||Goods|62,350,113.72|143,000,000.00|No|77,035,723.88|
|GMBH||||||

Goods sold/labor service providing
In RMB
|||||
|-|-|-|-|
|Related party|Content|Current period|Last period|
|Weifu Precision Machinery|Goods and labor|2,772,785.47|1,816,410.96|
|Bosch Diesel System|Goods and labor|1,600,013,496.75|1,684,350,434.59|
|Weifu Environment|Goods and labor|28,741,766.37|37,016,920.13|
|ROBERT BOSCH GMBH|Goods and labor|319,461,744.57|1,583,518.80|

 (2) Related trusteeship management/contract& entrust management/ outsourcing
Nil
(3) Related lease
As a lessor for the Company:
In RMB
|||||
|-|-|-|-|
|Lessee|Assets type|Lease income in recognized in the Period|Lease income in recognized last the Period|
|Weifu Environment|Workshop|1,254,028.50|1,194,313.00|

 As a tenant: Nil
Explanation on related lease
Weifu Leader entered into the house leasing contract with Weifu Environment, as for the plant locates at No.9 Linjiang Road, Wuxi new district, owed by Weifu Leader, rent-out to Weifu Environment, agreements are made as: Rental from 1 January 2017 to 31 December 2017 was 2,388,626.00 Yuan
(4) Related guarantee
Nil
(5) Relatedparty’s borrowed funds
Nil
(6) Relatedparty’s assets transfer and debt reorganization
Nil
(7) Remuneration of key manager
In RMB
||||
|-|-|-|
|Item|Current period|Last period|
|Remuneration of key manager|2,400,000.00|2,310,000.00|

 (8) Other related transactions
|||||
|-|-|-|-|
|Item|Related party|Current period|Last period|
|Fixed assets purchased|Bosch Diesel System|42,735.04||
|Technology royalties paid etc.|ROBERT BOSCHGMBH|2,805,114.55|2,468,484.66|

6. Receivable/payable items of related parties
(1) Receivable item
In RMB
|||||||
|-|-|-|-|-|-|
|||Closing balance||Opening balance||
|Item|Related party|||||
|||Book balance|Bad debt reserves|Book balance|Bad debt reserves|
|Account receivable|Weifu Precision Machinery|34,405.50||425,363.64||
|Account receivable|Bosch Diesel System|611,995,184.24||615,770,490.57|72,188.07|
|Account receivable|ROBERT BOSCH GMBH|96,482,607.56||||
|Account receivable|Weifu Environment|6,050,093.98||710,200.00||
|Other non-current||||||
||Bosch Diesel System|||877,500.00||
|assets||||||

(2) Payable item
In RMB
|||||
|-|-|-|-|
|Item|Related party|Ending book balance|Opening book balance|
|Account payables|Weifu Precision Machinery|13,680,801.84|9,737,530.74|
|Account payables|Weifu Environment|723,117,682.74|379,374,827.01|
|Account payables|Bosch Diesel System|14,183,956.17|44,262,749.15|
|Account payables|ROBERT BOSCH GMBH|1,987,967.11|38,202,192.76|
|Account received in advance|ROBERT BOSCH GMBH||579,650.36|
|Account received in advance|Weifu Environment|5,850,143.44|6,514,951.87|
|Other accounts payable|Industry Group|5,470,000.00||

7. Commitments of related party
Nil
8. Other
Nil
XIII. Share-based payment
Nil
XIV. Commitment or contingency
1. Important commitments
Important commitments in balance sheet date
Nil
2. Contingency
(1) Contingency on balance sheet date
Guarantees to subsidiary
||||||||
|-|-|-|-|-|-|-|
|Guarantee provided|Guaranteereceived|Debit bank|Guaranteeamount (in10 thousandYuan)|Starting from|Terminateddated|Whetherguaranteeimplementedor not|
|Weifu High-Technology GroupCo., Ltd.|Weifu Tianli|Jiangbei branch ofBank of China inNingbo|5,000.00|2016-11-15|2021-11-10|N|

(2) For the important contingency not necessary to disclosed by the Company, explained reasons
The Company has no important contingency that need to disclosed
XV. Events after balance sheet date
1. Important non adjustment matters
Nil
2. Profit distribution
In RMB
|||
|-|-|
|Profit or dividend plans to distributed|1,210,740,700.00|
|Profit or dividend declare to distributed which have been approved|1,210,740,700.00|

 3. Sales return
Nil
4. Other events after balance sheet date
Nil
XVI. Other important events
1. Previous accounting errors collection
Nil
2. Debt restructuring
Nil
3. Assets replacement
Nil
4. Pension plan
The “Enterprise Annuity Plan under the name of WFHT” has deliberated and approved by 8th meeting of 7th session of the Board: in order to mobilize the initiative and creativity of the employees, established a talent long-term incentive mechanism, enhance the cohesive force and competitiveness in enterprise, the Company carried out the above mentioned annuity plan since the date of reply of plans reporting received from labor security administration department. Annuity plans are: the annuity fund are paid by the enterprise and employees together; the amount paid by enterprise shall not over the 1/12 of the total salary of last years, amount paid by individual and enterprise shall not over the 1/6 of the total salary of last year, in accordance with theState’s annuity policy, the Company will adjusted the economic benefits in due time, in principle of responding to the economic strength of the enterprise, the amount paid by the enterprise at current period control in the 8.33 percent of the total salary of last year, specific paying ratio later shall be adjust correspondingly in line with the operation condition of the Company.
In December 2012, the Company received the “Reply on annuity plans reporting under the name of WFHT” from
labor security administration department, later, the Company entered into the “Entrusted Management Contract of
the Annuity Plan of WFHT” with PICC.
5. Discontinued operations
Nil
6. Segment
(1) Recognition basis and accounting policy for reportable segment
Determine the operating segments in line with the internal organization structure, management requirement and internal reporting system. Operating segment of the Company refers to the followed components that have been satisfied at the same time:
①the component is able to generate revenues and expenses in routine activities;
②management of the Company is able to assess the operation results regularly, and determine resources allocation and performance evaluation for the component;
③being analyzed, financial status, operation results and cash flow of the components are able to required by the Company
The Company mainly engaged in the manufacture of fuel system of internal combustion engine products, auto parts, muffler and purifier etc., based on the product segment, the Company determine three reporting segment as auto fuel injection system, air intake system and car after-treatment system. Accounting policy for the three reporting segments are shares the same policy state in Note III
Segment assets exclude financial assets through profit or loss at fair value, derivative instruments, dividends receivables, interest receivables, financial management products due within one year, financial assets available for sale, long term equity investment and other undistributed assets, since these assets are not related to products operation.
(2) Financial information for reportable segment
In RMB
||||||||
|-|-|-|-|-|-|-|
|||||Add:|||
|||||investment/incom|||
|||||e measured by|||
|||||equity, income of|||
|||||financial products|||
|||||or possession and|||
||||Product segment of||||
||Product segment of|Product segment of||disposal income,|||
||||automotive||||
|Item|automotive fuel|automotive air||the retained assets|Offset of segment|Total|
||||post-processing||||
||injection system|intake system||or gains/losses as|||
||||system||||
|||||the financial|||
|||||assets available|||
|||||for sale or|||
|||||possession and|||
|||||disposal income|||

||||||||
|-|-|-|-|-|-|-|
|Operating|||||||
||3,102,531,936.37|1,702,505,894.52|276,835,296.54||121,071,236.44|4,960,801,890.99|
|revenue|||||||
|Operating|||||||
||2,267,395,464.33|1,540,041,366.60|203,224,695.20||121,071,236.44|3,889,590,289.69|
|cost|||||||
|Total profit|470,140,658.42|40,905,079.54|20,795,469.62|1,149,033,168.39||1,680,874,375.97|
|Net profit|401,324,005.53|34,550,600.44|19,615,170.77|1,122,457,301.27||1,577,947,078.01|
|Total assets|9,112,788,174.84|2,954,472,168.12|797,969,043.92|9,278,108,867.85|222,549,411.87|21,920,788,842.86|
|Total|||||||
||4,095,612,976.11|1,913,172,789.96|480,969,210.37|5,094,154.34|205,293,181.88|6,289,555,948.90|
|liabilities|||||||

(3) If there are no segment in the Company, or the total assets and liabilities of the segment are un-able to disclosed, explain the reasons
Not applicable
(4) Other notes
Nil
7. Major transaction and events makes influence oninvestor’s decision
Nil
8. Other
Nil
XVII. Principle notes of financial statements of parent company
1. Accounts receivable
(1) Category
In RMB
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
||Closing balance|||||Opening balance|||||
||Book balance||Bad debt reserves|||Book balance||Bad debt reserves||Book value|
|Types|||||Book||||||
||||Amount|Accrual|||||Accrual||
||Amount|Ratio|||value|Amount|Ratio|Amount|||
|||||ratio|||||ratio||
|Receivables with bad|1,006,269,116.34||3,150,973.56|||||2,477,035.41||1,047,012,889.92|
|||||||1,049,4|||||
|debt provision|||||1,003,118||||||
|||100.00%||0.31%||89,925.|100.00%||0.24%||
|accrual by credit|||||,142.78||||||
|||||||33|||||
|portfolio|||||||||||
|Total|1,006,26|100.00%|3,150,97|0.31%|1,003,118|1,049,4|100.00%|2,477,035|0.24%|1,047,012,8|

|||||||
|-|-|-|-|-|-|
|9,116.34|3.56|,142.78|89,925.|.41|89.92|
||||33|||

Account receivable with single significant amount and withdrawal bad debt provision separately at period end :
□ Applicable√ Not applicable
Account receivable provided for bad debt reserve under aging analysis method in the groups:
√ Applicable□ Not applicable
In RMB
|||||
|-|-|-|-|
||Closing balance|||
|Age||||
||Account receivable|Bad debt reserves|Accrual ratio|
|Subitem of within one year||||
|Within 6 months|787,013,605.57|||
|6 months to one year|10,781,166.25|1,078,116.64|10.00%|
|Subtotal within one year|797,794,771.82|1,078,116.64||
|1-2 years|943,376.16|188,701.22|20.00%|
|2-3 years|1,091,364.56|436,545.82|40.00%|
|Over 3 years|1,447,609.88|1,447,609.88|100.00%|
|Total|801,277,122.42|3,150,973.56|0.39%|

 Explanations on combination determine:
Except for the receivables with impairment reserves accrual singly; base on the actual loss ratio of the receivables of previous years, with same or similar credit portfolio, and combining actual condition accrual bad debt reserves to determined the accrual ratio for bad debt reserves
In combination, withdrawal bad debt provision based on balance proportion for account receivable:
□ Applicable√ Not applicable
In combination, withdrawal bad debt provision based on other methods for account receivable:
Combination of related party
||||
|-|-|-|
|Related party|Amount|Proportion of the bad debtprovision withdrawal (%)|
|Weifu Leader|37,319,951.85|--|
|Weifu ITM|56,016,233.09|--|
|Weifu Autocam|8,405,583.57|--|
|Weifu International Trade|98,113,836.09|--|
|Weifu Tianli|1,441,969.98|--|
|Weifu Schmidt|3,694,419.34|--|
|Total|204,991,993.92|--|

(2) Bad debt provision accrual, collected or reversed
Accrual bad debt provision 678,845.55 Yuan; collected or reversed 0.00 Yuan.
Including major amount collected or reversed in the period: Nil
(3) Receivables actually written-off during the reporting period
In RMB
|||
|-|-|
|Item|Written-off amount|
|Other small companies|4,907.40|

 Important receivables written-off: nil
Explanation: the account was not occurred from related transaction
(4) Top 5 receivables at ending balance by arrears party
Total receivables collected by arrears party for the Period amounting to 852,601,230.38 Yuan, takes 84.73 percent in closing balance of the account receivables; 118,908.79 Yuan are accrual correspondingly for bad debt reserves. (5) Account receivable derecognition due to financial assets transfer
Nil
(6) Assets and liabilities resulted by account receivable transfer and continues involvement
Nil
2. Other accounts receivable
(1) Classification
In RMB
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
||Closing balance|||||Opening balance|||||
||Book balance||Bad debt reserves|||Book balance||Bad debt reserves|||
|Type|||||Book||||||
|||||Accrual|||||Accrual|Book value|
||Amount|Ratio|Amount||value|Amount|Ratio|Amount|||
|||||ratio|||||ratio||
|Other receivable with|||||||||||
|single significant|||||||||||
||178,164,||10,457.0||178,153,5|50,395,||220,680.1||50,174,653.|
|amount and||100.00%||0.01%|||100.00%||0.44%||
||006.82||2||49.80|333.34||8||16|
|withdrawal bad debt|||||||||||
|provision separately|||||||||||
||178,164,||10,457.0||178,153,549.80|50,395,||220,680.1||50,174,653.16|
|Total||100.00%||0.01%|||100.00%||0.44%||
||006.82||2|||333.34||8|||

Other receivable with single significant amount and withdrawal bad debt provision separately at end of period:
□ Applicable√ Not applicable
In combination, other accounts receivable whose bad debts provision was accrued by age analysis:
√ Applicable□ Not applicable
In RMB
|||||
|-|-|-|-|
||Closing balance|||
|Age||||
||Other receivable|Bad debt reserves|Accrual ratio|
|Subitem of within one year||||
|Within 6 months|12,270,196.99|||
|6 months to one year|104,570.21|10,457.02|10.00%|
|1-2 years|12,374,767.20|10,457.02||
|Total|12,374,767.20|10,457.02|0.08%|

 Explanations on combination determine:
Except for the other receivables with impairment reserves accrual singly; base on the actual loss ratio of the receivables of previous years, with same or similar credit portfolio, and combining actual condition accrual bad debt reserves to determined the accrual ratio for bad debt reserves
In combination, withdrawal bad debt provision based on balance proportion for other account receivable
□ Applicable√ Not applicable
In combination, withdrawal bad debt provision based on other methods for other account receivable
√Applicable□ Not applicable
Combination of related party
||||
|-|-|-|
|Related party|Amount|Proportion of the bad debtprovision withdrawal|
|Weifu Chang’an|20,000,000.00||
|Weifu Mashan|21,789,239.62||
|Weifu Leader|100,000,000.00||
|Weifu Schmidt|24,000,000.00||
|Total|165,789,239.62||

(2) Bad debt provision accrual, collected or reversed
Accrual bad debt provision 8,405.53 Yuan; collected or reversed 218,628.69 Yuan.
Including major amount collected or reversed in the period: nil
(3) Other receivables actually written-off during the reporting period: Nil
(4) Other receivables by nature
In RMB
||||
|-|-|-|
|Nature|Ending book balance|Opening book balance|
|Staff loans and petty cash|2,193,166.13|1,438,626.00|
|Balance of related party within the scope of the merger|165,789,239.62|47,000,000.00|
|Current money with the enterprises|10,174,401.07|1,949,507.34|
|Other|7,200.00|7,200.00|
|Total|178,164,006.82|50,395,333.34|

 (5) Top 5 other receivables at ending balance by arrears party
In RMB
|||||||
|-|-|-|-|-|-|
|||||Ratio in total ending||
||||||Ending balance of|
|Company|Nature|Ending balance|Book age|balance of other||
||||||bad bet provision|
|||||receivables||
||Current money with|||||
|Weifu Leader||100,000,000.00|Within one year|56.13%||
||the subsidiary|||||
||Current money with|||||
|Weifu Schmidt||24,000,000.00|Within one year|13.47%||
||the subsidiary|||||
||Current money with|||||
|Weifu Mashan||21,789,239.62|Within one year|12.23%||
||the subsidiary|||||
||Current money with|||||
|Weifu Chang’an||20,000,000.00|Within one year|11.23%||
||the subsidiary|||||
|Baodun (Tianjin)|Current money with|||||
|||10,000,000.00|Within one year|5.61%||
|Electrical Co., Ltd.|the enterprises|||||
|Total|--|175,789,239.62|--|98.67%||

(6) Account receivable with government grand involved
Nil
(7) Other account receivable derecognition due to financial assets transfer
Nil
(8) Assets and liabilities resulted by other account receivable transfer and continues involvement
Nil
3. Long-term equity investment
In RMB
||||||||
|-|-|-|-|-|-|-|
||Closing balance|||Opening balance|||
|Item|||||||
||Book balance|Impairment|Book value|Book balance|Impairment|Book value|
|Investment for|||||||
||1,466,611,689.17||1,466,611,689.17|1,451,041,689.17||1,451,041,689.17|
|subsidiary|||||||
|Investment for|||||||
|associates and joint|3,585,913,387.21||3,585,913,387.21|3,511,481,000.32||3,511,481,000.32|
|venture|||||||
|Total|5,052,525,076.38||5,052,525,076.38|4,962,522,689.49||4,962,522,689.49|

 (1) Investment for subsidiary
In RMB
||||||||
|-|-|-|-|-|-|-|
|||||||Ending balance of|
||||||Impairment||
|The invested entity|Opening balance|Increased|Decreased|Ending balance||impairment|
||||||accrual||
|||||||provision|
|Weifu Jinning|178,639,593.52|||178,639,593.52|||
|Weifu Leader|460,113,855.00|||460,113,855.00|||
|Weifu Mashan|168,693,380.51|||168,693,380.51|||
|Weifu Chang’an|220,902,037.30|||220,902,037.30|||
|Weifu|||||||
||32,849,254.85|||32,849,254.85|||
|International Trade|||||||
|Weifu ITM|167,000,000.00|||167,000,000.00|||
|Weifu Schmidt|50,160,000.00|||50,160,000.00|||
|Weifu Tianli|90,229,100.00|15,570,000.00||105,799,100.00|||
|Weifu Autocam|82,454,467.99|||82,454,467.99|||
|Total|1,451,041,689.17|15,570,000.00||1,466,611,689.17|||

(2) Investment for associates and joint venture
In RMB
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
|||+,-||||||||||
|||||Investme||||Impairment accrual|||Ending|
||||||Other||Cash|||||
|||||nt|||||||balance|
|||Additiona|||comprehe||dividend|||||
||Opening|||gains/loss||Other||||Ending|of|
|Company||l|Capital||nsive||or profit|||||
||balance|||es||equity|||Other|balance|impairme|
|||investmen|reduction||income||announce|||||
|||||recognize||change|||||nt|
|||t|||adjustmen||d to|||||
|||||d under|||||||provision|
||||||t||issued|||||
|||||equity||||||||
|I. Joint venture||||||||||||

||||||
|-|-|-|-|-|
|II. Associated enterprise|||||
|Bosch|||||
||2,503,154|675,879,1|580,955,7|2,598,078|
|Diesel|||||
||,814.59|64.22|39.65|,239.16|
|System|||||
|Zhonglian|||||
|Automobi|||||
||959,036,1|211,952,1|239,400,0|931,588,3|
|le|||||
||93.36|91.28|00.00|84.64|
|Electronic|||||
|Co., Ltd|||||
|Weifu|||||
|Precision|49,289,99|6,956,771||56,246,76|
|Machiner|2.37|.04||3.41|
|y|||||
||3,511,481|894,788,1|820,355,7|3,585,913|
|Subtotal|||||
||,000.32|26.54|39.65|,387.21|
||3,511,481,000.32|894,788,1|820,355,7|3,585,913,387.21|
|Total|||||
|||26.54|39.65||

(3) Other explanation
In accordance with the resolution of Office Meeting 2017 No.(002), the6.29% shares of Weifu Tianli held by Ningbo Shenhua Energy-Saving and Enviornmental Protection Tech. Co., Ltd. are acquired in the Year, after acquisition, shares of Weifu Tianli held by the Company increased to54.23%, and file in industry and commerce bureau on 8 May 2018.
4. Operating income and cost
In RMB
||||||
|-|-|-|-|-|
||Current period||Last period||
|Item|||||
||Income|Cost|Income|Cost|
|Main business|2,136,258,034.82|1,533,313,082.59|1,473,896,379.07|1,129,630,086.97|
|Other business|178,884,620.31|165,203,440.31|152,584,036.64|138,992,574.61|
|Total|2,315,142,655.13|1,698,516,522.90|1,626,480,415.71|1,268,622,661.58|

 5. Investment gains
In RMB
||||
|-|-|-|
|Item|Current period|Last period|
|Income of long-term equity investment calculated based on cost|62,418,400.00|949,835,680.00|
|Income of long-term equity investment calculated based on equity|894,788,126.54|767,309,765.64|

||||
|-|-|-|
|Investment income from period of holding|||
||3,220,575.00|235,500.00|
|the financial assets available for sale|||
|Investment income obtained from disposal of financial assets available|||
||17,370,816.75|24,625,516.88|
|for sale|||
|Entrust financial income|159,552,310.73|97,021,850.83|
|Gains/losses of equity liquidation||-8,261,290.60|
|Total|1,137,350,229.02|1,830,767,022.75|

 6. Other
Nil
XVIII. Supplementary Information
1. Current non-recurring gains/losses
√ Applicable□ Not applicable
In RMB
||||
|-|-|-|
|Item|Amount|Note|
|Gains/losses from the disposal of non-current asset|1,421,091.02||
|Governmental subsidy reckoned into current gains/losses (not including the subsidy|||
|enjoyed in quota or ration according to national standards, which are closely relevant to|17,700,030.17||
|enterprise’s business)|||
|Profit and loss of assets delegation on others’ investment or management|159,801,630.73||
|Held transaction financial asset, gains/losses of changes of fair values from transaction|||
|financial liabilities, and investment gains from disposal of transaction financial asset,|||
||17,370,816.75||
|transaction financial liabilities and financial asset available for sales, exclude the effective|||
|hedging business relevant with normal operations of the Company|||
|Switch-back of impairment of account receivable that practice impairment test independent|512,580.00||
|Other non-operating income and expenditure except for the aforementioned items|73,701.23||
|Less: Impact on income tax|29,876,415.88||
|Impact on minority shareholders’ equity|626,230.67||
|Total|166,377,203.35|--|

 Concerning the extraordinary profit (gain)/loss defined byQ&A Announcement No.1 on Information Disclosure for Companies Offering Their Securities to the Public --- Extraordinary Profit/loss, and the items defined as recurring profit (gain)/loss according to the lists of extraordinary profit (gain)/loss inQ&A Announcement No.1 on Information Disclosure for Companies Offering Their Securities to the Public --- Extraordinary Profit/loss, explain reasons
□ Applicable√ Not applicable
2. REO and earnings per share
|||||
|-|-|-|-|
|||Earnings per share||
||Weighted average|||
|Profits during report period|||Diluted EPS|
||ROE|Basic EPS (RMB/Share)||
||||(RMB/Share)|
|Net profits belong to common stock stockholders of the||1.53|1.53|
||9.92%|||
|Company||||
|Net profits belong to common stock stockholders of the||||
||8.85%|1.37|1.37|
|Company after deducting nonrecurring gains and losses||||

3. Difference of the accounting data under accounting rules in and out of China
(1) Difference of the net profit and net assets disclosed in financial report, under both IAS (International Accounting Standards) and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable√ Not applicable
(2) Difference of the net profit and net assets disclosed in financial report, under both foreign accounting rules and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable√ Not applicable
(3) Explanation on data differences under the accounting standards in and out of China; as for the differences adjustment audited by foreign auditing institute, listed name of the institute
Not applicable
4. Other
Nil
Section XI. Documents available for reference
I. Financial statement carrying the signatures and seals of person in charge of the company, principal of the accounting works and person in charge of accounting organ (accounting Supervisor);
II. Original documents of the Company and manuscripts of public notices that disclosed in the website Juchao (http://www.cninfo.com.cn) designated by CSRC in the report period;
III. Semi-Annual report published on China Securities Journal, Securities Times and Hong Kong Commercial Daily during the Period.
Board of Directors of
Weifu High-Technology Group Co., Ltd.
Chairman:
Chen Xuejun
28 August 2018