Nanjing Putian Telecommunications Co., Ltd.
Financial Report for the Six Months Ended 30 June 2014
I. Audit reports
Whether the semi-annual report was audited or not
□ Yes√ No
The financial report of this semi-annual report was unaudited
II. Financial statements
Units in Notes of Financial Statements is RMB
1、The Consolidated Statement Of Financial Position
Prepared by: NANJING PUTIAN TELECOMMUNICATIONS CO., LTD. 30 June 2014 Unit: RMB Yuan
||||
|-|-|-|
|Items|30 June 2014|31 December 2013|
|Current assets|||
|Monetary funds|373,421,559.18|430,024,326.63|
|Settlement provisions|||
|Capital lent|||
|Held for trading financial assets|||
|Notes receivable|15,775,288.49|21,919,480.05|
|Accounts receivable|916,224,218.74|789,984,001.55|
|Prepayments|36,217,980.91|33,144,854.82|
|Insurance receivable|||
|Reinsurance receivables|||
|Contract reserve of reinsurance|||
|receivable|||
|Interest receivable|||
|Dividend receivable|1,000,000.00|1,000,000.00|
|Other receivables|41,785,203.50|58,091,611.43|
|Purchase restituted finance|||
|asset|||
|Inventories|458,327,909.99|431,011,396.33|
|Long-term debt investment due|||
|within a year|||
|Other current assets|||
|Total current assets|1,842,752,160.81|1,765,175,670.81|
|Non-current assets|||
|Granted loans and advances|||
|Available-for-sale financial|||
|assets|||
|Held-to-maturity investments|||
|Long-term accounts receivable|||
|Long-term equity investments|185,263,840.00|190,546,965.84|
|Investment property|10,898,773.38|4,401,316.11|
|Fixed assets|112,029,232.36|106,610,502.71|
|Construction in progress|17,508,197.87|16,157,767.87|
|Construction materials|||
|Fixed assets held for disposal|||
|Productive biological assets|||
|Petrol assets|||
|Intangible assets|28,294,346.41|24,302,415.55|
|Development costs|||
|Goodwill|||
|Long-term prepayments|||
|Deferred tax assets|||
|Other non-current assets|||
|Total non-current assets|353,994,390.02|342,018,968.08|

||||
|-|-|-|
|Total assets|2,196,746,550.83|2,107,194,638.89|

 Legal Representative: Hong Wang Person in Charge of Accounting Works: Lian Shi Person in Charge of Accounting Department: Huizhen Qiu1、The Consolidated Statement Of Financial Position (continued)
Prepared by: NANJING PUTIAN TELECOMMUNICATIONS CO., LTD. 30 June 2014 Unit: RMB Yuan
||||
|-|-|-|
|Items|30 June 2014|31 December 2013|
|Current liabilities|||
|Short-term loans|485,000,000.00|462,000,000.00|
|Loan from central bank|||
|Absorbing deposit and interbank|||
|deposit|||
|Capital borrowed|||
|Tradable financial liabilities|||
|Notes payable|101,330,272.30|70,809,648.50|
|Accounts payable|992,343,742.16|955,777,528.37|
|Advances from customers|69,424,907.77|77,659,452.52|
|Selling financial asset of repurchase|||
|Commission charge and|||
|commission payable|||
|Accrued payroll|16,540,975.47|16,664,127.11|
|Taxes payable|-5,119,536.50|1,544,609.90|
|Interest payable|||
|Dividend payable|1,946,045.39|1,946,045.39|
|Other payables|59,219,908.35|52,249,025.93|
|Reinsurance payables|||
|Insurance contract reserve|||
|Security trading of agency|||
|Security sales of agency|||
|Long-term liabilities due within a|||
|year|||
|Other current liabilities|||
|Total current liabilities|1,720,686,314.94|1,638,650,437.72|
|Non-current liabilities|||
|Long-term borrowings|||
|Bonds payable|||
|Long-term payables|80,118.00|80,118.00|
|Special payables|||
|Estimated liabilities|||
|Deferred tax liabilities|||
|Other long-term liabilities|||
|Total non-current liabilities|80,118.00|80,118.00|
|Total liabilities|1,720,766,432.94|1,638,730,555.72|
|Owner‘s equity|||
|Share capital|215,000,000.00|215,000,000.00|
|Capital reserve|185,374,533.85|185,374,533.85|
|Less: Treasury stock|||
|Reasonable reserve|||

||||
|-|-|-|
|Surplus reserve|589,559.77|589,559.77|
|Provision of general risk|||
|Undistributed profit|-23,907,814.55|-14,489,140.50|
|Balance difference of foreign|||
||-3,418,353.51|-3,264,432.90|
|currency translation|||
|Total shareholder‘s equity|||
||373,637,925.56|383,210,520.22|
|attributable to parent Company|||
|Minority interests|102,342,192.33|85,253,562.95|
|Total shareholder‘s equity|475,980,117.89|468,464,083.17|
|Total liabilities and shareholder‘s|||
||2,196,746,550.83|2,107,194,638.89|
|equity|||

Legal Representative: Hong Wang Person in Charge of Accounting Works: Lian Shi Person in Charge of Accounting Department: Huizhen Qiu2、The Statement Of Financial Position For Parent Company
Prepared by: NANJING PUTIAN TELECOMMUNICATIONS CO., LTD. 30 June 2014 Unit: RMB Yuan
||||
|-|-|-|
|Items|30 June 2014|31 December 2013|
|Current assets|||
|Monetary funds|202,121,906.06|243,256,318.34|
|Tradable financial assets|||
|Notes receivable|2,095,343.97|4,080,113.29|
|Accounts receivable|583,724,164.81|484,405,832.01|
|Prepayments|16,463,672.23|19,253,965.98|
|Interest receivable|||
|Dividend receivable|1,000,000.00|1,000,000.00|
|Other receivables|29,564,930.78|72,664,367.17|
|Inventories|203,460,491.61|215,007,723.17|
|Long-term debt investment due within|||
|a year|||
|Other current assets|||
|Total current assets|1,038,430,509.46|1,039,668,319.96|
|Non-current assets|||
|Available-for-sale financial assets|||
|Held-to-maturity investments|||
|Long-term accounts receivable|||
|Long-term equity investments|356,161,227.46|356,301,955.13|
|Investment property|||
|Fixed assets|27,224,920.95|28,670,106.90|
|Construction in progress|17,508,197.87|16,157,767.87|
|Construction materials|||
|Fixed assets held for disposal|||
|Productive biological assets|||
|Petrol assets|||
|Intangible assets|9,019,040.17|9,548,633.35|
|Development costs|||
|Goodwill|||
|Long-term prepayments|||
|Deferred tax assets|||
|Other non-current assets|||

||||
|-|-|-|
|Total non-current assets|409,913,386.45|410,678,463.25|
|Total assets|1,448,343,895.91|1,450,346,783.21|

 Legal Representative: Hong Wang Person in Charge of Accounting Works: Lian Shi Person in Charge of Accounting Department: Huizhen Qiu2、The Statement Of Financial Position For Parent Company (continued)
Prepared by: NANJING PUTIAN TELECOMMUNICATIONS CO., LTD. 30 June 2014 Unit: RMB Yuan
||||
|-|-|-|
|Items|30 June 2014|31 December 2013|
|Current liabilities|||
|Short-term loans|356,000,000.00|356,000,000.00|
|Tradable financial liabilities|||
|Notes payable|95,529,854.40|65,529,854.40|
|Accounts payable|560,787,025.02|570,182,414.45|
|Advances from customers|23,220,525.51|20,352,488.47|
|Accrued payroll|6,153,572.57|6,287,114.97|
|Taxes payable|519,711.12|-3,416,878.08|
|Interest payable|||
|Dividend payable|||
|Other payables|149,984,747.74|156,451,289.08|
|Long-term liabilities due within a year|||
|Other current liabilities|||
|Total current liabilities|1,192,195,436.36|1,171,386,283.29|
|Non-current liabilities|||
|Long-term borrowings|||
|Bonds payable|||
|Long-term payables|80,118.00|80,118.00|
|Special payables|||
|Estimated liabilities|||
|Deferred tax liabilities|||
|Other long-term liabilities|||
|Total non-current liabilities|80,118.00|80,118.00|
|Total liabilities|1,192,275,554.36|1,171,466,401.29|
|Owner‘s equity|||
|Share capital|215,000,000.00|215,000,000.00|
|Capital reserve|172,417,299.81|172,417,299.81|
|Less: Treasury stock|||
|Special reserves|||
|Surplus reserve|589,559.76|589,559.76|
|Provision of general risk|||
|Undistributed profit|-131,938,518.02|-109,126,477.65|
|Currency translation differences|||
|Total shareholder‘s equity|256,068,341.55|278,880,381.92|
|Total liabilities and shareholder‘s equity|1,448,343,895.91|1,450,346,783.21|

 Legal Representative: Hong Wang Person in Charge of Accounting Works: Lian Shi Person in Charge of Accounting Department: Huizhen Qiu3、Consolidated Income Statement for the period ended 30 June 2014
Prepared by: NANJING PUTIAN TELECOMMUNICATIONS CO., LTD. Jan. to Jun. 2014 Unit: RMB Yuan
||||
|-|-|-|
|Items|Jan. to Jun. 2014|Jan. to Jun. 2013|

||||
|-|-|-|
|I. Total operating income|1,173,023,650.25|1,207,557,538.82|
|Including: Operating income|1,173,023,650.25|1,207,557,538.82|
|Interest income|||
|Insurance gained|||
|Commission charge and commission|||
|income|||
|II. Total operating cost|1,177,400,953.61|1,204,885,342.50|
|Including: Operating cost|1,008,242,535.79|1,043,008,171.55|
|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|||
|Sales tax and surcharge|3,109,272.27|4,694,575.67|
|Sales expenses|84,634,467.99|82,273,548.91|
|Administration expenses|64,294,527.99|62,829,331.87|
|Financial expenses|15,922,237.55|11,488,031.64|
|Losses of devaluation of asset|1,197,912.02|591,682.86|
|Add: Changing income of fair value(Loss is listed|||
|with―-‖)|||
|Investment income (Loss is listed with ―-‖)|227,042.96|-1,883,203.49|
|Including: Investment income on affiliated|||
||227,042.96|-1,862,331.47|
|Company and joint venture and joint venture|||
|Exchange income (Loss is listed with ―-‖)|||
|III. Operating profit (Loss is listed with ―-‖)|-4,150,260.40|788,992.83|
|Add: Non-operating income|4,748,462.85|1,927,667.56|
|Less: Non-operating expense|413,073.73|600,115.85|
|Including: Disposal loss of non-current asset|105,658.79||
|IV. Total Profit (Loss is listed with ―-‖)|185,128.72|2,116,544.54|
|Less: Income tax|5,248,812.79|3,597,267.56|
|V. Net profit (Net loss is listed with ―-‖)|-5,063,684.07|-1,480,723.02|
|Include: the net profit of the consolidated party|||
|before consolidation|||
|Net profit attributable to owner‘s equity of parent|||
||-9,418,674.05|-2,719,217.34|
|Company|||
|Minority shareholders‘ gains and losses|4,354,989.98|1,238,494.32|
|VI. Earnings per share|--|--|
|i. Basic earnings per share|-0.044|-0.013|
|ii. Diluted earnings per share|-0.044|-0.013|
|VII. Other comprehensive income|-153,920.61|293,104.46|
|VIII. Total comprehensive income|-5,217,604.68|-1,187,618.56|
|Total comprehensive income attributable to|||
||-9,572,594.66|-2,426,112.88|
|owners of the parent company the parent company|||
|Total comprehensive income attributable to|||
||4,354,989.98|1,238,494.32|
|minority interests|||

Legal Representative: Hong Wang Person in Charge of Accounting Works: Lian Shi Person in Charge of Accounting
Department: Huizhen Qiu
4、Income Statement of Parent Company for the period ended 30 June 2014
Prepared by: NANJING PUTIAN TELECOMMUNICATIONS CO., LTD. Jan. to Jun. 2014 Unit: RMB Yuan
||||
|-|-|-|
|Items|Jan. to Jun. 2014|Jan. to Jun. 2013|
|I. Sales Income|614,677,489.24|725,615,062.25|
|Less: Business costs|552,638,621.78|655,279,644.09|
|Sales tax and surcharges|1,157,827.97|2,658,463.54|
|Sales expenses|41,612,512.74|43,577,265.99|
|Administration expenses|28,264,465.63|25,456,357.31|
|Financial expenses|13,816,618.39|9,674,355.31|
|Losses of devaluation of asset|11,032.50|34,764.05|
|Add: Changing income of fair value(Loss is|||
|listed with ―-‖)|||
|Investment income (Loss is listed with|||
||157,112.33|-1,862,331.47|
|―-‖)|||
|Including: Investment income on affiliated|||
||157,112.33|-1,862,331.47|
|Company and joint venture|||
|II. Operating profit (Loss is listed with ―-‖)|-22,666,477.44|-12,928,119.51|
|Add: Non-operating income|15,276.00|78,240.00|
|Less: Non-operating expense|160,838.93|259,677.17|
|Including: Disposal loss of non-current|||
|asset|||
|III. Total Profit (Loss is listed with ―-‖)|-22,812,040.37|-13,109,556.68|
|Less: Income tax|||
|IV. Net profit (Net loss is listed with ―-‖)|-22,812,040.37|-13,109,556.68|
|V. Earnings per share|--|--|
|i. Basic earnings per share|-0.106|-0.061|
|ii. Diluted earnings per share|-0.106|-0.061|
|VI. Other comprehensive income|||
|VII. Total comprehensive income|-22,812,040.37|-13,109,556.68|

 Legal Representative: Hong Wang Person in Charge of Accounting Works: Lian Shi Person in Charge of Accounting
Department: Huizhen Qiu
5、Consolidated Cash Flow Statement for the period ended 30 June 2014
Prepared by: NANJING PUTIAN TELECOMMUNICATIONS CO., LTD. Jan. to Jun. 2014 Unit: RMB Yuan
||||
|-|-|-|
|Items|Jan. to Jun. 2014|Jan. to Jun. 2013|
|I. Cash flows arising from operating activities:|||
|Cash received from the sale of goods or rendering of|||
||1,229,120,473.25|1,218,515,488.00|
|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|||
|Insured savings and net increase of investment|||

||||
|-|-|-|
|Net increase of disposal of transaction financial asset|||
|Cash received from interest, commission charge and|||
|commission|||
|Net increase of capital borrowed|||
|Net increase of returned business capital|||
|Refunds of taxes|1,555,477.70|858,508.30|
|Other cash receipts relating to operating activities|56,541,699.10|14,337,476.96|
|Sub-total of cash inflows arising from operating activities|1,287,217,650.05|1,233,711,473.26|
|Cash paid for goods and services|1,091,173,084.56|1,122,929,225.96|
|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 and on behalf of employees|102,021,641.36|90,660,354.19|
|Payments of all types of taxes|46,730,180.60|60,343,173.64|
|Other cash payments relating to operating activities|103,807,526.32|95,034,007.42|
|Subtotal of cash outflow arising from operating activities|1,343,732,432.84|1,368,966,761.21|
|Net cash flows arising from operating activities|-56,514,782.79|-135,255,287.95|
|II. Cash flows arising from investing activities|||
|Cash received from recovering investment|10,657,600.00||
|Cash received from investment income|297,840.00||
|Net cash received from the sale of fixed assets,|||
|intangible assets and other long-term assets long-term|1,220.16|36,352.80|
|assets|||
|Net cash received from disposal of subsidiaries and|||
|other units|||
|Other cash received concerning investing activities|3,277,688.08||
|Subtotal of cash inflow from investing activities|14,234,348.24|36,352.80|
|Cash paid for purchasing fixed, intangible and other|||
||7,126,115.03|9,436,683.10|
|long-term assets|||
|Cash paid for investment||5,000,000.00|
|Net increase of mortgaged loans|||
|Net cash received from subsidiaries and other units|||
|Other cash paid concerning investing activities|||
|Subtotal of cash outflow from investing activities|7,126,115.03|14,436,683.10|
|Net cash flows arising from investing activities|7,108,233.21|-14,400,330.30|
|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|194,000,000.00|176,000,000.00|
|Cash received from issuing bonds|||
|Other cash received concerning financing activities|||
|Subtotal of cash inflow from financing activities|194,000,000.00|176,000,000.00|
|Cash paid for settling debts|171,000,000.00|161,800,000.00|
|Cash paid for dividend and profit distributing or|17,579,276.41|13,618,333.70|

||||
|-|-|-|
|interest paying|||
|Including: Dividend and profit of minority shareholder|||
|paid by subsidiaries|||
|Other cash paid concerning financing activities|||
|Subtotal of cash outflow from financing activities|188,579,276.41|175,418,333.70|
|Net cash flows arising from financing activities|5,420,723.59|581,666.30|
|IV. Influence on cash due to fluctuation in exchange rate|59,150.36|128,675.35|
|V. Net increase of cash and cash equivalents|-43,926,675.63|-148,945,276.60|
|Add: Balance of cash and cash equivalents at the period|||
||402,037,725.25|429,693,529.41|
|-begin|||
|VI. Balance of cash and cash equivalents at the period|||
||358,111,049.62|280,748,252.81|
|-end|||

Legal Representative: Hong Wang Person in Charge of Accounting Works: Lian Shi Person in Charge of Accounting
Department: Huizhen Qiu
6、Cash Flow Statement of Parent Company for the period ended 30 June 2014
Prepared by: NANJING PUTIAN TELECOMMUNICATIONS CO., LTD. Jan. to Jun. 2014 Unit: RMB Yuan
||||
|-|-|-|
|Items|Jan. to Jun. 2014|Jan. to Jun. 2013|
|I. Cash flows arising from operating activities:|||
|Cash received from the sale of goods or rendering of|||
||609,353,898.33|715,324,074.82|
|services|||
|Refunds of taxes|110,575.42||
|Other cash receipts relating to operating activities|31,438,573.22|37,379,114.46|
|Sub-total of cash inflows arising from operating activities|640,903,046.97|752,703,189.28|
|Cash paid for goods and services|556,164,809.62|717,541,302.03|
|Cash paid to and on behalf of employees|46,706,605.47|47,384,233.37|
|Payments of all types of taxes|9,946,758.24|27,750,342.93|
|Other cash payments relating to operating activities|43,091,916.57|51,173,375.01|
|Subtotal of cash outflow arising from operating activities|655,910,089.90|843,849,253.34|
|Net cash flows arising from operating activities|-15,007,042.93|-91,146,064.06|
|II. Cash flows arising from investing activities|||
|Cash received from recovering investment|10,657,600.00||
|Cash received from investment income|297,840.00||
|Net cash received from the sale of fixed assets,|||
|intangible assets and other long-term assets|||
|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|10,955,440.00||
|Cash paid for purchasing fixed, intangible and other|||
||2,302,703.48|5,377,085.19|
|long-term assets|||
|Cash paid for investment||5,000,000.00|
|Net cash received from subsidiaries and other units|||
|Other cash paid concerning investing activities|||
|Subtotal of cash outflow from investing activities|2,302,703.48|10,377,085.19|
|Net cash flows arising from investing activities|8,652,736.52|-10,377,085.19|
|III. Cash flows arising from financing activities|||
|Cash received from absorbing investment|||

||||
|-|-|-|
|Cash received from loans|136,000,000.00|136,000,000.00|
|Cash received from bonds issued|||
|Other cash received concerning financing activities|||
|Subtotal of cash inflow from financing activities|136,000,000.00|136,000,000.00|
|Cash paid for settling debts|136,000,000.00|131,800,000.00|
|Cash paid for dividend and profit distributing or|||
||14,492,578.87|11,240,332.77|
|interest paying|||
|Other cash paid concerning financing activities|||
|Subtotal of cash outflow from financing activities|150,492,578.87|143,040,332.77|
|Net cash flows arising from financing activities|-14,492,578.87|-7,040,332.77|
|IV. Influence on cash due to fluctuation in exchange rate|103,473.36|92,336.87|
|V. Net increase of cash and cash equivalents|-20,743,411.92|-108,471,145.15|
|Add: Balance of cash and cash equivalents at the period|||
||217,989,348.06|267,226,515.29|
|-begin|||
|VI. Balance of cash and cash equivalents at the period|||
||197,245,936.14|158,755,370.14|
|-end|||

Legal Representative: Hong Wang Person in Charge of Accounting Works: Lian Shi Person in Charge of Accounting
Department: Huizhen Qiu
7、Consolidated Statement of Changes inOwners’ Equity for the period ended 30 June 2014
Prepared by: NANJING PUTIAN TELECOMMUNICATIONS CO., LTD. Jan. to Jun. 2014 Unit: RMB Yuan
Amount for this period
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
||Amount for the period ended 30 June 2014||||||||||
||Shareholders‘ equity attributable to the parent Company||||||||||
|||||||General||||Total|
|Items|||Less:||||||Minority||
|||Capital||Reasonabl|Surplus|risk|Undistributed|||shareholders‘|
||Share capital||Treasur|||||Others|interests||
|||reserves||e reserve|reserves|provisio|profit|||equity|
||||y Stock||||||||
|||||||n|||||
|I. Balance at|||||||||||
||215,000,000.0|185,374,533.8|||589,559.7||-14,489,140.5|-3,264,432.9||468,464,083.1|
|the end of the|||||||||85,253,562.95||
||0|5|||7||0|0||7|
|last year|||||||||||
|Add:|||||||||||
|Changes of|||||||||||
|accounting|||||||||||
|policy|||||||||||
|Error|||||||||||
|correction of|||||||||||
|the last period|||||||||||
|Others|||||||||||
|II. Balance at|||||||||||
||215,000,000.0|185,374,533.8|||589,559.7||-14,489,140.5|-3,264,432.9||468,464,083.1|
|the beginning|||||||||85,253,562.95||
||0|5|||7||0|0||7|
|of this year|||||||||||
|III. Increase/|||||||||||
|Decrease in|||||||||||
|this year|||||||-9,418,674.05|-153,920.61|17,088,629.38|7,516,034.72|
|(Decrease is|||||||||||
|listed with ―-‖)|||||||||||
|(I) Net profit|||||||-9,418,674.05||4,354,989.98|-5,063,684.07|
|(II) Other|||||||||||
|comprehensiv||||||||-153,920.61||-153,920.61|
|e income|||||||||||
|Subtotal of (I)|||||||||||
||||||||-9,418,674.05|-153,920.61|4,354,989.98|-5,217,604.68|
|and (II)|||||||||||
|(III)|||||||||||
|Shareholders‘|||||||||12,733,639.40|12,733,639.40|
|contributions|||||||||||

|||||||||
|-|-|-|-|-|-|-|-|
|and||||||||
|reduction in||||||||
|capital||||||||
|1. Capital||||||||
|contribution||||||||
|from owners||||||||
|2.||||||||
|Share-based||||||||
|payment||||||||
|recognized in||||||||
|shareholders'||||||||
|equity||||||||
|3. Others||||||12,733,639.40|12,733,639.40|
|(IV) Profit||||||||
|distribution||||||||
|1.||||||||
|Withdrawal of||||||||
|surplus||||||||
|reserves||||||||
|2.||||||||
|Withdrawal of||||||||
|general risk||||||||
|provisions||||||||
|3.||||||||
|Distribution for||||||||
|shareholders||||||||
|4. Others||||||||
|(V)Transfer||||||||
|within||||||||
|shareholders'||||||||
|equity||||||||
|1.||||||||
|Capitalization||||||||
|of capital||||||||
|reserve||||||||
|2.||||||||
|Capitalization||||||||
|of surplus||||||||
|reserve||||||||
|3.||||||||
|Remedying||||||||
|loss with||||||||
|surplus||||||||
|reserve||||||||
|4. Others||||||||
|(VI)||||||||
|Reasonable||||||||
|reserve||||||||
|1.||||||||
|Withdrawal in||||||||
|the report||||||||
|period||||||||
|2. Usage in||||||||
|the report||||||||
|period||||||||
|(Ⅶ) others||||||||
|IV. Balance at|||||||475,980,117.89|
||215,000,000.0|185,374,533.8|589,559.7|-23,907,814.5|-3,418,353.5|102,342,192.3||
|the end of the||||||||
||0|5|7|5|1|3||
|report year||||||||

Legal Representative: Hong Wang Person in Charge of Accounting Works: Lian Shi Person in Charge of Accounting
Department: Huizhen Qiu
7、Consolidated Statement of Changes inOwners’ Equity for the period ended 30 June 2014 (continued) Prepared by: NANJING PUTIAN TELECOMMUNICATIONS CO., LTD. Jan. to Jun. 2014 Unit: RMB Yuan
Amount for last period
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
||Amount for the period ended 30 June 2013||||||||||
||Shareholders‘ equity attributable to the parent Company||||||||||
|||||||General||||Total|
|Items|||Less:||||||Minority||
|||Capital||Reasonabl|Surplus|risk|Undistributed|||shareholders‘|
||Share capital||Treasur|||||Others|interests||
|||reserves||e reserve|reserves|provisio|profit|||equity|
||||y Stock||||||||
|||||||n|||||
|I. Balance at|||||||||||
||215,000,000.0|185,374,533.8|||589,559.7||-19,387,788.4|-3,770,851.8|87,657,416.1|465,462,869.5|
|the end of the|||||||||||
||0|5|||7||1|2|4|3|
|last year|||||||||||
|Add:|||||||||||
|Retroactive|||||||||||
|adjustment|||||||||||
|under the|||||||||||
|same control|||||||||||
|Add:|||||||||||
|Changes of|||||||||||
|accounting|||||||||||
|policy|||||||||||
|Error|||||||||||
|correction of|||||||||||
|the last period|||||||||||
|Others|||||||||||
|II. Balance at|||||||||||
||215,000,000.0|185,374,533.8|||589,559.7||-19,387,788.4|-3,770,851.8|87,657,416.1|465,462,869.5|
|the beginning|||||||||||
||0|5|||7||1|2|4|3|
|of this year|||||||||||
|III. Increase/|||||||||||
|Decrease in|||||||||||
|this year|||||||-2,719,217.34|293,104.46|1,238,494.32|-1,187,618.56|
|(Decrease is|||||||||||
|listed with ―-‖)|||||||||||
|(I) Net profit|||||||-2,719,217.34||1,238,494.32|-1,480,723.02|
|(II) Other|||||||||||
|comprehensiv||||||||293,104.46||293,104.46|
|e income|||||||||||
|Subtotal of (I)|||||||||||
||||||||-2,719,217.34|293,104.46|1,238,494.32|-1,187,618.56|
|and (II)|||||||||||
|(III)|||||||||||
|Shareholders‘|||||||||||
|contributions|||||||||||
|and|||||||||||
|reduction in|||||||||||
|capital|||||||||||
|1. Capital|||||||||||
|contribution|||||||||||
|from owners|||||||||||
|2.|||||||||||
|Share-based|||||||||||
|payment|||||||||||
|recognized in|||||||||||
|shareholders'|||||||||||
|equity|||||||||||
|3. Others|||||||||||
|(IV) Profit|||||||||||
|distribution|||||||||||
|1.|||||||||||
|Withdrawal of|||||||||||
|surplus|||||||||||

|||||||||
|-|-|-|-|-|-|-|-|
|reserves||||||||
|2.||||||||
|Withdrawal of||||||||
|general risk||||||||
|provisions||||||||
|3.||||||||
|Distribution for||||||||
|shareholders||||||||
|4. Others||||||||
|(V)Transfer||||||||
|within||||||||
|shareholders'||||||||
|equity||||||||
|1.||||||||
|Capitalization||||||||
|of capital||||||||
|reserve||||||||
|2.||||||||
|Capitalization||||||||
|of surplus||||||||
|reserve||||||||
|3.||||||||
|Remedying||||||||
|loss with||||||||
|surplus||||||||
|reserve||||||||
|4. Others||||||||
|(VI)||||||||
|Reasonable||||||||
|reserve||||||||
|1.||||||||
|Withdrawal in||||||||
|the report||||||||
|period||||||||
|2. Usage in||||||||
|the report||||||||
|period||||||||
|(Ⅶ)others||||||||
|IV. Balance at||||||||
||215,000,000.0|185,374,533.8|589,559.7|-22,107,005.7|-3,477,747.3|88,895,910.4|464,275,250.9|
|the end of the||||||||
||0|5|7|5|6|6|7|
|report year||||||||

Legal Representative: Hong Wang Person in Charge of Accounting Works: Lian Shi Person in Charge of Accounting
Department: Huizhen Qiu
8、Statement of Changes inOwners’ Equity of Parent Company for the period ended 30 June 2014
Prepared by: NANJING PUTIAN TELECOMMUNICATIONS CO., LTD. Jan. to Jun. 2014 Unit: RMB Yuan Amount for this period
||||||||||
|-|-|-|-|-|-|-|-|-|
||Amount for the period ended 30 June 2014||||||||
||||Less:|||General||Total|
|Items||Capitalreserves||Reasonable|Surplus||Undistributed||
||Share capital||Treasury|||risk||shareholders'|
|||||reserve|reserves||profit||
||||Stock|||provision||equity|
|I. Balance at the end of the last|||||||||
||215,000,000.00|172,417,299.81|||589,559.76||-109,126,477.65|278,880,381.92|
|year|||||||||
|Add: Changes of accounting|||||||||
|policy|||||||||
|Error correction of the last|||||||||
|period|||||||||
|Others|||||||||
|II. Balance at the beginning of this|||||||||
||215,000,000.00|172,417,299.81|||589,559.76||-109,126,477.65|278,880,381.92|
|year|||||||||

|||||||
|-|-|-|-|-|-|
|III. Increase/ Decrease in this year||||||
|||||-22,812,040.37|-22,812,040.37|
|(Decrease is listed with ―-‖)||||||
|(I) Net profit||||-22,812,040.37|-22,812,040.37|
|(II) Other comprehensive||||||
|income||||||
|Subtotal of (I) and (II)||||-22,812,040.37|-22,812,040.37|
|(III) Shareholders‘ contributions||||||
|and reduction in capital||||||
|1. Capital contribution from||||||
|owners||||||
|2. Share-based payment||||||
|recognized in shareholders' equity||||||
|3. Others||||||
|(IV) Profit distribution||||||
|1. Withdrawal of surplus||||||
|reserves||||||
|2. Withdrawal of general risk||||||
|provisions||||||
|3. Distribution for shareholders||||||
|4. Others||||||
|(V)Transfer within shareholders'||||||
|equity||||||
|1. Capitalization of capital||||||
|reserve||||||
|2. Capitalization of surplus||||||
|reserve||||||
|3. Remedying loss with surplus||||||
|reserve||||||
|4. Others||||||
|(VI) Reasonable reserve||||||
|1. Withdrawal in the report||||||
|period||||||
|2. Usage in the report period||||||
|(Ⅶ)others||||||
|IV. Balance at the end of the report|||||256,068,341.55|
||215,000,000.00|172,417,299.81|589,559.76|-131,938,518.02||
|year||||||

Legal Representative: Hong Wang Person in Charge of Accounting Works: Lian Shi Person in Charge of Accounting
Department: Huizhen Qiu
8、Statement of Changes inOwners’ Equity of Parent Company for the period ended 30 June 2014 (continued)
Prepared by: NANJING PUTIAN TELECOMMUNICATIONS CO., LTD. Jan. to Jun. 2014 Unit: RMB Yuan
Amount for last period
||||||||||
|-|-|-|-|-|-|-|-|-|
||Amount for the period ended 30 June 2013||||||||
||||Less:|||General||Total|
|Items||Capital||Reasonable|Surplus||Undistributed||
||Share capital||Treasury|||risk||shareholders'|
|||reserves||reserve|reserves||profit||
||||Stock|||provision||equity|
|I. Balance at the end of the last|||||||||
||215,000,000.00|172,417,299.81|||589,559.76||-96,087,336.19|291,919,523.38|
|year|||||||||
|Add: Changes of accounting|||||||||
|policy|||||||||
|Error correction of the last|||||||||
|period|||||||||
|Others|||||||||
|II. Balance at the beginning of this|||||||||
||215,000,000.00|172,417,299.81|||589,559.76||-96,087,336.19|291,919,523.38|
|year|||||||||
|III. Increase/ Decrease in this year|||||||||
||||||||-13,109,556.68|-13,109,556.68|
|(Decrease is listed with ―-‖)|||||||||
|(I) Net profit|||||||-13,109,556.68|-13,109,556.68|

|||||||
|-|-|-|-|-|-|
|(II) Other comprehensive income||||||
|Subtotal of (I) and (II)||||-13,109,556.68|-13,109,556.68|
|(III) Shareholders‘ contributions||||||
|and reduction in capital||||||
|1. Capital contribution from||||||
|owners||||||
|2. Share-based payment||||||
|recognized in shareholders' equity||||||
|3. Others||||||
|(IV) Profit distribution||||||
|1. Withdrawal of surplus||||||
|reserves||||||
|2. Withdrawal of general risk||||||
|provisions||||||
|3. Distribution for shareholders||||||
|4. Others||||||
|(V)Transfer within shareholders'||||||
|equity||||||
|1. Capitalization of capital||||||
|reserve||||||
|2. Capitalization of surplus||||||
|reserve||||||
|3. Remedying loss with surplus||||||
|reserve||||||
|4. Others||||||
|(VI) Reasonable reserve||||||
|1. Withdrawal in the report||||||
|period||||||
|2. Usage in the report period||||||
|(Ⅶ)others||||||
|IV. Balance at the end of the report||||||
||215,000,000.00|172,417,299.81|589,559.76|-109,196,892.87|278,809,966.70|
|year||||||

Legal Representative: Hong Wang Person in Charge of Accounting Works: Lian Shi Person in Charge of Accounting
Department: Huizhen Qiu
III Basic information of the Company
Nanjing Putian Telecommunications Co., Ltd. (in the following we refers to as‗thecompany‘) is the original Nanjing Telecommunication Facility Factory. The company was established as joint stock limited company by raising money approved with TGS (1997) No. 28 issued by National Economic Institutional Reform Commission on 21 March, 1997. The company was listed in Shenzhen Stock Exchange on 22 May, 1997. By 30 D 2011, the capital of the company is RMB 215,000,000.00 Yuan. The company is mainly engaged in telecom equipment manufacture industry. The business scope of the company is data telecom product, wires telecom product, wireless telecom product, distribution and allocation of layout of telecom product, research, manufacture of media computer and digital television, vehicle electronics . Research, sale of video conference system, and providing the related after-sales service ,including installation and maintenance and repairmen of equipments .Design of telecom information net project and computer information systematic project, and provision of related system combination and related consultancy service.
IV Principal accounting policies and accounting estimate and correction of previous errors 1. Basis for preparation of financial statement
The financial statements of the company are prepared on the hypothesis of going concern according to the actual occurred transactions and events, according to the―Accounting Standards for Business Enterprises - BasicStandard‖ (issued by the Ministry of Finance in 15 February 2006 ), 38 specific accounting standards, the―Note to the‗Accounting Standards for Business Enterprises - PracticeGuide‖ , explanatory notes and other relative regulations (hereinafter collectively referred to as―Accounting Standards for BusinessEnterprises‖).and in accordance with the accounting policy and estimation stated as follows.
2. Statement on Observation of Accounting Standard for Enterprise
The financial statement prepared by the company applies with the requirements of Accounting Standard for Enterprise, reflects the financial position at 31 December 2013, operational achievements and cash flow of the company for 2013 effectively and completely.
3. Accounting period
The accounting period of the Company is the calendar date from 1 January to 31 December.
4. Functional currency for accounting
The functional currency of the company is Renminbi (thereafter refer as the―RMB‖).
5. Accounting treatment of Business Combination
Business combination includes combination of entities or businesses under common control and combination under different control.
(1) Combination under common control
An acquirer of a business combination under common control recognizes the assets acquired and liabilities assumed at their
acquisition-date carrying values. The excess of the carrying value of acquired net asset over the carrying value of consideration
transferred (or nominal value of shares issued) is charged to capital surplus. If capitalreserve‘s not enough, the balance is charged to retained earnings.
Transaction costs that are directly attributable to the acquisition are recorded as profit or loss in the current period.
(2) Combination under different control
The consideration transferred in a business combination under different control are measured at fair value, which shall be calculated as the sum of the acquisition-date fair value of the assets transferred by the acquirer, the liabilities incurred and the equity interests issued by the acquirer. For business combination achieved in stages, combination costs are the sum of each transaction cost. Combination under different control, the acquirer occur audit, legal service, evaluation consultation etc intermediary fee and other related administrative expenses for business combination, shall be recorded into the profits and losses; the consideration of the equity securities issued or debt securities transaction costs, shall be included in the equity securities or debt amount of initial recognition of securities. Combination cost includes consideration transferred and transaction costs that are directly attributable to the acquisition. The acquirer shall recognize the fair value of contingent consideration at acquisition date as part of the consideration transferred in exchange for the acquiree.
An acquirer of a business combination recognizes the identifiable assets acquired and liabilities and contingent liabilities assumed at their acquisition-date fair value. The excess of combination cost over the fair value of the net identifiable assets acquired is measured as goodwill. When the fair value of the net identifiable assets acquired exceeds combination cost, before recognizing a gain on a bargain purchase, the company will reassess whether it has correctly measured all of the identifiable assets acquired, all of the liabilities and contingent liabilities assumed and combination cost. The difference is recorded to profit or loss in the current period if the fair value of the net identifiable assets acquired exceeds combination cost after the review.
6. The accounting treatment for step disposal of subsidiary equity to lose control
(1) Step disposal of equity to determine the loss of control during the transaction whether the
principle of a "package deal"
When the terms of the disposal of the equity investment in the subsidiary transaction, subject to the following conditions and the economic impact of one or more of the multiple transactions accounted for as a package deal:
①(cid:1) These transactions are considered simultaneously, or in the case of each of the affected parties;
②(cid:1) These transactions as a whole in order to reach a complete business results;
③(cid:1) The occurrence of a transaction depends on the occurrence of at least one other transaction;
④(cid:1) One transaction alone is not economical to see, but when considered together with other transaction is economical.
(2) The accounting treatment for step disposal of equity is not a "package deal" to the loss of control of the transactions in the financial statements of the parent company and consolidated financial
statements
For every loss of control of a transaction before, the difference is recognized in the parent company's financial statements for the disposal proceeds and the carrying value of the disposal of the investment in the corresponding investment income for the current period; consolidated financial statements will be at the disposal of the investment cost and disposal entitled to the corresponding sub-the difference between the Company's share of net assets in accordance with the "no loss on the disposal of certain circumstances under the control of the accounting treatment of investments in subsidiaries reply" (accounting will[2009] No. 14) provisions included in capital surplus (capital premium), capital premium insufficient, any excess is adjusted to retained earnings. For the loss of control transaction, the parent company financial statements, for the stake disposal, in accordance with
"Accounting Standards for Enterprises No. 2 - Long-term equity investment," the provisions of the accounting treatment;
Meanwhile, the remaining equity, their carrying value is recognized long-term equity investment or other related financial assets. After the disposal of the remaining equity to implement joint control or significant influence on the existing subsidiaries, the relevant cost method to equity method accounting treatment of the relevant provisions. In the consolidated financial statements, the remaining equity, in accordance with their re-measured at fair value loss of control date. Disposal of the shares acquired on the price and the fair value of the equity and the remainder, less the original stake should have calculated the difference between the share of the net assets of the subsidiary from the original purchase date of the beginning of sustained calculated between the current period included a loss of control investment income. Other comprehensive income related to the former subsidiary's equity investment in the loss of control into investment income.
(3) Step disposal of equity belonging to the "package deal" to the loss of control of the transactions in the financial statements of the parent company and consolidated financial statements of the
accounting treatment
For part of the "package deal" will the transaction as a loss on disposal of a subsidiary and accounting control of transactions processed in the parent company financial statements at each disposal proceeds and the carrying value corresponding to the difference between the disposal of investments are recognized as investment income; for the remaining equity after the loss of control over their book value is recognized as a long-term equity investments or other financial assets, the remaining equity after the loss of control to implement joint control or significant influence on the former subsidiary, according to the relevant provisions of the relevant cost method to the equity method of accounting.
In the consolidated financial statements, for a loss of control before each transaction, and will dispose of the net assets of the subsidiary entitled to the difference between the share price and the corresponding disposal of investments are recognized in other comprehensive income, together with the loss of control into a loss of control profit or loss; for transactions when control is lost, the remaining equity, in accordance with their re-measured at fair value at the date of loss of control, the fair value of the consideration and the remaining equity stake acquired and disposed of, is calculated by subtracting the original stake should have started from the purchase date between the share of the net assets of the ongoing calculation of the difference between the original subsidiary, included in investment income lost control of the current period. Other comprehensive income related to the former subsidiary's equity investment in the loss of control into investment income.
7. Basis of Preparation of Consolidated Financial Statements
The Company shall put subsidiaries which it controlling totally, main body with special purpose into consolidated financial statements.
Consolidated financial statements have been prepared in accordance with the ASBEs No. 33 - Consolidated Financial Statements and relevant supplementary regulations. All significant transactions and balances between the Company and its subsidiaries are eliminated for the purpose of consolidation. The equity of subsidiaries not held by the parent company shall be presented separately as minorityshareholders‘ equity in consolidatedshareholders‘ equity.
Any difference arising from the inconformity of accounting year or accounting policies between the subsidiaries and the Company shall be adjusted in the consolidated financial statements.
When preparing the consolidated financial statements, if the Company acquired the subsidiary through business combination not involving under common control, the separate financial statements shall be adjusted based on the fair value of identifiable net assets at the acquisition date. If the subsidiary is acquired through business combination involving common control, the consolidated financial statements shall include the carrying amount of assets, liabilities, operating result and cash flow of the subsidiary at the beginning of the current period, as if business combination also had occurred the beginning of the current period.
8. Cash and cash equivalent
The cash reflected in the cash flow statement of the Company represents the inventory cash and the deposit available for payment at any time.
The cash equivalent in the cash flow statement refers to the kind of investment with short holding term and strong flow ability. At the same time, the cash equivalent is easy to convert into cash with already-known amount and risk of value change is very small. 9. Foreign currency business and foreign currency financial statement conversion
(1) Foreign currency business
As for the foreign currency business, the Company converts the foreign currency amount into RMB amount pursuant to the spot exchange rate as of the business day.
As at the balance sheet date, monetary items expressed by foreign currency are converted into RMB pursuant to the spot exchange rate, for prompt exchange rate on the spot rate and the time of initial recognition or before the date of the balance sheet at the spot exchange rate and produce different exchange balance, except a qualified foreign currency exchange balance specifically borrowed in the capitalization period shall be included in the relevant asset costs of capitalization of the, all included in the current profits and losses.
As for the foreign currency non-monetary items measured by historical cost, conversion is made with the spot exchange rate as of the business day, with no change in RMB amount. With the fair value measurement of foreign currency non-monetary items at the fair value determined day at the spot exchange rate, convert the amount of functional currency with the original amount of functional currency of the variance, as the changes in the fair value (including exchange rate fluctuation) processing, included in the current profits and losses or confirmed for other comprehensive income and included in the capital reserve.
(2) Conversion of foreign currency financial statement
As for the subsidiaries and joint ventures with different standard currency for accounting from the company, the Company account for transaction and prepare consolidated financial statements after conversion of related foreign currency financial statements.
Spot exchange rate as of the balance sheet date is adopted for conversion of assets and liabilities in foreign currency balance sheet; as for the items in statement ofowners‘ equity except for―Undistributedprofit‖, conversion is made pursuant to the spot exchange rate of business day; income and expense items in income statement then are also converted pursuant to the spot exchange rate of transaction day approximately, which is systematic and reasonable method. Difference arising from the aforementioned conversions shall be listed separately in items ofowners‘ equity.
Spot exchange rate as of the occurrence date of cash flow approximately is adopted for conversion of foreign currency cash flow, which is systematic and reasonable method. The amount of cash affected by exchange rate movement shall be listed separately in cash flow statement.
When disposing operation abroad, related difference arising from foreign currency exchange is transferred to profit or loss in the current period, transferred proportionately when partially disposed.
10. Financial Instruments
(1) Classification, recognition and measurement of financial instruments
The Company classifies financial instruments into the following two categories, namely financial assets or financial liabilities.
Financial assets at initial recognition are classified as: financial assets measured at fair value through profit or loss (including trading financial assets and those financial assets designated at fair value through profit or loss of), held-to-maturity investment, loans and accounts receivables, as well as financial assets available-for-sale. In addition to accounts receivable outside of the financial assets depends on thecompany‘s and itssubsidiaries‘ classification of the financial assets held intention and hold ability, etc.
Financial liabilities at initial recognition are classified as: financial liabilities at fair value through profit or loss (including trading financial liabilities and financial liabilities designated at fair value through profit or loss) and other financial liabilities.
When the Company becomes one party of financial instrument contracts, it recognizes a related financial asset or financial liability. The financial assets or financial liabilities initial recognition is measured at fair value. Follow-up measurement is classification treatment: with the fair value measurement and the changes are included in the profits and losses of the financial assets, available for sale financial assets and to the fair value measurement and the financial liability measured at fair value and changes included in the profits and losses; financial guarantee contract and below the market rate loans loan commitment, in the initial confirmed according to the Accounting Standards for Enterprises 13 - Contingencies determine the amount and the initial affirm amount deducted ,according to the Accounting Standards for Enterprises 14-Revenue, the principles of determine income of the cumulative amortize frontal balance after the higher among a follow-up measurement; held-to-maturity investment, loans and accounts receivable and other financial liabilities at the amortized cost measurement.
Fair value change of financial assets or financial liabilities in the follow-up measurements, except they are hedged against certain risk ,should be accounted asfollows:①Fair value change of financial assets or financial liabilities which are measured by fair value and whose fair value change is recorded into prevailing gains and losses is recorded into gains and losses of fair value change; Interests or cash dividend acquired from holding assets are recognized as investment income; when disposing such assets, the difference between their fair value and initial accounting amount is recognized as investment gains and losses. Meanwhile, gains and losses of fair value shall be adjusted.②Fair value change of financial assets available-for-sale is recorded into capital reserve; the interests calculated by effective interest rate method during the holding period are written into investment income; cash dividend obtained from investment by equity instrument available-for-sale is written into investment income at the time when the invested company declares to grant dividend; the difference between the payment received when disposal of such assets and carrying value after deducting the accumulative fair value change which is originally and directly recorded into capital reserve, is written into investment gains and losses.
(2) Recognition and measurement of transferring of financial assets
Where there is a transfer of financial assets, the Company should derecognize the entire financial asset if it has transferred nearly all of the risks and rewards related to ownership of the financial asset to the transferee; or it is out of the control of the asset, although it has not yet transferred the asset or it has not retained almost the risks and rewards relating to ownership of the financial asset.
When the transfer of financial assets qualify for de-recognition criteria, the Company should measure correspondingly, namely differences between the book value of the transferred financial assets and the sum of consideration received by the transfer, and the accumulated changes in fair value directly included in the capital reserve (when transferred financial assets involve available-for-sale financial assets) should be included in profit and loss in the current period.
If the partial transfer of financial assets qualify for de-recognition criteria, the Company should measure correspondingly, namely the overall book value of the transferred financial assets are divided according to the fair value of transferred and retained part, and the difference between the book value of the derecognized part and the sum of the consideration of the derecognized part, and the amount of the corresponding part of the accumulated changes in fair value directly included in the capital reserve (when
the transfer involve available-for-sale financial assets) is recorded to profit or loss in the current period.
(3) De-recognition of financial liabilities
Recognition of certain liability should be terminated when related current obligation has already been wholly or partly discharged. (4) Recognition of fair value of financial assets and liabilities
For those financial instruments existing in active markets, market quotation in the active market is used to confirm their fair values. Fair value of the financial instruments which have no active market is confirmed by adoption of estimation technology.
Estimation technology includes reference to the price applied by parties which know well situation and are willing to make deals in the latest market business, reference to the current fair value of other financial assets which are the same in principle, reference to discounted cash flow method and so on. When estimation technology is adopted, parameters of the market should be applied at the most, prior to the parameters of the Company and its subsidiaries.
(5) The impairment test and the impairment provision of the financial assets
Except for the financial assets which are measured by fair value and whose fair value change is recorded into prevailing gains and losses, the Company will make check in the carrying value of other financial assets as at the balance sheet date. The impairment provision is recognized where there is any objective evidence proving that such financial asset has been impaired.
For single amount significant financial assets impairment test separately; individual amount not significant financial assets, impairment test separately or included in the portfolio with similar credit risk characteristics of financial asset for impairment test. Separate impairment test did not occur impair (both single amount significant and not significant financial assets), including in the portfolio with similar credit risk characteristics of financial asset for impairment test again. Already single confirm the impairment loss of financial assets, no need to do impairment test again.
The held-to-maturity investment, loans and accounts receivable become impaired, write down their book value to expected future cash flow, write-down amount recognized as the impairment loss, included in the current profits and losses. Financial asset available for sale impaired originally recorded in the capital reserve, because of the fair value of the cumulative losses shall drop formation transferred out and included in the current profits and losses, transferred cumulative loss of the assets initial acquisition cost deducting already recovered principal and amortization amount, the current fair value and the balance of impairment loss original already included in the profit and loss.
(6) Reclassification of financial asset
Held-to-maturity investment that is not yet expired can be reclassified as available-for-sale financial assets,
When it meet the following situation:
①There is no financial resource to be utilized providing requisite funds continually to hold the financial assets to maturity.
②There is no intention of holding the financial assets to maturity for management.
③It is difficult to hold the financial assets to maturity due to the restriction of laws and regulations and other factors.
④Others showing that the Company has not the ability to hold the financial assets to maturity.
Significant parts of above must be approved by the board of directors before making a decision.
11. Accounts receivable
Accounts receivable include accounts receivable and long-term accounts receivable and other account receivable. On the balance sheet day, there is any objective evidence proving that accounts receivable has been impaired, an impairment provision is made according to the difference between the carrying amount of accounts receivable and the present value of the predicted future cash
flow.
(1) Single amount dramatic and individual provision for the accounts receivable:
Recognition criteria Individual amount more than RMB10,000,000Yuan
Provision method Individual identification method
(2) Classification as the combination of provision for account receivable
Group recognition criteria Amount, risk size
Group1 Single amount major but not separate accrual provision
Group 2 Single amount not significant and portfolio risk is low
Group 3 Single amount not significant but risk is high in the group
Provision method for group
Group 1 Age analysis
Group 2 No provision
Group 3 Age analysis
Adopt age analysis provision in group as follows:
||
|-|
|Accounts receivable provisionproportion (%)|
|0.00%|
|0.00%|
|10.00%|
|30.00%|
|40.00%|
|80.00%|
|100.00%|

(3) Single amount not significant but single provision for accounts receivable
Single provision reason Separately impairment test, exist objective evidence for impairment
Provision method Individual identification method
12. Inventories
(1) Classification of inventory
The company holds the assets for sale, which are finished goods in the ordinary course of the business, or in the process of production for such sale, or in the form of materials or supplies to be consumed in the production process or in the rendering of services. The inventories of the Company comprises of raw materials, turn-over materials , consigned materials for processing ,packing materials, low-value consumable items ,work in process, self-made semi-finished product, finished goods etc.
(2) Measurement of issued inventory
The inventory is measured using weighted average method when issued.
(3) Recognition and measurement for inventory impairment provision
On balance sheet date, the inventories are measured at lower of cost and net realizable value. It is provided according to the difference between the cost of single inventory item and its net realizable value. But as for others with large quantity and low price, the reserve is provided according to categories.
The determination of net realizable value of inventories based on:① net realizable value of finished products is the estimated selling price less estimated selling expenses and the relevant tax payments;②as for materials hold for production, when net realizable value of finished products derived from these materials is higher than the cost of those, measured at cost; when the material prices show that the net realizable value of finished products produced by these materials is below cost, net realizable value will be the estimated sale price less estimated cost to completion, estimated selling expenses and related tax expense.③ as for materials held for sale, net realizable value is the market price.
(4) Inventory system
The stocktaking system is perpetual inventory system.
(5) Amortization method for low value consumable items and packing materials
The low value consumable items are amortized by step-amortization method and packaging materials are amortized by applying immediate write-off method when consumed.
13. Long-term equity investment
(1) Initial measurement of long-term equity investment
①The long-term equity investment acquired through combination under common control are measured at the attributable share of carrying amount of owners equity as its initial investment cost; the investments acquired through combination under different control are initially recognized at combination cost.
②The long-term equity investment is acquired through cash payment, the actual payment for the purchase shall be deemed as initial investment cost.
③The long-term equity investment is acquired by issuing the equity securities, the fair values of issued equity securities will be deemed as the initial investment cost.
④The long-term equity investment made by the investors, the agreed price in investment contract or agreement will be deemed as the initial investment cost.
⑤long-term equity investment which is acquired through debt reorganization and non-monetary assets exchange, regulations of relevant accounting standards shall be referred to for confirming initial investment cost.
(2)Subsequent measurement of long-term equity investment and recognition of investment income
Cost method and equity method is adopted for long-term equity investment respectively. The long-term investment under the equity method should be entitled to or shared by the investee's net share of profit or loss, recognize the long-term equity investment income and investment. When declare distribution of profits or cash dividends should be allocated to the part, a corresponding reduction in the carrying value of long-term equity investments.
The long-term equity investment under cost method, except for additional or return on investment, the carrying value is generally same. The dividends or profits declared by the investee are recognized as the current investment income.
When the company has joint control or significant influence over the investee, adopting equity method, otherwise cost method will be applied.
(3) Recognition criteria for joint control and significant influence
The recognition criteria for joint control includes: decision relating to financial policies and operation policies of joint company
needs identical agreement by all the joining parties based on agreement in the contract between all the joining parties.
The recognition criteria for significant influence includes: when the company owns above20% (including20%) below50% voting shares of invested company. When the company owns below20% (excluding20%) voting shares of invested company, significant influence over invested company should be recognized when it meets one of the following situations:
①Delegation of certain representative in the board of directors or similar situation of investee company.
②Participate the decision-making of investee company
③Delegation of certain management staff in the investee company.
④Reliance to technology or technological materials of investee company.
⑤others stating significant influence over investee company.
(4) Test of impairment and provision of impairment
On balance sheet date, the company carries out an inspection if there is any evidence that the long-term investment is impaired. When any evidence stating long-term investment impaired occurs. The company should estimate its recoverable amount and carry out impairment test. Impairment loss is measured at difference between carrying value and recoverable amount .The impairment loss will never be reversed in the future once it is ascertained.
Recoverable amount is the higher amount of the net fair value for sale and the present value of estimated future cash flows. The net fair value for sale is sell price agreed less related tax expenses, when existent fair trade agreement price. When there is no fair trade sales agreement but there is an active market or transaction prices for similar assets with the industry, according to market price less the related tax.
14. Investment property
(1) Classification and measurement
The investment property of the company includes: leasing land use rights, rent buildings, land use rights which are hold and prepared for transfer after appreciation of land use rights.
The company's investment property is initially measured at cost, with subsequent measurement at cost model.
(2) Accounting for cost model
The company investment property of rental building adopts straight-line method depreciation, specific depreciation policies the same as fixed assets.
The company investment property of land use, hold appreciation land-use right for transfer using the straight-line method amortize. For land use right for lease, the same amortization policies as those of the intangibles are adopted.
The balance sheet date, the company should review investment property whether there are impairment of signs, when there is any sign of impairment should undertake impairment test confirmed recoverable amount, which is the lower of book value and the recoverable amount, provision for impairment loss is no longer in the future accounting periods turn back.
15. Fixed assets
(1) Recognition
Fixed assets are tangible assets that have useful life more than one year, and are held for use in the production or supply of goods or services, for rental to others or for administrative purposes. No fixed asset may be recognized unless it meets all the
following conditions:
①The economic benefits related with the fixed asset are probably to flow to the enterprise; and
②The cost of the fixed asset can be measured reliably
(2) Classification and Depreciation
Thecompany‘s fixed assets are classified as buildings and structures, machinery equipment, transportation equipment and electronic and other equipment. Depreciation method is the straight-line method. The depreciation rate is recognized in accordance with category, estimated useful life and estimated residual rate of fixedassets，based on nature and utilization of each category. The company will review the useful life, estimated residual value and deprecation method of the fixed assets at the year end, and make necessary adjustment once difference occurs from estimated before. The company withdraws depreciation for all fixed assets except for those which have been fully depreciated while continuing to use and the land which is accounted with separate pricing. The estimated residual value rate, useful life and annual depreciation rate of each category of fixed assets are as follows:
|||
|-|-|
|Useful life (year)|Residual value rate (%)|
|15-35|3|
|10-15|3|
|6-8|3|
|4-11|3|

(3) Impairment test and provision for impairment
On balance sheet date, the company carries out an inspection if there is any evidence that the fixed asset is impaired. If fixed asset is impaired, the company will estimate its recoverable amount and carry out impairment test, the impairment loss should be recognized in profit or loss and provision identified, based on the lower of its carrying value and recoverable amount. The impairment loss will never be reversed in the future once it is ascertained.
Recoverable amount is measured as the higher value of fixedasset‘s fair value less costs to sell and present value of its estimated cash flow. The net fair value for sale is sell price agreed less directly attributable costs to sell, when there is fair price for transaction according to the sales agreement can be directly allocated the price minus the disposal expenses determined the amount of assets; when without fair price for transaction but existence of similar active market according to the market price minus the disposal expenses to determine the amount.
(4) Recognition and measurement of fixed assets under finance lease
A lease is classified as a finance lease if it transfers substantially all the risks and rewards incidental to ownership. Examples of situations that individually or in combination would normally lead to a lease being classified as a finance lease are:①The lease transfers ownership of the asset to the lessee by the end of the lease term;②The lessee has the option to purchase the asset at a price that is expected to be sufficiently lower than the fair value at the date the option becomes exercisable for it to be reasonably certain, at the inception of the lease, that the option will be exercised;③The lease term is for the major part of the economic life of the asset even if title is not transferred;④At the inception of the lease the present value of the minimum lease payments amounts to at least substantially all of the fair value of the leased asset;⑤The leased assets are of such a specialized
nature that only the lessee can use them without major modifications.
The valuation of finance lease: the initial recognition of fixed assets financed by leasing at the lease period begins is the lower of
the fair value of the leased asset and the present value of minimum lease payments.
The depreciation policy for depreciable leased assets shall be consistent with that for depreciable assets that are owned, and the depreciation recognized shall be calculated in accordance with fixed assets, as well as test of impairment.
16. Construction in process
(1) Classification
The Company will classify construction in progress as self- construction and contract-out- construction.
(2) Criterion and timeless of Construction in progress being transferred to fixed assets
Construction in progress is transferred to fixed assets when the project is substantially ready for its intended use. Examples of situations that shows being ready for its intended use are listed below
① The physical construction of fixed assets (including installation) have been completed or substantially completed;
②Have been pre-production or test run, and the results show that the assets to normal operation or to stabilize the production of qualified products, or test the results show that it can operate normally or business;
③Expenditure in the future associated with fixed assets, little or no place;
④The acquisition or construction of fixed assets has reached the design or contract requirements, or consistent with the basic design or contract requirements.
(3) Method of the carrying out impairment test and provision of impairment
On balance sheet date, the Company carries out an inspection if there is any evidence that the construction in progress is impaired. If construction in progress is impaired, the Company will estimate its recoverable amount and carry out impairment test, the impairment loss should be recognized in profit or loss and provision identified, based on the lower of its carrying value and recoverable amount. The impairment loss will never be reversed in the future once it is ascertained.
Recoverable amount is measured as the higher value of construction inprogress‘s fair value less costs to sell and present value of its estimated cash flow.
17. Borrowing expense
(1) Recognition of borrowing expense capitalization
The borrowing expense which could be directly attributable to purchase or production of assets satisfying capitalization condition, starts capitalization and are recorded to the cost of related assets. Other borrowing expense is recognized as expense as soon as it happens. Assets satisfying capitalization principle generally refer to fixed assets, investment property and inventories which can only arrive at predicted available-for-use or available-for-sale state after quite a long time in purchase or production activities.
(2) Calculation of borrowing expense capitalization
The capitalization period: from borrowing cost starts capitalization to stop capitalization. The capitalization of the borrowing costs suspended during not included.
If abnormal interruption happens during purchase or production of assets satisfying capitalization principle and the interruption lasts over 3 months, the capitalization for the borrowing expense shall pause until the purchase or production restarts.
Amount of borrowing expense capitalization:①Capitalization shall be exercised for interest expense actually occurred from
special borrowings in current period after deduction of the interest income arising from unutilized borrowing capital which is saved in banks or deduction of investment income obtained from temporary investment;②For reorganization of capitalized amount of common borrowing, it equals to the weighted average of the assets whose accumulated expense or capital disburse is more than common borrowing times capitalization rate of occupied common borrowing. Capitalization rate is determined according to weighted average interest rate of common borrowing.③amortization of discount or premium by effective interest method in each accounting period ,adjusting interest expense in the responding period , when borrowings happened originally in discount or premium.
Effective interest method determines interest expense, amortization of discount or premium in effective interest, which is IRR of carrying value of the borrowing equal to NPV of future estimated cash flows resulting from the borrowing.
18. Intangible assets
(1) Measurement of intangible assets
The intangible assets shall be initially measured at cost. For those intangible assets purchased in by the company, their effective cost consist of actual payment and relevant other expenditure; for the intangible assets input by investors, effective cost is determined according to the value agreed in investment contracts and agreements, while if the agreed value is not fair, then effective value is confirmed according to fair value. The cost of an internally generated intangible asset is the sum of expenditure incurred from the date when the intangible asset first meets the recognition criteria to the date that expected usable condition are reached.
Subsequent measurement of intangible assets, classified as:①the intangible asset with a finite useful life should be allocated on straight-line method, the amortization period and the amortization method for an intangible asset shall be reviewed at least at each financial year-end, shall be adjusted if necessary;② no amortization for intangible assets with uncertain useful life, but at the end of each accounting period, re-examination on useful life of intangible assets, for any evidence proving that life of intangible assets is limited, then estimate of its useful life, according to the straight-line amortization.
(2) Estimation of useful life of intangible asset with a finite useful life
The intangible assets with limited useful life, estimating its useful life often consider the following factors:① for the asset of the relevant legal provisions control period or similar restrictions, such as franchise system, the lease term, etc;② using the assets in the production of products usually the life cycle, can obtain similar asset life information;③ the connection with other assets life.
(3) Basis of determination of indefinite use life with intangible assets
An intangible asset is regarded as having an indefinite useful life when there is no foreseeable limit to the period over which the asset is expected to generate economic limit to benefits for the company. The useful life of intangible asset that are not stipulated by contact or laws is ascertained based on previous experience orexperts‘ verification. If the period in which theasset‘s future economic benefits are expected to flow to the entity cannot be confirmed according to above ways, the company classified the intangible asset as intangible asset with indefinite useful life.
Criteria of indefinite use life:① acquisition of an intangible asset arising from contractual or other legal rights without prescribed detailed use life;② connection historical information with experts verification, the useful life of intangible asset that are not stipulated by contact or laws is ascertained yet.
On balance sheet date, the company is required to test intangible asset with an indefinite useful life for useful life at the end of each year, mainly in top-down method.
(4) Impairment
On balance sheet date, the Company carries out an inspection if there is any evidence that the intangible asset is impaired . If intangible asset is impaired, the Company will estimate its recoverable amount and carry out impairment test, the impairment loss should be recognized in profit or loss and provision identified, based on the lower of its carrying value and recoverable amount. The impairment loss will never be reversed in the future once it is ascertained.
Recoverable amount is measured as the higher value of intangibleasset‘s fair value less costs to sell and present value of its estimated cash flow.
(5) Research and Development Cost
Research cost is recorded to profit or loss when it is incurred. An intangible asset arising from the development phase of an internal project shall be recognized if, and only if, the Company can demonstrate all of the following:① the technical feasibility of completing the intangible asset so that it will be available for use or sale;② its intention to complete the intangible asset and use or sell it;③ how the intangible asset will generate probable future economic benefits, the entity can demonstrate the existence of a market for the output of the intangible asset or the intangible asset itself or, if it is to be used internally, the usefulness of the intangible asset can be proved;④ the availability of adequate technical, financial resource and other resources to complete the development and the ability to use or sell the intangible asset;⑤ the expenditure attributable to the intangible asset during its development can be measured reliably. Cost in development phase that does not meet above conditions is recorded to profit or loss when it is incurred.
Costs of internal projects should be distinguished into cost in research phase and cost in development phase. Research cost refers to cost arising from inventive activities aimed at obtaining new knowledge. It is typical of planning and exploratory. Development cost refers to cost arising from activities that apply result in research phase or other knowledge in a certain plan or design, to produce new or substantially improved material, equipment, and products etc. before commercial production or application. It is typical of being concise and to the point and higher possibility of success.
19. Long-term prepaid expenses
The long-term prepaid expenses of the Company are expenses for current and future periods that have been disbursed but will be amortized over one year (not include 1 year). It mainly includes parking fees, housing and decoration costs. Long-term prepayments are amortized based on the expected beneficial periods. If such long-term deferred expense could not bring benefit to following accounting periods, the unamortized value of the item shall be fully transferred to current gains and losses.
20. Provision
(1) Recognition criteria
When contingencies related obligation is present obligation of the company; probable that an outflow of economic benefits from the company will be required to settle the obligation; and a reliable estimate can be made of the amount of the obligation.
(2) Measurement
The estimated liabilities for initially recognized should be the best estimate of the expenditure required to settle the present obligation, such as the existence of a continuous range of expenditure required, and the various outcomes within the same likelihood, the best estimate in accordance with the intermediate range value determined; involving multiple projects, according to a variety of possible outcomes and associated probabilities to determine the best estimate.
On balance sheet date, the company reviews the carrying amount of provision. Where there is any concrete evidence that its
carrying amount is not the best estimate, the carrying amount is adjusted based on the best estimate.
21. Revenues
(1) Revenue recognition for sale of goods
Revenue from the sale of goods shall be recognized when all the following conditions have been satisfied:①the significant risks and rewards of ownership of the goods have been transferred to the buyer by the company;②the company retains neither continuous managerial involvement to the degree usually associated with the ownership nor effective control over the sold goods;③the amount of revenue can be measured reliably;④it is probable that the economic benefits associated with the transaction will flow to the company;⑤the costs incurred or to be incurred in respect of the transaction can be measured reliably.
Where the receipt of revenue agreed in the contract is delayed beyond the normal credit conditions, which is of financing intention, the receipt of revenue shall be determined on the basis of the fair value of the contract.
(2) Revenue recognition for rendering of services
When the outcome of a transaction involving the rendering of services can be estimated reliably, revenue associated with the transaction shall be recognized by reference to the stage of completion of the transaction at the balance sheet date. The stage of completion is based on the measurement of the work completed.
If the Company cannot reliably estimate the service performed the date of the balance sheet, the company applies the following treatment respectively:①if the service expenses incurred are recoverable, the revenue from rendering of services shall be recognized to the extent of the expenses incurred and the cost of sale transferred at the same amount;②if the service expenses incurred are not recoverable, the expenses incurred shall be recognized in the profit or loss and no revenue from rendering of services shall be recognized.
(3) Revenue recognition from alienation of right to use assets
The revenues from alienation of right to use assets will be recognized when all the following conditions have been satisfied:① it is probable that the economic benefits associated with the transaction will flow to the company; and② the amount of revenue can be measured reliably.
(4) Revenue from construction contracts
The presence of construction contract revenue, indicating completion method to determine the basis for progress.
22. Government grant
(1) Types of government grant
Government grant comprise government grant related with assets and grant related with income.
(2) Accounting for government grant
Government grant related with assets shall be recognized as deferred income, which is recognized as income over the useful life of the asset. But the government grant measured at nominal amounts shall be directly included in the current profit or loss. The government related with income shall be treated respectively in accordance with the circumstances as follows:①the grant used for compensating the related future expenses or losses of the company shall be recognized as deferred income and shall included in the current profit or loss during the period when the relevant expenses are recognized;②the grant used for compensating the related expenses or losses incurred to the company shall be directly included in the current profit or loss.
23. Deferred tax asset or liability
The deferred tax assets and deferred tax liabilities confirmation:
(1) A deferred tax asset and deferred tax liability shall be recognized by a difference (temporary difference) between the carrying amount of an asset or liability and its tax base, as well between carrying amount of items which have a tax base according to tax law but not recognized as assets or liabilities and its tax base, conjunction with expected income tax rate to be applied in the period when recovery of the asset or settlement of the obligation occur.
(2) The company shall recognize the corresponding deferred tax asset for deductible temporary differences as no higher than the taxable profits that will be available in the future, against which the temporary difference can be utilized. The company shall recognize the deferred tax asset that has not been recognized before, once there are sufficient evidences probably showing sufficient taxable profits will be available against the temporary deductible difference. The company shall reduce the carrying amount of a deferred tax asset to the extent that it is no longer probable that sufficient taxable profits will be available in future periods to allow the benefit of the deferred tax asset to be utilized.
(3) The company recognizes a deferred tax liability for all temporary differences arising from investments in subsidiaries, branches and associates, and interests in joint ventures, unless the company can control the time when temporary difference will reverse in the foreseeable future, and the temporary difference will probably not reverse in the foreseeable future simultaneously. The company recognizes a deferred tax asset for all deductible temporary differences arising from investments in subsidiaries, branches and associates, and interests in joint ventures, to the extent that it is probable that: the temporary difference will reverse in the foreseeable future; and taxable profit will be available against which the temporary difference can be utilized.
24. (cid:10) Leasing
If the terms of the lease transfer substantially transferred all the risks and rewards of ownership of the leased asset to the lessee, the lease is a finance lease, other leases, compared with an operating lease.
25. Major accounting policy modification, alteration accounting estimates description
(1) The main changes in accounting policies
The company report period without accounting policy change, no accounting estimates changes.
(2) The main changes accounting estimates
During the report period without previous accounting error corrected.
26. Preliminary accounting errors
During the report period without previous accounting error corrected.
V Taxations
(1) Major taxes and tax rates
||
|-|
|Tax base|
|Income from sales of goods and materials|
|Income from lease, installation ,procession, rendering of service|

||
|-|
|Tax base|
|Turnover tax|
|Turnover tax|
|Turnover tax|
|Taxable income|

The income tax, tax preferential policies advancements have not changed compared to last year.
Subsidiary Nanjing Putian Telege Intelligent Building Co., Ltd, and Nanjing Putian Changle Telecommunications Equipment Co., Ltd. is a high-tech enterprise, at a reduced rate of 15% pay enterprise income tax.
Putian Telecommunications (Hong Kong) Co., Ltd. was established in Hong Kong on 1 December 2000, and is subject to the Enterprise Income Tax at a rate of16.5% according to relevant rules in Hong Kong.
(2) Tax incentives and approvals
None.
(3) Others need to explain matters
None.
VI. Business combination and consolidated financial statements
The Company shall put subsidiaries which it controlling totally, main body with special purpose into consolidated financial statements.
Consolidated financial statements have been prepared in accordance with the ASBEs No. 33 - Consolidated Financial Statements and relevant supplementary regulations. All significant transactions and balances between the Company and its subsidiaries are eliminated for the purpose of consolidation. The equity of subsidiaries not held by the parent company shall be presented separately as minorityshareholders‘ equity in consolidatedshareholders‘ equity.
Any difference arising from the inconformity of accounting year or accounting policies between the subsidiaries and the Company shall be adjusted in the consolidated financial statements.
When preparing the consolidated financial statements, if the Company acquired the subsidiary through business combination not involving under common control, the separate financial statements shall be adjusted based on the fair value of identifiable net assets at the acquisition date. If the subsidiary is acquired through business combination involving common control, the consolidated financial statements shall include the carrying amount of assets, liabilities, operating result and cash flow of the subsidiary at the beginning of the current period, as if business combination also had occurred the beginning of the current period. 1. Subsidiary
(1) Subsidiaries that are setup or obtained by the investment
|||||||||
|-|-|-|-|-|-|-|-|
|Type|Registration|Businessnature|Registeredcapital( Unit:RMB WanYuan）|BusinessScope|The Year End‘sactual amount ofcapital Investment|Balance of otherEssentiallyconstituting netInvestment inSubsidiary|Shareholdingproportion(%)|
|Stated-controlled|Nanjing|Trading|3,420.50|telecommunications|33,175,148.00||98.24|

||||||||
|-|-|-|-|-|-|-|
|Stated-controlled|Nanjing|Manufacture|1,130.14|telecommunications|5,610,000.00|60.00|
|Stated-controlled|Nanjing|Trading&Manufacture|1,400.00|telecommunications|13,860,000.00|99.98|
|Stated-controlled|Nanjing|Trading&Manufacture|1,200.00|telecommunications|3,320,003.45|45.77|
|Stated-controlled|Hongkong|Trading|HK 200.00|telecommunications|1,910,520.00|90.00|
|Stated-controlled|Beijing|Trading|USD 50.00|telecommunications|1,854,910.00|51.00|
|Stated-controlled|Nanjing|Trading&Manufacture|USD1,090.00|telecommunications|40,997,683.00|99.42|
|Stated-controlled|Nanjing|Trading&Manufacture|1,000.00|telecommunications|2,610,457.00|50.70|
|Stated-controlled|Nanjing|Trading&Manufacture|1,000.00|telecommunications|7,741,140.40|78.00|
|Stated-controlled|Nanjing|Trading&Manufacture|475.00|telecommunications|1,294,510.00|70.00|
||||||112,374,371.85||

(Continued)
||||
|-|-|-|
|statements combined or not|Minority interest|Amount in minority interest usedfor writing down minority gain andloss|
|Yes|1,911,555.27||
|Yes|0.00||
|Yes|1,018.52||

|||
|-|-|
|Yes|44,589,068.39|
|Yes||
|No||
|Yes|221,609.49|
|Yes|12,098,537.54|
|Yes|5,374,577.46|
|Yes|382,936.43|
||64,579,303.10|

(2) Subsidiaries obtained by combination under different control
||||||
|-|-|-|-|-|
|Type|Registration|Business nature|Registeredcapital( Unit: RMB WanYuan）|BusinessScope|
|Limitedcompany|Nanjing|Productand saleindustrialplugs,sockets|﹩5,200,000.00|Product industrial plugs,sockets, cable coupler,low-voltage distributionbox, cabinet accessories,and parts; sale ofself-produced products.And the main products areplugs and sockets forindustry|
|Limitedcompany|Nanjing|Productionandmarketingofelectronicproductsetc.|10,000,000.00|Software productdevelopment, productionand sales; electronicproduct development,production and sales;engineering and technicalservices; surface mountsoldering processingservices; propertymanagement; businessand agent all kinds of|

||||||
|-|-|-|-|-|
|Type|Registration|Business nature|Registered|Business|
||||capital( Unit: RMB WanYuan）|goods and tSeccophe nologyimport and export|

(Continued)
|||||||
|-|-|-|-|-|-|
|Balance of otherEssentiallyconstituting netInvestment inSubsidiary|Shareholdingproportion(%)|VotingRightsproportion(%)|statementscombinedor not|Minorityinterest|Amount inminority interestused for writingdown minoritygain and loss|
||75.00|75.00|Yes|20,674,259.85||
||40.00|40.00|Yes|13,477,161.35||

2. Description Changes in scope of consolidation
Instructions about changes in consolidation scope
√ Applicable □ Not applicable
（1）The subsidiaries in the scope of consolidation include half or less than half voting rights
||||
|-|-|-|
|Item|Voting rights|Reasons for consolidated|
|Nanjing Putian Datang InformationElectronics Co., Ltd.|40.00|Achieve control rights|

（2）The subsidiaries no longer in the scope of consolidation include half or more than half voting rights
None.
3. Newly included in the scope of consolidation of the subject and the issue is no longer included in the consolidation scope
Newly included subsidiaries, special purpose entities consolidated form of control by the trustee or leasing and other forms of
business entities
||||
|-|-|-|
|Name|Net asset|Net profit|
|Nanjing Putian Datang Information Electronics Co.,|||
||22,461,935.59|1,239,203.25|
|Ltd.|||

No longer included subsidiaries, special purpose entities consolidated form of control by the trustee or leasing and other forms of business entities.
4. Current occurred under the control of the same company merger
None.
5. Current businesses under common control combination occurs
||||
|-|-|-|
|Combined party|Amount of goodwill|Goodwill calculation method|

|||
|-|-|
||According to the share fair value of identifiable net assets|
|Nanjing Putian Datang Information||
||about the combined party on the merger date exceeds the|
|Electronics Co., Ltd.||
||cost of the combination|

6. Current sell stake in loss of control of a subsidiary reduced
None.
7. Reverse current period purchases
None.
8. Current merger occurs
None.
9. Conversion of foreign currency financial statement for accounting entity operation at oversea
Items of assets and liabilities shall be conversed at average exchange rate As of 30 June 2014, announced by Foreign Exchange Bureau in China. Items of equity shall be conversed at spot rate when occurring, except retained profit. Items of income statement shall be conversed at average exchange rate As of 30 June 2014 and As of 31 December 2013, announced by Foreign Exchange Bureau in China.
VII. Notes to the major items in the consolidated financial statements
1. Monetary funds
||||||||
|-|-|-|-|-|-|-|
||As of 30 June 2014|||As of 31 December 2013|||
|Item||Exchange|||||
||Original currency||RMB|Original currency|Exchange rate|RMB|
|||rate|||||
|Cash on hand|--|--|60,174.45|--|--|10,154.33|
|RMB|--|--|60,174.45|--|--|10,154.33|
|Cash in bank|--|--|303,434,172.06|--|--|369,426,901.36|
|RMB|--|--|294,895,573.89|--|--|359,396,286.96|
|USD|1,283,185.48|6.1528|7,895,183.62|1,409,644.88|6.0969|8,594,463.85|
|HKD|781,807.89|0.79375|620,560.01|843,665.32|0.78623|663,314.98|
|EUR|2,470.03|8.3946|20,734.88|91,548.13|8.4189|770,734.55|
|GBP|201.91|10.4978|2,119.66|208.94|10.0556|2,101.02|
|Other monetary funds|--|--|69,927,212.67|--|--|60,587,270.94|
|RMB|--|--|69,927,212.67|--|--|60,506,166.78|
|USD||||11,739.43|6.0969|71,574.13|
|EUR||||1,131.98|8.4189|9,530.03|
|Total|--|--|373,421,559.18|--|--|430,024,326.63|

 Other monetary funds
||||
|-|-|-|
|Item|As of 30 June 2014|As of 31 December 2013|
|Security deposit|69,927,212.67|60,587,270.94|
|Total|69,927,212.67|60,587,270.94|

2. Notes receivables
(1) Receivable by category list below
||||
|-|-|-|
|Item|As of 30 June 2014|As of 31 December 2013|
|Commercial acceptance bills|2,238,868.97|4,591,240.18|
|Bank acceptance bills|13,536,419.52|17,328,239.87|
|Total|15,775,288.49|21,919,480.05|

(2) Endorsed but not yet expired top five largest amount receivable listed below
||||||
|-|-|-|-|-|
|Remitter|Date of issue|Date of expiry|Amount|Memo|
|China Railway Electrification Bureau|||||
|Group, Beijing Construction Engineering|2014-06-18|2014-12-18|1,601,436.66||
|Co., Ltd.|||||
|Shanghai Yide Trade Co., Ltd.|2014-05-14|2014-11-13|1,000,000.00||
|China Telecom Co., Ltd. Hubei Branch|2014-03-28|2014-09-11|898,052.41||
|China Railway Electrification Bureau|||||
||2014-03-07|2014-09-07|570,868.00||
|Group Co., Ltd.|||||
|WISDRI (Wuhan) Automation Co., Ltd.|2014-03-11|2014-09-11|566,000.00||
|Total|--|--|4,636,357.07|--|

3. Accounts receivable
(1)Classification of accounts receivable
||||||||||
|-|-|-|-|-|-|-|-|-|
||As of 30 June 2014||||As of 31 December 2013||||
||Book balance||Provision for bad debts||Book balance||Provision for bad debts||
|Classification|||||||||
|||Proportion||Proportion||Proportion||Proportion|
||Amount||Amount||Amount||Amount||
|||(%)||(%)||(%)||(%)|
|Classification as the group of provision for account receivable|||||||||
|Group1|245,302,379.95|26.16%|||192,459,984.01|23.78%|||
|Group 2|578,157,493.09|61.66%|||567,532,079.05|70.12%|||
|Group 3|106,024,401.34|11.31%|13,260,055.64|12.51%|41,256,568.97|5.10%|11,264,630.48|27.30%|
|Subtotal|929,484,274.38|99.13%|13,260,055.64|1.43%|801,248,632.03|99.00%|11,264,630.48|1.41%|
|Single amount not significant|||||||||
|but single provision for|8,146,734.29|0.87%|8,146,734.29|100.00%|8,101,537.99|1.00%|8,101,537.99|100.00%|
|accounts receivable|||||||||
|Total|937,631,008.67|--|21,406,789.93|--|809,350,170.02|--|19,366,168.47|--|

Notes：Single amount dramatic and individual provision for accounts receivable refers to single exceed RMB 10,000,000.00 Yuan, test no impairment, the company according to age analysis accrual impairment provision. According to the group of receivables provision for more than 2 years of age receivables, via test no impairment, according to age analysis accrual impairment provision.
||||||||
|-|-|-|-|-|-|-|
||As of 30 June 2014|||As of 31 December 2013|||
||Book balance|||Book balance|||
|Age||||||Provision for bad|
|||Proportion(%)|Provision for bad debts||Proportion||
||Amount|||Amount||debts|
||||||(%)||
|Within 1 year|224,726,293.13|63.96%||172,114,115.60|73.64%||

||||||||
|-|-|-|-|-|-|-|
|(contain 1 year)|||||||
|1 to 2 years|84,319,010.63|24.00%||35,147,789.37|15.04%||
|2 to 3 years|24,189,786.26|6.89%|2,418,978.51|10,439,624.42|4.47%|1,043,962.46|
|3 to 4years|18,091,691.27|5.15%|10,841,077.13|16,015,023.59|6.85%|10,220,668.02|
|4 to 5 years|7,294,486.75|2.08%|2,188,346.07|4,604,420.43|1.97%|1,381,326.14|
|5 to 6 years|2,995,806.26|0.85%|1,198,322.56|3,030,610.69|1.30%|1,212,244.29|
|6 years or|||||||
||7,801,398.26|2.22%|7,454,408.50|8,379,992.47|3.58%|7,627,097.59|
|above|||||||
|Total|351,326,781.29|--|13,260,055.64|233,716,552.98|--|11,264,630.48|

 Closing single amount not significant but single provision for accounts receivable
||||||
|-|-|-|-|-|
|Receivables|Book amount|Bad debt|Proportion (%)|Reason|
|M/S Whlstler Telecom(pvt)||||Aging longer cannot be|
||1,724,928.12|1,724,928.12|100.00%||
|LTD||||recalled|
|||||Aging longer cannot be|
|NEPAL TETE|1,499,774.77|1,499,774.77|100.00%||
|||||recalled|
|Jiangsu Changzhou Dahua||||Aging longer cannot be|
||1,346,323.87|1,346,323.87|100.00%||
|Co.||||recalled|
|Hubei Provincial Public||||Aging longer cannot be|
||812,432.82|812,432.82|100.00%||
|Security||||recalled|
|||||Aging longer cannot be|
|XI'AN Overload Science|599,043.99|599,043.99|100.00%||
|||||recalled|
|Beijing Tongchengdaye|||||
|||||Aging longer cannot be|
|Communication Technology|486,001.22|486,001.22|100.00%||
|||||recalled|
|Co., Ltd.|||||
|Jiangsu Taihewei Nets||||Aging longer cannot be|
||419,504.72|419,504.72|100.00%||
|Technology Co., Ltd.||||recalled|
|Taiyuan High-tech Industry||||Aging longer cannot be|
||246,868.39|246,868.39|100.00%||
|Import and Export Co||||recalled|
|Nanjing Zhongjiang||||Aging longer cannot be|
||223,600.00|223,600.00|100.00%||
|Construction Group Co., Ltd.||||recalled|
|Suzhou Tailong Real Estate||||Aging longer cannot be|
||159,322.80|159,322.80|100.00%||
|Development Co.||||recalled|
|Heilongjiang Blue Ocean|||||
|||||Aging longer cannot be|
|Silver Ann technology|155,111.86|155,111.86|100.00%||
|||||recalled|
|Development Co., LTD|||||

||||||
|-|-|-|-|-|
|Beijing Zhenyuan Innovation|||||
|||||Aging longer cannot be|
|Science and Technology|150,187.22|150,187.22|100.00%||
|||||recalled|
|Development Co|||||
|Zhongshan Group||||Aging longer cannot be|
||115,921.14|115,921.14|100.00%||
|International Trade Center||||recalled|
|||||Aging longer cannot be|
|PRADUFA|100,182.00|100,182.00|100.00%||
|||||recalled|
|Shandong University of|||||
|||||Aging longer cannot be|
|Traditional Chinese|64,868.40|64,868.40|100.00%||
|||||recalled|
|Medicine|||||
|Changchun Jiachen|||||
|||||Aging longer cannot be|
|Network Technology Co.,|30,162.97|30,162.97|100.00%||
|||||recalled|
|LTD|||||
|China Unicom Nanjing||||Aging longer cannot be|
||12,500.00|12,500.00|100.00%||
|Branch||||recalled|
|Total|8,146,734.29|8,146,734.29|--|--|

(2) Current payback or return of receivables
None.
Closing single amount not significant but single provision for accounts receivable
||||||
|-|-|-|-|-|
|Receivables|Book amount|Bad debt|Proportion (%)|Reason|
|M/S Whlstler Telecom(pvt)||||Aging longer cannot be|
||1,724,928.12|1,724,928.12|100.00%||
|LTD||||recalled|
|||||Aging longer cannot be|
|NEPAL TETE|1,499,774.77|1,499,774.77|100.00%||
|||||recalled|
|Jiangsu Changzhou Dahua||||Aging longer cannot be|
||1,346,323.87|1,346,323.87|100.00%||
|Co.||||recalled|
|Hubei Provincial Public||||Aging longer cannot be|
||812,432.82|812,432.82|100.00%||
|Security||||recalled|
|||||Aging longer cannot be|
|XI'AN Overload Science|599,043.99|599,043.99|100.00%||
|||||recalled|
|Beijing Tongchengdaye|||||
|||||Aging longer cannot be|
|Communication Technology|486,001.22|486,001.22|100.00%||
|||||recalled|
|Co., Ltd.|||||
|Jiangsu Taihewei Nets||||Aging longer cannot be|
||419,504.72|419,504.72|100.00%||
|Technology Co., Ltd.||||recalled|
|Taiyuan High-tech Industry||||Aging longer cannot be|
||246,868.39|246,868.39|100.00%||
|Import and Export Co||||recalled|

||||||
|-|-|-|-|-|
|Nanjing Zhongjiang||||Aging longer cannot be|
||223,600.00|223,600.00|100.00%||
|Construction Group Co., Ltd.||||recalled|
|Suzhou Tailong Real Estate||||Aging longer cannot be|
||159,322.80|159,322.80|100.00%||
|Development Co.||||recalled|
|Heilongjiang Blue Ocean|||||
|||||Aging longer cannot be|
|Silver Ann technology|155,111.86|155,111.86|100.00%||
|||||recalled|
|Development Co., LTD|||||
|Beijing Zhenyuan Innovation|||||
|||||Aging longer cannot be|
|Science and Technology|150,187.22|150,187.22|100.00%||
|||||recalled|
|Development Co|||||
|Zhongshan Group||||Aging longer cannot be|
||115,921.14|115,921.14|100.00%||
|International Trade Center||||recalled|
|||||Aging longer cannot be|
|PRADUFA|100,182.00|100,182.00|100.00%||
|||||recalled|
|Shandong University of|||||
|||||Aging longer cannot be|
|Traditional Chinese|64,868.40|64,868.40|100.00%||
|||||recalled|
|Medicine|||||
|Changchun Jiachen|||||
|||||Aging longer cannot be|
|Network Technology Co.,|30,162.97|30,162.97|100.00%||
|||||recalled|
|LTD|||||
|China Unicom Nanjing||||Aging longer cannot be|
||12,500.00|12,500.00|100.00%||
|Branch||||recalled|
|Total|8,146,734.29|8,146,734.29|--|--|

(3) The income in the actual cancel after verification of receivables
None.
(4) Accounts receivable due from shareholder who has more than5% (including 5%) voting shares of the Company at year-end
||||||
|-|-|-|-|-|
||As of 30 June 2014||As of 31 December 2013||
|Name|||||
||Book amount|Bad debt|Book amount|Bad debt|
|China Potevio Information Industry Co.,|||||
||23,171,706.49|100,904.72|24,187,722.30|2,936.37|
|Ltd.|||||
|Total|23,171,706.49|100,904.72|24,187,722.30|2,936.37|

 (5)Top 5 debtors of accounts receivable
||||||
|-|-|-|-|-|
||Relationship with the|||Proportion of total amount|
|Name of the debtors||Amount|Aging||
||Company|||(%)|
|China Telecom Co., Ltd.|non-related party|109,059,323.32|within 1 year|11.63%|

||||||
|-|-|-|-|-|
|Jiangsu Branch|||||
|Agricultural Bank of China|non-related party|35,302,050.79|within 2 year|3.77%|
|China Potevio Information|||||
||parent company|23,171,706.49|within 4 year|2.47%|
|Industry Co., Ltd.|||||
|China Telecom Co., Ltd.|||||
||non-related party|16,968,052.69|within 4 year|1.81%|
|Henan Branch|||||
|Nanjing Hehao|||||
|Communication Technology|non-related party|16,741,407.40|1 to 2 year|1.79%|
|Co., Ltd.|||||
|Total|--|201,242,540.69|--|21.47%|

 (6) Accounts receivable of related parties accounts
|||||
|-|-|-|-|
|Name of the debtors|Relationship with the Company|Amount|Proportion of total amount (%)|
|China Potevio Information||||
||Parent company|23,171,706.49|2.47%|
|Industry Co., Ltd.||||
|Shanghai Putian Post and||||
|Telecommunications Technology||13,341,700.00|1.42%|
|Co., Ltd.|Under the same parent company|||
|Shanghai Putian Network||||
|||803,719.70|0.09%|
|Technology Co,. Ltd|Under the same parent company|||
|Putian Information Technology||||
|||80,784.00|0.01%|
|Research Institute Co., Ltd|Under the same parent company|||
|Total|--|37,397,910.19|3.99%|

 (7) Balance of accounts receivable in foreign currencies
||||||||
|-|-|-|-|-|-|-|
|ForeignCurrency|As of 30 June 2014|||As of 31 December 2013|||
||Original currency|Exchange rate|RMB|Original currency|Exchange rate|RMB|
|USD|1,083,624.05|6.15|6,667,322.05|775,067.49|6.0969|4,725,508.98|
|Total|——|——|6,667,322.05|——|——|4,725,508.98|

4. Other receivables
(1)Classification of other receivables
||||||||||
|-|-|-|-|-|-|-|-|-|
||As of 30 June 2014||||As of 31 December 2013||||
||Book balance||Provision for bad debts||Book balance||Provision for bad debts||
|Classification|||||||||
|||Proportion(%)||Proportion||Proportion(%)||Proportion|
||Amount||Amount||Amount||Amount||
|||||(%)||||(%)|

||||||||||
|-|-|-|-|-|-|-|-|-|
|Individually significant and|||||||||
|individual provision for the|28,912,122.71|35.21%|28,912,122.71|100.00%|28,912,122.71|29.27%|28,912,122.71|100.00%|
|accounts receivable|||||||||
|Classification as the group of provision for account receivable|||||||||
|Group1|12,000,000.00|14.62%|4,800,000.00|40.00%|45,664,951.95|46.24%|6,400,000.00|14.02%|
|Group 2|26,779,042.58|32.62%|||13,091,792.41|13.26%|||
|Group 3|14,411,287.05|17.55%|6,605,126.13|45.83%|11,095,426.52|11.23%|5,360,559.45|48.31%|
|Subtotal|53,190,329.63|64.79%|11,405,126.13|21.44%|69,852,170.88|70.73%|11,760,559.45|16.84%|
|Total|82,102,452.34|--|40,317,248.84|--|98,764,293.59|--|40,672,682.16|--|

Notes：Single amount dramatic and individual provision for other receivable refers to single exceed RMB 10,000,000.00 Yuan, test no impairment, the company according to age analysis accrual impairment provision. According to the group of other receivables provision for more than 2 years of age receivables, via test no impairment, according to age analysis accrual impairment provision.
Closing single amount significant and single provision for accounts receivable
||||||
|-|-|-|-|-|
|Name of debtors|Amount|Provision|Proportion|Reason|
|Beijing Picom|||||
|||||Aging longer cannot berecalled|
|Telecommunications|28,912,122.7|1 28,912,122.71|100.00%||
|Equipment Ltd|||||
|Total|28,912,122.7|1 28,912,122.71||— —|

Adopt age analysis provision in group as follows:
||||||||
|-|-|-|-|-|-|-|
||As of 30 June 2014|||As of 31 December 2013|||
||Book balance|||Book balance|||
||||Provision for bad||||
|Age|||||||
|||Proportion|debts||Proportion|Provision for bad|
||Amount||||||
|||(%)|Book balance|Amount|(%)|debts|
|Within 1 year (contain|||||||
||790,646.21|2.99%||15,919,860.38|28.04%||
|1 year)|||||||
|1 to 2 years|557,128.84|2.11%||14,839,036.04|26.14%||
|2 to 3 years|3,876,109.19|14.68%|387,610.93|1,763,147.23|3.11%|176,314.72|
|3 to 4years|21,187,402.81|80.22%|11,017,515.20|24,238,334.82|42.71%|11,584,244.73|
|4 to 5 years|1,622,394.42|6.14%|486,718.34|2,727,959.45|4.81%|818,387.84|
|5 to 6 years|14,626,679.10|55.38%|5,850,671.64|17,683,802.20|31.16%|7,073,520.88|
|6 years or above|4,938,329.29|18.70%|4,680,125.22|3,826,573.17|6.74%|3,692,336.01|
|Total|26,411,287.05|--|11,405,126.13|56,760,378.47|--|11,760,559.45|

(2) Recovery or reversal of current other receivables
None of recovery or reversal of current other receivables with full provision for bad debts or a larger percentage of provision for bad debts before and recovery or reversal of them this year, as well a larger percentage of recovery or reversal this year.
Closing single amount significant and single provision for accounts receivable
||||||
|-|-|-|-|-|
|Name of debtors|Amount|Provision for bad debts|Proportion|Reason|
|Beijing Picom|||||
|||||Aging longer cannot be|
|Telecommunications|28,912,122.71|28,912,122.71|100.00%||
|||||recalled|
|Equipment Ltd|||||
|Total|28,912,122.71|28,912,122.71||——|

(3) Other accounts due from shareholder who has more than5% (including 5%) voting shares of the Company at 30 June 2014
||||||
|-|-|-|-|-|
||As of 30 June 2014||As of 31 December 2013||
|Name of debtors|||||
||Amount|Provision for bad debts|Amount|Provision for bad debts|
|China Potevio Information Industry Co.,|||||
||360,680.00|0.00|17,500.00|0.00|
|Ltd.|||||
|Total|360,680.00|0.00|17,500.00|0.00|

 (4)Contents or types of other receivables with larger amount
|||||
|-|-|-|-|
|||Type (or contents) of other||
|Name of debtors|Amount||Proportion|
|||receivables||
|Beijing Picom Telecommunications||||
||28,912,122.71|Receivables and payables|35.21%|
|Equipment Ltd||||
|The Yuhua People's Government||||
||12,000,000.00|Receivables and payables|14.62%|
|Nanning Office||||
|Total|40,912,122.71|--|49.83%|

 (5) Top 5 debtors of other receivables
||||||
|-|-|-|-|-|
||Relationship with the|||Proportion of total amount|
|Name of debtors||Amount|Aging||
||Company|||(%)|
|Beijing Picom|||||
|Telecommunications|Related party|28,912,122.71|Over 6 years|35.21%|
|Equipment Ltd|||||
|The Yuhua People's|||||
||Non-related party|12,000,000.00|4 to 5 years|14.62%|
|Government Nanning Office|||||
|Henan Zhongguang|||||
|Information Network Co.,|Non-related party|1,000,000.00|Over 6 years|1.22%|
|Ltd.|||||

||||||
|-|-|-|-|-|
|China Mobile Group Jiangsu|||||
||Non-related party|730,000.00|Within 1 year|0.89%|
|Co., Ltd. Nanjing Branch|||||
|China Mobile Group Jiangsu|||||
||Non-related party|250,000.00|Over 6 years|0.30%|
|Co., Ltd. Nanjing Branch|||||
|China United Network|||||
|Communications Co., Ltd.|Non-related party|730,000.00|Within 5 year|0.89%|
|Liaoning Branch|||||
|Total|--|43,622,122.71|--|53.13%|

 (6) Other receivables from related parties
|||||
|-|-|-|-|
|Name of debtors|Relationship with the Company|Amount|Proportion of total amount (%)|
|Beijing Picom||||
|Telecommunications Equipment||28,912,122.71|35.21%|
|Ltd|Related party|||
|China Potevio Information||||
|||360,680.00|0.44%|
|Industry Co., Ltd.|Parent company|||
|Total|--|29,272,802.71|35.65%|

 (7)Balance of other receivables in foreign currencies
None
5. Prepayments
(1)Analysis of aging
||||||
|-|-|-|-|-|
||As of 30 June 2014||As of 31 December 2013||
|Aging|||||
||Amount|Percentage (%)|Amount|Percentage (%)|
|Within 1 year|22,670,075.76|62.59%|19,368,994.01|58.44%|
|1-2 years|6,251,866.38|17.26%|8,942,129.35|26.98%|
|2-3 years|3,840,870.29|10.61%|2,878,492.17|8.68%|
|over 3 years|3,455,168.48|9.54%|1,955,239.29|5.90%|
|Total|36,217,980.91|--|33,144,854.82|--|

 (2)Top five largest accounts paid in advance
||||||
|-|-|-|-|-|
||Relationship with the||||
|Company||Amount|Aging|Reasons for un-settlement|
||Company||||
|Jiangsu Wujin Construction|||||
||non-related party|4,708,400.00|within 2 years|In credit period|
|and Installation Engineering|||||

||||||
|-|-|-|-|-|
|Co., Ltd.,|||||
|Jiangsu Huayu Intelligent|||||
|Systems Engineering Co.,|non-related party|2,303,277.50|within 3 years|In credit period|
|Ltd.|||||
|Nanjing Rui Yi Technology|||||
||non-related party|1,230,000.00|within 1 year|In credit period|
|Co., Ltd.|||||
|Honeywell Security (China)|||||
||non-related party|1,136,553.24|within 1 year|In credit period|
|Co., Ltd. Shanghai Branch|||||
|Lanzhou Xinyuan Electric|||||
||non-related party|1,000,000.00|within 1 year|In credit period|
|Power Equipment Co., Ltd.|||||
|Total|--|10,378,230.74|--|--|

(3) Prepayment of shareholder who has more than5% (including 5%) voting shares of the Company at year-end None.
6. Inventories
(1)Classification of inventories
||||||||
|-|-|-|-|-|-|-|
||As of 30 June 2014|||As of 31 December 2013|||
|Item||Provision for|||Provision for||
||Book balance||Book value|Book balance||Book value|
|||devaluation|||devaluation||
|Raw materials|41,697,587.67|1,510,725.67|40,186,862.00|38,013,219.98|1,510,725.67|36,502,494.31|
|Goods-in-|||||||
||132,089,201.70||132,089,201.70|262,382,981.59||262,382,981.59|
|process|||||||
|Finished goods|292,833,749.85|6,781,903.56|286,051,846.29|138,980,558.36|6,854,637.93|132,125,920.43|
|Total|466,620,539.22|8,292,629.23|458,327,909.99|439,376,759.93|8,365,363.60|431,011,396.33|

 (2) Provision for inventory devaluation
|||||||
|-|-|-|-|-|-|
||As of 31 December|Amount provided this|Amount reduced this year|||
|Item|||||As of 30 June 2014|
||2013|year|Reversal|Reversal||
|Raw materials|1,510,725.67||||1,510,725.67|
|Finished goods|6,854,637.93||72,734.37||6,781,903.56|
|Total|8,365,363.60||72,734.37||8,292,629.23|

 (3) Inventory devaluation case
|||||
|-|-|-|-|
|Item|Provision for inventory impairment|Reasons for the reversal of|Percentage (%)|

||||
|-|-|-|
|||inventory impairment|
|Raw materials|Net realizable value||
|||Impairment on inventory of|
|Finished goods|Net realizable value||
|||merchandise has been sold|

7. Long-term equity investments of the joint ventures and associated ventures
|||||||||
|-|-|-|-|-|-|-|-|
|||Voting right||||||
||Share holding|proportion of the|Total assets at||Total net assets|||
|||||Total liabilities 31||Total sales of|Net profit of this|
|Invested units|percentage of|company among|31 December||31 December|||
|||||December 2013||this period|period|
||the company (%)|invested units|2013||2013|||
|||(%)||||||
|Information of the joint ventures||||||||
|Nanjing Prachanda||||||||
|Live Optical|50.00%|50.00%|68,204,417.89|42,700,915.91|25,503,501.98|12,863,084.55|-1,978,976.75|
|Network Co., Ltd.||||||||
|Information of the associated ventures||||||||
|Nanjing Putian||||||||
|Zhongyou||||||||
||30.00%|30.00%|1,370,139.44|99,297.63|1,270,841.81|42,461.55|-30,110.24|
|Telecommunication||||||||
|Co., Ltd.||||||||
|Nanjing Putian||||||||
|High Technology|49.64%|49.64%|343,842,315.89|3,220,015.49|340,622,300.40|7,720,975.78|524,809.72|
|Industry Co., Ltd.||||||||
|Nanjing Putian||||||||
|Telege Cable Co.,|45.00%|45.00%|7,788,172.52|1,865,028.24|5,923,144.28|4,942,276.42|155,401.41|
|Ltd.||||||||

8. Long-term equity investments
(1)List of Information of Long-term Equity Investment
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
||||||||Voting|Interpretati||||
|||||||Shareholdingpercentage of theCompany amonginvestedunits (%)||||||
||||||||right|ons of||||
|||||||||||Depreciati||
||||Bookbalance at||||proporti|difference|||Cash|
||||||Book|||||on||
||Accounti||||||on of|between|||dividend|
|||Initial cost of|||balance at||||Depreciati|reserves||
|Invested units|ng||31|Movement|||the|the equity|||during|
|||investment|||30 June||||on reserve|withdrawn||
||Method||December2013||||Compa|percentage|||the|
||||||2014|||||during the||
||||||||ny|an d vote|||period|
|||||||||||period||
||||||||among|right||||
||||||||invested|percentage||||

||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
||||||||units|in the|||
||||||||(%)|invested|||
|||||||||unit|||
|Nanjing Putian|||||||||||
|Datang|||||||||||
||Cost|5,212,328.8|4,326,243.6|-4,326,243.|||||||
|Information and||||||40.00%|40.00%||||
||Method|0|4|64|||||||
|Electric|||||||||||
|Company Ltd|||||||||||
|Nanjing Putian|||||||||||
|Zhongyou|Equity||||||||||
|||300,000.00|219,528.61||219,528.61|30.00%|30.00%||||
|Telecommunicati|Method||||||||||
|on Co., Ltd.|||||||||||
|Nanjing Putian|||||||||||
|High Technology|Equity|167,548,141|168,922,896||168,885,571|||||297,840.|
|||||-37,324.45||49.64%|49.64%||||
|Industry Co.,|Method|.29|.40||.95|||||00|
|Ltd.|||||||||||
|Nanjing|||||||||||
|Prachanda Live|Equity|13,544,400.|13,740,859.|-989,488.3|12,751,371.||||||
|||||||50.00%|50.00%||||
|Optical Network|Method|00|91|8|53||||||
|Co., Ltd|||||||||||
|Beijing Picom|||||||||||
||Cost|1,854,910.0|1,854,910.0||1,854,910.0||||1,854,910.||
|Telecommunicati||||||51.00%|51.00%||||
||Method|0|0||0||||00||
|ons|||||||||||
|Nanjing Yuhua|||||||||||
||Cost||||||||||
|Galvanization||420,915.00|420,915.00||420,915.00|10.00%|10.00%||||
||Method||||||||||
|Factory|||||||||||
|Hangzhou|||||||||||
|Putian Swanking|Cost||||||||||
|||321,038.00|321,038.00||321,038.00|2.26%|2.26%||||
|Electrical Co.,|Method||||||||||
|Ltd|||||||||||
|Nanjing Putian|Cost||||||||||
|||181,701.84||||0.00%|0.00%||||
|Industry Co., Ltd|Method||||||||||
|Nanjing Putian|||||||||||
||Equity|2,250,000.0|2,595,484.2||2,665,414.9||||||
|Telege Cable||||69,930.63||45.00%|45.00%||||
||Method|0|8||1||||||
|Co., Ltd.|||||||||||
|||191,633,434|192,401,875|-5,283,125.|187,118,750.||||1,854,910.|297,840.|
|Total|--|||||--|--|--|||
|||.93|.84|84|00||||00|00|

(2)Explanation of Long-term Equity Investment
There is no long-term equity investment with restriction for sale at the end of this period.
9. Investment property
Investment properties measured at costs
||||||
|-|-|-|-|-|
||||Decrease during the||
|Item|As of 31 December 2013|Increase during the year||As of 30 June 2014|
||||year||
|Total original cost|10,032,417.29|7,237,046.93||17,269,464.22|
|Houses and buildings|6,390,269.42|7,237,046.93||13,627,316.35|
|Land use rights|3,642,147.87|||3,642,147.87|
|Total accumulated|||||
|depreciation and|3,788,683.18|739,589.66||4,528,272.84|
|accumulated amortization|||||
|Houses and buildings|2,503,951.87|679,609.34||3,183,561.21|
|Land use rights|1,284,731.31|59,980.32||1,344,711.63|
|Total book value|6,243,734.11|6,497,457.27||12,741,191.38|
|Houses and buildings|3,886,317.55|6,557,437.59||10,443,755.14|
|Land use rights|2,357,416.56|-59,980.32||2,297,436.24|
|Total accumulated|||||
||1,842,418.00|||1,842,418.00|
|provision for impairment|||||
|Houses and buildings|1,842,418.00|||1,842,418.00|
|Total carrying value|4,401,316.11|6,497,457.27||10,898,773.38|
|Houses and buildings|2,043,899.55|||8,601,337.14|
|Land use rights|2,357,416.56|||2,297,436.24|

 10. Fixed assets
(1)Lists of fixed assets and accumulated depreciation, including movement
||||||
|-|-|-|-|-|
||As of 31 December|Increase|Decrease||
|Item||||As of 30 June 2014|
||2013|during the year|during the year||
|Total original cost of fixed|||||
||267,398,407.23|15,715,227.33|639,495.11|282,474,139.45|
|assets|||||
|Building/structure|122,596,766.53|7,436,426.36|96,844.00|129,936,348.89|
|Machinery equipment|75,269,719.32|6,053,969.11||81,323,688.43|
|Transportation equipment|14,928,617.08|620,820.16|428,107.17|15,121,330.07|
|Others|54,603,304.30|1,604,011.70|114,543.94|56,092,772.06|

|||||||
|-|-|-|-|-|-|
|Total accumulated depreciation|158,428,251.86|4,511,855.71|5,653,114.69|507,967.83|168,085,254.43|
|Building/structure|41,935,628.45|884,889.26|2,322,055.65|18,265.85|45,124,307.51|
|Machinery equipment|60,756,778.65|3,002,815.66|1,996,873.35||65,756,467.66|
|Transportation equipment|10,640,534.98|329,918.62|662,164.60|385,296.45|11,247,321.75|
|Others|45,095,309.78|294,232.17|672,021.09|104,405.53|45,957,157.51|
|Total net book value of fixed||||||
||108,970,155.37|--|||114,388,885.02|
|assets||||||
|Building/structure|80,661,138.08|--|||84,812,041.38|
|Machinery equipment|14,512,940.67|--|||15,567,220.77|
|Transportation equipment|4,288,082.10|--|||3,874,008.32|
|Others|9,507,994.52|--|||10,135,614.55|
|Total impairment of fixed assets|2,359,652.66|--|||2,359,652.66|
|Building/structure|539,124.00|--|||539,124.00|
|Machinery equipment|573,461.78|--|||573,461.78|
|Others|1,247,066.88|--|||1,247,066.88|
|Total carrying value of fixed|106,610,502.71||||112,029,232.36|
|||--||||
|assets||||||
|Building/structure|80,122,014.08|--|||84,272,917.38|
|Machinery equipment|13,939,478.89|--|||14,993,758.99|
|Transportation equipment|4,288,082.10|--|||3,874,008.32|
|Others|8,260,927.64|--|||8,888,547.67|

 Note: The depreciation amount is RMB 5,653,114.69 Yuan, in this period there was RMB 0.00 Yuan construction in progress turn to fixed assets. (2)Fixed assets not in use temporarily
None
(3) Information of Fixed Assets without Certificate of Title
||||
|-|-|-|
|Item|Reasons for no secured property right certificate|Estimated Time to Complete Certificate ofTitle|
|Production houses|No certification of land use right||
|Structures|No certification of land use right||
|Non-production houses|No certification of land use right||
|Total|||

11. Construction in progress
(1)Basic information of Construction in progress
||||||||
|-|-|-|-|-|-|-|
||As of 30 June 2014|||As of 31 December 2013|||
|Item||Impairmentprovision|||Impairment||
||Book balance||Book value|Book balance||Book value|
||||||provision||
|Nanjing Putian Yuhua Venture|||||||
||16,893,907.29||16,893,907.29|15,543,477.29||15,543,477.29|
|park|||||||
|Cable production line|614,290.58||614,290.58|614,290.58||614,290.58|
|Total|17,508,197.87||17,508,197.87|16,157,767.87||16,157,767.87|

 (2) Significant movement of construction in progress
||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|
|||||||Proportion of|||||||
||||||||||Including||||
|||||||||Accumulat|||||
|||||Transf|||||interest|Interest|||
|||As of 31|Increase||Other|project|Accumulat|ed amount|||||
||Budg|||er to|||||capitalize|capitalizati|Capital|As of 30|
|Item||December|during the||decreas|Investme|ed|of interest|||||
||et|||fixed|||||d amount|on rate of|source|June 2014|
|||2013|year||e|nt in|progress|capitalizati|||||
|||||assets|||||of the|the year|||
|||||||budget(%)||on|||||
||||||||||year||||
|Nanjing|||||||||||||
|Putian|||||||||||||
|||15,543,477.|1,350,430.||||||||Self-owne|16,893,907.|
|Yuhua|||||||||||||
|||29|00||||||||d|29|
|Venture|||||||||||||
|park|||||||||||||
|Cable|||||||||||||
||||||||||||Self-owne||
|productio||614,290.58||||||||||614,290.58|
||||||||||||d||
|n line|||||||||||||
|||16,157,767.|1,350,430.|||||||||17,508,197.|
|Total||||||--|--|||--|--||
|||87|00|||||||||87|

 12. Intangible assets
||||||
|-|-|-|-|-|
||||Decrease during the||
|Item|As of 31 December 2013|Increase during the year||As of 30 June 2014|
||||year||
|Total original cost|43,638,112.72|5,049,141.66||48,687,254.38|
|Land use right|26,841,664.95|5,049,141.66||31,890,806.61|
|Exclusive technology|6,600,762.11|||6,600,762.11|
|Software|10,195,685.66|||10,195,685.66|
|Total accumulated amortization|19,335,697.17|1,057,210.80||20,392,907.97|
|Land use right|4,930,820.80|728,780.31||5,659,601.11|
|Exclusive technology|5,912,794.24|||5,912,794.24|

|||||
|-|-|-|-|
|Software|8,492,082.13|328,430.49|8,820,512.62|
|Total net book value|24,302,415.55|3,991,930.86|28,294,346.41|
|Land use right|21,910,844.15|4,320,361.35|26,231,205.50|
|Exclusive technology|687,967.87||687,967.87|
|Software|1,703,603.53|-328,430.49|1,375,173.04|
|Total accumulated provision for||||
||0.00||0.00|
|impairment||||
|Land use right||||
|Exclusive technology||||
|Software||||
|Total carrying value|24,302,415.55|3,991,930.86|28,294,346.41|
|Land use right|21,910,844.15|4,320,361.35|26,231,205.50|
|Exclusive technology|687,967.87||687,967.87|
|Software|1,703,603.53|-328,430.49|1,375,173.04|

 Note: The amortization amount of the intangible assets this year is RMB 656,070.80Yuan.
13. Details of asset impairment
|||||||
|-|-|-|-|-|-|
||As of 31 December2013|Amount provided this|Amount reduced this period|||
|Item|||||As of 30 June 2014|
|||period|Reversal|Written off||
|Bad debts reserve|60,038,850.63|1,777,312.46|534,911.54||61,281,251.55|
|Provision for inventory|8,365,363.60||72,734.37||8,292,629.23|
|devaluation||||||
|Provision of long-term equity|||||1,854,910.00|
||1,854,910.00|||||
|investments||||||
|Provision of investment property|1,842,418.00||||1,842,418.00|
|Provision of fixed assets|2,359,652.66||||2,359,652.66|
|Provision of intangible assets|0.00||||0.00|
|Total|74,461,194.89|1,777,312.46|607,645.91||75,630,861.44|

 14. Lists of all assets with restriction of certificate of title or use right
||||
|-|-|-|
|Item|As of 30 June 2014|Reasons for restriction of certificate of title or use right|
|Used to guarantee the assets|||
|Real estate|57,853,072.44|For loan security|

||||
|-|-|-|
|Land|11,318,933.67|For loan security|
|Others causes ownership restrictions assets|||
|Total|69,172,006.11||

15. Short-term loans
Short-term borrowings classified by listed below
||||
|-|-|-|
|Item|As of 30 June 2014|As of 31 December 2013|
|Loan in mortgage|81,000,000.00|78,000,000.00|
||404,000,000.00|384,000,000.00|
|Guaranteed loan|||
||485,000,000.00|462,000,000.00|
|Total|||

Notes:
1、To obtain the two bank short-term loan of RMB 32,000,000.00 Yuan, the company will mortgage two real estates, confirmed the total value of RMB32,138,800 Yuan of real estate. The loan period is from 26 May 2014 to 26 May 2015. The subsidiaries Nanjing Putian Telege Cable Co., Ltd. mortgaged its real estate for loan of RMB 35,000,000.00 Yuan, Nanjing Mennekes Electric Appliances Co., Ltd. mortgaged its real estate for loan of RMB 11,000,000.00 Yuan, and Nanjing Putian Datang Information Electric Co., Ltd. mortgaged its real estate for loan of RMB 3,000,000.00 Yuan.
2、The parent company China Potevio Information Industry Co., Ltd. guaranteed the borrowing of RMB 324,000,000.00 Yuan. The company guaranteed the borrowing of RMB 60,000,000.00 Yuan for Nanjing Southern Telecommunications Company Ltd. and the borrowing of RMB 20,000,000.00 Yuan for Nanjing Putian Telege Cable Co., Ltd .
16. Notes payable
||||
|-|-|-|
|Item|As of 30 June 2014|As of 31 December 2013|
|Commercial acceptance bills|15,529,854.40|25,529,854.40|
|Bank acceptance bills|85,800,417.90|45,279,794.10|
|Total|101,330,272.30|70,809,648.50|

 Notes: Notes payable closing balance next accounting periods expire the amount of the RMB101,330,272.30 Yuan.
17. Accounts payable
(1)Analysis of aging
||||
|-|-|-|
|Item|As of 30 June 2014|As of 31 December 2013|
|Within 1 year|670,510,835.27|870,502,221.95|
|1-2 years|286,478,009.82|65,499,246.98|
|2-3 years|23,997,952.50|8,263,933.47|
|over 3 years|11,356,944.57|11,512,125.97|

||||
|-|-|-|
|Total|992,343,742.16|955,777,528.37|

 (2) Accounts payable to shareholders holding5% or above voting shares of the Company
||||
|-|-|-|
|Item|As of 30 June 2014|As of 31 December 2013|
|China Potevio Information Industry Co., Ltd.|21,290,106.90|21,290,106.90|
|Total|21,290,106.90|21,290,106.90|

 (3)Significant accounts payable with ageing over one year as at year-end
|||||
|-|-|-|-|
|Name|Amount|Aging|Other payables nature or content|
|Nanjing Prachanda Live Optical Network Co.,Ltd|12,829,454.32|Within 1 year|Purchase payable|
||36,868,794.71|1 to 2 year|Purchase payable|
||1,622,336.00|2 to 3 year|Purchase payable|
|Beijing Xinliwen Science and TechnologyDevelopment Co., Ltd.|12,282,184.00|Within 1 year|Purchase payable|
||14,378,874.74|1 to 2 year|Purchase payable|
|China Potevio Information Industry Co., Ltd.|17,290,106.90|1 to 2 year|Purchase payable|
||4,000,000.00|Over 3 years|Purchase payable|
|Nanjing Hua Heng Electric Control EquipmentCo., Ltd.|7,514,725.87|Within 1 year|Purchase payable|
||12,891,629.86|1 to 2 year|Purchase payable|
||20,185.43|Over 3 years|Purchase payable|
|Wuxi Taitong Data Communication Co., Ltd.|33,750.00|Within 1 year|Purchase payable|
||12,150,000.00|1 to 2 year|Purchase payable|
|Total|131,882,041.83|——|——|

(4)Balance of accounts payable in foreign currency
||||||||
|-|-|-|-|-|-|-|
|Foreign Currency|As of 30 June 2014|||As of 31 December 2013|||
||Original currency|Exchange rate|RMB|Original currency|Exchange rate|RMB|
|HKD|3,567,154.79|0.79375|2,831,429.11|7,355,082.65|0.7862|5,782,786.63|
|Total|3,567,154.79|0.79375|2,831,429.11|7,355,082.65|0.7862|5,782,786.63|

18. Advances from customers
(1)Analysis of aging
||||
|-|-|-|
|Item|As of 30 June 2014|As of 31 December 2013|
|Within 1 year|36,317,290.64|58,142,480.12|
|1-2 years|14,745,598.55|5,957,445.42|

||||
|-|-|-|
|2-3 years|4,909,359.07|10,313,120.74|
|over 3 years|13,452,659.51|3,246,406.24|
|Total|69,424,907.77|77,659,452.52|

 (2) Accounts received in advance from shareholders holding5% or above voting shares of the company, as well as that of related parties.
||||
|-|-|-|
|Item|As of 30 June 2014|As of 31 December 2013|
|China Potevio Information Industry Co., Ltd.|8,163,434.00|8,163,434.00|
|China Putian Information Industry Group Co.,|22,990.00|22,990.00|
|Total|8,186,424.00|8,186,424.00|

 (3) Large advances from customers aged over one year
None.
19. Accrued payroll
||||||
|-|-|-|-|-|
|Item|As of 31 December 2013|Increase during the period|Decrease during the period|As of 30 June 2014|
|Wages, bonuses and|||||
||5,175,640.30|61,696,467.01|62,362,667.01|4,509,440.30|
|allowance|||||
|Welfare expense||7,190,858.22|6,895,813.41|295,044.81|
|Social insurance|||||
|||35,245,736.18|35,245,736.18||
|charges|||||
|Including: Medical|||||
|||16,496,411.56|16,496,411.56||
|insurance|||||
|Supplementary|||||
|||5,003,952.60|5,003,952.60||
|medical insurance|||||
|Basic endowment|||||
|||11,492,458.96|11,492,458.96||
|insurance|||||
|Unemployment|||||
|||980,191.19|980,191.19||
|insurance|||||
|Work injury|||||
|||253,677.18|253,677.18||
|insurance|||||
|Maternity insurance||400,129.18|400,129.18||
|Annuity||618,915.51|618,915.51||
|Housing fund|6,194,486.88|4,606,025.20|4,606,025.20|6,194,486.88|
|Compensation for|||||
|||53,444.70|53,444.70||
|cancellation of|||||

||||||
|-|-|-|-|-|
|labor relationship|||||
|Others|5,293,999.93|3,078,324.61|2,830,321.06|5,542,003.48|
|Including: labor|||||
||1,845,088.07|1,300,741.55|831,250.52|2,314,579.10|
|union expenditure|||||
|Employee education|||||
||3,448,911.86|1,525,026.05|1,746,513.53|3,227,424.38|
|expenses|||||
|Others||252,557.01|252,557.01||
|Total|16,664,127.11|111,870,855.92|111,994,007.56|16,540,975.47|

 Notes: Unpaid wages do not exist; closing payroll of RMB4,509,440.30 Yuan should be paid to the employee of not paying payroll.
20. Taxes payable
||||
|-|-|-|
|Item|As of 30 June 2014|As of 31 December 2013|
|Value-added tax|-7,744,730.58|-4,379,153.01|
|Business tax|0.11|103,424.74|
|Corporate income tax|2,117,369.63|4,363,611.90|
|Individual Income Tax|156,650.78|343,924.10|
|Urban maintenance and construction tax|192,608.16|647,480.53|
|Stamp Tax|11,815.79|4,496.30|
|Education surcharge|112,902.64|460,825.34|
|Land use tax|14,503.13||
|Property tax|19,343.84||
|Total|-5,119,536.50|1,544,609.90|

 21. Dividends payable
|||||
|-|-|-|-|
|Name|As of 30 June 2014|As of 31 December 2013|超过一年未支付原因|
|Jiangsu Huabang Mechanical and||||
||253,832.01|253,832.01||
|electrical equipment engineering Co., Ltd||||
|Ningbo Yinzhou New Star Plastic||||
||253,832.01|253,832.01||
|Electronic Co., Ltd||||
|Yuyao Guochang Electronic Co., Ltd|423,053.34|423,053.34||
|Nanjing Yongxin Electrical Appliance||||
||253,832.01|253,832.01||
|Matching Co., Ltd.||||
|Jingjiang Huasheng Communication||||
||84,610.67|84,610.67||
|Equipment Co., Ltd.||||
|Jiangdu Yate Communications Plastic|423,053.34|423,053.34||

|||||
|-|-|-|-|
|Products Co,. Ltd (Jiangdu Branch)||||
|Zhenjiang Shengtang Photoelectric||||
||253,832.01|253,832.01||
|Device Co,. Ltd||||
|Total|1,946,045.39|1,946,045.39|--|

22. Other payables
(1)Analysis of aging
||||
|-|-|-|
|Item|As of 30 June 2014|As of 31 December 2013|
|Within 1 year|36,248,723.55|43,924,558.52|
|1-2 years|14,959,256.91|1,494,666.54|
|2-3 years|1,251,390.50|1,165,895.45|
|over 3 years|6,760,537.39|5,663,905.42|
|Total|59,219,908.35|52,249,025.93|

 (2) Other payables to shareholders holding5% or above voting shares of the company, as well as that of related parties.
None.
(3) Aged over one year of significant other payables
None.
(4) A large amount of other payables
None.
23. Share capital
|||||||||
|-|-|-|-|-|-|-|-|
|||Increases(+) or decreases(-) in current year||||||
||As of 31|||Shares|||As of 30 June|
|||Issuance of new||||||
||December 2013||Gift share|transferred from|Others|Subtotal|2014|
|||shares||||||
|||||capital reserve||||
|Total number of|215,000,000.00||||||215,000,000.00|
|shares||||||||

24. Capital reserve
||||||
|-|-|-|-|-|
|Item|As of 31 December 2013|Increase during the year|Decrease during the year|As of 30 June 2014|
|Share capital premium|139,592,332.04|||139,592,332.04|

||||
|-|-|-|
|Other capital reserves|45,782,201.81|45,782,201.81|
|Total|185,374,533.85|185,374,533.85|

 25. Surplus reserve
||||||
|-|-|-|-|-|
||||Decrease during the||
|Item|As of 31 December 2013|Increase during the year||As of 30 June 2014|
||||year||
|Statutory surplus reserves|589,559.77|||589,559.77|
|Total|589,559.77|||589,559.77|

 26. Undistributed profit
||||
|-|-|-|
|||Proportion of Extraction or|
|Item|Amount||
|||Distribution|
|Undistributed profit at the end of last year before|||
||-14,489,140.50|--|
|adjustments|||
|Undistributed profit at the beginning of a year after|-14,489,140.50||
|||--|
|adjustment|||
|Add: Net profit attributable to the owner of the parent|||
||-9,418,674.05|--|
|company this year|||
|Undistributed profit at the ending of period|-23,907,814.55|--|

27. Operating revenues and costs
(1)Operating revenues
||||
|-|-|-|
|Item|Jan. to Jun. 2014|Jan. to Jun. 2013|
|Main operating revenue|1,155,060,034.97|1,200,190,368.34|
|Other operating revenue|17,963,615.28|7,367,170.48|
|Total|1,008,242,535.79|1,043,008,171.55|

 (2)Operating costs
||||
|-|-|-|
|Item|Jan. to Jun. 2014|Jan. to Jun. 2013|
|Main operating cost|987,142,781.80|1,038,297,903.22|
|Other operating cost|21,099,753.99|4,710,268.33|
|Total|1,008,242,535.79|1,043,008,171.55|

(3)Main Business (In terms of different products)
||||||
|-|-|-|-|-|
||Jan. to Jun. 2014||Jan. to Jun. 2013||
|Name of industry|||||
||Main operating revenue|Main operating cost|Main operating revenue|Main operating cost|
|Communication products|1,098,650,345.23|944,390,783.41|1,149,500,752.80|1,000,433,034.29|
|Electrical products|56,409,689.74|42,751,998.39|50,689,615.54|37,864,868.93|
|Total|1,155,060,034.97|987,142,781.80|1,200,190,368.34|1,038,297,903.22|

 (4) Main business items listed by Industry
||||||
|-|-|-|-|-|
||Jan. to Jun. 2014||Jan. to Jun. 2013||
|Name of product|||||
||Main operating revenue|Main operating cost|Main operating revenue|Main operating cost|
|Communications Equipment|1,098,650,345.23|944,390,783.41|1,149,500,752.80|1,000,433,034.29|
|Electrical industry|56,409,689.74|42,751,998.39|50,689,615.54|37,864,868.93|
|Total|1,155,060,034.97|987,142,781.80|1,200,190,368.34|1,038,297,903.22|

 (5) Main Business (In terms of different regions)
||||||
|-|-|-|-|-|
||Jan. to Jun. 2014||Jan. to Jun. 2013||
|Name of Region|||||
||Main operating revenue|Main operating cost|Main operating revenue|Main operating cost|
|Domestic market|1,133,705,754.02|966,504,571.87|1,189,316,018.09|1,027,739,558.96|
|Oversea market|21,354,280.95|20,638,209.93|10,874,350.25|10,558,344.26|
|Total|1,155,060,034.97|987,142,781.80|1,200,190,368.34|1,038,297,903.22|

 (6)The amount of operating revenues received from the top 5 customers this year
||||
|-|-|-|
|Item|Operating revenues|Proportion taking in total operating income of the Company (%)|
|China Telecom Co., Ltd and|||
||380,721,946.56|32.46%|
|Subordinate Enterprises|||
|China Mobile Co., Ltd and Subordinate|||
||123,253,414.28|10.51%|
|Enterprises|||
|China United Co., Ltd and Subordinate|||
||58,373,903.22|4.98%|
|Enterprises|||
|Beijing True Vision Technology Co.,|||
||38,870,270.94|3.31%|
|Ltd.|||
|Xi'an Huilong Technology Co., Ltd.|36,881,844.44|3.14%|
|Total|638,101,379.44|54.40%|

 28. Sales tax and extra charges
|||||
|-|-|-|-|
|Item|Jan. to Jun. 2014|Jan. to Jun. 2013|Rate|

|||||
|-|-|-|-|
|Business tax|216,902.57|460,965.09|3%、5%|
|Education surcharge|1,683,088.56|2,565,200.19|7%|
|Urban maintenance and construction tax|1,208,055.99|1,668,410.39|3%、2%|
|Others|1,225.15|||
|Total|3,109,272.27|4,694,575.67|--|

29. Sales expenses
||||
|-|-|-|
|Items|Jan. to Jun. 2014|Jan. to Jun. 2013|
|Salary|23,815,187.48|22,286,765.42|
|Employee benefits|2,421,523.53|1,880,925.49|
|Housing accumulation funds|1,694,214.24|1,261,947.34|
|Union funds|340,517.02|238,137.23|
|Worker education funds|355,467.33|304,153.84|
|Social insurance premium|5,595,745.31|3,926,171.42|
|Depreciation expense|518,735.76|438,796.55|
|Lease expense|359,522.52|153,155.50|
|Office allowance|8,169,483.64|6,844,885.69|
|Travel expenses|10,885,943.69|9,254,061.36|
|Business entertainment|11,817,721.08|14,427,339.98|
|Water and electricity fees|71,756.18|402,659.48|
|Low-valued consumables and amortize|80,710.26|92,747.81|
|Transport fees and transport damages|7,570,739.93|10,053,206.72|
|Repair charge|232,748.65|149,818.82|
|Service charge|1,804,523.70|1,892,650.70|
|Advertising fees|418,754.99|372,783.11|
|Exhibition fees||57,500.00|
|Conference expenses|1,712,295.64|2,219,895.40|
|Sales service charge|1,496,427.73|1,138,934.81|
|Business publicity fees|979,838.22|487,840.68|
|Technical services charge|379,825.95|131,166.00|
|Consulting, intermediary, legal fees|362,031.78|186,697.56|
|Labor protection fees|44,754.00|339,015.04|
|Postage telephone and telegram fees|334,598.05|65,165.57|

||||
|-|-|-|
|Co-ordination fee||1,284,522.65|
|Packing expenses|72,417.34|106,261.34|
|Insurance premium|3,300.00|746,023.16|
|Cost of quality||7,014.89|
|Power expenditures|10,816.03||
|Equipment maintain fees|1,431,989.41|949,474.00|
|Test fee|137,707.53|176,414.14|
|Others|1,515,171.00|397,417.21|
|Total|84,634,467.99|82,273,548.91|

 30. Administrative expenses
||||
|-|-|-|
|Items|Jan. to Jun. 2014|Jan. to Jun. 2013|
|Salary expenses|13,123,827.18|8,876,366.36|
|Employee benefits|2,420,279.38|1,915,788.35|
|Housing Fund|1,678,084.30|1,253,989.20|
|Union funds|337,480.13|251,001.70|
|Worker education funds|347,209.33|289,483.95|
|Social insurance premium|4,097,332.44|3,891,379.62|
|Depreciation expense|1,495,673.96|1,524,595.94|
|Amortization charge|507,601.26|300,390.80|
|Lease expense|3,817,176.87|3,612,956.35|
|Office allowance|2,135,508.47|1,661,645.73|
|Travelling expense|1,704,246.73|1,667,981.55|
|Business entertainment|1,443,464.96|1,597,446.05|
|Insurance Expense|118,308.06|458,613.09|
|Water and electricity fees|713,296.17|499,345.22|
|Low-valued consumables and amortization|74,051.18|110,881.59|
|Technology development costs|24,184,207.17|29,618,867.19|
|Repair charge|278,615.14|461,578.12|
|Audit expenses|572,981.21|164,070.38|
|Labor protection fees|32,595.12|186,331.05|
|Postage telephone and telegram fees||25,714.10|
|Director membership dues|172,717.95|166,923.08|

||||
|-|-|-|
|Consulting, intermediary, legal fees|1,175,989.22|711,985.28|
|Environmental expenditure|51,500.00|31,300.00|
|Taxation|802,643.24|945,903.57|
|Conference expenses|429,589.81|551,019.09|
|Taxation|81,709.07||
|Conference expenses|700,630.80|758,993.80|
|Taxation|878,456.91|508,925.35|
|Conference expenses|149,162.15|41,136.99|
|Advertising fees|85,797.22|311,192.76|
|Site use fee||115,845.13|
|Others|684,392.56|317,680.48|
|Total|64,294,527.99|62,829,331.87|

 31. Financial expenses
||||
|-|-|-|
|Item|Jan. to Jun. 2014|Jan. to Jun. 2013|
|Interest expense|17,583,995.66|13,618,333.70|
|Less: Interest income|1,829,898.72|2,139,988.73|
|Exchange loss|59,150.36|62,968.20|
|Less: Exchange gain|35.08|191,643.55|
|Bank charges|108,289.53|138,256.78|
|Others|735.80|105.24|
|Total|15,922,237.55|11,488,031.64|

 32. Investment income
(1) Details of Investment Income
||||
|-|-|-|
|Item|Jan. to Jun. 2014|Jan. to Jun. 2013|
|Long-term equity investment income by cost method||84,149.16|
|Long-term equity investment income by equity method|227,042.96|-1,967,352.65|
|Total|227,042.96|-1,883,203.49|

 (2) Long-term equity investment income by cost method
|||||
|-|-|-|-|
|Investee|Jan. to Jun. 2014|Jan. to Jun. 2013|Reasons for movement|
|Nanjing Putian Telecommunications Co.,||||
|||84,149.16|Assigned dividend|
|Ltd.||||
|Total||84,149.16|--|

(3)Long-term equity investment income by equity method
|||||
|-|-|-|-|
|Investee|Jan. to Jun. 2014|Jan. to Jun. 2013|Reasons for movement|
|Nanjing Prachanda Live Optical Network|||Business fluctuations|
||-989,488.38|-2,559,926.08||
|Co., Ltd||||
|Nanjing Putian Datang Information and|||Business fluctuations|
||886,085.16|477,145.68||
|Electric Co., Ltd.||||
|Nanjing Putian Zhongyou|||Business fluctuations|
|Telecommunication Co., Ltd.||||
|Putian Hi-tech Industry Co., Ltd.|260,515.55|220,448.93|Business fluctuations|
|Nanjing Putian Telege Cable Co., Ltd.|69,930.63|-105,021.18|Business fluctuations|
|Total|227,042.96|-1,967,352.65|--|

(4) Explain of investment income
During the reporting period, no significant repatriation of investment income restrictions
33. Losses of devaluation of asset
||||
|-|-|-|
|Item|Jan. to Jun. 2014|Jan. to Jun. 2013|
|Loss on bad debt|1,197,912.02|591,682.86|
|Total|1,197,912.02|591,682.86|

 34. Non-operating income
(1) Details of Non-operating Income
|||||
|-|-|-|-|
||||Non-recurring gains and losses|
|Item|Jan. to Jun. 2014|Jan. to Jun. 2013|recognized in the income|
||||amount|
|Gains from disposal of non-current assets|1,220.16|36,352.80|1,220.16|
|Include: Gains from disposal of fixed assets|1,220.16|36,352.80|1,220.16|
|Government grants|1,458,478.28|1,793,770.76|1,458,478.28|
|Others|3,288,764.41|97,544.00|3,288,764.41|
|Total|4,748,462.85|1,927,667.56|4,748,462.85|

 (2) Details of Government Subsidy
||||||
|-|-|-|-|-|
||||Relating to assets /|Non-recurring gains and|
|Grant project|Jan. to Jun. 2014|Jan. to Jun. 2013|||
||||income-related|losses|
|Refund of VAT|1,444,902.28|1,391,604.16|Income-related|Yes|

||||||
|-|-|-|-|-|
|Enterprise Incentive||||Yes|
||13,576.0|0|Income-related||
|payments|||||
|Subsidy income||402,166.60|Income-related|Yes|
|Total|1,458,478.2|8 1,793,770.76|--|--|

35. Non-operating expense
|||||
|-|-|-|-|
||||Non-recurring gains and|
|Item|Jan. to Jun. 2014|Jan. to Jun. 2013|losses recognized in the|
||||income amount|
|Loss from disposal of non-current assets|105,658.79||105,658.79|
|Include: loss from disposal of fixed assets|105,658.79||105,658.79|
|Loss from debt restructuring||30,865.75||
|External donation||1,000.00||
|Abnormal expenses|75,000.00||75,000.00|
|Others|232,414.94|568,250.10|232,414.94|
|Total|413,073.73|600,115.85|413,073.73|

 36. Income tax
||||
|-|-|-|
|Item|Jan. to Jun. 2014|Jan. to Jun. 2013|
|Current income tax expense calculated to tax law and relevant|||
||5,248,812.79|3,597,267.56|
|provisions|||
|Total|5,248,812.79|3,597,267.56|

 37. Calculation of basic earnings per share and diluted earnings per share
Calculation of basic earnings per share and diluted earnings per share
|||||
|-|-|-|-|
|Item|Code|Jan. to Jun. 2014|Jan. to Jun. 2013|
|Net profit attributable to ordinary shareholders of parent company(Ⅰ)|P0|-9,418,674.05|-2,719,217.34|
|Net profit attributable to the company's ordinary shareholders afterdeducting non-recurring gains and losses(Ⅱ)|P0|-13,163,451.04|-3,466,018.77|
|Amount of common stock at the year-beginning|S0|215,000,000.00|215,000,000.00|
|Increase of amount of common stock owing to capital reserve transferred to sharecapital or distribution of stock dividend|S1|||
|Increase of amount of common stock owing to issue of bonds newly or bonds issuedto be transfer to common stock|Si|||

|||||
|-|-|-|-|
|Decrease of amount of common stock due to purchase-back common stock ,etc|Sj|||
|Decrease of amount of common stock in the reporting period|Sk|||
|Amount of months in the reporting period|M0|6|6|
|Accumulated months since the second month when increase of amount of commonstock|Mi|||
|Accumulated months since the second month when decrease of amount of commonstock|Mj|||
|Average weighted amount of common stock outstanding|S|215,000,000.00|215,000,000.00|
|Basic earnings per share(Ⅰ)||-0.0438|-0.013|
|Basic earnings per share(Ⅱ)||-0.0612|-0.016|
|Net profit attributable to ordinary shareholders of parent company afteradjustment(Ⅰ)|P1|-9,418,674.05|-2,719,217.34|
|Net profit attributable to the company's ordinary shareholders afterdeducting non-recurring gains and losses after adjustment(Ⅱ)|P1|-13,163,451.04|-3,466,018.77|
|Increase amount of average weighted of common stock owing to realization ofwarrants, stock options and convertible bonds||||
|Average weighted amount of common stock outstanding after consideration of dilutedaffect||215,000,000.00|215,000,000.00|
|Diluted earnings per share(Ⅰ)||-0.0438|-0.013|
|Diluted earnings per share(Ⅱ)||-0.0612|-0.016|

 (1)Basic earnings per share
Basic earnings per share=P0÷ S
S=S0＋S1＋Si×Mi÷M0–Sj×Mj÷M0-Sk
Where;P0 means net profit attributable to ordinary shareholders of parent company or net profit attributable to the company's ordinary shareholders after deducting non-recurring gains and losses; S means average weighted amount of common stock outstanding; S0 means amount of common stock at the year-beginning; S1 means increase of amount of common stock owing to capital reserve transferred to share capital or distribution of stock dividend; Si means increase of amount of common stock owing to issue of bonds newly or bonds issued to be transfer to common stock; Sj means decrease of amount of common stock due to purchase-back common stock ,etc; Sk means decrease of amount of common stock in the reporting period; M0 means amount of months in the reporting period; Mi means accumulated months since the second month when increase of amount of common stock; Mj means accumulated months since the second month when decrease of amount of common stock;
(2)Diluted earnings per share
Diluted earnings pershare=P1/(S0＋S1＋Si×Mi÷M0–Sj×Mj÷M0–Sk+ Increase amount of average weighted of common stock owing to realization of warrants, stock options and convertible bonds.
Where: P1 means net profit attributable to ordinary shareholders of parent company or net profit attributable to the company's ordinary
shareholders after deducting non-recurring gains and losses after adjustment in consideration of the effect of dilutive potential ordinary share,
regulated by accounting criteria for enterprises in china or other related regulations. When calculation of diluted earnings per share, all effects of
Net profit attributable to the company's ordinary shareholders after deducting non-recurring gains and losses after adjustment and average weighted amount of common stock outstanding, associated with dilutive potential ordinary share, calculating of diluted earnings per share to the degree that is minimum of EPS, according to their degree of descending order of diluted earnings per share referred.
38. Other comprehensive income
||||
|-|-|-|
|Item|Jan. to Jun. 2014|Jan. to Jun. 2013|
|4. Foreign currency translation differences of financial statements|-153,920.61|293,104.46|
|Subtotal|-153,920.61|293,104.46|
|Total|-153,920.61|293,104.46|

 39. Item description in the statement of cash flow
(1) Other cash receipts relating to operating activities
|||
|-|-|
|Item|Amount|
|Interest income|1,829,898.72|
|Temporary receipts and repayment of temporary payment|53,956,029.20|
|Others|755,771.18|
|Total|56,541,699.10|

 (2) Other cash payments relating to operating activities
|||
|-|-|
|Item|Amount|
|Temporary payment|14,262,612.34|
|Various expenses|89,377,474.09|
|Others|167,439.89|
|Total|103,807,526.32|

 40. Supplementary information about consolidated statement of cash flows
(1) Supplementary information about consolidated statement of cash flows
||||
|-|-|-|
|Item|Jan. to Jun. 2014|Jan. to Jun. 2013|
|1、Adjustment of net profit into operation activity cash flow:|--|--|
|Net profit|-5,063,684.07|-1,480,723.02|
|Add: Impairment of assets|1,197,912.02|591,682.86|
|Depreciation of fixed assets, consumption of oil gas assets and|||
||5,653,114.69|5,378,053.88|
|depreciation of productive biological assets|||

||||
|-|-|-|
|Amortization of intangible assets|1,057,210.80|722,546.81|
|Loss from disposal of fixed assets, intangible assets and other long|||
||104,438.63|-36,352.80|
|term assets (gain is listed with ―-‖)|||
|Financial expense (gain is listed with ―-‖)|15,749,377.69|13,618,333.70|
|Investment loss (gain is listed with ―-‖)|-227,042.96|1,883,203.49|
|Decrease of inventories (increase is listed with ―-‖)|-27,316,513.66|778,710.84|
|Decrease of operational accounts receivable (increase is listed|||
||-106,705,473.15|-153,427,525.04|
|with ―-‖)|||
|Increase of operational accounts payable (decrease is listed with|||
||59,035,877.22|-3,283,218.67|
|―-‖)|||
|Net cash flow arising from operation activities|-56,514,782.79|-135,255,287.95|
|2. Significant investment and financing activities with no|||
||--|--|
|reference to cash collection and payment:|||
|3. Net change in cash and cash equivalent:|--|--|
|Balance of cash at period-end|358,111,049.62|280,748,252.81|
|Less: Balance of cash at period-begin|402,037,725.25|429,693,529.41|
|Net increase in cash and cash equivalent|-43,926,675.63|-148,945,276.60|

 (2) Cash and cash equivalent
||||
|-|-|-|
|Item|As of 30 June 2014|As of 31 December 2013|
|Cash|358,111,049.62|402,037,725.25|
|Cash in hand|60,174.45|10,154.33|
|May at any time is used to pay the bank deposit|303,434,172.06|402,027,570.92|
|May at any time for the payment of the other monetary funds|54,616,703.11||
|Cash and cash equivalent at the year end|358,111,049.62|402,037,725.25|

 VIII .Related parties and related transaction
1. Condition of parent company
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
||||||||Rate of|The|||
||||||||Share Held|proportion|||
||||||||||The||
||||||||between|of voting|||
|Name of the|||||||||company's||
|||Type of|Registered|Legal|Business|Registration|Parent|rights||Organization|
|parent|Relation||||||||Ultimate||
|||entity|Address|representative|nature|capital|Company|between||code|
|company|||||||||controlling||
||||||||and the|parent|||
||||||||||party||
||||||||Company|company|||
||||||||(%)|and the|||

||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
|||||||||company|||
|||||||||(%)|||
||||No. 2 Tudi 2||||||||
||||Road,||||||||
|China|||Zhongguan||||||China||
|Potevio|||village||||||Putian||
||Parent||||Information||||||
|Information||State-owned|economy|Xing Wei||1903050000|53.49%|53.49%|Information|71093155-5|
||Company||||industry||||||
|Industry|||zone,||||||Industry||
|Co., Ltd.|||Haidian||||||Group Co.||
||||district,||||||||
||||Beijing||||||||

2. Condition of subsidiaries
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
|||||||||The||
||||||||Rate of|proportio||
||||||||Share|n of||
||||||||held|voting||
|||||||Registratio||||
||Type of|||Legal|||between|rights||
|Name of the||Type of|Registere|||n Capital|||Organizatio|
||subsidiarie|||Representativ|Business Nature||parent|between||
|companies||Entity|d Address|||(unit: Wan|||n code|
||s|||e|||company|parent||
|||||||Yuan)||||
||||||||and the|company||
||||||||Compan|and the||
||||||||y (%)|company||
|||||||||(%)||
|Nanjing Southern|||||Sales|||||
||Limited|||||||||
|Telecommunication||Trading|Nanjing|Hong Wang|telecommunication|3,420.50|98.24|98.24|13492047-8|
||company|||||||||
|s Company Limited|||||products|||||
|Nanjing Bada|||||Manufacture of|||||
||Limited|Manufactur||||||||
|Telecommunication|||Nanjing|Jin Qiao|telecommunication|1,130.14|60.00|60.00|13554048-5|
||company|e||||||||
|s Co., Ltd.|||||s|||||
|Nanjing Putian|||||Manufacture and|||||
|Information|Limited|Manufactur|||sale of|||||
||||Nanjing|Yong Shu Lu||1,400.00|99.98|99.98|13498233-7|
|Technology|company|e|||telecommunication|||||
|Company Ltd.|||||s|||||
||||||Manufacture and|||||
|Nanjing Putian||||||||||
||Limited|Manufactur|||sale of|||||
|Telege Intelligent|||Nanjing|Baosun Fu||1,200.00|45.77|45.77|72172045-4|
||company|e|||telecommunication|||||
|Building Ltd||||||||||
||||||s|||||
|Putian|company|Manufactur|||Sale of|||||
||||HongKong|Liang Sun||HK 200.00|90.00|90.00|#61770414|
|Telecommunication|limited by|e|||telecommunication|||||

|||||||||||
|-|-|-|-|-|-|-|-|-|-|
|s (Hong Kong) Co.,|shares||||s|||||
|Ltd.||||||||||
||||||Web-based|||||
|Beijing Picom||||||||||
||Limited|Manufactur|||electronic products,|||||
|Telecommunication|||Beijing|Junhai Lu||USD 50.00|51.00|51.00|717741092|
||company|e|||digital transmission|||||
|s Equipment Ltd.||||||||||
||||||equipment|||||
|Nanjing Putian|||||Manufacture and|||||
|WongShi|Limited|Manufactur|||sale of|USD||||
||||Nanjing|Qiang Sun|||99.42|99.42|71093784-2|
|Telecommunication|company|e|||telecommunication|1,090.00||||
|s Co., Ltd.|||||s|||||
|Nanjing Putian||||||||||
||||||Manufacture and|||||
|Changle||||||||||
||Limited|Manufactur|||sale of|||||
|Telecommunication|||Nanjing|Qiang Wang||1,000.00|50.70|50.70|13554526-X|
||company|e|||telecommunication|||||
|s Equipment Co.,||||||||||
||||||s|||||
|Ltd||||||||||
||||||Manufacture and|||||
|Nanjing Putian||||||||||
||Limited|Manufactur|||sale of|||||
|Network Company|||Nanjing|Yingqian Guan||1,000.00|78.00|78.00|74236858-4|
||company|e|||telecommunication|||||
|Ltd.||||||||||
||||||s|||||
||||||Manufacture and|||||
|Nanjing Putian||||||||||
||Limited|Manufactur|||sale of|||||
|Telecommunication|||Nanjing|Chuanxi Liu||475.00|70.00|70.00|13513422-5|
||company|e|||telecommunication|||||
|Technology Co., Ltd||||||||||
||||||s|||||
|Nanjing Mennekes|||||Product and sales|||||
||Limited|Manufactur||||||||
|Electric Appliances|||Nanjing|Hong Wang|socket for industrial|USD 520.00|75.00|75.00|60895120-X|
||company|e||||||||
|Ltd.|||||use|||||
||||||Production and|||||
|Nanjing Putian||||||||||
||Limited|Manufactur|||marketing of|||||
|Datang Information|||Nanjing|Yaoming Yan||1,000.00|40.00|40.00|777019050|
||company|e|||electronic products,|||||
|Electronics Co., Ltd.||||||||||
||||||etc.|||||

3. Condition of the joint ventures and associates
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
||||Legal person||||Voting|||
||||||Registration|Proportion of||Relationsh||
|||Place of||Business|||proportion in||Organization|
|Invested units|Types||||Capital (unit: Wan|s hareholding||ip with||
|||registration||nature|||invested||code|
||||||Yuan)|（%）||the company||
||||||||company (%)|||
|Joint venture||||||||||
|anjing Prachand|||ShenweicoZhango|Optical||||||
||aSino-foreign|||||||||
|ive Optica||Nanjing||mmunication|3 7,088,800.00|50|50|Joint venture|55553484-X|
||ljoint venture|||||||||
|etwork Co., Ltd||||f production||||||

|||||||||||
|-|-|-|-|-|-|-|-|-|-|
|Affiliated venture||||||||||
|anjing Putia|nD omestic||C|ommunicatio|n|||||
|hongyou|(limited|||products||||Affiliated||
|||Nanjing|ZhaoTiwu||1,000,000.00|30|30||249702200|
|elecommunicatio|nl iability|||production||||venture||
|o., Ltd.|company)|||sales, etc||||||
||Domestic|||Industrial park||||||
|anjing Putia||||||||||
||n(limited|||venue rental||||Affiliated||
|igh Technolog||Nanjing K|ong ShanYou||337,548,141.29|49.64|49.64||667372881|
||yliability|||management||||venture||
|ndustry Co., Ltd.||||||||||
||company)）|||etc||||||

4. Other related parties
||||
|-|-|-|
||Relationship with||
|Company Name||Organization code|
||the company||
|Nanjing Putian Swanking Electrical Co., Ltd|Controlled by the parent company|724594270|
||Controlled by controlling shareholder of the||
|Shenzhen Putian Lingyun Electronics Co. Ltd||732050660|
||parent company||
|Shanghai Putian Post And Telecommunications|||
||Controlled by the parent company|607285751|
|Technology Co., Ltd.|||
|Beijing Great Gragon Information Technology|||
||Controlled by the parent company|743349502|
|International Co., Ltd.|||
|Chengdu Putian Telecommunications Cable|||
||Controlled by the parent company|20193968X|
|CO., LTD|||
|Putian Institute of Technology Co., Ltd.|Controlled by the parent company|710929105|

5. Related transaction
(1) Purchasing goods, accept services related party transactions
||||||||
|-|-|-|-|-|-|-|
||||Jan. to Jun. 2014||Jan. to Jun. 2013||
|||Pricing policy and||Ratio in||Ratio in|
||Related transaction||||||
|Related Parties||decision-making||similar||similar|
||content||Amount||Amount||
|||processes||trade||trade|
|||||amount %||amount %|
|Chengdu Putian|||||||
|Telecommunications|Telecommunications|Market Pricing|26,546,759.66|2.69%|3,080,417.95|0.31%|
|Cable CO., Ltd.|||||||
|Nanjing Prachanda|||||||
|Live Optical Network|Telecommunications|Market Pricing|10,965,345.57|1.11%|23,300,743.64|2.33%|
|Co., Ltd|||||||

||||||||
|-|-|-|-|-|-|-|
|China Potevio|||||||
|Information Industry|Telecommunications|Market Pricing|||11,021,914.53|1.10%|
|Co., Ltd.|||||||
|Total|||37,512,105.23|3.80%|37,403,076.12|3.74%|

 (2) The sale of goods, providing labor services related transaction
||||||||
|-|-|-|-|-|-|-|
||||Jan. to Jun. 2014||Jan. to Jun. 2013||
|||Pricing policy and||Ratio in||Ratio in|
||Related transaction||||||
|Related Parties||decision-making||similar||similar|
||content||Amount||Amount||
|||processes||trade||trade|
|||||amount %||amount %|
|China Potevio|||||||
|Information Industry|Telecommunications|Market Pricing|21,328,788.21|1.82%|66,840,783.74|5.82%|
|Co., Ltd.|||||||
|Nanjing Putian|||||||
|Zhongyou|||||||
||Telecommunications|Market Pricing|61,920.00|0.01%|107,692.31|0.01%|
|Telecommunication|||||||
|Co., Ltd.|||||||
|Nanjing Prachanda|||||||
|Live Optical Network|Telecommunications|Market Pricing|5,494.00||12,129.05||
|Co., Ltd|||||||
|Putian Technology|||||||
|Research Institute Co.,|Telecommunications|Market Pricing|||489,564.10|0.04%|
|Ltd.|||||||
|Nanjing Putian Datang|||||||
|Information and Electric|Telecommunications|Market Pricing|||2,431.63||
|Company Ltd.|||||||
|Total|||21,396,202.21|1.83%|67,452,600.83|5.87%|

 (3)Related leasing
||||||||
|-|-|-|-|-|-|-|
|||||||Rental revenue|
||||Date start for|Date for termination|Accordance for||
|Lessor|Lessee|Leased assets||||impact on the|
||||||reorganization of||
||||leasing|of leasing|||
||||||rental income||
|||||||company|
|Nanjing Putian High|Nanjing Putian||||||
|Technology Industry|t elecommunication|Land Property|2014-01-01|2014-12-31|Market Pricing|3,653,577.35|
|Co., Ltd.|Co., Ltd||||||

Associated lease note:
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
|Lessor|Lessee|Leasedasset|Value of theleased asset|Date start for|Date fo|r Rental fee|Property costs|Accordancefor|Rental revenueimpact on the|

|||||||||||
|-|-|-|-|-|-|-|-|-|-|
|||position||leasing to|erminationf leasing|||reorganizationof rentalincome|company|
|NanjingPutian HighTechnologyIndustryCo., Ltd.|Nanjing PutiantelecommunicationCo., Ltd|good|36,241,036.82|2014-01-01|2014-12-31|3,653,577.35|851,970.83|MarketPricing|4,505,548.18|

(4)Related guarantee
|||||||
|-|-|-|-|-|-|
|Assurance|||Date start for||Whether the guarantee|
||Secured party|Amount of guarantee||Due date for guarantee||
|Provider|||guarantee||is carried out|
|Nanjing Putian|Nanjing Southern|||||
|telecommunication Co.,|Telecommunications|20,000,000.00|2013-11-25|2014-11-24|No|
|Ltd.|Company Ltd.|||||
|Nanjing Putian|Nanjing Southern|||||
|telecommunication Co.,|Telecommunications|10,000,000.00|2013-08-30|2014-08-29|No|
|Ltd.|Company Ltd.|||||
|Nanjing Putian|Nanjing Southern|||||
|telecommunication Co.,|Telecommunications|10,000,000.00|2013-09-28|2014-09-27|No|
|Ltd.|Company Ltd.|||||
|Nanjing Putian|Nanjing Southern|||||
|telecommunication Co.,|Telecommunications|20,000,000.00|2014-01-13|2014-12-31|No|
|Ltd.|Company Ltd..|||||
|Nanjing Putian||||||
||Nanjing Putian Telege|||||
|telecommunication Co.,||10,000,000.00|2013-10-10|2014-10-09|No|
||Intelligent Building Ltd|||||
|Ltd.||||||
|Nanjing Putian||||||
||Nanjing Putian Telege|||||
|telecommunication Co.,||10,000,000.00|2013-09-23|2014-09-22|No|
||Intelligent Building Ltd|||||
|Ltd.||||||
|Nanjing Putian|Nanjing Prachanda|||||
|telecommunication Co.,|Live Optical Network|5,000,000.00|2013-09-02|2014-08-14|No|
|Ltd.|Co., Ltd.|||||
|Nanjing Putian|Nanjing Prachanda|||||
|telecommunication Co.,|Live Optical Network|4,000,000.00|2013-10-23|2014-07-21|No|
|Ltd.|Co., Ltd.|||||
|Nanjing Putian|Nanjing Prachanda|||||
|telecommunication Co.,|Live Optical Network|1,020,000.00|2014-01-22|2014-07-22|No|
|Ltd.|Co., Ltd.|||||
|China Potevio|Nanjing Putian|20,000,000.00|2014-01-14|2015-01-14|No|

|||||||
|-|-|-|-|-|-|
|Information Industry|telecommunication Co.,|||||
|Co., Ltd.|Ltd.|||||
|China Potevio|Nanjing Putian|||||
|Information Industry|telecommunication Co.,|30,000,000.00|2013-12-10|2014-12-09|No|
|Co., Ltd.|Ltd.|||||
|China Potevio|Nanjing Putian|||||
|Information Industry|telecommunication Co.,|20,000,000.00|2013-12-06|2014-12-05|No|
|Co., Ltd.|Ltd.|||||
|China Potevio|Nanjing Putian|||||
|Information Industry|telecommunication Co.,|44,000,000.00|2014-05-05|2015-05-05|No|
|Co., Ltd.|Ltd.|||||
|China Potevio|Nanjing Putian|||||
|Information Industry|telecommunication Co.,|30,000,000.00|2014-06-05|2015-06-05|No|
|Co., Ltd.|Ltd.|||||
|China Potevio|Nanjing Putian|||||
|Information Industry|telecommunication Co.,|160,000,000.00|2013-08-21|2014-08-20|No|
|Co., Ltd.|Ltd.|||||
|China Potevio|Nanjing Putian|||||
|Information Industry|telecommunication Co.,|20,000,000.00|2013-09-01|2014-08-31|No|
|Co., Ltd.|Ltd.|||||

6. Payables and receivables of related parties
(1) Receivables from related parties
|||||||
|-|-|-|-|-|-|
||Name of the related|As of 30 June 2014||As of 31 December 2013||
|Item||||||
||parties|Book amount|Provision|Book amount|Provision|
||Nanjing Putian|||||
||Zhongyou|||||
|Accounts receivable||||384,272.80||
||Telecommunication Co.,|||||
||Ltd.|||||
||China Potevio|||||
|Accounts receivable|Information Industry Co.,|23,171,706.49|100,904.72|24,187,722.30|2,936.37|
||Ltd.|||||
||Putian Technology|||||
|Accounts receivable|Research Institute Co.,|80,784.00||80,784.00||
||Ltd.|||||
||Shanghai Putian|||||
|Accounts receivable||803,719.70|8,420.00|973,829.70||
||Network Company Ltd.|||||
||Shanghai Putian|||||
|Accounts receivable||13,341,700.00||13,341,700.00||
||Youtong Technology|||||

|||||||
|-|-|-|-|-|-|
||Co., Ltd.|||||
||China Potevio|||||
|Other receivables|Information Industry Co.,|360,680.00||17,500.00||
||Ltd.|||||
||Beijing Picom|||||
|Other receivables|Telecommunications|28,912,122.71|28,912,122.71|28,912,122.71|28,912,122.71|
||Equipment Co., Ltd.|||||

(2) Payables to related parties
|||||
|-|-|-|-|
|Item|Name of the related parties|As of 30 June 2014|As of 31 December 2013|
||Nanjing Prachanda Live Optical|||
|Accounts payable||51,320,585.03|49,444,830.71|
||Network Co., Ltd.|||
||China Potevio Information|||
|Accounts payable||21,290,106.90|21,290,106.90|
||Industry Co., Ltd.|||
||China Potevio Information|||
|Receipts in advance||8,163,434.00|8,163,434.00|
||Industry Co., Ltd.|||
||China Putian Information Industry|||
|Receipts in advance||22,990.00|22,990.00|
||Group Co.,|||
||Nanjing Putian High Technology|||
|Other payables||1,443,989.64|974,661.69|
||Industry Co., Ltd.|||
||Chengdu Putian|||
|Accounts payable|Telecommunications Cable Co.,||514,074.00|
||Ltd.|||
||Nanjing Prachanda Live Optical|||
|Other payables||1,372,064.01|155,951.65|
||Network Co., Ltd.|||
||Nanjing Putian Datang|||
|Accounts payable|||118,628.05|
||information electronic Co., Ltd.|||
||Nanjing Putian High Technology|||
|Accounts payable||222,381.72|74,127.24|
||Industry Co., Ltd.|||
||Nanjing Putian Swanking|||
|Accounts payable|||2,002.01|
||Electrical Co., Ltd|||

IX．Contingencies
1. The pending litigation or arbitration formed a liability and its financial effect
None
2. Contingent liabilities formed by external guarantee and its financial effect
In addition the Company provides guarantees to related parties, the inaction of other non-related parties to provide security matters.
3. Other contingent liabilities
None
X. Commitments
1. Significant commitment matters
None
2. Early promise fulfillment situation
None
XI. Events occurring after the balance sheet date
1. Important matters after balance sheet date
None
2. Balance sheet date profit allocation illustrate
None
3. Other matters after balance sheet date
None
XII. Other significant matters
1. Financial assets and financial liabilities in foreign currency
|||||||
|-|-|-|-|-|-|
||||the cumulative|||
||As of 31 December|Current changes in||Current provision for||
|Items|||changes in fair value||As of 30 June 2014|
||2013|fair value||impairment||
||||included in equity|||
|Financial assets:||||||
|3. Loans and receivables|4,725,508.98||||4,770,705.93|
|Subtotal|4,725,508.98||||4,770,705.93|
|Financial liability|5,782,786.63||||3,567,154.79|

 XIII. Notes to main items of financial statement of parent company
1. Account receivable
(1)Classification of accounts receivable
||||
|-|-|-|
|Item|As of 30 June 2014|As of 31 December 2013|

||||||||||
|-|-|-|-|-|-|-|-|-|
||Book balance||Reserve for bad debts||Book balance||Reserve for bad debts||
|||Percentage||Percentage||Percentage||Percentage|
||Amount||Amount||Amount||Amount||
|||(%)||(%)||(%)||(%)|
|Classification as the group of provision for account receivable|||||||||
|Group1|182,075,050.74|30.64%|||130,443,704.30|26.39%|||
|Group 2|335,315,864.28|56.43%|||342,775,948.10|69.35%|||
|Group 3|75,007,211.76|12.62%|8,673,961.97|11.56%|19,225,197.21|3.89%|8,039,017.60|41.82%|
|Subtotal|592,398,126.78|99.69%|8,673,961.97|1.46%|492,444,849.61|99.63%|8,039,017.60|1.63%|
|Single amount not|||||||||
|significant but single|||||||||
||1,837,610.12|0.31%|1,837,610.12|100.00%|1,837,610.12|0.37%|1,837,610.12|100.00%|
|provision for accounts|||||||||
|receivable|||||||||
|Total|594,235,736.90|--|10,511,572.09|--|494,282,459.73|--|9,876,627.72|--|

Notes：Single amount dramatic and individual provision for accounts receivable refers to single exceed RMB 10,000,000.00 Yuan, test no impairment, the company according to age analysis accrual impairment provision. According to the group of receivables provision for more than 2 years of age receivables, via test no impairment, according to age analysis accrual impairment provision.
Adopt age analysis provision in group as follows:
||||||||
|-|-|-|-|-|-|-|
||As of 30 June 2014|||As of 31 December 2013|||
|Age|Book balance|||Book balance|||
||||Reserve for bad debts|||Reserve for bad debts|
||Amount|Percentage (%)||Amount|Percentage (%)||
|Within 1 year|||||||
|(contain 1|172,379,120.33|67.05%||109,836,962.71|73.39%||
|year)|||||||
|1 to 2 years|58,882,704.20|22.90%||24,222,714.86|16.18%||
|2 to 3 years|14,545,016.98|5.66%|1,454,501.69|4,854,306.48|3.24%|485,430.66|
|3 to 4 years|11,275,420.99|4.39%|7,219,460.28|10,754,917.46|7.19%|7,553,586.94|
|4 to 5 years|3,904,397.58|1.52%|1,171,319.29|2,150,016.08|1.44%|645,004.82|
|5 to 6 years|1,994,567.21|0.77%|797,826.91|1,800,024.19|1.20%|720,009.68|
|6 years or|||||||
||5,376,456.20|2.10%|5,250,314.08|6,804,877.19|4.55%|6,188,572.44|
|above|||||||
|Total|257,082,262.50|--|8,673,961.97|149,668,901.51|--|8,039,017.60|

 Closing single amount not significant but single provision for accounts receivable
||||||
|-|-|-|-|-|
|Receivables|Book amount|Bad debt|Proportion|Reason|
|China Unicom Nanjing||||Age longer cannot berecalled|
||12,500.0|0 12,500.00|100.00%||
|Branch|||||

||||||
|-|-|-|-|-|
|M/S WHISTLER TELECOM||||Age longer cannot be|
||1,724,928.12|1,724,928.12|100.00%||
|(PVT) LTD||||recalled|
|||||Age longer cannot be|
|PRADUFA|100,182.00|100,182.00|100.00%||
|||||recalled|
|Total|1,837,610.12|1,837,610.12|--|--|

(2) Current payback or return of receivables
During this year no full provision for bad prophase preparation, or larger proportion, but in this period fully recovery or payback, or recovery or payback larger proportion of account receivable.
(3) Written -off of accounts receivable in the current period
None
(4) Accounts receivable due from shareholder who has more than5% (including 5%) voting shares of the Company at year-end
||||||
|-|-|-|-|-|
||As of 30 June 2014||As of 31 December 2013||
|Name|||||
||Book balance|Reserve for bad debts|Book balance|Reserve for bad debts|
|China Potevio Information Industry|||||
||20,533,400.80|44,555.1|5 21,794,542.40|0.00|
|Co., Ltd.|||||
|Total|20,533,400.80|44,555.1|5 21,794,542.40|0.00|

 (5) Top 5 debtors of accounts receivable
||||||
|-|-|-|-|-|
||Relationship with the|||Proportion of total amount|
|Name of the debtors||Amount|Aging||
||Company|||(%)|
|China Telecom Co., Ltd.|||||
||Non-related party|108,903,821.32|Within 1 year|18.33%|
|Jiangsu Branch|||||
|Agricultural Bank of China|Non-related party|35,302,050.79|Within 2 year|5.94%|
|China Potevio Information|||||
||Parent company|20,553,400.80|Within 3 year|3.46%|
|Industry Co., Ltd.|||||
|China Telecom Co., Ltd.|||||
||Non-related party|16,968,052.69|Within 4 year|2.86%|
|Henan Branch|||||
|Shenzhen Qianzhiwei|||||
|Communication Technology|Non-related party|16,729,250.00|1 to 2 year|2.82%|
|Co., Ltd.|||||
|Total|--|198,456,575.60|--|33.41%|

 (6) Accounts receivable of related parties accounts
|||||
|-|-|-|-|
|Name of the debtors|Relationship with the Company|Amount|Proportion of total amount (%)|
|China Potevio Information|Parent company|20,553,400.80|3.46%|

|||||
|-|-|-|-|
|Industry Co., Ltd.||||
|Shanghai Putian Youtong|Controlled by the same parent|||
|||13,341,700.00|2.25%|
|Technology Co., Ltd.|company|||
|Shanghai Putian Network|Controlled by the same parent|||
|||803,719.70|0.13%|
|Company Ltd.|company|||
|Putian Technology Research|Controlled by the same parent|||
|||80,784.00|0.01%|
|Institute Co., Ltd.|company|||
|Total|--|34,779,604.50|5.85%|

 (7) Balance of accounts receivable in foreign currencies
||||||||
|-|-|-|-|-|-|-|
|Foreign currency|As of 30 June 2014|||As of 31 December 2013|||
||Original currency|Exchangerate|RMB converted|Original currency|Exchange rate|RMB converted|
|USD|308,556.56|6.1528|1,898,486.80||||
|Total|——|——|1,898,486.80||||

2. Other receivables
(1)Classification of other receivables
2. Other receivables
(1)Classification of other receivables
2. Other receivables
(1)Classification of other receivables
||||||||||
|-|-|-|-|-|-|-|-|-|
||As of 30 June 2014||||As of 31 December 2013||||
||Book balance||Reserve for bad debts||Book balance||Reserve for bad debts||
|Item|||||||||
|||Percentage||Percentage||ercentage||Percentage|
||Amount||Amount||PAmount||Amount||
|||(%)||(%)||(%)||(%)|
|Single amount dramatic and|||||||||
|individual provision for the|28,912,122.71|39.92%|28,912,122.71|100.00%|28,912,122.71|24.89%|28,912,122.71|100.00%|
|accounts receivable|||||||||
|Classification as the group of provision for account receivable|||||||||
|Group1|12,000,000.00|16.57%|4,800,000.00|40.00%|47,021,708.19|40.49%|6,400,000.00|13.61%|
|Group 2|15,682,024.17|21.66%|||27,119,206.47|23.35%|||
|Group 3|11,736,823.42|16.21%|5,053,916.81|43.06%|9,001,281.19|7.75%|4,077,828.68|45.30%|
|Subtotal|39,418,847.59|54.44%|9,853,916.81|25.00%|83,142,195.85|71.59%|10,477,828.68|12.60%|
|Single amount not significant|4,085,166.33|5.64%|4,085,166.33|100.00%|4,085,166.33|3.52%|4,085,166.33|100.00%|

||||||||||
|-|-|-|-|-|-|-|-|-|
|but single provision fo|r||||||||
|accounts receivable|||||||||
|Total|72,416,136.63|--|42,851,205.85|--|116,139,484.89|--|43,475,117.72|--|

Notes：Single amount dramatic and individual provision for other receivable refers to single exceed RMB 10,000,000.00 Yuan, test no impairment, the company according to age analysis accrual impairment provision. According to the group of other receivables provision for more than 2 years of age receivables, via test no impairment, according to age analysis accrual impairment provision.
Closing single amount significant and single provision for accounts receivable
||||||
|-|-|-|-|-|
|||||Type (or contents) of other|
|Name of debtors|Amount|Provision|Proportion||
|||||receivables|
|Beijing Picom|||||
|Telecommunications|28,912,122.71|28,912,122.71|100.00%|Receivables and payables|
|Equipment Co., Ltd.|||||
|Total|28,912,122.71|28,912,122.71|--|--|

Adopt age analysis provision in group as follows:
||||||||||
|-|-|-|-|-|-|-|-|-|
||As of 30 June 2014||||As of 31 December 2013||||
|Age|Book balance||||Book balance|||Reserve for bad debts|
|||||Reserve for bad debts|||||
||Amount|Percentage (%)|||Amount|Percentage (%)|||
|Within 1 year|||||||||
||720,645.00||3.04%||13,985,538.10||24.97%||
|(contain 1 year)|||||||||
|1 to 2 years|553,770.84||2.34%||18,099,703.03||32.31%||
|2 to 3 years|3,226,486.62||13.59%|322,648.67|1,229,403.73||2.19%|122,940.37|
|3 years or above|19,235,920.96||81.03%|9,531,268.14|22,708,344.52||40.53%|10,354,888.31|
|3 to 4 years|1,090,358.32||4.59%|327,107.50|2,560,408.10||4.57%|768,122.43|
|4 to 5 years|14,560,408.10||61.34%|5,824,163.24|17,418,567.57||31.09%|6,967,427.03|
|5 years or above|3,585,154.54||15.10%|3,379,997.40|2,729,368.85||4.87%|2,619,338.85|
|Total|23,736,823.42||--|9,853,916.81|56,022,989.38||--|10,477,828.68|

||||||
|-|-|-|-|-|
|Receivables|Book amount|Bad debt|Proportion|Reason|
|single amount not significant|||||
|||||Aging longer difficult to|
|and single provision for|4,085,166.33|4,085,166.33|100.00%||
|||||recover|
|other receivables|||||
|Total|4,085,166.33|4,085,166.33|--|--|

(2) Current payback or return of receivables
During this period no full provision for bad prophase preparation, or larger proportion, but in this period fully recovery or payback, or recovery or
payback larger proportion of account receivable.
(3) Accounts receivable due from shareholder who has more than5% (including 5%) voting shares of the Company at year-end
The outstanding amount of the parent company China Putian Information Industry Co. arrears of RMB 17,500.00 Yuan, aged less than 1 year. (4) Large amount of other receivables nature or content
||||||
|-|-|-|-|-|
||As of 30 June 2014||As of 31 December 2013||
|Name|||||
||Book amount|Bad debt|Book amount|Bad debt|
|China Potevio Information Industry Co.,|||||
||360,680.00|0.00|17,500.00|0.00|
|Ltd.|||||
|Total|360,680.00|0.00|17,500.00|0.00|

 (5) Large amount of other receivables nature or content
||||
|-|-|-|
|Name of the debtors|Amount|Other receivables nature or content|
|Beijing Picom Telecommunications Equipment Ltd|28,912,122.71|Aging longer difficult to recover|
|Yuhua Peoples‘ Government Nanning Office|12,000,000.00|Receivables and payables|
|Total|40,912,122.71|——|

(6) Top 5 debtors of other receivables
||||||
|-|-|-|-|-|
||Relationship with the|||Proportion of total amount|
|Name of debtors||Amount|Aging||
||Company|||(%)|
|Beijing Picom|||||
|Telecommunications|Related party|28,912,122.71|More than 6 years|39.92%|
|Equipment Co., Ltd.|||||
|Yuhua Peoples‘ Government|||||
||Non –related party|12,000,000.00|4 to 5 years|16.57%|
|Nanning Office|||||
|Nanjing Southern|||||
|Telecommunications|Subsidiary|1,461,598.51|Within 2 year|2.02%|
|Company Ltd..|||||
|Henan Zhongguang|||||
|Information Network Co.,|Non –related party|1,000,000.00|More than 6 years|1.38%|
|Ltd.|||||
|China Mobile Group Jiangsu|||||
||Non –related party|730,000.00|4 to 5 years|1.01%|
|Co.|||||
|China Mobile Group Jiangsu|||||
||Non –related party|250,000.00|More than 6 years|0.35%|
|Co.|||||
|Total|--|44,353,721.22|--|61.25%|

(7) Other receivables from related parties
|||||
|-|-|-|-|
|Name of debtors|Relationship with the Company|Amount|Proportion of total amount (%)|
|Beijing Picom||||
|Telecommunications Equipment|Related party|28,912,122.71|39.92%|
|Co., Ltd.||||
|Nanjing Southern||||
|Telecommunications Company|Subsidiary|1,461,598.51|2.02%|
|Ltd..||||
|China Potevio Information|Parent company|||
|||360,680.00|0.50%|
|Industry Co., Ltd.||||
|Nanjing Putian|Subsidiary|||
|Telecommunication Technology||54,539.96|0.08%|
|Co., Ltd.||||
|Total|--|30,788,941.18|42.52%|

 3. Long-term equity investments
(1) List of Information of Long-term Equity Investment
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
||||||||Voting|Descriptio||||
|||||||Share|right|n about||||
|||||||||||Impairme||
|||||||holding|proporti|inconsiste||||
||||Book||Book|||||nt|Cash|
|||||||percenta|on of|nt in||||
||Accounti||balance at||balance at|||||provision|dividends|
|||Initial cost of||Movemen||ge of the|the|shareholdi|Impairment|||
|Invested units|ng||the end of 31||the end of 31|||||withdraw|during|
|||investment||t||Company|Compan|ng and|provision|||
||Method||December||December|||||n during|the|
|||||||among|y among|voting||||
||||2013||2013|||||the|period|
|||||||invested|invested|rights of||||
|||||||||||period||
|||||||units) (%)|units)|the||||
||||||||(%))|investee||||
|Nanjing Southern||||||||||||
|Telecommunicati|Cost|33,175,148.0|33,175,148.0||33,175,148.0|||||||
|||||||98.24%|98.24%|||||
|ons Company|Method|0|0||0|||||||
|Limited||||||||||||
|Nanjing Putian||||||||||||
||Cost|||||||||||
|Telege Intelligent||3,320,003.45|3,320,003.45||3,320,003.45|45.77%|45.77%|||||
||Method|||||||||||
|Building Ltd.||||||||||||
|Nanjing Putian||||||||||||
|Changle|Cost|||||||||||
|||2,610,457.00|2,610,457.00||2,610,457.00|50.70%|50.70%|||||
|Telecommunicati|Method|||||||||||
|ons Equipment||||||||||||

||||||||||
|-|-|-|-|-|-|-|-|-|
|Co., Ltd.|||||||||
|Nanjing Bada|||||||||
||Cost||||||||
|Telecommunicati||5,610,000.00|5,610,000.00||5,610,000.00|60.00%|60.00%||
||Method||||||||
|ons Co., Ltd|||||||||
|Nanjing Putian|||||||||
|Wongshi|Cost|40,997,683.0|40,997,683.0||40,997,683.0||||
|||||||99.42%|99.42%||
|Telecommunicati|Method|0|0||0||||
|ons Co., Ltd.|||||||||
|Nanjing Putian|||||||||
||Cost||||||||
|Network||9,146,455.13|7,741,140.41||7,741,140.41|78.00%|78.00%||
||Method||||||||
|Company Ltd.|||||||||
|Putian|||||||||
|Telecommunicati|Cost||||||||
|||1,910,520.00|1,910,520.00||1,910,520.00|90.00%|90.00%||
|ons (Hong Kong)|Method||||||||
|Co., Ltd.|||||||||
|Nanjing Putian|||||||||
|Information|Cost|13,860,000.0|13,860,000.0||13,860,000.0||||
|||||||99.98%|99.98%||
|Technology|Method|0|0||0||||
|Company Ltd.|||||||||
|Nanjing Putian|||||||||
|Telecommunicati|Cost||||||||
|||1,294,510.00|1,294,510.00||1,294,510.00|70.00%|70.00%||
|on Technology|Method||||||||
|Co., Ltd.|||||||||
|Beijing Picom|||||||||
|Telecommunicati|Cost|||||||1,854,910.|
|||1,854,910.00|1,854,910.00||1,854,910.00|51.00%|51.00%||
|ons Equipment|Method|||||||00|
|Ltd|||||||||
|Nanjing Yahua|||||||||
||Cost||||||||
|Galvanization||420,915.00|420,915.00||420,915.00|10.00%|10.00%||
||Method||||||||
|Factory|||||||||
|Hangzhou|||||||||
|Swanking|Cost||||||||
|||321,038.00|321,038.00||321,038.00|2.26%|2.26%||
|Electric|Method||||||||
|Appliance|||||||||
|Nanjing|||||||||
|Mennekes|||||||||
||Cost|15,037,508.0|57,831,011.7||57,831,011.7||||
|Electric||||||75.00%|75.00%||
||Method|0|1||1||||
|Appliances Co.,|||||||||
|Ltd.|||||||||
|Nanjing Putian|Equity|5,212,328.80|4,326,243.64|886,085.1|5,212,328.80|40.00%|40.00%||

||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
|Datang|Method|||6|||||||
|information|||||||||||
|electronic Co.,|||||||||||
|Ltd.|||||||||||
|Nanjing Putian|||||||||||
|Zhongyou|Equity||||||||||
|||300,000.00|219,528.61||219,528.61|30.00%|30.00%||||
|Telecommunicati|Method||||||||||
|on Co., Ltd.|||||||||||
|Nanjing Putian|||||||||||
||Equity|167,548,141.|168,922,896.|-37,324.4|168,885,571.|||||297,840.|
|High Technology||||||49.64%|49.64%||||
||Method|29|40|5|95|||||00|
|Industry Co., Ltd.|||||||||||
|Nanjing|||||||||||
|Prachanda Live|Equity|13,544,400.0|13,740,859.9|-989,488.|12,751,371.5||||||
|||||||50.00%|50.00%||||
|Optical Network|Method|0|1|38|3||||||
|Co., Ltd.|||||||||||
|||316,164,017.|358,156,865.|-140,727.|358,016,137.||||1,854,910.|297,840.|
|Total|--|||||--|--|--|||
|||67|13|67|46||||00|00|

 4. Operating revenues and costs
(1) Operating revenues
||||
|-|-|-|
|Item|Jan. to Jun. 2014|Jan. to Jun. 2013|
|Main operating revenue|590,311,613.59|713,341,159.34|
|Other operating revenue|24,365,875.65|12,273,902.91|
|Total|614,677,489.24|725,615,062.25|
|Operating costs|552,638,621.78|655,279,644.09|

 (2) Operating costs
||||
|-|-|-|
|Item|Jan. to Jun. 2014|Jan. to Jun. 2013|
|Main operating cost|532,025,730.03|644,761,608.58|
|Other operating cost|20,612,891.75|10,518,035.51|
|Total|552,638,621.78|655,279,644.09|

(3) Main Business (In terms of different products)
||||||
|-|-|-|-|-|
||Jan. to Jun. 2014||Jan. to Jun. 2013||
|Item|||||
||Main operating revenue|Main operating cost|Main operating revenue|Main operating cost|
|Communication products|590,311,613.59|532,025,730.03|713,341,159.34|644,761,608.58|
|Total|590,311,613.59|532,025,730.03|713,341,159.34|644,761,608.58|

(4) Main business items listed by Industry
||||||
|-|-|-|-|-|
||Jan. to Jun. 2014||Jan. to Jun. 2013||
|Item|||||
||Main operating revenue|Main operating cost|Main operating revenue|Main operating cost|
|Communications equipment|||||
||590,311,613.59|532,025,730.03|713,341,159.34|644,761,608.58|
|industry|||||
|Total|590,311,613.59|532,025,730.03|713,341,159.34|644,761,608.58|

 (5) Main Business (In terms of different regions)
||||||
|-|-|-|-|-|
||Jan. to Jun. 2014||Jan. to Jun. 2013||
|Area Name|||||
||Main operating revenue|Main operating cost|Main operating revenue|Main operating cost|
|Domestic market|588,808,024.18|530,863,284.56|713,189,349.68|644,657,596.57|
|Oversea market|1,503,589.41|1,162,445.47|151,809.66|104,012.01|
|Total|590,311,613.59|532,025,730.03|713,341,159.34|644,761,608.58|

 (6) The amount of operating revenues received from the top 5 customers this year
||||
|-|-|-|
|||Proportion taking in total|
|Item|operating revenues|operating income of the|
|||Company (%)|
|China Telecom Co., Ltd & Controlled Subordinate Enterprises|356,004,796.54|57.92%|
|China Mobile Co., Ltd & Controlled Subordinate Enterprises|121,777,687.79|19.81%|
|China United Network Co., Ltd &Controlled Subordinate Enterprises|56,047,427.97|9.12%|
|Nanjing Yuanda Information Technology Co., Ltd.|11,310,111.11|1.84%|
|Quanzhou Huahe Communication Technology Co., Ltd.|16,795,143.59|2.73%|
|Total|561,935,167.00|91.42%|

 5. Investment income
(1) Details of Investment Income
||||
|-|-|-|
|Item|Jan. to Jun. 2014|Jan. to Jun. 2013|
|Long-term equity investment income by equity method|157,112.33|-1,862,331.47|
|Total|157,112.33|-1,862,331.47|

 (2) Long-term equity investment income by cost method
None
(3) Long-term equity investment income by equity method
|||||
|-|-|-|-|
|Investee|Jan. to Jun. 2014|Jan. to Jun. 2013|Reasons for movement|

|||||
|-|-|-|-|
|Nanjing Prachanda Live Optical Network Co., Ltd.|-989,488.38|-2,559,926.08|Business fluctuations|
|Nanjing Putian Datang information electronic Co.,||||
||886,085.16|477,145.68||
|Ltd.|||Business fluctuations|
|Nanjing Putian High Technology Industry Co., Ltd.|260,515.55|220,448.93|Business fluctuations|
|Total|157,112.33|-1,862,331.47|--|

6. Supplementary information about consolidated statement of cash flows
||||
|-|-|-|
|Item|Jan. to Jun. 2014|Jan. to Jun. 2013|
|1、Adjustment of net profit into operation activity cash flow：|--|--|
|Net profit|-22,812,040.37|-13,109,556.68|
|Add: impairment of assets|11,032.50|34,764.05|
|Depreciation of fixed assets, consumption of oil gas assets and|||
||2,127,553.33|2,420,609.59|
|depreciation of productive biological assets|||
|Amortization of intangible assets|316,630.23|423,561.03|
|Loss from disposal of fixed assets, intangible assets and other long term|||
||78,578.15||
|assets (gain is listed with ―-‖)|||
|Financial expense (gain is listed with ―-‖)|14,492,578.87|11,240,332.77|
|Investment loss (gain is listed with ―-‖)|-11,032.50|1,862,331.47|
|Decrease of inventories (increase is listed with ―-‖)|11,547,231.56|-4,517,187.53|
|Decrease of operational accounts receivable (increase is listed with ―-‖)|-41,566,727.77|-114,949,312.27|
|Increase of operational accounts payable (decrease is listed with ―-‖)|20,809,153.07|25,448,393.51|
|Net cash flow arising from operation activities|-15,007,042.93|-91,146,064.06|
|2、Significant investment and financing activities with no reference to cash|||
||--|--|
|collection and payment:：|||
|3、Net change in cash and cash equivalent:|--|--|
|Balance of cash at period-end|197,245,936.14|158,755,370.14|
|Less: Balance of cash at period-begin|217,989,348.06|267,226,515.29|
|Net increase in cash and cash equivalent|-20,743,411.92|-108,471,145.15|

 XIV. Supplementary Information
1. Non-recurring gains and losses of current year (Profit:+, loss: -)
||||
|-|-|-|
|Item|As of 30 June 2014|Note|
|Gains and losses from disposal of non-current assets, including reversal|-104,438.63||

||||
|-|-|-|
|of provision for impairment before|||
|Government subsidy recorded in current gains and losses,(except the|||
|fixed or quantitative government subsidy closely related to the enterprise|1,458,478.28||
|businesses and according to the national uniform standard)|||
|||The company's current non-recurring|
|||gains and losses are mainly|
|Income from the exceeding part between investment cost of the Company|||
|||generated from， the cost of acquire|
|paid for obtaining subsidiaries, associates and joint-ventures and|||
||3,276,764.14|subsidiary Nanjing Putian Datang|
|recognizable net assets fair value attributable to the Company when|||
|||information electronic Co., Ltd. less|
|acquiring the investment|||
|||than identifiable net assets at fair|
|||value RMB 3,276,764.14Yuan|
|In addition to the above other operating income and expenses|-295,414.67||
|Affect on minority equity(after taxation)|239,544.35||
|Affect on income tax|351,067.78||
|Total|3,744,776.99|--|

2. Return on equity and earnings per share
|||||
|-|-|-|-|
||Weighted average return on|Earnings per share||
|Profits of the reporting period||||
||equity（%）|Basic earnings per share|Basic earnings per share|
|Net profit attributable to shareholders of parent||||
||-2.49%|-0.0438|-0.0438|
|company||||
|Net profit attributable to shareholders of parent||||
|company after deduction of non-current gains and|-3.48%|-0.0612|-0.0612|
|losses||||

3. Description of the abnormality in the main accounting statement item
(1) Item of Income Statement
|||||||
|-|-|-|-|-|-|
|Item|Jan. to Jun. 2014|Jan. to Jun. 2013|Amount of movement|Proportion ofmovement|Note|
|Investment property|10,898,773.38|4,401,316.11|6,497,457.27|147.63%|Note1|
|Finance costs|15,922,237.55|11,488,031.64|4,434,205.91|38.60%|Note2|
|Non -operating income|4,748,462.85|1,927,667.56|2,820,795.29|146.33%|Note3|

 Note 1: During this period Nanjing Putian Datang information electronic Co., Ltd. was consolidated, resulting in a substantial increase in investment real estate; Note 2: Interest expense increased;
Note 3: Nanjing Putian Datang information electronic Co., Ltd. consolidated goodwill adjustment.