Dalian Refrigeration Co., Ltd. 2015Annual Report
Dalian Refrigeration Co., Ltd.
2015 Annual Report
March, 2016
1
Dalian Refrigeration Co., Ltd. 2015Annual Report
Section 1 Important Notice, Table of Contents, and Definitions
The directors and the Board of Directors, the supervisors and the
Supervisory Board, and Senior staff members of Dalian Refrigeration Co.,
Ltd. (hereinafter referred to as the Company) hereby confirm that there are
not any important omissions, fictitious statements or serious misleading
carried in this report, and shall take all responsibilities, individual and/or
joint, for the reality, accuracy and completeness of the whole contents.
Chairman of the Board of Directors of the Company Mr. Ji Zhijian,
Financial Majordomo Mr. Ma Yun and the head of Accounting Department
Mrs. Mao Chunhua hereby confirm that the financial report of the annual
report is true and complete.
All the directors have attended this Board meeting of the Company.
There is no significant risk having adverse influence on attainment of the
Company's future development strategy and business targets. The
paragraph "Development Prospect of the Company" in Section 4 of this
Annual Report describes major risks the Company may be confronted with,
including the risk of fiercer industrial competition, and the risk of backward
production equipment and process flow. See the related sections for the
countermeasures to be taken by the Company.
The profit distribution proposal reviewed and adopted at this Board meeting
of the Company is: Based on the total capital stock of 360,164,975 shares, the
dividend of RMB 1.00 in cash (including tax) will be distributed for every 10
shares, the total cash dividend is RMB 36.016 million, and the cash dividend
for B share is converted and paid in Hong Kong dollars; Based on the total
capital stock of 360,164,975 shares, the Company will transfer the capital
reserve to increase capital stock, 5 shares for every 10 shares.
This report is written respectively in Chinese and in English. In the event of
any discrepancy between the two above-mentioned versions, the Chinese
version shall prevail.
2
Dalian Refrigeration Co., Ltd. 2015Annual Report
CONTENTS
Section 1 Important Notice, Table of Contents, and Definitions ................................................................................2
Section 2 About the Company ....................................................................................................................................5
Section 3 Summary of Main Accounting Data and Financial Indicators....................................................................8
Section 4 Board of Directors' Report..........................................................................................................................9
Section 5 Important Issues........................................................................................................................................21
Section 6 Change in Share Capital and Shareholders' Information ..........................................................................29
Section 7 Information on Preferred Stock ................................................................................................................33
Section 8 Information on the Company’s Directors, Supervisors, Senior Management and Staff ........................... 34
Section 9 Corporate Governance ..............................................................................................................................40
Section 10 Financial Report .....................................................................................................................................43
Section 11 Contents of Reference Documents .......................................................................................................123
3
Dalian Refrigeration Co., Ltd. 2015Annual Report
Definitions
Defined item Stands for Meaning
Reporting period Stands for From Jan. 1, 2015 to Dec. 31, 2015
The Company, this Company Stands for Dalian Refrigeration Co., Ltd.
Wuhan New World Refrigeration Industries Co., Ltd., one of the
Wuxin Refrigeration Stands for subsidiary of the Company where the Company holds 100% of its
shares.
Dalian Bingshan Guardian Automation Co., Ltd., one of the
Bingshan Guardian Stands for controlled subsidiaries of this Company, where the Company holds
60% of its shares.
Dalian Sanyo High-Efficient Refrigeration System Co., Ltd. one of
Sanyo High-Efficient Stands for the controlled subsidiaries of this Company, where the Company
holds 55% of its shares.
Dalian Fuji-Bingshan Vending Machine Co., Ltd., one of the mutual
Dalian Fuji-Bingshan Stands for shareholding companies of this Company, where the Company holds
49% of its shares.
Panasonic Compressor (Dalian) Co., Ltd. one of the mutual
Panasonic Compressor Stands for shareholding companies of the Company, where the Company holds
40% of its shares.
Panasonic Cold-Chain(Dalian) Co., Ltd. one of the mutual
Panasonic Cold-Chain Stands for shareholding companies of the Company, where the Company holds
40% of its shares.
Panasonic Refrigeration Co., Ltd. one of the mutual shareholding
Panasonic Refrigeration Stands for companies of the Company, where the Company holds 40% of its
shares.
Changzhou Jingxue Freezing Equipment Co., Ltd. one of the mutual
Jingxue Freezing Stands for shareholding companies with this Company, where the Company
holds 29.212% of its shares.
Dalian Fuji-Bingshan Vending Machine Co., Ltd., one of the mutual
Dalian Fuji-Bingshan Stands for shareholding companies of this Company, where the Company holds
49% of its shares.
Keihin Grand-Ocean Cooling & Heating Industry (Dalian) Co., Ltd.,
Keihin Grand-Ocean Stands for one of the mutual shareholding companies with this Company, where
the Company holds 20% of its shares.
The Product Data Management system, a technology managing all
information and processes relating to products to provide
PDM Stands for information management in the whole life of product and establish a
parallel collaborative environment for product design and
manufacture within the enterprise.
The Enterprise Resource Planning system, a enterprise information
management system oriented to manufacturing industries for the
ERP Stands for
integration management of material resources, financial resources
and information resources.
4
Dalian Refrigeration Co., Ltd. 2015Annual Report
Section 2 About the Company
I. Company information
Short form of the stock DALENG GUFEN; DALENG-B
Stock code 000530; 200530
Listed stock exchange Shenzhen Stock Exchange
Legal name in Chinese 大连冷冻机股份有限公司
Legal English name and abbreviation Dalian Refrigeration Co., Ltd. DRC
Legal representative Ji Zhijian
Registered address and office address 888 Xinan Road, Shahekou District, Dalian
Post code 116033
Internet web site of the Company www.daleng.cn
E-mail of the Company 000530@bingshan.com
II. Contact persons and information
Secretary of the Board of Directors Authorized representative for securities affairs
Name Song Wenbao Song Wenbao (proxy)
DALENG GUFEN Securities﹠Legal Affairs DALENG GUFEN Securities﹠Legal Affairs
Address Department, No. 888, Xinan Road, Shahekou Department, No. 888, Xinan Road, Shahekou
District, Dalian District, Dalian
Tel. 0411-86538130 0411-86538130
Fax 0411-86654530 0411-86654530
E-mail 000530@bingshan.com 000530@bingshan.com
III. Information disclosure and place of preparation for inquiry
Name of the newspaper designated by the Company for China Securities Daily and Hong Kong
information disclosure Commercial Daily
Address of the website designated by China Securities
http://www.cninfo.com.cn
Regulatory Commission for publishing this Annual Report
Securities﹠Legal Affairs Department of the
Place where this Annual Report was prepared for inquiry
Company
IV. Alteration to the registration
Organization code No change
Change in main business since the Company was listed No change
Changes in the holding shareholder No change
V. Other related information
Accounting firm engaged by the Company
Name of accounting firm Da Hua Certified Public Accountants (Special General Partnership)
12/F,7th Building No.,16 Xi Si Huan Zhong Road, HaiDian District
Office location of accounting firm
Beijing, China
Name of signing certified public
Sui Guojun ,Wang Shuhuan
accountant
Sponsor the Company appointed for performance of the consistent supervision duty in the reporting period
5
Dalian Refrigeration Co., Ltd. 2015Annual Report
□ Applicable √ Not applicable
Financial consultant the Company appointed for performance of the consistent supervision duty in the reporting
period
□ Applicable √ Not applicable
VI. Main accounting data and financial indicators
Increase/decrease compared
2015 2014 2013
with previous year
Operating revenue 1,607,518,439.61 1,425,715,596.96 12.75% 1,535,706,911.25
Net profit attributable to shareholders of
129,947,307.39 115,439,722.39 12.57% 153,006,057.13
listed companies
Net profit belonging to the shareholders
of listed companies after the deduction 126,122,809.25 105,435,245.61 19.62% 121,207,821.52
of non-recurring profit and loss
Net cash flow from operating activities -50,568,474.38 28,495,772.47 -277.46% 7,630,456.44
Basic earning per share 0.36 0.33 9.09% 0.44
Diluted earnings per share 0.36 0.33 9.09% 0.44
Weighted average return on net asset Increase 0.4 percentage
6.38% 5.98% 8.27%
yield point
Increase/decrease compared At the end of
At the end of 2015 At the end of 2014
with previous year 2013
Total assets 4,082,499,864.42 3,053,930,248.25 33.68% 2,967,390,234.89
Owner's equity attributable to
2,647,609,091.41 1,967,027,256.13 34.60% 1,907,018,190.46
shareholders of listed companies
VII.1.Difference of accounting data between as per Chinese accounting standards and as per
International Accounting Standards
□ Applicable √ Not applicable
2. Difference of accounting data between as per Chinese accounting standards and as per
Foreign Accounting Standards
The difference of accounting data between as per Chinese Accounting Standards and as per International
Accounting Standards was 0.
VIII.The quarter main financial indicators
the first quarter the second quarter the third quarter the fourth quarter
Operating revenue 393,941,332.13 317,799,010.00 484,517,139.92 411,260,957.56
Net profit attributable to shareholders of listed
22,435,890.92 43,041,885.07 33,950,019.32 31,166,513.94
companies
Net profit belonging to the shareholders of listed
companies after the deduction of non-recurring 22,373,319.52 41,507,008.99 33,885,912.04 28,356,568.70
profit and loss
Net cash flow from operating activities -128,634,794.42 -1,955,126.95 -34,878,030.37 115,832,707.36
6
Dalian Refrigeration Co., Ltd. 2015Annual Report
IX. Non-recurring profits and losses and their amounts
item 2015 2014 2013
Disposal gains and losses of non-current asset -61,718.74 138,673.21 33,844,950.09
Tax returned/reduced by chance 499,945.82 441,073.42 905,596.59
Government subsidies included in current profit or loss 1,906,070.56 10,166,256.56 7,290,805.05
Debt restructuring gains and losses -586,377.00
Disposal gains from investments on financial assets
36,617.40
available for sale
Other non-operating revenue or expense 2,896,432.61 1,594,812.69 1,121,112.19
Influence on income tax 671,259.97 2,021,019.49 10,592,590.74
Influence on minority shareholders 158,595.14 351,937.01 771,637.57
total 3,824,498.14 10,004,476.78 31,798,235.61
7
Dalian Refrigeration Co., Ltd. 2015Annual Report
Section 3 The Company's Business profile
I. The Company’s Main business during the reporting period
The Company, as the largest industrial refrigeration equipment production enterprise in China, is committed to
developing the business of industrial refrigeration, food freezing and cold storage, central and commercial
air-conditioning, refrigeration components and engineering service, have covered the key areas of the refrigeration
industrial chain and forged the most complete cold and hot industrial chain in China.
II.Major changes in main assets
1. Major changes in main assets
Main seeets Explain for major changes
Construction in progress Significantly increased compared to the same ,mainly due to the new factroy construction.
Monetary funds Significantly decreased compared to the same，mainly due to the foreign investment increase.
Significantly increased compared to the same,mainly because of the complete sets of
Accounts receivable
Engineering for a larger proportion, the account receivable hasn't expired yet increase larger.
2. The main overseas assets
□ Applicable √ Not applicable
III. Analysis of core competence
Boasting the most complete cooling and heating product chain in the industry, the Company can offer to
customers the service of package projects from design, manufacture, installation to maintenance to well meet the
customized demand of customers.
Having the mature and perfect marketing network and after-sale service network, the Company can offer to
customers in more regions the more rapid and considerate high-quality service.
Taking refrigeration and air-conditioning as its main business, the Company effectively combines the independent
R&D and the joint ventures and cooperation, interacts positively between the integration of internal resources and
business model innovation, and has formed a unique development pattern appropriate to itself and the industry.
In the reporting period, the Company's core competence above-mentioned was improved further.
8
Dalian Refrigeration Co., Ltd. 2015Annual Report
Section 4 Management discussion and analysis
I. Summary
In 2015, despite of various challenges, the Company held confidence to accelerate integration of capital resources,
speed up business model innovation and optimize industry chain under the operating policy of “leading innovation
and creating value” pursuant to its middle-term development plan with supports from the effective implementation
of the first batch of restricted share option scheme, striving to enhance operation management quality, realize
operation target.
In 2015, the Company realized operating income of RMB 1,607.52 million, representing 97.43% of the annual
plan of RMB 1650 million and a year-on-year increase of 12.75%. The Company realized total profit of RMB
135.95 million, representing 90.63% of the annual plan of RMB150 million and a year-on-year increase of 9.65%.
The Company realized net profit attributable to shareholders of listed companies of RMB 129.95 million, with a
year-on-year increase of 12.57%.
During the reporting period, the Company mainly focused on food freezing and refrigeration, engineer trading and
services sectors to actively respond to market changes, aiming to deliver best value for customers. The Company
succeeded in execution of CO2 cascade refrigeration system-Beida Huangtaihua Project, which provided sample
project for the Company to further expand CO2 market. Riding on this project, it was able to improve the
comprehensive solution and special solutions with respect to full-auto logistic refrigerator, safety improvement of
ammonia system and pre-refrigeration in manufacturing places, enabling the Company to establish effective
connect with market demands and industry requirements.
During the reporting period, the Company accelerated integration of capital resources based on expectation on
growth and yield. It acquired 49% equity interests of Wuxin Refrigeration, making the latter to become its wholly
owned subsidiary instead of a holding subsidiary. Through this acquisition, it was expected to implement
integrated operation and deliver differential products. Besides, it acquired 30% equity interests of Sanyang
Gaoxiao, making the latter to become its holding subsidiary instead of an associate calculated under equity
method. Through this acquisition where it introduced private capital and innovative technology, the Company
strengthened its capability of heat exchange during the cooling and heating industry chain. Furthermore, it
improved efficiency through resources integration after it facilitated absorption and combination of Bingshan
Lingshe (a holding subsidiary) and Bingshan Metal Processing (a wholly-owned subsidiary). It also expanded
cold plate business through acquisition of 29.212% equity interests of Jingxue Refrigeration, which enabled the
Company to optimize industry layout and strengthen industry synergism.
During the reporting period, the Company continued to improve sales platform, construct service platform and
accelerate business model innovation. The sale platform Dalian Bingshan Group Sales Company Limited actively
innovated marketing model, emphasized comprehensive solution to satisfy higher requirements from market and
customers, and substantially enhanced its market influence and competitiveness. The service platform Bingshan
Technology Service (Dalian) Company has been put into official operation, recording enhancement of service
quality, expansion of service market, initial effects of service network construction, substantial increase of
accessories income and maintenance income, which remarked new service model for cooling and heating industry
and represented the switch of the Company from a refrigerator equipment supplier to refrigeration service
9
Dalian Refrigeration Co., Ltd. 2015Annual Report
supplier.
During the reporting period, the Company realized successful implementation of information construction projects
including PDM and ERP projects, which enabled it to achieve orderly improvement of refined management.
Construction of new smart plant is being promoted as scheduled.
During the reporting period, the Company actively facilitated construction of the virtual technology R&D
platform under cooperation between the parent company and Wuxin Refrigeration Company, and implemented its
plan to jointly develop new products. Design of pre-cooling equipments based on production bases and recycling
facilities have been completed and are available for commerce. Wuxin Refrigeration Company succeeded to
generate power by expansion of natural gas and to realize commercialization of cooling energy recycle machine
sets, realizing recycle of pressure energy from natural gas grid which filled the relevant blank in domestic market.
During the reporting period, its subsidiary Bingshan Jiade continued to develop and upgrade Bingshan IOT Cloud
management platform and energy management system, aiming to become the technology leader through
construction of technological entry barrier. The FSO series refrigeration fan energy saving controller as jointly
designed and manufactured by Bingshan Jiade can help the company to greatly improve its ability of saving
refrigeration energy.
During the reporting period, challenged by the reduced demands from traditional air conditioner operators, its
associated company Panasonic Compressor actively turned to develop freon system based refrigeration market,
targeting for continuous increase of sales of scroll horizontal compressors used by electric buses. R32 scroll
compressor was honored as an innovative product in the PRC refrigeration exhibition, which will take the
advantage in new coolant switch. Half-closed single compound two stage frequency conversion screw compressor
unit has successfully passed certification as scientific achievement, the overall technology of which was leading in
international market.
During the reporting period, its associated company Panasonic Refrigeration Link fully implemented
value-oriented marketing, transferring from market leader to market creator. It launched comprehensive solutions
including intelligent convenience shop and intelligent fresh delivery which filled market blanks. Besides, it
developed CO2 subcritical parallel refrigeration unit and completed upgrade and reform of CO2 refrigeration
systems in certain Metro shops. Through construction of flexible PULL production, it realized flexible production
in small quantity with various units, which obviously shortened the production cycle.
During the reporting period, its associated company Panasonic Refrigeration adequately adjusted marketing
strategy to divide brominating and lithiation markets in detail, and realized high temperature water double effects
and low temperature water single effect parallel refrigeration process for the first time. In relation to VRF market,
the company actively developed agents and mini stores to expand selling channels. For the first time also,
P-AIMS system was used to monitor energy utilization by air conditioner system, saving more than 10% of
energy.
During the reporting period, its associated company Dalian Fushi Bingshan innovated operating system, pursuant
to which, it established sales companies and developed beverage operators such as Nongfu Spring and Coca Cola.
Under the policy of intelligence, module, diversification and environment-friendly, the Company achieved rapid
growth with sales volume of over 23,000 units and substantial increase of selling income and net profit, through
10
Dalian Refrigeration Co., Ltd. 2015Annual Report
innovation of touch screen machines, goods combination, payment methods and post-sale service Wechat
platform. In addition, it also passed high-tech enterprise certification in Dalian, accomplishing monitor review on
quality, environment and occupation health & safety system.
During the reporting period, its associated company Keihin Grand-Ocean obtained the qualification of level A
supplier for Faw-Volkswagen, which laid firm foundation for it to obtain projects from Volkswagen.
Implementation of ERP system assisted the company to improve tracing quality of products.
II. Analysis of main business
1. Summary
See the related content “Section 4 Management discussion and analysis “ the “Summary”
2. Sales income and costs
(1) Sales income structure
2015 2014
Year-on-year
Proportion to the Proportion to the
Amount Amount increase/decrease
Sales costs Sales costs
Total sales income 1,607,518,439.61 100% 1,425,715,596.96 100% 12.75%
By industry
Refrigeration and
air-conditioning 1,590,994,011.67 98.97% 1,405,820,529.51 98.60% 13.17%
equipment
Others 16,524,427.94 1.03% 19,895,067.45 1.40% -16.94%
By product
Refrigeration and
air-conditioning 1,590,994,011.67 98.97% 1,405,820,529.51 98.60% 13.17%
equipment
Others 16,524,427.94 1.03% 19,895,067.45 1.40% -16.94%
By region
Northeast China 1,430,119,702.78 88.96% 1,127,931,075.94 79.11% 26.79%
Central China 159,483,265.64 9.92% 257,449,316.78 18.06% -38.05%
East China 17,915,471.19 1.12% 40,335,204.24 2.83% -55.63%
(2) Main business structure
Increase/decrease Increase/decrease
Gross Increase/decrease of gross
of operating of operating costs
Operating revenue Operating costs revenues on a on a year-on-year
profit on a year-on-year
profit year-on-year basis basis
basis
By industry
Refrigeration and Decrease 5.90
1,590,994,011.67 1,299,526,134.12 18.32% 13.17% 21.98%
air-conditioning percentage points
By product
Refrigeration and Decrease 5.90
air-conditioning 1,590,994,011.67 1,299,526,134.12 18.32% 13.17% 21.98%
equipment percentage points
By region
Decrease 5.70
Northeast China 1,413,595,274.84 1,154,152,493.78 18.35% 26.79% 34.87%
percentage points
Central China 159,483,265.64 130,495,335.59 18.18% -38.05% -33.75% Decrease 5.31
11
Dalian Refrigeration Co., Ltd. 2015Annual Report
percentage points
Increase 0.79
East China 17,915,471.19 14,878,304.75 16.95% -55.63% -56.00%
percentage points
(3)Was the Company's sales income on material objects more than that on labor service?
√ Yes □ No
Year-on-year
Industry category Item 2015 2014
increase/decrease
Sales volume 2,475 3,127 -20.85%
Main refrigeration unit for
Production output 2,457 3,108 -20.95%
industrial or commercial use
Inventory level 418 436 -4.13%
Reason for change in the related data by 30% or higher on a year-on-year basis
□ Applicable √ Not applicable
(4)Major orders in the hand of the Company
□ Applicable √ Not applicable
(5) Sales cost structure
2015 2014
Industry Proportion to Year-on-year
Item Proportion to the
category Amount the operating Amount increase/decrease
costs operating costs
Increase 2.12
Direct materials 1,122,739,260.55 85.72% 908,145,939.09 83.60%
percentage points
Decrease 0.01
Labor wages 115,116,769.44 8.79% 95,300,565.63 8.80%
percentage points
Refrigeration Decrease 0.58
Depreciation 25,191,991.42 1.92% 27,658,967.16 2.50%
and percentage points
air-conditioning Decrease 0.45
Utilities 15,079,414.99 1.15% 17,302,770.65 1.60%
percentage points
Decrease 1.08
Others 31,716,375.23 2.42% 38,142,410.20 3.50%
percentage points
Total operating
1,309,843,811.63 100.00% 1,086,550,652.73 100.00%
costs
(6) Was the Company's consolidated range change during the reporting period?
√Applicable □Not applicable
During the reporting period,The Company transfereed 30 percent equity from Sanyo High-Efficient, this will
make the Sanyo High-Efficient from the affiliated company accounted by equity method change to be subsidiary
of the company, bring it into the company consolidated statement scope.
During the reporting period, the subsidiary of the Company Bingshan Technical Service (Dalian) Co.,
Ltd.officially put into operation, bring it into the company consolidated statement scope.
(7) Major change or adjustment in the Company's products or service in the reporting period
□ Applicable √ Not applicable
(8) Information on the Company's major customers and major suppliers
Information on the Company's major customers
Total sales volume from top five customers (yuan) 298,782,035.85
Proportion of the total sales volume from top five customers to the annual sales volume (%) 18.59%
Information on the Company's top five customers
Sales volume Proportion to the annual
No. Name of customer
(yuan) sales volume
1 Panasonic Cold-chain (Dalian) Co., Ltd 71,856,798.06 4.47%
2 Shanghai Qingneng cole-chain equipment engineering Co., Ltd 71,070,880.35 4.42%
12
Dalian Refrigeration Co., Ltd. 2015Annual Report
3 Beijing Huashang Bingshan Refrigeration Equipment Co., Ltd. 64,232,868.76 4.00%
4 Dalian TianBao Green Foods Co., Ltd. 50,326,823.24 3.13%
5 Shenyang Railway Bureau Dalian project construction headquarters 41,294,665.44 2.57%
Total —— 298,782,035.85 18.59%
Information on the Company's major suppliers
Total purchase volume from top five suppliers (yuan) 340,996,499.92
Proportion of the total purchase volume from top five suppliers to the annual purchases volume (%) 32.19%
Information on the Company's top five suppliers
Purchase Proportion to the annual
No. Name of supplier
volume (yuan) purchase volume
1 Panasonic Cold-chain (Dalian) Co., Ltd 193,000,774.15 18.22%
2 Dalian Bingshan Engineering & Trading Co., Ltd. 71,456,746.91 6.75%
3 BAC Dalian Co., Ltd. 39,198,256.38 3.70%
4 Dalian Bingshan Group Refrigeration Equipment Co., Ltd 19,240,996.98 1.82%
5 Wuhan Zhonghui explosion-proof control system Co., Ltd. 18,099,725.50 1.71%
Total —— 340,996,499.92 32.19%
3. Expenses
Increase/decrease of
2015 2014 gross profit on a Explain for major changes
year-on-year basis
mainly because after the service platform established, the
corresponding human cost from original after-sale service
business, which reckoned in sales expenses, are calculated in the
selling
80,099,755.98 123,270,829.61 -35.02% business costs under the name of Bingshan Technology Service
expenses
(Dalian) Co., Ltd.; and sales resources of the parent company
and subsidiaries are integrated after sales platform established,
thus the cost reduced and benefit increased
administra
tive 187,046,595.49 185,701,061.45 0.72%
expenses
financial mainly because the interest on loan increase and the time
130,314.66 -6,114,199.04 102.13%
expenses deposits interest income declined.
4. R&D expenditure
In the reporting period, the Company had the total R&D expenditure of 80.86 million yuan, accounting for 3.05%
of the Company's net assets as of the end of 2015 or 5.03% of the Company's annual operating revenues. There
was no remarkable year-on-year change in related data.
Information on R&D expenditure
Increase/decrease of gross profit on a
2015 2014
year-on-year basis
The quantity of the person engaged in R&D 265 244 8.61%
The quantity proportion of the person engaged in
14.00% 12.00% Increase 2.00 percentage points
R&D
13
Dalian Refrigeration Co., Ltd. 2015Annual Report
The spending amount on R&D（yuan） 80,858,177.51 73,570,000.00 9.91%
R&D spending accounts for the proportion of
5.03% 5.16% Decrease 0.13 percentage points
revenue
The amount of R&D investment （yuan） 0.00 0.00
5. Cash flows
Year-on-year
Item 2015 2014
increase/decrease
Sub-total of cash inflows from operating activities 1,240,977,616.64 1,128,325,804.20 9.98%
Sub-total of cash outflows from operating activities 1,291,546,091.02 1,099,830,031.73 17.43%
Net amount of cash flow generated in operating activities -50,568,474.38 28,495,772.47 -277.46%
Sub-total of cash inflows from investing activities 66,925,062.39 67,895,523.90 -1.43%
Sub-total of cash outflows from investing activities 303,324,669.75 63,987,418.04 374.04%
Net amount of cash flow generated in investing activities -236,399,607.36 3,908,105.86 -6,148.96%
Sub-total of cash inflows from financing activities 222,387,876.63 78,354,272.75 183.82%
Sub-total of cash outflows from financing activities 189,088,218.64 137,330,113.53 37.69%
Net amount of cash flow generated in financing activities 33,299,657.99 -58,975,840.78 154.88%
Net increase in cash and cash equivalents -253,833,454.79 -26,781,570.96 -847.79%
Reason for change in the related data by 30% or higher on a year-on-year basis
√ Applicable □ Not applicable
1.Net cash flow arising from operation activities have a significant decreased on a y-o-y basis, mainly because the
cash paid for purchasing commodities and receiving labor service are increased in the Period;
2.Net cash flow arising from investment activities have a significant decreased on a y-o-y basis, mainly because
the equity transfer amount paid in the Period;
3.Net cash flow arising from financing activities have a significant increased on a y-o-y basis, mainly because the
equity subscription of the restricted shares from incentive objects are received in the Period.
Reason for remarkable difference between the cash flows from the Company's operating activities in the reporting
period and the net annual profit
√ Applicable □ Not applicable
There was a remarkable difference between the net amount of cash flow generated in operating activities of the
Company and the net annual profit in the reporting period, mainly due to that the proportion of returns on
investment to the total profit of the Company was higher.
III. Analysis of the non-main business
□ Applicable √ Not applicable
IV. Analysis of assets & liabilities
1. Remarkable change in assets
Monetary unit: RMB yuan
End of 2015 End of 2014
Proportion to Proportion to Proportion increase/decrease
Amount Amount
the total assets the total assets
Monetary funds 244,789,824.53 6.00% 508,511,466.02 16.65% Decrease 10.65 percentage points
Accounts receivable 671,423,836.87 16.45% 438,880,830.12 14.37% Increase 2.08 percentage points
Inventories 259,099,149.47 6.35% 314,879,106.56 10.31% Decrease 3.96 percentage points
Investment property 24,497,584.00 0.60% 25,108,909.00 0.82% Decrease 0.22 percentage points
Long-term equity 1,039,229,738.8
1,220,367,767.73 29.89% 34.03% Decrease 4.14 percentage points
investment 5
Fixed assets 449,907,430.32 11.02% 414,293,269.31 13.57% Decrease2.55 percentage points
Construction in
137,025,384.58 3.36% 18,515,449.46 0.61% Increase2.75 percentage points
progress
14
Dalian Refrigeration Co., Ltd. 2015Annual Report
Short-term loans 82,600,000.00 2.02% 60,000,000.00 1.96% Increase0.06 percentage points
Long-term loans 0.00 0.00
2. assets & liabilities which are measrued by fair value
√ Applicable □ Not applicable
Finance asset held available for sales in fair value Changes in fair value included in the rights and interests of the
cumulative of the current period is 587,219,831.33yuan，the final number is 719,363,590.50 yuan.
V. Analysis of investments
1.The overall situation
√ Applicable □ Not applicable
Investment in 2015(yuan) Investment in 2014(yuan) Amount of variation
1,220,494,889.51 1,039,229,738.85 17.44%
2.The significant equity investment during the reporting period
During the reporting period，the Company purchased the 29.212 percent equity of Jingxue Freezing with its own
fund,the detailes see the revelvant announcement at http:// www.cninfo.com.cn on July 8,2015.
3 The significant non-equity investment during the reporting period
□ Applicable √ Not applicable
4.The financial asset investment
(1) the securities investment
□ Applicable √ Not applicable
(2) Derivative investment
□ Applicable √ Not applicable
During the reporting period, the Company does not exist derivative investment.
5. The use of funds raised
□ Applicable √ Not applicable
During the reporting period, the Company does not exist the use of funds raised.
VI. The material assets and equity sale
1. The material assets sale
□ Applicable √ Not applicable
2. The material equity sale
□ Applicable √ Not applicable
VII. Analysis of major subsidiary companies and mutual shareholding companies
√ Applicable □ Not applicable
15
Dalian Refrigeration Co., Ltd. 2015Annual Report
Operating Net
net Operating
profit profit
registered total assets (ten assets(ten income
Company name type The main business (ten (ten
capital thousand yuan) thousand (ten thousand
thousand thousand
yuan) yuan)
yuan) yuan)
Panasonic participating Refrigeration and JPY 6,200
174.508 115,764 189,436 18,924 16,135
Compressor company air-conditioning million
participating Refrigeration and JPY
Fuji Bingshan 42,294 23,116 46,308 6,885 5,854
company air-conditioning 1,800million
Keihin participating Refrigeration and USD15.11789
38,463 24,304 68,031 10,676 7,937
Grand-Ocean company air-conditioning million
Subsidiary companies obtained or disposed in the reporting period
√Applicable □ Not applicable
the way of obtained or
disposed Subsidiary
Name The impact on overall production and performance
companies in the
reporting period
With need of internal resource integration and the heat ex-changer career development, The
Company transfereed 30 percent equity from Sanyo High-Efficient, this will make the Sanyo
High-Efficient from the affiliated company accounted by equity method change to be subsidiary
Sanyo of the company, bring it into the company consolidated statement scope.
Transferee equity
High-Efficient Through the equity integration, the Sanyo High-Efficient will expand the product type, increase
the technical strength, and promote internal management. On the basis of strengthen the internal
heat ex-changer matching, to develop external market effectively, improve profitability and
sustainable development. Thereby, bring good investment returns to the company.
VIII. The sturctured corporte bodies which the Company controlled
□ Applicable √ Not applicable
IX. Development prospect of the Company
1. Industry development trend
The Company operates in cooling air conditioner industry. Currently, cooling air conditioner industry brings
increasing influence on national economy, being more important in improving living conditions. Therefore, it
receives more and more society concern with higher industrial concentration and more furious market competition.
The industry is experiencing rapid development in terms of complete set, module and information. New
enterprises continue to enter into this market, thus to continuously introduce new hotspots. Besides, the competing
areas, competitors, products and contents are also changing all the time.
Development of this industry experiences new normal. Capacity surplus of middle and low end products will
definitely lead to increasingly furious price competition, while there remains huge space for high end products and
division of precise market demands. Market demands decide business model of enterprises. As competition will
turn to that in project service capability instead of single product, enterprises are urged to promote transformation.
Certain international brands including York, GEA and Mayekawa will introduce into domestic market with high
end products and technology solutions. Therefore, seeking for active independent innovation by domestic brands
16
Dalian Refrigeration Co., Ltd. 2015Annual Report
constitutes the main subject of industry development. Market leaders have formed new competition layout
through asset acquisition and reorganization.
2. opportunities and challenges
(1) Opportunities
As urbanization accelerates and more national resources are injected to food and sanity areas, cold chain logistics
sector records great development. It is expected that freezing and refrigeration markets will keep relatively high
increase, resulting in expansion of market demands for our major products. Inventory management in whole sets
and energy and safety improvement in freezing stations bring new market demands provide realistic opportunities
for the Company to dramatically explore modern service sector. By virtue of new business model, strong
technology strength and advantages of intelligent plants, the Company is well prepared to capitalize such
opportunities.
(2) Challenges
As competition environment varies, choices for consumers are getting larger with lower related costs. Increase of
competitors and substitutes leads to continuous decline of market occupation. Since competitors release new
products to market, our market share will be further reduced.
3. Development plan
Under the operation policy of “leading innovation, creating value” and taking its parent and subsidiaries as
development core, the Company will promote integrated operation, integrate internal and external resources,
upgrade industry chain, innovate business model, strengthen technological innovation, fully advance and expand
business scale and development space, raise staff benefits and realize sustainable, healthy and harmonic
development, laying firm foundation for construction of a hundred-year enterprise - Bingshan.
4. Capital requirements and capital source plan
In 2016, it is predicted that capital required will be financed by own capital and adequate financing.
5. Major risks and countermeasures of the Company
(1) Risk of increasing market competition
The substantial demands for refrigeration air conditioner market in China attract much attention from both
domestic and overseas enterprises. While developing the respective advantageous sectors, those enterprises also
continue to extent their industry chain, consolidate the established market area, and develop the emerging market,
which leads to more dramatic industrial competition.
Countermeasures: adhere to combination between fundamental improvement and mixture development,
combination between leading innovation and development cooperation, combination between green development
and quality effects, combination between overall optimization and emphasis breakthrough. With food freezing and
refrigeration segment and components segment as advanced areas, industrial refrigeration segment as strategic
area, central and commercial air conditioner segment, project trading and service segment as major expansion
areas, the Company reinforces exploration into new business segments. Through inventory management and
production capacity improvement, the Company continues to optimize business structure and strengthen
development momentum.
17
Dalian Refrigeration Co., Ltd. 2015Annual Report
(2) Risk of backward production facilities and craft process
The Company is an old enterprise, also an old plant, where craft process and facilities are hard to catch up the
latest development trend and market requirements.
Countermeasures: the Company is enabled to obviously improve its product technology level, production craft
level, production and operation efficiency, capability of manufacturing as well as product quality by virtue of
business procedure reform, optimization of organization structure, improvement of business layout and
introduction of new technology, crafts and equipments during the relocation and reform process, so as to better
satisfy competition trend and market requirements.
(3) Risk of relatively high account receivables
Countermeasures: by means of controlling increments and reducing stocks for reinforced management over
account receivables, the Company gradually reduces the balance of account receivables to a reasonable level. New
account receivables are managed to control through financing lease, decrease or cancellation of deposits and
adoption of banking credit tools as deposits. Special solutions are also established to increase settlement of
account receivables owed in a long term.
6. Operation plan for 2016
Sales income: RMB 1,800 million, representing an increase of approximately 12% as compared to that of RMB
1607.52 million recorded in 2015.
Total profit: RMB 155.00 million, representing an increase of approximately 14% as compared to that of RMB
135.95 million recorded in 2015.
In 2016, the Company will adhere to the subject of “innovation, improvement and enhancement”, pursuant to
which, it will innovation industrial development model, strengthen R&D of technological products, reinforce
general plan of relocation and reform, accelerate capital resources integration, speed up fundamental management
improvement, optimize competition capability and enhance operation efficiency, to ensure accomplishment of the
targets relating to operating income and profit index in 2016.
The major works to be done in 2016:
1. Innovation of industrial development model. Centralized with Dalian, the Company endeavors to build an
industrial base integrated with Dalian, Wuhan and Changzhou, expecting to optimize its industrial layout. In
addition, with cooling and heating technology as the main line, it insists on prime quality, advanced structure and
green development, facilitating the transformation from manufacturer enterprise to productive service provider. In
terms of smiling curve, the Company enhances the button of the curve and expands both ends of the curve, aiming
for getting closer to a middle and high end manufacturer. Besides, it also strengthens its capability of research and
development, project construction and services. Through establishment of project companies, it drives forward
products sales by leveraging on project design and project contracting, creating new value for customers.
2. Increase product research and development. With the subject of safety, environment and intelligence, the
Company focuses on development of new products and technologies and optimization of old products in
accordance with its products development planning. Moreover, research on practical application has been
emphasized, so as to deliver differential products based on customers’ needs. The Company increases capital
investment in research and development to enhance its comprehensive capability.
18
Dalian Refrigeration Co., Ltd. 2015Annual Report
3. Consolidate general planning for relocation and reform. Through establishment of detailed relocation plan and
guarantee measures, the Company is assured to complete relocation on time and successfully. A pre-relocation
capacity reserve plan should be made properly to make sure that market share of the Company would not be
affected during relocation.
4. Accelerate capital resources integration. To fully capitalize the financing platform as a listed company, the
Company endeavors to enhance its capability in financing and industrial integration. Besides, it shall determine
capital relation and optimize quality of resources, to provide quality stocks on a flexible basis. It also seeks for
construction of a business entity with the parent as the main investment body and supports from emerging and
existing businesses. It targets for improvement and enhancement of industrial chain to deliver increasing products.
5. Speed up fundamental management improvement. Performance access system involving the entire staff and
operation process shall be established to strengthen performance management. It shall establish and enhance
growth mechanism with respect to management and technical talents both. Through exercise of share option
scheme in batches, the Company expects to forge a community with undertakings and benefits. By adherence to
operation rules, the Company will further refine operation system documents to strengthen internal control.
Emphasis is also made on cash flow operation, account receivables and inventory management. The internal
review system relating to satisfaction of customers will be established to further minimize quality losses.
The above operation plan does not represent the profit forecast of 2016 by the listed issuer, and fulfillment of the
plan is subject to market conditions, efforts of operation team and other varieties, which means great uncertainties.
Investors are advised of particular caution.
X. Record of investigation, communication, interview and other activities in the reporting
period
Receiving time Way of receiving Received object type Basic situation index
Jan. 14, 2015 Field investigation Institution http:// www.cninfo.com.cn
Jan. 16, 2015 Field investigation Institution http:// www.cninfo.com.cn
Jan. 16, 2015 Field investigation Institution http:// www.cninfo.com.cn
Jan. 27, 2015 Field investigation Institution http:// www.cninfo.com.cn
Mar. 17, 2015 Field investigation Institution http:// www.cninfo.com.cn
Apr. 28, 2015 Field investigation Institution http:// www.cninfo.com.cn
May 7, 2015 Field investigation Institution http:// www.cninfo.com.cn
May 15, 2015 Field investigation Institution http:// www.cninfo.com.cn
Jun. 9, 2015 Field investigation Institution http:// www.cninfo.com.cn
Jun. 11, 2015 Field investigation Institution http:// www.cninfo.com.cn
Jul.1,2015 Field investigation Institution http:// www.cninfo.com.cn
Jul.15,2015 Field investigation Institution http:// www.cninfo.com.cn
Jul.31,2015 Field investigation Institution http:// www.cninfo.com.cn
Aug21, 2015 Field investigation Institution http:// www.cninfo.com.cn
Aug25, 2015 Field investigation Institution http:// www.cninfo.com.cn
Aug26, 2015 Field investigation Institution http:// www.cninfo.com.cn
Aug28, 2015 Field investigation Institution http:// www.cninfo.com.cn
Sep.16,2015 Field investigation Individual http:// www.cninfo.com.cn
19
Dalian Refrigeration Co., Ltd. 2015Annual Report
Sep.23,2015 Field investigation Institution http:// www.cninfo.com.cn
Oct.28,2015 Field investigation Institution http:// www.cninfo.com.cn
Oct.30,2015 Field investigation Institution http:// www.cninfo.com.cn
Nov.20,2015 Field investigation Institution http:// www.cninfo.com.cn
Dec.1,2015 Field investigation Institution http:// www.cninfo.com.cn
Dec.7,2015 Field investigation Institution http:// www.cninfo.com.cn
Dec.22,2015 Field investigation Institution http:// www.cninfo.com.cn
Number of reception 25
amount of reception for Institution 79
amount of reception for Individual 42
Whether to disclose, reveal or disclose
no
unpublished significant information
20
Dalian Refrigeration Co., Ltd. 2015Annual Report
Section 5 Important Issues
I Profit distribution and dividend payment
By giving consideration to both the return to shareholders and the Company's long-term development, and in
combination of the Company's profit made in the this year, the Company formulated the 2014 annual dividend
distribution plan of paying the cash of 1.5 yuan for every 10 shares. Reviewed and adopted at the Company's
general meeting, the Company's Board of Directors has implemented the plan in June 2015.
Formulation and implementation of the Company's cash dividend distribution policy in the reporting period
complied with the Company's Articles of Association and the general meeting's resolution, and the dividend
distribution standard and proportion were defined and clear and the applicable decision-making procedure and
system were complete. The independent directors agreed on it and the legal rights and interests of minority
shareholders were well protected.
Special notes to cash dividend payout policy
If the regulations of the Articles of Association or the requirements of the shareholders of
Yes
the company meeting are met:
If the dividend payout standard and proportion is definite and clear-cut: Yes
If relevant decision-making procedure and mechanism is complete: Yes
If the independent directors have performed their duties and played their due role: Yes
If small and medium shareholders have the opportunity to sufficiently express their
Yes
opinions and appeals and if their legal rights and interests are sufficiently protected:
If the condition and procedure for adjusting or changing the cash dividend payout policy
Yes
is compliant and transparent:
Table of profit distribution plan, plan of share-granting with capital accumulation fund of the Company in recent
three years
Plan of share-granting with
Dividend year Profit distribution plan
capital accumulation fund
with capital reserve every 10 turn
2015 RMB 1 yuan (cash) for every 10 shares (including tax)
add 5 shares.
2014 RMB 1.5 yuan (cash) for every 10 shares (including tax) None
2013 RMB 1.5 yuan (cash) for every 10 shares (including tax) None
Dividends in the annual consolidated net income Accounted for in the consolidated net
Cash dividend amount
year attributable to common shareholders of the income attributable to common
(tax included)
Company shareholders of the Company
2015 36,016,497.50 129,947,307.39 27.72%
2014 54,024,746.25 115,439,722.39 46.80%
2013 52,502,246.25 153,006,057.13 34.31%
The Company made profit in the reporting period and the undistributed profit of the parent company was positive
but no cash dividend distribution plan was proposed.
□ Applicable √ Not applicable
II Profit distribution preplan, and preplan of share-granting with capital accumulation fund
of the Company
Bonus shares to be presented for every 10 shares (shares) 0
Dividend to be distributed for every 10 shares (RMB yuan) (including tax) 1
Transferred shares to be presented for every 10 shares (shares) 5
Equity base for distribution preplan (shares) 360,164,975
21
Dalian Refrigeration Co., Ltd. 2015Annual Report
Total amount of cash dividend distribution (RMB yuan) (including tax) 36,016,497.50
Proportion of cash dividend distribution accounting for total profit distribution (%) 100.00%
Cash dividend distribution policy:
When the development stage of the company belongs to a growth period with important fund disbursement arrangement(s), the
proportion of cash dividend distribution accounting for this profit distribution should reach 20% at minimum when conducting profit
distribution.
Notes to details about preplan for profit distribution or capital stock increase with capital reserve
According to the audit by Da Hua CPAs (Special General Partnership), the net profit made by the parent company of the company in
2015 was RMB126,025 million and 10% of the net profit (RMB 12.603 million) was drawn as the legal surplus reserve. Therefore,
the profit distributable to the shareholders in the current year was RMB 113.422 million. Plus the initial undistributed profit of RMB
391.729 million and minus the dividend of RMB 54.025 million of common shares paid in 2014 and the drawn free surplus reserve of
RMB 22,379 million (20%), the accumulated profit distributable to the shareholders was RMB 428.747 million.
The company’s profit distribution preplan for 2015:
Based on the net profit made by the parent company of the company in 2015 (126.025 million), 20% of the net profit (RMB 25.205
million) will be drawn as the free surplus reserve;
Based on the total capital stock of 360,164,975 shares, the dividend of RMB 1.00 in cash (including tax) will be distributed for every
10 shares, the total cash dividend is RMB 36.016 million, and the cash dividend for B share is converted and paid in Hong Kong
dollars; Based on the total capital stock of 360,164,975 shares, the Company will transfer the capital reserve to increase capital stock,
5 shares for every 10 shares.
The above preplan shall be submitted to the 2015 shareholders’ general meeting for review and approval.
III Implementation of commitments
1. Commitments of the Company or its shareholders holding 5% or higher of the shares in the reporting
period or carried to the reporting period
The implementation for management equity incentive plan is being performed currently.
IV. Non-operation capital occupation by holding shareholders and their related parties in the
listed company
The company had no capital occupation by the holding shareholders and their related parties in the listed company
within this reporting period.
V.Explain to the “non standard audit report” from the board of directors, board of
supervisors of the Company
□ Applicable √ Not applicable
VI. Change in accounting policies, accounting estimates and accounting methods compared
with the financial statements of the previous year
□ Applicable √ Not applicable
VII. Correction of major accounting mistakes in the reporting period, which should be
retroactively restated
□ Applicable √ Not applicable
XIII. Change in the range of consolidated statements compared with the financial statements
of the previous year
√ Applicable □ Not applicable
During the reporting period,The Company transfereed 30 percent equity from Sanyo High-Efficient, this will
make the Sanyo High-Efficient from the affiliated company accounted by equity method change to be subsidiary
of the company, bring it into the company consolidated statement scope.
During the reporting period ,the subsidiary of the Company Bingshan Technical Service (Dalian) Co.,
Ltd.officially put into operation, bring it into the company consolidated statement scope.
22
Dalian Refrigeration Co., Ltd. 2015Annual Report
IX. Engagement and dismissal of the accounting firm
Currently engaged accounting firm
Name of domestic accounting firm Da Hua Certified Public Accountants (Special General Partnership)
Remuneration paid to the domestic accounting firm (in 10 thousand yuan) 77
Continuous audit service years of the domestic accounting firm 3
Name of certified public accountants with the domestic accounting firm Sui GuoJun , Wang Shuhuan
If the CPA firm retaining was changed in this period
□ Applicable √ Not applicable
Engagement of the Internal control audit certified public accountants , Financial advisor or sponsors
√Applicable □ Not applicable
In the year 2015，Company hired dahua certified public accountants (special ordinary partnership) as the company
internal control audit certified public accountants, internal control audit fee is RMB 300,000.
X.Facing suspend and terminate listing after the annual report disclosure
□ Applicable √ Not applicable
XI. Bankruptcy restructuring related matters
□ Applicable √ Not applicable
XII. Major lawsuit and arbitration issues
□ Applicable √ Not applicable
XIII. Punishment and rectification
□ Applicable √ Not applicable
XIV the credibility of companies and its controlling shareholder, actual controller
□ Applicable √ Not applicable
XV. The implementation and effect of equity incentive
√ Applicable □ Not applicable
On December 2014, The Company launched the first phase of restricted stock incentive plan, intend to grant10,
150 thousand shares restricted stock to the41 incentive object. On January, 2015, the CSRC conformed and
recorded without objection to the restricted stock incentive plan draft, On February, 2015, the 1st Extraordinary
Shareholders’ General Meeting of 2015 of the Company examined and adopted the restricted stock incentive plan
draft of the Company and its summary; On March 2015 the Board has implemented and completed granting the
restricted stock. The details see the series announcement on China Securities, HK Commercial Daily and Cninfo
website .
XVI. Important associated transactions
1.Important associated transactions
In the reporting period, the total amount of normal associated transactions between the Company and associated
parties was 664,540 thousand yuan, accounting for101.37% of the budgeted amount for the year 2015. This
included366,360 thousand yuan, accounting for100.77% of the budgeted amount for the year 2015, for purchasing
supporting products for package projects from associated parties, and 298,180 thousand yuan, accounting for
102.13% of the budgeted amount for the year 2015, from selling supporting parts and components to associated
parties.
2. Associated transactions related to purchases or sales of assets
□ Applicable √ Not applicable
There were no associated transactions related to purchases or sales of assets to the Company in this reporting
period.
3. Important associated transactions with joint external investments
□ Applicable √ Not applicable
4.Current associated rights of credit and liabilities
□ Applicable √ Not applicable
For credits and debts with associated parties, see the Special Description on Use of Funds by Dalian Refrigeration
Co., Ltd.'s Holding Shareholder and Other Associated Parties issued by Da Hua Certified Public Accountants.
5. Other associated transactions
√ Applicable □ Not applicable
According to the 18th meeting of the 6th Board of Directors.19 percent equity of Wuxin Refrigeration held by
Dalian Bingshan Group Co., Ltd. and 30 percent equity of Wuxin Refrigeration, held by Sanyo Electric Co., Ltd
was transferred to the Company .
According to the 20th meeting of the 6th Board of Directors,40 percent equity of Bingshan service held by
23
Dalian Refrigeration Co., Ltd. 2015Annual Report
Bingshan Engineering & Trading has been transferred to the Company totally.
The details see the series announcement on China Securities, HKCommercial Daily and Cninfo website on
June25,2015 and Auguest 21,2015.
XVII. Major contract and its performance
1. Hosting, contracting and leasing status
(1) the hosting status
□ Applicable √ Not applicable
(2)the contracting status
□ Applicable √ Not applicable
(3) the leasing status
Applicable □ Not applicable
The company signed rental contract with MHI Bingshan Refrigeration (Dalian) Co., Ltd., and rent # 6 workshop
building located on No. 106 Liaohe East Rd, Dalian Economic and Technology Development Zone to MHI
Bingshan Refrigeration (Dalian) Co., Ltd. The rental area is 15,259.04 square meters, and the rental term till 16th
July, 2029. The annual rent fee is RMB 4.2 million after considering the time value of money.
2. Guaranteeing status
□ Applicable √ Not applicable
3. Entrust others to cash assets management
(1)Trust management
□ Applicable √ Not applicable
(2)Entrusted loans
□ Applicable √ Not applicable
(3)Other important contracts
□ Applicable √ Not applicable
XVIII. Other important matters
□ Applicable √ Not applicable
XIX. Other important matters of subsidiary company
□ Applicable √ Not applicable
XX. Social responsibilities
√ Applicable □ Not applicable
For the specific performance of social responsibilities by the company, refer to the social responsibility report for
2015.
The listed company and its subsidiaries whether belong to heavy pollution industry formulated by the state
environmental protection department
□ Yes √ No
XXI. Corporate bonds
□ Applicable √ Not applicable
XXII. Index of information announcements for important matters within the reporting period
Announcement Website and path
No. Item Newspaper name and page for publishing Publishing date
for publishing
Public Notice on Receiving Record
China Securities Daily B030, Hong Kong
2015-001 without Objection from CSRC to the Jan. 10, 2015 http://www.cninfo.com.cn
Commercial Daily A16
Restricted stock Incentive Plan Draft.
2015-002 Announcement of the resolutions at the China Securities Daily B060, Hong Kong Jan. 23, 2015 http://www.cninfo.com.cn
24
Dalian Refrigeration Co., Ltd. 2015Annual Report
14th meeting of the 6th Board of Commercial Daily A18
Directors
Notice on convening the 1st China Securities Daily B060, Hong Kong
2015-003 Jan. 23, 2015 http://www.cninfo.com.cn
extraordinary general meeting in 2015. Commercial Daily A18
Statement of the Independent directors China Securities Daily B060, Hong Kong
2015-004 Jan. 23, 2015 http://www.cninfo.com.cn
candidates(Dai Dashuang) Commercial Daily A18
Statement of the Independent directors China Securities Daily B060, Hong Kong
2015-005 Jan. 23, 2015 http://www.cninfo.com.cn
candidates(Liu Jiwei) Commercial Daily A18
Statement of the Independent directors China Securities Daily B016, Hong Kong
2015-006 Jan. 23, 2015 http://www.cninfo.com.cn
nominee(To Dai Dashuang) Commercial Daily A14
Statement of the Independent directors China Securities Daily B016, Hong Kong
2015-007 Jan. 23, 2015 http://www.cninfo.com.cn
nominee(To Liu Jiwei) Commercial Daily A14
Report on the Independent directors China Securities Daily B060, Hong Kong
2015-008 Jan. 23, 2015 http://www.cninfo.com.cn
public solicitation of a proxy vote Commercial Daily A18
China Securities Daily B016, Hong Kong
2015-009 Estimated Performance for 2014 Jan. 23, 2015 http://www.cninfo.com.cn
Commercial Daily A14
Precautions Notice on Holding
st
China Securities Daily B016, Hong Kong
2015-010 the1 Extraordinary Shareholders’ Feb. 06, 2015 http://www.cninfo.com.cn
Commercial Daily A14
General Meeting of 2015
Announcement of the resolutions at the
China Securities Daily A37, Hong Kong
2015-011 1st extraordinary general meeting in Feb. 13, 2015 http://www.cninfo.com.cn
Commercial Daily A10
2015
Announcement of the resolutions at the
China Securities Daily B002, Hong Kong
2015-012 15th meeting of the 6th Board of Mar. 05, 2015 http://www.cninfo.com.cn
Commercial Daily B4
Directors
Announcement of the resolutions at the
China Securities Daily B002, Hong Kong
2015-013 9th meeting of the 6th Board of Mar. 05, 2015 http://www.cninfo.com.cn
Commercial Daily B4
Supervisors
Resolution of granting restricted stock China Securities Daily B002, Hong Kong
2015-014 Mar. 05, 2015 http://www.cninfo.com.cn
to incentive object Commercial Daily B4
Public Notice on Being Identified as China Securities Daily A16, Hong Kong
2015-015 Mar. 20, 2015 http://www.cninfo.com.cn
High-tech Enterprise Commercial Daily A10
Public Notice on Completion of China Securities Daily B007, Hong Kong
2015-016 Mar. 25, 2015 http://www.cninfo.com.cn
Granting Restricted Stock Commercial Daily A18
China Securities Daily B054, Hong Kong
2015-017 2014 Annual Report Summary Apr 24, 2015 http://www.cninfo.com.cn
Commercial Daily A18
Announcement of the resolutions at the
China Securities Daily B054, Hong Kong
2015-018 16th meeting of the 6th Board of Apr 24, 2015 http://www.cninfo.com.cn
Commercial Daily A18
Directors
Announcement of the resolutions at the
China Securities Daily B054, Hong Kong
2015-019 10th meeting of the 6th Board of Apr 24, 2015 http://www.cninfo.com.cn
Commercial Daily A18
Supervisors
2015-020 Notice on convening the 2014 annual China Securities Daily B054, Hong Kong Apr 24, 2015 http://www.cninfo.com.cn
25
Dalian Refrigeration Co., Ltd. 2015Annual Report
general meeting Commercial Daily A18
2015-021 Announcement of the 2015 annual
China Securities Daily B054, Hong Kong
estimation of routine associated Apr 24, 2015 http://www.cninfo.com.cn
Commercial Daily A18
transactions
2015-022 Quarterly Report for the First Quarter, China Securities Daily B054, Hong Kong
Apr 24, 2015 http://www.cninfo.com.cn
2015 Commercial Daily A18
2015-023 Statement of the Independent directors China Securities Daily B054, Hong Kong
Apr 24, 2015 http://www.cninfo.com.cn
candidates(Wang Yan) Commercial Daily A19
2015-024 Statement of the Independent directors China Securities Daily B054, Hong Kong
Apr 24, 2015 http://www.cninfo.com.cn
nominee(To Wang Yan) Commercial Daily A19
2015-025 Public Notice on Not Having Actual China Securities Daily B054, Hong Kong
Apr 24, 2015 http://www.cninfo.com.cn
Controller Commercial Daily A19
2015-026 Precautions Notice on Holding the 2014 China Securities Daily B054, Hong Kong
May. 14, 2015 http://www.cninfo.com.cn
annual general meeting Commercial Daily A19
2015-027 Announcement of the resolutions at the China Securities Daily B080, Hong Kong
May. 21, 2015 http://www.cninfo.com.cn
2014 annual general meeting Commercial Daily A7
2015-028 Public Notice on Trade Suspension
China Securities Daily B014, Hong Kong
Brought by Planning Private May. 25, 2015 http://www.cninfo.com.cn
Commercial Daily A6
Issuing of A-shares
2015-029 Public Notice on Progress of Planning
China Securities Daily B003, Hong Kong
Private Issuing of Jun.01, 2015 http://www.cninfo.com.cn
Commercial Daily A15
A-shares Matters
2015-030 Announcement of the resolutions at the
China Securities Daily B038, Hong Kong
17th meeting of the 6th Board of Jun.05, 2015 http://www.cninfo.com.cn
Commercial Daily A13
Directors
2015-031 Notice on convening the 2st China Securities Daily B038, Hong Kong
Jun.05, 2015 http://www.cninfo.com.cn
extraordinary general meeting in 2015. Commercial Daily A13
Public Notice on Related Transaction of
Equity Transfer ofDalian Sanyo China Securities Daily B038, Hong Kong
2015-032 Jun.05, 2015 http://www.cninfo.com.cn
High-Efficient Refrigeration System Commercial Daily A13
Co., Ltd.
2015-033 Public Notice on Trade Resumption
China Securities Daily B038, Hong Kong
Brought by Planning Private Issuing of Jun.05, 2015 http://www.cninfo.com.cn
Commercial Daily A13
A-shares
2015-034 Public Notice on the completion of the China Securities Daily B038, Hong Kong
Jun.05, 2015 http://www.cninfo.com.cn
change of business registration. Commercial Daily A13
2015-035 Public Notice of Dividend Distribution China Securities Daily B032, Hong Kong
Jun.16, 2015 http://www.cninfo.com.cn
for year of 2014 Commercial Daily A17
Precautions Notice on Holding the 2nd
China Securities Daily B032, Hong Kong
2015-036 Extraordinary Shareholders’ Jun.16, 2015 http://www.cninfo.com.cn
Commercial Daily A17
General Meeting of 2015
2015-037 Announcement of the resolutions at the
China Securities Daily B043, Hong Kong
2st extraordinary general meeting in Jun.25, 2015 http://www.cninfo.com.cn
Commercial Daily A7
2015
26
Dalian Refrigeration Co., Ltd. 2015Annual Report
2015-038 Announcement of the resolutions at the
China Securities Daily B043, Hong Kong
18th meeting of the 6th Board of Jun.25, 2015 http://www.cninfo.com.cn
Commercial Daily A7
Directors
Public Notice on Related Transaction of
Equity Transfer of China Securities Daily B043, Hong Kong
2015-039 Jun.25, 2015 http://www.cninfo.com.cn
Wuhan New World Refrigeration Commercial Daily A7
Industrial Co., Ltd.
Public Notice on Related Transaction of China Securities Daily B043, Hong Kong
2015-040 Jun.25, 2015 http://www.cninfo.com.cn
Rental Housing Commercial Daily A7
Public Notice of after the completement
of Dividend Distribution for year of
China Securities Daily B014, Hong Kong
2015-041 2014 to Adjustment of the reserve price Jun.30, 2015 http://www.cninfo.com.cn
Commercial Daily A7
and the number of shares issued for
Private Issuing of A-shares
Announcement of the resolutions at the
China Securities Daily B007, Hong Kong
2015-042 19th meeting of the 6th Board of July.08, 2015 http://www.cninfo.com.cn
Commercial Daily A9
Directors
2015-043 Public Notice on Purchasing the Equity
of China Securities Daily B007, Hong Kong
July.08, 2015 http://www.cninfo.com.cn
Changzhou Jingxue Freezing Commercial Daily A9
Equipment Co., Ltd.
Public Notice on Trade Suspension China Securities Daily B053, Hong Kong
2015-044 July.09, 2015 http://www.cninfo.com.cn
Brought by Significant Event Commercial Daily A16
The announcement of maintaining China Securities Daily B026, Hong Kong
2015-045 July.13, 2015 http://www.cninfo.com.cn
company's share price stability Commercial Daily A6
Public Notice on Trade Resumption China Securities Daily B026, Hong Kong
2015-046 July.13, 2015 http://www.cninfo.com.cn
Brought by Significant Event Commercial Daily A6
The announcement of The stock trading China Securities Daily B029, Hong Kong
2015-047 July.16, 2015 http://www.cninfo.com.cn
abnormal fluctuation Commercial Daily A7
Public Notice on Progress of Purchasing
the Equity of China Securities Daily B027, Hong Kong
2015-048 July.29, 2015 http://www.cninfo.com.cn
Changzhou Jingxue Freezing Commercial Daily A11
Equipment Co., Ltd.
Public Notice on Progress of Purchasing
the Equity of China Securities Daily B002, Hong Kong
2015-049 July.31, 2015 http://www.cninfo.com.cn
Dalian Sanyo High-Efficient Commercial Daily A9
Refrigeration System Co., Ltd.
Receipt Notice of CSRC’s Application China Securities Daily B002, Hong Kong
2015-050 Aug.1, 2015 http://www.cninfo.com.cn
for Administrative Licensing Commercial Daily A9
Dalian Refrigeration Co., Ltd. China Securities Daily B032, Hong Kong
2015-051 Aug.21, 2015 http://www.cninfo.com.cn
2015 Semiannual Report Summary Commercial Daily A7
Announcement of the resolutions at the China Securities Daily B032, Hong Kong
2015-052 Aug.21, 2015 http://www.cninfo.com.cn
20th meeting of the 6th Board of Commercial Daily A7
27
Dalian Refrigeration Co., Ltd. 2015Annual Report
Directors
Public Notice on Related Transaction of
Equity Transfer of China Securities Daily B032, Hong Kong
2015-053 Aug.21, 2015 http://www.cninfo.com.cn
Bingshan Technical Service (Dalian) Commercial Daily A7
Co., Ltd.
Public Notice on Progress of Purchasing
the Equity of China Securities Daily B002, Hong Kong
2015-054 Sep.10,2015 http://www.cninfo.com.cn
Wuhan New World Commercial Daily A23
Refrigeration Industrial Co., Ltd.
Public Notice on Progress of Purchasing
the Equity of China Securities Daily B003, Hong Kong
2015-055 Sep.22,2015 http://www.cninfo.com.cn
Bingshan Technical Service (Dalian) Commercial Daily A3
Co., Ltd.
Dalian Refrigeration Co., Ltd.
China Securities Daily B029, Hong Kong
2015-056 QUARTERLY REPORT FOR THIRD Oct.22,2015 http://www.cninfo.com.cn
Commercial Daily A22
QUARTER, 2015
Announcement of the resolutions at the
China Securities Daily B029, Hong Kong
2015-057 21st meeting of the 6th Board of Oct.22,2015 http://www.cninfo.com.cn
Commercial Daily A22
Directors
Public Notice on Related Transaction of
Financial Assistance Provided by China Securities Daily B029, Hong Kong
2015-058 Oct.22,2015 http://www.cninfo.com.cn
Controlling Shareholder to Subsidiary Commercial Daily A22
of the Company
Public Notice on Reply of the Feedback
China Securities Daily B003, Hong Kong
2015-059 for Non-Public Issuance of Stocks Nov.11,2015 http://www.cninfo.com.cn
Commercial Daily A13
Application
Public Notice on Feedback for
China Securities Daily B003, Hong Kong
2015-060 Non-Public Issuance of Stocks Nov.11,2015 http://www.cninfo.com.cn
Commercial Daily A13
Application
Public Notice on Passing the
Examination of Issuance Examination China Securities Daily A12, Hong Kong
2015-061 Dec.3,2015 http://www.cninfo.com.cn
Committee of CSRC to Application for Commercial Daily A20
Non-Public Issuance of A Stocks
Public Notice on the controlling China Securities Daily B003, Hong Kong
2015-062 Dec.24,2015 http://www.cninfo.com.cn
shareholder equity changes Commercial Daily A18
28
Dalian Refrigeration Co., Ltd. 2015Annual Report
Section 6 Change in Share Capital and Shareholders' Information
I. Change in share capital
1. Change in share capital
Shares Shares
（before change） Changes （after change）
items
number proportion number proportion
I. Non-circulating share capital with restricted trade
19,224,451 5.50% 10,150,000 29,374,451 8.16%
conditions
3. Other domestic shares 19,224,451 5.50% 10,150,000 29,374,451 8.16%
Including: Shares held by domestic legal person 19,213,921 5.49% 19,213,921 5.33%
Including: Shares held by domestic natural person 10,530 0.01% 10,150,000 10,160,530 2.82%
II. Circulating share capital 330,790,524 94.50% 330,790,524 91.84%
1. Domestically listed ordinary shares 215,790,524 61.64% 215,790,524 59.91%
2. Domestically listed foreign shares 115,000,000 32.86% 115,000,000 31.93%
III. Total shares 350,014,975 100.00% 10,150,000 360,164,975 100.00%
The reason for the Change in share capital
The Company launched the first phase of restricted stock incentive plan，award the 41 equity incentive objects
with restricted shares amounting to 10,150,000 shares.
The approved of the Change in share capital
√ Applicable □ Not applicable
On December 2014, The Company launched the first phase of restricted stock incentive plan, intend to grant10,
150 thousand shares restricted stock to the41 incentive object. On January, 2015, the CSRC conformed and
recorded without objection to the restricted stock incentive plan draft, On February, 2015, the 1st Extraordinary
Shareholders’ General Meeting of 2015 of the Company examined and adopted the restricted stock incentive plan
draft of the Company and its summary; On March 2015 the Board has implemented and completed granting the
restricted stock.
2.The restricted shares changes
□ Applicable √ Not applicable
II. Securities issuance and listing
1. Securities issuance in the report period
□ Applicable √ Not applicable
2. Change in total shares of the Company and structure of shareholders
The Company launched the first phase of restricted stock incentive plan，award the 41 equity incentive objects
with restricted shares amounting to 10,150,000 shares. The total equity of the Company was changed from
350,014,975 shares to 360,164,975 shares.
3. Internal staff shares
□ Applicable √ Not applicable
III. Shareholders and actual controller
1. Number of shareholders and their shareholding
29
Dalian Refrigeration Co., Ltd. 2015Annual Report
Total number of shareholders in the Total number of shareholders as of the last month before
31,566 33,200
reporting period disclosure of the annual report
Shareholding of top ten shareholders
Number of Number of
Proporti shares with pledged
Name Nature Total number
on sale shares or
restriction shares frozen
Domestic non-state-owned
Dalian Bingshan Group Co., Ltd. 21.34% 76,855,683 19,213,921 0
legal person
Sanyo Electric Co., Ltd. Overseas legal person 9.72% 35,001,500 0 0
National Social Security Fund 107 Portfolio Others 3.04% 10,946,061 0 0
Lion flexible configuration hybrid securities
Others 1.39% 5,000,000 0 0
investment fund
Vanguard harmony growth hybrid securities in
Others 1.11% 3,988,558 0 0
vestment fund
China industry selected hybrid securities
Others 1.07% 3,862,484 0 0
investment fund
Lin Zhenming Overseas natural person 0.75% 2,700,000 0 0
Upthrow morgan manufacturing excellence equity
Others 0.68% 2,464,869 0 0
investment funds
Sun Huiming Domestic natural person 0.68% 2,458,966 0 0
Jiang Youchang Domestic natural person 0.67% 2,417,328 0 0
Shareholding of top ten shareholders without sale restriction
Number of shares
Name without sale Type of shares
restriction
Dalian Bingshan Group Co., Ltd. 57,641,762 RMB denominated ordinary shares
Sanyo Electric Co., Ltd. 35,001,500 Domestically listed foreign shares
National Social Security Fund 107 Portfolio 10,946,061 RMB denominated ordinary shares
Lion flexible configuration hybrid securities investment fund 5,000,000 RMB denominated ordinary shares
Vanguard harmony growth hybrid securities investment fund 3,988,558 RMB denominated ordinary shares
China industry selected hybrid securities investment fund 3,862,484 RMB denominated ordinary shares
Lin Zhenming 2,700,000 Domestically listed foreign shares
Upthrow morgan manufacturing excellence equity investment funds 2,464,869 RMB denominated ordinary shares
Sun Huiming 2,458,966 Domestically listed foreign shares
Jiang Youchang 2,417,328 RMB denominated ordinary shares
Dalian Bingshan Group Co., Ltd. had the association
Notes to the associated relationship and uniform actions of the relationship with Sanyo Electric Co., Ltd. among the above
above shareholders shareholders. Sanyo Electric Co., Ltd. holds 26.6% of Dalian
Bingshan Group Co., Ltd.'s equity.
30
Dalian Refrigeration Co., Ltd. 2015Annual Report
2.Contralling shareholder of the Company
Legal Founding Unified social
Name of holding shareholder Main business
representative date credit code
Research, development, manufacture, sales,
service and installation of industrial refrigeration
products, freezing and cold storage products,
Motoma 91210200241 large-, medium- and small-size air-conditioning
Dalian Bingshan Group Co., Ltd. Jul. 3, 1985
Zhero 2917931 products, petrochemical equipment products,
electronic and electric control products, home
appliance products and environment protection
products.
Shares held by the holding
shareholder in other overseas and
domestic listed companies as the None
holding shareholder or ordinary
shareholder in the reporting period
Change in the holding shareholder in the reporting period
□ Applicable √ Not applicable
3. Actual controller of the Company
The company has no actual controllers
According to the actual situation of Dalian Refrigeration Co., Ltd. and its controlling shareholders, and compared
with the related laws and regulations including Company Law of People’s Republic of China, Management
Regulation on Listing Company Acquisition and Stock Listing Rules of Shenzhen Stock Exchange, with the
confirmation of Liaoning Huaxia law firm, the Company released the Public Notice on Not Having Actual
Controller.(No: 2015-025),) which was published on B04 of China Securities, A19 of HK Commercial Daily and
Cninfo website on April 24 2015.
Commission of Dalian Municipality Government
State-owned Assets Supervision and Administration
Dalian State-owned Assets Management Co., Ltd.
Dalian Equipment Manufacture Investment
Dalan Zhonghuida Refrigeration
Sanyo Electric Co., Ltd.
Yida Group Co., Ltd.
Dayang Co., Ltd.
Technology Co., Ltd.
Co., Ltd.
100% 100%
22.2% 4.4% 13.3% 13.3% 20.2% 26.6%
Dalian Bingshan Group Co., Ltd.
21.34%
Dalian Refrigeration Co., Ltd.
31
Dalian Refrigeration Co., Ltd. 2015Annual Report
The actual controller controlled the Company through a trust or other asset management
□ Applicable √ Not applicable
4. Other legal-person shareholders holding of 10% or more shares
□ Applicable √ Not applicable
5.、controlling shareholders, actual controllers, restructuring the constraint to the stake and other
commitments underweight
□ Applicable √ Not applicable
32
Dalian Refrigeration Co., Ltd. 2015Annual Report
Section 7 Information on Preferred Stock
□ Applicable √ Not applicable
In the reporting period, the Company didn’t own preferred stock.
33
Dalian Refrigeration Co., Ltd. 2015Annual Report
Section 8 Information on the Company’s Directors, Supervisors,
Senior Management and Staff
I. Changes in shareholding by directors, supervisors and senior managers
Increase Decrease
Shares Shares
on holding in holding
Starting Ending held at held at
Office-holdi of shares of shares
Name Position Sex Age date of date of beginning the end of
ng state in this in this
office term office term of period period
period period
(shares) (shares)
(shares) (share)
Mar. 27, Jan.22,
Ji Zhijian Chairman Incumbent M 48 942,300 942,300
2014 2019
Mar. 27, Jan.22,
Xu Junrao Director Incumbent F 52 3,900 659,600 0 663,500
2014 2019
Feb. 5, Jan.22,
Liu Kai Director, GM Incumbent M 41 659,600 659,600
2013 2019
Wang Feb. 5, Jan.22,
Director, DGM Incumbent M 53 376,900 376,900
Zhiqiang 2013 2019
Kobayashi Mar. 27, Jan.21
Vice Chairman Incumbent M 54
Noriaki 2014 2016
Kijima Mar. 27, Jan.22,
Director Incumbent M 58
Tadatoshi 2014 2019
Dai Independent Feb.13, Jan.22,
Incumbent F 64
Dashuang director 2015 2019
Independent Feb.13, Jan.22,
Liu Jiwei Incumbent M 54
director 2015 2019
Independent May.20 Jan.22,
Wang Yan Incumbent F 52
director 2015 2019
Chairman of
Feb. 5, Jan.22,
Yu Fuchun Board of Incumbent M 56 10,140 0 0 10,140
2013 2019
Supervisors
Mao Feb. 5, Jan.22,
Supervisor Incumbent F 50
Chunhua 2013 2019
Feb. 5, Jan.22,
Ma Yun Supervisor Incumbent M 44
2013 2019
Fan Otc.22. Jan.22,
DGM Incumbent M 51
Yuekun 2015 2019
Chief Financial Feb. 5, Jan21,
Rong Yan Incumbent F 46 376,900 376,900
Officer 2013 2016
Li Dec. 12, Jan21,
DGM Incumbent M 49 376,900 376,900
Wenjiang 2013 2016
34
Dalian Refrigeration Co., Ltd. 2015Annual Report
Song Feb. 5, Jan.22,
Board secretary Incumbent M 42 282,800 282,800
Wenbao 2013 2019
Liu Independent Leaving Feb. 5, May 19,
F 60
Caiping director office 2013 2015
Wang Independent Leaving Feb. 5, Feb12,
M 71
Huiquan director office 2013 2015
Xing Independent Leaving Feb. 5, Feb12,
M 54
Tiancai director office 2013 2015
Total -- -- -- -- -- -- 14,040 3,675,000 0 3,689,040
II. Changes of directors, supervisors, senior managers of company
Name Position held Type Date Reason
Independent
Wang Huiquan Leaving office Feb. 12, 2015 Resigned according to the relevant requirement
director
Independent
Xing Tiancai Leaving office Feb. 12, 2015 Resigned according to the relevant requirement
director
Leaving office when
Independent
Liu Caiping expiration of the term of May 20, 2015 expiration of the term of office
director
office
Fan Yuekun DGM Be employed Oct 22, 2015 Employed by the Company
Independent
Dai Dashuang Be elected Feb. 12, 2015 The general meeting of shareholders by election
director
Independent
Liu Jiwei Be elected Feb. 12, 2015 The general meeting of shareholders by election
director
Independent
Wang Yan Be elected May 20, 2015 The general meeting of shareholders to election
director
On Juanary 21,2016 the Company held the 1st Extraordinary Shareholders’ General Meeting of 2016 , to carry
out the management changing work, The meeting elected Ji Zhijian, Liu Kai ,Xu Junrao,Ding Jie , Kudou sinn and
Kijima Tadatoshi to be the directors of the Company. Elected Dai Dashuang,Liu Jiwei, Wang Yan to be the
independent directors of the Company. Elected Yu Fuchun, Mao Chunhua ,Dai Yuling to be the supervisors of the
Company.
On Juanary 21,2016 the Company held the 1st meeting of the 7th Board of Directors，The meeting elected Ji
Zhijian as the Chairman of the Board,engaged Fan Yuekun and Wang Zhiqiang as the Deputy General Manager of
the Company,engaged Ma Yun as the Chief Financial Officer of the Company, engaged Song Wenbao as the as
Secretary of the Board of the Company.
III.Office holding
Professional background ,main work experiences and the main duties and responsibilities of incumbent directors,
supervisors, senior managers of the company.
35
Dalian Refrigeration Co., Ltd. 2015Annual Report
main duties and
Name Position held Professional background Main work experience
responsibilities
doctorate degree in Successively acting as director, GM, Chairman of D Panasonic Related
Ji Zhijian Chairman management of the Dalian Cold-Chain.; President of Dalian Bingshan Group Co., Ltd.; responsibilities of
University of Technology Chairman of the Company. the Chairman
Successively acting as the Financial Majordomo, director of the Related
The MBA and senior
Xu Junrao Director company; Vice President and chief accountant of Dalian Bingshan responsibilities of
account
Group Co., Ltd. the Director
graduate from Xi’an
Jiaotong University major
Related
Director, in mechanical designing Successively acting as Head of Production Management Dept.,
Liu Kai responsibilities of
GM and manufacturing and the Assistant GM, GM and director of the company.
the Director
MBA of Dalian University
of Technology
graduate from Dalian Related
Wang Director, Successively acting as DGM, Chief Engineer, and director of the
University of responsibilities of
Zhiqiang DGM company.
Technology,Master Degree the Director
Successively acting as chief of financial dept. in Consumer Product Related
Kobayashi Vice graduated from Tsuyama
Marketing Division of the company and councilor in Global responsibilities of
Noriaki Chairman University;
Consumer Marketing Division of the company the Vice Chairman
Successively acting as manager of home electrochemical operation
Related
Kijima graduated from Osaka planning division, the electrochemical residential equipment branch
Director responsibilities of
Tadatoshi Prefecture University; of the company and Executive GM of Hangzhou Panasonic
the Director
Household Appliances Co., Ltd.
professor, international
She serves as professor and doctoral tutor of the school of business Related
project management
Dai Independent administration of Dalian university of Technology, the director of responsibilities of
appraiser, Chinese
Dashuang director project management research center of Dalian university of the Independent
registered consulting
technology. director
engineer.
Related
doctor of management, He has served successively as the director of finance department,
Independent responsibilities of
Liu Jiwei professor of accounting, professor of the accountancy of Dongbei University of Finance and
director the Independent
CPA. Economics,
director
She has served successively as vice dean of law school of Dongbei
graduate from China Related
University of Finance and Economics, the director of Chinese society
Independent University of Political responsibilities of
Wang Yan of Economic Law ,the president of the Economics law seminar of
director Science and Law， the Independent
Liaoning Province law society, and the arbitrator of Dalian Arbitration
professor of law director
Commission
Chairman of Related
He has served successively as the vice chairman of the Trade Union
Yu Fuchun Board of the senior political worker, responsibilities of
of the Company
Supervisors the Supervisor
36
Dalian Refrigeration Co., Ltd. 2015Annual Report
Related
Mao Successively acting as Vice Head, and Head of the Financial Dept. of
Supervisor Senior Accountant responsibilities of
Chunhua the company.
the Supervisor
He has served successively as the Deputy chief of the Financial
Related
Management Dept. of the Company, the supervisor of the Company,
Ma Yun Supervisor The Accountant responsibilities of
and the Chief Financial Officer of Dalian Bingshan Group Sales Co.,
the Supervisor
Ltd.
he successively served as the general manager of operation &
graduated from Tsinghua
management division and GM assistant of Panasonic Cold-Chain
University with a bachelor
from 2003 to 2013; served as GM of Dalian HURLLY Group Co.,
Fan degree, major in
DGM Ltd. from June 2013 to July 2015; served as the general manager of Assist the GM
Yuekun engineering physics, and
operation & management division of the Company since September
MBA of Dalian University
2015. serves as the Deputy General Manager of the Company since
of Technology;
October 22, 2015.
Successively acting as Head of Financial Management Dept.,
Responsible for
Rong Yan CFO Senior Accountant Operation Planning Head of Panasonic Refrigeration., and Director,
the financial work
Financial Majordomo of the Company.
Responsible for
Li graduate from Xi’an Successively acting as Head of Package Design Dept., Vice Chief
DGM technical
Wenjiang Jiaotong University Engineer, and DGM of the company.
marketing work
Related
Song Board graduate from Zhejiang Successively acting as representative for securities affairs, board
responsibilities of
Wenbao secretary University，CFA secretary of the company.
Board secretary
Office holding in shareholder unit
√ Applicable □ Not applicable
If receiving remuneration or allowance from
Name of office holder Shareholder unit name Position held in shareholder unit
shareholder unit
Ji Zhijian Dalian Bingshan Group Co., Ltd. The President Yes
Xu Junrao Dalian Bingshan Group Co., Ltd. Vice President and chief accountant Yes
Office holding in other units
√ Applicable □ Not applicable
If receiving
remuneration or
name unit name Position held in other unit
allowance from other
unit
Panasonic Refrigeration (Dalian) Co., Ltd.; Chairman no
Panasonic Cold-chain (Dalian) Co., Ltd Chairman no
Dalian Fuji-Bingshan Vending Machine Co., Ltd. Chairman no
Ji Zhijian Bingshan Technology Service (Dalian) Co., Ltd. Chairman no
Mitsubishi-Bingshan Refrigeration (Dalian) Co., Ltd. Chairman no
Wuhan New World Refrigeration Industrial Co., Ltd.; Chairman no
Dalian Zhong Huida Refrigeration technology Co., Ltd. Chairman no
Liu Kai Dalian Bingshan Group Sales Co., Ltd. Chairman no
37
Dalian Refrigeration Co., Ltd. 2015Annual Report
Dalian Bingshan Group Refrigeration Installation Co., Ltd.; Chairman no
Dalian Thermal Power Co., Ltd The independent yes
Dai Dashuang
Yingkou Port Liability Co., Ltd The independent yes
GF Securities Co., Ltd The independent yes
Li Wenjiang
Lingyuan Iron and Steel Co., Ltd The independent yes
Wang Yan Dalian international cooperation (group) Co., Ltd The independent yes
IV.Remuneration paid to directors, supervisors, and senior management
Decision-making procedure, decision-making basis and actual payment of remuneration for directors, supervisors
and senior management
Decision-making procedure: the Company's remuneration plan for directors and supervisors was proposed by the
Company's Remuneration and Evaluation Committee of the Board of Directors, and after approval by the Board
of Directors, submitted to the general meeting for adoption and put into effect. The Company's remuneration plan
for senior management was put into effect after approval by the Company's Board of Directors.
Decision-making basis: it was decided on the basis of main responsibilities and importance of the concerned
position and the remuneration level of similar positions in other similar enterprises and evaluated and rewarded
through the Company's examination procedure for assets operation performance.
The total amount of remunerations actually ( pre-tax ) paid by the Company to directors, supervisors, and senior
management was 3.7538 million yuan.
Particulars about the annual remuneration of directors, supervisors and senior staff members
Annual remuneration and allowance( pre-tax )paid by the Company
Name
(ten thousand yuan)
Ji Zhijian 0
Xu Junrao 0
Liu Kai 67.99
Wang Zhiqiang 53.30
Kobayashi Noriaki 0
Kijima Tadatoshi 0
Dai Dashuang 8.00
Li Wenjiang 8.00
Wang Yan 8.00
Yu Fuchun 14.85
Mao Chunhua 18.67
Ma Yun 28.00
Fan Yuekun 22.77
Rong Yan 53.30
Li Wenjiang 53.30
Song Wenbao 39.20
Total 375.38
Equity incentive plans granted to directors, supervisors and senior management of the Company in the reporting
period
√ Applicable □ Not applicable
38
Dalian Refrigeration Co., Ltd. 2015Annual Report
Granted
Held the restricted stock New granted restricted Held the restricted
Unlocked shares price
name position quantity at the stock during the stock quantity at the
during the period （yuan/sh
beginning of the period period end of the period
are）
Ji Zhijian Chairman 0 0 942,300 5.56 942,300
Xu Junrao Director 0 0 659,600 5.56 659,600
Liu Kai Director, GM 0 0 659,600 5.56 659,600
Director,
Wang Zhiqiang 0 0 376,900 5.56 376,900
DGM
Rong Yan CFO 0 0 376,900 5.56 376,900
Li Wenjiang DGM 0 0 376,900 5.56 376,900
Board
Song Wenbao 0 0 282,800 5.56 282,800
secretary
total -- 0 0 3,675,000 -- 3,675,000
V. Status of the Company's staff
1. As of Dec. 31, 2015 the Company and its major subsidiary had 1,872 enrolled employees, including 1,045
persons engaged in production, accounting for 56%; 265 persons engaged in engineering and technology,
accounting for 14%; 270 persons engaged in marketing, accounting for14%; and 292 persons engaged in
management, accounting for 16%.
2. As of Dec. 31, 2015,, among enrolled employees of the Company and its major subsidiary, 56persons have the
educational background of Master or higher, accounting for 3%; 505 persons have the educational background of
university, accounting for 27%; 562 persons have the educational background of junior college, accounting for
30%; and749 persons have the educational background of secondary technical school or lower, accounting for
40%.
3. The Company applied the employee job performance wage system with distribution according to positions and
performance of an employee.
4. The Company formulated the annual training plan and gave purposeful training to an employee in consideration
of his/her post requirement.
5. The pension and medical expense for retired employees of the Company were paid by the social insurance
body.
39
Dalian Refrigeration Co., Ltd. 2015Annual Report
Section 9 Corporate Governance
I. Basic situation of corporate governance
Within the reporting period, the company centered around the operation subject as “Leading innovation, Creating
value” to further deepen and perfect the normative internal control system and upgrade the governing level of the
company continuously.
There were no problems with the Company concerning horizontal competition caused by restructures and other
reasons. The main normal associated transactions between the Company and the associated companies included
purchasing the supporting products for package projects from the associated companies, and selling the supporting
parts and components to the associated companies and providing them with the labor service. Associated
transactions between the Company and the associated companies are necessary for normal production and
operation and helpful for the Company’s healthy development, and therefore will continue. The Company will
strictly follow the related decision-making procedures and fulfill the obligation in information disclosure in order
to further regulate associated transactions.
Was there any deviation of the Company's corporate governance from the requirements in the Company Law and
China Securities Regulatory Commission's regulations?
□ Yes √ No
There was no deviation of the Company's corporate governance from the requirements in the Company Law and
China Securities Regulatory Commission's regulations.
II. Status of the Company's business, staff, asset, organization and finance separations from
the holding shareholder
The Company was separated from the holding shareholder in business, staff, asset, organization and finance, and
has the independent and complete business and operation capability.
III. Horizontal competitions
□ Applicable √ Not applicable
IV Shareholders’ general meeting convened in the reporting period
1. Annual Shareholders’ general meeting within this reporting period
The proportion of Disclosing Disclosing
Session number of meeting The type of the meeting date
participate investors date index
st
The 1 Extraordinary Shareholders’ extraordinary Shareholders’ Jan http://www.c
1.34% Jan 22,2015
General Meeting of 2015 general meeting 21,2015 ninfo.com.cn
2014 Annual Shareholders’ May May http://www.c
0.33%
Annual Shareholders’General Meeting General Meeting 20,2015 21,2015 ninfo.com.cn
The 2st Extraordinary Shareholders’ extraordinary Shareholders’ Jun http://www.c
0.13% Jun 25,2015
General Meeting of 2015 general meetin 24,2015 ninfo.com.cn
V. Independent directors’ execution of duties in the reporting period
1. Attendance of independent directors to the meetings of the Board of Directors and general meetings
40
Dalian Refrigeration Co., Ltd. 2015Annual Report
Attendance of independent directors to the meetings of the Board of Directors
Number of Failure to
Number of
Name of due board Number of Number of attend in
attendance by Number of
independent meetings in attendances on attendance by person for
communicatio absences
director the reporting the spot proxy successive two
n
period times or not
Dai Dashuang 7 4 3 0 0 No
Li Wenjiang 7 4 3 0 0 No
Wang Yan 5 3 2 0 0 No
Number of attendances as a
3
non-voting delegate
2. Objections to the related matters of the Company raised by independent directors
The independent directors have raised no objections to the related matters of the Company in the reporting period.
3. Other description of independent directors’ execution of duties
For details of the Company's independent directors' execution of duties, see the 2015 annual work report of the
independent directors of the Company.
VI.. Execution of duties of the special committees under the Board of Directors in the
reporting period
1. Execution of duties of the audit committee under the Board of Directors
With performance of its duty according to the Implementation Rules for the Audit Commission under the Board of
Directors and the Annual Reporting Work Rules for the Audit Commission, the Audit Commission under the
Board of Directors supervised the Company’s internal audit system and its implementation, audited the
Company’s accounting information and its disclosure and assessed the work of the external audit institution.
In the work of evaluation of a normative internal control system of the company, the Auditing Commission
brought into play actively the duty of organization, leadership and supervision. According to the company internal
control defect recognization standard, it examined and recognized the internal control defect recognization
summary table developed by the internal control evaluation work group of the company, and had an examination
reading of the internal control evaluation report of the company for 2015, believing that the status quo of the
internal control system of the company complies with related requirements and with the actual situation of the
company and it is being carried out satisfactorily. The internal control evaluation report of the company for 2015
reflects the above facts accurately.
In the Company’s 2015 annual audit work, the Audit Commission conducted positive communication and
effective coordination with the audit institution Da Hua Certified Public Accountants. The Audit Commission
conducted communication with the person in charge of the project of the audit institution on the audit work plan,
schedule, matters that should be noticed in audit and other matters and reached an agreement with them. In the
process of audit, they kept close information on the progress of audit work and urged the audit institution many
times to ensure the quality and schedule in the audit work. Through serious review of the Company’s annual
finance report and annual report after completion of the audit work, the Audit Commission believed that the
Company’s finance report was comprehensive and authentic, and the finance report and other information
disclosed by the Company were objective and true, having reflected the true annual financial status of the
Company.
The Audit Commission believed that in the 2015 annual audit service for the Company, Da Hua Certified Public
Accountants implemented the audit for the Company on the practicing basis of independency, objectivity and
fairness and strictly abided by the new accounting standards. They worked out a well-considered plan, allocated
all necessary personnel, positively contacted our Audit Commission and independent directors, and completed the
2015 annual audit service for the Company through its industrious and conscientious working. It is suggested that
Da Hua Certified Public Accountants should be reengaged as the auditing agency for the company in 2016.
41
Dalian Refrigeration Co., Ltd. 2015Annual Report
2. Execution of duties of the remuneration and evaluation committee under the Board of Directors
With performance of its duty according to the Implementation Rules for the Remuneration and Evaluation
Commission under the Board of Directors, the Remuneration and Evaluation Commission under the Board of
Directors examined the annual salary and remuneration level of the Company’s directors, supervisors and senior
executives, and believed that the decision-making procedure for salary and remuneration of the above persons and
the paying standard complied with the laws and regulations and the Company’s regulations, and the salary and
remuneration information disclosed in the Company’s Annual Report for 2015was authentic and exact.
VII. Work of the Board of Supervisors
Was there any risk with the Company found by the Board of Supervisors in their supervision activities in the
reporting period?
□ Applicable √ Not applicable
The Board of Supervisors had no objections to the matters under supervision in the reporting period.
VIII. Performance evaluation and incentive system for senior management
The Company evaluated and rewarded senior management through the Company's examination procedure for
assets operation performance in the reporting period.
IX.the internal control system
1.Details of material weakness in the internal control found in the reporting period described in the report
on self-evaluation of internal control.
□ Applicable √ Not applicable
There was no material weakness in the internal control found in the reporting period.
2. Report on self-evaluation of internal control
Details of material weakness in the internal control found in the reporting period described in the report on
self-evaluation of internal control
There was no material weakness in the internal control found in the reporting period.
Date of disclosing the full text of the report on
Mar. 30, 2016
self-evaluation of internal control
Disclosure reference to the full text of the For the 2015 annual report on self-evaluation of internal control
report on self-evaluation of internal control of the Company, visit the website www.cninfo.com.cn.
3. Internal control audit report
Description of the deliberation opinions in the internal control audit report
We think that as of Dec. 31, 2015, Dalian Refrigeration Co., Ltd. had maintained an effective internal control
over the financial reports in all material aspects according to Basic Enterprise Internal Control Specification and
relevant regulations.
Date of disclosing the full text of
Mar. 30, 2016
the internal control audit report
Disclosure reference to the full text For the 2015 annual internal control audit report of the Company, visit the
of the internal control audit report website www.cninfo.com.cn.
Did the accounting firm issue the internal control audit report with nonstandard opinions?
□ Applicable √ Not applicable
Was the internal control audit report issued by the accounting firm consistent with the opinion in the
self-evaluation report of the Board of Directors?
√Yes □ No
42
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Section 10 Financial Report
I. Auditor’s Report
DHS(2016) No.003393
To the Board of Directors of Dalian Refrigeration Company Limited：
We have audited the consolidated and the parent company’s financial statements of Dalian Refrigeration
Company Limited, which comprise the Balance Sheet as at 31 December 2015, and the Income Statement, Cash
Flow Statement and Statement of Changes in Owner’s Equity for the year then ended, and the notes to the
financial statements.
1.The responsibility of the Company’s management
It is the responsibility of Dalian Refrigeration Company Limited’s management to prepare and present the
financial statements fairly. And the responsibilities include: (1) Prepare the financial statements in conformity
with Accounting Standards for Business Enterprises issued by Ministry of Finance, and to be presented fairly. (2)
Design, conduct and maintain the internal control related to the financial statements to prevent the big material
misstatement with the reason of fraud and mistakes.
2.Auditors’ responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our
audit in accordance with the Auditing Standards for Chinese Certified Public Accountants. Those standards
require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement.
An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial
statement. The selected audit procedure depended on the judgment of CPA includes identify the risks of the
material misstatements due to the fraud and mistakes. In evaluating the risks, we are only concerned with the
internal control systems so as to design an appropriate audit procedure, but not to express our opinion on the
effectiveness of the internal control systems. An audit also includes assessing the accounting principles used and
significant estimates made by the management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
3.Auditing opinion
In our opinion, the financial statements are prepared in conformity with Accounting Standards for Business
Enterprises and, in all material respects, present fairly the consolidated and the parent company’s financial
position of Dalian Refrigeration Company Limited as at 31 December 2015, and the results of operations and
cash flow for the year then ended.
Da Hua Certified Public Accountants
Chinese CPA: Sui Guojun
（Special General Partnership）
Beijing, China Chinese CPA: Wang ShuhuanChina Dalian,
China Chinese CPA :
29 March, 2016
43
Dalian Refrigeration Co., Ltd. 2015 Annual Report
II. Accounting statement (attached hereunder)
For details see page 123-page132
III. Notes to the accounting statement
(All amounts in RMB Yuan unless otherwise stated)
I.General information
Dalian Refrigeration Company Limited (the “Company”) was reorganized from main part of former
Dalian Refrigeration Factory ,and incorporated in the People’s Republic of China (the “PRC”) on
December 18, 1993 as a joint stock limited company. The Company’s domestically listed RMB
denominated ordinary shares (“A shares”) and domestically listed foreign investment ordinary
shares (“B shares”) were listed on the Shenzhen Stock Exchange in the PRC in December 1993 and
March 1998 respectively. The Company together with its subsidiaries is hereinafter collectively
referred to as the “Group”. As at 31 December, 2015, the registered capital of the Company was
RMB360,164,975.00. The address of the Company’s registered office is No.888 Xinan Road,
Shahekou District, Dalian, China.The parent company of the Company is Dalian Bingshan Group
Co., Ltd., and there is no ultimate controller.
According to the report on granting the restricted stock to the incentive object deliberated by the
15th Meeting of 6th Session of the Board of Directors of the Company, and the restricted stock plan
draft of the Company, the Board has implemented and completed granting the restricted stock. After
the completion of granting the restricted stock, the total share capital of the Company will increase
to 360,164,975 shares from the original 350,014,975 shares.
The principal activities of the Company are manufacture, sale and installation of refrigeration
equipments.
The financial statements was permitted to disclose by the board of directors of the Company on 29
March, 2016.
II. The scope of consolidation
There are 9 entities included in the current consolidated financial statements, including:
Proportion of Proportion of
Names of subsidiaries Types Level
shareholding（%） votes（%）
Dalian Bingshan Group Engineering Co.,
Fully owned 1 100 100
Ltd.
Dalian Bingshan Group Sales Co., Ltd. Fully owned 1 100 100
Dalian Bingshan Air-conditioning Equipment Holding subsidiary
1 70 70
Co., Ltd.
Dalian Bingshan Metal Processing Co., Ltd. Fully owned 1 100 100
Dalian Bingshan Guardian Automation Co., Holding subsidiary
1 60 60
Ltd.
Dalian Bingshan Ryosetsu Quick Freezing Holding subsidiary
1 70 70
Equipment Co., Ltd.
Wuhan New World Refrigeration Industrial
Fully owned 1 100 100
Co., Ltd.
Bingshan Technical Service （ Dalian ）
Fully owned 1 100 100
Co.,Ltd.
Dalian Sanyo High-efficient Refrigeration Holding subsidiary
1 55 55
System Co., Ltd.
Bingshan Technical Service(Dalian)Co.,Ltd. and Dalian Sanyo High-Efficient Refrigeration System
Co., Ltd. were included in the scope of consolidation at the year end.
III . Basic of preparation of financial statements
1. Basic of preparation of financial statements
The financial statements have been prepared on the basic assumption of going concern and on the
accrual basis of accounting. The effects of evens and other transactions actually occurred and they
have been recorded and measured in accordance with the Accounting Standards for Business
Enterprises issued by Ministry of Finance.
44
Dalian Refrigeration Co., Ltd. 2015 Annual Report
2. Going-concern
The company has the capacity to continually operate within 12 months at least since the end of
report period, and hasn‘t the major issues impacting on the sustainable operation ability.
IV.The main accounting policies, accounting estimates and corrections of accounting errors
1. Declaration on following Accounting Standard for Business Enterprises
Declaration from the Company: The financial statements made by the Company was in accordance
with Accounting Standards for Business Enterprises, which reflected the financial position, financial
performance and cash flow of the Company truly, objectively and completely.
2. Fiscal year
The Company adopts the calendar year as its fiscal year, i.e. from January 1 to December 31.
3. Operating Cycle
12 months are regarded as one operating cycle in the company, and which is as the division criterion
for the liquidity of assets and liabilities.
4. Functional currency
RMB was the functional currency of the Company.
5. Accounting method of business combination under the same control and not under the same
control
A. Each transaction items, conditions and economy influence in confirm with the following
one or several conditions, when realizing enterprise combination by steps. Several transaction
events were considered as a package deal and conducted accounting method
(1) The transaction was set up in the same time or had considered the influence to each others:
(2) The transaction only stand as a whole, a perfect commercial result can be arrived.
(3) A transaction incurred depends on at least one transaction occurred;
(4) A transaction is not economical, however, together with other transaction are economical.
B. Business combination under the same control
The assets and liabilities that the combining party obtains in a business combination shall be
measured on the basis of their carrying amount in the combined party (including goodwill formed
from the final control party purchase combined party) combing party on the combining date. As for
the balance between the carrying amount of the net assets obtained by the combining party and the
carrying amount of the consideration paid by it (or the total par value of the shares issued), the
additional paid-in capital shall be adjusted. If the additional paid-in capital is not sufficient to be
offset, the retained earnings shall be adjusted.
In the event that the contingent consideration exists and the accrued liabilities or assets need to be
recognized, the difference between the accrued liabilities or assets and the settlement amount of
subsequent contingent consideration shall adjust the capital surplus (capital premium or stock
premium), and if the capital surplus is not sufficient, adjust the retained earnings.
Where the corporate merger and acquisition is realized through multiple transactions, if these
transactions belong to a package transaction, each transaction shall be accounted as a transaction to
obtain the right to control; if these transactions do not belong to a package transaction, on the date
the right to control is obtained, the difference between the initial investment costs of the long-term
equity investment and the carrying value of long-term equity investment before the M&A plus the
carrying value of the new consideration paid to further get the shares on the date of M&A shall be
charged against the capital surplus, and if the capital surplus is insufficient, the difference shall be
charged against the remaining earnings. For the equity investment held before the date of M&A, the
other comprehensive earnings accounted for using the equity method or recognized with the
financial tool and accounted for and recognized using the measurement criteria shall not be
accounted, until the investment is disposed, at which time, the investment shall be accounted on the
same basis as the investee directly disposes related assets or liabilities; the changes to the owner’s
equity in the investee’s net assets accounted and recognized using the equity method other than the
net profit or losses, other comprehensive earnings and profit distribution, shall not be accounted,
45
Dalian Refrigeration Co., Ltd. 2015 Annual Report
until the investment is disposed, at which time, it shall be carried over to the current profits or
losses.
C. Business combination not under the same control
The Company shall, on the acquisition date, measure the assets given and liabilities incurred or
assumed by an enterprise for a business combination in light of their fair values, and shall record the
balances between them and their carrying amounts into the profits and losses at the current period.
The Company shall recognize the positive balance between the combination costs and the fair value
of the identifiable net assets it obtains from the acquiree as business reputation. The Company shall
record, upon recheck, the negative balance between the combination costs and the fair value of the
identifiable net assets it obtains from the acquiree into the profit and loss of the current period.
Where a merger of enterprises not under the same control is realized through multiple transactions
step by step, if these transactions belong to a package transaction, each transaction shall be
accounted as a transaction to obtain the right to control; if these transactions do not belong to a
package transaction, and the equity investment held before the date of M&A is accounted using the
equity method, the sum of the carrying value of the equity investment in the acquiree held before
the date of the acquisition, plus the new investment costs on the date of the acquisition shall be the
initial investment costs of the investment; other comprehensive earnings of the equity investment
held before the date of acquisition accounted and recognized using the equity method shall be
accounted on the same basis as the investee directly disposes relevant assets or liabilities when the
investment is disposed. If the equity investment held before the date of M&A is recognized using
the financial tool and accounted using the measurement criterion, the sum of the fair value of the
equity investment on the date of M&A plus the new investment costs shall be the initial investment
costs at the date of M&A. The difference between the fair value and carrying value of the held
equity and changes to the accumulated fair value charged against other comprehensive earnings
shall be fully converted the current investment earnings at the date of M&A.
D. Relevant costs incurred from the business combination
The intermediary and other relevant administrative expenses such as audit, legal and valuation
advisory for business combinations are recognized in profit or loss for the current year when
incurred. Transaction costs of equity or debt securities issued as the considerations of business
combination are included in the initial recognition amounts.
6. Basis of consolidation
A. Scope of consolidation
The scope of consolidated financial statements shall be confirmed based on the control. All
subsidiaries (including individual entities controlled by the Company) of the Company shall be
included into the consolidated financial statement.
B. Consolidation process
The Company based on the financial statements of itself and its subsidiaries, in line with other
relevant information, prepare the consolidated financial statements. The consolidated financial
statements the Company prepare was considered the whole enterprise group as a accountant entity,
in line with the requirement of presentation, recognition and calculation in ASBE and a uniform
accountant policies, reflect the financial situation, operation results and cash flows of the whole
enterprise group.
The accounting policies and accounting period adopted by the subsidiaries that are included into the
scope of consolidated financial statement consistent with those the Company adopts. If the
accounting policies and accounting period adopted by a subsidiary are different from those adopted
by the Company, necessary adjustments shall be made to the financial statements under the
accounting policies and accounting period adopted by the Company.
Consolidated financial statement shall be prepared by the parent company after the effects of the
internal transactions between the Company and its subsidiaries and between its subsidiaries
themselves on the consolidated balance sheets, consolidated income statement, consolidated cash
flow and consolidated statement of change in owners’ equity are offset. If standing at the point of
view of enterprise group consolidated financial statement, and its recognition of common trade
differ from the accounting entity of Company or subsidiary, adjust it from the point of view of the
enterprise group.
Minority shareholders’ portions of equities and income in subsidiaries shall be separately stated
respectively under owners’ equity in the consolidated balance sheet and net profit in the
46
Dalian Refrigeration Co., Ltd. 2015 Annual Report
consolidated income statement. For the deficit of current period exceeding the share in the
beginning of owner’s equity, the balance shall offset against the minority shareholder’s equity.
For subsidiary obtained by business combination under same control, adjust the financial statement
on the base of book value of assets, liabilities (including goodwill formed by the financial control
party purchasing the subsidiary) in financial statement of final control party.
For subsidiary obtained by business combination not under same control, adjust the financial
statement on the base of identifiable net assets on purchase date
(1) Increasing the subsidiaries or business
During the reporting period, for the added subsidiary companies for business combination under the
same control, shall adjust the beginning balance of the consolidated balance sheet, and shall involve
the incomes, expenses and profits of the subsidiary companies incurred from the beginning of the
current period to the end of reporting year into consolidated income statement; and shall include the
cash flow of the subsidiary companies from the beginning of the current period to the reporting
period into the consolidated cash flow statement. Meanwhile, relevant items in the statements shall
be compared and adjusted with the reporting subject after the consolidation being regarded to have
always existed since the control party start to control.
Owning to the reasons such as the additional investment, for the subsidiaries could execute control
on the investees under the same control, should be regard as the individuals participated in the
combination that to execute adjustment by existing as the current state when the ultimate control
party began to control. For the equity investment held before acquiring the control right of the
combined parties, the confirmed relevant gains and losses, other comprehensive income and the
changes of other net assets since the date of the earlier one between the date when acquiring the
original equity right and the date when the combine parties and combined ones were under the same
control to the combination date, should be respectively written down and compared with the
beginning balance of retained earnings or the current gains and losses during the statement period.
During the reporting period, for the added subsidiary companies for business combination note
under the same control, shall adjust the beginning balance of the consolidated balance sheet, and
shall involve the incomes, expenses and profits of the subsidiary companies incurred from purchase
date to the end of reporting year into consolidated income statement; and shall include the cash flow
of the subsidiary companies from purchase date to the reporting period into the consolidated cash
flow statement.
Owning to the reasons such as the additional investment that the subsidiaries could execute the
control of the investees under different control, the Company shall re-measure the equity interests in
the acquiree held by it before the acquisition date according to the equity interests’ fair value on the
acquisition date. And the difference between the fair value and the book value is recorded into
current investment gains. Where the equity interests in the acquiree held by the Company which
involved with the other comprehensive profits and changes of the other owners’ equities except for
the net gains and losses, other comprehensive profits as well as the profits distribution under the
measurement of equity method before the acquisition date involves other comprehensive incomes,
the relevant other comprehensive incomes and the changes of the other owners’ equities are restated
as investment gains for the period which the acquisition date belongs to, with the exception of the
other comprehensive incomes occurred because of the changes of net liabilities or net assets of the
defined benefit pension plans be re-measured for setting by the investees.
(2) Disposal of the subsidiaries or business
1) General disposing method
The consolidated cash flow statement shall include the cash flow from the beginning of the current
period to the settlement date.
Where the Company loses the control over a former subsidiary due to disposal of some equity
investments or other reasons, the Company re-measures the remaining equity investments after the
disposal according to the fair value on the date when the control ceases. The consideration obtained
in the equity disposal, plus the fair value of the remaining equities, less the Company’s share of net
assets in the former subsidiary calculated from the acquisition date according to the former
shareholding ratio, is recorded into the investment gains for the period when the control ceases.
Other comprehensive incomes in relation to the equity investments in the former subsidiary are
restated as investment gains for the period when the control ceases. Where the equity interests in the
subsidiary held by the Company which involved with the other comprehensive profits and changes
of the other owners’ equities except for the net gains and losses, other comprehensive profits as well
as the profits distribution when losing control, the relevant other comprehensive incomes and the
changes of the other owners’ equities are restated as investment gains for current period , with the
47
Dalian Refrigeration Co., Ltd. 2015 Annual Report
exception of the other comprehensive incomes occurred because of the changes of net liabilities or
net assets of the defined benefit pension plans be re-measured for setting by the investees.
2) Step by step disposing the subsidiaries
Where the Company losses control on its original subsidiaries due to step by step disposal of equity
investments through multiple transactions, all the transaction terms, conditions and economic
impact of the disposal of subsidiaries’ equity investment are in accordance with one or more of the
following conditions, which usually indicate the multiple transactions should be considered as a
package deal for accounting treatment:
a. The transaction was set up in the same time or had considered the influence to each others;
b. The transaction only stand as a whole, a perfect commercial result can be arrived.
c. A transaction incurred depends on at least one transaction occurred;
d. A transaction is not economical, however, together with other transaction are economical.
When disposing each transaction of the Company losses control on its subsidiaries due to disposal
of equity investments belonging to a package deal, should be considered as a transaction and
conduct accounting treatment. However, Before losing control, every disposal cost and
corresponding net assets balance of subsidiary of disposal investment are confirmed as other
comprehensive income in consolidated financial statements, which together transferred into the
current profits and losses in the loss of control , when the Company losing control on its subsidiary.
When disposing each transaction of the Company losses control on its subsidiaries due to disposal
of equity investments not belonging to a package deal, before which losing the control right, should
execute the accounting disposal according to the partly dispose the equity investment of the
subsidiaries under the situation not losing the control right; when losing the control right, should
execute accounting disposal according to the general disposing method disposal of the subsidiaries.
C. Purchasing minority equities of the subsidiaries
If there is any difference between the newly obtained long-term equity investment due to the
Company’s acquisition of minority interests and the Company’s share of identifiable net assets
which began to be calculated from the purchase date (or the combination date) in the subsidiary
calculated according to the newly increased shareholding ratio, the stock premium under capital
reserve in the balance sheet shall be adjusted according to the said difference. If the stock premium
under capital reserve is not sufficient to be offset, the retained profit is adjusted.
D. Disposing the equity investment of the subsidiaries under the situation not losing the
control right
The differences between the disposal income due to the Company’s disposal of some equity
investments in a subsidiary without losing the control over the subsidiary and the Company’s share
of net assets in the subsidiary calculated according to the disposed long-term equity investments, the
stock premium under capital reserve in the balance sheet shall be adjusted according to the said
difference. If the stock premium under capital reserve is not sufficient to be offset, the retained
profit is adjusted.
7. Joint venture arrangements classification and co-operation accounting treatment
A.Joint venture arrangements classification
Under the terms of the structure of the company, the legal form of the joint venture arrangements
agreed in the joint venture arrangements, other factors such as the relevant facts and circumstances,
the joint venture arrangements include co-operation and joint ventures.
The joint venture arrangement unreached by individual entity is divided into common business;
joint venture arrangement reached by individual entity usually classified as a joint venture; but there
is conclusive evidence that any of the following conditions are satisfied and the division of joint
venture arrangements in line with the relevant laws and regulations for the common business:
(1)The legal form of a joint venture arrangement shows that the joint venture party have rights and
bear obligations in respect of the relevant assets and liabilities.
(2)Contractual terms of the JV agreement arrangements agrees that the joint venture party have
rights and bear obligations in respect of the relevant assets and liabilities.
(3)Other relevant facts and circumstances indicate that the joint venture party have rights and bear
obligations in respect of the relevant assets and liabilities.
If joint venture parties enjoy almost all outputs associated with the joint venture arrangements, and
the settle of the liability arrangement continued reliance on joint venture the joint venture party
support.
48
Dalian Refrigeration Co., Ltd. 2015 Annual Report
B. Accounting treatment of the joint operation
The Company confirms that the following items share a common interest in the business associated
with the Company, and audit in accordance with the provisions of the relevant enterprise accounting
standards:
(1)Confirm individual assets and common assets held based on shareholdings;
(2)Confirm individual liabilities and shared liabilities held based on shareholdings;
(3)Confirm the income from the sales revenue of co-operate business output
(4)Confirm the income from the sales of the co-operate business output based on shareholdings;
(5)Confirm the individual expenditure and co-operate business cost based on shareholdings.
The company co-operates to invest or sell assets (excluding the assets constituting the business),
before sold to third party, only confirm the part of transaction gains and losses that attributable to
other participants. Assets sold in accordance with "Enterprise Accounting Standards No. 8
Impairment of Assets" and other provisions, the Company confirmed all the loss.
The company co-operates to purchase assets (excluding the assets constituting the business), before
sold to third party, only confirm the part of transaction gains and losses that attributable to other
participants. Assets acquired in accordance with "Enterprise Accounting Standards No. 8
Impairment of Assets" and other provisions, the Company confirmed that part of loss based on
shareholdings.
The Company is not entitled to jointly controlled, if the Company co-operate the relevant assets and
bear related liabilities, need accounting treatment based upon the above principles.
Otherwise, should be accounted in accordance with the relevant provisions of accounting standards.
8. The standard for recognizing cash equivalent when making cash flow statement
Cash equivalent means the highly liquid, very safe investment which can be easily converted into
cash, and the company can hold it for a very short time (3 months from the date of purchase).
9. Method of foreign currency translation
A.Business of foreign currencies
As for a foreign currency transaction, the amount in the foreign currency shall be translated into the
amount in the Renminbi at the spot exchange rate of the transaction date. On balance sheet date, the
foreign currency monetary items shall be translated as the spot exchange rate on the balance sheet
date, the balance occurred thereof shall be recorded into the profits and losses at the current period
except that the balance of exchange arising from foreign currency borrowings for the purchase and
construction or production of assets eligible for capitalization shall be measured in the light of
capitalization principle. The foreign currency non-monetary items measured at the historical cost
shall still be translated at the spot exchange rate on the transaction date, of which the amount of
functional currency shall not be changed.
The foreign currency non-monetary items measured at the fair value shall be translated at the spot
exchange rate on the confirming date of fair value, of which the balance of exchange shall be
included into the profit and loss of the current period or capital reserve. If it belongs available for
sale foreign currency non-monetary items, the difference form of exchange record into other
comprehensive income
B. Translation for foreign currency financial statements
All the assets and liabilities items should be translated as CNY according to the basic rate of the
spot rate on the balance sheet date; All the equity item except " Undistributed profits" item, other
item adopt spot exchange rate to exchange. Income and cost item in profit statement, adopt average
exchange rate of opening period and closing period. The translation balance of foreign financial
statement incurred in line with the aforesaid translation, recorded into other comprehensive income.
When disposing an overseas business, the Company shall shift the balance, which is presented
under the items of the owner’s equities in the balance sheet and arises from the translation of foreign
currency financial statements related to this oversea business, into the disposal profits and losses of
the current period. When disposing part of equity investment or the decrease of holding of oversea
operating share equity proportion but not losing control of the oversea operation due to other reason,
the translation reserve related to disposal part of oversea operation will belong to the translation
balance of minority shareholders, and not transfer into current profits or losses. When disposing part
of equity of joint venture or association enterprise oversea operation, the translation reserve related
to the oversea operation will transfer into current profits or losses in line with the disposal
49
Dalian Refrigeration Co., Ltd. 2015 Annual Report
proportion.
10. The recognition and measurement of financial instruments and the transfer of the
financial instruments
A. Categorization of financial instruments
The Management team shall divide the financial instruments pursuant to the purpose to acquire the
said financial assets or undertake the financial liabilities: the financial assets and liabilities which
are measured at their fair values and of which the variation is included in the current profits and
losses, including transactional financial assets and liabilities and the designated financial assets and
liabilities which are measured at their fair values and of which the variation is included in the
current profits and losses; the investments which will be held to their maturity; loans and the
account receivables; financial assets available for sale; and other financial liabilities.
B. Recognition basis and calculation method of financial instrument
(1)Financial assets (liabilities) measured by fair value and the changes included in the current gains
and losses
The financial assets (or financial liabilities) that are measured by fair value with its change s
recognized in the current profits and losses, including the transactional financial assets or financial
liability and the financial assets or financial liabilities that are directly designated to be measured by
fair value with its change recognized in the current losses and profits.
Transactional financial assets or financial liabilities mean the financial assets or financial liabilities
that meet any one of the following conditions:
1) The purpose of obtaining the financial assets or financial liabilities is to sell, repurchase or
redeem it in a short time;
2) It is a part of the identifiable combination of financial instrument that the company manages
together and there is objective evidence of a recent pattern of short-term profit making;
3) It belongs to the derivative financial instrument, but is designated as the derivative instrument of
valid arbitrage instrument or belongs to the derivation instrument of financial guarantee contract, or
it is connected to the equity instrument investment for which there is no quotation in active market
and its fair value cannot be reliably measured, the derivative tool that shall be settled through
delivering the equity instrument excluded.
Only if one of the following conditions is met, could the financial assets or financial assets be
designated as the financial assets or financial liability that shall be measured by fair value with
changes recognized in profit or loss in the period:
1) The designation is able to eliminate or obviously reduce the discrepancies in the recognition or
measurement of relevant gains or losses arising from the different basis of measurement of the
financial assets or financial liability;
2) The official written document of risk management or investment strategies of the enterprise
concerned have described that the said combination of financial assets, the combination of financial
liabilities, or the combination of financial assets and financial liabilities will be managed and
evaluated on the basis of their fair values and will be reported to the key management personnel.
3) The mixed instruments include one or more embedded derivative instrument, unless the
embedded derivative instrument does not materially change the cash flow of the mixed instrument,
or it is obvious that the embedded instrument shall not be split from the relevant mixed instrument;
4) The mixed instrument that include the embedded derivative instrument that shall be split but
cannot be separately measured when it is obtained or on the subsequent date of balance sheet.
For the financial assets or financial liabilities that is measured by fair value with its change
recognized in the current profits or losses, the company will use the fair value (deducting the cash
dividend that is announced but not issued, or the bond interest that is due but has not be claimed) as
the initially recognized amount, and the related transaction costs shall be recognized in the current
profits and losses. The interest or cash dividend obtained during the holding period shall be
recognized as the investment earning, and at the end of the period, the change in fair value shall be
recognized in the current profits and losses. At the time of disposal, the difference between its fair
value and the initially recognized amount shall be recognized as the investment earnings, and at the
same time, the change in fair value shall be recognized as the profit or loss.
(2) Accounts receivable
The creditor’s rights arising from selling goods or providing service by the Company and other
creditor’s rights to other enterprises held by the company that are not quoted in an active market,
including accounts receivable, notes receivable, other receivables, long-term receivables, etc., the
50
Dalian Refrigeration Co., Ltd. 2015 Annual Report
contract or agreement price should be taken as the initial recognition amount. If it has the nature of
financing, it shall be recognized by present value.
Difference between the amount received and book value of the receivables shall be included into the
profit or loss of the current period upon collection or disposal.
(3) Available-for-sale financial assets
Available-for-sale financial assets were referred to the non-derivative financial assets available for
sale, as well as the financial assets other than the other financial asset classes in the initial
recognition.
When available-for-sale financial assets are acquired, its initial amount shall be recognized at the
fair value (excluding cash dividends that have been declared but not yet distributed or bond interests
that have matured but not yet received) plus transaction expense thereof. Interest or cash dividend
received in holding period were recognized as investment income. Profits or losses from the change
in fair value of available-for-sale financial assets except impairment losses and translation balance
form foreign monetary financial assets, directly record into other comprehensive income. When
disposing available-for-sale financial assets recorded the difference between the price and the book
value of the financial assets into investment profits or losses, meanwhile, roll out the disposal part
of the accumulative amount of change in fair value originally and directly recorded into other
comprehensive income and record into investment profits or losses.
The equity instrument investment without offer and its fair value without reliable calculation, and
derivative financial assets linked to and settled by the equity instruments, measured at cost.
(4)Other financial liabilities
Other financial liabilities shall be initially recognized at fair value plus transaction costs. The
subsequent measurement shall be made by adopting amortized costs.
C. Recognition and measurement of transfer of financial assets
Where an enterprise has transferred nearly all of the risks and rewards relating to the ownership of
the financial asset to the transferee, it shall stop recognizing the financial asset. If it retains nearly all
of the risks and rewards relating to the ownership of the financial asset, it shall not stop recognizing
the financial asset.
Substance over form philosophy should be adopted to determine whether the transfer of a financial
asset can satisfy the conditions as described in these Standards for de-recognition of a financial asset.
An enterprise shall differentiate the transfer of a financial asset into the entire transfer and the
partial transfer of financial assets. If the transfer of an entire financial asset satisfies the conditions
for stop recognition, the difference between the amounts of the following 2 items shall recorded in
the profits and losses of the current period:
(1) The carrying amount of the transferred financial asset;
(2) The aggregate consideration received from the transfer, and the accumulative amount of the
changes of the fair value originally recorded in the owner’s equities (in the event that the financial
asset involved in the transfer is a financial asset available for sale).
If the transfer of partial financial asset satisfies the conditions for stopping recognition, the carrying
amount of the entire financial asset transferred shall be allocated at their respective relevant fair
value, between the portion whose recognition has stopped and the portion whose recognition has not
stopped, and the difference between the amounts of the following 2 items:
(1) The carrying amount of the portion whose recognition has stopped;
(2) The aggregate consideration of the portion whose recognition has stopped, and the portion of the
accumulative amount of the changes in the fair value originally recorded in the owner’s equities
which is corresponding to the portion whose recognition has stopped (in the event that the financial
asset involved in the transfer is a financial asset available for sale).
The transfer of financial assets does not meet the de-recognition condition, the financial assets shall
continue to be recognized, and the consideration received will be recognized as financial liabilities.
D. Termination of recognition of financial liabilities
Only when the prevailing obligations of a financial liability are relieved in all or in part may the
recognition of the financial liability be terminated in all or partly. Where the Company (debtor)
enters into an agreement with a creditor so as to substitute the existing financial liabilities by way of
any new financial liability, and if the contractual stipulations regarding the new financial liability is
substantially different from that regarding the existing financial liability, it shall terminate the
recognition of the existing financial liability, and shall at the same time recognize the new financial
liability.
Where the Company makes substantial revisions to some or all of the contractual stipulations of the
51
Dalian Refrigeration Co., Ltd. 2015 Annual Report
existing financial liability, it shall terminated the recognition of the existing financial liability or part
of it, and at the same time recognize the financial liability after revising the contractual stipulations
as a new financial liability.
Where the recognition of a financial liability is totally or partially terminated, the Company
concerned shall include into the profits and losses of the current period the gap between the carrying
amount which has been terminated from recognition and the considerations it has paid (including
the non-cash assets it has transferred out and the new financial liabilities it has assumed).
Where the Company buys back part of its financial liabilities, it shall distribute, on the report day,
the carrying amount of the whole financial liabilities in light of the comparatively fair value of the
part that continues to be recognized and the part whose recognition has already been terminated.
The gap between the carrying amount which is distributed to the part whose recognition has
terminated and the considerations it has paid (including the non-cash assets it has transferred out
and the new financial liabilities it has assumed) shall be recorded into the profits and losses of the
current period.
E. Determination of the fair value of financial assets and financial liabilities
As for the Company’s financial assets and liabilities measured at their fair values, where there is an
active market, the closing quoted prices in the active market shall be used to determine the fair
values thereof. Initially obtained or derivative financial assets or the market transaction price of
bared financial liabilities was considered as the basis of fair value; Where there is no active market
for a financial assets and financial liabilities, the Company concerned shall adopt value appraisal
techniques to determine its fair value. When evaluating, the Company adopt the valuation technique
with sufficient useful data and supported by other information which suitable for the current
situation, choose a input in concern with the characteristics of assets or liabilities considered in
relevant assets or liabilities transaction with the market players, and as much as possible, give prior
to using the relevant observable input under the situation that, the observable input value or it is not
feasible to obtain, use unobservable input value.
F. Testing method of impairment and withdrawal method of provision for impairment on
financial assets (excluding accounts receivable)
Except for financial assets which are measured at their fair values and of which the variation is
included in the current profits and losses, the Company checks the book values of all other financial
assets on the balance sheet date. If there is objective evidence proving that a financial asset is
impaired, an impairment provision is made.
The objective evidences of impairment provision of financial assets include but not limited to:
(1) Issuer or debtor had serious financial difficulties.
(2)The debtor violates the items of the contact, such as violate a treaty or overdue to repay the
interest or principal, etc.
(3) The creditor considering the factors of economy or law makes concession to the debtor who had
serious financial difficulty.
(4)The debtor probably may go out of business or had other financial recombination.
(5) Due to the issuer had serious financial difficulty; the financial assets cannot continue to trade in
the active market.
(6)The cash flow of a kind of asset in a group of financial assets decrease or not was beyond
recognition, however, after conducting the overall evaluation in line with the public data, the
estimate cash flow of the group of financial assets actually decrease and gaugeable since initial
recognition, if the repay ability of the debtor steadily worsened, or the increase of unemployment
rate, the decrease in the price of guaranty or the industry downturn that the district or country the
debtor in, etc.
(7)The great disadvantage change in technology, market, economy or legal environment that
operation place that issuer of equity instrument locate at, which lead to the irrecoverable of
investment cost of the equity instrument investors.
(8)The fair value occurred seriously or non-transient decrease.
The specific impairment provision methods of financial assets were as follows:
(1) Provision for impairment of available-for-sale financial assets:
On balance sheet date, the Company executes individually inspection on each available-for-sale
financial statement, if the fair value of the equity instruments which invests on the balance sheet
date is lower than its initial investment cost for more than 50% (including 50%) or lower than its
initial investment cost for the duration time for more than 1 year (including 1 year), which indicates
that it had occurred impairment; if the fair value of the equity instruments which invests on the
52
Dalian Refrigeration Co., Ltd. 2015 Annual Report
balance sheet date is lower than its initial investment cost for more than 20% (including 20%) but
not reaches at 50%, the Company will comprehensively considerate the other relevant factors such
as the price volatility etc. and will judge the equity investment whether had occurred impairment.
The aforesaid "cost" recognized in line with the initial investment cost of available for sale financial
instrument deducting principal recovered, amount amortized and the impairment losses recorded
into profits or losses. “fair value" recognized through the closing price of Securities Exchange at
period end unless the investment of available for sale equity instrument was in the restricted stock
trade period. For investment of available for sale equity instrument was in the restricted stock trade
period, recognized in line with the closing price of Securities Exchange at period end deducting the
risk of market player cannot sell the equity instrument, thus, require compensation.
Where a sellable financial asset is impaired, even if the recognition of the financial asset has not
been terminated, the accumulative losses arising from the decrease of the fair value of the owner’s
equity which was directly included shall be transferred out of the owners’ equities and recorded into
the profits and losses of the current period. The accumulative losses that are transferred out shall be
the balance obtained from the initially obtained costs of the sold financial asset after deducting the
principals as taken back, the current fair value and the impairment-related losses as was recorded
into the profits and losses of the current period.
As for the sellable debt instruments whose impairment-related losses have been recognized, if,
within the accounting period thereafter, the fair value has risen and are objectively related to the
subsequent events that occur after the originally impairment-related losses were recognized, the
originally recognized impairment-related losses shall be reversed and be recorded into the profits
and losses of the current period. As for the impairment-related losses incurred to a sellable equity
instrument investment, should be reversed by equity when the value raised of the equity instruments;
however, the impairment-related losses incurred to an equity instrument investment for which there
is no quoted price in the active market and whose fair value cannot be reliably measured, or
incurred to a derivative financial asset which is connected with the said equity instrument and which
shall be settled by delivering the said equity instrument, may not be reversed.
(2) Provision for impairment of the investments which will be held to their maturity
If there’s objective evidence that the financial assets are impaired, then the carrying amount of
financial assets are reduced to the present value of estimated future cash flows, with the reduced
amount recognized to profit or loss for the current period. As for the investments which will be held
to their maturity whose impairment-related losses have been recognized, if, within the accounting
period thereafter, the fair value has risen and are objectively related to the subsequent events that
occur after the originally impairment-related losses were recognized, the originally recognized
impairment-related losses shall be reversed and be recorded into the profits and losses of the current
period.
G. The offset of financial assets and financial liabilities
Financial assets and financial liabilities are shown separately in balance sheet However, if they
satisfy the following conditions, shown the net amount in the balance sheet after the offset;
(1) The Company had legal rights of offsetting the recognition amount, and the legal right is
executable in recently.
(2) The Company plans to settle at net amount, or meanwhile realize the financial assets and pay off
the financial liabilities.
11. Receivable accounts
A.Recognition and providing of bad debt provision on individual receivable account with
large amount
Basis of recognition or standard
amount of individual account Top 5 of account receivables at year end
with large amount
Impairment test performed individually, bad debt provision will be
provided at the difference of expected cash flow lower than the book
Basis of bad debt provision
value. Without bad debt provision needed provided through individually
test, bad debt provision will be provided at age analysis method.
B. Recognition and providing basis of bad debt reserves for group of receivable accounts with
similar characteristics of credit risks
①Basis of recognition and providing of bad debt provision
53
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Basis of recognition for groups
Group of inner units Accounts receivable due from subsidiaries included in consolidated scope
Group by age analysis With similar characteristics of credit risks
Basis of bad debt provision
Group of inner units Individual identified method
Group by age analysis Age analysis method
②Age analysis
Provision rates for Provision rates for
Ages
account receivables (%) other receivables (%)
Within 1 year, (included, same for the followings) 5% 5%
1-2 years 10% 10%
2-3 years 30% 30%
3-4 years 50% 50%
4-5 years 80% 80%
Over 5 years 100% 100%
C.Other minor amount
For the receivables which are not individually significant, and which individually significant but are
not provided provision individually, in accordance with credit risk characteristics, the method of
provision for bad debts is aging analysis method. The assessment is made collectively where
receivables share similar credit risk characteristics (including those having not been individually
assessed as impaired), based on their historical loss experiences, and adjusted by the observable
figures reflecting present economic conditions.
12. The classification, pricing and accounting methods for inventories; the recognition
standard and withdrawal method of the inventories falling price reserves
A. Classification of the inventories: purchased materials, stocking materials, material cost difference,
entrusted processing materials, unfinished products, finished products, working on project and etc.
B.The inventories are priced by the historical cost method, so are the raw material and auxiliary
material, the sold material cost is carried over on the basis of first-in first-out method; the product
cost is accounted through standard cost method, the difference between the standard cost and
historical cost is undertaken by the cost of the finished goods in process, while the cost of sales is
carried over on the basis of weighted average method;
C. As for the inventory write-down provided: each kind of inventories at the end of the report
period will be measured at the lower of cost or net realizable value, and a provision for inventory
write-down will be established for any difference between the cost and the lower net realizable
value. The net realizable value refers to the value minus the predicted expense needed in the process
of completing the production and sales from the predicted price for sale and the taxes.
D. The inventory system is on the basis of perpetual inventory method.
E. The low-value consumption goods will be amortized by fifty percent amortization method.
13. Classified as the assets held for sale
A. Recognition criteria for the classification of the assets held for sale
The company will recognize the combination parts of the enterprise (or non-current assets) which
simultaneously meet the following requirements, as the components of the assets held for sale.
(1) The components should be immediately sold under the current condition only according to the
usual terms of the parts sold.
(2) The enterprise has made resolution for the disposal of the components, the approval of
shareholders’ meeting or relevant authority agency if the shareholder’s approval is requested by the
rules.
(3) The enterprise has signed the irrevocable transfer agreement with the transferee.
54
Dalian Refrigeration Co., Ltd. 2015 Annual Report
(4) The transfer shall be completed within one year.
B. Accounting method for the classification of the assets held for sale
For the fixed assets held for sale, the company shall adjust the estimated net residual value of the
fixed assets in order to make it reflecting the amount after the disposal costs deducted from the fair
value, which doesn’t exceed the original book value of the fixed assets when the condition of
holding for sale is met. The impairment losses of the assets shall be regarded and recorded into the
current profits and losses if the original book value is more than the balance of the estimated net
residual value after adjusting. The fixed assets held for sale which not withdraw the depreciation or
amortization shall be measured according to the lesser one between the balances of the book value
or the fair value minus the disposal costs respectively.
The equity investment, intangible assets and other non-current assets held for sale shall be handled
as per above mentioned principles, but excluding the deferred income tax assets, the financial assets
regulated in ―Accounting Standards for Enterprises No.22 – Recognition and Measurement of
Financial Instruments‖, the investment property and the biological assets measured by the fair value,
and the contractual right issued in the insurance contract.
14.Long-term equity investment
A.Investment cost confirmation
(1) For the long term equity investment from enterprise merger, the detailed accounting policy,
please refer to the accounting method of merger of enterprises under or not under the same
controller in Note IV / (V). While, the long term equity investment acquired through liability
reorganization is booked on the basis of fair value.
(2) The long-term equity investments acquired by other ways
For the long-term equity investment acquired by the cash payment method, the purchase price of
actual payment as the initial investment cost, which includes costs, taxes and other necessary
expenses directly relevant to the long-term equity investment acquired.
For the long-term equity investment acquired by the issuance of the equity securities, the fair value
of the issuance of the equity securities as the initial investment cost. The transaction costs occurred
in the issuance or acquirement of own equity instruments can be deducted from the equity for those
that can be directly included in the equity transactions.
The non-monetary asset exchange for a commercial real income and assets or the fair value other
assets can be reliably measured, the initial investment cost should be determined according to
long-term equity investment exchanged through the non-monetary asset exchange, unless there is
evidence showing that for the fair value of assets is more reliable; the non-monetary asset exchange
which does not meet the above premises, the book value of the exchanged assets to and the relevant
fees and taxes to be paid should be the initial investment cost of the long-term equity investment.
The initial investment cost of the long-term equity investments obtained through debt restructuring
should be determined in accordance with fair value.
B.Follow-up measurements & recognitions of profits or losses
(1) Cost method
The company can adopt the cost method to account the long-term equity investment controlled by
the invested party and follow the initial investment cost to calculate the price and add or take back
the investment and adjust the costs of long-term equity investment.
Except for the price of actual payment in acquiring investment or the cash dividends or profits
declared but not issued yet included in the consideration, the company shall recognize the cash
dividends or profits delivered by the invested party as the current investment returns.
(2) The equity method
The company shall adopt the equity method to account the long-term equity investment of the joint
ventures and the cooperative enterprises, and use the measurement of the fair value and record the
changes into the profits and losses for the parts of the equity investment of the joint ventures
indirectly held by risk investment agency, mutual fund, trust company or other similar bodies
including the investment-link-insurance funds.
For the initial investment cost of the long-term equity investment is more than the balance of the
shares of the fair value of the identifiable net assets from the invested party in investment, the initial
investment cost of the long-term equity investment shouldn’t be adjusted. If less, recorded into the
current profits and losses.
The investment returns and other comprehensive incomes will be respectively recognized as per the
shares of the net profits and losses and other comprehensive returns realized by those shared and
55
Dalian Refrigeration Co., Ltd. 2015 Annual Report
undertaken invested parties after the company acquires the long-term equity investment, and the
book value of long-term equity investment shall be adjusted simultaneously. Also, the shared parts
shall be calculated according to the profits and cash dividends delivered by the invested party, and
the book value of long-term equity investment shall be reduced correspondingly. For other changes
in owner’s equity of the invested parity except for net profits and losses, other comprehensive
returns and profits distribution, the book value of long-term equity investment shall be adjusted and
the owner’s equity should be recorded into.
The shared portions of the net profits and losses of the invested party shall be recognized by the
company after the net profits of the invested party are adjusted based on the fair value of the
identifiable assets from the invested party when acquiring the investment. Also, the profits and
losses of investment are recognized on the basis of the offset of the shared proportion for the
internal transaction profits and losses issued but not realized yet between the company and the joint
venture and the cooperation enterprises.
The following steps should be taken when the company confirms to share the losses of the invested
party: First, offset the book value of the long-term equity investment. Then, offset the book value of
the long-term receivables after recognize the investment losses based on the book value of
long-term equity of the net investment from the invested party if the book value of the long-term
equity investment is insufficient to offset. Last, recognize the estimated loads as per the estimated
liability undertaken and record into the current investment losses if additional liability is still needed
to undertake based on the provisions of investment contract or agreement after above-mentioned
steps.
For the profits realized by the invested party during the future period, the company shall handle
based on the opposite steps after deducting the unconfirmed losses undertaken, and resume the
recognized investment returns after reduce the confirmed book balance of estimated liabilities and
resume other book values of long-term rights and investments of the net investment from the
invested party.
C. Transformation of accounting method for the long-term equity investment
(1) The fair value measurement transformed to the equity method
For the equity investments originally held by the company and having non-control, joint control or
major impact on the invested party through the accounting treatment as per the confirmation of
financial instrument and the measurement criterion, which can have significant impact or haven’t
control on the invested party due to the additional investment, the sum of the fair value of the equity
investment originally held and the new investment costs based on the recognition of ―Accounting
Standards for Enterprises No.22 – Recognition and Measurement of Financial Instruments‖ shall be
regarded as the initial investment costs accounted by the equity method.
If the equity investment held originally can be classified as the financial assets for sale, the
difference between the fair value and the book value, and the variation in the accumulative fair
value of other comprehensive returns recorded originally will be transferred into the current profits
and losses accounted by the equity method.
If the initial investment costs accounted by the equity method is less than the difference between the
portions of the fair value of the identifiable net assets shared from the invested party on the
additional investment date calculated and recognized as per the new shareholding proportion after
the additional investment, the book value of long-term equity investment should be adjusted and
which shall be recorded into the current nonbusiness incomes.
(2) The fair value measurement or the equity method transformed to the cost method
For the equity investments originally held by the company and having non-control, joint control or
major impact on the invested party through the accounting treatment as per the confirmation of
financial instrument and the measurement criterion, or the long-term equity investments in the joint
ventures and the cooperative enterprises held originally, which can have control on the invested
party under non-common control due to the additional investment, the sum of the book value of the
equity investment originally held and the new investment costs in preparation of individual financial
statement shall be regarded as the initial investment costs accounted by the cost method.
Other comprehensive returns accounted and recognized for the equity investment held prior to the
purchase date by adopting the equity method, should be conducted the accounting treatment
according to the same basis of relevant assets or liabilities directly disposed by the invested party.
If the equity investment held before the purchase date is conducted the accounting treatment
according to the relevant provisions of ―Accounting Standards for Enterprises No.22 –
Recognition and Measurement of Financial Instruments‖, the variation in the accumulative fair value
of other comprehensive returns recorded originally shall be transferred to the current profits and
56
Dalian Refrigeration Co., Ltd. 2015 Annual Report
losses accounted by the cost method.
(3) The equity method transformed to the fair value measurement
If the company loses the joint control or major impact on the invested party due to disposal of part
of equity investments, the remaining equity after disposed should be accounted according
to ―Accounting Standards for Business Enterprises No.22 – Recognition and Measurement of
Financial Instruments‖, and the balance between the fair value and the book value shall be recorded
into the current profits and losses on the date of joint control or major impact lost.
Other comprehensive returns accounted and recognized for the original equity investment by
adopting the equity method, should be conducted the accounting treatment according to the same
basis of relevant assets or liabilities directly disposed by the invested party when stop to account by
the equity method.
(4) The cost method transforming to the equity method
If the company loses the control of the invested party due to disposal of part of equity investments,
and the remaining equity after disposed can have joint control or major impact on the invested party
in preparation of individual financial statement, the equity method shall be adopted to conduct
accounting and the remaining equity shall be regarded to use the equity method to account and
adjust when acquiring.
(5) The cost method transforming to the fair value measurement
If the company loses the control of the invested party due to disposal of part of equity investments,
and the remaining equity after disposed can’t have joint control or major impact on the invested
party in preparation of individual financial statement, the relevant provisions of ―Accounting
Standards for Enterprises No.22 – Recognition and Measurement of Financial Instruments‖ should
be followed to conduct the accounting treatment, and the balance between the fair value and the
book value shall be recorded into the current profits and losses on the date of control lost.
D. Disposal of the long-term equity investment
The difference between the book value and the price acquired actually in disposal of the long-term
equity investment should be recorded into the current profits and losses. The long-term equity
investment accounted by the equity method shall be conducted the accounting treatment of part of
other original comprehensive returns as per the corresponding proportion on the same basis of the
relevant assets or liabilities directly disposed by the invested party when the disposal of the
investment.
If the following one or multiply requirements are met for all transaction terms, conditions and
economic impact in disposal of the equity investment of subsidiary, the multiply transactions will be
regarded as the package deal to conduct the accounting treatment:
(1) These transactions are signed simultaneously or after the consideration of the influence each
other.
(2) These transactions should be as a whole to achieve a complete business result.
(3) One transaction occurs depending on the issuance of at least other one transaction.
(4) It is uneconomic for one transaction, but economic with other transactions.
For the control on the original subsidiary lost due to disposal of part of the equity investment or
other reasons and the non-package deal, the relevant accounting treatment should be respectively
conducted for the individual financial statement and the consolidated financial statements:
(1) In the individual financial statement, the difference between the book value and the price
acquired actually in disposal of the equity shall be recorded into the current profits and losses. If the
remaining equity after disposed can have joint control or major impact on the invested party, the
equity method shall be adopted to conduct accounting and the remaining equity shall be regarded to
use the equity method to account and adjust when acquiring. If the remaining equity after disposed
can’t have joint control or major impact on the invested party, the relevant provisions
of ―Accounting Standards for Enterprises No.22 – Recognition and Measurement of Financial
Instruments‖ should be followed to conduct the accounting treatment, and the balance between the
fair value and the book value shall be recorded into the current profits and losses on the date of
control lost.
(2) In the consolidated financial statements, for all the transactions before the control on subsidiary
lost, and the balance between the disposal price and the long-term equity investment respectively
minus the net assets from the purchase date or the combination date of subsidiary, the capital
reserves (stock premium) shall be adjusted, or the retained earnings shall be adjusted when the
capital reserves are insufficient. When the control on the subsidiary lost, the remaining equity
should be measured again according to the fair value on the control lost date. The difference of the
consideration acquired by the disposal of equity and the fair value of the surplus equity minus the
57
Dalian Refrigeration Co., Ltd. 2015 Annual Report
net assets portion of the original subsidiary calculated from the purchase date a per the original
stock proportion shall be recorded into the current investment income after the control lost and
offset the business reputation. Other comprehensive returns relevant to the original subsidiary shares
investment shall be transferred into the current investment returns when the control lost.
For the package deal for all the transactions in disposal of the equity investment till the control lost,
all the transactions will be conducted the accounting treatment as a deal to dispose and the relevant
accounting treatment should be respectively conducted for the individual financial statement and the
consolidated financial statements:
(1) In the individual financial statement, all the differences between the book value of the long-term
equity investment of the prices disposed and the equity disposed before the control lost shall be
recognized as other comprehensive incomes and recorded into the current profits and losses in the
control lost.
(2) In consolidated financial statement, all the differences between the net assets portions of
subsidiary of the prices disposed and the investment disposed before the control lost shall be
recognized as other comprehensive incomes and recorded into the current profits and losses in the
control lost.
E. Criteria of the judgment of joint control and significant impact
If the company controls an arrangement together with other parties according to the relevant
agreement, the activity decision-making with significant impact for the arrangement should be
achieved after the unanimous agreement gained from the control parties, which is regarded as the
joint control of one arrangement with other parties and the arrangement is belong to the cooperative
arrangement.
The cooperative arrangement achieved by the independent body which should be as the cooperative
enterprises and the equity method shall be adopted to account according to the relevant agreement to
judge when the company has rights to the net assets of the independent body. If hasn’t rights, the
independent body shall be as the joint operation, the company shall recognize the items related to
the benefit portions of joint operation and the accounting treatment should be conducted according
to the relevant provisions of accounting standards for enterprises.
The significant impact refers to the investor has rights to participate in decision-making for the
finance and operation policy of the invested party, but can’t control or jointly control the setup of
these policies with other parties. The company has made judgment of significant impact on the
invested party through the following one or multiply conditions and under comprehensive
consideration of all facts and status.
(1) There are representatives in the board of Directors or equivalent authorities of the invested party.
(2) Participate in the setup process of finance and operation policies of the invested party.
(3) There is major transactions occurred among the invested parties.
(4) Dispatch the management to the invested party.
(5) Offer the key technical data to the invested party.
15. Investment real estates
The term Investment real estates refers to the real estates held for generating rentand/orcapital
appreciation, including the right to use any land which has already been rented, the right to use any
land which is held and prepared for transfer after appreciation & the right to use any building which
has already been rented.
The investment real estates are accounted by the cost, the purchased investment real estates include
the cost of the purchase price, related taxes and fees and other expenses which can be directly
attributable to the assets; the costs of investment real estate self constructed include the necessary
expenses to construct the asset to reach the predicted use state.
The Group adopts the cost method to conduct follow-up measurement on investment real estates are
accounted devaluations and amortized. The expected service life, net residual rate and value
depreciation rates of investment real estate are the same with fixed assets or intangible assets.
If the investment real estate is changed to self use, since the date of change, investment real estate
shall be converted into fixed assets or intangible assets. The function of self-use real estate is to earn
rent or capital appreciation, then since the date of change, the fixed assets or intangible assets shall
be converted into investment real estate. When the conversion happens, the book value before the
conversion will be the book value after the conversion.
When the investment real estate is disposed of, or permanently terminates its use and no economic
benefits are expected from its disposal, terminate the confirmation of the investment real estate.
58
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Disposal income of investment property for sale, transfer, disposal of scrap or being destroyed is
charged to current profit or loss after deducting its book value and related taxes.
16. Fixed assets
A. Confirmation conditions
Fixed assets refer to physical assets owned for purpose of production, service providing, leasing or
management, and operation with service life of more than one year. Fixed assets are recognized
when all of the following conditions are satisfied：a.Financial benefits attached to the fixed asset is
possibly inflowing to the Company;b.The cost of the fixed asset can be reliable measured.
B.The initially measurement of fixed assets
The fixed assets of the company shall be initially measured by costs. Of which, the fixed assets
costs purchased include purchase price, import duties, other relevant taxes and other expenses that
make the fixed assets can be used. The costs of self-constructed fixed assets are the expenses arisen
from the construction of the assets reaching the expected use status. The fixed assets invested by the
investors shall be recorded into the accounting value according to the value agreed in the investment
contract or agreement, but the unfair value agreed in the contract or agreement shall be bookkept as
per the fair value. If the price for purchase of the fixed assets is beyond the usual credit term and
delay in payment, and there actually is financial, the cost of fixed assets shall be recognized based
on the present value of purchase price. The difference between the price paid actually and the
present value of purchase price shall be recorded into the current profits and losses within the credit
period except for the capitalization granted.
C. The subsequent expenditure and disposal of fixed assets
(1)Deprecation method of fixed assets
The fixed assets depreciation should be withdrawn within the expected service life according to the
recorded value minus the estimated net residual value. For the fixed assets after the impairment
provision withdrawn, the amount of depreciation shall be recognized according to the book value
after the impairment provision deducted and the usable service life in the future.
The company determines the service life and the estimated net residual value of the fixed assets
according to the nature and use of the fixed assets, reviews the service life, the estimated net
residual value and depreciation method of the fixed assets at the end of the year, and makes the
corresponding adjustment if it is different to the original estimated value.
Depreciation is calculated using the straight-line method to allocate their cost to their residual
values over their estimated useful lives, as follows:
Expected residual value
Fixed assets Estimated lifetim Annual depreciation rates
rates
Buildings 20-40 years 2.25-4.85% 3%、 5%、10%
Machinery and equipment 10-22 years 4.09-9.7% 3%、 5%、10%
Motor vehicles 4-15 year 6-24.25% 3%、 5%、10%
Electric equipments 5 years 18-19.4% 3%、 5%、10%
Other equipments 10-15 years 6-9.7% 3%、 5%、10%
(2) The subsequent expenditure of the fixed assets
The subsequent expenditure relevant to the fixed assets shall be recorded into the costs of the fixed
assets if the recognition requirements of the fixed assets are met. If not met, recorded into the
current profits and losses when occurring.
(3)The disposal of the fixed assets
The fixed assets shall be derecognized when the assets are disposed and can be used or there is no
economic benefit from the disposal. The amount of the book value and the relevant taxes deducted
from the disposal incomes of the fixed assets sold, transferred, scraped or damaged.
D. Cognizance evidence and pricing method of financial leasing fixed assets
The fixed assets acquired by the company in line with the following one or several criteria shall be
recognized as the fixed assets acquired under finance leases: (1) at the expiration of the lease, the
ownership of the leased assets shall be transferred to the company. (2) the company has the option
to purchase the leased assets, the purchase price is expected be far lower than the fair value of the
leased assets under the implementation of option right, so that it can be reasonably determined that
the company shall exercise the option on the acquisition date. (3) the lease term is the majority for
59
Dalian Refrigeration Co., Ltd. 2015 Annual Report
the leased assets even if the ownership no transferred. (4) the present value of the minimum lease
payments of the company almost is equal to the fair value of the leased assets on the acquisition
date. (5) For the special nature of the leased assets, only the company can use if no major
modification made.
For the fixed assets acquired under finance leases, the company takes less of the fair value of the
leased asset on the acquisition date and the present value of the minimum lease payments as
recorded value. Also, the minimum lease payments are accounted as the recorded value for the
long-term payables, and the difference are as the unconfirmed financing fees. The initial direct
expenses, such as commission charge, attorney fees, travel expenses and stamp duty attributable to
the lease item occurred in the process of the lease negotiation and the signature of lease contract,
shall be recorded into the leased assets value. The unrecognized financing charges in each period
during the lease term are amortized by effective interest method.
The company adopts the depreciation policy in line with its own fixed assets to count and draw the
depreciation of fixed assets acquired under finance leases. If the ownership of lease assets acquired
at the expiration of lease can be reasonably confirmed, the depreciation will be recognized in the use
life of lease assets. If can’t be confirmed, the shorter period between the lease term and the use life
of lease assets will be recognized as the depreciation.
17. Construction-in-progress
A. Categories of projects under construction
The company shall measure the self-constructed constructions in progress at the actual cost, which
comprises those expenditures necessarily incurred for bringing the asset to working condition for its
intended use, including materials costs, labor costs, relevant taxes paid, capitalized loans, indirect
expense for apportion, etc.. The constructions in progress of the company should be accounted by
the project classification.
B.Standard and timing for transferring of projects under construction to fixed assets
All the expenditures that bring the construction in process to the expected condition for use shall be
the credit value of the fixed asset. If the fixed asset construction in process has already reached the
expected condition for use, but hasn’t been made the final account; it shall be carried forward to a
fixed asset according to its estimated value based on the budget, cost or actual cost of the
construction starting from the date when it reaches the expected condition for use, and the fixed
asset shall be depreciated according to the company’s depreciation policy for fixed assets. After the
final account has been made, the original provisional estimated value shall be adjusted according to
the actual cost, but the depreciation which has originally been counted & drawn shall not be
adjusted.
18. Loan expenses
A.Recognition principles for capitalizing of loan expenses
Borrowing expenses occurred to the Company that can be accounted as purchasing or production of
asset satisfying the conditions of capitalizing, are capitalized and accounted as cost of related asset.
Other borrowing expenses are recognized as expenses according to the occurred amount, and
accounted into gain/loss of current term.
The assets meeting capital conditions refer to the fixed assets, investment real estates and
inventories which are constructed or produced in a long time to reach the predicted use or sale state.
When a loan expense satisfies all of the following conditions, it is capitalized: a. Expenditures on
assets have taken place, asset expenditures include the assets used to construct or produce the assets
which meet the capitalization conditions, and expend by cash or transferring non-cash assets or
bearing interest debt; b. Loan costs have taken place; c. The construction or production activities to
make assets to reach the intended use or sale of state have begun.
B. Duration of capitalization of loan costs
The capitalization period refers to the period from starting capitalization of loan costs to the stop of
capitalization, the period of the break of capitalization of Loan costs is not included.
When the construction or production meets the intended use or sale of state of capitalization
conditions, the Loan costs should stop capitalization. When the construction or production meets the
conditions of capitalization and can be used individually, the capitalization of the loan costs of the
assets should be stopped.
Where each part of a asset under acquisition and construction or production is completed separately
60
Dalian Refrigeration Co., Ltd. 2015 Annual Report
and is ready for use or sale during the continuing construction of other parts, but it can not be used
or sold until the asset is entirely completed, the capitalization of the borrowing costs shall be ceased
when the asset is completed entirely.
C. Capitalization suspension period
Where the acquisition and construction or production of a qualified asset is interrupted abnormally
and the interruption period lasts for more than 3 months, the capitalization of the borrowing costs
shall be suspended. If the interruption is a necessary step for making the qualified asset under
acquisition and construction or production ready for the intended use or sale, the capitalization of
the borrowing costs shall continue. The borrowing costs incurred during such period shall be
recorded into the profits & losses at the current period, till the acquisition and construction or
production of the asset restarts.
D.Calculation of the amount of capitalization of loan costs
Interest expense due to specialized Loan and its auxiliary expenses shall be capitalized before the
asset which satisfies the capitalizing conditions reaches its useable or saleable status.
Interest amount of common Loan to be capitalized equals to accumulated asset expense less
weighted average of specialized loan part of asset expense multiplies capitalizing rate of common
Loan occupied. Capitalizing rate is determined according to weighted average interest of common
Loan.
If the Loan has discount or premium, the discount or premium amount should be determined
according to actual interests in each accounting period. The interest amount should be adjusted in
each period.
19.Intangible assets and R&D expenses
The intangible assets refer to the identifiable non-monetary assets without physical substance owned
or controlled by the company, including software, land use rights, knowhow and etc.
A.The initial measurement of intangible assets
The cost of the purchased intangible assets includes its buying price, relevant tax and the othe
expenses that are directly attributed to this assets meeting its predetermined objective and other
expenses that occur. The buying price of intangible assets is over the deferred payment under
normal credit conditions, which has the nature of financing materially, the cost of intangible assets
is determined on the basis of the present value of its buying price.
We acquire the mortgaged intangible assets from debtors through debt restructuring and determine
the entry value on the basis of the fair value of the intangible assets,we have the balance between
the book value of debt restructuring and the fair value of intangible assets used for mortgage
charged to the current profit and loss.
The entry value of the non-monetary assets exchanged into by the non-monetary assets are
determined on the basis of the fair value of the assets exchanged out if the exchange of
non-monetary assets has commercial nature and the assets exchanged into or out can be reliably
measured, unless there is authentic evidence indicating that the fair value of assets exchanged into
are more reliable; if the non-monetary assets that cannot meet the above prerequisite use the book
value of the assets exchanged out and relevant taxes payable as the cost of the non-monetary assets,
the profit and loss is not confirmed.
The entry value of the intangible assets acquired by the absorption merger under the control of one
company is determined by the book value of the merged party;the entry value of the intangible
assets acquired by the absorption merger that is not under the control of one company is determined
by the fair value.
The cost of the intangible assets developed internally includes the materials consumed in developing
the assets, cost of service, registration fees, other patent used in developing, amortization of
concession and interest charges meeting the capitalization conditions and othe direct costs that occur
before the intangible assets meeting the predetermined objective.
B.Subsequent measurement
The Company acquired intangible assets at the time of analysis to determine its life, is divided into a
finite useful life and intangible assets with indefinite useful life.
(1)The intangible assets that have limited serviceable life are amortized by the straight-line method
during the period when the assets can bring about economic interests.The details are as follow:
Items Useful life Judging by
Land use rights 50 yeasrs Purchase contract
61
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Items Useful life Judging by
Software 5-10 years Predicted useful life
(2)Intangible assets with uncertain service life may not be amortized. However, the Company shall
check the service life of intangible assets with uncertain service life during each accounting period.
Where there are evidences to prove the intangible assets have limited service life, it shall be
estimated of its service life, and be amortized according to the above method.
C. The specific standards of the classification of research and development stages of internal
R&D projects of the company
Research stage: the stage of the creative and planned investigation and research activities that is to
acquire and understand new scientific or technological knowledge.
Development stage: the stage that the research achievement or other knowledge are applied in some
plans or designs for the production of newly or substantially improved materials, devices, products
and other activities before the commercial production or usage.
The expenditure of internal research and development projects in the research stage shall be
recorded into the current profits and losses when occurring.
D. The special standards of the conformation of capitalization for the expenditure in
development stage
The expenditures of internal research and development projects in the development stage shall be
recognized as the intangible assets when the following requirements are simultaneously met:
(1)Complete the intangible assets to make it usable or for sale and have the technical feasibility.
(2)Have the intention to complete the intangible assets for using or sales.
(3)The mode for the economic interest produced by the intangible assets includes the evidence of
there being the market for the products produced by the intangible assets or for the intangible assets
by self, and the usefulness for the assets used internal.
(4)There are sufficient technical, financial resources and other resources for support to complete the
development of the intangible assets and there is ability to use or sell the intangible assets.
(5)The expenditure belong to the intangible assets in the development stage can be reliably
measured.
The expenditure in the development stage but above-mentioned requirements not met, shall be
recorded into the current profits and losses when occurring. The development expenses recorded
into the profits and losses during previous period shall not be recognized again in the future period.
The capitalized expenses in the development stage are shown as the development costs on the
balance sheet, and shall be transferred to the intangible assets from the date that the project reaching
to the intended use.
20. Impairment of long-term assets
(1) At the end of accounting period, the Company shall check the long-term assets. There may be an
impairment of assets when the following signs occur. The recoverable amount shall be estimated
and the asset impairment loss shall be made in light of the difference that the recoverable amount of
assets is less than the book value when the impairment happens. The signs are stated as follows:
① The current market price of assets falls, and its decrease is obviously higher than the expected
drop over time or due to the normal use;
②The economic, technological or legal environment in which the enterprise operates, or the market
where the assets is situated will have any significant change in the current period or in the near
future, which will cause adverse impact on the enterprise;
③The market interest rate or any other market investment return rate has risen in the current period,
and thus the discount rate of the enterprise for calculating the expected future cash flow of the assets
will be affected, which will result in great decline of the recoverable amount of the assets;
④Any evidence shows that the assets have become obsolete or have been damaged substantially;
⑤ The assets have been or will be left unused, or terminated for use, of disposed ahead of schedule;
⑥ Any evidence in the internal report of the enterprise shows that the economic performance of the
assets has been or will be lower than the expected performance, for example, the net cash flow
created by assets or the operating profit (or loss) realized is lower (higher) than the expected
amount;
⑦Other evidence indicates that the impairment of assets has probably occurred.
62
Dalian Refrigeration Co., Ltd. 2015 Annual Report
(2) The evidences to withdraw the impairment provision of long-term investment, fixed assets,
construction in process and intangible asset: at the end of the report period, the Company will
withdraw the asset impairment provision according to the difference that the recoverable amount of
single asset is less than the book value. The recoverable value shall be recognized according to the
high one between the net amount of fair value deducting disposal charge and the current value of the
expected future cash flow of assets. If the recoverable amount of the single asset cannot be obtained,
the recoverable amount shall be recognized on the basis of the asset group to which the asset
belongs.
(3) The business reputation formed by merger of enterprises shall be distributed into the related
asset group at the end of every year, then the asset group shall have the impairment test to measure
the recoverable amount, comparing to the book value, if the recoverable amount of the asset group
is less than the book amount, the difference shall first charge against the book value of the business
reputation which is apportioned to the asset group; if the book value of the business reputation is not
enough to charge against the difference, the uncharged balance shall be distributed by the other
assets of the asset group in accordance with the book value.
(4) The recognition of the asset group under impairment test: the related minimum of asset groups
that can share the synergetic benefit brought from merger through the prediction of the Company.
(5) The above impairment losses of assets cannot be reversed as soon as they are recognized.
21. Long-term amortizable expenses
The long-term amortizable expense refers to all the expenses that occurred and undertaken in the
current period or with the amortization limit of more than 1 year for the company. The long-term
amortizable expense shall be amortized within the benefit period according to the direct method.
The details are as follow:
Items Amortized years Notes
Rental expenses 30 years
Decoration expenses and etc. 3 years
22. Payroll
The payroll means that the enterprise gives various remunerations for obtaining services providing
by the employees or other relevant expenses. It includes the short-term compensation, the welfare
after demission, the demission welfare and the welfare of the long-term employees.
A.The short-term compensation
Employee compensation refers to the reward or compensation of various modes provided by the
Company which wants to receive the service offering by the employees or to execute the release of
the labor relationship. The employee compensation including the short-term salary, departure
benefits, demission benefits and other long-term employee benefits.
The short-term compensation actually happened during the accounting period when the active staff
offering the
service for the Company should be recognized as liabilities and is included in the current gains
and losses or relevant assets cost.
B.The welfare after demission
The Company divides the departure benefits plan into defined contribution plans and defined benefit
plans. Benefits plan of after demission refer to the agreement between the Company and employees
on the departure benefits, or the regulations or methods formulated by the Company for providing
welfares after demission for the employees. Of which, defined contribution plans refers to the
departure benefits plan that the Company no more undertake the further payment obligations after
the payment and deposit of the fixed expenses for the independent funds; defined benefit plans
refers to the departure benefits plan except for the defined contribution plans.
(1) Defined contribution plans
During the accounting period when providing the service for the employees, the Company will
recognize the deposited amount as the liabilities which measured by defined contribution plans and
include in the current gains and losses orthe relevant assets cost.
(2)Defined benefit plans
63
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Other long-term employee benefits the Company had not executed the defined contribution plans or
met with the conditions of defined benefit plans.
C.The demission welfare
When the Company is unable to unilaterally withdraw the plan on the cancellation of labor
relationship or the layoff proposal, or when recognizing the costs or expenses related to the
reorganization of paying the demission welfare, should recognize the payroll liabilities from the
demission welfare and include in the current gains and losses.
D.The welfare of the long-term employees
The Company provides the other long-term employee benefist for the employess, and for those met
with the defined contribution plans, should be disposed according to the above accounting polices of
the defined contribution plans; the others except for the former, should be recognized according to
above accounting polices of the defined benefit plans and measure the net liabiilties or net assets of
other long-term employee benefits.
23. Measurement method of estimated debts
A. Recognition of estimated liabilities
(1)The obligation pertinent to contingencies shall be recognized as estimated debts when the
following conditions are satisfied simultaneously:
That obligation is a current obligation of the enterprise;
(2)It is likely to cause any economic benefit to flow out of the enterprise as a result of performance
of the obligation;
(3)The amount of the obligation can be measured in a reliable way.
The Company shall check the book value of the estimated debts on the balance sheet date. If there is
any exact evidence indicating that the book value cannot really reflect the current best estimate, the
Company will adjust the book value in accordance with the current best estimate.
B. Accounting of estimated liabilities
Estimated liabilities shall be conducted initial measurement according to the best estimates of
related existing liabilities, when the company recognizes the optimum estimation, it shall be in
overall consideration of risks, uncertainty and time value of currency and other factors related to
contingent matters. When the influence of time value of money is significant, the optimum
estimates shall be determined by discounting relevant future cash outflow
The optimum estimates are conducted as follows:
If there is a continuous range (or area) for the necessary expenses and the same result possibility
within the range, the optimum estimate is recognized according to the middle value, namely the
average of upper limit and lower limit of amount within the range.
If there no exits a continuous range (or area) for the necessary expenses or the different result
possibility within the range even if there is a continuous range, and if there are contingent matters
related to individual item, the optimum estimate is recognized according to the amount that has
most possibility to occur. If there are contingent matters involving multiple items, the optimum
estimate is counted and confirmed as per all the possible results and associated probabilities.
It can be recognized separately as assets when estimated liabilities are paid by the company but can
be fully or partly compensated by a third party and the compensation mostly sure can be received,
which does not exceed the book value of estimated liabilities.
24. Share-based compensation
A.Share-based compensation types
Share-based compensation divides into equity settlement and cash settlement.
B.Determining methods for fair value of equity instruments
The fair value of equity instruments such as options granted and existing in the active market can be
determined by reference to the quotations in the active market. Otherwise, it is determined by option
pricing model, which should take into account the following factors: a. exercise prices of options;b.
validity of options; c. current prices of underlying shares; d. estimated volatility of share prices; e.
estimated dividends; f. risk-free interest rate of options within validity.
When determining the equity instruments fair value of the granted date, the company considers the
impact of the market conditions and non-vesting conditions as specified in Share-based
compensation agreements. If there are non-vesting conditions and employees or any other parties
satisfy all non-market vesting conditions (for example, service period), Share-based compensation
64
Dalian Refrigeration Co., Ltd. 2015 Annual Report
can be recognized as costs and expenses for received services.
C.Basis of best exercisable equity instruments estimate
Every balance sheet day during the vesting period, the company makes best estimate according to
the most updated number of employees that are eligible to exercise their options and adjusts the
quantity of exercisable equity instruments. On vesting dates, the final estimated quantity of
exercisable equity instruments is consistent with the actual exercisable quantity.
D.Accounting treatment for implementation, amendment and termination of share-based
compensation
Share-based compensation by equity settlement is calculated according to the fair value of granted
equity instruments. The Company can count it in costs and expenses by reference to the fair value of
the granted date and increase capital reserve accordingly if it can be exercised immediately after
being granted. If it cannot be exercised till services or performance meets the conditions during the
vesting period, then on every balance sheet date during the vesting period, received services can be
counted in related costs or expenses and capital reserve by reference to best estimates of exercisable
equity instruments quantity and its fair value of the granted date. No adjustments will be made on
already recognized costs or expenses and ownership equity after vesting dates.
For share-based compensation by cash settlement, the fair value is measured by reference to that of
the liabilities determined based the shares or other equity instruments the company undertakes. The
company can count it as costs and expenses by reference to the fair value of the granted date and
increase liabilities accordingly if it can be exercised immediately after being granted. If it cannot be
exercised till services or performance meets the conditions during the vesting period, then on every
balance sheet date during the vesting period, received services can be counted in related costs or
expenses and liabilities by reference to best estimates of exercisable equity instruments quantity and
the fair value of the liabilities the company undertakes. On every balance sheet date and settlement
date before the related liabilities are cleared, the fair value is re-calculated and the changes are
counted in current profit and loss.
E.Equity instruments changes and accounting treatment
If the granted equity instruments are cancelled during the vesting period, the company treats it as
accelerated vesting and counts in current profit and loss the amounts that should be recognized
during the rest vesting period and recognizes capital reserve accordingly at the same time. If
employees or other parties can choose but fail to satisfy non-vesting conditions during the vesting
period, the Company sees this as cancellation of granted equity instruments.
25. Revenue recognition
A.The recognition of the revenue from selling goods
The revenue from selling shall be recognized by the following conditions: The significant risks and
rewards of ownership of the goods have been transferred to the buyer by the Company; the
Company retains neither continuous management right that usually keeps relation with the
ownership nor effective control over the sold goods; the relevant amount of revenue can be
measured in a reliable way; the relevant revenue and costs of selling goods can be measured in a
reliable way.
Complete sets of engineering projects, the company selling products and building installation part
can separate and can be measured separately, will be treated as part of the sales products as selling
goods.Selling products and building installation will not be able to distinguish, or is to distinguish
but can't separate metering, will sell the product part and building installation all as building
installation part processing.
B. Giving of asset using rights
Income from giving of assets is recognized when satisfying requirements related economic benefit
flows in very possibly, income can be measured reliably.
1) Amount of interest income is calculated according to the time and actual interest rate of the
monetary capital is used by other party.
2) Income of using fee is calculated upon the charge period and calculation provided by the related
contract or agreement.
C.Labor revenues
When the results of the transaction of the company could be reliable estimated (that is the total
revenues and the total costs of labor service could be reliable measured and the completion degree
65
Dalian Refrigeration Co., Ltd. 2015 Annual Report
of the labor service could be reliable with the relevant price accounts could flow in), the company
would recognized the realization of the revenues on the settlement date according to the completion
percentage method. When the results of the transaction of the company could not be reliable
estimated, the company should recognized the revenues on the settlement date acc company ording
to the labor service cost amount which had occurred and be estimated that could be compensated
and include the happened cost in the current gains and losses.
D.Construction contracts
When the result of the construction contract is able to be evaluated reliably at the balance sheet date,
the income and cost of the contract are recognized on completion percentage basis.
If the result of the construction contract is not able to be evaluated reliably, but the contract cost
maybe recovered, the income is recognized at the cost actually recovered, and the cost of the
contract is recognized as contract expenses of the current period when it is occurred.
1) Contract progress is recognized at the ratio of accumulative actual cost on the predicted complete
cost.
2) In case the expected total cost is greater than the total income, the expected loss will be
recognized as expense of the current period. If the construction is in process, the balance is
accounted as inventory impairment provision; if the contract is not executed, the balance is
accounted as expected liability.
E.Assets transfers with buy-back conditions
If the company signs buy-back agreement with the purchase party when selling products or
transferring other assets, it should make a judgment whether the product sale satisfies revenue
recognition conditions. As buy-back after sale is financing transaction, the company does not
recognize sales revenue when delivering products or assets. During buy-back, interests are put aside
and counted in financial expenses based on the differences between buy-back and sales prices.
26. Calculation method of government grants
The government grants related to the proceeds, if those used for compensating the relevant future
expenses or losses of the enterprise shall be recognized as deferred income and shall, during the
period when the relevant expenses are recognized, recorded in the current profits and losses; or if
those used for compensating the relevant expenses or losses that have been incurred to the enterprise
shall be directly recorded in the current profits and losses.
The government grants related to the assets shall be recognized as deferred income and shall be
distributed averagely in the related asset using period, then counted into current loss and interest.
However, government subsidiary according to nominated amount shall be counted into current loss
and interest directly.
27. Deferred income tax assets/Deferred income tax liability
Deferred income tax assets and liabilities are calculated and recognized according to the differences
(temporary differences) between the taxation base of assets and liabilities and the book value. As at
balance sheet dates, both are calculated at applicable tax rates during the period it is anticipated to
take the assets back or clear the liabilities.
A.References for confirmation of deferred income tax assets
The Company recognizes the deferred tax income assets arising from deductible temporary
differences to the limit of the deductible losses and taxable income that it probably would achieve to
reduce deductible temporary differences and carry forward. However, it does not recognize those
arising from the initial measurements of assets or liabilities in the following transactions.
a.Transactions are not business merge; b.It neither affects the accounting profit nor taxable income
or deductible losses while transactions being made.
For the deductible temporary differences related to the investments by associated enterprises, which
meet the following conditions, deferred tax assets should be recognized accordingly: the temporary
differences are probable to revert in the foreseeable future and it is very likely to achieve taxable
income to deduct such differences.
B.The confirmation basis of deferred income tax liabilities
The Company recognizes the payable but not paid yet taxable temporary differences of current or
prior periods as deferred tax liabilities, which exclude the following:
(1)The temporary differences that are formed at initial measurement of goodwill;
66
Dalian Refrigeration Co., Ltd. 2015 Annual Report
(2)Non-business merge transactions or events that neither affect accounting profits nor the
temporary differences arising from taxable income (or deductible losses);
(3)The taxable temporary differences related to the investments by the subsidiaries and associated
enterprises, which can revert in a controllable timing but will not revert in the foreseeable future.
28.Lease
A.Accounting of operational leasing
(1)The leasing fees paid for the leased assets by the company shall be recorded as the current
expense according to the straight-line method in the whole lease term not excluding the rent free
period. The initially direct expense related to the lease transactions paid by the company shall be
recognized as the current expense.
When the assets lessor has assumed the lease-related expenses which should be borne by the
company, the company shall deduct these expenses from the total amount of rent, amortize in the
lease term according to the rents after deducted and record as the current expenses.
(2)The leasing fees received for the leased assets by the company shall be recognized as the lease
income according to the straight-line method in the whole lease term not excluding the rent free
period. The initially direct expense related to the lease transactions paid by the company shall be
recognized as the current expense. For a large of amount, it will be capitalized and recorded as the
current revenue based on the same confirmation of lease income during the whole lease period.
When the company has assumed the lease-related expenses which should be borne by the lessee, the
company shall deduct these expenses from the total amount of rent and amortize in the lease term
according to the rents after deducted.
B. Accounting Method for Financing Leases
(1)The assets acquired under financing leases: the lower value between the fair value of leased
assets and the present value of the minimum lease payments is recognized as the recorded value, the
minimum lease payments are recognized as the recorded value of long-term payables, and the
difference is recognized as unrecognized finance expense at the inception of the lease.
The company shall adopt the effective interest method to amortize and record as the financial costs
during the assets lease term.
(2)Finance leased assets: the company inception of the lease, the finance lease receivables, the
difference between the present value and the residual value of its unsecured recognized as
unrealized financing income recognized in the respective period of future lease rental income
received, initial direct costs related to the transaction with the rental companies, and included in the
initial measurement of the finance lease receivable and reduce the amount of revenue recognized
over the lease term.
29. Other important accounting policies and accounting estimates
Safety production expenses
The safety production expenses are drawn according to national regulations and accounted to costs
of related products and recorded to “special reserves” at the same tine. At providing of safety
expenses, expense-related costs are deducted from the special reserves. When a safety fund was
drawn and composes part of a fixed asset, they are collected under construction-in-process, and
recognized to fixed asset when the asset reaches usable status. Meanwhile, the special reserve is
deducted by the costs which compose part of the fixed asset, and accumulative depreciation is
recognized at the same amount. This fixed asset is not subject to depreciation in the future periods.
30. Changes of main accounting policies and estimates
A. Change of main accounting policies
Not applicable.
B.Change of main accounting estimates
Not applicable.
V.Taxation
1. Value added tax (‘VAT’)
The Group is subject to VAT, which is a tax charged on top of the selling price at a general rate of
17% or 13% or 6% depending on different kinds of products. An input credit is available whereby
67
Dalian Refrigeration Co., Ltd. 2015 Annual Report
VAT previously paid on purchases of raw materials and semi-finished products can be used to offset
the VAT on sales to determine the net VAT payable.
2. The business tax rate is 5% or 3% of revenue.
3. Urban maintenance and construction tax is 7% of turnover tax payable.
4. Education surtax is 3% of turnover tax payable.
5. Local education surtax is 2% of turnover tax payable.
6. House tax
For those on price basis, taxes are paid at 1.2% of the balance of original value of the property after
deducting of 30%; for those on rental basis, taxes are paid at 12% of the rental.
7.Income tax
(1)Income tax rate
Taxation on profit of subsidiaries and associates is calculated at the applicable rates in accordance
with the relevant tax regulations. Certain subsidiaries and associates enjoy preferential income tax
policies with approvals from tax authorities. The applicable income tax rates of major entities of the
group for 2015 are as follows:
Relationship with Applicable income
Names of the entities the Company tax rate in 2015
The parent company 15%
Dalian Bingshan Group Engineering Co., Ltd. Subsidiary 25%
Dalian Bingshan Group Sales Co., Ltd. Subsidiary 25%
Dalian Bingshan Metal Processing Co. Ltd. Subsidiary 25%
Dalian Bingshan Ryosetsu Quick Freezing Equipment Co., Ltd. Subsidiary 25%
Dalian Bingshan Air-conditioning Equipment Co. Ltd. Subsidiary 25%
Dalian Bingshan Guardian Automation Co., Ltd. Subsidiary 15%
Wuhan New World Refrigeration Industrial Co., Ltd. (“WNWRI”) Subsidiary 15%
Bingshan Technical Service （Dalian） Co., Ltd. Subsidiary 25%
Dalian Sanyo High-Efficient Refrigeration System Co., Ltd. Subsidiary 25%
(2)Preferential tax
The parent company was qualified as high-tech enterprises for term of three years by Dalian
Municipal Bureau of Science and Technology, Dalian Municipal Bureau of Finance, the State
Administration of Taxation Dalian Municipal Office and Dalian Local Taxation Bureau, therefore
enjoys 15% of tax for 2014-2016.
Dalian Bingshan Guardian Automation Co., Ltd.was qualified as high-tech enterprises for term of
three years by Dalian Municipal Bureau of Science and Technology, Dalian Municipal Bureau of
Finance, the State Administration of Taxation Dalian Municipal Office and Dalian Local Taxation
Bureau, therefore enjoys 15% of tax for 2015-2017.
WNWRI was qualified as high-tech enterprises for term of three years by Wuhan Municipal
Bureau of Science and Technology, Wuhan Municipal Bureau of Finance, the State Administration
of Taxation Wuhan Municipal Office and Wuhan Local Taxation Bureau, therefore enjoys 15% of
tax for 2015-2017.
(3)Other
The employees’ individual income tax were withheld by the company.
68
Dalian Refrigeration Co., Ltd. 2015 Annual Report
VI. Notes to the consolidated financial statements
1 Monetary fund
Items 31-12-2015 31-12-2014
Cash on hand 57,023.71 67,783.07
Cash in bank 224,067,110.89 457,395,413.41
Other monetary fund 20,665,689.93 51,048,269.54
Total 244,789,824.53 508,511,466.02
The restrained amount of monetary fund is shown as below
Items 31-12-2015 31-12-2014
Deposit for bank acceptances 18,503,739.86 46,780,736.99
Deposit for letter of credit 2,860,552.55
Deposit for letter of guarantee 2,161,950.07 1,406,980.00
Cash in bank for warrant of migrant workers 2,400,000.00
Total 23,065,689.93 51,048,269.54
The reason of the ending balance decreased 51.68% compared with the beginning balance was
increase of investments.
2 Notes receivable
Items 31-12-2015 31-12-2014
Bank acceptance 47,267,168.02 4,111,157.06
Trade acceptance 24,432,349.66 10,744,800.64
Total 71,699,517.68 14,855,957.70
(1) There were pledged notes receivable at the end of the current year.
Items Pledged Notes Receivable
Bank acceptance 27,361,318.86
Total 27,361,318.86
(2) The notes receivable endorsed but not matured at the end of the current year.
Items The derecognization amount Not derecognization amount
Bank acceptance 171,962,603.86
Trade acceptance 884,600.00
Total 172,847,203.86
(3) There were notes transferred to accounts receiveable at the end of the current year
Notes transferred to accounts receiveable at the end of
Items
the current year
Bank acceptance 1,644,050.00
Trade acceptance
69
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Notes transferred to accounts receiveable at the end of
Items
the current year
Total 1,644,050.00
(4) The reason of the ending balance of notes receivable increased 382.63% compared with the
beginning balance was payments for goods by notes increased.
3 Accounts receivable
(1) Classification
31-12-2015
Categories Balance Provision for doubtful debts
Book value
Amount Proportion (%) Amount Proportion (%)
Major single amount and bad
debt provision provided
individually
Bad debt provided on group
801,499,499.03 100 130,075,662.16 16.23 671,423,836.87
basis
Minor single amount but bad
debt provision provided
individually
Total 801,499,499.03 100 130,075,662.16 16.23 671,423,836.87
Continued:
31-12-2014
Categories Balance Provision for doubtful debts
Book value
Amount Proportion (%) Amount Proportion (%)
Major single amount and bad
debt provision provided
individually
Bad debt provided on group
555,119,550.49 100 116,238,720.37 20.94 438,880,830.12
basis
Minor single amount but bad
debt provision provided
individually
Total 555,119,550.49 100 116,238,720.37 20.94 438,880,830.12
Accounts receivable which bad debt provisions are provided on ages basis in the group
31-12-2015
Account ages
Amount Provision for bad debts Proportion rates (%)
Within 1 year 500,866,264.92 25,043,313.34 5
1 to 2 years 145,419,155.77 14,541,915.58 10
2 to 3 years 54,784,001.81 16,435,200.54 30
3 to 4 years 45,125,215.48 22,562,607.74 50
4 to 5 years 19,061,180.44 15,248,944.35 80
70
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Over 5 years 36,243,680.61 36,243,680.61 100
Total 801,499,499.03 130,075,662.16
(2) Provision for bad debts accrued, regain or switch back in the period
In the current period, RMB16,302,352.17 were accrued provision for bad debts, and RMB74,884.50
were regained.
Receivable accounts written off before but regained during the current year:
Companies Received amount Regained form Notes
Linan Fengye Food Co., Ltd. 23,453.00 Bank deposits Paid by court decision
Wuxi Jiuheng Electromechanical Equipment
5,850.00 Bank deposits Keeping Collection
Co., Ltd.
Shandong Dongyue Polymer Material Co.,Ltd. 7,581.50 Bank deposits Keeping Collection
Shandong Qilu Chemical Co., Ltd. 38,000.00 Bank deposits Keeping Collection
Total 74,884.50
(3) Accounts receivable being writen-off during the current period
Items Written off amount
36 Clients 3,994,506.12
The reasons of accounts receivable of the company and Dalian Bingshan Air-conditioning
Equipment Co. Ltd.being writen-off mainly include termination of operation and disability of
payment, small balance being not collected for long time, and disagreement rework charges etc, and
the accounts receivable being writen-off during the current period was permitted by the board of
directors.
(4) Top 5 on amount of accounts receivable
Provision for
Companies Amount Proportion (%)
bad debts
Beijing Huashang Bingshan Refrigeration and Air-conditioning
40,803,001.99 5.09 2,093,750.10
Machinery Co., Ltd.
Shenyang Railway Bureau Dalian Engineering Construction
39,671,502.00 4.95 1,983,575.10
Headquarter
Shandong Changhua Food Science Co., Ltd. 16,025,000.00 2.00 801,250.00
Yunnan Binghai Investment Co., Ltd. 13,917,500.00 1.74 695,875.00
Beidahuang Taihua Organic Foods Co., Ltd. 9,068,326.88 1.13 453,416.34
119,485,330.8
Total 14.91 6,027,866.54
7
(5) The reason of the ending balance of accounts receivable increased 52.99% compared with the
beginning balance was accounts receivable aging within 1 year increased.
4 Advances to suppliers
(1) The aging of advances to suppliers
31-12-2015 31-12-2014
Account ages
Amount Proportion (%) Amount Proportion (%)
Within 1 year 40,798,252.80 92.26 18,897,672.41 99.18
1 to 2 years 3,420,635.11 7.74 121,597.34 0.64
2 to 3 years 6,000.00 0.03
71
Dalian Refrigeration Co., Ltd. 2015 Annual Report
3 to 4 years 28,000.00 0.15
Total 44,218,887.91 100 19,053,269.75 100
(2)Top 5 on amount of advances to suppliers
Companies Amount Proportion (%) Ages Reasons
Prepayment for
Dalian Bingshan Engineering & Trading Co., Ltd. 18,068,922.66 40.86 2015
goods
Shandong Tianbao Air Heat PumpTechnology Prepayment for
4,024,564.80 9.10 2015
Co., Ltd. goods
Prepayment for
Jiahua Chemistryl Co.,Ltd. 2,213,661.30 5.01 2014/2015
goods
Heilongjiang Dazhou Refrigeration Equipment Prepayment for
1,984,600.00 4.49 2014/2015
Co.,Ltd. goods
Natuional Grid Liaoning Power Co.,Ltd. Dalian Prepayment for
1,862,304.71 4.21 2015
Power Supply Company goods
Total 28,154,053.47 63.67
(3) The reason of the ending balance of advances to suppliers increased 132.08% compared with the
beginning balance was amounts advance paid for projects increased.
5 Interest receivable
Items 31-12-2015 31-12-2014
Interest on Term Deposits 4,998,982.40
Total 4,998,982.40
The reason of the ending balance of interest receivable decreased 100% compared with the beginning
balance was interest recieved.
6 Dividends receivable
Name 31-12-2015 31-12-2014
Wuhan Steel and Electricity Co., Ltd. 44,600.00
Total 44,600.00
The reason of the ending balance of dividends receivable increased 100% compared with the
beginning balance was interest not yet due.
7 Other accounts receivable
(1) Classification
31-12-2015
Items Balance Provision for doubtful debts
Book value
Proportion Proportion
Amount Amount
(%) (%)
Major single amount and bad
debt provision provided
individually
72
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Bad debt provided on group basis 28,070,768.44 100 5,315,440.23 18.94 22,755,328.21
Minor single amount but bad debt
provision provided individually
Total 28,070,768.44 100 5,315,440.23 18.94 22,755,328.21
Continued：
31-12-2014
Items Balance Provision for doubtful debts
Book value
Proportion
Amount Proportion (%) Amount
(%)
Major single amount and bad
debt provision provided
individually
Bad debt provided on group basis 39,244,121.02 100 4,977,677.00 12.68 34,266,444.02
Minor single amount but bad debt
provision provided individually
Total 39,244,121.02 100 4,977,677.00 12.68 34,266,444.02
There is no major single amount and bad debt provision provided individually.
Other accounts receivable which bad debt provisions are provided on age basis.
31-12-2015
Account ages
Amount Provision for bad debts Proportion rates (%)
Within 1year 11,509,483.15 575,474.15 5
1 to 2 years 11,036,450.75 1,103,645.08 10
2 to 3 years 1,532,283.28 459,684.98 30
3 to 4 years 1,329,402.20 664,701.10 50
4 to 5 years 756,070.71 604,856.57 80
Over 5 years 1,907,078.35 1,907,078.35 100
Total 28,070,768.44 5,315,440.23
(2) Provision for bad debts accrued, regain or switch back in the period
In the current period, RMB343,990.07 were accrued provision for bad debts, and RMB 5361.66
provision for bad debts increased by change of consolidation scope.
(3) The write-off of other accounts receivable during the current year
Items Written off amounts
2 Clients 11,588.50
The write-off other accounts receivable was written off because of not being collected for long time and
not being connected.
(4) The nature of other accounts receivable
Items 31-12-2015 31-12-2014
Guarantee deposits 15,948,041.08 25,442,507.63
Petty cash 5,883,732.14 4,758,015.42
To or fro accounts 1,382,402.17 3,954,641.30
Prepayments over settlement periods 2,624,627.12 4,047,765.86
73
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Items 31-12-2015 31-12-2014
Others 2,231,965.93 1,041,190.81
Total 28,070,768.44 39,244,121.02
(5) Top 5 on amount of other accounts receivable
Proportion Provision for
Companies Contents Amount Ages
(%) bad debts
Dalian Tianbao Green Foods Performance
8,000,000.00 1-2 years 28.50 800,000.00
Co., Ltd. bonds
Less than 1
Dalian Jinzhou District
Guarantee year ，1-2
Building Energy Save 1,852,574.57 6.60 315,242.86
deposits years,2-3 years，
Administration Office
4-5 years
Balikun Jiankun Animal Performance
1,266,561.00 Less than 1 year 4.51 63,328.05
Husbandry Co., Ltd. bonds
Tianjin Construction Team
Wage depodits of
Comunication and Service 1,000,000.00 Over 5 years 3.56 1,000,000.00
migrant workers
Center
Dalian Construction Project
Wage depodits of
Labour Insurance Expenses 500,000.00 2-3 years 1.78 150,000.00
migrant workers
Administration Center
Total 12,619,135.57 44.95 2,328,570.91
(6) The reason of the ending balance of other accounts receivable decreased 33.59% compared
with the beginning balance was guarantee deposits decreased.
8 Inventories
(1) Costs
31-12-2015 31-12-2014
Items
Provision for Provision for
Book balance impairment of Book value Book balance impairment of Book value
inventories inventories
Raw materials 65,069,599.90 6,954,631.11 58,114,968.79 51,805,680.92 7,463,862.07 44,341,818.85
Materials on
consignment for 2,190,375.70 2,190,375.70 2,394,839.67 2,394,839.67
further processing
Low-value
134,671.91 134,671.91 81,422.57 81,422.57
consumptions
Work-in-progress 71,830,972.13 1,148,743.24 70,682,228.89 81,736,391.62 1,192,940.12 80,543,451.50
Self-manufactured
semi-finished 30,014,321.83 1,386,950.94 28,627,370.89 27,189,545.15 2,532,083.34 24,657,461.81
products
121,961,126.0
Finished goods 74,379,267.69 2,588,149.42 71,791,118.27 124,845,367.55 2,884,241.52
3
Constructing projects 27,558,415.02 27,558,415.02 40,898,986.13 40,898,986.13
Total 271,177,624.18 12,078,474.71 259,099,149.47 328,952,233.61 14,073,127.05 314,879,106.56
(2) Provision for impairment of inventories
74
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Current year addition Current year disposal
Items 31-12-2014 31-12-2015
Provision Others Reversal Written-off Others
Finished goods 2,884,241.52 477,284.08 773,376.18 2,588,149.42
Raw materials 7,463,862.07 509,230.96 6,954,631.11
Work-in-progress 1,192,940.12 44,196.88 1,148,743.24
Self-manufactured
2,532,083.34 1,145,132.40 1,386,950.94
semi-finished products
Total 14,073,127.05 477,284.08 2,471,936.42 12,078,474.71
(3) At the end of current period, the company tested inventories and withdrew provision for the
difference between the cost and the lower net realizable value.
9 Other current assets
Items 31-12-2015 31-12-2014
Enterprise income tax prepaid 2,628,292.68 1,400,309.96
Withholdings on VAT 13,779,722.47
Prepaid expenses 70,696.71 934,829.83
Total 16,478,711.86 2,335,139.79
The reason of the ending balance of other current accounts increased 605.68% compared with the
beginning balance was withholdings on VAT shifted from taxes payable.
10 Available for sale financial assets
31-12-2015 31-12-2014
Items Provision for Provision for
Book balance Book value Book balance Book value
impairment impairment
Debt instruments
available for sale
Equity instruments
available for sale
Measured by fair
720,945,755.39 1,582,164.89 719,363,590.50
value
Measured by cost 17,554,264.50 3,642,605.91 13,911,658.59 47,653,159.50 5,224,770.80 42,428,388.70
Others
Total 738,500,019.89 5,224,770.80 733,275,249.09 47,653,159.50 5,224,770.80 42,428,388.70
(1) Equity instruments available for sale measured by fair value at the end of current year
Equity instruments Debt instruments
Items Others Total
available for sale available for sale
Cost 30,098,895.00 30,098,895.00
Accumuilated other comprehensive income 587,219,831.33 587,219,831.33
Deferred income tax liabilities 103,627,029.06 103,627,029.06
Less：provision 1,582,164.89 1,582,164.89
Fair value 719,363,590.50 719,363,590.50
(2)Equity instruments available for sale measured by cost at the end of current year
Shareholdin Book balance
Names
g Beginning Increased Decreased Ending
75
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Names Shareholdin Book balance
g balance during current during current balance
year year
Liaoning Mike Group Co., Ltd. 3.57% 1,020,000.00 1,020,000.00
Guotai Junan Securities Co., Ltd. 0.49% 30,098,895.00 30,098,895.00
Guotai Junan Investment
0.22% 3,057,316.00 3,057,316.00
Management Co., Ltd.
Thermo King Container
Temperature Control (Suzhou) 17.8% 11,207,806.00 11,207,806.00
Co., Ltd.
Wuhan Steel and Electric Co.,
0.056% 1,315,142.50 1,315,142.50
Ltd.
Liaoning Enterprises United
4.2% 105,000.00 105,000.00
Industry Company
Zibo Traction Motor Co., Ltd. 0.76% 849,000.00 849,000.00
Total 47,653,159.50 30,098,895.00 17,554,264.50
Continued：
Provision for impairment Cash
Increased Decreased dividends
Names Beginning Ending
during during current during the
balance balance current period
current year year
Liaoning Mike Group Co., Ltd. 310,000.00
Guotai Junan Securities Co., Ltd. 1,582,164.89 1,582,164.89
Guotai Junan Investment Management
2,688,605.91 2,688,605.91
Co., Ltd.
Thermo King Container Temperature
Control (Suzhou) Co., Ltd.
Wuhan Steel and Electric Co., Ltd.
Liaoning Enterprises United Industry
105,000.00 105,000.00
Company
Zibo Traction Motor Co., Ltd. 849,000.00 849,000.00
Total 5,224,770.80 1,582,164.89 3,642,605.91
(3) Changes of the impairment of the available-for-sale financial assets during the current year
Equity instruments available for Debt instruments available
Items Others Total
sale for sale
Beginning balance 5,224,770.80 5,224,770.80
Increased during current year
Included transfer from other
comprehensive income
Decreased during current year
Included transfer from fair
value rising
Ending balance 5,224,770.80 5,224,770.80
(4) Relevant notes of the fair value of the available-for-sale equity instruments
Guotai Junan Securities Co., Ltd. was listed by Shanghai Security Exchange on 26 June 2015,and
the company held its stock 30,098,895 shares and measured by fair value at the end of current
year.The company received its cash dividend RMB 3,009,889.50 during the current year.
The reason of the ending balance of the available-for-sale financial assets increased 1,628.27%
compared with the beginning balance was the share of Guotai Junan Securities Co., Ltd. was listed
by Shanghai Security Exchange and measured by fair value at the end of current year.
76
Dalian Refrigeration Co., Ltd. 2015 Annual Report
11 Long-term equity investments
Increase/Decrease
Provisi
Beginning Gains and losses Adjustment Cash bonus or Provision for on for
Name Changes Ending balance
balance Decrease recognized of other profits impairment of impair
Increased of other Others
d under the equity comprehensiv announced to the current ment
equity
method e income issue period
ⅠJoint venture
Dalian Bingshan – P&A
Recreation Development 3,553,919.97 -716,822.16 2,837,097.81
Engineering Co., Ltd.
subtotal 3,553,919.97 -716,822.16 2,837,097.81
Ⅱ Associates
Dalian Bingshan International
13,716,985.57 1,974,116.05 15,691,101.62
Trading Co.,Ltd.
Panasonic Refrigeration
155,826,086.27 8,600,021.37 5,200,000.00 159,226,107.64
(Dalian) Co., Ltd.
Dalian Honjo Chemical Co.,
9,403,913.18 528,860.67 1,203,061.37 8,729,712.48
Ltd.
Panasonic Cold-Chain
215,573,606.48 8,145,919.40 8,000,000.00 215,719,525.88
(Dalian) Co., Ltd.
Keinin-Grand Ocean Thermal
Technology (Dalian) Co., 42,333,942.39 15,873,092.90 9,600,000.00 48,607,035.29
Ltd.
Panasonic Compressor
432,515,006.40 59,377,362.52 34,000,000.00 457,892,368.92
(Dalian) Co., Ltd.
Dalian Sanyo Meica
23,233,848.71 -1,275,779.47 21,958,069.24
Electronics Co., Ltd.
MHI Bingshan Refrigeration
29,294,087.63 -7,017,754.79 22,276,332.84
(Dalian) Co.,Ltd.
Beijing Huashang Bingshan
Refrigeration and
1,425,989.62 1,754,200.00 -1,243,542.64 1,936,646.98
Air-conditioning Machinery
Co., Ltd.
Dalian Fuji Bingshan Vending
89,896,843.61 28,686,407.19 5,314,796.52 113,268,454.28
Machine Co., Ltd.
77
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Increase/Decrease
Provisi
Beginning Gains and losses Adjustment Cash bonus or Provision for on for
Name Changes Ending balance
balance Decrease recognized of other profits impairment of impair
Increased of other Others
d under the equity comprehensiv announced to the current ment
equity
method e income issue period
Daliian Sanyo High-Efficient
-48,287,5
Refrigeration System Co., 22,455,509.02 26,993,388.94 -1,161,308.18
89.78
Ltd.
Changzhou Jingxue
130,000,000.0
Refrigeration Equipment Co., 11,722,024.61 141,722,024.61
0
Ltd.
Dalian Fuji Bingshan Vending
2,450,000.00 2,044,158.79 2,256.74 4,496,415.53
Machine Co., Ltd.
Wuhan Lanning Energy
6,000,000.00 6,874.61 6,006,874.61
Science Co., Ltd.
-48,287,589.7
subtotal 1,035,675,818.88 167,197,588.94 126,260,453.03 2,256.74 63,317,857.89
8
1,217,530,669.92
-48,287,589.7
Total 1,039,229,738.85 167,197,588.94 125,543,630.87 2,256.74 63,317,857.89
8
1,220,367,767.73
(1) On 27th January, 2015, the Company’s Board of Directors decided to increase investment of RMB7,160,000.00 to Beijing Huashang Bingshan Refrigeration and Air-conditioning
Machinery Co., Ltd and increased investment of RMB1,754,200.00 during year of 2015.The shareholders’ investment proportion remained unchanged.
(2) According to the 17th meeting of the 6th session of the Company’s Board of Directors, the Company was transferred 30% shareholdings of Daliian Sanyo High-Efficient Refrigeration
System Co., Ltd., and the transfer price was RMB26,993,388.94.The company held 55% shareholdings of Daliian Sanyo High-Efficient Refrigeration System Co., Ltd.as at the end of year 2015.
(3) According to the 19th meeting of the 6th session of the Company’s Board of Directors, the Company was transferred 29.212% shareholdings of Changzhou Jingxue Refrigeration
Equipment Co., Ltd.with the price of RMB130,000,000.00.The equityas at the transaction was finished as at the end of year 2015.
(4) On 31st October, 2014, the Company’s Board of Directors decided to establish the join-venture Dalian Fuji Bingshan Vending Machine Co., Ltd. with Japan Fuji Electric Co., Ltd. The
company invested RMB 2,450,000.00 and held 49% equity. Dalian Fuji Bingshan Vending Machine Co., Ltd. operated normally at the end of year 2015.
(5) The Board of Directors of Wuhan New World Refrigeration Industrial Co., Ltd. (“WNWRI”) decided to establish the join-venture Wuhan Lanning Energy Science Co., Ltd. with Xi’an
Qitong Energy Technology Co., Ltd. and Wu Zhihong and Cheng Xiangrong. WNWRI invested RMB6,000,000.00 and held 27.27% equity. Wuhan Lanning Energy Science Co., Ltd.
operated normally at the end of year 2015.
78
Dalian Refrigeration Co., Ltd. 2015 Annual Report
12 Investment property
(1)Investment property details
Construction
Items Buildings Land-use-rights Total
in progress
1. Original value
(1)Beginning balance 25,259,944.57 25,259,944.57
(2)Current year addition
Outsourcing
Transferred from I nventories\Fixed
asset-original cost\Construction in
progress
Enterprise merger increase
Shareholders invest
Transferred from other
(3)Current year disposal
disposal
Transferred to other
(4)Ending balance 25,259,944.57 25,259,944.57
2.Accumulated depreciation
(1)Beginning balance 151,035.57 151,035.57
(2)Current year addition 611,325.00 611,325.00
provision or amortization 611,325.00 611,325.00
Enterprise merger increase
Transferred from other
(3)Current year disposal
disposal
Transferred to other
(4)Ending balance 762,360.57 762,360.57
3..Provision for impairment
(1)Beginning balance
(2)Current year addition
provision or amortization
Enterprise merger increase
Transferred from other
(3)Current year disposal
disposal
Transferred to other
(4)Ending balance
4.Book value
(1)Ending.Book value 24,497,584.00 24,497,584.00
(2)Beginning.Book value 25,108,909.00 25,108,909.00
(2) Investment property without owner’s certificates
79
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Items Book value Reasons
# 6 workshop building on No. 106 Liaohe East Rd, Dalian
24,497,584.00 Final accounts uncompleted
Economic and Technology Development Zone
Total 24,497,584.00
(3) Explanation of investment property
On 31st July,2014, the company signed rental contract with MHI Bingshan Refrigeration (Dalian)
Co.,Ltd., and rent # 6 workshop building located on No. 106 Liaohe East Rd, Dalian Economic and
Technology Development Zone to MHI Bingshan Refrigeration (Dalian) Co.,Ltd. The rental area is
15,259.04 square metres, and annual rent is RMB 4.2 million since 15th August, 2014 to 16th July,
2029.
13 Fixed assets
(1) Fixed assets details
Other
Items Buildings Machinery Vehicles Total
equipments
1. Original value
351,970,071.3
(1)Beginning balance 568,188,704.97 25,291,805.92 18,442,757.75 963,893,340.00
6
(2)Current year addition 58,672,776.25 41,027,759.55 1,898,059.32 11,337,061.95 112,935,657.07
Purchased 2,840,310.33 5,226,907.04 1,138,294.88 2,454,249.47 11,659,761.72
Transferred from
19,215,338.06 7,366,023.14 302,544.44 26,883,905.64
Construction in progress
Enterprises merger 36,617,127.86 28,434,829.37 457,220.00 8,872,128.72 74,381,305.95
Shareholders investment
Leased in from financing
Other transferred in 10,683.76 10,683.76
(3)Current year reduction 89,690.00 1,085,989.40 1,839,706.89 166,807.21 3,182,193.50
Disposal 89,690.00 1,075,305.64 1,839,706.89 166,807.21 3,171,509.74
Leased out from financing
Other transferred out 10,683.76 10,683.76
410,553,157.6
(4)Ending balance 608,130,475.12 25,350,158.35 29,613,012.49 1,073,646,803.57
1
2.Accumulated depreciation
121,972,177.3
(1)Beginning balance 397,048,925.70 14,903,060.69 13,383,677.27 547,307,840.97
1
(2)Current year addition 22,341,121.11 43,869,446.65 2,422,979.83 7,983,979.68 76,617,527.27
Provision 9,179,716.36 25,109,608.86 2,011,481.83 1,423,804.82 37,724,611.87
Enterprises merger
13,161,404.75 18,759,837.79 411,498.00 6,558,137.38 38,890,877.92
increased
Other transferred in 2,037.48 2,037.48
(3)Current year disposal 80,721.00 954,550.77 1,301,353.86 141,599.08 2,478,224.71
Disposal 80,721.00 952,513.29 1,301,353.86 141,599.08 2,476,187.23
Leased out from financing
Other transferred out 2,037.48 2,037.48
144,232,577.4
(4)Ending balance 439,963,821.58 16,024,686.66 21,226,057.87 621,447,143.53
2
3..Provision for impairment
80
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Other
Items Buildings Machinery Vehicles Total
equipments
(1)Beginning balance 2,292,229.72 2,292,229.72
(2)Current year addition
Withdrew
Enterprises merger
increase
Other transferred in
(3)Current year disposal
Disposal
Leased out from financing
Other transferred out
(4)Ending balance 2,292,229.72 2,292,229.72
4.Net Book value
266,320,580.1
(1)Ending book value 165,874,423.82 9,325,471.69 8,386,954.62 449,907,430.32
9
229,997,894.0
(2)Beginning book value 168,847,549.55 10,388,745.23 5,059,080.48 414,293,269.31
5
(2)There were no idle fixed assets during the current period.
(3) Fixed assets without owner’s certificates
Items Book value Reasons
Final settlement accounts
Buildings 80,177,930.97
uncompleted
Total 80,177,930.97
(4) Wuhan New World Refrigeration Industrial Co., Ltd. borrowed RMB55,000,000 from bank and
mortgaged with its buildings ,machinery and land-use-rights. Please refer to the note Ⅴ.19.Except
this the company’s fixed assets were not replaced or mortgaged.
14 Project in construction
(1)Details
Other
Transferred decreas Percentag
Increased
Balance of into fixed ed Balance of Sources of e of
Items Budgets during current
31-12-2014 assets during during 31-12-2015 funds completio
year
current year current n
year
Buildings Internally
renovatio 301,450,000 17,594,050.11 136,878,462.92 19,215,338.06 135,257,174.97 generated 45%
n funds
Internally
Machiner
171,840,000 921,399.35 8,212,833.40 7,366,023.14 1,768,209.61 generated 5%
y
funds
Vehicles 302,544.44 302,544.44
Total 473,290,000 18,515,449.46 145,393,840.76 26,883,905.64 137,025,384.58
(2) No interests capitalized during the current period.
(3) There was no provision for impairment needed withdrawn.
(4) The reason of the ending balance increased 640.06% compared with the beginning balance was
construction of the new factory increased .
81
Dalian Refrigeration Co., Ltd. 2015 Annual Report
15 Intangible assets
(1) Intangible assets details
Items Land-use-rights Knowhow Others Total
1. Original value
(1)Beginning balance 176,504,398.53 515,224.41 10,023,747.44 187,043,370.38
(2)Current year addition 7,459,504.09 3,863,235.58 11,322,739.67
Purchase 2,946,949.54 2,946,949.54
Internal research and
development
Enterprises merger increase 7,459,504.09 916,286.04 8,375,790.13
Shareholders invest
Other transferred in
(3)Current year disposal
Disposal
Other transferred out
(4)Ending balance 183,963,902.62 515,224.41 13,886,983.02 198,366,110.05
2. Amortization
(1)Beginning balance 28,866,655.89 515,224.41 3,748,179.83 33,130,060.13
(2)Current year addition 5,208,475.78 1,609,771.57 6,818,247.35
Provision 3,607,790.69 900,165.74 4,507,956.43
Enterprises merger increase 1,600,685.09 709,605.83 2,310,290.92
Other transferred in
(3)Current year disposal
Disposal
Other transferred out
(4)Ending balance 34,075,131.67 515,224.41 5,357,951.40 39,948,307.48
3..Provision for impairment
(1)Beginning balance
(2)Current year addition
Withdraw
Enterprises merger increase
Other transferred in
(3)Current year disposal
Disposal
Other transferred out
(4)Ending balance
4.Net book value
(1)Ending book value 149,888,770.95 8,529,031.62 158,417,802.57
(2)Beginning book value 147,637,742.64 6,275,567.61 153,913,310.25
(2) There was no Intangible assets increased by internal research and development .
82
Dalian Refrigeration Co., Ltd. 2015 Annual Report
(3) Please refer to the note Ⅴ.19 for land-use-rights mortgaged by Wuhan New World Refrigeration
Industrial Co., Ltd.
16 Goodwill
Increased during current Dreased during current
year year
Name 31-12-2014 31-12-2015
Enterprises merger
Other Disposal Other
increase
Daliian Sanyo
High-Efficient
1,440,347.92 1,440,347.92
Refrigeration System
Co., Ltd
Total 1,440,347.92 1,440,347.92
The Company acquired 30% shares of Daliian Sanyo High-Efficient Refrigeration System Co., Ltd.
on 31 July,2015 with consideration of RMB26,993,388.94. On the date of acquisition, the difference
with the fair value of identifiable net assets of Daliian Sanyo High-Efficient Refrigeration System
Co., Ltd. was RMB1,440,347.92, and treated as goodwill in the consolidated financial statements.
At the end of 2015, it carried out the impairment test for the goodwill. The recoverable amount was
not lower than its book value, and there was no goodwill impairment withdrawn.
17 Long-term deferred expenses
Increased Amortized
Other
Items 31-12-2014 during current during current 31-12-2015
decrease
year year
Employee’s dormitory use right 2,704,561.98 138,478.32 2,566,083.66
Renovation and rebuilding 3,085,642.38 1,291,518.48 1,794,123.90
Inspection services 83,194.63 48,507.24 34,687.39
Membership fee of golf club 512,875.00 6,875.00 506,000.00
Rental expenses 1,062,900.00 106,290.00 956,610.00
Total 5,873,398.99 1,575,775.00 1,591,669.04 5,857,504.95
18 Deferred income tax assets and deferred income tax liabilities
(1) Deferred income tax assets had not been off-set
31-12-2015 31-12-2014
Items Deductible Deductible
Deferred tax
temporary Deferred tax assets temporary
difference liabilities
difference
Provision for assets impairment 107,112,240.49 19,372,358.73 98,014,616.89 16,786,587.33
Stock option Incentive expenses 12,190,520.00 1,828,578.00
Total 119,302,760.49 21,200,936.73 98,014,616.89 16,786,587.33
(2) Temporary difference which not recognized deferred income tax assets
Items 31-12-2015 31-12-2014
Provision for impairment 47,874,337.13 44,791,908.06
83
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Items 31-12-2015 31-12-2014
Deductible losses 15,856,452.86 9,725,928.72
Total 63,730,789.99 54,517,836.78
The temporary difference was not recognized as deferred income tax assets, because it is uncertain
if there will be enough taxable income.
(3) Deductible losses of unrecognized deferred income tax assets will due the following years
Items 31-12-2015 31-12-2014 Notes
2017 975,555.72 975,555.72
2018 2,350,012.09 4,717,859.29
2019 4,032,513.71 4,032,513.71
2020 8,498,371.34
Total 15,856,452.86 9,725,928.72
(4) Deferred income tax liabilities before offsetting
31-12-2015 31-12-2014
Items Taxable temporary Taxable temporary Deferred tax
difference Deferred tax assets
difference liabilities
Fair value changes of
690,846,860.39 103,627,029.06
available-for-sale financial assets
Total 690,846,860.39 103,627,029.06
19 Short-term loans
Terms of loans 31-12-2015 31-12-2014
Mortgage loan 55,000,000.00 60,000,000.00
Fiduciary loan 27,600,000.00
Total 82,600,000.00 60,000,000.00
(1) Wuhan New World Refrigeration Industrial Co., Ltd. borrowed short-term loan RMB55,000,000
from bank and mortgaged with its buildings, machinery and land-use-rights.
(2) The reason of the ending balance increased 37.67% compared with the beginning balance was
fiduciary loan increased.
20 Notes payable
Items 31-12-2015 31-12-2014
Bank acceptance notes 203,432,038.63 103,304,788.06
Trade acceptance notes 30,756,973.09 6,241,714.55
Total 234,189,011.72 109,546,502.61
The reason of the ending balance increased 113.78% compared with the beginning balance was
settlement of purchases by notes payable increased.
21 Accounts payable
Items 31-12-2015 31-12-2014
Payable for materials 554,938,956.23 475,503,139.38
84
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Payable for projects 103,608,705.86 6,919,723.26
Payable for equipments 1,850,841.17 28,653,675.18
Total 660,398,503.26 511,076,537.82
There was no big amount among the accounts payable aged more than 1 year.
22 Accounts received in advance
(1) Details
Items 31-12-2015 31-12-2014
Advances on sales 70,458,014.46 137,629,315.42
Total 70,458,014.46 137,629,315.42
(2) Accounts received in advance aged over 1 year
Items 31-12-2015 Reasons
China Aviation Planning and Construction
3,100,000.00 Unsettled contract payments on sets projects
Development Co., Ltd.
Jiangsu Ruixiang Chemical Engineering Co.,
2,023,581.40 Unsettled contract payments on sets projects
Ltd.
Inner Mongolia Datang Dingwang Chemical
1,962,400.00 Unsettled contract payments on sets projects
Engineering Co., Ltd.
Total 7,085,981.40
(3) The reason of the ending balance decreased 48.81% compared with the beginning balance was
accounts received in advance carried down to income increased.
23 Payroll payable
(1) Details
Increased during Decreased during
Items 31-12-2014 31-12-2015
current year current year
Short-term salary 55,993,637.27 253,154,322.75 257,290,614.73 51,857,345.29
Departure welfare-defined
33,589,386.22 33,589,386.22
contribution plans
Termination benefits 331,302.30 331,302.30
Other welfare due within 1
year
Total 55,993,637.27 287,075,011.27 291,211,303.25 51,857,345.29
(2)Short-term salary
Increased Decreased
Items 31-12-2014 during current during current 31-12-2015
year year
1.Wages and salaries, bonuses, allowances
25,570,229.67 208,089,719.04 200,463,842.85 33,196,105.86
and subsidies
2.Staff welfare 25,205,874.20 8,309,358.97 18,104,168.97 15,411,064.20
3.Social insurance 1,698,790.15 13,545,227.73 14,597,466.66 646,551.22
Including： ①Medical insurance 11,527,080.01 11,527,056.01 24.00
85
Dalian Refrigeration Co., Ltd. 2015 Annual Report
②supplementary
medical insurance
③Work-related injury insurance 945,944.69 945,943.88 0.81
④Matemity insurance 454,649.73 454,649.73
⑤Housing subsidies 1,698,790.15 617,553.30 1,669,817.04 646,526.41
4. Housing funds 2,466,435.12 19,165,080.60 19,714,079.14 1,917,436.58
5.Labor union fund and employee education
1,052,308.13 3,676,572.41 4,042,693.11 686,187.43
fee
6. Non-monetary welfare 368,364.00 368,364.00
Total 55,993,637.27 253,154,322.75 257,290,614.73 51,857,345.29
The non- monetary welfare of the current year was amortization of long-term expenses of
employees’ dormitory use right, dining hall expenses and etc.
(3) Defined contribution plans
Increased during Decreased during
Items 31-12-2014 31-12-2015
current year current year
Basic retirement pension 28,928,203.69 28,928,203.69
Unemployment
1,531,109.20 1,531,109.20
insurance
Heating fees 3,130,073.33 3,130,073.33
Total 33,589,386.22 33,589,386.22
The company took part in the government’s basic retirement pension and unemployment insurance according to the
related legislation, and paid the insurance charges every month and recorded as expenses or costs of assets. There
was no other obligation of payment.
(4)There was no amount delay paid at the end of the current year.
24 Taxes payable
Items 31-12-2015 31-12-2014
Value-added tax 6,680,785.40 -3,127,955.12
Business tax 1,621,471.10 1,991,177.27
Enterprise income tax 4,876,229.11 2,568,733.67
Individual income tax 394,393.08 396,325.29
City maintenance and construction tax 722,295.23 291,424.15
Building taxes 233,857.61
Land use tax 553,224.98 217,274.87
Education surtax 247,975.64 110,082.07
Local education surtax 195,855.11 67,685.90
Water project fund/River route maintenance fee 7,682.90 11,139.52
Safeguard fund for disables 680.00 544.00
Dike maintenance fee 13,509.20
Stamp duty 167,128.20 102,788.87
Total 15,701,578.36 2,642,729.69
86
Dalian Refrigeration Co., Ltd. 2015 Annual Report
The reason of the ending balance Increased 494.14% compared with the beginning balance was
withholdings on VAT shifted from taxes payable to other current assets.
25 Dividend payable
Name of investors 31-12-2015 31-12-2014 Reasons
Legal person shareholders 533,156.00 533,156.00 Some shareholders not claimed.
Total 533,156.00 533,156.00
26 Other accounts payable
(1) Details
Items 31-12-2015 31-12-2014
Obligation of restricted shares
39,503,800.00
buy-back
Loan from non-financial institutes 18,200,000.00 18,096,524.00
Cash pledge and security deposit 14,199,502.52 13,721,523.03
Apply for reimbursement and unpaid 17,038,250.51 14,117,136.22
Cash from related parties 627,014.92 510,097.66
Receipts under custody 9,255,791.05 11,164,903.53
Others 1,065,931.15 2,465,629.60
Total 99,890,290.15 60,075,814.04
(2) Major amount aging over 1 year
Name of investors 31-12-2015 Unpaid reason
Dalian Bingshan Group Subsidiary company borrowed for removal and
10,000,000.00
Co., Ltd. reconstruction
Total 10,000,000.00
The reason of the ending balance increased 66.27% compared with the beginning balance was
obligation of restricted shares buy-back confirmed.
27 Deferred revenue
Increased
Decreased during
Items 31-12-2014 during current 31-12-2015 Reasons
current year
year
Associated with assets 51,077,394.00 1,699,098.00 49,378,296.00
Associated with earnings 1,696,490.19 1,696,490.19
Total 52,773,884.19 3,395,588.19 49,378,296.00
Subsidy from government
87
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Converted to
Increased
non-business Other
Liabilities 31-12-2014 during 31-12-2015 Notes
incomes during decrease
current year
current year
Subsidy fund for
Associated
highly effective heat
585,098.00 3,704,296.00 with the
pump and related 4,289,394.00
asset
system
Contribution to Associated
subsidiary company 46,788,000.00 1,114,000.00 45,674,000.00 with the
relocation asset
Big capacity of sea
Associated
water pre-freeze
1,696,490.19 with
project of Project 1,696,490.19
earnings
863
Total 52,773,884.19 3,395,588.19 49,378,296.00
28 Share capitals
Shares
Issuance of
Items 31-12-2014 converted Others 31-12-2015
new shares
from reserve
I. Non-circulating share capital
19,224,451.00 10,150,000.00 29,374,451.00
with restricted trade conditions
1. State-owned shares
2. Shares held by domestic legal
persons
3. Other domestic shares 19,213,921.00 19,213,921.00
Including: Shares held by
10,530.00 10,150,000.00 10,160,530.00
domestic natural person
II. Circulating share capital 330,790,524.00 330,790,524.00
1. Domestically listed ordinary
215,790,524.00 215,790,524.00
shares (A-share)
2. Domestically listed ordinary
115,000,000.00 115,000,000.00
shares (B-share)
III. Total 350,014,975.00 10,150,000.00 360,164,975.00
The non-circulating share capital of Dalian Bingshan Group Co., Ltd. circulated on 21st January,
2011, but Dalian Bingshan Group Co., Ltd. declared that these shares would not be listed to sell in
the Shenzhen Stock Exchange within 60 months after the circulating date. Base on the promise, the
Company will apply to unlock these shares until the Company practices management equity
incentive.
According to the report on granting the restricted stock to the incentive object deliberated by the
15th Meeting of 6th Session of the Board of Directors of the Company, and the restricted stock plan
draft of the Company, the Board has implemented and completed granting the restricted stock with
total 41 person and 10,150,000 shares.
29 Capital surplus
Increased during current Decreased during current
Items 31-12-2014 31-12-2015
year year
Capital premium 515,188,976.98 35,784,208.92 550,973,185.90
Other capital
67,099,029.31 12,192,776.74 79,291,806.05
surplus
Total 582,288,006.29 47,976,985.66 630,264,991.95
The reason of the ending balance of capital premium increased was capital premium from granting
the restricted stock to the incentive object and acquiring minority shareholders’ equity of Dalian
88
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Bingshan Metal Processing Co., Ltd., Wuhan New World Refrigeration Industrial Co., Ltd. and
Dalian Bingshan Group Sales Co., Ltd.
Other capital surplus was cost of equity incentive plan and capital surplus changes of the invested
entities.
30 Treasury share
Increased during current Decreased during current
Items 31-12-2014 31-12-2015
year year
Equity incentive
39,503,800.00 39,503,800.00
buy-back
Total 39,503,800.00 39,503,800.00
The treasury share arises from the execution of equity incentive plan.
31 Other comprehensive income
2015
Less：
Previously After-tax
recognize
After-tax attribute
Items 31-12-2014 Amount for the d in profit 31-12-2015
Less：income attribute to the to
period before or loss in
tax parent minority
income tax other company sharehold
comprehe
er
nsive
income
I.Later can’t
reclassified into
profit and loss of
other
comprehensive
income
II. Later
reclassified into
profit and loss of
other
comprehensive
income
1、Later reclassified
into profit and loss
of other
comprehensive 2,768,286.72 2,768,286.72
income of long term
investments
accounting by
equity method
2、Changes in fair
value recognized in
gains and losses of 690,846,860.39 103,627,029.06 587,219,831.33 587,219,831.33
the
available-for-sale
financial assets
3、Foreign currency
translation
differences of
financial statements
Total 2,768,286.72 690,846,860.39 103,627,029.06 587,219,831.33 589,988,118.05
The reason of the ending balance increased 21,212.39% compared with the beginning balance was
Guotai Junan Securities Co., Ltd. listed by Shanghai Security Exchange and measured by fair value
at the end of current year.
89
Dalian Refrigeration Co., Ltd. 2015 Annual Report
32 Special reserves
Increased Decreased
Items 31-12-2014 during current during current 31-12-2015
year year
Safety production expenses 1,982,950.50 1,982,950.50
Total 1,982,950.50 1,982,950.50
33 Surplus reserves
Increased during Decreased during
Items 31-12-2014 31-12-2015
current year current year
Statutory surplus reserves 272,675,444.95 12,602,496.26 285,277,941.21
Discretionary surplus reserve 273,112,803.04 22,378,995.91 295,491,798.95
Total 545,788,247.99 34,981,492.17 580,769,740.16
The increase of the surplus reserves were because the statutory reserved capital RMB12,602,496.26
was withdrawn on the basis of 10% of the company’s net profit of year 2015 and the discretionary
surplus reserve RMB22,378,995.91 was withdrawn on the basis of 20% of the company’s net profit
of 2014 according to the resolution of the General Meeting of Shareholders of year 2014.
34 Retained earnings
Items 2015 Extraction or allocation proportion
Retained earnings at the end of prior year 486,167,740.13
Add: Changes in accounting policies
At beginning of the year after retrospective adjustment 486,167,740.13
Add: Net profit of the current period 129,947,307.39
Less: Appropriation of statutory surplus reserves 12,602,496.26 10% of net profit of year 2015
Appropriation of other reserved capital 22,378,995.91 20% of net profit of year 2014
Appropriation of employee’s welfare and bonus fund
in foreign invested company
Employee welfare fund 1,183,742.85
Cash dividends 54,024,746.25 RMB 0.15 per share of year 2014
Dividends transferred to share capital
Retained earnings at the end of the current year 525,925,066.25
35 Total operating income and operating cost
2015 2014
Items
Income Cost Income Cost
Key business 1,590,994,011.67 1,299,526,134.12 1,405,820,529.51 1,065,329,668.79
Other business 16,524,427.94 10,317,677.51 19,895,067.45 21,220,983.94
Total 1,607,518,439.61 1,309,843,811.63 1,425,715,596.96 1,086,550,652.73
36 Taxes and surcharges
Items 2015 2014
Business tax 2,923,558.17 2,311,815.61
City maintenance and construction tax 5,537,296.43 5,367,351.03
Education surtax 2,376,842.04 2,300,699.68
Local education surtax 1,584,380.79 1,536,768.24
Dike maintenance fee 75,670.03 192,113.07
Others 90,505.35 810.40
Total 12,588,252.81 11,709,558.03
90
Dalian Refrigeration Co., Ltd. 2015 Annual Report
37 Selling and distribution expenses
Items 2015 2014
Handle official business expenses 11,068,186.75 10,742,606.13
Salaries and subsidies 35,936,748.51 53,725,627.39
Depreciation expenses 464,268.28 503,348.47
Transportations expenses 8,803,297.34 15,263,039.31
Entertainment expenses 7,139,713.17 12,113,438.28
Traveling expenses 10,734,718.12 19,162,210.69
Maintenance and repair expenses 3,731,758.17 9,767,507.33
Advertisement and bids expenses 470,935.68 914,413.58
Others 1,750,129.96 1,078,638.43
Total 80,099,755.98 123,270,829.61
The reason of the amount of 2015 decreased 35.02% compared with that of 2014 was the Company
entrust the after-sales service and repair to Subsidiary of Company.
38 Administrative expenses
Items 2015 2014
Handle official business expenses 15,237,435.94 16,976,681.67
Salaries and subsidies 113,018,720.80 106,154,455.88
Depreciation expenses 7,578,564.10 7,379,598.57
Transportations expenses 5,006.00 353,692.74
Entertainment expenses 3,089,233.55 3,703,698.39
Traveling expenses 3,777,397.06 2,982,426.76
Maintenance and repair expenses 4,705,156.18 5,936,182.46
Advertisement expenses 425,141.71 786,515.44
Other taxes and fees 9,424,970.21 8,667,319.24
Insurance expenses 1,068,219.27 2,905,336.91
Research and development expenses 17,126,086.75 16,744,651.31
Amortization of long term assets 4,640,649.75 4,454,384.51
Design consultant and test service expenses 1,755,118.29 4,514,765.97
Safety production expenses 2,382,233.92
Others 2,812,661.96 4,141,351.60
Total 187,046,595.49 185,701,061.45
39 Financial expenses
Items 2015 2014
Interest expenses 5,362,949.64 4,063,705.65
Less:Interest income -6,592,204.15 11,410,822.81
Losses on exchange(Less: Gain on exchange) 186,879.42 688,169.98
Other expenses 1,172,689.75 544,748.14
Total 130,314.66 -6,114,199.04
The reason of the amount of 2015 increased 102.13% compared with that of 2014 was interest
expenses of loan increased and fixed term deposit decreased.
91
Dalian Refrigeration Co., Ltd. 2015 Annual Report
40 Impairment losses
Items 2015 2014
Provision for bad debts 16,646,342.24 18,965,623.56
Provision for obsolete inventories 477,284.08 189,751.97
Provision for the impairment of available-for-sale financial
assets
Provision for the impairment of held to maturity investments
Provision for the impairment of long-term equity investments
Provision for the impairment of investing property
Provision for the impairment of fixed assets
Provision for the impairment of construction materials
Provision for the impairment of construction in progress
Provision for the impairment of bearer biological assets
Provision for the impairment of oil assets
Provision for the impairment of intangible assets
Provision for the impairment of goodwill
Provision for the impairment of other assets
Total 17,123,626.32 19,155,375.53
41 Gain/ (loss) from investment
(1) Details
Items 2015 2014
Calculated by equity method 125,543,630.87 101,428,429.25
Calculated by cost method
Gain from disposal associated company 681,816.41
Gain from holding of financial assets available for sale 3,364,489.50 1,793,969.75
Gain from disposal financial assets available for sale 36,617.40
Total 128,908,120.37 103,940,832.81
(2) There was no severe constrict on the collection of the investment earnings.
42 Non-business incomes
(1)Details
The amount recorded in
Items 2015 2014 non-recurring gains and losses of
current period
Gain on the disposal of non-current
167,463.99 390,490.35 167,463.99
assets
Penalty and fine income 294,915.22 1,138,950.84 294,915.22
Subsidy fund from government 709,526.19 7,457,380.75 709,526.19
Deferred income 3,395,588.19 5,132,556.41 1,696,490.19
Debts need not paid 2,630,968.84 563,891.43 2,630,968.84
Others 260,901.11 483,180.61 260,901.11
Total 7,459,363.54 15,166,450.39 5,760,265.54
(2) Subsidy fund from government
Items 2015 2014 Explanations
Subsidy for information construction from Dalian
42,000.00 Related to gain
Municipal Bureau of Finance
Aid for patent from Dalian Intellectual Property
5,000.00 1,500.00 Related to gain
Service Centre
Subsidy of economic support policy 76,300.00 Related to gain
92
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Items 2015 2014 Explanations
Subsidy for social security 11,165.00 Related to gain
Subsidy for circular economy project Related to gain
Award for QC team Related to gain
Aid for patent from Wuhan Intellectual Property
Bureau Related to gain
Subsidy and award for patent Related to gain
Mayor’s Quality Award Related to gain
Financial incentive award for increasing production
and sales Related to gain
Subsidy for science and technology development Related to gain
Subsidy for small and medium-sized enterprises
exploiting international market 60,000.00 Related to gain
Financial award for export 27,318.37 Related to gain
Taxes given back 499,945.82 726,080.75 Related to gain
Subsidy from Disabled Person Federation and Disabled
20,697.00 Related to gain
Person Service Center
Economic supportive policy 43,400.00 Related to gain
International market developing fund for small and
20,000.00 Related to gain
mid size enterprises
Subsidy for the first set of important technology
5,600,000.00 Related to gain
equipment
Reward for promoting increase of industry of year
1,025,000.00 Related to gain
2015
Subsidy for patent from Wuhan Interllectual Property
1,500.00 Related to gain
Bureau
Subsidy for disposal of useless vehicals 7,000.00 Related to gain
Total 709,526.19 7,457,380.75
The reason of current period amount decreased 50.82% compared with last period was subsidy from
government decreased.
43 Non-business expenses
The amount recorded in
Items 2015 2014 non-recurring gains and losses of
current period
Loss on the disposal of non-current assets 229,182.73 412,897.02 229,182.73
Fines and penalties 8,316.69 29,513.98 8,316.69
Loss on debt restructuring 586,377.00
Others 282,035.87 119,121.64 868,412.87
Total 1,105,912.29 561,532.64 1,105,912.29
The reason of current period amount increased 96.95% compared with last period was strengthened
accounts recieveable collection and debt restructuring.
44 Income tax expenses
(1) Details:
Items 2015 2014
Current income tax expense 8,782,088.36 6,786,355.61
Deferred income tax expense -4,049,456.17 2,682,431.87
Total 4,732,632.19 9,468,787.48
93
Dalian Refrigeration Co., Ltd. 2015 Annual Report
(2) Adjustment process of accounting profit and income tax expense
Items 2015
Total profits 135,947,654.34
Current income tax expense accounted by tax and relevant
20,392,148.15
regulations
Influence of different tax rate suitable to subsidiary 3,651,553.71
Influence of income tax before adjustment -332,570.54
Influence of non taxable income -19,741,494.75
Influence of not deductable costs, expenses and losses -754,795.63
Influence of deductable losses of deferred income tax assets
1,374,188.25
derecognized used in previous period
Influence of deductible temporary difference or deductible losses
143,603.00
of deferred income tax assets derecognized in reporting period.
Income tax expenses 4,732,632.19
(3) Other explaination
The reason of current period amount of income tax expense decreased 50.02% compared with last
period was deferred income tax decreased.
45 Relevant information about cash flow statement
(1) Other cash received relating to operating activities
Items 2015 2014
Government grants 989,230.70 6,722,800.00
Received travel expense receivable 3,352,659.29 1,516,117.27
Deposit received 25,139,681.07 13,940,611.00
Received amount paid on behalf of related companies 705,562.72
interest income 11,419,665.11 9,972,394.64
Others 2,358,819.33 4,492,792.37
Total 43,260,055.50 37,350,278.00
(2) Other cash paid relating to operating activities
Items 2015 2014
Borrowing of travel expense 3,325,287.08 3,579,202.08
Deposit paid 26,407,383.40 26,539,861.00
Expenditure 79,560,411.38 99,074,957.27
Payment to related companies 519,142.61
Bank handling charges 1,123,590.67 501,204.64
Others 1,311,099.46 2,712,084.92
Total 112,246,914.60 132,407,309.91
(3) Cash receipts related to other financing activities
Items 2015 2014
Guarantee money took back 32,953,876.63 10,844,272.75
Total 32,953,876.63 10,844,272.75
(4) Other cash paid relating to financing activities
94
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Items 2015 2014
Interests on discount of bill acceptance 45,446.93 83,527.50
Guarantee money paid 20,665,689.93
32,953,876.63
Total 20,711,136.86 33,037,404.13
46 Complementary information for consolidated cash flow statement
(1) The relationship between the net profit and the net cash flows from operating activities
Items 2015 2014
1. Reconciliation from the net profit to the cash flows from operating
activities
Net profit 131,215,022.15 114,519,281.73
Add: Provisions for assets impairment 17,123,626.32 19,155,375.53
Depreciation of fixed assets 38,335,936.87 36,829,801.68
Amortization of intangible assets 4,507,956.43 4,328,566.19
Amortization of long-term deferred expenses 1,591,669.04 797,209.95
Losses on disposal of fixed assets, intangible assets and other long-term
11,212.67 -551,138.66
assets
Losses on scrapping of fixed assets 50,506.07 -144,888.48
Losses on variation of fair value
Finance expenses 5,560,290.68 4,273,314.16
Investment losses -128,908,120.37 -103,222,399.00
Decrease in deferred tax assets -4,049,456.17 2,682,431.87
Increase in deferred tax liabilities
Decrease in inventory 71,261,447.45 14,354,478.23
Decrease in operating receivables -114,889,219.96 -61,319,139.33
Increase in operating payables -84,569,865.56 -3,207,121.40
Others 12,190,520.00
Net cash flows from operating activities -50,568,474.38 28,495,772.47
2. Investing and financing activities that do not involve cash receipts and
payments
Conversion of debt into capital
Convertible bonds to be expired within one year
Fixed assets under finance lease
3. Net increase in cash and cash equivalents
Cash at the end of the period 221,724,134.60 475,557,589.39
Less: Cash at the beginning of the period 475,557,589.39 502,339,160.35
Plus: Cash equivalents at the end of the period
Less: Cash equivalents at the beginning of the period
Net increase in cash and cash equivalents -253,833,454.79 -26,781,570.96
(2) Net cash paid for acquiring subsidiaries and other business units
Items 2015
Cash and cash equivalents paid for acquiring subsidiaries 26,993,388.94
Including: Dalian Sanyo High-efficient Refrigeration System Co., Ltd. 26,993,388.94
Less: Cash and cash equivalents from acquired subsidiaries 6,528,961.79
Including: Dalian Sanyo High-efficient Refrigeration System Co., Ltd. 6,528,961.79
95
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Items 2015
Net cash paid for acquiring subsidiaries and other business units 20,464,427.15
(3)Cash and cash equivalents
Items 2015 2014
1.Cash 221,724,134.60 475,557,589.39
Including: cash on hand 57,023.71 67,783.07
Bank deposits that can be used for payment whenever necessary 221,667,110.89 457,395,413.41
Other monetary capital that can be used for payment whenever
18,094,392.91
necessary
2.Cash equivalents
Including: Bonds mature within 3 months
3.Balance of cash and cash equivalents at the end of the year 221,724,134.60 475,557,589.39
Including: Cash or cash equivalents which was restricted in use of the
Company and subsidiaries in the group
47 The assets with the ownership or use right restricted
Items 31-12-2015 Reasons
Monetary fund 23,065,689.93 Guarantee money
Available for sale
719,363,590.50 During restricted sale periods
financial assets
Fixed assets 98,504,280.42 Subsidiaries’ assets mortgaged for loans
Intangible assets 53,848,990.00 Subsidiaries’ assets mortgaged for loans
Total 894,782,550.85
48 Foreign currency monetary items
Ending balance of Original Ending balance of RMB
Items Exchange rate
currency equivalent
Monetary fund
Included: USD 1,962.92 6.4936 12,746.41
EUR 5.60 7.0952 39.73
JPY 229,261.00 0.053875 12,351.43
GBP
Accounts receivable
Included: GBP 123,632.40 9.6159 1,188,836.80
Accounts payable
Included: GBP 36,399.28 9.6159 350,011.84
Included: USD 6,726.55 6.4936 43,679.53
Ⅶ. Changes of consolidation scope
1. Enterprise combined not under the same control in reporting period
96
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Income of Net Profit
Determination Acquire of Acquire
Time-poi Ratio of Method
Obtained Basis on the from the from the
Name of nt of Obtained of Purchasing
Cost of Purchasing Purchasing Purchasing
acquiree Obtained Equity Obtained Date
Equity Date Date to the Date to the
Equity (100%) Equity
End of the End of the
Period Period
Daliian
Sanyo
High-Effici Cash paid and
ent 2015.7.31 26,993,388.94 30 cash 2015.7.31 related procedure 58,355,875.55 1,201,817.66
Refrigerati finished
on System
Co., Ltd.
2. Combined cost and goodwill
Daliian Sanyo High-Efficient Refrigeration System
Combined cost
Co., Ltd
Cash 26,993,388.94
Purchasing date fair value of shares held befor
21,294,200.84
purchasing date
Total combined cost 48,287,589.78
Less: the fair value of identifiable net assets 46,847,241.86
Goodwill 1,440,347.92
The Company acquired 30% shares of Daliian Sanyo High-Efficient Refrigeration System Co., Ltd.
on 31 July,2015 with consideration of RMB26,993,388.94. On the date of acquisition, the difference
with the fair value of identifiable net assets of Daliian Sanyo High-Efficient Refrigeration System
Co., Ltd. was RMB1,440,347.92, and treated as goodwill in the consolidated financial statements.
At the end of 2015, it carried out the impairment test for the goodwill .
3.The identifiable assets and liabilities of acquiree at purchase date
Daliian Sanyo High-Efficient Refrigeration System Co., Ltd
Items
Purchasing date fair value Purchasing date book value
Monetary fund 6,528,961.79 6,528,961.79
Receivable 48,374,356.95 48,374,356.95
Inventories 13,486,838.02 13,486,838.02
Other current assets 394,944.65 394,944.65
Fixed asset-original cost 35,490,428.03 35,490,428.03
Intangible assets 6,065,499.21 6,065,499.21
Long-term deferred expenses 512,875.00 512,875.00
Deferred income tax assets 364,893.23 364,893.23
Less: Payable 24,818,542.60 24,818,542.60
Payroll payable 1,126,096.85 1,126,096.85
Taxes payable 97,354.05 97,354.05
Total owner's equity 85,176,803.38 85,176,803.38
Net assets calculated according to the
46,847,241.86 46,847,241.86
shareholding proportions
The fair value determination method of the identifiable assets and liabilities:
Daliian Sanyo High-Efficient Refrigeration System Co., Ltd. used net book value as fair value of
the identifiable assets and liabilities.
97
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Ⅷ. Equity in other entities
1. Equity in subsidiary
A. The structure of the group
Shareholding
Main
Registered (%) Obtaining
Name of subsidiaries business Business nature
address Dire Indire method
address
ct ct
Dalian Bingshan Group Refrigeration
Installation Co., Ltd. (“Installation Dalian Dalian Installation 100 Establish
Company”)
Dalian Bingshan Group Sales Co.,
Dalian Dalian Trading 70 30 Establish
Ltd. (“Sales Company”)
Dalian Bingshan Air-Conditioning
Equipment Co., Ltd. (“Bingshan Dalian Dalian Manufacturing 70 Establish
Air-Conditioning”)
Dalian Bingshan Metal Processing
Dalian Dalian Manufacturing 100 Establish
Co., Ltd. (“Metal Processing”)
Dalian Bingshan Guardian
Dalian Dalian Manufacturing 60 Establish
Automation Co., Ltd.
Dalian Bingshan Ryosetsu Quick
Dalian Dalian Manufacturing 70 Establish
Freezing Equipment Co., Ltd.
Wuhan New World Refrigeration
Wuhan Wuhan Manufacturing 100 Purchase
Industrial Co., Ltd. (“WNWRI”)
Bingshan technical service (dalian)
Dalian Dalian Services 100 Establish
Co., Ltd.
Wuhan New World Refrigeration Air Installation
Wuhan Wuhan 5 95 Establish
Conditioner Engineering Co., Ltd.
Ningbo Bingshan Refrigeration Air
Ningbo Ningbo Installation 51 Establish
Conditioner Engineering Co., Ltd.
Daliian Sanyo High-Efficient
Dalian Dalian Manufacturing 55 Combine
Refrigeration System Co., Ltd
①All the holding proportion in subsidiaries were the same with voting proportion；
②The company held over 50% voting proportion in subsidiaries；
③ The company could control these subsidiaries；
④The change of the holding proportion in subsidiaries, please refer to the Note II. The scope of
consolidation.
B. Significant not wholly owned subsidiary
No.
2. The transaction of the company with its owner’s equity share changed but still controlling
the subsidiary
A.Expaination to the changes of the subsidiaries’ owner’s equity share held by the company
(1) According to the 18th meeting of the 6th session of the Company’s Board of Directors, the
Company was transferred 49% shareholdings of Wuhan New World Refrigeration Industrial Co.,
Ltd. (“WNWRI”),and Wuhan New World Refrigeration Industrial Co., Ltd. became wholly owned
subsidiary.
(2)According to the 11th meeting of the 6th session of the Company’s Board of Directors, the
Company was transferred 10% shareholdings of Daliian Bingshan Group Sales Co., Ltd., and
transferred 30% shareholdings of Daliian Bingshan Group Sales Co., Ltd. to WNWRI. At the end of
the current year the company and WNWRI held 100% shareholdings of Daliian Bingshan Group
Sales Co., Ltd.
(3)According to the 12th meeting of the 6th session of the Company’s Board of Directors, the
Company was transferred 35.75% shareholdings of Daliian Bingshan Metal Processing Co., Ltd.
and it became wholly owned subsidiary.
98
Dalian Refrigeration Co., Ltd. 2015 Annual Report
(4) According to the 12th meeting of the 6th session of the Company’s Board of Directors,the
company decided to establish the join-venture Bingshan Technical Service（Dalian）Co.,Ltd. with
Daliian Bingshan International Trade Co., Ltd. The company held 60% equity. According to the
20th meeting of the 6th session of the Company’s Board of Directors, the company was transferred
40% shareholdings of Bingshan Technical Service（Dalian）Co.,Ltd., and it became wholly owned
subsidiary.
B.Affection of the trasactions to minority interests and equity attributable to parent
company
Dalian Bingshan Wuhan New World Dalian Bingshan Bingshan technical
Item Group Sales Co., Refrigeration Metal Processing service (dalian)
Ltd. Industrial Co., Ltd. Co., Ltd. Co., Ltd.
Cash 6,843,000.00 66,694,510.81 9,249,900.00 6,024,000.00
Total purchase cost 6,843,000.00 66,694,510.81 9,249,900.00 6,024,000.00
Less：Net assets calculated
according to the 6,806,378.07 55,815,058.96 9,330,010.7 6,360,172.00
shareholding proportions
Differences 36,621.93 10,879,451.85 -80,110.70 -336,172.00
Included: Adjusted capital
36,621.93 10,879,451.85 -80,110.70 -336,172.00
surplus
3. Equity in joint venture arrangement or associated enterprise
A.The important associated enterprise or joint ventures
Shareholding
Main (%)
Name of joint ventures or affiliated Registered Accounting
business Business nature Dire
companies address Indirect methods
address ct
Associated enterprise:
Dalian Bingshan – P&A Recreation Equity
Dalian Dalian Installation 50%
Development Engineering Co., Ltd. method
Joint ventures:
Keinin-Grand Ocean Thermal Technology Equity
Dalian Dalian Manufacturing 20%
(Dalian) Co., Ltd method
Equity
Panasonic Compressor (Dalian) Co., Ltd Dalian Dalian Manufacturing 40%
method
Dalian Fuji Bingshan Vending Machine Co., Equity
Dalian Dalian Manufacturing 49%
Ltd. method
The company determined important joint venture by its gain from investment to the company over
10% of the company’s net profit or the company’s proportion of its net assets over 10% of the
company’s net assets.
①All the holding proportion in subsidiaries were the same with voting proportion；
②The company had no important influence to joint venture or affiliated company with voting
proportion held by the company under 20%；
③ There was no associated enterprise or joint venture with voting proportion held by the company
over 20%, but the company had no important influence.
B.The main financial information of important associated enterprise
Dalian Bingshan – P&A Recreation Development Engineering Co., Ltd.
Items 31-12-2015/2015 31-12-2014/2014
Current assets 9,006,060.68 11,558,920.00
Including:Cash and cash equivalents 1,132,033.68 2,892,025.92
Non-current assets 471,614.42 213,621.85
Assets total 9,477,675.10 11,772,541.85
99
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Items 31-12-2015/2015 31-12-2014/2014
Current liabilities 3,803,479.48 4,616,122.53
Non-current liabilities
Total liabilities 3,803,479.48 4,616,122.53
Minority interests
Equity to the parent company 5,674,195.62 7,156,419.32
Net assets calculated according to the
2,837,097.81 3,578,209.66
shareholding proportions
Adjusting events
—Goodwill
—Unrealized profits of insider tradings
—Employee’s welfare and bonus fund in foreign
-24,289.69
invested company
Book value of equity investment of associated
2,837,097.81 3,553,919.97
enterprise
Fair value of equity investment with public offer
Operating income 1,967,955.20 17,925,040.13
Finance expenses -2,128.17 -4,324.02
Income tax -561.52 309,263.49
Net profit -1,482,223.70 971,587.74
Other comprehensive income
Total comprehensive income -1,482,223.70 971,587.74
The dividends received from associated enterprise
500,000.00
during current year
C. The main financial information of important joint ventures
31-12-2015/2015
Items Keinin-Grand Ocean Dalian Fuji Bingshan
Panasonic Compressor
Thermal Technology Vending Machine Co.,
(Dalian) Co., Ltd
(Dalian) Co., Ltd Ltd.
Current assets 288,372,485.62 1,394,237,128.94 361,305,733.51
Non-current assets 96,260,501.77 350,839,627.19 61,629,639.07
Total assets 384,632,987.39 1,745,076,756.13 422,935,372.58
Current liabilities 141,597,811.02 587,437,711.53 188,191,481.16
Non-current liabilities 3,583,780.65
Total liabilities 141,597,811.02 587,437,711.53 191,775,261.81
Minority interests
Equity to the parent company 243,035,176.37 1,157,639,044.60 231,160,110.77
Net assets calculated according to the
48,607,035.27 463,055,617.84 113,268,454.28
shareholding proportions
Adjusting events
—Goodwill
—Unrealized profits of insider
tradings
—Employee’s welfare and bonus fund
-5,163,248.92
in foreign invested company
100
Dalian Refrigeration Co., Ltd. 2015 Annual Report
31-12-2015/2015
Items Keinin-Grand Ocean Dalian Fuji Bingshan
Panasonic Compressor
Thermal Technology Vending Machine Co.,
(Dalian) Co., Ltd
(Dalian) Co., Ltd Ltd.
Book value of equity investment of
48,607,035.27 457,892,368.92 113,268,454.28
affiliated companies
Fair value of equity investment with
public offer
Operating income 680,314,218.23 1,894,363,146.75 463,077,411.32
Net profit 79,365,464.49 161,351,528.59 58,543,688.14
Net profit of discontinuing operation
Other comprehensive income
Total comprehensive income 79,365,464.49 161,351,528.59 58,543,688.14
The current dividends received from
9,600,000.00 34,000,000.00 5,314,796.52
joint ventures
Continued：
31-12-2014/2014
Items Panasonic Dalian Fuji Bingshan
Panasonic Compressor
Cold-chain (Dalian) Vending Machine Co.,
(Dalian) Co., Ltd
Co., Ltd Ltd.
Current assets 924,187,273.25 1,533,547,513.54 201,931,675.02
Non-current assets 322,882,931.13 358,157,107.39 62,589,896.32
Total assets 1,247,070,204.38 1,891,704,620.93 264,521,571.34
Current liabilities 717,528,722.26 796,714,218.88 77,636,760.15
Non-current liabilities 3,421,865.04
Total liabilities 717,528,722.26 796,714,218.88 81,058,625.19
Minority interests
Equity to the parent company 529,541,482.12 1,094,990,402.05 183,462,946.15
Net assets calculated according to the
211,816,592.84 437,996,160.82 89,896,843.61
shareholding proportions
Adjusting events
—Goodwill 4,440,630.90
—Unrealized profits of insider
tradings
—Employee’s welfare and bonus fund
-683,617.26 -5,481,154.41
in foreign invested company
Book value of equity investment of
215,573,606.48 432,515,006.40 89,896,843.61
affiliated companies
Fair value of equity investment with
public offer
Operating income 1,689,304,466.33 2,433,075,590.63 375,618,136.05
Net profit 21,363,039.25 171,286,075.45 30,204,438.98
Net profit of discontinuing operation
Other comprehensive income
Total comprehensive income 21,363,039.25 171,286,075.45 30,204,438.98
The current dividends received from
8,000,000.00 16,000,000.00 2,161,995.35
joint ventures
101
Dalian Refrigeration Co., Ltd. 2015 Annual Report
D.Summary financial information of insignificant joint ventures
Items 31-12-2015/2015 31-12-2014/2014
Total book value of investment of
597,762,811.43 297,690,362.39
affiliated companies
The total of following items according to
— —
the shareholding proportions
Net profit 19,827,582.11 16,869,672.64
Other comprehensive income
Total comprehensive income 19,827,582.11 16,869,672.64
E. No significant restrictions of the ability of joint venture or associated enterprise transfer
funds to the company.
F.No excess loss of joint venture or associated enterprise.
G.No commitment related to joint venture or associated enterprise needed disclose.
H.No contingent liabilities related to joint venture or associated enterprise needed disclose.
Ⅸ. The risk related financial instruments
The Company faces a variety of financial risks in the course of operation: credit risk, liquidity risk
and market risk(mainly exchange risk and interest rate risk). The objective of the company‘s risk
management is to obtain a proper balance between the risks and benefits, reduce the risks‘ negative
impact on the company's operating performance.
1.Credit risk
The credit risk of the company included monetary fund, accounts receivable, notes receivable and
other accounts receivable etc.The management made credit policies and supervised changes of these
credit explosure.
The company's working capital was in bank with higher credit rating, so there was no significant
credit risk, nor significant losses due to the default of other entity.
Company mainly faces customer credit risk caused by the credit sale. The Company would make an
evaluation on new customers‘ credit risk before signing new contracts, which includes external
credit rating and bank reference letter (when available) under certain circumstances. The Company
sets quota on credit sale for each customer and such quota is the maximum amount without
additional approvals.As at 31st December 2015,the big five customers of accounts receiveable was
14.91% of total accounts receiveable, and as at 31st December 2014 that was 8.10%.
Except guarantee events disclosed in the notes, there was no other credit risk of guarantee of the
company.
2. Liquidity risk
Liquidity risk was referred to the risk of shortage of funds incurred when the enterprise perform the
obligation of settlement by cash or other financial assets.
The financial department of the company continued to monitors the short term or long term capital
needs to ensure maintain plenty of cash flow.And the same time they also monitor the condition of
bank loan agreements and obtain commitments from banks to provide plenty of fund.
As at 31st December 2015, the company’s financial assets and financial liabilities in line with non
discount cash flow of the contracts as following：
31-12-2015
Items Original value 1-2 2-5
Book value Within 1 year Over 5 years
of the book years years
Monetary fund 244,789,824.53 244,789,824.53 244,789,824.53
Notes receivable 71,699,517.68 71,699,517.68 71,699,517.68
102
Dalian Refrigeration Co., Ltd. 2015 Annual Report
31-12-2015
Items Original value 1-2 2-5
Book value Within 1 year Over 5 years
of the book years years
Accounts
671,423,836.87 801,499,499.03 671,423,836.87
receivable
Interest
receivable
Other
22,755,328.21 28,070,768.44 22,755,328.21
receivables
Available for
sale financial 733,275,249.09 738,500,019.89 733,275,249.09
assets
Subtotal 1,743,943,756.38 1,884,559,629.57 1,010,668,507.29 733,275,249.09
Short-term
82,600,000.00 82,600,000.00 82,600,000.00
borrowings
Notes payable 234,189,011.72 234,189,011.72 234,189,011.72
Accounts
660,398,503.26 660,398,503.26 660,398,503.26
payable
Employees’
compensation 51,857,345.29 51,857,345.29 51,857,345.29
payable
Taxes payable 15,701,578.36 15,701,578.36 15,701,578.36
Dividend
533,156.00 533,156.00 533,156.00
payable
Other payables 99,890,290.15 99,890,290.15 99,890,290.15
Subtotal 1,145,169,884.78 1,145,169,884.78 1,145,169,884.78
Continued:
31-12-2014
Items Original value
Book value Within 1 year 1-2 years 2-5 years Over 5 years
of the book
Monetary fund 508,511,466.02 508,511,466.02 508,511,466.02
Notes receivable 14,855,957.70 14,855,957.70 14,855,957.70
Accounts
438,880,830.12 555,119,550.49 438,880,830.12
receivable
Interest
4,998,982.40 4,998,982.40 4,998,982.40
receivable
Other
34,266,444.02 39,244,121.02 34,266,444.02
receivables
Available for
sale financial 42,428,388.70 47,653,159.50 42,428,388.70
assets
Subtotal 1,043,942,068.96 1,170,383,237.13 1,001,513,680.26 42,428,388.70
Short-term
60,000,000.00 60,000,000.00 60,000,000.00
borrowings
Notes payable 109,546,502.61 109,546,502.61 109,546,502.61
Accounts
511,076,537.82 511,076,537.82 511,076,537.82
payable
Employees’
compensation 55,993,637.27 55,993,637.27 55,993,637.27
payable
Taxes payable 2,642,729.69 2,642,729.69 2,642,729.69
Dividend
533,156.00 533,156.00 533,156.00
payable
Other payables 60,075,814.04 60,075,814.04 60,075,814.04
Subtotal 799,868,377.43 799,868,377.43 799,868,377.43
103
Dalian Refrigeration Co., Ltd. 2015 Annual Report
3. Market risk
A. Exchange rate risk
Most of the company’s business located in China, and settled with RMB.But the company defined
exchange rate risk of foreign currency assets and future foreign currency transaction (mainly
including USD,JPY,HKD and GBP). The financial department of the company monitors the
company’s foreign currency transaction and the scale of foreign assets and liabilities, and
decreases exchange rate risk.
①During the current year the company didn’t buy any forward foreign exchange contract or swap
contract.
② As at 31st December 2015, the company’s foreign currency assets and foreign currency liabilities
listed in RMB as following：
31-12-2015
Items
USD JPY GBP EUR Total
Foreign currency
financial assets,
Monetary fund 12,746.41 12,351.43 39.73 25,137.57
Notes receivable 1,188,836.80 1,188,836.80
Subtotal 12,746.41 12,351.43 1,188,836.80 39.73 1,213,974.37
Foreign currency
financial liability
Accounts payable 43,679.53 350,011.84 393,691.37
Subtotal 43,679.53 350,011.84 393,691.37
Continued:
31-12-2014
Items
USD JPY GBP EUR Total
Foreign currency
financial assets,
Monetary fund 91,285.75 8,353.65 2,283,436.54 41.75 2,383,117.69
Notes receivable 2,578,861.20 2,578,861.20
Subtotal 91,285.75 8,353.65 4,862,297.74 41.75 4,961,978.89
Foreign currency
financial liability
Accounts payable 347,383.81 347,383.81
Subtotal 347,383.81 347,383.81
The sensitive analysis：
As at 31st December 2015 , because the company’s foreign currency assets or liabilities were small,
the change of foreign exchange rate had little impact to the company’s net profit or shareholders'
equity.
B. Interest rate risk
The interest risk of the Group incurred from bank loan, interest rate risk of a floating interest rate of
financial liabilities that lead to the company facing cash flow interest rate risk, financial liabilities
with a fixed interest rate lead to the company facing cash flow interest rate risk. The company
determined the proportion of fixed interest rate and floating interest rate according the current
market circumstance. As at 31st December 2015 , the subsidiary of the company Wuhan New
World Refrigeration Industrial Co., Ltd. borrowed short term loan RMB 82,600,000.00 with fixed
interest rate.
The financial department of the company continuously monitors the interest rates level, and the
management would make some adjustment to face interest rate increasing.
104
Dalian Refrigeration Co., Ltd. 2015 Annual Report
The sensitive analysis：
Base on the assumption of interest rate change of 50 BP, the company’s net profit of year 2015 will
increase or decrease RMB413,000.00
Ⅹ.Fair value
1.Items measured at fair value
As at 31 December,2015,some equity investments of available-for-sale financial assets were
measured at the fair value.
Fair value level can be classified according to the input value of the lowest level that is significant
to whole measurement of fair value:
First level: quote of same assets or liabilities in an active market (unadjusted).
Second level: directly (price) or indirectly (derive from price) use observable input value other than
market quote of assets or liabilities in the first level.
Third level: use any input value not based on observable market data in assets or liabilities
(unobservable input value).
2.Item measured at fair value at the end of current year
Fair value at the end of current year
Items
First level Second level Third level Total
Sub-total of available for sale
719,363,590.50 719,363,590.50
financial assets
Debt instrument investment
Equity instrument investment 719,363,590.50 719,363,590.50
Other investment
Total assets 719,363,590.50 719,363,590.50
3.Determined on the basis of continuous first level for fair value measurement according to the
closed price of stock market as at the end of year 2015.
4.The above fair value of the company did not changed in different levels.
5.Financial assets and financial liabilities not measured at fair value mainly include: Cash and
bank balances, notes receivable,accounts receivable, other receivables, short-term loans, notes
payable, accounts payable, other payables, long-term payables, etc.The difference between the book
value of financial assets and financial liabilities that are not measured at fair value and fair value is
small.
Ⅺ. Related Parties Relationships and Transactions
1 Information of the company’s parent company
Name of Registered Nature of Registered The parent The parent
company's company's
enterprise address business capital shareholding voting right
Dalian
Bingshan Group Dalian Manufacture 158,580,000.00 21.34% 21.34%
Co., Ltd.
(1) Information of the company’s parent company
Dalian Bingshan Group Co., Ltd. Is a sino –foreign joint venture located No.888 Xinan Road,
Shahekou District, Dalian, China.The legal representive person of Dalian Bingshan Group Co., Ltd.
Is Homma Tetsuro, and the registed capital is RMB158.58 million. The registed business operation
period is from 3rd July 1985 to 2nd July 2035. The business scope include research, development,
manufacture, sales, service and installment of refrigeration product, freezing and cooling product,
different size of air-conditioners, petrochemical equipment, electronic and electronic
controlproduct, home electronic appliance, environment protect equipment and etc. (Business
105
Dalian Refrigeration Co., Ltd. 2015 Annual Report
needed administrative permission must have the administrative license. )
(2) There is no ultimate controller at the end of the current year.
2 The information of the subsidiaries please refers toⅧ.1 of this note.
3 The information of the affiliated company and joint venture please refers toⅧ.3 of this note.
The companies had related party transaction with the company during the current period or had
transaction balance at the end of last period, including:
Names of the joint ventures or affiliated companies Relationships with the Company
Dalian Bingshan – P&A Recreation Development Engineering Co., Ltd Joint venture of the Company
Dalian Bingshan Engineering & Trading Co. , Ltd Associated companie of the Company
Panasonic Refrigeration (Dalian) Co., Ltd Associated companie of the Company
Dalian Honjo Chemical Co., Ltd Associated companie of the Company
Panasonic Cold-chain (Dalian) Co., Ltd Associated companie of the Company
Keinin-Grand Ocean Thermal Technology (Dalian) Co., Ltd Associated companie of the Company
Panasonic compressor (Dalian) Co., Ltd Associated companie of the Company
Dalian Sanyo Meica Electronics Co., Ltd Associated companie of the Company
Beijing Huashang Bingshan Refrigeration and Air-conditioning Machinery Co., Ltd Associated companie of the Company
Dalian Fuji Bingshan Vending Machine Co., Ltd Associated companie of the Company
Daliian Sanyo High-Efficient Refrigeration System Co., Ltd Associated companie of the Company
MHI Bingshan Refrigeration (Dalian) Co.,Ltd Associated companie of the Company
Changzhou Jingxue Freezing Equipment Co., Ltd. Associated companie of the Company
Dalian Fuji Bingshan Vending Machine Co., Ltd. Associated companie of the Company
Wuhan Lanning Energy Science Co., Ltd. Associated companie of subsidiary
Daliian Sanyo High-Efficient Refrigeration System Co., Ltd was a Joint venture of the company
during January to July of 2015, and its financial information of January to July of 2015 included in
the above form.
4 Other type of the related parties
Names of the related parties Relationships with the Company
Dalian Bingshan Group Refrigeration Equipment Co., Ltd Associated company of Dalian Bingshan Group
Dalian Third Refrigeration Equipment Factory Subsidiary of Dalian Bingshan Group
Beijing Bingshan Serial Refrigeration Equipment Co., Ltd Subsidiary of Dalian Bingshan Group
Dalian Spindle Cooling Towers Co., Ltd Associated company of Dalian Bingshan Group
Dalian Bingshan Metal Technology Co., Ltd Associated company of Dalian Bingshan Group
Dalian Mahe Level Control Electrical Appliances Co., Ltd Associated company of Dalian Bingshan Group
Linde Engineering (Dalian) Co., Ltd Associated company of Dalian Bingshan Group
BAC Dalian Co., Ltd Joint venture of Dalian Bingshan Group
Linde Engineering (Hangzhou) Co., Ltd Associated company of Dalian Bingshan Group
5 The transactions between the Company and the related parties
(1) The consolidated financial statements are based on the financial statements of individual
subsidiaries which are included in the consolidation scope and prepared after elimination effect of
intra-group transaction.
106
Dalian Refrigeration Co., Ltd. 2015 Annual Report
(2) Purchases of goods from related parties
Details of
Names of the related parties 2015 2014
transaction
Panasonic Refrigeration (Dalian) Co., Ltd. Purchases of goods 15,802,549.92 4,862,468.53
Panasonic Cold Chain (Dalian) Co., Ltd. Purchases of goods 193,000,774.15 17,727,279.07
Panasonic Refrigeration (Dalian) Co., Ltd. Purchases of goods 1,170,571.97 2,725,666.67
Dalian Sanyo Meica Electronics Co., Ltd Purchases of goods 266,054.52 444,561.67
Dalian Bingshan Group Refrigeration Equipment
Purchases of goods 19,240,996.98 50,692,001.24
Co., Ltd
Dalian Third Refrigeration Equipment Factory Purchases of goods 9,477,468.27 8,322,630.93
Dalian Spindle Cooling Towers Co., Ltd Purchases of goods 1,649,338.45 740,512.80
BAC Dalian Co., Ltd Purchases of goods 39,198,256.38 48,249,141.90
Dalian Bingshan Engineering & Trading Co. , Ltd Purchases of goods 71,456,746.91 33,445,174.50
Dalian Bingshan Group Materials Trading Co. , Ltd Purchases of goods 1,599,625.64
Dalian Bingshan Metal Technology Co., Ltd Purchases of goods 316,910.80 821,259.04
Daliian Sanyo High-Efficient Refrigeration System
Purchases of goods 763,338.56 2,008,804.63
Co., Ltd
Beijing Bingshan Serial Refrigeration Equipment
Purchases of goods 341,880.34 44,169.93
Co., Ltd
Beijing Huashang Bingshan Refrigeration and
Purchases of goods 1,398,717.87
Air-conditioning Machinery Co., Ltd.
Dalian Fuji Bingshan Vending Machine Co., Ltd Purchases of goods 242,187.94
Changzhou Jingxue Freezing Equipment Co., Ltd. Purchases of goods 11,909,299.18
MHI Bingshan Refrigeration (Dalian) Co.,Ltd. Purchases of goods 125,734.92
Total 366,360,827.16 171,683,296.55
(3) Sales of goods to related parties
Details of
Names of the related parties transaction 2015 2014
Panasonic Refrigeration (Dalian) Co., Ltd. Sales of goods 27,493,069.64 7,015,543.66
Panasonic Cold Chain (Dalian) Co., Ltd. Sales of goods 71,856,798.06 23,234,625.97
Panasonic Refrigeration (Dalian) Co., Ltd. Sales of goods 5,196,070.67 7,516,298.00
Dalian Bingshan Group Refrigeration Equipment Co., Ltd Sales of goods 776,009.44 1,166,100.16
Dalian Third Refrigeration Equipment Factory Sales of goods 1,821,581.25 5,296,508.27
BAC Dalian Co., Ltd Sales of goods 96,085.47 1,937,329.05
Dalian Bingshan Engineering & Trading Co. , Ltd Sales of goods 97,111,776.90 90,440,496.58
Dalian Bingshan – P&A Recreation Development Engineering
Sales of goods 6,538.47 512,915.66
Co., Ltd
Beijing Bingshan Serial Refrigeration Equipment Co., Ltd Sales of goods 650,900.00 1,249,788.89
Beijing Huashang Bingshan Serial Refrigeration Equipment
Sales of goods 64,232,868.76 33,805,364.72
Co., Ltd
Dalian Fuji Bingshan Vending Machine Co., Ltd Sales of goods 18,409,705.00 2,991,827.62
107
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Details of
Names of the related parties transaction 2015 2014
Dalian Mahe Level Control Electrical Appliances Co., Ltd Sales of goods 52,355.30 106,730.07
Dalian Bingshan Metal Technology Co., Ltd Sales of goods 84,149.31 136,573.08
Daliian Sanyo High-Efficient Refrigeration System Co., Ltd Sales of goods 421,892.88 509,530.14
MHI Bingshan Refrigeration (Dalian) Co.,Ltd Sales of goods 7,621,072.14 3,334,001.80
Dalian Honjo Chemical Co., Ltd Sales of goods 15,219.80
Keinin-Grand Ocean Thermal Technology (Dalian) Co., Ltd. Sales of goods 766,404.00
Changzhou Jingxue Freezing Equipment Co., Ltd. Sales of goods 105,270.84
Dalian Spindle Cooling Towers Co., Ltd Sales of goods 1,474,155.53
Total 298,176,703.66 179,268,853.47
(4) Leasing fee from related party
Rental income of Rental income of
Lessee Leasing assets current year previous year
Dalian Bingshan Group Co., Ltd. Offices 103,680.00 103,680.00
MHI Bingshan Refrigeration (Dalian) Co.,Ltd. Workshops 4,200,000.00 1,575,000.00
Dalian Bingshan Engineering & Trading Co. , Ltd Offices 124,740.00
Total 4,428,420.00 1,678,680.00
Leasing fee to related party
Rental fees of Rental fees of
Leaser Leasing assets current year previous year
Dalian Bingshan Group Co., Ltd. Offices 142,572.00 142,572.00
Total 142,572.00 142,572.00
The Company signed a leasing agreement with Dalian Bingshan Group Co., Ltd., and leased 576
㎡ of offices to Dalian Bingshan Group Co., Ltd. The rental of offices is RMB 103,680.00 per year,
and the effective period of the contract is 2 years.
The Company rent office and garage of Dalian Bingshan Group Co., Ltd., and the rental is
RMB142,572.00 per year for 3 years.
The company signed rental contract with MHI Bingshan Refrigeration (Dalian) Co.,Ltd., and rent #
6 workshop building located on No. 106 Liaohe East Rd, Dalian Economic and Technology
Development Zone to MHI Bingshan Refrigeration (Dalian) Co.,Ltd. The rental area is 15,259.04
㎡, and annual rent is RMB 4.2 million since 15th August, 2014 to 16th July, 2029.
The Company signed a leasing agreement with Dalian Bingshan International Trade Co. , Ltd., and
leased 693 ㎡ of offices to Dalian Bingshan International Trade Co. , Ltd. The rental of offices is
RMB 124,740.00 per year, and the effective period of the contract is 2 years.
(5) No guarantee with related companies.
(6) The borrowing of funds from related party
Name of the related party Amount Starting date Ending date Explanation
Dalian Bingshan Group Co., Borrowed for moving to new
10,000,000.00 2006.09
Ltd. location
Total 10,000,000.00
108
Dalian Refrigeration Co., Ltd. 2015 Annual Report
The Company’s subsidiary Dalian Bingshan Ryosetsu Quick Freezing Equipment Co., Ltd.
borrowed RMB 10,000,000.00 from Dalian Bingshan Group Co., Ltd. for moving to new location,
and the interests are counted same as bank loan and interest RMB547,083.33 paid during the current
period.
The Company’s subsidiary Wuhan New World Refrigeration Industrial Co., Ltd. (“WNWRI”)
borrowed RMB 15,500,000.00 from Dalian Bingshan Group Co., Ltd. for constrution project, and
the interests are counted same as bank loan and interest RMB483,611.11 paid during the current
period. At the end of the current year, the loan was paid back.
7 Related party asset transfer and debt restructuring
Not applicable.
8 Rewards for the key management personnel
Items 2015 2014
Total rewards for the key management
3,753,800.00 3,063,100.00
person ( tax included)
9 Other transactions between the Company and the related parties
Transaction type Name of the related party 2015 2014 Pricing and decision
procedure
Shareholding Resolution of Board of
Dalian Bingshan Group Co., Ltd. 25,861,136.84 2,281,000.00
transfer Directors
Shareholding Dalian Bingshan Group Import & Resolution of Board of
6,024,000.00
transfer Export Co. , Ltd Directors
Total 31,885,136.84 2,281,000.00
(1) According to the 18th meeting of the 6th session of the Company’s Board of Directors, the
Company was transferred 19% shareholdings of Wuhan New World Refrigeration Industrial Co.,
Ltd. (“WNWRI”) from Dalian Bingshan Group Co., Ltd.with the price of RMB25,861,136.84.
(2)According to the 20th meeting of the 6th session of the Company’s Board of Directors, the
Company was transferred 40% shareholdings of Bingshan Technical Service （Dalian） Co.,Ltd.
from Dalian Bingshan International Trade Co.,Ltd. with the price of RMB 6,024,000.00.
10 Amounts due from/to related parties
(1) Accounts receivable
31-12-2015 31-12-2014
Names of the related parties Provision for Provision for
Amount bad debts Amount bad debts
Panasonic Compressor (Dalian) Co., Ltd. 265,820.40 27,166.02 91,852.00 7,367.60
Panasonic Refrigeration (Dalian) Co., Ltd. 5,473,096.64 273,654.83 2,735,787.19 136,789.36
Panasonic Cold-chain (Dalian) Co., Ltd. 25,195,419.27 1,259,770.96 2,082,509.89 109,302.98
Dalian Bingshan Engineering & Trading Co., Ltd. 3,410,519.80 170,525.99 1,155,043.14 57,752.16
109
Dalian Refrigeration Co., Ltd. 2015 Annual Report
BAC Dalian Co., Ltd. 112,420.00 5,621.00 5,600.00 280.00
Beijing Bingshan Serial Refrigeration Equipment
484,253.52 24,212.68 378,597.55 18,929.88
Co., Ltd.
Dalian Bingshan – P&A Recreation Development
24,430.00 2,443.00 215,180.00 10,759.00
Engineering Ltd.
Beijing Huashang Bingshan Refrigeration and
40,803,001.99 2,093,750.10 3,713,359.64 220,467.98
Air-conditioning Machinery Co., Ltd.
Dalian Fuji Bingshan Vending Machine Co., Ltd. 10,776,362.22 538,818.11 318,714.88 15,935.74
Dalian Sanyo High-Efficient Refrigeration System
142,907.59 7,145.38
Co., Ltd.
MHI Bingshan Refrigeration (Dalian) Co.,Ltd. 28,989.23 1,449.46 461,942.00 23,097.10
Dalian Spindle Cooling Towers Co., Ltd 917,881.08 45,894.05
Dalian Third Refrigeration Equipment Factory 5,642.60 282.13
(2)Notes receivable
Names of the related parties 31-12-2015 31-12-2014
Panasonic Compressor (Dalian) Co., Ltd 1,052,980.08 1,868,896.93
Dalian Bingshan Group Import & Export Co. , Ltd 9,847,217.00
BAC Dalian Co., Ltd 100,000.00
Panasonic Cold Chain (Dalian) Co., Ltd 20,163,705.41 1,875,903.71
Panasonic Refrigeration (Dalian) Co., Ltd 2,909,535.58 227,535.94
Beijing Bingshan Serial Refrigeration Equipment Co., Ltd 1,100,000.00 2,000,000.00
Beijing Huashang Bingshan Refrigeration and Air-conditioning Machinery
4,000,000.00 5,000,000.00
Co., Ltd
MHI Bingshan Refrigeration (Dalian) Co.,Ltd. 6,294,283.14
Dalian Spindle Cooling Towers Co., Ltd 1,494,656.98
(3) Accounts paid in advance
Names of the related parties 31-12-2015 31-12-2014
Beijing Huashang Bingshan Refrigeration and Air-conditioning Machinery
378,268.10
Co., Ltd.
Dalian Bingshan International Trading Co. , Ltd 18,068,922.66 2,698,283.12
Changzhou Jingxue Freezing Equipment Co., Ltd. 268,714.00
(4) Other accounts receivable
31-12-2015 31-12-2014
Name of the related party Provision
Provision for
Amount Amount for bad
bad debts
debts
Panasonic Cold-chain (Dalian) Co., Ltd. 137,520.50 6,876.03
(5) Notes payable
110
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Names of the related parties 31-12-2015 31-12-2014
Dalian Bingshan Group Co., Ltd. 760,794.55
Dalian Bingshan Group Refrigeration Equipment Co., Ltd. 6,897,040.82 8,000,000.00
BAC Dalian Co., Ltd. 1,600,000.00 700,000.00
Dalian Bingshan Group Materials Trading Co. , Ltd. 1,597,350.00
Dalian Bingshan Group Import & Export Co. , Ltd. 2,543,514.28 649,748.52
Dalian Third Refrigeration Equipment Factory 2,730,000.00 300,000.00
Dalian Sanyo High-Efficient Refrigeration System Co., Ltd. 600,000.00
Dalian Spindle Cooling Towers Co., Ltd. 1,107,249.00 52,000.00
Changzhou Jingxue Freezing Equipment Co., Ltd. 4,227,728.00
Panasonic Compressor (Dalian) Co., Ltd 136,199.00
Dalian Bingshan Metal Processing Co., Ltd. 100,000.00
(6) Accounts payable
Names of the related parties 31-12-2015 31-12-2014
Dalian Third Refrigeration Equipment Factory 3,437,911.21 1,507,966.95
BAC Dalian Co., Ltd. 40,548,590.02 21,593,357.00
Dalian Bingshan Group Refrigeration Equipment Co., Ltd. 8,860,105.57 6,536,438.32
Panasonic Refrigeration (Dalian) Co., Ltd. 195,000.00
Panasonic Cold Chain (Dalian) Co., Ltd. 32,804,524.70 12,531.00
Dalian Sanyo Meica Electronics Co., Ltd. 114,905.11 221,236.85
Dalian Spindle Cooling Towers Co., Ltd. 344,750.00 269,499.00
Dalian Bingshan Engineering & Trading Co., Ltd. 5,671,660.46 2,849,467.19
Panasonic Compressor (Dalian) Co., Ltd. 45,650.00 25.50
Changzhou Jingxue Freezing Equipment Co., Ltd. 5,742,746.00
Dalian Bingshan Metal Technology Co., Ltd. 222,692.68 251,907.04
Dalian Sanyo High-Efficient Refrigeration System Co., Ltd. 792,639.78
(7) Accounts received in advance
Names of the related parties 31-12-2015 31-12-2014
Dalian Bingshan Engineering & Trading Co., Ltd. 79,008.70 394,474.36
Beijing Huashang Bingshan Refrigeration and Air-conditioning Machinery
352,929.50
Co., Ltd.
MHI Bingshan Refrigeration (Dalian) Co.,Ltd. 5,850.00
Panasonic Cold Chain (Dalian) Co., Ltd. 1,466,923.23
(8) Other accounts payable
Names of the related parties 31-12-2015 31-12-2014
Dalian Bingshan Group Co., Ltd. 10,412,056.06 10,015,792.27
Dalian Third Refrigeration Equipment Factory 1,000.00 1,000.00
Dalian Bingshan Engineering & Trading Co., Ltd. 346.00 17,441.44
MHI Bingshan Refrigeration (Dalian) Co.,Ltd. 152,371.59 475,863.95
Beijing Huashang Bingshan Refrigeration and
61,241.27
Air-conditioning Machinery Co., Ltd.
111
Dalian Refrigeration Co., Ltd. 2015 Annual Report
11 Related party commitment
To ease the construction fund demand pressures of Wuhan New World Refrigeration Industry Co.,
Ltd. a wholly owned subsidiary company, Dalian Bingshan Group Co., Ltd. using its own funds to
provide loan to Wuhan New World Refrigeration Industry Co., Ltd. not exceed RMB20 million
yuan for not more than 12 months with the same period bank loans interest rates.
Ⅻ. Stock payment
1.The Stock payment overall situation
The current total equity instruments granted to the company 10,150,000.00
Amount of the equity instruments company right of this line 10,150,000.00
Company current total failure of the equity instruments 0.00
RMB5.56 per share，3 remaining contract
The granted price and remaining contract term of the restricted shares
terms were 12 months, 24 months and 36
outstanding at the end of current year
months
2.The Stock payment settled by equity
The determined methods of the fair value of the equity
Fair value of the stock on the granted date
instruments granted to date
Determine the number of vested equity instruments Actual number of exercised
This estimate and it is estimated that there are significant
No
differences of the previous period
Equity-settled share-based payment included in the total amount
12,190,520.00
of capital reserves
This period of equity-settled share-based payment confirmation
12,190,520.00
total costs
According to the the 13th and 15th Meeting of 6th Session of the Board of Directors of the
Company, and the Listed Company Equity Incentive Management Measures (Trial), and the
authorization of 1st Extraordinary Shareholders’ General Meeting of 2015, the Board convinced that
the granting conditions according to restricted stock incentive plan of the Company have been
achieved, thus agreed to make the grant day on March 4, 2015, and granted 10,150 ,000 shares
restricted stock to the incentive object.
XIII.Commitments and Contingency
1 No major commitments to be disclosed at the end of year 2015.
2 No other contingency needed disclosed at the end of year 2015.
XIV. Post balance sheet issues
1 Significant events had not adjusted
(1) Issue shares
The company received the “Reply of Approval for the Non-Public Issuance of A Stocks by Dalian
Refrigeration Co., Ltd. from CSRC on December 31, 2015. The company has been approved to
issue no more than 38,821,954 new shares. The approval will remain available in six months since
the date when it was granted.
(2)Investment
Not investment.
(3)Subsidiary absorbing and merging subsidiary
Resolution of 15th meeting of 6th session of the Board of directors agreed the Company’s
subsidiary Dalian Bingshan Ryosetsu Quick Freezing Equipment Co., Ltd. plans to absorb and
merge Dalian Bingshan Metal Processing Co., Ltd. The benchmark date for absorbing and merging
was made on 31st December 2014. After absorbing and merging, Dalian Bingshan Ryosetsu Quick
Freezing Equipment Co., Ltd. will be the surviving company. The Company will hold 95%
shareholders of Dalian Bingshan Ryosetsu Quick Freezing Equipment Co., Ltd.Until the report date,
the above absorbing and merging was processing.
112
Dalian Refrigeration Co., Ltd. 2015 Annual Report
(4)Significant lawsuit, arbitration and commitment
Not applicable.
(5)Others
The Company received the notice from the controlling shareholder Dalian Bingshan Group Co., Ltd.
(“Bingshan Group”) on February 22, 2016. Bingshan Group have increased holdings of 1,000,000 A
shares of the Company through the Shenzhen stock exchange securities trading system on February
22, 2016, accounting for about 0.28% of the total issued shares of the Company. Before the
increased holdings, Bingshan Group held 76,855,683 shares of the Company, accounting for about
21.34% of the total issued shares of the Company. After the increased holdings, Bingshan Group
hold 77,855,683 shares of the Company, accounting for about 21.62% of the total issued shares of
the Company.
Resolution of 2nd meeting of 7th session of the Board of directors agreed to provide guarantee to
Dalian Bingshan Group Co., Ltd. for obtaining Development Fund of National Development
Bank.Total amount of the loan was RMB120 million with interest rate 1.2%, and the loan period
was 10 years. The fund can only be used for cold chain green intelligent equipment and the
development of service industry.When Dalian Bingshan Group Co., Ltd.recieves the fund, they will
transfer all the fund to the company with the same conditions.
2 Information about profit distribution of post balance sheet
Items Amount
Dividend proposed to be distributed after balance sheet date 36,016,497.50
Dividend approved to be distributed by the General Meeting
Board of directors proposed to withdraw the other reserved capital on the basis of 20% of the
Company’s net profit and distribute cash dividend of RMB 0. 1 per share and using capital surplus
RMB0.5 per share to add capital , the cash dividend of B shareholders will be converted to Hong
Kong dollar and paid.The dividend was calculated according to the total share capital after share
granted i.e. 360,164,975 shares, and it was not recognized as a liability on the financial statements
in current report period.
3 Significant sales return after balance sheet day
Not applicable.
4 There was no other post balance sheet significant events except above mentioned.
XV. Other important things needed disclosed.
1 There was no corrections of prior period accounting errors during the current period.
2 Debt restructing during the current period.
During the reporting period, the company signed a creditor's rights transfer agreement with Dalian
Xinghaiwan Development and Construction Management Center and Dalian Ganghe Economic and
Trade Co., Ltd., and the company losses RMB586,377.00 in this debt restructuring.
3There was no assets exchange during the current period.
4The Company didn’t design employer pension plan.
5 There was no discontinuing operation during the current period.
6 Segment information
(1) Standards and accounting policies of reporting segment
The company determines operating segment according to its organization structure, management
rules, inside reporting system. The operating segment should satisfy following conditions:
① The operating segment could generate income and incure expenses from normal operating
activities；
②The management could evaluate its operating effect, and then decide resources assignment and its
113
Dalian Refrigeration Co., Ltd. 2015 Annual Report
operating performance；
③The segment’s information of financial position and results of operations and cash flow could be
obtained.
The company determines reporting segment based on operating segments. The reporting segment
should satisfy one of the following conditions:：
① The operating segment’s income should be over 10% of total income；
② The number of the operating segment’s profit(or loss) should be over 10% of the number of total
profit and the number of total losses.
The transfer prices between segments were decided according to the market prices.The expenses of
common assets usedby segments and other common expenses shoude be divided among the
segments according to the income.
(2) Elements of determining reporting segment and types of reporting segments’ products and
services
The company determined three reporting segments according to the geogeriphic area, including
Northeast China, Central China and East China. The Northeast China segment included the
company’s head office and subsidiaries located in Dalian. The Central China segment included
subsidiary company Wuhan New World Refrigeration Industrial Co., Ltd. And the East China
segment included subsidiary’s subsidiary company Ningbo Bingshan Refrigeration Air Conditioner
Engineering Co., Ltd.
(3) The financial information of reporting segments(unit: RMB10 million)
31-12-2015/2015
Items Northeast
Central China East China Offset Total
China
1 Operating income 187,030.09 25,728.41 3,817.19 55,823.84 160,751.85
Including:Income from external
143,011.97 15,948.33 1,791.55 160,751.85
transaction
Income from internal
44,018.12 9,780.08 2,025.64 55,823.84
transaction
2 Selling expenses 172,737.59 26,680.89 3,812.12 55,552.28 147,678.32
Including:Investment income
from associates and joint 12,566.39 0.69 12,567.08
ventures
Impairment on assets 982.91 728.69 0.76 1,712.36
Depreciation and
3,363.82 1,067.73 12.01 4,443.56
amortization
3 Operating profits(loss) 14,644.95 -847.98 230.17 432.38 13,594.76
4 Income tax 456.95 -39.69 56.00 473.26
5 Net profit(loss) 14,188.00 -808.28 174.16 432.38 13,121.50
6 Total assets 405,212.84 49,854.55 2,435.96 49,253.36 408,249.99
7 Total liabilities 121,861.60 37,074.47 1,827.56 23,900.31 136,863.32
8 Other significant non cash
28,755.40 3,088.38 44.27 1,555.58 30,332.47
items
Capital expenditure 28,755.40 3,088.38 44.27 1,555.58 30,332.47
The accounting policies of every operating segment were the same with described in the note
IV.The main accounting policies, accounting estimates and corrections of accounting errors.
7 There was no significant event which would affect the decision of investor during the current
period.
114
Dalian Refrigeration Co., Ltd. 2015 Annual Report
XVI.Notes to the financial statements of the parent company
1 Accounts receivable
(1) Classified by accounts nature
31-12-2015
Categories Balance Provision for doubtful debt
Book value
Amount Proportion (%) Amount Proportion (%)
Major single amount and
bad debt provision
provided individually
Bad debt provided on
262,260,040.72 100 65,568,099.85 25.00 196,691,940.87
group basis
Minor single amount but
bad debt provision
provided individually
Total 262,260,040.72 100 65,568,099.85 25.00 196,691,940.87
Continued:
31-12-2014
Categories Balance Provision for doubtful debt
Book value
Amount Proportion (%) Amount Proportion (%)
Major single amount and
bad debt provision
provided individually
Bad debt provided on
277,119,839.64 100 71,812,337.04 25.91 205,307,502.60
group basis
Minor single amount but
bad debt provision
provided individually
Total 277,119,839.64 100 71,812,337.04 25.91 205,307,502.60
Accounts receivable which bad debt provisions are provided on age basis in the group
31-12-2015
Account ages
Amount Provision for bad debts Proportion rates (%)
Within 1 year 90,757,943.34 3,075,608.37 5
1 to 2 years 80,772,588.11 8,077,258.81 10
2 to 3 years 32,194,417.23 9,658,325.17 30
3 to 4 years 23,806,468.74 11,903,234.37 50
4 to 5 years 9,374,750.85 7,499,800.68 80
Over 5 years 25,353,872.45 25,353,872.45 100
Total 262,260,040.72 65,568,099.85
(2) Provision for bad debts accrued, regain or switch back in the period
In the current period, RMB-4,997,926.80 were accrued provision for bad debts, and no amount
was switched back or regained.
(3) The write-off of accounts receivable during the reporting period
115
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Items Written off amount
14 clients 1,246,310.39
The reasons of accounts receivable write-off include termination of operation and disability of
payment, winning lawsuits but not finding executable assets, small balance not being collected for
long time, and disagreement rework charges etc.
(4) Accounts receivable top 5 on amount
Provision for bad
Companies Amount Proportion(%)
debts
Dalian Bingshan Group Sales Co., Ltd. 29,245,775.90 11.15
Beijing Huashang Bingshan Refrigeration and
12,971,857.08 4.95 805,266.16
Air-conditioning Machinery Co., Ltd.
Beidahuang Taihua Organic Foods Co., Ltd. 9,068,326.88 3.46 453,416.34
COFCO Meat (Suqian) Co., Ltd. 7,178,265.85 2.74 3,557,470.93
Yidu (Shenyang) Cold-chainLogistics
6,463,166.00 2.46 608,297.57
Development Co., Ltd.
Total 64,927,391.71 24.76 5,424,451.00
2 Other accounts receivable
(1) Classified by account nature
31-12-2015
Items Balance Provision for doubtful debt
Book value
Amount Proportion (%) Amount Proportion (%)
Major single amount and bad debt
provision provided individually
Bad debt provided on group basis 45,196,469.56 100 1,504,857.11 3.33 43,691,612.45
Minor single amount but bad debt
provision provided individually
Total 45,196,469.56 100 1,504,857.11 3.33 43,691,612.45
Continued：
31-12-2014
Items Balance Provision for doubtful debt
Book value
Proportion Proportion
Amount Amount
(%) (%)
Major single amount and bad
debt provision provided
individually
Bad debt provided on group
basis 23,056,627.39 100 1,790,721.85 7.77 21,265,905.54
Minor single amount but bad
debt provision provided
individually
Total 23,056,627.39 100 1,790,721.85 7.77 21,265,905.54
Other accounts receivable which bad debt provisions are provided on age basis in the group
116
Dalian Refrigeration Co., Ltd. 2015 Annual Report
31-12-2015
Account ages
Amount Provision for bad debts Proportion rates (%)
Within 1year 35,185,120.47 72,797.27 5
1 to 2 years 8,817,850.99 881,785.10 10
2 to 3 years 659,047.48 197,714.24 30
3 to 4 years 250,000.00 125,000.00 50
4 to 5 years 284,450.62 227,560.50 80
Total 45,196,469.56 1,504,857.11
(2) Provision for bad debts accrued, regain or switch back in the period
In the current period, RMB-274,276.24 were accrued provision for bad debts, and no amount was
switched back or regained.
(3)The write-off of other accounts receivable during the reporting period
Items Written off amount
2 clients 11,588.50
(4) The nature of other accounts receivable
Items 31-12-2015 31-12-2014
Guarantee deposits 11,391,139.57 20,951,410.09
Petty cash 76,154.99 97,241.00
To or fro accounts 33,729,175.00
Prepayments over settlement periods 2,007,976.30
Total 45,196,469.56 23,056,627.39
(5) Top 5 on amount of other accounts receivable
Ending
Proportion balance of
Companies Nature Amount Ages
(%) provision for
bad debts
Wuhan New World
To or fro Less than 1
Refrigeration Industrial Co., 33,729,175.00 74.63
accounts year
Ltd.
Dalian Tianbao Green Performance
8,000,000.00 1 to-2 years 17.70 800,000.00
Foods Co., Ltd. bonds
Less than 1
Dalian Jinzhou District year ，1-2
Guarantee
Building Energy Save 1,852,574.57 years,2-3 4.10 315,242.86
deposits
Administration Office years，4-5
years
Dalian Construction Project Wage depodits
Labour Insurance Expenses of migrant 500,000.00 2 to 3 years 1.11 150,000.00
Administration Center workers
Dalian Detai Ganghua Gas Guarantee
400,000.00 1 to 2 years 0.89 40,000.00
Co., Ltd. deposits
Total 44,481,749.57 98.43 1,305,242.86
(6) The reason of the ending balance of other accounts receivable increased 105.45% compared
with the beginning balance was amount due from Wuhan New World Refrigeration Industrial Co.,
117
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Ltd. increased.
3 Long-term equity investments
31-12-2015 31-12-2014
Nature Provision
Provision for
Book balance for Book value Book balance Book value
impairment
impairment
Subsidiaries 246,597,906.16 246,597,906.16 107,629,071.42 107,629,071.42
Joint ventures&
1,214,360,893.12 1,214,360,893.12 1,039,229,738.85 1,039,229,738.85
affiliated companies
Total 1,460,958,799.28 1,460,958,799.28 1,146,858,810.27 1,146,858,810.27
118
Dalian Refrigeration Co., Ltd. 2015 Annual Report
(1) Subsidiaries
Provision for Provision for
Increased during Decreased during
Names Initial cost Beginning balance Ending balance impairment of the
current year current year
current period impairment
Dalian Bingshan Group Engineering Co., Ltd. 22,749,675.77 20,036,841.62 2,712,834.15 22,749,675.77
Dalian Bingshan Group Sales Co., Ltd. 12,936,700.00 12,936,700.00 12,936,700.00
9,249,900.00 21,751,244.60
Dalian Bingshan Metal Processing Co., Ltd. 21,751,244.60 12,501,344.60
Dalian Bingshan Air-conditioning Equipment Co., Ltd. 36,506,570.00 36,506,570.00 36,506,570.00
Dalian Bingshan Guardian Automation Co., Ltd. 1,522,117.80 1,522,117.80 1,522,117.80
Dalian Bingshan Ryosetsu Quick Freezing Equipment Co., Ltd. 5,745,097.40 5,745,097.40 5,745,097.40
Wuhan New World Refrigeration Industrial Co., Ltd. 66,694,510.81 84,674,910.81
84,674,910.81 17,980,400.00
Wuhan New World Refrigeration Air Conditioner Engineering Co., Ltd. 400,000.00 400,000.00 400,000.00
Bingshan Technical Service （Dalian） Co.,Ltd. 12,024,000.00 12,024,000.00
12,024,000.00
Dalian Sanyo High-Efficient Refrigeration System Co., Ltd.
48,287,589.78 48,287,589.78 48,287,589.78
Total 246,597,906.16 107,629,071.42 138,968,834.74 246,597,906.16
(2) Joint ventures& associated companies
Increase/Decreas
Provision Provision
Adjustment of Cash bonus or for for
Names Beginning balance Gains and losses Changes Ending balance
other profits impairment impairme
Increased Decreased recognized under of other Others nt
comprehensiv announced to of the
the equity method equity
e income issue current
period
1. Joint ventures
Dalian Bingshan – P&A Recreation 3,553,919.97 -716,822.16 2,837,097.81
Development Engineering Co., Ltd.
2,837,097.81
Subtotal 3,553,919.97 -716,822.16
2. Associated companies
119
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Increase/Decreas
Provision Provision
Adjustment of Cash bonus or for for
Names Beginning balance Gains and losses Changes Ending balance
other profits impairment impairme
Increased Decreased recognized under of other Others nt
comprehensiv announced to of the
the equity method equity
e income issue current
period
Dalian Bingshan International
13,716,985.57 1,974,116.05 15,691,101.62
Trade Co. , Ltd.
Panasonic Refrigeration (Dalian)
155,826,086.27 8,600,021.37 5,200,000.00 159,226,107.64
Co., Ltd.
Dalian Honjo Chemical Co., Ltd. 9,403,913.18 528,860.67 1,203,061.37 8,729,712.48
Panasonic Cold-chain (Dalian)
215,573,606.48 8,145,919.40 8,000,000.00 215,719,525.88
Co., Ltd.
Keinin-Grand Ocean Thermal
42,333,942.39 15,873,092.90 9,600,000.00 48,607,035.29
Technology (Dalian) Co., Ltd.
Panasonic Compressor (Dalian)
432,515,006.40 59,377,362.52 34,000,000.00 457,892,368.92
Co., Ltd.
Dalian Sanyo Meica Electronics
23,233,848.71 -1,275,779.47 21,958,069.24
Co., Ltd.
MHI Bingshan Refrigeration
29,294,087.63 -7,017,754.79 22,276,332.84
(Dalian) Co.,Ltd.
Beijing Huashang Bingshan
Refrigeration and Air-conditioning 1,425,989.62 1,754,200.00 -1,243,542.64 1,936,646.98
Machinery Co., Ltd.
Dalian Fuji Bingshan Vending
89,896,843.61 28,686,407.19 5,314,796.52 113,268,454.28
Machine Co., Ltd.
Daliian Sanyo High-Efficient
22,455,509.02 26,993,388.94 -1,161,308.18 -48,287,589.78
Refrigeration System Co., Ltd.
Changzhou Jingxue Freezing
130,000,000.00 11,722,024.61 141,722,024.61
Equipment Co., Ltd.
Beijing Huashang Bingshan Serial
2,450,000.00 2,044,158.79 2,256.74 4,496,415.53
Refrigeration Equipment Co., Ltd.
Subtotal 1,035,675,818.88 161,197,588.94 126,253,578.42 2,256.74 63,317,857.89 -48,287,589.78 1,211,523,795.31
Total 1,039,229,738.85 161,197,588.94 125,536,756.26 2,256.74 63,317,857.89 -48,287,589.78 1,214,360,893.12
120
Dalian Refrigeration Co., Ltd. 2015 Annual Report
4 Total operating income and operating cost
2015 2014
Items
Income Cost Income Cost
Key business 529,921,896.78 439,578,679.65 815,254,802.52 637,291,434.88
Other business 11,553,354.87 7,030,947.50 16,432,936.80 18,219,326.55
Total 541,475,251.65 446,609,627.15 831,687,739.32 655,510,761.43
5 Gain/ (loss) from investments
Items 2015 2014
Gain arising from dividends of subsidiaries 3,915,784.39 4,135,112.47
Long-term equity investment income accounted for by using the equity
125,536,756.26 101,428,429.25
method
Gain on selling equity of associate company 1,980,516.41
Gain from holding of financial assets available for sale 3,319,889.50 1,754,944.75
Gain from disposal financial assets available for sale 36,617.40
Total 132,772,430.15 109,335,620.28
XV. Other supplementary Information
1 Non-recurring profits and losses
Non-recurring gains and losses items Amount Notes
1. Gain/loss from disposal of non-current assets -61,718.74
2.Tax return or exemption exceeding authority or without formal authorization
499,945.82
documents
3.Governmental subsidy written into current gains and losses 1,906,070.56
4. Interest from non-financial enterprises written into current gains and losses
5.Gains/Losses on debt restructuring -586,377.00
6.Reversal of provision for impairment of long-term assets
7.Gain/loss from change of fair value of transactional asset and liabilities, and
investment gains from disposal of transactional financial assets and liabilities
and sellable financial assets, other than valid period value instruments related to
the Company’s common businesses.
8.Other net income and expense from non-operation 2,896,432.61
Total 4,654,353.25
Less：Affected amount of income tax from non-recurring gains and losses 671,259.97
Net amount of non-recurring gains and losses 3,983,093.28
Included: Attributable to minority shareholders’ equity 158,595.14
Attributable to the owners of parent company 3,824,498.14
2 Earnings per share
121
Dalian Refrigeration Co., Ltd. 2015 Annual Report
The weighted EPS
Items
average ROE(%) Basic EPS Diluted EPS
Net profit attributable to the Company’s ordinary 6.38 0.36 0.36
shareholders
Net profit attributable to the Company’s ordinary
shareholders after deducting non-recurring gains and 6.19 0.35 0.35
losses
3 The differences between domestic and international accounting standards
There was no significant differences between domestic and international accounting standards
among the Company’s financial statements of the current period.
122
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Section 11 Reference Documents
1. The accounting statements bearing the signatures and seals of the legal representative, the
financial majordomo and the accountants in charge.
2. The original copy of the auditor's report bearing the seal of the certified public accountants and
the signatures and seals of the certified accountants.
3. The original copies of all the Company's documents and the original copies of the bulletins
published on the newspapers designated by the China Securities Regulatory Commission in the
report period.
4. Time for reference: from Monday to Friday 8:00 - 12:00 (am) 1:00 - 5:00 (pm)
Liaison persons: Mr. Song Wenbao，Miss Du Yu
Tel: 0086-411-86538130
Fax: 0086-411-86654530
Dalian Refrigeration Company Limited
29th March, 2016
123
Dalian Refrigeration Co., Ltd. 2015 Annual Report
BALANCE SHEET
Prepared by Dalian Refrigeration Co., Ltd. December 31, 2015 Unit: RMB Yuan
31-Dec-2015 31-Dec-2014
Assets
Consolidation Parent Company Consolidation Parent Company
Current assets:
Monetary funds 244,789,824.53 149,314,329.13 508,511,466.02 407,573,197.89
Financial assets which are measured by fair value and
which changes are recorded in current profit and loss
Derivative financial assets
Notes receivable 71,699,517.68 40,690,578.22 14,855,957.70 15,711,896.93
Accounts receivable 671,423,836.87 196,691,940.87 438,880,830.12 205,307,502.60
Accounts in advance 44,218,887.91 22,523,974.19 19,053,269.75 8,470,706.14
Interest receivables 4,998,982.40 4,998,982.40
Dividend receivable 44,600.00 - -
Other receivables 22,755,328.21 43,691,612.45 34,266,444.02 21,265,905.54
Inventories 259,099,149.47 122,212,395.56 314,879,106.56 164,069,128.20
Assets held for sale
Non-current asset due within one year
Other current assets 16,478,711.86 7,918,692.08 2,335,139.79 1,659,559.91
Total current assets 1,330,509,856.53 583,043,522.50 1,337,781,196.36 829,056,879.61
Non-current assets:
Finance asset held available for sales 733,275,249.09 731,960,106.59 42,428,388.70 41,113,246.20
Held-to-maturity investment
Long-term account receivable
Long-term equity investment 1,220,367,767.73 1,460,958,799.28 1,039,229,738.85 1,146,858,810.27
Investment property 24,497,584.00 24,497,584.00 25,108,909.00 25,108,909.00
Fixed assets 449,907,430.32 246,435,789.69 414,293,269.31 239,721,541.76
Construction in progress 137,025,384.58 109,277,419.44 18,515,449.46 18,280,777.19
Engineering material
Disposal of fixed asset
Productive biological asset
Oil and gas asset
Intangible assets 158,417,802.57 90,015,524.05 153,913,310.25 89,919,836.54
Expense on Research and Development
Goodwill 1,440,347.92
Long-term expenses to be apportioned 5,857,504.95 5,033,031.30 5,873,398.99 5,537,394.66
Deferred income tax asset 21,200,936.73 8,675,787.57 16,786,587.33 8,054,057.26
Other non-current asset
Total non-current asset 2,751,990,007.89 2,676,854,041.92 1,716,149,051.89 1,574,594,572.88
Total assets 4,082,499,864.42 3,259,897,564.42 3,053,930,248.25 2,403,651,452.49
Legal Representative: Ji Zhijian Chief Financial Official: Ma Yun Person in Charge of Accounting Organization: Mao Chunhua
124
Dalian Refrigeration Co., Ltd. 2015 Annual Report
BALANCE SHEET (CONTINUED)
Prepared by Dalian Refrigeration Co., Ltd. December 31, 2015 Unit: RMB Yuan
31-Dec-2015 31-Dec-2014
Liabilities and shareholders’ equity
Consolidation Parent Company Consolidation Parent Company
Current liabilities:
Short-term loans 82,600,000.00 27,600,000.00 60,000,000.00
Derivative financial liabilities
Notes payable 234,189,011.72 177,683,261.74 109,546,502.61 66,979,512.02
Accounts payable 660,398,503.26 293,389,981.61 511,076,537.82 302,053,679.95
Accounts received in advance 70,458,014.46 25,768,511.15 137,629,315.42 96,325,866.23
Wage payable 51,857,345.29 11,208,398.45 55,993,637.27 13,854,152.86
Taxes payable 15,701,578.36 873,038.30 2,642,729.69 -2,710,393.15
Interest payable
Dividend payable 533,156.00 533,156.00 533,156.00 533,156.00
Other accounts payable 99,890,290.15 55,807,703.77 60,075,814.04 49,270,430.42
Liabilities held for sale
Non-current liabilities due within one year
Other current liabilities
Total current liabilities 1,215,627,899.24 592,864,051.02 937,497,692.85 526,306,404.33
Non-current liabilities:
Long-term loans
Bonds payable
Long-term account payable
Long-term wage payable
Special accounts payable
Projected liabilities
Deferred income 49,378,296.00 3,704,296.00 52,773,884.19 5,985,884.19
Deferred income tax liabilities 103,627,029.06 103,627,029.06
Other non-current liabilities
Total non-current liabilities 153,005,325.06 107,331,325.06 52,773,884.19 5,985,884.19
Total liabilities 1,368,633,224.30 700,195,376.08 990,271,577.04 532,292,288.52
Shareholders’ equity
Share capital 360,164,975.00 360,164,975.00 350,014,975.00 350,014,975.00
Other equity instruments
Capital public reserve 630,264,991.95 640,764,783.03 582,288,006.29 582,288,006.29
Specialized reserve 39,503,800.00 39,503,800.00
Other comprehensive income 589,988,118.05 588,759,190.43 2,768,286.72
1,539,359.10
Special preparation
Surplus public reserve 580,769,740.16 580,769,740.16 545,788,247.99
545,788,247.99
Retained profit 525,925,066.25 428,747,299.72 486,167,740.13 391,728,575.59
Translation of foreign currency capital
Total owner’s equity attributable to parent
2,647,609,091.41 2,599,702,188.34 1,967,027,256.131,871,359,163.97
company
Minority interests 66,257,548.71 96,631,415.08
Total owner’s equity 2,713,866,640.12 2,599,702,188.34 2,063,658,671.211,871,359,163.97
Total liabilities and shareholder’s equity 4,082,499,864.42 3,259,897,564.42 3,053,930,248.252,403,651,452.49
Legal Representative: Ji Zhijian Chief Financial Official: Ma Yun Person in Charge of Accounting Organization: Mao Chunhua
125
Dalian Refrigeration Co., Ltd. 2015 Annual Report
INCOME STATEMENT
Prepared by Dalian Refrigeration Co., Ltd. January-December, 2015 Unit: RMB Yuan
January-December, 2015 January-December, 2014
Items
Consolidation Parent Company Consolidation Parent Company
I. Total sales 1,607,518,439.61 541,475,251.65 1,425,715,596.96 831,687,739.32
Including: Operating income 1,607,518,439.61 541,475,251.65 1,425,715,596.96 831,687,739.32
II. Total operating cost 1,606,832,356.89 553,784,280.70 1,420,273,278.31 835,979,131.98
Including: Operating cost 1,309,843,811.63 446,609,627.15 1,086,550,652.73 655,510,761.43
Taxes and associate charges 12,588,252.81 2,499,783.19 11,709,558.03 4,827,468.68
Selling and distribution expenses 80,099,755.98 4,045,795.92 123,270,829.61 57,137,295.02
Administrative expenses 187,046,595.49 109,448,960.03 185,701,061.45 114,245,449.21
Financial expense 130,314.66 -3,914,069.63 -6,114,199.04 -10,417,316.17
Impairment loss 17,123,626.32 -4,905,815.96 19,155,375.53 14,675,473.81
Add: Gain/(loss) from change in fair value
Gain/(loss) from investment 128,908,120.37 132,772,430.15 103,940,832.81 109,335,620.28
Including: income form investment on affiliated
125,543,630.87 125,536,756.26 101,428,429.25 101,428,429.25
enterprise and jointly enterprise
III. Operating profit 129,594,203.09 120,463,401.10 109,383,151.46 105,044,227.62
Add: non-business income 7,459,363.54 5,314,670.19 15,166,450.39 12,165,875.28
Including: profit from non-current asset disposal 167,463.99 108,540.13 390,490.35 337,665.38
Less: non-business expense 1,105,912.29 302,694.05 561,532.64 236,615.58
Including: loss from non-current asset disposal 229,182.73 49,365.05 412,897.02 186,615.58
IV. Total profit 135,947,654.34 125,475,377.24 123,988,069.21 116,973,487.32
Less: Income tax 4,732,632.19 -549,585.31 9,468,787.48 5,078,507.78
V. Net profit 131,215,022.15 126,024,962.55 114,519,281.73 111,894,979.54
Net profit attributable to parent company 129,947,307.39 126,024,962.55 115,439,722.39 111,894,979.54
Minority shareholders’ gains and losses 1,267,714.76 -920,440.66
VI. After-tax net amount of other comprehensive
587,219,831.33 587,219,831.33 -15,000.00 -15,000.00
incomes
After-tax net amount of other comprehensive
587,219,831.33 587,219,831.33 -15,000.00 -15,000.00
incomes attributable to owners of the Company
(I) Other comprehensive incomes that will not be
reclassified into gains and losses
1. Changes in net liabilities or assets with a
defined benefit plan upon re-measurement
2. Enjoyable shares in other comprehensive
incomes in investees that cannot be reclassified
into gains and losses under the equity method
……
(II) Other comprehensive incomes that will be
587,219,831.33 587,219,831.33 -15,000.00 -15,000.00
reclassified into gains and losses
1. Enjoyable shares in other comprehensive
incomes in investees that will be reclassified into -15,000.00 -15,000.00
gains and losses under the equity method
2. Gains and losses on fair value changes of
587,219,831.33 587,219,831.33
available-for-sale financial assets
3. Gains and losses on reclassifying
held-to-maturity investments into
available-for-sale financial assets
4. Effective hedging gains and losses on cash
flows
5. Foreign-currency financial statement
translation difference
6. Other
126
Dalian Refrigeration Co., Ltd. 2015 Annual Report
……
After-tax net amount of other comprehensive
incomes attributable to minority shareholders
VII Total comprehensive income 718,434,853.48 713,244,793.88 114,504,281.73 111,879,979.54
Total comprehensive income attributable to
717,167,138.72 713,244,793.88 115,424,722.39 111,879,979.54
parent company
Total comprehensive income attributable to
1,267,714.76 -920,440.66
minority shareholders
VIII. Earnings per share --
(I) basic earnings per share 0.36 0.33
(II) diluted earnings per share 0.36 0.33
Legal Representative: Ji Zhijian Chief Financial Official: Ma Yun Person in Charge of Accounting Organization: Mao Chunhua
127
Dalian Refrigeration Co., Ltd. 2015 Annual Report
CASH FLOW STATEMENT
Prepared by Dalian Refrigeration Co., Ltd. January -December, 2015 Unit: RMB Yuan
January -December, 2015 January -December, 2014
Items Parent
Consolidation Company Consolidation Parent Company
I. Cash flows arising from operating activities:
Cash received from selling commodities and
1,196,653,392.32 389,780,864.03 1,090,103,866.93 649,803,180.34
providing labor services
Write-back of tax received 1,064,168.82 871,659.27
Other cash received concerning operating activities 43,260,055.50 24,780,873.67 37,350,278.00 26,001,801.17
Subtotal of cash inflow arising from operating
1,240,977,616.64 414,561,737.70 1,128,325,804.20 675,804,981.51
activities
Cash paid for purchasing commodities and
801,379,413.53 286,847,416.04 572,248,043.66 366,830,223.80
receiving labor service
Cash paid to/for staff and workers 278,537,533.58 110,830,881.99 276,307,722.58 152,130,182.41
Taxes paid 99,382,229.31 28,319,534.99 118,866,955.58 66,753,359.34
Other cash paid concerning operating activities 112,246,914.60 28,857,855.35 132,407,309.91 77,470,172.84
Subtotal of cash outflow arising from operating
1,291,546,091.02 454,855,688.37 1,099,830,031.73 663,183,938.39
activities
Net cash flows arising from operating activities -50,568,474.38 -40,293,950.67 28,495,772.47 12,621,043.12
II. Cash flows arising from investing activities:
Cash received from recovering investment 6,843,000.00 15,286,617.40 15,286,617.40
Cash received from investment income 66,637,747.39 68,332,980.68 42,461,536.50 43,204,338.19
Net cash received from disposal of fixed, intangible
287,315.00 106,580.00 10,147,370.00 10,005,000.00
and other 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
66,925,062.39 75,282,560.68 67,895,523.90 68,495,955.59
activities
Cash paid for purchasing fixed, intangible and other
60,687,631.79 38,025,775.39 48,206,418.04 40,255,232.98
long-term assets
Cash paid for investment 222,172,610.81 224,885,444.96 15,781,000.00 15,781,000.00
Net cash received from payment of subsidiaries and
20,464,427.15 26,993,388.94
other business units
Other cash paid concerning investing activities
Subtotal of cash outflow from investing
303,324,669.75 289,904,609.29 63,987,418.04 56,036,232.98
activities
Net cash flows arising from investing activities -236,399,607.36 -214,622,048.61 3,908,105.86 12,459,722.61
III. Cash flows arising from financing activities
Cash received from absorbing investment 60,434,000.00 56,434,000.00
Including: Cash received from absorbing minority
shareholders' equity investment by subsidiaries
Cash received from loans 129,000,000.00 27,600,000.00 67,510,000.00
Other cash received concerning financing activities 32,953,876.63 16,145,665.64 10,844,272.75 3,499,990.45
Subtotal of cash inflow from financing
222,387,876.63 100,179,665.64 78,354,272.75 3,499,990.45
activities
Cash paid for settling debts 106,500,000.00 44,010,000.00
Cash paid for dividend and profit distributing or
61,877,081.78 54,732,538.85 60,282,709.40 52,502,246.10
interest paying
Including: dividends or profit paid by subsidiaries
2,502,522.92 3,756,741.65
to minority shareholders
Other cash paid concerning financing activities 20,711,136.86 34,245,194.98 33,037,404.13 16,145,665.64
Subtotal of cash outflow from financing
189,088,218.64 88,977,733.83 137,330,113.53 68,647,911.74
activities
128
Dalian Refrigeration Co., Ltd. 2015 Annual Report
Net cash flows arising from financing activities 33,299,657.99 11,201,931.81 -58,975,840.78 -65,147,921.29
IV. Influence on cash due to fluctuation in
-165,031.04 -274,330.63 -209,608.51 38.62
exchange rate
V. Net increase of cash and cash equivalents -253,833,454.79 -243,988,398.10 -26,781,570.96 -40,067,116.94
Add: Balance of cash and cash equivalents at the
475,557,589.39 391,427,532.25 502,339,160.35 431,494,649.19
period -begin
VI. Balance of cash and cash equivalents at the
221,724,134.60 147,439,134.15 475,557,589.39 391,427,532.25
period–end
Legal Representative: Ji Zhijian Chief Financial Official: Ma Yun Person in Charge of Accounting Organization: Mao Chunhua
129
Dalian Refrigeration Co., Ltd. 2015 Annual Report
CONSOLIDATED STATEMENT OF CHANGES IN OWNERS’
EQUITY
Prepared by Dalian Refrigeration Company Limited 2015.01-12 Unit: RMB Yuan
2015.01-12
Owners’ equity attributable to parent company
Items Other Retained Minority Total of
Lessen: Special Surplus equity owners’ equity
share capital Capital suplus comprehensive profits
treasury stock reserve reserve
income
I. balance at the end of last year 350,014,975.00 582,288,006.29 2,768,286.72 545,788,247.99 486,167,740.13 96,631,415.08 2,063,658,671.21
1. Change of accounting policy
2. Correction of errors in previous
period
II. Balance at the beginning of this
350,014,975.00 582,288,006.29 2,768,286.72 545,788,247.99 486,167,740.13 96,631,415.08 2,063,658,671.21
year
III. Increase/ decrease of amount in
10,150,000.00 47,976,985.66 39,503,800.00 587,219,831.33 34,981,492.17 39,757,326.12 -30,373,866.37 650,207,968.91
this year (“-” means decrease)
(I) Total comprehensive incomes 587,219,831.33 129,947,307.39 1,267,714.76 718,434,853.48
(II) Capital increased and reduced by
10,150,000.00 47,976,985.66 39,503,800.00 -29,139,058.21 -10,515,872.55
owners
1. Common shares increased by
10,150,000.00 35,784,208.92 39,503,800.00 -29,139,058.21 -22,708,649.29
shareholders
2. Capital increased by holders of
other equity instruments
3. Amounts of share-based payments
12,190,520.00 12,190,520.00
recognized in owners’ equity
4. Other 2,256.74 2,256.74
(III) Profit distribution 34,981,492.17 -90,189,981.27 -2,502,522.92 -57,711,012.02
1. Withdrawing surplus public
34,981,492.17 -34,981,492.17
reserve
2. Distribution to all owners
-54,024,746.25 -2,502,522.92 -56,527,269.17
(shareholders)
3. Others -1,183,742.85 -1,183,742.85
(IV) Internal carrying forward of
owners’ equity
1. New increase of share capital
from capital reserves
2. Convert surplus reserves to share
capital
3. Surplus reserves make up losses
4. Others
(V) Specific reserve
1,982,950
1. Withdrawn for the period 1,982,950.50
.50
1,982,950
2. Used in the period 1,982,950.50
.50
(VI) Other
IV. Balance at the end of this period 360,164,975.00 630,264,991.95 39,503,800.00 589,988,118.05 580,769,740.16 525,925,066.25 66,257,548.71 2,713,866,640.12
Legal Representative: Ji Zhijian Chief Financial Official: Ma Yun Person in Charge of Accounting Organization: Mao Chunhua
130
Dalian Refrigeration Co., Ltd. 2015 Annual Report
2014.01-12
Owners’ equity attributable to parent company
Items Lessen: Other General Minority Total of owners’
Surplus equity equity
share capital Capital suplus treasury comprehensi risk Retained profits
reserve
stock ve income reserve
I. balance at the end of last year 350,014,975.00 584,861,283.21 505,533,065.25 466,608,867.000 102,089,597.39 2,009,107,787.85
1. Change of accounting policy -2,783,286.72 2,783,286.72
2. Correction of errors in previous
period
II. Balance at the beginning of this
350,014,975.00 582,077,996.49 2,783,286.72 505,533,065.25 466,608,867.00 102,089,597.39 2,009,107,787.85
year
III. Increase/ decrease of amount
210,009.80 -15,000.00 40,255,182.74 19,558,873.13 -5,458,182.31 54,550,883.36
in this year (“-” means decrease)
(I) Total comprehensive incomes -15,000.00 115,439,722.39 -920,440.66 114,504,281.73
(II) Capital increased and reduced
210,009.80 -2,281,000.00 -2,070,990.20
by owners
1. Common shares increased by
-2,281,000.00 -2,281,000.00
shareholders
2. Capital increased by holders of
other equity instruments
3. Amounts of share-based
payments recognized in owners’
equity
4. Other 210,009.80 210,009.80
(III) Profit distribution 40,255,182.74 -95,880,849.26 -2,256,741.65 -57,882,408.17
1. Withdrawing surplus public
40,225,182.74 -40,255,182.74
reserve
2. Distribution to all owners
-52,502,246.25 -2,256,741.65 -54,758,987.90
(shareholders)
3. Others -3,123,420.27 -3,123,420.27
(IV) Internal carrying forward of
owners’ equity
1. New increase of share capital
from capital reserves
2. Convert surplus reserves to
share capital
3. Surplus reserves make up
losses
4. Others
(V) Specific reserve
1. Withdrawn for the period
2. Used in the period
(VI) Other
IV. Balance at the end of this
350,014,975.00 582,288,006.29 2,768,286.72 545,788,247.99 486,167,740.13 96,631,415.08 2,063,658,671.21
period
Legal Representative: Ji Zhijian Chief Financial Official: Ma Yun Person in Charge of Accounting Organization: Mao Chunhua
131
Dalian Refrigeration Co., Ltd. 2015 Annual Report
STATEMENT OF CHANGES IN OWNERS’ EQUITY
Prepared by Dalian Refrigeration Company Limited 2015.01-12 Unit: RMB Yuan
2015.01-12
Owners’ equity attributable to parent company
Items Lessen: Other Total of
Other equity Capital Special Surplus Retained owners’ equity
share capital treasury comprehensiv
instrument suplus preparation reserve profits
stock e income
I. balance at the end of last year 350,014,975.00 582,288,006.29 1,539,359.10 545,788,247.99 391,728,575.59 1,871,359,163.97
1. Change of accounting policy
2. Correction of errors in previous
period
II. Balance at the beginning of this
350,014,975.00 582,288,006.29 1,539,359.10 545,788,247.99 391,728,575.59 1,871,359,163.97
year
III. Increase/ decrease of amount
10,150,000.00 58,476,776.74 39,503,800.00 587,219,831.33 34,981,492.17 37,018,724.13 688,343,024.37
in this year (“-” means decrease)
(I) Total comprehensive incomes 587,219,831.33 126,024,962.55 713,244,793.88
(II) Capital increased and reduced
10,150,000.00 58,476,776.74 39,503,800.00 29,122,976.74
by owners
1. Common shares increased by
10,150,000.00 46,284,000.00 39,503,800.00 16,930,200.00
shareholders
2. Capital increased by holders of
other equity instruments
3. Amounts of share-based
payments recognized in owners’ 12,190,520.00 12,190,520.00
equity
4. Other 2,256.74 2,256.74
(III) Profit distribution 34,981,492.17 -89,006,238.42 -54,024,746.25
1. Withdrawing surplus public
34,981,492.17 -34,981,492.17
reserve
2. Distribution to all owners
-54,024,746.25 -54,024,746.25
(shareholders)
3. Others
(IV) Internal carrying forward of
owners’ equity
1. New increase of share capital
from capital reserves
2. Convert surplus reserves to
share capital
3. Surplus reserves make up
losses
4. Others
(V) Specific reserve
1. Withdrawn for the period 1,982,950.50 1,982,950.50
2. Used in the period 1,982,950.50 1,982,950.50
(VI) Other
IV. Balance at the end of this
360,164,975.00 640,764,783.03 39,503,800.00 588,759,190.43 580,769,740.16 428,747,299.72 2,599,702,188.34
period
Legal Representative: Ji Zhijian Chief Financial Official: Ma Yun Person in Charge of Accounting Organization: Mao Chunhua
132
Dalian Refrigeration Co., Ltd. 2015 Annual Report
2014.01-12
Owners’ equity attributable to parent company
Items Lessen: Other Total of
Other equity Special Retained owners’ equity
share capital Capital suplus treasury comprehensiv Surplus reserve
instrument preparation profits
stock e income
I. balance at the end of last year 350,014,975.00 583,632,355.59 505,533,065.25 372,591,025.04 1,811,771,420.88
1. Change of accounting policy -1,554,359.10 1,554,359.10
2. Correction of errors in
previous period
II. Balance at the beginning of
350,014,975.00 582,077,996.49 1,554,359.10 505,533,065.25 372,591,025.04 1,811,771,420.88
this year
III. Increase/ decrease of
amount in this year (“-” means 210,009.80 -15,000.00 40,255,182.74 19,137,550.55 59,587,743.09
decrease)
(I) Total comprehensive
-15,000.00 111,894,979.54 111,879,979.54
incomes
(II) Capital increased and
210,009.80 210,009.80
reduced by owners
1. Common shares increased
by shareholders
2. Capital increased by holders
of other equity instruments
3. Amounts of share-based
payments recognized in owners’
equity
4. Other 210,009.80 210,009.80
(III) Profit distribution 40,255,182.74 -92,757,428.99 -52,502,246.25
1. Withdrawing surplus public
40,255,182.74 -40,255,182.74
reserve
2. Distribution to all owners
-52,502,246.25 -52,502,246.25
(shareholders)
3. Others
(IV) Internal carrying forward
of owners’ equity
1. New increase of share
capital from capital reserves
2. Convert surplus reserves to
share capital
3. Surplus reserves make up
losses
4. Others
(V) Specific reserve
1. Withdrawn for the period
2. Used in the period
(VI) Other
IV. Balance at the end of this
350,014,975.00 582,288,006.29 1,539,359.10 545,788,247.99 391,728,575.59 1,871,359,163.97
period
Legal Representative: Ji Zhijian Chief Financial Official: Ma Yun Person in Charge of Accounting Organization: Mao Chunhua
133
首页
微信公众号
证券之星APP
