SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
Contents Pages
The Company and consolidated balance sheets 2-3
The Company and consolidated income statements 4-5
The Company and consolidated cash flow statements 6-7
The Company and consolidated statements of changes in
shareholders' equity 8-9
Notes to the financial statements 10 - 97
-1-
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
AT 30 JUNE 2017
Consolidated Balance Sheet
Unit: RMB
LIABILITIES AND
ASSETS Notes 30 Jun. 2017 31 Dec. 2016 SHAREHOLDERS' EQUITY Notes 30 Jun. 2017 31 Dec. 2016
Current Assets: Current Liabilities:
Cash and bank balances (V)1 593,542,501.41 426,036,702.87 Short-term borrowings - -
Notes receivable (V)2 - 500,000.00 Accounts payable (V)20 98,590,197.10 89,444,597.10
Accounts receivable (V)3 243,504,003.91 173,934,496.63 Receipts in advance (V)21 129,822,174.32 30,668,212.67
Prepayments (V)4 1,804,143.70 2,639,758.53 Employee benefits payable (V)22 57,049,136.82 88,578,492.26
Interest receivable (V)5 1,264,914.26 - Taxes payable (V)23 59,511,807.19 48,504,829.80
Dividends receivable (V)6 420,000.00 - Interest payable (V)24 6,371,260.30 2,567,260.28
Other receivables (V)7 18,699,162.98 26,647,869.01 Dividends payable (V)25 319,802,810.47 -
Inventories (V)8 17,926,504.16 14,771,410.09 Other payables (V)26 75,105,519.60 74,590,394.09
Non-current liabilities due
Other current assets (V)9 19,698,853.34 16,832,212.36 - -
within one year
Total current assets 896,860,083.76 661,362,449.49 Other current liabilities (V)27 - 250,000,000.00
Non-current Assets: Total current liabilities 746,252,905.80 584,353,786.20
Available-for-sale financial assets (V)10 23,709,200.00 22,459,200.00 Non-current Liabilities:
Long-term equity investments (V)11 1,463,702,326.87 1,490,427,656.53 Bonds payable (V)28 298,629,041.09 298,331,506.85
Investment property (V)12 23,233,997.73 23,646,913.77 Special payables (V)29 33,327,666.64 34,326,860.44
Fixed assets (V)13 2,990,556,886.41 3,036,813,842.54 Deferred income (V)30 60,823,779.90 64,613,319.88
Construction in progress (V)14 183,708,222.05 164,604,358.31 Deferred tax liabilities (V)18 2,170,000.00 1,857,500.00
Intangible assets (V)15 992,031,529.45 1,010,767,451.01 Total non-current liabilities 394,950,487.63 399,129,187.17
Goodwill (V)16 10,858,898.17 10,858,898.17 TOTAL LIABILITIES 1,141,203,393.43 983,482,973.37
Long-term prepaid expenses (V)17 53,905,084.94 54,944,476.64 SHAREHOLDERS' EQUITY:
Deferred tax assets (V)18 12,172,333.47 12,221,758.47 Share capital (V)31 644,763,730.00 644,763,730.00
Other non-current assets (V)19 133,682,985.68 132,369,704.86 Capital reserve (V)32 167,480,381.25 167,480,381.25
Total non-current assets 5,887,561,464.77 5,959,114,260.30 Other comprehensive income (V)33 (7,102,146.43) (8,039,646.43)
Special reserve (V)34 8,162,628.00 4,145,765.65
Surplus reserve (V)35 520,074,434.56 520,074,434.56
Unappropriated profit (V)36 3,337,995,910.48 3,381,390,887.86
Total shareholders' equity attributable to
4,671,374,937.86 4,709,815,552.89
equity holders of the parent
Minority interests 971,843,217.24 927,178,183.53
TOTAL SHAREHOLDERS' EQUITY: 5,643,218,155.10 5,636,993,736.42
TOTAL LIABILITIES AND
TOTAL ASSETS 6,784,421,548.53 6,620,476,709.79 6,784,421,548.53 6,620,476,709.79
SHAREHOLDERS' EQUITY
The accompanying notes form part of the financial statements.
The financial statements on pages 2 to 97 were signed by the following:
Legal Representative：Liu Bin
Chief Financial Officer：Zhang Fang
Head of Accounting Department：Li Xiaopeng
-2-
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
AT 30 JUNE 2017
Balance Sheet of the Company
Unit: RMB
LIABILITIES AND
ASSETS Notes 30 Jun. 2017 31 Dec. 2016 SHAREHOLDERS' EQUITY Notes 30 Jun. 2017 31 Dec. 2016
Current Assets: Current Liabilities:
Cash and bank balances 58,389,908.02 97,401,657.09 Accounts payable 17,674,905.37 15,743,751.91
Accounts receivable (XIV)1 24,161,523.24 14,730,412.29 Receipts in advance - -
Prepayments - 175,000.00 Employee benefits payable 38,826,304.69 53,761,846.04
Interest receivable - - Taxes payable 4,995,268.84 1,906,748.15
Dividends receivable 420,000.00 134,702,787.76 Interest payable 7,052,536.22 5,657,953.71
Other receivables (XIV)2 563,789,045.88 582,452,104.00 Dividend payable 357,411,350.73 37,608,540.65
Inventories 371,317.52 394,234.74 Other payables 307,787,199.55 358,982,632.32
Other current assets 1,904,089.65 997,740.76 Other current liabilities - 250,000,000.00
Total current assets 649,035,884.31 830,853,936.64 Total current liabilities 733,747,565.40 723,661,472.78
Non-current Assets: Non-current Liabilities:
Available-for-sale financial assets 23,709,200.00 22,459,200.00 Bonds payable 298,629,041.09 298,331,506.85
Long-term receivables 11,004,284.75 11,004,284.75 Long-term payables 151,378,000.00 116,662,000.00
Long-term equity investments (XIV)3 2,012,601,688.02 2,032,600,191.97 Deferred tax liabilities 2,170,000.00 1,857,500.00
Investment property 13,358,471.82 13,600,159.92 Total non-current liabilities 452,177,041.09 416,851,006.85
Fixed assets 209,696,916.29 179,815,891.12 TOTAL LIABILITIES 1,185,924,606.49 1,140,512,479.63
Construction in progress 2,615,787.94 29,437,068.97 SHAREHOLDERS' EQUITY
Intangible assets 61,422,417.52 62,890,018.39 Share capital 644,763,730.00 644,763,730.00
Long-term prepaid expenses 4,066,779.79 4,156,590.13 Capital reserve 240,001,254.59 240,001,254.59
Total non-current assets 2,338,475,546.13 2,355,963,405.25 Other Comprehensive Income 6,610,000.00 5,672,500.00
Special reserve 1,314,835.73 1,027,543.25
Surplus reserve 520,074,434.56 520,074,434.56
Unappropriated profit 388,822,569.07 634,765,399.86
TOTAL SHAREHOLDERS'
1,801,586,823.95 2,046,304,862.26
EQUITY
TOTAL LIABILITIES AND
TOTAL ASSETS 2,987,511,430.44 3,186,817,341.89 2,987,511,430.44 3,186,817,341.89
SHAREHOLDERS' EQUITY
The accompanying notes form part of the financial statements.
-3-
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
FOR THE YEAR ENDED 30 JUNE 2017
Consolidated Income Statement
Unit: RMB
ITEM Notes Jan.-Jun. 2017 Jan.-Jun. 2016
I. Total operating income (V)37 929,608,498.91 904,809,652.24
Less: Operating costs (V)37 535,972,835.46 492,158,524.59
Business taxes and levies (V)38 5,099,769.02 3,167,942.41
Administrative expenses (V)39 72,324,731.18 81,947,868.71
Financial expenses (V)40 10,152,388.82 14,253,614.35
Impairment losses of assets (V)41 (1,908,239.31) 288,044.16
Add: Investment income (V)42 69,509,957.45 69,300,256.41
Including: Income from investments in associates
(V)42 60,092,957.45 63,008,068.56
and joint ventures
II. Operating profit 377,476,971.19 382,293,914.43
Add: Non-operating income (V)43 2,407,216.29 2,639,213.81
Including: Gains from disposal of non-current assets (V)43 293,053.57 321,539.16
Less: Non-operating expenses (V)44 742,624.36 501,465.63
Including: Losses from disposal of non-current assets (V)44 741,487.52 497,708.60
III. Gross profit 379,141,563.12 384,431,662.61
Less: Income tax expenses (V)45 58,896,433.80 49,661,006.76
IV. Net profit 320,245,129.32 334,770,655.85
Net profit attributable to shareholders of the parent 276,407,832.70 266,535,506.97
Profit or loss attributable to minority shareholders 43,837,296.62 68,235,148.88
V. Amount of Other Comprehensive Net Income After Tax: (V)46 937,500.00 (307,500.00)
Amount of other comprehensive net income after tax attributable
937,500.00 (307,500.00)
to equity holders of the parent
(I) Other comprehensive income that will not be reclassified
- -
subsequently to profit or loss
(i) Change as a result of remeasurement of the net defined
- -
benefit plan liability or asset
(ii) Share of other comprehensive income of the investee under
the equity method that will not be reclassified to profit or - -
loss
(II) Other comprehensive income that will be reclassified
937,500.00 (307,500.00)
subsequently to profit or loss
(i) Share of other comprehensive income of the investee under
- -
the equity method that will be reclassified to profit or loss
(ii) Gains or losses on changes in fair value of available-for-sale
937,500.00 (307,500.00)
financial assets
(iii) Translation differences of financial statements denominated
- -
in foreign currencies
Amount of other comprehensive net income after tax attributable
- -
to minority shareholders
VI. Total comprehensive income attributable to: 321,182,629.32 334,463,155.85
Shareholders of the parent 277,345,332.70 266,228,006.97
Minority shareholders 43,837,296.62 68,235,148.88
VII. Earnings per share:
(I) Basic earnings per share 0.429 0.413
(II) Diluted earnings per share 0.429 0.413
The accompanying notes form part of the financial statements.
-4-
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
FOR THE YEAR ENDED 30 JUNE 2017
Income Statement of the Company
Unit: RMB
ITEM Notes Jan.-Jun. 2017 Jan.-Jun. 2016
I. Total operating income (XIV)4 120,036,337.34 105,710,030.13
Less: Operating costs (XIV)4 61,993,764.64 64,949,950.84
Business taxes and levies 1,295,149.90 1,547,777.62
Administrative expenses 30,763,723.53 33,379,091.02
Financial expenses (3,567,095.64) 5,094,574.72
Impairment loss of assets (7,730.22) 1,895.24
Add: Investment income (XIV)5 43,578,170.47 49,037,666.37
Including: Income from investments in associates
(XIV)5 34,161,170.47 42,745,478.52
and joint ventures
II. Operating profit 73,136,695.60 49,774,407.06
Add: Non-operating income 551,196.35 1,631,374.22
Including: Gains from disposal of non-current assets 304,464.57 171,539.16
Less: Non-operating expenses 224,356.40 232,526.52
Including: Losses from disposal of non-current assets 223,219.56 232,526.52
III. Gross profit 73,463,535.55 51,173,254.76
Less: Income tax expenses (396,443.74) (22,956.92)
IV. Net profit 73,859,979.29 51,196,211.68
V. Amount of Other Comprehensive Net Income After Tax: 937,500.00 (307,500.00)
(I) Other comprehensive income that will not be
- -
reclassified subsequently to profit or loss
(i) Change as a result of remeasurement of the net
- -
defined benefit plan liability or asset
(ii) Share of other comprehensive income of the investee
under the equity method that will not be reclassified to - -
profit or loss
(II) Other comprehensive income that will be reclassified
937,500.00 (307,500.00)
subsequently to profit or loss
(i) Share of other comprehensive income of the investee
under the equity method that will be reclassified to - -
profit or loss
(ii) Gains or losses on changes in fair value of available-
937,500.00 (307,500.00)
for-sale financial assets
(iii) Translation differences of financial statements
- -
denominated in foreign currencies
VI. Total comprehensive income 74,797,479.29 50,888,711.68
The accompanying notes form part of the financial statements.
-5-
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
FOR THE YEAR ENDED 30 JUNE 2016
Consolidated Cash Flow Statement
Unit: RMB
ITEM Notes Jan.-Jun. 2017 Jan.-Jun. 2016
I. Cash Flows from Operating Activities:
Cash receipts from sales of goods and rendering of services 992,636,284.58 909,202,402.61
Other cash receipts relating to operating activities (V)48(1) 30,298,093.23 5,778,446.67
Sub-total of cash inflows 1,022,934,377.81 914,980,849.28
Cash payments for goods purchased and services received 309,960,731.31 257,633,025.65
Cash payments to and on behalf of employees 193,009,250.76 184,930,609.51
Payments of all types of taxes 66,501,423.23 57,624,012.99
Other cash payments relating to operating activities (V)48(2) 33,931,192.60 46,135,957.33
Sub-total of cash outflows 603,402,597.90 546,323,605.48
Net Cash Flows from Operating Activities (V)49(1) 419,531,779.91 368,657,243.80
II. Cash Flows from Investing Activities:
Cash receipts from investments income 93,324,546.74 77,197,846.38
Net cash receipts from disposal of fixed assets, intangible assets
2,650,703.87 1,916,084.08
and other long-term assets
Sub-total of cash inflows 95,975,250.61 79,113,930.46
Cash payments to acquire or construct fixed assets, intangible
88,481,440.32 62,448,676.28
assets and other long-term assets
Sub-total of cash outflows 88,481,440.32 62,448,676.28
Net Cash Flows from Investing Activities 7,493,810.29 16,665,254.18
III. Cash Flows from Financing Activities:
Cash receipts from borrowings 30,000,000.00 100,000,000.00
Cash receipts from issue of bonds - -
Sub-total of cash inflows 30,000,000.00 100,000,000.00
Cash repayments of borrowings 280,000,000.00 744,466,721.71
Cash payments for distribution of dividends or profit or interest 4,933,219.18 20,324,960.51
Including: Payments for distribution of dividends or profit to
- -
minorities
Other cash payments relating to financing activities (V)48(3) 15,792.33 25,986.89
Sub-total of cash outflows 284,949,011.51 764,817,669.11
Net Cash Flows from Financing Activities (254,949,011.51) (664,817,669.11)
IV. Effect of Foreign Exchange Rate Changes on Cash and Cash (4,570,780.15) 2,229,074.46
Equivalents
V. Net Increase (Decrease)in Cash and Cash Equivalents 167,505,798.54 (277,266,096.67)
Add: Opening balance of Cash and Cash Equivalents (V)49(2) 426,036,702.87 683,138,123.66
VI. Closing Balance of Cash and Cash Equivalents (V)49(2) 593,542,501.41 405,872,026.99
The accompanying notes form part of the financial statements.
-6-
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
FOR THE YEAR ENDED 30 JUNE 2017
Cash Flow Statement of the Company
Unit: RMB
ITEM Notes Jan.-Jun. 2017 Jan.-Jun. 2016
I. Cash Flows from Operating Activities:
Cash receipts from sales of goods and rendering of services 114,863,518.00 115,849,225.53
Other cash receipts relating to operating activities 424,203,588.78 462,768,621.77
Sub-total of cash inflows 539,067,106.78 578,617,847.30
Cash payments for goods purchased and services received 31,930,629.72 31,533,042.73
Cash payments to and on behalf of employees 61,467,607.51 63,282,140.23
Payments of all types of taxes 4,414,781.60 4,088,453.58
Other cash payments relating to operating activities 457,615,731.81 368,439,595.82
Sub-total of cash outflows 555,428,750.64 467,343,232.36
Net Cash Flows from Operating Activities (XIV)8 (16,361,643.86) 111,274,614.94
II. Cash Flows from Investing Activities:
Cash receipts from investments income 197,859,462.18 151,872,638.18
Net cash receipts from disposal of fixed assets, intangible assets
2,693,776.59 1,677,137.08
and other long-term assets
Cash receipts from disposal of subsidiaries and other business units - -
Sub-total of cash inflows 200,553,238.77 153,549,775.26
Cash payments to acquire or construct fixed assets,
3,621,231.58 2,409,879.75
intangible assets and other long-term assets
Sub-total of cash outflows 3,621,231.58 2,409,879.75
Net Cash Flows from Investing Activities 196,932,007.19 151,139,895.51
III. Cash Flows from Financing Activities:
Cash receipts from borrowings 64,715,999.99 219,658,000.00
Cash receipts from issue of bonds - -
Sub-total of cash inflows 64,715,999.99 219,658,000.00
Cash repayments of borrowings 280,000,000.00 600,000,000.00
Cash payments for distribution of dividends or profit or interest 4,933,219.18 19,798,230.88
Other cash payments relating to financing activities 15,792.33 25,986.89
Sub-total of cash outflows 284,949,011.51 619,824,217.77
Net Cash Flows from Financing Activities (220,233,011.52) (400,166,217.77)
IV. Effect of Foreign Exchange Rate Changes on Cash
650,899.12 (3,471,028.83)
and Cash Equivalents
V. Net Increase(Decrease) in Cash and Cash Equivalents (39,011,749.07) (141,222,736.15)
Add: Opening balance of Cash and Cash Equivalents 97,401,657.09 331,615,767.60
VI. Closing Balance of Cash and Cash Equivalents 58,389,908.02 190,393,031.45
The accompanying notes form part of the financial statements.
-7-
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
FOR THE YEAR ENDED 30 JUNE 2017
Consolidated Statement of Changes in Shareholders' Equity
Unit: RMB
Amount of Jan.-Jun.2017 Amount of last year
Attributable to shareholders of the parent Attributable to shareholders of the parent
Other Total Other Total
comprehensive Surplus Unappropriated Minority shareholders' comprehensive Special Unappropriated Minority shareholders'
ITEM Share capital Capital reserve income Special reserve reserve profit Others interests equity Share capital Capital reserve income reserve Surplus reserve profit Others interests equity
I. Closing balance of the preceding year 644,763,730.00 167,480,381.25 (8,039,646.43) 4,145,765.65 520,074,434.56 3,381,390,887.86 - 927,178,183.53 5,636,993,736.42 644,763,730.00 165,564,739.15 (7,889,646.43) 3,719,755.58 520,074,434.56 3,113,367,524.19 - 789,709,893.07 5,229,310,430.12
Add: Changes in accounting policies - - - - - - - - - - - - - - - - - -
Corrections of prior period errors - - - - - - - - - - - - - - - - - -
Others - - - - - - - - - - - - - - - - - -
II. Opening balance of the year 644,763,730.00 167,480,381.25 (8,039,646.43) 4,145,765.65 520,074,434.56 3,381,390,887.86 - 927,178,183.53 5,636,993,736.42 644,763,730.00 165,564,739.15 (7,889,646.43) 3,719,755.58 520,074,434.56 3,113,367,524.19 - 789,709,893.07 5,229,310,430.12
III. Changes for the year - - 937,500.00 4,016,862.35 - (43,394,977.38) - 44,665,033.71 6,224,418.68 - 1,915,642.10 (150,000.00) 426,010.07 - 268,023,363.67 - 137,468,290.46 407,683,306.30
(I) Total comprehensive income - - 937,500.00 - - 276,407,832.70 - 43,837,296.62 321,182,629.32 - - (150,000.00) - - 532,376,492.97 - 137,473,210.75 669,699,703.72
(II) Owners’ contributions and reduction in
capital
- - - - - - - - - - - - - - - - - -
1. Capital contribution from shareholders - - - - - - - - - - - - - - - - - -
2. Share-based payment recognised in
shareholders' equity
- - - - - - - - - - - - - - - - - -
3. Others - - - - - - - - - - - - - - - - - -
(III) Profit distribution - - - - - (319,802,810.08) - - (319,802,810.08) - - - - - (264,353,129.30) - - (264,353,129.30)
1. Transfer to surplus reserve - - - - - - - - - - - - - - - - - -
2. Transfer to general reserve - - - - - - - - - - - - - - - - - -
3. Distributions to shareholders - - - - - (319,802,810.08) - - (319,802,810.08) - - - - - (264,353,129.30) - - (264,353,129.30)
4. Others - - - - - - - - - - - - - - - - - -
(IV) Transfers within shareholders' equity - - - - - - - - - - - - - - - - - -
1. Capitalisation of capital reserve - - - - - - - - - - - - - - - - - -
2. Capitalisation of surplus reserve - - - - - - - - - - - - - - - - - -
3. Loss made up by surplus reserve - - - - - - - - - - - - - - - - - -
4. Others - - - - - - - - - - - - - - - - - -
(V) Special reserve - - - 4,016,862.35 - - - 827,737.09 4,844,599.44 - - - 426,010.07 - - - (4,920.29) 421,089.78
1. Withdrawn in the period - - - 9,845,498.98 - - - 1,953,624.81 11,799,123.79 - - - 19,844,261.39 - - - 3,842,861.21 23,687,122.60
2. Utilized in the period - - - (5,828,636.63) - - - (1,125,887.72) (6,954,524.35) - - - (19,418,251.32) - - - (3,847,781.50) (23,266,032.82)
(VI) Others - - - - - - - - - - 1,915,642.10 - - - - - - 1,915,642.10
IV. Closing balance of the year 644,763,730.00 167,480,381.25 (7,102,146.43) 8,162,628.00 520,074,434.56 3,337,995,910.48 - 971,843,217.24 5,643,218,155.10 644,763,730.00 167,480,381.25 (8,039,646.43) 4,145,765.65 520,074,434.56 3,381,390,887.86 - 927,178,183.53 5,636,993,736.42
The accompanying notes form part of the financial statements.
-8-
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
FOR THE YEAR ENDED 30 JUNE 2017
Statement of Changes in Shareholders' Equity of the Company
Unit: RMB
Amount of Jan.-Jun.2017 Amount of last year
Other Other
comprehensive Unappropriated Total shareholders' comprehensive Unappropriated Total shareholders'
ITEM Share capital Capital reserve income Special reserve Surplus reserve profit equity Share capital Capital reserve income Special reserve Surplus reserve profit equity
I. Closing balance of the preceding year 644,763,730.00 240,001,254.59 5,672,500.00 1,027,543.25 520,074,434.56 634,765,399.86 2,046,304,862.26 644,763,730.00 239,043,433.54 5,822,500.00 1,465,450.61 520,074,434.56 703,644,298.05 2,114,813,846.76
Add: Changes in accounting policies - - - - - - - - - - - - - -
Corrections of prior period errors - - - - - - - - - - - - - -
Others - - - - - - - - - - - - - -
II. Opening balance of the year 644,763,730.00 240,001,254.59 5,672,500.00 1,027,543.25 520,074,434.56 634,765,399.86 2,046,304,862.26 644,763,730.00 239,043,433.54 5,822,500.00 1,465,450.61 520,074,434.56 703,644,298.05 2,114,813,846.76
III. Changes for the year - - 937,500.00 287,292.48 - (245,942,830.79) (244,718,038.31) - 957,821.05 (150,000.00) (437,907.36) - (68,878,898.19) (68,508,984.50)
(I) Total comprehensive income - - 937,500.00 - - 73,859,979.29 74,797,479.29 - - (150,000.00) - - 195,474,231.11 195,324,231.11
(II) Owners’ contributions and reduction
- - - - - - - - - - - - - -
in capital
1. Capital contribution from shareholders - - - - - - - - - - - - - -
2. Share-based payment recognised in
- - - - - - - - - - - - - -
shareholders' equity
3. Others - - - - - - - - - - - - - -
(III) Profit distribution - - - - - (319,802,810.08) (319,802,810.08) - - - - - (264,353,129.30) (264,353,129.30)
1. Transfer to surplus reserve - - - - - - - - - - - - - -
2. Transfer to general reserve - - - - - - - - - - - - - -
3. Distributions to shareholders - - - - - (319,802,810.08) (319,802,810.08) - - - - - (264,353,129.30) (264,353,129.30)
4. Others - - - - - - - - - - - - - -
(IV) Transfers within shareholders' equity - - - - - - - - - - - - - -
1. Capitalisation of capital reserve - - - - - - - - - - - - - -
2. Capitalisation of surplus reserve - - - - - - - - - - - - - -
3. Loss made up by surplus reserve - - - - - - - - - - - - - -
4. Others - - - - - - - - - - - - - -
(V) Special reserve - - - 287,292.48 - - 287,292.48 - - - (437,907.36) - - (437,907.36)
1. Transfer to special reserve in the period - - - 1,119,925.68 - - 1,119,925.68 - - - 2,621,610.60 - - 2,621,610.60
2. Utilized in the period - - - (832,633.20) - - (832,633.20) - - - (3,059,517.96) - - (3,059,517.96)
(VI) Others - - - - - - - - 957,821.05 - - - - 957,821.05
IV. Closing balance of the year 644,763,730.00 240,001,254.59 6,610,000.00 1,314,835.73 520,074,434.56 388,822,569.07 1,801,586,823.95 644,763,730.00 240,001,254.59 5,672,500.00 1,027,543.25 520,074,434.56 634,765,399.86 2,046,304,862.26
The accompanying notes form part of the financial statements.
-9-
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(I) GENERAL INFORMATION OF THE COMPANY
Shenzhen Chiwan Wharf Holdings Limited (hereinafter referred to as the "Company") was a
stock limited company incorporated on 16 January 1993.
The headquarters of the Company is located in Shenzhen Guangdong Province. The Company
and its subsidiaries (collectively the "Group") are principally engaged in the provision of cargo
handling, warehousing, land and sea transportation services, cargo packing, agency business and
other services.
The scope of consolidated financial statements in the current period involves 10 subsidiaries. See
Note (VII) "Equity in other entities" for details.
(II) BASIS OF PREPARATION OF FINANCIAL STATEMENTS
Basis of preparation of financial statements
The Group has adopted the Accounting Standards for Business Enterprises issued by the Ministry
of Finance (MoF) including the new and modified ones in 2014. In addition, the Group has
disclosed relevant financial information in accordance with Information Disclosure and
Presentation Rules for Companies Offering Securities to the Public No. 15-General Provisions on
Financial Reporting (Revised in 2014).
Basis of accounting and principle of measurement
The Group has adopted the accrual basis of accounting. Except for certain financial instruments
which are measured at fair value, the Group adopts the historical cost as the principle of
measurement of the financial statements. Upon being restructured into a stock company, the fixed
assets and intangible assets initially contributed by the state-owned shareholders are recognized
based on the valuation amounts confirmed by the state-owned assets administration department.
Where assets are impaired, provisions for asset impairment are made in accordance with the
relevant requirements.
Where the historical cost is adopted as the measurement basis, assets are recorded at the amount
of cash or cash equivalents paid or the fair value of the consideration given to acquire them at the
time of their acquisition. Liabilities are recorded at the amount of proceeds or assets received or
the contractual amounts for assuming the present obligation, or, at the amounts of cash or cash
equivalents expected to be paid to settle the liabilities in the normal course of business.
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an
orderly transaction between market participants at the measurement date, regardless of whether
that price is directly observable or estimated using valuation technique. Fair value measurement
and/or disclosure in the financial statements are determined according to the above basis.
- 10 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(II) BASIS OF PREPARATION OF FINANCIAL STATEMENTS - continueed
Fair value measurements are categorised into Level 1, 2 or 3 based on the degree to which the
inputs to the fair value measurements are observable and the significance of the inputs to the fair
value measurement in its entirety, which are described as follows:
Level 1 inputs are unadjusted quoted prices in active markets for identical assets or liabilities that
the entity can access at the measurement date;
Level 2 inputs are inputs, other than quoted prices included within Level 1, that are observable for
the asset or liability, either directly or indirectly; and
Level 3 inputs are unobservable inputs for the asset or liability.
Going Concern
The Group evaluated its going concern ability within 12 months since 30 Jun. 2017. No events or
circumstances are noted, which could cause significant doubt upon the entity's ability to
continue as going concern. Hence, the financial statements have been prepared on a going concern
basis.
(III) THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES
All the following significant accounting policies and accounting estimates are based on
Accounting Standards for Business Enterprises.
1.Statement of compliance with the ASBE
The financial statements of the Company have been prepared in accordance with ASBE, and present truly and
completely, the Company's and consolidated financial position as of 30 June 2017, and the Company's and
consolidated results of operations and cash flows for six months ended 30 June 2017.
2. Accounting period
The Group has adopted the calendar year as its accounting year, e.g. from 1 January to 31
December.
.
3. Operating cycle
Buginese cycle is referred to the period from which an enterprise buys assets to manufacture to
the date it achieves cash or cash equivalents.
4. Functional currency
Renminbi ("RMB") is the currency of the primary economic environment in which the Company
and its subsidiaries operate. Therefore, the Company and its subsidiaries choose RMB as their
functional currency. The Group adopts RMB to prepare its financial statements.
- 11 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(III) THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
5. The accounting treatment of business combinations involving or not involving enterprises
under common control
Business combinations are classified into business combinations involving enterprises under
common control and business combinations not involving enterprises under common control.
5.1 Business combinations involving enterprises under common control
A business combination involving enterprises under common control is a business combination in
which all of the combining enterprises are ultimately controlled by the same party or parties both
before and after the combination, and that control is not transitory.
Assets and liabilities obtained shall be measured at their respective carrying amounts as recorded
by the combining entities at the date of the combination. The difference between the carrying
amount of the net assets obtained and the carrying amount of the consideration paid for the
combination is adjusted to the share premium in capital reserve. If the share premium is not
sufficient to absorb the difference, any excess shall be adjusted against retained earnings.
Costs that are directly attributable to the combination are charged to profit or loss in the period in
which they are incurred.
5.2 Business combinations not involving enterprises under common control and goodwill
A business combination not involving enterprises under common control is a business
combination in which all of the combining enterprises are not ultimately controlled by the same
party or parties before and after the combination.
The cost of combination is the aggregate of the fair values, at the acquisition date, of the assets
given, liabilities incurred or assumed, and equity securities issued by the acquirer, in exchange for
control of the acquire. Where a business combination not involving enterprises under common control is
achieved in stages that involve multiple transactions, the cost of combination is the sum of the consideration
paid at the acquisition date and the fair value at the acquisition date of the acquirer's previously held interest in
the acquiree. The intermediary expenses (fees in respect of auditing, legal services, valuation and
consultancy services, etc.) and other administrative expenses attributable to the business
combination are recognized in profit or loss in the periods when they are incurred.
The acquiree's identifiable assets, liabilities and contingent liabilities acquired by the acquirer in a
business combination that meet the recognition criteria shall be measured at fair value at the
acquisition date.
- 12 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(III) THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
5. The accounting treatment of business combinations involving or not involving enterprises
under common control - continued
5.2 Business combinations not involving enterprises under common control and goodwill -
continued
Where the cost of combination exceeds the acquirer's interest in the fair value of the acquiree's
identifiable net assets, the difference is treated as an asset and recognized as goodwill, which is
measured at cost on initial recognition. Where the cost of combination is less than the acquirer's
interest in the fair value of the acquiree's identifiable net assets, the acquirer reassesses the
measurement of the fair values of the acquiree's identifiable assets, liabilities and contingent
liabilities and measurement of the cost of combination. If after that reassessment, the cost of
combination is still less than the acquirer's interest in the fair value of the acquiree's identifiable
net assets, the acquirer recognizes the remaining difference immediately in profit or loss for the
current period.
Goodwill arising on a business combination is measured at cost less accumulated impairment
losses, and is presented separately in the consolidated financial statements.
6. Preparation of consolidated financial statements
The scope of consolidation in the consolidated financial statements is determined on the basis of
control. Control exists when the investor has power over the investee; is exposed, or has rights, to
variable returns from its involvement with the investee; and has the ability to use its power over
the investee to affect its returns. The Group reassesses whether or not it controls an investee if
facts and circumstances indicate that there are changes of the above elements of the definition of
control.
Consolidation of a subsidiary begins when the Group obtains control over the subsidiaries and
ceases when the Group loses control of the subsidiary.
For a subsidiary already disposed of by the Group, the operating results and cash flows before the
date of disposal (the date when control is lost) are included in the consolidated income statement
and consolidated statement of cash flows, as appropriate.
For subsidiaries acquired through a business combination involving enterprises not under
common control, the operating results and cash flows from the acquisition date (the date when
control is obtained) are included in the consolidated income statement and consolidated statement
of cash flows, as appropriate.
- 13 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(III) THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
6. Preparation of consolidated financial statements - continued
No matter when the business combination occurs in the reporting period, subsidiaries acquired
through a business combination involving enterprises under common control are included in the
Group's scope of consolidation as if they had been included in the scope of consolidation from the
date when they first came under the common control of the ultimate controlling party. Their
operating results and cash flows from the date when they first came under the common control of
the ultimate controlling party are included in the consolidated income statement and consolidated
statement of cash flows, as appropriate.
The significant accounting policies and accounting periods adopted by the subsidiaries are
determined based on the uniform accounting policies and accounting periods set out by the
Company.
All significant intra-group balances and transactions are eliminated on consolidation.
The portion of subsidiaries' equity that is not attributable to the parent is treated as minority
interests and presented as "minority interests" in the consolidated balance sheet under
shareholders' equity. The portion of net profits or losses of subsidiaries for the period attributable
to minority interests is presented as "minority interests" in the consolidated income statement
under the "net profit" line item.
When the amount of loss for the period attributable to the minority shareholders of a subsidiary
exceeds the minority shareholders' portion of the opening balance of shareholders' equity of the
subsidiary, the excess amount is still allocated against minority interests.
Acquisition of minority interests or disposals of interests in a subsidiary that do not result in the
loss of control over the subsidiary are accounted for as equity transactions. The carrying amounts
of the parent's interests and minority interests are adjusted to reflect the changes in their relative
interests in the subsidiary. The difference between the amount by which the minority interests are
adjusted and the fair value of the consideration paid or received is adjusted to shareholders' equity
(capital reserve). If the capital reserve is not sufficient to absorb the difference, the excess are
adjusted against retained earnings.
When the Group loses control over a subsidiary due to disposal of equity investment or other
reason, any retained interest is re-measured at its fair value at the date when control is lost. The
difference between (i) the aggregate of the consideration received on disposal and the fair value of
any retained interest and (ii) the share of the former subsidiary's net assets cumulatively calculated
from the acquisition date according to the original proportion of ownership interests is recognized
as investment income in the period in which control is lost, and the goodwill is offset accordingly.
Other comprehensive income associated with investment in the former subsidiary is reclassified to
investment income in the period in which control is lost.
- 14 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(III) THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
7.Types of joint arrangements and the accounting treatment of joint operation
There are two types of joint arrangements - joint operations and joint ventures. The classification
of joint arrangements under is determined based on the rights and obligations of parties to the
joint arrangements by considering the structure, the legal form of the arrangements, the
contractual terms agreed by the parties to the arrangement. A joint operation is a joint
arrangement whereby the parties that have joint control of the arrangement have rights to the
assets, and obligations for the liabilities, relating to the arrangement. A joint venture is a joint
arrangement whereby the parties that have joint control of the arrangement have rights to
the net assets of the arrangement.
Investments in joint ventures are accounted for using the equity method by the Group, which is
detailed in Note(III) 13.3.2 A long-term equity investment accounted for using the equity method.
The Group as a joint operator recognizes the following items in relation to its interest in a joint
operation: (1) its solely-held assets, including its share of any assets held jointly; (2) its solely-
assumed liabilities, including its share of any liabilities incurred jointly; (3) its revenue from the
sale of its share of the output arising from the joint operation; (4) its share of the revenue from the
sale of the output by the joint operation; and (5) its solely-incurred expenses, including its share of
any expenses incurred jointly. The Group accounts for the recognised assets, liabilities, revenues
and expenses relating to its interest in a joint operation in accordance with the requirements
applicable to the particular assets, liabilities, revenues and expenses.
8. Recognition criteria of cash and cash equivalents
Cash comprises cash on hand and deposits that can be readily withdrawn on demand. Cash
equivalents are the Group's short-term, highly liquid investments that are readily convertible to
known amounts of cash and which are subject to an insignificant risk of changes in value.
9. Foreign currency transactions
9.1 Transactions denominated in foreign currencies
A foreign currency transaction is recorded, on initial recognition, by applying the spot exchange
rate on the date of the transaction.
At the balance sheet date, foreign currency monetary items are translated into RMB using the spot
exchange rates at the balance sheet date. Exchange differences arising from the differences
between the spot exchange rates prevailing at the balance sheet date and those on initial
recognition or at the previous balance sheet date are recognized in profit or loss for the period,
except that (1) exchange differences related to a specific-purpose borrowing denominated in
foreign currency that qualify for capitalization are capitalized as part of the cost of the qualifying
asset during the capitalization period; (2) exchange differences related to hedging instruments for
the purpose of hedging against foreign currency risks are accounted for using hedge accounting;
(3) exchange differences arising from change in the carrying amounts other than the amortized
cost of available-for-sale monetary items are included in other comprehensive income.
- 15 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(III) THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
9. Foreign currency transactions- continued
9.1 Transactions denominated in foreign currencies - continued
Foreign currency non-monetary items measured at historical cost are translated to the amounts in
functional currency at the spot exchange rates on the dates of the transactions; the amounts in
functional currency remain unchanged. Foreign currency non-monetary items measured at fair
value are re-translated at the spot exchange rate on the date the fair value is determined.
Difference between the re-translated functional currency amount and the original functional
currency amount is treated as changes in fair value including changes of exchange rate and is
recognized in profit and loss or included in other comprehensive income.
10. Financial instruments
Financial assets and financial liabilities are recognized when the Group becomes a party to the
contractual provisions of the instrument. Financial assets and financial liabilities are initially
measured at fair value. For financial assets and financial liabilities at fair value through profit or
loss, transaction costs are immediately recognized in profit or loss. For other financial assets and
financial liabilities, transaction costs are included in their initial recognized amounts.
10.1 Effective interest method
The effective interest method is a method of calculating the amortized cost of a financial asset or a
financial liability (or a group of financial assets or financial liabilities) and of allocating the
interest income or interest expense over the relevant period, using the effective interest rate. The
effective interest rate is the rate that exactly discounts estimated future cash flows through the
expected life of the financial asset or financial liability or, where appropriate, a shorter period to
the net carrying amount of the financial asset or financial liability.
When calculating the effective interest rate, the Group estimates future cash flows considering all
contractual terms of the financial asset or financial liability (without considering future credit
losses), and also considers all fees paid or received between the parties to the contract giving rise
to the financial asset and financial liability that are an integral part of the effective interest rate,
transaction costs, and premiums or discounts etc.
10.2 Classification, recognition and measurement of financial assets
On initial recognition, the Group's financial assets are classified into one of the four categories,
including financial assets at fair value through profit or loss ("FVTPL"), held-to-maturity
investments, loans and receivables, and available-for-sale financial assets. All regular way
purchases or sales of financial assets are recognized and derecognized on a trade date basis.
- 16 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(III) THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
10. Financial instruments - continued
10.2 Classification, recognition and measurement of financial assets - continued
10.2.1 Financial Assets at Fair Value through Profit or Loss ("FVTPL")
Financial assets at fair value through profit or loss ("FVTPL") include financial assets held for
trading and those designated as at fair value through profit or loss.
A financial asset is classified as held for trading if one of the following conditions is satisfied: (1)
it has been acquired principally for the purpose of selling in the near term; or (2) on initial
recognition it is part of a portfolio of identified financial instruments that the Group manages
together and there is objective evidence that the Group has a recent actual pattern of short-term
profit-taking; or (3) it is a derivative that is not designated and effective as a hedging instrument,
or a financial guarantee contract, or a derivative that is linked to and must be settled by delivery
of an unquoted equity instrument (without a quoted price in an active market) whose fair value
cannot be reliably measured.
A financial asset may be designated as at FVTPL upon initial recognition only when one of the
following conditions is satisfied: (1) such designation eliminates or significantly reduces a
measurement or recognition inconsistency that would otherwise result from measuring assets or
recognizing the gains or losses on them on different bases; or (2) the financial asset forms part of
a group of financial assets or a group of financial assets and financial liabilities, which is managed
and its performance is evaluated on a fair value basis, in accordance with the Group's documented
risk management or investment strategy, and information about the grouping is reported to key
management personnel on that basis; or (3) eligible hybrid instruments that contain embedded
derivatives.
Financial assets at FVTPL are subsequently measured at fair value. Any gains or losses arising
from changes in the fair value and any dividend or interest income earned on the financial assets
are recognized in profit or loss.
10.2.2 Held-to-maturity investments
Held-to-maturity investments are non-derivative financial assets with fixed or determinable
payments and fixed maturity dates that the Group's management has the positive intention and
ability to hold to maturity.
Held-to-maturity investments are subsequently measured at amortized cost using the effective
interest method. Gain or loss arising from derecognition, impairment or amortization is
recognized in profit or loss.
- 17 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(III) THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
10. Financial instruments - continued
10.2 Classification, recognition and measurement of financial assets - continued
10.2.3 Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments
that are not quoted in an active market. Financial assets classified as loans and receivables by the
Group include notes receivable, accounts receivable, interest receivable, dividends receivable, and
other receivables.
Loans and receivables are subsequently measured at amortized cost using the effective interest
method. Gain or loss arising from derecognition, impairment or amortization is recognized in
profit or loss.
10.2.4 Available-for-sale financial assets
Available-for-sale financial assets include non-derivative financial assets that are designated on
initial recognition as available for sale, and financial assets that are not classified as financial
assets at fair value through profit or loss, loans and receivables or held-to-maturity investments.
Available-for-sale financial assets are subsequently measured at fair value, and gains or losses
arising from changes in the fair value are recognized as other comprehensive income and included
in the capital reserve, except that impairment losses and exchange differences related to amortized
cost of financial assets are recognized in profit or loss, until the financial assets are derecognized,
at which time the gains or losses are released and recognized in profit or loss.
Interests obtained and the dividends declared by the investee during the period in which the
available-for-sale financial assets are held, are recognized in investment gains.
Investments in equity instruments that do not have a quoted market price in an active market and
whose fair value cannot be reliably measured, and derivative financial assets that are linked to and
must be settled by delivery of such unquoted equity instruments are measured at cost.
10.3 Impairment of financial assets
The Group assesses at each balance sheet date the carrying amounts of financial assets other than
those at fair value through profit or loss. If there is objective evidence that a financial asset is
impaired, the Group determines the amount of any impairment loss. Objective evidence that a
financial asset is impaired is evidence that, arising from one or more events that occurred after the
initial recognition of the asset, the estimated future cash flows of the financial asset, which can be
reliably measured, have been affected.
- 18 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(III) THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
10. Financial instruments - continued
10.3 Impairment of financial assets - continued
Objective evidence that a financial asset is impaired includes the following observable events:
(1) Significant financial difficulty of the issuer or obligor;
(2) A breach of contract by the borrower, such as a default or delinquency in interest or principal
payments;
(3) The Group, for economic or legal reasons relating to the borrower's financial difficulty,
granting a concession to the borrower;
(4) It becoming probable that the borrower will enter bankruptcy or other financial
reorganizations;
(5) The disappearance of an active market for that financial asset because of financial difficulties
of the issuer;
(6) Upon an overall assessment of a group of financial assets, observable data indicates that there
is a measurable decrease in the estimated future cash flows from the group of financial assets
since the initial recognition of those assets, although the decrease cannot yet be identified
with the individual financial assets in the group. Such observable data includes:
- Adverse changes in the payment status of borrower in the group of assets;
- Economic conditions in the country or region of the borrower which may lead to a failure to
pay the group of assets;
(7) Significant adverse changes in the technological, market, economic or legal environment in
which the issuer of equity instruments operates, indicating that the cost of the investment in
the equity instrument may not be recovered by the investor;
(8) A significant or prolonged decline in the fair value of an investment in an equity instrument
below its cost;
(9) Other objective evidence indicating there is an impairment of a financial asset.
- Impairment of financial assets measured at amortized cost
If financial assets carried at cost or amortized cost are impaired, the carrying amounts of the
financial assets are reduced to the present value of estimated future cash flows (excluding future
credit losses that have not been incurred) discounted at the financial asset's original effective
interest rate. The amount of reduction is recognized as an impairment loss in profit or loss. If,
subsequent to the recognition of an impairment loss on financial assets carried at amortized cost,
there is objective evidence of a recovery in value of the financial assets which can be related
objectively to an event occurring after the impairment is recognized, the previously recognized
impairment loss is reversed. However, the reversal does not result in a carrying amount of the
financial asset that exceeds what the amortized cost would have been had the impairment not been
recognized at the date the impairment is reversed.
- 19 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(III) THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
10. Financial instruments - continued
10.3 Impairment of financial assets - continued
- Impairment of financial assets measured at amortized cost - continued
For a financial asset that is individually significant, the Group assesses the asset individually for
impairment. For a financial asset that is not individually significant, the Group assesses the asset
individually for impairment or includes the asset in a group of financial assets with similar credit
risk characteristics and collectively assesses them for impairment. If the Group determines that no
objective evidence of impairment exists for an individually assessed financial asset (whether
significant or not), it includes the asset in a group of financial assets with similar credit risk
characteristics and collectively assesses them for impairment. Assets for which an impairment
loss is individually recognized are not included in a collective assessment of impairment.
- Impairment of available-for-sale financial assets
When an available-for-sale financial asset is impaired, the cumulative loss arising from decline in
fair value previously recognized directly in other comprehensive income is reclassified from the
capital reserve to profit or loss. The amount of the cumulative loss that is reclassified from capital
reserve to profit or loss is the difference between the acquisition cost (net of any principal
repayment and amortization) and the current fair value, less any impairment loss on that financial
asset previously recognized in profit or loss.
If, subsequent to the recognition of an impairment loss on available-for-sale financial assets, there
is objective evidence of a recovery in value of the financial assets which can be related
objectively to an event occurring after the impairment is recognized, the previously recognized
impairment loss is reversed. The amount of reversal of impairment loss on available-for-sale
equity instruments is recognized as other comprehensive income and included in the capital
reserve, while the amount of reversal of impairment loss on available-for-sale debt instruments is
recognized in profit or loss.
- Impairment of financial assets measured at cost
If an impairment loss has been incurred on an investment in unquoted equity instrument (without
a quoted price in an active market) whose fair value cannot be reliably measured, or on a
derivative financial asset that is linked to and must be settled by delivery of such an unquoted
equity instrument, the carrying amount of the financial asset is reduced to the present value of
estimated future cash flows discounted at the current market rate of return for a similar financial
asset. The amount of reduction is recognized as an impairment loss in profit or loss. The
impairment loss on such financial asset is not reversed once it is recognized.
- 20 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(III) THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
10. Financial instruments - continued
10.4 Transfer of financial assets
The Group derecognizes a financial asset if one of the following conditions is satisfied: (1) the
contractual rights to the cash flows from the financial asset expire; or (2) the financial asset has
been transferred and substantially all the risks and rewards of ownership of the financial asset is
transferred to the transferee; or (3) although the financial asset has been transferred, the Group
neither transfers nor retains substantially all the risks and rewards of ownership of the financial
asset but has not retained control of the financial asset.
If the Group neither transfers nor retains substantially all the risks and rewards of ownership of a
financial asset, and it retains control of the financial asset, it recognizes the financial asset to the
extent of its continuing involvement in the transferred financial asset and recognizes an associated
liability. The extent of the Group's continuing involvement in the transferred asset is the extent to
which it is exposed to changes in the value of the transferred asset.
For a transfer of a financial asset in its entirety that satisfies the derecognition criteria, the
difference between (1) the carrying amount of the financial asset transferred; and (2) the sum of
the consideration received from the transfer and any cumulative gain or loss that has been
recognized in other comprehensive income, is recognized in profit or loss.
If a part of the transferred financial asset qualifies for derecognition, the carrying amount of the
transferred financial asset is allocated between the part that continues to be recognized and the
part that is derecognized, based on the respective fair values of those parts. The difference
between (1) the carrying amount allocated to the part derecognized; and (2) the sum of the
consideration received for the part derecognized and any cumulative gain or loss allocated to the
part derecognized which has been previously recognized in other comprehensive income, is
recognized in profit or loss
10.5 Classification, recognition and measurement of financial liabilities
Debt and equity instruments issued by the Group are classified into financial liabilities or equity
on the basis of the substance of the contractual arrangements and definitions of financial liability
and equity instrument.
On initial recognition, financial liabilities are classified into financial liabilities at fair value
through profit or loss and other financial liabilities.
- 21 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(III) THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
10. Financial instruments - continued
10.5.1 Financial liabilities at fair value through profit or loss
Financial liabilities at FVTPL consist of financial liabilities held for trading and those designated
as at FVTPL on initial recognition.
A financial liability is classified as held for trading if one of the following conditions is satisfied:
(1) It has been acquired principally for the purpose of repurchasing in the near term; or (2) On
initial recognition it is part of a portfolio of identified financial instruments that the Group
manages together and there is objective evidence that the Group has a recent actual pattern of
short-term profit-taking; or (3) It is a derivative, except for a derivative that is a designated and
effective hedging instrument, or a financial guarantee contract, or a derivative that is linked to and
must be settled by delivery of an unquoted equity instrument (without a quoted price in an active
market) whose fair value cannot be reliably measured.
A financial liability may be designated as at FVTPL upon initial recognition only when one of the
following conditions is satisfied: (1) such designation eliminates or significantly reduces a
measurement or recognition inconsistency that would otherwise result from measuring liabilities
or recognizing the gains or losses on them on different bases; or (2) the financial liability forms
part of a group of financial liabilities or a group of financial assets and financial liabilities, which
is managed and its performance is evaluated on a fair value basis, in accordance with the Group's
documented risk management or investment strategy, and information about the grouping is
reported to key management personnel on that basis; or (3) eligible hybrid instruments that
contain embedded derivatives.
Financial liabilities at FVTPL are subsequently measured at fair value, and any gains or losses
arising from changes in the fair value or any dividend or interest expense related with the
financial liabilities are recognized in profit or loss.
10.5.2 Other financial liabilities
For a derivative liability that is linked to and must be settled by delivery of an unquoted equity
instrument (without a quoted price in an active market) whose fair value cannot be reliably
measured, it is subsequently measured at cost. Other financial liabilities are subsequently
measured at amortized cost using the effective interest method, with gains or losses arising from
derecognition or amortization recognized in profit or loss.
- 22 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(III) THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
10. Financial instruments - continued
10.5 Classification and recognition of financial liabilities - continued
10.5.3 Financial guarantee contracts
A financial guarantee contract is a contract by which the guarantor and the lender agree that the
guarantor would settle the debts or bear obligations in accordance with terms of the contract in
case the borrower fails to settle the debts. Financial guarantee contracts that are not designated as
financial liabilities at fair value through profit or loss, are initially measured at their fair values
less the directly attributable transaction costs. Subsequent to initial recognition, they are measured
at the higher of: (i) the amount determined in accordance with Accounting Standard for Business
Enterprises No. 13 - Contingencies; and (ii) the amount initially recognized less cumulative
amortization recognized in accordance with the principles set out in Accounting Standard for
Business Enterprises No. 14 - Revenue.
10.6 Derecognition of Financial Liabilities
The Group derecognizes a financial liability (or part of it) when the underlying present obligation
(or part of it) is discharged. An agreement between the Group (an existing borrower) and an
existing lender to replace the original financial liability with a new financial liability with
substantially different terms is accounted for as an extinguishment of the original financial
liability and the recognition of a new financial liability.
When the Group derecognizes a financial liability or a part of it, it recognizes the difference
between the carrying amount of the financial liability (or part of the financial liability)
derecognized and the consideration paid (including any non-cash assets transferred or new
financial liabilities assumed) in profit or loss.
10.7 Offsetting financial assets and financial liabilities
Where the Group has a legal right that is currently enforceable to set off the recognized amounts,
and intends either to settle on a net basis, or to realize the financial asset and settle the financial
liability simultaneously, a financial asset and a financial liability shall be offset with the net
amount presented in the balance sheet. Except for the circumstances above, financial assets and
financial liabilities shall be presented separately in the balance sheet and shall not be offset.
10.8 Equity instruments
An equity instrument is any contract that evidences a residual interest in the assets of the Group
after deducting all of its liabilities. The issuance including refinancing, repurchase, sale or
cancellation of equity instrument of the Group is recognized as movement of shareholders' equity.
The Group does not recognize any changes in the fair value of equity instruments. Transaction
costs associated with equity transactions are deducted from shareholders' equity.
The distributions made by the Group to holders of the equity instruments are recognized as profit
distribution. Any issuance of stock dividends do not affect the shareholders' equity.
- 23 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(III) THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
11. Receivables
11.1 Receivables that are individually significant and for which bad debt provision is individually
assessed
Basis or monetary criteria for Top five balances of receivables are deemed as individually significant
determining individually significant receivables by the Group.
receivables
For receivables that are individually significant, the Group assesses the
Provision methods for receivables that receivables individually for impairment; for a financial asset that is not
are individually significant and for impaired individually, the Group includes the asset in a group of
financial assets with similar credit risk characteristics and collectively
which bad debt provision is assesses them for impairment. Receivables for which an impairment
individually assessed loss is individually recognized are not included in a collective
assessment of impairment.
11.2 Receivables for which bad debt provision is collectively assessed on a credit risk portfolio
basis
Basis for determining a portfolio
Portfolio 1 The portfolio primarily includes amounts due from related parties of
the Group, deposits and petty cash etc.
Portfolio 2 This portfolio excludes amounts due from related parties of the Group,
deposits and petty cash etc.
Bad debt provision methods for a portfolio
Portfolio 1 Specific Identification Method
Portfolio 2 Aging Analysis Method
Portfolios that use aging analysis for bad debt provision:
Provision proportion for Provision proportion for
Aging accounts receivable (%) other receivables (%)
Within 90 days (inclusive) 0 0
More than 91 days but not exceeding 183 days 0-3 0-3
More than 184 days but not exceeding year 5 5
More than 1 year but not exceeding 2 years 20 20
More than 2 years but not exceeding 3 years 50 50
More than 3 years 100 100
11.3 Accounts receivable that are not individually significant but for which individual bad debt
provision is individually assessed:
Reasons for making individual bad debt provision As objective evidence indicates the Group is unable to
collect the receivables under original terms, the
company makes individual bad debt provision.
Bad debt provision methods Under bad debt provision method, the provision is
recognized by the differences between the expected
present value of future cash flows and carrying value.
- 24 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(III) THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
12. Inventories
12.1 Categories of inventories
Inventories include spare parts, fuel, and low value consumables. Inventories are initially
measured at cost. Cost of inventories comprises all costs of purchase, costs of conversion and
other expenditures incurred in bringing the inventories to their present location and condition.
12.2 Valuation method of inventories upon delivery
The actual cost of inventories upon delivery is calculated using the weighted average method.
12.3 Basis for determining net realizable value of inventories and provision methods for decline
in value of inventories
At the balance sheet date, inventories are measured at the lower of cost and net realizable value. If
the cost of inventories is higher than the net realizable value, a provision for decline in value of
inventories is made. Net realizable value is the estimated selling price in the ordinary course of
business less the estimated costs of completion, the estimated costs necessary to make the sale and
relevant taxes. Net realizable value is determined on the basis of clear evidence obtained, after
taking into consideration the purposes of inventories being held and effect of post balance sheet
events.
Provision for decline in value of other inventories is made based on the excess of cost of
inventory over its net realizable value on an item-by-item basis.
After the provision for decline in value of inventories is made, if the circumstances that
previously caused inventories to be written down below cost no longer exist so that the net
realizable value of inventories is higher than their cost, the original provision for decline in value
is reversed and the reversal is included in profit or loss for the period.
12.4 Inventory count system
The perpetual inventory system is maintained for stock system.
12.5 Amortization methods for low cost and short-lived consumable items and packaging
materials
Packaging materials and low cost and short-lived consumable items are amortized using the
immediate write-off method.
- 25 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(III) THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
13. Long-term equity investments
13.1 Basis for determining joint control and significant influence over investee
Control is archived when the Group has the power over the investee and has rights to variable
returns from its involvement with the investee; and has the ability to use its power to affect its
returns. Joint control is the contractually agreed sharing of control over an economic activity, and
exists only when the strategic financial and operating policy decisions relating to the activity
require the unanimous consent of the parties sharing control. Significant influence is the power to
participate in the financial and operating policy decisions of the investee but is not control or joint
control over those policies. When determining whether an investing enterprise is able to exercise
control or significant influence over an investee, the effect of potential voting rights of the
investee (for example, warrants and convertible debts) held by the investing enterprises or other
parties that are currently exercisable or convertible shall be considered.
13.2 Determination of investment cost
For a long-term equity investment acquired through a business combination involving enterprises
under common control, the investment cost of the long-term equity investment is the attributable
share of the carrying amount of the shareholders' equity of the acquiree at the date of combination.
The difference between the initial investment cost and the carrying amount of cash paid, non-cash
assets transferred and liabilities assumed shall be adjusted to capital reserve. If the balance of
capital reserve is not sufficient, any excess shall be adjusted to retained earnings. If the
consideration of the combination is satisfied by the issue of equity securities, the initial
investment cost of the long-term equity investment shall be the share of party being absorbed of
the owners' equity in the consolidated financial statements of the ultimate controlling party at the
date of combination. The aggregate face value of the shares issued shall be accounted for as share
capital. The difference between the initial investment cost and the aggregate face value of the
shares issued shall be adjusted to capital reserve. If the balance of capital reserve is not sufficient,
any excess shall be adjusted to retained earnings.
For a long-term equity investment acquired through business combination not involving
enterprises under common control, the investment cost of the long-term equity investment
acquired is the cost of acquisition.
The absorbing party's or purchaser's intermediary expenses (fees in respect of auditing, legal
services, valuation and consultancy services, etc.) and other administrative expenses attributable
to the business combination are recognized in profit or loss in the periods when they are incurred.
The long-term equity investment acquired otherwise than through a business combination is
initially measured at its cost. When the entity is able to exercise significant influence or joint
control (but not control) over an investee due to additional investment, the cost of long-term
equity investments is the sum of the fair value of previously-held equity investments determined
in accordance with Accounting Standard for Business Enterprises No.22–Financial Instruments:
Recognition and Measurement of (CAS 22) and the additional investment cost.
- 26 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(III) THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
13. Long-term equity investments - continued
13.3 Subsequent measurement and recognition of profit or loss
13.3.1 A long-term equity investment accounted for using the cost method
Long-term equity investments in subsidiaries are accounted for using the cost method in the
Company's separate financial statements. A subsidiary is an investee that is controlled by the
Group.
Under the cost method, a long-term equity investment is measured at initial investment cost.
Additional or withdrawing investment would affect the cost of long-term equity investment.
Investment income is recognized in the period in accordance with the attributable share of cash
dividends or profit distributions declared by the investee.
13.3.2 A long-term equity investment accounted for using the equity method
The Group accounts for investment in associates and joint ventures using the equity method. An
associate is an entity over which the Group has significant influence and a joint venture is a joint
arrangement whereby the parties that have joint control of the arrangement have rights to the net
assets of the joint arrangement.
Under the equity method, where the initial investment cost of a long-term equity investment
exceeds the Group's share of the fair value of the investee's identifiable net assets at the time of
acquisition, no adjustment is made to the initial investment cost. Where the initial investment cost
is less than the Group's share of the fair value of the investee's identifiable net assets at the time of
acquisition, the difference is recognized in profit or loss for the period, and the cost of the long-
term equity investment is adjusted accordingly.
Under the equity method, the Group recognizes its share of the other comprehensive income and
net profit or loss of the investee for the period as other comprehensive income and investment
income or loss respectively for the period, and the carrying amount of the long-term equity
investment is adjusted accordingly. The carrying amount of the investment shall be reduced by the
portion of any profit distributions or cash dividends declared by the investee that is distributed to
the investing enterprise. The investing enterprise shall adjust the carrying amount of the
long-term equity investment for other changes in owners' equity of the investee (other
than net profits or losses, other comprehensive income and profit distribution), and include the
corresponding adjustment in capital reserve. The Group recognizes its share of the investee's net
profit or loss based on the fair value of the investee's individually identifiable assets at the
acquisition date after making appropriate adjustments. Where the accounting policies and
accounting period adopted by the investee are different from those of the investing enterprise, the
investing enterprise shall adjust the financial statements of the investee to conform to its own
accounting policies and accounting period, and recognise other comprehensive income and
investment income or losses based on the adjusted financial statements. Unrealized profits or
losses resulting from the Group's transactions and assets invested or sold that are not recognized
as business transactions with its associates and joint ventures are recognized as investment income
or loss to the extent that those attributable to the Group's, equity interest are eliminated. However,
unrealized losses resulting from the Group's transactions with its associates and joint ventures
which represent impairment losses on the transferred assets are not eliminated.
- 27 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(III) THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
13. Long-term equity investments - continued
13.3 Subsequent measurement and recognition of profit or loss - continued
13.3.2 A long-term equity investment accounted for using the equity method - continued
The Group discontinues recognizing its share of net losses of the investee after the carrying
amount of the long-term equity investment together with any long-term interests that in substance
form part of its net investment in the investee are reduced to zero. Except that if the Group has
incurred obligations to assume additional losses, a provision is recognized according to the
obligation expected, and recorded in the investment loss for the period. Where net profits are
subsequently made by the investee, the Group resumes recognizing its share of those profits only
after its share of the profits exceeds the share of losses previously not recognized.
13.4 Disposal of long-term equity investments
On disposal of a long-term equity investment, the difference between the proceeds actually
received and receivable and the carrying amount is recognized in profit or loss for the period.
For long-term equity investments accounted for using the equity method, if the remaining interest
after disposal is still accounted for using the equity method, other comprehensive income
previously recognised for using the equity method is accounted for on the same basis as would
have been required if the investee had directly disposed of related assets or liabilities, and
transferred to profit or loss for the period on a pro rata basis; owners' equity recognised due to
changes in other owners' equity of the investee (other than net profit or loss, other comprehensive
income and profit distribution) is transferred to profit or loss for the period on a pro rata basis.
For long-term equity investments accounted for using the cost method, if the remaining interest
after disposal is still accounted for using the cost method, other comprehensive income previously
recognised for using the equity method or in accordance with the standards for the recognition and
measurement of financial instruments before obtaining the control over the investee, is accounted
for on the same basis as would have been required if the investee had directly disposed of related
assets or liabilities, and transferred to profit or loss for the period on a pro rata basis; changes in
other owners' equity in the investee's net assets recognised under the equity method (other than
net profit or loss, other comprehensive income and profit distribution) is transferred to profit or
loss for the period on a pro rata basis.
14. Investment properties
Investment property is property held to earn rentals or for capital appreciation or both. It includes
a land use right that is leased out; a land use right held for transfer upon capital appreciation; and
a building that is leased out.
An investment property is measured initially at cost. Subsequent expenditures incurred for such
investment property are included in the cost of the investment property if it is probable that
economic benefits associated with an investment property will flow to the Group and the
subsequent expenditures can be measured reliably, other subsequent expenditures are recognized
in profit or loss in the period in which they are incurred.
- 28 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(III) THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
14. Investment properties - continued
The Group uses the cost model for subsequent measurement of investment property, and adopts a
depreciation or amortization policy for the investment property which is consistent with that for
buildings or land use rights.
When an investment property is sold, transferred, retired or damaged, the Group recognizes the
amount of any proceeds on disposal net of the carrying amount and related taxes in profit or loss
for the period.
15. Fixed assets
15.1 Recognition criteria for fixed assets
Fixed assets are tangible assets that are held for use in the production or supply of goods or
services, for rental to others, or for administrative purposes, and have useful lives of more than
one accounting year. A fixed asset is recognized only when it is probable that economic benefits
associated with the asset will flow to the Group and the cost of the asset can be measured reliably.
Fixed assets are initially measured at cost. Upon being restructured into a stock company, the
fixed assets initially contributed by the state-owned shareholders are recognized based on the
valuation amounts confirmed by the state-owned assets administration department.
Subsequent expenditures incurred for the fixed asset are included in the cost of the fixed asset and
if it is probable that economic benefits associated with the asset will flow to the Group and the
subsequent expenditures can be measured reliably. Meanwhile the carrying amount of the
replaced part is derecognized. Other subsequent expenditures are recognized in profit or loss in
the period in which they are incurred.
15.2 Depreciation of each category of fixed assets
A fixed asset is depreciated over its useful life using the straight-line method starting from the
month subsequent to the one in which it is ready for intended use. The useful life, estimated net
residual value rate and annual depreciation rate of each category of fixed assets are as follows:
Estimated Estimated Annual
Category useful lives residual value depreciation rate
Port and terminal facilities 5 - 50 years 10% 1.8%-18%
Container yards and buildings 5 - 40 years 10% 2.25%-18%
Mechanical equipment 5 - 15 years 10% 6%-18%
Motor vehicles, cargo ships and tugboats 5 - 20 years 10% 4.5%-18%
Other equipment 5 years 10% 18%
Estimated net residual value of a fixed asset is the estimated amount that the Group would
currently obtain from disposal of the asset, after deducting the estimated costs of disposal, if the
asset were already of the age and in the condition expected at the end of its useful life.
- 29 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(III) THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
15. Fixed assets - continued
15.3 Other explanations
If a fixed asset is upon disposal or no future economic benefits are expected to be generated from
its use or disposal, the fixed asset is derecognized. When a fixed asset is sold, transferred, retired
or damaged, the amount of any proceeds on disposal of the asset net of the carrying amount and
related taxes is recognized in profit or loss for the period.
The Group reviews the useful life and estimated net residual value of a fixed asset and the
depreciation method applied at least once at each financial year-end, and account for any change
as a change in an accounting estimate.
16. Construction in progress
Construction in progress is measured at its actual costs. The actual costs include various
construction expenditures during the construction period, borrowing costs capitalized before it is
ready for intended use and other relevant costs. Construction in progress is not depreciated.
Construction in progress is transferred to a fixed asset when it is ready for intended use.
17. Borrowing Costs
Borrowing costs directly attributable to the acquisition, construction or production of qualifying
asset are capitalized when expenditures for such asset and borrowing costs are incurred and
activities relating to the acquisition, construction or production of the asset that are necessary to
prepare the asset for its intended use or sale have commenced. Capitalization of borrowing costs
ceases when the qualifying asset being acquired, constructed or produced becomes ready for its
intended use or sale. Capitalization of borrowing costs is suspended during periods in which the
acquisition, construction or production of a qualifying asset is interrupted abnormally and when
the interruption is for a continuous period of more than 3 months. Capitalization is suspended
until the acquisition, construction or production of the asset is resumed. Other borrowing costs are
recognized as an expense in the period in which they are incurred.
Where funds are borrowed under a specific-purpose borrowing, the amount of interest to be
capitalized is the actual interest expense incurred on that borrowing for the period less any bank
interest earned from depositing the borrowed funds before being used on the asset or any
investment income on the temporary investment of those funds. Where funds are borrowed under
general-purpose borrowings, the Group determines the amount of interest to be capitalized on
such borrowings by applying a capitalization rate to the weighted average of the excess of
cumulative expenditures on the asset over the amounts of specific-purpose borrowings. The
capitalization rate is the weighted average of the interest rates applicable to the general-purpose
borrowings.
- 30 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(III) THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
17. Borrowing Costs - continued
During the capitalization period, exchange differences related to a specific-purpose borrowing
denominated in foreign currency are all capitalized. Exchange differences in connection with
general-purpose borrowings are recognized in profit or loss in the period in which they are
incurred.
18. Intangible assets
Intangible assets include land use rights, sea area use rights and computer software.
An intangible asset is measured initially at cost. Upon being restructured into a stock company,
the intangible assets initial contributed by the state-owned shareholders are recognized based on
the valuation amounts confirmed by the state-owned assets administration department. When an
intangible asset with a finite useful life is available for use, its original cost is amortized over its
estimated useful life.
Residual
Category Amortization method Estimated useful lives(year) value (%)
Land use rights Straight-line method 20-50 -
Computer software Straight-line method 5 -
Sea area use rights Straight-line method 5-50 -
Coastal line use rights Straight-line method 41.9-44.3 -
For an intangible asset with a finite useful life, the Group reviews the useful life and amortization
method at the end of the period, and makes adjustments when necessary.
19. Impairment of long-term assets
The Group assesses at the balance sheet date whether there is any indication that the long-term
equity investments, investment properties measured at cost method, construction in progress,
fixed assets and intangible assets with a finite useful life may be impaired. If there is any
indication that such assets may be impaired, recoverable amounts are estimated for such assets.
Intangible assets with indefinite useful life and intangible assets not yet available for use are
tested for impairment annually, irrespective of whether there is any indication that the assets may
be impaired.
Recoverable amount is estimated on individual basis. If it is not practical to estimate the
recoverable amount of an individual asset, the recoverable amount of the asset group to which the
asset belongs will be estimated. The recoverable amount of an asset is the higher of its fair value
less costs of disposal and the present value of the future cash flows expected to be derived from
the asset.
If the recoverable amount of an asset or an asset group is less than its carrying amount, the deficit
is accounted for as an impairment loss and is recognized in profit or loss.
- 31 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(III) THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
19. Impairment of long-term assets - continued
Goodwill is tested for impairment at least at the end of each year. For the purpose of impairment
testing, goodwill is considered together with the related assets groups, i.e., goodwill is reasonably
allocated to the related assets groups or each of assets groups expected to benefit from the
synergies of the combination. In testing an assets group with goodwill for impairment, an
impairment loss is recognized if the recoverable amount of the assets group or sets of assets
groups (including goodwill) is less than its carrying amount. The impairment loss is firstly
allocated to reduce the carrying amount of any goodwill allocated to such assets group or sets of
assets groups, and then to the other assets of the group pro-rata basis on the basis of the carrying
amount of each asset (other than goodwill) in the group.
Once the impairment loss of above-mentioned asset is recognized, it shall not be reversed in any
subsequent period.
20. Long-term prepaid expenses
Long-term prepaid expenses represent expenses incurred that should be borne and amortized over
the current and subsequent periods (together of more than one year). Long-term prepaid expenses
are amortized using the straight-line method over the expected periods in which benefits are
derived.
21. Employee benefits
21.1 The accounting treatment of short-term employee benefits
Actually occurred short-term employee benefits are recognised as liabilities, with a corresponding
charge to the profit or loss for the period or in the costs of relevant assets in the accounting period
in which employees provide services to the Group. Staff welfare expenses incurred by the Group
are recognised in profit or loss for the period or the costs of relevant assets based on the actually
occurred amounts when it actually occurred. Non-monetary staff welfare expenses are measured
at fair value.
Payment made by the Group of social security contributions for employees such as premiums or
contributions on medical insurance, work injury insurance and maternity insurance, etc. and
payments of housing funds, as well as union running costs and employee education costs provided
in accordance with relevant requirements, are calculated according to prescribed bases and
percentages in determining the amount of employee benefits and recognised as relevant liabilities,
with a corresponding charge to the profit or loss for the period or the costs of relevant assets in the
accounting period in which employees provide services.
- 32 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(III) THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
21、Employee benefits - continued
21.2 The accounting treatment of post-employment benefits
All the post-employment benefits are defined contribution plans.
The contribution payable to the defined contribution plan is recognised as liabilities, with a
corresponding charge to the profit or loss for the period or in the costs of relevant assets in the
accounting period in which employees provide services to the Group.
21.3 The accounting treatment of termination benefits
When the Group provides termination benefits to employees, employee benefit liabilities are
recognised for termination benefits, with a corresponding charge to the profit or loss for the
period at the earlier of: (1) when the Group cannot unilaterally withdraw the offer of termination
benefits because of the termination plan or a curtailment proposal; and (2) when the Group
recognizes costs or expenses related to restructuring that involves the payment of termination
benefits.
22. Provisions
Provisions are recognised when the Group has a present obligation related with contingencies, it is
probable that the Group will be required to settle that obligation causing an outflow of economic
benefits, and a reliable estimate can be made of the amount of the obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle
the present obligation at balance sheet date, taking into account the risks, uncertainties and time
value of money surrounding the obligation. When a provision is measured using the cash flows
estimated to settle the present obligation, its carrying amount is the present value of those cash
flows where the effect of the time value of money is material.
When some or all of the economic benefits required to settle a provision are expected to be
recovered from a third party, a receivable is recognised as an asset if it is virtually certain that
reimbursement will be received and the amount of the receivable should not exceed the carrying
amount of provisions.
23. Revenue
23.1 Revenue from rendering of services
The Group provides load and unload services, tugboat and trailer services, logistics agency and
other related harbor services to customers. Revenue from rendering of services is recognized
when (1) the amount of revenue can be measured reliably; (2) it is probable that the associated
economic benefits will flow to the enterprise; and (3) the associated costs incurred or to be
incurred can be measured reliably.
- 33 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(III) THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
23. Revenue - continued
23.2 Rental income - continued
The operating lease income of investment property should be recognized in the lease term at the
price stated in contract or agreements using the straight-line method.
23.3 Interest income
Interest income is calculated based on the length of time for which the Group's cash is used by
others and the applicable interest rate.
24. Government grants
Government grants are transfer of monetary assets or non-monetary assets from the government to
the Group at no consideration. A government grant measured at a nominal amount is recognized
immediately in profit or loss for the period.
A government grant is recognized only when the Group can comply with the conditions attached
to the grant and the Group will receive the grant. If a government grant is in the form of a transfer
of a monetary asset, it is measured at the amount received or receivable.
24.1 The accounting treatment of government grants related to assets
A government grant, such as special funds for modern logistics project and special funds for
energy-saving and emission reduction of transportation, related to an asset is recognized as
deferred income, and evenly amortized to profit or loss over the useful life of the related asset.
24.2 The accounting treatment of government grants related to income
A government grant relating to income, if used to compensate the related expenses or losses to be
incurred in subsequent periods, such as financial support funds of business tax converted to VAT
and reward for energy saving, is determined as deferred income and recognised in profit or loss
over the periods in which the related costs are recognized; if used to compensate the related
expenses or losses already incurred, is recognised immediately in profit or loss for the period.
25. Deferred tax assets/ deferred tax liabilities
The income tax expenses include current income tax and deferred income tax.
25.1 Current income tax
At the balance sheet date, current income tax liabilities (or assets) for the current and prior periods
are measured at the amount expected to be paid (or recovered) according to the requirements of
tax laws.
- 34 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(III) THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
25. Deferred tax assets/ deferred tax liabilities - continued
25.2 Deferred tax assets and deferred tax liabilities
For temporary differences between the carrying amounts of certain assets or liabilities and their
tax base, or between the nil carrying amount of those items that are not recognized as assets or
liabilities and their tax base that can be determined according to tax laws, deferred tax assets and
liabilities are recognized using the balance sheet liability method.
Deferred tax liabilities are generally recognized for all taxable temporary differences. Deferred
tax assets for deductible temporary differences are recognized to the extent that it is probable that
taxable profits will be available against which the deductible temporary differences can be utilized.
However, for temporary differences associated with the initial recognition of goodwill and the
initial recognition of an asset or liability arising from a transaction (not a business combination)
that affects neither the accounting profit nor taxable profits (or deductible losses) at the time of
transaction, no deferred tax asset or liability is recognized.
For deductible losses and tax credits that can be carried forward, deferred tax assets are
recognized to the extent that it is probable that future taxable profits will be available against
which the deductible losses and tax credits can be utilized.
Deferred tax liabilities are recognized for taxable temporary differences associated with
investments in subsidiaries and associates, and interests in joint ventures, except where the Group
is able to control the timing of the reversal of the temporary difference and it is probable that the
temporary difference will not reverse in the foreseeable future. Deferred tax assets arising from
deductible temporary differences associated with such investments and interests are only
recognized to the extent that it is probable that there will be taxable profits against which to utilize
the benefits of the temporary differences and they are expected to reverse in the foreseeable future.
At the balance sheet date, deferred tax assets and liabilities are measured at the tax rates
applicable in the period in which the asset is realized or the liability is settled according to tax
laws.
Current and deferred tax expenses or income are recognized in profit or loss for the period, except
when they arise from transactions or events that are directly recognized in other comprehensive
income or in equity, in which case they are recognized in other comprehensive income or in
equity, and when they arise from business combinations, in which case they adjust the carrying
amount of goodwill.
At the balance sheet date, the carrying amount of deferred tax assets is reviewed and reduced if it
is no longer probable that sufficient taxable profits will be available in the future to allow the
benefit of deferred tax assets to be utilized. Any such reduction in amount is reversed when it
becomes probable that sufficient taxable profits will be available.
- 35 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(III) THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
25. Deferred tax assets/ deferred tax liabilities - continued
25.3 Offset of income tax
When the Group has a legal right to settle on a net basis and intends either to settle on a net basis
or to realize the assets and settle the liabilities simultaneously, current tax assets and current tax
liabilities are offset and presented on a net basis.
When the Group has a legal right to settle current tax assets and liabilities on a net basis, and
deferred tax assets and deferred tax liabilities relate to income taxes levied by the same taxation
authority on either the same taxable entity or different taxable entities which intend either to settle
current tax assets and liabilities on a net basis or to realize the assets and liabilities simultaneously,
in each future period in which significant amounts of deferred tax assets or liabilities are expected
to be reversed, deferred tax assets and deferred tax liabilities are offset and presented on a net
basis.
26. Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the
risks and rewards of ownership to the lessee. All other leases are classified as operating leases.
26.1 The accounting treatment of operating leases
26.1.1 The Group as lessee under operating leases
Operating lease payments are recognized on a straight-line basis over the term of the relevant
lease, and are either included in the cost of related asset or charged to profit or loss for the period.
Initial direct costs incurred are charged to profit or loss for the period. Contingent rents are
charged to profit or loss in the period in which they are actually incurred.
26.1.2 The Group as lessor under operating leases
Rental income from operating leases is recognized in profit or loss on a straight-line basis over the
term of the relevant lease. Initial direct costs with more than an insignificant amount are
capitalized when incurred, and are recognized in profit or loss on the same basis as rental income
over the lease term. Other initial direct costs with an insignificant amount are charged in profit or
loss in the period in which they are incurred. Contingent rents are charged to profit or loss in the
period in which they actually arise.
- 36 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(III) THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
27. Safety Production Cost
According to the Administrative Rules on Provision and Use of Enterprise Safety Production Cost
jointly issued by the Ministry of Finance and the State Administration of Work Safety on 14
February 2012 (filed as Cai Qi [2012] No. 16), safety production cost set aside by the Group is
directly included in the cost of relevant products or recognized in profit or loss for the period, as
well as the special reserve. When safety production cost set aside is utilized, if the costs incurred
can be categorized as expenditure, the costs incurred should be charged against the special reserve.
If the costs set aside are used to build up fixed assets, the costs should be charged to construction
in progress, and reclassified to fixed assets when the safety projects are ready for intended use.
Meantime, expenditures in building up fixed assets are directly charged against the special reserve
with the accumulated depreciation recognized at the same amount. Depreciation will not be made
in the future period on such fixed assets.
28. Critical judgments in applying accounting policies and key assumptions and
uncertainties in accounting estimates
In the application of accounting policies as set out in Note (III), the Company is required to make
judgments, estimates and assumptions about the carrying amounts of items in the financial
statements that cannot be measured accurately, due to the internal uncertainty of the operating
activities. These judgments, estimates and assumptions are based on historical experiences of the
Company's management as well as other factors that are considered to be relevant. Actual results
may differ from these estimates.
The Company regularly reviews the judgments, estimates and assumptions on a going concern
basis. Changes in accounting estimates which only affect the current period should be recognized
in current period; changes which not only affect the current but the future periods should be
recognized in current and future periods. At the balance sheet date, key assumptions and
uncertainties that are likely to lead to significant adjustments to the book values of assets and
liabilities in the future are:
Goodwill impairment
For the purpose of impairment testing, the present value of the expected future cash flows of the
assets group or portfolio including goodwill shall be calculated, and such expected future cash
flows shall be estimated. Meantime, a pre-tax rate shall be determined that should reflect the time
value of money on the current market and the specific asset risks.
- 37 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(III) THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
28. Critical judgments in applying accounting policies and key assumptions and
uncertainties in accounting estimates - continued
Recognition of deferred tax
The Group calculates and makes provision for deferred income tax liabilities according to the
profit distribution plan of subsidiaries, associates and the joint ventures subject to the related law.
For retained earnings which are not allocated by the investment company, since the profits will be
used to invest the company's daily operation and future development, no deferred income tax
liabilities are recognized. If the actually distributed profits in the future are more or less than those
expected, corresponding deferred tax liabilities will be recognized or reversed at the earlier of
profits distribution date and the declaration date, in the profit and loss of the current period.
Deferred tax assets are recognized based on the deductible temporary difference and the
corresponding tax rate, to the extent that it has become probable that future taxable profit will be
available for the deductible temporary difference. If in the future the actual taxable income does
not coincide with the amount currently expected, the deferred tax assets resulting will be
recognized or reversed in the period when actually incurred, in profit or loss.
(IV) TAXES
1. Major taxes and tax rates
Taxes Tax basis Tax rate
Enterprise income tax Taxable income 25%
Load and unload income, tugboat income, trailer income,
6%
warehousing income and agency income
Taxable income from vehicle maintenance and utilities supplies
13% and17%
on ships in shore
Value-add Tax
Taxable income from sales of scraps and rental income from
3%
tangible property
Taxable income from leases of immovable property and labor 5% and 6%
dispatching (Note 2)
Urban maintenance and 5% and 7 %
VAT
construction tax (Note 1)
Education surcharges VAT 3%
Regional education surcharges VAT 2%
Entities using different enterprise income tax rate:
Name of entity Enterprise income tax rate
Chiwan Wharf Holdings (HK) Limited 16.50%
Chiwan Shipping (HK) Company Limited 16.50%
Xuanyun Development Company Limited 16.50%
- 38 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(IV) TAXES - continued
1. Major taxes and tax rates - continued
Note 1: The subsidiaries set up in Shenzhen are subject to an city maintenance and construction
tax rate of 7%, and those set up in Dongguan are subject to an city maintenance and
construction tax rate of 5%.
Note 2: Pursuant to the Notice of the Ministry of Finance and the State Administration of Taxation
("SAT")on Full Launch of the Pilot Scheme on Levying Value-added Tax in Place of
Business Tax (filed as Cai Shui [2016] No. 36), a full implementation of replacing
business tax with VAT has been launched. Therefore, the Group is subject to VAT at 5%
and 6% respectively for rental income from immovable property and income from labor
dispatching since 1 May 2016.
Pursuant to the Interim Measures on Management of VAT Collection on Immovable
Property Leases Provided by Taxpayers released by SAT(filed as the notice of SAT 2016
No.16), the Group, are entitled to VAT tax rate at 5% based on simple tax method for
immovable property leasing since 1 May 2016.
2. Tax preference
On 8 July 2014, Machong Branch of National Taxation Bureau in Dongguan City approved that
Dongguan Chiwan Terminal Co., Ltd ("DGT"), a subsidiary of the Group, was subject to tax
preference of "3-year exemption followed by 3-year half reduction" commencing from 2014.
DGT is exempted from income tax in 2016 (2016: exempted from enterprise income tax).
According to Doc. [2013] No.3 issued by Shekou Local Taxation Bureau In Shenzhen, the profits
derived from berth 13A# of Shenzhen Chiwan Harbour Container Co., Ltd ("CHCC"), was
subject to tax preference of "3-year exemption followed by 3-year half reduction" commencing
from 2012. 2016 is the fifth profit-making year of berth 13A#, hence, the tax rate of 12.5% was
adopted to calculate its enterprise income tax. (2016: 12.5%).
According to the joint verification by Science and Technology Innovation Commission of
Shenzhen Municipality, Finance Commission of Shenzhen Municipality, Shenzhen Provincial
Office, SAT and Shenzhen Local Taxation Bureau, Chiwan Container Terminal Co., Ltd ("CCT"),
a subsidiary of the Group, is a high-tech enterprise, and was subject to tax preference of 3-year
enterprise income tax rate of 15% commencing from 2014. The high-tech certificate of Chiwan
Container Terminal Co., Ltd., a subsidiary of the Company, expired at the end of 2016 and the
subsidiary was going through a review for that certificate in the first half of 2017. Therefore, out
of the principle of prudence, the income tax rate for the subsidiary was reported at 25% for this
year.
According to the Notice on Taxable Services Subject to "VAT" Tax Rate of Zero and Exemption
issued by the Ministry of Finance and State Administration of Taxation (filed as Cai Shui [2011]
No.131), and approvals released by Shekou National Taxation Bureau in Shenzhen (filed as Shen
Guo Shui She Jian Mian Bei [2015] No.0419, [2015] No.0575 and [2015] No.0755 respectively),
CCT, CHCC and Shenzhen Chiwan International Freight Agency Co., Ltd, the subsidiaries of the
Group, are exempted from VAT when providing logistics support service to overseas enterprises
except for warehousing service.
- 39 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS
1. Cash and bank balances
Unit: RMB
Item Closing balance Opening balance
Cash:
RMB 1,282.79 20,664.46
USD 480.98 492.53
HKD 7,555.68 7,786.85
Subtotal 9,319.45 28,943.84
Bank deposit:
RMB 316,148,677.71 225,166,179.45
USD 243,709,449.24 175,236,570.78
HKD 19,714,770.66 25,531,313.32
Subtotal 579,572,897.61 425,934,063.55
Other cash and bank balances (Note)
RMB 13,960,284.35 73,695.48
USD - -
HKD - -
Subtotal 13,960,284.35 73,695.48
Total 593,542,501.41 426,036,702.87
Including: The total amount of funds deposited in overseas 6,573,964.58 11,778,425.97
Note: The balance of other cash and bank balances is mainly the amount deposited in the
securities settlement account of China Merchants Securities Co., Ltd and bank guarantee deposit
of DGT.
2. Notes receivable
Unit: RMB
Category Closing balance Opening balance
Bank acceptance bills - 500,000.00
Note: No notes receivable pledged, endorsed or discounted at the year end.
3. Accounts receivable
(1) Disclosure of accounts receivable by categories
Unit: RMB
Closing balance Opening balance
Carrying amount Bad debt provision Carrying amount Bad debt provision
Proporti Proporti Proportio Proporti
Item Amount on (%) Amount on (%) Book value Amount n (%) Amount on (%) Book value
Accounts receivable that are individually
significant and for which bad debt provision has - - - - - - - - - -
been assessed individually
Accounts receivable for which bad debt provision has been assessed by credit risk portfolios
Portfolio 1 8,629,958.62 3.50 - - 8,629,958.62 4,527,585.51 2.54 - - 4,527,585.51
Portfolio 2 235,090,646.20 95.38 216,600.91 0.09 234,874,045.29 169,922,044.73 95.41 515,133.61 0.30 169,406,911.12
Subtotal of portfolios 243,720,604.82 98.88 216,600.91 0.09 243,504,003.91 174,449,630.24 97.95 515,133.61 0.30 173,934,496.63
Accounts receivable that are not individually
significant but for which bad debt provision has 2,768,544.64 1.12 2,768,544.64 100.00 - 3,647,046.03 2.05 3,647,046.03 100.00 -
been assessed individually
Total 246,489,149.46 100.00 2,985,145.55 1.21 243,504,003.91 178,096,676.27 100.00 4,162,179.64 2.34 173,934,496.63
- 40 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
3. Accounts receivable - continued
(1) Disclosure of accounts receivable by categories - continued
Accounts receivable portfolios for which bad debt provision has been assessed using the
aging analysis approach:
Unit: RMB
Closing balance Opening balance
Carrying Bad debt Proportion Carrying Bad debt Proportion
Aging amount provision (%) Book value amount provision (%) Book value
Within 1 year 234,715,478.17 125,525.47 0.05 234,589,952.70 169,810,253.50 477,141.52 0.28 169,333,111.98
More than 1 year but not
354,390.73 70,878.14 20.00 283,512.59 91,873.93 18,374.79 20.00 73,499.14
exceeding 2 years
More than 2 years but not
1,160.00 580.00 50.00 580.00 600.00 300.00 50.00 300.00
exceeding 3 years
More than 3 years 19,617.30 19,617.30 100.00 - 19,317.30 19,317.30 100.00 -
Total 235,090,646.20 216,600.91 0.09 234,874,045.29 169,922,044.73 515,133.61 0.30 169,406,911.12
(2) Bad debt provision, reversal and written-off
Unit: RMB
bad debt Decrease
Item Opening balance provision Reversal Write-off Closing balance
Accounts receivable 4,162,179.64 456,427.17 1,633,461.26 - 2,985,145.55
(3) There are no accounts receivables that have been written off during the year.
(4) Top five balances of accounts receivable classified by debtor:
Unit: RMB
Proportion of the
amount to the
Relationship with total accounts
Name of customer the Company Amount receivable (%) Bad debt provision
Customer A Customer 54,209,574.08 21.99 1,443.60
Customer B Customer 33,974,868.00 13.78 -
Customer C Customer 14,546,864.86 5.90 -
Customer D Customer 9,432,338.45 3.83 -
Customer E Customer 7,905,330.53 3.21 -
Total 120,068,975.92 48.71 1,443.60
4. Prepayments
(1) Prepayments presented by aging
Unit: RMB
Closing balance Opening balance
Aging Amount Proportion (%) Amount Proportion (%)
Within 1 year 1,804,143.70 100.00 2,464,758.53 93.37
More than 1 year
- - - -
but not exceeding 2 years
More than 2 years but not
- - 175,000.00 6.63
exceeding 3 years
Total 1,804,143.70 100.00 2,639,758.53 100.00
- 41 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
4. Prepayments - continued
(2) Top five balances of prepayments classified by entities
Unit: RMB
Proportion of the
closing balance to
Relationship with Closing the total
Entities the Company balance prepayments (%)
The People's Property Insurance Company (Group) of
Supplier 680,511.80 37.72
China Limited, Shenzhen Branch
China Life Insurance Co., Ltd Shenzhen Branch Supplier 555,913.81 30.82
Kingdee software (China) Co., Ltd. Supplier 252,391.51 13.99
CMBL Supplier 150,000.00 8.31
Shaoguan Hydraulic Parts Factory Co Ltd Supplier 50,960.00 2.82
Total 1,689,777.12 93.66
(3) The Group has no significant aging over one year prepayment.
5. Interest receivable
(1) Interest receivable
Unit: RMB
Category Closing balance Opening balance
Fixed term deposit 1,264,914.26 -
(2) The Group has no significant overdue interest.
6. Dividends receivable
(1) Dividends receivable
Unit: RMB
Impairment
Opening Closing appeared or
Item balance Increase Decrease balance not
China Overseas Harbor Affairs
- - No
(Laizhou) Co., Ltd. 54,159,674.42 54,159,674.42
China Ocean Shipping Agency
- - No
(Shenzhen) Company Limited 8,997,000.00 8,997,000.00
Jiang Su Ninghu Expressway
- 420,000.00 - 420,000.00 No
Company Limited
MEDIA PORT INVESTMENTS
LIMITED
- 30,167,872.32 30,167,872.32 - No
Total - 93,744,546.74 93,324,546.74 -
(2) The Group has no dividends receivable aging more than one year.
- 42 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
7. Other receivables
(1) Disclosure of other receivables by categories:
Unit: RMB
Closing balance Opening balance
Carrying amount Bad debt provision Carrying amount Bad debt provision
Proportion Proportion Proportion Proporti
Category Amount (%) Amount (%) Book value Amount (%) Amount on (%) Book value
Other receivables that are individually
significant and for which bad debt - - - - - - - - - -
provision has been assessed individually
Other receivables for which bad debt provision has been assessed by credit risk portfolios
Portfolio 1
11,290,093.48 58.61 100,000.00 0.89 11,190,093.48 9,736,887.93 34.85 100,000.00 1.03 9,636,887.93
Portfolio 2
7,972,493.98 41.39 463,424.48 5.81 7,509,069.50 18,205,610.78 65.15 1,194,629.70 6.56 17,010,981.08
Subtotal of portfolios
19,262,587.46 100.00 563,424.48 2.92 18,699,162.98 27,942,498.71 100.00 1,294,629.70 4.63 26,647,869.01
Other receivables that are not individually
significant but for which bad debt provision - - - - - - - - - -
has been assessed individually
Total
19,262,587.46 100.00 563,424.48 2.92 18,699,162.98 27,942,498.71 100.00 1,294,629.70 4.63 26,647,869.01
Other receivables portfolios for which bad debt provision has been assessed using the aging
analysis
Unit: RMB
Closing balance Opening balance
Carrying Bad debt Proportion Carrying Bad debt Proportio
Aging amount provision (%) Book value amount provision n (%) Book value
Within 1 year 7,509,069.50 - - 7,509,069.50 17,704,281.50 723,624.26 4.09 16,980,657.24
More than 1 year
- - - - 37,904.80 7,580.96 20.00 30,323.84
but not exceeding 2 years
More than 2 years
- - - - - - - -
but not exceeding 3 years
More than 3 years 463,424.48 463,424.48 100.00 - 463,424.48 463,424.48 100.00 -
Total 7,972,493.98 463,424.48 5.81 7,509,069.50 18,205,610.78 1,194,629.70 6.56 17,010,981.08
(2) Increase, reverse and write-off of bad debt provision
Unit: RMB
Decrease Translate
foreign currency
Item Opening balance Increase Reversal Write-off statements Closing balance
Other receivable 1,294,629.70 - 731,205.22 - - 563,424.48
(3) Other receivable has not been written off during the year.
(4) Disclosure of other receivables by nature
Unit: RMB
Item Closing balance Opening balance
Temporary payments 6,704,948.86 7,216,846.26
Deposits 4,927,605.99 4,021,619.49
Others 7,630,032.61 16,704,032.96
Total 19,262,587.46 27,942,498.71
- 43 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
7. Other receivables - continued
(5) Top five balances of other receivables classified by creditors
Unit: RMB
Proportion of the
amount to the total
accounts receivable
Name of company Nature of the fund Amount Aging (%) Bad debt provision
More than 2 year but
Temporary payments not exceeding 3 years
Nanshan Group 2,822,760.39 14.65 -
from related parties and more than 3
years
Finance Department of
Deposits and guarantee 1,600,000.00 more than 3 years 5.73 -
Ministry of Transport
Temporary payments
MSC 970,762.13 Within one year 5.04 -
from related parties
Temporary payments
CMBL 2,180,743.58 Within one year 11.32 -
from related parties
Shenzhen Nanhai Grain
Land rents 1,066,345.02 Within one year 5.54 -
Industrial Co., Ltd.
Total 8,640,611.12 44.86 -
8. Inventories
(1) Categories of inventories
Unit: RMB
30 Jun. 2017 31 Dec. 2016
Provision for Provision for
decline in value of decline in value of
Item Carrying amount inventories Book value Carrying amount inventories Book value
Spare parts 18,075,502.40 972,744.93 17,102,757.47 15,138,488.70 972,744.93 14,165,743.77
Fuel 662,550.11 - 662,550.11 605,666.32 - 605,666.32
Low priced and easily
161,196.58 - 161,196.58 - - -
worn articles
Total 18,899,249.09 972,744.93 17,926,504.16 15,744,155.02 972,744.93 14,771,410.09
(2) Provision for decline in value of inventories
Unit: RMB
Decrease
Item Opening balance Increase Reversal Write-off Closing balance
Spare parts 972,744.93 - - - 972,744.93
9、Other current assets
Unit: RMB
Item Closing balance Opening balance
Added-value tax to be certified and deducted 19,698,853.34 16,832,212.36
- 44 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
10. Available-for-sale financial assets
(1) Available-for-sale financial assets
Unit: RMB
Closing balance Opening balance
Carrying Provision for Carrying Provision for
Item amount impairment Book value amount impairment Book value
Available-for-sale
26,837,500.00 3,128,300.00 23,709,200.00 25,587,500.00 3,128,300.00 22,459,200.00
equity instruments
Measured at fair value 9,800,000.00 - 9,800,000.00 8,550,000.00 - 8,550,000.00
Measured at cost 17,037,500.00 3,128,300.00 13,909,200.00 17,037,500.00 3,128,300.00 13,909,200.00
Total 26,837,500.00 3,128,300.00 23,709,200.00 25,587,500.00 3,128,300.00 22,459,200.00
(2) Available-for-sale financial assets measured at fair value at the end of the year
Unit: RMB
Classification of available-for-sale financial assets Available-for-sale equity instruments
Cost of equity instruments 1,120,000.00
Fair value 9,800,000.00
Accumulated amount of changes in fair value included in the other
8,680,000.00
comprehensive income
Provision amount for impairment -
Note: The available-for-sale financial assets held by the Company represent the circulating shares
of Jiang Su Ninghu Expressway Company Ltd at the end of the year.
(3) Available-for-sale financial assets measured at cost at the end of the year
Unit: RMB
Carrying amount Provision for impairment Proportion of
ownership Cash
interests in dividends
Opening Closing Opening Closing the investee for the
Investees balance Increase Decrease balance balance Increase Decrease balance (%) period
Shenzhen Petro-chemical
3,500,000.00 - - 3,500,000.00 3,117,800.00 - - 3,117,800.00 0.26 -
Industry (Group) Company Limited
Guangdong Guang Jian
27,500.00 - - 27,500.00 10,500.00 - - 10,500.00 0.02 -
Group Company Limited
China Ocean Shipping
Agency (Shenzhen) 13,510,000.00 - - 13,510,000.00 - - - - 15.00 8,997,000.00
Company Limited
Total 17,037,500.00 - - 17,037,500.00 3,128,300.00 - - 3,128,300.00 8,997,000.00
Note: The available-for-sale financial assets measured at cost are equity investments of Shenzhen
Petro-chemical Industry (Group) Company Limited, Guangdong Guang Jian Group
Company Limited and China Ocean Shipping Agency (Shenzhen) Company Limited. None
of the stocks of above-mentioned companies are traded in market or fair value could be
measured reliably, hence, the Group measures these equity investments under cost method.
(4) Movements of available-for-sale financial assets in the reporting period
Unit: RMB
Category Available-for-sale equity instruments
Provision amount for impairment at the beginning of the year 3,128,300.00
Increase in the current year -
Decrease in the current year -
Provision amount for impairment at the end of the year 3,128,300.00
- 45 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
11. Long-term equity investments
Unit: RMB
Changes
Investment profit Reconciling items from Cash dividends or Closing value of
Accounting or loss under equity other comprehensive Other equity profits announced of Provision for provision for
Investee method Investment cost Opening balance Increase Decrease method income movements issuance impairment Others Closing balance impairment
I. Joint ventures
China Overseas Harbor Affairs (Laizhou) Co., Ltd.(Note 1) Equity method 749,655,300.00 794,981,306.22 - - 29,155,806.47 - - 54,159,674.42 - - 769,977,438.27 -
II. Associates
China Merchants Holdings (International) Information Technology -
Equity method 1,875,000.00 14,595,240.92 - - 2,267,364.00 - - - - - 16,862,604.92
Company Ltd.
-
CMBL Equity method 280,000,000.00 339,931,866.76 - - 5,476,000.01 - - - - - 345,407,866.77
-
MediaPortInvestmentsLimited("MPIL") (Note 2) Equity method 139,932.00 340,919,242.63 - - 23,193,786.97 - - 32,658,612.69 - - 331,454,416.91
-
Subtotal 282,014,932.00 695,446,350.31 - - 30,937,150.98 - - 32,658,612.69 - - 693,724,888.60
-
Total 1,031,670,232.00 1,490,427,656.53 - - 60,092,957.45 - - 86,818,287.11 - - 1,463,702,326.87
Note 1: The Company holds 40% equity interests in China Overseas Harbor Affairs (Laizhou) Co., Ltd. (hereinafter "COHA (Laizhou)"). According
to its articles of incorporation, significant matters such as operating decisions can be passed only when jointly approved by directors of the
Company and the other ventures. Therefore, COHA (Laizhou) is deemed to be under common control of Chiwan Wharf and the other
shareholders; accordingly COHA (Laizhou) is accounted for as a joint venture.
Note 2: On 30 September 2002, China Merchants Holdings (International) Company Limited (the "CMHI", a listed company in Hong Kong) and
Shenzhen South Oil (Group) Company Limited (the "SSOG") entered into an agreement called "Agreement on Cooperation and
Development of Mawan Port" (the "Development Agreement") to incorporate three joint ventures, namely Shenzhen Mawan Wharf Co.,
Ltd.("SMW"), SMP and Shenzhen Mawan Terminals Co., Ltd. ("SMT") (together referred to as "Mawan Companies"), to construct and
operate the berth 0#, 5#, 6#, 7# and 8# in Mawan Port. According to the Development Agreement, CMHI and the Group will jointly set up
Media Port Investments Limited (the "MPIL") with equal percentage of equity held respectively. MPIL then incorporates the
abovementioned three joint ventures together with SSOG, and MPIL has 60% equity in each of the three joint ventures.
- 46 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
12. Investment properties
(1) Investment properties measured under cost method
Unit: RMB
Opening Closing
carrying carrying
Item amount Increase Decrease amount
I. Total original carrying amount 43,579,258.14 - - 43,579,258.14
1. Buildings 14,947,127.30 - - 14,947,127.30
2. Land use right 28,632,130.84 - - 28,632,130.84
II. Total accumulated depreciation
19,932,344.37 412,916.04 - 20,345,260.41
and amortization
1. Buildings 5,463,497.40 156,179.82 - 5,619,677.22
2. Land use right 14,468,846.97 256,736.22 - 14,725,583.19
III. Total net book value of investment
23,646,913.77 - - 23,233,997.73
property
1. Buildings 9,483,629.90 - - 9,327,450.08
2. Land use right 14,163,283.87 - - 13,906,547.65
IV. Total accumulated amount of
provision for impairment losses of - - - -
investment property
1. Buildings - - - -
2. Land use right - - - -
V. Total carrying value of
23,646,913.77 - - 23,233,997.73
investment property
1. Buildings 9,483,629.90 - - 9,327,450.08
2. Land use right 14,163,283.87 - - 13,906,547.65
Note: Depreciation and amortization for the current period is RMB412,916.04.
(2) Investment properties without ownership certificates
As of 30 Jun. 2017, the Group has not obtained any ownership certificates of investment
properties. For buildings located within the scope of Chiwan watershed with net book value of
RMB20,080,637.54 (original carrying amount: RMB40,030,725.05), the underlying reasons and
management's resolutions for obtaining certificates of title are set out in Note (V) 15, and the rest
certificates of title are under the process of application.
- 47 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENT - continued
13. Fixed assets
(1) Fixed assets
Unit: RMB
Opening carrying Closing carrying
Item amount Increase Decrease amount
I. Total original carrying amount 5,505,843,686.69 50,057,165.28 29,432,067.51 5,526,468,784.46
Including: Port and terminal facilities 1,991,871,480.44 21,041,986.99 - 2,012,913,467.43
Container yards and buildings 1,063,057,243.72 - - 1,063,057,243.72
Mechanical equipment 2,059,095,193.73 18,560,645.16 18,016,696.05 2,059,639,142.84
Motor vehicles, cargo ships
and tugboats
276,010,110.61 10,138,675.04 11,407,030.37 274,741,755.28
Other equipment 115,809,658.19 315,858.09 8,341.09 116,117,175.19
II. Total accumulated depreciation 2,411,610,375.19 93,366,465.87 26,484,411.97 2,478,492,429.09
Including: Port and terminal facilities 477,002,365.71 20,813,743.88 - 497,816,109.59
Container yards and buildings 283,028,128.52 12,356,696.03 - 295,384,824.55
Mechanical equipment 1,409,426,856.11 50,759,507.35 16,215,026.43 1,443,971,337.03
Motor vehicles, cargo ships
and tugboats
156,226,016.48 6,508,846.79 10,266,327.34 152,468,535.93
Other equipment 85,927,008.37 2,927,671.82 3,058.20 88,851,621.99
III. Total net book value of fixed assets 3,094,233,311.50 - - 3,047,976,355.37
Including: Port and terminal facilities 1,514,869,114.73 - - 1,515,097,357.84
Container yards and buildings 780,029,115.20 - - 767,672,419.17
Mechanical equipment 649,668,337.62 - - 615,667,805.81
Motor vehicles, cargo ships
and tugboats
119,784,094.13 - - 122,273,219.35
Other equipment 29,882,649.82 - - 27,265,553.20
IV. Total provision for impairment losses 57,419,468.96 - - 57,419,468.96
Including: Port and terminal facilities 4,261,599.48 - - 4,261,599.48
Container yards and buildings 53,157,869.48 - - 53,157,869.48
Mechanical equipment - - - -
Motor vehicles, cargo ships
and tugboats
- - - -
Other equipment - - - -
V. Total carrying value of fixed assets 3,036,813,842.54 - - 2,990,556,886.41
Including: Port and terminal facilities 1,510,607,515.25 - - 1,510,835,758.36
Container yards and buildings 726,871,245.72 - - 714,514,549.69
Mechanical equipment 649,668,337.62 - - 615,667,805.81
Motor vehicles, cargo ships
and tugboats
119,784,094.13 - - 122,273,219.35
Other equipment 29,882,649.82 - - 27,265,553.20
Note 1: The increase of total original carrying amount for current period consists of new
acquisition of RMB10,738,341.33, an increase of RMB39,318,823.95 of amount
transferred from construction in progress. The decrease of total original carrying amount
for current period consists of a decrease of RMB29,427,124.42 resulting from disposal of
fixed assets.
- 48 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
13. Fixed assets - continued
Note 2: The increase in accumulated depreciation for current period consists of charge for the
current year of RMB93,306,636.81. The decrease in accumulated depreciation for current
period consists of a decrease of RMB26,484,411.97 resulting from disposal of fixed
assets .
Note 3: As of 30 Jun. 2017, the Group has no fixed assets that used as collateral.
Note 4: As of 30 Jun. 2017, the certificates of title for the Group's buildings with a net book value
of RMB316,680,114.53 (total original carrying amount: RMB442,079,399.52) have not
yet been obtained. For buildings located within the scope of Chiwan watershed with net
book value of RMB30,751,333.69 (original carrying amount: RMB118,989,052.62), the
underlying reasons and management's solutions for obtaining certificates of title are set
out in Note (V) 15, and the rest certificates of title are under the process of application.
(2) Other issues
Unit: RMB
Item Amount Note
The original amounts of fixed assets fully depreciated but still
638,624,344.81
in use at 30 Jun. 2016
Closing original amount of temporary idle fixed assets -
Fixed assets disposed or retired in the current year
Original amount of fixed assets disposed or retired
29,427,124.42
in the current year
Net book value of fixed assets disposed or retired
2,942,712.45
in the current year
Gain or loss on disposal or retire of fixed assets (448,433.95)
14. Construction in progress
(1) Details of construction in progress are as follows:
Unit: RMB
Closing Balance Opening Balance
Provision for Provision for
Item Carrying amount impairment Book value Carrying amount impairment Book value
Relavent construction work
of 50.86 meters coastline, 5,302,912.96 - 5,302,912.96 5,130,743.15 - 5,130,743.15
Machong Port
Bulk grain warehouses
Phase III,Machong Port
198,113.21 - 198,113.21 198,113.21 - 198,113.21
Bulk grain warehouses
Phase II,Machong Port
161,069,706.65 - 161,069,706.65 123,199,182.41 - 123,199,182.41
Technological transformation of
Berth 7# , Chiwan Port
- - - 20,061,782.13 - 20,061,782.13
Others 17,137,489.23 - 17,137,489.23 16,014,537.41 - 16,014,537.41
Total 183,708,222.05 - 183,708,222.05 164,604,358.31 - 164,604,358.31
- 49 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENT - continued
14. Construction in progress - continued
(2) Changes in significant construction in progress
Unit: RMB
Proportion of Interest
accumulated Amount of Including: capitalisation
Transfer to fixed Decrease in construction accumulated capitalised rate for the
Budget Opening Increase in the and intangible the current investment in Construction capitalised interest for the currentperio
Item amount balance current period assets period Closing balance budget progress interest current period d (%) Capital source
Relavent construction work of 50.86
meters 36,000,000.00 5,130,743.15 172,169.81 - - 5,302,912.96 14.73 14.73 - - - Self-funding
coastline, Machong Port
Bulk grain warehouses Phase III,
680,000,000.00 198,113.21 - - - 198,113.21 0.03 0.03 - - - Self-funding
Machong Port
Bulk grain warehouses Phase II,
320,000,000.00 123,199,182.41 37,870,524.24 - - 161,069,706.65 50.33 50.33 1,214,868.30 1,107,689.13 4.35 Self-funding
Machong Port
Technological transformation of
Berth 7# , Chiwan Port
29,500,000.00 20,061,782.13 3,102,424.93 23,164,207.06 - - 78.52 100.00 - - - Self-funding
Others 168,029,423.62 16,014,537.41 17,345,423.40 16,154,616.89 67,854.69 17,137,489.23 19.85 19.85 - - - Self-funding
Total 1,233,529,423.62 164,604,358.31 58,490,542.38 39,318,823.95 67,854.69 183,708,222.05 1,214,868.30 1,107,689.13
- 50 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
15. Intangible assets
Unit: RMB
Opening carrying Closing carrying
Item amount Increase Decrease amount
I. Total original carrying amount 1,604,710,188.11 - - 1,604,710,188.11
Land use rights - prepaid under lease (Note 2) 1,200,267,573.00 - - 1,200,267,573.00
Land use rights - prepaid under investment (Note 2) 122,623,476.00 - - 122,623,476.00
Land use rights - purchased 116,702,512.59 - - 116,702,512.59
Computer software 33,176,476.52 - - 33,176,476.52
Sea area use rights 71,940,150.00 - - 71,940,150.00
Coast line use rights 60,000,000.00 - - 60,000,000.00
II. Total accumulated amortization 593,942,737.10 18,735,921.56 - 612,678,658.66
Land use rights - prepaid under lease (Note 2) 488,732,433.09 13,877,084.00 - 502,609,517.09
Land use rights - prepaid under investment (Note 2) 59,881,130.78 1,388,439.66 - 61,269,570.44
Land use rights - purchased 8,861,845.00 1,193,113.08 - 10,054,958.08
Computer software 24,089,592.09 864,122.94 - 24,953,715.03
Sea area use rights 9,833,948.08 719,401.50 - 10,553,349.58
Coast line use rights 2,543,788.06 693,760.38 - 3,237,548.44
III.Total net carrying amount of intangible assets 1,010,767,451.01 - - 992,031,529.45
Land use rights - prepaid under lease (Note 2) 711,535,139.91 - - 697,658,055.91
Land use rights - prepaid under investment (Note 2) 62,742,345.22 - - 61,353,905.56
Land use rights - purchased 107,840,667.59 - - 106,647,554.51
Computer software 9,086,884.43 - - 8,222,761.49
Sea area use rights 62,106,201.92 - - 61,386,800.42
Coast line use rights 57,456,211.94 - - 56,762,451.56
IV.Total provision for impairment - - - -
Land use rights - prepaid under lease - - - -
Land use rights - prepaid under investment - - - -
Land use rights - purchased - - - -
Computer software - - - -
Sea area use rights - - - -
Coast line use rights - - - -
V.Total carrying value of intangible assets 1,010,767,451.01 - - 992,031,529.45
Land use rights - prepaid under lease (Note 2) 711,535,139.91 - - 697,658,055.91
Land use rights - prepaid under investment (Note 2) 62,742,345.22 - - 61,353,905.56
Land use rights - purchased 107,840,667.59 - - 106,647,554.51
Computer software 9,086,884.43 - - 8,222,761.49
Sea area use rights 62,106,201.92 - - 61,386,800.42
Coast line use rights 57,456,211.94 - - 56,762,451.56
Note 1: The amortization for the current period is RMB18,735,921.56.
- 51 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENT - continued
15. Intangible assets - continued
Note 2: The Group has obtained the land use right for berth and container yard located in Chiwan
watershed area with original amount of RMB1,400,288,984.00 from Nanshan Group. The
tenure ranging between 20 - 50 years. The land with a total area of 1,049,946.00 square
meters consists of an area of 2.2 square kilometers invested by Shenzhen Investment
Holding Corporation, a stockholder of Nanshan Group, and a land arising from marine
reclamation by Nanshan Group.
The land use rights for the plot of 270,692 sq. meters (original amount:
RMB122,623,476.00) was contributed by Nanshan Group as capital injection at corporate
restructuring of the Company. The rest land use rights were obtained from Nanshan Group
by long-term leasing.
Since Nanshan Group has yet obtained official certificates of land use rights for the above
lands so far, the Group has no certificates of title for relevant land and buildings either.
On 20 March 2001, 18 June 2003 and 29 September 2004, Nanshan Group made
commitments on all the land use rights obtained by the Group from it as of the
commitment date respectively: Nanshan Group has no right to withdraw the commitment
and will unconditionally consent that, if the Group suffers loss, bears expense and liability,
is claimed for compensation or runs into lawsuit, for any actually or potentially illegal and
non-executable issues arising from land use right agreements and their relevant documents
which signed or will be signed by the Group, Nanshan Group guarantees that the acquiring
party and its inheritor of those land use right will be fully exempted from above issues.
Hence, directors of the Company believe there is no significant impairment risk in respect
of the absence of land use right certificate and no significant contingent liability.
The management notes that Nanshan Group is positively approaching relevant government
authorities to solve the above historical land problem; however, it cannot predict the exact
time to obtain legal certificates of title for above land and relevant building property
ownership certificates.
16. Goodwill
Unit: RMB
Increase for the Decrease for the
Investee Opening balance current period current period Closing balance
Chiwan Container Terminal
10,858,898.17 - - 10,858,898.17
Company Limited
Note: The goodwill arose from the acquisition of the minority interests in Chiwan Container
Terminal Company Limited in prior years, being the difference of the additional cost of
investment and the Group's share of the fair value of the identifiable net assets in Chiwan
Container Terminal Company Limited. Based on past years' operation performance and
development forecast of the Company, the management holds the opinion that these is no
need to allocate impairment to goodwill arising from the investment of Chiwan Container
Terminal Company Limited.
- 52 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENT - continued
17. Long-term prepaid expenses
Unit: RMB
Residual
useful
Item Opening balance Increase Amortization Other decreases Closing balance Original Cost life
Construction expenditure of
54,889,173.04 - 1,028,452.20 - 53,860,720.84 71,991,655.56 26 years
Tonggu sea-route (Note )
Golf membership 55,303.60 - 10,939.50 - 44,364.10 2,028,316.60 1-6 years
Total 54,944,476.64 - 1,039,391.70 - 53,905,084.94 74,019,972.16
Note 1: In 2007, Shenzhen municipal government launched the construction work of the public
sea route connecting Tonggu sea route, Shekou port area, Chiwan port area, Mawan port
area, Qianhaiwan port area and Dachanwan port area ("Connecting Sea Route"). In
compliance with the government resolution, 60% of dredging expenditure would be born
by the investee companies while the remaining 40% born by the government. 35% of
the expenditure born by the investee companies was assumed by the port operators in
Western Shenzhen port , and the allocation portion to each operator was determined on
the basis of function, waterfront length, and berthing ship of each port operator. The
Tonggu sea route construction expenses allocated to the Group is amortized on a
straight-line basis over 35 years of the expected useful lives of Connecting Sea Route
starting from 2008 when the Tonggu Sea Route is put into use.
18. Deferred tax assets and deferred tax liabilities
(1) Deferred tax assets that are presented at the net amount without offsetting
Unit: RMB
Closing balance Opening balance
Deductible temporary Deductible temporary Deferred tax
Item differences Deferred tax assets differences assets
Deferred income 24,550,555.40 6,137,638.85 24,550,555.40 6,137,638.85
Provision for impairment losses of assets 5,947,568.77 1,294,075.11 5,947,568.77 1,294,075.11
Depreciation of fixed assets and amortization
620,721.18 146,555.33 620,721.18 146,555.33
of intangible assets
Organization costs 21,347,408.91 4,410,860.21 21,347,408.91 4,410,860.21
Others 1,105,415.87 183,203.97 1,303,115.87 232,628.97
Total 53,571,670.13 12,172,333.47 53,769,370.13 12,221,758.47
(2) Deferred tax liabilities that are presented at the net amount without offsetting
Unit: RMB
Closing balance Opening balance
Taxable temporary Deferred tax Taxable temporary
Item differences liabilities differences Deferred tax liabilities
Depreciation of fixed assets and
- - - -
amortization of intangible assets
Change in fair value of available-
for-sale financial assets
8,680,000.00 2,170,000.00 7,430,000.00 1,857,500.00
Total 8,680,000.00 2,170,000.00 7,430,000.00 1,857,500.00
(3) Deferred tax assets or liabilities that are presented at the net amount after offsetting
Unit: RMB
Closing amount of Closing amount of Opening amount of Opening amount of
deferred tax assets and deferred tax assets or deferred tax assets and deferred tax assets or
Item liabilities that are offset liabilities after offsetting liabilities that are offset liabilities after offsetting
Deferred tax assets - 12,172,333.47 - 12,221,758.47
Deferred tax liabilities - 2,170,000.00 - 1,857,500.00
- 53 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENT - continued
18. Deferred tax assets and deferred tax liabilities - continued
(4) Details of unrecognized deferred tax assets
Unit: RMB
Item Closing balance Opening balance
Deductible temporary differences 96,800,856.43 102,828,757.97
Deductible losses 177,001,767.54 177,001,767.54
Total 273,802,623.97 279,830,525.51
Note: Deferred tax assets are not recognized for the above-mentioned deductible temporary
differences and deductible losses due to uncertainty whether sufficient taxable profits will
be available in the future.
(5) Deductible losses for unrecognized deferred tax assets will be expired in the following years
Unit: RMB
Year Closing balance Opening balance Note
2017 30,345,268.82 30,345,268.82
2018 75,300,266.59 75,300,266.59
2019 49,621,628.48 49,621,628.48
2020 3,145,611.79 3,145,611.79
2021 18,588,991.86 18,588,991.86
Total 177,001,767.54 177,001,767.54
19. Other non-current assets
Unit: RMB
Item Closing balance Opening balance
Land Use Right (Note) 132,334,704.86 132,369,704.86
Prepayments on construction 1,348,280.82 -
Total 133,682,985.68 132,369,704.86
Note: On March and October 2006, November 2007 and September 2014, the Company entered
into Cooperation Framework Agreement on Usage of Coastline and Land for 2#- 5# Berth
at Machong Port in Dongguan and its supplementary agreements with Dongguan Humen
Port Administration Commission. The Company purchased use rights of coastline and land
with a total area of 800,000 square meters, including waters with depth of 700 meters from
the front of terminal, and coastline from berth 2# to berth 5# with a total length of 1,200
meters at Dongguan Machong Port at a consideration of RMB260,000,000. As the Group
has not obtained the use right certificates for the above land, the relevant prepayments were
therefore recognized as other non-current assets.
- 54 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENT – continued
20. Accounts payable
(1) Details of accounts payable
Unit: RMB
Item Closing balance Opening balance
Service 44,252,639.72 46,961,672.78
Material purchase 35,888,557.79 21,834,346.04
Rental 10,656,649.21 10,891,405.40
Construction 5,994,820.46 9,619,783.53
Equipment 1,797,529.92 137,389.35
Total 98,590,197.10 89,444,597.10
(2) There is no significant accounts payable agaed more than one year at the end of the year.
21. Receipts in advance
Unit: RMB
Item Closing balance Opening balance
Service fee receipt in advance 129,822,174.32 30,668,212.67
22. Employee benefits payable
(1) Employee benefits payable
Unit:RMB
Increase for the Decrease for the
Item Opening balance current period current period Closing balance
I. Short-term benefits 86,581,824.26 147,850,324.24 177,383,011.68 57,049,136.82
II. Post-employment benefits - defined
contribution plans
- 18,728,233.34 18,728,233.34 -
III. Termination benefits 1,996,668.00 2,410,127.69 4,406,795.69 -
Total 88,578,492.26 168,988,685.27 200,518,040.71 57,049,136.82
(2) Short-term benefits
Unit:RMB
Increase for the Decrease for the
Item Opening balance current period current period Closing balance
I. Wages and salaries, bonuses, allowances
and subsidies
74,217,691.80 123,073,122.72 152,633,213.65 44,657,600.87
II. Staff welfare - 3,992,171.99 3,992,171.99 -
III. Social insurance charges 535.54 5,250,958.47 5,251,494.01 -
Including:
Medical insurance
- 4,212,709.87 4,212,709.87 -
Work injury insurance 535.54 581,301.87 581,837.41 -
Maternity insurance - 456,946.73 456,946.73 -
IV. Housing funds - 9,672,140.58 9,672,140.58 -
V. Labor union and employee education funds 12,363,596.92 3,424,022.14 3,396,083.11 12,391,535.95
VI. Others - 2,437,908.34 2,437,908.34 -
Total 86,581,824.26 147,850,324.24 177,383,011.68 57,049,136.82
Note: There are no amounts in arrears under the employee benefits payable.
- 55 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENT – continued
22. Employee benefits payable- continued
(3) Post-employement benefits - defined contribution plans
Unit: RMB
Increase for the Decrease for the
Item Opening balance current period current period Closing balance
I. Basic pension (Note 1) - 13,061,176.94 13,061,176.94 -
II. Unemployment insurance (Note 1) - 213,805.12 213,805.12 -
III. Enterprise annuity plan (Note 2) - 5,453,251.28 5,453,251.28 -
Total - 18,728,233.34 18,728,233.34 -
Note 1: The Group participates in the social security contributions and the unemployment
insurance plan established by government institutions as required. According to such
plans, the Group contributes 14% ( 13% for staffs without Shenzhen householder
register ) , 2% (1% for staffs in Dongguan City) respectively to such plans based on the
employee's basic salary each month.
During the year, the Group is obliged to contribute RMB 11,945,008.55 and RMB
208,267.51 respectively to the social security contributions and the unemployment
insurance plan (2015: RMB 11,277,331.36 and RMB 338,221.02). As at 30 Jun. 2016,
the Group have no outstanding contributions to be paid to the social security
contributions and the unemployment insurance plan.
Note 2: On 3 June 2008, the Group participated in a group defined enterprise annuity plan of
Nanshan Group approved by Shenzhen municipal government. This supplementary
pension contributions were paid into a managed account through Nanshan Group.
23. Taxes payable
Unit: RMB
Item Opening balance Increase Decrease Closing balance
Enterprise income tax 20,001,270.23 57,211,155.05 45,847,403.00 31,365,022.28
Withholding tax (Note) 21,288,297.33 - - 21,288,297.33
Value-added-tax 3,472,562.39 13,170,091.84 14,561,842.79 2,080,811.44
Others 3,742,699.85 17,068,122.05 16,033,145.76 4,777,676.14
Total 48,504,829.80 87,449,368.94 76,442,391.55 59,511,807.19
Note: The amount represents the withholding tax provided by the Group at the rate of 5% or 10%
when paying out dividends to foreign shareholders and Chiwan Wharf Holdings (H.K.)
Limited located in Hong Kong.
- 56 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENT - continued
24. Interest payable
Unit: RMB
Item Closing balance Opening balance
Interest on corperate debentures 6,371,260.30 1,952,876.72
Interest on short-term borrowings - 614,383.56
Total 6,371,260.30 2,567,260.28
25. Dividends payable
Unit: RMB
Item Closing balance Opening balance
Ordinary share dividends 319,802,810.47 -
Including: Nanshan Group 104,004,785.23 -
Shenzhen Malai Warehouse Co., Ltd. 79,950,702.77 -
Public A Shares 46,619,189.19 -
Public B Shares 89,228,133.28 -
26. Other payables
(1) Other payables presented by the nature of amount
Unit: RMB
Item Closing balance Opening balance
Amount payable for construction and quality warranty 26,627,528.10 37,664,828.31
Temporary receipts 33,281,789.88 11,011,631.18
Security expense payable 3,643,939.46 7,942,731.71
Deposits received 4,781,811.05 4,424,738.15
Others 6,770,451.11 13,546,464.74
Total 75,105,519.60 74,590,394.09
(2) Significant other payables aged more than one year
There is no significant other payables agaed more than one year at the end of the year.
- 57 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENT - continued
27.Other current liabilities
(1) Short-term bonds payable
Unit: RMB
Item Closing balance Opening balance
Short-term bonds payable - 250,000,000.00
(2) Changes in short-term bonds payable:
Unit: RMB
Interest
Amount issued accrued at par Discount or
Term of in the current during the premium Repayment in the Closing
Name of bond Face value Date of issue the bond Amount of issue Opening balance period year amortization current year balance
16 Chiwan port SCP003(Note) 250,000,000.00 07/12/2016 180days - 250,000,000.00 - 4,193,835.62 - 250,000,000.00 -
Total 250,000,000.00 - 250,000,000.00 - 4,193,835.62 - 250,000,000.00 -
Note: According to the Notice of Registration Acceptance (filed as Zhong Shi Xie Zhu [2015] No.
SCP121) issued by China's Interbank Market Dealers Association received by the
Company on 5 June 2015, the Association approved the Company's short-term financing
registration of RMB 1.6 billion in total.
28. Bonds payable
(1) Bonds payable
Unit: RMB
Item Closing balance Opening balance
Corporate bonds 298,629,041.09 298,331,506.85
(2) Changes of bonds payable:
Unit: RMB
Repayment
Amount Discount or in the
Term of the issued in the Interest accrued at premium current
Name of bonds Face value Date of issue bond Amount of issue Opening balance current year par during the year amortization year closing balance
13 ChiWan 01(Note) 300,000,000.00 11/10/2016 3 years 300,000,000.00 298,331,506.85 - 4,418,383.58 297,534.24 - 298,629,041.09
Total 300,000,000.00 298,331,506.85 - 4,418,383.58 297,534.24 - 298,629,041.09
Note: According to the Notice of Registration Acceptance (filed as Zhong Shi Xie Zhu [2016]
MTN No. 325) issued by the China's Interbank Market Dealers Association received by
the Company on 6 August 2016. The Company is entitled to issue mid-term bills no more
than RMB 800,000,000 with an effective period of 2 years.
- 58 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(VI) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
29. Special payables
Unit: RMB
Item Opening balance Increase Decrease Closing Balance Reason
Refunds of Harbor Construction Fee 34,326,860.44 - 999,193.80 33,327,666.64 Note
Note: The item is refunds of harbor construction fee from Shenzhen Traffic Bureau. According
to Measures of Harbor Construction Fee Management released by Ministry of Finance,
the funds should be managed in separate account and can be only used on fundamental
facilities' construction of marine transportation.
30. Deferred income
Unit: RMB
Closing
Item Opening balance Increase Decrease Balance Reason
Deferred income 64,613,319.88 200,643.74 3,990,183.72 60,823,779.90
Including: Berth priority right 35,636,464.68 200,643.74 3,491,382.54 32,345,725.88 Note 1
Government grants related
28,976,855.20 - 498,801.18 28,478,054.02 Note 2
to assets
Total 64,613,319.88 200,643.74 3,990,183.72 60,823,779.90
Less: Non-current liabilities due within
- - - -
one year
Including: Berth priority right - - - -
Government grants related
- - - -
to assets
Deferred income 64,613,319.88 - - 60,823,779.90
Note 1: This item represents berth priority right with total amounts to USD14,000,000 that agreed
in the contract signed in 2003. The Group should satisfy the berthing requirement of
contracted customers in priority during the contract period. According to the contract, the
berth priority right should be amortized over twenty years on the straight-line basis.
Note 2: The item represents the government grants received by the Group which is based on the
Announcement Released by National Development and Reform Commission about 2010
Investment Plans within Budget of Grains and Modern Logistics Program (NDRC[2010]
No.1263), the Announcement Released by Guangdong Provincial Department of Finance
about 2012 Provincial Special Funds to Guide the Development of Modern Service
Project (Guangdong Production Letter [2012] No. 621) and Transportation of energy
saving special funds Interim Measures (Finance Building [2011] No. 374),Nanshan
District, Shenzhen, energy saving projects funded sub contract, Announcement Released
by Reform and Development Commission of Guangdong Province and the Grain Bureau
of Guangdong Province about 2015 Investment Plans within Budget of Grains and
Modern Logistics Program (GDRC[2015] No.521), Measures Released by Dongguan
Government about Grants Management to Special Fund Program for the Development of
National and Provincial Industries (DGM[2013]No.162), Interim Measures Released by
Shenzhen Government about the Management to Special Fund used in Recycling
Economy and Energy Savings, and the Reply of Ministry of Transport to Implementation
Program of Building 19 Regional Projects such as the Construction of a Green Recycling
Low-carbon Transportation City by Beijing Government (Transportation Law
Letter[2014]No.499) . The government grants shall be amortized on the straight-line basis
over the useful life of the related assets.
- 59 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(VI) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
30. Deferred income - continued
Programs related with government grants:
Unit: RMB
The amount included Related to
New subsidy of in operating income Other assets/Related to
Liability Program Opening balance the year of the year changes Closing Balance income
Special funds for modern
23,193,044.06 - 83,478.24 - 23,109,565.82 Related to assets
logistics project
Special funds for the
development of modern 1,357,511.80 - 26,022.60 - 1,331,489.20 Related to assets
service guide
Special funds for energy-
saving and emission 1,770,000.00 - 180,000.00 - 1,590,000.00 Related to assets
reduction of transportation
Green carbon harbor thematic
projects subsidy granted by 66,299.40 - 9,300.30 - 56,999.10 Related to assets
central government
Reward for energy saving 1,806,666.62 - 100,000.02 - 1,706,666.60 Related to assets
Subsidy for electric buses 783,333.32 - 100,000.02 - 683,333.30 Related to assets
Total 28,976,855.20 - 498,801.18 - 28,478,054.02
- 60 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
31. Share capital
Unit: RMB
Changes for the period
New issue of Capitalisation of
Opening balance share Bonus issue surplus reserve Others Subtotal Closing balance
2017:
I. Restricted tradable shares
1. State-owned shares - - - - - - -
2. State-owned legal person
- - - - - - -
shares
3. Other domestic shares 305,100.00 - - - 53,825.00 53,825.00 358,925.00
4. Other foreign shares - - - - - - -
Total restricted tradable shares 305,100.00 - - - 53,825.00 53,825.00 358,925.00
II. Non-restricted tradable shares
1. Ordinary shares denominated
464,866,050.00 - - - (562.00) (562.00) 464,865,488.00
in RMB
2. Foreign capital shares listed
179,592,580.00 - - - (53,263.00) (53,263.00) 179,539,317.00
domestically
3. Foreign capital shares listed
- - - - - - -
overseas
4. Others - - - - - - -
Total non-restricted tradable
644,458,630.00 - - - (53,825.00) (53,825.00) 644,404,805.00
shares
III. Total shares 644,763,730.00 - - - - - 644,763,730.00
2016:
I. Restricted tradable shares
1. State-owned shares - - - - - - -
2. State-owned legal person
- - - - - - -
shares
3. Other domestic shares 431,094.00 - - - (125,994.00) (125,994.00) 305,100.00
4. Other foreign shares - - - - - - -
Total restricted tradable shares 431,094.00 - - - (125,994.00) (125,994.00) 305,100.00
II. Non-restricted tradable shares
1. Ordinary shares denominated
464,866,999.00 - - - (949.00) (949.00) 464,866,050.00
in RMB
2. Foreign capital shares listed
179,465,637.00 - - - 126,943.00 126,943.00 179,592,580.00
domestically
3. Foreign capital shares listed
- - - - - - -
overseas
4. Others - - - - - - -
Total non-restricted tradable
644,332,636.00 - - - 125,994.00 125,994.00 644,458,630.00
shares
III. Total shares 644,763,730.00 - - - - - 644,763,730.00
- 61 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
32. Capital reserve
Unit: RMB
Items Opening balance Increase Decrease Closing balance
2017:
Capital premium 163,560,083.00 - - 163,560,083.00
Including: Capital contributed by investors 163,560,083.00 - - 163,560,083.00
Exercised conversion option of convertible corporate
bonds
- - - -
Debt converted into capital - - - -
Differences arising from business combination involving
enterprises under common control
- - - -
Equity acquisition from minority shareholders
of subsidiaries
- - - -
Capital reserve converted into capital - - - -
Other capital reserve 3,920,298.25 - - 3,920,298.25
Including: Equity split from convertible corporate bonds - - - -
Fair value of equity-settled share-based equity instrument - - - -
Surplus of compensation granted by government for
relocation in the public interests
- - - -
Transfer from capital reserve under the
previous accounting system
(2,781,133.00) - - (2,781,133.00)
Others 6,701,431.25 - - 6,701,431.25
Total 167,480,381.25 - - 167,480,381.25
2016:
Capital premium 163,560,083.00 - - 163,560,083.00
Including: Capital contributed by investors 163,560,083.00 - - 163,560,083.00
Excised conversion option of convertible corporate bonds - - - -
Debt converted into capital - - - -
Differences arising from business combination involving
enterprises under common control
- - - -
Equity acquisition from minority shareholders of
subsidiaries
- - - -
Capital reserve converted into capital - - - -
Other capital reserve 2,004,656.15 1,915,642.10 - 3,920,298.25
Including: Equity split from convertible corporate bonds - - - -
Fair value of equity-settled share-based equity instrument - - - -
Surplus of compensation granted by government for
relocation in the public interests
- - - -
Transfer from capital reserve under the previous
accounting system
(2,781,133.00) - - (2,781,133.00)
Others 4,785,789.15 1,915,642.10(note) - 6,701,431.25
Total 165,564,739.15 1,915,642.10 - 167,480,381.25
Note：This is the capital reserve recoginized on pro rata basis of ownership interest held by the
Group due to the changes of other equity of the associate of the Group, China Merchant
Bonded Logistics.
- 62 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
33. Other comprehensive income
Unit: RMB
Amount incurred in current year
Less: Amount
included in other Post-tax
comprehensive amount Post-tax
Amount income in the prior attributable to amount
before income periods that is shareholders attributable
tax incurred in transferred to profit Less: income of the to minority
Item Opening balance current year or loss for the period tax expenses Company holders Closing balance
2017
I. Other comprehensive income that will not be
- - - - - - -
reclassified subsequently to profit or loss
Including: Change as a result of remeasurement of
- - - - - - -
the net defined benefit plan liability or asset
Share of other comprehensive income of the
investee under the equity method that will not be - - - - - - -
reclassified to profit or loss
II. Other comprehensive income that will be
(8,039,646.43) 1,250,000.00 - 312,500.00 937,500.00 - (7,102,146.43)
reclassified subsequently to profit or loss
Including: Share of other comprehensive income
of the investee under the equity method that will 100,000.00 - - - - - 100,000.00
be reclassified to profit or loss
Gains or losses on changes in fair value of
5,572,500.00 1,250,000.00 - 312,500.00 937,500.00 - 6,510,000.00
available-for-sale financial assets
Gains or losses on reclassification of held-to-
maturity investments to available-for-sale - - - - - - -
financial assets
Effective portion of gains or losses on
- - - - - - -
cash flow hedges
Translation differences of financial statements
(13,712,146.43) - - - - - (13,712,146.43)
denominated in foreign currencies
Total (8,039,646.43) 1,250,000.00 - 312,500.00 937,500.00 - (7,102,146.43)
2016
I. Other comprehensive income that will not be
- - - - - - -
reclassified subsequently to profit or loss
Including: Change as a result of remeasurement of
- - - - - - -
the net defined benefit plan liability or asset
Share of other comprehensive income of the
investee under the equity method that will not - - - - - - -
be reclassified to profit or loss
II. Other comprehensive income that will be
(7,889,646.43) (200,000.00) - (50,000.00) (150,000.00) - (8,039,646.43)
reclassified subsequently to profit or loss
Including: Share of other comprehensive income
of the investee under the equity method that will 100,000.00 - - - - - 100,000.00
be reclassified to profit or loss
Gains or losses on changes in fair value of
5,722,500.00 (200,000.00) - (50,000.00) (150,000.00) - 5,572,500.00
available-for-sale financial assets
Gains or losses on reclassification of held-to-
maturity investments to available-for-sale - - - - - - -
financial assets
Effective portion of gains or losses on
- - - - - - -
cash flow hedges
Translation differences of financial statements
(13,712,146.43) - - - - - (13,712,146.43)
denominated in foreign currencies
Total (7,889,646.43) (200,000.00) - (50,000.00) (150,000.00) - (8,039,646.43)
34. Special reserve
Unit: RMB
Item Opening balance Increase Decrease Closing balance
2017:
Production safety fee 4,145,765.65 9,845,498.98 5,828,636.63 8,162,628.00
2016:
Production safety fee 3,719,755.58 19,844,261.39 19,418,251.32 4,145,765.65
- 63 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
35. Surplus reserve
Unit: RMB
Item Opening balance Increase Decrease Closing balance
2017:
Statutory surplus reserve 520,074,434.56 - - 520,074,434.56
2016:
Statutory surplus reserve 520,074,434.56 - - 520,074,434.56
Note: In accordance with the Company Law of the PRC and the Company's Articles of
Association, the Company should appropriate 10% of net profit for the year to the statutory
surplus reserve, and the Company can cease appropriation when the statutory surplus
reserve accumulates to more than 50% of the registered capital. The statutory surplus
reserve can be used to make up for the loss or increase the paid-in capital after approval.
36. Unappropriated profit
Unit: RMB
Proportion of
appropriation or
Item Amount allocation
2017:
Before adjustment: Unappropriated profit at the end of prior year 3,381,390,887.86
Adjustment: Total unappropriated profit at the beginning of year -
After adjustment: Unappropriated profit at the beginning of year 3,381,390,887.86
Add: Net profit attributable to shareholders
of the Company for the year 276,407,832.70
Less: Appropriation to statutory surplus reserve - Note1
Appropriation to discretionary surplus reserve -
Appropriation to general risk reserve -
Ordinary shares' dividends payable 319,802,810.08 Note2
Ordinary shares' dividends converted into share capital -
Unappropriated profit at the end of the year 3,337,995,910.48
2016:
Before adjustment: Unappropriated profit at the end of prior year 3,113,367,524.19
Adjustment: Total unappropriated profit at the beginning of year -
After adjustment: Unappropriated profit at the beginning of year 3,113,367,524.19
Add: Net profit attributable to shareholders
532,376,492.97
of the parent company for the year
Less: Appropriation to statutory surplus reserve -
Appropriation to discretionary surplus reserve -
Appropriation to general risk reserve -
Ordinary shares' dividends payable 264,353,129.30
Ordinary shares' dividends converted into share capital -
Unappropriated profit at the end of the year 3,381,390,887.86
Note 1: Appropriation to statutory surplus reserve
According to the Articles of Association, the Company is required to transfer 10% of its
net profit to the statutory surplus reserve. The Company can cease appropriation when the
statutory surplus reserve accumulated to more than 50% of the register capital.
- 64 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
36. Unappropriated profit - continued
Note 2: Cash dividends approved by shareholders' meeting during the year
Pursuant to the resolution of shareholders’ meeting on 5 June 2017, on the basis of
644,763,730 issued shares for the year ended 31 December 2016, dividends of RMB4.96
for every 10 shares were distributed to all shareholders, which amounted to RMB
319,802,810.08.
Note 3: Appropriation to surplus reserve made by subsidiaries
As of 30 Jun. 2017, the balance of the Group's unappropriated profit included
appropriation to surplus reserve made by subsidiaries amounting to RMB587,698,230.64
(31 December 2016: RMB587,698,230.64).
37. Operating income and operating costs
Unit: RMB
Jan.-Jun. 2017 Jan.-Jun. 2016
Item Income Cost Income Cost
Principal operating 912,048,648.43 535,264,027.24 892,403,001.57 490,985,319.24
Other operating 17,559,850.48 708,808.22 12,406,650.67 1,173,205.35
Total 929,608,498.91 535,972,835.46 904,809,652.24 492,158,524.59
38. Business taxes and levies
Unit: RMB
Item Jan.-Jun. 2017 Jan.-Jun. 2016
Business tax - 1,499,967.15
City construction and maintenance tax 770,184.01 861,254.66
Education surcharges 649,751.23 718,325.63
Others 1,509,581.95 88,394.97
Building taxes 2,170,251.83 -
Total 5,099,769.02 3,167,942.41
39. Administrative expenses
Unit: RMB
Item Jan.-Jun. 2017 Jan.-Jun. 2016
Employee benefits 53,881,018.25 60,212,414.71
Taxes 3,698.28 2,893,986.34
Depreciation expenses 1,578,761.13 1,436,738.38
Amortization of intangible assets 487,581.23 426,838.44
Others 16,373,672.29 16,977,890.84
Total 72,324,731.18 81,947,868.71
- 65 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
40. Financial expenses
Unit: RMB
Item Jan.-Jun. 2017 Jan.-Jun. 2016
Interest expense 8,737,219.20 21,509,775.01
Less: Capitalized interest expenses 1,107,689.13 -
Less: Interest income 4,186,596.08 3,395,655.74
Exchange differences 6,393,283.53 (4,428,671.94)
Less: Capitalized exchange differences - -
Others 316,171.30 568,167.02
Total 10,152,388.82 14,253,614.35
41. Impairment losses of assets
Unit: RMB
Item Jan.-Jun. 2017 Jan.-Jun. 2016
I. Bad debt losses (1,908,239.31) 288,044.16
II. Write-down of inventories - -
III. Impairment on available-for-sale financial assets - -
IV. Impairment on held-to-maturity investments - -
V. Impairment on long-term equity investments - -
VI. Impairment on investment properties - -
VII. Impairment on fixed assets - -
VIII. Impairment on construction materials - -
IX. Impairment on construction in progress - -
X. Impairment on bearer biological assets - -
XI. Impairment on oil and gas assets - -
XII. Impairment on intangible assets - -
XIII. Impairment on goodwill - -
XIV. Others - -
Total (1,908,239.31) 288,044.16
42. Investment income
(1) Details of investment income
Unit: RMB
Jan.-Jun. 2017 Jan.-Jun. 2016
Long-term equity investments income under equity method 60,092,957.45 63,008,068.56
Investment income on available-for-sale financial assets 9,417,000.00 6,292,187.85
Total 69,509,957.45 69,300,256.41
(2) Details of long-term equity investments income under equity method
Unit: RMB
Reasons for increases or
decreases in the current
Investee Jan.-Jun. 2017 Jan.-Jun. 2016 compared to the prior period
MPIL 23,193,786.97 16,389,086.06 Net profit of investee fluctuates.
China Overseas Harbor Affairs (Laizhou) Co.,Ltd 29,155,806.47 37,197,754.16 Net profit of investee fluctuates.
CMBL 5,476,000.01 7,747,007.96 Net profit of investee fluctuates.
China Merchants Holdings (international )
Information Technology Co.,Ltd
2,267,364.00 1,674,220.38 Net profit of investee fluctuates
Total 60,092,957.45 63,008,068.56
- 66 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENT - continued
43. Non-operating income
(1) Non-operating income
Unit: RMB
Amount recognized
as non-recurring
gain and loss in the
Item Jan.-Jun. 2017 Jan.-Jun. 2016 current period
Government grants 498,801.18 419,197.16 498,801.18
Gains on disposal of non-current assets 293,053.57 321,539.16 293,053.57
Including: Gains on disposal of fixed assets 293,053.57 140,891.16 293,053.57
Insurance compensation income - 1,421,480.12 -
Others 1,615,361.54 476,997.37 1,615,361.54
Total 2,407,216.29 2,639,213.81 2,407,216.29
(2) Government grants
Unit: RMB
Related to
assets/Related to
Item Jan.-Jun. 2017 Jan.-Jun. 2016 income
Local government subsidy for new-energy vehicles - 20,000.00 Related to income
Special funds for modern logistics project 83,478.24 83,478.24 Related to assets
Special funds for guiding the development of the
26,022.60 26,022.60 Related to assets
modern service sector
Reward for energy saving 100,000.02 - Related to assets
Special funds for energy saving and emission
180,000.00 280,000.02 Related to assets
reduction in transportation
Central government subsidy for low-carbon green
9,300.30 9,696.30 Related to assets
port project
Subsidy for electric buses 100,000.02 - Related to assets
Total 498,801.18 419,197.16
44. Non-operating expenses
Unit: RMB
Amount recognized as
non-recurring gain and
loss in the current
Item Jan.-Jun. 2017 Jan.-Jun. 2016 period
Total losses on disposal of non-current assets 741,487.52 497,708.60 741,487.52
Including: Losses on disposal of fixed assets 741,487.52 393,008.61 741,487.52
Donations contributed - - -
Amercement outlay - 862.00 -
Others 1,136.84 2,895.03 1,136.84
Total 742,624.36 501,465.63 742,624.36
- 67 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
45. Income tax expenses
Unit: RMB
Item Jan.-Jun. 2017 Jan.-Jun. 2016
Current tax expense 58,847,008.80 49,661,006.76
Deferred income tax 49,425.00 -
Total 58,896,433.80 49,661,006.76
Reconciliation of income tax expenses to the accounting profit is as follows:
Unit: RMB
Item Jan.-Jun. 2017 Jan.-Jun. 2016
Accounting profit 379,141,563.12 384,431,662.61
Income tax expenses calculated at 25% (the prior year: 25 %) 94,785,390.78 96,107,915.65
Effect of expenses that are not deductible for tax purposes 13,943.60 1,056,319.90
Effect of tax-free income (17,377,489.36) (17,325,064.10)
Effect of unrecognized deductible losses and deductible temporary
(2,173,730.24) (31,720.53)
differences for tax purposes
Effect of different tax rates of subsidiaries operating in other jurisdictions (253,656.69) (153,427.70)
Effect of tax preference policy (11,986,902.50) (31,303,251.96)
Withholding income tax (Note) 1,632,930.63 1,844,132.60
Effect of previous unrecognized deductible temporary differences
(5,744,052.41) (533,897.10)
of deferred income tax
Income tax expenses 58,896,433.80 49,661,006.76
Note: Withholding income tax was accrued at the rate of 5% or 10% for dividend payable to
Chiwan Wharf Holdings (H.K.) Limited, declared by those PRC subsidiaries of which
Chiwan Wharf Holdings (H.K.) Limited is a shareholder.
46. Other comprehensive income
Please refer to Note (V) 36.
47. Borrowing cost
Unit: RMB
Jan.-Jun. 2017 Jan.-Jun. 2016
Amount of borrowing Amount of borrowing
costs capitalized Capitalization costs capitalized Capitalization
Item during the year rate during the year rate
Construction in progress 1,107,689.13 4.35% - -
Sub-total of borrowing costs capitalized
during the year
1,107,689.13 - - -
Borrowing costs recognized in profit
or loss during the year
7,629,530.07 - 21,509,775.01 -
Total of borrowing costs during the year 8,737,219.20 - 21,509,775.01 -
- 68 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
48. Notes to items in the cash flow statement
(1) Other cash receipts relating to operating activities
Unit: RMB
Item Jan.-Jun. 2017 Jan.-Jun. 2016
Government grants 20,000.00 -
Tonggu sea-route expenses 14,469,500.00 -
Interest income 3,498,376.84 3,480,587.17
Insurance indemnity 143,442.01 589,702.77
Refunds of harbor construction fee 361,547.93 187,255.90
Others 11,805,226.45 1,520,900.83
Total 30,298,093.23 5,778,446.67
(2) Other cash payments relating to operating activities
Unit: RMB
Item Jan.-Jun. 2017 Jan.-Jun. 2016
Port expenses 1,840,742.84 3,110,545.07
Office expenses & utilities 1,813,506.04 3,452,774.73
Consulting & auditing 1,163,253.24 958,941.16
Entertainment 1,175,602.09 1,286,439.91
Verhicles 1,295,699.65 1,384,524.03
Property insurance 1,683,669.16 961,760.89
Travel & accommodation 604,205.21 990,291.95
River channel occupation fee - 14,469,500.00
Others 24,354,514.37 19,521,179.59
Total 33,931,192.60 46,135,957.33
(3) Other cash payments relating to financing activities
Unit: RMB
Item Jan.-Jun. 2017 Jan.-Jun. 2016
Debt issue costs 15,792.33 25,986.89
- 69 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
49. Supplementary information to the cash flow statement
(1) Supplementary information to the cash flow statement
Unit: RMB
Supplementary Jan.-Jun. 2017 Jan.-Jun. 2016
1. Reconciliation of net profit to cash flows from operating activities:
Net profit 320,245,129.32 334,770,655.85
Add: Provision for impairment losses of assets (1,908,239.31) 288,044.16
Depreciation of fixed assets 93,053,985.18 96,908,007.22
Depreciation and amortization of investment property 412,916.04 460,990.32
Amortization of intangible assets 18,735,921.56 19,233,130.89
Amortization of long-term prepaid expenses 1,039,391.70 1,045,225.04
Losses on disposal of fixed assets , intangible assets and other
448,433.95 176,169.44
long-term assets
Financial expenses 14,320,347.84 17,480,007.18
Losses (gains) arising from investments (69,509,957.45) (69,300,256.41)
Decrease(Increase) in deferred tax assets 49,425.00 -
Decrease(Increase) in inventories (3,155,094.07) (581,772.67)
Decrease(Increase) in operating receivables (42,492,788.96) (46,999,409.75)
Increase(Decrease) in operating payables 88,292,309.11 15,176,452.53
Net cash flows from operating activities 419,531,779.91 368,657,243.80
2. Significant investing and financing activities that do not involve
cash receipts and payments:
Conversion of debt into capital - -
Convertible bonds due within one year - -
Fixed assets acquired under finance leases - -
3. Net changes in cash and cash equivalents:
Closing balance of cash 593,542,501.41 405,872,026.99
Less: Opening balance of cash 426,036,702.87 683,138,123.66
Add: Closing balance of cash equivalents - -
Less: Opening balance of cash equivalents - -
Net increase(Decrease) in cash and cash equivalents 167,505,798.54 (277,266,096.67)
(2) Composition of cash and cash equivalents
Unit: RMB
Item Closing balance Opening balance
I. Cash 593,542,501.41 426,036,702.87
Including: Cash on hand 9,319.45 28,943.84
Bank deposits 579,572,897.61 425,934,063.55
Other monetary funds 13,960,284.35 73,695.48
II. Cash equivalents - -
III. Closing balance of cash and cash equivalents 593,542,501.41 426,036,702.87
50. Asset with restricted ownership or use right
The Group has no assets with restricted ownership or use right.
- 70 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
51. Foreign currency monetary items
Unit: RMB
Closing balance of original Exchange
Item currency rate Closing amount in RMB
Cash and bank balances 263,432,256.56
Including: HKD 22,724,192.12 0.8679 19,722,326.34
USD 35,975,131.41 6.7744 243,709,930.22
Interest Receivable 2,816,790.51
Including: USD 415,799.26 6.7744 2,816,790.51
Accounts Receivable (1,316,749.70)
Including: HKD 22,344,682.27 0.8679 19,392,949.74
USD (3,057,052.94) 6.7744 (20,709,699.44)
Other Receivables 599,710.86
Including: HKD 122,698.97 0.8679 106,490.44
Accounts Payable 72,806.51 6.7744 493,220.42
Including: HKD 3,104,958.40 0.8679 2,694,793.40
Other Payable (857,378.38)
Including: HKD (32,185.64) 0.8679 (27,933.92)
USD (122,438.07) 6.7744 (829,444.46)
(VI) CHANGES IN CONSOLIDATION SCOPE
There is no change in consolidation scope during the year.
- 71 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(VII) EQUITY IN OTHER ENTITIES
1. Interests in subsidiaries
(1) Composition of the Group
Unit: RMB
Registered Balance of other items Proportion of ownership Interest (%)
Capital(in ten Actual capital substantively constituting Indirect Proportion of
Principal place of Place of Nature of thousand Yuan unless contribution at the net investments in the Direct ownership ownership voting power Consolidated
Full name of the subsidiary business incorporation business otherwise stated) end of the period subsidiary interest interest (%) or not Approach of acquiring
Shenzhen Chiwan International Freight Logistics support Established through
Shenzhen, PRC Shenzhen, PRC 550.00 5,500,000.00 - 100.00 - 100.00 Y
Agency Company Limited services investment
Established through
Chiwan Wharf Holdings (H.K.) Limited Hong Kong SAR, PRC Hong Kong SAR, PRC Investment HKD 1,000,000.00 1,070,000.00 11,004,285.00 100.00 - 100.00 Y
investment
Dongguan Chiwan Wharf Logistics support Established through
Dongguan, PRC Dongguan, PRC 45,000.00 382,500,000.00 - 85.00 - 85.00 Y
Company Limited services investment
Dongguan Chiwan Terminal Logistics support Established through
Dongguan, PRC Dongguan, PRC 40,000.00 400,000,000.00 - 100.00 - 100.00 Y
Company Limited services investment
Established through
Hinwin Development Company Limited Hong Kong SAR, PRC Hong Kong SAR, PRC Investment HKD 10,000.00 6,278,500.00 94,014,181.00 100.00 - 100.00 Y
investment
Combination involving
Shenzhen Chiwan Harbor Container Logistics support
Shenzhen, PRC Shenzhen, PRC 28,820.00 250,920,000.00 - 100.00 - 100.00 Y enterprises under
Co., Ltd services
common control
Combination involving
Shenzhen Chiwan Transportation Logistics support
Shenzhen, PRC Shenzhen, PRC 1,500.00 7,000,000.00 - 100.00 - 100.00 Y enterprises under
Co., Ltd services
common control
Combination involving
Logistics support
Chiwan Container Terminal Co., Ltd Shenzhen, PRC Shenzhen, PRC USD 95,300,000.00 485,990,004.00 - 55.00 - 55.00 Y enterprises under
services
common control
Combination involving
Shenzhen Chiwan Shipping Logistics support
Shenzhen, PRC Shenzhen, PRC 2,400.00 24,000,000.00 - 100.00 - 100.00 Y enterprises under
Transportation Co., Ltd. services
common control
Combination involving
Logistics support
Chiwan Shipping (Hong Kong) Ltd. Hong Kong SAR, PRC Hong Kong SAR, PRC HKD 800,000.00 856,000.00 - 100.00 - 100.00 Y enterprises under
services
common control
- 72 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(VII) EQUITY IN OTHER ENTITIES - continued
1. Interests in subsidiaries- continued
(2) Material non-wholly-owned subsidiaries
Unit: RMB
Proportion of ownership Profit or loss attributable Payments for dividends
interest held by the to minority shareholders to minority shareholders Closing balance of
Name of the subsidiary minority shareholders at the end of the period in the current period minority interest
2017
Dongguan Chiwan Wharf Company Limited 15% 6,549,369.92 - 121,612,422.30
Chiwan Container Terminal Co., Ltd 45% 37,287,926.70 - 850,230,794.94
Total 43,837,296.62 - 971,843,217.24
2016
Dongguan Chiwan Wharf Company Limited 15% 8,269,117.04 - 115,005,875.45
Chiwan Container Terminal Co., Ltd 45% 129,204,093.71 95,677,829.00 812,172,308.08
Total 137,473,210.75 95,677,829.00 927,178,183.53
(3) Significant financial information of material non-wholly-owned subsidiaries
Unit: RMB
Closing balance Opening balance
Current Non-current Non-current
Name of the subsidiary Current assets Non-current assets Total assets liabilities liabilities Total liabilities Current assets Non-current assets Total assets Current liabilities liabilities Total liabilities
Dongguan Chiwan Wharf 66,924,257.63 1,045,030,059.16 1,111,954,316.79 290,999,718.48 24,441,054.54 315,440,773.02 27,675,293.15 1,027,159,564.62 1,054,834,857.77 277,814,404.40 24,550,555.38 302,364,959.78
Company Limited
Chiwan Container Terminal Co., Ltd 576,471,800.96 1,537,406,810.66 2,113,878,611.62 156,473,119.70 68,003,725.40 224,476,845.10 389,403,217.21 1,575,821,422.22 1,965,224,639.43 87,814,329.79 72,582,958.32 160,397,288.11
Unit: RMB
Jan.-Jun. 2017 Jan.-Jun. 2016
Cash flows from operating Cash flows from operating
Name of the subsidiary Operating income Net profit Total comprehensive income activities Operating income Net profit Total comprehensive income activities
Dongguan Chiwan Wharf 159,643,720.20 43,662,466.15 43,662,466.15 35,258,020.10 137,362,432.71 32,992,167.94 32,992,167.94 41,785,806.63
Company Limited
Chiwan Container Terminal Co., Ltd 326,262,590.52 82,862,059.33 82,862,059.33 190,279,725.34 374,877,558.79 140,636,274.86 140,636,274.86 164,272,446.41
(4) No entities are added to the scope of consolidation in the current year.
- 73 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(VII) EQUITY IN OTHER ENTITIES - continued
2. Interests in joint ventures and associates
(1) Material joint ventures or associates
Unit: RMB
Proportion of ownership Proportion of voting power in the Accounting method
Principal interests held by the Group (%) investee held by the Group (%) of investments in
place of Place of Nature of joint ventures and
Investee business incorporation business 30 Jun. 2017 31 Dec. 2016 30 Jun. 2017 31 Dec. 2016 associates
China Overseas Harbor Affairs Warehousing
Laizhou Laizhou 40.00 40.00 40.00 40.00 Equity method
(Laizhou) Co., Ltd and logistics
MPIL Shenzhen British Virgin Islands Investments 50.00 50.00 50.00 50.00 Equity method
(2) Financial information of material joint venture
Unit: RMB
China Overseas Harbor Affairs (Laizhou) Co., Ltd
30 Jun. 2017/ 31 Dec. 2016/
Jan.-Jun. 2017 Jan.-Jun. 2016
Current assets 400,211,214.81 472,412,233.11
Including: cash and cash equivalent 348,455,534.05 428,471,301.05
Non-current assets 1,573,625,586.20 1,746,234,554.37
Total assets 1,973,836,801.01 2,218,646,787.48
Current liabilities 241,883,098.17 60,897,644.03
Non-current liabilities - 172,396,000.00
Total liabilities 241,883,098.17 233,293,644.03
Minority interests 1,385,120.46 974,119.24
Total equity attributable to shareholders of
1,730,568,582.38 1,984,379,024.21
the parent company
Net assets calculated based on the proportion of
692,227,432.95 793,751,609.68
ownership interest
Adjustments
- Goodwill - -
- Unrealized Profits Resulting from Intragroup
- -
Transactions
- Others 77,750,005.32 1,229,696.54
Carrying amounts of equity investments in Joint Venture 769,977,438.27 794,981,306.22
Operating income 198,791,298.68 205,506,077.48
Financial expenses (2,636,003.23) (1,208,317.13)
Tax expenses 25,348,743.97 17,586,815.81
Net profit 72,846,811.50 93,016,705.73
Other comprehensive income - -
Total comprehensive income 72,846,811.50 93,016,705.73
Dividends received from joint ventures
54,159,674.42 36,132,189.03
in the current year
- 74 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(VII) EQUITY IN OTHER ENTITIES- continued
2. Interests in joint ventures and associates - continued
(3) Financial information of material associates
Unit: RMB
MPIL
30 Jun. 2017/ 31 Dec. 2016/
Jan.-Jun. 2017 Jan.-Jun. 2016
Current assets 274,983,620.28 216,977,210.88
Including: cash and cash equivalent 175,748,639.85 160,156,678.41
Non-current assets 1,416,682,757.04 1,274,297,269.88
Total assets 1,691,666,377.32 1,491,274,480.76
Current liabilities 304,628,043.03 299,257,041.62
Non-current liabilities 6,677,923.17 4,031,799.53
Total liabilities 311,305,966.20 303,288,841.15
Minority interests 552,230,300.95 452,668,593.90
Total equity attributable to shareholders of the parent company 828,130,110.18 735,317,045.71
Net assets calculated based on the proportion 414,065,055.10
367,658,522.86
of ownership interest
Adjustments
- Goodwill - -
- Unrealized Profits Resulting from
- -
Intragroup Transactions
- Others (82,610,638.19) (26,739,280.23)
Carrying amounts of equity investments in Joint Venture 331,454,416.91 340,919,242.63
Operating income 294,856,119.93 242,222,181.42
Financial expenses 3,533,766.50 8,015,452.44
Tax expenses 17,791,571.03 11,674,494.48
Net profit 84,676,438.72 53,437,416.76
Other comprehensive income -
Total comprehensive income 84,676,438.72 53,437,416.76
Dividends received from joint ventures in the current year 32,658,612.69 36,572,459.27
(4) Summarized financial information of immaterial associates
Unit: RMB
30 Jun. 2017/ 30 Jun. 2016/
Jan.-Jun. 2017 Jan.-Jun. 2016
Associates:
Total carrying amounts of investment 362,270,471.68 354,527,107.68
Aggregate of following items calculated based on
the proportion of ownership interest
- Net profit 7,743,364.01 9,421,228.34
- Other comprehensive income - -
- Total comprehensive income 7,743,364.01 9,421,228.34
(5) As at 30 Jun. 2017, the long-term equity investments of the Group were not subject to
restriction on disposal or remittance of return on investments.
- 75 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(VIII) FINANCIAL INSTRUMENTS AND RISK MANAGEMENT
The Group's major financial instruments include Cash and bank balances, available-for-sale
financial assets, borrowings, equity investments, account receivables, account payables, bond
payables etc. Details of these financial instruments are disclosed in Note (V). The risks associated
with these financial instruments and the policies on how to mitigate these risks are set out below.
Management manages and monitors these exposures to ensure the risks are monitored at a certain
level.
The Group adopts sensitivity analysis techniques to analyze how the entity's profit or loss and for
the period and shareholders' equity would have been affected by changes in the relevant risk
variables that were reasonably possible. As it is unlikely that risk variables will change in an
isolated manner, and the interdependence between risk variables will have significant effect on
the amount ultimately influenced by the changes in a single risk variable, the following items are
based on the assumption that each risk variable has changes on a stand-alone basis.
1. Risk management objectives and policies
The Group's risk management objectives are to achieve proper balance between risks and yield,
minimize the adverse impacts of risks on the Group's operation performance, and maximize the
benefits of the shareholders and other equity investors. Based on these risk management
objectives, the Group's basic risk management strategy is to identify and analyze the industry's
exposure to various risks, establish appropriate bottom line for risk tolerance, implement risk
management, and monitors these exposures to ensure the risks are monitored at a certain level.
1.1 Market risk
1.1.1 Currency risk
Currency risk is the risk that losses will occur because of changes in foreign exchange rates. The
Group's exposure to the currency risk is primarily associated with USD and HKD. Several of the
Group's subsidiaries have purchases and sales denominated in HKD while the Group's other
principal activities are denominated and settled in RMB. As at 30 Jun. 2017, the balance of the
Group's assets and liabilities are both denominated in functional currency, except that balance of
assets set out below is in HKD and USD. Currency risk arising from the foreign currency balance
of assets and liabilities may have impact on the Group's performance.
Unit: RMB
Item Closing balance Opening balance
Cash and bank balances 263,432,256.56 200,776,163.48
- HKD 19,722,326.34 25,539,100.17
- USD 243,709,930.22 175,237,063.31
Accounts receivable (717,038.84) 26,594,259.65
- HKD 19,499,440.18 7,223,373.15
- USD (20,216,479.02) 19,370,886.50
Short-term borrowings - -
- HKD - -
Accounts payable 1,837,415.02 2,183,342.35
- HKD 2,666,859.48 2,519,094.88
- USD (829,444.46) (335,752.53)
- 76 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(VIII ) FINANCIAL INSTRUMENTS AND RISK MANAGEMENT - continued
1. Risk management objectives and policies - continued
1.1 Market risk - continued
1.1.1 Currency risk - continued
The Group closely monitors the effects of changes in the foreign exchange rates on the Group's
currency risk exposures, to minimize the company's currency risk. According to the current risk
exposure and judgment of the exchange rate movements, management considers the probable
heavy loss resulted from foreign exchange rate fluctuation to be fairly low.
Sensitivity analysis on currency risk
The assumption for the sensitivity analysis on currency risk is that all the cash flow hedges and
hedges of a net investment in a foreign operation are highly effective. On the basis of the above
assumption, where all other variables are held constant, the reasonably possible changes in the
foreign exchange rate may have the following pre-tax effect on the profit or loss for the period or
equity:
Unit: RMB
Jan.-Jun. 2017 Jan.-Jun. 2016
Effect on Effect on
Changes in Effect on shareholders' Effect on shareholders'
Item exchange rate profits equity profits equity
5% appreciation
All foreign currencies 13,043,890.14 13,043,890.14 8,645,464.36 8,645,464.36
against RMB
5% depreciation
All foreign currencies (13,043,890.14) (13,043,890.14) (8,645,464.36) (8,645,464.36)
against RMB
1.1.2 Interest rate risk - changes in cash flows
Risk derived from changes in cash flows of financial instruments is mainly related to bank loan
with floating interest rate. Details are disclosed in Note (V) 20. This Group takes the measure of
maintaining the floating interest rate of the bank loan, as a way to reduce the interest rate risk
arising from changes in fair value.
Sensitivity analysis of interest rate risk
Sensitivity analysis of interest rate risk is based on the following assumptions:
Fluctuations of market interest rate can affect the interest income or expense of a financial
instrument with floating interest rate.
For a financial instrument at fair value with fixed interest rate, the fluctuations of market
interest rate can only affect its interest income or expense.
For a derivative financial instrument recognized as hedging instrument, the fluctuations of
market interest rate affects its fair value and interest rate hedging estimation are effective
and efficient.
Market interest rate at the balance sheet date is adopted to calculate fair value changes of
derivative financial instruments and other financial assets and liabilities under discounted
cash flow method.
- 77 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(VIII) FINANCIAL INSTRUMENTS AND RISK MANAGEMENT - continued
1. Risk management objectives and policies - continued
1.1 Market risk - continued
1.1.3 Other price risk
Available-for-sale financial assets are measured at fair value by the Group at the balance sheet
date. Hence the Group takes risk of changes in the securities market. The Group closely monitors
the effects of changes in the foreign exchange prices on the Group's equity investment securities.
The Group has not taken any measures to reduce prices risk of equity investment securities.
1.2 Credit risk
As at 30 Jun. 2017, the Group's maximum exposure to credit risk which will cause a financial loss
to the Group due to failure to discharge an obligation by the counterparties and financial
guarantees issued by the Group is arising from the carrying amount of the respective recognized
financial assets as stated in the consolidated balance sheet. For financial instruments measured at
fair value, the carrying amount reflects the exposure to risks but not the maximum exposure to
risks; the maximum exposure to risks would vary according to the future changes in fair value.
In order to minimize the credit risk, the Group has delegated a team responsible for determination
of credit limits, credit approvals and other monitoring procedures to ensure that follow-up action
is taken to recover overdue debts. In addition, the Group reviews the recoverable amount of each
individual trade debt at each balance sheet date to ensure that adequate impairment losses are
made for irrecoverable amounts. In this regard, the management of the Group considers that the
Group's credit risk is significantly reduced.
The credit risk on liquid funds is limited because the counterparties are banks with high credit
ratings.
The Company adopted necessary policies to make sure that all clients and customers are attributed
with merit credit records.
- 78 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(VIII) FINANCIAL INSTRUMENTS AND RISK MANAGEMENT - continued
1. Risk management objectives and policies - continued
1.3 Liquidity risk
In the management of the liquidity risk, the Group monitors and maintains a level of cash and
cash equivalents deemed adequate by the management to finance the Group's operations and
mitigate the effects of fluctuations in cash flows. The management monitors the utilization of
bank borrowings and ensures compliance with loan covenants.
The following is the maturity analysis for financial assets and financial liabilities held by the
Group which is based on undiscounted remaining contractual obligations:
Unit: RMB
More than 5
Item Carrying amount Total amount Within one year 1-5 years
years
The non-derivative financial assets
Cash and bank balances 593,542,501.41 593,542,501.41 593,542,501.41 - -
Accounts receivable 243,504,003.91 243,504,003.91 243,504,003.91 - -
Interest receivable 1,264,914.26 1,264,914.26 1,264,914.26
Other receivables 18,699,162.98 18,699,162.98 18,699,162.98 - -
Available-for-sale financial
23,709,200.00 23,709,200.00 23,709,200.00 - -
assets
The non-derivative financial liabilities
Accounts payable 98,590,197.10 98,590,197.10 98,590,197.10 - -
Interest payable 6,371,260.30 6,371,260.30 6,371,260.30 - -
Dividends payable 319,802,810.47 319,802,810.47 319,802,810.47 - -
Other payable 75,105,519.60 75,105,519.60 75,105,519.60 - -
Bonds payable 298,629,041.09 298,629,041.09 - 298,629,041.09 -
(IX) FAIR VALUE
1. Closing balance of assets and liabilities measured at fair value
Unit: RMB
Closing Balance
Item Level 1 Level 2 Level 3 Total
Measurements at fair value continuously
Available-for-sale financial assets: 9,800,000.00 - - 9,800,000.00
- Equity instruments (Note) 9,800,000.00 - - 9,800,000.00
Total assets measured at fair value continuously 9,800,000.00 - - 9,800,000.00
Note: The available-for-sale financial assets held by the Company represent the fair value of the
circulating shares of Jiang Su Ninghu Expressway Company Ltd at the end of the year.
- 79 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(IX) FAIR VALUE - continued
2. Basis for determining the market price measured at fair value at level I continuously
The market price of assets and liabilities measured at fair value at level I continuously is
determined by the Shanghai stock exchange closing price of equity instruments at 30 Jun. 2017.
3. Information of financial assets and financial liabilities that are not measured at fair value
The management considers that the carrying amount of financial assets and liabilities measured at
amortized cost is approximately equal to the fair value of financial assets and liabilities.
(X) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS
1. Parent of the Company
Unit: RMB
Proportion of the
entity's ownership Proportion of the entity's
Related party Type of the Place of Legal Nature of interests held by the voting power held by the
Name of the parent relationship entity incorporation representative business Issued share capital parent (%) parent (%)
Listed in Hong
CMHI Parent company Hong Kong Li Xiao Peng Port shipping HKD34,766,421,285 - 66.10(Note)
Kong
Note: CMHI obtained 8.58% equity of the Company via its subsidiary Jing Feng Company, 25%
equity via its subsidiaries Shenzhen Malai Warehouse Co., Ltd., and obtained another
32.52% equity by entrustment of Nanshan Group's stock, totally holding 66.10% of the
voting shares, so CMHI is the parent company of the Company.
2. Subsidiaries of the Company
The general background and other related information of the subsidiaries are set out in Note (VII)
1.
3. Associates and joint ventures of the Company
The general background and other related information of the associates and joint ventures are set
out in Note (VII) 2.
- 80 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(X) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
4. Other related parties of the Company
Relationships between other related
Name of other related parties parties and the Company
Shenzhen Haiqin Engineering Management Co., Ltd. (Haiqin Engineering) Controlled by the same parent company
SMT Controlled by the same parent company
SMP Controlled by the same parent company
China Merchants Port Services (Shenzhen) Co., Ltd ("CMPS") Controlled by the same parent company
Shekou Container Terminals Limited ("SCT") Controlled by the same parent company
Shenzhen Haixing Harbor Development Co.,Ltd("Haixing") Controlled by the same parent company
Shenzhen Huxing Tug Service Co., Ltd.("Huxing Tug") Controlled by the same parent company
Shenzhen Lianda Tug Service Co., Ltd.("Lianda Tug") Controlled by the same parent company
Malai Warehouse Controlled by the same parent company
China Merchants Container Services Ltd.("China Merchants Container") Controlled by the same parent company
SMW Controlled by the same parent company
Hidoney Controlled by the same parent company
Shenzhen China Merchants Qianhaiwan Property Co., Ltd. ("Qianhai Property") Controlled by the same parent company
China Merchants International Cold Chain (Shenzhen) Co., Ltd ("CMCCL") Controlled by the same ultimate actual controller
Ocean Shipping Agency Controlled by the same ultimate actual controller
Shenzhen China Merchants Shangzhi Investment Co., Ltd.("China Merchants Shangzhi ") Controlled by the same ultimate actual controller
Shenzhen China Merchants International Shipping Agency Co., Ltd.("Shipping Agency") Controlled by the same ultimate actual controller
Youlian Shipyard (Shekou) Co. Ltd.("Youlian Shipyard") Controlled by the same ultimate actual controller
Shenzhen China Merchants Property Management Co., Ltd.("China Merchants Property") Controlled by the same ultimate actual controller
Guangzhou International Ocean Shipping Agency Co., Ltd. ("International Ocean Controlled by the same ultimate actual controller
Shipping")
China Ocean Shipping Tally Shenzhen Co., Ltd. ("Ocean Shipping Tally") Controlled by the same ultimate actual controller
China Merchants Houlder Insurance Co., Ltd. ("Houlder Insurance") Controlled by the same ultimate actual controller
Hoi Tung (Shanghai) Co., Ltd. Controlled by the same ultimate actual controller
Hoi Tung (Shenzhen) Co., Ltd. Controlled by the same ultimate actual controller
Sheanzhen South China Liquefied Gas Marine Co., Ltd.(South China Liquefied Gas) Controlled by the same ultimate actual controller
China Marine Shipping Agency, Shenzhen Co., Ltd. ("CMSA") (Note) Controlled by the same ultimate actual controller
Sinoway Shipping Ltd. ("Sinoway") (Note) Controlled by the same ultimate actual controller
China Merchants Heavy Industry Shenzhen Co., Ltd. ("CMHI") Controlled by the same ultimate actual controller
Shenzhen Chiwan Petroleum Supply Base Co., Ltd.("Chiwan Base ") Influenced significantly by parent company
Zengcheng Xinkang property Co., Ltd.("Zengcheng Xinkang") Influenced significantly by parent company
Shenzhen Baowan international logistics Co., Ltd.("Baowan Logistics") Influenced significantly by parent company
Shenzhen Chiwan Property Management Co., Ltd.("Chiwan Property") Influenced significantly by parent company
Shenzhen Xuqin Industrial Development Co., Ltd.(“Xuqin”) Influenced significantly by parent company
Shenzhen Chiwan Oriental Logistics Co., Ltd.("Chiwan Oriental Logistics") Influenced significantly by parent company
CDFC Influenced significantly by parent company
Invetsor that has significant influence on the
Nanshan Group
company
Influenced significantly by the ultimate actual
China Merchant Bank Co., Ltd.("CMB")
controller
Note: On 28 December 2015, State-owned Assets Supervision and Administration
Commission("SASAC") released an approval to transfer Sinotrans&CSC Holdings Co.,
Ltd.("Sinotrans & CSC"), as a whole, into China Merchants Group Co., Ltd .("CMG") for
free. On 24 Februrary 2016, SASAC confirmed that CMG is the controller shareholder of
Sinotrans & CSC. Therefore, the Company included the subsidiaries of Sinotrans& SCS,
CMSA and Sinoway as its related parties since 24 February 2016.
- 81 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(X) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
5. Related party transactions
(1) Provision and receipt of services
Unit: RMB
Pricing and decision-
Content of related party making procedures of
Related parties transaction related party transactions Jan.-Jun. 2017 Jan.-Jun. 2016
Receipt of services :
Haixing Load and unload service Negotiation 1,700,226.46 2,050,908.52
Sinotrans Shenzhen Marine Shipping Agency Co., Ltd. (“SSMSA”) Technical service fee Negotiation 1,976,679.00 1,747,860.00
China Merchants Holdings (International) Information Technology Company Ltd Technical service fee Negotiation 1,074,056.62 1,138,679.23
Property management
Chiwan Property Negotiation 1,022,057.59 925,553.89
service
SMT Load and unload service Negotiation 748,800.00 556,560.00
Property management
Zengcheng Xinkang Negotiation 159,666.73 393,625.32
service
Xuqin Landscape Engineering Negotiation 422,920.75 311,998.48
SMW Load and unload service Negotiation 1,159,412.08 250,330.19
CMBL Load and unload service Negotiation 1,003,449.45 243,745.29
Ocean Shipping Agency Agency service Negotiation 250,650.00 243,675.00
Lianda Tug Tugboat service Negotiation 203,305.19 163,684.43
Sinotrans Dongguan Logistics Co., Ltd. (“SDL”) logistics service Negotiation - 163,633.97
Haiqin Engineering Project management Negotiation 1,694,536.21 138,578.13
Property management
China Merchants Property Negotiation 1,153,153.32 125,089.30
service
SMP Load and unload service Negotiation 63,533.89 97,000.75
SCT Trailer service etc. Negotiation 2,273,719.92 69,056.60
Total 14,906,167.21 8,619,979.10
Rendering of services:
SCT Trailer service etc. Negotiation 7,339,564.71 7,206,689.95
Ocean Shipping Agency Tugboat service Negotiation 7,224,052.83 5,885,342.17
SMT Trailer service etc. Negotiation 8,728,097.72 5,873,774.53
SMP Tugboat service Negotiation 2,910,447.25 3,490,884.45
Sinotrans Shenzhen Marine Shipping Agency Co., Ltd. (“SSMSA”) Trailer service etc Negotiation 1,697,221.51 1,981,700.67
Shipping Agency Trailer service etc. Negotiation 1,537,334.91 1,283,371.50
China Overseas Harbour Affairs (Laizhou) Co., Ltd Labor dispatch service Negotiation - 736,553.60
International Ocean Shipping Berthage fee Negotiation 455,734.78 417,729.46
Lianda Tug Tugboat service Negotiation 280,898.54 268,439.64
Youlian Shipyard Tugboat service Negotiation 228,868.87 121,635.85
CMCCL Trailer service Negotiation - 118,620.75
CMBL Trailer service Negotiation - 39,004.71
Ocean Shipping Tally Others Negotiation - 32,233.58
Sinoway Shipping Ltd. (“Sinoway Shipping”) Load and unload service Negotiation 35,252.88 31,055.44
China Marine Shipping Agency Guangdong Co., Ltd. (“CMSA Guangdong”) Load and unload service Negotiation - 28,296.23
Zengcheng Xinkang Others Negotiation 1,820.31 2,701.97
COFCO & CM (Shenzhen) Grain Electronic Trading Center Load and unload service Negotiation 627,197.62 -
China Merchants Heavy Industry Shenzhen Co., Ltd. ("CMHI") Tugboat service Negotiation 16,796.23 -
Sinotrans Shenzhen Logistics Co., Ltd. Others Negotiation 10,787.74 -
Sinotrans Shenzhen Customs Broker Co., Ltd Others Negotiation 7,287.74 -
Total 31,101,363.64 27,518,034.50
- 82 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(X) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
5. Related party transactions - continued
(2) Leases with related parties
The Group as the lessor:
Unit: RMB
Lease income Lease income
recognised in the recognised in the
Name of lessee Type of leased assets current year previous year
CMBL Crane 932,038.83 932,038.86
Total 932,038.83 932,038.86
The Group as the lessee:
Unit: RMB
Lease payment
Lease payment recognised in
recognised in the previous
Name of lessor Type of leased assets the current year year
Nanshan Group Land, Office and packing yard 35,087,942.41 32,410,191.19
Malai Warehouse Office 4,960,034.15 4,642,399.87
Chiwan Base Office 772,310.94 2,706,819.39
CMPS Former Bay port lands 1,634,130.06 1,584,900.00
China Merchants Shangzhi Buildings 725,718.42 377,448.18
Qianhai Property Staff dormitory - 108,696.18
Baowan Logistics Warehouse 54,182.99 42,400.76
SCT Crane - 401,285.71
SMW Warehouse 384,863.11 -
Total 43,619,182.08 42,274,141.28
(3) Transfers of assets involved with related parties
Unit: RMB
related party Related trade Jan.-Jun. 2017 Jan.-Jun. 2016
Transfer-out of empty forklifts and
SMW - 129,227.69
computers
(4) Compensation for key management personnel
Unit: RMB
Item Jan.-Jun. 2017 Jan.-Jun. 2016
Compensation for key management personnel 4,641,702.52 4,504,067.50
- 83 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(X) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
6. Amounts due from/to related parties
Unit: RMB
Item Related parties Closing balance Opening balance
Cash and bank CMB 227,204,466.31 244,449,550.95
China Development Finance Company LTD. 205,769.88 1,211,887.57
Total 227,410,236.19 245,661,438.52
Accounts receivable SCT 1,433,780.90 29,340.00
Ocean Shipping Agency 3,387,002.00 2,138,014.00
SMT 2,156,746.56 1,097,931.17
SSMSA 388,366.40 568,815.80
SMP 597,218.76 278,192.54
Shipping Agency 582,697.00 390,704.00
Sinoway 19,085.00 24,588.00
CMBL 11,160.00 -
International Ocean Shipping 53,902.00 -
Total 8,629,958.62 4,527,585.51
Other receivables SMP 282,027.61 1,366,290.52
SMT 669,136.63 870,864.34
CMBL 2,180,743.58 2,437,813.73
Nanshan Group 3,175,200.09 1,054,300.09
SCT 278,748.50 16,994.00
Qianhai Property 704,172.00 654,480.00
Xuqin 3,000.00 323,000.00
China Merchants Shangzhi 176,299.20 176,299.20
Chiwan Base 135,621.91 135,621.91
China Merchants Property - 5,294.00
COLOMBO International Container 129,070.78 -
Others 62,809.00 62,809.00
Total 7,796,829.30 7,103,766.79
Accounts payable Nanshan Group 14,629,308.23 10,090,213.25
Haixing 515,946.00 575,625.00
SSMSA 892,138.71 743,962.71
Xuqin 702,412.35 793,251.50
SCT 401,415.00 -
China Merchants Holdings Company Ltd 99,675.65 99,675.65
China Merchants Holdings (International)
29,000.00 -
Information Technology Company Ltd.
Zengcheng Xinkang - 207,845.50
CMPS 839,997.00 -
Hoi Tung (Shanghai) Company Limited - 188,945.00
Chiwan Base 139,400.00 -
Total 18,249,292.94 12,699,518.61
Dividends payable Nanshan Group 104,004,785.23 -
Malai Warehouse 79,950,702.77 -
Total 183,955,488.00 -
- 84 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(X) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
6. Amounts due from/to related parties - continued
Unit: RMB
Item Related parties Closing balance Opening balance
Other payables SMT 2,109,987.55 5,173,198.89
SMP 1,325,496.73 647,066.08
China Merchants Holdings (International)
815,800.00 42,900.00
Information Technology Company Ltd.
CMPS 839,997.00 -
Chiwan Base 689,477.50 -
China Merchants Shangzhi 1,057,795.20 117,532.80
Nanshan Group 193,487.63 155,593.03
SCT 133,980.95 247,360.66
Haiqin Engineering 742,184.61 389,509.73
Chiwan Property 62,264.92 14,100.90
China Merchants Group 8,570.12 -
China Merchants Property - 3,626.34
Xuqin 67,426.00 51,624.65
International Ocean Shipping 10,000.00 10,000.00
Qianhai Property 327,240.00 -
Total 6,854,233.71 6,852,513.08
(XI) COMMITMENTS AND CONTINGENCIES
1. Significant commitments
(1) Capital commitments
Unit: RMB
Item Closing balance Opening balance
Capital commitments that have been entered into but have not
been recognised in the financial statements:
- Commitment for acquisition of long-term assets 110,517,815.86 151,991,708.93
-Commitment for foreign investment 56,136,194.00 56,136,194.00
Total 166,654,009.86 208,127,902.93
(2) Operating lease commitments
As of the balance sheet date, the Group had the following commitments in respect of non-
cancellable operating leases:
Unit: RMB
Item Closing balance Opening balance
Minimum lease payments under non-cancellable
operating leases:
1st year subsequent to the balance sheet date 60,436,842.46 58,325,261.82
2nd year subsequent to the balance sheet date 28,923,889.60 54,599,108.85
3rd year subsequent to the balance sheet date 386,662.62 656,227.25
More than 3 years 323,171.29 -
Total 90,070,565.96 113,580,597.92
2. Contingencies
No material contingencies that should be disclosed by the Group.
- 85 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(XII) EVENTS AFTER THE BALANCE SHEET
1. Profit appropriation
Unit: RMB
Item Amount
Proposed distribution of profits or dividends (Note) 319,802,810.08
Note: Please refer to Note (V) 39.
(XIII) OTHER SIGNIFICANT EVENTS
1. Annuity plan
On 3 June 2008, the Group participated in the enterprise annuity plan of Nanshan Group approved
by Shenzhen government. Funds involved were deposited in the managed account coordinated by
Nanshan Group. Staffs would be qualified to participant the annuity plan if the following
requirements are met:
(i)Staff with labor contracts signed. (ii)Staff with basic pension participated in.
(iii)On-the job and in-service staff with probation expired. (iv)Voluntarily participated in the plan
and perform the obligation of payment. The Group and staffs share the payment of the
supplementary pension. Excess payment would not be allowed so as to keep the payment made by
the Group and total payment made by the Group and the individual under the limit of one-twelfth
and the one-sixth of the prior year's gross payroll respectively.
2. Segment reporting
(1) Basis for determining and accounting treatments of reporting segments
Subject to the Group's in-house infrastructure, management requirements and internal reporting
system, the operation businesses of the Group are classified into four business segments. The
Group's management periodically evaluates the operating results of these segments to make
decisions about resources to be allocated to the segments and assess their performance. On the
basis of such business segments, the Group determined three reporting segments including load
and unload services, trailer and tugboat business, agency services and other segments, which are
classified based on the nature of business. Major products and services delivered or provided by
each of the reporting segments are load and unload services, trailer and tugboat business, agency
services and other segments.
Segment information is disclosed in accordance with the accounting policies and measurement
standards adopted by each segment when reporting to management. The measurement basis is
consistent with the accounting and measurement basis in the preparation of the financial
statements.
- 86 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(XIII) OTHER SIGNIFICANT EVENTS - continued
2. Segment reporting - continued
(2) Segment financial information
Unit: RMB
Load and unload services Trailer and tugboat business Agency and other services Unappropriated items Inter-segment deduction Total
Jan.-Jun. 2017 Jan.-Jun. 2016 Jan.-Jun. 2017 Jan.-Jun. 2016 Jan.-Jun. 2017 Jan.-Jun. 2016 Jan.-Jun. 2017 Jan.-Jun. 2016 Jan.-Jun. 2017 Jan.-Jun. 2016 Jan.-Jun. 2017 Jan.-Jun. 2016
Operating income
Revenue arising from external
865,384,374.34 844,465,634.31 49,878,666.71 46,615,750.31 14,345,457.86 13,728,267.62 - - - - 929,608,498.91 904,809,652.24
transactions
Revenue arising from inter-segment
- - 33,158,187.84 30,707,142.71 - - - - (33,158,187.84) (30,707,142.71) - -
transactions
Total segment operating income 865,384,374.34 844,465,634.31 83,036,854.55 77,322,893.02 14,345,457.86 13,728,267.62 - - (33,158,187.84) (30,707,142.71) 929,608,498.91 904,809,652.24
Reconciling items:
Operating Income in the financial statements 929,608,498.91 904,809,652.24
Operating cost 497,194,719.83 458,877,279.34 61,369,223.59 56,538,338.80 10,551,079.86 7,450,049.16 - - (33,142,187.82) (30,707,142.71) 535,972,835.46 492,158,524.59
Segment operating profits 368,189,654.51 385,588,354.97 21,667,630.96 20,784,554.22 3,794,378.00 6,278,218.46 - - (16,000.02) - 393,635,663.45 412,651,127.65
Reconciling items:
Business taxes and surcharges 4,261,580.04 2,081,550.23 108,304.02 125,688.62 9,377.58 685,817.25 - - 720,507.38 274,886.31 5,099,769.02 3,167,942.41
Administrative expenses 52,148,830.54 57,605,219.02 5,921,650.84 6,952,748.64 2,375,212.07 3,001,025.95 11,879,037.73 14,388,875.10 - - 72,324,731.18 81,947,868.71
Financial expenses 9,957,541.29 6,084,491.80 (762,020.47) (760,243.01) 198,656.84 (561,181.41) 758,211.16 9,490,546.97 - - 10,152,388.82 14,253,614.35
Impairment losses of assets (1,710,539.31) 288,044.16 (197,700.00) - - - - - - - (1,908,239.31) 288,044.16
Investment Income - - - - - - 302,202,787.63 301,993,086.59 (232,692,830.18) (232,692,830.18) 69,509,957.45 69,300,256.41
Operating profit 303,532,241.95 319,529,049.76 16,597,396.57 14,466,359.97 1,211,131.51 3,152,556.67 289,565,538.74 278,113,664.52 (233,429,337.58) (232,967,716.49) 377,476,971.19 382,293,914.43
Non-operating income 2,295,857.98 2,488,565.79 111,358.31 120,000.02 - 30,648.00 - - - - 2,407,216.29 2,639,213.81
Non-operating expenses 224,356.40 500,603.63 518,267.96 862.00 - - - - - - 742,624.36 501,465.63
Gross profit 305,603,743.53 321,517,011.92 16,190,486.92 14,585,497.99 1,211,131.51 3,183,204.67 289,565,538.74 278,113,664.52 (233,429,337.58) (232,967,716.49) 379,141,563.12 384,431,662.61
Income tax expenses 53,152,811.68 44,125,732.88 4,047,621.74 3,646,374.51 63,069.75 44,766.77 1,632,930.63 1,844,132.60 - - 58,896,433.80 49,661,006.76
Net profit 252,450,931.85 277,391,279.04 12,142,865.18 10,939,123.48 1,148,061.76 3,138,437.90 287,932,608.11 276,269,531.92 (233,429,337.58) (232,967,716.49) 320,245,129.32 334,770,655.85
- 87 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(XIII) OTHER SIGNIFICANT EVENTS - continued
2. Segment reporting - continued
(2) Segment financial information - continued
Unit: RMB
Load and unload services Trailer and tugboat business Agency and other services Unappropriated items Inter-segment deduction Total
Jan.-Jun.
Jan.-Jun. 2017 Jan.-Jun. 2016 Jan.-Jun. 2017 Jan.-Jun. 2016 2017 Jan.-Jun. 2016 Jan.-Jun. 2017 Jan.-Jun. 2016 Jan.-Jun. 2017 Jan.-Jun. 2016 Jan.-Jun. 2017 Jan.-Jun. 2016
Total segment assets 7,963,065,099.65 5,430,595,832.96 214,437,576.01 210,588,801.07 23,106,697.18 36,184,102.36 6,633,151,638.01 7,535,075,833.13 (8,049,339,462.32) (6,585,683,289.43) 6,784,421,548.53 6,626,761,280.09
Total assets in the financial
7,963,065,099.65 5,430,595,832.96 214,437,576.01 210,588,801.07 23,106,697.18 36,184,102.36 6,633,151,638.01 7,535,075,833.13 (8,049,339,462.32) (6,585,683,289.43) 6,784,421,548.53 6,626,761,280.09
statements
Total segment liabilities 2,334,819,894.52 1,470,340,168.48 116,970,014.74 114,510,739.19 12,669,458.57 26,199,615.99 170,616,779.95 1,764,787,576.27 (1,493,872,754.35) (2,052,120,486.34) 1,141,203,393.43 1,323,717,613.59
Total liabilities in the financial
2,334,819,894.52 1,470,340,168.48 116,970,014.74 114,510,739.19 12,669,458.57 26,199,615.99 170,616,779.95 1,764,787,576.27 (1,493,872,754.35) (2,052,120,486.34) 1,141,203,393.43 1,323,717,613.59
statements
Supplementary information
Depreciation 89,519,119.36 91,078,964.84 5,890,089.17 5,890,089.17 316,828.10 316,828.10 83,115.21 83,115.21 - - 95,809,151.84 97,368,997.32
Amortization 19,618,097.53 20,121,115.31 - 8,748.12 - - 157,175.70 142,659.36 - - 19,775,273.23 20,272,522.79
Interest income 14,654,057.22 1,173,650.03 212,306.96 210,552.90 6,467.63 403,115.28 21,265,871.78 (4,195,616.76) (31,952,107.51) 5,803,954.29 4,186,596.08 3,395,655.74
Interest expense 11,621,275.13 (5,924,339.39) - (65,254.86) - - 11,652,818.46 21,970,301.28 (13,429,185.26) 5,803,954.29 9,844,908.33 21,784,661.32
Investment income from
long-term equity investment - - - - - - - -
60,092,957.45 63,008,068.56 60,092,957.45 63,008,068.56
under equity method
Long-term equity investment
- - - - - - - -
under equity method 1,463,702,326.87 1,439,244,037.52 1,463,702,326.87 1,439,244,037.52
Non-current assets other than
long-term equity investment 4,311,287,038.27 4,303,834,271.18 117,493,640.22 120,159,617.69 84,470.81 16,188,638.70 307,839,267.10 180,875,139.97 (312,845,278.50) (162,765,586.89) 4,423,859,137.90 4,458,292,080.65
- 88 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(XIII) OTHER SIGNIFICANT EVENTS - continued
2. Segment reporting – continued
(3) Segment revenue from external transactions by source and non-current assets by geographical
location
Unit: RMB
Item Jan.-Jun. 2017 Jan.-Jun. 2016
Revenue from external transactions with domestic customers 917,481,142.33 903,301,572.23
Revenue from external transactions with Hong Kong customers 12,127,356.58 1,508,080.01
Total 929,608,498.91 904,809,652.24
Unit: RMB
Item Jan.-Jun. 2017 Jan.-Jun. 2016
Non-current assets sourced from Mainland of PRC 4,387,973,511.00 4,433,998,794.69
Non-current assets sourced from Hong Kong 4,093.43 6,850.61
Total 4,387,977,604.43 4,434,005,645.30
(4) Degree of reliance on major customers
The total operating income derived from the top five clients of the Group is RMB377,015,687.69 ,
occupying 40.56% of the Group's total operating income.
(XIV) NOTES TO THE KEY ITEMS IN THE COMPANY’S FINANCIAL STATEMENTS
1. Accounts receivable
(1) Disclosure of accounts receivable by categories
Unit: RMB
Closing balance Opening balance
Carrying amount balance Bad debt provision Carrying amount balance Bad debt provision
Proportion Proportion Proportion Proportion
Category Amount (%) Amount (%) Carrying value Amount (%) Amount (%) Carrying value
Accounts
receivable that are
individually
significant and for
- - - - - - - - - -
which bad debt
provision has
been assessed
individually
Accounts receivable for which bad debt provision has been assessed by credit risk portfolios
Portfolio 1 2,262,003.80 9.36 - - 2,262,003.80 63,999.00 0.43 - 63,999.00
-
Portfolio 2 21,899,519.44 90.64 - - 21,899,519.44 14,666,413.29 99.57 - - 14,666,413.29
Subtotal of
24,161,523.24 100.00 - - 24,161,523.24 14,730,412.29 100.00 - - 14,730,412.29
portfolios
Accounts
receivable that are
not individually
significant but for
- - - - - - - - - -
which bad debt
provision has
been assessed
individually
Total 24,161,523.24 100.00 - - 24,161,523.24 14,730,412.29 100.00 - - 14,730,412.29
- 89 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(XIV) NOTES TO THE KEY ITEMS IN THE COMPANY’S FINANCIAL STATEMENTS -
continued
1. Accounts receivable - continued
(1) Disclosure of accounts receivable by categories - continued
Accounts receivable portfolios for which bad debt provision has been assessed using the aging
analysis approach:
Unit: RMB
Closing balance Opening balance
Carrying Bad debt Proportion Carrying amount Bad debt Proportion
Aging amount balance provision (%) Carrying value balance provision (%) Carrying value
Within 1 year 21,899,519.44 - - 21,899,519.44 14,666,413.29 - - 14,666,413.29
(2) Top five balances of accounts receivable classified by debtor:
Unit: RMB
Proportion of
the closing
Relationship balance to the Closing balance
with the total accounts of bad debt
Name of entity Company Closing balance receivable (%) provision
Customer F Customer 7,358,127.15 30.45 -
Customer G Customer 6,188,829.45 25.61 -
Customer H Customer 2,763,000.00 11.44 -
Customer I Customer 2,000,000.00 8.28 -
Customer J Customer 1,512,486.82 6.26 -
Total 19,822,443.42 82.04 -
2. Other receivables
(1) Disclosure of other receivables by categories
Unit: RMB
Closing balance Opening balance
Carrying amount balance Bad debt provision Carrying amount balance Bad debt provision
Proportion Proporti Proportion Proportion
Category Amount (%) Amount on (%) BCarrying value Amount (%) Amount (%) BCarrying value
Other receivables that are
individually significant and for
which bad debt provision has been
- - - - - - - - - -
assessed individually
Other receivables for which bad debt provision has been assessed by credit risk portfolios
Portfolio 1 562,507,733.83 99.70 - - 562,507,733.83 581,387,532.80 99.75 - - 581,387,532.80
Portfolio 2 1,664,768.65 0.30 383,456.60 23.03 1,281,312.05 1,455,758.02 0.25 391,186.82 26.87 1,064,571.20
Subtotal of portfolios 564,172,502.48 100.00 383,456.60 0.07 563,789,045.88 582,843,290.82 100.00 391,186.82 0.07 582,452,104.00
Other receivables that are not
individually significant but for
- - - - - - - - - -
which bad debt provision has been
assessed individually
Total 564,172,502.48 100.00 383,456.60 0.07 563,789,045.88 582,843,290.82 100.00 391,186.82 0.07 582,452,104.00
- 90 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(XIV) NOTES TO THE KEY ITEMS IN THE COMPANY’S FINANCIAL STATEMENTS -
continued
2. Other receivables - continued
(1) Disclosure of other receivables by categories - continued
Other receivables portfolios for which bad debt provision has been assessed using the aging
analysis
Unit: RMB
Closing balance Opening balance
Carrying Bad debt Proportion Carrying Carrying Bad debt Proportion Carrying
Aging amount balance provision (%) value amount balance provision (%) value
Within 1 year 1,281,312.05 - - 1,281,312.05 1,034,396.62 149.26 0.01 1,034,247.36
More than 1 year but
- - - - 37,904.80 7,580.96 20.00 30,323.84
not exceeding 2 years
More than 2 years but
- - - - - - - -
not exceeding 3 years
More than 3 years 383,456.60 383,456.60 100.00 - 383,456.60 383,456.60 100.00 -
Total 1,664,768.65 383,456.60 23.03 1,281,312.05 1,455,758.02 391,186.82 26.87 1,064,571.20
(2) Disclosure of other receivables by nature
Unit: RMB
Item Closing balance Opening balance
Temporary payments 5,205,270.86 2,095,061.81
Deposits 479,634.90 306,791.32
Others 558,487,596.72 580,441,437.69
Including: amounts due from subsidiaries 552,166,847.60 580,057,981.09
Total 564,172,502.48 582,843,290.82
(3) Top five balances of other receivables classified by debtor:
Unit: RMB
Proportion of the
amount to the Closing balance
total accounts of bad debt
Name of entity Nature of the fund Amount Aging receivable (%) provision
Dongguan Chiwan Terminal Temporary payment due
305,375,000.00 Within one year 54.13 -
Company Limited. from subsidiaries
Dongguan Chiwan Wharf Temporary payment due
246,791,847.60 Within one year 43.74 -
Co., Ltd. from subsidiaries
Chiwan Wharf Holdings Temporary payment due More than three
2,850,941.50 0.51 -
(H.K.) Limited. from subsidiaries year
Temporary payment due
Nanshan Group 2,822,760.39 Within one year 0.50 -
from related parties
Temporary payment due
CCT 695,498.23 Within one year 0.12 -
from related parties
Total 558,536,047.72 99.00 -
- 91 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(XIV) NOTES TO THE KEY ITEMS IN THE COMPANY’S FINANCIAL STATEMENTS - continued
3. Long-term equity investments
Unit: RMB
Changes
Reconciling
items from Closing
other Cash dividends or balance of
Investment income under comprehensive Other equity profits announced Provision for provision for
Investee Opening balance Increase Decrease equity method income movements of issuance impairment Others Closing balance impairment
I. Subsidiaries
Shenzhen Chiwan International Freight
Not
Agency 5,500,000.00 - - Not applicable Not applicable Not applicable - - 5,500,000.00 -
applicable
Company Limited
Shenzhen Chiwan Harbor Container Not
250,920,000.00 - - Not applicable Not applicable Not applicable - - 250,920,000.00 -
Company Limited applicable
Shenzhen Chiwan Transportation Not
7,000,000.00 - - Not applicable Not applicable Not applicable - - 7,000,000.00 -
Company Limited applicable
Not
Chiwan Wharf Holdings (H.K.) Limited 1,070,000.00 - - Not applicable Not applicable Not applicable - - 1,070,000.00 -
applicable
Shenzhen Chiwan Tugboat Company Not
24,000,000.00 - - Not applicable Not applicable Not applicable - - 24,000,000.00 -
Limited applicable
Chiwan Container Terminal Company Not
421,023,199.85 - - Not applicable Not applicable Not applicable - - 421,023,199.85 -
Limited applicable
Not
Dongguan Chiwan Wharf Company Limited 186,525,000.00 - - Not applicable Not applicable Not applicable - - 186,525,000.00 -
applicable
Dongguan Chiwan Terminal Company Not
175,000,000.00 - - Not applicable Not applicable Not applicable - - 175,000,000.00 -
Limited applicable
Subtotal 1,071,038,199.85 - - - 1,071,038,199.85 -
II. Associates -
CMHI 14,595,240.92 2,267,364.00 - - 16,862,604.92 -
CMBL 151,985,444.98 2,738,000.00 - - 154,723,444.98 -
Subtotal 166,580,685.90 5,005,364.00 - - 171,586,049.90 -
III. Joint ventures
China Overseas Harbor Affairs (Laizhou)
794,981,306.22 29,155,806.47 - (54,159,674.42) 769,977,438.27 -
Co., Ltd
Total 2,032,600,191.97 34,161,170.47 - (54,159,674.42) 2,012,601,688.02 -
- 92 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(XIV) NOTES TO THE KEY ITEMS IN THE COMPANY’S FINANCIAL STATEMENTS -
continued
4. Operating income and operating costs
Unit: RMB
Jan.-Jun. 2017 Jan.-Jun. 2016
Item Income Cost Income Cost
Principal operating 103,342,484.62 61,542,231.02 90,048,025.87 64,585,052.56
Other operating 16,693,852.72 451,533.62 15,662,004.26 364,898.28
Total 120,036,337.34 61,993,764.64 105,710,030.13 64,949,950.84
5. Investment income
Details of investment income
Unit: RMB
Item Jan.-Jun. 2017 Jan.-Jun. 2016
Income from long-term equity investments under equity method 34,161,170.47 42,745,478.52
Investment income on available-for-sale financial assets, etc. 9,417,000.00 6,292,187.85
Total 43,578,170.47 49,037,666.37
- 93 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(XIV) NOTES TO THE KEY ITEMS IN THE COMPANY’S FINANCIAL STATEMENTS -
continued
6. Related party transactions
(1) Provision and receipt of services
Unit: RMB
Pricing and decision-
making procedures of
Content of related party related party
transaction transactions Jan.-Jun. 2017 Jan.-Jun. 2016
Receipt of services :
Chiwan Shipping (Hong Kong) Ltd Agency service Negotiation 461,799.81 940,321.59
Xuqin Landscape engineering Negotiation 416,694.34 179,068.96
Property management
Chiwan Property Negotiation 175,675.19 148,751.65
service
Haiqin Engineering Engineering Management Negotiation 145,848.28 138,578.13
China Merchants Holdings (International) Information
Technical service Negotiation 63,584.93 74,339.65
Technology Company Ltd
Shenzhen Chiwan Tugboat Company Limited Tugboat services Negotiation 12,166.04 13,766.04
Shenzhen Chiwan International Freight Agency
Agency service Negotiation 13,007.98 5,368.30
Company Limited
Haixing Load and unload service Negotiation 47,518.00 -
Total 1,336,294.57 1,500,194.32
Rendering of services:
Dongguan Chiwan Wharf Company Limited Labor dispatch service Negotiation 5,189,549.19 11,552,504.65
China Overseas Harbour Affairs (Laizhou) Co., Ltd Labor dispatch service Negotiation - 736,553.60
SSMSA Load and unload service Negotiation 24,659.43 125,799.71
Shipping Agency Berthage fee , etc, Negotiation - 76,144.33
Ocean Shipping Tally Load and unload service Negotiation - 32,233.58
Ocean Shipping Agency Load and unload service Negotiation - 18,736.79
Dongguan Chiwan Terminal Company Limited Labor dispatch service Negotiation 3,953,940.28 -
COFCO & CM (Shenzhen) Grain Electronic Trading Center Load and unload service Negotiation 627,197.62 -
Total 9,795,346.52 12,541,972.66
- 94 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(XIV) NOTES TO THE KEY ITEMS IN THE COMPANY’S FINANCIAL STATEMENTS -
continued
6. Related party transactions - continued
(2) Leases with related parties
The Group as the lessee:
Unit: RMB
Lease payment recognised in Lease payment recognised in
Name of lessor Type of leased assets the current year the previous year
Land, Office and packing
Nanshan Group 4,165,980.04 3,764,963.47
yard
Chiwan Base Office 772,310.94 786,661.42
Malai Warehouse Office 2,104,514.22 1,622,229.74
SCT Crane - 360,000.00
Total 7,042,805.20 6,533,854.63
7. Amounts due from/to related parties
Unit: RMB
Item Related parties Closing balance Opening balance
China Merchants Bank 25,771,062.09 19,265,421.23
Cash and bank
China Development Finance Co., Ltd. 205,769.88 1,211,887.57
balances
Total 25,976,831.97 20,477,308.80
Accounts SSMSA - 44,129.00
receivable
Shipping Agency - 19,870.00
Total - 63,999.00
Other receivables Dongguan Chiwan Terminal Company Limited 305,375,000.00 361,632,988.72
Dongguan Chiwan Wharf Company Limited 246,791,847.60 214,500,000.00
Chiwan Wharf Holdings (H.K.) Limited 2,850,941.50 2,851,360.05
Nanshan Group 2,823,660.39 1,022,760.39
Shenzhen Chiwan Tugboat Company Limited 94,268.78 -
Chiwan Base 135,621.91 135,621.91
China Merchants Shangzhi 58,766.40 58,766.40
Chiwan Container Terminal Company Limited 695,498.23 725,678.44
CHCC 296,575.90 309,683.43
Chiwan Property 150.00 150.00
Hiwin 38,270.45 38,270.45
Total 559,160,601.16 581,275,279.79
- 95 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(XIV) NOTES TO THE KEY ITEMS IN THE COMPANY’S FINANCIAL STATEMENTS -
continued
7. Amounts due from/to related parties - continued
Item Related parties Closing balance Opening balance
Long-term
Chiwan Wharf Holdings (H.K.) Limited 11,004,284.75 11,004,284.75
receivables
Accounts Nanshan Group 4,238,274.40 2,906,947.14
payable
Xuqin 702,412.35 785,059.00
Chiwan Shipping (Hong Kong) Ltd 354,680.93 -
Total 5,295,367.68 3,692,006.14
Other payables Shenzhen Chiwan Harbour Container Company Limited 127,229,139.72 243,733,114.96
Chiwan Container Terminal Company Limited 73,876,018.86 9,697,899.00
Shenzhen Chiwan Transportation Company Limited 37,801,078.98 46,897,834.66
Dongguan Chiwan Wharf Company Limited 13,567,675.68 13,260,132.40
Shenzhen Chiwan Tugboat Company Limited 20,247,549.59 24,912,752.12
Dongguan Chiwan Terminal Company Limited 15,370,363.68 10,133,892.96
Shenzhen Chiwan International Freight Agency
1,006,117.10 975,053.00
Company Limited
Chiwan Shipping (Hong Kong) Ltd 160,677.46 1,183,964.01
Nanshan Group 59,845.95 58,539.14
China Merchants Shangzhi 352,598.40 -
Xuqin 35,741.00 10,000.00
China Merchants Holdings (International) Information
35,400.00 6,400.00
Technology Company Ltd.
Chiwan Property 19,321.90 -
Haiqin Engineering - 389,509.47
Total 289,761,528.32 351,259,091.72
Long-term
Chiwan Wharf Holdings (H.K.) Limited 151,378,000.00 116,662,000.00
payables
Interests payable Shenzhen Chiwan Transportation Company Limited 131,478.11 1,500,827.59
Shenzhen Chiwan Tugboat Company Limited 181,693.54 97,332.08
Shenzhen Chiwan Harbour Container Company Limited 208,854.27 1,492,533.76
Chiwan Container Terminal Company Limited 159,250.00 -
Total 681,275.92 3,090,693.43
Note: The Company collectively manages and coordinates the use of the capital within the Group.
The subsidiaries deposit their funds with the Company, and apply for fund when needed.
The Company collects fund usage expenses based on the actual financing costs incurred.
- 96 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
(XIV) NOTES TO THE KEY ITEMS IN THE COMPANY’S FINANCIAL STATEMENTS -
continued
8. Supplementary information to the cash flow statement
Unit: RMB
Supplementary information Jan.-Jun. 2017 Jan.-Jun. 2016
1. Reconciliation of net profit to cash flows from operating
activities:
Net profits 73,859,979.29 51,196,211.68
Add: Provision for impairment losses of assets (7,730.22) -
Depreciation of fixed assets 4,996,839.58 6,151,059.41
Depreciation and amortization of investment property 241,688.10 289,762.32
Amortization of intangible assets 1,467,600.87 1,675,610.86
Amortization of long-term prepaid expenses 89,810.34 89,810.34
Losses(Profits) on disposal of fixed assets, intangible assets
(81,245.01) 60,987.36
and other long-term assets
Financial expenses 9,366,137.76 22,414,459.22
Loss (Gains) arising from investments (43,578,170.47) (49,037,666.37)
Decrease (Increase) in deferred tax assets - -
Decrease(Increase) in inventories 22,917.22 (35,787.10)
Decrease (Increase) in operating receivables 9,406,947.17 127,664,188.41
Increase (Decrease) in operating payables (72,146,418.49) (49,194,021.19)
Net cash flows from operating activities (16,361,643.86) 111,274,614.94
2. Net changes in cash and cash equivalents:
Closing balance of cash 58,389,908.02 190,393,031.45
Less: Opening balance of cash 97,401,657.09 331,615,767.60
Net increase (decrease) in cash (39,011,749.07) (141,222,736.15)
- 97 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
SUPPLEMENTARY INFORMATION TO THE CASH FLOW STATEMENT
FOR THE YEAR ENDED 30 JUNE 2017
1. BREAKDOWN OF EXTRAORDINARY GAINS AND LOSSES
Unit: RMB
Item Amounts Description
Profit or loss on disposal of non-current assets (448,433.95)
Tax refunds or reductions with ultra vires approval or without official
-
approval documents
Government grants recognized in profit or loss (except for grants that are closely
related to the Company's business and are in amounts and quantities fixed in 498,801.18
accordance with the national standard)
Money lending income earned from non-financial institutions in profit or loss -
The excess of attributable fair value of identifiable net assets over the consideration
-
paid for subsidiaries, associates and joint ventures
Profit or loss on exchange of non-monetary assets -
Profit or loss on entrusted investments or assets management -
Provision of impairment losses for each asset due to force majeure, e.g. acts of God -
Profit or loss on debt restructuring -
Business restructuring expenses, e.g., expenditure for layoff of employees,
-
integration expenses, etc.
Profit or loss relating to the unfair portion in transactions with unfair
-
transaction price
Net profit or loss of subsidiaries recognized as a result of business combination of
enterprises under common control from the beginning of the period up -
to the business combination date
Profit or loss arising from contingencies other than those related to normal operating
-
business
Profit or loss on changes in the fair value of financial assets and financial liabilities
held for trading and investment income on disposal of held-for-trading financial
-
assets, held-for-trading financial liabilities and available-for-sale financial assets,
other than the effective hedging activities relating to normal operating business
Reversal of provision for accounts receivable that are tested for impairment
-
losses individually
Profit or loss on entrusted loans -
Profit or loss on changes in the fair value of investment properties that are
-
subsequently measured using the fair value model
Effects on profit or loss of one-off adjustment to profit or loss for the period
-
according to the requirements by tax laws and accounting laws and regulations
Custodian fees earned from entrusted operation -
Other non-operating income or expenses other than above 1,614,224.70
Other profit or loss that meets the definition of non-recurring profit or loss -
Tax effects (334,195.42)
Effects of minority interest (after tax) (467,611.90)
Total 862,784.61
2. RETURN ON NET ASSETS AND EARNINGS PER SHARE ("EPS")
The return on net assets and EPS have been prepared by Shenzhen Chiwan Wharf Co., Ltd in accordance
with Information Disclosure and Presentation Rules for Companies Making Public Offering No. 9 -
Calculation and Disclosure of Return on Net Assets and Earnings per Share (Revised in 2010) issued by
China Securities Regulatory Commission.
Unit: RMB
Weighted average return on net EPS
Profits incurred in the current period assets (%) Basic EPS Diluted EPS
Net profit for the current period attributable
to ordinary shareholders
5.76 0.429 0.429
Net profit attributable to ordinary shareholders
after deducting extraordinary gains and 5.74 0.427 0.427
losses
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