Annual Report 2021
Stock Code: 603195 Stock Name: Gongniu Group
公牛集团股份有限公司
GONGNIU GROUP CO., LTD.
Annual Report 2021
April 2022
Annual Report 2021
Important Notes
supervisors and senior management of Gongniu Group Co., Ltd. (hereinafter referred to as the
“Company”) hereby guarantee that the contents of this Report are true, accurate and complete
and free of any misrepresentations, misleading statements or material omissions, and collectively
and individually accept legal responsibility for such contents.
unmodified unqualified opinion for the Company.
Officer, and Luo Yuebo, head of the Company’s financial department (equivalent to financial
manager) hereby guarantee that the financial statements carried in this Report are true, accurate
and complete.
As audited by Pan-China Certified Public Accountants LLP, net profit attributable to shareholders
of the Company as the parent stood at RMB2,780,360,732.66 for 2021, and the cumulative distributable
profit of the Company as the parent was RMB3,726,954,923.09 as at 31 December 2021.
The 2021 final dividend plan is as follows: Based on the total share capital at the record date of the
dividend payout, the Company intends to pay a cash dividend of RMB24 (tax inclusive) per 10 shares to
shareholders. According to the total share capital of 601,180,520 shares at the date when this Report was
authorized for issue, the total cash dividend payout is expected to be RMB1,442,833,248.00, accounting
for 51.89% of the net profit attributable to the listed company’s shareholders during 2021. Where any
change occurs to the total share capital at the record date of the dividend payout due to a repurchase of
restricted shares, etc., the cash dividend per share shall remain the same while the total payout amount
shall be adjusted accordingly.
The final dividend plan is subject to final approval by the general meeting of shareholders.
√ Applicable □ Not applicable
Any plans, development strategies and other forward-looking statements mentioned in this Report
shall not be considered as promises to investors. Investors and those concerned shall be sufficiently
aware of the risks and understand the differences between plans and forecasts and promises.
Company’s capital for non-operating purpose.
N/A
Annual Report 2021
prescribed decision-making procedure.
N/A
completeness of this Report.
N/A
The Company has described the possible risks in this Report. For further information, please refer
to contents under the heading “Possible risks” under Item VI (IV) in “Part III Management Discussion
and Analysis”.
□ Applicable √ Not applicable
Annual Report 2021
To Shareholders
The year 2021 saw recurrent waves of the COVID-19 pandemic and a volatile
business environment. Amid a complex external environment and numerous difficulties, we
accepted the challenges, forged ahead and achieved steady growth in operating results.
Thus, our operating revenue increased 23.22% year on year to RMB12.385 billion and the
net profit attributable to our shareholders amounted to RMB2.78 billion, up 20.18% from
the previous year.
Stay true to original aspiration and show resilience
Amid the difficult market conditions of 2021, we remained true to our original
aspiration, focused on improvements in products and services, and devoted ourselves to the
attainment of higher performance in all aspects of our operation. We demonstrated our
resilience through various achievements, including the steady development in various
businesses, the further enhancement of product market share, brand recognition and
reputation while further consolidating our industry leadership with adaptors and wall
switches, the rapid growth of LED lighting, domestic electrical appliances and low-voltage
electricals. Consequently, we laid the foundation for our long-term sustainable
development.
Innovation and growth fueled by ecosystem synergy
We strengthened the ecosystem synergy of products and channels by centering on the
two segments in 2021, namely the smart home ecosystem and new energy. With home
lighting as the core, we further expanded our offering of LED lighting products and
developed smart solutions that integrate healthy lighting, professional lighting effect and
smart control, doing so in an effort to bring consumers a healthier, smarter and more
comfortable lighting experience. A string of household products was launched for
household electricity consumption scenarios. Moreover, to provide a broader range of high-
quality products and services, we extended our service scope from inside the house to the
courtyard and aimed at the smart security segment. We increased our market presence in
electric connection for new energy and developed multiple related products such as
charging plugs and charging points.
Given the trend of consumption upgrading and one-stop shopping among young
people, we constantly evolved the channel system by embracing change and proactive
innovation. With reliance on the Company's edges in powerful channel management and
Annual Report 2021
multicategory integration, we upgraded our physical stores and established a network of
exclusive centers and stores for multicategory integrated sales covering wall switches, LED,
bathroom heaters, low-voltage electrical products and smart clothes drying racks. As a
result, strong sales performance was attained. In response to the trend among industry
channels to pursue the business side and the emergence of invisible channels, the Company
put much effort in top corporate customers and has currently established a solid partnership
with many top real estate and home decoration enterprises. In addition, the Company
embraces new trends as it explores new paths and platforms for online e-commerce
channels and overseas online channels.
Driven by technological innovation and empowered by digital and intelligent
transformation
Over the past year, we have persisted with a “professional and dedicated” attitude and
increased R&D investments to enhance our hard power. Specifically, R&D and operation
headquarters were established in Shenzhen and Shanghai to carry out hardware and
software R&D, industrial design and IoT platform construction, through which the
Company won many international and domestic design awards during the year, including
five iF Design Awards, and the Design Intelligence Award. Meanwhile, we were granted
We actively embraced digital transformation to empower the production and sales
system. With the support of the information technology, we have enhanced the fine
management capabilities of channels and sales with higher efficiency. Substantial
improvements in operating capacity have been achieved through the promotion of a lean,
automatic, digital and smart supply-chain system.
BBS was constantly deepened and capability was cultivated to go further
We also applied the Bull Business System (BBS) to a larger part of the Group during
capabilities in innovative growth, cost reduction and efficiency improvement and risk
control have been improved with excellent results, providing a strong guarantee for the
Group to "go further”.
Systematic strengthening of ESG efforts
In 2021, we strengthened our ESG efforts to promote social welfare by investing more
than RMB32 million in public-welfare programs with respect to culture and education,
health and hygiene, helping the poor and those in need. When Hong Kong was hit by the
Annual Report 2021
pandemic, we promptly organized a task group to offer our help, donated more than 20,000
pieces of products in various categories and supported the construction of Hong Kong’s
makeshift hospitals and efforts to fight the pandemic. Meanwhile, we continued to optimize
the corporate governance structure, promoted the implementation of measures related to
“carbon neutrality and carbon emission peak” and ensured the deeper implementation of
the ESG strategy. This year, we have disclosed our first ESG report.
We have accumulated experience in product, marketing, supply chain and branding
through 27 years of development. And we will continue to build comprehensive
competitive edges in pursuit of sustainable growth, and repay shareholders with better
results. As always, we will take vigorous actions and forge ahead towards the goal of
“Becoming a Leader in the International Civil Electric Industry”.
The Board of Directors of Gongniu Group Co., Ltd
Annual Report 2021
Contents
The financial statements for the year ended 31 December 2021 signed and
stamped by the legal representative, the Chief Financial Officer, and the head
of the financial department
The Independent Auditor’s Report for the year ended 31 December 2021
Documents available for
stamped by the CPA firm, as well as signed and stamped by the relevant
reference
certified public accountants
The originals of all the Company’s documents and announcements disclosed
on newspapers and websites designated by CSRC during the Reporting
Period
Annual Report 2021
Part I Definitions
I Definitions
The expressions in the left column in the table below refer to the contents in the right column unless
otherwise specified.
Definitions of frequently used terms
The “Company”,
refers to Gongniu Group Co., Ltd.
“Gongniu”, or “we”
Reporting Period refers to The period from 1 January 2021 to 31 December 2021
Ningbo Liangji Industrial Co., Ltd., the Company’s controlling
Liangji Industrial refers to
shareholder
Shenzhen Xiaozhou Investment Co., Ltd., the Company’s
Xiaozhou Investment refers to
shareholder
Zhuhai Hillhouse Daoying Investment Partnership (Limited
Hillhouse Daoying refers to
Partnership) , the Company’s shareholder
Ningbo Ninghui Investment Management Partnership (Limited
Ninghui Investment refers to
Partnership) , the Company’s shareholder
Ningbo Suiyuan Investment Management Partnership (Limited
Suiyuan Investment refers to
Partnership) , the Company’s shareholder
Anji Bowei Enterprise Management Partnership (Limited
Bowei Investment refers to
Partnership) , the Company’s shareholder
Ningbo Qiyuanbao Investment Management Partnership
Qiyuanbao refers to
(Limited Partnership) , the Company’s shareholder
Cixi Gongniu refers to Cixi Gongniu Electrics Co., Ltd.
Shanghai Gongniu refers to Shanghai Gongniu Electrics Co., Ltd.
Ningbo Gongniu refers to Ningbo Gongniu Electrics Co., Ltd.
Banmen Electric
refers to Ningbo Banmen Electric Appliance Co., Ltd.
Appliance
Gongniu Photoelectric refers to Ningbo Gongniu Photoelectric Technology Co., Ltd.
Gongniu Precision refers to Ningbo Gongniu Precision Manufacturing Co., Ltd.
Gongniu Digital refers to Ningbo Gongniu Digital Technology Co., Ltd.
Bull International Trading refers to Ningbo Bull International Trading Co., Ltd.
Xingluo Trading refers to Ningbo Xingluo Trading Co., Ltd.
Electric Sales refers to Ningbo Gongniu Electric Sales Co., Ltd.
Bull HK refers to Bull International Trading (HK) Limited
Gongniu Low Voltage refers to Ningbo Gongniu Low Voltage Electric Co., Ltd.
Baidi Electrics refers to Shanghai Baidi Electrics Co., Ltd.
Hangniu Hardware refers to Hangzhou Hangniu Hardware and Electrical Co., Ltd.
Liangniu Hardware refers to Hangzhou Liangniu Hardware and Electrical Co., Ltd.
Feiniu Hardware refers to Hangzhou Feiniu Hardware and Electrical Co., Ltd.
Niuweiwang Trading refers to Suzhou Niuweiwang Trading Co., Ltd.
Cixi Libo refers to Cixi Libo Electric Co., Ltd.
Yaoyang Trading refers to Yichang Yaoyang Trading Co., Ltd.
Huantian Trading refers to Hubei Huantian Technology Co., Ltd.
Jianke Trading refers to Changde Jianke Trading Co., Ltd.
Chenhao Electronic refers to Beijing Chenhao Electronic Technology Co., Ltd.
Dalitek refers to Dalitek Intelligent Technology (Shanghai) Inc.
Hainan Dacheng refers to Hainan Dacheng Supply Chain Management Co., Ltd.
Domestic Electrical
refers to Ningbo Gongniu Domestic Electrical Appliance Co., Ltd.
Appliance
The “Articles of
refers to The Articles of Association of Gongniu Group Co., Ltd.
Association”
The “Company Law” refers to The Company Law of the People’s Republic of China
The “Securities Law” refers to The Securities Law of the People’s Republic of China
A-stock refers to RMB-denominated ordinary stock
Annual Report 2021
CSRC refers to China Securities Regulatory Commission
The Ministry of Finance refers to The Ministry of Finance of the People’s Republic of China
The State Taxation Administration of the People’s Republic of
STA refers to
China
Sinolink Securities refers to Sinolink Securities Co., Ltd.
PCCPA or the
refers to Pan-China Certified Public Accountants LLP
“Independent Auditor”
RMB Expressed in the Chinese currency of Renminbi
RMB’000 Expressed in thousands of Renminbi
refers to
RMB’0,000 Expressed in tens of thousands of Renminbi
RMB’00,000,000 Expressed in hundreds of millions of Renminbi
II Terminology
Products that are typically purchased at the discretion of consumers and
are suitable for use at home, in the office and on other occasions for
Civil electrical refers
power connection, transmission, storage, conversion, control and other
appliances to
functions, such as adaptors, wall switches and sockets, circuit breakers,
distribution boxes, LED lamps, etc.
Products that are produced in accordance with GB/T 2099.3-2015 Plugs
and Socket-outlets for Household and Similar Purposes -- Parts 2-5:
Particular Requirements for Adaptors, GB/T 2099.7-2015 Plugs and
Socket-outlets for Household and Similar Purposes -- Parts 2-7:
refers Particular Requirements for Extension-cord Sockets and GB/T 2099.1-
Adaptors
to 2008 Plugs and Socket-outlets for Household and Similar Purposes --
Part 1: General Requirements, as well as similar foreign standards, and
are commonly referred to as adaptors in the Company.
Consumers or peer companies often call adaptors socket-outlets, power
strips, portable sockets, extension-cord sockets, or power converters.
Power Distribution Unit. PDU is an electric connection product suitable
refers for power distribution at the data center end that can make power
PDU
to distribution more orderly, reliable, safe, professional and beautiful and
make power supply maintenance more convenient and reliable.
Wall switches and wall sockets. Specifically, a wall switch refers to a
device mounted on the wall for switching on/off the current of one or
more circuits and is commonly used to control the on/off status of
Wall switches refers lighting lamps. A wall socket, also known as a fixed socket, is an
and sockets to electrical accessory mounted on the wall, with a socket inserted with a
pin of a plug and installed with terminals for connecting soft cables and
hard wires, and is often used to provide a power supply interface for
electrical products.
Smart refers A novel, intelligent household appliance network that builds an
ecosystem to interconnected smart home ecosystem.
refers Light sources that are produced using light-emitting diodes (such as LED
LED lighting
to bulb lamps), or luminaries that are produced using LED as a light source.
A lighting design style and lighting without the main light source, that is,
No-main-lamp refers a lighting design technique through which downlights, spotlights, light
lighting to belts, track lights and other luminaries are used to create a light (light and
shadow) atmosphere in a point-line-surface combination manner.
Portable chargers that are suitable for AC charging of new energy
refers vehicles and special protectors used to connect household sockets and
Charging plugs
to electric vehicles, with such functions as over-voltage and under-voltage
protection, over-current protection and leakage protection.
Fixed charging devices for AC charging of new energy vehicles that often
Charging refers require special wiring and installation in garages and special parking
points to spaces, with such functions as over-voltage and under-voltage protection,
over-current protection, leakage protection, insulation detection,
Annual Report 2021
electricity billing, timed charging and reserved charging.
Digital refers Accessories that are used directly or indirectly in the use of digital
accessories to products, such as USB cables, chargers and portable chargers.
A mechanical switching device that can connect, carry and disconnect the
current both under normal circuit conditions and under specified
Circuit refers
abnormal circuit conditions. They are also known as automatic switches
breakers to
and are widely used in households, factories and other distribution
circuits.
Products that are embedded in objects such as furniture and used to
Embedded refers
provide solutions for power supply, electricity consumption, lighting and
products to
signal transmission.
Distribution, A sales model in which specialized vehicles are used to provide retail
refers
delivery, visit stores with goods distribution, goods delivery, visit services and door-to-
to
and sales door sales on a regular basis along a fixed planned route.
refers
BBS Bull Business System
to
Part II General Information of the Company and Key Financial
Indicators
I Corporate Information
Company name in Chinese 公牛集团股份有限公司
Abbr. 公牛集团
Company name in English GONGNIU GROUP CO.,LTD.
Abbr. GONGNIU
Legal representative Ruan Liping
II Contact Information
Board Secretary Securities Representative
Name Liu Shengsong Jin Xiaoxue
Tower 20, Baoshi Plaza, 487 Tianlin Tower 20, Baoshi Plaza, 487 Tianlin Road,
Address
Road, Xuhui District, Shanghai Xuhui District, Shanghai
Tel. 021-33561091 021-33561091
Fax 021-33561091 021-33561091
E-mail
liushengsong@gongniu.cn jinxx@gongniu.cn
address
III General Company Information
East Zone of Guanhaiwei Town Industrial Park, Cixi City,
Registered address
Zhejiang Province
Changes of registered address N/A
Tower 20, Baoshi Plaza, 487 Tianlin Road, Xuhui District,
Office address
Shanghai
Zip code 201103
Company website http://www.gongniu.cn
Email address ir@gongniu.cn
IV Media for Information Disclosure and Place where this Report Is Lodged
Media and websites where this Report is China Securities Journal, Shanghai Securities News,
disclosed Securities Daily, and Securities Times
Stock exchange website where this Report is
http://www.sse.com.cn
disclosed
Place where this Report is lodged The Securities Department of the Company
Annual Report 2021
V Stock Profile
Stock profile
Formerly used stock
Class of stock Stock exchange Stock name Stock code
name
Shanghai Stock
A-stock Gongniu Group 603195 /
exchange
VI Other Information
Name Pan-China Certified Public Accountants LLP
Block B, China Resources Building, 1366
Domestic CPA firm appointed Office address
Qianjiang Road, Jianggan District, Hangzhou
by the Company
Accountants
Qian Zhongxian, and Chen Hui
writing signatures
Name Sinolink Securities Co., Ltd.
Office address
Sponsor that exercised Road, Pudong New District, Shanghai
supervision over the Company Representatives
Du Chunjing, and Feng Bing
in the Reporting Period writing signatures
Supervision
From 6 February 2020 to 31 December 2022
period
VII Key Financial Information for the Past Three Years
(I) Key accounting information
Unit: RMB
over-
Key accounting
information
change
(%)
Operating revenue 12,384,916,337.51 10,051,128,834.05 23.22 10,040,439,724.07
Net profit attributable
to the listed
company’s
shareholders
Net profit attributable
to the listed
company’s
shareholders before
exceptional gains and
losses
Net cash generated
from/used in 3,014,326,741.14 3,437,202,711.65 -12.30 2,297,332,006.05
operating activities
Change
of 31
December
December
Equity attributable to
the listed company’s 10,755,751,576.63 9,137,392,569.09 17.71 5,551,303,841.96
shareholders
Total assets 15,473,904,666.62 12,437,541,574.38 24.41 7,416,562,760.11
Annual Report 2021
(II) Key financial indicators
Key financial indicator 2021 2020 2020 change 2019
(%)
Basic earnings per share
(RMB/share)
Diluted earnings per share
(RMB/share)
Basic earnings per share before
exceptional gains and losses 4.39 3.73 17.69 4.12
(RMB/share)
Weighted average return on equity Up by 1.41 per
(%) centage points
Weighted average return on equity
Up by 0.96 per
before exceptional gains and losses 26.77 25.81 50.54
centage point
(%)
Explanations about the key accounting and financial information for the past three years:
□ Applicable √ Not applicable
VIII Accounting Data Differences under China’s Accounting Standards for Business Enterprises
(CAS) and International Financial Reporting Standards (IFRS) and Foreign Accounting
Standards
(I) Differences in net profit and equity attributable to the listed company’s shareholders under
CAS and IFRS
□ Applicable √ Not applicable
(II) Differences in net profit and equity attributable to the listed company’s shareholders under
CAS and foreign accounting standards
□ Applicable √ Not applicable
(III) Reasons for accounting data differences above
□ Applicable √ Not applicable
IX Key Financial Information for 2021 by Quarter
Unit: RMB
Q1 Q2 Q3 Q4
(January-March) (April-June) (July-September) (October-December)
Operating revenue 2,574,274,208.31 3,245,498,210.56 3,192,748,363.27 3,372,395,555.37
Net profit
attributable to the
listed company’s
shareholders
Net profit
attributable to the
listed company’s
shareholders before
exceptional gains
and losses
Net cash generated
from/used in 355,943,367.97 1,235,659,159.38 581,991,433.98 840,732,779.81
operating activities
Indicate whether any of the quarterly financial data in the table above differs from what have been
disclosed in the Company’s past periodic reports.
□ Applicable √ Not applicable
X Exceptional Gains and Losses
√ Applicable □ Not applicable
Unit: RMB
Annual Report 2021
Notes (if
Item 2021 2020 2019
applicable)
Gain or loss on disposal of non-
-9,714,625.18 -669,979.13 -3,929,202.33
current assets
Exceptional tax rebates,
reductions and exemptions
given with ultra vires approval,
in lack of official approval
documents or for other reasons
Government grants through
profit or loss (exclusive of
government grants consistently
given in the Company’s
ordinary course of business at
fixed quotas or amounts as per
governmental policies or
standards)
Capital occupation charges on
non-financial enterprises that 8,121,324.51 407,671.23 1,032,715.90
are recognized in profit or loss
Gain equal to the amount by
which investment costs for the
Company to obtain
subsidiaries, associates and
joint ventures are lower than
the Company’s enjoyable fair
value of identifiable net assets
of investees when making
investments
Gain or loss on non-monetary
asset swaps
Gain or loss on assets entrusted
to other entities for investment 171,623,256.63 166,225,979.47 105,161,168.16
or management
Allowance for asset
impairments due to acts of God
such as natural disasters
Gain or loss on debt
restructuring
Restructuring costs in staff
arrangement, integration, etc.
Gain or loss on the over-fair
value amount as a result of
transactions with distinctly
unfair prices
Current profit or loss on
subsidiaries obtained in
business combinations
involving entities under
common control from the
period-begin to combination
dates, net
Gain or loss on contingencies
that do not arise in the
Company’s ordinary course of
business
Annual Report 2021
Gain or loss on fair-value
changes on held-for-trading and
derivative financial assets and
liabilities & income from
disposal of held-for-trading and
derivative financial assets and 11,107,836.63 -114,631,050.00 -129,159.06
liabilities and other debt
investments (exclusive of the
effective portion of hedges that
arise in the Company’s
ordinary course of business)
Reversed portions of
impairment allowances for
receivables and contract assets
which are tested individually
for impairment
Gain or loss on loan
entrustments
Gain or loss on fair-value
changes in investment property
of which subsequent
measurement is carried out
using the fair value method
Effects of all adjustments
required by taxation,
accounting and other applicable
laws and regulations on current
profit or loss
Income from charges on
entrusted management
RMB295
million
was paid
for the fine
imposed
Non-operating income and by the
-327,898,293.86 -47,932,397.93 -73,067,799.01
expense other than the above anti-trust
decision
Zhe Shi
Jian An
(2021) No.
Other gains and losses that
meet the definition of 2,739,167.53 1,014,971.00
exceptional gain/loss
Less: Income tax effects 96,291,397.10 38,967,887.77 14,394,467.06
Non-controlling interests
effects (net of tax)
Total 147,884,243.10 91,611,646.62 80,149,969.33
Explanation of why the Company reclassifies as recurrent an exceptional gain/loss item defined or listed
in the Explanatory Announcement No. 1 on Information Disclosure for Companies Offering Their
Securities to the Public—Exceptional Gain/Loss Items:
□ Applicable √ Not applicable
XI Items Measured at Fair Value
√ Applicable □ Not applicable
Unit: RMB
Annual Report 2021
Effect on
Item Opening balance Closing balance Change in the period current
profit
Held-for-trading
financial assets
Derivative
financial assets
Total 2,890,459,170.00 5,930,213,050.00 3,039,753,880.00
XII Other Information
□ Applicable √ Not applicable
Part III Management Discussion and Analysis
I Discussion and Analysis on Operations
Amid a complex business environment in 2021, the Company achieved steady growth in operating
results. For the year, operating revenue increased 23.22% year on year to RMB12.385 billion and the net
profit attributable to the Company’s shareholders amounted to RMB2.78 billion, up 20.18% from the
previous year.
In 2021, the Company continued to strengthen BBS and improve its own operating capability. It
maintained robust growth in core advantageous businesses of adaptors and wall switches and sockets,
accelerated business development with respect to new energy and the smart ecosystem, and successfully
launched a string of new products to the market, demonstrating a strong growth momentum.
In 2021, the Bull brand was once again among the “China’s 500 Most Valuable Brands” released
by World Brand Lab, with an increase of RMB1.852 billion in brand value compared with 2020,
reaching RMB17.634 billion. In addition, the Company and its subsidiaries, Ningbo Gongniu, Gongniu
Photoelectric and Gongniu Digital, were certified as high-tech enterprises again in the year. Meanwhile,
the Company was honored as “National Industry-Education Integration Enterprise” by the National
Development and Reform Commission and the Ministry of Education, granted the “AAAAA Good
Standardizing Practice Certificate” by the China Association for Standardization, and recognized as Top
Industry of Zhejiang Province, Seventh Batch of Enterprises in Zhejiang Province for Big Data
Demonstrative Application and Advanced Entity of Quality Management in Zhejiang Province in 2021.
In 2021, the Company achieved sound results in the following aspects:
(I) With deep insight into user needs, the Company continued to launch innovative products
such as smart and ecosystem-based home appliances and new energy-based electrical products.
In 2021, the Company firmly captured the major trends of consumption upgrade, intelligent
transformation, and new energy. With deep insight into user needs, it continued to launch innovative
products such as smart and ecosystem-based home appliances and new energy-based electrical products.
Throughout the year, up to five design awards were earned at home and abroad. As of the date of this
report, the Company has won a total of 51 design awards at home and abroad, including the Red Dot
Award (Germany), the iF Award (Germany), the IDEA Award, the Red Star Design Award (China), the
Annual Report 2021
AWE Award, and the Design Intelligence Award. In addition, technical strengths were further enhanced,
with 470 new patents and 13 new software copyrights granted in 2021. As of the date of this report, the
Company boasts 1,956 valid patents and 41 software copyrights.
In 2021, the electric connection business continued with individualized innovation with regard to
electricity consumption scenarios according to user needs and actively expanded into the sectors of
industrial electric power distribution and new energy-based electric connection. The business recorded
revenue of RMB6.413 billion in the year, an increase of 15.58% year on year.
With user needs as its core, the Company further strengthened the individualized innovation of
adapters in electricity consumption scenarios to highlight the idea of "better homes through space and
function integration". Track sockets were launched and topped the Tmall chart within three months. A
new electric connection technology platform was built to offer a new comprehensive solution for the
electricity usage scenarios in different functional areas. According to users' diverse needs for temporary
electricity usage, the Company introduced retractable power strips in 2021, providing users with a safe,
comfortable comprehensive solution for subdivided scenarios through a range of functions, including
automatic pop up, access to electricity on both sides, a nearly 360-degree rotation, being retractable for
users' need for smart electricity usage, the Company released the "safe core" product series that
integrated the protection and monitoring of power supplies to improve the socket's overall protection of
electrical equipment and achieve it in a digital and visible way. In addition, focusing on young
consumers' yearning for individual expression and a better life, the Company launched the "retro power
strip series" that gained popularity and recognition.
Under the wave of new infrastructure, the Company focused on industrial electric power
distribution with "green technology and energy conservation", "smart interconnection", and "safety and
reliability" at its core. A range of electric connection products suitable for data centers, such as PDU,
busbar, and industrial connector, was launched to provide customers with a comprehensive solution for
smart power distribution for data centers.
In 2021, the Company captured the trend of new energy and gave full play to its electric connection
technology and brand advantage to gain breakthroughs in new energy electric connection. With
technology innovation to address the pain points in usage, it launched a variety of portable chargers for
new energy vehicles and household AC charging points, which received wide appreciation for their
excellent technology, vehicle-grade quality, and innovative appearance and experience design.
Specifically, the portable charger won the German Design Award-Gold 2021.
Furthermore, by leveraging its hardware channels, the Company continued to develop rooted
businesses such as electrical tape and wire reels, thereby achieving accurate inbound marketing,
enhancing channel and customer royalty, and systematically arranging electric connection products.
Annual Report 2021
In the smart electrical lighting business, the Company focuses on the process before household
decoration is completed (referred to as "pre-decoration"), providing wall switches and sockets, LED
lighting, bathroom heaters, circuit breakers, and smart door locks to meet consumers' upgraded needs for
whole-house smart home appliances. In 2021, the business reported revenue of RMB5.551 billion, an
increase of 36.90% year on year.
(1) Wall switches and sockets
In 2021, the Company's wall switches and sockets continued to lead the decorative products. The
product layout was optimized under the strategy of "improvement in basic, upgrade in middle-end, and
breakthrough in high-end", and the construction of different product systems was deepened according to
the differentiated needs of customers in different channels. The revenue generated from wall switches
and sockets in 2021 increased by 29.55% year on year.
Following the successful release of the PIANO series of decorative switches, the Company directed
its planning to the combination of intelligence, material/technology, and industrial design to produce
high-end, high-tech products. Based on the arrangement in the "Bull Smart Single-fire Switch", it
developed and launched the "Light Smart Wireless Remote Control Switch" in 2021, which allows
remote control at home without rewiring and accessing the Internet.
As large panels have become the industry trend, the Company made active efforts in differentiated
decorative large panels within mainstream price segments. At the same time, with a focus on electrical
installation experience, it carried out a new platform design and creatively used the IPD (integrated
product development) idea and the BPD (trending production creation) methodology to connect demand
management, project initiation, development, and other critical processes and stages, thereby managing
the whole process of product development.
With the development of different e-commerce platforms, the Company closely followed the trend
of channels to identify the changes in the needs of consumers on different platforms and actively
conduct product planning and layout. A specific series of products aimed at mainstream e-commerce
platforms were launched in 2021.
In addition, in response to the needs of ToB customers, platform-based modular structure design
was further strengthened to improve product flexibility and scalability. Market competitiveness
continued to rise by matching the differentiated needs of different customers in the business market with
a portfolio of basic, high-end, and smart products.
(2) LED lighting
Adhering to the positioning of "eye-caring", and oriented to meet the needs for light in space and
behavior, the Company has continued to push forward the research of "light" and the innovation and
application of optical design. From developing technologies such as "anti-surge", "visible flicker-free",
and "high-quality lamp bead" to exploring the needs of subdivided groups and in different application
scenarios, the Company is committed to providing consumers with a comfortable, healthy light
environment. In 2021, revenue from LED lighting increased by 38.53% year on year.
Annual Report 2021
The decorative lighting segment responded to consumption upgrades by making greater efforts in
smart products. More than 10 types of "light smart" decorative lamps, such as X16 Dawn and X18 Ultra,
were launched in 2021, allowing users to control them from mobile phones via Bluetooth. In addition,
these lamps ensured even, smooth dimming by setting professional dimming curves and using ultra-
high-precision dimming chips.
Keeping up with market trends, the basic lighting segment continued to enrich products for
different scenarios in order to meet the needs for diverse, high-quality lighting. A variety of products
were developed and launched, such as the High-Brightness Cylindrical Light, PB01 Office Flat Light,
XB01 Linear Light, and those for fire emergency, forming a matrix product layout with different levels,
covering households, industries, offices, hotels, hospitals, supermarkets, department stores, and
franchises.
To let consumers experience eye-caring lighting more closely, Gongniu expanded its mobile
lighting segment in 2021, striving to maximize the lighting experience. Based on the surveys and
insights of the user research team, the newly-released Bull Eye-caring Desk Lamp SR Pro creatively
used optical subtraction and triple anti-glare technologies to offer lighting experience that is “eye-
friendly and ghosting-free”. The product received positive feedback from consumers and won the
German Design Award-Winner. In addition, the Company contributed to industrial regulations by jointly
drafting the group standard, the Specifications for Evaluating the Subtraction Effect of Table Lamps for
Paper Task, with the China Household Electrical Appliances Research Institute.
With a focus on consumers' upgraded needs for minimalist decoration and smart lighting effects,
Gongniu established the smart commercial lighting team striving for a comfortable lighting environment
for each family. A modular lighting product design integrated with a simple, delicate, and light luxury
style reshaped the household space lighting experience. The Company launched a range of no-main-
lamp lighting products such as downlights, magnetic lamps, and liner lamps, which are suitable for
recessed and surface mounted scenarios, and provided multiple lighting solutions to meet the needs for
basic, key, and decorative lighting functions.
As an active promoter of the "anti-flicker" idea, the Company equipped its lighting products with
the "anti-surge" technology to address current instability, conveying its brand philosophy of "care, trust,
and companionship" to consumers.
(3) Other products
To meet consumers' needs for one-stop shopping during pre-decoration and give full play to its
brand and channel advantages, the Company incubated and launched bathroom heaters, smart door locks,
smart clothes drying racks, smart curtain machines, and other smart ecosystem products. In this respect,
operating revenue recorded a year-on-year increase of 139.56% in 2021.
Continuously expanding the definitions of heating and cooling appliances, the Company aimed to
build a healthy home environment in terms of temperature, humidity, purity, freshness, and atmosphere
and to upgrade it with smart technologies. As a result, a range of products such as bathroom heaters,
coolers, ventilating fans, and ceiling fan lights was launched.
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In 2021, the Company's smart ecosystem products were launched one after another and made a
good start. In terms of smart door locks, new series of handle-type smart locks such as ZA, X50, K, and
ZB as well as new series of automatic smart locks such as X70 and QA01 were launched in 2021. Those
with WIFI and Bluetooth were all connected to the "Bull Smart Home" app, improving user experience
from software and hardware. The Company established the ability to integrate research, production, and
sales, deepened the vertical supply chain ability, and completed an over-1,000-square-meter laboratory
specialized for smart door locks to fully practice its quality-first philosophy. As an important entrance
for smart control of home scenarios, smart door locks laid the foundation for the Company's strategy in
smart home ecology. Smart clothes drying racks and smart curtain machines were introduced in several
series, whose differentiated layout was quickly completed through platform-based development.
Focusing on users' needs for light effects and quality, the Company continued to optimize the
control system of Bull Smart Home, further improving the convenience, safety, and stability of the "Bull
Smart Home" app from the perspective of users. It accelerated the development of smart modules and
Bull Cloud, expanded the openness of the mid-office in the business line, and deepened the partnership
with Alibaba, Baidu, JD, Xiaomi, and other Internet of Things platforms that support the voice control of
a range of mainstream smart speakers, thereby quickly improving the product strengths and
technological capabilities of the Company's smart products. To further enhance its competitiveness in
smart lighting control technology, the Company invested in Dalitek Intelligent Technology (Shanghai)
Inc. in 2021. Dalitek introduced smart lighting control to China at an earlier period. It provides smart
control system solutions in lighting, hotel room, and smart home for hotels, office buildings, and houses
with fine decoration, and has completed various benchmark projects for high-end hotels. The smart
lighting control system is its core advantage. Based on Dalitek's lighting control capabilities, Gongniu
will combine its smart industry research to create a smart home ecosystem with no-main-lamp lighting
products as the core.
In terms of circuit breakers, in 2021, the Company started from user needs to keep innovating,
developing, and manufacturing based on the existing technology platforms. Its product lines were
enriched by launching narrow body leakage protectors, upgraded home terminal distribution boxes,
busbars, and double-handle integrated circuit breakers with leakage protection. The revenue generated
from circuit breakers in 2021 increased by 52.16% year on year.
In 2021, the Company's digital accessories generated revenue of RMB373 million, a year-on-year
decrease of 10.79%, primarily due to the impact of the time-to-market of new products and changes in
online and offline consumer traffic. As an extension of the Company's electric connection business, the
digital accessories segment has been actively promoting product innovation and upgrades in digital fast
charging and new energy storage, laying the foundation for future sustainable development.
Adhering to the philosophy of providing consumers with "exquisite, stylish, and young" high-
quality third-party digital accessories, the Company closely followed the industry trend and accelerated
the improvement of the fast charging product layout, with the release of a range of products suitable for
Annual Report 2021
mobile phones and laptops. At present, the layout of fast charging products with power segments of 18W
to 100W has been completed, and a widely applicable, standardized charger power platform has been
launched, effectively improving product standardization, stability, and safety. Meanwhile, the Company
provided consumers with higher-quality charging products by further upgrading the overcharge
protection technology to better extend battery life and reduce charging power consumption.
In addition, product opportunities in the new energy sector were continuously explored. In terms of
outdoor energy storage, the Company conducted in-depth research on critical technologies such as
battery pack management and low power-consumption, high-efficiency fast chargers and inverters and
gave full play to its advantages in strong electric connection and digital fast charging. It launched
outdoor portable chargers with power segments of 300W, 600W, and 1000W that meet the national
safety standard of 220V sine wave AC output and the need for 60WPD two-way fast charging.
Compatible with various digital devices, these products provided consumers with safer, more convenient
electricity usage in outdoor leisure and entertainment scenarios.
In response to the widely differing product performance and quality, and under the principle of
electricity safety, the Company actively participated in the formulation of national and industry
standards as well as enterprise certification to promote industrial progress. It has established channels for
technology exchange with China Electronics Standardization Institute, China Electronic Energy Saving
Technology Association, China Communications Standards Association, and China Quality Certification
Centre, and joined the National Electronic Safety Standardization Technical Committee. In 2021, the
Company participated in the revision or drafting of more than 10 national or industry standards as the
major drafter. These documents include Audio/Video, Information and Communication Technology
Equipment -- Part 1: Safety Requirements, Audio/Video, Information and Communication Technology
Equipment -- Part 2: Explanatory Information related to IEC 62368-1, Technical Requirements and
Testing Methods for Power Adapters for Multimedia Equipment, Technical Specifications of DC Power
Adapter for Vehicle Use, Technical Requirements for Wireless Noise-canceling Headphones, General
Specifications for Hand Wearable Products - Smart Bracelets, General Specifications for Hand
Wearable Products - Smart Watches, and Performance Specifications for Lithium-ion Battery and
Battery Packs for Distributed Energy Storage - Part 1: Home Energy Storage. As its product quality
received ongoing recognition from the market and the industry, the Company was granted honors such
as "Leader of Charger Enterprise Standards" and "Full Member of China Communications Standards
Association".
(II) Channel integration and lean marketing were fully promoted, with the expansion of all
channels, including e-commerce and ToB, accelerated
In 2021, the Company continued to promote marketing reforms according to the changes in
consumer needs, further establishing the ToC and ToB marketing systems and clarifying the synergy and
complementarity strategies of channels including offline hardware, decoration, digital, and online e-
commerce. The hardware channel was primarily for the sales of electric connection products such as
adaptors, as well as circuit breakers and light source-related lighting products. Serving as a shared
Annual Report 2021
channel for all categories in smart electrical lighting, the decoration channel focused on the sales of
domestic decorative products, including wall switches and sockets, LED lighting, circuit breakers,
bathroom heaters, smart door locks, smart clothes drying racks, and smart curtain machines. The digital
channel was primarily for the sales of digital accessories.
In terms of the consumer-side decoration channel, to meet the needs for one-stop purchase during
pre-decoration, the Company further pushed forward a specialized and comprehensive decoration
channel, introducing a range of electrical lighting products such as Bull wall switches and sockets, LED
lighting, circuit breakers, domestic electrical appliances, and smart door locks. At present, more than
Meanwhile, lean marketing was further deepened in the decoration channel. Dealer operation
quality was enhanced by establishing and improving the refined management and empowerment system
as well as by initiating the lean market planning for dealers. With a focus on sales outlets and
hypermarkets, precision advertising was maintained, along with various new forms of digital marketing,
to further improve brand power.
For the consumer-side hardware channel with traditional advantages, the Company further
cultivated super sales outlets to improve the efficiency and output of a single store. In addition, with the
help of dealers across China, it developed supermarkets and convenient stores, entered online delivery
platforms, government-enterprise platforms, and B2B centralized procurement platforms, and acquired
major customers such as trading companies and office supply stores to continuously increase sales
channels and optimize the market structure.
For the consumer-side digital channel, a range of forms was introduced, including mobile phone
repair stores, digital accessories stores, small supermarket and convenient stores, the points mall, and the
gifts channel. The Company prioritized to improve the operation quality of terminal outlets, using CRM
digital tools, innovating the mini-app product management system, and upgrading the model of
"distribution, delivery, visit and sales" to manage digital channel operation in real-time, efficient manner.
For business-side channels, the Company established three independent refined development
systems with decoration enterprises, engineering projects, and fine-decoration houses at the core.
Business-side organization capability was rapidly improved by introducing professionals. Meanwhile,
life cycle management covering research and development, production, delivery, and after-sales was
enhanced according to customer needs, thereby continuously fostering expertise in business-side
development and services. Specifically, regarding domestic decoration, the Company leveraged its
multi-category product portfolio to rapidly develop the domestic and industrial decoration markets. A
stable partnership was established with more than 120 national and regional well-known decoration
companies and platforms such as Shengdu, Yenova, and KE holdings, covering more than 10,000
decoration enterprise outlets. Revenue generated from business-side channels in 2021 increased by
The Company actively promoted the e-commerce strategy of all-category, all-channel digital
marketing, created new benchmark stores for new categories, strengthened the exploration and
Annual Report 2021
integration of specialized dealer resource, and strove to improve the produce planning capabilities of the
e-commerce channel. In terms of products, the increasingly-segmented changes in consumer needs were
monitored and examined in real time. As a result, products were accurately positioned to meet and create
the different needs of online consumers. In 2021, a range of trending new products such as rack sockets,
retro power strips, and new energy charging plugs was launched. In terms of marketing, online brand
communication, product recommendation, and inbound marketing were carried out holistically on
Douyin, Xiaohongshu, Bilibili, and other digital platforms. A closed loop of resources inside and outside
these websites was completed by helping them achieve scale increment, marketing innovation, and
brand building. According to the data of Info Master, the market shares of the Company's converters and
wall switches and sockets on Tmall remained the first in 2021. In 2021, revenue generated from the e-
commerce channel increased by 31.82% year on year.
(III) Ongoing efforts were made to promote a lean, automated, and digital supply chain as
well as the transformation and upgrade to smart manufacturing in order to build a high-quality,
low-cost, and efficient green supply chain
In 2021, with ongoing adherence to the philosophy of lean and flexible manufacturing, the
Company continued to improve the levels of factory lean, automation, and informatization, and
intensified smart and green manufacturing capabilities to further enhance quality and cost advantages.
It continued to promote lean improvement. The converter factory adopted the 3P methodology to
complete relocation with minimal downtime, transfer and upgrade its manufacturing system, and quickly
reached the planned operation level. The wall switch and socket factory pushed forward regional/all-
channel inventory sharing to build a channel logistics model of "logistics center + nationwide cloud
warehouse", reducing the average delivery time from seven to three days, transforming to a supply chain
driven by market needs. The LED lighting segment continued to push forward the building of lean
factories, with more than 60 lean lines built and renovated in 2021, achieving flexible production. With
the mission of building a fast-response lean and flexible factory, the digital factory carried out OEE
(Overall Equipment Efficiency) improvements. As a result, production efficiency and yield were
effectively raised through SMT (Surface Mount Technology) program optimization, innovative
application of through-hole reflow process, SMED (Single-minute Exchange of Die) research, and PCB
assembly optimization. The domestic electrical appliance factory used the 3P tool methodology to
creatively build U-shaped production lines of ceiling fan lamps and clothes drying racks. The new
energy electric connection factory built a new production workshop and continued to improve product
quality by combining new product BPD improvements and lean improvements such as Standard Work
and PSP quality foolproof and upgrades. The smart door locks segment innovated the lean
manufacturing model of "large line to Y-shaped line" to achieve a human-efficiency ratio far
outperforming the industry. Aiming at cost reduction, the hardware factory continued to explore the
integration of in-mold riveting technology and process. The overall equipment OEE reached a high level
through abnormal fast processing, and material and labor costs dropped further through material cost
reduction, mold development, and equipment technical transformation, as well as the advancement of
Annual Report 2021
production processes such as head and tail material welding and unitization. Through lean tools such as
BMS, SMED, TPM, and DM, the molding factory reduced the turnover inventory of injection molded
parts by 40%, shortened the delivery cycle by 50%, and built a range of industry-leading models such as
direct delivery with leveling logistics, plastic spray integration, and energy management.
The Company firmly promoted automation upgrade and transformation to improve product
efficiency. In 2021, the converter factory explored the opportunities for automation expansion. Its robot
hand application technology gained breakthroughs in testing, welding, assembly, and material supply. A
total of 214 automation equipment was introduced to considerably improve equipment flexibility and
availability. The wall switch and socket factory continued to promote automation applications, with the
proportion of automated production capacity further increased. Its labor efficiency and output per capita
rose by 23.6% and 28%, respectively. It continued to deepen quality management reform, verified AI+
visual and AI+ automatic testing, carried the first automatic detection of product appearance defects and
switch feel, and established an online quality inspection system. The LED lighting factory introduced
automatic plug-ins and inspected the product lines, increasing production efficiency by 52%. It also
improved its electronic manufacturing capabilities by introducing multi-automatic riveting machines and
automatic plug-in machines. The digital factory focused on developing highly flexible robot hands and
visual positioning technology and promoted their applications in electronic factories. By introducing
robot hand plug-ins and dispensing, automatic online testing, and automatic conformal coating, it built
the first DIP automation benchmark line, increasing the maximum single product efficiency by 62%.
The molding factory built an automatic injection molding factory with a scale of more than 1,000 units
by introducing automatic code wheels, automatic packing, CCD, AGV, and self-developed robot hands.
In the meantime, all factories continued to increase investment in informatization to build digital
factories. In 2021, the converter factory completed the online information system for direct delivery and
strove to develop a direct delivery model for finished products. The wall switch and socket factory
completed a multi-system collaborative smart delivery system which connected ERP (Enterprise
Resource Planning, PLM (Product Life-cycle Management), WMS (Warehouse Management System),
and QMS (Quality Management System) based on MES (Manufacturing Execution System), increasing
the single order delivery rate by 60%, reducing the inventory sluggish rate by 94%, and passing the on-
site acceptance of the provincial digital factory project. With MES at the core, the molding factory
integrated ERP, PLM, and other software and hardware systems to build a digital smart factory with
"integration of design and manufacturing, automation of production and processing, transparent
production process, and precise logistics control". The hardware factory strove to create a fully digital
hardware supply system by initiating a system to collect digital factory data.
(IV) Intensive efforts were made to build the Bull Business System (BBS), push forward
innovation in organization and business processes, and strengthen the digitization of a whole-
industry chain
In recent years, Gongniu has deeply studied world-leading business management methods and
aimed to build the Bull Business System (BBS) to reduce costs, improve efficiency, and promote
Annual Report 2021
organizational change as well as achieve business innovation and growth, and implement strategic goals.
This philosophy has become an important methodology and operation system for the Company to drive
growth. In 2021, by improving its practices, the Company gained considerable improvements in QDC
(quality, delivery, cost) indicators, created 12 best practices as the lean benchmark, exported 21 Gongniu
fundamental methodologies, developed 10 black-belt and 546 green-belt talents, and increased lean
transformation from two points to three points. As a result, the Company's business management
continued to rise.
Currently, the BBS has empowered the entire value chain covering research and development,
manufacturing, and sales. Starting from the strategic deployment of goal-driven breakthroughs, the
Company used the BBS methods (such as 3P rapid self-production, BPD trending product development,
and lean marketing) to help enhance the competitiveness of core business and incubate strategic new
businesses rapidly. In the meantime, the BBS was used to empower newly-acquired companies to help
them fit in and develop in order to better gain strategic synergy.
To further develop its business, the Company set up the Pearl River Delta Center in Shenzhen and
the Shanghai Center in Shanghai in 2021, two cities with intensive technology and talents. The
development and innovation, as well as business development of the smart and new energy segments,
were carried out to solidify the foundation of strategic new businesses.
The Company continued to strengthen its teams by carrying out the ability development plan based
on the Bull Leadership Model for management talents at all levels. Meanwhile, with a large number of
outstanding talents joining the Company, it strengthened the incentives in the restricted equity incentive
scheme for core management and technical backbones as well as in the equity ownership scheme for
special talents. By doing so, it integrated the interests of shareholders and the Company and the personal
interests of the core team, thereby better attracting and retaining talents that contribute to organizational
development.
In the meantime, the Company continued to vigorously push forward a digital whole-industry chain
and firmly promote process management, process digitalization, and data asset management. In addition
to the aforementioned digitization of the supply chain, MRO (Maintenance Repair and Operations) came
into operation in 2021. The first regional cloud warehouse pilot was successfully run and began to
expand across the country. Digital marketing tools continued to empower dealers and outlets, with
CRM+AI management achieved in all hardware and digital channels. Moreover, the Company further
deepened and optimized the e-commerce middle-office system and strengthened the coordination with
external e-commerce platforms and their warehouse platforms in order to improve e-commerce
operation efficiency and boost the sustainable development of online business.
II Introduction of the Industry where the Company Operates during the Reporting Period
According to the Guidelines for the Industry Classification of Listed Companies revised by the
CSRC in 2012, the business of the Company is assigned to “Manufacturing Industry of C38 Electric
Machine and Equipment”. Besides, according to the Industry Classification of National Economy (GB/T
Annual Report 2021
assigned to “Manufacturing Industry of C38 Electric Machine and Equipment”. Among them, adaptors,
wall switches and sockets, and digital accessories are all assigned to the specific type of “3899 Other
Not Classified Manufacture of Electric Machine and Equipment”. LED lighting is assigned to the
specific type of “3872 Manufacture of Lighting Devices”.
With the continuous increase of the resident discretionary income and consumption level in China,
industries such as household appliances, consumer electronics, real estate and fixtures grow
continuously and rapidly, promoting the market demand for products in electric connection, electrical
lighting and digital accessories. Nowadays, China is the main producing base of adaptors across the
world. The brands of wall switches and sockets in China’s market are nationally leading as well as
internationally famous. In the field of lighting, China has become the workshop of the world with
products sold to around 220 countries and regions. Comprehensively, electric connection products with
adaptors as the core and electrical lighting products with wall switches and sockets and LED lighting as
the core have entered the mature period of industrial development. Among them, new energy electricity,
household intelligence and household ecosystem have become the new development trend. The
consumer electronics industry represented by smart phones and digital accessory industry both increase
rapidly.
Products of electric connection, smart electrical lighting and digital accessories all have close
connection to people’s lives with no obvious characteristics of industry cycle and regions. Among them,
products of electric connection and smart electrical lighting have been affected by some factors
including cessation of business in major retail terminal end outlets (such as hardware stores, specialized
markets and so on) and the reduction of housing fixtures during the Spring Festival. Therefore, the first
quarter always has the fewer sales volume all over the year.
The Company is specialized in the civil electrical industry, and has been recognized as one of the
“Top 100 Manufacturing Enterprises of Zhejiang Province” for a few consecutive years. Since its
establishment in 1995, the reputation of the Bull brand has increased constantly and its sales volume has
always been leading. In 2021, the brand was once again among the “China’s 500 Most Valuable Brands”
released by World Brand Lab, with a brand value of RMB17.634 billion.
The Company always adheres to the operating philosophy of “Be Professional and Concentrated,
Strive for No. 1 and Go Further”. According to the data provided by Info Master, in 2021, the
Company’s products such as adaptors and wall switches and sockets had the No. 1 online sales volume
in Tmall market. In June 2021, the Company successively launched new products such as new energy
vehicle charging plugs and charging points for e-commerce platforms, with the sales volume in a leading
position among third-party brands.
III Principal Activities of the Company’s Business during the Reporting Period
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During the Reporting Period, the Company focused on three areas: electric connection, smart
electrical lighting and digital accessories. The main products of electric connection are adaptors (power
strips), new energy vehicle charging plugs/points, data center PDU, busbars and so on. The products of
smart electrical lighting mainly include wall switches and sockets, LED lighting, circuit breakers,
bathroom heaters, smart door locks, smart clothes drying racks, smart curtain machines and so on. The
products of digital accessories mainly include mobile equipment chargers such as phones, portable
chargers, outdoor portable chargers and so on.
Electric Connection Smart Electrical Lighting Digital Accessories
The Company adheres to the vision of “Becoming a Leader in the International Civil Electric
Industry”, the mission of “providing safe and comfortable electricity experience for customers” and the
development philosophy of “be professional, concentrated and go further”. Since its establishment in
quality. The Company started to from the segmentation of power strips, constantly promoting the
innovation of functions, technology and design, and developing batches of new products popular among
consumers. Focusing on innovation, the Company has the comprehensive advantages of product R&D,
marketing, supply chain and branding. After years of developing and expanding, the Company has
formed three major business segments: electric connection, smart electrical lighting and digital
accessories. Besides, it has also formed sustainable business layout in the fields of civil electrical
industry and lighting. Facing the consumers’ upgrading demand for smart and ecosystem-based
household products, and the consumer trend of green and low carbon products, the Company set the
strategic goal of “Smart Ecosystem + New Energy Strategy” in 2021. Besides, the Company has
constantly built firmer competitive edge in line with the trends of the times to achieve the business goal
and vision.
(1) Procurement model: The procurement business of the Company mainly includes the
procurement of operating supplies including copper, silver, aluminum, tin, plastic granule, paper pulp,
Annual Report 2021
etc., and the procurement of non-operating supplies such as IT materials, administrative supplies and so
on. The Company has established a procurement strategy with quality as the core. It has selected the
main supplier through the mechanism of strict supplier entrance and regular examination and inspection.
Besides, the Company established strategic cooperating relationships with the main suppliers to ensure
the quality and delivery. The Company has set up a procurement sharing platform with professional
personnel at the group level. It improves the ability of negotiating prices and debasing procurement costs
through central procurement. Furthermore, the Company has optimized and improved the suppliers
management system, ERP system, manufacturing and storage system, etc. Meanwhile, it has improved
the management of procurement and constantly improved the procurement efficiency.
The Company has performed central procurement of bulk raw materials such as copper, silver,
aluminum, tin, plastic granules, paper pulp and so on. In addition, the Company has locked the trading
price through ways such as forward hedging to reduce the uncertain risk brought by the price fluctuation
in spot market of raw materials.
(2) Production model: The Company has adopted the manufacturing model of “Market Forecast +
Safe Inventory”. Products are mainly self-made. Some new products and supporting products have been
made by adopting the OEM manufacturing mode. Every factory is responsible for the production of
corresponding products and parts. They have ensured product quality, efficient management and on-time
delivery at the same time. Meanwhile, the Company has constantly promoted the innovation of
manufacturing mode. It has ensured the product quality, improved the flexible manufacturing efficiency
and reduced cost by continuously improving the level of specialization, automation and informatization.
(3) Sales model: The Company has established online and offline integrated sales model through
omnichannel. The offline sales model is mainly based on distribution and partially based on direct
selling. The Company has promoted the innovative offline sales mode of “distribution, delivery, visit
and sales” in the field of civil electrical appliances and implemented refined management of channels.
Through efficiently organizing and transferring dealer resources around the country, and long-term
accumulation, the Company has established distribution network with 1.1 million retail stores covering
national urban and rural areas. The online channel has covered the mainstream e-commerce platforms
through direct selling + distribution, with which we have made every effort to build the flagship stores
into a brand promotion window. The Company has actively implemented digital marketing to realize
“diversion outside the online channel and sales inside the channel” with the help of each traffic inlet. At
the same time, the Company has accelerated the development strength of ToB channels such as
decoration and engineering projects. Besides, it has actively explored overseas markets to speed up the
global layout.
IV Analysis on Core Competitiveness during the Reporting Period
√ Applicable □ Not applicable
The Company has always adhered to the core values of “Honest, Faithful, Professional and
Concentrated”. It has gradually established strong and comprehensive competitive edges through
continual and comprehensive innovation and reform in product development, quality control, channel
Annual Report 2021
development, marketing and supply chain construction. During the Reporting Period, the Company’s
core edges were continuously strengthened.
(I) The Company has established an edge of innovative product development based on
consumer demand, enabling constant product launches.
For long, the Company has attached great importance to research on consumer demand and the
innovation of product planning and research. It has always viewed the promotion of consumer
experience as the primary goal in product research. The Company has established an integrated
innovation system and teams of forward research, product planning and research. It has created and
applied all kinds of new technologies, materials and crafts. Through the constant superposition of micro
innovation, the Company has promoted a batch of products of electric connection, smart electrical
lighting and digital accessories with new and different characteristics in the aspects of design,
performance, technology and function, which are popular among consumers. For years, the Company
has participated in drafting 93 national standards, industry standards and association standards. It is the
vice chairman unit of the Electrical Accessories and Household Controller Branch of the China
Electrical Equipment Industry Association. It is also the vice chairman unit of the National Technical
Committee for Standardization of Electrical Accessories. What’s more, it is the first electrical enterprise
in the industry to draft the “Made in Zhejiang” standard and attain certification.
As of the date of this report, the Company holds 1,956 valid patents. During the Reporting Period,
the Company has applied for 451 patents and been granted 470 new patents. At the same time, the
Company is a national industrial design center approved by the Ministry of Industry and Information
Technology of the People's Republic of China. It is also a unit of national postdoctoral workstation.
(II) The Company has always adhered to the philosophy of winning through high quality and
put in place an efficient quality control system.
Since its founding, the Company has aimed to manufacture high-quality products. The idea of
winning through high quality has gained support among all in the Company. The Company has
established a good brand image and reputation on the market with reliable product quality.
In the aspects of selecting raw materials, procurement, research and production process control,
product testing and after-sales service, the Company has established a comprehensive and perfect quality
management system of product planning -- product design -- procurement -- production in batch quantity
-- post-sale strictly in line with the national standards, related laws and regulations, and enterprise
standards. In order to ensure the highly efficient operation of the quality management system, the
Company has been equipped with more than 900 professional personnel in quality management,
experiment testing, analysis and quality control. It has also had more than 7,000 sets of testing
equipment for experiment and production line automation, and established 10 high-standard laboratories
for R&D, development and quality testing in the industry. The related laboratories have acquired CNAS
National Laboratory Certification, UL WTDP Laboratory Certification and other product certificates
such as CCC, VDE, UL, NF, CE, and so on. It assures solid resources for management and control of
product quality.
Annual Report 2021
With long-term accumulation, the Company has formed an efficient and systematic quality
management and control system. It has achieved the management system certification of IS09001,
ISO14001 and OHSAS18001. Besides, it has been successively awarded 20 prizes related to quality
such as “National Qualified Products of Stable Quality”, “Products with Reliable Quality”,
“Demonstration Enterprise of Export Quality and Safety in China”, “Famous Brand Products in
Zhejiang” and “Ningbo Mayor Quality Award”.
(III) The Company always adapts itself to market changes. Supported by the offline
marketing network of more than 1.1 million outlets covering urban and rural areas, as well as a
professional online marketing network, the Company has established a marketing system
featuring coordinative online and offline channels in the civil electrical industry.
The Company has implemented an innovative offline sales model featuring “distribution, delivery,
visit and sales” in the civil electrical industry. In China, it has already developed more than 750,000
hardware channel retailers (including hardware stores, grocery stores, office supplies stores,
supermarkets and so on), more than 120,000 specialized decoration and lamp decoration retailers, and
more than 250,000 digital accessories channel retailers. These channels have expanded the selling points
to stores, large market places, professional markets in urban and rural areas, forming an offline
marketing network hard to be duplicated. At the same time, the Company has established a professional
e-commerce direct selling operational team and an online distributor system with strong ability.
Nowadays, the Company has comprehensively entered the leading e-commerce platforms such as Tmall,
Taobao, JD.com, Vipshop, Pinduoduo, and so on. It has efficiently explored dozens of online authorized
distributors, actively implemented digital marketing and achieved “diversion outside the online channel
and sales inside the channel” with the help of each traffic inlet.” According to the data provided by Info
Master, in 2021, the Company’s products of adaptors and wall switches and sockets had the largest
market share in Tmall.
The high quality coordinated development between offline and online channels has helped the
Company establish a comprehensive, multilevel and stereoscopic marketing network, which is the
advantage of the Company to maintain sustainable development and competitiveness in the industry.
Simultaneously, the Company has always adhered to the refined management of channels for years,
developing established systems in the aspects of development, management, operation, and so on. It has
had the advantage of exploring new channels.
(IV) The Company has put in place an integrated branding model with selling point
promotion as the core, making “Bull” a household name.
The Company has adhered to the branding model with selling point promotion as the core. Over the
past 20 years, the Company has made constant efforts to support the distributors to put the brand of Bull
in retail stores and put advertising resources such as display inside and outside the stores, in so doing the
brand of Bull has been disseminated to cities, towns and counties. It has formed a simple, efficient and
unique branding model. With an increasingly strong presence, Bull has become a household name.
Meanwhile, the Company has constantly enriched the brand connotation and improved the brand’s
Annual Report 2021
penetration and stickiness among different consumers with the help of diversified, intelligent and young
new products and the Internet new media promotion.
During the Reporting Period, the Bull brand was once again among the “China’s 500 Most
Valuable Brands” released by World Brand Lab. It has come out in front in the light industry group in
(V) The Company boasts a supply chain system featuring advanced manufacturing
technologies and automation, helping it stay competitive with respect to quality, efficiency and cost.
The Company has regarded manufacturing technology as the important carrier of core
competitiveness in the supply chain. It has been equipped with a professional mold factory. The factory
has designed, developed and manufactured all kinds of high-precision mold for the Company’s
diversified products by adopting high-precision tolerance grade technology, advanced automatic pouring
technology and 3D print technology. At the same time, the factory has adopted manipulator technology
and post processing free technology to achieve automation of injection molding production and molding
integration as well as to greatly improve the product quality, production efficiency and production
innovation. At the same time, the Company has established a dust free electronic factory which has
adopted 3D image analysis technology and phase shifting AOI technology. The factory has also been
equipped with an independently developed four-axis manipulator. It has ensured the quality of PCBA
board products through image comparison after firing, greatly supporting the Company’s manufacturing
of digital accessories, lighting and smart products.
The Company has constantly improved the fine, automatic and smart manufacturing level and
established an industrial automatic team of integrated research, design and manufacturing. The
independent development and design, and the assembly application capability of automatic devices and
smart assembly devices have constantly improved. The flexible production mode of “man-machine
integration” has been promoted rapidly. With the help of a leading automatic stereoscopic warehouse
and smart sorting shipment system, the Company has achieved the mechanization and automation of
warehouse work, which greatly improves the speed of distribution and delivery, and the customer
response ability. The automatic stereoscopic warehouse has efficiently connected the front-end
automatic production. The smart manufacturing system for the whole process of feedstock -- production
-- storage -- shipment has been established, providing solid support for the sustainable development of
the Company’s business.
(VI) The Company has established the Bull Business System (BBS) with innovation and
growth as the core, driving growth and breakthroughs to create a stream of business growth
points.
The Company has continuously summarized and iterated, and built the unique Bull Business
System (BBS) by importing and extracting the essence of advanced management modes at home and
abroad, and combining it with its own best experience. It has also established a whole value chain of
R&D, manufacturing and marketing with value creation as the core, innovation increase as the key point
and cost reduction, efficiency increase as the base. Gongniu BBS takes “empowering everyone and
Annual Report 2021
every business of Gongniu in pursuit of faster, higher and further growth” as the mission. It has
constantly strengthened the system development and promoted the ability internalization. Focusing on
the Company’s strategic goal, Gongniu has fully used the BBS instrumental methodology mode (such as
Gongniu BBS has driven the Company to constantly make breakthrough to promote the development of
new business, and facilitate the cost reduction and efficiency increase of the traditional business, and the
innovation development. It has also promoted the achievement of high performance objectives, creating
a stream of business growth points for the Company.
V Major Operations during the Reporting Period
For the Reporting Period, the Company recorded operating revenue of RMB12.385 billion, up
year-on-year.
(I) Analysis of Principal Operations
Unit: RMB
Item 2021 2020 Change (%)
Operating revenue 12,384,916,337.51 10,051,128,834.05 23.22
Cost of sales 7,808,540,666.84 6,018,606,539.57 29.74
Selling expense 560,187,002.80 517,846,532.13 8.18
Administrative expense 427,615,556.97 430,706,547.54 -0.72
Finance costs -87,842,281.32 -35,737,486.54 Not applicable
R&D expense 471,015,016.82 401,181,690.28 17.41
Net cash generated from/used in
operating activities
Net cash generated from/used in
-1,588,987,931.15 -4,249,591,758.14 Not applicable
investing activities
Net cash generated from/used in
-700,808,446.71 1,925,600,149.55 -136.39
financing activities
The change in operating revenue was primarily driven by the steady growth in the traditional core
business and the fast growth in new businesses in the year.
The change in cost of sales was primarily driven by the increased costs along with the increased revenue.
The change in selling expense was primarily driven by the increased advertising and marketing expenses.
No significant change occurred to administrative expense.
The change in finance costs was primarily driven by the increased interest income from bank deposits in
the year.
The change in R&D expense was primarily driven by the increased R&D investments.
The change in net cash generated from/used in operating activities was primarily driven by the increased
procurement amount as a result of the rising prices of bulk materials.
The change in net cash generated from/used in investing activities was primarily driven by the decreased
purchases of financial products in the year.
The change in net cash generated from/used in financing activities was primarily driven by the arrival of
raised funds last year.
Particulars about any significant change to the Company’s business nature, profit composition or sources
in the current period.
□ Applicable √ Not applicable
√ Applicable □ Not applicable
In 2021, the Company continued to implement individualized innovation in electricity scenarios
and develop products based on customer demands for its electric connection business, and the business
Annual Report 2021
saw steady growth as a result. For the smart electrical lighting business, the Company actively expanded
new product categories and accelerated the construction of a smart home ecosystem with no-main-lamp
lighting as the core, which resulted in rapid growth in the business. The revenue from the digital
accessories business showed a slight decline, primarily driven by the time-to-market of the new products
and the change in online and offline traffics.
(1) Principal operations by operating division, product category, operating segment and sales
model
Unit: RMB
Principal operations by operating division
YoY
Gross YoY
change in
Operating profit change YoY change in gross
Operating revenue Cost of sales operating
division margin in cost of profit margin (%)
revenue
(%) sales (%)
(%)
Civil electrical Decrease by 3.21 perce
appliances ntage points
Principal operations by product category
YoY
Gross YoY
change in
Operating profit change YoY change in gross
Operating revenue Cost of sales operating
division margin in cost of profit margin (%)
revenue
(%) sales (%)
(%)
Electric
Decrease by 6.18 perce
connection 6,413,208,065.02 4,300,354,553.32 32.95 15.58 27.33
ntage points
products
Smart
electrical Decrease by 1.13 perce
lighting ntage points
products
Digital Increase by 4.63 perce
accessories ntage points
Principal operations by operating segment
YoY
Gross YoY
change in
Operating profit change YoY change in gross
Operating revenue Cost of sales operating
division margin in cost of profit margin (%)
revenue
(%) sales (%)
(%)
Decrease by 3.00 perce
Domestic 12,059,354,004.16 7,536,455,016.87 37.51 22.71 28.91
ntage points
Decrease by 8.89 perce
Overseas 277,516,686.13 254,307,737.60 8.36 43.06 58.41
ntage points
Note: Electric connection products include adaptors, electrical tape, new energy vehicle charging
plugs/points, wire coil and couplers. Smart electrical lighting products include wall switches and sockets,
LED lighting, circuit breaker, bathroom heaters, smart door locks, smart clothes drying racks, smart
curtain machines and other smart ecosystem products. Digital accessories include digital accessories,
digital gift boxes and outdoor portable chargers.
The performance of the Company’s principal businesses by operating division, product category,
operating segment and sales model:
① For electric connection products, the revenue amounted to RMB6,413 million, up 15.58% year on
year, while the cost of sales stood at RMB4,300 million, up 27.33% year on year. Supported by the
brand advantage and the hardware channel advantage, the electric connection business, as the
Company's core business, maintained a steady growth.
Annual Report 2021
② For smart electrical lighting products, the revenue amounted to RMB5,551 million, up 36.90% year
on year, while the cost of sales stood at RMB3,218 million, up 39.62% year on year. In this business, the
Company accelerated the development of new business and decoration channels were expanded during
the Reporting Period, achieving strong growth in all operations.
③ For digital accessories, the revenue amounted to RMB373 million, decrease 10.79% year on year,
while the cost of sales stood at RMB272 million, decrease 16.11% year on year. This was mainly
derived from the impact of time-to-market of the new products and the change in online and offline
traffics.
(2) Output and unit sales analysis
√ Applicable □ Not applicable
YoY YoY
YoY
Primary change in change in
Unit Output Unit sales Inventory change in
products unit sales inventory
output (%)
(%) (%)
Electricity
connecting 54,626.38 53,465.18 3,433.70 29.94 21.48 61.67
pieces
products
Smart
electrical 0,000
lighting pieces
products
Digital 0,000
accessories pieces
Notes:
In the current period, the inventories of electric connection products and smart electrical lighting
products both showed a significant increase compared with last year, mainly due to the strategic re-
stocking due to strong sales this year. In contrast, the inventory of digital accessories showed a
substantial decrease compared with last year, mainly due to product transition and optimization of
inventory management.
(3) Execution of significant purchase or sales contracts
□ Applicable √ Not applicable
(4) Cost analysis
Unit: RMB
By operating division
As % As %
of of
Change
total total
Operating in
Cost category 2021 costs 2020 costs Note
division amount
in in
(%)
(%) (%)
Direct
materials
Civil
Direct labor
electrical 494,515,730.18 6.33 451,436,344.13 7.50 9.54
cost
appliances
Manufacturing
expense
Notes:
The cost of direct materials increased during 2021 compared to 2020, primarily driven by the rising
prices of bulk materials.
(5) Changes to the consolidation scope due to changed ownership in principal subsidiaries in the
Reporting Period
□ Applicable √ Not applicable
Annual Report 2021
(6) Significant changes to the business scope or product or service range in the Reporting Period
□ Applicable √ Not applicable
(7) Major customers and suppliers
A. Major customers
Sales to the top five customers stood at RMB1,592.7148 million, accounting for 12.86% of the total
annual sales. Sales to the related-parties among the top five customers stood at RMB0, accounting for
Indicate whether sales to a single customer accounted for over 50% of the total sales, there was any new
customer in the top five customers, or the Company heavily relied on a few number of customers in the
Reporting Period.
□ Applicable √ Not applicable
B. Major suppliers
Purchases from the top five suppliers stood at RMB2,261.6093 million, accounting for 22.23% of the
total annual purchases. Purchases from the related-parties among the top five suppliers stood at RMB0,
accounting for 0% of the total annual purchases.
Indicate whether purchases from a single supplier accounted for over 50% of the total purchases, there
was any new supplier in the top five suppliers, or the Company heavily relied on a few number of
suppliers in the Reporting Period.
□ Applicable √ Not applicable
Other information:
N/A
√ Applicable □ Not applicable
Item 2021 2020 Amount of change Change (%)
Selling expense 560,187,002.80 517,846,532.13 42,340,470.67 8.18%
Administrative
expense
R&D expense 471,015,016.82 401,181,690.28 69,833,326.54 17.41%
Finance costs -87,842,281.32 -35,737,486.54 -52,104,794.78 Not applicable
(1) Selling expense increased primarily driven by the increased advertising and marketing expenses.
(2) R&D expense increased primarily driven by the increased R&D investments.
(3) Finance costs decreased primarily driven by the increased interest income from bank deposits in the
year.
(1) R&D investments
√ Applicable □ Not applicable
Unit: RMB
Expensed R&D investments in the current
period
Capitalized R&D investments in the
current period
Total R&D investments 471,015,016.82
Total R&D investments as % of operating
revenue
Capitalized R&D investments as % of
total R&D investments
(2) R&D personnel
√ Applicable □ Not applicable
Number of R&D personnel 1,431
R&D personnel as % of total employees 11.56
Educational background of R&D personnel
Educational background Number of employees
Doctoral degree 1
Annual Report 2021
Master’s degree 76
Bachelor’s degree 783
Junior colleges 512
Senior high school and below 59
Age structure of R&D personnel
Age Number of employees
Below 30 (exclusive) 411
(3) Other information
√ Applicable □ Not applicable
The Company, as a national industrial design center and a national postdoctoral workstation, has
always attached importance to product development and technological innovation. By establishing a
leading scientific research innovation platform and innovating mechanism, the Company focuses on the
research of industry basic and key common technologies to continuously improve product development
and technological innovation capability. Meanwhile, with great emphasis on cultivation and introduction
of talents of R&D and product planning as well as adhering to market demand-oriented principle, the
Company continues to strengthen the insight and research on the potential consumer demands and
scenario-based requirements, constantly expands the areas by launching products that meet consumer
demands to lead the industry development. In addition, the Company continues reinforcing the
construction of the standardization system and the strategic layout of intellectual property rights, and
constantly promotes open innovation to set an excellent example with respect to innovation capability.
(4) Reasons for any significant change to the composition of R&D personnel and the impact on the
Company
□ Applicable √ Not applicable
√ Applicable □ Not applicable
Item 2021 2020 Amount of change Change
Net cash generated
from/used in 3,014,326,741.14 3,437,202,711.65 -422,875,970.51 -12.30%
operating activities
Net cash generated
from/used in -1,588,987,931.15 -4,249,591,758.14 2,660,603,826.99 62.61%
investing activities
Net cash generated
from/used in -700,808,446.71 1,925,600,149.55 -2,626,408,596.26 -136.39%
financing activities
(1) Net cash generated from operating activities decreased primarily driven by the increased
procurement amount as a result of the rising prices of bulk materials.
(2) Net cash used in investing activities decreased primarily driven by the decreased purchases of
financial products in the year.
(3) Net financing cash inflow last year changed to outflow in the current year primarily driven by the
arrival of raised funds last year.
Annual Report 2021
(II) Significant changes in profit incurred by non-core business
□ Applicable √ Not applicable
(III) Analysis of assets and liabilities
√ Applicable □ Not applicable
Unit: RMB
As % of As % of
closing opening
Change
Item Closing amount total Opening amount total Note
(%)
assets assets
(%) (%)
Held-for-
trading
financial
assets
Derivative
financial 3,613,050.00 0.02 27,159,170.00 0.22 -86.7
assets
Notes Not
receivable applicable
Receivables
financing
Other
receivables
Inventories 1,376,987,122.60 8.90 788,240,060.31 6.34 74.69
Other current
assets
Right-of-use Not
assets applicable
Long-term
prepaid 17,750,835.99 0.11 3,150,000.00 0.03 463.52
expense
Deferred
income tax 116,456,369.78 0.75 66,903,177.28 0.54 74.07
assets
Notes payable Not
applicable
Accounts
payable
Contract
liabilities
Other payables 430,813,760.10 2.78 219,091,086.62 1.76 96.64
Other current
liabilities
Current
portion of non- Not
current applicable
liabilities
Long-term
borrowings
Lease Not
liabilities applicable
Other non-
current 46,125,187.50 0.30 28,037,156.40 0.23 64.51
liabilities
Annual Report 2021
Treasury
shares
Other
comprehensive 7,537,390.37 0.05 28,863,769.91 0.23 -73.89
income
Retained
earnings
Other notes:
Held-for-trading financial assets increased primarily driven by the increased closing balance of financial
products with increased floating income.
Derivative financial assets decreased primarily driven by the decreased carrying closing amount of
floating income of hedges.
Notes receivable increased primarily driven by the increased closing balance of trade acceptance notes
receivable.
Receivables financing increased primarily driven by the increased closing balance of bank acceptance
notes receivable.
Other receivables increased primarily driven by the increased closing balance of security deposit
payments.
Inventories increased primarily driven by the strategic re-stocking at the end of the year.
Other current assets decreased primarily driven by the decreased closing balance of structured deposits
held.
Right-of-use assets increased primarily driven by the adoption of the new accounting standard for leases.
Long-term prepaid expense increased primarily driven by the new addition of the equity incentives that
had been granted to awardees under the special talent stock ownership plan but were not yet amortized.
Deferred income tax assets increased primarily driven by the closing accrued deductible temporary
differences arising from sales discounts.
Notes payable increased primarily driven by the increased closing balance of notes payable.
Accounts payable increased primarily driven by the increased procurement in the year.
Contract liabilities increased primarily driven by the increased closing amount of advancements from
customers.
Other payables increased primarily driven by the increased closing balance of accrued sales discounts.
Other current liabilities increased primarily driven by the increased output VAT to be written off.
Current portion of non-current liabilities increased primarily driven by the increased current portion of
long-term borrowings.
Long-term borrowings decreased primarily driven by the transfer of long-term borrowings to the current
portion of non-current liabilities.
Lease liabilities increased primarily driven by the adoption of the new accounting standard for leases.
Other non-current liabilities increased primarily driven by the increased repurchase obligations of
restricted shares that were over one year.
Treasury shares increased primarily driven by the increased equity incentives.
Other comprehensive income decreased primarily driven by the decreased net gain (exclusive of tax)
recognized on futures contracts for hedging purposes.
Retained earnings increased primarily driven by the increased profit in the year.
□ Applicable √ Not applicable
□ Applicable √ Not applicable
□ Applicable √ Not applicable
(IV) Industry Environment Analysis
√ Applicable □ Not applicable
For details, see “(I) Industry landscape and trends” under “VI Outlook Discussion and Analysis” of
Part III Management Discussion and Analysis”.
Annual Report 2021
(V) Investments made
Equity investments in other entities
□ Applicable √ Not applicable
□ Applicable √ Not applicable
√ Applicable □ Not applicable
For details, see “(2) Changes in significant constructions in progress in the current period” under “22.
Construction in progress” in “VII Notes to the Consolidated Financial Statements” of “Part X Financial
Statements”.
√ Applicable □ Not applicable
For details, see “XI Items Measured at Fair Value” in “Part II Corporate Information and Key Financial
Information”.
□ Applicable √ Not applicable
(VI) Sale of significant assets and equity investments
□ Applicable √ Not applicable
(VII) Principal subsidiaries
√ Applicable □ Not applicable
Unit: RMB’0,000
Full
Registe
name of Operating
Principal activities red Total assets Net assets Net profit
subsidiar revenue
capital
y
Household appliances manufacturing;
manufacturing of mechanical and
electrical equipment; manufacturing
of distribution switch control
equipment; lighting apparatus
manufacturing; general
merchandising of hardware products;
electrical materials manufacturing;
manufacturing of electronic
components and electromechanical
components and equipment;
manufacturing of intelligent home
Ningbo
consumption equipment;
Gongniu
communication equipment 10,000 408,822.28 141,799.30 397,884.87 134,317.07
Electrics
manufacturing; network equipment
Co., Ltd.
manufacturing; IoT equipment
manufacturing; technical services,
technical development, technical
consulting, technical communication,
technical transfer, and technical
promotion (business activities shall
be conducted independently in
accordance with laws with the
business license, except the items that
require approval in accordance with
laws). Items permitted: Import and
export of products; and import and
Annual Report 2021
export of technologies (business
activities that require approval in
accordance with laws shall be subject
to the approval by relevant
authorities. Specific business items
are indicated on the approval results).
Ningbo
Gongniu
Manufacturing, processing and sales
Precisio
of mold, plastic products, hardware
n 10,000 84,080.80 14,783.30 277,083.95 3,508.58
accessories, and electronic
Manufac
components.
turing
Co., Ltd.
General merchandising, retailing and
online sales of electrical materials,
electronic products, hardware
products, household appliances,
communication apparatus, lamps, and
Ningbo
articles of everyday use; import and
Gongniu
export businesses of self-owned and 1,170,818.3
Electric 10,000 186,086.35 8,271.96 26,553.98
commissioned goods and 9
Sales
technologies (excluding those limited
Co., Ltd.
or prohibited by state laws and
regulations). (business activities that
require approval in accordance with
laws shall be subject to the approval
by relevant authorities)
Unit: RMB’0,000
Net profit
Full name of How it was Registered Closing net in the
Principal activities
subsidiary obtained capital assets current
period
Import and export of products; import and
export of technologies; import-export
agency services; and patent agency
(business activities that require approval in
accordance with laws shall be subject to the
approval by relevant authorities) General
items: Enterprise management; supply chain
management services; consultation planning
services; technical services, technical
Hainan development, technical consulting, technical
Dacheng communication, technical transfer, and
Supply technical promotion; human resource
Incorporated 1,000 -256.01 -1,934.04
Chain services (excluding job agency activities and
Management labor dispatch services); IT consultant
Co., Ltd. services; information consultant
services(excluding the information
consultant services requiring any license);
sales of electronic products; general
merchandising of hardware products; sales
of daily-use goods; sales of lamps; sales of
plastic products; sales of non-ferrous alloy;
sales of packaging materials and products;
sales of mechanical equipment; sales of
household appliances; sales of
Annual Report 2021
communication equipment; sales of office
equipment; sales of intelligent power
transmission and distribution and control
equipment; sales of engineering plastics and
synthetic resins (exclusive of licensing
businesses, independent operation of
businesses that are non-prohibited or non-
restricted by laws and regulations is
allowed)
Technical services, technical development,
technical consulting, technical
communication, technical transfer, and
technical promotion; manufacturing of
hardware products; manufacturing of
security protection equipment;
manufacturing of security protection
equipment; manufacturing of information
security equipment; lighting apparatus
manufacturing; development of artificial
intelligence application software;
information system operation and
maintenance services; technology consultant
services for the public service platform of
artificial intelligence; import and export of
Ningbo technologies; import-export agency; import
Gongniu and export of products; software
Intelligent development; manufacturing of distribution Incorporated 1,000 99.84 -0.16
Technology switch control equipment; manufacturing of
Co., Ltd. electronic components and
electromechanical components and
equipment; manufacturing of power
electronic devices and components;
communication equipment manufacturing;
manufacturing of metalwork for security
and fire control; manufacturing of intelligent
home consumption equipment; furniture
instalment and repairing services; instalment
services of household appliances; repairing
of electrical equipment; repairing of
metalwork (business activities shall be
conducted independently in accordance with
laws with the business license, except the
items that require approval in accordance
with laws).
(VIII) Structured entities controlled by the Company
□ Applicable √ Not applicable
VI Discussion and Analysis on the Company’s Futrue Development
(I) Industry landscape and trends
√ Applicable □ Not applicable
Data from the National Bureau of Statistics show that in 2021, China’s GDP increased by 8.1%
year on year; the sales area of commercial housing in China was 1,794.33 million square meters, a year-
on-year increase of 1.9%; sales reached RMB18,193 billion, an increase of 4.8% year on year. In 2021,
the nationwide per capita disposable income of residents reached RMB35,128, an increase of 8.1% year
on year; the per capita residential consumption expenditure was RMB5,641, a year-on-year increase of
Annual Report 2021
steady growth of over 8%. At the same time, the Government Work Report points out that in 2022, it is
significant to strive to meet people's housing needs, support the commercial housing market to better
meet the reasonable housing needs of buyers, keep the prices of land and housing as well as market
expectations stable, and promote a virtuous circle and healthy development of the housing market by
adopting city-specific policies. It is expected that the steady growth of the national economy and the
smooth operation of the real estate industry can provide a sound environment for the Company's
sustained and healthy development.
The domestic lighting market size is more than RMB200 billion, but the industrial pattern is
scattered. Under the dual influence of the pandemic and rising prices of bulk raw materials, small and
medium-sized lighting enterprises are facing greater survival pressure while the advantages of leading
enterprises become more prominent. With the popularization of LED lighting technology, consumers
pay more attention to luminous efficiency and light quality. Intelligent transformation has become the
direction of revolution in the next stage of the lighting industry. Gongniu will integrate consumers'
pursuit of minimalist decorating style to increase its business on smart no-main-lamp lighting products
and quickly improve its ability of key lines through internal technology research and development and
the integration of external resources to grasp the opportunities brought by intelligent transformation and
make breakthroughs.
With the increasing maturity of smart home solutions on the supply side and the gradual increase of
consumer acceptance on the demand side, the smart home industry is moving forward from the stage of
single smart product to the stage of whole-house intelligence. According to the monitoring data of
Aowei Cloud Network, in 2021, the scale of refined decoration projects supporting smart homes in
China's residential real estate reached 2.547 million sets, and the smart home configuration rate reached
rapid development of smart homes. The Company's smart ecosystem-based single products have been
launched constantly. Accelerating the promotion of whole-house smart home ecosystem with no-main-
lamp lighting products as the core will be the Company's next key development direction.
Association of Automobile Manufacturers, in 2021, the sales of new energy vehicles in China amounted
to 3.521 million, a year-on-year increase of 1.6 times, taking 13.4% of the total vehicle sales, compared
with a share of 5.4% in 2021. According to the New Energy Automobile Development Plan (2021-2035)
issued by the General Office of the State Council, by 2025, the sales of new energy vehicles will reach
about 20% of the total sales of new vehicles, and by 2035, pure electric vehicles will become the
mainstay of new sales vehicles, and all vehicles used for public services will be electrically powered.
With the support of policies and technologies, the new energy vehicle industry in China will accelerate
its growth. The Company will keep up with the development trend of the industry and quickly arrange
new energy vehicle charging plugs and charging points, which has achieved a good momentum. In the
future, the Company will accelerate technical reserves and product innovation based on its existing new
Annual Report 2021
energy vehicle charging plugs and charging points, actively explore new business, and seize the
historical opportunities for the development of the new energy industry.
With the popularization and upgrading of smart devices, consumers have put forward higher
requirements for the battery life of these devices. As the battery capacity of smart devices gradually
increases, the slow charging speed has become the biggest pain point for consumers. Fast charging
technology can complete charging in a short time, providing consumers with a better charging
experience, and therefore, it will become the new trend in the future. In addition, as the popularity of
outdoor leisure activities and the need for emergency power supply in case of natural disasters continue
to grow, the market of portable energy storage products expands rapidly and is developing towards high
power, light weight, and intelligence. The Company's digital accessories segment will focus on fast
charging products and portable energy storage products to speed up the business layout.
(II) Development strategies of the Company
√ Applicable □ Not applicable
With the vision of “Becoming a Leader in the International Civil Electric Industry”, the Company
will grasp the opportunities brought by consumption upgrading, intelligent transformation, and new
energy. To be specific, it will focus on smart ecosystem and new energy, lay out its business plan based
on its core advantages, and build the whole-house smart ecosystem with no-main-lamp lighting products
as the core, while contributing to the development of the new energy industry by providing consumers
with more and better electrical products and services.
(III) Business plans
√ Applicable □ Not applicable
In order to achieve its operating goals in 2022, the Company will work on the following priorities:
Company will continue to focus on customer needs to drive scenario-based and individualized
innovation so as to provide consumers with electric connection products for home, office, commercial
and other specific scenarios and strengthen its position as a leader and expert in power strips. The
Company will focus on new electrical appliances for the layout of electric connection products and
technical reserves, accelerate the arrangement of new energy vehicle charging plugs and charging points
in the field of new energy electric connection, and enrich product lines quickly to meet the demand
brought by the rapid increase of new energy vehicles in urban and rural markets. The Company will also
leverage its comprehensive advantages in products, channels, supply chain, and brand to strive to
provide consumers with quality, reliable, and safe products. Moreover, the Company will speed up the
research and development of cutting-edge technologies in the fields of fast charging and storage
charging to provide consumers with more and better electrical products and services.
consumption upgrade for home improvement and put forward the whole-house smart home solutions
with no-main-lamp lighting products as the core. As for wall switches and sockets, the Company will
further cultivate the decorative product line and at the same time, produce switches that match the no-
main-lamp lighting products. It will also quickly arrange smart products and lead the consumption
Annual Report 2021
upgrade of the industry as a whole. The lighting business will continue to enrich the basic lighting
product line and produce decorative lighting products for different market needs; the light source
business will focus on such subdivided fields as outdoor, office, and commercial chain to further lay out
the product line; no-main-lamp lighting products' core function is to provide consumers with a
comfortable light space and the business of no-main-lamp lighting products will be promoted; mobile
lighting will focus on the writing scenario and provide consumers with eye-caring lamps that are “eye-
friendly and ghosting-free”. In terms of domestic electrical appliances, the Company will focus on such
dimensions as intelligent transformation and scenario expansion to advance product innovation and lead
the development of the industry through innovation and quality. The circuit breaker business will remain
safety-oriented, continuously research and develop and manufacture products based on new technology
platforms, develop and improve power distribution and industrial control product lines to expand sales
channels and customer groups. The smart ecosystem business will focus on "Cloud-Edge-End" to
continue to research and develop and integrate resources, strengthen the supporting role of the Bull
Cloud platform for various businesses, optimize smart interactive experience, and leverage its
comprehensive advantages in products, channels, supply chain, and brand to accelerate the construction
of the whole-house smart ecosystem with no-main-lamp lighting products as the core.
focus on such categories as digital fast charging and outdoor power supply to create a fine-looking fast
charging series equipped with advanced technology, and at the same time, take outdoor power supply as
a starting point to accelerate the development and arrangement of outdoor energy storage business.
of the specialty stores and comprehensive stores, focus on digging deep into lower-tier markets, and at
the same time, establish the luminous efficiency design capability system of smart no-main-lamp
lighting products and distributor market planning and after-sales installation capability system. The
Company will strengthen the efforts to expand business-side channels, build a professional business-side
service provider system, quickly penetrate into home improvement, engineering and real estate
businesses through multi-category and systematic product solutions to create benchmark projects; use e-
commerce channels to keep up with changes in consumer buying habits, improve product planning
abilities, strengthen efforts in digital marketing, and increase the exposure frequency and conversion rate
of various traffic platforms to promote the coordinated development of all categories. At the same time,
the CRM+AI system will be covered for distributors to improve the digital management ability of
distributors and retail stores.
its brand power on the basis of its existing advantages in product power and channel power. While
continuing to consolidate and strengthen its leading role in industries of safety sockets and decorative
switches, it will also enhance consumer awareness and enrich brand connotation in more new categories.
impact caused by sharp fluctuations in raw materials; further tap its advantages in electronics, hardware,
Annual Report 2021
and mold components to continue to empower itself using technology; promote digital transformation,
construct an end-to-end supply chain system, and promote the coordinated cooperation of research,
production, and sales; continue to implement the cloud warehouse project, gain insight into market
changes, optimize the coordination of production and sales, and improve the comprehensive
competitiveness of the supply chain.
chain business management system, and achieve the overall improvement of the Company's product
power, sales power, and brand power. Further, it will strengthen the construction of talent teams and the
innovation of organizational mechanisms, move close to talent-gathering cities, effectively integrate the
advantages of talents, technology, and supply chain, and continuously improve the business innovation
capability and value creation capability.
(IV) Possible risks
√ Applicable □ Not applicable
Domestic and overseas political and economic environments are undergoing profound changes. The
main products of the Company are consumer goods widely used at home, office, and other places
needing electricity. The cyclical fluctuation of economy will directly influence the actual discretionary
income of consumers, consumers' income structure, and the consumer confidence index. Then,
consumers' demand for consumer goods including electric connection products, smart electrical lighting
products, and digital accessories will be influenced. If the growth rate of the domestic macroeconomy is
sluggish or slides, it will lead to a decrease in discretionary income and the power of consumption of
residents. It will also decrease consumers' demand and purchasing capacity for the Company's products.
As a result, the business development and the growth of results of the Company.
The civil electrical industry demonstrates full market competition. There are not only many
domestic enterprises, but also some famous international brands. Meanwhile, adaptors, wall switches
and sockets, and other products, as the main controlled entrance of future smart home, also have
attracted many powerful new enterprises to join in the competition. In the future, the civil electrical and
lighting industry is expected to remain its relatively fierce competition. There are uncertainties in the
changes of market competition. If the Company cannot adapt to the new competition situation, intensify
and expand its original competition advantages, it will face the risk of losing market shares.
At the time of intensifying and expanding the original competition advantages, centering on the
scenarios of electric vehicle charging and home decoration, the Company developed new business such
as charging plugs/points, circuit breakers, bathroom heaters, smart door locks, smart clothes drying racks,
and smart curtain machines. However, considering uncertain factors including the development trend,
market competition, and changes of consumer preferences in relevant fields, the possibility that the
development of new businesses will fail to reach expectation cannot be excluded.
Annual Report 2021
According to the differences and changes of consumers' purchasing habits, the Company continued
to improve the layout of channels, and vigorously extended the business-side business channel with
decoration companies as the core. However, the overlap of this channel and current competitive channels
is relatively low. The possibility that the development of new channels will fail to reach expectation
cannot be excluded.
The main materials that the Company needs for production are copper, plastic, assembly, hardware,
packaging materials, electronic parts, etc. There is certain relevance between the procurement prices of
raw materials and the prices of bulk commodities such as copper and plastic. The procurement prices of
raw materials have a relatively big impact on the cost of sales of the Company. If the procurement prices
of raw materials rise significantly or fluctuate sharply in the future, it will be harmful to the cost control
of the Company and then influence the Company's results.
There is a small amount of undue loans for some real estate enterprises in other receivables of the
Company. The Company has disclosed it in the periodic report and the bad debt provision has been
accrued with prudence. The possibility that such receivables will not be recovered cannot be excluded.
(V) Other information
□ Applicable √ Not applicable
VII Explanation of circumstances and reasons for non-disclosure by the company inconsideration
of inapplicable regulations,state secrets and commercial secrets.
□ Applicable √ Not applicable
Part IV Corporate Governance
I Overview of Corporate Governance
√ Applicable □ Not applicable
In accordance with the requirements of the Company Law, the Securities Law, the Code of
Corporate Governance for Listed Companies and other relevant national laws and regulations, and based
on the business development, the Company has established a governance structure consisting of the
General Meeting of Shareholders, the Board of Directors, the Supervisory Committee and the Senior
Management, and formed a mechanism of mutual coordination and checks and balances among the
authority, decision-making body, supervisory body and the management to promote modern corporate
governance and system building.
In accordance with the relevant laws and regulations and the Articles of Association, the Company
has formulated policies such as the Rules of Procedure of the General Meeting of Shareholders, the
Rules of Procedure of the Board of Directors, the Rules of Procedure of the Supervisory Committee, the
Work Policy for Independent Directors, the Working Rules for the Board Secretary, the Working Rules
for the General Manager (President), the Related-Party Transaction Management System, Foreign
Investment Management System and the External Guarantee Management System, and amended the
Annual Report 2021
Articles of Association during the Reporting Period to comply with the latest laws and regulations and
further improve the management level.
(I) General Meeting of Shareholders
The General Meeting of Shareholders of the Company has clear duties and rules of procedure,
which are effectively implemented. The procedures for convening, holding and proposing the General
Meeting of Shareholders of the Company are in line with laws and regulations and the Company's
internal systems and other relevant regulations.
(II) Directors and the Board of Directors
The duties of the Board of Directors of the Company are clear and all directors are able to perform
their duties conscientiously and responsibly. The procedures for convening and holding the meeting of
the Board of Directors are in line with relevant laws, regulations and systems.
During their tenure, all directors were diligent and attended the meeting of the Board of Directors
conscientiously and responsibly. They were familiar with the relevant laws and regulations, and able to
fully exercise and perform their rights, obligations and responsibilities as directors, safeguarding the
legitimate rights and interests of the Company and all shareholders.
In order to meet the needs of the Company's development, the Company has set up specialized
committees under the Board of Directors, including the Strategy Committee, Nomination Committee,
Remuneration and Appraisal Committee and Audit Committee. Except for the Strategy Committee, all
other specialized committees are chaired by independent directors, who play an important role in the
performance of major decision-making and monitoring functions by the Board of Directors, making the
Company's decision-making more efficient, standardized and scientific.
(III) Supervisors and the Supervisory Committee
The duties of the Supervisory Committee of the Company are clear and all supervisors are able to
perform their duties conscientiously and responsibly. The procedures for convening and holding the
meeting of the Supervisory Committee are in line with relevant laws, regulations and systems.
During the tenure, the Supervisors were diligent, actively attended the meetings of the Supervisory
Committee of the Company and performed their duties conscientiously. In line with the attitude of being
responsible to shareholders, they supervised the financial affairs of the Company as well as the legality
and compliance of the performance of duties by directors and senior management personnel of the
Company, and safeguarded the legitimate rights and interests of the Company and all shareholders.
In addition, the Company has established a relatively sound internal management and control
system, and has formulated relevant management systems in the areas of technology research and
development, procurement management, safe production, marketing management, quality control and
financial accounting. It conducted internal audit and supervision of the organization and management,
operating activities, financial revenues and expenditures and economic benefits of its subsidiaries, and
regularly inspected and evaluated the establishment and implementation of its internal control system to
ensure the effectiveness of internal control.
Annual Report 2021
Indicate whether there was any material incompliance with the applicable laws and regulations, as well
as the CSRC’s requirements in corporate governance. If yes, please explain.
□ Applicable √ Not applicable
II Specific Measures Taken by the Controlling Shareholder and Actual Controller to Guarantee
the Asset, Personnel, Financial, Organizational and Business Independence of the Company, as
well as Solutions, Progress and Subsequent Plans when the Company’s Independence Is
Intervened
√ Applicable □ Not applicable
The Company is independent of its controlling shareholder in assets, personnel, finance, organization,
business, etc.
Indicate whether the controlling shareholder, the actual controller, or any entity under their control is
engaged in the same or similar business with the Company. Please explain the impact of horizontal
competition or any significant change to horizontal competition on the Company, solutions taken,
progress and subsequent plans.
□ Applicable √ Not applicable
III General Meetings of Shareholders
Index to disclosed Disclosure
Meeting Date Resolutions
resolutions date
The Proposal on the Change of Registered Capital and
Amendment to the Articles of Association, Proposal on
the Election of Non-Independent Directors of the
The First
Second Board of Directors of the Company, Proposal
Extraordi
on the Election of Independent Directors of the Second
nary
Board of Directors of the Company and Proposal on
General
Meeting
of
approved by the resolution. For details, please refer to
Sharehol
the Announcement on the Resolutions of the First
ders of
Extraordinary General Meeting of Shareholders of
Company on the website of the Shanghai Stock
Exchange.
The Proposal on the Work Report of the Board of
Directors in 2020, Proposal on the Work Report of the
Supervisory Committee in 2020, Proposal on the
Financial Final Account Report of 2020, Proposal on
the Annual Report and its Summary for 2020, Proposal
on the Profit Distribution Plan for 2020, Proposal on
the Renewal of the Annual Auditor for 2021, Proposal
on the Use of Equity Funds for Entrusting Wealth
The 2020 Management, Proposal on the Compensation Scheme
Annual for Directors, Proposal on the Compensation Scheme
General for Supervisors, Proposal on the Restricted Share
Meeting Incentive Scheme for 2021 (Draft Revised) and its
of Summary, Proposal on the Management Measures for
Sharehol the Assessment of the Restricted Share Incentive
ders Scheme for 2021 (Revised), Proposal on the Request to
the General Meeting to Authorize the Board of
Directors to Handle Share Incentive-Related Matters,
Proposal on the Change of Registered Capital and
Amendment to the Articles of Association and Proposal
on the Election of Non-Independent Directors of the
Second Board of Directors of the Company were
approved by the resolution. For details, please refer to
the Announcement on the Resolutions of the 2020
Annual Report 2021
Annual General Meeting of Shareholders
(Announcement No.: 2021-048) published by the
Company on the website of the Shanghai Stock
Exchange.
The
The Proposal on Changing Some Investment Projects
Second
with Raised Funds and Proposal on the Change of
Extraordi
Registered Capital and Amendment to the Articles of
nary
General http://www.sse.co
November November details, please refer to the Announcement on the
Meeting m.cn
of
Meeting of Shareholders of 2021 (Announcement No.:
Sharehol
ders of
the Shanghai Stock Exchange.
Extraordinary general meetings of shareholders convened at the request of preference shareholders with
resumed voting rights:
□ Applicable √ Not applicable
Notes to general meetings of shareholders:
√ Applicable □ Not applicable
On 7 January 2021, the Company held the First Extraordinary General Meeting of Shareholder of
of Association, elect the directors of the Second Board of Directors of the Company and elect the non-
employee supervisors of the Second Supervisory Committee of the Company.
On 20 May 2021, the Company held its 2020 Annual General Meeting of Shareholders, and
deliberated and approved the proposals on the work report of the Board of Directors, the work report of
the Supervisory Committee, the financial final accounts, the 2020 annual report, the profit distribution
plan, the renewal of the annual auditor, the entrustment of wealth management with equity funds, the
remuneration scheme for directors and supervisors, the restricted share incentive scheme and the
amendment to the Articles of Association of the Company.
On 15 November 2021, the Company held the Second Extraordinary General Meeting of
Shareholders of 2021, and deliberated and approved the proposal to change some investment projects
with raised funds and amend the Articles of Association of the Company.
For details, please refer to the Announcement on the Resolutions of the First Extraordinary General
Meeting of Shareholders of 2021 (Announcement No.: 2021-001), the Announcement on the Resolutions
of the 2020 Annual General Meeting of Shareholders (Announcement No.: 2021-048) and the
Announcement on the Resolutions of the Second Extraordinary General Meeting of Shareholders of 2021
(Announcement No.: 2021-102) published by the Company on the website of the Shanghai Stock
Exchange (http://www.sse.com.cn).
Annual Report 2021
IV Directors, Supervisors and Senior Management
(I) Shareholding changes and remunerations of incumbent directors, supervisors and senior management and those who resigned before the end of their
tenures during the Reporting Period
√ Applicable □ Not applicable
Unit: share
Total pre-tax
remuneration
Change in received Remuneration
shareholding from the received from
Opening Closing
Office title Start of End of in the Reason for Company in any of the
Name Gender Age shareholding shareholding
(note) tenure tenure Reporting change the Company’s
(share) (share)
Period Reporting related parties
(share) Period (yes/no)
(RMB’
Chairman of
Ruan 2017-12- Not
the Board Male 58 2024-1-6 96,864,199 96,864,199 0 301.12 No
Liping 23 applicable
and President
Vice
Ruan 2017-12- Not
Chairman of Male 50 2024-1-6 96,864,199 96,864,199 0 248.00 No
Xueping 23 applicable
the Board
Director and Grant of
Cai 2017-12-
Vice Male 59 2024-1-6 12,500 25,300 12,800 equity 247.12 No
Yingfeng 23
President incentives
Director,
Vice
Liu 2017-12- Not
President and Male 52 2024-1-6 18,800 18,800 0 284.04 No
Shengsong 23 applicable
Board
Secretary
Director and
Zhou 2017-12- Not
Vice Male 50 2024-1-6 13,100 13,100 0 361.42 No
Zhenghua 23 applicable
President
Zhou 2021-5- Not
Director Female 38 2024-1-6 0 0 0 - No
Wenchuan 20 applicable
Annual Report 2021
Independent 2017-12- Not
Xie Tao Male 59 2024-1-6 0 0 0 10.00 No
Director 23 applicable
Zhang Independent 2017-12- Not
Male 49 2024-1-6 0 0 0 10.00 No
Zeping Director 23 applicable
Independent 2017-12- Not
He Hao Female 46 2024-1-6 0 0 0 10.00 No
Director 23 applicable
Chairman of
Shen the 2017-12- Not
Male 58 2024-1-6 0 0 0 252.94 No
Huiyuan Supervisory 23 applicable
Committee
Guan 2017-12- Not
Supervisor Male 44 2024-1-6 0 0 0 189.81 No
Xuejun 23 applicable
Employee 2017-12- Not
Li Yu Male 39 2024-1-6 0 0 0 92.21 No
Supervisor 23 applicable
Grant of
Li Vice 2017-12-
Male 55 2024-1-6 13,800 24,400 10,600 equity 268.31 No
Guoqiang President 23
incentives
Vice
Zhang 2017-12- Not
President and Female 62 2024-1-6 7,500 7,500 0 161.66 No
Lina 23 applicable
CFO
Director 2017-12- 2021-4- Not
Cao Wei Male 44 0 0 0 - No
(former) 23 12 applicable
Total / / / / / 193,794,098 193,817,498 23,400 / 2,436.63 /
Name Main work experience
Born in 1964, Bachelor's degree, Chinese nationality, with permanent residence in Singapore and a Hong Kong Identity Card. He once served as an
engineer at Hangzhou Mechanical Design Institute of the Ministry of Water Resources, and Chairman of the Board and President of Gongniu Group
Co., Ltd. (the former private company). He is currently the Chairman of the Board and President of Gongniu Group and a member of the 13th
Ruan Liping
National People's Congress of Zhejiang Province, and mainly concurrently the Executive Director and General Manager of Ningbo Gongniu, the
Executive Director and General Manager of Gongniu Photoelectric, the Executive Director and General Manager of Gongniu Digital and the
Executive Director of Liangji Industrial.
Born in 1972, junior secondary education, Chinese nationality, with permanent residence in Singapore and a Hong Kong Identity Card. He once
Ruan
served as the Production Manager of Cixi Gongniu, Vice Chairman of the Board of Gongniu Group Co., Ltd. (the former private company). He is
Xueping
currently the Vice Chairman of the Board of Gongniu Group, and mainly concurrently the Executive Director of Cixi Gongniu, the General
Annual Report 2021
Manager of Shanghai Gongniu and the Supervisor of Liangji Industrial.
Born in 1963, Bachelor's degree, professor-level senior engineer, Chinese nationality, with permanent residence in Singapore. He once served as the
Director Engineer of the Crane Room of Hangzhou Mechanical Design Institute of the Ministry of Water Resources, Senior Engineer of Portek
Cai Yingfeng
International Pte Ltd (Singapore), Vice President and Chief Engineer of Gongniu Group Co., Ltd. (the former private company). He is currently a
director and Vice President of Gongniu Group.
Born in 1970, Bachelor's degree, engineer, Chinese nationality, no permanent residence abroad. He once served as the Director's Assistant of the
Science and Technology Department of Kmk Group, Senior Manager of Midea Group Co., Ltd., Director of strategic operations and Deputy
Liu
General Manager of the Business Division of AUX Group Co., Ltd., President's Assistant and General Manager of the Business Division of Jiangxi
Shengsong
Zhengbang Technology Co., Ltd., and Vice President of Gongniu Group Co., Ltd. He is currently a director, Vice President and Board Secretary of
Gongniu Group, with the professional qualification of Board Secretary of the Shanghai Stock Exchange.
Born in 1972, Master's degree, Chinese nationality, no permanent residence abroad. He once served as a technician of incoming material quality
Zhou control (IQC) at Zhongshan Kawa Electronic(Group)Co., Ltd., the Managing Officer of quality control (QC) at One Earth Group Limited, General
Zhenghua Manager of the product company of Midea Group Co., Ltd., and Vice President of Gongniu Group Co., Ltd. (the former private company). He is
currently a director, Vice President and General Manager of the Wall Opening Division of Gongniu Group.
Born in 1983, Master's degree, Ph.D. in progress, permanent resident of Hong Kong. She is currently the Vice Chairman and President of Meilleure
Zhou
Health International Group, Assistant President of U-Home Group, General Manager of Shenzhen Xiaozhou Investment Co., Ltd., and a member of
Wenchuan
the Standing Executive Committee of Shenzhen Federation of Industry & Commerce (Chamber of Commerce), and a director of Gongniu Group.
Born in 1983, Bachelor's degree, member of the Institute of Chartered Accountants, Singaporean nationality. He once served as a partner of PwC,
the Chief Executive Officer of Agria Corporation, a partner of Ernst & Young, and the Chief Executive Officer of Hunan Dakang International
Xie Tao
Food & Agriculture Co., Ltd. He is currently a director of Shanghai Vico Precision Mold &Plastics Co., Ltd., an independent director of China
Yuchai International Limited, Zhejiang Wanfeng Auto Wheel Co., Ltd. and Gongniu Group.
Born in 1973, doctoral degree, Chinese nationality, no permanent residence abroad. He once served as a teacher at the School of Basic Education of
Shanghai University of Engineering Science, a teacher at the School of International Law of East China University of Political Science and Law,
and the Director of the Consular Department of the China Embassy in Macedonia. He is currently a professor at the School of International Law of
Zhang
East China University of Political Science and Law, an arbitrator of Shanghai International Economic and Trade Arbitration Commission (SHIAC),
Zeping
Shanghai Arbitration Commission and Shenzhen Court of International Arbitration, a part-time lawyer of Shanghai Zhonglian Law Firm, an
independent director of Kunshan Xiefu New Material Co., Ltd., an independent director of Shenzhen Soocas Technology Co., Ltd., a director of
Suzhou Kelinyuan Electronics Co., Ltd. and an independent director of Gongniu Group.
Born in 1976, Master's degree, Chinese nationality, no permanent residence abroad. He once served as a senior auditor of Arthur Andersen LLP, an
audit manager of PwC LLP, Vice President of Deutsche Bank (China) Co., Ltd., and Chief Controller of the Corporate Customer Department of
Standard Chartered Bank (China) Limited. He is currently the Executive President of Red Star Macalline Holding Group Co., Ltd., Chairman of
He Hao Shanghai Xingshan Investment Management Co., Ltd., a managing partner of Shanghai Xingduo Investment Partnership Enterprise (Limited
Partnership), executive director of Shanghai Xingdun Technology Co., Ltd., an executive director of Shanghai Xingyuxin Business Management
Co., Ltd., executive director and manager of Beijing Xinghao Kairui Technology Co., Ltd., executive director of Shanghai Lihao Creative Design
Co., Ltd., director of Shanghai Meilong Interactive Entertainment Technology Co., Ltd., director of Chongqing Meiji Financial Leasing Co., Ltd.,
Annual Report 2021
director of Shanghai Xingduo Hotel Management Co., Ltd., supervisor of Tibet Yiying Enterprise Management Co., Ltd., supervisor of Changzhou
Yinghong Investment Co., Ltd., supervisor of Shanghai Jiajinsuo Financial Information Service Co., Ltd., supervisor of Shanghai Xingqin Brand
Management Co., Ltd. and independent director of Gongniu Group.
Born in 1964, Bachelor's degree, Chinese nationality, no permanent residence abroad. He once served as the project leader of the International
Electrical Development Department of TCL Group Co., Ltd, head of the Electrical R&D Department of Huizhou IDV Electrical Technology Co.,
Shen Ltd., head of Electrical Accessories Department of Gongniu Group Co., Ltd. (the former private company), Executive Deputy General Manager and
Huiyuan Deputy General Manager of R&D of Ningbo Gongniu Electrics Co., Ltd., and Director of the Research Institute of Gongniu Group Co., Ltd. (the
former private company). He is currently the Chairman of the Supervisory Committee of Gongniu Group Co., Ltd., head of the R&D and
Technology Management Center and Director of the Research Institute of Gongniu Group.
Born in 1978, Master's degree, Chinese nationality, no permanent residence abroad. He once served as the procurement manager of Foshan Shunde
District MiTAC Computer (Shunde) Limited, senior procurement manager of Ningbo Franta Kitchenware Co., Ltd., senior procurement manager of
Guan Xuejun
Quanyou Furniture Co., Ltd., and Director of the New Business Management Center of Gongniu Group Co., Ltd. (the former private company). He
is currently a supervisor of Gongniu Group and the General Manager of the decoration channel marketing system.
Born in 1983, Bachelor's degree, intermediate auditor, international certified internal auditor, Chinese nationality, no permanent residence abroad.
He once served as the Manager of the Audit Department, Manager of the Operation Department, Executive President of Gongniu University and
Li Yu
Director of Human Resources Center of Gongniu Group Co., Ltd. (the former private company). He is currently the General Manager of the Low-
voltage Electrical Appliances Division of Gongniu Group.
Born in 1967, junior college degree, Chinese nationality, no permanent residence abroad. He once served as the Regional Manager of TCL
Li Guoqiang International Electrical (Huizhou) Co., Ltd., Marketing Director of IDV International Electrical (Huizhou) Co., Ltd. and Vice President of
Marketing of Gongniu Group Co., Ltd. (the former private company). He is currently the Vice President of Marketing of Gongniu Group.
Born in 1960, junior college degree, Chinese nationality, no permanent residence abroad. She once served as the Finance Controller of China
Zhang Lina Telecom Co., Ltd. Cixi Branch, Financial Manager and Chief Financial Officer of Gongniu Group Co., Ltd. (the former private company). She is
currently the Vice President and Chief Financial Officer of Gongniu Group.
Other information:
□ Applicable √ Not applicable
Annual Report 2021
(III) Offices held by incumbent directors, supervisors and senior management and those who resigned before the end of their tenures during the Reporting
Period
√ Applicable □ Not applicable
Office held in the shareholding
Name Shareholding entity Start of tenure End of tenure
entity
Ruan Liping Ningbo Liangji Industrial Co., Ltd. Executive Director November 2011 Currently ongoing
Ruan Xueping Ningbo Liangji Industrial Co., Ltd. Supervisor November 2011 Currently ongoing
Note Not applicable
√ Applicable □ Not applicable
Name Other entity Office held in other entity Start of tenure End of tenure
Ruan Executive Director and
Ningbo Gongniu Electrics Co., Ltd. December 2008 Currently ongoing
Liping General Manager
Ruan
Cixi Gongniu Electrics Co., Ltd. General Manager January 2008 Currently ongoing
Liping
Ruan Executive Director and
Ningbo Gongniu Digital Technology Co., Ltd. October 2016 Currently ongoing
Liping General Manager
Ruan Executive Director and
Ningbo Gongniu Precision Manufacturing Co., Ltd. September 2015 Currently ongoing
Liping General Manager
Ruan Executive Director and
Ningbo Bull International Trading Co., Ltd. March 2017 Currently ongoing
Liping General Manager
Ruan Ningbo Gongniu Supply Chain Management Co., Executive Director and
December 2016 Currently ongoing
Liping Ltd. General Manager
Ruan
Ningbo Gongniu Electric Sales Co., Ltd. Executive Director August 2017 Currently ongoing
Liping
Ruan
Ningbo Xingluo Trading Co., Ltd. Executive Director August 2017 Currently ongoing
Liping
Ruan Executive Director and
Ningbo Gongniu Photoelectric Technology Co., Ltd. June 2014 Currently ongoing
Liping General Manager
Ruan Executive Director and
Ningbo Gongniu Low Voltage Electric Co., Ltd. June 2019 Currently ongoing
Liping Manager
Ruan Shanghai Minshen Property Co., Ltd. Vice Chairman of the Board July 1999 Currently ongoing
Annual Report 2021
Liping
Ruan
Wuhan Gongniu Investment Management Co., Ltd. Chairman of the Board August 2011 October 2021
Liping
Ruan
Cixi Shenghui Electronics Co., Ltd. Executive Director January 2016 Currently ongoing
Liping
Ruan
Ningbo Gongniu Property Co., Ltd. Executive Director June 2010 Currently ongoing
Liping
Ruan
Ningbo Golden Mango Ecological Manor Co., Ltd. Executive Director December 2013 Currently ongoing
Liping
Ruan
Wuhan Gongniu Ventures Investment Co., Ltd. Chairman of the Board October 2011 March 2021
Liping
Ruan
Ningbo Fenggu Real Estate Co., Ltd. Director April 2011 January 2022
Liping
Ruan
Cixi Golden Mango Microcredit Co., Ltd. Chairman of the Board June 2012 April 2021
Liping
Ruan
Qingdao Haili Commercial Appliances Co., Ltd. Director May 2009 Currently ongoing
Liping
Ruan
Wuhan Fenjin Power Tech Co., Ltd. Executive Director December 2006 Currently ongoing
Liping
Ruan Ningbo Meishan Bonded Port Shuojin Investment
Executive Director November 2017 Currently ongoing
Liping Management Co., Ltd.
Ruan Wuhan Zhongjia Hongyi Technology Information
Director January 2019 Currently ongoing
Liping Industrial Park Co., Ltd.
Ruan Ningbo Gongniu Domestic Electrical Appliance Co., Executive Director and
April 2020 Currently ongoing
Liping Ltd. Manager
Ruan Executive Director and
Shanghai Gongniu Information Technology Co., Ltd. February 2022 Currently ongoing
Liping General Manager
Ruan Executive Director and
Ningbo Gongniu Smart Technology Co., Ltd. October 2021 Currently ongoing
Liping Manager
Ruan Ningbo Meishan Bonded Port Shuojin Investment
Supervisor November 2017 Currently ongoing
Xueping Management Co., Ltd.
Ruan
Cixi Gongniu Electrics Co., Ltd. Executive Director January 1995 Currently ongoing
Xueping
Ruan
Shanghai Minshen Property Co., Ltd. Director July 1999 Currently ongoing
Xueping
Annual Report 2021
Ruan
Shanghai Dumin Real Estate Co., Ltd. Chairman of the Board March 2006 Currently ongoing
Xueping
Ruan
Wuhan Gongniu Investment Management Co., Ltd. Supervisor August 2011 October 2021
Xueping
Ruan
Shanghai Minshen Real Estate Management Co., Ltd. Director August 2005 Currently ongoing
Xueping
Zhou Vice Chairman of the Board
Meilleure Health International Group Co., Ltd. August 2013 Currently ongoing
Wenchuan and President
Zhou
U-Home Group Co., Ltd. Supervisor June 2010 Currently ongoing
Wenchuan
Zhou
Shenzhen Xiaozhou Investment Co., Ltd. General Manager January 2009 Currently ongoing
Wenchuan
Zhou
Yunnan Hansu Biotechnology Co., Ltd. Director June 2018 Currently ongoing
Wenchuan
Zhou
Shenzhen Yinguan Biological Technology Co., Ltd. Director February 2019 Currently ongoing
Wenchuan
Zhou
Shenzhen Meiray Vap Technology Co., Ltd. Chairman of the Board December 2019 Currently ongoing
Wenchuan
Zhou Zhuhai Fuhai Canyang Investment Development Co.,
Director December 2009 Currently ongoing
Wenchuan Ltd.
Zhou
Wuhu Meilleure Health Management Co., Ltd. General Manager April 2018 Currently ongoing
Wenchuan
Zhou
Shenzhen Skin Analysis Medical Beauty Clinic Chairman of the Board June 2017 Currently ongoing
Wenchuan
Zhou
Shenzhen Ruima Electric Technology Co., Ltd. General Manager September 2019 Currently ongoing
Wenchuan
Zhou
Beijing Meiaikang Technology Co., Ltd. Director February 2020 Currently ongoing
Wenchuan
Zhou
Wuhu Xiaozhou Investment Co., Ltd. General Manager October 2019 Currently ongoing
Wenchuan
Xie Tao Shanghai Vico Precision Mold &Plastics Co., Ltd. Director May 2021 Currently ongoing
Xie Tao China Yuchai International Limited Independent Director September 2020 Currently ongoing
Xie Tao Zhejiang Wanfeng Auto Wheel Co., Ltd. Independent Director June 2020 Currently ongoing
Zhang
Kunshan Xiefu New Material Co., Ltd. Independent Director June 2015 Currently ongoing
Zeping
Annual Report 2021
Zhang
Shenzhen Soocas Technology Co., Ltd. Independent Director October 2020 Currently ongoing
Zeping
Zhang
Suzhou Kelinyuan Electronics Co., Ltd. Director January 2022 Currently ongoing
Zeping
He Hao Red Star Macalline Holding Group Co., Ltd. CEO February 2017 Currently ongoing
Shanghai Xingduo Investment Partnership Enterprise
He Hao Executive Partner July 2018 Currently ongoing
(Limited Partnership)
Shenzhen Red Star Macalline Gaosheng City
He Hao Chairman of the Board March 2019 Currently ongoing
Industrial Development Co., Ltd.
He Hao Shanghai Xingyuxin Business Management Co., Ltd. Executive Director August 2018 Currently ongoing
Shanghai Xingshan Investment Management Co.,
He Hao Chairman of the Board February 2019 Currently ongoing
Ltd.
He Hao Shanghai Xingdun Technology Co., Ltd. Executive Director March 2018 Currently ongoing
He Hao Tibet Yiying Enterprise Management Co., Ltd. Supervisor June 2017 Currently ongoing
He Hao Changzhou Yinghong Investment Co., Ltd. Supervisor May 2017 Currently ongoing
Shanghai Jiajinsuo Financial Information Service
He Hao Supervisor May 2017 Currently ongoing
Co., Ltd.
Shanghai Meilong Interactive Entertainment
He Hao Director July 2017 Currently ongoing
Technology Co., Ltd.
He Hao Shanghai Xingqin Brand Management Co., Ltd. Supervisor August 2018 Currently ongoing
Shanghai Aegean Outlets Business Management Co.,
He Hao Supervisor September 2018 Currently ongoing
Ltd.
He Hao Chongqing Meiji Financial Leasing Co., Ltd. Director November 2017 Currently ongoing
Executive Director and
He Hao Beijing Xinghao Kairui Technology Co., Ltd. December 2018 Currently ongoing
Manager
He Hao Shanghai Xingduo Hotel Management Co., Ltd. Director May 2019 Currently ongoing
He Hao Shanghai Lihao Creative Design Co., Ltd. Executive Director July 2019 Currently ongoing
Liu
Wuhan Yangtze Optical Electronic Co., Ltd. Director January 2020 Currently ongoing
Shengsong
Liu
Wuhan Gongniu Investment Management Co., Ltd. Supervisor October 2021 Currently ongoing
Shengsong
Li Yu Ningbo Gongniu Electrics Co., Ltd. Supervisor December 2017 Currently ongoing
Li Yu Cixi Gongniu Electrics Co., Ltd. Supervisor December 2017 Currently ongoing
Li Yu Ningbo Gongniu Low Voltage Electric Co., Ltd. Supervisor June 2019 Currently ongoing
Annual Report 2021
Li Yu Ningbo Banmen Electric Appliance Co., Ltd. Supervisor December 2017 Currently ongoing
Li Yu Ningbo Gongniu Digital Technology Co., Ltd. Supervisor December 2017 Currently ongoing
Li Yu Ningbo Bull International Trading Co., Ltd. Supervisor December 2017 Currently ongoing
Ningbo Gongniu Supply Chain Management Co.,
Li Yu Supervisor December 2017 Currently ongoing
Ltd.
Li Yu Ningbo Gongniu Photoelectric Technology Co., Ltd. Supervisor December 2017 Currently ongoing
Li Yu Shanghai Gongniu Electrics Co., Ltd. Supervisor December 2017 Currently ongoing
Li Yu Ningbo Gongniu Precision Manufacturing Co., Ltd. Supervisor November 2019 Currently ongoing
Ningbo Gongniu Domestic Electrical Appliance Co.,
Li Yu Supervisor April 2020 Currently ongoing
Ltd.
Note Not applicable
(IV) Remunerations of directors, supervisors and senior management
√ Applicable □ Not applicable
Decision-making procedures for the The remuneration of directors and supervisors shall be deliberated and determined by the General Meeting of
remuneration of directors, supervisors and senior Shareholders. The remuneration of senior management personnel shall be reviewed and determined by the Board
management personnel of Directors.
Internal directors, supervisors and senior management personnel are paid remuneration in accordance with the
Basis for determining the remuneration of specific management positions they hold in the Company, taking into account the Company's business picture,
directors, supervisors and senior management relevant remuneration system and results of performance appraisals. The remuneration of independent directors
personnel is based on an allowance system, and directors who do not hold specific management positions in the Company
will not receive remuneration.
Actual payment of remuneration for directors, The earnings disclosed in the report represent the actual remuneration of the directors, supervisors and senior
supervisors and senior management personnel management personnel.
Total actual remuneration received by all
directors, supervisors and senior management RMB24,366,300
personnel at the end of the Reporting Period
(V) Changes of directors, supervisors and senior management
√ Applicable □ Not applicable
Name Office title Type of change Reason for change
Cao Wei Director Resignation Personal reasons
Zhou Wenchuan Director Elected Elected
Mr. Cao Wei, a former director of the Company, resigned as a director and a member of the Strategy Committee of the Board of Directors on 12 April 2021 for
personal reasons. Upon his resignation, Mr. Cao Wei no longer holds any position in the Company.
Annual Report 2021
Upon the deliberation and approval at the Third Meeting of the Second Board of Directors of the Company and the 2020 Annual General Meeting, and the
inspection of the Nomination Committee of the Board of Directors of the Company, the Board of Directors agreed to elect Mrs. Zhou Wenchuan as a non-
independent director of the Second Board of Directors and a member of the Strategy Committee of the Second Board of Directors.
(VI) Punishments imposed by securities regulators in the past three years
□ Applicable √ Not applicable
(VII) Other information
□ Applicable √ Not applicable
V Board Meetings Convened during the Reporting Period
Meeting Date Resolutions
Reviewed and approved the Proposal on the Election of the Chairman of the Board and Vice Chairman of the Board of
the Company, Proposal on the Election of Members of the Specialized Committee of the Board of Directors, Proposal on
the Appointment of the President, Board Secretary and Securities Representative of the Company, Proposal on the
The First
Appointment of the Vice President and Chief Financial Officer of the Company, Proposal on the Continued Use of Part of
Meeting of the
Second Board
Temporary Replenishment of Working Capital, Proposal on Conducting Bulk Raw Material Futures Business and
of Directors
Proposal on the Application for Comprehensive Credit Line from Banks. For details, please refer to the Announcement on
the Resolutions of the First Meeting of the Second Board of Directors (Announcement No.: 2021-002) published by the
Company on the website of the Shanghai Stock Exchange.
The Second
Reviewed and approved the Proposal on Estimated Continuing Related-Party Transactions for 2021. For details, please
Meeting of the
Second Board
No.: 2021-018) published by the Company on the website of the Shanghai Stock Exchange.
of Directors
Reviewed and approved the Proposal on the Work Report of the General Manager in 2020, Proposal on the Work Report
of the Board of Directors in 2020, Proposal on the Financial Final Account Report of 2020, Proposal on the Annual
Report and its Summary for 2020, Proposal on the Profit Distribution Plan for 2020, Proposals on the 2020 Annual
Internal Control Evaluation Report, Proposal on the Annual Social Responsibility Report, Proposal on the Work Report
The Third of Independent Directors for 2020, Proposal on the Report on the Performance of the Audit Committee of the Board of
Meeting of the Directors for 2020, Proposal on the Renewal of the Annual Auditor for 2021, Proposal on the Use of Equity Funds for
Second Board Entrusting Wealth Management, Proposal on the Compensation Schemes for Directors and Senior Management
of Directors Personnel, Proposal on the Restricted Share Incentive Scheme for 2021 (Draft) and its Summary, Proposal on the
Management Measures for the Assessment of the Restricted Share Incentive Scheme for 2021, Proposal on the Request to
the General Meeting to Authorize the Board of Directors to Handle Share Incentive-Related Matters, Proposal on
Adjusting Matters Related to the Special Talent Shareholding Plan for 2020, Proposal on Repurchase and Cancellation
of Some Restricted Shares, Proposal on the Change of Registered Capital and Amendment to the Articles of Association,
Annual Report 2021
Proposal on the Special Report on the Deposit and Actual Use of Raised Funds for 2020, Proposal on the 2021 Q1
Report, Proposal on the Election of Candidates for Non-Independent Directors of the Second Board of Directors of the
Company and Proposal on the Convening of the 2020 Annual General Meeting. For details, please refer to the
Announcement on the Resolutions of the Third Meeting of the Second Board of Directors (Announcement No.: 2021-024)
published by the Company on the website of the Shanghai Stock Exchange.
Reviewed and approved the Proposal on the Restricted Share Incentive Scheme for 2021 (Draft Revised) and its
The Fourth
Summary, Proposal on the Management Measures for the Assessment of the Restricted Share Incentive Scheme for 2021
Meeting of the
Second Board
details, please refer to the Announcement on the Resolutions of the Fourth Meeting of the Second Board of Directors
of Directors
(Announcement No.: 2021-040) published by the Company on the website of the Shanghai Stock Exchange.
The Fifth Reviewed and approved the Proposal on the Adjustment of the List of Incentive Targets, Grant Number and Grant Price
Meeting of the of the Restricted Share Incentive Scheme for 2021 and Proposal on Granting Restrictive Shares to Incentive Targets. For
Second Board details, please refer to the Announcement on the Resolutions of the Fifth Meeting of the Second Board of Directors
of Directors (Announcement No.: 2021-054) published by the Company on the website of the Shanghai Stock Exchange.
Reviewed and approved the Proposal on the Achievement of Lifting the Restriction Conditions in the First Lifting
The Sixth
Restriction Period of the 2020 Restricted Share Incentive Scheme and Proposal on the Adjustment of the Repurchase
Meeting of the
Second Board
the Sixth Meeting of the Second Board of Directors (Announcement No.: 2021-059) published by the Company on the
of Directors
website of the Shanghai Stock Exchange.
Reviewed and approved the Proposal on the Semi-Annual Report for 2021 and its Summary, Special Report on the
The Seventh
Deposit and Actual Use of Raised Funds for the Semi-Annual Period of 2021 and Proposal on the Formulation of
Meeting of the
Second Board
Announcement on the Resolutions of the Seventh Meeting of the Second Board of Directors (Announcement No.: 2021-
of Directors
Reviewed and approved the Proposal on the 2021 Q3 Report of the Company, Proposal on Changing Some Investment
The Eighth Projects with Raised Funds, Proposal on the Change of Registered Capital and Amendment to the Articles of Association,
Meeting of the Proposal on Repurchase and Cancellation of Some Restricted Shares and Proposal on the Convening of the Second
Second Board Extraordinary General Meeting of Shareholders of 2021. For details, please refer to the Announcement on the Resolutions
of Directors of the Eighth Meeting of the Second Board of Directors (Announcement No.: 2021-090) published by the Company on
the website of the Shanghai Stock Exchange.
Reviewed and approved the Proposal on the Continued Use of Part of Temporarily Idle Raised Funds for Cash
The Ninth
Management, Proposal on the Continued Use of Part of Idle Raised Funds for Temporary Replenishment of Working
Meeting of the
Second Board
Credit Line from Banks, Proposal on the Change of Registered Capital and Amendment to the Articles of Association and
of Directors
Proposal on the Convening of the First Extraordinary General Meeting of Shareholders of 2022. For details, please refer
Annual Report 2021
to the Announcement on the Resolutions of the Ninth Meeting of the Second Board of Directors (Announcement No.:
VI Performance of Duty by Directors
(I) Attendance of directors at board meetings and general meetings of shareholders during the Reporting Period
Attendance at
Attendance at board meetings general meetings of
shareholders
Independent
Name of Total number of Board Total number of
director or Board The director failed
director board meetings Board meetings meetings general meetings of
not meetings to attend two
the director was attended by way of attended Absence shareholders the
attended on consecutive board
supposed to telecommunication through a director was
site meetings (yes/no)
attend proxy supposed to attend
Ruan Liping No 9 9 4 0 0 No 3
Ruan Xueping No 9 9 5 0 0 No 3
Cai Yingfeng No 9 9 5 0 0 No 3
Liu Shengsong No 9 9 4 0 0 No 3
Zhou
No 9 9 5 0 0 No 3
Zhenghua
Zhou
No 5 5 5 0 0 No 1
Wenchuan
Xie Tao Yes 9 9 8 0 0 No 2
Zhang Zeping Yes 9 9 8 0 0 No 3
He Hao Yes 9 9 7 0 0 No 2
Cao Wei
No 2 2 2 0 0 No 0
(former)
Explain why any director failed to attend two consecutive board meetings.
□ Applicable √ Not applicable
Total number of board meetings convened in the
Reporting Period
Of which: on-site meetings 0
Meetings convened by way of telecommunication 4
Meetings where on-site attendance and attendance
by telecommunication were both allowed
Annual Report 2021
(II) Objections raised by directors on matters of the Company
□ Applicable √ Not applicable
(III) Other information
□ Applicable √ Not applicable
Annual Report 2021
VII Specialized Committees under the Board of Directors
√ Applicable □ Not applicable
(1) Members of the specialized committees
Specialized committee Members
Audit Committee He Hao (convener), Xie Tao, and Ruan Xueping
Nomination Committee Xie Tao (convener), Ruan Liping, and Zhang Zeping
Remuneration and
Zhang Zeping (convener), Ruan Liping, and He Hao
Appraisal Committee
Ruan Liping (convener), Liu Shengsong, Zhou Zhenghua, Zhou
Strategy Committee
Wenchuan, and Xie Tao
(2) The Audit Committee held five meetings during the Reporting Period.
Important comments and Other performance of
Date Contents
suggestions duties
The Audit Committee carried
out its work in strict
accordance with laws, For details, please refer to
regulations and relevant rules the Report of Gongniu
Reviewed and approved
and policies with diligence. It Group Co., Ltd. On the
put forward relevant opinions Duty Performance of the
based on the reality of the Audit Committee of the
Plan of the Company.
Company. Upon full Board of Directors in
communication and 2021.
discussion, all proposals were
unanimously approved.
Reviewed and approved
the proposals on the
the Company, 2021 Q1 The Audit Committee carried
Report of the Company, out its work in strict
Financial Final Account accordance with laws, For details, please refer to
Report of 2020, Special regulations and relevant rules the Report of Gongniu
Report on the Deposit and policies with diligence. It Group Co., Ltd. On the
Raised Funds for 2020, based on the reality of the Audit Committee of the
Proposal on the Company. Upon full Board of Directors in
Renewal of the Annual communication and 2021.
Auditor for 2021, 2020 discussion, all proposals were
Annual Internal Control unanimously approved.
Evaluation Report and
Internal Audit Plan for
Reviewed and approved
the proposals on the
The Audit Committee carried
out its work in strict
Report of the Company,
accordance with laws, For details, please refer to
Special Report on the
regulations and relevant rules the Report of Gongniu
Semi-annual Deposit
and policies with diligence. It Group Co., Ltd. On the
put forward relevant opinions Duty Performance of the
based on the reality of the Audit Committee of the
and Semi-annual Work
Company. Upon full Board of Directors in
Summary and Work
communication and 2021.
Planning of the Audit
discussion, all proposals were
Supervision Department
unanimously approved.
for the Second Half of
Annual Report 2021
The Audit Committee carried
out its work in strict
accordance with laws, For details, please refer to
regulations and relevant rules the Report of Gongniu
Reviewed and approved
and policies with diligence. It Group Co., Ltd. On the
put forward relevant opinions Duty Performance of the
based on the reality of the Audit Committee of the
Company.
Company. Upon full Board of Directors in
communication and 2021.
discussion, all proposals were
unanimously approved.
The Audit Committee carried
out its work in strict
accordance with laws, For details, please refer to
regulations and relevant rules the Report of Gongniu
Reviewed and approved
and policies with diligence. It Group Co., Ltd. On the
put forward relevant opinions Duty Performance of the
based on the reality of the Audit Committee of the
Plan of the Company.
Company. Upon full Board of Directors in
communication and 2021.
discussion, all proposals were
unanimously approved.
(3) The Remuneration and Appraisal Committee held two meetings during the Reporting Period.
Important comments and Other performance of
Date Contents
suggestions duties
Reviewed and approved
the Proposal on the
Remuneration Schemes
for Directors and Senior
Management Personnel,
Proposal on the
The Remuneration and
Restricted Share
Appraisal Committee carried
Incentive Scheme for
out its work in strict
accordance with laws,
Summary of the
regulations and relevant rules
Company, Proposal on
and policies with diligence. It
put forward relevant opinions
Measures for the
based on the reality of the
Appraisal of the
Company. Upon full
Restricted Share
communication and
Incentive Scheme for
discussion, all proposals were
unanimously approved.
the Request to the
General Meeting to
Authorize the Board of
Directors to Handle
Share Incentive-Related
Matters.
Reviewed and approved The Remuneration and
the Proposal on the Appraisal Committee carried
Achievement of Lifting out its work in strict
the Restriction accordance with laws,
Lifting Restriction and policies with diligence. It
Period of the 2020 put forward relevant opinions
Restricted Share based on the reality of the
Incentive Scheme. Company. Upon full
Annual Report 2021
communication and
discussion, all proposals were
unanimously approved.
(4) The Nomination Committee held one meeting during the Reporting Period.
Important comments and Other performance of
Date Contents
suggestions duties
The Nomination Committee
carried out its work in strict
Reviewed and approved accordance with laws,
Proposal on the Election regulations and relevant rules
of Candidates for Non- and policies with diligence. It
of the Second Board of based on the reality of the
Directors of the Company. Upon full
Company. communication and
discussion, all proposals were
unanimously approved.
(5) Objections
□ Applicable √ Not applicable
VIII Risks Detected by the Supervisory Committee
□ Applicable √ Not applicable
The Supervisory Committee raised no objections during the Reporting Period.
IX Employees of the Company as the Parent and Its Principal Subsidiaries at the Period-end
(I) Employees
Number of in-service employees of the Company
as the parent
Number of in-service employees of principal
subsidiaries
Total number of in-service employees 12,383
Number of retirees to whom the Company as the
parent or its principal subsidiaries need to pay 0
retirement pensions
Functions
Function Employees
Production 8,154
Sales 1,471
Technical 1,576
Financial 119
Administrative 1,063
Total 12,383
Educational background
Educational background Employees
Bachelor’s degree and above 2,040
Junior college 1,941
Technical secondary school and below 8,402
Total 12,383
(II) Remuneration policy
√ Applicable □ Not applicable
The Company further improved its remuneration management and incentive mechanism by revising
the management system related to remuneration and benefits to enhance the competitiveness of
employee remuneration returns. Based on the development of performance, the Company has conducted
a comprehensive and objective evaluation of employees from dimensions such as job value, personal
Annual Report 2021
performance and personal ability, and continued to improve the performance-oriented system of
assessment, training, promotion and incentive, fully mobilizing the creativity and enthusiasm of
employees and promoting the Company's performance growth and personal career development while
improving the remuneration and benefits.
(III)Training plans
√ Applicable □ Not applicable
The Company takes the needs of strategic development as the input for learning and development,
and is committed to the training of the Group's leadership cadres and cultural heritage. It systematically
trains practical and innovative talent in a stratified and graded manner with the two-wheel drive of "lean
tools and methodologies" and "leadership development". The Company insists on the learning concept
of "practical benchmark" and "combination of training and practice" to build a line of accelerated
development and competency in personnel training. The Company has successfully developed
leadership development programs at various levels, such as the Niu Program (school admissions
program), Mou Programme, Yan Program and Ben Program, and promoted leadership development at
managing officer/manager/director/general manager levels, as well as general skill enhancement and
professional capability development programs such as the integration of new employees and the training
of skilled talent, so as to promote the construction of a learning organization. At the same time, the
Gongniu Online platform carries a large amount of learning resources, supplementing internal and
external resources to create a shared learning atmosphere.
(IV) Labor outsourcing
□ Applicable √ Not applicable
X Dividend Payouts
(I) Formulation, execution and adjustments of the cash dividend policy
√ Applicable □ Not applicable
The Articles of Association clarifies the decision-making procedures and mechanism for profit
distribution, the principles of profit distribution, the conditions and proportion of cash dividends, etc.,
ensuring the transparency and operability of cash dividends to effectively safeguard the legitimate rights
and interests of small and medium shareholders and investors. The Company's profit distribution plan is
strictly implemented in accordance with the provisions of the Articles of Association and the resolutions
of the Company's General Meeting of Shareholders.
In order to share with investors the Company’s operating results of 2020, the Board of Directors
declared a cash dividend of RMB20.00 (tax inclusive) per 10 shares to shareholders based on the total
share capital at the record date of the dividend payout. The dividend payout in the total amount of
RMB1,201,151,800 was completed on 3 June 2021.
(II) Special statement on the cash dividend policy
√ Applicable □ Not applicable
In compliance with the Company’s Articles of Association or the relevant √ Yes □ No
resolutions of general meeting of shareholders
Annual Report 2021
Specific and clear dividend standards and ratios √ Yes □ No
Complete decision-making procedure and mechanism √ Yes □ No
Independent directors have faithfully performed their duties and played their due √ Yes □ No
role
Non-controlling shareholders are able to fully express their opinion and demand √ Yes □ No
and their legal rights and interests are fully protected
(III) Where the Company fails to put forward a cash dividend proposal despite the facts that the
Company has made profits in the Reporting Period and the profits of the Company as the parent
distributable to shareholders are positive, it shall give a detailed explanation of why, as well as of
the purpose and use plan for the retained earnings.
□ Applicable √ Not applicable
XI Status and Impact of Share Incentive Schemes, Employee Shareholding Plan or Other
Incentive Measures for Employees
(I)Relevant incentive matters disclosed in current announcement with no subsequent progress or
change
√ Applicable □ Not applicable
Overview Index to the disclosed information
On 10 February 2021, 21 incentive targets including Wu For details, please refer to the
Jun had lost their qualification for the share incentive due Announcement on the Implementation of
to their departure from the Company, and the Company the Repurchase and Cancellation of Some
repurchased and canceled 37,900 restricted shares held Restricted Incentive Shares
by them which had been granted but not lifted from (Announcement No.: 2021-014) on the
restricted sales. website of the SSE (www.sse.com.cn).
On 28 April 2021, the Company held the 3rd meeting of
the 2nd Board of Directors and the 3rd meeting of the
the Proposal on the Restricted Share Incentive Scheme
for 2021 (Draft) and its Summary, Proposal on the
Management Measures for the Assessment of the
For details, please refer to the
Restricted Share Incentive Scheme for 2021, Proposal on
Announcement on the Resolutions of the
Adjusting Matters Related to the Special Talent
Shareholding Plan for 2020, and Proposal on
(Announcement No.: 2021-024) and
Repurchase and Cancellation of Some Restricted Shares.
Announcement on the Resolutions of the
The independent directors of the Company expressed
their independent opinions and agreed to the repurchase
Committee (Announcement No.: 2021-025)
and cancellation of these restricted shares, and Shanghai
on the website of the SSE
Renying Law Firm issued a legal opinion on the
(www.sse.com.cn).
repurchase and cancellation. The Supervisory Committee
of the Company held that the repurchase and cancellation
of these restricted shares are in line with the relevant
regulations and do not prejudice the interests of the
Company and all shareholders, in particular the small and
medium shareholders.
On 29 April 2021, the Company notified its creditors of
For details, please refer to the
the repurchase of restricted shares. During the public
Announcement on Notifying Creditors of
announcement period, the Company did not receive any
the Repurchase and Cancellation of Some
request from the creditors for early settlement of debts or
Restricted Shares (Announcement No.:
provision of corresponding guarantees to the Company,
nor did it receive any objection from any creditor to the
(www.sse.com.cn).
repurchase.
On 29 April 2021, the Company made a public For details, please refer to the List of
announcement on the website of the Shanghai Stock Incentive Targets of 2021 Restricted Share
Exchange (www.sse.com.cn) and within the Company on Incentive Scheme and Explanation of the
the list of incentive targets from 29 April 2021 to 8 May Supervisory Committee on the
Annual Report 2021
Supervisory Committee of the Company did not receive Targets of the 2021 Restricted Share
any objection from any organization or individual. In Incentive Scheme and Verification
addition, the Supervisory Committee of the Company Opinions on the website of the SSE
verified the list of targets of this incentive scheme and (www.sse.com.cn).
announced the Explanation of the Supervisory Committee
of Gongniu Group Co., Ltd. on the Announcement of the
List of Incentive Targets of the 2021 Restricted Share
Incentive Scheme and Verification Opinions on 11 May
For details, please refer to the
On 10 May 2021, the Company held the 4th meeting of Announcement on the Resolutions of the
the 2nd Board of Directors and the 4th meeting of the 4th Meeting of the 2nd Board of Directors
the Proposal on the Restricted Share Incentive Scheme Announcement on the Resolutions of the
for 2021 (Draft Revised) and its Summary and Proposal 4th Meeting of the 2nd Supervisory
on the Management Measures for the Assessment of the Committee (Announcement No.: 2021-041)
Restricted Share Incentive Scheme for 2021 (Revised). on the website of the SSE
(www.sse.com.cn).
On 20 May 2021, the Company held its 2020 Annual
General Meeting, and reviewed and approved the
Proposal on the Restricted Share Incentive Scheme for For details, please refer to the
Management Measures for the Assessment of the 2020 Annual General Meeting
Restricted Share Incentive Scheme for 2021 (Revised) (Announcement No.: 2021-048) on the
and Proposal on the Request to the General Meeting to website of the SSE (www.sse.com.cn).
Authorize the Board of Directors to Handle Share
Incentive-Related Matters.
On 4 June 2021, the Company held the 5th Meeting of
the 2nd Board of Directors and the 5th Meeting of the
For details, please refer to the
Announcement on the Resolutions of the
the Proposal on the Adjustment of the List of Incentive
Targets, Grant Number and Grant Price of the Restricted
(Announcement No.: 2021-054),
Share Incentive Scheme for 2021 and Proposal on
Announcement on the Resolutions of the
Granting Restrictive Shares to Incentive Targets. The
independent directors of the Company consented to this
Committee (Announcement No.: 2021-055)
matter. The Board of Directors determined that the grant
and Verification Opinions of the
date of the Company's 2021 Restricted Share Incentive
Supervisory Committee on the List of
Scheme is 4 June 2021, which is in line with the relevant
Incentive Targets of the 2021 Restricted
provisions of the Administrative Measures for Equity
Share Incentive Scheme (Announcement
Incentive of Listed Companies and the 2021 Restricted
No.: 2021-058) on the website of the SSE
Share Incentive Scheme for grant date. The Supervisory
(www.sse.com.cn).
Committee of the Company verified the adjusted list of
incentive targets again and expressed its clear consent.
On 22 June 2021, the Company held the 6th meeting of For details, please refer to the
the 2nd Board of Directors and the 6th meeting of the Announcement on the Resolutions of the
the Proposal on the Achievement of Lifting the (Announcement No.: 2021-059),
Restriction Conditions in the First Lifting Restriction Announcement on the Resolutions of the
Period of the 2020 Restricted Share Incentive Scheme 6th Meeting of the 2nd Supervisory
and Proposal on the Adjustment of the Repurchase Price Committee (Announcement No.: 2021-060)
of the 2020 Restricted Share Incentive Scheme. The and Announcement on the Achievement of
independent directors of the Company consented to this Lifting the Restriction Conditions in the
matter. In accordance with the Administrative Measures First Lifting Restriction Period of the 2020
for Equity Incentive of Listed Companies, the Company's Restricted Share Incentive Scheme
authorization by the 2019 Annual General Meeting, the Announcement on the Adjustment of the
Board of Directors believed that the Company has made Repurchase Price of the 2020 Restricted
Annual Report 2021
an achievement of lifting the restriction conditions in the Share Incentive Scheme (Announcement
first lifting restriction period of the 2020 Restricted Share No.: 2021-062) on the website of the SSE
Incentive Scheme, and agreed that the Company should (www.sse.com.cn).
handle the relevant matters required for the lifting of the
restricted sales of restricted shares for incentive targets
who met the conditions. In addition, as the company paid
cash drains on June 3, 2021 based on the total share
capital of 600,575,900 shares, according to relevant
regulations such as the Administrative Measures for
Equity Incentive of Listed Companies, the Company's
repurchase price of restricted shares are required to be
adjusted accordingly, i.e., the repurchase price of
restricted shares under the Restricted Share Incentive
Scheme was adjusted from RMB76.13 per share to
RMB74.13 per share.
On 2 July 2021, 21 incentive targets including Wen Bin For details, please refer to the
had lost their qualification for the share incentive due to Announcement on the Implementation of
their departure from the Company, and the Company the Repurchase and Cancellation of Some
repurchased and canceled 31,000 restricted shares held Restricted Incentive Shares
by them which had been granted but not lifted from (Announcement No.: 2021-064) on the
restricted sales. website of the SSE (www.sse.com.cn).
On 9 July 2021, the Company has made an achievement For details, please refer to the
of lifting the restriction conditions in the first lifting Announcement on Lifting the Restriction
restriction period of the 2020 Restricted Share Incentive Conditions in the First Lifting Restriction
Scheme, and the actual number of restricted shares that Period of the 2020 Restricted Share
could be applied for lifting and trading in the market Incentive Scheme and Trading in the
during the first lifting restriction period was 215,520 Market (Announcement No.: 2021-069) on
shares. the website of the SSE (www.sse.com.cn).
On 28 October 2021, the Company held the 8th meeting
For details, please refer to the
of the 2nd Board of Directors and the 8th meeting of the
Announcement on the Resolutions of the
the Proposal on Repurchase and Cancellation of Some
(Announcement No.: 2021-090),
Restricted Shares. The independent directors of the
Announcement on the Resolutions of the
Company consented to this matter. As some incentive
targets of the 2020 Restricted Share Incentive Scheme
Committee (Announcement No.: 2021-
left the Company, the Company agreed to repurchase and
cancel 18,880 restricted shares under the 2020 Restricted
and Cancellation of Some Restricted
Share Incentive Scheme at RMB74.13 per share. As
Shares (Announcement No.: 2021-094)
some incentive targets of the 2021 Restricted Share
and Announcement on Notifying Creditors
Incentive Scheme left the company, the Company agreed
of the Repurchase and Cancellation of
to repurchase and cancel 13,900 restricted shares under
Some Restricted Shares (Announcement
the 2021 Restricted Share Incentive Scheme at
No.: 2021-095).
RMB88.15 per share.
On 24 December 2021, as 28 incentive targets including
Zhang Hong and Wang Na had lost their qualification for For details, please refer to the
the share incentive due to their departure from the Announcement on the Implementation of
Company and some of the incentive targets had lost the the Repurchase and Cancellation of Some
qualification of the incentive scheme due to their Restricted Incentive Shares
departure, the Company repurchased and canceled 32,780 (Announcement No.: 2021-110) on the
restricted shares held by them which had been granted website of the SSE (www.sse.com.cn).
but not lifted from restricted sales.
(II) Incentive plans undisclosed in current announcements or disclosed but with new progress
Equity incentive plans:
□ Applicable √ Not applicable
Other information:
Annual Report 2021
□ Applicable √ Not applicable
Employee stock ownership plans:
□ Applicable √ Not applicable
Other incentive measures:
(III) Equity incentives granted to directors and senior management during the Reporting Period
√ Applicable □ Not applicable
Unit: share
Restricted Restricted Restricted
shares shares shares Closing
Grant Shares
held at granted in Unlocked held at market
Name Office title price still in
the the shares the price
(RMB) lockup
period- Reporting period- (RMB)
begin Period end
Cai
Director 12,500 12,800 88.15 5,000 20,300 20,300 167.30
Yingfeng
Li Senior
Guoqiang management
Total / 26,300 23,400 / 10,520 39,180 39,180 /
(IV) Establishment and formulation of appraisal and incentive mechanisms for senior
management during the Reporting Period
√ Applicable □ Not applicable
The remuneration of the senior management personnel of the Company is implemented based on the
actual operations and the relevant rules of the Company.
XII Development and Implementation of Internal Control Systems During the Reporting Period
√ Applicable □ Not applicable
In strict compliance with the Company Law, Securities Law, Code of Corporate Governance for
Listed Companies, Guidelines for Evaluation of Enterprise Internal Control and other relevant laws and
regulations, the Company continuously establishes and improves its internal control system and
enhances the level of internal control management.
During the Reporting Period, in order to further promote the standardized operation of the
Company, enhance the authenticity, accuracy, completeness and timeliness of information disclosure of
the annual report, and improve the quality and transparency of information disclosure of the annual
report, the Company formulated the Accountability Policy for Material Errors in Information Disclosure
of the Annual Report. The Company intensified auditing and supervision, implemented special audits for
wealth management and seal management, and provided timely feedback on problems found to business
departments for rectification. In addition, the Company has conducted knowledge publicity of internal
control for employees to raise their awareness of internal control and promote the development of
internal control culture.
Explanation of material weaknesses in internal control during the Reporting Period:
□ Applicable √ Not applicable
XIII Management and Control over Subsidiaries during the Reporting Period
√ Applicable □ Not applicable
During the reporting period, the Company strictly followed the requirements of the Shanghai Stock
Exchange and various rules and regulations of the Board of Directors of the Company to regulate the
Annual Report 2021
management and risk control of subsidiaries. Subsidiaries reported significant information such as
operations to the Company, and there were no undisclosed matters that should have been disclosed.
XIV Independent Auditor’s Report on Internal Control
√ Applicable □ Not applicable
Upon audit, Pan-China Certified Public Accountants LLP is of the opinion that Gongniu maintained,
in all material respects, effective internal control over financial reporting as of 31 December 2021, based
on the Basic Rules on Enterprise Internal Control and other applicable regulations.
Whether the Independent Auditor’s Report on Internal Control is disclosed: Yes
Type of the independent auditor’s opinion: Unmodified unqualified opinion
XV Remediation of Problems Identified by Self-inspection in the Special Action on the
Governance of Listed Companies
In order to implement the spirit of the Opinions of the State Council on Further Improving the
Quality of Listed Companies, the CSRC launched a special action on the governance of listed companies.
According to the unified deployment and guidance of the CSRC Ningbo Bureau, the Company
completed the first phase of self-inspection and actively carried out remediation of problems identified
in the self-inspection list of corporate governance by carefully identifying the causes and formulating a
remediation plan to complete the remediation. The details are as follows:
Analysis of the causes of the problems identified in the self-inspection and remediation plan:
(I) Basic information of the listed company
Cause analysis: The 1st Board of Directors of the Company expired on 22 December 2020, and the
renewal meeting was postponed as some directors returned from abroad and were quarantined for
pandemic prevention and control.
Remediation measures: First, after the above problems were identified, the Company actively
contacted the relevant directors to determine the quarantine and the earliest time to attend the meetings
of the board of directors, the supervisory committee or the general meeting upon the end of the
quarantine (determined to be 7 January 2021), and promoted the normal replacement procedure to
minimize the impact as far as possible.
Remediation time: January 2021
Remediation effect: The Company has completed all the work for the change of term on 7 January
(II) Shareholders, directors, supervisors and senior management personnel
the following circumstances:
(A) Failure to attend or appoint another person to attend on behalf of him/her at the general meeting,
the meeting of the board of directors or supervisory committee as required.
Cause analysis: Director Cai Yingfeng was absent from the1st Extraordinary General Meeting of
due to the impact of the pandemic in Beijing at that time.
Annual Report 2021
Remediation measures: The Company coordinated the time of the directors and supervisors in
advance and informed them that they should attend the General Meeting in accordance with the
regulations.
Remediation time: May 2021
Remediation effect: All directors, supervisors and senior management personnel of the Company
attended the subsequent General Meeting of the Company (the 2020 Annual General Meeting), and
exercised their powers and duties fully and diligently.
working days.
Cause analysis: Independent directors are mainly involved in the work of the Company through
conference seminars, and due to the pandemic, they often worked online, with less time for on-site work.
Remediation measures: First, the Company clarified to the independent directors the requirements
on the duty performance of independent directors in the Guidelines on the Duty Performance of
Independent Directors of Listed Companies (2020 Revision) and other business guidelines, requiring
them to work on-site for not less than 10 working days. Second, the Company actively promoted the
shift of the independent directors' office performance from online to on-site, flexibly arranged for offices
at the Group's headquarters (Cixi) and Shanghai to create more convenient and efficient conditions for
on-site work, and adequately recorded the on-site work time of independent directors. The Company
attached importance to the corporate governance opinions put forward by the independent directors to
further strengthen the standardized governance of the Company.
Remediation time: 2021
Improving the corporate governance mechanism is a long-term task. The Company will take this
self-inspection as an opportunity to conduct a comprehensive self-inspection and assessment of the
Company, and remedy the problems identified in the self-inspection in strict accordance with relevant
laws and regulations and regulatory requirements, so as to promote the construction of a long-term
corporate governance mechanism and further improve the Company's corporate governance.
XVI Other information
□ Applicable √ Not applicable
Part V Environmental and Social Responsibility
I Environment information
(I) Description of the environmental protection of the company and its major subsidiaries that are
key emission units as declared by the environmental protection authorities
√ Applicable □ Not applicable
√ Applicable □ Not applicable
Ningbo Gongniu Electrics Co., Ltd. is a key unit supervised for soil environmental pollution in
Ningbo, with a commissioned disposal volume of 483.4 tons of hazardous waste in 2021. During the
Reporting Period, the Company discharged in strict accordance with the requirements of the
Annual Report 2021
implemented pollutant discharge standards, with no environmental pollution incidents and no penalties
imposed by the environmental protection authorities.
None of the Company's units, other than Ningbo Gongniu Electrics Co., Ltd., is a key emission unit
as declared by the environmental protection authorities.
√ Applicable □ Not applicable
The Company actively implements the green development strategy, practices the concept of green,
low-carbon and ecological development, increases investment in safety and environmental protection,
applies green technologies of green, energy conservation, environmental protection and resource reuse,
promotes innovation and transformation in manufacturing processes and business procedures, reduces
wastewater, waste gas emissions and noise pollution, vigorously carries out energy-saving technology
reform and eliminates backward equipment with high energy consumption, and continuously develops a
green manufacturing system. In 2021, the Company invested a total of RMB18.85 million in operation
costs of environmental protection equipment, and the waste gas pollution treatment facilities have been
upgraded to the international advanced “zeolite rotary adsorption + RTO combustion” technology, with
the treatment effect of VOC reduced to 30mg/m3 and below.
licenses of environmental protection
√ Applicable □ Not applicable
All the Company's construction projects have fulfilled the environmental impact evaluation and
other environmental protection administrative licensing procedures in accordance with the requirements
of national environmental protection laws and regulations.
√ Applicable □ Not applicable
The Company has established an effective emergency response mechanism for environmental
emergencies, and the chemical intermediate warehouse of each base and each plant involving hazardous
waste and hazardous chemicals rehearse the contingency plan at least twice a year. In order to improve
the corporate ability to respond to environmental pollution accidents, the Company formulated the
Contingency Plan of Ningbo Gongniu Electrics Co., Ltd. for Environmental Emergencies (File No.
Environmental Protection Law of the People's Republic of China and based on the actual situation.
During the Reporting Period, the Company optimized and revised the Safe Production Input Protection
System, EHS Laws, Regulations and Other Management Regulations, Policy for Safety Management of
Dangerous Operations and Management Regulations on BSS Provisions and Operation of Gongniu
Safety System.
√ Applicable □ Not applicable
Annual Report 2021
In accordance with the requirements of self-monitoring of environmental protection, the Company
has formulated the Management System for Self-monitoring of Pollution Sources and regularly carries
out self-monitoring work. In 2021, it commissioned qualified third-party testing units to orderly carry
out tests on spraying exhaust gas, noise at the factory boundary, domestic sewage, soil and groundwater,
and the test reports issued showed that none of the pollutants exceeded the standards.
□ Applicable √ Not applicable
√ Applicable □ Not applicable
Ningbo Gongniu Electrics Co., Ltd. Was included in the first batch of Ningbo 2022 positive list of
enterprises for ecological and environmental supervision and enforcement. Ningbo Gongniu Electrics
Co., Ltd. Was rated as A in the environmental credit evaluation of enterprises in Zhejiang Province in
(II) Environmental protection of companies other than key emission units
√ Applicable □ Not applicable
□ Applicable √ Not applicable
√ Applicable □ Not applicable
Except for Ningbo Gongniu Electrics Co., Ltd., all other units of the Group are not key emission
units and have strictly implemented relevant laws and regulations on environmental protection, installed
additional environmental protection equipment for processes that generate environmental pollution in
accordance with the requirements of the environmental credit evaluation, which passed the acceptance
and met the discharge standards. All three wastes were discharged in accordance with the standard.
There was no environmental pollution accident and no punishment by the environmental protection
authorities, and all the units were rated as A in the annual environmental credit evaluation of enterprises
in Zhejiang Province.
In particular, Ningbo Gongniu Photoelectric Technology Co., Ltd. Was included in the first batch
of Ningbo 2022 positive list of enterprises for ecological and environmental supervision and
enforcement.
□ Applicable √ Not applicable
(III) Information that is conducive to ecological protection, pollution prevention and
environmental responsibility performance
√ Applicable □ Not applicable
To strengthen the awareness of environmental protection among employees, the Company
organized a World Environment Day event on 5 June 2021 to publicize environmental protection
through cycling and walking activities; to further strengthen the environmental management of the
Annual Report 2021
spraying line, the Company built a new spraying plant and upgraded the exhaust gas pollution treatment
facilities from “activated carbon adsorption + catalytic combustion” to the current international
advanced “zeolite rotary adsorption + RTO combustion. Currently, the construction and relocation of the
new spraying plant have been completed.
In order to practice a circular economy and make effective use of resources, the molding plant has
set up a recycling mechanism for plastic pellets and reused at least 8,500 tons of plastic pellets through
shredding in 2021.
(IV) Measures taken to reduce carbon emissions during the Reporting Period and their effects
√ Applicable □ Not applicable
The "14th Five-Year Plan" period is critical for China to achieve the peak in carbon emissions and
promote high-quality economic development and sustainable improvement of ecological and
environmental quality. In order to conscientiously implement the national work requirements for carbon
emission reduction, achieve peak carbon emissions and high-quality economic development, the
Company mainly works on the following aspects:
(1) The Company continuously promoted the construction of "green factories". In December 2020,
Ningbo Gongniu Electrics Co., Ltd., a wholly-owned subsidiary of the Group, was accredited as a
"National Green Factory" by the Ministry of Industry and Information Technology, and in August 2021,
Ningbo Gongniu was again selected as one of the first five-star green factories in Ningbo. Ningbo
Gongniu actively implements the green development strategy, practices the concept of green, low-
carbon and ecological development, increases investment in safety and environmental protection, applies
green technologies of green, energy conservation, environmental protection and resource reuse,
promotes innovation and transformation in manufacturing processes and business procedures, reduces
wastewater, waste gas emissions and noise pollution, vigorously carries out energy-saving technology
reform and eliminates backward equipment with high energy consumption, and continuously develops a
green manufacturing system.
(2) The Company has launched new energy vehicle charging plugs and points. Closely following
the policy and industry development trend, the Company has expanded its electric connection business
from the home scenario to the new energy vehicle sector, and supported the development of the new
energy vehicle industry by providing consumers with better quality products and services through
technology and material innovation.
II Fulfillment of Social Responsibility
√ Applicable □ Not applicable
For details, please refer to the 2021 Environmental, Social and Governance Report of Gongniu
Group Co., Ltd. Published by the Company on the website of the Shanghai Stock Exchange
(http://www.sse.com.cn).
III Efforts in Poverty Alleviation, Rural Revitalization, etc
√ Applicable □ Not applicable
Annual Report 2021
During the Reporting Period, the Company maintained sound development while taking practical
actions to actively consolidate and extend the achievements of poverty alleviation and support the
implementation of the rural revitalization strategy. In terms of poverty alleviation and bailout, the
Company actively responded to the planning requirements of the Zhejiang Provincial Government on
the "Shanhai Collaboration Project" by donating RMB1 million to Guotang Village in Changshan
County through the Cixi Charity Federation to help the poor and needy, while firmly supporting the
organization of poverty alleviation in the pair counties of Cixi City - Anlong and Xingren in Guizhou. In
terms of giving back to the hometown, the Company donated RMB1 million to Guyaopu village, the
birthplace of the Company, for villagers' health check-ups and environmental hygiene construction, and
sent an RMB1,000 New Year pocket to the elderly aged 70 or above before the Chinese New Year. The
Company will continue to actively practice its corporate social responsibility based on the actual
situation.
Annual Report 2021
Part VI Significant Events
I Fulfillment of Commitments
(I) Commitments of the Company's actual controller, shareholders, related parties and acquirers, as well as the Company and other entities during the
Reporting Period or commitments continuing to the Reporting Period
√ Applicable □ Not applicable
If it is not If it is not
Whether timely timely
Time of Whether it is performed, performed,
Commitment Commitment Commitment commitment there is a timely the the plan
Promisor
background Category Contents making and deadline for and specific for the
term performance strictly reasons next step
performed shall be shall be
stated stated
Within 36 months from the date of listing of
the Company's shares, the promisor will not
transfer or entrust others to manage the shares
he/she directly or indirectly holds in the
Company which were issued before the IPO,
nor will the Company repurchase such shares.
If the shares held by the promisor are reduced
Within 36
Liangji within two years after the expiry of the lock-up
months
Industrial, period, the price of such reduction shall not be
from the
Commitments Restricted Ninghui lower than the issue price of the IPO (if the Not Not
date of Yes Yes
related to IPO share sales Investment, Company's shares are subject to ex-rights and applicable applicable
listing of the
Suiyuan ex-dividend matters such as dividend
Company's
Investment distribution, share bonus and capital reserves to
shares
share capital, the issue price will be adjusted
ex-rights and ex-dividend, the same below); if
the closing price of the Company's shares for
issue price within six months after the listing of
the Company, or the closing price at the end of
six months after the listing is lower than the
Annual Report 2021
issue price, the lock-up period for holding the
Company's shares will be automatically
extended for at least six months.
Within 36
Within 36 months from the date of listing of
months
the Company's shares, the promisor will not
from the
Restricted transfer or entrust others to manage the shares Not Not
Qiyuanbao date of Yes Yes
share sales he/she directly or indirectly holds in the applicable applicable
listing of the
Company which were issued before the IPO,
Company's
nor will the Company repurchase such shares.
shares
Hillhouse
Within 12
Daoying, Within 12 months from the date of listing of
months
Xiaozhou the Company's shares, the promisor will not
from the
Restricted Investment, transfer or entrust others to manage the shares Not Not
date of Yes Yes
share sales Bowei he/she directly or indirectly holds in the applicable applicable
listing of the
Investment, Company which were issued before the IPO,
Company's
Sun nor will the Company repurchase such shares.
shares
Rongfei
Within 36 months from the date of listing of
the Company's shares, the promisor will not
Ruan transfer or entrust others to manage the shares
Liping, he/she directly or indirectly holds in the
Ruan Company which were issued before the IPO,
Xueping, nor will the Company repurchase such shares. Within 36
Cai If the Company's shares directly or indirectly months
Yingfeng, held by the promisor are reduced within two from the
Restricted Not Not
Liu years after the expiry of the lock-up period, the date of Yes Yes
share sales applicable applicable
Shengsong, price of such reduction shall not be lower than listing of the
Zhou the issue price (if the Company's shares are Company's
Zhenghua, subject to ex-rights and ex-dividend matters shares
Li such as dividend distribution, share bonus and
Guoqiang, capital reserves to share capital, the issue price
Zhang Lina will be adjusted ex-rights and ex-dividend, the
same below); if the closing price of the
Company's shares for 20 consecutive trading
Annual Report 2021
days is lower than the issue price within six
months after the listing of the Company, or the
closing price at the end of six months after the
listing is lower than the issue price, the lock-up
period for holding the Company's shares will
be automatically extended for at least six
months. After the expiry of the above-
mentioned commitment lock-up period, during
my term of office as a director, supervisor or
senior management personnel of the Company,
if I leave the Company before the expiry of my
term of office, during the term of office
determined at the time of my assumption of
office and within six months after the expiry of
my term of office: 1) I will transfer no more
than 25% of the total number of shares of the
Company held directly or indirectly by me each
year; 2) I will not transfer the shares of the
Company held directly or indirectly by me
within six months after leaving the Company;
regulations, departmental rules and regulations,
regulatory documents and other regulations for
the transfer of shares by directors, supervisors
and senior management personnel of the
business rules of the stock exchange.
Within 36 months from the date of listing of
the Company's shares, the promisor will not Within 36
Shen transfer or entrust others to manage the shares months
Huiyuan, he/she directly or indirectly holds in the from the
Restricted Not Not
Guan Company which were issued before the IPO, date of Yes Yes
share sales applicable applicable
Xuejun, nor will the Company repurchase such shares. listing of the
Li Yu After the expiry of the above-mentioned Company's
commitment lock-up period, during my term of shares
office as a director, supervisor or senior
Annual Report 2021
management personnel of the Company, if I
leave the Company before the expiry of my
term of office, during the term of office
determined at the time of my assumption of
office and within six months after the expiry of
my term of office: 1) I will transfer no more
than 25% of the total number of shares of the
Company held directly or indirectly by me each
year; 2) I will not transfer the shares of the
Company held directly or indirectly by me
within six months after leaving the Company;
regulations, departmental rules and regulations,
regulatory documents and other regulations for
the transfer of shares by directors, supervisors
and senior management personnel of the
business rules of the stock exchange.
The Company will not provide loans and any
other forms of financial assistance, including
provision of guarantees for loans, to the
Gongniu Not Not
Others incentive targets of the 2020 Restricted Share No Yes
Group applicable applicable
Incentive Scheme of Gongniu Group for
acquiring the relevant restricted shares under
this incentive scheme.
Commitments If the Company is not eligible for the grant of
related to equity or exercise of equity arrangement due to
Incentive
share a false record, misleading statement, or
targets of
incentives material omission in the information disclosure
the 2020
document, the incentive target shall return to Not Not
Others Restricted No Yes
the Company all the benefits received from the applicable applicable
Share
share incentive scheme after the false record,
Incentive
misleading statement or material omission are
Scheme
confirmed in relevant information disclosure
documents.
Others Gongniu The Company will not provide loans and any No Yes Not Not
Annual Report 2021
Group other forms of financial assistance, including applicable applicable
the provision of guarantees for loans, to the
incentive targets of the 2021 Restricted Share
Incentive Scheme of Gongniu Group for
acquiring the relevant restricted shares under
this incentive scheme.
If the Company is not eligible for the grant of
equity or exercise of equity arrangement due to
Incentive a false record, misleading statement or material
targets of omission in the information disclosure
the 2021 document, the incentive target shall return to Not Not
Others No Yes
Restricted the Company all the benefits received from the applicable applicable
Share share incentive scheme after the false record,
Incentive misleading statement or material omission are
confirmed in relevant information disclosure
documents.
In strict accordance with the Proposal on the
Stabilization of Share Price within Three Years
of Listing, Ningbo Liangji Industrial Co., Ltd.
will fully and effectively fulfill its obligations
and responsibilities under the Proposal, and
Three years
strongly urge the joint stock company and the
from the
Liangji relevant parties to fully and effectively fulfill Not Not
Others date of Yes Yes
Industrial their obligations and responsibilities under the applicable applicable
listing of the
Proposal. When the General Meeting of the
Other Company
Company resolves on the repurchase of shares
undertakings
in accordance with the provisions of the
Proposal, Ningbo Liangji Industrial Co., Ltd.
undertakes to vote in favor of the proposal on
the repurchase at the General Meeting.
In strict accordance with the Proposal on the Three years
Ruan
Stabilization of Share Price within Three Years from the
Liping, Not Not
Others of Listing, I will fully and effectively fulfill its date of Yes Yes
Ruan applicable applicable
obligations and responsibilities under the listing of the
Xueping
Proposal, and strongly urge the company and Company
Annual Report 2021
the relevant parties to fully and effectively
fulfill the obligations and responsibilities under
the Proposal. When the General Meeting of the
Company resolves on the repurchase of shares
in accordance with the provisions of the
Proposal, I undertake that I and those acting in
concert will vote in favor of the proposal on the
repurchase at the General Meeting.
Cai
Yingfeng,
Liu
In strict accordance with the Proposal on the
Shengsong,
Stabilization of Share Price within Three Years
Zhou Three years
of Listing, I will fully and effectively fulfill its
Zhenghua, from the
obligations and responsibilities under the Not Not
Others Cao Wei, date of Yes Yes
Proposal, and strongly urge the company and applicable applicable
Zhang listing of the
the relevant parties to fully and effectively
Zeping, He Company
fulfill the obligations and responsibilities under
Hao, Xie
the Proposal.
Tao, Li
Guoqiang,
Zhang Lina
(1) The company undertakes not to transfer
benefits to other entities or individuals free of
charge or on unfair terms, nor to impair the
interests of the issuer by any other means. (2)
The company undertakes not to intervene in the
issuer's management activities, and not to
Liangji
encroach on its interests. (3) The company Not Not
Others Industrial No Yes
undertakes to exercise the rights of applicable applicable
shareholders as stipulated in the laws,
regulations and regulatory documents in
accordance with the law and not to prejudice
the legitimate rights and interests of the issuer
and other shareholders. In the event of any
breach of the above commitments, the
Annual Report 2021
company agrees to accept relevant penalties or
management measures in accordance with the
relevant regulations and rules formulated or
issued by the China Securities Regulatory
Commission and the Shanghai Stock Exchange
and other securities regulatory authorities, and
bear individual and joint and several liability to
the issuer and investors for any losses caused to
the issuer and investors by the company.
(1) The company and companies or other
organizations controlled by the company are
not engaged in the same or similar business as
the issuer and its subsidiaries, with no
horizontal competition. (2) The company and
companies or other organizations controlled by
the company will not engage in the same or
similar business as the existing business of the
issuer and its subsidiaries in any form outside
China, including not investing in, acquiring or
merging with companies or other economic
organizations outside China that compete with
Settlement
Other Liangji the existing principal business of the issuer and Not Not
of horizontal No Yes
undertakings Industrial its subsidiaries. (3) If the issuer and its applicable applicable
competition
subsidiaries engage in new business in the
future, the company and companies or other
organizations controlled by the company will
not engage in business activities in direct
competition with the new business of the issuer
and its subsidiaries by share holding or
participating in but having substantial control
over the shares of the issuer and its subsidiaries
within or outside China, including investing in,
acquiring or merging with companies or other
economic organizations within or outside
China that directly compete with the new
Annual Report 2021
business of the issuer and its subsidiaries in the
future. (4) If the company and legal entities
controlled by the company have business
operations in direct competition with the issuer
and its subsidiaries, the issuer and its
subsidiaries shall have the right to centralize
the competing businesses to the operations of
the issuer and its subsidiaries through
preferential acquisition or entrustment. (5) The
company undertakes not to use its position as a
shareholder of the issuer and its subsidiaries to
seek improper benefits and thereby harm the
rights and interests of other shareholders of the
issuer and its subsidiaries. If the rights and
interests of the issuer and its subsidiaries are
damaged due to a breach of the above
statements and commitments by the company
and companies or other organizations
controlled by the company, the company agrees
to be liable to the issuer and its subsidiaries for
the corresponding damages.
(1) I and companies or other organizations
controlled by me are not engaged in the same
or similar business as the issuer and its
subsidiaries, with no horizontal competition.
(2) I and companies or other organizations
Ruan controlled by me will not engage in the same or
Settlement
Other Liping, similar business as the existing business of the Not Not
of horizontal No Yes
undertakings Ruan issuer and its subsidiaries in any form outside applicable applicable
competition
Xueping China, including not investing in, acquiring or
merging with companies or other economic
organizations outside China that compete with
the existing principal business of the issuer and
its subsidiaries. (3) If the issuer and its
subsidiaries engage in new business in the
Annual Report 2021
future, I and companies or other organizations
controlled by me will not engage in business
activities in direct competition with the new
business of the issuer and its subsidiaries by
share holding or participating in but having
substantial control over the shares of the issuer
and its subsidiaries within or outside China,
including investing in, acquiring or merging
with companies or other economic
organizations within or outside China that
directly compete with the new business of the
issuer and its subsidiaries in the future. (4) If I
and legal entities controlled by me have
business operations in direct competition with
the issuer and its subsidiaries, the issuer and its
subsidiaries shall have the right to centralize
the competing businesses to the operations of
the issuer and its subsidiaries through
preferential acquisition or entrustment. (5) I
undertake not to use its position as a
shareholder of the issuer and its subsidiaries to
seek improper benefits and thereby harm the
rights and interests of other shareholders of the
issuer and its subsidiaries. If the rights and
interests of the issuer and its subsidiaries are
damaged due to a breach of the above
statements and commitments by me and
companies or other organizations controlled by
me, I agree to be liable to the issuer and its
subsidiaries for the corresponding damages.
The company will minimize and standardize
Settlement
the related-party transactions with Gongniu
Other of related- Liangji Not Not
Group Co., Ltd. and its wholly-owned or No Yes
undertakings party Industrial applicable applicable
controlled subsidiaries. For related-party
transactions
transactions that are inevitable or occur for
Annual Report 2021
reasonable reasons, the company will strictly
comply with the provisions of relevant laws,
regulations and the Articles of Association of
the company, follow the principles of
equitable, remunerative and fair transactions,
perform legal procedures, and determine the
transaction prices in accordance with
reasonable prices recognized by the market to
ensure the fairness of the related-party
transactions. The company will not leverage its
shareholder status to induce the General
Meeting or the Board of Directors of the
Company to make resolutions that infringe
upon the legitimate rights and interests of the
Company and other shareholders. In operating
decisions, the company will strictly follow the
relevant provisions of the Company Law and
the Articles of Association to implement the
avoidance system of related shareholders to
safeguard the legitimate rights and interests of
all shareholders.
I will minimize and standardize the related-
party transactions with Gongniu Group Co.,
Ltd. and its wholly-owned or controlled
subsidiaries. For related-party transactions that
are inevitable or occur for reasonable reasons, I
Settlement Ruan will strictly comply with the provisions of
Other of related- Liping, relevant laws, regulations and the Articles of Not Not
No Yes
undertakings party Ruan Association of the company, follow the applicable applicable
transactions Xueping principles of equitable, remunerative and fair
transactions, perform legal procedures, and
determine the transaction prices in accordance
with reasonable prices recognized by the
market to ensure the fairness of the related-
party transactions. I will not leverage its
Annual Report 2021
shareholder status to induce the General
Meeting or the Board of Directors of the
Company to make resolutions that infringe
upon the legitimate rights and interests of the
Company and other shareholders. In operating
decisions, I will strictly follow the relevant
provisions of the Company Law and the
Articles of Association to implement the
avoidance system of related shareholders to
safeguard the legitimate rights and interests of
all shareholders.
(II) Where there had been an earnings forecast for an asset or project and the Reporting Period was still within the forecast period, explain why the
forecast has or has not been reached for the Reporting Period.
□ Forecast reached □ Forecast unreached √ Not applicable
(III) Fulfillment of performance commitments and the impact on goodwill impairment tests
□ Applicable √ Not applicable
II Occupation of the Company’s Capital by the Controlling Shareholder or Other Related Parties for Non-Operating Purposes during the Reporting
Period
□ Applicable √ Not applicable
III Irregularities in the Provision of Guarantees
□ Applicable √ Not applicable
Annual Report 2021
IV Explanation Given by the Board of Directors Regarding “Independent Auditor’s Report with
Modified Opinion”
□ Applicable √ Not applicable
V Reasons for Accounting Policy or Estimate Changes or Correction of Material Accounting
Errors and the Impact
(I) Reasons for accounting policy or estimate changes and the impact
√ Applicable □ Not applicable
For details, see “44. Changes to critical accounting policies and estimates” under “V Critical
Accounting Policies and Estimates” of “Part X Financial Statements”.
(II) Reasons for correction of material accounting errors and the impact
□ Applicable √ Not applicable
(III) Communications with the former CPA firm
□ Applicable √ Not applicable
(IV) Other information
□ Applicable √ Not applicable
VI Appointment and Dismissal of CPA Firm
Unit: RMB’0,000
In service
Name of the domestic CPA firm Pan-China Certified Public Accountants LLP
The Company’s payment to the domestic CPA
firm
How many years the domestic CPA firm has
provided audit service for the Company
Name Payment
CPA firm for the audit of Pan-China Certified Public
internal control Accountants LLP
Sponsor Sinolink Securities Co., Ltd.
Appointment and dismissal of CPA firm:
√ Applicable □ Not applicable
As resolved by the 2020 Annual General Meeting of Shareholders, the Company decided to re-
appoint Pan-China Certified Public Accountants LLP as the independent auditor for the financial
statements and internal control of 2021.
Change of the CPA firm during the audit:
□ Applicable √ Not applicable
VII Delisting Risk
(I) Reasons for the delisting risk warning
□ Applicable √ Not applicable
(II) The Company’s response
□ Applicable √ Not applicable
(III) Risk of termination of listing and the reasons
□ Applicable √ Not applicable
VIII Insolvency and Reorganization
□ Applicable √ Not applicable
IX Significant Legal Matters
√ The Company has material litigation and arbitration this year
□The Company has no material litigation and arbitration this year
Annual Report 2021
(I) Litigation and arbitration matters disclosed in current announcement with no subsequent
progress
□ Applicable √ Not applicable
(II) Litigation and arbitration not disclosed in current announcement or with subsequent progress
√ Applicable □ Not applicable
Unit: RMB'0,000
During the Reporting Period:
Whethe
Join r the
Amoun Litigatio Executi
t- litigatio
Type t Litigati n on of
and- n
Plaintif Defen of Basic involve on (arbitrati litigatio
seve (arbitra
f dant litigati Information d in (arbitra on) n
ral tion)
(accuse (accus on and on litigation litigatio tion) results (arbitra
liabl resulted
r) ed) arbitra (arbitration) n progres and tion)
e in
tion (arbitra s influence judgme
part provisi
tion) s nt
y ons and
amount
In November
Shenzhen
Lanse Feiwu
Technology
The
Co., Ltd.
compan
filed
y has
litigation
execute
against
d and
Ningbo
will
Gongniu as
recover
the defendant The
from
in a dispute second
the
over trial
relevan
infringement ruled that
Shenzh t
Litigat of invention Ningbo
en supplie
ion of patent rights, The Gongniu
Lanse Ningb rs at the
invent case No. second should
Feiwu o same
ion (2019) ZH. 82.50 No trial has cease its
Techno Gongn time in
patent 02 M.CH. been infringe
logy iu accorda
disput No. 13 decided ment and
Co., nce
es [original case pay a
Ltd. with
No. (2017) compens
the
Y. 73 M.CH. ation of
contrac
No. 4526]. RMB300
tual
Invention ,000.
agreem
patent
ents
involved is
and
"control
relevan
method and
t legal
equipment
provisi
for self-
ons.
powered
electronic
fixtures
subject to
reset" (Patent
Annual Report 2021
No.
ZL20128007
In March
Shenzhen The
Lanse Feiwu second
Technology trial The
Co., Ltd. ruled that compan
filed Ningbo y has
litigation Gongniu execute
against should d and
Ningbo cease the will
Gongniu as manufact recover
the defendant ure, sale from
in a dispute and the
over promise relevan
Shenzh infringement to sell t
Litigat
en of invention and supplie
ion of The
Lanse Ningb patent rights, destroy rs at the
invent second
Feiwu o case No. its stock same
ion 150.00 No trial has
Techno Gongn (2018) Y. 03 of time in
patent been
logy iu M.CH. No. infringin accorda
disput decided
Co., 222. The g nce
es
Ltd. invention products. with
patent The the
involved is plaintiff contrac
"control was paid tual
method and RMB600 agreem
equipment ,000 for ents
for self- economi and
powered c loss relevan
electronic and t legal
fixtures reasonab provisi
subject to le costs ons.
reset" (Patent to defend
No. its rights.
ZL20128007
(III) Other information
□ Applicable √ Not applicable
X Punishments on the Company as well as Its Directors, Supervisors, Senior Management,
Controlling Shareholder and Actual Controller for Violation of Laws or Regulations, as well as the
Relevant Rectifications
□ Applicable √ Not applicable
XI Credit Standings of the Company as well as Its Controlling Shareholder and Actual Controller
during the Reporting Period
□ Applicable √ Not applicable
XII Major Related-Party Transactions
(I) Continuing related-party transactions
□ Applicable √ Not applicable
√ Applicable □ Not applicable
Annual Report 2021
Index to the disclosed
Transaction overview
information
The Proposal on Estimated Continuing Related-Party Transactions for
Directors. For details, see the Announcement on Estimated Continuing
www.sse.com.cn (website
Related-Party Transactions for 2021 (Announcement No. 2021-020)
of the Shanghai Stock
disclosed by the Company during the Reporting Period.
Exchange)
For the actual execution of the aforesaid estimated related-party
transactions, see the Announcement on Estimated Continuing Related-
Party Transactions for 2022 (Announcement No. 2022-024).
□ Applicable √ Not applicable
(II) Related-party transactions regarding purchase or sale of assets or equity investments
□ Applicable √ Not applicable
□ Applicable √ Not applicable
□ Applicable √ Not applicable
performance results for the Reporting Period shall be disclosed.
□ Applicable √ Not applicable
(III) Major related-party transactions regarding joint investments in third parties
□ Applicable √ Not applicable
□ Applicable √ Not applicable
□ Applicable √ Not applicable
(IV) Amounts due to and from related parties
□ Applicable √ Not applicable
□ Applicable √ Not applicable
□ Applicable √ Not applicable
(V) Financial transactions between the Company and related finance companies, or between
finance companies under the Company’s control and related parties
□ Applicable √ Not applicable
(VI) Other information
□ Applicable √ Not applicable
XIII Major Contracts and the Execution
(I) Entrustment, Contracting and Leases
□ Applicable √ Not applicable
□ Applicable √ Not applicable
Annual Report 2021
□ Applicable √ Not applicable
(II) Guarantees
□ Applicable √ Not applicable
Annual Report 2021
(III) Cash entrusted to other entities for management
(1) Total cash entrusted for wealth management
√ Applicable □ Not applicable
Unit: RMB’0,000
Type Funding source Amount Undue amount Unrecovered overdue amount
Bank’s financial product Self-funded 460,660.00 460,660.00
Bank’s financial product Raised funds 62,000.00 20,000.00
Structured deposits Self-funded 140,001.00 50,001.00
Structured deposits Raised funds 128,000.00 60,000.00
Trust product Self-funded 200,000.00 112,000.00
Other information
□ Applicable √ Not applicable
(2) Single Wealth Management Entrustment
√ Applicable □ Not applicable
Unit: RMB’0,000
Actual Through Continuing
Expecte Recovery/payme Impairme
Type of Fundin Investme Way of Annualize gain/loss the wealth
Start End d nt of gain/loss in nt
Consignee financial Amount g nt repayme d rate of in the statutory manageme
date date returns the Reporting allowance
product source direction nt return Reportin procedur nt plans or
(if any) Period (if any)
g Period e or not not
Principal
repayme
CITIC Trust Trust 2022- Self-
Co., Ltd. product 2-21 funded
upon
maturity
Principal
repayme
Agricultural
Bank’s 2021 nt with
Bank of China, Infinit Self- 2.5%-
financial 6,900.00 -11- all Undue Yes Yes
Cixi Shiqiao e funded 2.8%
product 9 interest
Sub-branch
upon
maturity
Agricultural Structure 30,000.00 2021 2022- Raised Principal 1.8-3.5% Undue Yes Yes
Annual Report 2021
Bank of China, d -1- 1-20 funds repayme
Cixi Shiqiao deposits 22 nt with
Sub-branch all
interest
upon
maturity
Principal
repayme
Agricultural
Bank’s 2021 nt with
Bank of China, 2022- Self- 2.5%-
financial 3,350.00 -9- all Undue Yes Yes
Cixi Shiqiao 1-7 funded 3.05%
product 16 interest
Sub-branch
upon
maturity
Principal
China repayme
Minsheng Bank Bank’s 2021 nt with
Infinit Self- 2.79%-
Co., Ltd., financial 47,200.00 -12- all Undue Yes Yes
e funded 2.90%
Ningbo Cixi product 30 interest
Sub-branch upon
maturity
Principal
China repayme
Minsheng Bank Bank’s 2021 nt with
Co., Ltd., financial 20,000.00 -8- all 3.3-4.5% Undue Yes Yes
Ningbo Cixi product 25 interest
Sub-branch upon
maturity
Principal
repayme
China
Structure nt with
Construction 2021 2022- Raised
d 10,000.00 all 2.1-3.5% Undue Yes Yes
Bank, Shanghai -2-4 2-4 funds
deposits interest
Branch
upon
maturity
Principal
China repayme
Everbright Bank’s 2021 nt with
Infinit Self-
Bank Co., Ltd., financial 5,000.00 -12- all 3.00% Undue Yes Yes
e funded
Ningbo Cixi product 31 interest
Sub-branch upon
maturity
Annual Report 2021
Principal
Industrial and
repayme
Commercial
Structure nt with
Bank of China 2021 2022- Self-
d 50,000.00 all 1.5-3.8% Undue Yes Yes
Limited, Cixi -6-1 11-17 funded
deposits interest
Henghe Sub-
upon
branch
maturity
China Principal
Merchants repayme
Bank Co., Ltd., Bank’s 2021 nt with
Infinit Self-
Ningbo financial 12,520.00 -12- all 2.80% Undue Yes Yes
e funded
Hangzhou Bay product 29 interest
New Area Sub- upon
branch maturity
Principal
repayme
Securitie
Xingye 2021 nt with
s firm’s 2022- Raised 0.5%-
Securities Co., 10,000.00 -12- all Undue Yes Yes
financial 6-23 funds 5.9%
Ltd. 23 interest
product
upon
maturity
Principal
Shanghai repayme
Securitie
Yongzheng 2021 nt with
s firm’s 2022- Self-
Asset 20,000.00 -8- all 4.80% Undue Yes Yes
financial 8-30 funded
Management 30 interest
product
Co., Ltd. upon
maturity
Principal
repayme
Shanghai Securitie
Haitong Asset s firm’s 2022- Self-
Management financial 7-6 funded
Co., Ltd. product
upon
maturity
Principal
repayme
Shanghai 2021
Trust Infinit Self- nt with
International 4,000.00 -10- 4.60% Undue Yes Yes
product e funded all
Trust Co., Ltd. 26
interest
upon
Annual Report 2021
maturity
Principal
repayme
Shanghai nt with
Trust 2021 2022- Self-
International 20,000.00 all 4.65% Undue Yes Yes
product -7-7 7-6 funded
Trust Co., Ltd. interest
upon
maturity
Principal
Shanghai repayme
Securitie
Everbright 2021 nt with
s firm’s 142,000.0 2023- Self- 4.5%-
Securities Asset -4- all Undue Yes Yes
financial 0 1-31 funded 5.15%
Management 23 interest
product
Co., Ltd. upon
maturity
Principal
repayme
Bank of
Bank’s 2020 nt with
Ningbo Co., 2023- Self-
financial 97,000.00 -8- all 3.6-4.6% Undue Yes Yes
Ltd., Cixi Sub- 10-25 funded
product 12 interest
branch
upon
maturity
Principal
repayme
Lujiazui 2021 nt with
Trust 2022- Self- 5.05%-
International 35,000.00 -1- all Undue Yes Yes
product 1-17 funded 5.3%
Trust Co., Ltd. 14 interest
upon
maturity
Principal
Bank of repayme
Communicatio Structure 2021 nt with
ns, Ningbo d 20,000.00 -1- all 1.75-3.2% Undue Yes Yes
Xincheng Sub- deposits 21 interest
branch upon
maturity
Huatai Principal
Securitie
Securities 2021 repayme
s firm’s 2022- Self-
(Shanghai) 40,000.00 -7- nt with 4.80% Undue Yes Yes
financial 9-6 funded
Asset 13 all
product
Management interest
Annual Report 2021
Co., Ltd. upon
maturity
Principal
repayme
Huaneng 2021 nt with
Trust 2022- Self-
Guicheng Trust 30,000.00 -8- all 6.00% Undue Yes Yes
product 8-25 funded
Co., Ltd. 19 interest
upon
maturity
Principal
repayme
Securitie
Everbright 2021 nt with
s firm’s 2022- Raised 1.8%-
Securities Co., 5,000.00 -11- all Undue Yes Yes
financial 2-11 funds 6.3%
Ltd. 10 interest
product
upon
maturity
Principal
repayme
China
Structure 2020 nt with
Everbright Infinit Self-
d 1.00 -12- all 1.50% Undue Yes Yes
Bank, Minhang e funded
deposits 21 interest
Sub-branch
upon
maturity
Principal
repayme
Everbright 2021 nt with
Trust 2022- Self-
Xinglong Trust 20,000.00 -1- all 5.35% Undue Yes Yes
product 3-24 funded
Co., Ltd. 14 interest
upon
maturity
Principal
Industrial and repayme
Commercial Bank’s 2019 nt with
Infinit Self- 2.24%-
Bank of China, financial 1,690.00 -9- all Undue Yes Yes
e funded 2.27%
Xinzhuang product 16 interest
Sub-branch upon
maturity
Securitie Principal
Founder 2021
s firm’s 2022- Self- repayme
Securities Co., 10,000.00 -11- 4.50% Undue Yes Yes
financial 11-10 funded nt with
Ltd. 10
product all
Annual Report 2021
interest
upon
maturity
Principal
repayme
Securitie
Founder 2021 nt with
s firm’s 2022- Raised
Securities Co., 5,000.00 -12- all 3.90% Undue Yes Yes
financial 9-8 funds
Ltd. 28 interest
product
upon
maturity
Other information:
□ Applicable √ Not applicable
(3) Impairment allowances for wealth management entrustment
□ Applicable √ Not applicable
(1) Total Entrusted Loans
□ Applicable √ Not applicable
Other information:
□ Applicable √ Not applicable
(2) Single Entrustment Loans
□ Applicable √ Not applicable
Other information:
□ Applicable √ Not applicable
(3) Impairment allowances for entrusted loans
□ Applicable √ Not applicable
□ Applicable √ Not applicable
(IV) Other significant contracts
□ Applicable √ Not applicable
XIV Other Significant Events for Investors’ Judgement of Value and Investment Decision-making
□ Applicable √ Not applicable
Annual Report 2021
Part VII Changes in Ordinary Shares and Information about Shareholders
I Share Changes
(I) Share changes
Unit: share
Before Increase/decrease in the current period (+/-) After
Bonus
Bonus issue
Percentage issue Percentage
Shares New issue from capital Other Subtotal Shares
(%) from (%)
reserves
profit
I Restricted
shares
by the state
by state-owned
corporations
by other
domestic
investors
Including:
Shares held by
domestic
corporations
Shares held by
domestic 194,794,721 32.43 668,400 -769,723 -101,323 194,693,398 32.38
individuals
by overseas
investors
Including:
Annual Report 2021
Shares held by
overseas
corporations
Shares held by
overseas
individuals
II Unrestricted
shares
denominated 60,000,000 9.99 15,601,014 15,601,014 75,601,014 12.58
ordinary shares
listed foreign
shares
listed foreign
shares
III Total shares 600,613,800 100.00 668,400 -101,680 566,720 601,180,520 100.00
√ Applicable □ Not applicable
(1) The 15,385,494 IPO restricted shares in total held by four shareholders, Zhuhai Hillhouse Daoying Investment Partnership (Limited Partnership), Shenzhen
Xiaozhou Investment Co., Ltd., Cixi Bowei Investment Partnership (Limited Partnership) (later renamed as Anji Bowei Enterprise Management Partnership
(Limited Partnership)) and Sun Rongfei, were traded in the market on 8 February 2021 upon the expiry of the lock-up period. For details, please refer to the
Announcement of Gongniu Group on the Trading in the Market of Some IPO Restricted Shares (Announcement No.: 2021-012) disclosed by the Company on the
website of the Shanghai Stock Exchange (www.sse.com.cn) on 30 January 2021.
(2) 21 incentive targets including Wu Jun had lost their qualification for the share incentive due to their departure from the Company, and the Company
repurchased and canceled 37,900 restricted shares held by them which had been granted but not lifted from restricted sales on 10 February 2021. For details, please
refer to the Announcement of Gongniu Group on the Repurchase and Cancellation of Some Restricted Incentive Shares (Announcement No.: 2021-014) disclosed by
the Company on the website of the Shanghai Stock Exchange (www.sse.com.cn) on 6 February 2021.
Annual Report 2021
(3) Repurchase and cancellation of some restricted incentive shares
According to the provisions of the 2020 Restricted Share Incentive Scheme (Draft) of Gongniu Group Co., Ltd., 21 incentive targets including Wen Bin had
lost the incentive qualification of the Incentive Scheme due to their departure from the Company, and the Company completed the repurchase and cancellation of
number of shares of the Company was changed from 600,575,900 shares to 600,544,900 shares. For details, please refer to the Announcement of Gongniu Group on
the Repurchase and Cancellation of Some Restricted Incentive Shares (Announcement No.: 2021-064) disclosed by the Company on the website of the Shanghai
Stock Exchange (www.sse.com.cn) on 30 June 2021.
(4) Grant of 2021 Restricted Share Incentive Scheme
On 28 April 2021, the Company held the 3rd Meeting of the 2nd Board of Directors and the 3rd Meeting of the 2nd Supervisory Committee, and reviewed and
approved the Proposal on the Restricted Share Incentive Scheme for 2021 (Draft) and its Summary of the Company and the Proposal on the Management Measures
for the Assessment of the Restricted Share Incentive Scheme for 2021. The grant date of the restricted shares was 4 June 2021, and Pan-China Certified Public
Accountants LLP issued the Capital Verification Report of Gongniu Group Co., Ltd. (T.J.Y. [2021] No. 343) on 5 July 2021, which verified the newly registered
capital and paid-in share capital as at 22 June 2021. The Company has received a total amount of RMB58,919,460.00 from 523 incentive targets for the subscription
of restricted shares in monetary assets. Of this amount, RMB668,400.00 is included in paid-in share capital and RMB58,251,060.00 is included in capital reserves
(share capital premium).
On 15 July 2021, the Company completed the registration of the grant of the 2021 Restricted Share Incentive Scheme and granted a total of 668,400 restricted
shares to 523 incentive targets, increasing the total share capital of the Company from 600,544,900 shares to 601,213,300 shares. For details, please refer to the
Announcement of Gongniu Group on the Grant Results of the 2021 Restricted Share Incentive Scheme (Announcement No.: 2021-072) disclosed by the Company
on the website of the Shanghai Stock Exchange (www.sse.com.cn) on 17 July 2021.
(5) Repurchase and cancellation of some restricted incentive shares
According to the provisions of the 2020 Restricted Share Incentive Scheme (Draft) of Gongniu Group Co., Ltd. and 2021 Restricted Share Incentive Scheme
(Draft Revised) of Gongniu Group Co., Ltd., 28 incentive targets including Zhang Hong and Wang Na had lost the incentive qualification of the Incentive Scheme
due to their departure from the Company, and the Company completed the repurchase and cancellation of 32,780 restricted shares held by them which had been
granted but not lifted from restricted sales on 24 December 2021. Upon completion of the cancellation, the total number of shares of the Company was changed
Annual Report 2021
from 601,213,300 to 601,180,520 shares. For details, please refer to the Announcement of Gongniu Group on the Repurchase and Cancellation of Some Restricted
Incentive Shares (Announcement No.: 2021-110) disclosed by the Company on the website of the Shanghai Stock Exchange (www.sse.com.cn) on 22 December
period (if any)
√ Applicable □ Not applicable
During the Reporting Period, the Company’s share capital changed from 600,613,800 shares to 601,180,500 shares due to the grant of restricted shares. If the
impact of this change is not taken into account, based on the share capital of 600,613,800 shares before the change, the basic earnings per share and net asset value
per share for 2021 would be RMB4.63 per share and RMB17.90 per share, respectively; based on the total share capital of 601,180,500 shares at the end of the year,
the basic earnings per share and net asset value per share for 2021 would be RMB4.63 per share and RMB17.88 per share, respectively.
□ Applicable √ Not applicable
(II) Change of restricted shares
√ Applicable □ Not applicable
Unit: Share
Number of shares
Number of new
Opening lifted from Closing restricted Reasons for Date of lifting
Name of shareholder restricted shares
restricted shares restrictions shares restricted sales restrictions
during the year
during the year
Zhuhai Hillhouse Daoying Investment 8 February
Partnership (Limited Partnership) 2021
Shenzhen Xiaozhou Investment Co., Ltd. 1,508,385 1,508,385 0 0 IPO
Cixi Bowei Investment Partnership (Limited 8 February
Partnership) [Note 1] 2021
Sun Rongfei 452,523 452,523 0 0 IPO
Incentive targets of the 2020 Share Incentive 317,200 Restricted 9 July 2021
Scheme [Note 2] shares granted 6 July 2022
Annual Report 2021
to share 6 July 2023
incentive
recipients
during the lock-
up period
Restricted
shares granted
to share 15 July 2022
Incentive targets of the 2021 Share Incentive
Scheme
recipients 15 July 2024
during the lock-
up period
Total 15,999,294 15,702,694 668,400 965,000 / /
Note 1: Cixi Bowei Investment Partnership (Limited Partnership) was subsequently renamed as Anji Bowei Enterprise Management Partnership (Limited
Partnership)
Note 2: Of which, the number of restricted shares lifted from restriction and traded in the market was 215,520 shares and the number of restricted shares repurchased
and canceled by the Company was 101,680 shares.
II Issuance and Listing of Securities
(I) Securities issued during the Reporting Period
√ Applicable □ Not applicable
Unit: Share Currency: RMB
Number of shares
Class of stock and its Issue price (or interest Number of Final trading
Issue date Listing date allowed for public
derivative securities rate) shares issued date
trading
Ordinary share
Restricted share
(A-stock)
Description of securities issued during the Reporting Period (for bonds with different interest rates over the lifetime, please specify separately):
√ Applicable □ Not applicable
The registration date of the Company's 2021 Restricted Share Incentive Scheme is 15 July 2021, with a total of 668,400 restricted shares granted to 523
incentive targets, and the unlocking dates are 12 months, 24 months and 36 months respectively from the date of completion of registration of the grant, and the
proportion of unlocked shares for each period is 40%, 30% and 30%.
Annual Report 2021
(II) Changes in Total Shares and Shareholder Structure, as well as in Asset and Liability Structures
√ Applicable □ Not applicable
For changes in the shareholder structure, see “(I) Share changes” under “I Share Changes” of “Part VII Share in Ordinary Shares and Information about
Shareholders”.
For changes in asset and liabilities structures, see “(III) Analysis of assets and liabilities” under “V Business Overview for the Reporting Period” of “Part III
Management Discussion and Analysis”.
(III) Existing staff-held shares
□ Applicable √ Not applicable
Annual Report 2021
III Shareholders and Actual Controller
(I) Total number of shareholders
Number of ordinary shareholders at the period-end 29,644
Number of ordinary shareholders at the month-end
prior to the disclosure of this Report
Number of preference shareholders with resumed
voting rights at the period-end
Number of preference shareholders with resumed
voting rights at the month-end prior to the 0
disclosure of this Report
(II) Top 10 shareholders and public shareholders (or unrestricted shareholders) at the period-end
Unit: share
Top 10 shareholders
Shareholding Shares in
Shareholdin
Full name increase/decrea Closing pledge, marked Nature of
g Restricted
of se in the shareholdin or frozen sharehold
percentage shares held
shareholder Reporting g Share er
(%) Status
Period s
Domestic
Ningbo
non-state-
Liangji 324,000,00 324,000,00
Industrial 0 0
corporatio
Co., Ltd.
n
Ruan Domestic
Xueping individual
Ruan Domestic
Liping individual
Hong Kong
Securities
Clearing 13,777,768 14,042,552 2.34 0 N/A 0 Unknown
Company
Limited
Ningbo
Ninghui
Investment
Manageme
nt 0 4,072,954 0.68 4,072,954 N/A 0 Other
Partnership
(Limited
Partnership
)
China
Merchants
Bank Co.,
Ltd.－
Xingquan 3,470,675 3,470,675 0.58 0 N/A 0 Unknown
Herun
Mixed
Securities
Investment
Fund
Annual Report 2021
Zhuhai
Hillhouse
Daoying
Investment
Partnership
(Limited
Partnership
)
China
Merchants
Bank Co.,
Ltd.－
Xingquan
Heyi
Dynamic
Asset
Allocation
Mixed
Securities
Investment
Fund
(LOF)
Schroder
Investment
Manageme
nt (Hong
Kong)
Limited－
Schroder
Internation
al Selection
Fund -
Emerging
Asia (ETF)
Industrial
Bank Co.,
Ltd.－
Xingquan
New View
Dynamic
Asset
Allocation 1,868,375 1,868,375 0.31 0 N/A 0 Unknown
Regularly
Open-
ended
Mixed
Initiated
Securities
Investment
Fund
Top 10 unrestricted shareholders
Type and number of shares
Name of shareholder Unrestricted public shares held
Class Shares
Annual Report 2021
RMB-
Hong Kong Securities denominate
Clearing Company Limited d ordinary
stock
China Merchants Bank Co., RMB-
Ltd.－Xingquan Herun denominate
Mixed Securities Investment d ordinary
Fund stock
RMB-
Zhuhai Hillhouse Daoying
denominate
Investment Partnership 3,286,365 3,286,365
d ordinary
(Limited Partnership)
stock
China Merchants Bank Co.,
RMB-
Ltd.－Xingquan Heyi
denominate
Dynamic Asset Allocation 2,600,615 2,600,615
d ordinary
Mixed Securities Investment
stock
Fund (LOF)
Schroder Investment
Management (Hong Kong) RMB-
denominate
Limited－Schroder 2,465,095 2,465,095
d ordinary
International Selection Fund -
stock
Emerging Asia (ETF)
Industrial Bank Co., Ltd.－
Xingquan New View RMB-
Dynamic Asset Allocation denominate
Regularly Open-ended Mixed d ordinary
Initiated Securities stock
Investment Fund
China Everbright Bank
RMB-
Company Limited Co., Ltd.
denominate
－Xingquan Business Model 1,514,643 1,514,643
d ordinary
Selected Mixed Securities stock
Investment Fund (LOF)
Schroder Investment
RMB-
Management (Hong Kong)
denominate
Limited－Schroder 1,076,041 1,076,041
d ordinary
International Selection Fund - stock
Greater China (ETF)
RMB-
Basic Endowment Insurance denominate
Fund—Portfolio 807 d ordinary
stock
Schroder Investment
Management (Hong Kong) RMB-
denominate
Limited－Schroder 892,520 892,520
d ordinary
International Selection Fund - stock
China A (ETF)
Share repurchase account
among the top 10 Not applicable
shareholders
Shareholders above
entrusting/entrusted with or Not applicable
waiving voting rights
Annual Report 2021
Ruan Liping and Ruan Xueping are brothers and acting-in-concert
parties. They jointly control Ningbo Liangji Industrial Co., Ltd., the
Company’s controlling shareholder. Ningbo Meishan Bonded Port Area
Shuo Jin Investment Management Co., Ltd., under the joint control of
Related or acting-in-concert
Ruan Liping and Ruan Xueping, is an executive partner of Ningbo
parties among shareholders
Ninghui Investment Management Partnership (Limited Partnership),
above
one of the Company’s shareholders. Save as disclosed above, the
Company is not aware of any other related parties or acting-in-concert
parties as defined in the Administration Methods for Acquisition of
Listed Companies among the shareholders above.
Preference shareholders with
resumed voting rights and Not applicable
their shareholdings
Shareholdings of the top 10 restricted shareholders and the restrictions:
√ Applicable □ Not applicable
Unit: share
Restricted shares
allowed for public
trading
Increas
e in
Name of restricted Restricted restrict
No. Date when Restriction
shareholder shares held ed
public
shares
trading is
allowed
allowed
for
public
trading
Co., Ltd. months from the IPO
Ruan Xueping 96,864,199 2023-02-06 0
months from the IPO
Ruan Liping 96,864,199 2023-02-06 0
months from the IPO
Investment Management months from the IPO
Partnership (Limited
Partnership)
Investment Management months from the IPO
Partnership (Limited
Partnership)
Investment Management months from the IPO
Partnership (Limited
Partnership)
granted as equity
of the shares is
awardee
Annual Report 2021
granted as equity
of the shares is
awardee
granted as equity
date when ownership
of the shares is
registered under the
awardee
granted as equity
date when ownership
of the shares is
registered under the
awardee
Ruan Liping and Ruan Xueping are brothers and acting-in-concert
parties. They jointly control Ningbo Liangji Industrial Co., Ltd.,
the Company’s controlling shareholder. Ningbo Meishan Bonded
Port Area Shuo Jin Investment Management Co., Ltd., under the
joint control of Ruan Liping and Ruan Xueping, is an executive
partner of Ningbo Ninghui Investment Management Partnership
(Limited Partnership) and Ningbo Suiyuan Investment
Management Partnership (Limited Partnership), both shareholders
of the Company. Save as disclosed above, the Company is not
aware of any other related parties or acting-in-concert parties as
defined in the Administration Methods for Acquisition of Listed
Companies among the shareholders above. The Company’s
Related or acting-in-concert
shareholder Ningbo Qiyuanbao Investment Management
parties among shareholders
Partnership (Limited Partnership) is under the control of Ruan
above
Shuhong and Zhu Funing, both near relatives of Ruan Liping. Cai
Yingfeng, a director of the Company, is a limited partner of the
Company’s shareholder Ningbo Suiyuan Investment Management
Partnership (Limited Partnership). Li Guoqiang, a senior executive
of the Company, is a limited partner of the Company’s shareholder
Ningbo Suiyuan Investment Management Partnership (Limited
Partnership). Wang Qingwang is a limited partner of the
Company’s shareholder Ningbo Suiyuan Investment Management
Partnership (Limited Partnership). Save as disclosed above, the
Company is not aware of any other related parties or acting-in-
concert parties as defined in the Administration Methods for
Acquisition of Listed Companies among the shareholders above.
Annual Report 2021
(III) Indicate whether any strategic investor or general corporation has become a top-10
shareholder in a rights issue.
□ Applicable √ Not applicable
IV Controlling Shareholder and Actual Controller
(I) Controlling shareholder
√ Applicable □ Not applicable
Name Ningbo Liangji Industrial Co.,
Ltd.
Legal representative/company principal Ruan Liping
Date of establishment 23 November 2011
Principal activities Investment management
Interests held in other domestically and overseas listed
Not applicable
companies in the Reporting Period
Other information Not applicable
□ Applicable √ Not applicable
□ Applicable √ Not applicable
□ Applicable √ Not applicable
√ Applicable □ Not applicable
Ningbo Liangji Industrial Co., Ltd.
Gongniu Group Co., Ltd.
(II) Actual controller
□ Applicable √ Not applicable
√ Applicable □ Not applicable
Name Ruan Liping
Nationality Chinese
Residency in other countries or regions
Yes
(yes/no)
Chairman of the Board and President of Gongniu Group
Main occupations and positions
Co., Ltd.
Controlling interests in other domestically
and overseas listed companies in the past Not applicable
Name Ruan Xueping
Nationality Chinese
Residency in other countries or regions
Yes
(yes/no)
Annual Report 2021
Vice Chairman of the Board of Gongniu Group Co.,
Main occupations and positions Ltd. and General Manager of Shanghai Gongniu
Electrics Co., Ltd.
Controlling interests in other domestically
and overseas listed companies in the past Not applicable
□ Applicable √ Not applicable
□ Applicable √ Not applicable
√ Applicable □ Not applicable
Ruan Liping Ruan Xueping
Ningbo Meishan Bonded Port Area Shuo
Jin Investment Management Co., Ltd.
Ningbo Liangji Industrial Co., Ltd.
Gongniu Group Co., Ltd.
management.
□ Applicable √ Not applicable
(III) Other information about the controlling shareholder and the actual controller
□ Applicable √ Not applicable
V Indicate whether the cumulative number of shares put in pledge by the Company’s controlling
shareholder or the largest shareholder and its acting-in-concert parties accounts for over 80% of
their shareholdings in the Company.
□ Applicable √ Not applicable
VI Other 10% or Greater Corporate Shareholders
□ Applicable √ Not applicable
VII Restrictions on Shareholding Reduction
□ Applicable √ Not applicable
VIII Share Repurchases during the Reporting Period
□ Applicable √ Not applicable
Part VIII Relevant Information of Preference shares
□ Applicable √ Not applicable
Annual Report 2021
Part IX Relevant Information of Corporate Bonds
I Enterprise Bonds, Corporate Bonds and Debt Financing Instruments of Non-financial
Enterprise
□ Applicable √ Not applicable
II Convertible Corporate Bonds
□ Applicable √ Not applicable
Part X Financial Statements
I Independent Auditor’s Report
√ Applicable □ Not applicable
Independent Auditor’s Report
PCCPA Audit〔2022〕No. 2228
To the shareholders of Gongniu Group Co., Ltd.:
I Opinion
We have audited the financial statements of Gongniu Group Co., Ltd. (“Gongniu” or the
“Company”), which comprise the consolidated and parent company (the Company as the parent
exclusive of subsidiaries) balance sheets as at 31 December 2021, the consolidated and parent company
statements of income, cash flows and changes in owners’ equity for the year then ended, as well as the
notes to the financial statements.
In our opinion, the financial statements referred to above present fairly, in all material respects, the
consolidated and parent company financial position of the Company at 31 December 2021, and the
consolidated and parent company operating results and cash flows for the year then ended, in conformity
with the Chinese Accounting Standards (CAS).
II Basis for Opinion
We conducted our audits in accordance with the Audit Standards for Chinese Registered
Accountants. Our responsibilities under those standards are further described in the Auditor’s
Responsibilities for Audit of Financial Statements section of our report. We are independent of the
Company in accordance with the China Code of Ethics for Certified Public Accountants, and we have
fulfilled our other ethical responsibilities in accordance with the said Code of Ethics. We believe that the
audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
III Key Audit Matters
Key audit matters are matters that, based on our professional judgment, are deemed most important
to the audit of the financial statements of the current period. These matters were addressed in the context
of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not
provide a separate opinion on these matters.
(I) Revenue recognition
Annual Report 2021
For relevant information disclosed, please refer to "38. Revenue" in "V Significant Accounting
Policies and Accounting Estimates" and "61. Operating revenue and cost of sales" in "VII Notes to the
Consolidated Financial Statements" of "Part X Financial Statements".
The revenue of Gongniu Group is mainly derived from the sale of adaptors, wall switches, LEDs
and digital accessories. In 2021, Gongniu Group achieved operating revenue of RMB12.385 billion.
Gongniu Group has identified different specific methods of revenue recognition for different sales
methods.
As operating revenue is one of the key performance indicators of Gongniu Group, we have
identified revenue recognition as a key audit matter.
The audit procedures we performed in relation to revenue recognition primarily include:
those controls, determining whether they are implemented and testing the effectiveness of the operation
of the relevant internal controls;
recognition policy is in line with the provisions of the Accounting Standard for Business Enterprises;
monthly, product and customer basis to identify any significant or abnormal fluctuations and analyze the
causes of fluctuations;
revenue recognition, including sales contracts, orders, sales invoices, outbound delivery orders, delivery
notes, transportation orders and customer sign-off sheets; for export revenue, obtaining electronic port
information and reconciling it with the carrying records, and checking supporting documents such as
sales contracts, export customs declarations, freight bills of lading and sales invoices on a sample basis;
accounts receivable letter;
supporting documents such as outbound delivery orders, delivery notes, customer sign-off sheets and
freight bills of lading, and evaluating whether operating revenue is recognized in the appropriate period;
financial statements.
(II) Recognition, measurement and presentation of wealth management products
For relevant information disclosed, please refer to "10. Financial instruments" in "V Significant
Accounting Policies and Accounting Estimates" and "2. "Held-for-trading financial assets", "13. Other
current assets" and "68. Return on investment" in "VII Notes to the Consolidated Financial Statements"
of "Part X Financial Statements".
Annual Report 2021
As at 31 December 2021, the wealth management balance of held-for-trading financial assets of
Gongniu Group was RMB5,927 million, the wealth management balance of other current assets was
RMB1,115 million, and the cumulative return on investment for wealth management products in 2021
amounted to RMB172 million. We determined the recognition, measurement and presentation of wealth
management products as a key audit matter due to the large amount of wealth management products and
the fact that the return on investment of the relevant products is an important item in the net profit of
Gongniu Group for 2021.
The audit procedures we performed in relation to the recognition, measurement and presentation of
wealth management products primarily include:
(1) Understanding the key internal controls relating to investments in wealth management products,
evaluating the design of those controls, determining whether they are implemented and testing the
effectiveness of the operation of the relevant internal controls;
(2) Checking whether the classification of wealth management products is correct based on the
contractual cash flow characteristics of the wealth management products and the business model of
Gongniu Group in managing the wealth management products;
(3) Obtaining statements of account related to wealth management products, reconciling them with
the carrying amount and writing to banks, securities companies and trust companies to confirm the asset
balance and the existence of balances of wealth management products;
(4) Checking the supporting documents for increase and reduction in wealth management products
during the period on a sample basis, checking whether they have been authorized and approved, and
confirming that the amounts relating to the purchase, sale and return on investment of wealth
management products are correct and fully recorded;
(5) Reviewing the valuation method of wealth management products to check whether the basis for
obtaining their fair value, the measurement of their value at the end of the period and the accounting
treatment are correct;
(6) Checking whether information related to the recognition, measurement and presentation of
wealth management products has been properly presented in the financial statements.
IV Other Information
The Company’s management is responsible for the other information. The other information
comprises all of the information included in the Company’s 2021 Annual Report other than the financial
statements and our auditor’s report thereon.
Our opinion on the financial statements does not cover the other information and we do not express
any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent with the
financial statements or our knowledge obtained in the audit or otherwise appears to be materially
misstated.
Annual Report 2021
If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
V Responsibilities of Management and Those Charged with Governance for Financial
Statements
The Company’s management is responsible for the preparation of the financial statements that give
a fair view in accordance with CAS, and for designing, implementing and maintaining such internal
control as the management determines is necessary to enable the preparation of financial statements that
are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the management is responsible for assessing the Company’s
ability to continue as a going concern, disclosing, as applicable, matters related to going concern (if
applicable) and using the going concern basis of accounting unless the management either intends to
liquidate the Company or to cease operations, or have no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Company’s financial reporting
process.
VI Auditor’s Responsibilities for Audit of Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole
are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with CAS will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on the
basis of these financial statements.
As part of an audit in accordance with CAS, we exercise professional judgment and maintain
professional skepticism throughout the audit. We also:
(I) Identify and assess the risks of material misstatement of the financial statements, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence
that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material
misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve
collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
(II) Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances.
(III) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the management.
(IV) Conclude on the appropriateness of the management’s use of the going concern basis of
accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to
events or conditions that may cast significant doubt on the Company’s ability to continue as a going
concern. If we conclude that a material uncertainty exists, we are required by CAS to draw users’
attention in our auditor’s report to the related disclosures in the financial statements or, if such
Annual Report 2021
disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence
obtained up to the date of our auditor’s report. However, future events or conditions may cause the
Company to cease to continue as a going concern.
(V) Evaluate the overall presentation, structure and content of the financial statements, and whether
the financial statements represent the underlying transactions and events in a manner that achieves fair
presentation.
(VI) Obtain sufficient appropriate audit evidence regarding the financial information of the entities
or business activities within the Company to express an opinion on the financial statements. We are
responsible for the direction, supervision and performance of the Company audit. We remain solely
responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned
scope and timing of the audit and significant audit findings, including any noteworthy deficiencies in
internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with
relevant ethical requirements regarding independence, and communicate with them all relationships and
other matters that may reasonably be thought to bear on our independence, and where applicable, related
safeguards.
From the matters communicated with those charged with governance, we determine those matters
that were of most significance in the audit of the financial statements of the current period and are
therefore the key audit matters. We describe these matters in our auditor’s report unless law or
regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we
determine that a matter should not be communicated in our report because the adverse consequences of
doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Pan-China Certified Public Accountants LLP Chinese certified public accountant: Qian Zhongxian
(engagement partner)
Hangzhou·China Chinese certified public accountant: Chen Hui
Annual Report 2021
II Financial Statements
Consolidated Balance Sheet
Prepared by Gongniu Group Co., Ltd.
Unit: RMB
Item Note 31 December 2021 31 December 2020
Current assets：
Monetary assets 4,377,228,556.74 3,752,857,861.42
Settlement reserve
Loans to other banks and
financial institutions
Held-for-trading financial
assets
Derivative financial assets 3,613,050.00 27,159,170.00
Notes receivable 750,723.35
Accounts receivable 219,259,743.25 183,928,613.94
Receivables financing 927,023.00 161,562.83
Prepayments 29,140,223.00 34,711,617.31
Premiums receivable
Reinsurance receivables
Receivable reinsurance
contract reserve
Other receivables 195,924,505.99 126,043,394.07
Of which: Interest receivable
Dividends
receivable
Financial assets purchased
under resale agreements
Inventories 1,376,987,122.60 788,240,060.31
Contract assets
Assets held for sale
Current portion of non-
current assets
Other current assets 1,126,520,898.44 2,741,389,939.38
Total current assets 13,256,951,846.37 10,517,792,219.26
Non-current assets：
Loans and advances to
customers
Debt investments
Other debt investments
Long-term receivables
Long-term equity
investments
Other equity investments
Other non-current financial
assets
Investment property
Fixed assets 1,493,733,120.82 1,181,783,418.51
Construction in progress 198,364,136.97 278,130,656.14
Productive living assets
Oil and gas assets
Right-of-use assets 18,809,799.71
Annual Report 2021
Intangible assets 295,769,642.48 299,981,403.19
Development costs
Goodwill
Long-term prepaid expense 17,750,835.99 3,150,000.00
Deferred income tax assets 116,456,369.78 66,903,177.28
Other non-current assets 76,068,914.50 89,800,700.00
Total non-current assets 2,216,952,820.25 1,919,749,355.12
Total assets 15,473,904,666.62 12,437,541,574.38
Current liabilities：
Short-term borrowings 500,430,555.55 500,344,611.11
Borrowings from the central
bank
Loans from other banks and
financial institutions
Held-for-trading financial
liabilities
Derivative financial liabilities
Notes payable 2,333,774.75
Accounts payable 1,701,686,564.14 1,285,822,466.71
Advances from customers
Contract liabilities 437,999,921.93 333,741,780.65
Financial assets sold under
repurchase agreements
Customer deposits and
deposits from other banks and
financial institutions
Payables for acting trading of
securities
Payables for underwriting of
securities
Employee benefits payable 279,463,472.43 244,138,167.00
Taxes and levies payable 533,077,969.51 437,873,048.07
Other payables 430,813,760.10 219,091,086.62
Of which: Interest payable
Dividends payable
Fees and commissions
payable
Reinsurance payables
Liabilities directly associated
with assets held for sale
Current portion of non-
current liabilities
Other current liabilities 56,939,989.86 43,285,234.93
Total current liabilities 4,616,657,945.80 3,064,296,395.09
Non-current liabilities：
Insurance contract reserve
Long-term borrowings 160,037,333.33
Bonds payable
Of which: Preference shares
Perpetual bonds
Lease liabilities 5,089,837.39
Long-term payables
Long-term employee benefits
payable
Annual Report 2021
Provisions
Deferred income
Deferred income tax
liabilities
Other non-current liabilities 46,125,187.50 28,037,156.40
Total non-current
liabilities
Total liabilities 4,718,153,089.99 3,300,149,005.29
Owners’ equity (or shareholders’ equity)：
Paid-in capital (or share
capital)
Other equity instruments
Of which: Preference shares
Perpetual bonds
Capital reserves 3,914,068,288.56 3,820,175,608.14
Less: Treasury shares 80,711,540.00 46,728,594.00
Other comprehensive income 7,537,390.37 28,863,769.91
Specific reserve
Surplus reserves 302,797,998.73 302,797,998.73
General reserve
Retained earnings 6,010,878,918.97 4,431,669,986.31
Total equity attributable to
owners (or shareholders) of the 10,755,751,576.63 9,137,392,569.09
Company as the parent
Non-controlling interests
Total owners’ equity (or
shareholders’ equity)
Total liabilities and
owners’ equity (or 15,473,904,666.62 12,437,541,574.38
shareholders’ equity)
Legal representative: Ruan Liping Chief Financial Officer: Zhang Lina
Head of the financial department: Luo Yuebo
Balance Sheet of the Company as the Parent
Prepared by Gongniu Group Co., Ltd.
Unit: RMB
Item Note 31 December 2021 31 December 2020
Current assets：
Monetary assets 2,815,595,132.13 2,252,978,143.19
Held-for-trading financial
assets
Derivative financial assets
Notes receivable
Accounts receivable 3,783,723.14 12,752,174.13
Receivables financing
Prepayments 302,683,310.52 24,746,283.47
Other receivables 3,038,980,082.79 1,686,576,004.18
Of which: Interest receivable
Dividends 2,000,000,000.00 1,000,000,000.00
receivable
Inventories 409,900,890.43 210,415,165.34
Contract assets
Annual Report 2021
Assets held for sale
Current portion of non-
current assets
Other current assets 610,271,780.82 1,406,276,164.38
Total current assets 8,881,214,919.83 6,723,743,934.69
Non-current assets：
Debt investments
Other debt investments
Long-term receivables
Long-term equity
investments
Other equity investments
Other non-current financial
assets
Investment property
Fixed assets 805,605,614.22 444,710,486.62
Construction in progress 171,842,155.89 272,695,407.86
Productive living assets
Oil and gas assets
Right-of-use assets 7,057,187.09
Intangible assets 258,323,362.23 260,448,329.50
Development costs
Goodwill
Long-term prepaid expense 17,750,835.99 3,150,000.00
Deferred income tax assets 3,735,033.97 1,628,056.37
Other non-current assets 72,827,494.50 68,746,505.00
Total non-current assets 1,779,101,184.06 1,456,435,880.46
Total assets 10,660,316,103.89 8,180,179,815.15
Current liabilities：
Short-term borrowings 500,344,611.11
Held-for-trading financial
liabilities
Derivative financial liabilities
Notes payable 100,000,000.00
Accounts payable 450,634,960.80 350,846,830.56
Advances from customers
Contract liabilities 424,645,030.61 10,061,976.43
Employee benefits payable 101,482,634.41 94,117,188.55
Taxes and levies payable 205,109,507.99 97,437,178.10
Other payables 126,829,316.67 136,920,122.46
Of which: Interest payable
Dividends payable
Liabilities directly associated
with assets held for sale
Current portion of non-
current liabilities
Other current liabilities 55,203,853.98 1,308,056.94
Total current liabilities 2,129,987,141.12 1,191,035,964.15
Non-current liabilities：
Long-term borrowings 160,037,333.33
Bonds payable
Of which: Preference shares
Perpetual bonds
Lease liabilities 2,163,270.25
Annual Report 2021
Long-term payables
Long-term employee benefits
payable
Provisions
Deferred income
Deferred income tax
liabilities
Other non-current liabilities 46,125,187.50 28,037,156.40
Total non-current
liabilities
Total liabilities 2,200,525,337.17 1,395,406,470.19
Owners’ equity (or shareholders’ equity)：
Paid-in capital (or share
capital)
Other equity instruments
Of which: Preference shares
Perpetual bonds
Capital reserves 3,909,568,864.90 3,815,676,184.48
Less: Treasury shares 80,711,540.00 46,728,594.00
Other comprehensive income
Specific reserve
Surplus reserves 302,797,998.73 302,797,998.73
Retained earnings 3,726,954,923.09 2,112,413,955.75
Total owners’ equity (or
shareholders’ equity)
Total liabilities and
owners’ equity (or 10,660,316,103.89 8,180,179,815.15
shareholders’ equity)
Legal representative: Ruan Liping Chief Financial Officer: Zhang Lina
Head of the financial department: Luo Yuebo
Consolidated Income Statement
January-December 2021
Unit: RMB
Item Note 2021 2020
I Total revenues 12,384,916,337.51 10,051,128,834.05
Of which: Operating revenue 12,384,916,337.51 10,051,128,834.05
Interest income
Insurance premium income
Fee and commission
income
II Total costs and expenses 9,262,301,258.59 7,412,932,169.72
Of which: Cost of sales 7,808,540,666.84 6,018,606,539.57
Interest expense
Fee and commission
expense
Surrenders
Net insurance claims paid
Net amount provided as
insurance contract reserve
Expenditure on policy
dividends
Annual Report 2021
Reinsurance premium
expense
Taxes and levies 82,785,296.48 80,328,346.74
Selling expense 560,187,002.80 517,846,532.13
Administrative expense 427,615,556.97 430,706,547.54
R&D expense 471,015,016.82 401,181,690.28
Finance costs -87,842,281.32 -35,737,486.54
Of which: Interest expense 39,763,491.76 9,718,888.89
Interest income 128,887,165.64 49,748,785.37
Add: Other income 390,936,141.47 127,179,310.75
Return on investment (“－”
for loss)
Of which: Share of profit or
loss of joint ventures and associates
Income from the
derecognition of financial assets at
amortized cost
Exchange gain (“－” for loss)
Net gain on exposure hedges
(“－” for loss)
Gain on changes in fair value
(“－” for loss)
Credit impairment loss (“－”
-24,746,561.94 -7,435,665.10
for loss)
Asset impairment loss (“－”
-16,257,123.26 -6,675,595.59
for loss)
Asset disposal income (“－”
-11,308,464.89 -669,979.13
for loss)
III Operating profit (“－” for loss) 3,651,264,379.11 2,802,597,335.96
Add: Non-operating income 4,353,269.76 2,982,456.22
Less: Non-operating expense 330,657,723.91 50,914,854.15
IV Gross profit (“－” for gross loss) 3,324,959,924.96 2,754,664,938.03
Less: Income tax expense 544,599,192.30 441,234,863.89
V Net profit (“－” for net loss) 2,780,360,732.66 2,313,430,074.14
(I) By operating continuity
operations (“－” for net loss)
operations (“－” for net loss)
(II) By ownership
owners of the Company as the parent 2,780,360,732.66 2,313,430,074.14
(“－” for net loss)
controlling interests (“－” for net loss)
VI Other comprehensive income, net
-21,326,379.54 28,853,958.05
of tax
(I) Other comprehensive income,
net of tax attributable to owners of the -21,326,379.54 28,853,958.05
Company as the parent
that will not be reclassified to profit or
loss
Annual Report 2021
（1）Changes caused by
remeasurements on defined benefit
schemes
（2）Other comprehensive income
that will not be reclassified to profit or
loss under the equity method
（3）Changes in the fair value of
other equity investments
（4）Changes in the fair value
arising from changes in own credit
risk
that will be reclassified to profit or -21,326,379.54 28,853,958.05
loss
（1）Other comprehensive income
that will be reclassified to profit or
loss under the equity method
（2）Changes in the fair value of
other debt investments
（3）Other comprehensive income
arising from the reclassification of
financial assets
（4）Credit impairment allowance
for other debt investments
（5）Reserve for cash flow hedges -21,324,986.08 28,871,218.29
（6）Differences arising from the
translation of foreign currency- -1,393.46 -17,260.24
denominated financial statements
（7）Others
(II) Other comprehensive income,
net of tax attributable to non-
controlling interests
VII Total comprehensive income 2,759,034,353.12 2,342,284,032.19
(I) Total comprehensive income
attributable to owners of the Company 2,759,034,353.12 2,342,284,032.19
as the parent
(II) Total comprehensive income
attributable to non-controlling
interests
VIII Earnings per share：
(I) Basic earnings per share
(RMB/share)
(II) Diluted earnings per share
(RMB/share)
Where business combinations involving entities under common control occurred in the current period,
the net profit achieved by the acquirees before the combinations was RMB0.00, with the amount for last
year being RMB0.00.
Legal representative: Ruan Liping Chief Financial Officer: Zhang Lina
Head of the financial department: Luo Yuebo
Annual Report 2021
Income Statement of the Company as the Parent
January-December 2021
Unit: RMB
Item Note 2021 2020
I Operating revenue 5,306,290,224.15 4,431,826,844.17
Less: Cost of sales 3,876,062,056.48 3,200,232,443.74
Taxes and levies 27,736,575.48 28,032,068.03
Selling expense 22,442,913.93 41,230,202.68
Administrative expense 237,296,868.57 227,914,385.78
R&D expense 190,443,988.85 163,577,005.90
Finance costs -31,504,593.32 -16,888,303.67
Of which: Interest expense 24,790,531.90 6,413,194.44
Interest income 56,305,098.21 23,400,740.83
Add: Other income 266,969,614.03 19,424,769.79
Return on investment (“－” for
loss)
Of which: Share of profit or
loss of joint ventures and associates
Income from the
derecognition of financial assets at
amortized cost
Net gain on exposure hedges
(“－” for loss)
Gain on changes in fair value
(“－” for loss)
Credit impairment loss (“－”
-18,213,104.15 -37,097,495.37
for loss)
Asset impairment loss (“－”
-2,744,147.10 -541,797.39
for loss)
Asset disposal income (“－”
-3,937,217.96 -18,183.95
for loss)
II Operating profit (“－” for loss) 3,305,011,976.56 1,818,079,769.43
Add: Non-operating income 602,007.58 438,745.58
Less: Non-operating expense 317,803,063.92 30,606,525.57
III Gross profit (“－” for gross loss) 2,987,810,920.22 1,787,911,989.44
Add: Income tax expense 172,118,152.88 108,900,526.54
IV Net profit (“－” for net loss) 2,815,692,767.34 1,679,011,462.90
(I) Net profit from continuing
operations (“－” for net loss)
(II) Net profit from discontinued
operations (“－” for net loss)
V Other comprehensive income, net of
tax
(I) Other comprehensive income
that will not be reclassified to profit or
loss
remeasurements on defined benefit
schemes
that will not be reclassified to profit or
loss under the equity method
other equity investments
Annual Report 2021
arising from changes in own credit risk
(II) Other comprehensive income
that will be reclassified to profit or
loss
that will be reclassified to profit or
loss under the equity method
other debt investments
arising from the reclassification of
financial assets
for other debt investments
translation of foreign currency-
denominated financial statements
VI Total comprehensive income 2,815,692,767.34 1,679,011,462.90
VII Earnings per share：
(I) Basic earnings per share
(RMB/share)
(II) Diluted earnings per share
(RMB/share)
Legal representative: Ruan Liping Chief Financial Officer: Zhang Lina
Head of the financial department: Luo Yuebo
Consolidated Cash Flow Statement
January-December 2021
Unit: RMB
Item Note 2021 2020
I Cash flows from operating activities:
Proceeds from sale of goods
and rendering of services
Net increase in customer
deposits and deposits from other
banks and financial institutions
Net increase in borrowings
from the central bank
Net increase in loans from other
financial institutions
Premiums received on original
insurance contracts
Net proceeds from reinsurance
Net increase in deposits and
investments of policy holders
Interest, fees and commissions
received
Net increase in loans from other
banks and financial institutions
Net increase in proceeds from
repurchase transactions
Annual Report 2021
Net proceeds from acting
trading of securities
Tax and levy rebates 25,804,052.16 17,284,864.61
Cash generated from other
operating activities
Subtotal of cash generated
from operating activities
Payments for goods and
services
Net increase in loans and
advances to customers
Net increase in deposits in the
central bank and other banks and
financial institutions
Payments for claims on original
insurance contracts
Net increase in loans to other
banks and financial institutions
Interest, fees and commissions
paid
Policy dividends paid
Cash paid to and for employees 1,741,129,477.86 1,555,279,980.16
Taxes and levies paid 1,161,567,823.93 819,545,329.90
Cash used in other operating
activities
Subtotal of cash used in
operating activities
Net cash generated
from/used in operating activities
II Cash flows from investing activities:
Proceeds from disinvestment 10,000,000.00
Return on investment 203,660,051.16 119,850,083.88
Net proceeds from the disposal
of fixed assets, intangible assets 22,285,265.83 2,287,593.12
and other long-term assets
Net proceeds from the disposal
of subsidiaries and other business
units
Cash generated from other
investing activities
Subtotal of cash generated
from investing activities
Payments for the acquisition
and construction of fixed assets,
intangible assets and other long-
term assets
Payments for investments
Net increase in pledged loans
granted
Net payments for the
acquisition of subsidiaries and
other business units
Cash used in other investing
activities
Subtotal of cash used in
investing activities
Annual Report 2021
Net cash generated
-1,588,987,931.15 -4,249,591,758.14
from/used in investing activities
III Cash flows from financing activities:
Capital contributions received 58,919,460.00 3,567,124,820.42
Of which: Capital contributions
by non-controlling interests to
subsidiaries
Borrowings received 1,229,444,657.64 956,694,305.55
Cash generated from other
financing activities
Subtotal of cash generated
from financing activities
Repayment of borrowings 733,145,768.73 300,000,000.00
Interest and dividends paid 1,235,638,745.39 2,286,031,250.00
Of which: Dividends paid by
subsidiaries to non-controlling
interests
Cash used in other financing
activities
Subtotal of cash used in
financing activities
Net cash generated
-700,808,446.71 1,925,600,149.55
from/used in financing activities
IV Effect of foreign exchange
rate changes on cash and cash -1,365,206.44 -2,982,481.80
equivalents
V Net increase in cash and cash
equivalents
Add: Cash and cash
equivalents, beginning of the 1,829,551,296.70 719,322,675.44
period
VI Cash and cash equivalents,
end of the period
Legal representative: Ruan Liping Chief Financial Officer: Zhang Lina
Head of the financial department: Luo Yuebo
Cash Flow Statement of the Company as the Parent
January-December 2021
Unit: RMB
Item Note 2021 2020
I Cash flows from operating activities:
Proceeds from sale of goods
and rendering of services
Tax and levy rebates
Cash generated from other
operating activities
Subtotal of cash generated
from operating activities
Payments for goods and
services
Cash paid to and for employees 622,109,797.27 570,574,072.87
Taxes and levies paid 262,378,388.50 260,167,559.31
Cash used in other operating 898,019,962.90 1,206,376,854.94
Annual Report 2021
activities
Subtotal of cash used in
operating activities
Net cash generated from/used in
operating activities
II Cash flows from investing activities:
Proceeds from disinvestment 10,000,000.00
Return on investment 1,095,128,801.14 1,254,671,774.57
Net proceeds from the disposal
of fixed assets, intangible assets 17,822,095.19 2,013,719.94
and other long-term assets
Net proceeds from the disposal
of subsidiaries and other business
units
Cash generated from other
investing activities
Subtotal of cash generated
from investing activities
Payments for the acquisition
and construction of fixed assets,
intangible assets and other long-
term assets
Payments for investments 11,000,000.00 1,000,000.00
Net payments for the
acquisition of subsidiaries and
other business units
Cash used in other investing
activities
Subtotal of cash used in
investing activities
Net cash generated
from/used in investing activities
III Cash flows from financing activities:
Capital contributions received 58,919,460.00 3,567,124,820.42
Borrowings received 633,145,768.73 660,000,000.00
Cash generated from other
financing activities
Subtotal of cash generated
from financing activities
Repayment of borrowings 633,145,768.73
Interest and dividends paid 1,225,366,634.27 2,286,031,250.00
Cash used in other financing
activities
Subtotal of cash used in
financing activities
Net cash generated
-1,177,779,477.65 1,928,905,844.00
from/used in financing activities
IV Effect of foreign exchange
rate changes on cash and cash
equivalents
V Net increase in cash and cash
equivalents
Add: Cash and cash
equivalents, beginning of the 894,111,904.74 208,260,137.97
period
VI Cash and cash equivalents, 1,729,210,241.72 894,111,904.74
Annual Report 2021
end of the period
Legal representative: Ruan Liping Chief Financial Officer: Zhang Lina
Head of the financial department: Luo Yuebo
Annual Report 2021
Consolidated Statements of Changes in Owners’ Equity
January-December 2021
Unit: RMB
Equity attributable to owners of the Company as the parent
Non-
Other equity control Total
Item Paid-in Other Speci Gene
instruments Less: ling owners’
capital (or Capital comprehe fic Surplus ral Retained Oth interest equity
Prefere Perpet Treasury Subtotal
share Oth reserves nsive reser reserves reser earnings ers s
nce ual shares
capital) ers income ve ve
shares bonds
I Balance as
at the end of 600,613,8 3,820,175,6 46,728,59 28,863,76 302,797,9 4,431,669,9 9,137,392,5
the prior 00.00 08.14 4.00 9.91 98.73 86.31 69.09
year
Add:
Adjustment
s for
changes in
accounting
policies
Adjustment
s for
correction
of previous
errors
Adjustment
s for
business
combinatio
ns involving
entities
under
common
control
Other
adjustments
II Balance 600,613,8 3,820,175,6 46,728,59 28,863,76 302,797,9 4,431,669,9 9,137,392,5
Annual Report 2021
as at the 00.00 08.14 4.00 9.91 98.73 86.31 69.09
beginning
of the year
III
Increase/de
crease in 566,720.0 93,892,680. 33,982,94 1,579,208,9 1,618,359,0
the period 0 42 6.00 32.66 07.54
(“-” for
decrease)
(I) Total -
comprehens 21,326,37
ive income 9.54
(II) Capital
increased 566,720.0 93,892,680. 33,982,94 60,476,454.
and reduced 0 42 6.00 42
by owners
y shares 566,720.0 50,544,523. 51,111,243.
increased 0 60 60
by owners
increased
by other
equity
holders
based
payments 43,348,156. 33,982,94 9,365,210.8
recognized 82 6.00 2
in owners’
equity
(III) Profit - -
distribution 1,201,151,8 1,201,151,8
iation to
surplus
reserves
iation to
Annual Report 2021
general
reserve
iation to - -
owners (or 1,201,151,8 1,201,151,8
shareholder 00.00 00.00
s)
(IV)
Transfers
within
owners’
equity
in capital
(or share
capital)
from capital
reserves
in capital
(or share
capital)
from
surplus
reserves
reserves
used to
offset loss
in defined
benefit
schemes
transferred
to retained
earnings
comprehens
ive income
transferred
Annual Report 2021
to retained
earnings
(V) Specific
reserve
in the
period
the period
(VI) Others
IV Balance
as at the end 601,180,5 3,914,068,2 80,711,54 7,537,390 302,797,9 6,010,878,9 10,755,751, 10,755,751,
of the 20.00 88.56 0.00 .37 98.73 18.97 576.63 576.63
period
Equity attributable to owners of the Company as the parent
Non-
control Total
Item Paid-in Other equity instruments Other Speci Gene
Less: ling owners’
capital (or Capital comprehe fic Surplus ral Retained Oth interest equity
Prefere Perpet Treasury Subtotal
share Oth reserves nsive reser reserves reser earnings ers s
nce ual shares
capital) ers income ve ve
shares bonds
I Balance as
at the end of 540,000,0 310,256,11 302,797,9 4,398,239,9 5,551,303,8
the prior 00.00 9.20 98.73 12.17 41.96
year
Add:
Adjustments
for changes
in
accounting
policies
Adjustments
for
correction
of previous
errors
Annual Report 2021
Adjustments
for business
combination
s involving
entities
under
common
control
Other
adjustments
II Balance
as at the 540,000,0 310,256,11 302,797,9 4,398,239,9 5,551,303,8
beginning 00.00 9.20 98.73 12.17 41.96
of the year
III
Increase/dec
rease in the 60,613,80 3,509,919,4 46,728,59 28,853,95 33,430,074. 3,586,088,7
period (“-” 0.00 88.94 4.00 8.05 14 27.13
for
decrease)
(I) Total
comprehens
ive income
(II) Capital
increased 60,613,80 3,509,919,4 46,728,59 3,523,804,6
and reduced 0.00 88.94 4.00 94.94
by owners
y shares 60,613,80 3,489,323,2 3,549,937,0
increased by 0.00 94.00 94.00
owners
increased by
other equity
holders
based
payments 20,596,194. 46,728,59
recognized 94 4.00
in owners’
equity
Annual Report 2021
(III) Profit - -
distribution 2,280,000,0 2,280,000,0
iation to
surplus
reserves
iation to
general
reserve
iation to - -
owners (or 2,280,000,0 2,280,000,0
shareholders 00.00 00.00
)
(IV)
Transfers
within
owners’
equity
in capital
(or share
capital)
from capital
reserves
in capital
(or share
capital)
from
surplus
reserves
reserves
used to
offset loss
Annual Report 2021
in defined
benefit
schemes
transferred
to retained
earnings
comprehens
ive income
transferred
to retained
earnings
(V) Specific
reserve
in the period
the period
(VI) Others
IV Balance
as at the end 600,613,8 3,820,175,6 46,728,59 28,863,76 302,797,9 4,431,669,9 9,137,392,5 9,137,392,5
of the 00.00 08.14 4.00 9.91 98.73 86.31 69.09 69.09
period
Legal representative: Ruan Liping Chief Financial Officer: Zhang Lina Head of the financial department: Luo Yuebo
Statements of Changes in Owners’ Equity of the Company as the Parent
January-December 2021
Unit: RMB
Paid-in Other equity instruments Other
Less: Total
Item capital (or Capital comprehen Specific Surplus Retained
Preference Perpetual Treasury owners’
share Others reserves sive reserve reserves earnings
shares bonds shares equity
capital) income
I Balance as at the end of the 600,613,80 3,815,676, 46,728,594 302,797,9 2,112,413, 6,784,773,
prior year 0.00 184.48 .00 98.73 955.75 344.96
Add: Adjustments for changes
Annual Report 2021
in accounting policies
Adjustments for
correction of previous errors
Other adjustments
II Balance as at the beginning 600,613,80 3,815,676, 46,728,594 302,797,9 2,112,413, 6,784,773,
of the year 0.00 184.48 .00 98.73 955.75 344.96
III Increase/ decrease in the 93,892,680 33,982,946 1,614,540, 1,675,017,
period (“-” for decrease) .42 .00 967.34 421.76
(I) Total comprehensive 2,815,692, 2,815,692,
income 767.34 767.34
(II) Capital increased and 70,456,679 33,982,946 37,040,453
reduced by owners .24 .00 .24
by owners .60 .60
equity holders
recognized in owners’ equity .64 .00
.36
- -
(III) Profit distribution 1,201,151, 1,201,151,
reserves
- -
(or shareholders)
(IV) Transfers within owners’
equity
share capital) from capital
reserves
share capital) from surplus
reserves
offset loss
Annual Report 2021
schemes transferred to
retained earnings
income transferred to retained
earnings
(V) Specific reserve
(VI) Others
.18 .18
IV Balance as at the end of the 601,180,52 3,909,568, 80,711,540 302,797,9 3,726,954, 8,459,790,
period 0.00 864.90 .00 98.73 923.09 766.72
Paid-in Other equity instruments Other
Less: Total
Item capital (or Capital comprehen Specific Surplus Retained
Preference Perpetual Treasury owners’
share Others reserves sive reserve reserves earnings
shares bonds shares equity
capital) income
I Balance as at the end of the 540,000,00 305,756,69 302,797,9 2,713,402, 3,861,957,
prior year 0.00 5.54 98.73 492.85 187.12
Add: Adjustments for
changes in accounting
policies
Adjustments for
correction of previous errors
Other adjustments
II Balance as at the beginning 540,000,00 305,756,69 302,797,9 2,713,402, 3,861,957,
of the year 0.00 5.54 98.73 492.85 187.12
III Increase/ decrease in the 60,613,800. 3,509,919, 46,728,594 2,922,816,
period (“-” for decrease) 00 488.94 .00 157.84
(I) Total comprehensive 1,679,011, 1,679,011,
income 462.90 462.90
(II) Capital increased and 60,613,800. 3,498,708, 46,728,594 3,512,593,
reduced by owners 00 038.69 .00 244.69
by owners 00 294.00 094.00
Annual Report 2021
equity holders
recognized in owners’ equity 69 .00
.31
- -
(III) Profit distribution 2,280,000, 2,280,000,
reserves
- -
(or shareholders) 000.00 000.00
(IV) Transfers within owners’
equity
share capital) from capital
reserves
share capital) from surplus
reserves
offset loss
benefit schemes transferred to
retained earnings
income transferred to retained
earnings
(V) Specific reserve
(VI) Others
.25 .25
IV Balance as at the end of 600,613,80 3,815,676, 46,728,594 302,797,9 2,112,413, 6,784,773,
the period 0.00 184.48 .00 98.73 955.75 344.96
Legal representative: Ruan Liping Chief Financial Officer: Zhang Lina Head of the financial department: Luo Yuebo
Annual Report 2021
III Company Profile
√ Applicable □ Not applicable
Gongniu Group Co., Ltd (hereinafter referred to as “the Company” or “Gongniu”) is a joint stock
limited company transformed from the former Gongniu Group Limited with 31 August 2017 as the base
date. It was registered with Ningbo Municipal Market Supervision Administration on 27 December 2017
and is headquartered in Ningbo City, Zhejiang Province. The Company now holds a business license
with a unified social credit code of 91330282671205242Y, with a registered capital of RMB601,180,500
and a total of 601,180,500 shares (each with a par value of RMB1). Among them, there are 525,579,500
restricted public A-shares and 75,601,000 unrestricted public A-shares. The Company’s shares were
listed for public trading on the Shanghai Stock Exchange on 6 February 2020.
The Company pertains to the electrical machinery and equipment manufacturing industry. It is
mainly engaged in the research, development, production and sales of power connection and power
extension products such as adaptors, wall switches and sockets, LED lighting and digital accessories.
Products mainly include adaptors, wall switches and sockets, LED lighting and digital accessories.
These financial statements have been authorized for issue by the Tenth Meeting of the Second
Board of Directors of the Company on 11 April 2022.
√ Applicable □ Not applicable
The Company included 16 subsidiaries, including Ningbo Gongniu Electrics Co., Ltd., Cixi
Gongniu Electrics Co., Ltd. and Shanghai Gongniu Electrics Co., Ltd. in the scope of consolidated
financial statements for the current period. For details, please refer to the notes of "VIII. Changes in
Consolidation Scope" and "IX. Interests in Other Entities" in "Section 10 Financial Report" of this
annual report.
IV Preparation Basis of Financial Statement
The financial statements of the Company are based on continuing operations.
√ Applicable □ Not applicable
The Company does not undergo any event or situation which may cause great concern about sustainable
operation ability within 12 months since the end of the reporting period.
V Significant Accounting Policies and Accounting Estimates
Specific accounting policies and accounting estimation hint:
□ Applicable √ Not applicable
The Company’s Financial Statements are prepared in accordance with Accounting Standards for
Business Enterprises, and indicate relevant information about the Company's financial status, business
results and cash flow truly and completely.
The fiscal year of the Company is from January 1 to December 31 of every calendar year.
Annual Report 2021
√ Applicable □ Not applicable
The operating cycle of the Company is short, and 12 months is taken as the liquidity criterion for assets
and liabilities.
The standard currency for accounting is RMB.
combination not under the same control
√ Applicable □ Not applicable
(1) Accounting methods of business combination under the same control
The Company’s assets and liabilities acquired from business combinations will be measured
according to the carrying value of the acquiree in financial statement of the final controlling party. The
Company will adjust capital reserves according to proportion of the acquiree’s carrying value in
consolidated financial statement of the final controlling party and the balance between carrying value
and the carrying value paid for combination consideration or total nominal value of issued shares; if the
capital reserve is insufficient to offset such difference, the difference will be offset against retained
earnings.
(2) Accounting methods of business combination not under the same control
On the acquisition date, the difference between the combined cost and the fair value share of the
identifiable net assets of the acquiree obtained in the merger is recognized as goodwill. If the combined
cost is less than the fair value share of the identifiable net assets of the acquiree obtained in the
combination, firstly, the fair value of identifiable assets, liabilities and contingent liabilities of the
acquiree and the measurement of combined cost are reviewed. If the combined cost is still less than the
fair value share of identifiable net assets of the acquiree obtained in the merger after review, the
difference is recorded in profit and loss of the current period.
√ Applicable □ Not applicable
(1) The Company as the parent brings all subsidiaries under its control into the consolidated scope
of the consolidated financial statements. The consolidated financial statements are based on the financial
statements of the Company as the parent and its subsidiaries and are prepared by the Company as the
parent according to other relevant information and Accounting Standards for Enterprises No. 33 -
Consolidated Financial Statements.
(2) Relevant accounting treatment methods for buying and re-selling or selling and re-buying the
equity of the same subsidiary in two consecutive fiscal years
□ Applicable √ Not applicable
Cash listed in cash flow statement refers to cash on hand and reserves always available for payment.
Cash equivalents refer to investments that are held for short term, highly liquid, and readily convertible
to known amounts of cash and subject to insignificant risk of change in value.
Annual Report 2021
√ Applicable □ Not applicable
(1) Conversion of foreign currency business
At the initial recognition of foreign currency transactions, foreign currency shall be converted into
RMB at the approximate exchange rate of the spot exchange rate on the transaction date. On the balance
sheet date, foreign currency monetary items are converted at the spot exchange rate on the balance sheet
date, and the exchange difference arising from different exchange rates is recorded in profit and loss of
the current period except the exchange difference between the principal and interest of foreign currency
special loans related to the purchase and construction of assets eligible for capitalization. Foreign
currency non-monetary items measured at historical cost are still converted at the spot exchange rate on
the transaction date, without changing their RMB amount. Foreign currency non-monetary items
measured at fair value shall be converted at the spot exchange rate on the date when the fair value is
determined, and the difference shall be recorded in the profit and loss of the current period or other
comprehensive income.
(2) Conversion of foreign currency financial statements
Assets and liabilities in the balance sheet shall be converted at the spot exchange rate on the
balance sheet date. Except for the “undistributed profit” item, other items of owner’s equity items are
converted at the spot exchange rate on the transaction date; the income and expense items in the income
statement are converted at the spot exchange rate on the transaction date. The differences arising from
the above conversion of foreign currency-denominated financial statements shall be recorded in other
comprehensive income.
√ Applicable □ Not applicable
(1) Classification of financial assets and financial liabilities
Financial assets are classified into the following three categories when they are initially recognized:
a) Financial assets measured at amortized cost; b) financial assets at fair value through other
comprehensive income; c) financial assets at fair value through current profit or loss.
Financial liabilities are classified into the following four categories when they are initially
recognized: a) Financial liabilities at fair value through current profit or loss; b) financial liabilities
arising from the transfer of financial assets not meeting the de-recognition criteria or from the continuing
involvement in the transferred assets; c) financial guarantee contracts which do not fall within the
category of (1) or (2) above, and loan commitments which do not fall within category (1) above and
made at an interest rate lower than the market rate; d) financial liabilities measured at amortized cost.
(2) Recognition basis, measurement methods and derecognition conditions for financial assets and
financial liabilities
a) Determination basis and measuring methods for financial assets and financial liabilities
A financial instrument is recognized as an asset or liability when the Company becomes a party
thereto. For financial assets or financial liabilities measured at fair value through profit or loss, the
Annual Report 2021
transaction expenses are directly included in profit and loss of the current period; for financial assets or
financial liabilities in other categories, the transaction expenses are included in the amount initially
recognized. However, accounts receivable initially recognized by the Company that do not include a
significant financing component or where the Company does not consider the financing component in a
contract with a term not exceeding one year will be initially measured at the transaction price defined in
Accounting Standard for Business Enterprises No.14-Income.
b) Subsequent measurement of financial assets
A. Financial assets measured at amortized cost
Financial assets are subsequently measured at amortized cost by the effective interest method.
Gains or losses arising from a financial asset measured at amortized cost which does not form part of
any hedging relationship are recorded in current profit or loss at the time of de-recognition,
reclassification, amortization according to the effective interest method or recognition of impairment.
B. Investments in debt instruments at fair value through other comprehensive income
Such financial assets shall be subsequently measured at fair value. Interest, impairment loss or gain
and exchange gain/loss calculated using the effective interest method are recorded in current profit or
loss, other gains or losses are recorded in other comprehensive income. On derecognition, cumulative
gains or losses that were previously recorded in other comprehensive income are transferred from other
comprehensive income and recorded in current profit or loss.
C. Investments in equity instruments at fair value through other comprehensive income
Such financial assets shall be subsequently measured at fair value. Dividend received (except for
the portion which forms part of investment cost recovered) is recorded in current profit or loss, other
gains or losses are recorded in other comprehensive income. On derecognition, cumulative gains or
losses that were previously recorded in other comprehensive income are transferred from other
comprehensive income and recorded in retained earnings.
D. Financial assets at fair value through profit or loss
Gains or losses (including interest income and dividend income) arising from the subsequent
measurement at fair value are recorded in current profit or loss, unless the financial asset forms part of a
hedging relationship.
c) Method for the subsequent measurement of financial liabilities
A. Financial liabilities measured at fair value through profit and loss of the current period
Such financial liabilities include transactional financial liabilities (including derivative instruments
which belong to the category of financial liabilities) and financial liabilities designated as at fair value
through current profit or loss. Such financial liabilities are subsequently measured at fair value. The
amount of changes in the fair value of financial liabilities designated as at fair value through profit or
loss, which arise from the change in the credit risk of the Company, is recorded in other comprehensive
income, unless such accounting treatment would result in or increase the accounting mismatch of gain
and loss. Other gains or losses (including interest expense, except for the fair value changes arising from
the change in credit risk of the Company) on such financial liabilities are recorded in current profit or
Annual Report 2021
loss, unless such financial liabilities form part of a hedging relationship. On derecognition, cumulative
gains or losses that were previously recorded in other comprehensive income are transferred from other
comprehensive income and recorded in retained earnings.
B. Financial liabilities resulting from the transfer of financial assets which does not satisfy the de-
recognition criteria or from the continuing involvement in the transferred assets are measured according
to the relevant provisions of the Accounting Standard for Business Enterprises No.23-Transfer of
Financial Assets.
C. Financial guarantee contracts that do not fall within the category of A or B above, and loan
commitments that do not fall within the category of A above and made at an interest rate lower than the
market rate, are subsequently measured at the higher of the two following amounts after initial
recognition: a. The amount of loss provision determined according to the rules related to the impairment
of financial instruments; b. The remaining balance of the initially recognized amount after deducting the
amount of cumulative amortization determined according to relevant rules of the Accounting Standard
for Business Enterprises No.14-Income.
D. Financial liabilities measured at amortized cost
Such financial liabilities are measured at amortized cost using the effective interest method. Gains
or losses arising from a financial liability measured at amortized cost which does not form part of any
hedging relationship are recorded in current profit or loss at the time of de-recognition or amortization
according to the effective interest method.
d) Derecognition of financial assets and financial liabilities
Financial assets are derecognized when any of the following criteria is met:
a. The contractual rights to receive the cash flows from the financial assets terminate; or
b. The financial asset has been transferred, and such transfer satisfies the criteria set out in the
Accounting Standard for Business Enterprises No.23-Transfer of Financial Assets regarding the de-
recognition of financial assets.
B. Where the present obligation of a financial liability (or a portion thereof) has been discharged,
the Company de-recognizes the financial liability (or a portion thereof).
(3) Recognition basis and measurement method of financial asset transfer
If the Company has transferred substantially all risks and rewards of ownership of the financial
asset, the financial asset is de-recognized, and the right and obligation arising from or retained in the
transfer are individually recognized as an asset or liability. If substantially all risks and rewards of
ownership of the financial asset are retained, the financial asset transferred remains recognized. If the
Company has not transferred or retained nearly all the risks and remunerations of ownership of the credit
assets, different measures should be taken in accordance with the following circumstances respectively:
If the Company gives up the control of the financial assets, these financial assets shall be derecognized;
if the Company does not give up the control of the financial assets, the relevant financial assets shall be
recognized and the relevant liabilities shall be recognized accordingly in accordance with the extent of
their continued involvement in the transferred financial assets.
Annual Report 2021
If the overall transfer of financial assets meets the conditions for derecognition, the difference
between the following two amounts shall be recorded in profit and loss of the current period: A. The
carrying value of the transferred financial asset as of the date of derecognition; B. Sum of the
consideration received for the transfer of the financial asset, and the portion of the cumulative amount of
fair value changes previously recorded in other comprehensive income that corresponds with the portion
of the asset de-recognized (the transferred financial asset is an investment in debt instruments at fair
value through other comprehensive income). Where a portion of the financial asset has been transferred
and the transferred portion as a whole satisfies the derecognition criteria, the carrying value of the
financial asset as a whole prior to its transfer is allocated between the portion of the asset derecognized
and the portion that remains recognized, according to their relative fair value as of the transfer date, and
the difference between the two amounts mentioned below is recorded in current profit or loss: (1) The
carrying value of the derecognized portion; (2) Sum of the consideration received for the derecognition
portion, and the portion of the cumulative amount of fair value changes previously recorded in other
comprehensive income, which corresponds with the derecognized portion (the transferred financial asset
is an investment in debt instruments at fair value through other comprehensive income).
(4) Methods for determining the fair value of financial assets and financial liabilities
The Company applies valuation techniques that are applicable in the current situation and are
supported by sufficient available data and other information to determine the fair value of relevant
financial assets and financial liabilities. The Company classifies the inputs of valuation techniques into
the following levels and applies them accordingly:
a) Level 1 inputs are the unadjusted quotation of the same assets or liabilities available on the active
market on the measurement day;
b) Level 2 inputs are inputs for the relevant assets or liabilities other than the level 1 inputs, which
are directly or indirectly observable, including quotations for similar assets or liabilities in an active
market; quotations for the same or similar assets or liabilities in an inactive market; other observable
inputs other than quotations, such as interest rate and yield curve observable during normal quotation
intervals; and market-tested inputs;
c) Level 3 inputs are non-observable inputs for the relevant assets or liabilities, including interest
rate and stock volatility which cannot be directly observed or cannot be verified by observable market
data, the future cash flow of a retirement obligation assumed in a business combination, and financial
forecast performed based on internal data.
(5) Impairment of financial instruments
a) Measurement and accounting treatment of impairment of financial instruments
Based on the expected credit loss, for financial assets measured in amortized cost, investment in
debt instruments measured at fair value and whose changes are recorded in other comprehensive income,
contract assets, lease receivables, loan commitments classified as financial liabilities measured at fair
value and whose changes are recorded in profit and loss of the current period, financial guarantee
contracts that do not belong to financial liabilities measured at fair value and whose changes are
Annual Report 2021
recorded in the profits and losses of the current period or financial liabilities formed by the transfer of
financial assets that do not meet the conditions for derecognition or continue to be involved in the
transferred financial assets shall be impaired and loss reserves shall be recognized.
Expected credit loss refers to the weighted average of credit loss of financial instruments weighted
with default risks. Credit loss refers to the difference between all contractual cash flow receivable by the
Company under contracts which are discounted according to the original effective interest rate, and all
the cash flow expected to be received, namely the present value of all cash shortfall. Specifically,
financial assets acquired or derived to which credit impairment has occurred are discounted by the
Company according to the credit-adjusted effective interest rate.
For the acquired or derived financial assets with credit impairment, the Company only recognizes
the cumulative change of expected credit loss over the lifetime after initial recognition as the loss reserve
on the balance sheet date.
For receivables and contract assets formed by transactions regulated by Accounting Standards for
Business Enterprises No.14-Income, which do not contain significant financing components or the
Company does not consider the financing components in contracts not exceeding one year, the Company
uses simplified measurement methods to measure the loss reserve according to the expected credit loss
amount over the lifetime.
For financial assets other than the above measurement methods, at each balance sheet date, the
Company assesses the financial assets to see if the credit risk has significantly increased after initial
recognition. If the credit risk has significantly increased after initial recognition, the Company calculates
provision for loss according to the amount of expected credit loss over the lifetime of the assets; if credit
risk has not significantly increased after initial recognition, the Company calculates loss provision based
on expected credit loss in the future 12 months.
The Company uses available reasonable and well-founded information, including forward-looking
information, to determine whether the credit risk of financial instruments has increased significantly
since the initial recognition by comparing the default risk of financial instruments on the balance sheet
date with the default risk on the initial recognition date.
On the balance sheet date, if the Company judges that the financial instrument only has low credit
risk, it is assumed that the credit risk of the financial instrument has not increased significantly since the
initial recognition.
The Company assesses the expected credit risk and measures the expected credit loss on the basis
of single financial instrument or portfolios of financial instruments. When based on the portfolio of
financial instruments, the Company classifies the financial instruments into different portfolios
according to the common risk characteristics.
The Company re-measures expected credit loss at each balance sheet date, and the amount of
increase in loss provision or the written-back amount of loss provision arising from re-measurement is
recorded in current profit or loss as an impairment loss or gain. For financial assets measured at
amortized cost, impairment losses were allocated to offset the carrying value of the financial asset
Annual Report 2021
presented in the balance sheet. For the debt investments measured at fair value through other
comprehensive income, the Company recognized its loss reserves in other comprehensive income but
did not offset the carrying value of the financial asset.
b) Financial instruments for assessing expected credit risk and measuring expected credit loss by
portfolio
Item Basis for portfolio Measurement of expected credit loss
recognition
With reference to historical credit loss
experience, combined with the current
situation and the forecast of future
Other receivables-aging Aging portfolio economic conditions, the expected credit
portfolio
loss is calculated through default risk
exposure and the expected credit loss rate
in the next 12 months or over the lifetime.
c) Receivables and contract assets with expected credit losses measured by portfolio
A. Specific combination and method of measuring expected credit loss
Item Basis for portfolio Measurement of expected credit loss
recognition
With reference to historical credit loss
experience, combined with the current
situation and the forecast of future
Notes receivable--trade Type of notes economic conditions, the expected credit
acceptance portfolio loss is calculated through default risk
exposure and the expected credit loss rate
or over the lifetime. Commercial
acceptance bills receivable
With reference to historical credit loss
experience, combined with the current
situation and the forecast of future
Notes receivable--bank Type of notes economic conditions, the expected credit
acceptance portfolio loss is calculated through default risk
exposure and the expected credit loss rate
or over the lifetime. Commercial
acceptance bills receivable
With reference to historical credit loss
experience, combined with the current
situation and the forecast of future
Accounts receivable--aging economic conditions, the comparison
Aging portfolio
portfolio table between the aging of accounts
receivable and the expected credit loss
rate over the lifetime is prepared to
calculate the expected credit loss.
B. Accounts receivable--comparison of aging portfolio with expected credit loss rate over the
lifetime
Accounts receivable
Aging Expected credit losses
(%)
Within 1 year (inclusive, the same below) 5.00
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Accounts receivable
Aging Expected credit losses
(%)
Over 3 years 100.00
(6) Offsetting financial assets and financial liabilities
The financial assets and financial liabilities are respectively listed in the balance sheet, not
offsetting each other. However, when all the following criteria are met, financial assets and liabilities are
shown on a net basis after offsetting: A. The Company has the statutory right to offset the recognized
amounts, and such right is currently enforceable; B. The Company intends to settle the financial assets
and liabilities on a net basis, or to realize the assets and settle the liabilities simultaneously.
For the transfer of financial assets where the derecognition criteria are not met, the Company may not
offset the financial assets transferred against the related liabilities.
Determination methods and accounting methods of the expected credit losses of notes receivable
□ Applicable √ Not applicable
Determination methods and accounting methods of the expected credit losses of accounts
receivable
□ Applicable √ Not applicable
□ Applicable √ Not applicable
Determination methods and accounting methods of the expected credit losses of other receivables
□ Applicable √ Not applicable
√ Applicable □ Not applicable
Inventories refer to finished goods or commodities for sale held in daily activities, unfinished goods
in manufacturing process, and materials and supplies consumed in process of manufacturing products or
providing services, etc.
The cost measurement for the inventories delivered is made with a one-time weighted average
method at the end of the month.
On the balance sheet date, inventories should be measured whichever is lower in accordance with
the cost and net reliable value, and the provision for decline in value of inventories shall be made
according to the difference that the cost of each item of inventories higher than the net realizable value.
For inventories directly used for sale, the net realizable value shall be determined by the estimated
Annual Report 2021
selling price of the inventory minus the estimated selling expenses and relevant taxes and fees in the
normal production and operation process. For materials inventory requiring processing during normal
process of production and operation, the net realizable value shall be determined by deducting estimated
costs occurring during completion, estimated selling expenses and related taxes from estimated sale
price of finished products. On the balance sheet date, some of the same inventory have contract price
agreed, others not; their net realizable value shall be recognized respectively and compared with the
corresponding cost to determine the amount of provision or write-back of inventory depreciation reserve.
The perpetual inventory system is adopted for the inventories of the Company.
(1) Low-value consumables
Low-value consumables are amortized with a one-time write-off method.
(2) Packing materials
Packing materials are amortized with a one-time write-off method.
(1). Method and criteria for determining contract assets
√ Applicable □ Not applicable
The Company presented contract assets or contract liabilities on the balance sheet in accordance
with the relationship between performance obligations and customer payment. The Company will set off
the contract assets and contract liabilities under the same contract and present them in net amount.
The right of the Company to receive consideration from its customers unconditionally (i.e. only
depending on the passage of time) is presented as receivables, and the right to receive consideration for
goods transferred to its customers (depending on factors other than the passage of time) is presented as
contract assets.
(2). Determination methods and accounting methods of the expected credit losses of contract assets
□ Applicable √ Not applicable
□ Applicable √ Not applicable
(1). Determination methods and accounting methods of the expected credit losses of debt
investments
□ Applicable √ Not applicable
(1). Determination methods and accounting methods of the expected credit losses of other debt
investments
□ Applicable √ Not applicable
(1). Determination methods and accounting methods of the expected credit losses of long-term
receivables
□ Applicable √ Not applicable
Annual Report 2021
√ Applicable □ Not applicable
Joint control refers to the control the Company shares with other entities over a certain arrangement
following relevant agreements by which any activity under the arrangement may be conducted only with
the unanimous agreement of all participants sharing the power of control. Significant influence refers to
the power to participate in making decisions on the financial and operating policies of an investee, but
not to control or do joint control together with other parties over the formulation of these policies.
(1) In case of a business combination under the same control, if the acquirer pays cash, transfers
non-cash assets, assumes debts or issues equity securities as merger consideration, the share of the
owner’s equity of the acquiree obtained on combination date in the carrying value of the financial
statements of the ultimate controlling party is deemed as an initial investment cost. Capital reserve is
adjusted based on the difference between initial investment cost of long-term equity investment and
carrying value of paid combination consideration or total nominal value of issued share; if the capital
reserve is insufficient to offset such difference, the difference will be offset against retained earnings.
If business combination under the same control is realized step by step through multiple
transactions, whether the multiple transactions is a “Package Deal” is determined. If the deals fell into a
"Package Deal", all transactions shall be treated as a transaction to gain control. If it is not a “package
deal”, on the combination date, the initial investment cost of the long-term equity investment shall be
determined based on the share of net assets’ carrying value of the acquiree in the consolidated financial
statements of the ultimate controlling party. The capital reserve is adjusted based on the difference
between the initial investment cost of the long-term equity investment on the combination date and the
sum of the carrying value of the long-term equity investment before the acquisition and the carrying
value of the new payment consideration on the acquisition date. If the capital reserve is insufficient to
offset such difference, the difference will be offset against retained earnings.
(2) For business combinations not under the same control, the fair value of the combination
consideration paid by it on the acquisition date shall be its initial investment cost.
For long-term equity investment formed by a business combination achieved step by step through
multiple transactions, relevant accounting treatment is performed with distinctions made between
separate financial statements and consolidated financial statements:
investment and the additional investment cost shall be taken as the initial investment cost when
converting to using the cost method.
deals fell into a "Package Deal", all transactions shall be treated as a transaction to gain control. If it is
not a “Package Deal”, the equity of the acquiree held prior to the acquisition date shall be re-measured
according to the fair value of the equity at the acquisition date, and the difference between the fair value
Annual Report 2021
and the carrying value shall be recorded in the current investment income. Where the equity of the
acquiree held prior to the acquisition date involves other comprehensive income accounted for based on
the equity method, etc., the other comprehensive income related to it shall be converted into the current
investment income of the acquisition date. However, other comprehensive income arising from the re-
measurement of net liabilities or changes in net assets of defined benefit plans by the investee is
excluded.
(3) Except for business combination: If it is acquired by paying cash, the actual acquisition price
shall be taken as its initial investment cost; if it is acquired by issuing equity securities, the fair value of
the issued equity securities shall be taken as its initial investment cost; if it is acquired by means of debt
restructuring, the initial investment cost shall be determined according to the Accounting Standards for
Business Enterprises No. 12-Debt Restructuring; if it is acquired by exchange of non-monetary assets,
the initial investment cost shall be determined according to the Accounting Standards for Business
Enterprises No. 7-Exchange of Non-monetary Assets.
The long-term equity investment controlled by the investee shall be accounted for by the cost
method; the long-term equity investment of associated enterprises and joint ventures shall be accounted
for by the equity method.
multiple transactions
(1) Separate financial statements
For the disposal of long-term equity investments, the difference between the carrying value and the
actual price acquired shall be recorded into profit and loss of the current period. For the remaining equity,
if it still has a significant impact on the investee or implements joint control with other parties, it shall be
accounted for by the equity method; if it is no longer possible to exercise control, joint control or
significant influence on the investee, accounting shall be carried out in accordance with the relevant
provisions of Accounting Standards for Business Enterprises No. 22-Recognition and Measurement of
Financial Instruments.
(2) Consolidated financial statements
until loss of control right. If it is not a "package deal", before the loss of control right, the difference
between the disposal price and the share of net assets is continuously calculated by the subsidiary from
the acquisition date or combination date corresponding to the disposal of long-term equity investment
shall be adjusted, and the capital reserve (capital premium) shall be adjusted. If the capital premium is
insufficient to offset, the retained earnings shall be offset.
In case of loss of control over the original subsidiary, the remaining equity shall be re-measured
according to its fair value on the date of loss of control. The aggregate of the consideration obtained by
disposing of the equity and the fair value of the remaining equity less the portion of the net assets of the
subsidiary that has been measured, as calculated at the original shareholding proportion, from the
Annual Report 2021
acquisition date or combination date is recognized in profit and loss of the current period on investments
in which the control is lost, and goodwill shall be offset. Other comprehensive income, etc. related to the
original subsidiary’s equity investment will be converted into income from investment for the current
period when the control is lost.
until loss of control right. If it is a “package deal”, the Company treats each transaction as a transaction
that disposes of a subsidiary and loses control. However, the difference between each disposal price
before losing control and the share of subsidiaries’ net assets corresponding to the disposed investment
shall be recognized as other comprehensive income in the consolidated financial statements, and shall be
transferred into the profits and losses of the current period in case of loss of control.
Not applicable
(1). recognition criteria
√ Applicable □ Not applicable
The fixed assets of the Company refer to tangible assets held for production of goods, provision of
labor services, lease or business with a service life of over a fiscal year. Fixed assets shall be recognized
when the economic benefits are flowing in and the cost can be measured reliably.
(2). Depreciation method
√ Applicable □ Not applicable
Depreciation Depreciable life Residual value Annual
Category
method (year) rate depreciation rate
Houses and Straight-line 20 3 4.85
buildings depreciation
method
Machinery Straight-line 4-10 3 9.70-24.25
equipment depreciation
method
Means of Straight-line 2-10 3 9.70-48.50
transportation depreciation
method
Electronic and Straight-line 2-10 3 9.70-48.50
other equipment depreciation
method
Fixed assets Straight-line 5 0 20
fixtures depreciation
method
(3). Recognition basis, valuation and depreciation method for fixed assets under financing lease
□ Applicable √ Not applicable
√ Applicable □ Not applicable
measured reliably. The construction in progress is measured according to the actual cost incurred before
the construction of the asset reaches its intended serviceable condition.
Annual Report 2021
into fixed assets based on its actual cost. For those that have reached their intended serviceable status but
have not yet completed the settlement, they shall be transferred to fixed assets according to the estimated
value, and the original provisional value shall be adjusted according to the actual cost after the final
accounts are completed, but the depreciation already accrued shall not be adjusted.
√ Applicable □ Not applicable
The borrowing costs that have occurred and can be directly attributed to the acquisition,
construction or production of assets eligible for capitalization are capitalized by the Company and
recorded in relevant cost of assets; other borrowing costs are recognized as expenses based on the
amount incurred when they occur, and shall be recorded in profit and loss of current period.
(1) When all the following conditions are met by the borrowing costs, capitalization will start: 1)
asset expenditure has occurred; 2) borrowing costs have occurred; 3) acquisition, construction or
production activities have started in order to make the fixed asset be ready for the intended use or sale.
(2) If the acquisition, construction or production of an asset eligible for capitalization is
continuously suspended for over 3 months for abnormal reasons, capitalization of the borrowing costs
shall be suspended; borrowing costs incurred during the suspension shall be recognized as the current
expenses until the acquisition, construction or production of the asset is resumed.
(3) When the assets with the purchase, construction or production meeting the capitalization
conditions reach the expected available or marketable state, the borrowing cost ceases to be capitalized.
For a specifically borrowed fund for the acquisition, construction or production of an asset eligible for
capitalization, the amount of interest that shall be capitalized is determined based on the interest
expenses incurred in the period when a specifically borrowed fund is obtained (including the
amortization of discounts or premiums recognized according to the effective interest method) less any
income earned on the unused borrowing fund as a deposit in a bank or as a temporary investment. Where
a general borrowing is used for the acquisition, construction and production of an asset eligible for
capitalization, the amount of interest that shall be capitalized is determined by multiplying the part of the
accumulative asset disbursements in excess of the weighted average asset disbursement for the
specifically borrowed fund by the capitalization rate of the general borrowing used.
□ Applicable √ Not applicable
□ Applicable √ Not applicable
□ Applicable √ Not applicable
Annual Report 2021
(1). Pricing method, service life, and impairment test
√ Applicable □ Not applicable
initially measured at costs.
the expected method to realize economic benefits relating to the intangible assets. Where the expected
realization method cannot be reliably determined, Straight-line Amortization Method is adopted. The
detailed period is as follows:
Amortization period
Item
(year)
Land use right Duration of land use
Software 2-5
(2). Accounting policies for internal research and development costs
√ Applicable □ Not applicable
The expenditures occurring during the research period of internal R&D items are included in the
profit or loss for the current period at the time of occurrence. Expenditure on internal research and
development projects in the research stage shall be recognized as intangible assets when the following
conditions are met at the same time: (1) It is technically feasible to complete the intangible assets so that
they can be used or sold; (2) it has the intention of completing the intangible asset and using or selling it;
(3) the ways in which intangible assets generate economic benefits include the existence of a market for
the products produced by using such intangible assets or the existence of a market for the intangible
assets themselves, and intangible assets that will be used internally shall be proven their usefulness; (4)
there should be sufficient technical, financial and other resources to complete the development of the
intangible asset and have the ability to use or sell the intangible assets; (5) the expenditure attributed to
the development stage of intangible assets can be measured reliably.
√ Applicable □ Not applicable
For long-term equity investments, fixed assets, construction in progress, right-of-use assets, long-
term assets with limited service life and other long-term assets, if there are signs of impairment on the
balance sheet date, the recoverable amount shall be estimated. Goodwill and intangible assets with
uncertain service life formed by business combinations are tested for impairment every year regardless
of whether there are signs of impairment.
If the recoverable amount of the above-mentioned long-term assets is lower than its carrying value,
the asset impairment reserve shall be recognized according to the difference and recorded in profit and
loss of the current period.
√ Applicable □ Not applicable
Annual Report 2021
Long-term prepaid expenses are accounted for all expenses that have been paid and have an
amortization period of more than one year (excluding one year). The long-term prepaid expenses are
accounted for according to the actual amount incurred and are amortized averagely over the benefit
period or the specified period. If the long-term deferred expenses item cannot bring benefit in the
subsequent accounting period, the amortized value of the item that has not been amortized will be
transferred to the profit or loss for the current period.
(1). Method for determining contract liabilities
√ Applicable □ Not applicable
The Company presented contract assets or contract liabilities on the balance sheet in accordance
with the relationship of performance obligations and customer payment. The Company will set off the
contract assets and contract liabilities under the same contract and present them in net amount.
The obligations of transferring goods to customers as a result of the consideration that the Company
had received or shall receive from customers were presented as contract liabilities.
(1). Accounting treatment methods of short-term remuneration
√ Applicable □ Not applicable
Within the accounting period when employees provide service, the actual short-term remuneration
shall be recognized as liabilities and be recorded in profit and loss of the current period or relevant asset
costs.
(2). Accounting treatment method for post-employment benefits
√ Applicable □ Not applicable
The Company classifies post-employment benefit plans into the defined contribution plan and the
defined benefit plan.
(1) During the accounting period in which the employees provide services to the Company, the
amount to be contributed as calculated according to the defined contribution plan is recognized as a
liability and recorded in the profit or loss for the current period or the related asset costs.
(2) The accounting handling of the defined benefit plan usually includes the following steps:
are estimated by using unbiased and mutually compatible actuarial assumptions, the obligations under
the defined benefit plan are measured, and the periods to which relevant obligations are attributed are
determined. Meanwhile, the Company will discount the obligations incurred from a defined benefit plan,
to determine present value of defined benefit plan and current service cost.
the fair value of assets of the defined benefit plans is recognized as one net liabilities or net profits of the
defined benefit plans. If the defined benefit plans have a surplus, the Company shall measure the net
profit of the defined benefit plans according to whichever is lower between the surplus and upper limit
on the assets of the defined benefit plans.
Annual Report 2021
recognized as service cost, net interest arising from the net liabilities and net assets of the defined benefit
plan, and changes in the net liabilities or net assets of the remeasured defined benefit plan. Of which, the
net interest arising from the net liabilities or net assets of the defined benefit plan is recorded in profit
and loss of the current period or related asset cost, and changes in the net liabilities or net assets of the
remeasured defined benefit plan are recorded in other comprehensive income, and is not written-back to
profits and losses in subsequent accounting periods. But these amounts recognized in other
comprehensive income can be transferred within the scope of equity.
(3). Accounting treatment method for dismissal benefits
√ Applicable □ Not applicable
If the Company provides the employee with dismissal benefits, the Company shall recognize the
employee remuneration liabilities and record them in profit or loss for the current period on the
following dates (whichever is earlier): (1) the date when the Company may not unilaterally withdraw
dismissal benefits provided due to termination of labor relationship plans or layoff proposals; (2) the
date when the Company recognizes costs or expenses relating to the restructure of payments of dismissal
benefits.
(4). Accounting treatment method for other long-term employee benefits
√ Applicable □ Not applicable
If other long-term benefits provided by the Company to employees meet the conditions of the
defined contribution plan, accounting treatment shall be carried out according to the relevant provisions
of defined contribution plan. Except for that, the other long-term benefits shall be subject to the
accounting handling according to the defined benefit plan. To simplify the related accounting treatment,
employee compensation cost incurred in the defined benefit plan is recognized as service costs. Net
interests of net liabilities or net assets of other long-term employee benefits, as well as the total net
amount of changes caused by re-measurement of net liabilities or net assets of other long-term employee
benefits, will be recorded in profit and loss of the current period or the related asset costs.
□ Applicable √ Not applicable
□ Applicable √ Not applicable
√ Applicable □ Not applicable
The Company's share-based payment includes equity-settled share-based payment and cash-settled
share-based payment.
based payment plans
(1) Equity-settled share-based payment
Annual Report 2021
For an equity-settled share-based payment in return for services of employees, if the right can be
exercised immediately after the grant, the fair value of the equity instruments shall, on the grant date, be
recorded in the relevant costs or expenses and the capital reserve shall be adjusted accordingly. For an
equity-settled share-based payment in return for employee services, if the right cannot be exercised only
after completing the service during the vesting period or meeting the prescribed performance conditions,
then on each balance sheet date within the vesting period, the services acquired in the current period
shall, based on the best estimate of the number of vested equity instruments, be recorded in the relevant
costs or expenses at the fair value of the equities instruments on the grant date, and the capital reserve
shall be increased accordingly.
For an equity-settled share-based payment in return for the service of any other party, if the fair
value of the service of any other party can be reliably measured, it shall be measured at the fair value of
the service of any other party on the acquisition date; if the fair value of the service of any other party
can not be reliably measured, but the fair value of the equity instruments can be reliably measured, it
shall be measured at the fair value of the equity instruments on the acquisition date and recorded in the
relevant costs or expenses, and the owner's equity shall be increased correspondingly.
(2) Cash-settled share payment
For a cash-settled share-based payment in return for services of employees, if the right can be
exercised immediately after the grant, the fair value of liabilities assumed by the Company shall, on the
grant date, be recorded in the relevant costs or expenses and the liabilities shall be increased accordingly.
For a cash-settled share-based payment, if the right cannot be exercised only after completing the service
during the vesting period or meeting the prescribed performance conditions, on each balance sheet date
within the vesting period, the services acquired in the current period shall, based on the best estimate of
the information about the vesting right, be recorded in the relevant costs or expenses and the
corresponding liabilities at the fair value of the liabilities assumed by the Company.
(3) Modification and termination of share-based payment plans
If the modification increases the fair value of the granted equity instruments, the Company shall
recognize the increase of the services acquired according to the increase of the fair value of the equity
instruments. If the modification increases the number of the granted equity instruments, the Company
shall recognize the increased fair value of equity instruments as the increase of the services acquired. If
the Company modifies the vesting conditions in a way that is favorable to employees, the Company shall
consider the modified vesting conditions when processing vesting conditions.
If the modification reduces the fair value of the granted equity instruments, the Company shall
continue to recognize the amount of the service acquired based on the fair value of the equity
instruments on the grant date, and shall not consider the decrease of the fair value of the equity
instruments. If the modification reduces the number of equity instruments, the Company shall process
equity instruments by reducing some of them as the cancellation of the granted equity instruments. If the
vesting conditions are modified in a way that is unfavorable to employees, the Company shall not
consider the modified vesting conditions when processing vesting conditions.
Annual Report 2021
If the Company cancels the granted equity instruments or settles the granted equity instruments (not
including those canceled due to failure to meet vesting conditions) during the vesting period, the
cancellation or settlement shall be processed as the vested right and the amount to be recognized within
the remaining vesting period originally shall be recognized immediately.
□ Applicable √ Not applicable
(1). Accounting policy for recognition and measurement of revenue
√ Applicable □ Not applicable
On the commencement date of a contract, the Company shall assess the contract, identify each
single performance obligation in the contract, and determine that each single performance obligation is
satisfied whether within a certain period of time or at a certain point in time.
When one of the following conditions is met, it belongs to fulfilling the performance obligation
within a certain period of time, otherwise, it belongs to fulfilling the performance obligation at a certain
point in time: (1) The customer obtains and consumes the economic benefits brought by the Company's
performance while the Company performs the obligation; (2) The customer can control the goods under
construction during the performance of the Company; (3) The goods produced during the performance
of the Company have irreplaceable uses, and the Company has the right to collect amount for the
cumulative performance completed so far during the whole contract period.
For the performance obligations performed within a certain period of time, the Company recognizes
the revenue according to the performance progress within that period of time. When the performance
progress cannot be reasonably determined, if the cost incurred is expected to be compensated, the
revenue shall be recognized according to the amount of the cost incurred until the performance progress
can be reasonably determined. For performance obligations performed at a certain point in time, revenue
is recognized at the time when the customer obtains control over related goods or services. To decide
whether the customer has obtained the control over goods, the Company takes into account the following
signs: (1) the enterprise has the present right to collection for the goods, meaning the customer bears the
present obligation to payment for the goods; (2) the enterprise has passed the legal title to the goods to
the customer, meaning the customer has had the legal title to the goods; (3) the enterprise has transferred
the physical possession of the goods to the customer, meaning the customer has had the physical
possession of the goods; (4) the enterprise has transferred the major risks and remunerations concerning
the title to the goods to the customer, meaning the customer has obtained the major risks and
remunerations concerning the title to the goods; (5) the customer has accepted the goods; (6) other signs
to show that the customer has obtained the control over the goods.
(1) The Company measures revenue on the basis of the transaction price allocated to each
performance obligation. Transaction price is the amount of consideration that the Company is expected
Annual Report 2021
to be entitled to receive for transferring goods or services to customers, excluding the amount received
on behalf of third parties and the amount expected to be refunded to customers.
(2) If there is variable consideration in a contract, the Company shall determine the best estimate of
the variable consideration according to the expected value or the most likely amount, but the transaction
price including the variable consideration shall not exceed the amount that the cumulative recognized
income will most likely not be significantly written-back when the relevant uncertainty is eliminated.
(3) If there is a significant financing component in a contract, the Company shall determine the
transaction price according to the amount payable in cash when the customer assumes control of the
goods or services. The difference between the transaction price and the contract consideration shall be
amortized by the effective interest rate method during the contract period. On the commencement date of
a contract, if the Company expects that the interval between the customer obtaining the control right of
goods or services and the customer paying the price will not exceed one year, the major financing
components in the contract will not be considered.
(4) If a contract contains two or more performance obligations, the Company shall allocate the
transaction price to each single performance obligation according to the relative proportion of the single
selling price of the goods promised by each single performance obligation on the commencement date of
the contract.
The Company mainly sells adaptors, wall switches and sockets, LED lighting and digital
accessories. In addition to meeting the general principles of revenue recognition, the sales of products
under different sales situations are generally recognized after meeting the following conditions.
(1) The specific time points for revenue recognition of various domestic sales methods of the
Company are as follows:
the distributor receives the goods.
goods and publishes the information on the quantity and amount of goods received on its supplier
platform, the Company recognizes the revenue when it completes the reconciliation. For sales by
opening an online shop on the e-commerce platform, the Company recognizes the revenue when the
customer receives the goods and confirms such receipt on the e-commerce platform. For the sales by real
estate developers or decoration companies, the Company recognizes the revenue when the buyer has
received the goods and both parties complete the reconciliation. For offline direct sales such as Shanghai
area, the Company recognizes the revenue when the goods are delivered to the buyer.
(2) The Company recognizes its revenue when it has completed the customs declaration formalities
and obtained the bill of lading.
(2). Different business models are adopted for different businesses, which may lead to the
differences in the accounting policy for recognition of revenue
□ Applicable √ Not applicable
Annual Report 2021
□ Applicable √ Not applicable
√ Applicable □ Not applicable
able to satisfy all the conditions attached to such government grant; (2) The Company is able to receive
the grants from the government. Government grants were measured at the amount received or receivable
if they were monetary assets. Non-monetary government grants were measured at fair value; if the fair
value could not be reliably obtained, they were measured at the nominal amount.
Government documents stipulate that government grants used to purchase, build or otherwise form
long-term assets are classified as government grants related to assets. If the government documents
concerning a government grant do not specify the target of the grant, it should be determined based on
the basic conditions that must be met in order to receive the grant, and government grants which are
conditional upon a long-term asset acquired, constructed or otherwise formed are classified as asset-
related government grants. Government grants related to assets are used to offset carrying value of assets
or are recognized as deferred income. If recognized as deferred income, government grants related to
assets shall be recorded in the profit and loss in stages in a reasonable and systematic manner within the
useful life of the relevant asset. Government grants measured at nominal amount were directly
recognized as profit or loss for the current period. If the underlying assets were sold, transferred,
scrapped, or damaged before the end of the useful life, the unallocated balance of the relevant deferred
income was transferred to the profit or loss for the period of assets disposal.
Government grants other than government grants related to assets were classified as government
grants related to income. For government grants, including both asset-related parts and income-related
parts that are difficult to be distinguished, overall government grants shall be classified as government
grants related to income. Government grants related to income shall be recognized as deferred income if
they are used to compensate related future expenses or losses and recorded in profit and loss of the
current period during the period when relevant expenses are recognized, or shall be recognized as
current profit and loss or offset the related costs if they are used to compensate related expenses or losses
incurred.
relevant costs according to the substance of business activities. Government grants that are not related to
daily activities are recognized as non-operating income and expenses.
√ Applicable □ Not applicable
(the difference between the tax base and the carrying value, where tax bases of items that are not
Annual Report 2021
recognized as assets and liabilities can be determined according to the tax law), deferred income tax
assets or deferred income tax liabilities are recognized in accordance with the applicable tax rates during
the expected period in which such assets are to be recovered or such liabilities are to be settled.
that is likely to be obtained and deducted from deductible temporary difference. On the balance sheet
date, if there is conclusive evidence that it is probable that sufficient taxable income will be available to
offset the deductible temporary differences in the future, the deferred income tax assets that have not
been recognized in the previous accounting period shall be recognized.
determined that the Company is not Period likely to obtain adequate taxable income to offset benefits
from deferred tax assets, the carrying values of deferred tax assets are written down. Such write-downs
are reversed when it becomes probable that sufficient taxable income should be available.
loss of the current period as income tax expenses or incomes, excluding the income taxes incurred in the
following circumstances: (1) Business combination; (2) Transactions or events directly recognized in the
owner's equity.
(1). Accounting treatment method for operating lease
√ Applicable □ Not applicable
On the beginning date of the lease term, the Company will recognize the lease with a lease term not
exceeding 12 months and excluding the purchase option as a short-term lease. Leases with lower value
when a single leased asset is a brand-new asset are identified as low-value asset leases. If the Company
sublets or expects to sublet the leased assets, the original lease shall not be deemed as a low-value asset
lease.
The Company records the payments of short-term and low-value asset leases incurred during each
period of the lease term in the relevant asset costs or the profit or loss for the current period by the
straight-line method.
The Company will recognize right-of-use assets and lease liabilities on the inception date of the
lease term, excluding the above short-term and low-value asset leases.
(1) Right-of-use assets
Right-of-use assets are initially measured at costs, including: 1) The initial measurement amount of
lease liabilities; 2) If there is a lease incentive for the lease payment paid on or before the start date of
the lease term, the relevant amount of the lease incentive already enjoyed shall be deducted; 3) Initial
direct expenses incurred by the lessee; 4) The expected cost to be borne by the lessee in order to
dismantle and remove the assets leased, restore original state of the place where the assets leased are in,
or restore the assets leased to the state stipulated in the lease terms.
The Company depreciates right-of-use assets on a straight-line basis. If it is reasonably certain that
Annual Report 2021
ownership of the leased asset(s) will be obtained at the end of the lease term, the Company depreciates
the leased asset(s) over its/their remaining service life. If it is not reasonably certain that the ownership
of the leasehold property will be obtained at the end of the lease term, the Company will depreciate the
leased asset(s) over the lease term or the remaining service life, whichever is shorter.
On the balance sheet date, if there is any sign that right-of-use assets are impaired, the
corresponding impairment reserve shall be made according to the difference between the carrying value
and the recoverable amount.
(2) Lease liabilities
On the start date of the lease term, the Company recognizes the present value of the outstanding
lease payments as lease liabilities. The Company regards the interest rate implicit in lease as the rate of
discount when calculating the present value of the lease payment. The incremental lending rate of the
lessee will be deemed as the rate of discount, if the interest rate implicit in lease cannot be confirmed.
The difference between the lease payment and its present value is regarded as an unrecognized financing
expense. Interest expense is recognized at the discount rate of the present value of the recognized lease
payment during each period of the lease term and is recorded in the profits and losses of the current
period. Variable lease payments that are not recorded in the lease liabilities measurement are recorded in
profits and losses of the current period when they are actually incurred.
After the start of the lease term, in case of any changes in actual fixed payment amount, the
expected payable amount of the guarantee residual value, the index or ratio used to determine the lease
payment amount, and the evaluation result or actual exercise of the purchase option, renewal option or
termination option, the Company will re-calculate the lease obligation using the present value of the
changed lease payment, and adjusts the carrying value of right-of-use assets accordingly. If the carrying
value of right-of-use assets has been reduced to zero, while lease liabilities still needs to be further
reduced, the remaining amount will be recorded in the profits and losses of the current period.
On the start date of the lease term, the Company divides the lease that substantially transfers almost
all risks and rewards related to the ownership of the leased assets into finance leases, except for
operating leases.
The Company recognizes the lease payments receivable as rental earnings in each period within the
lease term on a straight-line basis. The initial direct costs related to the operating lease are capitalized,
amortized within the lease term on the same basis as the recognition of rental earnings, and included in
the profit or loss for the current period. Variable lease payments obtained by the Company in relation to
operating leases that are not included in the lease receivable are included in the profit or loss for the
current period when they are actually incurred.
(2). Accounting treatment method for finance lease
□ Applicable √ Not applicable
(3). Definition method and accounting treatment method of lease under the new lease standards
□ Applicable √ Not applicable
Annual Report 2021
□ Applicable √ Not applicable
(1). Changes in important accounting policy
√ Applicable □ Not applicable
Remarks (Name and amount of
Contents of and reasons for the
Approval procedure items in the statement suffering
changes to accounting policies
significant influence)
Changes in accounting policies Implement new standards Refer to other notes
caused by changes in
Accounting Standards For
Business Enterprises
Other notes:
From 1 January 2021 (hereinafter referred to as the "date of initial adoption"), the Company started
to adopt the revised Accounting Standards for Business Enterprises No. 21 – Leases (hereinafter referred
to as the "new lease standards").
For a contract already existing prior to the date of initial adoption, the Company will decide not to
reassess whether it is a lease or includes any lease.
For the lease contract for which the Company is the lessee, the Company adjusts the retained
earnings at the beginning of the reporting period and the amount of other related items in the financial
statements according to the cumulative impact of the implementation of the new lease standards and the
original standards on the date of initial adoption, and does not adjust the information of comparable
periods. The specific accounting processing is as follows:
For a finance lease before its date of initial adoption, the lessee shall, on the date of initial adoption,
measure the right-of-use asset and the lease liability respectively according to the original carrying value
of the assets acquired under finance lease and the finance lease payable.
For operating leases prior to the date of initial adoption, the Company measures lease liabilities at
the present value of the remaining lease payments discounted at the Company's incremental borrowing
rate at the date of initial adoption, and measures right-of-use assets at an amount equal to lease liabilities,
with necessary adjustments based on prepaid rent.
On the date of initial adoption, the Company shall test the impairment of right-of-use assets and
carry out corresponding accounting treatment in accordance with the aforesaid provisions on impairment
of long-term assets in this section.
The main impacts of the implementation of the new lease standards on the Company's financial
statements on 1 January 2021 are as follows:
Balance Sheet
Item
adjustment impact
Right-of-use assets 21,484,142.88 21,484,142.88
Current portion of 9,622,886.25 9,622,886.25
non-current liabilities
Lease liabilities 11,861,256.63 11,861,256.63
Annual Report 2021
(2). Key changes in accounting estimates
□ Applicable √ Not applicable
(3). Adjustments to the financial statements at the beginning of the year of implementation of the
new lease standards for the first time since 2021
√ Applicable □ Not applicable
Consolidated Balance Sheet
Unit: RMB Currency: RMB
Adjustment
Item 31 December 2020 1 January 2021
number
Right-of-use assets 21,484,142.88 21,484,142.88
Current portion of non-current
liabilities
Lease liabilities 11,861,256.63 11,861,256.63
Explanation of adjustments of each item:
□ Applicable √ Not applicable
(4). Explanation of retroactive adjustment of previous comparative data for the first time since
□ Applicable √ Not applicable
√ Applicable □ Not applicable
Hedge accounting
investment in foreign operations.
with it: (1) The hedging relationship is only composed of qualified hedging instruments and hedged
instruments; (2) At the beginning of hedging, the Company formally designated hedging instruments and
hedged items, and prepared written documents on hedging relationship and risk management strategies
and risk management objectives of the Company engaged in hedging; (3) The hedging relationship
meets the requirements of hedging effectiveness.
When the hedging meets the following conditions at the same time, the Company determines that
the hedging relationship meets the requirements of hedging effectiveness: (1) There is an economic
relationship between the hedged item and the hedging instrument; (2) Credit risk does not play a
dominant role in the value changes caused by the economic relationship between hedged items and
hedging instruments; (3) The hedging ratio of the hedging relationship is equal to the ratio of the number
of hedged items actually hedged by the Company to the actual number of hedging instruments, but does
not reflect the imbalance of the relative weights of hedged items and hedging instruments.
The Company continuously evaluates whether the hedging relationship meets the hedging
effectiveness requirements on and after the hedging start date. If the hedging relationship no longer
meets the requirements of hedging effectiveness due to the hedging ratio, but the risk management
objectives of the designated hedging relationship have not changed, the Company shall rebalance the
hedging relationship.
(1) Fair value hedge
period. If the hedging instrument is used to hedge a non-trading equity instrument (or a component
Annual Report 2021
thereof) that is chosen to be measured at fair value and whose changes are included in other
comprehensive income, the gains or losses arising from the hedging instrument are included in other
comprehensive income.
loss of the current period and meanwhile the carrying value of the hedged item not measured at fair
value shall be adjusted. If a hedged item is classified as financial assets (or a component thereof) that are
measured at fair value and whose changes are recorded in other comprehensive income according to
Article 18 of Accounting Standards for Business Enterprises No.22-Recognition and Measurement of
Financial Instruments, its gains or losses due to hedged risk exposure are recorded in profit and loss of
the current period, and its carrying value has been measured at fair value and will not be adjusted. If the
hedged item is a non-trading equity instrument investment (or a component thereof) that the Company
chooses to measure at fair value and its changes are recorded in other comprehensive income, the gains
or losses arising from the hedged risk exposure are recorded in other comprehensive income, and its
carrying value has been measured at fair value and will not be adjusted.
If a hedged item is an unrecognized firm commitment (or a component thereof), the cumulative
changes in the fair value arising from hedged risk after the designation of hedging relationship shall be
recognized as an asset or liability, and the related gain or loss shall be recorded in profit and loss of the
respective periods. In case of acquiring assets or bearing liabilities for performing a firm commitment,
the initially recognized amount of the assets or liabilities shall be adjusted to include the cumulative
changes in the fair value of the recognized hedged item.
If a hedged item is a financial instrument (or a component thereof) at measured amortized cost, the
adjustment to the carrying value of the hedged item shall be amortized based on the actual interest rate
recalculated on the commencement date of amortization and recorded in profit and loss of the current
period. If a hedged item is classified as financial assets (or a component thereof) that are measured at
fair value and whose changes are recorded in other comprehensive income according to Article 18 of
Accounting Standards for Business Enterprises No.22-Recognition and Measurement of Financial
Instruments, cumulative recognized hedging gains or losses are amortized in the same manner and
recorded in profit and loss of the current period, but the carrying value of financial assets (or their
components) is not adjusted.
(2) Cash flow hedge
included in the other comprehensive income as a reserve for cash flow hedges, and the invalid part is
included in profit and loss of the current period. The amount of reserve for cash flow hedges is
recognized as the absolute amount of the lower of the following two items: A. The cumulative gains or
losses of hedging instruments since hedging; B. The cumulative change in the present value of the
estimated future cash flows of the hedged item since hedging.
subsequently recognize a non-financial asset or non-financial liability, or the forecast transaction of the
non-financial asset or non-financial liability forms a recognized commitment to which fair value hedge
accounting is applicable, the original amount of reserve for cash flow hedges recognized in other
comprehensive income shall be transferred out and recorded in the initially recognized amount of such
non-financial asset or non-financial liability.
Annual Report 2021
other comprehensive income is transferred out during the same period when the hedged expected
transaction affects the profit and loss, and is recorded in the profit and loss of the current profit.
(3) Net investment hedge in a foreign operation
The part of the gains or losses formed by hedging instruments that belong to effective hedging is
recognized as other comprehensive income, and when disposing of foreign operations, it is transferred
out and recorded in the profit and loss of the current profit. The part of the gains or losses resulting from
hedging instruments that belong to invalid hedging shall be recorded in profit and loss of the current
period.
VI Taxation
Major types of taxes and tax rates
√ Applicable □ Not applicable
Tax Tax basis Tax rate
Revenue from commodity sales and taxable services
calculated according to the tax law are the basic
VAT calculation of output tax. After deducting the amount
of input tax which is allowed to be deducted in the
current period, the difference is the VAT payable.
Ad valorem tax: levied at 1.2% of the remaining value
after deducting 30% from the original value of the
Real estate tax 1.2%, 12%
housing property; Tax levied from rent: levied at 12%
of the rental income.
Urban
maintenance and Turnover tax paid 5%, 7% [Note 2]
construction tax
Educational fee Turnover tax paid 3%
Local educational
Turnover tax paid By 2%
fee
Enterprise
Amount of taxable income 25%, 20%, 15%, 8.25%
income tax
[Note 1] The tax of the Company's main products is levied at the tax rate of 13%, and VAT of
interest income is levied at the tax rate of 6%; VAT of the real estate rental income of subsidiaries
Banmen Electric Appliance and Shanghai Gongniu is levied at a tax rate of 5% according to the simple
method; VAT of Lingbo Gongniu's real estate rental income is partly levied at a tax rate of 5% and
partly at 9% according to the simple method.
[Note 2] Electric Sales is levied at a tax rate of 7%, and other companies at a tax rate of 5%
Explanation of disclosure if different income tax rates apply to different corporate taxpayers
√ Applicable □ Not applicable
Name of taxpayer Income tax rate (%)
The Company 15
Ningbo Gongniu 15
Gongniu Photoelectric 15
Gongniu Digital 15
Bull HK 8.25
Xingluo Trading 20
Other taxpayers except the above 25
Annual Report 2021
√ Applicable □ Not applicable
(YGQRL [2020] No.1) issued by the Leading Group for the Identification and Management of High-tech
Enterprises in Ningbo on 15 January 2020, the Company was identified as a high-tech enterprise in
Ningbo in 2019, and its qualification is valid for 3 years. From 2019 to 2021, the Company enjoys a
preferential corporate income tax rate of 15%.
(YGQRL [2020] No.1) issued by Beilun District Science and Technology Bureau of Ningbo on 15
January 2021, Gongniu Digital was recognized as a high-tech enterprise in Ningbo in 2020, and its
qualification is valid for 3 years. From 2020 to 2022, Gongniu Digital enjoys a preferential corporate
income tax rate of 15%.
by Beilun District Science and Technology Bureau of Ningbo on 19 January 2022, Ningbo Gongniu and
Gongniu Photoelectric were recognized as high-tech enterprises in Ningbo in 2020, and their
qualification is valid for 3 years. From 2021 to 2023, Ningbo Gongniu and Gongniu Photoelectric enjoy
a preferential corporate income tax rate of 15%.
Micro Enterprises (C.SH. [2019] No. 13) issued by the Ministry of Finance and the State Taxation
Administration and the Announcement on Issues Related to Implementing Inclusive Income Tax
Reduction and Exemption Policy for Small Low-profit Enterprises (State Administration of Taxation
Announcement No. 2 in 2019) issued by the State Administration of Taxation, from 1 January 2019 to
RMB1 million (including RMB1 million) shall be included in the taxable revenue at a reduced rate of
taxable revenue exceeds RMB1 million but not more than RMB3 million shall be included in the taxable
revenue at a reduced rate of 50%, and the corporate revenue tax shall be levied at the tax rate of 20%.
According to the Announcement on the Implementation of Preferential Income Tax Policies for Small-
and Micro-sized Enterprises and Individual Industrial and Commercial Entities (No. 12 of 2021) issued
by the Ministry of Finance and the State Taxation Administration, from 1 January 2021 to 31 December
RMB1 million, the corporate income tax will be levied by half on the basis of the preferential policies
stipulated in Article 2 of the Tax Credit Policies for Small and Micro Enterprises (C.SH. [2019] No. 13)
issued by the Ministry of Finance and the State Taxation Administration.
Xingluo Trading meets the recognition criteria of small low-profit enterprises, and pays corporate
income tax at the preferential tax rate of small low-profit enterprises.
□ Applicable √ Not applicable
Annual Report 2021
VII Notes to the Consolidated Financial Statements
√Applicable □Not applicable
Unit: RMB
Item Closing balance Opening balance
Cash on hand
Bank deposits 4,230,383,599.91 3,659,966,981.92
Other monetary assets 87,372,876.35 80,072,357.23
Interest receivable 59,472,080.48 12,818,522.27
Total 4,377,228,556.74 3,752,857,861.42
Of which: Total
amount deposited 217,966.13 267,996.52
overseas
Other notes:
The closing balance of other monetary assets includes futures margin of RMB25,988,465.80, cash
deposits for L/G of RMB6,654,782.17, bank acceptance margin of RMB2,333,774.75, and account
margin for third-party payment platform of RMB63,000.00.
√Applicable □Not applicable
Unit: RMB
Item Closing balance Opening balance
Financial assets at fair value through
profit or loss
Of which:
Banking WM products 1,936,600,000.00 2,213,300,000.00
Details of trust products 1,120,000,000.00 650,000,000.00
Asset management plan 2,670,000,000.00
Securities return voucher 200,000,000.00
Total 5,926,600,000.00 2,863,300,000.00
Other notes:
√Applicable □Not applicable
(1) Description of held-for-trading financial assets with restrictions on realization
The closing balance of held-for-trading financial assets includes closed-end wealth management
products worth RMB3,722,000,000.00.
(2) Details of banking wealth management products
Item Closing balance Opening balance Category
Non-principal-guaranteed
CMBC Tiantian Zengli 372,000,000.00
floating income
CMBC Fuzhu Bond,
Automatically Renewed
Public Wealth Non-principal-guaranteed
Management Products, floating income
with a Holding Period of
value Private Placement Non-principal-guaranteed
Products of Bank of floating income
Ningbo
Ningxin Semi-annual
Regular Open Wealth
Management Product No. Non-principal-guaranteed
BNB Wealth Management
Co., Ltd., Bank of Ningbo
Annual Report 2021
Ningxin One-year Regular
Open Wealth Management
Product No. 34 with Fixed Non-principal-guaranteed
Income of BNB Wealth floating income
Management Co., Ltd.,
Bank of Ningbo
CMBC Corporate Wealth
Non-principal-guaranteed
Management Product 125,200,000.00
floating income
Ririxin 80008
Ningxin Closed Wealth
Management Product No.
Non-principal-guaranteed
floating income
BNB Wealth Management
Co., Ltd., Bank of Ningbo
CMBC Extraordinary
Asset Management Daily
Non-principal-guaranteed
Profit-increasing Wealth 100,000,000.00
floating income
Management Products
(Institutional Funds)
Ningxin Closed Wealth
Management Product No.
Non-principal-guaranteed
floating income
BNB Wealth Management
Co., Ltd., Bank of Ningbo
Ningxin One-year Regular
Open Wealth Management
Product No. 32 with Fixed Non-principal-guaranteed
Income of BNB Wealth floating income
Management Co., Ltd.,
Bank of Ningbo
"ABC Pay at Any Time"
Open RMB Wealth Non-principal-guaranteed
Management Products of floating income
ABC Wealth Management
Everbright Cash A of Non-principal-guaranteed
Everbright Bank floating income
value Private Placement Non-principal-guaranteed
Products of Bank of floating income
Ningbo
Ningxin Semi-annual
Regular Open Wealth
Management Product No. Non-principal-guaranteed
BNB Wealth Management
Co., Ltd., Bank of Ningbo
ICBC "TLB" Net-value
Non-principal-guaranteed
Wealth Management 16,900,000.00 18,000,000.00
floating income
Products
ABC "Golden Key, Anxin
Profits 90 Days" RMB Non-principal-guaranteed
Wealth Management floating income
Products
ABC Huilifeng "2020 No.
Non-principal-guaranteed
floating income
Deposit Products
Annual Report 2021
Customized for
Corporates"
ABC "Golden Key, Anxin
Express" Open RMB
Non-principal-guaranteed
Wealth Management 213,300,000.00
floating income
Products with Daily Profits
Earning
Net-value Wealth
Non-principal-guaranteed
Management Product No. 138,000,000.00
floating income
CMBC Structural Deposits Non-principal-guaranteed
with Linked Interest Rate floating income
Jingyao One-year Regular
Open Wealth Management
Product No. 1 with Fixed Non-principal-guaranteed
Income of BNB Wealth floating income
Management Co., Ltd.,
Bank of Ningbo
Intelligent Regular Wealth
Non-principal-guaranteed
Management Product No. 50,000,000.00
floating income
CCB "Qianyuan-Daily
Profit Increase" RMB
Non-principal-guaranteed
Wealth Management 14,000,000.00
floating income
Products with Open-ended
Asset Portfolio
Subtotal 1,936,600,000.00 2,213,300,000.00
(3) Details of trust products
Item Closing balance Opening balance Category
Financial City Hongyu No.
Non-principal-guaranteed
floating income
Trust
Xicheng Profit Increase -
Non-principal-guaranteed
Fund Trust of Huaneng 300,000,000.00
floating income
Guicheng Trust
Xinyue Fengli Series
Non-principal-guaranteed
Collective Fund Trust Plan 240,000,000.00
floating income
of Shanghai Trust
Everbright Securities
Everbright Trust -
Non-principal-guaranteed
Shengyuan Profit- 200,000,000.00 50,000,000.00
floating income
increasing Bond Collective
Fund Trust Plan
Xinxiang Bond Investment
Non-principal-guaranteed
Collective Fund Trust Plan 30,000,000.00
floating income
of CITIC Trust
"Ruby" Safe and Stable
Series Investment Fund Non-principal-guaranteed
Trust Plan of Shanghai floating income
Trust
Subtotal 1,120,000,000.00 650,000,000.00
(4) Asset management plan
Item Closing balance Opening balance Category
Yuexiang No. 1 Collective
Non-principal-guaranteed
Asset Management Plan of 800,000,000.00
floating income
Everbright Securities Asset
Annual Report 2021
Management, Everbright
Securities
Niannianwang Collective
Asset Management Plan of Non-principal-guaranteed
Haitong Securities Asset floating income
Management
Huatai Zijin Collective
Non-principal-guaranteed
Asset Management Plan of 400,000,000.00
floating income
Huatai Securities
Yuxiang No. 1 Collective
Asset Management Plan of
Non-principal-guaranteed
Everbright Securities Asset 250,000,000.00
floating income
Management, Everbright
Securities
Yuxiang No. 2 Collective
Asset Management Plan of
Non-principal-guaranteed
Everbright Securities Asset 220,000,000.00
floating income
Management, Everbright
Securities
Yongxin Single Asset
Management Plan of
Non-principal-guaranteed
Yongxing Securities Asset 200,000,000.00
floating income
Management, Yongxing
Securities
Niannianwang No.88
Collective Asset
Non-principal-guaranteed
Management Plan of 150,000,000.00
floating income
Haitong Securities Asset
Management
Financing Business, Debt
Income Right Transfer and Non-principal-guaranteed
Forward Transfer Contract floating income
of Founder Securities
Everbright Sunshine Big
Dipper Star No. 7
Non-principal-guaranteed
Collective Asset 90,000,000.00
floating income
Management Plan of
Everbright Securities
Everbright Sunshine Big
Dipper Star No. 6
Non-principal-guaranteed
Collective Asset 60,000,000.00
floating income
Management Plan of
Everbright Securities
Subtotal 2,670,000,000.00
(5) Securities return voucher
Item Closing balance Opening balance Category
Xingdong Series
Automatically-redeemed
Principal-guaranteed
Floating Return Voucher 50,000,000.00
floating income
No. 65 of Industrial
Securities (CSI 500 Long)
Return Voucher
Principal-guaranteed
"JinTianli" No. D184 of 50,000,000.00
floating income
Founder Securities
Guangjing Series Return Principal-guaranteed
Voucher No. 30 of floating income
Annual Report 2021
Everbright Securities
Xingzhi Series Dansha
Floating Return Voucher
Principal-guaranteed
No. 107of Industrial 50,000,000.00
floating income
Securities (Ningbo) (CSI
Subtotal 200,000,000.00
√Applicable □Not applicable
Unit: RMB
Item Closing balance Opening balance
Hedge instruments - Commodity future
contract
Total 3,613,050.00 27,159,170.00
Other notes:
The Company hedged raw materials such as copper and plastic particles purchased, performed
accounting treatment as cash flow hedges, and recorded the profit on the book in the derivative financial
assets.
(1). Notes receivable listed by category
√Applicable □Not applicable
Unit: RMB
Item Closing balance Opening balance
Bank acceptance bill
Commercial acceptance bill 750,723.35
Total 750,723.35
(2). Notes receivable pledged by the Company at the end of the period
□Applicable √Not applicable
(3). Notes receivable endorsed by the Company or discounted and not due on the balance sheet
date at the end of the period
□Applicable √Not applicable
(4). Notes transferred to accounts receivable because the drawer failed to execute the contract or
agreement at the end of the period
□Applicable √Not applicable
(5). Classified disclosure based on the bad debt provision method
√Applicable □Not applicable
Unit: RMB
Closing balance Opening balance
Carrying balance Bad debt provision Carrying balance Bad debt provision
Category Accrued Carrying Accrued Carrying
Proportion Proportion
Amount Amount proportion value Amount Amount proportion value
(%) (%)
(%) (%)
Bad debt
provision
accrued by
item
Of which:
Bank
acceptance
bill
Trade
acceptance
Annual Report 2021
Bad debt
provision
accrued by
portfolio
Of which:
Bank
acceptance
bill
Trade
acceptance
Total 1,152,045.82 / 401,322.47 / 750,723.35 / /
Bad debt provision accrued by item:
√Applicable □Not applicable
Unit: RMB
Closing balance
Name Bad debt Accrued Reason for
Carrying balance
provision proportion (%) accruing
Tianjin Qirun Real
Expected to be
Estate Development 150,000.00 150,000.00 100.00
unrecoverable
Co., Ltd.
Kaiping Fulin No.2
Expected to be
Textile & Garment 135,456.06 135,456.06 100.00
unrecoverable
Co., Ltd.
Dongguan Rongda
Real Estate Expected to be
Development Co., unrecoverable
Ltd.
Hainan Huafeng
Expected to be
Huarui Industrial Co., 25,468.92 25,468.92 100.00
unrecoverable
Ltd.
Total 361,810.71 361,810.71 100.00 /
Notes to bad debt provision accrued by item:
□Applicable √Not applicable
Bad debt provision accrued by portfolio:
√Applicable □Not applicable
Item for which bad debt provision is accrued by portfolio: Trade acceptance
Unit: RMB
Closing balance
Name
Notes receivable Bad debt provision Accrued proportion (%)
Trade acceptance
portfolio
Total 790,235.11 39,511.76 5.00
Criteria and explanation of bad debt provision accrued by portfolio
□Applicable √Not applicable
To accrue bad debt provision under the expected general model of credit loss, please refer to the
disclosure of other receivables:
□Applicable √Not applicable
(6). Status of bad debt provision
√Applicable □Not applicable
Unit: RMB
Changes for the current period
Opening Closing
Category Accrued Reversed or Charged-off
balance balance
amount recovered or written-off
Bad debt
provision 361,810.71 361,810.71
accrued by item
Annual Report 2021
Bad debt
provision
accrued by
portfolio
Total 401,322.47 401,322.47
Of which significant amount of recovered or transferred-back bad debt provision for the current period:
□Applicable √Not applicable
(7). Written-off notes receivable for the current period
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
(1). Disclosure by aging
√Applicable □Not applicable
Unit: RMB
Aging Closing carrying amount
Within one year
Of which: Sub-items within one year
Subtotal within one year 229,304,992.42
Total 230,995,739.56
(2). Classified disclosure based on the bad debt provision method
√Applicable □Not applicable
Unit: RMB
Closing balance Opening balance
Carrying balance Bad debt provision Carrying balance Bad debt provision
Category Accrued Carrying Accrued Carrying
Proportion value Proportion value
Amount Amount proportion Amount Amount proportion
(%) (%)
(%) (%)
Bad debt
provision
accrued by
item
Bad debt
provision
accrued by 230,995,739. 11,735,99 219,259,74 9,763,917. 183,928,6
portfolio 56 6.31 3.25 29 13.94
Total 100.00 5.08 193,692,531.23 100.00 5.04
Bad debt provision accrued by item:
□Applicable √Not applicable
Bad debt provision accrued by portfolio:
√Applicable □Not applicable
Unit: RMB
Closing balance
Name
Accounts receivable Bad debt provision Accrued proportion (%)
Within one year 229,304,992.42 11,465,249.63 5.00
Total 230,995,739.56 11,735,996.31 5.08
Criteria and explanation of bad debt provision accrued by portfolio:
□Applicable √Not applicable
To accrue bad debt provision under the expected general model of credit loss, please refer to the
disclosure of other receivables:
Annual Report 2021
□Applicable √Not applicable
(3). Status of bad debt provision
√Applicable □Not applicable
Unit: RMB
Changes for the current period
Opening Charged-off
Category Accrued Reversed or Other Closing balance
balance or written-
amount recovered changes
off
Bad debt
provision
accrued 9,763,917.29 2,796,678.02 824,599.00 11,735,996.31
by
portfolio
Total 9,763,917.29 2,796,678.02 824,599.00 11,735,996.31
Of which significant amount of recovered or transferred-back bad debt provision for the current period:
□Applicable √Not applicable
(4). Status of written-off accounts receivable for the current period
√Applicable □Not applicable
Unit: RMB
Item Written-off amount
Written-off accounts receivable 824,599.00
Of which the writing-off of significant accounts receivable
□Applicable √Not applicable
Notes to written-off accounts receivable:
□Applicable √Not applicable
(5). Status of accounts receivable of the top five closing balances by the parties in arrears
√Applicable □Not applicable
Unit: RMB
Proportion in total
closing balances of Closing balance of
Name of entity Closing balance
accounts receivable bad debt provision
(%)
Beijing Jingdong Century
Trading Co., Ltd.
ALPHA.LTD 38,031,684.76 16.46 1,901,584.24
BELKIN INTERNATIONAL,
INC.
Zhejiang TMALL Technology
Co., Ltd.
Beijing Jingdong Yaohong
Trading Co., Ltd.
Total 161,789,070.50 70.04 8,089,453.52
(6). Accounts receivable derecognized due to transfers of financial assets
□Applicable √Not applicable
(7). Amount of assets and liabilities formed due to transfer of accounts receivable and continuous
involvement
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
√Applicable □Not applicable
Unit: RMB
Item Closing balance Opening balance
Annual Report 2021
Bank acceptance bill 927,023.00 161,562.83
Total 927,023.00 161,562.83
Increase or decrease of receivables financing and changes in fair value for the current period:
□Applicable √Not applicable
To accrue bad debt provision under the expected general model of credit loss, please refer to the
disclosure of other receivables:
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
(1). Prepayments listed by aging
√Applicable □Not applicable
Unit: RMB
Closing balance Opening balance
Aging
Amount Proportion (%) Amount Proportion (%)
Within one
year
Over 3 years 37,500.00 0.13
Total 29,140,223.00 100.00 34,711,617.31 100.00
(2). Status of the top five advance payments in the closing balances by prepaid subject
√Applicable □Not applicable
Proportion in total closing balances
Name of entity Closing balance
of prepayments (%)
Jiangxi Chishuo Technology Co.,
Ltd.
Guangxi Jingdong Xinjie E-
commerce Co., Ltd.
Hangzhou Fan Jia Technology Co.,
Ltd.
Hangzhou Alimama Software
Service Co., Ltd.
Jiangsu Jingdong Information
Technology Co., Ltd.
Total 13,548,988.73 46.50
Other notes:
□Applicable √Not applicable
List of items
√Applicable □Not applicable
Unit: RMB
Item Closing balance Opening balance
Interest receivable
Dividends receivable
Other receivables 195,924,505.99 126,043,394.07
Total 195,924,505.99 126,043,394.07
Other notes:
□Applicable √Not applicable
Interest receivable
(1). Category of interest receivables
□Applicable √Not applicable
Annual Report 2021
(2). Significant overdue interest
□Applicable √Not applicable
(3). Status of accrued bad debt provision
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
Dividends receivable
(1). Dividends receivable
□Applicable √Not applicable
(2). Significant dividends receivable aged over one year
□Applicable √Not applicable
(3). Status of accrued bad debt provision
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
Other receivables
(1). Disclosure by aging
√Applicable □Not applicable
Unit: RMB
Aging Closing carrying amount
Within one year
Of which: Sub-items within one year
Subtotal within one year 107,279,727.87
Over 3 years 4,841,063.05
Total 230,269,105.78
(2). Classification by nature of payments
√Applicable □Not applicable
Unit: RMB
Nature Closing carrying amount Opening carrying amount
Call money 111,000,000.00 110,407,671.23
Guaranteed deposit 101,781,134.68 7,024,541.50
Housing loan for employees 16,817,779.29 19,980,032.65
Refund of tax for export
receivable
Others 670,191.81 440,120.15
Total 230,269,105.78 138,939,432.41
(3). Status of accrued bad debt provision
√Applicable □Not applicable
Unit: RMB
Stage 1 Stage 2 Stage 3
Expected loss for the Expected credit
Bad debt Expected credit
entire duration losses for the entire Total
provision loss in the next 12
(without credit duration (with credit
months
impairment) impairment)
Balance as at
January 1, 6,113,832.87 757,910.65 6,024,294.82 12,896,038.34
Balance on
January 1,
Annual Report 2021
current period
- Transferred
-5,741,825.89 5,741,825.89
to Stage 2
- Transferred
-815,286.01 815,286.01
to Stage 3
- Transferred
back to Stage
- Transferred
back to Stage
Amount
accrued for
the current
period
Amount
transferred-
back for the
current period
Amount
charged-off
for the current
period
Amount
written-off for
the current
period
Other changes
Balance as at
Notes to significant changes in the carrying amount of other receivables for which changes in the loss
reserve for the current period occurred:
□Applicable √Not applicable
The amount of bad debt provision for the current period and the basis for assessing whether the credit
risk of financial instruments has increased significantly:
□Applicable √Not applicable
(4). Status of bad debt provision
√Applicable □Not applicable
Unit: RMB
Changes for the current period
Reversed Charged-
Category Opening balance Accrued Other Closing balance
or off or
amount changes
recovered written-off
Bad debt
provision
accrued by
item
Bad debt
provision
accrued by
portfolio
Total 12,896,038.34 21,548,561.45 100,000.00 34,344,599.79
Of which the bad debt provision recovered or transferred-back with significant amount during the
Reporting Period:
Annual Report 2021
□Applicable √Not applicable
(5). Status of written-off other receivable for the current period
√Applicable □Not applicable
Unit: RMB
Item Written-off amount
Written-off other receivables 100,000.00
Status of written-off other significant receivables:
□Applicable √Not applicable
Notes of writing-off of other receivables:
□Applicable √Not applicable
(1). Status of other receivables of the top five closing balances by the parties in arrears
√Applicable □Not applicable
Unit: RMB
Proportion in
Bad debt
Closing total closing
Name of entity Nature Aging provision
balance balances of other
Closing balance
receivables (%)
Sunac Real Call money 110,000,000.00 47.77 22,000,000.00
years
Estate Group
Interest on Within one
[Notes] 1,000,000.00 0.43 50,000.00
call money year
Shanghai
Caohejing
Development
Zone
Zhaoxiang Guaranteed Within one
Emerging deposit year
Industry
Economic
Development
Co., Ltd.
Cixi Public
Resources Guaranteed Within one
Trading deposit year
Center
Administrative Within one
Committee of year
Zhejiang Cixi
Guaranteed
Binhai
deposit Over 3
Economic 250,000.00 0.11 250,000.00
years
Development
Zone
Beijing
Jingdong
Guaranteed Within one
Century 800,000.00 0.35 40,000.00
deposit year
Trading Co.,
Ltd.
Total / 209,150,852.00 / 90.83 27,195,042.60
(6). Accounts receivable involving government grants
□Applicable √Not applicable
(7). Other receivables derecognized due to transfers of financial assets
□Applicable √Not applicable
Annual Report 2021
(8). Amount of assets and liabilities formed due to transfer of other receivables and continuous
involvement
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
(1). Classification of inventories
√Applicable □Not applicable
Unit: RMB
Closing balance Opening balance
Shrinkage
Shrinkage reserves
reserves for
for
inventories/depre
Item inventories/deprec
Carrying balance Carrying amount Carrying balance ciation reserves Carrying amount
iation reserves for
for contract
contract
performance
performance costs
costs
Raw
materials
Goods in
process
Merchandi
se on hand
Merchandi
se shipped
Commissio
ned 57,323,866.45 57,323,866.45 39,638,756.02 39,638,756.02
products
Packaging
material
Low-value
consumabl 10,298,408.48 10,298,408.48 8,969,233.99 8,969,233.99
es
Total 1,386,374,831.61 9,387,709.01 1,376,987,122.60 794,915,655.90 6,675,595.59 788,240,060.31
(2). Shrinkage reserves for inventories/depreciation reserves for contract performance costs
√Applicable □Not applicable
Unit: RMB
Increased amount for the Decreased amount for the
Closing balance
current period current period
Item Opening balance
Transferred-back
Accrued amount Others Others
or charged-off
Merchandise
on hand
Total 6,675,595.59 7,512,895.82 4,800,782.40 9,387,709.01
Other notes:
The specific basis for determining the net realizable value, the reasons for the shrinkage reserves for
transferred-back or charged-off inventories for the current period
The reasons for
The reasons for
The specific basis for shrinkage reserves for
shrinkage reserves for
Item determining the net transferred-back
charged-off inventories
realizable value inventories for the
for the current period
current period
The net realizable value For the current period,
Merchandise on hand is determined by the inventories, which
estimated selling price accrued shrinkage
Annual Report 2021
deducting the estimated reserves, have been sold
selling expense and the
relevant taxes
(3). Notes of the amount of capitalized borrowing cost in the closing balance of inventories
□Applicable √Not applicable
(4). Notes of the amount of contract performance costs amortized for the current period
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
(1). Status of contract assets
□Applicable √Not applicable
(2). The amount and reason for significant changes in carrying value during the Reporting Period
□Applicable √Not applicable
(3). Status of depreciation reserves accrued for contract assets for the current period
□Applicable √Not applicable
To accrue bad debt provision under the expected general model of credit loss, please refer to the
disclosure of other receivables:
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
□Applicable √Not applicable
□Applicable √Not applicable
Significant debt investments and other debt investments at the end of the period:
□Applicable √Not applicable
√Applicable □Not applicable
Unit: RMB
Item Closing balance Opening balance
Contract acquisition costs
Refund costs receivable
Structural bank deposits 1,114,551,150.68 2,726,587,945.21
Input VAT to be credited 10,534,966.75 3,721,828.78
Advance payment of enterprise
income tax
Total 1,126,520,898.44 2,741,389,939.38
(1). Status of debt investments
□Applicable √Not applicable
(2). Significant debt investments at the end of the period
□Applicable √Not applicable
(3). Status of accrued depreciation reserves
□Applicable √Not applicable
The amount of the depreciation reserves for the current period and the basis for assessing whether the
credit risk for financial instruments has increased significantly
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
Annual Report 2021
(1). Status of other debt investments
□Applicable √Not applicable
(2). Significant other debt investments at the end of the period
□Applicable √Not applicable
(3). Status of accrued depreciation reserves
□Applicable √Not applicable
The amount of the depreciation reserves for the current period and the basis for assessing whether the
credit risk for financial instruments has increased significantly
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
(1). Status of long-term receivables
□Applicable √Not applicable
(2). Status of accrued bad debt provision
□Applicable √Not applicable
The amount of the bad debt reserves for the current period and the basis for assessing whether the credit
risk for financial instruments has increased significantly
□Applicable √Not applicable
(3). Long-term receivables derecognized due to transfers of financial assets
□Applicable √Not applicable
(4). Amount of assets and liabilities formed due to transfer of long-term receivables and
continuous involvement
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
□Applicable √Not applicable
(1). Status of other equity investments
□Applicable √Not applicable
(2). Status of an equity investment that is not held for trading
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
Measurement model of investment property
Not applicable
List of items
√Applicable □Not applicable
Unit: RMB
Item Closing balance Opening balance
Fixed assets 1,489,874,874.31 1,180,444,953.99
Fixed assets liquidation 3,858,246.51 1,338,464.52
Annual Report 2021
Total 1,493,733,120.82 1,181,783,418.51
Other notes:
□Applicable √Not applicable
Fixed assets
(1). Status of fixed assets
√Applicable □Not applicable
Unit: RMB
Houses and Machinery Means of Electronic and Fixed assets
Item Total
buildings equipment transportation other equipment fixtures
I. Original Carrying Value:
balance
Increased
amount for 357,359,333.97 176,023,514.99 4,930,975.31 18,463,495.63 4,434,459.19 561,211,779.09
the current
period
(1)
Purchase
(2)
Transfer-in
of
constructio
n in
progress
Decreased
amount for 7,218,308.80 73,931,026.90 5,482,643.10 5,773,217.88 92,405,196.68
the current
period
(1)
Disposed 7,218,308.80 73,931,026.90 5,482,643.10 5,773,217.88 92,405,196.68
or scrapped
(2) Other
decreases
balance 5
II. Accumulated Depreciation
balance
Increased
amount for 53,127,442.69 120,515,881.73 5,416,662.87 18,428,269.98 8,935,983.90 206,424,241.17
the current
period
(1)
Accrued 53,127,442.69 120,515,881.73 5,416,662.87 18,428,269.98 8,935,983.90 206,424,241.17
amount
Decreased
amount for 1,013,624.27 44,264,126.81 4,875,103.40 5,638,952.04 55,791,806.52
the current
period
(1)
Disposed
Annual Report 2021
or scrapped
(2) Other
decreases
balance
III. Depreciation Reserves
balance
Increased
amount for 8,124,587.26 619,640.18 8,744,227.44
the current
period
(1)
Accrued 8,124,587.26 619,640.18 8,744,227.44
amount
Decreased
amount for
the current
period
(1)
Disposed
or scrapped
balance
IV. Carrying Value
carrying 933,448,007.45 512,699,170.24 3,901,712.05 19,500,028.27 20,325,956.30 1,489,874,874.31
value
carrying 635,420,800.70 494,983,024.33 4,994,939.31 20,218,708.64 24,827,481.01 1,180,444,953.99
value
(2). Status of temporarily idle fixed assets
□Applicable √Not applicable
(3). Status of fixed assets obtained by finance lease
□Applicable √Not applicable
(4). Fixed assets rented out by operating lease
√Applicable □Not applicable
Unit: RMB
Item Closing carrying value
Houses and buildings 2,705,236.81
Subtotal 2,705,236.81
(5). Status of fixed assets without certificate of title
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
Fixed assets liquidation
√Applicable □Not applicable
Unit: RMB
Item Closing balance Opening balance
Scrapped machinery equipment yet
to be completely disposed
Total 3,858,246.51 1,338,464.52
Annual Report 2021
List of items
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
Construction in progress
(1). Status of construction in progress
√Applicable □Not applicable
Unit: RMB
Closing balance Opening balance
Item Carrying Depreciation Carrying Carrying Depreciation Carrying
balance reserves amount balance reserves amount
R&D center
and
headquarters
base
construction
project
Base
construction
project for
annual output
of 180
million sets
of LED
lamps
Construction
project for
automation
upgrading of
annual output
of 400
million sets
of converters
Information
construction 3,539,851.67 3,539,851.67 1,659,106.72 1,659,106.72
project
Base
construction
project for
annual output
of 410 2,156,275.13 2,156,275.13 113,087,757.59 113,087,757.59
million sets
of wall
switches and
sockets
Equipment to
be installed
Other small
projects
Total 198,364,136.97 198,364,136.97 278,130,656.14 278,130,656.14
Annual Report 2021
(2). Significant changes in the construction in progress for the current period
√Applicable □Not applicable
Unit: RMB
Of which:
Amount of Proportion Amount of Capitalization
Accumulated
Increased fixed assets Other of project capitalized rate of Source
Opening Closing Job amount of
Project Budget amount for the transferred-in decreased investment interests interest for of
balance balance schedule capitalized
current period for the current amount to budget for the the current fund
interest
period (%) current period (%)
period
R&D center
and
headquarters Fund
base raising
construction
project
Base
construction
project for
annual Fund
output of raising
sets of LED
lamps
Construction
project for
automation
upgrading of
Fund
annual 999,036,300.00 132,436,589.06 105,897,216.90 224,053,767.82 14,280,038.14 25.19 25.19
raising
output of
sets of
converters
Annual Report 2021
Information
Fund
construction 240,350,000.00 1,659,106.72 4,524,397.93 2,643,652.98 3,539,851.67 2.57 2.57
raising
project
Base
construction
project for
annual
Fund
output of 1,204,528,600.00 113,087,757.59 52,456,993.84 163,388,476.30 2,156,275.13 21.75 21.75
raising
sets of wall
switches and
sockets
Equipment
Equity
to be 3,772,450.17 91,552,886.44 66,820,690.91 28,504,645.70
fund
installed
Other small Equity
projects fund
Total 3,895,951,000.00 278,130,656.14 418,940,828.99 498,707,348.16 198,364,136.97
Annual Report 2021
(3). Status of accrued depreciation reserves for construction in progress for the current
period
□Applicable √Not application
Other notes:
□Applicable √Not applicable
Engineering materials
(4). Status of engineering materials
□Applicable √Not applicable
(1). Productive living assets measured at cost
□Applicable √Not applicable
(2). Productive living assets measured at fair value
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
□Applicable √Not applicable
√Applicable □Not applicable
Unit: RMB
Item Houses and buildings Total
I. Original Carrying Value
current period
Rented 8,570,641.70 8,570,641.70
current period
Disposed amount
II. Accumulated Depreciation
current period
(1) Accrued amount 11,244,984.87 11,244,984.87
current period
(1) Disposed amount
III. Depreciation Reserves
current period
(1) Accrued amount
Annual Report 2021
current period
(1) Disposed amount
IV. Carrying Value
Other notes:
The difference between the opening amount for the period and the year-end balance of the
previous year (December 31, 2020) is detailed in the notes of "Important Accounting Policies and
Accounting Estimates" and "44. Changes in Significant Accounting Policies and Accounting
Estimates" in the "Section 10 Financial Report" of the Annual Report.
(1). Status of intangible assets
√Applicable □Not applicable
Unit: RMB
Patent Non-patent Patent and
Item Land use right Software Total
right technologies know-how
I. Original Carrying Value
balance
amount for the 12,324,352.31 12,324,352.31
current period
(1) Purchase 12,324,352.31 12,324,352.31
(2) Internal
R&D
(3) Increase of
business
integration
(4) Transfer-in
of construction
in progress
amount for the 227,707.36 227,707.36
current period
(1) Disposed
amount
balance
II. Accumulated Amortization
balance
amount for the 6,176,756.89 10,281,457.79 16,458,214.68
current period
(1) Accrued
amount
amount for the
Annual Report 2021
current period
(1) Disposed
amount
balance
III. Depreciation Reserves
balance
amount for the
current period
(1) Accrued
amount
amount for the
current period
(1) Disposed
amount
balance
IV. Carrying Value
carrying value
carrying value
At the end of the period, the intangible assets formed through internal R&D of the Company
accounted for 0.00% of the balance of intangible assets.
(2). Status of land use right without certificate of title
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
□Applicable √Not applicable
(1). Original carrying value of goodwill
□Applicable √Not applicable
(2). Depreciation reserves for goodwill
□Applicable √Not applicable
(3). Information related to cash-generating units or groups of cash-generating units where
goodwill is in
□Applicable √Not applicable
(4). Describe the goodwill depreciation testing process, key parameters (e.g., expect growth
rate during the forecast period when the present value of future cash flows, growth rate
during the stabilization period, profit margin, discount rate, forecast period, etc., if
applicable) and the method of recognizing impairment losses of goodwill.
□Applicable √Not applicable
Annual Report 2021
(5). Impact of the goodwill impairment test
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
√Applicable □Not applicable
Unit: RMB
Increased
Amortization Other
Opening amount for Closing
Item amount of the decreased
balance the current balance
period amount
period
Talent
Shareholding
Plan
Total 3,150,000.00 26,592,932.00 6,701,548.01 5,290,548.00 17,750,835.99
Other notes:
For details of the 2020 Special Talent Shareholding Plan, please refer to "5. Others" in "XIII.
Share-based Payment" of "Section 10 Financial Report" of the Annual Report.
(1). Deferred income tax assets not offset
√Applicable □Not applicable
Unit: RMB
Closing balance Opening balance
Item Deductible Deferred Deductible Deferred
temporary income tax temporary income tax
differences Assets differences Assets
Allowance for
impairment losses on
assets
Unrealized profit of
intra-company 131,943,914.81 32,868,900.61 105,549,134.11 26,374,103.51
transaction
Deductible losses
Discount on sale
accrued in advance
Uncovered losses 15,579,787.48 3,894,946.87
Restricted share
incentive scheme
Shrinkage reserves for
inventories
Bad debt provision for
accounts receivable
Shareholding Plan
Total 484,224,232.51 116,456,369.78 276,905,674.33 66,903,177.28
(2). Deferred income tax liabilities not offset
√Applicable □Not applicable
Unit: RMB
Annual Report 2021
Closing balance Opening balance
Item Taxable Deferred Taxable Deferred
temporary income tax temporary income tax
difference LIABILITIES difference LIABILITIES
Estimated added value
of assets not under the
same control
Changes in the fair
value of other debt
investments
Changes in the fair
value of other equity
investments
Depreciation policy on
fixed assets subject to 309,268,738.92 50,024,829.68 246,146,941.29 38,154,381.04
tax variances
Gain and loss of hedge
instrument included in
the other
comprehensive income
Total 310,289,897.39 50,280,119.30 284,641,899.01 47,778,120.47
(3). Deferred income tax assets or liabilities listed by net debt after being offset
□Applicable √Not applicable
(4). Details of deferred income tax assets details were not confirmed
√Applicable □Not applicable
Unit: RMB
Item Closing balance Opening balance
Deductible temporary
differences
Deductible losses 46,483,443.12 11,515,440.62
Total 90,303,193.60 25,310,651.32
(5). Deductible losses from unrecognized deferred income tax assets will mature in the
following years
√Applicable □Not applicable
Unit: RMB
Year Closing amount Opening amount Remarks
Total 46,483,443.12 11,515,440.62 /
Other notes:
□Applicable √Not applicable
√Applicable □Not applicable
Unit: RMB
Closing balance Opening balance
Item Carrying Depreciation Carrying Carrying Depreciation Carrying
balance reserves amount balance reserves amount
Contract
acquisition
Annual Report 2021
costs
Contract
performance
costs
Refund costs
receivable
Contract
assets
Prepayment
for 43,400,700.
equipment 00
acquisition
Talent 46,400,000.
Shareholding 00
Plan
Prepayment
for 26,990,656.00 26,990,656.00
investment
Total 76,068,914.50 76,068,914.50 89,800,700.00
Other notes:
Share-based Payment” of "Section 10 Financial Report" of the Annual Report. 2. On August 18,
(Shanghai) Inc. (hereinafter referred to as "Dalitek") and its shareholders BRIDGES
ELECTRONIC TECHNOLOGY CO., LTD. and Shanghai Houqi Investment Center (Limited
Partnership) and natural person shareholders Pan Xiaobin and Zhang Wenying, agreeing that 70%
of the equity interests of the Company held by the shareholders be transferred at the price of
RMB91 million, the down payment of RMB63.7 million shall be made within 10 business days
after the completion of the relevant procedures and the delivery of the assets, and the remaining
equity transfer payment shall be made in three years in line with the completion of the
performance commitment. As at 13 December 2021, the Company had paid a total of
RMB26.9907 million for the equity transfer, which had not yet reached 50% of the amount
payable, so Dalitek was not included in the Company's 2021 consolidated financial statements. On
million for the down payment, which completed the down payment for the equity transfer.
Annual Report 2021
(1). Classification of short-term borrowings
√Applicable □Not applicable
Unit: RMB
Item Closing balance Opening balance
Pledged loans
Mortgage loans
Guaranteed loans 500,000,000.00
Unsecured loans 500,000,000.00
Interest payable on short-term
borrowings
Total 500,430,555.55 500,344,611.11
(2). Status of short-term borrowings that have been overdue but not repaid
□Applicable √Not applicable
Of which, the status of significant overdue short-term borrowings that are not repaid is as follows:
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
□Applicable √Not applicable
□Applicable √Not applicable
(1). List of notes payable
√Applicable □Not applicable
Unit: RMB
Category Closing balance Opening balance
Trade acceptance
Bank acceptance bill 2,333,774.75
Total 2,333,774.75
The total amount of notes payable that has expired but remained unpaid at the end of the period is
RMB0.00.
(1). List of accounts payable
√Applicable □Not applicable
Unit: RMB
Item Closing balance Opening balance
Payment for goods 1,580,297,065.42 1,206,190,690.42
Payment for engineering
equipment
Payment for expense 52,072,881.39 49,053,096.34
Total 1,701,686,564.14 1,285,822,466.71
(2). Significant accounts payable aged over one year
□Applicable √Not applicable
Other notes:
Annual Report 2021
□Applicable √Not applicable
(1). List of advance receipts
□Applicable √Not applicable
(2). Significant advances from customers aged over one year
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
(1). Status of contract liabilities
√Applicable □Not applicable
Unit: RMB
Item Closing balance Opening balance
Advance receipt of payment
for goods
Total 437,999,921.93 333,741,780.65
(2). Significant changes in the amount of carrying value and the reason in the Reporting
Period
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
(1). List of employee benefits payable
√Applicable □Not applicable
Unit: RMB
Increase for the Decrease for the
Item Opening balance Closing balance
current period current period
I. Short-term Employee
Benefits
II. Post-employment Benefit -
Defined Contribution Plan
III. Termination Benefits 3,653,347.34 3,653,347.34
IV. Other Benefits That
Expire within One Year
Total 244,138,167.00 1,776,328,614.40 1,741,003,308.97 279,463,472.43
(2). List of short-term employee benefits
√Applicable □Not applicable
Unit: RMB
Increase for the Decrease for the
Item Opening balance Closing balance
current period current period
I. Salary, Bonus, Allowance
and Subsidy
II. Employee Benefits Cost 53,064,392.19 53,064,392.19 -
III. Social Insurance Premiums 916,967.74 59,994,623.21 55,728,192.64 5,183,398.31
Of which: Medical insurance
premiums
Annual Report 2021
Work-related injury insurance
premiums
Maternity insurance premiums
IV. Housing Allowance 110,742.00 43,832,256.05 43,810,291.05 132,707.00
V. Labor Union Expense and
Employee Education Budget
VI. Short-term Paid Absence
VII. Short-term Profit Sharing
Plan
Total 238,790,661.64 1,678,352,557.29 1,645,835,739.01 271,307,479.92
(3). List of defined contribution plan
√Applicable □Not applicable
Unit: RMB
Increase for the Decrease for the
Item Opening balance Closing balance
current period current period
premiums
payment
Total 5,347,505.36 94,322,709.77 91,514,222.62 8,155,992.51
Other notes:
□Applicable √Not applicable
√Applicable □Not applicable
Unit: RMB
Item Closing balance Opening balance
VAT 195,348,236.75 213,100,996.81
Consumption tax
Business tax
Enterprise income tax 305,914,943.40 195,359,429.80
Personal income tax
Urban maintenance and
construction tax
Real estate tax 10,692,552.05 7,294,975.55
Land use tax 4,695,105.35 4,549,989.64
Personal income tax withheld
and remitted
Educational fee 2,387,890.63 2,763,217.77
Local educational fee 1,591,927.11 1,842,145.19
Stamp duty 877,508.40 896,168.00
Disability insurance 1,695,195.50 144,225.72
Total 533,077,969.51 437,873,048.07
List of items
√Applicable □Not applicable
Unit: RMB
Item Closing balance Opening balance
Interest payable
Dividends payable
Annual Report 2021
Other payables
Discount on sale accrued in
advance
Guaranteed deposit 61,020,316.08 56,445,206.58
Accrued expenses 46,433,533.02 22,268,751.16
Obligations of restricted stock
repurchase within one year
Temporary receipts and
advances payable
Total 430,813,760.10 219,091,086.62
Other notes:
□Applicable √Not applicable
Interest payable
(1). List by category
□Applicable √Not applicable
Dividends payable
(2). List by category
□Applicable √Not applicable
Other payables
(1). List of other payables by nature of payment
□Applicable √Not applicable
(2). Significant other payables aged over one year
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
□Applicable √Not applicable
√Applicable □Not applicable
Unit: RMB
Item Closing balance Opening balance
Long-term borrowings due
within one year
Bonds payable due within
one year
Long-term payables due
within one year
Lease liabilities due within
one year
Long-term borrowings due
within one year -- interest 686,888.90
payable
Total 673,911,937.53 9,622,886.25
Other notes:
The difference between the opening amount for the period and the year-end balance of the
previous year (31 December 2020) is detailed in the notes of "V. Significant Accounting Policies
Annual Report 2021
and Accounting Estimates" and "44. Changes in important accounting policies and accounting
estimation" in "Section 10 Financial Report" of the Annual Report.
Status of other current liabilities
√Applicable □Not applicable
Unit: RMB
Item Closing balance Opening balance
Short-term bonds payable
Refunds payable
Output VAT to be charged
off
Total 56,939,989.86 43,285,234.93
Increase/decrease of short-term bonds payable:
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
(1). Classification of long-term borrowings
√Applicable □Not applicable
Unit: RMB
Item Closing balance Opening balance
Pledged loans
Mortgage loans
Guaranteed loans 160,000,000.00
Unsecured loans
Interest payable on long-term
borrowings
Total 160,037,333.33
Other notes, including interest rate range:
□Applicable √Not applicable
(1). Bonds payable
□Applicable √Not applicable
(2). Changes in bonds payable: (excluding other financial instruments such as preference
shares and perpetual bonds, which are classified as financial liabilities)
□Applicable √Not applicable
(3). Notes of the conditions for the conversion of convertible corporation bonds and the time
of conversion
□Applicable √Not applicable
(4). Notes of other financial instruments classified as financial liabilities
Basic information about other financial instruments outstanding such as preference shares and
perpetual bonds at the end of the period
□Applicable √Not applicable
Annual Report 2021
Changes in financial instruments outstanding such as preference shares and perpetual bonds at the
end of the period
□Applicable √Not applicable
Notes of basis for the classification of other financial instruments as financial liabilities:
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
√Applicable □Not applicable
Unit: RMB
Item Closing balance Opening balance
The amount of the lease payment
that has not yet been made
Minus: Unrecognized financing
expenses
Total 5,089,837.39 11,861,256.63
Other notes:
The difference between the opening amount for the period and the year-end balance of the
previous year (31 December 2020) is detailed in the notes of "V. Significant Accounting Policies
and Accounting Estimates" and "44. Changes in important accounting policies and accounting
estimation" in "Section 10 Financial Report" of the Annual Report.
List of items
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
Long-term payables
(1). Long-term payables listed by nature of payment
□Applicable √Not applicable
Specific payables
(2). Special payables listed by nature of payments
□Applicable √Not applicable
□Applicable √Not applicable
□Applicable √Not applicable
Status of deferred income
□Applicable √Not applicable
Item involving government grants:
□Applicable √Not applicable
Annual Report 2021
Other notes:
□Applicable √Not applicable
√Applicable □Not applicable
Unit: RMB
Item Closing balance Opening balance
Contract liabilities
Obligations of restricted stock
repurchase for over one year
Total 46,125,187.50 28,037,156.40
√Applicable □Not applicable
Unit: RMB
Increase/Decrease (+/-)
Opening Provident Closing
Issuance
balance Bonus fund balance
New Others Subtotal
shares Conversion
shares
of capital
Total
shares
Other notes:
According to the resolution of the Company's 2020 Annual General Meeting and the Fifth
Meeting of the Second Board of Directors, the Company granted 668,400 restricted shares to 523
incentive subjects at a grant price of RMB88.15 per share. The Company raised
RMB58,919,460.00 from employees, which was included in share capital of RMB668,400.00 and
capital reserves (share capital premium) of RMB58,251,060.00.
In 2021, due to the departure of employees participating in the restricted share incentive
scheme, the Company repurchased 101,680 shares of restricted shares, reducing share capital by
RMB101,680.00 and capital reserves (share capital premium) by RMB7,706,536.40.
(1). Basic information about other financial instruments outstanding such as preference
shares and perpetual bonds at the end of the period
□Applicable √Not applicable
(2). Changes in financial instruments outstanding such as preference shares and perpetual
bonds at the end of the period
□Applicable √Not applicable
Increase and decrease of other equity instruments for the current period, the reason for the changes,
and the basis of the relevant accounting treatment:
□Applicable √Not applicable
Annual Report 2021
Other notes:
□Applicable √Not applicable
√Applicable □Not applicable
Unit: RMB
Increase for the Decrease for the
Item Opening balance Closing balance
current period current period
Additional
paid-in capital
(Additional
share capital)
Other capital
reserves
Total 3,820,175,608.14 101,599,216.82 7,706,536.40 3,914,068,288.56
Other notes, including a description of the increase or decrease for the current period and the
reasons for the change:
The increase in the Company's capital reserves (share capital premium) was attributable to
the restricted share premium of RMB58,251,060.00; the decrease in the Company's capital
reserves (share capital premium) was attributable to the reduction of RMB7,706,536.40 from the
Company's repurchase of restricted shares.
Based on the performance appraisal conditions and service vesting period of the restricted
shares, the Company recognized the share incentive cost of RMB41,090,453.82, which was
included in capital reserves (other capital reserves) of RMB41,090,453.82. Based on the grant of
the 2020 Special Talent Shareholding Plan, the Company transferred part of the granted share of
the 2020 Special Talent Shareholding Plan to the long-term prepaid expense by vesting period,
increasing the long-term prepaid expense by RMB21,302,384.00, increasing capital reserves by
RMB2,257,703.00, and reducing the other non-current assets RMB19,044,681.00.
√Applicable □Not applicable
Unit: RMB
Increase for the Decrease for the
Item Opening balance Closing balance
current period current period
Treasury shares 46,728,594.00 58,919,460.00 24,936,514.00 80,711,540.00
Total 46,728,594.00 58,919,460.00 24,936,514.00 80,711,540.00
Other notes, including a description of the increase or decrease for the current period and the
reasons for the change:
The increase in treasury shares for the current period is the result of the Company's 2021
restricted share incentive scheme, as detailed in the description in "53. Share capital" in "VII.
Notes to Items in the Consolidated Financial Statements" of "Section 10 Financial Report".
Annual Report 2021
The decrease of treasury shares for the current period is due to the repurchase of restricted
shares of resigned employees, a decrease of treasury shares worth RMB7,907,976.40; the partial
unlocking of the 2020 restricted share incentive scheme caused a decrease of treasury shares worth
RMB16,407,537.60; the cash dividend of RMB2 (including tax) per share in 2021 caused decrease
of treasury shares worth RMB621,000.00.
√Applicable □Not applicable
Unit: RMB
Amount for the current period
Minus:
Minus:
Profits and
Retained
losses of
earnings of
other
other
comprehen
Amount comprehens Attributa
sive
before ive income Attributable to ble
Opening income Minus: Closing
Item deducting recorded the Company minority
balance recorded Income tax balance
income tax for for the as the parent sharehol
for the expense
the current previous after tax ders after
previous
period period and tax
period and
transferred
transferred
to the
to the
current
current
period
period
I. Other
Comprehensive
Income That Will
Not Be
Reclassified to
Profit or Loss
Of which:
Changes caused
by
remeasurements
on defined benefit
schemes
Other
comprehensive
income that will
not be reclassified
to profit or loss
under the equity
method
Changes in the
fair value of other
equity investments
Changes in the
fair value arising
from changes in
own credit risk
II. Other
Comprehensive -
Income That Will 28,863,769.91 9,368,449.8 -21,326,379.54 7,537,390.37
Be Reclassified to 1
Profit or Loss
Of which: Other
comprehensive
income that will
Annual Report 2021
be reclassified to
profit or loss under
the equity method
Changes in the
fair value of other
debt investments
Other
comprehensive
income arising
from the
reclassification of
financial assets
Credit
impairment
allowance for
other debt
investments
Reserve for cash -
flow hedges 30,693,435.89
Differences
arising from the
translation of
foreign currency- -7,448.38 -1,393.46 -1,393.46 -8,841.84
denominated
financial
statements
Other -
comprehensive 28,863,769.91 9,368,449.8 -21,326,379.54 7,537,390.37
income in total 1
□Applicable √Not applicable
√Applicable □Not applicable
Unit: RMB
Increase for the Decrease for the
Item Opening balance Closing balance
current period current period
Statutory surplus
reserves
Any surplus
reserves
General reserves
Enterprise
expansion fund
Others
Total 302,797,998.73 302,797,998.73
√Applicable □Not applicable
Unit: RMB
Item 2021 2020
Last closing retained earnings
before adjustment
Total opening retained earnings
adjustment (increase +, decrease -)
Opening retained earnings after
adjustment
Annual Report 2021
Plus: Net profit attributable to the
owners of the parent at the 2,780,360,732.66 2,313,430,074.14
beginning of the current period
Minus: Withdrawal of statutory
surplus reserves
Withdrawal of any surplus
reserves
Withdrawal of general reserve
Dividends of common shares
payable
Dividends of common shares
converted to share capital
Closing retained earnings 6,010,878,918.97 4,431,669,986.31
Other notes:
On 20 May 2021, the Company held the 2020 Annual General Meeting and deliberated and
approved the 2020 annual profit distribution plan, and based on the total share capital registered
on the record date of the implementation of the equity distribution, distributed a cash drain of
RMB20.00 (including tax) to all shareholders for every 10 shares, for a total of
RMB1,201,151,800.00.
(1). Status of operating revenue and cost of sales
√Applicable □Not applicable
Unit: RMB
Item
Revenue Cost Revenue Cost
Principal
business
Others 48,045,647.22 17,777,912.37 29,847,209.32 11,902,306.36
Total 12,384,916,337.51 7,808,540,666.84 10,051,128,834.05 6,018,606,539.57
(2). Status of contract revenue
□Applicable √Not applicable
Details of contract revenue:
□Applicable √Not applicable
(3). Details of obligation for contract performance
□Applicable √Not applicable
(4). Details of the apportionment to the remaining obligations for contract performance
□Applicable √Not applicable
Other notes:
None
√Applicable □Not applicable
Unit: RMB
Item 2021 2020
Business tax
Urban maintenance and
construction tax
Annual Report 2021
Educational fee 17,945,609.53 18,179,685.07
Local educational fee 12,118,900.15 12,119,789.99
Tax on natural resources
Real estate tax 10,754,950.02 7,691,038.95
Land use tax 4,791,701.11 4,582,664.97
Vehicle and vessel usage tax 53,029.46 44,571.09
Stamp duty 5,560,108.84 5,051,471.90
Environment protection tax 15,293.60
Total 21,175,083.03 80,328,346.74
√Applicable □Not applicable
Unit: RMB
Item 2021 2020
Employee remuneration 261,647,749.30 253,150,571.42
Marketing expense 217,339,450.58 175,830,273.21
Travel expense 34,695,865.40 38,247,815.04
Administrative expense 32,909,137.36 24,066,926.31
Lease rental 1,976,612.98 11,404,814.01
Advertising expense 5,339,637.47 9,815,456.12
Others 6,278,549.71 5,330,676.02
Total 560,187,002.80 517,846,532.13
√Applicable □Not applicable
Unit: RMB
Item 2021 2020
Employee remuneration 214,964,097.72 203,445,228.96
Administrative expense 56,125,085.23 44,504,315.74
Depreciation and amortization 43,934,085.95 92,318,399.02
Expense for restricted share incentive
scheme
House and equipment maintenance
expense
Consultant service expense 20,597,126.42 17,561,464.44
Expense for 2020 Special Talent
Shareholding Plan
Entertainment expense 5,788,268.11 5,579,623.46
Lease rental 2,455,152.98 8,437,527.58
Tax 2,864,245.72 3,466,884.55
Others 6,236,257.87 8,497,352.59
Total 427,615,556.97 430,706,547.54
√Applicable □Not applicable
Unit: RMB
Item 2021 2020
R&D of converters 204,811,830.81 175,510,933.90
R&D of wall switches and sockets 141,889,975.17 125,115,667.60
R&D of LED 53,911,159.57 49,714,843.43
R&D of digital accessories 41,413,616.82 43,749,365.85
R&D of circuit breakers 11,834,088.08 7,090,879.50
R&D of domestic electrical appliance 17,154,346.37
Annual Report 2021
Total 471,015,016.82 401,181,690.28
√Applicable □Not applicable
Unit: RMB
Item 2021 2020
Interest expense 39,763,491.76 9,718,888.89
Interest income -128,887,165.64 -49,748,785.37
Exchange gain or loss 1,365,206.44 3,282,033.90
Auxiliary expense 1,194,046.81 1,010,376.04
Cash discount -1,277,860.69
Total -87,842,281.32 -35,737,486.54
√Applicable □Not applicable
Unit: RMB
Item 2021 2020
Government grants related to
income
Employment VAT reduction
or exemption for veterans and 416,950.00 544,850.00
key groups
Return of auxiliary expense
for individual income tax 2,322,217.53 470,121.00
withheld
Total 390,936,141.47 127,179,310.75
Other notes:
The government grants included in other income for the current period are detailed in the
explanation in "84. Government grants" in "VII. Notes to Items in the Consolidated Financial
Statements" of "Section 10 Financial Report" of the Annual Report
√Applicable □Not applicable
Unit: RMB
Item 2021 2020
Earnings of long-term equity investments
accounted for by the equity method
Disposal of return on investment resulting from
long-term equity investments
Return on investment of held-for-trading
financial assets for the holding period
Dividend income of other equity investments
gained for the holding period
Interest income of debt investments gained for
the holding period
Interest income of other debt investments for the
holding period
Return on investment gained from disposal of
held-for-trading financial assets
Return on investment gained from disposal of
other equity investments
Return on investment gained from disposal of
debt investments
Return on investment gained from disposal of
Annual Report 2021
other debt investments
Earnings of debt restructuring
Return on investment of bank financing 171,623,256.63 165,861,739.74
Investment in futures 11,107,836.63 -114,631,050.00
Interest income of call money 7,294,215.55 407,671.23
Total 190,025,308.81 52,002,600.70
□Applicable √Not applicable
□Applicable √Not applicable
√Applicable □Not applicable
Unit: RMB
Item 2021 2020
Bad debt provision for notes
receivable
Bad debt provision for accounts
receivable
Bad debt provision for other
receivables
Depreciation reserves for debt
investments
Depreciation reserves for other debt
investments
Bad debt losses for long-term
receivables
Depreciation losses for contract assets
Bad debt loss -24,746,561.94 -7,435,665.10
Total -24,746,561.94 -7,435,665.10
√Applicable □Not applicable
Unit: RMB
Item 2021 2020
I. Bad Debt Loss
II. Inventories Shrinkage Loss and
Depreciation Loss of Contract -7,512,895.82 -6,675,595.59
Performance Cost
III. Depreciation Loss of Long-
term Equity Investments
IV. Depreciation Loss of
Investment Property
V. Depreciation Loss of Fixed
-8,744,227.44
Assets
VI. Depreciation Loss of
Engineering Materials
VII. Depreciation Loss of
Construction in Progress
VIII. Depreciation Loss of
Productive Living Assets
IX. Depreciation Loss of Oil and
Gas Assets
Annual Report 2021
X. Depreciation Loss of Intangible
Assets
XI. Depreciation Loss of Goodwill
XII. Miscellaneous
Total -16,257,123.26 -6,675,595.59
√Applicable □Not applicable
Unit: RMB
Item 2021 2020
Earnings from disposal of
-11,308,464.89 -669,979.13
fixed assets
Total -11,308,464.89 -669,979.13
Status of Non-operating income
√Applicable □Not applicable
Unit: RMB
Amount recorded in
Item 2021 2020 the current non-
recurring profit or loss
Total earnings from
disposal of non-
current assets
In which: Earnings
from disposal of
fixed assets
Earnings from
disposal of
intangible assets
Gains on exchange
of non-monetary
assets
Donation accepted
Government
subsidies
Default revenue of
dealers
Default revenue of
suppliers
Payment not
required to be made
Damages for
infringement
Others 103,363.88 20,988.20 103,363.88
Total 4,353,269.76 2,982,456.22 4,353,269.76
Government grants recorded in profit or loss for the current period
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
Annual Report 2021
√Applicable □Not applicable
Unit: RMB
Amount recorded in
Item 2021 2020 the current non-
recurring profit or loss
Total loss caused
by disposal of non- 1,593,839.71 18,258.05 1,593,839.71
current assets
Of which: Loss
caused by disposal
of fixed assets
Loss caused
by intangible assets
Loss caused by
exchange of non-
monetary assets
Donation 32,185,534.91 50,539,870.31 32,185,534.91
Fines expenditure 294,810,000.00 294,810,000.00
Payments cannot be
recovered
Compensation
expense
Others 43,227.39 66,725.79 43,227.39
Total 330,657,723.91 50,914,854.15 330,657,723.91
Other notes:
Details of donations:
Item 2021 2020
Red Cross Society of China
Cixi Branch
Peking University Education
Foundation
Cixi General Institution of
Charity
Red Cross Society of China
Ningbo Branch
Sichuan Province Leshan
Normal University Education 1,000,000.00
Development Foundation
Red Cross Society of China
Zhejiang Branch
Other petty donations 200,000.00 514,870.31
Total 32,185,534.91 50,539,870.31
(1). Table of income tax expense
√Applicable □Not applicable
Unit: RMB
Item 2021 2020
Income tax expense for the
current period
Deferred income tax expense -37,682,743.86 -8,981,772.14
Total 544,599,192.30 441,234,863.89
Annual Report 2021
(2). Process of adjusting accounted profit and income tax expense
√Applicable □Not applicable
Unit: RMB
Item 2021
Gross profit 3,324,959,924.96
Income tax expense by statutory/applicable
rates of tax
Influence of applying different tax rates by
subsidiaries
Influence of income tax before adjustment -859,475.32
Influence of non-taxable income
Influence of non-deductible costs, expenses
and losses
Influence of using deductible losses from
previously unconfirmed deferred income tax
assets
Influence of no deductible temporary
differences or deductible losses in deferred
income tax assets unconfirmed for the current
period
Influence of R&D and deductions -61,461,569.72
Income tax expense 544,599,192.30
Other notes:
□Applicable √Not applicable
□Applicable □Not applicable
(1). Other cash received from business activities
√Applicable □Not applicable
Unit: RMB
Item 2021 2020
Income from government subsidy 390,519,191.47 124,834,460.75
Deposit received 46,881,551.84 55,469,419.20
Interest income 82,233,607.43 36,930,263.10
Return of housing loan for
employees
Others 3,344,812.08 2,995,034.75
Total 525,426,517.23 223,463,038.80
(2). Cash payments related to other operating activities
√Applicable □Not applicable
Unit: RMB
Item 2021 2020
Out-of-pocket expense 705,132,660.86 664,628,863.42
Fine payment 294,810,000.00
Deposit payment 173,494,360.86 61,160,771.18
Donation expenditure 32,185,534.91 50,539,870.31
Plan
Annual Report 2021
Housing loan for employees 4,840,000.00 6,700,000.00
Others 3,264,696.97 6,363,682.43
Total 1,213,727,253.60 839,393,187.34
(3). Other cash received from investment activities
√Applicable □Not applicable
Unit: RMB
Item 2021 2020
Redemption of investments such as
bank wealth management
Recovery of futures deposit 241,233,253.72 143,416,262.00
Received interest on call money 7,200,000.00
Total 11,281,533,253.72 24,819,596,262.00
(4). Other cash paid for investment activities
√Applicable □Not applicable
Unit: RMB
Item 2021 2020
Investment expenditure such as
bank wealth management
Payment for futures deposit 180,500,000.00 278,900,000.00
Payment for equity transfer 26,990,656.00
Call money to other parties 110,000,000.00
Total 12,621,090,656.00 28,782,390,000.00
(5). Other cash received from funding activities
□Applicable √Not applicable
(6). Other cash paid for funding activities
√Applicable □Not applicable
Unit: RMB
Item 2021 2020
Repayment for lease liabilities 12,579,833.83
Repurchase of share incentive 7,808,216.40
Payment for listing 12,187,726.42
Total 20,388,050.23 12,187,726.42
(1). Supplemental information for cash flow statement
√Applicable □Not applicable
Unit: RMB
Supplemental information 2021 2020
Net profit 2,780,360,732.66 2,313,430,074.14
Add: Provision for impairment of
assets
Credit impairment loss 24,746,561.94 7,435,665.10
Depreciation of fixed assets, oil and
gas assets, and productive living 206,424,241.17 185,398,562.77
assets
Amortization of right-of-use assets 11,244,984.87
Amortization of intangible assets 16,458,214.68 48,155,030.75
Amortization of long-term prepaid
expense
Annual Report 2021
Loss caused by disposal of fixed
assets, intangible assets and other
long-term assets (gains represented
by "-")
Losses caused by scrapping fixed
assets (gains represented by "-")
Losses from changes in fair value
(gains represented by "-")
Finance costs (gains represented by
"-")
Investment loss (gains represented
-190,025,308.81 -52,002,600.70
by "-")
Decrease in deferred income tax
-49,553,192.50 -15,527,276.42
assets (increase represented by "-")
Increase in deferred income tax
liabilities (decrease represented by 11,870,448.64 6,545,504.28
"-")
Decrease in inventories (increase
-596,259,958.11 184,355,682.23
represented by "-")
Decrease in accounts receivable
generated from operating activities -190,636,989.81 -45,335,926.56
(gains represented by "-")
Increase in accounts payable used in
operating activities (decrease 869,359,175.52 763,337,045.56
represented by "-")
Others 43,348,156.82 20,596,194.94
Net cash generated from/used in
operating activities
payments
Conversion of debt to capital
Convertible corporate bonds
matured within 1 year
Fixed assets financing lease
Closing balance of cash 2,552,716,453.54 1,829,551,296.70
Less: Opening balance of cash 1,829,551,296.70 719,322,675.44
Plus: Closing balance of cash
equivalents
Less: Opening balance of cash
equivalents
Net increase in cash and cash
equivalents
(2). Net cash paid for the current period to acquire subsidiaries
□Applicable √Not applicable
(3). Net cash received for the disposal of subsidiaries for the current period
□Applicable √Not applicable
(4). Composition of cash and cash equivalents
√Applicable □Not applicable
Unit: RMB
Item Closing balance Opening balance
I. Cash 2,552,716,453.54 1,829,551,296.70
Annual Report 2021
Including: Cash on hand
Bank deposits on demand 2,500,383,599.91 1,827,166,981.92
Other monetary assets on
demand
Due from central banks that
can be used for payment
Due from banks and other
financial institutions
Interbank withdrawal
II. Cash Equivalents
Of which: Investment in bonds due
within three months
III. Cash and Cash Equivalents,
End of the Period
Other notes:
√Applicable □Not applicable
As at 31 December 2021, the balance of monetary assets was RMB4,377,228,556.74, the
balance of cash and cash equivalents was RMB2,552,716,453.54, the difference was
RMB1,824,512,103.20, which was the futures deposits of RMB25,988,465.80 not belonging to
cash and cash equivalents, the cash deposits for L/G was RMB6,654,782.17, and the bill deposits
was RMB2,333,774.75. The third party pays the platform deposit of RMB63,000.00, and the fixed
deposit of RMB1,730,000,000.00 and the interest of RMB59,472,080.48 that cannot be withdrawn
at any time.
As at 31 December 2020, the balance of monetary assets was RMB3,752,857,861.42, the
balance of cash and cash equivalents was RMB1,829,551,296.70, the difference was
RMB1,923,306,564.72, which was the futures deposits of RMB75,613,882.89 not belonging to
cash and cash equivalents, the cash deposits for L/G was RMB1,802,489.23, and the bill deposits
was RMB2,333,774.75. The third party pays the platform deposit of RMB171,000.00 and deposit
for contract performance of RMB100,670.33, and the fixed deposit of RMB1,832,800,000.00 and
the interest of RMB12,818,522.27 that cannot be withdrawn at any time.
Notes to the name of “Other” of closing balance of the same period of last year adjusted and the
amount adjusted:
□Applicable √Not applicable
√Applicable □Not applicable
Unit: RMB
Item Closing carrying value Reason for restriction
Monetary assets 35,040,022.72 Deposits that cannot be
Annual Report 2021
withdrawn at any time
Total 35,040,022.72 /
(1). Foreign currency monetary items
√Applicable □Not applicable
Unit: RMB
Closing balance
Closing foreign
Item Exchange rate converted to RMB
currency balance
balance
Monetary assets - -
Of which: USD 471,197.43 6.3757 3,004,213.45
EUR
HKD 31,664.30 0.8176 25,888.73
Accounts receivable - -
Of which: USD 9,564,990.25 6.3757 60,983,508.34
EUR
HKD
Long-term borrowings - -
Of which: USD
EUR
HKD
Accounts payable
Of which: USD 6,034.74 6.3757 38,475.69
(2). Notes to overseas operating entities, including: for important overseas operating entities,
their main overseas business location, bookkeeping base currency and basis for
selection should be disclosed, and the reasons for changes in the bookkeeping base
currency should also be disclosed
√Applicable □Not applicable
As Bull HK was established and carries out its operating activities in Hong Kong, its
bookkeeping base currency is HKD.
√Applicable □Not applicable
The hedge items, related hedging instruments, and qualitative and quantitative information about
hedged risks are disclosed by hedging category:
The Company used commodity future contracts to hedge the Company's exposure to raw
material price risks. The future contracts used by the Company are mainly the cathode copper
future standard contracts of the Shanghai Futures Exchange and the polypropylene standard
contracts of the Dalian Commodity Exchange.
Hedged items Expected bulk-purchase of raw materials such as copper and plastic
particles
Hedging instruments Commodity future contracts
Hedging method Commodity future purchase contracts locked in changes of price in
expected raw materials bulk-purchase contract
Annual Report 2021
The Company used commodity future contracts to hedge the expected bulk-purchase of raw
materials of copper and plastic particles to avoid the risk of fluctuations in the expected future
cash flows caused by the fluctuations in the market price of the above raw materials.
As at 31 December 2021, the pre-tax profit arising from the change in fair value of cash flow
hedging instruments that has been included in other comprehensive income was
RMB3,613,050.00. The futures have been delivered but the pre-tax profit of the inventories that
has not yet been deposited is RMB4,188,471.83.
(1). Basic information on government subsidy
√Applicable □Not applicable
Unit: RMB
Amount recorded in
Category Amount Listed items the current profit or
loss
Cixi City Cultivation
Incentives for Billion- 258,647,000.00 Other income 258,647,000.00
scale Enterprises
Financial subsidy for
Ningbo Meishan 66,730,000.00 Other income 66,730,000.00
Bonded Port Area
The 2020 fiscal
liquidation subsidy is 37,430,000.00 Other income 37,430,000.00
in place
Award for Industrial
Technology 5,311,800.00 Other income 5,311,800.00
Transformation
Investment
Workshop and
Industrial Investment
Technology
Transformation
Award
The 5th batch of
incentive funds for
key technology
research and
development in
Ningbo in 2021
Industrial Economy
Awards in 2020
Workshop and
Industrial Investment
Technology
Transformation
Award
Annual Report 2021
Award for key
manufacturing
enterprises whose
output value growth
rate reached the
standard and the new 800,000.00 Other income 800,000.00
manufacturing
enterprises above
designated size in
Ningbo in the fourth
quarter of 2020
Postdoctoral funding
from the Human
Resources and Social
Security Bureau
Characteristic Chinese 600,000.00 Other income 600,000.00
Software City Subsidy
Incentive for
Industrial Enterprises
in Binhai District
Enterprise
Informatization
Projects
for Green
Manufacturing Project
Enterprises
Cixi as hidden
champion of
exquisitely
manufactured
products in Zhejiang,
while Ningbo as
champion of single
items in 2020
Output value growth
rate standard rewards
for key manufacturing
enterprises in Ningbo
in the fourth quarter of
Award for Industrial
Technology 413,000.00 Other income 413,000.00
Transformation
Investment
Output value growth
rate standard rewards
for key manufacturing
enterprises in Ningbo
in the fourth quarter of
New apprenticeship
training in July and
Annual Report 2021
November 2021
Cixi's introduction of
scientific management 360,300.00 Other income 360,300.00
model awards in 2020
Design Award
Independent brand
products online sales
incentives for
consumer goods
industry enterprises in
Ningbo
Rewards for the
growth rate of key
enterprises in the third
quarter
Industrial Economics
Awards in 2020
Award for high-
strength and high-
conductivity XYK-32
copper alloy
application research
projects
Subsidies for work-
based training
Award for compliance
and pilot
demonstration of
integrated
management system 200,000.00 Other income 200,000.00
of informatization and
industrialization and
excellent industrial
APPs in Cixi in 2020
The 1st batch of
domestic authorized
invention patent 200,000.00 Other income 200,000.00
awards in Cixi City in
Subsidy for short-term
export credit 193,000.00 Other income 193,000.00
insurance
Cash-in reward for
service policy
implementation to 187,475.80 Other income 187,475.80
Guanhaiwei Town
Government
Subsidy for Enterprise
Informatization
Projects in Cixi in
Institution Incentive 170,000.00 Other income 170,000.00
Fund
Industrial Economy
Awards in 2020
Annual Report 2021
Open Economy
Financial support
funds for Xinzhuang
Industrial Zone in
The 1st batch of
domestic authorized
invention patent 120,000.00 Other income 120,000.00
awards in Cixi City in
Industrial Design 112,100.00 Other income 112,100.00
Award
Subsidy for further
accelerating the
economic 110,000.00 Other income 110,000.00
transformation and
development
The research and
development expenses
of enterprises with the 101,006.00 Other income 101,006.00
incentive deducted in
Cixi in 2020
Rewards for
enterprises that
retained employees,
hired talents, steadily
developed and
enhanced investment
in the first quarter in
Ningbo
Others 1,245,387.14 Other income 745,387.14
Subtotal 388,196,973.94 387,696,973.94
(2). Return of government subsidy
□Applicable √Not applicable
□Applicable √Not applicable
VIII Changes in Consolidation Scope
□Applicable √Not applicable
(1). Business combinations involving entities not under common control for the current
period
□Applicable √Not applicable
(2). Consolidation cost and goodwill
□Applicable √Not applicable
(3). The acquiree can identify the assets and liabilities on the date of purchase
□Applicable √Not applicable
Annual Report 2021
(4). Gains or losses resulting from the remeasurement of equity held prior to the date of
purchase at fair value
Whether there is a transaction that through multiple transaction step by step to realize business
combination and gaining the control during the Reporting Period
□Applicable √Not applicable
(5). Notes to reasonable consideration or fair value of identifiable assets and liabilities of the
Acquiree that cannot be determined on the date of purchase or at the end of the merger
□Applicable √Not applicable
(6). Other notes:
□Applicable √Not applicable
□Applicable √Not applicable
(1). Business combinations involving entities under common control for the current period
□Applicable √Not applicable
(2). Combination cost
□Applicable √Not applicable
(3). Carrying value of assets and liabilities of the combined party on the date of
consolidation
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
Whether there was a single disposal of an investment in a subsidiary that resulted in a loss of
control
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
Describe other changes in the consolidation scope (e.g., new subsidiaries, liquidation of
subsidiaries, etc.) and relevant situations:
√Applicable □Not applicable
Way to gain Time and place Contribution Contribution
Name
equity of gaining equity amount proportion
Hainan Dacheng Set-up January 2021 RMB10 million 100.00%
Intelligent
Set-up October 2021 RMB1 million 100.00%
Technology
Hainan Dacheng completed the business registration procedures on 21 January 2021, and
obtained a business license with a unified social credit code of 91469001MA5TUL9A2F, with a
Annual Report 2021
registered capital of RMB10,000,000 and a shareholding ratio of 100% of the Company. As at 31
December 2021, the Company's paid-up capital contribution was RMB10,000,000. Therefore,
since the date of its establishment, Hainan Dacheng has been included in the scope of the
consolidated financial statements.
On 18 October 2021, Intelligent Technology completed the business registration procedures,
and obtained a business license with a unified social credit code of 91330282MA7BJRX4XL, with
a registered capital of RMB10,000,000 and a shareholding ratio of 100% of the Company. As at
since the date of its establishment, Intelligent Technology has been included in the scope of the
consolidated financial statements.
□Applicable √Not applicable
IX Interests in Other Entities
(1). Subsidiaries
√Applicable □Not applicable
Main Shareholding ratio (%)
Subsidiary Registration Nature of Acquisition
operating
Name place business Directly Indirectly Method
place
Merge
Ningbo Ningbo, Ningbo, Manufacturing under
Gongniu Zhejiang Zhejiang industry common
control
Gongniu Ningbo, Ningbo, Manufacturing
Photoelectric Zhejiang Zhejiang industry
Gongniu Ningbo, Ningbo, Manufacturing
Digital Zhejiang Zhejiang industry
Banmen
Ningbo, Ningbo, Manufacturing
Electric 100.00 Set-up
Zhejiang Zhejiang industry
Appliance
Gongniu Ningbo, Ningbo, Manufacturing
Precision Zhejiang Zhejiang industry
Merge
Electric Ningbo, Ningbo, under
Commercial 100.00
Sales Zhejiang Zhejiang common
control
Merge
Cixi Ningbo, Ningbo, under
Commercial 100.00
Gongniu Zhejiang Zhejiang common
control
Merge
Shanghai under
Shanghai Shanghai Commercial 100.00
Gongniu common
control
Annual Report 2021
Gongniu Ningbo, Ningbo,
Commercial 100.00 Set-up
Management Zhejiang Zhejiang
Bull
Ningbo, Ningbo,
International Commercial 100.00 Set-up
Zhejiang Zhejiang
Trading
Merge
Hong under
Bull HK Hong Kong Commercial 100.00
Kong common
control
Merge
Xingluo Ningbo, Ningbo, under
Commercial 100.00
Trading Zhejiang Zhejiang common
control
Gongniu Ningbo, Ningbo,
Commercial 100.00 Set-up
Low Voltage Zhejiang Zhejiang
Domestic
Ningbo, Ningbo, Manufacturing
Electrical 100.00 Set-up
Zhejiang Zhejiang industry
Appliance
Hainan Sanya, Sanya, Commercial
Dacheng Hainan Hainan services
Intelligent Ningbo, Ningbo, Manufacturing
Technology Zhejiang Zhejiang industry
(2). Significant non-wholly-owned subsidiary
□Applicable √Not applicable
(3). The main financial information of significant not wholly-owned subsidiary
□Applicable √Not applicable
(4). Significant restrictions on the use of assets and the settlement of debts of the Group
□Applicable √Not applicable
(5). Financial or other support to structured entities included in the scope of consolidated
financial statements
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
are still controlled by the Company
□Applicable √Not applicable
(1). Notes to changes in owners' equity in the subsidiary
□Applicable √Not applicable
(2). Influence of transactions on non-controlling interests and equity attributable to owners
of the Company as the parent
□Applicable √Not applicable
□Applicable √Not applicable
(1). Significant joint ventures or associated enterprises
□Applicable √Not applicable
Annual Report 2021
(2). Main financial information for significant joint ventures
□Applicable √Not applicable
(3). Main financial information for significant associated enterprises
□Applicable √Not applicable
(4). Summary of financial information of insignificant joint ventures or associated
enterprises
□Applicable √Not applicable
(5). Notes to significant limitations on the ability of joint ventures or associated enterprises
to transfer funds to the Company
□Applicable √Not applicable
(6). Excess losses incurred by joint ventures or associated enterprises
□Applicable √Not applicable
(7). Unconfirmed commitments related to investments of joint ventures
□Applicable √Not applicable
(8). Contingent liabilities related to investments of joint ventures or associated enterprises
□Applicable √Not applicable
□Applicable √Not applicable
financial statements
Notes to the structured entity excluded in the scope of consolidated financial statements:
□Applicable √Not applicable
□Applicable √Not applicable
X Risks Related to Financial Instruments
√Applicable □Not applicable
The Company is engaged in risk management to achieve balance between risks and returns,
minimizing the negative effects of risks on its operation performance and maximizing the interests
of its shareholders and other equity investors. Based on that risk management goal, the
fundamental strategy of its risk management is to identify and analyze various risks facing the
Company, establish an appropriate risk bottom line, carry out risk management and monitor
various risks in a timely and reliable manner to control them within a restricted scope.
The Company faces various risks related to financial instruments in its routine activities,
mainly including credit risk, liquidity risk market risk. The management has reviewed and
approved the policies of managing those risks, which are summarized as follows.
(I) Credit risk
Annual Report 2021
Credit risk means the risk of financial losses incurred to the other party when one party of a
financial instrument is unable to fulfill its obligations.
(1) Methods for evaluating credit risk
On each balance sheet date, the Company shall evaluate whether the credit risk of relevant
financial instruments has increased significantly since the initial recognition. After determining
whether the credit risk has increased significantly since the initial recognition, the Company shall
consider obtaining reasonable and reliable information without paying unnecessary extra costs or
efforts, including qualitative and quantitative analysis based on historical data, external credit risk
rating and forward-looking information. On the basis of the single financial instrument or
combination of financial instruments with similar credit risk characteristics, the Company
compares the risk of default of financial instruments on the balance sheet date with the risk of
default on the initial recognition date to determine the change of default risk of financial
instruments during their expected duration.
When one or more of the following quantitative and qualitative criteria prevails, the
Company shall believe the credit risk of financial instruments has increased significantly:
at the balance sheet date increases by more than a certain percentage from the time of initial
recognition;
financial status, changes in the existing or expected technical, market, economic or legal
environment that will have a material adverse impact on the debtor's ability to repay the Company.
(2) Definition of default and asset with credit impairment
When a financial instrument meets one or more of the following conditions, the Company
shall define the financial asset as having defaulted, and its criteria are consistent with the
definition of having incurred credit impairment:
Annual Report 2021
difficulties, gives concessions to the debtor which would not have been made in any other
circumstances.
The key parameters for measuring expected credit loss included default probability, loss
given default and exposure at default. The Company considered quantitative analysis and forward-
looking information of historical statistical data (such as counterparty rating, guarantee method,
repayment method, etc.) to establish a model of probability of default, default loss ratio and
default risk exposure.
financial instruments is detailed in the "4. Notes receivable", "5. Accounts receivable", and "8.
Other receivables" in "VII. Notes to Items in the Consolidated Financial Statements" of "Section
The Company's credit risk is primarily derived from monetary assets and amounts receivable.
To control the aforementioned relevant risks, the Company has adopted the following measures.
(1) Monetary assets
The Company deposited the bank deposit and other monetary assets to finance institutions
with higher credit rating, which lowered the credit risk.
(2) Accounts receivable
The Company continuously conducted credit assessments for customers who trade on credit
lines. Based on the credit assessment result, the Company chooses to trade with recognized
customers with good credit and monitor the balance of the accounts receivable from them to
ensure that the Company will not face any significant bad debt risk.
Due to the Company merely trades with the authorized third party with good credit, the
guarantee is not required. Credit risk concentration is managed in accordance with the customers.
As at 31 December 2021, the Company was has certain credit concentration risks, with 70.04% of
the Company's accounts receivable (31 December 2020: 48.77%) originating from the top five
customers on balance. The Company did not hold any collateral or other credit enhancements on
the balance of accounts receivable.
Annual Report 2021
The maximum credit risk exposure the Company undertook shall be the carrying value of
each financial asset on balance sheet.
(II) Liquidity risk
Liquidity risk refers to the risk of fund shortage occurring when the Company fulfills the
settlement obligation in the mode of cash delivery or other financial assets. Liquidity risk may
originate from the failure to sell financial assets at fair value as soon as possible; or from the other
party’s failure to pay off its contractual debts; or from the earlier maturity of debts; or from the
failure to generate the expected cash flow.
To control the risk, the Company comprehensively used a variety of financing methods such
as bank clearing and bank borrowing, and adopted the appropriate combination of long-term and
short-term financing methods to optimize the financing structure and maintain a balance between
financing sustainability and flexibility. The Company has obtained the line of credit from a
number of commercial banks to satisfy its operation fund needs and capital expenditure.
Financial liabilities classified by remaining maturity
Closing balance
Item Undiscounted
Carrying amount Within one year 1-3 years Over 3 years
contract amount
Banking
borrowings
Notes
payable
Accounts
payable
Other
payables
Current
portion of
non-current
liabilities
Lease
liabilities
Subtotal 3,314,266,429.46 3,325,867,177.54 3,320,658,624.57 5,208,552.97
(Continued)
Year-end balance of last year
Item
Undiscounted
Carrying amount Within one year 1-3 years Over 3 years
contract amount
Banking
borrowings
Annual Report 2021
Year-end balance of last year
Item
Undiscounted
Carrying amount Within one year 1-3 years Over 3 years
contract amount
Accounts
payable
Other
payables
Subtotal 2,165,295,497.77 2,175,875,635.52 2,015,544,238.26 160,331,397.26
(III) Market risk
Market risk refers to the risk of fluctuations in the fair value or future cash flows of financial
instruments arising from changes in market prices. Market risk mainly includes interest rate risk
and foreign exchange risk.
Interest rate risk refers to the risk of fluctuations in the fair value or future cash flows of
financial instruments arising from changes in market interest rates. Interest-bearing financial
instruments with fixed interest rates may bring the fair value interest rate risk to the Company,
while those with floating interest rate may bring the cash flow interest rate risk to the Company.
The Company will determine the proportion between the financial instruments with fixed interest
rate and those with floating interest rate in combination with market environment, and maintain an
appropriate portfolio of financial instruments through regular review and monitoring. The interest
rate risk of cash flows facing the Company is mainly related to the bank loans calculated by
floating interest rate of the Company.
As at 31 December 2021, the Company had borrowed RMB1,160,000,000.00 from banks and
the interest rate change would not have a significant influence on the Company's gross profit and
shareholders' equity.
Foreign exchange risk refers to the risk that may lead to the changes of fair value of financial
instruments or future cash flows due to fluctuation in exchange rate. The Company operates in
mainland China, and the main activities are recorded by RMB. Thus, the foreign exchange market
risk undertaken is insignificant for the Company.
Annual Report 2021
The Company's foreign currency monetary assets and liabilities at the end of the period are
detailed in "82. Foreign currency monetary items" in "VII. Notes to Items in Consolidated
Financial Statements" of "Section 10 Financial Report" of the Annual Report.
XI The Disclosure of Fair Value
√Applicable □Not applicable
Unit: RMB
Closing fair value
Fair value Fair value
Fair value
Item measurement measurement
measurement Total
items at level items at level
items at level 3
I. Consistent fair
value measurement
(I) Held-for-trading
financial assets
measured at fair
value through profit
or loss for the current
period
(1) Debt instrument
investments
(2) Equity
instruments
investments
(3) Derivative
financial assets
(4) Asset
management plan
(5) Banking WM
product
(6) Trust product 1,120,000,000.00 1,120,000,000.00
(7) Securities return
voucher
financial assets at fair
value through profit
or loss
(1) Debt instrument
investments
(2) Equity
instruments
investments
(II) Other debt
investments
(III) Other equity
investments
(IV) Investment
property
rent
Annual Report 2021
and to be transferred
after appreciation
(V) Biological assets
biological assets
assets
The total amount of
assets consistently
measured at fair
value
(VI) Held-for-trading
financial liabilities
measured at fair
value through profit
or loss for the current
period
Of which: Issued
trading bonds
Derivative financial
liabilities
Others
financial liabilities
measured at fair
value through profit
or loss for the current
period
Total amount of
liabilities at fair
value
II. Inconsistent Fair
Value Measurement
(II) Assets held for
sale
Total assets of
inconsistent fair
value measurement
Total liabilities of
inconsistent fair
value measurement
measurement items at Level 1
√Applicable □Not applicable
The Company's first-level item measured at fair value is derivative financial assets (futures
contract), which determines the fair value based on the public quotation of the futures market.
parameters for consistent and inconsistent fair value measurement items at Level 2
□Applicable √Not applicable
Annual Report 2021
parameters for consistent and inconsistent fair value measurement items at Level 3
√Applicable □Not applicable
The Company's third-level items measured at fair value are bank wealth management
products and trust products, etc., with a low expected yield rate and a small change in fair value,
so the initial recognition cost is used as its fair value.
analysis of unobservable parameters of third-level items measured consistently at fair
value
□Applicable √Not applicable
conversion, where there is a conversion between the various levels for the current
period in items consistently measured at fair value
□Applicable √Not applicable
reasons for the changes
□Applicable √Not applicable
□Applicable √Not applicable
□Applicable √Not applicable
XII Related Party and Related-party Transaction
√Applicable □Not applicable
Unit: RMB
Shareholding Proportion of
percentage voting rights
Registration Nature of Registered held by the owned by the
Name
place business capital Company as Company as the
the parent to parent to the
the Company Company (%)
Liangji Ningbo,
Investment 500,000,000.00 53.89 53.89
Industrial Zhejiang
Notes: Information on the Company as the parent
Ruan Liping and Ruan Xueping are the joint actual controllers of the Company, and the two
jointly hold 100% of the equity of Liangji Industrial, 53.89% of the equity of the Company
through Liangji Industrial, and directly hold 32.22% of the equity of the Company through the
Ningbo Ninghui Investment Management Partnership (Limited Partnership), indirectly holds
Company through the Ningbo Suiyuan Investment Management Partnership (Limited Partnership).
The ultimate controllers of the Company are Ruan Liping and Ruan Xueping.
Annual Report 2021
Details of the subsidiaries of the Company are in the notes
√Applicable □Not applicable
The Company's subsidiaries are detailed in "IX. Interests in Other Entities" of "Section 10
Financial Report" of the Annual Report
Details of joint ventures and associated enterprises of the Company are in the notes
□Applicable √Not applicable
The following are the circumstances of other joint ventures or associated enterprises that have a
balance with the Company for the current period or that have formed balances from related-party
transactions with the Company for the previous period
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
√Applicable □Not applicable
Name of other related party Relationship with the Company
Ruan Shuhong Daughter of the actual controller Ruan Liping
Ying Jianguo Brother-in-law of Director Cai Yingfeng
Xia Zhonggui Brother of Supervisor Li Yu's spouse
Father of Director Cai Yingfeng's daughter Cai
Yu Shoufu
Mengshu's spouse
A company controlled by Sun Xiaoping, the spouse
Baidi Electrics
of the actual controller, Ruan Xueping
A company controlled by the actual controller, Ruan
Liangniu Hardware Liping's wife's brother Pan Minfeng and his wife Xu
Yirong
A company controlled by the actual controller, Ruan
Hangniu Hardware Liping's wife's brother Pan Minfeng and his wife Xu
Yirong
The actual controller Ruan Liping's wife's brother Pan
Minfeng and his wife Xu Yirong's son Pan Qianliang
Feiniu Hardware
holds 55% of the shares, and Xu Yirong holds 45% of
the shares
A company controlled by Yu Shoufu, father of
Niuweiwang Trading
Director Cai Yingfeng's daughter's spouse
The main body controlled by Cai Libo, sister of
Cixi Libo
Director Cai Yingfeng
A company controlled by the Ying Jianguo, brother-
Jianke Trading
in-law of Director Cai Yingfeng
Zhang Meina, sister of Senior Executive Zhang Lina,
Yaoyang Trading holds 40% of the shares, and Xu Yanhao, son of
Zhang Meina, holds 60% of the shares
Zhang Meina, sister of Senior Executive Zhang Lina,
Huantian Trading holds 1.33% of the shares, and Xu Yanhao, son of
Zhang Meina, holds 98.67% of the shares<
A company controlled by Xia Zhonggui, brother of
Chenhao Electronic Supervisor Li Yu's spouse, and his spouse Zeng
Minhui
Annual Report 2021
(1). Related-party transactions of purchase and sale of goods, provision and acceptance of
services
Information on acquisition of goods and reception of labor service
□Applicable √Not applicable
Information of sales of goods and provision of labor service
√Applicable □Not applicable
Unit: RMB
Related party Content 2021 2020
Adapters, wall
Liangniu Hardware switches, LEDs, 19,286,108.43 25,692,578.69
digital products
Adapters, wall
Hangniu Hardware switches, LEDs, 35,795,907.44 35,572,317.82
digital products
Adapters, digital
Feiniu Hardware 1,282,944.42 2,727,584.86
products
Subtotal of Hangniu
Hardware [note]
Adapters, LEDs,
Huantian Trading 12,206,053.32 8,896,692.07
digital products
Niuweiwang Trading Adapters, LEDs 21,108,464.96 18,101,438.63
Adapters, LEDs,
Jianke Trading 10,814,536.24 12,085,364.10
digital products
Adapters, LEDs,
Cixi Libo 11,075,424.86 10,617,022.78
digital products
Digital products,
Chenhao Electronic 894,547.84 784,582.86
Adapters
Subtotal 112,463,987.51 114,477,581.81
Notes to acquisition of goods and reception of labor service
√Applicable □Not applicable
[Note] Hangniu Hardware includes Hangniu Hardware, Liangniu Hardware, and Feiniu Hardware.
Liangniu Hardware and Hangniu Hardware are controlled by Pan Minfeng and his spouse Xu
Yirong; Feiniu Hardware is 55% owned by Pan Minfeng's son Pan Qianliang and 45% owned by
Xu Yirong.
(2). Related entrusted management/contracting and entrusted management/outsourcing
Lists of trusteeship/contract:
□Applicable √Not applicable
Notes:
□Applicable √Not applicable
Entrusted management/contracting of the Company
□Applicable √Not applicable
Notes:
□Applicable √Not applicable
(3). Information on related-party lease
The Company was lessor:
□Applicable √Not applicable
Annual Report 2021
The Company was lessee:
√Applicable □Not applicable
Unit: RMB
Category of leased The lease fee confirmed The lease fee confirmed in
Name of lessor
assets in the Reporting Period the same period of last year
Houses and
Ruan Shuhong 799,598.46 624,000.00
buildings
Baidi Electrics Vehicle 81,471.29
Total 799,598.46 705,471.29
Notes:
□Applicable √Not applicable
(4). Information on related-party guarantee
The Company was guarantor:
□Applicable √Not applicable
The Company was secured party
√Applicable □Not applicable
Unit: RMB'0,000
Amount of Execution
Guarantor: Start date End date
guarantee accomplished or not
Liangji
Industrial
Liangji
Industrial
Notes:
√Applicable □Not applicable
Guarantees that have expired before the reporting date are processed as completed.
(5). Borrowings of funds
□Applicable √Not applicable
(6). Information on assets transfer and debt restructuring by related party
□Applicable √Not applicable
(7). Remuneration for key management personnel
√Applicable □Not applicable
Unit: RMB'0,000
Item 2021 2020
Remuneration for key
management personnel
(8). Other related transaction
□Applicable √Not applicable
(1). Accounts receivable
□Applicable √Not applicable
(2). Accounts payable
√Applicable □Not applicable
Unit: RMB
Project Related party Closing carrying Opening carrying amount
Annual Report 2021
amount
Contract liabilities Liangniu Hardware 1,500,950.96 32,690.76
Contract liabilities Jianke Trading 322,837.70 934,206.12
Contract liabilities Cixi Libo 157,748.83 709,155.01
Contract liabilities Hangniu Hardware 96,061.89 1,045,591.50
Contract liabilities Huantian Trading 28,959.98 2,156,284.68
Niuweiwang
Contract liabilities 13,432.85 1,520,723.27
Trading
Contract liabilities Feiniu Hardware 11,914.81 234.58
Contract liabilities Yaoyang Trading 3,461.19 3,461.19
Contract liabilities Chenhao Electronic 2,727.19 13,855.94
Subtotal 2,138,095.40 6,416,203.03
Other current
Liangniu Hardware 195,123.62 4,249.80
liabilities
Other current
Jianke Trading 41,968.90 121,446.79
liabilities
Other current
Cixi Libo 20,507.35 92,190.15
liabilities
Other current
Hangniu Hardware 12,488.05 135,926.89
liabilities
Other current
Huantian Trading 3,764.80 280,317.01
liabilities
Other current Niuweiwang
liabilities Trading
Other current
Feiniu Hardware 1,548.92 30.49
liabilities
Other current
Yaoyang Trading 449.95 449.95
liabilities
Other current
Chenhao Electronic 354.53 1,801.27
liabilities
Subtotal 277,952.39 834,106.39
Other payables Hangniu Hardware 70,000.00 70,000.00
Other payables Liangniu Hardware 70,000.00 70,000.00
Other payables Cixi Libo 30,000.00 30,000.00
Other payables Yaoyang Trading 30,000.00 30,000.00
Other payables Jianke Trading 20,000.00 20,000.00
Niuweiwang
Other payables 20,000.00 20,000.00
Trading
Other payables Feiniu Hardware 20,000.00 20,000.00
Other payables Huantian Trading 20,000.00 20,000.00
Other payables Chenhao Electronic 10,000.00 10,000.00
Subtotal 290,000.00 290,000.00
□Applicable √Not applicable
□Applicable √Not applicable
XIII Share-based Payment
√Applicable □Not applicable
Unit: Share
The total amount of equity instruments granted
by the Company for the current period
Annual Report 2021
The total amount of the Company's equity
instruments exercised for the current period
The total amount of equity instruments of the
Company losing efficacy for the current period
The range of exercise prices of stock options
issued and outstanding at the end of the period of
the Company and the remaining term of the
contract
The exercise price of restricted shares in 2020
The scope of exercise prices of other equity
was: RMB76.13; the remaining contract term
instruments issued by the Company at the end of
was: 1.5 years; the exercise price of restricted
the reporting period and the remaining term of
shares in 2021 was: RMB88.15; the remaining
contracts
contract term was: 2.5 years.
Other notes:
(1) Restricted share incentive scheme in 2020
The Company held the 12th Meeting of the 1st Board of Directors of the Company and the
Scheme in 2020 (Draft) and Its Summary, Proposal on Adjusting the List of Incentive Targets, the
Number of Grants and the Grant Price of the Restricted Share Incentive Scheme in 2020 and the
Proposal on Granting Restrictive Shares to Incentive Targets were deliberated and adopted. The
Company decided to grant 613,800 restricted shares to 441 incentive subjects who met the
conditions for the grant at a price of RMB76.13 per share, with an equity grant date of 3 June
The main performance appraisal requirements for restricted shares: For the first release
period, the performance appraisal target was the operating revenue or net profit attributable to the
shareholders of the listed company in 2020 was not less than the average of the previous three
fiscal years (i.e. 2017 - 2019); for the second release period, the performance appraisal target was
the operating revenue or net profit attributable to the shareholders of the listed company in 2021
was not lower than the average of the previous three fiscal years (i.e. 2018 - 2020); for the third
release period, the performance appraisal target was the operating revenue or net profit attributable
to the shareholders of the listed company in 2022 was not lower than the average of the previous
three fiscal years (i.e. 2019 - 2021).
In 2021, the Company's restricted share incentive scheme in 2020 recognized equity
incentive expenses of RMB18,904,562.82.
(2) Restricted share incentive scheme in 2021
Annual Report 2021
The Company held the 5th Meeting of the 2nd Board of Directors of the Company and the
Scheme in 2021 (Draft) and Its Summary, Proposal on Adjusting the List of Incentive Targets, the
Number of Grants and the Grant Price of the Restricted Share Incentive Scheme in 2021 and the
Proposal on Granting Restrictive Shares to Incentive Targets were deliberated and adopted. The
Company decided to grant 668,400 restricted shares to 523 incentive subjects who met the
conditions for the grant at a price of RMB88.15 per share, with an equity grant date of 4 June
The main performance appraisal requirements for restricted shares: For the first release
period, the performance appraisal target was the operating revenue or net profit attributable to the
shareholders of the listed company in 2021 was not less than 110% of the average of the previous
three fiscal years (i.e. 2018 - 2020); for the second release period, the performance appraisal target
was the operating revenue or net profit attributable to the shareholders of the listed company in
for the third release period, the performance appraisal target was the operating revenue or net
profit attributable to the shareholders of the listed company in 2023 was not lower than 110% of
the average of the previous three fiscal years (i.e. 2020 - 2022).
As at 22 June 2021, the Company has received a total of RMB58,919,460.00 in restricted
share subscription payments from 523 incentive subjects in monetary assets, of which
RMB668,400.00 is included in the paid-up share capital, and RMB58,251,060.00 in capital
reserves (share capital premium). The matter was examined by Pan-China Certified Public
Accountants LLP, which issued the Capital Verification Report (T.J.Y. [2021] No. 343).
In 2021, the Company's restricted share incentive scheme in 2021 included in the equity
incentive expense of RMB22,185,891.00.
√Applicable □Not applicable
Unit: RMB
Methods for determining the fair value of equity The fair value of the restricted shares is the
instruments on the grant date closing price on the grant date
The number of people expected to exercise the
Basis for determining the number of feasible
rights is multiplied by the number granted per
right equity instruments
person
Reasons for the significant discrepancy between
Annual Report 2021
the current period estimates and the previous
estimates
Equity-settled share-based payments were
included in the cumulative amount of capital RMB61,686,648.76
reserves
The total amount of the expense recognized for
RMB41,090,453.82
the current period paid on equity-settled shares
Other notes:
The Company accounts for the above share payments in line with the relevant provisions of
share-based payments in Accounting Standard for Business Enterprises as equity-settled share-
based payments, and on each balance sheet date of the waiting period, on the basis of the best
estimate of the number of viable equity instruments, the services received in the current period are
included in the administrative expense based on the fair value of the equity instruments granted on
the grant date, and the capital reserves (other capital reserves) of RMB41,090,453.82 are added.
□Applicable √Not applicable
□Applicable √Not applicable
√Applicable □Not applicable
On 23 April 2020, the Company held the 11th Meeting of the 1st Board of Directors, where
the Special Talent Shareholding Plan was deliberated and adopted, which granted shares of the
Special Talent Shareholding Plan to eligible employees of the Company. The number of people
involved included supervisors, specially introduced talents and talents with special contribution,
and the number of people did not exceed 23. The source of funds for the shareholding plan is the
special fund of the shareholding plan accrued by the Company, and the total amount of funds for
the shareholding plan is RMB50,000,000, RMB1 per share. The source of stock in the
shareholding plan is the A-share common stock of the Company acquired in the secondary market.
After the Company's performance evaluation target under the current shareholding plan is
achieved, the corresponding interests of the underlying stock of the holders will be vested to the
holders in batches in line with the evaluation situation in the year of attribution. If there is any
remaining unallocated underlying stock and its corresponding dividends (if any), they will all
belong to the Company.
Annual Report 2021
The duration of the shareholding plan is 60 months, counting from the date of completion of
the acquisition of the underlying stock announced by the Company. Before the expiration of the
duration, it may be extended after the shareholding plan management committee submits it to the
Board of Directors for deliberation and adoption.
The lock-up period for each batch of the subject shares under the shareholding plan is 12
months, 24 months, 36 months and 48 months, respectively, and the lock-up period is calculated
from the date of the Company's disclosure of the completion of the stock acquisition in the
secondary market, and no transactions shall be carried out during the lock-up period.
After the expiration of the lock-up period, it is divided into four batches, and the specific
attribution arrangement of each batch is as follows: Attribution of the 1st batch: 12 months from
the date of completion of the Company's announcement of the completion of the stock acquisition,
the planned attribution amount is 25% of the total number of stock subject to the shareholding
plan. Attribution of the 2nd batch: 24 months from the date of completion of the stock acquisition
announced by the Company, the planned attribution amount is 25% of the total number of stock
subject to the shareholding plan. Attribution of the 3rd batch: 36 months from the date of
completion of the stock acquisition announced by the Company, the planned attribution amount is
months from the date of completion of the stock acquisition announced by the Company, the
planned attribution amount is 25% of the total number of stock subject to the shareholding plan.
The evaluation target for the attribution of each batch under the shareholding plan is that the
operating revenue or net profit for the current year is not lower than the average of the previous
three fiscal years.
On 25 September 2020, Sinolink Securities Co., Ltd., the manager entrusted by the Company,
has completed the stock acquisition of the 2020 Special Talent Shareholding Plan through the
Gongniu Group, with a total acquisition of 322,000 shares, a transaction amount of
RMB50,002,409, and an average transaction price of RMB155.29 per share.
The Company actually granted 3,600,000 shares of the 2020 employee shareholding plan and
due to the resignation of employees. The Company presents the granted share of the plan as the
Annual Report 2021
long-term prepaid expense, confirmed the amortization of share payment by the evaluation period,
and presents the portion not granted as the other non-current assets. In 2021, the Company's
amortization by service period was included in the administrative expense of RMB6,701,548.01
for the current period.
XIV. Commitment and Contingency
√Applicable □Not applicable
The external significant commitments, nature and amounts that exist on the balance sheet date
As at 31 December 2021, the Company's public offerings to raise funds for investment items
are as follows:
Fund raising
Amount used
Investment
Project Raised fund
amount
(RMB'0,000)
(RMB'0,000)
Base construction project for annual output of 410 75,452.86 24,948.38
million sets of wall switches and sockets
Construction project for automation upgrading of 58,883.63 30,147.31
annual output of 400 million sets of converters
Base, R&D center and headquarters base
construction project for an annual output of 180 115,203.61 32,096.12
million sets of LED lamps
Information construction project 16,035.00 8,762.33
Channel terminal construction and brand promotion 84,745.75 25,603.52
projects
Total 350,320.85 121,557.66
(1). Significant contingencies existing on the balance sheet date
□Applicable √Not applicable
(2). If the Company does not have significant contingencies to be disclosed, it should also be
stated:
□Applicable √Not applicable
□Applicable √Not applicable
XV Subsequent Events after the Balance Sheet Date
□Applicable √Not applicable
√Applicable □Not applicable
Unit: RMB
Profit or dividend to be distributed 1,442,833,248.00
Profit or dividend announced to issue
Annual Report 2021
after review and approval
□Applicable √Not applicable
√Applicable □Not applicable
(1) Profit appropriation after balance sheet date
On 11 April 2022, the Company held the 10th Meeting of the 2nd Board of Directors, where
the 2021 Annual Profit Appropriation Plan was passed. Based on the total share capital registered
on the record date of the implementation of the equity appropriation, and the Company intended to
allocate a cash dividend of RMB24 (including tax) to all shareholders for every 10 shares,
calculated based on the total share capital of the Company as at the date of approval of the report,
with a total cash dividend of RMB1,442,833,248.00 to be allocated.
(2) Restricted shared incentive scheme in 2022
In line with the Restricted Share Incentive Scheme in 2022 approved at the 10th Meeting of
the Company's 2nd Board of Directors on 11 April 2022, the Company granted a total of 1.55
million restricted shares to 670 incentive subjects at a certain price. The restricted share incentive
scheme shall be implemented after the approval of the Company's General Meeting.
The restricted shares granted by the incentive scheme shall be evaluated for performance in
three years during the release period and the restriction will be released, to achieve the
performance evaluation target as the condition for releasing the restriction on the incentive
subjects. For the 1st release period, the operating revenue or net profit in 2022 is not less than the
average of the previous three fiscal years (i.e. 2019 - 2021) and not less than 110% of the average
of the previous two fiscal years (i.e. 2020 - 2021); for the 2nd release period, the operating
revenue or net profit in 2023 is not less than the average of the previous three fiscal years (i.e.
average of the previous three fiscal years (i.e. 2021 - 2023) and not less than 110% of the average
of the previous two fiscal years (i.e. 2022 - 2023).
(3) The Company's stock repurchase scheme
The Company held the 10th Meeting of the 2nd Board of Directors on 11 April 2022, where
it intended to repurchase its shares through a call auction transaction with its own funds, and the
Annual Report 2021
repurchase price shall not exceed RMB203 per share (inclusive); the total amount of repurchase
shall not be less than RMB200,000,000 (inclusive) and shall not exceed RMB300,000,000
(inclusive), and the repurchase period shall be within 12 months from the date when the
Company's Board of Directors deliberates and adopts the repurchase scheme.
The shares repurchased by the Company will be used for equity incentives at an appropriate
time in the future, and will be transferred within three years after the date of the announcement of
the implementation of the share repurchase and the announcement of the change of shares. If it is
not transferred, the Company will perform the procedures for deducting the registered capital in
accordance with the law, and the shares not transferred will be canceled.
XVI Other Significant Events
(1). Retrospective restatement
□Applicable √Not applicable
(2). Prospective application
□Applicable √Not applicable
□Applicable √Not applicable
(1). Exchange of non-monetary assets
□Applicable √Not applicable
(2). Replacement of other assets
□Applicable √Not applicable
□Applicable √Not applicable
□Applicable √Not applicable
(1). Basis for the determination of the reporting segment and accounting policies
√Applicable □Not applicable
The Company determines the reporting segment on the basis of the regional division, the
income from principal businesses and the cost of principal business are divided based on the final
sales place, and the assets and liabilities are divided based on the location of the operating entity.
(2). Financial information of reporting segment
√Applicable □Not applicable
Annual Report 2021
Unit: RMB
Overseas Offset
Item Domestic Domestic Overseas among Total
company company segment
Principal
business revenue
Principal
operating cost
Total assets 15,473,709,339.85 195,326.77 15,473,904,666.62
Total liabilities 4,718,130,450.63 22,639.36 4,718,153,089.99
(3). If the Company does not report the segment, or cannot disclose the total assets and
liabilities of each reporting segment, the reasons should be explained
□Applicable √Not applicable
(4). Other notes:
√Applicable □Not applicable
On 18 August 2021, the Company signed the Equity Transfer Agreement with Dalitek
Intelligent Technology (Shanghai) Inc. (hereinafter referred to as "Dalitek") and its shareholders
BRIDGES ELECTRONIC TECHNOLOGY CO., LTD., Shanghai Houqi Investment Center
(Limited Partnership) and natural person shareholders Pan Xiaobin and Zhang Wenying, agreeing
that 70% of the equity interests of the Company held by the shareholders be transferred at the
price of RMB91,000,000, the down payment of RMB63,700,000 shall be made within 10 business
days after the completion of the relevant procedures and the delivery of the assets, and the
remaining equity transfer payment shall be made in three years in line with the completion of the
performance commitment.
As at 13 December 2021, the Company had paid a total of RMB26.9907 million for the
equity transfer, which had not yet reached 50% of the amount payable, so Dalitek was not
included in the Company's 2021 consolidated financial statements.
On 21 January 2022, the Company made the remaining equity transfer payment of
RMB36.7093 million for the down payment, which completed the down payment for the equity
transfer.
□Applicable √Not applicable
□Applicable √Not applicable
Annual Report 2021
XVII. Notes to Main Items in the Financial Statements of the Company as the Parent
(1). Disclosure by aging
√Applicable □Not applicable
Unit: RMB
Aging Closing carrying amount
Within one year
Of which: Sub-items within one year
Subtotal within one year 3,982,866.46
Over 3 years
Over 5 years
Total 3,982,866.46
(2). Classified disclosure based on the bad debt provision method
√Applicable □Not applicable
Unit: RMB
Closing balance Opening balance
Categor Carrying balance Bad debt provision Carrying balance Bad debt provision
y Accrued Carrying Accrued Carrying
Proportion value Proportion
Amount Amount proportion Amount Amount proportion value
(%) (%)
(%) (%)
Bad
debt
provisio
n
accrued
by item
Of which:
Bad
debt
provisio
n 100.00 5.00 3,783,723.14 100.00 671,167.06 5.00
accrued
by
portfolio
Of which:
Total 100.00 5.00 3,783,723.14 100.00 671,167.06 5.00
Bad debt provision accrued by item:
□Applicable √Not applicable
Bad debt provision accrued by portfolio:
√Applicable □Not applicable
Unit: RMB
Closing balance
Name Accrued proportion
Accounts receivable Bad debt provision
(%)
Within one year 3,982,866.46 199,143.32 5.00
Total 3,982,866.46 199,143.32 5.00
Criteria and explanation of bad debt provision accrued by portfolio:
□Applicable √Not applicable
To accrue bad debt provision under the expected general model of credit loss, please refer to the
disclosure of other receivables:
Annual Report 2021
□Applicable √Not applicable
(3). Status of bad debt provision
√Applicable □Not applicable
Unit: RMB
Changes for the current period
Opening Reversed Charged- Closing
Category Accrued Other
balance or off or balance
amount changes
recovered written-off
Bad debt
provision
accrued by
portfolio
Total 671,167.06 -472,023.74 199,143.32
Of which significant amount of recovered or transferred-back bad debt provision for the current
period:
□Applicable √Not applicable
(4). Status of written-off accounts receivable for the current period
□Applicable √Not applicable
Of which the writing-off of significant accounts receivable
□Applicable √Not applicable
(5). Status of accounts receivable of the top five closing balances by the parties in arrears
√Applicable □Not applicable
Unit: RMB
Proportion in total
closing balances of Closing balance of
Name of entity Closing balance
accounts receivable bad debt provision
(%)
Ningbo Gongniu 2,677,692.31 67.23 133,884.62
Credit Card Center
of China
Construction Bank
Co., Ltd.
Bull International
Trading
National Super
Computer Center in 31,954.00 0.80 1,597.70
Tianjin
Retail customers 23,533.14 0.59 1,176.66
Total 3,967,474.21 99.61 198,373.72
(6). Accounts receivable derecognized due to transfers of financial assets
□Applicable √Not applicable
(7). Amount of assets and liabilities formed due to transfer of accounts receivable and
continuous involvement
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
Annual Report 2021
List of items
√Applicable □Not applicable
Unit: RMB
Item Closing balance Opening balance
Interest receivable
Dividends receivable 2,000,000,000.00 1,000,000,000.00
Other receivables 1,038,980,082.79 686,576,004.18
Total 3,038,980,082.79 1,686,576,004.18
Other notes:
□Applicable √Not applicable
Interest receivable
(1). Category of interest receivables
□Applicable √Not applicable
(2). Significant overdue interest
□Applicable √Not applicable
(3). Status of accrued bad debt provision
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
(4). Dividends receivable
√Applicable □Not applicable
Unit: RMB
Project (or investee) Closing balance Opening balance
Ningbo Gongniu 1,000,000,000.00 1,000,000,000.00
Electric Sales 700,000,000.00
Gongniu Photoelectric 300,000,000.00
Total 2,000,000,000.00 1,000,000,000.00
(5). Significant dividends receivable aged over one year
□Applicable √Not applicable
(6). Status of accrued bad debt provision
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
Other receivables
(1). Disclosure by aging
√Applicable □Not applicable
Unit: RMB
Aging Closing carrying amount
Within one year
Of which: Sub-items within one year
Subtotal within one year 1,091,314,971.96
Annual Report 2021
Over 3 years 2,381,885.77
Over 5 years
Total 1,096,869,696.67
(2). Classification by nature of payments
√Applicable □Not applicable
Unit: RMB
Nature Closing carrying amount Opening carrying amount
Intercourse funds 1,000,999,087.76 714,572,754.19
Guaranteed deposit 88,048,852.00 2,650,000.00
Housing loan for employees 7,347,019.79 8,475,021.98
Others 474,737.12 82,714.00
Total 1,096,869,696.67 725,780,490.17
(3). Status of accrued bad debt provision
√Applicable □Not applicable
Unit: RMB
Stage 1 Stage 2 Stage 3
Expected Expected loss for Expected credit
Bad debt Total
credit loss in the entire duration losses for the entire
provision
the next 12 (without credit duration (with
months impairment) credit impairment)
Balance as at
January 1, 2021
Balance on
January 1, 2021
—— —— ——
for the current
period
- Transferred to
-80,555.00 80,555.00
Stage 2
- Transferred to
-394,362.48 394,362.48
Stage 3
- Transferred
back to Stage 2
- Transferred
back to Stage 1
Amount accrued
for the current 18,775,668.59 44,254.93 -134,795.63 18,685,127.89
period
Amount
transferred-back
for the current
period
Amount
charged-off for
the current
period
Amount written-
off for the
current period
Other changes
Balance as at 31 54,565,748.60 161,109.99 3,162,755.29 57,889,613.88
Annual Report 2021
December 2021
Notes to significant changes in the carrying amount of other receivables for which changes in the
loss reserve for the current period occurred:
□Applicable √Not applicable
The amount of bad debt provision for the current period and the basis for assessing whether the
credit risk of financial instruments has increased significantly:
□Applicable √Not applicable
(4). Status of bad debt provision
□Applicable √Not applicable
(5). Status of written-off other receivable for the current period
□Applicable √Not applicable
(6). Status of other receivables of the top five closing balances by the parties in arrears
√Applicable □Not applicable
Unit: RMB
Proportion in
total closing Bad debt
Name of balances of provision
Nature Closing balance Aging
entity other Closing
receivables balance
(%)
Gongniu Intercourse Within
Photoelectric funds one year
Gongniu Intercourse Within
Digital funds one year
Cixi Intercourse Within
Gongniu funds one year
Shanghai
Caohejing
Development
Zone
Zhaoxiang Guaranteed Within
Emerging deposit one year
Industry
Economic
Development
Co., Ltd.
Hainan Intercourse Within
Dacheng funds one year
Total / 1,027,950,176.68 93.72 51,397,508.83
(7). Accounts receivable involving government grants
□Applicable √Not applicable
(8). Other receivables derecognized due to transfers of financial assets
□Applicable √Not applicable
(9). Amount of assets and liabilities formed due to transfer of other receivables and
continuous involvement
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
Annual Report 2021
√Applicable □Not applicable
Unit: RMB
Closing balance Opening balance
Depreciati Depreciati
Item Carrying Carrying Carrying Carrying
on on
balance amount balance amount
reserves reserves
Investme
nt to 441,959,500 441,959,500 405,057,095 405,057,095
subsidiari .17 .17 .11 .11
es
Investme
nt to joint
ventures
and
associate
d
enterpris
es
Total
.17 .17 .11 .11
(1). Investment to subsidiaries
√Applicable □Not applicable
Unit: RMB
Decreas Depreciati
Closing
Increase for e for on reserves
Opening Closing balance of
Investee the current the accrued for
balance balance depreciati
period current the current
on reserve
period period
Ningbo 134,194,532. 8,525,964.8 142,720,497.
Gongniu 81 5 66
Gongniu
Photoelectr
ic
Gongniu 11,629,320.8 3,047,808.2 14,677,129.1
Digital 8 6 4
Banmen
Electric 833,107.38
Appliance
Gongniu 100,638,808. 1,502,630.2 102,141,438.
Precision 63 0 83
Cixi 41,711,794.5 42,399,186.5
Gongniu 0 0
Shanghai 39,224,724.6 1,277,474.0 40,502,198.6
Gongniu 3 0 3
Gongniu
Manageme 41,028.00
nt
Bull
Internation 3,110,000.00 3,110,000.00
al Trading
Electric 3,558,899.3 13,385,245.9
Sales 7 1
Xingluo 9,910,274.20 9,910,274.20
Annual Report 2021
Trading
LV Electric 1,248,151.13 550,933.98 1,799,085.11
Domestic
Electrical 1,326,581.91 2,591,280.19
Appliance
Hainan 10,000,000. 10,000,000.0
Dacheng 00 0
Intelligent
Technolog 1,000,000.00
y
Total
Other notes:
and an actual capital contribution of RMB10,000,000 as at 31 December 2021, and Intelligent
Technology with a registered capital of RMB10,000,000 for the current period, and an actual
contribution of RMB1000,000 as at 31 December 2021
subsidiaries, increasing the long-term equity investments of the subsidiaries by
RMB23,436,001.18; the Company granted the shares of the 2020 Special Talent Shareholding
Plan Fund to the core managers of the subsidiaries, increasing the long-term equity investments of
the subsidiaries by RMB2,466,403.88.
(2). Investment to joint ventures and associated enterprises
□Applicable √Not applicable
(1). Status of operating revenue and cost of sales
√Applicable □Not applicable
Unit: RMB
Item
Revenue Cost Revenue Cost
Principal business 5,196,022,727.01 3,782,944,961.56 4,382,278,159.34 3,156,072,624.63
Others 110,267,497.14 93,117,094.92 49,548,684.83 44,159,819.11
Total 5,306,290,224.15 3,876,062,056.48 4,431,826,844.17 3,200,232,443.74
Of which: Revenue
generated by
contracts with
customers
(2). Status of contract revenue
□Applicable √Not applicable
(3). Details of obligation for contract performance
□Applicable √Not applicable
Annual Report 2021
(4). Details of the apportionment to the remaining obligations for contract performance
□Applicable √Not applicable
Other notes:
None
√Applicable □Not applicable
Unit: RMB
Item 2021 2020
Long-term equity investments returns
calculated by cost accounting
Earnings of long-term equity
investments accounted for by the
equity method
Disposal of return on investment
resulting from long-term equity
investments
Return on investment of held-for-
trading financial assets for the 79,124,417.58 80,364,389.36
holding period
Dividend income of other equity
investments gained for the holding
period
Interest income of debt investments
gained for the holding period
Interest income of other debt
-3,305,694.45
investments for the holding period
Return on investment gained from
disposal of held-for-trading financial
assets
Return on investment gained from
-28,839,500.00
disposal of other equity investments
Return on investment gained from
disposal of debt investments
Return on investment gained from
disposal of other debt investments
Earnings of debt restructuring
Total 2,079,124,417.58 1,048,583,434.64
Other notes:
None
√Applicable □Not applicable
R&D expense:
Item 2021 2020
Employee remuneration 119,019,111.86 100,927,352.11
Direct investment 44,047,037.17 43,314,601.05
Depreciation and amortization 5,049,216.83 4,815,821.33
Others 22,328,622.99 14,519,231.41
Total 190,443,988.85 163,577,005.90
Annual Report 2021
XVIII Supplementary Information
√Applicable □Not applicable
Unit: RMB
Item Amount Note
Gain or loss on disposal of non-current -9,714,625.18
assets
Exceptional tax rebates, reductions and
exemptions given with ultra vires
approval, in lack of official approval
documents or for other reasons
Government grants through profit or loss 388,196,973.94
(exclusive of government grants
consistently given in the Company’s
ordinary course of business at fixed quotas
or amounts as per governmental policies
or standards)
Capital occupation charges on non- 8,121,324.51
financial enterprises that are recognized in
profit or loss
Gain equal to the amount by which
investment costs for the Company to
obtain subsidiaries, associates and joint
ventures are lower than the Company’s
enjoyable fair value of identifiable net
assets of investees when making
investments
Gain or loss on non-monetary asset swaps
Gain or loss on assets entrusted to other 171,623,256.63
entities for investment or management
Allowance for asset impairments due to
acts of God such as natural disasters
Gain or loss on debt restructuring
Restructuring costs in staff arrangement,
integration, etc.
Gain or loss on the over-fair value amount
as a result of transactions with distinctly
unfair prices
Current profit or loss on subsidiaries
obtained in business combinations
involving entities under common control
from the period-begin to combination
dates, net
Gain or loss on contingencies that do not
arise in the Company’s ordinary course of
business
Gain or loss on fair-value changes on 11,107,836.63
held-for-trading and derivative financial
assets and liabilities & income from
disposal of held-for-trading and derivative
financial assets and liabilities and other
debt investments (exclusive of the
effective portion of hedges that arise in the
Company’s ordinary course of business)
Reversed portions of impairment
Annual Report 2021
allowances for receivables and contract
assets which are tested individually for
impairment
Gain or loss on loan entrustments
Gain or loss on fair-value changes in
investment property of which subsequent
measurement is carried out using the fair
value method
Effects of all adjustments required by
taxation, accounting and other applicable
laws and regulations on current profit or
loss
Income from charges on entrusted
management
-327,898,293.86 RMB295 million was
paid for the fine imposed
Non-operating income and expense other
by the anti-trust decision
than the above
Zhe Shi Jian An (2021)
No. 4.
Other gains and losses that meet the 2,739,167.53
definition of exceptional gain/loss
Less: Income tax effects 96,291,397.10
Non-controlling interests effects (net of
tax)
Total 147,884,243.10
Explanation of why the Company reclassifies as recurrent an exceptional gain/loss item defined or
listed in the Explanatory Announcement No. 1 on Information Disclosure for Companies Offering
Their Securities to the Public—Exceptional Gain/Loss Items:
□Applicable √Not applicable
√Applicable □Not applicable
Weighted EPS
Profit of the Reporting Period
average ROE (%) Basic EPS Diluted EPS
Net profit attributable to
ordinary shareholders
Net profit attributable to
ordinary shareholders before 26.77 4.39 4.38
exceptional gains and losses
□Applicable √Not applicable
□Applicable √Not applicable
Chairman of the Board: Ruan Liping
Date when this Report was authorized for issue: 11 April 2022
Revised information:
Annual Report 2021
□Applicable √Not applicable
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